Exhibit 10.1

EXECUTION VERSION

 

 

 

THIRD LIEN CREDIT AGREEMENT

Dated as of June 15, 2016

Between

DYNCORP INTERNATIONAL INC.,

as Borrower,

THE GUARANTORS PARTY HERETO FROM TIME TO TIME

and

DYNCORP FUNDING LLC,

as Lender and Collateral Agent

 

 

 

Reference is made to the Intercreditor Agreement, dated as of June 15, 2016,
between BANK OF AMERICA, N.A., as Priority Lien Agent (as defined therein),
WILMINGTON TRUST, NATIONAL ASSOCIATION, as Second Lien Collateral Trustee (as
defined therein), and DYNCORP FUNDING LLC, as Third Lien Collateral Trustee (as
defined therein) (the “Intercreditor Agreement”). Each holder of Initial Third
Lien Obligations (as defined therein), by its acceptance of such Initial Third
Lien Obligations (i) consents to the subordination of Liens as provided for in
the Intercreditor Agreement, (ii) agrees that it will be bound by, and will take
no actions contrary to, the provisions of the Intercreditor Agreement and
(iii) authorizes and instructs the Third Lien Collateral Trustee (as defined
therein) on behalf of each Third Lien Secured Party (as defined therein) to
enter into the Intercreditor Agreement as Third Lien Collateral Trustee on
behalf of such Third Lien Secured Parties. The foregoing provisions are intended
(i) as an inducement to the lenders under the Priority Credit Agreement (as
defined in the Intercreditor Agreement) to extend credit to DynCorp
International Inc. and such lenders are intended third party

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beneficiaries of such provisions and the provisions of the Intercreditor
Agreement and (ii) as an inducement to the holders of the Second Lien Indenture
Notes (as defined therein) to acquire such Second Lien Indenture Notes and such
holders are intended third party beneficiaries of such provisions and the
provisions of the Intercreditor Agreement.

Capitalized terms used and not defined in this paragraph have the respective
meanings assigned to them in the Intercreditor Agreement. The Third Lien
Collateral Trustee, for itself and on behalf of each Third Lien Secured Party,
agrees and acknowledges that, and each holder of a Third Lien Obligation by its
acceptance hereof acknowledges and agrees that, in accordance with the
restrictions set forth in the Intercreditor Agreement, (i) the Third Lien
Obligations shall in all respects be subordinate and junior in right of payment
to all Priority Lien Obligations and Second Lien Obligations in the manner and
to the extent set forth in the Intercreditor Agreement, (ii) until the Discharge
of Priority Lien Obligations and Second Lien Obligations, the Third Lien Secured
Parties and any other holders of the Third Lien Obligations (x) shall not be
entitled at any time to receive or collect any payments in respect of principal,
interest or any other amounts payable in respect of the Third Lien Obligations
by or on behalf of DynCorp or any other Grantor or any of DynCorp’s Subsidiaries
(other than as expressly set forth in the Intercreditor Agreement), and
(y) shall not take, demand or receive from DynCorp, any other Grantor or any of
DynCorp’s other Subsidiaries, and DynCorp, the other Grantors and DynCorp’s
other Subsidiaries shall not make, give or permit, directly or indirectly, any
payment of the whole or any portion of the Third Lien Obligations, including
without limitation by way of deduction from or setoff against any amounts due to
DynCorp, any other Grantor or any of DynCorp’s other Subsidiaries from holders
of Third Lien Obligations (except as expressly permitted by the Intercreditor
Agreement), and (iii) in the event the Priority Lien Obligations or the Second
Lien Obligations become due and payable in full, whether upon maturity,
acceleration or otherwise, any payment or distribution of any kind or character,
whether in cash, property or securities which, but for the provisions of the
Intercreditor Agreement would otherwise be payable or deliverable upon or in
respect of any Third Lien Obligations, shall instead be paid over and delivered
(x) until Discharge of Priority Lien Obligations, to the Priority Lien Agent,
for application on account of the Priority Lien Obligations, and (y) following
Discharge of Priority Lien Obligations and prior to Discharge of Second Lien
Obligations, to the Second Lien Collateral Trustee, for application on account
of the Second Lien Obligations in each case, in accordance with the terms of the
Intercreditor Agreement, with the result that the Third Lien Secured Parties
shall not receive any such payment or distribution or any benefit therefrom. The
Third Lien Collateral Trustee, for itself and on behalf of each other Third Lien
Secured Party, agrees that and each holder of a Third Lien Obligation by its
acceptance hereof acknowledges and agrees that if, contrary to the preceding
sentence, other than as expressly permitted by the Intercreditor Agreement, the
Third Lien Collateral Trustee or any other Third Lien Secured Party (or any
other holder of Third Lien Obligations) shall receive or collect any payment or
distribution of any kind or character, whether in cash, property or securities,
from DynCorp or any other Grantor or any of DynCorp’s Subsidiaries at any time
prior to the Discharge of Priority Lien Obligations and Discharge of Second Lien
Obligations, then (i) until Discharge of Priority Lien Obligations, it shall
hold such amount in trust for the Priority Lien Agent and the other Priority
Lien Secured Parties and transfer such amount to the Priority Lien Agent as
promptly as practicable, in

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the form received (with any necessary endorsements) and (ii) following Discharge
of Priority Lien Obligations and prior to Discharge of Second Lien Obligations,
it shall hold such amount in trust for the Second Lien Collateral Trustee and
the other Second Lien Secured Parties and transfer such amount to the Second
Lien Collateral Trustee as promptly as practicable, in the form received (with
any necessary endorsements).

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TABLE OF CONTENTS

 

             Page   ARTICLE I INTERPRETATION      1      Section 1.1   Defined
Terms      1      Section 1.2   Other Interpretive Provisions      30    ARTICLE
II CREDIT FACILITY      31      Section 2.1   Loans      31      Section 2.2  
Interest      31      Section 2.3   Repayment      31      Section 2.4  
Prepayments      31      Section 2.5   Computation of Interest      32     
Section 2.6   Evidence of Indebtedness      32      Section 2.7   Payments by
the Borrower      32    ARTICLE III CONDITIONS TO LOANS      32      Section 3.1
  Conditions to Loans      32    ARTICLE IV CERTAIN REPRESENTATIONS AND
WARRANTIES      34      Section 4.1   Organization; Power; Qualification      35
     Section 4.2   Authorization; Enforceability      35      Section 4.3  
Litigation      35      Section 4.4   Ownership      35      Section 4.5  
Absence of Defaults      35      Section 4.6   Compliance of Agreement, Loan
Documents and Borrowing with Laws, Etc.      36      Section 4.7   Compliance
with Law; Governmental Approvals      36      Section 4.8   Margin Stock      36
     Section 4.9   Government Regulation      37      Section 4.10   Collateral
Documents      37      Section 4.11   Use of Proceeds      38    ARTICLE V
CERTAIN COVENANTS      38    ARTICLE VI DEFAULT      38      Section 6.1  
Events of Default      38      Section 6.2   Remedies upon Event of Default     
40    ARTICLE VII      41    GUARANTEE      41      Section 7.1   The Guarantee
     41      Section 7.2   Obligations Unconditional      41      Section 7.3  
Reinstatement      42      Section 7.4   Subrogation; Subordination      43     
Section 7.5   Remedies      43      Section 7.6   Instrument for the Payment of
Money      43      Section 7.7   Continuing Guarantee      43      Section 7.8  
General Limitation on Guarantee Obligations      43      Section 7.9   Release
of Guarantors      43      Section 7.10   Right of Contribution      44   

 

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             Page   ARTICLE VIII MISCELLANEOUS      44      Section 8.1  
Notices and Deliveries      44      Section 8.2   Amounts Payable Due upon
Request for Payment      45      Section 8.3   Rights Cumulative      45     
Section 8.4   Amendments; Waivers      45      Section 8.5   Set-Off      46   
  Section 8.6   Assignments and Participations      46      Section 8.7  
Attorney Costs and Expenses      46      Section 8.8   Indemnification by the
Borrower      47      Section 8.9   Governing Law      48      Section 8.10  
Judicial Proceedings; Waiver of Jury Trial      48      Section 8.11  
Severability of Provisions      48      Section 8.12   Counterparts      49     
Section 8.13   Entire Agreement      49      Section 8.14   Successors and
Assigns      49      Section 8.15   Release of Collateral      49     
Section 8.16   Intercreditor      50   

ARTICLE IX COLLATERAL AGENT AND OTHER AGENTS

     50      Section 9.1   Appointment and Authorization of Agents.      50     
Section 9.2   Delegation of Duties.      51      Section 9.3   Liability of
Agents.      51      Section 9.4   Reliance by Agents.      51      Section 9.5
  Credit Decision; Disclosure of Information by Agents.      52      Section 9.6
  Indemnification of Agents.      52      Section 9.7   Successor Agents.     
53      Section 9.8   Collateral Agent May File Proofs of Claim.      53     
Section 9.9   Collateral and Guaranty Matters.      54      Section 9.10  
Appointment of Supplemental Agents.      55   

SCHEDULE 4.3: LITIGATION

SCHEDULE 4.4: OWNERSHIP

SCHEDULE 4.6: COMPLIANCE OF AGREEMENT WITH OTHER CONTRACTS

EXHIBIT A: FORM OF INTERCREDITOR AGREEMENT

EXHIBIT B: FORM OF NOTE

EXHIBIT C: FORM OF SECURITY AGREEMENT

ANNEX A: COVENANTS

 

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EXECUTION VERSION

DYNCORP INTERNATIONAL INC., a Delaware corporation, as Borrower, Delta Tucker
Holdings, Inc., the Subsidiary Guarantors (as defined below) party hereto from
time to time, DYNCORP FUNDING LLC, a Delaware limited liability company, as
Lender and DYNCORP FUNDING LLC, a Delaware limited liability company as
collateral agent (in such capacity, the “Collateral Agent”), agree as follows
(with certain terms used herein being defined in Article I):

ARTICLE I

INTERPRETATION

Section 1.1 Defined Terms. For the purposes of this Agreement:

“Acquired Indebtedness” means, with respect to any specified Person:

(1) Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Restricted Subsidiary of such specified Person,
and

(2) Indebtedness secured by a Lien encumbering any asset acquired by such
specified Person,

in each case, other than Indebtedness Incurred as consideration in, in
contemplation of, or to provide all or any portion of the funds or credit
support utilized to consummate, the transaction or series of related
transactions pursuant to which such Restricted Subsidiary became a Restricted
Subsidiary or was otherwise acquired by such Person, or such asset was acquired
by such Person, as applicable.

“Affiliate” means, with respect to any Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or
is under common Control with the Person specified. “Control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the ability
to exercise voting power, by contract or otherwise. “Controlling” and
“Controlled” have meanings correlative thereto.

“Affiliate Transaction” has the meaning set forth in Section 7 under Annex A.

“Agent-Related Persons” means the Collateral Agent, together with their
respective Affiliates, and the officers, directors, employees, counsel, agents,
trustees, investment advisors and attorneys-in-fact of such Persons and
Affiliates.

“Agreement” means this Third Lien Credit Agreement, including all schedules,
annexes and exhibits hereto.

“Amortization Payments” means, collectively, with respect to the new senior
secured first-priority term loan facility under the First Lien Credit Agreement,
the repayment by the Borrower to the First Lien Agent for the ratable account of
the term loan lenders (i) on or prior to the first anniversary of the effective
date

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of the First Lien Credit Agreement, an aggregate amount equal to $22.5 million
and (ii) on or prior to the second anniversary of the effective date of the
First Lien Credit Agreement, an aggregate amount equal to $22.5 million (which
payments may be reduced as a result of the application of prepayments in
accordance with the First Lien Credit Agreement).

“Applicable Law” means all applicable provisions of constitutions, laws,
statutes, ordinances, rules, treaties, regulations, permits, licenses,
approvals, interpretations and orders of courts or Governmental Authorities and
all orders and decrees of all courts and arbitrators.

“Asset Sale” means:

(1) the sale, conveyance, transfer, license or other disposition (whether in a
single transaction or a series of related transactions) of property or assets
(including by way of a Sale/Leaseback Transaction) of the Borrower or any
Restricted Subsidiary of the Borrower (each referred to in this definition as a
“disposition”) or

(2) the issuance or sale of Equity Interests (other than directors’ qualifying
shares or shares or interests required to be held by foreign nationals or other
third parties to the extent required by applicable law) of any Restricted
Subsidiary (other than to the Borrower or another Restricted Subsidiary of the
Borrower) (whether in a single transaction or a series of related transactions),
in each case other than:

(a) a disposition of Cash Equivalents or Investment Grade Securities or obsolete
or worn out equipment in the ordinary course of business;

(b) the disposition of all or substantially all of the assets of the Borrower in
a manner permitted pursuant to Section 21 under Annex A or any disposition that
constitutes a Change of Control;

(c) any Restricted Payment or Permitted Investment that is permitted to be made,
and is made, under Section 4 under Annex A;

(d) any disposition of assets or issuance or sale of Equity Interests of any
Restricted Subsidiary with an aggregate Fair Market Value of less than
$5.0 million;

(e) any disposition of property or assets by a Restricted Subsidiary of the
Borrower to the Borrower or by the Borrower or a Restricted Subsidiary of the
Borrower to a Restricted Subsidiary of the Borrower;

(f) sales of assets received by the Borrower or any of its Restricted
Subsidiaries upon the foreclosure on a Lien;

(g) [reserved];

(h) sales of inventory or other current assets held for sale in the ordinary
course of business;

 

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(i) the lease, assignment or sublease of any real or personal property in the
ordinary course of business and consistent with past practice;

(j) [reserved];

(k) [reserved];

(l) [reserved];

(m) the grant in the ordinary course of business of any license of patents,
trademarks, know-how and any other intellectual property; and

(n) the sale of any property in a Sale/Leaseback Transaction within six months
of the acquisition of such property.

“Attorney Costs” means and includes all reasonable fees, expenses and
disbursements of any law firm or other external legal counsel.

“Bankruptcy Code” means Title 11 of the United States Code, as amended, or any
similar federal or state law for the relief of debtors.

“Board of Directors” means as to any Person, the board of directors or managers,
sole member or managing member, as applicable, of such Person (or, if such
Person is a partnership, the board of directors or other governing body of the
general partner of such Person) or any duly authorized committee thereof.

“Borrower” means Dyncorp International Inc., a Delaware corporation or any of
its successors or assigns.

“Business Day” means any day other than a Saturday, Sunday or other day on which
banks in New York City are authorized to close.

“Capital Stock” means:

(1) in the case of a corporation, corporate stock;

(2) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock;

(3) in the case of a partnership or limited liability company, partnership or
membership interests (whether general or limited); and

(4) any other interest or participation that confers on a Person the right to
receive a share of the profits and losses of, or distributions of assets of, the
issuing Person.

“Capitalized Lease Obligation” means, at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that would
at such time be required to be capitalized and reflected as a liability on a
balance sheet (excluding the footnotes thereto) in accordance with GAAP.

 

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“Cash Equivalents” means:

(1) U.S. Dollars, pounds sterling, euros, the national currency of any
participating member state of the European Union or, in the case of any Foreign
Subsidiary that is a Restricted Subsidiary, such local currencies held by it
from time to time in the ordinary course of business;

(2) securities issued or directly and fully guaranteed or insured by the
government of the United States or any country that is a member of the European
Union or any agency or instrumentality thereof in each case with maturities not
exceeding two years from the date of acquisition;

(3) certificates of deposit, time deposits and eurodollar time deposits with
maturities of one year or less from the date of acquisition, bankers’
acceptances, in each case with maturities not exceeding one year, and overnight
bank deposits, in each case with any commercial bank having capital and surplus
in excess of $500 million, or the foreign currency equivalent thereof, and whose
long-term debt is rated “A” or the equivalent thereof by Moody’s or S&P (or
reasonably equivalent ratings of another Nationally Recognized Statistical
Rating Organization);

(4) repurchase obligations for underlying securities of the types described in
clauses (2) and (3) above entered into with any financial institution meeting
the qualifications specified in clause (3) above;

(5) commercial paper issued by a corporation (other than an Affiliate of the
Borrower) rated at least “A-1” or the equivalent thereof by Moody’s or S&P (or
reasonably equivalent ratings of another Nationally Recognized Statistical
Rating Organization) and in each case maturing within one year after the date of
acquisition;

(6) readily marketable direct obligations issued by any state of the United
States of America or any political subdivision thereof having one of the two
highest rating categories obtainable from either Moody’s or S&P (or reasonably
equivalent ratings of another Nationally Recognized Statistical Rating
Organization) in each case with maturities not exceeding two years from the date
of acquisition;

(7) Indebtedness issued by Persons (other than the Sponsor or any of its
Affiliates) with a rating of “A” or higher from S&P or “A-2” or higher from
Moody’s in each case with maturities not exceeding two years from the date of
acquisition; and

(8) investment funds investing at least 95% of their assets in securities of the
types described in clauses (1) through (7) above.

“Cerberus” means Cerberus Capital Management, L.P. or any Affiliate of Cerberus
Capital Management, L.P. and its successors.

 

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“Change of Control” means the occurrence of any of the following events:

(i) the sale, lease or transfer, in one or a series of related transactions, of
all or substantially all the assets of the Borrower and its Subsidiaries, taken
as a whole, to a Person other than any of the Permitted Holders, and other than
any transaction in compliance with Section 21 of Annex A where the Successor
Company is a Wholly Owned Subsidiary of a direct or indirect parent of the
Borrower;

(ii) the Borrower becomes aware (by way of a report or any other filing pursuant
to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise)
of the acquisition by any Person or group (within the meaning of
Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor
provision), including any group acting for the purpose of acquiring, holding or
disposing of securities (within the meaning of Rule 13d-5(b)(1) under the
Exchange Act), other than any of the Permitted Holders, in a single transaction
or in a related series of transactions, by way of merger, consolidation or other
business combination or purchase of beneficial ownership (within the meaning of
Rule 13d-3 under the Exchange Act, or any successor provision), of more than 50%
of the total voting power of the Voting Stock of the Borrower or any direct or
indirect parent of the Borrower; or

(iii) the adoption by the Borrower or Holdings of a plan or proposal for the
liquidation, dissolution or reorganization of the Borrower or Holdings.

“Change of Control Offer” has the meaning set forth in Section 8(b) of Annex A.

“Code” means the Uniform Commercial Code from time to time in effect in the
State of New York; provided, however, that if by reason of mandatory provisions
of law, the perfection or the effect of perfection or non-perfection of the
security interests granted hereunder in any item or portion of the Collateral is
governed by the Uniform Commercial Code of a jurisdiction other than New York,
“Code” means the Uniform Commercial Code as in effect in such other jurisdiction
for purposes of provisions hereof relating to such perfection or effect of
perfection or non-perfection.

“Collateral” has the meaning set forth in the Security Agreement.

“Collateral Agent” means DynCorp Funding LLC, in its capacity as collateral
agent or pledgee in its own name under any of the Loan Documents, or any
successor collateral agent.

“Collateral and Guarantee Requirement” means, at any time, the requirement that:

(a) the Obligations shall have been secured by a third-priority security
interest (subject only to Liens securing the First Lien Obligations, Permitted
Second Lien Obligations and certain other Permitted Liens) in (i) all the Equity
Interests of the Borrower and (ii) all Equity Interests of each Restricted
Subsidiary of Holdings that is not an Excluded Subsidiary directly owned by the
Borrower or any Guarantor, in each case, subject to exceptions and limitations
otherwise set forth in this Agreement and the Collateral Documents (to the
extent appropriate in the applicable jurisdiction);

 

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(b) the Obligations shall have been secured by a perfected third-priority
security interest (subject only to Liens securing the First Lien Obligations,
Permitted Second Lien Obligations and certain other Permitted Liens) in, and
mortgages on, substantially all tangible and intangible assets of the Borrower
and each Guarantor (including Equity Interests and intercompany debt, accounts,
inventory, machinery and equipment, accounts receivable, chattel paper,
insurance proceeds, hedge agreement documents, instruments, indemnification
rights, tax refunds, cash, investment property, contract rights, intellectual
property in the United States, other general intangibles, Material Real Property
and proceeds of the foregoing), in each case, subject to exceptions and
limitations otherwise set forth in this Agreement and the Collateral Documents
(to the extent appropriate in the applicable jurisdiction);

(c) subject to limitations and exceptions of this Agreement and the Collateral
Documents, to the extent a security interest in and mortgages on any Material
Real Property is required under this Agreement (together with any Material Real
Property that is subject to a mortgage on the Closing Date, each, a “mortgaged
property”), the Collateral Agent shall have received (i) counterparts of a
mortgage with respect to such mortgaged property duly executed and delivered by
the record owner of such property in form suitable for filing or recording in
all filing or recording offices that the Collateral Agent may reasonably deem
necessary or desirable in order to create a valid and subsisting perfected
third-priority Lien (subject only to Liens described in clause (ii) below) on
the property and/or rights described therein in favor of the Collateral Agent
and evidence that all filing and recording taxes and fees have been paid or
otherwise provided for in a manner reasonably satisfactory to the Collateral
Agent (it being understood that if a mortgage tax will be owed on the entire
amount of the indebtedness evidenced hereby, then the amount secured by the
mortgage shall be limited to 100% of the fair market value of the property at
the time the mortgage is entered into if such limitation results in such
mortgage tax being calculated based upon such fair market value), (ii) fully
paid policies of title insurance (or marked-up title insurance commitments
having the effect of policies of title insurance) on the mortgaged property
naming the Collateral Agent as the insured for its benefit and that of its
successors and assigns issued by a nationally recognized title insurance company
reasonably acceptable to the Collateral Agent in form and substance and in an
amount reasonably acceptable to the Collateral Agent (not to exceed 100% of the
fair market value of the real properties covered thereby), insuring the
mortgages to be valid subsisting third-priority Liens on the property described
therein, free and clear of all Liens other than Permitted Liens and other Liens
reasonably acceptable to the Collateral Agent, each of which shall (A) to the
extent reasonably necessary, include such reinsurance arrangements (with
provisions for direct access, if reasonably necessary) as shall be reasonably
acceptable to the Collateral Agent, (B) contain a “tie-in” or “cluster”
endorsement, if available under applicable law (i.e., policies which insure
against losses regardless of location or allocated value of the insured property
up to a stated maximum coverage amount), (C) have been supplemented by such
endorsements (or where such endorsements are not available, opinions of special
counsel, architects or other professionals reasonably acceptable to the
Collateral Agent) as shall be reasonably requested by the Collateral Agent
(including endorsements on matters relating to usury, first loss, last dollar,
zoning, contiguity, revolving credit (if available after the applicable Borrower
or Guarantor uses commercially reasonable efforts), doing business,
non-imputation, public road access, variable rate, environmental lien,
subdivision, mortgage recording tax, separate tax lot and so-called
comprehensive coverage over covenants and restrictions; provided, however, the
applicable Borrower or Guarantor shall not be obligated to obtain a “creditor’s
rights” endorsement), (iii)

 

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legal opinions, addressed to the Collateral Agent, reasonably acceptable to the
Collateral Agent as to such matters as the Collateral Agent may reasonably
request, (iv) a survey or express map of each mortgaged property sufficient in
form to delete the standard survey exception in the title insurance policy
insuring the mortgage and provide the Collateral Agent with endorsements to such
policy as shall be reasonably requested by the Collateral Agent and (v) a
completed “life of the loan” Federal Emergency Management Agency Standard Flood
Hazard Determination with respect to each mortgaged property duly executed and
acknowledged by the appropriate Borrower or Guarantor;

(d) after the Closing Date, each Restricted Subsidiary of Holdings that is not
an Excluded Subsidiary shall become a Guarantor under this Agreement by
executing and delivering a joinder to this Agreement to the Lender in accordance
with Section 10 under Annex A and shall execute and deliver to the Collateral
Agent a joinder to the applicable Collateral Documents in accordance with
Section 10 under Annex A; provided that notwithstanding the foregoing
provisions, any Subsidiary of Holdings that guarantees First Lien Obligations,
Second Lien Notes or the Senior Notes shall be a Guarantor hereunder for so long
as it Guarantees such Indebtedness; and

(e) within 60 days after the Closing Date for such accounts in existence as of
the Closing Date and within 30 days after the opening of any such account
following the Closing Date (as each such date may be extended by the First Lien
Agent in its sole discretion for up to an additional 60 days so long as the
Borrower is using commercially reasonable efforts to obtain such control
agreements), the Borrower and each Guarantor shall cause each deposit account or
securities account owned by the Borrower and any Guarantor located at a
depositary bank in the United States to be subject to control agreements
pursuant to which a perfected security interest shall be created in favor of the
Collateral Agent in such deposit accounts and securities accounts (other than
(i) deposit accounts or securities accounts maintained with the Collateral
Agent, Second Lien Collateral Agent as bailee for the Collateral Agent or the
First Lien Agent as bailee for the Collateral Agent, (ii) payroll accounts and
(iii) deposit accounts and securities accounts in which, in the aggregate, there
is no more than $1.0 million on deposit).

