Exhibit 10.1(a)

 
$400,000,000
 
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
 
Dated as of April 3, 2007,
 
Among
 
BERRY PLASTICS GROUP, INC.,

BERRY PLASTICS HOLDING CORPORATION

 
and
 
CERTAIN OF ITS SUBSIDIARIES PARTY HERETO
 
as Borrowers,
 
THE LENDERS PARTY HERETO,
 
BANK OF AMERICA, N.A.,
 
as Collateral Agent and Administrative Agent,
 
GOLDMAN SACHS CREDIT PARTNERS L.P.,
 
as Syndication Agent,
 
CREDIT SUISSE SECURITIES (USA) LLC
CITIGROUP GLOBAL MARKETS INC.
DEUTSCHE BANK SECURITIES INC.
J.P. MORGAN SECURITIES INC.
LEHMAN BROTHERS INC.
 
as Co-Documentation Agents
 
BANC OF AMERICA SECURITIES LLC
CITIGROUP GLOBAL MARKETS INC.
CREDIT SUISSE SECURITIES (USA) LLC
DEUTSCHE BANK SECURITIES INC.
GOLDMAN SACHS CREDIT PARTNERS L.P.
J.P. MORGAN SECURITIES INC.
LEHMAN BROTHERS INC.
as Joint Bookrunners
_________________
 
BANC OF AMERICA SECURITIES LLC
 
and
 
GOLDMAN SACHS CREDIT PARTNERS L.P.
 
as Joint Lead Arrangers
 
_________________
 

 

 

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TABLE OF CONTENTS
Page
 
ARTICLE I
 
Definitions
 
SECTION 1.01.
Defined Term
 2
SECTION 1.02.
Terms Generally
 60
SECTION 1.03.
Effectuation of Transactions
 60
SECTION 1.04.
Exchange Rates; Currency Equivalents
 60
SECTION 1.05.
Senior Debt
 61

 
ARTICLE II
 
The Credits
 
SECTION 2.01.
Commitments
 61
SECTION 2.02.
Loans and Borrowings
 61
SECTION 2.03.
Requests for Borrowings
 62
SECTION 2.04.
Swingline Loans and Agent Advances
 63
SECTION 2.05.
Letters of Credit
 66
SECTION 2.06.
Funding of Borrowings
 72
SECTION 2.07.
Interest Elections
 72
SECTION 2.08.
Termination and Reduction of Commitments
 73
SECTION 2.09.
Repayment of Loans; Evidence of Debt
 73
SECTION 2.10.
Repayment of Revolving Loans
 74
SECTION 2.11.
Prepayment of Loans
 76
SECTION 2.12.
Fees
 76
SECTION 2.13.
Interest
 77
SECTION 2.14.
Alternate Rate of Interest
 78
SECTION 2.15.
Increased Costs
 78
SECTION 2.16.
Break Funding Payments
 79
SECTION 2.17.
Taxes
 80
SECTION 2.18.
Payments Generally; Pro Rata Treatment; Sharing of Set-offs
 82
SECTION 2.19.
Mitigation Obligations; Replacement of Lenders
 84
SECTION 2.20.
Illegality
 85
SECTION 2.21.
Incremental Commitments
 85

 
ARTICLE III
 
Representations and Warranties

SECTION 3.01.
Organization; Powers
 86
SECTION 3.02.
Authorization
 87
SECTION 3.03.
Enforceability
 87

 
 
 
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SECTION 3.04.
Governmental Approvals
 87
SECTION 3.05.
Financial Statements
 88
SECTION 3.06.
No Material Adverse Effect
 88
SECTION 3.07.
Title to Properties; Possession Under Leases
 88
SECTION 3.08.
Subsidiaries
 89
SECTION 3.09.
Litigation; Compliance with Laws
 89
SECTION 3.10.
Federal Reserve Regulations
 89
SECTION 3.11.
Investment Company Act
 90
SECTION 3.12.
Use of Proceeds
 90
SECTION 3.13.
Tax Returns
 90
SECTION 3.14.
No Material Misstatements
 90
SECTION 3.15.
Employee Benefit Plans
 91
SECTION 3.16.
Environmental Matters
 91
SECTION 3.17.
Security Documents
 92
SECTION 3.18.
Location of Real Property and Leased Premises
 93
SECTION 3.19.
Solvency
 93
SECTION 3.20.
Labor Matters
 94
SECTION 3.21.
Insurance
 94
SECTION 3.22.
No Default
 94
SECTION 3.23.
Intellectual Property; Licenses, Etc.
 94
SECTION 3.24.
Senior Debt
 95
SECTION 3.25.
Common Enterprise
 95

 
ARTICLE IV
 
Conditions of Lending

SECTION 4.01.
All Credit Events
 95
SECTION 4.02.
Effectiveness of Commitments
 96

 
ARTICLE V
 
Affirmative Covenants

SECTION 5.01.
Existence; Businesses and Properties
 99
SECTION 5.02.
Insurance
 100
SECTION 5.03.
Taxes
 101
SECTION 5.04.
Financial Statements, Reports, etc.
 101
SECTION 5.05.
Litigation and Other Notices
 104
SECTION 5.06.
Compliance with Laws
 104
SECTION 5.07.
Maintaining Records; Access to Properties and Inspections
 104
SECTION 5.08.
Use of Proceeds
 105
SECTION 5.09.
Compliance with Environmental Laws
 105
SECTION 5.10.
Further Assurances; Additional Security
 105
SECTION 5.12.
Appraisals and Reports
 107
SECTION 5.13.
Collateral Reporting
 108
SECTION 5.14.
Accounts
 108

 
 
 
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SECTION 5.15.
Collection of Accounts; Payments
 108
SECTION 5.16.
Inventory; Perpetual Inventory
 111

 
 
ARTICLE VI
 
Negative Covenants

SECTION 6.01.
Indebtedness
 112
SECTION 6.02.
Liens
 115
SECTION 6.03.
Sale and Lease-Back Transactions
 120
SECTION 6.04.
Investments, Loans and Advances
 120
SECTION 6.05.
Mergers, Consolidations, Sales of Assets and Acquisitions
 124
SECTION 6.06.
Dividends and Distributions
 127
SECTION 6.07.
Transactions with Affiliates
 129
SECTION 6.08.
Business of the Borrowers and the Subsidiaries
 132
SECTION 6.09.
Limitation on Modifications of Indebtedness; Modifications of Certificate of
Incorporation, By-Laws and Certain Other Agreements; etc.
 132
SECTION 6.10.
Fiscal Year; Accounting
 134
SECTION 6.11.
Availability Triggering Event
 134
SECTION 6.12.
Qualified CFC Holding Companies
 134

 
ARTICLE VIA
 
Holdings Negative Covenants
 
 
ARTICLE VII
 
Events of Default

SECTION 7.01.
Events of Default
 135
SECTION 7.02.
Exclusion of Immaterial Subsidiaries
 138
SECTION 7.03.
Holdings’ Right to Cure
 138

 
 
ARTICLE VIII
 
The Agents

SECTION 8.01.
Appointment
 139
SECTION 8.02.
Delegation of Duties
 141
SECTION 8.03.
Exculpatory Provisions
 142
SECTION 8.04.
Reliance by Administrative Agent
 142
SECTION 8.05.
Notice of Default
 143
SECTION 8.06.
Non-Reliance on Agents and Other Lenders
 143
SECTION 8.07.
Indemnification
 144
SECTION 8.08.
Agent in Its Individual Capacity
 144
SECTION 8.09.
Successor Administrative Agent
 145

 
 
 
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SECTION 8.10.
Agents and Arrangers
 145
SECTION 8.11.
[Reserved]
 145
SECTION 8.12.
Field Audit and Examination Reports; Disclaimer by Lenders
 145

 
ARTICLE IX
 
Miscellaneous

SECTION 9.01.
Notices; Communications
 146
SECTION 9.02.
Survival of Agreement
 147
SECTION 9.03.
Binding Effect
 148
SECTION 9.04.
Successors and Assigns
 148
SECTION 9.05.
Expenses; Indemnity
 152
SECTION 9.06.
Right of Set-off
 154
SECTION 9.07.
Applicable Law
 154
SECTION 9.08.
Waivers; Amendment
 154
SECTION 9.09.
Interest Rate Limitation
 156
SECTION 9.10.
Entire Agreement
 157
SECTION 9.11.
WAIVER OF JURY TRIAL
 157
SECTION 9.12.
Severability
 157
SECTION 9.13.
Counterparts
 157
SECTION 9.14.
Headings
 157
SECTION 9.15.
Jurisdiction; Consent to Service of Process
 158
SECTION 9.16.
Confidentiality
 158
SECTION 9.17.
Platform; Borrower Materials
 159
SECTION 9.18.
Release of Liens and Guarantees
 159
SECTION 9.19.
Judgment Currency
 160
SECTION 9.20.
USA PATRIOT Act Notice
 160
SECTION 9.21.
Joint and Several Liability
 160
SECTION 9.22.
Contribution and Indemnification among the Borrowers
 161
SECTION 9.23.
Agency of Company for Each Other Borrower
 162
SECTION 9.24.
Additional Borrowers
 162
SECTION 9.25.
Express Waivers By Borrowers In Respect of Cross Guaranties and Cross
Collateralization
 163
SECTION 9.26.
Intercreditor Agreements and Collateral Agreement
 164

 

 
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Exhibits and Schedules
 
Exhibit A
Form of Assignment and Acceptance

Exhibit B
Form of Solvency Certificate

Exhibit C-1
Form of Borrowing Request

Exhibit C-2
Form of Swingline Borrowing Request

Exhibit D
[Reserved]

Exhibit E
Form of Collateral Agreement

Exhibit F
Form of Borrowing Base Certificate

Schedule 1.01(a)
Certain U.S. Subsidiaries

Schedule 1.01(b)
Acceptable Appraisers

Schedule 1.01(c)
Mortgaged Properties

Schedule 1.01(d)
Immaterial Subsidiaries

Schedule 1.01(e)
Past Due Accounts

Schedule 1.01(f)
Existing Bankers’ Acceptances

Schedule 1.01(g)
Existing Letters of Credit

Schedule 1.01(i)
Unrestricted Subsidiaries

Schedule 2.01   Commitments

Schedule 3.01
Organization and Good Standing

Schedule 3.04
Governmental Approvals

Schedule 3.07(b)
Possession under Leases

Schedule 3.08(a)
Subsidiaries

Schedule 3.08(b)
Subscriptions

Schedule 3.13
Taxes

Schedule 3.16
Environmental Matters

Schedule 3.21
Insurance

Schedule 3.23
Intellectual Property

Schedule 4.02
Borrowing Base Calculation on Closing Date

Schedule 4.02(d)
Post-Closing Interest Deliveries

Schedule 6.01
Indebtedness

Schedule 6.02(a)
Liens

Schedule 6.04
Investments

Schedule 6.05
Mergers, Consolidations, Sales of Assets and Acquisitions

Schedule 6.07
Transactions with Affiliates

Schedule 9.01
Notice Information

 

 
 
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This AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT is entered into as of April
3, 2007 (this “Agreement”), among BERRY PLASTICS GROUP, INC., a Delaware
corporation (“Holdings”), COVALENCE SPECIALTY MATERIALS CORP., a Delaware
corporation (“Covalence”), which on the Closing Date shall be merged with and
into Berry Plastics Holding Corporation, a Delaware corporation (“Berry”), with
Berry surviving such merger (the “Company”), certain domestic Subsidiaries of
the Company party hereto from time to time, the LENDERS party hereto from time
to time, BANK OF AMERICA, N.A., as administrative agent (in such capacity, the
“Administrative Agent”) and collateral agent for the Lenders, GOLDMAN SACHS
CREDIT PARTNERS L.P., as syndication agent (in such capacity, the “Syndication
Agent”), and CITIGROUP GLOBAL MARKETS INC., CREDIT SUISSE SECURITIES (USA) LLC,
DEUTSCHE BANK SECURITIES INC., J.P. MORGAN SECURITIES INC., and LEHMAN BROTHERS
INC. as co-documentation agents (in such capacities, the “Documentation
Agents”).
 
WHEREAS, this Agreement has been titled the “Amended and Restated Revolving
Credit Agreement” for convenience of reference only and is, and is intended to
be, a new revolving credit agreement.
 
WHEREAS, Covalence Holdings, Covalence, the lenders and agents named therein,
and Bank of America, N.A., as administrative agent for such lenders, are parties
to that certain Revolving Credit Agreement dated as of May 18, 2006 (“the
“Existing Credit Agreement”);
 
WHEREAS Covalence Holdings, Covalence, the lenders and agents named therein, and
Bank of America, N.A., as administrative agent for such lenders are parties to
that certain Amended and Restated Credit Agreement, dated as of May 18, 2006
(the “Existing Term Loan Agreement”);
 
WHEREAS, Berry Holdings, BPC Acquisition Corp., which was merged with and into
Berry (formerly known as BPC Holding Corporation), the lenders and agents named
therein, and Credit Suisse, Cayman Islands Branch, as administrative agent and
collateral agent for such lenders, are parties to that certain Credit Agreement
dated as of September 20, 2006 (the “Berry Credit Agreement”);
 
WHEREAS, on the Closing Date, Berry and Covalence shall enter into a business
combination (the “Business Combination”) pursuant to which (i) immediately prior
to the effectiveness of this Agreement, Berry Holdings shall merge with and into
Covalence Holdings, and Covalence Holdings shall be renamed Berry Plastics
Group, Inc. (ii) substantially simultaneously with the effectiveness of this
Agreement, Covalence Holdings shall contribute all of the capital stock of Berry
to Covalence (the “Contribution”), and (iii) immediately following the
effectiveness of this Agreement, Covalence shall merge with and into Berry, with
Berry as the surviving corporation, pursuant to an Agreement and Plan of Merger
and Corporate Reorganization between Covalence and Holdings and Berry Holdings
dated March 9, 2007 (the “Merger Agreement”);
 
WHEREAS, in connection with the Business Combination, the Borrowers (as defined
below) desire to obtain from the Lenders a revolving credit facility in an
aggregate
 

Amended and Restated Revolving Credit Agreement

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principal amount at any time outstanding not in excess of $400 million (subject
to increases as permitted herein), the proceeds of which may be used (i) to
refinance the following (the “Refinancing”): (x) the “Revolving Loans” (as
defined in the Berry Credit Agreement); and (y) the “Loans” (as defined in the
Existing Credit Agreement), and (ii) for general corporate purposes.
 
NOW, THEREFORE, the Borrowers, the Lenders and the other parties hereto hereby
agree that, effective as of the Closing Date and upon fulfillment of the
conditions set forth herein, the Existing Credit Agreement is hereby amended and
restated in its entirety to read as follows:
 
 
ARTICLE I
 
 

 
 
Definitions
 
SECTION 1.01. Defined Terms. As used in this Agreement, the following terms
shall have the meanings specified below:
 
“ABL Fixed Charge Coverage Ratio” means the ratio of (a) EBITDA of the Company
for the most recent period of four consecutive fiscal quarters of the Company
for which financial statements are available minus the income taxes paid in cash
by the Company and included in the determination of Consolidated Net Income
during such period minus non-financed Capital Expenditures of the Company and
its Subsidiaries during such period to (b) the sum of (i) scheduled principal
payment required to be made during such period in respect of Indebtedness for
borrowed money plus (ii) the Consolidated Interest Expense (excluding
amortization of any original issue discount, interest paid in kind or added to
principal and other noncash interest) of the Company and its Subsidiaries for
such period plus (iii) Distributions pursuant to Sections 6.06(c) and (e) in
each case to the extent paid by the Company in cash.
 
For fiscal periods ending prior to the first full fiscal quarter after the
Closing Date, the ratio shall be calculated on a Pro Forma Basis giving effect
to the Transactions.
 
“ABR” shall mean, for any day, a fluctuating rate per annum equal to the higher
of (a) the Federal Funds Effective Rate plus 1/2 of 1% and (b) the rate of
interest in effect for such day as publicly announced from time to time by Bank
of America as its “prime rate.” The “prime rate” is a rate set by Bank of
America based upon various factors including Bank of America’s costs and desired
return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above or below
such announced rate. Any change in such rate announced by Bank of America shall
take effect at the opening of business on the day specified in the public
announcement of such change.
 
“ABR Borrowing” shall mean a Borrowing comprised of ABR Loans.
 
“ABR Loan” shall mean any ABR Revolving Loan, Swingline Loan or Agent Advance.
 
“ABR Revolving Facility Borrowing” shall mean a Borrowing comprised of ABR
Revolving Loans.
 

Amended and Restated Revolving Credit Agreement

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“ABR Revolving Loan” shall mean any Revolving Loan bearing interest at a rate
determined by reference to the ABR in accordance with the provisions of
Article II.
 
“Acceptable Appraiser” means (a) any person listed on Schedule 1.01(b), or
(b) any other experienced and reputable appraiser reasonably acceptable to the
Company and the Administrative Agent.
 
“Acceptance Credit” shall mean a commercial Letter of Credit in which the
applicable Issuing Bank engages with the beneficiary of such Letter of Credit to
accept a time draft.
 
“Acceptance Documents” shall mean such general acceptance agreements,
applications, certificates and other documents as the applicable Issuing Bank
may require in connection with the creation of Bankers’ Acceptances.
 
“Accommodation Payment” shall have the meaning assigned to such term in Section
9.22.
 
“Account” means, with respect to a person, any of such person’s now owned and
hereafter acquired or arising accounts, as defined in the UCC, including any
rights to payment for the sale or lease of goods or rendition of services,
whether or not they have been earned by performance, and “Accounts” means, with
respect to any such person, all of the foregoing.
 
“Account Debtor” means each person obligated on an Account.
 
“Acquisition Agreement” shall mean the Stock and Asset Purchase Agreement (as
amended by that certain Closing Agreement dated as of February 16, 2006) dated
as of December 20, 2005, among Tyco Group S.a.r.l., a Luxembourg company,
Covalence and, for purposes of Section 11.15 thereof only, Tyco International
Group S.A.
 
“Act” shall have the meaning assigned to such term in Section 9.20.
 
“Additional Mortgage” shall have the meaning assigned to such term in
Section 5.10(c).
 
“Adjusted LIBO Rate” shall mean, with respect to any Eurocurrency Borrowing for
any Interest Period, an interest rate per annum equal to (a) the LIBO Rate in
effect for such Interest Period divided by (b) one minus the Statutory Reserves
applicable to such Eurocurrency Borrowing, if any.
 
“Administrative Agent” shall have the meaning assigned to such term in the
introductory paragraph of this Agreement.
 
“Administrative Agent Fees” shall have the meaning assigned to such term in
Section 2.12(c).
 
“Administrative Questionnaire” shall mean an Administrative Questionnaire in a
form supplied by the Administrative Agent.
 

Amended and Restated Revolving Credit Agreement

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“Affiliate” shall mean, when used 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. For
purposes of clause (h) of the definition of Eligible Accounts, the term
“Affiliate”, however, with respect to any Loan Party or the Equity Investors,
shall exclude any Apollo Operating Company.
 
“Agent Advance Exposure” shall mean at any time the aggregate principal amount
of all outstanding Agent Advances at such time. The Agent Advance Exposure of
any Revolving Lender at any time shall mean its Pro Rata Share of the aggregate
Agent Advance Exposure at such time.
 
“Agent Advances” shall have the meaning assigned to such term in Section
2.04(d).
 
“Agents” shall mean the Administrative Agent and the Collateral Agent.
 
“Agreement” shall have the meaning assigned to such term in the Introductory
paragraph of this Agreement.
 
“Agreement Currency” shall have the meaning assigned to such term in Section
9.19.
 
“Allocable Amount” shall have the meaning assigned to such term in Section 9.22.
 
“Alternate Currency” shall mean, with respect to any Letter of Credit, Canadian
Dollars or Euros and any other currency other than Dollars as may be acceptable
to the Administrative Agent and the Issuing Bank with respect thereto in their
sole discretion.
 
“Alternate Currency Letter of Credit” shall mean any Letter of Credit
denominated in an Alternate Currency.
 
“Apollo Operating Company” means a person engaged in the business of producing
goods or providing services that but for the last sentence of the definition of
Affiliate would be an Affiliate of the Equity Investors.
 
“Applicable Margin” shall mean for any day prior to October 1, 2007, 1.25% per
annum in the case of any Eurocurrency Loan and 0.00% per annum in the case of
any ABR Loan and on and after October 1, 2007, the Applicable Margin will be
determined pursuant to the Pricing Grid.
 
“Applicable Period” means an Excess Cash Flow Period or an Excess Cash Flow
Interim Period, as the case may be.
 
“Approved Fund” shall have the meaning assigned to such term in Section 9.04(b).
 

Amended and Restated Revolving Credit Agreement

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“Asset Sale” shall mean any loss, damage, destruction or condemnation of, or any
sale, transfer or other disposition (including any sale and leaseback of assets
and any mortgage or lease of real property) to any person of any asset or assets
of the Company or any Subsidiary.
 
“Assignee” shall have the meaning assigned to such term in Section 9.04(b).
 
“Assignment and Acceptance” shall mean an assignment and acceptance entered into
by a Lender and an Assignee, and accepted by the Administrative Agent and the
Company (if required by such assignment and acceptance), in the form of
Exhibit A or such other form as shall be approved by the Administrative Agent.
 
“Availability” shall mean, at any time, (a) the Borrowing Base minus (b) the
Revolving Facility Credit Exposure.
 
“Availability Period” shall mean the period from and including the Closing Date
to but excluding the earlier of the Revolving Facility Maturity Date and the
date of termination of the Revolving Facility Commitments.
 
“Availability Triggering Event” shall mean that (a) except for purposes of
Sections 5.07, 5.12, 5.13 and 5.15, the Availability is less than the Threshold
Amount, or (b) for purposes of Section 5.07, 5.12, 5.13 and 5.15 only, the
Availability is less than the Threshold Amount for five consecutive Business
Days. Once occurred, an Availability Triggering Event shall be deemed to be
continuing until such time as the Availability is greater than the Threshold
Amount for 10 consecutive days.
 
“Available Unused Commitment” shall mean, with respect to a Revolving Lender at
any time, an amount equal to the amount by which (a) the Revolving Facility
Commitment of such Revolving Lender at such time exceeds (b) the Revolving
Facility Credit Exposure of such Revolving Lender at such time minus such
Revolving Lender’s Pro Rata Share of the Swingline Exposure and the Agent
Advance Exposure.
 
“Bank of America” means Bank of America, N.A. and its successors.
 
“Bankers’ Acceptance” or “BA” shall mean a time draft, drawn by the beneficiary
under an Acceptance Credit and accepted by the applicable Issuing Bank upon
presentation of documents by the beneficiary of an Acceptance Credit pursuant to
Section 2.05 hereof, in the standard form for bankers’ acceptances of such
Issuing Bank.
 
“Bankruptcy Code” means Title 11 of the United States Code (11 U.S.C. § 101
et seq.).
 
“BBA LIBOR” shall have the meaning assigned to such term in the definition of
“LIBO Rate” in this Section 1.01.
 
“Below Threshold Asset Sale Proceeds” shall have the meaning assigned to such
term in the definition of “Cumulative Credit” in this Section 1.01.
 

Amended and Restated Revolving Credit Agreement

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“Berry” shall have the meaning assigned to such term in the introductory
paragraph of this Agreement.
 
“Berry Credit Agreement” shall have the meaning assigned to such term in the
recitals hereto.
 
“Berry Holdings” shall mean Berry Plastics Group, Inc., which prior to the
Closing Date was merged with and into Covalence Holdings.
 
“Berry Senior Subordinated Note Documents” shall mean the Berry Senior
Subordinated Notes and the Berry Senior Subordinated Notes Indenture.
 
“Berry Senior Subordinated Notes” shall mean the 11% Senior Subordinated Notes
due 2016, issued pursuant to the Berry Senior Subordinated Notes Indenture and
any notes issued in exchange for, and as contemplated by, the Berry Senior
Subordinated Notes and the related registration rights agreement with
substantially identical terms as the Berry Senior Subordinated Notes.
 
“Berry Senior Subordinated Notes Indenture” shall mean the Indenture dated as of
September 20, 2006 under which the Berry Senior Subordinated Notes were issued,
among Berry and certain of its subsidiaries party thereto and the trustee named
therein from time to time, as in effect on the Closing Date and as amended,
restated, supplemented or otherwise modified from time to time in accordance
with the requirements thereof and of this Agreement.
 
“Blocked Account Agreement” means an agreement among one or more of the Loan
Parties, the Collateral Agent, and a Clearing Bank, in form and substance
reasonably satisfactory to the Collateral Agent, concerning the collection of
payments which represent the proceeds of Accounts and other Collateral of a Loan
Party.
 
“Board” shall mean the Board of Governors of the Federal Reserve System of the
United States of America.
 
“Board of Directors” means as to any person, the board of directors or other
governing body of such person, or, if such person is owned or managed by a
single entity, the board of directors or other governing body of such person.
 
“Borrower” means, the Company, those certain subsidiaries of the Company party
hereto, and any other person who becomes a party to this Agreement as a
“Borrower” pursuant to the terms hereof, jointly, severally, and collectively,
and “Borrowers” means more than one or all of the foregoing persons, jointly,
severally, and collectively, as the context requires.
 
“Borrower Materials” shall have the meaning assigned to such term in Section
9.17.
 
“Borrowing” shall mean all Revolving Loans of a single Type and made on a single
date and, in the case of Eurocurrency Loans, as to which a single Interest
Period is in effect. Unless the context indicates otherwise, the term
“Borrowing” shall also include any Swingline Borrowing and any Agent Advance.
 

Amended and Restated Revolving Credit Agreement

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“Borrowing Base” means, at any time, an amount equal to the lesser of
 
(a) the Revolving Facility Commitment, and
 
(b) the result of:
 
(i) the sum of (A) eighty-five percent (85.0%) of the Net Amount of Eligible
Accounts, and (B) eighty-five percent (85.0%) of the Orderly Liquidation Value
of Eligible Inventory, minus
 
(ii) all Reserves, without duplication of any items that are otherwise addressed
or excluded through eligibility criteria, which the Administrative Agent deems
necessary in the exercise of its Reasonable Credit Judgment to maintain with
respect to any Loan Party, including Reserves for any amounts which the
Administrative Agent or any Lender may be obligated to pay in the future for the
account of any Loan Party.
 
The specified percentages set forth in this definition will not be reduced
without the consent of the Company. Any determination by the Administrative
Agent in respect of the Borrowing Base shall be based on the Administrative
Agent’s Reasonable Credit Judgment. The parties understand that the exclusionary
criteria in the definitions of Eligible Accounts and Eligible Inventory, any
Reserves that may be imposed as provided herein, and Net Amount of Eligible
Accounts and factors considered in the calculation of Orderly Liquidation Value
of Eligible Inventory have the effect of reducing the Borrowing Base, and,
accordingly, whether or not any provisions hereof so state, all of the foregoing
shall be determined without duplication so as not to result in multiple
reductions in the Borrowing Base for the same facts or circumstances.
 
“Borrowing Base Certificate” means a certificate by a Responsible Officer of the
Company, substantially in the form of Exhibit F (or another form reasonably
acceptable to the Administrative Agent, including, on the Closing Date only,
Schedule 4.02) setting forth the calculation of the Borrowing Base, including a
calculation of each component thereof (including, to the extent the Company has
received notice of any such Reserve from the Administrative Agent, any of the
Reserves included in such calculation pursuant to clause (b)(ii) of the
definition of the Borrowing Base), all in such detail as shall be reasonably
satisfactory to the Administrative Agent.
 
“Borrowing Minimum” shall mean $5 million, except in the case of Swingline
Loans, $1 million.
 
“Borrowing Multiple” shall mean $1 million, except in the case of Swingline
Loans, $500,000.
 
“Borrowing Request” shall mean a request by a Borrower in accordance with the
terms of Section 2.03 and substantially in the form of Exhibit C-1.
 
“Budget” shall have the meaning assigned to such term in Section 5.04(e).
 

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“Business Day” shall mean any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed; provided, that when used in connection with a Eurocurrency Loan,
the term “Business Day” shall also exclude any day on which banks are not open
for dealings in deposits in the applicable currency in the London interbank
market.
 
“Business Combination” shall have the meaning assigned to such term in the
Recitals hereto.
 
“Capital Expenditures” shall mean, for any person in respect of any period, the
aggregate of all expenditures incurred by such person during such period that,
in accordance with GAAP, are or should be included in “additions to property,
plant or equipment” or similar items reflected in the statement of cash flows of
such person, provided, however, that Capital Expenditures for the Company and
the Subsidiaries shall not include:
 
(a) expenditures to the extent they are made with proceeds of the issuance of
Equity Interests of Holdings after the Closing Date or funds that would have
constituted any Net Proceeds under clause (a) of the definition of the term “Net
Proceeds” (but for the application of the first proviso to such clause (a)),
 
(b) expenditures with proceeds of insurance settlements, condemnation awards and
other settlements in respect of lost, destroyed, damaged or condemned assets,
equipment or other property to the extent such expenditures are made to replace
or repair such lost, destroyed, damaged or condemned assets, equipment or other
property or otherwise to acquire, maintain, develop, construct, improve, upgrade
or repair assets or properties useful in the business of the Company and the
Subsidiaries within 15 months of receipt of such proceeds (or, if not made
within such period of 15 months, are committed to be made during such period),
 
(c) interest capitalized during such period,
 
(d) expenditures that are accounted for as capital expenditures of such person
and that actually are paid for by a third party (excluding Holdings, the Company
or any Subsidiary thereof) and for which neither Holdings, the Company nor any
Subsidiary has provided or is required to provide or incur, directly or
indirectly, any consideration or obligation to such third party or any other
person (whether before, during or after such period),
 
(e) the book value of any asset owned by such person prior to or during such
period to the extent that such book value is included as a capital expenditure
during such period as a result of such person reusing or beginning to reuse such
asset during such period without a corresponding expenditure actually having
been made in such period; provided, that (i) any expenditure necessary in order
to permit such asset to be reused shall be included as a Capital Expenditure
during the period that such expenditure actually is made and (ii) such book
value shall have been included in Capital Expenditures when such asset was
originally acquired,
 

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(f) the purchase price of equipment purchased during such period to the extent
the consideration therefor consists of any combination of (i) used or surplus
equipment traded in at the time of such purchase and (ii) the proceeds of a
concurrent sale of used or surplus equipment, in each case, in the ordinary
course of business,
 
(g) Investments in respect of a Permitted Business Acquisition,
 
(h) the Business Combination, or
 
(i) the purchase of property, plant or equipment made within 15 months of the
sale of any asset to the extent purchased with the proceeds of such sale (or, if
not made within such period of 15 months, to the extent committed to be made
during such period).
 
“Capital Lease Obligations” of any person shall mean the obligations of such
person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such person under GAAP and, for purposes hereof,
the amount of such obligations at any time shall be the capitalized amount
thereof at such time determined in accordance with GAAP.
 
“Cash Interest Expense” shall mean, with respect to the Company and the
Subsidiaries on a consolidated basis for any period, Interest Expense for such
period, less the sum of, without duplication, (a) pay in kind Interest Expense
or other noncash Interest Expense (including as a result of the effects of
purchase accounting), (b) to the extent included in Interest Expense, the
amortization of any financing fees paid by, or on behalf of, the Company or any
Subsidiary, including such fees paid in connection with the Transactions, (c)
the amortization of debt discounts, if any, or fees in respect of Swap
Agreements and (d) cash interest income of Company and its Subsidiaries for such
period; provided, that Cash Interest Expense shall exclude any one time
financing fees, including those paid in connection with the Transactions, or
upon entering into any amendment of this Agreement.
 
For fiscal periods ending prior to the first full fiscal quarter after the
Closing Date, Cash Interest Expense shall be calculated on a Pro Forma Basis
giving effect to the Transactions.
 
“CD” and “Canadian Dollars” each shall mean the lawful currency of Canada.
 
A “Change in Control” shall be deemed to occur if:
 
(a) at any time, (i) Holdings shall fail to own, directly or indirectly,
beneficially and of record, 100% of the issued and outstanding Equity Interests
of the Company, (ii) a majority of the seats (other than vacant seats) on the
Board of Directors of Holdings shall at any time be occupied by persons who were
neither (A) nominated by the board of directors of Holdings or a Permitted
Holder, (B) appointed by directors so nominated nor (C) appointed by a Permitted
Holder or (iii) a “change of control” (or similar event) shall occur under the
Second Lien Notes Indenture, either of the Senior Subordinated Notes Indentures,
any Material Indebtedness or any Permitted Refinancing
 

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Indebtedness in respect of any of the foregoing or any Disqualified Stock (to
the extent the aggregate amount of the applicable Disqualified Stock exceeds
$35 million);
 
(b) at any time prior to a Qualified IPO, any combination of Permitted Holders
shall fail to own beneficially (within the meaning of Rule 13d-5 of the Exchange
Act as in effect on the Closing Date), directly or indirectly, in the aggregate
Equity Interests representing at least a majority of the aggregate ordinary
voting power represented by the issued and outstanding Equity Interests of
Holdings; or
 
(c) at any time after a Qualified IPO, any person or “group” (within the meaning
of Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934 as in effect
on the Closing Date), other than any combination of the Permitted Holders or any
“group” including any Permitted Holders, shall have acquired beneficial
ownership of 35% or more on a fully diluted basis of the voting interest in
Holdings’ Equity Interests and the Permitted Holders shall own, directly or
indirectly, less than such person or “group” on a fully diluted basis of the
voting interest in Holdings’ Equity Interests.
 
“Change in Law” shall mean (a) the adoption of any law, rule or regulation after
the Closing Date, (b) any change in law, rule or regulation or in the
interpretation or application thereof by any Governmental Authority after the
Closing Date or (c) compliance by any Lender or Issuing Bank (or, for purposes
of Section 2.15(b), by any Lending Office of such Lender or by such Lender’s or
Issuing Bank’s holding company, if any) with any written request, guideline or
directive (whether or not having the force of law) of any Governmental Authority
made or issued after the Closing Date.
 
“Charges” shall have the meaning assigned to such term in Section 9.09.
 
“Clearing Bank” means either Bank of America or any other banking institution
with whom a Payment Account has been established pursuant to a Blocked Account
Agreement.
 
“Closing Date” shall mean April 3, 2007.
 
“Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time and the regulations promulgated and rulings issued thereunder.
 
“Collateral” shall mean all the “Collateral” as defined in any Security Document
and shall also include the Mortgaged Properties and all other property that is
subject to any Lien in favor of the Collateral Agent or any Subagent for the
benefit of the Lenders pursuant to any Security Documents.
 
“Collateral Access Agreement” shall mean a landlord waiver, bailee letter or
similar acknowledgment, in form and substance reasonably satisfactory to the
Collateral Agent and containing such lien waivers, subordination provisions and
other agreements of any lessor, landlord, warehouseman or processor in
possession of Inventory, in each case reasonably required by the Collateral
Agent to preserve, protect and maintain the security interest (and the priority
of the security interest) of the Collateral Agent in such Inventory and executed
pursuant to the requirements set forth in clause (j) of the definition of
“Eligible Inventory”.
 

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“Collateral Agent” means the party acting as collateral agent for the Secured
Parties under the Security Documents. On the Closing Date, the Collateral Agent
is the same person as the Administrative Agent. Unless the context otherwise
requires, the term “Administrative Agent” as used herein shall, unless the
context otherwise requires, include the Collateral Agent, notwithstanding
various specific references to the Collateral Agent herein.
 
“Collateral Agent’s Liens” means the Liens in the Collateral granted to the
Collateral Agent, for the benefit of the Secured Parties, pursuant to the
Collateral Agreement and the other Loan Documents.
 
“Collateral Agreement” shall mean the Second Amended and Restated First Lien
Guarantee and Collateral Agreement, dated as of the date hereof, as amended,
supplemented or otherwise modified from time to time, in the form of Exhibit E,
among Holdings, the Company, each Subsidiary Loan Party, the Collateral Agent
and Credit Suisse as collateral agent.
 
“Collateral and Guarantee Requirement” shall mean the requirement that:
 
(a) on the Closing Date, the Collateral Agent shall have received (i) from
Holdings, the Company and each Subsidiary Loan Party, a counterpart of the
Collateral Agreement duly executed and delivered on behalf of such person and
(ii) an Acknowledgment and Consent in the form attached to the Collateral
Agreement, executed and delivered by each issuer of Pledged Collateral (as
defined in the Collateral Agreement), if any, that is not a Loan Party;
 
(b) on or before the Closing Date, (i) the Collateral Agent shall have received
(A) a pledge of all the issued and outstanding Equity Interests of (x) the
Company and (y) each Domestic Subsidiary (other than Subsidiaries listed on
Schedule 1.01(a)) owned on the Closing Date directly by or on behalf of the
Company or any Subsidiary Loan Party and (B) a pledge of 65% of the outstanding
Equity Interests of (1) each “first tier” Foreign Subsidiary directly owned by
any Loan Party (except for NIM Holdings Limited, Berry Plastics Asia Pte. Ltd.,
Ociesse s.r.l., Berry Plastics Acquisition Corporation II, and Berry Plastics
Acquisition Corporation XIV, LLC), and (2) each “first tier” Qualified CFC
Holding Company directly owned by any Loan Party and (ii) a collateral agent
under the Collateral Agreement, shall have received all certificates or other
instruments (if any) representing such Equity Interests, together with stock
powers or other instruments of transfer with respect thereto endorsed in blank;
 
(c) (i) all Indebtedness of the Company and each Subsidiary having, in the case
of each instance of Indebtedness, an aggregate principal amount in excess of $5
million (other than (A) intercompany current liabilities incurred in the
ordinary course of business in connection with the cash management operations of
Holdings and its Subsidiaries or (B) to the extent that a pledge of such
promissory note or instrument would violate applicable law) that is owing to any
Loan Party shall be evidenced by a promissory note or an instrument and shall
have been pledged pursuant to the Collateral Agreement (or other applicable
Security Document as reasonably required by the Administrative Agent) (which
pledge, in the case of any intercompany note evidencing debt owed by a Foreign
Subsidiary to a Loan Party, shall be limited to 65% of the amount
 

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outstanding thereunder), and (ii) Credit Suisse, as a collateral agent under the
Collateral Agreement shall have received all such promissory notes or
instruments, together with note powers or other instruments of transfer with
respect thereto endorsed in blank;
 
(d) in the case of any person that becomes a Subsidiary Loan Party after the
Closing Date, the Collateral Agent shall have received a supplement to each of
the Collateral Agreement, the Intercreditor Agreement and the Senior Lender
Intercreditor Agreement, in the form specified therein, duly executed and
delivered on behalf of such Subsidiary Loan Party;
 
(e) in the case of any person that becomes a “first tier” Foreign Subsidiary
directly owned by the Company or a Subsidiary Loan Party after the Closing Date,
the Collateral Agent shall have received, as promptly as practicable following a
request by the Collateral Agent, a Foreign Pledge Agreement, duly executed and
delivered on behalf of such Foreign Subsidiary and the direct parent company of
such Foreign Subsidiary;
 
(f) after the Closing Date, (i) all the outstanding Equity Interests of (A) any
person that becomes a Subsidiary Loan Party after the Closing Date and (B)
subject to Section 5.10(g), all the Equity Interests that are acquired by a Loan
Party after the Closing Date, shall have been pledged pursuant to the Collateral
Agreement; provided, that in no event shall more than 65% of the issued and
outstanding Equity Interests of any “first tier” Foreign Subsidiary or any
“first tier” Qualified CFC Holding Company directly owned by such Loan Party be
pledged to secure Obligations, and in no event shall any of the issued and
outstanding Equity Interests of any Foreign Subsidiary that is not a “first
tier” Foreign Subsidiary of a Loan Party or any Qualified CFC Holding Company
that is not a “first tier” Subsidiary of a Loan Party be pledged to secure
Obligations, and (ii) a collateral agent under the Collateral Agreement shall
have received all certificates or other instruments (if any) representing such
Equity Interests, together with stock powers or other instruments of transfer
with respect thereto endorsed in blank;
 
(g) except as otherwise contemplated by any Security Document, all documents and
instruments, including Uniform Commercial Code financing statements, required by
law or reasonably requested by the Collateral Agent to be filed, registered or
recorded to create the Liens intended to be created by the Security Documents
(in each case, including any supplements thereto) and perfect such Liens to the
extent required by, and with the priority required by, the Security Documents,
shall have been filed, registered or recorded or delivered to the Collateral
Agent for filing, registration or the recording concurrently with, or promptly
following, the execution and delivery of each such Security Document;
 
(h) within 90 days (or such longer period as the Administrative Agent may
determine) after the Closing Date, the Collateral Agent shall have received (i)
counterparts of each Mortgage to be entered into with respect to each Mortgaged
Property set forth on Schedule 1.01(c) duly executed and delivered by the record
owner of such Mortgaged Property and suitable for recording or filing and (ii)
such other documents including, but not limited to, any consents, agreements and
confirmations of
 

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third parties, as the Collateral Agent may reasonably request with respect to
any such Mortgage or Mortgaged Property;
 
(i) within 90 days (or such longer period as the Administrative Agent may
determine) after the Closing Date, the Collateral Agent shall have received,
except as otherwise set forth in clause (m) below, a policy or policies or
marked-up unconditional binder of title insurance or foreign equivalent thereof,
as applicable, paid for by the Borrowers, issued by a nationally recognized
title insurance company insuring the Lien of each Mortgage to be entered into on
or after the Closing Date as a valid first Lien on the Mortgaged Property
described therein, free of any other Liens except as permitted by Section 6.02
and Liens arising by operation of law, together with such customary endorsements
(including zoning endorsements where reasonably appropriate and available),
coinsurance and reinsurance as the Collateral Agent may reasonably request, and
with respect to any such property located in a state in which a zoning
endorsement is not available, a zoning compliance letter from the applicable
municipality in a form reasonably acceptable to the Collateral Agent;
 
(j) at or prior to delivery of any Mortgages, evidence of the insurance required
by the terms of the Mortgages;
 
(k) except as otherwise contemplated by any Security Document, each Loan Party
shall have obtained all consents and approvals required to be obtained by it in
connection with (i) the execution and delivery of all Security Documents (or
supplements thereto) to which it is a party and the granting by it of the Liens
thereunder and (ii) the performance of its obligations thereunder; and
 
(l) after the Closing Date, the Administrative Agent shall have received (i)
such other Security Documents as may be required to be delivered pursuant to
Section 5.10, and (ii) upon reasonable request by the Administrative Agent,
evidence of compliance with any other requirements of Section 5.10.
 
“Collateral Audit” shall have the meaning assigned to such term in Section 5.07.
 
“Commitment Fee” shall have the meaning assigned to such term in
Section 2.12(a).
 
“Commitments” shall mean (a) with respect to any Lender, such Lender’s Revolving
Facility Commitment (including any Incremental Revolving Facility Commitment),
and (b) with respect to any Swingline Lender, its Swingline Commitment.
 
“Company” shall have the meaning assigned to such term in the Recitals hereto.
 
“Conduit Lender” shall mean any special purpose corporation organized and
administered by any Lender for the purpose of making Loans otherwise required to
be made by such Lender and designated by such Lender in a written instrument;
provided, that the designation by any Lender of a Conduit Lender shall not
relieve the designating Lender of any of its obligations to fund a Loan under
this Agreement if, for any reason, its Conduit Lender fails to fund any such
Loan, and the designating Lender (and not the Conduit Lender) shall have the
sole
 

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right and responsibility to deliver all consents and waivers required or
requested under this Agreement with respect to its Conduit Lender; provided,
further, that no Conduit Lender shall (a) be entitled to receive any greater
amount pursuant to Section 2.15, 2.16, 2.17 or 9.05 than the designating Lender
would have been entitled to receive in respect of the extensions of credit made
by such Conduit Lender or (b) be deemed to have any Commitment.
 
“Consolidated Debt” at any date shall mean the sum of (without duplication) all
Indebtedness consisting of Capital Lease Obligations, Indebtedness for borrowed
money (other than letters of credit to the extent undrawn but including all
Bankers’ Acceptances issued under Acceptance Credits), Disqualified Stock and
Indebtedness in respect of the deferred purchase price of property or services
of the Company and the Subsidiaries determined on a consolidated basis on such
date in accordance with GAAP.
 
“Consolidated Interest Expense” means, with respect to any person for any
period, the sum, without duplication, of:
 
(i) consolidated interest expense of such person for such period, to the extent
such expense was deducted in computing Consolidated Net Income (including
amortization of original issue discount, the interest component of Capital Lease
Obligations, and net payments and receipts (if any) pursuant to interest rate
Hedging Obligations and excluding amortization of deferred financing fees and
expensing of any bridge or other financing fees);
 
(ii) consolidated capitalized interest of such person for such period, whether
paid or accrued; and
 
(iii) less interest income for such period.
 
“Consolidated Net Income” shall mean, with respect to any person for any period,
the aggregate of the Net Income of such person and its subsidiaries for such
period, on a consolidated basis; provided, however, that, without duplication,
 
(i)any net after-tax extraordinary, nonrecurring or unusual gains or losses or
income or expense or charge (less all fees and expenses relating thereto)
including, without limitation, any severance, relocation or other restructuring
expenses, any expenses relating to any reconstruction, recommissioning or
reconfiguration of fixed assets for alternative uses and fees, expenses or
charges relating to new product lines, plant shutdown costs, acquisition
integration costs, and fees, expenses or charges related to any offering of
Equity Interests of Holdings, any Investment, acquisition or Indebtedness
permitted to be incurred hereunder (in each case, whether or not successful),
including any such fees, expenses, charges or change in control payments related
to the Transactions (including any transition-related expenses incurred before,
on or after the Original Agreement Date), in each case, shall be excluded,
 
(ii)any net after-tax income or loss from discontinued operations and any net
after-tax gain or loss from disposed, abandoned, transferred, closed or
discontinued operations shall be excluded,
 

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(iii)any net after-tax gain or loss (less all fees and expenses or charges
relating thereto) attributable to business dispositions or asset dispositions
other than in the ordinary course of business (as determined in good faith by
the Board of Directors of the Company) shall be excluded,
 
(iv)any net after-tax income or loss (less all fees and expenses or charges
relating thereto) attributable to the early extinguishment of indebtedness shall
be excluded,
 
(v)(A) the Net Income for such period of any person that is not a subsidiary of
such person, or is an Unrestricted Subsidiary, or that is accounted for by the
equity method of accounting, shall be included only to the extent of the amount
of dividends or distributions or other payments paid in cash (or to the extent
converted into cash) to the referent person or a subsidiary thereof in respect
of such period and (B) the Net Income for such period shall include any ordinary
course dividend distribution or other payment in cash received from any person
in excess of the amounts included in clause (A),
 
(vi)Consolidated Net Income for such period shall not include the cumulative
effect of a change in accounting principles during such period,
 
(vii)any increase in amortization or depreciation or any one-time non-cash
charges resulting from purchase accounting (or similar accounting, in the case
of the Transactions) in connection with the Transactions or any acquisition that
is consummated after the Original Agreement Date shall be excluded,
 
(viii)any non-cash impairment charges or asset write-off resulting from the
application of GAAP, and the amortization of intangibles arising pursuant to
GAAP, shall be excluded,
 
(ix)any non-cash expenses realized or resulting from stock option plans,
employee benefit plans or post-employment benefit plans, grants of stock
appreciation or similar rights, stock options, restricted stock grants or other
rights to officers, directors and employees of such person or any of its
subsidiaries shall be excluded,
 
(x)accruals and reserves that are established within twelve months after the
Closing Date and that are so required to be established in accordance with GAAP
shall be excluded,
 
(xi)any expenses realized in respect of the obligations under Sections 2.9 or
5.4 of the Acquisition Agreement, shall in each case be excluded,
 
(xii) non-cash gains, losses, income and expenses resulting from fair value
accounting required by Statement of Financial Accounting Standards No. 133 shall
be excluded, and
 
(xiii) non-cash charges for deferred tax asset valuation allowances shall be
excluded.
 

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“Consolidated Total Assets” shall mean, as of any date, the total assets of the
Company and the consolidated Subsidiaries, determined in accordance with GAAP,
as set forth on the consolidated balance sheet of the Company as of such date.
 
“Contribution” shall have the meaning assigned to such term in the recitals
hereto.
 
“Control” shall mean 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 ownership of voting securities, by contract or otherwise, and
“Controlling” and “Controlled” shall have meanings correlative thereto.
 
“Covalence” shall have the meaning assigned to such term in the introductory
paragraph of this Agreement.
 
“Covalence Holdings” shall mean Covalence Specialty Materials Holding Corp.,
which immediately prior to the Closing Date was merged with Berry Holdings, with
Covalence Specialty Materials Holding Corp. surviving and being renamed Berry
Plastics Group, Inc.
 
“Covalence Senior Subordinated Note Documents” shall mean the Covalence Senior
Subordinated Notes and the Covalence Senior Subordinated Notes Indenture.
 
“Covalence Senior Subordinated Notes” shall mean the Company’s 10¼% Senior
Subordinated Notes due 2016, issued pursuant to the Covalence Senior
Subordinated Notes Indenture and any notes issued by the Company in exchange
for, and as contemplated by, the Covalence Senior Subordinated Notes and the
related registration rights agreement with substantially identical terms as the
Covalence Senior Subordinated Notes.
 
“Covalence Senior Subordinated Notes Indenture” shall mean the Indenture dated
as of February 16, 2006 among the Company and certain of the Subsidiaries party
thereto and the trustee named therein from time to time, as in effect on the
Closing Date and as amended, restated, supplemented or otherwise modified from
time to time in accordance with the requirements thereof and of this Agreement.
 
“Credit Event” shall have the meaning assigned to such term in Article IV.
 
“Credit Suisse” shall mean Credit Suisse, Cayman Islands Branch.
 
“Cumulative Credit” shall mean, at any date, an amount, not less than zero in
the aggregate, determined on a cumulative basis equal to, without duplication:
 
(a) $100.0 million, plus:
 
(b) the Cumulative Retained Excess Cash Flow Amount at such time, plus 
 
(c) the aggregate amount of proceeds received after the Original Agreement Date
and prior to such time that would have constituted Net Proceeds pursuant to
clause (a) of the definition thereof except for the operation of clause (A), (B)
or (C) of the second proviso thereof (the “Below Threshold Asset Sale
Proceeds”), plus 
 

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(d) the cumulative amount of proceeds (including cash and the fair market value
of property other than cash) from the sale of Equity Interests of Holdings or
any Parent Entity after the Original Agreement Date and on or prior to such time
(including upon exercise of warrants or options) which proceeds have been
contributed as common equity to the capital of the Company and common Equity
Interests of the Company issued upon conversion of Indebtedness of the Company
or any Subsidiary owed to a person other than the Company or a Subsidiary not
previously applied for a purpose other than use in the Cumulative Credit;
provided, that this clause (d) shall exclude Permitted Cure Securities and the
proceeds thereof, sales of Equity Interests financed as contemplated by Section
6.04(e) and any amounts used to finance the payments or distributions in respect
of any Junior Financing pursuant to Section 6.09(b), plus
 
(e) 100% of the aggregate amount of contributions to the common capital of the
Company received in cash (and the fair market value of property other than cash)
after the Original Agreement Date (subject to the same exclusions as are
applicable to clause (d) above); plus
 
(f) the principal amount of any Indebtedness (including the liquidation
preference or maximum fixed repurchase price, as the case may be, of any
Disqualified Stock) of the Company or any Subsidiary thereof issued after the
Original Agreement Date (other than Indebtedness issued to a Subsidiary), which
has been converted into or exchanged for Equity Interests (other than
Disqualified Stock) in Holdings or any Parent Entity, plus
 
(g) 100% of the aggregate amount received by the Company or any Subsidiary in
cash (and the fair market value of property other than cash received by the
Company or any Subsidiary) after the Original Agreement Date from:
 
(A) the sale (other than to the Company or any Subsidiary) of the Equity
Interests of an Unrestricted Subsidiary, or
 
(B) any dividend or other distribution by an Unrestricted Subsidiary, plus
 
(h) in the event any Unrestricted Subsidiary has been redesignated as a
Subsidiary or has been merged, consolidated or amalgamated with or into, or
transfers or conveys its assets to, or is liquidated into, Holdings, the Company
or any Subsidiary, the fair market value of the Investments of Holdings, the
Company or any Subsidiary in such Unrestricted Subsidiary at the time of such
Subsidiary Redesignation, combination or transfer (or of the assets transferred
or conveyed, as applicable), plus
 
(i) an amount equal to any returns (including dividends, interest,
distributions, returns of principal, profits on sale, repayments, income and
similar amounts) actually received by the Company or any Subsidiary in respect
of any Investments made pursuant to Section 6.04(j) (or the corresponding
provision of the senior secured bank credit facility then applicable to such
entity) after the Original Agreement Date, minus 
 
(j) any amounts thereof used to make Investments pursuant to Section 6.04(b)(y)
(or the corresponding provision of the senior secured bank credit facility then
applicable to such entity) after the Original Agreement Date prior to such time,
minus 
 

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(k) any amounts thereof used to make Investments pursuant to Section 6.04(j)(ii)
(or the corresponding provision of the senior secured bank credit facility then
applicable to such entity) after the Original Agreement Date prior to such time,
minus 
 
(l) the cumulative amount of dividends paid and distributions made pursuant to
Section 6.06(e) (or the corresponding provision of the senior secured bank
credit facility then applicable to such entity) after the Original Agreement
Date prior to such time, minus 
 
(m) payments or distributions in respect of Junior Financings pursuant to
Section 6.09(b)(i) (or the corresponding provision of the senior secured bank
credit facility then applicable to such entity) (other than payments made with
proceeds from the issuance of Equity Interests that were excluded from the
calculation of the Cumulative Credit pursuant to clause (d) above) after the
Original Agreement Date;
 
provided, however, for purposes of Section 6.06(e), the calculation of the
Cumulative Credit shall not include any Below Threshold Asset Sale Proceeds
except to the extent they are used as contemplated in clauses (j) and (k) above.
 
“Cumulative Retained Excess Cash Flow Amount” shall mean, at any date, an
amount, not less than zero in the aggregate, determined on a cumulative basis
equal to:
 
(a) the aggregate cumulative sum of the Retained Percentage of Excess Cash Flow
for all Excess Cash Flow Periods ending after the Original Agreement Date and
prior to such date, plus
 
(b) for each Excess Cash Flow Interim Period ended prior to such date but as to
which the corresponding Excess Cash Flow Period has not ended, an amount equal
to the Retained Percentage of Excess Cash Flow for such Excess Cash Flow Interim
Period, minus
 
(c) the cumulative amount of all Retained Excess Cash Flow Overfundings as of
such date.
 
“Cure Amount” shall have the meaning assigned to such term in Section 7.03(a).
 
“Cure Right” shall have the meaning assigned to such term in Section 7.03(a).
 
“Current Assets” shall mean, with respect to the Company and the Subsidiaries on
a consolidated basis at any date of determination, the sum of all assets (other
than cash and Permitted Investments or other cash equivalents and amounts
receivable under Sections 2.9 and 5.4 of the Acquisition Agreement) that would,
in accordance with GAAP, be classified on a consolidated balance sheet of the
Company and the Subsidiaries as current assets at such date of determination,
other than amounts related to current or deferred Taxes based on income or
profits.
 
