Exhibit 10.1

 

AMENDED AND RESTATED

CREDIT AGREEMENT

 

 

 

Dated as of November 12, 2003

 

 

 

among

 

LA QUINTA PROPERTIES, INC.
as Borrower,

 

LA QUINTA CORPORATION,
as a Guarantor,

 

THE LENDERS LISTED HEREIN,

as Lenders,

 

CANADIAN IMPERIAL BANK OF COMMERCE,

as Administrative Agent,

 

FLEET SECURITIES INC.,

as Syndication Agent,

 

and

 

CREDIT LYONNAIS NEW YORK BRANCH,

as Documentation Agent

 

CIBC WORLD MARKETS CORP.
and FLEET SECURITIES INC.,
as Co-Lead Arrangers

 

 

 

 

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SECTION 1.

DEFINITIONS

 

 

 

 

1.1

Certain Defined Terms

 

 

 

 

1.2

Accounting Terms; Utilization of GAAP for Purposes of Calculations Under
Agreement

 

 

 

 

1.3

Other Definitional Provisions and Rules of Construction

 

 

 

 

SECTION 2.

AMOUNTS AND TERMS OF COMMITMENTS AND LOANS

 

 

 

 

2.1

Commitments; Making of Loans; Optional Notes

 

 

 

 

2.2

Interest on the Loans

 

 

 

 

2.3

Fees

 

 

 

 

2.4

Repayments and Prepayments; General Provisions Regarding Payments; Application
of Proceeds of Collateral and Payments Under Subsidiary Guaranty

 

 

 

 

2.5

Use of Proceeds

 

 

 

 

2.6

Special Provisions Governing LIBOR Loans

 

 

 

 

2.7

Increased Costs; Taxes; Capital Adequacy

 

 

 

 

2.8

Obligation of Lenders and Issuing Lenders to Mitigate

 

 

 

 

2.9

Replacement of a Lender

 

 

 

 

2.10

Limitation on Interest

 

 

 

 

SECTION 3.

LETTERS OF CREDIT

 

 

 

 

3.1

Issuance of Letters of Credit and Lenders’ Purchase of Participations Therein

 

 

 

 

3.2

Letter of Credit Fees

 

 

 

 

3.3

Drawings and Reimbursement of Amounts Paid Under Letters of Credit

 

 

 

 

3.4

Obligations Absolute

 

 

 

 

3.5

Indemnification; Nature of Issuing Lenders’ Duties

 

 

 

 

3.6

Increased Costs and Taxes Relating to Letters of Credit

 

 

 

 

SECTION 4.

CONDITIONS TO LOANS AND LETTERS OF CREDIT

 

 

 

 

4.1

Conditions to Effective Date

 

 

 

 

4.2

Conditions to All Loans

 

 

 

 

4.3

Conditions to Letters of Credit

 

 

 

 

SECTION 5.

BORROWER’S AND HOLDINGS’ REPRESENTATIONS AND WARRANTIES

 

 

i

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5.1

Organization, Powers, Qualification, Good Standing, Business and Subsidiaries

 

 

 

 

5.2

Authorization of Borrowing, etc

 

 

 

 

5.3

Financial Condition

 

 

 

 

5.4

No Material Adverse Change

 

 

 

 

5.5

Title to Properties; Liens; Real Property

 

 

 

 

5.6

Litigation; Adverse Facts

 

 

 

 

5.7

Payment of Taxes

 

 

 

 

5.8

Performance of Agreements; Materially Adverse Agreements; Material Contracts

 

 

 

 

5.9

Governmental Regulation

 

 

 

 

5.10

Securities Activities

 

 

 

 

5.11

Employee Benefit Plans

 

 

 

 

5.12

No Broker’s Fees

 

 

 

 

5.13

Environmental Protection

 

 

 

 

5.14

Employee Matters

 

 

 

 

5.15

Solvency

 

 

 

 

5.16

Matters Relating to Collateral

 

 

 

 

5.17

Disclosure

 

 

 

 

5.18

REIT Status

 

 

 

 

5.19

Insurance

 

 

 

 

SECTION 6.

BORROWER’S AND HOLDINGS’ AFFIRMATIVE COVENANTS

 

 

 

 

6.1

Financial Statements and Other Reports

 

 

 

 

6.2

Corporate Existence, etc

 

 

 

 

6.3

Payment of Taxes and Claims; Tax Consolidation

 

 

 

 

6.4

Maintenance of Properties; Insurance

 

 

 

 

6.5

Inspection Rights Lender Meeting

 

 

 

 

6.6

Compliance with Laws, etc

 

 

 

 

6.7

Environmental Review and Investigation, Disclosure, Etc.; Borrower’s Actions
Regarding Hazardous Materials Activities, Environmental Claims and Violations of
Environmental Laws

 

 

 

 

6.8

Execution of Subsidiary Guaranty and Personal Property Collateral Documents by
Certain Subsidiaries and Future Subsidiaries

 

 

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SECTION 7.

BORROWER’S AND HOLDINGS’ NEGATIVE COVENANTS

 

 

 

 

7.1

Indebtedness

 

 

 

 

7.2

Liens and Related Matters

 

 

 

 

7.3

Investments; Joint Ventures

 

 

 

 

7.4

Contingent Obligations

 

 

 

 

7.5

Restricted Payments

 

 

 

 

7.6

Financial Covenants

 

 

 

 

7.7

Restriction on Fundamental Changes; Asset Sales and Acquisitions

 

 

 

 

7.8

Capital Expenditures

 

 

 

 

7.9

Disposal of Subsidiary Stock

 

 

 

 

7.10

Conduct of Business

 

 

 

 

7.11

Amendments or Waivers of Related Agreements

 

 

 

 

7.12

Fiscal Year

 

 

 

 

7.13

Public Company

 

 

 

 

7.14

Transactions with Affiliates

 

 

 

 

SECTION 8.

EVENTS OF DEFAULT

 

 

 

 

8.1

Failure to Make Payments When Due

 

 

 

 

8.2

Default in Other Agreements

 

 

 

 

8.3

Breach of Certain Covenants

 

 

 

 

8.4

Breach of Warranty

 

 

 

 

8.5

Other Defaults Under Loan Documents

 

 

 

 

8.6

Involuntary Bankruptcy; Appointment of Receiver, etc

 

 

 

 

8.7

Voluntary Bankruptcy; Appointment of Receiver, etc

 

 

 

 

8.8

Judgments and Attachments

 

 

 

 

8.9

Dissolution

 

 

 

 

8.10

Employee Benefit Plans

 

 

 

 

8.11

Change in Control

 

 

 

 

8.12

Invalidity of Subsidiary Guaranty; Failure of Security; Repudiation of
Obligations

 

 

 

 

8.13

Material Adverse Effect

 

 

 

 

SECTION 9.

HOLDINGS GUARANTY

 

 

 

 

9.1

Guaranty

 

 

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9.2

Guaranty Absolute; Continuing Guaranty

 

 

 

 

9.3

Actions by Beneficiaries

 

 

 

 

9.4

No Discharge

 

 

 

 

9.5

Waivers

 

 

 

 

9.6

Holdings’ Rights of Subrogation, Contribution, Etc.; Subordination of Other
Obligations

 

 

 

 

9.7

Financial Condition of Borrower

 

 

 

 

9.8

Set Off

 

 

 

 

9.9

Notice of Lender Hedge Agreements

 

 

 

 

SECTION 10.

ADMINISTRATIVE AGENT

 

 

 

 

10.1

Appointment

 

 

 

 

10.2

Powers and Duties; General Immunity

 

 

 

 

10.3

Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness

 

 

 

 

10.4

Right to Indemnity

 

 

 

 

10.5

Successor Administrative Agent

 

 

 

 

10.6

Collateral Documents and Guaranties

 

 

 

 

SECTION 11.

MISCELLANEOUS

 

 

 

 

11.1

Assignments and Participations in Loans

 

 

 

 

11.2

Expenses

 

 

 

 

11.3

Indemnity

 

 

 

 

11.4

Set-Off

 

 

 

 

11.5

Ratable Sharing

 

 

 

 

11.6

Amendments and Waivers

 

 

 

 

11.7

Independence of Covenants

 

 

 

 

11.8

Notices

 

 

 

 

11.9

Survival of Representations, Warranties and Agreements

 

 

 

 

11.10

Failure or Indulgence Not Waiver; Remedies Cumulative

 

 

 

 

11.11

Marshalling; Payments Set Aside

 

 

 

 

11.12

Severability

 

 

 

 

11.13

Obligations Several; Independent Nature of Lenders’ Rights

 

 

 

 

11.14

Headings

 

 

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11.15

Applicable Law

 

 

 

 

11.16

Successors and Assigns

 

 

 

 

11.17

Consent to Jurisdiction and Service of Process

 

 

 

 

11.18

Waiver of Jury Trial

 

 

 

 

11.19

Confidentiality

 

 

 

 

11.20

Co-Lead Arrangers; Syndication Agent; Documentation Agent

 

 

 

 

11.21

Counterparts; Effectiveness

 

 

 

 

 

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LA QUINTA PROPERTIES, INC.

 

AMENDED AND RESTATED
CREDIT AGREEMENT

 

This AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”) is dated as of
November 12, 2003 and entered into by and among LA QUINTA PROPERTIES, INC.
(formerly known as Meditrust Corporation), a Delaware corporation, as borrower
(“Borrower”), LA QUINTA CORPORATION (formerly known as Meditrust Operating
Company), a Delaware corporation, as a guarantor (“Holdings”), THE FINANCIAL
INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF (each individually referred to
herein as a “Lender” and collectively as “Lenders”), CANADIAN IMPERIAL BANK OF
COMMERCE, acting through one or more of its agencies, branches or affiliates
(“CIBC”), as administrative agent for Lenders (in such capacity, “Administrative
Agent”), Fleet Securities Inc., acting through one or more of its branches or
affiliates (“Fleet”), as syndication agent (in such capacity, “Syndication
Agent”), and Credit Lyonnais New York Branch, as documentation agent (in such
capacity, “Documentation Agent”).

 

R E C I T A L S

 

WHEREAS, Borrower, Holdings, Administrative Agent, Syndication Agent,
Documentation Agent and certain of the Lenders are party to that certain Credit
Agreement dated as of June 6, 2001 (as amended through the date hereof, the
“Existing Credit Agreement”);

 

WHEREAS, Borrower, Holdings, Administrative Agent, Syndication Agent,
Documentation Agent and Lenders desire to amend and restate the Existing Credit
Agreement to provide for Holdings becoming a guarantor of the Obligations of
Borrower hereunder, to extend the maturity date of the Existing Credit
Agreement, to modify certain of the covenants contained in the Existing Credit
Agreement and to make certain other modifications to the Existing Credit
Agreement, all as more specifically set forth herein;

 

WHEREAS, Borrower desires to continue to secure all of the Obligations hereunder
and under the other Loan Documents with a First Priority Lien on certain
personal property consisting of a pledge of all of the capital stock of each of
its Subsidiaries (except to the extent excluded by the terms of the Collateral
Documents), certain intercompany notes and certain mortgage loans; and

 

WHEREAS, Holdings and certain of the Subsidiaries of Holdings have agreed to
guarantee or continue to guarantee the Obligations hereunder and under the other
Loan Documents and to continue to secure their guaranties by granting to
Administrative Agent, for the benefit of Lenders, a First Priority Lien on
certain personal property consisting of a pledge of all of the capital stock of
each of their respective Subsidiaries (except to the extent excluded by the
terms of the Collateral Documents), certain intercompany notes and certain
mortgage loans;

 

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NOW, THEREFORE, in consideration of the premises and the agreements, provisions
and covenants herein contained, Borrower, Holdings, Lenders, Administrative
Agent, Syndication Agent and Documentation Agent agree as follows:

 

Section 1.              DEFINITIONS

 

1.1                               Certain Defined Terms.

 

The following terms used in this Agreement shall have the following meanings:

 

“Adjusted LIBOR” means, for any Interest Rate Determination Date with respect to
an Interest Period for a LIBOR Loan, the rate per annum obtained by dividing (x)
the rate of interest equal to (a) the rate per annum determined on the basis of
the rate for deposits in Dollars for a period equal to such Interest Period
commencing on the first day of such Interest Period and appearing on Telerate
Screen 3750 at or about 11:00 A.M., London time, two Business Days prior to the
commencement of such Interest Period, or (b) if such a rate does not appear on
Telerate Screen 3750, the average of the rates per annum at which Dollar
deposits in immediately available funds are offered to CIBC in the interbank
LIBOR market as at or about 11:00 A.M. (New York City time) two Business Days
prior to the beginning of such Interest Period for delivery on the first day of
such Interest Period, and for a period approximately equal to such Interest
Period, by (y) a percentage equal to 100% minus the stated maximum rate
(expressed as a percentage) of all reserve requirements (including any marginal,
emergency, supplemental, special or other reserves) applicable on such Interest
Rate Determination Date to any member bank of the Federal Reserve System in
respect of “Eurocurrency liabilities” as defined in Regulation D (or any
successor category of liabilities under Regulation D), it being acknowledged
that, as of the date hereof, such reserve requirement is equal to zero (0).

 

“Administrative Agent” has the meaning assigned to that term in the introduction
to this Agreement and also means and includes any successor Administrative Agent
appointed pursuant to subsection 10.5.

 

“Administrative Agent’s Office” means (i) the office of Administrative Agent
located at 425 Lexington Avenue, New York, NY 10017, or (ii) such other office
of Administrative Agent as may from time to time hereafter be designated as such
in a written notice delivered by Administrative Agent to Borrower and each
Lender.

 

“Affected Lender” has the meaning assigned to that term in subsection 2.6C.

 

“Affected Loans” has the meaning assigned to that term in subsection 2.6C.

 

“Affiliate”, as applied to any Person, means any other Person that, (i) directly
or indirectly through one or more intermediaries, controls, or is controlled by,
or is under common control with, such given Person, (ii) directly or indirectly
beneficially owns or holds 10% or, in the case of a Franchisee, 25% or more of
any class of voting stock or partnership or membership or other voting interest
of such Person or any Subsidiary of such Person, or (iii) 10% or, in the case of
a Franchisee, 25% or more of the voting stock or partnership or membership or
other voting interest of which is directly or indirectly beneficially owned or

 

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held by such Person or a Subsidiary of such Person.  For the purposes of this
definition, “control” (including, with correlative meanings, the terms
“controlling”, “controlled by” and “under common control with”), as applied to
any Person, means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of that Person, whether
through the ownership of voting Securities or by contract or otherwise.

 

“Agreement” means this Amended and Restated Credit Agreement dated as of
November 12 , 2003.

 

“Allocation Letter” means a letter from Administrative Agent to each Lender and
Borrower setting forth such Lender’s Commitment and Pro Rata Share, as the same
may be modified from time to time thereafter pursuant to this Agreement.

 

“Annual CapEx Amount” is defined in subsection 7.8A.

 

“Applicable Base Rate Margin” means, as at any date of determination, with
respect to Revolving Loans that are Base Rate Loans, a percentage per annum as
set forth below opposite the applicable Total Leverage Ratio:

 

Total Leverage Ratio

 

Applicable Base Rate Margin

 

greater than or equal to 4.00:1.00

 

1.50

%

 

 

 

 

less than 4.00:1.00  but greater than or equal to 3.50:1.00

 

1.25

%

 

 

 

 

less than 3.50:1.00

 

1.00

%

 

; provided that from and after the Effective Date until the date that is three
Business Days after the date on which Borrower delivers the Margin Determination
Certificate required to be delivered to Administrative Agent pursuant to
subsection 6.1(xi) for the Fiscal Quarter ending September 30, 2003, the
Applicable Base Rate Margin for Revolving Loans that are Base Rate Loans shall
be 1.50% per annum.

 

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“Applicable LIBOR Margin” means, with respect to Revolving Loans that are LIBOR
Loans, a percentage per annum as set forth below opposite the applicable Total
Leverage Ratio:

 

Total Leverage Ratio

 

Applicable LIBOR Margin

 

greater than or equal to 4.00:1.00

 

3.00

%

 

 

 

 

less than 4.00:1.00  but greater than or equal to 3.50:1.00

 

2.75

%

 

 

 

 

less than 3.50:1.00

 

2.50

%

 

 

; provided from and after the Effective Date until the date that is three
Business Days after the date on which Borrower delivers the Margin Determination
Certificate required to be delivered to Administrative Agent pursuant to
subsection 6.1(xi) for the Fiscal Quarter ending September 30, 2003, the
Applicable LIBOR Margin for Revolving Loans that are LIBOR Loans shall be 3.00%
per annum.

 

“Approved Fund” means any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.

 

“Asset Sale” means (x) the securitization including, without limitation, the
securitization of Lodging Assets in connection with any transaction permitted
pursuant to subsection 7.1(iv) or (y) the sale (in any single transaction or
related series of transactions) by Holdings or any of its Subsidiaries to any
Person other than Holdings, Borrower or any Subsidiary Guarantor of (i) any of
the capital stock or other equity or ownership interests of any Subsidiary of
Holdings, (ii) substantially all of the assets of any division or line of
business of Holdings or any of its Subsidiaries, or (iii) any other assets
(whether tangible or intangible) of Holdings or any of its Subsidiaries (other
than (a) dispositions of worn-out and obsolete equipment no longer useful in
Holdings’ or any Subsidiary’s business, consistent with past practices of
Holdings or such Subsidiary), (b) dispositions of Lodging Assets (other than
Lodging Assets subject to securitization under subsection 7.1(iv)) and (c) sales
of other assets to the extent that the aggregate value of such assets does not
exceed $5,000,000 in any Fiscal Year).

 

“Assignment Agreement” means an Assignment Agreement in substantially the form
of Exhibit VIII annexed hereto.

 

“Available Basket Amount” means as at any date of determination, an amount equal
to $36,000,000 minus the aggregate amount of all Permitted Reinvestment Capital
Expenditures made with respect to one or more Real Property Assets to the extent
such Permitted Reinvestment Capital Expenditures exceed the amount of casualty
loss insurance

 

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proceeds or eminent domain proceeds (or proceeds from a sale in lieu thereof)
actually received with respect thereto.

 

“Bankruptcy Code” means Title 11 of the United States Code entitled
“Bankruptcy”, as now and hereafter in effect, or any successor statute.

 

“Base Rate” means, at any time, the higher of (x) the Reference Rate or (y) the
rate which is one half of 1% in excess of the Federal Funds Effective Rate.

 

“Base Rate Loans” means Loans bearing interest at rates determined by reference
to the Base Rate as provided in subsection 2.2A.

 

“Borrower” has the meaning assigned to that term in the introduction to this
Agreement.

 

“Business Day” means (i) any day excluding Saturday, Sunday and any day which is
a legal holiday under the laws of the State of New York or is a day on which
banking institutions located in such state are authorized or required by law or
other governmental action to close, and (ii) with respect to all notices,
determinations, fundings and payments in connection with the Adjusted LIBOR or
any LIBOR Loan, any day that (a) is a Business Day described in clause (i)
above, and (b) is a day for trading by and between banks in Dollar deposits in
the London interbank market.

 

“Capital Expenditures” means, for any period, the sum of (i) the aggregate of
all expenditures (paid in Cash or other consideration and including that portion
of Capital Leases which is capitalized on the consolidated balance sheet of
Holdings and its Subsidiaries) by Holdings and its Subsidiaries during that
period that, in conformity with GAAP, are included in “additions to property,
plant or equipment” or comparable items reflected in the consolidated statement
of cash flows of Holdings and its Subsidiaries plus (ii) to the extent not
covered by clause (i) of this definition, the aggregate of all expenditures by
Holdings and its Subsidiaries during that period to acquire (by purchase or
otherwise) the business, property or fixed assets of any Person, or the capital
stock or other evidence of beneficial ownership of any Person that, as a result
of such acquisition, becomes or remains a Subsidiary of Holdings; provided,
however, that Capital Expenditures shall not include any expenditures for
Investments permitted under subsection 7.3(i).

 

“Capital Expenditure Reserve” means, for any period, as at any date of
determination, an amount equal to 5.00% of net room revenues generated by
Lodging Assets for such period, as determined on a Pro Forma Basis.

 

“Capital Lease”, as applied to any Person, means any lease of any property
(whether real, personal or mixed) by that Person as lessee that, in conformity
with GAAP, is accounted for as a capital lease on the balance sheet of that
Person.

 

“Cap Rate” means 12% initially as such rate may be adjusted from time to time
upon the mutual agreement of Borrower and Administrative Agent.

 

“Cash” means money, currency or a credit balance in a Deposit Account.

 

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“Cash Equivalents” means, as at any date of determination, (i) securities issued
or directly and fully guaranteed or insured by the United States government or
any agency or instrumentality thereof or any state having maturities of not more
than one year after the date of acquisition; (ii) certificates of deposit and
Eurodollar time deposits with maturities of one year or less from the date of
acquisition, bankers’ acceptances with maturities not exceeding one year and
overnight bank deposits, in each case with any Lender or any domestic commercial
bank or U.S. branch of a foreign commercial bank having capital and surplus in
excess of $250,000,000 and a Thompson Bank Watch Rating of “B” or better;
(iii) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (i) and (ii) above
entered into with any financial institution meeting the qualifications specified
in said clause (ii); (iv) commercial paper having at least a rating of A by S&P
and/or A2 by Moody’s and in each case maturing within 270 days after the date of
acquisition; (v) real estate loan pool participations, guaranteed by an entity
with an A rating given by S&P or an A2 rating given by Moody’s, or better rated
credit; (vi) shares of any mutual fund or any money market fund, in each case
that has its assets primarily invested in the types of investments referred to
in clauses (i) through (iv); and (vii) for purposes of financial covenant
calculations only, any 7.114% Securities to the extent shown as an asset on the
consolidated balance sheet of Holdings and its Subsidiaries.

 

“Change of Control” means any of the following:  (i) any Person or any Person
acting in concert with one or more other Persons, shall have acquired beneficial
ownership, directly or indirectly, of Securities of Borrower or Holdings (or
other Securities convertible into such Securities) representing 30% or more of
the combined voting power of all Securities of Borrower or Holdings entitled to
vote in the election of members of the Governing Body of Borrower or Holdings,
as the case may be, other than Securities having such power only by reason of
the happening of a contingency; (ii) the occurrence of a change in the
composition of the Governing Body of Borrower or Holdings such that a majority
of the members of any such Governing Body are not Continuing Members; and (iii)
the occurrence of any “Change in Control” or similar provision as defined in any
Senior Note Document, Subordinated Indebtedness or Refinancing Indebtedness.  As
used herein, the term “beneficially own” or “beneficial ownership” shall have
the meanings set forth therefor in the Exchange Act and the rules and
regulations promulgated thereunder.

 

“CIBC” has the meaning assigned to that term in the introduction to this
Agreement.

 

“Closing Date” means June 6, 2001, the date of the closing of the Existing
Credit Agreement.

 

“Collateral” means, collectively, all of the property in which Liens are
purported to be granted pursuant to the Collateral Documents as security for the
Obligations.

 

“Collateral Documents” means the Pledge Agreement and all other instruments or
documents delivered by any Loan Party pursuant to this Agreement or any of the
other Loan Documents in order to grant to Administrative Agent, on behalf of
Lenders and the Senior Notes and any senior Refinancing Indebtedness required to
be equally and ratably secured thereby, a Lien on any Collateral of that Loan
Party as security for the Obligations and such other Indebtedness.

 

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“Commitments” means the commitments of Lenders to make Loans as set forth in
subsection 2.1A.

 

“Compliance Certificate” means a certificate substantially in the form of
Exhibit VI annexed hereto delivered to Administrative Agent by Borrower pursuant
to subsection 6.1(iii).

 

“Consolidated EBITDA” means, for any period, without duplication the sum of the
amounts for such period of (i) Consolidated Net Income, (ii) Consolidated Net
Interest Expense, (iii) provisions for taxes based on income, (iv) total
depreciation expense, (v) total amortization expense (including amortization of
restricted stock), (vi) other non-recurring and non-cash items reducing
Consolidated Net Income, (vii) deferred financing amounts, (viii) FASB 133
adjustments, (ix) non-cash expense related to stock options, (x) the call
premium associated with the redemption of Borrower’s outstanding 7.114% Notes to
the extent reflected in Consolidated Net Income, and (xi) losses arising out of
early extinguishment of debt, less any non-recurring and non-cash items
increasing Consolidated Net Income, all of the foregoing as determined on a
consolidated basis for Holdings and its Subsidiaries (including without
limitation discontinued operations) in conformity with GAAP and to be calculated
on a Pro Forma Basis.

 

“Consolidated Net Income” means, for any period, the net income (or loss)
(before payments of preferred dividends, regardless of how such preferred
dividends are classified on the income statement) of Holdings and its
Subsidiaries on a consolidated basis for such period taken as a single
accounting period determined in conformity with GAAP; provided that there shall
be excluded (i) the income (or loss) of any Person (other than a Subsidiary of
Holdings) in which any other Person (other than Holdings or any of its
Subsidiaries) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to Holdings or any of its
Subsidiaries by such Person during such period, (ii) the income of any
Subsidiary of Holdings to the extent that the declaration or payment of
dividends or similar distributions by that Subsidiary of that income is not at
the time permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary, (iii) any after-tax gains or losses attributable
to sales of assets and (iv) (to the extent not included in clauses (i) through
(iii) above) any net extraordinary gains or net extraordinary losses as
determined in conformity with GAAP.

 

“Consolidated Net Interest Expense” means, for any period, total interest
expense (including that portion attributable to Capital Leases in accordance
with GAAP and interest expense on 7.114% Notes owned by Holdings or any of its
Subsidiaries), net of interest income (including interest income on 7.114%
Securities owned by Holdings or any of its Subsidiaries), on a consolidated
basis in accordance with GAAP (excluding the treatment of derivatives and any
marking-to-market required in connection therewith under FASB 133) for Holdings
and its Subsidiaries with respect to all outstanding Indebtedness, including all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers’ acceptance financing and net costs under Interest Rate
Agreements, but excluding, however, any deferred financing expenses, such as
amounts referred to in subsection 2.3B and payable to Administrative Agent
and/or Lenders.  Consolidated Net Interest Expense shall be calculated on a Pro
Forma Basis.

 

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“Consolidated Net Tangible Assets” means, as at any date of determination, the
aggregate amount of total assets (less applicable reserves and other properly
deductible items) less (i) all current liabilities and (ii) all goodwill, trade
names, trademarks, patents, unamortized debt discount, and expenses and other
like intangibles of Holdings and its Subsidiaries, all as set forth on the most
recent balance sheet of Holdings and its Subsidiaries prepared in accordance
with GAAP.

 

 “Consolidated Tangible Net Worth” means, as at any date of determination, and
without duplication, total shareholders equity of Holdings and its Subsidiaries
on a consolidated basis determined in conformity with GAAP, minus the Intangible
Assets of Holdings and its Subsidiaries on a consolidated basis determined in
conformity with GAAP.  For purposes of this definition, “Intangible Assets”
means with respect to any such intangible assets, the amount (to the extent
reflected in determining such combined consolidated equity) of goodwill,
patents, trademarks, service marks, trade names, copyrights, organization or
developmental expenses, deferred financing fees and other intangible assets.

 

“Contingent Obligation”, as applied to any Person, means without duplication any
direct or indirect liability, contingent or otherwise, of that Person (i) with
respect to any Indebtedness, lease, dividend or other obligation of another if
the primary purpose or intent thereof by the Person incurring the Contingent
Obligation is to provide assurance to the obligee of such obligation of another
that such obligation of another will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
obligation will be protected (in whole or in part) against loss in respect
thereof, (ii) with respect to any letter of credit issued for the account of
that Person or as to which that Person is otherwise liable for reimbursement of
drawings, or (iii) under Hedge Agreements.  Contingent Obligations shall include
without duplication (a) the direct or indirect guaranty, endorsement (otherwise
than for collection or deposit in the ordinary course of business), co-making,
discounting with recourse or sale with recourse by such Person of the obligation
of another, (b) the obligation to make take-or-pay or similar payments if
required regardless of non-performance by any other party or parties to an
agreement, and (c) any liability of such Person for the obligation of another
through any agreement (contingent or otherwise) (X) to purchase, repurchase or
otherwise acquire such obligation or any security therefor, or to provide funds
for the payment or discharge of such obligation (whether in the form of loans,
advances, stock purchases, capital contributions or otherwise) or (Y) to
maintain the solvency or any balance sheet item, level of income or financial
condition of another if, in the case of any agreement described under subclauses
(X) or (Y) of this sentence, the primary purpose or intent thereof is as
described in the preceding sentence.  The amount of any Contingent Obligation
shall be equal to the amount of the obligation so guaranteed or otherwise
supported at any time of determination or, if less, the amount to which such
Contingent Obligation is specifically limited.  Contingent Obligations in
respect of loan obligations shall be determined based on the amount of
outstanding loans and not on the basis of available but unused commitments.

 

“Continuing Member” means, as of any date of determination, any member of the
Governing Body of Borrower or Holdings who (i) was a member of such Governing
Body on the Effective Date or (ii) was nominated for election or elected to such
Governing Body with the affirmative vote of a majority of the members who were
either members of such

 

8

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Governing Body on the Effective Date or whose nomination or election was
previously so approved.

 

“Contractual Obligation”, as applied to any Person, means any provision of any
Security issued by that Person or of any material indenture, mortgage, deed of
trust, contract, undertaking, agreement or other instrument to which that Person
is a party or by which it or any of its properties is bound or to which it or
any of its properties is subject.

 

“Conversion Costs” means those Capital Expenditures made within two years of the
consummation of any Permitted Acquisition to convert any such acquired property
to a La Quinta Inn or a La Quinta Inn & Suites.

 

“Currency Agreement” means any foreign exchange contract, currency swap
agreement, futures contract, option contract, synthetic cap or other similar
agreement or arrangement to which Holdings or any of its Subsidiaries is a
party.

 

“Deposit Account” means a demand, time, savings, passbook or like account with a
bank, savings and loan association, credit union or like organization, other
than an account evidenced by a negotiable certificate of deposit.

 

“Documentation Agent” has the meaning assigned to that term in the recitals.

 

“Dollars” and the sign “$” mean the lawful money of the United States of
America.

 

“Effective Date” means the date on or before December 1, 2003, on which the
conditions set forth in subsection 4.1 are satisfied.

 

“Eligible Assignee” means (A)(i) a commercial bank organized under the laws of
the United States or any state thereof; (ii) a savings and loan association or
savings bank organized under the laws of the United States or any state thereof;
(iii) a commercial bank organized under the laws of any other country or a
political subdivision thereof (provided that (x) such bank is acting through a
branch or agency located in the United States or (y) such bank is organized
under the laws of a country that is a member of the Organization for Economic
Cooperation and Development or a political subdivision of such country);
(iv) any other entity which is an “accredited investor” (as defined in
Regulation D under the Securities Act) which extends credit or buys loans as one
of its businesses including insurance companies, mutual funds, lease financing
companies and investment funds and any Approved Funds; (B) a Lender, an
Affiliate of a Lender, or an Approved Fund; and (C) any other Person (other than
a natural Person) approved by (1) Administrative Agent, (2) in the case of any
assignment of a Revolving Loan, Issuing Lender, and (3) unless (x) such Person
is taking delivery of an assignment in connection with physical settlement of a
credit derivatives transaction, or (y) an Event of Default or Potential Event of
Default has occurred and is continuing, Borrower (each such approval not to be
unreasonably withheld or delayed).  If the consent of Borrower to an assignment
to an Eligible Assignee is required hereunder (including a consent to an
assignment which does not meet the minimum assignment thresholds specified in
subsection 11.1B(i)), Borrower shall be deemed to have given its consent ten
Business Days after the date notice thereof has been delivered by the assigning
Lender (through

 

9

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Administrative Agent) unless such consent is expressly refused by Borrower prior
to such tenth Business Day.

 

“Employee Benefit Plan” means any “employee benefit plan” as defined in Section
3(3) of ERISA which is or was maintained or contributed to by Holdings,
Borrower, any of their Subsidiaries or any of their respective ERISA Affiliates.

 

“Environmental Claim” means any investigation, notice, notice of violation,
claim, action, suit, proceeding, demand, abatement order or other order or
directive (conditional or otherwise), by any governmental authority or any other
Person, arising (i) pursuant to or in connection with any actual or alleged
violation of any Environmental Law, (ii) in connection with any Hazardous
Materials or any actual or alleged Hazardous Materials Activity, or (iii) in
connection with any actual or alleged damage, injury, threat or harm to health,
safety, natural resources or the environment.

 

“Environmental Laws” means any and all current or future statutes, ordinances,
orders, rules, regulations, guidance documents, judgments, Governmental
Authorizations, or any other requirements of governmental authorities relating
to (i) environmental matters, including those relating to any Hazardous
Materials Activity, or (ii) the generation, use, storage, transportation or
disposal of Hazardous Materials, in any manner applicable to Holdings or any of
its Subsidiaries or any Real Property Asset, including the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et
seq.), the Hazardous Materials Transportation Act (49 U.S.C. § 1801 et seq.),
the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the
Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq.), the Clean Air
Act (42 U.S.C. § 7401 et seq.), the Toxic Substances Control Act (15 U.S.C.
§ 2601 et seq.), the Federal Insecticide, Fungicide and Rodenticide Act (7
U.S.C. §136 et seq.), the Occupational Safety and Health Act (29 U.S.C. § 651 et
seq.), the Oil Pollution Act (33 U.S.C. § 2701 et seq.) and the Emergency
Planning and Community Right-to-Know Act (42 U.S.C. § 11001 et seq.), each as
amended or supplemented, any analogous present or future state or local statutes
or laws, and any regulations promulgated pursuant to any of the foregoing.

 

“ERISA” means the Employee Retirement Income Security Act of 1974.

 

“ERISA Affiliate” means, as applied to any Person, (i) any corporation that is a
member of a controlled group of corporations within the meaning of Section
414(b) of the Internal Revenue Code of which that Person is a member; (ii) any
trade or business (whether or not incorporated) that is a member of a group of
trades or businesses under common control within the meaning of Section 414(c)
of the Internal Revenue Code of which that Person is a member; and (iii) any
member of an affiliated service group within the meaning of Section 414(m) or
(o) of the Internal Revenue Code of which that Person, any corporation described
in clause (i) above or any trade or business described in clause (ii) above is a
member.  Any former ERISA Affiliate of Holdings or any of its Subsidiaries shall
continue to be considered an ERISA Affiliate of Holdings or such Subsidiary
within the meaning of this definition with respect to the period such entity was
an ERISA Affiliate of Holdings or such Subsidiary and with respect to
liabilities arising after such period for which Holdings or such Subsidiary
could be liable under the Internal Revenue Code or ERISA.

 

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“ERISA Event” means (i) a “reportable event” within the meaning of Section 4043
of ERISA and the regulations issued thereunder with respect to any Pension Plan
(excluding those for which the provision for 30-day notice to the PBGC has been
waived by regulation); (ii) the failure to meet the minimum funding standard of
Section 412 of the Internal Revenue Code with respect to any Pension Plan
(whether or not waived in accordance with Section 412(d) of the Internal Revenue
Code) or the failure to make by its due date a required installment under
Section 412(m) of the Internal Revenue Code with respect to any Pension Plan or
the failure to make any required contribution to a Multiemployer Plan; (iii) the
provision by the administrator of any Pension Plan pursuant to Section
4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress
termination described in Section 4041(c) of ERISA; (iv) the withdrawal by
Holdings, Borrower, any of their Subsidiaries or any of their respective ERISA
Affiliates from any Pension Plan with two or more contributing sponsors or the
termination of any such Pension Plan resulting in liability pursuant to Section
4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to
terminate any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (vi) the imposition of liability
on Holdings, Borrower, any of their Subsidiaries or any of their respective
ERISA Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of
the application of Section 4212(c) of ERISA; (vii) the withdrawal of Holdings,
Borrower, any of their Subsidiaries or any of their respective ERISA Affiliates
in a complete or partial withdrawal (within the meaning of Sections 4203 and
4205 of ERISA) from any Multiemployer Plan if there is any potential liability
therefor, or the receipt by Borrower, Holdings, any of their Subsidiaries or any
of their respective ERISA Affiliates of notice from any Multiemployer Plan that
it is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA,
or that it intends to terminate or has terminated under Section 4041A or 4042 of
ERISA; (viii) the occurrence of an act or omission which could give rise to the
imposition on Holdings, Borrower, any of their Subsidiaries or any of their
respective ERISA Affiliates of material fines, penalties, taxes or related
charges under Chapter 43 of the Internal Revenue Code or under Section 409,
Section 502(c), (i) or (l), or Section 4071 of ERISA in respect of any Employee
Benefit Plan; (ix) the assertion of a material claim (other than routine claims
for benefits) against any Employee Benefit Plan other than a Multiemployer Plan
or the assets thereof, or against Holdings, Borrower, any of their Subsidiaries
or any of their respective ERISA Affiliates in connection with any Employee
Benefit Plan; (x) receipt from the Internal Revenue Service of notice of the
failure of any Pension Plan (or any other Employee Benefit Plan intended to be
qualified under Section 401(a) of the Internal Revenue Code) to qualify under
Section 401(a) of the Internal Revenue Code, or the failure of any trust forming
part of any Pension Plan to qualify for exemption from taxation under Section
501(a) of the Internal Revenue Code; or (xi) the imposition of a Lien pursuant
to Section 401(a)(29) or 412(n) of the Internal Revenue Code or pursuant to
ERISA with respect to any Pension Plan.

 

“Event of Default” means each of the events set forth in Section 8.

 

“Excess Senior Note Proceeds” means net cash proceeds from the issuance of
Borrower’s 8.875% Senior Notes due March 15, 2011 minus the amount of all such
net cash proceeds applied to the repayment, repurchase or redemption of Senior
Notes.  As of September 30, 2003, the aggregate amount of Excess Senior Note
Proceeds equals $99,000,000.

 

11

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“Exchange Act” means the Securities Exchange Act of 1934.

 

“Executive Officer” means with respect to any Person, the president, chief
executive officer, chief operating officer, chief financial officer, general
counsel or other officer of such Person, however designated, with
responsibilities similar to the foregoing officers.

 

“Existing Credit Agreement” has the meaning assigned to that term in the
recitals.

 

“Existing Preferred Stock” means all preferred stock of Holdings and its
Subsidiaries which is described on Schedule 7.5.

 

“Fair Market Value” means, as it relates to certain Lodging Assets, the quotient
of (a) Property Level Cash Flow divided by (b) the Cap Rate.

 

“Federal Funds Effective Rate” means, for any period, a fluctuating interest
rate 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 which
is a Business Day, the average of the quotations for such day on such
transactions received by Administrative Agent from three Federal funds brokers
of recognized standing selected by Administrative Agent.

 

“First Priority” means, with respect to any Lien purported to be created in any
Collateral pursuant to any Collateral Document, that (i) such Lien is perfected
and has priority over any other Lien on such Collateral (other than Liens
permitted pursuant to subsection 7.2), and (ii) such Lien is the only Lien
(other than Liens permitted pursuant to subsection 7.2) to which such Collateral
is subject.

 

“Fiscal Quarter” means a fiscal quarter of any Fiscal Year.

 

“Fiscal Year” means the fiscal year of Holdings and its Subsidiaries ending on
December 31 of each calendar year.

 

“Fixed Charges” means, for any period, the sum (without duplication) of the
amounts for such period of (i) Consolidated Net Interest Expense, (ii) all
regularly scheduled principal payments to be made by Holdings and its
Subsidiaries (whether or not such payments are actually made) on all
Indebtedness of Holdings and its Subsidiaries (including the principal component
of all Capital Leases but excluding balloon payments due on Indebtedness at
maturity or earlier acceleration) and (iii) quarterly dividends paid in cash on
the preferred Securities of Holdings or any of its Subsidiaries during such
period, which dividend payments shall be normalized to not exceed four such
quarterly dividend payments in any one Fiscal Year.

 

“Franchise Arrangements” means contracts, agreements and other arrangements
between Holdings or its Subsidiaries and Franchisees pursuant to which Holdings
or its Subsidiaries receive royalty, service, marketing, reservation and other
fees and compensation in the ordinary course of Holdings’ or its Subsidiaries’
business.

 

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“Franchisees” means the Persons who are franchise owners or operators of Lodging
Assets.

 

“Fund” means any Person (other than a natural Person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.

 

“Funding Date” means the date of the funding of a Loan.

 

“GAAP” means, subject to the limitations on the application thereof set forth in
subsection 1.2, generally accepted accounting principles set forth in opinions
and pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants and interpretations, statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession in the United States of America, in each case as the
same are applicable to the circumstances as of the date of determination.

 

“Governing Body” means the board of directors or other body having the power to
direct or cause the direction of the management and policies of a Person that is
a corporation, partnership, trust or limited liability company.

 

“Governmental Authorization” means any permit, license, authorization, plan,
directive, consent order or consent decree of or from any federal, state or
local governmental authority, agency or court.

 

“Guaranty” or “Guaranties” means any or all of the Holdings Guaranty and the
Subsidiary Guaranty.