Notwithstanding the foregoing provisions of this definition or anything in this
Agreement or any other Collateral Document to the contrary:

(A) the foregoing definition shall not require, unless otherwise stated in this
clause (A), the creation or perfection of pledges of, security interests in,
mortgages on, or the obtaining of title insurance or taking other actions with
respect to, (i) any fee owned real property (other than Material Real
Properties) and any leasehold rights and interests in real property (including
landlord waivers, estoppels and collateral access letters), (ii) helicopters,
motor vehicles and other assets subject to certificates of title, letters of
credit with a face value of less than $1.0 million and commercial tort claims
where the amount of damages claimed by the applicable Borrower or Guarantor is
less than $1.0 million), (iii) any particular asset, if the pledge thereof or
the security interest therein is prohibited by law other than to the extent such
prohibition is expressly deemed ineffective under the Uniform Commercial Code or
other applicable Law notwithstanding such prohibition, (iv) margin stock and,
solely to the extent prohibited by the

 

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organization documents or any shareholders agreement with shareholders that are
not direct or indirect wholly owned Restricted Subsidiaries of Holdings, Equity
Interests in any Person other than wholly owned Restricted Subsidiaries, (v) any
rights of any Borrower or Guarantor with respect to any lease, license or other
agreement to the extent a grant of security interest therein is prohibited by
such lease, license or other agreement, would result in an invalidation thereof
or would create a right of termination in favor of any other party thereto
(other than the Borrower or Guarantor) after giving effect to the applicable
anti-assignment provisions of the Uniform Commercial Code or other applicable
Laws or principle of equity notwithstanding such prohibition, (vi) the creation
or perfection of pledges of, security interests in, any property or assets that
would result in material adverse tax consequences to Holdings, the Borrower or
any of its Subsidiaries, as reasonably determined by the Borrower with the
consent of the Collateral Agent (not to be unreasonably withheld or delayed),
(vii) intellectual property to the extent a security interest is not perfected
by filing of a UCC financing statement or in respect of registered intellectual
property, a filing in the U.S. Patent and Trademark Office (if required) or the
U.S. Copyright Office (it being understood that such assets are intended to
constitute Collateral, though perfection beyond UCC, U.S. Patent and Trademark
Office and U.S. Copyright Office filings is not required) and (viii) any
particular assets if, in the reasonable judgment of the Collateral Agent,
determined in consultation with the Borrower, the burden, cost or consequences
of creating or perfecting such pledges or security interests in such assets is
excessive in relation to the benefits to be obtained therefrom by the Lender;

(B) (i) the foregoing definition shall not require perfection by “control” with
respect to any Collateral, other than (x) deposit accounts and securities
accounts located at a depositary bank in the United States as set forth in
clause (e) above and (y) certificated Equity Interests of the Borrower and, to
the extent constituting Collateral, its Restricted Subsidiaries that are
Domestic Subsidiaries; and (ii) except to the extent that perfection and
priority may be achieved by the filing of a financing statement under the
Uniform Commercial Code with respect to the Borrower or a Guarantor, or, with
respect to real property and the recordation of mortgages in respect thereof, as
contemplated by clauses (c) and (d) above, the Collateral Documents shall not
contain any requirements as to perfection or priority with respect to any assets
or property not specifically described in this clause (B);

(C) the Collateral Agent in its discretion may grant extensions of time for the
creation or perfection of security interests in, and mortgages on, or obtaining
of title insurance or taking other actions with respect to, particular assets
(including extensions beyond the Closing Date) or any other compliance with the
requirements of this definition where it reasonably determines, in consultation
with the Borrower, that the creation or perfection of security interests and
mortgages on, or obtaining of title insurance or taking other actions, or any
other compliance with the requirements of this definition cannot be accomplished
without undue delay, burden or expense by the time or times at which it would

 

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otherwise be required by this Agreement or the Collateral Documents; provided
that the Collateral Agent shall have received on or prior to the Closing Date,
(i) UCC financing statements in appropriate form for filing under the UCC in the
jurisdiction of incorporation or organization of the Borrower and each
Guarantor, and (ii) any certificates or instruments representing or evidencing
Equity Interests of the Borrower and any Guarantors that are subsidiaries of
Holdings accompanied by instruments of transfer and stock powers undated and
endorsed in blank;

(D) with respect to a stock pledge, the exclusion of an Excluded Subsidiary
shall not apply to (A) voting stock of any Subsidiary which is a first-tier
Foreign Subsidiary representing 65% of the total voting power of all outstanding
voting stock of such Subsidiary and (B) 100% of the Equity Interests not
constituting voting stock of any such Subsidiary, except that any such Equity
Interests constituting “stock entitled to vote” within the meaning of Treasury
Regulation Section 1.956-2(c)(2) shall be treated as voting stock for this
purpose;

(E) Liens required to be granted from time to time pursuant to the Collateral
and Guarantee Requirement shall be subject to exceptions and limitations set
forth in this Agreement and the Collateral Documents; and

(F) wherever a matter set forth in this definition is required to be
satisfactory to the Collateral Agent, delivered upon request of the Collateral
Agent or subject to extension, adjustment or other determination by the
Collateral Agent except as otherwise provided in this Agreement, such matter
shall be deemed to be satisfactory, requested or extended, adjusted or
determined if the First Lien Agent or the Second Lien Collateral Agent has taken
such corresponding action in connection with the corresponding requirement in
the First Lien Credit Agreement or Second Lien Indenture, as applicable.

“Collateral Documents” means, collectively, the Security Agreement, each of the
Mortgages, collateral assignments, security agreements, pledge agreements,
intellectual property security agreements or other similar agreements delivered
to the Secured Party pursuant Section 19 under Annex A, and each of the other
agreements, instruments or documents that creates or purports to create a Lien
in favor of the Secured Party.

“Closing Date” means the first date on which all the conditions precedent in
Section 3.01 are satisfied or waived, which date is June 15, 2016.

“Contingent Obligations” means, with respect to any Person, any obligation of
such Person guaranteeing any leases, dividends or other obligations that do not
constitute Indebtedness (referred to in this definition as the “primary
obligations”) of any other Person (referred to in this definition as the
“primary obligor”) in any manner, whether directly or indirectly, including,
without limitation, any obligation of such Person, whether or not contingent:

 

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(1) to purchase any such primary obligation or any property constituting direct
or indirect security therefor,

(2) to advance or supply funds:

(a) for the purchase or payment of any such primary obligation; or

(b) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor; or

(3) to purchase property, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the primary
obligor to make payment of such primary obligation against loss in respect
thereof.

“Contractual Obligation” means, as to any Person, any provision of any security
issued by such Person or of any agreement, instrument or other undertaking to
which such Person is a party or by which it or any of its property is bound.

“Contribution Indebtedness” means Indebtedness of the Borrower or any Guarantor
in an aggregate principal amount not greater than the aggregate amount of cash
contributions (other than Excluded Contributions) made to the capital of the
Borrower or such Guarantor after the Closing Date, provided that such
Contribution Indebtedness:

(1) shall be Indebtedness with a Stated Maturity later than the Stated Maturity
of the Second Lien Notes,

(2) (a) is Incurred within 210 days after the making of such cash contributions
and (b) is so designated as Contribution Indebtedness pursuant to an certificate
of a Response Officer delivered to the Lender on the Incurrence date thereof,
and

(3) shall be unsecured Subordinated Indebtedness.

“Control” has the meaning set forth in the definition of “Affiliate.”

“Custodian” has the meaning set forth in Section 6.1.

“Debtor Relief Laws” means the Bankruptcy Code of the United States and all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization
or similar debtor relief Laws of the United States or other applicable
jurisdictions from time to time in effect and affecting the rights of creditors
generally.

“Default” means any condition or event that constitutes an Event of Default or
that with the giving of notice or lapse of time or both would, unless cured or
waived, become an Event of Default.

“Discharge of the Second Lien Obligations” has the meaning set forth in the
Intercreditor Agreement.

 

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“Disqualified Stock” means, with respect to any Person, any Capital Stock of
such Person which, by its terms (or by the terms of any security into which it
is convertible or for which it is redeemable or exchangeable), or upon the
happening of any event:

(1) matures or is mandatorily redeemable, pursuant to a sinking fund obligation
or otherwise (other than as a result of a change of control or asset sale;
provided that the relevant asset sale or change of control provisions, taken as
a whole, are no more favorable in any material respect to holders of such
Capital Stock than the asset sale and change of control provisions applicable to
this Agreement and any purchase requirement triggered thereby may not become
operative until compliance with the asset sale and change of control provisions
applicable to this Agreement),

(2) is convertible or exchangeable for Indebtedness or Disqualified Stock, or

(3) is redeemable at the option of the holder thereof, in whole or in part, in
each case prior to 91 days after the maturity date of the Second Lien Notes;
provided, however, that only the portion of Capital Stock which so matures or is
mandatorily redeemable, is so convertible or exchangeable or is so redeemable at
the option of the holder thereof prior to such date shall be deemed to be
Disqualified Stock; provided, further, however, that if such Capital Stock is
issued to any employee or to any plan for the benefit of employees of the
Borrower or its Subsidiaries or by any such plan to such employees, such Capital
Stock shall not constitute Disqualified Stock solely because it may be required
to be repurchased by the Borrower in order to satisfy applicable statutory or
regulatory obligations or as a result of such employee’s termination, death or
disability; provided, further, that any class of Capital Stock of such Person
that by its terms authorizes such Person to satisfy its obligations thereunder
by delivery of Capital Stock that is not Disqualified Stock shall not be deemed
to be Disqualified Stock.

“Dollars” and the sign “$” means the lawful currency of the United States.

“Domestic Subsidiary” means any Subsidiary that is organized under the Laws of
the United States, any state thereof or the District of Columbia.

“Equity Interests” means Capital Stock and all warrants, options or other rights
to acquire Capital Stock (but excluding any debt security that is convertible
into, or exchangeable for, Capital Stock).

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.

“Exchange Offer” means the exchange offer and consent solicitation consummated
on the Closing Date pursuant to the Offering Memorandum.

“Excluded Contributions” means the net cash proceeds, Cash Equivalents and/or
Investment Grade Securities received by the Borrower after the Closing Date
from:

(1) contributions to its common equity capital, and

 

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(2) the sale (other than to a Subsidiary of the Borrower or pursuant to any
Borrower or Subsidiary management equity plan or stock option plan or any other
management or employee benefit plan or agreement) of Capital Stock (other than
Disqualified Stock and Designated Preferred Stock) of the Borrower,

in each case designated as Excluded Contributions pursuant to a certificate
executed by an Responsible Officer of the Borrower delivered to the Lender.

“Excluded Subsidiary” means (a) any Subsidiary that does not have total assets
or annual revenues in excess of $1.0 million individually or in the aggregate
with all other Subsidiaries excluded via this clause (a), (b) any Subsidiary
acquired following the Closing Date that is prohibited by applicable Law or
Contractual Obligations that are in existence at the time of acquisition and not
entered into in contemplation thereof from guaranteeing the Obligations or if
guaranteeing the Obligation would require governmental (including regulatory)
consent, approval, license or authorization (unless such consent, approval
license or authorization has been obtained), (c) any Subsidiary that is a
Foreign Subsidiary or a direct or indirect Subsidiary of a Foreign Subsidiary,
(d) any non-for-profit Subsidiaries, (e) any Unrestricted Subsidiaries and
(f) at Borrower’s election, any Domestic Subsidiary formed or acquired after the
Closing Date that Holdings and its Affiliates do not, directly or indirectly,
own (x) 90% or more of the total voting power of Equity Interests entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees of such Subsidiary or (y) 90% or more of the
economic interests, capital accounts, distribution rights, total equity and
voting interests or general and limited partnership interests, as applicable, of
such Subsidiary; provided that no Subsidiary that guarantees any First Lien
Obligations, the Second Lien Notes or the Senior Notes shall be deemed to be an
Excluded Subsidiary at any time any such guarantee is in effect.

“Event of Default” means any of the events specified in Section 6.1.

“Fair Market Value” means, with respect to any asset or property, the price
which could be negotiated in an arm’s-length, free market transaction, for cash,
between a willing seller and a willing and able buyer, neither of whom is under
undue pressure or compulsion to complete the transaction (as determined in good
faith by the Borrower, unless otherwise specified in this Agreement).

“First Lien Agent” means individually and/or collectively, (i) Bank of America,
N.A., in its capacity as administrative agent and collateral agent under the
First Lien Credit Agreement, together with its successors in such capacity and
(ii) any Person elected, designated or appointed as the administrative agent,
trustee, collateral agent or similar representative with respect to documents
evidencing any First Lien Obligations.

“First Lien Credit Agreement” means that certain Credit Agreement, dated as of
July 7, 2010, among DynCorp International Inc., Delta Tucker Holdings, Inc., the
subsidiary guarantors party thereto from time to time, the lenders party thereto
from time to time and Bank of America, N.A., as administrative agent and as
collateral agent, as amended, restated, modified and supplemented from time to
time.

 

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“First Lien Obligations” means all “Obligations” as defined in the First Lien
Credit Agreement of the Borrower and the Guarantors, and all other obligations
under any other document relating to the First Lien Credit Agreement.

“Fixed Charge Coverage Ratio” has the meaning set forth in the Second Lien
Indenture as in effect on the Closing Date.

“Foreign L/C Facility” means a credit facility established on or after the
Closing Date with a foreign domiciled bank, the sole purpose of which facility
is to provide for the issuance of letters of credit in support of the Borrower’s
pursuit and performance of contracts with customers located in the Specified
Gulf States.

“Foreign Subsidiary” means any direct or indirect Subsidiary of Holdings which
is not a Domestic Subsidiary.

“GAAP” means generally accepted accounting principles in the United States, as
in effect from time to time; provided, however, that if the Borrower notifies
the Lender that the Borrower requests an amendment to any provision hereof to
eliminate the effect of any change occurring after the Closing Date in GAAP or
in the application thereof on the operation of such provision (or if the Lender
notifies the Borrower that the Lender requests an amendment to any provision
hereof for such purpose), regardless of whether any such notice is given before
or after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith and the Lender and
the Borrower shall negotiate in good faith to amend such provision to preserve
the original intent thereof in light of such change in GAAP (subject to the
approval of the Lender); provided, further, that if reasonably requested by the
Lender, the Borrower shall provide to the Lender financial statements and other
documents setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP. For the
avoidance of doubt, to the extent that any operating leases are required to be
reflected in the balance sheet of Holdings or the Borrower starting for fiscal
years and interim periods within those years beginning after December 15, 2018,
under generally accepted accounting principles in effect at such time, such
operating leases will not be deemed to be Indebtedness for any purpose under
this Agreement.

“Global Advisory Group” means a group of former government and military
officials and related staff providing advisory services to the Borrower.

“Governmental Approval” means any authority, consent, approval, license (or the
like) or exemption (or the like) of any governmental unit.

“Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra-national bodies such as the European Union or the European Central Bank).

 

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“Guarantee” means, as to any Person, without duplication, (a) any obligation,
contingent or otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other monetary obligation payable or
performable by another Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or other monetary obligation, (ii) to purchase or
lease property, securities or services for the purpose of assuring the obligee
in respect of such Indebtedness or other monetary obligation of the payment or
performance of such Indebtedness or other monetary obligation, (iii) to maintain
working capital, equity capital or any other financial statement condition or
liquidity or level of income or cash flow of the primary obligor so as to enable
the primary obligor to pay such Indebtedness or other monetary obligation, or
(iv) entered into for the purpose of assuring in any other manner the obligee in
respect of such Indebtedness or other monetary obligation of the payment or
performance thereof or to protect such obligee against loss in respect thereof
(in whole or in part), or (b) any Lien on any assets of such Person securing any
Indebtedness or other monetary obligation of any other Person, whether or not
such Indebtedness or other monetary obligation is assumed by such Person (or any
right, contingent or otherwise, of any holder of such Indebtedness to obtain any
such Lien); provided that the term “Guarantee” shall not include endorsements
for collection or deposit, in either case in the ordinary course of business, or
customary and reasonable indemnity obligations in effect on the Closing Date or
entered into in connection with any acquisition or disposition of assets
permitted under this Agreement (other than such obligations with respect to
Indebtedness). The amount of any Guarantee shall be deemed to be an amount equal
to the stated or determinable amount of the related primary obligation, or
portion thereof, in respect of which such Guarantee is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof as
determined by the guaranteeing Person in good faith. The term “Guarantee” as a
verb has a corresponding meaning.

“Guaranteed Obligations” has the meaning set forth in Section 7.1.

“Guarantor” means Holdings and the Subsidiaries of Holdings (other than the
Borrower) and any other Subsidiary that guarantees the Obligations on or after
the Closing Date.

“Guaranty” means, collectively, the guaranty of the Obligations by the
Guarantors pursuant to this Agreement.

“Hedging Obligations” means, with respect to any Person, the obligations of such
Person under:

(1) currency exchange, interest rate or commodity swap agreements, currency
exchange, interest rate or commodity cap agreements and currency exchange,
interest rate or commodity collar agreements; and

(2) other agreements or arrangements designed to protect such Person against
fluctuations in currency exchange, interest rates or commodity prices.

“Holdings” means Delta Tucker Holdings, Inc., a Delaware corporation or any
Subsidiary of Delta Tucker Holdings, Inc. that directly owns 100% of the issued
and outstanding Equity

 

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Interests in the Borrower, and issues a Guaranty of the Obligations and agrees
to assume the obligations of “Holdings” pursuant to this Agreement and the other
Loan Documents pursuant to one or more instruments in form and substance
reasonably satisfactory to the Lender.

“Incur” means issue, assume, guarantee, incur or otherwise become liable for;
provided, however, that any Indebtedness or Capital Stock of a Person existing
at the time such Person becomes a Subsidiary (whether by merger, consolidation,
acquisition or otherwise) shall be deemed to be Incurred by such Person at the
time it becomes a Subsidiary.

“Indemnified Liabilities” has the meaning set forth in Section 8.8.

“Indemnitees” has the meaning set forth in Section 8.8.

“Indebtedness” means, with respect to any Person:

(1) the principal and premium (if any) of any Indebtedness of such Person,
whether or not contingent, (a) in respect of borrowed money, (b) evidenced by
bonds, notes, debentures or similar instruments or letters of credit or bankers’
acceptances (or, without duplication, reimbursement agreements in respect
thereof), (c) representing the deferred and unpaid purchase price of any
property, except any such balance that constitutes a trade payable or similar
obligation to a trade creditor due within six months from the date on which it
is Incurred, in each case Incurred in the ordinary course of business, which
purchase price is due more than six months after the date of placing the
property in service or taking delivery and title thereto, (d) in respect of
Capitalized Lease Obligations, or (e) representing any Hedging Obligations, if
and to the extent that any of the foregoing Indebtedness (other than letters of
credit and Hedging Obligations) would appear as a liability on a balance sheet
(excluding the footnotes thereto) of such Person prepared in accordance with
GAAP;

(2) to the extent not otherwise included, any obligation of such Person to be
liable for, or to pay, as obligor, guarantor or otherwise, on the Indebtedness
of another Person (other than by endorsement of negotiable instruments for
collection in the ordinary course of business); and

(3) to the extent not otherwise included, Indebtedness of another Person secured
by a Lien on any asset owned by such Person (whether or not such Indebtedness is
assumed by such Person); provided, however, that the amount of such Indebtedness
will be the lesser of: (a) the Fair Market Value of such asset at such date of
determination, and (b) the amount of such Indebtedness of such other Person;
provided that Contingent Obligations Incurred in the ordinary course of business
shall be deemed not to constitute Indebtedness.

“Intercreditor Agreement” means an intercreditor agreement substantially in the
form of Exhibit A (or otherwise reasonably satisfactory to the Lender) between
the Collateral Agent and one or more collateral agents or representatives for
the holders of debt issued by the Loan Parties, including the First Lien Credit
Agreement and the Second Lien Notes.

 

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“Interest Payment Date” means the last Business Day of each March, June,
September and December.

“Investment Grade Securities” means:

(1) securities issued or directly and fully guaranteed or insured by the U.S.
government or any agency or instrumentality thereof (other than Cash
Equivalents) and in each case with maturities not exceeding two years from the
date of acquisition,

(2) securities that have a rating equal to or higher than Baa3 (or the
equivalent) by Moody’s or BBB (or the equivalent) by S&P,

(3) investments in any fund that invests at least 95% of its assets in
investments of the type described in clauses (1) and (2) which fund may also
hold immaterial amounts of cash pending investment and/or distribution, and

(4) corresponding instruments in countries other than the United States
customarily utilized for high quality investments and in each case with
maturities not exceeding two years from the date of acquisition.

“Investments” means, with respect to any Person, all investments by such Person
in other Persons (including Affiliates) in the form of loans (including
guarantees), advances or capital contributions (excluding accounts receivable,
trade credit and advances to customers and commission, travel and similar
advances to officers, employees and consultants made in the ordinary course of
business), purchases or other acquisitions for consideration of Indebtedness,
Equity Interests or other securities issued by any other Person and investments
that are required by GAAP to be classified on the balance sheet of the Borrower
in the same manner as the other investments included in this definition to the
extent such transactions involve the transfer of cash or other property. For
purposes of the definition of “Unrestricted Subsidiary” and Section 4 under
Annex A:

(1) “Investments” shall include the portion (proportionate to the Borrower’s
equity interest in such Subsidiary) of the Fair Market Value of the net assets
of a Subsidiary of the Borrower at the time that such Subsidiary is designated
an Unrestricted Subsidiary; provided, however, that upon a redesignation of such
Subsidiary as a Restricted Subsidiary, the Borrower shall be deemed to continue
to have a permanent “Investment” in an Unrestricted Subsidiary equal to (if
positive):

(a) the Borrower’s “Investment” in such Subsidiary at the time of such
redesignation less

(b) the portion (proportionate to the Borrower’s equity interest in such
Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the
time of such redesignation; and

(2) any property transferred to or from an Unrestricted Subsidiary shall be
valued at its Fair Market Value at the time of such transfer, in each case as
determined in good faith by the Board of Directors of the Borrower.

 

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“Laws” means, collectively, all international, foreign, federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority.

“Lender” means (a) DynCorp Funding LLC, a Delaware limited liability company,
and (b) any assignee thereof, that has been assigned any or all of the rights or
obligations of the Lender pursuant to Section 8.06.

“Lender’s Office” means the address of the Lender specified in or determined in
accordance with the provisions of Section 8.01.

“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest or encumbrance of any kind in respect of such asset, whether
or not filed, recorded or otherwise perfected under applicable law (including
any conditional sale or other title retention agreement, any lease in the nature
thereof, any option or other agreement to sell or give a security interest in
and any filing of or agreement to give any financing statement under the Uniform
Commercial Code (or equivalent statutes) of any jurisdiction); provided that in
no event shall an operating lease be deemed to constitute a Lien.

“Loan” means an amount advanced by the Lender pursuant to Section 2.01.

“Loan Document Related Claim” means any claim or dispute (whether arising under
Applicable Law, under contract or otherwise) in any way arising out of, related
to, or connected with, the Loan Documents, the relationships established
thereunder or any actions or conduct thereunder or with respect thereto, whether
such claim or dispute arises or is asserted before or after the Closing Date or
before or after the Repayment Date.

“Loan Document Representation and Warranty” means any representation or warranty
made or deemed made under any Loan Document.

“Loan Documents” means, collectively, (i) this Agreement, (ii) any Notes,
(iii) the Collateral Documents, (iv) any other instrument or agreement now,
heretofore, or hereafter executed and delivered in connection herewith and
(v) any modification, restatement, replacement or supplement to any of the
foregoing.

“Loan Party” means collectively, the Borrower and each Guarantor.

“Management Investor” means any Person who is a director, officer or otherwise a
member of management of the Borrower, any of its Subsidiaries or any of its
direct or indirect parent companies on the Closing Date.

“Master Consulting and Advisory Services Agreement” means that certain Master
Consulting and Advisory Services Agreement, dated as of July 7, 2010, by and
between the Company and Cerberus Operations and Advisory Company LLC, together
with any specific engagement letters entered into from time to time, as
expressly contemplated thereunder (it being expressly understood that entering
into such specific engagement letters shall not be deemed to be an amendment to
the Master Consulting and Advisory Services Agreement).

 

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“Material Adverse Effect” means a material adverse effect on (a) the properties,
business, operations or financial condition of Holdings and its Subsidiaries,
taken as a whole, (b) the ability of the Loan Parties, taken as a whole, to
perform their obligations under the Loan Documents, (c) the legality, validity,
binding effect or enforceability against a Loan Party of a material Loan
Document to which it is a party or (d) the rights, remedies and benefits
available to, or conferred upon, the Lender or any Secured Party under any
material Loan Document.

“Material Contract” means any other contract or written agreement of any Loan
Party or any of its Subsidiaries (other than the Loan Documents) the failure to
comply with which could reasonably be expected to have a Material Adverse
Effect.

“Material Real Property” means any fee owned real property owned by the Borrower
or any Guarantor (other than any owned property subject to a Lien permitted by
clause (6)(A) of the definition of “Permitted Liens” to the extent and for so
long as the documentation governing such Lien prohibits the granting of a
mortgage thereon) with a fair market value in excess of $5.0 million (at the
Closing Date or, with respect to real property acquired after the Closing Date,
at the time of acquisition, in each case, as reasonably estimated by the
Borrower in good faith); provided that if at any time the fair market value of
all fee owned real properties that are not “Material Real Property” owned by the
Borrower and the Guarantors would exceed $5.0 million in the aggregate, the
Borrower and the Guarantors shall designate one or more additional fee owned
real properties as “Material Real Property” and comply with the Collateral and
Guarantee Requirement with respect thereto such that such threshold is no longer
exceeded.

“Maturity Date” means, June 15, 2026.

“Maximum Permissible Rate” means, with respect to interest payable on any
amount, the rate of interest on such amount that, if exceeded, could, under
Applicable Law, result in (a) civil or criminal penalties being imposed on the
payee or (b) the payee’s being unable to enforce payment of (or, if collected,
to retain) all or any part of such amount or the interest payable thereon.

“Moody’s” means Moody’s Investors Service, Inc. or any of its successors or
assigns that is a Nationally Recognized Statistical Rating Organization.

“Mortgages” means, collectively, the deeds of trust, trust deeds, hypothecs and
mortgages made by the Loan Parties in favor or for the benefit of the Collateral
Agent creating and evidencing a Lien on a pledged property, in form and
substance reasonably satisfactory to the Collateral Agent and the Borrower, and
any other mortgages executed and delivered pursuant to Section 19 under Annex A.

“Nationally Recognized Statistical Rating Organization” means a nationally
recognized statistical rating organization within the meaning of Rule 436 under
the Securities Act.

“Note” means any note in the form of Exhibit B.

 

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“Notice of Default” has the meaning set forth in Section 6.1.

“Obligations” means all advances to, and debts, liabilities, obligations,
covenants and duties of, any Loan Party and its Restricted Subsidiaries arising
under any Loan Document or otherwise with respect to this Agreement, whether
direct or indirect, absolute or contingent, due or to become due, now existing
or hereafter arising and including interest and fees that accrue after the
commencement by or against any Loan Party or Subsidiary of any proceeding under
any laws regarding debtor relief naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in
such proceeding.

