Exhibit 10.1

EXECUTION VERSION

 

 

 

SHORT TERM FACILITY AGREEMENT

dated as of

October 20, 2014

among

LENNOX INTERNATIONAL INC.,

as the Borrower,

The Lenders Party Hereto

 

LOGO [g807340ex99_1logo.jpg]

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

as Administrative Agent,

 

 

 

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Table of Contents

 

          Page  

ARTICLE I. Definitions

     1   

Section 1.01

   Defined Terms      1   

Section 1.02

   Classification of Loans and Borrowings      18   

Section 1.03

   Terms Generally      18   

Section 1.04

   Accounting Terms; GAAP      19   

ARTICLE II. The Loan

     19   

Section 2.01

   Term Loan      19   

Section 2.02

   Loans and Borrowings      19   

Section 2.03

   Funding of Borrowings      21   

Section 2.04

   Interest Elections      21   

Section 2.05

   Amortization and Maturity of Term Loan      23   

Section 2.06

   Repayment of Loans; Evidence of Debt      23   

Section 2.07

   Prepayment of Loans      23   

Section 2.08

   Fees      24   

Section 2.09

   Interest      24   

Section 2.10

   Alternate Rate of Interest      25   

Section 2.11

   Increased Costs      26   

Section 2.12

   Break Funding Payments      27   

Section 2.13

   Taxes      27   

Section 2.14

   Payments Generally; Pro Rata Treatment; Sharing of Set-Offs; Proceeds of
Guaranty Agreement      31   

Section 2.15

   Mitigation Obligations; Replacement of Lenders      33   

Section 2.16

   Defaulting Lenders      34   

ARTICLE III. Representations and Warranties

     34   

Section 3.01

   Organization; Powers      34   

Section 3.02

   Authorization; Enforceability      34   

Section 3.03

   Governmental Approvals; No Conflicts      34   

Section 3.04

   Financial Condition; No Material Adverse Change      35   

Section 3.05

   Properties      35   

Section 3.06

   Litigation and Environmental Matters      35   

Section 3.07

   Compliance with Laws and Agreements      36   

Section 3.08

   Investment Company Status      36   

Section 3.09

   Taxes      36   

Section 3.10

   ERISA      36   

Section 3.11

   Disclosure      37   

Section 3.12

   Material Subsidiaries      37   

Section 3.13

   Insurance      37   

Section 3.14

   Labor Matters      37   

Section 3.15

   Solvency      38   

Section 3.16

   Margin Securities      38   

Section 3.17

   Anti-Corruption Laws and Sanctions      38   

ARTICLE IV. Conditions

     39   

Section 4.01

   Conditions of Credit Extension      39   

Section 4.02

   Conditions of Funding Term Loan      40   

 

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Table of Contents (continued)

 

          Page  

ARTICLE V. Affirmative Covenants

     41   

Section 5.01

   Financial Statements and Other Information      41   

Section 5.02

   Notices of Material Events      42   

Section 5.03

   Existence; Conduct of Business      42   

Section 5.04

   Payment of Obligations      43   

Section 5.05

   Maintenance of Properties      43   

Section 5.06

   Insurance      43   

Section 5.07

   Guarantee and Secure Loans Equally      43   

Section 5.08

   Books and Records; Inspection and Audit Rights      44   

Section 5.09

   Compliance with Laws      44   

Section 5.10

   Use of Proceeds      44   

Section 5.11

   New Material Subsidiaries      44   

Section 5.12

   Further Assurances      45   

Section 5.13

   Post-Closing Covenant      45   

ARTICLE VI. Negative Covenants

     45   

Section 6.01

   Indebtedness; Certain Equity Securities      45   

Section 6.02

   Liens      46   

Section 6.03

   Fundamental Changes      48   

Section 6.04

   Investments, Loans, Advances and Acquisitions      48   

Section 6.05

   Asset Sales      50   

Section 6.06

   Sale and Leaseback Transactions      51   

Section 6.07

   Swap Agreements      51   

Section 6.08

   Restricted Payments      51   

Section 6.09

   Transactions with Affiliates      51   

Section 6.10

   Restrictive Agreements      52   

Section 6.11

   Amendment of Material Documents      53   

Section 6.12

   Change in Fiscal Year      53   

ARTICLE VII. Financial Covenants

     53   

Section 7.01

   Leverage Ratio      53   

Section 7.02

   Interest Coverage Ratio      53   

ARTICLE VIII. Events of Default

     54   

Section 8.01

   Events of Default; Remedies      54   

Section 8.02

   Performance by the Administrative Agent      56   

Section 8.03

   Limitation on Separate Suit      56   

ARTICLE IX. The Administrative Agent

     56   

Section 9.01

   Appointment      56   

Section 9.02

   Rights as a Lender      57   

Section 9.03

   Limitation of Duties and Immunities      57   

Section 9.04

   Reliance on Third Parties      57   

Section 9.05

   Sub-Agents      58   

Section 9.06

   Successor Agent      58   

Section 9.07

   Independent Credit Decisions      58   

Section 9.08

   Authorized Release of Subsidiary Guarantor      58   

Section 9.09

   Lender Affiliates Rights      59   

 

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Table of Contents (continued)

 

          Page  

ARTICLE X. Miscellaneous

     59   

Section 10.01

   Notices      59   

Section 10.02

   Waivers; Amendments      61   

Section 10.03

   Expenses; Indemnity; Damage Waiver      62   

Section 10.04

   Successors and Assigns      64   

Section 10.05

   Survival      67   

Section 10.06

   Counterparts; Integration; Effectiveness; Amendment and Restatement;
Electronic Execution      67   

Section 10.07

   Severability      68   

Section 10.08

   Right of Setoff      68   

Section 10.09

   Governing Law; Jurisdiction; Consent to Service of Process      68   

Section 10.10

   WAIVER OF JURY TRIAL      69   

Section 10.11

   Headings      69   

Section 10.12

   Confidentiality      69   

Section 10.13

   Maximum Interest Rate      70   

Section 10.14

   No Duty      71   

Section 10.15

   No Fiduciary Relationship      71   

Section 10.16

   Equitable Relief      71   

Section 10.17

   Construction      72   

Section 10.18

   Independence of Covenants      72   

Section 10.19

   USA PATRIOT Act      72   

 

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LIST OF SCHEDULES AND EXHIBITS

 

SCHEDULES: Schedule 2.01    –    Lender’s Term Loan Commitments on the Effective
Date Schedule 3.12    –    Material Subsidiaries Schedule 6.01    –    Existing
Indebtedness Schedule 6.02    –    Existing Liens Schedule 6.04    –    Existing
Investments Schedule 6.10    –    Existing Restrictions EXHIBITS:       Exhibit
A    –    Form of Assignment and Assumption Exhibit B    –    Form of Compliance
Certificate Exhibit C    –    Form of Subsidiary Guaranty Agreement (Material
Subsidiaries) Exhibit D    –    Form of Interest Election Request Exhibit E-1   
–    Form of U.S. Tax Certificate (For Non-U.S. Lenders that are not
Partnerships for U.S. Federal Income Tax Purposes) Exhibit E-2    –    Form of
U.S. Tax Certificate (For Non-U.S. Participants that are not Partnerships for
U.S. Federal Income Tax Purposes) Exhibit E-3    –    Form of U.S. Tax
Certificate (For Non-U.S. Participants that are Partnerships for U.S. Federal
Income Tax Purposes) Exhibit E-4       Form of U.S. Tax Certificate (For
Non-U.S. Lenders that are Partnerships for U.S. Federal Income Tax Purposes)

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SHORT TERM FACILITY AGREEMENT (this “Agreement”) dated as of October 20, 2014,
among LENNOX INTERNATIONAL INC., a Delaware corporation, the LENDERS party
hereto, and JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, as Administrative Agent.

RECITALS

The Borrower has requested the Lenders party hereto make available a six-month
term loan facility to the Borrower. The Lenders are willing to make such
facility available to the Borrower subject to, and in accordance with, the terms
and conditions set forth in this Agreement.

The parties hereto agree as follows:

ARTICLE I.

Definitions

Section 1.01 Defined Terms. As used in this Agreement, the following terms have
the meanings specified below:

“ABR”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, bear interest at a rate determined
by reference to the Alternate Base Rate.

“Adjusted EBITDA” means, for any period (the “Subject Period”), the total of the
following calculated without duplication for such period: (a) Borrower’s EBITDA;
plus (b), on a pro forma basis, the pro forma EBITDA of each Prior Target or, as
applicable, the EBITDA of a Prior Target attributable to the assets acquired
from such Prior Target, for any portion of such Subject Period occurring prior
to the date of the acquisition of such Prior Target or the related assets but
only to the extent such EBITDA for such Prior Target can be established in a
manner reasonably satisfactory to the Administrative Agent based on financial
statements of the Prior Target prepared in accordance with GAAP; minus (c) the
EBITDA of each Prior Company and, as applicable but without duplication, the
EBITDA of Borrower and each Subsidiary attributable to all Prior Assets, in each
case for any portion of such Subject Period occurring prior to the date of the
disposal of such Prior Companies or Prior Assets.

“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any
Interest Period or with respect to the determination of the Alternate Base Rate
and the Eurodollar Daily Floating Rate, an interest rate per annum equal to
(a) the LIBO Rate for such Interest Period or, with respect to the determination
of the Alternate Base Rate and the Eurodollar Daily Floating Rate, for a one
month interest period multiplied by (b) the Statutory Reserve Rate.

“Administrative Agent” means JPMorgan Chase Bank, National Association (and its
subsidiaries and Affiliates), in its capacity as administrative agent for the
Lenders hereunder.

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

“Advance Date” has the meaning assigned to such term in Section 2.01.

 

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

“Agent Party” has the meaning assigned to such term in Section 10.01(d).

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus 0.5% and (c) the Adjusted LIBO Rate for a one
month interest period on such day (or if such day is not a Business Day, the
immediately preceding Business Day) plus 1%, provided that the Adjusted LIBO
Rate for any day shall be based on the LIBO Rate at approximately 11:00 a.m.
London time on such day, subject to the interest rate floors set forth therein.
Any change in the Alternate Base Rate due to a change in the Prime Rate, the
Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective from
and including the effective date of such change in the Prime Rate, the Federal
Funds Effective Rate or the Adjusted LIBO Rate, respectively.

“Anti-Corruption Laws” means all laws, rules, and regulations of any
jurisdiction applicable to the Borrower or any of its Affiliates from time to
time concerning or relating to bribery or corruption.

“Applicable Rate” means, for any day, with respect to any ABR Loan or any
Eurodollar Loan, as the case may be, the applicable rate per annum set forth
below under the caption “ABR Spread” or “Eurodollar Spread”, as the case may be,
subject to the provision below, based upon the Leverage Ratio as of the most
recent determination date:

 

Leverage Ratio

   ABR Spread     Eurodollar
Spread  

Category 1

> 3.00 to 1.0

     1.00 %      2.00 % 

Category 2

£ 3.00 to 1.0 but > 2.50 to 1.0

     0.75 %      1.75 % 

Category 3

£ 2.50 to 1.0 but > 2.00 to 1.0

     0.50 %      1.50 % 

Category 4

£ 2.00 to 1.0 but > 1.50 to 1.0

     0.25 %      1.25 % 

Category 5

£ 1.50 to 1.0

     0.00 %      1.00 % 

For purposes of the foregoing, (i) the Leverage Ratio shall be determined as of
the end of each fiscal quarter of the Borrower’s fiscal year based upon the
Borrower’s consolidated financial statements delivered pursuant to
Section 5.01(a) or (b); provided that, notwithstanding the foregoing, until the
delivery to the Administrative Agent of the Borrower’s consolidated financial
statements for the fiscal year ending December 31, 2014 pursuant to
Section 5.01(a) and the corresponding compliance certificate delivered pursuant
to Section 5.01(c), the “Applicable Rate” shall be determined based on the
Leverage Ratio set forth in the pro forma compliance certificate delivered by
the Borrower required by Section 4.01(f) and (ii) each change in the Applicable
Rate resulting from a change in the Leverage Ratio shall be effective during the
period commencing on and including the date of delivery to the Administrative
Agent of such consolidated financial

 

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statements indicating such change and ending on the date immediately preceding
the effective date of the next such change; provided further that the Leverage
Ratio shall be deemed to be in Category 1 (A) at any time that an Event of
Default has occurred and is continuing or (B) at the option of the
Administrative Agent or at the request of the Required Lenders if the Borrower
fails to deliver the consolidated financial statements required to be delivered
by it pursuant to Section 5.01(a) or (b), during the period from the expiration
of the time for delivery thereof until such consolidated financial statements
are delivered. If it is ever subsequently determined that such financial
statements did not accurately report as of the date of such financial statements
the information necessary to determine the Leverage Ratio and as a result
thereof the Leverage Ratio utilized to determine the Applicable Rate was not
correct and resulted in (i) the Applicable Rate being otherwise lower than it
should have been if the Leverage Ratio was accurately determined, then the
Borrower shall pay to the Administrative Agent the amount that would have been
due under the terms hereof if the Leverage Ratio was calculated correctly or
(ii) the Applicable Rate being otherwise higher than it should have been if the
Leverage Ratio was accurately determined, then the Borrower shall receive a
credit equal to the amount of the overpayment to be applied to future
Obligations. A certificate of the Administrative Agent setting forth the amount
or amounts (including a reasonably detailed calculation thereof) of any such
difference shall be delivered to the Borrower and the Borrower shall pay the
Administrative Agent the amount shown as due on any such certificate within 30
days after receipt thereof.

“Approved Fund” has the meaning assigned to such term in Section 10.04.

“Assignment and Assumption” means an Assignment and Assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required
by Section 10.04), and accepted by the Administrative Agent, in the form of
Exhibit A or any other form approved by the Administrative Agent.

“Bank Facility” means that certain Fourth Amended and Restated Revolving Credit
Facility Agreement, dated as of October 21, 2011, among the Borrower, the
lenders party thereto and JPMorgan as Administrative Agent.

“Bankruptcy Event” means, with respect to any Person, such Person becomes the
subject of a bankruptcy or insolvency proceeding, or has had a receiver,
conservator, trustee, administrator, custodian, assignee for the benefit of
creditors or similar Person charged with the reorganization or liquidation of
its business appointed for it, or, in the good faith determination of the
Administrative Agent, has taken any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any such proceeding or appointment,
provided that a Bankruptcy Event shall not result solely by virtue of any
ownership interest, or the acquisition of any ownership interest, in such Person
by a Governmental Authority or instrumentality thereof, unless such ownership
interest results in or provides such Person with immunity from the jurisdiction
of courts within the United States or from the enforcement of judgments or writs
of attachment on its assets or permit such Person (or such Governmental
Authority or instrumentality), to reject, repudiate, disavow or disaffirm any
contracts or agreements made by such Person.

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

“Borrower” means Lennox International Inc., a Delaware corporation.

“Borrowing” means Loans of the same Type, made, converted or continued on the
same date and, in the case of Eurodollar Loans, as to which a single Interest
Period is in effect.

 

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“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City and Dallas, Texas are authorized or
required by law to remain closed; provided that, when used in connection with a
Eurodollar Loan, the term “Business Day” shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.

“Capital Expenditures” means, for any period and a Person, the additions to
property, plant and equipment and other capital expenditures of such Person and
its consolidated subsidiaries that are (or would be) set forth in a consolidated
statement of cash flows of such Person for such period prepared in accordance
with GAAP.

“Capital Lease Obligations” of any Person means the obligations of such Person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP, and the amount of such obligations
shall be the capitalized amount thereof determined in accordance with GAAP.

“Change in Control” means the acquisition by any New Owner of beneficial
ownership of 40% or more of the outstanding shares of common stock of the
Borrower entitled to vote for members of the board of directors of the Borrower.
As used in this definition,

“Norris Family” means all Persons who are lineal descendants of D.W. Norris (by
birth or adoption), all spouses of such descendants, all estates of such
descendants or spouses which are in the course of administration, all trusts for
the benefit of such descendants or spouses, and all corporations or other
entities in which, directly or indirectly, such descendants or spouses (either
alone or in conjunction with other such descendants or spouses) have the right,
whether by ownership of stock or other Equity Interests or otherwise, to direct
the management and policies of such corporations or other entities (each such
person, spouse, estate, trust, corporation or entity being referred to herein as
a “member” of the Norris Family).

“New Owner” means any Person (other than a member of the Norris Family), or any
syndicate or group of Persons (exclusive of all members of the Norris Family)
which would be deemed a Person or group (within the meaning of the Securities
Exchange Act of 1934 and the rules of the SEC thereunder as in effect on the
date hereof), who directly or indirectly acquires shares in the Borrower.

“Change in Law” means the occurrence after the date of this Agreement or, with
respect to any Lender, such later date on which such Lender becomes a party to
this Agreement of (a) the adoption of or taking effect of any law, rule,
regulation or treaty (including any rules or regulations issued under or
implementing any existing law), (b) any change in any law, rule, regulation or
treaty or in the interpretation or application thereof by any Governmental
Authority or (c) compliance by any Lender (or, for purposes of Section 2.11(b),
by any lending office of such Lender or by such Lender’s holding company, if
any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the date of this
Agreement; provided that notwithstanding anything herein to the contrary,
(i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all
requests, rules, guidelines or directives thereunder, issued in connection
therewith or in implementation thereof, and (ii) all requests, rules, guidelines
and directives promulgated by the Bank for International Settlements, the Basel
Committee on Banking Supervision (or any successor or similar authority) or the
United States or foreign regulatory authorities, in each case pursuant to
Basel III, shall in each case be deemed to be a “Change in Law”, regardless of
the date enacted, adopted, issued or implemented.

 

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

“Communications” has the meaning assigned to such term in Section 10.01(d).

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

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

“Consolidated Net Income” means, for any period, the net income (or net loss) of
the Borrower and its Subsidiaries for such period, determined in accordance with
GAAP.

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

“Default” means any event or condition which constitutes an Event of Default or
which upon notice, lapse of time or both would, unless cured or waived, become
an Event of Default.

“Defaulting Lender” means any Lender that (a) has failed, within two Business
Days of the date required to be funded or paid, to (i) fund any portion of its
Loans, (ii) pay over to any Secured Party any other amount required to be paid
by it hereunder, unless, in the case of clause (i) above, such Lender notifies
the Administrative Agent in writing that such failure is the result of such
Lender’s good faith determination that a condition precedent to funding
(specifically identified and including the particular Default, if any) has not
been satisfied; (b) has notified the Borrower or any Secured Party in writing,
or has made a public statement, to the effect that it does not intend or expect
to comply with any of its funding obligations under this Agreement or generally
under other agreements in which it commits to extend credit, (c) has failed,
within three Business Days after request by a Secured Party, acting in good
faith, to provide a certification in writing from an authorized officer of such
Lender that it will comply with its obligations (and is financially able to meet
such obligations), provided that such Lender shall cease to be a Defaulting
Lender pursuant to this clause (c) upon such Secured Party’s receipt of such
certification in form and substance satisfactory to it and the Administrative
Agent, or (d) has become the subject of a Bankruptcy Event.

“Disclosed Matters” means all the matters disclosed in (a) the Borrower’s draft
report to the SEC on Form 10–Q for the quarterly period ended September 30,
2014, provided to the Administrative Agent on the date hereof and (b) the
Borrower’s reports to the SEC on any Form 8-K filed on or after the Form 10-Q
for the quarterly period ended September 30, 2014, but before the Effective
Date, and on Form 10–K for the fiscal year ended December 31, 2013.

“Dollars”, “dollars” or “$” refers to lawful money of the United States of
America.

“Duration Fees” has the meaning assigned to such term in Section 2.08(a).

 

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“EBITDA” means, for any period, the total of the following calculated for
Borrower and its Subsidiaries without duplication on a consolidated basis in
accordance with GAAP consistently applied for such period: (a) Consolidated Net
Income; plus (b) without duplication and to the extent deducted in determining
Consolidated Net Income for such period, the sum of: (i) income and franchise
taxes, (ii) Interest Expense, (iii) amortization and depreciation expense,
(iv) non-cash charges resulting from the application of GAAP that requires a
charge against earnings for the impairment of assets (including goodwill),
(v) any non-cash expenses that arose in connection with the grant of stock
options or other equity based awards to officers, directors, consultants, and
employees of the Borrower and its Subsidiaries, (vi) any non-recurring charges
which relate to the discontinuance of Subsidiary operations, (vii) any
non-recurring charges which relate to restructuring and severance activities;
provided, that the total cash amount of such charges shall not exceed
$15,000,000 during any four fiscal quarter period (not taking into account any
cash charges under (viii) below), (viii) any non-recurring charges which relate
to the refinance of the lease of the Borrower’s headquarters building located at
2140 Lake Park Blvd., Richardson, Texas (the “Synthetic Lease”); provided, that
the total cash amount of such charges shall not exceed $15,000,000 during the
term of this Agreement, (ix) any non-cash loss (or minus any gain) associated
with the sale of assets not in the ordinary course of business,
(x) extraordinary loss or other items (or minus any extraordinary gain or
income), (xi) any non-cash loss (or minus any non-cash gain) related to
financial instrument hedges (other than foreign currency hedges), and (xii) the
cumulative non-cash effects of changes in accounting policies; minus (c) cash
payments made in such period related to a non-cash expense (other than with
respect to restructuring activities) added to Consolidated Net Income in a
previous period.

“Effective Date” means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 10.02).

“Electronic Signature” means an electronic sound, symbol, or process attached
to, or associated with, a contract or other record and adopted by a person with
the intent to sign, authenticate or accept such contract or record.

“Electronic System” means any electronic system, including e-mail, e-fax,
Intralinks®, ClearPar®, Debt Domain, Syndtrak and any other Internet or
extranet-based site, whether such electronic system is owned, operated or hosted
by the Administrative Agent and any of its respective Related Parties or any
other Person, providing for access to data protected by passcodes or other
security system.

“Environmental Laws” means all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of natural resources, the
management, release or threatened release of any Hazardous Material or to health
and safety matters.

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

 

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“Equity Interests” means shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person, and any warrants, options
or other rights entitling the holder thereof to purchase or acquire any such
equity interests.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
that, together with the Borrower, is treated as a single employer under
Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of
ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (other than an
event for which the 30-day notice period is waived); (b) the failure of any Plan
to satisfy the “minimum funding standards” in any respect (as described in
Sections 412 or 430 of the Code or Section 302 of ERISA), determined without
regard to whether any such contribution required under the Code or ERISA has or
has not been waived by the Internal Revenue Service; (c) the filing pursuant to
Section 412 of the Code or Section 303 of ERISA of an application for a waiver
of the minimum funding standard with respect to any Plan; (d) the incurrence by
the Borrower or any of its ERISA Affiliates of any liability under Title IV of
ERISA with respect to the termination of any Plan; (e) the receipt by the
Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any
notice relating to an intention to terminate any Plan or Plans or to appoint a
trustee to administer any Plan; (f) the incurrence by the Borrower or any of its
ERISA Affiliates of any liability with respect to the withdrawal or partial
withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the
Borrower or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.

“euro” or “Euro” means the single currency of the Participating Member States.

“Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Adjusted LIBO Rate but not including any
Loan or Borrowing bearing interest at a rate determined by reference to
(a) clause (c) of the definition of the term “Alternate Base Rate” or (b) the
term “Eurodollar Daily Floating Rate”.

“Eurodollar Daily Floating Rate” means, for any day, the daily fluctuating rate
per annum equal to the Adjusted LIBO Rate for a one month interest period. Any
change in the Eurodollar Daily Floating Rate due to a change in the LIBO Rate
shall be effective from and including the effective date of such change in the
LIBO Rate.

“Event of Default” has the meaning assigned to such term in Article VIII.

“Excluded Foreign Subsidiary” means any Foreign Subsidiary in respect of which
the guaranteeing of the Obligations would result in an adverse tax consequence
to the Borrower.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient or required to be withheld or deducted from a payment to a
Recipient, (a) Taxes

 

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imposed on or measured by net income (however denominated), franchise Taxes, and
branch profits Taxes, in each case, (i) imposed as a result of such Recipient
being organized under the laws of, or having its principal office or, in the
case of any Lender, its applicable lending office located in, the jurisdiction
imposing such Tax (or any political subdivision thereof) or (ii) that are Other
Connection Taxes, (b) in the case of a Lender, U.S. Federal withholding Taxes
imposed on amounts payable to or for the account of such Lender with respect to
an applicable interest in a Loan pursuant to a law in effect on the date on
which (i) such Lender acquires such interest in the Loan (other than pursuant to
an assignment request by the Borrower under Section 2.15(b)) or (ii) such Lender
changes its lending office, except in each case to the extent that, pursuant to
Section 2.13, amounts with respect to such Taxes were payable either to such
Lender’s assignor immediately before such Lender acquired the applicable
interest in a Loan or to such Lender immediately before it changed its lending
office, (c) Taxes attributable to such Recipient’s failure to comply with
Section 2.13(f) and (g), and (d) any U.S. Federal withholding Taxes imposed
under FATCA.

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

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published on the next succeeding Business Day by
the Federal Reserve Bank of New York, or, if such rate is not so published for
any day that is a Business Day, the average (rounded upwards, if necessary, to
the next 1/100 of 1%) of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it; provided, that if the Federal Funds
Effective Rate shall be less than zero, such rate shall be deemed to be zero for
purposes of this Agreement.

“Financial Officer” means the chief financial officer, principal accounting
officer, treasurer or controller of the Borrower.

“Foreign Lender” means any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.

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

“Fully Satisfied” or “Full Satisfaction” means, as of any date, that on or
before such date with respect to the Loan Obligations: (a) the principal of and
interest accrued to such date on the Loan Obligations shall have been paid in
full in cash and (b) all fees, expenses and other amounts then due and payable
which constitute Loan Obligations (other than contingent amounts not then
liquidated) shall have been paid in full in cash.

“GAAP” means generally accepted accounting principles in the United States of
America.

 

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“Governmental Authority” means the government of the United States of America,
any other nation or any political subdivision thereof, whether state or local,
and any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory
or administrative powers or functions of or pertaining to government (including
any supra-national bodies such as the European Union or the European Central
Bank) and any group or body charged with setting financial accounting or
regulatory capital rules or standards (including the Financial Accounting
Standards Board, the Bank for International Settlements or the Basel Committee
on Banking Supervision or any successor or similar authority to any of the
foregoing).

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation (including any
obligations under an operating lease) of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, and including any
obligation of the guarantor, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation or to purchase (or to advance or supply funds for the purchase
of) any security for the payment thereof, (b) to purchase or lease property,
securities or services for the purpose of assuring the owner of such
Indebtedness or other obligation (including any obligations under an operating
lease) of the payment thereof, (c) to maintain working capital, equity capital
or any other financial statement condition or liquidity of the primary obligor
so as to enable the primary obligor to pay such Indebtedness or other obligation
or (d) as an account party in respect of any letter of credit or letter of
guaranty issued to support such Indebtedness or obligation; provided, that the
term Guarantee shall not include endorsements for collection or deposit in the
ordinary course of business.

“Guaranty Agreement” means the Subsidiary Guaranty Agreement executed by the
Subsidiary Guarantors dated as of the date hereof, substantially in the form of
Exhibit C hereto.

“Hazardous Materials” means all explosive or radioactive substances or wastes
and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.

