Exhibit 10.49

 

EXECUTION COPY

 

 

Published CUSIP Number:         

 

 

CREDIT AGREEMENT

 

Dated as of April 30, 2004

 

among

 

UNITED INDUSTRIES CORPORATION,

 

as the Borrower,

 

BANK OF AMERICA, N.A.,
as Administrative Agent, Swing Line Lender
and
L/C Issuer,

 

and

 

The Other Lenders Party Hereto

 

and

 

CITIGROUP GLOBAL MARKETS INC., as Documentation Agent

 

and

 

BANC OF AMERICA SECURITIES LLC

 

and

 

CITIGROUP GLOBAL MARKETS INC.,

 

as

 

Joint Lead Arrangers and Joint Book Managers

 

 

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TABLE OF CONTENTS

 

Section

 

 

 

 

 

 

 

 

 

ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS

 

 

 

 

 

 

 

1.01

 

Defined Terms

 

 

1.02

 

Other Interpretive Provisions

 

 

1.03

 

Accounting Terms

 

 

1.04

 

Rounding

 

 

1.05

 

References to Agreements and Laws

 

 

1.06

 

Times of Day

 

 

1.07

 

Currency Equivalents Generally

 

 

1.08

 

Timing of Performance

 

 

 

 

 

 

 

 

 

ARTICLE II

 

 

 

 

THE COMMITMENTS AND CREDIT EXTENSIONS

 

 

 

 

 

 

 

2.01

 

The Loans

 

 

2.02

 

Borrowings, Conversions and Continuations of Loans

 

 

2.03

 

Letters of Credit

 

 

2.04

 

Swing Line Loans

 

 

2.05

 

Prepayments

 

 

2.06

 

Termination or Reduction of Commitments

 

 

2.07

 

Repayment of Loans

 

 

2.08

 

Interest

 

 

2.09

 

Fees

 

 

2.10

 

Computation of Interest and Fees

 

 

2.11

 

Evidence of Indebtedness

 

 

2.12

 

Payments Generally

 

 

2.13

 

Sharing of Payments

 

 

2.14

 

Increase in Commitments

 

 

2.15

 

Use of Proceeds

 

 

 

 

 

 

 

 

 

ARTICLE III

 

 

 

 

TAXES, YIELD PROTECTION AND ILLEGALITY

 

 

 

 

 

 

 

3.01

 

Taxes

 

 

3.02

 

Illegality

 

 

3.03

 

Inability to Determine Rates

 

 

3.04

 

Increased Cost and Reduced Return; Capital Adequacy

 

 

3.05

 

Compensation for Losses

 

 

3.06

 

Matters Applicable to all Requests for Compensation

 

 

3.07

 

Replacement of Lenders under Certain Circumstances

 

 

3.08

 

Survival

 

 

 

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ARTICLE IV

 

 

 

 

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

 

 

 

 

 

 

4.01

 

Conditions of Initial Credit Extension

 

 

4.02

 

Conditions to all Credit Extensions

 

 

 

 

 

 

 

 

 

ARTICLE V

 

 

 

 

REPRESENTATIONS AND WARRANTIES

 

 

 

 

 

 

 

5.01

 

Existence, Qualification and Power

 

 

5.02

 

Capitalization

 

 

5.03

 

Authorization; No Contravention

 

 

5.04

 

Governmental Authorization; Other Consents

 

 

5.05

 

Enforceability

 

 

5.06

 

Financial Statements; No Material Adverse Effect

 

 

5.07

 

Projections

 

 

5.08

 

Accuracy of Information

 

 

5.09

 

Litigation

 

 

5.10

 

Collateral; Liens

 

 

5.11

 

Intellectual Property

 

 

5.12

 

Margin Stock

 

 

5.13

 

Investment Company Act, Etc

 

 

5.14

 

Solvency

 

 

5.15

 

Labor Matters

 

 

5.16

 

ERISA Matters

 

 

5.17

 

Environmental Compliance

 

 

5.18

 

Taxes

 

 

5.19

 

Real Estate

 

 

 

 

 

 

 

 

 

ARTICLE VI

 

 

 

 

AFFIRMATIVE, REPORTING AND FINANCIAL COVENANTS

 

 

 

 

 

 

 

6.01

 

Compliance with Laws, Maintenance of Governmental Authorizations, Etc

 

 

6.02

 

Payment of Taxes, Etc

 

 

6.03

 

Compliance with Environmental Laws

 

 

6.04

 

Maintenance of Insurance

 

 

6.05

 

Preservation of Corporate Existence, Etc

 

 

6.06

 

Visitation Rights

 

 

6.07

 

Keeping of Books

 

 

6.08

 

Maintenance of Properties, Etc

 

 

6.09

 

Compliance with Terms of Leaseholds

 

 

6.10

 

Transactions with Affiliates

 

 

6.11

 

Covenant to Give Security

 

 

6.12

 

Further Assurances

 

 

6.13

 

Reporting Requirements

 

 

6.14

 

Financial Covenants

 

 

6.15

 

Post-Closing Matters

 

 

 

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ARTICLE VII

 

 

 

 

NEGATIVE COVENANTS

 

 

 

 

 

 

 

7.01

 

Liens, Etc

 

 

7.02

 

Indebtedness

 

 

7.03

 

Mergers, Etc

 

 

7.04

 

Dispositions

 

 

7.05

 

Investments in Other Persons

 

 

7.06

 

Restricted Payments

 

 

7.07

 

Capital Expenditures

 

 

7.08

 

Prepayments, Etc. of Indebtedness

 

 

7.09

 

Negative Pledge

 

 

7.10

 

Dividends and Other Payment Restrictions Affecting Subsidiaries

 

 

7.11

 

Change in Nature of Business

 

 

7.12

 

Amendments to Constitutive Documents

 

 

7.13

 

Accounting Changes, Etc

 

 

7.14

 

Amendments, Etc. of Nu-Gro Documents

 

 

7.15

 

Holdings

 

 

 

 

 

 

 

 

 

ARTICLE VIII

 

 

 

 

EVENTS OF DEFAULT AND REMEDIES

 

 

 

 

 

 

 

8.01

 

Events of Default.

 

 

8.02

 

Actions in Respect of the Letters of Credit upon Default

 

 

8.03

 

Application of Funds

 

 

 

 

 

 

 

 

 

ARTICLE IX

 

 

 

 

ADMINISTRATIVE AGENT AND OTHER AGENTS

 

 

 

 

 

 

 

9.01

 

Appointment and Authorization of Agents

 

 

9.02

 

Delegation of Duties

 

 

9.03

 

Liability of Agents

 

 

9.04

 

Reliance by Agents

 

 

9.05

 

Notice of Default

 

 

9.06

 

Credit Decision; Disclosure of Information by Agents

 

 

9.07

 

Indemnification of Agents

 

 

9.08

 

Agents in their Individual Capacities

 

 

9.09

 

Successor Agents

 

 

9.10

 

Administrative Agent May File Proofs of Claim

 

 

9.11

 

Collateral and Guaranty Matters

 

 

9.12

 

Other Agents; Arrangers and Managers

 

 

 

 

 

 

 

 

 

ARTICLE X

 

 

 

 

MISCELLANEOUS

 

 

 

 

 

 

 

10.01

 

Amendments, Etc

 

 

10.02

 

Notices and Other Communications; Facsimile Copies

 

 

 

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10.03

 

No Waiver; Cumulative Remedies

 

 

10.04

 

Attorney Costs, Expenses and Taxes

 

 

10.05

 

Indemnification by the Borrower

 

 

10.06

 

Payments Set Aside

 

 

10.07

 

Successors and Assigns

 

 

10.08

 

Confidentiality

 

 

10.09

 

Setoff

 

 

10.10

 

Interest Rate Limitation

 

 

10.11

 

Counterparts

 

 

10.12

 

Integration

 

 

10.13

 

Survival of Representations and Warranties

 

 

10.14

 

Severability

 

 

10.15

 

Tax Forms

 

 

10.16

 

Governing Law

 

 

10.17

 

Waiver of Right to Trial by Jury

 

 

10.18

 

Binding Effect

 

 

10.19

 

USA PATRIOT Act Notice

 

 

10.20

 

Judgment Currency

 

 

 

 

 

 

 

SIGNATURES

 

 

 

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SCHEDULES

 

 

 

 

 

 

 

1.01(a)

 

Existing Letters of Credit

 

 

1.01(c)

 

Certain Adjustments to Financial Covenants

 

 

2.01

 

Commitments and Pro Rata Shares

 

 

5.02

 

Subsidiaries

 

 

5.17

 

Environmental Matters

 

 

5.18

 

Open Years

 

 

5.19

 

Owned and Leased Real Property

 

 

7.01

 

Existing Liens

 

 

7.02

 

Existing Indebtedness

 

 

7.04

 

Dispositions

 

 

7.05

 

Investments

 

 

10.02

 

Administrative Agent’s Office; Certain Addresses for Notices

 

 

 

 

 

 

 

EXHIBITS

 

 

 

 

Form of

 

 

 

 

 

 

 

 

 

A

 

Committed Loan Notice

 

 

B

 

Swing Line Loan Notice

 

 

C-1

 

Term Note

 

 

C-2

 

Revolving Credit Note

 

 

D

 

Compliance Certificate

 

 

E

 

Assignment and Assumption

 

 

F

 

Guaranty

 

 

G

 

Security Agreement

 

 

H

 

Mortgage

 

 

I

 

Intellectual Property Security Agreement

 

 

J-1

 

Opinion Matters – Counsel to Loan Parties

 

 

J-2

 

Opinion Matters – Local Counsel to Loan Parties in Ohio

 

 

K

 

Holdings Joinder Agreement and Guaranty

 

 

L

 

Subordination Provisions

 

 

 

v

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CREDIT AGREEMENT

 

This CREDIT AGREEMENT (“Agreement”) is entered into as of April 30, 2004, among
UNITED INDUSTRIES CORPORATION, a Delaware corporation (the “Borrower”), each
lender from time to time party hereto (collectively, the “Lenders” and
individually, a “Lender”), CITIGROUP GLOBAL MARKETS INC., as Documentation
Agent, and BANK OF AMERICA, N.A., as Administrative Agent, Swing Line Lender and
L/C Issuer.

 

PRELIMINARY STATEMENTS:

 

(1)           The Borrower has entered into an Amended and Restated Credit
Agreement dated as of March 24, 1999 (as supplemented or otherwise modified to
the date hereof, the “Existing Credit Agreement”) with certain banks, financial
institutions and other institutional lenders party thereto, and Bank of America,
as administrative agent for the lenders thereunder.

 

(2)           Pursuant to the Arrangement Agreement dated March 1, 2004 (as
amended, supplemented or otherwise modified to the date hereof, the “Arrangement
Agreement”) among the Borrower, Jupiter Acquisition Corporation, a corporation
existing under the Business Corporations Act (Ontario) and The Nu-Gro
Corporation, a corporation existing under the Business Corporations Act
(Ontario) (“Nu-Gro”), the Borrower has agreed to acquire (the “Nu-Gro
Acquisition”) all of the outstanding equity interests of Nu-Gro pursuant to a
plan of arrangement.

 

(3)           The Borrower has requested that the Lenders provide a revolving
credit facility and a term loan facility, in order to, among other things, (i)
refinance the commitments and outstanding amounts under the Existing Credit
Agreement, (ii) provide the Borrower with the funds necessary to consummate the
Nu-Gro Acquisition, (iii) redeem $56,000,000 of the Borrower’s preferred stock
(the “Preferred Stock Redemption”), (iv) pay fees and expenses incurred in
connection with each of the foregoing and (v) provide for the Borrower’s and its
Subsidiaries’ ongoing working capital needs and other general corporate
purposes.  The Lenders have indicated their willingness to lend and the L/C
Issuer has indicated its willingness to so issue Letters of Credit, in each
case, on the terms and subject to the conditions set forth herein.

 

In consideration of the mutual covenants and agreements herein contained, the
parties hereto covenant and agree as follows:

 

ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS

 

1.01         Defined Terms.  As used in this Agreement, the following terms
shall have the meanings set forth below:

 

“Acceptance” means a draft drawn by a beneficiary under a Letter of Credit,
which (a) provides for payment by the L/C Issuer on a date later than (but not
more than 180 days later than) the date on which such beneficiary presents the
documents called for under such Letter of Credit and (b) has been stamped
“accepted” by the L/C Issuer.

 

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“Actual Rate” has the meaning specified in Section 3.01(e).

 

“Administrative Agent” means Bank of America in its capacity as administrative
agent under any of the Loan Documents, or any successor administrative agent.

 

“Administrative Agent’s Office” means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 10.02, or such other address or
account as the Administrative Agent may from time to time notify the Borrower
and the Lenders.

 

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

 

“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.  Notwithstanding the foregoing,
neither any Agent nor any Lender shall be deemed to be an Affiliate of any Loan
Party or any Subsidiary or Affiliate of any Loan Party.

 

“Agent-Related Persons” means the Administrative Agent, each Arranger, and the
Documentation Agent, together with their respective Affiliates (including, in
the case of Bank of America in its capacity as the Administrative Agent, BAS),
and the officers, directors, employees, agents and attorneys-in-fact of such
Persons and Affiliates.

 

“Agents” means, collectively, the Administrative Agent, the Documentation Agent
and each co-agent or sub-agent appointed by the Administrative Agent from time
to time pursuant to Section 9.02.

 

“Agreement Currency” has the meanings specified in Section 10.20.

 

“Aggregate Commitments” means the Commitments of all the Lenders.

 

“Aggregate Credit Exposures” means, at any time, the sum of (i) the unused
portion of the Revolving Credit Commitment then in effect, (ii) the unused
portion of each Term Commitment then in effect and (iii) the Total Outstandings
at such time.

 

“Agreement” means this Credit Agreement.

 

“Agreement Value” means, with respect to each Swap Contract on any date of
determination, an amount equal to the greater of:

 

(A)           (I) IN THE CASE OF ANY SWAP CONTRACT DOCUMENTED PURSUANT TO AN
ISDA MASTER AGREEMENT, THE AMOUNT, IF ANY, THAT WOULD BE PAYABLE BY ANY OF THE
LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES TO ITS COUNTERPARTY TO SUCH SWAP
CONTRACT, AS IF (A) SUCH SWAP CONTRACT WAS BEING TERMINATED EARLY ON SUCH DATE
OF DETERMINATION, (B) SUCH LOAN PARTY OR SUCH SUBSIDIARY, AS THE CASE MAY BE,
WAS THE SOLE AFFECTED PARTY (AS DEFINED IN

 

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THE APPLICABLE ISDA MASTER AGREEMENT) AND (C) THE ADMINISTRATIVE AGENT WAS THE
SOLE PARTY DETERMINING SUCH PAYMENT AMOUNT (WITH THE ADMINISTRATIVE AGENT MAKING
SUCH DETERMINATION PURSUANT TO THE PROVISIONS OF THE FORM OF ISDA MASTER
AGREEMENT); OR (II) IN THE CASE OF A SWAP CONTRACT TRADED ON AN EXCHANGE, THE
MARK-TO-MARKET VALUE OF SUCH SWAP CONTRACT, WHICH WILL BE THE UNREALIZED LOSS ON
SUCH SWAP CONTRACT TO THE LOAN PARTY OR THE SUBSIDIARY OF A LOAN PARTY TO SUCH
SWAP CONTRACT (DETERMINED BY THE ADMINISTRATIVE AGENT BASED ON THE SETTLEMENT
PRICE OF SUCH SWAP CONTRACT ON SUCH DATE); OR

 

(B)           IN ALL OTHER CASES, THE MARK-TO-MARKET VALUE OF SUCH SWAP
CONTRACT, WHICH WILL BE THE UNREALIZED LOSS ON SUCH SWAP CONTRACT TO THE LOAN
PARTY OR THE SUBSIDIARY OF A LOAN PARTY PARTY TO SUCH SWAP CONTRACT (DETERMINED
BY THE ADMINISTRATIVE AGENT BASED ON THE AMOUNT, IF ANY, BY WHICH (I) THE
PRESENT VALUE OF THE FUTURE CASH FLOWS TO BE PAID BY SUCH LOAN PARTY OR SUCH
SUBSIDIARY OF A LOAN PARTY, AS THE CASE MAY BE, EXCEEDS (II) THE PRESENT VALUE
OF THE FUTURE CASH FLOWS TO BE RECEIVED BY SUCH LOAN PARTY OR SUCH SUBSIDIARY OF
A LOAN PARTY PURSUANT TO SUCH SWAP CONTRACT).

 

“Alternate Date” means December 31, 2008 if the Senior Subordinated Notes have
not by November 30, 2008 been refinanced with replacement senior subordinated
notes having a maturity date of no sooner than the date which is 7½ years after
the Closing Date, and otherwise in compliance with Section 7.02(b)(x).

 

“Applicable Rate” means (a) with respect to Term Loans, (i) 2.50% in the case of
Eurodollar Rate Loans and Screen Rate Loans and (ii) 1.50% in the case of Base
Rate Loans and (b) with respect to Revolving Credit Loans, (i) for the period
from the Closing Date through the date which is six months after the Closing
Date, (A) with respect to Eurodollar Rate Loans, 2.50% and (B) with respect to
Base Rate Loans, 1.50% and (ii) from and after the date which is six months
after the Closing Date, the following percentages per annum, based upon the
Total Leverage Ratio as set forth in the most recent Compliance Certificate
received by the Administrative Agent pursuant to Section 6.13(d):

 

Pricing Level

 

Total Leverage
Ratio

 

Eurodollar
Rate +
 Letters of
Credit

 

Base Rate +

 

1

 

<3.25:1

 

1.75

 

0.75

 

2

 

>3.25:1 but <3.75:1

 

2.00

 

1.00

 

3

 

>3.75:1 but <4.25:1

 

2.25

 

1.25

 

4

 

>4.25:1

 

2.50

 

1.50

 

 

Any increase or decrease in the Applicable Rate resulting from a change in the
Total Leverage Ratio shall become effective as of the first Business Day
immediately following the date a Compliance Certificate is delivered pursuant to
Section 6.13(d); provided, however, that if a Compliance Certificate is not
delivered when due in accordance with such Section, then Pricing Level 4 shall
apply as of the first Business Day after the date on which such Compliance
Certificate was required to have been delivered until the first Business Day
immediately following the date on which such Compliance Certificate is
delivered.

 

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“Appropriate Lender” means, at any time, (a) with respect to the Term Facility
or the Revolving Credit Facility, a Lender that has a Commitment with respect to
such Facility at such time, (b) with respect to the Letter of Credit Sublimit,
(i) the L/C Issuer and (ii) if any Letters of Credit have been issued pursuant
to Section 2.03(a), the Revolving Credit Lenders and (c) with respect to the
Swing Line Facility, (i) the Swing Line Lender and (ii) if any Swing Line Loans
are outstanding pursuant to Section 2.04(a), the Revolving Credit Lenders.

 

“Approved Fund” has the meaning specified in Section 10.07(g).

 

“Arrangement Agreement” has the meaning specified in the preliminary statements
to this Agreement.

 

“Arrangers” means BAS and CGMI, in their capacities as joint lead arrangers and
joint book managers.

 

“Assignment and Assumption” means an Assignment and Assumption substantially in
the form of Exhibit E.

 

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

 

“Audited Financial Statements” means the audited consolidated balance sheet of
Borrower and its Subsidiaries for the fiscal year ended December 31, 2003, and
the related consolidated statements of income or operations, shareholders’
equity and cash flows for such fiscal year of the Borrower and its Subsidiaries,
including the notes thereto.

 

“Auto-Extension Letter of Credit” has the meaning specified in Section
2.03(b)(iii).

 

“Availability Period” means the period from and including the Closing Date to
(a) in the case of the Revolving Credit Facility, the earliest of (i) the
Maturity Date for such Facility, (ii) the date of termination of the Revolving
Credit Commitments pursuant to Section 2.06, and (iii) the date of termination
of the commitment of each Revolving Credit Lender to make Revolving Credit Loans
and of the obligation of the L/C Issuer to make L/C Credit Extensions pursuant
to Section 8.01, and (b) in the case of the Term Facility, the earliest of (i)
the Maturity Date for such Facility, (ii) the date of termination of the Term
Commitments pursuant to Section 2.06, and (iii) the date of termination of the
commitment of each Term Lender to make Term Loans pursuant to Section 8.01.

 

“Backstop L/C” has the meaning specified in Section 2.03(g).

 

“Bank of America” means Bank of America, N.A. and its successors.

 

“BAS” means Banc of America Securities LLC and its successors.

 

“Base Rate” means, for any day, with respect to any Loan other than a Canadian
Term Loan, a fluctuating rate per annum equal to the higher of (a) the Federal
Funds Rate plus 1/2 of 1% and (b) the rate of interest in effect for such day as
publicly announced from time to

 

4

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time by Bank of America as its “prime rate.”  The “prime rate” is a rate set by
Bank of America based upon various factors including Bank of America’s costs and
desired return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such announced rate.  Any change in such rate announced by Bank of America shall
take effect at the opening of business on the day specified in the public
announcement of such change.

 

“Base Rate Loan” means a Loan that bears interest based on the Base Rate.

 

“Borrower” has the meaning specified in the introductory paragraph hereto.

 

“Borrowing” means a Revolving Credit Borrowing, a Swing Line Borrowing, a
Canadian Term Borrowing or a Dollar Term Borrowing, as the context may require.

 

“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where the Administrative Agent’s Office is located and, if
such day relates to any (a) Eurodollar Rate Loan, means any such day on which
dealings in Dollar deposits are conducted by and between banks in the London
interbank eurodollar market and (b) Screen Rate Loan, means any day on which
dealings in deposits in Canadian Dollars are conducted by and between banks in
the London interbank market for Canadian Dollars.

 

“Canadian Dollar” and“CD” mean lawful money of Canada.

 

“Canadian GAAP “ means generally accepted accounting principles in effect from
time to time in Canada and applied on a consistent basis, subject, however, to
the terms of Section 1.03.

 

“Canadian Loan” means the loan to be made in Canadian Dollars by a
Canadian-based lending office of Bank of America to a successor of Nu-Gro on the
Closing Date and repaid within one Business Day with the proceeds received by
such borrower from the purchase of certain of Nu-Gro’s Subsidiaries.

 

“Canadian Term Borrowing” means a borrowing consisting of simultaneous Canadian
Term Loans of the same Type and, in the case of Screen Rate Loans, having the
same Interest Period, made by the Canadian Term Lenders pursuant to Section
2.01(a).

 

“Canadian Term Commitment “ means, as to each Canadian Term Lender, its
obligation to make a Canadian Term Loan to the Borrower pursuant to Section
2.01(a) in a principal amount not to exceed the amount set forth opposite such
Lender’s name on Schedule 2.01 under the caption “Canadian Term Commitment” or
in the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.

 

“Canadian Term Facility” means, at any time, the aggregate Canadian Term
Commitments or Canadian Term Loans, as applicable, of all Canadian Term Lenders
at such time.

 

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“Canadian Term Lender” means each of the Term Lenders with a Canadian  Term
Commitment, as set forth on Schedule 2.01 hereto.

 

“Canadian Term Loan” has the meaning specified in Section 2.01(a).

 

“Capital Expenditures” means, with respect to any Person for any period, all
expenditures made by such Person during such period for capital assets in
accordance with GAAP; provided however, that Capital Expenditures shall not
include (a) any expenditures by the Borrower or any of its Subsidiaries in
connection with a Permitted Acquisition or capital assets acquired in connection
with a Permitted Acquisition or (b) any expenditures made with the proceeds of
condemnation or eminent domain proceedings affecting real property or with
insurance proceeds; provided, further that any expenditure that is purchased
with the trade-in or exchange of existing assets or the cash proceeds of the
sale or other disposition of existing assets permitted pursuant to
Section 7.04(d) or with insurance proceeds shall be included in Capital
Expenditures only to the extent of the gross amount by which such purchase price
exceeds the credit granted by the seller of such assets for the assets being
traded in, the amount of the cash proceeds of any such sale or disposition or
the amount of such insurance proceeds, as the case may be.

 

“Capitalized Lease” means any lease with respect to which the lessee is required
to recognize concurrently the acquisition of property or an asset and the
incurrence of a liability in accordance with GAAP.

 

“Cash Collateral Account” means a blocked, non-interest bearing deposit account
at Bank of America in the name of the Collateral Agent and under the sole
dominion and control of the Collateral Agent, and otherwise established in a
manner satisfactory to the Administrative Agent.

 

“Cash Collateralize” has the meaning specified in Section 2.03(g).

 

“Cash Equivalents” means any of the following types of Investments, to the
extent owned by the Borrower or any of its Subsidiaries free and clear of all
Liens (other than Liens created under the Collateral Documents):

 

(A)           READILY MARKETABLE OBLIGATIONS ISSUED OR DIRECTLY AND FULLY
GUARANTEED OR INSURED BY THE UNITED STATES OF AMERICA OR ANY AGENCY OR
INSTRUMENTALITY THEREOF HAVING MATURITIES OF NOT MORE THAN 360 DAYS FROM THE
DATE OF ACQUISITION THEREOF; PROVIDED THAT THE FULL FAITH AND CREDIT OF THE
UNITED STATES OF AMERICA IS PLEDGED IN SUPPORT THEREOF;

 

(B)           TIME DEPOSITS WITH, OR INSURED CERTIFICATES OF DEPOSIT OR BANKERS’
ACCEPTANCES OF, ANY COMMERCIAL BANK THAT (I) (A) IS A LENDER OR (B) IS ORGANIZED
UNDER THE LAWS OF THE UNITED STATES OF AMERICA, ANY STATE THEREOF OR THE
DISTRICT OF COLUMBIA, OR IS THE PRINCIPAL BANKING SUBSIDIARY OF A BANK HOLDING
COMPANY ORGANIZED UNDER THE LAWS OF THE UNITED STATES OF AMERICA, ANY STATE
THEREOF OR THE DISTRICT OF COLUMBIA, AND IS A MEMBER OF THE FEDERAL RESERVE
SYSTEM, (II) ISSUES (OR THE PARENT OF WHICH ISSUES) COMMERCIAL PAPER RATED AS
DESCRIBED BELOW IN CLAUSE (C) OF THIS DEFINITION AND (III) HAS COMBINED CAPITAL
AND SURPLUS OF AT LEAST $500,000,000, IN EACH CASE WITH A MATURITY OF NOT MORE
THAN ONE YEAR FROM THE DATE OF ACQUISITION THEREOF;

 

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(C)           COMMERCIAL PAPER ISSUED BY ANY PERSON ORGANIZED UNDER THE LAWS OF
ANY STATE OF THE UNITED STATES OF AMERICA AND RATED AT LEAST “PRIME-1” (OR THE
THEN EQUIVALENT GRADE) BY MOODY’S INVESTORS SERVICE, INC. OR AT LEAST “A-1” (OR
THE THEN EQUIVALENT GRADE) BY STANDARD & POOR’S RATINGS GROUP, IN EACH CASE WITH
A MATURITY OF NOT MORE THAN 180 DAYS FROM THE DATE OF ACQUISITION THEREOF;

 

(D)           SOLELY WITH RESPECT TO ANY FOREIGN SUBSIDIARY, NON-DOLLAR
DENOMINATED (I) CERTIFICATES OF DEPOSIT OF, BANKERS ACCEPTANCES OF, OR TIME
DEPOSITS WITH ANY COMMERCIAL BANK WHICH IS ORGANIZED AND EXISTING UNDER THE LAWS
OF THE COUNTRY IN WHICH SUCH FOREIGN SUBSIDIARY MAINTAINS ITS CHIEF EXECUTIVE
OFFICE AND PRINCIPAL PLACE OF BUSINESS PROVIDED SUCH COUNTRY IS A MEMBER OF THE
ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT, AND WHOSE SHORT-TERM
COMMERCIAL PAPER RATING IS AT LEAST “PRIME-1” (OR THE THEN EQUIVALENT GRADE) BY
MOODY’S INVESTORS SERVICE, INC. OR AT LEAST “A-1” (OR THE THEN EQUIVALENT
GRADE) BY STANDARD & POOR’S RATINGS GROUP (ANY SUCH BANK BEING AN “APPROVED
FOREIGN BANK”) AND MATURING WITHIN TWELVE (12) MONTHS OF THE DATE OF ACQUISITION
AND (II) EQUIVALENTS OF DEMAND DEPOSIT ACCOUNTS WHICH ARE MAINTAINED WITH AN
APPROVED FOREIGN BANK;

 

(E)           REPURCHASE AGREEMENTS ENTERED INTO BY ANY PERSON WITH A BANK OR
TRUST COMPANY (INCLUDING ANY OF THE LENDERS) OR RECOGNIZED SECURITIES DEALER
HAVING CAPITAL AND SURPLUS IN EXCESS OF $500,000,000 FOR DIRECT OBLIGATIONS
ISSUED BY OR FULLY GUARANTEED BY THE UNITED STATES IN WHICH SUCH PERSON SHALL
HAVE A PERFECTED FIRST PRIORITY SECURITY INTEREST (SUBJECT TO NO OTHER LIENS)
AND HAVING, ON THE DATE OF PURCHASE THEREOF, A FAIR MARKET VALUE OF AT LEAST
100% OF THE AMOUNT OF THE REPURCHASE OBLIGATIONS;

 

(F)            SECURITIES WITH MATURITIES OF ONE YEAR OR LESS FROM THE DATE OF
ACQUISITION ISSUED OR FULLY GUARANTEED BY ANY STATE, COMMONWEALTH OR TERRITORY
OF THE UNITED STATES, BY ANY POLITICAL SUBDIVISION OR TAXING AUTHORITY OF ANY
SUCH STATE, COMMONWEALTH OR TERRITORY OR BY ANY FOREIGN GOVERNMENT, THE
SECURITIES OR WHICH STATE, COMMONWEALTH, TERRITORY, POLITICAL SUBDIVISION,
TAXING AUTHORITY OR FOREIGN GOVERNMENT (AS THE CASE MAY BE) ARE RATED AT LEAST
“A” (OR THE THEN EQUIVALENT GRADE) BY MOODY’S INVESTORS SERVICE, INC. OR AT
LEAST “A” (OR THE THEN EQUIVALENT GRADE) BY STANDARD & POOR’S RATINGS GROUP; AND

 

(G)           INVESTMENTS, CLASSIFIED AS CURRENT ASSETS OF THE BORROWER OR ANY
OF ITS SUBSIDIARIES, IN MONEY MARKET INVESTMENT PROGRAMS REGISTERED UNDER THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED, WHICH ARE ADMINISTERED BY FINANCIAL
INSTITUTIONS THAT HAVE CAPITAL OF AT LEAST $500,000,000 AND THE PORTFOLIOS OF
WHICH ARE LIMITED SUCH THAT 95% OF SUCH INVESTMENTS ARE OF THE CHARACTER AND
QUALITY DESCRIBED IN CLAUSES (A), (B), (C), (D), (E) AND (F) OF THIS DEFINITION,
IN EACH CASE WITH A MATURITY OF NOT MORE THAN ONE YEAR FROM THE DATE OF SUCH
INVESTMENT.

 

“CERCLA” means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980.

 

“CERCLIS” means the Comprehensive Environmental Response, Compensation and
Liability Information System maintained by the U.S. Environmental Protection
Agency.

 

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“CFC” means a “controlled foreign corporation” under Section 957 of the Code.

 

“CGMI” means Citigroup Global Markets Inc.

 

“Change of Control” means the earliest to occur of:

 

(A)           AT ANY TIME PRIOR TO THE CONSUMMATION OF A QUALIFYING IPO, AND
PRIOR TO THE HOLDING COMPANY EVENT, AND FOR ANY REASON WHATSOEVER, (A) THE
EQUITY INVESTORS DO NOT HAVE THE RIGHT TO DESIGNATE (OR DO NOT SO DESIGNATE) A
MAJORITY OF THE BOARD OF DIRECTORS OF THE BORROWER OR (B)(1) THE EQUITY
INVESTORS DO NOT OWN OF RECORD OR BENEFICIALLY, DIRECTLY OR INDIRECTLY, AN
AMOUNT OF COMMON STOCK OF THE BORROWER EQUAL TO AN AMOUNT MORE THAN FIFTY
PERCENT (50%) OF THE AMOUNT OF COMMON STOCK OF THE BORROWER OWNED BY THE EQUITY
INVESTORS OF RECORD OR BENEFICIALLY, DIRECTLY OR INDIRECTLY, AS OF THE CLOSING
DATE OR (2) THE EQUITY INVESTORS DO OWN THE PERCENTAGE OF COMMON STOCK REQUIRED
BY THE FOREGOING SUBCLAUSE (1), BUT SUCH OWNERSHIP BY THE EQUITY INVESTORS DOES
NOT REPRESENT THE LARGEST SINGLE BLOCK OF VOTING SECURITIES OF THE BORROWER HELD
BY ANY PERSON OR RELATED GROUP FOR PURPOSES OF SECTION 13(D) OF THE SECURITIES
AND EXCHANGE ACT OF 1934, AS AMENDED, OR

 

(B)           AT ANY TIME PRIOR TO THE CONSUMMATION OF A QUALIFYING IPO, AND
AFTER THE OCCURRENCE OF THE HOLDING COMPANY EVENT, AND FOR ANY REASON
WHATSOEVER, (A) THE EQUITY INVESTORS DO NOT HAVE THE RIGHT TO DESIGNATE (OR DO
NOT SO DESIGNATE) A MAJORITY OF THE BOARD OF DIRECTORS OF HOLDINGS OR (B)(1) THE
EQUITY INVESTORS DO NOT OWN OF RECORD OR BENEFICIALLY, DIRECTLY OR INDIRECTLY,
AN AMOUNT OF COMMON STOCK OF HOLDINGS EQUAL TO AN AMOUNT MORE THAN FIFTY PERCENT
(50%) OF THE AMOUNT OF COMMON STOCK OF HOLDINGS OWNED BY THE EQUITY INVESTORS OF
RECORD OR BENEFICIALLY, DIRECTLY OR INDIRECTLY, AS OF THE DATE OF THE HOLDING
COMPANY EVENT OR (2) THE EQUITY INVESTORS DO OWN THE PERCENTAGE OF COMMON STOCK
REQUIRED BY THE FOREGOING SUBCLAUSE (1), BUT SUCH OWNERSHIP BY THE EQUITY
INVESTORS DOES NOT REPRESENT THE LARGEST SINGLE BLOCK OF VOTING SECURITIES OF
HOLDINGS HELD BY ANY PERSON OR RELATED GROUP FOR PURPOSES OF SECTION 13(D) OF
THE SECURITIES AND EXCHANGE ACT OF 1934, AS AMENDED OR (C) THE BORROWER SHALL
CEASE TO BE A WHOLLY OWNED SUBSIDIARY OF HOLDINGS; OR

 

(C)           AT ANY TIME AFTER THE CONSUMMATION OF A QUALIFYING IPO, AND FOR
ANY REASON WHATSOEVER, (A) ANY “PERSON” OR “GROUP” (AS SUCH TERMS ARE USED IN
SECTIONS 13(D) AND 14(D) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, BUT
EXCLUDING ANY EMPLOYEE BENEFIT PLAN OF SUCH PERSON AND ITS SUBSIDIARIES, AND ANY
PERSON OR ENTITY ACTING IN ITS CAPACITY AS TRUSTEE, AGENT OR OTHER FIDUCIARY OR
ADMINISTRATOR OF ANY SUCH PLAN), EXCLUDING THE EQUITY INVESTORS, SHALL BECOME
THE “BENEFICIAL OWNER” (AS DEFINED IN RULES 13(D)-3 AND 13(D)-5 UNDER SUCH ACT),
DIRECTLY OR INDIRECTLY, OF MORE THAN THE GREATER OF (X) THIRTY-FIVE PERCENT
(35%) OF THE SHARES OUTSTANDING OR (Y) THE PERCENTAGE OF THE THEN OUTSTANDING
VOTING STOCK OF, IN EACH CASE, THE BORROWER (OR AFTER THE HOLDING COMPANY EVENT,
HOLDINGS), OWNED BENEFICIALLY BY THE EQUITY INVESTORS OR (B) DURING ANY PERIOD
OF TWELVE (12) CONSECUTIVE MONTHS, THE BOARD OF DIRECTORS OF THE BORROWER (OR
AFTER THE HOLDING COMPANY EVENT, HOLDINGS) SHALL NOT CONSIST OF A MAJORITY OF
THE CONTINUING DIRECTORS; OR

 

8

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(D)           A “CHANGE OF CONTROL” OR ANY COMPARABLE TERM UNDER, AND AS DEFINED
IN, THE SENIOR SUBORDINATED NOTES DOCUMENTS OR OTHER INDEBTEDNESS OF HOLDINGS,
THE BORROWER OR ANY OF THE BORROWER’S SUBSIDIARIES WITH AMOUNTS OUTSTANDING IN
AN AGGREGATE PRINCIPAL AMOUNT OF AT LEAST $15,000,000 SHALL HAVE OCCURRED.

 

“Citigroup” means Citigroup Global Markets, Inc. and its successors.

 

“Closing Date” means the first date all the conditions precedent in Section 4.01
are satisfied or waived in accordance with Section 10.01.

 

“Code” means the U.S. Internal Revenue Code of 1986.

 

“Collateral” means all of the “Collateral” and “Mortgaged Property” referred to
in the Collateral Documents and all of the other property and assets that are or
are intended under the terms of the Collateral Documents to be subject to Liens
in favor of the Administrative Agent for the benefit of the Secured Parties.

 

“Collateral Agent” has the meaning specified in Section 9.01(c).

 

“Collateral Documents” means, collectively, the Security Agreement, the
Intellectual Property Security Agreement, the Mortgages, each of the mortgages,
collateral assignments, Security Agreement Supplements, IP Security Agreement
Supplements, security agreements, pledge agreements or other similar agreements
delivered to the Administrative Agent and the Lenders pursuant to Section 6.11
and 6.15, and each of the other agreements, instruments or documents that
creates or purports to create a Lien in favor of the Administrative Agent for
the benefit of the Secured Parties.

 

“Commitment” means a Term Commitment or a Revolving Credit Commitment, as the
context may require.

 

“Committed Loan Notice” means a notice of (a) a Term Loan Borrowing, (b) a
Revolving Credit Borrowing, (c) a conversion of Loans from one Type to the
other, or (d) a continuation of Eurodollar Rate Loans, pursuant to Section
2.02(a), which, if in writing, shall be substantially in the form of Exhibit A.

 

“Compensation Period” has the meaning specified in Section 2.12(c)(ii).

 

“Compliance Certificate” has the meaning specified in Section 6.13(d).

 

“Consolidated” refers to the consolidation of accounts in accordance with GAAP.

 

“Consolidated Cash Interest Expense” means, with respect to any Person for any
period, the interest expense paid or payable in cash on all Indebtedness of such
Person and its Subsidiaries (net of all interest income of such Person and its
Subsidiaries) for such period, determined on a Consolidated basis and in
accordance with GAAP, including, without limitation, (a) in the case of the
Borrower all fees paid or payable pursuant to Section 2.09(a), (b) the interest
component of all obligations in respect of Capitalized Leases, (c) commissions,
discounts and other fees and charges paid or payable in connection with letters
of credit (including, without

 

9

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limitation, the Letters of Credit) and (d) the net payment, if any, paid or
payable in connection with Swap Contracts pertaining to interest payable in
respect of Indebtedness for borrowed money less the net credit, if any, received
in connection with Swap Contracts, but excluding (A) any amortization of
original issue discount, (B) the interest portion of any deferred payment
obligation, (C) any other interest not payable in cash during such period,
(D) fees and expenses associated with any Investment permitted under Section
7.05, issuance of Equity Interests or issuance or incurrence of Indebtedness
permitted under Section 7.02 (whether or not consummated), as determined in
accordance with GAAP, to the extent the same are payable in cash with respect to
such period, (E) fees and expenses associated with the consummation of the
Nu-Gro Transaction, (F) annual agency fees paid to the Administrative Agent and
(G) costs associated with obtaining Swap Contracts.