“Offering Memorandum” means the Offering Memorandum and Consent Solicitation
Statement, dated as of May 2, 2016, in connection with the Borrower’s offer to
exchange all of its $455,000,000 principal amount of 10.375% Senior Notes due
2017 for $45,000,000 cash and 11.875% Senior Secured Second Lien Notes due 2020
and solicitation of consents in respect of its 10.375% Senior Notes due 2017.

“Participant Register” has the meaning set forth in Section 8.6(c).

“Permitted Asset Swap” means the concurrent purchase and sale or exchange of
Related Business Assets or a combination of Related Business Assets and cash or
Cash Equivalents between the Borrower or any of its Restricted Subsidiaries and
another Person.

“Permitted Debt” has the meaning set forth in Section 3(b) under Annex A.

“Permitted Holder” means (a) Cerberus Capital Management L.P. and its Affiliates
and any investment funds advised or managed by any of the foregoing (other than
any portfolio operating companies of Cerberus of which Cerberus or any
investment fund advised, managed or controlled by Cerberus or a combination
thereof does not own or control, directly or indirectly, more than 50% of both
the economic interests and total voting power of Equity Interests entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof at the time of determination), and
(b) the Management Investors.

“Permitted Investments” means:

(1) any Investment in Holdings or any Restricted Subsidiary;

(2) any (a) Investment in Cash Equivalents or (b) Investment Grade Securities in
an amount not to exceed $12.5 million at any one time outstanding; provided that
any such Investment Grade Securities, in the case of this clause (b), may not be
held by the Borrower or any Restricted Subsidiary for a period of longer than
six months;

(3) any Investment by Holdings or any Restricted Subsidiary of Holdings in a
Person that is primarily engaged in a Similar Business if as a result of such
Investment (a) such Person becomes a Restricted Subsidiary of Holdings, or
(b) such Person, in one transaction or a series of related transactions, is
merged, consolidated or amalgamated with or into, or transfers or conveys all or
substantially all of its assets to, or is liquidated into, Holdings or a
Restricted Subsidiary of Holdings;

 

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(4) any Investment in securities or other assets not constituting Cash
Equivalents and received in connection with an Asset Sale made pursuant to
Section 6 under Annex A or any other disposition of assets not constituting an
Asset Sale;

(5) any Investment (x) existing on the Closing Date, (y) made pursuant to
binding commitments in effect on the Closing Date and (z) that replaces,
refinances, refunds, renews or extends any Investment described under either of
the immediately preceding clauses (x) or (y), provided that any such Investment
is in an amount that does not exceed the amount replaced, refinanced, refunded,
renewed or extended;

(6) advances to employees not in excess of $6.25 million outstanding at any one
time in the aggregate;

(7) any Investment acquired by Holdings or any of its Restricted Subsidiaries
(a) in exchange for any other Investment or accounts receivable held by Holdings
or any such Restricted Subsidiary in connection with or as a result of a
bankruptcy, workout, reorganization or recapitalization of the issuer of such
other Investment or accounts receivable, or (b) as a result of a foreclosure by
Holdings or any of its Restricted Subsidiaries with respect to any secured
Investment or other transfer of title with respect to any secured Investment in
default;

(8) Hedging Obligations permitted under Section 4(b)(x) under Annex A;

(9) [reserved];

(10) additional Investments by Holdings or any of its Restricted Subsidiaries
having an aggregate Fair Market Value, taken together with all other Investments
made pursuant to this clause (10) that are at the time outstanding, not to
exceed $31.25 million;

(11) loans and advances to officers, directors and employees for
business-related travel expenses, moving and relocation expenses and other
similar expenses, in each case Incurred in the ordinary course of business;

(12) Investments the payment for which consists of Equity Interests of the
Borrower (other than Disqualified Stock), Holdings or any direct or indirect
parent of the Borrower, as applicable; provided, however, that such Equity
Interests will not increase the amount available for Restricted Payments under
Section 4 under Annex A;

(13) any transaction to the extent it constitutes an Investment that is
permitted by and made in accordance with Section 7(b) under Annex A (except
transactions described in clauses (ii), (iii), (v), (vi), (viii)(B), (xvi) and
(xviii) of such Section);

(14) Investments consisting of the licensing or contribution of intellectual
property pursuant to joint marketing arrangements with other Persons;

(15) guarantees issued in accordance with Sections 3 and 10 under Annex A;

 

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(16) any Investment by Restricted Subsidiaries of Holdings in other Restricted
Subsidiaries of Holdings and Investments by Subsidiaries that are not Restricted
Subsidiaries in other Subsidiaries that are not Restricted Subsidiaries of
Holdings;

(17) Investments consisting of purchases and acquisitions of inventory,
supplies, materials and equipment or purchases of contract rights or licenses or
leases of intellectual property, in each case in the ordinary course of
business;

(18) [reserved];

(19) Investments resulting from the receipt of non-cash consideration in an
Asset Sale received in compliance with Section 6 under Annex A;

(20) Investments in joint ventures of Holdings or any of its Restricted
Subsidiaries; provided that the greater of (i) the amount of such Investments
and (ii) the aggregate Fair Market Value of such Investments, in each case taken
together with all other Investments made pursuant to this clause (20) that are
at the time outstanding, shall not exceed $31.25 million; and

(21) Investments of a Restricted Subsidiary of Holdings acquired after the
Closing Date or of an entity merged into or consolidated with a Restricted
Subsidiary of Holdings in a transaction that is not prohibited by Section 21
under the Annex A after the Closing Date to the extent that such Investments
were not made in contemplation of such acquisition, merger or consolidation and
were in existence on the date of such acquisition, merger or consolidation.

“Permitted Liens” means with respect to any Person:

(1) pledges or deposits by such Person under workmen’s compensation laws,
unemployment insurance laws or similar legislation, or good faith deposits in
connection with bids, tenders, contracts (other than for the payment of
Indebtedness) or leases to which such Person is a party, or deposits to secure
public or statutory obligations of such Person or deposits of cash or U.S.
government bonds to secure surety or appeal bonds to which such Person is a
party, or deposits as security for contested taxes or import duties or for the
payment of rent, in each case Incurred in the ordinary course of business;

(2) Liens imposed by law, such as carriers’, warehousemen’s and mechanics’
Liens, in each case for sums not yet due or being contested in good faith by
appropriate proceedings or other Liens arising out of judgments or awards
against such Person with respect to which such Person shall then be proceeding
with an appeal or other proceedings for review (or which, if due and payable,
are being contested in good faith by appropriate proceedings and for which
adequate reserves are being maintained, to the extent required by GAAP and such
proceedings have the effect of preventing the forfeiture or sale of the property
or assets subject to any such Lien);

(3) Liens for taxes, assessments or other governmental charges (i) which are not
yet due or payable or (ii) which are being contested in good faith by
appropriate proceedings that have the effect of preventing the forfeiture or
sale of the property or assets subject to any such Lien and for which adequate
reserves are being maintained to the extent required by GAAP;

 

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(4) Liens in favor of issuers of performance and surety bonds or bid bonds or
with respect to other regulatory requirements or letters of credit issued
pursuant to the request of and for the account of such Person in the ordinary
course of its business;

(5) minor survey exceptions, minor encumbrances, easements or reservations of,
or rights of others for, licenses, rights-of-way, sewers, electric lines,
telegraph and telephone lines and other similar purposes, or zoning or other
restrictions as to the use of real properties or Liens incidental to the conduct
of the business of such Person or to the ownership of its properties which were
not Incurred in connection with Indebtedness and which do not in the aggregate
materially adversely affect the value of said properties or materially impair
their use in the operation of the business of such Person;

(6) (A) Liens Incurred by a Restricted Subsidiary that is not a Guarantor
securing Indebtedness of a Restricted Subsidiary that is not a Guarantor
permitted to be Incurred pursuant to Section 3 under Annex A and (B) Liens
Incurred to secure Obligations in respect of Indebtedness permitted to be
Incurred pursuant to clauses (i), (ii), (iii), (iv), (xii), (xx) or (xxii) of
Section 3(b) under Annex A (including Liens Incurred to secure obligations in
respect of the accrual of interest, accretion of accreted value or original
issue discount and the payment of interest or dividends in the form of
additional Indebtedness, Disqualified Stock or Preferred Stock, including in
respect of PIK Interest (as defined under the Second Lien Indenture as in effect
on the date hereof) on the Second Lien Notes and payment of payment in kind
interest under this Agreement); provided that, (x) in the case of clause (iv) of
Section 3(b) under Annex A, such Lien extends only to the assets and/or Capital
Stock, the acquisition, lease, construction, repair, replacement or improvement
of which is financed thereby and any income or profits thereof; and (y) in the
case of clause (xx) of Section 3(b) under Annex A, such Lien does not extend to
the property or assets (or income or profits therefrom) of any Restricted
Subsidiary other than a Foreign Subsidiary; and (z) in the case of clause
(xxii) of Section 3(b) under Annex A, such Liens do not secure the assets of
Holdings, the Borrower or any Subsidiary Guarantor;

(7) Liens existing on the Closing Date (other than Liens securing secured
parties under the First Lien Credit Agreement, the Second Lien Notes and this
Agreement);

(8) Liens on assets, property or shares of stock of a Person at the time such
Person becomes a Subsidiary; provided, however, that such Liens are not created
or Incurred in connection with, or in contemplation of, such other Person
becoming such a Subsidiary; provided, further, however, that such Liens may not
extend to any other property owned by the Borrower or any Restricted Subsidiary
of the Borrower;

(9) Liens on assets or on property at the time the Borrower or a Restricted
Subsidiary of the Borrower acquired the assets or property, including any
acquisition by means of a merger or consolidation with or into the Borrower or
any Restricted

 

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Subsidiary of the Borrower; provided, however, that such Liens are not created
or Incurred in connection with, or in contemplation of, such acquisition;
provided, further, however, that the Liens may not extend to any other assets or
property owned by the Borrower or any Restricted Subsidiary of the Borrower;

(10) [reserved];

(11) Liens securing Hedging Obligations so long as the related Indebtedness
(a) is, and is permitted under this Agreement to the extent described in
Section 3(b)(x), to be secured by a Lien on the same property securing such
Hedging Obligations and (b) does not exceed $25.0 million at any one time
outstanding;

(12) Liens on specific items of inventory or other goods and proceeds of any
Person securing such Person’s obligations in respect of bankers’ acceptances
issued or created for the account of such Person to facilitate the purchase,
shipment or storage of such inventory or other goods;

(13) leases and subleases of real property which do not materially interfere
with the ordinary conduct of the business of the Borrower or any of its
Restricted Subsidiaries;

(14) Liens arising from Uniform Commercial Code financing statement filings
regarding operating leases entered into by the Borrower and its Restricted
Subsidiaries in the ordinary course of business;

(15) Liens in favor of the Borrower or any Guarantor;

(16) [reserved];

(17) deposits made in the ordinary course of business to secure liability to
insurance carriers;

(18) [reserved];

(19) grants of software and other technology licenses in the ordinary course of
business;

(20) judgment and attachment Liens not giving rise to an Event of Default and
notices of lis pendens and associated rights related to litigation being
contested in good faith by appropriate proceedings and for which adequate
reserves have been made;

(21) Liens arising out of conditional sale, title retention, consignment or
similar arrangements for the sale of goods entered into in the ordinary course
of business;

(22) Liens Incurred to secure Cash Management Obligations (as defined under the
Second Lien Indenture as in effect on the date hereof) owed to a Credit
Agreement Lender (as defined under the Second Lien Indenture as in effect on the
date hereof) in the ordinary course of business, and Liens in respect of Secured
Hedging Obligations (as defined under the Second Lien Indenture as in effect on
the date hereof);

 

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(23) Liens on equipment of Holdings or any Restricted Subsidiary granted in the
ordinary course of business to Holdings or such Restricted Subsidiary’s client
at which such equipment is located;

(24) Liens to secure any refinancing, refunding, extension, renewal or
replacement (or successive refinancings, refundings, extensions, renewals or
replacements) as a whole, or in part, of any Indebtedness, as permitted under
the covenants under this Agreement, secured by any Lien referred to in the
foregoing clauses (6), (7), (8), (9), (11) and (15); provided, however, that
(x) such new Lien shall be limited to all or part of the same property that
secured the original Lien (plus improvements on such property), (y) the
Indebtedness secured by such Lien at such time is not increased to any amount
greater than the sum of (A) the outstanding principal amount or, if greater,
committed amount of the Indebtedness described under the foregoing clauses (6),
(7), (8), (9), (11) and (15) at the time the original Lien became a Permitted
Lien under this Agreement, plus any increase in the principal amount since the
original Lien became a Permitted Lien due to the accrual of interest, accretion
of accreted value or original issue discount and the payment of interest or
dividends in the form of additional Indebtedness, Disqualified Stock or
Preferred Stock, including in respect of PIK Interest (as defined under the
Second Lien Indenture as in effect on the date hereof) on the Second Lien Notes
and payment of payment in kind interest under this Agreement and (B) an amount
necessary to pay any fees and expenses, including premiums, related to such
refinancing, refunding, extension, renewal or replacement and (z) with respect
to Liens incurred to refinance Liens under the foregoing clause (7), the Lien
pursuant to such refinancing shall have the same relative priority as the Lien
being refinanced;

(25) [reserved];

(26) Liens arising under this Agreement in favor of the Collateral Agent for its
own benefit and similar Liens in favor of other trustees, agents and
representatives arising under instruments governing Indebtedness permitted to be
incurred or outstanding under this Agreement; provided that such Liens are
solely for the benefit of the trustees, agents and representatives in their
capacities as such and not for the benefit of the holders of such Indebtedness;
and

(27) other Liens securing Obligations in an amount not to exceed $18.75 million
at any one time outstanding.

In each case set forth above, notwithstanding any stated limitation on the
assets that may be subject to such Lien, a Permitted Lien on a specified asset
or group or type of assets may include Liens on all improvements, additions and
accessions thereto and all products and proceeds thereof, including dividends,
distributions, interest and increases in respect thereof.

 

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“Permitted Second Lien Obligations” means the Second Lien Notes and any
Indebtedness secured on a second-priority pari passu basis with the Second Lien
Notes and is a Permitted Lien.

“Person” means any individual, sole proprietorship, corporation, partnership,
trust, unincorporated organization, mutual company, joint stock company, estate,
union, employee organization, government or any agency or political subdivision
thereof.

“Post-Default Rate” means the rate otherwise applicable under Section 2.02(a)(i)
plus 2%.

“Preferred Stock” means any Equity Interest with preferential right of payment
of dividends or upon liquidation, dissolution or winding up.

“Program Specific Accounts” means deposit accounts and securities accounts not
located at a depositary bank in the United States directly related to foreign
programs operated by the Borrower and any Restricted Subsidiaries of the
Borrower.

“Projections” has the meaning set forth in Section 1(c) under Annex A.

“Property” means any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible, including,
without limitation, Equity Interests.

“Refinancing Indebtedness” has the meaning set forth in Section 3(b)(xiv) under
Annex A.

“Refinancing Transactions” means the transactions, including, without
limitation, the Exchange Offer, the amendment and refinancing of the First Lien
Credit Agreement to give effect to the extension of the revolving credit
facility and the new term loan facility, the conversion by certain revolving
credit lenders of revolving credit facility commitments under the First Lien
Credit Agreement into the new term loan facility, the waiver of the inclusion by
Holdings’ independent registered public accounting firm of an explanatory
paragraph in its audit report for the year ended December 31, 2015, regarding
the ability to continue as a going concern, and the incurrence of the Loans
under this Agreement, all contemplated by the Offering Memorandum.

“Refunding Capital Stock” has the meaning set forth in Section 4(b)(ii) under
Annex A.

“Register” has the meaning set forth in Section 8.6(c).

“Related Business Assets” means assets (other than cash or Cash Equivalents)
used or useful in a Similar Business; provided that any assets received by the
Borrower or a Restricted Subsidiary in exchange for assets transferred by the
Borrower or a Restricted Subsidiary will not be deemed to be Related Business
Assets if they consist of securities of a Person, unless upon receipt of the
securities of such Person, such Person would become a Restricted Subsidiary.

 

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“Repayment Date” means the later of (a) the termination of this Agreement and
(b) the payment in full of the Loans and all other amounts payable or accrued
hereunder (other than in respect of contingent indemnification and expense
reimbursement obligations for which no claims has been made).

“Responsible Officer” means the chief executive officer, president, vice
president, chief financial officer, treasurer or assistant treasurer or other
similar officer of a Loan Party and, as to any document delivered on the Closing
Date or any effective date of any amendment to the Loan Documents, any secretary
or assistant secretary of such Loan Party. Any document delivered hereunder that
is signed by a Responsible Officer of a Loan Party shall be conclusively
presumed to have been authorized by all necessary corporate, partnership and/or
other action on the part of such Loan Party and such Responsible Officer shall
be conclusively presumed to have acted on behalf of such Loan Party.

“Restricted Investment” means an Investment other than a Permitted Investment.

“Restricted Payment” has the meaning set forth in Section 4(a) under Annex A.

“Restricted Subsidiary” means with respect to any Person, any Subsidiary of such
Person other than an Unrestricted Subsidiary of such Person. Unless otherwise
indicated in this Agreement or the context otherwise requires, all references to
Restricted Subsidiaries shall mean Restricted Subsidiaries of Holdings,
including the Borrower.

“Retired Capital Stock” has the meaning set forth in Section 4(b)(ii) under
Annex A.

“S&P” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial
Services LLC business, or any of its successors or assigns that is a Nationally
Recognized Statistical Rating Organization.

“Sale/Leaseback Transaction” means an arrangement relating to property now owned
or hereafter acquired by the Borrower or a Restricted Subsidiary whereby the
Borrower or a Restricted Subsidiary transfers such property to a Person and the
Borrower or such Restricted Subsidiary leases it from such Person, other than
leases between the Borrower and a Restricted Subsidiary of the Borrower or
between Restricted Subsidiaries of the Borrower.

“SEC” means the Securities and Exchange Commission.

“Second Lien Collateral Agent” means individually and/or collectively,
(i) Wilmington Trust, National Association, in its capacity as collateral agent
under the Second Lien Indenture, together with its successors in such capacity
and (ii) any Person elected, designated or appointed as the administrative
agent, trustee, collateral agent or similar representative with respect to
documents evidencing any Permitted Second Lien Obligations.

“Second Lien Indenture” means that certain indenture, dated as of June 15, 2016,
among DynCorp International Inc., as issuer and Wilmington Trust, National
Association, as trustee and collateral agent.

 

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“Second Lien Notes” means the 11.875% Senior Secured Second Lien Notes due 2020
issued under the Second Lien Indenture.

“Secured Indebtedness” means any Indebtedness secured by a Lien.

“Secured Party” means the Collateral Agent and any Lender.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the SEC promulgated thereunder.

“Security Agreement” means a security agreement substantially in the form of
Exhibit C.

“Senior Debt Documents” means, collectively, the documents related to the First
Lien Credit Agreement and the Second Lien Notes.

“Senior Notes” means the 10.375% senior notes due 2017 issued by the Borrower.

“Significant Subsidiary” means any Restricted Subsidiary that would be a
“Significant Subsidiary” of the Borrower within the meaning of Rule 1-02 under
Regulation S-X promulgated by the SEC.

“Similar Business” means any business engaged in by the Borrower or any of its
Restricted Subsidiaries on the Closing Date and any business or other activities
that are reasonably similar, ancillary, complementary or related to, or a
reasonable extension, development or expansion of, the businesses in which the
Borrower and its Restricted Subsidiaries are engaged on the Closing Date.

“Solvent” and “Solvency” mean, when used with respect to any Person, that, as of
any date of determination, (a) the amount of the “fair saleable value” of the
assets of such Person will, as of such date, exceed (i) the value of all
“liabilities of such Person, including contingent and other liabilities,” as of
such date, as such quoted terms are generally determined in accordance with
applicable Laws governing determinations of the insolvency of debtors, and
(ii) the amount that will be required to pay the probable liabilities of such
Person on its existing debts (including contingent and other liabilities) as
such debts become absolute and mature, (b) such Person will not have, as of such
date, an unreasonably small amount of capital for the operation of the
businesses in which it is engaged as of such date and (c) such Person will be
able to pay its liabilities, including contingent and other liabilities, as they
mature. For purposes of this definition, “not have an unreasonably small amount
of capital for the operation of the businesses in which it is engaged” means
that such Person will be able to generate enough cash from operations, asset
dispositions or refinancing, or a combination thereof, to meet its obligations
as they become due.

“Specified Gulf States” means Saudi Arabia, Kuwait, Qatar, Oman, Bahrain, and
the United Arab Emirates.

“Sponsor” means (1) Cerberus Capital Management L.P. and (2) one or more of its
Affiliates and any investment funds advised or managed by any of the foregoing
(other than any portfolio operating companies of Cerberus of which Cerberus or
an investment fund advised,

 

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managed or controlled by Cerberus or a combination thereof does not own or
control, directly or indirectly, more than 50% of both the economic interests
and total voting power of Equity Interests entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof at the time of determination).

“Stated Maturity” means, with respect to any security, the date specified in
such security as the fixed date on which the final payment of principal of such
security is due and payable, including pursuant to any mandatory redemption
provision (but excluding any provision providing for the repurchase of such
security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has
occurred).

“Subordinated Indebtedness” means (a) with respect to the Borrower, any
Indebtedness of the Borrower which is by its terms subordinated in right of
payment to the Loans and (b) with respect to any Guarantor, any Indebtedness of
such Guarantor which is by its terms subordinated in right of payment to its
Guaranteed Obligations, in each case, whether outstanding on the Closing Date or
thereafter Incurred.

“Subsidiary” means, with respect to any Person (1) (a) any corporation,
association or other business entity (other than a partnership, joint venture or
limited liability company) of which more than 50% of the total voting power of
shares of Capital Stock entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time of determination owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of that Person or a
combination thereof or (b) any partnership, joint venture or limited liability
company of which (x) more than 50% of the capital accounts, distribution rights,
total equity and voting interests or general and limited partnership interests,
as applicable, are owned or controlled, directly or indirectly, by such Person
or one or more of the other Subsidiaries of that Person or a combination
thereof, whether in the form of membership, general, special or limited
partnership interests or otherwise, and (y) such Person or any Restricted
Subsidiary of such Person is a controlling general partner or otherwise controls
such entity and (2) any Person that is consolidated in the consolidated
financial statements of the specified Person in accordance with GAAP. Unless
otherwise specified, all references herein to a “Subsidiary” or to
“Subsidiaries” shall refer to a Subsidiary or Subsidiaries of Holdings.

“Subsidiary Guarantor” means any Guarantor other than Holdings.

“Successor Company” has the meaning set forth in Section 21 under Annex A.

“Supplemental Agent” has the meaning set forth in Section 9.10.

“Support Agreement” means the support agreement dated April 30, 2016 between
Holdings, the Borrower and certain holders of the Senior Notes relating to the
Exchange Offer.

“Tax” means any Federal, State or foreign tax, assessment or other governmental
charge (including any withholding tax) upon a Person or upon its assets,
revenues, income or profits.

 

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“Total Assets” means the total consolidated assets of the Borrower and its
Restricted Subsidiaries, as shown on the most recent consolidated balance sheet
of the Borrower and its Restricted Subsidiaries.

“Uniform Commercial Code” or “UCC” means the Uniform Commercial Code as the same
may from time to time be in effect in the State of New York or the Uniform
Commercial Code (or similar code or statute) of another jurisdiction, to the
extent it may be required to apply to any item or items of Collateral.

“United States” means the United States of America.

“Unrestricted Subsidiary” means:

(1) Global Linguist Solutions, LLC;

(2) any Subsidiary of the Borrower that at the time of determination shall be
designated an Unrestricted Subsidiary by the Board of Directors of such Person
in the manner provided below; and

(3) any Subsidiary of an Unrestricted Subsidiary.

The Board of Directors of Holdings may designate any Subsidiary of Holdings
(including any newly acquired or newly formed Subsidiary of Holdings but
excluding the Borrower) to be an Unrestricted Subsidiary unless such Subsidiary
or any of its Subsidiaries owns any Equity Interests or Indebtedness of, or owns
or holds any Lien on any property of, Holdings or any other Subsidiary of
Holdings that is not a Subsidiary of the Subsidiary to be so designated;
provided, however, that the Subsidiary to be so designated and its Subsidiaries
do not at the time of designation have and do not thereafter Incur any
Indebtedness pursuant to which the lender has recourse to any of the assets of
Holdings or any of its Restricted Subsidiaries; provided, further, however, that
either:

(a) the Subsidiary to be so designated has total consolidated assets of $1,000
or less; or

(b) if such Subsidiary has consolidated assets greater than $1,000, then such
designation would be permitted under Section 4 under Annex A.

The Board of Directors of Holdings may designate any Unrestricted Subsidiary to
be a Restricted Subsidiary; provided, however, that immediately after giving
effect to such designation:

(x) (1) the Fixed Charge Coverage Ratio for the Borrower and its Restricted
Subsidiaries for the most recently ended four full fiscal quarters for which
financial statements are available immediately preceding the date of such
transaction would have been at least 2.00 to 1.00, or (2) the Fixed Charge
Coverage Ratio for the Borrower and its Restricted Subsidiaries would be greater
than such ratio for the Borrower and its Restricted Subsidiaries immediately
prior to such designation, in each case on a pro forma basis taking into account
such designation, and

 

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(y) no Event of Default shall have occurred and be continuing.

Any such designation by the Board of Directors of Holdings shall be evidenced to
the Lender by promptly filing with the Lender copy of the resolution of the
Board of Directors of Holdings giving effect to such designation and an
officer’s certificate certifying that such designation complied with the
foregoing provisions.

“Unsecured Indebtedness” means Indebtedness that is not Secured Indebtedness.

“Weighted Average Life to Maturity” means, when applied to any Indebtedness or
Disqualified Stock, as the case may be, at any date, the quotient obtained by
dividing (1) the sum of the products of the number of years from the date of
determination to the date of each successive scheduled principal payment of such
Indebtedness or redemption or similar payment with respect to such Disqualified
Stock multiplied by the amount of such payment, by (2) the sum of all such
payments.