“Impacted Interest Period” has the meaning assigned to such term in the
definition of “LIBO Rate.”

“Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money or with respect to deposits or advances of any
kind (including the Receivable Securitization Outstandings); (b) all obligations
of such Person evidenced by bonds, debentures, notes or similar instruments;
(c) all obligations of such Person upon which interest charges are customarily
paid; (d) all obligations of such Person under conditional sale or other title
retention agreements relating to property acquired by such Person; (e) all
obligations of such Person in respect of the deferred purchase price of property
or services (excluding current accounts payable incurred in the ordinary course
of business); (f) all Indebtedness of others secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on property owned or acquired by such Person, whether or
not the Indebtedness secured thereby has been assumed; (g) all Guarantees by
such Person of Indebtedness of others; (h) all Capital Lease Obligations of such
Person; (i) all obligations, contingent or otherwise, of such Person as an
account party in respect of letters of credit and

 

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letters of guaranty (but excluding obligations in respect of (1) trade or
commercial letters of credit issued for the account of such Person in the
ordinary course of business and (2) stand-by letters of credit issued to support
obligations of such Person that are not of the type described in any of clauses
(a) through (h) and (j) through (l) of this definition); (j) all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances;
(k) all obligations of such Person under any Swap Agreement; and (l) all
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 lease is required or is permitted to be classified
and accounted for as an operating lease under GAAP but which is intended by the
parties thereto for tax, bankruptcy, regulatory, commercial law, real estate law
and all other purposes as a financing arrangement. The Indebtedness of any
Person shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general partner) to the extent such Person
is liable therefor as a result of such Person’s ownership interest in or other
relationship with such entity, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefor. The amount of the
obligations of the Borrower or any Subsidiary in respect of any Swap Agreement
shall, at any time of determination and for all purposes under this Agreement,
be the maximum aggregate amount (giving effect to any netting agreements) that
the Borrower or such Subsidiary would be required to pay if such Swap Agreement
were terminated at such time giving effect to current market conditions
notwithstanding any contrary treatment in accordance with GAAP.

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

“Interest Election Request” means a request by the Borrower to convert or
continue a Borrowing in accordance with Section 2.04.

“Interest Expense” means the sum of the following calculated on a consolidated
basis without duplication in accordance with GAAP: (a) total interest expense
(excluding interest expense derived from amortization of fees and including any
interest expense attributable to any Receivable Securitization Facility); plus
(b) that portion of amounts paid under synthetic lease obligations that is
representative of the interest expense that would have been paid if such
transaction were accounted for as a capital lease or otherwise as a financing.

“Interest Payment Date” means (a) with respect to any ABR Loan, the last day of
each March, June, September and December, and (b) with respect to any Eurodollar
Loan, the last day of the Interest Period applicable to the Borrowing of which
such Loan is a part and, in the case of a Eurodollar Borrowing with an Interest
Period of more than three months’ duration, each day prior to the last day of
such Interest Period that occurs at intervals of three months’ duration after
the first day of such Interest Period.

“Interest Period” means with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending seven days or one, two,
three or six months thereafter, in each case, as the Borrower may elect,
provided, that (y) if any Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless, such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day and (z) any Interest Period (other than a seven day
Interest Period) that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last

 

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Business Day of the last calendar month of such Interest Period. For purposes
hereof, the date of a Borrowing initially shall be the Advance Date and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.

“Interpolated Rate” means, at any time, for any Interest Period, the rate per
annum (rounded to the same number of decimal places as the LIBO Screen Rate)
determined by the Administrative Agent (which determination shall be conclusive
and binding absent manifest error) to be equal to the rate that results from
interpolating on a linear basis between: (a) the LIBO Screen Rate for the
longest period for which the LIBO Screen Rate is available that is shorter than
the Impacted Interest Period; and (b) the LIBO Screen Rate for the shortest
period (for which that LIBO Screen Rate is available) that exceeds the Impacted
Interest Period, in each case, at such time.

“IRS” means the United States Internal Revenue Service.

“Lenders” means for all purposes, the Persons listed on Schedule 2.01 and any
other Person that shall have become a party hereto pursuant to an Assignment and
Assumption, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Assumption or otherwise.

“Leverage Ratio” means the ratio of Total Indebtedness to Adjusted EBITDA, as
calculated in accordance with Section 7.01.

“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest
Period, the London interbank offered rate as administered by ICE Benchmark
Administration (or any other Person that takes over the administration of such
rate for U.S. Dollars) for a period equal in length to such Interest Period as
displayed on pages LIBOR01 or LIBOR02 of the Reuters screen that displays such
rate (or, in the event such rate does not appear on a Reuters page or screen, on
any successor or substitute page on such screen that displays such rate, or on
the appropriate page of such other information service that publishes such rate
from time to time as selected by the Administrative Agent in its reasonable
discretion; in each case the “LIBO Screen Rate”) at approximately 11:00 a.m.,
London time, two Business Days prior to the commencement of such Interest
Period; provided that if the LIBO Screen Rate shall be less than zero, such rate
shall be deemed to be zero for the purposes of this Agreement; provided further
that if the LIBO Screen Rate shall not be available at such time for such
Interest Period (an “Impacted Interest Period”) then the LIBO Rate shall be the
Interpolated Rate; provided that if any Interpolated Rate shall be less than
zero, such rate shall be deemed to be zero for purposes of this Agreement.

“LIBO Screen Rate” has the meaning assigned to such term in the definition of
“LIBO Rate.”

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement (or any financing lease
having substantially the same economic effect as any of the foregoing) relating
to such asset and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.

“Loan Documents” means this Agreement, the Guaranty Agreement, and all other
certificates, agreements and other documents or instruments now or hereafter
executed and/or delivered pursuant to or in connection with the foregoing.

 

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“Loan Obligations” means all obligations, indebtedness, and liabilities of the
Borrower or any Subsidiaries, or any one of them, to the Administrative Agent
and the Lenders arising pursuant to any of the Loan Documents, whether now
existing or hereafter arising, whether direct, indirect, related, unrelated,
fixed, contingent, liquidated, unliquidated, joint, several, or joint and
several, including the obligation of the Borrower or any Subsidiaries to repay
the Loans, interest on the Loans, and all fees, costs, and expenses (including
attorneys’ fees and expenses) provided for in the Loan Documents.

“Loan Parties” means the Borrower and the Subsidiary Guarantors.

“Loans” means the loans made by the Lenders to the Borrower pursuant to this
Agreement.

“Material Adverse Effect” means a material adverse effect on (a) the business,
operations, affairs, financial condition, assets or properties of the Borrower
and the Subsidiaries taken as a whole, (b) the ability of any Loan Party to
perform its obligations under the Loan Documents to which it is a party or
(c) the rights of or benefits available to the Administrative Agent or any
Lender.

“Material Indebtedness” means Indebtedness (other than the Loans but including
Receivable Securitization Outstandings and obligations in respect of one or more
Swap Agreements) of any one or more of the Borrower and its Subsidiaries in an
aggregate principal amount exceeding $75,000,000.

“Material Subsidiary” means any Subsidiary of the Borrower (except LPAC Corp.
and any Excluded Foreign Subsidiary), the book value (as determined in
accordance with GAAP) of whose total assets equals or exceeds ten percent
(10%) of the book value (determined in accordance with GAAP) of the consolidated
total assets of the Borrower and all of its Subsidiaries as determined as of the
last day of each fiscal quarter of the Borrower.

“Maturity Date” means March 31, 2015.

“Maximum Rate” has the meaning assigned to such term in Section 10.13(a).

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

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3)
of ERISA.

“Obligations” means all Loan Obligations.

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

“Other Taxes” means all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security

 

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interest under, or otherwise with respect to, any Loan Document, except any such
Taxes that are Other Connection Taxes imposed with respect to an assignment
(other than an assignment made pursuant to Section 2.15).

“Participant” has the meaning set forth in Section 10.04(c).

“Participant Register” has the meaning set forth in Section 10.04(c).

“Participating Member State” means any member state of the European Communities
that adopts or has adopted the euro as its lawful currency in accordance with
legislation of the European Community relating to Economic and Monetary Union.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA and any successor entity performing similar functions.

“Permitted Encumbrances” means:

(a) Liens imposed by law for Taxes that are not yet due or are being contested
in compliance with Section 5.04;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other
like Liens imposed by law, arising in the ordinary course of business and
securing obligations that are not overdue by more than 60 days or are being
contested in compliance with Section 5.04;

(c) pledges and deposits made in the ordinary course of business in compliance
with workers’ compensation and other casualty-related insurance programs,
unemployment insurance, employer’s health tax, other social security laws or
regulations, or retirement benefits (including, pledges or deposits or similar
Liens securing liabilities to insurance carriers under insurance or
self-insurance arrangements in the ordinary course);

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

(e) judgment liens in respect of judgments that do not constitute an Event of
Default under clause (k) of Section 8.01;

(f) easements, zoning restrictions, leases or subleases granted to others in the
ordinary course of business and covering only the assets so leased,
rights-of-way, restrictive covenants, and similar encumbrances on real property
imposed by law or arising in the ordinary course of business that do not secure
any monetary obligations and do not materially detract from the value of the
affected property or interfere with the ordinary conduct of business of the
Borrower or any Subsidiary;

(g) Liens arising from filing UCC financing statements regarding leases
permitted by this Agreement;

 

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(h) leases or subleases entered into by Borrower or a Subsidiary in good faith
with respect to its property not used in its business and which do not
materially interfere with the ordinary conduct of business of the Borrower or
any Subsidiary;

(i) statutory and common law landlords’ liens under leases to which Borrower or
one of the Subsidiaries is a party; and

(j) customary Liens (including the right of set-off) in favor of banking
institutions encumbering deposits held by such banking institutions incurred in
the ordinary course of business.

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

“Permitted Investments” means:

(a) direct obligations of, or obligations the principal of and interest on which
are unconditionally guaranteed by, the United States of America (or by any
agency thereof to the extent such obligations are backed by the full faith and
credit of the United States of America), in each case maturing within one year
from the date of acquisition thereof;

(b) investments in commercial paper maturing within 270 days from the date of
acquisition thereof and having, at such date of acquisition, one of the two
highest credit ratings obtainable from S&P or from Moody’s;

(c) investments in certificates of deposit, banker’s acceptances and time
deposits maturing within one year from the date of acquisition thereof issued or
guaranteed by or placed with, and money market deposit accounts issued or
offered by, any domestic office of any commercial bank organized under the laws
of the United States of America or any State thereof which has a combined
capital and surplus and undivided profits of not less than $500,000,000;

(d) fully collateralized repurchase agreements with a term of not more than 30
days for securities described in clause (a) above and entered into with a
financial institution satisfying the criteria described in clause (c) above;

(e) money market funds that (i) comply with the criteria set forth in SEC
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 $5,000,000,000;
and

(f) in the case of any Foreign Subsidiary, investments that are substantially
similar to those described above.

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

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA, and in respect of which the Borrower 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.

 

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“Platform” means Debt Domain, Intralinks, Syndtrak or a substantially similar
electronic transmission system.

“Prime Rate” means the rate of interest per annum publicly announced from time
to time by JPMorgan Chase Bank, National Association as its prime rate in effect
at its principal office in New York City; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.

“Prior Assets” means assets that have been disposed of by a division or branch
of Borrower or a Subsidiary in a transaction with an unaffiliated third party
approved in accordance with this Agreement which would not make the seller a
“Prior Company” but constitute all or substantially all of the assets of such
division or branch for which the total consideration to be paid exceeds
$25,000,000.

“Prior Company” means any Subsidiary whose capital stock or other equity
interests have been disposed of, or all or substantially all of whose assets
have been disposed of, in each case, in a transaction with an unaffiliated third
party approved in accordance with this Agreement for which the total
consideration to be paid exceeds $25,000,000.

“Prior Target” means all targets acquired or whose assets have been acquired in
an acquisition permitted by Section 6.04 for which the total consideration to be
paid exceeds $25,000,000.

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

“Receivable Securitization Facility” means, with respect to the Borrower or any
Subsidiary, a transaction or group of transactions typically referred to as a
securitization in which the Borrower or such Subsidiary sells its accounts
receivable in a transaction accounted for as a true sale to a special purpose
bankruptcy remote entity that obtains debt financing to finance the purchase
price.

“Receivable Securitization Outstandings” means the aggregate amount outstanding
(i.e., advanced as the purchase price and not repaid from collections) under all
Receivable Securitization Facilities of the Borrower and its Subsidiaries that
is representative of the principal amount that would be outstanding if such
Receivable Securitization Facilities were accounted for as financings.

“Register” has the meaning set forth in Section 10.04.

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

“Required Lenders” means, at any time, Lenders (other than Defaulting Lenders)
having more than 50.00% of the sum of the total outstanding Loans, or unused
Term Loan Commitments, as applicable, at such time; provided that for the
purpose of determining the Required Lenders needed for any waiver, amendment,
modification or consent, any Lender that is the Borrower, or any Affiliate of
the Borrower shall be disregarded.

 

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“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in the
Borrower or any Subsidiary, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any such Equity Interests in the Borrower or any Subsidiary or any option,
warrant or other right to acquire any such Equity Interests in the Borrower or
any Subsidiary (other than any compensation related options, warrants or other
rights granted to employees, officers or directors of the Borrower and its
Subsidiaries).

“S&P” means Standard & Poor’s Rating Services, a division of the McGraw Hill
Companies.

“Sanctioned Country” means, at any time, a country or territory which is itself
the subject or target of any Sanctions (at the time of this Agreement, Cuba,
Iran, North Korea, Sudan and Syria).

“Sanctioned Person” means, at any time, (a) any Person listed in any
Sanctions-related list of designated Persons maintained by the Office of Foreign
Assets Control of the U.S. Department of the Treasury, the U.S. Department of
State, (b) any Person operating, organized or resident in a Sanctioned Country
or (c) any Person owned or controlled by any such Person or Persons described in
the foregoing clauses (a) or (b).

“Sanctions” means economic or financial sanctions or trade embargoes imposed,
administered or enforced from time to time by the U.S. government, including
those administered by the Office of Foreign Assets Control of the U.S.
Department of the Treasury or the U.S. Department of State.

“SEC” means the Securities and Exchange Commission of the United State of
America.

“Secured Parties” means the Administrative Agent, the Lenders and each Affiliate
of a Lender who is owed any portion of the Obligations.

“Senior Unsecured Notes” means those 4.90% notes due 2017 issued pursuant to
that certain First Supplemental Indenture dated as of May 6, 2010 among the
Borrower, as issuer, certain of the Subsidiaries, as guarantors, and U.S. Bank
National Association, as trustee.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentage (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject with
respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred
to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve
percentage shall include those imposed pursuant to such Regulation D of the
Board. Eurodollar Loans shall be deemed to constitute eurocurrency funding and
to be subject to such reserve requirements without benefit of or credit for
proration, exemptions or offsets that may be available from time to time to any
Lender under such Regulation D of the Board or any comparable regulation. The
Statutory Reserve Rate shall be adjusted automatically on and as of the
effective date of any change in any reserve percentage.

“subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of

 

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which would be consolidated with those of the parent in the parent’s
consolidated financial statements if such financial statements were prepared in
accordance with GAAP as of such date, as well as any other corporation, limited
liability company, partnership, association or other 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, in the case of a partnership,
more than 50% of the general partnership interests are, as of such date, owned,
controlled or held, or (b) that is, as of such date, 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” means any subsidiary of the Borrower.

“Subsidiary Guarantor” means each Subsidiary of the Borrower (other than an
Excluded Foreign Subsidiary) that is party to the Guaranty Agreement.

“Swap Agreement” means any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement involving, or settled
by reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or measures
of economic, financial or pricing risk or value or any similar transaction or
any combination of these transactions; provided that no phantom stock or similar
plan providing for payments only on account of services provided by current or
former directors, officers, employees or consultants of the Borrower or the
Subsidiaries shall be a Swap Agreement. For the avoidance of doubt, agreements
relating to accelerated share repurchase programs, and similar programs or
arrangements, shall not be considered Swap Agreements.

“Synthetic Lease” has the meaning ascribed to such term in the definition of
“EBITDA” hereunder.

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

“Term Loan” means the term loan made by the Lenders hereunder on the Advance
Date pursuant to Section 2.01.

“Term Loan Availability Period” means the period from and including the
Effective Date through and including October 24, 2014.

“Term Loan Commitment” means, with respect to each Lender, the commitment of
such Lender to make its portion of the Term Loan available to the Borrower
during the Term Loan Availability Period in the amount as set forth on
Schedule 2.01 hereto, as such commitment may be reduced or increased from time
to time pursuant to assignments by or to such Lender pursuant to Section 10.04.
As of the Effective Date, the aggregate amount of the Lenders’ Term Loan
Commitments is $250,000,000. The aggregate amount of the Lenders’ Term Loan
Commitments will reduce to $0 and terminate immediately and automatically upon
the earlier of (a) the funding of the Term Loan and (b) the expiration of the
Term Loan Availability Period.

“Total Indebtedness” means, at the time of determination, the sum of the
following determined for Borrower and the Subsidiaries on a consolidated basis
(without duplication): (a) the outstanding principal amount of all obligations
for borrowed money (including the Loan Obligations and the Receivable
Securitization Outstandings) including all such obligations

 

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evidenced by bonds, notes, debentures, or other similar instruments; plus
(b) all obligations of such Person under conditional sale or other title
retention agreements relating to property acquired by such Person; plus (c) all
obligations of such Person in respect of the deferred purchase price of property
or services (excluding accounts payable incurred in the ordinary course of
business); plus (d) all obligations of others secured by (or for which the
holder of such obligations has an existing right, contingent or otherwise, to be
secured by) any Lien on property owned or acquired by such Person, whether or
not the obligations secured thereby have been assumed (provided that for
purposes of this clause (d) the amount of any such Indebtedness shall be deemed
not to exceed the higher of the market value or the book value of such assets),
plus (e) all Capital Lease Obligations; plus (f) all obligations, contingent or
otherwise, of such Person as an account party in respect of letters of credit
and letters of guaranty (but excluding obligations in respect of (1) trade or
commercial letters of credit issued for the account of such Person in the
ordinary course of business and (2) stand-by letters of credit issued to support
obligations of such Person that are not of the type described in any of
clauses (a) through (c) and (e) of this definition); plus (g) all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances.

“Transactions” means the execution, delivery and performance by each Loan Party
of the Loan Documents to which it is to be a party, the borrowing of Loans and
the use of the proceeds thereof.

“Type”, when used in reference to any Loan or Borrowing, refers to whether the
rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBO Rate, the Alternate Base Rate, or
the Eurodollar Daily Floating Rate.

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

Section 1.02 Classification of Loans and Borrowings. For purposes of this
Agreement, Loans may be classified and referred to by Type (e.g., a “Eurodollar
Loan”). Borrowings also may be classified and referred to by Type (e.g., a
“Eurodollar Borrowing”).

Section 1.03 Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”. The word “will”
shall be construed to have the same meaning and effect as the word “shall”.
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
restated, supplemented or otherwise modified (subject to any restrictions on
such amendments, restatements, supplements or other modifications set forth
herein), (b) any reference herein to any Person shall be construed to include
such Person’s successors and assigns, (c) the words “herein”, “hereof” and
“hereunder”, and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement and (e) the words “asset” and “property” shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.

 

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Section 1.04 Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided that, if the
Borrower notifies the Administrative Agent that the Borrower requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith. Notwithstanding any
other provision contained herein, all terms of an accounting or financial nature
used herein shall be construed, and all computations of amounts and ratios
referred to herein shall be made, without giving effect to any election under
Financial Accounting Standards Board Accounting Standards Codification 825 (or
any other Financial Accounting Standard having a similar result or effect) to
value any Indebtedness or other liabilities of the Borrower or any Subsidiary at
“fair value”, as defined therein.

ARTICLE II.

The Loan

Section 2.01 Term Loan. Subject to the terms and conditions set forth herein,
each Lender severally agrees to make a term Loan in Dollars to the Borrower in
one advance made available to the Borrower on a Business Day before the
expiration of the Term Loan Availability Period in accordance with
Section 2.02(e) (the “Advance Date”), in a principal amount that will not result
in such Lender’s Term Loan exceeding such Lender’s Term Loan Commitment. Amounts
prepaid or repaid in respect of the Term Loan may not be reborrowed, and once
such Term Loan is made, no Lender is obligated to make any Loan that increases
the outstanding amount of its term loan hereunder. Unless previously terminated,
the Term Loan Commitments shall be reduced to zero and terminate immediately and
automatically upon the earlier of (a) the expiration of the Term Loan
Availability Period, and (b) the funding of the Term Loan.

Section 2.02 Loans and Borrowings.

(a) Loans Made Ratably. The Term Loan made on the Advance Date shall be made as
part of a Borrowing consisting of Loans of the same Type made by the Lenders
ratably in accordance with the Lenders’ Term Loan amounts as set forth on
Schedule 2.01. The failure of any Lender to make its ratable portion of the Term
Loan required to be made by it on the Advance Date shall not relieve any other
Lender of its obligations hereunder; provided that the obligations of the
Lenders are several and no Lender shall be responsible for any other Lender’s
failure to make its ratable portion of the Term Loan as required.

 

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(b) Loan Types. Subject to Section 2.10, each Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of this
Agreement.

(c) Minimum Amounts; Limitation on Eurodollar Borrowings. At the commencement of
each Interest Period for any Eurodollar Borrowing, such Borrowing shall be in an
aggregate amount that is an integral multiple of $1,000,000 and not less than
$5,000,000. At the time that each ABR Borrowing is made, such Borrowing shall be
in an aggregate amount that is an integral multiple of $1,000,000 and not less
than $5,000,000; provided that an ABR Borrowing may be in an aggregate amount
that is equal to the entire unused balance of the Term Loan. Borrowings of more
than one Type may be outstanding at the same time; provided that there shall not
at any time be more than a total of three Eurodollar Borrowings outstanding.

(d) Limitation on Interest Periods. Notwithstanding any other provision of this
Agreement, the Borrower shall not be entitled to request, or to elect to convert
or continue, any Borrowing if the Interest Period requested with respect thereto
would end after the Maturity Date.

(e) Request for Borrowing. With respect to the initial Term Loan made on the
Advance Date, the Borrower shall notify the Administrative Agent of its Term
Loan request by telephone (a) in the case of a Eurodollar Borrowing, not later
than 9:00 a.m., Dallas, Texas time, two Business Days before the date of the
proposed Borrowing, or (b) in the case of an ABR Borrowing, not later than 12:00
noon, Dallas, Texas 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 any form approved by the Administrative Agent and signed by
the Borrower. Such telephonic and written request shall specify the following
information in compliance with this Section and Section 2.04(f):

(i) 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 Borrowing, which shall be a Business Day;

(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and

(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period
to be applicable thereto after giving effect to such election, which shall be a
period contemplated by the definition of the term “Interest Period”.

If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month’s duration.

 

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Section 2.03 Funding of Borrowings.

(a) By Lenders. Each Lender shall make its ratable portion of the Term Loan to
be made by it hereunder on the Advance Date by wire transfer of immediately
available funds in Dollars to the account of the Administrative Agent most
recently designated by it for such purpose by notice to the Lenders. The
Administrative Agent will make the Term Loan available to the Borrower by
promptly crediting the amounts so received, in like funds, to an account of the
Borrower maintained with the Administrative Agent or by wire transfer, automated
clearing house debit or interbank transfer to such other account, accounts or
Persons designated by the Borrower in writing to the Administrative Agent.

(b) Fundings Assumed Made. Unless the Administrative Agent shall have received
notice from a Lender prior to the Advance Date that such Lender will not make
available to the Administrative Agent such Lender’s share of the Term Loan, the
Administrative Agent may assume that such Lender has made such share available
on the Advance Date in accordance with paragraph (a) of this Section and may, in
reliance upon such assumption, make available to the Borrower a corresponding
amount. In such event, if a Lender has not in fact made its share of the Term
Loan available to the Administrative Agent, then the applicable Lender and the
Borrower severally agree to pay to the Administrative Agent forthwith on demand
such corresponding amount with interest thereon, for each day from and including
the date such amount is made available to the Borrower to but excluding the date
of payment to the Administrative Agent, at (i) in the case of such Lender, the
greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation or (ii) in the case of the Borrower, the interest rate applicable
to ABR Loans. If such Lender pays such amount to the Administrative Agent, then
such amount shall constitute such Lender’s ratable portion of the Term Loan.

Section 2.04 Interest Elections.

(a) Conversion and Continuation. Each Borrowing initially shall be of the Type
specified on in the initial borrowing request and, in the case of a Eurodollar
Borrowing, shall have an initial Interest Period as specified in connection with
the funding on the Advance Date. Thereafter, the Borrower may elect to convert
such Borrowing to a different Type or to continue such Borrowing and, in the
case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as
provided in this Section. The Borrower may elect different options with respect
to different portions of the affected Borrowing, in which case each such portion
shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing.

(b) Delivery of Interest Election Request. To make an election pursuant to this
Section, the Borrower shall notify the Administrative Agent of such election by
telephone (a) in the case of a Eurodollar Borrowing, not later than 12:00 noon,
Dallas, Texas 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,
Dallas, Texas time, one Business Day before the date of the proposed Borrowing.
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 the form of Exhibit D hereto or in any
other form approved by the Administrative Agent and signed by the Borrower.

 

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(c) Contents of Interest Election Request. Each telephonic and written Interest
Election Request shall specify the following information in compliance with
Section 2.02 and paragraph (f) of this Section:

(i) the Borrowing to which such Interest Election Request applies and, if
different options are being elected with respect to different portions thereof,
the portions thereof to be allocated to each resulting Borrowing (in which case
the information to be specified pursuant to clauses (iii) and (iv) below shall
be specified for each resulting Borrowing);

(ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;

(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and

(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period
to be applicable thereto after giving effect to such election, which shall be a
period contemplated by the definition of the term “Interest Period”.

If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month’s duration.

(d) Notice to the Lenders. Promptly following receipt of an Interest Election
Request, the Administrative Agent shall advise each Lender of the details
thereof and of such Lender’s portion of each resulting Borrowing.

(e) Automatic Conversion. If the Borrower fails to deliver a timely Interest
Election Request with respect to a Eurodollar Borrowing prior to the end of the
Interest Period applicable thereto, then, unless such Borrowing is repaid as
provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing.

(f) Limitations on Election. Notwithstanding any contrary provision hereof, if
an Event of Default exists and the Administrative Agent, at the request of the
Required Lenders, so notifies the Borrower, then, so long as an Event of Default
is continuing (i) no outstanding borrowing may be converted to or continued as a
Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be
converted to an ABR Borrowing at the end of the Interest Period applicable
thereto. A Borrowing may not be converted to or continued as a Eurodollar
Borrowing if after giving effect thereto the Interest Period therefor would end
after the Maturity Date.

 

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Section 2.05 Amortization and Maturity of Term Loan. The aggregate amount of the
Term Loan, and all other Obligations and other amounts outstanding hereunder and
under the other Loan Documents, shall be due and payable in full on the Maturity
Date.

Section 2.06 Repayment of Loans; Evidence of Debt.

(a) Promise to Pay. The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the ratable account of each Lender the then unpaid
principal amount of the portion of the Term Loan made by such Lender, and all
other outstanding Obligations and other amounts outstanding hereunder and under
the other Loan Documents, on the Maturity Date.