 

“Consolidated EBITDA” means, with respect to any Person for any period,

 

(A)           THE CONSOLIDATED NET INCOME OF SUCH PERSON AND ITS SUBSIDIARIES
FOR SUCH PERIOD (EXCLUDING, IN EACH CASE, EXTRAORDINARY GAINS AND EXTRAORDINARY
LOSSES) PLUS

 

(B)           THE SUM OF EACH OF THE FOLLOWING EXPENSES THAT HAVE BEEN DEDUCTED
FROM THE DETERMINATION OF THE CONSOLIDATED NET INCOME OF SUCH PERSON AND ITS
SUBSIDIARIES FOR SUCH PERIOD:

 

(I)            ALL INTEREST EXPENSE OF SUCH PERSON AND ITS SUBSIDIARIES (NET OF
(A) ALL INTEREST INCOME OF SUCH PERSON AND ITS SUBSIDIARIES FOR SUCH PERIOD AND
(B) SOLELY TO THE EXTENT OTHERWISE EXCLUDED FROM THE DETERMINATION OF THE
CONSOLIDATED INTEREST EXPENSE OF SUCH PERSON AND ITS SUBSIDIARIES FOR SUCH
PERIOD IN ACCORDANCE WITH GAAP, ANY UNREALIZED GAINS OR LOSSES ON ANY SWAP
CONTRACTS PERTAINING TO INTEREST PAYABLE IN RESPECT OF INDEBTEDNESS FOR BORROWED
MONEY OF SUCH PERSON AND ITS SUBSIDIARIES RESULTING FROM THE MARK-TO-MARKET
VALUE THEREOF AS OF THE LAST DAY OF SUCH PERIOD),

 

(II)           ALL INCOME, FRANCHISE OR SIMILAR TAX EXPENSE (WHETHER FEDERAL,
STATE, LOCAL, FOREIGN OR OTHERWISE) OF SUCH PERSON AND ITS SUBSIDIARIES FOR SUCH
PERIOD,

 

(III)          ALL DEPRECIATION EXPENSE OF SUCH PERSON AND ITS SUBSIDIARIES FOR
SUCH PERIOD,

 

(IV)          ALL AMORTIZATION EXPENSE OF SUCH PERSON AND ITS SUBSIDIARIES FOR
SUCH PERIOD,

 

(V)           (A) ALL NONCASH LOSSES AND NONCASH CHARGES OTHERWISE DEDUCTED FROM
THE DETERMINATION OF THE CONSOLIDATED NET INCOME OF SUCH PERSON AND ITS
SUBSIDIARIES FOR SUCH PERIOD (OTHER THAN ANY SUCH NONCASH LOSSES OR NONCASH
CHARGES THAT REQUIRE AN ACCRUAL OR RESERVE FOR CASH CHARGES OR CASH EXPENSES
PAID OR PAYABLE (OR TO BE PAID OR PAYABLE) AT ANY TIME DURING SUCH PERIOD AND
ANY WRITE-DOWNS OR WRITE-OFFS OF ACCOUNTS RECEIVABLES) LESS (B) ALL NONCASH
GAINS AND NONCASH CREDITS OTHERWISE ADDED IN THE DETERMINATION OF THE
CONSOLIDATED NET INCOME OF SUCH PERSON AND ITS SUBSIDIARIES FOR SUCH PERIOD, IN
EACH CASE

 

10

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DETERMINED ON A CONSOLIDATED BASIS AND IN ACCORDANCE WITH GAAP FOR SUCH PERIOD,

 

(VI)          CASH EXPENSES OR CHARGES INCURRED IN CONNECTION WITH OR IN
CONTEMPLATION OF THE NU-GRO TRANSACTION OR, TO THE EXTENT PERMITTED HEREUNDER,
ANY INVESTMENT PERMITTED UNDER SECTION 7.05, ISSUANCE OF EQUITY INTERESTS OR
ISSUANCE OR INCURRENCE OF INDEBTEDNESS PERMITTED UNDER SECTION 7.02 (IN EACH
CASE, WHETHER OR NOT CONSUMMATED),

 

(VII)         ANY LOSSES (OR MINUS ANY GAINS) REALIZED UPON THE DISPOSITION OF
PROPERTY OUTSIDE OF THE ORDINARY COURSE OF BUSINESS,

 

(VIII)        TO THE EXTENT ACTUALLY REIMBURSED, EXPENSES INCURRED TO THE EXTENT
COVERED BY INDEMNIFICATION PROVISIONS IN ANY AGREEMENT IN CONNECTION WITH A
PERMITTED ACQUISITION,

 

(IX)           TO THE EXTENT COVERED BY INSURANCE, EXPENSES WITH RESPECT TO
LIABILITY OR CASUALTY EVENTS, BUSINESS INTERRUPTION OR PRODUCT RECALLS,

 

(X)            MANAGEMENT FEES PERMITTED UNDER SECTION 6.10,

 

(XI)           FEES AND EXPENSES (INCLUDING ANY APPLICABLE PREMIUM) IN
CONNECTION WITH THE EXCHANGE OF THE SENIOR SUBORDINATED NOTES FOR REGISTERED
NOTES WITH IDENTICAL TERMS AS CONTEMPLATED BY THE SENIOR SUBORDINATED NOTES
DOCUMENTS OR EXCHANGES, REDEMPTIONS OR REFINANCINGS PERMITTED BY THIS AGREEMENT,

 

(XII)          WITH RESPECT TO ANY PERMITTED EQUITY ISSUANCE TO THE EQUITY
INVESTORS MADE TO CURE A PROSPECTIVE EVENT OF DEFAULT IN RESPECT OF ANY COVENANT
SET FORTH IN SECTION 6.14, THE NET CASH PROCEEDS OF SUCH PERMITTED EQUITY
ISSUANCE SOLELY TO THE EXTENT THAT SUCH NET CASH PROCEEDS (A) ARE ACTUALLY
RECEIVED BY THE BORROWER (INCLUDING THROUGH CAPITAL CONTRIBUTION OF SUCH NET
CASH PROCEEDS BY THE EQUITY INVESTORS TO THE BORROWER) NO LATER THAN FIFTEEN
BUSINESS DAYS AFTER THE DELIVERY OF A NOTICE OF INTENT TO CURE, (B) HAVE NOT
BEEN APPLIED TO MAKE ANY PAYMENT OF THE TYPE DESCRIBED IN SECTION 7.06 OR ANY
INVESTMENT OR ANY PREPAYMENT OF INDEBTEDNESS (OTHER THAN A PREPAYMENT OF THE
LOANS) AND (C) DO NOT EXCEED THE AGGREGATE AMOUNT NECESSARY TO CURE SUCH EVENT
OF DEFAULT UNDER SECTION 6.14 FOR ANY APPLICABLE PERIOD, PROVIDED THAT THE
PROVISIONS OF THIS SUBCLAUSE (B)(XII) MAY BE RELIED ON FOR PURPOSES OF
DETERMINING CONSOLIDATED EBITDA NO MORE THAN TWO TIMES IN ANY TWELVE-MONTH
PERIOD, IT BEING UNDERSTOOD THAT THIS SUBCLAUSE (B)(XII) MAY NOT BE RELIED ON
FOR PURPOSES OF CALCULATING ANY FINANCIAL RATIOS OTHER THAN AS APPLICABLE TO
SECTION 6.14; AND

 

(XIII)         ALL NON-RECURRING CASH RESTRUCTURING CHARGES TAKEN WITHIN 36
MONTHS AFTER THE CLOSING DATE NOT TO EXCEED $5,000,000 IN THE AGGREGATE;

 

provided, that to the extent the receipt of any Net Cash Proceeds of any
Permitted Equity Issuance are an effective addition to Consolidated EBITDA as
contemplated by, and in

 

11

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accordance with, the provisions of subclause (b)(xii) above and, as a result
thereof, any Event of Default in respect of the covenants set forth in Section
6.14 shall have been cured for any applicable period, such cure shall be deemed
to be effective as of the last day of such applicable period; provided, further,
that with respect to any Specified Transaction, for purposes of determining (1)
compliance with the covenants set forth in Section 6.14 (but excluding for
purposes of the definition of “Applicable Rate”), Consolidated EBITDA shall be
calculated on a Pro Forma Basis for such Specified Transaction and (2) the
calculation of the “Applicable Rate,” Consolidated EBITDA shall be calculated on
a Pro Forma Basis for such Specified Transaction, but without giving effect to
estimated cost savings reduction referred to in the definition of “Pro Forma
Basis,” in each case, subject to the adjustments set forth in Schedule 1.01(c).

 

“Consolidated Net Income” means, for any period, the net income (or net loss) of
any Person and its Subsidiaries for such period, determined on a Consolidated
basis and in accordance with GAAP, but excluding for each such period (without
duplication), the income (or loss) of any other Person (other than a Subsidiary
of such Person) in which a Person other than such Person or any of its
Subsidiaries owns or otherwise holds an Equity Interest, except to the extent
such income (or loss) shall have been received in the form of cash dividends or
other distributions actually paid to such Person or any of its Subsidiaries by
such other Person during such period; provided that Consolidated Net Income for
any such period shall not include (A) the cumulative effect of a change in
accounting principles during such period, (B) any net after-tax income or loss
(less all fees and expenses or charges relating thereto) attributable to the
early extinguishment of Indebtedness, (C) any non-cash charges resulting from
mark-to-market accounting relating to warrants and (D) any non-cash impairment
charges resulting from the application of Statement of Financial Accounting
Standards No. 142 – Goodwill and Other Intangibles and No. 144 – Accounting for
the Impairment or Disposal of Long-Lived Assets and the amortization of
intangibles including arising pursuant to Statement of Financial Accounting
Standards No. 141 – Business Combinations.

 

“Constitutive Documents” means, with respect to any Person, the certificate of
incorporation, formation or registration (including, if applicable, certificate
of change of name), articles of incorporation or association, memorandum of
association, charter, bylaws, partnership agreement, trust agreement, limited
liability company operating or members agreement, joint venture agreement or one
or more similar agreements, instruments or documents constituting the
organization or formation of such Person.

 

“Contingent Obligation” means, with respect to any Person, without duplication,
any obligation of such Person to guarantee or intended to guarantee any
Indebtedness, leases, dividends or other obligations (“primary obligations”) of
any other Person (the “primary obligor”) in any manner, whether directly or
indirectly, including, without limitation, (a) the direct or indirect guaranty,
endorsement (other than for collection or deposit in the ordinary course of
business), co-making, discounting with recourse or sale with recourse by such
Person of the obligation of a primary obligor, (b) the obligation to make
take-or-pay or similar payments, if required, regardless of nonperformance by
any other party or parties to an agreement or (c) any obligation of such Person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (A) for the purchase or payment of any such primary obligation or
(B) to maintain working capital, equity capital, net worth or any other balance
sheet condition or

 

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any income statement condition of the primary obligor or otherwise to maintain
the solvency of the primary obligor, (iii) to purchase, lease or otherwise
acquire property, assets, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the primary
obligor to make payment of such primary obligation or (iv) otherwise to assure
or hold harmless the holder of such primary obligation against loss in respect
thereof.  The amount of any Contingent Obligation shall be deemed to be an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Contingent Obligation is made (or, if less, the maximum
amount of such primary obligation for which such Person may be liable pursuant
to the terms of the agreement, instrument or other document evidencing such
Contingent Obligation) or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof, as determined by such Person in good
faith.

 

“Continuing Directors” shall mean (a) in the case of the Borrower, the directors
of the Borrower on the Closing Date, after giving effect to the Nu-Gro
Acquisition and the other transactions contemplated hereby, and each other
director, if, in each case, such other directors’ nomination for election to the
board of directors is recommended by a majority of the then Continuing Directors
or such other director receives the vote of the Equity Investors in his or her
election by the stockholders of the Borrower and (b) in the case of Holdings,
upon and after the occurrence of the Holding Company Event, the directors of
Holdings on the date of the occurrence of the Holdings Company Event and each
other director, if, in each case, such other directors’ nomination for election
to the board of directors is recommended by a majority of the then Continuing
Directors or such other director receives the vote of the Equity Investors in
his or her election by the stockholders of Holdings.

 

“Control” has the meaning specified in the definition of “Affiliate.”

 

“Credit Extension” means each of the following:  (a) a Borrowing and (b) an L/C
Credit Extension.

 

“Cumulative Excess Cash Flow” means the sum of Excess Cash Flow for each Fiscal
Year commencing with the Fiscal Year ended December 31, 2004 and ending with the
Borrower’s most recently ended Fiscal Year.

 

“Current Assets” means, with respect to any Person, all assets of such Person
that, in accordance with GAAP, would be classified as current assets on the
balance sheet of a Person conducting a business the same as or similar to that
of such Person, after deducting appropriate and adequate reserves therefrom in
accordance with GAAP.

 

“Current Liabilities” means, with respect to any Person, as of any date of
determination, (a) all Indebtedness of such Person that by its terms is payable
on demand or matures within one year after the date of determination (excluding
any Indebtedness renewable or extendible, at the option of such Person, to a
date more than one year from such date or arising under a revolving credit or
similar agreement that obligates the lender or lenders to extend credit during a
period of more than one year from such date), (b) all amounts of Funded
Indebtedness of such Person required to be paid or prepaid within one year after
such date and (c) all other items (including, without limitation, taxes accrued
as estimated and trade payables otherwise excluded from Indebtedness under
clause (b) of the definition thereof set forth below in this

 

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Section 1.01) that, in accordance with GAAP, would be classified on the balance
sheet of such Person as current liabilities of such Person, but excluding for
all purposes the Outstanding Amount of all Revolving Credit Loans, Swing Line
Loans and L/C Credit Extensions.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all
other liquidation, conservatorship, bankruptcy, general 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 event or condition that constitutes an Event of Default or
that, with the giving of any notice, the passage of time, or both, would be an
Event of Default.

 

“Default Rate” means (a) when used with respect to Obligations other than as set
forth in clause (b) below, an interest rate equal to (i) the Base Rate plus (ii)
the Applicable Rate, if any, applicable to Base Rate Loans plus (iii) 2.0% per
annum; provided, however, that with respect to a Eurodollar Rate Loan or a
Screen Rate Loan, the Default Rate shall be an interest rate equal to the
interest rate (including any Applicable Rate) otherwise applicable to such Loan
plus 2.0% per annum and (b) when used with respect to Letter of Credit Fees, a
rate equal to the Applicable Rate plus 2% per annum, in all cases to the fullest
extent permitted by applicable Laws.

 

“Defaulting Lender” means any Lender that (a) has failed to fund any portion of
the Term Loans, Revolving Credit Loans, participations in L/C Obligations or
participations in Swing Line Loans required to be funded by it hereunder within
one Business Day of the date required to be funded by it hereunder, (b) has
otherwise failed to pay over to the Administrative Agent or any other Lender any
other amount required to be paid by it hereunder within one Business Day of the
date when due, unless the subject of a good faith dispute, or (c) has been
deemed insolvent or become the subject of a bankruptcy or insolvency proceeding.

 

“Deferred Payment Obligation” means the obligation of the L/C Issuer to make
payment to a beneficiary arising under a Letter of Credit a fixed number of
calendar days after such beneficiary presents the documents called for in such
Letter of Credit and with respect to which a draft is not drawn by the
beneficiary.

 

“Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property by
any Person, including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith (it being understood that the abandonment of any IP Right
which abandonment is otherwise not prohibited by the terms of the Loan Documents
shall not be deemed a Disposition).

 

“Documentation Agent” means Citigroup Global Markets, Inc. in its capacity as
documentation agent hereunder.

 

“Dollar” and “$” mean lawful money of the United States.

 

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“Dollar Equivalent” means, on any date of determination, in relation to an
amount denominated in a currency other than Dollars, the amount of Dollars which
could be purchased with such amount at the Spot Rate on such date.

 

“Dollar Term Borrowing” means a borrowing consisting of simultaneous Dollar Term
Loans of the same Type and, in the case of Eurodollar Rate Loans, having the
same Interest Period, made by the Dollar Term Lenders pursuant to Section
2.01(a).

 

“Dollar Term Commitment” means, as to each Dollar Term Lender, its obligation to
make a Dollar Term Loan to the Borrower pursuant to Section 2.01(a) in a
principal amount not to exceed the amount set forth opposite such Lender’s name
on Schedule 2.01 under the caption “Dollar Term Commitment” or in the Assignment
and Assumption pursuant to which such Lender becomes a party hereto, as
applicable, as such amount may be adjusted from time to time in accordance with
this Agreement.

 

“Dollar Term Facility” means, at any time, the aggregate Dollar Term Commitments
or Dollar Term Loans, as applicable, of all Dollar Term Lenders at such time.

 

“Dollar Term Lenders” means each of the Term Lenders whose Term Commitment is
denominated in Dollars, as set forth on Schedule 2.01 hereto.

 

“Dollar Term Loan” has the meaning specified in Section 2.01(a).

 

“Domestic Subsidiary” means, at any time, each of the direct and indirect
Subsidiaries of the Borrower that is incorporated under the laws of any state of
the United States of America or the District of Columbia.

 

“Eligible Assignee” has the meaning specified in Section 10.07(g).

 

“Environmental Laws” means any and all applicable Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions and discharges to waste or public
systems.

 

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower, any other Loan Party or any of their
respective Subsidiaries resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling, transportation, storage,
treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous
Materials, (d) the release or threatened release of any Hazardous Materials into
the environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing; provided, however that Environmental Liability shall not include the
routine costs of complying with Environmental Laws and obtaining and complying
with Environmental Permits that are incurred in the ordinary course of business
and for which financial reserves are not accrued and Capital Expenditures are
not budgeted.

 

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“Environmental Permit” means any permit, approval, identification number,
license or other authorization required under any Environmental Law.

 

“Equity Interests” means, with respect to any Person, all of the shares of
capital stock of (or other ownership or profit interests in) such Person, all of
the warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other ownership or profit interests in)
such Person, all of the securities convertible into or exchangeable for shares
of capital stock of (or other ownership or profit interests in) such Person or
warrants, rights or options for the purchase or acquisition from such Person of
such shares (or such other interests), and all of the other ownership or profit
interests in such Person (including, without limitation, partnership, member or
trust interests therein), whether voting or nonvoting, and whether or not such
shares, warrants, options, rights or other interests are outstanding on any date
of determination.

 

“Equity Investors” means, at any time, the Sponsor and the Management
Shareholders.

 

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

 

“ERISA Affiliate” means any trade or business (whether or not incorporated)
under common control with the Borrower within the meaning of Section 414(b) or
(c) of the Code (and Sections 414(m) and (o) of the Code for purposes of
provisions relating to Section 412 of the Code).

 

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by any of the Loan Parties or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by any of the Loan Parties or any
ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer
Plan is in reorganization; (d) the filing of a notice of intent to terminate,
the treatment of an amendment to a Pension Plan or to a Multiemployer Plan as a
termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which constitutes grounds under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Pension
Plan or Multiemployer Plan; or (f) the imposition of any liability under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, upon any of the Loan Parties or any ERISA Affiliate.

 

“Eurodollar Rate” means for any Interest Period with respect to a Eurodollar
Rate Loan, a rate per annum determined by the Administrative Agent pursuant to
the following formula:

 

Eurodollar Rate  =

 

LIBO Rate

 

 

1.00 — Eurodollar Reserve Percentage

 

Where,

 

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“LIBO Rate” means, for such Interest Period:

 

(A)           THE RATE PER ANNUM EQUAL TO THE RATE DETERMINED BY THE
ADMINISTRATIVE AGENT TO BE THE OFFERED RATE THAT APPEARS ON THE PAGE OF THE
TELERATE SCREEN (OR ANY SUCCESSOR THERETO) THAT DISPLAYS AN AVERAGE BRITISH
BANKERS ASSOCIATION INTEREST SETTLEMENT RATE FOR DEPOSITS IN DOLLARS (FOR
DELIVERY ON THE FIRST DAY OF SUCH INTEREST PERIOD) WITH A TERM EQUIVALENT TO
SUCH INTEREST PERIOD, DETERMINED AS OF APPROXIMATELY 11:00 A.M. (LONDON TIME)
TWO BUSINESS DAYS PRIOR TO THE FIRST DAY OF SUCH INTEREST PERIOD, OR

 

(B)           IF THE RATE REFERENCED IN THE PRECEDING CLAUSE (A) DOES NOT APPEAR
ON SUCH PAGE OR SERVICE OR SUCH PAGE OR SERVICE SHALL NOT BE AVAILABLE, THE RATE
PER ANNUM EQUAL TO THE RATE DETERMINED BY THE ADMINISTRATIVE AGENT TO BE THE
OFFERED RATE ON SUCH OTHER PAGE OR OTHER SERVICE THAT DISPLAYS AN AVERAGE
BRITISH BANKERS ASSOCIATION INTEREST SETTLEMENT RATE FOR DEPOSITS IN DOLLARS
(FOR DELIVERY ON THE FIRST DAY OF SUCH INTEREST PERIOD) WITH A TERM EQUIVALENT
TO SUCH INTEREST PERIOD, DETERMINED AS OF APPROXIMATELY 11:00 A.M. (LONDON TIME)
TWO BUSINESS DAYS PRIOR TO THE FIRST DAY OF SUCH INTEREST PERIOD, OR

 

(C)           IF THE RATES REFERENCED IN THE PRECEDING CLAUSES (A) AND (B) ARE
NOT AVAILABLE, THE RATE PER ANNUM DETERMINED BY THE ADMINISTRATIVE AGENT AS THE
RATE OF INTEREST AT WHICH DEPOSITS IN DOLLARS FOR DELIVERY ON THE FIRST DAY OF
SUCH INTEREST PERIOD IN SAME DAY FUNDS IN THE APPROXIMATE AMOUNT OF THE
EURODOLLAR RATE LOAN BEING MADE, CONTINUED OR CONVERTED BY BANK OF AMERICA AND
WITH A TERM EQUIVALENT TO SUCH INTEREST PERIOD WOULD BE OFFERED BY BANK OF
AMERICA’S LONDON BRANCH TO MAJOR BANKS IN THE LONDON INTERBANK EURODOLLAR MARKET
AT THEIR REQUEST AT APPROXIMATELY 4:00 P.M. (LONDON TIME) TWO BUSINESS DAYS
PRIOR TO THE FIRST DAY OF SUCH INTEREST PERIOD.

 

“Eurodollar Reserve Percentage” means, for any day during any Interest Period,
the reserve percentage (expressed as a decimal, carried out to five decimal
places) in effect on such day, whether or not applicable to any Lender, under
regulations issued from time to time by the FRB for determining the maximum
reserve requirement (including any emergency, supplemental or other marginal
reserve requirement) with respect to Eurocurrency funding (currently referred to
as “Eurocurrency liabilities”).  The Eurodollar Rate for each outstanding
Eurodollar Rate Loan shall be adjusted automatically as of the effective date of
any change in the Eurodollar Reserve Percentage.

 

“Eurodollar Rate Loan” means a Loan that bears interest at a rate based on the
Eurodollar Rate.

 

“Event of Default” has the meaning specified in Section 8.01.

 

“Excess Cash Flow” means, with respect to any Fiscal Year of the Borrower and
its Subsidiaries on a Consolidated basis, an amount equal to (a) Consolidated
EBITDA minus (b) without duplication,

 

(I)            THE AGGREGATE AMOUNT OF ALL CAPITAL EXPENDITURES MADE IN CASH BY
THE BORROWER AND ITS SUBSIDIARIES DURING SUCH PERIOD,

 

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(II)           THE AGGREGATE AMOUNT OF ALL CONSOLIDATED CASH INTEREST EXPENSES
MADE BY THE BORROWER AND ITS SUBSIDIARIES DURING SUCH PERIOD,

 

(III)          THE AGGREGATE AMOUNT OF ALL TAXES, INCLUDING CASH PAYMENTS FOR
FEDERAL, STATE AND OTHER INCOME AND FRANCHISE TAX LIABILITIES PAID BY THE
BORROWER AND ITS SUBSIDIARIES DURING SUCH PERIOD,

 

(IV)          THE AGGREGATE AMOUNT OF ALL SCHEDULED PRINCIPAL PAYMENTS MADE BY
THE BORROWER AND ITS SUBSIDIARIES DURING SUCH PERIOD,

 

(V)           THE AGGREGATE AMOUNT OF ALL RESTRICTED PAYMENTS MADE IN CASH BY
THE BORROWER DURING SUCH PERIOD TO THE EXTENT THAT SUCH RESTRICTED PAYMENTS ARE
PERMITTED TO BE MADE UNDER SECTION 7.06,

 

(VI)          THE AGGREGATE AMOUNT OF ALL (A) VOLUNTARY PREPAYMENTS OF ANY
INDEBTEDNESS (OTHER THAN THE OBLIGATIONS) AND (B) MANDATORY PAYMENTS MADE
PURSUANT TO SECTION 2.05(B)(I), IN EACH CASE, MADE IN CASH BY THE BORROWER AND
ITS SUBSIDIARIES DURING SUCH PERIOD; PROVIDED, THAT (1) SUCH PREPAYMENTS WERE
NOT OTHERWISE PROHIBITED HEREUNDER AND (2) IN THE CASE OF CLAUSE (A), IF SUCH
INDEBTEDNESS CONSISTS OF A REVOLVING LINE OF CREDIT, THE COMMITMENTS UNDER SUCH
LINE OF CREDIT ARE PERMANENTLY REDUCED BY THE AMOUNT OF SUCH PREPAYMENT,

 

(VII)         NON-RECURRING CASH CHARGES TO THE EXTENT INCLUDED IN DETERMINING
CONSOLIDATED EBITDA,

 

(VIII)        MANAGEMENT FEES PERMITTED TO BE PAID PURSUANT TO SECTION 6.10;

 

(IX)           PROCEEDS RECEIVED BY OR ON BEHALF OF THE BORROWER AND ITS
SUBSIDIARIES FROM INSURANCE CLAIMS WITH RESPECT TO CASUALTY EVENTS, BUSINESS
INTERRUPTION OR PRODUCT RECALLS WHICH REIMBURSE PRIOR BUSINESS EXPENSES,

 

(X)            CASH EXPENSES OR CHARGES INCURRED IN CONNECTION WITH OR IN
CONTEMPLATION OF THE NU-GRO TRANSACTION OR, TO THE EXTENT PERMITTED HEREUNDER,
ANY INVESTMENT PERMITTED UNDER SECTION 7.05, ISSUANCE OF EQUITY INTERESTS OR
ISSUANCE OR INCURRENCE OF INDEBTEDNESS PERMITTED BY SECTION 7.02 (WHETHER OR NOT
CONSUMMATED),

 

(XI)           FEES AND EXPENSES (INCLUDING ANY APPLICABLE PREMIUM) IN
CONNECTION WITH THE EXCHANGE OF THE SENIOR SUBORDINATED NOTES FOR REGISTERED
NOTES WITH IDENTICAL TERMS AS CONTEMPLATED BY THE SENIOR SUBORDINATED NOTES
DOCUMENTS OR EXCHANGES, REDEMPTIONS OR REFINANCINGS PERMITTED BY THIS AGREEMENT,

 

(XII)          CASH INDEMNITY PAYMENTS RECEIVED PURSUANT TO INDEMNIFICATION
PROVISIONS IN ANY AGREEMENT IN CONNECTION WITH A PERMITTED ACQUISITION (OR IN
ANY SIMILAR AGREEMENT RELATED TO ANY OTHER ACQUISITION CONSUMMATED PRIOR TO THE
CLOSING DATE),

 

(XIII)         EXPENSES INCURRED IN CONNECTION WITH DEFERRED COMPENSATION
ARRANGEMENTS IN CONNECTION WITH THE NU-GRO TRANSACTION,

 

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(XIV)        CASH FROM OPERATIONS USED TO CONSUMMATE A PERMITTED ACQUISITION,

 

(XV)         TO THE EXTENT ADDED TO CONSOLIDATED NET INCOME IN DETERMINING
CONSOLIDATED EBITDA, NET CASH PROCEEDS OF PERMITTED EQUITY ISSUANCES,

 

(XVI)        CASH EXPENDITURES MADE IN RESPECT OF SWAP CONTRACTS DURING SUCH
PERIOD TO THE EXTENT NOT REFLECTED IN THE COMPUTATION OF CONSOLIDATED EBITDA OR
CONSOLIDATED CASH INTEREST EXPENSE,

 

(XVII)       TO THE EXTENT NOT DEDUCTED IN THE COMPUTATION OF NET CASH PROCEEDS
IN RESPECT OF ANY DISPOSITION OR CONDEMNATION GIVING RISE THERETO, THE AMOUNT OF
ANY MANDATORY PREPAYMENT OF INDEBTEDNESS (OTHER THAN INDEBTEDNESS HEREUNDER OR
UNDER ANY OTHER LOAN DOCUMENT), TOGETHER WITH ANY INTEREST, PREMIUM OR PENALTIES
REQUIRED TO BE PAID (AND ACTUALLY PAID) IN CONNECTION THEREWITH,

 

(XVIII)      NET CASH PROCEEDS PENDING REINVESTMENT IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 2.05(B),

 

(XIX)         CASH PAYMENTS MADE IN SATISFACTION OF NON-CURRENT LIABILITIES, AND

 

(XX)          THE AGGREGATE AMOUNT OF ALL EXTRAORDINARY CASH CHARGES MADE BY THE
BORROWER AND ITS SUBSIDIARIES DURING SUCH PERIOD,

 

plus (c) the aggregate amount of all extraordinary cash gains received by the
Borrower and its Subsidiaries during such period plus/minus (d) changes in
Working Capital.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, and the regulations promulgated and the rulings issued thereunder.

 

“Existing Credit Agreement” has the meaning specified in the preliminary
statements to this Agreement.

 

“Existing Letters of Credit” means the Letters of Credit Specified on Schedule
1.01(a).

 

“Facility” means the Term Facility, the Revolving Credit Facility, the Swing
Line Sublimit or the Letter of Credit Sublimit, as the context may require.

 

“Fair Market Value” means, with respect to any property or assets (including,
without limitation, any of the Equity Interests) of any Person on any date of
determination, the value of the consideration obtainable in a sale of such
property or asset in the open market on such date assuming an arm’s-length sale
that has been arranged without duress or compulsion between a willing seller and
a willing and knowledgeable purchaser in a commercially reasonable manner over a
reasonable period of time under all conditions necessary or desirable for a fair
sale (taking into account the nature and characteristics of such property or
asset); provided that the Fair Market Value of any of the property or assets of
any of the Loan Parties or any of their respective Subsidiaries shall be
determined in good faith by the board of directors (or

 

19

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the persons performing similar functions) of such Loan Party or such Subsidiary,
as the case may be.

 

“Federal Funds Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of
America on such day on such transactions as determined by the Administrative
Agent.

 

“Fee Letter” means the letter agreement, dated February 29, 2004, among the
Borrower, the Administrative Agent, BAS, Bank of America, CGMI and Citicorp
North America, Inc.

 

“Fiscal Quarter” means, with respect to Holdings, the Borrower or any of their
respective Subsidiaries, the period commencing January 1 in any Fiscal Year and
ending on or about the next succeeding March 31, the period commencing on or
about April 1 in any Fiscal Year and ending on or about the next succeeding
June 30, the period commencing on or about July 1 in any Fiscal Year and ending
on or about the next succeeding September 30 or the period commencing on or
about October 1 (such period, in each case, determined in a manner consistent
with prior practice) in any Fiscal Year and ending on the next succeeding
December 31, as the context may require, or, if any such Subsidiary was not in
existence on the first day of any such period, the period commencing on the date
on which such Subsidiary is incorporated, organized, formed or otherwise created
and ending on the last day of such period.

 

“Fiscal Year” means, with respect to Borrower or any of its Subsidiaries, the
period commencing on January 1 in any calendar year and ending on the next
succeeding December 31 or, if any such Subsidiary was not in existence on
January 1 in any calendar year, the period commencing on the date on which such
Subsidiary is incorporated, organized, formed or otherwise created and ending on
the next succeeding December 31; provided that with respect to Nu-Gro and its
Subsidiaries, for any period occurring prior to the Closing Date, “Fiscal Year”
shall mean each period commencing on October 1 in any calendar year and ending
on the next succeeding September 30.

 

“Foreign Corporation” means each Foreign Subsidiary that constitutes a
“controlled foreign corporation” under Section 957 of the Internal Revenue Code.

 

“Foreign Lender” has the meaning specified in Section 10.15(a)(i).

 

“Foreign Subsidiary” means, at any time, each of the direct or indirect
Subsidiaries of the Borrower that is not a Domestic Subsidiary at such time.

 

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

 

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“Fund” has the meaning specified in Section 10.07(g).

 

“Funded Indebtedness” means, with respect to any Person (a) Indebtedness in
respect of the Credit Extensions, in the case of the Borrower, and (b) all other
Indebtedness of the types described in clauses (a), (c), (e) and (i) of the
definition of “Indebtedness” of such Person that by its terms matures more than
one year after the date of its creation or matures within one year from such
date but is renewable or extendible, at the option of such Person, to a date
more than one year after such date or arises under a revolving credit or similar
agreement that obligates the lender or lenders to extend credit during a period
of more than one year after such date.

 

“GAAP” means generally accepted accounting principles in effect from time to
time in the United States of America and applied on a consistent basis or
Canadian GAAP, as the context may require or as otherwise applicable, subject,
however, to the terms of Section 1.03.

 

“Governmental Authority” means any nation or government, any state, province,
city, municipal entity or other political subdivision thereof, and any
governmental, executive, legislative, judicial, administrative or regulatory
agency, department, authority, instrumentality, commission, board or similar
body, whether federal, state, territorial, local or foreign.

 

“Governmental Authorization” means any authorization, approval, consent,
franchise, license, covenant, order, ruling, permit, certification, exemption,
notice, declaration or similar right, undertaking or other action of, to or by,
or any filing, qualification or registration with, any Governmental Authority.

 

“Granting Lender” has the meaning specified in Section 10.07(h).

 

“Guarantee Supplement” has the meaning specified in Section 8(b) of the
Guaranty.

 

“Guarantee” means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other 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 obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other 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 obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other 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
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien).  The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the

 

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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.

 

“Guarantors” means, collectively, (i) the Domestic Subsidiaries of the Borrower
listed on Schedule 5.02, (ii) each other Subsidiary of Holdings or the Borrower,
as the case may be, that shall be required to execute and deliver a Guaranty or
Guarantee Supplement pursuant to Section 6.11 and (iii) upon delivery of the
Holdings Joinder Agreement and Guaranty pursuant to Section 6.15, Holdings.

 

“Guaranty” means, collectively, (i) each Subsidiary Guaranty made by the
Guarantors in favor of the Administrative Agent on behalf of the Lenders in each
case, substantially in the form of Exhibit F, (ii) each other Guaranty and
Guarantee Supplement delivered pursuant to Section 6.11 and (iii) the Holdings
Joinder Agreement and Guaranty.

 

“Hazardous Materials” means all explosive or radioactive substances or wastes
and all toxic substances, wastes or other pollutants regulated or characterized
as “hazardous” or “toxic” pursuant to Environmental Law or which would form the
basis for liability under Environmental Law due to their toxicity, including
petroleum or petroleum distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls and all other substances or wastes of any nature
regulated pursuant to any Environmental Law.

 

“Hedge Bank” means any Person that is a Lender or an Affiliate of a Lender, in
its capacity as a party to a Secured Hedge Agreement.

 

“Holding Company Event” means the transactions occurring on or after the Closing
Date pursuant to which Holdings becomes the direct parent company of the
Borrower.

 

“Holdings “ means a corporation or limited liability company organized under the
laws of a jurisdiction located within the United States that directly owns 100%
of the Equity Interests in the Borrower.

 

“Holdings Joinder Agreement and Guaranty” has the meaning specified in
Section 6.15.

 

“Holdings Total Leverage Ratio” means, at any date of determination, the ratio
of (a) (i) all Funded Indebtedness of Holdings and its Subsidiaries (other than
the aggregate principal amount of all Revolving Credit Loans, Swing Line Loans
and L/C Advances outstanding on such date) outstanding on such date plus (ii)
the average daily aggregate principal amount of all Revolving Credit Loans,
Swing Line Loans and L/C Advances outstanding on the last day of each month
during the most recently completed Measurement Period divided by 12 less (iii)
the aggregate amount of all cash on the Consolidated balance sheet of Holdings
on the last day of each month during the most recent Measurement Period divided
by 12 to (b) Consolidated EBITDA of Holdings and its Subsidiaries for the period
of the four prior Fiscal Quarters ending on such date.

 

“Honor Date” has the meaning specified in Section 2.03(c)(i).

 

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“Increase Effective Date” has the meaning specified in Section 2.14(b).

 

“Indebtedness” means, with respect to any Person (without duplication):

 

(A)           ALL INDEBTEDNESS OF SUCH PERSON FOR BORROWED MONEY;

 

(B)           ALL OBLIGATIONS OF SUCH PERSON FOR THE DEFERRED PURCHASE PRICE OF
PROPERTY AND ASSETS OR SERVICES (OTHER THAN TRADE PAYABLES OR OTHER ACCOUNTS
PAYABLE INCURRED IN THE ORDINARY COURSE OF SUCH PERSON’S BUSINESS AND NOT PAST
DUE, BY THEIR RESPECTIVE TERMS, FOR MORE THAN 90 DAYS);

 

(C)           ALL OBLIGATIONS OF SUCH PERSON EVIDENCED BY NOTES, BONDS,
DEBENTURES OR OTHER SIMILAR INSTRUMENTS;

 

(D)           ALL OBLIGATIONS OF SUCH PERSON CREATED OR ARISING UNDER ANY
CONDITIONAL SALE OR OTHER TITLE RETENTION AGREEMENT WITH RESPECT TO PROPERTY OR
ASSETS ACQUIRED BY SUCH PERSON (EVEN THOUGH THE RIGHTS AND REMEDIES OF THE
SELLER OR THE LENDER UNDER SUCH AGREEMENT IN THE EVENT OF DEFAULT ARE LIMITED TO
REPOSSESSION OR SALE OF SUCH PROPERTY OR ASSETS);

 

(E)           ALL OBLIGATIONS OF SUCH PERSON AS LESSEE UNDER CAPITALIZED LEASES;

 

(F)            ALL OBLIGATIONS, CONTINGENT OR OTHERWISE, OF SUCH PERSON UNDER
ACCEPTANCE, LETTER OF CREDIT OR SIMILAR FACILITIES;

 

(G)           ALL OBLIGATIONS OF SUCH PERSON TO PURCHASE, REDEEM, RETIRE,
DEFEASE OR OTHERWISE MAKE ANY PAYMENT IN RESPECT OF ANY REDEEMABLE EQUITY
INTERESTS IN SUCH PERSON OR ANY OTHER PERSON, VALUED, IN THE CASE OF REDEEMABLE
PREFERRED INTERESTS, AT THE GREATER OF ITS VOLUNTARY OR INVOLUNTARY LIQUIDATION
PREFERENCE PLUS ACCRUED AND UNPAID DIVIDENDS;

 

(H)           ALL OBLIGATIONS, CONTINGENT OR OTHERWISE, OF SUCH PERSON IN
RESPECT OF SWAP CONTRACTS, IN EACH CASE VALUED AT THE AGREEMENT VALUE THEREOF;

 

(I)            ALL OBLIGATIONS OF SUCH PERSON UNDER ANY SYNTHETIC LEASE, TAX
RETENTION OPERATING LEASE, OFF-BALANCE SHEET LOAN OR SIMILAR OFF-BALANCE SHEET
FINANCING, IF THE TRANSACTION GIVING RISE TO SUCH OBLIGATION IS CONSIDERED
INDEBTEDNESS FOR BORROWED MONEY FOR TAX PURPOSES BUT IS CLASSIFIED AS AN
OPERATING LEASE IN ACCORDANCE WITH GAAP;

 

(J)            ALL CONTINGENT OBLIGATIONS OF SUCH PERSON IN RESPECT OF
OBLIGATIONS OF A TYPE DESCRIBED IN CLAUSES (A) THROUGH (I) ABOVE; AND

 

(K)           ALL INDEBTEDNESS REFERRED TO IN CLAUSES (A) THROUGH (J) ABOVE
SECURED BY (OR FOR WHICH THE HOLDER OF SUCH INDEBTEDNESS HAS AN EXISTING RIGHT,
CONTINGENT OR OTHERWISE, TO BE SECURED BY) ANY LIEN ON PROPERTY OR ASSETS
(INCLUDING, WITHOUT LIMITATION, ACCOUNTS AND CONTRACT RIGHTS) OWNED BY SUCH
PERSON, EVEN THOUGH SUCH PERSON HAS NOT ASSUMED OR BECOME LIABLE FOR THE PAYMENT
OF SUCH INDEBTEDNESS, VALUED AT THE LESSER OF (I) THE AGGREGATE UNPAID AMOUNT OF
SUCH INDEBTEDNESS OR, IF NOT STATED OR DETERMINABLE, THE

 

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MAXIMUM REASONABLY ANTICIPATED LIABILITY IN RESPECT THEREOF AND (II) THE FAIR
MARKET VALUE OF SUCH PROPERTY OR ASSETS.