“Wholly Owned Restricted Subsidiary” is any Wholly Owned Subsidiary that is a
Restricted Subsidiary.

“Wholly Owned Subsidiary” of any Person means a Subsidiary of such Person 100%
of the outstanding Capital Stock or other ownership interests of which (other
than directors’ qualifying shares or shares or interests required to be held by
foreign nationals or other third parties to the extent required by applicable
law) shall at the time be owned by such Person or by one or more Wholly Owned
Subsidiaries of such Person and one or more Wholly Owned Subsidiaries of such
Person.

Section 1.2 Other Interpretive Provisions. For the purposes hereof and as used
herein, except as otherwise specified, (a) references to any Person include its
successors and assigns and, in the case of any governmental authority, any
Person succeeding to its functions and capacities; (b) references to any
Applicable Law include amendments, supplements and successors thereto;
(c) references to organizational documents, any agreements (including the Loan
Documents) and other contractual instruments shall be deemed to include all
amendments, amendments and restatements, restatements, extensions, supplements,
waivers and other modifications thereto (and, in the case of instruments,
instruments issued in substitution therefor); (d) references to specific
sections, articles, annexes, schedules and exhibits are to this Agreement;
(e) words importing gender include the other gender; (f) the singular includes
the plural and the plural includes the singular; (g) the words “including”,
“include” and “includes” shall be deemed followed by the words “without
limitation”; (h) each authorization herein shall be deemed irrevocable and
coupled with an interest; (i) all accounting terms shall be interpreted, and all
determinations relating thereto shall be made, in accordance with GAAP;
(j) captions and headings are for ease of reference only and shall not affect
the construction hereof; and (k) references to any time of day shall be to New
York time.

 

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ARTICLE II

CREDIT FACILITY

Section 2.1 Loans. Subject to the terms and conditions hereof, the Lender agrees
to make, on the Closing Date, a term loan to the Borrower in an aggregate
principal amount equal to $30,000,000. Amounts borrowed under this Section 2.01
and repaid or prepaid may not be reborrowed.

Section 2.2 Interest.

(a) Rates.

(i) Subject to Section 2.02(a)(ii), each Loan shall bear interest on the
outstanding principal amount thereof at a rate per annum equal to 5.00%, payable
on each Interest Payment Date after the date hereof. Accrued interest shall be
paid in kind by being added to the principal amount of the Loans on each
Interest Payment Date.

(ii) If all or any part of a Loan or any other amount due and payable under the
Loan Documents is not paid when due (whether at maturity, by reason of notice of
prepayment or acceleration or otherwise), such unpaid amount shall, to the
maximum extent permitted by Applicable Law, bear interest for each day during
the period from the date such amount became so due until it shall be paid in
full (whether before or after judgment) at a rate per annum equal to the
Post-Default Rate.

(b) Payment. Interest in respect of each Loan shall be payable in cash in
Dollars on (i) the Maturity Date and (ii) any other date on which the Loans or
any portion thereof shall be due (whether by reason of notice of prepayment or
acceleration or otherwise), but only to the extent then accrued on the amount
then so due. Interest at the Post-Default Rate shall be payable on demand.

(c) Maximum Interest Rate. Nothing contained in the Loan Documents shall require
the Borrower at any time to pay interest at a rate exceeding the Maximum
Permissible Rate. If interest payable by the Borrower on any date would exceed
the maximum amount permitted by the Maximum Permissible Rate, such interest
payment shall automatically be reduced to such maximum permitted amount, and
interest for any subsequent period, to the extent less than the maximum amount
permitted for such period by the Maximum Permissible Rate, shall be increased by
the unpaid amount of such reduction. Any interest actually received for any
period in excess of such maximum amount permitted for such period shall be
deemed to have been applied as a prepayment of the Loans.

Section 2.3 Repayment. Each of the Loans shall mature and become due and
payable, and shall be repaid by the Borrower, in full on the Maturity Date.

Section 2.4 Prepayments. Subject to the Intercreditor Agreement, the Borrower
may, at any time and from time to time, prepay the Loans in whole or in part,
without premium or penalty, except that any partial prepayment shall be in an
aggregate principal amount of $500,000 or any integral multiple of $500,000 in
excess thereof. The Borrower shall give the Lender notice of each prepayment
pursuant to this Section 2.04 no later than 10:00 a.m. on the third Business Day
before the date of such prepayment. Each such notice of prepayment shall

 

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specify (i) the date such prepayment is to be made and (ii) the amount of the
portion of the Loans to be prepaid. Amounts to be prepaid pursuant to this
Section 2.04 shall irrevocably be due and payable on the date specified in the
applicable notice of prepayment, together with interest thereon as provided in
Section 2.02(b).

Section 2.5 Computation of Interest. Interest shall be computed on the basis of
a year of 360 days and the actual number of days elapsed. Interest for any
period shall be calculated from and including the first day thereof to but
excluding the last day thereof.

Section 2.6 Evidence of Indebtedness. The Loans and the Borrower’s obligation to
repay the Loans with interest in accordance with the terms of this Agreement
shall be evidenced by this Agreement, the records of the Lender and a single
Note. The records of the Lender shall be prima facie evidence of the Loans and
accrued interest thereon and of all payments made in respect thereof.

Section 2.7 Payments by the Borrower.

(a) Time, Place and Manner. All payments due to the Lender under the Loan
Documents shall be made to the Lender at the Lender’s Office or at such other
address as the Lender may designate by notice to the Borrower. A payment shall
not be deemed to have been made on any day unless such payment has been received
by the Lender, at the required place of payment, in Dollars in funds immediately
available to the Lender at such place, no later than 12:00 noon on such day.

(b) No Reductions. All payments due to the Lender under the Loan Documents shall
be made by the Borrower without any reduction or deduction whatsoever, including
any reduction or deduction for any set-off, recoupment, counterclaim or Tax.

(c) Extension of Payment Dates. Whenever any payment to the Lender under the
Loan Documents would otherwise be due (except by reason of acceleration) on a
day that is not a Business Day such payment shall instead be due on the next
succeeding Business Day, as the case may be. If the date any payment under the
Loan Documents is due is extended (whether by operation of any Loan Document,
Applicable Law or otherwise), such payment shall bear interest for such extended
time at the rate of interest applicable hereunder.

ARTICLE III

CONDITIONS TO LOANS

Section 3.1 Conditions to Loans. The obligation of the Lender to make the Loan
is subject to the determination by the Lender, in its sole and absolute
discretion, that each of the following conditions has been fulfilled prior to
the making of such Loan:

(a) this Agreement shall have been duly executed and delivered by the Borrower
and each Guarantor;

(b) the Lender shall have received any requested duly executed Note;

 

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(c) the Security Agreement shall have been duly executed and delivered by each
Loan Party that is to be a party thereto, together with documents and
instruments to be recorded or filed that the Lender may deem reasonably
necessary to satisfy the Collateral and Guarantee Requirement;

(d) the Collateral Agent and Lender shall have received all fees and expenses
required to be paid, under Section 8.07 to the extent invoiced two (2) Business
Days prior to the Closing Date;

(e) the Lender shall have received a certificate of a Responsible Officer of the
Borrower dated as of the Closing Date certifying (a) each Loan Document
Representation and Warranty shall be true and correct at and as of the time the
Loan is to be made, (b) that no Default shall have occurred and be continuing,
(c) that the Exchange Offer and consent solicitation for the Senior Notes shall
have been consummated or, substantially simultaneously with the borrowing
hereunder, shall be consummated in accordance with the terms of the Offering
Memorandum and the Support Agreement, (d) that Amendment No. 5 Effective Date
(as defined under Amendment No. 5 and Waiver to the First Lien Credit Agreement)
shall have occurred, or substantially simultaneously with the borrowing
hereunder, shall have occurred in accordance with the terms of Amendment No. 5
and Waiver to the First Lien Credit Agreement and (e) that all other conditions
hereunder and contemplated under the Exchange Offer, the Offering Memorandum and
the Support Agreement have been satisfied.

(f) the Lender shall have received (i) a copy of the certificate or articles of
incorporation or organization, including all amendments thereto, of each Loan
Party, certified, if applicable, as of a recent date by the Secretary of State
of the state of its organization, and a certificate as to the good standing
(where relevant) of each Loan Party as of a recent date, from such Secretary of
State or similar Governmental Authority and (ii) a certificate of a Responsible
Officer of each Loan Party dated as of the Closing Date and certifying (A) that
attached thereto is a true and complete copy of the by-laws or operating (or
limited liability company) agreement of such Loan Party as in effect on the
Closing Date, (B) that attached thereto is a true and complete copy of
resolutions duly adopted by the board of directors (or equivalent governing
body) of such Loan Party authorizing the execution, delivery and performance of
the Loan Documents to which such Person is a party and, in the case of the
Borrower, the borrowings thereunder, and that such resolutions have not been
modified, rescinded or amended and are in full force and effect, and (C) as to
the incumbency and specimen signature of each officer executing any Loan
Document on behalf of such Loan Party and countersigned by another officer as to
the incumbency and specimen signature of a Responsible Officer executing the
certificate pursuant to clause (ii) above;

(g) the Lender shall have received perfection certificate dated as of the
Closing Date;

(h) the Lender shall have received a legal opinion of (i) Akin Gump Strauss
Hauer & Feld LLP, counsel to the Loan Parties, (ii) Holland & Knight LLP,
Virginia counsel to the Loan Parties, (iii) Fennemore Craig, P.C., Nevada
counsel to the Loan Parties, and (iv) Wilkerson & Bryan, P.C., Alabama counsel
to the Loan Parties, in each case, as to such matters as the Lender may
reasonably request;

 

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(i) the Collateral Agent shall have received evidence of the insurance coverage
required by the Collateral Documents, with such endorsements as to the named
insureds or loss payees thereunder as the Collateral Agent may request and
providing that each such policy may be terminated or canceled (by the insurer or
the insured thereunder) only upon 30 days’ prior written notice to the
Collateral Agent and each such named insured or loss payee;

(j) the Lender shall have received a certificate in form and substance
reasonably satisfactory to the Lender, dated as of the Closing Date and signed
by the Chief Financial Officer of Holdings and the Borrower, certifying that
Holdings, the Borrower and their Subsidiaries, on a consolidated basis after
giving effect to the transactions contemplated on the Closing Date, are Solvent
as of the Closing Date;

(k) The Intercreditor Agreement shall have been duly executed and delivered by
each of the parties thereto;

(l) Since January 1, 2016 there shall not have occurred a Material Adverse
Effect or any changes, events, circumstances, occurrences, effects or
developments that would reasonably be likely to have, individually or in the
aggregate, a Material Adverse Effect.

(m) No more than $45,500,000 (or such other amount acceptable to the Lender) of
Senior Notes shall be outstanding as of the Closing Date and the Exchange Offer
shall have been consummated or, substantially simultaneously with the borrowing
of the Loans, shall be consummated in accordance with the terms of the Offering
Memorandum and the Support Agreement;

(n) each Loan Document Representation and Warranty shall be true and correct at
and as of the time the Loan is to be made;

(o) no Default shall have occurred and be continuing at the time the Loan is to
be made or would result from the making of the Loan or from the application of
the proceeds thereof; and

(p) the Loan will not contravene any Applicable Law applicable to the Lender.

The Borrower shall be deemed to have represented and warranted to the Lender and
Collateral Agent at the time of the making of the Loan that the conditions
specified above have been fulfilled.

ARTICLE IV

CERTAIN REPRESENTATIONS AND WARRANTIES

In order to induce the Lender to enter into this Agreement and to make the
Loans, each Loan Party represents and warrants as follows, which representations
and warranties shall be deemed to be made on the Closing Date (both with and
without giving effect to such Loan):

 

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Section 4.1 Organization; Power; Qualification. Each Loan Party and each
Subsidiary thereof is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation, has the
power and authority to own its Properties and to carry on its business as now
being and hereafter proposed to be conducted and is duly qualified and
authorized to do business in each jurisdiction in which the character of its
Properties or the nature of its business requires such qualification and
authorization except in jurisdictions where the failure to be so qualified or in
good standing could not reasonably be expected to result in a Material Adverse
Effect.

Section 4.2 Authorization; Enforceability. Each Loan Party and each Subsidiary
thereof has the right, power and authority and has taken all necessary corporate
and other action to authorize the execution, delivery and performance of this
Agreement and each of the other Loan Documents to which it is a party in
accordance with their respective terms. This Agreement and each of the other
Loan Documents have been duly executed and delivered by the duly authorized
officers of each Loan Party and each Subsidiary thereof that is a party thereto,
and each such document constitutes the legal, valid and binding obligation of
each Loan Party and each Subsidiary thereof that is a party thereto, enforceable
in accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar state or federal
Debtor Relief Laws from time to time in effect which affect the enforcement of
creditors’ rights in general and the availability of equitable remedies.

Section 4.3 Litigation. Except for matters existing on the Closing Date and set
forth on Schedule 4.3, there are no actions, suits, investigations or
proceedings pending nor, to the knowledge of the Borrower, threatened against or
in any other way relating adversely to or affecting any Loan Party or any
Subsidiary thereof or any of their respective properties in any court or before
any arbitrator of any kind or before or by any Governmental Authority that has
or could reasonably be expected to have, individually, a Material Adverse
Effect.

Section 4.4 Ownership. Each Subsidiary of each Loan Party as of the Closing Date
is listed on Schedule 4.4. As of the Closing Date, the capitalization of each
Loan Party and its Subsidiaries consists of the number of shares or other equity
interests, authorized, issued and outstanding, of such classes and series, with
or without par value, described on Schedule 4.4. All shares or other equity
interests outstanding as of the Closing Date have been duly authorized and
validly issued and are fully paid and nonassessable, with no personal liability
attaching to the ownership thereof, and not subject to any preemptive or similar
rights, except as described in Schedule 4.4. The shareholders or other owners,
as applicable, of each Loan Party and its Subsidiaries and the number of shares
or other equity interests owned by each as of the Closing Date are described on
Schedule 4.4. As of the Closing Date, there are no outstanding stock purchase
warrants, subscriptions, options, securities, instruments or other rights of any
type or nature whatsoever, which are convertible into, exchangeable for or
otherwise provide for or permit the issuance of Equity Interests of any Loan
Party or any Subsidiary thereof, except as described on Schedule 4.4.

Section 4.5 Absence of Defaults. No event has occurred or is continuing
(i) which constitutes a Default or an Event of Default, or (ii) which
constitutes, or which with the passage of time or giving of notice or both would
constitute, a default or event of default by any Loan Party or any Subsidiary
thereof under any Material Contract or judgment, decree or order to

 

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which any Loan Party or any Subsidiary thereof is a party or by which any Loan
Party or any Subsidiary thereof or any of their respective properties may be
bound or which would require any Loan Party or any Subsidiary thereof to make
any payment thereunder prior to the scheduled maturity date therefor that, in
any case under this clause (ii), could, either individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. (A) No Loan Party or
any Subsidiary thereof has been debarred or suspended from any contracting with
the United States government, (B) a final decision of debarment or a final
decision of suspension has not been issued to any Loan Party or any Subsidiary
thereof and (C) the actual termination for default of any Material Contract has
not been issued to or received by any Loan Party or any Subsidiary thereof.

Section 4.6 Compliance of Agreement, Loan Documents and Borrowing with Laws,
Etc. The execution, delivery and performance by each Loan Party of the Loan
Documents to which each such Person is a party, in accordance with their
respective terms, the Loans hereunder and the transactions contemplated hereby
do not and will not, by the passage of time, the giving of notice or otherwise,
(i) require any Governmental Approval or violate any Applicable Law relating to
any Loan Party where the failure to obtain such Governmental Approval or such
violation could reasonably be expected to have a Material Adverse Effect,
(ii) conflict with, result in a breach of or constitute a default under the
articles of incorporation, bylaws or other organizational documents of any Loan
Party, (iii) conflict with, result in a breach of or constitute a default under
any indenture, agreement or other instrument to which such Person is a party or
by which any of its properties may be bound or any Governmental Approval
relating to such Person, which could reasonably be expected to have a Material
Adverse Effect or as set forth on Schedule 4.6, (iv) result in or require the
creation or imposition of any Lien upon or with respect to any property now
owned or hereafter acquired by such Person other than Liens arising under the
Loan Documents or (v) require any consent or authorization of, filing with, or
other act in respect of, an arbitrator or Governmental Authority or any other
Person other than (A) consents, authorizations, filings or other acts or
consents for which the failure to obtain or make could not reasonably be
expected to have a Material Adverse Effect, (B) consents or filings under the
UCC, (C) filings with the United States Copyright Office and/or the United
States Patent and Trademark Office and (D) as may be required with respect to
vehicles registered under a certificate of title.

Section 4.7 Compliance with Law; Governmental Approvals. Each Loan Party and
each Subsidiary thereof (i) has all Governmental Approvals required by any
Applicable Law for it to conduct its business, each of which is in full force
and effect, is final and not subject to review on appeal and is not the subject
of any pending or, to the best of its knowledge, threatened attack by direct or
collateral proceeding, (ii) is in compliance with each Governmental Approval
applicable to it and in compliance with all other Applicable Laws relating to it
or any of its respective properties and (iii) has timely filed all material
reports, documents and other materials required to be filed by it under all
Applicable Laws with any Governmental Authority and has retained all material
records and documents required to be retained by it under Applicable Law except
in each case (i), (ii) or (iii) where the failure to have, comply or file could
not reasonably be expected to have a Material Adverse Effect.

Section 4.8 Margin Stock. No Loan Party nor any Subsidiary thereof is engaged
principally or as one of its activities in the business of extending credit for
the purpose of

 

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“purchasing” or “carrying” any “margin stock” (as each such term is defined or
used, directly or indirectly, in Regulation U of the Board of Governors of the
Federal Reserve System). No part of the proceeds of any of the Loans or Letters
of Credit will be used for purchasing or carrying margin stock or for any
purpose which violates, or which would be inconsistent with, the provisions of
Regulation T, U or X of such Board of Governors. If requested by the Lender,
Holdings will furnish to the Lender a statement to the foregoing effect in
conformity with the requirements of FR Form G-3 or FR Form U-1 referred to in
Regulation U.

Section 4.9 Government Regulation. No Loan Party nor any Subsidiary thereof is
an “investment company” (as such term is defined or used in the Investment
Company Act of 1940, as amended) nor is any Loan Party or any Subsidiary thereof
“controlled” by an “investment company” that is required to register under the
Investment Company Act of 1940, as amended, and no Loan Party nor any Subsidiary
thereof is, or after giving effect to any Credit Extensions will be, subject to
regulation under the Interstate Commerce Act, as amended, or any other
Applicable Law which limits its ability to incur or consummate the transactions
contemplated hereby.

Section 4.10 Collateral Documents.

(a) Valid Liens. Each Collateral Document delivered on the Closing Date will,
upon execution and delivery thereof, be effective to create in favor of the
Secured Party, legal, valid and enforceable Liens on, and security interests in,
the Collateral described therein to the extent intended to be created thereby
and (i) when financing statements and other filings in appropriate form are
filed in the appropriate offices and (ii) upon the taking of possession or
control by the Secured Party of such Collateral with respect to which a security
interest may be perfected only by possession or control (which possession or
control shall be given to the Secured Party to the extent possession or control
by the Secured Party is required by the Security Agreement and Intercreditor
Agreement), the Liens created by the Collateral Documents shall constitute fully
perfected Liens on, and security interests in (to the extent intended to be
created thereby), all right, title and interest of the grantors in such
Collateral to the extent perfection can be obtained by filing financing
statements, in each case subject to no Liens other than Liens permitted
hereunder.

(b) PTO Filing; Copyright Office Filing. When the Security Agreement or a short
form thereof is properly filed in the United States Patent and Trademark Office
and the United States Copyright Office, to the extent such filings may perfect
such interests, the Liens created by such Security Agreement shall constitute
fully perfected Liens on, and security interests in, all right, title and
interest of the grantors thereunder in Patents and Trademarks (each as defined
in the Security Agreement) registered or applied for with the United States
Patent and Trademark Office or Copyrights (as defined in such Security
Agreement) registered or applied for with the United States Copyright Office, as
the case may be, in each case free and clear of Liens other than Liens permitted
hereunder (it being understood that subsequent recordings in the United States
Patent and Trademark Office and the United States Copyright Office may be
necessary to establish a Lien on registered Patents, Trademarks and Copyrights
registered or applied for by the grantors thereof after the Closing Date).

 

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(c) Notwithstanding anything herein (including this Section 4.10) or in any
other Loan Document to the contrary, neither the Borrower nor any other Loan
Party makes any representation or warranty as to (A) the effects of perfection
or non-perfection, the priority or the enforceability of any pledge of or
security interest in any Equity Interests of any Foreign Subsidiary, or as to
the rights and remedies of the Collateral Agent with respect thereto, under
foreign Law, (B) the pledge or creation of any security interest, or the effects
of perfection or non-perfection, the priority or the enforceability of any
pledge of or security interest to the extent such pledge, security interest,
perfection or priority is not required pursuant to the Collateral Documents or
(C) on the Closing Date, the pledge or creation of any security interest, or the
effects of perfection or non-perfection, the priority or enforceability of any
pledge or security interest to the extent not required on the Closing Date
pursuant to the Security Agreement.

Section 4.11 Use of Proceeds. The proceeds of the Loans shall be used solely to
pay fees and expenses (including reimbursement of out-of-pocket expenses) in
support of or related to members of the Global Advisory Group until the date
that is two (2) years after the Closing Date and, thereafter, for working
capital, general corporate purposes and any other purpose not prohibited by this
Agreement.

ARTICLE V

CERTAIN COVENANTS

From the Closing Date and until the Repayment Date, Holdings, the Borrower and
each other Loan Party shall, and shall cause each of the Restricted Subsidiaries
to, comply with the covenants set forth in Annex A hereto.

ARTICLE VI

DEFAULT

Section 6.1 Events of Default. Each of the following shall constitute an Event
of Default, whatever the reason for such event and whether it shall be voluntary
or involuntary, or within or without the control of the Loan Parties, or be
effected by operation of law or pursuant to any judgment or order of any court
or any order, rule or regulation of any governmental or nongovernmental body:

(a) the Borrower defaults in any payment of interest on any Loan or Note when
the same becomes due and payable, and such default continues for a period of 30
days;

(b) the Borrower defaults in the payment of principal or premium, if any, of any
Loan or Note when due at its Stated Maturity, upon optional repayment, upon
required repayment, upon declaration or otherwise;

(c) the Borrower fails to comply with its obligations under Section 20 of Annex
A;

(d) (i) the Borrower or any of its Restricted Subsidiaries fails to comply with
any of its obligations under the covenants set forth in Section 8 of Annex A
(other than a failure

 

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to repay when required under Section 8 of Annex A, which shall constitute an
Event of Default under clause (b) above) and such failure continues for 30 days
after receipt of a related Notice of Default as specified below or (ii) the
Borrower or any of its Restricted Subsidiaries fails to comply with any of its
obligations under the covenants set forth in Section 4 of Annex A and such
failure continues for five days after receipt of a related Notice of Default as
specified below

(e) the Borrower or any of its Restricted Subsidiaries fails to comply with any
of its agreements contained in the Loan Documents (other than those referred to
in clauses (a), (b), (c), or (d) above) and such failure continues for 30 days
after receipt of a related Notice of Default as specified below

(f) the Borrower fails to pay the principal amount of the Senior Notes that
remain outstanding after the Refinancing Transactions upon their final maturity
date of July 1, 2017;

(g) the Borrower or any Significant Subsidiary fails to pay any Indebtedness
(other than Indebtedness owing to the Borrower or a Restricted Subsidiary of the
Borrower and other than the Indebtedness referred to in clause (f) above) within
any applicable grace period after final maturity or the acceleration of any such
Indebtedness by the holders thereof because of a default, in each case, if the
total amount of such Indebtedness unpaid or accelerated exceeds $12.5 million or
its foreign currency equivalent;

(h) Holdings, the Borrower or any Significant Subsidiary of the Borrower
pursuant to or within the meaning of any Bankruptcy Code:

(i) commences a voluntary case;

(ii) consents to the entry of an order for relief against it in an involuntary
case;

(iii) consents to the appointment of a Custodian of it or for any substantial
part of its property; or

(iv) makes a general assignment for the benefit of its creditors or takes any
comparable action under any foreign laws relating to insolvency,

(i) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Code that:

(i) is for relief against Holdings, the Borrower or any Significant Subsidiary
of the Borrower in an involuntary case;

(ii) appoints a Custodian of Holdings, the Borrower or any Significant
Subsidiary of the Borrower or for any substantial part of its property; or

(iii) orders the winding up or liquidation of Holdings, the Borrower or any
Significant Subsidiary of the Borrower; or any similar relief is granted under
any foreign laws and the order or decree remains unstayed and in effect for
60 days,

 

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(j) the Borrower or any Significant Subsidiary fails to pay final and
non-appealable judgments aggregating in excess of $31.25 million or its foreign
currency equivalent (net of any amounts which are covered by enforceable
insurance policies issued by solvent carriers), which judgments are not
discharged, waived or stayed for a period of 30 days following the entry
thereof,

(k) the Guaranteed Obligation of a Significant Subsidiary ceases to be in full
force and effect (except as contemplated by the terms thereof) or any Guarantor
that qualifies as a Significant Subsidiary denies or disaffirms its obligations
under this Agreement or any Loan Document and such Default continues for 10 days
after receipt of a related Notice of Default as specified below, or

(l) (i) with respect to any Collateral having a Fair Market Value in excess of
$12.5 million, individually or in the aggregate, (x) the security interest under
the Collateral Documents, at any time, ceases to be in full force and effect for
any reason other than in accordance with this Agreement, the Collateral
Documents and the Intercreditor Agreement or (y) any security interest created
thereunder or under this Agreement is declared invalid or unenforceable by a
court of competent jurisdiction or (ii) the Borrower or any Guarantor asserts,
in any pleading in any court of competent jurisdiction, that any security
interest in any Collateral is invalid or unenforceable.