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

(c) Administrative Agent Records. The Administrative Agent shall maintain
accounts in which it shall record (i) the amount of each Loan made hereunder,
the Type thereof and the Interest Period applicable thereto, (ii) the amount of
any principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender’s share thereof.

(d) Prima Facie Evidence. 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 Borrower
to repay the Loans in accordance with the terms of this Agreement. In the event
of any conflict between the account and records maintained by any Lender and the
accounts and records of the Administrative Agent in respect of such matters, the
accounts and records maintained by the Administrative Agent shall control in the
absence of manifest error.

(e) Request for a Note. Any Lender may request that its portion of the Term Loan
made by it be evidenced by a promissory note. In such event, the Administrative
Agent shall prepare a promissory note which the Borrower shall execute and
deliver to the requesting Lender and its registered assigns. Thereafter, the
Loans evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 10.04) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein and its registered assigns.

Section 2.07 Prepayment of Loans.

(a) Optional Prepayment. The Borrower shall have the right at any time and from
time to time to prepay any Borrowing in whole or in part, without prepayment
penalty or premium subject to the requirements of this Section and Section 2.12;
provided that amounts repaid or prepaid by the Borrower may not be reborrowed.

 

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(b) Selection of Borrowing to be Prepaid. Prior to any optional prepayment of
Borrowings hereunder, the Borrower shall select the Borrowing or Borrowings to
be prepaid and shall specify such selection in the notice of such prepayment
pursuant to paragraph (c) of this Section.

(c) Notice of Prepayment; Application of Prepayments. The Borrower shall notify
the Administrative Agent by telephone (confirmed by telecopy) of any prepayment
hereunder (i) in the case of prepayment of a Eurodollar Borrowing, not later
than 12:00 noon, Dallas, Texas time, three Business Days before the date of
prepayment, (ii) in the case of prepayment of an ABR Borrowing, not later than
12:00 noon, Dallas, Texas time, on the date of prepayment. Each such notice
shall be irrevocable and shall specify the prepayment date, the principal amount
of each Borrowing or portion thereof to be prepaid; provided, that, the Borrower
may rescind any such notice if such notice stated in writing that it was
conditioned on the occurrence of a specified event and such event shall not have
occurred. Promptly following receipt of any such notice, the Administrative
Agent shall advise the Lenders of the contents thereof. Each partial prepayment
of any Borrowing shall be in an amount that would be permitted in the case of an
advance of a Borrowing of the same Type as provided in Section 2.02. Each
prepayment of a Borrowing shall be applied ratably to the Loans included in the
prepaid Borrowing. Prepayments shall be accompanied by accrued interest to the
extent required by Section 2.12.

Section 2.08 Fees.

(a) Duration Fees. The Borrower shall pay to the Administrative Agent, for the
ratable account of each Lender, on each date set forth below a non-refundable
duration fee (the “Duration Fees”) as follows:

(i) on December 1, 2014, in an amount equal to the product of (i) 0.25% and
(ii) the aggregate principal amount of the Loans outstanding on such date; and

(ii) on January 20, 2015, in an amount equal to the product of (i) 0.50% and
(ii) the aggregate principal amount of the Loans outstanding on such date.

(b) Fee Letters. The Borrower agrees to pay to the Administrative Agent, for the
ratable account of the Lenders, all fees required by any fee letter executed
among the parties hereto.

(c) Payment of Fees. All fees payable hereunder shall be paid on the dates due,
in immediately available funds, to the Administrative Agent for ratable
distribution to the Lenders entitled thereto. Fees paid shall not be refundable
under any circumstances.

Section 2.09 Interest.

(a) ABR Borrowings. The Loans comprising each ABR Borrowing shall bear interest
at the Alternate Base Rate plus the Applicable Rate.

 

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(b) Eurodollar Borrowings. The Loans comprising each Eurodollar Borrowing shall
bear interest at the Adjusted LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Rate.

(c) Default Interest. Notwithstanding the foregoing, subject to Section 10.13,
if any principal of or interest on any Loan or any fee or other amount payable
by the Borrower hereunder is not paid when due, whether at stated maturity, upon
acceleration or otherwise, such overdue amount shall bear interest, after as
well as before judgment, at a rate per annum equal to (i) in the case of overdue
principal of any Loan, 2% 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. In addition, if any Event of Default exists and
the Required Lenders request, the outstanding principal amount of the Loans
shall bear interest, after as well as before judgment, as a rate per annum equal
to 2% plus the rate otherwise applicable to such Loan as provided in the
preceding paragraphs of this Section.

(d) Payment of Interest. Accrued interest on each Loan shall be payable in
arrears on each Interest Payment Date for such Loan and upon the Maturity Date;
provided that (i) interest accrued pursuant to paragraph (c) of this Section
shall be payable on demand, (ii) in the event of any repayment or prepayment of
any Loan, accrued interest on the principal amount repaid or prepaid shall be
payable on the date of such repayment or prepayment and (iii) in the event of
any conversion of any Eurodollar Loan prior to the end of the current Interest
Period therefor, accrued interest on such Loan shall be payable on the effective
date of such conversion.

(e) Computation. All interest hereunder shall be computed on the basis of a year
of 360 days, except that interest computed by reference to the Alternate Base
Rate at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Alternate Base Rate,
Adjusted LIBO Rate and Eurodollar Daily Floating Rate shall be determined by the
Administrative Agent, and such determination shall be conclusive absent manifest
error.

Section 2.10 Alternate Rate of Interest. If prior to the commencement of any
Interest Period for a Eurodollar Borrowing:

(a) the Administrative Agent determines (which determination shall be conclusive
absent manifest error) that adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period; or

(b) the Administrative Agent is advised by the Required Lenders that they have
determined in good-faith 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 (or Lender) of making or maintaining their Loans (or its
Loan) included in such Borrowing for such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone, or telecopy or other electronic transmission approved by
the Administrative Agent as promptly as practicable thereafter and, until the
Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, any Interest Election
Request that requests the conversion of any Borrowing to, or continuation of any
Borrowing as, a

 

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Eurodollar Borrowing shall be ineffective. The Required Lenders shall provide
the Borrower with documentation which reasonably supports their determination
referenced in the foregoing clause (b) promptly upon the Borrower’s request to
the Administrative Agent therefor.

Section 2.11 Increased Costs.

(a) Change In Law. If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, liquidity or
similar requirement (including any compulsory loan requirement, insurance charge
or other assessment) 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

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

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

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

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

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

(d) Limitation on Compensation. Failure or delay on the part of any Lender to
demand compensation pursuant to this Section shall not constitute a waiver of
such Lender’s right to demand such compensation; provided that the Borrower
shall not be required to compensate a Lender pursuant to this Section for any
increased costs or reductions incurred more

 

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than 90 days prior to the date that such Lender notifies the Borrower of the
Change in Law giving rise to such increased costs or reductions and of such
Lender’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 90-day period referred to above shall be extended to include the period
of retroactive effect thereof.

Section 2.12 Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default),
(b) the conversion of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any Loan on the date specified in any notice delivered pursuant hereto
(regardless of whether such notice may be revoked under Section 2.07 and is
revoked in accordance therewith), or (d) the assignment of any Eurodollar Loan
other than on the last day of the Interest Period applicable thereto as a result
of a request by the Borrower pursuant to Section 2.15, then, in any such event,
the Borrower shall compensate each Lender for the loss, cost and expense
attributable to such event. In the case of a Eurodollar Loan, such loss, cost or
expense to any Lender shall be deemed to include an amount determined by such
Lender to be the excess, if any, of (i) the amount of interest 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, 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 dollar deposits 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 shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender the amount
shown as due on any such certificate within 10 days after receipt thereof.

Section 2.13 Taxes.

(a) Payments Free of Taxes. Any and all payments by or on account of any
obligation of the Borrower under any Loan Document shall be made without
deduction or withholding for any Taxes, except as required by applicable law. If
any applicable law (as determined in the good faith discretion of an applicable
withholding agent) requires the deduction or withholding of any Tax from any
such payment by a withholding agent, then the applicable withholding agent shall
be entitled to make such deduction or withholding and shall timely pay the full
amount deducted or withheld to the relevant Governmental Authority in accordance
with applicable law and, if such Tax is an Indemnified Tax, then the sum payable
by the Borrower shall be increased as necessary so that after such deduction or
withholding has been made (including such deductions and withholdings applicable
to additional sums payable under this Section 2.13) the applicable Recipient
receives an amount equal to the sum it would have received had no such deduction
or withholding been made.

(b) Payment of Other Taxes. In addition, the Borrower shall timely pay to the
relevant Governmental Authority in accordance with applicable law, or at the
option of the Administrative Agent timely reimburse it for, Other Taxes.

 

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(c) Evidence of Payments. As soon as practicable after any payment of Taxes by
the Borrower to a Governmental Authority pursuant to this Section 2.13, the
Borrower shall deliver to the Administrative Agent the original or a certified
copy of a receipt issued by such Governmental Authority evidencing such payment,
a copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.

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

(e) Indemnification by the Lenders. Each Lender shall severally indemnify the
Administrative Agent, within 10 days after demand therefor, for (i) any
Indemnified Taxes attributable to such Lender (but only to the extent that the
Borrower has not already indemnified the Administrative Agent for such
Indemnified Taxes and without limiting the obligation of the Borrower to do so),
(ii) any Taxes attributable to such Lender’s failure to comply with the
provisions of Section 10.04(c) relating to the maintenance of a Participant
Register and (iii) any Excluded Taxes attributable to such Lender, in each case,
that are payable or paid by the Administrative Agent in connection with any Loan
Document, and any reasonable expenses arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority. A certificate as to the amount of such payment
or liability delivered to any Lender by the Administrative Agent shall be
conclusive absent manifest error. Each Lender hereby authorizes the
Administrative Agent to set off and apply any and all amounts at any time owing
to such Lender under any Loan Document or otherwise payable by the
Administrative Agent to the Lender from any other source against any amount due
to the Administrative Agent under this paragraph (e).

(f) Status of Lenders.

(i) Any Lender that is entitled to an exemption from or reduction of withholding
Tax with respect to payments made under any Loan Document shall deliver to the
Borrower (with a copy to the Administrative Agent), at the time or times
reasonably requested by the Borrower or the Administrative Agent and at the time
or times prescribed by applicable law, such properly completed and executed
documentation reasonably requested by the Borrower or the Administrative Agent
or prescribed by applicable law, as will permit such payments to be made without
withholding or at a reduced rate of withholding. In addition, any Lender, if
reasonably requested by the Borrower or the Administrative Agent, shall deliver
such other documentation prescribed by applicable law or reasonably requested by
the Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements. Notwithstanding
anything to the contrary in the preceding two sentences, the completion,
execution and submission of such documentation (other than such documentation
set forth in Section 2.13(f)(ii)(A), (f)(ii)(B) and (f)(ii)(D) below) shall not
be required if in the Lender’s reasonable judgment such completion, execution or
submission would subject such Lender to any material unreimbursed cost or
expense or would materially prejudice the legal or commercial position of such
Lender.

 

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(ii) Without limiting the generality of the foregoing,

(A) any Lender that is a U.S. person (within the meaning of Section 7701(a)(3)
of the Code) shall deliver to the Borrower and the Administrative Agent on or
prior to the date on which such Lender becomes a Lender under this Agreement
(and from time to time thereafter upon the reasonable request of the Borrower or
the Administrative Agent), executed originals of IRS Form W-9 (or successor
form) certifying that such Lender is exempt from U.S. federal backup withholding
tax;

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

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

(II) executed originals of IRS Form W-8ECI (or successor form);

(III) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code, (x) a certificate
substantially in the form of Exhibit E-1 to the effect that such Foreign Lender
is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10
percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B)
of the Code, or a “controlled foreign corporation” described in
Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and
(y) executed originals of IRS Form W-8BEN or W-8BEN-E, as applicable (or
successor form); or

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

(C) any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies

 

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as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), executed originals of any other form prescribed by applicable law as a
basis for claiming exemption from or a reduction in U.S. federal withholding
Tax, duly completed, together with such supplementary documentation as may be
prescribed by applicable law to permit the Borrower or the Administrative Agent
to determine the withholding or deduction required to be made; and

(D) if a payment made to a Lender under any Loan Document would be subject to
U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to
comply with the applicable reporting requirements of FATCA (including those
contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender
shall deliver to the Borrower and the Administrative Agent at the time or times
prescribed by law and at such time or times reasonably requested by the Borrower
or the Administrative Agent such documentation prescribed by applicable law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrower or the
Administrative Agent as may be necessary for the Borrower and the Administrative
Agent to comply with their obligations under FATCA and to determine that such
Lender has complied with such Lender’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment. Solely for purposes of this
clause (D), “FATCA” shall include any amendments made to FATCA after the date of
this Agreement.

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

(g) Treatment of Certain Refunds. If any party determines, in its sole
discretion exercised in good faith, that it has received a refund of any Taxes
as to which it has been indemnified pursuant to this Section 2.13 (including by
the payment of additional amounts pursuant to this Section 2.13), it shall pay
to the indemnifying party an amount equal to such refund (but only to the extent
of indemnity payments made under this Section with respect to the Taxes giving
rise to such refund), net of all out-of-pocket expenses (including Taxes) of
such indemnified party and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund). Such indemnifying
party, upon the request of such indemnified party, shall repay to such
indemnified party the amount paid over pursuant to this paragraph (g) (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) in the event that such indemnified party is required to repay such
refund to such Governmental Authority. Notwithstanding anything to the contrary
in this paragraph (g), in no event will the indemnified party be required to pay
any amount to an indemnifying party pursuant to this paragraph (g) the payment
of which would place the indemnified party in a less favorable net after-Tax
position than the indemnified party would have been in if the Tax subject to
indemnification and giving rise to such refund had not been deducted, withheld
or otherwise imposed and the indemnification payments or additional amounts with
respect to such Tax had never been paid. This paragraph shall not be construed
to require any indemnified party to make available its Tax returns (or any other
information relating to its Taxes that it deems confidential) to the
indemnifying party or any other Person.

(h) Survival. Each party’s obligations under this Section 2.13 shall survive the
resignation or replacement of the Administrative Agent or any assignment of
rights by, or the replacement of, a Lender, and the repayment, satisfaction or
discharge of all obligations under any Loan Document.

(i) Defined Terms. For purposes of this Section 2.13, the term “applicable law”
includes FATCA.

 

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Section 2.14 Payments Generally; Pro Rata Treatment; Sharing of Set-Offs;
Proceeds of Guaranty Agreement.

(a) Payments Generally. The Borrower shall make each payment required to be made
by it hereunder or under any other Loan Document (whether of principal,
interest, fees, or of amounts payable under Section 2.11, 2.12 or 2.13, or
otherwise) prior to the time expressly required hereunder or under such other
Loan Document for such payment (or, if no such time is expressly required, prior
to 12:00 noon, Dallas, Texas time), on the date when due, in immediately
available funds, without 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 pursuant to the payment instructions provided by the
Administrative Agent, except that payments pursuant to Sections 2.11, 2.12, 2.13
and 10.03 shall be made directly to the Persons entitled thereto and payments
pursuant to other Loan Documents shall be made to the Persons specified therein.
The Administrative Agent shall distribute any such payments received by it for
the account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment under any Loan Document shall be due on a day
that is not a Business Day, the date for payment shall be extended to the next
succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension. All payments
under each Loan Document shall be made in Dollars.

(b) Pro Rata Application. If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
interest and fees then due hereunder, such funds shall be applied (i) first,
towards payment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (ii) second, towards payment of principal then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal then due to such parties.

(c) Sharing of Set-offs. 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 Loans resulting in such Lender receiving payment of a
greater proportion of the aggregate amount of its 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 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 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 shall not be construed to apply to any payment made
by the Borrower pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans to any assignee or
participant, other than to the Borrower or any Subsidiary or Affiliate thereof
(as to which the provisions of this paragraph shall apply). The Borrower
consents to the foregoing and agrees, to the extent it may effectively do so

 

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under applicable law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation.

(d) Payments from Borrower Assumed Made. Unless the Administrative Agent shall
have received notice from the Borrower prior to the date on which any payment is
due to the Administrative Agent for the account of the Lenders hereunder that
the Borrower will not make such payment, the Administrative Agent may assume
that the Borrower has made such payment on such date in accordance herewith and
may, in reliance upon such assumption, distribute to the Lenders the amount due.
In such event, if the Borrower has not in fact made such payment, then each of
the Lenders severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender 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) Set-Off Against Amounts Owed Lenders. If any Lender shall fail to make any
payment required to be made by it pursuant to this Agreement or any other Loan
Document, then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), (i) 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, and/or (ii) hold such amounts in a segregated account over which the
Administrative Agent shall have exclusive control as cash collateral for, and
application to, any future funding obligations of such Lender under any such
Section, in the case of each of clause (i) and (ii) above, in any order as
determined by the Administrative Agent in its discretion.

(f) Application of Proceeds of Guaranty Agreement. All amounts received under
the Guaranty Agreement shall first be applied as payment of the accrued and
unpaid fees of the Administrative Agent hereunder and then to all other unpaid
or unreimbursed Obligations (including reasonable attorneys’ fees and expenses)
owing to the Administrative Agent in its capacity as Administrative Agent only
and then any remaining amount of such proceeds shall be distributed:

(i) first, to the Lenders, pro rata in accordance with the respective unpaid
amounts of Loan Obligations, until all the Loan Obligations have been Fully
Satisfied; and

(ii) second, to the Secured Parties, pro rata in accordance with the respective
unpaid amounts of the remaining Obligations.

(g) Noncash Proceeds. Notwithstanding anything contained herein to the contrary,
if the Administrative Agent shall ever acquire any collateral through
foreclosure or by a conveyance in lieu of foreclosure or by retaining any of the
collateral in satisfaction of all or part of the Obligations or if any proceeds
received by the Administrative Agent to be distributed and shared pursuant to
this Section 2.14 are in a form other than immediately available funds, the
Administrative Agent shall not be required to remit any share thereof under the
terms hereof and the Secured Parties shall only be entitled to their undivided
interests in the collateral or noncash proceeds as determined by paragraph (f)
of this Section 2.14. The Secured Parties shall receive

 

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the applicable portions (in accordance with the foregoing paragraph (f)) of any
immediately available funds consisting of proceeds from such collateral or
proceeds of such noncash proceeds so acquired only if and when received by the
Administrative Agent in connection with the subsequent disposition thereof.
While any collateral or other property to be shared pursuant to this Section is
held by the Administrative Agent pursuant to this clause (g), the Administrative
Agent shall hold such collateral or other property for the benefit of the
Secured Parties and all matters relating to the management, operation, further
disposition or any other aspect of such collateral or other property shall be
resolved by the agreement of the Required Lenders.

(h) Return of Proceeds. If at any time payment, in whole or in part, of any
amount distributed by the Administrative Agent hereunder is rescinded or must
otherwise be restored or returned by the Administrative Agent as a preference,
fraudulent conveyance, or otherwise under any bankruptcy, insolvency, or similar
law, then each Person receiving any portion of such amount agrees, upon demand,
to return the portion of such amount it has received to the Administrative
Agent.

Section 2.15 Mitigation Obligations; Replacement of Lenders.

(a) Mitigation. If any Lender requests compensation under Section 2.11, or if
the Borrower is required to pay any Indemnified Taxes or additional amounts to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 2.13, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 2.11 or 2.13,
as the case may be, in the future and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender. The Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or assignment.

(b) Replacement. If any Lender requests compensation under Section 2.11, or if
the Borrower is required to pay any Indemnified Taxes or additional amounts to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 2.13, or if any Lender becomes a Defaulting Lender, then the Borrower
may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 10.04), all its interests, rights (other than its exiting rights to
payments pursuant to Sections 2.11 and 2.04) and obligations under this
Agreement to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment); provided that (i) the
Borrower shall have received the prior written consent of the Administrative
Agent, 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, accrued interest thereon, accrued fees and all other amounts payable to
it hereunder, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts),
and (iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.11 or payments required to be made pursuant to
Section 2.13, such assignment will result in a reduction in such compensation or
payments. A Lender shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.

 

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Section 2.16 Defaulting Lenders. Notwithstanding any provision of this Agreement
to the contrary, if any Lender becomes a Defaulting Lender, then, for so long as
such Lender is a Defaulting Lender, the Loans or unused Term Loan Commitments,
as applicable, of such Defaulting Lender shall not be included in determining
whether the Required Lenders have taken or may take any action hereunder
(including any consent to any amendment, waiver or other modification pursuant
to Section 10.02); provided that this clause shall not apply to the vote of a
Defaulting Lender in the case of an amendment, waiver or other modification
requiring the consent of such Lender or each Lender affected thereby.

ARTICLE III.

Representations and Warranties

In order to induce the Administrative Agent and the Lenders to enter into this
Agreement and to make Loans hereunder, the Borrower represents and warrants to
the Administrative Agent and the Lenders that:

Section 3.01 Organization; Powers. Each of the Borrower and its Material
Subsidiaries is (i) duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (ii) has all requisite power
and authority to carry on its business as now conducted, and (iii) is qualified
to do business, and is in good standing, in every jurisdiction where such
qualification is required except, in the case of (ii) or (iii) above, where the
failure to do so qualify could not reasonably be expected to result in a
Material Adverse Effect.

Section 3.02 Authorization; Enforceability. The Transactions to be entered into
by each Loan Party are within such Loan Party’s corporate, partnership or
limited liability company powers (as applicable) and have been duly authorized
by all necessary corporate, partnership or limited liability action (as
applicable) and, if required, all stockholder action. This Agreement has been
duly executed and delivered by the Borrower and constitutes, and each other Loan
Document to which any Loan Party is to be a party, when executed and delivered
by such Loan Party, will constitute, a legal, valid and binding obligation of
the Borrower or such Loan Party (as the case may be), enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law.

Section 3.03 Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority or any other Person, except such as have
been obtained or made and are in full force and effect, (b) will not violate any
applicable law or regulation or the charter, bylaws or other organizational
documents of the Borrower or any of its Subsidiaries or any order of any
Governmental Authority, (c) will not violate or result in a default under any
material indenture, agreement or other instrument binding upon the Borrower or
any of its Subsidiaries or its assets (including the documentation governing

 

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the Senior Unsecured Notes), or give rise to a right thereunder to require any
payment to be made by the Borrower or any of its Subsidiaries, and (d) will not
result in the creation or imposition of any Lien on any asset of the Borrower or
any of its Subsidiaries.

Section 3.04 Financial Condition; No Material Adverse Change.

(a) The Borrower has heretofore publicly filed with the SEC via the EDGAR filing
system its consolidated balance sheet and statements of income, stockholders
equity and cash flows (i) as of and for the fiscal year ended December 31, 2013,
reported on by KPMG LLP, independent public accountants, and (ii) as of and for
the fiscal quarter and the portion of the fiscal year ended June 30, 2014,
certified by its chief financial officer. Such financial statements present
fairly, in all material respects, the financial position and results of
operations and cash flows of the Borrower and its consolidated Subsidiaries as
of such dates and for such periods in accordance with GAAP, subject to year-end
audit adjustments and the absence of footnotes in the case of the statements
referred to in clause (ii) above.

(b) Except as disclosed in the financial statements referred to above or the
notes thereto and except for the Disclosed Matters, after giving effect to the
Transactions, the Borrower nor its Subsidiaries has, as of the Effective Date,
any material contingent liabilities, unusual long-term commitments or unrealized
losses.

(c) Since December 31, 2013, there has been no material adverse change in the
business, operations, affairs, financial condition, assets or properties of the
Borrower and the Subsidiaries, taken as a whole.

Section 3.05 Properties.

(a) Each of the Borrower and its Subsidiaries has good title to, or valid
leasehold interests in, all its real and personal property necessary or material
to its business in the ordinary course, except for such defects in title that
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

(b) Each of the Borrower and its Subsidiaries owns, or is licensed to use, all
trademarks, tradenames, copyrights, patents and other intellectual property used
in its business in the ordinary course, and the use thereof by the Borrower and
its Subsidiaries does not infringe upon the rights of any other Person, except
as, individually or in the aggregate, could not reasonably be expected to result
in a Material Adverse Effect.

(c) As of the Effective Date, neither the Borrower nor any of its Subsidiaries
has received notice of, or has knowledge of, any pending or contemplated
condemnation proceeding affecting any fee-owned real property or any sale or
disposition thereof in lieu of condemnation.

Section 3.06 Litigation and Environmental Matters.

(a) Except for the Disclosed Matters, there are no actions, suits or proceedings
by or before any arbitrator or Governmental Authority pending against or, to the

 

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knowledge of the Borrower, threatened against or affecting the Borrower or any
of its Subsidiaries (i) as to which there is a reasonable possibility of an
adverse determination and that, if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect (other than the Disclosed Matters) or (ii) that involve any of the Loan
Documents or the Transactions.

(b) Except for the Disclosed Matters and except with respect to any other
matters that, individually or in the aggregate, could not reasonably be expected
to result in a Material Adverse Effect, neither the Borrower nor any of its
Subsidiaries (i) has failed to comply with any Environmental Law or to obtain,
maintain or comply with any permit, license or other approval required under any
Environmental Law, (ii) has become subject to any Environmental Liability,
(iii) has received notice of any claim with respect to any Environmental
Liability or (iv) knows of any reasonable basis for any Environmental Liability.

(c) The Disclosed Matters, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. Since the
Effective Date, there has been no change in the status of the Disclosed Matters
that, individually or in the aggregate, has resulted in, or materially increased
the likelihood of, a Material Adverse Effect.

Section 3.07 Compliance with Laws and Agreements. Each of the Borrower and its
Subsidiaries is in compliance with all laws, regulations and orders of any
Governmental Authority applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except in
instances where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect. No Default
has occurred and is continuing.

Section 3.08 Investment Company Status. Neither the Borrower nor any of its
Subsidiaries is an “investment company” as defined in, or subject to regulation
under, the Investment Company Act of 1940.

Section 3.09 Taxes. Each of the Borrower and its Subsidiaries has timely filed
or caused to be filed all Tax returns and reports required to have been filed
and has paid or caused to be paid all Taxes required to have been paid by it,
except (a) Taxes that are being contested in good faith by appropriate
proceedings and for which the Borrower or such Subsidiary, as applicable, has
set aside on its books adequate reserves or (b) to the extent that the failure
to do so could not reasonably be expected to result in a Material Adverse
Effect.

Section 3.10 ERISA. As of the Effective Date, (a) no ERISA Event has occurred or
is reasonably expected to occur that, when taken together with all other such
ERISA Events for which liability is reasonably expected to occur, could
reasonably be expected to result in a Material Adverse Effect and (b) the
present value of all accumulated benefit obligations of all underfunded Plans
(based on the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $100,000,000 the fair
market value of the assets of all such underfunded Plans.