 

The Indebtedness of any Person shall include all Obligations of the types
described in clauses (a) through (k) above of any partnership in which such
Person is a general partner or joint venture (other than a joint venture that is
itself a corporation or limited liability company) of which such Person is a
joint venturer, unless such Indebtedness is expressly made non-recourse to such
Person.

 

“Indemnified Liabilities” has the meaning specified in Section 10.05.

 

“Indemnitees” has the meaning specified in Section 10.05.

 

“Information” has the meaning specified in Section 10.08.

 

“Information Memorandum” means the information memorandum dated March, 2004 used
by the Arrangers in connection with the syndication of the Commitments.

 

“Intellectual Property Security Agreement” has the meaning specified in
Section 4.01(a)(v).

 

“Interest Coverage Ratio” means, for any Measurement Period, the ratio of (a)
Consolidated EBITDA of the Borrower and its Subsidiaries for the period of the
four prior Fiscal Quarters ending on such date to (b) Consolidated Cash Interest
Expense of the Borrower and its Subsidiaries for such period; provided that,
solely for the purposes of determining the Interest Coverage Ratio for the first
three Measurement Periods ending after the Closing Date, the Consolidated Cash
Interest Expense of the Borrower and its Subsidiaries for such Measurement
Period shall be equal to (A) the Consolidated Cash Interest Expense for the
completed Fiscal Quarters since the Closing Date multiplied by (B) a fraction
the numerator of which is four and the denominator of which is equal to the
number of completed Fiscal Quarters since the Closing Date, subject in each case
to the adjustments set forth on Schedule 1.01(c).

 

“Interest Payment Date” means, (a) as to any Loan other than a Base Rate Loan,
the last day of each Interest Period applicable to such Loan and the Maturity
Date of the Facility under which such Loan was made; provided, however, that if
any Interest Period for a Eurodollar Rate Loan or Screen Rate Loan exceeds three
months, the respective dates that fall every three months after the beginning of
such Interest Period shall also be Interest Payment Dates; and (b) as to any
Base Rate Loan (including a Swing Line Loan), the last Business Day of each
March, June, September and December and the Maturity Date of the Facility under
which such Loan was made.

 

“Interest Period” means, as to each Eurodollar Rate Loan and Screen Rate Loan,
the period commencing on the date such Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan or Screen Rate Loan and ending on the date
one, two, three or six months thereafter, as selected by the Borrower in its
Committed Loan Notice, or to the extent available to all applicable Lenders,
nine or twelve months thereafter; provided that:

 

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(I)            ANY INTEREST PERIOD THAT WOULD OTHERWISE END ON A DAY THAT IS NOT
A BUSINESS DAY SHALL BE EXTENDED TO THE NEXT SUCCEEDING BUSINESS DAY UNLESS SUCH
BUSINESS DAY FALLS IN ANOTHER CALENDAR MONTH, IN WHICH CASE SUCH INTEREST PERIOD
SHALL END ON THE NEXT PRECEDING BUSINESS DAY;

 

(II)           ANY INTEREST PERIOD THAT BEGINS ON THE LAST BUSINESS DAY OF A
CALENDAR MONTH (OR ON A DAY FOR WHICH THERE IS NO NUMERICALLY CORRESPONDING DAY
IN THE CALENDAR MONTH AT THE END OF SUCH INTEREST PERIOD) SHALL END ON THE LAST
BUSINESS DAY OF THE CALENDAR MONTH AT THE END OF SUCH INTEREST PERIOD; AND

 

(III)          NO INTEREST PERIOD SHALL EXTEND BEYOND THE MATURITY DATE OF THE
FACILITY UNDER WHICH SUCH LOAN WAS MADE.

 

“Investment” means, with respect to any Person, (a) any direct or indirect
purchase or other acquisition (whether for cash, securities, property, services
or otherwise) by such Person of, or of a beneficial interest in, any Equity
Interests or Indebtedness of any other Person, (b) any direct or indirect
purchase or other acquisition (whether for cash, securities, property, services
or otherwise) by such Person of all or substantially all of the property and
assets of any other Person or of any division, branch or other unit of operation
of any other Person and (c) the making of any direct or indirect loan, advance,
other extension of credit or capital contribution by such Person to, or any
other investment by such Person in, any other Person (including, without
limitation, any arrangement pursuant to which the investor incurs Indebtedness
of the types referred to in clause (j) or (k) of the definition of
“Indebtedness” set forth above in this Section 1.01 in respect of such other
Person).  The amount of any Investment shall be the original cost of such
Investment plus the cost of all additions thereto, without any adjustments for
increases or decreases in value, or write-ups, write-downs or write-offs with
respect to such Investment.

 

“IP Rights” has the meaning specified in Section 5.11.

 

“IP Security Agreement Supplement” has the meaning specified in Section 1 of the
Security Agreement.

 

“IRS” means the United States Internal Revenue Service.

 

“ISDA Master Agreement” means the Master Agreement (Multicurrency-Cross Border)
published by the International Swap and Derivatives Association, Inc., as in
effect from time to time.

 

“ISP” means, with respect to any Letter of Credit, the “International Standby
Practices 1998” published by the Institute of International Banking Law &
Practice (or such later version thereof as may be in effect at the time of
issuance).

 

“Issuer Documents” means with respect to any Letter of Credit, the Letter of
Credit Application, and any other document, agreement and instrument entered
into by the L/C Issuer and the Borrower (or any of its Subsidiaries) or in favor
the L/C Issuer and relating to any such Letter of Credit.

 

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“Judgment Currency” has the meaning specified in Section 10.20.

 

“Laws” means, collectively, all applicable 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, licenses, authorizations and
permits of, and settlement agreements with, any Governmental Authority, in each
case whether or not having the force of law.

 

“L/C Advance” means, with respect to each Revolving Credit Lender, such Lender’s
funding of its participation in any L/C Borrowing in accordance with its Pro
Rata Share.

 

“L/C Borrowing” means an extension of credit resulting from a drawing under any
Letter of Credit which has not been reimbursed as provided in Section 2.03(c) or
refinanced as a Revolving Credit Borrowing.

 

“L/C Cash Collateral Account” means a blocked, non-interest bearing deposit
account at Bank of America in the name of the Collateral Agent and under the
sole dominion and control of the Collateral Agent, and otherwise established in
a manner satisfactory to the Administrative Agent.

 

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance
thereof or extension of the expiry date thereof, or the renewal or increase of
the amount thereof.

 

“L/C Issuer” means Bank of America in its capacity as issuer of Letters of
Credit hereunder, or any successor issuer of Letters of Credit hereunder.

 

“L/C Obligations” means, as at any date of determination, the aggregate undrawn
amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings plus, without duplication,
the aggregate amount of all Acceptances and Deferred Payment Obligations.

 

“Lender” has the meaning specified in the introductory paragraph hereto and, as
the context requires, includes the L/C Issuer and the Swing Line Lender.

 

“Lending Office” means, as to any Lender, the office or offices of such Lender
described as such in such Lender’s Administrative Questionnaire, or such other
office or offices as a Lender may from time to time notify the Borrower and the
Administrative Agent.

 

“Letter of Credit” means any letter of credit issued hereunder and shall include
the Existing Letters of Credit.  A Letter of Credit may be a commercial letter
of credit or a standby letter of credit.

 

“Letter of Credit Application” means an application and agreement for the
issuance or amendment of a Letter of Credit in the form from time to time in use
by the L/C Issuer.

 

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“Letter of Credit Expiration Date” means the day that is seven days prior to the
Maturity Date then in effect for the Revolving Credit Facility (or, if such day
is not a Business Day, the next preceding Business Day).

 

“Letter of Credit Fee” has the meaning specified in Section 2.03(i).

 

“Letter of Credit Sublimit” means an amount equal to $20,000,000.  The Letter of
Credit Sublimit is part of, and not in addition to, the Revolving Credit
Facility.

 

“LIBO Rate” has the meaning set forth in the definition of Eurodollar Rate.

 

“Lien” means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement in the nature of
a security interest of any kind or nature whatsoever (including any conditional
sale or other title retention agreement, any easement, right of way or other
encumbrance on title to real property, and any financing lease having
substantially the same economic effect as any of the foregoing).

 

“Loan” means an extension of credit by a Lender to the Borrower under Article II
in the form of a Term Loan, a Revolving Credit Loan or a Swing Line Loan.

 

“Loan Documents” means, collectively, (a) for purposes of this Agreement and the
Notes and any amendment, supplement or other modification hereof or thereof and
for all other purposes other than for purposes of the Guaranty and the
Collateral Documents, (i) this Agreement, (ii) the Notes, (iii) the Guaranty,
(iv) the Collateral Documents, (v) the Fee Letter and (vi) each Issuer Document
and (b) for purposes of the Guaranty and the Collateral Documents, (i) this
Agreement, (ii) the Notes, (iii) the Guaranty, (iv) the Collateral Documents,
(v) each Issuer Document, (vi) the Fee Letter and (vii) each Secured Hedge
Agreement.

 

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

 

“Management Shareholders” means Robert Caulk, Daniel Johnston, Steven Schultz
and David Jones.

 

“Master Agreement” has the meaning specified in the definition of “Swap
Contract.”

 

“Material Adverse Effect” means a material adverse effect on (a) the business,
condition (financial or otherwise), operations, liabilities (actual or
contingent), or properties of the Borrower and its Subsidiaries, taken as a
whole, (b) the rights and remedies of the Administrative Agent or the Lenders
under any of the Loan Documents or (c) the ability of any of the Loan Parties to
perform its Obligations under any of the Loan Documents to which it is or is to
be a party.

 

“Maturity Date” means (a) with respect to the Revolving Credit Facility, the
earliest of (i) April 30, 2010, (ii) the date of termination in whole of the
Revolving Credit Commitments pursuant to Section 2.06 or 8.01, and (iii) the
Alternate Date and (b) with respect

 

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to the Term Facility, the earlier of (i) April 30, 2011, (ii) the date of
termination in whole of the Term Commitments pursuant to Section 2.06 or 8.01
and (iii) the Alternate Date.

 

“Maximum Rate” has the meaning specified in Section 10.10.

 

“Measurement Period” means, at any date of determination, the most recently
completed four consecutive Fiscal Quarters on or immediately prior to such date.

 

“Mortgages” has the meaning specified in Section 4.01(a)(iv).

 

“Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which any of the Loan Parties or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
five plan years, has made or been obligated to make contributions.

 

“Net Cash Proceeds” means, with respect to any Disposition of any property or
assets, or the incurrence or issuance of any Indebtedness, or the sale or
issuance of any Equity Interests in any Person, or any condemnation or casualty
insurance proceeds received by or paid to or for the account of any Person, as
the case may be, the aggregate amount of cash received from time to time
(whether as initial consideration or through payment or disposition of deferred
consideration, but only as and when received) by or on behalf of such Person for
its own account in connection with any such transaction, after deducting
therefrom only:

 

(A)           REASONABLE BROKERAGE COMMISSIONS, UNDERWRITING FEES AND DISCOUNTS,
LEGAL FEES, FINDER’S FEES AND OTHER SIMILAR FEES, COSTS AND COMMISSIONS AND
REASONABLE OUT-OF-POCKET EXPENSES INCURRED IN CONNECTION THEREWITH;

 

(B)           THE AMOUNT OF TAXES PAYABLE IN CONNECTION WITH OR AS A RESULT OF
SUCH TRANSACTION (INCLUDING INCOME TAXES REASONABLY ESTIMATED TO BE ACTUALLY
PAYABLE WITHIN TWO (2) YEARS OF THE DATE OF SUCH TRANSACTION AS A RESULT OF ANY
GAIN RECOGNIZED IN CONNECTION THEREWITH);

 

(C)           IN THE CASE OF ANY DISPOSITION OF ANY PROPERTY OR ASSET (INCLUDING
ANY CASUALTY OR CONDEMNATION OF SUCH ASSET), THE OUTSTANDING PRINCIPAL AMOUNT
OF, THE PREMIUM OR PENALTY, IF ANY, ON, AND ANY ACCRUED AND UNPAID INTEREST ON,
ANY INDEBTEDNESS (OTHER THAN INDEBTEDNESS UNDER OR IN RESPECT OF THE LOAN
DOCUMENTS) THAT IS SECURED BY A LIEN ON THE PROPERTY AND ASSETS SUBJECT TO SUCH
DISPOSITION AND IS REPAID AS A RESULT OF DISPOSITION; AND

 

(D)           IN THE CASE OF THE DISPOSITION OF ANY PROPERTY AND ASSETS
(INCLUDING ANY CASUALTY OR CONDEMNATION OF SUCH ASSET) OF THE BORROWER OR ANY OF
ITS SUBSIDIARIES , ANY RESERVE FOR ADJUSTMENT IN RESPECT OF (X) THE SALE PRICE
OF SUCH ASSET OR ASSETS ESTABLISHED IN ACCORDANCE WITH GAAP AND (Y) ANY
LIABILITIES ASSOCIATED WITH SUCH ASSET OR ASSETS AND RETAINED BY HOLDINGS, THE
BORROWER OR ANY OF THEIR RESPECTIVE SUBSIDIARIES AFTER SUCH SALE OR OTHER
DISPOSITION THEREOF, INCLUDING, WITHOUT LIMITATION, PENSION AND OTHER
POST-EMPLOYMENT BENEFIT LIABILITIES AND LIABILITIES RELATED TO ENVIRONMENTAL
MATTERS OR AGAINST ANY INDEMNIFICATION OBLIGATIONS ASSOCIATED WITH SUCH
TRANSACTION;

 

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in each case to the extent, but only to the extent, that the amounts so deducted
are properly attributable to such transaction or to the property or asset that
is the subject thereof and (i) in the case of clauses (a) and (c) of this
definition, are actually paid at the time of receipt of such cash or within 60
days thereafter to a Person that is not a Loan Party or Subsidiary of a Loan
Party, (ii) in the case of clause (b) of this definition, are actually paid at
the time of receipt of such cash or within 60 days thereafter to a Person that
is not a Loan Party or Subsidiary of a Loan Party or, so long as such Person is
not otherwise indemnified therefor, are reserved for in accordance with GAAP, as
in effect at the time of receipt of such cash (based upon such Person’s
reasonable estimate of such taxes), and paid to the applicable taxation
authority or other Governmental Authority on or before when due and (iii) in the
case of clause (d) of this definition, are actually paid to the purchaser of the
related property and assets within the period specified for payment thereof in
the applicable purchase agreement to a Person that is not a Loan Party or
Subsidiary of a Loan Party; provided, however, that if, at the time any such
taxes or post-closing purchase price adjustments are actually paid or otherwise
satisfied, the reserve therefor or the amount otherwise retained by such Person
or its applicable Subsidiary for the payment thereof exceeds the amount paid or
otherwise satisfied, then the amount of such excess reserve or retained amount,
as the case may be, shall constitute “Net Cash Proceeds” on and as of the date
of such payment or other satisfaction for all purposes of this Agreement and, to
the extent required under Sections 2.05(b) and 2.06(b), the Borrower shall
reduce the Commitments on such date in accordance with the terms of Section
2.06(b), and shall prepay the Loans and cash collateralize the Letters of Credit
outstanding on such date in accordance with the terms of Section 2.05(b), in an
amount equal to the amount of such excess reserve or retained amount.

 

“Nonextension Notice Date” has the meaning specified in Section 2.03(b)(iii).

 

“Note” means a Term Note or a Revolving Credit Note, as the context may require.

 

“Notice of Intent to Cure” has the meaning specified in Section 6.13(d)(ii).

 

“NPL” means the National Priorities List under CERCLA.

 

“Nu-Gro” has the meaning specified in the preliminary statements to this
Agreement.

 

“Nu-Gro Acquisition” has the meaning specified in the preliminary statements to
this Agreement.

 

“Nu-Gro Acquisition Documents” means, collectively, the Arrangement Agreement
and  Shareholders Agreement.

 

“Nu-Gro Material Adverse Effect” means (a) any adverse effect of $1,000,000 or
more on the business, operations (including results of operations), assets,
properties, capital or condition (financial or otherwise) of Nu-Gro and its
Subsidiaries, taken as a whole (other than any effect of (i) developments in the
industries in which Nu-Gro carries on business which do not have a
disproportionate impact on Nu-Gro or its Subsidiaries and (ii) changes in the
price of the Nu-Gro Common Shares (as defined in the Arrangement Agreement) in
response to the

 

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announcement of the Nu-Gro Acquisition) or (b) any adverse effect on the rights
and remedies of the Administrative Agent or the Lenders under the Loan
Documents.

 

“Nu-Gro Transaction” means, collectively, the Nu-Gro Acquisition, the U.S.
Reorganization, the Preferred Stock Redemption, the entering into and funding of
the Facilities and all related transactions.

 

“Obligations” means all advances to, and debts, liabilities, obligations,
covenants and duties of, any Loan Party arising under any Loan Document or
otherwise with respect to any Loan or Letter of Credit, whether direct or
indirect (including those acquired by assumption), 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 of any
proceeding under any Debtor Relief Laws naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in
such proceeding. Without limiting the generality of the foregoing, the
Obligations of the Loan Parties under the Loan Documents include (a) the
obligation to pay principal, interest, Letter of Credit commissions, charges,
expenses, fees, Attorney Costs, indemnities and other amounts payable by any
Loan Party under any Loan Document and (b) the obligation of any Loan Party to
reimburse any amount in respect of any of the foregoing that the Administrative
Agent, in its sole discretion, may elect to pay or advance on behalf of such
Loan Party upon the failure of such Loan Party to pay such amount.

 

“Open Year” means, with respect to any Person, any year for which United States
federal income tax returns have been filed by or on behalf of such Person and
for which the expiration of the applicable statute of limitations for
assessment, reassessment or collection has not occurred (whether by reason of
extension or otherwise).

 

“Operating Lease” means, with respect to any Person, any lease (including,
without limitation, leases that may be terminated by the lessee at any time) of
any property (whether real, personal or mixed) that is not a Capitalized Lease
or a lease under which such Person is the lessor.

 

“Other Taxes” has the meaning specified in Section 3.01(b).

 

“Outstanding Amount” means (i) with respect to Term Loans, Revolving Credit
Loans and Swing Line Loans on any date, the aggregate outstanding principal
amount thereof after giving effect to any borrowings and prepayments or
repayments of Term Loans, Revolving Credit Loans and Swing Line Loans, as the
case may be, occurring on such date; and (ii) with respect to any L/C
Obligations on any date, the amount of such L/C Obligations on such date after
giving effect to any L/C Credit Extension occurring on such date and any other
changes in the aggregate amount of the L/C Obligations as of such date,
including as a result of any reimbursements of outstanding unpaid drawings under
any Letters of Credit or any reductions in the maximum amount available for
drawing under Letters of Credit taking effect on such date.

 

“Parent” means a corporation or limited liability company organized under the
laws of a jurisdiction located within the United States that, upon consummation
of the Holding Company Event, directly owns 100% of the Equity Interests of
Holdings.

 

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“Participant” has the meaning specified in Section 10.07(d).

 

“PBGC” means the Pension Benefit Guaranty Corporation.

 

“Pension Plan” means any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by any of the Loan
Parties or any ERISA Affiliate or to which any of the Loan Parties or any ERISA
Affiliate contributes or has an obligation to contribute, or in the case of a
multiple employer or other plan described in Section 4064(a) of ERISA, has made
contributions at any time during the immediately preceding five plan years.

 

“Permitted Acquisition” has the meaning specified in Section 7.05(h).

 

“Permitted Affiliate Investment” means (a) any capital contributions to the
Borrower (or upon consummation of the Holding Company Event, Holdings) made
directly or indirectly by one or more of the Equity Investors (and, upon
consummation of the Holding Company Event, contributed by Holdings to the
Borrower) or (b) the Net Cash Proceeds received by the Borrower or Holdings, as
the case may be, from the issuance and sale of Equity Interests to one or more
of the Equity Investors (and, upon consummation of the Holding Company Event,
contributed by Holdings to the Borrower); provided that on the date on which any
such Permitted Affiliate Investment is made, the Borrower shall deliver to the
Administrative Agent, on behalf of the Lenders, a certificate of a Responsible
Officer of the Borrower certifying that such capital contributions or the Net
Cash Proceeds received by the Borrower from such issuance and sale are intended
to constitute, and are to be used for, one or more Investments to be made in
accordance with the terms of Section 7.05(h), or one or more Restricted Payments
to be made in accordance with the terms of Section 7.06.

 

“Permitted Equity Issuance” means any sale or issuance of any Equity Interests
(other than Redeemable Equity Interests) of Holdings to the extent (a) Holdings
contributes the Net Cash Proceeds thereof to the Borrower and (b) such Net Cash
Proceeds are not required to be applied to the prepayment of the Loans pursuant
to Section 2.05(b).

 

“Permitted Holdco Debt” has the meaning specified in Section 7.02(c)(ii).

 

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

 

(A)           LIENS FOR TAXES, ASSESSMENTS AND GOVERNMENTAL CHARGES OR LEVIES TO
THE EXTENT NOT OTHERWISE REQUIRED TO BE PAID UNDER SECTION 6.02;

 

(B)           LIENS IMPOSED BY LAW, SUCH AS MATERIALMEN’S, MECHANICS’,
CARRIERS’, WORKMEN’S, STORAGE AND REPAIRMEN’S LIENS AND OTHER SIMILAR LIENS
ARISING IN THE ORDINARY COURSE OF BUSINESS AND SECURING OBLIGATIONS (OTHER THAN
INDEBTEDNESS FOR BORROWED MONEY) TO THE EXTENT NOT OTHERWISE REQUIRED TO BE PAID
UNDER SECTION 6.02;

 

(C)           LIENS INCURRED OR PLEDGES OR DEPOSITS MADE TO SECURE OBLIGATIONS
INCURRED IN THE ORDINARY COURSE OF BUSINESS UNDER WORKERS’ COMPENSATION LAWS,
UNEMPLOYMENT

 

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INSURANCE OR OTHER SIMILAR SOCIAL SECURITY LEGISLATION (OTHER THAN IN RESPECT OF
EMPLOYEE BENEFIT PLANS SUBJECT TO ERISA) OR TO SECURE PUBLIC OR STATUTORY
OBLIGATIONS;

 

(D)           LIENS SECURING THE PERFORMANCE OF, OR PAYMENT IN RESPECT OF, BIDS,
INSURANCE PREMIUMS, DEDUCTIBLES OR CO-INSURED AMOUNTS, TENDERS, GOVERNMENT OR
UTILITY CONTRACTS (OTHER THAN FOR THE REPAYMENT OF BORROWED MONEY), SURETY,
STAY, CUSTOMS AND APPEAL BONDS AND OTHER OBLIGATIONS OF A SIMILAR NATURE
INCURRED IN THE ORDINARY COURSE OF BUSINESS;

 

(E)           ANY INTEREST OR TITLE OF A LESSOR OR SUBLESSOR OR A LICENSOR AND
ANY RESTRICTION OR ENCUMBRANCE TO WHICH THE INTEREST OR TITLE OF SUCH LESSOR,
SUBLESSOR OR LICENSOR MAY BE SUBJECT THAT IS INCURRED IN THE ORDINARY COURSE OF
BUSINESS;

 

(F)            LIENS ARISING OUT OF JUDGMENTS OR AWARDS THAT DO NOT CONSTITUTE
AN EVENT OF DEFAULT UNDER SECTION 8.01(G);

 

(G)           LIENS IN FAVOR OF CUSTOMS AND REVENUE AUTHORITIES ARISING AS A
MATTER OF LAW OR PURSUANT TO A BOND TO SECURE PAYMENT OF CUSTOMS DUTIES IN
CONNECTION WITH THE IMPORTATION OF GOODS;

 

(H)           CUSTOMARY RIGHTS OF SETOFF UPON DEPOSITS OF CASH IN FAVOR OF BANKS
OR OTHER DEPOSITORY INSTITUTIONS IN WHICH SUCH CASH IS MAINTAINED IN THE
ORDINARY COURSE OF BUSINESS;

 

(I)            EASEMENTS, RIGHTS-OF-WAY, ZONING RESTRICTIONS AND OTHER
ENCUMBRANCES AND SURVEY EXCEPTIONS, MINOR DEFECTS OR IRREGULARITIES IN TITLE AND
OTHER SIMILAR RESTRICTIONS ON TITLE TO, OR THE USE OF, REAL PROPERTY THAT DO
NOT, EITHER INDIVIDUALLY OR IN THE AGGREGATE, MATERIALLY AND ADVERSELY AFFECT
THE USE OF SUCH REAL PROPERTY FOR ITS INTENDED PURPOSES OR THE CONDUCT OF THE
BUSINESS OF THE BORROWER AND ITS SUBSIDIARIES IN THE ORDINARY COURSE AND, IN ANY
CASE, THAT WERE NOT INCURRED IN CONNECTION WITH AND DO NOT SECURE INDEBTEDNESS
OR OTHER EXTENSIONS OF CREDIT;

 

(J)            LIENS ARISING OUT OF CONDITIONAL SALE, TITLE RETENTION,
CONSIGNMENT OR SIMILAR ARRANGEMENTS FOR THE SALE OF GOODS ENTERED INTO BY THE
BORROWER OR ANY OF ITS SUBSIDIARIES IN THE ORDINARY COURSE OF BUSINESS AND NOT
PROHIBITED BY THIS AGREEMENT; AND

 

(K)           LIENS ENCUMBERING REASONABLE CUSTOMARY INITIAL DEPOSITS AND MARGIN
DEPOSITS AND SIMILAR LIENS ATTACHING TO COMMODITY TRADING ACCOUNTS OR OTHER
BROKERAGE ACCOUNTS INCURRED IN THE ORDINARY COURSE OF BUSINESS AND NOT FOR
SPECULATIVE PURPOSES.

 

“Permitted Subordinated Indebtedness” means any unsecured Indebtedness of the
Borrower that (a) is expressly subordinated to the prior payment in full in cash
of the Obligations on terms and conditions no less favorable to the Lenders than
the terms and conditions of the Senior Subordinated Notes, (b) will not mature
prior to the date that is ninety-one (91) days after the scheduled Maturity Date
of the Term Facility, (c) has no scheduled amortization or payments of principal
prior to the scheduled Maturity Date of the Term Facility, and (d) has covenant,
default and remedy provisions no more restrictive, and mandatory prepayment,
repurchase or redemption provisions no more onerous or expansive in scope, than

 

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those contained in the Senior Subordinated Notes Documents, taken as a whole;
provided any such Indebtedness shall constitute Permitted Subordinated
Indebtedness only if (i) both before and after giving effect to the issuance or
incurrence thereof, no Default or Event of Default shall have occurred and be
continuing, and (ii) the Chief Financial Officer of the Borrower shall have
delivered an officer’s certificate demonstrating Pro Forma Compliance with the
covenants set forth in Section 6.14 in form and substance reasonably
satisfactory to the Administrative Agent, it being understood that any
capitalized or paid-in-kind interest or accreted principal on such Indebtedness
shall not constitute an issuance or incurrence of Indebtedness for purposes of
this proviso.

 

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

 

“Plan” means any “employee benefit plan” (as such term is defined in Section
3(3) of ERISA), other than a Multiemployer Plan, established by any of the Loan
Parties or, with respect to any such plan that is subject to Section 412 of the
Code or Title IV of ERISA, any ERISA Affiliate.

 

“Pledged Debt” has the meaning specified in Section 1 of the Security Agreement.

 

“Pledged Equity” has the meaning specified in Section 1 of the Security
Agreement.

 

“Preferred Interests” means, with respect to any Person, Equity Interests issued
by such Person that are entitled to a preference or priority over any other
Equity Interests issued by such Person upon any distribution of such Person’s
property and assets, whether by dividend or upon liquidation.

 

“Preferred Stock Redemption” has the meaning specified in the preliminary
statements to this Agreement.

 

“primary obligations” has the meaning specified in the definition of “Contingent
Obligation” set forth above in this Section 1.01.

 

“primary obligor” has the meaning specified in the definition of “Contingent
Obligation” set forth above in this Section 1.01.

 

“Pro Forma Basis”, “Pro Forma Compliance” and “Pro Forma Effect” means, for
purposes of calculating compliance with each of the financial covenants set
forth in Section 6.14 or Section 7.02(c)(ii), as applicable, in respect of a
Specified Transaction, that such Specified Transaction and the following
transactions in connection therewith shall be deemed to have occurred as of the
first day of the applicable Measurement Period:  (a) income statement items
(whether positive or negative) attributable to the property or Person subject to
such Specified Transaction, (i) in the case of a Disposition of all or
substantially all Equity Interests in any Subsidiary of the Borrower or any
division, product line, or facility used for operations of the Borrower or any
of its Subsidiaries, shall be excluded, and (ii) in the case of a Permitted
Acquisition or Investment described in the definition of  “Specified
Transaction”, shall be

 

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included, (b) any retirement of Indebtedness, and (c) any Indebtedness incurred
or assumed by the Borrower or any of its Subsidiaries in connection therewith
and if such Indebtedness has a floating or formula rate, shall have an implied
rate of interest for the applicable period for purposes of this definition
determined by utilizing the rate which is or would be in effect with respect to
such Indebtedness as at the relevant date of determination.  Calculations made
pursuant to this definition shall be (i) determined in good faith by a
Responsible Officer of the Borrower and may include adjustments, in the
reasonable determination of the Borrower as set forth in an officer’s
certificate, to reflect operating expense reductions reasonably expected to
result from any Specified Transaction or Specified Disposition and (ii)
reasonably acceptable to the Administrative Agent.  With respect to any
determination of Pro Forma Compliance which is required to be made pursuant to
the terms of this Agreement on a date other than the last day of a Fiscal
Quarter, then such determination shall be made in respect of the Measurement
Period ending on the last day of the Fiscal Quarter most recently ended and for
which financial statements have been delivered to the Administrative Agent
pursuant to Section 6.13.

 

“Pro Rata Share” means, with respect to each Lender at any time, a fraction
(expressed as a percentage, carried out to the ninth decimal place), the
numerator of which is the amount of the Commitment(s) of such Lender under the
applicable Facility or Facilities at such time and the denominator of which is
the amount of the Aggregate Commitments under the applicable Facility or
Facilities at such time; provided that if the commitment of each Lender to make
Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have
been terminated pursuant to Section 8.01, then the Pro Rata Share of each Lender
shall be determined based on the Pro Rata Share of such Lender immediately prior
to such termination and after giving effect to any subsequent assignments made
pursuant to the terms hereof.  The initial Pro Rata Share of each Lender is set
forth opposite the name of such Lender on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.

 

“Professional Services Agreement” means the Professional Services Agreement
dated as of January 20, 1999 by and among THL Equity Advisors IV, L.L.C., Thomas
H. Lee Capital, L.L.C. and the Borrower, as such agreement may be amended,
supplemented or otherwise modified hereafter from time to time in accordance
with the terms thereof, but solely to the extent permitted under the terms of
the Loan Documents.

 

“Qualifying IPO” means the issuance by Parent or Holdings of its common Equity
Interests in an underwritten primary public offering (other than a public
offering pursuant to a registration statement on Form S-8) pursuant to an
effective registration statement filed with the SEC in accordance with the
Securities Act of 1933, as amended (whether alone or in connection with a
secondary public offering).

 

“Redeemable” means (a) any Equity Interest that the issuer has undertaken to
redeem at a fixed or determinable date or dates, whether by operation of a
sinking fund or otherwise, or upon the occurrence of a condition not solely
within the control of the issuer or (b) any Equity Interest that is redeemable
at the option of the holder, in each case, occurring earlier than 91 days
following the scheduled Maturity Date of any Facility.

 

“Reduction Amount” has the meaning set forth in Section 2.05(b)(vi).

 

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“Register” has the meaning set forth in Section 10.07(c).

 

“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.

 

“Request for Credit Extension” means (a) with respect to a Borrowing, conversion
or continuation of Term Loans or Revolving Credit Loans, a Committed Loan
Notice, (b) with respect to an L/C Credit Extension, a Letter of Credit
Application, and (c) with respect to a Swing Line Loan, a Swing Line Loan
Notice.

 

“Required Financial Information” means, at any date of determination, the
Consolidated financial statements of Borrower and its Subsidiaries most recently
delivered to the Administrative Agent on or prior to such date pursuant to, and
satisfying all of the requirements of, Section 6.13(b) or 6.13(c) and
accompanied by the certificates and other information required to be delivered
therewith pursuant to Section 6.13(d).

 

“Required Lenders” means, as of any date of determination, Lenders having more
than 50% of the sum of the (a) Total Outstandings (with the aggregate amount of
each Lender’s risk participation and funded participation in L/C Obligations and
Swing Line Loans being deemed “held” by such Lender for purposes of this
definition), (b) aggregate unused Term Commitments and (c) aggregate unused
Revolving Credit Commitments; provided that the unused Term Commitment, unused
Revolving Credit Commitment of, and the portion of the Total Outstandings held
or deemed held by, any Defaulting Lender shall be excluded for purposes of
making a determination of Required Lenders.

 

“Requirements of Law” means, with respect to any Person, all laws,
constitutions, statutes, treaties, ordinances, rules and regulations, all
orders, writs, decrees, injunctions, judgments, determinations and awards of an
arbitrator, a court or any other Governmental Authority, and all Governmental
Authorizations, binding upon or applicable to such Person or any of its
Subsidiaries or to any of their property, assets or businesses.

 

“Responsible Officer” means (i) the chief executive officer, the president, the
chief financial officer, the principal accounting officer, any vice president,
secretary or the treasurer (or the equivalent of any of the foregoing) of the
Borrower (or upon the consummation of the Holding Company Event, Holdings) or
any of its Subsidiaries and (ii) in the case of a Committed Loan Notice or a
Swing Line Loan Notice, any person authorized to sign such Committed Loan Notice
or Swing Line Loan Notice by the board of directors of the Borrower.

 

“Restricted Payment” has the meaning specified in Section 7.06.

 

“Restricted Subsidiary” means (a) each of the wholly owned Domestic Subsidiaries
and each of the other Subsidiaries of the Borrower (or upon the consummation of
the Holding Company Event, Holdings) that is organized, purchased or otherwise
acquired after the Closing Date, whether pursuant to Section 7.05(h) or
otherwise (other than any non-wholly owned Domestic Subsidiary or any Foreign
Subsidiary that is a CFC that is organized, purchased or otherwise acquired
pursuant to Section 7.05(i)), or (b) each of the other Subsidiaries of the
Borrower (or upon the consummation of the Holding Company Event, Holdings) that,
at the option of the Borrower (i) executes and delivers the Guaranty or a
Guarantee Supplement and a

 

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Security Agreement Supplement, (ii) in which 100% of the issued and outstanding
Equity Interests are pledged to the Administrative Agent, on behalf of the
Secured Parties, pursuant to the applicable Collateral Documents and (iii)
delivers such other agreements, opinions, certificates and other documents as
are required or requested under Section 6.11.

 

“Revolving Credit Borrowing” means a borrowing consisting of simultaneous
Revolving Credit Loans of the same Type and, in the case of Eurodollar Rate
Loans, having the same Interest Period made by each of the Revolving Credit
Lenders pursuant to Section 2.01(b).

 

“Revolving Credit Commitment” means, as to each Revolving Credit Lender, its
obligation to (a) make Revolving Credit Loans to the Borrower pursuant to
Section 2.01(b), (b) purchase participations in L/C Obligations, and (c)
purchase participations in Swing Line Loans, in an aggregate principal amount at
any one time outstanding not to exceed the amount set forth opposite such
Lender’s name on Schedule 2.01 under the caption “Revolving Credit Commitment”
or in the Assignment and Assumption pursuant to which such Lender becomes a
party hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.

 

“Revolving Credit Facility” means, at any time, the aggregate amount of the
Revolving Credit Lenders’ Revolving Credit Commitments at such time.

 

“Revolving Credit Lender” means, at any time, any Lender that has a Revolving
Credit Commitment at such time.

 

“Revolving Credit Loan” has the meaning specified in Section 2.01(b).

 

“Revolving Credit Note” means a promissory note of the Borrower payable to the
order of any Revolving Credit Lender or its registered assigns, in substantially
the form of Exhibit C-2 hereto, evidencing the aggregate indebtedness of the
Borrower to such Revolving Credit Lender resulting from the Revolving Credit
Loans made by such Revolving Credit Lender.

 

“Scheduled Principal Payments” means, with respect to any Person for any period,
the sum of all regularly scheduled principal payments or repurchases,
redemptions or similar acquisitions for value of outstanding Indebtedness made
or required to be made during such period, including, without limitation, all
repayments of Loans outstanding hereunder pursuant to Section 2.07(a) or
2.07(b).

 

“Screen Rate” means, with respect to any Canadian Term Loan for any Interest
Period:

 

(A)           THE RATE PER ANNUM EQUAL TO THE RATE DETERMINED BY THE
ADMINISTRATIVE AGENT TO BE THE OFFERED RATE THAT APPEARS ON THE PAGE OF THE
TELERATE SCREEN (OR ANY SUCCESSOR THERETO) THAT DISPLAYS AN AVERAGE BRITISH
BANKERS ASSOCIATION INTEREST SETTLEMENT RATE FOR DEPOSITS IN CANADIAN DOLLARS
(FOR DELIVERY ON THE FIRST DAY OF SUCH INTEREST PERIOD) WITH A TERM EQUIVALENT
TO SUCH INTEREST PERIOD, DETERMINED AS OF APPROXIMATELY 11:00 A.M. (LONDON TIME)
TWO BUSINESS DAYS PRIOR TO THE FIRST DAY OF SUCH INTEREST PERIOD; OR

 

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(B)           IF THE RATE REFERENCED IN THE PRECEDING CLAUSE (A) DOES NOT APPEAR
ON SUCH PAGE OR SERVICE OR SUCH PAGE OR SERVICE SHALL CEASE TO BE AVAILABLE, THE
RATE PER ANNUM EQUAL TO THE RATE DETERMINED BY THE ADMINISTRATIVE AGENT TO BE
THE OFFERED RATE ON SUCH OTHER PAGE OR OTHER SERVICE THAT DISPLAYS AN AVERAGE
BRITISH BANKERS ASSOCIATION INTEREST SETTLEMENT RATE FOR DEPOSITS IN CANADIAN
DOLLARS (FOR DELIVERY ON THE FIRST DAY OF SUCH INTEREST PERIOD) WITH A TERM
EQUIVALENT TO SUCH INTEREST PERIOD, DETERMINED AS OF APPROXIMATELY 11:00 A.M.
(LONDON TIME) TWO BUSINESS DAYS PRIOR TO THE FIRST DAY OF SUCH INTEREST PERIOD.

 

“Screen Rate Loan” means a Loan that bears interest at the Screen Rate.

 

“SEC” means the U.S. Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.

 

“Secured Hedge Agreement” means any interest rate Swap Contract permitted under
Article VI or VII that is entered into by and between the Borrower and any Hedge
Bank.

 

“Secured Obligations” has the meaning specified in Section 2 of the Security
Agreement.

 

“Secured Parties” means, collectively, the Administrative Agent, the Lenders,
the Hedge Banks, each co-agent or sub-agent appointed by the Administrative
Agent from time to time pursuant to Section 9.01(c), or Section 9.02, and the
other Persons the Obligations owing to which are or are purported to be secured
by the Collateral under the terms of the Collateral Documents.

 

“Security Agreement” has the meaning specified in Section 4.01(a)(iii).

 

“Security Agreement Supplement” has the meaning specified in Section 1 of the
Security Agreement.

 

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

 

“Senior Subordinated Notes” means the senior unsecured subordinated notes of the
Borrower due 2009 in an aggregate principal amount of $231,900,000.

 

“Senior Subordinated Notes Documents” means all indentures, securities purchase
agreements, and other agreements, instruments and documents pursuant to which
the Senior Subordinated Notes have been issued or otherwise setting forth the
terms of the Senior Subordinated Notes, in each case as such agreement,
instrument or other document may be amended, supplemented or otherwise modified
from time to time in accordance with the terms thereof, but solely to the extent
permitted under the terms of the Loan Documents.