The foregoing shall constitute Events of Default whatever the reason for any
such Event of Default and whether it is voluntary or involuntary or is effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body.

The term “Custodian” means any receiver, trustee, assignee, liquidator,
custodian or similar official under any Bankruptcy Code.

A Default under clauses (d) or (e) above shall not constitute an Event of
Default until the Lender notifies the Borrower in writing of the Default and the
Borrower does not cure such Default within the time specified in clauses (d) or
(e) above, as applicable. Such notice must specify the Default, demand that it
be remedied and state that such notice is a “Notice of Default.”

The Borrower shall deliver to the Collateral Agent and Lender, within thirty
(30) days after the occurrence thereof, written notice of any event which is, or
with the giving of notice or the lapse of time or both would become, an Event of
Default, its status and what action the Borrower is taking or proposes to take
with respect thereto.

Section 6.2 Remedies upon Event of Default. Subject to the Intercreditor
Agreement, during the continuance of any Event of Default and in every such
event, the Lender, upon notice to the Borrower, may declare, in whole or, from
time to time, in part, the principal of and interest on the Loans and the Note
and all other amounts owing under the Loan Documents to be, and the Loans and
the Note and all such other amounts shall thereupon and to that extent become,
due

 

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and payable. Presentment, demand, protest or notice of any kind (other than the
notice provided for in the first sentence of this Section 6.02) are hereby
expressly waived, provided that upon the occurrence of an actual or deemed entry
of an order for relief with respect to any Loan Party under the Bankruptcy Code,
the obligation of the Lender to make Loans shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, in each case
without further act of the Lender.

ARTICLE VII

GUARANTEE

Section 7.1 The Guarantee. Each Guarantor hereby jointly and severally with the
other Guarantors guarantees, as a primary obligor and not as a surety to the
Secured Party and their respective successors and assigns, the prompt payment in
full when due (whether at stated maturity, by required prepayment, declaration,
demand, by acceleration or otherwise) of the principal of and interest
(including any interest, fees, costs or charges that would accrue but for the
provisions of (i) the Title 11 of the United States Code after any bankruptcy or
insolvency petition under Title 11 of the United States Code and (ii) any other
Debtor Relief Laws) on the Loans made by the Lender to, and the Notes, if any,
held by each Lender of, the Borrower (other than such Guarantor), and all other
Obligations from time to time owing to the Secured Party by any Loan Party under
any Loan Document strictly in accordance with the terms thereof (such
obligations being herein collectively called the “Guaranteed Obligations”). The
Guarantors hereby jointly and severally agree that if the Borrower or other
Guarantor(s) shall fail to pay in full when due (whether at stated maturity, by
acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors
will promptly pay the same in cash, without any demand or notice whatsoever, and
that in the case of any extension of time of payment or renewal of any of the
Guaranteed Obligations, the same will be promptly paid in full when due (whether
at extended maturity, by acceleration or otherwise) in accordance with the terms
of such extension or renewal.

Section 7.2 Obligations Unconditional. The obligations of the Guarantors under
Section 7.01 shall constitute a guaranty of payment and to the fullest extent
permitted by applicable Law, are absolute, irrevocable and unconditional, joint
and several, irrespective of the value, genuineness, validity, regularity or
enforceability of the Guaranteed Obligations of the Borrower under this
Agreement, the Notes, if any, or any other agreement or instrument referred to
herein or therein, or any substitution, release or exchange of any other
guarantee of or security for any of the Guaranteed Obligations, and,
irrespective of any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a surety or Guarantor
(except for payment in full). Without limiting the generality of the foregoing,
it is agreed that the occurrence of any one or more of the following shall not
alter or impair the liability of the Guarantors hereunder which shall remain
absolute, irrevocable and unconditional under any and all circumstances as
described above:

(a) at any time or from time to time, without notice to the Guarantors, to the
extent permitted by Law, the time for any performance of or compliance with any
of the Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;

 

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(b) any of the acts mentioned in any of the provisions of this Agreement or the
Notes, if any, or any other agreement or instrument referred to herein or
therein shall be done or omitted;

(c) the maturity of any of the Guaranteed Obligations shall be accelerated, or
any of the Guaranteed Obligations shall be amended in any respect, or any right
under the Loan Documents or any other agreement or instrument referred to herein
or therein shall be amended or waived in any respect or any other guarantee of
any of the Guaranteed Obligations or except as permitted pursuant to
Section 7.09, any security therefor shall be released or exchanged in whole or
in part or otherwise dealt with;

(d) any Lien or security interest granted to, or in favor of, the Secured Party,
as security for any of the Guaranteed Obligations shall fail to be perfected; or

(e) the release of any other Guarantor pursuant to Section 7.09 or otherwise.

The Guarantors hereby expressly waive diligence, presentment, demand of payment,
protest and, to the extent permitted by Law, all notices whatsoever, and any
requirement that any Secured Party exhaust any right, power or remedy or proceed
against the Borrower under this Agreement or the Notes, if any, or any other
agreement or instrument referred to herein or therein, or against any other
person under any other guarantee of, or security for, any of the Guaranteed
Obligations. The Guarantors waive, to the extent permitted by Law, any and all
notice of the creation, renewal, extension, waiver, termination or accrual of
any of the Guaranteed Obligations and notice of or proof of reliance by any
Secured Party upon this Guarantee or acceptance of this Guarantee, and the
Guaranteed Obligations, and any of them, shall conclusively be deemed to have
been created, contracted or incurred in reliance upon this Guarantee, and all
dealings between the Borrower and the Secured Parties shall likewise be
conclusively presumed to have been had or consummated in reliance upon this
Guarantee. This Guarantee shall be construed as a continuing, absolute,
irrevocable and unconditional guarantee of payment without regard to any right
of offset with respect to the Guaranteed Obligations at any time or from time to
time held by Secured Parties, and the obligations and liabilities of the
Guarantors hereunder shall not be conditioned or contingent upon the pursuit by
the Secured Parties or any other person at any time of any right or remedy
against the Borrower or against any other person which may be or become liable
in respect of all or any part of the Guaranteed Obligations or against any
collateral security or guarantee therefor or right of offset with respect
thereto. This Guarantee shall remain in full force and effect and be binding in
accordance with and to the extent of its terms upon the Guarantors and the
successors and assigns thereof, and shall inure to the benefit of the Lenders,
and their respective successors and assigns, notwithstanding that from time to
time during the term of this Agreement there may be no Guaranteed Obligations
outstanding

Section 7.3 Reinstatement. The obligations of the Guarantors under this Article
VIII shall be automatically reinstated if and to the extent that for any reason
any payment by or on behalf of the Borrower or other Loan Party in respect of
the Guaranteed Obligations is rescinded or must be otherwise restored by any
holder of any of the Guaranteed Obligations, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise.

 

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Section 7.4 Subrogation; Subordination. Each Guarantor hereby agrees that until
the payment and satisfaction in full in cash of all Guaranteed Obligations it
shall waive any claim and shall not exercise any right or remedy, direct or
indirect, arising by reason of any performance by it of its guarantee in
Section 7.01, whether by subrogation or otherwise, against the Borrower or any
other Guarantor of any of the Guaranteed Obligations or any security for any of
the Guaranteed Obligations. Any Indebtedness of any Loan Party to any other Loan
Party or Subsidiary thereof permitted hereunder or under the Senior Debt
Documents shall be subordinated to such Loan Party’s Obligations in the manner
set forth in the Intercompany Note evidencing such Indebtedness.

Section 7.5 Remedies. The Guarantors jointly and severally agree that, as
between the Guarantors and the Lenders, the obligations of the Borrower under
this Agreement and the Notes, if any, may be declared to be forthwith due and
payable as provided in Section 6.02 (and shall be deemed to have become
automatically due and payable in the circumstances provided in Section 6.02) for
purposes of Section 7.01, notwithstanding any stay, injunction or other
prohibition preventing such declaration (or such obligations from becoming
automatically due and payable) as against the Borrower and that, in the event of
such declaration (or such obligations being deemed to have become automatically
due and payable), such obligations (whether or not due and payable by the
Borrower) shall forthwith become due and payable by the Guarantors for purposes
of Section 7.01.

Section 7.6 Instrument for the Payment of Money. Each Guarantor hereby
acknowledges that the guarantee in this Article VIII constitutes an instrument
for the payment of money, and consents and agrees that the Secured Party, at its
sole option, in the event of a dispute by such Guarantor in the payment of any
moneys due hereunder, shall have the right to bring a motion-action under New
York CPLR Section 3213.

Section 7.7 Continuing Guarantee. The guarantee in this Article VIII is a
continuing guarantee of payment, and shall apply to all Guaranteed Obligations
whenever arising.

Section 7.8 General Limitation on Guarantee Obligations. In any action or
proceeding involving any state corporate limited partnership or limited
liability company law, or any applicable state, federal or foreign bankruptcy,
insolvency, reorganization or other Law affecting the rights of creditors
generally, if the obligations of any Guarantor under Section 7.01 would
otherwise be held or determined to be void, voidable, invalid or unenforceable,
or subordinated to the claims of any other creditors, on account of the amount
of its liability under Section 7.01, then, notwithstanding any other provision
to the contrary, the amount of such liability shall, without any further action
by such Guarantor, any Loan Party or any other person, be automatically limited
and reduced to the highest amount (after giving effect to the right of
contribution established in Section 7.10) that is valid and enforceable and not
subordinated to the claims of other creditors as determined in such action or
proceeding.

Section 7.9 Release of Guarantors.

(a) A Guaranteed Obligation of any Subsidiary Guarantor and, where applicable,
Holdings, shall automatically terminate and be of no further force or effect and
such Subsidiary Guarantor or Holdings, where applicable, shall be deemed to be
released and discharged from all obligations under this Article VII upon:

 

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(i) the sale, disposition or other transfer (including through merger or
consolidation) of the Capital Stock (including any sale, disposition or other
transfer following which the applicable Guarantor is no longer a Restricted
Subsidiary), or all or substantially all the assets, of the applicable Guarantor
if such sale, disposition or other transfer is made in compliance with this
Agreement,

(ii) the Borrower designating such Subsidiary Guarantor to be an Unrestricted
Subsidiary in accordance with the provisions set forth under Section 4 of Annex
A and the definition of “Unrestricted Subsidiary,” or

(iii) in the case of any Restricted Subsidiary which after the Closing Date is
required to guarantee the Obligations pursuant to Section 10 of Annex A, the
release or discharge of the guarantee by such Restricted Subsidiary of
Indebtedness of the Borrower or any Restricted Subsidiary of the Borrower or
such Restricted Subsidiary or the repayment of the Indebtedness or Disqualified
Stock, in each case, which resulted in the obligation to guarantee the
Obligations,

provided that no Guaranteed Obligations of a Guarantor shall be released or
terminated unless and until such Guarantee is released or terminated, as
applicable, under the First Lien Credit Agreement and the Second Lien Indenture,
and the Borrower shall have provided written notice thereof to the Collateral
Agent and the Lender; and provided further that any guarantee that is reinstated
under the First Lien Credit Agreement or the Second Lien Indenture shall be
concurrently, automatically and without notice reinstated under this Agreement.

(b) A Guaranteed Obligation also shall be automatically released upon the
applicable Subsidiary Guarantor ceasing to be a Subsidiary as a result of any
foreclosure of any pledge or security interest securing the First Lien Credit
Agreement or the Second Lien Indenture or other exercise of remedies in respect
thereof.

Section 7.10 Right of Contribution. Each Guarantor hereby agrees that to the
extent that a Subsidiary Guarantor shall have paid more than its proportionate
share of any payment made hereunder, such Subsidiary Guarantor shall be entitled
to seek and receive contribution from and against any other Guarantor hereunder
which has not paid its proportionate share of such payment. Each Subsidiary
Guarantor’s right of contribution shall be subject to the terms and conditions
of Section 7.04. The provisions of this Section 7.10 shall in no respect limit
the obligations and liabilities of any Subsidiary Guarantor to the Lender, and
each Subsidiary Guarantor shall remain liable to the Lender for the full amount
guaranteed by such Subsidiary Guarantor hereunder.

ARTICLE VIII

MISCELLANEOUS

Section 8.1 Notices and Deliveries. Except as otherwise expressly provided, all
notices, communications and materials to be given or delivered pursuant to the
Loan Documents

 

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shall be given or delivered in writing (which shall include telecopy
transmissions) at the following respective addresses and telecopier numbers and
to the attention of the following individuals or departments or at such other
address or telecopier or telephone number or to the attention of such other
individual or department as the party to which such information pertains may
hereafter specify:

 

  (a) if to the Borrower, to it at:

c/o Dyncorp International Inc.

1700 Old Meadow Road

McLean, VA 22102

Attention: Gregory Nixon

 

  (b) if to the Collateral Agent, to it at:

c/o Cerberus Capital Management, L.P.

875 Third Avenue 11th Floor

New York, NY 10022

Telephone No.: (212) 284-7931

Attention: Michael Sanford

 

  (c) if to the Lender, to it at:

c/o Cerberus Capital Management, L.P.

875 Third Avenue 11th Floor

New York, NY 10022

Telephone No.: (212) 284-7931

Attention: Michael Sanford

Notices, communications and materials shall be deemed given or delivered when
delivered or received at the appropriate address or telecopy number to the
attention of the appropriate individual or department.

Section 8.2 Amounts Payable Due upon Request for Payment. All amounts payable by
the Borrower under the Loan Documents shall, except as otherwise expressly
provided, be immediately due upon request for the payment thereof.

Section 8.3 Rights Cumulative. Each of the rights and remedies of the Secured
Parties under the Loan Documents shall be in addition to all of its other rights
and remedies under the Loan Documents and Applicable Law, and nothing in the
Loan Documents shall be construed as limiting any such rights or remedies.

Section 8.4 Amendments; Waivers. Subject to the Intercreditor Agreement, any
term, covenant, agreement or condition of the Loan Documents may be amended, and
any right under the Loan Documents may be waived, if, but only if, such
amendment or waiver is in writing and is signed by the Lender and, in the case
of an amendment, by the Borrower. Unless otherwise specified in such waiver, a
waiver of any right under the Loan Documents shall be effective only

 

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in the specific instance and for the specific purpose for which given. No
election not to exercise, failure to exercise or delay in exercising any right,
nor any course of dealing or performance, shall operate as a waiver of any right
of the Lender under the Loan Documents or Applicable Law, nor shall any single
or partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right of the Lender under the Loan
Documents or Applicable Law.

Section 8.5 Set-Off. Subject to the Intercreditor Agreement, the Lender is
hereby authorized by the Loan Parties, at any time and from time to time,
without notice, during any Event of Default, to set off against, and to
appropriate and apply to the payment of, the Liabilities of the Loan Parties
under the Loan Documents (whether matured or unmatured, fixed or contingent or
liquidated or unliquidated) any and all Liabilities owing by the Lender or any
of its Affiliates to the Borrower (whether payable in Dollars or any other
currency, whether matured or unmatured and, in the case of Liabilities that are
deposits, whether general or special, time or demand and however evidenced and
whether maintained at a branch or office located within or without the United
States).

Section 8.6 Assignments and Participations. (a) The Borrower may not assign any
of its rights or obligations under the Loan Documents without the prior written
consent of the Lender, and no assignment of any such obligation shall release
the Borrower therefrom unless the Lender shall have consented to such release in
a writing specifically referring to the obligation from which the Borrower is to
be released.

(b) The Lender may assign or grant a participation in any or all of its rights
and obligations under the Loan Documents from time to time.

(c) The Lender shall maintain a register (the “Register”) for the recordation of
the names and addresses of the Lender and the principal amount of the Loans
owing to the Lender from time to time. The entries in the Register shall be
conclusive and binding absent manifest error and the Borrower and the Lender
shall treat each Person whose name is recorded in the Register as a Lender for
all purposes of this Agreement. The Register shall be available for inspection
by the Borrower at any reasonable time upon reasonable prior notice. In the
event that a Lender sells a participation in a Loan, such Lender shall maintain
a register (the “Participant Register”) for the recordation of the names and
addresses of all participants in the Loans held by the Lender and the principal
amount of the portion of the Loan that is subject to such participations. A Loan
may be participated only by registration of such participation in the
Participant Register, which shall be conclusive and binding absent manifest
error. The Participant Register shall be available for inspection by the
Borrower at any reasonable time upon reasonable prior notice.

Section 8.7 Attorney Costs and Expenses. The Borrower agrees (a) if the Closing
Date occurs, to pay or reimburse DynCorp Funding LLC, in its capacity as both
Lender and Secured Party, for all reasonable out-of-pocket costs and expenses
incurred in connection with the preparation, negotiation, syndication and
execution of this Agreement and the other Loan Documents, and any amendment,
waiver, consent or other modification of the provisions hereof and thereof
(whether or not the transactions contemplated thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby

 

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(including all Attorney Costs which shall be limited to Schulte Roth & Zabel LLP
(and one local counsel in each applicable jurisdiction and, solely in the event
of an actual conflict of interest, one additional counsel in each applicable
material jurisdiction to the affected Persons, taken as a whole) and (b) from
and to the Closing Date, to pay or reimburse DynCorp Funding LLC, in its
capacity as both Lender and Secured Party for all reasonable and documented
out-of-pocket costs and expenses incurred in connection with the enforcement
(whether through negotiations, legal proceedings or otherwise) of any rights or
remedies under this Agreement or the other Loan Documents (including all such
costs and expenses incurred during any legal proceeding, including any
proceeding under any Debtor Relief Law, and including all respective Attorney
Costs, which shall be limited to Attorney Costs of one counsel to the the
Secured Parties). The foregoing costs and expenses shall include all reasonable
search, filing, recording and title insurance charges and fees related thereto,
and other reasonable out-of-pocket expenses incurred by the Lender and the other
Secured Parties. The agreements in this Section 8.7 shall survive the repayment
of all Obligations. Subject to the Intercreditor Agreement, all amounts due
under this Section 8.7 shall be paid within ten (10) Business Days of receipt by
the Borrower of an invoice relating thereto setting forth such expenses in
reasonable detail; provided that, with respect to the Closing Date, all amounts
due under this Section 8.7 shall be paid on the Closing Date solely to the
extent invoiced to the Borrower within two (2) Business Days of the Closing
Date. If any Loan Party fails to pay when due any costs, expenses or other
amounts payable by it hereunder or under any Loan Document, such amount may be
paid on behalf of such Loan Party by the Lender in its sole discretion.

Section 8.8 Indemnification by the Borrower. Whether or not the transactions
contemplated hereby are consummated, from and after the Closing Date, the Loan
Parties shall indemnify and hold harmless each Agent-Related Person, the Lender
and its respective Affiliates, and directors, officers, employees, counsel,
agents, trustees, investment advisors and attorneys-in-fact of each of the
foregoing (collectively the “Indemnitees”) from and against any and all
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses and disbursements (including Attorney Costs
which shall be limited to Attorney Costs of one counsel to the Secured Parties)
of any kind or nature whatsoever which may at any time be imposed on, incurred
by or asserted against any such Indemnitee in any way relating to or arising out
of or in connection with (a) the execution, delivery, enforcement, performance
or administration of any Loan Document or any other agreement, letter or
instrument delivered in connection with the transactions contemplated thereby or
the consummation of the transactions contemplated thereby, (b) any commitment or
Loan or the use or proposed use of the proceeds therefrom, or (c) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory (including
any investigation of, preparation for, or defense of any pending or threatened
claim, investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the “Indemnified
Liabilities”) in all cases, whether or not caused by or arising, in whole or in
part, out of the negligence of the Indemnitee; provided that, notwithstanding
the foregoing, such indemnity shall not, as to any Indemnitee, be available to
the extent that such liabilities, obligations, losses, damages, penalties,
claims, demands, actions, judgments, suits, costs, expenses or disbursements
resulted from (x) the gross negligence or willful misconduct of such Indemnitee
or of any affiliate, director, officer, employee, counsel, agent or
attorney-in-fact of such Indemnitee, as determined by the final, non-appealable
judgment of a court of competent jurisdiction or (y) a material breach of its
obligations under the

 

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Loan Documents by such Indemnitee or of any affiliate, director, officer,
employee, counsel, agent or attorney-in-fact of such Indemnitee as determined by
the final, non-appealable judgment of a court of competent jurisdiction. Neither
any Indemnitee nor Holdings, the Borrower or any Subsidiary shall have any
liability for any special, punitive, indirect or consequential damages relating
to this Agreement or any other Loan Document or arising out of its activities in
connection herewith or therewith (whether before or after the Closing Date)
except with respect to Loan Parties to the extent such damages would otherwise
be subject to indemnification pursuant to this Section 8.8. In the case of an
investigation, litigation or other proceeding to which the indemnity in this
Section 8.8 applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by any Loan Party, any
Subsidiary of any Loan Party, any Loan Party’s directors, stockholders or
creditors or an Indemnitee or any other Person, whether or not any Indemnitee is
otherwise a party thereto and whether or not any of the transactions
contemplated hereunder or under any of the other Loan Documents are consummated.
Subject to the Intercreditor Agreement, all amounts due under this Section 8.8
shall be paid within ten (10) Business Days after demand therefor; provided,
however, that such Indemnitee shall promptly refund such amount to the extent
that there is a final judicial or arbitral determination that such Indemnitee
was not entitled to indemnification rights with respect to such payment pursuant
to the express terms of this Section 8.8. The agreements in this Section 8.8
shall survive the resignation of DynCorp Funding LLC, in its capacity as either
Lender or Secured Party, the replacement of, or assignment of rights by, any
Lender, the repayment, satisfaction or discharge of all the Obligations.

Section 8.9 Governing Law. The rights and duties of the Borrower, Collateral
Agent and the Lender under this Agreement and the Notes (including matters
relating to the Maximum Permissible Rate) shall be governed by the law of the
State of New York.

Section 8.10 Judicial Proceedings; Waiver of Jury Trial. The Borrower agrees
that any judicial proceeding brought against it with respect to any Loan
Document Related Claim may be brought in any court of competent jurisdiction in
the City of New York and irrevocably waives any objection it may now or
hereafter have as to the venue of any such proceeding brought in such a court or
that such a court is an inconvenient forum. The Borrower waives personal service
of process and consents that service of process upon it may be made by certified
or registered mail, return receipt requested, at its address specified or
determined in accordance with the provisions of Section 8.01, and service so
made shall be deemed completed on the third Business Day after such service is
deposited in the mail. Any judicial proceeding by the Borrower against a Secured
Party involving any Loan Document Related Claim shall be brought only in a court
located in the City and State of New York. THE LOAN PARTIES AND THE SECURED
PARTIES HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING TO WHICH THEY ARE
PARTIES INVOLVING ANY LOAN DOCUMENT RELATED CLAIM.

Section 8.11 Severability of Provisions. Any provision of the Loan Documents
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions thereof or
affecting the validity or enforceability of such provision in any other
jurisdiction. To the extent permitted by Applicable Law, the Borrower hereby
waives any provision of Applicable Law that renders any provision of the Loan
Documents prohibited or unenforceable in any respect.

 

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Section 8.12 Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto were upon the same instrument.

Section 8.13 Entire Agreement. This Agreement and the Note embody the entire
agreement between the Borrower and the Secured Parties relating to the subject
matter hereof and supersede all prior agreements, representations and
understandings, if any, relating to the subject matter hereof.

Section 8.14 Successors and Assigns. All of the provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.

Section 8.15 Release of Collateral.

(a) Subject to Section 8.15(b) hereof, Collateral may be released from the Liens
and security interests created by the Collateral Documents at any time or from
time to time in accordance with the provisions of the Collateral Documents, the
Intercreditor Agreement and this Agreement. The Borrower and the Guarantors will
be entitled to a release of property and other assets included in the Collateral
from the Liens securing the Obligations, and the Collateral Agent shall release
the same from such Liens at the Borrower’s sole cost and expense, under one or
more of the following circumstances:

(1) to enable the Borrower and its Restricted Subsidiaries to consummate the
disposition of such property or assets to the extent permitted under Section 6
of Annex A; provided that any release of Collateral under this subclause (1),
and any transaction resulting in the release of such Collateral, are not
prohibited under this Agreement;

(2) in the case of a Guarantor that is released from its Guaranteed Obligations
under Section 7.9, the release of the property and assets of such Guarantor;

(3) pursuant to an amendment or waiver in accordance with Section 8.4; or

(4) pursuant to the terms of the Intercreditor Agreement.

(b) With respect to any release of Collateral, upon receipt of an certificate of
a Responsible Officer stating that all conditions precedent under this Agreement
and the Collateral Documents and the Intercreditor Agreement to such release
have been met and that it is proper for the Collateral Agent to execute and
deliver the documents requested by the Borrower in connection with such release,
and any instruments of termination, satisfaction or release prepared by the
Borrower, the Collateral Agent shall execute, deliver or acknowledge (at the
Borrower’s sole cost and expense) such instruments or releases to evidence the
release of any Collateral permitted to be released pursuant to this Agreement or
the Collateral Documents or the Intercreditor Agreement. The Collateral Agent
shall not be liable for any such release undertaken in reliance upon any such
certificate of a Responsible Officer, and the Collateral

 

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Agent shall not, and shall not be under any obligation to, release any such Lien
and security interest, or execute and deliver any such instrument of release,
satisfaction or termination, (i) unless and until it receives such certificate
of a Responsible Officer or (ii) if the Intercreditor Agreement expressly
provides for automatic release of Collateral under this Agreement with no
further action required by the Collateral Agent.

Section 8.16 Intercreditor. Notwithstanding anything herein to the contrary, the
Lender (a) acknowledges that it has received a copy of the Intercreditor
Agreement, (b) consent to the subordination provided for in the Intercreditor
Agreement and (c) agrees that it will be bound by and will take no actions
contrary to the provisions of the Intercreditor Agreement. To the extent of any
conflict between the terms and provisions of this Agreement and the
Intercreditor Agreement, the Intercreditor Agreement shall govern.

ARTICLE IX

COLLATERAL AGENT AND OTHER AGENTS

Section 9.1 Appointment and Authorization of Agents.