 

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Section 3.11 Disclosure. The Borrower has disclosed to the Lenders all
agreements, instruments and corporate or other restrictions to which the
Borrower or any of its Subsidiaries is subject, and all other matters known to
any of them, that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. None of the reports, financial
statements, certificates or other information furnished by or on behalf of any
Loan Party to the Administrative Agent or any Lender in connection with the
negotiation of this Agreement or any other Loan Document or delivered hereunder
or thereunder (as modified or supplemented by other information so furnished)
contains any material misstatement of fact or omits to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided that, with respect to any
information consisting of forward-looking statements, estimates projections and
projected financial information, the Borrower represents only that such
information was prepared in good faith based upon assumptions believed to be
reasonable at the time, it being understood that such forward-looking
statements, estimates, projections and projected financial information are
subject to significant uncertainties and contingencies, many of which are beyond
the control of the Borrower or any of its Subsidiaries and no assurance can be
given that such forward-looking statements, estimates, projections and projected
financial information will be realized.

Section 3.12 Material Subsidiaries. As of the Effective Date, the Borrower has
no Material Subsidiaries other than those listed on Schedule 3.12 hereto. As of
the Effective Date, Schedule 3.12 sets forth the jurisdiction of incorporation
or organization of each such Material Subsidiary, the percentage of Borrower’s
ownership of the outstanding Equity Interests of each Material Subsidiary
directly owned by Borrower, and the percentage of each Material Subsidiary’s
ownership of the outstanding Equity Interests of each other Material Subsidiary.
All of the outstanding Equity Interest of Borrower and each Material Subsidiary
have been validly issued, are fully paid, and are nonassessable. Except as
permitted to be issued or created pursuant to the terms hereof (including stock
options or other equity based awards granted to officers, directors, employees
and consultants of the Borrower or any Subsidiary) or as reflected on
Schedule 3.12, there are no outstanding subscriptions, options, warrants, calls,
or rights (including preemptive rights) to acquire, and no outstanding
securities or instruments convertible into any Equity Interests of the Borrower
or any Material Subsidiary.

Section 3.13 Insurance. Each of the Borrower and the Subsidiaries maintain with
financially sound and reputable insurers, insurance with respect to its
properties and business against such casualties and contingencies and in such
amounts as are usually carried by businesses engaged in similar activities as
the Borrower and the Subsidiaries and located in similar geographic areas in
which the Borrower and the Subsidiaries operate

Section 3.14 Labor Matters. As of the Effective Date, except where
non-compliance cannot reasonably be expected to have a Material Adverse Effect,
(i) the hours worked by and payments made to employees of the Borrower and the
Subsidiaries have not been in violation of the Fair Labor Standards Act or any
other applicable Federal, state, local or foreign law dealing with such matters,
and (ii) all payments due from the Borrower or any Subsidiary, or for which any
claim may be made against the Borrower or any Subsidiary, 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 the Borrower or such Subsidiary. As of
the Effective Date, there are no strikes, lockouts or slowdowns against the
Borrower or any Subsidiary pending or, to the knowledge of

 

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the Borrower, threatened which could reasonably be expected to result in a
Material Adverse Effect. The consummation of the Transactions will not give rise
to any right of termination or right of renegotiation on the part of any union
under any collective bargaining agreement to which the Borrower or any
Subsidiary is bound.

Section 3.15 Solvency. Immediately after the consummation of the Transactions to
occur on the Effective Date and immediately following the making of each Loan
made on the Effective Date and after giving effect to the application of the
proceeds of such Loans, (a) the fair value of the assets of each Loan Party, at
a fair valuation, will exceed its debts and liabilities, subordinated,
contingent or otherwise; (b) the present fair saleable value of the property of
each Loan Party will be greater than the amount that will be required to pay the
probable liability of its debts and other liabilities, subordinated, contingent
or otherwise, as such debts and other liabilities become absolute and matured;
(c) each Loan Party will be able to pay its debts and liabilities, subordinated,
contingent or otherwise, as such debts and liabilities become absolute and
matured; and (d) each Loan Party will not have unreasonably small capital with
which to conduct the business in which it is engaged as such business is now
conducted and is proposed to be conducted following the Effective Date. As used
in this Section 3.15, the term “fair value” means the amount at which the
applicable assets would change hands between a willing buyer and a willing
seller within a reasonable time, each having reasonable knowledge of the
relevant facts, neither being under any compulsion to act, with equity to both
and “present fair saleable value” means the amount that may be realized if the
applicable company’s aggregate assets are sold with reasonable promptness in an
arm’s length transaction under present conditions for the sale of a comparable
business enterprises.

Section 3.16 Margin Securities. The Borrower is not engaged principally, or as
one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying margin stock (within the meaning of
Regulations U or X of the Board of Governors of the Federal Reserve System),
and, except for the repurchases of the Borrower’s capital stock in accordance
with the limitations in Section 5.10 and Section 6.08, no part of the proceeds
of any Loan will be used to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying margin stock.

Section 3.17 Anti-Corruption Laws and Sanctions. The Borrower has implemented
and maintains in effect policies and procedures designed to ensure compliance by
the Borrower, its Subsidiaries and their respective directors, officers,
employees and agents with Anti-Corruption Laws and applicable Sanctions, and the
Borrower, its Subsidiaries and their respective officers and employees and to
the knowledge of the Borrower its directors and agents, are in compliance with
Anti-Corruption Laws and applicable Sanctions in all material respects. None of
(a) the Borrower, any Subsidiary or any of their respective directors, officers
or employees, or (b) to the knowledge of the Borrower, any agent of the Borrower
or any Subsidiary that will act in any capacity in connection with or benefit
from the credit facility established hereby, is a Sanctioned Person. No
Borrowing, use of proceeds or other transaction contemplated by this Agreement
will violate any Anti-Corruption Law or applicable Sanctions.

 

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ARTICLE IV.

Conditions

Section 4.01 Conditions of Credit Extension. The effectiveness of this Agreement
to obligate the Lenders to make the Term Loan hereunder is subject to the
satisfaction of the following conditions:

(a) Execution and Delivery of This Agreement. 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 or other
electronic transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement.

(b) Guaranty Agreement. The Administrative Agent (or its counsel) shall have
received from each Subsidiary Guarantor either (i) a counterpart of the Guaranty
Agreement signed on behalf of such party or (ii) written evidence satisfactory
to the Administrative Agent (which may include telecopy or other electronic
transmission of a signed signature page of this Agreement) that such party has
signed a counterpart of the Guaranty Agreement.

(c) Legal Opinion. The Administrative Agent shall have received a favorable
written opinion (addressed to the Administrative Agent and the Lenders and dated
the Effective Date) of counsel for the Loan Parties covering the matters set
forth in Sections 3.01, 3.02 and 3.03 of this Agreement, such other matters
relating to the Loan Parties, the Loan Documents or the Transactions as the
Required Lenders shall reasonably request. The Loan Parties hereby request such
counsel to deliver such opinions.

(d) Corporate Authorization Documents. The Administrative Agent shall have
received such documents and certificates as the Administrative Agent or its
counsel may reasonably request relating to the organization, existence and good
standing of each Loan Party, the authorization of the Transactions and any other
legal matters relating to the Loan Parties, the Loan Documents or the
Transactions, all in form and substance satisfactory to the Administrative Agent
and its counsel.

(e) Closing Certificate. The Administrative Agent shall have received a
certificate, dated the Effective Date and signed by the President, a Vice
President or a Financial Officer of the Borrower, confirming that

(i) The representations and warranties of each Loan Party set forth in the Loan
Documents shall be true and correct in all material respects (except for any
representation and warranty that is qualified by materiality or Material Adverse
Effect, which representation and warranty shall be true and correct in all
respects) on and as of the Effective Date, except to the extent such
representations and warranties specifically relate to any earlier date in which
case such representations and warranties shall have been true and correct in all
material respects (except for any representation and warranty that is qualified
by materiality or Material Adverse Effect, which representation and warranty
shall be true and correct in all respects), as of such earlier date; and

(ii) At the time of and immediately after giving effect to such Borrowing on the
Effective Date, no Default shall exist.

 

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(f) The Administrative Agent shall have received from the Borrower a duly
completed and executed pro forma compliance certificate in the form of Exhibit B
hereto, computed by the Borrower as of the Effective Date (x) using the
Borrower’s and its Subsidiaries’ actual Total Indebtedness on the Effective Date
(but giving pro forma effect to the making of the Term Loan) and (y) using the
Borrower’s and its Subsidiaries’ Adjusted EBITDA as of September 30, 2014, in
each case

(i) demonstrating compliance with each of the terms of Article VII and

(ii) setting forth the Leverage Ratio to be used in determining the Applicable
Rate as of the Effective Date.

(g) Fee Letter and Fees. The Administrative Agent, the Lenders and the Borrower
shall have executed a fee letter agreed to among the parties hereto, and the
Administrative Agent shall have received for its the account and the account of
the Lenders, as applicable, all fees and other amounts due and payable pursuant
to such fee letter between the Borrower and Lenders, this Agreement or any other
Loan Document on or prior to the Effective Date, including, to the extent
invoiced, reimbursement or payment of all reasonable out-of-pocket expenses
required to be reimbursed or paid by the Borrower hereunder or under any other
Loan Document.

The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make the Term Loan hereunder
shall not become effective unless each of the foregoing conditions and each of
the conditions set forth in Section 4.02 is satisfied (or waived pursuant to
Section 10.02) at or prior to 3:00 p.m., Dallas, Texas time, on October 24, 2014
(and, in the event such conditions are not so satisfied or waived, the Lenders
shall have no obligation to fund the Term Loan hereunder).

Section 4.02 Conditions of Funding the Term Loan. The obligation of the Lenders
to make the Term Loan hereunder is subject to the further satisfaction of the
following conditions on the Advance Date:

(a) Representations and Warranties. The representations and warranties of each
Loan Party set forth in the Loan Documents shall be true and correct in all
material respects (except for any representation and warranty that is qualified
by materiality or Material Adverse Effect, which representation and warranty
shall be true and correct in all respects) on and as of the Advance Date, except
to the extent such representations and warranties specifically relate to any
earlier date in which case such representations and warranties shall have been
true and correct in all material respects (except for any representation and
warranty that is qualified by materiality or Material Adverse Effect, which
representation and warranty shall be true and correct in all respects), as of
such earlier date;

(b) Term Loan Commitments. At the time of and immediately after giving effect to
the making of the Term Loan, the total amount of the outstanding Term Loans
shall not exceed the total Term Loan Commitments of all Lenders; and

(c) No Default. At the time of and immediately after giving effect to the
Borrowing of the Term Loan, no Default shall exist.

 

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ARTICLE V.

Affirmative Covenants

Until the Loan Obligations have been Fully Satisfied, the Borrower covenants and
agrees with the Administrative Agent and the Lenders that:

Section 5.01 Financial Statements and Other Information. The Borrower will
furnish to the Administrative Agent:

(a) Annual Audit. Within 90 days after the end of each fiscal year of the
Borrower, its (i) audited consolidated balance sheet and related statements of
operations, stockholders’ equity and cash flows as of the end of and for such
year, setting forth in each case in comparative form the figures for the
previous fiscal year, and (ii) a report by KPMG LLP or other independent public
accountants of recognized national standing (without a “going concern” or like
qualification or exception and without any qualification or exception as to the
scope of such audit) to the effect that such consolidated financial statements
present fairly in all material respects the financial condition and results of
operations of the Borrower and its consolidated Subsidiaries on a consolidated
basis in accordance with GAAP consistently applied;

(b) Quarterly Financial Statements. Within 45 days after the end of each of the
first three fiscal quarters of each fiscal year of the Borrower, its unaudited
consolidated balance sheet and related statements of operations, stockholders’
equity and cash flows as of the end of and for such fiscal quarter and the then
elapsed portion of the fiscal year, setting forth in each case in comparative
form the figures for the corresponding period or periods of (or, in the case of
the balance sheet, as of the end of) the previous fiscal year, all certified by
one of its Financial Officers as presenting fairly in all material respects the
financial condition and results of operations of the Borrower and its
consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes;

(c) Compliance Certificate. Concurrently with any delivery of financial
statements under clause (a) or (b) above, a certificate in substantially the
form of Exhibit B hereto of a Financial Officer of the Borrower (or any other
form acceptable to the Administrative Agent) (i) certifying as to whether a
Default has occurred and, if a Default has occurred, specifying the details
thereof and any action taken or proposed to be taken with respect thereto,
(ii) setting forth reasonably detailed calculations demonstrating compliance
with Article VII, and (iii) stating whether any change in GAAP or in the
application thereof has occurred since the date of the Borrower’s audited
financial statements referred to in Section 3.04 and, if any such change has
occurred, specifying the effect of such change on the financial statements
accompanying such certificate;

(d) Debt Rating. Promptly upon receipt thereof, written notice of any downgrade
in any rating of the Borrower’s Indebtedness by Moody’s, S&P or any other rating
agency that issues rating for the Borrower’s Indebtedness;

(e) Senior Unsecured Notes. Promptly after such delivery or receipt, copies of
any financial or other report or notice delivered to, or received from, a holder
of a Senior Unsecured Note, which report or notice has not otherwise been
delivered to the Administrative Agent hereunder; and

(f) Additional Information. Promptly following any request therefor, such other
information regarding the operations, business affairs and financial condition
of the Borrower or any Subsidiary, or compliance with the terms of any Loan
Document, as the Administrative Agent or any Lender may reasonably request.

 

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Documents required to be delivered pursuant to clause (a) or (b) of this
Section 5.01 (to the extent any such documents are included in reports otherwise
filed with the SEC, or any Governmental Authority succeeding to any or all of
the functions of said Commission) shall be deemed to have been delivered to the
Administrative Agent and each Lender on the date the Borrower has filed such
reports with the SEC via the EDGAR filing system and the Borrower has notified
the Administrative Agent in writing of such posting (which notification may be
included in the certificate described in 5.01(c) above).

Section 5.02 Notices of Material Events. The Borrower will furnish to the
Administrative Agent and each Lender prompt written notice of the following:

(a) Default. The occurrence of any Default;

(b) Notice of Proceedings. The filing or commencement of any action, suit or
proceeding by or before any arbitrator or Governmental Authority against or
affecting the Borrower or any Affiliate thereof that, if adversely determined,
could reasonably be expected to result in a Material Adverse Effect;

(c) ERISA Event. The occurrence of any ERISA Event that, alone or together with
any other ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrower and its Subsidiaries in an aggregate amount
exceeding $1,000,000; and

(d) Material Adverse Effect. Any other development that results in, or could
reasonably be expected to result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.

Section 5.03 Existence; Conduct of Business. The Borrower will, and will cause
each of its Subsidiaries to, do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its (a) legal existence
(except with respect to a Subsidiary which is not a Material Subsidiary where
such failure could not be reasonably expected to result in Material Adverse
Effect) and (b) the rights, licenses, permits, privileges, franchises, patents,
copyrights, trademarks and trade names except where the failure to preserve,
renew or keep in force any such right, license, permit, privilege, franchise,
patent or copyright could not be reasonably expected to result in a Material
Adverse Effect; provided that the foregoing shall not prohibit any merger, sale,
consolidation, liquidation or dissolution permitted under Section 6.03 or
Section 6.05.

 

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Section 5.04 Payment of Obligations. The Borrower will, and will cause each of
its Subsidiaries to, pay its Indebtedness and other obligations, including Tax
liabilities, before the same shall become delinquent or in default, except where
(a) the validity or amount thereof is being contested in good faith by
appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on
its books adequate reserves with respect thereto in accordance with GAAP,
(c) such contest effectively suspends collection of the contested obligation and
the enforcement of any Lien securing such obligation and (d) the failure to make
payment pending such contest could not reasonably be expected to result in a
Material Adverse Effect.

Section 5.05 Maintenance of Properties. The Borrower will, and will cause each
of its Subsidiaries to, keep and maintain all property material to the conduct
of its business in good working order and condition, ordinary wear and tear
excepted.

Section 5.06 Insurance. The Borrower will, and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurance
companies insurance (or any self-insurance compatible with the following
standard) in such amounts (with no greater risk retention) and against such
risks as are customarily maintained by companies of established repute engaged
in the same or similar businesses operating in the same or similar locations.
The Borrower will furnish to the Lenders, upon request of the Administrative
Agent, information in reasonable detail as to the insurance so maintained.

Section 5.07 Guarantee and Secure Loans Equally.

(a) If any Subsidiary (other than an Excluded Foreign Subsidiary) of the
Borrower shall guarantee the obligations of the Borrower under the Senior
Unsecured Notes or under any other agreement creating or evidencing Indebtedness
in excess of $50,000,000, the Borrower shall cause such Subsidiary to guarantee
the Obligations equally and ratably with any and all other obligations
guaranteed by such Subsidiary pursuant to documentation acceptable to the
Administrative Agent.

(b) If the Borrower shall create, assume or permit to exist any Lien upon any of
its property or assets, or permit any Subsidiary (other than an Excluded Foreign
Subsidiary) to create, assume, or permit any Lien upon any of its property or
assets, whether now owned or hereafter acquired, other than those Liens
permitted by Section 6.02, the Borrower shall promptly cause the Obligations to
be secured equally and ratably with (and with the same priority of) any and all
other Indebtedness so secured by the Borrower or such Subsidiary pursuant to
documentation acceptable to the Administrative Agent.

(c) In the event that the Borrower certifies to the Administrative Agent and the
Lenders in writing that (i) the Senior Unsecured Notes and all other documents
or agreements evidencing or otherwise relating to any Indebtedness of the
Borrower or any Subsidiary do not contain any covenant or agreement similar to
this Section 5.07 and (ii) no Indebtedness of the Borrower or any Subsidiary
(other than an Excluded Foreign Subsidiary) is secured by Liens other than Liens
permitted by Section 6.02, then this Section 5.07 shall automatically be deemed
to have no further force or effect without any action of the parties hereto. If,
subsequent to such certification from the Borrower, any agreement or document
related to any Indebtedness of the Borrower or any Subsidiary (other than an
Excluded Foreign Subsidiary) contains a covenant or agreement similar to this
Section 5.07, then this Section 5.07 shall automatically be reinstated and shall
be in full force and effect without any action of the parties hereto.

 

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Section 5.08 Books and Records; Inspection and Audit Rights. The Borrower will,
and will cause each of its Subsidiaries to, keep proper books of record and
accounts in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. If no Default or Event
of Default exists, at the expense of the Administrative Agent and the Lenders,
the Borrower will, and will cause each of its Subsidiaries to, permit any
representatives designated by the Administrative Agent or any Lender, upon
reasonable prior notice, to visit and inspect its properties, to examine and
make extracts from its books and records, subject to Section 10.12, and to
discuss its affairs, finances and condition with its officers and independent
accountants, all at such reasonable times during normal business hours, as often
as reasonably requested. If a Default or Event of Default exists, at the expense
of the Borrower, the Borrower will, and will cause each of its Subsidiaries to,
permit any representatives designated by the Administrative Agent or any Lender,
to visit and inspect its properties, to examine and make extracts from its books
and records, and to discuss its affairs, finances and condition with its
officers and independent accountants, all at such times and as often as
requested.

Section 5.09 Compliance with Laws. The Borrower will, and will cause each of its
Subsidiaries to, 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, could not reasonably be
expected to result in a Material Adverse Effect. The Borrower will maintain in
effect and enforce policies and procedures designed to ensure compliance by the
Borrower, its Subsidiaries and their respective directors, officers, employees
and agents with Anti-Corruption Laws and applicable Sanctions.

Section 5.10 Use of Proceeds. The proceeds of the Term Loan will be used only
for payment of fees and expenses payable in connection with the Transactions and
for working capital and other general corporate purposes of the Borrower and its
Subsidiaries. No part of the proceeds of any Loan will be used, whether directly
or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations G, U and X. The Borrower will
not request any Borrowing, and the Borrower shall not use, and shall cause its
Subsidiaries and its or their respective directors, officers, employees and
agents not to use, the proceeds of any Borrowing (A) in furtherance of an offer,
payment, promise to pay, or authorization of the payment or giving of money, or
anything else of value, to any Person in violation of any Anti-Corruption Laws,
(B) for the purpose of funding, financing or facilitating any activities,
business or transaction of or with any Sanctioned Person, or in any Sanctioned
Country, or (C) in any manner that would result in the violation of any
Sanctions applicable to any party hereto.

Section 5.11 New Material Subsidiaries. If as of a fiscal quarter end a
Subsidiary that is not party to the Guaranty Agreement is a Material Subsidiary,
then within 45 days after the end of such fiscal quarter the Borrower shall:
(i) cause each such Subsidiary to become a party to the Guaranty Agreement
pursuant to the execution and delivery of a Subsidiary Joinder Agreement (as
defined in the Guaranty Agreement); (ii) cause each such Subsidiary to execute
and/or deliver such other documentation as the Administrative Agent may
reasonably request to evidence the authority of each such Subsidiary to execute,
deliver and perform the Guaranty Agreement and to evidence the existence and
good standing of each such Subsidiary; and (iii) deliver a favorable written
opinion (addressed to the Administrative Agent and the

 

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Lenders) of counsel to each such Subsidiary covering the matters set forth in
Sections 3.01, 3.02 and 3.03 of this Agreement and such other matters relating
to each such Subsidiary and the Loan Documents as the Administrative Agent shall
reasonably request. The Borrower requests each such counsel to deliver such
opinions.

Section 5.12 Further Assurances. The Borrower will, and will cause each
Subsidiary Guarantor to, execute any and all further documents, agreements and
instruments, and take all such further actions, which may be required under any
applicable law or which the Administrative Agent or the Required Lenders may
reasonably request, to effectuate the transactions contemplated by the Loan
Documents, all at the expense of the Loan Parties.

Section 5.13 Post-Closing Covenant. Within fifteen days after the Effective
Date, the Borrower will deliver to the Administrative Agent the foreign
qualification certificates for (a) Allied Air Enterprises LLC from the state of
South Carolina and (b) Lennox National Account Services LLC from the states of
Texas, California and Michigan.

ARTICLE VI.

Negative Covenants

Until the Loan Obligations have been Fully Satisfied, the Borrower covenants and
agrees with the Administrative Agent and the Lenders that:

Section 6.01 Indebtedness; Certain Equity Securities. The Borrower will not, and
will not permit any Subsidiary to, create, incur, assume or permit to exist any
Indebtedness, except:

(a) Indebtedness created under the Loan Documents;

(b) Indebtedness created under the Bank Facility and any other “Obligations” as
defined in the Bank Facility; provided any Indebtedness under the Bank Facility
shall be in the amount and in accordance with the terms and conditions in effect
on the Effective Date;

(c) Indebtedness existing on the date hereof and set forth in Schedule 6.01 and
extensions, renewals and replacements of any such Indebtedness that do not
increase the outstanding principal amount thereof or result in an earlier
maturity date or decreased weighted average life thereof;

(d) Indebtedness of the Borrower to any Subsidiary and of any Subsidiary to the
Borrower or any other Subsidiary; provided that Indebtedness of the Borrower or
any Subsidiary Guarantor owed to any Subsidiary that is not a Subsidiary
Guarantor shall be subordinate to the Obligations on terms, and pursuant to
documentation, reasonably satisfactory to the Administrative Agent;

(e) Guarantees by the Borrower or any Subsidiary of Indebtedness of the Borrower
or any Subsidiary which is otherwise permitted by this Section 6.01 (including,
without limitation, Guarantees of Indebtedness permitted under Section 6.01(b));

 

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(f) (i) Indebtedness of the Borrower and the Subsidiary Guarantors secured by
fixed or capital assets (including equipment), including Capital Lease
Obligations, (ii) Indebtedness of Subsidiaries of the Borrower that are not
Subsidiary Guarantors (including Foreign Subsidiaries) owed to an unrelated
third Person (other than any Receivable Securitization Outstandings) and
(iii) other Indebtedness of Subsidiary Guarantors owed to an unrelated third
Person; provided that the aggregate amount of Indebtedness permitted by this
clause (e) at any time outstanding shall not exceed an amount equal to 20% of
the Borrower’s and its Subsidiaries consolidated net worth (as determined in
accordance with GAAP);

(g) Indebtedness arising in connection with Swap Agreements permitted by
Section 6.07;

(h) to the extent constituting Indebtedness, deferred compensation payable to
directors, officers or employees of the Borrower and the Subsidiaries;

(i) cash management obligations and Indebtedness incurred by the Borrower or any
Subsidiary in respect of netting services, overdraft protections and similar
arrangements, in each case entered into in the ordinary course of business in
connection with cash management and deposit accounts and not involving the
borrowing of money;

(j) Receivable Securitization Outstandings in an aggregate principal amount not
to exceed $300,000,000;

(k) Indebtedness outstanding under the Senior Unsecured Notes on the Effective
Date (but specifically excluding any extensions, renewals, refinancings or
replacements of such Indebtedness); and

(l) unsecured Indebtedness of the Borrower in addition to that permitted by
other provisions of this Section 6.01 provided that (i) no Default has occurred
and is continuing at the time such unsecured Indebtedness is incurred or would
result from the incurrence thereof and (ii) after giving pro forma effect to
such unsecured Indebtedness, the Borrower shall be in compliance with the
financial covenants set out in Article VII as calculated for the four fiscal
quarter period most recently ended as if such unsecured Indebtedness had been
incurred as of the first date of such four fiscal quarter period (and to the
extent such Indebtedness bears interest at a floating rate, using the rate in
effect at the time of calculation for the entire period of calculation).

The Borrower will not permit any Subsidiary to issue any preferred stock or
other preferred Equity Interests unless such preferred Equity Interests are
issued to and at all times owned by the Borrower or another Loan Party.

Section 6.02 Liens. The Borrower will not, and will not permit any Subsidiary
to, create, incur, assume or permit to exist any Lien on any property or asset
now owned or hereafter acquired by it, or assign or sell any income or revenues
(including accounts receivable) or rights in respect of any thereof, except:

(a) Liens created under the Loan Documents;

(b) Permitted Encumbrances;

 

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(c) any Lien on any asset of the Borrower or any Subsidiary existing on the date
hereof and set forth in Schedule 6.02; provided that (i) such Lien shall not
apply to any other asset of the Borrower or any Subsidiary and (ii) such Lien
shall secure only those obligations which it secures on the date hereof and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;

(d) any Lien existing on any fixed or capital asset (including equipment) prior
to the acquisition thereof by the Borrower or any Subsidiary or existing on any
property or asset of any Person that becomes a Subsidiary after the date hereof
prior to the time such Person becomes a Subsidiary; provided that (i) such Lien
is not created in contemplation of or in connection with such acquisition or
such Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not
apply to any other assets of the Borrower or any Subsidiary, (iii) such Lien
shall secure only those obligations which it secures on the date of such
acquisition or the date such Person becomes a Subsidiary, as the case may be and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof, and (iv) the aggregate principal amount of
all Indebtedness secured by Liens permitted by this clause (d) shall not at any
time exceed $25,000,000;

(e) Liens on fixed or capital assets (including equipment) acquired, constructed
or improved by the Borrower or any Subsidiary; provided that (i) such security
interests secure Indebtedness permitted by subclause (i) of Section 6.01(f),
including Capital Lease Obligations, (ii) such security interests and the
Indebtedness secured thereby are incurred prior to or within 90 days after such
acquisition or the completion of such construction or improvement, (iii) the
Indebtedness secured thereby does not exceed 100% of the cost of acquiring,
constructing or improving such fixed or capital assets and (iv) such security
interests shall not apply to any other property or assets of the Borrower or any
Subsidiary;

(f) (i) Liens on property of the Borrower or any of its Subsidiaries securing
Indebtedness owing to a Loan Party permitted by Section 6.01(d) and (ii) Liens
on property of any Subsidiary that is not a Material Subsidiary securing
Indebtedness owing to any other Subsidiary that is not a Material Subsidiary
permitted by Section 6.01(d);

(g) Liens securing Indebtedness of Foreign Subsidiaries permitted by
subclause (ii) of Section 6.01(f) provided that such Liens encumber only assets
of the Foreign Subsidiaries;

(h) Liens granted in connection with any Receivable Securitization Facility
permitted hereunder on the receivables sold pursuant thereto (together with all
collections and other proceeds thereof and any collateral securing the payment
thereof), all right, title and interest in and to the lockboxes and other
collection accounts in which proceeds of such receivables are deposited, the
rights under the documents executed in connection with such Receivable
Securitization Facility and in the Equity Interests issued by any special
purpose entity organized to purchase the receivables thereunder;

(i) Liens on cash securing Indebtedness arising in connection with Swap
Agreements permitted by Section 6.07;

(j) Liens securing Indebtedness under the Bank Facility and any other
“Obligations”, as defined in the Bank Facility; provided that no Lien may secure
any obligations under the Bank Facility without securing all Obligations under
the Loan Documents on a basis at least pari passu with such Obligations; and

(k) other Liens not otherwise permitted by this Section 6.02 provided that the
aggregate book value of assets subject to the Liens permitted by this clause (k)
does not exceed $5,000,000 at any time.