“Current Liabilities” shall mean, with respect to the Company and the
Subsidiaries on a consolidated basis at any date of determination, all
liabilities that would, in accordance with GAAP, be classified on a consolidated
balance sheet of the Company and the
 

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Subsidiaries as current liabilities at such date of determination, other than
(a) the current portion of any Indebtedness, (b) accruals of Interest Expense
(excluding Interest Expense that is due and unpaid), (c) accruals for current or
deferred Taxes based on income or profits, (d) accruals, if any, of transaction
costs resulting from the Transactions and obligations under Sections 2.9 and 5.4
of the Acquisition Agreement, (e) accruals of any costs or expenses related to
(i) severance or termination of employees prior to the Original Agreement Date
or (ii) bonuses, pension and other post-retirement benefit obligations, and (f)
accruals for add-backs to EBITDA included in clauses (a)(iv) through (a)(vi) of
the definition of such term.
 
“Debt Service” shall mean, with respect to the Company and the Subsidiaries on a
consolidated basis for any period, Cash Interest Expense for such period plus
scheduled principal amortization of Consolidated Debt for such period.
 
“Default” shall mean any event or condition that upon notice, lapse of time or
both would constitute an Event of Default.
 
“Defaulting Lender” shall mean any Lender with respect to which a Lender Default
is in effect.
 
“Designated Non-Cash Consideration” mean the fair market value of non-cash
consideration received by the Company or one of its Subsidiaries in connection
with an Asset Sale that is so designated as Designated Non-Cash Consideration
pursuant to a certificate of a Responsible Officer, setting forth the basis of
such valuation, less the amount of cash equivalents received in connection with
a subsequent sale of such Designated Non-Cash Consideration.
 
“Disqualified Stock” shall mean, with respect to any person, any Equity
Interests of such person that, by its terms (or by the terms of any security or
other Equity Interests into which it is convertible or for which it is
redeemable or exchangeable), or upon the happening of any event or condition (a)
matures or is mandatorily redeemable (other than solely for Qualified Equity
Interests), 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 Commitments), (b) is
redeemable at the option of the holder thereof (other than solely for Qualified
Equity Interests), in whole or in part, (c) provides for the scheduled payments
of dividends in cash, or (d) is or becomes convertible into or exchangeable for
Indebtedness or any other Equity Interests that would constitute Disqualified
Stock, in each case, prior to the date that is ninety-one (91) days after the
Revolving Facility Maturity Date; provided, however, that only the portion of
the Equity Interests that so mature or are mandatorily redeemable, are so
convertible or exchangeable or are so redeemable at the option of the holder
thereof prior to such date shall be deemed to be Disqualified Stock;
provided further, however, that if such Equity Interests are issued to any
employee or to any plan for the benefit of employees of the Company or the
Subsidiaries or by any such plan to such employees, such Equity Interests shall
not constitute Disqualified Stock solely because they may be required to be
repurchased by the Company in order to satisfy applicable statutory or
regulatory obligations or as a result of such employee’s termination, death or
disability.
 

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“Distributions” shall have the meaning assigned to such term in Section 6.06.
 
“Documentation Agents” shall have the meaning assigned to such term in the
introductory paragraph of this Agreement.
 
“Dollar” and “$” means dollars in the lawful currency of the United States.
 
“Dollar Equivalent” 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 currency other than Dollars, the equivalent amount thereof in
Dollars as determined by the Administrative Agent at such time on the basis of
the Spot Rate (determined in respect of the most recent Revaluation Date or
other applicable date of determination) for the purchase of Dollars with such
currency.
 
“Domestic Subsidiary” shall mean any Subsidiary that is not a Foreign Subsidiary
or a Qualified CFC Holding Company or a subsidiary listed on Schedule 1.01(a).
 
“EBITDA” shall mean, with respect to the Company and the Subsidiaries on a
consolidated basis for any period, the Consolidated Net Income of the Company
and the Subsidiaries for such period plus (a) the sum of (in each case without
duplication and to the extent the respective amounts described in subclauses (i)
through (vii) of this clause (a) reduced such Consolidated Net Income (and were
not excluded therefrom) for the respective period for which EBITDA is being
determined):
 
(i)provision for Taxes based on income, profits or capital of the Company and
the Subsidiaries for such period, including, without limitation, state,
franchise and similar taxes,
 
(ii)Interest Expense of the Company and the Subsidiaries for such period (net of
interest income of the Company and its Subsidiaries for such period),
 
(iii)depreciation and amortization expenses of the Company and the Subsidiaries
for such period,
 
(iv)business optimization expenses and other restructuring charges (which, for
the avoidance of doubt, shall include, without limitation, the effect of
inventory optimization programs, plant closure, retention, severance, systems
establishment costs and excess pension charges); provided, that with respect to
each business optimization expense or other restructuring charge, the Company
shall have delivered to the Administrative Agent an officers’ certificate
specifying and quantifying such expense or charge,
 
(v)any other non-cash charges; provided, that, for purposes of this
subclause (v) of this clause (a), any non-cash charges or losses shall be
treated as cash charges or losses in any subsequent period during which cash
disbursements attributable thereto are made,
 

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(vi)the amount of management, consulting, monitoring, transaction and advisory
fees and related expenses paid to any Fund or any Fund Affiliates (or any
accruals related to such fees and related expenses) during such period;
provided, that such amount shall not exceed in any four quarter period the sum
of (i) the greater of $7.5 million and 2.0% of EBITDA for such four quarter
period, plus (ii) the amount of deferred fees (to the extent such fees would
otherwise have been permitted to be included in clause (i) if paid, but were not
included in such clause (i)), plus (iii) 2.0% of the value of transactions
permitted hereunder and entered into by the Company or any of the Subsidiaries
with respect to which any Fund or any Fund Affiliate provides any of the
aforementioned types of services, and
 
(vii)non-operating expenses.
 
minus (b) the sum of (without duplication and to the extent the amounts
described in this clause (b) increased such Consolidated Net Income for the
respective period for which EBITDA is being determined) non-cash items
increasing Consolidated Net Income of the Company and the Subsidiaries for such
period (but excluding any such items (A) in respect of which cash was received
in a prior period or will be received in a future period or (B) which represent
the reversal of any accrual of, or cash reserve for, anticipated cash charges in
any prior period).
 
For purposes of determining EBITDA under this Agreement for any quarter ending
prior to the first full quarter ending after the Closing Date, EBITDA for such
fiscal quarter shall be calculated on a Pro Forma Basis giving effect to the
Business Combination and the other Transactions occurring on the Closing Date.
 
“Eligible Accounts” means all Accounts of the Borrowers reflected in the most
recent Borrowing Base Certificate, except any Account with respect to which any
of the exclusionary criteria set forth below applies (unless the Administrative
Agent in its reasonable discretion elects to include such Account), such
excluded Accounts being any Account or Accounts:
 
(a) with respect to which more than 120 days have elapsed since the date of the
original invoice therefor or which is more than 60 days past due; provided that
Accounts listed on Schedule 1.01(e) (as updated from time to time by the Company
with the consent of the Administrative Agent (not to be unreasonably withheld or
delayed)) in an aggregate amount of not more than $5 million at any time shall
be ineligible pursuant to this clause (a) only if they are more than 60 days
past due or 180 days from the invoice date;
 
(b) that do not represent a bona fide indebtedness incurred in the amount of the
Account for goods sold or services rendered to, and accepted by, the applicable
Account Debtor; or that are not for a liquidated amount payable by the Account
Debtor on the terms then in effect for such Account; or for which payment has
been or will be received or credit, discount or extension, or agreement
therefor, or compromise, compounding or settlement thereof, has been or will be
granted, or any party liable thereon has been released, in each case other than
in the ordinary course of business consistent with past practice; or for which
invoices have not been issued or copies of any
 

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invoice with respect to such Account delivered to the Collateral Agent by any
Loan Party do not represent genuine copies of the original invoice sent to the
Account Debtor named therein;
 
(c) with respect to which Account (or any other Account due from such Account
Debtor), in whole or in part, a check, promissory note, draft, trade acceptance,
or other instrument for the payment of money has been received, presented for
payment, and returned uncollected for any reason;
 
(d) which represents a progress billing; provided that for the purposes hereof,
“progress billing” means any invoice for goods sold or leased or services
rendered under a contract or agreement pursuant to which the Account Debtor’s
obligation to pay such invoice is conditioned upon the applicable Borrower’s
completion of any further performance under the contract or agreement;
 
(e) with respect to which any one or more of the following events has occurred
to the Account Debtor on such Account: (i) death or judicial declaration of
incompetency of an Account Debtor who is an individual; (ii) the filing by or
against the Account Debtor of a request or petition for liquidation,
reorganization, arrangement, adjustment of debts, adjudication as a bankrupt,
winding-up, or other relief under the bankruptcy, insolvency, or similar laws of
the United States, any state or territory thereof, or any foreign jurisdiction,
now or hereafter in effect; (iii) the making of any general assignment by the
Account Debtor for the benefit of creditors; (iv) the appointment of a receiver
or trustee for the Account Debtor or for all or a substantial portion of the
assets of the Account Debtor, including, without limitation, the appointment of
or taking possession by a “custodian”, as defined in the Bankruptcy Code; (v)
the institution by or against the Account Debtor of any other type of insolvency
proceeding (under the Bankruptcy Code or otherwise) or of any formal or informal
proceeding for the dissolution or liquidation of, settlement of claims against,
or winding up of affairs of, the Account Debtor; (vi) the sale, assignment, or
transfer of all or substantially all of the assets of the Account Debtor (unless
the obligations under such Account are assumed by the successor); (vii) the
nonpayment generally by the Account Debtor of its debts as they become due; or
(viii) the cessation of the business of the Account Debtor as a going concern;
 
(f) if fifty percent (50.0%) or more of the aggregate Dollar amount of
outstanding Accounts owed at such time by the Account Debtor thereon is
classified as ineligible under clause (a) preceding;
 
(g) owed by an Account Debtor which: (i) is not organized under the laws of the
United States or Canada or any political subdivision, state, or province
thereof; or (ii) is the government of any foreign country or sovereign state, or
of any state, province, municipality, or other political subdivision thereof, or
of any department, agency, public corporation, or other instrumentality thereof;
except to the extent that such Account is insured by the Export-Import Bank of
the United States or secured or payable by a letter of credit satisfactory to
the Administrative Agent in its reasonable discretion;
 

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(h) which are Intercompany Accounts or other Accounts owed by an Account Debtor
which is an Affiliate or employee of any Borrower (not including, for the
avoidance of doubt, any Apollo Operating Company);
 
(i) except as agreed by the Administrative Agent as provided in clause (g)
preceding or clause (l) following regarding political subdivisions of the United
States but not the U.S. federal government, with respect to which either the
perfection, enforceability, or validity of the Collateral Agent’s Lien in such
Account, or the Collateral Agent’s right or ability to obtain direct payment to
the Collateral Agent of the proceeds of such Account, is governed by any
federal, state, or local statutory requirements other than those of the UCC;
except to the extent that such Account is insured by the Export-Import Bank of
the United States or secured or payable by a letter of credit satisfactory to
the Administrative Agent in its reasonable discretion;
 
(j) owed by an Account Debtor to which a Loan Party or any of their respective
Subsidiaries is indebted in any way, or which is subject to any right of set-off
or recoupment by the Account Debtor (but only to the extent of such
indebtedness, right of set-off or recoupment), unless the Account Debtor has
entered into an agreement acceptable to the Administrative Agent to waive
set-off rights; or if the Account Debtor thereon has disputed liability on such
Account or made any claim with respect to any other Account due from such
Account Debtor (but only to the extent of such disputed liability or claim); but
in each such case only if the aggregate amount of all such indebtedness,
set-offs, recoupments, disputes and claims with respect to all Eligible Accounts
exceeds $2 million, and then only to the extent of such aggregate indebtedness,
set-offs, recoupments, disputes and claims in excess of $2 million;
 
(k) with respect to which any Borrower at the time of determination deems such
Account as uncollectible;
 
(l) owed by any state of the United States or any municipality, or other
political subdivision, department, agency, public corporation, or other
instrumentality thereof, and as to which the Collateral Agent determines that
its Lien therein is not or cannot be perfected; except to the extent that such
Account is insured by the Export-Import Bank of the United States or secured or
payable by a letter of credit satisfactory to the Administrative Agent in its
reasonable discretion;
 
(m) which represents a sale on a bill-and-hold, guaranteed sale, sale and
return, sale on approval, consignment, or other repurchase or return basis;
 
(n) which is evidenced by a promissory note or other instrument or by chattel
paper;
 
(o) of any one Account Debtor or group of affiliated Account Debtors that are in
excess of (i) 35%, in the case of Wal-Mart Stores, Inc., its Affiliates and
subsidiaries, and (ii) 20% in the case of all other Account Debtors, of total
Eligible Accounts;
 

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(p) which arises out of a sale not made in the ordinary course of such
Borrower’s business except to the extent that the aggregate amount of such
Accounts outstanding does not exceed $2 million;
 
(q) with respect to which the goods giving rise to such Account have not been
shipped and delivered to, or have been rejected by, the Account Debtor or the
services giving rise to such Account have not been performed by the applicable
Borrower, and, if applicable, accepted by the Account Debtor, or the Account
Debtor revokes its acceptance of such goods or services, but, in each case, only
to the extent of the portion of such Account applicable to goods or services in
question;
 
(r) which arises out of an enforceable contract or order which, by its terms,
validly forbids, restricts, or makes void or unenforceable the granting of a
Lien by such Loan Party to the Collateral Agent with respect to such Account;
 
(s) which is not subject to a first priority and perfected security interest in
favor of the Collateral Agent, for the benefit of the Collateral Agent and the
Lenders, or which is subject to any other Lien other than Liens securing the
Second Lien Obligations and the Term Loan Obligations and Permitted Liens
arising by operation of law; and
 
(t) 30% of the value of each Account which is owed to a Newly Obligated Party
acquired in a Permitted Business Acquisition under this Agreement, for which the
Administrative Agent has not been given the opportunity for a reasonable period
(which shall not be required to be longer than thirty (30) days (or, in the case
of acquisitions of less than $50 million, twenty (20) days)) prior to and/or
after the closing of such acquisition to complete such due diligence as it
deems, in the exercise of Reasonable Credit Judgment, to be necessary in the
circumstances.
 
If any Account at any time ceases to be an Eligible Account, then such Account
shall promptly be excluded from the calculation of the Borrowing Base; provided,
however, that if any Account ceases to be an Eligible Account because of the
adjustment of or imposition of new exclusionary criteria pursuant to the
succeeding paragraph, the Administrative Agent will not require exclusion of
such Account from the Borrowing Base until 20 days following the date on which
the Administrative Agent gives notice to the Company of such ineligibility.
 
The Administrative Agent and the Collateral Agent reserve the right, at any time
and from time to time after the Closing Date, or upon reasonable request of the
Company upon completion and delivery to the Administrative Agent of field
examinations and appraisals in accordance with Section 5.12 (including, without
limitation, the Post-Closing Reports), to adjust any of the exclusionary
criteria set forth above and to establish new criteria, in their Reasonable
Credit Judgment (based on an analysis of material facts or events first
occurring, or first discovered by such Agents, in connection with the
preparation and review of the Post-Closing Reports or thereafter), subject,
after any adjustments based on the Post-Closing Reports, to the approval of
Required Lenders in the case of adjustments or new criteria which have the
effect of making more credit available than would have been available based upon
the criteria in effect.
 

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“Eligible Inventory” means all Inventory of the Borrowers reflected in the most
recent Borrowing Base Certificate, except any Inventory with respect to which
any of the exclusionary criteria set forth below applies (unless the
Administrative Agent in its reasonable discretion elects to include any such
Inventory):
 
(a) Inventory that is not owned by a Borrower;
 
(b) Inventory that is not subject to the Collateral Agent’s Liens, or is subject
to any other Lien (other than Permitted Liens arising by operation of law or the
Liens securing the Second Lien Obligations and the Term Loan Obligations);
provided that (unless such Permitted Liens (A) are junior in priority to the
Collateral Agent’s Liens (other than statutory landlord’s Liens to the extent
provided otherwise by a Requirement of Law) and (B) do not impair directly or
indirectly the ability of the Collateral Agent to realize on or obtain the full
benefit of the Collateral), the Administrative Agent may, in the exercise of
Reasonable Credit Judgment, establish a Reserve against availability with
respect to any Inventory subject to such Permitted Liens in an amount not to
exceed (on an aggregate basis for all Inventory from time to time subject to
such Permitted Liens) (A) in the case of Inventory subject to Liens described in
Section 6.02(e), the greater of (x) an amount equal to the amount which would
have to be paid to such Lien claimant in order to obtain a release of such
Liens, or (y) an amount equal to thirty (30) days’ rent for the properties or
facilities on or at which the applicable Inventory is located and (B) in the
case of Inventory subject to Liens described in Section 6.02(d), the amount of
such taxes, fees, assessments or other charges;
 
(c) Inventory that consists of packing and shipping materials (other than
finished goods inventory), or advertising or marketing materials (including
samples);
 
(d) Inventory that is unmerchantable, or the sale or other disposition of which
would contravene in any material respect any applicable laws or other
governmental rules or regulations, but only if such contravention would have a
material effect on the salability or value of such Inventory;
 
(e) Inventory that is not currently either usable or salable in the normal
course of the applicable Borrower’s business, as so identified according to the
Company’s accounting policy;
 
(f) Inventory that is slow-moving, obsolete or defective, as so identified
according to the Company’s accounting policy;
 
(g) Inventory that has been returned to a Borrower or a Subsidiary by a buyer or
held for return by a supplier (and is not held for resale);
 
(h) Inventory that is subject to any Lien permitted under Section 6.02(p) or
(bb) or any other Inventory financed by letters of credit or bankers’
acceptances for which the Collateral Agent does not have possession or control
of the documents of title;
 
 
(i) Inventory that is not located within the United States or Canada (or is
in-transit from vendors or suppliers, except that in-transit Inventory will not
be deemed
 

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ineligible if (i) in the case of in-transit inventory not located within the
United States or Canada, it has been paid for in advance of shipment and legal
ownership thereof has passed to the applicable Borrower as evidenced by
customary documents of title, and (ii) in the case of in-transit Inventory
located within the United States or Canada, legal ownership thereof has passed
to the applicable Borrower as evidenced by customary documents of title);
 
(j) Inventory that is (i) stored or located on property that is (A) leased to
the Borrower that owns such Inventory, or (B) owned or leased by a warehouseman
that has contracted with such Borrower to store such Inventory, or (ii) stored
with or otherwise in the possession of a bailee, provided that such Inventory
shall not be excluded if (1) the applicable Borrower shall have delivered to the
Collateral Agent a Collateral Access Agreement executed by such lessor or
warehouseman or bailee with respect to such property, (2) the Collateral Agent
has given its prior consent thereto, or (3) Reserves have been established with
respect thereto, in an amount (on an aggregate basis for all Inventory from time
to time so located or possessed) not to exceed (a) in the case of Inventory
located in a warehouse or leased facility, the greater of (x) an amount equal to
the amount which would have to be paid to such claimant in order to obtain a
release of any Permitted Lien held by such claimant, or (y) an amount equal to
thirty (30) days’ rent or storage fee for the warehouses or facilities on or at
which the applicable Inventory is located and (b) in the case of Inventory
otherwise in the possession of a bailee, the amount necessary to complete any
work being performed on such Inventory and/or to obtain a surrender of the
Inventory to the possession of the applicable Borrower or the Collateral Agent,
or, in any such case under this clause (3), such lesser amount as may be
approved by the Collateral Agent;
 
(k) if such Inventory contains or bears any Proprietary Rights licensed to a
Borrower by any third party, and the Administrative Agent shall not be able to
sell or otherwise dispose of such Inventory pursuant to Article VII or the terms
of the Collateral Agreement subject to the same rights and obligations as the
applicable Borrower pursuant to the contract with such licensor without
infringing the rights of the licensor of such Proprietary Rights or violating
any contract with such licensor (and without payment of any royalties other than
any royalties due with respect to the sale or disposition of such Inventory
pursuant to the existing license agreement), and, if the Administrative Agent
deems it necessary, such Borrower shall deliver to the Administrative Agent a
consent or sublicense agreement from such licensor in form and substance
reasonably acceptable to the Administrative Agent; and
 
(l) 20% of the total book value of Inventory that is owned by a Newly Obligated
Party acquired in a Permitted Business Acquisition under this Agreement, for
which the Administrative Agent has not been given the opportunity for a
reasonable period (which shall not be required to be longer than thirty (30)
days (or, in the case of acquisitions of less than $50 million, twenty (20)
days)) prior to and/or after the closing of such acquisition to complete such
due diligence as it deems, in the exercise of Reasonable Credit Judgment, to be
necessary in the circumstances.
 

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If any Inventory at any time ceases to be Eligible Inventory, such Inventory
shall promptly be excluded from the calculation of the Borrowing Base; provided,
however, that if any Inventory ceases to be Eligible Inventory because of the
adjustment of or imposition of new exclusionary criteria pursuant to the
succeeding paragraph, the Agents will not require exclusion of such Inventory
from the Borrowing Base until 20 days following the date on which the
Administrative Agent gives notice to the Company of such ineligibility.
 
The Administrative Agent and the Collateral Agent reserve the right, at any time
and from time to time after the Closing Date, or upon reasonable request of the
Company upon completion and delivery to the Administrative Agent of field
examinations and appraisals in accordance with Section 5.12 (including, without
limitation, the Post-Closing Reports), to adjust any of the exclusionary
criteria set forth above and to establish new criteria, in their Reasonable
Credit Judgment (based on an analysis of material facts or events first
occurring, or first discovered by such Agents, in connection with the
preparation and review of the Post-Closing Reports or thereafter), subject,
after any adjustments based on the Post-Closing Reports, to the approval of
Required Lenders in the case of adjustments or new criteria which have the
effect of making more credit available than would have been available based upon
the criteria in effect.
 
“EMU” means the economic and monetary union in accordance with the Treaty of
Rome 1957, as amended by the Single European Act 1986, the Maastricht Treaty of
1992 and the Amsterdam Treaty of 1998.
 
“EMU Legislation” means the legislative measures of the European Council for the
introduction of, changeover to or operation of a single or unified European
currency.
 
“environment” shall mean ambient and indoor air, surface water and groundwater
(including potable water, navigable water and wetlands), the land surface or
subsurface strata, natural resources such as flora and fauna, the workplace or
as otherwise defined in any Environmental Law.
 
“Environmental Laws” shall mean all applicable laws (including common law),
rules, regulations, codes, ordinances, orders, decrees or judgments, promulgated
or entered into by any Governmental Authority, relating in any way to the
environment, preservation or reclamation of natural resources, the generation,
management, Release or threatened Release of, or exposure to, any Hazardous
Material or to occupational health and safety matters (to the extent relating to
the environment or Hazardous Materials).
 
“Equity Interests” of any person shall mean any and all shares, interests,
rights to purchase or otherwise acquire, warrants, options, participations or
other equivalents of or interests in (however designated) equity or ownership of
such person, including any preferred stock, any limited or general partnership
interest and any limited liability company membership interest, and any
securities or other rights or interests convertible into or exchangeable for any
of the foregoing.
 
“Equity Investors” means one or more investment funds advised, managed or
controlled by Apollo Management V, L.P. Apollo Management VI, L.P., their
Affiliates, and any group in which any such Equity Investors are, in the
aggregate, a principal member.
 
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“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the
same may be amended from time to time and any final regulations promulgated and
the rulings issued thereunder.
 
“ERISA Affiliate” shall mean any trade or business (whether or not incorporated)
that, together with Holdings, the Company or a Subsidiary, is treated as a
single employer under Section 414(b) or (c) of the Code, or, solely for purposes
of Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.
 
“ERISA Event” shall mean (a) any Reportable Event or the requirements of Section
4043(b) of ERISA apply with respect to a Plan; (b) the existence with respect to
any Plan of an “accumulated funding deficiency” (as defined in Section 412 of
the Code or Section 302 of ERISA), whether or not waived; (c) the filing
pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan, the failure to make by its due date a required installment under
Section 412(m) of the Code with respect to any Plan or the failure to make any
required contribution to a Multiemployer Plan; (d) the incurrence by Holdings,
the Company, a Subsidiary or any ERISA Affiliate of any liability under Title IV
of ERISA with respect to the termination of any Plan or Multiemployer Plan; (e)
the receipt by Holdings, the Company, a Subsidiary or any ERISA Affiliate from
the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or to appoint a trustee to administer any Plan under
Section 4042 of ERISA; (f) the incurrence by Holdings, the Company, a Subsidiary
or any ERISA Affiliate of any liability with respect to the withdrawal or
partial withdrawal from any Plan or Multiemployer Plan; (g) the receipt by
Holdings, the Company, a Subsidiary or any ERISA Affiliate of any notice, or the
receipt by any Multiemployer Plan from Holdings, the Company, a Subsidiary or
any ERISA Affiliate of any notice, concerning the impending imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA; (h) the conditions for imposition of a lien under Section 302(f) of
ERISA shall have been met with respect to any Plan; or (i) the adoption of an
amendment to a Plan requiring the provision of security to such Plan pursuant to
Section 307 of ERISA.
 
“Euro” and “EUR” each shall mean the lawful currency of the Participating Member
States introduced in accordance with the EMU Legislation.
 
“Eurocurrency Borrowing” shall mean a Borrowing comprised of Eurocurrency Loans.
 
“Eurocurrency Loan” shall mean any Eurocurrency Revolving Loan.
 
“Eurocurrency Revolving Facility Borrowing” shall mean a Borrowing comprised of
Eurocurrency Revolving Loans.
 

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“Eurocurrency Revolving Loan” shall mean any Revolving Loan bearing interest at
a rate determined by reference to the Adjusted LIBO Rate in accordance with the
provisions of Article II.
 
“Event of Default” shall have the meaning assigned to such term in Section 7.01.
 
“Excess Cash Flow” shall mean, with respect to the Company and its Subsidiaries
on a consolidated basis for any Applicable Period, EBITDA of the Company and its
Subsidiaries on a consolidated basis for such Applicable Period, minus, without
duplication,
 
(a)Debt Service for such Applicable Period,
 
(b)the amount of any voluntary prepayment permitted hereunder (or, if made prior
to the Closing Date, permitted under the senior secured bank credit facility
then applicable to such entity) of term Indebtedness during such Applicable
Period (other than any voluntary prepayment of the Revolving Loans), so long as
the amount of such prepayment is not already reflected in Debt Service,
 
(c)(i) Capital Expenditures by the Company and the Subsidiaries on a
consolidated basis during such Applicable Period that are paid in cash (to the
extent permitted under this Agreement) and (ii) the aggregate consideration paid
in cash during the Applicable Period in respect of Permitted Business
Acquisitions and other Investments permitted hereunder less any amounts received
in respect thereof as a return of capital,
 
(d)Capital Expenditures that the Company or any Subsidiary shall, during such
Applicable Period, become obligated to make but that are not made during such
Applicable Period (to the extent permitted under this Agreement or if prior to
the Closing Date, the senior secured bank credit facility then applicable to
such entity); provided, that (i) Holdings shall deliver a certificate to the
Administrative Agent not later than 90 days after the end of such Applicable
Period, signed by a Responsible Officer of the Company and certifying that such
Capital Expenditures and the delivery of the related equipment will be made in
the following Applicable Period, and (ii) any amount so deducted shall not be
deducted again in a subsequent Applicable Period,
 
(e)Taxes paid in cash by Holdings and its Subsidiaries on a consolidated basis
during such Applicable Period or that will be paid within six months after the
close of such Applicable Period; provided, that with respect to any such amounts
to be paid after the close of such Applicable Period, (i) any amount so deducted
shall not be deducted again in a subsequent Applicable Period, and (ii)
appropriate reserves shall have been established in accordance with GAAP,
 
(f)an amount equal to any increase in Working Capital of the Company and its
Subsidiaries for such Applicable Period,
 
(g)cash expenditures made in respect of Swap Agreements during such Applicable
Period, to the extent not reflected in the computation of EBITDA or Interest
Expense,
 

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(h)permitted dividends or distributions or repurchases of its Equity Interests
paid in cash by the Company during such Applicable Period and permitted
dividends paid by any Subsidiary to any person other than Holdings, the Company
or any of the Subsidiaries during such Applicable Period, in each case in
accordance with Section 6.06 hereof (or the corresponding provision of the
senior secured bank credit facility then applicable to such entity) (other than
Section 6.06(e) or the corresponding provision of the senior secured bank credit
facility then applicable to such entity),
 
(i)amounts paid in cash during such Applicable Period on account of (A) items
that were accounted for as noncash reductions of Net Income in determining
Consolidated Net Income or as noncash reductions of Consolidated Net Income in
determining EBITDA of the Company and its Subsidiaries in a prior Applicable
Period and (B) reserves or accruals established in purchase accounting,
 
(j)to the extent not deducted in the computation of Net Proceeds in respect of
any asset disposition or condemnation giving rise thereto, the amount of any
mandatory prepayment of Indebtedness (other than Indebtedness created hereunder
or under any other Loan Document), together with any interest, premium or
penalties required to be paid (and actually paid) in connection therewith,
 
(k)the aggregate amount of items that were added to or not deducted from Net
Income in calculating Consolidated Net Income or were added to or not deducted
from Consolidated Net Income in calculating EBITDA to the extent such items
represented a cash payment (which had not reduced Excess Cash Flow upon the
accrual thereof in a prior Applicable Period), or an accrual for a cash payment,
by the Company and its Subsidiaries or did not represent cash received by the
Company and its Subsidiaries, in each case on a consolidated basis during such
Applicable Period, and
 
(l)amounts paid in cash during such Applicable Period in respect of obligations
under Sections 2.9 and 5.4 of the Acquisition Agreement,
 
plus, without duplication,
 
(i)an amount equal to any decrease in Working Capital for such Applicable
Period,
 
(ii)all amounts referred to in clauses (b), (c), (d) and (h) above to the extent
funded with the proceeds of the issuance or the incurrence of Indebtedness
(including Capital Lease Obligations and purchase money Indebtedness, but
excluding, solely as relating to Capital Expenditures, proceeds of Revolving
Loans (or, if prior to the Closing Date, revolving loans pursuant to the senior
secured bank credit facility then applicable to such entity)), the sale or
issuance of any Equity Interests (including any capital contributions) and any
loss, damage, destruction or condemnation of, or any sale, transfer or other
disposition (including any sale and leaseback of assets and any mortgage or
lease of Real Property) to any person of any asset or assets, in each case to
the extent there is a corresponding deduction from Excess Cash Flow above,
 

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(iii)to the extent any permitted Capital Expenditures referred to in clause (d)
above and the delivery of the related equipment do not occur in the following
Applicable Period of the Company specified in the certificate of the Company
provided pursuant to clause (d) above, the amount of such Capital Expenditures
that were not so made in such following Applicable Period,
 
(iv)cash payments received in respect of Swap Agreements during such Applicable
Period to the extent (i) not included in the computation of EBITDA or (ii) such
payments do not reduce Cash Interest Expense,
 
(v)any extraordinary or nonrecurring gain realized in cash during such
Applicable Period,
 
(vi)to the extent deducted in the computation of EBITDA, cash interest income,
and
 
(vii) the aggregate amount of items that were deducted from or not added to Net
Income in connection with calculating Consolidated Net Income or were deducted
from or not added to Consolidated Net Income in calculating EBITDA to the extent
either (i) such items represented cash received by the Company or any Subsidiary
or (ii) such items do not represent cash paid by the Company or any Subsidiary,
in each case on a consolidated basis during such Applicable Period.
 
“Excess Cash Flow Interim Period” shall mean, (x) during any Excess Cash Flow
Period, any one-, two-, or three-quarter period (a) commencing on the later of
(i) the end of the immediately preceding Excess Cash Flow Period and (ii) if
applicable, the end of any prior Excess Cash Flow Interim Period occurring
during the same Excess Cash Flow Period and (b) ending on the last day of the
most recently ended fiscal quarter (other than the last day of the Fiscal Year)
during such Excess Cash Flow Period for which financial statements are available
and (y) during the period from the Original Agreement Date until the beginning
of the first Excess Cash Flow Period, any period commencing on the Original
Agreement Date and ending on the last day of the most recently ended fiscal
quarter for which financial statements are available.
 
“Excess Cash Flow Period” shall mean (i) each fiscal year of the Company,
commencing with the first full fiscal year of the Company following the Closing
Date, and (ii) the period from January 1, 2007 through the day prior to the
initial fiscal year referred to in clause (i).
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
 
“Excluded Indebtedness” shall mean all Indebtedness permitted to be incurred
under Section 6.01(other than Section 6.01(v)).
 
“Excluded Taxes” shall mean, with respect to the Administrative Agent, any
Lender, any Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of any Borrower hereunder, (a) any income taxes
imposed on (or measured by) its net income (or franchise taxes imposed in lieu
of net income taxes) by the United States of America (or any state or locality
thereof) or the jurisdiction under the laws of which such
 

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recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable Lending Office is located or any
other jurisdiction as a result of such recipient engaging in a trade or business
in such jurisdiction for tax purposes, (b) any branch profits tax or any similar
tax that is imposed by any jurisdiction described in clause (a) above, (c) in
the case of a Lender making a Loan to any Borrower, any tax (including any
backup withholding tax) imposed by the United States (or the jurisdiction under
the laws of which such Lender is organized or in which its principal office is
located or in which its applicable Lending Office is located or any other
jurisdiction as a result of such Lender engaging in a trade or business or
having a taxable presence in such jurisdiction for tax purposes) that (x) is in
effect and would apply to amounts payable hereunder to such Lender at the time
such Lender becomes a party to such Loan to any Borrower (or designates a new
Lending Office) except to the extent that the assignor to such Lender in the
case of an assignment or the Lender in the case of a designation of a new
Lending Office (for the absence of doubt, other than the Lending Office at the
time such Lender becomes a party to such Loan) was entitled, at the time of such
assignment or designation of a new Lending Office, respectively, to receive
additional amounts from a Loan Party with respect to any withholding tax
pursuant to Section 2.17(a) or Section 2.17(c) or (y) is attributable to such
Lender’s failure to comply with Section 2.17(e) or (f) with respect to such Loan
and (d) any taxes that are imposed as a result of any event occurring after the
Lender becomes a Lender (other than a Change in Law) in the case of clause (a),
(b), (c), and (d), together with any and all interest and penalties related
thereto.
 
“Existing Bankers’ Acceptance” shall mean each of the bankers’ acceptances set
forth on Schedule 1.01(f).
 
“Existing Credit Agreement” shall have the meaning set forth in the recitals
hereto.
 
“Existing Letter of Credit” shall mean each of the letters of credit set forth
on Schedule 1.01(g).
 
“Existing Term Loan Agreement” shall have the meaning set forth in the recitals
hereto.
 
“Facility” shall mean the Revolving Facility.
 
“Federal Funds Effective Rate” shall mean, for any day, the rate per annum equal
to the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York on the Business
Day next succeeding such day; provided that (a) if such day is not a Business
Day, the Federal Funds Effective Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (b) if no such rate is so published on such next
succeeding Business Day, the Federal Funds Effective Rate for such day shall be
the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of
1%) charged to Bank of America on such day on such transactions as determined by
the Administrative Agent.
 

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“Fee Letter” shall mean that certain Fee Letter dated March 2, 2007 by and among
the Company, Bank of America, N.A., Banc of America Securities LLC, Citigroup
Global Markets Inc., Credit Suisse, Credit Suisse Securities (USA) LLC, Deutsche
Bank AG New York Branch, Deutsche Bank Securities Inc., Goldman Sachs Credit
Partners L.P., JPMorgan Chase Bank, N.A., J.P. Morgan Securities Inc. and Lehman
Brothers Inc.
 
“Fees” shall mean the Commitment Fees, the L/C Participation Fees, the Issuing
Bank Fees and the Administrative Agent Fees.
 
“Financial Officer” of any person shall mean the Chief Financial Officer,
principal accounting officer, Treasurer, Assistant Treasurer or Controller of
such person.
 
“First Lien Debt” at any date shall mean (i) the aggregate principal amount of
Consolidated Debt of the Company and its Subsidiaries outstanding at such date
that consists of, without duplication, Indebtedness that in each case is then
secured by first priority Liens on property or assets of the Company and its
Subsidiaries (other than property or assets held in a defeasance or similar
trust or arrangement for the benefit of the Indebtedness secured thereby), less
(ii) without duplication, the Unrestricted Cash and Permitted Investments of the
Company and its Subsidiaries on such date.
 
“Fiscal Period” means a calendar month.
 
“Foreign Pledge Agreement” shall mean a pledge agreement with respect to the
Pledged Collateral that constitutes Equity Interests of a “first tier” Foreign
Subsidiary, in form and substance reasonably satisfactory to the Collateral
Agent; provided, that in no event shall more than 65% of the issued and
outstanding Equity Interests of such Foreign Subsidiary be pledged to secure
Obligations of the Borrowers.
 
“Foreign Subsidiary” shall mean any Subsidiary that is incorporated or organized
under the laws of any jurisdiction other than the United States of America, any
State thereof or the District of Columbia.
 
“Fund Affiliates” shall mean (i) each Affiliate of any Funds, (ii) any
individual who is a partner or employee of Apollo Management, L.P., Apollo
Management IV, L.P. or Apollo Management V, L.P., Apollo Management VI, L.P.,
and (iii) Graham BPC Investment Holdings, LP.
 
“Fund I” shall mean Apollo Management V, L.P. and other affiliated co-investment
partnerships.
 
“Fund II” shall mean affiliates of Apollo Management VI, L.P. and other
affiliated co-investment partnerships and Graham Partners Inc.
 
“Fund Termination Fee” shall have the meaning specified in Section 6.07(b)(xiv).
 
“Funds” shall mean Fund I and Fund II, collectively.
 

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“GAAP” shall mean generally accepted accounting principles in effect from time
to time in the United States, applied on a consistent basis, subject to the
provisions of Section 1.02; provided that any reference to the application of
GAAP in Sections 3.13(b), 3.20, 5.03, 5.07 and 6.02(e) to a Foreign Subsidiary
(and not as a consolidated Subsidiary of the Company) shall mean generally
accepted accounting principles in effect from time to time in the jurisdiction
of organization of such Foreign Subsidiary.
 
“Governmental Authority” shall mean any federal, state, local or foreign court
or governmental agency, authority, instrumentality or regulatory or legislative
body.
 
“Guarantee” of or by any person (the “guarantor”) shall mean (a) any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (i) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation (whether arising by virtue of partnership
arrangements, by agreement to keep well, to purchase assets, goods, securities
or services, to take-or-pay or otherwise) or to purchase (or to advance or
supply funds for the purchase of) any security for the payment of such
Indebtedness or other obligation, (ii) to purchase or lease property, securities
or services for the purpose of assuring the owner of such Indebtedness or other
obligation of the payment thereof, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Indebtedness or other
obligation, (iv) entered into for the purpose of assuring in any other manner
the holders of such Indebtedness or other obligation of the payment thereof or
to protect such holders against loss in respect thereof (in whole or in part) or
(v) as an account party in respect of any letter of credit, bank guarantee,
bankers’ acceptance or other letter of guaranty issued to support such
Indebtedness or other obligation, or (b) any Lien on any assets of the guarantor
securing any Indebtedness (or any existing right, contingent or otherwise, of
the holder of Indebtedness to be secured by such a Lien) of any other person,
whether or not such Indebtedness or other obligation is assumed by the
guarantor; provided, however, the term “Guarantee” shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business or customary and reasonable indemnity obligations in effect on the
Closing Date or entered into in connection with any acquisition or disposition
of assets permitted by this Agreement (other than such obligations with respect
to Indebtedness). The amount of any Guarantee shall be deemed to be an amount
equal to the stated or determinable amount of the Indebtedness in respect of
which such Guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof (assuming such person is
required to perform thereunder) as determined by such person in good faith.
 
“guarantor” shall have the meaning assigned to such term in the definition of
the term “Guarantee.”
 
“Hazardous Materials” shall mean all pollutants, contaminants, wastes,
chemicals, materials, substances and constituents, including, without
limitation, explosive or radioactive substances or petroleum or petroleum
distillates, asbestos or asbestos containing materials, polychlorinated
biphenyls or radon gas, of any nature subject to regulation or which can give
rise to liability under any Environmental Law.
 

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“Hedging Obligations” means, with respect to any person, the obligations of such
person under (i) currency exchange, interest rate or commodity swap agreements,
currency exchange, interest rate or commodity cap agreements and currency
exchange, interest rate or commodity collar agreements, and (ii) other
agreements or arrangements designed to protect such person against fluctuations
in currency exchange, interest rates or commodity prices.
 
“Holdings” shall have the meaning assigned to such term in the introductory
paragraph of this Agreement.
 
“Immaterial Subsidiary” shall mean any Subsidiary that is not a Borrower and
that, as of the last day of the fiscal quarter of the Company most recently
ended, (a) did not have assets with a value in excess of 5.0% of the
Consolidated Total Assets or revenues representing in excess of 5.0% of total
revenues of the Company and the Subsidiaries on a consolidated basis as of such
date and (b) when taken together with all other Immaterial Subsidiaries as of
such date, did not have assets with a value in excess of 10.0% of the
Consolidated Total Assets or revenues representing in excess of 10.0% of total
revenues of the Company and the Subsidiaries on a consolidated basis as of such
date. Each Immaterial Subsidiary as of the Closing Date shall be set forth in
Schedule 1.01(d).
 
“Increased Amount Date” shall have the meaning assigned to such term in
Section 2.21.
 
“Incremental Amount” shall mean, at any time, the excess, if any, of (a) $150
million over (b) the aggregate amount of all Incremental Revolving Facility
Commitments established prior to such time pursuant to Section 2.21.
 
“Incremental Assumption Agreement” shall mean an Incremental Assumption
Agreement in form and substance reasonably satisfactory to the Administrative
Agent, among the Borrowers, the Administrative Agent and one or more Incremental
Revolving Lenders.
 
“Incremental Revolving Facility Commitment” shall mean any increased or
incremental Revolving Facility Commitment provided pursuant to Section 2.21.
 
“Incremental Revolving Lender” shall mean a Lender with a Revolving Facility
Commitment or an outstanding Revolving Loan as a result of an Incremental
Revolving Facility Commitment.
 
“Indebtedness” of any person shall mean, without duplication, (a) all
obligations of such person for borrowed money, (b) all obligations of such
person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such person under conditional sale or other title retention
agreements relating to property or assets purchased by such person, (d) all
obligations of such person issued or assumed as the deferred purchase price of
property or services, to the extent that the same would be required to be shown
as a long term liability on a balance sheet prepared in accordance with GAAP,
(e) all Capital Lease Obligations of such person, (f) all net payments that such
person would have to make in the event of an early termination, on the date
Indebtedness of such person is being determined, in respect of outstanding Swap
Agreements, (g) the principal component of all obligations, contingent or
otherwise, of such person as an account party in respect of letters of credit,
(h) the principal
 

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component of all obligations of such person in respect of bankers’ acceptances,
(i) all Guarantees by such person of Indebtedness described in clauses (a) to
(h) above) and (j) the amount of all obligations of such person with respect to
the redemption, repayment or other repurchase of any Disqualified Stock
(excluding accrued dividends that have not increased the liquidation preference
of such Disqualified Stock); provided, that Indebtedness shall not include (A)
trade payables, accrued expenses and intercompany liabilities arising in the
ordinary course of business, (B) prepaid or deferred revenue arising in the
ordinary course of business, (C) purchase price holdbacks arising in the
ordinary course of business in respect of a portion of the purchase prices of an
asset to satisfy unperformed obligations of the seller of such asset, (D)
earn-out obligations until such obligations become a liability on the balance
sheet of such person in accordance with GAAP or (E) obligations under Section
2.9 and 5.4 of the Acquisition Agreement. The Indebtedness of any person shall
include the Indebtedness of any partnership in which such person is a general
partner, other than to the extent that the instrument or agreement evidencing
such Indebtedness expressly limits the liability of such person in respect
thereof.
 
“Indemnified Taxes” shall mean all Taxes other than Excluded Taxes.
 
“Indemnitee” shall have the meaning assigned to such term in Section 9.05(b).
 
“Ineligible Institution” shall mean the persons identified in writing to the
Administrative Agent by the Company on the Closing Date, and as may be
identified in writing to the Administrative Agent by the Company from time to
time thereafter with the consent of the Administrative Agent (not to be
unreasonably withheld or delayed), by delivery of a notice thereof to the
Administrative Agent setting forth such person or persons (or the person or
persons previously identified to the Administrative Agent that are to be no
longer considered “Ineligible Institutions”).
 
“Information” shall have the meaning assigned to such term in Section 3.14(a).
 
“Information Memorandum” shall mean the Confidential Information Memorandum
dated March 13, 2007, as modified or supplemented prior to the Closing Date.
 
“Initial Pro Forma Adjustment” shall mean an amount equal to $2.75 million for
each quarterly period ending March 2006 and June 2006, $5.876 million for the
quarterly period ending September 2006, and $3.125 million for the quarterly
period ending December 2006.
 
“Intellectual Property Rights” shall have the meaning assigned to such term in
Section 3.23.
 
“Intercreditor Agreement” shall mean the Intercreditor Agreement by and among
Credit Suisse and Bank of America, as first lien agents, Wells Fargo Bank, N.A.,
as trustee, Holdings, the Company and the Subsidiary Loan Parties, as in effect
on the Closing Date.
 
“Intercompany Accounts” means all assets and liabilities, however arising, which
are due to any Loan Party from, which are due from any Loan Party to, or which
otherwise arise from any transaction by any Loan Party with, any Affiliate of
such Loan Party.
 

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“Interest Election Request” shall mean a request by a Borrower to convert or
continue a Revolving Facility Borrowing in accordance with Section 2.07.
 
“Interest Expense” shall mean, with respect to any person for any period, the
sum of (a) gross interest expense of such person for such period on a
consolidated basis, including (i) the amortization of debt discounts, (ii) the
amortization of all fees (including fees with respect to Swap Agreements)
payable in connection with the incurrence of Indebtedness to the extent included
in interest expense, (iii) the portion of any payments or accruals with respect
to Capital Lease Obligations allocable to interest expense and (iv) net payments
and receipts (if any) pursuant to interest rate Hedging Obligations, and (b)
capitalized interest of such person. For purposes of the foregoing, gross
interest expense shall be determined after giving effect to any net payments
made or received and costs incurred by the Company and the Subsidiaries with
respect to Swap Agreements.
 
“Interest Payment Date” shall mean, (a) with respect to any Eurocurrency Loan,
the last day of each Interest Period applicable to the Borrowing of which such
Loan is a part and, in the case of a Eurocurrency Borrowing with an Interest
Period of more than three months’ duration, each day that would have been an
Interest Payment Date had successive Interest Periods of three months’ duration
been applicable to such Borrowing and, in addition, the date of any refinancing
or conversion of such Borrowing with or to a Borrowing of a different Type, (b)
with respect to any ABR Loan, the last Business Day of each calendar quarter and
(c) with respect to any Swingline Loan or Agent Advance, the last Business Day
of each calendar month and on the Revolving Facility Maturity Date or, if
earlier, on the date on which the Revolving Facility Commitments of all the
Lenders shall be terminated as provided herein.
 
“Interest Period” shall mean, as to any Eurocurrency Borrowing, the period
commencing on the date of such Borrowing or on the last day of the immediately
preceding Interest Period applicable to such Borrowing, as applicable, and
ending on the numerically corresponding day (or, if there is no numerically
corresponding day, on the last day) in the calendar month that is 1, 2, 3 or 6
months thereafter (or 9 or 12 months, if at the time of the relevant Borrowing,
all Lenders make interest periods of such length available), as the Borrowers
may elect, or the date any Eurocurrency Borrowing is converted to an ABR
Borrowing in accordance with Section 2.07 or repaid or prepaid in accordance
with Section 2.09, 2.10 or 2.11; provided, however, that if any Interest Period
would end on a day other than a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless such next succeeding
Business Day would fall in the next calendar month, in which case such Interest
Period shall end on the next preceding Business Day. Interest shall accrue from
and including the first day of an Interest Period to but excluding the last day
of such Interest Period.
 
“Inventory” means, with respect to a person, all of such person’s now owned and
hereafter acquired inventory, as defined in the UCC, goods, and merchandise,
wherever located, in each case to be furnished under any contract of service or
held for sale or lease, all returned goods, raw materials, work-in-process,
finished goods (including embedded software), other materials, and supplies of
any kind, nature, or description which are used or consumed in such person’s
business or used in connection with the packing, shipping, advertising, selling,
or finishing of such goods, merchandise, and other property, and all documents
of title or other documents representing them.
 

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“Investment” shall have the meaning assigned to such term in Section 6.04.
 
“Issuing Bank” shall mean Bank of America, Credit Suisse, Deutsche Bank AG New
York Branch and each other Issuing Bank designated pursuant to Section 2.05(k),
in each case in its capacity as an issuer of Letters of Credit hereunder, and
its successors in such capacity as provided in Section 2.05(i). An Issuing Bank
may, in its discretion, arrange for one or more Letters of Credit to be issued
by Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall
include any such Affiliate with respect to Letters of Credit issued by such
Affiliate.
 
“Issuing Bank Fees” shall have the meaning assigned to such term in
Section 2.12(b).
 
“Joint Lead Arrangers” shall mean Banc of America Securities LLC and Goldman
Sachs Credit Partners L.P., in their capacities as joint lead arrangers.
 
“Judgment Currency” shall have the meaning assigned to such term in Section
9.19.
 
“Junior Financing” shall have the meaning assigned to such term in Section
6.09(b).
 
“L/C - BA Disbursement” shall mean (i) a payment or disbursement made by an
Issuing Bank pursuant to a Letter of Credit (other than an Acceptance Credit) or
(ii) a payment of a Bankers’ Acceptance upon presentation.
 
“L/C - BA Participation Fee” shall have the meaning assigned such term in
Section 2.12(b).
 
“Lender” shall mean each financial institution listed on Schedule 2.01, as well
as any person that becomes a “Lender” hereunder pursuant to Section 9.04. For
the avoidance of doubt, the term “Lender” includes the Swingline Lender and,
with respect to any Agent Advances, the Administrative Agent.
 
“Lender Default” shall mean (i) the refusal (which has not been retracted) of a
Lender to make available its portion of any Borrowing, to acquire participations
in a Swingline Loan or Agent Advance pursuant to Section 2.04 or to fund its
portion of any unreimbursed payment under Section 2.05(e), or (ii) a Lender
having notified the Company and/or the Administrative Agent in writing that it
does not intend to comply with its obligations under Section 2.04, 2.05 or 2.06.
 
“Lending Office” shall mean, as to any Lender, the applicable branch, office or
Affiliate of such Lender designated by such Lender to make Loans.
 
“Letter of Credit” shall mean any letter of credit and any bank guarantee issued
pursuant to Section 2.05, including any Acceptance Credit and any Alternate
Currency Letter of Credit. Each Existing Letter of Credit shall be deemed to
constitute a Letter of Credit issued hereunder on the Closing Date for all
purposes of the Loan Documents.
 

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“Letter of Credit Commitment” shall mean, with respect to each Issuing Bank, the
commitment of such Issuing Bank to issue Letters of Credit pursuant to Section
2.05.
 
“Letter of Credit Sublimit” shall mean the aggregate Letter of Credit
Commitments of the Issuing Banks, in an amount not to exceed $100 million (or
the equivalent thereof in an Alternate Currency).
 
“LIBO Rate” shall mean, with respect to any Eurocurrency Borrowing for any
Interest Period, the rate per annum equal to the British Bankers Association
LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other commercially
available source providing quotations of BBA LIBOR as designated by the
Administrative Agent from time to time) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, for
Dollar deposits (for delivery on the first day of such Interest Period) with a
term equivalent to such Interest Period; provided, that if such rate is not
available at such time for any reason, then the “LIBO Rate” for such Interest
Period shall be the rate per annum determined by the Administrative Agent to be
the rate at which deposits in Dollars for delivery on the first day of such
Interest Period in same day funds in the approximate amount of the Eurocurrency
Loan being made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of America’s London
Branch to major banks in the London interbank eurodollar market at their request
at approximately 11:00 a.m. (London time) two Business Days prior to the
commencement of such Interest Period.
 
“Lien” shall mean, with respect to any asset, (a) any mortgage, deed of trust,
lien, hypothecation, pledge, charge, security interest or similar encumbrance in
or on such asset and (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset, provided, that in no event shall an operating
lease or an agreement to sell be deemed to constitute a Lien.
 
“Loan Account” shall mean the loan account of the Borrowers, which account shall
be maintained by the Administrative Agent.
 
“Loan Documents” shall mean this Agreement, the Letters of Credit, the Security
Documents, the Intercreditor Agreement, the Senior Lender Intercreditor
Agreement and any Note issued under Section 2.09(e), and solely for the purposes
of Sections 4.02 and 7.01 hereof, the Fee Letter.
 
“Loan Parties” shall mean Holdings, the Borrowers and the Subsidiary Loan
Parties.
 
“Loans” shall mean the Revolving Loans, the Swingline Loans and the Agent
Advances.
 
“Local Time” shall mean New York City time.
 
“Management Group” means the group consisting of the directors, executive
officers and other management personnel of the Company, Holdings and their
Subsidiaries, as the case may be, on the Closing Date together with (a) any new
directors whose election by such
 

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boards of directors or whose nomination for election by the shareholders of the
Company or Holdings, as the case may be, was approved by a vote of a majority of
the directors of the Company or Holdings, as the case may be, then still in
office who were either directors on the Closing Date or whose election or
nomination was previously so approved and (b) executive officers and other
management personnel of the Company or Holdings and their Subsidiaries, as the
case may be, hired at a time when the directors on the Closing Date together
with the directors so approved constituted a majority of the directors of the
Company or Holdings, as the case may be.
 
“Margin Stock” shall have the meaning assigned to such term in Regulation U.
 
“Material Adverse Effect” shall mean a material adverse effect on the business,
property, operations or condition of the Company and its Subsidiaries, taken as
a whole, or the validity or enforceability of any of the material Loan Documents
or the rights and remedies of the Administrative Agent and the Lenders
thereunder.
 
“Material Indebtedness” shall mean Indebtedness (other than Loans and Letters of
Credit) of any one or more of the Company or any Subsidiary in an aggregate
principal amount exceeding $35 million.
 
“Material Subsidiary” shall mean any Subsidiary other than an Immaterial
Subsidiary.
 
“Maximum Rate” shall have the meaning assigned to such term in Section 9.09.
 
“Merger Agreement” shall have the meaning assigned to such term in the recitals
hereto.
 
“Merger Documents” shall mean the collective reference to the Merger Agreement,
all material exhibits and schedules thereto and all agreements expressly
contemplated thereby.
 
“Moody’s” shall mean Moody’s Investors Service, Inc.
 
“Mortgaged Properties” shall mean the Real Properties owned in fee by the Loan
Parties that are set forth on Schedule 1.01(c) and each additional Real Property
encumbered by a Mortgage pursuant to Section 5.10.
 
“Mortgages” shall mean the mortgages, trust deeds, deeds of trust, deeds to
secure debt, assignments of leases and rents, and other security documents
delivered with respect to Mortgaged Properties, each in form and substance
reasonably satisfactory to the Administrative Agent and the Company, as amended,
supplemented or otherwise modified from time to time. For the avoidance of
doubt, Mortgages may include mortgages delivered under the Existing Credit
Agreement to the extent amended to be in a form otherwise satisfactory to the
Administrative Agent.
 
“Multiemployer Plan” shall mean a multiemployer plan as defined in
Section 4001(a)(3) of ERISA to which the Company, Holdings or any Subsidiary or
any ERISA
 

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Affiliate (other than one considered an ERISA Affiliate only pursuant to
subsection (m) or (o) of Code Section 414) is making or accruing an obligation
to make contributions, or has within any of the preceding six plan years made or
accrued an obligation to make contributions.
 
