Exhibit 10.A

 

 

 

 

LOGO [g307631snap1.jpg]

AMENDED AND RESTATED CREDIT AGREEMENT

dated as of

November 30, 2016

between

NEOGEN CORPORATION

and

JPMORGAN CHASE BANK, N.A.

 

 

 

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TABLE OF CONTENTS

 

     Page   ARTICLE I. Definitions      1    SECTION 1.01. Defined Terms      1
   SECTION 1.02. [intentionally omitted]      13    SECTION 1.03. Terms
Generally      13    SECTION 1.04. Accounting Terms; GAAP      14    [SECTION
1.05. Pro Forma Adjustments for Acquisitions and Dispositions]      14   
SECTION 1.06. Rounding      14    ARTICLE II. The Credit      14    SECTION
2.01. Commitment      14    SECTION 2.02. [intentionally omitted]      15   
SECTION 2.03. Borrowing Procedures; Requests for Loans      15    SECTION
2.04. Letters of Credit      15    SECTION 2.05. Funding of Borrowings      18
   SECTION 2.06. [intentionally omitted]      18    SECTION 2.07. Termination of
Commitment      18    SECTION 2.08. Repayment of Loans; Evidence of Debt.     
18    SECTION 2.09. Prepayment of Loans      19    SECTION 2.10. Fees      19   
SECTION 2.11. Interest      19    SECTION 2.12. Inability to Determine Interest
Rate      20    SECTION 2.13. Increased Costs.      20    SECTION
2.14. Illegality      21    SECTION 2.15. Taxes      21    SECTION
2.16. Payments Generally; Allocation of Proceeds      22    SECTION
2.17. Indemnity for Returned Payments      23    ARTICLE III. Representations
and Warranties      24    SECTION 3.01. Organization; Powers      24    SECTION
3.02. Authorization; Enforceability      24    SECTION 3.03. Governmental
Approvals; No Conflicts      24    SECTION 3.04. Financial Condition; No
Material Adverse Change      24    SECTION 3.05. Properties      25    SECTION
3.06. Litigation and Environmental Matters      25    SECTION 3.07. Compliance
with Laws and Agreements; No Default      25    SECTION 3.08. Investment Company
Status      25    SECTION 3.09. Taxes      25    SECTION 3.10. ERISA      26   
SECTION 3.11. Disclosure      26    SECTION 3.12. Material Agreements      26   
SECTION 3.13. Solvency      26    SECTION 3.14. Insurance      26    SECTION
3.15. Capitalization      26    SECTION 3.16. [intentionally omitted]      26   
SECTION 3.17. Employment Matters      26   

 

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     Page   SECTION 3.18. Federal Reserve Regulations      27    SECTION 3.19.
Use of Proceeds      27    SECTION 3.20. No Burdensome Restrictions      27   
SECTION 3.21. Anti-Corruption Laws and Sanctions      27    ARTICLE
IV. Conditions      27    SECTION 4.01. Effective Date      27    SECTION
4.02. Each Credit Event      28    ARTICLE V. Affirmative Covenants      29   
SECTION 5.01. Financial Statements and Other Information      29    SECTION
5.02. Notices of Material Events      30    SECTION 5.03. Existence; Conduct of
Business      31    SECTION 5.04. Payment of Obligations      31   
SECTION 5.05. Maintenance of Properties      31    SECTION 5.06. Books and
Records; Inspection Rights      31    SECTION 5.07. Compliance with Laws and
Material Contractual Obligations.      31    SECTION 5.08. Use of Proceeds     
32    SECTION 5.09. Accuracy of Information      32    SECTION 5.10. Insurance
     32    SECTION 5.13. Depository Banks      32    SECTION 5.14. Further
Assurances      32    ARTICLE VI. Negative Covenants      33    SECTION
6.01. Indebtedness      33    SECTION 6.02. Liens      34    SECTION
6.03. Fundamental Changes      34    SECTION 6.04. Acquisitions      35   
SECTION 6.05. [reserved]      35    SECTION 6.06. Sale and Leaseback
Transactions      35    SECTION 6.07. Swap Agreements      35    SECTION
6.08. Restricted Payments; Certain Payments of Indebtedness.      35    SECTION
6.09. Transactions with Affiliates      36    SECTION 6.10. Negative Pledge
Agreements      36    SECTION 6.11. Other Restrictive Agreements      36   
SECTION 6.12. Amendment of Material Documents      36    SECTION 6.13. Financial
Covenants      37    ARTICLE VII. Events of Default      37    ARTICLE
VIII. Miscellaneous      39    SECTION 8.01. Notices      39    SECTION
8.02. Waivers; Amendments      41    SECTION 8.03. Expenses; Indemnity; Damage
Waiver      41    SECTION 8.04. Successors and Assigns      42    SECTION
8.05. Survival      44    SECTION 8.06. Counterparts; Integration;
Effectiveness; Electronic Execution.      44    SECTION 8.07. Severability     
45    SECTION 8.08. Right of Setoff      45    SECTION 8.09. Governing Law;
Jurisdiction; Consent to Service of Process      45    SECTION 8.10. WAIVER OF
JURY TRIAL.      45    SECTION 8.11. Headings      46    SECTION
8.12. Confidentiality      46    SECTION 8.13. Nonreliance; Violation of Law   
  46    SECTION 8.14. USA PATRIOT Act      46    SECTION 8.15. Disclosure     
46   

 

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     Page   SECTION 8.16. Interest Rate Limitation      47    SECTION
8.17. [reserved]      47    SECTION 8.18. Amended and Restated Agreement      47
  

EXHIBITS:

Exhibit A - Compliance Certificate

 

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AMENDED AND RESTATED CREDIT AGREEMENT dated as of November 30, 2016 (as it may
be amended or modified from time to time, this “Agreement”), among NEOGEN
CORPORATION, a Michigan corporation, as Borrower and JPMORGAN CHASE BANK, N.A.,
as Lender.

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:

“Acquisition” means any transaction, or any series of related transactions,
consummated on or after the Effective Date, by which the Borrower or any
Subsidiary (a) acquires any going business or all or substantially all of the
assets of any Person, whether through purchase of assets, merger or otherwise or
(b) directly or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in number of
votes) of the Equity Interests of a Person which has ordinary voting power for
the election of directors or other similar management personnel of a Person
(other than Equity Interests having such power only by reason of the happening
of a contingency) or a majority of the outstanding Equity Interests of a Person.

“Adjusted LIBO Rate” means, with respect to any Loan for any Interest Period, an
interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%)
equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the
Statutory Reserve Rate.

“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 specified Person.

“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 Loan, 1.00% per annum.

“Approved Fund” has the meaning assigned to such term in Section 8.04(b).

“Availability Period” means the period from and including the Effective Date to
but excluding the earlier of the Maturity Date and the date of termination of
the Commitment.

“Banking Services” means each and any of the following bank services provided to
the Borrower or any Subsidiary by the Lender or any of its Affiliates: (a)
credit cards for commercial customers (including, without limitation,
“commercial credit cards” and purchasing cards), (b) stored value cards, (c)
merchant processing services, and (d) treasury management services (including,
without limitation, controlled disbursement, automated clearinghouse
transactions, return items, any direct debit scheme or arrangement, overdrafts
and interstate depository network services).

“Banking Services Obligations” means any and all obligations of the Borrower or
its Subsidiaries, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor) in connection with Banking
Services.

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“Board” means the Board of Governors of the Federal Reserve System of the U.S.

“Borrower” means Neogen Corporation, a Michigan corporation.

“Burdensome Restrictions” means any consensual encumbrance or restriction of the
type described in Section 6.10 or Section 6.11.

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed; provided that the term “Business Day” shall also exclude any day
on which banks are not open for general business in London.

“Capital Expenditures” means, without duplication, any expenditure or commitment
to expend money for any purchase or other acquisition of any asset which would
be classified as a fixed or capital asset on a consolidated balance sheet of the
Borrower and its Subsidiaries 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 (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any 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), of Equity Interests representing
more than 25% of the aggregate ordinary voting power represented by the issued
and outstanding Equity Interests of the Borrower; (b) occupation at any time of
a majority of the seats (other than vacant seats) on the board of directors of
the Borrower by Persons who were neither (i) directors of the Borrower on the
date of this Agreement nor (ii) nominated or appointed by the board of directors
of the Borrower; or (c) the acquisition of direct or indirect Control of the
Borrower by any Person or group.

“Change in Law” means the occurrence after the date of this Agreement of any of
the following: (a) the adoption of or taking effect of any law, rule, regulation
or treaty, (b) any change in any law, rule, regulation or treaty or in the
administration, interpretation or application thereof by any Governmental
Authority or (c) compliance by the Lender (or, for purposes of Section 2.13(b),
by any lending office of the Lender or by the Lender’s holding company, if any)
with any request, guideline, requirement 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,
(x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all
requests, rules, guidelines, requirements or directives thereunder or issued in
connection therewith or in the implementation thereof, and (y) all requests,
rules, guidelines, requirements or directives promulgated by the Bank for
International Settlements, the Basel Committee on Banking Supervision (or any
successor or similar authority) or the U.S. 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.

“Charges” has the meaning assigned to such term in Section 8.16.

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

“Commercial LC Exposure” means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding commercial Letters of Credit plus (b) the
aggregate amount of all LC Disbursements relating to commercial Letters of
Credit that have not yet been reimbursed by or on behalf of the Borrower.

 

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“Commitment” means the commitment of the Lender to make Loans and issue Letters
of Credit hereunder, as such commitment may be reduced from time to time
pursuant to Section 2.07. The initial amount of the Lender’s Revolving
Commitment is $15,000,000.

“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.

“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.

“Debt Service Coverage Ratio” means, for any period, the ratio of (a) EBITDA for
such period minus (i) the Unfinanced Capital Expenditures for such period and
(ii) Restricted Payments paid in cash during such period to (b) the sum of (i)
Interest Expense for such period, plus (ii) prior period current maturities of
Long Term Debt and capital leases.

“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.

“Dollars”, “dollars” or “$” refers to lawful money of the U.S.

“EBITDA” means, for any period, Net Income for such period plus (a) without
duplication and to the extent deducted in determining Net Income for such
period, the sum of (i) Interest Expense for such period, (ii) income tax expense
for such period, (iii) all amounts attributable to depreciation and amortization
expense for such period, (iv) any extraordinary charges for such period and (v)
any other non-cash charges for such period (but excluding any non-cash charge in
respect of an item that was included in Net Income in a prior period), minus (b)
without duplication and to the extent included in Net Income, (i) any cash
payments made during such period in respect of non-cash charges described in
clause (a)(v) taken in a prior period and (ii) any extraordinary gains and any
non-cash items of income for such period, all calculated for the Borrower and
its Subsidiaries on a consolidated basis in accordance with GAAP.

“Effective Date” means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 8.02).

“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, web
portal access for the Borrower, Intralinks®, ClearPar®, Debt Domain, Syndtrak
and any other Internet or extranet-based site, whether such electronic system is
owned, operated or hosted by the Lender and any of its respective Related
Parties or any other Person, providing for access to data protected by passcodes
or other security system.

 

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“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) any violation of any Environmental
Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) any 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.

“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 of the
foregoing.

“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 to
satisfy the “minimum funding standard” (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived; (c) the filing pursuant to
Section 412(c) of the Code or Section 302(c) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan; (d) the
incurrence by the Borrower or any ERISA Affiliate 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
ERISA Affiliate of any liability with respect to the withdrawal or partial
withdrawal of the Borrower or any ERISA Affiliate 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 upon the Borrower or any
ERISA Affiliate 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.

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

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
the Lender or required to be withheld or deducted from a payment to the Lender:
(a) Taxes imposed on or measured by net income (however denominated), franchise
Taxes, and branch profits Taxes, in each case, (i) imposed as a result of the
Lender being organized under the laws of, or having its principal office or its
applicable lending office located in, the jurisdiction imposing such Tax (or any
political subdivision thereof) or (ii) that are Other Connection Taxes, (b) U.S.
federal withholding Taxes imposed on amounts payable to or

 

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for the account of the Lender with respect to an applicable interest in a Loan,
Letter of Credit or Commitment pursuant to a law in effect on the date on which
(i) the Lender acquires such interest in the Loan, Letter of Credit or
Commitment or (ii) the Lender changes its lending office, except in each case to
the extent that, pursuant to Section 2.15, amounts with respect to such Taxes
were payable either to the Lender’s assignor immediately before the Lender
acquired the applicable interest in such Loan, Letter of Credit or Commitment or
to the Lender immediately before it changed its lending office and (c) any U.S.
federal withholding Taxes imposed under FATCA.

“Exposure” means, at any time, the sum of the aggregate outstanding principal
amount of the Lender’s Loans and its LC Exposure at such time.

“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 rate calculated by the
NYFRB based on such day’s federal funds transactions by depositary institutions
(as determined in such manner as the NYFRB shall set forth on its public website
from time to time) and published on the next succeeding Business Day by the
NYFRB as the federal funds effective rate.

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

“Financial Statements” has the meaning assigned to such term in Section 5.01.

“Funded Indebtedness” means, at any date, the aggregate principal amount of
total liabilities of the Borrower and its Subsidiaries on a consolidated basis,
minus the sum of (a) accounts payable arising from the purchase of goods and
services in the ordinary course of business, (b) accrued expenses or losses, and
(c) deferred revenues or gains, determined for the Borrower and its Subsidiaries
on a consolidated basis at such date, in accordance with GAAP.