 

“Shareholders Agreement” means that certain letter agreement dated March 1, 2004
(as amended, supplemented or otherwise modified to the Closing Date) among the
Borrower, Jupiter Acquisition Corporation, Austin Beutel, Robert Beutel and
Oakwest Corporation Limited.

 

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“Sight Draft” means a draft drawn by a beneficiary under a Letter of Credit and
presented to the L/C Issuer, which draft is payable upon presentation to the L/C
Issuer together with the documents called for under such Letter of Credit.

 

“Solvent” and “Solvency” mean, with respect to any Person on any date of
determination, that, on such date:

 

(A)           THE FAIR VALUE OF THE PROPERTY AND ASSETS OF SUCH PERSON IS
GREATER THAN THE TOTAL AMOUNT OF LIABILITIES (INCLUDING, WITHOUT LIMITATION,
CONTINGENT LIABILITIES) OF SUCH PERSON;

 

(B)           THE PRESENT FAIR SALABLE VALUE OF THE PROPERTY AND ASSETS OF SUCH
PERSON IS NOT LESS THAN THE AMOUNT THAT WILL BE REQUIRED TO PAY THE PROBABLE
LIABILITY OF SUCH PERSON ON ITS DEBTS AS THEY BECOME ABSOLUTE AND MATURED;

 

(C)           SUCH PERSON DOES NOT INTEND TO, AND DOES NOT BELIEVE THAT IT WILL,
INCUR DEBTS OR LIABILITIES BEYOND SUCH PERSON’S ABILITY TO PAY SUCH DEBTS AND
LIABILITIES AS THEY MATURE; AND

 

(D)           SUCH PERSON IS NOT ENGAGED IN BUSINESS OR IN A TRANSACTION, AND IS
NOT ABOUT TO ENGAGE IN BUSINESS OR IN A TRANSACTION, FOR WHICH SUCH PERSON’S
PROPERTY AND ASSETS WOULD CONSTITUTE AN UNREASONABLY SMALL CAPITAL.

 

The fair value and the present fair salable value of the property and assets of
any such Person shall be computed taking into account the aggregate amount of
all payments in respect of reimbursement, contribution and indemnification
claims against any other Person that, in light of the circumstances existing at
such time, such Person reasonably believes in good faith it will receive with
reasonable promptness.  The amount of contingent liabilities of any such Person
at any time shall be computed as the amount that, in the light of all of the
facts and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.

 

“SPC” has the meaning specified in Section 10.07(h).

 

“Specified Equity Issuance” means the sale or issuance by the Borrower (or upon
consummation of the Holding Company Event, Holdings) of any of its Equity
Interests in a public offering or in a private placement or sale that is
underwritten, managed, arranged, placed or initially purchased by an investment
bank (it being understood that the Sponsor is not an investment bank), which,
for the avoidance of doubt, does not include the sale or issuance of any such
Equity Interests (a) to the Equity Investors, their Affiliates, related funds
and general partners, (b) to other Persons making additional equity investments
together with the Equity Investors after the Closing Date, (c) pursuant to stock
option plans, (d) in connection with the cure of any financial covenant and (e)
in connection with Permitted Affiliate Investments.

 

“Specified Transaction” means, for any applicable period, the following
transactions:  any Permitted Acquisition or any Investment (or series of related
Investments) made pursuant to Section 7.05(h) or (i).

 

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“Sponsor” means the THL Entities and their Affiliates and related funds and
general partners.

 

“Spot Rate” for a currency means the rate determined by the Administrative Agent
to be the rate quoted by the Person acting in such capacity as the spot rate for
the purchase by such Person of such currency with another currency through its
principal foreign exchange trading office at approximately 11:00 a.m. on the
date two Business Days prior to the date as of which the foreign exchange
computation is made; provided that the Administrative Agent may obtain such spot
rate from another financial institution designated by the Administrative Agent
if the Person acting in such capacity does not have as of the date of
determination a spot buying rate for any such currency.

 

“Subsidiary” means, with respect to any Person, any corporation, partnership,
joint venture, limited liability company, unlimited liability company, trust or
estate of which (or in which) more than 50% of:

 

(A)           THE ISSUED AND OUTSTANDING SHARES OF CAPITAL STOCK HAVING ORDINARY
VOTING POWER TO ELECT A MAJORITY OF THE BOARD OF DIRECTORS OF SUCH CORPORATION
(IRRESPECTIVE OF WHETHER AT THE TIME SHARES OF CAPITAL STOCK OF ANY OTHER CLASS
OR CLASSES OF SUCH CORPORATION SHALL OR MIGHT HAVE VOTING POWER UPON THE
OCCURRENCE OF ANY CONTINGENCY);

 

(B)           THE INTEREST IN THE CAPITAL OR PROFITS OF SUCH PARTNERSHIP, JOINT
VENTURE, LIMITED LIABILITY COMPANY OR UNLIMITED LIABILITY COMPANY; OR

 

(C)           THE BENEFICIAL INTEREST IN SUCH TRUST OR ESTATE,

 

is at the time directly or indirectly owned or controlled by such Person, by
such Person and one or more of its other Subsidiaries or by one or more of such
Person’s other Subsidiaries.

 

“Swap Contract” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including
any such obligations or liabilities under any Master Agreement.

 

“Swing Line” means the revolving credit facility made available by the Swing
Line Lender pursuant to Section 2.04.

 

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“Swing Line Borrowing” means a borrowing of a Swing Line Loan pursuant to
Section 2.04.

 

“Swing Line Lender” means Bank of America in its capacity as provider of Swing
Line Loans, or any successor swing line lender hereunder.

 

“Swing Line Loan” has the meaning specified in Section 2.04(a).

 

“Swing Line Loan Notice” means a notice of a Swing Line Borrowing pursuant to
Section 2.04(b), which, if in writing, shall be substantially in the form of
Exhibit B.

 

“Swing Line Sublimit” means an amount equal to the lesser of (a) $10,000,000 and
(b) the Revolving Credit Commitments.  The Swing Line Sublimit is part of, and
not in addition to, the Revolving Credit Facility Commitments.

 

“Taxes” has the meaning specified in Section 3.01(a).

 

“Term Commitments” means, collectively, the Dollar Term Commitments and the
Canadian Term Commitments.

 

“Term Facility” means the Dollar Term Facility and the Canadian Term Facility.

 

“Term Lenders” means, collectively, the Dollar Term Lenders and the Canadian
Term Lenders.

 

“Term Loans” means, collectively, the Dollar Term Loans and the Canadian Term
Loans.

 

“Term Note” means a promissory note of the Borrower payable to the order of any
Term Lender or its registered assigns, in substantially the form of Exhibit C-1
hereto, evidencing the aggregate indebtedness of the Borrower to such Term
Lender resulting from the Term Loans made by such Term Lender.

 

“Termination Date” means the date on which all of the Commitments of the Lenders
have terminated or expired, all of the Loans, L/C Obligations and other
Obligations of any Loan Party under or in respect of the Loan Documents
specified in clause (a) of the definition of “Loan Documents” (other than any
such Obligations of any of the Loan Parties under Section 3.01, 3.04, 10.04 or
10.05 (or other similar provisions of the other Loan Documents that are
specified under the terms thereof to survive the payment in full of such other
Obligations under or in respect of the Loan Documents) to the extent no demand
or claim thereunder has been made) have been paid in full in cash and all
Letters of Credit have expired or been terminated or otherwise provided for in a
manner satisfactory to the L/C Issuer in full.

 

“THL Entities” means, collectively, the Thomas H. Lee Equity Fund IV, L.P. and
the Thomas H. Lee Foreign Fund IV, L.P.

 

“Total Leverage Ratio” means, at any date of determination, the ratio of (a)
(i) all Funded Indebtedness of the Borrower and its Subsidiaries (other than the
aggregate principal

 

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amount of all Revolving Credit Loans, Swing Line Loans and L/C Advances
outstanding on such date) outstanding on such date plus (ii) the aggregate
principal amount of all Revolving Credit Loans, Swing Line Loans and L/C
Advances outstanding on the last day of each month occurring during the most
recently completed Measurement Period divided by 12 less (iii) the aggregate
amount of all cash on the Consolidated balance sheet of the Borrower on the last
day of each month occurring during the most recent Measurement Period divided by
12 to (b) Consolidated EBITDA of the Borrower and its Subsidiaries for the
period of the four prior Fiscal Quarters ending on such date, subject in each
case to the adjustments set forth on Schedule 1.01(c).

 

“Total Outstandings” means the aggregate Outstanding Amount of all Loans and all
L/C Obligations.

 

“Type” means, with respect to a Loan, its character as a Base Rate Loan, a
Eurodollar Rate Loan or a Screen Rate Loan.

 

“United States” and “U.S.” mean the United States of America.

 

“Unreimbursed Amount” has the meaning specified in Section 2.03(c)(i).

 

“Unrestricted Subsidiary” means, at any time, each of the Subsidiaries of the
Borrower that does not constitute a Restricted Subsidiary at such time.

 

“Unused Revolving Credit Commitment” means, with respect to any of the Revolving
Credit Lenders at any time, (a) the Revolving Credit Commitment of such
Revolving Credit Lender at such time less (b) the sum of:

 

(i)            the aggregate principal amount of all Revolving Credit Loans,
Swing Line Loans and L/C Advances made (or deemed to have been made) by such
Revolving Credit Lender (in its capacity as a Lender) and outstanding at such
time; and

 

(ii)           such Revolving Credit Lender’s Pro Rata Share of (A) the
aggregate Available Amount of all Letters of Credit outstanding at such time,
(B) the aggregate principal amount of all L/C Advances made by the Issuing Bank
(in its capacity as the Issuing Bank) pursuant to Section 2.03(c)(i) and
outstanding at such time and (C) the aggregate principal amount of all Swing
Line Loans made by the Swing Line Bank (in its capacity as the Swing Line Bank)
pursuant to Section 2.04(a) and outstanding at such time.

 

“U.S. Lender” has the meaning set forth in Section 10.15(b).

 

“U.S. Reorganization” means the transfer of all of the shares of capital stock
of the Domestic Subsidiaries of Nu-Gro to the Borrower or such other
reorganization of the Domestic Subsidiaries of Nu-Gro as may be acceptable to
the Arrangers having the result that such Domestic Subsidiaries of Nu-Gro are
direct first or second-tier Domestic Subsidiaries of the Borrower.

 

“Withdrawal Liability” has the meaning specified in Part I of Subtitle E of
Title IV of ERISA.

 

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“Working Capital” means, with respect to any period, an amount equal to the
excess of Current Assets (other than cash and Cash Equivalents) over Current
Liabilities (excluding the current portion of any interest on any Indebtedness
which would otherwise be included therein).

 

1.02         Other Interpretive Provisions.  With reference to this Agreement
and each other Loan Document, unless otherwise specified herein or in such other
Loan Document:

 

(A)           THE MEANINGS OF DEFINED TERMS ARE EQUALLY APPLICABLE TO THE
SINGULAR AND PLURAL FORMS OF THE DEFINED TERMS.

 

(B)           (I)  THE WORDS “HEREIN,” “HERETO,” “HEREOF” AND “HEREUNDER” AND
WORDS OF SIMILAR IMPORT WHEN USED IN ANY LOAN DOCUMENT SHALL REFER TO SUCH LOAN
DOCUMENT AS A WHOLE AND NOT TO ANY PARTICULAR PROVISION THEREOF.

 

(II)           ARTICLE, SECTION, EXHIBIT AND SCHEDULE REFERENCES ARE TO THE LOAN
DOCUMENT IN WHICH SUCH REFERENCE APPEARS.

 

(III)          THE TERM “INCLUDING” IS BY WAY OF EXAMPLE AND NOT LIMITATION.

 

(IV)          THE TERM “DOCUMENTS” INCLUDES ANY AND ALL INSTRUMENTS, DOCUMENTS,
AGREEMENTS, CERTIFICATES, NOTICES, REPORTS, FINANCIAL STATEMENTS AND OTHER
WRITINGS, HOWEVER EVIDENCED, WHETHER IN PHYSICAL OR ELECTRONIC FORM.

 

(C)           IN THE COMPUTATION OF PERIODS OF TIME FROM A SPECIFIED DATE TO A
LATER SPECIFIED DATE, THE WORD “FROM” MEANS “FROM AND INCLUDING;” THE WORDS “TO”
AND “UNTIL” EACH MEAN “TO BUT EXCLUDING;” AND THE WORD “THROUGH” MEANS “TO AND
INCLUDING.”

 

(D)           SECTION HEADINGS HEREIN AND IN THE OTHER LOAN DOCUMENTS ARE
INCLUDED FOR CONVENIENCE OF REFERENCE ONLY AND SHALL NOT AFFECT THE
INTERPRETATION OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT.

 

1.03         Accounting Terms.  (a)  All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with, GAAP applied in a manner consistent with that used in preparing
the Audited Financial Statements, except as otherwise specifically prescribed
herein.

 

(B)           IF AT ANY TIME ANY CHANGE IN GAAP WOULD AFFECT THE COMPUTATION OF
ANY FINANCIAL RATIO OR REQUIREMENT SET FORTH IN ANY LOAN DOCUMENT, AND EITHER
THE BORROWER OR THE REQUIRED LENDERS SHALL SO REQUEST, THE ADMINISTRATIVE AGENT,
THE LENDERS AND THE BORROWER SHALL NEGOTIATE IN GOOD FAITH TO AMEND SUCH RATIO
OR REQUIREMENT TO PRESERVE THE ORIGINAL INTENT THEREOF IN LIGHT OF SUCH CHANGE
IN GAAP (SUBJECT TO THE APPROVAL OF THE REQUIRED LENDERS); PROVIDED THAT, UNTIL
SO AMENDED, (I) SUCH RATIO OR REQUIREMENT SHALL CONTINUE TO BE COMPUTED IN
ACCORDANCE WITH GAAP PRIOR TO SUCH CHANGE THEREIN AND (II) THE BORROWER SHALL
PROVIDE TO THE ADMINISTRATIVE AGENT AND THE LENDERS FINANCIAL STATEMENTS AND
OTHER DOCUMENTS REQUIRED UNDER THIS AGREEMENT OR AS REASONABLY REQUESTED
HEREUNDER SETTING FORTH A RECONCILIATION BETWEEN

 

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CALCULATIONS OF SUCH RATIO OR REQUIREMENT MADE BEFORE AND AFTER GIVING EFFECT TO
SUCH CHANGE IN GAAP.

 

(C)           WITH RESPECT TO THE TIME PERIOD COMMENCING MARCH 31, 2004 AND
ENDING ON JUNE 30, 2004 (THE “2004 SECOND QUARTER”), AND NOTWITHSTANDING THE
ACTUAL ACCOUNTING PERIODS FOR WHICH ANY FINANCIAL STATEMENTS WERE PREPARED FOR
THE 2004 SECOND QUARTER, THE 2004 SECOND QUARTER SHALL BE DEEMED TO CONSTITUTE
ONE ACCOUNTING PERIOD AND EACH OF CONSOLIDATED NET INCOME AND CONSOLIDATED
EBITDA SHALL BE CALCULATED WITH ALL APPLICABLE FINANCING STATEMENTS PREPARED FOR
THE 2004 SECOND QUARTER TAKEN AS A WHOLE.

 

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

 

1.05         References to Agreements and Laws.  Unless otherwise expressly
provided herein, (a) references to Constitutive Documents, agreements (including
the Loan Documents) and other contractual instruments shall be deemed to include
all subsequent amendments, restatements, extensions, supplements and other
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Law shall include all statutory
and regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Law.

 

1.06         Times of Day.  Unless otherwise specified, all references herein to
times of day shall be references to Eastern time (daylight or standard, as
applicable).

 

1.07         Currency Equivalents Generally.  Any amount specified in this
Agreement (other than in Articles II, IX and X) or any of the other Loan
Documents to be in a currency other than Dollars shall also include the
equivalent of such amount in Dollars, such equivalent amount to be determined at
the rate of exchange quoted by Bank of America in New York at the close of
business on the Business Day immediately preceding any date of determination
thereof, to prime banks in New York, New York for the spot purchase in the New
York foreign exchange market of such amount in such currency with U.S. Dollars. 
Any conversion of Dollars into Canadian Dollars will be made by the
Administrative Agent at the then-applicable Spot Rate.

 

1.08         Timing of Performance.  When the performance of any covenant, duty
or obligation is stated to be required on a day that is not a Business Day, the
date for such performance shall extend to the immediately succeeding Business
Day.

 

ARTICLE II
THE COMMITMENTS AND CREDIT EXTENSIONS

 

2.01         The Loans.  (a)  The Term Borrowings.  Subject to the terms and
conditions set forth herein, (i) each Dollar Term Lender severally agrees to
make a single loan (consisting of a Dollar Term Loan pursuant to the Dollar Term
Facility in an amount equal to its Pro Rata Share of the Dollar Term Facility
(each such loan advanced by any Dollar Term Lender

 

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being a “Dollar Term Loan”) and (ii) each Canadian Term Lender severally agrees
to make a single loan (consisting of a Canadian Term Loan pursuant to the
Canadian Term Facility in an amount equal to its Pro Rata Share of the Canadian
Term Facility (each such loan advanced by a Canadian Term Lender being a
“Canadian Term Loan”), in each case, to the Borrower on (i) the Closing Date or
(ii) if such Term Lender has increased its Term Commitment pursuant to Section
2.14, the Increase Effective Date.  Each such Borrowing shall be in U.S. Dollars
or Canadian Dollars, as applicable, and shall consist of Term Loans made
simultaneously by the Term Lenders in accordance with their respective Pro Rata
Share of the Term Facility.  Amounts borrowed under this Section 2.01(a) and
repaid or prepaid may not be reborrowed.  Term Loans may be Base Rate Loans,
Eurodollar Rate Loans or Screen Rate Loans, as applicable, as further provided
herein.

 

(B)           THE REVOLVING CREDIT BORROWINGS.  SUBJECT TO THE TERMS AND
CONDITIONS SET FORTH HEREIN, EACH REVOLVING CREDIT LENDER SEVERALLY AGREES TO
MAKE LOANS (EACH SUCH LOAN, A “REVOLVING CREDIT LOAN”) TO THE BORROWER FROM TIME
TO TIME, ON ANY BUSINESS DAY DURING THE AVAILABILITY PERIOD, IN AN AGGREGATE
AMOUNT NOT TO EXCEED AT ANY TIME OUTSTANDING THE AMOUNT OF SUCH LENDER’S
REVOLVING CREDIT COMMITMENT; PROVIDED, HOWEVER, THAT AFTER GIVING EFFECT TO ANY
REVOLVING CREDIT BORROWING, (I) THE TOTAL OUTSTANDINGS SHALL NOT EXCEED THE
AGGREGATE COMMITMENTS, AND (II) THE AGGREGATE OUTSTANDING AMOUNT OF THE
REVOLVING CREDIT LOANS OF ANY LENDER, PLUS SUCH LENDER’S PRO RATA SHARE OF THE
OUTSTANDING AMOUNT OF ALL L/C OBLIGATIONS, PLUS SUCH LENDER’S PRO RATA SHARE OF
THE OUTSTANDING AMOUNT OF ALL SWING LINE LOANS SHALL NOT EXCEED SUCH LENDER’S
REVOLVING CREDIT COMMITMENT.  WITHIN THE LIMITS OF EACH LENDER’S REVOLVING
CREDIT COMMITMENT, AND SUBJECT TO THE OTHER TERMS AND CONDITIONS HEREOF, THE
BORROWER MAY BORROW UNDER THIS SECTION 2.01(B), PREPAY UNDER SECTION 2.05, AND
REBORROW UNDER THIS SECTION 2.01(B).  REVOLVING CREDIT LOANS MAY BE BASE RATE
LOANS OR EURODOLLAR RATE LOANS, AS FURTHER PROVIDED HEREIN.

 

2.02         Borrowings, Conversions and Continuations of Loans.  (a)  Each Term
Borrowing, each Revolving Credit Borrowing, each conversion of Term Loans or
Revolving Credit Loans from one Type to the other, and each continuation of
Screen Rate Loans or Eurodollar Rate Loans shall be made upon the Borrower’s
irrevocable notice to the Administrative Agent, which may be given by
telephone.  Each such notice must be received by the Administrative Agent not
later than 11:00 a.m. (i) three Business Days prior to the requested date of any
Borrowing of, conversion to or continuation of Screen Rate Loans or Eurodollar
Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Loans, and
(ii) one Business Day before the requested date of any Borrowing of Base Rate
Loans; provided, however, that if the Borrower wishes to request Screen Rate
Loans or Eurodollar Rate Loans having an Interest Period of nine or twelve
months in duration as provided in the definition of “Interest Period”, the
applicable notice must be received by the Administrative Agent not later than
11:00 a.m. four Business Days prior to the requested date of such Borrowing,
conversion or continuation, whereupon the Administrative Agent shall give prompt
notice to the Lenders of such request and determine whether the requested
Interest Period is available.  Not later than 11:00 a.m., three Business Days
before the requested date of such Borrowing, conversion or continuation, the
Administrative Agent shall notify the Borrower (which notice may be by
telephone) whether or not the requested Interest Period has been consented to by
all the Lenders.  Each telephonic notice by the Borrower pursuant to this
Section 2.02(a) must be confirmed promptly by delivery to the Administrative
Agent of a written Committed Loan Notice, appropriately completed and

 

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signed by a Responsible Officer of the Borrower.  Each Borrowing of, conversion
to or continuation of Screen Rate Loans or Eurodollar Rate Loans, as applicable,
shall be in a principal amount of (A) in the case of all Loans other than
Canadian Term Loans, $2,000,000 or a whole multiple of $1,000,000 in excess
thereof and (B) in the case of Canadian Term Loans, CD2,000,000 or a whole
multiple of CD1,000,000 in excess thereof.  Except as provided in Sections
2.03(c) and 2.04(c), each Borrowing of or conversion to Base Rate Loans shall be
in a principal amount of $500,000 or a whole multiple of $100,000 in excess
thereof.  Each Committed Loan Notice  (whether telephonic or written) shall
specify (A) whether the Borrower is requesting a Term Borrowing, a Revolving
Credit Borrowing, a conversion of Term Loans or Revolving Credit Loans from one
Type to the other, or a continuation of Screen Rate Loans or Eurodollar Rate
Loans, (B) the requested date of the Borrowing, conversion or continuation, as
the case may be (which shall be a Business Day), (C) the principal amount of
Loans to be borrowed, converted or continued, (D) the Type of Loans to be
borrowed or to which existing Term Loans or Revolving Credit Loans are to be
converted, and (E) if applicable, the duration of the Interest Period with
respect thereto.  If the Borrower fails to specify a Type of Loan in a Committed
Loan Notice or if the Borrower fails to give a timely notice requesting a
conversion or continuation, then the applicable Term Loans or Revolving Credit
Loans shall be made as, or converted to, Base Rate Loans (except in the case of
Canadian Term Loans, which shall always be Screen Rate Loans, and upon such
failure the Borrower shall be deemed to have specified an Interest Period for
Screen Rate Loans of one month).  Any such automatic conversion to Base Rate
Loans shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurodollar Rate Loans.  If the Borrower
requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans
in any such Committed Loan Notice, but fails to specify an Interest Period, it
will be deemed to have specified an Interest Period of one month.

 

(B)           FOLLOWING RECEIPT OF A COMMITTED LOAN NOTICE, THE ADMINISTRATIVE
AGENT SHALL PROMPTLY NOTIFY EACH LENDER OF THE AMOUNT OF ITS PRO RATA SHARE OF
THE APPLICABLE TERM LOANS OR REVOLVING CREDIT LOANS, AND IF NO TIMELY NOTICE OF
A CONVERSION OR CONTINUATION IS PROVIDED BY THE BORROWER, THE ADMINISTRATIVE
AGENT SHALL NOTIFY EACH LENDER OF THE DETAILS OF ANY AUTOMATIC CONVERSION TO
BASE RATE LOANS DESCRIBED IN SECTION 2.02(A).  IN THE CASE OF A TERM LOAN
BORROWING OR A REVOLVING CREDIT BORROWING, EACH APPROPRIATE LENDER SHALL MAKE
THE AMOUNT OF ITS LOAN AVAILABLE TO THE ADMINISTRATIVE AGENT IN IMMEDIATELY
AVAILABLE FUNDS AT THE ADMINISTRATIVE AGENT’S OFFICE NOT LATER THAN 1:00 P.M. ON
THE BUSINESS DAY SPECIFIED IN THE APPLICABLE COMMITTED LOAN NOTICE.  UPON
SATISFACTION OF THE APPLICABLE CONDITIONS SET FORTH IN SECTION 4.02 (AND, IF
SUCH BORROWING IS THE INITIAL CREDIT EXTENSION, SECTION 4.01), THE
ADMINISTRATIVE AGENT SHALL MAKE ALL FUNDS SO RECEIVED AVAILABLE TO THE BORROWER
IN LIKE FUNDS AS RECEIVED BY THE ADMINISTRATIVE AGENT EITHER BY (I) CREDITING
THE ACCOUNT OF THE BORROWER ON THE BOOKS OF BANK OF AMERICA WITH THE AMOUNT OF
SUCH FUNDS OR (II) WIRE TRANSFER OF SUCH FUNDS, IN EACH CASE IN ACCORDANCE WITH
INSTRUCTIONS PROVIDED TO (AND REASONABLY ACCEPTABLE TO) THE ADMINISTRATIVE AGENT
BY THE BORROWER; PROVIDED, HOWEVER, THAT IF, ON THE DATE THE COMMITTED LOAN
NOTICE  WITH RESPECT TO SUCH BORROWING IS GIVEN BY THE BORROWER, THERE ARE L/C
BORROWINGS OUTSTANDING, THEN THE PROCEEDS OF SUCH BORROWING FIRST SHALL BE
APPLIED TO THE PAYMENT IN FULL OF ANY SUCH L/C BORROWINGS.

 

(C)           EXCEPT AS OTHERWISE PROVIDED HEREIN, A SCREEN RATE LOAN OR
EURODOLLAR RATE LOAN MAY BE CONTINUED OR CONVERTED, AS APPLICABLE, ONLY ON THE
LAST DAY OF AN INTEREST PERIOD FOR SUCH LOAN UNLESS THE BORROWER PAYS THE AMOUNT
DUE UNDER SECTION 3.05 IN CONNECTION

 

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THEREWITH.  DURING THE EXISTENCE OF AN EVENT OF DEFAULT, NO LOANS MAY BE
REQUESTED AS, CONVERTED TO OR CONTINUED AS EURODOLLAR RATE LOANS WITHOUT THE
CONSENT OF THE REQUIRED LENDERS.

 

(D)           THE ADMINISTRATIVE AGENT SHALL PROMPTLY NOTIFY THE BORROWER AND
THE LENDERS OF THE INTEREST RATE APPLICABLE TO ANY INTEREST PERIOD FOR SCREEN
RATE LOANS OR EURODOLLAR RATE LOANS UPON DETERMINATION OF SUCH INTEREST RATE. 
THE DETERMINATION OF THE SCREEN RATE AND THE EURODOLLAR RATE BY THE
ADMINISTRATIVE AGENT SHALL BE CONCLUSIVE IN THE ABSENCE OF MANIFEST ERROR.  AT
ANY TIME THAT BASE RATE LOANS ARE OUTSTANDING, THE ADMINISTRATIVE AGENT SHALL
NOTIFY THE BORROWER AND THE LENDERS OF ANY CHANGE IN BANK OF AMERICA’S PRIME
RATE USED IN DETERMINING THE BASE RATE PROMPTLY FOLLOWING THE PUBLIC
ANNOUNCEMENT OF SUCH CHANGE.

 

(E)           AFTER GIVING EFFECT TO ALL TERM BORROWINGS, ALL REVOLVING CREDIT
BORROWINGS, ALL CONVERSIONS OF TERM LOANS OR REVOLVING CREDIT LOANS FROM ONE
TYPE TO THE OTHER, AND ALL CONTINUATIONS OF TERM LOANS OR REVOLVING CREDIT LOANS
AS THE SAME TYPE, THERE SHALL NOT BE MORE THAN FIFTEEN INTEREST PERIODS IN
EFFECT.

 

(F)            THE FAILURE OF ANY LENDER TO MAKE THE LOAN TO BE MADE BY IT AS
PART OF ANY BORROWING SHALL NOT RELIEVE ANY OTHER LENDER OF ITS OBLIGATION, IF
ANY, HEREUNDER TO MAKE ITS LOAN ON THE DATE OF SUCH BORROWING, BUT NO LENDER
SHALL BE RESPONSIBLE FOR THE FAILURE OF ANY OTHER LENDER TO MAKE THE LOAN TO BE
MADE BY SUCH OTHER LENDER ON THE DATE OF ANY BORROWING.

 

(G)           FOR THE AVOIDANCE OF DOUBT, NOTHING IN THIS SECTION 2.02 IS
INTENDED TO RESULT IN, OR PERMIT, ANY REDENOMINATION OF ANY CANADIAN TERM LOAN
INTO A DOLLAR TERM LOAN OR OF ANY DOLLAR TERM LOAN INTO A CANADIAN TERM LOAN.

 

2.03         Letters of Credit.  (a)  The Letter of Credit Commitment.  (i) 
Subject to the terms and conditions set forth herein, (A) the L/C Issuer agrees,
in reliance upon the agreements of the other Revolving Credit Lenders set forth
in this Section 2.03, (1) from time to time on any Business Day during the
period from the Closing Date until the Letter of Credit Expiration Date, to
issue Letters of Credit for the account of the Borrower, and to amend or extend
Letters of Credit previously issued by it, in accordance with Section 2.03(b),
and (2) to honor drawings under the Letters of Credit; and (B) the Revolving
Credit Lenders severally agree to participate in Letters of Credit issued for
the account of the Borrower and any drawings thereunder (including Sight Drafts,
Acceptances and Deferred Payment Obligations); provided that after giving effect
to any L/C Credit Extension with respect to any Letter of Credit, (x) the Total
Outstandings shall not exceed the Aggregate Commitments, (y) the aggregate
Outstanding Amount of the Revolving Credit Loans of any Lender, plus such
Lender’s Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus
such Lender’s Pro Rata Share of the Outstanding Amount of all Swing Line Loans
shall not exceed such Lender’s Revolving Credit Commitment, and (z) the
Outstanding Amount of the L/C Obligations shall not exceed the Letter of Credit
Sublimit.  Each request by the Borrower for the issuance or amendment of a
Letter of Credit shall be deemed to be a representation by the Borrower that the
L/C Credit Extension so requested complies with the conditions set forth in the
proviso to the preceding sentence.  Within the foregoing limits, and subject to
the terms and conditions hereof, the Borrower’s ability to obtain Letters of
Credit shall be fully revolving, and accordingly the Borrower may, during the
foregoing period, obtain Letters of Credit to replace Letters of Credit that
have expired or that have been drawn upon and reimbursed.  All Existing Letters
of Credit shall be deemed to have

 

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been issued pursuant hereto, and from and after the Closing Date shall be
subject to and governed by the terms and conditions hereof.

 

(II)           THE L/C ISSUER SHALL NOT ISSUE ANY LETTER OF CREDIT IF:

 

(A)          Subject to Section 2.03(b)(iii), the expiry date of such requested
Letter of Credit would occur more than twelve months after the date of issuance
or last extension, unless the Required Lenders have approved such expiry date;
or

 

(B)           the expiry date of such requested Letter of Credit would occur
after the Letter of Credit Expiration Date, unless all the Revolving Credit
Lenders (other than Defaulting Lenders) have approved such expiry date.

 

(III)          THE L/C ISSUER SHALL NOT BE UNDER ANY OBLIGATION TO ISSUE ANY
LETTER OF CREDIT IF:

 

(A)          any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain the L/C Issuer from
issuing such Letter of Credit, or any Law applicable to the L/C Issuer or any
request or directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over the L/C Issuer shall prohibit, or
request that the L/C Issuer refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose upon the L/C
Issuer with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which the L/C Issuer is not otherwise compensated hereunder)
not in effect on the Closing Date, or shall impose upon the L/C Issuer any
unreimbursed loss, cost or expense which was not applicable on the Closing Date
and which, in each case, the L/C Issuer in good faith deems material to it;

 

(B)           the issuance of such Letter of Credit would violate any Laws
applicable to the L/C Issuer or one or more policies of the L/C Issuer; or

 

(C)           except as otherwise agreed by the Administrative Agent and the L/C
Issuer, such Letter of Credit is in an initial face amount less than $50,000, in
the case of a commercial Letter of Credit, or $50,000, in the case of a standby
Letter of Credit, or is to be denominated in a currency other than Dollars or
has provisions that permit the stated face amount of such Letter of Credit to be
increased; or

 

(IV)          THE L/C ISSUER SHALL BE UNDER NO OBLIGATION TO AMEND ANY LETTER OF
CREDIT IF (A) THE L/C ISSUER WOULD HAVE NO OBLIGATION AT SUCH TIME TO ISSUE SUCH
LETTER OF CREDIT IN ITS AMENDED FORM UNDER THE TERMS HEREOF, OR (B) THE
BENEFICIARY OF SUCH LETTER OF CREDIT DOES NOT ACCEPT THE PROPOSED AMENDMENT TO
SUCH LETTER OF CREDIT.

 

(B)           PROCEDURES FOR ISSUANCE AND AMENDMENT OF LETTERS OF CREDIT;
AUTO-EXTENSION LETTERS OF CREDIT.  (I)  EACH LETTER OF CREDIT SHALL BE ISSUED OR
AMENDED, AS THE CASE MAY BE, UPON THE REQUEST OF THE BORROWER DELIVERED TO THE
L/C ISSUER (WITH A COPY TO THE ADMINISTRATIVE AGENT) IN THE FORM OF A LETTER OF
CREDIT APPLICATION, APPROPRIATELY COMPLETED AND SIGNED BY A RESPONSIBLE OFFICER
OF THE BORROWER.  SUCH LETTER OF CREDIT APPLICATION MUST BE RECEIVED BY THE L/C
ISSUER AND THE ADMINISTRATIVE AGENT NOT LATER THAN 1:00 P.M. AT LEAST TWO

 

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BUSINESS DAYS (OR SUCH LATER DATE AND TIME AS THE ADMINISTRATIVE AGENT AND THE
L/C ISSUER MAY AGREE IN A PARTICULAR INSTANCE IN THEIR SOLE DISCRETION) PRIOR TO
THE PROPOSED ISSUANCE DATE OR DATE OF AMENDMENT, AS THE CASE MAY BE.  IN THE
CASE OF A REQUEST FOR AN INITIAL ISSUANCE OF A LETTER OF CREDIT, SUCH LETTER OF
CREDIT APPLICATION SHALL SPECIFY IN FORM AND DETAIL REASONABLY SATISFACTORY TO
THE L/C ISSUER:  (A) THE PROPOSED ISSUANCE DATE OF THE REQUESTED LETTER OF
CREDIT (WHICH SHALL BE A BUSINESS DAY); (B) THE AMOUNT THEREOF; (C) THE EXPIRY
DATE THEREOF; (D) THE NAME AND ADDRESS OF THE BENEFICIARY THEREOF; (E) THE
DOCUMENTS TO BE PRESENTED BY SUCH BENEFICIARY IN CASE OF ANY DRAWING THEREUNDER;
(F) THE FULL TEXT OF ANY CERTIFICATE TO BE PRESENTED BY SUCH BENEFICIARY IN CASE
OF ANY DRAWING THEREUNDER; AND (G) SUCH OTHER MATTERS AS THE L/C ISSUER MAY
REASONABLY REQUIRE.  IN THE CASE OF A REQUEST FOR AN AMENDMENT OF ANY
OUTSTANDING LETTER OF CREDIT, SUCH LETTER OF CREDIT APPLICATION SHALL SPECIFY IN
FORM AND DETAIL REASONABLY SATISFACTORY TO THE L/C ISSUER (A) THE LETTER OF
CREDIT TO BE AMENDED; (B) THE PROPOSED DATE OF AMENDMENT THEREOF (WHICH SHALL BE
A BUSINESS DAY); (C) THE NATURE OF THE PROPOSED AMENDMENT; AND (D) SUCH OTHER
MATTERS AS THE L/C ISSUER MAY REASONABLY REQUIRE.  ADDITIONALLY, THE BORROWER
SHALL FURNISH TO THE L/C ISSUER AND THE ADMINISTRATIVE AGENT SUCH OTHER
DOCUMENTS AND INFORMATION PERTAINING TO SUCH REQUESTED LETTER OF CREDIT ISSUANCE
OR AMENDMENT, INCLUDING ANY ISSUER DOCUMENTS, AS THE L/C ISSUER OR THE
ADMINISTRATIVE AGENT MAY REQUIRE.

 

(II)           PROMPTLY AFTER RECEIPT OF ANY LETTER OF CREDIT APPLICATION, THE
L/C ISSUER WILL CONFIRM WITH THE ADMINISTRATIVE AGENT (BY TELEPHONE OR IN
WRITING) THAT THE ADMINISTRATIVE AGENT HAS RECEIVED A COPY OF SUCH LETTER OF
CREDIT APPLICATION FROM THE BORROWER AND, IF NOT, THE L/C ISSUER WILL PROVIDE
THE ADMINISTRATIVE AGENT WITH A COPY THEREOF.  UNLESS THE L/C ISSUER HAS
RECEIVED WRITTEN NOTICE FROM ANY LENDER, THE ADMINISTRATIVE AGENT OR ANY LOAN
PARTY, AT LEAST ONE BUSINESS DAY PRIOR TO THE REQUESTED DATE OF ISSUANCE OR
AMENDMENT OF THE APPLICABLE LETTER OF CREDIT, THAT ONE OR MORE APPLICABLE
CONDITIONS CONTAINED IN ARTICLE IV SHALL NOT THEN BE SATISFIED, THEN, SUBJECT TO
THE TERMS AND CONDITIONS HEREOF, THE L/C ISSUER SHALL, ON THE REQUESTED DATE,
ISSUE A LETTER OF CREDIT FOR THE ACCOUNT OF THE BORROWER OR ENTER INTO THE
APPLICABLE AMENDMENT, AS THE CASE MAY BE.  IMMEDIATELY UPON THE ISSUANCE OF EACH
LETTER OF CREDIT, EACH REVOLVING CREDIT LENDER SHALL BE DEEMED TO, AND HEREBY
IRREVOCABLY AND UNCONDITIONALLY AGREES TO, PURCHASE FROM THE L/C ISSUER A RISK
PARTICIPATION IN SUCH LETTER OF CREDIT IN AN AMOUNT EQUAL TO THE PRODUCT OF SUCH
LENDER’S PRO RATA SHARE TIMES THE AMOUNT OF SUCH LETTER OF CREDIT.

 

(III)          IF THE BORROWER SO REQUESTS IN ANY APPLICABLE LETTER OF CREDIT
APPLICATION, THE L/C ISSUER MAY, IN ITS SOLE AND ABSOLUTE DISCRETION, AGREE TO
ISSUE A LETTER OF CREDIT THAT HAS AUTOMATIC EXTENSION PROVISIONS (EACH, AN
“AUTO-EXTENSION LETTER OF CREDIT”); PROVIDED THAT ANY SUCH AUTO-EXTENSION LETTER
OF CREDIT MUST PERMIT THE L/C ISSUER TO PREVENT ANY SUCH RENEWAL AT LEAST ONCE
IN EACH TWELVE-MONTH PERIOD (COMMENCING WITH THE DATE OF ISSUANCE OF SUCH LETTER
OF CREDIT) BY GIVING PRIOR NOTICE TO THE BENEFICIARY THEREOF NOT LATER THAN A
DAY (THE “NONEXTENSION NOTICE DATE”) IN EACH SUCH TWELVE-MONTH PERIOD TO BE
AGREED UPON AT THE TIME SUCH LETTER OF CREDIT IS ISSUED.  UNLESS OTHERWISE
DIRECTED BY THE L/C ISSUER, THE BORROWER SHALL NOT BE REQUIRED TO MAKE A
SPECIFIC REQUEST TO THE L/C ISSUER FOR ANY SUCH EXTENSION.  ONCE AN
AUTO-EXTENSION LETTER OF CREDIT HAS BEEN ISSUED, THE LENDERS SHALL BE DEEMED TO
HAVE AUTHORIZED (BUT MAY NOT REQUIRE) THE L/C ISSUER TO PERMIT THE EXTENSION OF
SUCH LETTER OF CREDIT AT ANY TIME TO AN EXPIRY DATE NOT LATER THAN THE LETTER OF
CREDIT EXPIRATION DATE; PROVIDED, HOWEVER, THAT THE L/C ISSUER SHALL NOT PERMIT
ANY SUCH EXTENSION IF (A) THE L/C ISSUER HAS DETERMINED THAT IT WOULD NOT BE
PERMITTED, OR WOULD HAVE NO OBLIGATION AT SUCH TIME TO ISSUE SUCH LETTER OF
CREDIT IN ITS REVISED FORM UNDER THE TERMS HEREOF (BY REASON OF THE PROVISIONS
OF SECTION 2.03(A)(II) OR OTHERWISE), OR

 

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(B) IT HAS RECEIVED NOTICE (WHICH MAY BE BY TELEPHONE OR IN WRITING) ON OR
BEFORE THE DAY THAT IS FIVE BUSINESS DAYS BEFORE THE NONEXTENSION NOTICE DATE
(1) FROM THE ADMINISTRATIVE AGENT THAT THE REQUIRED LENDERS HAVE ELECTED NOT TO
PERMIT SUCH EXTENSION, (2) FROM THE ADMINISTRATIVE AGENT, ANY REVOLVING CREDIT
LENDER OR ANY LOAN PARTY THAT ONE OR MORE OF THE APPLICABLE CONDITIONS SPECIFIED
IN SECTION 4.02 IS NOT THEN SATISFIED, AND IN EACH SUCH CASE DIRECTING THE L/C
ISSUER NOT TO PERMIT SUCH EXTENSION OR (3) FROM THE BORROWER DIRECTING THE L/C
ISSUER NOT TO PERMIT SUCH EXTENSION.