“Net Amount of Eligible Accounts” means, at any time, the gross amount of
Eligible Accounts less sales, excise, or similar taxes, and less returns,
discounts, claims, credits, and allowances of any nature at any time issued,
owing, granted, outstanding, available, or claimed (in each case without
duplication, whether of the exclusionary criteria set forth in the definition of
Eligible Accounts, of any Reserve, or otherwise).
 
“Net Income” shall mean, with respect to any person, the net income (loss) of
such person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends.
 
“Net Proceeds” shall mean:
 
(a) 100% of the cash proceeds actually received by the Company or any Subsidiary
Loan Party (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise and including casualty insurance settlements
and condemnation awards, but only as and when received) from any Asset Sale
(other than those pursuant to Section 6.05(a), (b), (c), (d) (except as
contemplated by Section 6.03(b)), (e), (f), (h), (i) or (j)), net of (i)
attorneys’ fees, accountants’ fees, investment banking fees, survey costs, title
insurance premiums, and related search and recording charges, transfer taxes,
deed or mortgage recording taxes, required debt payments and required payments
of other obligations relating to the applicable asset to the extent such debt or
obligations are secured by a Lien permitted hereunder (other than pursuant to
the Loan Documents or the Term Loan Documents) on such asset, other customary
expenses and brokerage, consultant and other customary fees actually incurred in
connection therewith, (ii) Taxes paid or payable as a result thereof, and (iii)
the amount of any reasonable reserve established in accordance with GAAP against
any adjustment to the sale price or any liabilities (other than any taxes
deducted pursuant to clause (i) above) (x) related to any of the applicable
assets and (y) retained by the Company or any of the Subsidiaries including,
without limitation, pension and other post-employment benefit liabilities and
liabilities related to environmental matters or against any indemnification
obligations (however, the amount of any subsequent reduction of such reserve
(other than in connection with a payment in respect of any such liability) shall
be deemed to be Net Proceeds of such Asset Sale occurring on the date of such
reduction); provided, that, if no Event of Default exists and the Company shall
deliver a certificate of a Responsible Officer of the Company to the
Administrative Agent promptly following receipt of any such proceeds setting
forth the Company’s intention to use any portion of such proceeds, to acquire,
maintain, develop, construct, improve, upgrade or repair assets useful in the
business of the Company and the Subsidiaries or to make investments in Permitted
Business Acquisitions, in each case within 15 months of such receipt, such
portion of such proceeds shall not constitute Net Proceeds except to the extent
not, within 15 months of such receipt, so used or contractually committed to be
so used (it being
 

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understood that if any portion of such proceeds are not so used within such
15-month period but within such 15-month period are contractually committed to
be used, then upon the termination of such contract, such remaining portion
shall constitute Net Proceeds as of the date of such termination or expiry
without giving effect to this proviso); provided, further, that (A) no proceeds
realized in a single transaction or series of related transactions shall
constitute Net Proceeds unless such proceeds shall exceed $5.0 million, (B) no
proceeds shall constitute Net Proceeds in any fiscal year until the aggregate
amount of all such proceeds in such fiscal year shall exceed $10.0 million, (C)
at any time during the 15-month period contemplated by the immediately preceding
proviso above, if, on a Pro Forma Basis after giving effect to the Asset Sale
and the application of the proceeds thereof, the Total Net First Lien Leverage
Ratio is less than or equal to 2.00 to 1.00, up to $100 million of such proceeds
shall not constitute Net Proceeds, and
 
(b) 100% of the cash proceeds from the incurrence, issuance or sale by the
Borrowers or any Subsidiary Loan Party of any Indebtedness (other than Excluded
Indebtedness), net of all taxes and fees (including investment banking fees),
commissions, costs and other expenses, in each case incurred in connection with
such issuance or sale.
 
For purposes of calculating the amount of Net Proceeds, fees, commissions and
other costs and expenses payable to the Company or any Affiliate of the Company
shall be disregarded, except for financial advisory fees customary in type and
amount paid to Affiliates of the Funds and otherwise not prohibited from being
paid hereunder.
 
“New York Courts” shall have the meaning assigned to such term in Section
9.15(a).
 
“Newly Obligated Party” means each person, if any, who becomes party to this
Agreement as a Loan Party effective as of any date after the Closing Date.
 
“Non-Consenting Lender” shall have the meaning assigned to such term in
Section 2.19(c).
 
“Note” shall have the meaning assigned to such term in Section 2.09(e).
 
“Obligations” shall mean all amounts owing to the Administrative Agent or any
Lender pursuant to the terms of this Agreement or any other Loan Document.
 
“Orderly Liquidation Value” means an amount equal to the most recently
determined Orderly Liquidation Value Factor multiplied by the book value of all
Eligible Inventory of the Loan Parties.
 
“Orderly Liquidation Value Factor” means, with respect to Eligible Inventory of
the Loan Parties, the net orderly liquidation value thereof (expressed as a
percentage) as determined by an Acceptable Appraiser in accordance with Section
5.12; provided, that the Orderly Liquidation Value Factor as of the Closing Date
shall be 75% until otherwise determined in accordance with Section 5.12.
 

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“Original Agreement Date” shall mean February 16, 2006 in respect of the
subsidiaries of Covalence Holdings prior to the Closing Date, shall mean
September 20, 2006 in respect of subsidiaries of Berry Holdings prior to the
Closing Date, and shall mean the Closing Date in respect of subsidiaries of
Holdings that were not subsidiaries of Covalence Holdings or Berry Holdings
prior to the Closing Date.
 
“Other Taxes” shall mean any and all present or future stamp or documentary
taxes or any other excise, transfer, sales, property, intangible, mortgage
recording, or similar taxes, charges or levies arising from any payment made
hereunder or from the execution, delivery or enforcement of, or otherwise with
respect to, the Loan Documents, and any and all interest and penalties related
thereto (but not Excluded Taxes).
 
“Overdraft Line” shall have the meaning assigned to such term in Section
6.01(w).
 
“Parent Entity” means any direct or indirect parent of Holdings.
 
“Participant” shall have the meaning assigned to such term in
Section 9.04(c)(i).
 
“Participating Member State” means each state so described in any EMU
Legislation.
 
“Payment Account” means each bank account established or maintained pursuant to
Section 5.15, to which the funds of the Borrowers and their Subsidiaries
(including proceeds of Accounts and other Collateral) are deposited or credited,
and which is maintained in the name of the Collateral Agent or any Loan Party,
or any of them, as the Collateral Agent may determine, on terms acceptable to
the Collateral Agent.
 
“Pending Revolving Loans” means, at any time, the aggregate principal amount of
all Revolving Loans, Swingline Loans and Agent Advances requested in any
Borrowing Request received by the Administrative Agent or otherwise which have
not yet been advanced.
 
“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA.
 
“Perfection Certificate” shall mean the Perfection Certificate with respect to
Company and the other Loan Parties in a form reasonably satisfactory to the
Administrative Agent.
 
“Permitted Business Acquisition” shall mean any acquisition of all or
substantially all the assets of, or all the Equity Interests (other than
directors’ qualifying shares) in, or merger or consolidation with, a person or
division or line of business of a person (or any subsequent investment made in a
person, division or line of business previously acquired in a Permitted Business
Acquisition), if immediately after giving effect thereto: (i) no Event of
Default shall have occurred and be continuing or would result therefrom; (ii)
all transactions related thereto shall be consummated in accordance with
applicable laws; (iii) with respect to any such acquisition or investment with a
fair market value in excess of $20.0 million, the Company and its Subsidiaries
shall be in Pro Forma Compliance after giving effect to such acquisition or
 

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investment and any related transaction; (iv) any acquired or newly formed
Subsidiary shall not be liable for any Indebtedness except for Indebtedness
permitted by Section 6.01; (v) to the extent required by Section 5.10, any
person acquired in such acquisition, if acquired by a Borrower or a Domestic
Subsidiary, shall be merged into a Borrower or a Subsidiary Loan Party or become
upon consummation of such acquisition a Subsidiary Loan Party; and (vi) the
aggregate amount of such acquisitions and investments in assets that are not
owned by the Borrowers or Subsidiary Loan Parties or in Equity Interests in
persons that are not Subsidiary Loan Parties or persons that do not become
Subsidiary Loan Parties upon consummation of such acquisition shall not exceed
the greater (x) 4.5% of Consolidated Total Assets as of the end of the fiscal
quarter immediately prior to the date of such acquisition or investment for
which financial statements have been delivered pursuant to Section 5.04 and (y)
$150 million.
 
“Permitted Cure Securities” shall mean any equity securities of Holdings other
than Disqualified Stock and upon which all dividends or distributions (if any)
shall, prior to 91 days after the Revolving Facility Maturity Date, be payable
solely in additional shares of such equity security.
 
“Permitted Holder” shall mean each of (i) the Funds and the Fund Affiliates, and
(ii) the Management Group.
 
“Permitted Investments” shall mean:
 
(a)direct obligations of the United States of America or any member of the
European Union or any agency thereof or obligations guaranteed by the United
States of America or any member of the European Union or any agency thereof, in
each case with maturities not exceeding two years;
 
(b)time deposit accounts, certificates of deposit and money market deposits
maturing within 180 days of the date of acquisition thereof issued by a bank or
trust company that is organized under the laws of the United States of America,
any state thereof or any foreign country recognized by the United States of
America having capital, surplus and undivided profits in excess of $250 million
and whose long-term debt, or whose parent holding company’s long-term debt, is
rated A (or such similar equivalent rating or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act));
 
(c)repurchase obligations with a term of not more than 180 days for underlying
securities of the types described in clause (a) above entered into with a bank
meeting the qualifications described in clause (b) above;
 
(d)commercial paper, maturing not more than one year after the date of
acquisition, issued by a corporation (other than an Affiliate of any Borrower)
organized and in existence under the laws of the United States of America or any
foreign country recognized by the United States of America with a rating at the
time as of which any investment therein is made of P-1 (or higher) according to
Moody’s, or A-1 (or higher) according to S&P;
 

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(e)securities with maturities of two years or less from the date of acquisition
issued or fully guaranteed by any State, commonwealth or territory of the United
States of America, or by any political subdivision or taxing authority thereof,
and rated at least A by S&P or A by Moody’s;
 
(f)shares of mutual funds whose investment guidelines restrict 95% of such
funds’ investments to those satisfying the provisions of clauses (a) through (e)
above;
 
(g)money market funds that (i) comply with the criteria set forth in Rule 2a-7
under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by
Moody’s and (iii) have portfolio assets of at least $5,000.0 million; and
 
(h)time deposit accounts, certificates of deposit and money market deposits in
an aggregate face amount not in excess of 0.5% of the total assets of the
Company and the Subsidiaries, on a consolidated basis, as of the end of the
Company’s most recently completed fiscal year; and
 
(i)instruments equivalent to those referred to in clauses (a) through (h) above
denominated in any foreign currency comparable in credit quality and tenor to
those referred to above and commonly used by corporations for cash management
purposes in any jurisdiction outside the United States to the extent reasonably
required in connection with any business conducted by any Subsidiary organized
in such jurisdiction.
 
“Permitted Liens” shall have the meaning assigned to such term in Section 6.02.
 
“Permitted Refinancing Indebtedness” shall mean any Indebtedness issued in
exchange for, or the net proceeds of which are used to extend, refinance, renew,
replace, defease or refund (collectively, to “Refinance”), the Indebtedness
being Refinanced (or previous refinancings thereof constituting Permitted
Refinancing Indebtedness); provided, that (a) the principal amount (or accreted
value, if applicable) of such Permitted Refinancing Indebtedness does not exceed
the principal amount (or accreted value, if applicable) of the Indebtedness so
Refinanced (plus unpaid accrued interest and premium thereon and underwriting
discounts, fees, commissions and expenses), (b) except with respect to Section
6.01(i), the weighted average life to maturity of such Permitted Refinancing
Indebtedness is greater than or equal to the earlier of (i) the weighted average
life to maturity of the Indebtedness being Refinanced and (ii) 90 days after the
Revolving Facility Maturity Date, (c) if the Indebtedness being Refinanced is
subordinated in right of payment to the Obligations under this Agreement, such
Permitted Refinancing Indebtedness shall be subordinated in right of payment to
such Obligations on terms at least as favorable to the Lenders as those
contained in the documentation governing the Indebtedness being Refinanced, (d)
no Permitted Refinancing Indebtedness shall have different obligors, or greater
guarantees or security, than the Indebtedness being Refinanced and (e) if the
Indebtedness being Refinanced is secured by any collateral (whether equally and
ratably with, or junior to, the Secured Parties or otherwise), such Permitted
Refinancing Indebtedness may be secured by such collateral (including in respect
of working capital facilities of Foreign Subsidiaries otherwise permitted under
this Agreement only, any collateral pursuant to after-acquired property clauses
to the extent any such collateral secured the Indebtedness being Refinanced) on
terms no less favorable to the Secured Parties than those contained in the
 

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documentation governing the Indebtedness being Refinanced; provided further,
that with respect to a Refinancing of (x) the Senior Subordinated Notes or other
subordinated Indebtedness permitted to be incurred herein, such Permitted
Refinancing Indebtedness shall (i) be subordinated to the guarantee by Holdings
and the Subsidiary Loan Parties of the Revolving Facility, and (ii) be otherwise
on terms not materially less favorable to the Lenders than those contained in
the documentation governing the Indebtedness being refinanced and (y) the Second
Lien Notes, (i) the Liens, if any, securing such Permitted Refinancing
Indebtedness shall be subject to an intercreditor agreement that is
substantially consistent with and no less favorable to the Lenders in all
material respects than the Intercreditor Agreement and (ii) such Permitted
Refinancing Indebtedness shall be otherwise on terms not materially less
favorable to the Lenders than those contained in the documentation governing the
Indebtedness being Refinanced.
 
“person” shall mean any natural person, corporation, business trust, joint
venture, association, company, partnership, limited liability company or
government, individual or family trusts, or any agency or political subdivision
thereof.
 
“Plan” shall mean any employee pension benefit plan, as such term is defined in
Section 3(2) of ERISA, (other than a Multiemployer Plan), (i) subject to the
provisions of Title IV of ERISA, (ii) sponsored or maintained (at the time of
determination or at any time within the five years prior thereto) by Holdings,
the Company or any ERISA Affiliate, or (iii) in respect of which Holdings, the
Company, any Subsidiary or any ERISA Affiliate is (or, if such plan were
terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as
defined in Section 3(5) of ERISA.
 
“Platform” shall have the meaning assigned to such term in Section 9.17(b).
 
“Pledged Collateral” shall have the meaning assigned to such term in the
Collateral Agreement.
 
“Post-Closing Reports” shall mean field exam reports and appraisals with respect
to the Accounts and Inventory of the Loan Parties, in each case in form
customary for financings similar to this Agreement.
 

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“Pricing Grid” shall mean, with respect to the Revolving Loans, the table set
forth below:
 
 
 
Level
 
Quarterly Average Daily Availability
(as a percentage of the Borrowing Base)
Applicable Margin for ABR Loans
 
Applicable Margin for Eurocurrency Loans
 
I
 
Less than or equal to 25%
 
0.00%
 
1.75%
 
II
 
More than 25% but less than or equal to 50%
 
0.00%
 
1.50%
 
III
 
More than 50% but less than or equal to 75%
 
0.00%
 
1.25%
 
IV
 
More than 75%
 
0.00%
 
1.00%
 

 
For the purposes of the Pricing Grid, changes in the Applicable Margin shall
become effective on the first Business Day of each calendar quarter (to be
effective from such date until changed pursuant to the Pricing Grid), and shall
be determined in accordance with the Pricing Grid based on average daily
Availability during the immediately preceding fiscal quarter.
 
“primary obligor” shall have the meaning given such term in the definition of
the term “Guarantee.”
 
“Primary Payment Account” shall have the meaning assigned to such term in
Section 5.15(a).
 
“Pro Forma Adjusted EBITDA” shall have the meaning assigned to such term in
Section 3.05.
 
“Pro Forma Basis” shall mean, as to any person, for any events as described
below that occur subsequent to the commencement of a period for which the
financial effect of such events is being calculated, and giving effect to the
events for which such calculation is being made, such calculation as will give
pro forma effect to such events as if such events occurred on the first day of
the four consecutive fiscal quarter period ended on or before the occurrence of
such event (the “Reference Period”): (i) in making any determination of EBITDA,
effect shall be given to any Asset Sale, any acquisition (or any similar
transaction or transactions not otherwise permitted under Section 6.04 or 6.05
that require a waiver or consent of the Required Lenders and such waiver or
consent has been obtained), any dividend, distribution or other similar payment,
any designation of any Subsidiary as an Unrestricted Subsidiary and any
Subsidiary Redesignation, the Initial Pro Forma Adjustment for the quarters
ending March 2006,
 

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June 2006, September 2006, and December 2006, and any restructurings of the
business of the Company or any of its Subsidiaries that are expected to have a
continuing impact and are factually supportable, which would include cost
savings resulting from head count reduction, closure of facilities and similar
operational and other cost savings, which adjustments the Company determines are
reasonable as set forth in a certificate of a Financial Officer of the Company
(the foregoing, together with any transactions related thereto or in connection
therewith, the “relevant transactions”), in each case that occurred during the
Reference Period (or, in the case of determinations made pursuant to the
definition of the term “Permitted Business Acquisition” or pursuant to Sections,
6.01(r), 6.02(u) or 6.06(e), occurring during the Reference Period or thereafter
and through and including the date upon which the respective Permitted Business
Acquisition or incurrence of Indebtedness or Liens, Asset Sale, or dividend is
consummated), (ii) in making any determination on a Pro Forma Basis, (x) all
Indebtedness (including Indebtedness issued, incurred or assumed as a result of,
or to finance, any relevant transactions and for which the financial effect is
being calculated, whether incurred under this Agreement or otherwise, but
excluding normal fluctuations in revolving Indebtedness incurred for working
capital purposes, in each case not to finance any acquisition) issued, incurred,
assumed or permanently repaid during the Reference Period (or, in the case of
determinations made pursuant to the definition of the term “Permitted Business
Acquisition” or pursuant to Sections 6.01(r), 6.02(u) or 6.06(e), occurring
during the Reference Period or thereafter and through and including the date
upon which the respective Permitted Business Acquisition or incurrence of
Indebtedness or Liens, Asset Sale, or dividend is consummated) shall be deemed
to have been issued, incurred, assumed or permanently repaid at the beginning of
such period and (y) Interest Expense of such person attributable to interest on
any Indebtedness, for which pro forma effect is being given as provided in
preceding clause (x) (A) bearing floating interest rates shall be computed on a
pro forma basis as if the rate in effect on the date of such calculation had
been the applicable rate for the entire period (taking into account any Hedging
Obligations applicable to such Indebtedness if such Hedging Obligation has a
remaining term in excess of 12 months), and (B) in respect of a Capital Lease
Obligation shall be deemed to accrue at an interest rate reasonably determined
by a responsible financial or accounting officer of the Company to be the rate
of interest implicit in such Capital Lease Obligation in accordance with GAAP;
and (iii) (A) any Subsidiary Redesignation then being designated, effect shall
be given to such Subsidiary Redesignation and all other Subsidiary
Redesignations after the first day of the relevant Reference Period and on or
prior to the date of the respective Subsidiary Redesignation then being
designated, collectively, and (B) any designation of a Subsidiary as an
Unrestricted Subsidiary, effect shall be given to such designation and all other
designations of Subsidiaries as Unrestricted Subsidiaries after the first day of
the relevant Reference Period and on or prior to the date of the then applicable
designation of a Subsidiary as an Unrestricted Subsidiary, collectively.
 
Calculations made pursuant to the definition of the term “Pro Forma Basis” shall
be determined in good faith by a Responsible Officer of the Company and may
include adjustments to reflect (1) operating expense reductions and other
operating improvements or synergies reasonably expected to result from such
relevant transaction, which adjustments are reasonably anticipated by the
Company to be realizable in connection with such relevant transaction (or any
similar transaction or transactions made in compliance with this Agreement or
that require a waiver or consent of the Required Lenders), and are estimated on
a good faith basis by the Company, and (2) all adjustments reflected in the Pro
Forma Financial Statements
 

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and Pro Forma Adjusted EBITDA to the extent such adjustments, without
duplication, continue to be applicable. The Company shall deliver to the
Administrative Agent a certificate of a Financial Officer of the Company setting
forth such demonstrable or additional operating expense reductions and other
operating improvements or synergies and information and calculations supporting
them in reasonable detail.
 
“Pro Forma Compliance” shall mean, at any date of determination, that (a) either
(i) the Availability is equal to or greater than $100 million immediately before
and after giving effect to the relevant transactions (including the assumption,
issuance, incurrence and repayment of Indebtedness), or (ii)(A) the Company and
its Subsidiaries shall be in compliance, on a Pro Forma Basis after giving
effect on a Pro Forma Basis to the relevant transactions, with an ABL Fixed
Charge Coverage Ratio of at least 1:00 to 1:00 recomputed as at the last day of
the most recently ended fiscal quarter of the Company and its Subsidiaries for
which the financial statements and certificates required pursuant to Section
5.04 have been delivered, and (B) the Availability on a Pro Forma Basis is at
least $60 million immediately before and after giving effect to the relevant
transactions; and (b) and the Borrowers shall have delivered to the
Administrative Agent a certificate of a Responsible Officer of the Borrowers to
such effect, together with all relevant financial information.
 
“Pro Forma Financial Statements” shall have the meaning assigned to such term in
Section 3.05(a).
 
“Pro Rata Share” means, with respect to a Lender, a fraction (expressed as a
percentage), the numerator of which is the amount of such Lender’s Revolving
Facility Commitment and the denominator of which is the sum of the amounts of
all of the Lenders’ Revolving Facility Commitments, or if no Revolving Facility
Commitments are outstanding, a fraction (expressed as a percentage), the
numerator of which is the principal amount of Obligations owed to such Lender
and the denominator of which is the aggregate principal amount of the
Obligations owed to the Lenders, in each case giving effect to a Lender’s
participation in Swingline Loans and Agent Advances.
 
“Projections” shall mean the projections of Holdings, the Company and the
Subsidiaries included in the Information Memorandum and any other projections
and any forward-looking statements (including statements with respect to booked
business) of such entities furnished to the Lenders or the Administrative Agent
by or on behalf of Holdings, the Company or any of the Subsidiaries prior to the
Closing Date.
 
“Proprietary Rights” means, with respect to a person, all of such person’s now
owned and hereafter arising or acquired licenses, franchises, permits, patents,
patent rights, copyrights, works which are the subject matter of copyrights,
trademarks, service marks, trade names, trade styles, patent, trademark and
service mark applications, and all licenses and rights related to any of the
foregoing, and all other rights under any of the foregoing, all extensions,
renewals, reissues, divisions, continuations, and continuations-in-part of any
of the foregoing, and all rights to sue for past, present, and future
infringement of any of the foregoing.
 
“Public Lender” shall have the meaning assigned to such term in Section 9.17.

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“Qualified CFC Holding Company” shall mean a Wholly Owned Subsidiary of the
Company that is a limited liability company, that (a) is in compliance with
Section 6.12 and (b) the primary asset of which consists of Equity Interests in
either (i) a Foreign Subsidiary or (ii) a limited liability company that is in
compliance with Section 6.12 and the primary asset of which consists of Equity
Interests in a Foreign Subsidiary.

“Qualified Equity Interests” means any Equity Interest other than Disqualified
Stock.
 
“Qualified IPO” shall mean an underwritten public offering of the Equity
Interests of Holdings (or any Parent Entity) which generates cash proceeds of at
least $50 million.
 
“Real Property” means, collectively, all right, title and interest (including
any leasehold estate) in and to any and all parcels of or interests in real
property owned in fee or leased by any Loan Party, together with, in each case,
all easements, hereditaments and appurtenances relating thereto, all
improvements and appurtenant fixtures incidental to the ownership or lease
thereof.
 
“Reasonable Credit Judgment” means reasonable credit judgment in accordance with
customary business practices for comparable asset-based lending transactions and
as it relates to the establishment of Reserves or the adjustment or imposition
of exclusionary criteria shall require that, (x) such establishment, adjustment
or imposition after the Closing Date be based on the analysis of facts or events
relating to the Accounts, Inventory or other components of the Borrowing Base
first occurring or first discovered by the Administrative Agent after the
Closing Date or that are materially different from facts or events occurring or
known to the Administrative Agent on the Closing Date, (y) the contributing
factors to the imposition of any Reserve shall not duplicate (i) the
exclusionary criteria set forth in definitions of “Eligible Accounts” and
“Eligible Inventory”, as applicable (and vice versa) or (ii) any reserves
deducted in computing book value and (z) the amount of any such Reserve so
established or the effect of any adjustment or imposition of exclusionary
criteria be a reasonable quantification of the incremental dilution of the
Borrowing Base attributable to such contributing factors.
 
“Reference Period” shall have the meaning assigned to such term in the
definition of the term “Pro Forma Basis.”
 
“Refinance” shall have the meaning assigned to such term in the definition of
the term “Permitted Refinancing Indebtedness,” and “Refinanced” shall have a
meaning correlative thereto.
 
“Refinancing” shall have the meaning set forth in the recitals hereto.
 
“Register” shall have the meaning assigned to such term in Section 9.04(b).
 
“Regulation U” shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
 
“Regulation X” shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
 

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“Related Fund” shall mean, with respect to any Lender that is a fund that
invests in bank or commercial loans and similar extensions of credit, any other
fund that invests in bank or commercial loans and similar extensions of credit
and is advised or managed by (a) such Lender, (b) an Affiliate of such Lender or
(c) an entity (or an Affiliate of such entity) that administers, advises or
manages such Lender.
 
“Related Parties” shall mean, with respect to any specified person, such
person’s Affiliates and the respective directors, trustees, officers, employees,
agents and advisors of such person and such person’s Affiliates.
 
“Related Sections” shall have the meaning assigned to such term in Section 6.04.
 
“Release” shall mean any spilling, leaking, seepage, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing,
depositing, emanating or migrating in, into, onto or through the environment.
 
“relevant transactions” shall have the meaning assigned to such term in the
definition of “Pro Forma Basis” in this Section 1.01.
 
“Remaining Present Value” shall mean, as of any date with respect to any lease,
the present value as of such date of the scheduled future lease payments with
respect to such lease, determined with a discount rate equal to a market rate of
interest for such lease reasonably determined at the time such lease was entered
into.
 
“Report” shall have the meaning assigned to such term in Section 8.12(a).
 
“Reportable Event” shall mean any reportable event as defined in Section 4043(c)
of ERISA or the regulations issued thereunder, other than those events as to
which the 30-day notice period referred to in Section 4043(c) of ERISA has been
waived, with respect to a Plan (other than a Plan maintained by an ERISA
Affiliate that is considered an ERISA Affiliate only pursuant to subsection (m)
or (o) of Section 414 of the Code).
 
“Required Lenders” shall mean, at any time, Lenders whose Pro Rata Shares
aggregate more than fifty percent (50%). The Pro Rata Share of any Defaulting
Lender shall be disregarded in determining Required Lenders at any time.
 
“Required Percentage” shall mean, with respect to an Excess Cash Flow Period (or
Excess Cash Flow Interim Period), 50%; provided, that (a) if the Total Net First
Lien Leverage Ratio at the end of the Applicable Period (or Excess Cash Flow
Interim Period) is greater than 1.50 to 1.00 but less than or equal to 2.00 to
1.00, such percentage shall be 25%, and (b) if the Total Net First Lien Leverage
Ratio at the end of the Applicable Period (or Excess Cash Flow Interim Period)
is less than or equal to 1.50 to 1.00, such percentage shall be 0%.
 
“Requirement of Law” means, as to any person, any law (statutory or common),
treaty, rule, or regulation or determination of an arbitrator or of a
Governmental Authority, in each case applicable to or binding upon the person or
any of its property or to which the person or any of its property is subject.
 

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“Reserves” means such reserves against the Borrowing Base that the
Administrative Agent has, in the exercise of its Reasonable Credit Judgment,
established from time to time upon at least seven Business Days’ notice to the
Company.
 
“Responsible Officer” of any person shall mean any executive officer or
Financial Officer of such person and any other officer or similar official
thereof responsible for the administration of the obligations of such person in
respect of this Agreement.
 
“Retained Excess Cash Flow Overfunding” shall mean, at any time, in respect of
any Excess Cash Flow Interim Period as to which the corresponding Excess Cash
Flow Period has ended at such time, a portion of the cumulative Excess Cash Flow
for such Excess Cash Flow Interim Period equal to the amount, if any, by which
the Retained Percentage of Excess Cash Flow for such Excess Cash Flow Interim
Period exceeds the Retained Percentage of Excess Cash Flow for such
corresponding Excess Cash Flow Period.
 
“Retained Percentage” shall mean, with respect to any Excess Cash Flow Period
(or Excess Cash Flow Interim Period), (a) 100% minus (b) the Required Percentage
with respect to such Excess Cash Flow Period (or Excess Cash Flow Interim
Period).
 
“Revaluation Date” means, with respect to any Alternate Currency Letter of
Credit, each of the following: (i) each date of issuance of an Alternate
Currency Letter of Credit, (ii) each date of an amendment of an Alternate
Currency Letter of Credit having the effect of increasing the amount thereof,
(iii) each date of any payment by the Issuing Bank under an Alternate Currency
Letter of Credit, and (iv) such additional dates as the Administrative Agent or
the Issuing Bank shall determine or the Required Lenders shall require.
 
“Revolving Facility” shall mean the Revolving Facility Commitments (including
any Incremental Revolving Facility Commitments) and the extensions of credit
made hereunder by the Revolving Lenders.
 
“Revolving Facility Borrowing” shall mean a Borrowing comprised of Revolving
Loans.
 
“Revolving Facility Commitment” shall mean, with respect to each Revolving
Lender, the commitment of such Revolving Lender to make Revolving Loans pursuant
to Section 2.01, expressed as an amount representing the maximum aggregate
permitted amount of such Revolving Lender’s Revolving Facility Credit Exposure
hereunder, as such commitment may be (a) reduced from time to time pursuant to
Section 2.08, (b) reduced or increased from time to time pursuant to assignments
by or to such Lender under Section 9.04, and (c) increased or provided under
Section 2.21. The initial amount of each Lender’s Revolving Facility Commitment
is set forth on Schedule 2.01, or in the Assignment and Acceptance or
Incremental Assumption Agreement pursuant to which such Lender shall have
assumed its Revolving Facility Commitment (or Incremental Revolving Facility
Commitment), as applicable. The initial aggregate amount of the Lenders’
Revolving Facility Commitments prior to any Incremental Revolving Facility
Commitments) is $400 million.
 
“Revolving Facility Credit Exposure” shall mean, at any time, the sum of (a) the
aggregate principal amount of the Revolving Loans outstanding at such time, (b)
the aggregate
 

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amount of Pending Revolving Loans, (c) the Swingline Exposure and Agent Advance
Exposure at such time and (d) the Revolving L/C - BA Exposure at such time. The
Revolving Facility Credit Exposure of any Revolving Lender at any time shall be
the product of (x) such Revolving Lender’s Pro Rata Share and (y) the aggregate
Revolving Facility Credit Exposure of all Revolving Lenders, collectively, at
such time.
 
“Revolving Facility Maturity Date” shall mean April 3, 2013.
 
“Revolving Lender” shall mean a Lender (including an Incremental Revolving
Lender) with a Revolving Facility Commitment or with outstanding Revolving
Loans.
 
“Revolving Loan” shall mean a Loan made by a Revolving Lender pursuant to
Section 2.01.
 
“Revolving L/C - BA Exposure” shall mean at any time the sum of (a) the
aggregate undrawn amount of all Letters of Credit outstanding at such time
(calculated, in the case of Alternate Currency Letters of Credit, based on the
Dollar Equivalent thereof), (b) the sum of the maximum aggregate amount that is,
or at any time thereafter may become, payable by the Issuing Banks under all
then outstanding Bankers’ Acceptances (calculated, in the case of Alternate
Currency Letters of Credit, based on the Dollar Equivalent thereof) and (c) the
aggregate principal amount of all L/C - BA Disbursements that have not yet been
reimbursed at such time (calculated, in the case of Alternate Currency Letters
of Credit, based on the Dollar Equivalent thereof). The Revolving L/C - BA
Exposure of any Revolving Lender at any time shall mean its Pro Rata Share of
the aggregate Revolving L/C - BA Exposure at such time. For all purposes of this
Agreement, if on any date of determination a Letter of Credit has expired by its
terms but any amount may still be drawn thereunder by reason of the operation of
Rule 3.14 of the International Standby Practices (ISP98), such Letter of Credit
shall be deemed to be “outstanding” in the amount so remaining available to be
drawn. Unless otherwise specified herein, the amount of a Letter of Credit at
any time shall be deemed to be the stated amount of such Letter of Credit in
effect at such time; provided, that with respect to any Letter of Credit that,
by its terms or the terms of any document related thereto, provides for one or
more automatic increases in the stated amount thereof, the amount of such Letter
of Credit shall be deemed to be the maximum stated amount of such Letter of
Credit after giving effect to all such increases, whether or not such maximum
stated amount is in effect at such time.
 
“S&P” shall mean Standard & Poor’s Ratings Group, Inc.
 
“Sale and Lease-Back Transaction” shall have the meaning assigned to such term
in Section 6.03.
 
“SEC” shall mean the Securities and Exchange Commission or any successor
thereto.
 
“Second Lien Fixed Rate Notes” shall mean the 8⅞% Second Priority Senior Secured
Notes due 2014, issued by the Company pursuant to the Second Lien Notes
Indenture and any notes issued in exchange for, and as contemplated by, the
Second Lien Fixed Rate Notes and the related registration rights agreement with
substantially identical terms as the Second Lien Fixed Rate Notes.
 

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“Second Lien Floating Rate Notes” shall mean the floating rate Second Priority
Senior Secured Notes due 2014, issued pursuant to the Second Lien Notes
Indenture and any notes issued by the Borrower in exchange for, and as
contemplated by, the Second Lien Floating Rate Notes and the related
registration rights agreement with substantially identical terms as the Second
Lien Floating Rate Notes.
 
“Second Lien Note Documents” shall mean the Second Lien Notes, the Second Lien
Notes Indenture and the Second Lien Security Documents.
 
“Second Lien Notes” shall mean the Second Lien Fixed Rate Notes and the Second
Lien Floating Rate Notes.
 
“Second Lien Notes Indenture” shall mean the Indenture dated as of September 20,
2006 among Berry and certain of its subsidiaries party thereto and the trustee
named therein from time to time, as in effect on the Closing Date and as
amended, restated, supplemented or otherwise modified from time to time in
accordance with the requirements thereof and of this Agreement.
 
“Second Lien Security Documents” shall mean the “Security Documents” as defined
in the Second Lien Notes Indenture.
 
“Secured Parties” shall mean the “Secured Parties” as defined in the Collateral
Agreement.
 
“Securities Act” shall mean the Securities Act of 1933, as amended.
 
“Security Documents” shall mean the Mortgages, the Collateral Agreement, the
Foreign Pledge Agreements and each of the security agreements and other
instruments and documents executed and delivered pursuant to any of the
foregoing or pursuant to Section 5.10.
 
“Senior Lender Intercreditor Agreement” shall mean the Amended and Restated
Senior Lender Priority and Intercreditor Agreement dated as of the date hereof,
as amended, supplemented or otherwise modified from time to time, among
Holdings, the Borrowers, the Subsidiary Loan Parties, each Subsidiary that
becomes a party thereto after the date hereof, the Collateral Agent, the
Administrative Agent, the “Administrative Agent” under the Term Loan Credit
Agreement and the “Collateral Agent” under the Term Loan Credit Agreement.
 
“Senior Subordinated Note Documents” shall mean the Covalence Senior
Subordinated Note Documents and the Berry Senior Subordinated Note Documents.
 
“Senior Subordinated Notes” shall mean the Covalence Senior Subordinated Notes
and the Berry Senior Subordinated Notes.
 
“Senior Subordinated Notes Indentures” shall mean the Covalence Senior
Subordinated Notes Indenture and the Berry Senior Subordinated Notes Indenture.
 
“Settlement” and “Settlement Date” have the meanings specified in Section
2.04(e).
 

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“Specified Default” shall mean the occurrence of any Event of Default specified
in Sections 7.01(b), (c), (h) or (i).
 
“Spot Rate” for a currency means the rate determined by the Administrative Agent
or the Issuing Bank, as applicable, to be the rate quoted by the person acting
in such capacity as the spot rate for the purchase by such person of such
currency with another currency through its principal foreign exchange trading
office at approximately 11:00 a.m. on the date three Business Days prior to the
date as of which the foreign exchange computation is made or if such rate cannot
be computed as of such date such other rate as the Administrative Agent or the
Issuing Bank shall reasonably determine is appropriate under the circumstances;
provided that the Administrative Agent or the Issuing Bank may obtain such spot
rate from another financial institution designated by the Administrative Agent
or the Issuing Bank if the person acting in such capacity does not have as of
the date of determination a spot buying rate for any such currency; and provided
further that the Issuing Bank may use such spot rate quoted on the date as of
which the foreign exchange computation is made in the case of any Letter of
Credit denominated in an Alternate Currency.
 
“Statutory Reserves” shall mean, with respect to any currency, any reserve,
liquid asset or similar requirements established by any Governmental Authority
of the United States of America or of the jurisdiction of such currency or any
jurisdiction in which Loans in such currency are made to which banks in such
jurisdiction are subject for any category of deposits or liabilities customarily
used to fund loans in such currency or by reference to which interest rates
applicable to Loans in such currency are determined.
 
“Subagent” shall have the meaning assigned to such term in Section 8.02.
 
“Subordinated Intercompany Debt” shall have the meaning assigned to such term in
Section 6.01(e).
 
“subsidiary” shall mean, with respect to any person (herein referred to as the
“parent”), any corporation, partnership, association or other business entity
(a) of which securities or other ownership interests representing more than 50%
of the equity or more than 50% of the ordinary voting power or more than 50% of
the general partnership interests are, at the time any determination is being
made, directly or indirectly, owned, Controlled or held, or (b) that is, at the
time any determination is made, otherwise Controlled, by the parent or one or
more subsidiaries of the parent or by the parent and one or more subsidiaries of
the parent.
 
“Subsidiary” shall mean, unless the context otherwise requires, a subsidiary of
the Company. Notwithstanding the foregoing (and except for purposes of Sections
3.09, 3.13, 3.15, 3.16, 5.03, 5.09 and 7.01(k), and the definition of
Unrestricted Subsidiary contained herein), an Unrestricted Subsidiary shall be
deemed not to be a Subsidiary of the Company or any of its Subsidiaries for
purposes of this Agreement.
 
“Subsidiary Loan Party” shall mean (a) each Domestic Subsidiary of the Company
on the Closing Date and (b) each Domestic Subsidiary of the Company that
becomes, or is required to become, a party to the Collateral Agreement, the
Intercreditor Agreement and the Senior Lender Intercreditor Agreement after the
Closing Date.
 

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“Subsidiary Redesignation” shall have the meaning provided in the definition of
“Unrestricted Subsidiary” contained in this Section 1.01.
 
“Swap Agreement” shall mean any agreement with respect to any swap, forward,
future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities (including,
for the avoidance of doubt, resin), equity or debt instruments or securities, or
economic, financial or pricing indices or measures of economic, financial or
pricing risk or value or any similar transaction or any combination of these
transactions; provided, that no phantom stock or similar plan providing for
payments only on account of services provided by current or former directors,
officers, employees or consultants of Holdings, the Company or any of the
Subsidiaries shall be a Swap Agreement.
 
“Swingline Borrowing” shall mean a Borrowing comprised of Swingline Loans.
 
“Swingline Borrowing Request” shall mean a request by a Borrower substantially
in the form of Exhibit C-2.
 
“Swingline Commitment” shall mean, with respect to the Swingline Lender, the
commitment of the Swingline Lender to make Swingline Loans pursuant to
Section 2.04. The aggregate amount of the Swingline Commitments on the Closing
Date is $25 million.
 
“Swingline Exposure” shall mean at any time the aggregate principal amount of
all outstanding Swingline Borrowings at such time. The Swingline Exposure of any
Revolving Lender at any time shall mean its Pro Rata Share of the aggregate
Swingline Exposure at such time.
 
“Swingline Lender” shall mean Bank of America in its capacity as a lender of
Swingline Loans.
 
“Swingline Loans” shall mean the swingline loans made to the Borrowers pursuant
to Section 2.04.
 
“Syndication Agent” shall have the meaning assigned to such term in the
introductory paragraph of this Agreement.
 
“Taxes” shall mean any and all present or future taxes, levies, imposts, duties
(including stamp duties), deductions, withholdings or similar charges (including
ad valorem charges) imposed by any Governmental Authority and any and all
interest and penalties related thereto.
 
“Term Facility Collateral Agent” shall have the meaning assigned to such term in
the Senior Lender Intercreditor Agreement.
 
“Term Loans” shall mean loans made pursuant to and in accordance with the Term
Loan Credit Agreement.
 
“Term Loan Credit Agreement” shall mean the Second Amended and Restated Term
Loan Credit Agreement, dated as of the date hereof among Holdings, the Company,
the
 

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lenders and agents party thereto and Credit Suisse, as administrative agent and
collateral agent for such lenders, as amended, restated, supplemented, waived,
replaced, restructured, repaid, refunded, refinanced or otherwise modified from
time to time, including any agreement or indenture extending the maturity
thereof, refinancing, replacing or otherwise restructuring all or any portion of
the Indebtedness under such agreement or agreements or indenture or indentures
or increasing the amount loaned thereunder or altering the maturity thereof.
 
“Term Loan Documents” shall mean the “Loan Documents” as defined in the Term
Loan Credit Agreement.
 
“Term Loan Obligations” shall mean the “Obligations” as defined in the Term Loan
Credit Agreement.
 
“Term Loan Secured Parties” shall have the meaning assigned to such term in the
Senior Lender Intercreditor Agreement.
 
“Test Period” shall mean, on any date of determination, the period of four
consecutive fiscal quarters of the Company then most recently ended (taken as
one accounting period).
 
“Threshold Amount” means 10% of the lesser of (i) the Revolving Facility
Commitments and (ii) the Borrowing Base, in each case as of any date of
determination.
 
“Total Net First Lien Leverage Ratio” means, on any date, the ratio of (a) First
Lien Debt as of such date to (b) EBITDA for the period of four consecutive
fiscal quarters of the Company most recently ended as of such date, all
determined on a consolidated basis in accordance with GAAP; provided, that
EBITDA shall be determined for the relevant Test Period on a Pro Forma Basis.
 
“Transaction Documents” shall mean the Loan Documents, the Term Loan Credit
Agreement and the “Loan Documents” as defined therein and the Merger Documents.
 
“Transaction Expenses” means any fees or expenses incurred or paid by the Funds
or Fund Affiliates, Holdings, the Company (or any direct or indirect parent of
the Company) or any of its Subsidiaries in connection with the Transactions,
this Agreement and the other Loan Documents (including expenses in connection
with Swap Agreements) and the transactions contemplated hereby and thereby.
 
“Transactions” shall mean, collectively, the transactions to occur pursuant to
the Transaction Documents, including (a) the consummation of the Business
Combination; (b) the execution and delivery of the Loan Documents, the creation
or continuation of the Liens pursuant to the Security Documents, and the initial
borrowings hereunder; (c) the Refinancing; and (d) the payment of all
Transaction Expenses.
 
“Type” shall mean, when used in respect of any Loan or Borrowing, the Rate by
reference to which interest on such Loan or on the Loans comprising such
Borrowing is
 

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determined. For purposes hereof, the term “Rate” shall include the Adjusted LIBO
Rate and the ABR.
 
“UFCA” shall have the meaning assigned to such term in Section 9.22.
 
“UFTA” shall have the meaning assigned to such term in Section 9.22.
 
“Unfunded Pension Liability” means the excess of a Plan’s benefit liabilities
under Section 4001(a)(16) of ERISA, over the current value of that Plan’s
assets, determined in accordance with the assumptions used for funding the Plan
pursuant to Section 412 of the Code for the applicable plan year.
 
“Uniform Commercial Code” or “UCC” means the Uniform Commercial Code as the same
may from time to time be in effect in the State of New York or the Uniform
Commercial Code (or similar code or statute) of another jurisdiction, to the
extent it may be required to apply to any item or items of Collateral.
 
“Unrestricted Cash” shall mean domestic cash or cash equivalents of the Company
or any of its Subsidiaries that would not appear as “restricted” on a
consolidated balance sheet of the Company or any of its Subsidiaries.
 
“Unrestricted Subsidiary” shall mean (i) any subsidiary of the Company
identified on Schedule 1.01(i) and (ii) any subsidiary of the Company that is
acquired or created after the Closing Date and designated by the Company as an
Unrestricted Subsidiary hereunder by written notice to the Administrative Agent;
provided, that the Company shall only be permitted to so designate a new
Unrestricted Subsidiary after the Closing Date and so long as (a) no Default or
Event of Default has occurred and is continuing or would result therefrom, (b)
such Unrestricted Subsidiary shall be capitalized (to the extent capitalized by
the Company or any of its Subsidiaries) through Investments as permitted by, and
in compliance with, Section 6.04(j), and any prior or concurrent Investments in
such Subsidiary by the Company or any of its Subsidiaries shall be deemed to
have been made under Section 6.04(j), (c) without duplication of clause (b), any
assets owned by such Unrestricted Subsidiary at the time of the initial
designation thereof shall be treated as Investments pursuant to Section 6.04(j),
and (d) such Subsidiary shall have been designated an “unrestricted subsidiary”
(or otherwise not be subject to the covenants and defaults) under the Second
Lien Notes Indenture, the Senior Subordinated Notes Indentures, any other
Indebtedness permitted to be incurred hereby and all Permitted Refinancing
Indebtedness in respect of any of the foregoing and all Disqualified Stock;
provided, further, that at the time of the initial Investment by the Company or
any of its Subsidiaries in such Subsidiary, the Company shall designate such
entity as an Unrestricted Subsidiary in a written notice to the Administrative
Agent. The Company may designate any Unrestricted Subsidiary to be a Subsidiary
for purposes of this Agreement (each, a “Subsidiary Redesignation”); provided,
that (i) such Unrestricted Subsidiary, both before and after giving effect to
such designation, shall be a Wholly Owned Subsidiary of the Company, (ii) no
Default or Event of Default has occurred and is continuing or would result
therefrom, (iii) all representations and warranties contained herein and in the
other Loan Documents shall be true and correct in all material respects with the
same effect as though such representations and warranties had been made on and
as of the date of such Subsidiary Redesignation (both before and after giving
effect thereto), unless stated to
 

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relate to a specific earlier date, in which case such representations and
warranties shall be true and correct in all material respects as of such earlier
date, and (iv) the Company shall have delivered to the Administrative Agent an
officer’s certificate executed by a Responsible Officer of the Company,
certifying to the best of such officer’s knowledge, compliance with the
requirements of preceding clauses (i) through (iii), inclusive.
 
“Wholly Owned Subsidiary” of any person shall mean a subsidiary of such person,
all of the Equity Interests of which (other than directors’ qualifying shares or
nominee or other similar shares required pursuant to applicable law) are owned
by such person or another Wholly Owned Subsidiary of such person.
 
“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer Plan, as such terms
are defined in Part I of Subtitle E of Title IV of ERISA.
 
“Working Capital” shall mean, with respect to the Company and the Subsidiaries
on a consolidated basis at any date of determination, Current Assets at such
date of determination minus Current Liabilities at such date of
determination; provided, that, for purposes of calculating Excess Cash Flow,
increases or decreases in Working Capital shall be calculated without regard to
any changes in Current Assets or Current Liabilities as a result of (a) any
reclassification in accordance with GAAP of assets or liabilities, as
applicable, between current and noncurrent or (b) the effects of purchase
accounting.
 
SECTION 1.02. Terms Generally. The definitions set forth or referred to in
Section 1.01 shall apply equally to both the singular and plural forms of the
terms defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words “include,”
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation.” All references herein to Articles, Sections, Exhibits and Schedules
shall be deemed references to Articles and Sections of, and Exhibits and
Schedules to, this Agreement unless the context shall otherwise require. Except
as otherwise expressly provided herein, any reference in this Agreement to any
Loan Document shall mean such document as amended, restated, supplemented or
otherwise modified from time to time. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided, that, if the
Company notifies the Administrative Agent that the Company requests an amendment
to any provision hereof to eliminate the effect of any change occurring after
the Closing Date in GAAP or in the application thereof on the operation of such
provision (or if the Administrative Agent notifies the Company that the Required
Lenders request an amendment to any provision hereof for such purpose),
regardless of whether any such notice is given before or after such change in
GAAP or in the application thereof, then such provision shall be interpreted on
the basis of GAAP as in effect and applied immediately before such change shall
have become effective until such notice shall have been withdrawn or such
provision amended in accordance herewith.
 
SECTION 1.03. Effectuation of Transactions. Each of the representations and
warranties of Holdings and the Borrowers contained in this Agreement (and all
corresponding definitions) are made after giving effect to the Transactions,
unless the context otherwise requires.
 

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SECTION 1.04. Exchange Rates; Currency Equivalents. i) The Administrative Agent
shall determine the Spot Rate as of each Revaluation Date to be used for
calculating Dollar Equivalent amounts of Alternate Currency Letters of Credit.
Such Spot Rate shall become effective as of such Revaluation Date and shall be
the Spot Rate employed in converting any amounts between the Dollars and each
Alternate Currency until the next Revaluation Date to occur. Except for purposes
of financial statements delivered by Loan Parties hereunder or calculating
financial covenants hereunder or except as otherwise provided herein, the
applicable amount of any currency (other than Dollars) for purposes of the Loan
Documents shall be such Dollar Equivalent amount as so determined by the
Administrative Agent. No Default or Event of Default shall arise as a result of
any limitation or threshold set forth in U.S. Dollars in Article VI or paragraph
(f) or (j) of Section 7.01 being exceeded solely as a result of changes in
currency exchange rates from those rates applicable on the first day of the
fiscal quarter in which such determination occurs or in respect of which such
determination is being made.
 
(b) Wherever in this Agreement in connection with an Alternate Currency Letter
of Credit, an amount, such as a required minimum or multiple amount, is
expressed in Dollars, such amount shall be the Dollar Equivalent of such Dollar
amount (rounded to the nearest unit of such Alternate Currency, with 0.5 of a
unit being rounded upward), as determined by the Administrative Agent.
 
 
 
 
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SECTION 1.05. Senior Debt. The Obligations constitute (a) “First-Lien
Indebtedness” pursuant to, and as defined in, the Intercreditor Agreement, (b)
“Senior Debt” and “Designated Senior Debt” pursuant to, and as defined in, the
Senior Subordinated Notes Indentures, and (c) “First-Priority Lien Obligations”
pursuant to, and as defined in, the Second Lien Notes Indenture. This Agreement
is a “Credit Agreement” for purposes of the Subordinated Indentures and the
Second Lien Notes Indenture.
ARTICLE II
 
 

 
 
The Credits
 
SECTION 2.01. Commitments. Subject to the terms and conditions set forth herein,
each Lender agrees to make Revolving Loans to the Borrowers from time to time
during the Availability Period in an aggregate principal amount that will not
result in (i) such Lender’s Revolving Facility Credit Exposure (except for the
Administrative Agent with respect to Agent Advances) exceeding such Lender’s
Revolving Facility Commitment (or, if less, prior to delivery to the
Administrative Agent of the Post-Closing Reports, such Lender’s Pro Rata Share
of $340 million), or (ii) the Revolving Facility Credit Exposure exceeding the
total Revolving Facility Commitments or, until delivery of the Post-Closing
Reports to the Administrative Agent, $340 million, or (iii) such Lender’s
Revolving Facility Credit Exposure exceeding such Lender’s Pro Rata Share of the
Borrowing Base. The Lenders, however, in their unanimous discretion, may elect
to make Revolving Loans or issue or arrange to have issued Letters of Credit in
excess of the Availability on one or more occasions, but if they do so, neither
the Administrative Agent nor the Lenders shall be deemed thereby to have changed
the limits of the Borrowing Base or to be obligated to exceed such limits on any
other occasion. If the Revolving Facility Credit Exposure
 

 

exceeds the Borrowing Base, the Lenders may refuse to make or otherwise restrict
the making of Revolving Loans and the issuance of Letters of Credit as the
Lenders determine until such excess has been eliminated, subject to the
Administrative Agent’s authority, in its sole discretion, to make Agent Advances
pursuant to the terms of Section 2.04(d). Within the foregoing limits and
subject to the terms and conditions set forth herein, the Borrowers may borrow,
prepay and reborrow Revolving Loans.
 
SECTION 2.02. Loans and Borrowings. ii) Each Revolving Loan shall be made as
part of a Borrowing consisting of Loans under the Revolving Facility and of the
same Type made by the Lenders ratably in accordance with their respective
Commitments under the Revolving Facility (or, in the case of Swingline Loans, in
accordance with their respective Swingline Commitments); provided, however, that
Revolving Loans shall be made by the Revolving Lenders ratably in accordance
with their respective Pro Rata Shares on the date such Loans are made hereunder.
The failure of any Lender to make any Loan required to be made by it shall not
relieve any other Lender of its obligations hereunder; provided, that the
Commitments of the Lenders are several and no Lender shall be responsible for
any other Lender’s failure to make Loans as required.
 
(b) Subject to Section 2.14, each Borrowing (other than a Swingline Borrowing
and excluding Agent Advances) shall be comprised entirely of ABR Loans or
Eurocurrency Loans as the Borrowers may request in accordance herewith. Each
Swingline Borrowing shall be an ABR Borrowing. Each Lender at its option may
make any ABR Loan or Eurocurrency Loan by causing any domestic or foreign branch
or Affiliate of such Lender to make such Loan; provided, that any exercise of
such option shall not affect the obligation of the Borrowers to repay such Loan
in accordance with the terms of this Agreement and such Lender shall not be
entitled to any amounts payable under Section 2.15 or 2.17 solely in respect of
increased costs resulting from such exercise and existing at the time of such
exercise.
 
(c) At the commencement of each Interest Period for any Eurocurrency Revolving
Facility Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of the Borrowing Multiple and not less than the Borrowing
Minimum. At the time that each ABR Revolving Facility Borrowing is made, such
Borrowing shall be in an aggregate amount that is an integral multiple of the
Borrowing Multiple and not less than the Borrowing Minimum; provided, that an
ABR Revolving Facility Borrowing may be in an aggregate amount that is equal to
the entire unused balance of the Revolving Facility Commitments or that is
required to finance the reimbursement of an L/C - BA Disbursement as
contemplated by Section 2.05(e). Each Swingline Borrowing shall be in an amount
that is an integral multiple of the Borrowing Multiple and not less than the
Borrowing Minimum. Borrowings of more than one Type and under more than one
Facility may be outstanding at the same time; provided, that there shall not at
any time be more than a total of 10 Eurocurrency Borrowings outstanding under
the Revolving Facility.
 
(d) Notwithstanding any other provision of this Agreement, no Borrower shall be
entitled to request, or to elect to convert or continue, any Borrowing if the
Interest Period requested with respect thereto would end after the Revolving
Facility Maturity Date.
 