“Funded Indebtedness to EBITDA Ratio” means, at any date, the ratio of (a)
Funded Indebtedness for such date to (b) EBITDA for the period of four fiscal
quarters ended on or most recently prior to such date.

“Funding Account” means the deposit account of the Borrower to which the Lender
is authorized by the Borrower to transfer the proceeds of any Loans requested or
authorized pursuant to this Agreement.

“GAAP” means generally accepted accounting principles in the U.S.

“Governmental Authority” means the government of the U.S., any other nation or
any political subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply

 

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funds for the purchase or payment of) such Indebtedness or other obligation or
to purchase (or to advance or supply funds for the purchase of) any security for
the payment thereof, (b) to purchase or lease property, securities or services
for the purpose of assuring the owner of such Indebtedness or other obligation
of the payment thereof, (c) to maintain working capital, equity capital or any
other financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness or other obligation or (d)
as an account party in respect of any letter of credit or letter of guaranty
issued to support such Indebtedness or obligation; provided that the term
Guarantee shall not include endorsements for collection or deposit in the
ordinary course of business.

“Hazardous Materials” means: (a) any substance, material, or waste that is
included within the definitions of “hazardous substances,” “hazardous
materials,” “hazardous waste,” “toxic substances,” “toxic materials,” “toxic
waste,” or words of similar import in any Environmental Law; (b) those
substances listed as hazardous substances by the United States Department of
Transportation (or any successor agency) (49 C.F.R. 172.101 and amendments
thereto) or by the Environmental Protection Agency (or any successor agency) (40
C.F.R. Part 302 and amendments thereto); and (c) any substance, material, or
waste that is petroleum, petroleum-related, or a petroleum by-product, asbestos
or asbestos-containing material, polychlorinated biphenyls, flammable,
explosive, radioactive, freon gas, radon, or a pesticide, herbicide, or any
other agricultural chemical.

“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, (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 letters of guaranty, (j) all obligations, contingent or
otherwise, of such Person in respect of bankers’ acceptances, (k) obligations
under any liquidated earn-out, (l) any other Off-Balance Sheet Liability and (m)
obligations, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Swap
Agreements, and (ii) any and all cancellations, buy backs, reversals,
terminations or assignments of any Swap Agreement transaction. 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.

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

“Indemnitee” has the meaning assigned to such term in Section 8.03(b).

“Information” has the meaning assigned to such term in Section 8.12.

“Intangible Assets” means the aggregate amount of: (a) all assets classified as
intangible assets under GAAP, including, without limitation, goodwill,
trademarks, patents, copyrights, organization

 

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expenses, franchises, licenses, trade names, brand names, mailing lists,
catalogs, excess of cost over book value of assets acquired, and bond discount
and underwriting expenses; and (b) loans or advances to, investments in, or
receivables from (i) any Affiliate of the Borrower or (ii) any Person if such
loan, advance, investment or receivable is outside the Borrower’s ordinary
course of business; and (c) prepaid expenses.

“Interest Expense” means, with reference to any period, total interest expense
(including that attributable to Capital Lease Obligations) of the Borrower and
its Subsidiaries for such period with respect to all outstanding Indebtedness of
the Borrower and its Subsidiaries (including all commissions, discounts and
other fees and charges owed with respect to letters of credit and bankers’
acceptances and net costs under Swap Agreements in respect of interest rates, to
the extent such net costs are allocable to such period in accordance with GAAP),
calculated for the Borrower and its Subsidiaries on a consolidated basis for
such period in accordance with GAAP.

“Interest Payment Date” means the first day of each calendar month.

“Interest Period” means each consecutive one (1) month period, the first of
which shall commence on the Effective Date, ending on the day which corresponds
numerically to such date one (1) month thereafter, provided, however, that if
there is no such numerically corresponding day in such first succeeding month,
such Interest Period shall end on the last Business Day of such first succeeding
month. If an Interest Period would otherwise end on a day which is not a
Business Day, such Interest Period shall end on the next succeeding Business
Day, provided, however, that if said next succeeding Business Day falls in a new
calendar month, such Interest Period shall end on the immediately preceding
Business Day.

“IRS” means the United States Internal Revenue Service.

“LC Collateral Account” has the meaning assigned to such term in Section
2.04(h).

“LC Disbursement” means any payment made by the Lender pursuant to a Letter of
Credit.

“LC Exposure” means, at any time, the sum of the Commercial LC Exposure and the
Standby LC Exposure at such time.

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

“Letters of Credit” means the letters of credit issued pursuant to this
Agreement, and the term “Letter of Credit” means any one of them or each of them
singularly, as the context may require.

“LIBO Rate” means, for any day and time, with respect to any Loan for any
Interest Period, the LIBO Screen Rate at approximately 11:00 a.m., London time,
two (2) Business Days prior to the commencement of such Interest Period;
provided that, if the LIBO Screen Rate shall not be available at such time for a
period equal in length to such Interest Period, then the applicable LIBO Rate
for the relevant Interest Period shall instead be the rate determined by the
Bank to be the rate at which the Bank offers to place U.S. dollar deposits
having a maturity equal to such Interest Period with first-class banks in the
London interbank market at approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period.

“LIBO Screen Rate” means, for any day and time, with respect to any Loan 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 Dollars) for a period equal in length to such Interest Period
as displayed on such day and time on pages LIBOR01 or LIBOR02 of the Reuters

 

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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); 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.

“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, collectively, this Agreement, each promissory note
issued pursuant to this Agreement, any Letter of Credit application and each
other agreement, instrument, document and certificate identified in Section 4.01
executed and delivered to, or in favor of, the Lender and including each other
pledge, power of attorney, consent, assignment, contract, notice, letter of
credit agreement, letter of credit application and each other written matter
whether heretofore, now or hereafter executed by or on behalf of the Borrower,
or any employee of the Borrower, and delivered to the Lender in connection with
the Prior Credit Agreement, this Agreement or the transactions contemplated
thereby or hereby. Any reference in this Agreement or any other Loan Document to
a Loan Document shall include all appendices, exhibits or schedules thereto, and
all amendments, restatements, supplements or other modifications thereto, and
shall refer to this Agreement or such Loan Document as the same may be in effect
at any and all times such reference becomes operative.

“Loans” means the loans made pursuant to Section 2.01(a).

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

“Material Indebtedness” means Indebtedness (other than the Loans and Letters of
Credit), or 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 $3,000,000. For purposes of determining Material Indebtedness, the
“principal amount” of the obligations of the Borrower or any Subsidiary in
respect of any Swap Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) that the Borrower or such Subsidiary
would be required to pay if such Swap Agreement were terminated at such time.

“Maturity Date” means September 30, 2019 (if the same is a Business Day, or if
not then the immediately next succeeding Business Day), or any earlier date on
which the Commitment is reduced to zero or otherwise terminated pursuant to the
terms hereof.

“Maximum Rate” has the meaning assigned to such term in Section 8.16.

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

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

 

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“Net Income” means, for any period, the consolidated net income (or loss)
determined for the Borrower and its Subsidiaries, on a consolidated basis in
accordance with GAAP; provided that there shall be excluded (a) the income (or
deficit) of any Person accrued prior to the date it becomes a Subsidiary or is
merged into or consolidated with the Borrower or any Subsidiary, and (b) the
income (or deficit) of any Person (other than a Subsidiary) in which the
Borrower or any Subsidiary has an ownership interest, except to the extent that
any such income is actually received by the Borrower or such Subsidiary in the
form of dividends or similar distributions.

“Net Worth” means total assets minus total liabilities.

“NYFRB” means the Federal Reserve Bank of New York.

“Obligated Party” has the meaning assigned to such term in Section 9.02.

“Obligations” means all unpaid principal of and accrued and unpaid interest on
the Loans, all LC Exposure, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations and indebtedness (including
interest and fees accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), obligations and liabilities of the Borrower to
the Lender or any indemnified party, individually or collectively, existing on
the Effective Date or arising thereafter, direct or indirect, joint or several,
absolute or contingent, matured or unmatured, liquidated or unliquidated,
secured or unsecured, arising by contract, operation of law or otherwise,
arising or incurred under this Agreement or any of the other Loan Documents or
in respect of any of the Loans made or reimbursement or other obligations
incurred or any of the Letters of Credit or other instruments at any time
evidencing any thereof.

“OFAC” means the Office of Foreign Assets Control of the United States
Department of the Treasury.

“Off-Balance Sheet Liability” of a Person means (a) any repurchase obligation or
liability of such Person with respect to accounts or notes receivable sold by
such Person, (b) any indebtedness, liability or obligation under any so-called
“synthetic lease” transaction entered into by such Person, or (c) any
indebtedness, liability or obligation arising with respect to any other
transaction which is the functional equivalent of or takes the place of
borrowing but which does not constitute a liability on the balance sheet of such
Person (other than operating leases).

“Other Connection Taxes” means, with respect to the Lender, Taxes imposed as a
result of a present or former connection between the Lender and the jurisdiction
imposing such Taxes (other than a connection arising from the Lender 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, Letter of Credit, or any Loan
Document.

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

“Parent” means, with respect to the Lender, the Person of which the Lender is,
directly or indirectly, a subsidiary.

 

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“Participant” has the meaning assigned to such term in Section 8.04(c).

“Participant Register” has the meaning assigned to such term in Section 8.04(c).

“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 thirty (30) days or are
being contested in compliance with Section 5.04;

(c) pledges and deposits made in the ordinary course of business in compliance
with workers’ compensation, unemployment insurance and other social security
laws or regulations;

(d) 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 Article VII; and

(f) easements, zoning restrictions, rights-of-way 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;

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness, except with respect to clause (e) 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.

“Prime Rate” means the rate of interest per annum publicly announced from time
to time by the Lender as its prime rate in effect at its principal offices 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 Credit Agreement” means that certain Credit Agreement dated as of May 20,
2010 between the Lender and the Borrower, as amended or modified from time to
time.

“Refinance Indebtedness” has the meaning assigned to such term in
Section 6.01(d).

 

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

“Release” means any releasing, spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, migrating, disposing, or
dumping of any substance into the environment.

“Report” means reports prepared by the Lender or another Person showing the
results of appraisals, field examinations or audits pertaining to the Borrower’s
assets from information furnished by or on behalf of the Borrower, after the
Lender has exercised its rights of inspection pursuant to this Agreement.

“Requirement of Law” means, with respect to any Person, (a) the charter,
articles or certificate of organization or incorporation and bylaws or
operating, management or partnership agreement, or other organizational or
governing documents of such Person and (b) any statute, law (including common
law), treaty, rule, regulation, code, ordinance, order, decree, writ, judgment,
injunction or determination of any arbitrator or court or other Governmental
Authority (including Environmental Laws), in each case applicable to or binding
upon such Person or any of its property or to which such Person or any of its
property is subject.

“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 or any option, warrant or other right to acquire any
such Equity Interests.

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

“Sale and Leaseback Transaction” has the meaning assigned to such term in
Section 6.06.

“Sanctioned Country” means, at any time, a country, region or territory which is
the subject or target of any Sanctions ( at the time of this Agreement, Crimea,
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 or the U.S. Department of
State, or by the United Nations Security Council, the European Union, any
European Union member state, Her Majesty’s Treasury of the United Kingdom or
other relevant sanctions authority, (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 all economic or financial sanctions or trade embargoes
imposed, administered or enforced from time to time by (a) 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, or (b) the United
Nations Security Council, the European Union, any European Union member state or
Her Majesty’s Treasury of the United Kingdom or other relevant sanctions
authority.

“SEC” means the Securities and Exchange Commission of the U.S.

 

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“Standby LC Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all standby Letters of Credit outstanding at such time plus (b) the
aggregate amount of all LC Disbursements relating to standby Letters of Credit
that have not yet been reimbursed by or on behalf of the Borrower at such time.

“Statement” has the meaning assigned to such term in Section 2.16(d).

“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) established by the Board
to which the Lender is subject with respect to the Adjusted LIBO Rate, for
eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such Regulation D 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 the 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 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
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 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 direct or indirect subsidiary of the Borrower.

“Swap Agreement” means any agreement with respect to any swap, forward, spot,
future, credit default or derivative transaction or any option or similar
agreement involving, or settled by reference to, one or more rates, currencies,
commodities, equity or debt instruments or securities, or economic, financial or
pricing indices or measures of economic, financial or pricing risk or value or
any similar transaction or any combination of these transactions; provided that
no phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of the Borrower or the Subsidiaries shall be a Swap Agreement.

“Swap Agreement Obligations” means any and all obligations of the Borrower,
whether absolute or contingent and howsoever and whensoever created, arising,
evidenced or acquired (including all renewals, extensions and modifications
thereof and substitutions therefor), under (a) any Swap Agreement permitted
hereunder with the Lender or an Affiliate of the Lender, and (b) any
cancellations, buy backs, reversals, terminations or assignments of any Swap
Agreement transaction permitted hereunder with the Lender or an Affiliate of the
Lender.

“Tangible Assets” means total assets excluding Intangible Assets.

“Tangible Net Worth” means total assets less the sum of Intangible Assets and
Total Indebtedness.

 

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

“Total Indebtedness” means, at any date, the aggregate principal amount of all
Indebtedness determined for the Borrower and its Subsidiaries on a consolidated
basis at such date, in accordance with GAAP.