 

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Section 6.03 Fundamental Changes.

(a) The Borrower will not, nor will it permit any Subsidiary to, merge into or
consolidate with any other Person, or permit any other Person to merge into or
consolidate with it, or liquidate or dissolve, except that, if at the time
thereof and immediately after giving effect thereto no Default shall have
occurred and be continuing (i) any Subsidiary may merge into the Borrower in a
transaction in which the Borrower is the surviving corporation, (ii) any
Subsidiary may merge into any Subsidiary in a transaction in which the surviving
entity is a Subsidiary and, if any party to such merger is a Subsidiary
Guarantor, is a Subsidiary Guarantor; (iii) any Subsidiary or the Borrower may
merge into another Person in connection with an acquisition permitted by
Section 6.04 as long as the Subsidiary or the Borrower is the surviving Person
and no Default exists or would result and (iv) any Subsidiary may liquidate,
dissolve or be transferred if the Borrower determines in good faith that such
liquidation, dissolution or transfer is in the best interests of the Borrower
and is not materially disadvantageous to the Lenders and if such Subsidiary is a
Subsidiary Guarantor, its assets are transferred to the Borrower or a Subsidiary
Guarantor; provided that any such merger involving a Person that is not a wholly
owned Subsidiary immediately prior to such merger shall not be permitted unless
also permitted by Section 6.04 or Section 6.05.

(b) The Borrower will not, and will not permit any of its Subsidiaries to,
engage to any material extent in any business other than businesses of the type
conducted by the Borrower and its Subsidiaries on the date of execution of this
Agreement and businesses reasonably related thereto.

Section 6.04 Investments, Loans, Advances and Acquisitions. The Borrower will
not, and will not permit any of its Subsidiaries to, purchase, hold or acquire
(including pursuant to any merger with any Person that was not a wholly owned
Subsidiary prior to such merger) any Equity Interests in or evidences of
indebtedness or other securities (including any option, warrant or other right
to acquire any of the foregoing) of, make or permit to exist any loans or
advances to, or make or permit to exist any investment or any other interest in,
any other Person, or purchase or otherwise acquire (in one transaction or a
series of transactions) any assets of any other Person constituting a business
unit, except:

(a) Permitted Investments;

(b) investments existing on the date hereof and set forth on Schedule 6.04;

(c) investments by the Borrower and its Subsidiaries in Equity Interests in
their respective Subsidiaries;

(d) loans or advances made by the Borrower to any Subsidiary and made by any
Subsidiary to the Borrower or any other Subsidiary; provided that such loans and
advances shall be subject to the conditions set forth in Section 6.01(d);

 

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

(f) notes and other non–cash consideration received as part of the purchase
price of assets disposed of pursuant to Section 6.05;

(g) extension of trade credit in the ordinary course of business;

(h) Swap Agreements permitted by Section 6.07;

(i) loans and advances to officers, directors, and employees of the Borrower and
the Subsidiaries made in the ordinary course of business for travel and
entertainment expenses, relocation costs and similar purposes up to a maximum
for all such loans and advances of $10,000,000 in the aggregate at any one time
outstanding;

(j) endorsements of items for collection or deposit in the ordinary course of
business;

(k) Borrower or a Subsidiary may purchase, hold or acquire (including pursuant
to a merger) all the Equity Interests in a Person and may purchase or otherwise
acquire (in one transaction or a series of transactions) all or substantially
all of the assets of any other Person or all or substantially all of the assets
of a division or branch of such Person, if, with respect to each such
acquisition:

(i) Default. No Default exists or would result therefrom;

(ii) Pro Forma Compliance. The Borrower shall be in compliance with the
covenants contained in Article VII on a pro forma basis for the four (4) fiscal
quarter period then most recently ending (assuming that the incurrence or
assumption of any Indebtedness in connection with the proposed purchase or
acquisition occurred on the first day of such period and to the extent such
Indebtedness bears interest at a floating rate, using the rate in effect at the
time of calculation for the entire period of calculation); and

(iii) Delivery and Notice Requirements. Borrower shall provide to Administrative
Agent, within five days after the consummation of any acquisition with a
purchase price in excess of $50,000,000, the following: (A) notice of the
acquisition and (B) a certificate signed by a Financial Officer of the Borrower
certifying: (1) that after giving effect to the acquisition in question, all
representations and warranties contained in the Loan Documents were true and
correct on and as of the date of the closing of the acquisition with the same
force and effect as if such representations and warranties had been made on and
as of such date, except to the extent that such representations and warranties
relate specifically to an earlier date (and such representations and warranties
were true and correct as of such earlier date); (2) that no Default exists or
will result from the acquisition; and (3) to the Borrower’s calculation of its
compliance with clause (ii) of this clause (k);

(l) investments in the Equity Interests in the special purpose entities
established in connection with any Receivable Securitization Facility provided
that the aggregate amount of cash invested by the Borrower and its Subsidiaries
in all such entities shall not exceed $1,000,000;

 

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(m) other investments not otherwise permitted by this Section 6.04 provided that
the aggregate book value of all investments made under the permissions of this
clause (m) does not exceed $1,000,000 at any time; and

(n) in addition to the investments otherwise permitted by this Section 6.04, the
Borrower and each Subsidiary may purchase, hold or acquire Equity Interests in
or other securities or assets of, make loans or advances to, or make any other
investment in, any other Person if (i) no Default exists or would result from
the making of such acquisition, loan, advance or investment and (ii) the
Borrower is in pro forma compliance with the financial covenants set forth in
Article VII for the four fiscal quarter period most recently ended after giving
effect to such acquisition, loan, advance or investment and after giving effect
to any Indebtedness incurred in connection therewith; provided, any acquisition
of all of the Equity Interests in a Person, or all or substantially all of the
assets of a Person, shall be subject to the terms of clause (k) of this
Section 6.04.

Section 6.05 Asset Sales. The Borrower will not, and will not permit any of the
Subsidiaries to, sell, transfer, lease or otherwise dispose of any asset,
including any Equity Interest owned by it, nor will the Borrower permit any of
its Subsidiaries to issue any additional Equity Interest in such Subsidiary,
except:

(a) sales, leases (or subleases), licenses (or sublicenses) or other transfers
and dispositions of inventory, used, worn-out, obsolete or surplus equipment,
property, property no longer needed or useful, and Permitted Investments, each
in the ordinary course of business, and sales of real estate to the extent such
property is exchanged for credit against the purchase price of similar
replacement property or the proceeds of such sale are reasonably promptly
applied to the purchase price of such replacement property;

(b) sales, transfers and other dispositions of receivables, or undivided
interests therein, together with all collections and other proceeds thereof and
any collateral securing the payment thereof pursuant to any Receivable
Securitization Facility;

(c) if Indebtedness under the Senior Unsecured Notes is outstanding,
dispositions of certain business segments (other than domestic heating, cooling
and refrigeration businesses) as long as (i) no Default exists or would result
from the making of such disposition, (ii) the book value of assets disposed of
by the Borrower and its Subsidiaries in any calendar year in reliance on this
clause (c) does not exceed ten percent (10%) of consolidated net assets of the
Borrower and its Subsidiaries, and (iii) the EBITDA attributable to the assets
disposed of by the Borrower and its Subsidiaries in reliance on this clause
(c) in any calendar year does not represent more than 5% of EBITDA of the
Borrower and its Subsidiaries for the prior calendar year;

(d) if Indebtedness under the Senior Unsecured Notes is outstanding, other
dispositions as long as (i) no Default exists or would result from the making of
such disposition, (ii) the book value of assets disposed of by the Borrower and
its Subsidiaries in any calendar year in reliance on this clause (d) does not
exceed five percent (5%) of consolidated net assets of the Borrower and its
Subsidiaries, and (iii) the EBITDA attributable to the assets disposed of by the
Borrower and its Subsidiaries in reliance on this clause (d) in any calendar
year does not represent more than 5% of EBITDA of the Borrower and its
Subsidiaries for the prior calendar year; and

(e) if no Indebtedness under the Senior Unsecured Notes is outstanding, other
dispositions of assets (including dispositions of certain businesses other than
domestic

 

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heating, cooling and refrigeration businesses) as long as (i) no Default exists
or would result from the making of such disposition and (ii) the total of any
EBITDA attributable to the assets disposed of by the Borrower and its
Subsidiaries in any calendar year in reliance on this clause (e) does not
represent more than 20% of EBITDA of the Borrower and its Subsidiaries for the
prior calendar year;

provided that all sales, transfers, leases and other dispositions permitted
hereby shall be made for fair value. Notwithstanding the foregoing, the Borrower
or any Subsidiary shall be permitted to make any sale, transfer, lease or
disposition of any asset otherwise prohibited by this Section 6.05, if within
one year of disposing of such asset, the Borrower or a Subsidiary of the
Borrower applies or commits to apply an amount equal to the fair market value of
such asset to: (a) redeem the Senior Unsecured Notes, (b) repay Indebtedness for
borrowed money having a maturity of more than twelve (12) months (other than any
Indebtedness owed to the Borrower or a Material Subsidiary), (c) acquire,
construct, develop or improve properties, facilities, or equipment of the
Borrower or any Material Subsidiary, or (d) any combination thereof.

Section 6.06 Sale and Leaseback Transactions. The Borrower will not, and will
not permit any of its Subsidiaries to, enter into any arrangement, directly or
indirectly, whereby it shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereinafter acquired, and
thereafter rent or lease such property or other property that it intends to use
for substantially the same purpose or purposes as the property sold or
transferred, except for (i) any such sale of any fixed or capital assets that is
made for cash consideration in an amount not less than the cost of such fixed or
capital asset and is consummated within 90 days after the Borrower or such
Subsidiary acquires or completes the construction of such fixed or capital
asset; and (ii) other sale and leaseback transactions, provided that any
Indebtedness that may be incurred with any such sale and leaseback transaction
is permitted under Section 6.01 and the assets to be sold in connection such
sale and leaseback transaction are permitted to be sold pursuant to
Section 6.05.

Section 6.07 Swap Agreements. The Borrower will not, and will not permit any of
its Subsidiaries to, enter into any Swap Agreement, except (a) Swap Agreements
entered into to hedge or mitigate risks to which the Borrower or any Subsidiary
has actual exposure (other than those in respect of Equity Interests of the
Borrower or any of its Subsidiaries), and (b) Swap Agreements entered into in
order to effectively cap, collar or exchange interest rates (from fixed to
floating rates, from one floating rate to another floating rate or otherwise)
with respect to any interest–bearing liability or investment of the Borrower or
any Subsidiary.

Section 6.08 Restricted Payments. The Borrower will not, nor will it permit any
Subsidiary to, declare or make, or agree to pay or make, directly or indirectly,
any Restricted Payment, or incur any obligation (contingent or otherwise) to do
so, except (a) Subsidiaries may declare and pay dividends ratably with respect
to their capital stock and (b) Borrower may make any Restricted Payment so long
as no Default exists or would result from the making of such Restricted Payment.

Section 6.09 Transactions with Affiliates. The Borrower will not, nor will it
permit any Subsidiary to, sell, lease or otherwise transfer (in a single
transaction or a series of related transactions) property or assets having an
aggregate book value in excess of $1,000,000

 

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to, or purchase, lease or otherwise acquire (in a single transaction or a series
of related transactions) property or assets having an aggregate book value in
excess of $1,000,000 from, or otherwise engage in any other transactions with,
any of its Affiliates, except (a) transactions in the ordinary course of
business that are at prices and on terms and conditions not less favorable to
the Borrower or such Subsidiary than could be obtained on an arm’s-length basis
from unrelated third parties, (b) transactions between or among the Borrower and
the Subsidiary Guarantors not involving any other Affiliate and (c) any
Restricted Payment permitted by Section 6.08.

Section 6.10 Restrictive Agreements. The Borrower will not, nor will it permit
any Subsidiary to, directly or indirectly, enter into, incur or permit to exist
any agreement or other arrangement that prohibits, restricts or imposes any
condition upon (a) the ability of the Borrower or any Subsidiary to create,
incur or permit to exist any Lien upon any of its property or assets, or (b) the
ability of any Subsidiary to pay dividends or other distributions with respect
to any shares of its capital stock or to make or repay loans or advances to the
Borrower or any other Subsidiary or to Guarantee Indebtedness of the Borrower or
any other Subsidiary; provided that:

(i) the foregoing shall not apply to restrictions and conditions imposed by law
or by any Loan Document,

(ii) the foregoing shall not apply to restrictions and conditions existing on
the date hereof identified on Schedule 6.10 (but shall apply to any extension or
renewal of, or any amendment or modification expanding the scope of, any such
restriction or condition),

(iii) the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to leases and other contracts restricting the
assignment thereof, or to agreement relating to the sale of a Subsidiary or any
asset or property pending such sale, provided such restrictions and conditions
apply only to the Subsidiary, asset or property that is to be sold and such sale
is permitted hereunder,

(iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Indebtedness,

(v) clause (a) of the foregoing shall not apply to customary provisions in
leases, licenses and other contracts restricting the assignment thereof,

(vi) clause (a) of the foregoing shall not apply to customary provisions in the
documentation evidencing any Receivable Securitization Facility that impose
restrictions on the ability of the special purpose entity party thereto to
declare, pay or set aside funds for the making of any distribution in respect of
the Equity Interests issued by such entity,

(vii) the foregoing shall not apply to restrictions or conditions with respect
to a Subsidiary that is not a Subsidiary on the Effective Date, provided that
such restrictions or conditions (A) are in existence at the time such Person
becomes a Subsidiary and are not incurred in connection with, or in
contemplation of, such Person becoming a Subsidiary and (B) apply only to such
Subsidiary and do not extend to the Borrower or any other Subsidiary or any of
their respective assets,

 

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(viii) the foregoing shall not apply to customary provisions contained in
agreements entered into in connection with Indebtedness owed by any Foreign
Subsidiary that impose restrictions on the ability of such Foreign Subsidiary to
grant Liens on its property to declare, pay or set aside funds for the making of
any distribution in respect of the Equity Interests issued by such Foreign
Subsidiary, and

(ix) the foregoing shall not apply to restrictions or conditions contained in
agreements evidencing, or executed in connection with, unsecured Indebtedness
permitted by Section 6.01(l) as long as such agreements do not prohibit (A) the
Obligations to be secured on a pari passu basis and (B) Liens on assets of the
Borrower and its Subsidiaries on terms substantially similar to (and no more
restrictive than) the terms of Section 6.02 hereof.

Section 6.11 Amendment of Material Documents. The Borrower will not, nor will it
permit any Subsidiary to, amend, modify or waive any of its rights under (a) its
certificate of incorporation, by-laws or other organizational documents in a
manner adverse to the Administrative Agent or the Lenders or (b) the Senior
Unsecured Notes.

Section 6.12 Change in Fiscal Year. The Borrower will not change the manner in
which the last day of its fiscal year is calculated.

ARTICLE VII.

Financial Covenants

Until the Loan Obligations have been Fully Satisfied, the Borrower covenants and
agrees with the Administrative Agent and the Lenders that:

Section 7.01 Leverage Ratio. As of the last day of each fiscal quarter, the
Borrower shall not permit the ratio of Total Indebtedness as of such date (but
giving pro forma effect to the borrowing of the Term Loan, if applicable) to
Adjusted EBITDA for the four (4) fiscal quarters then ended to exceed 3.50 to
1.00.

Section 7.02 Interest Coverage Ratio. As of the last day of each fiscal quarter,
the Borrower shall not permit the ratio of:

(a) EBITDA for the four (4) fiscal quarters then ended minus Capital
Expenditures made by the Borrower and its Subsidiaries during such four
(4) fiscal quarters; to

(b) the sum of Interest Expense for the Borrower and its Subsidiaries during
such four (4) fiscal quarters minus total interest income received by the
Borrower and its Subsidiaries during such four (4) fiscal quarters,

to be less than 3.00 to 1.00.

 

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ARTICLE VIII.

Events of Default

Section 8.01 Events of Default; Remedies. If any of the following events
(“Events of Default”) shall occur:

(a) Principal Payments. the Borrower shall fail to pay 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 otherwise;

(b) Interest, Fees, and other Payments. the Borrower shall fail to pay (i) any
interest on any Loan or any fee payable under this Agreement or any other Loan
Document, when and as the same shall become due and payable, and such failure
shall continue unremedied for a period of five (5) Business Days or (ii) any
amount under this Agreement or any other Loan Document (other than principal,
interest or fees), when and as the same shall become due and payable, and such
failure shall continue unremedied for a period of ten (10) days;

(c) Representations or Warranties. any representation, warranty or certification
made or deemed made by or on behalf of the Borrower or any Subsidiary in or in
connection with any Loan Document or any amendment or modification thereof or
waiver thereunder, or in any report, certificate, financial statement or other
document furnished pursuant to or in connection with any Loan Document or any
amendment or modification thereof or waiver thereunder, shall prove to have been
incorrect in any material respect (except for any representation or warranty
that is qualified by materiality, Material Adverse Effect or similar phrase
which shall prove to be incorrect in any respect), when made or deemed made;

(d) Covenant Violation; Immediate Default. the Borrower shall fail to observe or
perform any covenant, condition or agreement contained in Sections 5.02, 5.03(a)
(with respect to the existence of the Borrower or any Material Subsidiary),
5.10, 5.11 or 5.13 or in Article VI or in Article VII;

(e) Covenant Violation with Cure Period. any Loan Party shall fail to observe or
perform any covenant, condition or agreement contained in any Loan Document
(other than those specified in clause (a), (b) or (d) of this Section 8.01), and
such failure shall continue unremedied for a period of 30 days after the earlier
of (i) the date on which the Chief Executive Officer, the General counsel, or a
Financial Officer of such Loan Party becomes aware of such failure or
(ii) notice thereof from the Administrative Agent to the Borrower (which notice
will be given at the request of any Lender);

(f) Cross Payment Default. the Borrower or any Subsidiary shall fail to make any
payment (whether of principal or interest and regardless of amount) in respect
of any Material Indebtedness, when and as the same shall become due and payable
(subject to any applicable grace period);

(g) Cross Covenant Default. any event or condition occurs that results in any
Material Indebtedness becoming due prior to its scheduled maturity or that
enables or permits (with or without the giving of notice, the lapse of time or
both) 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

 

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thereof, prior to its scheduled maturity; provided that this clause (g) 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;

(h) Involuntary Bankruptcy. an involuntary proceeding shall be commenced or an
involuntary petition shall be filed seeking (i) liquidation, reorganization or
other relief in respect of the Borrower or any Subsidiary or its debts, or of a
substantial part of its assets, under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect or (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Borrower or any Subsidiary or for a substantial part of
its assets, and, in any such case, 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) Voluntary Bankruptcy. the Borrower or any Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation, reorganization
or other relief under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or petition described in clause (h) of this Section 8.01, (iii) apply
for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any Subsidiary
or for a substantial part of its assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors or (vi) take any
action for the purpose of effecting any of the foregoing;

(j) Other Insolvency. the Borrower or any Subsidiary shall become unable, admit
in writing its inability or fail generally to pay its debts as they become due;

(k) Judgments. one or more final judgments for the payment of money in an
aggregate amount in excess of $75,000,000 (to the extent not covered by
independent third-party insurance) shall be rendered against the Borrower, any
Subsidiary or any combination thereof and the same shall remain undischarged for
a period of 30 consecutive days during which execution shall not be effectively
stayed, or any action shall be legally taken by a judgment creditor to attach or
levy upon any assets of the Borrower or any Subsidiary to enforce any such
judgment;

(l) ERISA Event. ERISA Event shall have occurred that when taken together with
all other ERISA Events that have occurred, could reasonably be expected to
result in a Material Adverse Effect;

(m) Invalidity of Loan Documents. the Guaranty Agreement shall otherwise for any
reason cease to be in full force and effect and valid, binding and enforceable
in accordance with its terms after its date of execution, or the Borrower or any
Subsidiary Guarantor shall so state in writing;

(n) Change in Control. a Change in Control shall occur; or

(o) Amendment, Termination, Cancellation or Refinance of Existing Credit
Facility. the Bank Facility shall be in whole or in part cancelled, terminated,
amended, extended or refinanced (including, without limitation, by any amendment
and restatement of the Bank Facility); provided, however, that for the avoidance
of doubt, there shall be no default under this clause (o) if the Loan
Obligations are being Fully Satisfied substantially concurrently with any
refinancing of the Bank Facility;

 

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then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Section), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times: declare the Loans
then outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be
due and payable), and thereupon the principal of the Loans so declared to be due
and payable, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest, notice of intent to
accelerate, notice of acceleration or other notice of any kind, all of which are
hereby waived by the Borrower; and in case of any event with respect to the
Borrower described in clause (h) or (i) of this Section, the principal of the
Loans then outstanding, together with accrued interest thereon and all fees and
other obligations of the Borrower accrued hereunder, shall automatically become
due and payable, without presentment, demand, protest, notice of intent to
accelerate, notice of acceleration or other notice of any kind, all of which are
hereby waived by the Borrower. In addition, if any Event of Default exists, the
Administrative Agent may (and if directed by the Required Lenders, shall)
foreclose or otherwise enforce any Lien granted to the Administrative Agent, for
the benefit of the Secured Parties, to secure payment and performance of the
Obligations in accordance with the terms of the Loan Documents and exercise any
and all rights and remedies afforded by the laws of the State of New York or any
other jurisdiction, by any of the Loan Documents, by equity, or otherwise.

Section 8.02 Performance by the Administrative Agent. If any Loan Party shall
fail to perform any covenant or agreement in accordance with the terms of the
Loan Documents, the Administrative Agent may, and shall at the direction of the
Required Lenders, perform or attempt to perform such covenant or agreement on
behalf of the applicable Loan Party. In such event, the Borrower shall, at the
request of the Administrative Agent promptly pay any amount expended by the
Administrative Agent or the Lenders in connection with such performance or
attempted performance to the Administrative Agent, together with interest
thereon at the interest rate provided for in Section 2.09(c) from and including
the date of such expenditure to but excluding the date such expenditure is paid
in full. Notwithstanding the foregoing, it is expressly agreed that neither the
Administrative Agent nor any Lender shall have any liability or responsibility
for the performance of any obligation of any Loan Party under any Loan Document.

Section 8.03 Limitation on Separate Suit. No suit shall be brought against any
Loan Party on account of the Loan Obligations except by the Administrative
Agent, acting upon the written instructions of the Required Lenders.

ARTICLE IX.

The Administrative Agent

Section 9.01 Appointment. Each of the Lenders hereby irrevocably appoints
JPMorgan Chase Bank, National Association as agent on its behalf, and on behalf
of each of its Affiliates who are owed Obligations (each such Affiliate by
acceptance of the benefits of the Loan Documents hereby ratifying such
appointment) and authorizes the Administrative Agent to take such actions on its
behalf and on behalf of such Affiliates and to exercise such powers as are
delegated to the Administrative Agent by the terms of the Loan Documents,
together with such actions and powers as are reasonably incidental thereto.

 

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Section 9.02 Rights as a Lender. The Person serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not the
Administrative Agent, and such Person and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of business with the
Borrower or any Subsidiary or other Affiliate thereof as if it were not the
Administrative Agent hereunder.

Section 9.03 Limitation of Duties and Immunities. The Administrative Agent shall
not have any duties or obligations except those expressly set forth in the Loan
Documents. Without limiting the generality of the foregoing, (a) the
Administrative Agent shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default exists, (b) the Administrative Agent
shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated by the Loan Documents that the Administrative Agent is required to
exercise in writing by the Required Lenders (or such other number or percentage
of the Lenders as shall be necessary under the circumstances as provided in
Section 10.02), and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to any Loan Party
that is communicated to or obtained by the Person serving as Administrative
Agent or any of its Affiliates in any capacity. The Administrative Agent shall
not be liable for any action taken or not taken by it with the consent or at the
request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in
Section 10.02) or in the absence of its own gross negligence or willful
misconduct. The Administrative Agent shall not be deemed to have knowledge of
any Default unless and until written notice thereof is given to the
Administrative Agent by the Borrower or a Lender, and the Administrative Agent
shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with any
Loan Document, (ii) the contents of any certificate, report or other document
delivered thereunder or in connection therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth in any Loan Document, (iv) the validity, enforceability, effectiveness or
genuineness of any Loan Document or any other agreement, instrument or document,
or (v) the satisfaction of any condition set forth in Article IV or elsewhere in
any Loan Document, other than to confirm receipt of items expressly required to
be delivered to the Administrative Agent.

Section 9.04 Reliance on Third Parties. 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 believed by it to be genuine and to have been signed or sent by the
proper Person. The Administrative Agent also may rely upon any statement made to
it orally or by telephone and believed by it to be made by the proper Person,
and shall not incur any liability for relying thereon. The Administrative Agent
may consult with legal counsel (who may be counsel for any Loan Party),
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.

 

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Section 9.05 Sub-Agents. The Administrative Agent may perform any and all its
duties and exercise its rights and powers by or through any one or more
sub-agents appointed by the Administrative Agent. The Administrative Agent and
any such sub-agent may perform any and all its duties and exercise its rights
and powers through their respective Related Parties. The exculpatory provisions
of this Article shall apply to any such sub-agent and to the Related Parties of
each Administrative Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.

Section 9.06 Successor Agent. Subject to the appointment and acceptance of a
successor the Administrative Agent as provided in this paragraph, the
Administrative Agent may resign at any time by notifying the Lenders and the
Borrower. Upon any such resignation, the Required Lenders shall have the right,
in consultation with the Borrower, to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of its resignation, then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent which shall be a bank with an
office in New York, New York, or an Affiliate of any such bank. Upon the
acceptance of its appointment as Administrative Agent hereunder by a successor,
such successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. The fees payable by the Borrower to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the Administrative Agent’s
resignation hereunder, the provisions of this Article and Section 10.03 shall
continue in effect for the benefit of such retiring Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while it was acting as Administrative
Agent.