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SECTION 2.03. Requests for Borrowings. To request a Revolving Facility
Borrowing, a Borrower shall notify the Administrative Agent of such request by
telephone (a) in the case of a Eurocurrency Borrowing, not later than 12:00
p.m., Local Time, three Business Days before the date of the proposed Borrowing
or (b) in the case of an ABR Borrowing, not later than 12:00 noon, Local Time,
one Business Day before the date of the proposed Borrowing; provided, that any
such notice of an ABR Revolving Facility Borrowing to finance the reimbursement
of an L/C - BA Disbursement as contemplated by Section 2.05(e) may be given not
later than 10:00 a.m., Local Time, on the date of the proposed Borrowing. Each
such telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Borrowing Request in a form approved by the Administrative Agent and signed by
such Borrower. Each such telephonic and written Borrowing Request shall specify
the following information in compliance with Section 2.02:
 
(i) the aggregate amount of the requested Borrowing;
 
(ii) the date of such Borrowing, which shall be a Business Day;
 
(iii) whether such Borrowing is to be an ABR Borrowing or a Eurocurrency
Borrowing;
 
(iv) in the case of a Eurocurrency Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period”; and
 
(v) the location and number of the Borrower’s account to which funds are to be
disbursed.
 
If no election as to the Type of Revolving Facility Borrowing is specified, then
the requested Revolving Facility Borrowing shall be an ABR Borrowing. If no
Interest Period is specified with respect to any requested Eurocurrency
Borrowing, then the applicable Borrower shall be deemed to have selected an
Interest Period of one month’s duration. Promptly following receipt of a
Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Lender of the details thereof and of the amount of such
Lender’s Loan to be made as part of the requested Borrowing.
 
SECTION 2.04. Swingline Loans and Agent Advances. iii) Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make Swingline Loans
to the Borrowers from time to time during the Availability Period, in an
aggregate principal amount at any time outstanding that will not result in (i)
the aggregate principal amount of outstanding Swingline Loans exceeding the
Swingline Commitment or (ii) the Revolving Facility Credit Exposure exceeding
the Borrowing Base; provided, that the Swingline Lender shall not be required to
make a Swingline Loan to refinance an outstanding Swingline Borrowing. Within
the foregoing limits and subject to the terms and conditions set forth herein,
the Borrowers may borrow, prepay and reborrow Swingline Loans.
 
(b) To request a Swingline Borrowing, the Borrowers shall notify the
Administrative Agent and the Swingline Lender of such request by telephone
(confirmed by a
 

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Swingline Borrowing Request by telecopy), not later than 1:00 p.m., Local Time,
on the day of a proposed Swingline Borrowing. Each such notice and Swingline
Borrowing Request shall be irrevocable and shall specify (i) the requested date
(which shall be a Business Day) and (ii) the amount of the requested Swingline
Borrowing. The Swingline Lender shall consult with the Administrative Agent as
to whether the making of the Swingline Loan is in accordance with the terms of
this Agreement prior to the Swingline Lender funding such Swingline Loan. The
Swingline Lender shall make each Swingline Loan in accordance with
Section 2.02(a) on the proposed date thereof by wire transfer of immediately
available funds by 3:00 p.m., Local Time, to the account of such Borrower (or,
in the case of a Swingline Borrowing made to finance the reimbursement of an L/C
- BA Disbursement as provided in Section 2.05(e), by remittance to the
applicable Issuing Bank).
 
(c) The Swingline Lender may by written notice given to the Administrative Agent
not later than 10:00 a.m., Local Time, on any Business Day require the Revolving
Lenders to acquire participations on such Business Day in all or a portion of
the outstanding Swingline Loans made by it. Such notice shall specify the
aggregate amount of such Swingline Loans in which the Revolving Lenders will
participate. Promptly upon receipt of such notice, the Administrative Agent will
give notice thereof to each such Lender, specifying in such notice such Lender’s
Revolving Lender’s Pro Rata Share of such Swingline Loan or Loans. Each
Revolving Lender hereby absolutely and unconditionally agrees, upon receipt of
notice as provided above, to pay to the Administrative Agent for the account of
the Swingline Lender, such Revolving Lender’s Pro Rata Share of such Swingline
Loan or Loans. Each Revolving Lender acknowledges and agrees that its respective
obligation to acquire participations in Swingline Loans pursuant to this
paragraph is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or reduction or termination of the Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction whatsoever. Each
Revolving Lender shall comply with its obligation under this paragraph by wire
transfer of immediately available funds, in the same manner as provided in
Section 2.06 with respect to Loans made by such Revolving Lender (and
Section 2.06 shall apply, mutatis mutandis, to the payment obligations of the
Lenders), and the Administrative Agent shall promptly pay to the Swingline
Lender the amounts so received by it from the Revolving Lenders. The
Administrative Agent shall notify the Borrowers of any participations in any
Swingline Loan acquired pursuant to this paragraph (c), and thereafter payments
in respect of such Swingline Loan shall be made to the Administrative Agent and
not to the Swingline Lender. Any amounts received by the Swingline Lender from
the Borrowers (or other party on behalf of such Borrowers) in respect of a
Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale
of participations therein shall be promptly remitted to the Administrative
Agent; any such amounts received by the Administrative Agent shall be promptly
remitted by the Administrative Agent to the Revolving Lenders that shall have
made their payments pursuant to this paragraph and to the Swingline Lender, as
their interests may appear; provided, that any such payment so remitted shall be
repaid to the Swingline Lender or to the Administrative Agent, as applicable, if
and to the extent such payment is required to be refunded to the applicable
Borrower for any reason. The purchase of participations in a Swingline Loan
pursuant to this paragraph shall not relieve the Borrowers of any default in the
payment thereof.
 

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(d) Subject to the limitations set forth in the provisos contained in this
Section 2.04(d), the Administrative Agent is hereby authorized by the Borrowers
and the Lenders, from time to time in the Administrative Agent’s sole
discretion, (i) after the occurrence of a Default or an Event of Default, or
(ii) at any time that any of the other applicable conditions precedent set forth
in Article IV have not been satisfied, to make advances to or for the account of
any Borrower on behalf of the Lenders which the Administrative Agent, in its
reasonable business judgment, deems necessary or desirable (A) to preserve or
protect the Collateral, or any portion thereof, (B) to enhance the likelihood
of, or maximize the amount of, repayment of the Revolving Loans and other
Obligations, or (C) to pay any other amount chargeable to the Borrowers pursuant
to the terms of this Agreement, including costs, fees, and expenses as described
in Section 9.05(a) (any of the advances described in this Section 2.04(d) being
hereinafter referred to as “Agent Advances”); provided that (1) the Revolving
Facility Credit Exposure after giving effect to any Agent Advance shall not
exceed the Revolving Facility Commitments and (2) Agent Advances outstanding and
unpaid at no time will exceed $30 million in the aggregate, and provided further
that the Required Lenders may at any time revoke the Administrative Agent’s
authorization contained in this Section 2.04(d) to make Agent Advances, any such
revocation to be in writing and to become effective prospectively upon the
Administrative Agent’s receipt thereof. The Agent Advances shall be repayable on
demand and secured by the Collateral Agent’s Liens in and to the Collateral,
shall constitute Obligations hereunder, and shall bear interest at the rate
applicable to Revolving Loans from time to time. The Administrative Agent shall
notify each Lender in writing of each Agent Advance; provided that any delay or
failure of the Administrative Agent in providing any such notice to any Lender
shall not result in any liability or constitute the breach of any duty or
obligation of the Administrative Agent hereunder.
 
(e) The Administrative Agent, the Swingline Lender and the Lenders agree (which
agreement shall not be for the benefit of or enforceable by the Borrowers) that
in order to facilitate the administration of this Agreement and the other Loan
Documents, settlement among them as to the Revolving Loans and the Swingline
Loans and the Agent Advances shall take place on a periodic basis in accordance
with the following provisions:
 
(i) The Administrative Agent shall request settlement (a “Settlement”) with the
Lenders on at least a weekly basis, or on a more frequent basis if so determined
by the Administrative Agent, (A) on behalf of the Swingline Lender, with respect
to each outstanding Swingline Loan, (B) for itself, with respect to each Agent
Advance, and (C) with respect to collections received, in each case, by
notifying the Lenders of such requested Settlement by telecopy, telephone, or
other similar form of transmission, of such requested Settlement, no later than
12:00 noon, Local Time, on the date of such requested Settlement (the
“Settlement Date”). Each Lender (other than the Swingline Lender, in the case of
Swingline Loans, and the Administrative Agent, in the case of Agent Advances)
shall make the amount of such Lender’s Pro Rata Share of the outstanding
principal amount of the Swingline Loans and Agent Advances with respect to which
Settlement is requested available to the Administrative Agent, to such account
of the Administrative Agent as the Administrative Agent may designate, not later
than 3:00 p.m., Local Time, on the Settlement Date applicable thereto, which may
occur before or after the occurrence or during the continuation of a Default or
an Event of Default and whether or not the applicable conditions precedent set
forth in Article IV have then been
 

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satisfied. Such amounts made available to the Administrative Agent shall be
applied against the amounts of the applicable Swingline Loan or Agent Advance
and, together with the portion of such Swingline Loan or Agent Advance
representing the Swingline Lender’s or Administrative Agent’s Pro Rata Share
thereof, shall constitute Revolving Loans of the Revolving Lenders. If any such
amount is not made available to the Administrative Agent by any Revolving Lender
on the Settlement Date applicable thereto, the Administrative Agent shall, on
behalf of the Swingline Lender with respect to each outstanding Swingline Loan
and for itself with respect to each Agent Advance, be entitled to recover such
amount on demand from such Revolving Lender together with interest thereon at
the Federal Funds Effective Rate for the first three days from and after the
Settlement Date and thereafter at the interest rate then applicable to ABR
Revolving Loans.
 
(ii) Notwithstanding the foregoing, not more than one Business Day after demand
is made by the Administrative Agent (whether before or after the occurrence of a
Default or an Event of Default and regardless of whether the Administrative
Agent has requested a Settlement with respect to a Swingline Loan or Agent
Advance), each Revolving Lender (A) shall irrevocably and unconditionally
purchase and receive from the Swingline Lender or the Administrative Agent, as
the case may be, without recourse or warranty, an undivided interest and
participation in such Swingline Loan or Agent Advance equal to such Revolving
Lender’s Pro Rata Share of such Swingline Loan or Agent Advance and (B) if
Settlement has not previously occurred with respect to such Swingline Loans or
Agent Advances, upon demand by the Swingline Lender or the Administrative Agent,
as the case may be, shall pay to the Swingline Lender or Administrative Agent,
as applicable, as the purchase price of such participation an amount equal to
one-hundred percent (100%) of such Revolving Lender’s Pro Rata Share of such
Swingline Loans or Agent Advances. If such amount is not in fact made available
to the Administrative Agent by any Lender, the Administrative Agent shall be
entitled to recover such amount on demand from such Lender together with
interest thereon at the Federal Funds Effective Rate for the first three days
from and after such demand and thereafter at the Interest Rate then applicable
to ABR Revolving Loans.
 
(iii) From and after the date, if any, on which any Lender purchases an
undivided interest and participation in any Swingline Loan or Agent Advance
pursuant to clause (ii) preceding, the Administrative Agent shall promptly
distribute to such Revolving Lender such Revolving Lender’s Pro Rata Share of
all payments of principal and interest and all proceeds of Collateral received
by the Administrative Agent in respect of such Swingline Loan or Agent Advance.
 
(iv) Between Settlement Dates, to the extent no Agent Advances are outstanding,
the Administrative Agent may pay over to the Swingline Lender any payments
received by the Administrative Agent, which in accordance with the terms of this
Agreement would be applied to the reduction of the Revolving Loans, for
application to the Swingline Lender’s Revolving Loans or Swingline Loans. If, as
of any Settlement Date, collections received since the then immediately
preceding Settlement Date have been applied to the Swingline Lender’s Revolving
Loans, the Swingline Lender shall pay to the Administrative Agent for the
accounts of the Lenders, to be applied to the
 

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outstanding Revolving Loans of such Lenders, an amount such that each Lender
shall, upon receipt of such amount, have, as of such Settlement Date, its Pro
Rata Share of the Revolving Loans. During the period between Settlement Dates,
the Swingline Lender with respect to Swingline Loans, the Administrative Agent
with respect to Agent Advances, and each Revolving Lender with respect to the
Revolving Loans, shall be entitled to interest at the applicable rate or rates
payable under this Agreement on the actual average daily amount of funds
employed by the Swingline Lender, the Administrative Agent and the Revolving
Lenders.
 
SECTION 2.05. Letters of Credit. iv) General. Subject to the terms and
conditions set forth herein, any Borrower may request the issuance of Letters of
Credit for its own account in a form reasonably acceptable to the applicable
Issuing Bank, at any time and from time to time during the Availability Period
and prior to the date that is five Business Days prior to the Revolving Facility
Maturity Date. In the event of any inconsistency between the terms and
conditions of this Agreement and the terms and conditions of any form of letter
of credit application or other agreement (including any Acceptance Documents)
submitted by a Borrower to, or entered into by a Borrower with, an Issuing Bank
relating to any Letter of Credit, the terms and conditions of this Agreement
shall control. Each Existing Letter of Credit and Existing Bankers’ Acceptance
shall be deemed to be a Letter of Credit or Bankers’ Acceptance, as applicable,
under this Facility and each Lender that is an issuer of an Existing Letter of
Credit or Existing Bankers’ Acceptance shall be deemed to be an Issuing Bank
with respect to such Existing Letter of Credit or Existing Bankers’ Acceptance,
as applicable, and shall have all rights of an Issuing Bank hereunder (but shall
have no obligation extend or renew any Existing Letter of Credit or Existing
Bankers’ Acceptance or to issue additional Letters of Credit or Bankers’
Acceptances) until such Existing Letter of Credit or Existing Bankers’
Acceptance, as applicable, has been terminated.
 
(b) Notice of Issuance, Amendment, Renewal, Extension: Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal (other
than an automatic extension in accordance with paragraph (c) of this Section) or
extension of an outstanding Letter of Credit), a Borrower shall hand deliver or
telecopy (or transmit by electronic communication, if arrangements for doing so
have been approved by the applicable Issuing Bank) to the applicable Issuing
Bank and the Administrative Agent (three Business Days in advance of the
requested date of issuance, amendment or extension or such shorter period as the
Administrative Agent and the Issuing Bank in their sole discretion may agree) a
notice requesting the issuance of a Letter of Credit, or identifying the Letter
of Credit to be amended or extended, and specifying the date of issuance,
amendment or extension (which shall be a Business Day), the date on which such
Letter of Credit and, in the case of an Acceptance Credit, all Bankers’
Acceptances created thereunder are to expire (which shall comply with
paragraph (c) of this Section), the amount and currency (which may be Dollars or
an Alternate Currency) of such Letter of Credit, the name and address of the
beneficiary thereof and such other information as shall be necessary to issue,
amend or extend such Letter of Credit (including whether such Letter of Credit
is an Acceptance Credit). If requested by the applicable Issuing Bank, such
Borrower also shall submit a letter of credit application on such Issuing Bank’s
standard form in connection with any request for a Letter of Credit. A Letter of
Credit shall be issued, amended or extended only if (and upon issuance,
amendment or extension of each Letter of Credit such Borrower shall be deemed to
represent and warrant that), after giving effect to
 

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such issuance, amendment or extension (i) the Revolving L/C - BA Exposure shall
not exceed the Letter of Credit Sublimit, (ii) the Revolving Facility Credit
Exposure shall not exceed the Borrowing Base and (iii) in the case of any
Acceptance Credit, the creation of any related Bankers’ Acceptances would not
cause the applicable Issuing Bank to exceed the maximum amount of outstanding
bankers’ acceptances permitted by applicable law.
 
(c) Expiration Date. Each Letter of Credit shall expire (and in the case of an
Acceptance Credit, shall provide that all Bankers’ Acceptances created
thereunder (which shall in no event have a maturity of less than 30 or more than
120 days after creation thereof) shall expire) at or prior to the close of
business on the earlier of (i) the date one year (unless otherwise agreed upon
by the Administrative Agent and the Issuing Bank in their sole discretion) after
the date of the issuance of such Letter of Credit (or, in the case of any
extension thereof, one year (unless otherwise agreed upon by the Administrative
Agent and the Issuing Bank in their sole discretion) after such renewal or
extension) and (ii) the date that is three Business Days prior to the Revolving
Facility Maturity Date; provided, that any Letter of Credit with one year tenor
may provide for automatic extension thereof for additional one year periods
(which, in no event, shall extend beyond the date referred to in clause (ii) of
this paragraph (c)) so long as such Letter of Credit permits the Issuing Bank to
prevent any such extension at least once in each twelve-month period (commencing
with the date of issuance of such Letter of Credit) by giving prior notice to
the beneficiary thereof not later than five days in each such twelve-month
period to be agreed upon at the time such Letter of Credit is issued; provided,
further, that if the Issuing Bank and the Administrative Agent each consent in
their sole discretion, the expiration date on any Letter of Credit (or, in the
case of an Acceptance Credit, any Bankers’ Acceptances thereunder) may extend
beyond the date referred to in clause (ii) above, provided that, if any such
Letter of Credit is outstanding or is issued after the date that is 30 days
prior to the Revolving Facility Maturity Date the Borrowers shall provide cash
collateral pursuant to documentation reasonably satisfactory to the
Administrative Agent and the relevant Issuing Bank in an amount equal to 105% of
the face amount of each such Letter of Credit on or prior to the date that is 30
days prior to the Revolving Facility Maturity Date or, if later, such date of
issuance.
 
(d) Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) or the creation of a Bankers’
Acceptance in respect of an Acceptance Credit, and without any further action on
the part of the applicable Issuing Bank or the Revolving Lenders, such Issuing
Bank hereby grants to each Revolving Lender, and each Revolving Lender hereby
acquires from such Issuing Bank, a participation in such Letter of Credit or
Bankers’ Acceptance equal to such Revolving Lender’s Pro Rata Share of the
aggregate amount available to be drawn under such Letter of Credit or the
aggregate amount of such Bankers’ Acceptance (calculated, in the case of
Alternate Currency Letters of Credit, based on the Dollar Equivalent thereof).
In consideration and in furtherance of the foregoing, each Revolving Lender
hereby absolutely and unconditionally agrees to pay to the Administrative Agent,
for the account of the applicable Issuing Bank, in Dollars, such Revolving
Lender’s Pro Rata Share of each L/C - BA Disbursement made by such Issuing Bank
and not reimbursed by the Borrowers on the date due as provided in paragraph (e)
of this Section, or of any reimbursement payment required to be refunded to the
Borrowers for any reason (calculated, in the case of any Alternate Currency
Letter of Credit, based on the Dollar Equivalent thereof). Each Revolving Lender
acknowledges and agrees that its obligation to acquire participations pursuant
to this paragraph in respect of Letters of Credit is absolute and unconditional
and shall
 

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not be affected by any circumstance whatsoever, including any amendment, renewal
or extension of any Letter of Credit or the occurrence and continuance of a
Default or reduction or termination of the Commitments, and that each such
payment shall be made without any offset, abatement, withholding or reduction
whatsoever.
 
(e) Reimbursement. If the applicable Issuing Bank shall make any L/C - BA
Disbursement in respect of a Letter of Credit or Bankers’ Acceptance, the
Borrowers shall reimburse such L/C - BA Disbursement by paying to the
Administrative Agent an amount in Dollars equal to such L/C - BA Disbursement
(or, in the case of an Alternate Currency Letter of Credit, the Dollar
Equivalent thereof) not later than 2:00 p.m., Local Time, on the third Business
Day after the Borrowers receives notice under paragraph (g) of this Section of
such L/C - BA Disbursement, together with accrued interest thereon from the date
of such L/C - BA Disbursement at the rate applicable to ABR Loans; provided,
that the Borrowers may, subject to the conditions to borrowing set forth herein,
request in accordance with Section 2.03 or 2.04 that such payment be financed
with an ABR Revolving Facility Borrowing or a Swingline Borrowing, as
applicable, in an equivalent amount and, to the extent so financed, the
Borrowers’ obligation to make such payment shall be discharged and replaced by
the resulting ABR Revolving Facility Borrowing or Swingline Borrowing. If the
Borrowers fail to reimburse any L/C - BA Disbursement when due, then the
Administrative Agent shall promptly notify the applicable Issuing Bank and each
other Revolving Lender of the applicable L/C - BA Disbursement, the payment then
due from the Borrowers in respect thereof and, in the case of a Revolving
Lender, such Lender’s Pro Rata Share thereof. Promptly following receipt of such
notice, each Revolving Lender shall pay to the Administrative Agent in Dollars
its Pro Rata Share of the payment then due from the Borrowers in the same manner
as provided in Section 2.06 with respect to Loans made by such Lender (and
Section 2.06 shall apply, mutatis mutandis, to the payment obligations of the
Revolving Lenders), and the Administrative Agent shall promptly pay to the
applicable Issuing Bank the amounts so received by it from the Revolving
Lenders. Promptly following receipt by the Administrative Agent of any payment
from the Borrowers pursuant to this paragraph, the Administrative Agent shall
distribute such payment to the applicable Issuing Bank or, to the extent that
Revolving Lenders have made payments pursuant to this paragraph to reimburse
such Issuing Bank, then to such Lenders and such Issuing Bank as their interests
may appear. Any payment made by a Revolving Lender pursuant to this paragraph to
reimburse an Issuing Bank for any L/C - BA Disbursement (other than the funding
of an ABR Revolving Loan or a Swingline Borrowing as contemplated above) shall
not constitute a Loan and shall not relieve the Borrowers of their obligation to
reimburse such L/C - BA Disbursement.
 
(f) Obligations Absolute. The obligation of the Borrowers to reimburse L/C - BA
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit, any Bankers’ Acceptance or this Agreement, or any term or provision
therein, (ii) any draft or other document presented under a Letter of Credit or
Bankers’ Acceptance proving to be forged, fraudulent or invalid in any respect
or any statement therein being untrue or inaccurate in any respect, (iii)
payment by the applicable Issuing Bank under a Letter of Credit or Bankers’
Acceptance against presentation of a draft or other document that does not
comply with the terms of such Letter of Credit or Bankers’ Acceptance
 

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or (iv) any other event or circumstance whatsoever, whether or not similar to
any of the foregoing, that might, but for the provisions of this Section,
constitute a legal or equitable discharge of, or provide a right of setoff
against, the Borrowers’ obligations hereunder. Neither the Administrative Agent,
the Lenders nor any Issuing Bank, nor any of their Related Parties, shall have
any liability or responsibility by reason of or in connection with the issuance
or transfer of any Letter of Credit or Bankers’ Acceptance or any payment or
failure to make any payment thereunder (irrespective of any of the circumstances
referred to in the preceding sentence), or any error, omission, interruption,
loss or delay in transmission or delivery of any draft, notice or other
communication under or relating to any Letter of Credit or Bankers’ Acceptance
(including any document required to make a drawing thereunder), any error in
interpretation of technical terms or any consequence arising from causes beyond
the control of such Issuing Bank, or any of the circumstances referred to in
clauses (i), (ii) or (iii) of the first sentence; provided, that the foregoing
shall not be construed to excuse the applicable Issuing Bank from liability to
the Borrowers to the extent of any direct damages (as opposed to consequential
damages, claims in respect of which are hereby waived by the Borrowers to the
extent permitted by applicable law) suffered by the Borrowers that are
determined by a court of competent jurisdiction to have been caused by such
Issuing Bank’s failure to exercise care when determining whether drafts and
other documents presented under a Letter of Credit or Bankers’ Acceptance comply
with the terms thereof. The parties hereto expressly agree that, in the absence
of gross negligence or willful misconduct on the part of the applicable Issuing
Bank, such Issuing Bank shall be deemed to have exercised care in each such
determination. In furtherance of the foregoing and without limiting the
generality thereof, the parties agree that, with respect to documents presented
which appear on their face to be in substantial compliance with the terms of a
Letter of Credit or Bankers’ Acceptance, the applicable Issuing Bank may, in its
sole discretion, either accept and make payment upon such documents without
responsibility for further investigation, regardless of any notice or
information to the contrary.
 
(g) Disbursement Procedures. The applicable Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment or creation of a Bankers’ Acceptance under a Letter of Credit
or any presentation for payment of a Bankers’ Acceptance. Such Issuing Bank
shall promptly notify the Administrative Agent and the applicable Borrower by
telephone (confirmed by telecopy) of any such demand for payment or Bankers’
Acceptance and whether such Issuing Bank has made or will make a L/C - BA
Disbursement thereunder; provided, that any failure to give or delay in giving
such notice shall not relieve the Borrowers of their obligation to reimburse
such Issuing Bank and the Revolving Lenders with respect to any such L/C - BA
Disbursement.
 
(h) Interim Interest. If an Issuing Bank shall make any L/C - BA Disbursement,
then, unless the Borrowers shall reimburse such L/C - BA Disbursement in full on
the date such L/C - BA Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such L/C - BA
Disbursement is made to but excluding the date that the Borrowers reimburse such
L/C - BA Disbursement, at the rate per annum then applicable to ABR Revolving
Loans; provided, that, if such L/C - BA Disbursement is not reimbursed by the
Borrowers when due pursuant to paragraph (e) of this Section, then
Section 2.13(c) shall apply. Interest accrued pursuant to this paragraph shall
be for the account of the applicable Issuing Bank, except that interest accrued
on and after the date of payment by
 

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any Revolving Lender pursuant to paragraph (e) of this Section to reimburse such
Issuing Bank shall be for the account of such Revolving Lender to the extent of
such payment.
 
(i) Replacement of an Issuing Bank. An Issuing Bank may be replaced at any time
by written agreement among the Company, the Administrative Agent, the replaced
Issuing Bank and the successor Issuing Bank. The Administrative Agent shall
notify the Lenders of any such replacement of an Issuing Bank. At the time any
such replacement shall become effective, the Borrowers shall pay all unpaid fees
accrued for the account of the replaced Issuing Bank pursuant to Section 2.12.
From and after the effective date of any such replacement, (i) the successor
Issuing Bank shall have all the rights and obligations of the replaced Issuing
Bank under this Agreement with respect to Letters of Credit to be issued
thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed
to refer to such successor or to any previous Issuing Bank, or to such successor
and all previous Issuing Banks, as the context shall require. After the
replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain
a party hereto and shall continue to have all the rights and obligations of such
Issuing Bank under this Agreement with respect to Letters of Credit or Bankers’
Acceptances issued by it prior to such replacement but shall not be required to
issue additional Letters of Credit.
 
(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, (i) in the case of an Event of Default described in Section 7.01(h)
or (i), on the Business Day or (ii) in the case of any other Event of Default,
on the third Business Day, in each case, following the date on which the Company
receives notice from the Administrative Agent (or, if the maturity of the Loans
has been accelerated, Revolving Lenders with Revolving L/C - BA Exposure
representing greater than 50% of the total Revolving L/C - BA Exposure)
demanding the deposit of cash collateral pursuant to this paragraph, the
Borrowers shall deposit in an account with the Administrative Agent, in the name
of the Administrative Agent and for the benefit of the Lenders, an amount in
cash equal to the Revolving L/C - BA Exposure as of such date plus any accrued
and unpaid interest thereon; provided, that upon the occurrence of any Event of
Default with respect to any Borrower described in clause (h) or (i) of
Section 7.01, the obligation to deposit such cash collateral shall become
effective immediately, and such deposit shall become immediately due and
payable, without demand or other notice of any kind. Each such deposit pursuant
to this paragraph shall be held by the Administrative Agent as collateral for
the payment and performance of the obligations of the Borrowers under this
Agreement. The Administrative Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account. Other than any
interest earned on the investment of such deposits, which investments shall be
made at the option and sole discretion of (i) for so long as an Event of Default
shall be continuing, the Administrative Agent and (ii) at any other time, the
Borrowers, in each case, in Permitted Investments and at the risk and expense of
the Borrowers, such deposits shall not bear interest. Interest or profits, if
any, on such investments shall accumulate in such account. Moneys in such
account shall be applied by the Administrative Agent to reimburse each Issuing
Bank for L/C - BA Disbursements for which such Issuing Bank has not been
reimbursed and, to the extent not so applied, shall be held for the satisfaction
of the reimbursement obligations of the Borrowers for the Revolving L/C - BA
Exposure at such time or, if the maturity of the Loans has been accelerated (but
subject to the consent of Revolving Lenders with Revolving L/C - BA Exposure
representing greater than 50% of the total Revolving L/C - BA Exposure), be
applied to satisfy other obligations of the Borrowers under this Agreement. If
the Borrowers are required to provide an amount of cash
 

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collateral hereunder as a result of the occurrence of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to the
Borrowers within three Business Days after all Events of Default have been cured
or waived.
 
(k) Additional Issuing Banks. From time to time, the Borrowers may by notice to
the Administrative Agent designate one or more Lenders (in addition to Bank of
America, Credit Suisse and Deutsche Bank AG New York Branch) each of which
agrees (in its sole discretion) to act in such capacity and is reasonably
satisfactory to the Administrative Agent as an Issuing Bank. Each such
additional Issuing Bank shall execute a counterpart of this Agreement upon the
approval of the Administrative Agent (which approval shall not be unreasonably
withheld) and shall thereafter be an Issuing Bank hereunder for all purposes.
 
(l) Reporting. Unless otherwise requested by the Administrative Agent, each
Issuing Bank shall (i) provide to the Administrative Agent copies of any notice
received from the Borrowers pursuant to Section 2.05(b) no later than the next
Business Day after receipt thereof and (ii) report in writing to the
Administrative Agent (A) on or prior to each Business Day on which such Issuing
Bank expects to issue, amend or extend any Letter of Credit, the date of such
issuance, amendment or extension, and the aggregate face amount of the Letters
of Credit to be issued, amended or extended by it and outstanding after giving
effect to such issuance, amendment or extension occurred (and whether the amount
thereof changed), and the Issuing Bank shall be permitted to issue, amend or
extend such Letter of Credit if the Administrative Agent shall not have advised
the Issuing Bank that such issuance, amendment or extension would not be in
conformity with the requirements of this Agreement, (B) on each Business Day on
which such Issuing Bank makes any L/C - BA Disbursement or creates any Bankers’
Acceptance, the date of such L/C - BA Disbursement or Bankers’ Acceptance and
the amount of such L/C - BA Disbursement or Bankers’ Acceptance and (C) on any
other Business Day, such other information as the Administrative Agent shall
reasonably request, including but not limited to prompt verification of such
information as may be requested by the Administrative Agent.
 
SECTION 2.06. Funding of Borrowings. v) Each Lender shall make each Loan to be
made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, Local Time, to the account of the
Administrative Agent most recently designated by it for such purpose by notice
to the Lenders; provided, that Swingline Loans and Agent Advances shall be made
as provided in Section 2.04. The Administrative Agent will make such Loans
available to the Borrowers by promptly crediting the amounts so received, in
like funds, to an account of the Borrowers maintained with the Administrative
Agent in New York City; provided, that ABR Revolving Loans and Swingline
Borrowings made to finance the reimbursement of a L/C - BA Disbursement and
reimbursements as provided in Section 2.05(e) shall be remitted by the
Administrative Agent to the applicable Issuing Bank.
 
(b) Unless the Administrative Agent shall have received notice from a Lender
prior to the proposed date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender’s share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
on such date in accordance with paragraph (a) of this Section and may, in
reliance upon such assumption, make available to the Borrowers 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
 

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the Borrowers severally agree to pay to the Administrative Agent forthwith on
demand (without duplication) such corresponding amount with interest thereon,
for each day from and including the date such amount is made available to the
Borrowers to but excluding the date of payment to the Administrative Agent, at
(i) in the case of such Lender, the Federal Funds Effective Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation or (ii) in the case of the Borrowers, the interest
rate applicable to ABR Loans at such time. If such Lender pays such amount to
the Administrative Agent, then such amount shall constitute such Lender’s Loan
included in such Borrowing.
 
SECTION 2.07. Interest Elections. vi) Each Borrowing initially shall be of the
Type specified in the applicable Borrowing Request and, in the case of a
Eurocurrency Borrowing, shall have an initial Interest Period as specified in
such Borrowing Request. Thereafter, any Borrower may elect to convert such
Borrowing to a different Type or to continue such Borrowing and, in the case of
a Eurocurrency Borrowing, may elect Interest Periods therefor, all as provided
in this Section. Any Borrower may elect different options with respect to
different portions of the affected Borrowing, in which case each such portion
shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing. This Section shall not apply to Swingline Borrowings or
Agent Advances, which may not be converted or continued.
 
(b) To make an election pursuant to this Section, the applicable Borrower shall
notify the Administrative Agent of such election by telephone by the time that a
Borrowing Request would be required under Section 2.03 if such Borrower were
requesting a Borrowing of the Type resulting from such election to be made on
the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Interest Election Request in a
form approved by the Administrative Agent and signed by the applicable Borrower.
 
(c) Each telephonic and written Interest Election Request shall specify the
following information in compliance with Section 2.02:
 
(i) the Borrowing to which such Interest Election Request applies and, if
different options are being elected with respect to different portions thereof,
the portions thereof to be allocated to each resulting Borrowing (in which case
the information to be specified pursuant to clauses (iii) and (iv) below shall
be specified for each resulting Borrowing);
 
(ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;
 
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurocurrency Borrowing; and
 
(iv) if the resulting Borrowing is a Eurocurrency Borrowing, the Interest Period
to be applicable thereto after giving effect to such election, which shall be a
period contemplated by clause (a) of the definition of the term “Interest
Period.”
 

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If any such Interest Election Request requests a Eurocurrency Borrowing but does
not specify an Interest Period, then the applicable Borrower shall be deemed to
have selected an Interest Period of one month’s duration.
 
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender to which such Interest Election
Request relates of the details thereof and of such Lender’s portion of each
resulting Borrowing.
 
(e) If any Borrower fails to deliver a timely Interest Election Request with
respect to a Eurocurrency Borrowing prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an ABR
Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default
has occurred and is continuing and the Administrative Agent, at the written
request (including a request through electronic means) of the Required Lenders,
so notifies the applicable Borrower, then, so long as an Event of Default is
continuing (i) no outstanding Borrowing may be converted to or continued as a
Eurocurrency Borrowing and (ii) unless repaid, each Eurocurrency Borrowing shall
be converted to an ABR Borrowing at the end of the Interest Period applicable
thereto.
 
SECTION 2.08. Termination and Reduction of Commitments. vii) Unless previously
terminated, the Revolving Facility Commitments shall terminate on the Revolving
Facility Maturity Date.
 
(b) The Borrowers may at any time terminate, or from time to time reduce, the
Revolving Facility Commitments; provided, that (i) each reduction of the
Revolving Facility Commitments shall be in an amount that is an integral
multiple of $1 million and not less than $5 million (or, if less, the remaining
amount of the Revolving Facility Commitments), and (ii) the Borrowers shall not
terminate or reduce the Revolving Facility Commitments if, after giving effect
to any concurrent prepayment of the Revolving Loans in accordance with
Section 2.11, the Revolving Facility Credit Exposure would exceed the Borrowing
Base.
 
(c) The Borrowers shall notify the Administrative Agent of any election to
terminate or reduce the Revolving Facility Commitments under paragraph (b) of
this Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the applicable Lenders of the contents thereof. Each notice
delivered by the Borrowers pursuant to this Section shall be irrevocable;
provided, that a notice of termination of the Revolving Facility Commitments
delivered by the Borrowers may state that such notice is conditioned upon the
effectiveness of other credit facilities, in which case such notice may be
revoked by the Borrowers (by notice to the Administrative Agent on or prior to
the specified effective date) if such condition is not satisfied. Any
termination or reduction of the Revolving Facility Commitments shall be
permanent. Each reduction of the Revolving Facility Commitments shall be made
ratably among the Lenders in accordance with their respective Revolving Facility
Commitments.
 
SECTION 2.09. Repayment of Loans; Evidence of Debt. viii) The Borrowers hereby
unconditionally promise to pay (i) to the Administrative Agent for the account
of each
 

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Revolving Lender the then unpaid principal amount of each Revolving Loan to the
Borrowers on the Revolving Facility Maturity Date, (ii) to the Swingline Lender
the then unpaid principal amount of each Swingline Loan on the Revolving
Facility Maturity Date, and (iii) to the Administrative Agent the then unpaid
principal amount of each Agent Advance on the Revolving Facility Maturity
Date; provided, that on each date that a Revolving Facility Borrowing is made by
any Borrower, the Borrowers shall repay all Swingline Loans and Agent Advances
then outstanding.
 
(b) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the indebtedness of the Borrowers to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.
 
(c) The Administrative Agent shall maintain accounts in which it shall record
(i) the amount of each Loan made hereunder, the Type thereof and the Interest
Period (if any) applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrowers to each Lender
hereunder and (iii) any amount received by the Administrative Agent hereunder
for the account of the Lenders and each Lender’s share thereof.
 
(d) The entries made in the accounts maintained pursuant to paragraph (b) or (c)
of this Section shall be prima facie evidence of the existence and amounts of
the obligations recorded therein; provided, that the failure of any Lender or
the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligation of the Borrowers to repay the Loans in
accordance with the terms of this Agreement.
 
(e) Any Lender may request that Loans made by it be evidenced by a promissory
note (a “Note”). In such event, the Borrowers shall prepare, execute and deliver
to such Lender a promissory note payable to the order of such Lender (or, if
requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent and reasonably acceptable to the
Borrowers. Thereafter, the Loans evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to Section 9.04)
be represented by one or more promissory notes in such form payable to the order
of the payee named therein (or, if such promissory note is a registered note, to
such payee and its registered assigns).
 
SECTION 2.10. Repayment of Revolving Loans. ix)  To the extent not previously
paid, outstanding Revolving Loans shall be due and payable on the Revolving
Facility Maturity Date.
 
(b) Prior to any repayment of any Loan hereunder, the Borrowers shall select the
Borrowing or Borrowings to be repaid and shall notify the Administrative Agent
by telephone (confirmed by telecopy) of such selection not later than 1:00 p.m.,
Local Time, (i) in the case of an ABR Borrowing, one Business Day before the
scheduled date of such repayment and (ii) in the case of a Eurocurrency
Borrowing, three Business Days before the scheduled date of such repayment. Each
repayment of a Borrowing shall be applied to the Revolving Loans included in the
repaid Borrowing such that each Revolving Lender receives its ratable share of
such repayment (based upon the respective Revolving Facility Credit Exposures of
the
 

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Revolving Lenders at the time of such repayment). Notwithstanding anything to
the contrary in the immediately preceding sentence, prior to any repayment of a
Swingline Loan hereunder, the Borrowers shall select the Borrowing or Borrowings
to be repaid and shall notify the Administrative Agent by telephone (confirmed
by telecopy) of such selection not later than 1:00 p.m., Local Time, on the
scheduled date of such repayment. Repayments of Loans shall be accompanied by
accrued interest on the amount repaid.
 
(c) All payments of interest, fees and reimbursement for expenses pursuant to
Section 9.05(a) may, if not paid by the due date, at the option of the
Administrative Agent, be paid from the proceeds of Revolving Loans made
hereunder, whether made following a request by the Borrowers pursuant to Section
2.01 or a deemed request as provided in this Section 2.10 (c). Upon the
occurrence and during the continuance of any Event of Default, the Borrowers
hereby irrevocably authorize the Administrative Agent to charge the Loan Account
on the due date for the purpose of paying interest, fees and reimbursing
expenses pursuant to Section 9.05(a) and agree that all such accounts charged
shall constitute Revolving Loans (including Swingline Loans and Agent Advances)
and that all such Revolving Loans so made shall be deemed to have been requested
pursuant to Section 2.01 (except the Borrowers shall not be deemed to make any
representation or warranty pursuant to Section 4.01(b) with respect to such
Revolving Loans).
 
SECTION 2.11. Prepayment of Loans. x) The Borrowers shall have the right at any
time and from time to time to prepay any Loan in whole or in part, without
premium or penalty (but subject to Section 2.16), in an aggregate principal
amount that is an integral multiple of the Borrowing Multiple and not less than
the Borrowing Minimum or, if less, the amount outstanding, subject to prior
notice in accordance with Section 2.10(d).
 
(b) In the event and on such occasion that the total Revolving Facility Credit
Exposure exceeds the Borrowing Base (including any reduction in the Borrowing
Base as a result of a sale or other disposition of Eligible Inventory or
Eligible Accounts outside the ordinary course of business), the Borrowers shall
prepay Revolving Facility Borrowings, Swingline Borrowings or Agent Advances
(or, if no such Borrowings or Agent Advances are outstanding, deposit cash
collateral in an account with the Administrative Agent pursuant to Section
2.05(j)) in an aggregate amount equal to such excess.
 
(c) In the event and on such occasion as the Revolving L/C-BA Exposure exceeds
(i) the Letter of Credit Sublimit or (ii) the Borrowing Base, the Borrowers
shall deposit cash collateral in an account with the Administrative Agent
pursuant to Section 2.05(j) in an amount equal to such excess.
 
SECTION 2.12. Fees. xi) The Borrowers agree to pay to each Lender (other than
any Defaulting Lender), through the Administrative Agent, on the fifth Business
Day of each calendar quarter and on the Revolving Facility Maturity Date and, if
earlier, on the date on which the Revolving Facility Commitments of all the
Lenders shall be terminated as provided herein, a commitment fee (a “Commitment
Fee”) on the daily amount of the Available Unused Commitment of such Lender
during the preceding quarter (or other period commencing with the Closing Date
or ending with the date on which the last of the Commitments of such Lender
shall be terminated) at a rate equal to (i) if the average daily amount of the
aggregate Available
 

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Unused Commitments of all Lenders during such period is less than 50% of
Revolving Facility Commitments, 0.25% per annum, and (ii) otherwise, 0.30% per
annum. All Commitment Fees shall be computed on the basis of the actual number
of days elapsed in a year of 360 days. For the purpose of calculating any
Lender’s Commitment Fee, the outstanding Swingline Loans during the period for
which such Lender’s Commitment Fee is calculated shall be deemed to be zero. The
Commitment Fee due to each Lender shall commence to accrue on the Closing Date
and shall cease to accrue on the date on which the last of the Commitments of
such Lender shall be terminated as provided herein. 
 
(b) The Borrowers from time to time agree to pay (i) to each Revolving Lender
(other than any Defaulting Lender), through the Administrative Agent, on the
fifth Business Day of each calendar quarter and on the Revolving Facility
Maturity Date and, if earlier, on the date on which the Revolving Facility
Commitments of all the Lenders shall be terminated as provided herein, a fee (an
“L/C - BA Participation Fee”) on such Lender’s Pro Rata Share of the daily
aggregate Revolving L/C - BA Exposure (excluding the portion thereof
attributable to unreimbursed L/C - BA Disbursements) during the preceding
quarter (or shorter period commencing with the Closing Date or ending with the
Revolving Facility Maturity Date or the date on which the Revolving Facility
Commitments shall be terminated) at the rate per annum equal to the Applicable
Margin for Eurocurrency Revolving Facility Borrowings on such payment date, and
(ii) to the Issuing Bank, on the fifth Business Day of each calendar quarter and
on the Revolving Facility Maturity Date and, if earlier, on the date on which
the Revolving Facility Commitments of all the Lenders shall be terminated as
provided herein, a fronting fee in respect of each Letter of Credit issued by
such Issuing Bank and outstanding during the preceding quarter (or shorter
period commencing with the Closing Date or ending with the Revolving Facility
Maturity Date or the date on which the Revolving Facility Commitments shall be
terminated) at a rate per annum equal to 1/8 of 1% per annum of the stated
amount of such Letter of Credit, plus (y) in connection with the issuance,
amendment or transfer of any such Letter of Credit or any L/C - BA Disbursement
thereunder, such Issuing Bank’s customary documentary and processing fees and
charges (collectively, “Issuing Bank Fees”). All L/C Participation Fees and
Issuing Bank Fees that are payable on a per annum basis shall be computed on the
basis of the actual number of days elapsed in a year of 360 days.
 
(c) The Borrowers agree to pay to the Administrative Agent and the Joint Lead
Arrangers, for the account of the Administrative Agent and the Joint Lead
Arrangers, as the case may be, the fees set forth in the Fee Letter, as amended,
restated, supplemented or otherwise modified from time to time, at the times
specified therein (the “Administrative Agent Fees”).
 
(d) All Fees shall be paid on the dates due, in immediately available funds, to
the Administrative Agent for distribution, if and as appropriate, among the
Lenders, except that Issuing Bank Fees shall be paid directly to the applicable
Issuing Banks. Once paid, none of the Fees shall be refundable under any
circumstances.
 
SECTION 2.13. Interest. xii) The Loans comprising each ABR Borrowing (including
each Swingline Loan and each Agent Advance) shall bear interest at the ABR plus
the Applicable Margin.
 

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(b) The Loans comprising each Eurocurrency Borrowing shall bear interest at the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Margin.
 
(c) Notwithstanding the foregoing, if any principal of or interest on any Loan
or any Fees or other amount payable by the Borrowers hereunder is not paid when
due, whether at stated maturity, upon acceleration or otherwise, such overdue
amount shall bear interest, after as well as before judgment, at a rate per
annum equal to (i) in the case of overdue principal of any Loan, 2% plus the
rate otherwise applicable to such Loan as provided in the preceding paragraphs
of this Section or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Loans as provided in paragraph (a) of this Section; provided,
that this paragraph (c) shall not apply to any Event of Default that has been
waived by the Lenders pursuant to Section 9.08.
 
(d) Accrued interest on each Loan shall be payable in arrears (i) on each
Interest Payment Date for such Loan, and (ii) upon termination of the Revolving
Facility Commitments; provided, that (A) interest accrued pursuant to
paragraph (c) of this Section shall be payable on demand, (B) in the event of
any repayment or prepayment of any Loan (other than a prepayment of an ABR
Revolving Loan prior to the end of the Availability Period), accrued interest on
the principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment, and (C) in the event of any conversion of any
Eurocurrency Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.
 
(e) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the ABR at times when the ABR is
based on the “prime rate” shall be computed on the basis of a year of 365 days
(or 366 days in a leap year), and in each case shall be payable for the actual
number of days elapsed (including the first day but excluding the last day). The
applicable ABR, Adjusted LIBO Rate or LIBO Rate shall be determined by the
Administrative Agent, and such determination shall be conclusive absent manifest
error.
 
SECTION 2.14. Alternate Rate of Interest. If prior to the commencement of any
Interest Period for a Eurocurrency Borrowing:
 
(a) the Administrative Agent determines (which determination shall be conclusive
absent manifest error) that adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period; or
 
(b) the Administrative Agent is advised by the Required Lenders that the
Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period
will not adequately and fairly reflect the cost to such Lenders of making or
maintaining their Loans included in such Borrowing for such Interest Period;
 
then the Administrative Agent shall give notice thereof to the Company and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Company and the Lenders that the
circumstances giving rise to such notice no longer
 

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exist, (i) any Interest Election Request that requests the conversion of any
Borrowing to, or continuation of any Borrowing as, a Eurocurrency Borrowing
denominated in such currency shall be ineffective and such Borrowing shall be
converted to or continued as on the last day of the Interest Period applicable
thereto an ABR Borrowing, and (ii) if any Borrowing Request requests a
Eurocurrency Borrowing, such Borrowing shall be made as an ABR Borrowing.
 
SECTION 2.15. Increased Costs. xiii) If any Change in Law shall:
 
(i) impose, modify or deem applicable any reserve, special deposit or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Lender (except any such reserve requirement reflected in the
Adjusted LIBO Rate) or Issuing Bank; or
 
(ii) impose on any Lender or Issuing Bank or the London interbank market any
other condition affecting this Agreement or Eurocurrency 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 of making or maintaining any Eurocurrency Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or Issuing
Bank hereunder (whether of principal, interest or otherwise), then the Borrowers
will pay to such Lender or Issuing Bank, as applicable, such additional amount
or amounts as will compensate such Lender or Issuing Bank, as applicable, for
such additional costs incurred or reduction suffered.
 
(b) If any Lender or Issuing Bank determines that any Change in Law regarding
capital requirements has or would have the effect of reducing the rate of return
on such Lender’s or Issuing Bank’s capital or on the capital of such Lender’s or
Issuing Bank’s holding company, if any, as a consequence of this Agreement 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 Bank, to a
level below that which such Lender or such Issuing Bank or such Lender’s or such
Issuing Bank’s holding company could have achieved but for such Change in Law
(taking into consideration such Lender’s or such Issuing Bank’s policies and the
policies of such Lender’s or such Issuing Bank’s holding company with respect to
capital adequacy), then from time to time the Borrowers shall pay to such Lender
or such Issuing Bank, as applicable, such additional amount or amounts as will
compensate such Lender or such Issuing Bank or such Lender’s or such Issuing
Bank’s holding company for any such reduction suffered.
 
(c) A certificate of a Lender or an Issuing Bank setting forth the amount or
amounts necessary to compensate such Lender or Issuing Bank or its holding
company, as applicable, as specified in paragraph (a) or (b) of this Section
2.15 shall be delivered to the Company and shall be conclusive absent manifest
error. The Borrowers shall pay such Lender or Issuing Bank, as applicable, the
amount shown as due on any such certificate within 10 days after receipt
thereof.
 

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(d) Promptly after any Lender or any Issuing Bank has determined that it will
make a request for increased compensation pursuant to this Section 2.15, such
Lender or Issuing Bank shall notify the Company thereof. Failure or delay on the
part of any Lender or Issuing Bank to demand compensation pursuant to this
Section 2.15 shall not constitute a waiver of such Lender’s or Issuing Bank’s
right to demand such compensation; provided, that the Borrowers shall not be
required to compensate a Lender or an Issuing Bank pursuant to this Section 2.15
for any increased costs or reductions incurred more than 180 days prior to the
date that such Lender or Issuing Bank, as applicable, notifies the Company of
the Change in Law giving rise to such increased costs or reductions and of such
Lender’s or Issuing Bank’s intention to claim compensation therefor; provided,
further, that, if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the 180-day period referred to above shall be
extended to include the period of retroactive effect thereof.
 
(e) The foregoing provisions of this Section 2.15 shall not apply in the case of
any Change in Law in respect of Taxes, which shall instead be governed by
Section 2.17.
 
SECTION 2.16. Break Funding Payments. In the event of (a) the payment of any
principal of any Eurocurrency Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default), (b)
the conversion of any Eurocurrency Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any Eurocurrency Loan on the date specified in any notice delivered
pursuant hereto or (d) the assignment of any Eurocurrency Loan other than on the
last day of the Interest Period applicable thereto as a result of a request by a
Borrower pursuant to Section 2.19, then, in any such event, the Borrowers shall
compensate each Lender for the loss, cost and expense attributable to such
event. In the case of a Eurocurrency Loan, such loss, cost or expense to any
Lender shall be deemed to be the amount determined by such Lender (it being
understood that the deemed amount shall not exceed the actual amount) to be the
excess, if any, of (i) the amount of interest which would have accrued on the
principal amount of such Loan had such event not occurred, at the Adjusted LIBO
Rate that would have been applicable to such Loan, for the period from the date
of such event to the last day of the then current Interest Period therefor (or,
in the case of a failure to borrow, convert or continue a Eurocurrency Loan, for
the period that would have been the Interest Period for such Loan), over (ii)
the amount of interest which would accrue on such principal amount for such
period at the interest rate which such Lender would bid were it to bid, at the
commencement of such period, for deposits in dollars of a comparable amount and
period from other banks in the Eurodollar market. A certificate of any Lender
setting forth any amount or amounts that such Lender is entitled to receive
pursuant to this Section 2.16 shall be delivered to the Company and shall be
conclusive absent manifest error. The Borrowers shall pay such Lender the amount
shown as due on any such certificate within 10 days after receipt thereof.
 
SECTION 2.17. Taxes. xiv) Any and all payments by or on account of any
obligation of any Loan Party hereunder shall be made free and clear of and
without deduction for any Indemnified Taxes or Other Taxes; provided, that if a
Loan Party shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, any Lender
or any Issuing Bank, as applicable, receives an amount equal to the sum it would
have received
 

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had no such deductions been made, (ii) such Loan Party shall make such
deductions and (iii) such Loan Party shall timely pay the full amount deducted
to the relevant Governmental Authority in accordance with applicable law.
 
(b) In addition, the Loan Parties shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.
 
(c) Each Loan Party shall indemnify the Administrative Agent, each Lender and
each Issuing Bank, within 10 days after written demand therefor, for the full
amount of any Indemnified Taxes or Other Taxes paid by the Administrative Agent,
such Lender or such Issuing Bank, as applicable, on or with respect to any
payment by or on account of any obligation of such Loan Party hereunder
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any reasonable expenses
arising therefrom or with respect thereto, whether or not such Indemnified Taxes
or Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to such Loan Party by a Lender or an Issuing Bank, or by the
Administrative Agent on its own behalf, on behalf of another Agent or on behalf
of a Lender or an Issuing Bank, shall be conclusive absent manifest error.
 
(d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes
by a Loan Party to a Governmental Authority, such Loan Party shall deliver to
the Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.
 
(e) Any Lender that is entitled to an exemption from or reduction of withholding
Tax under the law of the jurisdiction in which any Borrower is located, or any
treaty to which such jurisdiction is a party, with respect to payments under
this Agreement shall deliver to the Company (with a copy to the Administrative
Agent), to the extent such Lender is legally entitled to do so, at the time or
times prescribed by applicable law, such properly completed and executed
documentation prescribed by applicable law as may reasonably be requested by the
Company to permit such payments to be made without such withholding Tax or at a
reduced rate; provided, that no Lender shall have any obligation under this
paragraph (e) with respect to any withholding Tax imposed by any jurisdiction
other than the United States if in the reasonable judgment of such Lender such
compliance would subject such Lender to any material unreimbursed cost or
expense or would otherwise be disadvantageous to such Lender in any material
respect.
 
(f) Each Lender shall deliver to the Company and the Administrative Agent on the
date on which such Lender becomes a Lender under this Agreement (and from time
to time thereafter upon the reasonable request of the Company or the
Administrative Agent), two original copies of whichever of the following is
applicable: (i) duly completed copies of Internal Revenue Service Form W-8BEN
(or any subsequent versions thereof or successors thereto), claiming eligibility
for benefits of an income tax treaty to which the United States of America is a
party, (ii) duly completed copies of Internal Revenue Service Form W-8ECI (or
any subsequent versions thereof or successors thereto), (iii) in the case of a
Lender claiming the
 

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benefits of the exemption for portfolio interest under section 871(h) or 881(c)
of the Code, (x) a certificate to the effect that, for United States federal
income tax purposes, such Lender is not (A) a “bank” within the meaning of
section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of any Borrower
within the meaning of section 871(h)(3) or 881(c)(3)(B) of the Code, or (C) a
“controlled foreign corporation” described in section 881(c)(3)(C) of the Code
and that, accordingly, such Lender qualifies for such exemption and (y) duly
completed copies of Internal Revenue Service Form W-8BEN (or any subsequent
versions thereof or successors thereto), (iv) duly completed copies of Internal
Revenue Service Form W-8IMY, together with forms and certificates described in
clauses (i) through (iii) above (and additional Form W-8IMYs) as may be required
or (v) any other form prescribed by applicable law as a basis for claiming
exemption from or a reduction in United States federal withholding tax duly
completed together with such supplementary documentation as may be prescribed by
applicable law to permit the Borrowers to determine the withholding or deduction
required to be made. In addition, in each of the foregoing circumstances, each
Lender shall deliver such forms, if legally entitled to deliver such forms,
promptly upon the obsolescence, expiration or invalidity of any form previously
delivered by such Lender. Each Lender shall promptly notify the Company at any
time it determines that it is no longer in a position to provide any previously
delivered certificate to the Company (or any other form of certification adopted
by the United States of America or other taxing authorities for such purpose).
In addition, each Lender shall deliver to the Company and the Administrative
Agent two copies of Internal Revenue Service Form W-9 (or any subsequent
versions thereof or successors thereto) on or before the date such Lender
becomes a party and upon the expiration of any form previously delivered by such
Lender. Notwithstanding any other provision of this paragraph, a Lender shall
not be required to deliver any form pursuant to this paragraph that such Lender
is not legally able to deliver.
 