“Transactions” means the execution, delivery and performance by the Borrower of
this Agreement and the other Loan Documents, the borrowing of Loans and other
credit extensions, the use of the proceeds thereof and the issuance of Letters
of Credit hereunder.

“UCC” means the Uniform Commercial Code as in effect from time to time in the
State of Michigan or in any other state, the laws of which are required to be
applied in connection with the issue of perfection of security interests.

“Unfinanced Capital Expenditures” means, for any period, Capital Expenditures
made during such period which are not financed from the proceeds of any
Indebtedness (other than the Loans; it being understood and agreed that, to the
extent any Capital Expenditures are financed with Loans, such Capital
Expenditures shall be deemed Unfinanced Capital Expenditures).

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

“USA PATRIOT Act” means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001.

“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. [intentionally omitted].

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 “law”
shall be construed as referring to all statutes, rules, regulations, codes and
other laws (including official rulings and interpretations thereunder having the
force of law or with which affected Persons customarily comply) and all
judgments, orders and decrees of all Governmental Authorities. 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 modifications
set forth herein), (b) any definition of or reference to any statute, rule or
regulation shall be construed as referring thereto as from time to time amended,
supplemented or otherwise modified (including by succession of comparable
successor laws), (c) any reference herein to any Person shall be construed to
include such Person’s successors and assigns (subject to any restrictions on
assignments set forth herein) and, in the case of any Governmental Authority,
any other Governmental Authority that shall have succeeded to any or all
functions thereof, (d) the words “herein”, “hereof” and “hereunder”, and words
of similar import, shall be construed to refer to this

 

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Agreement in its entirety and not to any particular provision hereof, (e) 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, (f) any reference in any definition to the phrase “at any time”
or “for any period” shall refer to the same time or period for all calculations
or determinations within such definition, and (g) the words “asset” and
“property” shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.

SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided that, if after
the date hereof there occurs any change in GAAP or in the application thereof on
the operation of any provision hereof and the Borrower notifies the Lender that
the Borrower requests an amendment to any provision hereof to eliminate the
effect of such change in GAAP or in the application thereof (or if the Lender
notifies the Borrower that the Lender requests an amendment to any provision
hereof for such purpose), regardless of whether any such notice is given before
or after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.

SECTION 1.05. Pro Forma Adjustments for Acquisitions and Dispositions. To the
extent the Borrower or any Subsidiary makes any Acquisition permitted pursuant
to Section 6.04 or disposition of assets outside the ordinary course of business
permitted by Section 6.05 during the period of four fiscal quarters of the
Borrower most recently ended, the Funded Indebtedness to EBITDA Ratio shall be
calculated after giving pro forma effect thereto (including pro forma
adjustments arising out of events which are directly attributable to the
acquisition or the disposition of assets, are factually supportable and are
expected to have a continuing impact, in each case as determined on a basis
consistent with Article 11 of Regulation S-X of the Securities Act of 1933, as
amended, as interpreted by the SEC, and as certified by a Financial Officer), as
if such acquisition or such disposition (and any related incurrence, repayment
or assumption of Indebtedness) had occurred on the first day of such
four-quarter period.

SECTION 1.06. Rounding. Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).

ARTICLE II

The Credit

SECTION 2.01. Commitment. Subject to the terms and conditions set forth herein,
the Lender agrees to make Loans in dollars to the Borrower from time to time
during the Availability Period in an aggregate principal amount that will not
result in the Exposure exceeding the Commitment. Within the foregoing limits and
subject to the terms and conditions set forth herein, the Borrower may borrow,
prepay and reborrow Loans. The Lender at its option may make any Loan by causing
any domestic or foreign branch or Affiliate of the Lender to make such Loan (and
in the case of an Affiliate, the provisions of Sections 2.12, 2.13, 2.14 and
2.15 shall apply to such Affiliate to the same extent as to the Lender);
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.

 

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SECTION 2.02. [intentionally omitted].

SECTION 2.03. Borrowing Procedures; Requests for Loans. To request a Loan, the
Borrower shall notify the Lender of such request either in writing (delivered by
hand or fax) in a form approved by the Lender and signed by the Borrower or by
telephone or through Electronic System, if arrangements for doing so have been
approved by the Lender, not later than noon, Detroit, Michigan time, on the date
of the proposed Loan; provided that any such notice of a Loan to finance the
reimbursement of an LC Disbursement as contemplated by Section 2.04(d) may be
given not later than 9:00 a.m., Detroit, Michigan time, on the date of the
proposed Loan. Each such telephonic request shall be irrevocable and shall be
confirmed promptly by hand delivery, fax or a communication through Electronic
System to the Lender of a written Loan request in a form approved by the Lender
and signed by the Borrower. Each such telephonic and written Loan request shall
specify the following information in compliance with Section 2.01:

 

  (i) the amount of the requested Loan and a breakdown of the separate
disbursements comprising such Loan; and

 

  (ii) the date of such Loan, which shall be a Business Day;

SECTION 2.04. Letters of Credit.

(a) General. Subject to the terms and conditions set forth herein, the Borrower
may request the issuance of Letters of Credit denominated in dollars as the
applicant thereof for the support of its or its Subsidiaries’ obligations, in a
form reasonably acceptable to the Lender, at any time and from time to time
during the Availability Period. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, the Lender relating to any Letter of
Credit, the terms and conditions of this Agreement shall control. The Borrower
unconditionally and irrevocably agrees that, in connection with any Letter of
Credit issued for the support of any Subsidiary’s obligations as provided in the
first sentence of this paragraph, the Borrower will be fully responsible for the
reimbursement of LC Disbursements in accordance with the terms hereof, the
payment of interest thereon and the payment of fees due under Section 2.10(b) to
the same extent as if it were the sole account party in respect of such Letter
of Credit (the Borrower hereby irrevocably waiving any defenses that might
otherwise be available to it as a guarantor or surety of the obligations of such
Subsidiary that is an account party in respect of any such Letter of
Credit). Notwithstanding anything herein to the contrary, the Lender shall have
no obligation hereunder to issue, and shall not issue, any Letter of Credit (i)
the proceeds of which would be made available to any Person (A) to fund any
activity or business of or with any Sanctioned Person, or in any country or
territory that, at the time of such funding, is the subject of any Sanctions or
(B) in any manner that would result in a violation of any Sanctions by any party
to this Agreement, (ii) if any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or restrain the
Lender from issuing such Letter of Credit, or any Requirement of Law relating to
the Lender or any request or directive (whether or not having the force of law)
from any Governmental Authority with jurisdiction over the Lender shall
prohibit, or request that the Lender refrain from, the issuance of letters of
credit generally or such Letter of Credit in particular or shall impose upon the
Lender with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which the Lender is not otherwise compensated hereunder) not in
effect on the Effective Date, or shall impose upon the Lender any unreimbursed
loss, cost or expense which was not applicable on the Effective Date and which
the Lender in good faith deems material to it, or (iii) if the issuance of such
Letter of Credit would violate one or more policies of the Lender applicable to
letters of credit generally; provided that, notwithstanding anything herein to
the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act
and all requests, rules,

 

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guidelines, requirements or directives thereunder or issued in connection
therewith or in the implementation thereof, and (y) all requests, rules,
guidelines, requirements or directives promulgated by the Bank for International
Settlements, the Basel Committee on Banking Supervision (or any successor or
similar authority) or the United States or foreign regulatory authorities, in
each case pursuant to Basel III, shall in each case be deemed not to be in
effect on the Effective Date for purposes of clause (ii) above, regardless of
the date enacted, adopted, issued or implemented.

(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), the Borrower shall hand deliver
or fax (or transmit through Electronic System, if arrangements for doing so have
been approved by the Lender) to the Lender (reasonably in advance of the
requested date of issuance, amendment, renewal or extension, but in any event no
less than three (3) Business Days) a notice requesting the issuance of a Letter
of Credit, or identifying the Letter of Credit to be amended, renewed or
extended, and specifying the date of issuance, amendment, renewal or extension
(which shall be a Business Day), the date on which such Letter of Credit is to
expire (which shall comply with paragraph (c) of this Section), the amount of
such Letter of Credit, the name and address of the beneficiary thereof, and such
other information as shall be necessary to prepare, amend, renew or extend such
Letter of Credit. If requested by the Lender, the Borrower also shall submit a
letter of credit application on the Lender’s standard form in connection with
any request for a Letter of Credit. A Letter of Credit shall be issued, amended,
renewed or extended only if (and upon issuance, amendment, renewal or extension
of each Letter of Credit the Borrower shall be deemed to represent and warrant
that), after giving effect to such issuance, amendment, renewal or extension
(i) the LC Exposure shall not exceed $2,000,000 and (ii) the Exposure shall not
exceed the Commitment.

(c) Expiration Date. Each Letter of Credit shall expire (or be subject to
termination or non-renewal by notice from the Lender to the beneficiary thereof)
at or prior to the close of business on the earlier of (i) the date one year
after the date of the issuance of such Letter of Credit (or, in the case of any
renewal or extension thereof, including, without limitation, any automatic
renewal provision, one year after such renewal or extension) and (ii) the date
that is five Business Days prior to the Maturity Date.

(d) Reimbursement. If the Lender shall make any LC Disbursement in respect of a
Letter of Credit, the Borrower shall reimburse such LC Disbursement by paying to
the Lender an amount equal to such LC Disbursement not later than 11:00 a.m.,
Detroit, Michigan time, on (i) the Business Day that the Borrower receives
notice of such LC Disbursement, if such notice is received prior to 9:00 a.m.,
Detroit, Michigan time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrower receives such notice, if such
notice is received after 9:00 a.m., Detroit, Michigan time, on the day of
receipt; provided that the Borrower may, subject to the conditions to borrowing
set forth herein, request in accordance with Section 2.03 or 2.05 that such
payment be financed with a Loan in an equivalent amount and, to the extent so
financed, the Borrower’s obligation to make such payment shall be discharged and
replaced by the resulting Loan.

(e) Obligations Absolute. The Borrower’s obligation to reimburse LC
Disbursements as provided in paragraph (d) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of any (i) lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein or herein, (ii) draft
or other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Lender under a Letter of Credit
against presentation of a draft or other document that does not comply with the
terms of such Letter of Credit, or (iv) other event or circumstance whatsoever,
whether or not similar to any of the

 

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foregoing, that might, but for the provisions of this Section, constitute a
legal or equitable discharge of, or provide a right of setoff against, the
Borrower’s obligations hereunder. Neither the Lender nor any of its Related
Parties, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit, any payment or
failure to make any payment thereunder (irrespective of any of the circumstances
referred to in the preceding sentence), or any error, omission, interruption,
loss or delay in transmission or delivery of any draft, notice or other
communication under or relating to any Letter of Credit (including any document
required to make a drawing thereunder), any error in interpretation of technical
terms or any consequence arising from causes beyond the control of the Lender;
provided that the foregoing shall not be construed to excuse the Lender from
liability to the Borrower to the extent of any direct damages (as opposed to
special, indirect, consequential or punitive damages, claims in respect of which
are hereby waived by the Borrower to the extent permitted by applicable law)
suffered by the Borrower that are caused by the Lender’s failure to exercise
care when determining whether drafts and other documents presented under a
Letter of Credit comply with the terms thereof. The parties hereto expressly
agree that, in the absence of gross negligence or willful misconduct on the part
of the Lender (as finally determined by a court of competent jurisdiction), the
Lender shall be deemed to have exercised care in each such determination. In
furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
Lender may, in its sole discretion, either accept and make payment upon such
documents without responsibility for further investigation, regardless of any
notice or information to the contrary, or refuse to accept and make payment upon
such documents if such documents are not in strict compliance with the terms of
such Letter of Credit.

(f) Disbursement Procedures. The Lender shall, promptly following its receipt
thereof, examine all documents purporting to represent a demand for payment
under a Letter of Credit. The Lender shall promptly notify the Borrower by
telephone (confirmed by fax) of such demand for payment and whether the Lender
has made or will make an LC Disbursement thereunder; provided that any failure
to give or delay in giving such notice shall not relieve the Borrower of its
obligation to reimburse the Lender with respect to any such LC Disbursement.

(g) Interim Interest. If the Lender shall make any LC Disbursement, then, unless
the Borrower shall reimburse such LC Disbursement in full on the date such LC
Disbursement is made, the unpaid amount thereof shall bear interest, for each
day from and including the date such LC Disbursement is made to but excluding
the date that the Borrower reimburses such LC Disbursement, at the rate per
annum then applicable to Loans and such interest shall be due and payable on the
date when such reimbursement is due; provided that, if the Borrower fails to
reimburse such LC Disbursement when due pursuant to paragraph (d) of this
Section, then Section 2.11(c) shall apply. Interest accrued pursuant to this
paragraph shall be for the account of the Lender.