 

“Hazardous Materials” means (i) any chemical, material or substance at any time
defined as or included in the definition of “hazardous substances”, “hazardous
wastes”, “hazardous materials”, “extremely hazardous waste”, acutely hazardous
waste”, “radioactive waste”, “biohazardous waste”, “pollutant”, “toxic
pollutant”, “contaminant”, “restricted hazardous waste”, “infectious waste”,
“toxic substances”, or any other term or expression intended to define, list or
classify substances by reason of properties harmful to health, safety or the
indoor or outdoor environment (including harmful properties such as
ignitability, corrosivity, reactivity, carcinogenicity, toxicity, reproductive
toxicity, “TCLP toxicity” or “EP toxicity” or words of similar import under any
applicable Environmental Laws); (ii) any oil, petroleum, petroleum fraction or
petroleum derived substance; (iii) any drilling fluids, produced waters and
other wastes associated with the exploration, development or production of crude
oil, natural gas or geothermal resources; (iv) any flammable substances or
explosives; (v) any radioactive materials; (vi) any asbestos-containing
materials; (vii) urea formaldehyde foam insulation; (viii) electrical equipment
which contains any oil or dielectric fluid containing polychlorinated biphenyls;
(ix) pesticides; and (x) any other chemical, material or substance, exposure to
which is prohibited, limited or regulated by any governmental authority or which
may or could pose a hazard to the health and safety of the owners, occupants or
any Persons in the vicinity of any Real Property Asset or to the indoor or
outdoor environment.

 

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“Hazardous Materials Activity” means any past, current, proposed or threatened
activity, event or occurrence involving any Hazardous Materials, including the
use, manufacture, possession, storage, holding, presence, existence, location,
Release, threatened Release, discharge, placement, generation, transportation,
processing, construction, treatment, abatement, removal, remediation, disposal,
disposition or handling of any Hazardous Materials, and any corrective action or
response action with respect to any of the foregoing.

 

“Hedge Agreement” means an Interest Rate Agreement or a Currency Agreement
designed to hedge against fluctuations in or reduce interest rates or to fix or
hedge against currency values, respectively, or in either case to reduce
fluctuations in net cash flow.

 

“Holdings” has the meaning assigned to that term in the introduction to this
Agreement.

 

“Holdings Guaranty” means the guaranty of Holdings as set forth in Section 9 of
this Agreement.

 

“Immaterial Subsidiaries” means Subsidiaries of Holdings which in the aggregate
for all such Subsidiaries (a) do not own assets with an aggregate value in
excess of $15,000,000 and (b) do not generate aggregate revenues in excess of
$15,000,000 in any Fiscal Year.

 

“Indebtedness”, as applied to any Person, means without duplication (i) all
indebtedness for borrowed money including obligations evidenced by bonds,
debentures or similar instruments, plus (ii) that portion of obligations with
respect to Capital Leases that is properly classified as a liability on a
balance sheet in conformity with GAAP, plus (iii) notes payable and drafts
accepted representing extensions of credit whether or not representing
obligations for borrowed money, plus (iv) any obligation owed for all or any
part of the deferred purchase price of property or services (excluding any such
obligations incurred under ERISA), which purchase price is (a) due more than six
months from the date of incurrence of the obligation in respect thereof or (b)
evidenced by a note or similar written instrument, plus (v) all indebtedness
secured by any Lien on any property or asset owned or held by that Person
regardless of whether the indebtedness secured thereby shall have been assumed
by that Person or is nonrecourse to the credit of that Person.  Obligations
under Interest Rate Agreements and Currency Agreements constitute (X) in the
case of Hedge Agreements, Contingent Obligations, and (Y) in all other cases,
Investments, and in neither case constitute Indebtedness.

 

“Indemnitee” has the meaning assigned to that term in subsection 11.3.

 

“Intellectual Property” means all patents, patent rights, patent applications,
licenses, inventions, trade secrets, trademarks, tradenames, service marks,
copyrights, technology, know-how and proprietary techniques (including processes
and substances) used in or necessary for the conduct of the business of Holdings
and its Subsidiaries as currently conducted that are material to the condition
(financial or otherwise), business or operations of Holdings and its
Subsidiaries, taken as a whole.

 

“Interest Payment Date” means (i) with respect to any Base Rate Loan, the last
Business Day of each March, June, September and December of each year,
commencing on

 

14

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the first such date to occur after the Effective Date, and (ii) with respect to
any LIBOR Loan, the last day of each Interest Period applicable to such Loan;
provided that in the case of each Interest Period of six months “Interest
Payment Date” shall also include the date that is three months after the
commencement of such Interest Period.

 

“Interest Period” has the meaning assigned to that term in subsection 2.2B.

 

“Interest Rate Agreement” means any interest rate swap agreement, interest rate
cap agreement, interest rate collar agreement or other similar agreement or
arrangement to which Holdings or any of its Subsidiaries is a party.

 

“Interest Rate Determination Date” means, with respect to any Interest Period,
the second Business Day prior to the first day of such Interest Period.

 

“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended to
the date hereof and from time to time hereafter, and any successor statute.

 

“Investment” means (i) any direct or indirect purchase or other acquisition by
Holdings or any of its Subsidiaries of, or of a beneficial interest in, any
Securities of any other Person (including any Subsidiary of Holdings), (ii) any
direct or indirect redemption, retirement, purchase or other acquisition for
value, by any Subsidiary of Holdings from any Person other than Holdings,
Borrower or any of the Subsidiary Guarantors, of any equity Securities of such
Subsidiary, (iii) any direct or indirect loan, advance (other than advances to
employees for moving, entertainment and travel expenses, drawing accounts and
similar expenditures in the ordinary course of business for business expenses)
or capital contribution by Holdings or any of its Subsidiaries to any other
Person (other than Holdings, Borrower or any Subsidiary Guarantor), including
all indebtedness and accounts receivable from that other Person that are not
current assets or did not arise from sales to that other Person in the ordinary
course of business, or (iv) Interest Rate Agreements or Currency Agreements not
constituting Hedge Agreements.  The amount of any Investment shall be the
original cost of such Investment plus the cost of all additions thereto, without
any adjustments for increases or decreases in value, or write-ups, write-downs
or write-offs with respect to such Investment.  Any direct or indirect
redemption, retirement, purchase or other acquisition for value by Borrower or
Holdings of any of its equity Securities shall be a Restricted Payment and not
an Investment.

 

“Issuing Lender” means, with respect to any Letter of Credit, the Lender which
agrees or is otherwise obligated to issue such Letter of Credit, determined as
provided in subsection 3.1B(ii).

 

“Joint Venture” means a joint venture, partnership or other similar arrangement,
whether in corporate, partnership or other legal form; provided that in no event
shall any Subsidiary of any Person be considered to be a Joint Venture to which
such Person is a party, nor shall any Person in which Holdings or any of its
Subsidiaries otherwise has a controlling interest be considered to be a Joint
Venture of Holdings or its Subsidiaries.

 

“Lender” and “Lenders” means the Persons identified as “Lenders” and listed on
the signature pages of this Agreement, together with their successors and
permitted assigns

 

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pursuant to subsection 11.1; provided that the term “Lenders”, when used in the
context of a particular Commitment, shall mean Lenders having that Commitment.

 

“Lender Hedge Agreements” means one or more Hedge Agreements entered into by and
between Borrower and one or more Lenders or Affiliates of Lenders.

 

“Letter of Credit” or “Letters of Credit” means any letter of credit or similar
instrument issued for the purpose of supporting (i) Indebtedness of Holdings or
any of its Subsidiaries or of such other Persons as are identified on Schedule
7.4 in respect of industrial revenue or development bonds or financings,
(ii) workers’ compensation liabilities of Holdings or any of its Subsidiaries,
(iii) the obligations of third party insurers of Holdings or any of its
Subsidiaries arising by virtue of the laws of any jurisdiction requiring third
party insurers, (iv) obligations with respect to Capital Leases or Operating
Leases of Holdings or any of its Subsidiaries, (v) performance, payment, deposit
or surety obligations of Holdings or any of its Subsidiaries, in any case if
required by law or governmental rule or regulation or in accordance with custom
and practice in the industry, (vi) obligations of Holdings or any of its
Subsidiaries in the nature of security deposits under asset purchase agreements,
deposits provided to utility providers and other ordinary course obligations for
which letters of credit are customarily provided, and (vii) Contingent
Obligations permitted under subsection 7.4; provided that Letters of Credit may
not be issued for the purpose of supporting (a) trade payables or (b) any
Indebtedness constituting “antecedent debt” (as that term is used in Section 547
of the Bankruptcy Code).

 

“Letter of Credit Usage” means, as at any date of determination, the sum of (i)
the maximum aggregate amount which is or at any time thereafter may become
available for drawing under all Letters of Credit then outstanding plus (ii) the
aggregate amount of all drawings under Letters of Credit honored by Issuing
Lenders and not theretofore reimbursed by Borrower (including any such
reimbursement out of the proceeds of Revolving Loans pursuant to subsection
3.3B).

 

“LIBOR Loans” means Loans bearing interest at rates determined by reference to
the Adjusted LIBOR as provided in subsection 2.2A.

 

“Lien” means any lien, mortgage, pledge, assignment, security interest, charge
or encumbrance of any kind (including any conditional sale or other title
retention agreement, any lease in the nature thereof, and any agreement to give
any security interest) and any option, trust or other preferential arrangement
having the practical effect of any of the foregoing.

 

“Loan” or “Loans” means one or more of the Revolving Loans.

 

“Loan Documents” means this Agreement, the Notes, the Letters of Credit (and any
applications for, or reimbursement agreements or other documents or certificates
executed in favor of an Issuing Lender relating to, the Letters of Credit), the
Guaranty and the Collateral Documents.

 

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“Loan Party” means Borrower, Holdings, and any of Holdings’ Subsidiaries from
time to time executing a Loan Document, and “Loan Parties” means all such
Persons, collectively.

 

“Lodging Assets” means hotels, motels, inns, lodges, conference centers, resorts
and similar businesses, all buildings, fixtures or other improvements related
thereto and all personal property, whether tangible or intangible, located at or
related to the foregoing properties and owned, leased or managed by Holdings,
its Subsidiaries or Joint Ventures or which are subject to any Franchise
Arrangements.

 

“Margin Determination Certificate” means an Officers’ Certificate of Borrower
delivered (a) with respect to each Fiscal Quarter (other than each fourth Fiscal
Quarter), with the financial statements required pursuant to subsection 6.1(i),
and (b) with respect to each fourth Fiscal Quarter, with the financial
statements required pursuant to subsection 6.1(ii), setting forth in reasonable
detail the Total Leverage Ratio that is applicable as of the last day of the
fiscal period for which such financial statements and Officers’ Certificate are
being delivered.

 

“Margin Stock” has the meaning assigned to that term in Regulation U of the
Board of Governors of the Federal Reserve System as in effect from time to time.

 

“Material Adverse Effect” means any act, omission, situation, circumstance,
event or undertaking which could reasonably be expected to have, singly or in
any combination with one or more other acts, omissions, situations,
circumstances, events or undertakings, a materially adverse effect upon (a) the
business, assets, properties, liabilities, financial condition, results of
operations or business prospects of Holdings and its Subsidiaries taken as a
whole, (b) the ability of the Loan Parties, taken as a whole, to perform the
obligations of the Loan Parties, taken as a whole, under this Agreement or any
other Loan Document, or (c) the legality, validity, binding effect, priority,
enforceability or admissibility into evidence of any Loan Documents or the
material rights or remedies of Administrative Agent or Lenders under or in
connection with any Loan Documents.

 

“Material Contract” means any contract or other arrangement to which Holdings or
any of its Subsidiaries is a party (other than the Loan Documents) for which
breach, nonperformance, cancellation or failure to renew could reasonably be
expected to have a Material Adverse Effect.

 

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

 

“Multiemployer Plan” means any Employee Benefit Plan that is a “multiemployer
plan” as defined in Section 3(37) of ERISA.

 

“Net Asset Sale Proceeds” means, with respect to any Asset Sales, Cash payments
(including any Cash received by way of deferred payment pursuant to, or by
monetization of, a note receivable or otherwise, including principal payments
thereon, but only as and when so received) received by Holdings or any of its
Subsidiaries from such Asset Sales, net of any direct costs incurred in
connection with such Asset Sales, including without limitation (i) taxes
reasonably estimated to be actually payable by Holdings or any of its
Subsidiaries within two

 

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years of the date of such Asset Sales as a result of such Asset Sales and
(ii) payment of the outstanding principal amount of, premium or penalty, if any,
and interest on any Indebtedness of Holdings or any of its Subsidiaries (other
than the Loans or any Indebtedness secured equally and ratably with the Loans)
that is secured by a Lien on the stock or assets in question and that is
required to be repaid under the terms thereof as a result of such Asset Sales. 
It is understood and agreed that with respect to Asset Sales by or of a
non-wholly-owned Subsidiary, Net Asset Sale Proceeds for purposes of this
Agreement shall only include that portion of such Net Asset Sale Proceeds which
is payable or distributable to Holdings and its direct or indirect wholly-owned
Subsidiaries.

 

“Net Securities Proceeds” means amounts equal to (i) 50% of the Cash proceeds
(net of underwriting discounts and commissions and other reasonable costs and
expenses associated therewith, including reasonable legal fees and expenses)
from the issuance (other than to Holdings or any of its wholly owned
Subsidiaries) of equity Securities of Holdings or any of its Subsidiaries
(including Indebtedness convertible into equity Securities) or (ii) 100% of the
Cash proceeds (net of underwriting discounts and commissions and other
reasonable costs and expenses associated therewith, including reasonable legal
fees and expenses) from the incurrence or issuance of Indebtedness by Holdings
or any of its Subsidiaries (excluding the proceeds of any Indebtedness permitted
under subsections 7.1(i), 7.1(ii), 7.1(iii), 7.1(iv), 7.1(v) and 7.1(ix), and to
the extent that the proceeds of such Indebtedness are used to refinance other
Indebtedness, Indebtedness permitted under subsections 7.1(vii) and 7.1(viii)). 
It is understood and agreed that with respect to the issuance of equity
Securities or Indebtedness by a non-wholly-owned Subsidiary, Net Securities
Proceeds for purposes of this Agreement shall only include that portion of such
Net Securities Proceeds which is payable or distributable to Holdings or its
direct or indirect wholly-owned Subsidiaries.

 

“Notes” means one or more of the Revolving Notes.

 

“Notice of Borrowing” means a notice substantially in the form of Exhibit I
annexed hereto delivered by Borrower to Administrative Agent pursuant to
subsection 2.1B with respect to a proposed borrowing.

 

“Notice of Conversion/Continuation” means a notice substantially in the form of
Exhibit II annexed hereto delivered by Borrower to Administrative Agent pursuant
to subsection 2.2D with respect to a proposed conversion or continuation of the
applicable basis for determining the interest rate with respect to the Loans
specified therein.

 

“Notice of Issuance of Letter of Credit” means a notice substantially in the
form of Exhibit III annexed hereto delivered by Borrower to Administrative Agent
pursuant to subsection 3.1B(i) with respect to the proposed issuance of a Letter
of Credit.

 

“Obligations” means all obligations of every nature of each Loan Party from time
to time owed to Administrative Agent, Lenders or any of them under the Loan
Documents, whether for principal, interest, reimbursement of amounts drawn under
Letters of Credit, fees, expenses, indemnification or otherwise.

 

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“Officer” means the president, chief executive officer, a vice president, chief
financial officer, treasurer, general partner (if an individual), managing
member (if an individual) or other individual appointed by the governing body or
the organizational documents of a corporation, partnership, trust or limited
liability company to serve in a similar capacity as the foregoing.

 

“Officers’ Certificate,” as applied to any Person that is a corporation,
partnership, trust or limited liability company, means a certificate executed on
behalf of such Person by one or more Officers, or other designated person
approved by Administrative Agent, such approval not to be unreasonably withheld,
of such Person or one or more Officers, or other designated person approved by
Administrative Agent, such approval not to be unreasonably withheld, of a
general partner or a managing member if such general partner or managing member
is a corporation, partnership, trust or limited liability company; provided that
every Officers’ Certificate with respect to the compliance with a condition
precedent to the making of any Loans hereunder shall include (i) a statement
that the Officer or Officers or other approved designated person making or
giving such Officers’ Certificate have read such condition and any definitions
or other provisions contained in this Agreement relating thereto, (ii) a
statement that, in the opinion of the signers, they have made or have caused to
be made such examination or investigation as is reasonably necessary to enable
them to express an informed opinion as to whether or not such condition has been
complied with, and (iii) a statement as to whether, in the opinion of the
signers, such condition has been complied with; provided that any Officer or
other approved designated person executing an Officers’ Certificate shall not
have any personal liability in connection therewith.

 

“Operating Lease” means, as applied to any Person, any lease (including leases
that may be terminated by the lessee at any time) of any property (whether real,
personal or mixed) that is not a Capital Lease other than any such lease under
which that Person is the lessor.

 

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

 

“Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan,
which is subject to Section 412 of the Internal Revenue Code or Section 302 of
ERISA.

 

“Permitted Acquisition” means an acquisition of an entity engaged in the lodging
or similar business provided that (i) after giving effect to the consummation of
such acquisition, Borrower and Holdings are in compliance, on a Pro Forma Basis,
with the financial covenants set forth in subsection 7.6 hereof, (ii) no Event
of Default or Potential Event of Default shall have occurred and be continuing
or would occur as a result of such acquisition, (iii) the sum of (A) the amount
by which the Revolving Loan Commitments exceeds the Total Utilization of
Revolving Loan Commitments and (B) Borrower’s and Holdings’ Cash and/or Cash
Equivalents is not less than $50,000,000 and (iv) Borrower and Holdings comply
with the requirements of subsection 6.8 with respect to such acquisition.

 

“Permitted Encumbrances” means the following types of Liens (excluding any such
Lien imposed pursuant to Section 401(a)(29) or 412(n) of the Internal Revenue
Code or by ERISA, any such Lien relating to or imposed in connection with any
Environmental Claim,

 

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and any such Lien expressly prohibited by any applicable terms of any of the
Collateral Documents):

 

(i)            Liens for taxes, assessments or governmental charges or claims
the payment of which is not, at the time, required by subsection 6.3;

 

(ii)           statutory Liens of landlords, statutory Liens of banks and rights
of set-off, statutory Liens of carriers, warehousemen, mechanics, repairmen,
workmen and materialmen, and other Liens imposed by law, in each case incurred
in the ordinary course of business (a) for amounts not yet overdue or (b) for
amounts that are overdue and that (in the case of any such amounts overdue for a
period in excess of 5 days) are being contested in good faith by appropriate
proceedings, so long as (1) such reserves or other appropriate provisions, if
any, as shall be required by GAAP shall have been made for any such contested
amounts, and (2) in the case of a Lien with respect to any portion of the
Collateral, such contested proceedings conclusively operate to stay the sale of
any portion of the Collateral on account of such Lien;

 

(iii)          Liens incurred or deposits made in the ordinary course of
business in connection with workers’ compensation, unemployment insurance and
other types of social security, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases, government
contracts, trade contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the payment of borrowed
money), so long as no foreclosure, sale or similar proceedings have been
commenced with respect to any portion of the Collateral on account thereof;

 

(iv)          any attachment or judgment Lien not constituting an Event of
Default under subsection 8.8;

 

(v)           leases or subleases granted to third parties including without
limitation to restaurant operators and Franchisees that do not interfere in any
material respect with the ordinary conduct of the business of Holdings or any of
its Subsidiaries or result in a material diminution in the value of any
Collateral as security for the Obligations;

 

(vi)          easements, rights-of-way, restrictions, covenants, encroachments,
and other minor defects or irregularities in title, in each case which do not
and will not interfere in any material respect with the ordinary conduct of the
business of Holdings or any of its Subsidiaries or result in a material
diminution in the value of any Collateral as security for the Obligations;

 

(vii)         any (a) restriction or encumbrance that the interest or title of
such lessor or sublessor may be subject to, or (b) subordination of the interest
of the lessee or sublessee under such lease to any restriction or encumbrance
referred to in the preceding clause (a), so long as the holder of such
restriction

 

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or encumbrance agrees to recognize the rights of such lessee or sublessee under
such lease;

 

(viii)        purchase options granted at a price not less than the fair market
value of such property;

 

(ix)           Liens arising from filing UCC financing statements relating
solely to leases permitted by this Agreement;

 

(x)            Liens in favor of Holdings and its Subsidiaries granted by third
parties on the properties and assets of such third parties; and

 

(xi)           Liens in favor of trustees under the Senior Note Documents on
Cash and Securities deposited in connection with a defeasance of Senior Notes,
to the extent such defeasance is permitted under this Agreement.

 

“Permitted Reinvestment Capital Expenditures” means, with respect to each Real
Property Asset of Holdings or its Subsidiaries which is subject to a casualty
loss or eminent domain proceeding, the sum of (i) Capital Expenditures
representing the reinvestment of casualty insurance proceeds or eminent domain
proceeds (or proceeds from a sale in lieu thereof), as the case may be, actually
received by Holdings or its Subsidiaries as a result of their respective
casualty loss or eminent domain proceeding (or sale in lieu thereof) plus
(ii) with respect to each such Real Property Asset, the lesser of $6,000,000 or
the then Available Basket Amount plus (iii) Capital Expenditures representing
the reinvestment of net proceeds from the sale of Lodging Assets, the cumulative
amount of which under this clause (iii) shall not exceed the lesser of (a) the
cumulative amount of net sale proceeds from the sale of Lodging Assets actually
received since the Closing Date or (b) $50,000,000 per Fiscal Year.

 

“Person” means and includes natural persons, corporations, limited partnerships,
general partnerships, limited liability companies, limited liability
partnerships, joint stock companies, Joint Ventures, associations, companies,
trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments (whether federal,
state or local, domestic or foreign, and including political subdivisions
thereof) and agencies or other administrative or regulatory bodies thereof.

 

“Pledge Agreement” means the Amended and Restated Pledge and Security Agreement
executed and delivered by Holdings, Borrower and their Subsidiaries that own
Pledged Collateral on the Effective Date and to be executed and delivered by
additional subsidiaries of Borrower and Holdings from time to time thereafter
pursuant to subsection 6.8, substantially in the form of Exhibit X annexed
hereto, as such Amended and Restated Pledge Agreement may hereafter be amended,
supplemented or otherwise modified from time to time.

 

“Pledged Collateral” means, collectively, the “Pledged Collateral” as defined in
the Pledge Agreement.

 

“Potential Event of Default” means a condition or event that, after notice or
lapse of time or both, would constitute an Event of Default.

 

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“Pro Forma Basis” means, as of any date of determination, to the extent so
provided for herein, that the compliance of Borrower and Holdings with the
financial covenants set forth in subsection 7.6 as of the last day of the four
Fiscal Quarter period most recently ended prior to such date of determination
for which the relevant financial information is available (the “Compliance
Period”), will be determined after giving effect on a pro forma basis to any
permitted acquisitions made during such Compliance Period and any permitted
dispositions made during such Compliance Period, other than sales of inventory
in the ordinary course of business and dispositions of obsolete equipment, on
the following basis:

 

(i)            any Indebtedness incurred or assumed by Holdings or any of its
Subsidiaries and any Indebtedness repaid, each only in connection with such
permitted acquisitions or dispositions, shall be deemed to have been incurred or
repaid, respectively, as of the first day of the Compliance Period; for purposes
of this clause (i), the aggregate amount of any such Indebtedness shall be net
of Cash and Cash Equivalents in excess of $5,000,000 held by Holdings and its
Subsidiaries;

 

(ii)           if such Indebtedness incurred or assumed by Holdings or any of
its Subsidiaries has a floating or formula rate, then the rate of interest for
such Indebtedness in connection with any such permitted acquisition or
disposition for the applicable period shall be computed as if the rate in effect
for such Indebtedness on the relevant measurement date had been the applicable
rate for the entire applicable period;

 

(iii)          income statement items (whether positive or negative)
attributable to the property or business acquired or disposed of in such
permitted acquisitions or dispositions shall be included or excluded, as
applicable, as if such acquisitions or dispositions took place on the first day
of such Compliance Period on a pro forma basis; and

 

(iv)          any historical extraordinary non-recurring costs or expenses or
other verifiable costs or expenses that will not continue after the acquisition
or disposition date may be eliminated and other expenses and cost reductions may
be reflected on a basis consistent with Regulation S-X promulgated by the
Securities and Exchange Commission or as approved by Administrative Agent.

 

“Property Level Cash Flow” means, for a period of four consecutive fiscal
quarters preceding the date of such determination as it relates to certain
Lodging Assets, the sum of (i) the total revenue generated by or solely
attributable to such Lodging Assets, minus (ii) direct expenses, which shall
include expenses such as salaries, payroll taxes and benefits, supplies, repair
and maintenance, utilities, advertising, security, purchased services, vehicle
expenses, travel agency commissions, bad debt, credit card discounts, collection
costs and other inn expenses, minus (iii) other direct expenses, which shall
include expenses such as restaurant & club expenses (net), property taxes and
insurance, minus (iv) total fees, which shall include fees such as reservation
fees, marketing fees and information technology support fees, minus (v) royalty
fees (calculated at 4% of net room revenues), minus (vi) the related Capital
Expenditure Reserve.

 

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“Pro Rata Share” means with respect to all payments, computations and other
matters relating to the Revolving Loan Commitment or the Revolving Loans of any
Lender or any Letters of Credit issued or participations therein purchased by
any Lender, the percentage obtained by dividing (i) the Revolving Loan Exposure
of that Lender by (ii) the aggregate Revolving Loan Exposure of all Lenders.

 

“Real Property Asset” means, at any time of determination, any interest then
owned by any Loan Party in any real property.

 

“Reference Rate” means the rate that CIBC announces from time to time as its
prime lending rate, as in effect from time to time. The Reference Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer.  CIBC or any other Lender may make commercial
loans or other loans at rates of interest at, above or below the Reference Rate.

 

“Refinancing Indebtedness” has the meaning assigned to that term in subsection
7.1(v).

 

“Regulation D” means Regulation D of the Board of Governors of the Federal
Reserve System, as in effect from time to time.

 

“Reimbursement Date” has the meaning assigned to that term in subsection 3.3B.

 

“REIT” means a real estate investment trust as defined under the Internal
Revenue Code.

 

“Release” means any release, spill, emission, leaking, pumping, pouring,
injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching
or migration of Hazardous Materials into the indoor or outdoor environment
(including the abandonment or disposal of any barrels, containers or other
closed receptacles containing any Hazardous Materials), including the movement
of any Hazardous Materials through the air, soil, surface water or groundwater.

 

“Requisite Lenders” means Lenders having or holding more than 50% of the
aggregate Revolving Loan Exposure of all Lenders.

 

“Restricted Payment” means (i) any dividend or other distribution, direct or
indirect, on account of any shares of Borrower’s or Holdings’ common stock,
Borrower’s or Holdings’ preferred stock, or any other class of stock of Borrower
or Holdings now or hereafter outstanding, except a dividend payable solely in
shares of that class of stock to the holders of that class, (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of Borrower’s or Holdings’ common
stock, Borrower’s or Holdings’ preferred stock, or any other class of stock of
Borrower or Holdings now or hereafter outstanding, (iii) any payment made to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of Borrower’s or Holdings’ common stock,
Borrower’s or Holdings’ preferred stock, or any other class of stock of Borrower
or Holdings now or hereafter outstanding, and (iv) any payment or prepayment of
principal of, premium, if any, or interest on, or redemption, purchase,

 

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retirement, defeasance (including in-substance or legal defeasance), sinking
fund or similar payment with respect to any Subordinated Indebtedness.

 

“Revolving Loan Commitment” means the commitment of a Lender to make Revolving
Loans to Borrower pursuant to subsection 2.1A(i), and “Revolving Loan
Commitments” means such commitments of all Lenders in the aggregate.

 

“Revolving Loan Commitment Termination Date” means April 30, 2007.

 

“Revolving Loan Exposure” means, with respect to any Lender, as of any date of
determination (i) prior to the termination of the Revolving Loan Commitments,
that Lender’s Revolving Loan Commitment, and (ii) after the termination of the
Revolving Loan Commitments, the sum of (a) the aggregate outstanding principal
amount of the Revolving Loans of that Lender plus (b) in the event that Lender
is an Issuing Lender, the aggregate Letter of Credit Usage in respect of all
Letters of Credit issued by that Lender (in each case, net of any participations
purchased by other Lenders in such Letters of Credit or in any unreimbursed
drawings thereunder) plus (c) the aggregate amount of all participations
purchased by that Lender in any outstanding Letters of Credit or any
unreimbursed drawings under any Letters of Credit.

 

“Revolving Loans” means the Loans made by Lenders to Borrower pursuant to
subsection 2.1A(i).

 

“Revolving Notes” means (i) any promissory notes of Borrower issued pursuant to
subsection 2.1D on the Effective Date, and (ii) any promissory notes issued by
Borrower pursuant to subsection 2.1A(ii) in connection with increases in the
Revolving Loan Commitments or the last sentence of subsection 11.1B(i) in
connection with permitted assignments of the Revolving Loan Commitments and
Revolving Loans of any Lenders, in each case substantially in the form of
Exhibit V annexed hereto, as they may be amended, supplemented or otherwise
modified from time to time.

 

“S&P” means Standard & Poor’s Ratings Group.

 

“Securities” means any stock, shares, partnership interests, voting trust
certificates, certificates of interest or participation in any profit-sharing
agreement or arrangement, options, warrants, bonds, debentures, notes, or other
evidences of Indebtedness, secured or unsecured, convertible, subordinated or
otherwise, or in general any instruments commonly known as “securities” or any
certificates of interest, shares or participations in temporary or interim
certificates for the purchase or acquisition of, or any right to subscribe to,
purchase or acquire, any of the foregoing.

 

“Securities Act” means the Securities Act of 1933, as amended from time to time,
and any successor statute.

 

“Senior Notes” means those notes issued pursuant to (i) the Indenture, dated as
of July 26, 1995, by and between Borrower and Fleet National Bank, (ii) the
Third Supplemental Indenture, dated as of August 10, 1995, by and between
Borrower and Fleet National Bank, to the Indenture dated as of July 26, 1995,
(iii) the Fourth Supplemental Indenture, dated as of

 

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September 10, 1996, by and between Borrower and Fleet National Bank, to the
Indenture dated as of July 26, 1995, (iv) the Fifth Supplemental Indenture,
dated as of August 12, 1997, by and between Borrower and Fleet National Bank, to
the Indenture dated as of July 26, 1995, (v) the Sixth Supplemental Indenture,
dated as of August 12, 1997, by and between Borrower and State Street Bank and
Trust Company (as Successor Trustee to Fleet National Bank), to the Indenture
dated as of July 26, 1995, (vi) the Eighth Supplemental Indenture, dated as of
November 5, 1997, by and between Borrower and State Street Bank and Trust
Company (as Successor Trustee to Fleet National Bank), to the Indenture dated as
of July 26, 1995, (vii) the Indenture, dated as of September 15, 1995, by and
between La Quinta Inns, Inc. (predecessor-in-interest to Borrower) and U.S.
Trust Company of Texas, N.A., and (viii) the Indenture dated as of March 19,
2003, by and between Borrower, Holdings and U.S. Bank Trust National
Association, as trustee.

 

“Senior Note Documents” means the Senior Notes, the Indentures referenced in
clauses (i), (vii) and (viii) of the definition of Senior Notes and all
supplements to such Indentures.

 

“7.114% Notes” means Borrower’s 7.114% Notes due August 15, 2011 held by the
Meditrust Exercisable Put Option Securities Trust.

 

“7.114% Securities” means the Exercisable Put Option Securities due August 15,
2004 issued by the Meditrust Exercisable Put Option Securities Trust.

 

“Solvent” means, with respect to any Person, that as of the date of
determination both (A) (i) the then fair saleable value of the property and
assets of such Person is (y) greater than the total amount of liabilities
(including contingent liabilities) of such Person and (z) not less than the
amount that will be required to pay the probable liabilities on such Person’s
then existing debts as they become absolute and matured considering all
financing alternatives and potential asset sales reasonably available to such
Person; (ii) such Person’s capital is not unreasonably small in relation to its
business or any contemplated or undertaken transaction; and (iii) such Person
does not intend to incur, or believe (nor should it reasonably believe) that it
will incur, debts beyond its ability to pay such debts as they become due; and
(B) such Person is “solvent” within the meaning given that term and similar
terms under applicable laws relating to fraudulent transfers and conveyances. 
For purposes of this definition, the amount of any contingent liability at any
time shall be computed as the amount that, in light of all of the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.

 

“Subordinated Indebtedness” means any unsecured Indebtedness of Holdings and its
Subsidiaries subordinated in right of payment to the Obligations which
Indebtedness shall not mature or be mandatorily redeemable (other than pursuant
to customary asset sale offer or change of control offer provisions) earlier
than six months after the Revolving Loan Commitment Termination Date, shall not
provide for any amortization or sinking fund payments and which shall be issued
pursuant to documentation containing covenants, defaults, remedies and
subordination provisions reasonably satisfactory to Administrative Agent.

 

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“Subsidiary” means, with respect to any Person, any corporation, partnership,
limited liability company, association, joint venture or other business entity
of which more than 50% of the total voting power of shares of stock or other
ownership interests entitled (without regard to the occurrence of any
contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof.

 

“Subsidiary Guarantor” means any Subsidiary of Borrower or Holdings that
executes and delivers a counterpart of the Subsidiary Guaranty on the Effective
Date or from time to time thereafter pursuant to subsection 6.8, unless and
until released therefrom pursuant to the terms hereof or thereof.

 

“Subsidiary Guaranty” means the Amended and Restated Subsidiary Guaranty
executed and delivered by existing Subsidiaries of Borrower and Holdings on the
Effective Date and to be executed and delivered by additional Subsidiaries of
Borrower and Holdings from time to time thereafter in accordance with subsection
6.8, substantially in the form of Exhibit VII annexed hereto, as such Amended
and Restated Subsidiary Guaranty may hereafter be amended, supplemented or
otherwise modified from time to time.

 

“Supplemental Collateral Agent” has the meaning assigned to that term in
subsection 10.1B.

 

“Syndication Agent” has the meaning assigned to that term in the recitals.

 

“Tax” or “Taxes” means any present or future tax, levy, impost, duty, charge,
fee, deduction or withholding of any nature and whatever called, by whomsoever,
on whomsoever and wherever imposed, levied, collected, withheld or assessed,
including interest, penalties, additions to tax and any similar liabilities with
respect thereto; except that, in the case of a Lender, there shall be excluded
(1) taxes that are imposed on the overall net income or net profits (including
franchise taxes imposed in lieu thereof) (i) by the United States, (ii) by any
other government authority under the laws of which the Lender is organized or
has its principal office or maintains its applicable lending office, or (iii) by
any jurisdiction solely as a result of a present or former connection between
the Lender (other than any such connection arising solely from the Lender having
executed, delivered or performed its obligations or received a payment under, or
enforced any of the Loan Documents), and (2) any branch profits taxes imposed by
the United States or any similar tax imposed by any other jurisdiction in which
the Lender is located.

 

 “Total Debt” means, as at any date of determination and without duplication,
the sum of (a) the aggregate amount of all Indebtedness (including the 7.114%
Notes for purposes of financial covenant calculations) of Holdings and its
Subsidiaries minus (b) the amount of Holdings’ and its Subsidiaries’ Cash and
Cash Equivalents in excess of $5,000,000.

 

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“Total Leverage Ratio” means, as at the last day of any Fiscal Quarter, the
ratio of (a) Total Debt as of the last day of such Fiscal Quarter to (b)
Consolidated EBITDA for the four Fiscal Quarter period then ended.

 

“Total Utilization of Revolving Loan Commitments” means, as at any date of
determination, the sum of (i) the aggregate principal amount of all outstanding
Revolving Loans (other than Revolving Loans made for the purpose of reimbursing
the applicable Issuing Lender for any amount drawn under any Letter of Credit
but not yet so applied) plus (ii) the Letter of Credit Usage.

 

“Type” means, with respect to any Loan, a Revolving Loan.

 

“UCC” means the Uniform Commercial Code (or any similar or equivalent
legislation) as in effect in any applicable jurisdiction.

 

1.2                               Accounting Terms; Utilization of GAAP for
Purposes of Calculations Under Agreement.

 

Except as otherwise expressly provided in this Agreement, all accounting terms
not otherwise defined herein shall have the meanings assigned to them in
conformity with GAAP.  Financial statements and other information required to be
delivered by Borrower to Administrative Agent pursuant to clauses (i), (ii) and
(xi) of subsection 6.1 shall be prepared in accordance with GAAP as in effect at
the time of such preparation (and delivered together with the reconciliation
statements provided for in subsection 6.1(iv)).  Calculations in connection with
the definitions, covenants and other provisions of this Agreement shall utilize
GAAP as in effect on the date of determination, applied in a manner consistent
with that used in preparing the financial statements referred to in subsection
5.3.  If at any time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and Borrower,
Administrative Agent or Requisite Lenders shall so request, Administrative
Agent, Lenders and Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change 
(subject to the approval of Requisite Lenders), provided that, until so amended,
such ratio or requirement shall continue to be computed in accordance with GAAP
prior to such change therein and Holdings or Borrower shall provide to
Administrative Agent reconciliation statements provided for in subsection
6.1(iv).  Notwithstanding the foregoing, all financial ratios and requirements
shall be calculated in a manner to adjust for the effects of changes in GAAP
after the Closing Date but prior to the Effective Date.

 

1.3                               Other Definitional Provisions and Rules of
Construction.

 

A.            Any of the terms defined herein may, unless the context otherwise
requires, be used in the singular or the plural, depending on the reference.

 

B.            References to “Sections” and “subsections” shall be to Sections
and subsections, respectively, of this Agreement unless otherwise specifically
provided.

 

C.            The use in any of the Loan Documents of the word “include” or
“including”, when following any general statement, term or matter, shall not be
construed to limit such

 

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statement, term or matter to the specific items or matters set forth immediately
following such word or to similar items or matters, whether or not nonlimiting
language (such as “without limitation” or “but not limited to” or words of
similar import) is used with reference thereto, but rather shall be deemed to
refer to all other items or matters that fall within the broadest possible scope
of such general statement, term or matter.

 

D.            Each of the parties hereto acknowledges that (i) it has been
represented by counsel in the negotiation and documentation of the terms of this
Agreement, (ii) it has had full and fair opportunity to review and revise the
terms of this Agreement, (iii) this Agreement has been drafted jointly by all of
the parties hereto, and (iv) neither Administrative Agent nor any Lender has any
fiduciary relationship with or duty to Holdings or Borrower arising out of or in
connection with this Agreement or any of the other Loan Documents, and the
relationship between Administrative Agent and Lenders, on one hand, and Borrower
and Holdings, on the other hand, in connection herewith or therewith is solely
that of debtor and creditor.  Accordingly, each of the parties hereto
acknowledges and agrees that the terms of this Agreement shall not be construed
against or in favor of another party.

 

E.             (i) Any reference in this Agreement or any other Loan Document to
any agreement means such agreement as it may be amended, supplemented or
otherwise modified from time to time; (ii) any reference in this Agreement or
any other Loan Document to any law, statute, regulation, rule or other
legislative action shall mean such law, statute, regulation, rule or other
legislative action as amended, supplemented or otherwise modified from time to
time, and shall include any rule or regulation promulgated thereunder; and (iii)
any reference in this Agreement or any other Loan Document to a Person shall
include the successor or assignee of such Person.

 

F.             Any reference in this Agreement to “Holdings and its
Subsidiaries” or to the Subsidiaries of Holdings means and includes Borrower and
its Subsidiaries, each of which is a Subsidiary of Holdings.

 

Section 2.              AMOUNTS AND TERMS OF COMMITMENTS AND LOANS

 

2.1                               Commitments; Making of Loans; Optional Notes.

 

A.            Commitments.  Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties of Borrower
and Holdings herein set forth, each Lender hereby severally agrees to make the
Loans described in subsection 2.1A(i):

 

(i)            Revolving Loans.  Each Lender severally agrees, subject to the
limitations set forth below with respect to the maximum amount of Revolving
Loans permitted to be outstanding from time to time, to lend to Borrower from
time to time during the period from the Effective Date to but excluding the
Revolving Loan Commitment Termination Date an aggregate amount not exceeding its
Pro Rata Share of the aggregate amount of the Revolving Loan Commitments to be
used for the purposes identified in subsection 2.5A.  The amount of each
Lender’s Revolving Loan Commitment as of the Effective Date is set forth in its
Allocation Letter and the aggregate amount of the Revolving Loan Commitments as
of the Effective Date is

 

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$150,000,000; provided that the Revolving Loan Commitments of Lenders shall be
adjusted to give effect to any permitted assignments of the Revolving Loan
Commitments pursuant to subsection 11.1B; provided, that the Revolving Loan
Commitments of Lenders shall be adjusted to give effect to any increase of the
Revolving Loan Commitment pursuant to subsection 2.1A(ii); and provided,
further, that the amount of the Revolving Loan Commitments shall be reduced from
time to time by the amount of any reductions thereto made pursuant to subsection
2.4.  Each Lender’s Revolving Loan Commitment shall expire on the Revolving Loan
Commitment Termination Date and all Revolving Loans and all other amounts owed
hereunder with respect to the Revolving Loans and the Revolving Loan Commitments
shall be paid in full no later than that date.  Amounts borrowed under this
subsection 2.1A(i) may be repaid and reborrowed to but excluding the Revolving
Loan Commitment Termination Date.