(g) If the Administrative Agent or a Lender receives a refund of any Indemnified
Taxes or Other Taxes as to which it has been indemnified by a Loan Party or with
respect to which such Loan Party has paid additional amounts pursuant to this
Section 2.17, it shall pay over such refund to such Loan Party (but only to the
extent of indemnity payments made, or additional amounts paid, by such Loan
Party under this Section 2.17 with respect to the Taxes or Other Taxes giving
rise to such refund), net of all out-of-pocket expenses of the Administrative
Agent or such Lender (including any Taxes imposed with respect to such refund)
as is determined by the Administrative Agent or such Lender, as applicable, in
good faith and in its sole discretion, and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
refund); provided, that such Loan Party, upon the request of the Administrative
Agent or such Lender, agrees to repay as soon as reasonably practicable the
amount paid over to such Loan Party (plus any penalties, interest or other
charges imposed by the relevant Governmental Authority) to the Administrative
Agent or such Lender in the event the Administrative Agent or such Lender is
required to repay such refund to such Governmental Authority. This
Section 2.17(g) shall not be construed to require the Administrative Agent or
any Lender to make available its Tax returns (or any other information relating
to its Taxes which it deems confidential) to the Loan Parties or any other
person.
 
SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs. xv)
Unless otherwise specified, each Borrower shall make each payment required to be
made by it hereunder (whether of principal, interest, fees or reimbursement of
L/C - BA Disbursements, or of amounts payable under Section 2.15, 2.16, or 2.17,
or otherwise) prior to 2:00 p.m., Local
 

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Time, on the date when due, in immediately available funds, without condition or
deduction for any defense, recoupment, set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent to the applicable account designated
to the Borrowers by the Administrative Agent, except payments to be made
directly to the applicable Issuing Bank or the Swingline Lender as expressly
provided herein and except that payments pursuant to Sections 2.15, 2.16, 2.17
and 9.05 shall be made directly to the persons entitled thereto. The
Administrative Agent shall distribute any such payments received by it for the
account of any other person to the appropriate recipient promptly following
receipt thereof. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments under
the Loan Documents shall be made in Dollars. Any payment required to be made by
the Administrative Agent hereunder shall be deemed to have been made by the time
required if the Administrative Agent shall, at or before such time, have taken
the necessary steps to make such payment in accordance with the regulations or
operating procedures of the clearing or settlement system used by the
Administrative Agent to make such payment.
 
(b) If at any time insufficient funds are received by and available to the
Administrative Agent from the Borrowers to pay fully all amounts of principal,
unreimbursed L/C - BA Disbursements, interest and fees then due from the
Borrowers hereunder, such funds shall be applied (i) first, towards payment of
interest and fees then due from the Borrowers hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (ii) second, towards payment of principal and
unreimbursed L/C - BA Disbursements then due from the Borrowers hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed L/C - BA Disbursements then due to such parties.
 
(c) If any Lender shall, by exercising any right of set-off or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Revolving Loans or participations in L/C - BA Disbursements or Swingline
Loans resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Revolving Loans and participations in L/C - BA
Disbursements and Swingline Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the
Revolving Loans and participations in L/C - BA Disbursements and Swingline Loans
of other Lenders to the extent necessary so that the benefit of all such
payments shall be shared by the Lenders ratably in accordance with the aggregate
amount of principal of and accrued interest on their respective Revolving Loans
and participations in L/C - BA Disbursements and Swingline Loans; 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 (c) shall not be construed
to apply to any payment made by the Borrowers pursuant to and in accordance with
the express terms of this Agreement or any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans or participations in L/C - BA Disbursements to any assignee or
participant, other than to the Borrowers or any Subsidiary or
 

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Affiliate thereof (as to which the provisions of this paragraph (c) shall
apply). Each Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against such
Borrower rights of set-off and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of such Borrower in the amount
of such participation.
 
(d) Unless the Administrative Agent shall have received notice from the
Borrowers prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders or the applicable Issuing Bank hereunder
that the Borrowers will not make such payment, the Administrative Agent may
assume that the Borrowers have made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the applicable Issuing Bank, as applicable, the amount due. In such event, if
the Borrowers have not in fact made such payment, then each of the Lenders or
the applicable Issuing Bank, as applicable, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of payment
to the Administrative Agent, at the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation.
 
(e) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.06(b) or 2.18(d), then the Administrative Agent may, in
its discretion (notwithstanding any contrary provision hereof), apply any
amounts thereafter received by the Administrative Agent for the account of such
Lender to satisfy such Lender’s obligations under such Sections until all such
unsatisfied obligations are fully paid.
 
SECTION 2.19. Mitigation Obligations; Replacement of Lenders. xvi)  If any
Lender requests compensation under Section 2.15, or if the Borrowers are
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, then such
Lender shall use reasonable efforts to designate a different Lending Office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or Affiliates, if, in the
reasonable judgment of such Lender, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 2.15 or 2.17, as
applicable, in the future and (ii) would not subject such Lender to any material
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender in any material respect. The Borrowers hereby agree to pay all reasonable
costs and expenses incurred by any Lender in connection with any such
designation or assignment.
 
(b) If any Lender requests compensation under Section 2.15, or if the Borrowers
are required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, or is a
Defaulting Lender, then the Borrowers may, at their sole expense and effort,
upon notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in Section 9.04), all its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided, that (i) the
 

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Borrowers shall have received the prior written consent of the Administrative
Agent (and, if in respect of any Revolving Facility Commitment or Revolving
Loan, the Swingline Lender and the Issuing Bank), which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Loans and participations in L/C
- BA Disbursements and Swingline Loans, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder, from the assignee (to the extent
of such outstanding principal and accrued interest and fees) or the Borrowers
(in the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.15 or payments required
to be made pursuant to Section 2.17, such assignment will result in a reduction
in such compensation or payments. Nothing in this Section 2.19 shall be deemed
to prejudice any rights that the Borrowers may have against any Lender that is a
Defaulting Lender.
 
(c) If any Lender (such Lender, a “Non-Consenting Lender”) has failed to consent
to a proposed amendment, waiver, discharge or termination which pursuant to the
terms of Section 9.08 requires the consent of all of the Lenders affected and
with respect to which the Required Lenders shall have granted their consent,
then the Borrowers shall have the right (unless such Non-Consenting Lender
grants such consent) to replace such Non-Consenting Lender by deeming such
Non-Consenting Lender to have assigned its Loans, and its Commitments hereunder
to one or more Assignees reasonably acceptable to (i) the Administrative Agent
and (ii) if in respect of any Revolving Facility Commitment or Revolving Loan,
the Swingline Lender and the Issuing Bank; provided, that: (a) all Obligations
of the Borrowers owing to such Non-Consenting Lender being replaced shall be
paid in full to such Non-Consenting Lender concurrently with such assignment,
and (b) the replacement Lender shall purchase the foregoing by paying to such
Non-Consenting Lender a price equal to the principal amount thereof plus accrued
and unpaid interest thereon. No action by or consent of the Non-Consenting
Lender shall be necessary in connection with such assignment, which shall be
immediately and automatically effective upon payment of such purchase price. In
connection with any such assignment, the Borrowers, Administrative Agent, such
Non-Consenting Lender and the replacement Lender shall otherwise comply with
Section 9.04; provided, that if such Non-Consenting Lender does not comply with
Section 9.04 within three Business Days after Borrowers’ request, compliance
with Section 9.04 shall not be required to effect such assignment.
 
SECTION 2.20. Illegality. If any Lender reasonably determines that any Change in
Law has made it unlawful, or that any Governmental Authority has asserted after
the Closing Date that it is unlawful, for any Lender or its applicable Lending
Office to make or maintain any Eurocurrency Loans, then, on notice thereof by
such Lender to the Company through the Administrative Agent, any obligations of
such Lender to make or continue Eurocurrency Loans or to convert ABR Borrowings
to Eurocurrency Borrowings shall be suspended until such Lender notifies the
Administrative Agent and the Company that the circumstances giving rise to such
determination no longer exist. Upon receipt of such notice, the Borrowers shall
upon demand from such Lender (with a copy to the Administrative Agent), either
convert all Eurocurrency Borrowings of such Lender to ABR Borrowings, either on
the last day of the Interest Period therefor, if such Lender may lawfully
continue to maintain such Eurocurrency Borrowings to such day, or immediately,
if such Lender may not lawfully continue to maintain
 

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such Loans. Upon any such prepayment or conversion, the Borrowers shall also pay
accrued interest on the amount so prepaid or converted.
 
SECTION 2.21. Incremental Commitments. (a)  The Borrowers may, by written notice
to the Administrative Agent from time to time, request Incremental Revolving
Facility Commitments in an amount not to exceed the Incremental Amount from one
or more Incremental Revolving Lenders (which may include any existing Lender)
willing to provide such Incremental Revolving Facility Commitments, as the case
may be, in their own discretion; provided, that (i) each Incremental Revolving
Lender shall be subject to the approval of the Administrative Agent (which
approval shall not be unreasonably withheld) unless such Incremental Revolving
Lender is a Lender, and (ii) each Incremental Revolving Facility Commitment
shall be on the same terms as the existing Revolving Facility Commitments and in
all respects shall become a part of the Revolving Facility hereunder on such
terms. Such notice shall set forth (i) the amount of the Incremental Revolving
Facility Commitments being requested (which shall be in minimum increments of $5
million and a minimum amount of $25 million or equal to the remaining
Incremental Amount), (ii) the aggregate amount of Incremental Revolving Facility
Commitments, which shall not exceed the Incremental Amount, and (iii) the date
on which such Incremental Revolving Facility Commitments are requested to become
effective (the “Increased Amount Date”).
 
(b) The Borrowers and each Incremental Revolving Lender shall execute and
deliver to the Administrative Agent an Incremental Assumption Agreement and such
other documentation as the Administrative Agent shall reasonably specify to
evidence the Incremental Revolving Facility Commitment of such Incremental
Revolving Lender. Each of the parties hereto hereby agrees that upon the
effectiveness of any Incremental Assumption Agreement, this Agreement shall be
deemed amended to the extent (but only to the extent) necessary to increase the
Revolving Facility by the amount of the Incremental Revolving Loan Commitments
evidenced thereby. Any such deemed amendment may be memorialized in writing by
the Administrative Agent with the Borrowers’ consent (not to be unreasonably
withheld) and furnished to the other parties hereto.
 
(c) Notwithstanding the foregoing, no Incremental Revolving Facility Commitment
shall become effective under this Section 2.21 unless (i) on the date of such
effectiveness, the conditions set forth in paragraphs (b) and (c) of Section
4.01 shall be satisfied and the Administrative Agent shall have received a
certificate to that effect dated such date and executed by a Responsible Officer
of the Company, and (ii) the Administrative Agent shall have received legal
opinions, board resolutions and other closing certificates and documentation as
required by the relevant Incremental Assumption Agreement and, to the extent
required by the Administrative Agent, consistent with those delivered on the
Closing Date under Section 4.02 and such additional documents and filings
(including amendments to the Mortgages and other Security Documents and title
endorsement bringdowns) as the Administrative Agent may reasonably require to
assure that the Revolving Loans in respect of Incremental Revolving Facility
Commitments are secured by the Collateral ratably with all other Revolving
Loans.
 
(d) Each of the parties hereto hereby agrees that the Administrative Agent may
take any and all action as may be reasonably necessary to ensure all Revolving
Loans in respect of Incremental Revolving Facility Commitments, when originally
made, are included in
 

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each Borrowing of outstanding Revolving Loans on a pro rata basis. The Borrowers
agree that Section 2.16 shall apply to any conversion of Eurocurrency Loans to
ABR Loans reasonably required by the Administrative Agent to effect the
foregoing.
 
 
ARTICLE III
 
 

 
 
Representations and Warranties
 
On the date of each Credit Event as provided in Section 4.01, each of Holdings
and each of the Borrowers represent and warrant to each of the Lenders that:
 
SECTION 3.01. Organization; Powers. Except as set forth on Schedule 3.01, each
of Holdings, each Borrower and the Material Subsidiaries (a) is a partnership,
limited liability company or corporation duly organized, validly existing and in
good standing (or, if applicable in a foreign jurisdiction, enjoys the
equivalent status under the laws of any jurisdiction of organization outside the
United States) under the laws of the jurisdiction of its organization, (b) has
all requisite power and authority to own its property and assets and to carry on
its business as now conducted, (c) is qualified to do business in each
jurisdiction where such qualification is required, except where the failure so
to qualify would not reasonably be expected to have a Material Adverse Effect,
and (d) has the power and authority to execute, deliver and perform its
obligations under each of the Loan Documents and each other agreement or
instrument contemplated thereby to which it is or will be a party and, in the
case of the Borrowers, to borrow and otherwise obtain credit hereunder.
 
SECTION 3.02. Authorization. The execution, delivery and performance by
Holdings, each Borrower and each of the Subsidiary Loan Parties of each of the
Loan Documents to which it is a party, and the borrowings hereunder and the
transactions forming a part of the Transactions (a) have been duly authorized by
all corporate, stockholder, partnership or limited liability company action
required to be obtained by Holdings, such Borrower and such Subsidiary Loan
Parties and (b) will not (i) violate (A) any provision of law, statute, rule or
regulation, or of the certificate or articles of incorporation or other
constitutive documents (including any partnership, limited liability company or
operating agreements) or by-laws of Holdings, any such Borrower or any such
Subsidiary Loan Party, (B) any applicable order of any court or any rule,
regulation or order of any Governmental Authority or (C) any provision of any
indenture, certificate of designation for preferred stock, agreement or other
instrument to which Holdings, any such Borrower or any such Subsidiary Loan
Party is a party or by which any of them or any of their property is or may be
bound, (ii) be in conflict with, result in a breach of or constitute (alone or
with notice or lapse of time or both) a default under, give rise to a right of
or result in any cancellation or acceleration of any right or obligation
(including any payment) or to a loss of a material benefit under any such
indenture, certificate of designation for preferred stock, agreement or other
instrument, where any such conflict, violation, breach or default referred to in
clause (i) or (ii) of this Section 3.02(b), would reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect, or (iii)
result in the creation or imposition of any Lien upon or with respect to any
property or assets now owned or hereafter acquired by Holdings, any such
Borrower or any such Subsidiary Loan Party, other than the Liens created by the
Loan Documents and Permitted Liens.
 

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SECTION 3.03. Enforceability. This Agreement has been duly executed and
delivered by Holdings and the Borrowers and constitutes, and each other Loan
Document when executed and delivered by each Loan Party that is party thereto
will constitute, a legal, valid and binding obligation of such Loan Party
enforceable against each such Loan Party in accordance with its terms, subject
to (i) the effects of bankruptcy, insolvency, moratorium, reorganization,
fraudulent conveyance or other similar laws affecting creditors’ rights
generally, (ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law) and (iii)
implied covenants of good faith and fair dealing.
 
SECTION 3.04. Governmental Approvals. No action, consent or approval of,
registration or filing with or any other action by any Governmental Authority is
or will be required in connection with the Transactions, the perfection or
maintenance of the Liens created under the Security Documents or the exercise by
any Agent or any Lender of its rights under the Loan Documents or the remedies
in respect of the Collateral, except for (a) the filing of Uniform Commercial
Code financing statements, (b) filings with the United States Patent and
Trademark Office and the United States Copyright Office and comparable offices
in foreign jurisdictions and equivalent filings in foreign jurisdictions, (c)
recordation of the Mortgages, (d) such as have been made or obtained and are in
full force and effect, (e) such actions, consents and approvals the failure of
which to be obtained or made would not reasonably be expected to have a Material
Adverse Effect and (f) filings or other actions listed on Schedule 3.04.
 
SECTION 3.05. Financial Statements. xvii) The unaudited pro forma consolidated
financial information, (the “Pro Forma Financial Statements”) and pro
forma adjusted EBITDA (the “Pro Forma Adjusted EBITDA”), for the twelve months
ended on or about December 30, 2006, copies of which have heretofore been
furnished to each Lender (via inclusion on page 38 the Information Memorandum),
have been prepared giving effect (as if such events had occurred on such date)
to the Transactions. Each of the Pro Forma Financial Statements and the Pro
Forma Adjusted EBITDA has been prepared in good faith based on assumptions
believed by the Borrower to have been reasonable as of the date of delivery
thereof (it being understood that such assumptions are based on good faith
estimates of certain items and that the actual amount of such items on the
Closing Date is subject to change), and presents fairly in all material respects
on a Pro Forma Basis the estimated financial position of the Borrower and its
consolidated Subsidiaries as at December 30, 2006, assuming that the
Transactions had actually occurred at such date, and the results of operations
of Borrower and its consolidated subsidiaries for the twelve-month period ended
December 30, 2006, assuming that the Transactions had actually occurred on the
first day of such twelve-month period.
 
(b) The audited combined balance sheets of each of Covalence (or its
predecessor) and Berry (or its predecessor) as at the end of 2006, 2005 and 2004
fiscal years, and the related audited combined statements of income,
stockholders’ equity and cash flows for such fiscal years, reported on by and
accompanied by a report from Deloitte & Touche LLP, and Ernst & Young LLP,
respectively, copies of which have heretofore been furnished to each Lender,
present fairly in all material respects the combined financial position of
Covalence or Berry, as applicable, as at such date and the combined results of
operations, shareholders’ equity and cash flows of Covalence or Berry, as
applicable, for the years then ended.
 

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SECTION 3.06. No Material Adverse Effect. Since December 30, 2006, there has
been no event, development or circumstance that has or would reasonably be
expected to have a Material Adverse Effect.
 
SECTION 3.07. Title to Properties; Possession Under Leases. xviii)  Each of
Holdings, the Borrowers and the Subsidiaries has valid fee simple title to, or
valid leasehold interests in, or easements or other limited property interests
in, all its Real Properties (including all Mortgaged Properties) and has valid
title to its personal property and assets, in each case, except for Permitted
Liens and except for defects in title that do not materially interfere with its
ability to conduct its business as currently conducted or to utilize such
properties and assets for their intended purposes and except where the failure
to have such title would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect. All such properties and assets are
free and clear of Liens, other than Permitted Liens.
 
(b) Each of the Borrowers and the Subsidiaries has complied with all obligations
under all leases to which it is a party, except where the failure to comply
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect, and all such leases are in full force and effect,
except leases in respect of which the failure to be in full force and effect
would not reasonably be expected to have a Material Adverse Effect. Except as
set forth on Schedule 3.07(b), each of the Borrowers and each of the
Subsidiaries enjoys peaceful and undisturbed possession under all such leases,
other than leases in respect of which the failure to enjoy peaceful and
undisturbed possession would not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect.
 
(c) As of the Closing Date, none of the Borrowers or the Subsidiaries has
received any notice of any pending or contemplated condemnation proceeding
affecting any material portion of the Mortgaged Properties or any sale or
disposition thereof in lieu of condemnation that remains unresolved as of the
Closing Date.
 
(d) None of the Borrowers or the Subsidiaries is obligated on the Closing Date
under any right of first refusal, option or other contractual right to sell,
assign or otherwise dispose of any Mortgaged Property or any interest therein,
except as permitted under Section 6.02 or 6.05.
 
SECTION 3.08. Subsidiaries. xix)  Schedule 3.08(a) sets forth as of the Closing
Date the name and jurisdiction of incorporation, formation or organization of
each subsidiary of Holdings and, as to each such subsidiary, the percentage of
each class of Equity Interests owned by Holdings or by any such subsidiary.
 
(b) As of the Closing Date, there are no outstanding subscriptions, options,
warrants, calls, rights or other agreements or commitments (other than stock
options and stock appreciation rights granted to employees or directors and
directors’ qualifying shares) of any nature relating to any Equity Interests of
Holdings, the Borrowers or any of the Subsidiaries, except rights of employees
to purchase Equity Interests of Holdings in connection with the Transactions or
as set forth on Schedule 3.08(b).
 

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SECTION 3.09. Litigation; Compliance with Laws. xx)  There are no actions, suits
or proceedings at law or in equity or, to the knowledge of the Borrowers,
investigations by or on behalf of any Governmental Authority or in arbitration
now pending, or, to the knowledge of Holdings or the Borrowers, threatened in
writing against or affecting Holdings or the Borrowers or any of the
Subsidiaries or any business, property or rights of any such person which would
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.
 
(b) None of Holdings, the Borrowers, the Subsidiaries and their respective
properties or assets is in violation of (nor will the continued operation of
their material properties and assets as currently conducted violate) any law,
rule or regulation (including any zoning, building, ordinance, code or approval
or any building permit, but excluding any Environmental Laws, which are subject
to Section 3.16) or any restriction of record or agreement affecting any
Mortgaged Property, or is in default with respect to any judgment, writ,
injunction or decree of any Governmental Authority, where such violation or
default would reasonably be expected to have, individually or in the aggregate,
a Material Adverse Effect.
 
SECTION 3.10. Federal Reserve Regulations. xxi)  None of Holdings, the Borrowers
or the Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying Margin Stock.
 
(b) No part of the proceeds of any Loan will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately, (i) to purchase
or carry Margin Stock or to extend credit to others for the purpose of
purchasing or carrying Margin Stock or to refund indebtedness originally
incurred for such purpose, or (ii) for any purpose that entails a violation of,
or that is inconsistent with, the provisions of the Regulations of the Board,
including Regulation U or Regulation X.
 
SECTION 3.11. Investment Company Act. None of Holdings, the Borrowers and the
Subsidiaries is an “investment company” as defined in, or subject to regulation
under, the Investment Company Act of 1940, as amended.
 
SECTION 3.12. Use of Proceeds. The Borrowers will use the proceeds of the
Revolving Loans, together with other cash, to consummate the Refinancing, for
general corporate purposes and to pay the Transaction Expenses.
 
SECTION 3.13. Tax Returns. Except as set forth on Schedule 3.13:
 
(a) Except as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect, (i) each of Holdings, the Borrowers
and the Subsidiaries has filed or caused to be filed all federal, state, local
and non-U.S. Tax returns required to have been filed by it and (ii) taken as a
whole, and each such Tax return is true and correct;
 
(b) Each of Holdings, the Borrowers and the Subsidiaries has timely paid or
caused to be timely paid all Taxes shown to be due and payable by it on the
returns referred to in clause (a) and all other Taxes or assessments (or made
adequate provision (in accordance with GAAP) for the payment of all Taxes due)
with respect to all periods
 

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or portions thereof ending on or before the Closing Date (except Taxes or
assessments that are being contested in good faith by appropriate proceedings in
accordance with Section 5.03 and for which Holdings, the Borrowers or any of the
Subsidiaries (as the case may be) has set aside on its books adequate reserves
in accordance with GAAP), which Taxes, if not paid or adequately provided for,
would, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; and
 
(c) Other than as would not be, individually or in the aggregate, reasonably
expected to have a Material Adverse Effect: as of the Closing Date, with respect
to each of Holdings, the Borrowers and the Subsidiaries, there are no claims
being asserted in writing with respect to any Taxes.
 
SECTION 3.14. No Material Misstatements. xxii)  All written information (other
than the Projections, estimates and information on Schedule 4.02 or estimates
and information of a general economic nature or general industry nature) (the
“Information”) concerning Holdings, the Borrowers, the Subsidiaries, the
Transactions and any other transactions contemplated hereby included in the
Information Memorandum or otherwise prepared by or on behalf of the foregoing or
their representatives and made available to any Lenders or the Administrative
Agent in connection with the Transactions or the other transactions contemplated
hereby, when taken as a whole, was true and correct in all material respects, as
of the date such Information was furnished to the Lenders and as of the Closing
Date and did not, taken as a whole, contain any untrue statement of a material
fact as of any such date or omit to state a material fact necessary in order to
make the statements contained therein, taken as a whole, not materially
misleading in light of the circumstances under which such statements were made.
 
(b) The Projections and estimates and information of a general economic nature
prepared by or on behalf of the Borrowers or any of their representatives and
that have been made available to any Lenders or the Administrative Agent in
connection with the Transactions or the other transactions contemplated hereby
(i) have been prepared in good faith based upon assumptions believed by the
Borrowers to be reasonable as of the date thereof (it being understood that
actual results may vary materially from the Projections), as of the date such
Projections and estimates were furnished to the Lenders and as of the Closing
Date, and (ii) as of the Closing Date, have not been modified in any material
respect by the Borrowers.
 
SECTION 3.15. Employee Benefit Plans. xxiii)  Except as would not reasonably be
expected, individually or in the aggregate, to have a Material Adverse Effect:
(i) each Plan is in compliance in all material respects with the applicable
provisions of ERISA and the Code; (ii) no Reportable Event has occurred during
the past five years as to which the Borrowers, Holdings, any of their
Subsidiaries or any ERISA Affiliate was required to file a report with the PBGC,
other than reports that have been filed; (iii) no Plan has any Unfunded Pension
Liability in excess of $50 million; (iv) no ERISA Event has occurred or is
reasonably expected to occur; and (v) none of the Borrowers, Holdings, the
Subsidiaries and the ERISA Affiliates (A) has received any written notification
that any Multiemployer Plan is in reorganization or has been terminated within
the meaning of Title IV of ERISA, or has knowledge that any Multiemployer Plan
is reasonably expected to be in reorganization or to be terminated or (B) has
incurred or is reasonably expected to incur any Withdrawal Liability to any
Multiemployer Plan.
 

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(b) Each of Holdings, the Borrowers and the Subsidiaries is in compliance (i)
with all applicable provisions of law and all applicable regulations and
published interpretations thereunder with respect to any employee pension
benefit plan or other employee benefit plan governed by the laws of a
jurisdiction other than the United States and (ii) with the terms of any such
plan, except, in each case, for such noncompliance that would not reasonably be
expected to have a Material Adverse Effect.
 
SECTION 3.16. Environmental Matters. Except as set forth in Schedule 3.16 and
except as to matters that would not reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect: (i) no written notice, request
for information, order, complaint or penalty has been received by the Borrowers
or any of their Subsidiaries, and there are no judicial, administrative or other
actions, suits or proceedings pending or, to such Borrower’s knowledge,
threatened which allege a violation of or liability under any Environmental
Laws, in each case relating to the Borrowers or any of their Subsidiaries, (ii)
each of the Borrowers and their Subsidiaries has all environmental permits,
licenses and other approvals necessary for its operations to comply with all
applicable Environmental Laws and is, and during the term of all applicable
statutes of limitation, has been, in compliance with the terms of such permits,
licenses and other approvals and with all other applicable Environmental Laws,
(iii) to the Borrowers’ knowledge, no Hazardous Material is located at, on or
under any property currently owned, operated or leased by the Borrowers or any
of their Subsidiaries that would reasonably be expected to give rise to any
cost, liability or obligation of the Borrowers or any of their Subsidiaries
under any Environmental Laws, and no Hazardous Material has been generated,
owned, treated, stored, handled or controlled by the Borrowers or any of their
Subsidiaries and transported to or Released at any location in a manner that
would reasonably be expected to give rise to any cost, liability or obligation
of the Borrowers or any of their Subsidiaries under any Environmental Laws, and
(iv) there are no agreements in which the Borrowers or any of their Subsidiaries
have expressly assumed or undertaken responsibility for any known or reasonably
likely liability or obligation of any other person arising under or relating to
Environmental Laws, which in any such case has not been made available to the
Administrative Agent prior to the date hereof.
 
SECTION 3.17. Security Documents. xxiv)  The Collateral Agreement is effective
to create in favor of the Collateral Agent (for the benefit of the Secured
Parties) a legal, valid and enforceable security interest in the Collateral
described therein and proceeds thereof. In the case of the Pledged Collateral
described in the Collateral Agreement, when certificates or promissory notes, as
applicable, representing such Pledged Collateral are delivered to the Collateral
Agent, and in the case of the other Collateral described in the Collateral
Agreement (other than the Intellectual Property (as defined in the Collateral
Agreement)), when financing statements and other filings specified in the
Perfection Certificate are filed in the offices specified in the Perfection
Certificate, the Collateral Agent (for the benefit of the Secured Parties) shall
have a fully perfected Lien on, and security interest in, all right, title and
interest of the Loan Parties in such Collateral and, subject to Section 9-315 of
the New York Uniform Commercial Code, the proceeds thereof, as security for the
Obligations to the extent perfection can be obtained by filing Uniform
Commercial Code financing statements, in each case prior and superior in right
to any other person (except Permitted Liens).
 

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(b) When the Collateral Agreement or a summary thereof is properly filed in the
United States Patent and Trademark Office and the United States Copyright
Office, and, with respect to Collateral in which a security interest cannot be
perfected by such filings, upon the proper filing of the financing statements
referred to in paragraph (a) above, the Collateral Agent (for the benefit of the
Secured Parties) shall have a fully perfected Lien on, and security interest in,
all right, title and interest of the Loan Parties thereunder in all domestic
Intellectual Property, in each case prior and superior in right to any other
person (it being understood that subsequent recordings in the United States
Patent and Trademark Office and the United States Copyright Office may be
necessary to perfect a lien on registered trademarks and patents, trademark and
patent applications and registered copyrights acquired by the grantors after the
Closing Date) (except Permitted Liens).
 
(c) Each Foreign Pledge Agreement, if any, shall be effective to create in favor
of the Collateral Agent, for the benefit of the Secured Parties, a legal, valid
and enforceable security interest in the Collateral described therein and
proceeds thereof to the fullest extent permissible under applicable law. In the
case of the Pledged Collateral described in a Foreign Pledge Agreement, when
certificates representing such Pledged Collateral (if any) are delivered to the
Collateral Agent, the Collateral Agent (for the benefit of the Secured Parties)
shall have a fully perfected Lien on, and security interest in, all right, title
and interest of the Loan Parties in such Collateral and the proceeds thereof, as
security for the Obligations, in each case prior and superior in right to any
other person.
 
(d) The Mortgages (if any) executed and delivered on or before the Closing Date
are, and the Mortgages to be executed and delivered after the Closing Date
pursuant to Section 5.10 shall be, effective to create in favor of the
Collateral Agent (for the benefit of the Secured Parties) a valid Lien on all of
the Loan Parties’ right, title and interest in and to the Mortgaged Property
thereunder and the proceeds thereof, and when such Mortgages are filed or
recorded in the proper real estate filing or recording offices, the Collateral
Agent (for the benefit of the Secured Parties) shall have a fully perfected Lien
on, and security interest in, all right, title and interest of the Loan Parties
in such Mortgaged Property and, to the extent applicable, subject to
Section 9-315 of the Uniform Commercial Code, the proceeds thereof, in each case
prior and superior in right to any other person, other than with respect to the
rights of a person pursuant to Permitted Liens.
 
(e) Notwithstanding anything herein (including this Section 3.17) or in any
other Loan Document to the contrary, other than to the extent set forth in the
applicable Foreign Pledge Agreements, no Borrower or any other Loan Party makes
any representation or warranty as to the effects of perfection or
non-perfection, the priority or the enforceability of any pledge of or security
interest in any Equity Interests of any Foreign Subsidiary that is not a Loan
Party, or as to the rights and remedies of the Agents or any Lender with respect
thereto, under foreign law.
 
SECTION 3.18. Location of Real Property and Leased Premises. xxv)  The
Perfection Certificate lists completely and correctly, in all material respects,
as of the Closing Date all material Real Property owned by Holdings, the
Borrowers and the Subsidiary Loan Parties and the addresses thereof. As of the
Closing Date, Holdings, the Borrowers and the Subsidiary Loan Parties own in fee
all the Real Property set forth as being owned by them on the Perfection
Certificate.
 

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(b) The Perfection Certificate lists completely and correctly in all material
respects, as of the Closing Date, all material real property leased by Holdings,
the Borrowers and the Subsidiary Loan Parties and the addresses thereof. As of
the Closing Date, Holdings, the Borrowers and the Subsidiary Loan Parties have
in all material respects valid leases in all the real property set forth as
being leased by them on the Perfection Certificate.
 
SECTION 3.19. Solvency. xxvi)  Immediately after giving effect to the
Transactions on the Closing Date, (i) the fair value of the assets of the
Company (individually) and Holdings, the Company and its Subsidiaries on a
consolidated basis, at a fair valuation, will exceed the debts and liabilities,
direct, subordinated, contingent or otherwise, of the Company (individually) and
Holdings, the Company and its Subsidiaries on a consolidated basis,
respectively; (ii) the present fair saleable value of the property of the
Company (individually) and Holdings, the Company and its Subsidiaries on a
consolidated basis will be greater than the amount that will be required to pay
the probable liability of the Company (individually) and Holdings, the Company
and its Subsidiaries on a consolidated basis, respectively, on their debts and
other liabilities, direct, subordinated, contingent or otherwise, as such debts
and other liabilities become absolute and matured; (iii) the Company
(individually) and Holdings, the Company and its Subsidiaries on a consolidated
basis will be able to pay their debts and liabilities, direct, subordinated,
contingent or otherwise, as such debts and liabilities become absolute and
matured; and (iv) the Company (individually) and Holdings, the Company and its
Subsidiaries on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted following the
Closing Date.
 
(b) On the Closing Date, neither Holdings nor any Borrower intends to, and
neither Holdings nor any Borrower believes that it or any of its subsidiaries
will, incur debts beyond its ability to pay such debts as they mature, taking
into account the timing and amounts of cash to be received by it or any such
subsidiary and the timing and amounts of cash to be payable on or in respect of
its Indebtedness or the Indebtedness of any such subsidiary.
 
SECTION 3.20. Labor Matters. Except as, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect: (a) there are no
strikes or other labor disputes pending or threatened against Holdings, the
Borrowers or any of the Subsidiaries; (b) the hours worked and payments made to
employees of Holdings, the Borrowers and the Subsidiaries have not been in
violation of the Fair Labor Standards Act or any other applicable law dealing
with such matters; and (c) all payments due from Holdings, the Borrowers or any
of the Subsidiaries or for which any claim may be made against Holdings, the
Borrowers or any of the Subsidiaries, on account of wages and employee health
and welfare insurance and other benefits have been paid or accrued as a
liability on the books of Holdings, the Borrowers or such Subsidiary to the
extent required by GAAP. Except as, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect, the consummation of
the Transactions will not give rise to a right of termination or right of
renegotiation on the part of any union under any material collective bargaining
agreement to which Holdings, the Borrowers or any of the Subsidiaries (or any
predecessor) is a party or by which Holdings, the Borrowers or any of the
Subsidiaries (or any predecessor) is bound.
 

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SECTION 3.21. Insurance. Schedule 3.21 sets forth a true, complete and correct
description of all material insurance maintained by or on behalf of Holdings,
the Borrowers or the Subsidiaries as of the Closing Date. As of such date, such
insurance is in full force and effect.
 
SECTION 3.22. No Default. No Default or Event of Default has occurred and is
continuing or would result from the consummation of the transactions
contemplated by this Agreement or any other Loan Document.
 
SECTION 3.23. Intellectual Property; Licenses, Etc. Except as would not
reasonably be expected to have a Material Adverse Effect and as set forth in
Schedule 3.23, (a) the Borrowers and each of their Subsidiaries own, or possess
the right to use, all of the patents, patent rights, trademarks, service marks,
trade names, copyrights and any and all applications or registrations for any of
the foregoing (collectively, “Intellectual Property Rights”) that are reasonably
necessary for the operation of their respective businesses, without conflict
with the rights of any other person, (b) to the best knowledge of the Borrowers,
no intellectual property right, proprietary right, product, process, method,
substance, part, or other material now employed, sold or offered by or
contemplated to be employed, sold or offered by the Borrowers or their
Subsidiaries infringes upon any rights held by any other person, and (c) no
claim or litigation regarding any of the foregoing is pending or, to the best
knowledge of the Borrowers, threatened.
 
SECTION 3.24. Senior Debt. The Obligations constitute “Senior Debt” (or the
equivalent thereof) and “Designated Senior Debt” (or the equivalent thereof)
under the Senior Subordinated Notes Indentures or any Permitted Refinancing
Indebtedness in respect of the Senior Subordinated Notes or such other
Indebtedness permitted to be incurred hereunder constituting subordinated
Indebtedness.
 
SECTION 3.25. Common Enterprise. The successful operation and condition of each
of the Loan Parties is enhanced by the continued successful performance of the
functions of the group of Loan Parties as a whole. Each of the Loan Parties
expects to derive benefit (and its board of directors or other governing body
has determined that it may reasonably be expected to derive benefit), directly
and indirectly, from successful operations of Holdings and each of the other
Loan Parties. Each Loan Party expects to derive benefit (and the boards of
directors or other governing body of each such Loan Party have determined that
it may reasonably be expected to derive benefit), directly and indirectly, from
the credit extended by the Lenders to the Loan Parties hereunder, both in their
separate capacities and as members of the group of companies. Each Loan Party
has determined that execution, delivery, and performance of this Agreement and
any other Loan Documents to be executed by such Loan Party are within its
corporate purpose, will be of direct and indirect benefit to such Loan Party,
and are in its best interest.
 

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ARTICLE IV
 

 
Conditions of Lending
 
The obligations of (a) the Lenders (including the Swingline Lender) to make
Loans and (b) any Issuing Bank to issue Letters of Credit or increase the stated
amounts of Letters of Credit hereunder (each, a “Credit Event”) are subject to
the satisfaction of the following conditions:
 
SECTION 4.01. All Credit Events. On the date of each Credit Event:
 
(a) The Administrative Agent shall have received, in the case of a Borrowing, a
Borrowing Request as required by Section 2.03 (or a Borrowing Request shall have
been deemed given in accordance with the last paragraph of Section 2.03) or, in
the case of the issuance of a Letter of Credit, the applicable Issuing Bank and
the Administrative Agent shall have received a notice requesting the issuance of
such Letter of Credit as required by Section 2.05(b).
 
(b) The representations and warranties set forth in the Loan Documents shall be
true and correct in all material respects as of such date (other than an
amendment, extension or renewal of a Letter of Credit without any increase in
the stated amount of such Letter of Credit), in each case, with the same effect
as though made on and as of such date, except to the extent such representations
and warranties expressly relate to an earlier date (in which case such
representations and warranties shall be true and correct in all material
respects as of such earlier date).
 
(c) In the case of each Credit Event that occurs after the Closing Date, at the
time of and immediately after such Credit Event, no Event of Default or Default
shall have occurred and be continuing or would result therefrom.
 
(d) Such Credit Event is permitted under the terms of all Material Indebtedness.
 
Each such Borrowing and each issuance, amendment, extension or renewal of a
Letter of Credit shall be deemed to constitute a representation and warranty by
the Borrowers on the date of such Borrowing, issuance, amendment, extension or
renewal as applicable, (i) as to the matters specified in paragraphs (b), (c)
and (d) of this Section 4.01, and (b) that the aggregate amount of the Revolving
Facility Credit Exposure for which any Borrower is the borrower (in the case of
Loans) or the account party (in the case of Letters of Credit) does not exceed
the portion of the Borrowing Base attributable to such Borrower’s Accounts and
Inventory.
 
SECTION 4.02. Effectiveness of Commitments. On the Closing Date:
 
(a) The Administrative Agent (or its counsel) shall have received from each
party hereto either (i) a counterpart of this Agreement signed on behalf of such
party or (ii) written evidence satisfactory to the Administrative Agent (which
may include telecopy transmission of a signed signature page of this Agreement)
that such party has signed a counterpart of this Agreement.
 

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(b) The Administrative Agent shall have received, on behalf of itself and the
Lenders and each Issuing Bank on the Closing Date, a favorable written opinion
of (i) Wachtell, Lipton, Rosen & Katz, special counsel for the Loan Parties, in
form and substance reasonably satisfactory to the Administrative Agent, (ii)
Jeff Thompson, in-house counsel for certain of the Loan Parties, in form and
substance reasonably satisfactory to the Administrative Agent, and (iii) Gail
Lehman, in-house counsel for certain of the Loan Parties, in form and substance
reasonably satisfactory to the Administrative Agent, in each case (A) dated the
Closing Date, (B) addressed to each Issuing Bank on the Closing Date, the
Administrative Agent and the Lenders and (C) in form and substance reasonably
satisfactory to the Administrative Agent and covering such other matters
relating to the Loan Documents as the Administrative Agent shall reasonably
request.
 
(c) The Administrative Agent shall have received in the case of each Loan Party
each of the items referred to in clauses (i), (ii), (iii), (iv) and (v) below:
 
(i) only if such document or item shall have changed since September 20, 2006 in
respect of Berry and any Loan Party that was a subsidiary of Berry Holdings
immediately prior to Closing Date, or May 18, 2006 in respect of Covalence
Holdings or any Loan Party that was a subsidiary of Covalence Holdings
immediately prior to the Closing Date, a copy of the certificate or articles of
incorporation, certificate of limited partnership or certificate of formation,
including all amendments thereto, of each Loan Party, (A) in the case of a
corporation, certified as of a recent date by the Secretary of State (or other
similar official) of the jurisdiction of its organization, and a certificate as
to the good standing (to the extent such concept or a similar concept exists
under the laws of such jurisdiction) of each such Loan Party as of a recent date
from such Secretary of State (or other similar official) or (B) in the case of a
partnership or limited liability company, certified by the Secretary or
Assistant Secretary of each such Loan Party;
 
(ii) a certificate of the Secretary or Assistant Secretary or similar officer of
each Loan Party dated the Closing Date and certifying
 
(A) (1) that attached thereto is a true and complete copy of the by-laws (or
partnership agreement, limited liability company agreement or other equivalent
governing documents) of such Loan Party as in effect on the Closing Date and at
all times since the date of the resolutions described in clause (B) below, or
(2) that the by-laws (or partnership agreement, limited liability company
agreement or other equivalent governing documents) of such Loan Party, as in
effect on the Closing Date, have not been modified, rescinded or amended since
September 20, 2006 in respect of Berry and any Loan Party that was a subsidiary
of Berry Holdings immediately prior to Closing Date, or May 18, 2006 in respect
of Covalence Holdings or any Loan Party that was a subsidiary of Covalence
Holdings immediately prior to the Closing Date,
 

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(B) that attached thereto is a true and complete copy of resolutions duly
adopted by the Board of Directors (or equivalent governing body) of such Loan
Party (or its managing general partner or managing member) authorizing the
execution, delivery and performance of the Loan Documents to which such person
is a party and, in the case of the Borrowers, the borrowings hereunder, and that
such resolutions have not been modified, rescinded or amended and are in full
force and effect on the Closing Date,
 
(C) that the certificate or articles of incorporation, certificate of limited
partnership or certificate of formation of such Loan Party has not been amended
since the date of the last amendment thereto disclosed pursuant to clause (i)
above,
 
(D) as to the incumbency and specimen signature of each officer executing any
Loan Document or any other document delivered in connection herewith on behalf
of such Loan Party, and
 
(E) as to the absence of any pending proceeding for the dissolution or
liquidation of such Loan Party or, to the knowledge of such person, threatening
the existence of such Loan Party;
 
(iii) a certificate of a director or another officer as to the incumbency and
specimen signature of the Secretary or Assistant Secretary or similar officer
executing the certificate pursuant to clause (ii) above;
 
(iv) a calculation of the Borrowing Base as of the Closing Date in the form of
Schedule 4.02 reasonably satisfactory to the Administrative Agent; and
 
(v) such other documents as the Administrative Agent, the Lenders and any
Issuing Bank on the Closing Date may reasonably request (including without
limitation, tax identification numbers and addresses).
 
(d) The elements of the Collateral and Guarantee Requirement required to be
satisfied on the Closing Date shall have been satisfied (other than in the case
of any security interest in the intended Collateral or any deliverable related
to the perfection of security interests in the intended Collateral (other than
any Collateral the security interest in which may be perfected by the filing of
a UCC financing statement or the delivery of stock certificates and the security
agreement giving rise to the security interest therein) that is not provided on
the Closing Date after the Company’s use of commercially reasonable efforts to
do so, which such security interest or deliverable shall be delivered within the
time periods specified with respect thereto in Schedule 4.02(d)), and the
Administrative Agent shall have received a completed Perfection Certificate,
dated the Closing Date and signed by a Responsible Officer of the Company,
together with all attachments contemplated thereby.
 
(e) The Business Combination shall have been consummated or shall be consummated
simultaneously with or immediately following the closing under this
 

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Agreement in accordance with the terms and conditions of the Business
Combination as set forth in the Merger Documents, without material amendment,
supplement, modification or waiver thereof which is materially adverse to the
Lenders without the prior written consent of the Joint Lead Arrangers.
 
(f) The Lenders shall have received the financial statements referred to in
Section 3.05.
 
(g) On the Closing Date, after giving effect to the Transactions and the other
transactions contemplated hereby, Holdings shall have outstanding no
Indebtedness and the Borrowers and the Subsidiaries shall have outstanding no
Indebtedness other than (i) the Loans and other extensions of credit under this
Agreement, (ii) the Senior Subordinated Notes, (iii) the Second Lien Notes, (iv)
the Term Loans, and (v) other Indebtedness permitted pursuant to Section 6.01.
 
(h) The Lenders shall have received a solvency certificate substantially in the
form of Exhibit B and signed by the Chief Financial Officer of the Company
confirming the solvency of the Company and its Subsidiaries on a consolidated
basis after giving effect to the Transactions on the Closing Date.
 
(i) The Agents shall have received all fees payable thereto or to any Lender on
or prior to the Closing Date and, to the extent invoiced, all other amounts due
and payable pursuant to the Loan Documents on or prior to the Closing Date,
including, to the extent invoiced, reimbursement or payment of all reasonable
out-of-pocket expenses (including reasonable fees, charges and disbursements of
Shearman & Sterling LLP and local counsel) required to be reimbursed or paid by
the Loan Parties hereunder or under any Loan Document.
 
(j) Each of (i) the Collateral Agreement, (ii) the Senior Lender Intercreditor
Agreement, (iii) Intercreditor Agreement and (iv) the Term Loan Credit Agreement
shall have been executed and delivered by the respective parties thereto and
shall have become effective, and the Administrative Agent shall have received
evidence satisfactory to it of such execution and delivery and effectiveness.
 
For purposes of determining compliance with the conditions specified in this
Section 4.02, each Lender shall be deemed to have consented to, approved or
accepted or to be satisfied with each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to
the Lenders unless an officer of the Administrative Agent responsible for the
transactions contemplated by the Loan Documents shall have received notice from
such Lender prior to the Closing Date specifying its objection thereto and such
Lender shall not have made available to the Administrative Agent such Lender’s
ratable portion of the initial Borrowing.
 
 
ARTICLE V
 
 

 
 
Affirmative Covenants
 
The Borrowers covenant and agree with each Lender that so long as this Agreement
shall remain in effect (other than in respect of contingent indemnification
obligations
 

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for which no claim has been made) and until the Commitments have been terminated
and the Obligations (including principal of and interest on each Loan, all Fees
and all other expenses or amounts payable under any Loan Document) shall have
been paid in full and all Letters of Credit and Bankers’ Acceptances have been
canceled or fully cash collateralized (in a manner reasonably acceptable to the
Administrative Agent and the Issuing Banks) or have expired and all amounts
drawn or paid thereunder have been reimbursed in full, unless the Required
Lenders shall otherwise consent in writing, the Borrowers will, and will cause
each of the Material Subsidiaries to:
 
SECTION 5.01. Existence; Businesses and Properties. (a) Do or cause to be done
all things necessary to preserve, renew and keep in full force and effect its
legal existence, except, in the case of a Subsidiary of the Company, where the
failure to do so would not reasonably be expected to have a Material Adverse
Effect, and except as otherwise expressly permitted under Section 6.05, and
except for the liquidation or dissolution of Subsidiaries if the assets of such
Subsidiaries to the extent they exceed estimated liabilities are acquired by the
Company or a Wholly Owned Subsidiary of the Company in such liquidation or
dissolution; provided, that Subsidiary Loan Parties may not be liquidated into
Subsidiaries that are not Loan Parties and Domestic Subsidiaries may not be
liquidated into Foreign Subsidiaries.
 
(b) Except where the failure to do so would not reasonably be expected to have a
Material Adverse Effect, do or cause to be done all things necessary to (i)
lawfully obtain, preserve, renew, extend and keep in full force and effect the
permits, franchises, authorizations, patents, trademarks, service marks, trade
names, copyrights, licenses and rights with respect thereto necessary to the
normal conduct of its business and (ii) at all times maintain and preserve all
property necessary to the normal conduct of its business and keep such property
in good repair, working order and condition and from time to time make, or cause
to be made, all needful and proper repairs, renewals, additions, improvements
and replacements thereto necessary in order that the business carried on in
connection therewith, if any, may be properly conducted at all times (in each
case except as expressly permitted by this Agreement).
 
SECTION 5.02. Insurance. xxvii)  Maintain, with financially sound and reputable
insurance companies, insurance in such amounts and against such risks as are
customarily maintained by similarly situated companies engaged in the same or
similar businesses operating in the same or similar locations and cause the
Administrative Agent to be listed as a co-loss payee on property and casualty
policies and as an additional insured on liability policies.
 
(b) With respect to any Mortgaged Properties, if at any time the area in which
the Premises (as defined in the Mortgages) are located is designated a “flood
hazard area” in any Flood Insurance Rate Map published by the Federal Emergency
Management Agency (or any successor agency), obtain flood insurance in such
reasonable total amount as the Administrative Agent may from time to time
reasonably require, and otherwise comply with the National Flood Insurance
Program as set forth in the Flood Disaster Protection Act of 1973, as it may be
amended from time to time.
 
(c) In connection with the covenants set forth in this Section 5.02, it is
understood and agreed that:
 

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(i) none of the Administrative Agent, the Issuing Banks, the Lenders, and their
respective agents or employees shall be liable for any loss or damage insured by
the insurance policies required to be maintained under this Section 5.02, it
being understood that (A) the Loan Parties shall look solely to their insurance
companies or any other parties other than the aforesaid parties for the recovery
of such loss or damage and (B) such insurance companies shall have no rights of
subrogation against the Administrative Agent, the Lenders, any Issuing Bank or
their agents or employees. If, however, the insurance policies, as a matter of
the internal policy of such insurer, do not provide waiver of subrogation rights
against such parties, as required above, then each of Holdings and the
Borrowers, on behalf of itself and behalf of each of its subsidiaries, hereby
agrees, to the extent permitted by law, to waive, and further agrees to cause
each of their Subsidiaries to waive, its right of recovery, if any, against the
Administrative Agent, the Lenders, any Issuing Bank and their agents and
employees; and
 
(ii) the designation of any form, type or amount of insurance coverage by the
Administrative Agent under this Section 5.02 shall in no event be deemed a
representation, warranty or advice by the Administrative Agent or the Lenders
that such insurance is adequate for the purposes of the business of Holdings,
the Borrowers and the Subsidiaries or the protection of their properties.
 
SECTION 5.03. Taxes. Pay and discharge promptly when due all material Taxes,
imposed upon it or upon its income or profits or in respect of its property,
before the same shall become delinquent or in default, as well as all lawful
claims which, if unpaid, might give rise to a Lien upon such properties or any
part thereof; provided, however, that such payment and discharge shall not be
required with respect to any such Tax or claim so long as the validity or amount
thereof shall be contested in good faith by appropriate proceedings, and
Holdings, the Company or the affected Subsidiary, as applicable, shall have set
aside on its books reserves in accordance with GAAP with respect thereto.
 
SECTION 5.04. Financial Statements, Reports, etc. Furnish to the Administrative
Agent (which will promptly furnish such information to the Lenders):
 
(a) within 90 days (or, if applicable, such shorter period as the SEC shall
specify for the filing of annual reports on Form 10-K) after the end of each
fiscal year, a consolidated balance sheet and related statements of operations,
cash flows and owners’ equity showing the financial position of the Company and
its Subsidiaries as of the close of such fiscal year and the consolidated
results of its operations during such year and, beginning with the financials
delivered pursuant to this clause (a) in respect of the 2008 fiscal year,
setting forth in comparative form the corresponding figures for the prior fiscal
year, which consolidated balance sheet and related statements of operations,
cash flows and owners’ equity shall be audited by independent public accountants
of recognized national standing and accompanied by an opinion of such
accountants (which opinion shall not be qualified as to scope of audit or as to
the status of the Company or any Material Subsidiary as a going concern) to the
effect that such consolidated financial statements fairly present, in all
material respects, the financial position and results of operations of the
Company and its Subsidiaries on a consolidated basis in accordance with GAAP (it
being understood that the delivery by the Company of annual reports on Form 10-K
of the Company and its consolidated Subsidiaries shall satisfy the
 

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requirements of this Section 5.04(a) to the extent such annual reports include
the information specified herein);
 
(b) within 45 days (or, if applicable, such shorter period as the SEC shall
specify for the filing of quarterly reports on Form 10-Q) after the end of each
of the first three fiscal quarters of each fiscal year beginning with the fiscal
quarter ending June 30, 2007, for each of the first three fiscal quarters of
each fiscal year, (i) a consolidated balance sheet and related statements of
operations and cash flows showing the financial position of the Company and its
Subsidiaries as of the close of such fiscal quarter and the consolidated results
of its operations during such fiscal quarter and the then-elapsed portion of the
fiscal year and setting forth in comparative form the corresponding figures for
the corresponding periods of the prior fiscal year, and (ii) management’s
discussion and analysis of significant operational and financial developments
during such quarterly period, all of which shall be in reasonable detail and
which consolidated balance sheet and related statements of operations and cash
flows shall be certified by a Financial Officer of the Company on behalf of the
Company as fairly presenting, in all material respects, the financial position
and results of operations of the Company and its Subsidiaries on a consolidated
basis in accordance with GAAP (subject to normal year-end audit adjustments and
the absence of footnotes) (it being understood that the delivery by the Company
of quarterly reports on Form 10-Q of the Company and its consolidated
Subsidiaries shall satisfy the requirements of this Section 5.04(b) to the
extent such quarterly reports include the information specified herein);
 
(c) (x) concurrently with any delivery of financial statements under paragraphs
(a) or (b) above, a certificate of a Financial Officer of the Company certifying
(i) that no Event of Default or Default has occurred or, if such an Event of
Default or Default has occurred, specifying the nature and extent thereof and
any corrective action taken or proposed to be taken with respect thereto, (ii)
whether an Availability Triggering Event has occurred during the applicable
period covered by such financial statements, (iii) the calculation of the ABL
Fixed Charge Coverage Ratio as of the last day of the applicable period covered
by such financial statements, and (iv) that the aggregate amount of the
Revolving Facility Credit Exposure for which any Borrower is the borrower (in
the case of Loans) or the account party (in the case of Letters of Credit) does
not exceed the portion of the Borrowing Base attributable to such Borrower’s
Accounts and Inventory, together with, if requested by the Administrative Agent,
calculations evidencing and supporting such certification, (v) the calculation
and uses of the Cumulative Credit for the fiscal period then ended if the
Company shall have used the Cumulative Credit for any purpose during such fiscal
period, (vi) a list of names of all Immaterial Subsidiaries for the following
fiscal quarter, that each Subsidiary set forth on such list individually
qualifies as an Immaterial Subsidiary and that all such Subsidiaries in the
aggregate (together with all Unrestricted Subsidiaries) do not exceed the
limitation set forth in clause (b) of the definition of the term Immaterial
Subsidiary, and (vii) a list of names of all Unrestricted Subsidiaries, that
each Subsidiary set forth on such list individually qualifies as an Unrestricted
Subsidiary, and (y) concurrently with any delivery of financial statements under
paragraph (a) above, if the accounting firm is not restricted from providing
such a certificate by its policies of its national office, a certificate of the
accounting firm opining on or certifying such statements stating whether
 

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they obtained knowledge during the course of their examination of such
statements of any Default or Event of Default (which certificate may be limited
to accounting matters and disclaim responsibility for legal interpretations);
 
(d) promptly after the same become publicly available, copies of all periodic
and other publicly available reports, proxy statements and, to the extent
requested by the Administrative Agent, other materials filed by Holdings, the
Company or any of the Subsidiaries with the SEC, or after an initial public
offering, distributed to its stockholders generally, as applicable; provided,
however, that such reports, proxy statements, filings and other materials
required to be delivered pursuant to this clause (d) shall be deemed delivered
for purposes of this Agreement when posted to the website of the Company;
 
(e) within 90 days after the beginning of each fiscal year, a reasonably
detailed consolidated quarterly budget for such fiscal year (including a
projected consolidated balance sheet of the Company and its Subsidiaries as of
the end of the following fiscal year, and the related consolidated statements of
projected cash flow and projected income), including a description of underlying
assumptions with respect thereto (collectively, the “Budget”), which Budget
shall in each case be accompanied by the statement of a Financial Officer of the
Company to the effect that the Budget is based on assumptions believed by such
Financial Officer to be reasonable as of the date of delivery thereof;
 
(f) upon the reasonable request of the Administrative Agent, an updated
Perfection Certificate (or, to the extent such request relates to specified
information contained in the Perfection Certificate, such information)
reflecting all changes since the date of the information most recently received
pursuant to this paragraph (f) or Section 5.10(g);
 
(g) promptly, from time to time, such other information regarding the
operations, business affairs and financial condition of Holdings, the Company or
any of the Subsidiaries, or compliance with the terms of any Loan Document, or
such consolidating financial statements as in each case the Administrative Agent
may reasonably request (for itself or on behalf of any Lender);
 
(h) in the event that (i) in respect of the Second Lien Notes or the Senior
Subordinated Notes, and any Refinancing Indebtedness with respect thereto, the
rules and regulations of the SEC permit the Company, Holdings or any Parent
Entity to report at Holdings’ or such Parent Entity’s level on a consolidated
basis and (ii) Holdings or such Parent Entity, as the case may be, is not
engaged in any business or activity, and does not own any assets or have other
liabilities, other than those incidental to its ownership directly or indirectly
of the capital stock of the Company and the incurrence of Indebtedness for
borrowed money (and, without limitation on the foregoing, does not have any
subsidiaries other than the Company and the Company’s Subsidiaries and any
direct or indirect parent companies of the Company that are not engaged in any
other business or activity and do not hold any other assets or have any
liabilities except as indicated above) such consolidated reporting at such
Parent Entity’s level in a manner
 

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consistent with that described in paragraphs (a) and (b) of this Section 5.04
for the Company (together with a reconciliation showing the adjustments
necessary to determine the ABL Fixed Charge Coverage Ratio) will satisfy the
requirements of such paragraphs;
 
(i) promptly upon request by the Administrative Agent, copies of: (i) each
Schedule B (Actuarial Information) to the most recent annual report (Form 5500
Series) filed with the Internal Revenue Service with respect to a Plan; (ii) the
most recent actuarial valuation report for any Plan; (iii) all notices received
from a Multiemployer Plan sponsor, a plan administrator or any governmental
agency, or provided to any Multiemployer Plan by Holdings, the Company, a
Subsidiary or any ERISA Affiliate, concerning an ERISA Event; and (iv) such
other documents or governmental reports or filings relating to any Plan or
Multiemployer Plan as the Administrative Agent shall reasonably request; and
 
(j) promptly upon Holdings, the Company or the Subsidiaries becoming aware of
any fact or condition which would reasonably be expected to result in an ERISA
Event, the Company shall deliver to Administrative Agent a summary of such facts
and circumstances and any action it or Holdings or the Subsidiaries intend to
take regarding such facts or conditions.
 