(h) Cash Collateralization. If any Default shall occur and be continuing, on the
Business Day that the Borrower receives notice from the Lender demanding the
deposit of cash collateral pursuant to this paragraph, the Borrower shall
deposit in an account with the Lender, in the name and for the benefit of the
Lender (the “LC Collateral Account”), an amount in cash equal to 102% of the
amount of the LC Exposure as of such date plus accrued and unpaid interest
thereon; provided that the obligation to deposit such cash collateral shall
become effective immediately, and such deposit shall become immediately due and
payable, without demand or other notice of any kind, upon the occurrence of any
Event of Default with respect to the Borrower described in clause (h) or (i) of
Article VII. The Borrower also shall deposit cash collateral in accordance with
this paragraph as and to the extent required by Section 2.09(b). Each such
deposit shall be held by the Lender as collateral for the payment and
performance of the Obligations, Banking Services Obligations and Swap Agreement
Obligations. The Lender shall have exclusive dominion and control, including the
exclusive right of withdrawal, over the

 

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LC Collateral Account and the Borrower hereby grants the Lender a security
interest in the LC Collateral Account and all moneys or other assets on deposit
therein or credited thereto. Other than any interest earned on the investment of
such deposits, which investments shall be made at the option and sole discretion
of the Lender and at the Borrower’s risk and expense, such deposits shall not
bear interest. Interest or profits, if any, on such investments shall accumulate
in such account. Moneys in such account shall be applied by the Lender for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrower for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated, be applied to satisfy other Obligations, Banking Services
Obligations or Swap Agreement Obligations. If the Borrower is required to
provide an amount of cash collateral hereunder as a result of the occurrence of
a Default, such amount (to the extent not applied as aforesaid) shall be
returned to the Borrower within three (3) Business Days after all such
Default[s] have been cured or waived as confirmed in writing by the Lender.

(i) LC Exposure Determination. For all purposes of this Agreement, the amount of
a Letter of Credit that, by its terms or the terms of any document related
thereto, provides for one or more automatic increases in the stated amount
thereof shall be deemed to be the maximum stated amount of such Letter of Credit
after giving effect to all such increases, whether or not such maximum stated
amount is in effect at the time of determination.

SECTION 2.05. Funding of Borrowings. The Lender shall make each Loan to be made
by it hereunder on the proposed date thereof available to the Borrower by
promptly crediting the amounts in immediately available funds, to the Funding
Account; provided that Loans made to finance the reimbursement of an LC
Disbursement as provided in Section 2.04(d) shall be remitted to the Lender.

SECTION 2.06. [intentionally omitted].

SECTION 2.07. Termination of Commitment.

(a) Unless previously terminated, the Commitment shall terminate on the Maturity
Date.

(b) The Borrower may at any time terminate the Commitment upon (i) the payment
in full of all outstanding Loans and LC Disbursements, together with accrued and
unpaid interest thereon, (ii) the cancellation and return of all outstanding
Letters of Credit (or alternatively, with respect to each such Letter of Credit,
the furnishing to the Lender of a cash deposit (or at the discretion of the
Lender a backup standby letter of credit satisfactory to the Lender) in an
amount equal to 102% of the LC Exposure as of such date), (iii) the payment in
full of the accrued and unpaid fees (if any), and (iv) the payment in full of
all reimbursable expenses and other Obligations together with accrued and unpaid
interest thereon.

(c) The Borrower shall notify the Lender of any election to terminate the
Commitment under paragraph (b) of this Section at least three (3) Business Days
prior to the effective date of such termination, specifying such election and
the effective date thereof. Each notice delivered by the Borrower pursuant to
this Section shall be irrevocable; provided that a notice of termination of the
Commitment delivered by the Borrower may state that such notice is conditioned
upon the effectiveness of other credit facilities, in which case such notice may
be revoked by the Borrower (by notice to the Lender on or prior to the specified
effective date) if such condition is not satisfied. Any termination of the
Commitment shall be permanent.

SECTION 2.08. Repayment of Loans; Evidence of Debt.

(a) The Borrower hereby unconditionally promises to pay the Lender the then
unpaid principal amount of each Loan on the Maturity Date.

 

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

(c) The entries made in the accounts maintained pursuant to paragraph (b) of
this Section shall be prima facie evidence of the existence and amounts of the
obligations recorded therein; provided that the failure of the Lender 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.

(d) The Lender may request that Loans made by it be evidenced by a promissory
note. In such event, the Borrower shall prepare, execute and deliver to the
Lender a promissory note payable to the Lender (or, if requested by the Lender,
to the Lender and its registered assigns) and in a form reasonably acceptable to
the Lender. Thereafter, the Loans evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to Section 8.04)
be represented by one or more promissory notes in such form.

SECTION 2.09. Prepayment of Loans.

(a) The Borrower shall have the right at any time and from time to time to
prepay any Loans in whole or in part.

(b) In the event and on such occasion that the Exposure exceeds the Commitment,
the Borrower shall prepay the Loans and/or LC Exposure (or, if no Loans are
outstanding, deposit cash collateral in the LC Collateral Account in an
aggregate amount equal to such excess, in accordance with Section 2.04(h)).

SECTION 2.10. Fees.

(a) The Borrower agrees to pay (i) to the Lender a letter of credit fee with
respect to Letters of Credit, which shall accrue at the rate of 1.00% per annum
on the daily amount of the Lender’s LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the date on which the
Lender’s Commitment terminates and the date on which the Lender ceases to have
any LC Exposure, and (ii) the Lender’s standard fees and commissions with
respect to the issuance, amendment, cancellation, negotiation, transfer,
presentment, renewal or extension of any Letter of Credit or processing of
drawings thereunder. Letter of credit fees accrued through and including the
last day of March, June, September and December of each year shall be payable on
the third Business Day following such last day, commencing on the first such
date to occur after the Effective Date; provided that all such fees shall be
payable on the date on which the Commitment terminates and any such fees
accruing after the date on which the Commitment terminates shall be payable on
demand. Any other fees payable to the Lender pursuant to this paragraph shall be
payable within ten (10) Business Days after demand. All letter of credit fees
shall be computed on the basis of a year of 360 days and shall be payable for
the actual number of days elapsed (including the first day but excluding the
last day).

(b) All fees payable hereunder shall be paid on the dates due, in immediately
available funds, to the Lender. Fees paid shall not be refundable under any
circumstances.

SECTION 2.11. Interest.

 

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(a) The Loans shall bear interest at the Adjusted LIBO Rate plus the Applicable
Rate.

(b) Notwithstanding the foregoing, during the occurrence and continuance of a
Default, the Lender may, at its option, by notice to the Borrower, declare that
(i) all Loans shall bear interest at 2% plus the rate otherwise applicable to
such Loans as provided in the preceding paragraph of this Section or (ii) in the
case of any other amount outstanding hereunder (other than interest), such
amount shall accrue at 2% plus the rate applicable to such fee or other
obligation as provided hereunder.

(c) Accrued interest on each Loan shall be payable in arrears on each Interest
Payment Date and upon termination of the Commitment; provided that (i) interest
accrued pursuant to paragraph (b) of this Section shall be payable on demand.

(d) All interest hereunder shall be computed on the basis of a year of 360 days
and shall be payable for the actual number of days elapsed (including the first
day but excluding the last day). The Adjusted LIBO Rate shall be determined by
the Lender, and such determination shall be conclusive absent manifest error.

SECTION 2.12. Inability to Determine Interest Rate; Inadequacy. If:

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

(b) the Lender determines the Adjusted LIBO Rate or the LIBO Rate, as
applicable, will not adequately and fairly reflect the cost to the Lender of
making or maintaining any Loan;

then the Lender shall give notice thereof to the Borrower by telephone, fax or
through Electronic System as provided in Section 8.01 as promptly as practicable
thereafter and (i) the obligation of the Bank to make Loans shall be suspended
until the Bank notifies the Borrower that the circumstances giving rise to the
suspension no longer exist and (ii) the outstanding principal amount of the
Loans, together with accrued interest and any other amounts payable to the Bank
under this Agreement or the other Loan Documents, shall be repaid on the last
day of the then current Interest Period applicable to the Loans.

SECTION 2.13. Increased Costs. (a) 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, the Lender (except any such reserve requirement reflected in
the Adjusted LIBO Rate); or

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

(iii) subject the Lender 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 the
Lender of making, continuing, converting into or maintaining any Loan (or of
maintaining its obligation to make any such Loan) or to

 

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increase the cost to the Lender of issuing or maintaining any Letter of Credit
or to reduce the amount of any sum received or receivable by the Lender
hereunder (whether of principal, interest or otherwise), then the Borrower will
pay to the Lender such additional amount or amounts as will compensate the
Lender for such additional costs incurred or reduction suffered.

(b) If the 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 the Lender’s capital or on the capital of the Lender’s holding company
as a consequence of this Agreement, the Commitment, the Loans made by the Lender
or the Letters of Credit issued by the Lender to a level below that which the
Lender or the Lender’s holding company could have achieved but for such Change
in Law (taking into consideration the Lender’s policies and the policies of the
Lender’s holding company with respect to capital adequacy and liquidity), then
from time to time the Borrower will pay to the Lender such additional amount or
amounts as will compensate the Lender or the Lender’s holding company for any
such reduction suffered.

(c) A certificate of the Lender setting forth the amount or amounts necessary to
compensate the 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 the Lender the
amount shown as due on any such certificate within ten (10) Business Days after
receipt thereof.

(d) Failure or delay on the part of the Lender to demand compensation pursuant
to this Section shall not constitute a waiver of the Lender’s right to demand
such compensation; provided that the Borrower shall not be required to
compensate the Lender pursuant to this Section for any increased costs or
reductions incurred more than 180 days prior to the date that the Lender
notifies the Borrower of the Change in Law giving rise to such increased costs
or reductions and of the 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 180-day period referred to above shall be
extended to include the period of retroactive effect thereof.

SECTION 2.14. Illegality. If any Change in Law shall make it unlawful or
impossible for the Lender to maintain or fund Loans, then, upon notice to the
Borrower by the Lender, the outstanding principal amount of the Loans, together
with accrued interest and any other amounts payable to the Lender under this
Agreement or the other Loan Documents on account of the Loans shall be repaid
(a) immediately upon the Lender’s demand if such Change in Law, in the Lender’s
judgment, requires immediate repayment, or (b) at the expiration of the last
Interest Period to expire before the effective date of any such Change in Law.

SECTION 2.15. Taxes.

(a) Withholding Taxes; Gross-Up; 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 2.15), the Lender receives an amount equal to the sum
it would have received had no such deduction or withholding been made.

 

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

(c) Evidence of Payment. As soon as practicable after any payment of Taxes by
the Borrower to a Governmental Authority pursuant to this Section 2.15, the
Borrower shall deliver to the Lender 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 Lender.

(d) Indemnification by the Borrower. The Borrower shall indemnify the Lender,
within ten (10) Business 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 the
Lender or required to be withheld or deducted from a payment to the Lender 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 the Lender shall be conclusive absent
manifest error.

(e) Treatment of Certain Refunds. If the Lender 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 2.15 (including by
the payment of additional amounts pursuant to this Section 2.15), 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 2.15 with respect to the Taxes
giving rise to such refund), net of all out-of-pocket expenses (including Taxes)
of the Lender 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 the Lender, shall repay to the Lender the amount paid to the
Lender (plus any penalties, interest or other charges imposed by the relevant
Governmental Authority) in the event the Lender is required to repay such refund
to such Governmental Authority. Notwithstanding anything to the contrary in this
paragraph (e), in no event will the Lender be required to pay any amount to any
indemnifying party pursuant to this paragraph (e), the payment of which would
place the Lender in a less favorable net after-Tax position than the Lender
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 giving rise to such refund had
never been paid. This paragraph (e) shall not be construed to require the Lender
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.

(f) Survival. Each party’s obligations under this Section 2.15 shall survive the
resignation or replacement of the Lender or any assignment of rights by, or the
replacement of, the Lender, the termination of the Commitment and the repayment,
satisfaction or discharge of all obligations under any Loan Document.

(g) Defined Terms. For purposes of this Section 2.15, the term “applicable law”
includes FATCA.

SECTION 2.16. Payments Generally; Allocation of Proceeds.

(a) The Borrower shall make each payment required to be made by it hereunder
(whether of principal, interest, fees or reimbursement of LC Disbursements, or
of amounts payable under Sections 2.13, 2.14 or 2.15, or otherwise) prior to
2:00 p.m., Detroit, Michigan time, on the date when due, in immediately
available funds, without set-off or counterclaim. Any amounts received after
such

 

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time on any date may, in the discretion of the Lender, 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 Lender at its office
designated by the Lender from time to time. Unless otherwise provided for
herein, if any payment hereunder shall be due on a day that is not a Business
Day, the date for payment shall be extended to the next succeeding Business Day,
and, in the case of any payment accruing interest, interest thereon shall be
payable for the period of such extension. All payments hereunder shall be made
in dollars.

(b) At the election of the Lender, all payments of principal, interest, LC
Disbursements, fees, premiums, reimbursable expenses (including, without
limitation, all reimbursement for fees, costs and expenses pursuant to Section
8.03), and other sums due and payable under the Loan Documents, may be paid from
the proceeds of Loans made hereunder, whether made following a request by the
Borrower pursuant to Section 2.03 or a deemed request as provided in this
Section or, when any Default has occurred and is continuing, may be deducted
from any deposit account of the Borrower maintained with the Lender. The
Borrower hereby irrevocably authorizes (i) the Lender to make a Loan for the
purpose of paying each payment of principal, interest and fees that has become
due hereunder and is unpaid or any other amount that has become due and is
unpaid under the Loan Documents and agrees that all such amounts charged shall
constitute Loans, and that all such Loans shall be deemed to have been requested
pursuant to Sections 2.03 and (ii) when the payment has become due and is unpaid
or any Default has occurred and is continuing, the Lender to charge any deposit
account of the Borrower maintained with the Lender for each payment of
principal, interest and fees due hereunder or any other amount due under the
Loan Documents. Without limitation of the foregoing, to effectuate any payment
due under this Agreement or under any other Loan Documents, the Borrower hereby
authorizes the Lender to initiate debit entries to Account Number 829459171 at
the Lender and to debit the same to such account. This authorization to initiate
debit entries shall remain in full force and effect until the Lender has
received written notification of its termination in such time and in such manner
as to afford the Lender a reasonable opportunity to act on it. The Borrower
represents that the Borrower is and will be the owner of all funds in such
account. The Borrower acknowledges: (1) that such debit entries may cause an
overdraft of such account which may result in the Lender’s refusal to honor
items drawn on such account until adequate deposits are made to such account;
(2) that the Lender is under no duty or obligation to initiate any debit entry
for any purpose; and (3) that if a debit is not made because the
above-referenced account does not have a sufficient available balance, or
otherwise, the payment may be late or past due.