 

In no event shall the Total Utilization of Revolving Loan Commitments at any
time (i) exceed the Revolving Loan Commitments then in effect or (ii) result in,
at the time of such borrowing, the sum of Cash and Cash Equivalents of Holdings
and its Subsidiaries being in excess of $25,000,000 (unless Borrower has
certified to Administrative Agent at the time of such borrowing that the
proceeds of such Loans will be used for an identified purpose which will result
in, within five Business Days, Cash and Cash Equivalents of Holdings and its
Subsidiaries being equal to or less than $25,000,000, and such certification is
true on such fifth Business Day); provided that for purposes of making the
determinations provided for in this clause (ii), Cash and Cash Equivalents which
constitute Excess Senior Note Proceeds which are being held by Borrower pending
the application of such proceeds to the repayment, repurchase or redemption of
Senior Notes shall be excluded from such determinations.

 

(ii)           Increases of the Revolving Loan Commitments; Addition of a Term
Loan Facility.  Within ninety days after the Effective Date, with the consent of
Administrative Agent, Borrower may increase the then effective aggregate
principal amount of the Revolving Loan Commitments one time in an aggregate
principal amount of up to $75,000,000 from oversubscription.  In addition to any
increase pursuant to the preceding sentence, with the consent of the
Administrative Agent, Borrower may, at any time on or after the Effective Date,
(x) increase the then effective aggregate principal amount of Revolving Loan
Commitments and/or (y) add a term loan facility to this Agreement; provided that
the aggregate principal amount of any increase in the Revolving Loan Commitments
pursuant to this sentence plus the aggregate principal amount of any term loan
facility pursuant to this subsection 2.1A(ii) shall not exceed $150,000,000.  In
connection with any increase in the Revolving Loan Commitments under this
subsection 2.1A(ii) or the addition of any such term loan facility, (1) Borrower
and Holdings shall execute and deliver such documents and instruments and take
such other actions as may be reasonably requested by Administrative Agent in
connection with such increase or addition, (2) at the time of any such proposed
increase or addition no Potential Event of Default or Event of Default shall
have occurred and be continuing or would occur after giving effect to such
increase or addition, and (3) with respect to the addition of a term loan
facility, (a) such term loan facility shall rank pari passu with the Revolving
Loans and have a

 

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maturity date no earlier than the Revolving Loan Commitment Termination Date,
(b) such term loan facility shall be subject to mandatory prepayment with 50% of
the net cash proceeds of equity issuances, to the extent such proceeds are used
to reduce funded debt, and 100% of the net cash proceeds of all debt issuances
(excluding debt issuances that refinance existing Indebtedness that matures or
is redeemable at the holder’s option prior to the term loan maturity date) and
(c) Borrower shall execute and deliver an amendment to this Agreement providing
for such term loan facility and containing other general terms and conditions
substantially similar to those relating to term loans in the Existing Credit
Agreement or as are otherwise acceptable to Administrative Agent and Borrower. 
Any request under this subsection 2.1A(ii) shall be submitted by Borrower to
Administrative Agent.  Borrower may also specify any fees offered to those
Lenders (the “Increasing Lenders”) which agree to increase the principal amount
of their Revolving Loan Commitments or provide a term loan, as the case may be,
which fees may be variable based upon the amount by which any such Lender is
willing to increase the principal amount of its Revolving Loan Commitment or the
amount of the term loan such Lender is willing to provide, as the case may be. 
No Lender shall have any obligation, express or implied, to offer to increase
the aggregate principal amount of its Revolving Loan Commitment or to provide a
term loan, as the case may be.  Only the consent of each Increasing Lender shall
be required for an increase in the aggregate principal amount of the applicable
Revolving Loan Commitments or for the provision of a term loan, as the case may
be, pursuant to this 2.1A(ii).  No Lender which declines to increase the
principal amount of its Revolving Loan Commitment or to provide a term loan, as
the case may be, may be replaced in respect to its existing Revolving Loan
Commitment as a result thereof without such Lender’s consent.

 

Each Increasing Lender shall as soon as practicable specify the amount of the
proposed increase that it is willing to assume or the term loan that it is
willing to make.  Borrower may accept some or all of the offered amounts or
designate new lenders that qualify as Eligible Assignees and that are reasonably
acceptable to Administrative Agent as additional Lenders hereunder in accordance
with this subsection 2.1A(ii) (each such new lender being a “New Lender”), which
New Lenders may assume all or a portion of the increase in the aggregate
principal amount of the Revolving Loan Commitments or may make all or a portion
of the term loans, as the case may be.  Borrower and Administrative Agent shall
have discretion jointly to adjust the allocation of the increased aggregate
principal amount of the Revolving Loan Commitments or the principal amount of
the term loans, as the case may be, among Increasing Lenders and New Lenders.

 

Subject to the foregoing, any increase requested by Borrower shall be effective
upon delivery to Administrative Agent of each of the following documents: 
(i) an originally executed copy of an instrument of joinder substantially in the
form attached hereto as Exhibit IV signed by a duly authorized officer of each
New Lender, in form and substance reasonably satisfactory to Administrative
Agent; (ii) a notice to the Increasing Lenders and New Lenders, in form and
substance reasonably satisfactory to Administrative Agent, signed by a duly
authorized officer of Borrower; (iii) to the extent requested by any New Lender
or Increasing Lender, executed Notes issued by

 

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Borrower in accordance with subsection 2.1D hereof; and (iv) any other
certificates or documents that Administrative Agent shall reasonably request, in
form and substance reasonably satisfactory to Administrative Agent, including an
amendment with respect to the term loan facility as provided in the first
paragraph of this subsection.  Any such increase shall be in principal amount
equal to (A) the principal amount that Increasing Lenders are willing to assume
as increases to the principal amount of their Revolving Loan Commitments or the
principal amount of the term loans that Increasing Lenders are willing to make,
as the case may be, plus (B) the principal amount offered by New Lenders with
respect to the applicable term loan or Revolving Loan Commitments, as the case
may be, in either case as adjusted by Borrower and Administrative Agent pursuant
to this subsection 2.1A(ii).  Upon effectiveness of any such increase, the
Commitments and Pro Rata Share of each Lender will be adjusted to give effect to
the increase in the Revolving Loan Commitments or the principal amount of the
term loan, as the case may be.  To the extent that the adjustment of Pro Rata
Shares results in losses or expenses to any Lender as a result of the prepayment
of any LIBOR Loan on a date other than the scheduled last day of the applicable
Interest Period, Borrower shall be responsible for such losses or expenses
pursuant to subsection 2.6D.

 

B.            Borrowing Mechanics.  Except for Revolving Loans made on the
Effective Date, Revolving Loans made on any Funding Date shall be in an
aggregate minimum amount of $1,000,000 and integral multiples of $100,000 in
excess of that amount.  Whenever Borrower desires that Lenders make Revolving
Loans, it shall deliver a Notice of Borrowing to Administrative Agent no later
than 1:00 P.M. (New York City time) at least three Business Days in advance of
the proposed Funding Date (in the case of a LIBOR Loan) or at least one Business
Day in advance of the proposed Funding Date (in the case of a Base Rate Loan). 
The Notice of Borrowing shall specify (i) the proposed Funding Date (which shall
be a Business Day), (ii) the amount and Type of Loans requested, (iii) in the
case of Revolving Loans not made on the Effective Date, whether such Loans shall
be Base Rate Loans or LIBOR Loans, (iv) in the case of any Loans requested to be
made as LIBOR Loans, the initial Interest Period requested therefore, and (v)
information about the account of Borrower to be credited.  Revolving Loans may
be continued as or converted into Base Rate Loans and LIBOR Loans in the manner
provided in subsection 2.2D.  In lieu of delivering the above-described Notice
of Borrowing, Borrower may give Administrative Agent telephonic notice by the
required time of any proposed borrowing under this subsection 2.1B; provided
that such notice shall be promptly confirmed in writing by delivery of a Notice
of Borrowing to Administrative Agent on the date such notice was given.

 

Neither Administrative Agent nor any Lender shall incur any liability to
Borrower in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Borrower or
for otherwise acting in good faith under this subsection 2.1B, and upon funding
of Revolving Loans by Lenders in accordance with this Agreement pursuant to any
such telephonic notice Borrower shall have effected Revolving Loans hereunder.

 

Borrower shall notify Administrative Agent prior to the funding of any Revolving
Loans in the event that any of the matters to which Borrower is required to
certify in the applicable Notice of Borrowing is no longer true and correct as
of the applicable Funding

 

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Date, and the acceptance by Borrower of the proceeds of any Revolving Loans
shall constitute a re-certification by Borrower, as of the applicable Funding
Date, as to the matters to which Borrower is required to certify in the
applicable Notice of Borrowing.

 

Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a Notice of
Borrowing for a LIBOR Loan (or telephonic notice in lieu thereof) shall be
irrevocable once Administrative Agent receives such notice, and Borrower shall
be bound to make a borrowing in accordance therewith.

 

C.            Disbursement of Funds.  All Revolving Loans under this Agreement
shall be made by Lenders simultaneously and proportionately to their respective
Pro Rata Shares, it being understood that neither Administrative Agent nor any
Lender shall be responsible for any default by any other Lender in that other
Lender’s obligation to make a Loan requested hereunder nor shall the Commitment
of any Lender to make the particular Type of Loan requested be increased or
decreased as a result of a default by any other Lender in that other Lender’s
obligation to make a Loan requested hereunder.  Promptly after receipt by
Administrative Agent of a Notice of Borrowing pursuant to subsection 2.1B (or
telephonic notice in lieu thereof) but not later than three Business Days prior
to the Funding Date of a LIBOR Loan and one Business Day prior to the Funding
Date of a Base Rate Loan, Administrative Agent shall notify each Lender of the
proposed borrowing.  Each Lender shall make the amount of its Loan available to
Administrative Agent not later than 12:00 Noon (New York City time) on the
applicable Funding Date in same day funds in Dollars, at the Administrative
Agent’s Office.  Except as provided in subsection 3.3B with respect to Revolving
Loans used to reimburse any Issuing Lender for the amount of a drawing under a
Letter of Credit issued by it, upon satisfaction or waiver of the conditions
precedent specified in subsections 4.1 (in the case of any Loans made on the
Effective Date) and 4.2 (in the case of all Loans), Administrative Agent shall
make the proceeds of such Loans available to Borrower on the applicable Funding
Date by causing an amount of same day funds in Dollars equal to the proceeds of
all such Loans received by Administrative Agent from Lenders to be credited to
an account of Borrower as specified in the applicable Notice of Borrowing.

 

Unless Administrative Agent shall have been notified by any Lender prior to the
Funding Date for any Loans that such Lender does not intend to make available to
Administrative Agent the amount of such Lender’s Loan requested on such Funding
Date, Administrative Agent may assume that such Lender has made such amount
available to Administrative Agent on such Funding Date and Administrative Agent
may, in its sole discretion, but shall not be obligated to, make available to
Borrower a corresponding amount on such Funding Date.  If such corresponding
amount is not in fact made available to Administrative Agent by such Lender,
Administrative Agent shall be entitled to recover such corresponding amount on
demand from such Lender together with interest thereon, for each day from such
Funding Date until the date such amount is paid to Administrative Agent, at the
customary rate set by Administrative Agent for the correction of errors among
banks for three Business Days and thereafter at the Base Rate.  If such Lender
does not pay such corresponding amount forthwith upon Administrative Agent’s
demand therefor, Administrative Agent shall promptly notify Borrower and
Borrower shall immediately pay such corresponding amount to Administrative Agent
together with interest thereon, for each day from such Funding Date until the
date such amount is paid to Administrative Agent, at the

 

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rate payable under this Agreement for Base Rate Loans.  Nothing in this
subsection 2.1C shall be deemed to relieve any Lender from its obligation to
fulfill its Commitments hereunder or to prejudice any rights that Borrower may
have against any Lender as a result of any default by such Lender hereunder.

 

D.            Optional Notes.  If so requested by any Lender by written notice
to Borrower (with a copy to Administrative Agent) at least two Business Days
prior to the Effective Date or at any time thereafter, Borrower shall execute
and deliver on the Effective Date or within three Business Days after receipt of
written request therefor to the requesting Lender, a Revolving Note
substantially in the form of Exhibit V annexed hereto to evidence that Lender’s
Revolving Loans, in the principal amount of that Lender’s Revolving Loan
Commitment and with other appropriate insertions.

 

Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes hereof unless and until an Assignment Agreement
effecting the assignment or transfer thereof shall have been accepted by
Administrative Agent as provided in subsection 11.1B(ii).  Any request,
authorization or consent of any Person who, at the time of making such request
or giving such authority or consent, is the holder of any Note shall be
conclusive and binding on any subsequent holder, assignee or transferee of that
Note or of any Note or Notes issued in exchange therefor.

 

E.             The Register.

 

(i)            Administrative Agent shall maintain, at its address referred to
in subsection 11.8, a copy of each Assignment Agreement delivered to it from
time to time in accordance with the provisions of subsection 11.1B and a
register for the recordation of the names and addresses of Lenders and the
Commitments and Loans of each Lender from time to time (the “Register”).  The
Register shall be available for inspection by Borrower at any reasonable time
and from time to time upon reasonable prior notice.

 

(ii)           Administrative Agent shall record in the Register the Revolving
Loan Commitment and the Revolving Loans from time to time of each Lender and
each repayment or prepayment in respect of the principal amount of the Revolving
Loans of each Lender.  Any such recordation shall be conclusive and binding on
Borrower and each Lender, absent manifest error; provided that failure to make
any such recordation, or any error in such recordation, shall not affect any
Lender’s Commitments or Borrower’s Obligations in respect of any applicable
Loans.

 

(iii)          Each Lender shall record on its internal records (including the
Notes held by such Lender) the amount of each Revolving Loan made by it and each
payment in respect thereof.  Any such recordation shall be conclusive and
binding on Borrower, absent manifest error; provided that failure to make any
such recordation, or any error in such recordation, shall not affect any
Lender’s Commitments or Borrower’s Obligations in respect of any applicable
Loans; and provided further that in the event of any inconsistency between the
Register and any Lender’s records, the recordations in the Register shall
govern.

 

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(iv)          Borrower, Administrative Agent and Lenders shall deem and treat
the Persons listed as Lenders in the Register as the holders and owners of the
corresponding Commitments and Loans listed therein for all purposes hereof, and
no assignment or transfer of any such Commitment or Loan shall be effective, in
each case unless and until an Assignment Agreement effecting the assignment or
transfer thereof shall have been accepted by Administrative Agent and recorded
in the Register as provided in subsection 11.1B(ii).  Prior to such recordation,
all amounts owed with respect to the applicable Commitment or Loan shall be owed
to the Lender listed in the Register as the owner thereof, and any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is listed in the Register as a Lender shall be
conclusive and binding on any subsequent holder, assignee or transferee of the
corresponding Commitments or Loans.

 

(v)           Borrower hereby designates CIBC to serve as Borrower’s agent
solely for purposes of maintaining the Register as provided in this subsection
2.1E, and Borrower hereby agrees that, to the extent CIBC serves in such
capacity, CIBC and its officers, directors, employees, agents and Affiliates
shall constitute Indemnitees for all purposes under subsection 11.3.

 

2.2                               Interest on the Loans.

 

A.            Rate of Interest.  Subject to the provisions of subsections 2.2F,
2.6 and 2.7, each Revolving Loan shall bear interest on the unpaid principal
amount thereof from the date made through maturity (whether by acceleration or
otherwise) or earlier repayment at a rate determined by reference to the Base
Rate or the Adjusted LIBOR.  The applicable basis for determining the rate of
interest with respect to any Revolving Loan shall be selected by Borrower
initially at the time a Notice of Borrowing is given with respect to such Loan
pursuant to subsection 2.1B.  The basis for determining the interest rate with
respect to any Revolving Loan may be changed from time to time pursuant to
subsection 2.2D.  If on any day a Revolving Loan is outstanding with respect to
which notice has not been delivered to Administrative Agent in accordance with
the terms of this Agreement specifying the applicable basis for determining the
rate of interest, then for that day that Loan shall bear interest determined by
reference to the Base Rate.

 

Subject to the provisions of subsections 2.2E, 2.2F, 2.7 and 2.10 the Revolving
Loans shall bear interest through maturity or earlier repayment as follows:

 

(i)            if a Base Rate Loan, then at the sum of the Base Rate plus the
Applicable Base Rate Margin, but in no event in excess of the maximum
nonusurious interest rate permitted by applicable law; or

 

(ii)           if a LIBOR Loan, then at the sum of the Adjusted LIBOR plus the
Applicable LIBOR Margin, but in no event in excess of the maximum nonusurious
interest rate permitted by applicable law.

 

Upon delivery of the Margin Determination Certificate by Borrower to
Administrative Agent pursuant to subsection 6.1(xi), the Applicable Base Rate
Margin and Applicable LIBOR

 

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Margin shall automatically be adjusted in accordance with such Margin
Determination Certificate, such adjustment to become effective on the third
Business Day after such Margin Determination Certificate is delivered to
Administrative Agent; provided that (1) at any time a Margin Determination
Certificate is not delivered at the time required pursuant to subsection
6.1(xi), from the time such Margin Determination Certificate was required to be
delivered until delivery of such Margin Determination Certificate, the
Applicable Base Rate Margin shall be 1.50% for the Revolving Loans, and the
Applicable LIBOR Margin shall be 3.00% for the Revolving Loans, and (2) if a
Margin Determination Certificate erroneously indicates an applicable margin more
favorable to Borrower than should be afforded by the actual calculation of the
Total Leverage Ratio, Borrower shall promptly pay additional interest and letter
of credit fees to correct for such error.

 

B.            Interest Periods.  In connection with each LIBOR Loan, Borrower
may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as the case may be, select an interest period (each an
“Interest Period”) to be applicable to such Loan, which Interest Period shall
be, at Borrower’s option, either a one, two, three or six month period; provided
that:

 

(i)            the initial Interest Period for any LIBOR Loan shall commence on
the Funding Date in respect of such Loan, in the case of a Loan initially made
as a LIBOR Loan, or on the date specified in the applicable Notice of
Conversion/Continuation, in the case of a Loan converted to a LIBOR Loan;

 

(ii)           in the case of immediately successive Interest Periods applicable
to a LIBOR Loan continued as such pursuant to a Notice of
Conversion/Continuation, each successive Interest Period shall commence on the
day on which the next preceding Interest Period expires;

 

(iii)          if an Interest Period would otherwise expire on a day that is not
a Business Day, such Interest Period shall expire on the next succeeding
Business Day; provided that, if any Interest Period would otherwise expire on a
day that is not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall expire on the next
preceding Business Day;

 

(iv)          any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall, subject to
clause (v) of this subsection 2.2B, end on the last Business Day of a calendar
month;

 

(v)           no Interest Period with respect to any portion of the Revolving
Loans shall extend beyond the then effective Revolving Loan Commitment
Termination Date;

 

(vi)          there shall be no more than fifteen Interest Periods outstanding
at any time; and

 

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(vii)         in the event Borrower fails to specify an Interest Period for any
LIBOR Loan in the applicable Notice of Borrowing or Notice of
Conversion/Continuation, Borrower shall be deemed to have selected an Interest
Period of one month.

 

C.            Interest Payments.  Subject to the provisions of subsection 2.2E
and 2.2F, interest on each Loan shall be payable in arrears on and to each
Interest Payment Date applicable to that Loan, upon any prepayment of that Loan
(to the extent accrued on the amount being prepaid) and at maturity (including
final maturity); provided that in the event any Loans that are Base Rate Loans
are prepaid pursuant to subsection 2.4A(i), interest accrued on such Loans
through the date of such prepayment shall be payable on the next succeeding
Interest Payment Date applicable to Base Rate Loans (or, if earlier, at final
maturity).

 

D.            Conversion or Continuation.  Subject to the provisions of
subsection 2.6, Borrower shall have the option (i) to convert at any time all or
any part of its outstanding Revolving Loans equal to $1,000,000 and integral
multiples of $100,000 in excess of that amount from Loans bearing interest at a
rate determined by reference to one basis to Loans bearing interest at a rate
determined by reference to an alternative basis or (ii) upon the expiration of
any Interest Period applicable to a LIBOR Loan, to continue all or any portion
of such Loan equal to $1,000,000 and integral multiples of $100,000 in excess of
that amount as a LIBOR Loan; provided, however, that if a LIBOR Loan is
converted into a Base Rate Loan on a date other than the expiration date of the
Interest Period applicable thereto, subsection 2.6D shall apply.

 

Borrower shall deliver a Notice of Conversion/Continuation to Administrative
Agent no later than 1:00 P.M. (New York City time) at least three Business Days
in advance of the proposed conversion date (in the case of a conversion to a
Base Rate Loan) and at least three Business Days in advance of the proposed
conversion/continuation date (in the case of a conversion to, or a continuation
of, a LIBOR Loan).  With respect to any Base Rate or LIBOR Loan, if Borrower
fails to deliver a Notice of Conversion/Continuation as described above or if
any proposed conversion/continuation under this subsection 2.2D is not permitted
hereunder, Borrower shall be deemed to have elected to convert such LIBOR Loan
to a Base Rate Loan on the last day of the then-expiring Interest Period and to
continue any such Base Rate Loan as a Base Rate Loan, as applicable.

 

A Notice of Conversion/Continuation shall specify (i) the proposed
conversion/continuation date (which shall be a Business Day), (ii) the amount
and Type of the Loan to be converted/continued, (iii) the nature of the proposed
conversion/continuation, (iv) in the case of a conversion to, or a continuation
of, a LIBOR Loan, the requested Interest Period, and (v) in the case of a
conversion to, or a continuation of, a LIBOR Loan, that no Event of Default has
occurred and is continuing.  In lieu of delivering the above-described Notice of
Conversion/Continuation, Borrower may give Administrative Agent telephonic
notice by the required time of any proposed conversion/continuation under this
subsection 2.2D, provided that Administrative Agent shall receive a Notice of
Conversion/Continuation to confirm such telephonic notice no later than 1:00
P.M. (New York City time) on the day on which such telephonic notice is given. 
Upon receipt of written or telephonic notice of any proposed
conversion/continuation under this subsection 2.2D, Administrative Agent shall

 

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promptly transmit such notice by telefacsimile or telephone to each Lender but
not later than two Business Days prior to the Funding Date of a LIBOR Loan and
one Business Day prior to the Funding Date of a Base Rate Loan.

 

Neither Administrative Agent nor any Lender shall incur any liability to
Borrower in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of Borrower or
for otherwise acting in good faith under this subsection 2.2D, and upon
conversion or continuation of the applicable basis for determining the interest
rate with respect to any Loans in accordance with this Agreement pursuant to any
such telephonic notice Borrower shall have effected a conversion or
continuation, as the case may be, hereunder.

 

Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a notice of a
proposed conversion to, or continuation of, a LIBOR Loan (whether by delivery of
a Notice of Conversion/Continuation or telephonic notice) shall be irrevocable
once Administrative Agent receives such notice, and Borrower shall be bound to
effect a conversion or continuation in accordance therewith.

 

E.             Default Rate.  Upon the occurrence and during the continuation of
any Event of Default, the outstanding principal amount of all Loans and, to the
extent permitted by applicable law, any interest payments thereon not paid when
due and any fees and other amounts then due and payable hereunder, shall
thereafter bear interest (including post-petition interest in any proceeding
under the Bankruptcy Code or other applicable bankruptcy laws) payable upon
demand at a rate that is 2.00% per annum in excess of the interest rate
otherwise payable under this Agreement with respect to the applicable Loans (or,
in the case of any such fees and other amounts, at a rate which is 2.00% per
annum in excess of the interest rate otherwise payable under this Agreement for
Base Rate Loans), but in no event in excess of the maximum nonusurious interest
rate permitted by applicable law; provided that, in the case of LIBOR Loans,
upon the expiration of the Interest Period in effect at the time any such
increase in interest rate is effective such LIBOR Loans shall thereupon become
Base Rate Loans and shall thereafter bear interest payable upon demand at a rate
which is 2.00% per annum in excess of the interest rate otherwise payable under
this Agreement for Base Rate Loans, but in no event in excess of the maximum
nonusurious interest rate permitted by applicable law.  Payment or acceptance of
the increased rates of interest provided for in this subsection 2.2E is not a
permitted alternative to timely payment and shall not constitute a waiver of any
Event of Default or otherwise prejudice or limit any rights or remedies of
Administrative Agent or any Lender.

 

F.             Computation of Interest.  Interest on the Loans shall be computed
(i) in the case of Base Rate Loans, on the basis of a 365-day year (or 366-day
year, in the case of a leap year), and (ii) in the case of LIBOR Loans, on the
basis of a 360-day year, in each case for the actual number of days elapsed in
the period during which it accrues.  In computing interest on any Loan, the date
of the making of such Loan or the first day of an Interest Period applicable to
such Loan or, with respect to a Base Rate Loan being converted from a LIBOR
Loan, the date of conversion of such LIBOR Loan to such Base Rate Loan, as the
case may be, shall be included, and the date of payment or repayment of such
Loan or the expiration date of an Interest Period applicable to such Loan or,
with respect to a Base Rate Loan being converted

 

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to a LIBOR Loan, the date of conversion of such Base Rate Loan to such LIBOR
Loan, as the case may be, shall be excluded; provided that if a Loan is repaid
on the same day on which it is made, one day’s interest shall be paid on that
Loan.

 

2.3                               Fees.

 

A.            Commitment Fee.  Borrower agrees to pay to Administrative Agent,
for distribution to each Lender in proportion to that Lender’s Pro Rata Share of
the Revolving Loan Commitments, commitment fees for the period from and
including the Effective Date to and excluding the Revolving Loan Commitment
Termination Date equal to the average of the daily excess of the Revolving Loan
Commitments over the Total Utilization of Revolving Loan Commitments multiplied
by (i)  0.625% per annum, if the Total Utilization of Revolving Loan Commitments
is equal to or less than 33% of the Revolving Loan Commitments, (ii) 0.50% per
annum, if the Total Utilization of Revolving Loan Commitments is greater than
33% but less than or equal to 67% of the Revolving Loan Commitments or
(iii) 0.375% per annum, if the Total Utilization of Revolving Loan Commitments
is greater than 67% of the Revolving Loan Commitments; such commitment fees to
be calculated on the basis of a 360-day year and the actual number of days
elapsed and to be payable quarterly in arrears on the last Business Day of each
March, June, September and December of each Fiscal Year commencing on the first
such date to occur after the Effective Date, and on the Revolving Loan
Commitment Termination Date.

 

B.            Other Fees.  Borrower agrees to pay to Administrative Agent such
fees in the amounts and at the times separately agreed upon in writing between
Borrower and Administrative Agent.

 

2.4                               Repayments and Prepayments; General Provisions
Regarding Payments; Application of Proceeds of Collateral and Payments Under
Subsidiary Guaranty.

 

A.            Prepayments and Unscheduled Reductions in Revolving Loan
Commitments.

 

(i)            Voluntary Prepayments.  Borrower may, upon not less than one
Business Day’s prior written notice, given to Administrative Agent by 12:00 Noon
(New York City time) on the date required (which written notice Administrative
Agent will promptly transmit by telefacsimile or telephone to each Lender), at
any time and from time to time prepay any Revolving Loans on any Business Day in
whole or in part in an aggregate minimum amount of $1,000,000 and integral
multiples of $100,000 in excess of that amount; provided, however, that any
LIBOR Loan may be prepaid on a day other than the expiration of the Interest
Period applicable thereto, only if Borrower pays the amounts due pursuant to
subsection 2.6D caused by such prepayment.  Notice of prepayment having been
given as aforesaid, the principal amount of the Loans specified in such notice
shall become due and payable on the prepayment date specified therein.  Any such
voluntary prepayment shall be applied as specified in subsection 2.4A(iv).

 

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(ii)           Voluntary Reductions of Revolving Loan Commitments.  Borrower
may, upon not less than three Business Days’ prior written notice to
Administrative Agent (which written notice Administrative Agent will promptly
transmit by telefacsimile or telephone to each Lender), at any time and from
time to time terminate in whole or permanently reduce in part, without premium
or penalty, the Revolving Loan Commitments in an amount up to the amount by
which the Revolving Loan Commitments exceed the Total Utilization of Revolving
Loan Commitments at the time of such proposed termination or reduction; provided
that any such partial reduction of the Revolving Loan Commitments shall be in an
aggregate minimum amount of $1,000,000 and integral multiples of $100,000 in
excess of that amount.  Borrower’s notice to Administrative Agent shall
designate the date (which shall be a Business Day) of such termination or
reduction and the amount of any partial reduction, and such termination or
reduction of the Revolving Loan Commitments shall be effective on the date
specified in Borrower’s notice and shall reduce the Revolving Loan Commitment of
each Lender proportionately to its Pro Rata Share.  The amount of the Revolving
Loan Commitments terminated or reduced hereunder shall not be reinstated.

 

(iii)          Mandatory Prepayments.  The Loans shall be prepaid under the
circumstances set forth below, all such prepayments to be applied as set forth
below or as more specifically provided in subsection 2.4A(iv):

 

(a)           Prepayments From Net Asset Sale Proceeds.  No later than one
Business Day after the date of receipt by Holdings or any of its Subsidiaries of
any Net Asset Sale Proceeds, Borrower shall prepay the Revolving Loans (without
any reduction of the Revolving Loan Commitments) by an amount equal to such Net
Asset Sale Proceeds.

 

(b)           Prepayments and Revolving Loan Commitment Reductions Due to
Issuance of Debt or Equity Securities.  On the first Business Day after the date
of receipt by Holdings or any of its Subsidiaries of Net Securities Proceeds,
Borrower shall prepay the Revolving Loans by an amount equal to such Net
Securities Proceeds (without any reduction of the Revolving Loan Commitments).

 

(c)           Calculations of Net Proceeds Amounts and Additional Prepayments on
Subsequent Calculations.  Concurrently with any prepayment of the Loans pursuant
to subsections 2.4A(iii)(a) or (b), Borrower shall deliver to Administrative
Agent an Officers’ Certificate demonstrating the calculation of the amount (the
“Net Proceeds Amount”) of the applicable Net Asset Sale Proceeds or the Net
Securities Proceeds that gave rise to such prepayment and in the case of Net
Asset Sale Proceeds arising as a result of the sale of any Collateral securing
the Secured Obligations (as defined in the Collateral Documents), certifying
that no event of default then exists with respect to such Secured Obligations. 
In the event that no event of default then exists, such Net Asset Sale Proceeds
shall be applied in accordance with the terms of this Agreement.  In the event
that an event of default then exists with respect to any

 

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of the Secured Obligations, such Net Asset Sale Proceeds shall be held by
Administrative Agent in a collateral account for the benefit of all of the
holders of the Secured Obligations until such time as either no event of default
exists with respect to such Secured Obligations (in which case such Net Asset
Sale Proceeds shall be applied in accordance with the terms of this Agreement)
or until otherwise applied as required under subsection 2.4C(i).  In the event
that Borrower shall subsequently determine that the actual Net Proceeds Amount
was greater than the amount set forth in such Officers’ Certificate (including
if any actual taxes to be paid as a result of an Asset Sale are less than the
estimated taxes to be paid as a result of such Asset Sale), Borrower shall
promptly make an additional prepayment of the Loans in an amount equal to the
amount of such excess, and Borrower shall concurrently therewith deliver to
Administrative Agent an Officers’ Certificate demonstrating the derivation of
the additional Net Proceeds Amount resulting in such excess.

 

(d)           Prepayments Due to Restrictions on Revolving Loan Commitments. 
Borrower shall from time to time prepay the Revolving Loans to the extent
necessary so that the Total Utilization of Revolving Loan Commitments shall (1)
not exceed the Revolving Loan Commitments then in effect or (2) result in the
sum of Cash and Cash Equivalents being equal to or less than $25,000,000 on the
fifth Business Day after a borrowing of Revolving Loans; provided that for
purposes of making the determinations provided for in this clause (2), Cash and
Cash Equivalents which constitute Excess Senior Note Proceeds which are being
held by Borrower pending the application of such proceeds to the repayment,
repurchase or redemption of Senior Notes shall be excluded from such
determinations.

 

(iv)          Application of Prepayments.

 

(a)           Application of Voluntary Prepayments.  Subject to the provisions
of subsection 2.4C, any voluntary prepayments pursuant to subsection 2.4A(i)
shall be applied as specified by Borrower in the applicable notice of
prepayment.

 

(b)           Application of Prepayments to Base Rate Loans and LIBOR Loans. 
Unless the application of such prepayment is otherwise designated by Borrower,
any prepayment of Loans shall be applied first to Base Rate Loans to the full
extent thereof before application to LIBOR Loans, in each case in a manner which
minimizes the amount of any payments required to be made by Borrower pursuant to
subsection 2.6D.

 

B.            General Provisions Regarding Payments.

 

(i)            Manner and Time of Payment.  All payments by Borrower of
principal, interest, fees and other Obligations hereunder and under the Notes
shall be made in Dollars in same day funds, without defense, setoff or
counterclaim, free of any restriction or condition, and delivered to
Administrative Agent not later than 3:00 P.M.

 

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(New York City time) on the date due at the Administrative Agent’s Office for
the account of Lenders; funds received by Administrative Agent after that time
on such due date shall be deemed to have been paid by Borrower on the next
succeeding Business Day.  Borrower hereby authorizes Administrative Agent to
charge its account with Administrative Agent in order to cause timely payment to
be made to Administrative Agent of all principal, interest, fees and expenses
due hereunder (subject to sufficient funds being available in their accounts for
that purpose).

 

(ii)           Application of Payments.  Prior to any payments being applied to
principal or interest under this Agreement, such payments shall first be applied
to any outstanding and payable fees, costs, expenses, indemnities or other
amounts (aside from principal or interest due under the Loan Documents), as
determined in the reasonable opinion of Administrative Agent.

 

(iii)          Application of Payments to Principal and Interest.  Except as
provided in subsection 2.2C, all payments in respect of the principal amount of
any Loan shall include payment of accrued interest on the principal amount being
repaid or prepaid, and all such payments (and, in any event, any payments in
respect of any Loan on a date when interest is due and payable with respect to
such Loan) shall be applied to the payment of interest before application to
principal.

 

(iv)          Apportionment of Payments.  Aggregate principal and interest
payments in respect of Revolving Loans shall be apportioned among all
outstanding Loans to which such payments relate, in each case proportionately to
Lenders’ respective Pro Rata Shares.  Administrative Agent shall promptly
distribute to each Lender, at its primary address set forth below its name on
the appropriate signature page hereof or at such other address as such Lender
may request, its Pro Rata Share of all such payments received by Administrative
Agent and the commitment fees of such Lender when received by Administrative
Agent pursuant to subsection 2.3.  Notwithstanding the foregoing provisions of
this subsection 2.4B(iv), if, pursuant to the provisions of subsection 2.6C, any
Notice of Conversion/Continuation is withdrawn as to any Affected Lender or if
any Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any
LIBOR Loans, Administrative Agent shall give effect thereto in apportioning
payments received thereafter.

 

(v)           Payments on Business Days.  Subject to subsection 2.2B(iii),
whenever any payment to be made hereunder shall be stated to be due on a day
that is not a Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall be included in the computation of
the payment of interest hereunder or of the commitment fees hereunder, as the
case may be.

 

(vi)          Notation of Payment.  Each Lender agrees that before disposing of
any Note held by it, or any part thereof (other than by granting participations
therein), that Lender will make a notation thereon of all Loans evidenced by
that Note and all principal payments previously made thereon and of the date to
which interest thereon has been paid; provided that the failure to make (or any
error in the making of) a notation of any Loan made under such Note shall not
limit or otherwise affect the

 

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obligations of Borrower hereunder or under such Note with respect to any Loan or
any payments of principal or interest on such Note.

 

C.            Application of Proceeds of Collateral and Payments Under
Guaranties.

 

(i)            Application of Certain Payments; Application of Proceeds of
Collateral.  Except as provided in subsection 2.4A(iii)(c) with respect to
prepayments from Net Asset Sale Proceeds, all proceeds received by
Administrative Agent in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral under any Collateral Document
after the occurrence of an event of default with respect to any of the Secured
Obligations may, in the discretion of Administrative Agent, be held by
Administrative Agent as Collateral for, and/or (then or at any time thereafter)
applied in full or in part by Administrative Agent against, the applicable Loan
Obligations (as defined in such Collateral Document) in the following order of
priority:

 

(a)           To the payment of all costs and expenses of such sale, collection
or other realization, including reasonable out-of-pocket costs and expenses to
Administrative Agent and its agents and counsel, and all other expenses,
liabilities and advances made or incurred by Administrative Agent in connection
therewith, and all amounts for which Administrative Agent is entitled to
indemnification under such Collateral Document and all advances made by
Administrative Agent thereunder for the account of the applicable Loan Party,
and to the payment of all costs and expenses paid or incurred by Administrative
Agent in connection with the exercise of any right or remedy under such
Collateral Document, all in accordance with the terms of this Agreement and such
Collateral Document;

 

(b)           thereafter, to the extent of any excess such proceeds, to the
payment of all other Loan Obligations (as defined in such Collateral Document)
for the equal and ratable benefit of the holders thereof; and

 

(c)           thereafter, to the extent of any excess such proceeds, to the
payment to or upon the order of such Loan Party or to whosoever may be lawfully
entitled to receive the same or as a court of competent jurisdiction may direct.

 

(ii)           Application of Payments Under Guaranties.  All payments received
by Administrative Agent under the Guaranties after the occurrence of an Event of
Default shall be applied promptly from time to time by Administrative Agent in
the following order of priority:

 

(a)           To the payment of the costs and expenses of any collection or
other realization under the Guaranty, including reasonable out-of-pocket costs
and expenses to Administrative Agent and its counsel, and all expenses,
liabilities and advances made or incurred by Administrative Agent in connection
therewith, all in accordance with the terms of this Agreement and the Guaranty;

 

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(b)           thereafter, to the extent of any excess such payments, to the
payment of all other Guarantied Obligations (as defined in such Guaranty) for
the ratable benefit of the holders thereof; and

 

(c)           thereafter, to the extent of any excess such payments, to the
payment to the applicable guarantor or to whosoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may direct.

 

2.5                               Use of Proceeds.

 

A.            Revolving Loans.  The proceeds of the Revolving Loans shall be
applied for general corporate purposes, including working capital, capital
expenditures, acquisitions and investments.

 

B.            Margin Regulations.  No portion of the proceeds of any borrowing
under this Agreement shall be used in any manner that might cause the borrowing
or the application of such proceeds to violate Regulation T, Regulation U or
Regulation X of the Board of Governors of the Federal Reserve System or any
other regulation of such Board or to violate the Exchange Act, in each case as
in effect on the date or dates of such borrowing and such use of proceeds.

 

2.6                               Special Provisions Governing LIBOR Loans.

 

Notwithstanding any other provision of this Agreement to the contrary, the
following provisions shall govern with respect to LIBOR Loans as to the matters
covered:

 

A.            Determination of Applicable Interest Rate.  As soon as practicable
after 12:00 Noon (New York City time) on each Interest Rate Determination Date,
Administrative Agent shall determine (which determination shall, absent manifest
error, be final, conclusive and binding upon all parties) the interest rate that
shall apply to the LIBOR Loans for which an interest rate is then being
determined for the applicable Interest Period and shall promptly give notice
thereof (in writing or by telephone confirmed in writing) to Borrower and each
Lender.

 

B.            Inability to Determine Applicable Interest Rate.  In the event
that Administrative Agent shall have determined (which determination shall be
final and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any LIBOR Loans, that by reason of
circumstances affecting the interbank Eurodollar market adequate and fair means
do not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted LIBOR, Administrative Agent
shall on such date give notice (by telefacsimile or by telephone confirmed in
writing) to Borrower and each Lender of such determination, whereupon (i) no
Loans may be made as, or converted to, LIBOR Loans until such time as
Administrative Agent notifies Borrower and Lenders that the circumstances giving
rise to such notice no longer exist and (ii) any Notice of Borrowing or Notice
of Conversion/Continuation given by Borrower with respect to the Loans in
respect of which such determination was made shall be deemed to be rescinded by
Borrower.