Section 9.07 Independent Credit Decisions. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement as a
Lender, and to make, acquire or hold Loans hereunder. Each Lender shall,
independently and without reliance upon the Administrative Agent or any other
Lender and based on such documents and information (which may contain material,
non-public information within the meaning of the United States securities laws
concerning the Borrower and its Affiliates) as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or related agreement
or any document furnished hereunder or thereunder.

Section 9.08 Authorized Release of Subsidiary Guarantor. If:

(a) no Default exists or would result; and

(b) the Administrative Agent shall have received a certificate of a Responsible
Officer of the Borrower requesting the release of a Subsidiary Guarantor,
certifying

 

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that (A) no Default exists or will result from the release of the Subsidiary
Guarantor; and (B) the Administrative Agent is authorized to release such
Subsidiary Guarantor because the Equity Interest issued by such Subsidiary
Guarantor or the assets of such Subsidiary Guarantor have been sold in a
transaction permitted by Section 6.05 (including with the consent of the
Required Lenders pursuant to Section 10.02(b));

then the Administrative Agent is irrevocably authorized by the Secured Parties,
without any consent or further agreement of any Secured Party to release such
Subsidiary Guarantor from all obligations under the Loan Documents. To the
extent the Administrative Agent is required to execute any release documents in
accordance with the immediately preceding sentence, the Administrative Agent
shall do so promptly upon request of the Borrower without the consent or further
agreement of any Secured Party.

Section 9.09 Lender Affiliates Rights. By accepting the benefits of the Loan
Documents, any Affiliate of a Lender that is owed any Obligation is bound by the
terms of the Loan Documents. But notwithstanding the foregoing: (a) neither the
Administrative Agent, any Lender nor any Loan Party shall be obligated to
deliver any notice or communication required to be delivered to any Lender under
any Loan Documents to any Affiliate of any Lender; and (b) no Affiliate of any
Lender that is owed any Obligation shall be included in the determination of the
Required Lenders or entitled to consent to, reject, or participate in any manner
in any amendment, waiver or other modification of any Loan Document. The
Administrative Agent shall not have any liabilities, obligations or
responsibilities of any kind whatsoever to any Affiliate of any Lender who is
owed any Obligation. The Administrative Agent shall deal solely and directly
with the related Lender of any such Affiliate in connection with all matters
relating to the Loan Documents. The Obligation owed to such Affiliate shall be
considered the Obligation of its related Lender for all purposes under the Loan
Documents and such Lender shall be solely responsible to the other parties
hereto for all the obligations of such Affiliate under any Loan Document.

ARTICLE X.

Miscellaneous

Section 10.01 Notices.

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

(i) if to the Borrower or to any Subsidiary Guarantor, to it at 2140 Lake Park
Boulevard, Richardson, Texas, 75080, Attention of Rick Pelini, Vice President,
Treasurer (Telecopy No. 972.497.6940);

(ii) if to the Administrative Agent, to JPMorgan Chase Bank, National
Association, 2200 Ross Avenue, Third Floor, Dallas, Texas 75201, Attention:
Gregory T. Martin, Vice President, Telephone: 214.965.2171; Telecopy:
214.965.2044 and JPMorgan Chase Bank, National Association, Midcorp Loan and
Agency Services Group, Mailcode: IL1-001010; 10 South Dearborn Street, 7th
Floor, Chicago, IL 60603; Attention: Nan Wilson, Telephone: 312-385-7084;
Telecopy: 888-292-9533; and

(iii) if to any other Lender, to it at its address (or telecopy number) set
forth in its Administrative Questionnaire.

 

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

(b) Notices and other communications to the Lenders hereunder may be delivered
or furnished by using Electronic Systems pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices
pursuant to Article II unless otherwise agreed by the Administrative Agent and
the applicable Lender. The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.

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

(c) Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto.

(d) Electronic Systems.

(i) The Borrower agrees that the Administrative Agent may, but shall not be
obligated to, make Communications (as defined below) available to the other
Lenders by posting the Communications on Debt Domain, Intralinks, Syndtrak,
ClearPar or a substantially similar Electronic System.

(ii) Any Electronic System used by the Administrative Agent is provided “as is”
and “as available.” The Agent Parties (as defined below) do not warrant the
adequacy of such Electronic Systems and expressly disclaim liability for errors
or omissions in the Communications. No warranty of any kind, express, implied or
statutory, including any warranty of merchantability, fitness for a particular
purpose, non-infringement of third-party rights or freedom from viruses or other
code defects, is made by any Agent Party in connection with the Communications
or any Electronic System. In no event shall the Administrative Agent or any of
its Related Parties (collectively, the “Agent Parties”) have any liability to
the Borrower

 

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any Lender or any other Person or entity for damages of any kind, including
direct or indirect, special, incidental or consequential damages, losses or
expenses (whether in tort, contract or otherwise) arising out of the Borrower’s
or the Administrative Agent’s transmission of communications through an
Electronic System. “Communications” means, collectively, any notice, demand,
communication, information, document or other material provided by or on behalf
of the Borrower pursuant to any Loan Document or the transactions contemplated
therein which is distributed by the Administrative Agent or any Lender by means
of electronic communications pursuant to this Section, including through an
Electronic System.

Section 10.02 Waivers; Amendments.

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

(b) Amendments. Neither this Agreement nor any other Loan Document nor any
provision hereof or thereof may be waived, amended or modified except pursuant
to an agreement or agreements in writing entered into by the Borrower, the
Administrative Agent; provided that no such agreement shall:

(i) reduce or forgive the principal amount of any Loan or reduce the rate of
interest thereon, or reduce or forgive any interest or fees payable hereunder,
without the written consent of each Lender (including any such Lender that is a
Defaulting Lender) directly affected thereby,

(ii) postpone any scheduled date of payment of the principal amount of any Loan,
or any date for the payment of any interest, fees or other Obligations payable
hereunder, or waive or excuse any such payment, or postpone the Maturity Date,
without the written consent of each Lender (including any such Lender that is a
Defaulting Lender) directly affected thereby,

(iii) change Section 2.14(b), (c) or (f) in a manner that would alter the manner
in which payments are shared, without the written consent of each Lender
(including any such Lender that is a Defaulting Lender),

(iv) change any of the provisions of this Section or the definition of “Required
Lenders”, “Loan Party” or “Obligation” (or any term defined therein) or any
other provision of any Loan Document specifying the number or percentage of
Lenders required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender (including any such Lender that is a Defaulting Lender) directly
affected thereby,

 

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(v) change Section 2.16, without the consent of each Lender (other than any
Defaulting Lender),

(vi) release any Loan Party from its obligation under the Guaranty Agreement
(except as otherwise permitted herein or in the other Loan Documents), without
the written consent of each Lender (other than any Defaulting Lender), or

(vii) increase the Term Loan Commitment of any Lender, without the written
consent of each Lender (including any such Lender that is a Defaulting Lender)
directly affected thereby;

(A) provided further that (1) no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent hereunder without the
prior written consent of the Administrative Agent and (2) the consent of the
Required Lenders shall not be required for any change to any fee letter.

(c) Administrative Corrections. Notwithstanding anything to the contrary herein,
the Administrative Agent and applicable Loan Parties may amend, modify or
supplement this Agreement or any other Loan Document to cure or correct
administrative errors or omissions, any ambiguity, omission, defect or
inconsistency or to effect administrative changes, so long as such amendment,
modification or supplement does not adversely affect the rights of any Lender
and such amendment shall become effective without any further consent of any
other party to such Loan Document; provided that the Administrative Agent shall
give each Lender notice of any such amendment, modification or supplement.

Section 10.03 Expenses; Indemnity; Damage Waiver.

(a) Expenses. The Borrower shall pay (i) all reasonable and documented
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent, in connection with the syndication of the credit
facilities provided for herein, the preparation and administration of the Loan
Documents or any amendments, modifications or waivers of the provisions thereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated), and (ii) all reasonable and documented out-of-pocket expenses
incurred by the Administrative Agent or any Lender, including the fees, charges
and disbursements of any counsel for the Administrative Agent, and the fees,
charges and disbursements of one primary counsel for the Lenders, in connection
with the enforcement or protection of its rights in connection with the Loan
Documents, including its rights under this Section, or in connection with the
Loans made, including all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans.

(b) Indemnity. THE BORROWER SHALL INDEMNIFY THE ADMINISTRATIVE AGENT AND EACH
LENDER, AND EACH RELATED PARTY OF ANY OF THE FOREGOING PERSONS (EACH SUCH PERSON
BEING CALLED AN “INDEMNITEE”) AGAINST, AND HOLD EACH INDEMNITEE HARMLESS FROM,
ANY AND ALL LOSSES, CLAIMS, DAMAGES, LIABILITIES AND RELATED EXPENSES,

 

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INCLUDING THE REASONABLE AND DOCUMENTED FEES, CHARGES AND DISBURSEMENTS OF ANY
COUNSEL FOR ANY INDEMNITEE, INCURRED BY OR ASSERTED AGAINST ANY INDEMNITEE
ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF (I) THE EXECUTION OR
DELIVERY OF THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR ANY OTHER AGREEMENT OR
INSTRUMENT CONTEMPLATED HEREBY, THE PERFORMANCE BY THE PARTIES TO THE LOAN
DOCUMENTS OF THEIR RESPECTIVE OBLIGATIONS THEREUNDER OR THE CONSUMMATION OF THE
TRANSACTIONS OR ANY OTHER TRANSACTIONS CONTEMPLATED HEREBY, (II) ANY LOAN OR THE
USE OF THE PROCEEDS THEREFROM, (III) ANY ACTUAL OR ALLEGED PRESENCE OR RELEASE
OF HAZARDOUS MATERIALS ON OR FROM ANY PROPERTY CURRENTLY OR FORMERLY OWNED OR
OPERATED BY THE BORROWER OR ANY OF THE SUBSIDIARIES, OR ANY ENVIRONMENTAL
LIABILITY RELATED IN ANY WAY TO THE BORROWER OR ANY OF ITS SUBSIDIARIES, OR
(IV) ANY ACTUAL OR PROSPECTIVE CLAIM, LITIGATION, INVESTIGATION OR PROCEEDING
RELATING TO ANY OF THE FOREGOING, WHETHER OR NOT SUCH CLAIM, LITIGATION,
INVESTIGATION OR PROCEEDING IS BROUGHT BY THE BORROWER OR ITS EQUITY HOLDERS,
AFFILIATES, CREDITORS OR ANY OTHER THIRD PERSON AND WHETHER BASED ON CONTRACT,
TORT OR ANY OTHER THEORY, WHETHER AND REGARDLESS OF WHETHER ANY INDEMNITEE IS A
PARTY THERETO; PROVIDED THAT SUCH INDEMNITY SHALL NOT, AS TO ANY INDEMNITEE, BE
AVAILABLE TO THE EXTENT THAT SUCH LOSSES, CLAIMS, DAMAGES, LIABILITIES OR
RELATED EXPENSES ARE DETERMINED BY A COURT OF COMPETENT JURISDICTION BY FINAL
AND NONAPPEALABLE JUDGMENT TO HAVE RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF SUCH INDEMNITEE. THIS SECTION 10.03(B) SHALL NOT APPLY WITH
RESPECT TO TAXES OTHER THAN ANY TAXES THAT REPRESENT LOSSES, CLAIMS OR DAMAGES
ARISING FROM ANY NON-TAX CLAIM. WITHOUT LIMITING ANY PROVISION OF ANY LOAN
DOCUMENT, IT IS THE EXPRESS INTENTION OF THE PARTIES HERETO THAT EACH INDEMNITEE
SHALL BE INDEMNIFIED FROM AND HELD HARMLESS AGAINST ANY AND ALL LOSSES,
LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND
EXPENSES (INCLUDING ATTORNEYS’ FEES AND EXPENSES) ARISING OUT OF OR RESULTING
FROM THE SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH INDEMNITEE. THE BORROWER AND
EACH OF ITS SUBSIDIARIES WAIVE ANY AND ALL CLAIMS, OFFSETS, DEFENSES OR
COUNTERCLAIMS, WHETHER KNOWN OR UNKNOWN, ARISING PRIOR TO THE EFFECTIVE DATE AND
RELATING TO ANY LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY.

(c) Lender’s Agreement to Pay. To the extent that the Borrower fails to pay any
amount required to be paid by it to the Administrative Agent under paragraph (a)
or (b) of this Section, each Lender severally agrees to pay to the
Administrative Agent, such Lender’s pro rata share (determined as of the time
that the applicable unreimbursed expense or indemnity payment is sought) of such
unpaid amount; provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by
or asserted against the Administrative Agent in its capacity as such. For
purposes hereof, a Lender’s “pro rata share” shall be determined based upon its
share of the sum of the Term Loan made by it hereunder.

(d) Waiver of Damages. To the extent permitted by applicable law, no Loan Party
shall assert, and each Loan Party waives, any claim against any Indemnitee, on
any theory

 

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of liability, for special, indirect, incidental, consequential or punitive
damages (as opposed to direct or actual damages) arising out of, in connection
with, or as a result of, the Loan Documents or any agreement or instrument
contemplated hereby, the Transactions, any Loan or the use of the proceeds
thereof; provided that, nothing in this clause (d) shall relieve the Borrower or
any obligation it may have to indemnify an Indemnitee against special, indirect,
consequential or punitive damages asserted against such Indemnitee by a third
party. No Indemnitee referred to in clause (b) of this Section 10.03 shall be
liable for any damages arising from the use by others of any materials obtained
through electronic, telecommunications or other information transmission systems
in connection with this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby, except to the extent such damages
are found by a final, non-appealable judgment of a court of competent
jurisdiction to arise or result from the willful misconduct or gross negligence
of such indemnified person or as a result of the breach in bad faith by any
indemnified person of this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby.

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

Section 10.04 Successors and Assigns.

(a) Successors and Assigns. The provisions of this Agreement are binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns permitted hereby (including any Affiliate of a Lender who is owed
any of the Obligations and any Indemnitee), except that (i) the Borrower may not
assign or otherwise transfer any of its rights or obligations hereunder without
the prior written consent of each Lender (and any attempted assignment or
transfer by the Borrower without such consent shall be null and void) and
(ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
(including any Affiliate of a Lender who is owed any of the Obligations and any
Indemnitee), Participants (to the extent provided in paragraph (c) of this
Section) and, to the extent expressly contemplated hereby, the Related Parties
of each of the Administrative Agent and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

(b) Assignment. (i) Subject to the conditions set forth in paragraph (b)(ii)
below, any Lender may assign to one or more assignees all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Loans at the time owing to it) with the prior written consent (such consent not
to be unreasonably withheld or delayed) of:

(A) the Borrower, provided that, no consent of the Borrower shall be required
for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if
an Event of Default has occurred and is continuing, any other assignee; and

(B) the Administrative Agent.

 

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(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 Loans, the amount of Loans of the assigning Lender subject to
each such assignment (determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent) shall
not be less than $5,000,000 unless each of the Borrower and the Administrative
Agent otherwise consent, provided that no such consent of the Borrower shall be
required if an Event of Default exists;

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;

(C) the parties to each assignment shall execute and deliver to the
Administrative Agent (x) an Assignment and Assumption or (y) to the extent
applicable, an agreement incorporating an Assignment and Assumption by reference
pursuant to a Platform as to which the Administrative Agent and the parties to
the Assignment and Assumption are participants, together with a processing and
recordation fee of $3,500 and the tax forms required by Section 2.13(f); and

For the purposes of this Section 10.04(b), the term “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 of its business 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 assignment under this Section 10.04 shall be
made to (x) the Borrower or any of the Borrower’s Affiliates or Subsidiaries,
(y) any Defaulting Lender or any of its subsidiaries, or any Person who, upon
becoming a Lender hereunder, would constitute any of the foregoing Persons
described in this clause (y), or (z) a natural person.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment
and Assumption the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of
Sections 2.11, 2.12, 2.13 and 10.03, subject to the requirements and limitations
therein). Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this Section 10.04 shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with paragraph (c) of this Section.

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

 

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(v) Upon its receipt of (x) a duly completed Assignment and Assumption executed
by an assigning Lender and an assignee or (y) to the extent applicable, an
agreement incorporating an Assignment and Assumption by reference pursuant to a
Platform as to which the Administrative Agent and the parties to the Assignment
and Assumption are participants, the assignee’s completed Administrative
Questionnaire (unless the assignee shall already be a Lender hereunder), the
processing and recordation fee and tax forms referred to in paragraph (b) of
this Section and any written consent to such assignment required by
paragraph (b) of this Section, the Administrative Agent shall accept such
Assignment and Assumption and record the information contained therein in the
Register; provided that if either the assigning Lender or the assignee shall
have failed to make any payment required to be made by it pursuant to this
Agreement or any other Loan Document, the Administrative Agent shall have no
obligation to accept such Assignment and Assumption and record the information
therein in the Register unless and until such payment shall have been made in
full, together with all accrued interest thereon. No assignment shall be
effective for purposes of this Agreement unless it has been recorded in the
Register as provided in this paragraph.

(c) Participations. Any Lender may, without the consent of the Borrower 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 Loans owing to it);
provided that (A) such Lender’s obligations under this Agreement shall remain
unchanged; (B) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations; and (C) the Borrower, the
Administrative Agent 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 or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 10.02(b) that affects such
Participant. The Borrower agrees that each Participant shall be entitled to the
benefits of Sections 2.11, 2.12 and 2.13 (subject to the requirements and
limitations therein, including the requirements under Sections 2.13(f) and
(g) (it being understood that the documentation required under Section 2.13(f)
shall be delivered to the participating Lender and the information and
documentation required under 2.13(g) will be delivered to the Borrower and the
Administrative Agent)) to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section;
provided that such Participant (A) agrees to be subject to the provisions of
Section 2.15 as if it were an assignee under paragraph (b) of this Section; and
(B) shall not be entitled to receive any greater payment under Section 2.11 or
2.13, with respect to any participation, than its participating Lender would
have been entitled to receive, unless the participation occurred with the
Borrower’s prior written consent. Each Lender that sells a participation agrees,
at the Borrower’s request and expense, to use reasonable efforts to cooperate
with the Borrower to effectuate the provisions of Section 2.15(b) with respect
to any Participant. To the extent permitted by law, each Participant also shall
be entitled to the benefits of Section 10.08 as though it were a Lender;
provided that such Participant agrees to be subject to Section 2.14(c) as though
it were a Lender. Each Lender that sells a participation shall, acting solely
for this purpose as a non-fiduciary agent of the Borrower, maintain a register
on which it enters the name and address of each Participant and the principal
amounts of (and stated interest on) each Participant’s interest in the Loans or
other obligations under the Loan Documents (the

 

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“Participant Register”); provided that no Lender shall have any obligation to
disclose all or any portion of the Participant Register (including the identity
of any Participant or any information relating to a Participant’s interest in
any Loans or its other obligations under any Loan Document) to any Person except
to the extent that such disclosure is necessary to establish that such Loan or
other obligation is in registered form under Section 5f.103-1(c) of the United
States Treasury Regulations. The entries in the Participant Register shall be
conclusive absent manifest error, and such Lender shall treat each Person whose
name is recorded in the Participant Register as the owner of such participation
for all purposes of this Agreement notwithstanding any notice to the contrary.
For the avoidance of doubt, the Administrative Agent (in its capacity as
Administrative Agent) shall have no responsibility for maintaining a Participant
Register.

(d) Pledge. 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 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.

Section 10.05 Survival. All covenants, agreements, representations and
warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement or any other Loan Document shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of the Loan Documents and the making of any Loans, regardless of any
investigation made by any such other party or on its behalf and notwithstanding
that the Administrative Agent, or any Lender may have had notice or knowledge of
any Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect until the
Obligations have been Fully Satisfied. The provisions of Sections 2.11, 2.12,
2.13 and 10.03 and Article IX shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans, or the termination of this Agreement or any provision
hereof.

Section 10.06 Counterparts; Integration; Effectiveness; Amendment and
Restatement; Electronic Execution. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract. This Agreement, the other Loan Documents and
any separate letter agreement with respect to fees payable to the Administrative
Agent embody the final, entire agreement among the parties relating to the
subject matter hereof and supersede any and all previous commitments,
agreements, representations and understandings, whether oral or written,
relating to the subject matter hereof and may not be contradicted or varied by
evidence of prior, contemporaneous or subsequent oral agreements or discussions
of the parties hereto. There are no unwritten oral agreements among the parties
hereto. Delivery of an executed counterpart of a signature page of this
Agreement by telecopy, emailed pdf. or any other electronic means that
reproduces an image of the actual executed signature page shall be effective as
delivery of a manually executed counterpart of this Agreement. The words
“execution,” “signed,” “signature,” “delivery,” and words of like import in or
relating to any document to be signed in connection with this Agreement and the
transactions contemplated hereby shall be deemed to include Electronic
Signatures, deliveries or the keeping of records in electronic form, each of
which shall be of the same legal effect, validity or enforceability as a
manually executed signature, physical

 

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delivery thereof or the use of a paper-based recordkeeping system, as the case
may be, to the extent and as provided for in any applicable law, including the
Federal Electronic Signatures in Global and National Commerce Act, the New York
State Electronic Signatures and Records Act, or any other similar state laws
based on the Uniform Electronic Transactions Act.

Section 10.07 Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.

Section 10.08 Right of Setoff. If an Event of Default exists, each Lender and
each of its Affiliates is hereby authorized at any time and from time to time,
to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other obligations at any time owing by such Lender or Affiliate to or
for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement or
the other Loan Documents held by such Lender, irrespective of whether or not
such Lender shall have made any demand under this Agreement and although such
obligations may be unmatured. The rights of each Lender under this Section are
in addition to other rights and remedies (including other rights of setoff)
which such Lender may have. Each Lender agrees to notify the Borrower and the
Administrative Agent promptly after any such setoff and application but the
failure of any Lender to so notify the Borrower shall not impair such Lender’s
rights hereunder.

Section 10.09 Governing Law; Jurisdiction; Consent to Service of Process.

(a) Governing Law. This Agreement shall be governed by and construed in
accordance with the applicable law pertaining in the State of New York, other
than those conflict of law provisions that would defer to the substantive laws
of another jurisdiction. This governing law election has been made by the
parties in reliance (at least in part) on Section 5–1401 of the General
Obligations Law of the State of New York, as amended (as and to the extent
applicable), and other applicable law.

(b) Jurisdiction. THE BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS,
FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE SUPREME
COURT OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN AND OF THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK SITTING IN
THE BOROUGH OF MANHATTAN, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT, OR FOR
RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY
SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR,
TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES
HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER

 

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JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT
THE ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE
BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c) Venue. The Borrower 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 any other Loan Document in any
court referred to in paragraph (b) of this Section. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

(d) Service of Process. Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 10.01. Nothing
in this Agreement or any other Loan Document will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.

Section 10.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

Section 10.11 Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

Section 10.12 Confidentiality. Each of the Administrative Agent and the Lenders
agrees to maintain the confidentiality of the Information (as defined below),
except that Information may be disclosed (a) to its and its Affiliates’
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the extent requested
by any Governmental Authority (including any self-regulatory authority, such as
the National Association of Insurance Commissioners) purporting to have
jurisdiction over it, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
to this Agreement, (e) in connection with the exercise of any remedies hereunder
or

 

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any suit, action or proceeding relating to this Agreement or the enforcement of
rights hereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
the Borrower and its obligations, (g) with the consent of the Borrower or (h) to
the extent such Information (i) becomes publicly available other than as a
result of a breach of this Section or (ii) becomes available to the
Administrative Agent or any Lender on a non-confidential basis from a source
other than the Borrower. For the purposes of this Section, “Information” means
all information received from any Loan Party relating to any Loan Party, other
than any such information that is available to the Administrative Agent or any
Lender on a non-confidential basis prior to disclosure by the applicable Loan
Party; provided that, in the case of information received from a Loan Party
after the date hereof, such information is clearly identified at the time of
delivery as confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.

EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 10.12 FURNISHED
TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION
CONCERNING THE BORROWER AND ITS RELATED PARTIES OR THEIR RESPECTIVE SECURITIES,
AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF
MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC
INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING
FEDERAL AND STATE SECURITIES LAWS.

ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE
BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF
ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY
CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE BORROWER AND ITS AFFILIATES,
THE LOAN PARTIES AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES.
ACCORDINGLY, EACH LENDER REPRESENTS TO THE BORROWER AND THE ADMINISTRATIVE AGENT
THAT IT HAS IDENTIFIED IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO
MAY RECEIVE INFORMATION THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN
ACCORDANCE WITH ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW.

Section 10.13 Maximum Interest Rate.

(a) Limitation to Maximum Rate; Recapture. No interest rate specified in any
Loan Document shall at any time exceed the Maximum Rate. If at any time the
interest rate (the “Contract Rate”) for any obligation under the Loan Documents
shall exceed the Maximum Rate, thereby causing the interest accruing on such
obligation to be limited to the Maximum Rate, then any subsequent reduction in
the Contract Rate for such obligation shall not reduce the rate of interest on
such obligation below the Maximum Rate until the aggregate amount of interest
accrued on such obligation equals the aggregate amount of interest which would
have accrued on

 

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such obligation if the Contract Rate for such obligation had at all times been
in effect. As used herein, the term “Maximum Rate” means, at any time with
respect to any Lender, the maximum rate of nonusurious interest under applicable
law that such Lender may charge Borrower. The Maximum Rate shall be calculated
in a manner that takes into account any and all fees, payments, and other
charges contracted for, charged, or received in connection with the Loan
Documents that constitute interest under applicable law. Each change in any
interest rate provided for herein based upon the Maximum Rate resulting from a
change in the Maximum Rate shall take effect without notice to Borrower at the
time of such change in the Maximum Rate. For purposes of determining the Maximum
Rate under Texas law, the applicable rate ceiling shall be the indicted rate
ceiling described in, and computed in accordance with Section 303.003 of the
Texas Finance Code.

(b) Cure Provisions. No provision of any Loan Document shall require the payment
or the collection of interest in excess of the maximum amount permitted by
applicable law. If any excess of interest in such respect is hereby provided
for, or shall be adjudicated to be so provided, in any Loan Document or
otherwise in connection with this loan transaction, the provisions of this
Section shall govern and prevail and neither Borrower nor the sureties,
guarantors, successors, or assigns of Borrower shall be obligated to pay the
excess amount of such interest or any other excess sum paid for the use,
forbearance, or detention of sums loaned pursuant hereto. In the event any
Lender ever receives, collects, or applies as interest any such sum, such amount
which would be in excess of the maximum amount permitted by applicable law shall
be applied as a payment and reduction of the principal of the obligations
outstanding hereunder, and, if the principal of the obligations outstanding
hereunder has been paid in full, any remaining excess shall forthwith be paid to
the Borrower. In determining whether or not the interest paid or payable exceeds
the Maximum Rate, Borrower and each Lender shall, to the extent permitted by
applicable law, (a) characterize any non-principal payment as an expense, fee,
or premium rather than as interest, (b) exclude voluntary prepayments and the
effects thereof, and (c) amortize, prorate, allocate, and spread in equal or
unequal parts the total amount of interest throughout the entire contemplated
term of the obligations outstanding hereunder so that interest for the entire
term does not exceed the Maximum Rate.