(c) The Lender may from time to time provide the Borrower with account
statements or invoices with respect to any of the Obligations (the
“Statements”). The Lender is under no duty or obligation to provide Statements,
which, if provided, will be solely for the Borrower’s convenience. Statements
may contain estimates of the amounts owed during the relevant billing period,
whether of principal, interest, fees or other Obligations. If the Borrower pays
the full amount indicated on a Statement on or before the due date indicated on
such Statement, the Borrower shall not be in default of payment with respect to
the billing period indicated on such Statement; provided, that acceptance by the
Lender of any payment that is less than the total amount actually due at that
time (including but not limited to any past due amounts) shall not constitute a
waiver of the Lender’s right to receive payment in full at another time.

SECTION 2.17. Indemnity for Returned Payments. If after receipt of any payment
which is applied to the payment of all or any part of the Obligations (including
a payment effected through exercise of a right of setoff), the Lender is for any
reason compelled to surrender such payment or proceeds to any Person because
such payment or application of proceeds is invalidated, declared fraudulent, set
aside, determined to be void or voidable as a preference, impermissible setoff,
or a diversion of trust funds, or for any other reason (including pursuant to
any settlement entered into by the Lender in its discretion), then the
Obligations or part thereof intended to be satisfied shall be revived and

 

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continued and this Agreement shall continue in full force as if such payment or
proceeds had not been received by the Lender. The provisions of this Section
2.17 shall be and remain effective notwithstanding any contrary action which may
have been taken by the Lender in reliance upon such payment or application of
proceeds. The provisions of this Section 2.17 shall survive the termination of
this Agreement.

ARTICLE III

Representations and Warranties

The Borrower represents and warrants to the Lender that (and where applicable,
agrees):

SECTION 3.01. Organization; Powers. The Borrower and each Subsidiary is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, has all requisite power and authority to carry
on its business as now conducted and, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect, is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required.

SECTION 3.02. Authorization; Enforceability. The Transactions are within the
Borrower’s organizational powers and have been duly authorized by all necessary
organizational actions and, if required, actions by equity holders. Each Loan
Document has been duly executed and delivered by the Borrower and constitutes a
legal, valid and binding obligation of the Borrower, enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law.

SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except such as have been obtained or made
and are in full force and effect and except for filings necessary to perfect
Liens created pursuant to the Loan Documents, (b) will not violate any
Requirement of Law applicable to the Borrower or any Subsidiary, (c) will not
violate or result in a default under any indenture, agreement or other
instrument binding upon any the Borrower or any Subsidiary or the assets of the
Borrower or any Subsidiary, or give rise to a right thereunder to require any
payment to be made by the Borrower or any Subsidiary, except where such
violation or default or required payment, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect, and (d)
will not result in the creation or imposition of any Lien on any asset of the
Borrower or any Subsidiary, except Liens created pursuant to the Loan Documents.

SECTION 3.04. Financial Condition; No Material Adverse Change.

(a) The Borrower has heretofore furnished to the Lender its consolidated balance
sheet and statements of income, stockholders equity and cash flows as of and for
the fiscal year ended May 31, 2016, reported on by BDO USA, LLP, independent
public accountants. 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.

(b) No event, change or condition has occurred that has had, or could reasonably
be expected to have, a Material Adverse Effect, since May 31, 2016.

 

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SECTION 3.05. Properties.

(a) Each of the Borrower and each Subsidiary has good and indefeasible title to,
or valid leasehold interests in, all of its real and personal property, free of
all Liens other than those permitted by Section 6.02.

(b) Except where failure of any of the following, individually or in the
aggregate, to be true could not reasonably be expected to result in a Material
Adverse Effect, (i) each of the Borrower and each Subsidiary owns, or is
licensed to use, all trademarks, tradenames, copyrights, patents and other
intellectual property necessary to its business as currently conducted, (ii) the
use thereof by each of the Borrower and each Subsidiary does not infringe in any
material respect upon the rights of any other Person, and (iii) each of the
Borrower’s and each Subsidiary’s rights thereto are not subject to any licensing
agreement or similar arrangement.

SECTION 3.06. Litigation and Environmental Matters.

(a) There are no actions, suits or proceedings by or before any arbitrator or
Governmental Authority pending against or, to the knowledge of the Borrower,
threatened against or affecting the Borrower or any Subsidiary (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 or (ii) that involve any Loan
Document or the Transactions.

(b) (i) Except as reasonably promptly from time to time disclosed to the Lender,
neither the Borrower nor any Subsidiary has received notice of any claim with
respect to any Environmental Liability or knows of any basis for any
Environmental Liability and (ii) 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 Subsidiary
(A) 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 (B) has become subject to any Environmental Liability, (C) has
received notice of any claim with respect to any Environmental Liability or (D)
knows of any basis for any Environmental Liability.

SECTION 3.07. Compliance with Laws and Agreements; No Default. Except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, each of the Borrower and each
Subsidiary is in compliance with (i) all Requirements of Law applicable to it or
its property and (ii) all indentures, agreements and other instruments binding
upon it or its property. No Default has occurred and is continuing.

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

SECTION 3.09. Taxes. Each of the Borrower and each Subsidiary 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. Except (i) as reasonably promptly from time to time disclosed to the
Lender or (ii) tax liens and claims that, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect, no tax
liens have been filed and no claims are being asserted with respect to any such
taxes.

 

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SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably expected to
occur that, when taken together with all other such ERISA Events for which
liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (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 the fair
market value of the assets of such Plan.

SECTION 3.11. Disclosure. The Borrower has disclosed to the Lender all
agreements, instruments and corporate or other restrictions to which the
Borrower or any Subsidiary is subject, and all other matters known to it, 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 the Borrower or any Subsidiary
to the Lender in connection with the negotiation of this Agreement or any other
Loan Document (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
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 delivered and, if such projected financial information
was delivered prior to the Effective Date, as of the Effective Date.

SECTION 3.12. Material Agreements. Neither the Borrower nor any Subsidiary is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in (i) any agreement to which it is a party
where such default could reasonably be expected to result in a Material Adverse
Effect or (ii) any agreements or instruments evidencing or governing in the
aggregate Material Indebtedness.

SECTION 3.13. Solvency. Immediately after the consummation of the Transactions
to occur on the Effective Date, (i) the fair value of the assets of the
Borrower, at a fair valuation, will exceed its debts and liabilities,
subordinated, contingent or otherwise; (ii) the present fair saleable value of
the property of the Borrower 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; (iii) the Borrower will be able to pay its debts
and liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured; and (iv) the Borrower 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 after
the Effective Date.

SECTION 3.14. Insurance. The Borrower believes that the insurance maintained by
or on behalf of the Borrower and its Subsidiaries is adequate and is customary
for companies engaged in the same or similar businesses operating in the same or
similar locations.

SECTION 3.15. Capitalization. All of the Borrower’s Equity Interests have been
duly and validly authorized and issued and are validly outstanding, fully paid
and non-assessable.

SECTION 3.16. [intentionally omitted].

SECTION 3.17. Employment Matters. The hours worked by and payments made to
employees of the Borrower and its 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, where such violation

 

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could reasonably be expected to result in a Material Adverse Effect. 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.

SECTION 3.18. Federal Reserve Regulations. No part of the proceeds of any Loan
or Letter of Credit has been used or will be used, whether directly or
indirectly, for any purpose that entails a violation of any of the Regulations
of the Board, including Regulations T, U and X.

SECTION 3.19. Use of Proceeds. The proceeds of the Loans have been used and will
be used, whether directly or indirectly as set forth in Section 5.08.

SECTION 3.20. No Burdensome Restrictions. The Borrower is not subject to any
Burdensome Restrictions except Burdensome Restrictions permitted under Section
6.10 and Section 6.11.

SECTION 3.21. 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 or Subsidiary, 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 Loan or Letter of Credit, use of proceeds, Transaction or other
transaction contemplated by this Agreement or the other Loan Documents will
violate Anti-Corruption Laws or applicable Sanctions.

ARTICLE IV

Conditions

SECTION 4.01. Effective Date. The obligations of the Lender to make Loans and to
issue Letters of Credit hereunder shall not become effective until the date on
which each of the following conditions is satisfied (or waived in accordance
with Section 8.02):

(a) Credit Agreement and Loan Documents. The Lender (or its counsel) shall have
received (i) from each party hereto either (A) a counterpart of this Agreement
signed on behalf of such party or (B) written evidence satisfactory to the
Lender (which may include fax or other electronic transmission of a signed
signature page of this Agreement) that such party has signed a counterpart of
this Agreement and (ii) duly executed copies of the Loan Documents and such
other certificates, documents, instruments and agreements as the Lender shall
reasonably request in connection with the transactions contemplated by this
Agreement and the other Loan Documents, including a written opinion of the
Borrower’s counsel, addressed to the Lender in form and substance reasonably
satisfactory to the Lender.

(b) Financial Statements and Projections. The Lender shall have received (i)
audited consolidated financial statements of the Borrower and its Subsidiaries
for the 2014, 2015 and 2016 fiscal years and (ii) unaudited interim consolidated
financial statements of the Borrower and its Subsidiaries for each fiscal
quarter ended after the date of the latest applicable financial statements
delivered pursuant to clause (i) of this paragraph as to which such financial
statements

 

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are available, and such financial statements shall not, in the reasonable
judgment of the Lender, reflect any material adverse change in the consolidated
financial condition of the Borrower and its Subsidiaries, as reflected in the
audited, consolidated financial statements described in clause (i) of this
paragraph.

(c) Closing Certificate; Certified Articles of Incorporation; Good Standing
Certificate. The Lender shall have received (i) a certificate of the Borrower,
dated the Effective Date and executed by its Secretary or Assistant Secretary,
which shall (A) certify the resolutions of its Board of Directors, members or
other body authorizing the execution, delivery and performance of the Loan
Documents, (B) identify by name and title and bear the signatures of the
officers of the Borrower authorized to sign the Loan Documents to which it is a
party and the Financial Officers, and (C) contain appropriate attachments,
including the articles of incorporation of the Borrower certified by the
relevant authority of the jurisdiction of organization of the Borrower and a
true and correct copy of its bylaws (or certification that there has been no
change to the bylaws since the copy previously delivered to the Lender), and
(ii) a long form good standing certificate for the Borrower from its
jurisdiction of organization.

(d) [reserved]

(e) Expenses. The Lender shall have received all expenses required to be
reimbursed for which invoices have been presented (including the actual and
reasonable fees and expenses of legal counsel), on or before the Effective
Date. All such amounts will be paid with proceeds of Loans made on the Effective
Date and will be reflected in the funding instructions given by the Borrower to
the Lender on or before the Effective Date.

(f) Lien Searches. The Lender shall have received the results of a recent lien
search in the jurisdiction of organization of the Borrower and each jurisdiction
where assets of the Borrower are located, and such search shall reveal no Liens
on any of the assets of the Borrower except for liens permitted by Section 6.02.

(g) Funding Account. The Lender shall have received a notice from the Borrower
setting forth the Funding Account.

(h) Legal Due Diligence. The Lender and its counsel shall have completed all
legal due diligence, the results of which shall be satisfactory to Lender in its
sole discretion.

(i) USA PATRIOT Act, Etc. The Lender shall have received all documentation and
other information required by bank regulatory authorities under applicable “know
your customer” and anti-money laundering rules and regulations, including USA
PATRIOT Act, and a properly completed and signed IRS Form W-8 or W-9, as
applicable, for the Borrower.

(j) Other Documents. The Lender shall have received such other documents as the
Lender or its counsel may have requested that they reasonably deem necessary or
appropriate to carry out the intent of, and/or to implement, this Agreement.

The Lender shall notify the Borrower of the Effective Date, and such notice
shall be conclusive and binding.

SECTION 4.02. Each Credit Event. The obligation of the Lender to make any Loan,
and to issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:

 

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(a) The representations and warranties of the Borrower set forth in the Loan
Documents shall be true and correct in all material respects with the same
effect as though made on and as of the date of such Loan or the date of
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable (it being understood and agreed that any representation or warranty
which by its terms is made as of a specified date shall be required to be true
and correct in all material respects only as of such specified date, and that
any representation or warranty which is subject to any materiality qualifier
shall be required to be true and correct in all respects).

(b) At the time of and immediately after giving effect to such Loan or the
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no Default shall have occurred and be continuing.

Each Loan and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a) and
(b) of this Section.