SECTION 5.05. Litigation and Other Notices. Furnish to the Administrative Agent
(which will promptly thereafter furnish to the Lenders) written notice of the
following promptly after any Responsible Officer of Holdings or the Company
obtains actual knowledge thereof:
 
(a) any Event of Default or Default, specifying the nature and extent thereof
and the corrective action (if any) proposed to be taken with respect thereto;
 
(a) the filing or commencement of, or any written threat or notice of intention
of any person to file or commence, any action, suit or proceeding, whether at
law or in equity or by or before any Governmental Authority or in arbitration,
against Holdings, the Company or any of the Subsidiaries as to which an adverse
determination is reasonably probable and which, if adversely determined, would
reasonably be expected to have a Material Adverse Effect;
 
(b) any other development specific to Holdings, the Company or any of the
Subsidiaries that is not a matter of general public knowledge and that has had,
or would reasonably be expected to have, a Material Adverse Effect; and
 
(c) the development of any ERISA Event that, together with all other ERISA
Events that have developed or occurred, would reasonably be expected to have a
Material Adverse Effect.
 
SECTION 5.06. Compliance with Laws. Comply with all laws, rules, regulations and
orders of any Governmental Authority applicable to it or its property, except
where the failure to do so, individually or in the aggregate, would not
reasonably be expected to result in a Material Adverse Effect; provided, that
this Section 5.06 shall not apply to Environmental Laws,
 

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which are the subject of Section 5.09, or to laws related to Taxes, which are
the subject of Section 5.03.
 
SECTION 5.07. Maintaining Records; Access to Properties and Inspections.
Maintain all financial records in accordance with GAAP and, upon five Business
Days’ notice (or, if an Event of Default has occurred and is continuing, one
Business Day’s notice), permit any authorized representatives of the
Administrative Agent and the Collateral Agent to visit, audit and inspect any of
the properties of such Borrower and its Subsidiaries, including its and their
financial and accounting records, and to make copies and take extracts
therefrom, and to discuss its and their affairs, finances and business with its
and their officers and certified public accountants (so long as such Borrower
has the opportunity to participate in any discussions with such certified public
accountants), at such reasonable times during normal business hours and without
undue disruption to the business of the Borrowers as often as may be reasonably
requested, in each case at the expense of the Borrowers (a “Collateral Audit”);
provided, that so long as no Availability Triggering Event or Event of Default
has occurred and is continuing, the Administrative Agent shall not conduct more
than one Collateral Audit per year unless the Availability is less than $100
million for five consecutive days, in which case two Collateral Audits per year
shall be permitted. If an Availability Triggering Event or Event of Default has
occurred and is continuing, representatives of each Lender (at such Lender’s
expense) will be permitted to accompany representatives of the Administrative
Agent during each visit, inspection and discussion conducted during the
existence of such Availability Triggering Event or Event of Default.
 
SECTION 5.08. Use of Proceeds. Use the proceeds of the Revolving Loans and the
Swingline Loans and request the issuance of Letters of Credit, together with
other cash, to consummate the Refinancing and the other Transactions and for
general corporate purposes.
 
SECTION 5.09. Compliance with Environmental Laws. Comply, and make reasonable
efforts to cause all lessees and other persons occupying its properties to
comply, with all Environmental Laws applicable to its operations and properties;
and obtain and renew all material authorizations and permits required pursuant
to Environmental Law for its operations and properties, in each case in
accordance with Environmental Laws, except, in each case with respect to this
Section 5.09, to the extent the failure to do so would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.
 
SECTION 5.10. Further Assurances; Additional Security. xxviii)  Execute any and
all further documents, financing statements, agreements and instruments, and
take all such further actions (including the filing and recording of financing
statements, fixture filings, Mortgages and other documents and recordings of
Liens in stock registries), that may be required under any applicable law, or
that the Collateral Agent may reasonably request, to satisfy the Collateral and
Guarantee Requirement and to cause the Collateral and Guarantee Requirement to
be and remain satisfied, all at the expense of the Loan Parties and provide to
the Collateral Agent, from time to time upon reasonable request, evidence
reasonably satisfactory to the Collateral Agent as to the perfection and
priority of the Liens created or intended to be created by the Security
Documents.
 

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(b) If any asset (including any Real Property (other than Real Property covered
by paragraph (c) below) or improvements thereto or any interest therein) that
has an individual fair market value in an amount greater than $5 million is
acquired by the Company or any other Loan Party after the Closing Date or owned
by an entity at the time it becomes a Subsidiary Loan Party (in each case other
than (x) assets constituting Collateral under a Security Document that become
subject to the Lien of such Security Document upon acquisition thereof and (y)
assets that are not required to become subject to Liens in favor of the
Collateral Agent pursuant to Section 5.10(g) or the Security Documents) (i)
notify the Collateral Agent thereof, (ii) if such asset is comprised of Real
Property, deliver to Collateral Agent an updated Schedule 1.01(c) reflecting the
addition of such asset, and (iii) cause such asset to be subjected to a Lien
securing the Obligations and take, and cause the Subsidiary Loan Parties to
take, such actions as shall be necessary or reasonably requested by the
Administrative Agent to grant and perfect such Liens, including actions
described in paragraph (a) of this Section, all at the expense of the Loan
Parties, subject to paragraph (g) below.
 
(c) Promptly notify the Collateral Agent of the acquisition of and grant and
cause each of the Subsidiary Loan Parties to grant to the Collateral Agent
security interests and mortgages in such Real Property of the Company or any
such Subsidiary Loan Parties as are not covered by the original Mortgages, to
the extent acquired after the Closing Date and having a value at the time of
acquisition in excess of $5 million pursuant to documentation substantially in
the form of the Mortgages delivered to the Collateral Agent on the Closing Date
or in such other form as is reasonably satisfactory to the Administrative Agent
(each, an “Additional Mortgage”) and constituting valid and enforceable Liens
subject to no other Liens except Permitted Liens, at the time of perfection
thereof, record or file, and cause each such Subsidiary to record or file, the
Additional Mortgage or instruments related thereto in such manner and in such
places as is required by law to establish, perfect, preserve and protect the
Liens in favor of the Collateral Agent required to be granted pursuant to the
Additional Mortgages and pay, and cause each such Subsidiary to pay, in full,
all Taxes, fees and other charges payable in connection therewith, in each case
subject to paragraph (g) below. Unless otherwise waived by the Collateral Agent,
with respect to each such Additional Mortgage, the Company shall deliver to the
Collateral Agent contemporaneously therewith a title insurance policy, and a
survey.
 
(d) If any additional direct or indirect Subsidiary of the Company is formed or
acquired after the Closing Date (with any Subsidiary Redesignation resulting in
an Unrestricted Subsidiary becoming a Subsidiary being deemed to constitute the
acquisition of a Subsidiary) and if such Subsidiary is a Subsidiary Loan Party,
within five Business Days after the date such Subsidiary is formed or acquired,
notify the Collateral Agent and the Lenders thereof and, within 20 Business Days
after the date such Subsidiary is formed or acquired or such longer period as
the Collateral Agent shall agree, cause the Collateral and Guarantee Requirement
to be satisfied with respect to such Subsidiary and with respect to any Equity
Interest in or Indebtedness of such Subsidiary owned by or on behalf of any Loan
Party, subject to paragraph (g) below.
 
(e) If any additional Foreign Subsidiary of the Company is formed or acquired
after the Closing Date (with any Subsidiary Redesignation resulting in an
Unrestricted Subsidiary becoming a Subsidiary being deemed to constitute the
acquisition of a Subsidiary) and if such Subsidiary is a “first tier” Foreign
Subsidiary, within five Business Days after the date such Foreign Subsidiary is
formed or acquired, notify the Collateral Agent and the Lenders
 

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thereof and, within 20 Business Days after the date such Foreign Subsidiary is
formed or acquired or such longer period as the Collateral Agent shall agree,
cause the Collateral and Guarantee Requirement to be satisfied with respect to
any Equity Interest in such Foreign Subsidiary owned by or on behalf of any Loan
Party, subject to paragraph (g) below.
 
(f) (i) Furnish to the Collateral Agent prompt written notice of any change (A)
in any Loan Party’s corporate or organization name, (B) in any Loan Party’s
identity or organizational structure or (C) in any Loan Party’s organizational
identification number; provided, that the Borrowers shall not effect or permit
any such change unless all filings have been made, or will have been made within
any statutory period, under the Uniform Commercial Code or otherwise that are
required in order for the Collateral Agent to continue at all times following
such change to have a valid, legal and perfected security interest in all the
Collateral for the benefit of the Secured Parties and (ii) promptly notify the
Administrative Agent if any material portion of the Collateral is damaged or
destroyed.
 
(g) The Collateral and Guarantee Requirement and the other provisions of this
Section 5.10 need not be satisfied with respect to (i) any Real Property held by
the Borrowers or any of their Subsidiaries as a lessee under a lease, (ii) any
vehicle, (iii) except as required pursuant to Section 5.15, cash, deposit
account and security accounts (provided that this clause (iii) shall not affect
the Collateral Agent’s right to claim a security interest in proceeds of
Accounts and Inventory), (iv) any Equity Interests acquired after the Closing
Date (other than Equity Interests in the Company or, in the case of any person
which is a Subsidiary, Equity Interests in such person issued or acquired after
such person became a Subsidiary) in accordance with this Agreement if, and to
the extent that, and for so long as (A) such Equity Interests constitute less
than 100% of all applicable Equity Interests of such person and the person
holding the remainder of such Equity Interests are not Affiliates, (B) doing so
would violate applicable law or a contractual obligation binding on such Equity
Interests and (C) with respect to such contractual obligations, such obligation
existed at the time of the acquisition thereof and was not created or made
binding on such Equity Interests in contemplation of or in connection with the
acquisition of such Subsidiary, (v) any assets acquired after the Closing Date,
to the extent that, and for so long as, taking such actions would violate an
enforceable contractual obligation binding on such assets that existed at the
time of the acquisition thereof and was not created or made binding on such
assets in contemplation or in connection with the acquisition of such assets
(except in the case of assets acquired with Indebtedness permitted pursuant to
Section 6.01(i) that is secured by a Permitted Lien) or (vi) those assets as to
which the Collateral Agent shall reasonably determine that the costs of
obtaining or perfecting such a security interest are excessive in relation to
the value of the security to be afforded thereby; provided, that, upon the
reasonable request of the Collateral Agent, the Company shall, and shall cause
any applicable Subsidiary to, use commercially reasonable efforts to have waived
or eliminated any contractual obligation of the types described in clauses (iv)
and (v) above.
 
SECTION 5.11. [Intentionally Omitted.]
 
SECTION 5.12. Appraisals and Reports. The Company shall use commercially
reasonable efforts to facilitate the completion of Post-Closing Reports within
90 days after the Closing Date. In addition, the Borrowers shall provide to the
Collateral Agent, upon request of the Collateral Agent and at the expense of the
Borrowers, (a) so long as no Availability
 

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Triggering Event or Event of Default has occurred and is continuing, one time in
each calendar year (in coordination with the Company’s annual financial
statement audit), or (b) if the Availability is less than $100 million for five
consecutive days, two times per calendar year, and (c) if any Availability
Triggering Event or Event of Default has occurred and is continuing, one
additional time during any calendar year, appraisals or updates thereof of any
or all of the Collateral from one or more Acceptable Appraisers (as selected by
the Borrowers), and prepared in a form and on a basis reasonably satisfactory to
the Collateral Agent, such appraisals and updates to include, without
limitation, information required by Requirements of Law and by the internal
policies of the Lenders. In addition, the Borrowers shall have the right (but
not the obligation), at their expense, at any time and from time to time (but
not more than twice per year) to provide the Collateral Agent with additional
appraisals or updates thereof of any or all of the Collateral from one or more
Acceptable Appraisers (as selected by the Borrowers), and prepared in a form and
on a basis reasonably satisfactory to the Collateral Agent, in which case such
appraisals or updates shall be used in connection with the determination of the
Orderly Liquidation Value and the calculation of the Borrowing Base hereunder.
In connection with any appraisal requested by the Collateral Agent pursuant to
this Section 5.12, the Borrowers shall be given 20 days following such request
by the Collateral Agent to choose and engage the Acceptable Appraiser prior to
the commencement of such appraisal. With respect to each appraisal made pursuant
to this Section 5.12 after the Closing Date, (i) the Collateral Agent and the
Borrowers shall each be given a reasonable amount of time to review and comment
on a draft form of the appraisal prior to its finalization and (ii) any
adjustments to the Orderly Liquidation Value or the Borrowing Base hereunder as
a result of such appraisal shall become effective 20 days following the
finalization of such appraisal.
 
SECTION 5.13. Collateral Reporting. Provide, or cause to be provided, to the
Collateral Agent, a Borrowing Base Certificate on or before the 20th Business
Day of each Fiscal Period, or, during the continuance of an Availability
Triggering Event or Event of Default, more frequently if requested by the
Collateral Agent (but in no event more frequently than once in any seven
consecutive days), for the preceding Fiscal Period end (or such shorter period
during the continuance of an Availability Triggering Event or Event of Default),
substantially in the form of Exhibit F. If the Borrowers’ records or reports of
the Collateral required to be delivered pursuant to this Agreement are prepared
by an accounting service or other agent, the Borrowers hereby authorize such
service or agent to deliver such records or reports to the Collateral Agent, for
distribution to the Lenders.
 
SECTION 5.14. Accounts.
 
(a) Not re-date any invoice or sale or make sales on extended dating or extend
or modify any Account outside the ordinary course of business.
 
(b) Not, without the Collateral Agent’s prior written consent, accept any note
or other instrument (except a check or other instrument for the immediate
payment of money) with respect to any Account other than Accounts which (i) do
not exceed $1 million individually and (ii) at the time of accepting such note
or other instrument are not less than 90 days past due from the date of the
original invoice therefor or in settlement of a bankrupt or disputed account. If
the Collateral Agent consents to the acceptance of any such instrument, such
Loan Party will
 

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promptly deliver such instrument to the Collateral Agent, endorsed to the
Collateral Agent in a manner satisfactory in form and substance to the
Collateral Agent.
 
(c) Take commercially reasonable steps to settle, contest, or adjust any dispute
or claim in excess of $1 million at no expense to the Secured Parties. No
discount, credit, or allowance shall be granted to any Account Debtor without
the Collateral Agent’s prior written consent, except for discounts, credits, and
allowances made or given in the ordinary course of business of the Borrowers
(unless an Event of Default has occurred and is continuing and the Collateral
Agent has notified the Borrowers that such exception is withdrawn).
 
(d) If an Account Debtor returns any Inventory to any Borrower then, unless an
Event of Default exists and the Collateral Agent has given notice to the
Borrowers not to do so, such Borrower shall promptly determine the reason for
such return and if such return has a valid reason shall issue a credit
memorandum to the Account Debtor in the appropriate amount. All returned
Inventory of the Borrowers or its Subsidiaries shall be subject to the
Collateral Agent’s Liens thereon. Whenever any Inventory is returned, the
related Account shall be deemed ineligible (without duplication of any other
exclusion) to the extent of the amount owing by the Account Debtor with respect
to such returned Inventory.
 
SECTION 5.15. Collection of Accounts; Payments.
 
(a) Within 120 days after the Closing Date, establish a Payment Account (the
“Primary Payment Account”) subject to a Blocked Account Agreement and other
documentation reasonably acceptable to the Administrative Agent, into which all
Account collections and proceeds of Revolving Facility Senior Collateral (as
defined in the Senior Lender Intercreditor Agreement) will be deposited, and the
Borrowers hereby agree that, if an Availability Triggering Event or Specified
Default has occurred and is continuing, the Collateral Agent will have exclusive
dominion and control over the Primary Payment Account. In the absence of an
Availability Triggering Event or Specified Default, the Borrowers will be
entitled to direct the application of funds in the Primary Payment Account,
including directing the Administrative Agent (or other depository bank, if
applicable) to apply funds to the repayment of the outstanding Loans and other
amounts payable under the Loan Documents and to otherwise withdraw funds from
the Primary Payment Account; provided that all funds withdrawn from the Primary
Payment Account will be applied to repay operating expenses of the Borrowers and
their Subsidiaries in the ordinary course of business or for other purposes
permitted hereunder other than transfers of funds to a deposit account that is
not subject to a Blocked Account Agreement (an “Unblocked Account”) or
investments in Permitted Investments unless (i) the Collateral Agent has a first
priority perfected security interest in such Permitted Investment or Unblocked
Account or (ii) the amount of such Permitted Investments and funds in Unblocked
Accounts so transferred for which the Collateral Agent does not have a first
priority perfected security interest does not exceed $40 million at any one
time; provided that no such transfers of funds to Unblocked Accounts or
Permitted Investments may be made pursuant to this clause (ii) if the
Availability is less than $100 million on such date immediately before and after
giving effect to such transfer or Permitted Investment. If an Availability
Triggering Event or Specified Default has occurred and is continuing, (i) the
Collateral Agent shall have the right to apply collections received into the
Primary Payment Account to the outstanding Loans as provided in Section 5.02 of
the Collateral Agreement and the Borrowers shall have the right, subject to the
terms and
 

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conditions of this Agreement, to request Borrowings hereunder and direct the
disposition of Revolving Loan proceeds, and (ii) the Borrowers shall not be
entitled to present items drawn on or otherwise to withdraw or direct the
dispositions of funds from the Primary Payment Account nor shall any Borrower be
entitled to close the Primary Payment Account until all obligations under this
Agreement are paid and performed in full. Notwithstanding any other agreements
the Borrowers may have with any Secured Party, the Collateral Agent shall be
entitled, during the continuance of any Event of Default, for purposes of this
Agreement to give instructions as to the withdrawal or disposition of funds from
time to time credited to any deposit account with the Collateral Agent, any
Payment Account, or the Primary Payment Account, or as to any other matters
relating to any of the forgoing without further consent of the Borrowers. The
Collateral Agent’s power under this Agreement to give instructions as to the
withdrawal or disposition of any funds from time to time credited to the Primary
Payment Account, any other Payment Account or deposit account with the
Collateral Agent or as to any other matters relating to the foregoing includes,
without limitation, during an Event of Default, the power to give stop payment
orders for any items being presented to such accounts for payment. 
 
(b) No later than 120 days after the Closing Date or such later time as the
Administrative Agent shall agree, establish a lock-box service for collections
of Accounts at Clearing Banks reasonably acceptable to the Administrative Agent
and, with respect to bank accounts with Clearing Banks other than the Collateral
Agent, if requested by the Administrative Agent, subject to Blocked Account
Agreements and other documentation reasonably acceptable to the Administrative
Agent (provided that Blocked Account Agreements and other documentation
consistent in form and substance with the Blocked Account Agreements and
documentation established in connection with the Existing Credit Agreement shall
be acceptable to the Administrative Agent). The Borrowers shall instruct all
Account Debtors with respect to Accounts to make all payments directly to the
address established for each such lock-box service or electronically into such
lockbox accounts. If, notwithstanding such instructions, any Borrower receives
any proceeds of Accounts, it shall deliver such payments to the Collateral Agent
or deposit them into the Primary Payment Account of another Payment Account
established pursuant to this Section 5.15(b). All funds received in any Payment
Account other than the Primary Payment Account shall be promptly transferred to
the Primary Payment Account. During an Availability Triggering Event or
Specified Default, all collections received in any lock-box or Payment Account
or directly by the Borrowers or the Collateral Agent, and all funds in any
Payment Account or other account to which such collections are deposited, shall
be subject to the Collateral Agent’s exclusive dominion and control and
withdrawals by the Borrowers shall not be permitted; provided, however, that, in
the absence of an Availability Triggering Event or Specified Default, all
collections received in any lock-box or Payment Account, and all funds in any
Payment Account or other account to which such collections are deposited shall
be subject to direction as to application thereof and withdrawal by the
Borrowers in the same manner as provided in Section 5.15(a) for the Primary
Payment Account. The Collateral Agent or its designee may, at any time after the
occurrence and during the continuation of an Event of Default, upon notice to
the Borrowers, notify Account Debtors that the Accounts have been assigned to
the Collateral Agent and of the Collateral Agent’s security interest therein,
and may collect them directly and charge the collection costs and expenses to
the Loan Account as a Revolving Loan. So long as an Event of Default exists, the
Borrowers, at the Collateral Agent’s request, shall execute and deliver to the
Collateral Agent such documents as
 

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the Collateral Agent shall reasonably request to grant the Collateral Agent
access to any post office box in which collections of Accounts are received.
 
(c) If sales of Inventory are made or services are rendered by any of the
Borrowers for cash, such Borrowers shall promptly deposit such cash into a
Payment Account.
 
(d) Except as otherwise provided in this Section 5.15, all payments received by
the Collateral Agent in a bank account, an account separate from the Primary
Payment Account, a Payment Account or a lock-box account, designated by the
Borrowers and the Collateral Agent will be credited to the Loan Account
(conditional upon final collection) on the same day received (if received prior
to 3:00 p.m., Local Time); provided that the Borrowers shall compensate the
Collateral Agent for the cost of collection and clearance of remittances applied
to the Loan Account, including interest for one day, on all uncollected funds
credited to the Loan Account as provided by this Section 5.15(d).
 
(e) In the event all of the Obligations (other than contingent indemnification
and expense reimbursement obligations for which no claim has been made) are
repaid upon the termination of this Agreement or upon acceleration of the
Obligations, other than through the Collateral Agent’s receipt of payments on
account of the Accounts or proceeds of the other Collateral, such payment will
be credited (conditional upon final collection) to the Loan Account (i) on the
date of the Collateral Agent’s receipt of such funds if such funds are collected
funds or other immediately available funds if received by 3:00 p.m. (New York,
New York time) or (ii) one Business Day after the Collateral Agent’s receipt of
such funds if such funds are uncollected funds or collected or immediately
available funds received after such time.
 
SECTION 5.16. Inventory; Perpetual Inventory.
 
(a) Keep its Inventory (other than returned or obsolete Inventory) in good and
marketable condition, except for damaged or defective goods arising in the
ordinary course of its business. The Borrowers will not, without the prior
written consent of the Collateral Agent, acquire or maintain any Inventory in
excess of $5 million at any time on consignment or approval unless such
Inventory is disclosed to the Collateral Agent pursuant to Section 5.13 and the
Borrowers take appropriate steps to insure that all of such Inventory meets the
criteria of Eligible Inventory, including delivery of appropriate subordination
agreements, if necessary. The Borrowers will conduct a physical count of their
Inventory at least once per its fiscal year, and during the existence of an
Event of Default, at such other times as the Collateral Agent may reasonably
request. Without the Collateral Agent’s written consent, the Borrowers will not
sell, through a single transaction or a series of related transactions,
Inventory on a bill-and-hold, guaranteed sale, sale and return, sale on
approval, consignment, or other repurchase or return basis in excess of $5
million.
 
(b) In connection with all Inventory financed by letters of credit, the
Borrowers will, when an Event of Default is continuing, at the Collateral
Agent’s request, instruct all suppliers, carriers, forwarders, customs brokers,
warehouses or other persons receiving or holding cash, checks, Inventory,
documents or instruments in which the Collateral Agent holds a security interest
to deliver them to the Collateral Agent and/or subject to the Collateral Agent’s
order, and if they shall come into the Borrowers’ or their Subsidiaries’
 

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possession, to deliver them, upon request, to the Collateral Agent in their
original form. The Borrowers shall also, when an Event of Default is continuing,
at the Collateral Agent’s request, designate the Collateral Agent as the
consignee on all bills of lading and other negotiable and non-negotiable
documents.
 
 
ARTICLE VI
 
 

 
 
Negative Covenants
 
The Borrowers covenant and agree with each Lender that, so long as this
Agreement shall remain in effect (other than in respect of contingent
indemnification obligations for which no claim has been made) and until the
Commitments have been terminated and the Obligations (including principal of and
interest on each Loan, all Fees and all other expenses or amounts payable under
any Loan Document) have been paid in full and all Letters of Credit and Bankers’
Acceptances have been canceled or fully cash collateralized (in a manner
reasonably acceptable to the Administrative Agent and the Issuing Banks) or have
expired and all amounts drawn or paid thereunder have been reimbursed in full,
unless the Required Lenders shall otherwise consent in writing, the Borrowers
will not, and will not permit any of the Material Subsidiaries to:
 
SECTION 6.01. Indebtedness. Incur, create, assume or permit to exist any
Indebtedness, except:
 
(a) Indebtedness existing on the Closing Date and set forth on Schedule 6.01 and
any Permitted Refinancing Indebtedness incurred to Refinance such Indebtedness
(other than intercompany indebtedness Refinanced with Indebtedness owed to a
person not affiliated with the Company or any Subsidiary);
 
(b) Indebtedness created hereunder and under the other Loan Documents;
 
(c) Indebtedness pursuant to Swap Agreements;
 
(d) Indebtedness owed to (including obligations in respect of letters of credit
or bank guarantees or similar instruments for the benefit of) any person
providing workers’ compensation, health, disability or other employee benefits
or property, casualty or liability insurance to the Company or any Subsidiary,
pursuant to reimbursement or indemnification obligations to such person, in each
case in the ordinary course of business; provided, that upon the incurrence of
Indebtedness with respect to reimbursement obligations regarding workers’
compensation claims, such obligations are reimbursed not later than 30 days
following such incurrence;
 
(e) Indebtedness of the Company to Holdings or any Subsidiary and of any
Subsidiary to Holdings, the Company or any other Subsidiary; provided, that (i)
Indebtedness of any Subsidiary that is not a Subsidiary Loan Party owing to the
Loan Parties shall be subject to Section 6.04(b) and (ii) Indebtedness of the
Company to Holdings or any Subsidiary and Indebtedness of any other Loan Party
to Holdings or any Subsidiary that is not a Subsidiary Loan Party (the
“Subordinated Intercompany Debt”)
 

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shall be subordinated to the Obligations on terms reasonably satisfactory to the
Administrative Agent;
 
(f) Indebtedness in respect of performance bonds, bid bonds, appeal bonds,
surety bonds and completion guarantees and similar obligations, in each case
provided in the ordinary course of business, including those incurred to secure
health, safety and environmental obligations in the ordinary course of business;
 
(g) Indebtedness arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument drawn against insufficient
funds in the ordinary course of business or other cash management services in
the ordinary course of business; provided, that (x) such Indebtedness (other
than credit or purchase cards) is extinguished within ten Business Days of
notification to the applicable Borrower of its incurrence and (y) such
Indebtedness in respect of credit or purchase cards is extinguished within 60
days from its incurrence;
 
(h) (i) Indebtedness of a Subsidiary acquired after the Closing Date or an
entity merged into or consolidated with the Company or any Subsidiary after the
Closing Date and Indebtedness assumed in connection with the acquisition of
assets, which Indebtedness in each case exists at the time of such acquisition,
merger or consolidation and is not created in contemplation of such event and
where such acquisition, merger or consolidation is permitted by this Agreement
and (ii) any Permitted Refinancing Indebtedness incurred to Refinance such
Indebtedness; provided, (A) no Default or Event of Default shall have occurred
and be continuing or would result therefrom;
 
(i) Capital Lease Obligations, mortgage financings and purchase money
Indebtedness incurred by the Company or any Subsidiary prior to or within 270
days after the acquisition, lease or improvement of the respective asset
permitted under this Agreement in order to finance such acquisition or
improvement, and any Permitted Refinancing Indebtedness in respect thereof;
provided, that, if immediately after giving effect to such transaction, the
Total Net First Lien Leverage Ratio of the Company on a Pro Forma Basis would be
greater than 4.00 to 1.00, then the amount of Indebtedness incurred pursuant to
this paragraph (i), when combined with the Remaining Present Value of
outstanding leases permitted under Section 6.03, shall not exceed the greater of
$150 million and 4.5% of Consolidated Total Assets as of the end of the fiscal
quarter immediately prior to the date of such incurrence for which financial
statements have been delivered pursuant to Section 5.04;
 
(j) Capital Lease Obligations incurred by the Company or any Subsidiary in
respect of any Sale and Lease-Back Transaction that is permitted under
Section 6.03 and any Permitted Refinancing Indebtedness in respect thereof;
 
(k) other Indebtedness of the Company or any Subsidiary, in an aggregate
principal amount that at the time of, and after giving effect to, the incurrence
thereof, would not exceed the greater of $175 million and 5.0% of Consolidated
Total Assets as of the end of the fiscal quarter immediately prior to the date
of such incurrence for which financial statements have been delivered pursuant
to Section 5.04;
 

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(l) Indebtedness of the Company pursuant to (i) the Second Lien Notes in an
aggregate principal amount that is not in excess of $750 million, (ii) the Berry
Senior Subordinated Notes in an aggregate principal amount that is not in excess
of $425 million, (iii) the Covalence Senior Subordinated Notes in an aggregate
principal amount that is not in excess of $265 million, (iv) the extensions of
Term Loans under the Term Loan Credit Agreement, and (v) any Permitted
Refinancing Indebtedness incurred to Refinance any such Indebtedness;
 
(m) Guarantees (i) by the Subsidiary Loan Parties of the Indebtedness of the
Company described in paragraph (1) of this Section 6.01, so long as the
Guarantee of the Senior Subordinated Notes or any Permitted Refinancing
Indebtedness in respect thereof is subordinated substantially on terms as set
forth in the Senior Subordinated Notes Indentures with respect to the Senior
Subordinated Notes, and so long as any Liens securing the Guarantee of the
Second Lien Notes or any Permitted Refinancing Indebtedness in respect thereof
are subject to the Intercreditor Agreement, (ii) by the Company or any
Subsidiary Loan Party of any Indebtedness of any Borrower or any Subsidiary Loan
Party expressly permitted to be incurred under this Agreement, (iii) by the
Company or any Subsidiary Loan Party of Indebtedness otherwise permitted
hereunder of Holdings or any Subsidiary that is not a Subsidiary Loan Party to
the extent such Guarantees are permitted by Section 6.04 (other than Section
6.04(v)), (iv) by any Foreign Subsidiary of Indebtedness of another Foreign
Subsidiary, and (v) by the Company of Indebtedness of Foreign Subsidiaries
incurred for working capital purposes in the ordinary course of business on
ordinary business terms so long as such Indebtedness is permitted to be incurred
under Section 6.01 (s) to the extent such Guarantees are permitted by 6.04
(other than Section 6.04(v)); provided, that Guarantees by the Company or any
Subsidiary Loan Party under this Section 6.01(m) of any other Indebtedness of a
person that is subordinated to other Indebtedness of such person shall be
expressly subordinated to the Obligations to at least the same extent as the
Guarantee of the Senior Subordinated Notes is under the Senior Subordinated
Notes Indentures;
 
(n) Indebtedness arising from agreements of the Company or any Subsidiary
providing for indemnification, adjustment of purchase or acquisition price or
similar obligations, in each case, incurred or assumed in connection with the
Transactions and any Permitted Business Acquisition or the disposition of any
business, assets or a Subsidiary not prohibited by this Agreement, other than
Guarantees of Indebtedness incurred by any person acquiring all or any portion
of such business, assets or a Subsidiary for the purpose of financing such
acquisition;
 
(o) Indebtedness in respect of letters of credit, bank guarantees, warehouse
receipts or similar instruments issued to support performance obligations and
trade letters of credit (other than obligations in respect of other
Indebtedness) in the ordinary course of business;
 
(p) Indebtedness supported by a Letter of Credit, in a principal amount not in
excess of the stated amount of such Letter of Credit;
 

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(q) Indebtedness consisting of (i) the financing of insurance premiums or (ii)
take-or-pay obligations contained in supply arrangements, in each case, in the
ordinary course of business;
 
(r)  (i) Other Indebtedness incurred by the Company or any Subsidiary Loan
Party; provided that (A) at the time of the incurrence of such Indebtedness and
after giving effect thereto, no Default or Event of Default shall have occurred
and be continuing or would result therefrom, (B) the Company and its
Subsidiaries shall be in Pro Forma Compliance after giving effect to the
issuance incurrence or assumption of such Indebtedness and (C) in the case of
any such Indebtedness that is secured, immediately after giving effect to the
issuance, incurrence or assumption of such Indebtedness, the Total Net First
Lien Leverage Ratio on a Pro Forma Basis shall not be greater than 3.75 to 1.00
and (ii) Permitted Refinancing Indebtedness in respect thereof;
 
(s) Indebtedness of Foreign Subsidiaries; provided that the aggregate amount of
Indebtedness incurred under this clause (s), when aggregated with all other
Indebtedness incurred and outstanding pursuant to this clause (s), shall not
exceed the greater of $100 million and 10.0% of the consolidated assets of the
Foreign Subsidiaries at the time of such incurrence;
 
(t) unsecured Indebtedness in respect of obligations of the Company or any
Subsidiary to pay the deferred purchase price of goods or services or progress
payments in connection with such goods and services; provided, that such
obligations are incurred in connection with open accounts extended by suppliers
on customary trade terms (which require that all such payments be made within 60
days after the incurrence of the related obligations) in the ordinary course of
business and not in connection with the borrowing of money or any Swap
Agreements;
 
(u) Indebtedness representing deferred compensation to employees of the Company
or any Subsidiary incurred in the ordinary course of business;
 
(v) [Reserved];
 
(w) Indebtedness of Foreign Subsidiaries incurred under lines of credit or
overdraft facilities (including, but not limited to, intraday, ACH and
purchasing card/T&E services) extended by one or more financial institutions
reasonably acceptable to the Administrative Agent or one or more of the Lenders
and (in each case) established for such Foreign Subsidiaries’ ordinary course of
operations (such Indebtedness, the “Overdraft Line”), which Indebtedness may be
secured as, but only to the extent, provided in Section 6.02(b) and in the
Security Documents;
 
(x) Indebtedness incurred on behalf of, or representing Guarantees of
Indebtedness of, joint ventures not in excess, at any one time outstanding, of
the greater of $175 million or 5.0% of Consolidated Total Assets as of the end
of the fiscal quarter immediately prior to the date of such incurrence for which
financial statements have been delivered pursuant to Section 5.04;
 

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(y) Indebtedness consisting of promissory notes issued by the Company or any
Subsidiary to current or former officers, directors and employees, their
respective estates, spouses or former spouses to finance the purchase or
redemption of Equity Interests of Holdings or any Parent Entity permitted by
Section 6.06;
 
(z) Indebtedness consisting of obligations of the Company or any Subsidiary
under deferred compensation or other similar arrangements incurred by such
Person in connection with the Transactions and Permitted Business Acquisitions
or any other Investment expressly permitted hereunder; and
 
(aa) all premium (if any), interest (including post-petition interest), fees,
expenses, charges and additional or contingent interest on obligations described
in paragraphs (a) through (z) above.
 
SECTION 6.02. Liens. Create, incur, assume or permit to exist any Lien on any
property or assets (including stock or other securities of any person, including
the Company and any Subsidiary) at the time owned by it or on any income or
revenues or rights in respect of any thereof, except the following
(collectively, “Permitted Liens”):
 
(a) Liens on property or assets of the Company and the Subsidiaries existing on
the Closing Date and set forth on Schedule 6.02(a) or, to the extent not listed
in such Schedule, where such property or assets have a fair market value that
does not exceed $10 million in the aggregate and $5 million in respect of
Accounts and Inventory, and any modifications, replacements, renewals or
extensions thereof; provided, that such Liens shall secure only those
obligations that they secure on the Closing Date (and any Permitted Refinancing
Indebtedness in respect of such obligations permitted by Section 6.01(a)) and
shall not subsequently apply to any other property or assets of the Company or
any Subsidiary other than (A) after-acquired property that is affixed or
incorporated into the property covered by such Lien, and (B) proceeds and
products thereof;
 
(b) any Lien created under the Loan Documents (including, without limitation,
Liens created under the Security Documents securing obligations in respect of
Swap Agreements owed to a person that is a Lender or an Affiliate of a Lender at
the time of entry into such Swap Agreements) or permitted in respect of any
Mortgaged Property by the terms of the applicable Mortgage and, provided that
such Liens are subject to the terms of the Senior Lender Intercreditor
Agreement, any Lien securing the Term Loan Credit Agreement or any Indebtedness
or obligations under the Term Loan Credit Agreement or any “Loan Documents”
thereunder; provided, however, in no event shall the holders of the Indebtedness
under the Overdraft Line have the right to receive proceeds in respect of a
claim in excess of $20 million in the aggregate (plus (i) any accrued and unpaid
interest in respect of Indebtedness incurred by the Company and the Subsidiaries
under the Overdraft Line and (ii) any accrued and unpaid fees and expenses owing
by the Company and the Subsidiaries under the Overdraft Line) from the
enforcement of any remedies available to the Secured Parties under all of the
Loan Documents;
 

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(c) any Lien on any property or asset (other than Accounts and Inventory unless
such Accounts and Inventory are held by a Subsidiary that is not a Borrower and
such Accounts and Inventory are not commingled with the Accounts and Inventory
of any other Borrower) of the Company or any Subsidiary securing Indebtedness or
Permitted Refinancing Indebtedness permitted by Section 6.01(h); provided, that
such Lien (i) does not apply to any other property or assets of the Company or
any of the Subsidiaries not securing such Indebtedness at the date of the
acquisition of such property or asset (other than after acquired property
subjected to a Lien securing Indebtedness and other obligations incurred prior
to such date and which Indebtedness and other obligations are permitted
hereunder that require a pledge of after acquired property, it being understood
that such requirement shall not be permitted to apply to any property to which
such requirement would not have applied but for such acquisition), (ii) such
Lien is not created in contemplation of or in connection with such acquisition
and (iii) in the case of a Lien securing Permitted Refinancing Indebtedness, any
such Lien is permitted, subject to compliance with clause (e) of the definition
of the term “Permitted Refinancing Indebtedness”;
 
(d) Liens for Taxes, assessments or other governmental charges or levies not yet
delinquent or that are being contested in compliance with Section 5.03;
 
(e) Liens imposed by law, such as landlord’s, carriers’, warehousemen’s,
mechanics’, materialmen’s, repairmen’s, construction or other like Liens arising
in the ordinary course of business and securing obligations that are not overdue
by more than 30 days or that are being contested in good faith by appropriate
proceedings and in respect of which, if applicable, the Company or any
Subsidiary shall have set aside on its books reserves in accordance with GAAP;
 
(f) (i) pledges and deposits and other Liens with respect to property other than
Accounts and Inventory made in the ordinary course of business in compliance
with the Federal Employers Liability Act or any other workers’ compensation,
unemployment insurance and other social security laws or regulations and
deposits securing liability to insurance carriers under insurance or
self-insurance arrangements in respect of such obligations and (ii) pledges and
deposits and other Liens with respect to property other than Accounts and
Inventory securing liability for reimbursement or indemnification obligations of
(including obligations in respect of letters of credit or bank guarantees for
the benefit of) insurance carriers providing property, casualty or liability
insurance to the Company or any Subsidiary;
 
(g) deposits to secure the performance of bids, trade contracts (other than for
Indebtedness), leases (other than Capital Lease Obligations), statutory
obligations, surety and appeal bonds, performance and return of money bonds,
bids, leases, government contracts, trade contracts, agreements with utilities,
and other obligations of a like nature (including letters of credit in lieu of
any such bonds or to support the issuance thereof) incurred in the ordinary
course of business, including those incurred to secure health, safety and
environmental obligations in the ordinary course of business;
 

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(h) zoning restrictions, survey exceptions and such matters as an accurate
survey would disclose, easements, trackage rights, leases (other than Capital
Lease Obligations), licenses, special assessments, rights-of-way, covenants,
conditions, restrictions and declaration on or with respect to the use of Real
Property, servicing agreements, development agreements, site plan agreements and
other similar encumbrances incurred in the ordinary course of business and title
defects or irregularities that are of a minor nature and that, in the aggregate,
do not interfere in any material respect with the ordinary conduct of the
business of the Company or any Subsidiary;
 
(i) Liens securing Indebtedness permitted by Section 6.01(i) (limited to the
assets subject to such Indebtedness);
 
(j) Liens arising out of capitalized lease transactions permitted under
Section 6.03, so long as such Liens attach only to the property sold and being
leased in such transaction and any accessions thereto or proceeds thereof and
related property;
 
(k) Liens securing judgments that do not constitute an Event of Default under
Section 7.01(j);
 
(l) Liens disclosed by the title insurance policies delivered on or subsequent
to the Closing Date and pursuant to Section 5.10 and any replacement, extension
or renewal of any such Lien; provided, that such replacement, extension or
renewal Lien shall not cover any property other than the property that was
subject to such Lien prior to such replacement, extension or renewal; provided,
further, that the Indebtedness and other obligations secured by such
replacement, extension or renewal Lien are permitted by this Agreement;
 
(m) any interest or title of a lessor or sublessor under any leases or subleases
entered into by the Company or any Subsidiary in the ordinary course of
business;
 
(n) Liens that are contractual rights of set-off (i) relating to the
establishment of depository relations with banks not given in connection with
the issuance of Indebtedness, (ii) relating to pooled deposit or sweep accounts
of the Company or any Subsidiary to permit satisfaction of overdraft or similar
obligations incurred in the ordinary course of business of the Company or any
Subsidiary or (iii) relating to purchase orders and other agreements entered
into with customers of the Company or any Subsidiary in the ordinary course of
business;
 
(o) Liens arising solely by virtue of any statutory or common law provision
relating to banker’s liens, rights of set-off or similar rights;
 
(p) Liens securing obligations in respect of trade-related letters of credit,
banker’s acceptances or bank guarantees permitted under Section 6.01(f), (k) or
(o) and covering the goods (or the documents of title in respect of such goods)
financed by such letters of credit, bankers’ acceptances or bank guarantees and
the proceeds and products thereof;
 

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(q) leases or subleases, licenses or sublicenses (including with respect to
intellectual property and software) granted to others in the ordinary course of
business not interfering in any material respect with the business of the
Company and its Subsidiaries, taken as a whole;
 
(r) Liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customs duties in connection with the importation of goods;
 
(s) Liens solely on any cash earnest money deposits made by the Company or any
of the Subsidiaries in connection with any letter of intent or purchase
agreement in respect of any Investment permitted hereunder;
 
(t) Liens with respect to property or assets of any Foreign Subsidiary securing
Indebtedness of a Foreign Subsidiary permitted under Section 6.01;
 
(u) other Liens with respect to property or assets of the Company or any
Subsidiary; provided that (i) after giving effect to any such Lien and the
incurrence of Indebtedness, if any, secured by such Lien is created, incurred,
acquired or assumed (or any prior Indebtedness becomes so secured) on a Pro
Forma Basis, the Total Net First Lien Leverage Ratio on the last day of the
Company’s then most recently completed fiscal quarter for which financial
statements are available shall be less than or equal to 3.75 to 1.00, (ii) at
the time of the incurrence of such Lien and after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing or would
result therefrom, (iii) the Indebtedness or other obligations secured by such
Lien are otherwise permitted by this Agreement, and (iv) to the extent such
Liens are pari passu or subordinated to the Liens granted hereunder, an
intercreditor agreement reasonably satisfactory to the Administrative Agent
shall be entered into providing that such new liens will be secured equally and
ratably with the Liens granted hereunder, or, as applicable, subordinated to the
Liens granted hereunder, in each case, on customary terms, or, in the case of
Liens on Accounts or Inventory of the Borrowers and the Domestic Subsidiaries,
on terms no less favorable to the Lenders than those set forth in the
Intercreditor Agreement; provided further that any Liens on Accounts or
Inventory of the Borrowers or the Domestic Subsidiaries incurred pursuant to
this Section 6.02(u) shall be subordinated to the Liens granted hereunder.
 
(v) the prior rights of consignees and their lenders under consignment
arrangements entered into in the ordinary course of business;
 
(w) agreements to subordinate any interest of the Company or any Subsidiary in
any accounts receivable or other proceeds arising from inventory consigned by
the Company or any of its Subsidiaries pursuant to an agreement entered into in
the ordinary course of business;
 
(x) Liens arising from precautionary Uniform Commercial Code financing
statements or consignments entered into in connection with any transaction
otherwise permitted under this Agreement;
 

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(y) Liens on Equity Interests in joint ventures securing obligations of such
joint venture;
 
(z) Liens on securities that are the subject of repurchase agreements
constituting Permitted Investments under clause (c) of the definition thereof;
 
(aa) [Reserved];
 
(bb) Liens on goods or inventory the purchase, shipment or storage price of
which is financed by a documentary letter of credit, bank guarantee or bankers’
acceptance issued or created for the account of a Borrower or any Subsidiary in
the ordinary course of business; provided, that such Lien secures only the
obligations of such Borrower or such Subsidiaries in respect of such letter of
credit, bankers’ acceptance or bank guarantee to the extent permitted under
Section 6.01;
 
(cc) Liens securing insurance premiums financing arrangements, provided, that
such Liens are limited to the applicable unearned insurance premiums;
 
(dd) Liens in favor of the Company or any Subsidiary Loan Party; provided that
if any such Lien shall cover any Collateral, the holder of such Lien shall
execute and deliver to the Administrative Agent a subordination agreement in
form and substance reasonably satisfactory to the Administrative Agent;
 
(ee) Liens securing obligations under the Second Lien Note Documents and any
Permitted Refinancing Indebtedness in respect thereof, to the extent such Liens
are subject to the Intercreditor Agreement;
 
(ff) Liens on not more than $30 million of deposits securing Swap Agreements;
and
 
(gg) other Liens with respect to property or assets of the Company or any
Subsidiary securing obligations in an aggregate principal amount outstanding at
any time not to exceed $30 million.
 
SECTION 6.03. Sale and Lease-Back Transactions. Enter into any arrangement,
directly or indirectly, with any person whereby it shall sell or transfer any
property, real or personal, used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property
that it intends to use for substantially the same purpose or purposes as the
property being sold or transferred (a “Sale and Lease-Back Transaction”);
provided, that a Sale and Lease-Back Transaction shall be permitted (A) with
respect to property (i) owned by the Company or any Domestic Subsidiary that is
acquired after the Closing Date so long as such Sale and Lease-Back Transaction
is consummated within 180 days of the acquisition of such property or (ii) by
any Foreign Subsidiary regardless of when such property was acquired, and (B)
with respect to any property owned by the Company or any Domestic Subsidiary, if
at the time the lease in connection therewith is entered into, and after giving
effect to the entering into of such lease, (a) the Total Net First Lien Leverage
Ratio is equal to or less than 4.00 to 1.00, or (b) if the Total Net First Lien
Leverage Ratio is greater than 4.00 to 1.00, the Remaining Present Value of such
lease, together with Indebtedness outstanding
 

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pursuant to Section 6.01(i) and the Remaining Present Value of outstanding
leases previously entered into under this Section 6.03(b), shall not exceed the
greater of $150 million and 4.5% of Consolidated Total Assets as of the end of
the fiscal quarter immediately prior to the date the lease was entered into for
which financial statements have been delivered pursuant to Section 5.04.
 
SECTION 6.04. Investments, Loans and Advances. Purchase, hold or acquire
(including pursuant to any merger with a person that is not a Wholly Owned
Subsidiary immediately prior to such merger) any Equity Interests, evidences of
Indebtedness or other securities of, make or permit to exist any loans or
advances to or Guarantees of the obligations of, or make or permit to exist any
investment or any other interest in (each, an “Investment”), any other person,
except:
 
(a) the Transactions;
 
(b) (i) Investments by the Company or any Subsidiary in the Equity Interests of
the Company or any Subsidiary; (ii) intercompany loans from the Company or any
Subsidiary to the Company or any Subsidiary; and (iii) Guarantees by the Company
or any Subsidiary Loan Party of Indebtedness otherwise expressly permitted
hereunder of the Company or any Subsidiary; provided, that the sum of (A)
Investments (valued at the time of the making thereof and without giving effect
to any write-downs or write-offs thereof) made after the Closing Date by the
Loan Parties pursuant to clause (i) in Subsidiaries that are not Subsidiary Loan
Parties, plus (B) net intercompany loans made after the Closing Date to
Subsidiaries that are not Subsidiary Loan Parties pursuant to clause (ii), plus
(C) Guarantees of Indebtedness after the Closing Date of Subsidiaries that are
not Subsidiary Loan Parties pursuant to clause (iii), shall not exceed an
aggregate net amount equal to (x) the greater of (1) $100 million and (2) 4.5%
of Consolidated Total Assets as of the end of the fiscal quarter immediately
prior to the date of such Investment for which financial statements have been
delivered pursuant to Section 5.04 (plus any return of capital actually received
by the respective investors in respect of Investments theretofore made by them
pursuant to this paragraph (b)); plus (y) the portion, if any, of the Cumulative
Credit on the date of such election that the Company elects to apply to this
Section 6.04(b)(y), such election to be specified in a written notice of a
Responsible Officer of the Company calculating in reasonable detail the amount
of Cumulative Credit immediately prior to such election and the amount thereof
elected to be so applied; provided, further, that intercompany current
liabilities incurred in the ordinary course of business in connection with the
cash management operations of the Company and the Subsidiaries shall not be
included in calculating the limitation in this paragraph at any time.
 