Section 10.14 No Duty. All attorneys, accountants, appraisers, and other
professional Persons and consultants retained by the Administrative Agent or any
Lender shall have the right to act exclusively in the interest of the
Administrative Agent and the Lenders and shall have no duty of disclosure, duty
of loyalty, duty of care, or other duty or obligation of any type or nature
whatsoever to Borrower, any other Loan Party, any of their respective Equity
Interest holders or any other Person.

Section 10.15 No Fiduciary Relationship. The relationship between the Borrower
and the Loan Parties on the one hand and the Administrative Agent and each
Lender on the other is solely that of debtor and creditor, and neither the
Administrative Agent nor any Lender has any fiduciary or other special
relationship with the Borrower or any Loan Parties, and no term or condition of
any of the Loan Documents shall be construed so as to deem the relationship
between the Borrower and the other Loan Parties on the one hand and the
Administrative Agent and each Lender on the other to be other than that of
debtor and creditor.

Section 10.16 Equitable Relief. The Borrower recognizes that in the event the
Borrower or any other Loan Party fails to pay, perform, observe, or discharge
any or all of the obligations

 

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under the Loan Documents, any remedy at law may prove to be inadequate relief to
the Administrative Agent and the Lenders. The Borrower therefore agrees that the
Administrative Agent and the Lenders, if the Administrative Agent or the
Required Lenders so request, shall be entitled to temporary and permanent
injunctive relief in any such case without the necessity of proving actual
damages.

Section 10.17 Construction. The Borrower, each other Loan Party (by its
execution of the Loan Documents to which it is a party), the Administrative
Agent and each Lender acknowledges that each of them has had the benefit of
legal counsel of its own choice and has been afforded an opportunity to review
the Loan Documents with its legal counsel and that the Loan Documents shall be
construed as if jointly drafted by the parties thereto.

Section 10.18 Independence of Covenants. All covenants under the Loan Documents
shall be given independent effect so that if a particular action or condition is
not permitted by any of such covenants, the fact that it would be permitted by
an exception to, or be otherwise within the limitations of, another covenant
shall not avoid the occurrence of a Default if such action is taken or such
condition exists.

Section 10.19 USA PATRIOT Act. Each Lender that is subject to the requirements
of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”) notifies each Loan Party that pursuant to the requirements of
the Act, it is required to obtain, verify and record information that identifies
the Loan Party, which information includes the name and address of the Loan
Party and other information that will allow such Lender to identify the Loan
Party in accordance with the Act.

[Remainder of Page Intentionally Left Blank.]

 

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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
above written.

 

LENNOX INTERNATIONAL INC., as the Borrower By:  

/s/ Rick Pelini

  Rick Pelini, Vice President and Treasurer

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

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
individually as a Lender and as the Administrative Agent By:  

/s/ Gregory Martin

  Gregory T. Martin, Vice President

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

MORGAN STANLEY BANK, N.A.
as a Lender By:  

/s/ Michael King

  Name:   Michael King   Title:   Authorized Signatory

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

SCHEDULE 2.01

TO

LENNOX INTERNATIONAL, INC.

SHORT TERM FACILITY AGREEMENT

LENDER’S TERM LOAN COMMITMENTS ON THE EFFECTIVE DATE

 

LENDER

   AMOUNT OF TERM LOAN  

JPMorgan Chase Bank, N.A.

   $ 125,000,000   

Morgan Stanley Bank, N.A.

   $ 125,000,000      

 

 

 

TOTAL

   $ 250,000,000      

 

 

 

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

SCHEDULE 3.12

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

MATERIAL SUBSIDIARIES

 

Material Subsidiary

  

Jurisdiction

  

Ownership

Allied Air Enterprises LLC    Delaware    Lennox Industries Inc. (100%) Advanced
Distributor Products LLC    Delaware    Heatcraft Inc. (100%) Heatcraft Inc.   
Delaware    Borrower (100%) Heatcraft Refrigeration Products LLC    Delaware   
Heatcraft Inc. (100%) Lennox Global Ltd.    Delaware    Borrower (100%) Lennox
Industries Inc.    Delaware    Borrower (100%) LGL Australia (US) Inc.   
Delaware    Lennox Global Ltd. (100%) Lennox National Account Services LLC   
Florida        Lennox Industries Inc. (100%)

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

SCHEDULE 6.01

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

EXISTING INDEBTEDNESS

Indebtedness owing to BTMU Capital Leasing & Finance, Inc. arising in connection
with the Synthetic Lease in the initial amount of $41,202,994 (the “Synthetic
Lease”).

Indebtedness of up to 80 million Mexican Pesos owed by Kysor Warren de Mexico,
S. de R.L. de C.V. under a promissory note dated September 29, 2014

Indebtedness of up to 10 million Euros owed by LGL Holland B.V. to Bank of
America, National Association Amsterdam Branch under an uncommitted credit
facility initially dated April 17, 2012 and subsequently amended.

Amounts owed under a $450 million stock repurchase agreement to be entered into
in October, 2014.

Amounts owed in connection with Tift County Development Authority Industrial
Development Revenue Bonds (Heatcraft Refrigeration Products LLC Project), in the
initial amounts of US $12.7 million and US $3.6 million.

Amounts owed in connection with the General Obligation Industrial Development
Refunding Bonds of Grenada County, Mississippi, in the initial amount of US
$5,040,000.

Amounts owed in connection with loans of up to 37,310,990 Brazilian Reals made
to Heatcraft do Brasil.

Up to US $53,613,176 owed in connection with letters of credit issued by Chase,
Wells Fargo, US Bank and Scotia Bank.

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

SCHEDULE 6.02

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

EXISTING LIENS

The obligations of the Borrower under the Synthetic Lease and under related
documents which are purportedly secured by a pledge of, and a purported Lien on,
Lessee’s interest in the property leased pursuant to the Synthetic Lease.

Any call, buy-sell or similar rights granted to joint venture partners in
respect of equity of the applicable joint venture.

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

SCHEDULE 6.04

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

EXISTING INVESTMENTS

1. An approximate 25% common stock ownership interest in Alliance Compressor
LLC, a joint venture engaged in the manufacture and sale of compressors.

2. 50% common stock ownership in Frigus-Bohn S.A. de C.V. and Bohn de Mexico,
S.A. de C.V., a Mexican joint venture that produces and distributes unit coolers
and condensing units.

3. Approximately 6.5% common stock ownership interest in Kulthorn Kirby Public
Company Limited, a Thailand company engaged in the manufacture of compressors
for refrigeration applications.

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

SCHEDULE 6.10

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

EXISTING RESTRICTIONS

1. Amended and Restated Receivables Purchase Agreement initially dated as of
November 18, 2011, by and among Lennox Industries Inc., LPAC Corp., Victory
Receivables Corporation, as a Purchaser, The Bank of Tokyo-Mitsubishi UFJ, LTD,
New York Branch, as Administrative Agent, a Liquidity Bank and the BTMU
Purchaser Agent, and PNC Bank, National Association, as a Liquidity Bank, and
the PNC Purchaser Agent, as amended from time to time.

2. Senior Unsecured Notes

3. The Synthetic Lease (as defined in Schedule 6.01) and the documents executed
in connection therewith

4. Any restrictions in documents described in Schedules 6.01, 6.02 and 6.04

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

EXHIBIT A

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

FORM OF ASSIGNMENT AND ASSUMPTION

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

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the
“Assignee”). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
“Credit Agreement”), receipt of a copy of which is hereby acknowledged by the
Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto
are hereby agreed to and incorporated herein by reference and made a part of
this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement and any other
documents or instruments delivered pursuant thereto to the extent related to the
amount and percentage interest identified below of all of such outstanding
rights and obligations of the Assignor under the facility identified below
(including any guarantees included in such facilities) and (ii) to the extent
permitted to be assigned under applicable law, all claims, suits, causes of
action and any other right of the Assignor (in its capacity as a Lender) against
any Person, whether known or unknown, arising under or in connection with the
Credit Agreement, any other documents or instruments delivered pursuant thereto
or the loan transactions governed thereby or in any way based on or related to
any of the foregoing, including contract claims, tort claims, malpractice
claims, statutory claims and all other claims at law or in equity related to the
rights and obligations sold and assigned pursuant to clause (i) above (the
rights and obligations sold and assigned pursuant to clauses (i) and (ii) above
being referred to herein collectively as the “Assigned Interest”). Such sale and
assignment is without recourse to the Assignor and, except as expressly provided
in this Assignment and Assumption, without representation or warranty by the
Assignor.

 

1.    Assignor:   

 

   2.    Assignee:   

 

         [and is an Affiliate/Approved Fund of [identify Lender]1] 3.   
Borrower:    Lennox International Inc. 4.    Administrative Agent:    JPMorgan
Chase Bank, National Association, as the administrative agent under the Credit
Agreement 5.    Credit Agreement:    The $250,000,000 Short Term Facility
Agreement dated as of October 20, 2014 among Lennox International Inc., the
Lenders parties thereto, JPMorgan Chase Bank, National Association, as
Administrative Agent, and the other agents parties thereto

 

1  Select as applicable.

 

Page 1

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

6.    Assigned Interest:   

 

Term Loan

   Aggregate Amount of
Loans for all Lenders      Amount of Loans
Assigned      Percentage Assigned of
Loans2  

Term Loan

   $                    $                           % 

Term Loan

   $                    $                           % 

Term Loan

   $                    $                           % 

Effective Date:                  , 20     [TO BE INSERTED BY ADMINISTRATIVE
AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.]

The Assignee agrees to deliver to the Administrative Agent a completed
Administrative Questionnaire in which the Assignee designates one or more
contacts to whom all syndicate-level information (which may contain material
non-public information about the Borrower and their respective affiliates, the
other Loan Parties and their Related Parties or their respective securities)
will be made available and who may receive such information in accordance with
the Assignee’s compliance procedures and applicable laws, including Federal and
state securities laws.

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

ASSIGNOR [NAME OF ASSIGNOR] By:  

 

  Title:  

 

ASSIGNEE [NAME OF ASSIGNEE] By:  

 

  Title:  

 

 

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

 

Page 2

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

[Consented to and]3 Accepted: [NAME OF ADMINISTRATIVE AGENT], as Administrative
Agent By:  

 

  Title:  

 

[Consented to:]4 [NAME OF RELEVANT PARTY] By:  

 

  Title:  

 

 

3  To be added only if the consent of the Administrative Agent is required by
the terms of the Credit Agreement.

4  To be added only if the consent of the Borrower and/or other parties is
required by the terms of the Credit Agreement.

 

Page 3

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

ANNEX 1

SHORT TERM FACILITY AGREEMENT

PROVIDED TO LENNOX INTERNATIONAL INC.

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of the
Borrower, any of the Subsidiaries or Affiliates or any other Person obligated in
respect of any Loan Document or (iv) the performance or observance by the
Borrower, any of the Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Loan Document.

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the
requirements, if any, specified in the Credit Agreement that are required to be
satisfied by it in order to acquire the Assigned Interest and become a Lender,
(iii) from and after the Effective Date, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 5.01 thereof, as applicable,
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the
Administrative Agent or any other Lender, (v) attached to the Assignment and
Assumption is any documentation required to be delivered by it pursuant to the
terms of the Credit Agreement, duly completed and executed by the Assignee, and
(vi) it has, independently and without reliance upon the Administrative Agent or
any other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase the Assigned Interest; and (b) agrees
that (i) it will, independently and without reliance on the Administrative
Agent, the Assignor or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Loan Documents, and
(ii) it will perform in accordance with their terms all of the obligations which
by the terms of the Loan Documents are required to be performed by it as a
Lender.

2. Payments. From and after the Effective Date, the Administrative Agent shall
make all payments in respect of the Assigned Interest (including payments of
principal, interest, fees and other amounts) to the Assignor for amounts which
have accrued to but excluding the Effective Date and to the Assignee for amounts
which have accrued from and after the Effective Date.

 

Page 1

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

3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy or other electronic communications shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption. This Assignment
and Assumption shall be governed by and construed in accordance with the
applicable law pertaining in the State of New York, other than those conflict of
law provisions that would defer to the substantive laws of another jurisdiction.
This governing law election has been made by the parties in reliance (at least
in part) on Section 5–1401 of the General Obligations Law of the State of New
York, as amended (as and to the extent applicable), and other applicable law.

 

Page 2

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

EXHIBIT B

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

COMPLIANCE CERTIFICATE

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

COMPLIANCE CERTIFICATE

for the

quarter ending                  ,         

 

To: JPMorgan Chase Bank, National Association

Loan and Agency Services Group

10 South Dearborn Street, 7th Floor

Chicago, IL 60603

Attention: Nan Wilson

Telephone: 312-385-7084

Telecopy: 888-292-9533

and each Lender

Ladies and Gentlemen:

This Compliance Certificate (the “Certificate”) is being delivered pursuant to
Section 5.01(c) of that certain Short Term Facility Agreement (as amended, the
“Agreement”) dated as of October 20, 2014, among Lennox International Inc. (the
“Borrower”), JPMorgan Chase Bank, National Association, as administrative agent,
and the Lenders named therein. All capitalized terms, unless otherwise defined
herein, shall have the same meanings as in the Agreement. All the calculations
set forth below shall be made pursuant to the terms of the Agreement.

The undersigned, an authorized financial officer of the Borrower in his capacity
as such financial officer and not in his individual capacity, does hereby
certify to the Administrative Agent and the Banks that:

 

1.   DEFAULT               No Default has occurred or, if a Default has
occurred, I have described on the attached Exhibit A the nature thereof and the
steps taken or proposed to remedy such Default.         Compliance 2.   SECTION
5.01 - Financial Statements               (a)   Annual audited financial
statements of the Borrower on a consolidated basis within 90 days after the end
of each fiscal year end (together with Compliance Certificate).       Yes    No
   N/A   (b)   Quarterly unaudited financial statements of the Borrower on a
consolidated basis within 45 days after the end of the first three fiscal
quarters of each fiscal year (together with Compliance Certificate).       Yes
   No    N/A 3.   SECTION 7.01 - Leverage Ratio               (a)   Total
Indebtedness (determined giving pro forma effect to the borrowing of the Term
Loan, if applicable) as of fiscal quarter end    $                          (i)
  Principal amount of all obligations for borrowed money (including Loans)   
$                          (ii)   Conditional sale or title retentions       
$                           

 

Page 1

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

    (iii)   Deferred purchase price      $                            (iv)  
Obligations of others secured by a Lien      $                            (v)  
Capital Lease Obligations      $                            (vi)   Letters of
credit and banker’s acceptances      $                            (vii)   Total
     $                          (b)   Adjusted EBITDA (from Schedule 1)     
$                          (c)   Line 3(a) ÷ Line 3(b)               to 1.00   
          (d)   Maximum Leverage Ratio permitted by Credit Agreement      3.50
to 1.00         Yes    No 4.   SECTION 7.02 - Interest Coverage Ratio           
  (a)   EBITDA for last four fiscal quarters      $                          (b)
  Capital Expenditures for last four fiscal quarters      $                    
     (c)   Interest Expense for last four fiscal quarters      $               
          (d)   Total interest income received during last four fiscal quarters
     $                          (e)   Interest Coverage Ratio (lines (4(a) -
(b)) / (4(c) - (d)))               to 1.00              (f)   Minimum Interest
Coverage Ratio permitted by Credit Agreement      3.00 to 1.00         Yes    No
5.   Determination of Applicable Rate              (a)   Leverage Ratio
(determined based on the Leverage Ratio set forth on the pro forma compliance
certificate delivered as required by Section 4.01(f) until the Borrower has
delivered financial statements and a compliance certificate in accordance with
Sections 5.01(a) and (c) for the fiscal year ending December 31, 2014)     
         to 1.00              (b)   If adjustment required, set forth below new
margins and fees (see Schedule 2)                (i)   ABR Spread           %   
          (ii)   Eurodollar Spread           %              (iii)   Eurodollar
Daily Floating Rate Spread           %          6.   ATTACHED SCHEDULES        
     Attached hereto as schedules are the calculations supporting the
computation set forth above in this Certificate. All information contained
herein and on the attached schedules is true and correct. 7.   FINANCIAL
STATEMENTS                The financial statements attached hereto were prepared
in accordance with GAAP, except where expressly noted therein, and fairly
present in all material respects (subject to year end audit adjustments and
absence of footnotes) the financial conditions and the results of the operations
of the Persons reflected thereon, at the date and for the periods indicated
therein. 8.   CONFLICT                In the event of conflict between this
Certificate and the Credit Agreement, the Credit Agreement shall control.

 

Page 2

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

IN WITNESS WHEREOF, the undersigned has executed this Certificate effective as
of the date first written above.

 

LENNOX INTERNATIONAL INC. By:  

 

  Name:  

 

  Title:  

 

 

Page 3

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

SCHEDULE 1

TO

COMPLIANCE CERTIFICATE

 

(1)    Consolidated Net Income.      

Net income (loss) determined in accordance with GAAP

   $                    (2)    EBITDA.          (a) Consolidated Net Income
(from line 1)    $                       (b) the total of the following to the
extent deducted from Consolidated Net Income:         

(i) income and franchise taxes,

   $                      

(ii) Interest Expense,

   $                      

(iii) amortization and depreciation expense,

   $                      

(iv) non-cash charges resulting from the application of GAAP that requires a
charge against earnings for the impairment of assets (including goodwill);

   $                      

(v) any non-cash expenses that arose in connection with the grant of stock
options or other equity based awards to officers, directors, consultants, and
employees of the Borrower and its Subsidiaries;

   $                      

(vi) any non-recurring charges which relate to the discontinuance of Subsidiary
operations;

   $                      

(vii) any non-recurring charges which relate to restructuring and severance
activities; provided, that the total cash amount of such charges shall not
exceed $15,000,000 during any four fiscal quarter period (not taking into
account any cash charges under (viii) below)

   $                      

(viii) any non-recurring charges which relate to the refinance of the lease of
the Borrower’s headquarters building located at 2140 Lake Park Blvd.,
Richardson, Texas; provided, that the total cash amount of such charges shall
not exceed $15,000,000 during the term of this Agreement;

   $                      

(ix) any non-cash loss (or minus any gain) associated with the sale of assets
not in the ordinary course of business,

        

(x) extraordinary loss or other items (or minus any extraordinary gain or
income);

   $                      

(xii) any non-cash loss (or minus any non-cash gain) related to financial
instrument hedges (other than foreign currency hedges)

   $                      

(xiii) the cumulative non-cash effects of changes in accounting policies,

   $                      

Total (lines (i) through (xiii))

   $                       (c) cash payments made in such period related to a
non-cash expense (other than with respect to restructuring activities) added to
Consolidated Net Income in a previous period.    $                       (e)
EBITDA: Lines 2(a) plus 2(b) minus 2(c)       $                

(3)

   Adjusted EBITDA.          (a) EBITDA (from Line 2(e))    $                   
   (b) EBIDTDA from Prior Targets for periods prior to Acquisitions    $
                      (c) EBIDTDA for prior Companies and Prior Assets    $
                      (d) Total Adjusted EBITDA: Line 3(a) plus 3(b) minus 3(c)
      $                

 

Page 1

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

SCHEDULE 2

TO

COMPLIANCE CERTIFICATE

 

Leverage Ratio

   ABR Spread     Eurodollar
Spread  

Category 1

> 3.00 to 1.0

     1.00 %      2.00 % 

Category 2

£ 3.00 to 1.0 but > 2.50 to 1.0

     0.75 %      1.75 % 

Category 3

£ 2.50 to 1.0 but > 2.00 to 1.0

     0.50 %      1.50 % 

Category 4

£ 2.00 to 1.0 but > 1.50 to 1.0

     0.25 %      1.25 % 

Category 5

£ 1.50 to 1.0

     0.00 %      1.00 % 

 

Page 1

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

EXHIBIT C

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

SHORT TERM FACILITY AGREEMENT SUBSIDIARY GUARANTY AGREEMENT

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

SHORT TERM FACILITY AGREEMENT

SUBSIDIARY GUARANTY AGREEMENT

WHEREAS, LENNOX INTERNATIONAL INC. (the “Borrower”) has entered into that
certain Short Term Facility Agreement dated October 20, 2014 among Borrower, the
lenders party thereto (the “Lenders”), JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION, as the administrative agent for the Lenders (the “Administrative
Agent”) (such Credit Agreement, as it may hereafter be amended or otherwise
modified from time to time, being hereinafter referred to as the “Credit
Agreement”, and capitalized terms not otherwise defined herein shall have the
same meaning as set forth in the Credit Agreement);

WHEREAS, the execution of this Guaranty Agreement is a condition to the
Administrative Agent’s and each Lender’s obligations under the Credit Agreement;

NOW, THEREFORE, for valuable consideration, the receipt and adequacy of which
are hereby acknowledged, each of the undersigned Subsidiaries and any Subsidiary
hereafter added as a “Guarantor” hereto pursuant to a Subsidiary Joinder
Agreement (the “Subsidiary Joinder Agreement”) in the form attached hereto as
Exhibit A (individually a “Guarantor” and collectively the “Guarantors”), hereby
irrevocably and unconditionally guarantees to the Secured Parties the full and
prompt payment and performance of the Guaranteed Indebtedness (hereinafter
defined), this Guaranty Agreement being upon the following terms:

1. Guaranteed Indebtedness. The term “Guaranteed Indebtedness”, as used herein,
means all of the Obligations, as defined in the Credit Agreement. The
“Guaranteed Indebtedness” shall include any and all post-petition interest and
expenses (including attorneys’ fees) whether or not allowed under any
bankruptcy, insolvency, or other similar law; provided that the Guaranteed
Indebtedness shall be limited, with respect to each Guarantor, to an aggregate
amount equal to the largest amount that would not render such Guarantor’s
obligations hereunder subject to avoidance under Section 544 or 548 of the
United States Bankruptcy Code or under any applicable state law relating to
fraudulent transfers or conveyances.

2. Contribution Agreement. The Guarantors together desire to allocate among
themselves (collectively, the “Contributing Guarantors”), in a fair and
equitable manner, their obligations arising under this Guaranty Agreement and
the other Loan Documents. Accordingly, in the event any payment or distribution
is made by a Guarantor under this Guaranty Agreement or under the other Loan
Documents (a “Funding Guarantor”) that exceeds its Fair Share (as defined
below), that Funding Guarantor shall be entitled to a contribution from each of
the other Contributing Guarantors in the amount of such other Contributing
Guarantor’s Fair Share Shortfall (as defined below), with the result that all
such contributions will cause each Contributing Guarantor’s Aggregate Payments
(as defined below) to equal its Fair Share. “Fair Share” means, with respect to
a Contributing Guarantor as of any date of determination, an amount equal to
(i) the ratio of (x) the Adjusted Maximum Amount (as defined below) with respect
to such Contributing Guarantor to (y) the aggregate of the Adjusted Maximum
Amounts with respect to all Contributing Guarantors, multiplied by (ii) the
aggregate amount paid or distributed on or before such date by all Funding
Guarantors under the Loan Documents in respect of the obligations guarantied.
“Fair Share Shortfall” means, with respect to a Contributing Guarantor as of any
date of determination, the excess, if any, of the Fair Share of such
Contributing Guarantor over the Aggregate Payments of such Contributing
Guarantor. “Adjusted Maximum Amount” means, with respect to a Contributing
Guarantor as of any date of determination, the maximum aggregate amount of the
obligations of such Contributing Guarantor under this Guaranty Agreement
determined in accordance with the provisions hereof; provided that, solely for
purposes of calculating the “Adjusted Maximum Amount” with respect to any
Contributing Guarantor for purposes of this paragraph 2, the assets or

 

Page 1

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liabilities arising by virtue of any rights to or obligations of contribution
hereunder shall not be considered as assets or liabilities of such Contributing
Guarantor. “Aggregate Payments” means, with respect to a Contributing Guarantor
as of any date of determination, the aggregate amount of all payments and
distributions made on or before such date by such Contributing Guarantor in
respect of this Guaranty Agreement (including, without limitation, in respect of
this paragraph 2) and the other Loan Documents. The amounts payable as
contributions hereunder shall be determined as of the date on which the related
payment or distribution is made by the applicable Funding Guarantor. The
allocation among Contributing Guarantors of their obligations as set forth in
this paragraph 2 shall not be construed in any way to limit the liability of any
Contributing Guarantor hereunder.

3. Absolute and Irrevocable Guaranty. This instrument shall be an absolute,
continuing, irrevocable and unconditional guaranty of payment and performance,
and not a guaranty of collection, and each Guarantor shall remain liable on its
obligations hereunder until the payment and performance in full of the
Guaranteed Indebtedness. No set-off, counterclaim, recoupment, reduction, or
diminution of any obligation, or any defense of any kind or nature which
Borrower may have against any Secured Party or any other party, or which any
Guarantor may have against Borrower, any Secured Party or any other party, shall
be available to, or shall be asserted by, any Guarantor against any Secured
Party or any subsequent holder of the Guaranteed Indebtedness or any part
thereof or against payment of the Guaranteed Indebtedness or any part thereof
other than Full Satisfaction of the Obligations. If the payment of any amount of
principal of, interest with respect to or any other amount constituting the
Guaranteed Indebtedness, or any portion thereof, is rescinded, voided or must
otherwise be refunded by the Administrative Agent or any Loan Party for any
reason, then the Guaranteed Indebtedness and all terms and provisions of this
Guaranty Agreement will be automatically reinstated and become automatically
effective and in full force and effect, all to the extent that and as though
such payment so rescinded, voided or otherwise refunded had never been made.

4. Rights Cumulative. If a Guarantor becomes liable for any indebtedness owing
by Borrower to any Secured Party by endorsement or otherwise, other than under
this Guaranty Agreement, such liability shall not be in any manner impaired or
affected hereby, and the rights of the Secured Parties hereunder shall be
cumulative of any and all other rights that any Secured Party may ever have
against such Guarantor. The exercise by any Secured Party of any right or remedy
hereunder or under any other instrument, or at law or in equity, shall not
preclude the concurrent or subsequent exercise of any other right or remedy.

5. Agreement to Pay Guaranteed Indebtedness. In the event of default by Borrower
in payment or performance of the Guaranteed Indebtedness, or any part thereof,
when such Guaranteed Indebtedness becomes due, whether by its terms, by
acceleration, or otherwise, the Guarantors shall, jointly and severally,
promptly pay the amount due thereon to Administrative Agent, without notice or
demand, in lawful currency of the United States of America, and it shall not be
necessary for Administrative Agent or any other Secured Party, in order to
enforce such payment by any Guarantor, first to institute suit or exhaust its
remedies against Borrower or others liable on such Guaranteed Indebtedness, or
to enforce any rights against any collateral which shall ever have been given to
secure such Guaranteed Indebtedness. In the event such payment is made by a
Guarantor, then such Guarantor shall be subrogated to the rights then held by
Administrative Agent and any other Secured Party with respect to the Guaranteed
Indebtedness to the extent to which the Guaranteed Indebtedness was discharged
by such Guarantor. Notwithstanding the foregoing, upon payment by such Guarantor
of any sums to Administrative Agent or any other Secured Party hereunder, all
rights of such Guarantor against Borrower, any other guarantor or any collateral
arising as a result therefrom by way of right of subrogation, reimbursement,
contribution or otherwise shall in all respects be subordinate and junior in
right of payment to the prior Full Satisfaction of the Obligations. All payments
received by the Administrative Agent hereunder shall be applied by the
Administrative Agent to payment of the Guaranteed Indebtedness in the order
provided for in Section 2.14(f) of the Credit Agreement.