ARTICLE V

Affirmative Covenants

Until the Commitment shall have expired or been terminated and the principal of
and interest on each Loan and all fees payable hereunder shall have been paid in
full and all Letters of Credit shall have expired or terminated, in each case
without any pending draw, and all LC Disbursements shall have been reimbursed,
the Borrower covenants and agrees with the Lender that:

SECTION 5.01. Financial Statements; and Other Information. The Borrower will
furnish to the Lender:

(a) within 90 days after the end of each fiscal year of the Borrower, its
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,
all reported on by independent public accountants of recognized national
standing (without a “going concern” or like qualification, commentary 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, accompanied by any management letter
prepared by said accountants;

(b) within 60 days after the end of each of the first three fiscal quarters of
the Borrower, its 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 such fiscal year, setting forth
in each case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of) the previous
fiscal year, all certified by a Financial Officer as presenting fairly in all
material respects the financial condition and results of operations of the
Borrower and 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;

 

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(c) concurrently with any delivery of financial statements under clause (a) or
(b) above (collectively or individually, as the context requires, the “Financial
Statements”), a certificate of a Financial Officer in substantially the form of
Exhibit A (i) certifying, in the case of the Financial Statements delivered
under clause (b) above, 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, (ii) 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, (iii) setting forth reasonably
detailed calculations demonstrating compliance with Sections 6.13(a), (b) and
(c) and (iv) stating whether any change in GAAP or in the application thereof
has occurred since the date of the 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) promptly after the same become publicly available, copies of all periodic
and other reports, proxy statements and other materials filed by the Borrower or
any Subsidiary with the SEC, or any Governmental Authority succeeding to any or
all of the functions of the SEC, or with any national securities exchange, or
distributed by the Borrower to its shareholders generally, as the case may be;
and

(e) promptly following any request therefor, such other information regarding
the operations, material changes in ownership of Equity Interests, business
affairs and financial condition of the Borrower or any Subsidiary, or compliance
with the terms of this Agreement, as the Lender may reasonably request.

SECTION 5.02. Notices of Material Events. The Borrower will furnish to the
Lender prompt (but in any event within any time period that may be specified
below) written notice of the following:

(a) the occurrence of any Default;

(b) receipt of any notice of any investigation by a Governmental Authority or
any litigation or proceeding commenced or threatened against the Borrower or any
Subsidiary that (i) seeks damages in excess of $3,000,000, (ii) seeks injunctive
relief, (iii) is asserted or instituted against any Plan, its fiduciaries or its
assets, (iv) alleges criminal misconduct by the Borrower or any Subsidiary, (v)
alleges the violation of, or seeks to impose remedies under any Environmental
Law or related Requirement of Law, or seeks to impose Environmental Liability,
(vi) asserts liability on the part of the Borrower or any Subsidiary in excess
of $3,000,000 in respect of any tax, fee, assessment, or other governmental
charge, or (vii) involves any product recall that could reasonably be expected
to result in a Material Adverse Effect;

(c) 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) 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.

 

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SECTION 5.03. Existence; Conduct of Business. The Borrower will, and will cause
each Subsidiary to, (a) except where the failure to do so, individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Effect, (i) do or cause to be done all things necessary to preserve, renew and
keep in full force and effect its legal existence and the rights,
qualifications, licenses, permits, franchises, governmental authorizations,
intellectual property rights, licenses and permits material to the conduct of
its business, and (ii) maintain all requisite authority to conduct its business
in each jurisdiction in which its business is conducted; provided that the
foregoing shall not prohibit any merger, consolidation, liquidation or
dissolution permitted under Section 6.03 and (b) carry on and conduct its
business (i) except where the failure to do so could not reasonably be expected
to result in a Material Adverse Effect, in substantially the same manner and
(ii) in substantially the same fields of enterprise as it is presently
conducted.

SECTION 5.04. Payment of Obligations. The Borrower will, and will cause each
Subsidiary to, pay or discharge all Material Indebtedness and all other material
liabilities and obligations, including Taxes, 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, as the case may be, has set aside on its books adequate
reserves with respect thereto in accordance with GAAP and (c) the failure to
make payment pending such contest could not reasonably be expected to result in
a Material Adverse Effect; provided, however, that the Borrower will, and will
cause each Subsidiary to, remit withholding taxes and other payroll taxes to
appropriate Governmental Authorities as and when claimed to be due,
notwithstanding the foregoing exceptions, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.

SECTION 5.05. Maintenance of Properties. The Borrower will, and will cause each
Subsidiary to, keep and maintain all property material to the conduct of its
business in good working order and condition, ordinary wear and tear excepted,
except where the failure to do so could not reasonably be expected to result in
a Material Adverse Effect.

SECTION 5.06. Books and Records; Inspection Rights. The Borrower will, and will
cause each Subsidiary to, (a) keep proper books of record and account in which
full and materially true and correct entries are made of all material dealings
and transactions in relation to its business and activities and (b) permit any
representatives designated by the Lender (including employees of the Lender or
any consultants, accountants, lawyers, agents and appraisers retained by the
Lender), upon reasonable prior notice, to visit and inspect its properties,
conduct at the Borrower’s premises field examinations of the Borrower’s assets,
liabilities, books and records, including examining and making extracts from its
books and records, environmental assessment reports and Phase I or Phase II
studies, and to discuss its affairs, finances and condition with its officers
and independent accountants, all at such reasonable times and as often as
reasonably requested; provided that, so long as no Default has occurred and is
continuing, the Borrower shall not be responsible for the costs and expenses of
any such field examination conducted more frequently than annually. Borrower
acknowledges that the Lender, after exercising its rights of inspection, may
prepare certain Reports pertaining to the Borrower’s assets for internal use by
the Lender.

SECTION 5.07. Compliance with Laws and Material Contractual Obligations. The
Borrower will, and will cause each Subsidiary to, (i) comply with each
Requirement of Law applicable to it or its property (including, without
limitation, Environmental Laws) and (ii) perform in all material respects its
obligations under material agreements to which it is a party, except, in each
case of clauses (i) and (ii), 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.

 

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SECTION 5.08. Use of Proceeds.

(a) The proceeds of the Loans and the Letters of Credit will be used only for
the Borrower’s working capital and general corporate purposes and Permitted
Acquisitions. No part of the proceeds of any Loan and no Letter of Credit will
be used, whether directly or indirectly, (i) for any purpose that entails a
violation of any of the Regulations of the Board, including Regulations T, U and
X or (ii) to make any Acquisition other than Permitted Acquisitions. Letters of
Credit will be issued only to support the Borrower’s operations in the ordinary
course of business.

(b) The Borrower will not request any Loan or Letter of Credit, and the Borrower
shall not use, and shall procure that its Subsidiaries and its or their
respective directors, officers, employees and agents shall not use, the proceeds
of any Loan or Letter of Credit (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, to
the extent such activities, businesses or transaction would be prohibited by
Sanctions if conducted by a corporation incorporated in the United States or the
European Union, or (c) in any manner that would result in the violation of any
Sanctions applicable to any party hereto.

SECTION 5.09. Accuracy of Information. The Borrower will ensure that any
information, including financial statements or other documents, furnished to the
Lender in connection with this Agreement or any other Loan Document or any
amendment or modification hereof or thereof or waiver hereunder or thereunder
contains no 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 as of the date furnished, and the
furnishing of such information shall be deemed to be a representation and
warranty by the Borrower on the date thereof as to the matters specified in this
Section 5.09.

SECTION 5.10. Insurance. The Borrower will, and will cause each Subsidiary to,
maintain with financially sound and reputable carriers having a financial
strength rating of at least A- by A.M. Best Company insurance in such amounts
(with no greater risk retention) and against such risks (including, without
limitation, loss or damage by fire and loss in transit; theft, burglary,
pilferage, larceny, embezzlement, and other criminal activities; business
interruption; and general liability) and such other hazards, as is customarily
maintained by companies of established repute engaged in the same or similar
businesses operating in the same or similar locations. Upon request by the
Lender, the Borrower will furnish to the Lender information in reasonable detail
as to the insurance so maintained.

SECTION 5.13. Depository Banks. The Borrower and each Subsidiary will maintain
the Lender as its principal depository bank, including for the maintenance of
operating, administrative, cash management, collection activity, and other
deposit accounts for the conduct of its business.

SECTION 5.14. Further Assurances. The Borrower will, and will cause each
Subsidiary to, execute and deliver, or cause to be executed and delivered, to
the Lender such documents, agreements and instruments, and will take or cause to
be taken such further actions, which may be required by any Requirement of Law
or which the Lender may, from time to time, reasonably request to carry out the
terms and conditions of this Agreement and the other Loan Documents, all at the
expense of the Borrower.

 

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ARTICLE VI

Negative Covenants

Until the Commitment shall have expired or been terminated and the principal of
and interest on each Loan and all fees, expenses and other amounts payable under
any Loan Document shall have been paid in full and all Letters of Credit shall
have expired or terminated, in each case without any pending draw, and all LC
Disbursements shall have been reimbursed, the Borrower covenants and agrees with
the Lender that:

SECTION 6.01. Indebtedness. The Borrower will not, nor will it permit any
Subsidiary to, create, incur, assume or suffer to exist any Indebtedness,
except:

(a) the Obligations, Banking Services Obligations and Swap Agreement
Obligations;

(b) Indebtedness of any Subsidiaries to the Borrower;

(c) Indebtedness of the Borrower or any Subsidiary incurred to finance the
acquisition, construction or improvement of any fixed or capital assets (whether
or not constituting purchase money Indebtedness), including Capital Lease
Obligations and any Indebtedness assumed in connection with the acquisition of
any such assets or secured by a Lien on any such assets prior to the acquisition
thereof, and extensions, renewals and replacements of any such Indebtedness in
accordance with clause (d) below; provided that (i) such Indebtedness is
incurred prior to or within 90 days after such acquisition or the completion of
such construction or improvement and (ii) the aggregate principal amount of
Indebtedness permitted by this clause (c) together with any Refinance
Indebtedness in respect thereof permitted by clause (d) below, shall not exceed
$3,000,000 at any time outstanding;

(d) Indebtedness which represents extensions, renewals, refinancing or
replacements (such Indebtedness being so extended, renewed, refinanced or
replaced being referred to herein as the “Refinance Indebtedness”) of any of the
Indebtedness described in clause (c) hereof (such Indebtedness being referred to
herein as the “Original Indebtedness”); provided that (i) such Refinance
Indebtedness does not increase the principal amount or interest rate of the
Original Indebtedness, (ii) any Liens securing such Refinance Indebtedness are
not extended to any additional property of the Borrower or any Subsidiary, (iii)
neither the Borrower nor any Subsidiary that is not originally obligated with
respect to repayment of such Original Indebtedness is required to become
obligated with respect to such Refinance Indebtedness, (iv) such Refinance
Indebtedness does not result in a shortening of the average weighted maturity of
such Original Indebtedness, (v) the terms of such Refinance Indebtedness are not
less favorable to the obligor thereunder than the original terms of such
Original Indebtedness and (vi) if such Original Indebtedness was subordinated in
right of payment to the Obligations, then the terms and conditions of such
Refinance Indebtedness must include subordination terms and conditions that are
at least as favorable to the Lender as those that were applicable to such
Original Indebtedness;

(e) Indebtedness owed to any Person providing workers’ compensation, health,
disability or other employee benefits or property, casualty or liability
insurance, pursuant to reimbursement or indemnification obligations to such
Person, in each case incurred in the ordinary course of business; and

 

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(f) Indebtedness of the Borrower or any Subsidiary in respect of performance
bonds, bid bonds, appeal bonds, surety bonds and similar obligations, in each
case provided in the ordinary course of business.

SECTION 6.02. Liens. The Borrower will not, nor will it 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) or rights in respect of any thereof, except:

(a) Liens created pursuant to any Loan Document;

(b) Permitted Encumbrances;

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

(d) Liens of a collecting bank arising in the ordinary course of business under
Section 4-208 of the UCC in effect in the relevant jurisdiction covering only
the items being collected upon; and

(e) Liens granted by a Subsidiary in favor of the Borrower in respect of
Indebtedness owed by such Subsidiary.

Notwithstanding the foregoing, none of the Liens permitted pursuant to this
Section 6.02 may at any time attach to the Borrower’s or any Subsidiary’s (i)
Accounts, other than those permitted under clause (a) of the definition of
Permitted Encumbrances and clause (a) above and (ii) Inventory, other than those
permitted under clauses (a) and (b) of the definition of Permitted Encumbrances
and clause (a) above.

SECTION 6.03. Fundamental Changes.

(a) The Borrower will not 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 Event of Default shall have occurred and be continuing, any
Subsidiary of the Borrower may merge into the Borrower in a transaction in which
the Borrower is the surviving entity.

(b) The Borrower will not, nor will it permit any Subsidiary 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 hereof and businesses reasonably
related thereto.

(c) The Borrower will not, nor will it permit any Subsidiary to, change its
fiscal year or any fiscal quarter from the basis in effect on the Effective
Date.

 

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(d) The Borrower will not change the accounting basis upon which its financial
statements are prepared.

SECTION 6.04. Acquisitions. The Borrower will not, nor will it permit any
Subsidiary to, make any Acquisition except if both before and after giving
effect to any such Acquisition and the Loans (if any) requested to be made in
connection therewith, each of the representations and warranties in the Loan
Documents is true and correct (except any such representation or warranty which
relates only to a specified prior date, in which case such representation and
warranty shall remain true and correct as of such specified prior date) and no
Default exists, will exist, or would result therefrom.

SECTION 6.05. [reserved].

SECTION 6.06. Sale and Leaseback Transactions. The Borrower will not, nor will
it permit any Subsidiary to, enter into any arrangement, directly or indirectly,
whereby it shall sell or transfer any property, real or personal, used or useful
in its business, whether now owned or hereafter acquired, and thereafter rent or
lease such property or other property that it intends to use for substantially
the same purpose or purposes as the property sold or transferred (a “Sale and
Leaseback Transaction”), except for any such sale of any fixed or capital assets
by the Borrower or any Subsidiary that is made for cash consideration in an
amount not less than the fair value of such fixed or capital asset and is
consummated within 90 days after the Borrower or such Subsidiary acquires or
completes the construction of such fixed or capital asset.

SECTION 6.07. Swap Agreements. The Borrower will not, nor will it permit any
Subsidiary 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 Subsidiary), and (b) Swap Agreements entered into in order to effectively
cap, collar or exchange interest rates (from floating to fixed 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; Certain Payments of Indebtedness.

(a) The Borrower will not, nor will it permit any Subsidiary to, declare or
make, or agree to declare or make, directly or indirectly, any Restricted
Payment, or incur any obligation (contingent or otherwise) to do so, if any
Event of Default has occurred and is continuing or would result after giving
effect to such payment.

(b) The Borrower will not, nor will it permit any Subsidiary to, make or agree
to pay or make, directly or indirectly, any payment or other distribution
(whether in cash, securities or other property) of or in respect of principal of
or interest on any Indebtedness, or any payment or other distribution (whether
in cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any Indebtedness, except:

(i) payment of Indebtedness created under the Loan Documents;

(ii) payment of regularly scheduled interest and principal payments as and when
due in respect of any Indebtedness permitted under Section 6.01;

(iii) refinancings of Indebtedness to the extent permitted by Section 6.01; and

 

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(iv) payment of secured Indebtedness that becomes due as a result of the
voluntary sale or transfer of the property or assets securing such Indebtedness
to the extent such sale or transfer is permitted by the terms of Section 6.05.

SECTION 6.09. Transactions with Affiliates. The Borrower will not, nor will it
permit any Subsidiary to, sell, lease or otherwise transfer any property or
assets to, or purchase, lease or otherwise acquire any property or assets from,
or otherwise engage in any other transactions with, any of its Affiliates,
except (a) transactions between the Borrower and any of its Subsidiaries or
between any such Subsidiary and any other such Subsidiary, (b) transactions that
(i) are in the ordinary course of business and (ii) 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, (c) any
Restricted Payment permitted by Section 6.08, (d) loans or advances made by the
Borrower or any Subsidiary to its employees on an arm’s-length basis in the
ordinary course of business consistent with past practices for travel and
entertainment expenses, relocation costs and similar purposes, (e) the payment
of reasonable fees to directors of the Borrower or any Subsidiary who are not
employees of the Borrower or any Subsidiary, and compensation and employee
benefit arrangements paid to, and indemnities provided for the benefit of,
directors, officers or employees of the Borrower or its Subsidiaries in the
ordinary course of business, and (f) any issuances of securities or other
payments, awards or grants in cash, securities or otherwise pursuant to, or the
funding of, employment agreements, stock options and stock ownership plans
approved by the Borrower’s board of directors.

SECTION 6.10. Negative Pledge 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 the ability of the Borrower or any Subsidiary to create,
incur or permit to exist any Lien upon any of its property or assets; provided
that (i) the foregoing shall not apply to restrictions and conditions imposed by
any Loan Document, (ii) the foregoing shall not apply to customary restrictions
and conditions contained in agreements relating to the sale of a Subsidiary
pending such sale, provided such restrictions and conditions apply only to the
Subsidiary that is to be sold and such sale is permitted hereunder, (iii) 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 and (iv) the foregoing shall not apply to customary provisions in
leases and other contracts restricting the assignment thereof.

SECTION 6.11. Other 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 the ability of any Subsidiary to pay dividends or other
distributions with respect to any Equity Interests or to make or repay loans or
advances to the Borrower or any other Subsidiary or to Guarantee Indebtedness of
the Borrower or any other Subsidiary; provided that (i) the foregoing shall not
apply to restrictions and conditions imposed by any Requirement of Law or by any
Loan Document and (ii) the foregoing shall not apply to customary restrictions
and conditions contained in agreements relating to the sale of a Subsidiary
pending such sale, provided such restrictions and conditions apply only to the
Subsidiary that is to be sold and such sale is permitted hereunder.

SECTION 6.12. Amendment of Material Documents. The Borrower will not, nor will
it permit any Subsidiary to, amend, modify or waive any of its rights under its
charter, articles or certificate of organization or incorporation and bylaws or
operating, management or partnership agreement, or other organizational or
governing documents, to the extent any such amendment, modification or waiver
would be adverse to the Lender in any material respect.

 

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SECTION 6.13. Financial Covenants.

(a) Debt Service Coverage Ratio. The Borrower will not permit the Debt Service
Coverage Ratio, determined for any period of four consecutive fiscal quarters
ending on the last day of any fiscal quarter, to be less than 2.50 to 1.00.

(b) Funded Indebtedness to EBITDA Ratio. The Borrower will not permit the Funded
Indebtedness to EBITDA Ratio, on the last day of any fiscal quarter ending
during any period set forth below, to be greater than 2.50 to 1.00.

(c) Tangible Net Worth. The Borrower and its Subsidiaries on a consolidated
basis shall have, on the last day of each fiscal quarter, Tangible Net Worth
greater than $55,000,000.

ARTICLE VII

Events of Default

If any of the following events (“Events of Default”) shall occur:

(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise;

(b) the Borrower shall fail to pay any interest on any Loan or any fee or any
other amount (other than an amount referred to in clause (a) of this Article)
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) days;

(c) any representation or warranty made or deemed made by or on behalf of the
Borrower or any Subsidiary in or in connection with this Agreement or any other
Loan Document or any amendment or modification hereof or thereof or waiver
hereunder or thereunder, or in any report, certificate, financial statement or
other document furnished pursuant to or in connection with this Agreement or any
other Loan Document or any amendment or modification hereof or thereof or waiver
hereunder or thereunder, shall prove to have been materially incorrect when made
or deemed made;

(d) the Borrower shall fail to observe or perform any covenant, condition or
agreement contained in Section 5.02(a), 5.03 (with respect to the Borrower’s
existence) or 5.08 or in Article VI;

(e) the Borrower shall fail to observe or perform any covenant, condition or
agreement contained in this Agreement (other than those specified in clause (a),
(b) or (d)), and such failure shall continue unremedied for a period of (i) five
(5) days after the earlier of the Borrower’s knowledge of such breach or notice
thereof from the Lender if such breach relates to terms or provisions of Section
5.01, 5.02 (other than Section 5.02(a)), 5.03 through 5.07, 5.10, 5.11 or 5.13
of this Agreement or (ii) fifteen (15) days after the earlier of the Borrower’s
knowledge of such breach or notice thereof from the Lender if such breach
relates to terms or provisions of any other Section of this Agreement;

 

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

(g) 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 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 to the extent such sale or transfer is
permitted by the terms of Section 6.05;

(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed seeking (i) liquidation, reorganization or other relief in
respect of the Borrower or any 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
sixty (60) days or an order or decree approving or ordering any of the foregoing
shall be entered;

(i) 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 Article, (iii) apply for or consent to the appointment of
a receiver, trustee, custodian, sequestrator, conservator or similar official
for the Borrower or Subsidiary of the Borrower 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) the Borrower or any Subsidiary shall become unable, admit in writing its
inability, or publicly declare its intention not to, or fail generally, to pay
its debts as they become due;

(k) one or more judgments for the payment of money in an aggregate amount in
excess of $3,000,000 shall be rendered against the Borrower, any Subsidiary or
any combination thereof and the same shall remain undischarged for a period of
thirty (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 or the Borrower or any Subsidiary shall fail within thirty (30) days to
discharge one or more non-monetary judgments or orders which, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect,
which judgments or orders, in any such case, are not stayed on appeal and being
appropriately contested in good faith by proper proceedings diligently pursued;

(l) an 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) a Change in Control shall occur;

 

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(n) the occurrence of any “default”, as defined in any Loan Document (other than
this Agreement), or the breach of any of the terms or provisions of any Loan
Document (other than this Agreement), which default or breach continues beyond
any period of grace therein provided; or

(o) any material provision of any Loan Document for any reason ceases to be
valid, binding and enforceable in accordance with its terms (or the Borrower
shall challenge the enforceability of any Loan Document or shall assert in
writing, or engage in any action or inaction that evidences its assertion, that
any provision of any of the Loan Documents has ceased to be or otherwise is not
valid, binding and enforceable in accordance with its terms);

then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Lender may, by notice to the Borrower,
take either or both of the following actions, at the same or different
times: (i) terminate the Commitment, whereupon the Commitment shall terminate
immediately, and (ii) declare the Loans then outstanding to be due and payable
in whole (or in part, in which case any principal not so declared to be due and
payable may thereafter be declared to be due and payable), whereupon 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, in each case without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower; and in the case of any event with respect to the
Borrower described in clause (h) or (i) of this Article, the Commitment shall
automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and all fees and other obligations of the
Borrower accrued hereunder, shall automatically become due and payable, in each
case without presentment, demand, protest or other notice of any kind, all of
which are hereby waived by the Borrower. Upon the occurrence and during the
continuance of an Event of Default (in each case, for the sake of greater
clarity, only after giving effect to any applicable grace or cure period
expressly set forth in clauses (a) through (o) of this Article), the Lender may
(i) by notice to the Borrower, increase the rate of interest applicable to the
Loans and other Obligations as set forth in this Agreement and (ii) exercise any
rights and remedies provided to the Lender under the Loan Documents or at law or
equity, including all remedies provided under the UCC.

ARTICLE VIII

Miscellaneous

SECTION 8.01. 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 fax, as follows:

(i) if to the Borrower at:

620 Lesher Place

Lansing, Michigan 48912

Attention: Chief Financial Officer

Fax No:                                         

 

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With a copy to:

Lowe Law Firm, PC

2375 Woodlake Drive, Suite 380

Okemos, Michigan 48864

Attention: Dick Lowe

Fax No: (517) 908-0908

(ii) if to JPMorgan Chase Bank, N.A. at:

JPMorgan Chase Bank, N.A.

Middle Market Servicing

10 South Dearborn, Floor L2

Suite IL1-0480

Chicago, Illinois, 60603-2300

Attention:                                 

Fax No: (312)                         

With a copy to:

JPMorgan Chase Bank, N.A.

200 Ottawa Ave. NW

Grand Rapids, Michigan 49503

Attention: Deborah M. Herdegen

Fax No: (616) 459-8779

All such notices and other communications (i) sent by hand or overnight courier
service, or mailed by certified or registered mail, shall be deemed to have been
given when received, (ii) sent by fax shall be deemed to have been given when
sent, provided that if not given during normal business hours for the recipient,
such notice or communication shall be deemed to have been given at the opening
of business on the next Business Day of the recipient, or (iii) delivered
through electronic communication to the extent provided in paragraph (b) below
shall be effective as provided in such paragraph.

(b) Notices and other communications to the Lender hereunder may be delivered or
furnished by electronic communications (including e-mail and internet or
intranet websites) pursuant to procedures approved by the Lender; provided that
the foregoing shall not apply to notices pursuant to Article II unless otherwise
agreed by the Lender. Each of the Lender 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. All such
notices and other communications (i) 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), provided that if not given
during the normal business hours of the recipient, such notice or communication
shall be deemed to have been given at the opening of business on the next
Business Day for the recipient, and (ii) 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, e-mail 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 of the
recipient.

 

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

SECTION 8.02. Waivers; Amendments.

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

(b) Neither this Agreement nor any other Loan Document nor any provision hereof
or thereof may be waived, amended or modified except pursuant to an agreement or
agreements in writing entered into by the Borrower and the Lender.

SECTION 8.03. Expenses; Indemnity; Damage Waiver.

(a) The Borrower shall pay all (i) reasonable out-of-pocket expenses incurred by
the Lender and its Affiliates, including the reasonable fees, charges and
disbursements of counsel for the Lender (whether outside counsel or the
allocated costs of its internal legal department), in connection with the credit
facilities provided for herein, the preparation and administration of the Loan
Documents and any amendments, modifications or waivers of the provisions of the
Loan Documents (whether or not the transactions contemplated hereby or thereby
shall be consummated), (ii) reasonable out-of-pocket expenses incurred by the
Lender in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder and (iii) out-of-pocket
expenses incurred by the Lender, including the reasonable fees, charges and
disbursements of any counsel for the Lender (whether outside counsel or the
allocated costs of its internal legal department), in connection with the
enforcement, collection or protection of its rights in connection with the Loan
Documents, including its rights under this Section, or in connection with the
Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit. Expenses being
reimbursed by the Borrower under this Section include, without limiting the
generality of the foregoing, fees, costs and expenses incurred in connection
with:

(A) appraisals and insurance reviews;

(B) field examinations and the preparation of Reports based on the fees charged
by a third party retained by the Lender or the internally allocated fees for
each Person employed by the Lender with respect to each field examination;

(C) background checks regarding senior management and/or key investors, as
deemed necessary or appropriate in the sole discretion of the Lender;

 

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(D) sums paid or incurred to take any action required of the Borrower under the
Loan Documents that the Borrower fails to pay or take; and

(F) forwarding loan proceeds, collecting checks and other items of payment, and
establishing and maintaining the accounts and lock boxes, and costs and expenses
of preserving and protecting the Collateral.

All of the foregoing fees, costs and expenses may be charged to the Borrower as
Loans or to another deposit account, all as described in Section 2.16(c).

(b) The Borrower shall indemnify the Lender, and each Related Party of the
Lender (each such Person being called an “Indemnitee”) against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, penalties,
incremental taxes, liabilities and related expenses, including the 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 the Loan Documents or any agreement or
instrument contemplated thereby, the performance by the parties hereto of their
respective obligations thereunder or the consummation of the Transactions or any
other transactions contemplated hereby, (ii) any Loan or Letter of Credit or the
use of the proceeds therefrom (including any refusal by the Lender to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such Letter
of Credit), (iii) any actual or alleged presence or Release of Hazardous
Materials on or from any property owned or operated by the Borrower or a
Subsidiary, or any Environmental Liability related in any way to the Borrower or
Subsidiary, (iv) the failure of the Borrower to deliver to the Lender the
required receipts or other required documentary evidence with respect to a
payment made by the Borrower for Taxes pursuant to Section 2.15, or (v) 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 their respective equity holders,
Affiliates, creditors or any other third Person and whether based on contract,
tort or any other theory 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, penalties,
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 8.03(b) shall
not apply with respect to Taxes other than any Taxes that represent losses or
damages arising from any non-Tax claim.

(c) To the extent permitted by applicable law, the Borrower shall not assert,
and the Borrower hereby waives, any claim against any Indemnitee, (i) for any
damages arising from the use by others of information or other materials
obtained through telecommunications, electronic or other information
transmission systems (including the Internet), or (ii) on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement, any other Loan Document, or any agreement or instrument
contemplated hereby or thereby, the Transactions, any Loan or Letter of Credit
or the use of the proceeds thereof; provided that, nothing in this paragraph (c)
shall relieve the Borrower of any obligation it may have to indemnify an
Indemnitee against special, indirect, consequential or punitive damages asserted
against such Indemnitee by a third party.

(d) All amounts due under this Section shall be payable promptly after written
demand therefor.

SECTION 8.04. Successors and Assigns.

 

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(a) The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns
permitted hereby (including any Affiliate of the Lender that issues any Letter
of Credit), except that the Borrower may not assign or otherwise transfer any of
its rights or obligations hereunder without the prior written consent of the
Lender (and any attempted assignment or transfer by the Borrower without such
consent shall be null and void). Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby (including any
Affiliate of the Lender that issues any Letter of Credit), Participants (to the
extent provided in paragraph (c) of this Section) and, to the extent expressly
contemplated hereby, the Related Parties of the Lender) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

(b) The Lender may assign to one or more assignees all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans at the time owing to it) with the prior written consent
(such consent not to be unreasonably withheld) of the Borrower, provided that
the Borrower shall be deemed to have consented to any such assignment unless it
shall object thereto by written notice to the Lender within five (5) Business
Days after having received notice thereof, and provided further that no consent
of the Borrower shall be required for an assignment to an Affiliate of the
Lender, an Approved Fund or, if an Event of Default has occurred and is
continuing, any other assignee;

For the purposes of this Section 8.04(b), the term “Approved Fund” has the
following meaning:

“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) the Lender, (b) an Affiliate of the Lender or (c) an entity or an
Affiliate of an entity that administers or manages the Lender.

(c) The Lender may, without the consent of the Borrower, sell participations to
one or more banks or other entities (a “Participant”) in all or a portion of the
Lender’s rights and obligations under this Agreement (including all or a portion
of its Commitment and Letters of Credit and the Loans owing to it); provided
that (i) the Lender’s obligations under this Agreement shall remain unchanged;
(ii) the Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations; and (iii) the Borrower shall continue to
deal solely and directly with the Lender in connection with the Lender’s rights
and obligations under this Agreement. The Borrower agrees that each Participant
shall be entitled to the benefits of Sections 2.13, 2.14 and 2.15 (subject to
the requirements and limitations therein) to the same extent as if it were the
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section; provided that such Participant shall not be entitled to receive
any greater payment under Section 2.13 or 2.15, with respect to any
participation, than its participating Lender would have been entitled to
receive, except to the extent such entitlement to receive a greater payment
results from a Change in Law that occurs after the Participant acquired the
applicable participation.

To the extent permitted by law, each Participant also shall be entitled to the
benefits of Section 8.08 as though it were the Lender. If the Lender shall sell
a participation, it shall, acting solely for this purpose as an agent of the
Borrower, maintain a register on which it enters the name and address of each
Participant and the principal amounts (and stated interest) of each
Participant’s interest in the Loans or other obligations under this Agreement or
any other Loan Document (the “Participant Register”); provided that the Lender
shall have no 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 Commitment, Loans, Letters of Credit or its
other obligations under this Agreement) to any Person except to the extent that
such disclosure is necessary to establish that such Commitment, Loan, Letter of
Credit or other

 

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obligation is in registered form under Section 5f.103-1(c) of the U.S. Treasury
Regulations. The entries in the Participant Register shall be conclusive absent
manifest error, and the 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.

(d) The 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 the
Lender, including without limitation 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 the Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for the Lender
as a party hereto.

SECTION 8.05. Survival. All covenants, agreements, representations and
warranties made by the Borrower in the Loan Documents and in the certificates or
other instruments delivered in connection with or pursuant to this Agreement or
any other Loan Document shall be considered to have been relied upon by the
other parties hereto and shall survive the execution and delivery of the Loan
Documents and the making of any Loans and issuance of any Letters of Credit,
regardless of any investigation made by any such other party or on its behalf
and notwithstanding that the Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any fee or any other amount
payable under this Agreement is outstanding and unpaid or any Letter of Credit
is outstanding and so long as the Commitment has not expired or terminated. The
provisions of Sections 2.13, 2.14, 2.15 and Section 8.03 shall survive and
remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Letters of Credit and the Commitment or the termination of
this Agreement or any other Loan Document or any provision hereof or thereof.

SECTION 8.06. Counterparts; Integration; Effectiveness; Electronic Execution.

(a) This Agreement may be executed in counterparts (and by different parties
hereto on different counterparts), each of which shall constitute an original,
but all of which when taken together shall constitute a single contract. This
Agreement, the other Loan Documents and any separate letter agreements with
respect to fees payable to the Lender constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 4.01, this Agreement shall become
effective when it shall have been executed by the Lender and the Borrower and
when the Lender and the Borrower shall have each received counterparts hereof
which, when taken together, bear the signatures of each of the other parties
hereto, and thereafter shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.

(b) Delivery of an executed counterpart of a signature page of this Agreement by
fax, 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 or thereby 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 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.

 

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SECTION 8.07. Severability. Any provision of any Loan Document 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 thereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

SECTION 8.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing, the 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 the Lender
or any Affiliate to or for the credit or the account of the Borrower against any
of and all the Obligations, Banking Services Obligations and Swap Agreement
Obligations, irrespective of whether or not the Lender shall have made any
demand under the Loan Documents and although such obligations may be
unmatured. The rights of the Lender under this Section are in addition to other
rights and remedies (including other rights of setoff) which the Lender may
have.

SECTION 8.09. Governing Law; Jurisdiction; Consent to Service of Process.

(a) The Loan Documents (other than those containing a contrary express choice of
law provision) shall be governed by and construed in accordance with the
internal laws (and not the law of conflicts) of the State of Michigan, but
giving effect to federal laws applicable to national banks.

(b) Each of the Borrower and the Lender hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of any
U.S. federal or Michigan State court sitting in Detroit, Michigan in any action
or proceeding arising out of or relating to any Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such state court 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.

(c) Each of the Borrower and the Lender 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) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 8.01. 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 8.10. 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 OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE OR OTHER AGENT (INCLUDING ANY
ATTORNEY) OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY

 

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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 8.11. 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 8.12. Confidentiality. The Lender 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), (c) to the extent required by any Requirement of Law
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
under any other Loan Document or any suit, action or proceeding relating to this
Agreement or any other Loan Document or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (x) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement or (y) 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 (x) becomes publicly available other than as a result of a breach of
this Section or (y) becomes available to the 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 the Borrower relating to the
Borrower or its business, other than any such information that is available to
the Lender on a non-confidential basis prior to disclosure by the Borrower;
provided that, in the case of information received from the Borrower after the
date hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

SECTION 8.13. Nonreliance; Violation of Law. The Lender hereby represents that
it is not relying on or looking to any margin stock (as defined in Regulation U
of the Board) for the repayment of the Loans provided for herein. Anything
contained in this Agreement to the contrary notwithstanding, the Lender shall
not be obligated to extend credit to the Borrower in violation of any
Requirement of Law.

SECTION 8.14. USA PATRIOT Act. The Lender is subject to the requirements of the
USA PATRIOT Act and hereby notifies the Borrower that pursuant to the
requirements of the USA PATRIOT Act, it is required to obtain, verify and record
information that identifies the Borrower, which information includes the name
and address the Borrower and other information that will allow the Lender to
identify the Borrower in accordance with the USA PATRIOT Act.

SECTION 8.15. Disclosure. The Borrower hereby acknowledges and agrees that the
Lender and/or its Affiliates from time to time may hold investments in, make
other loans to or have other relationships with, the Borrower and its
Affiliates.

 

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SECTION 8.16. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the “Charges”), shall exceed the maximum
lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to the Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by the Lender.

SECTION 8.17. [reserved].

SECTION 8.18. Amended and Restated Agreement. This Agreement amends and restates
the Prior Credit Agreement and the Note (as defined in the Prior Credit
Agreement) issued by the Borrower to the Lender in connection with the Prior
Credit Agreement (the “Prior Note”), and this Agreement is not a novation of the
Prior Credit Agreement or the Prior Note or any of the outstanding loans or
advances made under or evidenced by the Prior Credit Agreement or the Prior
Note, all of which loans and advances shall be deemed Loans made under, and
governed by the terms and conditions of, this Agreement. All accrued and unpaid
interest under or evidenced by the Prior Credit Agreement and the Prior Note
shall continue to be due and payable until paid.

[Signature Page Follows]

 

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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.

 

NEOGEN CORPORATION By:  

/s/ Steven J. Quinlan

Name:  

Steven J. Quinlan

Title:  

VP & CFO

JPMORGAN CHASE BANK, N.A. By:  

/s/ Deborah M. Herdegen

Name:  

Deborah M. Herdegen

Title:  

Vice President

 

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EXHIBIT A

COMPLIANCE CERTIFICATE

 

To: JPMorgan Chase Bank, N.A.

This Compliance Certificate (“Certificate”), for the period ended             
    , 201  , is furnished pursuant to that certain Amended and Restated Credit
Agreement dated as of November 30, 2016 (as amended, restated, modified, renewed
or extended from time to time, the “Agreement”) between Neogen Corporation (the
“Borrower”) and JPMorgan Chase Bank, N.A., as Lender. Unless otherwise defined
herein, capitalized terms used in this Certificate have the meanings ascribed
thereto in the Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1. I am the                      of the Borrower and I am authorized to deliver
this Certificate on behalf of the Borrower and its Subsidiaries;

2. I have reviewed the terms of the Agreement and I have made, or have caused to
be made under my supervision, a detailed review of the compliance of the
Borrower and its Subsidiaries with the Agreement during the accounting period
covered by the attached financial statements (the “Relevant Period”);

3. The attached financial statements of the Borrower and, as applicable, its
Subsidiaries and/or Affiliates for the Relevant Period: (a) have been prepared
on an accounting basis (the “Accounting Method”) consistent with the
requirements of the Agreement and, except as may have been otherwise expressly
agreed to in the Agreement, in accordance with GAAP consistently applied, and
(b) to the extent that the attached are not the Borrower’s annual fiscal year
end statements, are subject to normal year-end audit adjustments and the absence
of footnotes;

4. The examinations described in paragraph 2 did not disclose and I have no
knowledge of, except as set forth below, (a) the existence of any condition or
event which constitutes a Default or an Event of Default under the Agreement or
any other Loan Document during or at the end of the Relevant Period or as of the
date of this Certificate or (b) any change in the Accounting Method or in the
application thereof that has occurred since the date of the annual financial
statements delivered to the Lender in connection with the closing of the
Agreement or subsequently delivered as required in the Agreement;

5. The representations and warranties of the Borrower set forth in the Loan
Documents are true and correct in all material respects as of the date hereof,
except (i) to the extent that any such representation or warranty specifically
refers to an earlier date, in which case it is true and correct in all material
respects only as of such earlier date, and (ii) that any representation or
warranty which is subject to any materiality qualifier is true and correct in
all respects; and

 

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6. Schedule I attached hereto sets forth financial data and computations
evidencing the Borrower’s compliance with certain covenants of the Agreement,
all of which data and computations are true, complete and correct; and

Described below are the exceptions, if any, referred to in paragraph 4 hereof by
listing, in detail, the (i) nature of the condition or event, the period during
which it has existed and the action which the Borrower has taken, is taking, or
proposes to take with respect to each such condition or event or (ii) change in
the Accounting Method or the application thereof and the effect of such change
on the attached financial statements:

 

  

 

  

 

  

 

The foregoing certifications, together with the computations set forth in
Schedule I and Schedule II hereto and the financial statements delivered with
this Certificate in support hereof, are made and delivered this      day of
            ,      .

 

Neogen Corporation

By:

 

 

 

    Name:

 

 

 

    Title:

 

 

 

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Schedule I to Compliance Certificate

Compliance as of             ,          with

Provisions of Sections 6.13(a), (b) and (c) of the Agreement