 

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C.            Illegality or Impracticability of LIBOR Loans.  In the event that
on any date any Lender shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto but shall be made only after
consultation with Borrower and Administrative Agent) that the making,
maintaining or continuation of its LIBOR Loans (i) has become unlawful as a
result of compliance by such Lender in good faith with any law, treaty,
governmental rule, regulation, guideline or order (or would conflict with any
such treaty, governmental rule, regulation, guideline or order not having the
force of law even though the failure to comply therewith would not be unlawful)
or (ii) has become impracticable, or would cause such Lender material hardship,
as a result of contingencies occurring after the date of this Agreement which
materially and adversely affect the interbank Eurodollar market or the position
of such Lender in that market, then, and in any such event, such Lender shall be
an “Affected Lender” and it shall on that day give notice (by telefacsimile or
by telephone confirmed in writing) to Borrower and Administrative Agent of such
determination (which notice Administrative Agent shall promptly transmit to each
other Lender).  Thereafter (a) the obligation of Affected Lender to make Loans
as, or to convert Loans to, LIBOR Loans shall be suspended until such notice
shall be withdrawn by Affected Lender, (b) to the extent such determination by
Affected Lender relates to a LIBOR Loan then being requested by Borrower
pursuant to a Notice of Borrowing or a Notice of Conversion/Continuation,
Affected Lender shall make such Loan as (or convert such Loan to, as the case
may be) a Base Rate Loan, (c) Affected Lender’s obligation to maintain its
outstanding LIBOR Loans (the “Affected Loans”) shall be terminated at the
earlier to occur of the expiration of the Interest Period then in effect with
respect to the Affected Loans or when required by law, and (d) the Affected
Loans shall automatically convert into Base Rate Loans on the date of such
termination.  Notwithstanding the foregoing, to the extent a determination by an
Affected Lender as described above relates to a LIBOR Loan then being requested
by Borrower pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, Borrower shall have the option, subject to the
provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice of
Conversion/Continuation as to all Lenders by giving notice (by telefacsimile or
by telephone confirmed in writing) to Administrative Agent of such rescission on
the date on which Affected Lender gives notice of its determination as described
above (which notice of rescission Administrative Agent shall promptly transmit
to each other Lender).  Except as provided in the immediately preceding
sentence, nothing in this subsection 2.6C shall affect the obligation of any
Lender other than an Affected Lender to make or maintain Loans as, or to convert
Loans to, LIBOR Loans in accordance with the terms of this Agreement.

 

D.            Compensation For Breakage or Non-Commencement of Interest
Periods.  Borrower shall compensate each Lender, upon written request by that
Lender made within six months after the occurrence of the circumstances giving
rise to such compensation (which request shall set forth the basis for
requesting such amounts), for all reasonable losses, expenses and liabilities
(including any interest paid by that Lender to lenders of funds borrowed by it
to make or carry its LIBOR Loans and any loss, expense or liability sustained by
that Lender in connection with the liquidation or re-employment of such funds)
which that Lender may sustain: (i) if for any reason (other than a default by
that Lender) a borrowing of any LIBOR Loan does not occur on a date specified
therefor in a Notice of Borrowing or a telephonic request for borrowing, or a
conversion to or continuation of any LIBOR Loan does not occur on a date
specified therefor in a Notice of Conversion/Continuation or a telephonic

 

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request for conversion or continuation, (ii) if any prepayment (including any
prepayment pursuant to subsection 2.4A(i)) or other principal payment or any
conversion of any of its LIBOR Loans occurs on a date prior to the last day of
an Interest Period applicable to that Loan, (iii) if any prepayment of any of
its LIBOR Loans is not made on any date specified in a notice of prepayment
given by Borrower, or (iv) as a consequence of any other default by Borrower in
the repayment of its LIBOR Loans when required by the terms of this Agreement.

 

E.             Booking of LIBOR Loans.  Any Lender may make, carry or transfer
LIBOR Loans at, to, or for the account of any of its branch offices or the
office of an Affiliate of that Lender.

 

F.             Assumptions Concerning Funding of LIBOR Loans.  Calculation of
all amounts payable to a Lender under this subsection 2.6 and under subsection
2.7A shall be made as though that Lender had actually funded each of its
relevant LIBOR Loans through the purchase of a Eurodollar deposit bearing
interest at the rate obtained pursuant to clause (x) of the definition of
Adjusted LIBOR in an amount equal to the amount of such LIBOR Loan and having a
maturity comparable to the relevant Interest Period and through the transfer of
such Eurodollar deposit from an offshore office of that Lender to a domestic
office of that Lender in the United States of America; provided, however, that
each Lender may fund each of its LIBOR Loans in any manner it sees fit and the
foregoing assumptions shall be utilized only for the purposes of calculating
amounts payable under this subsection 2.6 and under subsection 2.7A.

 

G.            LIBOR Loans After Default.  After the occurrence of and during the
continuation of an Event of Default, (i) Borrower may not elect to have a Loan
be made or continued as, or converted to, a LIBOR Loan after the expiration of
any Interest Period then in effect for that Loan and (ii) subject to the
provisions of subsection 2.6D, any Notice of Borrowing or Notice of Conversion/
Continuation given by Borrower with respect to a requested borrowing or
conversion/ continuation that has not yet occurred shall be deemed to be
rescinded by Borrower.

 

2.7                               Increased Costs; Taxes; Capital Adequacy.

 

A.            Compensation for Increased Costs and Taxes.  Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto) that any law, treaty or governmental rule, regulation
or order, or any change therein or in the interpretation, administration or
application thereof (including the implementation of any new law, treaty or
governmental rule, regulation or order), or any determination of a court or
governmental authority, in each case that becomes effective after the date
hereof, or compliance by such Lender with any guideline, request or directive
issued or made after the date hereof by any central bank or other governmental
or quasi-governmental authority (whether or not having the force of law):

 

(i)            subjects such Lender (or its applicable lending office) to any
additional Tax with respect to this Agreement or any of its obligations
hereunder or any payments

 

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to such Lender (or its applicable lending office) of principal, interest, fees
or any other amount payable hereunder;

 

(ii)           imposes, modifies or holds applicable any reserve (including any
marginal, emergency, supplemental, special or other reserve), special deposit,
compulsory loan, FDIC insurance or similar requirement against assets held by,
or deposits or other liabilities in or for the account of, or advances or loans
by, or other credit extended by, or any other acquisition of funds by, any
office of such Lender (other than any such reserve or other requirements with
respect to LIBOR Loans that are reflected in the definition of Adjusted LIBOR);
or

 

(iii)          imposes any other condition (other than with respect to a Tax
matter) on or affecting such Lender (or its applicable lending office) or its
obligations hereunder or the interbank Eurodollar market;

 

and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining Loans hereunder or to reduce any amount
received or receivable by such Lender (or its applicable lending office) with
respect thereto; then, in any such case, Borrower shall promptly pay to such
Lender, upon receipt of the statement referred to in the next sentence, such
additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder.  Such Lender shall deliver to Borrower (with a copy to Administrative
Agent) a written statement within six months after the occurrence of the
circumstances giving rise to such additional amounts, setting forth in
reasonable detail the basis for calculating the additional amounts owed to such
Lender under this subsection 2.7A, which statement shall be conclusive and
binding upon all parties hereto absent manifest error.

 

B.            Withholding of Taxes.

 

(i)            Payments to Be Free and Clear.  Unless otherwise required by
applicable law, all sums payable by Borrower under this Agreement and the other
Loan Documents shall be paid free and clear of, and without any deduction or
withholding on account of, any Tax imposed, levied, collected, withheld or
assessed by or within the United States of America or any political subdivision
in or of the United States of America or any other jurisdiction from or to which
a payment is made by or on behalf of Borrower.

 

(ii)           Grossing-up of Payments.  If Borrower or any other Person is
required by law to make any deduction or withholding on account of any such Tax
from any sum paid or payable by Borrower to Administrative Agent or any Lender
under any of the Loan Documents:

 

(a)           Borrower shall notify Administrative Agent of any such requirement
or any change in any such requirement as soon as Borrower becomes aware of it;

 

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(b)           Borrower shall pay any such Tax when such Tax is due, regardless
of whether the liability for payment of such Tax (i) is imposed on Borrower
itself, Administrative Agent or any Lender or (ii) relates to any portion of any
sums paid or payable to any Lender under any of the Loan Documents with respect
to which such Lender does not act for its own account;

 

(c)           the sum payable by Borrower in respect of which the relevant
deduction, withholding or payment is required shall be increased to the extent
necessary to ensure that, after the making of that deduction, withholding or
payment, Administrative Agent or such Lender, as the case may be, receives on
the due date a net sum equal to what it would have received had no such
deduction, withholding or payment been required or made; and

 

(d)           within 30 days after paying any sum from which it is required by
law to make any deduction or withholding, and within 30 days after the due date
of payment of any Tax which it is required by clause (b) above to pay, Borrower
shall deliver to Administrative Agent evidence satisfactory to the other
affected parties of such deduction, withholding or payment and of the remittance
thereof to the relevant taxing or other authority;

 

provided that no such additional amount shall be required to be paid to any
Lender under clause (c) above (i) to the extent such additional amount relates
to a portion of any sums paid or payable to such Lender under any of the Loan
Documents with respect to which such Lender does not act for its own account, or
(ii) except to the extent that any change after the date such Lender became a
Lender in any such requirement for a deduction, withholding or payment as is
mentioned therein shall result in an increase in the rate of such deduction,
withholding or payment from that in effect at the date on which such Lender
became a Lender, in respect of payments to such Lender.

 

(iii)          Evidence of Exemption from U.S. Withholding Tax.

 

(a)           Each Lender that is organized under the laws of any jurisdiction
other than the United States or any state or other political subdivision thereof
(for purposes of this subsection 2.7B(iii), a “Non-US Lender”) shall deliver to
Administrative Agent and to Borrower, on or prior to the Effective Date (in the
case of each Lender party hereto on the Effective Date) or on or prior to the
date of the Assignment Agreement pursuant to which it becomes a Lender (in the
case of each other Lender), and at such other times as may be necessary in the
determination of Borrower or Administrative Agent (each in the reasonable
exercise of its discretion), two original copies of Internal Revenue Service
Form W-8BEN or W-8ECI (or any successor forms) properly completed and duly
executed by such Lender, or, in the case of a Non-US Lender claiming exemption
from United States federal withholding tax under Section 871(h) or 881(c) of the
Internal Revenue Code with respect to payments of “portfolio interest”, a form
W-8BEN, and, in the case of a Lender that has certified in writing to
Administrative Agent that it is not a “bank” (as defined in Section

 

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881(c)(3)(A) of the Internal Revenue Code), a certificate of such Lender
certifying that such Lender is not (i) a “bank” for purposes of Section 881(c)
of the Internal Revenue Code, (ii) a ten-percent shareholder (within the meaning
of Section 871(h)(3)(B) of the Internal Revenue Code) of Borrower or Holdings,
or (iii) a controlled foreign corporation related to Borrower or Holdings
(within the meaning of Section 864(d)(4) of the Internal Revenue Code) in each
case together with any other certificate or statement of exemption required
under the Internal Revenue Code or the regulations issued thereunder to
establish that such Lender is not subject to United States withholding tax with
respect to any payments to such Lender of interest payable under any of the Loan
Documents.

 

(b)           Each Non-US Lender, to the extent it does not act or ceases to act
for its own account with respect to any portion of any sums paid or payable to
such Lender under any of the Loan Documents (for example, in the case of a
typical participation by such Lender), shall deliver to Administrative Agent and
to Borrower, on or prior to the Effective Date (in the case of each Lender party
hereto on the Effective Date), on or prior to the date of the Assignment
Agreement pursuant to which it becomes a Lender (in the case of each other
Lender), or on such later date when such Lender ceases to act for its own
account with respect to any portion of any such sums paid or payable, and at
such other times as may be necessary in the determination of Borrower or
Administrative Agent (each in the reasonable exercise of its discretion), (1)
two original copies of the forms or statements required to be provided by such
Lender under subsection 2.7B(iii)(a), properly completed and duly executed by
such Lender, to establish the portion of any such sums paid or payable with
respect to which such Lender acts for its own account that is not subject to
United States withholding tax, and (2) two original copies of Internal Revenue
Service Form W-8IMY (or any successor forms) properly completed and duly
executed by such Lender, together with any information, if any, such Lender
chooses to transmit with such form, and any other certificate or statement of
exemption required under the Internal Revenue Code or the regulations issued
thereunder, to establish that such Lender is not acting for its own account with
respect to a portion of any such sums payable to such Lender.

 

(c)           Each Non-US Lender hereby agrees, from time to time after the
initial delivery by such Lender of such forms, whenever a lapse in time or
change in circumstances renders such forms, certificates or other evidence so
delivered obsolete or inaccurate in any material respect or in the event that,
by virtue of a change in law or regulations, such forms are no longer valid
evidence of a person’s exemption from withholding tax which is reasonably
satisfactory to the Borrower, that such Lender shall promptly (1) deliver to
Administrative Agent and to Borrower two original copies of renewals, amendments
or additional or successor forms, properly completed and duly executed by such
Lender, together with any other certificate or statement of exemption required
in order to confirm or establish that such Lender is not subject to United
States withholding tax with respect to payments to such

 

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Lender under the Loan Documents and, as the case may be, that such Lender does
not act for its own account with respect to any portion of any such payments, or
(2) notify Administrative Agent and Borrower of its inability to deliver any
such forms, certificates or other evidence.

 

(d)           Borrower shall not be required to pay any additional amount to any
Non-US Lender under clause (c) of subsection 2.7B(ii) if such Lender shall have
failed to satisfy the requirements of clause (a), (b) or (c)(1) of this
subsection 2.7B(iii); provided that if such Lender shall have satisfied the
requirements of subsection 2.7B(iii)(a) on the date such Lender became a Lender,
nothing in this subsection 2.7B(iii)(d) shall relieve Borrower of its obligation
to pay any amounts pursuant to subsection 2.7B(ii)(c) in the event that, as a
result of any change in any applicable law, treaty or governmental rule,
regulation or order, or any change in the interpretation, administration or
application thereof, such Lender is no longer properly entitled to deliver
forms, certificates or other evidence at a subsequent date establishing the fact
that such Lender is not subject to withholding as described in subsection
2.7B(iii)(a).

 

C.            Capital Adequacy Adjustment.  If any Lender shall have determined
that the adoption, effectiveness, phase-in or applicability after the date
hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the force of law) of
any such governmental authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of, or with reference
to, such Lender’s Loans or Commitments or Letters of Credit or participations
therein or other obligations hereunder with respect to the Loans or the Letters
of Credit to a level below that which such Lender or such controlling
corporation could have achieved but for such adoption, effectiveness, phase-in,
applicability, change or compliance (taking into consideration the policies of
such Lender or such controlling corporation with regard to capital adequacy),
then from time to time, within five Business Days after receipt by Borrower from
such Lender of the statement referred to in the next sentence, Borrower shall
pay to such Lender such additional amount or amounts as will compensate such
Lender or such controlling corporation on an after-tax basis for such reduction.
Such Lender shall deliver to Borrower (with a copy to Administrative Agent) a
written statement within six months after the occurrence of the circumstances
giving rise to such additional amounts, setting forth in reasonable detail the
basis of the calculation of such additional amounts, which statement shall be
conclusive and binding upon all parties hereto absent manifest error.

 

2.8                               Obligation of Lenders and Issuing Lenders to
Mitigate.

 

Each Lender and Issuing Lender agrees that, as promptly as practicable after the
officer of such Lender or Issuing Lender responsible for administering the Loans
or Letters of Credit of such Lender or Issuing Lender, as the case may be,
becomes aware of the occurrence of an event or the existence of a condition that
would cause such Lender to become an Affected

 

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Lender or that would entitle such Lender or Issuing Lender to receive payments
under subsection 2.7 or subsection 3.6, it will, to the extent not inconsistent
with the internal policies of such Lender or Issuing Lender and any applicable
legal or regulatory restrictions, use reasonable efforts (i) to make, issue,
fund or maintain the Commitments of such Lender or the affected Loans or Letters
of Credit of such Lender or Issuing Lender through another lending or letter of
credit office of such Lender or Issuing Lender, or (ii) take such other measures
as such Lender or Issuing Lender may deem reasonable, if as a result thereof the
circumstances which would cause such Lender to be an Affected Lender would cease
to exist or the additional amounts which would otherwise be required to be paid
to such Lender or Issuing Lender pursuant to subsection 2.7 or subsection 3.6
would be materially reduced and if, as determined by such Lender or Issuing
Lender in its sole discretion, the making, issuing, funding or maintaining of
such Commitments or Loans or Letters of Credit through such other lending or
letter of credit office or in accordance with such other measures, as the case
may be, would not otherwise materially adversely affect such Commitments or
Loans or Letters of Credit or the interests of such Lender or Issuing Lender;
provided that such Lender or Issuing Lender will not be obligated to utilize
such other lending or letter of credit office pursuant to this subsection 2.8
unless Borrower agrees to pay all incremental expenses incurred by such Lender
or Issuing Lender as a result of utilizing such other lending or letter of
credit office as described in clause (i) above.  A certificate as to the amount
of any such expenses payable by Borrower pursuant to this subsection 2.8
(setting forth in reasonable detail the basis for requesting such amount)
submitted by such Lender or Issuing Lender to Borrower (with a copy to
Administrative Agent) shall be conclusive absent manifest error.

 

2.9                               Replacement of a Lender.

 

If Borrower receives a statement of amounts due pursuant to subsection 2.7A or
2.7C from a Lender or a Lender of Revolving Loans defaults in its obligations to
fund a Revolving Loan pursuant to this Agreement, or a Lender becomes an
Affected Lender (any such Lender, a “Subject Lender”), so long as (i) no
Potential Event of Default or Event of Default shall have occurred and be
continuing and Borrower has obtained a commitment from another Lender or an
Eligible Assignee to purchase at par the Subject Lender’s Loans and assume the
Subject Lender’s Commitments and all other obligations of the Subject Lender
hereunder, (ii) such Lender is not an Issuing Lender with respect to any Letters
of Credit outstanding (unless all such Letters of Credit are terminated or
arrangements reasonably acceptable to such Issuing Lender (such as a
“back-to-back” letter of credit) are made) and (iii) if applicable, the Subject
Lender is unwilling to withdraw the statement delivered to Borrower pursuant to
subsection 2.7 and/or is unwilling to remedy its default upon 10 days prior
written notice to the Subject Lender and Administrative Agent, Borrower may
require the Subject Lender to assign all of its Loans and Commitments to such
other Lender, Lenders, Eligible Assignee or Eligible Assignees pursuant to the
provisions of subsection 11.1B; provided that, prior to or concurrently with
such replacement, (1) the Subject Lender shall have received payment in full of
all principal, interest, fees and other amounts (including all amounts under
subsections 2.6D and/or 2.7 (if applicable)) through such date of replacement
and a release from its obligations under the Loan Documents, (2) any processing
fee required to be paid by subsection 11.1B(i) shall have been paid to
Administrative Agent, and (3) all of the requirements for such assignment
contained in subsection 11.1B, including, without limitation,

 

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the consent of Administrative Agent (if required) and the receipt by
Administrative Agent of an executed Assignment Agreement and other supporting
documents, have been fulfilled.

 

2.10                        Limitation on Interest.

 

Each Lender, Borrower and any other parties to the Loan Documents intend to
contract in strict compliance with applicable usury law from time to time in
effect.  In furtherance thereof, such Persons stipulate and agree that none of
the terms and provisions contained in the Loan Documents shall ever be construed
to create a contract to pay, for the use, forbearance or detention of money,
interest in excess of the maximum amount of interest permitted to be charged by
applicable law from time to time in effect.  Neither Borrower nor any present or
future guarantors, endorsers or other Persons hereafter becoming liable for
payment of any Obligation shall ever be liable for unearned interest thereon or
shall ever be required to pay interest thereon in excess of the maximum amount
that may be lawfully contracted for, charged, or received under applicable law
from time to time in effect, and the provisions of this section shall control
over all other provisions of the Loan Documents which may be in conflict or
apparent conflict herewith.  Each Lender expressly disavows any intention to
contract for, charge, or collect excessive unearned interest or finance charges
in the event the maturity of any Obligation is accelerated.  If (a) the maturity
of any Obligation is accelerated for any reason, (b) any Obligation is prepaid
and as a result any amounts held to constitute interest are determined to be in
excess of the legal maximum, or (c) any Lender or any other holder of any or all
of the Obligations shall otherwise collect moneys which are determined to
constitute interest which would otherwise increase the interest on any or all of
the Obligations to an amount in excess of that permitted to be charged by
applicable law then in effect (the “Maximum Rate”), then all sums determined to
constitute interest in excess of such legal limits shall, without penalty, be
promptly applied to reduce the then outstanding principal of the related
Obligations or, at each Lender’s or holder’s option promptly returned to
Borrower or the other payor thereof upon such determination.  In determining
whether or not the interest paid or payable, under any specific circumstance,
exceeds the maximum amount permitted under applicable law, each Lender and
Borrower (and any other payors thereof) shall, to the greatest extent permitted
under applicable law, (i) characterize any non-principal payment as an expense,
fee or premium rather than as interest, (ii) exclude voluntary prepayments and
the effects thereof, and (iii) amortize, prorate, allocate, and spread the total
amount of interest throughout the entire contemplated term of the instruments
evidencing the Obligations in accordance with the amounts outstanding from time
to time thereunder and the maximum legal rate of interest from time to time in
effect under applicable law in order to lawfully contract for, charge, or
receive the maximum amount of interest permitted under applicable law. 
Notwithstanding the foregoing, if for any period of time interest on any
Obligations is calculated at the Maximum Rate rather than the applicable rate
under this Agreement, and thereafter such applicable rate becomes less than the
Maximum Rate, the rate of interest payable on such Obligations shall remain at
the Maximum Rate until each Lender shall have received the amount of interest
which such Lender would have received during such period on such Obligations had
the rate of interest not been limited to the Maximum Rate during such period.

 

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Section 3.              LETTERS OF CREDIT

 

3.1                               Issuance of Letters of Credit and Lenders’
Purchase of Participations Therein.

 

A.            Letters of Credit.  In addition to Borrower requesting that
Lenders make Revolving Loans pursuant to subsection 2.1A(i), Borrower may
request, in accordance with the provisions of this subsection 3.1, from time to
time during the period from the Closing Date to but excluding the Revolving Loan
Commitment Termination Date, that one or more Lenders issue Letters of Credit
for the account of Borrower for the purposes specified in the definition of
Letters of Credit.  Subject to the terms and conditions of this Agreement and in
reliance upon the representations and warranties of Borrower herein set forth,
any one or more Lenders may, but (except as provided in subsection 3.1B(ii))
shall not be obligated to, issue such Letters of Credit in accordance with the
provisions of this subsection 3.1; provided that Borrower shall not request that
any Lender issue (and no Lender shall issue):

 

(i)            any Letter of Credit if, after giving effect to such issuance,
the Total Utilization of Revolving Loan Commitments would exceed the Revolving
Loan Commitments of all Lenders;

 

(ii)           any Letter of Credit if, after giving effect to such issuance,
the Letter of Credit Usage would exceed $50,000,000;

 

(iii)          any Letter of Credit having an expiration date later than the
earlier of (a) ten days prior to the Revolving Loan Commitment Termination Date,
and (b) the date which is one year from the date of issuance of such Letter of
Credit; provided that the immediately preceding clause (b) shall not prevent any
Issuing Lender from agreeing that a Letter of Credit will automatically be
extended for one or more successive periods not to exceed one year each unless
such Issuing Lender elects not to extend for any such additional period; and
provided further that such Issuing Lender shall elect not to extend such Letter
of Credit if it has knowledge that an Event of Default has occurred and is
continuing (and has not been waived in accordance with subsection 11.6) at the
time such Issuing Lender must elect whether or not to allow such extension;

 

(iv)          any Letter of Credit denominated in a currency other than Dollars;
or

 

(v)           any Letter of Credit that is otherwise unacceptable to the
applicable Issuing Lender in its reasonable discretion.

 

B.            Mechanics of Issuance.

 

(i)            Notice of Issuance.  Whenever Borrower desires the issuance of a
Letter of Credit, it shall deliver to Administrative Agent a Notice of Issuance
of Letter of Credit substantially in the form of Exhibit III annexed hereto no
later than 1:00 P.M. (New York City time) at least three Business Days, or in
each case such shorter period as may be agreed to by the Issuing Lender in any
particular instance, in advance of the proposed date of issuance.  The Notice of
Issuance of Letter of Credit shall specify (a) the proposed date of issuance
(which shall be a Business Day), (b) the face amount

 

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of the Letter of Credit, (c) the expiration date of the Letter of Credit,
(d) the name and address of the beneficiary, and (e) either the verbatim text of
the proposed Letter of Credit or the proposed terms and conditions thereof,
including a precise description of any documents to be presented by the
beneficiary which, if presented by the beneficiary prior to the expiration date
of the Letter of Credit, would require the Issuing Lender to make payment under
the Letter of Credit; provided that the Issuing Lender, in its reasonable
discretion, may require changes in the text of the proposed Letter of Credit or
any such documents; and provided, further that no Letter of Credit shall require
payment against a conforming draft to be made thereunder on the same Business
Day (under the laws of the jurisdiction in which the office of the Issuing
Lender to which such draft is required to be presented is located) that such
draft is presented if such presentation is made after 12:00 Noon (in the time
zone of such office of the Issuing Lender) on such Business Day.

 

Borrower shall notify the applicable Issuing Lender (and Administrative Agent,
if Administrative Agent is not such Issuing Lender) prior to the issuance of any
Letter of Credit in the event that any of the matters to which Borrower is
required to certify in the applicable Notice of Issuance of Letter of Credit is
no longer true and correct as of the proposed date of issuance of such Letter of
Credit, and upon the issuance of any Letter of Credit Borrower shall be deemed
to have re-certified, as of the date of such issuance, as to the matters to
which Borrower is required to certify in the applicable Notice of Issuance of
Letter of Credit.

 

(ii)           Determination of Issuing Lender.  Upon receipt by Administrative
Agent of a Notice of Issuance of Letter of Credit pursuant to subsection 3.1B(i)
requesting the issuance of a Letter of Credit, in the event Administrative Agent
elects to issue such Letter of Credit, Administrative Agent shall promptly so
notify Borrower, and Administrative Agent shall be the Issuing Lender with
respect thereto.  In the event that Administrative Agent, in its sole
discretion, elects not to issue such Letter of Credit, Administrative Agent
shall promptly so notify Borrower, whereupon Borrower may request any other
Lender to issue such Letter of Credit by delivering to such Lender a copy of the
applicable Notice of Issuance of Letter of Credit.  Any Lender so requested to
issue such Letter of Credit shall promptly notify Borrower and Administrative
Agent whether or not, in its sole discretion, it has elected to issue such
Letter of Credit, and any such Lender which so elects to issue such Letter of
Credit shall be the Issuing Lender with respect thereto.  If all other Lenders
have declined to issue such Letter of Credit, notwithstanding the prior election
of Administrative Agent not to issue such Letter of Credit, Administrative Agent
shall issue such Letter of Credit and shall be the Issuing Lender with respect
thereto, notwithstanding the fact that the Letter of Credit Usage with respect
to such Letter of Credit and with respect to all other Letters of Credit issued
by Administrative Agent when aggregated with Administrative Agent’s outstanding
Revolving Loans may exceed Administrative Agent’s Revolving Loan Commitment then
in effect.

 

(iii)          Issuance of Letter of Credit.  Upon satisfaction or waiver (in
accordance with subsection 11.6) of the conditions set forth in subsection 4.3,
the Issuing Lender

 

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shall issue the requested Letter of Credit in accordance with the Issuing
Lender’s standard operating procedures.

 

(iv)          Notification to Lenders.  Upon the issuance of any Letter of
Credit the applicable Issuing Lender shall promptly notify Administrative Agent
and each other Lender of such issuance.  Promptly after receipt of such notice
(or, if Administrative Agent is the Issuing Lender, together with such notice),
Administrative Agent shall notify each Lender of the amount of such Lender’s
respective participation in such Letter of Credit, determined in accordance with
subsection 3.1C.

 

C.            Lenders’ Purchase of Participations in Letters of Credit. 
Immediately upon the issuance of each Letter of Credit, each Lender with a
Revolving Loan Commitment shall be deemed to, and hereby agrees to, have
irrevocably purchased from the Issuing Lender a participation in such Letter of
Credit and any drawings honored thereunder in an amount equal to such Lender’s
Pro Rata Share of the maximum amount which is or at any time may become
available to be drawn thereunder.

 

3.2                               Letter of Credit Fees.

 

Borrower agrees to pay the following amounts with respect to Letters of Credit
issued hereunder:

 

(i)            with respect to each Letter of Credit, (a) a fronting fee,
payable directly to the applicable Issuing Lender for its own account, equal to
0.25% per annum of the daily amount available to be drawn under such Letter of
Credit, and (b) a letter of credit fee, payable to Administrative Agent for the
account of those Lenders with a Revolving Loan Commitment, equal to the
Applicable LIBOR Margin multiplied by the daily amount available to be drawn
under such Letter of Credit (without duplication of any amounts required to be
paid under subsection 3.3D(i)), each such fronting fee or letter of credit fee
to be payable in arrears on the last Business Day of each March, June, September
and December of each Fiscal Year commencing on the first such date to occur
after the Effective Date, and on the Revolving Loan Commitment Termination Date,
and computed on the basis of a 360-day year for the actual number of days
elapsed; and

 

(ii)           with respect to the issuance, amendment or transfer of each
Letter of Credit and each payment of a drawing made thereunder (without
duplication of the fees payable under clauses (i) and (ii) above), documentary
and processing charges payable directly to the applicable Issuing Lender for its
own account in accordance with such Issuing Lender’s standard schedule for such
charges in effect at the time of such issuance, amendment, transfer or payment,
as the case may be.

 

For purposes of calculating any fees payable under clauses (i) and (ii) of this
subsection 3.2, the daily amount available to be drawn under any Letter of
Credit shall be determined as of the close of business on any date of
determination.  Promptly upon receipt by Administrative Agent of any amount
described in clause (i) or (ii) of this subsection 3.2, Administrative

 

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Agent shall distribute to each Lender with a Revolving Loan Commitment its Pro
Rata Share of such amount.

 

3.3                               Drawings and Reimbursement of Amounts Paid
Under Letters of Credit.

 

A.            Responsibility of Issuing Lender With Respect to Drawings.  In
determining whether to honor any drawing under any Letter of Credit by the
beneficiary thereof, the Issuing Lender shall be responsible only to examine the
documents delivered under such Letter of Credit with reasonable care so as to
ascertain whether they appear on their face to be in accordance with the terms
and conditions of such Letter of Credit.

 

B.            Reimbursement by Borrower of Amounts Paid Under Letters of
Credit.  In the event an Issuing Lender has determined to honor a drawing under
a Letter of Credit issued by it, such Issuing Lender shall immediately notify
Borrower and Administrative Agent, and Borrower shall reimburse such Issuing
Lender on or before the Business Day immediately following the date on which
such drawing is honored (the “Reimbursement Date”) in an amount in Dollars and
in same day funds equal to the amount of such honored drawing; provided that,
anything contained in this Agreement to the contrary notwithstanding, (i) unless
Borrower shall have notified Administrative Agent and such Issuing Lender prior
to 1:00 P.M. (New York City time) on the date such drawing is honored that
Borrower intends to reimburse such Issuing Lender for the amount of such honored
drawing with funds other than the proceeds of Revolving Loans, Borrower shall be
deemed to have given a timely Notice of Borrowing to Administrative Agent
requesting Lenders to make Revolving Loans that are Base Rate Loans on the
Reimbursement Date in an amount in Dollars equal to the amount of such honored
drawing and (ii) Lenders shall, on the Reimbursement Date, make Revolving Loans
that are Base Rate Loans in the amount of such honored drawing (it being
understood that such funding of Revolving Loans by Lenders is not a failure by
Borrower to make payments when due under subsection 8.1), the proceeds of which
shall be applied directly by Administrative Agent to reimburse such Issuing
Lender for the amount of such honored drawing; and provided, further that if for
any reason proceeds of Revolving Loans are not received by such Issuing Lender
on the Reimbursement Date in an amount equal to the amount of such honored
drawing, Borrower shall reimburse such Issuing Lender, on demand, in an amount
in same day funds equal to the excess of the amount of such honored drawing over
the aggregate amount of such Revolving Loans, if any, which are so received. 
Nothing in this subsection 3.3B shall be deemed to relieve any Lender from its
obligation to make Revolving Loans on the terms and conditions set forth in this
Agreement, and Borrower shall retain any and all rights it may have against any
Lender resulting from the failure of such Lender to make such Revolving Loans
under this subsection 3.3B.

 

C.            Payment by Lenders of Unreimbursed Amounts Paid Under Letters of
Credit.

 

(i)            Payment by Lenders.  In the event that Borrower shall fail for
any reason to reimburse any Issuing Lender as provided in subsection 3.3B in an
amount equal to the amount of any drawing honored by such Issuing Lender under a
Letter of Credit issued by it, such Issuing Lender shall promptly notify each
other Lender with a Revolving Loan Commitment of the unreimbursed amount of such
honored drawing

 

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and of such other Lender’s respective participation therein based on such
Lender’s Pro Rata Share of the Revolving Loan Commitment.  Each Lender with a
Revolving Loan Commitment shall make available to such Issuing Lender an amount
equal to its respective participation, in Dollars and in same day funds, at the
office of such Issuing Lender specified in such notice, not later than 12:00
Noon (New York City time) on the first Business Day (under the laws of the
jurisdiction in which such office of such Issuing Lender is located) after the
date notified by such Issuing Lender.  In the event that any Lender with a
Revolving Loan Commitment fails to make available to such Issuing Lender on such
Business Day the amount of such Lender’s participation in such Letter of Credit
as provided in this subsection 3.3C, such Issuing Lender shall be entitled to
recover such amount on demand from such Lender together with interest thereon at
the rate customarily used by such Issuing Lender for the correction of errors
among banks for three Business Days and thereafter at the Base Rate.  Nothing in
this subsection 3.3C shall be deemed to prejudice the right of any Lender to
recover from any Issuing Lender any amounts made available by such Lender to
such Issuing Lender pursuant to this subsection 3.3C in the event that it is
determined by the final judgment of a court of competent jurisdiction that the
payment with respect to a Letter of Credit by such Issuing Lender in respect of
which payment was made by such Lender constituted gross negligence or willful
misconduct on the part of such Issuing Lender.

 

(ii)           Distribution to Lenders of Reimbursements Received From
Borrower.  In the event any Issuing Lender shall have been reimbursed by other
Lenders pursuant to subsection 3.3C(i) for all or any portion of any drawing
honored by such Issuing Lender under a Letter of Credit issued by it, such
Issuing Lender shall distribute to each other Lender with a Revolving Loan
Commitment which has paid all amounts payable by it under subsection 3.3C(i)
with respect to such honored drawing such other Lender’s Pro Rata Share of the
Revolving Loan Commitment of all payments subsequently received by such Issuing
Lender from Borrower in reimbursement of such honored drawing when such payments
are received.  Any such distribution shall be made to a Lender at its primary
address set forth below its name on the appropriate signature page hereof or at
such other address as such Lender may request.

 

D.            Interest on Amounts Paid Under Letters of Credit.

 

(i)            Payment of Interest by Borrower.  Borrower agrees to pay to each
Issuing Lender, with respect to drawings honored under any Letters of Credit
issued by it, interest on the amount paid by such Issuing Lender in respect of
each such honored drawing from the date such drawing is honored to but excluding
the date such amount is reimbursed by Borrower (without duplication of any
amounts required to be paid under subsection 3.2(i)) (including any such
reimbursement out of the proceeds of Revolving Loans pursuant to subsection
3.3B) at a rate equal to (a) for the period from the date such drawing is
honored to but excluding the Reimbursement Date, the rate then in effect under
this Agreement with respect to Revolving Loans that are Base Rate Loans and (b)
thereafter, a rate which is 2.00% per annum in excess of the rate of interest
otherwise payable under this Agreement with respect to Revolving Loans that are
Base Rate Loans, but in no event in excess of the maximum nonusurious interest

 

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rate permitted by applicable law.  Interest payable pursuant to this subsection
3.3D(i) shall be computed on the basis of a 365-day or 366-day year, as the case
may be, for the actual number of days elapsed in the period during which it
accrues and shall be payable on demand or, if no demand is made, on the date on
which the related drawing under a Letter of Credit is reimbursed in full.

 

(ii)           Distribution of Interest Payments by Issuing Lender.  Promptly
upon receipt by any Issuing Lender of any payment of interest pursuant to
subsection 3.3D(i) with respect to a drawing honored under a Letter of Credit
issued by it, (a) such Issuing Lender shall distribute to each other Lender with
a Revolving Loan Commitment, out of the interest received by such Issuing Lender
in respect of the period from the date such drawing is honored to but excluding
the date on which such Issuing Lender is reimbursed for the amount of such
drawing (including any such reimbursement out of the proceeds of Revolving Loans
pursuant to subsection 3.3B), the amount that such other Lender would have been
entitled to receive in respect of the letter of credit fee that would have been
payable in respect of such Letter of Credit for such period pursuant to
subsection 3.2 if no drawing had been honored under such Letter of Credit, and
(b) in the event such Issuing Lender shall have been reimbursed by other Lenders
pursuant to subsection 3.3C(i) for all or any portion of such honored drawing,
such Issuing Lender shall distribute to each other Lender with a Revolving Loan
Commitment which has paid all amounts payable by it under subsection 3.3C(i)
with respect to such honored drawing such other Lender’s Pro Rata Share of the
Revolving Loan Commitment of any interest received by such Issuing Lender in
respect of that portion of such honored drawing so reimbursed by other Lenders
for the period from the date on which such Issuing Lender was so reimbursed by
other Lenders to but excluding the date on which such portion of such honored
drawing is reimbursed by Borrower.  Any such distribution shall be made to a
Lender at its primary address set forth below its name on the appropriate
signature page hereof or at such other address as such Lender may request.

 

3.4                               Obligations Absolute.

 

The obligation of Borrower to reimburse each Issuing Lender for drawings honored
under the Letters of Credit issued by it and to repay any Revolving Loans made
by Lenders pursuant to subsection 3.3B and the obligations of Lenders under
subsection 3.3C(i) shall be unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances
including any of the following circumstances:

 

(i)            any lack of validity or enforceability of any Letter of Credit;

 

(ii)           the existence of any claim, set-off, defense or other right which
Borrower or any Lender may have at any time against a beneficiary or any
transferee of any Letter of Credit (or any Persons for whom any such transferee
may be acting), any Issuing Lender or other Lender or any other Person or, in
the case of a Lender, against Borrower, whether in connection with this
Agreement, the transactions contemplated herein or any unrelated transaction
(including any underlying transaction

 

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between Borrower, Holdings or one of their Subsidiaries and the beneficiary for
which any Letter of Credit was procured);

 

(iii)          any draft or 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;

 

(iv)          payment by the applicable Issuing Lender under any Letter of
Credit against presentation of a draft or other document which does not
substantially comply with the terms of such Letter of Credit;

 

(v)           any adverse change in the business, operations, properties,
assets, condition (financial or otherwise) or prospects of Borrower, Holdings or
any of their Subsidiaries;

 

(vi)          any breach of this Agreement or any other Loan Document by any
party thereto;

 

(vii)         any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing; or

 

(viii)        the fact that an Event of Default or a Potential Event of Default
shall have occurred and be continuing;

 

provided, in each case, that payment by the applicable Issuing Lender under the
applicable Letter of Credit shall not have constituted gross negligence or
willful misconduct of such Issuing Lender under the circumstances in question
(as determined by a final judgment of a court of competent jurisdiction).

 

3.5                               Indemnification; Nature of Issuing Lenders’
Duties.

 

A.            Indemnification.  In addition to amounts payable as provided in
subsection 3.6 and in accordance with the indemnification provided for in
subsection 11.3, Borrower hereby agrees to protect, indemnify, pay and save
harmless each Issuing Lender from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel) which such Issuing Lender may incur
or be subject to as a consequence, direct or indirect, of (i) the issuance of
any Letter of Credit by such Issuing Lender, other than as a result of (a) the
gross negligence or willful misconduct of such Issuing Lender as determined by a
final judgment of a court of competent jurisdiction or (b) subject to the
following clause (ii), the wrongful dishonor by such Issuing Lender of a proper
demand for payment made under any Letter of Credit issued by it or (ii) the
failure of such Issuing Lender to honor a drawing under any such Letter of
Credit as a result of any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto government or governmental authority (all
such acts or omissions herein called “Governmental Acts”).

 

B.            Nature of Issuing Lenders’ Duties.  As between Borrower and any
Issuing Lender, Borrower assumes all risks of the acts and omissions of, or
misuse of the Letters of

 

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Credit issued by such Issuing Lender by, the respective beneficiaries of such
Letters of Credit.  In furtherance and not in limitation of the foregoing, such
Issuing Lender shall not be responsible for:  (i) the form, validity,
sufficiency, accuracy, genuineness or legal effect of any document submitted by
any party in connection with the application for and issuance of any such Letter
of Credit, even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or assign
any such Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or ineffective for
any reason; (iii) failure of the beneficiary of any such Letter of Credit to
comply fully with any conditions required in order to draw upon such Letter of
Credit; (iv) errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether
or not they be in cipher; (v) errors in interpretation of technical terms; (vi)
any loss or delay in the transmission or otherwise of any document required in
order to make a drawing under any such Letter of Credit or of the proceeds
thereof; (vii) the misapplication by the beneficiary of any such Letter of
Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any
consequences arising from causes beyond the control of such Issuing Lender,
including any Governmental Acts, and none of the above shall affect or impair,
or prevent the vesting of, any of such Issuing Lender’s rights or powers
hereunder.

 

In furtherance and extension and not in limitation of the specific provisions
set forth in the first paragraph of this subsection 3.5B, any action taken or
omitted by any Issuing Lender under or in connection with the Letters of Credit
issued by it or any documents and certificates delivered thereunder, if taken or
omitted in good faith, shall not put such Issuing Lender under any resulting
liability to Borrower.

 

Notwithstanding anything to the contrary contained in this subsection 3.5,
Borrower shall retain any and all rights it may have against any Issuing Lender
for any liability arising solely out of the gross negligence or willful
misconduct of such Issuing Lender, as determined by a final judgment of a court
of competent jurisdiction.