 

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6. Stay of Acceleration. If acceleration of the time for payment of any amount
payable by Borrower under the Guaranteed Indebtedness is stayed upon the
insolvency, bankruptcy, or reorganization of Borrower, all such amounts
otherwise subject to acceleration under the terms of the Guaranteed Indebtedness
shall nonetheless be payable by the Guarantors hereunder forthwith on demand by
Administrative Agent or any other Secured Party.

7. Obligations Not Impaired. Each Guarantor hereby agrees that its obligations
under the Loan Documents shall not be released, discharged, diminished,
impaired, reduced, or affected for any reason or by the occurrence of any event,
including, without limitation, one or more of the following events, whether or
not with notice to or the consent of any Guarantor: (a) the taking or accepting
of collateral as security for any or all of the Guaranteed Indebtedness or the
release, surrender, exchange, or subordination of any collateral now or
hereafter securing any or all of the Guaranteed Indebtedness; (b) any partial
release of the liability of any Guarantor hereunder, or the full or partial
release of any other guarantor from liability for any or all of the Guaranteed
Indebtedness; (c) any disability of Borrower, or the dissolution, insolvency, or
bankruptcy of Borrower, any Guarantor, or any other party at any time liable for
the payment of any or all of the Guaranteed Indebtedness; (d) any renewal,
extension, modification, waiver, amendment, or rearrangement of any or all of
the Guaranteed Indebtedness or any instrument, document, or agreement
evidencing, securing, or otherwise relating to any or all of the Guaranteed
Indebtedness; (e) any adjustment, indulgence, forbearance, waiver, or compromise
that may be granted or given by Administrative Agent or any other Secured Party
to Borrower, any Guarantor, or any other party ever liable for any or all of the
Guaranteed Indebtedness; (f) any neglect, delay, omission, failure, or refusal
of Administrative Agent or any other Secured Party to take or prosecute any
action for the collection of any of the Guaranteed Indebtedness or to foreclose
or take or prosecute any action in connection with any instrument, document, or
agreement evidencing, securing, or otherwise relating to any or all of the
Guaranteed Indebtedness; (g) the unenforceability or invalidity of any or all of
the Guaranteed Indebtedness or of any instrument, document, or agreement
evidencing, securing, or otherwise relating to any or all of the Guaranteed
Indebtedness; (h) any payment by Borrower or any other party to Administrative
Agent or any other Secured Party is held to constitute a preference under
applicable bankruptcy or insolvency law or if for any other reason
Administrative Agent or any other Secured Party is required to refund any
payment or pay the amount thereof to someone else; (i) the settlement or
compromise of any of the Guaranteed Indebtedness; (j) the non-perfection of any
security interest or lien securing any or all of the Guaranteed Indebtedness;
(k) any impairment of any collateral securing any or all of the Guaranteed
Indebtedness; (l) the failure of Administrative Agent or any other Secured Party
to sell any collateral securing any or all of the Guaranteed Indebtedness in a
commercially reasonable manner or as otherwise required by law; (m) any change
in the corporate existence, structure, or ownership of Borrower; or (n) any
other circumstance which might otherwise constitute a defense available to, or
discharge of, Borrower or any other Guarantor (other than the Full Satisfaction
of the Obligations).

8. Representations and Warranties. Each Guarantor represents and warrants to
Administrative Agent and the Lenders as follows:

(a) Credit Agreement Representations. All representations and warranties in the
Credit Agreement relating to it are true and correct as of the date hereof and
on each date the representations and warranties hereunder are restated pursuant
to any of the Loan Documents with the same force and effect as if such
representations and warranties had been made on and as of such date except to
the extent that such representations and warranties relate specifically to
another date.

 

Page 3

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(b) Independent Analysis. It has, independently and without reliance upon
Administrative Agent or any Lender and based upon such documents and information
as it has deemed appropriate, made its own analysis and decision to enter into
the Loan Documents to which it is a party.

(c) Borrower Information. It has adequate means to obtain from Borrower on a
continuing basis information concerning the financial condition and assets of
Borrower and it is not relying upon Administrative Agent or any Lender to
provide (and neither the Administrative Agent nor any Lender shall have any duty
to provide) any such information to it either now or in the future.

(d) Benefit of Guaranty. The value of the consideration received and to be
received by each Guarantor as a result of Borrower’s and the Lenders’ entering
into the Credit Agreement and each Guarantor’s executing and delivering this
Guaranty Agreement is reasonably worth at least as much as the liability and
obligation of each Guarantor hereunder, and such liability and obligation and
the Credit Agreement have benefited and may reasonably be expected to benefit
each Guarantor directly or indirectly.

9. Covenants of Guarantor. Each Guarantor covenants and agrees that until the
Loan Obligations have been Fully Satisfied, it will comply with all covenants
set forth in the Credit Agreement specifically applicable to it.

10. Right of Set Off. When an Event of Default exists and subject to the terms
of Section 2.14 of the Credit Agreement, Administrative Agent and each other
Secured Party shall have the right to set-off and apply against this Guaranty
Agreement or the Guaranteed Indebtedness or both, at any time and without notice
to any Guarantor, any and all deposits (general or special, time or demand,
provisional or final) or other sums at any time credited by or owing from
Administrative Agent and each other Secured Party to any Guarantor whether or
not the Guaranteed Indebtedness is then due and irrespective of whether or not
Administrative Agent or any other Secured Party shall have made any demand under
this Guaranty Agreement. Each Secured Party agrees promptly to notify the
Borrower (with a copy to the Administrative Agent) after any such setoff and
application, provided that the failure to give such notice shall not affect the
validity of such setoff and application. The rights and remedies of
Administrative Agent and other Secured Parties hereunder are in addition to
other rights and remedies (including, without limitation, other rights of
set-off) which Administrative Agent or any other Secured Party may have.

11. Intercompany Subordination.

(a) Debt Subordination. Each Guarantor hereby agrees that the Subordinated
Indebtedness (as defined below) shall be subordinate and junior in right of
payment to the Full Satisfaction of the Obligations. The Subordinated
Indebtedness shall not be payable, and no payment of principal, interest or
other amounts on account thereof, and no property or guarantee of any nature to
secure or pay the Subordinated Indebtedness shall be made or given, directly or
indirectly by or on behalf of any Debtor (hereafter defined) or received,
accepted, retained or applied by any Guarantor unless and until the Obligations
shall have been Fully Satisfied; except that prior to the occurrence and
continuance of an Event of Default, each Debtor shall have the right to make
payments and a Guarantor shall have the right to receive payments on the
Subordinated Indebtedness from time to time in the ordinary course of business.
When an Event of Default exists, no payments may be made or given on the
Subordinated Indebtedness, directly or indirectly, by or on behalf of any Debtor
or received, accepted, retained or applied by any Guarantor unless and until the
Obligations shall have been Fully Satisfied. If any sums shall be

 

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paid to a Guarantor by any Debtor or any other Person on account of the
Subordinated Indebtedness when such payment is not permitted hereunder, such
sums shall be held in trust by such Guarantor for the benefit of Administrative
Agent and the other Secured Parties and shall forthwith be paid to
Administrative Agent and applied by Administrative Agent against the Guaranteed
Indebtedness in accordance with this Guaranty Agreement. For purposes of this
Guaranty Agreement and with respect to a Guarantor, the term “Subordinated
Indebtedness” means all indebtedness, liabilities, and obligations of Borrower
or any other Guarantor (Borrower and such other Guarantor herein the “Debtors”)
to such Guarantor, whether such indebtedness, liabilities, and obligations now
exist or are hereafter incurred or arise, or are direct, indirect, contingent,
primary, secondary, several, joint and several, or otherwise, and irrespective
of whether such indebtedness, liabilities, or obligations are evidenced by a
note, contract, open account, or otherwise, and irrespective of the Person or
Persons in whose favor such indebtedness, obligations, or liabilities may, at
their inception, have been, or may hereafter be created, or the manner in which
they have been or may hereafter be acquired by such Guarantor.

(b) Lien Subordination. Each Guarantor agrees that any and all Liens (including
any judgment liens), upon any Debtor’s assets securing payment of any
Subordinated Indebtedness shall be and remain inferior and subordinate to any
and all Liens upon any Debtor’s assets securing payment of the Guaranteed
Indebtedness or any part thereof, regardless of whether such Liens in favor of a
Guarantor, Administrative Agent or any other Secured Party presently exist or
are hereafter created or attached. Without the prior written consent of
Administrative Agent, no Guarantor shall (i) file suit against any Debtor or
exercise or enforce any other creditor’s right it may have against any Debtor,
or (ii) foreclose, repossess, sequester, or otherwise take steps or institute
any action or proceedings (judicial or otherwise, including without limitation
the commencement of, or joinder in, any liquidation, bankruptcy, rearrangement,
debtor’s relief or insolvency proceeding) to enforce any obligations of any
Debtor to such Guarantor or any Liens held by such Guarantor on assets of any
Debtor.

(c) Insolvency Proceeding. In the event of any receivership, bankruptcy,
reorganization, rearrangement, debtor’s relief, or other insolvency proceeding
involving any Debtor as debtor, Administrative Agent shall have the right to
prove and vote any claim under the Subordinated Indebtedness and to receive
directly from the receiver, trustee or other court custodian all dividends,
distributions, and payments made in respect of the Subordinated Indebtedness
until the Obligations have been Fully Satisfied. The Administrative Agent may
apply any such dividends, distributions, and payments against the Guaranteed
Indebtedness in accordance with the Credit Agreement.

12. Amendment and Waiver. Except for modifications made pursuant to the
execution and delivery of a Subsidiary Joinder Agreement (which needs to be
signed only by the Subsidiary party thereto) and the release of any Guarantor
from its obligations hereunder (which shall require the consent of all Lenders
except as otherwise provided in Section 9.10 of the Credit Agreement); no
amendment or waiver of any provision of this Guaranty Agreement or consent to
any departure by any Guarantor therefrom shall in any event be effective unless
the same shall be in writing and signed by the parties required by
Section 10.02(b) of the Credit Agreement. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.

13. Tolling of Statutes of Limitation. To the extent permitted by law, any
acknowledgment or new promise, whether by payment of principal or interest or
otherwise and whether by Borrower or others (including any Guarantor), with
respect to any of the Guaranteed Indebtedness shall, if the statute of
limitations in favor of a Guarantor against Administrative Agent or any other
Secured Party shall have commenced to run, toll the running of such statute of
limitations and, if the period of such statute of limitations shall have
expired, prevent the operation of such statute of limitations.

 

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14. Successor and Assigns. This Guaranty Agreement is for the benefit of the
Secured Parties and their successors and assigns, and in the event of an
assignment of the Guaranteed Indebtedness, or any part thereof, the rights and
benefits hereunder, to the extent applicable to the indebtedness so assigned,
may be transferred with such indebtedness. This Guaranty Agreement is binding
not only on each Guarantor, but on each Guarantor’s successors and assigns. No
Guarantor may assign or otherwise transfer any of its rights or obligations
hereunder without prior written consent of each Lender except as otherwise
permitted by the Credit Agreement and any attempted assignment or transfer
without such consent shall be null and void.

15. Reliance and Inducement. Each Guarantor recognizes that Administrative Agent
and the Lenders are relying upon this Guaranty Agreement and the undertakings of
each Guarantor hereunder and under the other Loan Documents to which each is a
party in making extensions of credit to Borrower under the Credit Agreement and
further recognizes that the execution and delivery of this Guaranty Agreement
and the other Loan Documents to which each Guarantor is a party is a material
inducement to Administrative Agent and the Lenders in entering into the Credit
Agreement and continuing to extend credit thereunder. Each Guarantor hereby
acknowledges that there are no conditions to the full effectiveness of this
Guaranty Agreement or any other Loan Document to which it is a party.

16. Notice. Any notice or demand to any Guarantor under or in connection with
this Guaranty Agreement or any other Loan Document to which it is a party shall
be deemed effective if given to the Guarantor, care of Borrower in accordance
with the notice provisions in the Credit Agreement.

17. Expenses. The Guarantors shall, jointly and severally, pay on demand all
reasonable attorneys’ fees and all other reasonable costs and expenses incurred
by Administrative Agent and the other Secured Parties in connection with the
administration, enforcement, or collection of this Guaranty Agreement.

18. Waiver of Promptness, Diligence, etc. Except as otherwise specifically
provided in the Credit Agreement, each Guarantor hereby waives promptness,
diligence, notice of any default under the Guaranteed Indebtedness, demand of
payment, notice of acceptance of this Guaranty Agreement, presentment, notice of
protest, notice of dishonor, notice of the incurring by Borrower of additional
indebtedness, and all other notices and demands with respect to the Guaranteed
Indebtedness and this Guaranty Agreement.

19. Incorporation of Credit Agreement. The Credit Agreement, and all of the
terms thereof, are incorporated herein by reference (including, without
limitation, Sections 10.03(b) and 10.19 thereof), the same as if stated verbatim
herein, and each Guarantor agrees that Administrative Agent and the Lenders may
exercise any and all rights granted to any of them under the Credit Agreement
and the other Loan Documents without affecting the validity or enforceability of
this Guaranty Agreement.

20. Entire Agreement. This Guaranty Agreement embodies the final, entire
agreement of each Guarantor, agent and the other Loan Parties with respect to
each Guarantor’s guaranty of the Guaranteed Indebtedness and supersedes any and
all prior commitments, agreements, representations, and understandings, whether
written or oral, relating to the subject matter hereof. This Guaranty Agreement
is intended by each Guarantor, Administrative Agent and the other Loan Parties
as a final and complete expression of the terms of the Guaranty Agreement, and
no course of dealing among any Guarantor, the Administrative Agent and any other
Loan Parties, no course of performance, no trade practices, and no evidence of
prior, contemporaneous or subsequent oral agreements or discussions or other
extrinsic evidence of any nature shall be used to contradict, vary, supplement
or modify any term of this Guaranty Agreement.

 

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21. No Waiver. No failure or delay by the Administrative Agent or any Secured
Party in exercising any right or power hereunder or under any other Loan
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power.

22. Survival. All covenants, agreements, representations and warranties made by
the Loan Parties in the Loan Documents and in the certificates or other
instruments delivered in connection with or pursuant to this Guaranty Agreement
or any other Loan Document shall be considered to have been relied upon by the
other parties hereto and shall survive the execution and delivery of the Loan
Documents and the making of any Loans, regardless of any investigation made by
any such other party or on its behalf and notwithstanding that the
Administrative Agent or any Secured Party may have had notice or knowledge of
any Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect until the
Obligations have been Fully Satisfied.

23. Counterparts. This Guaranty Agreement may be executed in counterparts (and
by different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. Delivery of an executed counterpart of a signature page of this
Guaranty Agreement by telecopy or other electronic transmission shall be
effective as delivery of a manually executed counterpart of this Guaranty
Agreement.

24. Severability. Any provision of this Guaranty Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.

25. Governing Law. This Guaranty Agreement shall be governed by and construed in
accordance with the applicable law pertaining in the State of New York, other
than those conflict of law provisions that would defer to the substantive laws
of another jurisdiction. This governing law election has been made by the
parties in reliance (at least in part) on Section 5–1401 of the General
Obligations Law of the State of New York, as amended (as and to the extent
applicable), and other applicable law.

26. Jurisdiction. EACH GUARANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS,
FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE SUPREME
COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED
STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE
COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO ANY LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT
ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH NEW YORK STATE OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH
FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY
SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS GUARANTY AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY
RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY

 

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OTHER SECURED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS GUARANTY AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST ANY
GUARANTOR OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

27. Venue. Each Guarantor 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 Guaranty Agreement or any other Loan Document
in any court referred to paragraph 26. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

28. Service of Process. Each party to this Guaranty Agreement irrevocably
consents to service of process in the manner provided for notices in
paragraph 16. Nothing in this Guaranty Agreement or any other Loan Document will
affect the right of any party to this Guaranty Agreement to serve process in any
other manner permitted by law. Each Guarantor hereby irrevocably designates,
appoints and empowers the Borrower as its designee, appointee and agent to
receive, accept and acknowledge for and on its behalf, and in respect of its
property, service of any and all legal process, summons, notices and documents
which may be served in any such action or proceeding.

29. Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
GUARANTY AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER 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 GUARANTY AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS PARAGRAPH.

30. Headings. All paragraph headings used herein are for convenience of
reference only, are not part of this Guaranty Agreement and shall not affect the
construction of, or be taken into consideration in interpreting, this Guaranty
Agreement.

 

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EXECUTED as of the date first written above.

 

GUARANTORS: ALLIED AIR ENTERPRISES LLC ADVANCED DISTRIBUTOR PRODUCTS LLC
HEATCRAFT INC. HEATCRAFT REFRIGERATION PRODUCTS LLC LENNOX GLOBAL LTD. LENNOX
INDUSTRIES INC. LGL AUSTRALIA (US) INC. LENNOX NATIONAL ACCOUNT SERVICES LLC By:
 

 

  Rick Pelini, Authorized Officer for each Guarantor

 

Page 9

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EXHIBIT A

TO

GUARANTY AGREEMENT

Subsidiary Joinder Agreement

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

SUBSIDIARY JOINDER AGREEMENT

This SUBSIDIARY JOINDER AGREEMENT (the “Agreement”) dated as of             
    , 201     is executed by the undersigned (the “Debtor”) for the benefit of
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, in its capacity as agent for the
lenders party to the hereafter identified Credit Agreement (in such capacity
herein, the “Agent”) and for the benefit of such lenders in connection with that
certain Short Term Facility Agreement among LENNOX INTERNATIONAL INC.
(“Borrower”), the lenders party thereto (the “Lenders”), JPMORGAN CHASE BANK,
N.A., as the administrative agent for the Lenders (the “Agent”) (such Credit
Agreement, as it may hereafter be amended or otherwise modified from time to
time, being hereinafter referred to as the “Credit Agreement”, and capitalized
terms not otherwise defined herein shall have the same meaning as set forth in
the Credit Agreement) (as modified, the “Credit Agreement”, and capitalized
terms not otherwise defined herein being used herein as defined in the Credit
Agreement).

The Debtor [is a newly formed or newly acquired Material Subsidiary and] is
required to execute this Agreement pursuant to Section 5.11 of the Credit
Agreement.

NOW THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Debtor hereby agrees as follows:

1. The Debtor hereby assumes all the obligations of a “Guarantor” under the
Guaranty Agreement and agrees that it is a “Guarantor” and bound as a
“Guarantor” under the terms of the Guaranty Agreement as if it had been an
original signatory thereto. In accordance with the foregoing and for valuable
consideration, the receipt and adequacy of which are hereby acknowledged, Debtor
irrevocably and unconditionally guarantees to the Administrative Agent and the
other Secured Parties the full and prompt payment and performance of the
Guaranteed Indebtedness (as defined in the Guaranty Agreement) upon the terms
and conditions set forth in the Guaranty Agreement.

2. This Agreement shall be deemed to be part of, and a modification to, the
Guaranty Agreement and shall be governed by all the terms and provisions of the
Guaranty Agreement, which terms are incorporated herein by reference, are
ratified and confirmed and shall continue in full force and effect as valid and
binding agreements of Debtor enforceable against Debtor. The Debtor hereby
waives notice of Agent’s or any other Secured Parties’ acceptance of this
Agreement.

IN WITNESS WHEREOF, the Debtor has executed this Agreement as of the day and
year first written above.

 

Debtor:

 

By:  

 

  Name:  

 

  Title:  

 

 

Page 1

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EXHIBIT D

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

Interest Election Request

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

INTEREST ELECTION REQUEST

                 , 201    

JPMorgan Chase Bank, National Association

Loan and Agency Services Group

10 South Dearborn Street, 7th Floor

Chicago, IL 60603

Attention: Nan Wilson

Telephone: 312-385-7084

Telecopy: 888-292-9533

and each Lender

Ladies and Gentlemen:

The undersigned, Lennox International Inc. (the “Borrower”), refers to the Short
Term Facility Agreement dated as of October 20, 2014 among the Borrower, the
Lenders party thereto and JPMorgan Chase Bank, National Association, as the
Administrative Agent (as amended or otherwise modified from time to time, the
“Credit Agreement”). Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Credit Agreement.

The Borrower hereby gives the Administrative Agent and the Lenders notice
pursuant to Section 2.04 of the Credit Agreement that the Borrower requests a
conversion or continuation (a “Change”) of the Borrowing or Borrowings specified
on Schedule 1.

By its execution below, the Borrower represents and warrants to the
Administrative Agent and the Lenders:

(i) At the time of and immediately after giving effect to the requested Change,
no Default exists; and

(ii) The representations and warranties of each Loan Party set forth in the Loan
Documents shall be true and correct on and as of the date of the requested
Change except to the extent such representations and warranties specifically
relate to any earlier date in which case such representations and warranties
shall have been true and correct in all material respects as of such earlier
date.

The instructions set forth herein are irrevocable, except as otherwise provided
by the Credit Agreement. A telecopy of these instructions shall be deemed valid
and may be accepted and relied upon by the Administrative Agent and the Lenders
as an original.

 

LENNOX INTERNATIONAL INC. By:  

 

  Name:  

 

  Title:  

 

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

SCHEDULE 1

TO

INTEREST ELECTION REQUEST

 

Term Loan

   Current Type
(ABR or
Eurodollar)    Current
Principal Amount    Current
Interest Period
Expiration Date    Continue as
(Type)    Convert
to (Type)    New
Interest Period
Length    Effective
Date                                                                           
                             

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

EXHIBIT E-1

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

Form of U.S. Tax Certificate (For Non-U.S. Lenders that are not Partnerships for
U.S. Federal Income Tax Purposes)

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

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to the Short Term Facility Agreement (as amended, the
“Agreement”) dated as of October 20, 2014 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Lennox International
Inc. (the “Borrower”), JPMorgan Chase Bank, National Association, as
administrative agent, and the Lenders named therein.

Pursuant to the provisions of Section 2.13 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and beneficial owner
of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of
which it is providing this certificate, (ii) it is not a bank within the meaning
of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder
of the Borrower within the meaning of Section 871(h)(3)(B) of the Code and
(iv) it is not a controlled foreign corporation related to the Borrower as
described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with a
certificate of its non-U.S. Person status on IRS Form W-8BEN or W-8BEN-E, as
applicable. By executing this certificate, the undersigned agrees that (1) if
the information provided on this certificate changes, the undersigned shall
promptly so inform the Borrower and the Administrative Agent, and (2) the
undersigned shall have at all times furnished the Borrower and the
Administrative Agent with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF LENDER] By:  

 

  Name:     Title:  

Date:                  , 20[    ]

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

EXHIBIT E-2

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

Form of U.S. Tax Certificate (For Non-U.S. Participants that are not
Partnerships for U.S. Federal Income Tax Purposes)

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

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to the Short Term Facility Agreement (as amended, the
“Agreement”) dated as of October 20, 2014 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Lennox International
Inc. (the “Borrower”), JPMorgan Chase Bank, National Association, as
administrative agent, and the Lenders named therein.

Pursuant to the provisions of Section 2.13 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and beneficial owner
of the participation in respect of which it is providing this certificate,
(ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code,
(iii) it is not a ten percent shareholder of the Borrower within the meaning of
Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign
corporation related to the Borrower as described in Section 881(c)(3)(C) of the
Code.

The undersigned has furnished its participating Lender with a certificate of its
non-U.S. Person status on IRS Form W-8BEN or W-8BEN-E, as applicable. By
executing this certificate, the undersigned agrees that (1) if the information
provided on this certificate changes, the undersigned shall promptly so inform
such Lender in writing, and (2) the undersigned shall have at all times
furnished such Lender with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF PARTICIPANT] By:  

 

  Name:     Title:  

Date:                  , 20[    ]

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EXHIBIT E-3

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

Form of U.S. Tax Certificate (For Non-U.S. Participants that are Partnerships
for U.S. Federal Income Tax Purposes)

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

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to the Short Term Facility Agreement (as amended, the
“Agreement”) dated as of October 20, 2014 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Lennox International
Inc. (the “Borrower”), JPMorgan Chase Bank, National Association, as
administrative agent, and the Lenders named therein.

Pursuant to the provisions of Section 2.13 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the
participation in respect of which it is providing this certificate, (ii) its
direct or indirect partners/members are the sole beneficial owners of such
participation, (iii) with respect such participation, neither the undersigned
nor any of its direct or indirect partners/members is a bank extending credit
pursuant to a loan agreement entered into in the ordinary course of its trade or
business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of
its direct or indirect partners/members is a ten percent shareholder of the
Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of
its direct or indirect partners/members is a controlled foreign corporation
related to the Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with IRS Form W-8IMY
accompanied by one of the following forms from each of its partners/members that
is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or
W-8BEN-E, as applicable or (ii) an IRS Form W-8IMY accompanied by an IRS Form
W-8BEN or W-8BEN-E, as applicable from each of such partner’s/member’s
beneficial owners that is claiming the portfolio interest exemption. By
executing this certificate, the undersigned agrees that (1) if the information
provided on this certificate changes, the undersigned shall promptly so inform
such Lender and (2) the undersigned shall have at all times furnished such
Lender with a properly completed and currently effective certificate in either
the calendar year in which each payment is to be made to the undersigned, or in
either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF PARTICIPANT] By:     Name:     Title:  

Date:                  , 20[    ]

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EXHIBIT E-4

TO

LENNOX INTERNATIONAL INC.

SHORT TERM FACILITY AGREEMENT

Form of U.S. Tax Certificate (For Non-U.S. Lenders that are Partnerships for
U.S. Federal Income Tax Purposes)

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

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Short Term Facility Agreement (as amended, the
“Agreement”) dated as of October 20, 2014 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Lennox International
Inc. (the “Borrower”), JPMorgan Chase Bank, National Association, as
administrative agent, and the Lenders named therein.

Pursuant to the provisions of Section 2.13 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the Loan(s)
(as well as any Note(s) evidencing such Loan(s)) in respect of which it is
providing this certificate, (ii) its direct or indirect partners/members are the
sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing such
Loan(s)), (iii) with respect to the extension of credit pursuant to this Credit
Agreement or any other Loan Document, neither the undersigned nor any of its
direct or indirect partners/members is a bank extending credit pursuant to a
loan agreement entered into in the ordinary course of its trade or business
within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct
or indirect partners/members is a ten percent shareholder of the Borrower within
the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or
indirect partners/members is a controlled foreign corporation related to the
Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with IRS
Form W-8IMY accompanied by one of the following forms from each of its
partners/members that is claiming the portfolio interest exemption: (i) an IRS
Form W-8BEN or W-8BEN-E, as applicable or (ii) an IRS Form W-8IMY accompanied by
an IRS Form W-8BEN or W-8BEN-E, as applicable from each of such
partner’s/member’s beneficial owners that is claiming the portfolio interest
exemption. By executing this certificate, the undersigned agrees that (1) if the
information provided on this certificate changes, the undersigned shall promptly
so inform the Borrower and the Administrative Agent, and (2) the undersigned
shall have at all times furnished the Borrower and the Administrative Agent with
a properly completed and currently effective certificate in either the calendar
year in which each payment is to be made to the undersigned, or in either of the
two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF LENDER] By:     Name:     Title:  

Date:                  , 20[    ]