 

(IV)          PROMPTLY AFTER ITS DELIVERY OF ANY LETTER OF CREDIT OR ANY
AMENDMENT TO A LETTER OF CREDIT TO AN ADVISING BANK WITH RESPECT THERETO OR TO
THE BENEFICIARY THEREOF, THE L/C ISSUER WILL ALSO DELIVER TO THE BORROWER AND
THE ADMINISTRATIVE AGENT A TRUE AND COMPLETE COPY OF SUCH LETTER OF CREDIT OR
AMENDMENT.

 

(C)           DRAWINGS AND REIMBURSEMENTS; FUNDING OF PARTICIPATIONS.  (I)  UPON
RECEIPT FROM THE BENEFICIARY OF ANY LETTER OF CREDIT OF ANY NOTICE OF A DRAWING
UNDER SUCH LETTER OF CREDIT, THE L/C ISSUER SHALL NOTIFY THE BORROWER AND THE
ADMINISTRATIVE AGENT THEREOF.  IF THE L/C ISSUER NOTIFIES THE BORROWER OF SUCH
PAYMENT PRIOR TO 1:00 P.M. ON THE DATE OF ANY PAYMENT BY THE L/C ISSUER UNDER A
LETTER OF CREDIT (EACH SUCH DATE, AN “HONOR DATE”), THE BORROWER SHALL REIMBURSE
THE L/C ISSUER THROUGH THE ADMINISTRATIVE AGENT IN AN AMOUNT EQUAL TO THE AMOUNT
OF SUCH DRAWING; PROVIDED, THAT IF SUCH NOTICE IS NOT PROVIDED TO THE BORROWER
PRIOR TO 1:00 P.M. ON THE HONOR DATE, THEN THE BORROWER SHALL REIMBURSE THE L/C
ISSUER THROUGH THE ADMINISTRATIVE AGENT IN AN AMOUNT EQUAL TO THE AMOUNT OF SUCH
DRAWING ON THE NEXT SUCCEEDING BUSINESS DAY AND SUCH EXTENSION OF TIME SHALL BE
REFLECTED IN COMPUTING FEES IN RESPECT OF ANY SUCH LETTER OF CREDIT.  IF THE
BORROWER FAILS TO SO REIMBURSE THE L/C ISSUER BY SUCH TIME, THE ADMINISTRATIVE
AGENT SHALL PROMPTLY NOTIFY EACH REVOLVING CREDIT LENDER OF THE HONOR DATE, THE
AMOUNT OF THE UNREIMBURSED DRAWING (THE “UNREIMBURSED AMOUNT”), AND THE AMOUNT
OF SUCH REVOLVING CREDIT LENDER’S PRO RATA SHARE THEREOF.  IN SUCH EVENT, THE
BORROWER SHALL BE DEEMED TO HAVE REQUESTED A REVOLVING CREDIT BORROWING OF BASE
RATE LOANS TO BE DISBURSED ON THE HONOR DATE IN AN AMOUNT EQUAL TO THE
UNREIMBURSED AMOUNT, WITHOUT REGARD TO THE MINIMUM AND MULTIPLES SPECIFIED IN
SECTION 2.02 FOR THE PRINCIPAL AMOUNT OF BASE RATE LOANS, BUT SUBJECT TO THE
AMOUNT OF THE UNUTILIZED PORTION OF THE REVOLVING CREDIT COMMITMENTS AND THE
CONDITIONS SET FORTH IN SECTION 4.02 (OTHER THAN THE DELIVERY OF A COMMITTED
LOAN NOTICE).  ANY NOTICE GIVEN BY THE L/C ISSUER OR THE ADMINISTRATIVE AGENT
PURSUANT TO THIS SECTION 2.03(C)(I) MAY BE GIVEN BY TELEPHONE IF IMMEDIATELY
CONFIRMED IN WRITING; PROVIDED THAT THE LACK OF SUCH AN IMMEDIATE CONFIRMATION
SHALL NOT AFFECT THE CONCLUSIVENESS OR BINDING EFFECT OF SUCH NOTICE.

 

(II)           EACH REVOLVING CREDIT LENDER (INCLUDING THE LENDER ACTING AS L/C
ISSUER) SHALL UPON ANY NOTICE PURSUANT TO SECTION 2.03(C)(I) MAKE FUNDS
AVAILABLE TO THE ADMINISTRATIVE AGENT FOR THE ACCOUNT OF THE L/C ISSUER AT THE
ADMINISTRATIVE AGENT’S OFFICE IN AN AMOUNT EQUAL TO ITS PRO RATA SHARE OF THE
UNREIMBURSED AMOUNT NOT LATER THAN 1:00 P.M. ON THE BUSINESS DAY SPECIFIED IN
SUCH NOTICE BY THE ADMINISTRATIVE AGENT, WHEREUPON, SUBJECT TO THE PROVISIONS OF
SECTION 2.03(C)(III), EACH REVOLVING CREDIT LENDER THAT SO MAKES FUNDS AVAILABLE
SHALL BE DEEMED TO HAVE MADE A BASE RATE LOAN TO THE BORROWER IN SUCH AMOUNT. 
THE ADMINISTRATIVE AGENT SHALL REMIT THE FUNDS SO RECEIVED TO THE L/C ISSUER.

 

(III)          WITH RESPECT TO ANY UNREIMBURSED AMOUNT THAT IS NOT FULLY
REFINANCED BY A REVOLVING CREDIT BORROWING OF BASE RATE LOANS BECAUSE THE
CONDITIONS SET FORTH IN SECTION 4.02

 

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CANNOT BE SATISFIED OR FOR ANY OTHER REASON, THE BORROWER SHALL BE DEEMED TO
HAVE INCURRED FROM THE L/C ISSUER AN L/C BORROWING IN THE AMOUNT OF THE
UNREIMBURSED AMOUNT THAT IS NOT SO REFINANCED, WHICH L/C BORROWING SHALL BE DUE
AND PAYABLE ON DEMAND (TOGETHER WITH INTEREST) AND SHALL BEAR INTEREST AT THE
DEFAULT RATE.  IN SUCH EVENT, EACH REVOLVING CREDIT LENDER’S PAYMENT TO THE
ADMINISTRATIVE AGENT FOR THE ACCOUNT OF THE L/C ISSUER PURSUANT TO SECTION
2.03(C)(II) SHALL BE DEEMED PAYMENT IN RESPECT OF ITS PARTICIPATION IN SUCH L/C
BORROWING AND SHALL CONSTITUTE AN L/C ADVANCE FROM SUCH LENDER IN SATISFACTION
OF ITS PARTICIPATION OBLIGATION UNDER THIS SECTION 2.03.

 

(IV)          UNTIL EACH REVOLVING CREDIT LENDER FUNDS ITS REVOLVING CREDIT LOAN
OR L/C ADVANCE PURSUANT TO THIS SECTION 2.03(C) TO REIMBURSE THE L/C ISSUER FOR
ANY AMOUNT DRAWN UNDER ANY LETTER OF CREDIT, INTEREST IN RESPECT OF SUCH
LENDER’S PRO RATA SHARE OF SUCH AMOUNT SHALL BE SOLELY FOR THE ACCOUNT OF THE
L/C ISSUER.

 

(V)           EACH REVOLVING CREDIT LENDER’S OBLIGATION TO MAKE REVOLVING CREDIT
LOANS OR L/C ADVANCES TO REIMBURSE THE L/C ISSUER FOR AMOUNTS DRAWN UNDER
LETTERS OF CREDIT, AS CONTEMPLATED BY THIS SECTION 2.03(C), SHALL BE ABSOLUTE
AND UNCONDITIONAL AND SHALL NOT BE AFFECTED BY ANY CIRCUMSTANCE, INCLUDING (A)
ANY SETOFF, COUNTERCLAIM, RECOUPMENT, DEFENSE OR OTHER RIGHT WHICH SUCH LENDER
MAY HAVE AGAINST THE L/C ISSUER, THE BORROWER OR ANY OTHER PERSON FOR ANY REASON
WHATSOEVER; (B) THE OCCURRENCE OR CONTINUANCE OF A DEFAULT, OR (C) ANY OTHER
OCCURRENCE, EVENT OR CONDITION, WHETHER OR NOT SIMILAR TO ANY OF THE FOREGOING;
PROVIDED, HOWEVER, THAT EACH REVOLVING CREDIT LENDER’S OBLIGATION TO MAKE
REVOLVING CREDIT LOANS PURSUANT TO THIS SECTION 2.03(C) IS SUBJECT TO THE
CONDITIONS SET FORTH IN SECTION 4.02 (OTHER THAN DELIVERY BY THE BORROWER OF A
COMMITTED LOAN NOTICE ).  NO SUCH MAKING OF AN L/C ADVANCE SHALL RELIEVE OR
OTHERWISE IMPAIR THE OBLIGATION OF THE BORROWER TO REIMBURSE THE L/C ISSUER FOR
THE AMOUNT OF ANY PAYMENT MADE BY THE L/C ISSUER UNDER ANY LETTER OF CREDIT,
TOGETHER WITH INTEREST AS PROVIDED HEREIN.

 

(VI)          IF ANY REVOLVING CREDIT LENDER FAILS TO MAKE AVAILABLE TO THE
ADMINISTRATIVE AGENT FOR THE ACCOUNT OF THE L/C ISSUER ANY AMOUNT REQUIRED TO BE
PAID BY SUCH LENDER PURSUANT TO THE FOREGOING PROVISIONS OF THIS SECTION 2.03(C)
BY THE TIME SPECIFIED IN SECTION 2.03(C)(II), THE L/C ISSUER SHALL BE ENTITLED
TO RECOVER FROM SUCH LENDER (ACTING THROUGH THE ADMINISTRATIVE AGENT), ON
DEMAND, SUCH AMOUNT WITH INTEREST THEREON FOR THE PERIOD FROM THE DATE SUCH
PAYMENT IS REQUIRED TO THE DATE ON WHICH SUCH PAYMENT IS IMMEDIATELY AVAILABLE
TO THE L/C ISSUER AT A RATE PER ANNUM EQUAL TO THE FEDERAL FUNDS RATE FROM TIME
TO TIME IN EFFECT.  A CERTIFICATE OF THE L/C ISSUER SUBMITTED TO ANY REVOLVING
CREDIT LENDER (THROUGH THE ADMINISTRATIVE AGENT) WITH RESPECT TO ANY AMOUNTS
OWING UNDER THIS SECTION 2.03(C)(VI) SHALL BE CONCLUSIVE ABSENT MANIFEST ERROR.

 

(D)           REPAYMENT OF PARTICIPATIONS.  (I)  AT ANY TIME AFTER THE L/C
ISSUER HAS MADE A PAYMENT UNDER ANY LETTER OF CREDIT AND HAS RECEIVED FROM ANY
REVOLVING CREDIT LENDER SUCH LENDER’S L/C ADVANCE IN RESPECT OF SUCH PAYMENT IN
ACCORDANCE WITH SECTION 2.03(C), IF THE ADMINISTRATIVE AGENT RECEIVES FOR THE
ACCOUNT OF THE L/C ISSUER ANY PAYMENT IN RESPECT OF THE RELATED UNREIMBURSED
AMOUNT OR INTEREST THEREON (WHETHER DIRECTLY FROM THE BORROWER OR OTHERWISE,
INCLUDING PROCEEDS OF CASH COLLATERAL APPLIED THERETO BY THE ADMINISTRATIVE
AGENT), THE ADMINISTRATIVE AGENT WILL DISTRIBUTE TO SUCH LENDER ITS PRO RATA
SHARE THEREOF (APPROPRIATELY ADJUSTED, IN THE CASE OF INTEREST PAYMENTS, TO
REFLECT THE PERIOD OF TIME DURING WHICH SUCH

 

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LENDER’S L/C ADVANCE WAS OUTSTANDING) IN THE SAME FUNDS AS THOSE RECEIVED BY THE
ADMINISTRATIVE AGENT.

 

(II)           IF ANY PAYMENT RECEIVED BY THE ADMINISTRATIVE AGENT FOR THE
ACCOUNT OF THE L/C ISSUER PURSUANT TO SECTION 2.03(C)(I) IS REQUIRED TO BE
RETURNED UNDER ANY OF THE CIRCUMSTANCES DESCRIBED IN SECTION 10.06 (INCLUDING
PURSUANT TO ANY SETTLEMENT ENTERED INTO BY THE L/C ISSUER IN ITS DISCRETION),
EACH REVOLVING CREDIT LENDER SHALL PAY TO THE ADMINISTRATIVE AGENT FOR THE
ACCOUNT OF THE L/C ISSUER ITS PRO RATA SHARE THEREOF ON DEMAND OF THE
ADMINISTRATIVE AGENT, PLUS INTEREST THEREON FROM THE DATE OF SUCH DEMAND TO THE
DATE SUCH AMOUNT IS RETURNED BY SUCH LENDER, AT A RATE PER ANNUM EQUAL TO THE
FEDERAL FUNDS RATE FROM TIME TO TIME IN EFFECT.

 

(E)           OBLIGATIONS ABSOLUTE.  THE OBLIGATION OF THE BORROWER TO REIMBURSE
THE L/C ISSUER FOR EACH DRAWING UNDER EACH LETTER OF CREDIT AND TO REPAY EACH
L/C BORROWING SHALL BE ABSOLUTE, UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE
PAID STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT UNDER ALL
CIRCUMSTANCES, INCLUDING THE FOLLOWING:

 

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

 

(II)           THE EXISTENCE OF ANY CLAIM, COUNTERCLAIM, SETOFF, DEFENSE OR
OTHER RIGHT THAT THE BORROWER MAY HAVE AT ANY TIME AGAINST ANY BENEFICIARY OR
ANY TRANSFEREE OF SUCH LETTER OF CREDIT (OR ANY PERSON FOR WHOM ANY SUCH
BENEFICIARY OR ANY SUCH TRANSFEREE MAY BE ACTING), THE L/C ISSUER OR ANY OTHER
PERSON, WHETHER IN CONNECTION WITH THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED
HEREBY OR BY SUCH LETTER OF CREDIT OR ANY AGREEMENT OR INSTRUMENT RELATING
THERETO, OR ANY UNRELATED TRANSACTION;

 

(III)          ANY DRAFT, DEMAND, CERTIFICATE OR OTHER DOCUMENT PRESENTED UNDER
SUCH LETTER OF CREDIT PROVING TO BE FORGED, FRAUDULENT, INVALID OR INSUFFICIENT
IN ANY RESPECT OR ANY STATEMENT THEREIN BEING UNTRUE OR INACCURATE IN ANY
RESPECT; OR ANY LOSS OR DELAY IN THE TRANSMISSION OR OTHERWISE OF ANY DOCUMENT
REQUIRED IN ORDER TO MAKE A DRAWING UNDER SUCH LETTER OF CREDIT;

 

(IV)          ANY PAYMENT BY THE L/C ISSUER UNDER SUCH LETTER OF CREDIT AGAINST
PRESENTATION OF A DRAFT OR CERTIFICATE THAT DOES NOT STRICTLY COMPLY WITH THE
TERMS OF SUCH LETTER OF CREDIT; OR ANY PAYMENT MADE BY THE L/C ISSUER UNDER SUCH
LETTER OF CREDIT TO ANY PERSON PURPORTING TO BE A TRUSTEE IN BANKRUPTCY,
DEBTOR-IN-POSSESSION, ASSIGNEE FOR THE BENEFIT OF CREDITORS, LIQUIDATOR,
RECEIVER OR OTHER REPRESENTATIVE OF OR SUCCESSOR TO ANY BENEFICIARY OR ANY
TRANSFEREE OF SUCH LETTER OF CREDIT, INCLUDING ANY ARISING IN CONNECTION WITH
ANY PROCEEDING UNDER ANY DEBTOR RELIEF LAW;

 

(V)           ANY EXCHANGE, RELEASE OR NONPERFECTION OF ANY COLLATERAL, OR ANY
RELEASE OR AMENDMENT OR WAIVER OF OR CONSENT TO DEPARTURE FROM THE GUARANTY OR
ANY OTHER GUARANTEE, FOR ALL OR ANY OF THE OBLIGATIONS OF THE BORROWER IN
RESPECT OF SUCH LETTER OF CREDIT; OR

 

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(VI)          ANY OTHER CIRCUMSTANCE OR HAPPENING WHATSOEVER, WHETHER OR NOT
SIMILAR TO ANY OF THE FOREGOING, INCLUDING ANY OTHER CIRCUMSTANCE THAT MIGHT
OTHERWISE CONSTITUTE A DEFENSE AVAILABLE TO, OR A DISCHARGE OF, THE BORROWER.

 

The Borrower shall promptly examine a copy of each Letter of Credit and each
amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower’s instructions or other irregularity, the
Borrower will promptly notify the L/C Issuer.  The Borrower shall be
conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.

 

(F)            ROLE OF L/C ISSUER.  EACH LENDER AND THE BORROWER AGREE THAT, IN
PAYING ANY DRAWING UNDER A LETTER OF CREDIT, THE L/C ISSUER SHALL NOT HAVE ANY
RESPONSIBILITY TO OBTAIN ANY DOCUMENT (OTHER THAN ANY SIGHT DRAFT, CERTIFICATES
AND DOCUMENTS EXPRESSLY REQUIRED BY THE LETTER OF CREDIT) OR TO ASCERTAIN OR
INQUIRE AS TO THE VALIDITY OR ACCURACY OF ANY SUCH DOCUMENT OR THE AUTHORITY OF
THE PERSON EXECUTING OR DELIVERING ANY SUCH DOCUMENT.  NONE OF THE L/C ISSUER,
ANY AGENT-RELATED PERSON NOR ANY OF THE RESPECTIVE CORRESPONDENTS, PARTICIPANTS
OR ASSIGNEES OF THE L/C ISSUER SHALL BE LIABLE TO ANY LENDER FOR (I) ANY ACTION
TAKEN OR OMITTED IN CONNECTION HEREWITH AT THE REQUEST OR WITH THE APPROVAL OF
THE LENDERS OR THE REQUIRED LENDERS, AS APPLICABLE; (II) ANY ACTION TAKEN OR
OMITTED IN THE ABSENCE OF GROSS NEGLIGENCE OR WILLFUL MISCONDUCT; OR (III) THE
DUE EXECUTION, EFFECTIVENESS, VALIDITY OR ENFORCEABILITY OF ANY DOCUMENT OR
INSTRUMENT RELATED TO ANY LETTER OF CREDIT OR LETTER OF CREDIT APPLICATION.  THE
BORROWER HEREBY ASSUMES ALL RISKS OF THE ACTS OR OMISSIONS OF ANY BENEFICIARY OR
TRANSFEREE WITH RESPECT TO ITS USE OF ANY LETTER OF CREDIT; PROVIDED, HOWEVER,
THAT THIS ASSUMPTION IS NOT INTENDED TO, AND SHALL NOT, PRECLUDE THE BORROWER’S
PURSUING SUCH RIGHTS AND REMEDIES AS IT MAY HAVE AGAINST THE BENEFICIARY OR
TRANSFEREE AT LAW OR UNDER ANY OTHER AGREEMENT.  NONE OF THE L/C ISSUER, ANY
AGENT-RELATED PERSON, NOR ANY OF THE RESPECTIVE CORRESPONDENTS, PARTICIPANTS OR
ASSIGNEES OF THE L/C ISSUER, SHALL BE LIABLE OR RESPONSIBLE FOR ANY OF THE
MATTERS DESCRIBED IN CLAUSES (I) THROUGH (V) OF SECTION 2.03(E); PROVIDED,
HOWEVER, THAT ANYTHING IN SUCH CLAUSES TO THE CONTRARY NOTWITHSTANDING, THE
BORROWER MAY HAVE A CLAIM AGAINST THE L/C ISSUER, AND THE L/C ISSUER MAY BE
LIABLE TO THE BORROWER, TO THE EXTENT, BUT ONLY TO THE EXTENT, OF ANY DIRECT, AS
OPPOSED TO CONSEQUENTIAL OR EXEMPLARY, DAMAGES SUFFERED BY THE BORROWER WHICH
THE BORROWER PROVES WERE CAUSED BY THE L/C ISSUER’S WILLFUL MISCONDUCT OR GROSS
NEGLIGENCE OR THE L/C ISSUER’S WILLFUL OR GROSSLY NEGLIGENT FAILURE TO PAY UNDER
ANY LETTER OF CREDIT AFTER THE PRESENTATION TO IT BY THE BENEFICIARY OF A SIGHT
DRAFT AND CERTIFICATE(S) STRICTLY COMPLYING WITH THE TERMS AND CONDITIONS OF A
LETTER OF CREDIT.  IN FURTHERANCE AND NOT IN LIMITATION OF THE FOREGOING, THE
L/C ISSUER MAY ACCEPT DOCUMENTS THAT APPEAR ON THEIR FACE TO BE IN ORDER,
WITHOUT RESPONSIBILITY FOR FURTHER INVESTIGATION, REGARDLESS OF ANY NOTICE OR
INFORMATION TO THE CONTRARY, AND THE L/C ISSUER SHALL NOT BE RESPONSIBLE FOR THE
VALIDITY OR SUFFICIENCY OF ANY INSTRUMENT TRANSFERRING OR ASSIGNING OR
PURPORTING TO TRANSFER OR ASSIGN A LETTER OF CREDIT OR THE RIGHTS OR BENEFITS
THEREUNDER OR PROCEEDS THEREOF, IN WHOLE OR IN PART, WHICH MAY PROVE TO BE
INVALID OR INEFFECTIVE FOR ANY REASON.

 

(G)           CASH COLLATERAL.  UPON THE REQUEST OF THE ADMINISTRATIVE AGENT,
(I) IF THE L/C ISSUER HAS HONORED ANY FULL OR PARTIAL DRAWING REQUEST UNDER ANY
LETTER OF CREDIT AND SUCH DRAWING HAS RESULTED IN AN L/C BORROWING AND THE
CONDITIONS SET FORTH IN SECTION 4.02 TO A REVOLVING CREDIT BORROWING CANNOT THEN
BE MET, OR (II) IF, AS OF THE LETTER OF CREDIT EXPIRATION DATE, ANY LETTER OF
CREDIT FOR ANY REASON REMAINS OUTSTANDING AND PARTIALLY OR WHOLLY UNDRAWN, THE
BORROWER SHALL IMMEDIATELY CASH COLLATERALIZE THE THEN OUTSTANDING AMOUNT OF ALL
L/C

 

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OBLIGATIONS (IN AN AMOUNT EQUAL TO SUCH OUTSTANDING AMOUNT DETERMINED AS OF THE
DATE OF SUCH L/C BORROWING OR THE LETTER OF CREDIT EXPIRATION DATE, AS THE CASE
MAY BE).  SECTIONS 2.05 AND 8.02 SET FORTH CERTAIN ADDITIONAL REQUIREMENTS TO
DELIVER CASH COLLATERAL HEREUNDER.  FOR PURPOSES OF THIS SECTION 2.03, SECTION
2.05 AND SECTION 8.02, “CASH COLLATERALIZE” MEANS TO PLEDGE AND DEPOSIT WITH OR
DELIVER TO THE ADMINISTRATIVE AGENT, FOR THE BENEFIT OF THE L/C ISSUER AND THE
LENDERS, AS COLLATERAL FOR THE L/C OBLIGATIONS, CASH OR DEPOSIT ACCOUNT BALANCES
(“CASH COLLATERAL”) OR ONE OR MORE BACKSTOP LETTERS OF CREDIT IN FORM AND
SUBSTANCE ACCEPTABLE TO, AND ISSUED BY FINANCIAL INSTITUTIONS REASONABLY
ACCEPTABLE TO, THE L/C ISSUER (EACH SUCH LETTER OF CREDIT, A “BACKSTOP L/C”)
PURSUANT TO DOCUMENTATION IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE
ADMINISTRATIVE AGENT AND THE L/C ISSUER (WHICH DOCUMENTS ARE HEREBY CONSENTED TO
BY THE LENDERS).  DERIVATIVES OF SUCH TERM HAVE CORRESPONDING MEANINGS.  THE
BORROWER HEREBY GRANTS TO THE ADMINISTRATIVE AGENT, FOR THE BENEFIT OF THE L/C
ISSUER AND THE LENDERS, A SECURITY INTEREST IN ALL SUCH CASH, DEPOSIT ACCOUNTS
AND ALL BALANCES THEREIN AND ALL PROCEEDS OF THE FOREGOING.  CASH COLLATERAL
SHALL BE MAINTAINED IN BLOCKED, NON-INTEREST BEARING DEPOSIT ACCOUNTS AT BANK OF
AMERICA.  IF AT ANY TIME THE ADMINISTRATIVE AGENT DETERMINES THAT ANY FUNDS HELD
AS CASH COLLATERAL ARE SUBJECT TO ANY RIGHT OR CLAIM OF ANY PERSON OTHER THAN
THE ADMINISTRATIVE AGENT OR THAT THE TOTAL AMOUNT OF SUCH FUNDS OR BACKSTOP L/CS
THEN HELD BY THE L/C ISSUER IS LESS THAN THE AGGREGATE OUTSTANDING AMOUNT OF ALL
L/C OBLIGATIONS, THE BORROWER WILL, FORTHWITH UPON DEMAND BY THE ADMINISTRATIVE
AGENT, EITHER (X) DELIVER ONE OR MORE ADDITIONAL BACKSTOP L/CS OR (Y) PAY TO THE
ADMINISTRATIVE AGENT, AS ADDITIONAL FUNDS TO BE DEPOSITED AND HELD IN THE
DEPOSIT ACCOUNTS AT BANK OF AMERICA AS AFORESAID, AN AMOUNT EQUAL TO THE EXCESS
OF (A) SUCH AGGREGATE OUTSTANDING AMOUNT OVER (B) THE TOTAL AMOUNT OF FUNDS, IF
ANY, THEN HELD AS CASH COLLATERAL THAT THE ADMINISTRATIVE AGENT DETERMINES TO BE
FREE AND CLEAR OF ANY SUCH RIGHT AND CLAIM OR SUBJECT TO SUCH EXISTING BACKSTOP
L/CS.  UPON THE DRAWING OF ANY LETTER OF CREDIT FOR WHICH FUNDS ARE ON DEPOSIT
AS CASH COLLATERAL, SUCH FUNDS SHALL BE APPLIED, TO THE EXTENT PERMITTED UNDER
APPLICABLE LAW, TO REIMBURSE THE L/C ISSUER.  TO THE EXTENT THE AMOUNT OF ANY
CASH COLLATERAL EXCEEDS THE THEN OUTSTANDING AMOUNT OF SUCH L/C OBLIGATIONS AND
SO LONG AS NO EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING, THE EXCESS SHALL
BE REFUNDED TO THE BORROWER.  TO THE EXTENT THAT THE AGGREGATE AMOUNT AVAILABLE
TO BE DRAWN UNDER ANY BACKSTOP L/C EXCEEDS THE OUTSTANDING AMOUNT OF SUCH L/C
OBLIGATIONS, THEN THE L/C ISSUER SHALL, UPON REQUEST BY THE BORROWER, USE
REASONABLE EFFORTS TO CAUSE THE AGGREGATE AMOUNT AVAILABLE TO BE DRAWN UNDER ANY
BACKSTOP L/C TO BE REDUCED BY THE AMOUNT OF SUCH EXCESS.

 

(H)           APPLICABILITY OF ISP98 AND UCP.  UNLESS OTHERWISE EXPRESSLY AGREED
BY THE L/C ISSUER AND THE BORROWER WHEN A LETTER OF CREDIT IS ISSUED (INCLUDING
ANY SUCH AGREEMENT APPLICABLE TO AN EXISTING LETTER OF CREDIT), (I) THE RULES OF
ISP SHALL APPLY TO EACH STANDBY LETTER OF CREDIT, AND (II) THE RULES OF THE
UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS, AS MOST RECENTLY PUBLISHED
BY THE INTERNATIONAL CHAMBER OF COMMERCE AT THE TIME OF ISSUANCE SHALL APPLY TO
EACH COMMERCIAL LETTER OF CREDIT.

 

(I)            LETTER OF CREDIT FEES.  THE BORROWER SHALL PAY TO THE
ADMINISTRATIVE AGENT FOR THE ACCOUNT OF EACH REVOLVING CREDIT LENDER IN
ACCORDANCE WITH ITS PRO RATA SHARE A LETTER OF CREDIT FEE (THE “LETTER OF CREDIT
FEE”) FOR EACH OUTSTANDING LETTER OF CREDIT EQUAL TO THE APPLICABLE RATE FOR
REVOLVING CREDIT LOANS WHICH ARE EURODOLLAR RATE LOANS TIMES THE DAILY MAXIMUM
AMOUNT AVAILABLE TO BE DRAWN UNDER SUCH LETTER OF CREDIT.  SUCH LETTER OF CREDIT
FEES SHALL BE (I) COMPUTED ON A QUARTERLY BASIS IN ARREARS AND (II) DUE AND
PAYABLE ON THE LAST BUSINESS DAY OF EACH MARCH, JUNE, SEPTEMBER AND DECEMBER,
COMMENCING WITH THE FIRST SUCH DATE TO OCCUR AFTER THE ISSUANCE OF SUCH LETTER
OF CREDIT, ON THE LETTER OF CREDIT EXPIRATION DATE AND THEREAFTER ON DEMAND.  IF
THERE IS ANY CHANGE IN THE APPLICABLE RATE SPECIFIED IN THE PRECEDING SENTENCE
DURING ANY QUARTER, THE DAILY MAXIMUM AMOUNT OF EACH LETTER OF CREDIT SHALL BE
COMPUTED AND MULTIPLIED BY THE APPLICABLE RATE SEPARATELY FOR EACH PERIOD DURING
SUCH QUARTER THAT SUCH APPLICABLE RATE WAS IN EFFECT.

 

(J)            FRONTING FEE AND DOCUMENTARY AND PROCESSING CHARGES PAYABLE TO
L/C ISSUER.  THE BORROWER SHALL PAY DIRECTLY TO THE L/C ISSUER FOR ITS OWN
ACCOUNT A FRONTING FEE WITH RESPECT TO EACH LETTER OF CREDIT EQUAL TO 0.125% PER
ANNUM TIMES THE AVERAGE DAILY MAXIMUM AMOUNT AVAILABLE TO BE DRAWN UNDER SUCH
LETTER OF CREDIT.  SUCH FRONTING FEE SHALL BE COMPUTED ON A QUARTERLY BASIS IN
ARREARS.  SUCH FRONTING FEE SHALL BE DUE AND PAYABLE ON THE LAST BUSINESS DAY OF
EACH OF SUCH MARCH, JUNE, SEPTEMBER AND DECEMBER, COMMENCING WITH THE FIRST SUCH
DATE TO

 

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OCCUR AFTER THE ISSUANCE OF SUCH LETTER OF CREDIT, ON THE LETTER OF CREDIT
EXPIRATION DATE AND THEREAFTER ON DEMAND.  IN ADDITION, THE BORROWER SHALL PAY
DIRECTLY TO THE L/C ISSUER FOR ITS OWN ACCOUNT THE CUSTOMARY ISSUANCE,
PRESENTATION, AMENDMENT AND OTHER PROCESSING FEES, AND OTHER STANDARD COSTS AND
CHARGES, OF THE L/C ISSUER RELATING TO LETTERS OF CREDIT AS FROM TIME TO TIME IN
EFFECT.  SUCH CUSTOMARY FEES AND STANDARD COSTS AND CHARGES ARE DUE AND PAYABLE
WITHIN FIVE BUSINESS DAYS OF DEMAND AND ARE NONREFUNDABLE.

 

(K)           CONFLICT WITH ISSUER DOCUMENTS.  IN THE EVENT OF ANY CONFLICT
BETWEEN THE TERMS HEREOF AND THE TERMS OF ANY LETTER OF CREDIT APPLICATION, THE
TERMS HEREOF SHALL CONTROL.

 

2.04         Swing Line Loans.  (a)  The Swing Line.  Subject to the terms and
conditions set forth herein, the Swing Line Lender agrees to make loans (each
such loan, a “Swing Line Loan”) to the Borrower from time to time on any
Business Day during the Availability Period in an aggregate amount not to exceed
at any time outstanding the amount of the Swing Line Sublimit, notwithstanding
the fact that such Swing Line Loans, when aggregated with the Pro Rata Share of
the Outstanding Amount of Loans and L/C Obligations of the Lender acting as
Swing Line Lender, may exceed the amount of such Lender’s Commitment; provided,
however, that after giving effect to any Swing Line Loan, (i) the Total
Outstandings shall not exceed the Aggregate Commitments, and (ii) the aggregate
Outstanding Amount of the Revolving Credit Loans of any Lender, plus such
Lender’s Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus
such Lender’s Pro Rata Share of the Outstanding Amount of all Swing Line Loans
shall not exceed such Lender’s Revolving Credit Commitment, and provided further
that the Borrower shall not use the proceeds of any Swing Line Loan to refinance
any outstanding Swing Line Loan.  Within the foregoing limits, and subject to
the other terms and conditions hereof, the Borrower may borrow under this
Section 2.04, prepay under Section 2.05, and reborrow under this Section 2.04. 
Each Swing Line Loan shall be a Base Rate Loan.  Immediately upon the making of
a Swing Line Loan, each Revolving Credit Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from the Swing Line Lender a
risk participation in such Swing Line Loan in an amount equal to the product of
such Lender’s Pro Rata Share times the amount of such Swing Line Loan.

 

(B)           BORROWING PROCEDURES.  EACH SWING LINE BORROWING SHALL BE MADE
UPON THE BORROWER’S IRREVOCABLE NOTICE TO THE SWING LINE LENDER AND THE
ADMINISTRATIVE AGENT, WHICH MAY BE GIVEN BY TELEPHONE.  EACH SUCH NOTICE MUST BE
RECEIVED BY THE SWING LINE LENDER AND THE ADMINISTRATIVE AGENT NOT LATER THAN
1:00 P.M. ON THE REQUESTED BORROWING DATE, AND SHALL

 

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SPECIFY (I) THE AMOUNT TO BE BORROWED, WHICH SHALL BE A MINIMUM OF $250,000, AND
(II) THE REQUESTED BORROWING DATE, WHICH SHALL BE A BUSINESS DAY.  EACH SUCH
TELEPHONIC NOTICE MUST BE CONFIRMED PROMPTLY BY DELIVERY TO THE SWING LINE
LENDER AND THE ADMINISTRATIVE AGENT OF A WRITTEN SWING LINE LOAN NOTICE,
APPROPRIATELY COMPLETED AND SIGNED BY A RESPONSIBLE OFFICER OF THE BORROWER. 
PROMPTLY AFTER RECEIPT BY THE SWING LINE LENDER OF ANY TELEPHONIC SWING LINE
LOAN NOTICE, THE SWING LINE LENDER WILL CONFIRM WITH THE ADMINISTRATIVE AGENT
(BY TELEPHONE OR IN WRITING) THAT THE ADMINISTRATIVE AGENT HAS ALSO RECEIVED
SUCH SWING LINE LOAN NOTICE AND, IF NOT, THE SWING LINE LENDER WILL NOTIFY THE
ADMINISTRATIVE AGENT (BY TELEPHONE OR IN WRITING) OF THE CONTENTS THEREOF. 
UNLESS THE SWING LINE LENDER HAS RECEIVED NOTICE (BY TELEPHONE OR IN WRITING)
FROM THE ADMINISTRATIVE AGENT (INCLUDING AT THE REQUEST OF ANY REVOLVING CREDIT
LENDER) PRIOR TO 2:00 P.M. ON THE DATE OF THE PROPOSED SWING LINE BORROWING (A)
DIRECTING THE SWING LINE LENDER NOT TO MAKE SUCH SWING LINE LOAN AS A RESULT OF
THE LIMITATIONS SET FORTH IN THE PROVISO TO THE FIRST SENTENCE OF SECTION
2.04(A), OR (B) THAT ONE OR MORE OF THE APPLICABLE CONDITIONS SPECIFIED IN
SECTION 4.02 IS NOT THEN SATISFIED, THEN, SUBJECT TO THE TERMS AND CONDITIONS
HEREOF, THE SWING LINE LENDER WILL, NOT LATER THAN 3:00 P.M. ON THE BORROWING
DATE SPECIFIED IN SUCH SWING LINE LOAN NOTICE, MAKE THE AMOUNT OF ITS SWING LINE
LOAN AVAILABLE TO THE BORROWER AT ITS OFFICE BY CREDITING THE ACCOUNT OF THE
BORROWER ON THE BOOKS OF THE SWING LINE LENDER IN IMMEDIATELY AVAILABLE FUNDS.

 

(C)           REFINANCING OF SWING LINE LOANS.  (I)  THE SWING LINE LENDER AT
ANY TIME IN ITS SOLE AND ABSOLUTE DISCRETION MAY REQUEST, ON BEHALF OF THE
BORROWER (WHICH HEREBY IRREVOCABLY AUTHORIZES THE SWING LINE LENDER TO SO
REQUEST ON ITS BEHALF), THAT EACH REVOLVING CREDIT LENDER MAKE A BASE RATE LOAN
IN AN AMOUNT EQUAL TO SUCH LENDER’S PRO RATA SHARE OF THE AMOUNT OF SWING LINE
LOANS THEN OUTSTANDING.  SUCH REQUEST SHALL BE MADE IN WRITING (WHICH WRITTEN
REQUEST SHALL BE DEEMED TO BE A COMMITTED LOAN NOTICE FOR PURPOSES HEREOF) AND
IN ACCORDANCE WITH THE REQUIREMENTS OF SECTION 2.02, WITHOUT REGARD TO THE
MINIMUM AND MULTIPLES SPECIFIED THEREIN FOR THE PRINCIPAL AMOUNT OF BASE RATE
LOANS, BUT SUBJECT TO THE UNUTILIZED PORTION OF THE AGGREGATE REVOLVING CREDIT
COMMITMENTS AND THE CONDITIONS SET FORTH IN SECTION 4.02.  THE SWING LINE LENDER
SHALL FURNISH THE BORROWER WITH A COPY OF THE APPLICABLE COMMITTED LOAN NOTICE
PROMPTLY AFTER DELIVERING SUCH NOTICE TO THE ADMINISTRATIVE AGENT.  EACH
REVOLVING CREDIT LENDER SHALL MAKE AN AMOUNT EQUAL TO ITS PRO RATA SHARE OF THE
AMOUNT SPECIFIED IN SUCH COMMITTED LOAN NOTICE AVAILABLE TO THE ADMINISTRATIVE
AGENT IN IMMEDIATELY AVAILABLE FUNDS FOR THE ACCOUNT OF THE SWING LINE LENDER AT
THE ADMINISTRATIVE AGENT’S OFFICE NOT LATER THAN 1:00 P.M. ON THE DAY SPECIFIED
IN SUCH COMMITTED LOAN NOTICE, WHEREUPON, SUBJECT TO SECTION 2.04(C)(II), EACH
REVOLVING CREDIT LENDER THAT SO MAKES FUNDS AVAILABLE SHALL BE DEEMED TO HAVE
MADE A BASE RATE LOAN TO THE BORROWER IN SUCH AMOUNT.  THE ADMINISTRATIVE AGENT
SHALL REMIT THE FUNDS SO RECEIVED TO THE SWING LINE LENDER AND THE SWING LINE
LENDER SHALL APPLY SUCH FUNDS IN REPAYMENT OF THE SWING LINE LOAN.