(a) Each Lender hereby irrevocably appoints, designates and authorizes the
Collateral Agent to take such action on its behalf under the provisions of this
Agreement and each other Loan Document and to exercise such powers and perform
such duties as are expressly delegated to it by the terms of this Agreement or
any other Loan Document, together with such powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary contained elsewhere
herein or in any other Loan Document, the Collateral Agent shall not have any
duties or responsibilities, except those expressly set forth herein, nor shall
the Collateral Agent have or be deemed to have any fiduciary relationship with
any Lender or participant, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Collateral
Agent. Without limiting the generality of the foregoing sentence, the use of the
term “agent” herein and in the other Loan Documents with reference to the
Collateral Agent is not intended to connote any fiduciary or other implied (or
express) obligations arising under agency doctrine of any applicable Law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.

(b) Each of the Secured Parties hereby irrevocably appoints and authorizes the
Collateral Agent to act as the agent of (and to hold any security interest
created by the Collateral Documents for and on behalf of or in trust for) such
Secured Party for purposes of acquiring, holding and enforcing any and all Liens
on Collateral granted by the Loan Parties to secure any of the Obligations,
together with such powers and discretion as are reasonably incidental thereto.
In this connection, the Collateral Agent (and any co-agents, sub-agents and
attorneys-in-fact appointed by the Collateral Agent pursuant to Section 9.2 for
purposes of holding or enforcing any Lien on the Collateral (or any portion
thereof) granted under the Collateral Documents, or for exercising any rights
and remedies thereunder at the direction of the Collateral Agent), shall be
entitled to the benefits of all provisions of this Article IX (including,
Section 9.7, as though such co-agents, sub-agents and attorneys-in-fact were the
Collateral Agent under the Loan Documents) as if set forth in full herein with
respect thereto.

 

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Section 9.2 Delegation of Duties.

The Collateral Agent may execute any of its duties under this Agreement or any
other Loan Document (including for purposes of holding or enforcing any Lien on
the Collateral (or any portion thereof) granted under the Collateral Documents
or of exercising any rights and remedies thereunder) by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel and
other consultants or experts concerning all matters pertaining to such duties.
The Collateral Agent shall not be responsible for the negligence or misconduct
of any agent or sub-agent or attorney-in-fact that it selects in the absence of
gross negligence or willful misconduct (as determined in the final
non-appealable judgment of a court of competent jurisdiction).

Section 9.3 Liability of Agents.

No Agent-Related Person shall (a) be liable for any action taken or omitted to
be taken by any of them under or in connection with this Agreement or any other
Loan Document or the transactions contemplated hereby (except for its own gross
negligence or willful misconduct, as determined by the final non-appealable
judgment of a court of competent jurisdiction, in connection with its duties
expressly set forth herein), or (b) be responsible in any manner to any Lender
or participant for any recital, statement, representation or warranty made by
any Loan Party or any officer thereof, contained herein or in any other Loan
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by the Collateral Agent under or in connection
with, this Agreement or any other Loan Document, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or the perfection or priority of any Lien or security interest created
or purported to be created under the Collateral Documents, or for any failure of
any Loan Party or any other party to any Loan Document to perform its
obligations hereunder or thereunder. No Agent-Related Person shall be under any
obligation to any Lender or participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of any Loan Party or any Affiliate thereof.

Section 9.4 Reliance by Agents.

The Collateral Agent shall be entitled to rely, and shall be fully protected in
relying, upon any writing, communication, signature, resolution, representation,
notice, consent, certificate, affidavit, letter, telegram, facsimile, telex or
telephone message, electronic mail message, statement or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons, and upon advice and statements of
legal counsel (including counsel to any Loan Party), independent accountants and
other experts selected by the Collateral Agent. The Collateral Agent shall be
fully justified in failing or refusing to take any action under any Loan
Document unless it shall first receive such advice or concurrence of the Lender
as it deems appropriate and, if it so requests, it shall first be indemnified to
its satisfaction by the Lender against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such action.
The Collateral Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Lender and such request and any
action taken or failure to act pursuant thereto shall be binding upon the
Lender.

 

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Section 9.5 Credit Decision; Disclosure of Information by Agents.

The Lender acknowledges that no Agent-Related Person has made any representation
or warranty to it, and that no act by the Collateral Agent hereafter taken,
including any review of the affairs of any Loan Party or any Affiliate thereof,
shall be deemed to constitute any representation or warranty by any
Agent-Related Person to the Lender as to any matter, including whether
Agent-Related Persons have disclosed material information in their possession.
The Lender represents to the Collateral Agent that it has, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it has deemed appropriate, made its own appraisal of, and
investigation into, the business, prospects, operations, property, financial and
other condition and creditworthiness of the Loan Parties and their Subsidiaries,
and all applicable bank or other regulatory Laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower hereunder. The Lender also represents that it
will, independently and without reliance upon any Agent-Related Person and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties. The Collateral Agent shall not have any
duty or responsibility to provide the Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of any of the Loan Parties or any of
their Affiliates which may come into the possession of any Agent-Related Person.

Section 9.6 Indemnification of Agents.

Whether or not the transactions contemplated hereby are consummated, the Lender
shall indemnify upon demand each Agent-Related Person (to the extent not
reimbursed by or on behalf of any Loan Party and without limiting the obligation
of any Loan Party to do so), pro rata (if applicable), and hold harmless each
Agent-Related Person from and against any and all Indemnified Liabilities
incurred by it; provided that no Lender shall be liable for the payment to any
Agent-Related Person of any portion of such Indemnified Liabilities resulting
from such Agent-Related Person’s own gross negligence or willful misconduct, as
determined by the final non-appealable judgment of a court of competent
jurisdiction; provided that no action taken in accordance with the directions of
the Lender shall be deemed to constitute gross negligence or willful misconduct
for purposes of this Section 9.6. In the case of any investigation, litigation
or proceeding giving rise to any Indemnified Liabilities, this Section 9.6
applies whether any such investigation, litigation or proceeding is brought by
the Lender or any other Person. Without limitation of the foregoing, the Lender
shall reimburse the Collateral Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including Attorney Costs) incurred by the
Collateral Agent, as the case may be, in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement, any other
Loan Document, or any document contemplated by or referred to herein,

 

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to the extent that the Collateral Agent is not reimbursed for such expenses by
or on behalf of the Loan Parties. The undertaking in this Section 9.6 shall
survive termination of the commitments, the payment of all other Obligations and
the resignation of the Collateral Agent, as the case may be.

Section 9.7 Successor Agents.

The Collateral Agent may resign as the Collateral Agent upon thirty (30) days’
notice to the Lender and the Borrower. If the Collateral Agent resigns under
this Agreement, the Lender shall appoint a successor agent for the Lender, which
successor agent shall be consented to by the Borrower at all times (which
consent of the Borrower shall not be unreasonably withheld or delayed). If no
successor agent is appointed prior to the effective date of the resignation, the
Collateral Agent, may appoint, after consulting with the Lender and the
Borrower, a successor agent. Upon the acceptance of its appointment as successor
agent hereunder, the Person acting as such successor agent shall succeed to all
the rights, powers and duties of the retiring Collateral Agent and the term
“Collateral Agent” shall mean such successor collateral agent and/or
Supplemental Agent, as the case may be, and the retiring Collateral Agent’s
appointment, powers and duties as the Collateral Agent shall be terminated.
After the retiring the Collateral Agent’s resignation hereunder as the
Collateral Agent, the provisions of this Article IX and Sections 8.7 and 8.8
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was the Collateral Agent under this Agreement. If no successor agent
has accepted appointment as the Collateral Agent by the date which is thirty
(30) days following the retiring Collateral Agent’s notice of resignation, the
retiring Collateral Agent’s resignation shall nevertheless thereupon become
effective and the Lender shall perform all of the duties of the Collateral Agent
hereunder until such time, if any, as the Lender appoints a successor agent as
provided for above. Upon the acceptance of any appointment as the Collateral
Agent hereunder by a successor and upon the execution and filing or recording of
such financing statements, or amendments thereto, and such other instruments or
notices, as may be necessary or desirable, or as the Lender may request, in
order to (a) continue the perfection of the Liens granted or purported to be
granted by the Collateral Documents or (b) otherwise ensure that Sections 10 and
19 of Annex A are satisfied, the Collateral Agent shall thereupon succeed to and
become vested with all the rights, powers, discretion, privileges, and duties of
the retiring Collateral Agent, and the retiring Collateral Agent shall be
discharged from its duties and obligations under the Loan Documents. After the
retiring Collateral Agent’s resignation hereunder as the Collateral Agent, the
provisions of this Article IX shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
the Collateral Agent.

Section 9.8 Collateral Agent May File Proofs of Claim.

Subject to the Intercreditor Agreement, in case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to any Loan Party,
the Collateral Agent (irrespective of whether the principal of any Loans shall
then be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the Lender shall have made any demand on the Borrower or
the Collateral Agent) shall be (to the fullest extent permitted by mandatory
provisions of applicable Law) entitled and empowered, by intervention in such
proceeding or otherwise:

 

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(a) to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Loans and all other Obligations that are
owing and unpaid and to file such other documents as may be necessary or
advisable in order to have the claims of the Lender and the Collateral Agent
allowed in such judicial proceeding; and

(b) to collect and receive any monies or other property payable or deliverable
on any such claims and to distribute the same;

and any custodian, curator, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is hereby
authorized by the Lender to make such payments to the Collateral Agent and, in
the event that the Collateral Agent shall consent to the making of such payments
directly to the Lender, to pay to the Collateral Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the Collateral
Agent and its agents and counsel, and any other amounts due the Collateral Agent
under this Agreement.

Section 9.9 Collateral and Guaranty Matters.

The Lender irrevocably agrees:

(a) that any Lien on any property granted to or held by the Collateral Agent
under any Loan Document shall be automatically released (i) upon termination of
the commitments and payment in full of all Obligations, (ii) at the time the
property subject to such Lien is disposed or to be substantially simultaneously
disposed as part of or in connection with any disposition permitted hereunder or
under any other Loan Document to any Person other than a Person required to
grant a Lien to the Collateral Agent under the Loan Documents (or, if such
transferee is a Person required to grant a Lien to the Collateral Agent on such
asset, at the option of the applicable Loan Party, such Lien on such asset may
still be released in connection with the transfer so long as (x) the transferee
grants a new Lien to the Collateral Agent on such asset substantially
concurrently with the transfer of such asset, (y) the transfer is between
parties organized under the laws of different jurisdictions and the transferee
is a Foreign Subsidiary and (z) the priority of the new Lien is the same as that
of the original Lien), (iii) subject to Section 8.4, if the release of such Lien
is approved, authorized or ratified in writing by the Lender or (iv) if the
property subject to such Lien is owned by a Guarantor, upon release of such
Guarantor from its Guaranteed Obligations pursuant to clause (c) or (d) below;

(b) the Collateral Agent is authorized to release any Lien on any property
granted to or held by the Collateral Agent under any Loan Document on any assets
that are excluded from the Collateral; and

(c) that any Guarantor shall be automatically released from its Guaranteed
Obligations if such Person ceases to be a Restricted Subsidiary or becomes an
Excluded Subsidiary (other than pursuant to (i) clause (a) of the definition
thereof unless such Restricted Subsidiary ceases to be a Restricted Subsidiary
or (ii) clause (b) of the definition thereof unless, in the case of this
subclause (ii), the Borrower delivers a written request to the Collateral Agent
for such release and no Default has occurred and is continuing at such time) as
a result of a transaction or designation permitted hereunder; provided that no
such release shall occur if such Guarantor continues to be a guarantor in
respect of First Lien Credit Agreement, Second Lien Notes or Senior Notes.

 

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Upon request by the Collateral Agent at any time, Lender will confirm in writing
the Collateral Agent’s authority to release or subordinate its interest in
particular types or items of property, or to release any Guarantor from its
Guaranteed Obligaitons pursuant to this Section 9.9. In each case as specified
in this Section 9.9, the Collateral Agent will (and the Lender irrevocably
authorizes the Collateral Agent to), at the Borrower’s expense, execute and
deliver to the applicable Loan Party such documents as the Borrower may
reasonably request to evidence the release or subordination of such item of
Collateral from the assignment and security interest granted under the
Collateral Documents, or to evidence the release of such Guarantor from its
Guaranteed Obligations, in each case in accordance with the terms of the Loan
Documents and this Section 9.9.

Section 9.10 Appointment of Supplemental Agents.

(a) It is the purpose of this Agreement and the other Loan Documents that there
shall be no violation of any Law of any jurisdiction denying or restricting the
right of banking corporations or associations to transact business as 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 the Collateral 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, the Collateral Agent is hereby authorized to
appoint an additional individual or institution selected by the Collateral Agent
in its sole discretion as a separate trustee, co-trustee, administrative agent,
collateral agent, administrative sub-agent or administrative co-agent (any such
additional individual or institution being referred to herein individually as a
“Supplemental Agent” and collectively as “Supplemental Agents”).

(b) In the event that the Collateral Agent appoints a Supplemental 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 the Collateral Agent with respect to
such Collateral shall be exercisable by and vest in such Supplemental Agent to
the extent, and only to the extent, necessary to enable such Supplemental 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 Agent shall run to and be enforceable
by either the Collateral Agent or such Supplemental Agent, and (ii) the
provisions of this Article IX and of Sections 8.7 and 8.8 that refer to the
Collateral Agent shall inure to the benefit of such Supplemental Agent and all
references therein to the Collateral Agent shall be deemed to be references to
the Collateral Agent and/or such Supplemental Agent, as the context may require.

(c) Should any instrument in writing from any Loan Party be required by any
Supplemental Agent so appointed by the Collateral Agent for more fully and
certainly vesting in and confirming to it or its such rights, powers, privileges
and duties, such Loan Party shall

 

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execute, acknowledge and deliver any and all such instruments promptly upon
request by the Collateral Agent. In case any Supplemental 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 Agent, to the extent
permitted by Law, shall vest in and be exercised by the Collateral Agent until
the appointment of a new Supplemental Agent.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers all as of the Closing Date.

 

DYNCORP INTERNATIONAL INC. By:  

/s/ William T. Kansky

  Name: William T. Kansky   Title: Senior Vice President and Chief Financial
Officer

 

DELTA TUCKER HOLDINGS, INC. By:  

/s/ William T. Kansky

  Name: William T. Kansky   Title: Senior Vice President and Chief Financial
Officer

 

DIV CAPITAL CORPORATION

DTS AVIATION SERVICES LLC

DYN MARINE SERVICES OF VIRGINIA LLC

DYNCORP AEROSPACE OPERATIONS LLC

DYNCORP INTERNATIONAL LLC

DYNCORP INTERNATIONAL SERVICES LLC

HELIWORKS LLC

PHOENIX CONSULTING GROUP, LLC

SERVICES INTERNATIONAL LLC

WORLDWIDE MANAGEMENT AND CONSULTING SERVICES LLC

WORLDWIDE RECRUITING AND STAFFING SERVICES LLC

By:  

/s/ William T. Kansky

  Name: William T. Kansky   Title: Senior Vice President and Chief Financial
Officer

 

CASALS & ASSOCIATES, INC. By:  

/s/ William T. Kansky

  Name: William T. Kansky   Title: Vice President, Chief Financial Officer and
Treasurer

 

[Signature Page to Third Lien Credit Agreement]

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DYNCORP FUNDING LLC, as Lender and as Secured Party By: Cerberus Capital
Management, L.P., its Manager By:  

/s/ Seth P. Plattus

  Name: Seth P. Plattus   Title: Senior Managing Director

 

[Signature Page to Third Lien Credit Agreement]

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ANNEX A

Section 1 Payment of Loans.Subject to the Intercreditor Agreement, the Borrower
shall promptly pay the principal of and interest on the Loans on the dates and
in the manner provided in this Agreement. Subject to the Intercreditor
Agreement, the Borrower shall pay interest on overdue principal at the rate
specified in this Agreement, and it shall pay interest on overdue installments
of interest at the same rate set forth in this Agreement to the extent lawful.

Section 2 Reports and other Information. Notwithstanding that the Borrower may
not be subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, or otherwise report on an annual and quarterly basis on forms
provided for such annual and quarterly reporting pursuant to rules and
regulations promulgated by the SEC, the Borrower shall file with the SEC (and
provide the Lender with copies thereof, without cost to the Lender, within 15
days after it files them with the SEC),

(a) within 90 days after the end of each fiscal year (or such longer period as
may be permitted by the SEC if the Borrower were then subject to such SEC
reporting requirements as a non-accelerated filer), annual reports on Form 10-K
(or any successor or comparable form) containing the information required to be
contained therein (or required in such successor or comparable form) including,
without limitation, a management’s discussion and analysis of financial
information,

(b) within 45 days after the end of each of the first three fiscal quarters of
each fiscal year (or such longer period as may be permitted by the SEC if the
Borrower were then subject to such SEC reporting requirements as a
non-accelerated filer), quarterly reports on Form 10-Q (or any successor or
comparable form) containing the information required to be contained therein (or
required in such successor or comparable form) including, without limitation, a
management’s discussion and analysis of financial information,

(c) promptly from time to time after the occurrence of an event required to be
therein reported (and in any event within the time period specified for filing
current reports on Form 8-K by the SEC), such other reports on Form 8-K (or any
successor or comparable form), and

(d) any other information, documents and other reports that the Borrower would
be required to file with the SEC if it were subject to Section 13 or 15(d) of
the Exchange Act; provided, however, that the Borrower shall not be so obligated
to file such reports with the SEC if the SEC does not permit such filing, in
which event the Borrower shall put such information on its website, in addition
to providing such information to the Lender, in each case within 15 days after
the time the Borrower would be required to file such information with the SEC if
it were subject to Section 13 or 15(d) of the Exchange Act. For the avoidance of
doubt, the obligations of the Borrower under this Section 2 shall commence with
respect to the Borrower’s first fiscal quarter that ends after the Closing Date.

Notwithstanding the foregoing, the Borrower will be deemed to have furnished
such reports referred to above to the Lender if the Borrower or any direct or
indirect parent of the Borrower (including Holdings) has filed such reports with
the SEC via the EDGAR filing system and such reports are publicly available.

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In the event that:

(i) the rules and regulations of the SEC permit any direct or indirect parent of
the Borrower (including Holdings) to report at such parent entity’s level on a
consolidated basis and such parent entity of the Borrower is not engaged in any
business in any material respect other than incidental to its ownership,
directly or indirectly, of the capital stock of the Borrower, or

(ii) such parent entity is or becomes a Guarantor of the Obligations, such
consolidated reporting at such parent entity’s level in a manner consistent with
that described in this Section 2 for the Borrower will satisfy this Section 2;
provided that, such financial information is accompanied by consolidating
information that explains in reasonable detail the differences between the
information relating to such direct or indirect parent and any of its
Subsidiaries other than the Borrower and its Subsidiaries, on the one hand, and
the information relating to the Borrower and its Subsidiaries on a stand-alone
basis, on the other hand.

Delivery of such reports, information and documents to the Lender is for
informational purposes only and the Lender’s receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Borrower’s
compliance with any of its covenants hereunder.

Section 3 Limitation on Incurrence of Indebtedness and Issuance of Disqualified
Stock and Preferred Stock.

(a) (i) Holdings and the Borrower shall not, and shall not permit any of the
Restricted Subsidiaries to, directly or indirectly, Incur any Indebtedness
(including Acquired Indebtedness) or issue any shares of Disqualified Stock and
(ii) the Borrower shall not permit any of its Restricted Subsidiaries to issue
any shares of Preferred Stock.

(b) The limitations set forth in Section 4.03(a) shall not apply to
(collectively, “Permitted Debt”):

(i) the Incurrence by Holdings or its Restricted Subsidiaries of Indebtedness
under the First Lien Credit Agreement and the issuance and creation of letters
of credit and bankers’ acceptances thereunder (with letters of credit and
bankers’ acceptances being deemed to have a principal amount equal to the face
amount thereof) up to an aggregate principal amount not to exceed $368.0 million
outstanding at any one time, less the sum of the amounts of (x) all permanent
reductions of Indebtedness thereunder as a result of principal payments actually
made (A) with net cash proceeds from Asset Sales, (B) as Amortization Payments
and (C) under excess cash flow mandatory prepayment provisions under the First
Lien Credit Agreement, plus (y) all permanent reductions in revolving credit
commitments under the First Lien Credit Agreement other than in connection with
a substantially concurrent refinancing or replacement of the amount so reduced;

 

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(ii) the Incurrence by Holdings, the Borrower and the Subsidiary Guarantors of
Indebtedness represented by the Second Lien Notes issued on the Closing Date
(including PIK Notes (as defined in the Second Lien Indenture as in effect on
the date hereof) and any increased principal amount of Notes as payment for PIK
Interest (as defined in the Second Lien Indenture as in effect on the date
hereof)) and the guarantees thereof, as applicable;

(iii) (A) Indebtedness existing on the Closing Date (other than Indebtedness
described in clauses (i), (ii) and subclause (B) of this clause (iii) of this
Section 3(b)), including without limitation any Senior Notes (and guarantees
thereof) that remain outstanding on the Closing Date after giving effect to the
Refinancing Transactions; and (B) the Indebtedness under the Loan Documents (and
guarantees thereof);

(iv) Indebtedness (including Capitalized Lease Obligations) Incurred by Holdings
or any of its Restricted Subsidiaries, Disqualified Stock issued by Holdings or
any of its Restricted Subsidiaries and Preferred Stock issued by any Restricted
Subsidiaries of the Borrower to finance the purchase, lease, construction or
improvement of property (real or personal) or equipment (whether through the
direct purchase of assets or the Capital Stock of any Person owning such assets)
in an aggregate principal amount, including all Indebtedness Incurred to renew,
refund, refinance, replace, defease or discharge any Indebtedness Incurred
pursuant to this clause (iv), not to exceed the greater of (x) $18.75 million
and (y) 0.95% of Total Assets at the time of Incurrence, at any one time
outstanding;

(v) Indebtedness Incurred by Holdings or any of its Restricted Subsidiaries
constituting reimbursement obligations with respect to letters of credit and
bank guarantees issued in the ordinary course of business, including, without
limitation, letters of credit in respect of workers’ compensation claims,
health, disability or other employee benefits (whether current or former) or
property, casualty or liability insurance or self-insurance, or other
Indebtedness with respect to reimbursement-type obligations regarding workers’
compensation claims; provided, however, that upon the drawing of such letters of
credit, such obligations are reimbursed within 30 days following such drawing;

(vi) Indebtedness arising from agreements of Holdings or a Restricted Subsidiary
providing for indemnification, adjustment of purchase price or similar
obligations, in each case, Incurred in connection with the disposition of any
business, assets or a Subsidiary of Holdings in accordance with the terms of
this Agreement, other than guarantees of Indebtedness Incurred by any Person
acquiring all or any portion of such business, assets or Subsidiary for the
purpose of financing such acquisition;

(vii) Indebtedness of Holdings to a Restricted Subsidiary; provided that such
Indebtedness shall be Subordinated Indebtedness and either unsecured or, if
secured, secured by a Lien that is junior in priority to the Lien securing the
Loans; and provided further that any subsequent issuance or transfer of any
Capital Stock or any other event which results in any such Restricted Subsidiary
ceasing to be a Restricted Subsidiary or any other subsequent transfer of any
such Indebtedness (except to the Borrower or another Restricted Subsidiary)
shall be deemed, in each case to be an Incurrence of such Indebtedness;

 

A-3

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(viii) shares of Preferred Stock of a Restricted Subsidiary issued to the
Borrower or another Restricted Subsidiary; provided that any subsequent issuance
or transfer of any Capital Stock or any other event that results in any
Restricted Subsidiary that holds such shares of Preferred Stock of another
Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other
subsequent transfer of any such shares of Preferred Stock (except to the
Borrower or another Restricted Subsidiary) shall be deemed, in each case, to be
an issuance of shares of Preferred Stock;

(ix) Indebtedness of a Restricted Subsidiary to Holdings or another Restricted
Subsidiary; provided that if a Guarantor Incurs such Indebtedness to a
Restricted Subsidiary that is not a Guarantor such Indebtedness is subordinated
in right of payment to the Guaranteed Obligations of such Guarantor; provided,
further, that any subsequent issuance or transfer of any Capital Stock or any
other event which results in any Restricted Subsidiary lending such Indebtedness
ceasing to be a Restricted Subsidiary or any other subsequent transfer of any
such Indebtedness (except to the Borrower or another Restricted Subsidiary)
shall be deemed, in each case, to be an Incurrence of such Indebtedness;

(x) Hedging Obligations that are Incurred in the ordinary course of business
(and not for speculative purposes) not to exceed $25.0 million at any one time
outstanding: (1) for the purpose of fixing or hedging interest rate risk with
respect to any Indebtedness that is permitted by the terms of this Agreement to
be outstanding; (2) for the purpose of fixing or hedging currency exchange rate
risk with respect to any currency exchanges; or (3) for the purpose of fixing or
hedging commodity price risk with respect to any commodity purchases;

(xi) obligations (including reimbursement obligations with respect to letters of
credit and bank guarantees) in respect of performance, bid, appeal and surety
bonds and completion guarantees provided by Holdings or any Restricted
Subsidiary in the ordinary course of business;

(xii) Indebtedness or Disqualified Stock of Holdings or any Restricted
Subsidiary of Holdings and Preferred Stock of any Restricted Subsidiary of the
Borrower in an aggregate principal amount or liquidation preference which, when
aggregated with the principal amount or liquidation preference of all other
Indebtedness, Disqualified Stock and Preferred Stock then outstanding and
Incurred pursuant to this clause (xii), does not exceed $18.75 million at any
one time outstanding; provided, however, that notwithstanding the foregoing
provision, any Unsecured Indebtedness that is pari passu with the Second Lien
Notes in right of payment, or any Secured Indebtedness that is secured with a
Lien on the Collateral on a pari passu basis with the Lien securing the Second
Lien Notes Incurred under this clause (xii) may not exceed $6.25 million at any
one time outstanding, and provided further that no Indebtedness that is senior
to the Second Lien Notes in right of payment or is Secured Indebtedness that is
secured with a Lien on the Collateral having a senior priority to the Lien
securing the Second Lien Notes may be incurred under this clause (xii);