(c) Permitted Investments and Investments that were Permitted Investments when
made;
 
(d) Investments arising out of the receipt by the Company or any Subsidiary of
noncash consideration for the sale of assets permitted under Section 6.05;
 

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(e) loans and advances to officers, directors, employees or consultants of the
Company or any Subsidiary (i) in the ordinary course of business not to exceed
the greater of $25 million and 1.0% of Consolidated Total Assets as of the end
of the fiscal quarter immediately prior to the date of such loan or advance for
which financial statements have been delivered pursuant to Section 5.04, in the
aggregate at any time outstanding (calculated without regard to write downs or
write offs thereof), (ii) in respect of payroll payments and expenses in the
ordinary course of business and (iii) in connection with such person’s purchase
of Equity Interests of Holdings (or any Parent Entity) solely to the extent that
the amount of such loans and advances shall be contributed to the Company in
cash as common equity;
 
(f) accounts receivable, security deposits and prepayments arising and trade
credit granted in the ordinary course of business and any assets or 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 and any prepayments and other credits to suppliers made in the
ordinary course of business;
 
(g) Swap Agreements;
 
(h) Investments existing on, or contractually committed as of, the Closing Date
and set forth on Schedule 6.04 and any extensions, renewals or reinvestments
thereof, so long as the aggregate amount of all Investments pursuant to this
clause (h) is not increased at any time above the amount of such Investment
existing on the Closing Date;
 
(i) Investments resulting from pledges and deposits under Sections 6.02(f), (g),
(k), (r), (s), and (u);
 
(j) other Investments by the Company or any Subsidiary in an aggregate amount
(valued at the time of the making thereof, and without giving effect to any
write-downs or write-offs thereof) not to exceed (i) the greater of $225 million
and 6.5% of Consolidated Total Assets as of the end of the fiscal quarter
immediately prior to the date of such incurrence for which financial statements
have been delivered pursuant to Section 5.04 (plus any returns of capital
actually received by the respective investor in respect of investments
theretofore made by it pursuant to this paragraph (j)) plus (ii) the portion, if
any, of the Cumulative Credit on the date of such election that the Company
elects to apply to this Section 6.04(j)(ii), such election to be specified in a
written notice of a Responsible Officer of the Company calculating in reasonable
detail the amount of Cumulative Credit immediately prior to such election and
the amount thereof elected to be so applied;
 
(k) Investments constituting Permitted Business Acquisitions;
 
(l) intercompany loans between Foreign Subsidiaries and Guarantees by Foreign
Subsidiaries permitted by Section 6.01(m);
 
(m) Investments received in connection with the bankruptcy or reorganization of,
or settlement of delinquent accounts and disputes with or judgments against,
 

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customers and suppliers, in each case in the ordinary course of business or
Investments acquired by the Company as a result of a foreclosure by the Company
or any of the Subsidiaries with respect to any secured Investments or other
transfer of title with respect to any secured Investment in default;
 
(n) Investments of a Subsidiary acquired after the Closing Date or of an entity
merged into the Company or merged into or consolidated with a Subsidiary after
the Closing Date, in each case, to the extent permitted under this Section 6.04
and, in the case of any merger or consolidation, in accordance with Section 6.05
to the extent that such Investments were not made in contemplation of or in
connection with such acquisition, merger or consolidation and were in existence
on the date of such acquisition, merger or consolidation;
 
(o) acquisitions by the Company of obligations of one or more officers or other
employees of Holdings, any Parent Entity, the Company or its Subsidiaries in
connection with such officer’s or employee’s acquisition of Equity Interests of
Holdings or any Parent Entity, so long as no cash is actually advanced by the
Company or any of the Subsidiaries to such officers or employees in connection
with the acquisition of any such obligations;
 
(p) Guarantees by the Company or any Subsidiary of operating leases (other than
Capital Lease Obligations) or of other obligations that do not constitute
Indebtedness, in each case entered into by the Company or any Subsidiary in the
ordinary course of business;
 
(q) Investments to the extent that payment for such Investments is made with
Equity Interests of Holdings (or any Parent Entity);
 
(r) Investments in the equity interests of one or more newly formed persons that
are received in consideration of the contribution by Holdings, the Company or
the applicable Subsidiary of assets (including Equity Interests and cash) to
such person or persons; provided, that (i) the fair market value of such assets,
determined on an arms’-length basis, so contributed pursuant to this paragraph
(r) shall not in the aggregate exceed $30 million and (ii) in respect of each
such contribution, a Responsible Officer of the Company shall certify, in a form
to be agreed upon by the Company and the Administrative Agent (x) after giving
effect to such contribution, no Default or Event of Default shall have occurred
and be continuing, (y) the fair market value of the assets so contributed and
(z) that the requirements of paragraph (i) of this proviso remain satisfied;
 
(s) Investments consisting of the redemption, purchase, repurchase or retirement
of any Equity Interests permitted under Section 6.06;
 
(t) Investments in the ordinary course of business consisting of Uniform
Commercial Code Article 3 endorsements for collection or deposit and Uniform
Commercial Code Article 4 customary trade arrangements with customers consistent
with past practices;
 

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(u) Investments in Foreign Subsidiaries not to exceed the greater of $75 million
and 2.0% of Consolidated Total Assets as of the end of the fiscal quarter
immediately prior to the date of such Investment for which financial statements
have been delivered pursuant to Section 5.04, in the aggregate, as valued at the
fair market value of such Investment at the time such Investment is made;
 
(v) Guarantees permitted under Section 6.01 (except to the extent such Guarantee
is expressly subject to Section 6.04);
 
(w) advances in the form of a prepayment of expenses, so long as such expenses
are being paid in accordance with customary trade terms of the Company or such
Subsidiary;
 
(x) Investments by the Company and its Subsidiaries, including loans to any
direct or indirect parent of the Company, if such Borrower or any other
Subsidiary would otherwise be permitted to make a dividend or distribution in
such amount (provided that the amount of any such investment shall also be
deemed to be a distribution under the appropriate clause of Section 6.06 for all
purposes of this Agreement);
 
(y) [Reserved];
 
(z) Investments received substantially contemporaneously in exchange for Equity
Interests of any Parent Entity; provided that such Investments are not included
in any determination of the Cumulative Credit; and
 
(aa) Investments in joint ventures not in excess of the greater of $75 million
and 2.0% of Consolidated Total Assets as of the end of the fiscal quarter
immediately prior to the date of such Investment for which financial statements
have been delivered pursuant to Section 5.04, in the aggregate.
 
The amount of Investments that may be made at any time pursuant to clause (C) of
the proviso of Section 6.04(b) or 6.04(j) (such Sections, the “Related
Sections”) may, at the election of the Company, be increased by the amount of
Investments that could be made at such time under the other Related Section;
provided that the amount of each such increase in respect of one Related Section
shall be treated as having been used under the other Related Section.
 
SECTION 6.05. Mergers, Consolidations, Sales of Assets and Acquisitions. Merge
into or consolidate with any other person, or permit any other person to merge
into or consolidate with it, or sell, transfer, lease or otherwise dispose of
(in one transaction or in a series of transactions) all or any part of its
assets (whether now owned or hereafter acquired), or issue, sell, transfer or
otherwise dispose of any Equity Interests of the Company or any Subsidiary, or
purchase, lease or otherwise acquire (in one transaction or a series of
transactions) all or any substantial part of the assets of any other person or
any division, unit or business of any person, except that this Section shall not
prohibit:
 
(a) (i) the purchase and sale of inventory in the ordinary course of business by
the Company or any Subsidiary and the sale of receivables by any Foreign
Subsidiary pursuant to non-recourse factoring arrangements in the ordinary
course of business of
 

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such Foreign Subsidiary, (ii) the acquisition or lease (pursuant to an operating
lease) of any other asset in the ordinary course of business by the Company or
any Subsidiary, (iii) the sale of surplus, obsolete or worn out equipment or
other property in the ordinary course of business by the Company or any
Subsidiary or (iv) the sale of Permitted Investments in the ordinary course of
business;
 
(b) if at the time thereof and immediately after giving effect thereto no
Default or Event of Default shall have occurred and be continuing or would
result therefrom, (i) the merger of any Subsidiary into the Company in a
transaction in which the Company is the survivor, (ii) the merger or
consolidation of any Subsidiary into or with any Subsidiary Loan Party in a
transaction in which the surviving or resulting entity is a Subsidiary Loan
Party and, in the case of each of clauses (i) and (ii), no person other than the
Company or Subsidiary Loan Party receives any consideration, (iii) the merger or
consolidation of any Subsidiary that is not a Subsidiary Loan Party into or with
any other Subsidiary that is not a Subsidiary Loan Party, (iv) the liquidation
or dissolution or change in form of entity of any Subsidiary (other than the
Company) if the Company determines in good faith that such liquidation,
dissolution or change in form is in the best interests of the Company and is not
materially disadvantageous to the Lenders or (v) any Subsidiary may merge with
any other person in order to effect an Investment permitted pursuant to Section
6.04 so long as the continuing or surviving person shall be a Subsidiary, which
shall be a Loan Party if the merging Subsidiary was a Loan Party and which
together with each of its Subsidiaries shall have complied with the requirements
of Section 5.10;
 
(c) sales, transfers, leases or other dispositions to the Company or a
Subsidiary (upon voluntary liquidation or otherwise); provided, that any sales,
transfers, leases or other dispositions by a Loan Party to a Subsidiary that is
not a Subsidiary Loan Party in reliance on this paragraph (c) shall be made in
compliance with Section 6.07 and shall be included in Section 6.05(g);
 
(d) Sale and Lease-Back Transactions permitted by Section 6.03;
 
(e) Investments permitted by Section 6.04, Permitted Liens, Dividends permitted
by Section 6.06 and capital expenditures;
 
(f) the sale of defaulted receivables in the ordinary course of business and not
as part of an accounts receivables financing transaction;
 
(g) sales, transfers, leases or other dispositions of assets not otherwise
permitted by this Section 6.05 (or required to be included in this clause (g)
pursuant to Section 6.05(c)); provided, that (i) the aggregate gross proceeds
(including noncash proceeds) of any or all assets sold, transferred, leased or
otherwise disposed of in reliance upon this paragraph (g) shall not exceed, in
any fiscal year of the Company, the greater of (x) $200 million and (y) 6.5% of
Consolidated Total Assets as of the end of the fiscal quarter immediately prior
to the date of such incurrence for which financial statements have been
delivered pursuant to Section 5.04, (ii) no Default or Event of Default exists
or would result therefrom; (iii) immediately after giving effect thereto, the
Revolving
 

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Facility Credit Exposure shall not exceed the Borrowing Base calculated on a Pro
Forma Basis after giving effect to such sale, transfer, lease or other
disposition, and (iv) immediately after giving effect to any such sale, lease,
transfer, lease or other disposition of Accounts or Inventory not undertaken in
the ordinary course of business, the Revolving Facility Credit Exposure shall
not exceed the Borrowing Base;
 
(h) Permitted Business Acquisitions (including any merger or consolidation in
order to effect a Permitted Business Acquisition); provided, that following any
such merger or consolidation (i) involving the Company, the Company is the
surviving corporation, (ii) involving a Domestic Subsidiary, the surviving or
resulting entity shall be a Subsidiary Loan Party that is a Wholly Owned
Subsidiary and (iii) involving a Foreign Subsidiary, the surviving or resulting
entity shall be a Wholly Owned Subsidiary;
 
(i) leases, licenses (on a non-exclusive basis with respect to intellectual
property), or subleases or sublicenses (on a non-exclusive basis with respect to
intellectual property) of any real or personal property in the ordinary course
of business;
 
(j) sales, leases or other dispositions of inventory of the Company and its
Subsidiaries determined by the management of the Company to be no longer useful
or necessary in the operation of the business of the Company or any of the
Subsidiaries;
 
(k) acquisitions and purchases made with the proceeds of any Asset Sale pursuant
to the first proviso of paragraph (a) of the definition of “Net Proceeds”;
 
(l) [Reserved];
 
(m) any exchange of assets for services and/or other assets of comparable or
greater value; provided, that (i) at least 90% of the consideration received by
the transferor consists of assets that will be used in a business or business
activity permitted hereunder, (ii) in the event of a swap with a fair market
value in excess of $10.0 million, the Administrative Agent shall have received a
certificate from a Responsible Officer of the Company with respect to such fair
market value and (iii) in the event of a swap with a fair market value in excess
of $20.0 million, such exchange shall have been approved by at least a majority
of the Board of Directors of Holdings or the Company; provided, that (A) the
aggregate gross consideration (including exchange assets, other noncash
consideration and cash proceeds) of any or all assets exchanged in reliance upon
this paragraph (m) shall not exceed, in any fiscal year of the Company, the
greater of $200 million and 6.5% of Consolidated Total Assets as of the end of
the fiscal quarter immediately prior to the date of such incurrence for which
financial statements have been delivered pursuant to Section 5.04, (B) no
Default or Event of Default exists or would result therefrom and (C) immediately
after giving effect to such exchange, the Revolving Facility Credit Exposure
shall not exceed the Borrowing Base calculated on a Pro Forma Basis after giving
effect to such exchange;
 
(n) the sale of assets described on Schedule 6.05; and
 
(o) the Business Combination.
 

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Notwithstanding anything to the contrary contained in Section 6.05 above, (i) no
sale, transfer or other disposition of assets shall be permitted by this
Section 6.05 (other than sales, transfers, leases, licenses or other
dispositions to Loan Parties pursuant to paragraph (c) of this Section 6.05)
unless such disposition is for fair market value and (ii) no sale, transfer or
other disposition of assets in excess of $15 million shall be permitted by
paragraph (g) of this Section 6.05 unless such disposition is for at least 75%
cash consideration; provided, that for purposes of clause (ii), (a) the amount
of any liabilities (as shown on the Company’s or any Subsidiary’s most recent
balance sheet or in the notes thereto) of the Company or any Subsidiary of the
Company (other than liabilities that are by their terms subordinated to the
Obligations) that are assumed by the transferee of any such assets, (b) any
notes or other obligations or other securities or assets received by the Company
or such Subsidiary of the Company from such transferee that are converted by the
Company or such Subsidiary of the Company into cash within 180 days of the
receipt thereof (to the extent of the cash received) and (c) any Designated
Non-Cash Consideration received by the Company or any of its Subsidiaries in
such Asset Sale having an aggregate fair market value, taken together with all
other Designated Non-Cash Consideration received pursuant to this clause (c)
that is at that time outstanding, not to exceed the greater of 3.0% of
Consolidated Total Assets and $100 million at the time of the receipt of such
Designated Non-Cash Consideration (with the fair market value of each item of
Designated Non-Cash Consideration being measured at the time received and
without giving effect to subsequent changes in value) shall be deemed to be
cash. To the extent any Collateral is disposed of in a transaction expressly
permitted by this Section 6.05 to any Person other than Holdings, the Company or
any Subsidiary, such Collateral shall be sold free and clear of the Liens
created by the Loan Documents, and the Administrative Agent shall take, and
shall be authorized by each Lender to take, any actions reasonably requested by
the Company in order to evidence the foregoing. Anything contained herein to the
contrary notwithstanding, (A) neither the Company nor any other Loan Party shall
sell or otherwise dispose of any Inventory or Accounts (other than sales of
Inventory in the ordinary course of business and sales of Accounts for
collection) if, as a result of such sale or other disposition, the Revolving
Facility Credit Exposure would exceed the Borrowing Base, in each case
determined as of the time of such sale or other disposition, and (B) none of the
capital stock of any Borrower shall be sold or transferred, nor shall any
Borrower enter into any merger or similar transaction in which such Borrower is
not the surviving entity, unless in any such case (1) the obligations of such
Borrower are assumed by another Borrower on terms reasonably acceptable to the
Administrative Agent, (2) such event would not result in a Default or an Event
of Default, and (3) the portion of the Revolving Facility Credit Exposure of the
assuming Borrower does not exceed the portion of the Borrowing Base attributable
to the Accounts and Inventory of the assuming Borrower.
 
SECTION 6.06. Dividends and Distributions. Declare or pay any dividend or make
any other distribution (by reduction of capital or otherwise), whether in cash,
property, securities or a combination thereof, with respect to any of its Equity
Interests (other than dividends and distributions on Equity Interests payable
solely by the issuance of additional Equity Interests (other than Disqualified
Stock) of the person paying such dividends or distributions) or directly or
indirectly redeem, purchase, retire or otherwise acquire for value (or permit
any Subsidiary to purchase or acquire) any of its Equity Interests or set aside
any amount
 

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for any such purpose (other than through the issuance of additional Equity
Interests (other than Disqualified Stock) of the person redeeming, purchasing,
retiring or acquiring such shares) (collectively, the “Distributions”);
provided, however, that:
 
(a) any Subsidiary of the Company may declare and pay dividends to, repurchase
its Equity Interests from or make other distributions to the Company or to any
Wholly Owned Subsidiary of the Company (or, in the case of non-Wholly Owned
Subsidiaries, to the Company or any Subsidiary that is a direct or indirect
shareholder of such Subsidiary and to each other owner of Equity Interests of
such Subsidiary on a pro rata basis (or more favorable basis from the
perspective of the Company or such Subsidiary) based on their relative ownership
interests so long as any repurchase of its Equity Interests from a person that
is not the Company or a Subsidiary is permitted under Section 6.04);
 
(b) the Company may declare and pay dividends or make other distributions to
Holdings in respect of (i) overhead, legal, accounting and other professional
fees and expenses of Holdings or any Parent Entity, (ii) fees and expenses
related to any public offering or private placement of debt or equity securities
of Holdings or any Parent Entity whether or not consummated, (iii) franchise
taxes and other fees, taxes and expenses in connection with the maintenance of
its existence and its (or any Parent Entity’s indirect) ownership of the
Company, (iv) payments permitted by Section 6.07(b), (v) the tax liability to
each relevant jurisdiction in respect of consolidated, combined, unitary or
affiliated returns for the relevant jurisdiction of Holdings (or any Parent
Entity) attributable to Holdings, the Company or its Subsidiaries and (vi)
customary salary, bonus and other benefits payable to, and indemnities provided
on behalf of, officers and employees of Holdings or any Parent Entity, in each
case in order to permit Holdings or any Parent Entity to make such payments;
provided, that in the case of clauses (i), (ii) and (iii), the amount of such
dividends and distributions shall not exceed the portion of any amounts referred
to in such clauses (i), (ii) and (iii) that are allocable to the Company and its
Subsidiaries (which shall be 100% for so long as Holdings or such Parent Entity,
as the case may be, owns no assets other than the Equity Interests in the
Company, Holdings or another Parent Entity);
 
(c) the Company may declare and pay dividends or make other distributions to
Holdings the proceeds of which are used to purchase or redeem the Equity
Interests of Holdings or any Parent Entity (including related stock appreciation
rights or similar securities) held by then present or former directors,
consultants, officers or employees of Holdings, the Company or any of the
Subsidiaries or by any Plan or shareholders’ agreement then in effect upon such
person’s death, disability, retirement or termination of employment or under the
terms of any such Plan or any other agreement under which such shares of stock
or related rights were issued; provided, that the aggregate amount of such
purchases or redemptions under this paragraph (c) shall not exceed in any fiscal
year $20 million (plus the amount of net proceeds contributed to the Company
that were (x) received by Holdings or any Parent Entity during such calendar
year from sales of Equity Interests of Holdings or any Parent Entity of Holdings
to directors, consultants, officers or employees of Holdings, any Parent Entity,
the Company or any Subsidiary in connection with permitted employee compensation
and incentive arrangements and (y) of
 

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any key-man life insurance policies received during such calendar year), which,
if not used in any year, may be carried forward to any subsequent calendar year;
 
(d) noncash repurchases of Equity Interests deemed to occur upon exercise of
stock options if such Equity Interests represent a portion of the exercise price
of such options;
 
(e) the Company may pay dividends to Holdings in an aggregate amount equal to
the portion, if any, of the Cumulative Credit on such date that the Company
elects to apply to this Section 6.06(e), such election to be specified in a
written notice of a Responsible Officer of the Company calculating in reasonable
detail the amount of Cumulative Credit immediately prior to such election and
the amount thereof elected to be so applied; provided, that no Default or Event
of Default has occurred and is continuing or would result therefrom and, after
giving effect thereto, that the Company and its Subsidiaries shall be in Pro
Forma Compliance;
 
(f) the Company may pay dividends on the Closing Date to consummate the
Transactions;
 
(g) the Company may pay dividends or distributions to allow Holdings or any
Parent Entity to make payments in cash, in lieu of the issuance of fractional
shares, upon the exercise of warrants or upon the conversion or exchange of
Equity Interests of any such person;
 
(h) after a Qualified IPO, the Company may pay dividends and make distributions
to, or repurchase or redeem shares from, its equity holders in an amount equal
to 6.0% per annum of the net proceeds received by the Company from any public
offering of Equity Interests of the Company or any direct or indirect parent of
the Company;
 
(i) the Company may make distributions to Holdings or any Parent Entity to
finance any Investment permitted to be made pursuant to Section 6.04; provided,
that (A) such distribution shall be made substantially concurrently with the
closing of such Investment and (B) such parent shall, immediately following the
closing thereof, cause (1) all property acquired (whether assets or Equity
Interests) to be contributed to the Company or a Subsidiary or (2) the merger
(to the extent permitted in Section 6.05) of the Person formed or acquired into
the Company or a Subsidiary in order to consummate such Permitted Business
Acquisition or Investment; and
 
(j) the Company may pay dividends after the Closing Date to permit Holdings to
make payments required under the Acquisition Agreement (including Sections 2.9
and 5.4 thereof).
 
SECTION 6.07. Transactions with Affiliates. xxix)  Sell or transfer any property
or assets to, or purchase or acquire any property or assets from, or otherwise
engage in any other transaction with, any of its Affiliates or any known direct
or indirect holder of 10% or more of any class of capital stock of Holdings or
the Company in a transaction involving aggregate consideration in excess of $5
million, unless such transaction is (i) otherwise permitted (or
 

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required) under this Agreement or (ii) upon terms no less favorable to the
Company or such Subsidiary, as applicable, than would be obtained in a
comparable arm’s-length transaction with a person that is not an Affiliate.
 
(b) The foregoing paragraph (a) shall not prohibit, to the extent otherwise
permitted under this Agreement,
 
(i) any issuance of securities, or other payments, awards or grants in cash,
securities or otherwise pursuant to, or the funding of, employment arrangements,
equity purchase agreements, stock options and stock ownership plans approved by
the Board of Directors of Holdings or of the Company,
 
(ii) loans or advances to employees or consultants of Holdings (or any Parent
Entity), the Company or any of the Subsidiaries in accordance with Section
6.04(e),
 
(iii) transactions among the Company or any Subsidiary or any entity that
becomes a Subsidiary as a result of such transaction (including via merger or
consolidation in which a Subsidiary is the surviving entity) not prohibited by
this Agreement,
 
(iv) the payment of fees, reasonable out-of-pocket costs and indemnities to
directors, officers, consultants and employees of Holdings, any Parent Entity,
the Company and the Subsidiaries in the ordinary course of business (limited, in
the case of any Parent Entity, to the portion of such fees and expenses that are
allocable to the Company and its Subsidiaries (which shall be 100% for so long
as Holdings or such Parent Entity, as the case may be, owns no assets other than
the Equity Interests in the Company, Holdings or another Parent Entity and
assets incidental to the ownership of the Company and its Subsidiaries)),
 
(v) subject to the limitations set forth in Section 6.07(b)(xiv), if applicable,
transactions pursuant to the Transaction Documents and permitted agreements in
existence on the Closing Date and set forth on Schedule 6.07 or any amendment
thereto to the extent such amendment is not adverse to the Lenders in any
material respect and other transactions, agreements and arrangements described
on Schedule 6.07 and any amendment thereto to the extent such amendment is not
adverse to the Lenders in any material respect or similar transactions,
agreements or arrangements entered into by the Company or any of its
Subsidiaries.
 
(vi) (A) any employment agreements entered into by the Company or any of the
Subsidiaries in the ordinary course of business, (B) any subscription agreement
or similar agreement pertaining to the repurchase of Equity Interests pursuant
to put/call rights or similar rights with employees, officers or directors, and
(C) any employee compensation, benefit plan or arrangement, any health,
disability or similar insurance plan which covers employees, and any reasonable
employment contract and transactions pursuant thereto,
 
(vii) dividends, redemptions and repurchases permitted under Section 6.06,
including payments to Holdings (and any Parent Entity),
 

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(viii) any purchase by Holdings of the equity capital of the Company; provided,
that any Equity Interests of the Company purchased by Holdings shall be pledged
to the Administrative Agent on behalf of the Lenders pursuant to the Collateral
Agreement,
 
(ix) payments by the Company or any of the Subsidiaries to any Fund or any Fund
Affiliate made for any financial advisory, financing, underwriting or placement
services or in respect of other investment banking activities, including in
connection with acquisitions or divestitures, which payments are approved by the
majority of the Board of Directors of the Company, or a majority of
disinterested members of the Board of Directors of the Company, in good faith,
 
(x) transactions with Wholly Owned Subsidiaries for the purchase or sale of
goods, products, parts and services entered into in the ordinary course of
business in a manner consistent with past practice,
 
(xi) any transaction in respect of which the Company delivers to the
Administrative Agent (for delivery to the Lenders) a letter addressed to the
Board of Directors of the Company from an accounting, appraisal or investment
banking firm, in each case of nationally recognized standing that is (A) in the
good faith determination of the Company qualified to render such letter and (B)
reasonably satisfactory to the Administrative Agent, which letter states that
such transaction is on terms that are no less favorable to the Company or such
Subsidiary, as applicable, than would be obtained in a comparable arm’s-length
transaction with a person that is not an Affiliate,
 
(xii) subject to paragraph (xiv) below, the payment of all fees, expenses,
bonuses and awards related to the Transactions contemplated by the Information
Memorandum, including fees to any Fund or any Fund Affiliates and as set forth
on Schedule 6.07,
 
(xiii) transactions with joint ventures for the purchase or sale of goods,
equipment and services entered into in the ordinary course of business and in a
manner consistent with past practice,
 
(xiv) any agreement to pay, and the payment of, monitoring, management,
transaction, advisory or similar fees payable to any Fund or any Fund Affiliate
(A) in an aggregate amount in any fiscal year not to exceed the sum of (1) the
greater of $7.5 million and 2.0% of EBITDA for such fiscal year, plus reasonable
out of pocket costs and expenses in connection therewith and unpaid amounts
accrued for prior periods; plus (2) any deferred fees (to the extent such fees
were within such amount in clause (A) (1) above originally), plus (B) 2.0% of
the value of transactions with respect to which any Fund or any Fund Affiliate
provides any transaction, advisory or other services, plus (C) so long as no
Availability Triggering Event or Event of Default has occurred and is
continuing, in the event of a Qualified IPO, the present value of all future
amounts payable pursuant to any agreement referred to in clause (A) (1) above in
connection with the termination of such agreement with the Funds and Fund
Affiliates (the “Fund Termination Fee”); provided, that if any such payment
pursuant to clause (C) is not permitted to be paid as a result of an
Availability Triggering Event or Event of Default,
 

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such payment shall accrue and may be payable when no Availability Triggering
Event or Events of Default are continuing to the extent that no further
Availability Triggering Event or Event of Default would result therefrom,
 
(xv) the issuance, sale, transfer of Equity Interests of Company to Holdings and
capital contributions by Holdings to Company,
 
(xvi) the Business Combination and all transactions in connection therewith, or
 
(xvii) without duplication of any amounts otherwise paid with respect to taxes,
payments by Holdings (and any Parent Entity), the Company and the Subsidiaries
pursuant to tax sharing agreements among Holdings (and any such Parent Entity),
the Company and the Subsidiaries on customary terms that require each party to
make payments when such taxes are due or refunds received of amounts equal to
the income tax liabilities and refunds generated by each such party calculated
on a separate return basis and payments to the party generating tax benefits and
credits of amounts equal to the value of such tax benefits and credits made
available to the group by such party.
 
SECTION 6.08. Business of the Borrowers and the Subsidiaries. Notwithstanding
any other provisions hereof, engage at any time in any business or business
activity other than any business or business activity conducted by any of them
on the Closing Date and any business or business activities incidental or
related thereto, or any business or activity that is reasonably similar or
complementary thereto or a reasonable extension, development or expansion
thereof or ancillary thereto.
 
SECTION 6.09. Limitation on Modifications of Indebtedness; Modifications of
Certificate of Incorporation, By-Laws and Certain Other Agreements;
etc. xxx)  Amend or modify in any manner materially adverse to the Lenders, or
grant any waiver or release under or terminate in any manner (if such granting
or termination shall be materially adverse to the Lenders), the articles or
certificate of incorporation, by-laws, limited liability company operating
agreement, partnership agreement or other organizational documents of the
Company or any of the Subsidiaries or the Merger Agreement.
 
(b) (a)  Make, or agree or offer to pay or make, directly or indirectly, any
payment or other distribution (whether in cash, securities or other property) of
or in respect of principal of or interest on the loans under the Senior
Subordinated Notes or any Permitted Refinancing Indebtedness in respect of the
Senior Subordinated Notes or any preferred Equity Interests or any Disqualified
Stock (“Junior Financing”), or any payment or other distribution (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination in respect of any Junior Financing except for (A)
Refinancings permitted by Section 6.01(l) or (r), (B) payments of regularly
scheduled interest, and, to the extent this Agreement is then in effect,
principal on the scheduled maturity date of any Junior Financing, (C) payments
or distributions in respect of all or any portion of the Junior Financing with
the proceeds contributed to the Company by Holdings from the issuance, sale or
exchange by Holdings (or any Parent Entity) of Equity Interests made within
eighteen months prior thereto, (D) the conversion of any Junior Financing to
Equity Interests of Holdings or any Parent Entity; and (E) so long as no Default
or
 

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Event of Default has occurred and is continuing or would result therefrom and
after giving effect to such payment or distribution the Company would be in Pro
Forma Compliance, payments or distributions in respect of Junior Financings
prior to their scheduled maturity made, in an aggregate amount, not to exceed
the sum of (x) $60 million and (y) the Cumulative Credit; or
 
(b) Amend or modify, or permit the amendment or modification of, any provision
of Junior Financing, or any agreement, document or instrument evidencing or
relating thereto, other than amendments or modifications that (A) are not in any
manner materially adverse to Lenders and that do not affect the subordination or
payment provisions thereof (if any) in a manner adverse to the Lenders and
(B) otherwise comply with the definition of “Permitted Refinancing
Indebtedness”.
 
(c) Permit any Material Subsidiary to enter into any agreement or instrument
that by its terms restricts (i) the payment of dividends or distributions or the
making of cash advances to the Company or any Subsidiary that is a direct or
indirect shareholder of such Subsidiary or (ii) the granting of Liens by the
Company or such Material Subsidiary pursuant to the Security Documents, in each
case other than those arising under any Loan Document, except, in each case,
restrictions existing by reason of:
 
1. restrictions imposed by applicable law;
 
2. contractual encumbrances or restrictions in effect on the Closing Date under
Indebtedness existing on the Closing Date and set forth on Schedule 6.01, the
Second Lien Notes, the Senior Subordinated Notes or any agreements related to
any Permitted Refinancing Indebtedness in respect of any such Indebtedness that
does not expand the scope of any such encumbrance or restriction;
 
3. any restriction on a Subsidiary imposed pursuant to an agreement entered into
for the sale or disposition of the Equity Interests or assets of a Subsidiary
pending the closing of such sale or disposition;
 
4. customary provisions in joint venture agreements and other similar agreements
applicable to joint ventures entered into in the ordinary course of business;
 
5. any restrictions imposed by any agreement relating to secured Indebtedness
permitted by this Agreement to the extent that such restrictions apply only to
the property or assets securing such Indebtedness;
 
6. any restrictions imposed by any agreement relating to Indebtedness incurred
pursuant to section 6.01(r), to the extent such restrictions are not more
restrictive, taken as a whole, than the restrictions contained in the Senior
Subordinated Note Documents and Second Lien Note Documents;
 
7. customary provisions contained in leases or licenses of intellectual property
and other similar agreements entered into in the ordinary course of business;
 

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8. customary provisions restricting subletting or assignment of any lease
governing a leasehold interest;
 
9. customary provisions restricting assignment of any agreement entered into in
the ordinary course of business;
 
10. customary restrictions and conditions contained in any agreement relating to
the sale, transfer, lease or other disposition of any asset permitted under
Section 6.05 pending the consummation of such sale, transfer, lease or other
disposition;
 
11. customary restrictions and conditions contained in the document relating to
any Lien, so long as (1) such Lien is a Permitted Lien and such restrictions or
conditions relate only to the specific asset subject to such Lien, and (2) such
restrictions and conditions are not created for the purpose of avoiding the
restrictions imposed by this Section 6.09;
 
12. customary net worth provisions contained in Real Property leases entered
into by Subsidiaries of the Company, so long as the Company has determined in
good faith that such net worth provisions would not reasonably be expected to
impair the ability of the Company and its Subsidiaries to meet their ongoing
obligations;
 
13. any agreement in effect at the time such subsidiary becomes a Subsidiary, so
long as such agreement was not entered into in contemplation of such person
becoming a Subsidiary other than Subsidiaries of such new Subsidiary;
 
14. restrictions in agreements representing Indebtedness permitted under Section
6.01 of a Subsidiary of the Company that is not a Subsidiary Loan Party;
 
15. customary restrictions on leases, subleases, licenses or Equity Interests or
asset sale agreements otherwise permitted hereby as long as such restrictions
relate to the Equity Interests and assets subject thereto;
 
16. restrictions on cash or other deposits imposed by customers under contracts
entered into in the ordinary course of business;
 
17. [Reserved]; or
 
(R) any encumbrances or restrictions of the type referred to in Sections
6.09(c)(i) and 6.09(c)(ii) above imposed by any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings of the contracts, instruments or obligations referred to in clauses
(A) through (Q) above; provided that such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings are, in the good faith judgment of the Company, no more restrictive
with respect to such dividend and other payment restrictions than those
contained in the dividend or other payment restrictions prior to such amendment,
modification, restatement, renewal, increase, supplement, refunding, replacement
or refinancing.
 

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SECTION 6.10. Fiscal Year; Accounting. Permit its fiscal year to end on any date
other than (a) September 30 or December 30 during the 2007 fiscal year, or (b)
the Saturday nearest the end of the calendar year in respect of any other year,
without prior notice to the Administrative Agent given concurrently with any
required notice to the SEC.
 
SECTION 6.11. Availability Triggering Event. If an Availability Triggering Event
or Event of Default shall have occurred and shall be continuing, permit the ABL
Fixed Charge Coverage Ratio, calculated as of the last day of the preceding
fiscal quarter for which financial statements have been delivered to the
Administrative Agent pursuant to Section 5.04(b), to be less than 1.00 to 1.00
(which calculation shall be made on a Pro Forma Basis to take into account any
events described in the definition of "Pro Forma Basis" occurring during the
period of four fiscal quarters ending on the last day of such preceding fiscal
quarter).
 
SECTION 6.12. Qualified CFC Holding Companies. Permit any Qualified CFC Holding
Company to (a) create, incur or assume any Indebtedness or other liability, or
create, incur, assume or suffer to exist any Lien on, or sell, transfer or
otherwise dispose of, other than in a transaction permitted under Section 6.05,
any of the Equity Interests of a Foreign Subsidiary held by such Qualified CFC
Holding Company, or any other assets, or (b) engage in any business or activity
or acquire or hold any assets other than the Equity Interests of one or more
Foreign Subsidiaries of the Company and/or one or more other Qualified CFC
Holding Companies and the receipt and distribution of dividends and
distributions in respect thereof.
 
 
ARTICLE VIA
 
 

 
 
Holdings Covenants
 
Holdings covenants and agrees with each Lender that, so long as this Agreement
shall remain in effect (other than in respect of contingent indemnification
obligations for which no claim has been made) and until the Commitments have
been terminated and the Obligations (including principal of and interest on each
Loan, all Fees and all other expenses or amounts payable under any Loan
Document) have been paid in full and all Letters of Credit and Bankers’
Acceptances have been canceled or fully cash collateralized (in a manner
reasonably acceptable to the Administrative Agent and the Issuing Banks) or have
expired and all amounts drawn or paid thereunder have been reimbursed in full,
unless the Required Lenders shall otherwise consent in writing, (a) Holdings
will not create, incur, assume or permit to exist any Lien (other than Liens of
a type described in Section 6.02(d), (e) or (k)) on any of the Equity Interests
issued by the Company other than the Liens created under the Loan Documents, (b)
Holdings shall do or cause to be done all things necessary to preserve, renew
and keep in full force and effect its legal existence; provided, that so long as
no Default or Event of Default exists or would result therefrom, Holdings may
merge with any other person, and (c) Holdings shall at all times own directly
100% of the Equity Interests of the Company and shall not sell, transfer or
otherwise dispose of the Equity Interests in the Company.
 

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ARTICLE VII
 

 
Events of Default
 
SECTION 7.01. Events of Default. In case of the happening of any of the
following events (each, an “Event of Default”):
 
(a) any representation or warranty made or deemed made by Holdings, any Borrower
or any other Loan Party herein or in any other Loan Document or any certificate
or document delivered pursuant hereto or thereto shall prove to have been false
or misleading in any material respect when so made or deemed made;
 
(b) default shall be made in the payment of any principal of any Loan when and
as the same shall become due and payable, whether at the due date thereof or at
a date fixed for prepayment thereof or by acceleration thereof or otherwise;
 
(c) default shall be made in the payment of any interest on any Loan or the
reimbursement with respect to any L/C Disbursement or in the payment of any Fee
or any other amount (other than an amount referred to in (b) above) due under
any Loan Document, when and as the same shall become due and payable, and such
default shall continue unremedied for a period of five Business Days;
 
(d) default shall be made in the due observance or performance by Holdings, any
Borrower or any of the Subsidiaries of any covenant, condition or agreement
contained in Section 5.01(a), 5.05(a) or 5.08 or in Article VI or VIA;
 
(e) default shall be made in the due observance or performance by Holdings, any
Borrower or any of the Subsidiaries of any covenant, condition or agreement
contained in (i) Section 5.07 or Sections 5.12 through 5.16 and such default
shall continue unremedied for a period of seven days after notice thereof from
the Administrative Agent to the Borrowers, or (ii) any Loan Document (other than
those specified in paragraphs (b), (c) and (d) above) and such default shall
continue unremedied for a period of 30 days (or 60 days if such default results
solely from a Foreign Subsidiary’s failure to duly observe or perform any such
covenant, condition or agreement) after notice thereof from the Administrative
Agent to the Company;
 
(f) (i) any event or condition occurs that (A) results in any Material
Indebtedness becoming due prior to its scheduled maturity or (B) enables or
permits (with all applicable grace periods having expired) the holder or holders
of any Material Indebtedness or any trustee or agent on its or their behalf to
cause any Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled maturity or
(ii) Holdings, any Borrower or any of the Subsidiaries shall fail to pay the
principal of any Material Indebtedness at the stated final maturity thereof;
provided, that this clause (f) shall not apply to secured Indebtedness that
becomes due as a result of the voluntary sale or transfer of the property or
assets securing such Indebtedness if such sale or transfer is permitted
hereunder and under the documents providing for such Indebtedness;
 

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(g) there shall have occurred a Change in Control;
 
(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed in a court of competent jurisdiction seeking (i) relief in
respect of Holdings, any Borrower or any of the Subsidiaries, or of a
substantial part of the property or assets of Holdings, any Borrower or any
Subsidiary, under Title 11 of the United States Code, as now constituted or
hereafter amended, or any other federal, state or foreign bankruptcy,
insolvency, receivership or similar law, (ii) the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for Holdings,
any Borrower or any of the Subsidiaries or for a substantial part of the
property or assets of Holdings, any Borrower or any of the Subsidiaries or (iii)
the winding-up or liquidation of Holdings, any Borrower or any Subsidiary
(except, in the case of any Subsidiary, in a transaction permitted by
Section 6.05); and such proceeding or petition shall continue undismissed for 60
days or an order or decree approving or ordering any of the foregoing shall be
entered;
 
(i) Holdings, any Borrower or any Subsidiary shall (i) voluntarily commence any
proceeding or file any petition seeking relief under Title 11 of the United
States Code, as now constituted or hereafter amended, or any other federal,
state or foreign bankruptcy, insolvency, receivership or similar law, (ii)
consent to the institution of, or fail to contest in a timely and appropriate
manner, any proceeding or the filing of any petition described in paragraph (h)
above, (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for Holdings, any
Borrower or any of the Subsidiaries or for a substantial part of the property or
assets of Holdings, any Borrower or any Subsidiary, (iv) file an answer
admitting the material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors or (vi)
become unable or admit in writing its inability or fail generally to pay its
debts as they become due;
 
(j) the failure by Holdings, any Borrower or any Subsidiary to pay one or more
final judgments aggregating in excess of $35 million (to the extent not covered
by insurance), which judgments are not discharged or effectively waived or
stayed for a period of 45 consecutive days;
 
(k) (i) a trustee shall be appointed by a United States district court to
administer any Plan, (ii) an ERISA Event or ERISA Events shall have occurred
with respect to any Plan or Multiemployer Plan, (iii) the PBGC shall institute
proceedings (including giving notice of intent thereof) to terminate any Plan or
Plans, (iv) Holdings, any Borrower or any Subsidiary or any ERISA Affiliate
shall have been notified by the sponsor of a Multiemployer Plan that such
Multiemployer Plan is in reorganization or is being terminated, within the
meaning of Title IV of ERISA, or (v) Holdings, any Borrower or any Subsidiary
shall engage in any “prohibited transaction” (as defined in Section 406 of ERISA
or Section 4975 of the Code) involving any Plan; and in each case in clauses (i)
through (v) above, such event or condition, together with all other such events
or conditions, if any, would reasonably be expected to have a Material Adverse
Effect;
 

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(l) (i) any Loan Document shall for any reason be asserted in writing by
Holdings, any Borrower or any Subsidiary not to be a legal, valid and binding
obligation of any party thereto, (ii) any security interest purported to be
created by any Security Document and to extend to assets that are not immaterial
to Holdings, the Borrowers and the Subsidiaries on a consolidated basis, shall
cease to be, or shall be asserted in writing by any Borrower or any other Loan
Party not to be, a valid and perfected security interest (perfected as or having
the priority required by this Agreement or the relevant Security Document and
subject to such limitations and restrictions as are set forth herein and
therein) in the securities, assets or properties covered thereby, except to the
extent that any such loss of perfection or priority results from the limitations
of foreign laws, rules and regulations as they apply to pledges of Equity
Interests in Foreign Subsidiaries or the application thereof, or from the
failure of the Administrative Agent to maintain possession of certificates
actually delivered to it representing securities pledged under the Collateral
Agreement or to file Uniform Commercial Code continuation statements or take the
actions described on Schedule 3.04 and except to the extent that such loss is
covered by a Lender’s title insurance policy and the Administrative Agent shall
be reasonably satisfied with the credit of such insurer, or (iii) the Guarantees
pursuant to the Security Documents by Holdings, any Borrower or the Subsidiary
Loan Parties of any of the Obligations shall cease to be in full force and
effect (other than in accordance with the terms thereof), or shall be asserted
in writing by Holdings or any Borrower or any Subsidiary Loan Party not to be in
effect or not to be legal, valid and binding obligations;
 
(m) (i) the Obligations shall fail to constitute “Senior Debt” (or the
equivalent thereof) and “Designated Senior Debt” (or the equivalent thereof)
under the Senior Subordinated Notes Indentures and under the documentation
governing any Indebtedness incurred pursuant to Section 6.01(r) constituting
subordinated Indebtedness or any Permitted Refinancing Indebtedness in respect
of the Senior Subordinated Notes or such Indebtedness incurred pursuant to
Section 6.01(r) constituting subordinated Indebtedness, or (ii) the
subordination provisions thereunder shall be invalidated or otherwise cease, or
shall be asserted in writing by Holdings, the Borrowers or any Subsidiary Loan
Party to be invalid or to cease to be legal, valid and binding obligations of
the parties thereto, enforceable in accordance with their terms; or
 
(n) there shall occur and be continuing an “Event of Default” under and as
defined in the Term Loan Credit Agreement.
 
then, and in every such event (other than an event with respect to any Borrower
described in paragraph (h) or (i) above), and at any time thereafter during the
continuance of such event, the Administrative Agent, at the request of the
Required Lenders, shall, by notice to the Company, take any or all of the
following actions, at the same or different times: (i) terminate forthwith the
Commitments, (ii) declare the Loans then outstanding to be forthwith due and
payable in whole or in part, whereupon the principal of the Loans so declared to
be due and payable, together with accrued interest thereon and any unpaid
accrued Fees and all other liabilities of the Borrowers accrued hereunder and
under any other Loan Document, shall become forthwith due and payable, without
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by the Borrowers, anything contained herein or in any
other Loan Document to the contrary notwithstanding and (iii) if the Loans have
been declared due and
 

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payable pursuant to clause (ii) above, demand cash collateral pursuant to
Section 2.05(j); and in any event with respect to any Borrower described in
paragraph (h) or (i) above, the Commitments shall automatically terminate, the
principal of the Loans then outstanding, together with accrued interest thereon
and any unpaid accrued Fees and all other liabilities of the Borrowers accrued
hereunder and under any other Loan Document, shall automatically become due and
payable and the Administrative Agent shall be deemed to have made a demand for
cash collateral to the full extent permitted under Section 2.05(j), without
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by the Borrowers, anything contained herein or in any
other Loan Document to the contrary notwithstanding.
 
SECTION 7.02. Exclusion of Immaterial Subsidiaries. Solely for the purposes of
determining whether an Event of Default has occurred under clause (h), (i) or
(l) of Section 7.01, any reference in any such clause to any Subsidiary shall be
deemed not to include any Immaterial Subsidiary affected by any event or
circumstance referred to in any such clause.
 
SECTION 7.03. Holdings’ Right to Cure. (2) Notwithstanding anything to the
contrary contained in Section 7.01, in the event that the Borrowers fail to
comply with the requirements of the ABL Fixed Charge Coverage Ratio set forth in
Section 6.11 hereof, until the expiration of the 10th day subsequent to the date
that the certificate calculating such ABL Fixed Charge Coverage Ratio is
required to be delivered pursuant to Section 5.04(c), Holdings shall have the
right to issue Permitted Cure Securities for cash or otherwise receive cash
contributions to the capital of Holdings, and, in each case, to contribute any
such cash to the capital of the Company (collectively, the “Cure Right”), and
upon the receipt by the Company of such cash (the “Cure Amount”) pursuant to the
exercise by Holdings of such Cure Right, such ABL Fixed Charge Coverage Ratio
shall be recalculated giving effect to the following pro forma adjustment:
 
(i) EBITDA shall be increased with respect to such applicable quarter and any
four-quarter period that contains such quarter, solely for the purpose of
measuring the ABL Fixed Charge Coverage Ratio and not for any other purpose
under this Agreement, by an amount equal to the Cure Amount; and
 
(ii) If, after giving effect to the foregoing pro forma adjustment, the
Borrowers shall then be in compliance with the requirements of the ABL Fixed
Charge Coverage Ratio set forth in Section 6.11 hereof, the Borrowers shall be
deemed to have satisfied the requirements of such Section 6.11 as of the
relevant date of determination with the same effect as though there had been no
failure to comply therewith at such date, and the applicable breach or default
of such Section 6.11 that had occurred shall be deemed cured for this purposes
of the Agreement.
 
(b) Notwithstanding anything herein to the contrary, (i) in each
four-fiscal-quarter period there shall be at least one fiscal quarter in which
the Cure Right is not exercised, (ii) in each eight-fiscal-quarter period, there
shall be a period of at least four consecutive fiscal quarters during which the
Cure Right is not exercised, and (iii) for purposes of this Section 7.03, the
Cure Amount shall be no greater than the amount required for purposes of
complying with Section 6.11.
 

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ARTICLE VIII
 

 
The Agents
 
SECTION 8.01. Appointment. (b) Each Lender (in its capacities as a Lender and
the Swingline Lender (if applicable) and on behalf of itself and its Affiliates
as potential counterparties to Swap Agreements) and each Issuing Bank (in such
capacities and on behalf of itself and its Affiliates as potential
counterparties to Swap Agreements) hereby irrevocably designates and appoints
(A) the Administrative Agent as the agent of such Lender under this Agreement
and the other Loan Documents, including as a Collateral Agent for such Lender
and the other Secured Parties (including the Term Loan Secured Parties) under
the Security Documents, and each such Lender irrevocably authorizes the
Administrative Agent, in such capacity, to take such action on its behalf under
the provisions of this Agreement and the other Loan Documents and to exercise
such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto
and (B) the Term Facility Collateral Agent as collateral agent for such lender
for purposes of the Security Documents. In addition, to the extent required
under the laws of any jurisdiction other than the United States, each of the
Lenders and the Issuing Banks hereby grants to the Administrative Agent any
required powers of attorney to execute any Security Document governed by the
laws of such jurisdiction on such Lender’s or Issuing Bank’s behalf.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent. Except as expressly otherwise
provided in this Agreement, the Administrative Agent shall have and may use its
sole discretion with respect to exercising or refraining from exercising any
discretionary rights or taking or refraining from taking any actions which such
Agent is expressly entitled to take or assert under this Agreement and the other
Loan Documents, including (a) the determination of the applicability of
ineligibility criteria and other determinations with respect to the calculation
of the Borrowing Base, (b) the making of Agent Advances pursuant to Section
2.04(d), and (c) the exercise of remedies pursuant to Section 7.01, and any
action so taken or not taken shall be deemed consented to by the Lenders.
 
(b) In furtherance of the foregoing, each Lender (in its capacities as a Lender
and the Swingline Lender (if applicable) and on behalf of itself and its
Affiliates as potential counterparties to Swap Agreements) and each Issuing Bank
(in such capacities and on behalf of itself and its Affiliates as potential
counterparties to Swap Agreements) hereby appoints and authorizes the Collateral
Agent to act as the agent of such Lender for purposes of acquiring, holding and
enforcing any and all Liens on Collateral granted by any of the Loan Parties to
secure any of the Obligations, together with such powers and discretion as are
reasonably incidental thereto and to enter into and take such action on its
behalf under the provisions of the Intercreditor Agreement and the Senior Lender
Intercreditor Agreement and to exercise such powers and perform such duties as
are expressly delegated to the Collateral Agent by the terms of the
Intercreditor Agreement and the Senior Lender Intercreditor Agreement, together
with such other powers as are reasonably incidental thereto. In this connection,
the Collateral Agent (and any Subagents appointed by the Collateral Agent
pursuant to Section 8.02 for purposes of
 

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holding or enforcing any Lien on the Collateral (or any portion thereof) granted
under the Security Documents, or for exercising any rights or remedies
thereunder at the direction of the Collateral Agent) shall be entitled to the
benefits of this Article VIII (including, without limitation, Section 8.07) as
though the Collateral Agent (and any such Subagents) were an “Agent” under the
Loan Documents, as if set forth in full herein with respect thereto.
 
(c) Each Lender (in its capacities as a Lender and the Swingline Lender (if
applicable) and on behalf of itself and its Affiliates as potential
counterparties to Swap Agreements) and each Issuing Bank (in such capacities and
on behalf of itself and its Affiliates as potential counterparties to Swap
Agreements) irrevocably authorizes each of the Administrative Agent and the
Collateral Agent, at its option and in its discretion, (i) to release any Lien
on any property granted to or held by the Collateral Agent under any Loan
Document (A) upon termination of the Commitments and payment in full of all
Obligations (other than contingent indemnification obligations) and the
expiration, termination or cash collateralization of all Letters of Credit and
Bankers’ Acceptances, (B) that is sold or to be sold as part of or in connection
with any sale permitted hereunder or under any other Loan Document, or (C) if
approved, authorized or ratified in writing in accordance with Section 9.08
hereof, (ii) to release any Guarantor from its obligations under the Loan
Documents if such person ceases to be a Subsidiary as a result of a transaction
permitted hereunder; and (iii) to subordinate any Lien on any property granted
to or held by the Collateral Agent under any Loan Document to the holder of any
Lien on such property that is permitted by Section 6.02(i) and (j). Upon request
by the Collateral Agent at any time, the Required Lenders will confirm in
writing the Collateral Agent’s authority to release its interest in particular
types or items of property, or to release any Guarantor from its obligations
under the Loan Documents.
 
(d) In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to any Loan Party, (i) the Administrative Agent
(irrespective of whether the principal of any 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 Company)
shall be entitled and empowered, by intervention in such proceeding or otherwise
(A) to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of any or all of the 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 Banks and the
Administrative Agent and any Subagents allowed in such judicial proceeding, and
(B) to collect and receive any monies or other property payable or deliverable
on any such claims and to distribute the same, and (ii) any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official in any
such judicial proceeding is hereby authorized by each Lender and Issuing Bank to
make such payments to the Administrative Agent and, if the Administrative Agent
shall consent to the making of such payments directly to the Lenders and the
Issuing Banks, 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 the Loan Documents. Nothing contained herein shall be
deemed to authorize the Administrative Agent to authorize or consent to or
accept or adopt on behalf of any Lender or Issuing Bank any plan of
reorganization, arrangement, adjustment or composition affecting the Obligations
or the rights of
 

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any Lender or Issuing Bank or to authorize the Administrative Agent to vote in
respect of the claim of any Lender or Issuing Bank in any such proceeding.
 
SECTION 8.02. Delegation of Duties. The Administrative Agent may execute any of
its duties under this Agreement and the other Loan Documents (including for
purposes of holding or enforcing any Lien on the Collateral (or any portion
thereof) by or through agents, employees or attorneys-in-fact and shall be
entitled to advice of counsel and other consultants or experts concerning all
matters pertaining to such duties. The Administrative Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care. The Administrative Agent may also from time
to time, when the Administrative Agent deems it to be necessary or desirable,
appoint one or more trustees, co-trustees, collateral co-agents, collateral
subagents or attorneys-in-fact (each, a “Subagent”) with respect to all or any
part of the Collateral; provided, that no such Subagent shall be authorized to
take any action with respect to any Collateral unless and except to the extent
expressly authorized in writing by the Administrative Agent. Should any
instrument in writing from the Borrowers or any other Loan Party be required by
any Subagent so appointed by the Administrative Agent to more fully or certainly
vest in and confirm to such Subagent such rights, powers, privileges and duties,
the Borrowers shall, or shall cause such Loan Party to, execute, acknowledge and
deliver any and all such instruments promptly upon request by the Administrative
Agent. If any Subagent, or successor thereto, shall die, become incapable of
acting, resign or be removed, all rights, powers, privileges and duties of such
Subagent, to the extent permitted by law, shall automatically vest in and be
exercised by the Administrative Agent until the appointment of a new Subagent.
The Administrative Agent shall not be responsible for the negligence or
misconduct of any agent, attorney-in-fact or Subagent that it selects in
accordance with the foregoing provisions of this Section 8.02 in the absence of
the Administrative Agent’s gross negligence or willful misconduct.
 
SECTION 8.03. Exculpatory Provisions. Neither any Agent or its Affiliates nor
any of their respective officers, directors, employees, agents,
attorneys-in-fact or affiliates shall be (a) liable for any action lawfully
taken or omitted to be taken by it or such person under or in connection with
this Agreement or any other Loan Document (except to the extent that any of the
foregoing are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from its or such person’s own gross
negligence or willful misconduct) or (b) responsible in any manner to any of the
Lenders for any recitals, statements, representations or warranties made by any
Loan Party or any officer thereof contained in this Agreement or any other Loan
Document or in any certificate, report, statement or other document referred to
or provided for in, or received by the Agents under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or for any failure of any Loan Party a party thereto to perform its
obligations hereunder or thereunder. The Agents shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of any Loan Party. 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, (x) the
Administrative Agent shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default or Event of Default has occurred and is
continuing, and (y) the Administrative Agent
 

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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 Borrowers or any of their Affiliates that is
communicated to or obtained by the person serving as the Administrative Agent or
any of its Affiliates in any capacity. The Administrative Agent shall be deemed
not to have knowledge of any Default or Event of Default unless and until
written notice describing such Default or Event of Default is given to the
Administrative Agent by the Borrowers, a Lender or an Issuing Bank. 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 or Event of Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan
Document or any other agreement, instrument or document, or the creation,
perfection or priority of any Lien purported to be created by the Security
Documents, (v) the value or the sufficiency of any Collateral, or (vi) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.
 
SECTION 8.04. Reliance by 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 electronic message, Internet or intranet website
posting or other distribution) or conversation 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 any Credit Event, that by its terms must be fulfilled to
the satisfaction of a Lender or any Issuing Bank, the Administrative Agent may
presume that such condition is satisfactory to such Lender or Issuing Bank
unless the Administrative Agent shall have received notice to the contrary from
such Lender or the Issuing Bank prior to such Credit Event. The Administrative
Agent may consult with legal counsel (including counsel to Holdings or the
Borrowers), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts. The Administrative Agent may
deem and treat the payee of any Note as the owner thereof for all purposes
unless a written notice of assignment, negotiation or transfer thereof shall
have been filed with the Administrative Agent. The Administrative Agent shall be
fully justified in failing or refusing to take any action under this Agreement
or any other Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders (or, if so specified by this Agreement, all
or other Lenders) as it deems appropriate or it shall first be indemnified to
its satisfaction by the Lenders against any and all liability and expense that
may be incurred by it by reason of taking or continuing to take any such action.
The Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Loan Documents in
accordance with a request of the Required Lenders (or, if so specified by this
Agreement, all or other Lenders), and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Loans.
 

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SECTION 8.05. Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
unless the Administrative Agent has received written notice from a Lender,
Holdings or the Borrowers referring to this Agreement, describing such Default
or Event of Default and stating that such notice is a “notice of default.” In
the event that the Administrative Agent receives such a notice, the
Administrative Agent shall give prompt notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Lenders (or, if
so specified by this Agreement, all or other Lenders); provided, that unless and
until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.
 