 

(II)           IF FOR ANY REASON ANY SWING LINE LOAN CANNOT BE REFINANCED BY
SUCH A REVOLVING CREDIT BORROWING IN ACCORDANCE WITH SECTION 2.04(C)(I), THE
REQUEST FOR BASE RATE LOANS SUBMITTED BY THE SWING LINE LENDER AS SET FORTH
HEREIN SHALL BE DEEMED TO BE A REQUEST BY THE SWING LINE LENDER THAT EACH OF THE
REVOLVING CREDIT LENDERS FUND ITS RISK PARTICIPATION IN THE RELEVANT SWING LINE
LOAN AND EACH REVOLVING CREDIT LENDER’S PAYMENT TO THE ADMINISTRATIVE AGENT FOR
THE ACCOUNT OF THE SWING LINE LENDER PURSUANT TO SECTION 2.04(C)(I) SHALL BE
DEEMED PAYMENT IN RESPECT OF SUCH PARTICIPATION.

 

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(III)          IF ANY REVOLVING CREDIT LENDER FAILS TO MAKE AVAILABLE TO THE
ADMINISTRATIVE AGENT FOR THE ACCOUNT OF THE SWING LINE LENDER ANY AMOUNT
REQUIRED TO BE PAID BY SUCH LENDER PURSUANT TO THE FOREGOING PROVISIONS OF THIS
SECTION 2.04(C) BY THE TIME SPECIFIED IN SECTION 2.04(C)(I), THE SWING LINE
LENDER SHALL BE ENTITLED TO RECOVER FROM SUCH LENDER (ACTING THROUGH THE
ADMINISTRATIVE AGENT), ON DEMAND, SUCH AMOUNT WITH INTEREST THEREON FOR THE
PERIOD FROM THE DATE SUCH PAYMENT IS REQUIRED TO THE DATE ON WHICH SUCH PAYMENT
IS IMMEDIATELY AVAILABLE TO THE SWING LINE LENDER AT A RATE PER ANNUM EQUAL TO
THE FEDERAL FUNDS RATE FROM TIME TO TIME IN EFFECT.  A CERTIFICATE OF THE SWING
LINE LENDER SUBMITTED TO ANY LENDER (THROUGH THE ADMINISTRATIVE AGENT) WITH
RESPECT TO ANY AMOUNTS OWING UNDER THIS CLAUSE (III) SHALL BE CONCLUSIVE ABSENT
MANIFEST ERROR.

 

(IV)          EACH REVOLVING CREDIT LENDER’S OBLIGATION TO MAKE REVOLVING CREDIT
LOANS OR TO PURCHASE AND FUND RISK PARTICIPATIONS IN SWING LINE LOANS PURSUANT
TO THIS SECTION 2.04(C) SHALL BE ABSOLUTE AND UNCONDITIONAL AND SHALL NOT BE
AFFECTED BY ANY CIRCUMSTANCE, INCLUDING (A) ANY SETOFF, COUNTERCLAIM,
RECOUPMENT, DEFENSE OR OTHER RIGHT WHICH SUCH LENDER MAY HAVE AGAINST THE SWING
LINE LENDER, THE BORROWER OR ANY OTHER PERSON FOR ANY REASON WHATSOEVER, (B) THE
OCCURRENCE OR CONTINUANCE OF A DEFAULT, OR (C) ANY OTHER OCCURRENCE, EVENT OR
CONDITION, WHETHER OR NOT SIMILAR TO ANY OF THE FOREGOING; PROVIDED, HOWEVER,
THAT EACH REVOLVING CREDIT LENDER’S OBLIGATION TO MAKE REVOLVING CREDIT LOANS
PURSUANT TO THIS SECTION 2.04(C) IS SUBJECT TO THE CONDITIONS SET FORTH IN
SECTION 4.02 (OTHER THAN DELIVERY OF A COMMITTED LOAN NOTICE).  NO SUCH FUNDING
OF RISK PARTICIPATIONS SHALL RELIEVE OR OTHERWISE IMPAIR THE OBLIGATION OF THE
BORROWER TO REPAY SWING LINE LOANS, TOGETHER WITH INTEREST AS PROVIDED HEREIN.

 

(D)           REPAYMENT OF PARTICIPATIONS.  (I)  AT ANY TIME AFTER ANY REVOLVING
CREDIT LENDER HAS PURCHASED AND FUNDED A RISK PARTICIPATION IN A SWING LINE
LOAN, IF THE SWING LINE LENDER RECEIVES ANY PAYMENT ON ACCOUNT OF SUCH SWING
LINE LOAN, THE SWING LINE LENDER WILL DISTRIBUTE TO SUCH LENDER ITS PRO RATA
SHARE OF SUCH PAYMENT (APPROPRIATELY ADJUSTED, IN THE CASE OF INTEREST PAYMENTS,
TO REFLECT THE PERIOD OF TIME DURING WHICH SUCH LENDER’S RISK PARTICIPATION WAS
FUNDED) IN THE SAME FUNDS AS THOSE RECEIVED BY THE SWING LINE LENDER.

 

(II)           IF ANY PAYMENT RECEIVED BY THE SWING LINE LENDER IN RESPECT OF
PRINCIPAL OR INTEREST ON ANY SWING LINE LOAN IS REQUIRED TO BE RETURNED BY THE
SWING LINE LENDER UNDER ANY OF THE CIRCUMSTANCES DESCRIBED IN SECTION 10.06
(INCLUDING PURSUANT TO ANY SETTLEMENT ENTERED INTO BY THE SWING LINE LENDER IN
ITS DISCRETION), EACH REVOLVING CREDIT LENDER SHALL PAY TO THE SWING LINE LENDER
ITS PRO RATA SHARE THEREOF ON DEMAND OF THE ADMINISTRATIVE AGENT, PLUS INTEREST
THEREON FROM THE DATE OF SUCH DEMAND TO THE DATE SUCH AMOUNT IS RETURNED, AT A
RATE PER ANNUM EQUAL TO THE FEDERAL FUNDS RATE.  THE ADMINISTRATIVE AGENT WILL
MAKE SUCH DEMAND UPON THE REQUEST OF THE SWING LINE LENDER.

 

(E)           INTEREST FOR ACCOUNT OF SWING LINE LENDER.  THE SWING LINE LENDER
SHALL BE RESPONSIBLE FOR INVOICING THE BORROWER FOR INTEREST ON THE SWING LINE
LOANS.  UNTIL EACH REVOLVING CREDIT LENDER FUNDS ITS BASE RATE LOAN OR RISK
PARTICIPATION PURSUANT TO THIS SECTION 2.04 TO REFINANCE SUCH LENDER’S PRO RATA
SHARE OF ANY SWING LINE LOAN, INTEREST IN RESPECT OF SUCH PRO RATA SHARE SHALL
BE SOLELY FOR THE ACCOUNT OF THE SWING LINE LENDER.

 

56

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(F)            PAYMENTS DIRECTLY TO SWING LINE LENDER.  THE BORROWER SHALL MAKE
ALL PAYMENTS OF PRINCIPAL AND INTEREST IN RESPECT OF THE SWING LINE LOANS
DIRECTLY TO THE SWING LINE LENDER.

 

2.05         Prepayments.  (a)  Optional.  (i)  The Borrower may, upon notice to
the Administrative Agent, at any time or from time to time voluntarily prepay
Loans in whole or in part without premium or penalty; provided that (1) such
notice must be received by the Administrative Agent not later than 1:00 p.m. (A)
three Business Days prior to any date of prepayment of Eurodollar Rate Loans or
Screen Rate Loans and (B) on the date of prepayment of Base Rate Loans; (2) any
prepayment of Eurodollar Rate Loans shall be in a minimum principal amount of
$2,000,000 or a whole multiple of $500,000 in excess thereof; (3) any prepayment
of Canadian Term Loans shall be in a principal amount of CD2,000,000 or a whole
multiple of CD500,000 in excess thereof; and (4) any prepayment of Base Rate
Loans shall be in a minimum principal amount of $500,000 or a whole multiple of
$100,000 in excess thereof or, in each case, if less, the entire principal
amount thereof then outstanding.  Each such notice shall specify the date and
amount of such prepayment and the Type(s) of Loans to be prepaid.  The
Administrative Agent will promptly notify each Lender of its receipt of each
such notice, and of the amount of such Lender’s Pro Rata Share of such
prepayment.  If such notice is given by the Borrower, the Borrower shall make
such prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein; provided that the Borrower may rescind or
postpone any such notice of prepayment if such prepayment would have resulted
from a refinancing of all the Loans and such refinancing shall not be
consummated or otherwise shall be delayed.  Any prepayment of a Eurodollar Rate
Loan or Screen Rate Loan shall be accompanied by all accrued interest thereon,
together with any additional amounts required pursuant to Section 3.05.  Each
prepayment of the outstanding Term Loans pursuant to this Section 2.05(a) shall
be applied ratably among the Dollar Term Facility and Canadian Term Facility,
and to the principal repayment installments of the Term Facility in such order
of maturity as the Borrower may direct and each such prepayment shall be paid to
the Lenders in accordance with their respective Pro Rata Shares (it being
understood that after such ratable allocation among the Dollar Term Facility and
Canadian Term Facility, an amount less than the applicable minimum amounts
specified in the first sentence of this Section 2.05(a) may be paid to the
applicable Lenders).

 

(II)           THE BORROWER MAY, UPON NOTICE TO THE SWING LINE LENDER (WITH A
COPY TO THE ADMINISTRATIVE AGENT), AT ANY TIME OR FROM TIME TO TIME, VOLUNTARILY
PREPAY SWING LINE LOANS IN WHOLE OR IN PART WITHOUT PREMIUM OR PENALTY; PROVIDED
THAT (1) SUCH NOTICE MUST BE RECEIVED BY THE SWING LINE LENDER AND THE
ADMINISTRATIVE AGENT NOT LATER THAN 1:00 P.M. ON THE DATE OF THE PREPAYMENT, AND
(2) ANY SUCH PREPAYMENT SHALL BE IN A MINIMUM PRINCIPAL AMOUNT OF $100,000. 
EACH SUCH NOTICE SHALL SPECIFY THE DATE AND AMOUNT OF SUCH PREPAYMENT.  IF SUCH
NOTICE IS GIVEN BY THE BORROWER, THE BORROWER SHALL MAKE SUCH PREPAYMENT AND THE
PAYMENT AMOUNT SPECIFIED IN SUCH NOTICE SHALL BE DUE AND PAYABLE ON THE DATE
SPECIFIED THEREIN.

 

(B)           MANDATORY.  (I)  WITHIN FIVE BUSINESS DAYS AFTER FINANCIAL
STATEMENTS HAVE BEEN DELIVERED PURSUANT TO SECTION 6.13(C) AND THE RELATED
COMPLIANCE CERTIFICATE HAS BEEN DELIVERED PURSUANT TO SECTION 6.13(D), THE
BORROWER SHALL PREPAY AN AGGREGATE PRINCIPAL AMOUNT OF LOANS EQUAL TO, IF THE
TOTAL LEVERAGE RATIO FOR SUCH FISCAL YEAR IS (X) GREATER THAN OR EQUAL TO
4.00:1.00, 50%, (Y) LESS THAN 4:00:1.00, BUT GREATER THAN OR EQUAL TO 3:00:1.00,
25% OR (Z) LESS

 

57

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THAN 3:00:1.00, 0%, IN EACH CASE, OF EXCESS CASH FLOW FOR THE FISCAL YEAR
COVERED BY SUCH FINANCIAL STATEMENTS, COMMENCING WITH THE FISCAL YEAR ENDED
DECEMBER 31, 2004; PROVIDED, THAT EXCESS CASH FLOW FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2004 SHALL BE CALCULATED ON A PRO FORMA BASIS AS THOUGH THE NU-GRO
ACQUISITION HAD OCCURRED ON THE FIRST DAY OF SUCH FISCAL YEAR; PROVIDED FURTHER
THAT ANY CALCULATION OF EXCESS CASH FLOW BY THE BORROWER MAY CONTAIN CUSTOMARY
CURRENCY TRANSLATION ESTIMATES, AND MAY FURTHER CONTAIN DEDUCTIONS IN RESPECT OF
WITHHOLDING TAXES THAT WOULD BE OTHERWISE PAYABLE IF SUCH FUNDS WERE REPATRIATED
TO THE UNITED STATES AS REASONABLY DETERMINED BY A RESPONSIBLE OFFICER OF THE
BORROWER.

 

(II)           IF, IN EACH CASE, HOLDINGS, THE BORROWER OR ANY OF THEIR
RESPECTIVE SUBSIDIARIES DISPOSES OF ANY PROPERTY OR ASSETS IN ANY SINGLE
TRANSACTION OR SERIES OF RELATED TRANSACTIONS (OTHER THAN ANY DISPOSITION OF ANY
PROPERTY OR ASSETS PERMITTED BY CLAUSES (A), (B), (C), (D), (E), (F), (H), (I),
(M), (N), (R) OR (S) OF SECTION 7.04) WHICH IN THE AGGREGATE RESULTS IN THE
RECEIPT BY HOLDINGS, THE BORROWER OR SUCH SUBSIDIARY OF NET CASH PROCEEDS IN
EXCESS OF $2,000,000 OR RECEIPT OF CONDEMNATION OR CASUALTY PROCEEDS IN RESPECT
OF ANY ASSET OR PROPERTY, THE BORROWER SHALL PREPAY AN AGGREGATE PRINCIPAL
AMOUNT OF LOANS IN AN AMOUNT EQUAL TO 100% OF ALL NET CASH PROCEEDS RECEIVED
THEREFROM WITHIN TWO BUSINESS DAYS OF RECEIPT THEREOF BY HOLDINGS OR SUCH
SUBSIDIARY; PROVIDED, HOWEVER, THAT, WITH RESPECT TO ANY NET CASH PROCEEDS
RECEIVED IN RESPECT OF A DISPOSITION OR PROCEEDS OF INSURANCE AND CONDEMNATION
AWARDS DESCRIBED IN THIS SECTION 2.05(B)(II), AT THE OPTION OF THE BORROWER (AS
ELECTED BY THE BORROWER IN WRITING TO THE ADMINISTRATIVE AGENT ON OR PRIOR TO
THE DATE OF THE RECEIPT OF SUCH PROCEEDS OR AWARDS), AND SO LONG AS NO EVENT OF
DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING, THE BORROWER MAY REINVEST ALL OR
ANY PORTION OF SUCH NET CASH PROCEEDS IN ASSETS USEFUL IN ITS BUSINESS SO LONG
AS (X) WITHIN 360 DAYS AFTER THE RECEIPT OF SUCH NET CASH PROCEEDS, SUCH
PURCHASE OR REPAIR SHALL HAVE BEEN CONSUMMATED OR (Y) IF THE BORROWER OR THE
RELEVANT SUBSIDIARY HAS ENTERED INTO A DEFINITIVE AGREEMENT WITHIN 360 DAYS
AFTER ITS RECEIPT OF SUCH NET CASH PROCEEDS TO PURCHASE OR REPAIR SUCH ASSETS
WITHIN 180 DAYS THEREAFTER, WITHIN SUCH 180 DAYS AFTER SUCH RECEIPT OF NET CASH
PROCEEDS (IN EACH CASE, AS CERTIFIED BY THE BORROWER IN WRITING TO THE
ADMINISTRATIVE AGENT); PROVIDED FURTHER, HOWEVER, THAT ANY NET CASH PROCEEDS NOT
SUBJECT TO SUCH DEFINITIVE AGREEMENT OR SO REINVESTED SHALL BE IMMEDIATELY
APPLIED TO THE PREPAYMENT OF THE LOANS AS SET FORTH IN THIS SECTION 2.05; AND
PROVIDED STILL FURTHER THAT ANY NET CASH PROCEEDS RECEIVED IN CONNECTION WITH
ANY DISPOSITION OF PROPERTY OR ASSETS LOCATED OUTSIDE THE UNITED STATES MAY
CONTAIN DEDUCTIONS IN RESPECT OF WITHHOLDING TAXES THAT WOULD OTHERWISE BE
PAYABLE IF SUCH FUNDS WERE REPATRIATED TO THE UNITED STATES.

 

(III)          UPON EACH SPECIFIED EQUITY ISSUANCE, THE BORROWER SHALL PREPAY AN
AGGREGATE PRINCIPAL AMOUNT OF LOANS IN AN AMOUNT EQUAL TO (X) IF THE TOTAL
LEVERAGE RATIO FOR THE MOST RECENT MEASUREMENT PERIOD ENDING ON OR PRIOR TO THE
DATE OF SUCH SALE IS GREATER THAN OR EQUAL TO 4.00:1.00, 50%, (Y) IF THE TOTAL
LEVERAGE RATIO FOR THE MEASUREMENT PERIOD ENDING ON OR PRIOR TO THE DATE OF SUCH
SALE IS LESS THAN 4.00:1.00 BUT GREATER THAN OR EQUAL TO 3.00:1.00, 25% AND
(Z) IF THE TOTAL LEVERAGE RATIO FOR THE MOST RECENT MEASUREMENT PERIOD ENDING ON
OR PRIOR TO THE DATE OF SUCH SALE IS LESS THAN 3.00:1.00, 0% OF ALL NET CASH
PROCEEDS RECEIVED THEREFROM IMMEDIATELY UPON RECEIPT THEREOF BY THE BORROWER (OR
AFTER THE OCCURRENCE OF THE HOLDING COMPANY EVENT, HOLDINGS).

 

(IV)          UPON THE INCURRENCE OR ISSUANCE BY HOLDINGS, THE BORROWER OR ANY
OF THEIR RESPECTIVE SUBSIDIARIES OF (A) ANY INDEBTEDNESS NOT EXPRESSLY PERMITTED
TO BE INCURRED OR ISSUED

 

58

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PURSUANT TO SECTION 7.02, AND (B) ANY PERMITTED SUBORDINATED INDEBTEDNESS
PERMITTED TO BE INCURRED PURSUANT TO SECTION 7.02(A), TO THE EXTENT NOT
PERMITTED TO BE RETAINED BY THE BORROWER THEREUNDER, THE BORROWER SHALL PREPAY
AN AGGREGATE PRINCIPAL AMOUNT OF LOANS IN AN AMOUNT EQUAL TO 100% OF ALL NET
CASH PROCEEDS RECEIVED THEREFROM IMMEDIATELY UPON RECEIPT THEREOF BY HOLDINGS,
THE BORROWER OR SUCH SUBSIDIARY.

 

(V)           IF FOR ANY REASON THE TOTAL OUTSTANDINGS AT ANY TIME EXCEED THE
AGGREGATE COMMITMENTS THEN IN EFFECT, THE BORROWER SHALL IMMEDIATELY PREPAY
LOANS AND/OR CASH COLLATERALIZE THE L/C OBLIGATIONS IN AN AGGREGATE AMOUNT EQUAL
TO SUCH EXCESS; PROVIDED, HOWEVER, THAT THE BORROWER SHALL NOT BE REQUIRED TO
CASH COLLATERALIZE THE L/C OBLIGATIONS PURSUANT TO THIS SECTION 2.05(B)(V)
UNLESS AFTER THE PREPAYMENT IN FULL OF THE LOANS AND SWING LINE LOANS THE TOTAL
OUTSTANDINGS EXCEED THE AGGREGATE COMMITMENTS THEN IN EFFECT.

 

(VI)          EACH PREPAYMENT OF LOANS PURSUANT TO THIS SECTION 2.05(B) SHALL BE
APPLIED, FIRST, TO THE TERM FACILITIES, RATABLY AMONG THE DOLLAR TERM FACILITY
AND THE CANADIAN TERM FACILITY AND (I) TO NEXT FOUR PRINCIPAL REPAYMENT
INSTALLMENTS OF EACH SUCH FACILITY IN DIRECT ORDER OF MATURITY AND (II) TO THE
REMAINING PRINCIPAL REPAYMENT INSTALLMENTS OF EACH SUCH FACILITY ON A PRO-RATA
BASIS BASED ON THE NUMBER OF REMAINING INSTALLMENTS AND, THEREAFTER, TO THE
REVOLVING CREDIT FACILITY (THE AMOUNT OF SUCH PREPAYMENT OF THE REVOLVING CREDIT
FACILITY, THE “REDUCTION AMOUNT”) IN THE MANNER SET FORTH IN CLAUSE (VII) OF
THIS SECTION 2.05(B); AND EACH SUCH PREPAYMENT SHALL BE PAID TO THE LENDERS IN
ACCORDANCE WITH THEIR RESPECTIVE PRO RATA SHARES.

 

(VII)         THE REVOLVING CREDIT FACILITY SHALL BE PERMANENTLY REDUCED BY THE
REDUCTION AMOUNT ON THE DATE OF THE APPLICABLE PREPAYMENT AND SUCH PREPAYMENT
SHALL BE, FIRST, APPLIED TO PREPAY L/C BORROWINGS OUTSTANDING AT SUCH TIME UNTIL
ALL SUCH L/C BORROWINGS ARE PAID IN FULL, SECOND, APPLIED TO PREPAY SWING LINE
LOANS OUTSTANDING AT SUCH TIME UNTIL ALL SUCH SWING LINE LOANS ARE PAID IN FULL,
THIRD, APPLIED TO PREPAY REVOLVING CREDIT LOANS OUTSTANDING AT SUCH TIME UNTIL
ALL SUCH REVOLVING CREDIT LOANS ARE PAID IN FULL AND, FOURTH, USED TO CASH
COLLATERALIZE THE L/C OBLIGATIONS; AND, THEREAFTER, THE AMOUNT REMAINING, IF
ANY, AFTER THE PREPAYMENT IN FULL OF ALL LOANS AND L/C BORROWINGS OUTSTANDING AT
SUCH TIME AND THE L/C OBLIGATIONS HAVE BEEN CASH COLLATERALIZED IN FULL MAY BE
RETAINED BY THE BORROWER FOR USE IN THE ORDINARY COURSE OF ITS BUSINESS.  UPON
THE DRAWING OF ANY LETTER OF CREDIT WHICH HAS BEEN CASH COLLATERALIZED, SUCH
FUNDS SHALL BE APPLIED (WITHOUT ANY FURTHER ACTION BY OR NOTICE TO OR FROM THE
BORROWER OR ANY OTHER LOAN PARTY) TO REIMBURSE THE L/C ISSUER OR THE REVOLVING
CREDIT LENDERS, AS APPLICABLE.

 

(VIII)        NOTWITHSTANDING ANY OF THE OTHER PROVISIONS OF SECTION 2.05(B)(I)
THROUGH (VII), THE BORROWER MAY, IN ITS SOLE DISCRETION, DEPOSIT THE AMOUNT OF
ANY SUCH PREPAYMENT OTHERWISE REQUIRED TO BE MADE THEREUNDER INTO A CASH
COLLATERAL ACCOUNT UNTIL THE LAST DAY OF ANY INTEREST PERIOD PERTAINING TO LOANS
BEING PREPAID, AT WHICH TIME THE ADMINISTRATIVE AGENT SHALL BE AUTHORIZED
(WITHOUT ANY FURTHER ACTION BY OR NOTICE TO OR FROM THE BORROWER OR ANY OTHER
LOAN PARTY) TO APPLY SUCH AMOUNT TO THE PREPAYMENT OF SUCH LOANS IN ACCORDANCE
WITH THIS SECTION 2.05(B).  UPON THE OCCURRENCE AND DURING THE CONTINUANCE OF
ANY EVENT OF DEFAULT, THE ADMINISTRATIVE AGENT SHALL ALSO BE AUTHORIZED (WITHOUT
ANY FURTHER ACTION BY OR NOTICE TO OR FROM THE BORROWER OR ANY OTHER LOAN PARTY)
TO APPLY SUCH AMOUNT TO THE PREPAYMENT OF THE OUTSTANDING LOANS IN ACCORDANCE
WITH THIS SECTION 2.05(B).

 

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(IX)           ANYTHING CONTAINED IN THIS SECTION 2.05(B) TO THE CONTRARY
NOTWITHSTANDING, (A) IF, FOLLOWING THE OCCURRENCE OF ANY DISPOSITION BY ANY LOAN
PARTY OR ANY OF ITS SUBSIDIARIES, THE BORROWER IS REQUIRED TO COMMIT BY A
PARTICULAR DATE (A “COMMITMENT DATE”) TO APPLY OR CAUSE ITS SUBSIDIARIES TO
APPLY AN AMOUNT EQUAL TO ANY OF THE PROCEEDS THEREOF IN A PARTICULAR MANNER, OR
TO APPLY BY A PARTICULAR DATE (AN “APPLICATION DATE”) AN AMOUNT EQUAL TO ANY
SUCH PROCEEDS IN A PARTICULAR MANNER, IN EITHER CASE IN ORDER TO EXCUSE THE
BORROWER FROM BEING REQUIRED TO MAKE AN OFFER TO THE HOLDERS OF ANY OTHER DEBT
OR EQUITY SECURITIES OF THE BORROWER (AN “ASSET SALE OFFER”) IN CONNECTION WITH
SUCH DISPOSITION, AND THE BORROWER SHALL HAVE FAILED TO SO COMMIT OR TO SO APPLY
AN AMOUNT EQUAL TO SUCH PROCEEDS ON OR PRIOR TO THE APPLICABLE COMMITMENT DATE
OR APPLICATION DATE, AS THE CASE MAY BE, OR (B) IF THE BORROWER AT ANY OTHER
TIME SHALL HAVE FAILED TO APPLY OR COMMIT OR CAUSE TO BE APPLIED AN AMOUNT EQUAL
TO ANY SUCH PROCEEDS, AND, ASSUMING NO FURTHER APPLICATION OR COMMITMENT OF AN
AMOUNT EQUAL TO SUCH PROCEEDS THE BORROWER WOULD OTHERWISE BE REQUIRED TO MAKE
AN ASSET SALE OFFER IN RESPECT THEREOF, THEN IN EITHER SUCH CASE THE BORROWER
SHALL IMMEDIATELY PAY OR CAUSE TO BE PAID TO THE ADMINISTRATIVE AGENT ON OR
PRIOR TO THE DATE ON WHICH THE BORROWER WOULD BE REQUIRED TO MAKE AN ASSET SALE
OFFER AN AMOUNT EQUAL TO SUCH PROCEEDS  TO BE APPLIED TO THE PAYMENT OF THE
LOANS AND L/C BORROWINGS AND TO CASH COLLATERALIZE THE L/C OBLIGATIONS IN THE
MANNER SET FORTH IN SECTION 2.05(B) IN SUCH AMOUNTS AS SHALL EXCUSE THE BORROWER
FROM MAKING ANY SUCH ASSET SALE OFFER.

 

2.06         Termination or Reduction of Commitments.  (a)  Optional.  The
Borrower may, upon notice to the Administrative Agent, terminate the portions of
the Term Commitments, the Letter of Credit Sublimit, or the unused Revolving
Credit Commitments, or from time to time permanently reduce the portions of the
Term Commitments, the Letter of Credit Sublimit, or the unused Revolving Credit
Commitments; provided that (i) any such notice shall be received by the
Administrative Agent not later than 1:00 p.m. one Business Day prior to the date
of termination or reduction, (ii) any such partial reduction shall be in an
aggregate amount of (A) in the case of all Loans other than Canadian Term Loans,
$10,000,000 or any whole multiple of $1,000,000 in excess thereof and (B)  in
the case of  Canadian Term Loans, CD10,000,000 or any whole multiple of
CD1,000,000 in excess thereof and (iii) the Borrower shall not terminate or
reduce the Term Commitments, the Letter of Credit Sublimit, or the unused
Revolving Credit Commitments if, after giving effect thereto and to any
concurrent prepayments hereunder, the Total Outstandings would exceed the
Aggregate Commitments; provided that the Borrower may rescind or postpone any
such notice of termination of the Revolving Credit Commitments if such
termination would have resulted from a refinancing of all the Loans and such
refinancing shall not be consummated or otherwise shall be delayed.

 

(B)           MANDATORY.  (I)  THE COMMITMENTS UNDER EACH TERM FACILITY SHALL BE
AUTOMATICALLY AND PERMANENTLY REDUCED FROM TIME TO TIME UPON EACH REPAYMENT OR
PREPAYMENT OF THE OUTSTANDING TERM LOANS, BY AN AMOUNT EQUAL TO THE AMOUNT BY
WHICH (A) THE COMMITMENTS UNDER SUCH TERM FACILITY IMMEDIATELY PRIOR TO SUCH
REDUCTION EXCEEDS (B) THE AGGREGATE PRINCIPAL AMOUNT OF ALL TERM LOANS
OUTSTANDING UNDER SUCH TERM FACILITY AT SUCH TIME.

 

(II)           THE REVOLVING CREDIT FACILITY SHALL BE AUTOMATICALLY AND
PERMANENTLY REDUCED ON EACH DATE ON WHICH THE PREPAYMENT OF REVOLVING CREDIT
LOANS OUTSTANDING THEREUNDER IS REQUIRED TO BE MADE PURSUANT TO SECTION
2.05(B)(I), (II), (III) OR (IV) BY AN AMOUNT EQUAL TO THE APPLICABLE REDUCTION
AMOUNT.

 

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(III)          IF AFTER GIVING EFFECT TO ANY REDUCTION OR TERMINATION OF UNUSED
REVOLVING CREDIT COMMITMENTS UNDER THIS SECTION 2.06, THE LETTER OF CREDIT
SUBLIMIT OR THE SWING LINE SUBLIMIT EXCEEDS THE AMOUNT OF THE AGGREGATE
REVOLVING CREDIT COMMITMENTS, SUCH SUBLIMIT SHALL BE AUTOMATICALLY REDUCED BY
THE AMOUNT OF SUCH EXCESS.

 

(C)           APPLICATION OF COMMITMENT REDUCTIONS; PAYMENT OF FEES.  THE
ADMINISTRATIVE AGENT WILL PROMPTLY NOTIFY THE LENDERS OF ANY TERMINATION OR
REDUCTION OF THE TERM COMMITMENT, THE LETTER OF CREDIT SUBLIMIT, OR THE UNUSED
REVOLVING CREDIT COMMITMENT UNDER THIS SECTION 2.06.  EACH REDUCTION OF THE TERM
COMMITMENTS PURSUANT TO SECTION 2.06(A) SHALL BE APPLIED TO THE APPLICABLE TERM
FACILITY.  UPON ANY REDUCTION OF COMMITMENTS UNDER A FACILITY, THE COMMITMENT OF
EACH LENDER UNDER SUCH FACILITY SHALL BE REDUCED BY SUCH LENDER’S PRO RATA SHARE
OF THE AMOUNT BY WHICH SUCH FACILITY IS REDUCED (OTHER THAN THE TERMINATION OF
THE COMMITMENT OF ANY LENDER AS PROVIDED IN SECTION 3.07).  ALL COMMITMENT FEES
ACCRUED UNTIL THE EFFECTIVE DATE OF ANY TERMINATION OF THE AGGREGATE COMMITMENTS
SHALL BE PAID ON THE EFFECTIVE DATE OF SUCH TERMINATION.

 

2.07         Repayment of Loans.  (a)  Dollar Term Loans.  The Borrower shall
repay to the Administrative Agent for the ratable account of the Dollar Term
Lenders the aggregate principal amount of all Dollar Term Loans outstanding on
the following dates in the respective amounts set forth opposite such dates
(which amounts shall be reduced as a result of the application of prepayments in
accordance with the order of priority set forth in Section 2.05) or increased as
a result of any increase in the amount of Dollar Term Loans pursuant to Section
2.14 (such increased amortization payments to be calculated in the same manner
(and on the same basis) as the schedules set forth below for the Dollar Term
Loans made as of the Closing Date).

 

Date

 

Dollar Term Loan Principal Amortization Amount

 

June 30, 2004

 

$

837,500

 

September 30, 2004

 

$

837,500

 

December 31, 2004

 

$

837,500

 

March 31, 2005

 

$

837,500

 

June 30, 2005

 

$

837,500

 

September 30, 2005

 

$

837,500

 

December 31, 2005

 

$

837,500

 

March 31, 2006

 

$

837,500

 

June 30, 2006

 

$

837,500

 

September 30, 2006

 

$

837,500

 

December 31, 2006

 

$

837,500

 

March 31, 2007

 

$

837,500

 

June 30, 2007

 

$

837,500

 

September 30, 2007

 

$

837,500

 

December 31, 2007

 

$

837,500

 

March 31, 2008

 

$

837,500

 

June 30, 2008

 

$

837,500

 

September 30, 2008

 

$

837,500

 

December 31, 2008

 

$

837,500

 

March 31, 2009

 

$

837,500

 

June 30, 2009

 

$

837,500

 

September 30, 2009

 

$

837,500

 

December 31, 2009

 

$

837,500

 

March 31, 2010

 

$

837,500

 

June 30, 2010

 

$

78,725,000

 

September 30, 2010

 

$

78,725,000

 

December 31, 2010

 

$

78,725,000

 

March 31, 2011

 

$

78,725,000

 

 

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provided, however, that the final principal repayment installment of the Dollar
Term Loans shall be repaid on the Maturity Date for the Facility under which
such Loans were made and in any event shall be in an amount equal to the
aggregate principal amount of all Dollar Term Loans outstanding on such date.

 

(B)           CANADIAN TERM LOANS.  THE BORROWER SHALL REPAY TO THE
ADMINISTRATIVE AGENT FOR THE RATABLE ACCOUNT OF THE CANADIAN TERM LENDERS THE
AGGREGATE PRINCIPAL AMOUNT OF ALL CANADIAN TERM LOANS OUTSTANDING ON THE
FOLLOWING DATES IN THE RESPECTIVE AMOUNTS SET FORTH OPPOSITE SUCH DATES (WHICH
AMOUNTS SHALL BE REDUCED AS A RESULT OF THE APPLICATION OF PREPAYMENTS IN
ACCORDANCE WITH THE ORDER OF PRIORITY SET FORTH IN SECTION 2.05) OR INCREASED AS
A RESULT OF ANY INCREASE IN THE AMOUNT OF CANADIAN TERM LOANS PURSUANT TO
SECTION 2.14 (SUCH INCREASED AMORTIZATION PAYMENTS TO BE CALCULATED IN THE SAME
MANNER (AND ON THE SAME BASIS) AS THE SCHEDULES SET FORTH BELOW FOR THE CANADIAN
TERM LOANS MADE AS OF THE CLOSING DATE);

 

Date

 

Canadian Term Loan Principal Amortization Amount

 

June 30, 2004

 

CD

169,250

 

September 30, 2004

 

CD

169,250

 

December 31, 2004

 

CD

169,250

 

March 31, 2005

 

CD

169,250

 

June 30, 2005

 

CD

169,250

 

September 30, 2005

 

CD

169,250

 

December 31, 2005

 

CD

169,250

 

March 31, 2006

 

CD

169,250

 

June 30, 2006

 

CD

169,250

 

September 30, 2006

 

CD

169,250

 

December 31, 2006

 

CD

169,250

 

March 31, 2007

 

CD

169,250

 

June 30, 2007

 

CD

169,250

 

September 30, 2007

 

CD

169,250

 

December 31, 2007

 

CD

169,250

 

March 31, 2008

 

CD

169,250

 

June 30, 2008

 

CD

169,250

 

September 30, 2008

 

CD

169,250

 

December 31, 2008

 

CD

169,250

 

March 31, 2009

 

CD

169,250

 

June 30, 2009

 

CD

169,250

 

September 30, 2009

 

CD

169,250

 

December 31, 2009

 

CD

169,250

 

March 31, 2010

 

CD

169,250

 

June 30, 2010

 

CD

15,909,500

 

September 30, 2010

 

CD

15,909,500

 

December 31, 2010

 

CD

15,909,500

 

March 31, 2011

 

CD

15,909,500

 

 

62

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

 

provided, however, that the final principal repayment installment of the
Canadian Term Loans shall be repaid on the Maturity Date for the Facility under
which such Loans were made and in any event shall be in an amount equal to the
aggregate principal amount of all Canadian Term Loans outstanding on such date.

 

(C)           REVOLVING CREDIT LOANS.  THE BORROWER SHALL REPAY TO THE
ADMINISTRATIVE AGENT FOR THE RATABLE ACCOUNT OF THE REVOLVING CREDIT LENDERS ON
THE MATURITY DATE FOR THE REVOLVING CREDIT FACILITY THE AGGREGATE PRINCIPAL
AMOUNT OF ALL REVOLVING CREDIT LOANS OUTSTANDING ON SUCH DATE.

 

(D)           SWING LINE LOANS.  THE BORROWER SHALL REPAY EACH SWING LINE LOAN
ON THE EARLIER TO OCCUR OF (I) THE DATE THIRTY DAYS AFTER SUCH LOAN IS MADE AND
(II) THE MATURITY DATE.

 

2.08         Interest.  (a)  Subject to the provisions of Section 2.08(b), (i)
each Eurodollar Rate Loan shall bear interest on the outstanding principal
amount thereof for each Interest Period at a rate per annum equal to the
Eurodollar Rate for such Interest Period plus the Applicable Rate; (ii) each
Canadian Term Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Screen Rate
for such Interest Period plus the Applicable Rate; (iii) each Base Rate Loan
shall bear interest on the outstanding principal amount thereof from the
applicable borrowing date at a rate per annum equal to the Base Rate plus the
Applicable Rate; and (iv) each Swing Line Loan shall bear interest on the
outstanding principal amount thereof from the applicable borrowing date at a
rate per annum equal to the Base Rate plus the Applicable Rate.

 

(B)           (I)  WHILE ANY EVENT OF DEFAULT OF THE TYPE SPECIFIED IN SECTION
8.01(A) OR SECTION 8.01(F) EXISTS, THE BORROWER SHALL PAY INTEREST ON THE
PRINCIPAL AMOUNT OF ALL OUTSTANDING OBLIGATIONS HEREUNDER AT A FLUCTUATING
INTEREST RATE PER ANNUM AT ALL TIMES EQUAL TO THE DEFAULT RATE TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAWS.

 

(II)           ACCRUED AND UNPAID INTEREST ON PAST DUE AMOUNTS (INCLUDING
INTEREST ON PAST DUE INTEREST) SHALL BE DUE AND PAYABLE UPON DEMAND.

 

(C)           INTEREST ON EACH LOAN SHALL BE DUE AND PAYABLE IN ARREARS ON EACH
INTEREST PAYMENT DATE APPLICABLE THERETO AND AT SUCH OTHER TIMES AS MAY BE
SPECIFIED HEREIN.  INTEREST HEREUNDER SHALL BE DUE AND PAYABLE IN ACCORDANCE
WITH THE TERMS HEREOF BEFORE AND AFTER

 

63

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JUDGMENT, AND BEFORE AND AFTER THE COMMENCEMENT OF ANY PROCEEDING UNDER ANY
DEBTOR RELIEF LAW.