(xiii) any guarantee by Holdings or a Restricted Subsidiary of Indebtedness or
other obligations of Holdings or any of its Restricted Subsidiaries so long as
the Incurrence of such Indebtedness or other obligations by Holdings or such
Restricted Subsidiary

 

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is permitted under the terms of this Agreement; provided that if such
Indebtedness is by its express terms subordinated in right of payment to the
Loans or the Guarantee of such Restricted Subsidiary, as applicable, any such
guarantee of such Guarantor with respect to such Indebtedness shall be
subordinated in right of payment to such Guarantor’s Guaranteed Obligations with
respect to the Loans substantially to the same extent as such Indebtedness is
subordinated to the Loans or the Guaranteed Obligations of such Restricted
Subsidiary, as applicable;

(xiv) the Incurrence by Holdings or any of its Restricted Subsidiaries of
Indebtedness or Disqualified Stock or Preferred Stock of a Restricted Subsidiary
of Holdings which serves to refund, refinance or defease any Indebtedness,
Disqualified Stock or Preferred Stock Incurred as permitted under clauses (ii),
(iii)(A), this clause (xiv), (xv), (xviii), (xx) and (xxii) of this Section 3(b)
or any Indebtedness, Disqualified Stock or Preferred Stock Incurred to so refund
or refinance such Indebtedness, Disqualified Stock or Preferred Stock, including
any additional Indebtedness, Disqualified Stock or Preferred Stock Incurred to
pay premiums, fees and expenses in connection therewith (subject to the
following proviso, “Refinancing Indebtedness”) prior to its respective maturity;
provided, however, that such Refinancing Indebtedness:

(A) has a Weighted Average Life to Maturity at the time such Refinancing
Indebtedness is Incurred which is not less than the remaining Weighted Average
Life to Maturity of the Indebtedness being refunded or refinanced;

(B) has a Stated Maturity which is no earlier than the Stated Maturity of the
Indebtedness being refunded or refinanced;

(C) to the extent such Refinancing Indebtedness refinances (x) Subordinated
Indebtedness, such Refinancing Indebtedness also constitutes Subordinated
Indebtedness or (y) Disqualified Stock or Preferred Stock, such Refinancing
Indebtedness is Disqualified Stock or Preferred Stock;

(D) is Incurred in an aggregate principal amount (or if issued with original
issue discount, an aggregate issue price) that is equal to or less than the sum
of (x) the aggregate principal amount (or if issued with original issue
discount, the aggregate accreted value) then outstanding of the Indebtedness
being refinanced plus (y) the amount of premium, fees and expenses Incurred in
connection with such refinancing; and

(E) shall not include (x) Indebtedness of a Restricted Subsidiary of Holdings
that is not the Borrower or a Guarantor that refinances Indebtedness of
Holdings, the Borrower or a Guarantor, or (y) Indebtedness of Holdings or a
Restricted Subsidiary that refinances Indebtedness of an Unrestricted
Subsidiary;

and provided further that any Refinancing Indebtedness incurred with respect to
Senior Notes that remain outstanding on the Closing Date after giving effect to
the Refinancing Transactions (x) must be subordinated to the Loans in right of
payment and, (y) if secured, must be secured on a subordinated basis with the
Loans and (z) must otherwise comply with the provisions relating to the Senior
Notes under Section 4(b)(iii);

 

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(xv) Indebtedness, Disqualified Stock or Preferred Stock, not to exceed $37.5
million at any one time outstanding, (x) of Holdings or any of its Restricted
Subsidiaries Incurred to finance an acquisition and (y) of Persons that are
acquired by Holdings or any of its Restricted Subsidiaries or merged into
Holdings or a Restricted Subsidiary in accordance with the terms of this
Agreement; provided, however, that after giving effect to such acquisition and
the Incurrence of such Indebtedness, Disqualified Stock or Preferred Stock,
either:

(A) the Fixed Charge Coverage Ratio of Holdings and its Subsidiaries on a
consolidated basis for the most recently ended four full fiscal quarters for
which financial statements are available immediately preceding the date of such
acquisition would have been at least 1.50 to 1.00 determined on a pro forma
basis (including a pro forma application of the net proceeds therefrom), as if
the additional Indebtedness had been Incurred, or the Disqualified Stock or
Preferred Stock had been issued, as the case may be, and the application of
proceeds therefrom had occurred at the beginning of such four-quarter period; or

(B) the Fixed Charge Coverage Ratio of Holdings and its Subsidiaries on a
consolidated basis after giving pro forma effect to such acquisition for the
most recently ended four full fiscal quarters for which financial statements are
available immediately preceding the date of such acquisition would be greater
than immediately prior to such acquisition;

(C) provided further, however, that (A) any such Indebtedness has a Stated
Maturity at least six months later than the Stated Maturity of the Second Lien
Notes and (B) any such Indebtedness of Holdings, the Borrower or a Guarantor
shall either be Unsecured Indebtedness or Secured Indebtedness that is secured
with a Lien on the Collateral on a junior basis to the Lien securing the Second
Lien Notes;

(xvi) Indebtedness arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument drawn against insufficient
funds in the ordinary course of business; provided that such Indebtedness is
extinguished within five Business Days of its Incurrence;

(xvii) Indebtedness of Holdings or any Restricted Subsidiary supported by a
letter of credit or bank guarantee issued pursuant to the First Lien Credit
Agreement, in a principal amount not in excess of the stated amount of such
letter of credit or bank guarantee;

(xviii) Contribution Indebtedness;

(xix) Indebtedness in an aggregate amount not to exceed $31.25 million at any
one time outstanding of Holdings or any Restricted Subsidiary consisting of
(x) the financing of insurance premiums or (y) take-or-pay obligations contained
in supply arrangements, in the case of each of clauses (x) and (y), in the
ordinary course of business and on an unsecured basis;

 

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(xx) Indebtedness of Foreign Subsidiaries of Holdings in an aggregate amount not
to exceed $12.5 million at any one time outstanding;

(xxi) [reserved]; and

(xxii) Indebtedness under the Foreign L/C Facility in an aggregate principal
amount not to exceed $37.5 million at any time outstanding; provided that such
Indebtedness may be recourse to Holdings, but shall not be secured by a Lien on
the assets of Holdings, the Borrower or any Subsidiary Guarantor.

(c) For purposes of determining compliance with this Section 3, in the event
that an item of Indebtedness, Disqualified Stock or Preferred Stock (or any
portion thereof) meets the criteria of more than one of the categories of
Permitted Debt or is entitled to be Incurred pursuant to Section 3(a), the
Borrower shall, in its sole discretion, at the time of Incurrence, divide,
classify or reclassify, or at any later time divide, classify or reclassify,
such item of Indebtedness, Disqualified Stock or Preferred Stock (or any portion
thereof) in any manner that complies with this Section 3; provided that all
Indebtedness under the First Lien Credit Agreement outstanding on the Closing
Date shall be deemed to have been Incurred pursuant to clause (i) of
Section 3(b), and the Borrower shall not be permitted to reclassify all or any
portion of such Indebtedness. Accrual of interest, the accretion of accreted
value, the amortization of original issue discount, the payment of interest in
the form of additional Indebtedness with the same terms, the payment of
dividends on Disqualified Stock or Preferred Stock in the form of additional
shares of Disqualified Stock or Preferred Stock of the same class, the accretion
of liquidation preference and increases in the amount of Indebtedness
outstanding solely as a result of fluctuations in the exchange rate of
currencies shall not be deemed to be an Incurrence of Indebtedness, Disqualified
Stock or Preferred Stock for purposes of this Section 3. Guarantees of, or
obligations in respect of letters of credit relating to, Indebtedness which are
otherwise included in the determination of a particular amount of Indebtedness
shall not be included in the determination of such amount of Indebtedness;
provided that the Incurrence of the Indebtedness represented by such guarantee
or letter of credit, as the case may be, was in compliance with this Section 3.

(d) For purposes of determining compliance with any U.S. dollar-denominated
restriction on the Incurrence of Indebtedness, the U.S. dollar-equivalent
principal amount of Indebtedness denominated in a foreign currency shall be
calculated based on the relevant currency exchange rate in effect on the date
such Indebtedness was Incurred, in the case of term debt, or first committed or
first Incurred (whichever yields the lower U.S. dollar equivalent), in the case
of revolving credit debt; provided that if such Indebtedness is Incurred to
refinance other Indebtedness denominated in a foreign currency, and such
refinancing would cause the applicable U.S. dollar-denominated restriction to be
exceeded if calculated at the relevant currency exchange rate in effect on the
date of such refinancing, such U.S. dollar-denominated restriction shall be
deemed not to have been exceeded so long as the principal amount of such
refinancing Indebtedness does not exceed the principal amount of such
Indebtedness being refinanced.

(e) For purposes of this Agreement, (1) Unsecured Indebtedness shall not be
treated as subordinated in right of payment to any Secured Indebtedness merely
because it is

 

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unsecured, (2) senior Indebtedness that is Secured Indebtedness shall not be
treated as subordinated in right of payment to any other Secured Indebtedness
merely because it has a junior priority with respect to the same collateral,
(3) Indebtedness shall not be treated as subordinated in right of payment to any
other Indebtedness merely because of maturity date, order of payment or order of
application of funds and (4) Indebtedness that is not guaranteed shall not be
treated as subordinated in right of payment to any other Indebtedness that is
guaranteed merely because it is not guaranteed.

Section 4 Limitation on Restricted Payments.

(a) Holdings and the Borrower shall not, and shall not permit any of the
Restricted Subsidiaries to, directly or indirectly:

(i) declare or pay any dividend or make any distribution on account of Holdings’
or any of its Restricted Subsidiaries’ Equity Interests, including any payment
made in connection with any merger or consolidation involving the Borrower
(other than (A) dividends or distributions by Holdings payable solely in Equity
Interests (other than Disqualified Stock) of Holdings; or (B) dividends or
distributions by Holdings or a Restricted Subsidiary so long as, in the case of
any dividend or distribution payable on or in respect of any class or series of
securities issued by a Restricted Subsidiary other than a Wholly Owned
Restricted Subsidiary, Holdings or a Restricted Subsidiary receives at least its
pro rata share of such dividend or distribution in accordance with its Equity
Interests in such class or series of securities);

(ii) purchase or otherwise acquire or retire for value any Equity Interests of
the Borrower or Holdings or any other direct or indirect parent of the Borrower;

(iii) make any principal payment on, or redeem, repurchase, defease or otherwise
acquire or retire for value, in each case prior to any scheduled repayment or
scheduled maturity, any Senior Notes that remain outstanding after the
consummation of the Refinancing Transactions;

(iv) make any principal payment on, or redeem, repurchase, defease or otherwise
acquire or retire for value, in each case prior to any scheduled repayment or
scheduled maturity, any Subordinated Indebtedness (other than the payment,
redemption, repurchase, defeasance, acquisition or retirement of
(A) Subordinated Indebtedness in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each case due within one
year of the date of such payment, redemption, repurchase, defeasance,
acquisition or retirement and (B) Indebtedness permitted under clauses (vii) and
(ix) of Section 3(b)); or

(v) make any Restricted Investment;

(all such payments and other actions set forth in clauses (i) through (v) above
being collectively referred to as “Restricted Payments”).

(b) The provisions of Section 4(a) shall not prohibit:

(i) [reserved];

 

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(ii) (A) the redemption, repurchase, retirement or other acquisition of
(x) Senior Notes that remain outstanding after the consummation of the
Refinancing Transactions in exchange for, or out of the proceeds of the
substantially concurrent sale of, Equity Interests of the Borrower or any other
direct or indirect parent of the Borrower or contributions to the equity capital
of the Borrower (other than any Disqualified Stock or any Equity Interests sold
to a Subsidiary of the Borrower or to an employee stock ownership plan or any
trust established by the Borrower or any of its Subsidiaries), or
(y) Subordinated Indebtedness of Holdings or any Restricted Subsidiary), in
exchange for, or out of the proceeds of the substantially concurrent sale of,
Equity Interests of Holdings or any direct or indirect parent of Holdings or
contributions to the equity capital of Holdings (other than any Disqualified
Stock or any Equity Interests sold to a Subsidiary of Holdings or to an employee
stock ownership plan or any trust established by Holdings or any of its
Subsidiaries), or (z) Subordinated Indebtedness of the Borrower or any
Restricted Subsidiary, in exchange for, or out of the proceeds of the
substantially concurrent sale of, Equity Interests of the Borrower or any direct
or indirect parent of the Borrower or contributions to the equity capital of the
Borrower (other than any Disqualified Stock or any Equity Interests sold to a
Subsidiary of the Borrower or to an employee stock ownership plan or any trust
established by the Borrower or any of its Subsidiaries) (collectively, including
any such contributions, “Refunding Capital Stock”);

(B) [reserved];

(C) the redemption, repurchase, retirement, or other acquisition of Equity
Interests (the “Retired Capital Stock”) of the Borrower or Holdings or any other
direct or indirect parent of the Borrower solely in exchange for Equity
Interests of the Borrower or Holdings or any other direct or indirect parent of
the Borrower (other than any Disqualified Stock); and

(D) the declaration and payment of accrued dividends on the Retired Capital
Stock out of the proceeds of the substantially concurrent sale (other than to a
Subsidiary of Holdings or to an employee stock ownership plan or any trust
established by Holdings or any of its Subsidiaries) of Refunding Capital Stock;

(iii) the redemption, repurchase or other acquisition or retirement of
(x) Senior Notes that remain outstanding after the consummation of the
Refinancing Transactions or (y) Subordinated Indebtedness of the Borrower or any
Guarantor, in each case, made by exchange for, or out of the proceeds of the
substantially concurrent sale of, new Indebtedness of the Borrower or any
Guarantor which is Incurred in accordance with Section 3 so long as:

(A) the principal amount of such new Indebtedness does not exceed the principal
amount of the Subordinated Indebtedness or Senior Notes being so redeemed,
repurchased, acquired or retired for value (plus the amount of any premium
required to be paid under the terms of the instrument governing the Subordinated
Indebtedness or Senior Notes being so redeemed, repurchased, acquired or retired
plus any fees and expenses Incurred in connection therewith);

(B) with respect to Senior Notes, such new Indebtedness is subordinated in right
of payment to the Loans or the related Guaranteed Obligations, as

 

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the case may be, and (ii) with respect to Subordinated Indebtedness of the
Borrower or any Guarantor, such new Indebtedness is subordinated in right of
payment to the Loans or the related Guaranteed Obligations, as the case may be,
at least to the same extent as such Subordinated Indebtedness so purchased,
exchanged, redeemed, repurchased, acquired or retired for value;

(C) with respect to Senior Notes, such new Indebtedness has a Stated Maturity
after the Stated Maturity of the Second Lien Notes and (ii) with respect to
Subordinated Indebtedness, such new Indebtedness has a Stated Maturity no
earlier than the Stated Maturity of the Subordinated Indebtedness being so
redeemed, repurchased, acquired or retired;

(D) such new Indebtedness has a Weighted Average Life to Maturity which is not
less than the remaining Weighted Average Life to Maturity of the Subordinated
Indebtedness or Senior Notes being so redeemed, repurchased, acquired or
retired; and

(E) (i) with respect to Senior Notes, such new Indebtedness shall be secured on
a subordinated basis with the Loans or Unsecured Indebtedness, (ii) with respect
to Subordinated Indebtedness that is Unsecured Indebtedness, such new
Indebtedness shall be Unsecured Indebtedness and (iii) with respect to
Subordinated Indebtedness that is Secured Indebtedness and secured with a Lien
on the Collateral having a junior priority to the Lien securing the Loans, such
new Indebtedness shall either be Unsecured Indebtedness or shall be Secured
Indebtedness secured with a Lien on the Collateral having a junior priority to
the Lien securing the Loans;

(iv) the repurchase, retirement or other acquisition (or dividends to Holdings
or any other direct or indirect parent of Holdings to finance any such
repurchase, retirement or other acquisition) for value of Equity Interests of
the Borrower or Holdings or any other direct or indirect parent of the Borrower
held by any future, present or former employee, director or consultant of the
Borrower or Holdings or any other direct or indirect parent of the Borrower or
any Subsidiary of the Borrower pursuant to any management equity plan or stock
option plan or any other management or employee benefit plan or other agreement
or arrangement; provided, however, that the aggregate amounts paid under this
clause (iv) do not exceed $2.5 million in any calendar year (with unused amounts
in any calendar year being permitted to be carried over for the next two
succeeding calendar years up to a maximum of $5.0 million in the aggregate in
any calendar year); provided, further, however, that such amount in any calendar
year may be increased by an amount not to exceed:

(A) the cash proceeds received by Holdings or any of its Restricted Subsidiaries
from the sale of Equity Interests (other than Disqualified Stock) of the
Borrower or Holdings or any other direct or indirect parent of the Borrower (to
the extent contributed to the Borrower) to members of management, directors or
consultants of the Borrower and its Restricted Subsidiaries or Holdings or any
other direct or indirect parent of the Borrower that occurs after the Closing
Date (provided that the amount of such cash proceeds utilized for any such
repurchase, retirement, other acquisition or dividend shall not increase the
amount otherwise available for Restricted Payments under any clause of this
Section 4 other than this Section 4(a)(iv)); plus

 

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(B) the cash proceeds of key man life insurance policies received by the
Borrower or Holdings or any other direct or indirect parent of the Borrower (to
the extent contributed to the Borrower) and its Restricted Subsidiaries after
the Closing Date;

(provided that the Borrower may elect to apply all or any portion of the
aggregate increase contemplated by clauses (A) and (B) above in any calendar
year);

(v) [reserved];

(vi) [reserved];

(vii) Investments in Unrestricted Subsidiaries having an aggregate Fair Market
Value, taken together with all other Investments made pursuant to this clause
(vii) that are at that time outstanding, not to exceed the greater of (x) $31.25
million and (y) 1.60% of Total Assets, at the time of such Investment (with the
Fair Market Value of each Investment being measured at the time made and without
giving effect to subsequent changes in value), at any one time outstanding;

(viii) [reserved];

(ix) Restricted Payments that are made with Excluded Contributions;

(x) [reserved];

(xi) [reserved];

(xii) the payment of dividends or other distributions to Holdings or any other
direct or indirect parent of the Borrower in amounts required for Holdings or
such other parent company to pay federal, state or local income taxes (as the
case may be) imposed directly on such entity to the extent such income taxes are
attributable to the income of the Borrower and its Restricted Subsidiaries by
virtue of such entity being the common parent of a consolidated or combined tax
group of which the Borrower and/or its Restricted Subsidiaries are members;
provided, however, that in each case the amount of such payments in respect of
any tax year does not exceed the amount that the Borrower and its Restricted
Subsidiaries would have been required to pay in respect of federal, state or
local taxes (as the case may be) in respect of such year if the Borrower and its
Restricted Subsidiaries paid such taxes directly as a stand-alone taxpayer (or
stand-alone group);

(xiii) the payment of dividends, other distributions or other amounts to, or the
making of loans to Holdings or any other direct or indirect parent, other than
the Sponsor, solely in the amount required for such entity to, if applicable:

(A) pay amounts equal to the amounts required for Holdings or any other direct
or indirect parent of the Borrower, other than the Sponsor, to pay fees

 

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and expenses (including franchise or similar taxes) required to maintain its
corporate existence, customary salary, bonus and other benefits payable to, and
indemnities provided on behalf of, officers and employees of Holdings or any
other direct or indirect parent of the Borrower, if applicable, and ordinary
course fees, expenses, salaries, bonuses, benefits, and indemnities of Holdings
or any other direct or indirect parent of the Borrower, other than the Sponsor,
paid to service providers that are non-Affiliates of the Borrower, if
applicable, in each case to the extent such fees, expenses, salaries, bonuses,
benefits and indemnities are directly attributable to the ownership or operation
of the Borrower, if applicable, and its Subsidiaries; provided that, for the
avoidance of doubt, no ordinary course fees, expenses, salaries, bonuses,
benefits and indemnities or general administrative, corporate operating,
overhead and other customary and ordinary course fees and expenses not directly
attributable to the Borrower and its Subsidiaries may be paid under this
Section 4(xiii)(A); and

(B) pay fees and expenses Incurred by Holdings related to any unsuccessful
equity or debt offering of Holdings;

(xiv) the making of loans to Holdings or any other direct or indirect parent of
the Borrower, other than the Sponsor, to, fund the payment of fees and expenses
owed by the Borrower or Holdings or any other direct or indirect parent of the
Borrower, other than the Sponsor, as the case may be, or Restricted Subsidiaries
of the Borrower to Affiliates, other than the Sponsor, in each case to the
extent permitted by Section 7;

(xv) repurchases of Equity Interests deemed to occur upon exercise of stock
options or warrants if such Equity Interests represent a portion of the exercise
price of such options or warrants; provided that no cash payments shall be
permitted pursuant to this Section 4(b)(xv);

(xvi) [reserved];

(xvii) the payment, purchase, redemption, defeasance or other acquisition or
retirement for value of Subordinated Indebtedness, Disqualified Stock or
Preferred Stock of the Borrower and its Restricted Subsidiaries pursuant to
provisions similar to those described under Sections 4.06 and 4.08 under the
Second Lien Indenture (as in effect on the date hereof);

(xviii) [reserved]; and

(xix) any Restricted Payments made in connection with the consummation of the
Refinancing Transactions as described in the Offering Memorandum;

provided, however, that at the time of, and after giving effect to, any
Restricted Payment permitted under this Section 4(b), no Default or Event of
Default shall have occurred and be continuing or would occur as a consequence
thereof.

(c) As of the Closing Date, all of the Borrower’s Subsidiaries shall be
Restricted Subsidiaries, except for Global Linguist Solutions LLC, which will be
an Unrestricted Subsidiary. The Borrower shall not permit any Unrestricted
Subsidiary to become a Restricted Subsidiary except pursuant to the definition
of “Unrestricted Subsidiary.” For purposes of

 

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designating any Restricted Subsidiary as an Unrestricted Subsidiary, all
outstanding Investments by the Borrower and its Restricted Subsidiaries (except
to the extent repaid) in the Subsidiary so designated shall be deemed to be
Restricted Payments or Permitted Investments in an amount determined as set
forth in the last sentence of the definition of “Investments.” Such designation
shall only be permitted if a Restricted Payment or Permitted Investment in such
amount would be permitted at such time and if such Subsidiary otherwise meets
the definition of an Unrestricted Subsidiary.

Section 5 Dividend and Other Payment Restrictions Affecting Subsidiaries.
Holdings and the Borrower shall not, and shall not permit any of the Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or consensual restriction
on the ability of any Restricted Subsidiary to:

(a) (i) pay dividends or make any other distributions to Holdings or any of its
Restricted Subsidiaries (1) on its Capital Stock or (2) with respect to any
other interest or participation in, or measured by, its profits; or (ii) pay any
Indebtedness owed to Holdings or any of its Restricted Subsidiaries;

(b) make loans or advances to Holdings or any of its Restricted Subsidiaries; or

(c) sell, lease or transfer any of its properties or assets to Holdings or any
of its Restricted Subsidiaries;

except in each case for such encumbrances or restrictions existing under or by
reason of:

(i) contractual encumbrances or restrictions in effect or entered into on the
Closing Date pursuant to (x) the First Lien Credit Agreement, (y) the Second
Lien Notes and (z) pursuant to any other agreement in effect on the Closing
Date;

(ii) this Agreement, the Collateral Documents, the Intercreditor Agreement, and
guarantees thereof;

(iii) applicable law or any applicable rule, regulation or order;

(iv) any agreement or other instrument of a Person acquired by Holdings or any
Restricted Subsidiary which was in existence at the time of such acquisition
(but not created in contemplation thereof), which encumbrance or restriction is
not applicable to any Person, or the properties or assets of any Person, other
than the Person, or the property or assets of the Person, so acquired; provided
that such encumbrance or restriction does not adversely affect the Borrower’s
ability to make interest and principal payments on the Loans;

(v) contracts or agreements for the sale of assets, including customary
restrictions with respect to a Restricted Subsidiary imposed pursuant to an
agreement entered into for the sale or disposition of all or substantially all
the Capital Stock or assets of such Restricted Subsidiary;

 

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(vi) restrictions on cash or other deposits or net worth imposed by customers
under contracts entered into in the ordinary course of business;

(vii) customary provisions in joint venture agreements entered into in the
ordinary course of business;

(viii) purchase money obligations for property acquired and Capitalized Lease
Obligations in the ordinary course of business (and permitted under the
Collateral Documents) that impose restrictions of the nature discussed in clause
(c) above on the property so acquired;

(ix) customary provisions contained in leases, licenses, contracts and other
similar agreements entered into in the ordinary course of business that impose
restrictions of the type described in clause (c) above on the property subject
to such lease;

(x) [reserved];

(xi) other Indebtedness, Disqualified Stock or Preferred Stock of any Restricted
Subsidiary of Holdings that is Incurred subsequent to the Closing Date pursuant
to Section 3; provided that such encumbrances and restrictions contained in any
agreement or instrument will not materially affect the Borrower’s ability to
make anticipated principal or interest payment on the Loans (as determined by
the Borrower in good faith);

(xii) any Restricted Investment not prohibited by Section 4 and any Permitted
Investment;

(xiii) Secured Indebtedness otherwise permitted to be Incurred pursuant to
Sections 3 and 11 that limit the right of the debtor to dispose of the assets
securing such Indebtedness; and

(xiv) any encumbrances or restrictions of the type referred to in clauses (a),
(b) and (c) above imposed by any amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings of
the contracts, instruments or obligations referred to in clauses (i) through
(xiii) above; provided that such amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings are,
in the good faith judgment of the Borrower, no more restrictive as a whole with
respect to such dividend and other payment restrictions than those contained in
the dividend or other payment restrictions prior to such amendment,
modification, restatement, renewal, increase, supplement, refunding, replacement
or refinancing.

For purposes of determining compliance with this Section 5, (i) the priority of
any Preferred Stock in receiving dividends or liquidating distributions prior to
dividends or liquidating distributions being paid on common stock shall not be
deemed a restriction on the ability to make distributions on Capital Stock and
(ii) the subordination of loans or advances made to the Borrower or a Restricted
Subsidiary of the Borrower to other Indebtedness Incurred by the Borrower or any
such Restricted Subsidiary shall not be deemed a restriction on the ability to
make loans or advances.

 

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Section 6 Asset Sales.

(a) The Borrower shall not, and shall not permit any of its Restricted
Subsidiaries to, cause or make an Asset Sale, unless:

(i) the Borrower or any of its Restricted Subsidiaries, as the case may be,
receives consideration at the time of such Asset Sale at least equal to the Fair
Market Value (as determined in good faith by the Borrower) of the assets sold or
otherwise disposed of;

(ii) except in the case of a Permitted Asset Swap, at least 75% of the
consideration therefor received by the Borrower or such Restricted Subsidiary,
as the case may be, is in the form of Cash Equivalents; provided that the amount
of:

(A) any liabilities (as shown on the Borrower’s or such Restricted Subsidiary’s
most recent balance sheet or in the notes thereto) of the Borrower or any
Restricted Subsidiary of the Borrower (other than liabilities that are by their
terms subordinated to the Loans) that are assumed by the transferee of any such
assets, and

(B) any notes or other obligations or other securities or assets received by the
Borrower or such Restricted Subsidiary of the Borrower from such transferee that
are converted by the Borrower or such Restricted Subsidiary of the Borrower into
cash within 180 days of the receipt thereof (to the extent of the cash
received),

shall each be deemed to be Cash Equivalents for the purposes of this Section 6;

Section 7 Transactions with Affiliates.

(a) Holdings and the Borrower shall not, and shall not permit any of the
Restricted Subsidiaries to, directly or indirectly, make any payment to, or
sell, lease, transfer or otherwise dispose of any of its properties or assets
to, or purchase any property or assets from, or enter into or make or amend any
transaction or series of transactions, contract, agreement, understanding, loan,
advance or guarantee with, or for the benefit of, any Affiliate of Holdings
(each of the foregoing, an “Affiliate Transaction”) involving aggregate
consideration in excess of $1.25 million, unless such Affiliate Transaction is
on terms that are not materially less favorable to Holdings or the relevant
Restricted Subsidiary than those that could have been obtained in a comparable
transaction by Holdings or such Restricted Subsidiary with an unrelated Person;

(b) The provisions of Section 7(a) shall not apply to the following:

(i) (A) transactions between or among Holdings and/or any of its Restricted
Subsidiaries (or an entity that becomes a Restricted Subsidiary as a result of
such transaction) and (B) any merger or consolidation of the Borrower and
Holdings or any other direct parent of the Borrower; provided that such parent
company shall have no material liabilities and no material assets other than
cash, Cash Equivalents and the Capital Stock of the Borrower, or Holdings, as
applicable, and such merger or consolidation is otherwise in compliance with the
terms of this Agreement and effected for a bona fide business purpose;

 

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(ii) (A) Restricted Payments permitted by Section 4 and (B) Permitted
Investments;

(iii) the payment of reasonable and customary fees paid to, and indemnity
provided on behalf of, officers, directors, employees or consultants of Holdings
or any Restricted Subsidiary of Holdings or any other direct or indirect parent
of the Borrower;

(iv) [reserved];

(v) payments or loans (or cancellation of loans) to employees or consultants in
the ordinary course of business which are approved by a majority of the members
of the Board of Directors of the Borrower or Holdings in good faith, excluding,
for the avoidance of doubt, any such payments or loans made pursuant to clause
(vi) below;

(vi) the Master Consulting and Advisory Services Agreement as in effect on the
Closing Date or any amendment thereto or any transaction contemplated thereby;
provided that the Borrower may make payments, not to exceed $7.5 million in any
fiscal year, with respect to (A) executives seconded to the Borrower or any of
its Restricted Subsidiaries from Cerberus Operations and Advisory Company LLC
and (B) personnel of Cerberus Operations and Advisory Company LLC that provide
services to the Borrower or any of its Restricted Subsidiaries at cost on a
weekly, monthly or pro-rated basis;

(vii) [reserved];

(viii) (A) transactions with customers, clients, suppliers or purchasers or
sellers of goods or services, in each case in the ordinary course of business
and otherwise in compliance with the terms of this Agreement, which are fair to
Holdings and its Restricted Subsidiaries in the reasonable determination of the
Board of Directors or the senior management of Holdings, and are on terms at
least as favorable as might reasonably have been obtained at such time from an
unaffiliated party or (B) transactions with Unrestricted Subsidiaries entered
into in the ordinary course of business;

(ix) [reserved];

(x) the issuance of Equity Interests (other than Disqualified Stock) of the
Borrower or Holdings to any Permitted Holder or to Holdings or any other direct
or indirect parent of the Borrower or Holdings or to any director, officer,
employee or consultant thereof;

(xi) [reserved];

(xii) [reserved];

(xiii) any contribution to the capital of Holdings or the Borrower;

(xiv) transactions permitted by, and complying with, the provisions of
Section 21;

 

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(xv) transactions between Holdings or any of its Restricted Subsidiaries and any
Person, a director of which is also a director of the Borrower or Holdings or
any other direct or indirect parent of the Borrower; provided, however, that
such director abstains from voting as a director of the Borrower or such direct
or indirect parent of the Borrower, as the case may be, on any matter involving
such other Person;

(xvi) pledges of Equity Interests of Unrestricted Subsidiaries;

(xvii) any employment agreements entered into by Holdings or any of its
Restricted Subsidiaries in the ordinary course of business;

(xviii) the issuances of securities or other payments, awards or grants in cash,
securities or otherwise pursuant to, or the funding of, employment arrangements,
stock option and stock ownership plans or similar employee benefit plans
approved by the Board of Directors of the Borrower or Holdings or any other
direct or indirect parent of the Borrower or of a Restricted Subsidiary of the
Borrower, as appropriate, in good faith;

(xix) the entering into of any tax sharing agreement or arrangement and any
payments permitted by Section 4(b)(xii);

(xx) transactions to effect the Refinancing Transactions, including entry into
this Agreement, entry into the security documents relating thereto and
performance of the obligations of the Borrower and its Restricted Subsidiaries
thereunder, and the payment of all fees and expenses related to the Refinancing
Transactions;

(xxi) payments for back office shared services that are paid at cost (subject to
any higher transfer pricing required in certain foreign operations) pursuant to
contractual joint venture arrangements pursuant to which Holdings or any of its
Restricted Subsidiaries are party, in the ordinary course of business; provided
that the exception under this clause (xxi) shall not permit any payments to the
Sponsor;

(xxii) transactions with the Sponsor permitted under the First Lien Credit
Agreement as in effect on the Closing Date solely to the extent (x) directly
related to its Class B Revolving Credit Commitment(s) (as defined in the First
Lien Credit Agreement) or Class B Revolving Credit Loan(s) (as defined in the
First Lien Credit Agreement) thereunder and (y) on the same terms as for similar
transactions with Class B Revolving Credit Lenders (as defined in the First Lien
Credit Agreement) thereunder; and

(xxiii) transactions with any Debt Fund Affiliate (as defined in the First Lien
Credit Agreement) or Non-Debt Fund Affiliate (as defined in the First Lien
Credit Agreement) permitted by the First Lien Credit Agreement solely to the
extent (i) directly related to its commitment(s) or loan(s) thereunder and
(ii) on the same terms as for similar transactions with other lenders of the
applicable class thereunder.

Section 8 Change of Control.

(a) Subject to the Intercreditor Agreement, upon the occurrence of a Change of
Control, Lender shall have the right to require the Borrower to repay all or any
part of such

 

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Lender’s Loans at a purchase price in cash equal to 101% of the principal amount
thereof, plus accrued and unpaid interest to the date of repayment, in
accordance with the terms contemplated in this Section 8; provided, however,
that notwithstanding the occurrence of a Change of Control, the Borrower shall
not be obligated to repay any Loans pursuant to this Section 8 in the event that
it has exercised its right to repay the Loans in accordance with Section 2.4 of
this Agreement.

In the event that at the time of such Change of Control the terms of the First
Lien Credit Agreement, Second Lien Indenture or the Intercreditor Agreement,
restrict or prohibit the repayment of Loans pursuant to this Section 8, then
prior to the mailing of the notice to the Lender provided for in Section 4(b)
but in any event within 30 days following any Change of Control, the Borrower
shall (i) (x) repay in full the First Lien Credit Agreement and (y) repay in
full the Second Lien Notes or (ii) obtain the requisite consent, if required,
under the First Lien Credit Agreement and the Second Lien Indenture to permit
the repayment of Loans as provided for in Section 8(b).

(b) Within 30 days following any Change of Control, except to the extent that
the Borrower has exercised its right to repay the Loans in accordance with
Section 2.4 of this Agreement, the Borrower shall mail a notice (a “Change of
Control Offer”) to Lender stating:

(i) that a Change of Control has occurred and that, subject to the Intercreditor
Agreement, Lender has the right to require the Borrower to repay all or a
portion of such Lender’s Loans at a purchase price in cash equal to 101% of the
principal amount thereof, plus accrued and unpaid interest to the date of
repayment;

(ii) the circumstances and relevant facts and financial information regarding
such Change of Control;

(iii) the repayment date (which shall be no earlier than 30 days nor later than
60 days from the date such notice is mailed); and

(iv) the instructions determined by the Borrower, consistent with this
Section 8, that Lender must follow in order to have its Loans repaid.

(c) If the Lender elects to have Loans repaid, it shall be required to surrender
any Notes , with an appropriate form duly completed, to the Borrower at the
address specified in the notice on the repayment date. The Lender shall be
entitled to withdraw its election if the Borrower receives not later than two
Business Days prior to the repayment date a telegram, telex, facsimile
transmission or letter setting forth a statement that the Lender is withdrawing
its election to have the Loans repaid.

(d) On the repayment date, subject to the Intercreditor Agreement, the Borrower
shall pay the repayment price plus accrued and unpaid interest to the Lender.

(e) Notwithstanding the foregoing provisions of this Section 8, the Borrower
shall not be required to make a Change of Control Offer upon a Change of Control
if a third party makes the Change of Control Offer in the manner, at the times
and otherwise in compliance with the requirements set forth in Section 8(b)
applicable to a Change of Control Offer made by the Borrower and repays all
Loans elected to be repaid and not withdrawn under such Change of Control Offer
in compliance with such requirements.

 

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(f) A Change of Control Offer may be made in advance of a Change of Control, and
conditioned upon such Change of Control, if a definitive agreement is in place
for the Change of Control at the time of making the Change of Control Offer.

Section 9 [Reserved].

Section 10 Future Guarantors. If (x) the Borrower acquires or creates any direct
or indirect Restricted Subsidiary that is not an Excluded Subsidiary after the
Closing Date (unless such Subsidiary is already a Guarantor) (y) any Excluded
Subsidiary ceases to constitute an Excluded Subsidiary or (z) any existing
Unrestricted Subsidiary is designated as a Restricted Subsidiary in accordance
with the provisions set forth under Section 4 and the definition of
“Unrestricted Subsidiary”, the Borrower shall cause such Restricted Subsidiary,
at the earlier of (A) within 45 days after the date of such acquisition,
formation, cessation or designation, or (B) concurrently (to the extent
reasonably practicable) with the guarantee under the First Lien Credit Agreement
or the Second Lien Indenture by such Subsidiary, to (1) execute and deliver to
the Lender a joinder to this Agreement pursuant to which such Subsidiary will
become a Guarantor under this Agreement and (2) execute and deliver to the
Lender a joinder to the Collateral Documents and take all actions necessary to
perfect the Liens created thereunder (to the extent required by the Collateral
Documents), all of such Liens to be subject to the Intercreditor Agreement.

Section 11 Liens. Holdings and the Borrower shall not, and shall not permit any
of the Restricted Subsidiaries to, directly or indirectly, create, Incur or
suffer to exist any Lien (other than Permitted Liens) on any asset, property or
revenues, whether owned on the Closing Date or acquired thereafter of Holdings,
the Borrower or any of the Restricted Subsidiaries.

Section 12 [Reserved].

Section 13 [Reserved].

Section 14 [Reserved].

Section 15 [Reserved].

Section 16 Corporate Existence. Subject to the provisions described under
Section 21, each of Holdings and the Borrower shall do or cause to be done all
things reasonably necessary to preserve and keep in full force and effect
(a) its corporate existence, and the corporate, partnership, limited liability
company or other existence of each of its Restricted Subsidiaries, in accordance
with the respective organizational documents (as the same may be amended from
time to time) of Holdings, the Borrower or any such Restricted Subsidiary and
(b) the material rights (charter and statutory), licenses and franchises of
Holdings, the Borrower and their Restricted Subsidiaries; provided, however,
that Holdings and the Borrower shall not be required to preserve any such right,
license or franchise, or the corporate, partnership, limited liability company
or other existence of any of their Restricted Subsidiaries, if Holdings or the
Borrower, as applicable shall determine that the preservation thereof is no
longer desirable in the

 

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conduct of the business of Holdings, the Borrower and its Restricted
Subsidiaries, taken as a whole; and provided further that this covenant does not
prohibit any transaction otherwise permitted by Section 6.

Section 17 Maintenance of Property; Insurance.

(a) Each of Holdings and the Borrower shall, and shall cause their Restricted
Subsidiaries to, cause all material properties owned by or leased by the
Borrower or any of its Restricted Subsidiaries used or useful to the conduct of
its business or the business of any of its Restricted Subsidiaries to be
maintained and kept in normal condition, repair and working order (ordinary wear
and tear excepted) and supplied with all reasonably necessary equipment and
shall cause to be made all repairs, renewals, replacements, and betterments
thereof, all as in its judgment may be reasonably necessary, so that the
business carried on in connection therewith may be properly conducted at all
times; provided, however, that nothing in this covenant shall prevent Holdings,
the Borrower or any of their Restricted Subsidiaries from discontinuing the use,
operation or maintenance of any of such properties, or disposing of any of them,
if such discontinuance or disposal is, in the judgment of the management of
Holdings, the Borrower or any such Restricted Subsidiary, necessary or desirable
in the conduct of the business of Holdings, the Borrower or any such Restricted
Subsidiary; and provided further that nothing in this covenant shall prevent
Holdings, the Borrower or any of its Restricted Subsidiaries from discontinuing
or disposing of any properties to the extent otherwise permitted by this
Agreement.

(b) Each of Holdings and the Borrower shall maintain, and shall cause their
Restricted Subsidiaries to maintain, insurance (including appropriate
self-insurance) with responsible carriers against such risks and in such
amounts, and with such deductibles, retentions, self-insured amounts and
co-insurance provisions, as are customarily, in the reasonable opinion of
Holdings or the Borrower, carried by similar businesses of similar size.

Section 18 Program Specific Accounts. The Borrower shall not permit, as of the
first day of each month, the amount of cash and Cash Equivalents deposited in
Program Specific Accounts to exceed the amounts necessary for anticipated
operating expenses (including payroll) and to comply with applicable statutory
or regulatory obligations in connection with the programs directly related to
such Program Specific Accounts for the following three-month period as
determined by the Borrower in good faith.

Section 19 After-Acquired Collateral; Further Assurances.

(a) From and after the Closing Date, subject to certain limitations and
exceptions (including the exclusion of any securities or other equity interests
of any of the Borrower’s Subsidiaries) and as otherwise set forth in the
Collateral Documents, the Intercreditor Agreement, the definition of “Collateral
and Guarantee Requirement” set forth in Section 1.01 and this Section 19), if
the Borrower or any Guarantor creates any additional security interest upon any
property or asset to secure any First Lien Obligations (which include
Obligations in respect of the First Lien Credit Agreement) or Permitted Second
Lien Obligations , it must concurrently grant a third-priority security interest
(subject only to the liens securing the First Lien Obligations, Permitted Second
Lien Obligations and certain other Permitted Liens) upon such property as
security for the Indebtedness and Obligations. If granting a security interest
in

 

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such property requires the consent of a third party, the Borrower will use
commercially reasonable efforts to obtain such consent with respect to the
third-priority security interest for the benefit of the Collateral Agent. If
such third party does not consent to the granting of the first-priority security
interest or second-priority security interest after the use of such commercially
reasonable efforts, the applicable entity will not be required to provide such
security interest, solely to the extent such security interest is not provided
under the First Lien Credit Agreement or Second Lien Notes.

(b) The Borrower and each Guarantor, at their sole cost and expense, shall take
all action necessary or, on or after the Discharge of the Second Lien
Obligations, reasonably requested by the Collateral Agent to ensure that the
Collateral and Guarantee Requirement continues to be satisfied including:

(i) each Guarantor that is newly formed, acquired or designated pursuant to
Section 10 to take all action necessary to ensure that the Collateral and
Guarantee Requirement continues to be satisfied, including, within 45 days after
such formation, acquisition, cessation or designation, or such longer period as
the Collateral Agent may agree in writing in its reasonable discretion:

(A) cause each Guarantor pursuant to the Collateral and Guarantee Requirement to
duly execute and deliver to the Collateral Agent (as appropriate) a joinder to
the Collateral Documents and take all actions necessary to perfect the Liens
created thereunder;

(B) cause each Guarantor pursuant to the Collateral and Guarantee Requirement
(and the parent of each such Subsidiary that is a Guarantor) to deliver any and
all certificates representing Equity Interests (to the extent certificated) and
intercompany notes (to the extent certificated) that are required to be pledged
pursuant to the Collateral and Guarantee Requirement, accompanied by undated
stock powers or other appropriate instruments of transfer executed in blank;

(C) take and cause such Guarantor pursuant to the Collateral and Guarantee
Requirement and each direct or indirect parent of such Restricted Subsidiary to
take whatever action (including the recording of mortgages, the filing of UCC
financing statements and delivery of stock and membership interest certificates)
as may be necessary or as the Collateral Agent may reasonably request to vest in
the Collateral Agent (or in any representative of the Collateral Agent
designated by it) valid and perfected Liens to the extent required by the
Collateral and Guarantee Requirement or the Collateral Documents, and to
otherwise comply with the requirements of the Collateral and Guarantee
Requirement or the Collateral Documents;

(ii) as promptly as practicable after the request therefor by the Collateral
Agent, deliver to the Collateral Agent with respect to each Material Real
Property, any existing title reports, abstracts or environmental assessment
reports, to the extent available and in the possession or control of the
Borrower; provided, however, that there shall be no obligation to deliver to the
Collateral Agent any existing environmental assessment report whose disclosure
to the Collateral Agent would require the consent of a Person other than
Holdings or one of its Subsidiaries, where, despite the commercially reasonable
efforts of the Borrower to obtain such consent, such consent cannot be obtained;
and

 

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(iii) if reasonably requested by the Collateral Agent, within sixty (60) days
after such request or such longer period as the Collateral Agent may agree in
writing in its reasonable discretion), deliver to the Collateral Agent any other
items necessary from time to time to satisfy the Collateral and Guarantee
Requirement with respect to perfection and existence of security interests with
respect to property of any Guarantor acquired after the Closing Date and subject
to the Collateral and Guarantee Requirement or the Collateral Documents, but not
specifically covered by the preceding clauses (A), (B) or (C) or clause
(iv) below;

(iv) not later than 60 days after the acquisition by the Borrower or any
Guarantor of Material Real Property (or such longer period as the Collateral
Agent may agree) that is required to be provided as Collateral pursuant to the
Collateral and Guarantee Requirement, which property would not be automatically
subject to another Lien pursuant to pre-existing Collateral Documents, each such
acquiring Borrower or Guarantor to cause such property to be subject to a Lien
and mortgage in favor of the Collateral Agent and take, or Holdings to cause the
relevant Borrower or Guarantor to take, such actions as shall be necessary or
reasonably requested by the Collateral Agent to grant and perfect or record such
Lien, in each case to the extent required by, and subject to the limitations and
exceptions of, the Collateral and Guarantee Requirement and to otherwise comply
with the requirements of the Collateral and Guarantee Requirement;

(v) not later than 45 days after the acquisition by the Borrower or any
Guarantor of any other property or assets that are required to be provided as
Collateral pursuant to the Collateral and Guarantee Requirement (or such longer
period as the Collateral Agent may agree), which property would not be
automatically subject to another Lien pursuant to pre-existing Collateral
Documents, each such acquiring Borrower or Guarantor (i) to cause such property
to be subject to a Lien and security interest in favor of the Collateral Agent
and (ii) to take such actions as shall be necessary or reasonably requested by
the Collateral Agent to grant and perfect or record such Lien, in each case to
the extent required by, and subject to the limitations and exceptions of, the
Collateral and Guarantee Requirement and to otherwise comply with the
requirements of the Collateral and Guarantee Requirement; and

(vi) always ensuring that the Obligations are secured by a third-priority
security interest in all the Equity Interests of the Borrower, subject to any
Permitted Lien.

(c) The Borrower and the Guarantors shall execute any and all further documents,
financing statements, agreements and instruments, and take all further action
that may be required under applicable law, or that the Collateral Agent may
reasonably request, in order to grant, preserve, protect and perfect the
validity and priority of the security interests and Liens created or intended to
be created by the Collateral Documents in the Collateral. In addition, from time
to time, the Borrower will reasonably promptly secure the obligations under this
Agreement and the Collateral Documents by pledging or creating, or causing to be
pledged or created, perfected security interests and Liens with respect to the
Collateral. Such security interests and Liens will be created under the
Collateral Documents and other security agreements, mortgages, deeds of trust
and other instruments and documents as may be reasonably required.

 

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Section 20 Information Regarding Collateral.

(a) The Borrower shall furnish to the Collateral Agent, with respect to the
Borrower or any Guarantor, prompt written notice of any change in such Person’s
(i) legal name, (ii) jurisdiction of organization or formation, (iii) identity
or type of organization or corporate structure or (iv) chief executive officer.
The Borrower and the Guarantors will agree not to effect or permit any change
referred to in the preceding sentence unless all filings have been made under
the Uniform Commercial Code or otherwise that are required in order for the
Collateral Agent to continue at all times following such change to have a valid,
legal and perfected third-priority security interest (subject only to the liens
securing the First Lien Obligations, Permitted Second Lien Obligations and
certain other Permitted Liens) in all the Collateral

Section 21 Fundamental Changes. None of Holdings, the Borrower or any of the
Restricted Subsidiaries shall merge, dissolve, liquidate, consolidate with or
into another Person, or dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that:

(a) any Restricted Subsidiary may merge, amalgamate or consolidate with (i) the
Borrower (including a merger, the purpose of which is to reorganize the Borrower
into a new jurisdiction in the United States); provided that the Borrower shall
be the continuing or surviving Person or (ii) one or more other Restricted
Subsidiaries; provided that when any Person that is a Loan Party is merging with
a Restricted Subsidiary, a Loan Party shall be the continuing or surviving
Person;

(b) (i) any Subsidiary that is not a Loan Party may merge, amalgamate or
consolidate with or into any other Subsidiary that is not a Loan Party and
(ii) any Subsidiary may liquidate or dissolve or the Borrower or any Subsidiary
may change its legal form if the Borrower determines in good faith that such
action is in the best interest of the Borrower and its Subsidiaries and if not
materially disadvantageous to the Lenders (it being understood that in the case
of any change in legal form, a Subsidiary that is a Guarantor will remain a
Guarantor unless such Guarantor is otherwise permitted to cease being a
Guarantor hereunder);

(c) any Restricted Subsidiary may dispose of all or substantially all of its
assets (upon voluntary liquidation or otherwise) to Holdings or to another
Restricted Subsidiary; provided that if the transferor in such a transaction is
a Guarantor, then (i) the transferee must be a Guarantor or the Borrower or
(ii) to the extent constituting an Investment, such Investment must be a
permitted Investment in or Indebtedness of a Restricted Subsidiary which is not
a Loan Party in accordance with Sections 3 and 4, respectively;

(d) so long as no Default exists or would result therefrom, the Borrower may
merge with any other Person; provided that (i) the Borrower shall be the
continuing or surviving corporation or (ii) if the Person formed by or surviving
any such merger or consolidation is not the Borrower (any such Person, the
“Successor Company”), (A) the Successor Company shall

 

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be an entity organized or existing under the Laws of the United States, any
state thereof, the District of Columbia or any territory thereof, (B) the
Successor Company shall expressly assume all the obligations of the Borrower
under this Agreement and the other Loan Documents to which the Borrower is a
party pursuant to a supplement hereto or thereto in form reasonably satisfactory
to the Lender, (C) each Guarantor, unless it is the other party to such merger
or consolidation, shall have confirmed that its Guarantee shall apply to the
Successor Company’s obligations under the Loan Documents, (D) each Guarantor,
unless it is the other party to such merger or consolidation, shall have by a
supplement to the Security Agreement and other applicable Collateral Documents
confirmed that its obligations thereunder shall apply to the Successor Company’s
obligations under the Loan Documents, (E) if requested by the Lender, each
mortgagor of a mortgaged property, unless it is the other party to such merger
or consolidation, shall have by an amendment to or restatement of the applicable
mortgage (or other instrument reasonably satisfactory to the Lender) confirmed
that its obligations thereunder shall apply to the Successor Company’s
obligations under the Loan Documents, and (F) the Borrower shall have delivered
to the Lender a certificate of a Responsible Officer and an opinion of counsel,
each stating that such merger or consolidation and such supplement to this
Agreement or any Collateral Document comply with this Agreement; provided,
further, that if the foregoing are satisfied, the Successor Company will succeed
to, and be substituted for, the Borrower under this Agreement;

(e) so long as no Default exists or would result therefrom (in the case of a
merger involving a Loan Party), any Restricted Subsidiary may merge with any
other Person in order to effect an Investment permitted pursuant to Section 4;
provided that the continuing or surviving Person shall be a Restricted
Subsidiary or the Borrower, which together with each of its Restricted
Subsidiaries, shall have complied with the requirements of Section 19 to the
extent required pursuant to the Collateral and Guarantee Requirement;

(f) [reserved]; and

(g) so long as no Default exists or would result therefrom, a merger,
dissolution, liquidation, consolidation or disposition, the purpose of which is
to effect a Disposition permitted pursuant to Section 6.

Section 22 Use of Proceeds. The Borrower shall use the proceeds of the Loans in
the manner set forth in Section 4.11.

 

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