 

3.6                               Increased Costs and Taxes Relating to Letters
of Credit.

 

Subject to the provisions of subsection 2.7B (which shall be controlling with
respect to the matters covered thereby), in the event that any Issuing Lender or
Lender shall determine (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto) that any law, treaty
or governmental rule, regulation or order, or any change therein or in the
interpretation, administration or application thereof (including the
implementation of any new law, treaty or governmental rule, regulation or
order), or any determination of a court or governmental authority, in each case
that becomes effective after the date hereof, or compliance by any Issuing
Lender or Lender with any guideline, request or directive issued or made after
the date hereof by any central bank or other governmental or quasi-governmental
authority (whether or not having the force of law):

 

(i)            subjects such Issuing Lender or Lender (or its applicable lending
or letter of credit office) to any additional Tax (other than any Tax on the
overall net income of such Issuing Lender or Lender) with respect to the issuing
or maintaining of

 

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any Letters of Credit or the purchasing or maintaining of any participations
therein or any other obligations under this Section 3, whether directly or by
such being imposed on or suffered by any particular Issuing Lender;

 

(ii)           imposes, modifies or holds applicable any reserve (including any
marginal, emergency, supplemental, special or other reserve), special deposit,
compulsory loan, FDIC insurance or similar requirement in respect of any Letters
of Credit issued by any Issuing Lender or participations therein purchased by
any Lender; or

 

(iii)          imposes any other condition (other than with respect to a Tax
matter) on or affecting such Issuing Lender or Lender (or its applicable lending
or letter of credit office) regarding this Section 3 or any Letter of Credit or
any participation therein;

 

and the result of any of the foregoing is to increase the cost to such Issuing
Lender or Lender of agreeing to issue, issuing or maintaining any Letter of
Credit or agreeing to purchase, purchasing or maintaining any participation
therein or to reduce any amount received or receivable by such Issuing Lender or
Lender (or its applicable lending or letter of credit office) with respect
thereto; then, in any case, Borrower shall promptly pay to such Issuing Lender
or Lender, upon receipt of the statement referred to in the next sentence, such
additional amount or amounts as may be necessary to compensate such Issuing
Lender or Lender for any such increased cost or reduction in amounts received or
receivable hereunder.  Such Issuing Lender or Lender shall deliver to Borrower a
written statement within six months after the occurrence of the circumstances
giving rise to such additional amounts, setting forth in reasonable detail the
basis for calculating the additional amounts owed to such Issuing Lender or
Lender under this subsection 3.6, which statement shall be conclusive and
binding upon all parties hereto absent manifest error.

 

Section 4.              CONDITIONS TO LOANS AND LETTERS OF CREDIT

 

The obligations of Lenders to make Loans and the issuance of Letters of Credit
hereunder are subject to the satisfaction of the following conditions.

 

4.1                               Conditions to Effective Date.

 

The effectiveness of this Agreement is subject to prior or concurrent
satisfaction of the following conditions:

 

A.            Loan Party Documents.  On or before the Effective Date, Borrower
shall, and shall cause Holdings and each wholly-owned Subsidiary of Holdings to,
deliver to Lenders (or to Administrative Agent for Lenders with sufficient
originally executed copies, where appropriate, for each Lender and its counsel)
the following with respect to Borrower or such Loan Party, as the case may be,
each, unless otherwise noted, dated the Effective Date:

 

(i)            Certified copies of the Certificate or Articles of Incorporation
or similar formation documents of such Person, together with a good standing
certificate from the Secretary of State of its jurisdiction of incorporation and
each other state in which such Person is qualified as a foreign corporation to
do business and, to the extent generally

 

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available, a certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing authority of
each of such jurisdictions, each dated a recent date prior to the Effective
Date;

 

(ii)           Copies of the Bylaws or other similar organizational documents of
such Person, certified as of the Effective Date by such Person’s corporate
secretary or an assistant secretary;

 

(iii)          Resolutions of the Board of Directors or other similar governing
body of such Person approving and authorizing the execution, delivery and
performance of the Loan Documents to which it is a party, certified as of the
Effective Date by the corporate secretary or an assistant secretary of such
Person as being in full force and effect without modification or amendment;

 

(iv)          Signature and incumbency certificates of the officers of such
Person executing the Loan Documents to which it is a party;

 

(v)           Executed originals of the Loan Documents to which such Person is a
party; and

 

(vi)          Such other documents as Administrative Agent may reasonably
request.

 

B.            No Material Adverse Effect.  Since December 31, 2002, no event has
occurred which in the reasonable opinion of Administrative Agent and Syndication
Agent is likely to cause a Material Adverse Effect.

 

C.            Corporate and Capital Structure, Ownership.

 

(i)            Corporate Structure.  The corporate organizational structure of
Holdings and its Subsidiaries shall be as previously approved by Administrative
Agent and set forth on Schedule 4.1C annexed hereto or as otherwise reasonably
satisfactory to Administrative Agent.

 

(ii)           Capital Structure and Ownership.  The capital structure and
ownership of Borrower and Holdings shall be as previously approved by
Administrative Agent and set forth on Schedule 4.1C or as otherwise reasonably
satisfactory to Administrative Agent.

 

D.            Necessary Governmental Authorizations and Consents; Expiration of
Waiting Periods, Etc.  Borrower shall have obtained all Governmental
Authorizations and all consents of other Persons, in each case that are
necessary in connection with the transactions contemplated by the Loan
Documents, and the continued operation of the business conducted by Holdings and
its Subsidiaries in substantially the same manner as currently conducted, and
each of the foregoing shall be in full force and effect, in each case other than
those the failure to obtain or maintain which, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect. 
All applicable waiting periods shall have expired without any action being taken
or threatened by any competent authority which would restrain, prevent or
otherwise impose adverse conditions on the financing.  No action, request for
stay,

 

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petition for review or rehearing, reconsideration, or appeal with respect to any
of the foregoing shall be pending, and the time for any applicable agency to
take action to set aside its consent on its own motion shall have expired.

 

E.             Security Interests in Personal and Mixed Property.  To the extent
not otherwise satisfied prior to the Effective Date, Administrative Agent shall
have received evidence satisfactory to it that the Loan Parties shall have taken
or caused to be taken all such actions, executed and delivered or caused to be
executed and delivered all such agreements, documents and instruments, and made
or caused to be made all such filings and recordings (other than the filing or
recording of items described in clauses (iii) and (iv) below) that may be
necessary or, in the reasonable opinion of Administrative Agent, desirable in
order to create in favor of Administrative Agent, for the benefit of Lenders and
the holders of the Senior Notes required to be equally and ratably secured with
the Lenders, a valid and (upon such filing and recording) perfected First
Priority security interest in the Collateral.  Such actions shall include the
following:

 

(i)            Schedules to the Collateral Documents.  Delivery to
Administrative Agent of accurate and complete schedules to all of the applicable
Collateral Documents;

 

(ii)           Stock Certificates; Instruments; and Promissory Notes.  Delivery
to Administrative Agent of (a) certificates (which certificates shall be
accompanied by irrevocable undated stock powers, duly endorsed in blank and
otherwise satisfactory in form and substance to Administrative Agent)
representing all capital stock pledged pursuant to the Pledge Agreement, (b) all
promissory notes or other instruments (duly endorsed, where appropriate, in a
manner satisfactory to Administrative Agent) evidencing any Collateral; and
(c) all notes, endorsements in blank and other documentation required to pledge
the Mortgage Loans (as such term is defined in the Pledge Agreement) pursuant to
the Pledge Agreement;

 

(iii)          Lien Searches and UCC Termination Statements.  Delivery to
Administrative Agent of (a) the results of a recent search, by a Person
reasonably satisfactory to Administrative Agent, of all effective UCC financing
statements which may have been made with respect to the jurisdiction of
formation or organization of any Loan Party and the headquarters of any Loan
Party, together with copies of all such filings disclosed by such search, and
(b) UCC termination statements duly executed by all applicable Persons for
filing in all applicable jurisdictions as may be necessary to terminate any
effective UCC financing statements or fixture filings disclosed in such search
(other than any such financing statements or fixture filings in respect of Liens
permitted to remain outstanding pursuant to the terms of this Agreement); and

 

(iv)          UCC Financing Statements.  Delivery to Administrative Agent of UCC
financing statements, duly executed by each applicable Loan Party with respect
to all Collateral of such Loan Party, for filing in all jurisdictions as may be
necessary or, in the reasonable opinion of Administrative Agent, desirable to
perfect the security interests created in such Collateral pursuant to the
Collateral Documents.

 

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F.             Evidence of Insurance.  Administrative Agent shall have received
a certificate from Borrower’s insurance broker or other evidence reasonably
satisfactory to it that all insurance required to be maintained pursuant to
subsection 6.4 is in full force and effect.

 

G.            Opinions of Counsel to Loan Parties.  Lenders and their respective
counsel shall have received originally executed copies of a favorable written
opinion of Akin Gump Strauss Hauer & Feld LLP, counsel for Loan Parties, in form
and substance reasonably satisfactory to Administrative Agent and its counsel,
dated as of the Effective Date, and evidence satisfactory to Administrative
Agent that Borrower has requested such counsel to deliver such opinion to
Lenders.

 

H.            Interest and Fees under Existing Credit Agreement; Other Fees.

 

(i)            Borrower shall have paid to Administrative Agent for distribution
to Lenders, all accrued interest and fees payable under the Existing Credit
Agreement as of the Effective Date; and

 

(ii)           Borrower shall have paid to Administrative Agent, for
distribution (as appropriate) to Administrative Agent and Lenders, the fees
payable on the Effective Date referred to in subsection 2.3 and the reasonable
fees, costs and expenses of counsel to Administrative Agent.

 

I.              Representations and Warranties; Performance of Agreements. 
Borrower and Holdings shall have delivered to Administrative Agent an Officers’
Certificate, in form and substance satisfactory to Administrative Agent, to the
effect that the representations and warranties in Section 5 hereof are true,
correct and complete in all material respects on and as of the Effective Date to
the same extent as though made on and as of that date (or, to the extent such
representations and warranties specifically relate to an earlier date, that such
representations and warranties were true, correct and complete in all material
respects on and as of such earlier date) and that Borrower and Holdings shall
have performed in all material respects all agreements and satisfied all
conditions which this Agreement provides shall be performed or satisfied by them
on or before the Effective Date except as otherwise disclosed to and agreed to
in writing by Administrative Agent and Requisite Lenders.

 

J.             Completion of Proceedings.  All corporate and other proceedings
taken or to be taken in connection with the transactions contemplated hereby and
all documents incidental thereto not previously found acceptable by
Administrative Agent, acting on behalf of Lenders, and its counsel shall be
reasonably satisfactory in form and substance to Administrative Agent and such
counsel, and Administrative Agent and such counsel shall have received all such
counterpart originals or certified copies of such documents as Administrative
Agent may reasonably request.

 

K.            No Disruption of Financial Markets.  There shall have not occurred
any material adverse change in the financial markets after October 6, 2003, as
determined by Administrative Agent and Syndication Agent in their sole
discretion.

 

L.            Solvency Assurances.  On the Effective Date, Administrative Agent
and Lenders shall have received an Officers’ Certificate executed by the
treasurer or chief

 

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financial officer of Holdings, dated the Effective Date, substantially in the
form of Exhibit IX and with appropriate attachments, demonstrating that, after
giving effect to the consummation of the transactions contemplated by this
Agreement, Holdings and its Subsidiaries, taken as a whole, will be Solvent.

 

M.           Financial Covenants.  On or before the Effective Date,
Administrative Agent shall have received an Officers’ Certificate executed by
the chief financial officer of Holdings, dated as of the end of the last Fiscal
Quarter ending before the Effective Date, with appropriate attachments,
demonstrating that Borrower and Holdings are in compliance with (i) the
financial covenants set forth in subsection 7.6, and (ii) the restrictions in
the Senior Note Documents with respect to the amount of Indebtedness and secured
Indebtedness permitted to be outstanding by Borrower as of such date, with such
detail and supporting calculations therefor as reasonably required by
Administrative Agent.

 

4.2                               Conditions to All Loans.

 

The obligations of Lenders to make Loans on each Funding Date are subject to the
following conditions precedent:

 

A.            Administrative Agent shall have received before that Funding Date,
in accordance with the provisions of subsection 2.1B, an originally executed
Notice of Borrowing, in each case signed by the chief executive officer, the
chief financial officer or the treasurer of Borrower or any other person
designated in writing by any of the above described officers by or on behalf of
Borrower in a writing delivered to Administrative Agent.

 

B.            As of that Funding Date:

 

(i)            The representations and warranties contained herein and in the
other Loan Documents shall be true, correct and complete in all material
respects on and as of that Funding Date to the same extent as though made on and
as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case such representations and
warranties shall have been true, correct and complete in all material respects
on and as of such earlier date; provided, that where a representation and
warranty is already qualified as to materiality, such materiality qualifier
shall be disregarded for purposes of this provision;

 

(ii)           No event shall have occurred and be continuing or would result
from the consummation of the borrowing contemplated by such Notice of Borrowing
that would constitute an Event of Default or a Potential Event of Default;

 

(iii)          Each Loan Party shall have performed in all material respects all
agreements and satisfied all conditions which this Agreement provides shall be
performed or satisfied by it on or before that Funding Date;

 

(iv)          No order, judgment or decree of any court, arbitrator or
governmental authority shall purport to enjoin or restrain any Lender from
making the Loans to be made by it on that Funding Date;

 

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(v)           The making of the Loans requested on such Funding Date shall not
violate any law including Regulation T, Regulation U or Regulation X of the
Board of Governors of the Federal Reserve System; and

 

(vi)          There shall not be pending or, to the knowledge of Holdings or
Borrower, threatened, any action, suit, proceeding, governmental investigation
or arbitration against or affecting Holdings or any of its Subsidiaries or any
property of Holdings or any of its Subsidiaries that has not been disclosed by
Borrower in writing pursuant to subsection 5.6 or 6.1(vi) prior to the making of
the last preceding Loans (or, in the case of the initial Loans, prior to the
execution of this Agreement), and there shall have occurred no development not
so disclosed in any such action, suit, proceeding, governmental investigation or
arbitration so disclosed, that, in either event, in the opinion of
Administrative Agent or of Requisite Lenders, could reasonably be expected to
have a Material Adverse Effect; and no injunction or other restraining order
shall have been issued and no hearing to cause an injunction or other
restraining order to be issued shall be pending or noticed with respect to any
action, suit or proceeding seeking to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain relief as a result of, the
transactions contemplated by this Agreement or the making of Loans hereunder.

 

4.3                               Conditions to Letters of Credit.

 

The issuance of any Letter of Credit hereunder (whether or not the applicable
Issuing Lender is obligated to issue such Letter of Credit) is subject to the
following conditions precedent:

 

A.            On or before the date of issuance of the initial Letter of Credit
pursuant to this Agreement, the initial Loans shall have been made.

 

B.            On or before the date of issuance of such Letter of Credit,
Administrative Agent shall have received, in accordance with the provisions of
subsection 3.1B(i), a Notice of Issuance of Letter of Credit, in each case
signed by the chief executive officer, the chief financial officer or the
treasurer of Borrower or by any executive officer of Borrower designated by any
of the above-described officers on behalf of Borrower in a writing delivered to
Administrative Agent, together with all other information specified in
subsection 3.1B(i) and such other documents or information as the applicable
Issuing Lender may reasonably require in connection with the issuance of such
Letter of Credit.

 

On the date of issuance of such Letter of Credit, all conditions precedent
described in subsection 4.2B shall be satisfied to the same extent as if the
issuance of such Letter of Credit were the making of a Loan and the date of
issuance of such Letter of Credit were a Funding Date.

 

Section 5.                                          BORROWER’S AND HOLDINGS’
REPRESENTATIONS AND WARRANTIES

 

In order to induce Lenders to enter into this Agreement and to make the Loans,
to induce Issuing Lenders to issue Letters of Credit and to induce other Lenders
to purchase

 

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participations therein, Borrower and Holdings represent and warrant to each
Lender, on the date of this Agreement, on each Funding Date and on the date of
issuance of each Letter of Credit, that the following statements are true,
correct and complete:

 

5.1                               Organization, Powers, Qualification, Good
Standing, Business and Subsidiaries.

 

A.            Organization and Powers.  Each Loan Party is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
formation or organization as specified in Schedule 5.1 annexed hereto except
where the failure to be so organized, existing and in good standing could not
reasonably be expected to have a Material Adverse Effect.  Each Loan Party has
all requisite corporate, partnership or limited liability company power and
authority, as applicable, to own and operate its properties, to carry on its
business as now conducted and as proposed to be conducted, to enter into the
Loan Documents to which it is a party and to carry out the transactions
contemplated thereby except where the failure to have such power and authority
could not reasonably be expected to have a Material Adverse Effect.

 

B.            Qualification and Good Standing.  Each Loan Party is qualified to
do business and in good standing in every jurisdiction where its assets are
located and wherever necessary to carry out its business and operations, except
in jurisdictions where the failure to be so qualified or in good standing has
not had and could not reasonably be expected to have a Material Adverse Effect.

 

C.            Conduct of Business.  Holdings and its Subsidiaries are engaged
only in the businesses permitted to be engaged in pursuant to subsection 7.10.

 

D.            Subsidiaries.  All of the Subsidiaries of Holdings are identified
in Schedule 5.1 annexed hereto, as said Schedule 5.1 may be supplemented from
time to time pursuant to the provisions of subsection 6.1(x).  The capital stock
of each of the Subsidiaries of Holdings identified in Schedule 5.1 annexed
hereto (as so supplemented) is duly authorized, validly issued, fully paid and
nonassessable and none of such capital stock constitutes Margin Stock except
where any failure of the same could not be reasonably expected to have a
Material Adverse Effect.  Each of the Subsidiaries of Holdings identified in
Schedule 5.1 annexed hereto (as so supplemented) is a corporation, partnership
or limited liability company duly organized or formed, validly existing and in
good standing under the laws of its respective jurisdiction of incorporation set
forth therein, has all requisite corporate power, partnership or limited
liability company and authority to own and operate its properties and to carry
on its business as now conducted and as proposed to be conducted, and is
qualified to do business and in good standing in every jurisdiction where its
assets are located and wherever necessary to carry out its business and
operations; in each case except where failure to be so qualified or in good
standing or a lack of such corporate power, partnership or limited liability
company and authority has not had and could not reasonably be expected to have a
Material Adverse Effect.  Schedule 5.1 annexed hereto (as so supplemented)
correctly sets forth in all material respects the ownership interest of Holdings
and each of its Subsidiaries in each of the Subsidiaries of Holdings identified
therein.

 

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5.2                               Authorization of Borrowing, etc.

 

A.            Authorization of Borrowing.  The execution, delivery and
performance of the Loan Documents have been duly authorized by all necessary
corporate action on the part of each Loan Party that is a party thereto.

 

B.            No Conflict.  The execution, delivery and performance by Loan
Parties of the Loan Documents to which they are parties and the consummation of
the transactions contemplated by the Loan Documents do not and will not
(i) violate any provision of any law or any governmental rule or regulation
applicable to Holdings or any of its Subsidiaries, the Certificate or Articles
of Incorporation or Bylaws of Holdings or any of its Subsidiaries or any order,
judgment or decree of any court or other agency of government binding on
Holdings or any of its Subsidiaries, (ii) conflict with, result in a breach of
or constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of Holdings or any of its Subsidiaries, (iii) result in
or require the creation or imposition of any Lien upon any of the properties or
assets of Holdings or any of its Subsidiaries (other than any Liens created
under any of the Loan Documents in favor of Administrative Agent on behalf of
Lenders and the Senior Notes), or (iv) require any approval of stockholders or
any approval or consent of any Person under any Contractual Obligation of
Holdings or any of its Subsidiaries, except for such approvals or consents which
will be obtained on or before the Effective Date and disclosed in writing to
Lenders and except where the failure to obtain such approvals or consent,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.

 

C.            Governmental Consents.  The execution, delivery and performance by
Loan Parties of the Loan Documents to which they are parties and the
consummation of the transactions contemplated by the Loan Documents do not and
will not require any registration with, consent or approval of, or notice to, or
other action (“Filings”) to, with or by, any federal, state or other
governmental authority or regulatory body, except (1) Filings with the
Securities and Exchange Commission, (2) Filings with stock exchanges, (3)
Filings of the types described in subsections 5.16A and 5.16B, (4) routine
Filings in the ordinary course of business with respect to tax, ERISA,
environmental and Intellectual Property matters, and (5) Filings that,
individually or in the aggregate, if not made could not reasonably be expected
to have a Material Adverse Effect.

 

D.            Binding Obligation.  Each of the Loan Documents has been duly
executed and delivered by each Loan Party that is a party thereto and is the
legally valid and binding obligation of such Loan Party, enforceable against
such Loan Party in accordance with its respective terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting creditors’ rights generally or by equitable principles
relating to enforceability.

 

5.3                               Financial Condition.

 

Borrower has heretofore delivered, or caused to be delivered, to Lenders, at
Lenders’ request, the following financial statements and information:  (i) the
audited consolidated balance sheet of Holdings and its Subsidiaries as at
December 31, 2002 and the related

 

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consolidated statements of income, stockholders’ equity and cash flows of
Holdings and its Subsidiaries for the Fiscal Years then ended, and (ii) the
unaudited consolidated balance sheet of Holdings and its Subsidiaries as at
September 30, 2003 and the related unaudited consolidated statements of income
and cash flows of Holdings and its Subsidiaries for the nine months then ended. 
All such statements were prepared in conformity with GAAP and fairly present, in
all material respects, the financial position (on a consolidated basis) of the
entities described in such financial statements as at the respective dates
thereof and the results of operations and cash flows (on a consolidated basis)
of the entities described therein for each of the periods then ended, subject,
in the case of any such unaudited financial statements, to the absence of
footnotes and to changes resulting from audit and normal year-end adjustments. 
Borrower and Holdings do not (and will not following the funding of the initial
Loans) have any Contingent Obligation, contingent liability or liability for
taxes, long-term lease or unusual forward or long-term commitment that is not
reflected in the foregoing financial statements or the notes thereto or which
has not otherwise been disclosed to Administrative Agent and approved by
Administrative Agent, such approval not to be unreasonably withheld, and which
in any such case (but excluding, in all events, any and all such Contingent
Obligations and other liabilities between and among Borrower, Holdings and the
Subsidiary Guarantors) is material in relation to the business, operations,
properties, assets, financial condition or prospects of Holdings or any of its
Subsidiaries, taken as a whole.

 

5.4                               No Material Adverse Change.

 

Since December 31, 2002, no event or change has occurred that has caused or
evidences, either in any case or in the aggregate, a Material Adverse Effect.

 

5.5                               Title to Properties; Liens; Real Property.

 

A.            Title to Properties; Liens.  Holdings and its Subsidiaries have
(i) good, sufficient and legal title to (in the case of fee interests in real
property), (ii) valid leasehold interests in (in the case of leasehold interests
in real or personal property), or (iii) good title to (in the case of all other
personal property), all of their respective properties and assets reflected in
the financial statements referred to in subsection 5.3 or in the most recent
financial statements delivered pursuant to subsection 6.1, in each case except
for assets disposed of since the date of such financial statements in the
ordinary course of business or as otherwise permitted under subsections 7.2 and
7.7 except in cases, individually or in the aggregate, where any such title
defects could not reasonably be expected to have a Material Adverse Effect.

 

B.            Real Property.  As of the Effective Date, Schedule 5.5B annexed
hereto contains a true, accurate and complete list of all fee interests in any
Real Property Assets.  Except as specified in Schedule 5.5B annexed hereto, all
of the leases, subleases or assignments of leases affecting any such Real
Property Assets are in full force and effect and Borrower and Holdings do not
have knowledge of any default that has occurred and is continuing thereunder,
and each such agreement constitutes the legally valid and binding obligation of
each applicable Loan Party, enforceable against such Loan Party in accordance
with its terms, except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors’
rights generally or

 

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by equitable principles and except for such defaults as could not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

 

C.            Intellectual Property.  As of the Effective Date, Holdings and its
Subsidiaries own or have the right to use, all Intellectual Property used in the
conduct of their business, except where the failure to own or have such right to
use in the aggregate could not reasonably be expected to result in a Material
Adverse Effect.  Except as set forth in Schedule 5.6 annexed hereto, no claim
has been asserted and is pending by any Person challenging or questioning the
use of any such Intellectual Property or the validity or effectiveness of any
such Intellectual Property, nor does Holdings or Borrower know of any valid
basis for any such claim except for such claims that in the aggregate could not
reasonably be expected to result in a Material Adverse Effect.  The use of such
Intellectual Property by Holdings and its Subsidiaries does not infringe on the
rights of any Person, except for such claims and infringements that, in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

 

5.6                               Litigation; Adverse Facts.

 

Except as set forth in Schedule 5.6 annexed hereto, there are no actions, suits,
proceedings, arbitrations or governmental investigations (whether or not
purportedly on behalf of Holdings or any of its Subsidiaries) at law or in
equity, or before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign (including any Environmental Claims) that are pending or, to the
knowledge of Holdings or Borrower, threatened against or affecting Holdings or
any of its Subsidiaries or any property of Holdings or any of its Subsidiaries
and that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect.  Neither Holdings nor any of its
Subsidiaries (i) is in violation of any applicable laws (including Environmental
Laws) that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect, or (ii) is subject to or in default with
respect to any final judgments, writs, injunctions, decrees, rules or
regulations of any court or any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect.

 

5.7                               Payment of Taxes.

 

Except to the extent permitted by subsection 6.3, all tax returns and reports of
Holdings and its Subsidiaries required to be filed by any of them have been
timely filed, and all taxes shown on such tax returns to be due and payable and
all assessments, fees and other governmental charges upon Holdings and its
Subsidiaries and upon their respective properties, assets, income, businesses
and franchises which are due and payable have been paid when due and payable
except where, individually or in the aggregate, the failure to so file and/or
pay could not reasonably be expected to have a Material Adverse Effect. 
Borrower and Holdings know of no proposed material tax assessment against
Holdings or any of its Subsidiaries, the imposition of which could reasonably be
expected to have a Material Adverse Effect, that is not being actively contested
by Holdings, Borrower or such Subsidiary in good faith and by

 

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appropriate proceedings; provided that such reserves or other appropriate
provisions, if any, as shall be required in conformity with GAAP shall have been
made or provided therefor.

 

5.8                               Performance of Agreements; Materially Adverse
Agreements; Material Contracts.

 

A.            Neither Holdings nor any of its Subsidiaries is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any of its Contractual Obligations, and no condition
exists that, with the giving of notice or the lapse of time or both, would
constitute such a default, except where the consequences, direct or indirect, of
such default or defaults, if any, would not have a Material Adverse Effect.

 

B.            Neither Holdings nor any of its Subsidiaries is a party to or is
otherwise subject to any agreements or instruments or any charter or other
internal restrictions which, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.

 

C.            Except as set forth on Schedule 5.8C, all Material Contracts are
in full force and effect and no defaults currently exist thereunder, except for
defaults which, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.

 

5.9                               Governmental Regulation.

 

Neither Holdings nor any of its Subsidiaries is subject to regulation under the
Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act or the Investment Company Act of 1940 or under any other
federal or state statute or regulation which may limit its ability to incur
Indebtedness or which may otherwise render all or any portion of the Obligations
unenforceable.

 

5.10                        Securities Activities.

 

Neither Holdings nor any of its Subsidiaries is engaged principally, or as one
of their important activities, in the business of extending credit for the
purpose of purchasing or carrying any Margin Stock.  No part of the proceeds of
any Loan will be used to purchase or carry any Margin Stock or to extend credit
to others for the purpose of purchasing or carrying any Margin Stock.  Neither
the making of any Loan nor the use of the proceeds thereof will violate or be
inconsistent with the provisions of Regulations T, U or X of the Federal Reserve
Board.

 

5.11                        Employee Benefit Plans.

 

A.            Holdings, each of its Subsidiaries and each of their respective
ERISA Affiliates are in compliance in all material respects with all applicable
provisions and requirements of ERISA and the regulations and published
interpretations thereunder with respect to each Employee Benefit Plan (if any),
and have performed all their obligations under each Employee Benefit Plan in all
material respects.  Any proposed termination of an Employee Benefit Plan shall
be conducted in accordance with all applicable ERISA requirements.  Each
Employee

 

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Benefit Plan (if any) that is intended to qualify under Section 401(a) of the
Internal Revenue Code is so qualified;

 

B.            No ERISA Event has occurred or is reasonably expected to occur;

 

C.            Except to the extent required under Section 4980B of the Internal
Revenue Code or except as set forth in Schedule 5.11 annexed hereto, no Employee
Benefit Plan (if any) provides health or welfare benefits (through the purchase
of insurance or otherwise) for any retired or former employee of Holdings, any
of its Subsidiaries or any of their respective ERISA Affiliates;

 

D.            As of the most recent valuation date for any Pension Plan, the
amount of unfunded benefit liabilities (as defined in Section 4001(a)(18) of
ERISA), individually or in the aggregate for all Pension Plans (excluding for
purposes of such computation any Pension Plans with respect to which assets
exceed benefit liabilities) does not exceed $7,000,000; and

 

E.             As of the most recent valuation date for each Multiemployer Plan
(if any) for which the actuarial report is available, Holdings and its
Subsidiaries and their respective ERISA Affiliates have no potential liability
for a complete withdrawal from such Multiemployer Plans (within the meaning of
Section 4203 of ERISA).

 

5.12                        No Broker’s Fees.

 

No broker’s or finder’s fee or commission will be payable with respect to this
Agreement or any of the transactions contemplated hereby arising out of any
agreement entered into by Holdings or any of its Subsidiaries, and Borrower
hereby indemnifies Lenders against, and agrees that it will hold Lenders
harmless from, any claim, demand or liability for any such broker’s or finder’s
fees alleged to have been incurred in connection herewith or therewith and any
expenses (including reasonable fees, expenses and disbursements of counsel)
arising in connection with any such claim, demand or liability to the extent
arising out of any agreement entered into by Holdings or any of its
Subsidiaries.

 

5.13                        Environmental Protection.

 

Except as set forth in Schedule 5.13 annexed hereto:

 

(i)            Neither Holdings nor any of its Subsidiaries nor any of their
respective Real Property Assets or operations is subject to any outstanding
written order, consent decree or settlement agreement with any Person relating
to (a) any Environmental Law, (b) any Environmental Claim, or (c) any Hazardous
Materials Activity that, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect;

 

(ii)           Neither Holdings nor any of its Subsidiaries has received any
letter or request for information under Section 104 of the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9604) or
any comparable state law that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect;

 

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(iii)          there are and, to Holdings’ and Borrower’s knowledge, have been
no conditions, occurrences, or Hazardous Materials Activities which could
reasonably be expected to form the basis of an Environmental Claim against
Holdings or any of its Subsidiaries that, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect; and

 

(iv)          compliance with all current or reasonably foreseeable future
requirements pursuant to or under Environmental Laws could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

Notwithstanding anything in this subsection 5.13 to the contrary, no event or
condition has occurred or is occurring with respect to Holdings or any of its
Subsidiaries relating to any Environmental Law, any Release of Hazardous
Materials, or any Hazardous Materials Activity, including any matter disclosed
on Schedule 5.13 annexed hereto, which individually or in the aggregate, has had
or could reasonably be expected to have a Material Adverse Effect.

 

5.14                        Employee Matters.

 

There is no strike or work stoppage in existence or threatened involving
Holdings or any of its Subsidiaries that could reasonably be expected to have a
Material Adverse Effect, and there are no strikes or walkouts in progress,
pending or to Holdings’ or Borrower’s knowledge contemplated relating to any
labor contracts to which Holdings or any of its Subsidiaries are a party,
relating to any labor contracts being negotiated, or otherwise that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.

 

5.15                        Solvency.

 

The Loan Parties, taken as a whole, are and, upon the incurrence of any
Obligations by the Loan Parties on any date on which this representation is
made, will be, Solvent.

 

5.16                        Matters Relating to Collateral.

 

A.            Creation, Perfection and Priority of Liens.  The execution and
delivery of the Collateral Documents by Loan Parties, together with (i) the
actions taken on or prior to the Effective Date and to be taken after the
Effective Date pursuant to subsection 6.8 and (ii) the delivery to
Administrative Agent of any Pledged Collateral not delivered to Administrative
Agent at the time of execution and delivery of the applicable Collateral
Document, in accordance with subsection 6.8 are (or will be with respect to
Collateral required to be delivered after the Effective Date, in accordance with
subsection 6.8) effective to create in favor of Administrative Agent for the
benefit of Lenders, as security for the respective Secured Obligations (as
defined in the applicable Collateral Document in respect of any Collateral), a
valid and perfected First Priority Lien on all of the Collateral (except to the
extent disclosed in the applicable Collateral Document), and all filings and
other actions necessary or desirable to perfect and maintain the perfection and
First Priority status of such Liens have been duly made or taken and remain in
full force and effect, other than the filing of any UCC financing statements
delivered to Administrative Agent for filing (but not yet filed)

 

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and the periodic filing of UCC continuation statements in respect of UCC
financing statements filed by or on behalf of Administrative Agent.

 

B.            Governmental Authorizations.  Except as described in subsection
5.2C, no authorization, approval or other action by, and no notice to or filing
with, any governmental authority or regulatory body is required for either
(i) the pledge or grant by any Loan Party of the Liens purported to be created
in favor of Administrative Agent pursuant to any of the Collateral Documents or
(ii) the exercise by Administrative Agent of any rights or remedies in respect
of any Collateral (whether specifically granted or created pursuant to any of
the Collateral Documents or created or provided for by applicable law), except
for filings or recordings contemplated by subsection 5.16A and except as may be
required, in connection with the disposition of any Pledged Collateral, by laws
generally affecting the offering and sale of Securities, including the
Hart-Scott-Rodino Act.

 

C.            Absence of Third-Party Filings.  Except such as may have been
filed in favor of Administrative Agent as contemplated by subsection 5.16A or as
permitted under subsection 7.2, no effective UCC financing statement, fixture
filing or other instrument similar in effect covering all or any part of the
Collateral is on file in any filing or recording office, except as may affect
Collateral with a value not in excess of $5,000,000.

 

D.            Margin Regulations.  The pledge of the Pledged Collateral pursuant
to the Collateral Documents does not violate Regulation T, U or X of the Board
of Governors of the Federal Reserve System.

 

E.             Information Regarding Collateral.  All information supplied to
Administrative Agent by or on behalf of any Loan Party with respect to any of
the Collateral (in each case taken as a whole with respect to any particular
Collateral) is accurate and complete in all material respects.

 

5.17                        Disclosure.

 

No representation or warranty of any Loan Party or any of their Subsidiaries
contained in any Loan Document or in any other document, certificate or written
statement furnished to Lenders by or on behalf of any Loan Party or any of their
Subsidiaries for use in connection with the transactions contemplated by this
Agreement contains any untrue statement of a material fact or omits to state a
material fact (known to Holdings or Borrower, in the case of any document not
furnished by it) necessary in order to make the statements contained herein or
therein not misleading in any material manner in light of the circumstances in
which the same were made.  Any projections and pro forma financial information
contained in such materials are based upon good faith estimates and assumptions
believed by Holdings or Borrower to be reasonable at the time made, it being
recognized by Lenders that such projections as to future events are not to be
viewed as facts and that actual results during the period or periods covered by
any such projections may differ from the projected results.  There are no facts
known (or which should upon the reasonable exercise of diligence be known) to
Holdings or Borrower (other than matters of a general economic nature) that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect and that

 

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have not been disclosed herein or in such other documents, certificates and
statements furnished to Lenders for use in connection with the transactions
contemplated hereby.

 

5.18                        REIT Status.

 

For the fiscal year ended December 31, 2002, Borrower qualified as a REIT under
the Internal Revenue Code.

 

5.19                        Insurance.

 

Holdings and its Subsidiaries currently maintain or require their
operators/lessees to maintain replacement cost insurance coverage in respect of
each of the Real Property Assets, as well as comprehensive general liability
insurance (including “builders’ risk”) against claims for personal, and bodily
injury and/or death, to one or more persons, or property damage, as well as
workers’ compensation insurance, in each case with respect to the Real Property
Assets in amounts that prudent owner of assets such as the Real Property Assets
would maintain and pursuant to the insurances certificates, binders and policies
provided to Administrative Agent on or prior to the Effective Date.

 

Section 6.              BORROWER’S AND HOLDINGS’ AFFIRMATIVE COVENANTS

 

Borrower and Holdings covenant and agree that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations, unless Requisite Lenders shall otherwise give written
consent, Borrower and Holdings shall perform, and shall cause each of their
Subsidiaries to perform, all covenants in this Section 6.

 

6.1                               Financial Statements and Other Reports.

 

Borrower and Holdings will maintain, and cause each of their Subsidiaries to
maintain, a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements in
conformity with GAAP.  Borrower will deliver to Administrative Agent:

 

(i)            Quarterly Financials:  as soon as available and in any event
within five Business Days after filing with the Securities and Exchange
Commission, copies of  Holdings’ Quarterly Report on Form 10-Q prepared in
compliance with the requirements therefor and filed with the Securities and
Exchange Commission;

 

(ii)           Year-End Financials:  as soon as available and in any event
within five Business Days after filing with the Securities and Exchange
Commission, copies of Holdings’ Annual Report on Form 10-K for such fiscal year
(together with the Holdings’ annual report to shareholders, if any, prepared
pursuant to Rule 14a-3 under the Exchange Act) prepared in accordance with the
requirements therefor and filed with the Securities and Exchange Commission;

 

(iii)          Officers’ and Compliance Certificates:  together with each
delivery of financial statements of Holdings and its Subsidiaries pursuant to
subdivisions (i) and

 

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(ii) above, (a) an Officers’ Certificate of Borrower stating that the signers
have reviewed the terms of this Agreement and have made, or caused to be made
under their supervision, a review in reasonable detail of the transactions and
condition of Holdings and its Subsidiaries during the accounting period covered
by such financial statements and that such review has not disclosed the
existence during or at the end of such accounting period, and that the signers
do not have knowledge of the existence as at the date of such Officers’
Certificate, of any condition or event that constitutes an Event of Default or
Potential Event of Default, or, if any such condition or event existed or
exists, specifying the nature and period of existence thereof and what action
Holdings or Borrower has taken, is taking and proposes to take with respect
thereto; and (b) a Compliance Certificate demonstrating in reasonable detail
compliance during and at the end of the applicable accounting periods with the
restrictions contained in Section 7 to the extent compliance with such
restrictions is required to be tested at the end of the applicable accounting
period;

 

(iv)          Reconciliation Statements:  if, as a result of any change in
accounting principles and policies from those used in the preparation of the
audited financial statements referred to in subsection 5.3 (other than an
immaterial change in GAAP), the combined consolidated financial statements of
Holdings and its Subsidiaries delivered pursuant to subdivisions (i) or (ii) of
this subsection 6.1 will differ in any material respect from the combined
consolidated financial statements that would have been delivered pursuant to
such subdivisions had no such change in accounting principles and policies been
made, then (a) together with the first delivery of financial statements pursuant
to subdivision (i) or (ii) of this subsection 6.1 following such change,
combined consolidated financial statements of Holdings and its Subsidiaries for
(y) the current Fiscal Year to the effective date of such change and (z) the
full Fiscal Year immediately preceding the Fiscal Year in which such change is
made, in each case prepared on a pro forma basis as if such change had been in
effect during such periods, and (b) together with each delivery of financial
statements pursuant to subdivision (i) or (ii) of this subsection 6.1 following
such change, if required pursuant to subsection 1.2, a written statement of the
chief accounting officer or chief financial officer of Borrower or other person
designated in writing by such officers or Borrower and approved by
Administrative Agent, such approval not to be unreasonably withheld, setting
forth the differences (including any differences that would affect any
calculations relating to the financial covenants set forth in subsection 7.6)
which would have resulted if such financial statements had been prepared without
giving effect to such change;

 

(v)           Events of Default, etc.:  promptly upon any Executive Officer of
Holdings or Borrower obtaining knowledge (a) of any condition or event that
constitutes an Event of Default or Potential Event of Default, or becoming aware
that any Lender has given any notice (other than to Administrative Agent) or
taken any other action with respect to a claimed Event of Default or Potential
Event of Default, (b) that any Person has given any notice to Holdings or any of
its Subsidiaries or taken any other action with respect to a claimed default or
event or condition of the type referred to in subsection 8.2 that could
reasonably be expected to have a Material Adverse Effect, (c) of any resignation
or dismissal of Holdings’ independent

 

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accountant, (d) of any Change of Control or other event requiring a prepayment
of principal on the Senior Notes or any Subordinated Indebtedness or causing an
event of default thereunder, or (e) of the occurrence of any event or change
that has caused or evidences, either in any case or in the aggregate, a Material
Adverse Effect, an Officers’ Certificate specifying the nature and period of
existence of such condition, event or change, or specifying the notice given or
action taken by any such Person and the nature of such claimed Event of Default,
Potential Event of Default, default, event or condition, and what action
Borrower has taken, is taking and proposes to take with respect thereto;

 

(vi)          Litigation or Other Proceedings:  promptly upon any Executive
Officer of Borrower obtaining knowledge of (X) the institution of, or (in the
good faith judgment of Borrower) non-frivolous threat of, any action, suit,
proceeding (whether administrative, judicial or otherwise), governmental
investigation or arbitration against or affecting Holdings or any of its
Subsidiaries or any property of Holdings or any of its Subsidiaries
(collectively, “Proceedings”) not previously disclosed in writing by Borrower to
Lenders or (Y) any material development in any Proceeding that, in any case:

 

(1)           if adversely determined, has a reasonable probability of giving
rise to a Material Adverse Effect; or

 

(2)           seeks to enjoin or otherwise prevent the consummation of, or to
recover any damages or obtain relief as a result of, the transactions
contemplated hereby;

 

written notice thereof together with such other information as may be reasonably
available to Borrower to enable Lenders and their counsel to evaluate such
matters;

 

(vii)         ERISA Events:  to the extent applicable, promptly upon becoming
aware of the occurrence of or forthcoming occurrence of any ERISA Event, a
written notice specifying the nature thereof, what action Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates has taken, is taking or
proposes to take with respect thereto and, when known, any action taken or
threatened by the Internal Revenue Service, the Department of Labor or the PBGC
with respect thereto;

 

(viii)        ERISA Notices:  after the occurrence of an Event of Default, with
reasonable promptness, copies of (a) each Schedule B (Actuarial Information) to
the annual report (Form 5500 Series) filed by Holdings, any of its Subsidiaries
or any of their respective ERISA Affiliates with the Internal Revenue Service
with respect to each Pension Plan; (b) all notices received by Holdings, any of
its Subsidiaries or any of their respective ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event; and (c) copies of such
other documents or governmental reports or filings relating to any Employee
Benefit Plan as Administrative Agent shall reasonably request;

 

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(ix)           Insurance:  upon the prior written request of Administrative
Agent, as soon as practicable and in any event by the last day of any Fiscal
Year and no more frequently than once in any Fiscal Year, a report in form and
substance reasonably satisfactory to Administrative Agent outlining all material
insurance coverage maintained as of the date of such report by Holdings and its
Subsidiaries and all material insurance coverage planned to be maintained by
Holdings and its Subsidiaries in the immediately succeeding Fiscal Year;

 

(x)            New Subsidiaries:  promptly upon any Person becoming a Subsidiary
of Holdings, a written notice setting forth with respect to such Person (a) the
date on which such Person became a Subsidiary of Holdings and (b) all of the
data required to be set forth in Schedule 5.1 annexed hereto with respect to all
Subsidiaries of Holdings (it being understood that such written notice shall be
deemed to supplement Schedule 5.1 annexed hereto for all purposes of this
Agreement);

 

(xi)           Margin Determination Certificate:  commencing with the Fiscal
Quarter ended September 2003, together with each delivery of financial
statements pursuant to subdivisions (i) and (ii) above, a Margin Determination
Certificate demonstrating in reasonable detail the calculation of the Total
Leverage Ratio for the four consecutive Fiscal Quarters ending on the last day
of the accounting period covered by such financial statements;

 

(xii)          Revisions or Updates to Schedules:  should any of the information
or disclosures provided on Schedule 5.1 or on any of the Schedules originally
attached to any of the Collateral Documents become outdated or incorrect in any
material respect, such revisions or updates to such Schedules as may be
necessary or appropriate to update or correct such Schedules; in addition to the
foregoing, such revisions or updates to the Schedules attached to the Loan
Documents as Administrative Agent may reasonably request, any such request to be
made no more frequently than once per quarter; provided that except for
additions of new Subsidiaries to Schedule 5.1 in accordance with subsection
6.1(x) above, in each case no such revisions or updates to any Schedules shall
be deemed to have amended, modified or superseded such Schedules immediately
prior to the submission of such revised or updated Schedules, or to have cured
any breach of warranty or representation resulting from the inaccuracy or
incompleteness of any such Schedules, unless and until the Requisite Lenders in
their sole and absolute discretion, shall have accepted in writing such
revisions or updates to such Schedules; and

 

(xiii)         Other Information: with reasonable promptness, such other
information and data with respect to Holdings, Borrower or any of their
Subsidiaries as from time to time may be reasonably requested by any Lender.

 

6.2                               Corporate Existence, etc.

 

Except as permitted under subsection 7.7, Borrower and Holdings will, and will
cause each of their Subsidiaries to, at all times preserve and keep in full
force and effect its corporate existence and all rights and franchises material
to its business; provided, however that neither

 

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Holdings, Borrower nor any of their Subsidiaries shall be required to preserve
any such right or franchise or such existence in the case of Subsidiaries if the
Board of Directors of Holdings, Borrower or such Subsidiary shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of Holdings, Borrower or such Subsidiary, as the case may be, and that the loss
thereof is not disadvantageous in any material respect to the Loan Parties taken
as a whole or Lenders.

 

6.3                               Payment of Taxes and Claims; Tax
Consolidation.

 

A.            Borrower and Holdings will, and will cause each of their
Subsidiaries to, pay all material taxes, assessments and other governmental
charges imposed upon them or any of their properties or assets or in respect of
any of their income, businesses or franchises before any material penalty
accrues thereon, and all material claims (including claims for labor, services,
materials and supplies) for sums that have become due and payable and that by
law have or may become a Lien upon any of its properties or assets, prior to the
time when any penalty or fine shall be incurred with respect thereto; provided
that no such charge or claim need be paid if it is being contested in good faith
by appropriate proceedings promptly instituted and diligently conducted, so long
as (1) such reserve or other appropriate provision, if any, as shall be required
in conformity with GAAP shall have been made therefor and (2) in the case of a
charge or claim which has or may become a Lien against any of the Collateral,
such contest proceedings conclusively operate to stay the sale of any portion of
the Collateral to satisfy such charge or claim.

 

B.            Borrower and Holdings will not, nor will it permit any of their
Subsidiaries to, file or consent to the filing of any consolidated income tax
return with any Person (other than Holdings or any of its Subsidiaries).

 

6.4                               Maintenance of Properties; Insurance.

 

A.            Maintenance of Properties.  Borrower and Holdings will, and will
cause each of their Subsidiaries to, maintain or cause to be maintained in good
repair, working order and condition, ordinary wear and tear excepted, all
material properties used or useful in the business of Borrower and Holdings and
their Subsidiaries (including all Intellectual Property) and from time to time
will make or cause to be made all appropriate repairs, renewals and replacements
thereof, except where, individually or in the aggregate, the failure to do so
could not reasonably be expected to have a Material Adverse Effect.

 

B.            Insurance.  Borrower and Holdings will maintain or cause to be
maintained, with financially sound and reputable insurers, such public liability
insurance, third party property damage insurance, business interruption
insurance and casualty insurance with respect to liabilities, losses or damage
in respect of the assets, properties and businesses of Holdings and its
Subsidiaries as may customarily be carried or maintained under similar
circumstances by corporations of established reputation engaged in similar
businesses, in each case in such amounts (giving effect to self-insurance), with
such deductibles, covering such risks and otherwise on such terms and conditions
as shall be customary for corporations similarly situated in the industry. 
Holdings or Borrower shall provide Administrative Agent from time to time, upon
request (i) copies of the policies under which such insurance is issued,

 

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certificates of insurance and such other information relating to such insurance
as the Administrative Agent may request, (ii) with respect to any policy
providing for coverage in excess of $25,000,000, within five days of receipt of
notice from any insurer, a copy of any notice of cancellation or material change
in coverage and (iii) with respect to any policy providing for coverage in
excess of $25,000,000, on the day of issuance, notice of any cancellation or
nonrenewal of coverage by Holdings or its Subsidiaries.

 

6.5                               Inspection Rights Lender Meeting.

 

A.            Inspection Rights.  Borrower and Holdings shall, and shall cause
each of their Subsidiaries to, permit any authorized representatives designated
by any Lender to visit and inspect, subject to the rights of any tenants or
lessees of Holdings and its Subsidiaries, any of the properties of Holdings or
of any of its Subsidiaries, to inspect, copy and take extracts from its and
their financial and accounting records, and to discuss its and their affairs,
finances and accounts with its and their officers and independent public
accountants, all upon reasonable notice and at such reasonable times during
normal business hours and as often as may reasonably be requested.  Lenders
shall coordinate their visits and inspections with those of Administrative Agent
so as to minimize the number of separate visits to Borrower’s and Holdings’
premises.

 

B.            Lender Meeting.  Borrower will, upon the request of Administrative
Agent, participate in a meeting of Administrative Agent and Lenders once during
each Fiscal Year to be held at Borrower’s corporate offices (or at such other
location as may be agreed to by Borrower and Administrative Agent) at such time
as may be agreed to by Borrower and Administrative Agent.

 

6.6                               Compliance with Laws, etc.

 

Borrower and Holdings shall comply, and shall cause each of their Subsidiaries
and all other Persons on or occupying any Real Property Assets to comply, with
the requirements of all applicable laws, rules, regulations and orders of any
governmental authority (including all Environmental Laws), noncompliance with
which could reasonably be expected to cause, individually or in the aggregate, a
Material Adverse Effect.

 

6.7                               Environmental Review and Investigation,
Disclosure, Etc.; Borrower’s Actions Regarding Hazardous Materials Activities,
Environmental Claims and Violations of Environmental Laws.

 

A.            Environmental Review and Investigation.  Borrower and Holdings
agree that Administrative Agent may, from time to time and in its reasonable
discretion, if a Potential Event of Default relating to environmental matters or
an Event of Default has occurred and is continuing, retain, at Borrower’s
expense, an independent professional consultant to review any environmental
audits, investigations, analyses and reports relating to Hazardous Materials
prepared by or for Holdings or Borrower or conduct its own investigation of any
Real Property Asset.  For purposes of conducting such a review and/or
investigation, Borrower and Holdings hereby grant to Administrative Agent and
its agents, employees, consultants and contractors the right to enter into or
onto any Real Property Assets currently owned, leased, operated or

 

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used by Holdings or Borrower or any of their Subsidiaries, subject to the rights
of any tenants or lessees of Holdings and its Subsidiaries, and to perform
so-called “Phase I” environmental assessment tests on such property.  Any such
investigation of any Real Property Asset shall be conducted, unless otherwise
agreed to by Holdings or Borrower and Administrative Agent, during normal
business hours and shall be conducted so as not to interfere with the ongoing
operations at such Real Property Asset or to cause any damage or loss to any
property at such Real Property Asset.  Holdings, Borrower and Administrative
Agent hereby acknowledge and agree that any report of any investigation
conducted at the request of Administrative Agent pursuant to this subsection
6.7A will be obtained and shall be used by Administrative Agent and Lenders
solely for the purposes of Lenders’ internal credit decisions, to monitor and
police the Loans and to protect Lenders’ security interests, if any, created by
the Loan Documents.  Administrative Agent agrees to deliver a copy of any such
report to Holdings or Borrower with the understanding that Borrower acknowledges
and agrees that (x) it will indemnify and hold harmless Administrative Agent and
each Lender from any costs, losses or liabilities relating to Borrower’s use of
or reliance on such report, (y) neither Administrative Agent nor any Lender
makes any representation or warranty with respect to such report, and (z) by
delivering such report to Borrower, neither Administrative Agent nor any Lender
is requiring or recommending the implementation of any suggestions or
recommendations contained in such report.

 

B.            Environmental Disclosure.  If reasonably required by
Administrative Agent, Borrower will deliver to Administrative Agent:

 

(i)            Environmental Audits and Reports.  As soon as practicable
following receipt thereof, copies of all material environmental audits,
investigations, analyses and reports of any kind or character, whether prepared
by personnel of Holdings, Borrower or any of their Subsidiaries or by
independent consultants, governmental authorities or any other Persons, with
respect to significant environmental matters at any Real Property Asset which,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect or with respect to any Environmental Claims which,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect; and

 

(ii)           Other Information.  With reasonable promptness, such other
documents and information as from time to time may be reasonably requested by
Administrative Agent in relation to any matters disclosed pursuant to this
subsection 6.7.

 

C.            Holdings’ and Borrower’s Actions Regarding Hazardous Materials
Activities, Environmental Claims and Violations of Environmental Laws.  Borrower
and Holdings shall promptly take, and shall cause each of their Subsidiaries
promptly to take, any and all actions necessary to (i) cure any violation of
applicable Environmental Laws by Holdings, Borrower or their Subsidiaries that
could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect and (ii) make an appropriate response to any
Environmental Claim against Holdings, Borrower or any of their Subsidiaries and
discharge any obligations it may have to any Person thereunder where failure to
do so could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.

 

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6.8                               Execution of Subsidiary Guaranty and Personal
Property Collateral Documents by Certain Subsidiaries and Future Subsidiaries.

 

A.            Execution of Subsidiary Guaranty and Personal Property Collateral
Documents.  If any Person is or becomes a wholly-owned Subsidiary of Holdings
after the date hereof, Borrower will promptly notify Administrative Agent of
that fact and cause such Subsidiary to execute and deliver to Administrative
Agent a counterpart of the Subsidiary Guaranty and the Pledge Agreement and to
take all such further actions and execute all such further documents and
instruments (including actions, documents and instruments comparable to those
described in subsection 4.1E) as may be necessary or, in the opinion of
Administrative Agent, desirable to create in favor of Administrative Agent, for
the benefit of Lenders, a valid First Priority Lien on all of the Collateral of
or relating to such Subsidiary and owned by Holdings or its Subsidiaries as
described in the applicable forms of the Collateral Documents; provided that
with respect to Subsidiaries organized in jurisdictions outside the United
States, such guaranties, pledges and other documentation shall be required only
to the extent they are not reasonably likely to result in material increased tax
liabilities for the Loan Parties, as determined in Administrative Agent’s
reasonable discretion.

 

B.            Subsidiary Charter Documents, Legal Opinions, Etc.  To the extent
reasonably requested by Administrative Agent, Borrower shall deliver to
Administrative Agent, together with such Loan Documents, (i) certified copies of
such Subsidiary’s Certificate or Articles of Incorporation, together with a good
standing certificate from the Secretary of State of the jurisdiction of its
incorporation and each other state in which such Person is qualified as a
foreign corporation to do business and, to the extent generally available, a
certificate or other evidence of good standing as to payment of any applicable
franchise or similar taxes from the appropriate taxing authority of each of such
jurisdictions, each to be dated a recent date prior to their delivery to
Administrative Agent, (ii) a copy of such Subsidiary’s Bylaws, certified by its
corporate secretary or an assistant secretary as of a recent date prior to their
delivery to Administrative Agent, (iii) a certificate executed by the secretary
or an assistant secretary of such Subsidiary as to (a) the fact that the
attached resolutions of the Board of Directors of such Subsidiary approving and
authorizing the execution, delivery and performance of such Loan Documents are
in full force and effect and have not been modified or amended and (b) the
incumbency and signatures of the officers of such Subsidiary executing such Loan
Documents, and (iv) a favorable opinion of counsel to such Subsidiary, in form
and substance reasonably satisfactory to Administrative Agent and its counsel,
as to (a) the due organization and good standing of such Subsidiary, (b) the due
authorization, execution and delivery by such Subsidiary of such Loan Documents,
(c) the enforceability of such Loan Documents against such Subsidiary, (d) such
other matters (including matters relating to the creation and perfection of
Liens in any Collateral pursuant to such Loan Documents) as Administrative Agent
may reasonably request, all of the foregoing to be reasonably satisfactory in
form and substance to Administrative Agent and its counsel.

 

Section 7.              BORROWER’S AND HOLDINGS’ NEGATIVE COVENANTS

 

Borrower and Holdings covenant and agree that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations and the cancellation or expiration of all Letters of
Credit, unless Requisite Lenders

 

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shall otherwise give written consent, Borrower and Holdings shall perform, and
shall cause each of their Subsidiaries to perform, all covenants in this
Section 7.

 

7.1                               Indebtedness.

 

Borrower and Holdings shall not, and shall not permit any of their Subsidiaries
to, directly or indirectly, create, incur, assume or guaranty, or otherwise
become or remain directly or indirectly liable with respect to, any
Indebtedness, except:

 

(i)            Borrower may become and remain liable with respect to the
Obligations;

 

(ii)           Holdings and its Subsidiaries may become and remain liable with
respect to Contingent Obligations permitted by subsection 7.4 and, upon any
matured obligations actually arising pursuant thereto, the Indebtedness
corresponding to the Contingent Obligations so extinguished;

 

(iii)          Borrower and Holdings may become and remain liable with respect
to Indebtedness to any Subsidiary of Holdings; any Subsidiary Guarantor may
become and remain liable with respect to Indebtedness to Holdings, Borrower or
any of their Subsidiaries; any Subsidiary which is not a Subsidiary Guarantor
may become and remain liable with respect to Indebtedness to other Subsidiaries
which are not Subsidiary Guarantors; and any Subsidiary which is not a
Subsidiary Guarantor may become and remain liable with respect to Indebtedness
to Borrower, Holdings or any Subsidiary Guarantor in an aggregate amount which,
together with the other Investments made by Holdings, Borrower and Subsidiary
Guarantors after the date hereof in Subsidiaries which are not Subsidiary
Guarantors under subsection 7.3(vii)(d), does not exceed $15,000,000 at any time
outstanding for all such Subsidiaries which are not Subsidiary Guarantors;
provided that (a) all such intercompany Indebtedness shall be evidenced by
promissory notes except to the extent the issuance of such promissory notes may
impair Borrower’s qualification as a REIT, (b) all such intercompany
Indebtedness owed by Borrower and by Holdings or any Subsidiary Guarantors shall
be subordinated in right of payment to the payment in full of the Obligations
pursuant to the terms of the applicable promissory notes or an intercompany
subordination agreement, and (c) any payment by Holdings or any Subsidiary of
Holdings under any guaranty of the Obligations shall result in a pro tanto
reduction of the amount of any intercompany Indebtedness owed by Holdings or
such Subsidiary to Borrower or to any Subsidiary for whose benefit such payment
is made; and provided that intercompany obligations of Holdings and its
Subsidiaries constituting rental, lease, license or royalty payments, including
such payments deferred in the ordinary course of business and consistent with
past practices, do not constitute Indebtedness hereunder;

 

(iv)          Holdings, Borrower and their Subsidiaries may enter into a
securitization financing transaction with respect to any of their Lodging Assets
in an aggregate principal amount not to exceed $150,000,000 which securitization
transaction shall not terminate or have a maturity prior to six months after the

 

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Revolving Loan Commitment Termination Date; provided that the aggregate
Indebtedness incurred in connection with such securitization shall not be less
than an amount equal to 40% of the Fair Market Value of the assets encumbered by
or otherwise subject to such securitization and such assets shall not account
for or generate more than 20% of Consolidated EBITDA for the most recently ended
four consecutive Fiscal Quarter period as of the date of such securitization;

 

(v)           Borrower and Holdings may remain liable with respect to the Senior
Notes and may incur unsubordinated Indebtedness secured on the same basis as the
Indebtedness so refinanced and Subordinated Indebtedness to refinance all or any
of the Senior Notes; provided that (1) the obligor on such refinancing
Indebtedness is the same as the obligor on the Indebtedness so refinanced, (2)
all of the proceeds thereof (net of reasonable and customary fees, costs and
expenses) shall be applied to the repayment, repurchase, defeasance or
redemption of such Senior Notes, (3) the covenants of such refinancing
Indebtedness are not more restrictive in any material respect than the covenants
contained in the Indenture dated as of March 19, 2003, by and between Borrower,
Holdings and U.S. Bank Trust National Association, as trustee, with respect to
Borrower’s 8-7/8% Senior Notes due 2011, (4) such covenants shall be on
generally prevailing market terms available to Borrower and Holdings for such
refinancing Indebtedness, (5) the maturity date thereof or any scheduled date on
which such refinancing Indebtedness may be required to be repurchased at the
option of the holder thereof shall not be earlier than April 30, 2007 and (6)
notwithstanding anything to the contrary in the preceding clause (1), Holdings
may guarantee any such refinancing Indebtedness whether or not Holdings may have
previously been an obligor with respect to the Indebtedness being refinanced
(collectively, the “Refinancing Indebtedness”);

 

(vi)          In addition to any Subordinated Indebtedness incurred or existing
pursuant to subsection 7.1(v), Borrower and Holdings may become and remain
liable with respect to Subordinated Indebtedness in an aggregate principal
amount not to exceed $200,000,000 at any one time outstanding;

 

(vii)         Holdings, Borrower and their Subsidiaries may become and remain
liable with respect to any secured Indebtedness and other secured obligations;
provided, that, at the time of any such incurrence, the amount of such secured
Indebtedness and other secured obligations then outstanding (including
Indebtedness under subsection 7.1(iv), this subsection 7.1(vii) and subsection
7.1(viii), but excluding the Obligations and all Indebtedness required to be
secured equally and ratably in the same collateral as the Obligations) shall
not, individually or in the aggregate, exceed an amount equal to 10% of
Consolidated Net Tangible Assets;

 

(viii)        Holdings, Borrower and their Subsidiaries may remain liable with
respect to the Indebtedness of Holdings, Borrower and their Subsidiaries
existing as of the Effective Date and not otherwise permitted under this
subsection 7.1 (and any refinancings, replacements or substitutions thereof
which do not increase the amount thereof or increase any collateral therefor)
and described in Schedule 7.1 annexed hereto; and

 

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(ix)           Holdings, Borrower and their Subsidiaries may incur other
unsecured Indebtedness not expressly permitted under clauses (i) through (viii),
inclusive, of subsection 7.1 in an aggregate principal amount not to exceed
$40,000,000 at any time outstanding.

 

7.2                               Liens and Related Matters.

 

A.            Prohibition on Liens.  Borrower and Holdings shall not, and shall
not permit any of their Subsidiaries to, directly or indirectly, create, incur,
assume or permit to exist any Lien on or with respect to any property or asset
of any kind (including any document or instrument in respect of goods or
accounts receivable) of Borrower and Holdings or any of their Subsidiaries,
whether now owned or hereafter acquired, or any income or profits therefrom, or
file or permit the filing of, or permit to remain in effect, any financing
statement or other similar notice of any Lien with respect to any such property,
asset, income or profits under the UCC of any State or under any similar
recording or notice statute, except:

 

(i)            Permitted Encumbrances;

 

(ii)           Liens granted pursuant to the Collateral Documents, including
without limitation, Liens which equally and ratably secure to the extent
required by the Senior Note Documents, the aggregate principal amount of the
Senior Notes outstanding on the Effective Date;

 

(iii)          Liens described in Schedule 7.2 annexed hereto (and any
refinancings, replacements or substitutions thereof which do not increase the
amount thereof or increase any collateral therefor);

 

(iv)          Liens securing Indebtedness permitted pursuant to subsection
7.1(iv);

 

(v)           Liens securing Indebtedness and any other obligations permitted
pursuant to subsection 7.1(vii); and

 

(vi)          Liens in favor of vendors of goods and services in the ordinary
course of business securing Indebtedness permitted under subsection 7.1 incurred
in connection with the purchase of such goods and services, provided that such
Liens shall only encumber such goods so purchased.

 

B.            Equitable Lien in Favor of Lenders.  If Holdings or any of its
Subsidiaries shall create or assume any Lien upon any of its properties or
assets, whether now owned or hereafter acquired, other than Liens excepted by
the provisions of subsection 7.2A, Borrower shall make or cause to be made
effective provision whereby the Obligations will be secured by such Lien equally
and ratably with any and all other Indebtedness secured thereby as long as any
such Indebtedness shall be so secured; provided that, notwithstanding the
foregoing, this covenant shall not be construed as a consent by Requisite
Lenders to the creation or assumption of any such Lien not permitted by the
provisions of subsection 7.2A; and provided further that notwithstanding the
foregoing, if Holdings or any of its Subsidiaries shall create or assume any
Lien in favor of any Indebtedness permitted pursuant to subsection 7.1(v), it
shall make or cause to be made effective provision whereby the Obligations will
be secured by such

 

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Lien equally and ratably with any and all other Indebtedness secured thereby as
long as any such Indebtedness shall be so secured.

 

C.            No Further Negative Pledges.  Except with respect to (1)  specific
property encumbered to secure payment of particular Indebtedness, to be sold
pursuant to an executed agreement with respect to an asset sale or subject to a
customary lease or license, and (2) agreements set forth in documentation
governing Indebtedness permitted to be incurred under subsections 7.1(i) and
7.1(iv) – (vii) and Contingent Obligations permitted under subsection 7.4 with
respect to such Indebtedness, neither Holdings nor any of its Subsidiaries shall
enter into any agreement prohibiting the creation or assumption of any Lien upon
any of its properties or assets, whether now owned or hereafter acquired.

 

D.            No Restrictions on Subsidiary Distributions to Holdings, Borrower
or Other Subsidiaries.  Except as provided herein, Borrower and Holdings will
not, and will not permit any of their Subsidiaries to, create or otherwise cause
or suffer to exist or become effective any consensual encumbrance or restriction
of any kind on the ability of any such Subsidiary to (i) pay dividends or make
any other distributions on any of such Subsidiary’s capital stock owned by
Holdings, Borrower or any other Subsidiary of Holdings, (ii) repay or prepay any
Indebtedness owed by such Subsidiary to Holdings, Borrower or any other
Subsidiary of Holdings, (iii) make loans or advances to Holdings, Borrower or
any other Subsidiary of Holdings, or (iv) transfer any of its property or assets
to Holdings, Borrower or any other Subsidiary of Holdings; provided that the
foregoing shall not apply to (a) restrictions and conditions existing on the
date hereof and identified on Schedule 7.2 (or to any extension, renewal or
modification of such restriction or condition which is not materially more
disadvantageous to the Lenders), (b) customary restrictions and conditions
contained in agreements relating to asset sales permitted by this Agreement with
respect to the assets being sold, (c) customary restrictions or conditions
imposed by any agreement evidencing Indebtedness permitted under subsections
7.1(i) and 7.1(iv) - (vii) with respect to the assets subject to such
securitization transaction or Indebtedness, and (d) customary provisions in
leases and other contracts restricting the assignment thereof.

 

7.3                               Investments; Joint Ventures.

 

Borrower and Holdings shall not, and shall not permit any of their Subsidiaries
to, directly or indirectly, make or own any Investment in any Person, except:

 

(i)            Holdings and its Subsidiaries may make and own Investments in
Franchisees, Joint Ventures and Franchise Arrangements in Holdings’ and its
Subsidiaries’ ordinary course of business; provided that the amount of
additional  Investments shall not exceed $20,000,000 in the aggregate per Fiscal
Year (the “Annual Investment Amount”); provided that the Annual Investment
Amount for any Fiscal Year shall be increased by an amount equal to the excess,
if any, of the Annual Investment Amount for the previous Fiscal Year (without
giving effect to any adjustment in accordance with this proviso) over the actual
amount of such Investments for such Fiscal Year; provided, further that in no
event shall the amount of any such increase exceed 50% of the Annual Investment
Amount for such previous Fiscal Year (prior to adjustment in accordance with
this proviso);

 

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(ii)           Holdings and its Subsidiaries may make and own Investments in
Cash and Cash Equivalents;

 

(iii)          Holdings and its Subsidiaries may make Capital Expenditures
permitted by subsection 7.8;

 

(iv)          Holdings and its Subsidiaries may continue to own the Investments
owned by them and described in Schedule 7.3 annexed hereto;

 

(v)           Holdings and its Subsidiaries may make and own Investments with
respect to any obligation to indemnify their respective officers and directors
to the fullest extent permitted by the law of the jurisdiction of such Person’s
organization;

 

(vi)          Holdings and its Subsidiaries may make and own Investments which
do not require the payment of any Cash or non-cash consideration;

 

(vii)         (a) Holdings and its Subsidiaries may continue to own the
Investments owned by them in any Subsidiaries of Holdings; (b) Holdings,
Borrower and the Subsidiary Guarantors may make and own additional equity
Investments in Holdings, Borrower and in Subsidiary Guarantors; (c) Subsidiaries
which are not Subsidiary Guarantors may make Investments in other Subsidiaries;
and (d) Holdings, Borrower and Subsidiary Guarantors may make and own
Investments after the date hereof in other Subsidiaries which are not Subsidiary
Guarantors which Investments, including intercompany loans made by Holdings,
Borrower and Subsidiary Guarantors to Subsidiaries which are not Subsidiary
Guarantors pursuant to subsection 7.1(iii), do not exceed $15,000,000 at any
time outstanding;

 

(viii)        Holdings and its Subsidiaries may make intercompany loans to the
extent permitted under subsection 7.1(iii);

 

(ix)           Holdings and its Subsidiaries may receive and hold promissory
notes and other non-cash consideration received in connection with any Asset
Sale permitted by subsection 7.7; and

 

(x)            Holdings and its Subsidiaries may make and own Investments in
securities issued by the Meditrust Exercisable Put Option Securities Trust to
the extent owned as of the Effective Date or as permitted by subsection 7.5B.

 

7.4                               Contingent Obligations.

 

Borrower and Holdings shall not, and shall not permit any of their Subsidiaries
to, directly or indirectly, create or become or remain liable with respect to
any Contingent Obligation, except:

 

(i)            Borrower and Holdings may become and remain liable with respect
to Contingent Obligations in respect of Letters of Credit issued under this
Agreement, and Subsidiaries of Borrower and Holdings may become and remain
liable with respect to Contingent Obligations in respect of a Guaranty;

 

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(ii)           Holdings and its Subsidiaries may become and remain liable with
respect to Contingent Obligations in respect of customary indemnification and
purchase price adjustment obligations incurred in connection with (x) Asset
Sales or other sales of assets, and (y) Investments permitted under this
Agreement;

 

(iii)          Holdings and its Subsidiaries may become and remain liable with
respect to Contingent Obligations in respect of any Indebtedness of Holdings,
Borrower or any Subsidiaries permitted by subsection 7.1; provided that Holdings
and Subsidiaries of Holdings other than Borrower may not become liable in
respect of Indebtedness of Borrower under subsections 7.1(v) and 7.1(vi);
provided further that notwithstanding the foregoing, Holdings may become and
remain liable with respect to Contingent Obligations to the extent permitted by
clause (6) of subsection 7.1(v);

 

(iv)          Holdings and its Subsidiaries, as applicable, may remain liable
with respect to Contingent Obligations described in Schedule 7.4 annexed hereto;

 

(v)           Holdings and its Subsidiaries may become and remain liable with
respect to Contingent Obligations incurred in the ordinary course of business
with respect to surety and appeal bonds, performance bonds and other similar
obligations; and Holdings and its Subsidiaries may become and remain liable with
respect to Contingent Obligations in respect of letters of credit provided that
the aggregate amount of such Contingent Obligations shall not exceed
$10,000,000; and

 

(vi)          Borrower and Holdings may become and remain liable with respect to
Contingent Obligations under Hedge Agreements provided that the aggregate amount
of such Contingent Obligations shall not exceed $200,000,000.

 

7.5                               Restricted Payments.

 

A.            Borrower and Holdings shall not, and shall not permit any of their
Subsidiaries to, directly or indirectly, declare, order, pay, make or set apart
any sum for any Restricted Payment; provided, however, that:

 

(i)            Borrower may declare and pay dividends and distributions payable
in respect of Existing Preferred Stock; provided, that such dividends or
distributions are regularly scheduled and paid quarterly in accordance with
Borrower’s ordinary course of business;

 

(ii)           Borrower may declare and pay dividends in respect of its Class B
Common Stock in an amount not to exceed $0.10 per share per Fiscal Year; and
Borrower may redeem its Class B Common Stock for $.01 per share of such Class B
Common Stock;

 

(iii)          Borrower may declare and pay quarterly dividends and
distributions in an amount required for Borrower to maintain its REIT status;
provided that all existing and future net operating loss carry forwards must
first be applied to reduce REIT taxable income and to otherwise offset any
income tax liability and provided, further

 

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that the Borrower shall have first declared and paid all required dividends and
distributions described under clauses (i) and (ii) above;

 

(iv)          in addition to the payments under clauses (i), (ii) and (iii)
above, Holdings and Borrower may declare and pay cash dividends and make
distributions on account of or repurchase any of their capital stock; provided
that the aggregate amount thereof shall not exceed (a) $20,000,000 in any Fiscal
Year or (b) in the event that at the time of and after giving pro forma balance
sheet effect to any Revolving Loans made in connection with such payments, (1)
the Total Leverage Ratio is less than 4.50:1.00, (2) the Revolving Loan
Commitments exceed the Total Utilization of Revolving Loan Commitments by not
less than $50,000,000 and (3) no Potential Event of Default or Event of Default
then exists, $40,000,000 in any Fiscal Year; provided further that the maximum
aggregate annual amount of such dividends, distributions and repurchases which
is permitted pursuant to the foregoing proviso (the “Maximum Share Payment
Amount”) shall be increased by an amount equal to the excess, if any, of such
Maximum Share Payment Amount for any Fiscal Year (without giving effect to any
adjustment in accordance with this proviso) over the amount of such dividends,
distributions and repurchases which are actually made in such immediately
preceding Fiscal Year;

 

(v)           Borrower and Holdings may make Restricted Payments to redeem
shares of their capital stock or warrants or options to acquire any such shares
from employees of Borrower and Holdings and their Subsidiaries (a) upon the
death or other termination of employment of such employees, as authorized by the
terms of Holdings’ and its Subsidiaries’ stock option plans or (b) to the extent
required to permit any non-executive employees to meet their tax obligations;
provided that no Event of Default shall have occurred and be continuing or would
arise as a result of any such Restricted Payments;

 

(vi)          Holdings and Borrower may, within two years after issuance of
common stock (other than any issuance of common stock to employees or directors
of Holdings and its Subsidiaries), repurchase common stock or preferred stock of
Holdings or Borrower ; provided that (a) the amount of common stock and
preferred stock so repurchased shall not exceed the lesser of (x) the net cash
proceeds of such common stock issuance, after giving effect to all other
applications of such net cash proceeds by Holdings and its Subsidiaries and (y)
$100,000,000, and (b) at the time of any such repurchase and after giving pro
forma effect thereto, (x) there are no outstanding Revolving Loans and (y) the
amount of Cash and Cash Equivalents of Holdings and its Subsidiaries is not less
than the aggregate amount required to redeem, repurchase or repay Borrower’s
Senior Notes maturing or scheduled to be redeemable at the option of the holders
thereof in 2003 and 2004;

 

(vii)         Borrower and Holdings may make regularly scheduled payments of
interest on Subordinated Indebtedness permitted pursuant to subsections 7.1(v)
and (vi), in accordance with the terms of and to the extent required by, the
provisions of the indentures governing such Subordinated Indebtedness; provided
that no Potential

 

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Event of Default under subsection 8.1 or Event of Default shall have occurred
and be continuing or would arise as a result of such Restricted Payment; and

 

(viii)        Borrower and Holdings may redeem, repurchase, retire or otherwise
acquire, all or part of Borrower’s outstanding Series B Preferred Stock as part
or all of the purchase consideration for the sale of Telematrix Equipment, Inc.
and Telematrix Equipment, LLC, and Borrower or Holdings may issue preferred
stock having substantially the same terms and conditions as Borrower’s
outstanding Series B Preferred Stock in exchange for Borrower’s outstanding
Series B Preferred Stock..

 

B.            Borrower and Holdings shall not, and shall not permit any of their
Subsidiaries to, directly or indirectly, prepay, redeem, repurchase, retire,
defease or make any similar payment with respect to any Indebtedness (other than
Indebtedness under this Agreement); provided that if (A) no Potential Event of
Default or Event of Default shall have occurred and be continuing or would arise
as a result of the proposed payments (including all fees, call premiums or other
tender costs associated therewith), and (B) with respect to the following clause
(1), such prepayment or repurchase is completed on a basis that is economically
advantageous to Borrower and Holdings on a net present value basis, (1) Borrower
and Holdings may prepay, redeem, repurchase, retire, defease or make similar
payments with respect to Indebtedness maturing, or redeemable at the option of
the holder thereof to the extent the holder exercises such option, prior to the
Revolving Loan Commitment Termination Date, including without limitation
(i) Borrower’s 7.82% Senior Notes due September 2026, (ii) Borrower’s 7.25%
Senior Notes due March 2004, (iii) the 7.114% Securities, which securities will
not be thereafter sold or transferred by Borrower, (iv) Borrower’s 7.40% Notes
due September 2005, and (v) Borrower’s Medium Term Notes maturing in September
2005, January 2006 and February 2007; and (2) Holdings and its Subsidiaries may
prepay, redeem, repurchase, retire, defease or make similar payments with
respect to (A) intercompany Indebtedness permitted under this Agreement, (B)
secured Indebtedness permitted under this Agreement upon the sale or other
disposition of the collateral securing such secured Indebtedness and (C)
Borrower’s Senior Notes due August 2007 to the extent such redemption,
repurchase or repayment is made out of the proceeds of Refinancing Indebtedness
permitted by subsection 7.1(v) and at the time of and after giving effect to
such redemption, repurchase or repayment there are no outstanding Revolving
Loans and the amount of Cash and Cash Equivalents of Holdings and its
Subsidiaries is not less than the aggregate amount required to redeem,
repurchase or repay all of the Borrower’s Senior Notes maturing or scheduled to
be redeemable at the option of the holders thereof prior to the Revolving Loan
Commitment Termination Date.  In addition, notwithstanding the foregoing,
Borrower and Holdings shall be permitted to exercise their repurchase option
with respect to the 7.114% Notes.

 

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7.6                               Financial Covenants.

 

A.            Maximum Total Leverage Ratio.  Borrower and Holdings shall not
permit the Total Leverage Ratio on the last day of any Fiscal Quarter set forth
below to exceed the correlative ratio indicated below:

 

Period

 

Maximum Total Leverage
Ratio

 

 

 

 

 

3rd Fiscal Quarter, Fiscal Year 2003 

 

5.35:1.00

 

4th Fiscal Quarter, Fiscal Year 2003

 

5.35:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2004

 

5.30:1.00

 

2nd Fiscal Quarter, Fiscal Year 2004

 

5.30:1.00

 

3rd Fiscal Quarter, Fiscal Year 2004

 

5.30:1.00

 

4th Fiscal Quarter, Fiscal Year 2004

 

5.30:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2005

 

5.20:1.00

 

2nd Fiscal Quarter, Fiscal Year 2005

 

5.10:1.00

 

3rd Fiscal Quarter, Fiscal Year 2005

 

5.00:1.00

 

4th Fiscal Quarter, Fiscal Year 2005

 

5.00:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2006

 

4.75:1.00

 

2nd Fiscal Quarter, Fiscal Year 2006

 

4.75:1.00

 

3rd Fiscal Quarter, Fiscal Year 2006

 

4.75:1.00

 

4th Fiscal Quarter, Fiscal Year 2006

 

4.75:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2007

 

4.50:1.00

 

 

B.            Minimum Interest Coverage Ratio.  Borrower and Holdings shall not
permit the ratio of (i) Consolidated EBITDA to (ii) Consolidated Net Interest
Expense for any four consecutive Fiscal Quarter period ending on the last day of
any Fiscal Quarter to be less than the correlative ratio indicated below:

 

Period

 

Minimum Interest Coverage
Ratio

 

 

 

 

 

3rd Fiscal Quarter, Fiscal Year 2003

 

2.10:1.00

 

4th Fiscal Quarter, Fiscal Year 2003

 

2.10:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2004

 

2.10:1.00

 

2nd Fiscal Quarter, Fiscal Year 2004

 

2.10:1.00

 

3rd Fiscal Quarter, Fiscal Year 2004

 

2.10:1.00

 

4th Fiscal Quarter, Fiscal Year 2004

 

2.10:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2005

 

2.20:1.00

 

2nd Fiscal Quarter, Fiscal Year 2005

 

2.20:1.00

 

3rd Fiscal Quarter, Fiscal Year 2005

 

2.20:1.00

 

4th Fiscal Quarter, Fiscal Year 2005

 

2.20:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2006

 

2.30:1.00

 

2nd Fiscal Quarter, Fiscal Year 2006

 

2.30:1.00

 

3rd Fiscal Quarter, Fiscal Year 2006

 

2.30:1.00

 

4th Fiscal Quarter, Fiscal Year 2006

 

2.30:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2007

 

2.40:1.00

 

 

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C.            Minimum Fixed Charge Coverage Ratio.  Borrower and Holdings shall
not permit the ratio of (i) Consolidated EBITDA minus the Capital Expenditure
Reserve to (ii) Fixed Charges for any four consecutive Fiscal Quarter period
ending on the last day of any Fiscal Quarter to be less than the correlative
ratio indicated below:

 

Period

 

Minimum Fixed Charge
Coverage Ratio

 

 

 

 

 

3rd Fiscal Quarter, Fiscal Year 2003

 

1.35:1.00

 

4th Fiscal Quarter, Fiscal Year 2003

 

1.35:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2004

 

1.35:1.00

 

2nd Fiscal Quarter, Fiscal Year 2004

 

1.35:1.00

 

3rd Fiscal Quarter, Fiscal Year 2004

 

1.35:1.00

 

4th Fiscal Quarter, Fiscal Year 2004

 

1.35:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2005

 

1.45:1.00

 

2nd Fiscal Quarter, Fiscal Year 2005

 

1.45:1.00

 

3rd Fiscal Quarter, Fiscal Year 2005

 

1.45:1.00

 

4th Fiscal Quarter, Fiscal Year 2005

 

1.45:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2006

 

1.55:1.00

 

2nd Fiscal Quarter, Fiscal Year 2006

 

1.55:1.00

 

3rd Fiscal Quarter, Fiscal Year 2006

 

1.55:1.00

 

4th Fiscal Quarter, Fiscal Year 2006

 

1.55:1.00

 

 

 

 

 

1st Fiscal Quarter, Fiscal Year 2007

 

1.55:1.00

 

 

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D.            Minimum Consolidated Tangible Net Worth.  Borrower and Holdings
shall not permit Consolidated Tangible Net Worth as of the last day of any given
Fiscal Quarter in any given Fiscal Year to be less than $700,000,000.

 

7.7                               Restriction on Fundamental Changes; Asset
Sales and Acquisitions.

 

Borrower and Holdings shall not, and shall not permit any of their Subsidiaries
to, alter the corporate, capital or legal structure of Borrower and Holdings or
any of their Subsidiaries (including issuing any preferred stock unless
permitted hereunder), or enter into any transaction of merger or consolidation,
or liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease or sub-lease (as lessor or sublessor),
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, property or assets, whether now
owned or hereafter acquired, or acquire by purchase or otherwise all or
substantially all the business, property or fixed assets of, or stock or other
evidence of beneficial ownership of, any Person or any division or line of
business of any Person (other than purchases or other acquisitions of inventory,
materials and equipment in the ordinary course of Holdings’, Borrower’s, or any
of their Subsidiaries’, business), except:

 

(i)            any Subsidiary of Borrower or Holdings may be merged with or into
Holdings, Borrower or any Subsidiary Guarantor, or be liquidated, wound up or
dissolved, or all or any part of any Subsidiary’s business, property or assets
may be conveyed, sold, leased, transferred or otherwise disposed of, in one
transaction or a series of transactions, to Holdings, Borrower or any Subsidiary
Guarantor; provided that, in the case of any merger, Holdings, Borrower or such
Subsidiary Guarantor shall be the continuing or surviving corporation;

 

(ii)           Holdings and its Subsidiaries may make Capital Expenditures
permitted (including Permitted Acquisitions) under subsection 7.8 and
Investments permitted under subsection 7.3;

 

(iii)          Holdings and its Subsidiaries may sell or otherwise dispose of
assets in transactions that do not constitute Asset Sales; provided that the
consideration received for such assets shall be in an amount at least equal to
the fair market value thereof;

 

(iv)          Holdings and its Subsidiaries may make (a) Asset Sales and (b)
sales in any calendar year of Lodging Assets which sales under this clause (b)
do not, individually or in the aggregate generate more than 15% of Consolidated
EBITDA for the most recently ended four consecutive Fiscal Quarter period;

 

(v)           Holdings and its Subsidiaries may grant leases and subleases to
other Persons in the ordinary course of business not materially interfering with
the conduct of the business of Holdings or any of its Subsidiaries; and

 

(vi)          Holdings and its Subsidiaries may enter into and consummate the
sale of Telematrix Equipment, Inc. and Telematrix Equipment, LLC, which
companies provide telecommunications products and services.

 

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7.8                               Capital Expenditures.

 

A.            Borrower and Holdings shall not, and shall not permit their
Subsidiaries to, make or incur Capital Expenditures in excess of $80,000,000
from January 1, 2003 to December 31, 2003, and in excess of $95,000,000 per
Fiscal Year for each Fiscal Year thereafter (the “Annual CapEx Amount”);
provided that (i) the Annual CapEx Amount for any Fiscal Year shall be increased
by an amount equal to the excess, if any, but in no event more than $30,000,000,
of the Annual CapEx Amount for the previous Fiscal Year (without giving effect
to any adjustment in accordance with this proviso) over the actual amount of
such Capital Expenditures for such previous Fiscal Year, (ii) Permitted
Reinvestment Capital Expenditures and Investments shall not be included in
Capital Expenditures for purposes of determining the Annual CapEx Amount, and
(iii) Holdings and its Subsidiaries may make up to an additional $300,000,000 in
the aggregate of Capital Expenditures (which shall not be included for purposes
of determining the Annual CapEx Amount) after the Effective Date in connection
with one or more Permitted Acquisitions and related Conversion Costs if, in the
case of this clause (iii), both at the time of and immediately after giving
effect to any such Capital Expenditures and any related Revolving Loans made in
connection therewith, the Total Leverage Ratio is less than or equal to the
lower of (x) the then-required Total Leverage Ratio under subsection 7.6A less
0.25 or (y) 5.00:1.00, and the Revolving Loan Commitments exceed the Total
Utilization of Revolving Loan Commitments by not less than $50,000,000.

 

B.            In addition to Capital Expenditures permitted to be made pursuant
to subsection 7.8A, Holdings and its Subsidiaries may make Permitted
Reinvestment Capital Expenditures.

 

7.9                               Disposal of Subsidiary Stock.

 

Except for any sale of 100% of the capital stock or other equity Securities of
any of their Subsidiaries in compliance with the provisions of subsection 7.7
and any pledge permitted under subsection 7.2, Borrower and Holdings shall not:

 

(i)            directly or indirectly sell, assign, pledge or otherwise encumber
or dispose of any shares of capital stock or other equity Securities of any of
their Subsidiaries, except to qualify directors if required by applicable law;
or

 

(ii)           permit any of their Subsidiaries directly or indirectly to sell,
assign, pledge or otherwise encumber or dispose of any shares of capital stock
or other equity Securities of any of their Subsidiaries (including such
Subsidiary), except to Holdings or Borrower, another Subsidiary of Holdings or
Borrower, or to qualify directors if required by applicable law.

 

7.10                        Conduct of Business.

 

Borrower and Holdings shall not, and shall not permit any of their Subsidiaries
to, engage in any business other than (i) the businesses engaged in by Holdings,
Borrower and their Subsidiaries on the Closing Date and similar or related
businesses and any business related to the lodging industry, and (ii) such other
lines of business as may be consented to by Requisite Lenders.

 

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7.11                        Amendments or Waivers of Related Agreements.

 

Unless the prior written consent of Requisite Lenders is obtained, neither
Borrower nor Holdings nor any of their Subsidiaries will agree to any amendment
to any Senior Note Documents, Subordinated Indebtedness or Refinancing
Indebtedness if the effect of such amendment, together with all other amendments
made, is to increase the obligations of the obligor thereunder in a manner which
is materially adverse to Lenders or to confer any material additional rights on
the holders of such Indebtedness (or a trustee or other representative on their
behalf) in a manner which is materially adverse to Lenders or which would
otherwise be adverse in any material respect to the obligor thereunder or
Lenders.

 

7.12                        Fiscal Year.

 

Borrower and Holdings shall not change their Fiscal Year-end from December 31,
provided that Borrower and Holdings may change their Fiscal Year-end date to a
date which is the last Saturday prior to or after December 31.

 

7.13                        Public Company.

 

Borrower or Holdings shall not cease to have its Common Stock listed on the
NYSE, the American Stock Exchange, or the Nasdaq Stock Exchange.

 

7.14                        Transactions with Affiliates.

 

Borrowing and Holdings shall not enter into any transaction with any Affiliate
of Holdings or Borrower (other than a Subsidiary), except (a) as permitted by
this Agreement, (b) in the ordinary course of business and pursuant to the
reasonable requirements of the business of Holdings or Borrower, and in each
case of (a) and (b), upon fair and reasonable terms no less favorable to such
Person than would be obtainable in a comparable arm’s length transaction with a
Person not such an Affiliate, (c) transactions between or among Holdings or
Borrower and any of their Subsidiaries, (d) employment, compensation and
indemnification arrangements with officers and directors of Holdings, Borrower
and their Subsidiaries, (e) fees payable in connection with directors’ fees and
services rendered to the Board of Directors of Holdings, Borrower and their
Subsidiaries, or (f) loans and advances to officers and directors of Holdings,
Borrower and their Subsidiaries.

 

Section 8.              EVENTS OF DEFAULT

 

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

 

8.1                               Failure to Make Payments When Due.

 

Failure by Borrower to pay any installment of principal of any Loan when due,
whether at stated maturity, by acceleration, by notice of voluntary prepayment,
by mandatory prepayment or otherwise; failure by Borrower to pay when due any
amount payable to an Issuing Lender in reimbursement of any drawing under a
Letter of Credit; failure by Borrower to pay any interest on any Loan within
five days of the due date; or failure by Borrower to pay

 

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any fee or any other amount due under this Agreement or the other Loan Documents
within ten days after the date due; or

 

8.2                               Default in Other Agreements.

 

(i)            Failure of Holdings or any of its Subsidiaries to pay when due or
purchase, redeem or otherwise acquire or offer to purchase, redeem or otherwise
acquire any principal of or interest on or any other amount payable in respect
of one or more items of Indebtedness (other than Indebtedness referred to in
subsection 8.1) or Contingent Obligations having an aggregate principal amount
(including undrawn committed or available amounts and including amounts owing to
all creditors under any combined or syndicated credit agreement) of more than
$15,000,000 in the aggregate, in each case beyond the end of any grace period
provided therefor; or (ii) breach or default by Holdings or any of its
Subsidiaries with respect to any other material term of (a) one or more items of
Indebtedness or Contingent Obligations in the aggregate principal amounts
referred to in clause (i) above or (b) any loan agreement, mortgage, indenture
or other agreement relating to such item(s) of Indebtedness or Contingent
Obligation(s) in such amounts, if the effect of such breach or default is to
cause, or to permit the holder or holders of that Indebtedness or Contingent
Obligation(s) (or a trustee on behalf of such holder or holders) to cause, that
Indebtedness or Contingent Obligation(s) to become or be declared due and
payable prior to its stated maturity or the stated maturity of any underlying
obligation (upon the giving or receiving of notice, lapse of time, both, or
otherwise) or (iii) any event shall occur under the terms of any Senior Note
Documents, any Subordinated Indebtedness or any Refinancing Indebtedness, the
aggregate principal amount of which Senior Notes, Subordinated Indebtedness or
Refinancing Indebtedness exceeds $15,000,000, which shall require Holdings or
Borrower or any of their Subsidiaries to purchase, redeem or otherwise acquire
or offer to purchase, redeem or otherwise acquire all or any portion of such
Indebtedness of Holdings or Borrower except to the extent permitted by
subsection 7.5; or

 

8.3                               Breach of Certain Covenants.

 

Failure of Holdings or Borrower to perform or comply with any term or condition
contained in subsection 2.5 or 6.2 or Section 7 of this Agreement; or

 

8.4                               Breach of Warranty.

 

Any representation, warranty, certification or other statement made by Holdings
or any of its Subsidiaries in any Loan Document or in any statement or
certificate at any time given by Holdings or any of its Subsidiaries in writing
pursuant hereto or thereto or in connection herewith or therewith shall be false
in any material respect on the date as of which made; or

 

8.5                               Other Defaults Under Loan Documents.

 

Any Loan Party shall default in the performance of or compliance with any
material term contained in this Agreement or any of the other Loan Documents,
other than any such term referred to in any other subsection of this Section 8,
and such default shall not have been remedied or waived within 30 days after the
earlier of (i) an Executive Officer of Borrower or

 

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such Loan Party becoming aware of such default or (ii) receipt by Borrower and
such Loan Party of notice from Administrative Agent or any Lender of such
default; or

 

8.6                               Involuntary Bankruptcy; Appointment of
Receiver, etc.

 

(i)            A court having jurisdiction in the premises shall enter a decree
or order for relief in respect of Holdings or any of its Subsidiaries (other
than Immaterial Subsidiaries) in an involuntary case under the Bankruptcy Code
or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, which decree or order is not stayed; or any other similar
relief shall be granted under any applicable federal or state law; or (ii) an
involuntary case shall be commenced against Holdings or any of its Subsidiaries
(other than Immaterial Subsidiaries) under the Bankruptcy Code or under any
other applicable bankruptcy, insolvency or similar law now or hereafter in
effect; or a decree or order of a court having jurisdiction in the premises for
the appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over Holdings or any of its Subsidiaries
(other than Immaterial Subsidiaries), or over all or a substantial part of its
property, shall have been entered; or there shall have occurred the involuntary
appointment of an interim receiver, trustee or other custodian of Holdings or
any of its Subsidiaries (other than Immaterial Subsidiaries) for all or a
substantial part of its property; or a warrant of attachment, execution or
similar process shall have been issued against any substantial part of the
property of Holdings or any of its Subsidiaries (other than Immaterial
Subsidiaries), and any such event described in this clause (ii) shall continue
for 60 days unless dismissed, bonded or discharged; or

 

8.7                               Voluntary Bankruptcy; Appointment of Receiver,
etc.

 

(i)            Holdings or any of its Subsidiaries (other than Immaterial
Subsidiaries) shall have an order for relief entered with respect to it or
commence a voluntary case under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar law now or hereafter in effect, or
shall consent to the entry of an order for relief in an involuntary case, or to
the conversion of an involuntary case to a voluntary case, under any such law,
or shall consent to the appointment of or taking possession by a receiver,
trustee or other custodian for all or a substantial part of its property; or
Holdings or any of its Subsidiaries (other than Immaterial Subsidiaries) shall
make any assignment for the benefit of creditors; or (ii) Holdings or any of its
Subsidiaries (other than Immaterial Subsidiaries) shall be unable, or shall fail
generally, or shall admit in writing its inability, to pay its debts as such
debts become due; or the Board of Directors of Holdings or any of its
Subsidiaries (other than Immaterial Subsidiaries) (or any committee thereof)
shall adopt any resolution or otherwise authorize any action to approve any of
the actions referred to in clause (i) above or this clause (ii); or

 

8.8                               Judgments and Attachments.

 

Any money judgment, writ or warrant of attachment or similar process involving
in the aggregate at any time an amount in excess of $15,000,000 (in either case
not adequately covered by insurance as to which a Solvent and unaffiliated
insurance company has acknowledged coverage) shall be entered or filed against
Holdings or any of its Subsidiaries or any of their respective assets and shall
remain undischarged, unvacated, unbonded or unstayed

 

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for a period of 30 days (or in any event later than five days prior to the date
of any proposed sale thereunder); or

 

8.9                               Dissolution.

 

Any order, judgment or decree shall be entered against Holdings or any of its
Subsidiaries (other than Immaterial Subsidiaries) decreeing the dissolution or
split up of Holdings or that Subsidiary and such order shall remain undischarged
or unstayed for a period in excess of 60 days; or

 

8.10                        Employee Benefit Plans.

 

There shall occur one or more ERISA Events which individually or in the
aggregate results in or would reasonably be expected to result in liability of
Holdings or any of its Subsidiaries or any of their respective ERISA Affiliates
in excess of $10,000,000 during the term of this Agreement; or there shall exist
an amount of unfunded benefit liabilities (as defined in Section 4001(a)(18) of
ERISA), individually or in the aggregate for all Pension Plans (if any)
(excluding for purposes of such computation any Pension Plans (if any) with
respect to which assets exceed benefit liabilities), which exceeds $10,000,000;
or.

 

8.11                        Change in Control.

 

A Change in Control shall occur; or

 

8.12                        Invalidity of Subsidiary Guaranty; Failure of
Security; Repudiation of Obligations.

 

At any time after the execution and delivery thereof, (i) any Guaranty for any
reason other than the satisfaction in full of all Obligations, shall cease to be
in full force and effect (other than in accordance with their terms) or shall be
declared to be null and void, (ii) any Collateral Document shall cease to be in
full force and effect (other than by reason of a release of Collateral
thereunder in accordance with the terms hereof or thereof, the satisfaction in
full of the Obligations or any other termination of such Collateral Document in
accordance with the terms hereof or thereof) or shall be declared null and void,
or Administrative Agent shall not have or shall cease to have a valid and First
Priority Lien in any Collateral with a value in excess of $5,000,000 purported
to be covered thereby, in each case for any reason other than the failure of
Administrative Agent or any Lender to take any action within its control, or
(iii) any Loan Party shall contest the validity or enforceability of any Loan
Document in writing or deny in writing that it has any further liability,
including with respect to future advances by Lenders, under any Loan Document to
which it is a party; or

 

8.13                        Material Adverse Effect.

 

Any event or change shall occur that has caused or evidences, either in any case
or in the aggregate, a Material Adverse Effect;

 

THEN (i) upon the occurrence of any Event of Default described in subsection 8.6
or 8.7, each of (a) the unpaid principal amount of and accrued interest on the
Loans, (b) an amount

 

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equal to the maximum amount that may at any time be drawn under all Letters of
Credit then outstanding (whether or not any beneficiary under any such Letter of
Credit shall have presented, or shall be entitled at such time to present, the
drafts or other documents or certificates required to draw under such Letter of
Credit), and (c) all other Obligations shall automatically become immediately
due and payable, without presentment, demand, protest, notice of acceleration,
notice of intent to accelerate or other requirements of any kind, all of which
are hereby expressly waived by Borrower, and the obligation of each Lender to
make any Loan, the obligation of any Issuing Lender to issue any Letter of
Credit and the right of any Issuing Lender to issue any Letter of Credit
hereunder shall thereupon terminate, and (ii) upon the occurrence and during the
continuation of any other Event of Default, Administrative Agent shall, upon the
written request or with the written consent of Requisite Lenders, by written
notice to Borrower, declare all or any portion of the amounts described in
clauses (a) through (c) above to be, and the same shall forthwith become,
immediately due and payable, and the obligation of each Lender to make any Loan,
the obligation of any Issuing Lender to issue any Letter of Credit and the right
of any Issuing Lender to issue any Letter of Credit hereunder shall thereupon
terminate; provided that the foregoing shall not affect in any way the
obligations of Revolving Lenders under subsection 3.3C(i).

 

Section 9.              HOLDINGS GUARANTY

 

9.1                               Guaranty.

 

A.            In order to induce Lenders to extend credit to Borrower pursuant
to this Agreement, Holdings irrevocably and unconditionally guaranties, as
primary obligor and not merely as surety, the due and punctual payment in full
of all Guarantied Obligations (as hereinafter defined) when the same shall
become due, whether at stated maturity, by acceleration, demand or otherwise
(including amounts that would become due but for the operation of the automatic
stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a)).  The term
“Guarantied Obligations” is used herein in its most comprehensive sense and
includes any and all Obligations of Borrower and all obligations of Borrower
under Lender Hedge Agreements, now or hereafter made, incurred or created,
whether absolute or contingent, liquidated or unliquidated, whether due or not
due, and however arising under or in connection with this Agreement, the Lender
Hedge Agreements, and the other Loan Documents, including those arising under
successive borrowing transactions under this Agreement which shall either
continue such obligations of Borrower or from time to time renew them after they
have been satisfied.

 

Any interest on any portion of the Guarantied Obligations that accrues after the
commencement of any proceeding, voluntary or involuntary, involving the
bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement
of Borrower (or, if interest on any portion of the Guarantied Obligations ceases
to accrue by operation of law by reason of the commencement of said proceeding,
such interest as would have accrued on such portion of the Guarantied
Obligations if said proceeding had not been commenced) shall be included in the
Guarantied Obligations because it is the intention of Holdings and
Administrative Agent, as agent for and representative of Lenders (in such
capacity, “Guarantied Party”) that the Guarantied Obligations should be
determined without regard to

 

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any rule of law or order that may relieve Borrower of any portion of such
Guarantied Obligations.

 

In the event that all or any portion of the Guarantied Obligations is paid by
Borrower, the obligations of Holdings hereunder shall continue and remain in
full force and effect or be reinstated, as the case may be, in the event that
all or any part of such payment(s) is rescinded or recovered directly or
indirectly from Guarantied Party or Lenders (Guarantied Party and Lenders each
being a “Beneficiary” and collectively referred to herein as “Beneficiaries”) as
a preference, fraudulent transfer or otherwise, and any such payments that are
so rescinded or recovered shall constitute Guarantied Obligations.

 

Subject to the other provisions of this subsection 9.1, upon the failure of
Borrower to pay any of the Guarantied Obligations when and as the same shall
become due, Holdings will upon demand pay, or cause to be paid, in cash, to
Guarantied Party for the ratable benefit of Beneficiaries, an amount equal to
the aggregate of the unpaid Guarantied Obligations.

 

B.            Holdings, and each guarantor under other guaranties, if any,
relating to this Agreement (the “Related Guaranties”) that contain a
contribution provision similar to that set forth in this subsection 9.1B,
together desire to allocate among themselves (collectively, the “Contributing
Guarantors”), in a fair and equitable manner, their obligations arising under
this Section 9 and the Related Guaranties.  Accordingly, in the event any
payment or distribution is made on any date by Holdings under this Section 9 or
a guarantor under a Related Guaranty, Holdings or such other guarantor shall be
entitled to a contribution from each of the other Contributing Guarantors in the
maximum amount permitted by law so as to maximize the aggregate amount of the
Guarantied Obligations paid to Beneficiaries.

 

9.2                               Guaranty Absolute; Continuing Guaranty.

 

The obligations of Holdings hereunder are irrevocable, absolute, independent and
unconditional and shall not be affected by any circumstance which constitutes a
legal or equitable discharge of a guarantor or surety other than payment in full
of the Guarantied Obligations.  In furtherance of the foregoing and without
limiting the generality thereof, Holdings agrees that:  (a) this is a guaranty
of payment when due and not of collectibility; (b) Guarantied Party may enforce
this Section 9 upon the occurrence and during the continuance of an Event of
Default under this Agreement or the occurrence of an early termination date or
similar event under any Lender Hedge Agreements notwithstanding the existence of
any dispute between Borrower and any Beneficiary with respect to the existence
of such event; (c) the obligations of Holdings hereunder are independent of the
obligations of Borrower under the Loan Documents and the obligations of any
other guarantor of the obligations of Borrower and a separate action or actions
may be brought and prosecuted against Holdings whether or not any action is
brought against Borrower or any of such other guarantors and whether or not
Borrower is joined in any such action or actions; and (d) Holdings’ payment of a
portion, but not all, of the Guarantied Obligations shall in no way limit,
affect, modify or abridge Holdings’ liability for any portion of the Guarantied
Obligations that has not been paid.  This is a continuing guaranty and shall be
binding upon Holdings and its successors and assigns, and Holdings irrevocably
waives any right (including without limitation any such right arising

 

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under California Civil Code Section 2815) to revoke this Section 9 as to future
transactions giving rise to any Guarantied Obligations.

 

9.3                               Actions by Beneficiaries.

 

Any Beneficiary may from time to time, without notice or demand and without
affecting the validity or enforceability of this Section 9 or giving rise to any
limitation, impairment or discharge of Holdings’ liability hereunder, (a) renew,
extend, accelerate or otherwise change the time, place, manner or terms of
payment of the Guarantied Obligations, (b) settle, compromise, release or
discharge, or accept or refuse any offer of performance with respect to, or
substitutions for, the Guarantied Obligations or any agreement relating thereto
and/or subordinate the payment of the same to the payment of any other
obligations, (c) request and accept other guaranties of the Guarantied
Obligations and take and hold security for the payment of this Guaranty or the
Guarantied Obligations, (d) release, exchange, compromise, subordinate or
modify, with or without consideration, any security for payment of the
Guarantied Obligations, any other guaranties of the Guarantied Obligations, or
any other obligation of any Person with respect to the Guarantied Obligations,
(e) enforce and apply any security now or hereafter held by or for the benefit
of any Beneficiary in respect of this Section 9 or the Guarantied Obligations
and direct the order or manner of sale thereof, or exercise any other right or
remedy that Guarantied Party or the other Beneficiaries, or any of them, may
have against any such security, as Guarantied Party in its discretion may
determine consistent with this Agreement, the Lender Hedge Agreements and any
applicable security agreement, including foreclosure on any such security
pursuant to one or more judicial or nonjudicial sales, whether or not every
aspect of any such sale is commercially reasonable, and (f) exercise any other
rights available to Guarantied Party or the other Beneficiaries, or any of them,
under the Loan Documents or the Lender Hedge Agreements.

 

9.4                               No Discharge.

 

This Section 9 and the obligations of Holdings hereunder shall be valid and
enforceable and shall not be subject to any limitation, impairment or discharge
for any reason (other than payment in full of the Guarantied Obligations),
including without limitation the occurrence of any of the following, whether or
not Holdings shall have had notice or knowledge of any of them:  (a) any failure
to assert or enforce or agreement not to assert or enforce, or the stay or
enjoining, by order of court, by operation of law or otherwise, of the exercise
or enforcement of, any claim or demand or any right, power or remedy with
respect to the Guarantied Obligations or any agreement relating thereto, or with
respect to any other guaranty of or security for the payment of the Guarantied
Obligations, (b) any waiver or modification of, or any consent to departure
from, any of the terms or provisions of this Agreement, any of the other Loan
Documents, the Lender Hedge Agreements or any agreement or instrument executed
pursuant thereto, or of any other guaranty or security for the Guarantied
Obligations, (c) the Guarantied Obligations, or any agreement relating thereto,
at any time being found to be illegal, invalid or unenforceable in any respect,
(d) the application of payments received from any source to the payment of
indebtedness other than the Guarantied Obligations, even though Guarantied Party
or the other Beneficiaries, or any of them, might have elected to apply such
payment to any part or all of the Guarantied Obligations, (e) any failure to
perfect or continue perfection of a security interest in any

 

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collateral which any of the Guarantied Obligations, (f) any defenses, set-offs
or counterclaims which Borrower may assert against Guarantied Party or any
Beneficiary in respect of the Guarantied Obligations, including but not limited
to failure of consideration, breach of warranty, payment, statute of frauds,
statute of limitations, accord and satisfaction and usury, and (g) any other act
or thing or omission, or delay to do any other act or thing, which may or might
in any manner or to any extent vary the risk of Holdings as an obligor in
respect of the Guarantied Obligations.

 

9.5                               Waivers.

 

Holdings waives, for the benefit of Beneficiaries:  (a) any right to require
Guarantied Party or the other Beneficiaries, as a condition of payment or
performance by Holdings, to (i) proceed against Borrower, any other guarantor of
the Guarantied Obligations or any other Person, (ii) proceed against or exhaust
any security held from Borrower, any other guarantor of the Guarantied
Obligations or any other Person, (iii) proceed against or have resort to any
balance of any deposit account or credit on the books of any Beneficiary in
favor of Borrower or any other Person, or (iv) pursue any other remedy in the
power of any Beneficiary; (b) any defense arising by reason of the incapacity,
lack of authority or any disability or other defense of Borrower including,
without limitation, any defense based on or arising out of the lack of validity
or the unenforceability of the Guarantied Obligations or any agreement or
instrument relating thereto or by reason of the cessation of the liability of
Borrower from any cause other than payment in full of the Guarantied
Obligations; (c) any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in amount nor in
other respects more burdensome than that of the principal; (d) any defense based
upon Guarantied Party’s or any other Beneficiary’s errors or omissions in the
administration of the Guarantied Obligations, except behavior that amounts to
bad faith; (e) (i) any principles or provisions of law, statutory or otherwise,
that are or might be in conflict with the terms of this Guaranty and any legal
or equitable discharge of Holdings’ obligations hereunder, (ii) the benefit of
any statute of limitations affecting Holdings’ liability hereunder or the
enforcement hereof, (iii) any rights to set-offs, recoupments and counterclaims,
and (iv) promptness, diligence and any requirement that any Beneficiary protect,
secure, perfect or insure any Lien or any property subject thereto; (f) notices,
demands, presentments, protests, notices of protest, notices of dishonor and
notices of any action or inaction, including acceptance of this Agreement,
notices of default under this Agreement, notices of default or early termination
under any Lender Hedge Agreement or any agreement or instrument related thereto,
notices of acceleration and intent to accelerate, notices of any renewal,
extension or modification of the Guarantied Obligations or any agreement related
thereto, notices of any extension of credit to Borrower and notices of any of
the matters referred to in subsections 9.3 and 9.4 hereof and any right to
consent to any thereof; and (g) to the fullest extent permitted by law, any
defenses or benefits that may be derived from or afforded by law which limit the
liability of or exonerate guarantors or sureties, or which may conflict with the
terms of this Agreement.

 

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9.6                               Holdings’ Rights of Subrogation, Contribution,
Etc.; Subordination of Other Obligations.

 

Until payment in full of the Guarantied Obligations, Holdings waives (a) any
claim, right or remedy, direct or indirect, that Holdings now has or may
hereafter have against Borrower or any of its assets in connection with this
Agreement or the performance by Holdings of its obligations hereunder, in each
case whether such claim, right or remedy arises in equity, under contract, by
statute, under common law or otherwise and including without limitation (i) any
right of subrogation, reimbursement or indemnification that Holdings now has or
may hereafter have against Borrower, (ii) any right to enforce, or to
participate in, any claim, right or remedy that any Beneficiary now has or may
hereafter have against Borrower, and (iii) any benefit of, and any right to
participate in, any collateral or security now or hereafter held by any
Beneficiary and (b) any right of contribution Holdings may have against any
other guarantor of any of the Guarantied Obligations.  Holdings further agrees
that, to the extent the waiver of its rights of subrogation, reimbursement,
indemnification and contribution as set forth herein is found by a court of
competent jurisdiction to be void or voidable for any reason, any rights of
subrogation, reimbursement or indemnification Holdings may have against Borrower
or against any collateral or security, and any rights of contribution Holdings
may have against any such other guarantor, shall be junior and subordinate to
any rights Guarantied Party or the other Beneficiaries may have against
Borrower, to all right, title and interest Guarantied Party or the other
Beneficiaries may have in any such collateral or security, and to any right
Guarantied Party or the other Beneficiaries may have against such other
guarantor.

 

Any indebtedness of Borrower now or hereafter held by Holdings is subordinated
in right of payment to the Guarantied Obligations, and any such indebtedness of
Borrower to Holdings collected or received by Holdings after an Event of Default
has occurred and is continuing, and any amount paid to Holdings on account of
any subrogation, reimbursement, indemnification or contribution rights referred
to in the preceding paragraph when all Guarantied Obligations have not been paid
in full, shall be held in trust for Guarantied Party on behalf of Beneficiaries
and shall forthwith be paid over to Guarantied Party for the benefit of
Beneficiaries to be credited and applied against the Guarantied Obligations.

 

9.7                               Financial Condition of Borrower.

 

No Beneficiary shall have any obligation, and Holdings waives any duty on the
part of any Beneficiary, to disclose or discuss with Holdings its assessment, or
Holdings’ assessment, of the financial condition of Borrower or any matter or
fact relating to the business, operations or condition of Borrower.  Holdings
has adequate means to obtain information from Borrower on a continuing basis
concerning the financial condition of Borrower and its ability to perform its
obligations under the Loan Documents and the Lender Hedge Agreements, and
Holdings assumes the responsibility for being and keeping informed of the
financial condition of Borrower and of all circumstances bearing upon the risk
of nonpayment of the Guarantied Obligations.

 

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9.8                               Set Off.

 

In addition to any rights now or hereafter granted under applicable law and not
by way of limitation of any such rights, upon the occurrence of any Event of
Default each Beneficiary is hereby authorized by Holdings at any time or from
time to time, without notice to Holdings or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and to apply any
and all deposits or other amounts held by any Beneficiary for the credit or
account of Holdings (general or special, including indebtedness evidenced by
certificates of deposit, whether matured or unmatured, but not including trust
accounts) and any other indebtedness at any time held or owing by that
Beneficiary to or for the credit or the account of Holdings against and on
account of the Guarantied Obligations and liabilities of Holdings to any
Beneficiary under this Agreement, including all claims of any nature or
description arising out of or connected with this Agreement, irrespective of
whether or not (i) that Beneficiary shall have made any demand hereunder or (ii)
the principal of or the interest on the Loans or any amounts in respect of the
Letters of Credit or any other amounts due hereunder or under any of the other
Loan Documents shall have become due and payable pursuant to Section 8 and
although said Guarantied Obligations and liabilities, or any of them, may be
contingent or unmatured.  Holdings hereby further grants to each Beneficiary a
security interest in all deposits and accounts maintained with such Beneficiary
as security for the Guarantied Obligations.

 

9.9                               Notice of Lender Hedge Agreements.

 

Guarantied Party shall not be deemed to have any duty whatsoever with respect to
any Person who is a counterparty to a Lender Hedge Agreement until it shall have
received written notice in form and substance satisfactory to Guarantied Party
from Borrower, Holdings or such counterparty as to the existence and terms of
the applicable Lender Hedge Agreement.

 

Section 10.            ADMINISTRATIVE AGENT

 

10.1                        Appointment.

 

A.            Appointment of Administrative Agent.  CIBC is hereby appointed
Administrative Agent hereunder and under the other Loan Documents and each
Lender hereby authorizes Administrative Agent to act as its Administrative Agent
in accordance with the terms of this Agreement and the other Loan Documents. 
Administrative Agent agrees to act upon the express conditions contained in this
Agreement and the other Loan Documents, as applicable.  The provisions of this
Section 10 are solely for the benefit of Administrative Agent and Lenders and
Borrower and Holdings shall have no rights as third party beneficiaries of any
of the provisions thereof (other than pursuant to subsections 10.5 and 10.6). 
In performing its functions and duties under this Agreement, Administrative
Agent shall act solely as an Administrative Agent of Lenders and does not assume
and shall not be deemed to have assumed any obligation towards or relationship
of agency or trust with or for Holdings or any of its Subsidiaries.

 

B.            Appointment of Supplemental Collateral Agents.  It is the purpose
of this Agreement and the other Loan Documents that there shall be no violation
of any law of any

 

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jurisdiction denying or restricting the right of banking corporations or
associations to transact business as Administrative Agent or trustee in such
jurisdiction.  It is recognized that in case of litigation under this Agreement
or any of the other Loan Documents, and in particular in case of the enforcement
of any of the Loan Documents, or in case Administrative Agent deems that by
reason of any present or future law of any jurisdiction it may not exercise any
of the rights, powers or remedies granted herein or in any of the other Loan
Documents or take any other action which may be desirable or necessary in
connection therewith, it may be necessary that Administrative Agent appoint an
additional individual or institution as a separate trustee, co-trustee,
Collateral Agent or collateral co-Administrative Agent (any such additional
individual or institution being referred to herein individually as a
“Supplemental Collateral Agent” and collectively as “Supplemental Collateral
Agents”).

 

In the event that Administrative Agent appoints a Supplemental Collateral Agent
with respect to any Collateral, (i) each and every right, power, privilege or
duty expressed or intended by this Agreement or any of the other Loan Documents
to be exercised by or vested in or conveyed to Administrative Agent with respect
to such Collateral shall be exercisable by and vest in such Supplemental
Collateral Agent to the extent, and only to the extent, necessary to enable such
Supplemental Collateral Agent to exercise such rights, powers and privileges
with respect to such Collateral and to perform such duties with respect to such
Collateral, and every covenant and obligation contained in the Loan Documents
and necessary to the exercise or performance thereof by such Supplemental
Collateral Agent shall run to and be enforceable by either Administrative Agent
or such Supplemental Collateral Agent, and (ii) the provisions of this Section
10 and of subsections 11.2 and 11.3 that refer to Administrative Agent shall
inure to the benefit of such Supplemental Collateral Agent and all references
therein to Administrative Agent shall be deemed to be references to
Administrative Agent and/or such Supplemental Collateral Agent, as the context
may require.

 

Should any instrument in writing from Borrower or any other Loan Party be
required by any Supplemental Collateral Agent so appointed by Administrative
Agent for more fully and certainly vesting in and confirming to him or it such
rights, powers, privileges and duties, Borrower shall, or shall cause such Loan
Party to, execute, acknowledge and deliver any and all such instruments promptly
upon request by Administrative Agent.  In case any Supplemental Collateral
Agent, or a successor thereto, shall die, become incapable of acting, resign or
be removed, all the rights, powers, privileges and duties of such Supplemental
Collateral Agent, to the extent permitted by law, shall vest in and be exercised
by Administrative Agent until the appointment of a new Supplemental Collateral
Agent.

 

10.2                        Powers and Duties; General Immunity.

 

A.            Powers; Duties Specified.  Each Lender irrevocably authorizes
Administrative Agent to take such action on such Lender’s behalf and to exercise
such powers, rights and remedies hereunder and under the other Loan Documents as
are specifically delegated or granted to Administrative Agent by the terms
hereof and thereof, together with such powers, rights and remedies as are
reasonably incidental thereto.  Administrative Agent shall have only those
duties and responsibilities that are expressly specified in this Agreement and
the other Loan Documents.  Administrative Agent may exercise such powers, rights
and remedies and perform such duties by or through its Administrative Agents or
employees.  Administrative

 

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Agent shall not have, by reason of this Agreement or any of the other Loan
Documents, a fiduciary relationship in respect of any Lender; and nothing in
this Agreement or any of the other Loan Documents, expressed or implied, is
intended to or shall be so construed as to impose upon Administrative Agent any
obligations in respect of this Agreement or any of the other Loan Documents
except as expressly set forth herein or therein.

 

B.            No Responsibility for Certain Matters.  Administrative Agent shall
not be responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Agreement or any
other Loan Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statements or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by Administrative Agent to Lenders or by
or on behalf of Holdings or Borrower to Administrative Agent or any Lender in
connection with the Loan Documents and the transactions contemplated thereby or
for the financial condition or business affairs of Holdings or Borrower or any
other Person liable for the payment of any Obligations, nor shall Administrative
Agent be required to ascertain or inquire as to the performance or observance of
any of the terms, conditions, provisions, covenants or agreements contained in
any of the Loan Documents or as to the use of the proceeds of the Loans the use
of the Letters of Credit or as to the existence or possible existence of any
Event of Default or Potential Event of Default.  Anything contained in this
Agreement to the contrary notwithstanding, Administrative Agent shall not have
any liability arising from confirmations of the amount of outstanding Loans or
the Letter of Credit Usage or the component amounts thereof.

 

C.            Exculpatory Provisions.  Neither Administrative Agent nor any of
its officers, directors, employees or Administrative Agents shall be liable to
Lenders for any action taken or omitted by Administrative Agent under or in
connection with any of the Loan Documents except to the extent caused by
Administrative Agent’s gross negligence or willful misconduct.  Administrative
Agent shall be entitled to refrain from any act or the taking of any action
(including the failure to take an action) in connection with this Agreement or
any of the other Loan Documents or from the exercise of any power, discretion or
authority vested in it hereunder or thereunder unless and until Administrative
Agent shall have received instructions in respect thereof from Requisite Lenders
(or such other Lenders as may be required to give such instructions under
subsection 11.6) and, upon receipt of such instructions from Requisite Lenders
(or such other Lenders, as the case may be), Administrative Agent shall be
entitled to act or (where so instructed) refrain from acting, or to exercise
such power, discretion or authority, in accordance with such instructions. 
Without prejudice to the generality of the foregoing, (i) Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper Person or Persons, and shall be
entitled to rely and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for the Loan Parties), accountants, experts and
other professional advisors selected by it; and (ii) no Lender shall have any
right of action whatsoever against Administrative Agent as a result of
Administrative Agent acting or (where so instructed) refraining from acting
under this Agreement or any of the other Loan Documents in accordance with the
instructions of Requisite Lenders (or such other Lenders as may be required to
give such instructions under subsection 11.6).

 

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D.            Administrative Agent Entitled to Act as Lender.  The agency hereby
created shall in no way impair or affect any of the rights and powers of, or
impose any duties or obligations upon, Administrative Agent in its individual
capacity as a Lender hereunder.  With respect to its participation in the Loans
and the Letters of Credit, Administrative Agent shall have the same rights and
powers hereunder as any other Lender and may exercise the same as though it were
not performing the duties and functions delegated to it hereunder, and the term
“Lender” or “Lenders” or any similar term shall, unless the context clearly
otherwise indicates, include Administrative Agent in its individual capacity. 
Administrative Agent and its Affiliates may accept deposits from, lend money to
and generally engage in any kind of banking, trust, financial advisory or other
business with Holdings, Borrower or any of their Affiliates as if it were not
performing the duties specified herein, and may accept fees and other
consideration from Borrower for services in connection with this Agreement and
otherwise without having to account for the same to Lenders.

 

10.3                        Representations and Warranties; No Responsibility
For Appraisal of Creditworthiness.

 

Each Lender represents and warrants that it has made its own independent
investigation of the financial condition and affairs of Holdings, Borrower and
their Subsidiaries in connection with the making of the Loans hereunder and that
it has made and shall continue to make its own appraisal of the creditworthiness
of Holdings, Borrower and their Subsidiaries.  Administrative Agent shall not
have any duty or responsibility, either initially or on a continuing basis, to
make any such investigation or any such appraisal on behalf of Lenders or to
provide any Lender with any credit or other information with respect thereto,
whether coming into its possession before the making of the Loans or at any time
or times thereafter, and Administrative Agent shall not have any responsibility
with respect to the accuracy of or the completeness of any information provided
to Lenders.

 

10.4                        Right to Indemnity.

 

Each Lender, in proportion to its Pro Rata Share, severally agrees to indemnify
Administrative Agent, to the extent that Administrative Agent shall not have
been reimbursed by Holdings or Borrower, for and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including counsel fees and disbursements) or disbursements of
any kind or nature whatsoever which may be imposed on, incurred by or asserted
against Administrative Agent in exercising its powers, rights and remedies or
performing its duties hereunder or under the other Loan Documents or otherwise
in its capacity as Administrative Agent in any way relating to or arising out of
this Agreement or the other Loan Documents; provided 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 Administrative Agent’s gross negligence or willful misconduct.  If any
indemnity furnished to Administrative Agent for any purpose shall, in the
opinion of Administrative Agent, be insufficient or become impaired,
Administrative Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished.

 

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10.5                        Successor Administrative Agent.

 

Administrative Agent may resign at any time by giving 30 days’ prior written
notice thereof to Lenders and Borrower, and Administrative Agent may be removed
at any time with or without cause by an instrument or concurrent instruments in
writing delivered to Borrower and Administrative Agent and signed by Requisite
Lenders.  Upon any such notice of resignation or any such removal, Requisite
Lenders shall have the right, upon five Business Days’ notice to Borrower, to
appoint a successor Administrative Agent with the consent of Borrower which
shall not be unreasonably withheld and shall not be required after the
occurrence of a Potential Event of Default or an Event of Default.  Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, that successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring or removed Administrative Agent and the retiring or removed
Administrative Agent shall be discharged from its duties and obligations under
this Agreement.  After any retiring or removed Administrative Agent’s
resignation or removal hereunder as Administrative Agent, the provisions of this
Section 10 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Agreement.

 

10.6                        Collateral Documents and Guaranties.

 

Each Lender hereby further authorizes Administrative Agent, on behalf of and for
the benefit of Lenders, to enter into each Collateral Document as secured party
and to be Administrative Agent for and representative of Lenders under the
Guaranties, and each Lender agrees to be bound by the terms of each Collateral
Document and the Guaranties; provided that Administrative Agent shall not (i)
enter into or consent to any material amendment, modification, termination or
waiver of any provision contained in any Collateral Document or the Guaranties
or (ii) release any Collateral (except as otherwise expressly permitted or
required pursuant to the terms of this Agreement or the applicable Collateral
Document), in each case without the prior consent of Requisite Lenders (or, if
required pursuant to subsection 11.6, all Lenders); provided further, however,
that, without further written consent or authorization from Lenders,
Administrative Agent may execute any documents or instruments necessary to
(a) release any Lien encumbering any item of Collateral that is the subject of a
sale or other disposition of assets permitted by this Agreement or to which
Requisite Lenders have otherwise consented or (b) release any Subsidiary
Guarantor from the Subsidiary Guaranty if all of the capital stock of such
Subsidiary Guarantor is sold to any Person (other than an Affiliate of Holdings
or Borrower) pursuant to a sale or other disposition permitted hereunder or to
which Requisite Lenders have otherwise consented.  Anything contained in any of
the Loan Documents to the contrary notwithstanding, Holdings, Borrower,
Administrative Agent and each Lender hereby agree that (X) no Lender shall have
any right individually to realize upon any of the Collateral under any
Collateral Document or to enforce any Guaranty, it being understood and agreed
that all powers, rights and remedies under the Collateral Documents and the
Guaranties may be exercised solely by Administrative Agent for the benefit of
Lenders in accordance with the terms thereof, and (Y) in the event of a
foreclosure by Administrative Agent on any of the Collateral pursuant to a
public or private sale, Administrative Agent or any Lender may be the purchaser
of any or all of such Collateral at any such sale and Administrative Agent, as
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Lenders (but not any Lender or Lenders in its or their respective individual
capacities unless Requisite Lenders shall otherwise agree in writing) shall be
entitled, for the purpose of bidding and making settlement or payment of the
purchase price for all or any portion of the Collateral sold at any such public
sale, to use and apply any of the Obligations as a credit on account of the
purchase price for any Collateral payable by Administrative Agent at such sale.

 

Section 11.            MISCELLANEOUS

 

11.1                        Assignments and Participations in Loans.

 

A.            General.  Subject to subsections 11.1B and 11.1C, each Lender
shall have the right at any time to (i) sell, assign or transfer to any Eligible
Assignee, or (ii) sell participations to any Person in, all or any part of its
Commitments or any Loan or Loans made by it or its Letters of Credit or
participations therein or any other interest herein or in any other Obligations
owed to it; provided that no such sale, assignment, transfer or participation
shall, without the consent of Borrower, require Borrower to file a registration
statement with the Securities and Exchange Commission or apply to qualify such
sale, assignment, transfer or participation under the securities laws of any
state; provided, further, that no such sale, assignment or transfer described in
clause (i) above shall be effective unless and until an Assignment Agreement
effecting such sale, assignment or transfer shall have been accepted by
Administrative Agent and recorded in the Register as provided in subsection
11.1B(ii); provided, further, that no such sale, assignment, transfer or
participation of any Letter of Credit or any participation therein may be made
separately from a sale, assignment, transfer or participation of a corresponding
interest in the Revolving Loan Commitment and the Revolving Loans of the Lender
effecting such sale, assignment, transfer or participation.  Except as otherwise
provided in this subsection 11.1, no Lender shall, as between Borrower and such
Lender, be relieved of any of its obligations hereunder as a result of any sale,
assignment or transfer of, or any granting of participations in, all or any part
of its Commitments or the Loans, or participations therein, or the other
Obligations owed to such Lender, and such Lender shall remain solely responsible
for the performance of such Obligations, and Borrower shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.

 

B.            Assignments.

 

(i)            Amounts and Terms of Assignments.  Each Commitment, Loan, Letter
of Credit or participation therein, or other Obligation may (a) be assigned in
any amount to another Lender, or to an Affiliate or Approved Fund of the
assigning Lender or another Lender, with the giving of notice to Borrower and
Administrative Agent or (b) be assigned in an aggregate amount of not less than
$1,000,000, in the case of any assignment of a Revolving Loan or Revolving Loan
Commitment, or $1,000,000, in the case of any assignment of a Letter of Credit
(or such lesser amount as shall constitute the aggregate amount of the
Commitments, Loans, Letters of Credit and participations therein, and other
Obligations of the assigning Lender) to any other Eligible Assignee (treating
any two or more Approved Funds with the same investment advisor as a single
Eligible Assignee) with the giving of notice to Borrower and with the consent of
Borrower (unless a Potential Event of Default or an Event of Default has

 

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occurred and is continuing) and Administrative Agent (which consent of Borrower
and Administrative Agent shall not be unreasonably withheld or delayed).  To the
extent of any such assignment in accordance with either clause (a) or (b) above,
the assigning Lender shall be relieved of its obligations with respect to its
Commitments, Loans, Letters of Credit or participations therein, or other
Obligations or the portion thereof so assigned.  The parties to each such
assignment shall execute and deliver to Administrative Agent, for its acceptance
and recording in the Register, an Assignment Agreement, together with a
processing and recordation fee of $3,500 (except that no such registration and
processing fee shall be payable in the case of an Assignee which is an Affiliate
of the Assignor or a Person under common management with the Assignor), and such
forms (including an administrative questionnaire if the Eligible Assignee is not
a Lender), certificates or other evidence, if any, with respect to United States
federal income tax withholding matters as the assignee under such Assignment
Agreement may be required to deliver to Administrative Agent pursuant to
subsection 2.7B(iii)(a).  Upon such execution, delivery, acceptance and
recordation, from and after the effective date specified in such Assignment
Agreement, (y) the assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment Agreement, shall have the rights and obligations of a Lender
hereunder, and (z) the assigning Lender thereunder shall, to the extent that
rights and obligations hereunder have been assigned by it pursuant to such
Assignment Agreement, relinquish its rights (other than any rights which survive
the termination of this Agreement under subsection 11.9B) and be released from
its obligations under this Agreement (and, in the case of an Assignment
Agreement 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; provided that, anything contained in any of the Loan Documents to the
contrary notwithstanding, if such Lender is the Issuing Lender with respect to
any outstanding Letters of Credit such Lender shall continue to have all rights
and obligations of an Issuing Lender with respect to such Letters of Credit
until the cancellation or expiration of such Letters of Credit and the
reimbursement of any amounts drawn thereunder).  The Commitments hereunder shall
be modified to reflect the Commitment of such assignee and any remaining
Commitment of such assigning Lender and, if any such assignment occurs after the
issuance of any Notes hereunder, the assigning Lender shall, upon the
effectiveness of such assignment or as promptly thereafter as practicable,
surrender its applicable Notes, if any, to Administrative Agent for
cancellation, and thereupon new Notes shall, if so requested by the assignee
and/or the assigning Lender in accordance with subsection 2.1D, be issued to the
assignee and/or to the assigning Lender, substantially in the form of Exhibit V
annexed hereto with appropriate insertions, to reflect the new Commitments, of
the assignee and/or the assigning Lender.  Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with
this subsection 11.1B shall be treated for purposes of this Agreement as a sale
by such Lender of a participation in such rights and obligations in accordance
with subsection 11.1C.

 

(ii)           Acceptance by Administrative Agent; Recordation in Register. 
Upon its receipt of an Assignment Agreement executed by an assigning Lender and
an assignee representing that it is an Eligible Assignee, together with the
processing and

 

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recordation fee referred to in subsection 11.1B(i) and any forms, certificates
or other evidence with respect to United States federal income tax withholding
matters that such assignee may be required to deliver to Administrative Agent
pursuant to subsection 2.7B(iii)(a), Administrative Agent shall, if
Administrative Agent (and if necessary, Borrower) has consented to the
assignment evidenced thereby (in each case to the extent such consent is
required pursuant to subsection 11.1B(i)), (a) accept such Assignment Agreement
by executing a counterpart thereof as provided therein (which acceptance shall
evidence any required consent of Administrative Agent to such assignment), (b)
record the information contained therein in the Register, and (c) give prompt
notice thereof to Borrower.  Administrative Agent shall maintain a copy of each
Assignment Agreement delivered to and accepted by it as provided in this
subsection 11.1B(ii).

 

C.            Participations.  Any Lender may, without the consent of, or notice
to, Borrower or Administrative Agent, sell participations to one or more banks
or other entities (a “Participant”) in all or a portion of such Lender’s rights
and/or obligations under this Agreement (including all or a portion of its
Commitment and/or the Loans owing to it); provided that (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, and (iii) Borrower, Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender’s rights and obligations under this Agreement.  Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce the Loan Documents and
to approve any amendment, modification or waiver of any provision of the Loan
Documents; provided that such agreement or instrument may provide that such
Lender will not, without the consent of such Participant, agree to any
amendment, modification or waiver that affects such Participant if such
amendment, modification or waiver requires the unanimous written consent of all
Lenders pursuant to subsection 11.6.  Subject to subsection 11.1D, Borrower
agrees that each Participant shall be entitled to the benefits of subsections
2.6D, 2.7, and 3.6 to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to this subsection 11.1C; provided, however,
that in no event shall Borrower be obligated to make any payment with respect to
such subsections which is greater than the amount that Borrower would have paid
to the Lender had no such participation been sold.  To the extent permitted by
law, in the event that any amounts outstanding under this Agreement are due and
unpaid, or shall have been declared or shall have become due and payable upon
the occurrence of an Event of Default, each Participant shall be deemed to have
the right of set-off in respect of its participating interest in amounts owing
under this Agreement to the same extent as if the amount of its participating
interest were owing directly to it as a Lender under this Agreement.

 

D.            A Participant shall not be entitled to receive any greater payment
under subsections 2.6D, 2.7, and 3.6 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with Borrower’s
prior written consent.  A Participant that would be a Non-US Lender if it were a
Lender shall not be entitled to the benefits of subsection 2.7 unless Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of Borrower, to comply with subsection 2.7B(iii) as
though it were a Lender.

 

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E.             Assignments to Secured Parties and Trustees.  In addition to the
assignments and participations permitted under the foregoing provisions of this
subsection 11.1, (a) any Lender may assign and pledge all or any portion of its
Loans, the other Obligations owed to such Lender, and its Notes to any creditor,
including Federal Reserve Bank, as collateral security pursuant to Regulation A
of the Board of Governors of the Federal Reserve System and any operating
circular issued by such Federal Reserve Bank; provided that (i) no Lender shall,
as between Borrower and such Lender, be relieved of any of its obligations
hereunder as a result of any such assignment and pledge and (ii) in no event
shall such creditor be considered to be a “Lender” or be entitled to require the
assigning Lender to take or omit to take any action hereunder, and (b) any
Lender which is a Fund may pledge its Notes to its trustee for the benefit of
the Fund’s investors.

 

F.             Information.  Each Lender may furnish any information concerning
Holdings and its Subsidiaries in the possession of that Lender from time to time
to assignees and participants (including prospective assignees and
participants), subject to subsection 11.19.

 

G.            Representations of Lenders.  Each Lender which is the recipient of
an Allocation Letter and a party to this Agreement hereby represents and
warrants (i) that it is an Eligible Assignee; (ii) that it has experience and
expertise in the making of loans such as the Loans; and (iii) that it will make
its Loans for its own account in the ordinary course of its business and without
a view to distribution of such Loans within the meaning of the Securities Act or
the Exchange Act or other federal securities laws (it being understood that,
subject to the provisions of this subsection 11.1, the disposition of such Loans
or any interests therein shall at all times remain within its exclusive
control).  Each Lender that becomes a party hereto pursuant to an Assignment
Agreement shall be deemed to agree that the representations and warranties of
such Lender contained in Section 2(c) of such Assignment Agreement are
incorporated herein by this reference.

 

11.2                        Expenses.

 

Whether or not the transactions contemplated hereby shall be consummated,
Borrower agrees to pay promptly (i) all the actual and reasonable costs and
expenses of preparation of the Loan Documents and any consents, amendments,
waivers or other modifications thereto; (ii) all the costs of furnishing all
opinions by counsel for the Loan Parties (including any opinions requested by
Lenders as to any legal matters arising hereunder) and of Holdings’ and
Borrower’s performance of and compliance with all agreements and conditions on
their part to be performed or complied with under this Agreement and the other
Loan Documents including with respect to confirming compliance with
environmental, insurance and solvency requirements; (iii) the reasonable fees,
expenses and disbursements of counsel to Administrative Agent in connection with
the negotiation, preparation, execution and administration of the Loan Documents
and any consents, amendments, waivers or other modifications thereto and any
other documents or matters requested by Borrower; (iv) all the actual and
reasonable costs and expenses of creating and perfecting Liens in favor of
Administrative Agent on behalf of Lenders pursuant to any Collateral Document
prior to and after the Effective Date, including filing fees, search fees, and
reasonable fees, expenses and disbursements of counsel to Administrative Agent
and of counsel providing any opinions that Administrative Agent or Requisite
Lenders may reasonably request in respect of the Collateral

 

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Documents or the Liens created pursuant thereto; (v) the custody or preservation
of any of the Collateral; (vi) all other actual and reasonable costs and
expenses incurred by Administrative Agent in connection with the syndication of
the Commitments and the negotiation, preparation and execution of the Loan
Documents and any consents, amendments, waivers or other modifications thereto
and the transactions contemplated thereby; and (vii) after the occurrence of an
Event of Default, all costs and expenses, including reasonable attorneys’ fees
(including allocated costs of internal counsel) and costs of settlement,
incurred by Administrative Agent and Lenders in enforcing any Obligations of or
in collecting any payments due from any Loan Party hereunder or under the other
Loan Documents by reason of such Event of Default (including in connection with
the sale of, collection from, or other realization upon any of the Collateral or
the enforcement of any Guaranty) or in connection with any refinancing or
restructuring of the credit arrangements provided under this Agreement in the
nature of a “work-out” or pursuant to any insolvency or bankruptcy proceedings.

 

11.3                        Indemnity.

 

In addition to the payment of expenses pursuant to subsection 11.2, whether or
not the transactions contemplated hereby shall be consummated, Borrower agrees
to defend (subject to Indemnitees’ selection of counsel), indemnify, pay and
hold harmless Administrative Agent, Lenders and each Issuing Lender in
accordance with subsection 3.5, and the officers, directors, employees, counsel,
agents, representatives, advisors and affiliates of Administrative Agent,
Lenders and Issuing Lenders (collectively called the “Indemnitees”), from and
against any and all Indemnified Liabilities (as hereinafter defined).

 

The foregoing indemnification shall apply whether or not such Indemnified
Liabilities are in any way or to any extent owed, in whole or in part, under any
claim or theory of strict liability, or are caused, in whole or in part, by any
negligent act or omission of any kind by any Indemnitee; provided that Borrower
shall not have any obligation to any Indemnitee hereunder with respect to (i)
any Indemnified Liabilities to the extent such Indemnified Liabilities arise
solely from the gross negligence or willful misconduct of that Indemnitee as
determined by a final judgment of a court of competent jurisdiction and (ii)
disputes solely between Indemnitees which do not arise out of or as a result of
any such Indemnified Liabilities.

 

As used herein, “Indemnified Liabilities” means, collectively, any and all
liabilities, obligations, losses, damages (including natural resource damages),
penalties, actions, judgments, suits, claims (including Environmental Claims),
costs (including the costs of any investigation, study, sampling, testing,
abatement, cleanup, removal, remediation or other response action necessary to
remove, remediate, clean up or abate any Hazardous Materials Activity), expenses
and disbursements of any kind or nature whatsoever (including the reasonable
fees and disbursements of counsel for Indemnitees in connection with any
investigative, administrative or judicial proceeding commenced or threatened by
any Person, whether or not any such Indemnitee shall be designated as a party or
a potential party thereto, and any fees or expenses incurred by Indemnitees in
enforcing this indemnity), whether direct and whether based on any federal,
state or

 

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foreign laws, statutes, rules or regulations (including securities and
commercial laws, statutes, rules or regulations and Environmental Laws), on
common law or equitable cause or on contract or otherwise, that may be imposed
on, incurred by, or asserted against any such Indemnitee, in any manner relating
to or arising out of (i) this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby (including Lenders’ agreement to
make the Loans hereunder or the use or intended use of the proceeds thereof or
the issuance of Letters of Credit hereunder or the use or intended use of any
thereof, or any enforcement of any of the Loan Documents (including any sale of,
collection from, or other realization upon any of the Collateral or the
enforcement of any Guaranty), (ii) the statements contained in the commitment
letter delivered by any Lender to Borrower and Holdings with respect thereto, or
(iii) any Environmental Claim or any Hazardous Materials Activity relating to or
arising from, directly or indirectly, any past or present activity, operation,
land ownership, or practice of Holdings or any of its Subsidiaries.

 

To the extent that the undertakings to defend, indemnify, pay and hold harmless
set forth in this subsection 11.3 may be unenforceable in whole or in part
because they are violative of any law or public policy, Borrower shall
contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities
incurred by Indemnitees or any of them.

 

11.4                        Set-Off.

 

In addition to any rights now or hereafter granted under applicable law and not
by way of limitation of any such rights, upon the occurrence of any Event of
Default each Lender is hereby authorized by Borrower at any time or from time to
time, without notice to Borrower or to any other Person, any such notice being
hereby expressly waived, to set off and to appropriate and to apply any and all
deposits or other amounts held by any Lender for the credit or account of
Borrower (general or special, including Indebtedness evidenced by certificates
of deposit, whether matured or unmatured, but not including trust accounts) and
any other Indebtedness at any time held or owing by that Lender to or for the
credit or the account of Borrower against and on account of the obligations and
liabilities of Borrower to that Lender under this Agreement, the Letters of
Credit and participations therein and the other Loan Documents, including all
claims of any nature or description arising out of or connected with this
Agreement, the Letters of Credit and participations therein or any other Loan
Document, irrespective of whether or not (i) that Lender shall have made any
demand hereunder or (ii) the principal of or the interest on the Loans or any
amounts in respect of the Letters of Credit or any other amounts due hereunder
or under any of the other Loan Documents shall have become due and payable
pursuant to Section 8 and although said obligations and liabilities, or any of
them, may be contingent or unmatured.  Borrower hereby further grants to
Administrative Agent and each Lender a security interest in all deposits and
accounts maintained with Administrative Agent or such Lender as security for the
Obligations.

 

11.5                        Ratable Sharing.

 

Lenders hereby agree among themselves that if any of them shall, whether by
voluntary payment (other than a voluntary prepayment of Loans made and applied
in

 

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accordance with the terms of this Agreement), by realization upon security,
through the exercise of any right of set-off or banker’s lien, by counterclaim
or cross action or by the enforcement of any right under the Loan Documents or
otherwise, or as adequate protection of a deposit treated as cash collateral
under the Bankruptcy Code, receive payment or reduction of a proportion of the
aggregate amount of principal, interest, amounts payable in respect of Letters
of Credit, fees and other amounts then due and owing to that Lender hereunder or
under the other Loan Documents (collectively, the “Aggregate Amounts Due” to
such Lender) that is greater than the proportion received by any other Lender in
respect of the Aggregate Amounts Due to such other Lender, then the Lender
receiving such proportionately greater payment shall (i) notify Administrative
Agent and each other Lender of the receipt of such payment and (ii) apply a
portion of such payment to purchase participations (which it shall be deemed to
have purchased from each seller of a participation simultaneously upon the
receipt by such seller of its portion of such payment) in the Aggregate Amounts
Due to the other Lenders so that all such recoveries of Aggregate Amounts Due
shall be shared by all Lenders in proportion to the Aggregate Amounts Due to
them; provided that if all or part of such proportionately greater payment
received by such purchasing Lender is thereafter recovered from such Lender upon
the bankruptcy or reorganization of Borrower or otherwise (and whether by
litigation, demand, settlement or otherwise), those purchases shall be rescinded
and the purchase prices paid for such participations shall be returned to such
purchasing Lender ratably to the extent of such recovery, but without interest. 
Borrower expressly consents to the foregoing arrangement and agrees that any
holder of a participation so purchased may exercise any and all rights of
banker’s lien, set-off or counterclaim with respect to any and all monies owing
by Borrower to that holder with respect thereto as fully as if that holder were
owed the amount of the participation held by that holder.

 

11.6                        Amendments and Waivers.

 

No amendment, modification, termination or waiver of any provision of this
Agreement or of the Notes or of any of the other Loan Documents, and no consent
to any departure by any Loan Party herefrom or therefrom, shall in any event be
effective without the written concurrence of Requisite Lenders; provided that in
addition,

 

(a)           any such amendment, modification, termination, waiver or consent
which:

 

(i)            postpones the date or reduces the amount of any scheduled payment
(but not prepayment) of principal of any of the Loans;

 

(ii)           postpones the date on which any interest or any fees are payable
or reduces the amount of any fees payable hereunder;

 

(iii)          amends, modifies, terminates or waives any provision of
subsection 2.2 which decreases the interest rate borne by Loans (other than any
waiver of any increase in the interest rate applicable to such Loans pursuant to
subsection 2.2E) or the percentages set forth in the definitions of “Applicable
Base Rate Margin” and “Applicable LIBOR Margin”;

 

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(iv)          changes in any manner the definition of “Pro Rata Share” or the
definition of “Requisite Lenders”;

 

(v)           changes in any manner any provision of this Agreement which, by
its terms, expressly requires the approval or concurrence of all Lenders;

 

(vi)          releases any Lien granted in favor of Administrative Agent with
respect to all or substantially all of the Collateral;

 

(vii)         releases from their obligations under the Subsidiary Guaranty,
Subsidiary Guarantors which individually or in the aggregate own assets with an
aggregate value for such Subsidiary Guarantors on such release dates, as
reasonably determined by Administrative Agent, in excess of 50% of the total
value of the assets owned by Holdings and its Subsidiaries on September 30,
2003, in each case other than those releases not requiring a vote of the Lenders
in accordance with the terms of the Loan Documents (each released Subsidiary
Guarantor shall be referred to as a “Released Guarantor” if the release of such
Person’s obligations under a Subsidiary Guaranty is not evidenced by the written
concurrence of all Lenders);

 

(viii)        releases Holdings from its obligations under Section 9 of this
Agreement other than in accordance with the terms of this Agreement;

 

(ix)           waives or changes in any manner the provisions contained in
subsection 8.1 or this subsection 11.6,

 

shall be effective only if evidenced by the written concurrence of all Lenders
affected thereby; provided, however, that with respect to clause (vii) above
only the written concurrence of all Lenders minus one shall be required (if such
one Lender by itself constitutes Requisite Lenders, then its concurrence shall
also be required); provided, further, however, with respect to any such Released
Guarantor, (i) stock of such Released Guarantor may be subjected to Liens only
as and to the extent such Liens would have been permitted under subsection 7.2
with respect to a Subsidiary Guarantor (or other provisions or schedule
incorporated in such subsection and as applied in such subsection) as in effect
on the Effective Date and (ii) such Released Guarantor shall be permitted to
enter into Contingent Obligations only as and to the extent any such Contingent
Obligations would have been permitted under subsection 7.4 with respect to a
Subsidiary Guarantor (or other provisions or schedule incorporated in such
subsection and as applied in such subsection) as in effect on the Effective
Date; provided, further, however, that any amendment, modification, termination
or waiver to subsection 7.2 or subsection 7.4 (or other provisions or schedule
incorporated in either of such subsections and as applied therein) which has the
effect of increasing (x) the Liens to which stock of a Released Guarantor could
be subject or (y) the amount or nature of Contingent Obligations permitted to be
entered into by a Released Guarantor, as applicable, shall only apply to such
Released Guarantors if such amendment, modification, termination or waiver is
approved with the written concurrence of all Lenders minus one (if such one
Lender by itself constitutes Requisite Lenders, then its concurrence shall also
be required)(any Released Guarantor which executes a counterpart Subsidiary
Guaranty shall no longer constitute a Released Guarantor).

 

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In addition,

 

(a)           no amendment, modification, termination or waiver of any provision
of any Note shall be effective without the written concurrence of the Lender
which is the holder of that Note;

 

(b)           no amendment, modification, termination or waiver of any provision
of subsection 2.1A(i) or of any other provision of this Agreement relating to
the Revolving Loan Commitments shall increase the Commitments of any Lender over
the amount thereof then in effect without the consent of such Lender (it being
understood that amendments, modifications or waivers of conditions precedent,
representations and warranties, covenants or Events of Default or of a mandatory
reduction in the Commitments shall not constitute an increase of the Commitment
of any Lender, and that an increase in the available portion of any Commitment
of any Lender shall not constitute an increase in the Commitment of such
Lender); and

 

(c)           no amendment, modification, termination or waiver of any provision
of Section 11 or of any other provision of this Agreement which, by its terms,
expressly requires the approval or concurrence of Administrative Agent shall be
effective without the written concurrence of Administrative Agent.

 

Administrative Agent may, but shall have no obligation to, with the concurrence
of any Lender, execute amendments, modifications, waivers or consents on behalf
of that Lender.  Any waiver or consent shall be effective only in the specific
instance and for the specific purpose for which it was given.  No notice to or
demand on Borrower in any case shall entitle Borrower to any other or further
notice or demand in similar or other circumstances.  Any amendment,
modification, termination, waiver or consent effected in accordance with this
subsection 11.6 shall be binding upon each Lender at the time outstanding, each
future Lender and, if signed by Borrower, on Borrower.

 

Notwithstanding the provisions of this Section 11.6, any amendment pursuant to
subsection 2.1A(ii) to increase or add Revolving Loan Commitments or add a term
loan facility to this Agreement, if adopted in accordance with the terms and
conditions set forth in subsection 2.1A(ii), shall be effective upon execution
by Borrower, Holdings and Administrative Agent and shall not require concurrence
of any Lenders.

 

11.7                        Independence of Covenants.

 

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

 

11.8                        Notices.

 

Unless otherwise specifically provided herein, any notice or other communication
herein required or permitted to be given shall be in writing and may be
personally served,

 

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telexed or sent by telefacsimile or United States mail or courier service and
shall be deemed to have been given when delivered in person or by courier
service, upon receipt of telefacsimile or telex, or three Business Days after
depositing it in the United States mail with postage prepaid and properly
addressed; provided that notices to Administrative Agent shall not be effective
until received.  For the purposes hereof, the address of each party hereto shall
be as set forth under such party’s name on the signature pages hereof or (i) as
to Holdings, Borrower and Administrative Agent, such other address as shall be
designated by such Person in a written notice delivered to the other parties
hereto and (ii) as to each other party, such other address as shall be
designated by such party in a written notice delivered to Administrative Agent.

 

11.9                        Survival of Representations, Warranties and
Agreements.

 

A.            All representations, warranties and agreements made herein shall
survive the execution and delivery of this Agreement and the making of the Loans
and the issuance of the Letters of Credit hereunder.

 

B.            Notwithstanding anything in this Agreement or implied by law to
the contrary, the agreements of Borrower and Holdings set forth in subsections
2.6D, 2.7, 3.5A, 3.6, 11.2, 11.3 and 11.4 and the agreements of Lenders set
forth in subsections 10.2C, 10.4, 11.5 and 11.19 shall survive the payment of
the Loans, the cancellation or expiration of the Letters of Credit and the
reimbursement of any amounts drawn thereunder, and the termination of this
Agreement.

 

11.10                 Failure or Indulgence Not Waiver; Remedies Cumulative.

 

No failure or delay on the part of Administrative Agent or any Lender in the
exercise of any power, right or privilege hereunder or under any other Loan
Document shall impair such power, right or privilege or be construed to be a
waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege.  All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.

 

11.11                 Marshalling; Payments Set Aside.

 

Neither Administrative Agent nor any Lender shall be under any obligation to
marshal any assets in favor of Borrower or any other party or against or in
payment of any or all of the Obligations.  To the extent that Borrower makes a
payment or payments to Administrative Agent or Lenders (or to Administrative
Agent for the benefit of Lenders), or Administrative Agent or Lenders enforce
any security interests or exercise their rights of setoff, and such payment or
payments or the proceeds of such enforcement or setoff or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, any other state or federal law, common law or any equitable
cause (whether by litigation, demand, settlement or otherwise), then, to the
extent of such recovery, the obligation or part thereof originally intended to
be satisfied, and all Liens, rights and remedies therefor or related thereto,
shall be

 

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revived and continued in full force and effect as if such payment or payments
had not been made or such enforcement or setoff had not occurred.

 

11.12                 Severability.

 

In case any provision in or obligation under this Agreement or the Notes shall
be invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.

 

11.13                 Obligations Several; Independent Nature of Lenders’
Rights.

 

The obligations of Lenders hereunder are several and no Lender shall be
responsible for the obligations or Commitments of any other Lender hereunder. 
Nothing contained herein or in any other Loan Document, and no action taken by
Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders, or
Lenders and Holdings or Borrower, as a partnership, an association, a joint
venture or any other kind of entity. The amounts payable at any time hereunder
to each Lender shall be a separate and independent debt, and each Lender shall
be entitled to protect and enforce its rights arising out of this Agreement and
it shall not be necessary for any other Lender to be joined as an additional
party in any proceeding for such purpose.

 

11.14                 Headings.

 

Section and subsection headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose or be given any substantive effect.

 

11.15                 Applicable Law.

 

THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES.

 

11.16                 Successors and Assigns.

 

The provisions of this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective permitted successors and permitted
assigns, except that Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of each Lender
(and any attempted assignment or transfer by Borrower without such consent shall
be null and void).  Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, Affiliates of Administrative Agent and Affiliates of
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.

 

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11.17                 Consent to Jurisdiction and Service of Process.

 

ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST HOLDINGS OR BORROWER ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK.  BY EXECUTING AND
DELIVERING THIS AGREEMENT, BORROWER AND HOLDINGS, FOR THEMSELVES AND IN
CONNECTION WITH THEIR PROPERTIES, IRREVOCABLY

 

(I)            ACCEPT GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE
JURISDICTION AND VENUE OF SUCH COURTS;

 

(II)           WAIVE ANY DEFENSE OF FORUM NON CONVENIENS;

 

(III)         AGREE THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY
SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT
REQUESTED, TO BORROWER AND HOLDINGS AT THEIR ADDRESSES PROVIDED IN ACCORDANCE
WITH SUBSECTION 11.8;

 

(IV)         AGREE THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS SUFFICIENT
TO CONFER PERSONAL JURISDICTION OVER BORROWER OR HOLDINGS IN ANY SUCH PROCEEDING
IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN
EVERY RESPECT;

 

(V)          AGREE THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST HOLDINGS OR BORROWER IN
THE COURTS OF ANY OTHER JURISDICTION; AND

 

(VI)         AGREE THAT THE PROVISIONS OF THIS SUBSECTION 11.17 RELATING TO
JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE FULLEST EXTENT
PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1402 OR OTHERWISE.

 

11.18                 Waiver of Jury Trial.

 

EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS BETWEEN
THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED.  The scope of this
waiver is intended to be all-encompassing of any and all disputes that may be
filed in any court and that relate to the subject matter of this transaction,
including contract claims, tort

 

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claims, breach of duty claims and all other common law and statutory claims. 
Each party hereto acknowledges that this waiver is a material inducement to
enter into a business relationship, that each has already relied on this waiver
in entering into this Agreement, and that each will continue to rely on this
waiver in their related future dealings.  Each party hereto further warrants and
represents that it has reviewed this waiver with its legal counsel and that it
knowingly and voluntarily waives its jury trial rights following consultation
with legal counsel.  THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER
SPECIFICALLY REFERRING TO THIS SUBSECTION 11.18 AND EXECUTED BY EACH OF THE
PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS
MADE HEREUNDER.  In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.

 

11.19                 Confidentiality.

 

Each Lender shall hold all non-public information regarding Holdings and its
Subsidiaries obtained pursuant to the requirements of this Agreement in
accordance with such Lender’s customary procedures for handling confidential
information of this nature and in accordance with safe and sound banking
practices, it being understood and agreed by Borrower and Holdings that in any
event a Lender may make disclosures (a) to its and its Affiliates’ directors,
officers, employees and agents, including accountants, legal counsel and other
advisors (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such information and instructed
to keep such information confidential), (b) to the extent requested by any
government authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
to this Agreement, (e) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder, (f) subject to an agreement containing provisions
substantially the same as those of this subsection 11.19, to (i) any Eligible
Assignee of or Participant in, or any prospective Eligible Assignee of or
Participant in, any of its rights or obligations under this Agreement or
(ii) any direct or indirect contractual counterparty or prospective counterparty
(or such contractual counterparty’s or prospective counterparty’s professional
advisor) to any credit derivative transaction relating to obligations of
Holdings or Borrower, (g) with the consent of Holdings or Borrower, (h) to the
extent such information (i) becomes publicly available other than as a result of
a breach of this subsection 11.19, or (ii) becomes available to Administrative
Agent or any Lender on a nonconfidential basis from a source other than Holdings
or Borrower, or (i) to the National Association of Insurance Commissioners or
any other similar organization or any nationally recognized rating agency that
requires access to information about a Lender’s or its Affiliates’ investment
portfolio in connection with ratings issued with respect to such Lender or its
Affiliates; provided that, unless specifically prohibited by applicable law or
court order, each Lender shall notify Holdings or Borrower of any request by any
government authority or representative thereof (other than any such request in
connection with any examination of the financial condition of such Lender by
such government authority) for disclosure of any such non-public information
prior to disclosure of

 

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such information; and provided, further, that in no event shall any Lender be
obligated or required to return any materials furnished by Holdings or any of
its Subsidiaries.  Notwithstanding anything contained herein to the contrary,
Borrower and Holdings understand and agree that Administrative Agent and each of
the institutions identified as “Co-Lead Arrangers” on the title page to this
Agreement may make customary disclosures for advertising and “league table”
purposes.

 

Notwithstanding anything to contrary herein, each party hereto hereby agrees
that each party hereto (and each of their respective employees, representatives
and agents) is permitted to disclose to any Person, the structure and tax
aspects of the transactions contemplated by the Loan Documents, and all
materials of any kind (including opinions and other tax analyses) that are
related to such structure and tax aspects.  In this regard, each party hereto
acknowledges and agrees that their disclosure of the structure or tax aspects of
such transactions is not limited in any way by an express or implied
understanding or agreement, oral or written (whether or not such agreement or
understanding is legally binding).  Furthermore, each party hereto acknowledges
and agrees that it does not know or have reason to know that its use or
disclosure of information relating to the structure or tax aspects of the
transactions contemplated by the Loan Documents is limited in any other manner
for the benefit of any other Person.

 

11.20                 Co-Lead Arrangers; Syndication Agent; Documentation Agent.

 

None of the institutions identified as “Co-Lead Arrangers,” “Syndication Agent”
or “Documentation Agent” on the title page to this Agreement shall have any
obligations, liabilities or duties under this Agreement other than those
applicable to a Lender (but only if such institution is a Lender) as such, and
no such institutions 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 such institution in deciding to enter into this Agreement or in
taking or not taking any action hereunder.

 

11.21                 Counterparts; Effectiveness.

 

This Agreement and any amendments, waivers, consents or supplements hereto or in
connection herewith may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.  This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Holdings,
Borrower and Administrative Agent of written or telephonic notification of such
execution and authorization of delivery thereof.

 

[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their respective officers thereunto duly authorized as
of the date first written above.

 

 

BORROWER:

 

 

 

LA QUINTA PROPERTIES, INC.

 

 

 

 

 

By:

/s/ Steven J. Flowers

 

 

 

Name:  Steven J. Flowers

 

 

Title:  Vice President and Treasurer

 

 

 

Notice Address:

 

909 Hidden Ridge, Suite 600

 

Irving, Texas 75038

 

Attention:  General Counsel

 

 

 

 

 

HOLDINGS:

 

 

 

LA QUINTA CORPORATION

 

 

 

 

 

By:

/s/ Steven J. Flowers

 

 

 

Name:  Steven J. Flowers

 

 

Title:  Vice President and Treasurer

 

 

 

Notice Address:

 

909 Hidden Ridge, Suite 600

 

Irving, Texas 75038

 

Attention:  General Counsel

 

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ADMINISTRATIVE AGENT:

 

 

 

CANADIAN IMPERIAL BANK OF COMMERCE,
as Administrative Agent

 

 

 

 

 

By:

/s/ Dean J. Decker

 

 

Dean J. Decker

 

Managing Director

 

CIBC World Markets Corp., AS AGENT

 

 

 

Notice Address:

 

 

 

CANADIAN IMPERIAL BANK OF COMMERCE

 

425 Lexington Avenue

 

New York, New York  10017

 

Attn.:  Agency Services Dept.

 

Facsimile No.: (212) 856-3799

 

 

 

With a Copy to:

 

 

 

CIBC WORLD MARKETS CORP.

 

10880 Wilshire Boulevard, Suite 1700

 

Los Angeles, California  90024

 

S-2

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SYNDICATION AGENT:

 

 

 

FLEET SECURITIES INC.,

 

as Syndication Agent

 

 

 

 

 

By:

/s/ Dan Stegemoeller

 

 

Name:  Dan Stegemoeller

 

Title:  Director

 

 

 

Notice Address:

 

 

 

Fleet National Bank

 

115 Perimeter Center Place, N.E.

 

Suite 500

 

Atlanta, Georgia 30346

 

S-3

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DOCUMENTATION AGENT:

 

 

 

CREDIT LYONNAIS NEW YORK BRANCH

 

as Documentation Agent

 

 

 

 

 

By:

/s/ Bruno De Floor

 

 

Name:  Bruno De Floor

 

Title:  Vice President

 

 

 

S-4

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LENDERS:

 

 

 

CIBC, INC., as a Lender

 

 

 

 

 

By:

/s/ Dean J. Decker

 

 

Dean J. Decker

 

Managing Director

 

CIBC World Markets Corp., AS AGENT

 

 

 

Notice Address:

 

 

 

CIBC, INC.

 

425 Lexington Avenue

 

New York, New York  10017

 

Attn.: Agency Services Dept.

 

 

 

Facsimile No.: (212) 856-3799

 

 

 

With a Copy to:

 

 

 

CIBC WORLD MARKETS CORP.

 

10880 Wilshire Boulevard, Suite 1700

 

Los Angeles, California  90024

 

 

 

 

 

FLEET NATIONAL BANK, as a Lender

 

 

 

 

 

By:

/s/ Dan Stegemoeller

 

 

Name:  Dan Stegemoeller

 

Title:    Director

 

 

 

Notice Address:

 

 

 

Fleet National Bank

 

115 Perimeter Center Place, N.E.

 

Suite 500

 

Atlanta, Georgia 30346

 

 

 

 

 

CREDIT LYONNAIS NEW YORK BRANCH, as a Lender

 

 

 

 

 

By:

/s/ Bruno De Floor

 

 

Name:  Bruno De Floor

 

Title:    Vice President

 

S-5

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LEHMAN COMMERCIAL PAPER, Inc., as a Lender

 

 

 

By:

/s/ Francis Chang

 

 

Name:

Francis Chang

 

Title:

Vice President

 

 

 

Notice Address:

 

 

 

 

745 Seventh Ave., 19th Floor

 

 

New York, NY 10019

 

 

 

 

 

MORGAN STANLEY SENIOR FUNDING, as a Lender

 

 

 

By:

/s/ Jaap L. Tonckens

 

 

Name:

Jaap L. Tonckens

 

Title:

Vice President, Morgan Stanley Senior Funding

 

 

 

Notice Address:

 

 

 

 

 

1585 Broadway

 

 

New York, NY 10036

 

 

 

 

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

 

as a Lender

 

 

 

By:

/s/ J. Kent Howard

 

 

Name:

J. Kent Howard

 

Title:

Senior Vice President

 

 

 

 

 

Notice Address:

 

 

5400 LBJ Freeway

 

 

Suite 100

 

 

Dallas, Texas 75240

 

 

Attn: J. Kent Howard

 

 

 

With a copy to:

 

 

c/o Chief Credit Officer - Real Estate Group

 

 

Wells Fargo Bank, N.A.

 

 

420 Montgomery Street, 6th Floor

 

 

San Francisco, California 94163

 

S-6

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