 

2.09         Fees.  In addition to certain fees described in Sections 2.03(i)
and (j):

 

(A)           COMMITMENT FEE.  THE BORROWER SHALL PAY TO THE ADMINISTRATIVE
AGENT FOR THE ACCOUNT OF EACH REVOLVING CREDIT LENDER IN ACCORDANCE WITH ITS PRO
RATA SHARE, A COMMITMENT FEE EQUAL TO 0.50% PER ANNUM TIMES THE ACTUAL DAILY
AMOUNT BY WHICH THE AGGREGATE REVOLVING CREDIT COMMITMENTS EXCEED THE SUM OF (I)
THE OUTSTANDING AMOUNT OF REVOLVING CREDIT LOANS AND (II) THE OUTSTANDING AMOUNT
OF L/C OBLIGATIONS; PROVIDED, HOWEVER, THAT ANY COMMITMENT FEE ACCRUED WITH
RESPECT TO ANY OF THE COMMITMENTS OF A DEFAULTING LENDER DURING THE PERIOD PRIOR
TO THE TIME SUCH LENDER BECAME A DEFAULTING LENDER AND UNPAID AT SUCH TIME SHALL
NOT BE PAYABLE BY THE BORROWER SO LONG AS SUCH LENDER SHALL BE A DEFAULTING
LENDER EXCEPT TO THE EXTENT THAT SUCH COMMITMENT FEE SHALL OTHERWISE HAVE BEEN
DUE AND PAYABLE BY THE BORROWER PRIOR TO SUCH TIME; AND PROVIDED FURTHER THAT NO
COMMITMENT FEE SHALL ACCRUE ON ANY OF THE COMMITMENTS OF A DEFAULTING LENDER SO
LONG AS SUCH LENDER SHALL BE A DEFAULTING LENDER.  THE COMMITMENT FEE SHALL
ACCRUE AT ALL TIMES DURING THE AVAILABILITY PERIOD, INCLUDING AT ANY TIME DURING
WHICH ONE OR MORE OF THE CONDITIONS IN ARTICLE IV IS NOT MET, AND SHALL BE DUE
AND PAYABLE QUARTERLY IN ARREARS ON THE LAST BUSINESS DAY OF EACH MARCH, JUNE,
SEPTEMBER AND DECEMBER, COMMENCING WITH THE FIRST SUCH DATE TO OCCUR AFTER THE
CLOSING DATE, AND ON THE MATURITY DATE FOR THE REVOLVING CREDIT FACILITY.  THE
COMMITMENT FEE SHALL BE CALCULATED QUARTERLY IN ARREARS.

 

(B)           OTHER FEES.  (I)  THE BORROWER SHALL PAY TO THE ARRANGERS AND THE
ADMINISTRATIVE AGENT FOR THEIR OWN RESPECTIVE ACCOUNTS FEES IN THE AMOUNTS AND
AT THE TIMES SPECIFIED IN THE FEE LETTER.  SUCH FEES SHALL BE FULLY EARNED WHEN
PAID AND SHALL NOT BE REFUNDABLE FOR ANY REASON WHATSOEVER.

 

(II)           THE BORROWER SHALL PAY TO THE AGENTS SUCH FEES AS SHALL HAVE BEEN
SEPARATELY AGREED UPON IN WRITING IN THE AMOUNTS AND AT THE TIMES SO SPECIFIED. 
SUCH FEES SHALL BE FULLY EARNED WHEN PAID AND SHALL NOT BE REFUNDABLE FOR ANY
REASON WHATSOEVER.

 

2.10         Computation of Interest and Fees.  All computations of interest for
Base Rate Loans when the Base Rate is determined by Bank of America’s “prime
rate” shall be made on the basis of a year of 365 or 366 days, as the case may
be, and actual days elapsed.  All other computations of fees and interest shall
be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the basis
of a 365-day year).  Interest shall accrue on each Loan for the day on which the
Loan is made, and shall not accrue on a Loan, or any portion thereof, for the
day on which the Loan or such portion is paid, provided that any Loan that is
repaid on the same day on which it is made shall, subject to Section 2.12(a),
bear interest for one day.  Each determination by the Administrative Agent of an
interest rate or fee hereunder shall be conclusive and binding for all purposes,
absent manifest error.

 

2.11         Evidence of Indebtedness.  (a)  The Credit Extensions made by each
Lender shall be evidenced by one or more accounts or records maintained by such
Lender and

 

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evidenced by one or more entries in the Register maintained by the
Administrative Agent, acting solely for purposes of Treasury Regulation Section
5f.103-1(c), as agent for the Borrower, in each case in the ordinary course of
business.  The accounts or records maintained by the Administrative Agent and
each Lender shall be prima facie evidence absent manifest error of the amount of
the Credit Extensions made by the Lenders to the Borrower and the interest and
payments thereon.  In the event of any conflict between the accounts and records
maintained by any Lender and the accounts and records of the Administrative
Agent in respect of such matters, the accounts and records of the Administrative
Agent shall control in the absence of manifest error.  Upon the request of any
Lender made through the Administrative Agent, the Borrower shall execute and
deliver to such Lender (through the Administrative Agent) a Note payable to such
Lender, which shall evidence such Lender’s Loans in addition to such accounts or
records.  Each Lender may attach schedules to its Note and endorse thereon the
date, Type (if applicable), amount and maturity of its Loans and payments with
respect thereto.

 

(B)           IN ADDITION TO THE ACCOUNTS AND RECORDS REFERRED TO IN SECTION
2.11(A), EACH LENDER AND THE ADMINISTRATIVE AGENT SHALL MAINTAIN IN ACCORDANCE
WITH ITS USUAL PRACTICE ACCOUNTS OR RECORDS AND, IN THE CASE OF THE
ADMINISTRATIVE AGENT, ENTRIES IN THE REGISTER, EVIDENCING THE PURCHASES AND
SALES BY SUCH LENDER OF PARTICIPATIONS IN LETTERS OF CREDIT AND SWING LINE
LOANS.  IN THE EVENT OF ANY CONFLICT BETWEEN THE ACCOUNTS AND RECORDS MAINTAINED
BY THE ADMINISTRATIVE AGENT AND THE ACCOUNTS AND RECORDS OF ANY LENDER IN
RESPECT OF SUCH MATTERS, THE ACCOUNTS AND RECORDS OF THE ADMINISTRATIVE AGENT
SHALL CONTROL IN THE ABSENCE OF MANIFEST ERROR.

 

(C)           ENTRIES MADE IN GOOD FAITH BY THE ADMINISTRATIVE AGENT IN THE
REGISTER PURSUANT TO SECTION 2.11(A) AND (B), AND BY EACH LENDER IN ITS ACCOUNT
OR ACCOUNTS PURSUANT TO SECTION 2.11(A), SHALL BE PRIMA FACIE EVIDENCE OF THE
AMOUNT OF PRINCIPAL AND INTEREST DUE AND PAYABLE OR TO BECOME DUE AND PAYABLE
FROM THE BORROWER TO, IN THE CASE OF THE REGISTER, EACH LENDER AND, IN THE CASE
OF SUCH ACCOUNT OR ACCOUNTS, SUCH LENDER, UNDER THIS AGREEMENT AND THE OTHER
LOAN DOCUMENTS, ABSENT MANIFEST ERROR; PROVIDED THAT THE FAILURE OF THE
ADMINISTRATIVE AGENT OR SUCH LENDER TO MAKE AN ENTRY, OR ANY FINDING THAT AN
ENTRY IS INCORRECT, IN THE REGISTER OR SUCH ACCOUNT OR ACCOUNTS SHALL NOT LIMIT
OR OTHERWISE AFFECT THE OBLIGATIONS OF THE BORROWER OR ANY LOAN PARTY UNDER THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS.

 

2.12         Payments Generally.  (a)  All payments to be made by the Borrower
shall be made without condition or deduction for any counterclaim, defense,
recoupment or setoff.  Except with respect to the Canadian Term Loans or as
otherwise expressly provided herein, all payments by the Borrower hereunder
shall be made to the Administrative Agent, for the account of the respective
Lenders to which such payment is owed, at the Administrative Agent’s Office in
Dollars and in immediately available funds not later than 2:00 p.m. on the date
specified herein.  All payments by the Borrower hereunder with respect to the
Canadian Term Loans shall be made to the Administrative Agent, for the account
of the respective Canadian Term Lenders to which such payment is owed, at the
Administrative Agent’s Office in Canadian Dollars and in immediately available
funds not later than 2:00 p.m. on the date specified herein.  The Administrative
Agent will promptly distribute to each Lender its Pro Rata Share (or other
applicable share as provided herein) of such payment in like funds as received
by wire transfer to such Lender’s Lending Office.  All payments received by the
Administrative Agent after 2:00

 

65

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

 

p.m. shall be deemed received on the next succeeding Business Day and any
applicable interest or fee shall continue to accrue.

 

(B)           IF ANY PAYMENT TO BE MADE BY THE BORROWER SHALL COME DUE ON A DAY
OTHER THAN A BUSINESS DAY, PAYMENT SHALL BE MADE ON THE NEXT FOLLOWING BUSINESS
DAY, AND SUCH EXTENSION OF TIME SHALL BE REFLECTED IN COMPUTING INTEREST OR
FEES, AS THE CASE MAY BE; PROVIDED, HOWEVER, THAT, IF SUCH EXTENSION WOULD CAUSE
PAYMENT OF INTEREST ON OR PRINCIPAL OF EURODOLLAR RATE LOANS OR SCREEN RATE
LOANS TO BE MADE IN THE NEXT SUCCEEDING CALENDAR MONTH, SUCH PAYMENT SHALL BE
MADE ON THE IMMEDIATELY PRECEDING BUSINESS DAY.

 

(C)           UNLESS THE BORROWER OR ANY LENDER HAS NOTIFIED THE ADMINISTRATIVE
AGENT, PRIOR TO THE DATE ANY PAYMENT IS REQUIRED TO BE MADE BY IT TO THE
ADMINISTRATIVE AGENT HEREUNDER, THAT THE BORROWER OR SUCH LENDER, AS THE CASE
MAY BE, WILL NOT MAKE SUCH PAYMENT, THE ADMINISTRATIVE AGENT MAY ASSUME THAT THE
BORROWER OR SUCH LENDER, AS THE CASE MAY BE, HAS TIMELY MADE SUCH PAYMENT AND
MAY (BUT SHALL NOT BE SO REQUIRED TO), IN RELIANCE THEREON, MAKE AVAILABLE A
CORRESPONDING AMOUNT TO THE PERSON ENTITLED THERETO.  IF AND TO THE EXTENT THAT
SUCH PAYMENT WAS NOT IN FACT MADE TO THE ADMINISTRATIVE AGENT IN IMMEDIATELY
AVAILABLE FUNDS, THEN:

 

(I)            IF THE BORROWER FAILED TO MAKE SUCH PAYMENT, EACH LENDER SHALL
FORTHWITH ON DEMAND REPAY TO THE ADMINISTRATIVE AGENT THE PORTION OF SUCH
ASSUMED PAYMENT THAT WAS MADE AVAILABLE TO SUCH LENDER IN IMMEDIATELY AVAILABLE
FUNDS, TOGETHER WITH INTEREST THEREON IN RESPECT OF EACH DAY FROM AND INCLUDING
THE DATE SUCH AMOUNT WAS MADE AVAILABLE BY THE ADMINISTRATIVE AGENT TO SUCH
LENDER TO THE DATE SUCH AMOUNT IS REPAID TO THE ADMINISTRATIVE AGENT IN
IMMEDIATELY AVAILABLE FUNDS AT THE FEDERAL FUNDS RATE FROM TIME TO TIME IN
EFFECT; AND

 

(II)           IF ANY LENDER FAILED TO MAKE SUCH PAYMENT, SUCH LENDER SHALL
FORTHWITH ON DEMAND PAY TO THE ADMINISTRATIVE AGENT THE AMOUNT THEREOF IN
IMMEDIATELY AVAILABLE FUNDS, TOGETHER WITH INTEREST THEREON FOR THE PERIOD FROM
THE DATE SUCH AMOUNT WAS MADE AVAILABLE BY THE ADMINISTRATIVE AGENT TO THE
BORROWER TO THE DATE SUCH AMOUNT IS RECOVERED BY THE ADMINISTRATIVE AGENT (THE
“COMPENSATION PERIOD”) AT A RATE PER ANNUM EQUAL TO THE FEDERAL FUNDS RATE FROM
TIME TO TIME IN EFFECT.  IF SUCH LENDER PAYS SUCH AMOUNT TO THE ADMINISTRATIVE
AGENT, THEN SUCH AMOUNT SHALL CONSTITUTE SUCH LENDER’S LOAN INCLUDED IN THE
APPLICABLE BORROWING.  IF SUCH LENDER DOES NOT PAY SUCH AMOUNT FORTHWITH UPON
THE ADMINISTRATIVE AGENT’S DEMAND THEREFOR, THE ADMINISTRATIVE AGENT MAY MAKE A
DEMAND THEREFOR UPON THE BORROWER, AND THE BORROWER SHALL PAY SUCH AMOUNT TO THE
ADMINISTRATIVE AGENT, TOGETHER WITH INTEREST THEREON FOR THE COMPENSATION PERIOD
AT A RATE PER ANNUM EQUAL TO THE RATE OF INTEREST APPLICABLE TO THE APPLICABLE
BORROWING.  NOTHING HEREIN SHALL BE DEEMED TO RELIEVE ANY LENDER FROM ITS
OBLIGATION TO FULFILL ITS COMMITMENT OR TO PREJUDICE ANY RIGHTS WHICH THE
ADMINISTRATIVE AGENT OR THE BORROWER MAY HAVE AGAINST ANY LENDER AS A RESULT OF
ANY DEFAULT BY SUCH LENDER HEREUNDER.

 

A notice of the Administrative Agent to any Lender or the Borrower with respect
to any amount owing under this Section 2.12(c) shall be conclusive, absent
manifest error.

 

66

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

 

(D)           IF ANY LENDER MAKES AVAILABLE TO THE ADMINISTRATIVE AGENT FUNDS
FOR ANY LOAN TO BE MADE BY SUCH LENDER AS PROVIDED IN THE FOREGOING PROVISIONS
OF THIS ARTICLE II, AND SUCH FUNDS ARE NOT MADE AVAILABLE TO THE BORROWER BY THE
ADMINISTRATIVE AGENT BECAUSE THE CONDITIONS TO THE APPLICABLE CREDIT EXTENSION
SET FORTH IN ARTICLE IV ARE NOT SATISFIED OR WAIVED IN ACCORDANCE WITH THE TERMS
HEREOF, THE ADMINISTRATIVE AGENT SHALL RETURN SUCH FUNDS (IN LIKE FUNDS AS
RECEIVED FROM SUCH LENDER) TO SUCH LENDER, WITHOUT INTEREST.

 

(E)           THE OBLIGATIONS OF THE LENDERS HEREUNDER TO MAKE LOANS AND TO FUND
PARTICIPATIONS IN LETTERS OF CREDIT AND SWING LINE LOANS ARE SEVERAL AND NOT
JOINT.  THE FAILURE OF ANY LENDER TO MAKE ANY LOAN OR TO FUND ANY SUCH
PARTICIPATION ON ANY DATE REQUIRED HEREUNDER SHALL NOT RELIEVE ANY OTHER LENDER
OF ITS CORRESPONDING OBLIGATION TO DO SO ON SUCH DATE, AND NO LENDER SHALL BE
RESPONSIBLE FOR THE FAILURE OF ANY OTHER LENDER TO SO MAKE ITS LOAN OR PURCHASE
ITS PARTICIPATION.

 

(F)            NOTHING HEREIN SHALL BE DEEMED TO OBLIGATE ANY LENDER TO OBTAIN
THE FUNDS FOR ANY LOAN IN ANY PARTICULAR PLACE OR MANNER OR TO CONSTITUTE A
REPRESENTATION BY ANY LENDER THAT IT HAS OBTAINED OR WILL OBTAIN THE FUNDS FOR
ANY LOAN IN ANY PARTICULAR PLACE OR MANNER.

 

(G)           WHENEVER ANY PAYMENT RECEIVED BY THE ADMINISTRATIVE AGENT UNDER
THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS IS INSUFFICIENT TO PAY IN FULL
ALL AMOUNTS DUE AND PAYABLE TO THE AGENTS AND THE LENDERS UNDER OR IN RESPECT OF
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS ON ANY DATE, SUCH PAYMENT SHALL BE
DISTRIBUTED BY THE ADMINISTRATIVE AGENT AND APPLIED BY THE AGENTS AND THE
LENDERS IN THE ORDER OF PRIORITY SET FORTH IN SECTION 8.03.  IF THE
ADMINISTRATIVE AGENT RECEIVES FUNDS FOR APPLICATION TO THE OBLIGATIONS OF THE
LOAN PARTIES UNDER OR IN RESPECT OF THE LOAN DOCUMENTS UNDER CIRCUMSTANCES FOR
WHICH THE LOAN DOCUMENTS DO NOT SPECIFY THE MANNER IN WHICH SUCH FUNDS ARE TO BE
APPLIED, THE ADMINISTRATIVE AGENT MAY, BUT SHALL NOT BE OBLIGATED TO, ELECT TO
DISTRIBUTE SUCH FUNDS TO EACH OF THE LENDERS IN ACCORDANCE WITH SUCH LENDER’S
PRO RATA SHARE OF THE SUM OF (I) THE OUTSTANDING AMOUNT OF ALL LOANS OUTSTANDING
AT SUCH TIME AND (II) THE OUTSTANDING AMOUNT OF ALL L/C OBLIGATIONS OUTSTANDING
AT SUCH TIME, IN REPAYMENT OR PREPAYMENT OF SUCH OF THE OUTSTANDING LOANS OR
OTHER OBLIGATIONS THEN OWING TO SUCH LENDER.

 

2.13         Sharing of Payments.  If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans made by it, or
the participations in L/C Obligations or in Swing Line Loans held by it, any
payment (whether voluntary, involuntary, through the exercise of any right of
setoff, or otherwise) in excess of its ratable share (or other share
contemplated hereunder) thereof, such Lender shall immediately (a) notify the
Administrative Agent of such fact, and (b) purchase from the other Lenders such
participations in the Loans made by them and/or such subparticipations in the
participations in L/C Obligations or Swing Line Loans held by them, as the case
may be, as shall be necessary to cause such purchasing Lender to share the
excess payment in respect of such Loans or such participations, as the case may
be, pro rata with each of them; provided, however, that if all or any portion of
such excess payment is thereafter recovered from the purchasing Lender under any
of the circumstances described in Section 10.06 (including pursuant to any
settlement entered into by the purchasing Lender in its discretion), such
purchase shall to that extent be rescinded and each other Lender shall repay to
the purchasing Lender the purchase price paid therefor, together with an amount
equal to such paying Lender’s ratable share (according to the proportion of (i)
the

 

67

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

 

amount of such paying Lender’s required repayment to (ii) the total amount so
recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered,
without further interest thereon.  The Borrower agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
setoff, but subject to Section 10.09) with respect to such participation as
fully as if such Lender were the direct creditor of the Borrower in the amount
of such participation; provided further that, so long as the Obligations under
the Loan Documents shall not have been accelerated, any excess payment received
by any Appropriate Lender shall be shared on a pro rata basis only with other
Appropriate Lenders.  The Administrative Agent will keep records (which shall be
conclusive and binding in the absence of manifest error) of participations
purchased under this Section and will in each case notify the Lenders following
any such purchases or repayments.  Each Lender that purchases a participation
pursuant to this Section shall from and after such purchase have the right to
give all notices, requests, demands, directions and other communications under
this Agreement with respect to the portion of the Obligations purchased to the
same extent as though the purchasing Lender were the original owner of the
Obligations purchased.

 

2.14         Increase in Commitments.  (a)  Provided there exists no Event of
Default after giving effect to any such increase, upon notice to the
Administrative Agent (which shall promptly notify the Lenders), the Borrower may
from time to time, request an increase in the Term Commitments or Revolving
Credit Commitments by an amount (for all such requests) not exceeding
$100,000,000.  Each such request shall be for an increase of not less than
$10,000,000.  At the time of sending such notice, the Borrower (in consultation
with the Administrative Agent) shall specify the time period within which each
Lender is requested to respond (which shall in no event be less than ten
Business Days from the date of delivery of such notice to the Lenders).  Each
Lender shall notify the Administrative Agent within such time period whether or
not it agrees to increase its Term Commitment or Revolving Credit Commitment
and, if so, whether by an amount equal to, greater than, or less than its Pro
Rata Share of such requested increase.  Any Lender not responding within such
time period shall be deemed to have declined to increase its Commitment.  The
Administrative Agent shall notify the Borrower and each Lender of the Lenders’
responses to each request made hereunder.  To achieve the full amount of a
requested increase, the Borrower may also invite additional Eligible Assignees
to become Lenders pursuant to a joinder agreement in form and substance
reasonably satisfactory to the Administrative Agent and its counsel.

 

(B)           IF THE TERM COMMITMENTS AND/OR REVOLVING CREDIT COMMITMENTS ARE
INCREASED IN ACCORDANCE WITH THIS SECTION, THE ADMINISTRATIVE AGENT AND THE
BORROWER SHALL DETERMINE THE CLOSING DATE (THE “INCREASE EFFECTIVE DATE”) AND
THE FINAL ALLOCATION OF SUCH INCREASE.  THE ADMINISTRATIVE AGENT SHALL PROMPTLY
NOTIFY THE BORROWER AND THE LENDERS OF THE FINAL ALLOCATION OF SUCH INCREASE AND
THE INCREASE EFFECTIVE DATE.  AS A CONDITION PRECEDENT TO SUCH INCREASE, THE
BORROWER SHALL DELIVER TO THE ADMINISTRATIVE AGENT A CERTIFICATE OF EACH LOAN
PARTY DATED AS OF THE INCREASE EFFECTIVE DATE SIGNED BY A RESPONSIBLE OFFICER OF
SUCH LOAN PARTY (I) CERTIFYING AND ATTACHING THE RESOLUTIONS ADOPTED BY SUCH
LOAN PARTY APPROVING OR CONSENTING TO SUCH INCREASE, AND (II) IN THE CASE OF THE
BORROWER, CERTIFYING THAT, BEFORE AND AFTER GIVING EFFECT TO SUCH INCREASE, (A)
THE REPRESENTATIONS AND WARRANTIES CONTAINED IN ARTICLE V AND THE OTHER LOAN
DOCUMENTS ARE TRUE AND CORRECT IN ALL MATERIAL RESPECTS ON AND AS OF THE
INCREASE EFFECTIVE DATE, EXCEPT TO THE EXTENT THAT SUCH REPRESENTATIONS AND
WARRANTIES SPECIFICALLY REFER TO

 

68

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AN EARLIER DATE, IN WHICH CASE THEY ARE TRUE AND CORRECT IN ALL MATERIAL
RESPECTS AS OF SUCH EARLIER DATE, AND EXCEPT THAT FOR PURPOSES OF THIS SECTION
2.14, THE REPRESENTATIONS AND WARRANTIES CONTAINED IN SECTION 5.06 AND 5.07
SHALL BE DEEMED TO REFER TO THE MOST RECENT STATEMENTS FURNISHED PURSUANT TO
SUBSECTIONS (B) AND (C), RESPECTIVELY, OF SECTION 6.13, AND (B) NO EVENT OF
DEFAULT EXISTS, AFTER GIVING EFFECT TO ANY SUCH INCREASE.

 

(C)           TO THE EXTENT THE COMMITMENT BEING INCREASED ON THE RELEVANT
INCREASE EFFECTIVE DATE IS A TERM COMMITMENT, THEN EACH OF THE LENDERS HAVING AN
TERM LOAN PRIOR TO SUCH INCREASE EFFECTIVE DATE (THE “PRE-INCREASE TERM
LENDERS”) SHALL ASSIGN TO ANY LENDER MAKING AN ADDITIONAL TERM LOAN ON THE
INCREASE EFFECTIVE DATE (THE “POST-INCREASE TERM LENDERS”), AND SUCH
POST-INCREASE TERM LENDERS SHALL PURCHASE FROM EACH PRE-INCREASE TERM LENDERS,
AT THE PRINCIPAL AMOUNT THEREOF, SUCH INTERESTS IN THE TERM LOANS OUTSTANDING ON
SUCH INCREASE EFFECTIVE DATE AS SHALL BE NECESSARY IN ORDER THAT, AFTER GIVING
EFFECT TO ALL SUCH ASSIGNMENTS AND PURCHASES, SUCH TERM LOANS WILL BE HELD BY
PRE-INCREASE TERM LENDERS AND POST-INCREASE TERM LENDERS RATABLY IN ACCORDANCE
WITH THE OUTSTANDING AMOUNT OF TERM LOANS AND INCREASED TERM COMMITMENTS AFTER
GIVING EFFECT TO SUCH INCREASED TERM COMMITMENTS.  TO THE EXTENT THE COMMITMENT
BEING INCREASED ON THE RELEVANT INCREASE EFFECTIVE DATE IS A REVOLVING CREDIT
COMMITMENT, THEN EACH OF THE LENDERS HAVING A REVOLVING CREDIT COMMITMENT PRIOR
TO SUCH INCREASE EFFECTIVE DATE (THE “PRE-INCREASE REVOLVING LENDERS”) SHALL
ASSIGN TO ANY LENDER WHICH IS ACQUIRING A NEW OR ADDITIONAL REVOLVING CREDIT
COMMITMENT ON THE INCREASE EFFECTIVE DATE (THE “POST-INCREASE REVOLVING
LENDERS”), AND SUCH POST-INCREASE REVOLVING LENDERS SHALL PURCHASE FROM EACH
PRE-INCREASE REVOLVING LENDERS, AT THE PRINCIPAL AMOUNT THEREOF, SUCH INTERESTS
IN THE REVOLVING LOANS AND PARTICIPATION INTERESTS IN L/C OBLIGATIONS AND SWING
LINE LOANS OUTSTANDING ON SUCH INCREASE EFFECTIVE DATE AS SHALL BE NECESSARY IN
ORDER THAT, AFTER GIVING EFFECT TO ALL SUCH ASSIGNMENTS AND PURCHASES, SUCH
REVOLVING LOANS AND PARTICIPATION INTERESTS IN L/C OBLIGATIONS AND SWING LINE
LOANS WILL BE HELD BY PRE-INCREASE REVOLVING LENDERS AND POST-INCREASE REVOLVING
LENDERS RATABLY IN ACCORDANCE WITH THEIR REVOLVING CREDIT COMMITMENTS AFTER
GIVING EFFECT TO SUCH INCREASED REVOLVING CREDIT COMMITMENTS.

 

(D)           THIS SECTION SHALL SUPERSEDE ANY PROVISIONS IN SECTIONS 2.13 OR
10.01 TO THE CONTRARY.

 

2.15         Use of Proceeds.  The proceeds of the Loans shall be available, and
the Borrower hereby agrees that it shall use such proceeds, solely (a) to
finance the Nu-Gro Acquisition, (b) to pay certain fees and expenses incurred in
connection with the Nu-Gro Transaction, (c) to finance the Preferred Stock
Redemption, (d) to refinance the commitments and outstanding amounts under the
Existing Credit Facility, (e) to refinance certain existing Indebtedness of
Nu-Gro and its Subsidiaries, (f) pay certain fees and expenses incurred in
connection with the Preferred Stock Redemption and (g) to provide working
capital to, and for other general purposes of, the Borrower and its Subsidiaries
not otherwise prohibited under the terms of the Loan Documents.

 

ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01         Taxes.  (a)  Except as provided in this Section 3.01, any and all
payments

 

69

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by the Borrower to or for the account of any Agent or any Lender under any Loan
Document shall be made free and clear of and without deduction for any and all
present or future taxes, duties, levies, imposts, deductions, assessments, fees,
withholdings or similar charges, and all liabilities (including additions to
tax, penalties and interest) with respect thereto, excluding, in the case of
each Agent and each Lender, taxes imposed on or measured by its overall net
income or overall gross income (including branch profits), and franchise (and
similar) taxes imposed on it in lieu of net income taxes, by the jurisdiction
(or any political subdivision thereof) under the Laws of which such Agent or
such Lender, as the case may be, is organized, has its principal place of
business or maintains a Lending Office, and all liabilities (including additions
to tax, penalties and interest) with respect thereto (all such non-excluded
taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or
similar charges, and liabilities being hereinafter referred to as “Taxes”).  If
the Borrower shall be required by any Laws to deduct any Taxes from or in
respect of any sum payable under any Loan Document to any Agent or any Lender,
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section), each of such Agent and such Lender receives an amount equal
to the sum it would have received had no such deductions been made, (ii) the
Borrower shall make such deductions, (iii) the Borrower shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable Laws, and (iv) within 30 days after the date of such
payment, the Borrower shall furnish to such Agent or Lender (as the case may be)
the original or a certified copy of a receipt evidencing payment thereof to the
extent such a receipt is issued therefor, or other written proof of payment
thereof that is reasonably satisfactory to the Administrative Agent.

 

(B)           IN ADDITION, THE BORROWER AGREES TO PAY ANY AND ALL PRESENT OR
FUTURE STAMP, COURT OR DOCUMENTARY TAXES AND ANY OTHER EXCISE, PROPERTY,
INTANGIBLE OR MORTGAGE RECORDING TAXES OR CHARGES OR SIMILAR LEVIES WHICH ARISE
FROM ANY PAYMENT MADE UNDER ANY LOAN DOCUMENT OR FROM THE EXECUTION, DELIVERY,
PERFORMANCE, ENFORCEMENT OR REGISTRATION OF, OR OTHERWISE WITH RESPECT TO, ANY
LOAN DOCUMENT (HEREINAFTER REFERRED TO AS “OTHER TAXES”).

 

(C)           THE BORROWER AGREES TO INDEMNIFY EACH AGENT AND EACH LENDER FOR
(I) THE FULL AMOUNT OF TAXES AND OTHER TAXES (INCLUDING ANY TAXES OR OTHER TAXES
IMPOSED OR ASSERTED BY ANY JURISDICTION ON AMOUNTS PAYABLE UNDER THIS SECTION)
PAID BY SUCH AGENT AND SUCH LENDER AND (II) ANY LIABILITY (INCLUDING ADDITIONS
TO TAX, PENALTIES, INTEREST AND EXPENSES) ARISING THEREFROM OR WITH RESPECT
THERETO, IN EACH CASE WHETHER OR NOT SUCH TAXES OR OTHER TAXES WERE CORRECTLY OR
LEGALLY IMPOSED OR ASSERTED BY THE RELEVANT GOVERNMENTAL AUTHORITY; PROVIDED
SUCH AGENT OR LENDER, AS THE CASE MAY BE, PROVIDES THE BORROWER WITH A WRITTEN
STATEMENT THEREOF SETTING FORTH IN REASONABLE DETAIL THE BASIS AND CALCULATION
OF SUCH AMOUNTS.  PAYMENT UNDER THIS SECTION 3.01(C) SHALL BE MADE WITHIN 30
DAYS AFTER THE DATE SUCH LENDER OR SUCH AGENT MAKES A DEMAND THEREFOR.

 

(D)           THE BORROWER SHALL NOT BE REQUIRED PURSUANT TO THIS SECTION 3.01
TO PAY ANY ADDITIONAL AMOUNT TO, OR TO INDEMNIFY, ANY LENDER OR AGENT, AS THE
CASE MAY BE, TO THE EXTENT THAT SUCH LENDER OR SUCH AGENT BECOMES SUBJECT TO
TAXES SUBSEQUENT TO THE CLOSING DATE (OR, IF LATER, THE DATE SUCH LENDER OR
AGENT BECOMES A PARTY TO THIS AGREEMENT) AS A RESULT OF A CHANGE IN THE PLACE OF
ORGANIZATION OF SUCH LENDER OR AGENT OR A CHANGE IN THE LENDING OFFICE OF SUCH
LENDER, EXCEPT TO THE EXTENT THAT ANY SUCH CHANGE IS REQUESTED OR REQUIRED BY
THE BORROWER (AND PROVIDED, THAT NOTHING IN THIS CLAUSE (D) SHALL BE CONSTRUED
AS RELIEVING THE BORROWER FROM ANY

 

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OBLIGATION TO MAKE SUCH PAYMENTS OR INDEMNIFICATION IN THE EVENT OF A CHANGE
THAT IS A CHANGE IN LAW).

 

(E)           IF THE FORMS PROVIDED BY A LENDER OR AN AGENT PURSUANT TO
SECTION 10.15(A) AT THE TIME SUCH LENDER OR SUCH AGENT, AS THE CASE MAY BE,
FIRST BECOMES A PARTY TO THIS AGREEMENT AT THE BORROWER’S DISCRETION PURSUANT TO
SECTION 10.07(G) INDICATE A UNITED STATES WITHHOLDING TAX RATE IN EXCESS OF ZERO
(THE “ACTUAL RATE”), WITHHOLDING TAX IN EXCESS OF THE ACTUAL RATE SHALL BE
CONSIDERED EXCLUDED FROM TAXES UNLESS AND UNTIL SUCH LENDER OR AGENT, AS THE
CASE MAY BE, PROVIDES THE APPROPRIATE FORMS CERTIFYING THAT A LESSER RATE
APPLIES, WHEREUPON WITHHOLDING TAX AT SUCH LESSER RATE ONLY SHALL BE CONSIDERED
EXCLUDED FROM TAXES FOR PERIODS GOVERNED BY SUCH FORMS; PROVIDED, HOWEVER, THAT,
IF AT THE DATE OF THE ASSIGNMENT AND ACCEPTANCE PURSUANT TO WHICH A LENDER
BECOMES A PARTY TO THIS AGREEMENT, THE LENDER ASSIGNOR WAS ENTITLED TO PAYMENTS
UNDER CLAUSE (A) OF THIS SECTION 3.01 IN RESPECT OF UNITED STATES WITHHOLDING
TAX WITH RESPECT TO INTEREST PAID AT SUCH DATE, THEN, TO SUCH EXTENT, THE TERM
TAXES SHALL INCLUDE (IN ADDITION TO WITHHOLDING TAXES THAT MAY BE IMPOSED IN THE
FUTURE OR OTHER AMOUNTS OTHERWISE INCLUDABLE IN TAXES) UNITED STATES WITHHOLDING
TAX, IF ANY, APPLICABLE WITH RESPECT TO THE LENDER ASSIGNEE ON SUCH DATE.

 

(F)            IF ANY LENDER OR AGENT DETERMINES THAT IT HAS RECEIVED A REFUND
IN RESPECT OF ANY TAXES OR OTHER TAXES AS TO WHICH INDEMNIFICATION OR ADDITIONAL
AMOUNTS HAVE BEEN PAID TO IT BY THE BORROWER PURSUANT TO THIS SECTION 3.01, IT
SHALL PROMPTLY REMIT SUCH REFUND (INCLUDING ANY INTEREST INCLUDED IN SUCH
REFUND) TO THE BORROWER (TO THE EXTENT THAT IT DETERMINES THAT IT CAN DO SO
WITHOUT PREJUDICE TO THE RETENTION OF THE REFUND), NET OF ALL OUT-OF-POCKET
EXPENSES OF THE LENDER OR AGENT, AS THE CASE MAY BE; PROVIDED, HOWEVER, THAT THE
BORROWER, UPON THE REQUEST OF THE LENDER OR AGENT, AS THE CASE MAY BE, AGREES
PROMPTLY TO RETURN SUCH REFUND TO SUCH PARTY IN THE EVENT SUCH PARTY IS REQUIRED
TO REPAY SUCH REFUND TO THE RELEVANT TAXING AUTHORITY.  SUCH LENDER OR AGENT, AS
THE CASE MAY BE, SHALL, AT THE BORROWER’S REQUEST, PROVIDE THE BORROWER WITH A
COPY OF ANY NOTICE OF ASSESSMENT OR OTHER EVIDENCE OF THE REQUIREMENT TO REPAY
SUCH REFUND RECEIVED FROM THE RELEVANT TAXING AUTHORITY (PROVIDED, THAT SUCH
LENDER OR AGENT MAY DELETE ANY INFORMATION THEREIN THAT SUCH LENDER OR AGENT
DEEMS CONFIDENTIAL).  NOTHING HEREIN CONTAINED SHALL INTERFERE WITH THE RIGHT OF
A LENDER OR AGENT TO ARRANGE ITS TAX AFFAIRS IN WHATEVER MANNER IT THINKS FIT
NOR OBLIGE ANY LENDER OR AGENT TO CLAIM ANY TAX REFUND OR TO DISCLOSE ANY
INFORMATION RELATING TO ITS TAX AFFAIRS OR ANY COMPUTATIONS IN RESPECT THEREOF
OR REQUIRE ANY LENDER OR AGENT TO DO ANYTHING THAT WOULD PREJUDICE ITS ABILITY
TO BENEFIT FROM ANY OTHER REFUNDS, CREDITS, RELIEFS, REMISSIONS OR REPAYMENTS TO
WHICH IT MAY BE ENTITLED.

 

(G)           EACH LENDER AGREES THAT, UPON THE OCCURRENCE OF ANY EVENT GIVING
RISE TO THE OPERATION OF SECTION 3.01(A) OR (C) WITH RESPECT TO SUCH LENDER IT
WILL, IF REQUESTED BY THE BORROWER, USE COMMERCIALLY REASONABLE EFFORTS (SUBJECT
TO SUCH LENDER’S OVERALL INTERNAL POLICIES OF GENERAL APPLICATION AND LEGAL AND
REGULATORY RESTRICTIONS) TO AVOID THE CONSEQUENCES OF SUCH EVENT, INCLUDING TO
DESIGNATE ANOTHER LENDING OFFICE FOR ANY LOAN OR LETTER OF CREDIT AFFECTED BY
SUCH EVENT; PROVIDED, THAT SUCH EFFORTS ARE MADE ON TERMS THAT, IN THE
REASONABLE JUDGMENT OF SUCH LENDER, CAUSE SUCH LENDER AND ITS LENDING OFFICE(S)
TO SUFFER NO MATERIAL ECONOMIC, LEGAL OR REGULATORY DISADVANTAGE, AND PROVIDED,
FURTHER, THAT NOTHING IN THIS SECTION 3.01(G) SHALL AFFECT OR POSTPONE ANY OF
THE OBLIGATIONS OF THE BORROWER OR THE RIGHTS OF SUCH LENDER PURSUANT TO
SECTIONS 3.01(A) AND (C).

 

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(H)           NOTWITHSTANDING ANY PROVISION CONTAINED HEREIN TO THE CONTRARY,
ANY INDEMNITY WITH RESPECT TO TAXES, DUTIES, LEVIES, IMPOSTS, DEDUCTIONS,
ASSESSMENTS, FEES, WITHHOLDINGS OR SIMILAR CHARGES IMPOSED BY ANY GOVERNMENTAL
AUTHORITY, OR ANY LIABILITIES WITH RESPECT THERETO, SHALL BE GOVERNED SOLELY AND
EXCLUSIVELY BY THIS SECTION 3.01 AND SECTION 10.15.

 

3.02         Illegality.  If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurodollar Rate Loans or Screen Rate Loans, or to determine or charge interest
rates based upon the Eurodollar Rate or Screen Rate, then, on notice thereof by
such Lender to the Borrower through the Administrative Agent, any obligation of
such Lender to make or continue Eurodollar Rate Loans or Screen Rate Loans or to
convert Base Rate Loans to Eurodollar Rate Loans shall be suspended until such
Lender notifies the Administrative Agent and the Borrower that the circumstances
giving rise to such determination no longer exist.  Upon receipt of such notice,
the Borrower shall, upon demand from such Lender (with a copy to the
Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate
Loans of such Lender to Base Rate Loans, either on the last day of the Interest
Period therefor, if such Lender may lawfully continue to maintain such
Eurodollar Rate Loans or Screen Rate Loans to such day, or immediately, if such
Lender may not lawfully continue to maintain such Eurodollar Rate Loans or
Screen Rate Loans.  Upon any such prepayment or conversion, the Borrower shall
also pay accrued interest on the amount so prepaid or converted.  Each Lender
agrees to designate a different Lending Office if such designation will avoid
the need for such notice and will not, in the good faith judgment of such
Lender, otherwise be materially disadvantageous to such Lender.

 

3.03         Inability to Determine Rates.  If the Required Lenders determine
that for any reason adequate and reasonable means do not exist for determining
the LIBO Rate or Screen Rate, as applicable, for any requested Interest Period
with respect to a proposed Eurodollar Rate Loan or Screen Rate Loan, or that the
LIBO Rate or Screen Rate for any requested Interest Period with respect to a
proposed Eurodollar Rate Loan or Screen Rate Loan does not adequately and fairly
reflect the cost to such Lenders of funding such Loan, or that Dollar deposits
are not being offered to banks in the London interbank eurodollar or Canadian
Dollar market for the applicable amount and the Interest Period of such
Eurodollar Rate Loan or Screen Rate Loan, the Administrative Agent will promptly
so notify the Borrower and each Lender.  Thereafter, the obligation of the
Lenders to make or maintain Eurodollar Rate Loans or Screen Rate Loans, as
applicable, shall be suspended until the Administrative Agent (upon the
instruction of the Required Lenders) revokes such notice.  Upon receipt of such
notice, the Borrower may revoke any pending request for a Borrowing of,
conversion to or continuation of Eurodollar Rate Loans or Screen Rate Loans or,
failing that, with respect to Eurodollar Rate Loans, will be deemed to have
converted such request into a request for a Committed Borrowing of Base Rate
Loans in the amount specified therein.