SECTION 8.06. Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by any Agent hereafter
taken, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by any
Agent to any Lender. Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon any Agent 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 analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party that may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
 
SECTION 8.07. Indemnification. The Lenders agree to indemnify each Agent and
each Issuing Bank in its capacity as such (to the extent not reimbursed by
Holdings or the Borrowers and without limiting the obligation of Holdings or the
Borrowers to do so), in the amount of its pro rata share (based on its aggregate
Revolving Facility Credit Exposure and unused Commitments hereunder; provided,
that the aggregate principal amount of Swingline Loans owing to the Swingline
Lender and of L/C - BA Disbursements owing to any Issuing Bank shall be
considered to be owed to the Revolving Lenders ratably in accordance with their
respective Revolving Facility Credit Exposure), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment
 

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of the Loans) be imposed on, incurred by or asserted against such Agent or such
Issuing Bank in any way relating to or arising out of the Commitments, this
Agreement, any of the other Loan Documents (including, without limitation, the
Intercreditor Agreement and the Senior Lender Intercreditor Agreement) or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent or
such Issuing Bank under or in connection with any of the foregoing; provided,
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements that are found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from such Agent’s
or such Issuing Bank’s gross negligence or willful misconduct. The failure of
any Lender to reimburse any Agent or any Issuing Bank, as the case may be,
promptly upon demand for its ratable share of any amount required to be paid by
the Lenders to such Agent or such Issuing Bank, as the case may be, as provided
herein shall not relieve any other Lender of its obligation hereunder to
reimburse such Agent or such Issuing Bank, as the case may be, for its ratable
share of such amount, but no Lender shall be responsible for the failure of any
other Lender to reimburse such Agent or such Issuing Bank, as the case may be,
for such other Lender’s ratable share of such amount. The agreements in this
Section shall survive the payment of the Loans and all other amounts payable
hereunder.
 
SECTION 8.08. Agent in Its Individual Capacity. Each Agent and its affiliates
may make loans to, accept deposits from, and generally engage in any kind of
business with any Loan Party as though such Agent were not an Agent. With
respect to its Loans made or renewed by it and with respect to any Letter of
Credit issued, or Letter of Credit or Swingline Loan participated in, by it,
each Agent shall have the same rights and powers under this Agreement and the
other Loan Documents as any Lender and may exercise the same as though it were
not an Agent, and the terms “Lender” and “Lenders” shall include each Agent in
its individual capacity.
 
SECTION 8.09. Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 10 days’ notice to the Lenders and the
Borrowers. If the Administrative Agent shall resign as Administrative Agent
under this Agreement and the other Loan Documents, then the Required Lenders
shall appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 7.01(b), (c),
(h) or (i) shall have occurred and be continuing) be subject to approval by the
Company (which approval shall not be unreasonably withheld or delayed),
whereupon such successor agent shall succeed to the rights, powers and duties of
the Administrative Agent, and the term “Administrative Agent” shall mean such
successor agent effective upon such appointment and approval, and the former
Administrative Agent’s rights, powers and duties as Administrative Agent shall
be terminated, without any other or further act or deed on the part of such
former Administrative Agent or any of the parties to this Agreement or any
holders of the Loans. If no successor agent has accepted appointment as
Administrative Agent by the date that is 10 days following a retiring
Administrative Agent’s notice of resignation, the retiring Administrative
Agent’s resignation shall nevertheless thereupon become effective, and the
retiring Administrative Agent shall, on behalf of the Lenders, appoint a
successor agent which shall (unless an Event of Default under Section 7.01(b),
(c), (h) or (i) shall have occurred and be continuing) be subject to approval by
the Company (which approval shall not be unreasonably withheld or delayed).
After any retiring Administrative Agent’s resignation as Administrative Agent,
the provisions of this Section 8.09 shall inure to its benefit as to any actions
taken or
 

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omitted to be taken by it while it was Administrative Agent under this Agreement
and the other Loan Documents.
 
SECTION 8.10. Agents and Arrangers. Neither the Syndication Agent, the
Documentation Agents nor any of the Joint Lead Arrangers shall have any duties
or responsibilities hereunder in its capacity as such.
 
SECTION 8.11. [Reserved]
 
SECTION 8.12. Field Audit and Examination Reports; Disclaimer by Lenders. By
signing this Agreement, each Lender:
 
(a) is deemed to have requested that the Collateral Agent furnish such Lender,
promptly after it becomes available, a copy of each field audit or examination
report (each a “Report” and collectively, “Reports”) prepared by or on behalf of
the Collateral Agent;
 
(b) expressly agrees and acknowledges that neither the Banks nor the Agents (i)
make any representation or warranty as to the accuracy of any Report, or (ii)
shall be liable for any information contained in any Report;
 
(c) expressly agrees and acknowledges that the Reports are not comprehensive
audits or examinations, that the Collateral Agent, a Bank, or other party
performing any audit or examination will inspect only specific information
regarding the Borrowers and will rely significantly upon the Borrowers’ books
and records, as well as on representations of the Borrowers’ personnel;
 
(d) agrees to keep all Reports confidential and strictly for its internal use,
and not to distribute except to its participants, or use any Report in any other
manner; and
 
(e) without limiting the generality of any other indemnification provision
contained in this Agreement, agrees: (i) to hold the Agents and any other Lender
preparing a Report harmless from any action the indemnifying Lender may take or
conclusion the indemnifying Lender may reach or draw from any Report in
connection with any loans or other credit accommodations that the indemnifying
Lender has made or may make to the Borrowers, or the indemnifying Lender’s
participation in, or the indemnifying Lender’s purchase of, a loan or loans of
the Borrowers; and (ii) to pay and protect, and indemnify, defend, and hold the
Agents and any such other Lender preparing a Report harmless from and against,
the claims, actions, proceedings, damages, costs, expenses, and other amounts
(including Attorney Costs) incurred by the Agents and any such other Lender
preparing a Report as the direct or indirect result of any third parties who
might obtain all or part of any Report through the indemnifying Lender.
 

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ARTICLE IX
 

 
Miscellaneous
 
SECTION 9.01. Notices; Communications. i) Except in the case of notices and
other communications expressly permitted to be given by telephone (and except as
provided in Section 9.01(b) below), all notices and other communications
provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail or sent by
telecopier as follows, and all notices and other communications expressly
permitted hereunder to be given by telephone shall be made to the applicable
telephone number, as follows:
 
(i) if to any Loan Party, the Administrative Agent, the Issuing Bank or the
Swingline Lender, to the address, telecopier number, electronic mail address or
telephone number specified for such person on Schedule 9.01; and
 
(ii) if to any other Lender, to the address, telecopier number, electronic mail
address or telephone number specified in its Administrative Questionnaire.
 
(b) Notices and other communications to the Lenders and the Issuing Bank
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 the Issuing Bank pursuant to Article II if such Lender or the
Issuing Bank, as applicable, has notified the Administrative Agent that it is
incapable of receiving notices under such Article by electronic communication.
The Administrative Agent or the Borrowers may, in its discretion, agree to
accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it, provided that approval of
such procedures may be limited to particular notices or communications.
 
(c) Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received. Notices sent
by telecopier shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next business day for the
recipient). Notices delivered through electronic communications to the extent
provided in Section 9.01(b) above shall be effective as provided in such Section
9.01(b).
 
(d) Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto.
 
(e) Documents required to be delivered pursuant to Section 5.04 (to the extent
any such documents are included in materials otherwise filed with the SEC) may
be delivered electronically (including as set forth in Section 9.17) and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Company posts such documents, or provides a link thereto on the Company’s
website on the Internet at the website address listed on Schedule 9.01, or (ii)
on which such documents are posted on
 

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the Company’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 (A) the Company shall deliver paper copies of such documents to the
Administrative Agent or any Lender that requests the Borrowers to deliver such
paper copies until a written request to cease delivering paper copies is given
by the Administrative Agent or such Lender, and (B) the Borrowers shall notify
the Administrative Agent and each Lender (by telecopier or electronic mail) of
the posting of any such documents and provide to the Administrative Agent by
electronic mail electronic versions (i.e., soft copies) of such documents.
Notwithstanding anything contained herein, in every instance the Borrowers shall
be required to provide paper copies of the certificates required by Section
5.04(c) to the Administrative Agent. Except for such certificates required by
Section 5.04(c), 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 Borrowers
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.
 
SECTION 9.02. Survival of Agreement. All covenants, agreements, representations
and warranties made by the Loan Parties herein, in the other Loan Documents and
in the certificates or other instruments prepared or delivered in connection
with or pursuant to this Agreement or any other Loan Document shall be
considered to have been relied upon by the Lenders and each Issuing Bank and
shall survive the making by the Lenders of the Loans, the execution and delivery
of the Loan Documents and the issuance of the Letters of Credit, regardless of
any investigation made by such persons or on their behalf, and shall continue in
full force and effect as long as the principal of or any accrued interest on any
Loan or L/C - BA Disbursement or any Fee or any other amount payable under this
Agreement or any other Loan Document is outstanding and unpaid or any Letter of
Credit is outstanding and so long as the Commitments have not been terminated.
Without prejudice to the survival of any other agreements contained herein,
indemnification and reimbursement obligations contained herein (including
pursuant to Sections 2.15, 2.17 and 9.05) shall survive the payment in full of
the principal and interest hereunder, the expiration of the Letters of Credit
and the termination of the Commitments or this Agreement.
 
SECTION 9.03. Binding Effect. This Agreement shall become effective when it
shall have been executed by Holdings, the Borrowers and the Administrative Agent
and when the Administrative Agent shall have been notified by each Lender (or
otherwise received evidence satisfactory to the Administrative Agent) that such
Lender has executed it, and thereafter shall be binding upon and inure to the
benefit of Holdings, the Borrowers, each Issuing Bank, the Administrative Agent
and each Lender and their respective permitted successors and assigns.
 
SECTION 9.04. Successors and Assigns. ii)  The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any affiliate of
the Issuing Bank that issues any Letter of Credit or Bankers’ Acceptance),
except that (i) the Borrowers may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of each
 

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Lender (and any attempted assignment or transfer by the Borrowers without such
consent shall be null and void) and (ii) no Lender may assign or otherwise
transfer its rights or obligations hereunder except in accordance with this
Section 9.04. Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any person (other than the parties hereto, their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), Participants (to the extent
provided in paragraph (c) of this Section 9.04), and, to the extent expressly
contemplated hereby, the Related Parties of each of the Agents, the Issuing Bank
and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement or the other Loan Documents.
 
(b) (a)  Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more assignees (each, an “Assignee”) all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitments and the Loans at the time owing to it) with the prior
written consent (such consent not to be unreasonably withheld) of:
 
(A) the Company; provided, that no consent of the Company shall be required for
an assignment to a Lender, an affiliate of a Lender, an Approved Fund (as
defined below) or, if an Event of Default under Sections 7.01(b), (c), (h) or
(i) has occurred and is continuing, any other person;
 
(B) the Administrative Agent; and
 
(C) the Issuing Bank and the Swingline Lender; provided, that no consent of the
Issuing Bank and the Swingline Lender shall be required for an assignment of all
or any portion of a Revolving Loan.
 
(ii) Assignments shall be subject to the following additional conditions:
 
(A) except in the case of an assignment to a Lender, an affiliate of a Lender or
an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Commitments or Loans, the amount of the Commitments or Loans
of the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Acceptance with respect to such assignment is delivered
to the Administrative Agent) shall not be less than $5 million, unless each of
the Company and the Administrative Agent otherwise consent; provided, that (1)
no such consent of the Company shall be required if an Event of Default under
Sections 7.01(b), (c), (h) or (i) has occurred and is continuing and (2) such
amounts shall be aggregated in respect of each Lender and its Affiliates or
Approved Funds (with simultaneous assignments to or by two or more Related Funds
shall be treated as one assignment), if any;
 
(B) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Acceptance via an electronic settlement
system acceptable to the Administrative Agent (or, if previously agreed with the
Administrative Agent, manually), and shall pay to the Administrative Agent a
processing and recordation fee of $3,500 (which fee may be waived or reduced in
the sole discretion of the Administrative Agent);
 

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(C) the Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire and all applicable tax
forms; and
 
(D) the Assignee shall not be a Borrower or any of the Borrowers’ Affiliates or
Subsidiaries.
 
For the purposes of this Section 9.04, “Approved Fund” means any person (other
than a natural person) that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the ordinary course
and that is administered or managed by (a) a Lender, (b) an Affiliate of a
Lender or (c) an entity or an Affiliate of an entity that administers or manages
a Lender. Notwithstanding the foregoing, no Lender shall be permitted to assign
or transfer any portion of its rights and obligations under this Agreement to an
Ineligible Institution.
 
(b) Subject to acceptance and recording thereof pursuant to paragraph (b)(v)
below, from and after the effective date specified in each Assignment and
Acceptance the Assignee thereunder shall be a party hereto and, to the extent of
the interest assigned by such Assignment and Acceptance, 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
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 2.15,
2.16, 2.17 and 9.05). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 9.04
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section 9.04.
 
(c) The Administrative Agent, acting for this purpose as an agent of the
Borrowers, shall maintain at one of its offices a copy of each Assignment and
Acceptance delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amount of the
Loans and Revolving L/C - BA Exposure owing to, each Lender pursuant to the
terms hereof from time to time (the “Register”). The entries in the Register
shall be conclusive, and the Borrowers, the Administrative Agent, the Issuing
Bank and the Lenders may treat each person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrowers, the Issuing Bank and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
 
(d) Upon its receipt of a duly completed Assignment and Acceptance executed by
an assigning Lender and an Assignee, the Assignee’s completed Administrative
Questionnaire (unless the Assignee shall already be a Lender hereunder), all
applicable tax forms, the processing and recordation fee referred to in
paragraph (b) of this Section and any written consent to such assignment
required by paragraph (b) of this Section, the Administrative Agent shall
promptly accept such Assignment and Acceptance and record the information
contained therein in the Register. No assignment, whether or not evidenced by a
promissory note, shall be effective for purposes of this Agreement unless it has
been recorded in the Register as provided in this paragraph (b)(v).
 

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(c) (e)  Any Lender may, without the consent of the Company or the
Administrative Agent, sell participations to one or more banks or other entities
(a “Participant”) in all or a portion of such Lender’s rights and obligations
under this Agreement (including all or a portion of its Commitments and the
Loans owing to it); provided, that (A) such Lender’s obligations under this
Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrowers, the Administrative Agent, the Issuing Bank and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement. Any
agreement pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and the
other Loan Documents and to approve any amendment, modification or waiver of any
provision of this Agreement and the other Loan Documents; provided, that (x)
such agreement may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver that (1) requires
the consent of each Lender directly affected thereby pursuant to
Section 9.04(a)(i) or clauses (i), (ii), (iii), (iv), (v) or (vi) of the first
proviso to Section 9.08(b) and (2) directly affects such Participant and (y) no
other agreement with respect to amendment, modification or waiver may exist
between such Lender and such Participant. Subject to paragraph (c)(ii) of this
Section 9.04, the Borrowers agree that each Participant shall be entitled to the
benefits of Sections 2.15, 2.16 and 2.17 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section 9.04. To the extent permitted by law, each Participant also shall
be entitled to the benefits of Section 9.06 as though it were a Lender, provided
such Participant shall be subject to Section 2.18(c) as though it were a Lender.
 
(f) A Participant shall not be entitled to receive any greater payment under
Section 2.15, 2.16 or 2.17 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Company’s
prior written consent. A Participant shall not be entitled to the benefits of
Section 2.17 to the extent such Participant fails to comply with Section 2.17(e)
and (f) as though it were a Lender.
 
(d) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including any pledge or assignment to secure obligations to a Federal
Reserve Bank, and this Section 9.04 shall not apply to any such pledge or
assignment of a security interest; provided, that no such pledge or assignment
of a security interest shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or Assignee for such Lender as a party
hereto.
 
(e) The Borrowers, upon receipt of written notice from the relevant Lender,
agree to issue Notes to any Lender requiring Notes to facilitate transactions of
the type described in paragraph (d) above.
 
(f) Notwithstanding the foregoing, any Conduit Lender may assign any or all of
the Loans it may have funded hereunder to its designating Lender without the
consent of the Company or the Administrative Agent. Each of Holdings, the
Borrowers, each Lender and the Administrative Agent hereby confirms that it will
not institute against a Conduit Lender or join any other person in instituting
against a Conduit Lender any bankruptcy, reorganization,
 

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arrangement, insolvency or liquidation proceeding under any state bankruptcy or
similar law, for one year and one day after the payment in full of the latest
maturing commercial paper note issued by such Conduit Lender; provided, however,
that each Lender designating any Conduit Lender hereby agrees to indemnify, save
and hold harmless each other party hereto and each Loan Party for any loss,
cost, damage or expense arising out of its inability to institute such a
proceeding against such Conduit Lender during such period of forbearance.
 
(g) If the Borrower wishes to replace the Loans or Commitments under the
Revolving Facility with ones having different terms, it shall have the option,
with the consent of the Administrative Agent and subject to at least three
Business Days’ advance notice to the Lenders under such Facility, instead of
prepaying the Loans or reducing or terminating the Commitments to be replaced,
to (i) require the Lenders under such Facility to assign such Loans or
Commitments to the Administrative Agent or its designees and (ii) amend the
terms thereof in accordance with Section 9.08 (with such replacement, if
applicable, being deemed to have been made pursuant to Section 9.08(d)).
Pursuant to any such assignment, all Loans and Commitments to be replaced shall
be purchased at par (allocated among the Lenders under such Facility in the same
manner as would be required if such Loans were being optionally prepaid or such
Commitments were being optionally reduced or terminated by the Borrowers),
accompanied by payment of any accrued interest and fees thereon and any other
amounts owing pursuant to Section 9.05(b). By receiving such purchase price, the
Lenders under such Facility shall automatically be deemed to have assigned the
Loans or Commitments under such Facility pursuant to the terms of the form of
Assignment and Acceptance attached hereto as Exhibit A, and accordingly no other
action by such Lenders shall be required in connection therewith. The provisions
of this paragraph (g) are intended to facilitate the maintenance of the
perfection and priority of existing security interests in the Collateral during
any such replacement.
 
(h) Notwithstanding the foregoing, no assignment may be made to an Ineligible
Institution without the prior written consent of the Borrower.
 
SECTION 9.05. Expenses; Indemnity. iii)  The Borrowers agree to pay (i) all
reasonable out-of-pocket expenses (including Other Taxes) incurred by the
Administrative Agent in connection with the preparation of this Agreement and
the other Loan Documents, or by the Administrative Agent in connection with the
syndication of the Commitments or the administration of this Agreement
(including expenses incurred in connection with due diligence to the extent
incurred with the reasonable prior approval of the Company and the reasonable
fees, disbursements and charges for no more than one counsel in each
jurisdiction where Collateral is located) or in connection with the
administration of this Agreement and any amendments, modifications or waivers of
the provisions hereof or thereof (whether or not the Transactions hereby
contemplated shall be consummated), including the reasonable fees, charges and
disbursements of Shearman & Sterling LLP, counsel to the Administrative Agent,
the Collateral Agent and the Joint Lead Arrangers, and, if necessary, the
reasonable fees, charges and disbursements of one local counsel per
jurisdiction; (ii) all reasonable out-of-pocket expenses incurred by the
Administrative Agent, the Collateral Agent or the Joint Lead Arrangers for (A)
the costs of appraisals, inspections and verifications of the Collateral,
including travel, lodging, and meals for inspections of the Collateral and the
Loan Parties’ operations by the Administrative Agent or the Collateral Agent,
plus the Administrative Agent’s then customary charge for field examinations and
audits and the preparation of reports thereof (such charge is
 

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currently $850 per day (or portion thereof) for each agent or employee of the
Administrative Agent with respect to each field examination or audit), (B) the
costs and expenses of forwarding loan proceeds, collecting checks, and other
items of payment, and establishing and maintaining Payment Accounts and lock
boxes, and (C) the costs and expenses of lien searches, taxes, fees and other
charges for filing financing statements, and other actions to maintain, preserve
and protect the Collateral and the Collateral Agent’s Lien thereon; provided,
that so long as no Default or Event of Default shall have occurred and be
continuing, such costs, expenses and charges described in clauses (A)-(C) shall
not exceed (x) $100,000 per year in any year that the Collateral Agent conducts
no more than one Collateral Audit and one appraisal of the Collateral and (y)
$150,000 per year in any year that the Collateral Agent conducts more than one
Collateral Audit and appraisal of the Collateral; (iii) sums paid or incurred to
pay any amount or take any action required of any Borrower or other Loan Party
under the Loan Documents that such Borrower or Loan Party fails to take; and
(iv) all out-of-pocket expenses (including Other Taxes) incurred by the
Administrative Agent or any Lender in connection with the enforcement or
protection of their rights in connection with this Agreement and the other Loan
Documents, in connection with the Loans made or the Letters of Credit issued
hereunder, including the fees, charges and disbursements of counsel for the
Administrative Agent (including any special and local counsel).
 
(b) The Borrowers agree to indemnify the Administrative Agent, the Collateral
Agent, the Joint Lead Arrangers, each Issuing Bank, each Lender, each of their
respective Affiliates and each of their respective directors, trustees,
officers, employees, agents, trustees and advisors (each such person being
called an “Indemnitee”) against, and to hold each Indemnitee harmless from, any
and all losses, claims, damages, liabilities and related expenses, including
reasonable counsel fees, charges and disbursements (except the allocated costs
of in-house counsel), incurred by or asserted against any Indemnitee arising out
of, in any way connected with, or as a result of (i) the execution or delivery
of this Agreement or any other Loan Document (including, without limitation, the
Intercreditor Agreement and the Senior Lender Intercreditor Agreement) or any
agreement or instrument contemplated hereby or thereby, the performance by the
parties hereto and thereto of their respective obligations thereunder or the
consummation of the Transactions and the other transactions contemplated hereby,
(ii) the use of the proceeds of the Loans or the use of any Letter of Credit or
Bankers’ Acceptance or (iii) any claim, litigation, investigation or proceeding
relating to any of the foregoing, whether or not any Indemnitee is a party
thereto and regardless of whether such matter is initiated by a third party or
by Holdings, the Borrowers or any of their subsidiaries or Affiliates; provided,
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined by a final, non-appealable judgment of a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
such Indemnitee (for purposes of this proviso only, each of the Administrative
Agent, the Joint Lead Arrangers, any Issuing Bank or any Lender shall be treated
as several and separate Indemnitees, but each of them together with its
respective Related Parties, shall be treated as a single Indemnitee). Subject to
and without limiting the generality of the foregoing sentence, the Borrowers
agree to indemnify each Indemnitee against, and hold each Indemnitee harmless
from, any and all losses, claims, damages, liabilities and related expenses,
including reasonable counsel or consultant fees, charges and disbursements
(limited to not more than one counsel, plus, if necessary, one local counsel per
jurisdiction) (except the allocated costs of in-house counsel), incurred by or
asserted against any Indemnitee arising out
 

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of, in any way connected with, or as a result of (A) any claim related in any
way to Environmental Laws and Holdings, any Borrower or any of their
Subsidiaries, or (B) any actual or alleged presence, Release or threatened
Release of Hazardous Materials at, under, on or from any Property; provided,
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee or any of its Related Parties. None of the Indemnitees (or any
of their respective affiliates) shall be responsible or liable to the Fund,
Holdings, the Borrowers or any of their respective subsidiaries, Affiliates or
stockholders or any other person or entity for any special, indirect,
consequential or punitive damages, which may be alleged as a result of the
Facility or the Transactions. The provisions of this Section 9.05 shall remain
operative and in full force and effect regardless of the expiration of the term
of this Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Obligations, the invalidity or unenforceability of any
term or provision of this Agreement or any other Loan Document, or any
investigation made by or on behalf of the Administrative Agent, any Issuing Bank
or any Lender. All amounts due under this Section 9.05 shall be payable on
written demand therefor accompanied by reasonable documentation with respect to
any reimbursement, indemnification or other amount requested.
 
(c) Except as expressly provided in Section 9.05(a) with respect to Other Taxes,
which shall not be duplicative with any amounts paid pursuant to Section 2.17,
this Section 9.05 shall not apply to Taxes.
 
(d) To the fullest extent permitted by applicable law, Holdings and the
Borrowers shall not assert, and hereby waive, 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 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) The agreements in this Section 9.05 shall survive the resignation of the
Administrative Agent, any Issuing Bank, the replacement of any Lender, the
termination of the Commitments and the repayment, satisfaction or discharge of
all the other Obligations and the termination of this Agreement.
 
SECTION 9.06. Right of Set-off. If an Event of Default shall have occurred and
be continuing, each Lender and each Issuing Bank is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender or such Issuing Bank to or for the credit or the account of Holdings, the
Borrowers or any Subsidiary against any of and all the obligations of Holdings
or the Borrowers now or hereafter existing under this Agreement or any other
Loan Document held by such Lender or such Issuing Bank, irrespective of whether
or not such Lender or such Issuing
 

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Bank shall have made any demand under this Agreement or such other Loan Document
and although the obligations may be unmatured. The rights of each Lender and
each Issuing Bank under this Section 9.06 are in addition to other rights and
remedies (including other rights of set-off) that such Lender or such Issuing
Bank may have.
 
SECTION 9.07. Applicable Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER
THAN LETTERS OF CREDIT AND AS EXPRESSLY SET FORTH IN OTHER LOAN DOCUMENTS) SHALL
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK.
 
SECTION 9.08. Waivers; Amendment. iv)  No failure or delay of the Administrative
Agent, any Issuing Bank or any Lender in exercising any right or power hereunder
or under any Loan Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, each Issuing Bank and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or any other Loan Document or consent to any
departure by Holdings, any Borrower or any other Loan Party therefrom shall in
any event be effective unless the same shall be permitted by paragraph (b)
below, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice or demand on Holdings,
any Borrower or any other Loan Party in any case shall entitle such person to
any other or further notice or demand in similar or other circumstances.
 
(b) Neither this Agreement nor any other Loan Document nor any provision hereof
or thereof may be waived, amended or modified except (x) as provided in Section
2.21, (y) in the case of this Agreement, pursuant to an agreement or agreements
in writing entered into by Holdings, the Borrowers and the Required Lenders, and
(z) in the case of any other Loan Document, pursuant to an agreement or
agreements in writing entered into by each party thereto and the Administrative
Agent (or, in the case of any Security Documents, the Collateral Agent if so
provided therein) and consented to by the Required Lenders; provided, however,
that no such agreement shall
 
(i) decrease or forgive the principal amount of, or extend the final maturity
of, or decrease the rate of interest on, any Loan or any L/C - BA Disbursement,
or extend the stated expiration of any Letter of Credit or Bankers’ Acceptance
beyond the Revolving Facility Maturity Date, without the prior written consent
of each Lender directly affected thereby, except as provided in Section 2.05(c),
 
(ii) increase or extend the Commitment of any Lender or decrease the Commitment
Fees or L/C-BA Participation Fees or other fees of any Lender without the prior
written consent of such Lender (it being understood that waivers or
modifications of conditions precedent, covenants, Defaults or Events of Default
or of a mandatory reduction in the aggregate Commitments shall not constitute an
increase of the Commitments of any Lender),
 

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(iii) extend any date on which payment of interest on any Loan or any L/C - BA
Disbursement or any Fees is due, without the prior written consent of each
Lender adversely affected thereby,
 
(iv) amend the provisions of Section 5.02 of the Collateral Agreement in a
manner that would by its terms alter the pro rata sharing of payments required
thereby, without the prior written consent of each Lender adversely affected
thereby,
 
(v) amend or modify the provisions of this Section 9.08 or the definition of the
term “Required Lenders” or any other provision hereof specifying the number or
percentage of Lenders required to waive, amend or modify any rights hereunder or
make any determination or grant any consent hereunder, without the prior written
consent of each Lender adversely affected thereby (it being understood that,
with the consent of the Required Lenders, additional extensions of credit
pursuant to this Agreement may be included in the determination of the Required
Lenders on substantially the same basis as the Loans and Commitments are
included on the Closing Date),
 
(vi) release all or substantially all the Collateral or release any of Holdings,
the Company or all or substantially all of the Subsidiary Loan Parties from
their respective Guarantees under the Collateral Agreement, unless, in the case
of a Subsidiary Loan Party, all or substantially all the Equity Interests of
such Subsidiary Loan Party is sold or otherwise disposed of in a transaction
permitted by this Agreement, without the prior written consent of each Lender,
 
(vii) increase any of the percentages set forth in the definition of the
Borrowing Base without the consent of all of the Lenders; or
 
(viii)  increase the Incremental Revolving Facility Commitment above $150
million or add any other Indebtedness under the Facility without the prior
written consent of each Lender;
 
provided, further, that no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent or an Issuing Bank
hereunder without the prior written consent of the Administrative Agent or such
Issuing Bank acting as such at the effective date of such agreement, as
applicable. Each Lender shall be bound by any waiver, amendment or modification
authorized by this Section 9.08 and any consent by any Lender pursuant to this
Section 9.08 shall bind any assignee of such Lender.
 
(c) Without the consent of the Syndication Agent, the Documentation Agent or any
Joint Lead Arranger or any Lender or Issuing Bank, the Loan Parties and the
Administrative Agent may (in their respective sole discretion, or shall, to the
extent required by any Loan Document) enter into any amendment, modification or
waiver of any Loan Document, or enter into any new agreement or instrument, to
effect the granting, perfection, protection, expansion or enhancement of any
security interest in any Collateral or additional property to become Collateral
for the benefit of the Secured Parties, or as required by local law to give
effect to, or protect any security interest for the benefit of the Secured
Parties, in any property or so that the security interests therein comply with
applicable law.
 

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(d) Notwithstanding the foregoing, this Agreement may be amended (or amended and
restated) with the written consent of the Required Lenders, the Administrative
Agent, Holdings and the Borrowers (i) to add one or more additional credit
facilities to this Agreement and to permit the extensions of credit from time to
time outstanding thereunder and the accrued interest and fees in respect thereof
to share ratably in the benefits of this Agreement and the other Loan Documents
with the Revolving Loans and the accrued interest and fees in respect thereof
and (ii) to include appropriately the Lenders holding such credit facilities in
any determination of the Required Lenders.
 
(e) Notwithstanding the foregoing, technical and conforming modifications to the
Loan Documents may be made with the consent of the Borrowers and the
Administrative Agent to the extent necessary to integrate any Incremental
Revolving Facility Commitments on substantially the same basis as the Revolving
Loans.
 
SECTION 9.09. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the applicable interest rate, together with all fees
and charges that are treated as interest under applicable law (collectively, the
“Charges”), as provided for herein or in any other document executed in
connection herewith, or otherwise contracted for, charged, received, taken or
reserved by any Lender or any Issuing Bank, shall exceed the maximum lawful rate
(the “Maximum Rate”) that may be contracted for, charged, taken, received or
reserved by such Lender in accordance with applicable law, the rate of interest
payable hereunder, together with all Charges payable to such Lender or such
Issuing Bank, shall be limited to the Maximum Rate; provided, that such excess
amount shall be paid to such Lender or such Issuing Bank on subsequent payment
dates to the extent not exceeding the legal limitation.
 
SECTION 9.10. Entire Agreement. This Agreement, the other Loan Documents and the
agreements regarding certain Fees referred to herein constitute the entire
contract between the parties relative to the subject matter hereof. Any previous
agreement among or representations from the parties or their Affiliates with
respect to the subject matter hereof is superseded by this Agreement and the
other Loan Documents. Notwithstanding the foregoing, the Fee Letter shall
survive the execution and delivery of this Agreement and remain in full force
and effect. Nothing in this Agreement or in the other Loan Documents, expressed
or implied, is intended to confer upon any party other than the parties hereto
and thereto any rights, remedies, obligations or liabilities under or by reason
of this Agreement or the other Loan Documents.
 
SECTION 9.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.
 

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SECTION 9.12. Severability. In the event any one or more of the provisions
contained in this Agreement or in any other Loan Document should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby. The parties shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.
 
SECTION 9.13. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original but all of which, when
taken together, shall constitute but one contract, and shall become effective as
provided in Section 9.03. Delivery of an executed counterpart to this Agreement
by facsimile transmission (or other electronic transmission pursuant to
procedures approved by the Administrative Agent) shall be as effective as
delivery of a manually signed original.
 
SECTION 9.14. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
 
SECTION 9.15. Jurisdiction; Consent to Service of Process. v)  Each of the
parties hereto hereby irrevocably and unconditionally submits, for itself and
its property, to the nonexclusive jurisdiction of any New York State court or
federal court of the United States of America sitting in New York City, and any
appellate court from any thereof (collectively, “New York Courts”), in any
action or proceeding arising out of or relating to this Agreement or the other
Loan Documents, or for recognition or enforcement of any judgment, and each of
the parties hereto hereby irrevocably and unconditionally agrees that all claims
in respect of any such action or proceeding may be heard and determined in such
New York State or, to the extent permitted by law, in such federal court. Each
of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that any party may otherwise have to bring any
action or proceeding relating to this Agreement or any of the other Loan
Documents in the courts of any jurisdiction, except that each of the Loan
Parties agrees that (a) it will not bring any such action or proceeding in any
court other than New York Courts (it being acknowledged and agreed by the
parties hereto that any other forum would be inconvenient and inappropriate in
view of the fact that more of the Lenders who would be affected by any such
action or proceeding have contacts with the State of New York than any other
jurisdiction), and (b) in any such action or proceeding brought against any Loan
Party in any other court, it will not assert any cross-claim, counterclaim or
setoff, or seek any other affirmative relief, except to the extent that the
failure to assert the same will preclude such Loan Party from asserting or
seeking the same in the New York Courts.
 
(b) Each of the parties hereto hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or the other Loan
Documents in any New York State or federal court. Each of
 

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the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
 
SECTION 9.16. Confidentiality. Each of the Lenders, each Issuing Bank and each
of the Agents agrees that it shall maintain in confidence any information
relating to Holdings, the Borrowers and any Subsidiary furnished to it by or on
behalf of Holdings, the Borrowers or any Subsidiary (other than information that
(a) has become generally available to the public other than as a result of a
disclosure by such party, (b) has been independently developed by such Lender,
such Issuing Bank or such Agent without violating this Section 9.16 or (c) was
available to such Lender, such Issuing Bank or such Agent from a third party
having, to such person’s knowledge, no obligations of confidentiality to
Holdings, the Borrowers or any other Loan Party) and shall not reveal the same
other than to its directors, trustees, officers, employees and advisors with a
need to know or to any person that approves or administers the Loans on behalf
of such Lender (so long as each such person shall have been instructed to keep
the same confidential in accordance with this Section 9.16), except: (A) to the
extent necessary to comply with law or any legal process or the requirements of
any Governmental Authority, the National Association of Insurance Commissioners
or of any securities exchange on which securities of the disclosing party or any
Affiliate of the disclosing party are listed or traded, (B) as part of normal
reporting or review procedures to, or examinations by, Governmental Authorities
or self-regulatory authorities, including the National Association of Insurance
Commissioners or the National Association of Securities Dealers, Inc., (C) to
its parent companies, Affiliates or auditors (so long as each such person shall
have been instructed to keep the same confidential in accordance with this
Section 9.16), (D) in order to enforce its rights under any Loan Document in a
legal proceeding, (E) to any pledge under Section 9.04(d) or any other
prospective assignee of, or prospective Participant in, any of its rights under
this Agreement (so long as such person shall have been instructed to keep the
same confidential in accordance with this Section 9.16) and (F) to any direct or
indirect contractual counterparty in Swap Agreements or such contractual
counterparty’s professional advisor (so long as such contractual counterparty or
professional advisor to such contractual counterparty agrees to be bound by the
provisions of this Section 9.16).
 
SECTION 9.17. Platform; Borrower Materials. The Borrowers hereby acknowledge
that (a) the Administrative Agent and/or the Joint Lead Arrangers will make
available to the Lenders and the Issuing Bank materials and/or information
provided by or on behalf of the Borrowers hereunder (collectively, “Borrower
Materials”) by posting the Borrower Materials on IntraLinks 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 Borrowers or their securities) (each,
a “Public Lender”). Each Borrower hereby agrees that it will use commercially
reasonable efforts to identify that portion of the Borrower Materials that may
be distributed to the Public Lenders and that (i) 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,
(ii) by marking Borrower Materials “PUBLIC,” the Borrowers shall be deemed to
have authorized the Administrative Agent, the Joint Lead Arrangers, the Issuing
Bank and the Lenders to treat such Borrower Materials as either publicly
available information or not material information (although it may be sensitive
and proprietary) with respect to the Borrowers or their
 

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securities for purposes of United States Federal and state securities laws,
(iii) all Borrower Materials marked “PUBLIC” are permitted to be made available
through a portion of the Platform designated “Public Investor;” and (iv) the
Administrative Agent and the Joint Lead Arrangers 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.”
 
SECTION 9.18. Release of Liens and Guarantees. In the event that any Loan Party
conveys, sells, leases, assigns, transfers or otherwise disposes of all or any
portion of any of the Equity Interests or assets of any Subsidiary Loan Party to
a person that is not (and is not required to become) a Loan Party in a
transaction not prohibited by Section 6.05, the Collateral Agent shall promptly
(and the Lenders hereby authorize the Collateral Agent to) take such action and
execute any such documents as may be reasonably requested by Holdings or the
Borrowers and at the Borrowers’ expense to release any Liens created by any Loan
Document in respect of such Equity Interests or assets, and, in the case of a
disposition of the Equity Interests of any Subsidiary Loan Party in a
transaction permitted by Section 6.05 and as a result of which such Subsidiary
Loan Party would cease to be a Subsidiary, terminate such Subsidiary Loan
Party’s obligations under its Guarantee. In addition, the Collateral Agent
agrees to take such actions as are reasonably requested by Holdings or the
Borrowers and at the Borrowers’ expense to terminate the Liens and security
interests created by the Loan Documents when all the Obligations (other than
contingent indemnification Obligations with respect to which no claim has been
made) are paid in full and all Letters of Credit and Commitments are terminated.
Any representation, warranty or covenant contained in any Loan Document relating
to any such Equity Interests, asset or subsidiary of Holdings shall no longer be
deemed to be made once such Equity Interests or asset is so conveyed, sold,
leased, assigned, transferred or disposed of.
 
SECTION 9.19. Judgment Currency. If, for the purposes of obtaining judgment in
any court, it is necessary to convert a sum due hereunder or any other Loan
Document in one currency into another currency, the rate of exchange used shall
be that at which in accordance with normal banking procedures the Administrative
Agent could purchase the first currency with such other currency on the Business
Day preceding that on which final judgment is given. The obligation of the
Borrowers in respect of any such sum due from it to the Administrative Agent or
the Lenders hereunder or under the other Loan Documents shall, notwithstanding
any judgment in a currency (the “Judgment Currency”) other than that in which
such sum is denominated in accordance with the applicable provisions of this
Agreement (the “Agreement Currency”), be discharged only to the extent that on
the Business Day following receipt by the Administrative Agent of any sum
adjudged to be so due in the Judgment Currency, the Administrative Agent may in
accordance with normal banking procedures purchase the Agreement Currency with
the Judgment Currency. If the amount of the Agreement Currency so purchased is
less than the sum originally due to the Administrative Agent from any Borrower
in the Agreement Currency, such Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Administrative Agent or the
Person to whom such obligation was owing against such loss. If the amount of the
Agreement Currency so purchased is greater than the sum originally due to the
Administrative Agent in such currency, the Administrative Agent agrees to return
the amount of any excess to such Borrower (or to any other Person who may be
entitled thereto under applicable law).
 

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SECTION 9.20. USA PATRIOT Act Notice. Each Lender that is subject to the Act (as
hereinafter defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrowers that pursuant to the requirements
of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”), it is required to obtain, verify and record information that
identifies each Loan Party, which information includes the name and address of
each Loan Party and other information that will allow such Lender or the
Administrative Agent, as applicable, to identify each Loan Party in accordance
with the Act.
 
SECTION 9.21. Joint and Several Liability. All Revolving Loans, upon funding,
shall be deemed to be jointly funded to and received by the Borrowers. Each
Borrower jointly and severally agrees to pay, and shall be jointly and severally
liable under this Agreement for, all Obligations, regardless of the manner or
amount in which proceeds of Revolving Loans are used, allocated, shared, or
disbursed by or among the Borrowers themselves, or the manner in which an Agent
and/or any Lender accounts for such Revolving Loans or other extensions of
credit on its books and records. Each Borrower shall be liable for all amounts
due to an Agent and/or any Lender under this Agreement, regardless of which
Borrower actually receives Revolving Loans or other extensions of credit
hereunder or the amount of such Revolving Loans and extensions of credit
received or the manner in which such Agent and/or such Lender accounts for such
Revolving Loans or other extensions of credit on its books and records. Each
Borrower’s Obligations with respect to Revolving Loans and other extensions of
credit made to it, and such Borrower’s Obligations arising as a result of the
joint and several liability of such Borrower hereunder, with respect to Loans
made to the other Borrowers hereunder, shall be separate and distinct
obligations, but all such Obligations shall be primary obligations of such
Borrower. The Borrowers acknowledge and expressly agree with the Agents and each
Lender that the joint and several liability of each Borrower is required solely
as a condition to, and is given solely as inducement for and in consideration
of, credit or accommodations extended or to be extended under the Loan Documents
to any or all of the other Borrowers and is not required or given as a condition
of extensions of credit to such Borrower. Each Borrower’s obligations under this
Agreement and as an obligor under a Guaranty Agreement shall be separate and
distinct obligations. Each Borrower’s obligations under this Agreement shall, to
the fullest extent permitted by law, be unconditional irrespective of (i) the
validity or enforceability, avoidance, or subordination of the Obligations of
any other Borrower or of any promissory note or other document evidencing all or
any part of the Obligations of any other Borrower, (ii) the absence of any
attempt to collect the Obligations from any other Borrower, any Guarantor, or
any other security therefor, or the absence of any other action to enforce the
same, (iii) the waiver, consent, extension, forbearance, or granting of any
indulgence by an Agent and/or any Lender with respect to any provision of any
instrument evidencing the Obligations of any other Borrower or Guarantor, or any
part thereof, or any other agreement now or hereafter executed by any other
Borrower or Guarantor and delivered to an Agent and/or any Lender, (iv) the
failure by an Agent and/or any Lender to take any steps to perfect and maintain
its security interest in, or to preserve its rights to, any security or
collateral for the Obligations of any other Borrower or Guarantor, (v) an
Agent’s and/or any Lender’s election, in any proceeding instituted under the
Bankruptcy Code, of the application of Section 1111(b)(2) of the Bankruptcy
Code, (vi) any borrowing or grant of a security interest by any other Borrower,
as debtor-in-possession under Section 364 of the Bankruptcy Code, (vii) the
disallowance of all or any portion of an Agent’s and/or any Lender’s claim(s)
for the repayment of the Obligations of any other Borrower under Section 502 of
the Bankruptcy Code, or (viii) any other circumstances which might constitute a
legal or
 

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equitable discharge or defense of a guarantor or of any other Borrower. With
respect to any Borrower’s Obligations arising as a result of the joint and
several liability of the Borrowers hereunder with respect to Revolving Loans or
other extensions of credit made to any of the other Borrowers hereunder, such
Borrower waives, until the Obligations shall have been paid in full and this
Agreement shall have been terminated, any right to enforce any right of
subrogation or any remedy which an Agent and/or any Lender now has or may
hereafter have against any other Borrower, any endorser or any guarantor of all
or any part of the Obligations, and any benefit of, and any right to participate
in, any security or collateral given to an Agent and/or any Lender to secure
payment of the Obligations or any other liability of any Borrower to an Agent
and/or any Lender. Upon any Event of Default, the Agents may proceed directly
and at once, without notice, against any Borrower to collect and recover the
full amount, or any portion of the Obligations, without first proceeding against
any other Borrower or any other Person, or against any security or collateral
for the Obligations. Each Borrower consents and agrees that the Agents shall be
under no obligation to marshal any assets in favor of any Borrower or against or
in payment of any or all of the Obligations. Notwithstanding anything to the
contrary provided herein, until the consummation of the merger of Covalence with
and into Berry, with Berry surviving, the amount of Obligations deemed funded to
Berry and each of the Borrowers that are subsidiaries of Berry, and the amount
of Obligations for which such Borrowers agree to pay and for which they shall be
liable shall be limited to the amount of such Obligations that such entities may
incur pursuant to the proviso of Section 4.03(a) of each of the Berry Senior
Subordinated Notes Indenture and the Second Lien Notes Indenture.
 
SECTION 9.22. Contribution and Indemnification among the Borrowers. Each
Borrower is obligated to repay the Obligations as joint and several obligor
under this Agreement. To the extent that any Borrower shall, under this
Agreement as a joint and several obligor, repay any of the Obligations
constituting Revolving Loans made to another Borrower hereunder or other
Obligations incurred directly and primarily by any other Borrower (an
“Accommodation Payment”), then the Borrower making such Accommodation Payment
shall be entitled to contribution and indemnification from, and be reimbursed
by, each of the other Borrowers in an amount, for each of such other Borrowers,
equal to a fraction of such Accommodation Payment, the numerator of which
fraction is such other Borrower’s Allocable Amount (as defined below) and the
denominator of which is the sum of the Allocable Amounts of all of the
Borrowers. As of any date of determination, the “Allocable Amount” of each
Borrower shall be equal to the maximum amount of liability for Accommodation
Payments which could be asserted against such Borrower hereunder without (a)
rendering such Borrower “insolvent” within the meaning of Section 101 (31) of
the Bankruptcy Code, Section 2 of the Uniform Fraudulent Transfer Act (“UFTA”)
or Section 2 of the Uniform Fraudulent Conveyance Act (“UFCA”), (b) leaving such
Borrower with unreasonably small capital or assets, within the meaning of
Section 548 of the Bankruptcy Code, Section 4 of the UFTA, or Section 5 of the
UFCA, or (c) leaving such Borrower unable to pay its debts as they become due
within the meaning of Section 548 of the Bankruptcy Code or Section 4 of the
UFTA, or Section 5 of the UFCA. All rights and claims of contribution,
indemnification, and reimbursement under this Section shall be subordinate in
right of payment to the prior payment in full of the Obligations. The provisions
of this Section shall, to the extent expressly inconsistent with any provision
in any Loan Document, supersede such inconsistent provision.
 

Amended and Restated Revolving Credit Agreement

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SECTION 9.23. Agency of Company for Each Other Borrower. Each of the other
Borrowers irrevocably appoints the Company as its agent for all purposes
relevant to this Agreement, including the giving and receipt of notices and
execution and delivery of all documents, instruments, and certificates
contemplated herein (including, without limitation, execution and delivery to
the Agents of Borrowing Base Certificates, Borrowing Requests and Interest
Election Requests) and all modifications hereto. Any acknowledgment, consent,
direction, certification, or other action which might otherwise be valid or
effective only if given or taken by all or any of the Borrowers or acting
singly, shall be valid and effective if given or taken only by the Company,
whether or not any of the other Borrowers joins therein, and the Agents and the
Lenders shall have no duty or obligation to make further inquiry with respect to
the authority of the Company under this Section 9.23, provided that nothing in
this Section 9.23 shall limit the effectiveness of, or the right of the Agents
and the Lenders to rely upon, any notice (including without limitation a
Borrowing Request or an Interest Election Request), document, instrument,
certificate, acknowledgment, consent, direction, certification, or other action
delivered by any Borrower pursuant to this Agreement.
 
SECTION 9.24. Additional Borrowers. Addition of any Person as a Borrower under
this Agreement is subject to approval of the Administrative Agent and the
Required Lenders, and may be conditioned upon such requirements as they may
determine in their discretion, including, without limitation, (a) the furnishing
of such financial and other information as the Administrative Agent or any such
Lender may request; (b) approval by all appropriate approval authorities of the
Administrative Agent and each such Lender; (c) execution and delivery by the
Borrowers, such person, the Administrative Agent, and the Required Lenders of
such agreements and other documentation (including, without limitation, an
amendment to this Agreement or any other Loan Document), and the furnishing by
such person or any of the Borrowers of such certificates, opinions, and other
documentation, as the Administrative Agent and any such Lender may request.
Neither the Administrative Agent nor any Lender shall have any obligation to
approve any such person for addition as a Borrower under this Agreement.
 
SECTION 9.25. Express Waivers By Borrowers In Respect of Cross Guaranties and
Cross Collateralization. Each Borrower agrees as follows:
 
(a) Each Borrower hereby waives: (i) notice of acceptance of this Agreement;
(ii) notice of the making of any Revolving Loans, the issuance of any Letter of
Credit or any other financial accommodations made or extended under the Loan
Documents or the creation or existence of any Obligations; (iii) notice of the
amount of the Obligations, subject, however, to such Borrower’s right to make
inquiry of the Administrative Agent to ascertain the amount of the Obligations
at any reasonable time; (iv) notice of any adverse change in the financial
condition of any other Borrower or of any other fact that might increase such
Borrower’s risk with respect to such other Borrower under the Loan Documents;
(v) notice of presentment for payment, demand, protest, and notice thereof as to
any promissory notes or other instruments among the Loan Documents; and (vii)
all other notices (except if such notice is specifically required to be given to
such Borrower hereunder or under any of the other Loan Documents to which such
Borrower is a party) and demands to which such Borrower might otherwise be
entitled;
 

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(b) Each Borrower hereby waives the right by statute or otherwise to require an
Agent or any Lender to institute suit against any other Borrower or to exhaust
any rights and remedies which an Agent or any Lender has or may have against any
other Borrower. Each Borrower further waives any defense arising by reason of
any disability or other defense of any other Borrower (other than the defense
that the Obligations shall have been fully and finally performed and paid) or by
reason of the cessation from any cause whatsoever of the liability of any such
Borrower in respect thereof.
 
(c) Each Borrower hereby waives and agrees not to assert against an Agent, any
Lender, or any Issuing Bank: (i) any defense (legal or equitable), set-off,
counterclaim, or claim which such Borrower may now or at any time hereafter have
against any other Borrower or any other party liable under the Loan Documents;
(ii) any defense, set-off, counterclaim, or claim of any kind or nature
available to any other Borrower against an Agent, any Lender, or any Issuing
Bank, arising directly or indirectly from the present or future lack of
perfection, sufficiency, validity, or enforceability of the Obligations or any
security therefor; (iii) any right or defense arising by reason of any claim or
defense based upon an election of remedies by an Agent, any Lender, or any
Issuing Bank under any applicable law; (iv) the benefit of any statute of
limitations affecting any other Borrower’s liability hereunder;
 
(d) Each Borrower consents and agrees that, without notice to or by such
Borrower and without affecting or impairing the obligations of such Borrower
hereunder, the Agents may (subject to any requirement for consent of any of the
Lenders to the extent required by this Agreement), by action or inaction: (i)
compromise, settle, extend the duration or the time for the payment of, or
discharge the performance of, or may refuse to or otherwise not enforce the Loan
Documents; (ii) release all or any one or more parties to any one or more of the
Loan Documents or grant other indulgences to any other Borrower in respect
thereof; (iii) amend or modify in any manner and at any time (or from time to
time) any of the Loan Documents; or (iv) release or substitute any Person liable
for payment of the Obligations, or enforce, exchange, release, or waive any
security for the Obligations or any Guaranty of the Obligations;
 
(e) Each Borrower represents and warrants to the Agents and the Lenders that
such Borrower is currently informed of the financial condition of all other
Borrowers and all other circumstances which a diligent inquiry would reveal and
which bear upon the risk of nonpayment of the Obligations. Each Borrower further
represents and warrants that such Borrower has read and understands the terms
and conditions of the Loan Documents. Each Borrower agrees that neither the
Agents, any Lender, nor any Issuing Bank has any responsibility to inform any
Borrower of the financial condition of any other Borrower or of any other
circumstances which bear upon the risk of nonpayment or nonperformance of the
Obligations.
 
SECTION 9.26. Intercreditor Agreements and Collateral Agreement. Each Lender
hereunder (a) consents to the priority and/or subordination of Liens provided
for in the Intercreditor Agreement, (b) consents to the priority and/or
subordination of Liens provided for in the Senior Lender Intercreditor
Agreement, (c) agrees that it will be bound by and will take no actions contrary
to the provisions of the Intercreditor Agreement or the Senior Lender
 

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Intercreditor Agreement, (c) authorizes and instructs the Collateral Agent to
enter into the Intercreditor Agreement as First Lien Intercreditor Agent and on
behalf of such Lender, (d) authorizes and instructs the Administrative Agent and
the Collateral Agent to enter into the Senior Lender Intercreditor Agreement as
Revolving Facility Administrative Agent and Collateral Agent, respectively, and
on behalf of such Lender, and (e) consents to the amendment of the First Lien
Guarantee and Collateral Agreement under (and as defined in) the Existing Credit
Agreement, in the form of the Collateral Agreement referred to herein. The
foregoing provisions are intended as an inducement to the Lenders to extend
credit and such Lenders are intended third party beneficiaries of such
provisions and the provisions of the Intercreditor Agreement and the Senior
Lender Intercreditor Agreement.
 

 
[Signature Pages Follow]
 

 

W/1118098v12
 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
written above.
 
 
COVALENCE SPECIALTY MATERIALS CORP.
 
By: 
 
 
Name:
 
 
Title:
 
 

 

 
 
[Signature Page to the Amended and Restated Revolving Credit Agreement]

 

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BERRY PLASTICS GROUP, INC.
 
By: 
 
 
Name:
 
 
Title:
 

[Signature Page to the Amended and Restated Revolving Credit Agreement]

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COVALENCE SPECIALTY ADHESIVES LLC
 
 
By: COVALENCE SPECIALTY MATERIALS CORP.,
 
 
its sole member and manager
 
 
By:_________________________________
 
 
Name:
 
 
Title:
 
 

 
 

 
 

 
 
COVALENCE SPECIALTY COATINGS LLC
 
 
By: COVALENCE SPECIALTY MATERIALS CORP.,
 
 
its sole member and manager
 
 
By:_________________________________
 
 
Name:
 
 
Title:
 

 
 
[Signature Page to the Amended and Restated Revolving Credit Agreement]

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BERRY PLASTICS HOLDING CORPORATION
BERRY PLASTICS CORPORATION
AEROCON, INC.
BERRY IOWA CORPORATION
BERRY PLASTICS DESIGN CORPORATION
BERRY PLASTICS TECHNICAL SERVICES, INC.
BERRY STERLING CORPORATION
CARDINAL PACKAGING, INC.
CPI HOLDING CORPORATION
KNIGHT PLASTICS, INC.
PACKERWARE CORPORATION
PESCOR, INC.
POLY-SEAL CORPORATION
VENTURE PACKAGING, INC.
VENTURE PACKAGING MIDWEST, INC.
BERRY PLASTICS ACQUISITION CORPORATION III
BERRY PLASTICS ACQUISITION CORPORATION V
BERRY PLASTICS ACQUISITION CORPORATION VII
BERRY PLASTICS ACQUISITION CORPORATION VIII
BERRY PLASTICS ACQUISITION CORPORATION IX
BERRY PLASTICS ACQUISITION CORPORATION X
BERRY PLASTICS ACQUISITION CORPORATION XI
BERRY PLASTICS ACQUISITION CORPORATION XII
BERRY PLASTICS ACQUISITION CORPORATION XIII
KERR GROUP, INC.
SAFFRON ACQUISITION CORP.
SUN COAST INDUSTRIES, INC.
 
By: 
 
 
Name:
 
 
Title:
 
LANDIS PLASTICS, INC.

 
By: 
 
 
Name:
 
 
Title:
 

[Signature Page to the Amended and Restated Revolving Credit Agreement]

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BERRY PLASTICS ACQUISITION CORPORATION XV, LLC

By:  Berry Plastics Corporation,
its sole member
 
By:________________________________
Name:
Title:

SETCO, LLC

By:  Kerr Group, Inc.,
its sole member

By:________________________________
Name:
Title:

TUBED PRODUCTS, LLC

By:  Kerr Group, Inc.,
its sole member

By:________________________________
Name:
Title:

 
 
[Signature Page to the Amended and Restated Revolving Credit Agreement]

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BANK OF AMERICA, N.A., 
as Administrative Agent and as Collateral Agent and as a Lender
 
By: 
 
 
Name:
 
 
Title: