Exhibit 10.2

 

 

 

$250 MILLION REVOLVING CREDIT AGREEMENT

 

made and entered into

 

as of August 28, 2007

 

by and among

 

WHOLE FOODS MARKET, INC.,

a Texas corporation,

 

EACH OF THE FINANCIAL INSTITUTIONS WHICH IS

A SIGNATORY HERETO OR WHICH MAY FROM TIME TO

TIME BECOME A PARTY HERETO,

 

JPMORGAN CHASE BANK, N.A.,

 

as Administrative Agent and Collateral Agent,

 

ROYAL BANK OF CANADA,

 

as Syndication Agent,

 

WELLS FARGO BANK, N.A.,  LASALLE BANK MIDWEST, N.A., and

 

WACHOVIA BANK, N.A.,

 

as Co-Documentation Agents,

 

and

 

J. P.  MORGAN SECURITIES INC. AND RBC CAPITAL MARKETS(1),

 

as Joint Lead Arrangers and Joint Bookrunners

 

 

 

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(1) RBC Capital Markets is a brand name for the investment banking activities of
Royal Bank of Canada.

 

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Table of Contents

 

Section

 

 

Page

 

 

 

 

 

ARTICLE I - Definitions

 

 

 

 

 

 

Section 1.1

Certain Defined Terms

 

1

Section 1.2

Accounting Terms and Determinations

 

20

 

 

 

 

 

ARTICLE II — LOANS; ETC.

 

 

 

 

 

 

Section 2.1

Loans

 

21

Section 2.2

Commitment Fees; Termination and Reductions

 

22

Section 2.3

Mandatory Prepayments; Commitment Reduction

 

23

Section 2.4

Payments

 

23

Section 2.5

Prepayments of Loans

 

24

Section 2.6

Application of Payments and Prepayments

 

25

Section 2.7

Pro Rata Treatment

 

25

Section 2.8

Payment Dates on the Loans

 

25

Section 2.9

Interest Options for Loans

 

26

Section 2.10

Special Provisions Applicable to LIBOR Rate Borrowings

 

27

Section 2.11

Payment Dates

 

29

Section 2.12

Sharing of Payments, Etc

 

29

Section 2.13

Use of Proceeds

 

29

Section 2.14

Evidence of Debt

 

29

Section 2.15

Letters of Credit

 

30

Section 2.16

Increase of Commitments

 

33

 

 

 

 

 

ARTICLE III — Conditions

 

 

 

 

 

 

Section 3.1

All Loans

 

35

Section 3.2

First Loan

 

36

Section 3.3

Determinations Under Section 32

 

38

 

 

 

 

 

ARTICLE IV — Representations and Warranties

 

 

 

 

 

 

Section 4.1

Organization

 

38

Section 4.2

Financial Statements

 

38

Section 4.3

Enforceable Obligations; Authorization

 

38

Section 4.4

Other Debt

 

38

Section 4.5

Litigation

 

39

Section 4.6

Title

 

39

Section 4.7

Taxes

 

39

Section 4.8

Subsidiaries

 

39

Section 4.9

Representations by Others

 

39

Section 4.10

Permits, Licenses, Etc

 

39

Section 4.11

ERISA

 

39

Section 4.12

Condition of Property

 

40

Section 4.13

Assumed Names

 

40

Section 4.14

Investment Company Act

 

40

Section 4.15

Margin Stock

 

40

Section 4.16

Agreements

 

40

Section 4.17

Environmental Matters

 

40

Section 4.18

Solvency

 

41

Section 4.19

Target Representations

 

41

 

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ARTICLE V — Affirmative Covenants

 

 

 

 

 

 

Section 5.1

Taxes, Existence, Regulations, Property, Etc

 

41

Section 5.2

Financial Statements and Information

 

41

Section 5.3

Financial Tests

 

42

Section 5.4

Inspection

 

42

Section 5.5

Further Assurances

 

42

Section 5.6

Books and Records

 

42

Section 5.7

Insurance

 

42

Section 5.8

ERISA

 

42

Section 5.9

Use of Proceeds

 

43

Section 5.10

Additional Guaranties

 

43

Section 5.11

Notice of Events

 

43

Section 5.12

Environmental Matters

 

44

Section 5.13

End of Fiscal Year

 

44

Section 5.14

Consummation of Merger

 

44

Section 5.15

Maintenance of Ratings

 

44

 

 

 

 

 

ARTICLE VI — Negative Covenants

 

 

 

 

 

 

Section 6.1

Indebtedness

 

46

Section 6.2

Liens

 

47

Section 6.3

Contingent Obligations

 

48

Section 6.4

Mergers, Consolidations and Dispositions and Acquisitions of Assets

 

48

Section 6.5

Nature of Business

 

50

Section 6.6

Transactions with Related Parties

 

50

Section 6.7

Loans and Investments

 

50

Section 6.8

ERISA Compliance

 

50

Section 6.9

Credit Extensions

 

51

Section 6.10

Change in Accounting Method

 

51

Section 6.11

Redemption, Dividends and Distributions

 

51

 

 

 

 

 

ARTICLE VII — Events of Default and Remedies

 

 

 

 

 

 

Section 7.1

Events of Default

 

51

Section 7.2

Remedies Cumulative

 

54

 

 

 

 

 

ARTICLE VIII — The Agent and the Issuers

 

 

 

 

 

 

Section 8.1

Authorization and Action

 

54

Section 8.2

Agent’s and Issuers’ Reliance, Etc

 

54

Section 8.3

JPMorgan and Affiliates

 

55

Section 8.4

Lender Credit Decision

 

55

Section 8.5

Indemnification

 

55

Section 8.6

Successor Agents

 

56

Section 8.7

Other Agents; Arrangers and Managers

 

56

 

 

 

 

 

ARTICLE IX — Miscellaneous

 

 

 

 

 

 

Section 9.1

No Waiver

 

56

Section 9.2

Notices

 

57

Section 9.3

Jurisdiction; Governing Law; Etc

 

58

Section 9.4

Survival; Parties Bound

 

59

Section 9.5

Counterparts

 

59

Section 9.6

Survival

 

59

 

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Section 9.7

Captions

 

59

Section 9.8

Expenses, Etc

 

59

Section 9.9

Indemnification

 

60

Section 9.10

Amendments, Etc

 

61

Section 9.11

Successors and Assigns

 

61

Section 9.12

Entire Agreement

 

63

Section 9.13

Severability

 

63

Section 9.14

Disclosures

 

64

Section 9.15

Capital Adequacy

 

64

Section 9.16

Withholding Tax

 

64

Section 9.17

Waiver of Claims

 

64

Section 9.18

Right of Setoff

 

65

Section 9.19

USA PATRIOT Act

 

65

Section 9.20

Non-Consenting Lenders; Other Lenders

 

66

Section 9.21

Confidentiality

 

66

 

EXHIBITS

 

A

 

—

 

Form of Note

B

 

—

 

Notice of Assumption

C

 

—

 

Officer’s Certificate

D

 

—

 

Request for Extension of Credit and Certificate of No Default

E

 

—

 

Rate Selection Notice

F

 

—

 

Form of Assignment and Acceptance

G-A

 

—

 

Form of Security Agreement A

G-B

 

—

 

Form of Security Agreement B

H

 

 

 

Form of Guaranty Agreement

 

SCHEDULES

1.1(a)

Disclosed Divestitures

1.1(b)

EBIT/EBITDA

1.1(c)

Guarantors

1.1(d)

Existing Letters of Credit

2.1(a)

Commitments

4.8

Subsidiaries

4.13

Assumed Names

4.16

Agreements

6.2(a)

Liens

 

iii

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REVOLVING CREDIT AGREEMENT (this “Agreement”) dated as of August 28, 2007 among
WHOLE FOODS MARKET, INC., a Texas corporation (the “Company”), JPMorgan Chase
Bank, N.A. (“JPMorgan”), as administrative agent (together with any successor
administrative agent appointed pursuant to Article VII, the “Agent”) and
collateral agent (together with any successor collateral agent appointed
pursuant to Security Agreement A or Security Agreement B, as applicable, the
“Collateral Agent”) for the lenders from time to time parties hereto (the
“Lenders”), Royal Bank of Canada, as syndication agent, Wells Fargo Bank, N A,
Wachovia Bank, N.A. and LaSalle Bank Midwest, N.A. as co-documentation agents,
and J. P. Morgan Securities Inc. and RBC Capital Markets, as joint lead
arrangers and joint bookrunners (in such capacities, the “Joint Lead
Arrangers”).

 

PRELIMINARY STATEMENTS:

 

(1)           Pursuant to the agreement and plan of merger dated as of
February 21, 2007 (as amended, supplemented or otherwise modified in accordance
with its terms, to the extent permitted hereunder, the “Merger Agreement”) among
the Company, its wholly-owned subsidiary, WFMI Merger Co., a Delaware
corporation (“Merger Sub”) and Wild Oats Markets, Inc., a Delaware corporation
(the “Target”), the Company, through Merger Sub, has commenced an offer to
purchase all the outstanding shares of the Target (the “Tender Offer”). 
Following the successful consummation of the Tender Offer,  the Company, through
Merger Sub, will acquire 100% of the outstanding shares of the Target and will
merge with and into the Target (the “Merger”).

 

(2)           The Company has requested that the Lenders provide a $250,000,000
revolving line of credit to the Company to (i) finance the Tender Offer and the
Merger Transactions and to pay related fees and expenses, and (ii) support new
store development, other acquisitions, the issuance of standby letters of credit
and other general corporate purposes, including but not limited to, the
repurchase of stock and refinancing of existing Indebtedness of the Target,
subject to the terms and conditions set forth herein.

 

(3)           The Lenders have indicated their willingness to lend such amount
on the terms and conditions of this Agreement.

 

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and
agreements contained herein, the parties hereto hereby agree as follows:

 

ARTICLE I - DEFINITIONS

 

SECTION 1.1  CERTAIN DEFINED TERMS.  UNLESS A PARTICULAR WORD OR PHRASE IS
OTHERWISE DEFINED OR THE CONTEXT OTHERWISE REQUIRES, CAPITALIZED WORDS AND
PHRASES USED IN THE LOAN DOCUMENTS HAVE THE MEANINGS PROVIDED BELOW.

 

“Additional Collateral” has the meaning specified in the Security Agreement B
attached hereto as Exhibit G-B.

 

“Additional Collateral Trigger” shall mean the date on which (a) the Borrower’s
corporate credit rating shall be (i) with respect to S&P’s corporate credit
rating, equal to or lower than BB-, and (ii) with respect to Moody’s corporate
rating system, equal to or lower than Ba3; or

 

1

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(b) the Borrower’s corporate credit rating shall be less than (i) with respect
to S&P’s corporate credit rating, BB-, or (ii) with respect to Moody’s corporate
rating system, a rating of Ba3.

 

“Additional Security Period” shall mean the period, if any, beginning with the
occurrence of the Additional Collateral Trigger until the Maturity Date.

 

“Affiliate” shall mean any Person controlling, controlled by or under common
control with any other Person; and with respect to an individual, “Affiliate”
shall also mean any other individual related to such individual by blood or
marriage.  For purposes of this definition, “control” (including “controlled by”
and “under common control with”) means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of securities, partnership or other
ownership interests, by contract or otherwise.

 

“Agent” shall have the meaning ascribed to it in the recital of parties hereto.

 

“Agent’s Account” means the Agent’s account specified by the Agent in writing to
the Company and the Lenders from time to time.

 

“Aggregate Commitment” shall mean, on any day, the aggregate of all of the
Commitments of the Lenders on such day.

 

“Agreement” shall have the meaning ascribed to it in the recital of parties
hereto.

 

“Agreement Value” means, for each Hedging Agreement, on any date of
determination, an amount determined by the Agent equal to the amount, if any,
(a) that would be payable by any Loan Party or any of its Subsidiaries to its
counterparty to such Hedging Agreement as if (i) such Hedging Agreement was
being terminated early on such date of determination, (ii) such Loan Party or
Subsidiary was the sole “Affected Party” and (iii) the Agent was the sole party
determining such payment amount (with the Agent making such determination
pursuant to the terms of the governing documentation); (b) in the case of a
Hedge Agreement traded on an exchange, the mark-to-market value of such Hedge
Agreement, which will be the unrealized loss on such Hedge Agreement to the Loan
Party or any of its Subsidiaries party to such Hedge Agreement based on the
settlement price of such Hedge Agreement on such date of determination; or
(c) in all other cases, the mark-to-market value of such Hedge Agreement, which
will be the unrealized loss on such Hedge Agreement to the Loan Party or
Subsidiary of a Loan Party to such Hedge Agreement as the amount, if any, by
which (i) the present value of the future cash flows to be paid by such Loan
Party or Subsidiary exceeds (ii) the present value of the future cash flows to
be received by such Loan Party or Subsidiary pursuant to such Hedge Agreement.

 

“Alternate Base Rate” shall mean for any day (a) the greater of (i) the Prime
Rate, and (ii) the Federal Funds Rate plus 0.50% per annum, plus (b) the
Applicable Margin in effect on such day.  For purposes of this Agreement any
change in the Alternate Base Rate due to a change in the Prime Rate or the
Federal Funds Rate shall be effective on the effective date of such change in
the Prime Rate or Federal Funds Rate, respectively.  If for any reason the Agent
shall have determined (which determination shall be conclusive and binding,
absent manifest error) that it is unable to ascertain the Federal Funds Rate for
any reason, including the inability or failure of the Agent to obtain sufficient
quotations in accordance with the terms hereof, the Alternate Base Rate shall be
the Prime Rate plus the Applicable Margin.

 

2

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

 

“Alternate Base Rate Borrowing” shall mean that portion of the principal balance
of the Loans at any time bearing interest at the Alternate Base Rate.

 

“Annual Audited Financial Statements” shall mean, with respect to each fiscal
year of the Company, the Company’s 10-K Report filed with the Securities
Exchange Commission for such fiscal year, prepared in conformity with Generally
Accepted Accounting Principles and accompanied by a report and opinion of
independent certified public accountants with an accounting firm of national
standing and reputation, which shall state that such financial statements, in
the opinion of such accountants, present fairly, in all material respects, the
financial position of the Company and its Subsidiaries, on a consolidated basis,
as of the date thereof and the results of its operations and cash flows for the
period covered thereby in conformity with Generally Accepted Accounting
Principles.

 

“Applicable Commitment Fee Percentage” shall mean with respect to any Loan on
any date of determination, the applicable rate per annum for the corresponding
rating of the Company’s corporate family ratings, and determined in accordance
with the following grid:

 

Moody’s and S&P

 

Percentage
(Per Annum)

 

BBB+ or Baa1

 

0.09

%

BBB or Baa2

 

0.125

%

BBB- and Baa3

 

0.15

%

BBB- or Baa3

 

0.175

%

BB+ and Ba1

 

0.20

%

BB+ or Ba1

 

0.225

%

BB and Ba2

 

0.25

%

BB or Ba2

 

0.30

%

Otherwise

 

0.35

%

 

For purposes of determining the Applicable Commitment Fee Percentage in the case
of split ratings, where applicable, (i) in the event of a single category split
in ratings, the higher of the two ratings shall apply, (ii) in the event of a
two-category split in ratings, the rating that is in the middle of the two
ratings shall apply and (iii) in the event that there is more than a
two-category split in ratings, the rating that is one category above the lower
rating will apply.

 

“Applicable Margin” shall mean with respect to any Loan on any date of
determination, the applicable rate per annum for the corresponding rating of the
Company’s corporate family ratings, and determined in accordance with the
following grid:

 

3

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

 

Moody’s and S&P

 

LIBOR Margin
(Per Annum)

 

ABR Margin
(Per Annum)

 

BBB+ or Baa1

 

0.375

%

0.00

%

BBB or Baa2

 

0.500

%

0.00

%

BBB- and Baa3

 

0.625

%

0.00

%

BBB- or Baa3

 

0.875

%

0.00

%

BB+ and Ba1

 

1.00

%

0.00

%

BB+ or Ba1

 

1.25

%

0.25

%

BB and Ba2

 

1.375

%

0.375

%

BB or Ba2

 

1.50

%

0.50

%

Otherwise

 

1.75

%

0.75

%

 

For purposes of determining the Applicable Margin in the case of split ratings,
where applicable, (i) in the event of a single category split in ratings, the
higher of the two ratings shall apply, (ii) in the event of a two-category split
in ratings, the rating that is in the middle of the two ratings shall apply and
(iii) in the event that there is more than a two-category split in ratings, the
rating that is one category above the lower rating will apply.

 

“Applications” shall mean all applications and agreements for Letters of Credit,
or similar instruments or agreements, in Proper Form, now or hereafter executed
by any Person in connection with any Letter of Credit now or hereafter issued or
to be issued under the terms hereof at the request of any Person.

 

“Approved Fund” means any Person (other than a natural person) that is engaged
in making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.

 

“Borrowing” shall mean an Alternate Base Rate Borrowing or a LIBOR Rate
Borrowing.

 

“Business Day” shall mean a day when the main office of the Agent is open for
business and banks in New York, New York are generally open for business.

 

“Business Entity” shall mean corporations, partnerships, joint ventures, joint
stock associations, business trusts and other business entities.

 

“Capital Lease Obligations” shall mean the obligations of the Company and its
Subsidiaries on a consolidated basis to pay rent or other amounts under a lease
of (or other

 

4

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

 

agreement conveying the right to use) real and/or personal Property which
obligations are required to be classified and accounted for as a capital lease
on a consolidated balance sheet of the Company and its Subsidiaries under
Generally Accepted Accounting Principles (including Statement of Financial
Accounting Standards No. 13 of the Financial Accounting Standards Board, as
amended) and, for purposes of this Agreement, the amount of such obligations
shall be the capitalized amount thereof, determined in accordance with Generally
Accepted Accounting Principles (including such Statement No. 13).

 

“Change of Control” shall mean any change so that any Unrelated Person (or any
Unrelated Persons acting together which would constitute a Group) together with
any Affiliate or Related Persons of such Unrelated Person or Unrelated Persons
(in each case also constituting Unrelated Persons) shall at any time after the
date hereof either (i) Beneficially Own more than fifty percent (50%) of the
aggregate voting power of all classes of Voting Stock of the Company, or
(ii) succeed in having enough of its or their nominees elected by the
stockholders to the Board of Directors of the Company so as to constitute a
majority of the Board of Directors of the Company.  As used herein,
(a) “Beneficially Own” shall mean “beneficially own” as defined in Rule 13d-3 of
the Securities and Exchange Act of 1934, as amended (the “34 Act”) or any
successor provision thereto; (b) “Group” shall mean a “group” for purposes of
Section 13(d) of the 34 Act or any successor provision; (c) “Unrelated Person”
shall mean any Person other than any trust for any employee stock ownership plan
of the Company or any Subsidiary of the Company; (d) “Related Person” shall mean
as to any Person, any other Person owning (1) five percent (5%) or more of the
outstanding common stock of such Person or (2) five percent (5%) or more of the
Voting Stock of such Person, and (e) “Voting Stock” shall mean as to any Person,
the Stock of such Person which ordinarily has voting power for the election of
directors (or persons performing similar functions) of such Person, whether at
all times or only so long as no senior class of securities has such voting power
by reason of any contingency.

 

“Code” shall mean the Internal Revenue Code of 1986, as amended, as now or
hereafter in effect, together with all regulations, rulings and interpretations
thereof or thereunder by the Internal Revenue Service.

 

“Collateral”  has the meaning specified in the Security Agreement A attached
hereto as Exhibit G-A.

 

“Collateral Agent” shall have the meaning ascribed to it in the recital of
parties hereto.

 

“Commitment” shall mean, as to any Lender, the obligation of such Lender to make
Loans and incur liability for the Letters of Credit Exposure Amount in an
aggregate principal amount at any one time outstanding up to, but not exceeding,
the amount set forth opposite such Lender’s name on Schedule 2.1(a) hereto under
the caption “Commitment”, or as to any Lender that becomes a Party hereto by
executing an Assignment and Acceptance, the amount set forth in such Assignment
and Acceptance (in each case, as the same may be reduced from time to time
pursuant to Section 2.2 hereof and increased from time to time pursuant to
Section 2.16 hereof).

 

“Commitment Fee”, with respect to any Lender, shall have the meaning assigned to
it in Section 2.2.

 

“Commitment Increase Agreement” shall have the meaning assigned to it in
Section 2.16(c).

 

“Commitment Increase Notice” shall have the meaning assigned to it in
Section 2.16(a).

 

5

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

 

“Commitment Percentage” shall mean, with respect to any Lender, the ratio,
expressed as a percentage, of (a) such Lender’s Commitment to (b) the Aggregate
Commitment.

 

“Confidential Information” means non-public information that any Loan Party
furnishes to the Agent or any Lender, unless such information is or becomes
(a) generally available to the public (other than as a result of a breach by the
Agent or any Lender of its obligations hereunder) or that is or becomes
available to the Agent or such Lender from a source other than the Loan Parties
that is not, to the best of the Agent’s or such Lender’s knowledge, acting in
violation of a confidentiality agreement with a Loan Party or (b) designated in
writing by any Loan Party as non-confidential.

 

“Consequential Loss” shall mean, with respect to (a) the Company’s payment of
principal of a LIBOR Rate Borrowing on a day other than the last day of the
applicable LIBOR Interest Period, (b) the Company’s failure to borrow a LIBOR
Rate Borrowing on the date specified by the Company for any reason, (c) the
Company’s failure to make any prepayment of the Loans (other than Alternate Base
Rate Borrowings) on the date specified by the Company, or (d) any cessation of
the LIBOR Rate to apply to the Loans or any part thereof pursuant to
Section 2.10 hereof, in each case whether voluntary or involuntary, any loss,
expense, penalty, premium or liability incurred by any of the Lenders or the
Agent, including any interest paid by any of the Lenders to lenders of funds
borrowed by them to make or carry the Loans; a “Consequential Loss” shall mean,
with respect to the termination or cancellation of any LIBOR Rate Borrowing
pursuant to Section 2.10 hereof, in each case whether voluntary or involuntary,
any loss, expense, penalty, premium or liability incurred by any of the Lenders
or the Agent on account of any reduction resulting from such premature
termination or cancellation of such borrowing in such Person’s margins or
spreads between its cost of funds and the interest earned on the principal of
the borrowing so terminated or canceled, including an amount equal to the excess
(if any) of (x) interest that would have accrued on any such borrowing during
the remainder of the applicable LIBOR Interest Period had such borrowing not
been terminated or canceled early, over (y) the interest actually accrued on the
principal amount of that terminated or canceled borrowing for such remainder of
such LIBOR Interest Period.

 

“Consolidated Net Worth” shall mean, at any time, shareholder’s equity of the
Company as set forth in the most recent consolidated Annual Audited Financial
Statements of the Company and its Subsidiaries, determined in accordance with
Generally Accepted Accounting Principles, consistently applied.

 

“Contingent Obligations” shall mean, as to any Person, without duplication, any
obligation of such Person guaranteeing or intended to guarantee the payment or
performance of any Indebtedness, leases, dividends or other obligations
(collectively “primary obligations”) of any other Person (the “primary obligor”)
in any manner, whether directly or indirectly, including without limitation, any
obligation of the Person for whom Contingent Obligations is being determined,
whether or not contingent, (a) to purchase any such primary obligation or other
property constituting direct or indirect security therefor, (b) assume or
contingently agree to become or be secondarily liable in respect of any such
primary obligation, (c) to advance or supply funds (i) for the purchase or
payment of any such primary obligation or (ii) to maintain working capital or
equity capital for the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (d) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such primary
obligation, or (e) otherwise to assure or hold harmless the owner of such
primary obligation against loss in respect thereof; provided, however, that the
term “Contingent Obligations” shall not include (x) endorsements of checks or
other negotiable

 

6

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

 

instruments in the ordinary course of business, (y) performance or payment
guarantees by the Company of any Indebtedness of any of its Subsidiaries of the
type permitted in Section 6.1(f) hereof, and (z) the obligations and liabilities
of each Guarantor to the Agent and the Lenders under the Guaranties.  The amount
of any Contingent Obligation shall be deemed to be an amount equal to the stated
or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the maximum
anticipated liability in respect thereof (assuming the Person for whom
Contingent Obligations is being determined is required to perform thereunder) as
determined by the Agent in good faith.

 

“Contribution Agreement” shall mean that certain Contribution Agreement of even
effective date herewith, by and among the Company and the Guarantors, as the
same may have been or may hereafter be amended, modified, supplemented, restated
and joined in pursuant to a Joinder Agreement, from time to time.

 

“Convertible Senior Debentures” shall mean those certain the 3.25% Convertible
Senior Debentures due 2034 which are governed by that certain Indenture dated
June 1, 2004, by and between Target and U.S. Bank National Association as
trustee.

 

“Credit Facility Hedging Agreements” shall mean any Hedging Agreement now
existing or hereafter entered into between the Company and any Lender and/or any
of their respective Affiliates in connection with all or any portion of the
Loans and/or any of the loans under the Term Loan Facility for purposes of
hedging the risk of variable interest rate volatility or fluctuations of
interest rates, as any such Hedging Agreement may be modified, supplemented and
in effect from time to time.

 

“Current Sum” shall mean on any day, as to a particular Lender, the sum of
(a) the then outstanding principal balance of such Lender’s Loans on such day
plus (b) the product of (i) such Lender’s Commitment Percentage times (ii) the
Letter of Credit Exposure Amount on such day.

 

“Current Sum Percentage” shall mean, with respect to any Lender, the ratio,
expressed as a percentage of (a) such Lender’s Current Sum to (b) the aggregate
Current Sum of all Lenders.

 

“Default” means any Event of Default or any other event or circumstance that
with the passing of time or the giving of notice, or both, would constitute an
Event of Default.

 

“Disclosed Divestitures” shall mean the proposed divestitures of the Company and
its Subsidiaries set forth in Schedule 1.1(a) hereto.

 

“Discontinued Operations” shall mean, as of any day, operations of the Company
or its Subsidiaries which have been discontinued, as reflected on the most
recent Form 10-K or 10-Q for the Company filed with the Security and Exchange
Commission, and which, as of such day, have been fully disposed of or
liquidated.

 

“EBIT” shall mean for any period for which EBIT is calculated, Net Income of the
Company and its Subsidiaries on a consolidated basis for such period plus,
without duplication, (a) non-recurring, non-cash charges of the Company and its
Subsidiaries on a consolidated basis for such period, (b) non-cash pre-opening
rent expenses of the Company and its Subsidiaries on a consolidated basis for
such period, (c) taxes of the Company and its Subsidiaries on a consolidated
basis for such period, (d) interest expense of the Company and its Subsidiaries
on a consolidated basis for such period and (e) non-cash stock compensation
expense of the Company

 

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and its Subsidiaries on a consolidated basis for such period; provided that EBIT
for the three quarters immediately prior to the Effective Date shall be as set
forth in Schedule 1.1(b).  All components of EBIT shall be determined in
accordance with Generally Accepted Accounting Principles, consistently applied.

 

“EBITDA” shall mean for any period for which EBITDA is calculated, Net Income of
the Company and its Subsidiaries on a consolidated basis for such period plus,
without duplication, (a) taxes of the Company and its Subsidiaries on a
consolidated basis for such period (calculated after excluding any gain or loss
attributable to Discontinued Operations as of such day), (b) depreciation,
depletion, obsolescence and amortization of Property of the Company and its
Subsidiaries on a consolidated basis for such period (calculated after excluding
any depreciation, depletion, obsolescence and amortization applicable to
Discontinued Operations as of such day), (c) interest expense of the Company and
its Subsidiaries on a consolidated basis for such period (calculated after
excluding any interest expense paid in connection with Discontinued Operations
as of such day), (d) non-recurring, non-cash charges of the Company and its
Subsidiaries on a consolidated basis for such period, (e) non-cash pre-opening
rent expenses of the Company and its Subsidiaries on a consolidated basis for
such period and (f) non-cash stock compensation expense of the Company and its
Subsidiaries on a consolidated basis for such period; provided that EBITDA for
the three quarters immediately prior to the Effective Date shall be as set forth
in Schedule 1.1(b).  All components of EBITDA shall be determined in accordance
with Generally Accepted Accounting Principles, consistently applied.

 

“Effective Date” has the meaning ascribed thereto in Section 3.2.

 

“Eligible Assignee” shall mean (a) a Lender, (b) an Affiliate of a Lender,
(c) an Approved Fund or (d) any other Person (other than an individual) approved
by the Agent and, except during the continuance of an Event of Default, the
Company (each such consent not to be unreasonably withheld or delayed); it being
understood that none of the Company nor any of its Affiliates shall, in any
event, be an Eligible Assignee.

 

“Environmental Claim” shall mean any third party (including any Governmental
Authority) action, lawsuit, claim or proceeding (including claims or proceedings
at common law) which seeks to impose or alleges liability for (i) preservation,
protection, conservation, pollution, contamination of, or releases or threatened
releases of Hazardous Substances into the air, surface water, ground water or
land or the clean-up, abatement, removal, remediation or monitoring of such
pollution, contamination or Hazardous Substances; (ii) generation, recycling,
reclamation, handling, treatment, storage, disposal or transportation of
Hazardous Substances or solid waste (as defined under the Resource Conservation
and Recovery Act and its regulations, as amended from time to time);
(iii) exposure to Hazardous Substances; (iv) the safety or health of employees
or other Persons in connection with any of the activities specified in any other
subclause of this definition; or (v) the manufacture, processing, distribution
in commerce, presence or use of Hazardous Substances.  An “Environmental Claim”
includes a common law action, as well as a proceeding to issue, modify or
terminate an Environmental Permit, or to adopt or amend a regulation to the
extent that such a proceeding attempts to redress violations of the applicable
permit, license, or regulation as alleged by any Governmental Authority.

 

“Environmental Liabilities” shall mean all liabilities arising from any
Environmental Claim, Environmental Permit or Requirement of Environmental Law
under any theory of recovery, at law or in equity, and whether based on
negligence, strict liability or otherwise, including:  remedial, removal,
response, abatement, restoration (including natural resources) investigative, or
monitoring liabilities, personal injury and damage to property, natural
resources

 

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or injuries to persons, and any other related costs, expenses, losses, damages,
penalties, fines, liabilities and obligations, and all costs and expenses
necessary to cause the issuance, reissuance or renewal of any Environmental
Permit including attorney’s fees and court costs.  Environmental Liability shall
mean any one of them.

 

“Environmental Permit” shall mean any permit, license, approval or other
authorization under any applicable law, regulation and other requirement of the
United States or of any state, municipality or other subdivision thereof
relating to pollution or protection of health or the environment, including
laws, regulations or other requirements relating to emissions, discharges,
releases or threatened releases of pollutants, contaminants or Hazardous
Substances or toxic materials or wastes into ambient air, surface water, ground
water or land, or otherwise relating to the manufacture, processing,
distribution, recycling, presence, use, treatment, storage, disposal, transport,
or handling of, wastes, pollutants, contaminants or Hazardous Substances.

 

“Equipment” shall have the meaning assigned to it in the Texas Business and
Commerce Code in force on the date the document using such term was executed.

 

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and all rules, regulations, rulings and
interpretations adopted by the Internal Revenue Service or the Department of
Labor thereunder.

 

“Eurocurrency Liabilities” has the meaning specified in Regulation D.

 

“Event of Default” shall mean any of the events specified in Section 7.1 hereof
or otherwise specified as an Event of Default in any other Loan Document,
provided there has been satisfied any requirement in connection with such event
for the giving of notice, or the lapse of time, or the happening of any further
condition, event or act, and Default shall mean any of such events, whether or
not any such requirement has been satisfied.

 

“Extraordinary Receipt” means any cash received by or paid to or for the account
of any Person not in the ordinary course of business, including, without
limitation, tax refunds (provided that, for greater clarity and without limiting
the foregoing, ordinary tax refunds on account of cash taxes actually paid would
be considered ordinary course), pension plan reversions, proceeds of insurance
(including, without limitation, any key man life insurance but excluding
proceeds of business interruption insurance to the extent such proceeds
constitute compensation for lost earnings), condemnation awards (and payments in
lieu thereof), indemnity payments and any purchase price adjustment received in
connection with any purchase agreement; provided, however, that an Extraordinary
Receipt shall not include cash receipts received from proceeds of insurance,
condemnation awards (or payments in lieu thereof) or indemnity payments to the
extent that such proceeds, awards or payments are received by any Person in
respect of any third party claim against such Person and applied to pay (or to
reimburse such Person for its prior payment of) such claim and the costs and
expenses of such Person with respect thereto.

 

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

 

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“Fee Letter” shall mean that certain fee letter dated as of March 16, 2007 among
JPMorgan, J. P. Morgan Securities Inc., Royal Bank of Canada, and the Company.

 

“Fixed Charge Coverage Ratio” shall mean as of any day that the Fixed Charge
Coverage Ratio is being calculated, the ratio of (a) EBIT plus Operating Lease
Expense to (b) interest expense plus Operating Lease Expense.  All components of
the Fixed Charge Coverage Ratio shall be computed for the Rolling Four Quarters
as of such day and determined for the Company and its Subsidiaries on a
consolidated basis in accordance with Generally Accepted Accounting Principles,
consistently applied; provided, that for purposes of determining interest
expense and Operating Lease Expense in the Fixed Charge Coverage Ratio for the
(a) fiscal quarter ended September 30, 2007, such interest expense and Operating
Lease Expense for the measurement period then ended shall equal such items for
such fiscal quarter multiplied by 52/13, (b) fiscal quarter ended January 20,
2008, such interest expense and Operating Lease Expense for the measuring period
then ended shall equal such items for the two fiscal quarters then ended
multiplied by 52/29, and (c) fiscal quarter ended April 30, 2008, such interest
expense and Operating Lease Expense for the measuring period then ended shall
equal such items for the three fiscal quarters then ended multiplied by 52/41;
provided also that EBIT for the three quarters immediately prior to the
Effective Date shall be as set forth in Schedule 1.1(b).

 

“Funded Indebtedness” shall mean (a) all Indebtedness of the Company and its
Subsidiaries on a consolidated basis which by its terms matures more than one
year after the applicable date of calculation of Funded Indebtedness (including
without limitation, current maturities or scheduled principal payments of Funded
Indebtedness for the applicable period for which Funded Indebtedness is being
calculated), and any Indebtedness of the Company and its Subsidiaries on a
consolidated basis maturing within one year from such date and (b) without
duplication, Capital Lease Obligations of the Company and its Subsidiaries on a
consolidated basis.  All components of Funded Indebtedness shall be determined
in accordance with Generally Accepted Accounting Principles, consistently
applied.

 

“Generally Accepted Accounting Principles” shall mean, as to a particular
Person, those principles and practices (a) which are recognized as such by the
Financial Accounting Standards Board or successor organization, (b) which are
applied for all periods after the date hereof in a manner consistent with the
manner in which such principles and practices were applied to the most recent
audited financial statements of the relevant Person furnished to the Agent and
the Lenders, and (c) which are consistently applied for all periods after the
date hereof so as to reflect properly the financial condition, and results of
operations and changes in financial position, of such Person.

 

“Governmental Authority” shall mean any foreign governmental authority, the
United States of America, any state of the United States and any political
subdivision of any of the foregoing, and any agency, instrumentality,
department, commission, board, bureau, central bank, authority, court or other
tribunal, in each case whether executive, legislative, judicial, regulatory or
administrative, having jurisdiction over the Agent, any of the Lenders or the
Company, any of the Company’s Subsidiaries or their respective Property.

 

“Guaranties” shall mean that certain Guaranty, substantially in the form of
Exhibit H hereto, by the Guarantors party thereto in favor of the Agent dated as
of the date hereof, as the same may be amended, supplemented, modified, joined
in pursuant to a Joinder Agreement and restated from time to time, and each and
every other guaranty executed by any or all of the Guarantors from time to time;
each a “Guaranty”.

 

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“Guarantors” shall mean the Persons listed on Schedule 1.1(c) hereto, each
Subsidiary that shall hereafter be required to execute and deliver a Guaranty
pursuant to the terms of this Agreement and each and every other Person
executing a guaranty from time to time guaranteeing the Indebtedness of the
Company owing from time to time to the Lenders pursuant to this Agreement or the
Notes.

 

“Hazardous Substance” shall mean any hazardous or toxic waste, substance or
product or material defined or regulated from time to time by any applicable
law, rule, regulation or order described in the definition of “Requirements of
Environmental Law,” including solid waste (as defined under RCRA or its
regulations, as amended from time to time), petroleum and any fraction thereof,
any radioactive materials and waste.

 

“Hedging Agreements” shall mean any transaction (including an agreement with
respect thereto) now or hereafter existing which is a rate swap, basis swap,
forward rate transaction, commodity swap, commodity option, equity or equity
index swap, equity or equity index option, bond option, interest rate option,
foreign exchange transaction, cap transaction, floor transaction, collar
transaction, forward transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions) or any combination
thereof, whether linked to one or more interest rates, foreign currencies,
commodity prices, equity prices or other financial measures.

 

“Incidental Liens” shall mean (i) Liens for taxes, assessments, levies or other
governmental charges (but not Liens for clean up expenses arising pursuant to
Requirements of Environmental Law) not yet due (subject to applicable grace
periods) or which are being contested in good faith and by appropriate
proceedings if adequate reserves with respect thereto are maintained on the
books of the Company in accordance with Generally Accepted Accounting
Principles; (ii) carriers’, warehousemen’s, mechanics’, landlords’, vendors’,
materialmen’s, repairmen’s, sureties’ or other like Liens (other than Liens for
clean up expenses arising pursuant to Requirements of Environmental Law) arising
in the ordinary course of business (or deposits to obtain the release of any
such Lien) and securing amounts not yet due or which are being contested in good
faith and by appropriate proceedings if, in the case of such contested Liens,
adequate reserves with respect thereto are maintained on the books of the
Company in accordance with Generally Accepted Accounting Principles;
(iii) pledges or deposits in connection with workers’ compensation, unemployment
insurance and other social security legislation; (iv) deposits not in excess at
any time of $25,000,000 in the aggregate to secure insurance in the ordinary
course of business, the performance of bids, tenders, contracts (other than
contracts for the payment of money), leases, licenses, franchises, statutory
obligations, surety and appeal bonds and performance bonds and other obligations
of a like nature incurred in the ordinary course of business and Liens to secure
progress or partial payments made to the Company or any Subsidiary and other
Liens of like nature made in the ordinary course of business; (v) easements,
rights-of-way, covenants, reservations, exceptions, encroachments, zoning and
similar restrictions and other similar encumbrances or title defects incurred in
the ordinary course of business which, in the aggregate, are not substantial in
amount, and which do not in any case singly or in the aggregate materially
detract from the value or usefulness of the property subject thereto or
materially interfere with the ordinary conduct of the business of the Company
and its Subsidiaries, taken as a whole; (vi) bankers’ liens arising by operation
of law; (vii) Liens arising pursuant to any order of attachment, distraint or
similar legal process arising in connection with any court proceeding the
payment of which is covered in full (subject to customary deductibles) by
insurance; (viii) inchoate Liens arising under ERISA to secure contingent
liabilities of the Company; and (ix) rights of lessees and sublessees in assets
leased by the Company or any Subsidiary not prohibited elsewhere herein.

 

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“Indebtedness” shall mean, as to any Person, without duplication:  (a) all
indebtedness (including principal, interest, fees and charges) of such Person
for borrowed money or for the deferred purchase price of Property or services;
(b) any other indebtedness which is evidenced by a promissory note, bond,
debenture or similar instrument; (c) any obligation under or in respect of
outstanding letters of credit (including without limitation, the Letters of
Credit), acceptances and similar obligations created for the account of such
Person; (d) all Capital Lease Obligations of such Person; (e) all indebtedness,
liabilities, and obligations secured by any Lien on any Property owned by such
Person even though such Person has not assumed or has not otherwise become
liable for the payment of any such indebtedness, liabilities or obligations
secured by such Lien; (f) net liabilities of such Person under Hedging
Agreements (determined by reference to the Agreement Value thereof) and (g) all
Contingent Obligations and Synthetic Indebtedness of such Person; provided, that
such term shall not mean or include any Indebtedness in respect of which monies
sufficient to pay and discharge the same in full (either on the expressed date
of maturity thereof or on such earlier date as such Indebtedness may be duly
called for redemption and payment) shall be deposited with a depository, agency
or trustee acceptable to the Agent in trust for the payment thereof.

 

“Interest Option” shall have the meaning ascribed to it in
Section 2.9(a) hereof.

 

“Interest Payment Dates” shall mean (a) for Alternate Base Rate Borrowings,
(1) at all times while the Notes are outstanding, the last Business Day of each
March, June, September and December, and (2) the Maturity Date; and (b) for
LIBOR Rate Borrowings, (1) if the LIBOR Interest Period applicable to such LIBOR
Rate Borrowing is equal to or less than three (3) months, the end of such LIBOR
Interest Period, and (2) in all other cases, on that day which is three
(3) calendar months following the first day of the applicable LIBOR Interest
Period (or, if such day is not a Business Day, on the next succeeding day that
is a Business Day) and at the end of such LIBOR Interest Period.

 

“Investment” shall mean the purchase or other acquisition of any securities or
Indebtedness of, or the making of any loan, advance, transfer of Property or
capital contribution to, or the incurring of any liability, contingently or
otherwise, in respect of the Indebtedness of, any Person.

 

“Investment Grade” shall mean with respect to the Moody’s corporate credit
rating system a rating of Baa3 or higher and with respect to the S&P corporate
credit rating system a rating of BBB- or higher.

 

“Issuer” shall mean any Lender which is an issuer of a Letter of Credit. The
initial Issuers will be JPMorgan and Bank of America, N.A; provided that Bank of
America, N.A. shall only be an Issuer with respect to any outstanding Letters of
Credit described in Schedule 1.1(d) issued by Bank of America, N.A., and as such
Letters of Credit issued by Bank of America, N.A. expire and are required to be
renewed or replaced, then subject to the applicable terms of this Agreement,
such Letters of Credit will be replaced with Letters of Credit issued by
JPMorgan.

 

“Joinder Agreement” shall mean any agreement, in Proper Form, executed by a
Subsidiary of the Company from time to time, pursuant to which such Subsidiary
joins in the execution and delivery of a Guaranty and the Contribution
Agreement.

 

“Joint Lead Arrangers” shall have the meaning ascribed to such term in the
recitals hereto.

 

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“JPMorgan” shall have the meaning ascribed to it in the recital of parties
hereto.

 

“Legal Requirement” shall mean any law, statute, ordinance, decree, requirement,
order, judgment, rule, regulation (or interpretation of any of the foregoing)
of, and the terms of any license or permit issued by, any Governmental
Authority.

 

“Lenders” shall have the meaning ascribed to it in the recital of parties
hereto.

 

“Letter of Credit Advances” shall mean all sums which may from time to time be
paid by any and all of the Lenders pursuant to the Letters of Credit, or any of
them, together with all other sums, fees, reimbursements or other obligations
which may be due to any or all of the Lenders pursuant to the Letters of Credit,
or any of them.

 

“Letter of Credit Exposure Amount” shall mean at any time the sum of (i) the
aggregate undrawn amount of all Letters of Credit outstanding at such time plus
(ii) the aggregate amount of all Letter of Credit Advances for which the Lenders
have not been reimbursed and which remain unpaid at such time.

 

“Letter of Credit Fee Payment Date” shall mean, with respect to any Letter of
Credit, the date of issuance thereof and the last Business Day of each March,
June, September and December which occurs after the date of issuance, but prior
to the expiry date of said Letter of Credit.

 

“Letter of Credit Termination Date” shall mean a date which is three (3) months
prior to the Maturity Date.

 

“Letters of Credit” shall mean (a) all irrevocable standby letters of credit and
all commercial letters of credit issued by any Issuer pursuant to the terms set
forth in this Agreement and (b) all outstanding letters of credit issued by
JPMorgan or Bank of America, N.A. prior to the date hereof for the account of
the Company or any of its Subsidiaries (including the Target) described as
“Revolving Credit Facility Letters of Credits” on Schedule 1.1(d).

 

“Leverage Ratio” shall mean as of any day that the Leverage Ratio is calculated,
the ratio of Funded Indebtedness of the Company and its Subsidiaries on a
consolidated basis as of such day to EBITDA of the Company and its Subsidiaries
on a consolidated basis for the Rolling Four Quarters as of such day; provided
that EBITDA for the three quarters immediately prior to the Effective Date shall
be as set forth in Schedule 1.1(b).

 

“LIBOR Business Day” shall mean a Business Day on which transactions in United
States Dollar deposits between banks may be carried on in the London, England
interbank market.

 

“LIBOR Interest Period” shall mean, for each LIBOR Rate Borrowing, a period
commencing:

 

(a)                                  on the date of such LIBOR Rate Borrowing,
or

 

(b)                                 on the last day of the immediately preceding
LIBOR Interest Period in the case of a rollover to a successive LIBOR Interest
Period, and ending on the numerically corresponding day one, two, three or (as
available) six months thereafter, as the Company shall elect in accordance
herewith; provided, (w) any LIBOR Interest Period which would otherwise end on a
day which is not a LIBOR Business Day shall be extended to the next succeeding
LIBOR

 

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Business Day, unless such LIBOR Business Day falls in another calendar month, in
which case such LIBOR Interest Period shall end on the next preceding LIBOR
Business Day; (x) any LIBOR Interest Period which begins on the last LIBOR
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such LIBOR Interest
Period) shall end on the last LIBOR Business Day of the appropriate calendar
month; (y) no LIBOR Interest Period shall ever extend beyond the Maturity Date;
and (z) LIBOR Interest Periods shall be selected by the Company in such a manner
that the LIBOR Interest Period with respect to any portion of the Loans which
shall become due shall not extend beyond such due date.

 

“LIBOR Rate” means, for any LIBOR Interest Period for all LIBOR Rate Borrowings
comprising part of the same Borrowing, (a) an interest rate per annum equal to
the rate per annum obtained by dividing (i) the rate per annum (rounded upwards,
if necessary, to the nearest 1/100 of 1%) appearing on the Reuters Screen LIBOR
01 (or any successor page) as the London interbank offered rate for deposits in
U.S. dollars at 11:00 A.M. (London time) two Business Days before the first day
of such LIBOR Interest Period for a period equal to such LIBOR Interest Period
(provided that, if for any reason such rate is not available, the term “LIBOR”
shall mean, for any LIBOR Interest Period for all LIBOR Rate Borrowings
comprising part of the same Borrowing, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBOR 01 as
the London interbank offered rate for deposits in Dollars at approximately
11:00 A.M. (London time) two Business Days prior to the first day of such LIBOR
Interest Period for a term comparable to such LIBOR Interest Period; provided,
however, if more than one rate is specified on Reuters Screen LIBOR 01, the
applicable rate shall be the arithmetic mean of all such rates) by (ii) a
percentage equal to 100% minus the LIBOR Reserve Percentage for such LIBOR
Interest Period plus (b) the Applicable Margin from time to time in effect
during such term.

 

“LIBOR Rate Borrowing” shall mean each portion of the principal balance of the
Loans at any time bearing interest at the LIBOR Rate.

 

“Lien” shall mean any mortgage, pledge, charge, encumbrance, security interest,
collateral assignment or other lien or restriction of any kind, whether based on
common law, constitutional provision, statute or contract, and shall include
reservations, exceptions, encroachments, easements, rights of way, covenants,
conditions, restrictions, leases and other title exceptions.

 

“Loan Documents” shall mean this Agreement, the Notes, the Guaranties, the
Contribution Agreement, the Joinder Agreements, Letters of Credit, the
Applications, the Fee Letter, Security Agreement A, Security Agreement B, the
Credit Facility Hedging Agreement, all instruments, certificates and agreements
now or hereafter executed or delivered to the Agent and/or the Lenders pursuant
to any of the foregoing, and all amendments, modifications, renewals,
extensions, increases and rearrangements of, and substitutions for, any of the
foregoing.

 

“Loan Party” means the Company or any Guarantor.

 

“Loans” shall mean the advances of funds described in Section 2.1 hereof.  Loan
shall mean any one of the Loans.

 

“Margin Stock” has the meaning specified in Regulation U.

 

“Material Adverse Effect” means a material adverse effect on the validity or

 

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enforceability of any material provision of the Loan Documents, on the ability
of the Company to consummate the Transactions, on the financial condition of the
Company (either individually or taken as a whole with its Subsidiaries), or on
the property, business, operations or liabilities of the Company (either
individually or taken as a whole with its Subsidiaries).

 

“Maturity Date” shall mean the earlier of (a) August 28, 2012 and (b) the date
specified by the Agent pursuant to Section 7.1 hereof.

 

“Merger” shall have the meaning ascribed to it in the Preliminary Statements
hereto.

 

“Merger Agreement” shall have the meaning ascribed to it in the Preliminary
Statements hereto.

 

“Moody’s” shall mean Moody’s Investors Service, Inc.

 

“Net Income” shall mean gross revenues and other proper income credits, less all
proper income charges, including taxes on income, all determined in accordance
with Generally Accepted Accounting Principles; provided, that there shall not be
included in such revenues (i) any income representing the excess of equity in
any Subsidiary at the date of acquisition over the investment in such
Subsidiary, (ii) any equity in the undistributed earnings of any Person which is
not a Subsidiary, (iii) any earnings of any Subsidiary for any period prior to
the date such Subsidiary was acquired, except as may be permitted under
Generally Accepted Accounting Principles in connection with the pooling of
interest method of accounting, and (iv) any gains resulting from the write-up of
assets.  Net Income shall be determined on a consolidated basis.

 

“Net Proceeds” shall mean:

 

(a)                                  with respect to any sale, lease, transfer
or other disposition of any asset of the Company or any of its Subsidiaries
(except in the case of Disclosed Divestitures listed in part A of Schedule
1.1(a)), the excess, if any, of (i) the sum of cash and Permitted Investment
Securities received in connection with such sale, lease, transfer or other
disposition (including any cash or Permitted Investment Securities received by
way of deferred payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received) less (ii) the sum of (A) the
principal amount of any Indebtedness (other than Indebtedness under the Loan
Documents) that is required to be repaid in connection with such sale, lease,
transfer or other disposition thereof, (B) the reasonable and customary
out-of-pocket costs, fees, commissions, premiums and expenses incurred by the
Company or its Subsidiaries, (C) federal, state, provincial, foreign and local
taxes reasonably estimated (on a consolidated basis) to be actually payable
within the current or the immediately succeeding tax year as a result of any
gain recognized in connection therewith and (D) a reasonable reserve for any
purchase price adjustment or any indemnification payments (fixed and contingent)
attributable to the seller’s obligations to the purchaser undertaken by the
Company or any of its Subsidiaries in connection with such sale, lease, transfer
or other disposition; provided, however, that Net Proceeds shall not include any
such amounts to the extent such amounts are reinvested or contracted to be so
reinvested in capital assets used or useful in the business of the Company and
its Subsidiaries within 270 days after the date of receipt thereof or the date
such contact is entered into; and

 

(b)                                 with respect to any Extraordinary Receipt
that is not otherwise included in clause (a) above, the sum of the cash and
Permitted Investment Securities received in

 

15

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connection therewith (including any cash or Permitted Investment Securities
received by way of deferred payment pursuant to, or by monetization of, a note
receivable or otherwise, but only as and when so received) less fees, costs, out
of pocket expenses and commissions incurred in connection with the receipt
thereof; provided, however, that Net Proceeds shall not include any such amounts
from Extraordinary Receipts (other than in respect of Customer Penalties) to the
extent such amounts are reinvested or contracted to be so reinvested in capital
assets used or useful in the business of the Company and its Subsidiaries within
270 days after the date of receipt thereof or the date such contract is entered
into.

 

“New Lender” shall have the meaning assigned to it in Section 2.16(b).

 

“New Lender Agreement” shall have the meaning assigned to it in Section 2.16(b).

 

“Non-Consenting Lender” means, in the event that the Required Lenders have
agreed to any consent, waiver or amendment pursuant to Section 9.10 that
requires the consent of one or more Lenders in addition to the Required Lenders,
any Lender who is entitled to agree to such consent, waiver or amendment but who
does not so agree.

 

“Non-Guarantor Subsidiaries” means (a) Subsidiaries of the Company organized
under the laws of a jurisdiction located outside of the United States, (b) prior
to consummation of the Merger, the Target and its Subsidiaries, and (c) any one
or more Subsidiaries of the Company designated by the Company in writing to the
Agent from time to time that do not represent, in the aggregate, (i) five
percent (5%) or more of the consolidated EBITDA of the Company and its
Subsidiaries or (ii) five percent (5%) or more of the consolidated tangible
assets of the Company and its Subsidiaries; provided, that no Subsidiary of the
Company shall be a Non-Guarantor Subsidiary to the extent that such Subsidiary
guaranties any other Indebtedness of the Company.

 

“Notes” shall mean the promissory notes, each substantially in the form of
Exhibit A attached hereto, of the Company evidencing the Loans, payable to the
order of the respective Lenders in the amount of the sum of said Lender’s Unused
Commitment and the Current Sum owing to said Lender, and all renewals,
extensions, modifications, rearrangements and replacements thereof and
substitutions therefor.  Note shall mean any one of them.

 

“Notice of Assumption” shall mean a Notice of Assumption in favor of the Agent,
substantially in the form of Exhibit B attached hereto and otherwise in Proper
Form.

 

“Officer’s Certificate” shall mean a certificate substantially in the form of
Exhibit C attached hereto.

 

“Operating Lease Expense” shall mean for any period for which Operating Lease
Expense is calculated, the aggregate amount of fixed and contingent rentals
(exclusive of payments of Capital Lease Obligations) payable by the Company and
its Subsidiaries for such period with respect to leases of Property.  Operating
Lease Expense shall be determined for the Company and its Subsidiaries on a
consolidated basis in accordance with Generally Accepted Accounting Principles,
consistently applied.

 

“Organizational Documents” shall mean, with respect to a corporation, the
certificate of incorporation, articles of incorporation and bylaws of such
corporation; with respect to a partnership, the partnership agreement
establishing such partnership; with respect to a joint venture, the joint
venture agreement establishing such joint venture, and with respect to a trust,

 

16

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the instrument establishing such trust; in each case including any and all
modifications thereof as of the date of the Loan Document referring to such
Organizational Document and any and all future modifications thereof which are
consented to by the Agent.

 

“Parties” shall mean all Persons, other than the Agent, any Lender or any
Issuer, executing any Loan Document.

 

“Past Due Rate” shall mean, on any day, the Alternate Base Rate plus two percent
(2%).

 

“Permitted Asset Dispositions” shall have the meaning attributed to such terms
in Section 6.4(z) hereof.

 

“Permitted Investment Securities” shall mean:  (1) readily marketable securities
issued or fully guaranteed by the United States of America or any agency or
wholly owned corporation thereof; (2) commercial paper rated “Prime 1” by
Moody’s Investors Service, Inc.  or A-1 by Standard and Poor’s Corporation with
maturities of not more than one hundred eighty (180) days and short term notes
payable of any Business Entity where said notes are rated at least “Prime 1” by
Moody’s Investors Service, Inc.  or “A-1” by Standard & Poor’s Corporation with
maturities of not more than ninety (90) days; (3) certificates of deposit or
repurchase certificates issued by any Lender or any other financial institution
acceptable to the Agent, all of the foregoing not having a maturity of more than
one (1) year from the date of issuance thereof; (4) securities issued by
municipalities rated AA or better by Standard & Poor’s Corporation not having a
maturity of more than one (1) year from the date of issuance thereof; and
(5) money market mutual funds having capital surplus of at least $1,000,000,000
and deemed acceptable by the Agent, substantially all of the assets of which are
comprised of securities, commercial paper, certificates of deposit or repurchase
certificates of the type described in subclauses (1) through (4) above.

 

“Permitted Stock Dispositions” shall have the meaning attributed to such terms
in Section 6.4(z) hereof.

 

“Person” shall mean any individual, corporation, trust, unincorporated
organization, Governmental Authority or any other form of entity.

 

“Plan” shall mean any plan subject to Title IV of ERISA and maintained for
employees of the Company or of any member of a “controlled group of
corporations”, as such term is defined in the Code, of which the Company or any
of its Subsidiaries it may acquire from time to time is a part, or any such plan
to which the Company or any of its Subsidiaries it may acquire from time to time
is required to contribute on behalf of its employees.

 

“Prime Rate” shall mean, for any day, the prime rate as determined from time to
time by JPMorgan as being its prime rate for that day.  Without notice to the
Company or any other Person, the Prime Rate shall automatically fluctuate upward
and downward as and in the amount by which said Prime Rate fluctuates, with each
change to be effective as of the date of each change in said Prime Rate.  The
Prime Rate is a reference rate and does not necessarily represent the lowest or
best rate actually charged to any customer, and JPMorgan disclaims any
statement, representation, or warranty to the contrary.  JPMorgan may make
commercial loans or other loans at rates of interest at, above, or below the
Prime Rate.

 

“Proper Form” shall mean in form and substance satisfactory to the Agent and, in
the case of any Application, the applicable Issuer.

 

17

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“Property” shall mean any interest in any kind of property or asset, whether
real, personal or mixed, tangible or intangible.

 

“Quarterly Unaudited Financial Statements” shall mean, with respect to each
fiscal quarter of the Company (except for the last fiscal quarter), the
Company’s 10-Q Report filed with the Securities Exchange Commission for such
fiscal quarter.  All of the Quarterly Unaudited Financial Statements of the
Company are to be prepared in accordance with Generally Accepted Accounting
Principles and certified as true and correct by a Responsible Officer of the
Company.

 

“Rate Selection Date” shall mean that Business Day which is (a) in the case of
Alternate Base Rate Borrowings, the Business Day of such borrowing or (b) in the
case of LIBOR Rate Borrowings, the date three (3) Business Days preceding the
first day of any proposed LIBOR Interest Period.

 

“Rate Selection Notice” shall have the meaning ascribed to it in
Section 2.9(b)(i) hereof.

 

“Re-Allocation Date” shall have the meaning assigned to it in Section 2.16(e).

 

“Register” shall have the meaning assigned to such term in Section 9.11(e).

 

“Regulation D” shall mean Regulation D of the Board of Governors of the Federal
Reserve System from time to time in effect and shall include any successor or
other regulation relating to reserve requirements applicable to member banks of
the Federal Reserve System.

 

“Regulatory Change” shall mean, with respect to any Lender, any change on or
after the date of this Agreement in any Legal Requirement (including Regulation
D) or the adoption or making on or after such date of any interpretation,
directive or request applying to a class of banks including such Lender under
any Legal Requirement (whether or not having the force of law) by any
Governmental Authority charged with the interpretation or administration
thereof.

 

“Request for Extension of Credit and Certificate of No Default” shall mean a
written request for extension of credit substantially in the form of Exhibit D
attached hereto.

 

“Required Lenders” shall mean two (2) or more Lenders having a majority or
greater of the Aggregate Commitment or, if the Aggregate Commitment has been
terminated, the aggregate Current Sum for all Lenders.

 

“Requirements of Environmental Law” shall mean all requirements imposed by any
law (including The Resource Conservation and Recovery Act, The Comprehensive
Environmental Response, Compensation, and Liability Act, the Clean Water Act,
the Clean Air Act, and any state analogues of any of the foregoing), rule,
regulation, or order of any Governmental Authority now or hereafter in effect
which relate to (i) noise; (ii) pollution, protection or clean-up of the air,
surface water, ground water or land; (iii) solid, gaseous or liquid waste or
Hazard Substance generation, recycling, reclamation, release, threatened
release, treatment, storage, disposal or transportation; (iv) exposure of
Persons or property to Hazardous Substances; (v) the safety or health of
employees or other Persons or (vi) the manufacture, presence, processing,
distribution in commerce, use, discharge, releases, threatened releases,
emissions or storage of Hazardous Substances into the environment.  Requirement
of Environmental Law shall mean any one of them.

 

“Responsible Officer” shall mean the chief executive officer, chief financial
officer,

 

18

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president of a Loan Party and the general counsel of the Company.  Any document
delivered hereunder that is signed by a Responsible Officer of a Loan Party
shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Loan Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Loan Party.

 

“Rolling Four Quarters” shall mean the then most recently ended four
(4) consecutive fiscal quarters of the Company for which, as of such day,
financial statements are required to have been given to the Agent and Lenders
pursuant to this Agreement.

 

“S&P” shall mean Standard & Poor’s, a division of The McGraw-Hill
Companies, Inc.

 

“Security Agreement  A”  means a security and pledge agreement substantially in
the form of Exhibit G-A hereto.

 

“Security Agreement B”  means a security and pledge agreement substantially in
the form of Exhibit G-B hereto.

 

“Solvent” and “Solvency” shall mean, with respect to any Person on a particular
date, that on such date (a) the fair value (taken on a going concern basis) of
the property of such Person is greater than the total amount of liabilities,
including, without limitation, contingent liabilities, of such Person, (b) the
present fair salable value (taken on a going concern basis) of the assets of
such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured, (c) such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person’s ability to pay such debts and
liabilities as they mature and (d) such Person is not engaged in business or a
transaction, and is not about to engage in business or a transaction, for which
such Person’s property would constitute an unreasonably small capital.  The
amount of contingent liabilities at any time shall be computed as the amount
that, in the light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability.  In determining the Solvency of any Loan Party the
contribution rights that such Loan Party will have against the other Loan
Parties and the subrogation rights that each Guarantor will have against the
Company shall be taken into account.

 

“Stock” shall mean as to a Business Entity, all capital stock or other indicia
of equity rights issued by such Business Entity from time to time.

 

“Subsidiary” of any Person shall mean any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which) more
than fifty percent (50%) of (a) the issued and outstanding capital stock having
ordinary voting power to elect a majority of the board of directors of such
corporation (irrespective of whether at the time capital stock of any other
class or classes of such corporation shall or might have voting power upon the
occurrence of any contingency), (b) the interest in the capital or profits of
such partnership, joint venture or limited liability company or (c) the
beneficial interest in such trust or estate is at the time directly or
indirectly owned or controlled by such Person, by such Person and one or more of
its other Subsidiaries or by one or more of such Person’s other Subsidiaries.

 

“Synthetic Indebtedness” shall mean the monetary obligation of a Person under
(a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property creating obligations that do not
appear on the balance sheet of such Person (excluding operating leases) but
which upon the insolvency or bankruptcy of such Person, to the

 

19

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extent functioning as debt for borrowed money, would be characterized as the
indebtedness of such Person (without regard to accounting treatment).

 

“Target” shall have the meaning ascribed to it in the Preliminary Statements
hereto.

 

“Target Representations” shall mean the representations and warranties made by
or on behalf of the Target and its Subsidiaries and contained in the Merger
Agreement and the representations and warranties of the Company with respect to
the Target and its Subsidiaries set forth in Sections 4.1, 4.3, 4.14, 4.15, 4.18
and 4.19

 

“Target Representation Limitations” means that, on the date of the initial
Borrowing hereunder until the earlier of the date of consummation of the Merger
and the Commitment Termination Date (as defined in the Term Loan Facility), the
representations and warranties of the Company set forth in Article IV in respect
of the Target and its Subsidiaries shall be limited to the Target
Representations.

 

“Taxes” shall have the meaning ascribed to it in Section 2.10(b) hereof.

 

“Tender Offer” shall have the meaning ascribed to it in the Preliminary
Statements hereto.

 

“Term Loan Facility” shall mean the senior term loan facility of the Company
dated as of the date hereof among the Company, the financial institutions from
time to time parties thereto, and Royal Bank of Canada, as administrative agent,
as the same may be amended from time to time in accordance with the terms of
this Agreement.

 

“Transactions” means the consummation of the Merger and the entering into and
borrowings under this Agreement.

 

“Uncommitted Money Market Borrowings” shall mean any Indebtedness for borrowed
funds advanced by any lender to the Company under any “discretionary guidance,”
“bid line” or other type of uncommitted money market loan facility.

 

“Unsecured Borrowed Debt” shall mean all Indebtedness resulting from borrowings
of the Company (exclusive of intercompany borrowings) from time to time owing to
Persons which is not secured by any Liens (other than borrowings from trade
creditors in the ordinary course of business).

 

“Unused Commitment” shall mean, as to a particular Lender, the difference of
such Lender’s Commitment on such day less the Current Sum applicable to such
Lender on such day.

 

SECTION 1.2  ACCOUNTING TERMS AND DETERMINATIONS.

 

Except where specifically otherwise provided:

 

(A)           THE SYMBOL “$” AND THE WORD “DOLLARS” SHALL MEAN LAWFUL MONEY OF
THE UNITED STATES OF AMERICA.

 

(B)           ANY ACCOUNTING TERM NOT OTHERWISE DEFINED SHALL HAVE THE MEANING
ASCRIBED TO IT UNDER GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.

 

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(C)           UNLESS OTHERWISE EXPRESSLY PROVIDED, ANY ACCOUNTING CONCEPT AND
ALL FINANCIAL COVENANTS SHALL BE DETERMINED ON A CONSOLIDATED BASIS, AND
FINANCIAL MEASUREMENTS SHALL BE COMPUTED WITHOUT DUPLICATION.

 

(D)           WHEREVER THE TERM “INCLUDING” OR ANY OF ITS CORRELATIVES APPEARS
IN THE LOAN DOCUMENTS, IT SHALL BE READ AS IF IT WERE WRITTEN “INCLUDING (BY WAY
OF EXAMPLE AND WITHOUT LIMITING THE GENERALITY OF THE SUBJECT OR CONCEPT
REFERRED TO)”.

 

(E)           WHEREVER THE WORD “HEREIN” OR “HEREOF” IS USED IN ANY LOAN
DOCUMENT, IT IS A REFERENCE TO THAT ENTIRE LOAN DOCUMENT AND NOT JUST TO THE
SUBDIVISION OF IT IN WHICH THE WORD IS USED.

 

(F)            REFERENCES IN ANY LOAN DOCUMENT TO SECTION NUMBERS ARE REFERENCES
TO THE SECTIONS OF SUCH LOAN DOCUMENT.

 

(G)           REFERENCES IN ANY LOAN DOCUMENT TO EXHIBITS, SCHEDULES, ANNEXES
AND APPENDICES ARE TO THE EXHIBITS, SCHEDULES, ANNEXES AND APPENDICES TO SUCH
LOAN DOCUMENT, AND THEY SHALL BE DEEMED INCORPORATED INTO SUCH LOAN DOCUMENT BY
REFERENCE.

 

(H)           ANY TERM DEFINED IN THE LOAN DOCUMENTS WHICH REFERS TO A
PARTICULAR AGREEMENT, INSTRUMENT OR DOCUMENT SHALL ALSO MEAN, REFER TO AND
INCLUDE ALL MODIFICATIONS, AMENDMENTS, SUPPLEMENTS, RESTATEMENTS, RENEWALS,
EXTENSIONS AND SUBSTITUTIONS OF THE SAME; PROVIDED THAT NOTHING IN THIS
SUBSECTION SHALL BE CONSTRUED TO AUTHORIZE ANY SUCH MODIFICATION, AMENDMENT,
SUPPLEMENT, RESTATEMENT, RENEWAL, EXTENSION OR SUBSTITUTION EXCEPT AS MAY BE
PERMITTED BY OTHER PROVISIONS OF THE LOAN DOCUMENTS.

 

(I)            ALL TIMES OF DAY USED IN THE LOAN DOCUMENTS MEAN LOCAL TIME IN
NEW YORK, NEW YORK.

 

(J)            DEFINED TERMS MAY BE USED IN THE SINGULAR OR PLURAL, AS THE
CONTEXT REQUIRES.

 

ARTICLE II - — LOANS; ETC.

 

SECTION 2.1  LOANS.

 

(A)           SUBJECT TO THE TERMS AND CONDITIONS HEREOF, EACH LENDER SEVERALLY
AGREES TO MAKE  LOANS TO THE COMPANY FROM TIME TO TIME PRIOR TO THE MATURITY
DATE, IN AN AGGREGATE PRINCIPAL AMOUNT AT ANY ONE TIME OUTSTANDING (INCLUDING
ITS LIABILITY FOR THE LETTER OF CREDIT EXPOSURE AMOUNT AT SUCH TIME) UP TO BUT
NOT EXCEEDING SUCH LENDER’S COMMITMENT ON SUCH DATE.  LOANS REPAID PRIOR TO THE
MATURITY DATE MAY BE REBORROWED PURSUANT TO THE TERMS OF THIS AGREEMENT.  EACH
LOAN WHICH IS NOT MADE TO REPAY A LETTER OF CREDIT ADVANCE PURSUANT TO
SECTION 2.4 HEREOF SHALL BE IN AN AMOUNT OF AT LEAST (I) $5,000,000 OR (II) THE
UNUSED COMMITMENT OF THE LENDERS, WHICHEVER IS LESS.  EACH REPAYMENT OF THE
LOANS SHALL BE IN AN AMOUNT OF AT LEAST $5,000,000 OR, IF LESS, THE CURRENT SUM.

 

(B)           THE COMPANY SHALL GIVE THE AGENT NOTICE OF A REQUEST FOR A LOAN IN
ACCORDANCE WITH SECTION 3.1 HEREOF.  UPON RECEIPT OF EACH SUCH NOTICE, THE AGENT
SHALL PROMPTLY GIVE EACH OF THE LENDERS NOTICE OF RECEIPT THEREOF, WHICH NOTICE
MAY BE BY TELEPHONE OR FACSIMILE.  NOT LATER THAN 1:30 P.M. (NEW YORK TIME) ON
THE DATE SPECIFIED FOR THE MAKING OF SUCH LOAN, EACH LENDER SHALL MAKE AVAILABLE
TO THE AGENT, AT THE AGENT’S ACCOUNT, SUCH LENDER’S COMMITMENT PERCENTAGE OF
SUCH LOAN IN IMMEDIATELY AVAILABLE FUNDS FOR THE ACCOUNT OF THE COMPANY.  THE
AMOUNT SO RECEIVED BY THE AGENT SHALL, SUBJECT TO THE TERMS AND CONDITIONS OF
THIS AGREEMENT, BE MADE AVAILABLE TO THE COMPANY BY DEPOSITING SAME, IN
IMMEDIATELY AVAILABLE FUNDS, IN AN ACCOUNT DESIGNATED BY THE COMPANY MAINTAINED
WITH THE AGENT OR WITH ANOTHER FINANCIAL INSTITUTION REASONABLY ACCEPTABLE TO
THE AGENT.  IF A REQUESTED LOAN SHALL

 

21

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NOT OCCUR ON ANY DATE SPECIFIED BY THE COMPANY AS SET FORTH IN THE APPLICABLE
REQUEST FOR EXTENSION OF CREDIT AND CERTIFICATE OF NO DEFAULT BECAUSE ALL OF THE
CONDITIONS FOR SUCH LOAN SET FORTH HEREIN OR IN ANY OF THE OTHER LOAN DOCUMENTS
SHALL HAVE NOT BEEN MET, THE AGENT SHALL RETURN THE AMOUNTS SO RECEIVED FROM THE
LENDERS IN RESPECT OF SUCH REQUESTED LOAN TO THE APPLICABLE LENDERS AS SOON AS
PRACTICABLE; PROVIDED, HOWEVER, IF AND TO THE EXTENT THAT THE AGENT FAILS TO
RETURN ANY SUCH AMOUNTS TO ANY APPLICABLE LENDER BY THE BUSINESS DAY FOLLOWING
THE DATE THAT THE REQUESTED LOAN WAS TO HAVE BEEN MADE, THE AGENT SHALL PAY
INTEREST ON SUCH UNRETURNED AMOUNTS FOR EACH DATE FROM SUCH DATE THAT THE
REQUESTED LOAN WAS TO HAVE BEEN MADE, TO THE DATE THAT SUCH UNRETURNED AMOUNTS
ARE RETURNED TO SUCH LENDER, SUCH INTEREST TO ACCRUE AT THE FEDERAL FUNDS RATE
AND TO BE PAYABLE UPON WRITTEN REQUEST FROM SUCH LENDER.

 

(C)           UNLESS THE AGENT SHALL HAVE RECEIVED NOTICE FROM A LENDER PRIOR TO
THE DATE OF ANY BORROWING THAT SUCH LENDER WILL NOT MAKE AVAILABLE TO THE AGENT
SUCH LENDER’S RATABLE PORTIONS OF SUCH BORROWING, THE AGENT MAY ASSUME THAT SUCH
LENDER HAS MADE SUCH PORTION AVAILABLE TO THE AGENT ON THE DATE OF SUCH
BORROWING IN ACCORDANCE WITH SUBSECTION (B) OF THIS SECTION 2.1 AND THE AGENT
MAY, IN RELIANCE UPON SUCH ASSUMPTION, MAKE AVAILABLE TO THE COMPANY ON SUCH
DATE A CORRESPONDING AMOUNT.  IF AND TO THE EXTENT THAT SUCH LENDER SHALL NOT
HAVE SO MADE SUCH RATABLE PORTION AVAILABLE TO THE AGENT, SUCH LENDER AND THE
COMPANY SEVERALLY AGREE TO REPAY OR PAY TO THE AGENT FORTHWITH ON DEMAND SUCH
CORRESPONDING AMOUNT AND TO PAY INTEREST THEREON, FOR EACH DAY FROM THE DATE
SUCH AMOUNT IS MADE AVAILABLE TO THE BORROWER UNTIL THE DATE SUCH AMOUNT IS
REPAID OR PAID TO THE AGENT, AT (I) IN THE CASE OF THE COMPANY, THE INTEREST
RATE APPLICABLE AT SUCH TIME UNDER SECTION 2.9 TO LOANS COMPRISING SUCH
BORROWING AND (II) IN THE CASE OF SUCH LENDER, THE FEDERAL FUNDS RATE.  IF SUCH
LENDER SHALL PAY TO THE AGENT SUCH CORRESPONDING AMOUNT, SUCH AMOUNT SO PAID
SHALL CONSTITUTE SUCH LENDER’S LOAN AS PART OF SUCH BORROWING FOR ALL PURPOSES.

 

(D)           THE OBLIGATIONS OF THE LENDERS HEREUNDER ARE SEVERAL AND NOT
JOINT; THEREFORE, NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, (I) NO LENDER
SHALL BE REQUIRED TO MAKE LOANS AT ANY ONE TIME OUTSTANDING IN EXCESS OF SUCH
LENDER’S COMMITMENT, (II) IF A LENDER FAILS TO MAKE A LOAN AS AND WHEN REQUIRED
HEREUNDER AND THE COMPANY SUBSEQUENTLY MAKES A REPAYMENT ON THE LOANS, SUCH
REPAYMENT SHALL BE SPLIT AMONG THE NON-DEFAULTING LENDERS IN ACCORDANCE WITH
THEIR RESPECTIVE CURRENT SUM PERCENTAGES UNTIL EACH LENDER HAS ITS COMMITMENT
PERCENTAGE OF ALL OF THE OUTSTANDING LOANS, THEN THE BALANCE OF SUCH REPAYMENT
SHALL BE DIVIDED AMONG ALL OF THE LENDERS IN ACCORDANCE WITH THEIR RESPECTIVE
COMMITMENT PERCENTAGES (IT BEING UNDERSTOOD THAT ANY SUCH REPAYMENT TO A
DEFAULTING LENDER SHALL NOT BE DEEMED TO RELIEVE SUCH DEFAULTING LENDER FROM ANY
LIABILITY TO THE COMPANY RESULTING FROM SUCH DEFAULTING LENDER’S FAILURE TO MAKE
A LOAN AS AND WHEN REQUIRED HEREUNDER) AND (III) THE FAILURE OF ANY LENDER TO
MAKE ANY LOAN SHALL NOT IN ITSELF RELIEVE ANY OTHER LENDER OF ITS OBLIGATION TO
LEND HEREUNDER (PROVIDED, THAT NO LENDER SHALL BE RESPONSIBLE FOR THE FAILURE OF
ANY OTHER LENDER TO MAKE A LOAN SUCH OTHER LENDER IS OBLIGATED TO MAKE
HEREUNDER).

 

(E)           NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
SECTION 2.1 OR ANY OTHER PROVISION OF THIS AGREEMENT, THE COMPANY COVENANTS AND
AGREES THAT IN NO EVENT SHALL THE AGGREGATE AMOUNT OF THE LOANS AND THE LETTER
OF CREDIT EXPOSURE AMOUNT OUTSTANDING ON ANY DAY EVER EXCEED THE AMOUNT OF THE
AGGREGATE COMMITMENT THEN IN EFFECT AS OF SUCH DAY LESS THE AGGREGATE AMOUNT OF
UNCOMMITTED MONEY MARKET BORROWINGS THEN OUTSTANDING AS OF SUCH DAY.

 

SECTION 2.2  COMMITMENT FEES; TERMINATION AND REDUCTIONS.  IN CONSIDERATION OF
EACH LENDER’S UNUSED COMMITMENT, THE COMPANY AGREES TO PAY TO THE AGENT FOR THE
ACCOUNT OF EACH LENDER A COMMITMENT FEE (EACH A “COMMITMENT FEE”) (COMPUTED ON
THE BASIS OF THE ACTUAL NUMBER OF DAYS ELAPSED IN A YEAR COMPOSED OF 360 DAYS)
IN AN AMOUNT EQUAL TO THE PRODUCT OF (A) THE APPLICABLE COMMITMENT FEE
PERCENTAGE IN EFFECT FOR THE PERIOD FOR WHICH THE COMMITMENT FEE IS BEING
COMPUTED TIMES (B) SUCH LENDER’S UNUSED COMMITMENT.  THE COMMITMENT FEE SHALL BE
DUE AND PAYABLE IN ARREARS ON THE LAST BUSINESS DAY OF EACH MARCH, JUNE,
SEPTEMBER AND DECEMBER PRIOR TO THE MATURITY DATE AND ON

 

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THE MATURITY DATE, WITH EACH COMMITMENT FEE TO COMMENCE AS OF THE DATE HEREOF
AND TO BE EFFECTIVE AS TO ANY REDUCTION IN THE COMMITMENT OR CHANGE IN THE
APPLICABLE COMMITMENT FEE PERCENTAGE AS OF THE DATE OF ANY SUCH DECREASE OR
CHANGE, AND EACH COMMITMENT FEE SHALL CEASE TO ACCRUE (EXCEPT WITH RESPECT TO
PAST DUE INTEREST ON ANY UNPAID PORTION THEREOF) ON THE MATURITY DATE.  ALL PAST
DUE COMMITMENT FEES SHALL BEAR INTEREST AT THE PAST DUE RATE AND SHALL BE
PAYABLE UPON DEMAND BY THE AGENT.  THE AGGREGATE COMMITMENT MAY BE PERMANENTLY
TERMINATED OR REDUCED AS FOLLOWS, WHICH SUCH REDUCTIONS SHALL BE APPLIED PRO
RATA:

 

(A)           THE COMPANY MAY, UPON THREE (3) BUSINESS DAYS’ PRIOR WRITTEN
NOTICE TO THE AGENT, PERMANENTLY TERMINATE OR REDUCE THE AGGREGATE COMMITMENT IN
AN AMOUNT OF AT LEAST $10,000,000 OR THE AMOUNT OF THE AGGREGATE COMMITMENT AT
SUCH TIME, WHICHEVER IS LESS; AND

 

(B)           ANY PREPAYMENT OF THE LOANS AND LETTER OF CREDIT ADVANCES IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 2.3 HEREOF SHALL PERMANENTLY AND
AUTOMATICALLY REDUCE THE AGGREGATE COMMITMENT IN AN AMOUNT EQUAL TO ANY SUCH
PREPAYMENT.

 

SECTION 2.3  MANDATORY PREPAYMENTS; COMMITMENT REDUCTION.

 

(A)           IF THE CURRENT SUM APPLICABLE TO A LENDER AT ANY TIME EXCEEDS SUCH
LENDER’S COMMITMENT, THE AGENT SHALL NOTIFY THE COMPANY IN WRITING OF THE
DEFICIENCY BY OVERNIGHT PRIORITY DELIVERY SERVICE PROVIDED BY A NATIONALLY
RECOGNIZED DELIVERY SERVICE OR, IF THE OFFICER OF THE AGENT PROVIDING SUCH
NOTICE TO THE COMPANY IS LOCATED IN AUSTIN, TEXAS, BY HAND DELIVERY CONFIRMED BY
WRITTEN RECEIPT. WITHIN THREE BUSINESS DAYS AFTER THE ACTUAL RECEIPT OF SUCH
NOTICE, THE COMPANY SHALL MAKE A PREPAYMENT ON SUCH LENDER’S NOTE OR OTHERWISE
REIMBURSE THE AGENT FOR LETTER OF CREDIT ADVANCES OR CAUSE THE ONE OR MORE
LETTERS OF CREDIT TO BE CANCELED AND SURRENDERED IN AN AMOUNT SUFFICIENT TO
REDUCE SUCH CURRENT SUM TO AN AMOUNT NO GREATER THAN SUCH COMMITMENT.

 

(B)           THE COMPANY SHALL, NOT LATER THAN FIVE BUSINESS DAYS FOLLOWING THE
DATE OF RECEIPT OF ANY NET PROCEEDS BY ANY LOAN PARTY OR ANY OF ITS
SUBSIDIARIES, BY NOTICE TO THE AGENT, PREPAY THE INDEBTEDNESS OUTSTANDING UNDER
THE TERM LOAN FACILITY AND THE LOANS IN AN AMOUNT EQUAL TO THE AMOUNT OF SUCH
NET PROCEEDS, TO BE APPLIED IN THE FOLLOWING ORDER:  (I) FIRST, TO BE APPLIED
AGAINST THE INDEBTEDNESS OUTSTANDING UNDER THE TERM LOAN FACILITY; AND
(II) SECOND, THE BALANCE OF SUCH NET PROCEEDS, IF ANY, SHALL BE APPLIED AGAINST
THE AGGREGATE PRINCIPAL AMOUNT OF THE LOANS, SUCH PREPAYMENT TO BE APPLIED TO
THE LOANS ON A PRO RATA BASIS; PROVIDED THAT THIS SUBSECTION SHALL NOT APPLY TO
THE FIRST $10,000,000 OF NET PROCEEDS RECEIVED BY THE COMPANY AND ITS
SUBSIDIARIES IN ANY FISCAL YEAR OF THE COMPANY.

 

(C)           THE COMPANY SHALL, ON THE DATE THAT IS 90 DAYS FOLLOWING THE
EFFECTIVE DATE, PREPAY AN AGGREGATE PRINCIPAL AMOUNT OF THE INDEBTEDNESS
OUTSTANDING UNDER THE TERM LOAN FACILITY IN AN AMOUNT EQUAL TO THE EXCESS ABOVE
$10,000,000 OF THE AGGREGATE PRINCIPAL AMOUNT OF THE TARGET’S CONVERTIBLE SENIOR
DEBENTURES OUTSTANDING ON SUCH DATE.

 

SECTION 2.4  PAYMENTS.  ALL SUMS PAYABLE BY THE COMPANY TO THE AGENT HEREUNDER
OR PURSUANT TO NOTES FOR ITS OWN ACCOUNT OR THE ACCOUNT OF THE LENDERS SHALL BE
PAYABLE IN UNITED STATES DOLLARS IN IMMEDIATELY AVAILABLE FUNDS NOT LATER THAN
12:00 NOON ON THE DATE SUCH PAYMENT OR PREPAYMENT IS DUE AND SHALL BE MADE
WITHOUT SET-OFF, COUNTERCLAIM OR DEDUCTION OF ANY KIND.  ANY SUCH PAYMENT
RECEIVED AND ACCEPTED BY THE AGENT OR ANY ISSUER AFTER SUCH TIME SHALL BE
CONSIDERED FOR ALL PURPOSES (INCLUDING THE PAYMENT OF INTEREST, TO THE EXTENT
PERMITTED BY LAW) AS HAVING BEEN MADE ON THE NEXT SUCCEEDING BUSINESS DAY.  ALL
SUCH PAYMENTS SHALL BE MADE TO THE AGENT AT THE AGENT’S ACCOUNT.  IF ANY PAYMENT
OR PREPAYMENT BECOMES DUE AND PAYABLE ON A DAY WHICH IS NOT A BUSINESS DAY, THEN
THE DATE FOR

 

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THE PAYMENT THEREOF SHALL BE EXTENDED TO THE NEXT SUCCEEDING BUSINESS DAY AND
INTEREST SHALL BE PAYABLE THEREON AT THE THEN APPLICABLE RATE PER ANNUM DURING
SUCH EXTENSION.

 

SECTION 2.5  PREPAYMENTS OF LOANS.

 

(A)           IN ADDITION TO THE MANDATORY PREPAYMENTS REQUIRED BY SECTION 2.3
HEREOF, THE COMPANY SHALL HAVE THE RIGHT, AT ITS OPTION, TO PREPAY THE LOANS IN
WHOLE AT ANY TIME OR IN PART FROM TIME TO TIME, WITHOUT PREMIUM OR PENALTY,
EXCEPT AS PROVIDED IN THIS SECTION OR SUBSECTIONS (A), (B) OR (C) OF
SECTION 2.10 HEREOF.  EACH PARTIAL PREPAYMENT UNDER THIS SUBSECTION SHALL BE A
PRINCIPAL AMOUNT OF NOT LESS THAN $10,000,000 OR AN INTEGRAL MULTIPLE OF
$1,000,000 IN EXCESS THEREOF.  EACH PREPAYMENT UNDER THIS SUBSECTION SHALL BE
APPLIED TO THE PREPAYMENT OF THE AGGREGATE UNPAID PRINCIPAL AMOUNT OF THE
NOTES.  PREPAYMENTS UNDER THIS AGREEMENT SHALL BE SUBJECT TO THE FOLLOWING
ADDITIONAL CONDITIONS:

 

I.              IN GIVING NOTICE OF PREPAYMENT AS HEREINAFTER PROVIDED, THE
COMPANY SHALL SPECIFY, FOR THE PURPOSE OF PARAGRAPHS (II) AND (III) IMMEDIATELY
FOLLOWING, THE MANNER OF APPLICATION OF SUCH PREPAYMENT AS BETWEEN ANY
OUTSTANDING ALTERNATE BASE RATE BORROWINGS AND LIBOR RATE BORROWINGS; PROVIDED,
THAT IN NO EVENT SHALL ANY LIBOR RATE BORROWING BE PARTIALLY PREPAID.

 

II.             PREPAYMENTS APPLIED TO ANY LIBOR RATE BORROWING MAY BE MADE ON
ANY LIBOR BUSINESS DAY, PROVIDED, THAT (A) THE COMPANY SHALL HAVE GIVEN THE
AGENT AT LEAST TWO (2) LIBOR BUSINESS DAYS’ PRIOR IRREVOCABLE WRITTEN OR
FACSIMILE NOTICE OF SUCH PREPAYMENT, SPECIFYING THE PRINCIPAL AMOUNT OF THE
LIBOR RATE BORROWING TO BE PREPAID, THE PARTICULAR LIBOR RATE BORROWING TO WHICH
SUCH PREPAYMENT IS TO BE APPLIED AND THE PREPAYMENT DATE; AND (II) IF SUCH
PREPAYMENT IS MADE ON ANY DAY OTHER THAN THE LAST DAY OF THE LIBOR INTEREST
PERIOD CORRESPONDING TO THE LIBOR RATE BORROWING TO BE PREPAID, THE COMPANY
SHALL PAY DIRECTLY TO THE AGENT FOR THE ACCOUNT OF THE LENDERS, ON THE LAST DAY
OF SUCH LIBOR INTEREST PERIOD, THE CONSEQUENTIAL LOSS AS A RESULT OF SUCH
PREPAYMENT.

 

III.            PREPAYMENTS APPLIED TO ANY ALTERNATE BASE RATE BORROWING MAY BE
MADE ON ANY BUSINESS DAY, PROVIDED THAT THE COMPANY SHALL HAVE GIVEN THE AGENT
AT LEAST FIVE (5) BUSINESS DAYS PRIOR IRREVOCABLE WRITTEN NOTICE OR NOTICE BY
TELEPHONE OR FACSIMILE (WHICH IS TO BE PROMPTLY CONFIRMED IN WRITING) OF SUCH
PREPAYMENT, SPECIFYING THE PRINCIPAL AMOUNT OF THE ALTERNATE BASE RATE BORROWING
TO BE PREPAID AND THE PREPAYMENT DATE.

 

(B)           NOTICE OF ANY PREPAYMENT HAVING BEEN GIVEN, THE PRINCIPAL AMOUNT
SPECIFIED IN SUCH NOTICE, TOGETHER WITH (IN THE CASE OF ANY PREPAYMENT OF A
LIBOR RATE BORROWING) INTEREST THEREON TO THE DATE OF PREPAYMENT, SHALL BE DUE
AND PAYABLE ON SUCH PREPAYMENT DATE.

 

(C)           ANY LENDER MAY, IF IT SO ELECTS, FULFILL ITS OBLIGATION AS TO ANY
LIBOR RATE BORROWING BY CAUSING A BRANCH, FOREIGN OR OTHERWISE, OR AFFILIATE OF
SUCH LENDER TO MAKE SUCH LOANS AND MAY TRANSFER AND CARRY SUCH LOANS AT, TO OR
FOR THE ACCOUNT OF ANY BRANCH OFFICE OR AFFILIATE OF SUCH LENDER; PROVIDED, THAT
IN SUCH EVENT FOR THE PURPOSES OF THIS AGREEMENT SUCH LOANS SHALL BE DEEMED TO
HAVE BEEN MADE BY SUCH LENDER AND THE OBLIGATION OF THE COMPANY TO REPAY SUCH
LOANS SHALL NEVERTHELESS BE TO SUCH LENDER AND SHALL BE DEEMED HELD BY IT, TO
THE EXTENT OF SUCH PORTIONS OF THE LOAN, FOR THE ACCOUNT OF SUCH BRANCH OR
AFFILIATE.

 

(D)           NOTWITHSTANDING ANY PROVISION OF THIS AGREEMENT TO THE CONTRARY,
EACH LENDER SHALL BE ENTITLED TO FUND AND MAINTAIN ITS FUNDING OF ALL OR ANY
PART OF THE LOANS HEREUNDER IN ANY MANNER IT SEES FIT, IT BEING UNDERSTOOD,
HOWEVER, THAT FOR THE PURPOSES OF THIS AGREEMENT ALL DETERMINATIONS HEREUNDER
SHALL BE MADE AS IF SUCH LENDER HAD ACTUALLY FUNDED AND MAINTAINED ITS PORTION
OF EACH LIBOR

 

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RATE BORROWING DURING EACH LIBOR INTEREST PERIOD FOR THE LOANS THROUGH THE
PURCHASE OF DEPOSITS HAVING A MATURITY CORRESPONDING TO SUCH LIBOR INTEREST
PERIOD AND BEARING AN INTEREST RATE EQUAL TO THE LONDON INTERBANK RATE FOR SUCH
LIBOR INTEREST PERIOD.

 

(E)           THE COMPANY’S OBLIGATION TO PAY INCREASED COSTS AND CONSEQUENTIAL
LOSS WITH REGARD TO EACH LIBOR RATE BORROWING AS SPECIFIED IN THIS SECTION 2.5
HEREOF SHALL SURVIVE TERMINATION OF THIS AGREEMENT.

 

SECTION 2.6  APPLICATION OF PAYMENTS AND PREPAYMENTS.  PREPAYMENTS OF THE LOANS
SHALL BE APPLIED FIRST TO THE PRINCIPAL AMOUNT THEREOF, WITH THE BALANCE TO
ACCRUED INTEREST.  REGULARLY SCHEDULED  PAYMENTS OF THE LOANS SHALL BE APPLIED
FIRST TO ACCRUED INTEREST, THE BALANCE TO THE PRINCIPAL.  IF THE AGENT RECEIVES
FUNDS ON A DATE WHEN PAYMENTS OF THE LOANS ARE DUE AND SUCH FUNDS ARE NOT
SUFFICIENT TO PAY ALL OF THE OBLIGATIONS OF THE COMPANY HEREUNDER THEN DUE, OR
IF THE AGENT RECEIVES ANY PAYMENTS OR OTHER AMOUNTS OWING TO AGENT OR ANY LENDER
UNDER ANY LOAN DOCUMENT, INCLUDING WITHOUT LIMITATION, PROCEEDS OBTAINED FROM
THE ENFORCEMENT OF THE GUARANTIES, THEN SUCH FUNDS SHALL BE APPLIED (A) FIRST,
TO FEES OR EXPENSES OF THE AGENT THEN DUE HEREUNDER OR ANY OTHER LOAN DOCUMENT
WHICH ARE TO BE PAID BY THE COMPANY OR THE APPLICABLE GUARANTOR, (B) SECOND, TO
FEES OR EXPENSES OF THE LENDERS THEN DUE HEREUNDER OR ANY OTHER LOAN DOCUMENT
(OTHER THAN FEES OR EXPENSES OWING UNDER CREDIT FACILITY HEDGING AGREEMENTS)
WHICH ARE TO BE PAID BY THE COMPANY OR THE APPLICABLE GUARANTOR, INCLUDING
WITHOUT LIMITATION, COMMITMENT FEES TO THE EXTENT THEN DUE, (C) THIRD, TO THE
ACCRUED INTEREST ON AND, TO THE EXTENT THEN DUE, PRINCIPAL OF THE LOANS AND ANY
LETTER OF CREDIT ADVANCES THEN OUTSTANDING, AND (D) FOURTH, TO AMOUNTS OWING
UNDER CREDIT FACILITY HEDGE AGREEMENTS.  EACH PAYMENT RECEIVED BY THE AGENT
HEREUNDER OR UNDER ANY NOTE FOR THE ACCOUNT OF A LENDER SHALL BE PAID PROMPTLY
TO SUCH LENDER, IN IMMEDIATELY AVAILABLE FUNDS.  IF THE AGENT FAILS TO SEND TO
ANY LENDER THE PRODUCT OF SUCH LENDER’S CURRENT SUM PERCENTAGE TIMES THE
AGGREGATE AMOUNT OF ANY SUCH PAYMENT TIMELY RECEIVED BY THE AGENT FOR THE
ACCOUNT OF ALL THE LENDERS BY THE CLOSE OF BUSINESS ON THE BUSINESS DAY
FOLLOWING THE DATE SUCH PAYMENT WAS RECEIVED BY THE AGENT, THE AGENT SHALL PAY
TO SUCH LENDER INTEREST ON SUCH LENDER’S PRO-RATA PORTION OF SUCH PAYMENT TIMELY
RECEIVED BY THE AGENT FROM SUCH DATE OF RECEIPT BY THE AGENT TO THE DATE THAT
SUCH LENDER RECEIVES ITS PRO-RATA PORTION OF SUCH PAYMENT, SUCH INTEREST TO
ACCRUE AT THE FEDERAL FUNDS RATE AND TO BE PAYABLE UPON WRITTEN REQUEST FROM
SUCH LENDER.

 

SECTION 2.7  PRO RATA TREATMENT.  EXCEPT TO THE EXTENT OTHERWISE PROVIDED
HEREIN:  (A) EACH BORROWING FROM THE LENDERS UNDER SECTION 2.1 HEREOF SHALL BE
MADE, EACH PAYMENT OF COMMITMENT FEES SHALL BE MADE AND APPLIED FOR THE ACCOUNT
OF THE LENDERS, AND EACH TERMINATION OR REDUCTION OF THE UNUSED COMMITMENTS OF
THE LENDERS UNDER SECTION 2.2 HEREOF SHALL BE APPLIED, PRO RATA, ACCORDING TO
EACH LENDER’S COMMITMENT PERCENTAGE; (B) EACH PAYMENT BY THE COMPANY OF
PRINCIPAL OF OR INTEREST ON LOANS SHALL BE MADE TO THE AGENT FOR THE ACCOUNT OF
THE LENDERS PRO RATA IN ACCORDANCE WITH THE RESPECTIVE CURRENT SUM PERCENTAGE OF
THE LENDERS; (C) EACH LETTER OF CREDIT WILL BE ISSUED FOR THE ACCOUNT OF THE
LENDERS SEVERALLY AND RATABLY AMONG THE LENDERS IN ACCORDANCE WITH THEIR
RESPECTIVE COMMITMENT PERCENTAGES, AND (D) THE LENDERS (OTHER THAN THE
APPLICABLE ISSUER) SHALL PURCHASE FROM ANY ISSUER PARTICIPATIONS IN THE LETTERS
OF CREDIT ISSUED BY SUCH ISSUER, TO THE EXTENT OF THEIR RESPECTIVE COMMITMENT
PERCENTAGES.

 

SECTION 2.8  PAYMENT DATES ON THE LOANS.  ACCRUED INTEREST ON THE UNPAID BALANCE
OF THE LOANS SHALL BE PAYABLE ON THE INTEREST PAYMENT DATES AND AT THE MATURITY
DATE, COMMENCING WITH THE FIRST OF SUCH DATES TO OCCUR AFTER THE DATE HEREOF. 
AFTER THE MATURITY DATE, ACCRUED INTEREST ON THE LOANS SHALL BE PAYABLE ON
DEMAND.  ON THE MATURITY DATE, THE OUTSTANDING PRINCIPAL BALANCE OF THE LOANS
SHALL BE FULLY DUE AND PAYABLE.

 

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SECTION 2.9  INTEREST OPTIONS FOR LOANS.

 

(A)           OPTIONS AVAILABLE.  THE LOANS SHALL BEAR INTEREST AT THE ALTERNATE
BASE RATE; PROVIDED, THAT (1) ALL PAST DUE PRINCIPAL AND INTEREST SHALL BEAR
INTEREST AT THE PAST DUE RATE WHICH SHALL BE PAYABLE ON DEMAND, AND (2) SUBJECT
TO THE PROVISIONS HEREOF, THE COMPANY SHALL HAVE THE OPTION OF HAVING ALL OR ANY
PORTION OF THE OUTSTANDING PRINCIPAL AMOUNT OF THE LOANS BEAR INTEREST UNTIL
THEIR RESPECTIVE MATURITIES AT A RATE PER ANNUM EQUAL TO THE LIBOR RATE
(TOGETHER WITH THE ALTERNATE BASE RATE, INDIVIDUALLY HEREIN CALLED AN “INTEREST
OPTION” AND COLLECTIVELY CALLED “INTEREST OPTIONS”).  THE RECORDS OF THE AGENT
WITH RESPECT TO INTEREST OPTIONS, LIBOR INTEREST PERIODS AND THE AMOUNTS OF
LOANS TO WHICH THEY ARE APPLICABLE SHALL BE BINDING AND CONCLUSIVE, ABSENT
MANIFEST ERROR.  INTEREST ON THE LOANS SHALL BE CALCULATED AT THE ALTERNATE BASE
RATE EXCEPT WHERE IT IS EXPRESSLY PROVIDED PURSUANT TO THIS AGREEMENT THAT THE
LIBOR RATE IS TO APPLY.

 

(B)           DESIGNATION AND CONVERSION.  THE COMPANY SHALL HAVE THE RIGHT TO
DESIGNATE OR CONVERT ITS INTEREST OPTIONS IN ACCORDANCE WITH THE PROVISIONS
HEREOF.  PROVIDED NO EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING AND SUBJECT
TO THE PROVISIONS OF THE LAST SENTENCE OF SUBSECTION 2.09(A) HEREINABOVE AND OF
SECTION 2.10 HEREOF, THE COMPANY MAY ELECT TO HAVE THE LIBOR RATE APPLY OR
CONTINUE TO APPLY TO ALL OR ANY PORTION OF THE OUTSTANDING PRINCIPAL BALANCE OF
THE LOANS.  EACH CHANGE IN INTEREST OPTIONS SHALL BE A CONVERSION OF THE RATE OF
INTEREST APPLICABLE TO THE SPECIFIED PORTION OF THE LOANS, BUT SUCH CONVERSION
ALONE SHALL NOT CHANGE THE OUTSTANDING PRINCIPAL AMOUNT OF THE LOANS.  THE
INTEREST OPTIONS SHALL BE DESIGNATED OR CONVERTED IN THE MANNER PROVIDED BELOW:

 

I.              THE COMPANY SHALL GIVE THE AGENT NOTICE BY TELEPHONE OR
FACSIMILE PROMPTLY CONFIRMED BY WRITTEN NOTICE (THE “RATE SELECTION NOTICE”)
SUBSTANTIALLY IN THE FORM OF EXHIBIT E HERETO.  EACH SUCH TELEPHONE OR FACSIMILE
AND WRITTEN NOTICE SHALL SPECIFY THE AMOUNT AND TYPE OF BORROWINGS WHICH ARE THE
SUBJECT OF THE DESIGNATION, IF ANY; THE AMOUNT AND TYPE OF BORROWINGS INTO WHICH
SUCH BORROWINGS ARE TO BE CONVERTED OR FOR WHICH AN INTEREST OPTION IS
DESIGNATED; THE PROPOSED DATE FOR THE DESIGNATION OR CONVERSION (WHICH, IN THE
CASE OF CONVERSION OF LIBOR RATE BORROWINGS, SHALL BE THE LAST DAY OF THE LIBOR
INTEREST PERIOD APPLICABLE THERETO) AND THE LIBOR INTEREST PERIOD OR PERIODS, IF
ANY, SELECTED BY THE COMPANY.  SUCH NOTICE BY TELEPHONE OR FACSIMILE SHALL BE
IRREVOCABLE AND SHALL BE GIVEN TO THE AGENT NO LATER THAN THE APPLICABLE RATE
SELECTION DATE.  IF (A) A NEW LOAN IS TO BE A LIBOR RATE BORROWING, (B) AN
EXISTING LIBOR RATE BORROWING IS MATURING AT THE TIME THAT A NEW LOAN IS BEING
REQUESTED AND THE COMPANY IS ELECTING TO HAVE SUCH EXISTING PORTION OF THE
OUTSTANDING PRINCIPAL BALANCE OF THE LOANS GOING FORWARD BEAR INTEREST AT THE
SAME INTEREST OPTION AND FOR THE SAME LIBOR INTEREST PERIOD AS THE NEW LOAN, OR
(C) A PORTION OF AN ALTERNATE BASE RATE BORROWING IS TO BE CONVERTED SO AS TO
BEAR INTEREST AT THE SAME INTEREST OPTION AND FOR THE SAME LIBOR INTEREST PERIOD
AS THE NEW LOAN, THEN THE RATE SELECTION NOTICE SHALL BE INCLUDED IN THE REQUEST
FOR EXTENSION OF CREDIT AND CERTIFICATE OF NO DEFAULT APPLICABLE TO THE NEW
LOAN, WHICH SHALL BE GIVEN TO THE AGENT NO LATER THAN THE APPLICABLE RATE
SELECTION DATE.

 

II.             NO MORE THAN FIVE (5) LIBOR INTEREST PERIODS SHALL BE IN EFFECT
AT ANY ONE TIME.  EACH LIBOR RATE BORROWING SHALL BE IN THE AMOUNT OF AT LEAST
$5,000,000.

 

III.            PRINCIPAL INCLUDED IN ANY BORROWING SHALL NOT BE INCLUDED IN ANY
OTHER BORROWING WHICH EXISTS AT THE SAME TIME.

 

IV.            EACH DESIGNATION OR CONVERSION SHALL OCCUR ON A BUSINESS DAY
(AND, FOR LIBOR RATE BORROWINGS, ON A LIBOR BUSINESS DAY).

 

V.             EXCEPT AS PROVIDED IN SECTION 2.10 HEREOF, NO LIBOR RATE
BORROWING SHALL BE CONVERTED ON ANY DAY OTHER THAN THE LAST DAY OF THE
APPLICABLE LIBOR INTEREST PERIOD.

 

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(C)           COMPUTATIONS.  INTEREST BASED ON THE ALTERNATE BASE RATE, TO THE
EXTENT DETERMINED BY REFERENCE TO THE PRIME RATE, WILL BE COMPUTED ON THE BASIS
OF 365 (OR 366) DAYS AND ACTUAL DAYS ELAPSED (INCLUDING THE FIRST DAY BUT
EXCLUDING THE LAST DAY) OCCURRING IN THE PERIOD FOR WHICH PAYABLE.  ALL OTHER
INTEREST AND FEES SHALL BE COMPUTED ON THE BASIS OF A YEAR OF 360 DAYS AND
ACTUAL DAYS ELAPSED (INCLUDING THE FIRST DAY BUT EXCLUDING THE LAST DAY)
OCCURRING IN THE PERIOD FOR WHICH PAYABLE.

 

SECTION 2.10  SPECIAL PROVISIONS APPLICABLE TO LIBOR RATE BORROWINGS.

 

(A)           OPTIONS UNLAWFUL.  IF, AFTER THE DATE OF THIS AGREEMENT, THE
ADOPTION OF ANY APPLICABLE LEGAL REQUIREMENT OR ANY CHANGE IN ANY APPLICABLE
LEGAL REQUIREMENT OR IN THE INTERPRETATION OR ADMINISTRATION THEREOF BY ANY
GOVERNMENTAL AUTHORITY OR COMPLIANCE BY THE AGENT OR ANY LENDER WITH ANY REQUEST
OR DIRECTIVE (WHETHER OR NOT HAVING THE FORCE OF LAW) OF ANY GOVERNMENTAL
AUTHORITY SHALL AT ANY TIME MAKE IT UNLAWFUL OR IMPOSSIBLE FOR ANY LENDER TO
PERMIT THE ESTABLISHMENT OF OR TO MAINTAIN ANY LIBOR RATE BORROWING, THE
COMMITMENT OF THE LENDERS TO ESTABLISH OR MAINTAIN THE LIBOR RATE AFFECTED BY
SUCH ADOPTION OR CHANGE SHALL FORTHWITH BE CANCELED AND THE COMPANY SHALL
FORTHWITH, UPON DEMAND BY THE AGENT TO THE COMPANY, (1) CONVERT THE LIBOR RATE
WITH RESPECT TO WHICH SUCH DEMAND WAS MADE TO THE ALTERNATE BASE RATE; (2) PAY
ALL ACCRUED AND UNPAID INTEREST TO DATE ON THE AMOUNT SO CONVERTED; AND (3) PAY
ANY AMOUNTS REQUIRED TO COMPENSATE THE AGENT AND THE LENDERS FOR ANY ADDITIONAL
COST OR EXPENSE WHICH THE AGENT OR ANY LENDER MAY INCUR AS A RESULT OF SUCH
ADOPTION OF OR CHANGE IN SUCH LEGAL REQUIREMENT OR IN THE INTERPRETATION OR
ADMINISTRATION THEREOF AND ANY CONSEQUENTIAL LOSS WHICH THE AGENT OR ANY LENDER
MAY INCUR AS A RESULT OF SUCH CONVERSION TO THE ALTERNATE BASE RATE.  IF, WHEN
THE AGENT SO NOTIFIES THE COMPANY, THE COMPANY HAS GIVEN A RATE SELECTION NOTICE
SPECIFYING ONE OR MORE BORROWINGS OF THE TYPE WITH RESPECT TO WHICH SUCH DEMAND
WAS MADE BUT THE SELECTED LIBOR INTEREST PERIOD OR LIBOR INTEREST PERIODS HAS
NOT YET BEGUN, SUCH RATE SELECTION NOTICE SHALL BE DEEMED TO BE OF NO FORCE AND
EFFECT, AS IF NEVER MADE, AND THE BALANCE OF THE LOANS SPECIFIED IN SUCH RATE
SELECTION NOTICE SHALL BEAR INTEREST AT THE ALTERNATE BASE RATE UNTIL A
DIFFERENT AVAILABLE INTEREST OPTION SHALL BE DESIGNATED IN ACCORDANCE HEREWITH.

 

(B)           INCREASED COST OF BORROWINGS.  IF THE ADOPTION OF ANY APPLICABLE
LEGAL REQUIREMENT OR ANY CHANGE IN ANY APPLICABLE LEGAL REQUIREMENT OR IN THE
INTERPRETATION OR ADMINISTRATION THEREOF BY ANY GOVERNMENTAL AUTHORITY OR
COMPLIANCE BY THE AGENT OR ANY LENDER WITH ANY REQUEST OR DIRECTIVE (WHETHER OR
NOT HAVING THE FORCE OF LAW) FROM ANY GOVERNMENTAL AUTHORITY SHALL AT ANY TIME
AS A RESULT OF ANY PORTION OF THE PRINCIPAL BALANCE OF THE LOANS BEING
MAINTAINED ON THE BASIS OF THE LIBOR RATE:

 

I.              SUBJECT ANY LENDER (OR MAKE IT APPARENT THAT ANY LENDER IS
SUBJECT) TO ANY TAX (INCLUDING ANY UNITED STATES INTEREST EQUALIZATION TAX),
LEVY, IMPOST, DUTY, CHARGE, FEE (COLLECTIVELY, “TAXES”), OR ANY DEDUCTION OR
WITHHOLDING FOR ANY TAXES ON OR FROM THE PAYMENT DUE UNDER ANY LIBOR RATE
BORROWING OR OTHER AMOUNTS DUE HEREUNDER, OTHER THAN INCOME AND FRANCHISE TAXES
OF THE UNITED STATES AND ITS POLITICAL SUBDIVISIONS; OR

 

II.             CHANGE THE BASIS OF TAXATION OF PAYMENTS DUE FROM THE COMPANY TO
THE AGENT OR ANY LENDER UNDER ANY LIBOR RATE BORROWING (OTHERWISE THAN BY A
CHANGE IN THE RATE OF TAXATION OF THE OVERALL NET INCOME OF THE AGENT OR ANY
LENDER); OR

 

III.            IMPOSE, MODIFY, INCREASE OR DEEM APPLICABLE ANY RESERVE
REQUIREMENT (EXCLUDING THAT PORTION OF ANY RESERVE REQUIREMENT INCLUDED IN THE
CALCULATION OF THE EUROCURRENCY RESERVE REQUIREMENT, SPECIAL DEPOSIT REQUIREMENT
OR SIMILAR REQUIREMENT (INCLUDING STATE LAW REQUIREMENTS AND REGULATION D)
IMPOSED, MODIFIED, INCREASED OR DEEMED APPLICABLE BY ANY GOVERNMENTAL AUTHORITY
AGAINST ASSETS HELD BY THE AGENT OR ANY LENDER, OR AGAINST DEPOSITS OR ACCOUNTS
IN OR FOR THE ACCOUNT OF THE AGENT OR

 

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ANY LENDER, OR AGAINST LOANS MADE BY THE AGENT OR ANY LENDER, OR AGAINST ANY
OTHER FUNDS, OBLIGATIONS OR OTHER PROPERTY OWNED OR HELD BY THE AGENT OR ANY
LENDER; OR

 

IV.            IMPOSE ON THE AGENT OR ANY LENDER ANY OTHER CONDITION REGARDING
ANY LIBOR RATE BORROWING;

 

and the result of any of the foregoing is to increase the cost to any Lender of
agreeing to make or of making, renewing or maintaining such borrowing on the
basis of the LIBOR Rate, or reduce the amount of principal or interest received
by any Lender, then, upon demand by the Agent, the Company shall pay to the
Agent, from time to time as specified by the Agent, additional amounts which
shall compensate such Lender for such increased cost or reduced amount.  The
Agent will promptly notify the Company in writing of any event, upon becoming
actually aware of it, which will entitle any Lender to additional amounts
pursuant to this paragraph.  The Agent’s determination of the amount of any such
increased cost, increased reserve requirement or reduced amount shall be
conclusive and binding, absent manifest error, provided that the calculation
thereof is set forth in reasonable detail in such notice.

 

The Company shall have the right, if it receives from the Agent any notice
referred to in the preceding paragraph, upon three (3) Business Days’ notice to
the Agent, either (i) to repay in full (but not in part) any borrowing with
respect to which such notice was given, together with any accrued interest
thereon, or (ii) to convert the LIBOR Rate in effect with respect to such
borrowing to the Alternate Base Rate; provided, that any such repayment or
conversion shall be accompanied by payment of (x) the amount required to
compensate the appropriate Lender or Lenders for the increased cost or reduced
amount referred to in the preceding paragraph; (y) all accrued and unpaid
interest to date on the amount so repaid or converted, and (z) any Consequential
Loss which may be incurred as a result of such repayment or conversion.

 

(C)           INADEQUACY OF PRICING AND RATE DETERMINATION.  IF FOR ANY REASON
WITH RESPECT TO ANY LIBOR INTEREST PERIOD THE AGENT SHALL HAVE DETERMINED (WHICH
DETERMINATION SHALL BE CONCLUSIVE AND BINDING UPON THE COMPANY, AND, IN THE CASE
OF CLAUSE (2) BELOW, SHALL BE PRESUMED TO BE MADE UPON NOTICE FROM SUCH LENDER)
THAT:  (1) THE AGENT IS UNABLE THROUGH ITS CUSTOMARY GENERAL PRACTICES TO
DETERMINE A RATE AT WHICH THE AGENT IS OFFERED DEPOSITS IN UNITED STATES DOLLARS
BY PRIME BANKS IN THE INTERBANK MARKET IN LONDON, ENGLAND IN THE APPROPRIATE
AMOUNT FOR THE APPROPRIATE PERIOD, OR BY REASON OF CIRCUMSTANCES AFFECTING THE
INTERBANK MARKET IN LONDON, ENGLAND, GENERALLY, PRIME BANKS ARE NOT BEING
OFFERED DEPOSITS IN UNITED STATES DOLLARS IN THE INTERBANK MARKET IN LONDON,
ENGLAND, FOR THE APPLICABLE LIBOR INTEREST PERIOD AND IN AN AMOUNT EQUAL TO THE
AMOUNT OF THE LIBOR RATE BORROWING REQUESTED BY THE COMPANY, OR (2) THE LIBOR
RATE WILL NOT ADEQUATELY AND FAIRLY REFLECT THE COST TO ANY LENDER OF MAKING AND
MAINTAINING ANY LIBOR RATE BORROWING HEREUNDER FOR ANY PROPOSED LIBOR INTEREST
PERIOD, THEN THE AGENT SHALL GIVE THE COMPANY NOTICE THEREOF AND THEREUPON,
(A) ANY RATE SELECTION NOTICE PREVIOUSLY GIVEN BY THE COMPANY DESIGNATING A
LIBOR RATE WHICH HAS NOT COMMENCED AS OF THE DATE OF SUCH NOTICE FROM THE AGENT
SHALL BE DEEMED FOR ALL PURPOSES HEREOF TO BE OF NO FORCE AND EFFECT, AS IF
NEVER GIVEN, AND (B) UNTIL THE AGENT SHALL NOTIFY THE COMPANY THAT THE
CIRCUMSTANCES GIVING RISE TO SUCH NOTICE FROM THE AGENT NO LONGER EXIST, EACH
RATE SELECTION NOTICE REQUESTING A LIBOR RATE BORROWING SHALL BE DEEMED A
REQUEST FOR AN ALTERNATE BASE RATE BORROWING, AND EACH OUTSTANDING LIBOR RATE
BORROWING THEN IN EFFECT SHALL BE CONVERTED, WITHOUT ANY NOTICE TO OR FROM THE
COMPANY, UPON THE TERMINATION OF THE LIBOR INTEREST PERIOD THEN IN EFFECT, TO AN
ALTERNATE BASE RATE BORROWING.

 

(D)           INDEMNIFICATION.  THE COMPANY SHALL INDEMNIFY THE AGENT AND EACH
OF THE LENDERS AGAINST AND HOLD EACH OF THEM HARMLESS FROM ANY LOSS OR EXPENSE
WHICH THEY MAY INCUR OR SUSTAIN AS A CONSEQUENCE OF ANY UNTIMELY PAYMENT
(MANDATORY OR OPTIONAL) OR DEFAULT BY THE COMPANY IN THE PAYMENT OF ANY
PRINCIPAL AMOUNT OF OR INTEREST ON THE LOANS, OR ANY FAILURE BY THE COMPANY TO
CONVERT OR TO BORROW ANY LIBOR RATE BORROWING ON THE DATE SPECIFIED BY THE
COMPANY, IN EACH CASE INCLUDING ANY

 

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INTEREST PAYABLE BY ANY LENDER TO THE LENDERS OF THE FUNDS OBTAINED BY IT IN
ORDER TO MAKE OR MAINTAIN ANY LIBOR RATE BORROWING (OR ANY PORTION THEREOF),
AND, TO THE EXTENT NOT COVERED ABOVE, ANY CONSEQUENTIAL LOSS.  THIS AGREEMENT
SHALL SURVIVE THE PAYMENT OF THE LOANS.  A CERTIFICATE AS TO ANY ADDITIONAL
AMOUNTS PAYABLE PURSUANT TO THIS PARAGRAPH SUBMITTED BY THE AGENT OR ANY LENDER
TO THE COMPANY SHALL BE CONCLUSIVE AND BINDING UPON THE COMPANY, ABSENT MANIFEST
ERROR, PROVIDED THE CALCULATION THEREOF IS SET FORTH IN REASONABLE DETAIL IN
SUCH NOTICE.

 

SECTION 2.11  PAYMENT DATES.  WHENEVER ANY PAYMENT TO BE MADE HEREUNDER IN
RESPECT OF THE LOANS SHALL BE STATED TO BE DUE ON A DAY WHICH IS NEITHER A
BUSINESS DAY NOR A LIBOR BUSINESS DAY, SUCH PAYMENT MAY BE MADE ON THE NEXT
SUCCEEDING BUSINESS DAY, OR, SUBJECT TO THE DEFINITION OF LIBOR INTEREST PERIOD
IN THE CASE OF ANY PAYMENT OF THE LOANS TO WHICH THE LIBOR RATE APPLIES, ON THE
NEXT SUCCEEDING LIBOR BUSINESS DAY, AND SUCH EXTENSION OF TIME SHALL IN EACH
SUCH CASE BE INCLUDED IN COMPUTING INTEREST AND COMMITMENT FEES IN CONNECTION
WITH SUCH PAYMENT.

 

SECTION 2.12  SHARING OF PAYMENTS, ETC.  THE COMPANY AGREES THAT, IN ADDITION TO
(AND WITHOUT LIMITATION OF) ANY RIGHT OF SET-OFF, BANKERS’ LIEN OR COUNTERCLAIM
A LENDER MAY OTHERWISE HAVE, UPON THE OCCURRENCE AND DURING THE CONTINUANCE OF
ANY EVENT OF DEFAULT, EACH LENDER SHALL BE ENTITLED, AT ITS OPTION, TO OFFSET
BALANCES HELD BY IT FOR THE ACCOUNT OF THE COMPANY AT ANY OF ITS OFFICES AGAINST
ANY PRINCIPAL OF OR INTEREST ON ANY OF SUCH LENDER’S LOANS TO THE COMPANY
HEREUNDER, SUCH LENDER’S COMMITMENT PERCENTAGE OF THE LETTER OF CREDIT EXPOSURE
AMOUNT OR ANY OTHER OBLIGATION OF THE COMPANY HEREUNDER, WHICH IS NOT PAID
(REGARDLESS OF WHETHER SUCH BALANCES ARE THEN DUE TO THE COMPANY), IN WHICH CASE
IT SHALL PROMPTLY NOTIFY THE COMPANY AND THE AGENT THEREOF, PROVIDED THAT SUCH
LENDER’S FAILURE TO GIVE SUCH NOTICE SHALL NOT AFFECT THE VALIDITY THEREOF.  IF
A LENDER SHALL OBTAIN PAYMENT OF ANY PRINCIPAL OF OR INTEREST ON ANY LOAN MADE
BY IT UNDER THIS AGREEMENT, ANY LETTER OF CREDIT EXPOSURE AMOUNT OR OTHER
OBLIGATION THEN DUE TO SUCH LENDER HEREUNDER, THROUGH THE EXERCISE OF ANY RIGHT
OF SET-OFF (INCLUDING, WITHOUT LIMITATION, ANY RIGHT OF SETOFF OR LIEN GRANTED
UNDER SECTION 9.18 HEREOF), BANKER’S LIEN, COUNTERCLAIM OR SIMILAR RIGHT, OR
OTHERWISE, IT SHALL PROMPTLY PURCHASE FROM THE OTHER LENDERS PARTICIPATIONS IN
THE LOANS MADE BY, THE LETTER OF CREDIT EXPOSURE AMOUNT OF, OR THE OTHER
OBLIGATIONS OF THE COMPANY HEREUNDER OF, THE OTHER LENDERS IN SUCH AMOUNTS, AND
MAKE SUCH OTHER ADJUSTMENTS FROM TIME TO TIME AS SHALL BE EQUITABLE TO THE END
THAT ALL THE LENDERS SHALL SHARE THE BENEFIT OF SUCH PAYMENT (NET OF ANY
EXPENSES WHICH MAY BE INCURRED BY SUCH LENDER IN OBTAINING OR PRESERVING SUCH
BENEFIT) PRO RATA IN ACCORDANCE WITH THEIR RESPECTIVE COMMITMENT PERCENTAGES. 
TO SUCH END ALL THE LENDERS SHALL MAKE APPROPRIATE ADJUSTMENTS AMONG THEMSELVES
(BY THE RESALE OF PARTICIPATIONS SOLD OR OTHERWISE) IF SUCH PAYMENT IS RESCINDED
OR MUST OTHERWISE BE RESTORED.  THE COMPANY AGREES, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, THAT ANY LENDER SO PURCHASING A
PARTICIPATION IN THE LOANS MADE BY, LETTER OF CREDIT EXPOSURE AMOUNT OF, OR
OTHER OBLIGATIONS HEREUNDER OF, THE OTHER LENDERS MAY EXERCISE, UPON THE
OCCURRENCE AND DURING THE CONTINUANCE OF ANY EVENT OF DEFAULT, ALL RIGHTS OF
SET-OFF, BANKERS’ LIEN, COUNTERCLAIM OR SIMILAR RIGHTS WITH RESPECT TO SUCH
PARTICIPATION AS FULLY AS IF SUCH LENDER WERE A DIRECT HOLDER OF SAID LOANS,
LETTER OF CREDIT EXPOSURE AMOUNT OR OTHER OBLIGATIONS IN THE AMOUNT OF SUCH
PARTICIPATION.  NOTHING CONTAINED HEREIN SHALL REQUIRE ANY LENDER TO EXERCISE
ANY SUCH RIGHT OR SHALL AFFECT THE RIGHT OF ANY LENDER TO EXERCISE, AND RETAIN
THE BENEFITS OF EXERCISING, ANY SUCH RIGHT WITH RESPECT TO ANY OTHER
INDEBTEDNESS OR OBLIGATION OF THE COMPANY.

 

SECTION 2.13  USE OF PROCEEDS.  THE PROCEEDS OF THE LOANS SHALL BE USED SOLELY
(I) TO FINANCE THE TRANSACTIONS, (II) TO REFINANCE CERTAIN EXISTING INDEBTEDNESS
OF THE TARGET, (C) TO PAY COSTS AND EXPENSES RELATING TO THE TRANSACTIONS, AND
(D) TO SUPPORT NEW STORE DEVELOPMENT, OTHER ACQUISITIONS, THE ISSUANCE OF
STANDBY LETTERS OF CREDIT AND OTHER GENERAL CORPORATE PURPOSES, INCLUDING BUT
NOT LIMITED TO, THE REPURCHASE OF STOCK.

 

SECTION 2.14  EVIDENCE OF DEBT.  (A)  EACH LENDER SHALL MAINTAIN IN ACCORDANCE
WITH ITS USUAL PRACTICE AN ACCOUNT OR ACCOUNTS EVIDENCING THE INDEBTEDNESS OF
THE COMPANY TO SUCH LENDER

 

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RESULTING FROM EACH LOAN OWING TO SUCH LENDER FROM TIME TO TIME, INCLUDING THE
AMOUNTS OF PRINCIPAL AND INTEREST PAYABLE AND PAID TO SUCH LENDER FROM TIME TO
TIME HEREUNDER.  THE COMPANY AGREES THAT UPON NOTICE BY ANY LENDER TO THE
COMPANY (WITH A COPY OF SUCH NOTICE TO THE AGENT) TO THE EFFECT THAT A NOTE OR
OTHER EVIDENCE OF INDEBTEDNESS IS REQUIRED OR APPROPRIATE IN ORDER FOR SUCH
LENDER TO EVIDENCE (WHETHER FOR PURPOSES OF ENFORCEMENT OR OTHERWISE) THE LOANS
OWING TO, OR TO BE MADE BY, SUCH LENDER, THE COMPANY SHALL PROMPTLY EXECUTE AND
DELIVER TO SUCH LENDER PARTY, WITH A COPY TO THE AGENT, A NOTE, IN SUBSTANTIALLY
THE FORM OF EXHIBIT A HERETO, PAYABLE TO THE ORDER OF SUCH LENDER IN A PRINCIPAL
AMOUNT EQUAL TO THE COMMITMENT OF SUCH LENDER.  ALL REFERENCES TO NOTES IN THE
LOAN DOCUMENTS SHALL MEAN NOTES, IF ANY, TO THE EXTENT ISSUED HEREUNDER.

 

(B)           THE REGISTER MAINTAINED BY THE AGENT PURSUANT TO
SECTION 9.11(E) SHALL INCLUDE A CONTROL ACCOUNT, AND A SUBSIDIARY ACCOUNT FOR
EACH LENDER, IN WHICH ACCOUNTS (TAKEN TOGETHER) SHALL BE RECORDED (I) THE DATE
AND AMOUNT OF EACH BORROWING MADE HEREUNDER, THE TYPE OF LOANS COMPRISING SUCH
BORROWING AND, IF APPROPRIATE, THE LIBOR INTEREST PERIOD APPLICABLE THERETO,
(II) THE TERMS OF EACH ASSIGNMENT AND ACCEPTANCE DELIVERED TO AND ACCEPTED BY
IT, (III) THE AMOUNT OF ANY PRINCIPAL OR INTEREST DUE AND PAYABLE OR TO BECOME
DUE AND PAYABLE FROM THE BORROWER TO EACH LENDER HEREUNDER, AND (IV) THE AMOUNT
OF ANY SUM RECEIVED BY THE AGENT FROM THE BORROWER HEREUNDER AND EACH LENDER’S
SHARE THEREOF.

 

(C)           ENTRIES MADE IN GOOD FAITH BY THE AGENT IN THE REGISTER PURSUANT
TO SUBSECTION (B) ABOVE, AND BY EACH LENDER IN ITS ACCOUNT OR ACCOUNTS PURSUANT
TO SUBSECTION (A) ABOVE, SHALL BE PRIMA FACIE EVIDENCE OF THE AMOUNT OF
PRINCIPAL AND INTEREST DUE AND PAYABLE OR TO BECOME DUE AND PAYABLE FROM THE
COMPANY TO, IN THE CASE OF THE REGISTER, EACH LENDER AND, IN THE CASE OF SUCH
ACCOUNT OR ACCOUNTS, SUCH LENDER, UNDER THIS AGREEMENT, ABSENT MANIFEST ERROR;
PROVIDED, HOWEVER, THAT THE FAILURE OF THE AGENT OR SUCH LENDER TO MAKE AN
ENTRY, OR ANY FINDING THAT AN ENTRY IS INCORRECT, IN THE REGISTER OR SUCH
ACCOUNT OR ACCOUNTS SHALL NOT LIMIT OR OTHERWISE AFFECT THE OBLIGATIONS OF THE
BORROWER UNDER THIS AGREEMENT.

 

SECTION 2.15  LETTERS OF CREDIT.

 

(A)           SUBJECT TO THE TERMS AND CONDITIONS CONTAINED HEREIN, THE COMPANY
SHALL HAVE THE RIGHT TO UTILIZE THE AGGREGATE COMMITMENT FROM TIME TO TIME PRIOR
TO THE LETTER OF CREDIT TERMINATION DATE, BY OBTAINING FROM ANY ISSUER ONE OR
MORE LETTERS OF CREDIT FOR THE ACCOUNT OF THE COMPANY OR ANY OF ITS SUBSIDIARIES
(WITH THE COMPANY BEING JOINTLY AND SEVERALLY LIABLE UNDER THE TERMS OF THE
APPLICABLE APPLICATION FOR ANY LETTER OF CREDIT ISSUED FOR THE ACCOUNT OF ANY OF
THE COMPANY’S SUBSIDIARIES) IN SUCH AMOUNTS AND IN FAVOR OF SUCH BENEFICIARIES
AS THE COMPANY FROM TIME TO TIME SHALL REQUEST; PROVIDED, THAT IN NO EVENT SHALL
ANY ISSUER HAVE ANY OBLIGATION TO ISSUE ANY LETTER OF CREDIT IF (I) THE FACE
AMOUNT OF SUCH LETTER OF CREDIT PLUS THE LETTER OF CREDIT EXPOSURE AMOUNT AT
SUCH TIME WOULD EXCEED $200,000,000, (II) THE FACE AMOUNT OF SUCH LETTER OF
CREDIT PLUS THE AGGREGATE OF EACH LENDER’S CURRENT SUM AT SUCH TIME, WOULD
EXCEED THE AGGREGATE COMMITMENT, (III) SUCH LETTER OF CREDIT WOULD HAVE AN
EXPIRY DATE LATER THAN THE MATURITY DATE, (IV) EITHER SUCH LETTER OF CREDIT IS
NOT IN SUCH FORM AND DOES NOT CONTAIN SUCH TERMS AS SHALL BE SATISFACTORY TO THE
AGENT IN ITS SOLE AND ABSOLUTE DISCRETION OR THE COMPANY HAS NOT EXECUTED AND
DELIVERED SUCH APPLICATIONS AND OTHER INSTRUMENTS AND AGREEMENTS RELATING TO
SUCH LETTER OF CREDIT AS THE AGENT SHALL HAVE REQUESTED OR (V) AN EVENT HAS
OCCURRED AND IS CONTINUING WHICH CONSTITUTES A DEFAULT AS PROVIDED IN SECTION 7
OF THIS AGREEMENT.  THE COMPANY PROMISES TO PAY TO THE ORDER OF AN ISSUER THE
AMOUNT OF ALL LETTER OF CREDIT ADVANCES MADE BY SUCH ISSUER, TOGETHER WITH
ACCRUED INTEREST THEREON (IF ANY).  EACH LETTER OF CREDIT ADVANCE SHALL BE
CONSIDERED FOR ALL PURPOSES AS A DEMAND OBLIGATION OWING BY THE COMPANY TO THE
APPLICABLE ISSUER OF THE LETTER OF CREDIT TO WHICH IT RELATES, AND EACH LETTER
OF CREDIT ADVANCE SHALL BEAR INTEREST FROM THE DATE THEREOF AT THE PAST DUE
RATE, WITHOUT NOTICE OF PRESENTMENT, DEMAND, PROTEST OR OTHER FORMALITIES OF ANY
KIND (SAID PAST DUE INTEREST ON SUCH LETTER OF CREDIT ADVANCE BEING PAYABLE ON
DEMAND).  TO EFFECT REPAYMENT OF ANY SUCH LETTER OF CREDIT ADVANCE AND ANY
INTEREST ACCRUED THEREON, THE AGENT MAY, BUT SHALL NOT BE OBLIGATED TO, AT ANY
TIME DEEM THAT THE

 

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COMPANY HAS REQUESTED AN ADDITIONAL LOAN AS AN ALTERNATE BASE RATE BORROWING
UNDER THIS AGREEMENT TO BE MADE TO SATISFY SUCH LETTER OF CREDIT ADVANCE AND ANY
INTEREST ACCRUED THEREON (IF ANY), AND IF THE AGENT DEEMS THAT THE COMPANY HAS
REQUESTED AN ADDITIONAL LOAN AS AN ALTERNATE BASE RATE BORROWING TO BE MADE
UNDER THIS AGREEMENT TO SATISFY SUCH LETTER OF CREDIT ADVANCE AND ANY INTEREST
ACCRUED THEREON (IF ANY), THE LENDERS SHALL SATISFY SUCH LETTER OF CREDIT
ADVANCE AND ANY INTEREST ACCRUED THEREON (IF ANY) BY (SUBJECT TO THE TERMS AND
CONDITIONS OF SECTION 2.1 HEREOF) MAKING AN ADDITIONAL LOAN AS AN ALTERNATE BASE
RATE BORROWING  UNDER THIS AGREEMENT, IF SUCH LETTER OF CREDIT ADVANCE IS (AND
SUCH LOAN IS TO BE) MADE PRIOR TO THE MATURITY DATE.  EACH ISSUER WILL PAY TO
EACH LENDER SUCH LENDER’S COMMITMENT PERCENTAGE OF ALL AMOUNTS RECEIVED FROM THE
COMPANY BY SUCH ISSUER, IF ANY, FOR APPLICATION, IN WHOLE OR IN PART, AGAINST
THE LETTER OF CREDIT ADVANCES OR LOANS MADE BY SUCH LENDER IN RESPECT TO ANY
LETTER OF CREDIT, BUT ONLY TO THE EXTENT SUCH LENDER HAS MADE ITS FULL PRO RATA
PAYMENT OF EACH DRAWING UNDER THE LETTER OF CREDIT TO WHICH SUCH LETTER OF
CREDIT ADVANCE RELATES.  ALL RIGHTS, POWERS, BENEFITS AND PRIVILEGES OF THIS
AGREEMENT WITH RESPECT TO THE LOANS, ALL SECURITY THEREFOR AND GUARANTIES
THEREOF (INCLUDING THE GUARANTIES) AND ALL RESTRICTIONS, PROVISIONS FOR
REPAYMENT OR ACCELERATION AND ALL OTHER COVENANTS, WARRANTIES, REPRESENTATIONS
AND AGREEMENTS OF THE COMPANY CONTAINED IN THIS AGREEMENT WITH RESPECT TO THE
LOANS SHALL APPLY TO EACH SUCH LETTER OF CREDIT ADVANCE.

 

(B)           IN CONSIDERATION OF THE ISSUANCE OF EACH LETTER OF CREDIT PURSUANT
TO THE PROVISIONS OF THIS SECTION 2.15, THE COMPANY AGREES TO PAY TO THE
APPLICABLE ISSUER A LETTER OF CREDIT FEE IN ARREARS ON EACH LETTER OF CREDIT FEE
PAYMENT DATE EQUAL TO THE PRODUCT OF (A) THE APPLICABLE MARGIN THEN IN EFFECT
FOR LIBOR RATE BORROWINGS TIMES (B) THE AMOUNT AVAILABLE FOR DRAWINGS UNDER SUCH
LETTER OF CREDIT ISSUED BY SUCH ISSUER ON SUCH LETTER OF CREDIT FEE PAYMENT DATE
TIMES (C) THE NUMBER OF DAYS FROM, BUT NOT INCLUDING, SUCH LETTER OF CREDIT FEE
PAYMENT DATE THROUGH AND INCLUDING THE NEXT TO OCCUR LETTER OF CREDIT FEE
PAYMENT DATE (OR EXPIRY DATE, IF SOONER) APPLICABLE TO SUCH LETTER OF CREDIT
DIVIDED BY 360; PROVIDED, THAT IN NO EVENT SHALL THE FEE TO BE PAID ON ANY
LETTER OF CREDIT FEE PAYMENT DATE FOR ANY SUCH LETTER OF CREDIT EVER BE LESS
THAN $500.  IN ADDITION, WITH RESPECT TO EACH LETTER OF CREDIT, THE COMPANY
SHALL PAY TO THE APPLICABLE ISSUER, FOR THE BENEFIT OF SUCH ISSUER ONLY, A
FRONTING FEE, IN ADVANCE, ON SUCH LETTER OF CREDIT, WHICH SHALL BE DUE AND
PAYABLE ON EACH LETTER OF CREDIT FEE PAYMENT DATE.  THE FRONTING FEE AMOUNT SO
PAYABLE SHALL BE EQUAL TO THE PRODUCT OF (A) ONE-EIGHTH OF ONE PERCENT (1/8%)
TIMES (B) THE AMOUNT AVAILABLE FOR DRAWINGS UNDER SUCH LETTER OF CREDIT ON SUCH
LETTER OF CREDIT FEE PAYMENT DATE TIMES (C) THE NUMBER OF DAYS FROM, BUT NOT
INCLUDING, SUCH LETTER OF CREDIT FEE PAYMENT DATE THROUGH AND INCLUDING THE NEXT
TO OCCUR LETTER OF CREDIT FEE PAYMENT DATE (OR EXPIRY DATE, IF SOONER)
APPLICABLE TO SUCH LETTER OF CREDIT DIVIDED BY 360.

 

(C)           EACH ISSUER WILL PAY TO EACH LENDER, AS SOON AS PRACTICABLE AFTER
RECEIVING ANY PAYMENT OF LETTER OF CREDIT FEES (OTHER THAN ANY FRONTING FEE
PAYABLE ONLY FOR THE BENEFIT OF SUCH ISSUER), AN AMOUNT EQUAL TO THE PRODUCT OF
(A) SUCH LENDER’S COMMITMENT PERCENTAGE TIMES (B) THE AMOUNT OF SUCH FEES
RECEIVED (OTHER THAN ANY FRONTING FEE PAYABLE ONLY FOR THE BENEFIT OF SUCH
ISSUER).  IF ANY ISSUER FAILS TO SEND TO ANY LENDER SUCH LENDER’S PRO-RATA
PORTION OF ANY PAYMENT OF LETTER OF CREDIT FEES TIMELY RECEIVED BY SUCH ISSUER
HEREUNDER BY THE CLOSE OF BUSINESS ON THE BUSINESS DAY SUCH PAYMENT WAS RECEIVED
BY SUCH ISSUER, SUCH ISSUER SHALL PAY TO SUCH LENDER INTEREST ON SUCH LENDER’S
PRO-RATA PORTION OF THE LETTER OF CREDIT FEES TIMELY RECEIVED BY SUCH ISSUER
FROM SUCH DATE OF RECEIPT BY SUCH ISSUER TO THE DATE THAT SUCH LENDER RECEIVES
ITS PRO-RATA PORTION OF SUCH PAYMENT, SUCH INTEREST TO ACCRUE AT THE FEDERAL
FUNDS RATE AND TO BE PAYABLE UPON WRITTEN REQUEST FROM SUCH LENDER.  THE
OBLIGATIONS OF THE COMPANY UNDER THIS AGREEMENT IN RESPECT OF THE LETTERS OF
CREDIT AND LETTER OF CREDIT ADVANCES SHALL BE ABSOLUTE, UNCONDITIONAL AND
IRREVOCABLE, AND SHALL BE PAID STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS
AGREEMENT, UNDER ALL CIRCUMSTANCES WHATSOEVER, INCLUDING THE FOLLOWING
CIRCUMSTANCES:

 

(1)           ANY LACK OF VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT, ANY
LETTER OF CREDIT OR ANY LOAN DOCUMENT;

 

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(2)           ANY AMENDMENT OR WAIVER OF DEFAULT UNDER OR ANY CONSENT TO
DEPARTURE FROM THE TERMS OF THIS AGREEMENT OR ANY LETTER OF CREDIT WITHOUT THE
EXPRESS PRIOR WRITTEN CONSENT OF THE AGENT AND THE ISSUER OF SUCH LETTER OF
CREDIT;

 

(3)           THE EXISTENCE OF ANY CLAIM, SET-OFF, DEFENSE OR OTHER RIGHT WHICH
ANY BENEFICIARY OR ANY TRANSFEREE OF ANY LETTER OF CREDIT (OR ANY ENTITIES FOR
WHOM ANY SUCH BENEFICIARY OR ANY SUCH TRANSFEREE MAY BE ACTING), OR ANY PERSON
(OTHER THAN THE AGENT OR THE LENDERS) MAY HAVE, WHETHER IN CONNECTION WITH THIS
AGREEMENT, THE LETTERS OF CREDIT, THE TRANSACTIONS CONTEMPLATED HEREBY OR ANY
UNRELATED TRANSACTION;

 

(4)           ANY STATEMENT, DRAFT, CERTIFICATE, OR ANY OTHER DOCUMENT PRESENTED
UNDER ANY LETTER OF CREDIT PROVING TO BE FORGED, FRAUDULENT, INVALID OR
INSUFFICIENT IN ANY RESPECT OR ANY STATEMENT THEREIN BEING UNTRUE OR INACCURATE
IN ANY RESPECT WHATSOEVER; PROVIDED THAT EACH ISSUER WILL EXAMINE EACH DOCUMENT
PRESENTED UNDER EACH LETTER OF CREDIT ISSUED BY SUCH ISSUER TO ASCERTAIN THAT
SUCH DOCUMENT APPEARS ON ITS FACE TO COMPLY WITH THE TERMS THEREOF; AND

 

(5)           ANY OTHER CIRCUMSTANCE OR HAPPENING WHATSOEVER, WHETHER OR NOT
SIMILAR TO ANY OF THE FOREGOING.

 

In the event that any restriction or limitation is imposed upon or determined or
held to be applicable to the Agent, any Lender, any Issuer or the Company by,
under or pursuant to any Legal Requirement now or hereafter in effect or by
reason of any interpretation thereof by any Governmental Authority, which in the
respective sole judgment of the Agent, any Lender or any Issuer would prevent
any Lender or Issuer from legally incurring liability under a Letter of Credit
issued or proposed to be issued hereunder, then the Agent shall give prompt
written notice thereof to the Company, whereupon the Lenders and the Issuers
shall have no obligation to issue any additional Letters of Credit then or at
any time thereafter.  In addition, if as a result of any Regulatory Change which
imposes, modifies or deems applicable (x) any tax, reserve, special deposit or
similar requirement against letters of credit issued by any Issuer or
participated in by any Lender; (y) any fee, expense or assessment against
Letters of Credit issued by any Issuer, the Agent or any Lender for deposit
insurance, or (z) any other charge, expense or condition which increases the
actual cost to any Issuer, the Agent or any Lender of issuing or maintaining the
Letters of Credit, or reduces any amount receivable by the Agent, any Lender or
any Issuer hereunder in respect of any Letter of Credit or any participation
therein (which increase in cost, or reduction in amount receivable, shall be the
result of such Issuer’s, the Agent’s or such Lender’s reasonable allocation of
the aggregate of such increases or reductions resulting from such event), then
the Company shall pay to such Issuer, the Agent or such Lender, upon demand and
from time to time, amounts sufficient to compensate such Person for each such
increase from the effective date of such increase to the date of demand
therefor.  Each such demand shall be accompanied by a certificate setting forth
in reasonable detail the calculation of the amount then being demanded in
accordance with the preceding sentence and each such certificate shall be
conclusive absent manifest error.

 

(D)           THE COMPANY HEREBY INDEMNIFIES AND HOLDS HARMLESS EACH ISSUER,
EACH LENDER AND THE AGENT FROM AND AGAINST ANY AND ALL CLAIMS AND DAMAGES,
LOSSES, LIABILITIES, COSTS OR EXPENSES WHICH SUCH ISSUER, SUCH LENDER OR THE
AGENT MAY INCUR (OR WHICH MAY BE CLAIMED AGAINST SUCH ISSUER, SUCH LENDER OR THE
AGENT BY ANY PERSON WHATSOEVER) IN CONNECTION WITH THE EXECUTION AND DELIVERY OR
TRANSFER OF OR PAYMENT OR FAILURE TO PAY UNDER ANY LETTER OF CREDIT, INCLUDING
ANY CLAIMS, DAMAGES, LOSSES, LIABILITIES, COSTS OR EXPENSES WHICH SUCH ISSUER,
THE AGENT OR SUCH LENDER, AS THE CASE MAY BE, MAY INCUR (WHETHER INCURRED AS A
RESULT OF ITS OWN NEGLIGENCE OR OTHERWISE) BY REASON OF OR IN CONNECTION WITH
THE FAILURE OF

 

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ANY OTHER LENDER (WHETHER AS A RESULT OF ITS OWN NEGLIGENCE OR OTHERWISE) TO
FULFILL OR COMPLY WITH ITS OBLIGATIONS TO SUCH ISSUER, THE AGENT OR SUCH LENDER,
AS THE CASE MAY BE, HEREUNDER (BUT NOTHING HEREIN CONTAINED SHALL AFFECT ANY
RIGHTS THE COMPANY MAY HAVE AGAINST SUCH DEFAULTING LENDER); PROVIDED, THAT THE
COMPANY SHALL NOT BE REQUIRED TO INDEMNIFY ANY ISSUER, ANY LENDER OR THE AGENT
FOR ANY CLAIMS, DAMAGES, LOSSES, LIABILITIES, COSTS OR EXPENSES TO THE EXTENT,
BUT ONLY TO THE EXTENT, CAUSED BY (I) THE WILLFUL MISCONDUCT OR GROSS NEGLIGENCE
OF THE PARTY SEEKING INDEMNIFICATION OR (II) SUCH ISSUER’S, SUCH LENDER’S OR THE
AGENT’S (AS THE CASE MAY BE) FAILURE TO PAY UNDER ANY LETTER OF CREDIT AFTER THE
PRESENTATION TO IT OF A REQUEST REQUIRED TO BE PAID UNDER APPLICABLE LAW. 
NOTHING IN THIS SECTION 2.4(C) IS INTENDED TO LIMIT THE OBLIGATIONS OF THE
COMPANY UNDER ANY OTHER PROVISION OF THIS AGREEMENT.

 

(E)           THE COMPANY SHALL GIVE THE AGENT THE APPLICATION FOR A LETTER OF
CREDIT IN ACCORDANCE WITH THE TERMS OF SECTION 3.1 HEREOF.  UPON RECEIPT OF ANY
SUCH APPLICATION (WHICH SUCH APPLICATION, WHEN SO RECEIVED BY THE AGENT, SHALL
BE DEEMED RECEIVED BY JPMORGAN IN ITS CAPACITY AS AN ISSUER IF JPMORGAN WILL BE
THE ISSUER OF THE APPLICABLE LETTER OF CREDIT), THE AGENT SHALL PROMPTLY NOTIFY
EACH LENDER THAT A LETTER OF CREDIT HAS BEEN REQUESTED IN THE AMOUNT REFLECTED
IN SUCH APPLICATION AND INFORM SUCH LENDER OF THE AMOUNT OF ITS PRO-RATA PORTION
OF SUCH PROPOSED LETTER OF CREDIT (BASED UPON SUCH LENDER’S COMMITMENT
PERCENTAGE).

 

(F)            IF AT ANY TIME ANY ISSUER SHALL HAVE MADE A PAYMENT TO A
BENEFICIARY OF A LETTER OF CREDIT IN RESPECT OF A DRAWING OR IN RESPECT OF AN
ACCEPTANCE CREATED IN CONNECTION WITH A DRAWING UNDER ANY LETTER OF CREDIT
ISSUED BY SUCH ISSUER, EACH OTHER LENDER WILL PAY TO SUCH ISSUER IMMEDIATELY
UPON DEMAND BY THE ISSUER AT ANY TIME DURING THE PERIOD COMMENCING AFTER SUCH
PAYMENT UNTIL REIMBURSEMENT THEREOF IN FULL BY THE COMPANY, AN AMOUNT EQUAL TO
THE PRODUCT OF (A) SUCH LENDER’S COMMITMENT PERCENTAGE TIMES (B) THE AMOUNT OF
SUCH PAYMENT MADE BY SUCH ISSUER TO A BENEFICIARY UNDER SUCH LETTER OF CREDIT,
TOGETHER WITH INTEREST ON SUCH AMOUNT FOR EACH DAY FROM THE DATE OF DEMAND BY
SUCH ISSUER FOR SUCH PAYMENT (OR, IF SUCH DEMAND IS MADE AFTER 11:00 A.M. ON
SUCH DATE, FROM THE NEXT SUCCEEDING BUSINESS DAY) TO THE DATE OF PAYMENT BY SUCH
LENDER TO SUCH ISSUER OF SUCH AMOUNT AT A RATE OF INTEREST PER ANNUM EQUAL TO
THE FEDERAL FUNDS RATE FOR SUCH PERIOD.  NOTHING HEREIN SHALL BE DEEMED TO
REQUIRE ANY LENDER TO PAY TO ANY ISSUER ANY AMOUNT AS REIMBURSEMENT FOR ANY
PAYMENT MADE BY ANY ISSUER TO ACQUIRE (DISCOUNT) FOR ITS OWN ACCOUNT PRIOR TO
MATURITY THEREOF ANY ACCEPTANCE CREATED UNDER A LETTER OF CREDIT.

 

(G)           SIMULTANEOUSLY WITH ANY ISSUER’S ISSUANCE AND DELIVERY OF ANY
LETTER OF CREDIT, SUCH ISSUER SHALL BE DEEMED, WITHOUT FURTHER ACTION, TO HAVE
SOLD TO EACH OTHER LENDER, AND SUCH OTHER LENDER SHALL BE DEEMED, WITHOUT
FURTHER ACTION BY ANY PARTY HERETO, TO HAVE PURCHASED FROM SUCH ISSUER, A
PARTICIPATION INTEREST EQUAL TO SUCH OTHER LENDER’S COMMITMENT PERCENTAGE AT
SUCH TIME IN SUCH LETTER OF CREDIT AND ALL OF THE LETTER OF CREDIT EXPOSURE
AMOUNT RELATED TO SUCH LETTER OF CREDIT; PROVIDED, THAT NO SUCH LENDER SHALL BE
OBLIGATED TO PARTICIPATE IN A PARTICULAR LETTER OF CREDIT IF SUCH LETTER OF
CREDIT WAS ISSUED OR HONORED SOLELY AS A RESULT OF SUCH ISSUER’S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.

 

SECTION 2.16  INCREASE OF COMMITMENTS.

 

(A)           AT ANY TIME, PROVIDED THAT NO EVENT OF DEFAULT SHALL HAVE OCCURRED
AND BE CONTINUING, THE COMPANY MAY REQUEST FROM TIME TO TIME ONE OR MORE
INCREASES OF THE AGGREGATE COMMITMENT BY NOTICE TO THE AGENT IN WRITING OF THE
AMOUNT OF EACH SUCH PROPOSED INCREASE (EACH SUCH NOTICE, A “COMMITMENT INCREASE
NOTICE”).  ANY SUCH COMMITMENT INCREASE NOTICE MUST OFFER EACH LENDER THE
OPPORTUNITY TO SUBSCRIBE FOR ITS PRO RATA SHARE OF THE REQUESTED INCREASE IN THE
AGGREGATE

 

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COMMITMENT, AND THE AGENT SHALL PROMPTLY PROVIDE TO EACH LENDER A COPY OF ANY
COMMITMENT INCREASE NOTICE RECEIVED BY THE AGENT. WITHIN 10 DAYS AFTER RECEIPT
BY THE AGENT OF THE APPLICABLE COMMITMENT INCREASE NOTICE, EACH LENDER WISHING
TO SUBSCRIBE FOR ITS PRO RATA SHARE OF THE REQUESTED INCREASE IN THE AGGREGATE
COMMITMENT MUST DELIVER WRITTEN NOTICE OF SUCH FACT TO THE AGENT.  IF ANY
PORTION OF THE REQUESTED INCREASE IN THE AGGREGATE COMMITMENT IS NOT SUBSCRIBED
FOR BY THE LENDERS WITHIN SUCH 10-DAY PERIOD, THE COMPANY MAY, IN ITS SOLE
DISCRETION, BUT WITH THE CONSENT OF THE AGENT AS TO ANY PERSON THAT IS NOT AT
SUCH TIME A LENDER (WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED
SO LONG AS SUCH PERSON IS AN ELIGIBLE ASSIGNEE), OFFER TO ANY EXISTING LENDER OR
TO ONE OR MORE ADDITIONAL BANKS OR FINANCIAL INSTITUTIONS THE OPPORTUNITY TO
PARTICIPATE IN ALL OR A PORTION OF SUCH UNSUBSCRIBED PORTION OF THE REQUESTED
INCREASE IN THE AGGREGATE COMMITMENT PURSUANT TO SECTION 2.16 (B) OR (C) BELOW,
AS APPLICABLE;

 

(B)           ANY ADDITIONAL BANK OR FINANCIAL INSTITUTION THAT THE COMPANY
SELECTS TO OFFER A PARTICIPATION IN THE UNSUBSCRIBED PORTION OF THE INCREASED
AGGREGATE COMMITMENT, AND THAT ELECTS TO BECOME A PARTY TO THIS AGREEMENT AND
OBTAIN A COMMITMENT, SHALL EXECUTE AN AGREEMENT (A “NEW LENDER AGREEMENT”), IN
PROPER FORM, WITH THE COMPANY AND THE AGENT, WHEREUPON SUCH BANK OR FINANCIAL
INSTITUTION (A “NEW LENDER”) SHALL BECOME A LENDER FOR ALL PURPOSES HEREUNDER TO
THE SAME EXTENT AS IF ORIGINALLY A PARTY HERETO AND SHALL BE BOUND BY AND
ENTITLED TO THE BENEFITS OF THIS AGREEMENT, AND THE SIGNATURE PAGES HEREOF SHALL
BE DEEMED TO ADD THE NAME OF SUCH NEW LENDER AND SCHEDULE 2.1(A)  ATTACHED
HERETO SHALL BE DEEMED AMENDED TO ADD THE NAME AND COMMITMENT OF SUCH NEW
LENDER, PROVIDED THAT THE COMMITMENT OF ANY SUCH NEW LENDER SHALL BE IN AN
AMOUNT NOT LESS THAN $5,000,000;

 

(C)           ANY LENDER THAT ACCEPTS AN OFFER BY THE COMPANY TO INCREASE ITS
COMMITMENT PURSUANT TO THIS SECTION 2.16 SHALL, IN EACH CASE, EXECUTE A
COMMITMENT INCREASE AGREEMENT (A “COMMITMENT INCREASE AGREEMENT”), IN PROPER
FORM, WITH THE COMPANY AND THE AGENT, WHEREUPON SUCH LENDER SHALL BE BOUND BY
AND ENTITLED TO THE BENEFITS OF THIS AGREEMENT WITH RESPECT TO THE FULL AMOUNT
OF ITS COMMITMENT AS SO INCREASED, AND SCHEDULE 2.1(A) ATTACHED HERETO SHALL BE
DEEMED TO BE AMENDED TO REFLECT SUCH INCREASE IN THE COMMITMENT OF SUCH LENDER;

 

(D)           THE EFFECTIVENESS OF ANY NEW LENDER AGREEMENT OR COMMITMENT
INCREASE AGREEMENT SHALL BE CONTINGENT UPON RECEIPT BY THE AGENT OF SUCH
CORPORATE RESOLUTIONS OF THE COMPANY AND LEGAL OPINIONS OF COUNSEL TO THE
COMPANY, IF ANY, AS THE AGENT SHALL REASONABLY REQUEST WITH RESPECT THERETO, IN
EACH CASE IN PROPER FORM;

 

(E)           IF ANY BANK OR FINANCIAL INSTITUTION BECOMES A NEW LENDER PURSUANT
TO SECTION 2.16(B) OR IF ANY LENDER’S COMMITMENT IS INCREASED PURSUANT TO
SECTION 2.16(C), ADDITIONAL LOANS AND ADDITIONAL LIABILITY FOR THE LETTER OF
CREDIT EXPOSURE AMOUNT MADE OR INCURRED ON OR AFTER THE EFFECTIVENESS THEREOF
(THE “RE-ALLOCATION DATE”) SHALL BE MADE PRO RATA BASED ON EACH LENDER’S
(INCLUDING EACH NEW LENDER’S) RESPECTIVE COMMITMENT PERCENTAGE IN EFFECT ON AND
AFTER SUCH RE-ALLOCATION DATE (EXCEPT TO THE EXTENT THAT ANY SUCH PRO RATA
BORROWINGS OR INCURRING OF LIABILITY WOULD RESULT IN ANY LENDER MAKING AN
AGGREGATE PRINCIPAL AMOUNT OF LOANS AND INCURRING LIABILITY FOR THE LETTER OF
CREDIT EXPOSURE AMOUNT IN EXCESS OF ITS COMMITMENT, IN WHICH CASE SUCH EXCESS
AMOUNT WILL BE ALLOCATED TO, AND MADE OR INCURRED BY, SUCH NEW LENDER AND/OR
LENDERS WITH SUCH INCREASED COMMITMENTS TO THE EXTENT OF, AND PRO RATA BASED ON,
THEIR RESPECTIVE COMMITMENT PERCENTAGES), AND CONTINUATIONS OF LIBOR RATE
BORROWINGS OUTSTANDING ON SUCH RE-ALLOCATION DATE SHALL BE EFFECTED BY REPAYMENT
OF SUCH LIBOR RATE BORROWINGS ON THE LAST DAY OF THE LIBOR INTEREST PERIOD
APPLICABLE THERETO AND THE EXTENSION OF NEW LIBOR RATE BORROWINGS PRO RATA BASED
ON THE LENDERS’ RESPECTIVE COMMITMENT PERCENTAGES IN EFFECT ON AND AFTER SUCH
RE-ALLOCATION DATE.  IN THE EVENT THAT ON ANY SUCH RE-ALLOCATION DATE THERE ARE
ALTERNATE BASE RATE BORROWINGS OUTSTANDING, THE COMPANY SHALL MAKE PREPAYMENTS
THEREOF AND BORROW NEW ALTERNATE BASE RATE BORROWINGS SO THAT, AFTER GIVING
EFFECT THERETO, THE ALTERNATE BASE RATE BORROWINGS OUTSTANDING ARE HELD PRO RATA
BASED ON THE LENDERS’ RESPECTIVE COMMITMENT PERCENTAGES IN EFFECT ON AND AFTER
SUCH RE-ALLOCATION DATE.  IN THE EVENT THAT ON ANY SUCH RE-ALLOCATION DATE THERE
ARE LIBOR RATE BORROWINGS

 

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OUTSTANDING, SUCH LIBOR RATE BORROWINGS SHALL REMAIN OUTSTANDING WITH THE
RESPECTIVE HOLDERS THEREOF UNTIL THE EXPIRATION OF THEIR RESPECTIVE LIBOR
INTEREST PERIODS (UNLESS THE COMPANY ELECTS TO PREPAY ANY THEREOF IN ACCORDANCE
WITH THE APPLICABLE PROVISIONS OF THIS AGREEMENT), AND INTEREST ON AND
REPAYMENTS OF SUCH LIBOR RATE BORROWINGS WILL BE PAID THEREON TO THE RESPECTIVE
LENDERS HOLDING SUCH LIBOR RATE BORROWINGS PRO RATA BASED ON THE RESPECTIVE
PRINCIPAL AMOUNTS THEREOF OUTSTANDING;

 

(F)            NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS SECTION 2.16,
(I) NO LENDER SHALL HAVE ANY OBLIGATION TO INCREASE ITS COMMITMENT UNDER THIS
SECTION 2.16 UNLESS IT AGREES IN WRITING TO DO SO IN ITS SOLE DISCRETION,
(II) NO LENDER SHALL HAVE ANY RIGHT TO DECREASE THE AMOUNT OF ITS COMMITMENT AS
A RESULT OF ANY REQUESTED INCREASE OF THE AGGREGATE COMMITMENT PURSUANT TO THIS
SECTION 2.16, (III) NEITHER THE AGENT NOR ANY LENDER SHALL HAVE ANY OBLIGATION
TO FIND OR LOCATE ANY NEW LENDER TO PARTICIPATE IN ANY UNSUBSCRIBED PORTION OF
ANY INCREASE IN THE AGGREGATE COMMITMENT REQUESTED BY THE COMPANY, (IV) EACH
INCREASE IN THE AGGREGATE COMMITMENT REQUESTED BY THE COMPANY SHALL NOT BE LESS
THAN $10,000,000, (V) AFTER GIVING EFFECT TO ANY INCREASE IN THE AGGREGATE
COMMITMENT PURSUANT TO THIS SECTION 2.16, THE AGGREGATE COMMITMENT SHALL NOT
EXCEED $350,000,000, AND (VI) IN THE EVENT OF ANY REDUCTION IN THE AGGREGATE
COMMITMENT PURSUANT TO SECTION 2.2 OR ANY OTHER PROVISION OF THIS AGREEMENT, THE
ABILITY OF THE COMPANY TO REQUEST INCREASES IN THE AGGREGATE COMMITMENT PURSUANT
TO THIS SECTION 2.16 SHALL AUTOMATICALLY TERMINATE; AND

 

(G)           THE COMPANY SHALL EXECUTE AND DELIVER TO THE AGENT (FOR DELIVERY
BY THE AGENT TO EACH APPLICABLE LENDER) A NEW NOTE PAYABLE TO EACH APPLICABLE
LENDER (INCLUDING EACH NEW LENDER) PARTICIPATING IN ANY INCREASE OF THE
AGGREGATE COMMITMENT IN THE ORIGINAL PRINCIPAL AMOUNT OF SUCH LENDER’S
COMMITMENT AFTER GIVING EFFECT TO ANY INCREASE OF THE AGGREGATE COMMITMENT.

 

ARTICLE III -  — CONDITIONS

 

SECTION 3.1  ALL LOANS.  THE OBLIGATION OF EACH LENDER TO MAKE ANY LOAN OR OF
ANY ISSUER TO ISSUE ANY LETTER OF CREDIT (INCLUDING WITHOUT LIMITATION, ANY
EXTENSION OF THE EXPIRY DATE OF ANY LETTER OF CREDIT OR INCREASE IN THE FACE
AMOUNT OF ANY LETTER OF CREDIT) IS SUBJECT TO THE ACCURACY OF ALL
REPRESENTATIONS AND WARRANTIES OF THE COMPANY ON THE DATE OF SUCH LOAN OR
ISSUANCE OF SUCH LETTER OF CREDIT, TO THE PERFORMANCE BY THE COMPANY OF ITS
OBLIGATIONS UNDER THE LOAN DOCUMENTS AND TO THE SATISFACTION OF THE FOLLOWING
FURTHER CONDITIONS:

 

(A)           THE AGENT SHALL HAVE RECEIVED THE FOLLOWING, ALL OF WHICH SHALL BE
DULY EXECUTED AND IN PROPER FORM: (1) IN THE CASE OF A LOAN, OTHER THAN A LOAN
TO BE MADE TO REPAY A LETTER OF CREDIT ADVANCE PURSUANT TO SECTION 2.4 HEREOF,:

 

I.              BY NO LATER THAN 12:00 NOON (NEW YORK CITY TIME) ON THE
APPLICABLE RATE SELECTION DATE, NOTICE BY TELEPHONE OR FACSIMILE FROM THE
COMPANY OF THE PROPOSED DATE AND AMOUNT OF SUCH LOAN, AND

 

II.             NO LATER THAN 2:00 P.M. (NEW YORK CITY TIME) ON THE APPLICABLE
RATE SELECTION DATE, A REQUEST FOR EXTENSION OF CREDIT AND CERTIFICATE OF NO
DEFAULT, SIGNED BY A RESPONSIBLE OFFICER;

 

OR, IN THE CASE OF ISSUANCE OF A LETTER OF CREDIT, A COMPLETED APPLICATION (AS
MAY BE REQUIRED BY THE AGENT OR THE APPLICABLE ISSUER) SIGNED BY A RESPONSIBLE
OFFICER OF THE COMPANY BY 10:00 A.M. FIVE (5) BUSINESS DAYS PRIOR TO THE
PROPOSED DATE OF ISSUANCE OF SUCH LETTER OF CREDIT AND PAYMENT OF THE FIRST
QUARTERLY LETTER OF CREDIT FEE AS AND BY THE TIME REQUIRED IN SECTION 2.15(B) OF
THIS AGREEMENT, ALONG WITH, IN EACH CASE, SUCH FINANCIAL INFORMATION AS THE
AGENT MAY REASONABLY REQUIRE TO SUBSTANTIATE COMPLIANCE WITH ALL FINANCIAL
COVENANTS CONTAINED HEREIN BY THE COMPANY;

 

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AND (2) SUCH OTHER APPLICATIONS, CERTIFICATES AND OTHER DOCUMENTS AS THE AGENT
MAY REASONABLY REQUIRE;

 

(B)           NO DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING, OR WOULD RESULT
THEREFROM;

 

(C)           THE REPRESENTATIONS AND WARRANTIES CONTAINED IN THE LOAN DOCUMENTS
ARE TRUE AND CORRECT ON AND AS OF SUCH DATE (EXCEPT ANY REPRESENTATION AND
WARRANTY THAT EXPRESSLY INDICATES THAT IT IS BEING MADE AS OF A SPECIFIC DATE,
AND THEN AS OF SUCH DATE);

 

(D)           THE MAKING OF SUCH LOAN OR THE ISSUANCE OF SUCH LETTER OF CREDIT,
SHALL NOT BE PROHIBITED BY, OR SUBJECT THE AGENT, THE APPLICABLE ISSUER OR ANY
LENDER TO ANY PENALTY OR ONEROUS CONDITION UNDER, ANY LEGAL REQUIREMENT; AND

 

(E)           THE COMPANY SHALL HAVE PAID ALL LEGAL FEES AND EXPENSES OF THE
TYPE DESCRIBED IN SECTION 9.8 HEREOF THROUGH THE DATE OF SUCH LOAN OR THE
ISSUANCE OF SUCH LETTER OF CREDIT.

 

SECTION 3.2  FIRST LOAN.  IN ADDITION TO THE MATTERS DESCRIBED IN SECTION 3.1
HEREOF, THE OBLIGATION OF ANY LENDER TO MAKE THE INITIAL LOAN OR OF ANY ISSUER
TO ISSUE THE FIRST LETTER OF CREDIT ON THE DATE THEREOF (THE “EFFECTIVE DATE”)
IS SUBJECT TO THE SATISFACTION OF THE FOLLOWING CONDITIONS PRECEDENT:

 

(A)           THE AGENT SHALL HAVE RECEIVED ON OR BEFORE THE EFFECTIVE DATE THE
FOLLOWING, EACH DATED SUCH DAY (UNLESS OTHERWISE SPECIFIED), IN PROPER FORM AND
(EXCEPT FOR THE NOTES) IN SUFFICIENT COPIES FOR EACH LENDER:

 

I.              COUNTERPARTS TO THIS AGREEMENT EXECUTED BY THE COMPANY AND EACH
LENDER;

 

II.             THE NOTES PAYABLE TO THE ORDER OF THE LENDERS TO THE EXTENT
REQUESTED BY THE LENDERS PURSUANT TO THE TERMS HEREOF;

 

III.            THE GUARANTY AND THE CONTRIBUTION AGREEMENT DULY EXECUTED AND
DELIVERED BY EACH GUARANTOR AS OF THE EFFECTIVE DATE;

 

IV.            CERTIFIED COPIES OF THE RESOLUTIONS OF THE BOARD OF DIRECTORS (OR
EQUIVALENT BODY) OF EACH LOAN PARTY APPROVING THE TRANSACTION AND EACH LOAN
DOCUMENT TO WHICH IT IS OR IS TO BE A PARTY.

 

V.             A SECURITY AGREEMENT IN SUBSTANTIALLY THE FORM OF EXHIBIT G-A
AUTHORIZED AND EXECUTED BY THE PARTIES THERETO.

 

VI.            COPIES OF PROPER FINANCING STATEMENTS IN RESPECT OF ALL THE LOAN
PARTIES, TOGETHER WITH EVIDENCE THAT SUCH FINANCING STATEMENTS HAVE BEEN
PRESENTED FOR FILING ON OR BEFORE THE EFFECTIVE DATE IN ALL JURISDICTIONS THAT
THE AGENT MAY DEEM NECESSARY OR DESIRABLE IN ORDER TO PERFECT AND PROTECT THE
FIRST PRIORITY LIENS AND SECURITY INTERESTS CREATED UNDER THE SECURITY AGREEMENT
A, COVERING THE COLLATERAL DESCRIBED THEREIN.

 

VII.           A COPY OF A CERTIFICATE OF THE SECRETARY OF STATE OF THE
JURISDICTION OF INCORPORATION OF EACH LOAN PARTY, DATED REASONABLY NEAR THE
EFFECTIVE DATE CERTIFYING (A) AS TO A TRUE AND CORRECT COPY OF THE CHARTER OF
SUCH LOAN PARTY AND EACH AMENDMENT THERETO ON FILE IN SUCH SECRETARY’S OFFICE
AND (B) THAT (1) SUCH AMENDMENTS ARE THE ONLY AMENDMENTS TO SUCH LOAN PARTY’S
CHARTER ON FILE IN SUCH SECRETARY’S OFFICE, (2) SUCH LOAN PARTY HAS PAID ALL
FRANCHISE TAXES

 

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TO THE DATE OF SUCH CERTIFICATE AND (3) SUCH LOAN PARTY IS DULY INCORPORATED AND
IN GOOD STANDING OR PRESENTLY SUBSISTING UNDER THE LAWS OF THE STATE OF THE
JURISDICTION OF ITS INCORPORATION.

 

VIII.          A CERTIFICATE OF EACH LOAN PARTY SIGNED ON BEHALF OF SUCH LOAN
PARTY BY ITS SECRETARY OR ANY ASSISTANT SECRETARY, DATED THE EFFECTIVE DATE (THE
STATEMENTS MADE IN WHICH CERTIFICATE SHALL BE TRUE ON AND AS OF THE EFFECTIVE
DATE), CERTIFYING AS TO (A) THE ABSENCE OF ANY AMENDMENTS TO THE CHARTER OF SUCH
LOAN PARTY SINCE THE DATE OF THE SECRETARY OF STATE’S CERTIFICATE REFERRED TO IN
SECTION 3.2(A)(V), (B) A TRUE AND CORRECT COPY OF THE BYLAWS OF SUCH LOAN PARTY
AS IN EFFECT ON THE DATE ON WHICH THE RESOLUTIONS REFERRED TO IN
SECTION 3.2(A)(IV) WERE ADOPTED AND ON THE EFFECTIVE DATE, (C) THE ABSENCE OF
ANY PROCEEDING FOR THE DISSOLUTION OR LIQUIDATION OF SUCH LOAN PARTY, (D) THE
TRUTH IN ALL MATERIAL RESPECTS OF THE REPRESENTATIONS AND WARRANTIES CONTAINED
IN THE LOAN DOCUMENTS AS THOUGH MADE ON AND AS OF THE EFFECTIVE DATE, (E) THE
ABSENCE OF ANY EVENT OCCURRING AND CONTINUING, OR RESULTING FROM THE INITIAL
BORROWING HEREUNDER, THAT CONSTITUTES A DEFAULT, AND (F) CERTIFYING THE NAMES
AND TRUE SIGNATURES OF THE OFFICERS OF SUCH LOAN PARTY AUTHORIZED TO SIGN EACH
LOAN DOCUMENT TO WHICH IT IS OR IS TO BE A PARTY AND THE OTHER DOCUMENTS TO BE
DELIVERED HEREUNDER AND THEREUNDER.

 

IX.            A CERTIFICATE, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO
THE LENDERS, ATTESTING TO THE SOLVENCY OF THE COMPANY AND ITS SUBSIDIARIES, ON A
CONSOLIDATED BASIS, BOTH BEFORE AND AFTER GIVING EFFECT TO THE TRANSACTIONS,
FROM ITS CHIEF FINANCIAL OFFICER.

 

X.             AUDITED ANNUAL FINANCIAL STATEMENTS OF THE COMPANY AND THE TARGET
FOR THE THREE FISCAL YEARS MOST RECENTLY ENDED AND INTERIM FINANCIAL STATEMENTS
FOR THE FISCAL QUARTERS ENDED THEREAFTER AND PRIOR TO THE EFFECTIVE DATE AND FOR
THE MOST RECENT QUARTER FOR WHICH FINANCIAL STATEMENTS ARE AVAILABLE, PRO FORMA
FINANCIAL STATEMENTS AS TO THE COMPANY AND ITS SUBSIDIARIES GIVING EFFECT TO THE
TRANSACTIONS, AND FORECASTS PREPARED BY MANAGEMENT OF THE COMPANY, EACH IN FORM
AND SUBSTANCE REASONABLY SATISFACTORY TO THE LENDERS, OF BALANCE SHEETS, INCOME
STATEMENTS AND CASH FLOW STATEMENTS ON AN ANNUAL BASIS FOR EACH YEAR FOLLOWING
THE EFFECTIVE DATE UNTIL THE TERMINATION DATE.

 

XI.            A FAVORABLE OPINION OF COUNSEL FOR THE LOAN PARTIES, IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO THE LENDERS.

 

(B)           THE TENDER OFFER SHALL HAVE BEEN CONSUMMATED, OR SHALL BE
CONSUMMATED SUBSTANTIALLY CONCURRENTLY WITH THE INITIAL BORROWING HEREUNDER, ON
SUBSTANTIALLY THE TERMS AND CONDITIONS SET FORTH IN THE MERGER AGREEMENT,
WITHOUT ANY AMENDMENT OR WAIVER OF ANY MATERIAL TERM THEREOF THAT IS ADVERSE, IN
ANY MATERIAL RESPECT, TO THE INTERESTS OF THE LENDERS, AND THE COMPANY SHALL
HAVE ACQUIRED NOT LESS THAN A MAJORITY OF THE CAPITAL STOCK OF THE TARGET.

 

(C)           THE TARGET’S EXISTING CREDIT AND LETTER OF CREDIT FACILITIES WITH
BANK OF AMERICA, N.A. SHALL HAVE BEEN TERMINATED AND ALL LOANS, IF ANY,
OUTSTANDING THEREUNDER, AS WELL AS ALL ACCRUED INTEREST AND FEES THEREUNDER, IF
ANY, SHALL HAVE BEEN PAID IN FULL.

 

(D)           THERE SHALL EXIST NO ACTION, SUIT, INVESTIGATION, LITIGATION OR
PROCEEDING AFFECTING ANY LOAN PARTY OR ANY OF ITS SUBSIDIARIES PENDING OR, TO
THE KNOWLEDGE OF THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES, THREATENED
BEFORE ANY GOVERNMENTAL AUTHORITY THAT HAS HAD OR COULD REASONABLY BE EXPECTED
TO HAVE A MATERIAL ADVERSE EFFECT ON THE LEGALITY, VALIDITY OR ENFORCEABILITY OF
ANY LOAN DOCUMENT OR THE CONSUMMATION OF THE TRANSACTIONS.

 

(E)           ALL GOVERNMENTAL AUTHORIZATIONS AND THIRD-PARTY CONSENTS AND
APPROVALS REQUIRED TO BE OBTAINED UNDER THE MERGER AGREEMENT IN CONNECTION WITH
THE TRANSACTIONS SHALL HAVE BEEN OBTAINED

 

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(WITHOUT THE IMPOSITION OF ANY CONDITIONS THAT MATERIALLY AND ADVERSELY IMPAIR
THE RIGHTS AND REMEDIES OF THE LENDERS UNDER THE LOAN DOCUMENTS) AND SHALL
REMAIN IN EFFECT.

 

(F)            THE COMPANY SHALL HAVE PAID ALL ACCRUED FEES AND EXPENSES OF THE
AGENT THAT ARE DUE AND PAYABLE IN ACCORDANCE HEREWITH (INCLUDING THE ACCRUED
FEES AND EXPENSES OF COUNSEL TO THE AGENT AND FEES DUE AND PAYABLE TO THE JOINT
LEAD ARRANGERS PURSUANT TO THE FEE LETTER).

 

SECTION 3.3  DETERMINATIONS UNDER SECTION 3.2.  FOR PURPOSES OF DETERMINING
COMPLIANCE WITH THE CONDITIONS SPECIFIED IN SECTION 3.2, EACH LENDER SHALL BE
DEEMED TO HAVE CONSENTED TO, APPROVED OR ACCEPTED OR TO BE SATISFIED WITH EACH
DOCUMENT OR OTHER MATTER REQUIRED THEREUNDER TO BE CONSENTED TO OR APPROVED BY
OR ACCEPTABLE OR SATISFACTORY TO THE LENDERS UNLESS AN OFFICER OF THE AGENT
RESPONSIBLE FOR THE TRANSACTIONS CONTEMPLATED BY THE LOAN DOCUMENTS SHALL HAVE
RECEIVED NOTICE FROM SUCH LENDER PRIOR TO THE INITIAL BORROWING HEREUNDER
SPECIFYING ITS OBJECTION THERETO AND SHALL NOT HAVE MADE AVAILABLE TO THE AGENT
SUCH LENDER’S RATABLE PORTION OF SUCH BORROWING.

 

ARTICLE IV — REPRESENTATIONS AND WARRANTIES

 

To induce the Agent and the Lenders to enter into this Agreement, subject to the
Target Representation Limitations, the Company represents and warrants to the
Agent and the Lenders as follows:

 

SECTION 4.1  ORGANIZATION.  EACH OF THE COMPANY AND ITS SUBSIDIARIES IS DULY
ORGANIZED, VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS OF THE STATE OF
ITS INCORPORATION; HAS ALL POWER AND AUTHORITY TO CONDUCT ITS BUSINESS AS
PRESENTLY CONDUCTED; AND IS DULY QUALIFIED TO DO BUSINESS AND IN GOOD STANDING
IN EACH AND EVERY STATE IN THE UNITED STATES OF AMERICA WHERE ITS BUSINESS
REQUIRES SUCH QUALIFICATION, EXCEPT WHERE FAILURE TO QUALIFY COULD NOT
REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

SECTION 4.2  FINANCIAL STATEMENTS.  THE FINANCIAL STATEMENTS OF THE COMPANY AND
ITS SUBSIDIARIES ON A CONSOLIDATED BASIS DELIVERED TO THE AGENT AND THE LENDERS
IN CONNECTION WITH THIS AGREEMENT FAIRLY PRESENT, IN ACCORDANCE WITH GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES, THE FINANCIAL CONDITION AND THE RESULTS OF
OPERATIONS OF THE COMPANY AND ITS SUBSIDIARIES AS OF THE DATES AND FOR THE
PERIODS INDICATED.  SINCE THE DATE OF THE LAST AUDITED FINANCIAL STATEMENTS OF
THE COMPANY, NO EVENT, DEVELOPMENT OR CIRCUMSTANCE HAS OCCURRED OR EXISTS THAT
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

SECTION 4.3  ENFORCEABLE OBLIGATIONS; AUTHORIZATION.  THE LOAN DOCUMENTS ARE
LEGAL, VALID AND BINDING OBLIGATIONS OF THE COMPANY AND THE GUARANTORS,
ENFORCEABLE IN ACCORDANCE WITH THEIR RESPECTIVE TERMS, EXCEPT AS MAY BE LIMITED
BY BANKRUPTCY, INSOLVENCY AND OTHER SIMILAR LAWS AFFECTING CREDITORS RIGHTS
GENERALLY AND BY GENERAL EQUITABLE PRINCIPLES.  THE EXECUTION, DELIVERY AND
PERFORMANCE OF THE LOAN DOCUMENTS HAVE ALL BEEN DULY AUTHORIZED BY ALL NECESSARY
ACTION; ARE WITHIN THE POWER AND AUTHORITY OF THE COMPANY AND THE GUARANTORS; DO
NOT AND WILL NOT CONTRAVENE OR VIOLATE ANY LEGAL REQUIREMENT OR THE
ORGANIZATIONAL DOCUMENTS OF THE COMPANY OR ANY GUARANTORS; DO NOT AND WILL NOT
RESULT IN THE BREACH OF, OR CONSTITUTE A DEFAULT UNDER, ANY AGREEMENT OR
INSTRUMENT BY WHICH THE COMPANY OR ANY GUARANTORS OR ANY OF THEIR RESPECTIVE
PROPERTY MAY BE BOUND OR AFFECTED; AND DO NOT AND WILL NOT RESULT IN THE
CREATION OF ANY LIEN UPON ANY PROPERTY OF THE COMPANY OR ANY GUARANTORS EXCEPT
AS EXPRESSLY CONTEMPLATED THEREIN.  ALL NECESSARY PERMITS, REGISTRATIONS AND
CONSENTS FOR THE EXECUTION, DELIVERY AND PERFORMANCE BY THE COMPANY AND ITS
SUBSIDIARIES OF THE LOAN DOCUMENTS HAVE BEEN OBTAINED.

 

SECTION 4.4  OTHER DEBT.  NEITHER THE COMPANY NOR ANY OF ITS SUBSIDIARIES IS IN
DEFAULT IN THE PAYMENT OF ANY OTHER INDEBTEDNESS OR UNDER ANY AGREEMENT,
MORTGAGE, DEED OF TRUST, SECURITY

 

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AGREEMENT OR LEASE TO WHICH IT IS A PARTY, THE RESULT OF WHICH HAS, WOULD OR
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

SECTION 4.5  LITIGATION.  THERE IS NO LITIGATION OR ADMINISTRATIVE PROCEEDING
PENDING OR, TO THE KNOWLEDGE OF THE COMPANY, THREATENED AGAINST, NOR ANY
OUTSTANDING JUDGMENT, ORDER OR DECREE AFFECTING, THE COMPANY OR ANY OF ITS
SUBSIDIARIES BEFORE OR BY ANY GOVERNMENTAL AUTHORITY OR ARBITRAL BODY WHICH IN
THE AGGREGATE HAVE, OR IF ADVERSELY DETERMINED, COULD REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT.  NEITHER THE COMPANY NOR ANY OF ITS SUBSIDIARIES
IS IN DEFAULT WITH RESPECT TO ANY MATERIAL JUDGMENT, ORDER OR DECREE OF ANY
GOVERNMENTAL AUTHORITY.

 

SECTION 4.6  TITLE.  EACH OF THE COMPANY AND ITS SUBSIDIARIES HAS GOOD AND
MARKETABLE TITLE TO ITS PROPERTY (OTHER THAN NEGLIGIBLE ASSETS NOT MATERIAL TO
THE OPERATIONS OF THE COMPANY OR ANY OF ITS SUBSIDIARIES), FREE AND CLEAR OF ALL
LIENS EXCEPT FOR INCIDENTAL LIENS.

 

SECTION 4.7  TAXES.  EACH OF THE COMPANY AND ITS SUBSIDIARIES HAS FILED ALL TAX
RETURNS REQUIRED TO HAVE BEEN FILED AND PAID ALL TAXES SHOWN THEREON TO BE DUE,
EXCEPT THOSE FOR WHICH EXTENSIONS HAVE BEEN OBTAINED AND EXCEPT FOR THOSE WHICH
ARE BEING CONTESTED IN GOOD FAITH AND BY APPROPRIATE PROCEEDINGS IF ADEQUATE
RESERVES WITH RESPECT THERETO ARE MAINTAINED IN ACCORDANCE WITH GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES.

 

SECTION 4.8  SUBSIDIARIES.  AS OF THE DATE HEREOF, THE COMPANY HAS NO
SUBSIDIARIES OTHER THAN AS LISTED ON SCHEDULE 4.8 ATTACHED HERETO.  EXCEPT AS
EXPRESSLY INDICATED ON SCHEDULE 4.8 ATTACHED HERETO, EACH OF THE COMPANY’S
SUBSIDIARIES IS WHOLLY OWNED BY THE COMPANY.

 

SECTION 4.9  REPRESENTATIONS BY OTHERS.  ALL REPRESENTATIONS AND WARRANTIES MADE
BY OR ON BEHALF OF THE COMPANY OR ANY OF ITS SUBSIDIARIES IN ANY LOAN DOCUMENT
SHALL CONSTITUTE REPRESENTATIONS AND WARRANTIES OF THE COMPANY HEREUNDER.

 

SECTION 4.10  PERMITS, LICENSES, ETC.  THE COMPANY AND EACH OF ITS SUBSIDIARIES
POSSESS ALL PERMITS, LICENSES, PATENTS, PATENT RIGHTS OR LICENSES, TRADEMARKS,
TRADEMARK RIGHTS, TRADE NAMES, TRADE NAME RIGHTS AND COPYRIGHTS WHICH ARE
REQUIRED TO CONDUCT ITS BUSINESS, AND WHICH THE FAILURE OF THE COMPANY OR ANY OF
ITS SUBSIDIARIES TO SO POSSESS WOULD OR COULD REASONABLY BE EXPECTED TO HAVE A
MATERIAL ADVERSE AFFECT ON THE FINANCIAL CONDITION OR OPERATIONS OF THE COMPANY
AND ITS SUBSIDIARIES ON A CONSOLIDATED BASIS.

 

SECTION 4.11  ERISA.  NO REPORTABLE EVENT (AS DEFINED IN SECTION 4043(B) OF
ERISA BUT EXCLUDING THOSE EVENTS AS TO WHICH THE 30-DAY NOTICE PERIOD IS WAIVED
BY APPLICABLE REGULATIONS) HAS OCCURRED WITH RESPECT TO ANY PLAN.  EACH PLAN
COMPLIES IN ALL MATERIAL RESPECTS WITH ALL APPLICABLE PROVISIONS OF ERISA, AND
THE COMPANY AND EACH OF ITS SUBSIDIARIES HAVE FILED ALL REPORTS REQUIRED BY
ERISA AND THE CODE TO BE FILED WITH RESPECT TO EACH PLAN.  THE COMPANY HAS NO
KNOWLEDGE OF ANY EVENT WHICH COULD RESULT IN A LIABILITY OF THE COMPANY OR ANY
OF ITS SUBSIDIARIES TO THE PENSION BENEFIT GUARANTY CORPORATION OTHER THAN FOR
APPLICABLE PREMIUMS.  NO ACCUMULATED FUNDING DEFICIENCY (AS DEFINED IN
SECTION 302 OF ERISA AND SECTION 412 OF THE CODE), WHETHER OR NOT WAIVED, EXISTS
WITH RESPECT TO ANY PLAN.  NO EVENT HAS OCCURRED AND NO CONDITION EXISTS THAT
MIGHT REASONABLY BE EXPECTED TO CONSTITUTE GROUNDS FOR A PLAN TO BE TERMINATED
UNDER CIRCUMSTANCES WHICH WOULD CAUSE THE LIEN PROVIDED UNDER SECTION 4068 OF
ERISA TO ATTACH TO ANY PROPERTY OF THE COMPANY OR ANY OF ITS SUBSIDIARIES.  NO
EVENT HAS OCCURRED AND NO CONDITION EXISTS THAT MIGHT REASONABLY BE EXPECTED TO
CAUSE THE LIEN PROVIDED UNDER SECTION 302 OF ERISA OR SECTION 412 OF THE CODE TO
ATTACH TO ANY PROPERTY OF THE COMPANY OR ANY OF ITS SUBSIDIARIES.

 

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SECTION 4.12  CONDITION OF PROPERTY.  THE PROPERTY USED OR TO BE USED IN THE
CONTINUING OPERATIONS OF THE COMPANY AND ITS SUBSIDIARIES, WHEN TAKEN AS A
WHOLE, IS IN GOOD REPAIR, WORKING ORDER AND CONDITION.

 

SECTION 4.13  ASSUMED NAMES.  NEITHER THE COMPANY NOR ANY OF ITS SUBSIDIARIES IS
CURRENTLY CONDUCTING ITS BUSINESS UNDER ANY ASSUMED NAME OR NAMES, EXCEPT AS SET
FORTH ON SCHEDULE 4.13 ATTACHED HERETO.

 

SECTION 4.14  INVESTMENT COMPANY ACT.  NEITHER THE COMPANY NOR ANY OF ITS
SUBSIDIARIES IS AN INVESTMENT COMPANY WITHIN THE MEANING OF THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED, OR, DIRECTLY OR INDIRECTLY, CONTROLLED BY OR
ACTING ON BEHALF OF ANY PERSON WHICH IS AN INVESTMENT COMPANY, WITHIN THE
MEANING OF SAID ACT.

 

SECTION 4.15  MARGIN STOCK.  THE COMPANY IS NOT ENGAGED IN THE BUSINESS OF
EXTENDING CREDIT FOR THE PURPOSE OF PURCHASING OR CARRYING MARGIN STOCK, AND NO
PROCEEDS OF ANY LOAN WILL BE USED TO PURCHASE OR CARRY ANY MARGIN STOCK OR TO
EXTEND CREDIT TO OTHERS FOR THE PURPOSE OF PURCHASING OR CARRYING ANY MARGIN
STOCK, OTHER THAN IN RESPECT OF THE TRANSACTION.

 

SECTION 4.16  AGREEMENTS.  SCHEDULE 4.16 ATTACHED HERETO IS A COMPLETE AND
CORRECT LIST OF (I) ALL CREDIT AGREEMENTS FOR BORROWED MONEY (OTHER THAN THE
INDEBTEDNESS GOVERNED HEREBY), INDENTURES AND CAPITALIZED LEASES AND ALL
PROPERTY SUBJECT TO ANY LIEN SECURING SUCH INDEBTEDNESS OR LEASE OBLIGATION,
(II) EACH LETTER OF CREDIT AND GUARANTY FOR WHICH THE LIABILITY OR POTENTIAL
LIABILITY OF THE COMPANY AND ITS SUBSIDIARIES ON A CONSOLIDATED BASIS IS IN
EXCESS OF $250,000, (III) ALL OTHER MATERIAL INSTRUMENTS IN EFFECT AS OF THE
DATE HEREOF PROVIDING FOR, EVIDENCING, SECURING OR OTHERWISE RELATING TO ANY
INDEBTEDNESS FOR BORROWED MONEY OF THE COMPANY OR ANY OF ITS SUBSIDIARIES (OTHER
THAN THE INDEBTEDNESS HEREUNDER AND INDEBTEDNESS SECURED BY INCIDENTAL LIENS),
AND (IV) ALL OBLIGATIONS OF THE COMPANY OR ANY OF ITS SUBSIDIARIES TO ISSUERS OF
APPEAL BONDS ISSUED FOR ACCOUNT OF THE COMPANY OR ANY OF ITS SUBSIDIARIES.  THE
COMPANY SHALL, UPON REQUEST BY THE AGENT, DELIVER TO THE AGENT AND THE LENDERS A
COMPLETE AND CORRECT COPY OF ALL SUCH CREDIT AGREEMENTS, INDENTURES, CAPITALIZED
LEASES, LETTERS OF CREDIT, GUARANTEES AND OTHER INSTRUMENTS OR LEASES DESCRIBED
IN SCHEDULE 4.16 OR ARISING AFTER THE DATE HEREOF, INCLUDING ANY MODIFICATIONS
OR SUPPLEMENTS THERETO, AS IN EFFECT ON THE DATE HEREOF.

 

SECTION 4.17  ENVIRONMENTAL MATTERS.  NO ACTIVITY OF THE COMPANY OR ANY OF ITS
SUBSIDIARIES REQUIRES ANY ENVIRONMENTAL PERMIT WHICH HAS NOT BEEN OBTAINED AND
WHICH IS NOT NOW IN FULL FORCE AND EFFECT, EXCEPT TO THE EXTENT FAILURE TO HAVE
ANY SUCH ENVIRONMENTAL PERMIT COULD NOT REASONABLY BE EXPECTED TO HAVE A
MATERIAL ADVERSE EFFECT.  THE COMPANY AND ITS SUBSIDIARIES ARE IN COMPLIANCE
WITH ALL LIMITATIONS, RESTRICTIONS, CONDITIONS, STANDARDS, PROHIBITIONS,
REQUIREMENTS, OBLIGATIONS, SCHEDULES AND TIMETABLES CONTAINED IN ANY APPLICABLE
REQUIREMENT OF ENVIRONMENTAL LAW OR ENVIRONMENTAL PERMIT, EXCEPT WHERE FAILURE
TO BE IN SUCH COMPLIANCE COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT.  THE COMPANY AND ITS SUBSIDIARIES (AND, TO THE BEST KNOWLEDGE OF
THE COMPANY, EACH OF THE PRIOR OWNERS OR OPERATORS AND PREDECESSORS IN INTEREST
WITH RESPECT TO ANY OF ITS OR ITS SUBSIDIARIES’ PROPERTY) (I) HAVE OBTAINED AND
MAINTAINED IN EFFECT ALL ENVIRONMENTAL PERMITS, THE FAILURE TO OBTAIN WHICH
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT, (II) ALONG WITH
THEIR RESPECTIVE PROPERTY HAVE BEEN AND ARE IN COMPLIANCE WITH ALL APPLICABLE
REQUIREMENTS OF ENVIRONMENTAL LAW AND ENVIRONMENTAL PERMITS WHERE SUCH FAILURE
TO COMPLY THEREWITH COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE
EFFECT, (III) ALONG WITH THEIR PROPERTY ARE NOT SUBJECT TO ANY (A) ENVIRONMENTAL
CLAIMS OR (B) ENVIRONMENTAL LIABILITIES, IN EITHER CASE DIRECT OR CONTINGENT,
AND WHETHER KNOWN OR UNKNOWN, ARISING FROM OR BASED UPON ANY ACT, OMISSION,
EVENT, CONDITION OR CIRCUMSTANCE OCCURRING OR EXISTING ON OR PRIOR TO THE DATE
HEREOF WHICH COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT, AND
(IV) HAVE NOT RECEIVED INDIVIDUALLY OR COLLECTIVELY ANY NOTICE OF ANY VIOLATION
OR ALLEGED VIOLATION OF ANY REQUIREMENTS OF ENVIRONMENTAL LAW OR ENVIRONMENTAL
PERMIT OR ANY ENVIRONMENTAL CLAIM IN CONNECTION

 

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WITH THEIR RESPECTIVE PROPERTY WHICH COULD REASONABLY BE EXPECTED TO HAVE A
MATERIAL ADVERSE EFFECT.  THE PRESENT AND FUTURE LIABILITY (INCLUDING ANY
ENVIRONMENTAL LIABILITY AND ANY OTHER DAMAGE TO PERSONS OR PROPERTY), IF ANY, OF
THE COMPANY AND WITH RESPECT TO THE PROPERTY OF ANY OF THE COMPANY OR ANY OF ITS
SUBSIDIARIES WHICH IS REASONABLY EXPECTED TO ARISE IN CONNECTION WITH
REQUIREMENTS OF ENVIRONMENTAL LAW, ENVIRONMENTAL PERMITS AND OTHER ENVIRONMENTAL
MATTERS WILL NOT HAVE A MATERIAL ADVERSE EFFECT ON THE COMPANY AND ITS
SUBSIDIARIES ON A CONSOLIDATED BASIS.

 

SECTION 4.18  SOLVENCY.  THE COMPANY AND ITS SUBSIDIARIES ARE, ON A CONSOLIDATED
BASIS, SOLVENT.

 

SECTION 4.19  TARGET REPRESENTATIONS.  AS TO ANY DATE OF DETERMINATION PRIOR TO
THE CONSUMMATION OF THE MERGER, THE COMPANY MAKES THE TARGET REPRESENTATIONS,
EXCEPT WHERE THE FAILURE OF ANY TARGET REPRESENTATION TO BE TRUE AND CORRECT ON
SUCH DATE WOULD NOT BE MATERIAL AND ADVERSE TO THE INTERESTS OF THE LENDERS.

 

ARTICLE V — AFFIRMATIVE COVENANTS

 

The Company covenants and agrees with the Agent and the Lenders that prior to
the termination of this Agreement it will do, cause each of its Subsidiaries to
do, and if necessary cause to be done, each and all of the following:

 

SECTION 5.1  TAXES, EXISTENCE, REGULATIONS, PROPERTY, ETC.  AT ALL TIMES (A) PAY
WHEN DUE ALL TAXES AND GOVERNMENTAL CHARGES OF EVERY KIND UPON IT OR AGAINST ITS
INCOME, PROFITS OR PROPERTY, UNLESS AND ONLY TO THE EXTENT THAT THE SAME SHALL
BE CONTESTED IN GOOD FAITH AND RESERVES DEEMED ADEQUATE BY THE AGENT HAVE BEEN
ESTABLISHED THEREFOR; (B) DO ALL THINGS NECESSARY TO PRESERVE ITS CORPORATE
EXISTENCE, QUALIFICATIONS, RIGHTS AND FRANCHISES IN ALL STATES WHERE SUCH
QUALIFICATION IS NECESSARY OR DESIRABLE; (C) COMPLY IN ALL MATERIAL RESPECTS
WITH ALL APPLICABLE LEGAL REQUIREMENTS (INCLUDING ALL APPLICABLE REQUIREMENTS OF
ENVIRONMENTAL LAWS) IN RESPECT OF THE CONDUCT OF ITS BUSINESS AND THE OWNERSHIP
OF ITS PROPERTY; AND (D) CAUSE ITS PROPERTY TO BE PROTECTED, MAINTAINED AND KEPT
IN GOOD REPAIR AND MAKE ALL REPLACEMENTS AND ADDITIONS TO ITS PROPERTY AS MAY BE
REASONABLY NECESSARY TO CONDUCT ITS BUSINESS PROPERLY AND EFFICIENTLY.

 

SECTION 5.2  FINANCIAL STATEMENTS AND INFORMATION.  FURNISH TO THE AGENT AND
EACH LENDER COPIES OF EACH OF THE FOLLOWING:  (A) AS SOON AS AVAILABLE AND IN
ANY EVENT WITHIN NINETY (90) DAYS AFTER THE END OF EACH FISCAL YEAR OF THE
COMPANY, ANNUAL AUDITED FINANCIAL STATEMENTS OF THE COMPANY AND ITS
SUBSIDIARIES, PREPARED ON A CONSOLIDATED BASIS; (B) AS SOON AS AVAILABLE AND IN
ANY EVENT WITHIN FORTY-FIVE (45) DAYS AFTER THE END OF EACH QUARTER (EXCLUDING
THE FOURTH QUARTER) OF EACH FISCAL YEAR OF THE COMPANY, QUARTERLY UNAUDITED
FINANCIAL STATEMENTS OF THE COMPANY AND ITS SUBSIDIARIES, PREPARED ON A
CONSOLIDATED BASIS; (C) CONCURRENTLY WITH THE FINANCIAL STATEMENTS PROVIDED FOR
IN CLAUSES (A) AND (B) HEREOF, AN OFFICER’S CERTIFICATE WHICH SHALL INCLUDE SUCH
SCHEDULES, COMPUTATIONS AND OTHER INFORMATION, IN REASONABLE DETAIL, AS MAY BE
REASONABLY REQUIRED BY THE AGENT OR ANY LENDER TO DEMONSTRATE COMPLIANCE WITH
THE COVENANTS SET FORTH HEREIN OR REFLECTING ANY NON-COMPLIANCE THEREWITH AS OF
THE APPLICABLE DATE, ALL CERTIFIED AS TRUE, CORRECT AND COMPLETE BY A
RESPONSIBLE OFFICER OF THE COMPANY; (D) PROMPTLY UPON THEIR BECOMING AVAILABLE,
ALL FINANCIAL STATEMENTS (OTHER THAN THE ANNUAL AUDITED FINANCIAL STATEMENTS AND
QUARTERLY UNAUDITED FINANCIAL STATEMENTS), REGISTRATION STATEMENTS, REPORTS AND
PROXY STATEMENTS WHICH THE COMPANY OR ANY OF ITS SUBSIDIARIES MAY FILE WITH THE
SECURITIES AND EXCHANGE COMMISSION, AND (E) SUCH OTHER INFORMATION RELATING TO
THE FINANCIAL CONDITION AND AFFAIRS OF THE COMPANY AND ANY OF ITS SUBSIDIARIES
AS FROM TIME TO TIME MAY BE REASONABLY REQUESTED BY THE AGENT OR ANY LENDER.  IN
ADDITION TO THE FINANCIAL INFORMATION AND REPORTS TO BE DELIVERED IN ACCORDANCE
WITH THE PRIOR SENTENCE, IF THE MOST RECENT ANNUAL AUDITED FINANCIAL STATEMENTS
OR QUARTERLY UNAUDITED FINANCIAL STATEMENTS OF

 

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THE COMPANY, AS APPLICABLE, DEMONSTRATE THAT THE FINANCIAL CONDITION OF THE
COMPANY AND ITS SUBSIDIARIES, ON A CONSOLIDATED BASIS, HAS BEEN NEGATIVELY
IMPACTED AS AT THE END OF THE IMMEDIATELY PRECEDING FISCAL QUARTER OR FISCAL
YEAR REPRESENTED BY SUCH ANNUAL AUDITED FINANCIAL STATEMENTS OR QUARTERLY
UNAUDITED FINANCIAL STATEMENTS, AS APPLICABLE, FOR ONE OR MORE REASONS (SAID
DETERMINATION OF NEGATIVE IMPACT TO BE MADE BY THE AGENT IN ITS REASONABLE
DISCRETION), UPON THE PERIODIC REQUEST OF THE AGENT (UNTIL THE CONDITIONS
ATTRIBUTABLE TO SUCH NEGATIVE IMPACT HAVE BEEN ADDRESSED AND RECTIFIED TO THE
REASONABLE SATISFACTION OF THE AGENT), THE COMPANY AGREES THAT IT SHALL PROMPTLY
PROVIDE THE AGENT AND THE LENDERS WITH ADDITIONAL INFORMATION RELATING TO THE
FINANCIAL CONDITION AND AFFAIRS OF THE COMPANY AND ITS SUBSIDIARIES AS MAY BE
REASONABLY REQUESTED BY THE AGENT, INCLUDING, BUT NOT LIMITED TO, REPORTS
SETTING OUT IN SUFFICIENT DETAIL THE FINANCIAL PERFORMANCE OF EACH RETAIL
LOCATION FOR ANY AND ALL STORES AND OPERATIONS MAINTAINED BY THE COMPANY AND/OR
ANY OF ITS SUBSIDIARIES.

 

Notwithstanding the foregoing, information required to be delivered pursuant to
clauses (a), (b) and (d) of this Section 5.2 shall be deemed to have been
delivered if such information shall be available on the website of the
Securities and Exchange Commission at http://www.sec.gov and the Company shall
have notified the Agent of the availability of all such financial information;
provided, that the Company shall deliver paper copies of such information to the
Agent or any Lender that reasonably requests such delivery.  Information
required to be delivered pursuant to this Section 5.2 (other than a Notice of
Default) may also be delivered by electronic means pursuant to Section 9.2(b).

 

SECTION 5.3  FINANCIAL TESTS.  (A) HAVE AT ALL TIMES A FIXED CHARGE COVERAGE
RATIO OF NOT LESS THAN 1.50 TO 1.00; AND (B) HAVE AT ALL TIMES A LEVERAGE RATIO
OF NOT MORE THAN 3.00 TO 1.00.

 

SECTION 5.4  INSPECTION.  PERMIT THE AGENT AND THE LENDERS TO INSPECT ITS
PROPERTY, TO EXAMINE ITS FILES, BOOKS AND RECORDS AND MAKE AND TAKE AWAY COPIES
THEREOF, AND TO DISCUSS ITS AFFAIRS WITH ITS OFFICERS AND ACCOUNTANTS, ALL AT
SUCH TIMES AND INTERVALS AND TO SUCH EXTENT AS THE AGENT OR ANY LENDER MAY
REASONABLY DESIRE; PROVIDED THAT, IN THE ABSENCE OF AN EVENT OF DEFAULT, NO MORE
THAN ONE SUCH VISIT SHALL BE PERMITTED AT THE EXPENSE OF THE COMPANY IN ANY
FISCAL YEAR.

 

SECTION 5.5  FURTHER ASSURANCES.  PROMPTLY EXECUTE AND DELIVER ANY AND ALL OTHER
AND FURTHER INSTRUMENTS WHICH MAY BE REQUESTED BY THE AGENT OR ANY LENDER TO
CURE ANY DEFECT IN THE EXECUTION AND DELIVERY OF ANY LOAN DOCUMENT OR MORE FULLY
TO DESCRIBE PARTICULAR ASPECTS OF THE COMPANY’S AGREEMENTS SET FORTH IN THE LOAN
DOCUMENTS OR SO INTENDED TO BE.

 

SECTION 5.6  BOOKS AND RECORDS.  MAINTAIN BOOKS OF RECORD AND ACCOUNT IN
ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.

 

SECTION 5.7  INSURANCE.  MAINTAIN AT ALL TIMES INSURANCE WITH SUCH INSURERS, ON
SUCH OF ITS PROPERTY, OFFICERS, DIRECTORS AND EMPLOYEES, IN SUCH AMOUNTS AND
AGAINST SUCH RISKS AS IS CUSTOMARILY MAINTAINED BY OTHER PERSONS OF SIMILAR SIZE
AND ENGAGED IN BUSINESSES SUBSTANTIALLY SIMILAR TO ITS BUSINESSES, AND FURNISH
THE AGENT SATISFACTORY EVIDENCE THEREOF PROMPTLY UPON REQUEST.

 

SECTION 5.8  ERISA.  AT ALL TIMES:  (A) MAKE CONTRIBUTIONS TO EACH PLAN IN A
TIMELY MANNER AND IN AN AMOUNT SUFFICIENT TO COMPLY WITH THE MINIMUM FUNDING
STANDARDS REQUIREMENTS OF ERISA; (B) IMMEDIATELY UPON ACQUIRING KNOWLEDGE OF
(I) ANY REPORTABLE EVENT IN CONNECTION WITH ANY PLAN FOR WHICH NO ADMINISTRATIVE
OR STATUTORY EXEMPTION EXISTS OR (II) ANY “PROHIBITED TRANSACTION”, AS SUCH TERM
IS DEFINED IN SECTION 4975 OF THE CODE, IN CONNECTION WITH ANY PLAN, THAT COULD
RESULT IN THE IMPOSITION OF MATERIAL DAMAGES OR A MATERIAL EXCISE TAX ON THE
COMPANY, FURNISH THE AGENT A STATEMENT EXECUTED BY A RESPONSIBLE OFFICER OF THE
COMPANY SETTING FORTH THE DETAILS THEREOF AND THE ACTION WHICH THE COMPANY OR
ANY SUCH SUBSIDIARY PROPOSES TO TAKE WITH RESPECT THERETO AND, WHEN KNOWN, ANY
ACTION

 

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TAKEN BY THE INTERNAL REVENUE SERVICE WITH RESPECT THERETO; (C) NOTIFY THE AGENT
PROMPTLY UPON RECEIPT BY THE COMPANY OR ANY OF ITS SUBSIDIARIES OF ANY NOTICE OF
THE INSTITUTION OF ANY PROCEEDINGS OR OTHER ACTIONS WHICH MAY RESULT IN THE
TERMINATION OF ANY PLAN BY THE PENSION BENEFIT GUARANTY CORPORATION AND FURNISH
THE AGENT WITH COPIES OF SUCH NOTICE; (D) PAY WHEN DUE ALL REQUIRED PREMIUM
PAYMENTS TO THE PENSION BENEFIT GUARANTY CORPORATION; (E) FURNISH THE AGENT WITH
COPIES OF THE ANNUAL REPORT FOR EACH PLAN FILED WITH THE INTERNAL REVENUE
SERVICE NOT LATER THAN TEN (10) DAYS AFTER THE AGENT REQUESTS SUCH REPORT;
(F) FURNISH THE AGENT WITH COPIES OF ANY REQUEST FOR WAIVER OF THE FUNDING
STANDARDS OR EXTENSION OF THE AMORTIZATION PERIODS REQUIRED BY SECTIONS 303 AND
304 OF ERISA OR SECTION 412 OF THE CODE PROMPTLY AFTER THE REQUEST IS SUBMITTED
TO THE SECRETARY OF THE TREASURY, THE DEPARTMENT OF LABOR OR THE INTERNAL
REVENUE SERVICE, AS THE CASE MAY BE; AND (G) PAY WHEN DUE ALL INSTALLMENT
CONTRIBUTIONS REQUIRED UNDER SECTION 302 OF ERISA OR SECTION 412 OF THE CODE OR
WITHIN 10 DAYS OF A FAILURE TO MAKE ANY SUCH REQUIRED CONTRIBUTIONS FURNISH THE
AGENT WITH WRITTEN NOTICE OF SUCH FAILURE.

 

SECTION 5.9  USE OF PROCEEDS.  SUBJECT TO THE TERMS AND CONDITIONS CONTAINED
HEREIN, USE THE PROCEEDS OF THE LOANS (A) TO FINANCE THE TENDER OFFER AND THE
MERGER, (B) TO REFINANCE CERTAIN EXISTING INDEBTEDNESS OF THE TARGET, (C) TO PAY
COSTS AND EXPENSES RELATING TO THE TRANSACTIONS, AND (D) SUPPORT NEW STORE
DEVELOPMENT, OTHER ACQUISITIONS, THE ISSUANCE OF STANDBY LETTERS OF CREDIT AND
OTHER GENERAL CORPORATE PURPOSES, INCLUDING BUT NOT LIMITED TO, DIVIDEND
PAYMENTS AND THE REPURCHASE OF STOCK.  NO PROCEEDS OF THE LOANS SHALL BE USED IN
VIOLATION OF REGULATION U OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE
SYSTEM OR ANY SUCCESSOR REGULATION THEREOF OR OF ANY OTHER RULE, STATUTE OR
REGULATION GOVERNING MARGIN STOCK FROM TIME TO TIME.

 

SECTION 5.10   ADDITIONAL GUARANTIES.  NOTIFY THE AGENT PROMPTLY UPON CREATION
OR ACQUISITION BY THE COMPANY OR ANY OF ITS SUBSIDIARIES OF ANY ADDITIONAL
SUBSIDIARY OF THE COMPANY AFTER THE DATE HEREOF, AND IN CONNECTION THEREWITH,
FURNISH THE AGENT WITH THE ORGANIZATIONAL DOCUMENTS OF SUCH NEWLY ACQUIRED OR
CREATED SUBSIDIARY AND SUFFICIENT INFORMATION TO DISCLOSE TO THE AGENT IN
REASONABLE DETAIL THE OWNERSHIP STRUCTURE AND CAPITALIZATION OF SUCH SUBSIDIARY,
AND, EXCEPT WITH RESPECT TO A NON-GUARANTOR SUBSIDIARY, PROMPTLY CAUSE SUCH
NEWLY CREATED OR ACQUIRED SUBSIDIARY OF THE COMPANY TO EXECUTE AND DELIVER TO
THE AGENT, FOR THE RATABLE BENEFIT OF THE LENDERS AND THE LENDERS UNDER THE TERM
LOAN FACILITY, A JOINDER AGREEMENT, TOGETHER WITH SUCH RELATED CERTIFICATES,
OPINIONS, AND DOCUMENTS AS THE AGENT OR ANY LENDER MAY REASONABLY REQUIRE.

 

SECTION 5.11  NOTICE OF EVENTS.  NOTIFY THE AGENT IMMEDIATELY UPON ACQUIRING
KNOWLEDGE OF THE OCCURRENCE OF, OR IF THE COMPANY OR ANY OF ITS SUBSIDIARIES
CAUSES OR INTENDS TO CAUSE, AS THE CASE MAY BE:  (1) THE INSTITUTION OF ANY
LAWSUIT OR ADMINISTRATIVE PROCEEDING AFFECTING THE COMPANY OR ANY OF ITS
SUBSIDIARIES, THE ADVERSE DETERMINATION UNDER WHICH COULD REASONABLY BE EXPECTED
TO HAVE A MATERIAL ADVERSE EFFECT; (2) THE OCCURRENCE OF ANY MATERIAL ADVERSE
EFFECT; (3) ANY EVENT OF DEFAULT OR ANY DEFAULT, TOGETHER WITH A DETAILED
STATEMENT BY AN APPROPRIATE OFFICER OR OTHER RESPONSIBLE PARTY ACCEPTABLE TO THE
AGENT ON BEHALF OF THE COMPANY OF THE STEPS BEING TAKEN TO CURE THE EFFECT OF
SUCH EVENT OF DEFAULT OR DEFAULT; (4) THE OCCURRENCE OF A DEFAULT OR EVENT OF
DEFAULT BY THE COMPANY OR ANY OF ITS SUBSIDIARIES UNDER ANY AGREEMENT OR SERIES
OF RELATED AGREEMENTS TO WHICH IT IS A PARTY, WHICH DEFAULT OR EVENT OF DEFAULT
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT; AND (5) ANY
MATERIAL CHANGE IN THE ACCURACY OF THE REPRESENTATIONS AND WARRANTIES OF THE
COMPANY OR ANY OF ITS SUBSIDIARIES IN THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT.  THE COMPANY WILL NOTIFY, OR CAUSE EACH GUARANTOR TO NOTIFY, THE AGENT
IN WRITING WITHIN 30 DAYS PRIOR TO THE DATE THAT THE COMPANY OR ANY GUARANTOR
CHANGES ITS NAME OR THE LOCATION OF ITS CHIEF EXECUTIVE OFFICE OR PRINCIPAL
PLACE OF BUSINESS OR THE PLACE WHERE IT KEEPS ITS BOOKS AND RECORDS.  ANY NOTICE
OF A NAME CHANGE DELIVERED TO THE AGENT SHALL BE ACCOMPANIED BY SUCH
CERTIFICATES OF GOVERNMENTAL AUTHORITIES AS THE AGENT OR ANY LENDER MAY REQUIRE
SUBSTANTIATING SUCH NAME CHANGE.

 

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SECTION 5.12  ENVIRONMENTAL MATTERS.  WITHOUT LIMITING THE GENERALITY OF
SECTION 5.1(C) HEREOF, (A) COMPLY IN ALL MATERIAL RESPECTS WITH ALL LIMITATIONS,
RESTRICTIONS, CONDITIONS, STANDARDS, PROHIBITIONS, REQUIREMENTS, OBLIGATIONS,
SCHEDULES AND TIMETABLES CONTAINED IN ANY APPLICABLE REQUIREMENT OF
ENVIRONMENTAL LAW OR ENVIRONMENTAL PERMIT; (B) OBTAIN AND MAINTAIN IN EFFECT ALL
ENVIRONMENTAL PERMITS, THE FAILURE TO OBTAIN WHICH COULD REASONABLY BE EXPECTED
TO HAVE A MATERIAL ADVERSE EFFECT; AND (C) KEEP ITS PROPERTY FREE OF ANY
ENVIRONMENTAL CLAIMS OR ENVIRONMENTAL LIABILITIES WHICH COULD REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

SECTION 5.13  END OF FISCAL YEAR.  THE COMPANY SHALL CAUSE EACH OF ITS FISCAL
YEARS AND EACH OF ITS SUBSIDIARIES’ FISCAL YEARS TO END ON THE LAST SUNDAY OF
EACH SEPTEMBER.

 

SECTION 5.14  CONSUMMATION OF MERGER.  THE COMPANY SHALL USE COMMERCIALLY
REASONABLE EFFORTS TO CONSUMMATE THE MERGER WITHIN 90 DAYS FOLLOWING THE
EFFECTIVE DATE.

 

SECTION 5.15  MAINTENANCE OF RATINGS.  THE COMPANY SHALL USE COMMERCIALLY
REASONABLE EFFORTS TO MAINTAIN CORPORATE FAMILY (OR EQUIVALENT) RATINGS FROM
EACH OF MOODY’S AND S&P.

 

SECTION 5.16  COVENANT TO GUARANTEE OBLIGATIONS AND GIVE SECURITY.I.      
EXCEPT IN CONNECTION WITH THE DISCLOSED DIVESTITURES LISTED IN PART A OF
SCHEDULE 1.1(A), THE LOAN PARTIES WILL UPON (X) THE REQUEST OF THE AGENT,
(Y) THE FORMATION OR ACQUISITION OF ANY NEW DIRECT OR INDIRECT SUBSIDIARIES BY
ANY LOAN PARTY OR (Z) THE ACQUISITION OF ANY MATERIAL PROPERTY BY ANY LOAN
PARTY, IN EACH CASE AT THE LOAN PARTIES’ EXPENSE:

 

 (A)          GRANT TO THE COLLATERAL AGENT, FOR THE RATABLE BENEFIT OF THE
LENDERS AND THE LENDERS UNDER THE TERM LOAN FACILITY, AND UPON THE TERMS AND
CONDITIONS SET FORTH IN THE SECURITY AGREEMENT A, A SECURITY INTEREST IN, EACH
LOAN PARTY’S RIGHT, TITLE AND INTEREST IN AND TO THE COLLATERAL PURSUANT TO THE
TERMS OF THE SECURITY AGREEMENT A.

 

(B)           WITHIN 15 DAYS AFTER SUCH REQUEST, FORMATION OR ACQUISITION,
(I) CAUSE EACH SUCH SUBSIDIARY TO DULY EXECUTE AND DELIVER TO THE AGENT SUCH
GUARANTIES OR GUARANTY SUPPLEMENTS SO AS TO CAUSE EACH SUCH SUBSIDIARY TO
GUARANTEE ALL GUARANTEED OBLIGATIONS, AS DEFINED IN THE GUARANTIES, (II) DULY
EXECUTE AND DELIVER, AND CAUSE EACH SUCH SUBSIDIARY AND EACH DIRECT AND INDIRECT
PARENT OF SUCH SUBSIDIARY (IF IT HAS NOT ALREADY DONE SO) TO DULY EXECUTE AND
DELIVER, TO THE COLLATERAL AGENT, PLEDGES, ASSIGNMENTS, SECURITY AGREEMENT
SUPPLEMENTS AND OTHER SECURITY AGREEMENTS, COVERING THE COLLATERAL AND AS
SPECIFIED BY AND IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE AGENT,
SECURING PAYMENT OF ALL THE OBLIGATIONS OF THE APPLICABLE LOAN PARTY OR SUCH
SUBSIDIARY, AS THE CASE MAY BE, UNDER THE LOAN DOCUMENTS AND THE TERM LOAN
FACILITY AND CONSTITUTING LIENS ON ALL COLLATERAL, OR (III) TAKE WHATEVER
ACTION, INCLUDING TO FILE UNIFORM COMMERCIAL CODE FINANCING STATEMENTS, AS MAY
BE NECESSARY OR ADVISABLE IN THE OPINION OF THE AGENT, TO VEST IN THE COLLATERAL
AGENT (OR ITS DESIGNEE), VALID AND SUBSISTING LIENS IN THE COLLATERAL AS
PROVIDED IN THIS SECTION 5.16(B).

 

(C)           WITHIN 60 DAYS AFTER SUCH REQUEST, FORMATION OR ACQUISITION,
DELIVER TO THE AGENT, UPON THE REQUEST OF THE AGENT IN ITS SOLE DISCRETION, A
SIGNED COPY OF A FAVORABLE OPINION, ADDRESSED TO THE COLLATERAL AGENT AND THE
LENDERS, OF COUNSEL FOR THE LOAN PARTIES REASONABLY ACCEPTABLE TO THE AGENT AS
TO THE MATTERS CONTAINED IN CLAUSE (B) ABOVE, AS TO SUCH GUARANTIES, GUARANTY
SUPPLEMENTS, PLEDGES, ASSIGNMENTS, SECURITY AGREEMENT SUPPLEMENTS AND SECURITY
AGREEMENTS BEING LEGAL, VALID AND BINDING OBLIGATIONS OF EACH LOAN PARTY PARTY
THERETO ENFORCEABLE IN ACCORDANCE WITH THEIR TERMS, AS TO THE MATTERS CONTAINED
IN CLAUSE (B)(III) ABOVE, AS TO SUCH RECORDINGS, FILINGS, NOTICES, ENDORSEMENTS
AND OTHER ACTIONS BEING SUFFICIENT TO CREATE VALID PERFECTED LIENS ON SUCH
COLLATERAL TO THE EXTENT A LIEN CAN BE CREATED BY FILING UNDER THE UNIFORM
COMMERCIAL CODE, AND AS TO SUCH OTHER MATTERS AS THE AGENT MAY REASONABLY
REQUEST, IN EACH CASE TO THE EXTENT THAT SUCH COLLATERAL HAS A VALUE IN EXCESS
OF $10,000,000.

 

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(D)           THE LOAN PARTIES WILL, UPON THE INCURRENCE OF INTER-COMPANY DEBT
NOT INCLUDED IN PART II OF SCHEDULE I TO SECURITY AGREEMENT A ON THE EFFECTIVE
DATE, PROMPTLY CAUSE EACH SUBSIDIARY PAYEE UNDER SUCH INTER-COMPANY DEBT TO
EXECUTE AND DELIVER TO THE COLLATERAL AGENT, PLEDGES, ASSIGNMENTS, AND SECURITY
AGREEMENT SUPPLEMENTS AND OTHER SECURITY AGREEMENTS COVERING SUCH COLLATERAL AND
AS SPECIFIED BY AND IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE AGENT,
SECURING PAYMENT OF ALL THE OBLIGATIONS OF THE APPLICABLE LOAN PARTY OR SUCH
SUBSIDIARY, AS THE CASE MAY BE, UNDER THE LOAN DOCUMENTS AND THE TERM LOAN
FACILITY AND CONSTITUTING LIENS ON ALL SUCH COLLATERAL.

 

(E)           AT ANY TIME AND FROM TIME TO TIME, PROMPTLY EXECUTE AND DELIVER
ANY AND ALL FURTHER INSTRUMENTS AND DOCUMENTS AND TAKE ALL SUCH OTHER ACTION AS
THE AGENT MAY REASONABLY DEEM NECESSARY OR DESIRABLE IN OBTAINING THE FULL
BENEFITS OF, OR IN PERFECTING AND PRESERVING THE LIENS OF, SUCH GUARANTIES,
PLEDGES, ASSIGNMENTS, SECURITY AGREEMENT SUPPLEMENTS AND SECURITY AGREEMENTS IN
THE COLLATERAL.

 

SECTION 5.17  COVENANT TO GIVE ADDITIONAL SECURITY.  AT ANY TIME DURING THE
ADDITIONAL SECURITY PERIOD, THE LOAN PARTIES WILL UPON (X) THE REQUEST OF THE
AGENT, (Y) THE FORMATION OR ACQUISITION OF ANY NEW DIRECT OR INDIRECT
SUBSIDIARIES BY ANY LOAN PARTY OR (Z) THE ACQUISITION OF ANY MATERIAL PROPERTY
BY ANY LOAN PARTY, THEN THE LOAN PARTIES SHALL, IN EACH CASE AT THE LOAN
PARTIES’ EXPENSE:

 

(A)           GRANT TO THE COLLATERAL AGENT FOR THE RATABLE BENEFIT OF THE
LENDERS AND THE LENDERS UNDER THE TERM LOAN FACILITY, AND UPON THE TERMS AND
CONDITIONS SET FORTH IN THE SECURITY AGREEMENT B, A SECURITY INTEREST IN, EACH
LOAN PARTY’S RIGHT, TITLE AND INTEREST IN AND TO THE ADDITIONAL COLLATERAL
PURSUANT TO THE TERMS OF THE SECURITY AGREEMENT B.

 

(B)           WITHIN 15 DAYS AFTER SUCH REQUEST, FORMATION OR ACQUISITION, (I) 
DULY EXECUTE AND DELIVER, AND CAUSE EACH SUCH SUBSIDIARY AND EACH DIRECT AND
INDIRECT PARENT OF SUCH SUBSIDIARY (IF IT HAS NOT ALREADY DONE SO) TO DULY
EXECUTE AND DELIVER, TO THE COLLATERAL AGENT, A SUPPLEMENT TO SECURITY AGREEMENT
B, SECURING PAYMENT OF ALL THE OBLIGATIONS OF THE APPLICABLE LOAN PARTY OR SUCH
SUBSIDIARY, AS THE CASE MAY BE, UNDER THE LOAN DOCUMENTS AND THE TERM LOAN
FACILITY AND CONSTITUTING LIENS ON ALL SUCH PROPERTIES, PROVIDED THAT NO REAL
PROPERTY (OR ANY INTEREST THEREIN) SHALL BE SUBJECTED TO A SECURITY INTEREST IN
FAVOR OF THE AGENT FOR THE BENEFIT OF THE LENDERS, OR (II) TAKE WHATEVER ACTION
CONTEMPLATED BY SECURITY AGREEMENT B, INCLUDING TO FILE UNIFORM COMMERCIAL CODE
FINANCING STATEMENTS, AS MAY BE NECESSARY OR ADVISABLE IN THE OPINION OF THE
AGENT TO VEST IN THE COLLATERAL AGENT (OR ITS DESIGNEE) VALID AND SUBSISTING
LIENS AS PROVIDED IN THIS SECTION 5.17(B).

 

(C)           WITHIN 60 DAYS AFTER SUCH REQUEST, FORMATION OR ACQUISITION,
DELIVER TO THE AGENT, UPON THE REQUEST OF THE COLLATERAL AGENT IN ITS SOLE
DISCRETION, A SIGNED COPY OF A FAVORABLE OPINION, ADDRESSED TO THE AGENT AND THE
LENDERS, OF COUNSEL FOR THE LOAN PARTIES REASONABLY ACCEPTABLE TO THE AGENT AS
TO THE MATTERS CONTAINED IN CLAUSES (A) AND (B) ABOVE, AS THE AGENT MAY
REASONABLY REQUEST, IN EACH CASE TO THE EXTENT THAT SUCH ADDITIONAL COLLATERAL
HAS A VALUE IN EXCESS OF $10,000,000.

 

(D)           AT ANY TIME AND FROM TIME TO TIME, PROMPTLY EXECUTE AND DELIVER
ANY AND ALL FURTHER INSTRUMENTS AND DOCUMENTS AND TAKE ALL SUCH OTHER ACTION
CONTEMPLATED UNDER THE SECURITY AGREEMENT B AS THE AGENT MAY REASONABLY DEEM
NECESSARY OR DESIRABLE IN OBTAINING THE FULL BENEFITS OF, OR IN PERFECTING AND
PRESERVING THE LIENS OF, SUCH GUARANTIES, PLEDGES, ASSIGNMENTS, SECURITY
AGREEMENT SUPPLEMENTS, INTELLECTUAL PROPERTY SECURITY AGREEMENT SUPPLEMENTS AND
SECURITY AGREEMENTS.

 

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ARTICLE VI — NEGATIVE COVENANTS

 

The Company covenants and agrees with the Agent and the Lenders that prior to
the termination of this Agreement it will not, and will not suffer or permit any
of its Subsidiaries to, do any of the following:

 

SECTION 6.1  INDEBTEDNESS.  CREATE, INCUR, SUFFER OR PERMIT TO EXIST, OR ASSUME
OR GUARANTEE, DIRECTLY OR INDIRECTLY, OR BECOME OR REMAIN LIABLE WITH RESPECT TO
ANY INDEBTEDNESS, WHETHER DIRECT, INDIRECT, ABSOLUTE, CONTINGENT OR OTHERWISE,
EXCEPT THE FOLLOWING:

 

(A)           INDEBTEDNESS PURSUANT HERETO, THE GUARANTIES AND ANY OTHER LOAN
DOCUMENT;

 

(B)           INDEBTEDNESS UNDER THE TERM LOAN FACILITY IN AN AGGREGATE
PRINCIPAL AMOUNT (AS TO THE LOANS THEREUNDER) NOT TO EXCEED AT ANY TIME
OUTSTANDING THE DIFFERENCE BETWEEN $700,000,000 AND THE AGGREGATE AMOUNT OF ALL
PRINCIPAL PAYMENTS AND PREPAYMENTS MADE UNDER THE TERM LOAN FACILITY AFTER THE
DATE HEREOF;

 

(C)           IN ADDITION TO AND CUMULATIVE OF ANY OTHER INDEBTEDNESS PERMITTED
IN THIS SECTION 6, IN THE CASE OF THE COMPANY ONLY, UNSECURED BORROWED DEBT;
PROVIDED THAT, IMMEDIATELY BEFORE AND IMMEDIATELY AFTER THE INCURRENCE OF SUCH
UNSECURED BORROWED DEBT, THE COMPANY AND ITS SUBSIDIARIES SHALL BE IN PRO FORMA
COMPLIANCE WITH THE FINANCIAL COVENANTS SET FORTH IN SECTION 5.3 HEREOF;

 

(D)           INDEBTEDNESS SECURED BY LIENS PERMITTED BY SECTION 6.2 HEREOF;

 

(E)           SECURED INDEBTEDNESS OF THE COMPANY AND INDEBTEDNESS OF ANY ONE OR
MORE OF THE COMPANY’S SUBSIDIARIES, PROVIDED, THAT THE AGGREGATE AMOUNT OF ALL
SUCH INDEBTEDNESS OUTSTANDING AT ANY TIME (EXCLUSIVE OF INDEBTEDNESS PERMITTED
IN SECTION 6.1(I) HEREOF) MAY NOT EXCEED FIVE PERCENT (5%) OF CONSOLIDATED NET
WORTH;

 

(F)            OTHER LIABILITIES EXISTING ON THE DATE OF THIS AGREEMENT AND SET
FORTH ON SCHEDULE II ATTACHED HERETO, AND ALL RENEWALS AND EXTENSIONS (BUT NOT
INCREASES) THEREOF, PROVIDED THAT THERE SHALL BE NO MATERIAL CHANGE IN THE
OBLIGORS THEREUNDER;

 

(G)           CURRENT ACCOUNTS PAYABLE AND UNSECURED CURRENT LIABILITIES, NOT
THE RESULT OF BORROWINGS, TO VENDORS, SUPPLIERS AND PERSONS PROVIDING SERVICES,
FOR EXPENDITURES ON ORDINARY TRADE TERMS FOR GOODS AND SERVICES NORMALLY
REQUIRED BY THE COMPANY OR ANY OF ITS SUBSIDIARIES IN THE ORDINARY COURSE OF ITS
BUSINESS;

 

(H)           AGREEMENTS OF INTENT TO ACQUIRE A PERSON ISSUED BY THE COMPANY OR
ANY OF ITS SUBSIDIARIES IN ANTICIPATION OF ACQUIRING SUCH PERSON IF SUCH
ACQUISITION IS PERMITTED UNDER THE TERMS AND CONDITIONS OF THIS AGREEMENT;

 

(I)            THE INDEBTEDNESS OF ANY SUBSIDIARY OF THE COMPANY TO THE COMPANY
OR TO ANY GUARANTOR, AS PERMITTED IN SECTION 6.7(F) OF THIS AGREEMENT;

 

(J)            GUARANTEES BY THE COMPANY OR ANY OF ITS SUBSIDIARIES OF THE
INDEBTEDNESS OF ANY OF THEIR RESPECTIVE SUBSIDIARIES PERMITTED TO BE INCURRED,
CREATED OR EXISTING PURSUANT TO SECTION 6.3, PROVIDED, THAT SUCH GUARANTEES ARE
NOT DIRECTLY OR INDIRECTLY SECURED BY ANY LIENS;

 

(K)           CURRENT AND DEFERRED TAXES;

 

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(L)            ANY OBLIGATION UNDER OR IN RESPECT OF OUTSTANDING LETTERS OF
CREDIT (INCLUDING WITHOUT LIMITATION, THE LETTERS OF CREDIT), ACCEPTANCES AND
SIMILAR OBLIGATIONS CREATED FOR THE ACCOUNT OF THE COMPANY OR ANY OF ITS
SUBSIDIARIES, AND ANY HEDGING AGREEMENTS (OTHER THAN CREDIT FACILITY HEDGING
AGREEMENTS) ENTERED INTO BY THE COMPANY AND ITS SUBSIDIARIES IN THE ORDINARY
COURSE; PROVIDED THAT THE SUM OF (I) THE AGGREGATE AMOUNT OF SUCH INDEBTEDNESS
AND (II) THE AGGREGATE AMOUNT OF CONTINGENT OBLIGATIONS OUTSTANDING AT ANY TIME
FOR THE COMPANY AND ITS SUBSIDIARIES, ON A CONSOLIDATED BASIS, MAY NOT EXCEED
FIVE PERCENT (5%) OF CONSOLIDATED NET WORTH;

 

(M)          INDEBTEDNESS OR OTHER OBLIGATIONS OF THE COMPANY UNDER CAPITAL
LEASE OBLIGATIONS FOR EQUIPMENT FOR USE IN NEW RETAIL LOCATIONS HEREAFTER OPENED
AND OPERATED BY THE COMPANY OR ANY OF ITS SUBSIDIARIES, SO LONG AS THE
CAPITALIZED AMOUNT OF SUCH OBLIGATIONS HEREAFTER ENTERED INTO DOES NOT EXCEED
FIVE PERCENT (5%) OF CONSOLIDATED NET WORTH IN THE AGGREGATE, TOGETHER WITH
GUARANTIES OF SUCH OBLIGATIONS BY ANY OR ALL SUBSIDIARIES OF THE COMPANY NOW OR
HEREAFTER EXISTING;

 

(N)           INDEBTEDNESS EVIDENCED BY THOSE CERTAIN ZERO COUPON CONVERTIBLE
SUBORDINATED DEBENTURES OF THE COMPANY DUE 2018 WHICH ARE GOVERNED BY THAT
CERTAIN INDENTURE DATED MARCH 2, 1998, BY AND AMONG THE COMPANY AND CHASE BANK
OF TEXAS, NATIONAL ASSOCIATION, TRUSTEE, OUTSTANDING ON THE DATE HEREOF; AND

 

(O)           INDEBTEDNESS OF TARGET UNDER ITS CONVERTIBLE SENIOR DEBENTURES.

 

(P)           ANY OBLIGATION UNDER OR IN RESPECT OF OUTSTANDING LETTERS OF
CREDIT (EXCLUDING THE LETTERS OF CREDIT) OR OTHER WORKERS’ COMPENSATION COVERAGE
PAYMENT OR REIMBURSEMENT OBLIGATIONS SECURED BY CASH OR CASH EQUIVALENTS CREATED
FOR THE ACCOUNT OF THE COMPANY OR ANY OF ITS SUBSIDIARIES AS FISCAL SECURITY
FOR, OR OTHERWISE IN CONNECTION WITH, WORKERS’ COMPENSATION COVERAGE SECURED FOR
THE COMPANY AND/OR ANY OF ITS SUBSIDIARIES (IT BEING AGREED THAT ANY LETTERS OF
CREDIT OR OTHER SUCH PAYMENT OR REIMBURSEMENT OBLIGATIONS ISSUED IN ACCORDANCE
WITH THE PROVISIONS OF THIS SECTION 6.1(O) SHALL NOT BE INCLUDED WITHIN LETTERS
OF CREDIT FOR PURPOSES OF DETERMINING COMPLIANCE WITH SECTION 6.1(L) HEREOF OR
INCLUDED WITHIN CONTINGENT OBLIGATIONS FOR PURPOSES OF DETERMINING COMPLIANCE
WITH SECTION 6.3 HEREOF).

 

The Company, the Agent, the Lenders and each Guarantor (by its execution of a
Guaranty or a Joinder Agreement) agree that, notwithstanding anything contained
in this Section 6.1, in Section 6.7(f) or in any other provision contained in
this Agreement which may appear to be to the contrary, any and all Indebtedness
of (i) the Company from time to time owed to any Subsidiary of the Company or of
(ii) any Subsidiary of the Company from time to time owed to the Company or to
any Guarantor (together with any and all Liens from time to time securing the
same as permitted by Section 6.2(f) hereof) is hereby made and at all times
hereafter shall be inferior and subordinate in all respects to the Indebtedness
from time to time owing to the Agent or any Lender pursuant hereto and to any
Lien, if any, from time to time hereafter securing any of such Indebtedness
pursuant to the terms hereof.

 

SECTION 6.2  LIENS.  CREATE OR SUFFER TO EXIST ANY LIEN UPON ANY OF ITS PROPERTY
NOW OWNED OR HEREAFTER ACQUIRED, OR ACQUIRE ANY PROPERTY UPON ANY CONDITIONAL
SALE OR OTHER TITLE RETENTION DEVICE OR ARRANGEMENT OR ANY PURCHASE MONEY
SECURITY AGREEMENT; OR IN ANY MANNER DIRECTLY OR INDIRECTLY SELL, ASSIGN, PLEDGE
OR OTHERWISE TRANSFER ANY OF ITS ACCOUNTS OR CONTRACT RIGHTS; PROVIDED, HOWEVER,
THAT THE COMPANY AND ITS SUBSIDIARIES (OR ANY OF THEM) MAY CREATE OR SUFFER TO
EXIST:

 

(A)           LIENS IN EFFECT ON THE DATE HEREOF AND WHICH ARE DESCRIBED ON
SCHEDULE 6.2(A) ATTACHED HERETO, PROVIDED, THAT THE PROPERTY COVERED THEREBY
DOES NOT INCREASE EITHER IN QUANTITY OR VALUE;

 

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(B)           LIENS SECURING ANY INDEBTEDNESS OTHERWISE PERMITTED PURSUANT TO
SECTIONS 6.1(E) AND (L) HEREOF, PROVIDED THAT THE AGGREGATE AMOUNT OF ALL SUCH
SECURED INDEBTEDNESS OUTSTANDING AT ANY TIME MAY NOT EXCEED FIVE PERCENT (5%) OF
CONSOLIDATED NET WORTH;

 

(C)           LIENS IN FAVOR OF THE COLLATERAL AGENT PURSUANT TO THE TERMS OF
SECURITY AGREEMENT A AND/OR SECURITY AGREEMENT B, AS APPLICABLE;

 

(D)           INCIDENTAL LIENS;

 

(E)           PURCHASE MONEY SECURITY INTERESTS AND LIENS IN EQUIPMENT AND/OR
REAL PROPERTY OF THE COMPANY OR ANY OF ITS SUBSIDIARIES IN FAVOR OF THE SELLER
OR SELLERS OF SUCH EQUIPMENT AND/OR REAL PROPERTY OR THEIR SUCCESSORS AND
ASSIGNS, OR PURCHASE MONEY SECURITY INTERESTS AND LIENS IN FAVOR OF ANY
THIRD-PARTY LENDER WHICH LOANED THE MONEY TO PURCHASE ANY SUCH EQUIPMENT AND/OR
REAL PROPERTY TO THE COMPANY OR SUCH SUBSIDIARY, PROVIDED, THAT NEITHER THE
SALES PRICE OF, NOR THE AMOUNT OF ANY LOAN MADE TO ACQUIRE ANY OF, SUCH
EQUIPMENT AND/OR REAL PROPERTY IS GREATER THAN THE FAIR VALUE OF SUCH EQUIPMENT
AND/OR REAL PROPERTY SO ACQUIRED;

 

(F)            LIENS IN FAVOR OF THE COMPANY OR ANY GUARANTOR SECURING ANY
INDEBTEDNESS OWED BY A SUBSIDIARY OF THE COMPANY PERMITTED PURSUANT TO
SECTION 6.1(I) HEREOF;

 

(G)           INFORMATIONAL FILINGS OF FINANCING STATEMENTS AGAINST THE COMPANY
OR ANY OF ITS SUBSIDIARIES BY LESSORS UNDER ANY OPERATING LEASE OR ANY PERMITTED
CAPITAL LEASE OBLIGATION NOW OR HEREAFTER ENTERED INTO BY THE COMPANY OR ANY OF
ITS SUBSIDIARIES WITH ANY LESSOR, SO LONG AS THE APPLICABLE FINANCING STATEMENT
COVERS ONLY THE ASSET OR ASSETS LEASED PURSUANT TO THE APPLICABLE OPERATING
LEASE OR CAPITAL LEASE OBLIGATION; AND

 

(H)           LIENS AGAINST CASH OR CASH EQUIVALENTS OF THE COMPANY AND/OR ANY
OF ITS SUBSIDIARIES SECURING THE OBLIGATIONS OF, UNDER OR IN RESPECT OF
OUTSTANDING LETTERS OF CREDIT OR OTHER WORKERS’ COMPENSATION COVERAGE PAYMENT OR
REIMBURSEMENT OBLIGATIONS OTHERWISE PERMITTED PURSUANT TO SECTION 6.1(O) HEREOF.

 

provided, however, that, notwithstanding anything contained above in this
Section 6.2 to the contrary, in no event may the Company or any Subsidiary of
the Company ever create or suffer to exist any Lien upon any of the Stock of any
of its Subsidiaries, directly or indirectly, in favor of any Person other than
the Agent for the benefit of the Lenders and, subject to subsection (d) above,
under the Term Loan Facility, create or suffer to exist any agreement, whether
oral or in writing, with any Person other than the Agent and the Lenders
pursuant to this Section 6.2, and, subject to subsection (d) above, under the
Term Loan Facility, which would or could prohibit the Company or any of its
Subsidiaries from creating or permitting to exist any Lien in favor of the Agent
or the Lenders for the benefit of all of the Lenders for Indebtedness from time
to time arising under this Agreement.

 

SECTION 6.3  CONTINGENT OBLIGATIONS.  EXCEPT FOR GUARANTIES BY SUBSIDIARIES OF
THE COMPANY WHICH ARE OTHERWISE PERMITTED BY SECTIONS 6.1(L) AND 6.1(M) HEREOF,
AND THE GUARANTIES, CREATE, INCUR, SUFFER OR PERMIT TO EXIST, DIRECTLY OR
INDIRECTLY, ANY CONTINGENT OBLIGATIONS IF SUCH CONTINGENT OBLIGATIONS WOULD
CAUSE THE SUM OF (A) THE AGGREGATE AMOUNT OF CONTINGENT OBLIGATIONS OUTSTANDING
FOR THE COMPANY AND ITS SUBSIDIARIES, AND (B) THE AGGREGATE AMOUNT OF
OUTSTANDING INDEBTEDNESS PERMITTED BY SECTION 6.1(L), ON A CONSOLIDATED BASIS,
TO EXCEED FIVE PERCENT (5%) OF CONSOLIDATED NET WORTH.

 

SECTION 6.4  MERGERS, CONSOLIDATIONS AND DISPOSITIONS AND ACQUISITIONS OF
ASSETS.  IN ANY SINGLE TRANSACTION OR SERIES OF RELATED TRANSACTIONS, DIRECTLY
OR INDIRECTLY:

 

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(A)           WIND UP ITS AFFAIRS, LIQUIDATE OR DISSOLVE;

 

(B)           BE A PARTY TO ANY MERGER OR CONSOLIDATION (OTHER THAN THE MERGER)
AND EXCEPT AS PERMITTED UNDER SECTION 6.4(E);

 

(C)           SELL, CONVEY, LEASE OR OTHERWISE DISPOSE OF ALL OR ANY MATERIAL
PART OF THE ASSETS (EXCEPT FOR THE SALE OF INVENTORY IN THE ORDINARY COURSE OF
BUSINESS) OF THE COMPANY AND/OR ITS SUBSIDIARIES, OR AGREE TO TAKE ANY SUCH
ACTION, IF SUCH SALE, LEASE OR CONVEYANCE OF ASSETS IS NOT OTHERWISE PERMITTED
FOR THE APPLICABLE FISCAL YEAR BY SECTION 6.4(Z) HEREOF;

 

(D)           SELL, ASSIGN, PLEDGE, TRANSFER OR OTHERWISE DISPOSE OF, OR IN ANY
WAY PART WITH CONTROL OF, ANY STOCK OF ANY OF ITS SUBSIDIARIES OR ANY
INDEBTEDNESS OR OBLIGATIONS OF ANY CHARACTER OF ANY OF ITS SUBSIDIARIES, OR
PERMIT ANY SUCH SUBSIDIARY SO TO DO WITH RESPECT TO ANY STOCK OF ANY OTHER
SUBSIDIARY OR ANY INDEBTEDNESS OR OBLIGATIONS OF ANY CHARACTER OF THE COMPANY OR
ANY OF ITS OTHER SUBSIDIARIES, OR PERMIT ANY OF ITS SUBSIDIARIES TO ISSUE ANY
ADDITIONAL STOCK OTHER THAN (I) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES OR
(II) TO PURCHASE OR ACQUIRE FOR A CONSIDERATION ANY STOCK OF THE COMPANY OR ANY
OF ITS OTHER SUBSIDIARIES TO THE EXTENT PERMITTED UNDER SECTION 6.11(A) HEREOF;
OR

 

(E)           TAKE ANY ACTION WITH A VIEW TOWARD DISSOLUTION, LIQUIDATION OR
TERMINATION;

 

provided, however, that:

 

(X)            ANY OF THE COMPANY’S SUBSIDIARIES MAY MERGE OR CONSOLIDATE WITH
ANY ONE OR MORE OF THE COMPANY’S OTHER SUBSIDIARIES, OR WITH ANY OTHER BUSINESS
ENTITY OR BUSINESS ENTITIES; PROVIDED THAT EACH SURVIVING BUSINESS ENTITY AFTER
ANY SUCH MERGER OR CONSOLIDATION SHALL BE A WHOLLY-OWNED SUBSIDIARY OF THE
COMPANY OR OF A WHOLLY-OWNED SUBSIDIARY OF THE COMPANY, AND, PROVIDED, FURTHER,
THAT THE SURVIVING BUSINESS ENTITY SHALL SIMULTANEOUSLY WITH SUCH MERGER,
EXECUTE AND DELIVER TO THE AGENT A NOTICE OF ASSUMPTION, APPROPRIATELY
COMPLETED;

 

(Y)           ANY OF THE COMPANY’S SUBSIDIARIES MAY (I) SELL, TRANSFER OR
OTHERWISE DISPOSE OF ANY STOCK OF THE COMPANY OR ANY OF ITS SUBSIDIARIES TO THE
COMPANY OR ANOTHER SUBSIDIARY OF THE COMPANY OR (II) SELL, LEASE, TRANSFER OR
OTHERWISE DISPOSE OF ANY OF ITS ASSETS TO ANOTHER SUBSIDIARY OF THE COMPANY;
PROVIDED THAT IF ALL OR SUBSTANTIALLY ALL OF THE TRANSFERRING SUBSIDIARY’S
ASSETS ARE BEING SOLD, LEASED, TRANSFERRED OR OTHERWISE DISPOSED OF, THEN THE
SUBSIDIARY TO WHOM THE SALE, LEASE, TRANSFER OR DISPOSITION WAS MADE MUST,
UNLESS IT IS ALREADY A GUARANTOR, SIMULTANEOUSLY EXECUTE AND DELIVER TO THE
AGENT A NOTICE OF ASSUMPTION.  IF SUCH TRANSFERRING SUBSIDIARY IS A WHOLLY-OWNED
SUBSIDIARY OF THE COMPANY, IT MAY WIND UP ITS AFFAIRS, LIQUIDATE OR DISSOLVE
FOLLOWING THE CONSUMMATION OF ANY SUCH SALE, LEASE, TRANSFER OR DISPOSAL OF ALL
OR SUBSTANTIALLY ALL OF ITS ASSETS; AND

 

(Z)            SUBJECT TO THE LIMITATIONS SET FORTH BELOW, (I) (A) A PROPOSED
SALE, LEASE OR CONVEYANCE OF ASSETS OF ONE OR MORE OF THE SUBSIDIARIES OF THE
COMPANY (A “PERMITTED ASSET DISPOSITION”) OR (B) A PROPOSED SALE OF THE STOCK OF
ONE OR MORE SUBSIDIARIES OF THE COMPANY (A “PERMITTED STOCK DISPOSITION”), IN A
SINGLE TRANSACTION OR SERIES OF RELATED TRANSACTIONS, TO A PERSON OR PERSONS
WHICH IS NOT OR ARE NOT AN AFFILIATE OR AFFILIATES OF THE COMPANY OR ANY OF ITS
SUBSIDIARIES, ON AN ARMS-LENGTH BASIS, MAY OCCUR IN ANY FISCAL YEAR OF THE
COMPANY SO LONG AS THE AGGREGATE CONSIDERATION PAID BY SUCH ACQUIRING PERSON OR
PERSONS (INCLUSIVE OF THE FAIR VALUE OF ANY NON-CASH PROPERTY RECEIVED AS
CONSIDERATION) FROM ALL PERMITTED ASSET DISPOSITIONS AND ALL PERMITTED STOCK
DISPOSITIONS WHICH OCCUR DURING SUCH FISCAL YEAR DOES NOT EXCEED FIVE PERCENT
(5%) OF CONSOLIDATED NET WORTH AND (II) THE COMPANY MAY CONSUMMATE THE DISCLOSED
DIVESTITURES; PROVIDED, HOWEVER, THAT NO PERMITTED ASSET DISPOSITION (OTHER THAN
A DISCLOSED

 

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DIVESTITURE) OR PERMITTED STOCK DISPOSITION MAY OCCUR IF A DEFAULT SHALL HAVE
THEN OCCURRED AND IS THEN CONTINUING OR WOULD BE CAUSED BY SUCH PROPOSED
PERMITTED ASSET DISPOSITION OR PERMITTED STOCK DISPOSITION, IN EACH CASE IF
CONSUMMATED; PROVIDED FURTHER THAT THE ABILITY TO CONSUMMATE SUCH DISCLOSED
DIVESTITURE SHALL NOT CONSTITUTE A WAIVER OF ANY SUCH DEFAULT.

 

SECTION 6.5  NATURE OF BUSINESS.  MATERIALLY CHANGE THE NATURE OF ITS BUSINESS
OR ENTER INTO ANY BUSINESS WHICH IS SUBSTANTIALLY DIFFERENT FROM THE BUSINESS IN
WHICH IT IS PRESENTLY ENGAGED; PROVIDED, HOWEVER, THAT VERTICAL INTEGRATION
WITHIN THE NATURAL FOODS INDUSTRY SHALL NOT BE DEEMED TO BE A VIOLATION OF THIS
SECTION 6.5.

 

SECTION 6.6  TRANSACTIONS WITH RELATED PARTIES.  ENTER INTO ANY TRANSACTION,
CONTRACT OR AGREEMENT OF ANY KIND WITH ANY OFFICER, DIRECTOR OR HOLDER OF ANY OF
THE OUTSTANDING STOCK OF THE COMPANY OR ANY OF ITS SUBSIDIARIES (OR ANY
AFFILIATE OF SUCH PERSON), UNLESS SUCH TRANSACTION, CONTRACT OR AGREEMENT IS
MADE UPON TERMS AND CONDITIONS NOT LESS FAVORABLE TO SUCH PERSON THAN THOSE
WHICH COULD HAVE BEEN OBTAINED FROM WHOLLY INDEPENDENT AND UNRELATED SOURCES. 
OTHER THAN PURSUANT TO AGREEMENTS OF THE TARGET IN EFFECT ON THE DATE HEREOF,
THE COMPANY WILL NOT PERMIT THE COMPENSATION OF ANY OFFICER, STOCKHOLDER,
DIRECTOR, PARTNER OR PROPRIETOR OF THE COMPANY OR ANY OF ITS SUBSIDIARIES TO BE
EXCESSIVE, TAKING INTO CONSIDERATION THE FINANCIAL CIRCUMSTANCES OF THE COMPANY
OR SUCH SUBSIDIARY AND THE POSITION AND QUALIFICATIONS OF SUCH PERSON.

 

SECTION 6.7  LOANS AND INVESTMENTS.  MAKE, DIRECTLY OR INDIRECTLY, ANY LOAN OR
ADVANCE TO OR HAVE ANY INVESTMENT IN ANY PERSON, OR MAKE ANY COMMITMENT TO MAKE
SUCH LOAN, ADVANCE OR INVESTMENT, EXCEPT:

 

(A)           STOCK OF ANY SUBSIDIARY, SUBJECT TO THE TERMS OF SECTION 6.7(H) AS
TO INVESTMENTS IN INTERNET STRATEGY LINES OF BUSINESS;

 

(B)           PERMITTED INVESTMENT SECURITIES;

 

(C)           STOCK RECEIVED IN THE SETTLEMENT OF DEBTS (CREATED IN THE ORDINARY
COURSE OF BUSINESS);

 

(D)           TRAVEL ADVANCES IN THE ORDINARY COURSE OF BUSINESS TO OFFICERS AND
EMPLOYEES;

 

(E)           CUSTOMER OBLIGATIONS AND RECEIVABLES OWING TO THE COMPANY AND
ARISING OUT OF SALES OR LEASES MADE OR THE RENDERING OF SERVICES BY THE COMPANY
IN THE ORDINARY COURSE OF BUSINESS;

 

(F)            SO LONG AS NO DEFAULT SHALL HAVE OCCURRED AND IS THEN CONTINUING,
AND SUBJECT TO THE TERMS OF SECTION 6.1 HEREOF, LOANS BY THE COMPANY OR ANY
GUARANTOR TO ANY SUBSIDIARY OF THE COMPANY;

 

(G)           SO LONG AS NO DEFAULT HAS OCCURRED AND IS THEN CONTINUING OR WOULD
RESULT THEREFROM, LOANS TO ANY PERSON WHICH IS NOT A SUBSIDIARY OF THE COMPANY
OR OF ANY OF THE COMPANY’S SUBSIDIARIES, PROVIDED, THAT THE AGGREGATE OF ALL OF
SUCH LOANS DOES NOT EXCEED AT ANY TIME FIVE PERCENT (5%) OF CONSOLIDATED NET
WORTH; AND

 

(H)           SO LONG AS NO DEFAULT SHALL HAVE OCCURRED AND IS THEN CONTINUING
OR WOULD RESULT THEREFROM, INVESTMENTS BY THE COMPANY AND/OR ANY GUARANTOR IN
INTERNET STRATEGY LINES OF BUSINESS.

 

SECTION 6.8  ERISA COMPLIANCE.  AT ANY TIME PERMIT ANY PLAN TO ENGAGE IN ANY
“PROHIBITED TRANSACTION” AS DEFINED IN ERISA; INCUR ANY “ACCUMULATED FUNDING
DEFICIENCY” AS DEFINED IN

 

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ERISA; OR BE TERMINATED IN A MANNER WHICH COULD RESULT IN THE IMPOSITION OF A
LIEN ON ANY PROPERTY OF THE COMPANY OR ANY OF ITS SUBSIDIARIES PURSUANT TO
ERISA.

 

SECTION 6.9  CREDIT EXTENSIONS.  EXTEND CREDIT OTHER THAN NORMAL AND PRUDENT
EXTENSIONS OF CREDIT TO CUSTOMERS FOR GOODS AND SERVICES IN THE ORDINARY COURSE
OF BUSINESS.

 

SECTION 6.10  CHANGE IN ACCOUNTING METHOD.  MAKE ANY MATERIAL CHANGE IN
ACCOUNTING METHOD EXCEPT AS MAY BE REQUIRED BY GENERALLY ACCEPTED ACCOUNTING
PRINCIPLES AS THEY ARE FROM TIME TO TIME IN EFFECT.

 

SECTION 6.11  REDEMPTION, DIVIDENDS AND DISTRIBUTIONS.  AT ANY TIME (1) EACH OF
THE COMPANY’S MOODY’S AND S&P RATING  HAVE BEEN DOWNGRADED BELOW INVESTMENT
GRADE, OR (2) EITHER OF THE COMPANY’S MOODY’S OR S&P RATING HAS BEEN DOWNGRADED
BY AT LEAST TWO CATEGORIES BELOW INVESTMENT GRADE:

 

(A)           REDEEM, RETIRE OR OTHERWISE ACQUIRE, DIRECTLY OR INDIRECTLY, ANY
SHARES OF ITS STOCK IF SUCH REDEMPTION OR REPURCHASE WOULD CAUSE THE SUM OF
(A) AND (B) BELOW TO EXCEED THE SUM OF (I) $150,000,000, PLUS (II) FIFTY PERCENT
(50%) OF THE AGGREGATE OF NET INCOME, DEPRECIATION, AMORTIZATION AND NON-CASH
STOCK COMPENSATION EXPENSE OF THE COMPANY AND ITS SUBSIDIARIES, ON A
CONSOLIDATED BASIS, FOR EACH FISCAL QUARTER OF THE COMPANY ENDING AFTER
AUGUST 28, 2007 (SAID AMOUNT TO NOT BE ADJUSTED OR CHANGED FOR A PARTICULAR
FISCAL QUARTER IF THE AGGREGATE NET INCOME, DEPRECIATION, AMORTIZATION AND
NON-CASH STOCK COMPENSATION EXPENSE OF THE COMPANY AND ITS SUBSIDIARIES, ON A
CONSOLIDATED BASIS, FOR SUCH FISCAL QUARTER IS NEGATIVE):  (A) THE AGGREGATE
COST PAID BY THE COMPANY FOR SUCH STOCK SO REDEEMED OR REPURCHASED ON OR AFTER
JULY 1, 2007, AS SHOWN ON THE CONSOLIDATED FINANCIAL STATEMENTS OF THE COMPANY
AND ITS SUBSIDIARIES TO BE DELIVERED PURSUANT TO SECTIONS 5.2(A) AND (B) HEREOF;
AND (B) THE AGGREGATE CASH DIVIDENDS PAID BY THE COMPANY TO OWNERS OF STOCK IN
THE COMPANY ON OR AFTER JULY 1, 2007;

 

(B)           PAY ANY DIVIDEND EXCEPT (I) DIVIDENDS PAID TO THE COMPANY OR ANY
SUBSIDIARY OF THE COMPANY WHICH IS A DIRECT PARENT OF THE SUBSIDIARY PAYING A
DIVIDEND, (II) DIVIDENDS PAYABLE IN STOCK OR IN RIGHTS OR WARRANTS TO PURCHASE
STOCK, OR (III) CASH DIVIDENDS PAID BY THE COMPANY TO OWNERS OF STOCK IN THE
COMPANY IF THE AGGREGATE AMOUNT OF SUCH CASH DIVIDENDS PAYABLE BY THE COMPANY TO
OWNERS OF STOCK IN THE COMPANY ON OR AFTER AUGUST 28, 2007, TOGETHER WITH THE
AGGREGATE COST PAID BY THE COMPANY FOR STOCK REDEEMED OR REPURCHASED ON OR AFTER
JULY 1, 2007 (AS SHOWN ON THE CONSOLIDATED FINANCIAL STATEMENTS OF THE COMPANY
AND ITS SUBSIDIARIES TO BE DELIVERED PURSUANT TO SECTIONS 5.2(A) AND
(B) HEREOF), DOES NOT EXCEED (I) $150,000,000 PLUS (II) FIFTY PERCENT (50%) OF
THE AGGREGATE OF NET INCOME, DEPRECIATION, AMORTIZATION AND NON-CASH STOCK
COMPENSATION EXPENSE OF THE COMPANY AND ITS SUBSIDIARIES, ON A CONSOLIDATED
BASIS, FOR EACH FISCAL QUARTER OF THE COMPANY ENDING AFTER JULY 1, 2007 (SAID
AMOUNT TO NOT BE ADJUSTED OR CHANGED FOR A PARTICULAR FISCAL QUARTER IF THE
AGGREGATE NET INCOME, DEPRECIATION, AMORTIZATION AND NON-CASH STOCK COMPENSATION
EXPENSE OF THE COMPANY AND ITS SUBSIDIARIES, ON A CONSOLIDATED BASIS, FOR SUCH
FISCAL QUARTER IS NEGATIVE); OR

 

(C)           MAKE ANY OTHER DISTRIBUTION OF ANY PROPERTY OR CASH TO
STOCKHOLDERS AS SUCH, EXCEPT AS PERMITTED UNDER SECTION 6.4(E)(Y).

 

ARTICLE VII — EVENTS OF DEFAULT AND REMEDIES

 

SECTION 7.1  EVENTS OF DEFAULT.  IF ANY OF THE FOLLOWING EVENTS SHALL OCCUR,
THEN THE AGENT MAY, UNLESS DIRECTED TO THE CONTRARY BY THE REQUIRED LENDERS IN
WRITING ACTUALLY RECEIVED BY THE AGENT PRIOR TO THE AGENT DOING SO (AND, IF
DIRECTED BY THE REQUIRED LENDERS, SHALL), DO ANY OR ALL OF THE FOLLOWING: 
(1) WITHOUT NOTICE TO THE COMPANY OR ANY OTHER PERSON, DECLARE THE LOANS AND THE
NOTES THEN OUTSTANDING TO BE, AND THEREUPON THE LOANS AND THE NOTES SHALL
FORTHWITH BECOME, IMMEDIATELY DUE AND

 

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PAYABLE, TOGETHER WITH ALL ACCRUED INTEREST THEREON, THE COMMITMENT FEES AND ALL
OTHER AMOUNTS THEN PAYABLE HEREUNDER, WITHOUT NOTICE OF ANY KIND, NOTICE OF
ACCELERATION OR OF INTENTION TO ACCELERATE, PRESENTMENT AND DEMAND OR PROTEST,
OR OTHER NOTICE OF ANY KIND ALL OF WHICH ARE HEREBY EXPRESSLY WAIVED BY THE
COMPANY; (2) WITHOUT NOTICE TO THE COMPANY, TERMINATE THE COMMITMENTS AND
THEREUPON EACH ISSUER AND ALL OF THE LENDERS SHALL BE RELIEVED OF ANY OBLIGATION
TO ISSUE ANY ADDITIONAL LETTERS OF CREDIT OR MAKE ANY ADDITIONAL LOANS; (3) BY
NOTICE IN WRITING TO THE COMPANY, ACCELERATE THE MATURITY DATE TO A DATE AS
EARLY AS THE DATE OF THE NOTICE, (4) DEMAND THAT THE COMPANY AND THE GUARANTORS
PROVIDE THE AGENT, FOR THE RATABLE BENEFIT OF THE LENDERS, AND THE COMPANY AND
THE GUARANTORS JOINTLY AND SEVERALLY AGREE UPON SUCH DEMAND TO, PROVIDE CASH
COLLATERAL IN AN AMOUNT EQUAL TO THE AGGREGATE LETTER OF CREDIT EXPOSURE AMOUNT
THEN OUTSTANDING, ON TERMS AND PURSUANT TO DOCUMENTS AND AGREEMENTS SATISFACTORY
IN ALL RESPECTS TO THE AGENT, AND (5) EXERCISE ANY AND ALL OTHER RIGHTS PURSUANT
TO THE LOAN DOCUMENTS:

 

(A)           THE COMPANY SHALL FAIL TO PAY OR PREPAY ANY PRINCIPAL OF OR
INTEREST OF ANY LOAN, THE COMMITMENT FEES OR ANY OTHER OBLIGATION HEREUNDER OR
UNDER ANY APPLICATIONS AS AND WHEN DUE AND, SOLELY IN RESPECT OF INTEREST, FEES
AND OBLIGATIONS OTHER THAN PRINCIPAL, SUCH FAILURE REMAINS UNCURED AFTER THREE
(3) BUSINESS DAYS, IN THE CASE OF INTEREST, AND FIVE (5) BUSINESS DAYS, IN THE
CASE OF FEES AND SUCH OTHER OBLIGATIONS, IN EACH CASE FROM SUCH DUE DATE; OR

 

(B)           THE COMPANY OR ANY OF ITS SUBSIDIARIES (I) SHALL FAIL TO PAY AT
MATURITY, OR WITHIN ANY APPLICABLE PERIOD OF GRACE, ANY PRINCIPAL OF OR INTEREST
ON ANY OTHER BORROWED MONEY OBLIGATION IN EXCESS OF $20,000,000 IN PRINCIPAL
AMOUNT (UNLESS SUCH PAYMENT IS BEING CONTESTED IN GOOD FAITH BY APPROPRIATE
PROCEEDINGS AND ADEQUATE RESERVES HAVE BEEN PROVIDED THEREFOR), (II) SHALL
OTHERWISE BE IN DEFAULT UNDER THE PROVISIONS OF ANY INSTRUMENT OR DOCUMENT
EVIDENCING, SECURING OR GUARANTEEING ANY OTHER BORROWED MONEY OBLIGATION OF THE
COMPANY OR ANY OF ITS SUBSIDIARIES, INCLUDING, WITHOUT LIMITATION, IN RESPECT OF
THE TERM LOAN FACILITY, IN EXCESS OF $20,000,000 IN PRINCIPAL AMOUNT IF SUCH
DEFAULT CONTINUES BEYOND ANY APPLICABLE GRACE OR CURATIVE PERIOD, IF ANY, AND
SUCH DEFAULT WOULD ENTITLE THE HOLDER OF SUCH BORROWED MONEY OBLIGATION TO
DECLARE SUCH OBLIGATION TO BE DUE PRIOR TO ITS STATED MATURITY, OR (III) IS IN
DEFAULT UNDER OR IN VIOLATION OF ANY LEGAL REQUIREMENT, WHICH FAILURE COULD OR
DOES HAVE A MATERIAL ADVERSE EFFECT; OR

 

(C)           ANY REPRESENTATION OR WARRANTY MADE IN CONNECTION WITH ANY LOAN
DOCUMENT SHALL PROVE TO HAVE BEEN MATERIALLY INCORRECT, FALSE OR MISLEADING WHEN
MADE OR DEEMED TO HAVE BEEN MADE; OR

 

(D)           DEFAULT SHALL OCCUR IN THE PUNCTUAL AND COMPLETE PERFORMANCE OF
(I) ANY OF THE AFFIRMATIVE COVENANTS CONTAINED IN SECTION 5 (OTHER THAN
SECTION 5.3) AND SUCH DEFAULT SHALL NOT BE CURED WITHIN TEN (10) DAYS AFTER THE
AGENT HAS GIVEN WRITTEN NOTICE TO THE COMPANY THAT SUCH DEFAULT HAS OCCURRED (OR
IMMEDIATELY IN THE CASE OF SECTIONS 5.14, 5.16, OR 5.17), (II) ANY OF THE
NEGATIVE COVENANTS CONTAINED IN SECTION 6, OR (III) ANY COVENANT CONTAINED IN
SECTION 5.3 OR ANY OTHER COVENANT OF THE COMPANY OR ANY OTHER PERSON CONTAINED
IN ANY LOAN DOCUMENT; OR

 

(E)           ANY JUDGMENTS OR ORDERS IN THE AGGREGATE FOR THE PAYMENT OF MONEY
IN EXCESS OF $20,000,000 SHALL BE RENDERED AGAINST THE COMPANY OR ANY OF ITS
SUBSIDIARIES AT ANY TIME, REGARDLESS OF WHETHER THE SAME IS BEING APPEALED OR
RESERVES ESTABLISHED THEREFOR OR PAID IN FULL;  PROVIDED, HOWEVER, THAT ANY SUCH
JUDGMENT OR ORDER SHALL NOT GIVE RISE TO AN EVENT OF DEFAULT UNDER THIS
SECTION 7.1(E) IF AND FOR SO LONG AS THE AMOUNT OF SUCH JUDGMENT OR ORDER IS
COVERED BY A VALID AND BINDING POLICY OF INSURANCE IN FAVOR OF THE COMPANY OR
ANY OF ITS SUBSIDIARIES AS TO WHICH COVERAGE IN RESPECT OF SUCH CLAIM HAS NOT
BEEN DISPUTED; OR

 

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(F)            THE COMPANY OR ANY SUBSIDIARY OF THE COMPANY SHALL CLAIM, OR ANY
COURT SHALL FIND OR RULE, THAT THE AGENT FOR THE BENEFIT OF THE LENDERS DOES NOT
HAVE A VALID LIEN ON ANY COLLATERAL OR ADDITIONAL COLLATERAL, AS THE CASE MAY
BE, HAVING A VALUE IN THE AGGREGATE IN EXCESS OF $5,000,000 WHICH MAY HAVE BEEN
PROVIDED TO SECURE THE INDEBTEDNESS ARISING PURSUANT HERETO FROM TIME TO TIME BY
THE COMPANY OR ANY OF ITS SUBSIDIARIES; OR

 

(G)           ANY ORDER SHALL BE ENTERED IN ANY PROCEEDING AGAINST THE COMPANY
OR ANY OF ITS SUBSIDIARIES DECREEING THE DISSOLUTION, LIQUIDATION OR SPLIT-UP
THEREOF, AND SUCH ORDER SHALL REMAIN IN EFFECT FOR THIRTY (30) DAYS; PROVIDED,
HOWEVER, THE PROVISIONS OF THIS SUBPARAGRAPH (G) SHALL NOT APPLY TO ANY
DIVESTITURE BY THE COMPANY OR ANY OF ITS SUBSIDIARIES OF ANY SUBSIDIARY ACQUIRED
AFTER THE EFFECTIVE DATE OF THIS AGREEMENT AS A RESULT OF ANTI-TRUST ISSUES OR
CONCERNS; OR

 

(H)           THE OCCURRENCE OF AN EVENT OF DEFAULT OR DEFAULT UNDER ANY LOAN
DOCUMENT OTHER THAN THIS AGREEMENT; OR

 

(I)            THE COMPANY OR ANY OF ITS SUBSIDIARIES SHALL HAVE CONCEALED,
REMOVED, OR PERMITTED TO BE CONCEALED OR REMOVED, ANY PART OF ITS PROPERTY, WITH
INTENT TO HINDER, DELAY OR DEFRAUD ITS CREDITORS OR ANY OF THEM, OR MADE OR
SUFFERED A TRANSFER OF ANY OF ITS PROPERTY WHICH MAY BE FRAUDULENT UNDER ANY
BANKRUPTCY, FRAUDULENT CONVEYANCE OR SIMILAR LAW; OR SHALL HAVE MADE ANY
TRANSFER OF ITS PROPERTY TO OR FOR THE BENEFIT OF A CREDITOR AT A TIME WHEN
OTHER CREDITORS SIMILARLY SITUATED HAVE NOT BEEN PAID; OR

 

(J)            A CHANGE SHALL OCCUR IN THE ASSETS, LIABILITIES, FINANCIAL
CONDITION, BUSINESS OR AFFAIRS OF THE COMPANY OR ANY OF ITS SUBSIDIARIES WHICH,
IN THE REASONABLE OPINION OF THE REQUIRED LENDERS, WOULD OR DOES HAVE A MATERIAL
ADVERSE EFFECT; PROVIDED, HOWEVER, THE OCCURRENCE OF ANY SUCH MATERIAL ADVERSE
EFFECT SHALL NOT BE DEEMED TO BE AN EVENT OF DEFAULT HEREUNDER UNTIL THE AGENT
SHALL HAVE PROVIDED THE COMPANY WITH WRITTEN NOTICE THAT THE REQUIRED LENDERS
HAVE DETERMINED THAT SUCH A MATERIAL ADVERSE EFFECT HAS OCCURRED; OR

 

(K)           A CHANGE OF CONTROL SHALL OCCUR.

 

In addition to the actions permitted to be taken by the Agent under the terms of
the initial paragraph of this Section 7.1, if any of the following events shall
occur, then the Loans and the Notes together with all accrued interest thereon,
the Commitment Fees and all other amounts then payable hereunder (including
contingent obligations with respect to Letters of Credit) shall automatically,
without demand, presentment, protest, notice of intent to accelerate, notice of
acceleration or other notice to any Person of any kind, all of which are hereby
expressly WAIVED by the Company, become immediately due and payable and all
Commitments shall be immediately and automatically terminated and the Maturity
Date shall immediately and automatically be accelerated to the date of such
occurrence:

 

(X)            THE COMPANY OR ANY OF ITS SUBSIDIARIES SHALL MAKE A GENERAL
ASSIGNMENT FOR THE BENEFIT OF CREDITORS OR SHALL PETITION OR APPLY TO ANY
TRIBUNAL FOR THE APPOINTMENT OF A TRUSTEE, CUSTODIAN, RECEIVER OR LIQUIDATOR OF
ALL OR ANY SUBSTANTIAL PART OF ITS BUSINESS, ESTATE OR ASSETS OR SHALL COMMENCE
ANY PROCEEDING UNDER ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY,
READJUSTMENT OF DEBT, DISSOLUTION OR LIQUIDATION LAW OF ANY JURISDICTION,
WHETHER NOW OR HEREAFTER IN EFFECT; OR

 

(Y)           ANY SUCH PETITION OR APPLICATION SHALL BE FILED OR ANY SUCH
PROCEEDING SHALL BE COMMENCED AGAINST THE COMPANY OR ANY OF ITS SUBSIDIARIES AND
THE COMPANY OR SUCH SUBSIDIARY BY ANY ACT OR OMISSION SHALL INDICATE APPROVAL
THEREOF, CONSENT THERETO OR ACQUIESCENCE THEREIN WHICH SHALL NOT HAVE BEEN
DISMISSED WITHIN 60 DAYS, OR AN ORDER SHALL BE ENTERED APPOINTING A

 

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TRUSTEE, CUSTODIAN, RECEIVER OR LIQUIDATOR OF ALL OR ANY SUBSTANTIAL PART OF THE
ASSETS OF THE COMPANY OR ANY OF ITS SUBSIDIARIES OR GRANTING RELIEF TO THE
COMPANY OR ANY OF ITS SUBSIDIARIES OR APPROVING THE PETITION IN ANY SUCH
PROCEEDING AND SUCH ORDER SHALL REMAIN IN EFFECT FOR MORE THAN 60 DAYS; OR

 

(Z)            THE COMPANY OR ANY OF ITS SUBSIDIARIES SHALL ADMIT IN WRITING ITS
INABILITY TO PAY ITS DEBTS AS THEY BECOME DUE OR FAIL GENERALLY TO PAY ITS DEBTS
AS THEY BECOME DUE OR SUFFER ANY WRIT OF ATTACHMENT OR EXECUTION OR ANY SIMILAR
PROCESS TO BE ISSUED OR LEVIED AGAINST IT OR ANY SUBSTANTIAL PART OF ITS
PROPERTY WHICH IS NOT RELEASED, STAYED, BONDED OR VACATED WITHIN THIRTY (30)
DAYS AFTER ITS ISSUE OR LEVY.

 

SECTION 7.2  REMEDIES CUMULATIVE.  NO REMEDY, RIGHT OR POWER CONFERRED UPON THE
AGENT OR ANY LENDER IS INTENDED TO BE EXCLUSIVE OF ANY OTHER REMEDY, RIGHT OR
POWER GIVEN HEREUNDER OR NOW OR HEREAFTER EXISTING AT LAW, IN EQUITY, OR
OTHERWISE, AND ALL SUCH REMEDIES, RIGHTS AND POWERS SHALL BE CUMULATIVE.

 

ARTICLE VIII — THE AGENT AND THE ISSUERS

 

SECTION 8.1  AUTHORIZATION AND ACTION.  (A)  EACH LENDER HEREBY IRREVOCABLY
APPOINTS AND AUTHORIZES THE AGENT TO TAKE SUCH ACTION AS AGENT ON ITS BEHALF AND
TO EXERCISE SUCH POWERS AND DISCRETION UNDER THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS AS ARE DELEGATED TO THE AGENT BY THE TERMS HEREOF AND THEREOF,
TOGETHER WITH SUCH POWERS AND DISCRETION AS ARE REASONABLY INCIDENTAL THERETO. 
EACH LENDER HEREBY IRREVOCABLY APPOINTS AND AUTHORIZES EACH ISSUER TO ACT AS ITS
AGENT UNDER THE LETTERS OF CREDIT WHICH SUCH ISSUER HAS ISSUED WITH SUCH POWERS
AS ARE SPECIFICALLY DELEGATED TO SUCH ISSUER BY THE TERMS HEREOF AND THEREOF,
TOGETHER WITH SUCH OTHER POWERS AS ARE REASONABLY INCIDENTAL THERETO. AS TO ANY
MATTERS NOT EXPRESSLY PROVIDED FOR BY THE LOAN DOCUMENTS (INCLUDING, WITHOUT
LIMITATION, ENFORCEMENT OR COLLECTION OF THE OBLIGATIONS OF THE COMPANY OR ANY
GUARANTOR), NEITHER AGENT NOR ANY ISSUER SHALL BE REQUIRED TO EXERCISE ANY
DISCRETION OR TAKE ANY ACTION, BUT SHALL BE REQUIRED TO ACT OR TO REFRAIN FROM
ACTING (AND SHALL BE FULLY PROTECTED IN SO ACTING OR REFRAINING FROM ACTING)
UPON THE INSTRUCTIONS OF THE REQUIRED LENDERS, AND SUCH INSTRUCTIONS SHALL BE
BINDING UPON ALL LENDERS, AND ALL HOLDERS OF NOTES, AND THE AGENT AGREES TO
REQUEST FROM THE COMPANY ANY INFORMATION THAT IS REASONABLY REQUESTED BY ANY
LENDER; PROVIDED, HOWEVER, THAT NEITHER THE AGENT NOR ANY ISSUER SHALL BE
REQUIRED TO TAKE ANY ACTION THAT EXPOSES THE AGENT TO PERSONAL LIABILITY OR THAT
IS CONTRARY TO THIS AGREEMENT OR APPLICABLE LAW.

 

(A)           THE AGENT, THE COLLATERAL AGENT AND/OR ANY ISSUER MAY EXECUTE ANY
OF ITS DUTIES UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT BY OR THROUGH
AGENTS, EMPLOYEES OR ATTORNEYS-IN-FACT AND SHALL BE ENTITLED TO ADVICE OF
COUNSEL AND OTHER CONSULTANTS OR EXPERTS CONCERNING ALL MATTERS PERTAINING TO
SUCH DUTIES.

 

(b)           Each of the Lenders hereby appoints and authorizes the Collateral
Agent to take such action as collateral agent on its behalf and to exercise such
powers under the Security Agreement A and Security Agreement B as are
specifically delegated to the Collateral Agent by the terms of such Loan
Documents, together with such other powers as are reasonably incidental thereto.

 

SECTION 8.2  AGENTS’, COLLATERAL AGENT’S AND ISSUERS’ RELIANCE, ETC.  NEITHER
THE AGENT NOR THE COLLATERAL AGENT NOR ANY ISSUER NOR ANY OF THEIR RESPECTIVE
DIRECTORS, OFFICERS, AGENTS OR EMPLOYEES SHALL BE LIABLE FOR ANY ACTION TAKEN OR
OMITTED TO BE TAKEN BY IT OR THEM UNDER OR IN CONNECTION WITH THE LOAN
DOCUMENTS, EXCEPT FOR ITS OR THEIR OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. 
WITHOUT LIMITATION OF THE GENERALITY OF THE FOREGOING, THE AGENT AND ANY ISSUER
EACH:  (A) MAY CONSULT WITH LEGAL COUNSEL (INCLUDING COUNSEL FOR ANY LOAN
PARTY), INDEPENDENT PUBLIC ACCOUNTANTS AND OTHER EXPERTS SELECTED BY IT AND
SHALL NOT BE LIABLE FOR ANY ACTION TAKEN OR OMITTED TO BE TAKEN IN GOOD FAITH BY
IT IN ACCORDANCE WITH

 

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THE ADVICE OF SUCH COUNSEL, ACCOUNTANTS OR EXPERTS; (B) MAKES NO WARRANTY OR
REPRESENTATION TO ANY LENDER AND SHALL NOT BE RESPONSIBLE TO ANY LENDER FOR ANY
STATEMENTS, WARRANTIES OR REPRESENTATIONS (WHETHER WRITTEN OR ORAL) MADE IN OR
IN CONNECTION WITH THE LOAN DOCUMENTS; (C) SHALL NOT HAVE ANY DUTY TO ASCERTAIN
OR TO INQUIRE AS TO THE PERFORMANCE, OBSERVANCE OR SATISFACTION OF ANY OF THE
TERMS, COVENANTS OR CONDITIONS OF ANY LOAN DOCUMENT ON THE PART OF ANY LOAN
PARTY OR THE EXISTENCE AT ANY TIME OF ANY DEFAULT UNDER THE LOAN DOCUMENTS OR TO
INSPECT THE PROPERTY (INCLUDING THE BOOKS AND RECORDS) OF ANY LOAN PARTY;
(D) SHALL NOT BE RESPONSIBLE TO ANY LENDER FOR THE DUE EXECUTION, LEGALITY,
VALIDITY, ENFORCEABILITY, GENUINENESS, SUFFICIENCY OR VALUE OF, OR THE
PERFECTION OR PRIORITY OF ANY LIEN OR SECURITY INTEREST CREATED OR PURPORTED TO
BE CREATED UNDER OR IN CONNECTION WITH, ANY LOAN DOCUMENT OR ANY OTHER
INSTRUMENT OR DOCUMENT FURNISHED PURSUANT THERETO; AND (E) SHALL INCUR NO
LIABILITY UNDER OR IN RESPECT OF ANY LOAN DOCUMENT BY ACTING UPON ANY NOTICE,
CONSENT, CERTIFICATE OR OTHER INSTRUMENT OR WRITING (WHICH MAY BE BY TELEGRAM,
TELECOPY OR ELECTRONIC COMMUNICATION) BELIEVED BY IT TO BE GENUINE AND SIGNED OR
SENT BY THE PROPER PARTY OR PARTIES.

 

SECTION 8.3  JPMORGAN AND AFFILIATES.  WITH RESPECT TO ITS COMMITMENTS AND ITS
LETTER OF CREDIT EXPOSURE, THE LOAN MADE BY IT AND ANY NOTE ISSUED TO IT,
JPMORGAN SHALL HAVE THE SAME RIGHTS AND POWERS UNDER THE LOAN DOCUMENTS AS ANY
OTHER LENDER AND MAY EXERCISE THE SAME AS THOUGH EACH WERE NOT AN AGENT OR AN
ISSUER; AND THE TERM “LENDER” OR “LENDERS” SHALL, UNLESS OTHERWISE EXPRESSLY
INDICATED, INCLUDE JPMORGAN IN ITS INDIVIDUAL CAPACITY.  JPMORGAN AND ITS
AFFILIATES MAY ACCEPT DEPOSITS FROM, LEND MONEY TO, ACT AS TRUSTEE UNDER
INDENTURES OF, ACCEPT INVESTMENT BANKING ENGAGEMENTS FROM, ACT AS A COUNTERPARTY
TO ANY HEDGING AGREEMENTS AND GENERALLY ENGAGE IN ANY KIND OF BUSINESS WITH, ANY
LOAN PARTY, ANY OF ITS SUBSIDIARIES AND ANY PERSON THAT MAY DO BUSINESS WITH OR
OWN SECURITIES OF ANY LOAN PARTY OR ANY SUCH SUBSIDIARY, ALL AS IF JPMORGAN WERE
NOT THE AGENT OR AN ISSUER AND WITHOUT ANY DUTY TO ACCOUNT THEREFOR TO THE
LENDERS.  NO AGENT OR ISSUER SHALL HAVE ANY DUTY TO DISCLOSE ANY INFORMATION
OBTAINED OR RECEIVED BY IT OR ANY OF ITS AFFILIATES RELATING TO ANY LOAN PARTY
OR ANY OF ITS SUBSIDIARIES TO THE EXTENT SUCH INFORMATION WAS OBTAINED OR
RECEIVED IN ANY CAPACITY OTHER THAN AS THE AGENT OR AN ISSUER, RESPECTIVELY.

 

SECTION 8.4  LENDER CREDIT DECISION.  EACH LENDER ACKNOWLEDGES THAT IT HAS,
INDEPENDENTLY AND WITHOUT RELIANCE UPON THE AGENT, ANY ISSUER OR ANY OTHER
LENDER AND BASED ON THE FINANCIAL STATEMENTS REFERRED TO IN SECTION 4.01 AND
SUCH OTHER DOCUMENTS AND INFORMATION AS IT HAS DEEMED APPROPRIATE, MADE ITS OWN
CREDIT ANALYSIS AND DECISION TO ENTER INTO THIS AGREEMENT.  EACH LENDER ALSO
ACKNOWLEDGES THAT IT WILL, INDEPENDENTLY AND WITHOUT RELIANCE UPON THE AGENT,
ANY ISSUER OR ANY OTHER LENDER AND BASED ON SUCH DOCUMENTS AND INFORMATION AS IT
SHALL DEEM APPROPRIATE AT THE TIME, CONTINUE TO MAKE ITS OWN CREDIT DECISIONS IN
TAKING OR NOT TAKING ACTION UNDER THIS AGREEMENT.

 

SECTION 8.5  INDEMNIFICATION.  (A)  EACH LENDER SEVERALLY AGREES TO INDEMNIFY
THE AGENT AND ANY ISSUER (TO THE EXTENT NOT PROMPTLY REIMBURSED BY THE COMPANY)
FROM AND AGAINST SUCH LENDER’S RATABLE SHARE (DETERMINED AS PROVIDED BELOW) OF
ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS,
JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS OF ANY KIND OR NATURE
WHATSOEVER THAT MAY BE IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST THE AGENT OR
ANY ISSUER IN ANY WAY RELATING TO OR ARISING OUT OF THE LOAN DOCUMENTS OR ANY
ACTION TAKEN OR OMITTED BY THE AGENT OR ANY ISSUER UNDER THE LOAN DOCUMENTS
(COLLECTIVELY, THE “INDEMNIFIED COSTS”); PROVIDED, HOWEVER, THAT NO LENDER SHALL
BE LIABLE FOR ANY PORTION OF SUCH LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES,
PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS RESULTING
FROM THE AGENT’S OR ANY ISSUER’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT AS FOUND
IN A FINAL, NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION. 
WITHOUT LIMITATION OF THE FOREGOING, EACH LENDER AGREES TO REIMBURSE THE AGENT
AND ANY ISSUER PROMPTLY UPON DEMAND FOR ITS RATABLE SHARE OF ANY COSTS AND
EXPENSES (INCLUDING, WITHOUT LIMITATION, FEES AND EXPENSES OF COUNSEL) PAYABLE
BY THE COMPANY UNDER SECTION 9.8, TO THE EXTENT THAT THE AGENT OR ANY ISSUER IS
NOT PROMPTLY REIMBURSED FOR SUCH COSTS AND EXPENSES BY THE COMPANY.  IN THE CASE
OF ANY INVESTIGATION,

 

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LITIGATION OR PROCEEDING GIVING RISE TO ANY INDEMNIFIED COSTS, THIS SECTION 8.5
APPLIES WHETHER ANY SUCH INVESTIGATION, LITIGATION OR PROCEEDING IS BROUGHT BY
ANY LENDER OR ANY OTHER PERSON.

 

For purposes of this Section 8.5, each Lender’s ratable share of any amount
shall be determined, at any time, according to the sum of (i) the aggregate
principal amount of the Loans and Letter of Credit Exposure outstanding at such
time and owing to such Lender and (ii) the aggregate Unused Commitments at such
time. The failure of any Lender to reimburse the Agent or any Issuer promptly
upon demand for its ratable share of any amount required to be paid by the
Lenders to the Agent or any Issuer as provided herein shall not relieve any
other Lender of its obligation hereunder to reimburse the Agent or any Issuer
for its ratable share of such amount, but no Lender shall be responsible for the
failure of any other Lender to reimburse the Agent or any Issuer for such other
Lender’s ratable share of such amount.  Without prejudice to the survival of any
other agreement of any Lender hereunder, the agreement and obligations of each
Lender contained in this Section 8.6 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the other
Loan Documents.

 

SECTION 8.6  SUCCESSOR AGENTS.  THE AGENT MAY RESIGN AT ANY TIME BY GIVING
WRITTEN NOTICE THEREOF TO THE LENDERS AND THE COMPANY.  UPON ANY SUCH
RESIGNATION, THE LENDERS (IN CONSULTATION WITH THE COMPANY) SHALL HAVE THE RIGHT
TO APPOINT A SUCCESSOR AGENT.  IF NO SUCCESSOR AGENT SHALL HAVE BEEN SO
APPOINTED BY THE LENDERS, AND SHALL HAVE ACCEPTED SUCH APPOINTMENT, WITHIN 30
DAYS AFTER THE RETIRING AGENT’S GIVING OF NOTICE OF RESIGNATION, THEN THE
RETIRING AGENT MAY, ON BEHALF OF THE LENDERS, APPOINT A SUCCESSOR AGENT, WHICH
SHALL BE A COMMERCIAL BANK ORGANIZED UNDER THE LAWS OF THE UNITED STATES OR OF
ANY STATE THEREOF AND HAVING A COMBINED CAPITAL AND SURPLUS OF AT LEAST
$250,000,000.  UPON THE ACCEPTANCE OF ANY APPOINTMENT AS AGENT HEREUNDER BY A
SUCCESSOR AGENT, SUCH SUCCESSOR AGENT SHALL SUCCEED TO AND BECOME VESTED WITH
ALL THE RIGHTS, POWERS, DISCRETION, PRIVILEGES AND DUTIES OF THE RETIRING AGENT,
AND THE RETIRING AGENT SHALL BE DISCHARGED FROM ITS DUTIES AND OBLIGATIONS UNDER
THE LOAN DOCUMENTS.  IF WITHIN 30 DAYS AFTER WRITTEN NOTICE IS GIVEN OF THE
RETIRING AGENT’S RESIGNATION UNDER THIS SECTION 8.6 NO SUCCESSOR AGENT SHALL
HAVE BEEN APPOINTED AND SHALL HAVE ACCEPTED SUCH APPOINTMENT, THEN ON SUCH
30TH DAY (A) THE RETIRING AGENT’S RESIGNATION OR REMOVAL SHALL BECOME EFFECTIVE,
(B) THE RETIRING AGENT SHALL THEREUPON BE DISCHARGED FROM ITS DUTIES AND
OBLIGATIONS UNDER THE LOAN DOCUMENTS AND (C) THE LENDERS SHALL THEREAFTER
PERFORM ALL DUTIES OF THE RETIRING AGENT UNDER THE LOAN DOCUMENTS UNTIL SUCH
TIME, IF ANY, AS THE LENDERS APPOINT A SUCCESSOR AGENT AS PROVIDED ABOVE.  AFTER
ANY RETIRING AGENT’S RESIGNATION OR REMOVAL HEREUNDER AS AGENT AS TO THE
FACILITY SHALL HAVE BECOME EFFECTIVE, THE PROVISIONS OF THIS ARTICLE VIII SHALL
INURE TO ITS BENEFIT AS TO ANY ACTIONS TAKEN OR OMITTED TO BE TAKEN BY IT WHILE
IT WAS AGENT UNDER THIS AGREEMENT.

 

SECTION 8.7  OTHER AGENTS; ARRANGERS AND MANAGERS.  NONE OF THE LENDERS OR OTHER
PERSONS IDENTIFIED ON THE FACING PAGE OR SIGNATURE PAGES OF THIS AGREEMENT AS A
“SYNDICATION AGENT,” “DOCUMENTATION AGENT,” “BOOKRUNNER,” OR “LEAD ARRANGER”
SHALL HAVE ANY RIGHT, POWER, OBLIGATION, LIABILITY, RESPONSIBILITY OR DUTY UNDER
THIS AGREEMENT OTHER THAN TO THE EXTENT EXPRESSLY SET FORTH HEREIN AND, IN THE
CASE OF SUCH LENDERS, THOSE APPLICABLE TO ALL LENDERS AS SUCH.  WITHOUT LIMITING
THE FOREGOING, NONE OF THE LENDERS OR OTHER PERSONS SO IDENTIFIED SHALL HAVE OR
BE DEEMED TO HAVE ANY FIDUCIARY RELATIONSHIP WITH ANY LENDER.  EACH LENDER
ACKNOWLEDGES THAT IT HAS NOT RELIED, AND WILL NOT RELY, ON ANY OF THE LENDERS OR
OTHER PERSONS SO IDENTIFIED IN DECIDING TO ENTER INTO THIS AGREEMENT OR IN
TAKING OR NOT TAKING ACTION HEREUNDER.

 

ARTICLE IX — MISCELLANEOUS

 

SECTION 9.1  NO WAIVER.  NO WAIVER OF ANY DEFAULT SHALL BE DEEMED TO BE A WAIVER
OF ANY OTHER DEFAULT.  NO FAILURE TO EXERCISE AND NO DELAY ON THE PART OF THE
AGENT OR ANY LENDER IN EXERCISING ANY RIGHT OR POWER UNDER ANY LOAN DOCUMENT OR
AT LAW OR IN EQUITY SHALL OPERATE AS A WAIVER THEREOF, NOR SHALL ANY SINGLE OR
PARTIAL EXERCISE OF ANY SUCH RIGHT OR POWER, OR THE ABANDONMENT OR
DISCONTINUANCE OF

 

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STEPS TO ENFORCE ANY SUCH RIGHT OR POWER, PRECLUDE ANY FURTHER OR OTHER EXERCISE
THEREOF OR THE EXERCISE OF ANY OTHER RIGHT OR POWER.  NO COURSE OF DEALING
BETWEEN THE COMPANY AND THE AGENT OR ANY LENDER SHALL OPERATE AS A WAIVER OF ANY
RIGHT OR POWER OF THE AGENT OR ANY LENDER.  NO AMENDMENT, MODIFICATION OR WAIVER
OF ANY PROVISION OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT NOR ANY CONSENT TO
ANY DEPARTURE THEREFROM SHALL BE EFFECTIVE UNLESS THE SAME IS IN WRITING AND
SIGNED BY THE PERSON AGAINST WHOM IT IS SOUGHT TO BE ENFORCED, AND THEN IT SHALL
BE EFFECTIVE ONLY IN THE SPECIFIC INSTANCE AND FOR THE PURPOSE FOR WHICH GIVEN. 
NO NOTICE TO OR DEMAND ON THE COMPANY OR ANY OTHER PERSON SHALL ENTITLE THE
COMPANY OR ANY OTHER PERSON TO ANY OTHER OR FURTHER NOTICE OR DEMAND IN SIMILAR
OR OTHER CIRCUMSTANCES.

 

SECTION 9.2  NOTICES.

 

(A)           ALL NOTICES AND OTHER COMMUNICATIONS PROVIDED FOR HEREUNDER SHALL
BE EITHER (X) IN WRITING (INCLUDING FACSIMILE OR ELECTRONIC COMMUNICATION) AND
MAILED, FAXED OR DELIVERED OR (Y) AS AND TO THE EXTENT SET FORTH IN
SECTION 9.2(B) AND IN THE PROVISO TO THIS SECTION 9.2(A), IN AN ELECTRONIC
MEDIUM AND DELIVERED AS SET FORTH IN SECTION 9.2(B), IF TO ANY LOAN PARTY, TO
THE COMPANY AT ITS ADDRESS AT 550 BOWIE STREET, AUSTIN, TEXAS 78703, ATTENTION: 
GLENDA CHAMBERLAIN AND CHIEF FINANCIAL OFFICER, FAXED TO: 512-482-7205, WITH
COPY TO THE GENERAL COUNSEL’S OFFICE AT THE SAME ADDRESS AND FAXED TO
512-482-7217; IF TO ANY INITIAL LENDER PARTY TO THIS AGREEMENT ON DATE HEREOF,
AT THE ADDRESS SPECIFIED FOR SUCH LENDER ON SCHEDULE 2.1(A) HERETO; IF TO ANY
OTHER LENDER, AT THE ADDRESS SPECIFIED IN THE ASSIGNMENT AND ACCEPTANCE PURSUANT
TO WHICH IT BECAME A LENDER; IF TO THE AGENT, AT ITS ADDRESS AT  221 W.
6TH STREET, 2ND FLOOR, AUSTIN, TEXAS 78701, MAIL CODE TX3-8229, ATTENTION: 
MANAGER, COMMERCIAL LENDING GROUP, FAX: 512-479-2814; OR, AS TO ANY PARTY, AT
SUCH OTHER ADDRESS AS SHALL BE DESIGNATED BY SUCH PARTY IN A WRITTEN NOTICE TO
THE OTHER PARTIES; PROVIDED, HOWEVER, THAT MATERIALS AND INFORMATION DESCRIBED
IN SECTION 9.2(B) SHALL BE DELIVERED TO THE AGENT IN ACCORDANCE WITH THE
PROVISIONS THEREOF OR AS OTHERWISE SPECIFIED TO THE COMPANY BY THE AGENT. 
EXCEPT AS OTHERWISE PROVIDED HEREIN, ALL NOTICES, CONSENTS, CERTIFICATES,
WAIVERS, DOCUMENTS AND OTHER COMMUNICATIONS REQUIRED OR PERMITTED TO BE
DELIVERED TO ANY PARTY UNDER THE TERMS OF ANY LOAN DOCUMENT (A) MUST BE IN
WRITING, (B) MUST BE PERSONALLY DELIVERED, TRANSMITTED BY A RECOGNIZED COURIER
SERVICE OR TRANSMITTED BY FACSIMILE, AND (C) MUST BE DIRECTED TO SUCH PARTY AT
ITS ADDRESS OR FACSIMILE NUMBER SET FORTH ABOVE OR ON SCHEDULE 2.1(A) HERETO. 
EXCEPT AS PROVIDED IN SUBSECTION (B) BELOW, ALL NOTICES WILL BE DEEMED TO HAVE
BEEN DULY GIVEN AND RECEIVED ON THE DATE OF DELIVERY IF DELIVERED PERSONALLY,
THREE (3) DAYS AFTER DELIVERY TO THE COURIER IF TRANSMITTED BY COURIER, OR THE
DATE OF TRANSMISSION DURING NORMAL BUSINESS HOURS WITH CONFIRMATION IF
TRANSMITTED BY FACSIMILE, WHICHEVER OCCURS FIRST, EXCEPT THAT NOTICES AND
COMMUNICATIONS TO THE AGENT OR THE COLLATERAL AGENT PURSUANT TO ARTICLE II, III
OR VII SHALL NOT BE EFFECTIVE UNTIL RECEIVED BY THE AGENT.  ANY PARTY MAY CHANGE
ITS ADDRESS OR FACSIMILE NUMBER FOR PURPOSES HEREOF BY NOTICE TO ALL OTHER
PARTIES.  DELIVERY BY TELECOPIER OF AN EXECUTED COUNTERPART OF A SIGNATURE
PAGE TO ANY AMENDMENT OR WAIVER OF ANY PROVISION OF THIS AGREEMENT OR THE NOTES
SHALL BE EFFECTIVE AS DELIVERY OF AN ORIGINAL EXECUTED COUNTERPART THEREOF.

 

(B)           THE COMPANY HEREBY AGREES THAT IT WILL PROVIDE TO THE AGENT ALL
INFORMATION, DOCUMENTS AND OTHER MATERIALS THAT IT IS OBLIGATED TO FURNISH TO
THE AGENT PURSUANT TO THE LOAN DOCUMENTS, INCLUDING, WITHOUT LIMITATION, ALL
NOTICES, REQUESTS, FINANCIAL STATEMENTS, FINANCIAL AND OTHER REPORTS,
CERTIFICATES AND OTHER INFORMATION MATERIALS, BUT EXCLUDING ANY SUCH
COMMUNICATION THAT (I) RELATES TO A REQUEST FOR A NEW, OR A CONVERSION OF AN
EXISTING, BORROWING (INCLUDING ANY ELECTION OF AN INTEREST RATE OR LIBOR
INTEREST PERIOD RELATING THERETO), (II) RELATES TO THE PAYMENT OF ANY PRINCIPAL
OR OTHER AMOUNT DUE UNDER THIS AGREEMENT PRIOR TO THE SCHEDULED DATE THEREFOR,
(III) PROVIDES NOTICE OF ANY DEFAULT OR EVENT OF DEFAULT UNDER THIS AGREEMENT OR
(IV) COMPRISES ORIGINAL EXECUTED COUNTERPARTS, ORIGINAL GOVERNMENTAL
CERTIFICATES , IN EACH CASE, REQUIRED TO BE DELIVERED TO SATISFY ANY CONDITION
PRECEDENT TO THE EFFECTIVENESS OF THIS AGREEMENT AND/OR ANY BORROWING THEREUNDER
(ALL SUCH NON-EXCLUDED COMMUNICATIONS BEING REFERRED TO HEREIN COLLECTIVELY AS
“COMMUNICATIONS”), BY TRANSMITTING THE COMMUNICATIONS IN AN ELECTRONIC/SOFT
MEDIUM IN A FORMAT REASONABLY ACCEPTABLE TO THE AGENT TO AN ELECTRONIC MAIL
ADDRESS SPECIFIED BY THE AGENT TO THE COMPANY.  IN ADDITION, THE COMPANY AGREES
TO CONTINUE TO PROVIDE THE

 

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COMMUNICATIONS TO THE AGENT IN THE MANNER SPECIFIED IN THE LOAN DOCUMENTS BUT
ONLY TO THE EXTENT REQUESTED BY THE AGENT.  THE COMPANY FURTHER AGREES THAT THE
AGENT MAY MAKE THE COMMUNICATIONS AVAILABLE TO THE LENDERS BY POSTING THE
COMMUNICATIONS ON INTRALINKS OR A SUBSTANTIALLY SIMILAR ELECTRONIC TRANSMISSION
SYSTEM (THE “PLATFORM”); PROVIDED THAT, UNLESS OTHERWISE INDICATED BY THE
COMPANY, ALL SUCH INFORMATION SO MADE AVAILABLE TO THE LENDER PARTIES SHALL BE
TREATED BY THE AGENT AS CONFIDENTIAL INFORMATION.

 

(C)           THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE”.  THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
COMMUNICATIONS, OR THE ADEQUACY OF THE PLATFORM AND EXPRESSLY DISCLAIM LIABILITY
FOR ERRORS OR OMISSIONS IN THE COMMUNICATIONS.  NO WARRANTY OF ANY KIND,
EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD
PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE AGENT
PARTIES IN CONNECTION WITH THE COMMUNICATIONS OR THE PLATFORM.  IN NO EVENT
SHALL THE AGENT OR ANY OF ITS AFFILIATES OR ANY OF THEIR RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES (COLLECTIVELY, “AGENT
PARTIES”) HAVE ANY LIABILITY TO THE COMPANY, ANY LENDER OR ANY OTHER PERSON OR
ENTITY FOR DAMAGES OF ANY KIND, INCLUDING, WITHOUT LIMITATION, DIRECT OR
INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES
(WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF THE COMPANY’S OR THE
AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET, EXCEPT TO THE
EXTENT THE LIABILITY OF THE AGENT OR THE COLLATERAL AGENT PARTY IS FOUND IN A
FINAL NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO HAVE
RESULTED PRIMARILY FROM SUCH AGENT PARTY’S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT.

 

(D)           THE AGENT AGREES THAT THE RECEIPT OF THE COMMUNICATIONS BY THE
AGENT AT ITS E-MAIL ADDRESS SET FORTH ABOVE SHALL CONSTITUTE EFFECTIVE DELIVERY
OF THE COMMUNICATIONS TO THE AGENT FOR PURPOSES OF THE LOAN DOCUMENTS.  EACH
LENDER AGREES THAT NOTICE TO IT (AS PROVIDED IN THE NEXT SENTENCE) SPECIFYING
THAT THE COMMUNICATIONS HAVE BEEN POSTED TO THE PLATFORM SHALL CONSTITUTE
EFFECTIVE DELIVERY OF THE COMMUNICATIONS TO SUCH LENDER FOR PURPOSES OF THE LOAN
DOCUMENTS.  EACH LENDER AGREES TO NOTIFY THE AGENT IN WRITING (INCLUDING BY
ELECTRONIC COMMUNICATION) FROM TIME TO TIME OF SUCH LENDER’S E-MAIL ADDRESS TO
WHICH THE FOREGOING NOTICE MAY BE SENT BY ELECTRONIC TRANSMISSION AND (II) THAT
THE FOREGOING NOTICE MAY BE SENT TO SUCH E-MAIL ADDRESS.  NOTHING HEREIN SHALL
PREJUDICE THE RIGHT OF THE AGENT OR ANY LENDER TO GIVE ANY NOTICE OR OTHER
COMMUNICATION PURSUANT TO ANY LOAN DOCUMENT IN ANY OTHER MANNER SPECIFIED IN
SUCH LOAN DOCUMENT.

 

SECTION 9.3  JURISDICTION; GOVERNING LAW; ETC.

 

(A)           EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF ANY
NEW YORK STATE COURT OR FEDERAL COURT OF THE UNITED STATES OF AMERICA SITTING IN
NEW YORK CITY, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY, 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 ANY SUCH NEW YORK STATE COURT OR, TO THE FULLEST 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

 

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ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS AGREEMENT SHALL AFFECT ANY
RIGHT THAT ANY PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS IN THE COURTS OF
ANY JURISDICTION.

 

(B)           EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES,
TO THE FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION THAT
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 OF THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY IN ANY NEW YORK STATE OR FEDERAL COURT.  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.

 

(C)           THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

 

(D)           EACH OF THE COMPANY, THE AGENT AND THE LENDERS IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER
BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE
LOAN DOCUMENTS, THE LOANS OR THE ACTIONS OF THE AGENT OR ANY LENDER IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

 

SECTION 9.4  SURVIVAL; PARTIES BOUND.  ALL REPRESENTATIONS, WARRANTIES,
COVENANTS AND AGREEMENTS MADE BY OR ON BEHALF OF THE COMPANY IN CONNECTION
HEREWITH SHALL SURVIVE THE EXECUTION AND DELIVERY OF THE LOAN DOCUMENTS, SHALL
NOT BE AFFECTED BY ANY INVESTIGATION MADE BY ANY PERSON, AND SHALL BIND THE
COMPANY AND ITS SUCCESSORS, TRUSTEES, RECEIVERS AND ASSIGNS AND INURE TO THE
BENEFIT OF THE SUCCESSORS AND ASSIGNS OF THE AGENT AND THE LENDERS, PROVIDED
THAT THE UNDERTAKING OF THE LENDERS HEREUNDER TO MAKE LOANS TO THE COMPANY AND
TO ISSUE LETTERS OF CREDIT FOR THE ACCOUNT OF THE COMPANY SHALL NOT INURE TO THE
BENEFIT OF ANY SUCCESSOR OR ASSIGN OF THE COMPANY.  THE TERM OF THIS AGREEMENT
SHALL BE UNTIL THE FINAL MATURITY OF EACH NOTE AND THE PAYMENT OF ALL AMOUNTS
DUE UNDER THE LOAN DOCUMENTS.

 

SECTION 9.5  COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN ANY NUMBER OF
COUNTERPARTS AND BY DIFFERENT PARTIES HERETO IN SEPARATE COUNTERPARTS, EACH OF
WHICH WHEN SO EXECUTED SHALL BE DEEMED TO BE AN ORIGINAL AND ALL OF WHICH TAKEN
TOGETHER SHALL CONSTITUTE ONE AND THE SAME AGREEMENT.  DELIVERY OF AN EXECUTED
SIGNATURE PAGE OF THIS AGREEMENT BY FACSIMILE TRANSMISSION OR ELECTRONIC
TRANSMISSION (I.E., A “PDF” OR “TIF”) SHALL BE EFFECTIVE AS DELIVERY OF AN
ORIGINAL EXECUTED COUNTERPART OF THIS AGREEMENT.

 

SECTION 9.6  SURVIVAL.  THE OBLIGATIONS OF THE COMPANY UNDER SECTIONS 2.5(E),
2.10(B), 2.10(D), 2.15(D), 9.8, 9.9, 9.16 AND 9.17 HEREOF SHALL SURVIVE THE
REPAYMENT OF THE LOANS AND THE TERMINATION OF THE COMMITMENTS AND THE LETTERS OF
CREDIT.

 

SECTION 9.7  CAPTIONS.  THE HEADINGS AND CAPTIONS APPEARING IN THE LOAN
DOCUMENTS HAVE BEEN INCLUDED SOLELY FOR CONVENIENCE AND SHALL NOT BE CONSIDERED
IN CONSTRUING THE LOAN DOCUMENTS.

 

SECTION 9.8  EXPENSES, ETC.  WHETHER OR NOT ANY LOAN IS EVER MADE OR ANY LETTER
OF CREDIT EVER ISSUED, THE COMPANY SHALL PAY OR REIMBURSE ON DEMAND EACH OF THE
LENDERS AND THE AGENT FOR PAYING:  (A) THE REASONABLE FEES AND EXPENSES OF LOCKE
LIDDELL & SAPP LLP, COUNSEL TO THE AGENT OR ANY

 

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OTHER LEGAL COUNSEL ENGAGED BY THE AGENT, IN CONNECTION WITH (I) THE
PREPARATION, EXECUTION AND DELIVERY OF THIS AGREEMENT (INCLUDING THE EXHIBITS
AND SCHEDULES HERETO) AND THE LOAN DOCUMENTS AND THE MAKING OF THE LOANS AND THE
ISSUANCE OF LETTERS OF CREDIT HEREUNDER AND (II) ANY MODIFICATION, SUPPLEMENT OR
WAIVER OF ANY OF THE TERMS OF THIS AGREEMENT, ANY OF THE LETTERS OF CREDIT OR
ANY OTHER LOAN DOCUMENT MADE AS A RESULT OF ANY REQUEST BY THE COMPANY; (B) ALL
REASONABLE COSTS AND EXPENSES (INCLUDING REASONABLE ATTORNEYS’ FEES) OF THE
LENDERS AND THE AGENT IN CONNECTION WITH THE ENFORCEMENT OF THIS AGREEMENT, THE
LETTERS OF CREDIT OR ANY OTHER LOAN DOCUMENT; (C) ALL TRANSFER, STAMP,
DOCUMENTARY OR OTHER SIMILAR TAXES, ASSESSMENTS OR CHARGES LEVIED BY ANY
GOVERNMENTAL OR REVENUE AUTHORITY AFTER THE EFFECTIVE DATE HEREOF IN RESPECT OF
THIS AGREEMENT, ANY LETTER OF CREDIT OR ANY OTHER LOAN DOCUMENT OR ANY OTHER
DOCUMENT REFERRED TO HEREIN OR THEREIN; (D) ALL COSTS, EXPENSES, TAXES,
ASSESSMENTS AND OTHER CHARGES INCURRED AFTER THE EFFECTIVE DATE HEREOF IN
CONNECTION WITH ANY FILING, REGISTRATION, RECORDING OR PERFECTION OF ANY
SECURITY INTEREST CONTEMPLATED BY SECTION 5.10 OF THIS AGREEMENT; AND
(E) EXPENSES OF MUTUALLY AGREED DUE DILIGENCE AND SYNDICATION.

 

SECTION 9.9  INDEMNIFICATION.  THE COMPANY SHALL INDEMNIFY THE AGENT, THE
LENDERS, EACH ISSUER AND EACH AFFILIATE THEREOF AND THEIR RESPECTIVE DIRECTORS,
OFFICERS, EMPLOYEES, COUNSEL AND AGENTS FROM, AND HOLD EACH OF THEM HARMLESS
AGAINST, ANY AND ALL LOSSES, LIABILITIES (INCLUDING ENVIRONMENTAL LIABILITIES),
CLAIMS (INCLUDING ENVIRONMENTAL CLAIMS) OR DAMAGES TO WHICH ANY OF THEM MAY
BECOME SUBJECT, INSOFAR AS SUCH LOSSES, LIABILITIES, CLAIMS OR DAMAGES ARISE OUT
OF OR RESULT FROM ANY (A) ACTUAL OR PROPOSED USE BY THE COMPANY OF THE PROCEEDS
OF ANY EXTENSION OF CREDIT (WHETHER A LOAN OR A LETTER OF CREDIT) BY ANY LENDER
OR ANY ISSUER HEREUNDER, (B) BREACH BY THE COMPANY OF THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT, (C) VIOLATION BY THE COMPANY OR ANY OF ITS SUBSIDIARIES OF
ANY LAW, RULE, REGULATION OR ORDER INCLUDING ANY REQUIREMENTS OF ENVIRONMENTAL
LAW, (D) LIENS OR SECURITY INTERESTS GRANTED ON ANY PROPERTY PURSUANT TO OR
UNDER THE LOAN DOCUMENTS, TO THE EXTENT RESULTING FROM ANY HAZARDOUS SUBSTANCE,
PETROLEUM, PETROLEUM PRODUCT OR PETROLEUM WASTE LOCATED IN, ON OR UNDER ANY SUCH
PROPERTY, (E) OWNERSHIP BY THE LENDERS OR THE AGENT OF ANY PROPERTY FOLLOWING
FORECLOSURE UNDER THE LOAN DOCUMENTS, TO THE EXTENT SUCH LOSSES, LIABILITIES,
CLAIMS OR DAMAGES ARISE OUT OF OR RESULT FROM ANY HAZARDOUS SUBSTANCE,
PETROLEUM, PETROLEUM PRODUCT OR PETROLEUM WASTE LOCATED IN, ON OR UNDER SUCH
PROPERTY, INCLUDING LOSSES, LIABILITIES, CLAIMS OR DAMAGES WHICH ARE IMPOSED
UPON PERSONS UNDER LAWS RELATING TO OR REGULATING HAZARDOUS SUBSTANCES,
PETROLEUM, PETROLEUM PRODUCTS OR PETROLEUM WASTES SOLELY BY VIRTUE OF OWNERSHIP,
(F) ANY LENDER OR THE AGENT BEING DEEMED AN OPERATOR OF ANY SUCH PROPERTY BY A
COURT OR OTHER REGULATORY OR ADMINISTRATIVE AGENCY OR TRIBUNAL OR OTHER THIRD
PARTY, TO THE EXTENT SUCH LOSSES, LIABILITIES, CLAIMS OR DAMAGES ARISE OUT OF OR
RESULT FROM ANY HAZARDOUS SUBSTANCE, PETROLEUM, PETROLEUM PRODUCT OR PETROLEUM
WASTE LOCATED IN ON OR UNDER SUCH PROPERTY, (G) THE MAKING OF THE EXTENSIONS OF
CREDIT HEREUNDER AND THE CONSUMMATION OF ANY OF THE TRANSACTIONS CONTEMPLATED IN
THE LOAN DOCUMENTS OR (H) INVESTIGATION, LITIGATION OR OTHER PROCEEDING
(INCLUDING ANY THREATENED INVESTIGATION OR PROCEEDING) RELATING TO ANY OF THE
FOREGOING, AND THE COMPANY SHALL REIMBURSE THE AGENT AND EACH LENDER, AND EACH
AFFILIATE THEREOF AND THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, COUNSEL
AND AGENTS, UPON DEMAND FOR ANY EXPENSES (INCLUDING LEGAL FEES) INCURRED IN
CONNECTION WITH ANY SUCH INVESTIGATION OR PROCEEDING, AND WHETHER ANY SUCH LOSS,
LIABILITY, CLAIM OR DAMAGE RESULTS FROM THE NEGLIGENCE OF ANY SUCH INDEMNIFIED
PERSON; BUT EXCLUDING ANY SUCH LOSSES, LIABILITIES, CLAIMS, DAMAGES OR EXPENSES
INCURRED BY A PERSON OR ANY AFFILIATE THEREOF OR THEIR RESPECTIVE DIRECTORS,
OFFICERS, EMPLOYEES, COUNSEL OR AGENTS BY REASON OF THE GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF SUCH PERSON, AFFILIATE, DIRECTOR, OFFICER, EMPLOYEE OR
AGENT.  PROMPTLY AFTER RECEIPT BY AN INDEMNIFIED PERSON OF NOTICE OF ANY CLAIM
OR THE COMMENCEMENT OF ANY ACTION, SUCH INDEMNIFIED PERSON SHALL, IF ANY CLAIM
IN RESPECT THEREOF IS TO BE MADE AGAINST THE COMPANY UNDER THIS SECTION 9.10,
NOTIFY THE COMPANY IN WRITING OF THE CLAIM OR THE COMMENCEMENT OF THAT ACTION. 
THE COMPANY SHALL NOT BE LIABLE FOR ANY SETTLEMENT OF ANY SUCH CLAIM OR ACTION
INVOLVING THE PAYMENT OF MONETARY DAMAGES EFFECTED WITHOUT ITS WRITTEN CONSENT
NOT TO BE UNREASONABLY WITHHELD.  IF ANY SUCH CLAIM OR ACTION SHALL BE BROUGHT
AGAINST AN INDEMNIFIED PERSON AND IT SHALL NOTIFY THE COMPANY THEREOF, THE
COMPANY SHALL BE ENTITLED TO PARTICIPATE IN THE JOINT DEFENSE THEREOF.

 

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SECTION 9.10  AMENDMENTS, ETC.  NO AMENDMENT OR WAIVER OF ANY PROVISION OF THIS
AGREEMENT, THE NOTES OR ANY OTHER LOAN DOCUMENT (EXCEPT FOR THE CREDIT FACILITY
HEDGING AGREEMENTS), NOR ANY CONSENT TO ANY DEPARTURE BY THE COMPANY THEREFROM,
SHALL IN ANY EVENT BE EFFECTIVE UNLESS THE SAME SHALL BE AGREED OR CONSENTED TO
BY THE REQUIRED LENDERS AND THE COMPANY, AND EACH SUCH WAIVER OR CONSENT SHALL
BE EFFECTIVE ONLY IN THE SPECIFIC INSTANCE AND FOR THE SPECIFIC PURPOSE FOR
WHICH GIVEN; PROVIDED, THAT NO AMENDMENT, WAIVER OR CONSENT SHALL, UNLESS IN
WRITING AND SIGNED BY EACH LENDER, DO ANY OF THE FOLLOWING:  (A) INCREASE ANY
COMMITMENT OF ANY OF THE LENDERS OR SUBJECT THE AGENT OR ANY OF THE LENDERS TO
ANY ADDITIONAL OBLIGATIONS, OTHER THAN AS INCREASED PURSUANT TO THE TERMS OF
SECTION 2.16; (B) REDUCE THE PRINCIPAL OF, OR INTEREST ON, ANY LOAN, ANY LETTER
OF CREDIT EXPOSURE AMOUNT OR ANY FEE HEREUNDER; (C) WAIVE OR POSTPONE ANY
SCHEDULED DATE FIXED FOR ANY PAYMENT OF PRINCIPAL OF, OR INTEREST ON, ANY LOAN,
ANY LETTER OF CREDIT EXPOSURE AMOUNT OR ANY FEE OR OTHER SUM TO BE PAID
HEREUNDER; (D) CHANGE THE PERCENTAGE OF ANY OF THE COMMITMENTS OR OF THE
AGGREGATE UNPAID PRINCIPAL AMOUNT OF ANY OF THE LOANS, ANY LETTER OF CREDIT
EXPOSURE AMOUNT, OR THE NUMBER OF LENDERS, WHICH SHALL BE REQUIRED FOR THE
LENDERS OR ANY OF THEM TO TAKE ANY ACTION UNDER THIS AGREEMENT; (E) CHANGE ANY
PROVISION CONTAINED IN SECTIONS 2.4, 2.7, 9.8 OR 9.9 HEREOF OR THIS SECTION 9.10
OR SECTIONS 9.15 OR 9.18 HEREOF; (F) RELEASE ALL OR ANY SUBSTANTIAL PART OF THE
SECURITY FOR THE OBLIGATIONS OF THE COMPANY UNDER THIS AGREEMENT, ANY
APPLICATION OR ANY NOTE; (G) RELEASE ANY GUARANTOR FROM ANY GUARANTY (EXCEPT FOR
GUARANTORS SOLD BY THE COMPANY OR ANY OF ITS SUBSIDIARIES PURSUANT TO THE TERMS
OF SECTION 6.4(Y) HEREOF); (H) CHANGE THE DEFINITION OF “REQUIRED LENDERS”
CONTAINED HEREIN (I) MODIFY THE REQUIREMENT OF UNANIMOUS WRITTEN APPROVAL BY THE
LENDERS OF ANY UNILATERAL REDUCTION BY THE LENDERS OF THE AGGREGATE COMMITMENT
AS PROVIDED FOR IN SECTION 2.2; OR (J) WAIVE OR POSTPONE ANY PREPAYMENT REQUIRED
BY SECTION 2.3 HEREOF.  ANYTHING IN THIS SECTION 9.10 TO THE CONTRARY, NO
AMENDMENT, WAIVER OR CONSENT SHALL BE MADE WITH RESPECT TO SECTION 8 WITHOUT THE
CONSENT OF THE AGENT, AND ANYTHING IN THIS SECTION 9.10 TO THE CONTRARY, NO
AMENDMENT, WAIVER OR CONSENT SHALL BE MADE WITH RESPECT TO ANY PROVISIONS
REGARDING THE RIGHTS AND OBLIGATIONS OF AN ISSUER HEREUNDER WITHOUT THE CONSENT
OF THE APPLICABLE ISSUER(S).

 

SECTION 9.11  SUCCESSORS AND ASSIGNS.

 

(A)           THIS AGREEMENT SHALL BE BINDING UPON AND INURE TO THE BENEFIT OF
THE COMPANY, THE AGENT, THE ISSUERS AND THE LENDERS AND THEIR RESPECTIVE
SUCCESSORS AND ASSIGNS.  THE COMPANY MAY NOT ASSIGN OR TRANSFER ANY OF ITS
RIGHTS OR OBLIGATIONS HEREUNDER WITHOUT THE PRIOR WRITTEN CONSENT OF ALL OF THE
LENDERS.

 

(B)           EACH LENDER MAY SELL PARTICIPATIONS TO ANY PERSON IN ALL OR PART
OF ANY LOAN, OR ALL OR PART OF ITS NOTES, THE LETTER OF CREDIT EXPOSURE AMOUNT
OR COMMITMENTS, TO ANOTHER BANK OR OTHER ENTITY, IN WHICH EVENT, WITHOUT
LIMITING THE FOREGOING, THE PROVISIONS OF SECTIONS 2.12, 9.09, 9.15 AND 9.16
SHALL INURE TO THE BENEFIT OF EACH PURCHASER OF A PARTICIPATION AND THE PRO RATA
TREATMENT OF PAYMENTS, AS DESCRIBED IN SECTION 2.9, SHALL BE DETERMINED AS IF
SUCH LENDER HAD NOT SOLD SUCH PARTICIPATION.  IN THE EVENT ANY LENDER SHALL SELL
ANY PARTICIPATION, (I) THE COMPANY, THE AGENT AND THE OTHER LENDERS SHALL
CONTINUE TO DEAL SOLELY AND DIRECTLY WITH SUCH SELLING LENDER IN CONNECTION WITH
SUCH SELLING LENDER’S RIGHTS AND OBLIGATIONS UNDER THE LOAN DOCUMENTS (INCLUDING
THE NOTE HELD BY SUCH SELLING LENDER), (II) SUCH LENDER SHALL RETAIN THE SOLE
RIGHT AND RESPONSIBILITY TO ENFORCE THE OBLIGATIONS OF THE COMPANY RELATING TO
THE LOANS AND LETTER OF CREDIT EXPOSURE AMOUNT, INCLUDING THE RIGHT TO APPROVE
ANY AMENDMENT, MODIFICATION OR WAIVER OF ANY PROVISION OF THIS AGREEMENT OTHER
THAN (AND THEN ONLY IF EXPRESSLY PERMITTED BY THE APPLICABLE PARTICIPATION
AGREEMENT) AMENDMENTS, MODIFICATIONS OR WAIVERS WITH RESPECT TO (A) ANY FEES
PAYABLE HEREUNDER TO THE LENDERS AND (B) THE AMOUNT OF PRINCIPAL OR THE RATE OF
INTEREST PAYABLE ON, OR THE DATES FIXED FOR THE SCHEDULED REPAYMENT OF PRINCIPAL
OF, THE LOANS AND OTHER SUMS TO BE PAID TO THE LENDERS HEREUNDER, AND (III) THE
COMPANY AGREES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE
LAW, THAT ANY PARTICIPANT OF A LENDER MAY EXERCISE ALL RIGHTS OF SET-OFF,
BANKERS’ LIEN, COUNTERCLAIM OR SIMILAR RIGHTS WITH RESPECT TO SUCH PARTICIPATION
AS FULLY AS IF SUCH

 

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PARTICIPANT WERE A DIRECT HOLDER OF LOANS IF SUCH LENDER HAS PREVIOUSLY GIVEN
NOTICE OF SUCH PARTICIPATION TO THE COMPANY AND SUCH PARTICIPANT AGREES TO BE
BOUND BY SECTION 2.12 AS IF IT WERE A LENDER.

 

(C)           EACH LENDER MAY ASSIGN TO ONE OR MORE LENDERS OR ELIGIBLE
ASSIGNEES ALL OR A PORTION OF ITS INTERESTS, RIGHTS AND OBLIGATIONS UNDER THIS
AGREEMENT (INCLUDING ALL OR A PORTION OF ITS COMMITMENT AND THE SAME PORTION OF
THE RELATED LOAN AT THE TIME OWING TO IT AND ITS LETTER OF CREDIT EXPOSURE
AMOUNT) (A “RATABLE ASSIGNMENT”); PROVIDED, HOWEVER, THAT, (I) THE AGGREGATE
AMOUNT OF THE COMMITMENT, LOAN AND LETTER OF CREDIT EXPOSURE AMOUNT (WITHOUT
DUPLICATION) OF THE ASSIGNING LENDER SUBJECT TO EACH SUCH ASSIGNMENT (DETERMINED
AS OF THE DATE THE ASSIGNMENT AND ACCEPTANCE (AS DEFINED BELOW) WITH RESPECT TO
SUCH ASSIGNMENT IS DELIVERED TO THE AGENT) SHALL IN NO EVENT BE LESS THAN
$5,000,000 (UNLESS ALL OF THE ASSIGNING LENDER’S COMMITMENT, LOAN AND LETTER OF
CREDIT EXPOSURE AMOUNT IS BEING ASSIGNED); AND (II) THE PARTIES TO EACH SUCH
ASSIGNMENT SHALL EXECUTE AND DELIVER TO THE AGENT, FOR ITS ACCEPTANCE AND
RECORDING IN ITS RECORDS, AN ASSIGNMENT AND ACCEPTANCE IN THE FORM OF EXHIBIT F
ATTACHED HERETO (EACH AN “ASSIGNMENT AND ACCEPTANCE”) WITH BLANKS APPROPRIATELY
COMPLETED, TOGETHER WITH ANY NOTE OR NOTES SUBJECT TO SUCH ASSIGNMENT AND A
PROCESSING AND RECORDATION FEE OF $3,500 (FOR WHICH THE COMPANY SHALL HAVE NO
LIABILITY, AND PROVIDED THAT ONLY ONE SUCH FEE SHALL BE REQUIRED IN THE CASE OF
SIMULTANEOUS ASSIGNMENTS TO RELATED ENTITIES).  UPON SUCH EXECUTION, DELIVERY,
ACCEPTANCE AND RECORDING, FROM AND AFTER THE EFFECTIVE DATE SPECIFIED IN EACH
ASSIGNMENT AND ACCEPTANCE, WHICH EFFECTIVE DATE SHALL BE AT LEAST FIVE BUSINESS
DAYS AFTER THE EXECUTION THEREOF, UNLESS A SHORTER PERIOD OF TIME MAY BE AGREED
TO BY THE AGENT IN ITS SOLE AND ABSOLUTE DISCRETION, (A) THE ASSIGNEE THEREUNDER
SHALL BE A PARTY HERETO AND, TO THE EXTENT PROVIDED IN SUCH ASSIGNMENT AND
ACCEPTANCE, HAVE THE RIGHTS AND OBLIGATIONS OF A LENDER HEREUNDER AND (B) THE
LENDER THEREUNDER SHALL, TO THE EXTENT PROVIDED IN SUCH ASSIGNMENT, BE RELEASED
FROM ITS OBLIGATIONS UNDER THIS AGREEMENT (AND, IN THE CASE OF AN ASSIGNMENT AND
ACCEPTANCE COVERING ALL OR THE REMAINING PORTION OF AN ASSIGNING LENDER’S RIGHTS
AND OBLIGATIONS UNDER THIS AGREEMENT, SUCH LENDER SHALL CEASE TO BE A PARTY
HERETO).

 

(D)           BY EXECUTING AND DELIVERING AN ASSIGNMENT AND ACCEPTANCE, THE
LENDER ASSIGNOR THEREUNDER AND THE ASSIGNEE THEREUNDER CONFIRM TO AND AGREE WITH
EACH OTHER AND THE OTHER PARTIES HERETO AS FOLLOWS:  (I) OTHER THAN THE
REPRESENTATION AND WARRANTY THAT IT IS THE LEGAL AND BENEFICIAL OWNER OF THE
INTEREST BEING ASSIGNED THEREBY FREE AND CLEAR OF ANY ADVERSE CLAIM, SUCH LENDER
ASSIGNOR MAKES NO REPRESENTATION OR WARRANTY AND ASSUMES NO RESPONSIBILITY WITH
RESPECT TO ANY STATEMENTS, WARRANTIES OR REPRESENTATIONS MADE IN OR IN
CONNECTION WITH ANY LOAN DOCUMENT OR THE EXECUTION, LEGALITY, VALIDITY,
ENFORCEABILITY, GENUINENESS, SUFFICIENCY OR VALUE OF ANY LOAN DOCUMENT OR ANY
OTHER INSTRUMENT OR DOCUMENT FURNISHED PURSUANT THERETO; (II) SUCH ASSIGNOR
LENDER MAKES NO REPRESENTATION OR WARRANTY AND ASSUMES NO RESPONSIBILITY WITH
RESPECT TO THE FINANCIAL CONDITION OF THE COMPANY OR ANY OF ITS SUBSIDIARIES OR
THE PERFORMANCE OR OBSERVANCE BY THE COMPANY OF ANY OF ITS OBLIGATIONS
HEREUNDER; (III) SUCH ASSIGNEE CONFIRMS THAT IT HAS RECEIVED A COPY OF THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS, TOGETHER WITH COPIES OF THE FINANCIAL
STATEMENTS OF THE COMPANY PREVIOUSLY DELIVERED IN ACCORDANCE HEREWITH AND SUCH
OTHER DOCUMENTS AND INFORMATION AS IT HAS DEEMED APPROPRIATE TO MAKE ITS OWN
CREDIT ANALYSIS AND DECISION TO ENTER INTO SUCH ASSIGNMENT AND ACCEPTANCE;
(IV) SUCH ASSIGNEE WILL, INDEPENDENTLY AND WITHOUT RELIANCE UPON THE AGENT, SUCH
ASSIGNOR LENDER OR ANY OTHER LENDER AND BASED ON SUCH DOCUMENTS AND INFORMATION
AS IT SHALL DEEM APPROPRIATE AT THE TIME, CONTINUE TO MAKE ITS OWN CREDIT
DECISIONS IN TAKING OR NOT TAKING ACTION UNDER THE LOAN DOCUMENTS; (V) SUCH
ASSIGNEE APPOINTS AND AUTHORIZES THE AGENT TO TAKE SUCH ACTION AS AGENT ON ITS
BEHALF AND TO EXERCISE SUCH POWERS UNDER THE LOAN DOCUMENTS AS ARE DELEGATED TO
THE AGENT BY THE TERMS HEREOF, TOGETHER WITH SUCH POWERS AS ARE REASONABLY
INCIDENTAL THERETO; AND (VI) SUCH ASSIGNEE AGREES THAT IT WILL PERFORM IN
ACCORDANCE WITH THEIR TERMS ALL OBLIGATIONS THAT BY THE TERMS OF THE LOAN
DOCUMENTS ARE REQUIRED TO BE PERFORMED BY IT AS A LENDER.

 

(E)           THE AGENT SHALL MAINTAIN AT ITS OFFICE A COPY OF EACH ASSIGNMENT
AND ACCEPTANCE DELIVERED TO IT AND A RECORD OF THE NAMES AND ADDRESSES OF THE
LENDERS AND THE COMMITMENTS OF, AND PRINCIPAL AMOUNT OF THE LOANS OWING TO, AND
THE LETTER OF CREDIT EXPOSURE AMOUNT OF, EACH LENDER FROM

 

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TIME TO TIME (THE “REGISTER”).  THE ENTRIES IN THE REGISTER SHALL BE CONCLUSIVE,
IN THE ABSENCE OF MANIFEST ERROR, AND THE COMPANY, THE AGENT AND THE LENDERS MAY
TREAT EACH PERSON THE NAME OF WHICH IS RECORDED THEREIN AS A LENDER HEREUNDER
FOR ALL PURPOSES OF THE LOAN DOCUMENTS.  SUCH RECORDS SHALL BE AVAILABLE FOR
INSPECTION BY THE COMPANY OR ANY LENDER AT ANY REASONABLE TIME AND FROM TIME TO
TIME UPON REASONABLE PRIOR NOTICE.

 

(F)            UPON ITS RECEIPT OF AN ASSIGNMENT AND ACCEPTANCE EXECUTED BY AN
ASSIGNING LENDER AND THE ASSIGNEE THEREUNDER TOGETHER WITH THE NOTE, IF ANY,
SUBJECT TO SUCH ASSIGNMENT, THE WRITTEN CONSENT TO SUCH ASSIGNMENT AND THE FEE
PAYABLE IN RESPECT THERETO, THE AGENT SHALL, IF SUCH ASSIGNMENT AND ACCEPTANCE
HAS BEEN COMPLETED WITH BLANKS APPROPRIATELY FILLED, (I) ACCEPT SUCH ASSIGNMENT
AND ACCEPTANCE, (II) RECORD THE INFORMATION CONTAINED THEREIN IN THE REGISTER
AND (III) GIVE PROMPT NOTICE THEREOF TO THE COMPANY AND THE LENDERS. 
CONTEMPORANEOUSLY WITH THE RECEIPT BY THE COMPANY OF SUCH ASSIGNMENT AND
ACCEPTANCE, THE COMPANY, AT ITS OWN EXPENSE, SHALL EXECUTE AND DELIVER TO THE
AGENT IN EXCHANGE FOR THE SURRENDERED NOTE A NEW NOTE PAYABLE TO THE ORDER OF
SUCH ASSIGNEE IN AN AMOUNT EQUAL TO THE COMMITMENT, LOAN AND LETTER OF CREDIT
EXPOSURE AMOUNT (WITHOUT DUPLICATION) ASSUMED BY IT PURSUANT TO SUCH ASSIGNMENT
AND ACCEPTANCE AND, IF THE ASSIGNING LENDER HAS RETAINED A COMMITMENT, LOAN
AND/OR LETTER OF CREDIT EXPOSURE HEREUNDER, A NEW NOTE TO THE ORDER OF THE
ASSIGNING LENDER IN AN AMOUNT EQUAL TO THE COMMITMENT, LOAN AND/OR LETTER OF
CREDIT EXPOSURE RETAINED BY IT HEREUNDER.  SUCH NEW NOTES SHALL BE IN AN
AGGREGATE PRINCIPAL AMOUNT EQUAL TO THE AGGREGATE PRINCIPAL AMOUNT OF SUCH
SURRENDERED NOTE, SHALL BE DATED THE EFFECTIVE DATE OF SUCH ASSIGNMENT AND
ACCEPTANCE AND SHALL OTHERWISE BE IN SUBSTANTIALLY THE FORM OF THE SURRENDERED
NOTE.  THEREAFTER, SUCH SURRENDERED NOTE SHALL BE MARKED CANCELED AND RETURNED
TO THE COMPANY.

 

(G)           ANY LENDER MAY, IN CONNECTION WITH ANY ASSIGNMENT OR PARTICIPATION
OR PROPOSED ASSIGNMENT OR PARTICIPATION PURSUANT TO THIS SECTION 9.11, DISCLOSE
TO THE ASSIGNEE OR PARTICIPANT OR PROPOSED ASSIGNEE OR PARTICIPANT, ANY
INFORMATION RELATING TO THE COMPANY FURNISHED TO SUCH LENDER BY OR ON BEHALF OF
THE COMPANY.

 

(H)           EACH LENDER AGREES THAT, IN CONNECTION WITH ANY ASSIGNMENT OR
PARTICIPATION OR PROPOSED ASSIGNMENT OR PARTICIPATION PURSUANT TO THIS
SECTION 9.11, THE COMPANY WILL NOT BE RESPONSIBLE FOR THE ACCURACY AND
COMPLETENESS OF ANY WRITTEN MATERIALS FURNISHED BY SUCH LENDER TO ANY ACTUAL OR
PROSPECTIVE ASSIGNEE OR PARTICIPANT, OTHER THAN COPIES OF (I) DOCUMENTS
FURNISHED TO SUCH LENDER PURSUANT TO CLAUSE (A), (B), (C) OR (D) OF SECTION 5.2
HEREOF, AND (II) ANY OTHER DOCUMENTS WHICH ARE PREPARED BY THE COMPANY FOR USE
IN SUCH CONNECTION AND WHICH CONTAIN A STATEMENT TO SUCH EFFECT.

 

(I)            NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, EACH LENDER MAY
PLEDGE AND ASSIGN ALL OR ANY PORTION OF ITS RIGHTS AND INTERESTS UNDER THE LOAN
DOCUMENTS TO ANY FEDERAL RESERVE BANK.

 

SECTION 9.12  RELEASE OF COLLATERAL.  UPON THE SALE, LEASE, TRANSFER OR OTHER
DISPOSITION OF ANY ITEM OF COLLATERAL OR ADDITIONAL COLLATERAL OF ANY LOAN PARTY
(INCLUDING, WITHOUT LIMITATION, AS A RESULT OF THE SALE, IN ACCORDANCE WITH THE
TERMS OF THE LOAN DOCUMENTS, OF THE LOAN PARTY THAT OWNS SUCH COLLATERAL OR
ADDITIONAL COLLATERAL) IN ACCORDANCE WITH THE TERMS OF THE LOAN DOCUMENTS, THE
COLLATERAL AGENT WILL, AT THE BORROWER’S EXPENSE, EXECUTE AND DELIVER TO SUCH
LOAN PARTY SUCH DOCUMENTS AS SUCH LOAN PARTY MAY REASONABLY REQUEST TO EVIDENCE
THE RELEASE OF SUCH ITEM OF COLLATERAL OR ADDITIONAL COLLATERAL FROM THE
ASSIGNMENT AND SECURITY INTEREST GRANTED UNDER THE SECURITY AGREEMENTS A OR B,
AS APPLICABLE IN ACCORDANCE WITH THE TERMS OF THE LOAN DOCUMENTS

 

SECTION 9.13  ENTIRE AGREEMENT.  THIS AGREEMENT EMBODIES THE ENTIRE AGREEMENT
AND UNDERSTANDING AMONG THE COMPANY, THE AGENT AND THE LENDERS RELATING TO THE
SUBJECT MATTER HEREOF AND SUPERSEDES ALL PRIOR PROPOSALS, AGREEMENTS AND
UNDERSTANDINGS RELATING TO THE SUBJECT MATTER HEREOF.  THE

 

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COMPANY CERTIFIES THAT IT IS RELYING ON NO REPRESENTATION, WARRANTY, COVENANT OR
AGREEMENT EXCEPT FOR THOSE SET FORTH IN THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS OF EVEN DATE HEREWITH.

 

SECTION 9.14  SEVERABILITY.  IF ANY PROVISION OF ANY LOAN DOCUMENTS SHALL BE
INVALID, ILLEGAL OR UNENFORCEABLE IN ANY RESPECT UNDER ANY APPLICABLE LAW, THE
VALIDITY, LEGALITY AND ENFORCEABILITY OF THE REMAINING PROVISIONS SHALL NOT BE
AFFECTED OR IMPAIRED THEREBY.

 

SECTION 9.15  DISCLOSURES.  EVERY REFERENCE IN THE LOAN DOCUMENTS TO DISCLOSURES
OF THE COMPANY TO THE AGENT AND THE LENDERS IN WRITING, TO THE EXTENT THAT SUCH
REFERENCES REFER TO DISCLOSURES AT OR PRIOR TO THE EXECUTION OF THIS AGREEMENT,
SHALL BE DEEMED STRICTLY TO REFER ONLY TO WRITTEN DISCLOSURES DELIVERED TO THE
AGENT AND THE LENDERS IN AN ORDERLY MANNER CONCURRENTLY WITH THE EXECUTION
HEREOF.

 

SECTION 9.16  CAPITAL ADEQUACY.

 

(A)           IF AFTER THE DATE OF THIS AGREEMENT, ANY ISSUER OR LENDER SHALL
HAVE DETERMINED THAT THE ADOPTION OR EFFECTIVENESS (REGARDLESS OF WHETHER
PREVIOUSLY ANNOUNCED) OF ANY APPLICABLE LEGAL REQUIREMENT OR TREATY REGARDING
CAPITAL ADEQUACY, OR ANY CHANGE THEREIN, OR ANY CHANGE IN THE INTERPRETATION OR
ADMINISTRATION THEREOF BY ANY GOVERNMENTAL AUTHORITY OR COMPARABLE AGENCY
CHARGED WITH THE INTERPRETATION OR ADMINISTRATION THEREOF, OR COMPLIANCE BY ANY
ISSUER OR LENDER WITH ANY REQUEST OR DIRECTIVE REGARDING CAPITAL ADEQUACY
(WHETHER OR NOT HAVING THE FORCE OF LAW) OF ANY SUCH GOVERNMENTAL AUTHORITY, HAS
OR WOULD HAVE THE EFFECT OF INCREASING THE COST OF, OR REDUCING THE RATE OF
RETURN ON THE CAPITAL OF SUCH ISSUER OR LENDER (OR ANY HOLDING COMPANY OF WHICH
SUCH ISSUER OR LENDER IS A PART) AS A CONSEQUENCE OF ITS OBLIGATIONS HEREUNDER
OR UNDER ANY LETTER OF CREDIT OR ITS NOTE TO A LEVEL BELOW THAT WHICH SUCH
ISSUER, LENDER OR HOLDING COMPANY COULD HAVE ACHIEVED BUT FOR SUCH ADOPTION,
CHANGE OR COMPLIANCE BY AN AMOUNT DEEMED BY SUCH ISSUER OR LENDER TO BE
MATERIAL, THEN FROM TIME TO TIME, UPON WRITTEN DEMAND TO THE COMPANY BY SUCH
ISSUER OR LENDER (WITH A COPY TO THE AGENT), THE COMPANY SHALL PAY TO SUCH
ISSUER OR LENDER, BUT ONLY WITH RESPECT TO PERIODS ARISING AFTER SUCH DEMAND BY
SUCH ISSUER OR LENDER AND APPLICABLE PERIODS PRIOR TO SUCH DEMAND BY SUCH ISSUER
OR LENDER IF SUCH ADOPTION, CHANGE OR COMPLIANCE IS RETROACTIVE IN APPLICATION,
SUCH ADDITIONAL AMOUNT OR AMOUNTS AS WILL COMPENSATE SUCH ISSUER, LENDER OR
HOLDING COMPANY FOR SUCH REDUCTION.

 

(B)           THE CERTIFICATE OF ANY LENDER SETTING FORTH SUCH AMOUNT OR AMOUNTS
AS SHALL BE NECESSARY TO COMPENSATE SUCH LENDER OR ITS HOLDING COMPANY AS
SPECIFIED IN SUBSECTION 9.15(A) ABOVE (AND SETTING FORTH THE CALCULATION THEREOF
IN REASONABLE DETAIL) SHALL BE DELIVERED AS SOON AS PRACTICABLE TO THE COMPANY
AND SHALL BE CONCLUSIVE AND BINDING, ABSENT MANIFEST ERROR.  THE COMPANY SHALL
PAY SUCH LENDER THE AMOUNT SHOWN AS DUE ON ANY SUCH CERTIFICATE WITHIN FIVE DAYS
AFTER SUCH LENDER DELIVERS SUCH CERTIFICATE.  IN PREPARING SUCH CERTIFICATE,
SUCH LENDER MAY EMPLOY SUCH ASSUMPTIONS AND ALLOCATIONS OF COSTS AND EXPENSES AS
IT SHALL IN GOOD FAITH DEEM REASONABLE AND MAY USE ANY REASONABLE AVERAGING AND
ATTRIBUTION METHOD.

 

SECTION 9.17  WITHHOLDING TAX.

 

(A)           AS USED IN THIS SECTION 9.17, THE FOLLOWING TERMS SHALL HAVE THE
FOLLOWING MEANINGS:

 

I.              “INDEMNIFIABLE TAX” MEANS ANY TAX, BUT EXCLUDING, IN ANY CASE,
ANY TAX THAT (A) WOULD NOT BE IMPOSED IN RESPECT OF A PAYMENT TO A LENDER UNDER
THIS AGREEMENT, UNDER THE NOTES HELD BY SUCH LENDER OR UNDER ANY OF THE OTHER
LOAN DOCUMENTS EXCEPT FOR A PRESENT OR FORMER CONNECTION BETWEEN THE
JURISDICTION OF THE GOVERNMENTAL AUTHORITY IMPOSING SUCH TAX AND SUCH HOLDER (OR
A SHAREHOLDER OR OTHER PERSON WITH AN INTEREST IN SUCH HOLDER), INCLUDING A
CONNECTION ARISING FROM SUCH HOLDER’S (OR SHAREHOLDER OF SUCH HOLDER OR SUCH
OTHER PERSON) BEING OR HAVING

 

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BEEN A CITIZEN OR RESIDENT OF SUCH JURISDICTION, OR BEING OR HAVING BEEN
ORGANIZED, PRESENT OR ENGAGED IN A TRADE OR BUSINESS IN SUCH JURISDICTION, OR
HAVING OR HAVING HAD A PERMANENT ESTABLISHMENT OR FIXED PLACE OF BUSINESS IN
SUCH JURISDICTION, BUT EXCLUDING A CONNECTION ARISING SOLELY FROM SUCH HOLDER
HAVING EXECUTED, DELIVERED, PERFORMED ITS OBLIGATIONS OR RECEIVED A PAYMENT
UNDER, OR ENFORCED, THIS AGREEMENT, THE NOTES OR ANY OTHER LOAN DOCUMENTS, OR
(B) IS IMPOSED UNDER UNITED STATES FEDERAL INCOME TAX LAW.

 

II.             “TAX” MEANS ANY PRESENT OR FUTURE TAX, LEVY, IMPOST, DUTY,
CHARGE, ASSESSMENT OR FEE OF ANY NATURE (INCLUDING INTEREST THEREON AND
PENALTIES AND ADDITIONS THERETO) THAT IS IMPOSED BY ANY GOVERNMENTAL AUTHORITY
IN RESPECT OF A PAYMENT TO A LENDER UNDER THIS AGREEMENT OR UNDER ANY OF THE
OTHER LOAN DOCUMENTS.

 

(B)           IF THE COMPANY IS REQUIRED BY ANY APPLICABLE LEGAL REQUIREMENT TO
MAKE ANY DEDUCTION OR WITHHOLDING FOR OR ON ACCOUNT OF ANY TAX FROM ANY PAYMENT
TO BE MADE BY IT UNDER THIS AGREEMENT IN RESPECT OF THE LOANS OR UNDER ANY OTHER
LOAN DOCUMENTS, THEN THE COMPANY SHALL (I) PROMPTLY NOTIFY THE APPLICABLE LENDER
HEREUNDER THAT IS ENTITLED TO SUCH PAYMENT OF SUCH REQUIREMENT TO SO DEDUCT OR
WITHHOLD SUCH TAX, (II) PAY TO THE RELEVANT AUTHORITIES THE FULL AMOUNT REQUIRED
TO BE SO DEDUCTED OR WITHHELD, (III) PROMPTLY FORWARD TO SUCH LENDER AN OFFICIAL
RECEIPT (OR CERTIFIED COPIES THEREOF), OR OTHER DOCUMENTATION REASONABLY
ACCEPTABLE TO SUCH LENDER, EVIDENCING SUCH PAYMENT TO SUCH GOVERNMENTAL
AUTHORITIES AND (IV) IF SUCH TAX IS AN INDEMNIFIABLE TAX, PAY, TO THE EXTENT
PERMITTED BY LAW, TO SUCH HOLDER, IN ADDITION TO WHATEVER NET AMOUNT OF SUCH
PAYMENT IS PAID TO SUCH LENDER, SUCH ADDITIONAL AMOUNT AS IS NECESSARY TO ENSURE
THAT THE TOTAL AMOUNT ACTUALLY RECEIVED BY SUCH LENDER (FREE AND CLEAR OF
INDEMNIFIABLE TAX) WILL EQUAL THE FULL AMOUNT OF THE PAYMENT SUCH LENDER WOULD
HAVE RECEIVED HAD NO SUCH DEDUCTION OR WITHHOLDING BEEN REQUIRED.  IF THE
COMPANY PAYS ANY ADDITIONAL AMOUNT TO A LENDER PURSUANT TO THE PRECEDING
SENTENCE AND SUCH LENDER SHALL RECEIVE A REFUND OF AN INDEMNIFIABLE TAX WITH
RESPECT TO WHICH, IN THE GOOD FAITH OPINION OF SUCH LENDER, SUCH PAYMENT WAS
MADE, SUCH LENDER SHALL PAY TO THE COMPANY THE AMOUNT OF SUCH REFUND PROMPTLY
UPON RECEIPT THEREOF.

 

(C)           IN THE EVENT THAT ANY GOVERNMENTAL AUTHORITY NOTIFIES THE COMPANY
THAT IT HAS IMPROPERLY FAILED TO WITHHOLD OR DEDUCT ANY TAX FROM A PAYMENT
RECEIVED BY ANY LENDER UNDER THIS AGREEMENT, THE COMPANY SHALL TIMELY AND FULLY
PAY SUCH TAX TO SUCH GOVERNMENTAL AUTHORITY AND SUCH LENDER SHALL, UPON RECEIPT
OF WRITTEN NOTICE OF SUCH PAYMENT, IMMEDIATELY PAY TO THE COMPANY, AN AMOUNT
NECESSARY IN ORDER THAT THE AMOUNT OF SUCH PAYMENT TO THE COMPANY AFTER PAYMENT
OF ALL TAXES WITH RESPECT TO SUCH PAYMENT, SHALL EQUAL THE AMOUNT THAT THE
COMPANY PAID TO SUCH GOVERNMENTAL AUTHORITY PURSUANT TO THIS CLAUSE (C).

 

(D)           EACH LENDER SHALL, UPON REQUEST BY THE COMPANY, TAKE REQUESTED
MEASURES TO MITIGATE THE AMOUNT OF INDEMNIFIABLE TAX REQUIRED TO BE DEDUCTED OR
WITHHELD FROM ANY PAYMENT MADE BY THE COMPANY UNDER THIS AGREEMENT OR UNDER ANY
OTHER LOAN DOCUMENTS IF SUCH MEASURES CAN, IN THE SOLE AND ABSOLUTE OPINION OF
SUCH LENDER, BE TAKEN WITHOUT SUCH LENDER SUFFERING ANY ECONOMIC, LEGAL,
REGULATORY OR OTHER DISADVANTAGE (PROVIDED, HOWEVER, THAT NO SUCH LENDER SHALL
BE REQUIRED TO DESIGNATE A FUNDING OFFICE THAT IS NOT LOCATED IN THE UNITED
STATES OF AMERICA).

 

SECTION 9.18  WAIVER OF CLAIMS.  THE COMPANY HEREBY WAIVES AND RELEASES THE
AGENT AND ALL LENDERS FROM ANY AND ALL CLAIMS OR CAUSES OF ACTION WHICH THE
COMPANY MAY OWN, HOLD OR CLAIM IN RESPECT OF ANY OF THEM AS OF THE DATE HEREOF.

 

SECTION 9.19  RIGHT OF SETOFF.  UPON THE OCCURRENCE AND DURING THE CONTINUANCE
OF ANY EVENT OF DEFAULT, THE LENDERS EACH ARE HEREBY AUTHORIZED AT ANY TIME AND
FROM TIME TO TIME, WITHOUT NOTICE TO THE COMPANY OR ANY OF THE GUARANTORS (ANY
SUCH NOTICE BEING EXPRESSLY WAIVED BY THE COMPANY AND BY THE GUARANTORS BY THEIR
EXECUTION OF A GUARANTY OR A JOINDER AGREEMENT), TO SETOFF AND APPLY ANY

 

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AND ALL DEPOSITS (GENERAL OR SPECIAL, TIME OR DEMAND, PROVISIONAL OR FINAL,
WHETHER OR NOT SUCH SETOFF RESULTS IN ANY LOSS OF INTEREST OR OTHER PENALTY, AND
INCLUDING WITHOUT LIMITATION ALL CERTIFICATES OF DEPOSIT) AT ANY TIME HELD, AND
ANY OTHER FUNDS OR PROPERTY AT ANY TIME HELD, AND OTHER INDEBTEDNESS AT ANY TIME
OWING BY SUCH LENDER TO OR FOR THE CREDIT OR THE ACCOUNT OF THE COMPANY OR ANY
SUCH GUARANTOR AGAINST ANY AND ALL OF THE INDEBTEDNESS ARISING IN CONNECTION
WITH THIS AGREEMENT IRRESPECTIVE OF WHETHER OR NOT SUCH LENDER WILL HAVE MADE
ANY DEMAND UNDER THIS AGREEMENT, THE NOTES OR ANY OTHER LOAN DOCUMENT.  EACH OF
THE COMPANY AND THE GUARANTORS (BY THEIR EXECUTION OF A GUARANTY OR A JOINDER
AGREEMENT) ALSO HEREBY GRANTS TO EACH OF THE LENDERS A SECURITY INTEREST IN AND
HEREBY TRANSFERS, ASSIGNS, SETS OVER, AND CONVEYS TO EACH OF THE LENDERS, AS
SECURITY FOR PAYMENT OF ALL LOANS AND LETTER OF CREDIT EXPOSURE AMOUNT, ALL SUCH
DEPOSITS, FUNDS OR PROPERTY OF THE COMPANY OR ANY SUCH GUARANTOR OR INDEBTEDNESS
OF ANY LENDER TO THE COMPANY OR ANY SUCH GUARANTOR.  SHOULD THE RIGHT OF ANY
LENDER TO REALIZE FUNDS IN ANY MANNER SET FORTH HEREINABOVE BE CHALLENGED AND
ANY APPLICATION OF SUCH FUNDS BE REVERSED, WHETHER BY COURT ORDER OR OTHERWISE,
THE LENDERS SHALL MAKE RESTITUTION OR REFUND TO THE COMPANY PRO RATA IN
ACCORDANCE WITH THEIR RESPECTIVE COMMITMENT PERCENTAGES.  EACH LENDER AGREES TO
PROMPTLY NOTIFY THE COMPANY AND THE AGENT AFTER ANY SUCH SETOFF AND APPLICATION,
PROVIDED THAT THE FAILURE TO GIVE SUCH NOTICE WILL NOT AFFECT THE VALIDITY OF
SUCH SETOFF AND APPLICATION.  THE RIGHTS OF THE AGENT AND THE LENDERS UNDER THIS
SECTION ARE IN ADDITION TO OTHER RIGHTS AND REMEDIES (INCLUDING WITHOUT
LIMITATION OTHER RIGHTS OF SETOFF) WHICH THE AGENT OR THE LENDERS MAY HAVE. 
THIS SECTION IS SUBJECT TO THE TERMS AND PROVISIONS OF SECTION 2.12 HEREOF.

 

SECTION 9.20  USA PATRIOT ACT.  EACH LENDER THAT IS SUBJECT TO THE REQUIREMENTS
OF THE USA PATRIOT ACT (TITLE III OF PUB.  L.  107-56 (SIGNED INTO LAW
OCTOBER 26, 2001)) (THE “ACT”) HEREBY NOTIFIES THE COMPANY THAT PURSUANT TO THE
REQUIREMENTS OF THE ACT, IT IS REQUIRED TO OBTAIN, VERIFY AND RECORD INFORMATION
THAT IDENTIFIES THE COMPANY, WHICH INFORMATION INCLUDES THE NAME AND ADDRESS OF
THE COMPANY AND OTHER INFORMATION THAT WILL ALLOW SUCH LENDER TO IDENTIFY THE
COMPANY IN ACCORDANCE WITH THE ACT, AND SUCH NOTICE IS SUFFICIENT AS TO EACH
SUCH LENDER.  THE COMPANY SHALL, AND SHALL CAUSE EACH OF ITS SUBSIDIARIES TO,
PROVIDE TO THE EXTENT COMMERCIALLY REASONABLE, SUCH INFORMATION AND TAKE SUCH
ACTIONS AS ARE REASONABLY REQUESTED BY THE AGENT OR ANY LENDER IN ORDER TO
ASSIST THE AGENT AND THE LENDERS IN MAINTAINING COMPLIANCE WITH THE ACT.

 

SECTION 9.21  NON-CONSENTING LENDERS; OTHER LENDERS.  IF AT ANY TIME, ANY LENDER
BECOMES A NON-CONSENTING LENDER OR MAKES A DEMAND FOR INCREASED COSTS OR A
WITHHOLDING TAX GROSS-UP UNDER SECTION 2.10 OR SECTION 9.17, THEN THE COMPANY
MAY, AT ITS SOLE COST AND EXPENSE, ON FIVE BUSINESS DAYS’ PRIOR WRITTEN NOTICE
TO THE AGENT AND SUCH LENDER, REPLACE SUCH LENDER BY CAUSING SUCH LENDER TO (AND
SUCH LENDER SHALL BE OBLIGATED TO) ASSIGN PURSUANT TO SECTION 9.11 ALL OF ITS
RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT TO ONE OR MORE ELIGIBLE ASSIGNEES;
PROVIDED THAT NEITHER THE AGENT NOR ANY LENDER SHALL HAVE ANY OBLIGATION TO THE
COMPANY TO FIND A REPLACEMENT LENDER OR OTHER SUCH PERSON; PROVIDED, FURTHER,
THAT SUCH NON-CONSENTING LENDER OR OTHER LENDER SHALL BE ENTITLED TO RECEIVE THE
FULL OUTSTANDING PRINCIPAL AMOUNT OF LOANS SO ASSIGNED, TOGETHER WITH ACCRUED
INTEREST AND FEES PAYABLE IN RESPECT OF SUCH LOANS AS OF THE DATE OF SUCH
ASSIGNMENT AND ANY OTHER COSTS PAYABLE TO SUCH LENDER UNDER THIS AGREEMENT.

 

SECTION 9.22  CONFIDENTIALITY.  NEITHER THE AGENT NOR ANY LENDER SHALL DISCLOSE
ANY CONFIDENTIAL INFORMATION TO ANY PERSON WITHOUT THE PRIOR WRITTEN CONSENT OF
THE COMPANY, OTHER THAN (A) TO SUCH AGENT’S OR SUCH LENDER’S AFFILIATES AND
THEIR OFFICERS, DIRECTORS, EMPLOYEES, AGENTS AND ADVISORS AND TO ACTUAL OR
PROSPECTIVE ELIGIBLE ASSIGNEES AND PARTICIPANTS, AND THEN ONLY ON A CONFIDENTIAL
BASIS, (B) AS REQUIRED BY ANY LAW, RULE OR REGULATION OR JUDICIAL PROCESS,
PROVIDED THAT TO THE EXTENT PRACTICABLE AND PERMITTED BY APPLICABLE LAW, THE
PARTY REQUESTED TO DISCLOSE ANY INFORMATION WILL PROVIDE PROMPT WRITTEN NOTICE
OF SUCH REQUEST TO THE COMPANY, WILL ALLOW THE COMPANY A REASONABLE OPPORTUNITY
TO SEEK APPROPRIATE PROTECTIVE MEASURES PRIOR TO DISCLOSURE (AT THE COMPANY’S
SOLE COST AND EXPENSE), (C) AS REQUESTED OR REQUIRED BY ANY STATE, FEDERAL OR
FOREIGN AUTHORITY OR EXAMINER (INCLUDING THE NATIONAL

 

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ASSOCIATION OF INSURANCE COMMISSIONERS OR ANY SIMILAR ORGANIZATION OR
QUASI-REGULATORY AUTHORITY) REGULATING SUCH LENDER, (D) TO ANY RATING AGENCY
WHEN REQUIRED BY IT, PROVIDED THAT, PRIOR TO ANY SUCH DISCLOSURE, SUCH RATING
AGENCY SHALL UNDERTAKE TO PRESERVE THE CONFIDENTIALITY OF ANY CONFIDENTIAL
INFORMATION RELATING TO THE LOAN PARTIES RECEIVED BY IT FROM SUCH LENDER, (E) TO
THE EXTENT REASONABLY NECESSARY AFTER CONSULTATION WITH COUNSEL, IN CONNECTION
WITH ANY LITIGATION OR PROCEEDING TO WHICH THE AGENT OR SUCH LENDER OR ANY OF
ITS AFFILIATES MAY BE A PARTY, PROVIDED THAT, TO THE EXTENT REASONABLY
PRACTICABLE, THE PARTY REQUESTED TO DISCLOSE ANY SUCH INFORMATION WILL PROVIDE
PROMPT WRITTEN NOTICE OF SUCH REQUEST TO THE COMPANY AND WILL ALLOW THE COMPANY
A REASONABLE OPPORTUNITY TO SEEK APPROPRIATE PROTECTIVE MEASURES PRIOR TO SUCH
DISCLOSURE) OR (F) IN CONNECTION WITH THE EXERCISE OF ANY RIGHT OR REMEDY UNDER
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT.

 

SECTION 9.23  TERMINATION OF EXISTING REVOLVING CREDIT FACILITY.    REFERENCE IS
HEREBY MADE TO THAT CERTAIN THIRD AMENDED AND RESTATED CREDIT AGREEMENT DATED
EFFECTIVE OCTOBER 1, 2004 BY AND BETWEEN THE BORROWER, THE AGENT AND THE
FINANCIAL INSTITUTIONS THAT ARE PARTIES THERETO AS A “LENDER” (COLLECTIVELY THE
“EXISTING FACILITY LENDERS”), AS PREVIOUSLY AMENDED PURSUANT TO THE TERMS OF
THAT CERTAIN FIRST AMENDMENT OF THIRD AMENDED AND RESTATED CREDIT AGREEMENT
DATED EFFECTIVE NOVEMBER 7, 2005, EXECUTED BY AND AMONG THE BORROWER, THE AGENT
AND THE EXISTING FACILITY LENDERS, AND THAT CERTAIN SECOND AMENDMENT OF THIRD
AMENDED AND RESTATED CREDIT AGREEMENT DATED EFFECTIVE DECEMBER 15, 2006,
EXECUTED BY AND AMONG THE BORROWER, THE AGENT AND THE EXISTING FACILITY LENDERS
(SAID THIRD AMENDED AND RESTATED CREDIT AGREEMENT, AS NOW OR HEREAFTER AMENDED,
MODIFIED, RESTATED, AND SUPPLEMENTED FROM TIME TO TIME, SHALL HEREINAFTER BE
COLLECTIVELY REFERRED TO AS THE “EXISTING FACILITY CREDIT AGREEMENT”).   BY
THEIR EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER, THE AGENT AND THE
EXISTING FACILITY LENDERS AGREE THAT (A) AS OF THE EFFECTIVE DATE, THE AGGREGATE
COMMITMENT (AS DEFINED IN THE EXISTING FACILITY CREDIT AGREEMENT) HAS BEEN
PERMANENTLY TERMINATED, (B) THE AGENT AND THE EXISTING FACILITY LENDERS HAVE NO
FURTHER COMMITMENTS OR OTHER OBLIGATIONS UNDER THE TERMS OF THE EXISTING
FACILITY CREDIT AGREEMENT, AND (C) EXCEPT FOR INDEMNIFICATION OBLIGATIONS THAT
SURVIVE THE TERMINATION OF THE EXISTING FACILITY CREDIT AGREEMENT, THE BORROWER
HAS NO FURTHER OBLIGATIONS UNDER THE TERMS OF THE EXISTING FACILITY CREDIT
AGREEMENT.

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date set forth above.

 

 

 

WHOLE FOODS MARKET, INC., as the Company

 

 

 

By:

 

 

 

Name:

Glenda Chamberlain

 

 

Title:

Exec. Vice President

 

Whole Foods Market, Inc. – Revolving Credit Agreement Signature Page

 

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JPMORGAN CHASE BANK, N.A., as the Agent

 

 

 

By:

 

 

 

Name:

Joe E. Holt

 

 

Title:

Chairman – Austin Region

 

 

 

JPMORGAN CHASE BANK, N.A., as Lender

 

 

 

By:

 

 

 

Name:

Joe E. Holt

 

 

Title:

Chairman – Austin Region

 

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ROYAL BANK OF CANADA, as Lender

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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Wells Fargo Bank, N.A., as Lender

 

 

 

By:

 

 

 

Name:

Susan L. Coulter

 

 

Title:

Vice President

 

Whole Foods Market, Inc. – Revolving Credit Agreement Signature Page

 

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LaSalle Bank Midwest

 

National Association, as Lender

 

 

 

By:

 

 

 

Name:

Matthew R. Klein

 

 

Title:

Assistant Vice President

 

Whole Foods Market, Inc. – Revolving Credit Agreement Signature Page

 

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Wachovia Bank, N.A., as Lender

 

 

 

By:

 

 

 

Name:

Beth Rue

 

 

Title:

Vice President

 

Whole Foods Market, Inc. – Revolving Credit Agreement Signature Page

 

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Fortis Capital, as Lender

 

 

 

By:

 

 

 

Name:

Gill Dickson

 

 

Title:

Director

 

 

 

By:

 

 

 

Name:

Timothy Streb

 

 

Title:

Managing Director

 

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US Bank, N.A., as Lender

 

 

 

By:

 

 

 

Name:

Patrick McGraw

 

 

Title:

Vice President

 

Whole Foods Market, Inc. – Revolving Credit Agreement Signature Page

 

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Bank of America, N.A., as Lender

 

 

 

By:

 

 

 

Name:

Thomas J. Kane

 

 

Title:

Senior Vice President

 

Whole Foods Market, Inc. – Revolving Credit Agreement Signature Page

 

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EXHIBIT A

 

FORM OF

REVOLVING NOTE

 

$                            ,

                            , 2007

 

FOR VALUE RECEIVED, WHOLE FOODS MARKET, INC. (herein called “Company”), a Texas
corporation, promises to pay to the order of
                                     (herein called “Payee”), at the account
specified by the Payee or at such other place as the Payee may hereafter
designate in writing, in immediately available funds and in lawful money of the
United States of America, the principal sum of                           
Dollars ($                       ) (or the unpaid balance of all principal
advanced against this Revolving Note, if that amount is less), together with
interest on the unpaid principal balance of this Revolving Note from time to
time outstanding until maturity at the rate or rates provided for in the
Revolving Credit Agreement referred to below and interest on all past due
amounts, both principal and accrued interest, at the Past Due Rate.

 

This Revolving Note has been issued pursuant to the terms of, and is entitled to
the benefits of, the Revolving Credit Agreement, dated as of
[                      ], 2007 (as the same may be amended, restated, modified
or supplemented from time to time, the “Revolving Credit Agreement”), by and
among the Company, JPMorgan Chase Bank, N.A., as administrative agent (in such
administrative capacity, the “Agent”), JPMorgan Chase Bank, N.A., as collateral
agent, Royal Bank of Canada , as syndication agent, Payee and certain other
signatory financial institutions named therein or which may be a party thereto
from time to time, to which reference is made for all purposes.  Advances
against this Revolving Note by Payee or other holders hereof, payments and
prepayments hereunder and acceleration hereof shall be governed by the Revolving
Credit Agreement.  Capitalized words and phrases used herein and not defined
herein and which are defined in the Revolving Credit Agreement shall have the
same meanings herein as are ascribed to them in the Revolving Credit Agreement.

 

The unpaid principal balance of this Revolving Note at any time shall be the
total of all principal lent or advanced against this Revolving Note less the sum
of all principal payments and permitted prepayments made on this Revolving Note
by or for the account of Company.  All Loans and advances and all payments and
permitted prepayments made hereon may be endorsed by the holder of this
Revolving Note on the schedule which is attached hereto (and hereby made a part
hereof for all purposes) or otherwise recorded in the holder’s records;
provided, that any failure to make notation of (a) any advance shall not cancel,
limit or otherwise affect Company’s obligations or any holder’s rights with
respect to that advance, or (b) any payment or permitted prepayment of principal
shall not cancel, limit or otherwise affect Company’s entitlement to credit for
that payment as of the date received by the holder.

 

Company and any and all co-makers, endorsers, guarantors and sureties severally
waive notice (including, but not limited to, notice of intent to accelerate and
notice of acceleration, notice of protest and notice of dishonor), demand,
presentment for payment, protest, diligence in collecting and the filing of suit
for the purpose of fixing liability and consent that the time of payment hereof
may be extended and re-extended from time to time without notice to any of
them.  Each such person agrees that his, her or its liability on or with respect
to this Revolving Note shall not be affected by any release of or change in any
guaranty or security at any time existing or by any failure to perfect or
maintain perfection of any lien against or security interest in any such
security or the partial or complete unenforceability of any guaranty or other
surety obligation, in each case in whole or in part, with or without notice and
before or after maturity.

 

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

 

This Revolving Note shall be governed by, and construed in accordance with, the
laws of the State of New York.

 

 

 

WHOLE FOODS MARKET, INC.

 

a Texas corporation

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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

 

LOANS AND PAYMENTS OF PRINCIPAL

 

Date

 

Amount of Loan

 

Amount of
Principal Paid or
Prepaid

 

Unpaid Principal
Balance

 

Notation Made By

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

EXHIBIT B

 

NOTICE OF ASSUMPTION

 

Reference is made to that certain Revolving Credit Agreement dated as of
                      , 2007 (as the same may have heretofore been amended,
restated, modified and supplemented from time to time, the “Revolving Credit
Agreement”), by and among Whole Foods Market, Inc., certain financial
institutions from time to time a party thereto, JPMorgan Chase Bank, N.A., in
its capacity as administrative agent on behalf of said financial institutions
(in such capacity, the “Agent”), JPMorgan Chase Bank, N.A., as collateral agent,
and Royal Bank of Canada, as syndication agent.  Terms used herein and not
defined herein shall have the same meanings herein as are ascribed to them in
the Revolving Credit Agreement.

 

[Pursuant to Section 6.4(x) of the Revolving Credit Agreement, the undersigned
Subsidiary hereby gives notice to the Agent that [the entities listed on
Exhibit A attached hereto and incorporated herein by reference (the “Merged
Guarantors”) have] [                   (the “Merged Guarantor”), a
                     corporation, has] been merged into the undersigned
Subsidiary effective as of                      , 20       and the undersigned
Subsidiary is the surviving Business Entity.  The undersigned Person is liable
for, and does hereby assume all of, the obligations of the Merged Guarantor[s]
under the Guaranties and the Contribution Agreement and shall be a “Guarantor”
thereunder for all purposes.]

 

[Pursuant to Section 6.4(y) of the Revolving Credit Agreement, the undersigned
Subsidiary (the “Transferor Subsidiary Guarantor”) hereby gives notice to the
Agent that the undersigned has acquired, purchased, leased or received all of
the Stock and/or assets of [                                    ] (the
“Transferee Subsidiary Guarantor”) effective as of                      ,
20      .  The undersigned does hereby assume and is hereby liable for, all of
the obligations of the Transferor Subsidiary Guarantor under the Guaranties and
the Contribution Agreement and shall be a “Guarantor” thereunder for all
purposes.]

 

EXECUTED the      day of                     , 20      .

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

[Attachment: Exhibit A - List of Merged Guarantors]

 

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

 

EXHIBIT C

 

OFFICER’S CERTIFICATE

 

Date:                 

 

JPMorgan Chase Bank, N.A.

221 W. 6th Street, Austin, Texas 78701

Mail Code TX3-8229

Fax: 512-479-2814

Attention:  Manager, Commercial Lending Group

 

Re:       Financial Statements Required under Revolving Credit Agreement (as the
same may have been amended, modified and restated from time to time, the
“Revolving Credit Agreement”) dated as of                                 ,
2007, by and among Whole Foods Market, Inc., the financial institutions or party
thereto from time to time, JPMorgan Chase Bank, N.A., as Administrative Agent
and Collateral Agent, and Royal Bank of Canada, as Syndication Agent.

 

Ladies and Gentlemen:

 

Reference is made to the above referenced Revolving Credit Agreement. 
Capitalized words and phrases used herein and not defined herein and defined in
the Revolving Credit Agreement are used herein with the same meanings as are
assigned to them in the Revolving Credit Agreement.

 

The undersigned hereby certifies, warrants and represents to the addressee named
above that:

 

(1)  He or she is the duly appointed and acting(1)                      of the
Company;

 

[Use following paragraph 1 for fiscal year-end financial statements]

 

(2)  This Certificate is delivered in conjunction with the Annual Audited
Financial Statements of the Company and its Subsidiaries for the fiscal year of
the Company ended as of                                 , 20      , together
with the annual audit report and opinion of an independent certified public
accountant for such fiscal year that are required to be delivered by
Section 5.2(a) of the Revolving Credit Agreement.  Each such document referred
to herein is currently available on the website of the Securities and Exchange
Commission at http://www.sec.gov.

 

[Use following paragraph 1 for fiscal quarter-end financial statements]

 

(2)  This Certificate is delivered in conjunction with the consolidated
Quarterly Unaudited Financial Statements of the Company and its Subsidiaries
required by Section 5.2(b) of the Revolving Credit Agreement for the fiscal
quarter of the Company ended as of the above date.  Each such document referred
to herein is currently available on the website of the Securities and Exchange
Commission at http://www.sec.gov.

 

(3)  Based on my knowledge, the financial statements do not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by the financial
statements.

 

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

(1)  Must be the chief executive officer, president, chief operating officer or
chief financial officer of the Company.

 

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

 

(4)  As of the end of the period covered by the attached financial statements:

 

(a)  LEVERAGE RATIO:

 

(i)

Funded Indebtedness: $

 

 

 

 

(ii)

EBIT of the Company and its Subsidiaries for the Rolling Four Quarters:

$             

 

 

 

(iii)

Depreciation, depletion, obsolescence and amortization of the Company and its
Subsidiaries for the Rolling Four Quarters:

$               

 

 

 

(iv)

EBITDA for the Rolling, Four Quarters (the sum of (ii) plus (iii)):

$                

 

 

 

(v)

Required Leverage Ratio (not more than):

3.00 to 1.00

 

 

 

(vi)

Actual Leverage Ratio: ((i) to (iv))

          to 1.00

 

(b)  FIXED CHARGE COVERAGE RATIO:

 

(i)

EBIT for the Rolling Four Quarters (see a(ii) above)

$              

 

 

 

(ii)

Operating Lease Expense for the Rolling Four Quarters:(2)

$              

 

 

 

(iii)

(i) plus (ii) =

$              

 

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

(2)

For the fiscal quarter ended (i) September 30, 2007, such amount shall equal
such item for such fiscal quarter multiplied by 52/13, (ii) January 20, 2008,
such amount to equal such item for such fiscal quarter multiplied by 52/29, and
(iii) April 30, 2008, such amount to equal such item for such fiscal quarter
multiplied by 52/41.

 

 

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

 

(iv)

Interest expense for the Rolling Four Quarters:(3)

$              

 

 

 

(v)

Operating Lease Expense for the Rolling Four Quarters (see b(ii)):

$              

 

 

 

(vi)

Fixed Charge Coverage Ratio for the applicable period (iii) to the sum of
(iv) and (v):

         to 1.00

 

 

 

(vii)

Required Fixed Charge Coverage Ratio for the Applicable period (not less than):

1.50 to 1.00

 

(c)  RESTRICTED PAYMENTS:

 

(i)

Aggregate cost paid by Company for Stock redeemed or repurchased on or after
[             , 2007]:

$                    

 

 

 

(ii)

Aggregate cash dividends paid by Company to owners of Stock on or after
[                , 2007]:

$                    

 

 

 

(iii)

Amount of permitted “restricted payments” described in (i) & (ii) (See
Section 6.11):

 

 

 

 

 

(A)

Initial threshold — $[150,000,000]

 

 

 

 

 

 

(B)

[50]% of the aggregate of Net Income, depreciation, amortization and non-cash
stock compensation expense of the Company and its Subsidiaries, on a
consolidated basis, for each fiscal quarter of the Company ending after
[                        , 2007] — $                  

 

 

 

 

 

 

(C)

Sum of (A) & (B):

$                  .

 

(4)  (Check either (a) or (b) )

 

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

(3)

For the fiscal quarter ended (i) September 30, 2007, such amount shall equal
such item for such fiscal quarter multiplied by 52/13,  (ii) January 20, 2008,
such amount to equal such item for such fiscal quarter multiplied by 52/29, and
(iii) April 30, 2008, such amount to equal such item for such fiscal quarter
multiplied by 52/41.

 

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

 

(a)                    The Company has kept, observed, performed and fulfilled
each and every one of its covenants and obligations under the Revolving Credit
Agreement during the period covered by the attached financial statements and no
Default or Event of Default has occurred and is continuing.

 

(b)                   The Company has kept, observed, performed and fulfilled
each and every one of the covenants and obligations under the Revolving Credit
Agreement during the period covered by the attached financial statements except
for the following matters: [Describe all such defaults, specifying the nature,
duration and status thereof and what action the Company has taken or proposes to
take with respect thereto].

 

(5)  The representations and warranties of the Company contained in Article IV
of the Agreement, or which are contained in any document furnished at any time
under or in connection with the Loan Documents, are true and correct in all
material respects on and as of the date hereof, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, and except that for
purposes of this Officer’s Certificate, the representations and warranties
contained in Section 4.2 of the Revolving Credit Agreement shall be deemed to
refer to the most recent statements furnished pursuant to clause (a) and (b),
respectively, of Section 5.2 of the Revolving Credit Agreement, including the
statements in connection with which this Officer’s Certificate is delivered.

 

 

 

 

 

Name:

 

Title:

 

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

 

EXHIBIT D

 

[Company Letterhead]

 

REQUEST FOR EXTENSION OF CREDIT

 

Date:                   

 

JPMorgan Chase Bank, N.A.

221 W. 6th Street, Austin, Texas 78701

Mail Code TX3-8229

Fax: 512-479-2814

Attention:  Manager, Commercial Lending Group

 

Re:          Loan under Revolving Credit Agreement dated as of               ,
2007, by and among Whole Foods Market, Inc., a Texas corporation, the financial
institutions a party thereto from time to time, JPMorgan Chase Bank, N.A., as
Administrative Agent (in such capacity, the “Agent”), JPMorgan Chase Bank, N.A.,
as Collateral Agent, and Royal Bank of Canada, as Syndication Agent (as the same
may have been amended, modified and/or restated from time to time, the
“Revolving Credit Agreement”).

 

Ladies and Gentlemen:

 

Reference is made to the above referenced Revolving Credit Agreement. 
Capitalized words and phrases used herein but not defined herein which are
defined in the Revolving Credit Agreement are used herein with the same meanings
as are ascribed to them in the Revolving Credit Agreement.

 

The Company requests that a Loan be made under the Revolving Credit Agreement in
the amount of $[        ],000,000  and that such Loan be made on
                , 2007, which is a Business Day, or in the case of a LIBOR Rate
Borrowing, a LIBOR Business Day (unless this request for a Loan is received by
the Agent after 12:00 noon in which case, then on the next to occur Business
Day, or in the case of a LIBOR Rate Borrowing, the next to occur LIBOR Business
Day, hereafter).

 

The Loan is to be an (check one) [  ] Alternate Base Rate Borrowing [  ] LIBOR
Rate Borrowing.  If the Loan is to be a LIBOR Rate Borrowing, the LIBOR Interest
Period is to be (check one) [  ] one [  ] two [  ] three [  ] six months.

 

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

 

The proceeds of the advances should be disbursed to the following account:

 

[Bank]

[Bank Address]

[Account Name]

[Account Number]

[ABA#]

 

 

Very truly yours,

 

 

 

WHOLE FOODS MARKET, INC., a Texas corporation

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

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

 

EXHIBIT E

 

RATE SELECTION NOTICE

 

Whole Foods Market, Inc., a Texas corporation, certain financial institutions
signatory thereto (collectively, the “Lenders”), JPMorgan Chase Bank, N.A., as
Administrative Agent for and on behalf of the Lenders, JPMorgan Chase Bank,
N.A., as Collateral Agent and Royal Bank of Canada, as Syndication Agent
executed and delivered that certain Revolving Credit Agreement (as amended,
supplemented and restated, the “Revolving Credit Agreement”) dated as of
                    , 2007.  Any term used herein and not otherwise defined
herein shall have the meaning herein ascribed to it in the Revolving Credit
Agreement.

 

In accordance with the Revolving Credit Agreement, the Company hereby notifies
the Agent of the exercise of an Interest Option.

 

A.

Current borrowing

 

 

 

1.

Interest Option now in effect:

 

 

 

 

 

 

 

 

2.

Amount:

 

$                

 

 

 

 

 

 

3.

Expiration of current Interest Period, if applicable:

 

, 200  

 

 

 

 

 

B.

Proposed borrowing

 

 

 

 

 

 

 

 

1.

Amount:

 

$                

 

 

 

 

 

 

2.

Date Interest Option is to be effective:

          , 200   

 

 

 

 

 

 

 

3.

Interest Option to be applicable (check one):

 

 

 

 

 

 

 

 

 

o

Alternate Base Rate

 

 

 

 

 

 

 

 

 

 

o

LIBOR Rate

 

 

 

 

 

 

 

 

 

4.

Interest period (check one if applicable):

 

 

 

 

 

 

 

 

 

 

o

1 month

 

 

 

 

 

 

 

 

 

 

o

2 months

 

 

 

 

 

 

 

 

 

 

o

3 months

 

 

 

 

 

 

 

 

 

 

o

6 months

 

 

 

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

 

The Company represents and warrants that the Interest Option and the interest
period (if applicable) selected above comply with all provisions of the
Revolving Credit Agreement and that there exists no Event of Default or any
event which, with the passage of time, the giving of notice or both, would be an
Event of Default.

 

 

WHOLE FOODS MARKET, INC., a Texas corporation

 

 

 

 

 

By:

 

 

Date:            200   

Name:

 

 

 

Title:

 

*

 

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

* Must be the chief executive officer, president, chief operating officer or
chief financial officer of the Company.

 

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

 

EXHIBIT F

 

FORM OF

ASSIGNMENT AND ACCEPTANCE

 

Dated:                  , 200   

 

Reference is made to the Revolving Credit Agreement dated as of              ,
2007 (as restated, amended, modified, supplemented and in effect from time to
time, the “Revolving Credit Agreement”), among Whole Foods Market, Inc., a Texas
corporation (the “Company”), the financial institutions from time to time a
party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent (the “Agent”),
JPMorgan Chase Bank, N.A., as Collateral Agent and Royal Bank of Canada, as
Syndication Agent.  Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Revolving Credit
Agreement.  This Assignment and Acceptance, between the Assignor (as set forth
on Schedule I attached hereto and made a part hereof by reference for all
purposes) and the Assignee (as set forth on Schedule I hereto and made a part
hereof), is dated as of the Effective Date (as set forth on Schedule I hereto
attached).

 

1.  Each Assignor hereby irrevocably sells and assigns to each Assignee without
recourse to the Assignor, and each Assignee hereby irrevocably purchases and
assumes from such Assignor without recourse to the Assignor, as of the Effective
Date, an undivided interest (the “Assigned Interest”) in and to all such
Assignor’s rights and obligations under the Revolving Credit Agreement
respecting the credit facility and only the credit facility provided for in the
Revolving Credit Agreement (the “Facility”), in a principal amount as set forth
on Schedule I.

 

2.  Each Assignor (i) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Revolving Credit Agreement or any other Loan
Document or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Revolving Credit Agreement, any other Loan Document
or any other instrument or document furnished pursuant thereto, other than that
it is the legal and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any adverse claim;
(ii) makes no representation or warranty and assumes no responsibility with
respect to the financial condition of the Company or its Subsidiaries or the
performance or observance by the Company or its Subsidiaries of any of its
respective obligations under the Revolving Credit Agreement, any other Loan
Document or any other instrument or document furnished pursuant thereto; and
(iii) attaches the Revolving Note (if any) held by it and requests that the
Agent exchange such Revolving Note for a new Revolving Note payable to such
Assignor (if such Assignor has retained any interest in the Facility) and a new
Revolving Note payable to such Assignee in the respective amounts which reflect
the assignment being made hereby (and after giving effect to any other
assignments which have become effective on the Effective Date).

 

3.  Each Assignee (i) represents and warrants that it is legally authorized to
enter into this Assignment and Acceptance and that it is an Eligible Assignee
(as that term is defined in the Revolving Credit Agreement); (ii) confirms that
it has received a copy of the Revolving Credit Agreement, together with copies
of the financial statements referred to in Section 4.2 thereof, or if later the
most recent financial statements delivered pursuant to Section 5.2 thereof, and
such other documents and information as it has deemed appropriate to make its
own credit analysis; (iii) agrees that it will, independently and without
reliance upon the Agent, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Revolving
Credit Agreement; (iv) appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers under the Revolving Credit
Agreement as are delegated to the Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (v) agrees that it will be bound by
the provisions of the Revolving Credit Agreement and will

 

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

 

perform in accordance with its terms all the obligations which by the terms of
the Revolving Credit Agreement are required to be performed by it as a Lender;
(vi) if such Assignee is organized under the laws of a jurisdiction outside the
United States, attaches the forms prescribed by the Internal Revenue Service of
the United States certifying as to the Assignee’s exemption from United States
withholding taxes with respect to all payments to be made to the Assignee under
the Revolving Credit Agreement or such other documents as are necessary to
indicate that all such payments are subject to such tax at a rate reduced by an
applicable tax treaty, and (vii) has supplied the information requested on the
administrative questionnaire attached hereto as Exhibit A.

 

4.  Following the execution of this Assignment and Acceptance, it will be
delivered to the Agent, together with a processing and recordation fee of
$3,500, for acceptance by it and the Company and recording by the Agent pursuant
to Section 9.11 of the Revolving Credit Agreement, effective as of the Effective
Date (which Effective Date shall, unless otherwise agreed to by the Agent in it
sole and absolute discretion, be at least five Business Days after the execution
of this Assignment and Acceptance).

 

5.  Upon such acceptance and recording, from and after the Effective Date, the
Agent shall make all payments in respect of the Assigned Interest (including
payments of principal, interest, fees and other amounts) to such Assignee,
whether such amounts have accrued prior to the Effective Date or accrue
subsequent to the Effective Date.  Each Assignor and each Assignee shall make
all appropriate adjustments in payments for periods prior to the Assignment
Effective Date by the Agent or with respect to the making of this assignment
directly between themselves.

 

6.  From and after the Effective Date, (i) each Assignee shall be a party to the
Revolving Credit Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Lender thereunder, and
(ii) each Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations under the
Revolving Credit Agreement provided that such Assignor hereby represents and
warrants that restrictions set forth in Section 9.11 of the Revolving Credit
Agreement pertaining to the minimum amount of assignments has been satisfied.

 

7.  This Assignment and Acceptance shall be governed by, and construed in
accordance with, the laws of the State of New York.

 

8.  This Assignment and Acceptance may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.  Delivery of an executed counterpart of
Schedule I to this Assignment and Acceptance by telecopier or electronic format
shall be effective as delivery of an original executed counterpart of this
Assignment and Acceptance.

 

IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed by their respective duly authorized officers on
Schedule I attached hereto.

 

[The remainder of this page is intentionally left blank.]

 

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

 

SCHEDULE 1
TO
ASSIGNMENT AND ACCEPTANCE

 

Effective Date:

 

                                          , 2007(4)

 

Assignor

 

 

                    , as Assignor

 

[Type or print legal name of Assignor]

 

 

 

 

 

By

 

 

 

Name:

 

 

Title:

 

 

 

Dated:                     , 200   

 

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

(4)   This date should be no earlier than five Business Days after the delivery
of this Assignment and Acceptance to the Agent.

 

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

 

Assignee

 

 

                      , as Assignee

 

[Type or print legal name of Assignee]

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

Dated:                     , 200  

 

Lending Office:

 

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

 

Accepted:

 

 

 

JPMORGAN CHASE BANK, N.A., as Agent

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

WHOLE FOODS MARKET, INC.

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

*

 

 

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

*   Must be the chief executive officer, president, chief operating officer or
chief financial officer of the Company

 

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

 

SCHEDULE 1
TO
ASSIGNMENT AND ACCEPTANCE

 

ASSIGNORS:

 

 

 

Percentage interest assigned

 

 

%

Aggregate outstanding principal amount of Revolving Loans assigned

 

$

 

Principal amount of Revolving Note payable to Assignor

 

$

 

 

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

 

EXHIBIT G-A

 

FORM OF

SECURITY AGREEMENT A

 

(See Attached)

 

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

 

SECURITY AGREEMENT A

 

Dated [                           ], 2007

 

From

 

WHOLE FOODS MARKET, INC.,

 

as Grantor

 

- and -

 

the other Grantors referred to herein

 

as Grantors

 

to

 

JPMORGAN CHASE BANK, N.A.

 

as Collateral Agent

 

2

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

 

T A B L E  O F  C O N T E N T S

 

Section

 

Page

 

 

 

Section 1. Grant of Security

 

1

 

 

 

Section 2. Security for Obligations; Interpretation

 

2

 

 

 

Section 3. Grantors Remain Liable

 

3

 

 

 

Section 4. Representations and Warranties

 

3

 

 

 

Section 5. Further Assurances

 

4

 

 

 

Section 6. Post-Closing Changes

 

4

 

 

 

Section 7. Voting Rights; Dividends; Etc.

 

4

 

 

 

Section 8. Transfers and Other Liens; Additional Shares

 

5

 

 

 

Section 9. Collateral Agent Appointed Attorney-in-Fact

 

5

 

 

 

Section 10. Collateral Agent May Perform

 

6

 

 

 

Section 11. The Collateral Agent’s Duties

 

6

 

 

 

Section 12. Remedies

 

8

 

 

 

Section 13. Indemnity and Expenses

 

9

 

 

 

Section 14. Amendments; Waivers; Additional Grantors; Etc.

 

9

 

 

 

Section 15. Notices, Etc.

 

9

 

 

 

Section 16. Continuing Security Interest; Assignments under the Loan Agreements

 

10

 

 

 

Section 17. Release; Termination

 

10

 

 

 

Section 18. Execution in Counterparts

 

10

 

 

 

Section 19. Jurisdiction; Governing Law; Etc

 

10

 

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

 

SCHEDULES

 

Schedule I

 

-

 

Initial Pledged Equity and Initial Pledged Debt

Schedule II

 

-

 

Location, Chief Executive Office, Place Where Agreements Are Maintained, Type Of
Organization, Jurisdiction Of Organization And Organizational Identification
Number

Schedule III

 

-

 

Changes in Name, Location, Etc.

 

 

 

 

 

EXHIBIT

 

 

 

 

 

 

 

 

 

Exhibit A

-

 

 

Form of Security Agreement A Supplement

 

ii

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SECURITY AGREEMENT A

 

SECURITY AGREEMENT dated [                         ], 2007 made by WHOLE FOODS
MARKET, INC., a Texas corporation (the “Borrower”), and the other Persons listed
on the signature pages hereof (the Borrower and the Persons so listed being,
collectively, the “Grantors”), to JPMORGAN CHASE BANK, N.A. (“JPMorgan”), as
collateral agent (in such capacity, and together with any successor collateral
agent appointed pursuant to this Agreement, the “Collateral Agent”) for the
Secured Parties (as defined below).

 

PRELIMINARY STATEMENTS.

 

1.                                       The Borrower has entered into a Term
Loan Agreement dated as of August [ ], 2007 among the Borrower, Royal Bank of
Canada, as administrative agent for the lenders from time to time parties
thereto (together with its successors and assigns in such capacity, the “Term
Loan Administrative Agent”), JPMorgan Chase Bank, N.A., as Collateral Agent and
as syndication agent, and RBC Capital Markets and J. P. Morgan Securities Inc.,
as joint lead arrangers and joint bookrunners (said agreement, as it may
hereafter be amended, restated, supplemented or otherwise modified from time to
time, being the “Term Loan Agreement”).

 

2.                                       The Borrower has entered into a
Revolving Credit Agreement dated as of August [ ], 2007 among the Borrower,
JPMorgan Chase Bank, N.A., as Collateral Agent and as administrative agent for
the lenders from time to time parties thereto (together with its successors and
assigns in such capacity, the “Revolving Loan Administrative Agent”), Royal Bank
of Canada,, as syndication agent, and J. P. Morgan Securities Inc. and RBC
Capital Markets, as joint lead arrangers and joint bookrunners (said agreement,
as it may hereafter be amended, restated, supplemented or otherwise modified
from time to time, being the “Revolving Loan Agreement”). The Term Loan
Agreement and the Revolving Loan Agreement shall sometimes hereinafter be
collectively referred to as the “Loan Agreements.”

 

3.                                       In connection with the Term Loan
Agreement, certain of the Grantors (other than the Borrower) and other
affiliated entities have executed and delivered a Master Guaranty Agreement to
the Term Loan Administrative Agent dated as of August [ ], 2007, and in
connection with the Revolving Loan Agreement, the Grantors (other than the
Borrower) and other affiliated entities have executed and delivered a Master
Guaranty Agreement to the Revolving Loan Administrative Agent dated as of
August [ ], 2007 (both of said Master Guaranty Agreements, as each of the same
may hereafter be amended, restated, supplemented or otherwise modified from time
to time, being the “Master Guaranty Agreements”).

 

4.                                       It is a condition precedent to the
making of Loans by the Lenders under the Loan Agreements that the Grantors shall
have granted the security interest contemplated by this Agreement. Each Grantor
will derive substantial direct and indirect benefit from the transactions
contemplated by the Loan Agreements.

 

5.                                       Terms defined in the Loan Agreements
and not otherwise defined in this Agreement are used in this Agreement as
defined in the Loan Agreements. Further, unless otherwise defined in this
Agreement or in the Loan Agreements, terms defined in Article 8 or 9 of the UCC
(as defined below) are used in this Agreement as such terms are defined in such
Article 8 or 9. “UCC” means the Uniform Commercial Code as in effect from time
to time in the State of New York; provided that, if perfection or the effect of
perfection or non-perfection or the priority of the security interest in any
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, “UCC” means the Uniform
Commercial Code as in effect from time to time in such other jurisdiction for
purposes of the provisions hereof relating to such perfection, effect of
perfection or non-perfection or priority.

 

NOW, THEREFORE, in consideration of the premises and in order to induce the
Lenders to make Loans under the Loan Agreements, each Grantor hereby agrees with
the Collateral Agent for the ratable benefit of the Secured Parties under each
of the Loan Agreements as follows:

 

Section 1. Grant of Security. Each Grantor hereby grants to the Collateral
Agent, for the ratable benefit of the lenders from time to time party to either
or both of the Loan Agreements (together with the Collateral Agent, the Term
Loan Administrative Agent and the Revolving Loan Administrative Agent, the
“Secured Parties”) ,

 

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a security interest in such Grantor’s right, title and interest in and to the
following, in each case, as to each type of property described below, whether
now owned or hereafter acquired by such Grantor, wherever located, and whether
now or hereafter existing or arising (collectively, the “Collateral”):

 

(a)  (i)  all of such shares of capital stock, partnership interests, membership
interests in a limited liability company, beneficial interests in a trust or
other equity interests in any Person, or any obligations convertible into or
exchangeable for, or giving any Person a right, option or warrant to acquire,
such equity interests or such convertible or exchangeable obligations (any and
all such interests being the “Equity Interests”) owned by each Grantor,
including without limitation, the initial pledged equity listed in Part I of
Schedule I hereof, (the “Initial Pledged Equity”), and the certificates, if any,
representing any of the foregoing, and all dividends, distributions, return of
capital, cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of the foregoing and all subscription warrants, rights or options issued thereon
or with respect thereto; provided that, notwithstanding anything contained
herein to the contrary, such Grantor shall not be required to pledge, and the
terms “Pledged Equity” and “Collateral” used in this Agreement shall not
include, any Equity Interests in any foreign subsidiary acquired, owned, or
otherwise held by such Grantor, in each case, that, when aggregated with all of
the other shares of stock in such foreign Subsidiary pledged by such Grantor,
would result in more than 66% of the shares of stock in such foreign Subsidiary
being pledged to the Collateral Agent for the benefit of the Secured Parties
under this Agreement;

 

(ii)                                  all Equity Interests from time to time
acquired by each Grantor in any manner (such Equity Interests, together with the
Initial Pledged Equity, being the “Pledged Equity”), and the certificates, if
any, representing such additional Equity Interests, and all dividends,
distributions, return of capital, cash, instruments and other property from time
to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such Equity Interests and all subscription warrants,
rights or options issued thereon or with respect thereto;

 

(iii)                               all investment property (including, without
limitation, all (A) securities, whether certificated or uncertificated,
(B) security entitlements, (C) securities accounts, (D) commodity contracts and
(E) commodity accounts) in which such Grantor has now, or acquires from time to
time hereafter, any right, title or interest in any manner, and the certificates
or instruments, if any, representing or evidencing such investment property, and
all dividends, distributions, return of capital, interest, cash, instruments and
other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of such investment property and all
warrants, rights or options issued thereon or with respect thereto.

 

(b)                                 all indebtedness from time to time owed to
such Grantor (such indebtedness being the “Pledged Debt”) including without
limitation, the initial pledged debt listed in Part II of Schedule I hereof,
(the “Initial Pledged Debt”) and all interest, cash, instruments and other
property from time to time received, receivable or otherwise distributed in
respect of or in exchange for any of all such indebtedness.

 

(c)                                  all proceeds of, collateral for and
supporting obligations relating to, any and all of the foregoing (including,
without limitation, proceeds, collateral and supporting obligations that
constitute property of the types described in clause (a) and (b) of this
Section 1 and this clause (c)) and, to the extent not otherwise included, all
cash.

 

Notwithstanding the foregoing, “Collateral” shall not include and the Grantors
shall not be deemed to have granted a security interest in any property or
agreement of such Grantor to the extent (but only so long as) (x) the granting
of a security interest thereunder is prohibited by any applicable law or (y) is
prohibited by, or constitutes a breach or default under or results in the
termination of or requires any consent not obtained under, any contract, lease,
license, agreement, instrument or other document giving rise to such property,
in each case solely to the extent that such breach or default is not rendered
ineffective by the UCC or other applicable law or, in the case of any consent,
such consent is actually required to grant such security interest under
applicable law.

 

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Section 2. Security for Obligations; Interpretation. This Agreement secures, in
the case of each Grantor, the payment of all Indebtedness and other obligations
of such Grantor now or hereafter existing under any of the Loan Documents (as
defined in each of the Loan Agreements), whether direct or indirect, absolute or
contingent, and whether for principal, reimbursement obligations, interest,
fees, premiums, penalties, indemnifications, contract causes of action, costs,
expenses or otherwise (all such obligations being the “Secured Obligations”).
Without limiting the generality of the foregoing, this Agreement secures, as to
each Grantor, the payment of all amounts that constitute part of the Secured
Obligations and would be owed by such Grantor to any Secured Party under any of
the Loan Documents but for the fact that they are unenforceable or not allowable
due to the existence of a bankruptcy, reorganization or similar proceeding
involving a Loan Party.

 

Section 3. Grantors Remain Liable. Anything herein to the contrary
notwithstanding, (a) each Grantor shall remain liable under the contracts and
agreements included in or related to such Grantor’s Collateral to the extent set
forth therein to perform all of its duties and obligations thereunder to the
same extent as if this Agreement had not been executed, (b) the exercise by the
Collateral Agent of any of the rights hereunder shall not release any Grantor
from any of its duties or obligations under the contracts and agreements
included in or related to the Collateral and (c) no Secured Party shall have any
obligation or liability under the contracts and agreements included in or
related to the Collateral by reason of this Agreement or any other Loan
Document, nor shall any Secured Party be obligated to perform any of the
obligations or duties of any Grantor thereunder or to take any action to collect
or enforce any claim for payment.

 

Section 4. Representations and Warranties. Each Grantor represents and warrants
as follows:

 

(A)                                  AS OF THE DATE HEREOF, SUCH GRANTOR’S EXACT
LEGAL NAME, LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF ORGANIZATION, JURISDICTION
OF ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER IS SET FORTH IN
SCHEDULE II HERETO. WITHIN THE FIVE YEARS PRECEDING THE DATE HEREOF, SUCH
GRANTOR HAS NOT CHANGED ITS NAME, LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF
ORGANIZATION, JURISDICTION OF ORGANIZATION OR ORGANIZATIONAL IDENTIFICATION
NUMBER FROM THOSE SET FORTH IN SCHEDULE II HERETO EXCEPT AS SET FORTH IN
SCHEDULE III HERETO.

 

(B)                                 SUCH GRANTOR IS THE LEGAL AND BENEFICIAL
OWNER OF THE COLLATERAL GRANTED OR PURPORTED TO BE GRANTED BY IT PURSUANT TO
SCHEDULE I HEREOF, FREE AND CLEAR OF ANY LIEN, CLAIM, OPTION OR RIGHT OF OTHERS,
EXCEPT FOR THE SECURITY INTEREST CREATED UNDER THIS AGREEMENT OR PERMITTED UNDER
THE LOAN AGREEMENTS. EXCEPT AS PERMITTED UNDER THE LOAN AGREEMENTS, NO EFFECTIVE
FINANCING STATEMENT OR OTHER INSTRUMENT SIMILAR IN EFFECT COVERING ALL OR ANY
PART OF SUCH COLLATERAL OR LISTING SUCH GRANTOR OR ANY TRADE NAME OF SUCH
GRANTOR AS DEBTOR IS ON FILE IN ANY RECORDING OFFICE, EXCEPT SUCH AS MAY HAVE
BEEN FILED IN FAVOR OF THE COLLATERAL AGENT RELATING TO THE LOAN DOCUMENTS,
FILINGS WHICH HAVE NOT BEEN AUTHORIZED BY THE APPLICABLE GRANTOR OR AS OTHERWISE
PERMITTED UNDER THE LOAN AGREEMENTS.

 

(C)                                  IF SUCH GRANTOR IS AN ISSUER OF COLLATERAL,
SUCH GRANTOR CONFIRMS THAT IT HAS RECEIVED NOTICE OF THE SECURITY INTEREST
GRANTED HEREUNDER.

 

(D)                                 THE PLEDGED EQUITY PLEDGED BY SUCH GRANTOR
HEREUNDER HAS BEEN DULY AUTHORIZED AND VALIDLY ISSUED AND IS FULLY PAID AND
NON-ASSESSABLE. THE PLEDGED DEBT PLEDGED BY SUCH GRANTOR HEREUNDER HAS BEEN DULY
AUTHORIZED, AUTHENTICATED OR ISSUED AND DELIVERED, IS THE LEGAL, VALID AND
BINDING OBLIGATION OF THE ISSUERS THEREOF.

 

(E)                                  THIS AGREEMENT CREATES IN FAVOR OF THE
COLLATERAL AGENT FOR THE BENEFIT OF THE SECURED PARTIES UNDER THE LOAN
AGREEMENTS A VALID SECURITY INTEREST IN THE COLLATERAL GRANTED BY SUCH GRANTOR
(TO THE EXTENT SUCH MATTER IS GOVERNED BY THE LAWS OF THE UNITED STATES, OR A
JURISDICTION LOCATED THEREIN), SECURING THE PAYMENT OF THE SECURED OBLIGATIONS;
ALL FILINGS AND OTHER ACTIONS NECESSARY TO PERFECT THE SECURITY INTEREST IN THE
COLLATERAL GRANTED BY SUCH GRANTOR, TO THE EXTENT REQUIRED HEREUNDER, HAVE BEEN
OR WILL BE TIMELY MADE OR TAKEN AND ARE, OR WILL BE, IN FULL FORCE AND EFFECT
(TO THE EXTENT PERFECTION CAN BE ACCOMPLISHED BY SUCH FILING OR ACTION); SUCH
SECURITY INTEREST IS FIRST PRIORITY EXCEPT FOR THE LIENS PERMITTED BY THE LOAN
AGREEMENTS.

 

(F)                                    TO SUCH GRANTOR’S KNOWLEDGE, NO MATERIAL
GOVERNMENTAL AUTHORIZATION BY, AND NO NOTICE TO OR FILING WITH, ANY GOVERNMENTAL
AUTHORITY OR OTHER THIRD PARTY IS REQUIRED FOR THE GRANT BY SUCH GRANTOR OF THE
SECURITY INTEREST GRANTED HEREUNDER OR FOR THE EXECUTION, DELIVERY OR
PERFORMANCE OF THIS AGREEMENT BY SUCH GRANTOR.

 

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Section 5. Further Assurances. (a)  Each Grantor agrees that from time to time,
at the expense of such Grantor, such Grantor will promptly execute and deliver,
or otherwise authenticate, all further instruments and documents, and take all
further action that may be necessary or reasonably desirable, or that the
Collateral Agent may reasonably request, in order to perfect and maintain
perfection of any pledge or security interest granted or purported to be granted
by such Grantor hereunder or to enable the Collateral Agent to exercise and
enforce its rights and remedies hereunder with respect to any Collateral of such
Grantor. Without limiting the generality of the foregoing, each Grantor will
promptly with respect to Collateral of such Grantor: (i) execute or authenticate
and file, or authorize the Collateral Agent to file, such financing or
continuation statements, or amendments thereto, and as permitted by the terms of
this Agreement or otherwise with the Grantor’s consent, such other instruments
or notices, as may be necessary or desirable, or as the Collateral Agent may
reasonably request, in order to perfect and preserve the security interest
granted or purported to be granted by such Grantor hereunder; (ii) upon the
occurrence and during the continuance of an Event of Default, take all action
necessary to ensure that the Collateral Agent has control of Collateral
consisting of investment property as provided in Section 9-106 of the UCC; and
(iii) deliver to the Collateral Agent evidence that all other actions that the
Collateral Agent may deem reasonably necessary or desirable in order to perfect
and protect the security interest granted or purported to be granted by such
Grantor under this Agreement has been taken. Notwithstanding anything to the
contrary set forth in this Section 5 or in this Agreement, unless an Event of
Default shall have occurred and be continuing, the Grantors shall not be
required to take any action to perfect the security interests granted under this
Agreement in any Collateral other than (A) executing, authenticating and filing,
or authorizing the Collateral Agent to file, financing or continuation
statements, or amendments thereto, and (B) delivering any certificated stock
certificates (and blank stock powers) representing the Pledged Equity.

 

(B)                                 EACH GRANTOR HEREBY AUTHORIZES THE
COLLATERAL AGENT TO FILE ONE OR MORE FINANCING OR CONTINUATION STATEMENTS, AND
AMENDMENTS THERETO, INCLUDING, WITHOUT LIMITATION, ONE OR MORE FINANCING
STATEMENTS INDICATING THAT SUCH FINANCING STATEMENTS COVER THE COLLATERAL LISTED
IN SECTION 1 OF THIS AGREEMENT OF SUCH GRANTOR, IN EACH CASE WITHOUT THE
SIGNATURE OF SUCH GRANTOR, AND REGARDLESS OF WHETHER ANY PARTICULAR ASSET
DESCRIBED IN SUCH FINANCING STATEMENTS FALLS WITHIN THE SCOPE OF THE UCC OR THE
GRANTING CLAUSE OF THIS AGREEMENT. A PHOTOCOPY OR OTHER REPRODUCTION OF THIS
AGREEMENT SHALL BE SUFFICIENT AS A FINANCING STATEMENT WHERE PERMITTED BY LAW.
EACH GRANTOR RATIFIES ITS AUTHORIZATION FOR THE COLLATERAL AGENT TO HAVE FILED
SUCH FINANCING STATEMENTS, CONTINUATION STATEMENTS OR AMENDMENTS FILED PRIOR TO
THE DATE HEREOF.

 

(C)                                  UPON THE OCCURRENCE AND CONTINUANCE OF AN
EVENT OF DEFAULT, UPON THE WRITTEN REQUEST OF THE COLLATERAL AGENT, EACH GRANTOR
WILL FURNISH TO THE COLLATERAL AGENT FROM TIME TO TIME STATEMENTS AND SCHEDULES
FURTHER IDENTIFYING AND DESCRIBING THE COLLATERAL OF SUCH GRANTOR AND SUCH OTHER
REPORTS IN CONNECTION WITH SUCH COLLATERAL AS THE COLLATERAL AGENT MAY
REASONABLY REQUEST, ALL IN REASONABLE DETAIL.

 

Section 6. Post-Closing Changes. (a)  No Grantor will change its name, type of
organization, jurisdiction of organization, organizational identification number
or location from those set forth in Section 4(a) of this Agreement without first
giving at least 15 days’ prior written notice to the Collateral Agent and taking
all action reasonably required by the Collateral Agent for the purpose of
perfecting or protecting the security interest granted by this Agreement. Each
Grantor will hold and preserve its records relating to the Collateral and will
permit representatives of the Collateral Agent at any reasonable time during
normal business hours upon reasonable advance notice to inspect and make
abstracts from such records and other documents. If any Grantor does not have an
organizational identification number and later obtains one, it will forthwith
notify the Collateral Agent of such organizational identification number.

 

Section 7. Voting Rights; Dividends; Etc. (a)  So long as no Event of Default
shall have occurred and be continuing:

 

(I)                                     EACH GRANTOR SHALL BE ENTITLED TO
EXERCISE ANY AND ALL VOTING AND OTHER CONSENSUAL RIGHTS PERTAINING TO THE
COLLATERAL OF SUCH GRANTOR OR ANY PART THEREOF FOR ANY PURPOSE.

 

(II)                                  EACH GRANTOR SHALL BE ENTITLED TO RECEIVE
AND RETAIN ANY AND ALL DIVIDENDS, INTEREST AND OTHER DISTRIBUTIONS PAID IN
RESPECT OF THE COLLATERAL OF SUCH GRANTOR IF AND TO THE EXTENT THAT THE PAYMENT
THEREOF IS NOT OTHERWISE PROHIBITED BY THE TERMS OF THE LOAN DOCUMENTS,
PROVIDED, HOWEVER, THAT ANY AND ALL DIVIDENDS AND OTHER DISTRIBUTIONS PAID OR
PAYABLE IN CASH IN

 

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RESPECT OF ANY COLLATERAL IN CONNECTION WITH A PARTIAL OR TOTAL LIQUIDATION OR
DISSOLUTION OR IN CONNECTION WITH A REDUCTION OF CAPITAL, CAPITAL SURPLUS OR
PAID-IN-SURPLUS SHALL BE RECEIVED IN TRUST FOR THE BENEFIT OF THE COLLATERAL
AGENT, BE SEGREGATED FROM THE OTHER PROPERTY OR FUNDS OF SUCH GRANTOR AND BE
FORTHWITH DELIVERED TO THE COLLATERAL AGENT AS COLLATERAL IN THE SAME FORM AS SO
RECEIVED (WITH ANY NECESSARY INDORSEMENT), TOGETHER WITH ANY INSTRUMENTS OR
CERTIFICATES EVIDENCING ALL RELATED COLLATERAL (WITH ANY NECESSARY INDORSEMENT).

 

(III)                               THE COLLATERAL AGENT WILL EXECUTE AND
DELIVER (OR CAUSE TO BE EXECUTED AND DELIVERED) TO EACH GRANTOR ALL SUCH PROXIES
AND OTHER INSTRUMENTS AS SUCH GRANTOR MAY REASONABLY REQUEST FOR THE PURPOSE OF
ENABLING SUCH GRANTOR TO EXERCISE THE VOTING AND OTHER RIGHTS THAT IT IS
ENTITLED TO EXERCISE PURSUANT TO PARAGRAPH (I) ABOVE AND TO RECEIVE THE
DIVIDENDS OR INTEREST PAYMENTS THAT IT IS AUTHORIZED TO RECEIVE AND RETAIN
PURSUANT TO PARAGRAPH (II) ABOVE.

 

(B)                                 UPON THE OCCURRENCE AND DURING THE
CONTINUANCE OF AN EVENT OF DEFAULT:

 

(I)                                     ALL RIGHTS OF EACH GRANTOR (X) TO
EXERCISE OR REFRAIN FROM EXERCISING THE VOTING AND OTHER CONSENSUAL RIGHTS THAT
IT WOULD OTHERWISE BE ENTITLED TO EXERCISE PURSUANT TO SECTION 7(A)(I) SHALL,
UPON FIVE BUSINESS DAYS’ NOTICE TO SUCH GRANTOR BY THE COLLATERAL AGENT, CEASE
AND (Y) TO RECEIVE THE DIVIDENDS, INTEREST AND OTHER DISTRIBUTIONS THAT IT WOULD
OTHERWISE BE AUTHORIZED TO RECEIVE AND RETAIN PURSUANT TO SECTION 7(A)(II) SHALL
AUTOMATICALLY CEASE, AND ALL SUCH RIGHTS SHALL THEREUPON BECOME VESTED IN THE
COLLATERAL AGENT, WHICH SHALL THEREUPON HAVE THE SOLE RIGHT TO EXERCISE OR
REFRAIN FROM EXERCISING SUCH VOTING AND OTHER CONSENSUAL RIGHTS AND TO RECEIVE
AND HOLD AS COLLATERAL SUCH DIVIDENDS, INTEREST AND OTHER DISTRIBUTIONS.

 

(II)                                  ALL DIVIDENDS, INTEREST AND OTHER
DISTRIBUTIONS THAT ARE RECEIVED BY ANY GRANTOR CONTRARY TO THE PROVISIONS OF
PARAGRAPH (I) OF THIS SECTION 7(B) SHALL BE RECEIVED IN TRUST FOR THE BENEFIT OF
THE COLLATERAL AGENT, SHALL BE SEGREGATED FROM OTHER FUNDS OF SUCH GRANTOR AND
SHALL BE FORTHWITH PAID OVER TO THE COLLATERAL AGENT AS COLLATERAL IN THE SAME
FORM AS SO RECEIVED (WITH ANY NECESSARY INDORSEMENT), TOGETHER WITH ANY
INSTRUMENTS OR CERTIFICATES EVIDENCING ALL RELATED COLLATERAL (WITH ANY
NECESSARY INDORSEMENT).

 

Section 8. Transfers and Other Liens; Additional Shares. Each Grantor agrees
that:

 

(A)                                  IT WILL NOT (I) SELL, ASSIGN OR OTHERWISE
DISPOSE OF, OR GRANT ANY OPTION WITH RESPECT TO, ANY OF THE COLLATERAL, OTHER
THAN SALES, ASSIGNMENTS AND OTHER DISPOSITIONS OF COLLATERAL, AND OPTIONS
RELATING TO COLLATERAL, PERMITTED UNDER THE TERMS OF THIS AGREEMENT OR THE LOAN
AGREEMENTS, OR (II) CREATE OR SUFFER TO EXIST ANY LIEN UPON OR WITH RESPECT TO
ANY OF THE COLLATERAL OF SUCH GRANTOR EXCEPT FOR THE PLEDGE, ASSIGNMENT AND
SECURITY INTEREST CREATED UNDER THIS AGREEMENT AND LIENS PERMITTED UNDER THE
LOAN AGREEMENTS.

 

(B)                                 IT WILL (I) CAUSE EACH ISSUER OF THE PLEDGED
EQUITY PLEDGED BY SUCH GRANTOR NOT TO ISSUE ANY EQUITY INTERESTS OR OTHER
SECURITIES IN ADDITION TO OR IN SUBSTITUTION FOR THE PLEDGED EQUITY ISSUED BY
SUCH ISSUER, EXCEPT TO SUCH GRANTOR OR EXCEPT AS PERMITTED BY THE LOAN
AGREEMENTS, AND (II) PLEDGE HEREUNDER, IMMEDIATELY UPON ITS ACQUISITION
(DIRECTLY OR INDIRECTLY) THEREOF, ANY AND ALL ADDITIONAL EQUITY INTERESTS OR
OTHER SECURITIES.

 

Section 9. Collateral Agent Appointed Attorney-in-Fact. Each Grantor hereby
irrevocably appoints the Collateral Agent such Grantor’s attorney-in-fact (such
appointment to cease upon the payment in full of all the Secured Obligations
other than contingent indemnification claims as to which no demand has been
made), with full authority in the place and stead of such Grantor and in the
name of such Grantor or otherwise, from time to time, upon the occurrence and
during the continuance of an Event of Default, in the Collateral Agent’s
reasonable discretion, to take any action and to execute any instrument that the
Collateral Agent may deem reasonably necessary or advisable to accomplish the
purposes of this Agreement, including, without limitation:

 

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(A)                                  TO ASK FOR, DEMAND, COLLECT, SUE FOR,
RECOVER, COMPROMISE, RECEIVE AND GIVE ACQUITTANCE AND RECEIPTS FOR MONEYS DUE
AND TO BECOME DUE UNDER OR IN RESPECT OF ANY OF THE COLLATERAL,

 

(B)                                 TO RECEIVE, INDORSE AND COLLECT ANY DRAFTS
OR OTHER INSTRUMENTS, DOCUMENTS AND CHATTEL PAPER, IN CONNECTION WITH
CLAUSE (A) OR (B) ABOVE, AND

 

(C)                                  TO FILE ANY CLAIMS OR TAKE ANY ACTION OR
INSTITUTE ANY PROCEEDINGS THAT THE COLLATERAL AGENT MAY DEEM NECESSARY OR
DESIRABLE FOR THE COLLECTION OF ANY OF THE COLLATERAL OR OTHERWISE TO ENFORCE
THE RIGHTS OF THE COLLATERAL AGENT WITH RESPECT TO ANY OF THE COLLATERAL.

 

Section 10. Collateral Agent May Perform. If any Grantor fails to perform any
agreement contained herein, the Collateral Agent may, as the Collateral Agent
deems necessary to protect the security interest granted hereunder in the
Collateral or to protect the value thereof, but without any obligation to do so
and without notice, itself perform, or cause performance of, such agreement, and
the expenses of the Collateral Agent incurred in connection therewith shall be
payable by such Grantor under Section 13.

 

Section 11. The Collateral Agent’s Duties. (a)  The powers conferred on the
Collateral Agent hereunder are solely to protect the Secured Parties’ interest
in the Collateral and shall not impose any fiduciary relationship or any duty
upon it to exercise any such powers. Except for the exercise of reasonable care
in the safe custody of any Collateral in its possession or in the possession of
an Affiliate of the Collateral Agent or any designee (including without
limitation, a Subagent (as defined in clause (b) below)) of the Collateral Agent
acting on its behalf and the accounting for moneys actually received by it or
its Affiliates hereunder in accordance with the express terms hereof, the
Collateral Agent shall have no fiduciary relationship or other duty as to any
Collateral, as to ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relative to any
Collateral, whether or not any Secured Party has or is deemed to have knowledge
of such matters, or as to the taking of any necessary steps to preserve rights
against any parties or any other rights pertaining to any Collateral. The
Collateral Agent and any of its Affiliates or any designee (including without
limitation, a Subagent) on its behalf shall be deemed to have exercised
reasonable care in the custody and preservation of any Collateral in its
possession or in the possession of an Affiliate or any designee (including
without limitation, a Subagent) on its behalf if such Collateral is accorded
treatment substantially equal to that which it accords its own property.

 

(B)                                 ANYTHING CONTAINED HEREIN TO THE CONTRARY
NOTWITHSTANDING, THE COLLATERAL AGENT MAY FROM TIME TO TIME, WHEN THE COLLATERAL
AGENT DEEMS IT TO BE NECESSARY, APPOINT ONE OR MORE SUBAGENTS (EACH A
“SUBAGENT”) FOR THE COLLATERAL AGENT HEREUNDER WITH RESPECT TO ALL OR ANY PART
OF THE COLLATERAL. IN THE EVENT THAT THE COLLATERAL AGENT SO APPOINTS ANY
SUBAGENT WITH RESPECT TO ANY COLLATERAL, (I) THE ASSIGNMENT AND PLEDGE OF SUCH
COLLATERAL AND THE SECURITY INTEREST GRANTED IN SUCH COLLATERAL BY EACH GRANTOR
HEREUNDER SHALL BE DEEMED FOR PURPOSES OF THIS SECURITY AGREEMENT A TO HAVE BEEN
MADE TO SUCH SUBAGENT, IN ADDITION TO THE COLLATERAL AGENT, FOR THE RATABLE
BENEFIT OF THE SECURED PARTIES, AS SECURITY FOR THE SECURED OBLIGATIONS OF SUCH
GRANTOR, (II) SUCH SUBAGENT SHALL AUTOMATICALLY BE VESTED, IN ADDITION TO THE
COLLATERAL AGENT, WITH ALL RIGHTS, POWERS, PRIVILEGES, INTERESTS AND REMEDIES OF
THE COLLATERAL AGENT HEREUNDER AND PURSUANT TO THE TERMS HEREOF, WITH RESPECT TO
SUCH COLLATERAL, AND (III) THE TERM “COLLATERAL AGENT,” WHEN USED HEREIN IN
RELATION TO ANY RIGHTS, POWERS, PRIVILEGES, INTERESTS AND REMEDIES OF THE
COLLATERAL AGENT WITH RESPECT TO SUCH COLLATERAL, SHALL INCLUDE SUCH SUBAGENT;
PROVIDED, HOWEVER, THAT NO SUCH SUBAGENT SHALL BE AUTHORIZED TO TAKE ANY ACTION
WITH RESPECT TO ANY SUCH COLLATERAL UNLESS AND EXCEPT TO THE EXTENT EXPRESSLY
AUTHORIZED IN WRITING BY THE COLLATERAL AGENT.

 

(C)                                  EACH SECURED PARTY BY ITS ACCEPTANCE
THEREOF HEREBY APPOINTS AND AUTHORIZES THE COLLATERAL AGENT TO TAKE SUCH ACTION
AS AGENT ON ITS BEHALF AND TO EXERCISE SUCH POWERS HEREUNDER AND UNDER THE OTHER
LOAN DOCUMENTS AS ARE SPECIFICALLY DELEGATED TO THE COLLATERAL AGENT BY THE
TERMS OF THIS AGREEMENT AND THE LOAN DOCUMENTS, TOGETHER WITH SUCH OTHER POWERS
AS ARE REASONABLY INCIDENTAL THERETO. THE COLLATERAL AGENT SHALL NOT HAVE ANY
DUTIES OR RESPONSIBILITIES EXCEPT THOSE EXPRESSLY SET FORTH IN THIS AGREEMENT
AND THE LOAN DOCUMENTS.

 

(D)                                 AS TO ANY MATTERS NOT EXPRESSLY PROVIDED FOR
BY THE LOAN DOCUMENTS, THE COLLATERAL AGENT SHALL NOT BE REQUIRED TO EXERCISE
ANY DISCRETION OR TAKE ANY ACTION, BUT SHALL BE REQUIRED TO ACT OR TO REFRAIN
FROM ACTING (AND SHALL BE FULLY PROTECTED IN SO ACTING OR REFRAINING FROM
ACTING) UPON THE WRITTEN INSTRUCTIONS SIGNED BY THE TERM LOAN ADMINISTRATIVE
AGENT AND THE REVOLVING LOAN ADMINISTRATIVE AGENT PROVIDED, HOWEVER, THAT THE
COLLATERAL AGENT SHALL NOT BE REQUIRED TO TAKE ANY ACTION THAT EXPOSES THE
COLLATERAL AGENT TO PERSONAL LIABILITY OR THAT

 

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IS CONTRARY TO THIS AGREEMENT OR APPLICABLE LAW. THE COLLATERAL AGENT SHALL IN
ALL CASES BE FULLY PROTECTED IN ACTING OR REFRAINING FROM ACTING UNDER THIS
AGREEMENT OR ANY OF THE LOAN DOCUMENTS UPON WRITTEN DIRECTIONS SIGNED BY THE
TERM LOAN ADMINISTRATIVE AGENT AND THE REVOLVING LOAN ADMINISTRATIVE AGENT,
EXCEPT FOR ANY SUCH ACTIONS (OR RESTRAINT OF ACTIONS) WHICH CONSTITUTE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT ON THE PART OF THE COLLATERAL AGENT. ANY SUCH
DIRECTIONS BY THE COLLATERAL AGENT AND ANY ACTION TAKEN BY THE COLLATERAL AGENT
AND ANY FAILURE BY THE COLLATERAL AGENT TO ACT, IN EACH CASE PURSUANT TO SUCH
DIRECTIONS, SHALL BE BINDING ON ALL THE SECURED PARTIES AND THEIR RESPECTIVE
SUCCESSORS AND ASSIGNS. THE COLLATERAL AGENT SHALL NOT BE RESPONSIBLE TO ANY
SECURED PARTY FOR ANY RECITALS, STATEMENTS, REPRESENTATIONS, OR WARRANTIES
(OTHER THAN ANY THEREOF MADE BY THE COLLATERAL AGENT OR ANY OFFICER THEREOF)
CONTAINED IN THIS AGREEMENT OR IN ANY OF THE LOAN DOCUMENTS, FOR THE VALUE,
VALIDITY, EFFECTIVENESS, GENUINENESS, ENFORCEABILITY, OR SUFFICIENCY OF THIS
AGREEMENT, OF ANY OF THE LOAN DOCUMENTS, OR OF THE COLLATERAL, OR FOR THE
CREATION, MAINTENANCE, PRIORITY OR PERFECTION OF ANY LIEN CREATED BY THE LOAN
DOCUMENTS.

 

(E)                                  SUBJECT TO THE PROVISIONS OF SECTION 11(D),
THE COLLATERAL AGENT MAY CONSULT WITH INDEPENDENT LEGAL COUNSEL AND THE ADVICE
OF SUCH COUNSEL SHALL BE FULL AND COMPLETE AUTHORIZATION AND PROTECTION IN
RESPECT OF ANY ACTION TO BE TAKEN, SUFFERED, OR OMITTED BY IT HEREUNDER IN GOOD
FAITH AND IN RELIANCE THEREON. THE COLLATERAL AGENT MAY EXECUTE ANY OF THE
RIGHTS OR POWERS HEREUNDER OR PERFORM ANY DUTIES HEREUNDER EITHER DIRECTLY OR
THROUGH OTHER AGENTS OR ATTORNEYS REASONABLY ACCEPTABLE TO THE REQUIRED LENDERS
UNDER EACH OF THE LOAN AGREEMENTS. THE COLLATERAL AGENT SHALL NOT BE LIABLE FOR
THE MISCONDUCT OR NEGLIGENCE OF ANY SUCH AGENT OR ATTORNEY APPOINTED BY IT WITH
DUE CARE. THE FOREGOING SHALL NOT EXCULPATE ANY SUCH AGENT OR ATTORNEY FROM
LIABILITY FOR ITS OWN MISCONDUCT OR NEGLIGENCE.

 

(F)                                    THE COLLATERAL AGENT, IN ITS INDIVIDUAL
CAPACITY AND ITS AFFILIATES MAY ACCEPT DEPOSITS FROM, LEND TO, AND GENERALLY
ENGAGE IN ANY KIND OF LENDING, BANKING, OR TRUST BUSINESS WITH, ANY GRANTOR OR
THEIR RESPECTIVE AFFILIATES AS IF IT WERE NOT ACTING AS THE COLLATERAL AGENT.
WITH RESPECT TO ITS COMMITMENT AND IN ITS CAPACITY AS A LENDER UNDER EACH OF THE
LOAN AGREEMENTS, THE COLLATERAL AGENT SHALL HAVE AND MAY EXERCISE THE SAME
RIGHTS AND POWERS UNDER THIS AGREEMENT AND IS SUBJECT TO THE SAME OBLIGATIONS
AND LIABILITIES AS APPLICABLE TO ANY OTHER LENDER.

 

(G)                                 TO THE EXTENT THAT GRANTORS FAIL TO DO SO
UNDER THE TERMS OF THE LOAN DOCUMENTS, AND WITHOUT LIMITING THE PRIMARY
OBLIGATION OF GRANTORS TO DO SO, THE SECURED PARTIES WILL REIMBURSE THE
COLLATERAL AGENT UPON DEMAND AND HOLD THE COLLATERAL AGENT, ITS DIRECTORS,
OFFICERS, EMPLOYEES, AND AGENTS HARMLESS AGAINST ANY AND ALL LOSSES,
LIABILITIES, OR EXPENSES INCURRED BY THE COLLATERAL AGENT ARISING OUT OF OR IN
CONNECTION WITH ANY ACTION TAKEN PURSUANT TO AND CONSISTENTLY WITH THE EXPRESS
WRITTEN DIRECTION OF THE APPLICABLE SECURED PARTIES GIVEN UNDER SECTION 11(D),
INCLUDING ANY COSTS AND EXPENSES INCURRED IN CONNECTION WITH ANY INVESTIGATION,
SUIT (WHETHER OR NOT THE COLLATERAL AGENT OR ANY OTHER SUCH INDEMNIFIED PERSON
IS NAMED AS A PARTY THERETO), OR CLAIM ARISING OUT OF OR RELATED TO SUCH ACTION,
IN PROPORTION TO THE RESPECTIVE PRINCIPAL AMOUNTS OF THE INDEBTEDNESS UNDER THE
LOAN AGREEMENTS AT THE TIME HELD BY THEM, PROVIDED, THAT NO SECURED PARTY SHALL
BE LIABLE UNDER THIS SECTION 11(G) FOR ANY SUCH LOSSES, LIABILITIES, OR EXPENSES
INCURRED BY THE COLLATERAL AGENT AS A RESULT OF ITS OWN BREACH OF THIS
AGREEMENT, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

 

(H)                                 THE COLLATERAL AGENT MAY RESIGN AT ANY TIME
BY GIVING AT LEAST FORTY-FIVE (45) DAYS’ PRIOR WRITTEN NOTICE OF RESIGNATION TO
GRANTORS AND EACH SECURED PARTY, SUCH RESIGNATION TO BE EFFECTIVE UPON THE
APPOINTMENT OF A SUCCESSOR COLLATERAL AGENT AS PROVIDED IN THIS SECTION 11. THE
COLLATERAL AGENT MAY BE REMOVED AT ANY TIME, FOR OR WITHOUT CAUSE, BY AN
INSTRUMENT OR INSTRUMENTS IN WRITING DELIVERED TO THE COLLATERAL AGENT AND
GRANTORS AND SIGNED BY THE REQUIRED LENDERS UNDER BOTH OF THE LOAN AGREEMENTS.
IN CASE THE OFFICE OF COLLATERAL AGENT SHALL BECOME VACANT FOR ANY REASON, A
SUCCESSOR COLLATERAL AGENT MAY BE APPOINTED TO FILL SUCH VACANCY BY AN
INSTRUMENT OR INSTRUMENTS IN WRITING DELIVERED TO SUCH SUCCESSOR COLLATERAL
AGENT, THE DEPARTING COLLATERAL AGENT, EACH LENDER UNDER ANY LOAN AGREEMENT AND
GRANTORS. AFTER ANY SUCH RESIGNATION OR REMOVAL, THE PROVISIONS OF THIS
SECTION 11 SHALL CONTINUE IN EFFECT FOR THE BENEFIT OF THE DEPARTING COLLATERAL
AGENT WITH RESPECT TO ANY ACTIONS TAKEN OR OMITTED BY IT WHILE ACTING AS
COLLATERAL AGENT.

 

(I)                                     ANY CORPORATION OR NATIONAL BANKING
ASSOCIATION INTO WHICH THE COLLATERAL AGENT MAY BE MERGED OR WITH WHICH IT MAY
BE CONSOLIDATED, OR ANY CORPORATION OR NATIONAL BANKING ASSOCIATION RESULTING
FROM ANY MERGER OR CONSOLIDATION TO WHICH THE COLLATERAL AGENT IS A PARTY, OR
ANY STATE OR NATIONAL BANK OR TRUST COMPANY IN ANY MANNER SUCCEEDING TO ALL OR
SUBSTANTIALLY ALL OF THE BUSINESS OF THE COLLATERAL AGENT AND SHALL
AUTOMATICALLY SUCCEED TO ALL OF THE RIGHTS AND OBLIGATIONS OF THE COLLATERAL
AGENT HEREUNDER AND UNDER THE LOAN DOCUMENTS WITHOUT

 

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FURTHER ACTION ON THE PART OF ANY OF THE PARTIES HERETO. SUCH SURVIVING OR
SUCCEEDING CORPORATION OR NATIONAL BANKING ASSOCIATION (IF OTHER THAN THE
COLLATERAL AGENT) SHALL FORTHWITH DELIVER TO EACH SECURED PARTY AND GRANTORS
WRITTEN NOTICE OF SUCH SUCCESSION TO THE RIGHTS AND OBLIGATIONS OF THE
COLLATERAL AGENT HEREUNDER AND UNDER THE LOAN DOCUMENTS.

 

Section 12. Remedies. If any Event of Default shall have occurred and be
continuing:

 

(A)                                  THE COLLATERAL AGENT MAY EXERCISE IN
RESPECT OF THE COLLATERAL, IN ADDITION TO OTHER RIGHTS AND REMEDIES PROVIDED FOR
HEREIN OR OTHERWISE AVAILABLE TO IT, ALL THE RIGHTS AND REMEDIES OF A SECURED
PARTY UPON DEFAULT UNDER THE UCC AND ALSO MAY: (I) WITHOUT NOTICE EXCEPT AS
SPECIFIED BELOW, SELL THE COLLATERAL OR ANY PART THEREOF IN ONE OR MORE PARCELS
AT PUBLIC OR PRIVATE SALE, AT ANY OF THE COLLATERAL AGENT’S OFFICES OR
ELSEWHERE, FOR CASH, ON CREDIT OR FOR FUTURE DELIVERY, AND UPON SUCH OTHER TERMS
AS THE COLLATERAL AGENT MAY IN ITS REASONABLE DISCRETION DEEM COMMERCIALLY
REASONABLE AND (II) EXERCISE ANY AND ALL RIGHTS AND REMEDIES OF ANY OF THE
GRANTORS UNDER OR IN CONNECTION WITH THE COLLATERAL, OR OTHERWISE IN RESPECT OF
THE COLLATERAL, INCLUDING, WITHOUT LIMITATION, (A) ANY AND ALL RIGHTS OF SUCH
GRANTOR TO DEMAND OR OTHERWISE REQUIRE PAYMENT OF ANY AMOUNT UNDER, OR
PERFORMANCE OF ANY PROVISION OF OR RELATED TO THE COLLATERAL AND (B) EXERCISE
ALL OTHER RIGHTS AND REMEDIES WITH RESPECT TO THE COLLATERAL, INCLUDING, WITHOUT
LIMITATION, THOSE SET FORTH IN SECTION 9-607 OF THE UCC. EACH GRANTOR AGREES
THAT, TO THE EXTENT NOTICE OF SALE SHALL BE REQUIRED BY LAW, AT LEAST TEN DAYS’
NOTICE TO SUCH GRANTOR OF THE TIME AND PLACE OF ANY PUBLIC SALE OR THREE DAYS’
NOTICE OF THE TIME AND PLACE OF ANY PRIVATE SALE SHALL CONSTITUTE REASONABLE
NOTIFICATION. THE COLLATERAL AGENT SHALL NOT BE OBLIGATED TO MAKE ANY SALE OF
COLLATERAL REGARDLESS OF NOTICE OF SALE HAVING BEEN GIVEN. THE COLLATERAL AGENT
MAY ADJOURN ANY PUBLIC OR PRIVATE SALE FROM TIME TO TIME BY ANNOUNCEMENT AT THE
TIME AND PLACE FIXED THEREFOR, AND SUCH SALE MAY, WITHOUT FURTHER NOTICE, BE
MADE AT THE TIME AND PLACE TO WHICH IT WAS SO ADJOURNED.

 

(B)                                 ANY CASH HELD BY OR ON BEHALF OF THE
COLLATERAL AGENT AND ALL CASH PROCEEDS RECEIVED BY OR ON BEHALF OF THE
COLLATERAL AGENT IN RESPECT OF ANY SALE OF, COLLECTION FROM, OR OTHER
REALIZATION UPON ALL OR ANY PART OF THE COLLATERAL SHALL BE HELD BY THE
COLLATERAL AGENT AS COLLATERAL FOR, AND/OR THEN OR AT ANY TIME THEREAFTER
APPLIED (AFTER PAYMENT OF ANY AMOUNTS PAYABLE TO THE COLLATERAL AGENT PURSUANT
TO SECTION 13) IN WHOLE OR IN PART BY THE COLLATERAL AGENT FOR THE BENEFIT OF
THE SECURED PARTIES AGAINST, ALL OR ANY PART OF THE SECURED OBLIGATIONS IN THE
FOLLOWING ORDER, (I) FIRST, ON A PARI PASSU BASIS, TO ALL SECURED OBLIGATIONS
(EXCLUDING SECURED OBLIGATIONS ARISING UNDER THE TERMS OF ANY CREDIT FACILITY
HEDGING AGREEMENTS), COMPARING (1) THE AGGREGATE PRINCIPAL AMOUNT OF THE THEN
OUTSTANDING TERM LOANS UNDER THE TERM LOAN AGREEMENT TO (2) THE AMOUNT OF THE
THEN EFFECTIVE AGGREGATE COMMITMENT (AS DEFINED IN THE REVOLVING LOAN
AGREEMENT), IF THE AGGREGATE COMMITMENT HAS NOT BEEN TERMINATED, OR THE SUM OF
THE AGGREGATE PRINCIPAL AMOUNT OF THE THEN OUTSTANDING REVOLVING LOANS UNDER THE
REVOLVING LOAN AGREEMENT AND THE LETTER OF CREDIT EXPOSURE AMOUNT (AS DEFINED IN
THE REVOLVING LOAN AGREEMENT) THEN OUTSTANDING UNDER THE REVOLVING LOAN
AGREEMENT, IF THE AGGREGATE COMMITMENT HAS BEEN TERMINATED; PROVIDED THAT THE
AMOUNTS SET FORTH IN THIS CLAUSE (I) THAT WILL BE GIVEN PARI PASSU TREATMENT AS
SET FORTH ABOVE SHALL BE LIMITED TO AMOUNTS (OF AGGREGATE COMMITMENTS AND LOANS
UNDER THE TERM LOAN AGREEMENT AND AGGREGATE COMMITMENTS OR LOANS AND LETTER OF
CREDIT EXPOSURE AMOUNT UNDER THE REVOLVING CREDIT AGREEMENT, OR AS APPLICABLE)
WHICH WOULD NOT GIVE RISE TO AN EVENT OF DEFAULT ARISING UNDER SECTION 7.1(D) OF
THE TERM LOAN AGREEMENT OR THE REVOLVING CREDIT AGREEMENT AS A RESULT OF A
BREACH OF SECTION 6.1(B) OF THE TERM LOAN AGREEMENT OR THE REVOLVING CREDIT
AGREEMENT, RESPECTIVELY AND (II) SECOND, ON A PARI PASSU BASIS, TO ALL SECURED
OBLIGATIONS ARISING UNDER THE TERMS OF ANY CREDIT FACILITY HEDGING AGREEMENTS).
ANY SURPLUS OF SUCH CASH OR CASH PROCEEDS HELD BY OR ON THE BEHALF OF THE
COLLATERAL AGENT AND REMAINING AFTER PAYMENT IN FULL OF ALL THE SECURED
OBLIGATIONS (OTHER THAN CONTINGENT INDEMNIFICATION CLAIMS AS TO WHICH NO DEMAND
HAS BEEN MADE) SHALL BE PAID OVER TO THE APPLICABLE GRANTOR OR TO WHOMSOEVER MAY
BE LAWFULLY ENTITLED TO RECEIVE SUCH SURPLUS.

 

(C)                                  ALL PAYMENTS RECEIVED BY ANY GRANTOR UNDER
OR IN RESPECT OF THE COLLATERAL SHALL BE RECEIVED IN TRUST FOR THE BENEFIT OF
THE COLLATERAL AGENT, SHALL BE SEGREGATED FROM OTHER FUNDS OF SUCH GRANTOR AND
SHALL BE FORTHWITH PAID OVER TO THE COLLATERAL AGENT IN THE SAME FORM AS SO
RECEIVED (WITH ANY NECESSARY INDORSEMENT).

 

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

 

 

(D)                                 THE COLLATERAL AGENT IS AUTHORIZED, IN
CONNECTION WITH ANY SALE OF THE COLLATERAL PURSUANT TO THIS SECTION 12, TO
DELIVER OR OTHERWISE DISCLOSE TO ANY PROSPECTIVE PURCHASER OF THE COLLATERAL ANY
INFORMATION IN ITS POSSESSION RELATING TO SUCH COLLATERAL.

 

Section 13. Indemnity and Expenses.  (a)  Each Grantor agrees to indemnify,
defend and save and hold harmless each Secured Party and each of their
Affiliates and their respective officers, directors, employees, agents and
advisors (each, an “Indemnified Party”) from and against, and shall pay on
demand, any and all actual claims, damages, losses, liabilities and
out-of-pocket expenses (including, without limitation, reasonable fees and
expenses of counsel but excluding special, indirect, punitive or consequential
damages, whether arising in tort, contract or otherwise) that may be incurred by
or asserted or awarded against any Indemnified Party, in each case arising out
of or in connection with or by reason of (including, without limitation, in
connection with any investigation, litigation or proceeding or preparation of a
defense in connection therewith) this Agreement, except to the extent such
claim, damage, loss, liability or expense is found in a final nonappealable
judgment by a court of competent jurisdiction to have resulted from such
Indemnified Party’s gross negligence or willful misconduct.  In the case of an
investigation, litigation or other proceeding to which the indemnity in this
Section 13(a) applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by any Grantor, its
directors, shareholders or creditors or any Indemnified Party or any other
Person, whether or not any Indemnified Party is otherwise a party thereto and
whether or not the Merger is consummated.  The Grantors also agree not to assert
any claim against the Collateral Agent, any Secured Party or any of their
Affiliates, or any of their respective officers, directors, employees, agents
and advisors, on any theory of liability, for special, indirect, consequential
or punitive damages arising out of or otherwise relating to the this Agreement.

 

(B)                                 EACH GRANTOR AGREES TO PAY ON DEMAND (I) ALL
REASONABLE OUT-OF-POCKET COSTS AND EXPENSES OF THE COLLATERAL AGENT IN
CONNECTION WITH THE PREPARATION, EXECUTION, DELIVERY, ADMINISTRATION,
MODIFICATION AND AMENDMENT OF, OR ANY CONSENT OR WAIVER UNDER, THIS AGREEMENT
(INCLUDING, WITHOUT LIMITATION, THE REASONABLE OUT-OF-POCKET FEES AND EXPENSES
OF COUNSEL FOR THE COLLATERAL AGENT WITH RESPECT THERETO, WITH RESPECT TO
ADVISING THE COLLATERAL AGENT AS TO ITS RIGHTS AND RESPONSIBILITIES, OR THE
PERFECTION, PROTECTION OR PRESERVATION OF RIGHTS OR INTERESTS, UNDER THIS
AGREEMENT, WITH RESPECT TO NEGOTIATIONS WITH ANY GRANTOR OR WITH OTHER CREDITORS
OF ANY GRANTOR OR ANY OF ITS SUBSIDIARIES ARISING OUT OF ANY DEFAULT OR ANY
EVENTS OR CIRCUMSTANCES THAT MAY GIVE RISE TO A DEFAULT AND WITH RESPECT TO
PRESENTING CLAIMS IN OR OTHERWISE PARTICIPATING IN OR MONITORING ANY BANKRUPTCY,
INSOLVENCY OR OTHER SIMILAR PROCEEDING INVOLVING CREDITORS’ RIGHTS GENERALLY AND
ANY PROCEEDING ANCILLARY THERETO) AND (II) ALL COSTS AND EXPENSES OF THE
COLLATERAL AGENT AND EACH SECURED PARTY IN CONNECTION WITH THE ENFORCEMENT OF
THIS AGREEMENT, WHETHER IN ANY ACTION, SUIT OR LITIGATION, OR ANY BANKRUPTCY,
INSOLVENCY OR OTHER SIMILAR PROCEEDING AFFECTING CREDITORS’ RIGHTS GENERALLY
(INCLUDING, WITHOUT LIMITATION, THE REASONABLE FEES AND EXPENSES OF COUNSEL FOR
THE COLLATERAL AGENT AND EACH SECURED PARTY WITH RESPECT THERETO).

 

Section 14. Amendments; Waivers; Additional Grantors; Etc.  (a)  No amendment or
waiver of any provision of this Agreement, and no consent to any departure by
any Grantor herefrom, shall in any event be effective unless the same shall be
in writing and signed by the Collateral Agent, the Term Loan Administrative
Agent and the Revolving Loan Administrative Agent and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.  No failure on the part of the Collateral Agent or any
other Secured Party to exercise, and no delay in exercising any right hereunder,
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right preclude any other or further exercise thereof or the exercise of
any other right.

 

(B)                                 UPON THE EXECUTION AND DELIVERY BY ANY
PERSON OF A SECURITY AGREEMENT SUPPLEMENT IN SUBSTANTIALLY THE FORM OF EXHIBIT A
HERETO (EACH A “SECURITY AGREEMENT A SUPPLEMENT”), SUCH PERSON SHALL BE REFERRED
TO AS AN “ADDITIONAL GRANTOR” AND SHALL BE AND BECOME A GRANTOR HEREUNDER, AND
EACH REFERENCE IN THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS TO “GRANTOR” SHALL
ALSO MEAN AND BE A REFERENCE TO SUCH ADDITIONAL GRANTOR, EACH REFERENCE IN THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS TO THE “COLLATERAL” SHALL ALSO MEAN AND
BE A REFERENCE TO THE COLLATERAL GRANTED BY SUCH ADDITIONAL GRANTOR AND EACH
REFERENCE IN THIS AGREEMENT TO A SCHEDULE SHALL ALSO MEAN AND BE A REFERENCE TO
THE SCHEDULES ATTACHED TO SUCH SECURITY AGREEMENT A SUPPLEMENT.

 

Section 15. Notices, Etc.  All notices and other communications provided for
hereunder shall be in writing (including telecopier) and mailed, telecopied or
otherwise delivered, in the case of the Borrower or the Collateral Agent,
addressed to it at its address specified in the Loan Agreements and, in the case
of each Grantor

 

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

 

other than the Borrower, addressed to it at its address set forth opposite such
Grantor’s name on the signature pages hereto or on the signature page to the
Security Agreement A Supplement pursuant to which it became a party hereto; or,
as to any party, at such other address as shall be designated by such party in a
written notice to the other parties.  All such notices and other communications
shall, when mailed, telegraphed or telecopied, be effective when deposited in
the mails, delivered to the telegraph company or transmitted by telecopier,
respectively.  Delivery by telecopier of an executed counterpart of a signature
page to any amendment or waiver of any provision of this Agreement of any
Exhibit hereto to be executed and delivered hereunder shall be effective as
delivery of an original executed counterpart thereof.  As agreed to among the
Borrower, the Collateral Agent and the applicable Secured Parties from time to
time, notices and other communications may also be delivered by e-mail to the
e-mail address of a representative of the applicable Person provided from time
to time by such Person.

 

Section 16. Continuing Security Interest; Assignments under the Loan
Agreements.  This Agreement shall create a continuing security interest in the
Collateral and shall (a) remain in full force and effect until the payment in
full in cash of the Secured Obligations (other than contingent indemnification
obligations as to which no demand has been made), (b) be binding upon each
Grantor, its successors and assigns and (c) inure, together with the rights and
remedies of the Collateral Agent hereunder, to the benefit of the Secured
Parties and their respective successors, transferees and assigns.  Without
limiting the generality of the foregoing clause (c), any Lender may assign or
otherwise transfer all or any portion of its rights and obligations under the
applicable Loan Agreement(s) (including, without limitation, all or any portion
of the Loans owing to it and the Note or Notes, if any, held by it) to any other
Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Lender herein or otherwise.

 

Section 17. Release; Termination.  (a)  Upon any sale, lease, transfer or other
disposition of any item of Collateral of any Grantor in accordance with the
terms of the Loan Documents, the Collateral Agent will, at such Grantor’s
expense, execute and deliver to such Grantor such documents as such Grantor
shall reasonably request to evidence the release of such item of Collateral from
the assignment and security interest granted hereby; provided, however, that
(i) at the time of such request and such release no Event of Default shall have
occurred and be continuing, (ii) such Grantor shall have delivered to the
Collateral Agent, prior to the date of the proposed release, a written request
for release describing the item of Collateral, together with a form of release
for execution by the Collateral Agent and a certificate of such Grantor to the
effect that the transaction is in compliance with the Loan Documents and as to
such other matters as the Collateral Agent may reasonably request and (iii) the
proceeds of any such sale, lease, transfer or other disposition required to be
applied, or any payment to be made in connection therewith, in accordance with
the terms of this Agreement.

 

(B)                                 UPON THE PAYMENT IN FULL IN CASH OF THE
SECURED OBLIGATIONS (OTHER THAN CONTINGENT INDEMNIFICATION OBLIGATIONS AS TO
WHICH NO DEMAND HAS BEEN MADE), AND THE TERMINATION OF THE AGGREGATE COMMITMENT
(AS DEFINED IN EACH OF THE LOAN AGREEMENTS), THE PLEDGE AND SECURITY INTEREST
GRANTED HEREBY SHALL TERMINATE AND ALL RIGHTS TO THE COLLATERAL SHALL REVERT TO
THE APPLICABLE GRANTOR.  UPON ANY SUCH TERMINATION, THE COLLATERAL AGENT WILL,
AT THE APPLICABLE GRANTOR’S EXPENSE, EXECUTE AND DELIVER TO SUCH GRANTOR SUCH
DOCUMENTS AS SUCH GRANTOR SHALL REASONABLY REQUEST TO EVIDENCE SUCH TERMINATION.

 

Section 18. Execution in Counterparts.  This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.  Delivery of
an executed signature page of this Agreement by facsimile transmission or
electronic transmission (i.e., a “pdf” or “tif”) shall be effective as delivery
of an original executed counterpart of this Agreement.

 

Section 19. Jurisdiction; Governing Law; Etc.  (a) Each of the parties hereto
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or Federal court of
the United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement or any of the other Loan Documents to which it is a party, 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 any such New York State
court or, to the fullest extent permitted by law, in such Federal court.  Each
of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law.  Nothing in this
Agreement

 

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

 

shall affect any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement or any of the other Loan Documents in the
courts of any jurisdiction.

 

(B)                                 EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO
SO, ANY OBJECTION THAT 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 OF THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY IN ANY NEW YORK STATE OR
FEDERAL COURT.  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.

 

(C)                                  THIS AGREEMENT AND THE NOTES SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.

 

(d)                                 EACH OF THE GRANTORS AND THE COLLATERAL
AGENT IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO ANY OF THE LOAN DOCUMENTS, THE LOANS OR THE ACTIONS OF THE AGENT OR
ANY LENDER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT
THEREOF.

 

[Rest of this page intentionally left blank.]

 

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IN WITNESS WHEREOF, each of the undersigned have caused this Agreement to be
duly executed and delivered by its officer thereunto duly authorized as of the
date first above written.

 

 

JPMORGAN CHASE BANK, N.A., AS

 

 

COLLATERAL AGENT

 

By:

 

 

 

Name:

 

 

Title:

 

 

WHOLE FOODS MARKET, INC.

 

By:

 

 

 

Name:

 

 

Title:

Address for Notices:

[OTHER GRANTORS]

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

Whole Foods Market, Inc.– Security Agreement B

 

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Schedule I to the

Security Agreement A

 

PLEDGED INTERESTS AND PLEDGED DEBT

 

Part I

 

 Initial Pledged Interests

 

 

Grantor

 

Issuer

 

Class of Equity
Interest

 

Par Value

 

Certificate
No(s)

 

Number
of Shares

 

Percentage
of
Outstanding
Shares of the Same Class of Equity Interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Part II

 

Initial Pledged Debt

 

Grantor

 

Debt
Issuer

 

Description of
Debt

 

Debt Certificate No(s).

 

Final
Scheduled
Maturity

 

Outstanding
Principal
Amount

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Schedule II to the

Security Agreement A

 

LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF ORGANIZATION, JURISDICTION OF
ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER

 

Grantor

 

Location

 

Chief
Executive
Office

 

Type of
Organization

 

Jurisdiction
of
Organization

 

Organizational
I.D. No.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Schedule III to the

Security Agreement A

 

CHANGES IN NAME, LOCATION, ETC.

 

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Exhibit A to the

Security Agreement A

 

FORM OF SECURITY AGREEMENT SUPPLEMENT

 

[Date of Security Agreement A Supplement]

 

JPMORGAN CHASE BANK, N.A.,

as the Collateral Agent for the

Secured Parties referred to in the

Loan Agreements referred to below

                                        

                                        

Attn:                           

 

WHOLE FOODS MARKET, INC.

 

Ladies and Gentlemen:

 

Reference is made to (i) the Term Loan Agreement dated as of August [ ], 2007
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the “Term Loan Agreement”), among the Borrower, Royal Bank of Canada,
as administrative agent for the lenders from time to time parties thereto,
JPMorgan Chase Bank, N.A., and                as [joint] syndication agent[s],
                     as documentation agent,                       as managing
agent and RBC Capital Markets and J. P. Morgan Securities Inc., as joint lead
arrangers and joint bookrunners (ii)  the Revolving Credit Loan Agreement dated
as of August [ ], 2007 (as amended, amended and restated, supplemented or
otherwise modified from time to time, the “Revolving Loan Agreement”), among the
Borrower, JPMorgan Chase Bank, N.A., as administrative agent for the lenders
from time to time parties thereto, Royal Bank of Canada, as syndication agents,
and J. P. Morgan Securities Inc. and RBC Capital Markets, as joint lead
arrangers and joint bookrunners, and (iii) the Security Agreement A dated
[                           ], 2007 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the “Security Agreement
A”) made by the Grantors from time to time party thereto in favor of JPMorgan
Chase Bank, N.A. as collateral agent (together with any successor collateral
agent, the “Collateral Agent”) for the Secured Parties under the Term Loan
Agreement and the Revolving Loan Agreement (the Term Loan Agreement and the
Revolving Loan Agreement being sometimes hereinafter collectively referred to as
the “Loan Agreements”). Terms defined in the Loan Agreements or the Security
Agreement A and not otherwise defined herein are used herein as defined in the
Loan Agreements or the Security Agreement A.

 

SECTION 1. Grant of Security. The undersigned hereby grants to the Collateral
Agent, for the ratable benefit of the Secured Parties under the Loan Documents,
a security interest in, all of its right, title and interest in and to all of
the Collateral of the undersigned, whether now owned or hereafter acquired by
the undersigned, wherever located and whether now or hereafter existing or
arising, including, without limitation, the property and assets of the
undersigned set forth on the attached supplemental schedules to the Schedules to
the Security Agreement A.

 

SECTION 2. Security for Obligations. The grant of a security interest in the
Collateral by the undersigned under this Security Agreement A Supplement and the
Security Agreement A secures the payment of all Indebtedness and other
obligations of the undersigned now or hereafter existing under or in respect of
the Loan Documents, whether direct or indirect, absolute or contingent, and
whether for principal, reimbursement obligations, interest, premiums, penalties,
fees, indemnifications, contract causes of action, costs, expenses or otherwise.
Without limiting the generality of the foregoing, this Security Agreement A
Supplement and the Security Agreement A secure the payment of all amounts that
constitute part of the Secured Obligations and that would be owed by the
undersigned to any Secured Party under the Loan Documents but for the fact that
such Secured Obligations are

 

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unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving a Loan Party.

 

SECTION 3. Supplements to Security Agreement A Schedules. The undersigned has
attached hereto supplemental Schedules I through III to Schedules I through III,
respectively, to the Security Agreement A, and the undersigned hereby certifies,
as of the date first above written, that such supplemental schedules have been
prepared by the undersigned in substantially the form of the equivalent
Schedules to the Security Agreement A and are complete and correct.

 

SECTION 4. Representations and Warranties. The undersigned hereby makes each
representation and warranty set forth in Section 4 of the Security Agreement A
(as supplemented by the attached supplemental schedules) to the same extent as
each other Grantor.

 

SECTION 5. Obligations Under the Security Agreement A. The undersigned hereby
agrees, as of the date first above written, to be bound as a Grantor by all of
the terms and provisions of the Security Agreement A to the same extent as each
of the other Grantors. The undersigned further agrees, as of the date first
above written, that each reference in the Security Agreement A to an “Additional
Grantor” or a “Grantor” shall also mean and be a reference to the undersigned.

 

SECTION 6. Governing Law. This Security Agreement A Supplement shall be governed
by, and construed in accordance with, the laws of the State of New York.

 

 

Very truly yours,

 

 

 

[NAME OF ADDITIONAL GRANTOR]

 

 

 

 

 

By

 

 

 

Name:

 

 

Title:

 

 

 

 

Address for notices:

 

 

 

 

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EXHIBIT G-B

 

FORM OF

SECURITY AGREEMENT B

 

(See Attached)

 

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SECURITY AGREEMENT B

 

Dated [                           ], 2007

 

From

 

WHOLE FOODS MARKET, INC.,

 

as Grantor

 

- and -

 

the other Grantors referred to herein

 

as Grantors

 

to

 

JPMORGAN CHASE BANK, N.A.

 

as Collateral Agent

 

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T A B L E  O F  C O N T E N T S

 

Section

 

Page

 

 

 

Section 1. Grant of Security

 

2

 

 

 

Section 2. Security for Obligations; Interpretation

 

4

 

 

 

Section 3. Grantors Remain Liable

 

4

 

 

 

Section 4. Representations and Warranties

 

4

 

 

 

Section 5. Further Assurances

 

5

 

 

 

Section 6. As to Equipment and Inventory

 

5

 

 

 

Section 7. Insurance

 

6

 

 

 

Section 8. Post-Closing Changes; Collections on Receivables and Related
Contracts

 

6

 

 

 

Section 9. As to Intellectual Property Collateral

 

6

 

 

 

Section 10. As to Letter-of-Credit Rights

 

6

 

 

 

Section 11. Commercial Tort Claims

 

7

 

 

 

Section 12. Transfers and Other Liens; Additional Shares

 

7

 

 

 

Section 13. Collateral Agent Appointed Attorney-in-Fact

 

7

 

 

 

Section 14. Collateral Agent May Perform

 

7

 

 

 

Section 15. The Collateral Agent’s Duties

 

7

 

 

 

Section 16. Remedies

 

9

 

 

 

Section 17. Indemnity and Expenses

 

10

 

 

 

Section 18. Amendments; Waivers; Additional Grantors; Etc.

 

11

 

 

 

Section 19. Notices, Etc.

 

11

 

 

 

Section 20. Continuing Security Interest; Assignments under the Loan Agreements

 

12

 

 

 

Section 21. Release; Termination

 

12

 

 

 

Section 22. Execution in Counterparts

 

12

 

 

 

Section 23. Jurisdiction; Governing Law, Etc

 

12

 

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SCHEDULES

 

Schedule I

-

Location, Chief Executive Office, Place Where Agreements Are Maintained, Type Of
Organization, Jurisdiction Of Organization And Organizational Identification
Number

Schedule II

-

Changes in Name, Location, Etc.

 

 

 

EXHIBIT

 

 

 

 

 

Exhibit A

-

Form of Security Agreement B Supplement

 

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SECURITY AGREEMENT B

 

SECURITY AGREEMENT dated [                         ], 20     made by WHOLE FOODS
MARKET, INC., a Texas corporation (the “Borrower”), and the other Persons listed
on the signature pages hereof (the Borrower and the Persons so listed being,
collectively, the “Grantors”), to JPMORGAN CHASE BANK, N.A. (“JPMorgan”), as
collateral agent (in such capacity, and together with any successor collateral
agent appointed pursuant to this Agreement, the “Collateral Agent”) for the
Secured Parties (as defined below).

 

PRELIMINARY STATEMENTS.

 

6.                                       The Borrower has entered into a Term
Loan Agreement dated as of August [  ], 2007 among the Borrower, Royal Bank of
Canada, as administrative agent for the lenders from time to time parties
thereto (together with its successors and assigns in such capacity, the “Term
Loan Administrative Agent”), JPMorgan Chase Bank, N.A., as Collateral Agent and
as syndication agent, and RBC Capital Markets and J. P. Morgan Securities Inc.,
as joint lead arrangers and joint bookrunners (said agreement, as it may
hereafter be amended, restated, supplemented or otherwise modified from time to
time, being the “Term Loan Agreement”).

 

7.                                       The Borrower has entered into a
Revolving Credit Agreement dated as of August [  ], 2007 among the Borrower,
JPMorgan Chase Bank, N.A., as Collateral Agent and as administrative agent for
the lenders from time to time parties thereto (together with its successors and
assigns in such capacity, the “Revolving Loan Administrative Agent”), Royal Bank
of Canada,, as syndication agent, and J. P. Morgan Securities Inc. and RBC
Capital Markets, as joint lead arrangers and joint bookrunners (said agreement,
as it may hereafter be amended, restated, supplemented or otherwise modified
from time to time, being the “Revolving Loan Agreement”).  The Term Loan
Agreement and the Revolving Loan Agreement shall sometimes hereinafter be
collectively referred to as the “Loan Agreements.”

 

8.                                       In connection with the Term Loan
Agreement, certain of the Grantors (other than the Borrower) and other
affiliated entities have executed and delivered a Master Guaranty Agreement to
the Term Loan Administrative Agent dated as of August [  ], 2007, and in
connection with the Revolving Loan Agreement, the Grantors (other than the
Borrower) and other affiliated entities have executed and delivered a Master
Guaranty Agreement to the Revolving Loan Administrative Agent dated as of
August [  ], 2007 (both of said Master Guaranty Agreements, as each of the same
may hereafter be amended, restated, supplemented or otherwise modified from time
to time, being the “Master Guaranty Agreements”).

 

9.                                       In connection with the Loan Agreements,
the Grantors have executed and delivered a Security Agreement A to the
Collateral Agent dated as of August [  ], 2007 (said agreement, as it may
hereafter be amended, restated, supplemented or otherwise modified from time to
time, being the “Security Agreement A”), with the understanding that this
Agreement and the security interest granted hereunder is in addition to, and not
in lieu of, Security Agreement A.

 

10.                                 Pursuant to Section 5.17 of the Term Loan
Agreement and/or Section 5.17 of the Revolving Loan Agreement, either or both of
the Term Loan Administrative Agent and/or the Revolving Loan Administrative
Agent have requested that the Grantors grant the security interest contemplated
by this Agreement.  Each Grantor will derive substantial direct and indirect
benefit from the transactions contemplated by the Loan Agreements.

 

11.                                 Upon the request of the Collateral Agent in
connection with the exercise of its remedies hereunder, the Borrower will open a
collateral deposit account (the “Collateral Account”) pursuant to, and subject
to the terms of, this Agreement.

 

12.                                 Terms defined in the Loan Agreements and not
otherwise defined in this Agreement are used in this Agreement as defined in the
Loan Agreements.  Further, unless otherwise defined in this Agreement or in the
Loan Agreements, terms defined in Article 8 or 9 of the UCC (as

 

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defined below) are used in this Agreement as such terms are defined in such
Article 8 or 9.  “UCC” means the Uniform Commercial Code as in effect from time
to time in the State of New York; provided that, if perfection or the effect of
perfection or non-perfection or the priority of the security interest in any
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, “UCC” means the Uniform
Commercial Code as in effect from time to time in such other jurisdiction for
purposes of the provisions hereof relating to such perfection, effect of
perfection or non-perfection or priority.

 

NOW, THEREFORE, in consideration of the premises, each Grantor hereby agrees
with the Collateral Agent for the ratable benefit of the Secured Parties under
each of the Loan Agreements as follows:

 

Section 1.  Grant of Security.  Each Grantor hereby grants to the Collateral
Agent, for the ratable benefit of the lenders from time to time party to either
or both of the Loan Agreements (together with the Collateral Agent, the Term
Loan Administrative Agent and the Revolving Loan Administrative Agent, the
“Secured Parties”) , a security interest in such Grantor’s right, title and
interest in and to the following, in each case, as to each type of property
described below, whether now owned or hereafter acquired by such Grantor,
wherever located, and whether now or hereafter existing or arising
(collectively, the “Additional Collateral”):

 

(A)                                  ALL EQUIPMENT IN ALL OF ITS FORMS,
INCLUDING, WITHOUT LIMITATION, ALL MACHINERY, TOOLS, FURNITURE AND FIXTURES, AND
ALL PARTS THEREOF AND ALL ACCESSIONS THERETO, INCLUDING, WITHOUT LIMITATION,
COMPUTER PROGRAMS AND SUPPORTING INFORMATION THAT CONSTITUTE EQUIPMENT WITHIN
THE MEANING OF THE UCC (ANY AND ALL SUCH PROPERTY BEING THE “EQUIPMENT”);

 

(B)                                 ALL INVENTORY IN ALL OF ITS FORMS,
INCLUDING, WITHOUT LIMITATION, (I) ALL RAW MATERIALS, WORK IN PROCESS, FINISHED
GOODS AND MATERIALS USED OR CONSUMED IN THE MANUFACTURE, PRODUCTION, PREPARATION
OR SHIPPING THEREOF, (II) GOODS IN WHICH SUCH GRANTOR HAS AN INTEREST IN MASS OR
A JOINT OR OTHER INTEREST OR RIGHT OF ANY KIND (INCLUDING, WITHOUT LIMITATION,
GOODS IN WHICH SUCH GRANTOR HAS AN INTEREST OR RIGHT AS CONSIGNEE) AND
(III) GOODS THAT ARE RETURNED TO OR REPOSSESSED OR STOPPED IN TRANSIT BY SUCH
GRANTOR, AND ALL ACCESSIONS THERETO AND PRODUCTS THEREOF AND DOCUMENTS THEREFOR,
INCLUDING, WITHOUT LIMITATION, COMPUTER PROGRAMS AND SUPPORTING INFORMATION THAT
CONSTITUTE INVENTORY WITHIN THE MEANING OF THE UCC (ANY AND ALL SUCH PROPERTY
BEING THE “INVENTORY”);

 

(C)                                  ALL ACCOUNTS, CHATTEL PAPER (INCLUDING,
WITHOUT LIMITATION, TANGIBLE CHATTEL PAPER AND ELECTRONIC CHATTEL PAPER),
INSTRUMENTS (INCLUDING, WITHOUT LIMITATION, PROMISSORY NOTES), DEPOSIT ACCOUNTS,
LETTER-OF-CREDIT RIGHTS, GENERAL INTANGIBLES (INCLUDING, WITHOUT LIMITATION,
PAYMENT INTANGIBLES) AND OTHER OBLIGATIONS OF ANY KIND, WHETHER OR NOT ARISING
OUT OF OR IN CONNECTION WITH THE SALE OR LEASE OF GOODS OR THE RENDERING OF
SERVICES AND WHETHER OR NOT EARNED BY PERFORMANCE, AND ALL RIGHTS NOW OR
HEREAFTER EXISTING IN AND TO ALL SUPPORTING OBLIGATIONS AND IN AND TO ALL
SECURITY AGREEMENTS, MORTGAGES, LIENS, LEASES, LETTERS OF CREDIT AND OTHER
CONTRACTS SECURING OR OTHERWISE RELATING TO THE FOREGOING PROPERTY (ANY AND ALL
OF SUCH ACCOUNTS, CHATTEL PAPER, INSTRUMENTS, DEPOSIT ACCOUNTS, LETTER-OF-CREDIT
RIGHTS, GENERAL INTANGIBLES AND OTHER OBLIGATIONS, TO THE EXTENT NOT REFERRED TO
IN CLAUSE (D), (E) OR (F) BELOW, BEING THE “RECEIVABLES,” AND ANY AND ALL SUCH
SUPPORTING OBLIGATIONS, SECURITY AGREEMENTS, MORTGAGES, LIENS, LEASES, LETTERS
OF CREDIT AND OTHER CONTRACTS BEING THE “RELATED CONTRACTS”);

 

(D)                                 THE FOLLOWING (COLLECTIVELY, THE “ACCOUNT
COLLATERAL”):

 

(I)                                     THE COLLATERAL ACCOUNT AND EACH OTHER
DEPOSIT ACCOUNT AND ALL FUNDS AND FINANCIAL ASSETS FROM TIME TO TIME CREDITED
THERETO (INCLUDING, WITHOUT LIMITATION, ALL CASH EQUIVALENTS), AND ALL
CERTIFICATES AND INSTRUMENTS, IF ANY, FROM TIME TO TIME REPRESENTING OR
EVIDENCING THE COLLATERAL ACCOUNT OR SUCH OTHER DEPOSIT ACCOUNT;

 

(II)                                  ALL PROMISSORY NOTES, CERTIFICATES OF
DEPOSIT, CHECKS AND OTHER INSTRUMENTS FROM TIME TO TIME DELIVERED TO OR
OTHERWISE POSSESSED BY THE COLLATERAL AGENT OR AN AFFILIATE OF THE COLLATERAL
AGENT ON ITS BEHALF, FOR OR ON BEHALF OF SUCH GRANTOR IN SUBSTITUTION FOR OR IN
ADDITION TO ANY OR ALL OF THE THEN EXISTING ACCOUNT COLLATERAL; AND

 

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(III)                               ALL INTEREST, DIVIDENDS, DISTRIBUTIONS,
CASH, INSTRUMENTS AND OTHER PROPERTY FROM TIME TO TIME RECEIVED, RECEIVABLE OR
OTHERWISE DISTRIBUTED IN RESPECT OF OR IN EXCHANGE FOR ANY OR ALL OF THE THEN
EXISTING ACCOUNT COLLATERAL;

 

(E)                                  THE FOLLOWING (COLLECTIVELY, THE
“INTELLECTUAL PROPERTY COLLATERAL”):

 

(I)                                     ALL PATENTS, PATENT APPLICATIONS,
UTILITY MODELS AND STATUTORY INVENTION REGISTRATIONS, ALL INVENTIONS CLAIMED OR
DISCLOSED THEREIN AND ALL IMPROVEMENTS THERETO;

 

(II)                                  ALL TRADEMARKS, SERVICE MARKS, DOMAIN
NAMES, TRADE DRESS, LOGOS, DESIGNS, SLOGANS, TRADE NAMES, BUSINESS NAMES,
CORPORATE NAMES AND OTHER SOURCE IDENTIFIERS, WHETHER REGISTERED OR UNREGISTERED
(PROVIDED THAT NO SECURITY INTEREST SHALL BE GRANTED IN UNITED STATES
INTENT-TO-USE TRADEMARK APPLICATIONS TO THE EXTENT THAT, AND SOLELY DURING THE
PERIOD IN WHICH, THE GRANT OF A SECURITY INTEREST THEREIN WOULD IMPAIR THE
VALIDITY OR ENFORCEABILITY, OR RESULT IN THE CANCELLATION, OF SUCH INTENT-TO-USE
TRADEMARK APPLICATIONS UNDER APPLICABLE FEDERAL LAW), TOGETHER, IN EACH CASE,
WITH THE GOODWILL SYMBOLIZED THEREBY (“TRADEMARKS”);

 

(III)                               ALL COPYRIGHTS, INCLUDING, WITHOUT
LIMITATION, COPYRIGHTS IN COMPUTER SOFTWARE (AS HEREINAFTER DEFINED), INTERNET
WEB SITES AND THE CONTENT THEREOF, WHETHER REGISTERED OR UNREGISTERED;

 

(IV)                              ALL COMPUTER SOFTWARE, PROGRAMS AND DATABASES
(INCLUDING, WITHOUT LIMITATION, SOURCE CODE, OBJECT CODE AND ALL RELATED
APPLICATIONS AND DATA FILES), FIRMWARE AND DOCUMENTATION AND MATERIALS RELATING
THERETO, TOGETHER WITH ANY AND ALL MAINTENANCE RIGHTS, SERVICE RIGHTS,
PROGRAMMING RIGHTS, HOSTING RIGHTS, TEST RIGHTS, IMPROVEMENT RIGHTS, RENEWAL
RIGHTS AND INDEMNIFICATION RIGHTS AND ANY SUBSTITUTIONS, REPLACEMENTS,
IMPROVEMENTS, ERROR CORRECTIONS, UPDATES AND NEW VERSIONS OF ANY OF THE
FOREGOING (“COMPUTER SOFTWARE”);

 

(V)                                 ALL CONFIDENTIAL AND PROPRIETARY
INFORMATION, INCLUDING, WITHOUT LIMITATION, KNOW-HOW, TRADE SECRETS,
MANUFACTURING AND PRODUCTION PROCESSES AND TECHNIQUES, INVENTIONS, RESEARCH AND
DEVELOPMENT INFORMATION, DATABASES AND DATA, INCLUDING, WITHOUT LIMITATION,
TECHNICAL DATA, FINANCIAL, MARKETING AND BUSINESS DATA, PRICING AND COST
INFORMATION, BUSINESS AND MARKETING PLANS AND CUSTOMER AND SUPPLIER LISTS AND
INFORMATION, AND ALL OTHER INTELLECTUAL, INDUSTRIAL AND INTANGIBLE PROPERTY OF
ANY TYPE, INCLUDING, WITHOUT LIMITATION, INDUSTRIAL DESIGNS AND MASK WORKS;

 

(VI)                              ALL REGISTRATIONS AND APPLICATIONS FOR
REGISTRATION FOR ANY OF THE FOREGOING, TOGETHER WITH ALL REISSUES, DIVISIONS,
CONTINUATIONS, CONTINUATIONS-IN-PART, EXTENSIONS, RENEWALS AND REEXAMINATIONS
THEREOF;

 

(VII)                           ALL TANGIBLE EMBODIMENTS OF THE FOREGOING, ALL
RIGHTS IN THE FOREGOING PROVIDED BY INTERNATIONAL TREATIES OR CONVENTIONS, ALL
RIGHTS CORRESPONDING THERETO THROUGHOUT THE WORLD AND ALL OTHER RIGHTS OF ANY
KIND WHATSOEVER OF SUCH GRANTOR ACCRUING THEREUNDER OR PERTAINING THERETO;

 

(VIII)                        ALL AGREEMENTS, PERMITS, CONSENTS, ORDERS AND
FRANCHISES RELATING TO THE LICENSE, DEVELOPMENT, USE OR DISCLOSURE OF ANY OF THE
FOREGOING TO WHICH SUCH GRANTOR, NOW OR HEREAFTER, IS A PARTY OR A BENEFICIARY
(“IP AGREEMENTS”);

 

(IX)                                ANY AND ALL CLAIMS FOR DAMAGES AND
INJUNCTIVE RELIEF FOR PAST, PRESENT AND FUTURE INFRINGEMENT, DILUTION,
MISAPPROPRIATION, VIOLATION, MISUSE OR BREACH WITH RESPECT TO ANY OF THE
FOREGOING, WITH THE RIGHT, BUT NOT THE OBLIGATION, TO SUE FOR AND COLLECT, OR
OTHERWISE RECOVER PROCEEDS ARISING FROM SUCH DAMAGES;

 

(F)                                    ALL COMMERCIAL TORT CLAIMS;

 

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(G)                                 ALL BOOKS AND RECORDS (INCLUDING, WITHOUT
LIMITATION, CUSTOMER LISTS, CREDIT FILES, PRINTOUTS AND OTHER COMPUTER OUTPUT
MATERIALS AND RECORDS) OF SUCH GRANTOR PERTAINING TO ANY OF THE ADDITIONAL
COLLATERAL; AND

 

(H)                                 ALL PROCEEDS OF, COLLATERAL FOR, INCOME,
ROYALTIES AND OTHER PAYMENTS NOW OR HEREAFTER DUE AND PAYABLE WITH RESPECT TO,
AND SUPPORTING OBLIGATIONS RELATING TO, ANY AND ALL OF THE ADDITIONAL COLLATERAL
(INCLUDING, WITHOUT LIMITATION, PROCEEDS, COLLATERAL AND SUPPORTING OBLIGATIONS
THAT CONSTITUTE PROPERTY OF THE TYPES DESCRIBED IN CLAUSES (A) THROUGH (G) AND
THIS CLAUSE (H) OF THIS SECTION 1) AND, TO THE EXTENT NOT OTHERWISE INCLUDED,
ALL (A) PAYMENTS UNDER INSURANCE (WHETHER OR NOT THE COLLATERAL AGENT IS THE
LOSS PAYEE THEREOF), OR ANY INDEMNITY, WARRANTY OR GUARANTY, IN EACH CASE,
PAYABLE BY REASON OF LOSS OR DAMAGE TO OR OTHERWISE WITH RESPECT TO ANY OF THE
FOREGOING ADDITIONAL COLLATERAL, AND (B) CASH.

 

Notwithstanding the foregoing, “Additional Collateral” shall not include and the
Grantors shall not be deemed to have granted a security interest in any property
or agreement of such Grantor to the extent (but only so long as) (x) the
granting of a security interest thereunder is prohibited by any applicable law
or (y) is prohibited by, or constitutes a breach or default under or results in
the termination of or requires any consent not obtained under, any contract,
lease, license, agreement, instrument or other document giving rise to such
property, in each case solely to the extent that such breach or default is not
rendered ineffective by the UCC or other applicable law or, in the case of any
consent, such consent is actually required to grant such security interest under
applicable law.

 

Section 2. Security for Obligations; Interpretation.  This Agreement secures, in
the case of each Grantor, the payment of all Indebtedness and other obligations
of such Grantor now or hereafter existing under any of the Loan Documents (as
defined in each of the Loan Agreements), whether direct or indirect, absolute or
contingent, and whether for principal, reimbursement obligations, interest,
fees, premiums, penalties, indemnifications, contract causes of action, costs,
expenses or otherwise (all such obligations being the “Secured Obligations”). 
Without limiting the generality of the foregoing, this Agreement secures, as to
each Grantor, the payment of all amounts that constitute part of the Secured
Obligations and would be owed by such Grantor to any Secured Party under any of
the Loan Documents but for the fact that they are unenforceable or not allowable
due to the existence of a bankruptcy, reorganization or similar proceeding
involving a Loan Party.

 

Section 3. Grantors Remain Liable.  Anything herein to the contrary
notwithstanding, (a) each Grantor shall remain liable under the contracts and
agreements included in such Grantor’s Additional Collateral to the extent set
forth therein to perform all of its duties and obligations thereunder to the
same extent as if this Agreement had not been executed, (b) the exercise by the
Collateral Agent of any of the rights hereunder shall not release any Grantor
from any of its duties or obligations under the contracts and agreements
included in the Additional Collateral and (c) no Secured Party shall have any
obligation or liability under the contracts and agreements included in the
Additional Collateral by reason of this Agreement or any other Loan Document,
nor shall any Secured Party be obligated to perform any of the obligations or
duties of any Grantor thereunder or to take any action to collect or enforce any
claim for payment.

 

Section 4. Representations and Warranties.  Each Grantor represents and warrants
as follows:

 

(A)                                  AS OF THE DATE HEREOF, SUCH GRANTOR’S EXACT
LEGAL NAME, LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF ORGANIZATION, JURISDICTION
OF ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER IS SET FORTH IN
SCHEDULE I HERETO.  WITHIN THE FIVE YEARS PRECEDING THE DATE HEREOF, SUCH
GRANTOR HAS NOT CHANGED ITS NAME, LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF
ORGANIZATION, JURISDICTION OF ORGANIZATION OR ORGANIZATIONAL IDENTIFICATION
NUMBER FROM THOSE SET FORTH IN SCHEDULE I HERETO EXCEPT AS SET FORTH IN SCHEDULE
II HERETO.

 

(B)                                 SUCH GRANTOR IS THE LEGAL AND BENEFICIAL
OWNER OF THE ADDITIONAL COLLATERAL GRANTED OR PURPORTED TO BE GRANTED BY IT FREE
AND CLEAR OF ANY LIEN, CLAIM, OPTION OR RIGHT OF OTHERS, EXCEPT FOR THE SECURITY
INTEREST CREATED UNDER THIS AGREEMENT OR PERMITTED UNDER THE LOAN AGREEMENTS. 
EXCEPT AS PERMITTED UNDER THE LOAN AGREEMENTS, NO EFFECTIVE FINANCING STATEMENT
OR OTHER INSTRUMENT SIMILAR IN EFFECT COVERING ALL OR ANY PART OF SUCH
ADDITIONAL COLLATERAL OR LISTING SUCH GRANTOR OR ANY TRADE NAME OF SUCH GRANTOR
AS DEBTOR IS ON FILE IN ANY RECORDING OFFICE, EXCEPT SUCH AS MAY HAVE BEEN FILED
IN FAVOR OF THE COLLATERAL AGENT RELATING TO THE LOAN DOCUMENTS, FILINGS WHICH
HAVE NOT BEEN AUTHORIZED BY THE APPLICABLE GRANTOR OR AS OTHERWISE PERMITTED
UNDER THE LOAN AGREEMENTS.

 

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(C)           THIS AGREEMENT CREATES IN FAVOR OF THE COLLATERAL AGENT FOR THE
BENEFIT OF THE SECURED PARTIES UNDER THE LOAN AGREEMENTS A VALID SECURITY
INTEREST IN THE ADDITIONAL COLLATERAL GRANTED BY SUCH GRANTOR (TO THE EXTENT
SUCH MATTER IS GOVERNED BY THE LAWS OF THE UNITED STATES, OR A JURISDICTION
LOCATED THEREIN), SECURING THE PAYMENT OF THE SECURED OBLIGATIONS; ALL FILINGS
AND OTHER ACTIONS NECESSARY TO PERFECT THE SECURITY INTEREST IN THE ADDITIONAL
COLLATERAL GRANTED BY SUCH GRANTOR, TO THE EXTENT REQUIRED HEREUNDER, HAVE BEEN
OR WILL BE TIMELY MADE OR TAKEN AND ARE, OR WILL BE, IN FULL FORCE AND EFFECT
(BUT ONLY TO THE EXTENT PERFECTION CAN BE ACCOMPLISHED BY FILING A FINANCIAL
STATEMENT IN THE PROPER JURISDICTION); SUCH SECURITY INTEREST IS FIRST PRIORITY
EXCEPT FOR THE LIENS PERMITTED BY THE LOAN AGREEMENTS.

 

(D)           TO SUCH GRANTOR’S KNOWLEDGE, NO MATERIAL GOVERNMENTAL
AUTHORIZATION BY, AND NO NOTICE TO OR FILING WITH, ANY GOVERNMENTAL AUTHORITY OR
OTHER THIRD PARTY IS REQUIRED FOR THE GRANT BY SUCH GRANTOR OF THE SECURITY
INTEREST GRANTED HEREUNDER OR FOR THE EXECUTION, DELIVERY OR PERFORMANCE OF THIS
AGREEMENT BY SUCH GRANTOR.

 

(E)           AS TO ITSELF AND ITS MATERIAL INTELLECTUAL PROPERTY COLLATERAL
(I) TO SUCH GRANTOR’S KNOWLEDGE, THE OPERATION OF SUCH GRANTOR’S BUSINESS AS
CURRENTLY CONDUCTED OR AS CONTEMPLATED TO BE CONDUCTED AND THE USE OF THE
INTELLECTUAL PROPERTY COLLATERAL IN CONNECTION THEREWITH DO NOT CONFLICT WITH,
INFRINGE, MISAPPROPRIATE, DILUTE, MISUSE OR OTHERWISE VIOLATE THE INTELLECTUAL
PROPERTY RIGHTS OF ANY THIRD PARTY, (II) SUCH GRANTOR IS THE EXCLUSIVE OWNER OF
ALL RIGHT, TITLE AND INTEREST IN AND TO, OR HAS A VALID RIGHT TO USE, ALL
INTELLECTUAL PROPERTY COLLATERAL SUBJECT ONLY TO THE TERMS OF THE IP AGREEMENTS
AND (III) THERE IS NO JUDGMENT OR DECREE IN RESPECT OF ANY INTELLECTUAL PROPERTY
COLLATERAL THAT WOULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

Section 5. Further Assurances.  (a)  Each Grantor agrees that from time to time,
at the expense of such Grantor, such Grantor will promptly execute and deliver,
or otherwise authenticate, all further instruments and documents, and take all
further action that may be necessary or reasonably desirable, or that the
Collateral Agent may reasonably request, in order to perfect and maintain
perfection of any pledge or security interest granted or purported to be granted
by such Grantor hereunder or to enable the Collateral Agent to exercise and
enforce its rights and remedies hereunder with respect to any Additional
Collateral of such Grantor.  Without limiting the generality of the foregoing,
each Grantor will promptly with respect to Additional Collateral of such
Grantor:  (i) execute or authenticate and file, or authorize the Collateral
Agent to file, such financing or continuation statements, or amendments thereto,
and as permitted by the terms of this Agreement or otherwise with the Grantor’s
consent, such other instruments or notices, as may be necessary or desirable, or
as the Collateral Agent may reasonably request, in order to perfect and preserve
the security interest granted or purported to be granted by such Grantor
hereunder; (ii) upon the occurrence and during the continuance of an Event of
Default, take all action necessary to ensure that the Collateral Agent has
control of Additional Collateral consisting of deposit accounts, electronic
chattel paper and letter of credit rights as provided in Sections 9-104, 9-105
and 9-107 of the UCC; and (iii) deliver to the Collateral Agent evidence that
all other actions that the Collateral Agent may deem reasonably necessary or
desirable in order to perfect and protect the security interest granted or
purported to be granted by such Grantor under this Agreement has been taken.
Notwithstanding anything to the contrary set forth in this Section 5 or in this
Agreement, unless an Event of Default shall have occurred and be continuing,
(A) the Grantors shall not be required to take any action to perfect the
security interests granted under this Agreement in any Additional Collateral
other than executing, authenticating and filing, or authorizing the Collateral
Agent to file, financing or continuation statements, or amendments thereto and
(B) landlords and warehousemen shall be not be required to provide access or
subordination agreements.

 

(B)           EACH GRANTOR HEREBY AUTHORIZES THE COLLATERAL AGENT TO FILE ONE OR
MORE FINANCING OR CONTINUATION STATEMENTS, AND AMENDMENTS THERETO, INCLUDING,
WITHOUT LIMITATION, ONE OR MORE FINANCING STATEMENTS INDICATING THAT SUCH
FINANCING STATEMENTS COVER ALL ASSETS OR ALL PERSONAL PROPERTY (OR WORDS OF
SIMILAR EFFECT) OF SUCH GRANTOR, IN EACH CASE WITHOUT THE SIGNATURE OF SUCH
GRANTOR, AND REGARDLESS OF WHETHER ANY PARTICULAR ASSET DESCRIBED IN SUCH
FINANCING STATEMENTS FALLS WITHIN THE SCOPE OF THE UCC OR THE GRANTING CLAUSE OF
THIS AGREEMENT.  A PHOTOCOPY OR OTHER REPRODUCTION OF THIS AGREEMENT SHALL BE
SUFFICIENT AS A FINANCING STATEMENT WHERE PERMITTED BY LAW.  EACH GRANTOR
RATIFIES ITS AUTHORIZATION FOR THE COLLATERAL AGENT TO HAVE FILED SUCH FINANCING
STATEMENTS, CONTINUATION STATEMENTS OR AMENDMENTS FILED PRIOR TO THE DATE
HEREOF.

 

(C)           UPON THE OCCURRENCE AND CONTINUANCE OF AN EVENT OF DEFAULT, UPON
THE WRITTEN REQUEST OF THE COLLATERAL AGENT, EACH GRANTOR WILL FURNISH TO THE
COLLATERAL AGENT FROM TIME TO TIME STATEMENTS AND SCHEDULES

 

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FURTHER IDENTIFYING AND DESCRIBING THE ADDITIONAL COLLATERAL OF SUCH GRANTOR AND
SUCH OTHER REPORTS IN CONNECTION WITH SUCH ADDITIONAL COLLATERAL AS THE
COLLATERAL AGENT MAY REASONABLY REQUEST, ALL IN REASONABLE DETAIL.

 

SECTION 6. AS TO EQUIPMENT AND INVENTORY  EACH GRANTOR WILL CAUSE ITS EQUIPMENT
TO BE MAINTAINED AND PRESERVED IN THE SAME CONDITION, REPAIR AND WORKING ORDER
AS WHEN NEW, ORDINARY WEAR AND TEAR AND CASUALTY AND CONDEMNATION LOSSES
EXCEPTED, AND WILL FORTHWITH, OR IN THE CASE OF ANY LOSS OR DAMAGE TO ANY OF
SUCH EQUIPMENT AS SOON AS PRACTICABLE AFTER THE OCCURRENCE THEREOF, MAKE OR
CAUSE TO BE MADE ALL REPAIRS, REPLACEMENTS AND OTHER IMPROVEMENTS IN CONNECTION
THEREWITH THAT SUCH GRANTOR DETERMINES ARE NECESSARY OR DESIRABLE TO SUCH END.

 

Section 7. Insurance.  Each Grantor will, at its own expense, maintain insurance
with respect to its Equipment and Inventory in the manner required by the Loan
Agreements.

 

Section 8. Post-Closing Changes; Collections on Receivables and Related
Contracts.  (a)  No Grantor will change its name, type of organization,
jurisdiction of organization, organizational identification number or location
from those set forth in Section 4(a) of this Agreement without first giving at
least 15 days’ prior written notice to the Collateral Agent and taking all
action reasonably required by the Collateral Agent for the purpose of perfecting
or protecting the security interest granted by this Agreement.  Each Grantor
will hold and preserve its records relating to the Additional Collateral and
will permit representatives of the Collateral Agent at any reasonable time
during normal business hours upon reasonable advance notice to inspect and make
abstracts from such records and other documents.  If any Grantor does not have
an organizational identification number and later obtains one, it will forthwith
notify the Collateral Agent of such organizational identification number.

 

(B)           EXCEPT AS OTHERWISE PROVIDED IN THIS SUBSECTION (B), EACH GRANTOR
WILL CONTINUE TO COLLECT, AT ITS OWN EXPENSE, ALL AMOUNTS DUE OR TO BECOME DUE
SUCH GRANTOR UNDER THE RECEIVABLES AND RELATED CONTRACTS.  IN CONNECTION WITH
SUCH COLLECTIONS, SUCH GRANTOR MAY TAKE (AND, AT THE COLLATERAL AGENT’S
DIRECTION, UPON THE OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF
DEFAULT, WILL TAKE) SUCH ACTION AS SUCH GRANTOR OR THE COLLATERAL AGENT MAY DEEM
NECESSARY OR ADVISABLE TO ENFORCE COLLECTION OF THE RECEIVABLES AND RELATED
CONTRACTS; PROVIDED, HOWEVER, THAT THE COLLATERAL AGENT SHALL HAVE THE RIGHT AT
ANY TIME, UPON THE OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT
AND UPON WRITTEN NOTICE TO SUCH GRANTOR OF ITS INTENTION TO DO SO, TO NOTIFY THE
OBLIGORS UNDER ANY RECEIVABLES AND RELATED CONTRACTS OF THE ASSIGNMENT OF SUCH
RECEIVABLES AND RELATED CONTRACTS TO THE COLLATERAL AGENT AND TO DIRECT SUCH
OBLIGORS TO MAKE PAYMENT OF ALL AMOUNTS DUE OR TO BECOME DUE TO SUCH GRANTOR
THEREUNDER DIRECTLY TO THE COLLATERAL AGENT AND, UPON SUCH NOTIFICATION AND AT
THE EXPENSE OF SUCH GRANTOR, TO ENFORCE COLLECTION OF ANY SUCH RECEIVABLES AND
RELATED CONTRACTS, TO ADJUST, SETTLE OR COMPROMISE THE AMOUNT OR PAYMENT
THEREOF, IN THE SAME MANNER AND TO THE SAME EXTENT AS SUCH GRANTOR MIGHT HAVE
DONE, AND TO OTHERWISE EXERCISE ALL RIGHTS WITH RESPECT TO SUCH RECEIVABLES AND
RELATED CONTRACTS, INCLUDING, WITHOUT LIMITATION, THOSE SET FORTH SET FORTH IN
SECTION 9-607 OF THE UCC.  AFTER RECEIPT BY ANY GRANTOR OF THE NOTICE FROM THE
COLLATERAL AGENT REFERRED TO IN THE PROVISO TO THE PRECEDING SENTENCE, UPON THE
OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT (I) ALL AMOUNTS AND
PROCEEDS (INCLUDING, WITHOUT LIMITATION, INSTRUMENTS) RECEIVED BY SUCH GRANTOR
IN RESPECT OF THE RECEIVABLES AND RELATED CONTRACTS OF SUCH GRANTOR SHALL BE
DEEMED TO BE RECEIVED IN TRUST FOR THE BENEFIT OF THE COLLATERAL AGENT
HEREUNDER, SHALL BE SEGREGATED FROM OTHER FUNDS OF SUCH GRANTOR AND SHALL BE
FORTHWITH PAID OVER TO THE COLLATERAL AGENT IN THE SAME FORM AS SO RECEIVED
(WITH ANY NECESSARY INDORSEMENT) TO BE DEPOSITED IN THE COLLATERAL ACCOUNT AND
EITHER (A) RELEASED TO SUCH GRANTOR SO LONG AS NO EVENT OF DEFAULT SHALL HAVE
OCCURRED AND BE CONTINUING OR (B) IF ANY EVENT OF DEFAULT SHALL HAVE OCCURRED
AND BE CONTINUING, APPLIED AS PROVIDED IN SECTION 16(B) AND (II) SUCH GRANTOR
WILL NOT ADJUST, SETTLE OR COMPROMISE THE AMOUNT OR PAYMENT OF ANY RECEIVABLE OR
AMOUNT DUE ON ANY RELATED CONTRACT, RELEASE WHOLLY OR PARTLY ANY OBLIGOR THEREOF
OR ALLOW ANY CREDIT OR DISCOUNT THEREON.  NO GRANTOR WILL PERMIT OR CONSENT TO
THE SUBORDINATION OF ITS RIGHT TO PAYMENT UNDER ANY OF THE RECEIVABLES AND
RELATED CONTRACTS TO ANY OTHER INDEBTEDNESS OR OBLIGATIONS OF THE OBLIGOR
THEREOF.

 

Section 9. As to Intellectual Property Collateral.  Each Grantor shall take such
commercially reasonable actions to take all steps as are reasonable and
appropriate under the circumstances (all as determined by the Board of Directors
of the Grantor) to preserve and protect each material item of its Intellectual
Property Collateral.

 

Section 10. As to Letter-of-Credit Rights.  Each Grantor, by granting a security
interest in its Receivables consisting of letter-of-credit rights to the
Collateral Agent, intends to (and hereby does) assign to the

 

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Collateral Agent its rights (including its contingent rights) to the proceeds of
all Related Contracts consisting of letters of credit of which it is or
hereafter becomes a beneficiary or assignee.  Upon the occurrence and during the
continuance of an Event of Default, each Grantor will promptly use commercially
reasonable efforts to cause the issuer of each letter of credit and each
nominated person (if any) with respect thereto to consent to such assignment of
the proceeds thereof pursuant to a consent in form and substance reasonably
satisfactory to the Collateral Agent and deliver written evidence of such
consent to the Collateral Agent.

 

Section 11. Commercial Tort Claims.  Each Grantor will promptly give notice to
the Collateral Agent of any commercial tort claim that may arise after the date
hereof with an anticipated recovery of at least $5,000,000 and, upon the request
of the Collateral Agent, will promptly execute or otherwise authenticate a
supplement to this Agreement, and otherwise take all action reasonably necessary
to subject such commercial tort claim to the security interest created under
this Agreement.

 

Section 12. Transfers and Other Liens; Additional Shares.  Each Grantor agrees
that:

 

(A)           IT WILL NOT (I) SELL, ASSIGN OR OTHERWISE DISPOSE OF, OR GRANT ANY
OPTION WITH RESPECT TO, ANY OF THE ADDITIONAL COLLATERAL, OTHER THAN SALES,
ASSIGNMENTS AND OTHER DISPOSITIONS OF ADDITIONAL COLLATERAL, AND OPTIONS
RELATING TO ADDITIONAL COLLATERAL, PERMITTED UNDER THE TERMS OF THIS AGREEMENT
OR THE LOAN AGREEMENTS, OR (II) CREATE OR SUFFER TO EXIST ANY LIEN UPON OR WITH
RESPECT TO ANY OF THE ADDITIONAL COLLATERAL OF SUCH GRANTOR EXCEPT FOR THE
PLEDGE, ASSIGNMENT AND SECURITY INTEREST CREATED UNDER THIS AGREEMENT AND LIENS
PERMITTED UNDER THE LOAN AGREEMENTS.

 

Section 13. Collateral Agent Appointed Attorney-in-Fact.  Each Grantor hereby
irrevocably appoints the Collateral Agent such Grantor’s attorney-in-fact (such
appointment to cease upon the payment in full of all the Secured Obligations
other than contingent indemnification claims as to which no demand has been
made), with full authority in the place and stead of such Grantor and in the
name of such Grantor or otherwise, from time to time, upon the occurrence and
during the continuance of an Event of Default, in the Collateral Agent’s
reasonable discretion, to take any action and to execute any instrument that the
Collateral Agent may deem reasonably necessary or advisable to accomplish the
purposes of this Agreement, including, without limitation:

 

(A)           TO ASK FOR, DEMAND, COLLECT, SUE FOR, RECOVER, COMPROMISE, RECEIVE
AND GIVE ACQUITTANCE AND RECEIPTS FOR MONEYS DUE AND TO BECOME DUE UNDER OR IN
RESPECT OF ANY OF THE ADDITIONAL COLLATERAL,

 

(B)           TO RECEIVE, INDORSE AND COLLECT ANY DRAFTS OR OTHER INSTRUMENTS,
DOCUMENTS AND CHATTEL PAPER, IN CONNECTION WITH CLAUSE (A) OR (B) ABOVE, AND

 

(C)           TO FILE ANY CLAIMS OR TAKE ANY ACTION OR INSTITUTE ANY PROCEEDINGS
THAT THE COLLATERAL AGENT MAY DEEM NECESSARY OR DESIRABLE FOR THE COLLECTION OF
ANY OF THE ADDITIONAL COLLATERAL OR OTHERWISE TO ENFORCE THE RIGHTS OF THE
COLLATERAL AGENT WITH RESPECT TO ANY OF THE ADDITIONAL COLLATERAL.

 

Section 14. Collateral Agent May Perform.  If any Grantor fails to perform any
agreement contained herein, the Collateral Agent may, as the Collateral Agent
deems necessary to protect the security interest granted hereunder in the
Additional Collateral or to protect the value thereof, but without any
obligation to do so and without notice, itself perform, or cause performance of,
such agreement, and the expenses of the Collateral Agent incurred in connection
therewith shall be payable by such Grantor under Section 17.

 

Section 15. The Collateral Agent’s Duties.  a.  The powers conferred on the
Collateral Agent hereunder are solely to protect the Secured Parties’ interest
in the Additional Collateral and shall not impose any fiduciary relationship or
any duty upon it to exercise any such powers.  Except for the exercise of
reasonable care in the safe custody of any Additional Collateral in its
possession or in the possession of an Affiliate of the Collateral Agent or any
designee (including without limitation, a Subagent (as defined in clause
(b) below)) of the Collateral Agent acting on its behalf and the accounting for
moneys actually received by it or its Affiliates hereunder in accordance with
the express terms hereof, the Collateral Agent shall have no fiduciary
relationship or other duty as to any Additional Collateral, as to ascertaining
or taking action with respect to calls, conversions, exchanges, maturities,
tenders or other matters relative to any Additional Collateral, whether or not
any Secured Party has or is

 

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deemed to have knowledge of such matters, or as to the taking of any necessary
steps to preserve rights against any parties or any other rights pertaining to
any Additional Collateral.  The Collateral Agent and any of its Affiliates or
any designee (including without limitation, a Subagent) on its behalf shall be
deemed to have exercised reasonable care in the custody and preservation of any
Additional Collateral in its possession or in the possession of an Affiliate or
any designee (including without limitation, a Subagent) on its behalf if such
Additional Collateral is accorded treatment substantially equal to that which it
accords its own property.

 

(B)           ANYTHING CONTAINED HEREIN TO THE CONTRARY NOTWITHSTANDING, THE
COLLATERAL AGENT MAY FROM TIME TO TIME, WHEN THE COLLATERAL AGENT DEEMS IT TO BE
NECESSARY, APPOINT ONE OR MORE SUBAGENTS (EACH A “SUBAGENT”) FOR THE COLLATERAL
AGENT HEREUNDER WITH RESPECT TO ALL OR ANY PART OF THE ADDITIONAL COLLATERAL. 
IN THE EVENT THAT THE COLLATERAL AGENT SO APPOINTS ANY SUBAGENT WITH RESPECT TO
ANY ADDITIONAL COLLATERAL, (I) THE ASSIGNMENT AND PLEDGE OF SUCH ADDITIONAL
COLLATERAL AND THE SECURITY INTEREST GRANTED IN SUCH ADDITIONAL COLLATERAL BY
EACH GRANTOR HEREUNDER SHALL BE DEEMED FOR PURPOSES OF THIS SECURITY AGREEMENT B
TO HAVE BEEN MADE TO SUCH SUBAGENT, IN ADDITION TO THE COLLATERAL AGENT, FOR THE
RATABLE BENEFIT OF THE SECURED PARTIES, AS SECURITY FOR THE SECURED OBLIGATIONS
OF SUCH GRANTOR, (II) SUCH SUBAGENT SHALL AUTOMATICALLY BE VESTED, IN ADDITION
TO THE COLLATERAL AGENT, WITH ALL RIGHTS, POWERS, PRIVILEGES, INTERESTS AND
REMEDIES OF THE COLLATERAL AGENT HEREUNDER AND PURSUANT TO THE TERMS HEREOF,
WITH RESPECT TO SUCH ADDITIONAL COLLATERAL, AND (III) THE TERM “COLLATERAL
AGENT,” WHEN USED HEREIN IN RELATION TO ANY RIGHTS, POWERS, PRIVILEGES,
INTERESTS AND REMEDIES OF THE COLLATERAL AGENT WITH RESPECT TO SUCH ADDITIONAL
COLLATERAL, SHALL INCLUDE SUCH SUBAGENT; PROVIDED, HOWEVER, THAT NO SUCH
SUBAGENT SHALL BE AUTHORIZED TO TAKE ANY ACTION WITH RESPECT TO ANY SUCH
ADDITIONAL COLLATERAL UNLESS AND EXCEPT TO THE EXTENT EXPRESSLY AUTHORIZED IN
WRITING BY THE COLLATERAL AGENT.

 

(C)           EACH SECURED PARTY BY ITS ACCEPTANCE THEREOF HEREBY APPOINTS AND
AUTHORIZES THE COLLATERAL AGENT TO TAKE SUCH ACTION AS AGENT ON ITS BEHALF AND
TO EXERCISE SUCH POWERS HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS AS ARE
SPECIFICALLY DELEGATED TO THE COLLATERAL AGENT BY THE TERMS OF THIS AGREEMENT
AND THE LOAN DOCUMENTS, TOGETHER WITH SUCH OTHER POWERS AS ARE REASONABLY
INCIDENTAL THERETO.  THE COLLATERAL AGENT SHALL NOT HAVE ANY DUTIES OR
RESPONSIBILITIES EXCEPT THOSE EXPRESSLY SET FORTH IN THIS AGREEMENT AND THE LOAN
DOCUMENTS.

 

(D)           AS TO ANY MATTERS NOT EXPRESSLY PROVIDED FOR BY THE LOAN
DOCUMENTS, THE COLLATERAL AGENT SHALL NOT BE REQUIRED TO EXERCISE ANY DISCRETION
OR TAKE ANY ACTION, BUT SHALL BE REQUIRED TO ACT OR TO REFRAIN FROM ACTING (AND
SHALL BE FULLY PROTECTED IN SO ACTING OR REFRAINING FROM ACTING) UPON THE
WRITTEN INSTRUCTIONS SIGNED BY THE TERM LOAN ADMINISTRATIVE AGENT AND THE
REVOLVING LOAN ADMINISTRATIVE AGENT PROVIDED, HOWEVER, THAT THE COLLATERAL AGENT
SHALL NOT BE REQUIRED TO TAKE ANY ACTION THAT EXPOSES THE COLLATERAL AGENT TO
PERSONAL LIABILITY OR THAT IS CONTRARY TO THIS AGREEMENT OR APPLICABLE LAW. THE
COLLATERAL AGENT SHALL IN ALL CASES BE FULLY PROTECTED IN ACTING OR REFRAINING
FROM ACTING UNDER THIS AGREEMENT OR ANY OF THE LOAN DOCUMENTS UPON WRITTEN
DIRECTIONS SIGNED BY THE TERM LOAN ADMINISTRATIVE AGENT AND THE REVOLVING LOAN
ADMINISTRATIVE AGENT, EXCEPT FOR ANY SUCH ACTIONS (OR RESTRAINT OF ACTIONS)
WHICH CONSTITUTE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT ON THE PART OF THE
COLLATERAL AGENT. ANY SUCH DIRECTIONS BY THE COLLATERAL AGENT AND ANY ACTION
TAKEN BY THE COLLATERAL AGENT AND ANY FAILURE BY THE COLLATERAL AGENT TO ACT, IN
EACH CASE PURSUANT TO SUCH DIRECTIONS, SHALL BE BINDING ON ALL THE SECURED
PARTIES AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS.  THE COLLATERAL AGENT SHALL
NOT BE RESPONSIBLE TO ANY SECURED PARTY FOR ANY RECITALS, STATEMENTS,
REPRESENTATIONS, OR WARRANTIES (OTHER THAN ANY THEREOF MADE BY THE COLLATERAL
AGENT OR ANY OFFICER THEREOF) CONTAINED IN THIS AGREEMENT OR IN ANY OF THE LOAN
DOCUMENTS, FOR THE VALUE, VALIDITY, EFFECTIVENESS, GENUINENESS, ENFORCEABILITY,
OR SUFFICIENCY OF THIS AGREEMENT, OF ANY OF THE LOAN DOCUMENTS, OR OF THE
ADDITIONAL COLLATERAL, OR FOR THE CREATION, MAINTENANCE, PRIORITY OR PERFECTION
OF ANY LIEN CREATED BY THE LOAN DOCUMENTS.

 

(E)           SUBJECT TO THE PROVISIONS OF SECTION 15(D), THE COLLATERAL AGENT
MAY CONSULT WITH INDEPENDENT LEGAL COUNSEL AND THE ADVICE OF SUCH COUNSEL SHALL
BE FULL AND COMPLETE AUTHORIZATION AND PROTECTION IN RESPECT OF ANY ACTION TO BE
TAKEN, SUFFERED, OR OMITTED BY IT HEREUNDER IN GOOD FAITH AND IN RELIANCE
THEREON.  THE COLLATERAL AGENT MAY EXECUTE ANY OF THE RIGHTS OR POWERS HEREUNDER
OR PERFORM ANY DUTIES HEREUNDER EITHER DIRECTLY OR THROUGH OTHER AGENTS OR
ATTORNEYS REASONABLY ACCEPTABLE TO THE REQUIRED LENDERS UNDER EACH OF THE LOAN
AGREEMENTS.  THE COLLATERAL AGENT SHALL NOT BE LIABLE FOR THE MISCONDUCT OR
NEGLIGENCE OF ANY SUCH AGENT OR ATTORNEY APPOINTED BY IT WITH DUE CARE.  THE
FOREGOING SHALL NOT EXCULPATE ANY SUCH AGENT OR ATTORNEY FROM LIABILITY FOR ITS
OWN MISCONDUCT OR NEGLIGENCE.

 

(F)            THE COLLATERAL AGENT, IN ITS INDIVIDUAL CAPACITY AND ITS
AFFILIATES MAY ACCEPT DEPOSITS FROM, LEND TO, AND GENERALLY ENGAGE IN ANY KIND
OF LENDING, BANKING, OR TRUST BUSINESS WITH, ANY GRANTOR OR THEIR

 

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RESPECTIVE AFFILIATES AS IF IT WERE NOT ACTING AS THE COLLATERAL AGENT.  WITH
RESPECT TO ITS COMMITMENT AND IN ITS CAPACITY AS A LENDER UNDER EACH OF THE LOAN
AGREEMENTS, THE COLLATERAL AGENT SHALL HAVE AND MAY EXERCISE THE SAME RIGHTS AND
POWERS UNDER THIS AGREEMENT AND IS SUBJECT TO THE SAME OBLIGATIONS AND
LIABILITIES AS APPLICABLE TO ANY OTHER LENDER.

 

(G)           TO THE EXTENT THAT GRANTORS FAIL TO DO SO UNDER THE TERMS OF THE
LOAN DOCUMENTS, AND WITHOUT LIMITING THE PRIMARY OBLIGATION OF GRANTORS TO DO
SO, THE SECURED PARTIES WILL REIMBURSE THE COLLATERAL AGENT UPON DEMAND AND HOLD
THE COLLATERAL AGENT, ITS DIRECTORS, OFFICERS, EMPLOYEES, AND AGENTS HARMLESS
AGAINST ANY AND ALL LOSSES, LIABILITIES, OR EXPENSES INCURRED BY THE COLLATERAL
AGENT ARISING OUT OF OR IN CONNECTION WITH ANY ACTION TAKEN PURSUANT TO AND
CONSISTENTLY WITH THE EXPRESS WRITTEN DIRECTION OF THE APPLICABLE SECURED
PARTIES GIVEN UNDER SECTION 15(D), INCLUDING ANY COSTS AND EXPENSES INCURRED IN
CONNECTION WITH ANY INVESTIGATION, SUIT (WHETHER OR NOT THE COLLATERAL AGENT OR
ANY OTHER SUCH INDEMNIFIED PERSON IS NAMED AS A PARTY THERETO), OR CLAIM ARISING
OUT OF OR RELATED TO SUCH ACTION, IN PROPORTION TO THE RESPECTIVE PRINCIPAL
AMOUNTS OF THE INDEBTEDNESS UNDER THE LOAN AGREEMENTS AT THE TIME HELD BY THEM,
PROVIDED, THAT NO SECURED PARTY SHALL BE LIABLE UNDER THIS SECTION 15(G) FOR ANY
SUCH LOSSES, LIABILITIES, OR EXPENSES INCURRED BY THE COLLATERAL AGENT AS A
RESULT OF ITS OWN BREACH OF THIS AGREEMENT, GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT.

 

(H)           THE COLLATERAL AGENT MAY RESIGN AT ANY TIME BY GIVING AT LEAST
FORTY-FIVE (45) DAYS’ PRIOR WRITTEN NOTICE OF RESIGNATION TO GRANTORS AND EACH
SECURED PARTY, SUCH RESIGNATION TO BE EFFECTIVE UPON THE APPOINTMENT OF A
SUCCESSOR COLLATERAL AGENT AS PROVIDED IN THIS SECTION 15.  THE COLLATERAL AGENT
MAY BE REMOVED AT ANY TIME, FOR OR WITHOUT CAUSE, BY AN INSTRUMENT OR
INSTRUMENTS IN WRITING DELIVERED TO THE COLLATERAL AGENT AND GRANTORS AND SIGNED
BY THE REQUIRED LENDERS UNDER BOTH OF THE LOAN AGREEMENTS.  IN CASE THE OFFICE
OF COLLATERAL AGENT SHALL BECOME VACANT FOR ANY REASON, A SUCCESSOR COLLATERAL
AGENT MAY BE APPOINTED TO FILL SUCH VACANCY BY AN INSTRUMENT OR INSTRUMENTS IN
WRITING DELIVERED TO SUCH SUCCESSOR COLLATERAL AGENT, THE DEPARTING COLLATERAL
AGENT, EACH LENDER UNDER ANY LOAN AGREEMENT AND GRANTORS.  AFTER ANY SUCH
RESIGNATION OR REMOVAL, THE PROVISIONS OF THIS SECTION 15 SHALL CONTINUE IN
EFFECT FOR THE BENEFIT OF THE DEPARTING COLLATERAL AGENT WITH RESPECT TO ANY
ACTIONS TAKEN OR OMITTED BY IT WHILE ACTING AS COLLATERAL AGENT.

 

(I)            ANY CORPORATION OR NATIONAL BANKING ASSOCIATION INTO WHICH THE
COLLATERAL AGENT MAY BE MERGED OR WITH WHICH IT MAY BE CONSOLIDATED, OR ANY
CORPORATION OR NATIONAL BANKING ASSOCIATION RESULTING FROM ANY MERGER OR
CONSOLIDATION TO WHICH THE COLLATERAL AGENT IS A PARTY, OR ANY STATE OR NATIONAL
BANK OR TRUST COMPANY IN ANY MANNER SUCCEEDING TO ALL OR SUBSTANTIALLY ALL OF
THE BUSINESS OF THE COLLATERAL AGENT AND SHALL AUTOMATICALLY SUCCEED TO ALL OF
THE RIGHTS AND OBLIGATIONS OF THE COLLATERAL AGENT HEREUNDER AND UNDER THE LOAN
DOCUMENTS WITHOUT FURTHER ACTION ON THE PART OF ANY OF THE PARTIES HERETO.  SUCH
SURVIVING OR SUCCEEDING CORPORATION OR NATIONAL BANKING ASSOCIATION (IF OTHER
THAN THE COLLATERAL AGENT) SHALL FORTHWITH DELIVER TO EACH SECURED PARTY AND
GRANTORS WRITTEN NOTICE OF SUCH SUCCESSION TO THE RIGHTS AND OBLIGATIONS OF THE
COLLATERAL AGENT HEREUNDER AND UNDER THE LOAN DOCUMENTS.

Section 16. Remedies.  If any Event of Default shall have occurred and be
continuing:

 

(A)           THE COLLATERAL AGENT MAY EXERCISE IN RESPECT OF THE ADDITIONAL
COLLATERAL, IN ADDITION TO OTHER RIGHTS AND REMEDIES PROVIDED FOR HEREIN OR
OTHERWISE AVAILABLE TO IT, ALL THE RIGHTS AND REMEDIES OF A SECURED PARTY UPON
DEFAULT UNDER THE UCC AND ALSO MAY:  (I) REQUIRE EACH GRANTOR TO, AND EACH
GRANTOR HEREBY AGREES THAT IT WILL AT ITS EXPENSE AND UPON REQUEST OF THE
COLLATERAL AGENT FORTHWITH, ASSEMBLE ALL OR PART OF THE ADDITIONAL COLLATERAL AS
DIRECTED BY THE COLLATERAL AGENT AND MAKE IT AVAILABLE TO THE COLLATERAL AGENT
AT A PLACE AND TIME TO BE DESIGNATED BY THE COLLATERAL AGENT THAT IS REASONABLY
CONVENIENT TO BOTH PARTIES; (II) WITHOUT NOTICE EXCEPT AS SPECIFIED BELOW, SELL
THE ADDITIONAL COLLATERAL OR ANY PART THEREOF IN ONE OR MORE PARCELS AT PUBLIC
OR PRIVATE SALE, AT ANY OF THE COLLATERAL AGENT’S OFFICES OR ELSEWHERE, FOR
CASH, ON CREDIT OR FOR FUTURE DELIVERY, AND UPON SUCH OTHER TERMS AS THE
COLLATERAL AGENT MAY IN ITS REASONABLE DISCRETION DEEM COMMERCIALLY REASONABLE;
(III) OCCUPY ANY PREMISES OWNED BY ANY OF THE GRANTORS WHERE THE ADDITIONAL
COLLATERAL OR ANY PART THEREOF IS ASSEMBLED OR LOCATED FOR A REASONABLE PERIOD
IN ORDER TO EFFECTUATE ITS RIGHTS AND REMEDIES HEREUNDER OR UNDER LAW, WITHOUT
OBLIGATION TO SUCH GRANTOR IN RESPECT OF SUCH OCCUPATION; AND (IV) EXERCISE ANY
AND ALL RIGHTS AND REMEDIES OF ANY OF THE GRANTORS UNDER OR IN CONNECTION WITH
THE ADDITIONAL COLLATERAL, OR OTHERWISE IN RESPECT OF THE ADDITIONAL COLLATERAL,
INCLUDING, WITHOUT LIMITATION, (A) ANY AND ALL RIGHTS OF SUCH GRANTOR TO DEMAND
OR OTHERWISE REQUIRE PAYMENT OF ANY

 

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AMOUNT UNDER, OR PERFORMANCE OF ANY PROVISION OF, THE RECEIVABLES, THE RELATED
CONTRACTS AND THE OTHER ADDITIONAL COLLATERAL, (B) WITHDRAW, OR CAUSE OR DIRECT
THE WITHDRAWAL, OF ALL FUNDS WITH RESPECT TO THE ACCOUNT COLLATERAL AND
(C) EXERCISE ALL OTHER RIGHTS AND REMEDIES WITH RESPECT TO THE RECEIVABLES, THE
RELATED CONTRACTS AND THE OTHER ADDITIONAL COLLATERAL, INCLUDING, WITHOUT
LIMITATION, THOSE SET FORTH IN SECTION 9-607 OF THE UCC.  EACH GRANTOR AGREES
THAT, TO THE EXTENT NOTICE OF SALE SHALL BE REQUIRED BY LAW, AT LEAST TEN DAYS’
NOTICE TO SUCH GRANTOR OF THE TIME AND PLACE OF ANY PUBLIC SALE OR THREE DAYS’
NOTICE OF THE TIME AND PLACE OF ANY PRIVATE SALE SHALL CONSTITUTE REASONABLE
NOTIFICATION.  THE COLLATERAL AGENT SHALL NOT BE OBLIGATED TO MAKE ANY SALE OF
ADDITIONAL COLLATERAL REGARDLESS OF NOTICE OF SALE HAVING BEEN GIVEN.  THE
COLLATERAL AGENT MAY ADJOURN ANY PUBLIC OR PRIVATE SALE FROM TIME TO TIME BY
ANNOUNCEMENT AT THE TIME AND PLACE FIXED THEREFOR, AND SUCH SALE MAY, WITHOUT
FURTHER NOTICE, BE MADE AT THE TIME AND PLACE TO WHICH IT WAS SO ADJOURNED.

 

(B)           ANY CASH HELD BY OR ON BEHALF OF THE COLLATERAL AGENT AND ALL CASH
PROCEEDS RECEIVED BY OR ON BEHALF OF THE COLLATERAL AGENT IN RESPECT OF ANY SALE
OF, COLLECTION FROM, OR OTHER REALIZATION UPON ALL OR ANY PART OF THE ADDITIONAL
COLLATERAL SHALL BE HELD BY THE COLLATERAL AGENT AS COLLATERAL FOR, AND/OR THEN
OR AT ANY TIME THEREAFTER APPLIED (AFTER PAYMENT OF ANY AMOUNTS PAYABLE TO THE
COLLATERAL AGENT PURSUANT TO SECTION 17) IN WHOLE OR IN PART BY THE COLLATERAL
AGENT FOR THE  BENEFIT OF THE SECURED PARTIES AGAINST, ALL OR ANY PART OF THE
SECURED OBLIGATIONS IN THE FOLLOWING ORDER: (I) FIRST, ON A PARI PASSU BASIS, TO
ALL SECURED OBLIGATIONS (EXCLUDING SECURED OBLIGATIONS ARISING UNDER THE TERMS
OF ANY CREDIT FACILITY HEDGING AGREEMENTS) COMPARING (1) THE AGGREGATE PRINCIPAL
AMOUNT OF THE THEN OUTSTANDING TERM LOANS UNDER THE TERM LOAN AGREEMENT TO
(2) THE AMOUNT OF THE THEN EFFECTIVE AGGREGATE COMMITMENT (AS DEFINED IN THE
REVOLVING LOAN AGREEMENT), IF THE AGGREGATE COMMITMENT HAS NOT BEEN TERMINATED,
OR THE SUM OF THE AGGREGATE PRINCIPAL AMOUNT OF THE THEN OUTSTANDING REVOLVING
LOANS UNDER THE REVOLVING LOAN AGREEMENT AND THE LETTER OF CREDIT EXPOSURE
AMOUNT (AS DEFINED IN THE REVOLVING LOAN AGREEMENT) THEN OUTSTANDING UNDER THE
REVOLVING LOAN AGREEMENT, IF THE AGGREGATE COMMITMENT HAS BEEN TERMINATED;
PROVIDED THAT THE AMOUNTS SET FORTH IN THIS CLAUSE (I) THAT WILL BE GIVEN PARI
PASSU TREATMENT AS SET FORTH ABOVE SHALL BE LIMITED TO AMOUNTS (OF AGGREGATE
COMMITMENTS AND LOANS UNDER THE TERM LOAN AGREEMENT AND AGGREGATE COMMITMENTS OR
LOANS AND LETTER OF CREDIT EXPOSURE AMOUNT UNDER THE REVOLVING CREDIT AGREEMENT,
OR AS APPLICABLE) WHICH WOULD NOT GIVE RISE TO AN EVENT OF DEFAULT ARISING UNDER
SECTION 7.1(D) OF THE TERM LOAN AGREEMENT OR THE REVOLVING CREDIT AGREEMENT AS A
RESULT OF A BREACH OF SECTION 6.1(B) OF THE TERM LOAN AGREEMENT OR THE REVOLVING
CREDIT AGREEMENT, RESPECTIVELY AND, (II) SECOND, ON A PARI PASSU BASIS, TO ALL
SECURED OBLIGATIONS ARISING UNDER THE TERMS OF ANY CREDIT FACILITY HEDGING
AGREEMENTS).  ANY SURPLUS OF SUCH CASH OR CASH PROCEEDS HELD BY OR ON THE BEHALF
OF THE COLLATERAL AGENT AND REMAINING AFTER PAYMENT IN FULL OF ALL THE SECURED
OBLIGATIONS (OTHER THAN CONTINGENT INDEMNIFICATION CLAIMS AS TO WHICH NO DEMAND
HAS BEEN MADE) SHALL BE PAID OVER TO THE APPLICABLE GRANTOR OR TO WHOMSOEVER MAY
BE LAWFULLY ENTITLED TO RECEIVE SUCH SURPLUS.

 

(C)           ALL PAYMENTS RECEIVED BY ANY GRANTOR UNDER OR IN RESPECT OF THE
ADDITIONAL COLLATERAL SHALL BE RECEIVED IN TRUST FOR THE BENEFIT OF THE
COLLATERAL AGENT, SHALL BE SEGREGATED FROM OTHER FUNDS OF SUCH GRANTOR AND SHALL
BE FORTHWITH PAID OVER TO THE COLLATERAL AGENT IN THE SAME FORM AS SO RECEIVED
(WITH ANY NECESSARY INDORSEMENT).

 

(D)           THE COLLATERAL AGENT MAY, WITHOUT NOTICE TO ANY GRANTOR EXCEPT AS
REQUIRED BY LAW AND AT ANY TIME OR FROM TIME TO TIME, CHARGE, SET-OFF AND
OTHERWISE APPLY ALL OR ANY PART OF THE SECURED OBLIGATIONS THEN DUE AND OWING
AGAINST ANY FUNDS HELD WITH RESPECT TO THE ACCOUNT COLLATERAL OR IN ANY OTHER
DEPOSIT ACCOUNT.

 

(E)           IN THE EVENT OF ANY SALE OR OTHER DISPOSITION OF ANY OF THE
INTELLECTUAL PROPERTY COLLATERAL OF ANY GRANTOR, THE GOODWILL SYMBOLIZED BY ANY
TRADEMARKS SUBJECT TO SUCH SALE OR OTHER DISPOSITION SHALL BE INCLUDED THEREIN,
AND SUCH GRANTOR SHALL SUPPLY TO THE COLLATERAL AGENT OR ITS DESIGNEE SUCH
GRANTOR’S KNOW-HOW AND EXPERTISE, AND DOCUMENTS AND THINGS RELATING TO ANY
INTELLECTUAL PROPERTY COLLATERAL SUBJECT TO SUCH SALE OR OTHER DISPOSITION, AND
SUCH GRANTOR’S CUSTOMER LISTS AND OTHER RECORDS AND DOCUMENTS RELATING TO SUCH
INTELLECTUAL PROPERTY COLLATERAL AND TO THE MANUFACTURE, DISTRIBUTION,
ADVERTISING AND SALE OF PRODUCTS AND SERVICES OF SUCH GRANTOR.

 

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

 

Section 17. Indemnity and Expenses.  (a)  Each Grantor agrees to indemnify,
defend and save and hold harmless each Secured Party and each of their
Affiliates and their respective officers, directors, employees, agents and
advisors (each, an “Indemnified Party”) from and against, and shall pay on
demand, any and all actual claims, damages, losses, liabilities and
out-of-pocket expenses (including, without limitation, reasonable fees and
expenses of counsel but excluding special, indirect, punitive or consequential
damages, whether arising in tort, contract or otherwise) that may be incurred by
or asserted or awarded against any Indemnified Party, in each case arising out
of or in connection with or by reason of (including, without limitation, in
connection with any investigation, litigation or proceeding or preparation of a
defense in connection therewith) this Agreement, except to the extent such
claim, damage, loss, liability or expense is found in a final nonappealable
judgment by a court of competent jurisdiction to have resulted from such
Indemnified Party’s gross negligence or willful misconduct.  In the case of an
investigation, litigation or other proceeding to which the indemnity in this
Section 17(a) applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by any Grantor, its
directors, shareholders or creditors or any Indemnified Party or any other
Person, whether or not any Indemnified Party is otherwise a party thereto and
whether or not the Merger is consummated.  The Grantors also agree not to assert
any claim against the Collateral Agent, any Secured Party or any of their
Affiliates, or any of their respective officers, directors, employees, agents
and advisors, on any theory of liability, for special, indirect, consequential
or punitive damages arising out of or otherwise relating to the this Agreement.

 

(B)           EACH GRANTOR AGREES TO PAY ON DEMAND (I) ALL REASONABLE
OUT-OF-POCKET COSTS AND EXPENSES OF THE COLLATERAL AGENT IN CONNECTION WITH THE
PREPARATION, EXECUTION, DELIVERY, ADMINISTRATION, MODIFICATION AND AMENDMENT OF,
OR ANY CONSENT OR WAIVER UNDER, THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION,
THE REASONABLE OUT-OF-POCKET FEES AND EXPENSES OF COUNSEL FOR THE COLLATERAL
AGENT WITH RESPECT THERETO, WITH RESPECT TO ADVISING THE COLLATERAL AGENT AS TO
ITS RIGHTS AND RESPONSIBILITIES, OR THE PERFECTION, PROTECTION OR PRESERVATION
OF RIGHTS OR INTERESTS, UNDER THIS AGREEMENT, WITH RESPECT TO NEGOTIATIONS WITH
ANY GRANTOR OR WITH OTHER CREDITORS OF ANY GRANTOR OR ANY OF ITS SUBSIDIARIES
ARISING OUT OF ANY DEFAULT OR ANY EVENTS OR CIRCUMSTANCES THAT MAY GIVE RISE TO
A DEFAULT AND WITH RESPECT TO PRESENTING CLAIMS IN OR OTHERWISE PARTICIPATING IN
OR MONITORING ANY BANKRUPTCY, INSOLVENCY OR OTHER SIMILAR PROCEEDING INVOLVING
CREDITORS’ RIGHTS GENERALLY AND ANY PROCEEDING ANCILLARY THERETO) AND (II) ALL
COSTS AND EXPENSES OF THE COLLATERAL AGENT AND EACH SECURED PARTY IN CONNECTION
WITH THE ENFORCEMENT OF THIS AGREEMENT, WHETHER IN ANY ACTION, SUIT OR
LITIGATION, OR ANY BANKRUPTCY, INSOLVENCY OR OTHER SIMILAR PROCEEDING AFFECTING
CREDITORS’ RIGHTS GENERALLY (INCLUDING, WITHOUT LIMITATION, THE REASONABLE FEES
AND EXPENSES OF COUNSEL FOR THE COLLATERAL AGENT AND EACH SECURED PARTY WITH
RESPECT THERETO).

 

Section 18. Amendments; Waivers; Additional Grantors; Etc.  (a)  No amendment or
waiver of any provision of this Agreement, and no consent to any departure by
any Grantor herefrom, shall in any event be effective unless the same shall be
in writing and signed by the Collateral Agent, the Term Loan Administrative
Agent and the Revolving Loan Administrative Agent, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.  No failure on the part of the Collateral Agent or any
other Secured Party to exercise, and no delay in exercising any right hereunder,
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right preclude any other or further exercise thereof or the exercise of
any other right.

 

(B)           UPON THE EXECUTION AND DELIVERY BY ANY PERSON OF A SECURITY
AGREEMENT SUPPLEMENT IN SUBSTANTIALLY THE FORM OF EXHIBIT A HERETO (EACH A
“SECURITY AGREEMENT B SUPPLEMENT”), SUCH PERSON SHALL BE REFERRED TO AS AN
“ADDITIONAL GRANTOR” AND SHALL BE AND BECOME A GRANTOR HEREUNDER, AND EACH
REFERENCE IN THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS TO “GRANTOR” SHALL ALSO
MEAN AND BE A REFERENCE TO SUCH ADDITIONAL GRANTOR, EACH REFERENCE IN THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS TO THE “ADDITIONAL COLLATERAL” SHALL ALSO
MEAN AND BE A REFERENCE TO THE ADDITIONAL COLLATERAL GRANTED BY SUCH ADDITIONAL
GRANTOR AND EACH REFERENCE IN THIS AGREEMENT TO A SCHEDULE SHALL ALSO MEAN AND
BE A REFERENCE TO THE SCHEDULES ATTACHED TO SUCH SECURITY AGREEMENT B
SUPPLEMENT.

 

Section 19. Notices, Etc.  All notices and other communications provided for
hereunder shall be in writing (including telecopier) and mailed, telecopied or
otherwise delivered, in the case of the Borrower or the Collateral Agent,
addressed to it at its address specified in the Revolving Agreements and, in the
case of each Grantor other than the Borrower, addressed to it at its address set
forth opposite such Grantor’s name on the signature pages hereto or on the
signature page to the Security Agreement B Supplement pursuant to which it
became a party hereto; or, as to any party, at such other address as shall be
designated by such party in a written

 

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

 

notice to the other parties.  All such notices and other communications shall,
when mailed, telegraphed or telecopied, be effective when deposited in the
mails, delivered to the telegraph company or transmitted by telecopier,
respectively.  Delivery by telecopier of an executed counterpart of a signature
page to any amendment or waiver of any provision of this Agreement of any
Exhibit hereto to be executed and delivered hereunder shall be effective as
delivery of an original executed counterpart thereof.  As agreed to among the
Borrower, the Collateral Agent and the applicable Secured Parties from time to
time, notices and other communications may also be delivered by e-mail to the
e-mail address of a representative of the applicable Person provided from time
to time by such Person.

 

Section 20. Continuing Security Interest; Assignments under the Loan
Agreements.  This Agreement shall create a continuing security interest in the
Additional Collateral and shall (a) remain in full force and effect until the
payment in full in cash of the Secured Obligations (other than contingent
indemnification obligations as to which no demand has been made), (b) be binding
upon each Grantor, its successors and assigns and (c) inure, together with the
rights and remedies of the Collateral Agent hereunder, to the benefit of the
Secured Parties and their respective successors, transferees and assigns. 
Without limiting the generality of the foregoing clause (c), any Lender may
assign or otherwise transfer all or any portion of its rights and obligations
under the applicable Loan Agreement(s) (including, without limitation, all or
any portion of the Loans owing to it and the Note or Notes, if any, held by it)
to any other Person, and such other Person shall thereupon become vested with
all the benefits in respect thereof granted to such Lender herein or otherwise.

 

Section 21. Release; Termination.  (a)  Upon any sale, lease, transfer or other
disposition of any item of Additional Collateral of any Grantor in accordance
with the terms of the Loan Documents, the Collateral Agent will, at such
Grantor’s expense, execute and deliver to such Grantor such documents as such
Grantor shall reasonably request to evidence the release of such item of
Additional Collateral from the assignment and security interest granted hereby;
provided, however, that (i) at the time of such request and such release no
Event of Default shall have occurred and be continuing, (ii) such Grantor shall
have delivered to the Collateral Agent, prior to the date of the proposed
release, a written request for release describing the item of Additional
Collateral, together with a form of release for execution by the Collateral
Agent and a certificate of such Grantor to the effect that the transaction is in
compliance with the Loan Documents and as to such other matters as the
Collateral Agent may reasonably request, (iii) the proceeds of any such sale,
lease, transfer or other disposition required to be applied, or any payment to
be made in connection therewith, in accordance with the terms of this Agreement
and (iv) with respect to sales of Equipment and Inventory in the ordinary course
of business and other sales and dispositions that are explicitly permitted by
the Loan Agreements, the Liens granted herein shall be deemed to be released
with no further action on the part of any Person.

 

(B)           UPON THE PAYMENT IN FULL IN CASH OF THE SECURED OBLIGATIONS (OTHER
THAN CONTINGENT INDEMNIFICATION OBLIGATIONS AS TO WHICH NO DEMAND HAS BEEN MADE)
AND THE TERMINATION OF THE AGGREGATE COMMITMENT (AS DEFINED IN EACH OF THE LOAN
AGREEMENTS), THE PLEDGE AND SECURITY INTEREST GRANTED HEREBY SHALL TERMINATE AND
ALL RIGHTS TO THE ADDITIONAL COLLATERAL SHALL REVERT TO THE APPLICABLE GRANTOR. 
UPON ANY SUCH TERMINATION, THE COLLATERAL AGENT WILL, AT THE APPLICABLE
GRANTOR’S EXPENSE, EXECUTE AND DELIVER TO SUCH GRANTOR SUCH DOCUMENTS AS SUCH
GRANTOR SHALL REASONABLY REQUEST TO EVIDENCE SUCH TERMINATION.

 

Section 22. Execution in Counterparts.  This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.  Delivery of
an executed signature page of this Agreement by facsimile transmission or
electronic transmission (i.e., a “pdf” or “tif”) shall be effective as delivery
of an original executed counterpart of this Agreement.

 

Section 23. Jurisdiction; Governing Law, Etc. (a) Each of the parties hereto
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or Federal court of
the United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement or any of the other Loan Documents to which it is a party, 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 any such New York State
court or, to the fullest extent permitted by law, in such Federal court.  Each
of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced

 

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

 

in other jurisdictions by suit on the judgment or in any other manner provided
by law.  Nothing in this Agreement shall affect any right that any party may
otherwise have to bring any action or proceeding relating to this Agreement or
any of the other Loan Documents in the courts of any jurisdiction.

 

(B)           EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES,
TO THE FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION THAT
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 OF THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY IN ANY NEW YORK STATE OR FEDERAL COURT.  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.

 

(C)           THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

 

(d)           EACH OF THE GRANTORS AND THE COLLATERAL AGENT IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER
BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE
LOAN DOCUMENTS, THE LOANS OR THE ACTIONS OF THE AGENT OR ANY LENDER IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

 

[Rest of this page intentionally left blank.]

 

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

 

IN WITNESS WHEREOF, each of the undersigned have caused this Agreement to be
duly executed and delivered by its officer thereunto duly authorized as of the
date first above written.

 

 

 

JPMORGAN CHASE BANK, N.A., AS

 

 

COLLATERAL AGENT

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

WHOLE FOODS MARKET, INC.

 

By:

 

 

 

Name:

 

 

Title:

Address for Notices:

     [OTHER GRANTORS]

 

 

 

 

 

     By:

 

 

 

Name:

 

 

Title:

 

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

 

Schedule I to the
Security Agreement B

 

LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF ORGANIZATION, JURISDICTION OF
ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER

 

Grantor

 

Location

 

Chief
Executive
Office

 

Type of
Organization

 

Jurisdiction
of
Organization

 

Organizational
I.D. No.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

Schedule II to the
Security Agreement B

CHANGES IN NAME, LOCATION, ETC.

 

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

 

Exhibit A to the
Security Agreement B

 

FORM OF SECURITY AGREEMENT B SUPPLEMENT

 

[Date of Security Agreement B Supplement]

 

JPMORGAN CHASE BANK, N.A.,
as the Collateral Agent for the
Secured Parties referred to in the
Loan Agreements  referred to below

 

Attn:

 

WHOLE FOODS MARKET, INC.

 

Ladies and Gentlemen:

 

Reference is made to (i) the Term Loan Agreement dated as of August [  ], 2007
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the “Term Loan Agreement”), among the Borrower, Royal Bank of Canada,
as administrative agent for the lenders from time to time parties thereto,
JPMorgan Chase Bank, N.A., and            as [joint] syndication agent[s],
            as documentation agent,                  as managing agent and RBC
Capital Markets and J. P. Morgan Securities Inc., as joint lead arrangers and
joint bookrunners, (ii)  the Revolving Credit Loan Agreement dated as of
August [  ], 2007 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Revolving Loan Agreement”), among the Borrower,
JPMorgan Chase Bank, N.A., as administrative agent for the lenders from time to
time parties thereto, Royal Bank of Canada, as syndication agents, and J. P.
Morgan Securities Inc. and RBC Capital Markets, as joint lead arrangers and
joint bookrunners, and (iii) the Security Agreement B dated [           
       ], 2007 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Security Agreement B”) made by the Grantors
from time to time party thereto in favor of JPMorgan Chase Bank, N.A. as
collateral agent (together with any successor collateral agent, the “Collateral
Agent”) for the Secured Parties under the Term Loan Agreement and the Revolving
Loan Agreement (the Term Loan Agreement and the Revolving Loan Agreement being
sometimes hereinafter collectively referred to as the “Loan Agreements”).  Terms
defined in the Loan Agreements or the Security Agreement B and not otherwise
defined herein are used herein as defined in the Loan Agreements or the Security
Agreement B.

 

SECTION 1.  Grant of Security.  The undersigned hereby grants to the Collateral
Agent, for the ratable benefit of the Secured Parties under the Loan Documents,
a security interest in, all of its right, title and interest in and to all of
the Additional Collateral of the undersigned, whether now owned or hereafter
acquired by the undersigned, wherever located and whether now or hereafter
existing or arising, including, without limitation, the property and assets of
the undersigned set forth on the attached supplemental schedules to the
Schedules to the Security Agreement B.

 

SECTION 2.  Security for Obligations.  The grant of a security interest in the
Additional Collateral by the undersigned under this Security Agreement B
Supplement and the Security Agreement B secures the payment of all Indebtedness
and other obligations of the undersigned now or hereafter existing under or in
respect of the Loan Documents, whether direct or indirect, absolute or
contingent, and whether for principal, reimbursement obligations, interest,
premiums, penalties, fees, indemnifications, contract causes of action, costs,
expenses or otherwise.  Without limiting the generality of the foregoing, this
Security Agreement B Supplement and the Security Agreement B secure the payment
of all amounts that constitute part of the Secured Obligations and that would be
owed by the undersigned to any Secured Party under the Loan Documents but for
the fact that such

 

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

 

Secured Obligations are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving a Loan Party.

 

SECTION 3.  Supplements to Security Agreement B Schedules.  The undersigned has
attached hereto supplemental Schedules I and II to Schedules I and II,
respectively, to the Security Agreement B, and the undersigned hereby certifies,
as of the date first above written, that such supplemental schedules have been
prepared by the undersigned in substantially the form of the equivalent
Schedules to the Security Agreement B and are complete and correct.

 

SECTION 4.  Representations and Warranties.  The undersigned hereby makes each
representation and warranty set forth in Section 4 of the Security Agreement B
(as supplemented by the attached supplemental schedules) to the same extent as
each other Grantor.

 

SECTION 5.  Obligations Under the Security Agreement B.  The undersigned hereby
agrees, as of the date first above written, to be bound as a Grantor by all of
the terms and provisions of the Security Agreement B to the same extent as each
of the other Grantors.  The undersigned further agrees, as of the date first
above written, that each reference in the Security Agreement B to an “Additional
Grantor” or a “Grantor” shall also mean and be a reference to the undersigned.

 

SECTION 6.  Governing Law.  This Security Agreement B Supplement shall be
governed by, and construed in accordance with, the laws of the State of New
York.

 

 

 

Very truly yours,

 

 

 

 

 

 

[NAME OF ADDITIONAL GRANTOR]

 

 

 

 

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

Address for notices:

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

Schedule 1.1(a)

Disclosed Divestitures

 

Part A

 

1.             Sale of Henry’s and Sun Harvest stores, and related Southern
California distribution center.

 

Part B

 

2.             Divestiture of such of the Wild Oats stores as may be mandated by
the FTC/DOJ in connection with their legal challenge to consummation of the
Transactions.

 

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

 

NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

Schedule 1.1(b)

 

EBIT/EBITDA

(in millions)

 

For the Fiscal Quarter ending on 1/14/07

 

·      EBIT shall be:  $95.2

·      EBITDA shall be:  $154.4

 

For the Fiscal Quarter ending on 4/08/07

 

·      EBIT shall be:  $86.1

·      EBITDA shall be:  $135.2

 

For the Fiscal Quarter ending on 6/01/07

 

·      EBIT shall be:  $89.5

·      EBITDA shall be:  $138.2

 

2

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

 

NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

Schedule 1.1(c)

Guarantors

 

[*CONFIDENTIAL*]

 

ALLEGRO COFFEE COMPANY, A COLORADO CORPORATION

 

MRS. GOOCH’S NATURAL FOOD MARKETS, INC., A CALIFORNIA CORPORATION

 

NATURE’S HEARTLAND, INC., A MASSACHUSETTS CORPORATION

 

THE SOURDOUGH, A EUROPEAN BAKERY, INC., A TEXAS CORPORATION

 

WFM BEVERAGE CORP., A TEXAS CORPORATION

 

WFM BEVERAGE HOLDING COMPANY, A TEXAS CORPORATION

 

WFM GIFT CARD, LLC, A VIRGINIA LIMITED LIABILITY COMPANY

 

WFM HAWAII, LLC, A HAWAII LIMITED LIABILITY COMPANY

 

WFM IP INVESTMENTS, INC., A DELAWARE CORPORATION

 

WFM IP MANAGEMENT, INC., A DELAWARE CORPORATION

 

WFM NORTHERN NEVADA, INC., A DELAWARE CORPORATION

 

WFM PRIVATE LABEL MANAGEMENT, INC., A DELAWARE CORPORATION

 

WFM PRIVATE LABEL, L.P., A DELAWARE LIMITED PARTNERSHIP

 

WFM PROCUREMENT INVESTMENTS, INC., A DELAWARE CORPORATION

 

WFM PROPERTIES SCOTTSDALE, LLC, A DELAWARE LIMITED LIABILITY COMPANY

 

WFM PROPERTIES, L.P., A TEXAS LIMITED PARTNERSHIP

 

WFM PURCHASING MANAGEMENT, INC., A DELAWARE CORPORATION

 

WFM PURCHASING, L.P., A DELAWARE LIMITED PARTNERSHIP

 

WFM SELECT FISH, INC., A DELAWARE CORPORATION

 

WFM SOUTHERN NEVADA, INC., A DELAWARE CORPORATION

 

WFMI MERGER CO., A DELAWARE CORPORATION

 

3

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NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

WHOLE FOOD COMPANY, INC., A LOUISIANA CORPORATION

 

WHOLE FOODS MARKET BRAND 365, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY

 

WHOLE FOODS MARKET CALIFORNIA, INC., A CALIFORNIA CORPORATION

 

WHOLE FOODS MARKET DISTRIBUTION, INC., A DELAWARE CORPORATION

 

WHOLE FOODS MARKET FINANCE, INC., A DELAWARE CORPORATION

 

WHOLE FOODS MARKET GROUP, INC., A DELAWARE CORPORATION

 

WHOLE FOODS MARKET IP, L.P., A DELAWARE LIMITED PARTNERSHIP

 

WHOLE FOODS MARKET PACIFIC NORTHWEST, INC., A DELAWARE CORPORATION

 

WHOLE FOODS MARKET PROCUREMENT, INC., A DELAWARE CORPORATION

 

WHOLE FOODS MARKET ROCKY MOUNTAIN/SOUTHWEST I, INC., A DELAWARE CORPORATION

 

WHOLE FOODS MARKET ROCKY MOUNTAIN/SOUTHWEST, L.P., A TEXAS LIMITED PARTNERSHIP

 

WHOLE FOODS MARKET SERVICES, INC., A DELAWARE CORPORATION

 

WHOLE FOODS MARKET SOUTHWEST INVESTMENTS, INC., A DELAWARE CORPORATION

 

4

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

 

NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

SCHEDULE 1.1 (d)

EXISTING LETTERS OF CREDIT

 

I.              WHOLE FOODS MARKET, INC.

 

LOC #

 

ISSUER

 

BENEFICIARY

 

AMOUNT

 

EXPIRATION

 

 

 

 

 

 

 

 

 

 

 

 

 

a.

 

i-463934

 

JPMorgan Chase Bank, N.A.

 

*CONFIDENTIAL*

 

*CONFIDENTIAL*

 

*CONFIDENTIAL*

 

b.

 

SBD-231337

 

JPMorgan Chase Bank, N.A.

 

*CONFIDENTIAL*

 

*CONFIDENTIAL*

 

*CONFIDENTIAL*

 

c.

 

TDTS-636991

 

JPMorgan Chase Bank, N.A.

 

*CONFIDENTIAL*

 

*CONFIDENTIAL*

 

*CONFIDENTIAL*

 

d.

 

TDTS-230794

 

JPMorgan Chase Bank, N.A.

 

*CONFIDENTIAL*

 

*CONFIDENTIAL*

 

*CONFIDENTIAL*

 

 

II.            WILD OATS MARKETS, INC.

 

LOC #

 

ISSUER

 

BENEFICIARY

 

AMOUNT

 

EXPIRATION

 

 

 

 

 

 

 

 

 

 

 

 

 

a.

 

3085815

 

Bank of America

 

Capitol Indemnity
Corporation and/or
Platte River Ins. Co.

 

$

1,075,000.00

 

11/30/2007

 

 

 

 

 

 

 

 

 

 

 

 

 

b.

 

3078322

 

Bank of America

 

Liberty Mutual
Insurance Company

 

$

7,448,000.00

 

9/30/2007

 

 

 

 

 

 

 

 

 

 

 

 

 

c.

 

3076234

 

Bank of America

 

Park Blvd Holdings,
a California Limited
Partnership

 

$

100,000.00

 

11/30/2007

 

 

 

 

 

 

 

 

 

 

 

 

 

d.

 

3076235

 

Bank of America

 

Pinecrest Plaza LLC,
a Florida Ltd
Liability Company

 

$

549,514.00

 

11/30/2007

 

 

 

 

 

 

 

 

 

 

 

 

 

e.

 

3076236

 

Bank of America

 

Travelers Indemnity
Company

 

$

6,035,000.00

 

9/30/2007

 

 

 

 

 

 

 

 

 

 

 

 

 

f.

 

3076237

 

Bank of America

 

Travelers Indemnity
Company

 

$

422,000.00

 

9/30/2007

 

 

5

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NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

Schedule 2.1(a)

Commitments

 

Name of Lender

 

Commitment

 

Commitment
Percentage

 

JPMorgan Chase Bank, N.A.

 

$

50,000,000.00

 

20.0

%

Royal Bank of Canada

 

$

50,000,000.00

 

20.0

%

Wells Fargo Bank, N A

 

$

42,500,000.00

 

17.0

%

LaSalle Bank Midwest, N.A.

 

$

30,000,000.00

 

12.0

%

Wachovia Bank, N.A.

 

$

30,000,000.00

 

12.0

%

Fortis Capital

 

$

20,000,000.00

 

8.0

%

U.S. Bank, National Association

 

$

17,500,000.00

 

7.0

%

Bank of America, N.A.

 

$

10,000,000.00

 

4.0

%

Total

 

$

250,000,000.00

 

100

%

 

6

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NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

Schedule 3.2(e)

Litigation

 

None

 

7

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NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

Schedule 4.8

Subsidiaries

 

[*CONFIDENTIAL*]

 

5.             Allegro Coffee Company, a Colorado corporation

 

[*CONFIDENTIAL*]

 

9.             Fresh & Wild Holding Limited, a company incorporated in England
and Wales

 

10.           Fresh & Wild Limited, a company incorporated in England and Wales
(Parent: Fresh & Wild Holding Limited)

 

11.           Freshlands Holdings Limited, a company incorporated in England and
Wales (Parent: Fresh & Wild Limited)

 

12.           Freshlands Limited, a company incorporated in England and Wales
(Parent: Freshlands Holdings Limited)

 

[*CONFIDENTIAL*]

 

19.           Mrs. Gooch’s Natural Food Markets, Inc., a California corporation

 

20.           Nature’s Heartland, Inc., a Massachusetts corporation (Parent:
Whole Foods Market Group, Inc.)

 

[*CONFIDENTIAL*]

 

26.           The Sourdough, A European Bakery, Inc., a Texas corporation
(Parent: Whole Foods Market Southwest Investments, Inc.)

 

[*CONFIDENTIAL*]

 

28.           WFM Beverage Corp., a Texas corporation (Parent: WFM Beverage
Holding Company)

 

29.           WFM Beverage Holding Company, a Texas corporation

 

[*CONFIDENTIAL*]

 

31.           WFM Gift Card, LLC, a Virginia limited liability company (Parent:
Whole Foods Market Group, Inc.

 

8

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NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

32.           WFM Hawaii, LLC, a Hawaii limited liability company (Parent:
Mrs. Gooch’s Natural Food Markets, Inc.)

 

[*CONFIDENTIAL*]

 

34.           WFM IP Investments, Inc., a Delaware corporation

 

35.           WFM IP Management, Inc., a Delaware corporation

 

36.           WFM Northern Nevada, Inc., a Delaware corporation (Parent: Whole
Foods Market California, Inc.)

 

37.           WFM Private Label Management, Inc., a Delaware corporation
(Parent: Whole Foods Market Procurement, Inc.)

 

38.           WFM Private Label, L.P., a Delaware limited partnership (General
Partner (0.01%): WFM Private Label Management, Inc.; Limited Partner (99.99%):
WFM Procurement Investments, Inc.)

 

39.           WFM Procurement Investments, Inc., a Delaware corporation (Parent:
Whole Foods Market Procurement, Inc.)

 

[*CONFIDENTIAL*]

 

42.           WFM Properties Holdings, Inc., a Delaware corporation

 

43.           WFM Properties Investments, Inc., a Delaware corporation (Parent:
WFM Properties Holdings, Inc.)

 

44.           WFM Properties Management, Inc., a Delaware corporation (WFM
Properties Holdings, Inc.)

 

[*CONFIDENTIAL*]

 

46.           WFM Properties Scottsdale, LLC, a Delaware limited liability
company (Parent: GBD Properties, Inc.)

 

47.           WFM Properties, L.P., a Texas limited partnership (General Partner
(0.01%): WFM Properties Management, Inc.; Limited Partner (99.99%): WFM
Properties Investments, Inc.)

 

48.           WFM Purchasing Management, Inc., a Delaware corporation (Parent:
Whole Foods Market Procurement, Inc.)

 

9

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

 

NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

49.           WFM Purchasing, L.P., a Delaware limited partnership (General
Partner (0.01%): WFM Purchasing Management, Inc.; Limited Partner (99.99%): WFM
Procurement Investments, Inc.)

 

50.           WFM Select Fish, Inc., a Delaware corporation

 

51.           WFM Southern Nevada, Inc., a Delaware corporation (Parent:
Mrs. Gooch’s Natural Food Markets, Inc.)

 

52.           WFMI Merger Co., a Delaware corporation

 

53.           Whole Food Company, Inc., a Louisiana corporation (Parent: Whole
Foods Market Southwest Investments, Inc.

 

54.           Whole Foods Market Brand 365, LLC, a California limited liability
company (Parent: Whole Foods Market Services, Inc.)

 

55.           Whole Foods Market California, Inc., a California corporation

 

56.           Whole Foods Canada, Inc., a Canada corporation

 

57.           Whole Foods Market Distribution, Inc., a Delaware corporation

 

58.           Whole Foods Market Finance, Inc., a Delaware corporation

 

59.           Whole Foods Market Group, Inc., a Delaware corporation

 

60.           Whole Foods Market IP, L.P., a Delaware limited partnership
(General Partner (0.01%): WFM IP Management, Inc.; Limited Partner (99.99%): WFM
IP Investments, Inc.)

 

61.           Whole Foods Market Pacific Northwest, Inc., a Delaware corporation

 

62.           WHOLE FOODS MARKET PROCUREMENT, INC., A DELAWARE CORPORATION

 

63.           WHOLE FOODS MARKET ROCKY MOUNTAIN/SOUTHWEST I, INC., A DELAWARE
CORPORATION

 

64.           WHOLE FOODS MARKET ROCKY MOUNTAIN/SOUTHWEST, L.P., A TEXAS LIMITED
PARTNERSHIP (GENERAL PARTNER (1%): WHOLE FOODS MARKET ROCKY MOUNTAIN/SOUTHWEST
I, INC.; LIMITED PARTNER (99%): WHOLE FOODS MARKET SOUTHWEST INVESTMENTS, INC.)

 

65.           WHOLE FOODS MARKET SERVICES, INC., A DELAWARE CORPORATION

 

66.           WHOLE FOODS MARKET SOUTHWEST INVESTMENTS, INC., A DELAWARE
CORPORATION

 

10

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

 

NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

67.           YELLOWFRAMES LIMITED, A COMPANY INCORPORATED IN ENGLAND AND WALES
(PARENT: FRESH & WILD LIMITED)

 

11

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NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

Schedule 4.13

Assumed Names

 

Whole Foods Market

 

Fresh Fields

 

Fresh Fields Whole Foods Market

 

Merchant of Vino

 

Whole Foods Market Southwest, L.P.

 

Whole Foods Market Southwest

 

Whole Foods Market Southwest Distribution Center

 

Whole Foods Market Rocky Mountain, L.P.

 

Whole Foods Market Rocky Mountain

 

Whole Hearth

 

12

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NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

Schedule 4.16

Agreements

 

1.             All credit agreements for borrowed money (other than the
indebtedness governed hereby), indentures and capitalized leases and all
Property subject to any Lien securing such Indebtedness or lease obligation

 

None other than as summarized in Company’s SEC filings or with respect to liens
described in Section 6.2(b) through 6.2(i)

 

2.             Letter of credit and guaranty for which the liability or
potential liability of the Company and its Subsidiaries on a consolidated basis
is in excess of $250,000

 

                None other than as summarized in Company’s SEC filings

 

3.             Other material instruments in effect as of the date hereof
providing for, evidencing, securing or otherwise relating to any indebtedness
for borrowed money of the Company or any of its Subsidiaries (other than the
Indebtedness hereunder and Indebtedness secured by Incidental Liens)

 

                None other than as summarized in Company’s SEC filings or with
respect to liens described in Section 6.2(b) through 6.2(i)

 

4.             Obligations of the Company or any of its Subsidiaries to issuers
of appeal bonds issued for account of the Company or any of its Subsidiaries.

 

None

 

13

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NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

Schedule 6.2(a)

Liens

 

Mrs. Gooch Natural Food Markets, Inc.

 

11/26/02; Citicorp Vendor Finance (Equipment Lease); #0233660421

 

Whole Foods Market California, Inc.

 

11/24/02; US Bancorp (Equipment Lease); #0226860364

3/21/05; Robert Reiser & Co. (Equipment Lease); #05-7019828060

6/29/06; United Rentals, Inc. (Equipment Lease); #06-7075949885

5/24/07; Bank of America Leasing & Capital (Equipment Lease); #07-7115128719

5/25/07; Bank of America Leasing & Capital (Equipment Lease) (2 filings);
#07-7115332170

7/23/07; Bank of America Leasing & Capital (Equipment Lease); # 07-7122379816

7/24/07; Bank of America Leasing & Capital (Equipment Lease); #07-7122591034

 

Whole Foods Market Distribution, Inc.

 

12/05/03; Recycle America Alliance, LLC (Equipment Lease); #33194050

 

Whole Foods Market Group, Inc.

 

9/3/02; American Bank Note Company, as agent for USPS (Consignment); #22214041

9/25/02; IBM Credit Corporation (Equipment Lease); #22469553

10/23/02; IBM Credit Corporation (Equipment Lease); #22769119

7/17/03; Patriot Commercial Leasing Co. (Equipment Lease); #30309347

2/28/03; American Bank Note Company, as agent for USPS (Consignment); #30498843

2/5/03; Crown Credit Company (Equipment Lease); #30571797

3/10/03; Crown Credit Company (Equipment Lease); #30576762

2/28/03; Crown Credit Company (Equipment Lease) (2 filings); #30687692,
#30687734

11/13/03; Crown Credit Company (Equipment Lease); #32987553

4/29/04; Crown Credit Company (Equipment Lease); #41198490

9/7/04; Crown Credit Company (Equipment Lease); #42507442

1/20/05; Crown Credit Company (Equipment Lease); #50223173

2/14/05; Crown Credit Company (Equipment Lease); #50494329

2/25/05; Crown Credit Company (Equipment Lease); #50613555

4/12/05; Crown Credit Company (Equipment Lease); #51116608

8/8/05; Crown Credit Company (Equipment Lease) (3 filings); #52438548; 52442847

8/25/05; Crown Credit Company (Equipment Lease); #52647692

3/10/03; US Bancorp (Equipment Lease); #30576762

3/31/03; US Bancorp (Equipment Lease); #30879927

4/28/03; US Bancorp (Equipment Lease); #31260093

 

14

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NOTE: A REQUEST FOR CONFIDENTIAL TREATMENT HAS BEEN MADE WITH RESPECT TO THE
PORTIONS OF THE FOLLOWING DOCUMENT THAT ARE MARKED WITH [*CONFIDENTIAL*].  THE
REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC.

 

11/26/03; US Bancorp (Equipment Lease); #33125294

3/10/04; US Bancorp (Equipment Lease); #30576762

3/16/04; US Bancorp (Equipment Lease); #40729923

9/7/06; US Bancorp (Equipment Lease); #42507442

4/15/03; IOS Capital LLC (Equipment Lease); #30972052

7/27/04; IOS Capital LLC (Equipment Lease); #42162065

3/12/04; Robert Reiser & Co. (Equipment Lease); #4078888

2/11/04; IOS Capital LLC (Equipment Lease); #40511099

3/8/07; IOS Capital LLC (Equipment Lease); #0867464

1/8/04; Konica Minolta Business Solutions (Equipment Lease); #40044737

4/1/05; Greater Bay Bank (Equipment Lease); #50993692

10/6/04; First Access (Equipment Lease); #42808394

8/30/05; Robert Reiser & Co. (Equipment Lease); #52688258

7/28/06; Robert Reiser & Co. (Equipment Lease); #62611614

12/14/06; Robert Reiser & Co. (Equipment Lease); #64372520

3/20/07; Robert Reiser & Co. (Equipment Lease); #1028397

9/7/05; Citicapital Technology Finance (Equipment Lease); #52762764

9/23/05; Citicapital Technology Finance (Equipment Lease); #52996289

5/30/06; NMHG Financial Services (Equipment Lease); #61817121

 

Whole Foods Market, Inc.

 

6/10/04; Crown Credit Company (Equipment Lease); #04-0070989027

6/15/04; Crown Credit Company (Equipment Lease) (2 filings); #04-0071408034,
#04-0071408145

6/21/04; Crown Credit Company (Equipment Lease) (2 filings); #04-0072049804,
#04-0072062556

6/24/04; Crown Credit Company (Equipment Lease); #04-0072582240

6/29/04; Crown Credit Company (Equipment Lease); #04-0072992124

10/14/04; Crown Credit Company (Equipment Lease); #04-0085079881

10/25/04; Crown Credit Company (Equipment Lease); #04-0086111233

5/23/05; Crown Credit Company (Equipment Lease); #05-0016055860

5/24/05; Crown Credit Company (Equipment Lease) (2 filings); #05-0016243415,
#05-001623526

12/19/05; Crown Credit Company (Equipment Lease); #05-0038612843

3/18/02; NCR Corporation (Equipment Lease); #02-0022852708

4/29/02; NMHG Financial Services (Equipment Lease); #02-0027956536

9/11/03; American Bank Note, as agent for USPS (Consignment); #04-0041483498

9/30/05; IBM Credit (Equipment Lease); #05-0030547216

6/26/07; US Express Leasing (Equipment Lease); #07-0021504998

 

Allegro Coffee Company, Inc.

 

2/11/05; Air Liquide Industrial US, LP (Equipment Lease); #20052016259

 

15

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