 

3.04         Increased Cost and Reduced Return; Capital Adequacy.  (a)  If any
Lender determines that as a result of the introduction of or any change in or in
the interpretation of any Law, in each case after the date hereof, or such
Lender’s compliance therewith, there shall be any increase in the cost to such
Lender of agreeing to make or making, funding or maintaining Eurodollar Rate
Loans or Screen Rate Loan (as the case may be) or issuing or participating in
Letters of Credit, or a reduction in the amount received or receivable by such
Lender in

 

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connection with any of the foregoing (excluding for purposes of this Section
3.04(a) any such increased costs or reduction in amount resulting from (i) Taxes
or Other Taxes (as to which Section 3.01 shall govern), (ii) changes in the
basis of taxation of overall net income or overall gross income (including
branch profits), and franchise (and similar) taxes imposed in lieu of net income
taxes, by the United States or any foreign jurisdiction or any political
subdivision of either thereof under the Laws of which such Lender is organized
or maintains a Lending Office, and (iii) reserve requirements utilized in the
determination of the Eurodollar Rate or Screen Rate), then from time to time
upon demand of such Lender setting forth in reasonable detail such increased
costs (with a copy of such demand to the Administrative Agent given in
accordance with Section 3.06), the Borrower shall pay to such Lender such
additional amounts as will compensate such Lender for such increased cost or
reduction.

 

(B)           IF ANY LENDER DETERMINES THAT THE INTRODUCTION OF ANY LAW
REGARDING CAPITAL ADEQUACY OR ANY CHANGE THEREIN OR IN THE INTERPRETATION
THEREOF, IN EACH CASE AFTER THE DATE HEREOF, OR COMPLIANCE BY SUCH LENDER (OR
ITS LENDING OFFICE) THEREWITH, HAS THE EFFECT OF REDUCING THE RATE OF RETURN ON
THE CAPITAL OF SUCH LENDER OR ANY CORPORATION CONTROLLING SUCH LENDER AS A
CONSEQUENCE OF SUCH LENDER’S OBLIGATIONS HEREUNDER (TAKING INTO CONSIDERATION
ITS POLICIES WITH RESPECT TO CAPITAL ADEQUACY AND SUCH LENDER’S DESIRED RETURN
ON CAPITAL), THEN FROM TIME TO TIME UPON DEMAND OF SUCH LENDER SETTING FORTH IN
REASONABLE DETAIL THE CHARGE AND THE CALCULATION OF SUCH REDUCED RATE OF RETURN
(WITH A COPY OF SUCH DEMAND TO THE ADMINISTRATIVE AGENT GIVEN IN ACCORDANCE WITH
SECTION 3.06), THE BORROWER SHALL PAY TO SUCH LENDER SUCH ADDITIONAL AMOUNTS AS
WILL COMPENSATE SUCH LENDER FOR SUCH REDUCTION.

 

3.05         Compensation for Losses.  Upon demand of any Lender (with a copy to
the Administrative Agent) from time to time, the Borrower shall promptly
compensate such Lender for and hold such Lender harmless from any loss, cost or
expense incurred by it as a result of:

 

(A)           ANY CONTINUATION, CONVERSION, PAYMENT OR PREPAYMENT OF ANY LOAN
OTHER THAN A BASE RATE LOAN ON A DAY OTHER THAN THE LAST DAY OF THE INTEREST
PERIOD FOR SUCH LOAN (WHETHER VOLUNTARY, MANDATORY, AUTOMATIC, BY REASON OF
ACCELERATION, OR OTHERWISE);

 

(B)           ANY FAILURE BY THE BORROWER (FOR A REASON OTHER THAN THE FAILURE
OF SUCH LENDER TO MAKE A LOAN) TO PREPAY, BORROW, CONTINUE OR CONVERT ANY LOAN
OTHER THAN A BASE RATE LOAN ON THE DATE OR IN THE AMOUNT NOTIFIED BY THE
BORROWER; OR

 

(C)           ANY ASSIGNMENT OF A EURODOLLAR RATE LOAN OR SCREEN RATE LOAN ON A
DAY OTHER THAN THE LAST DAY OF THE INTEREST PERIOD THEREFOR AS A RESULT OF A
REQUEST BY THE BORROWER PURSUANT TO SECTION 3.07;

 

including any loss or expense arising from the liquidation or reemployment of
funds obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained.

 

For purposes of calculating amounts payable by the Borrower to the Lenders under
this Section 3.05, each Lender shall be deemed to have funded each Eurodollar
Rate Loan or Screen Rate Loan, as applicable, made by it at the rate used in
determining the Eurodollar Rate or Screen

 

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Rate for such Loan by a matching deposit or other borrowing in the London
interbank eurodollar market or Canadian Dollar market for a comparable amount
and for a comparable period, whether or not such Eurodollar Rate Loan or Screen
Rate Loan was in fact so funded.

 

3.06         Matters Applicable to all Requests for Compensation.  (a)  A
certificate of any Agent or any Lender claiming compensation under this Article
III and setting forth the additional amount or amounts to be paid to it
hereunder shall be conclusive in the absence of manifest error.  In determining
such amount, such Agent or such Lender may use any reasonable averaging and
attribution methods.

 

(B)           WITH RESPECT TO ANY LENDER’S CLAIM FOR COMPENSATION UNDER SECTION
3.01, 3.02 OR 3.04, THE BORROWER SHALL NOT BE REQUIRED TO COMPENSATE SUCH LENDER
FOR ANY AMOUNT INCURRED MORE THAN ONE HUNDRED AND EIGHTY (180) DAYS PRIOR TO THE
DATE THAT SUCH LENDER NOTIFIES THE BORROWER OF THE EVENT THAT GIVES RISE TO SUCH
CLAIM; PROVIDED, THAT, IF THE CIRCUMSTANCE GIVING RISE TO SUCH CLAIM IS
RETROACTIVE, THEN SUCH 180-DAY PERIOD REFERRED TO ABOVE SHALL BE EXTENDED TO
INCLUDE THE PERIOD OF RETROACTIVE EFFECT THEREOF.  IF ANY LENDER REQUESTS
COMPENSATION BY THE BORROWER UNDER SECTION 3.04, THE BORROWER MAY, BY NOTICE TO
SUCH LENDER (WITH A COPY TO THE ADMINISTRATIVE AGENT), SUSPEND THE OBLIGATION OF
SUCH LENDER TO MAKE OR CONTINUE FROM ONE INTEREST PERIOD TO ANOTHER EURODOLLAR
RATE LOANS OR SCREEN RATE LOANS, OR TO CONVERT BASE RATE LOANS INTO EURODOLLAR
RATE LOANS, UNTIL THE EVENT OR CONDITION GIVING RISE TO SUCH REQUEST CEASES TO
BE IN EFFECT (IN WHICH CASE THE PROVISIONS OF SECTION 3.06(C) SHALL BE
APPLICABLE); PROVIDED, THAT SUCH SUSPENSION SHALL NOT AFFECT THE RIGHT OF SUCH
LENDER TO RECEIVE THE COMPENSATION SO REQUESTED.

 

(C)           IF THE OBLIGATION OF ANY LENDER TO MAKE OR CONTINUE FROM ONE
INTEREST PERIOD TO ANOTHER ANY EURODOLLAR RATE LOAN OR SCREEN RATE LOAN, OR TO
CONVERT BASE RATE LOANS INTO EURODOLLAR RATE LOANS SHALL BE SUSPENDED PURSUANT
TO SECTION 3.06(B) HEREOF, SUCH LENDER’S EURODOLLAR RATE LOANS SHALL BE
AUTOMATICALLY CONVERTED INTO BASE RATE LOANS ON THE LAST DAY(S) OF THE THEN
CURRENT INTEREST PERIOD(S) FOR SUCH EURODOLLAR RATE LOANS (OR, IN THE CASE OF AN
IMMEDIATE CONVERSION REQUIRED BY SECTION 3.02, ON SUCH EARLIER DATE AS REQUIRED
BY LAW) AND, UNLESS AND UNTIL SUCH LENDER GIVES NOTICE AS PROVIDED BELOW THAT
THE CIRCUMSTANCES SPECIFIED IN SECTION 3.01, 3.02, 3.03 OR 3.04 HEREOF THAT GAVE
RISE TO SUCH CONVERSION NO LONGER EXIST:

 

(I)            TO THE EXTENT THAT SUCH LENDER’S EURODOLLAR RATE LOANS HAVE BEEN
SO CONVERTED, ALL PAYMENTS AND PREPAYMENTS OF PRINCIPAL THAT WOULD OTHERWISE BE
APPLIED TO SUCH LENDER’S EURODOLLAR RATE LOANS SHALL BE APPLIED INSTEAD TO ITS
BASE RATE LOANS; AND

 

(ii)           all Loans that would otherwise be made or continued from one
Interest Period to another by such Lender as Eurodollar Rate Loans shall be made
or continued instead as Base Rate Loans, and all Base Rate Loans of such Lender
that would otherwise be converted into Eurodollar Rate Loans shall remain as
Base Rate Loans.

 

(D)           IF ANY LENDER GIVES NOTICE TO THE BORROWER (WITH A COPY TO THE
AGENT) THAT THE CIRCUMSTANCES SPECIFIED IN SECTION 3.01, 3.02, 3.03 OR 3.04
HEREOF THAT GAVE RISE TO THE CONVERSION OF SUCH LENDER’S EURODOLLAR RATE LOANS
PURSUANT TO THIS SECTION 3.06 NO LONGER EXIST (WHICH SUCH LENDER AGREES TO DO
PROMPTLY UPON SUCH CIRCUMSTANCES CEASING TO EXIST) AT A TIME WHEN EURODOLLAR
RATE LOANS MADE BY OTHER LENDERS ARE OUTSTANDING, SUCH LENDER’S BASE RATE LOANS
SHALL BE AUTOMATICALLY CONVERTED, ON THE FIRST DAY(S) OF THE NEXT SUCCEEDING
INTEREST

 

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PERIOD(S) FOR SUCH OUTSTANDING EURODOLLAR RATE LOANS, TO THE EXTENT NECESSARY SO
THAT, AFTER GIVING EFFECT THERETO, ALL LOANS HELD BY THE LENDERS HOLDING
EURODOLLAR RATE LOANS AND BY SUCH LENDER ARE HELD PRO RATA (AS TO PRINCIPAL
AMOUNTS, INTEREST RATE BASIS, AND INTEREST PERIODS) IN ACCORDANCE WITH THEIR
RESPECTIVE COMMITMENTS.

 

3.07         Replacement of Lenders under Certain Circumstances.  (a)  If at any
time (i) the Borrower becomes obligated to pay additional amounts or indemnity
payments described in Section 3.01 or 3.04 as a result of any condition
described in such Sections or any Lender ceases to make Eurodollar Rate Loans or
Screen Rate Loans as a result of any condition described in Section 3.02 or
3.03, (ii) any Lender becomes a Defaulting Lender, (iii) any Lender fails to
promptly execute and deliver the assignment documents requested pursuant to
Section 2.14(c) or (iv) any Lender becomes a “Non-Consenting Lender” (as defined
below in this Section 3.07), then the Borrower may, on ten (10) Business Days’
prior written notice to the Administrative Agent and such Lender, either
(A) replace such Lender by causing such Lender to (and such Lender shall be
obligated to) assign pursuant to Section 10.07(b) (with the assignment fee to be
paid by the Borrower in such instance) all of its rights and obligations under
this Agreement to one or more Eligible Assignees; provided, that neither the
Administrative Agent nor any Lender shall have any obligation to the Borrower to
find a replacement Lender or other such Person or (B) terminate the Commitment
of such Lender and repay all obligations of the Borrower owing to such Lender
relating to the Loans and participations held by such Lender as of such
termination date.

 

(B)           ANY LENDER BEING REPLACED PURSUANT TO SECTION 3.07(A) ABOVE SHALL
(I) EXECUTE AND DELIVER AN ASSIGNMENT AND ASSUMPTION WITH RESPECT TO SUCH
LENDER’S COMMITMENT AND OUTSTANDING LOANS AND PARTICIPATIONS IN L/C OBLIGATIONS
AND SWING LINE LOANS, AND (II) DELIVER ANY NOTES EVIDENCING SUCH LOANS TO THE
BORROWER OR ADMINISTRATIVE AGENT.  PURSUANT TO SUCH ASSIGNMENT AND ASSUMPTION,
(I) THE ASSIGNEE LENDER SHALL ACQUIRE ALL OR A PORTION, AS THE CASE MAY BE, OF
THE ASSIGNING LENDER’S COMMITMENT AND OUTSTANDING LOANS AND PARTICIPATIONS IN
L/C OBLIGATIONS AND SWING LINE LOANS, (II) ALL OBLIGATIONS OF THE BORROWER OWING
TO THE ASSIGNING LENDER RELATING TO THE LOANS AND PARTICIPATIONS SO ASSIGNED
SHALL BE PAID IN FULL BY THE ASSIGNEE LENDER TO SUCH ASSIGNING LENDER
CONCURRENTLY WITH SUCH ASSIGNMENT AND ASSUMPTION AND (III) UPON SUCH PAYMENT
AND, IF SO REQUESTED BY THE ASSIGNEE LENDER, DELIVERY TO THE ASSIGNEE LENDER OF
THE APPROPRIATE NOTE OR NOTES EXECUTED BY THE BORROWER, THE ASSIGNEE LENDER
SHALL BECOME A LENDER HEREUNDER AND THE ASSIGNING LENDER SHALL CEASE TO
CONSTITUTE A LENDER HEREUNDER WITH RESPECT TO SUCH ASSIGNED LOANS, COMMITMENTS
AND PARTICIPATIONS, EXCEPT WITH RESPECT TO INDEMNIFICATION PROVISIONS UNDER THIS
AGREEMENT, WHICH SHALL SURVIVE AS TO SUCH ASSIGNING LENDER.

 

(C)           NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED ABOVE, (I) THE
LENDER THAT ACTS AS THE L/C ISSUER MAY NOT BE REPLACED HEREUNDER AT ANY TIME
THAT IT HAS ANY LETTER OF CREDIT OUTSTANDING HEREUNDER UNLESS ARRANGEMENTS
SATISFACTORY TO SUCH L/C ISSUER (INCLUDING THE FURNISHING OF A BACK-UP STANDBY
LETTER OF CREDIT IN FORM AND SUBSTANCE, AND ISSUED BY AN ISSUER REASONABLY
SATISFACTORY TO SUCH L/C ISSUER OR THE DEPOSITING OF CASH COLLATERAL INTO A CASH
COLLATERAL ACCOUNT IN AMOUNTS AND PURSUANT TO ARRANGEMENTS REASONABLY
SATISFACTORY TO SUCH L/C ISSUER) HAVE BEEN MADE WITH RESPECT TO SUCH OUTSTANDING
LETTER OF CREDIT AND (II) THE LENDER THAT ACTS AS THE ADMINISTRATIVE AGENT MAY
NOT BE REPLACED HEREUNDER EXCEPT IN ACCORDANCE WITH THE TERMS OF SECTION 9.09.

 

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(D)           IN THE EVENT THAT (I) THE BORROWER OR THE ADMINISTRATIVE AGENT HAS
REQUESTED THE LENDERS TO CONSENT TO A DEPARTURE OR WAIVER OF ANY PROVISIONS OF
THE LOAN DOCUMENTS OR TO AGREE TO ANY AMENDMENT THERETO, (II) THE CONSENT,
WAIVER OR AMENDMENT IN QUESTION REQUIRES THE AGREEMENT OF ALL AFFECTED LENDERS
IN ACCORDANCE WITH THE TERMS OF SECTION 10.01 OR ALL THE LENDERS WITH RESPECT TO
A CERTAIN CLASS OF THE LOANS AND (III) THE REQUIRED LENDERS HAVE AGREED TO SUCH
CONSENT, WAIVER OR AMENDMENT, THEN ANY LENDER WHO DOES NOT AGREE TO SUCH
CONSENT, WAIVER OR AMENDMENT SHALL BE DEEMED A “NON-CONSENTING LENDER.”

 

3.08         SURVIVAL.  ALL OF THE BORROWER’S OBLIGATIONS UNDER THIS ARTICLE III
SHALL SURVIVE THE TERMINATION DATE.

 

ARTICLE IV
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

4.01         Conditions of Initial Credit Extension.  The obligation of each
Lender to make its initial Credit Extension hereunder is subject to satisfaction
or waiver of the following conditions precedent:

 

(A)           THE ADMINISTRATIVE AGENT’S RECEIPT OF THE FOLLOWING, EACH OF WHICH
SHALL BE ORIGINALS OR FACSIMILES (FOLLOWED PROMPTLY BY ORIGINALS) UNLESS
OTHERWISE SPECIFIED, EACH PROPERLY EXECUTED BY A RESPONSIBLE OFFICER OF THE
SIGNING LOAN PARTY, EACH DATED THE CLOSING DATE (OR, IN THE CASE OF CERTIFICATES
OF GOVERNMENTAL OFFICIALS, A RECENT DATE BEFORE THE CLOSING DATE) AND EACH IN
FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE ADMINISTRATIVE AGENT AND EACH
OF THE LENDERS:

 

(I)            EXECUTED COUNTERPARTS OF THIS AGREEMENT AND THE GUARANTY,
SUFFICIENT IN NUMBER FOR DISTRIBUTION TO EACH AGENT, EACH LENDER AND THE
BORROWER;

 

(II)           A NOTE EXECUTED BY THE BORROWER IN FAVOR OF EACH LENDER
REQUESTING A NOTE;

 

(III)          A SECURITY AGREEMENT, IN SUBSTANTIALLY THE FORM OF EXHIBIT G
HERETO (TOGETHER WITH EACH OTHER SECURITY AGREEMENT AND SECURITY AGREEMENT
SUPPLEMENT DELIVERED PURSUANT TO SECTION 6.11 AND 6.15, IN EACH CASE AS AMENDED,
THE “SECURITY AGREEMENT”), DULY EXECUTED BY EACH LOAN PARTY, TOGETHER WITH:

 

(A)          certificates (if any) representing the Pledged Interests referred
to therein accompanied by undated stock powers executed in blank and instruments
evidencing the Pledged Debt indorsed in blank,

 

(B)           copies of proper financing statements, duly prepared for filing
under the Uniform Commercial Code in all jurisdictions that the Administrative
Agent may deem reasonably necessary or desirable in order to perfect and protect
the first priority liens and security interests created under the Security
Agreement, covering the Collateral described in the Security Agreement, and

 

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(C)           evidence that all other actions, recordings and filings of or with
respect to the Security Agreement that the Administrative Agent may deem
reasonably necessary or desirable in order to perfect and protect the Liens
created thereby;

 

(IV)          A MORTGAGE, IN SUBSTANTIALLY THE FORM OF EXHIBIT H HERETO (WITH
SUCH CHANGES AS MAY BE REASONABLY SATISFACTORY TO THE ADMINISTRATIVE AGENT AND
ITS COUNSEL TO ACCOUNT FOR LOCAL LAW MATTERS) AND COVERING THE BORROWER’S
ORRVILLE, OHIO FERTILIZER PLANT (TOGETHER WITH EACH OTHER MORTGAGE DELIVERED
PURSUANT TO SECTION 6.11, IN EACH CASE AS AMENDED, THE “MORTGAGES”), DULY
EXECUTED BY THE APPROPRIATE LOAN PARTY, TOGETHER WITH:

 

(A)          evidence that a counterpart of the Mortgage has been duly executed,
acknowledged and delivered and is in form suitable for filing or recording in
the applicable Ohio jurisdiction and that all applicable filing and recording
taxes and fees have been paid, and

 

(B)           evidence that all other action that the Administrative Agent may
reasonably deem necessary or desirable in order to create a valid first and
subsisting Lien on the Orrville, Ohio property, subject to Liens permitted by
Section 7.01, has been taken;

 

(V)           AN INTELLECTUAL PROPERTY SECURITY AGREEMENT, IN SUBSTANTIALLY THE
FORM OF EXHIBIT I HERETO (TOGETHER WITH EACH OTHER INTELLECTUAL PROPERTY
SECURITY AGREEMENT AND INTELLECTUAL PROPERTY SECURITY AGREEMENT SUPPLEMENT
DELIVERED PURSUANT TO SECTION 6.11 AND 6.15, IN EACH CASE AS AMENDED, THE
“INTELLECTUAL PROPERTY SECURITY AGREEMENT”), DULY EXECUTED BY EACH LOAN PARTY,
TOGETHER WITH EVIDENCE THAT ALL ACTION THAT THE ADMINISTRATIVE AGENT MAY
REASONABLY DEEM NECESSARY OR DESIRABLE IN ORDER TO PERFECT AND PROTECT THE FIRST
PRIORITY LIENS AND SECURITY INTERESTS CREATED UNDER THE INTELLECTUAL PROPERTY
SECURITY AGREEMENT HAS BEEN TAKEN;

 

(VI)          SUCH CERTIFICATES OF RESOLUTIONS OR OTHER ACTION, INCUMBENCY
CERTIFICATES AND/OR OTHER CERTIFICATES OF RESPONSIBLE OFFICERS OF EACH LOAN
PARTY AS THE ADMINISTRATIVE AGENT MAY REASONABLY REQUIRE EVIDENCING THE
IDENTITY, AUTHORITY AND CAPACITY OF EACH RESPONSIBLE OFFICER THEREOF AUTHORIZED
TO ACT AS A RESPONSIBLE OFFICER IN CONNECTION WITH THIS AGREEMENT AND THE OTHER
LOAN DOCUMENTS TO WHICH SUCH LOAN PARTY IS A PARTY OR IS TO BE A PARTY;

 

(VII)         SUCH DOCUMENTS AND CERTIFICATIONS AS THE ADMINISTRATIVE AGENT MAY
REASONABLY REQUIRE TO EVIDENCE THAT EACH LOAN PARTY IS DULY ORGANIZED OR FORMED,
AND THAT EACH LOAN PARTY IS VALIDLY EXISTING AND IN GOOD STANDING UNDER ITS
JURISDICTION OF INCORPORATION;

 

(VIII)        A REASONABLY SATISFACTORY OPINION OF WEIL, GOTSHAL AND MANGES LLP,
SPECIAL COUNSEL TO THE LOAN PARTIES, ADDRESSED TO EACH AGENT AND EACH LENDER, AS
TO THE MATTERS SET FORTH IN EXHIBIT J-1 AND SUCH OTHER MATTERS

 

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CONCERNING THE LOAN PARTIES AND THE LOAN DOCUMENTS AS THE REQUIRED LENDERS MAY
REASONABLY REQUEST;

 

(IX)           A REASONABLY SATISFACTORY OPINION OF BENESCH, FRIEDLANDER, COPLAN
& ARONOFF LLP, LOCAL COUNSEL TO THE BORROWER IN OHIO, AS TO THE MATTERS SET
FORTH IN EXHIBIT J-2 AND SUCH OTHER MATTERS CONCERNING THE LOAN PARTIES AND THE
LOAN DOCUMENTS AS THE REQUIRED LENDERS MAY REASONABLY REQUEST;

 

(X)            A CERTIFICATE OF A RESPONSIBLE OFFICER OF THE BORROWER EITHER (A)
ATTACHING COPIES OF ALL CONSENTS, LICENSES AND APPROVALS REQUIRED IN CONNECTION
WITH THE EXECUTION, DELIVERY AND PERFORMANCE BY THE BORROWER OR ANY OTHER LOAN
PARTY AND THE VALIDITY AGAINST THE BORROWER OR SUCH LOAN PARTY OF THE LOAN
DOCUMENTS TO WHICH IT IS A PARTY, AND SUCH CONSENTS, LICENSES AND APPROVALS
SHALL BE IN FULL FORCE AND EFFECT, OR (B) STATING THAT NO SUCH CONSENTS,
LICENSES OR APPROVALS ARE SO REQUIRED;

 

(XI)           A CERTIFICATE SIGNED BY A RESPONSIBLE OFFICER OF THE BORROWER
CERTIFYING (A) THAT THE CONDITIONS SPECIFIED IN SECTIONS 4.02(A) AND (B) HAVE
BEEN SATISFIED, AND (B) THAT THERE HAS BEEN NO EVENT OR CIRCUMSTANCE SINCE
FEBRUARY 29, 2004 THAT HAS HAD OR COULD BE REASONABLY EXPECTED TO HAVE, EITHER
INDIVIDUALLY OR IN THE AGGREGATE, A NU-GRO MATERIAL ADVERSE EFFECT;

 

(XII)          CERTIFICATES ATTESTING TO THE SOLVENCY OF THE BORROWER AND ITS
SUBSIDIARIES TAKEN AS A WHOLE, BEFORE AND AFTER GIVING EFFECT TO THE NU-GRO
TRANSACTION, FROM ITS CHIEF FINANCIAL OFFICER;

 

(XIII)         REASONABLY SATISFACTORY EVIDENCE THAT ALL INSURANCE REQUIRED TO
BE MAINTAINED PURSUANT TO THE LOAN DOCUMENTS HAS BEEN OBTAINED AND IS IN EFFECT,
TOGETHER WITH THE ENDORSEMENTS OF INSURANCE REQUIRED BY THE TERMS OF THE
SECURITY AGREEMENT;

 

(XIV)        A NOTICE OF BORROWING OR NOTICE OF LETTER OF CREDIT ISSUANCE, AS
APPLICABLE, RELATING TO THE INITIAL CREDIT EXTENSION;

 

(XV)         REASONABLY SATISFACTORY EVIDENCE THAT THE EXISTING CREDIT AGREEMENT
HAS BEEN OR CONCURRENTLY WITH THE CLOSING DATE IS BEING TERMINATED AND ALL LIENS
SECURING OBLIGATIONS UNDER THE EXISTING CREDIT AGREEMENT HAVE BEEN OR
CONCURRENTLY WITH THE CLOSING DATE ARE BEING RELEASED; AND

 

(XVI)        (A) UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS OF NU-GRO AND ITS
SUBSIDIARIES FOR ANY QUARTERLY PERIODS ENDED SINCE DECEMBER 31, 2003 FOR WHICH
SUCH STATEMENTS ARE AVAILABLE, AND A PRO FORMA BALANCE SHEET, INCOME STATEMENT
AND STATEMENT OF CASH FLOWS AS TO THE COMPANY AND ITS SUBSIDIARIES AS OF THE END
OF AND FOR THE MOST RECENT FOUR FISCAL QUARTER PERIOD ENDED AT LEAST 45 DAYS
PRIOR TO THE CLOSING DATE, IN EACH CASE ADJUSTED TO GIVE EFFECT TO THE
CONSUMMATION OF THE NU-GRO ACQUISITION AS IF THE NU-GRO ACQUISITION, (X) WITH
RESPECT TO THE PRO FORMA BALANCE SHEET, HAD OCCURRED ON SUCH DATE, AND (Y) WITH
RESPECT TO THE PRO FORMA INCOME STATEMENT AND PRO FORMA STATEMENT OF CASH FLOWS,
HAD OCCURRED

 

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ON THE FIRST DAY OF SUCH FOUR FISCAL QUARTER PERIOD AND (B) THE FORECASTS DATED
FEBRUARY 26, 2004 PREPARED BY MANAGEMENT OF THE BORROWER OF BALANCE SHEETS,
INCOME STATEMENTS AND CASH FLOW STATEMENTS FOR EACH MONTH FOR THE FIRST TWELVE
MONTHS FOLLOWING THE CLOSING DATE AND FOR EACH YEAR COMMENCING WITH THE FIRST
FISCAL YEAR FOLLOWING THE CLOSING DATE FOR THE TERM OF THE FACILITIES.

 

(XVII)       CERTIFIED COPIES OF THE NU-GRO ACQUISITION DOCUMENTS DULY EXECUTED
BY THE PARTIES THERETO, WHICH SHALL BE IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY TO THE ADMINISTRATIVE AGENT.

 

(B)           (I) THE ACQUISITION SHALL BE CONSUMMATED SIMULTANEOUSLY WITH THE
INITIAL CREDIT EXTENSION IN ACCORDANCE WITH APPLICABLE LAW (INCLUDING THE
REQUISITE APPROVAL BY 662/3% OF NU-GRO’S SHAREHOLDERS ATTENDING NU-GRO’S
SHAREHOLDERS’ MEETING HELD FOR SUCH PURPOSE AND THE REQUISITE COURT APPROVAL)
AND IN ACCORDANCE WITH THE TERMS OF THE ARRANGEMENT AGREEMENT AND (II) THE U.S.
REORGANIZATION SHALL HAVE BEEN CONSUMMATED SIMULTANEOUSLY WITH THE INITIAL
CREDIT EXTENSION.

 

(C)           THE ADMINISTRATIVE AGENT SHALL BE REASONABLY SATISFIED THAT THERE
HAS BEEN NO MATERIAL ADVERSE CHANGE (FROM THE STANDPOINT OF THE LENDERS) IN THE
PRO FORMA CAPITAL AND OWNERSHIP STRUCTURE AND THE SHAREHOLDER ARRANGEMENTS OF
THE BORROWER AND EACH OF THE GUARANTORS SINCE FEBRUARY 29, 2004 (OTHER THAN AS
TO BE EFFECTED PURSUANT TO THE NU-GRO TRANSACTION).

 

(D)           THERE SHALL NOT HAVE OCCURRED AN ADVERSE CHANGE OF $1,000,000 OR
MORE IN THE BUSINESS, OPERATIONS (INCLUDING RESULTS OF OPERATIONS), ASSETS,
PROPERTIES, CAPITAL OR CONDITION (FINANCIAL OR OTHERWISE) OF NU-GRO AND ITS
SUBSIDIARIES, TAKEN AS A WHOLE, SINCE SEPTEMBER 30, 2003.

 

(E)           ALL GOVERNMENTAL, SHAREHOLDER AND MATERIAL THIRD PARTY CONSENTS
AND APPROVALS (INCLUDING, WITHOUT LIMITATION, HART-SCOTT-RODINO CLEARANCE AND
COMPETITION ACT (CANADA) AND INVESTMENT CANADA ACT APPROVALS, IF APPLICABLE)
NECESSARY IN CONNECTION WITH THE NU-GRO TRANSACTION SHALL HAVE BEEN OBTAINED AND
SHALL REMAIN IN EFFECT; ALL APPLICABLE WAITING PERIODS IN CONNECTION WITH THE
NU-GRO TRANSACTION SHALL HAVE EXPIRED WITHOUT ANY ACTION BEING TAKEN BY ANY
GOVERNMENTAL AUTHORITY, THAT COULD RESTRAIN, PREVENT OR IMPOSE MATERIALLY
ADVERSE CONDITIONS UPON THE BORROWER AND ITS SUBSIDIARIES OR THAT COULD SEEK OR
THREATEN ANY OF THE FOREGOING IN ANY MATERIAL RESPECT, AND NO LAW SHALL BE
APPLICABLE WHICH IN THE REASONABLE JUDGMENT OF THE ADMINISTRATIVE AGENT COULD
REASONABLY BE EXPECTED TO HAVE SUCH EFFECT.

 

(F)            THERE SHALL EXIST NO ACTION, SUIT, INVESTIGATION OR PROCEEDING
AFFECTING ANY LOAN PARTY OR ANY OF ITS SUBSIDIARIES PENDING OR, TO THE KNOWLEDGE
OF THE BORROWER, THREATENED BEFORE ANY GOVERNMENTAL AUTHORITY OR ARBITRATOR THAT
COULD BE REASONABLY BE EXPECTED TO HAVE A NU-GRO MATERIAL ADVERSE EFFECT.

 

(G)           ALL LOANS MADE BY THE LENDERS TO THE BORROWER SHALL BE IN FULL
COMPLIANCE WITH THE FEDERAL RESERVE’S MARGIN REGULATIONS.

 

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(H)           THE LENDERS SHALL BE SATISFIED THAT THE AMOUNT, TERMS, CONDITIONS
AND HOLDERS OF ALL INTERCOMPANY INDEBTEDNESS (IT BEING UNDERSTOOD THAT
INTERCOMPANY INDEBTEDNESS CONTEMPLATED BY THE NU-GRO TRANSACTION AND DESCRIBED
TO THE LEAD ARRANGERS PRIOR TO FEBRUARY 29, 2004 IS ACCEPTABLE) AND ALL
INDEBTEDNESS AND OTHER MATERIAL LIABILITIES OWING TO THIRD PARTIES TO BE
OUTSTANDING ON AND AFTER THE CLOSING DATE (INCLUDING, FOR THE AVOIDANCE OF
DOUBT, THOSE OF NU-GRO AND ITS SUBSIDIARIES) ARE NOT MATERIALLY AND ADVERSELY
DIFFERENT FROM THOSE IN EFFECT ON FEBRUARY 29, 2004, EXCEPT FOR THOSE CHANGES
THAT RELATE TO THE NU-GRO TRANSACTION.

 

(I)            ALL FEES REQUIRED TO BE PAID ON OR BEFORE THE CLOSING DATE
(INCLUDING THE FEES AND EXPENSES OF COUNSEL TO THE ADMINISTRATIVE AGENT) SHALL
HAVE BEEN PAID.

 

4.02         Conditions to all Credit Extensions.  The obligation of each Lender
to honor any Request for Credit Extension (other than a Committed Loan Notice
requesting only a conversion of Loans to the other Type, or a continuation of
Eurodollar Rate Loans) is subject to the following conditions precedent:

 

(A)           THE REPRESENTATIONS AND WARRANTIES OF THE BORROWER AND EACH OTHER
LOAN PARTY CONTAINED IN ARTICLE V OR ANY OTHER LOAN DOCUMENT, SHALL BE TRUE AND
CORRECT IN ALL MATERIAL RESPECTS ON AND AS OF THE DATE OF SUCH CREDIT EXTENSION,
EXCEPT TO THE EXTENT THAT SUCH REPRESENTATIONS AND WARRANTIES SPECIFICALLY REFER
TO AN EARLIER DATE, IN WHICH CASE THEY SHALL BE TRUE AND CORRECT IN ALL MATERIAL
RESPECTS AS OF SUCH EARLIER DATE, AND EXCEPT THAT FOR PURPOSES OF THIS SECTION
4.02, THE REPRESENTATIONS AND WARRANTIES CONTAINED IN SECTION 5.06 SHALL BE
DEEMED TO REFER TO THE MOST RECENT STATEMENTS FURNISHED PURSUANT TO SECTIONS
6.13(B) AND (C).

 

(B)           NO DEFAULT SHALL EXIST, OR WOULD RESULT FROM SUCH PROPOSED CREDIT
EXTENSION OR FROM THE APPLICATION OF THE PROCEEDS THEREFROM.

 

(C)           THE ADMINISTRATIVE AGENT AND, IF APPLICABLE, THE L/C ISSUER OR THE
SWING LINE LENDER SHALL HAVE RECEIVED A REQUEST FOR CREDIT EXTENSION IN
ACCORDANCE WITH THE REQUIREMENTS HEREOF.

 

Each Request for Credit Extension (other than a Committed Loan Notice requesting
only a conversion of Loans to the other Type or a continuation of Eurodollar
Rate Loans) submitted by the Borrower shall be deemed to be a representation and
warranty that the conditions specified in Sections 4.02(a) and (b) have been
satisfied on and as of the date of the applicable Credit Extension.

 

ARTICLE V
REPRESENTATIONS AND WARRANTIES

 

Representations and Warranties.  Each of Holdings and the Borrower hereby
represents and warrants as follows:

 

5.01         Existence, Qualification and Power.  Each of the Loan Parties and
each of their Subsidiaries (a) are corporations, limited partnerships or limited
liability companies duly organized and validly existing under the laws of the
jurisdictions of their respective organization

 

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and are in good standing under the laws of such jurisdiction and (b) are duly
qualified as foreign corporations, limited partnerships or limited liability
companies and are in good standing in each other jurisdiction in which the
ownership, lease or operation of their respective property and assets or the
conduct of their respective businesses require them to so qualify or be
licensed, except, solely in the case of this clause (b), where the failure to so
qualify or be licensed or to be in good standing, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect. 
Each of the Loan Parties and each of their Subsidiaries have all of the
requisite power and authority, and the legal right, to own or lease and to
operate all of the property and assets they purport to own, lease or operate and
to conduct all of their respective businesses as now conducted.  Each of the
Loan Parties has all of the requisite power and authority, and the legal right,
to execute and deliver each of the Loan Documents to which it is a party, to
perform all of its obligations hereunder and thereunder and to consummate the
Nu-Gro Transaction, the Holding Company Event (if and when consummated) and all
of the other transactions contemplated hereby and thereby.

 

5.02         Capitalization.  Set forth on Schedule 5.02 hereto is a complete
and accurate list of all of the Subsidiaries of the Borrower as of the date of
this Agreement showing, as to each such Subsidiary, the correct legal name
thereof, the type of entity, the jurisdiction of its organization, the number
and type of each class of its Equity Interests authorized and the number
outstanding, and the percentage of each such class of its Equity Interests
outstanding on such date that are owned by any of the Loan Parties.  As of the
date of this Agreement, all of the outstanding Equity Interests in each of the
Subsidiaries of the Borrower are owned directly or indirectly by one or more of
the Loan Parties, free and clear of all Liens, except those created under the
Collateral Documents.  All of the outstanding Equity Interests in the Borrower
and each of its Subsidiaries have been validly issued and are fully paid and
nonassessable.

 

5.03         Authorization; No Contravention.  The execution, delivery and
performance by each of the Loan Parties of each of the Loan Documents and the
Nu-Gro Acquisition Documents to which it is a party, and the consummation of the
Nu-Gro Transaction, the Holding Company Event (if and when consummated) and the
other transactions contemplated hereby and thereby, have been duly authorized by
all necessary action (including, without limitation, all necessary shareholder,
partner, member or other similar action) and do not:

 

(A)           CONTRAVENE THE CONSTITUTIVE DOCUMENTS OF SUCH LOAN PARTY;

 

(B)           VIOLATE ANY REQUIREMENT OF LAW;

 

(C)           CONFLICT WITH OR RESULT IN THE BREACH OF, OR CONSTITUTE A DEFAULT
UNDER, ANY LOAN AGREEMENT, INDENTURE, MORTGAGE, DEED OF TRUST, LEASE,
INSTRUMENT, CONTRACT OR OTHER AGREEMENT BINDING ON OR AFFECTING SUCH LOAN PARTY
OR ANY OF ITS SUBSIDIARIES OR ANY OF THEIR RESPECTIVE PROPERTY OR ASSETS IN A
MANNER WHICH COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT; OR

 

(D)           EXCEPT FOR THE LIENS CREATED UNDER THE COLLATERAL DOCUMENTS,
RESULT IN OR REQUIRE THE CREATION OR IMPOSITION OF ANY LIEN UPON OR WITH RESPECT
TO ANY OF THE PROPERTY OR ASSETS OF SUCH LOAN PARTY OR ANY OF ITS SUBSIDIARIES.

 

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Neither any of the Loan Parties nor any of their respective Subsidiaries is in
violation of any Requirement of Law or in breach of any loan agreement,
indenture, mortgage, deed of trust, lease, instrument, contract or other
agreement referred to in the immediately preceding sentence, the violation or
breach of which, either individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.

 

5.04         Governmental Authorization; Other Consents.  Each of the Loan
Parties and each of their Subsidiaries own or possess all of the Governmental
Authorizations that are necessary to own or lease and operate their respective
property and assets and to conduct their respective businesses as now conducted,
except where and to the extent that the failure to obtain or maintain in effect
any such Governmental Authorization, either individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.  Neither any
of the Loan Parties nor any of their Subsidiaries has received any notice
relating to or threatening the revocation, termination, cancellation, denial,
impairment or modification of any such Governmental Authorization, or is in
violation or contravention of, or in default under, any such Governmental
Authorization that in any case could reasonably be expected to have a Material
Adverse Effect.  No Governmental Authorization and no consent, approval or
authorization of, or notice to or filing with, or other action by, any other
Person is required for:

 

(A)           THE DUE EXECUTION, DELIVERY OR PERFORMANCE BY ANY OF THE LOAN
PARTIES OF ANY OF THE LOAN DOCUMENTS OR THE NU-GRO ACQUISITION DOCUMENTS TO
WHICH IT IS A PARTY, OR FOR THE CONSUMMATION OF ANY ASPECT OF THE NU-GRO
TRANSACTION;

 

(B)           THE GRANT BY ANY OF THE LOAN PARTIES OF THE LIENS GRANTED BY IT
PURSUANT TO THE COLLATERAL DOCUMENTS;

 

(C)           THE PERFECTION OR MAINTENANCE OF THE LIENS CREATED UNDER THE
COLLATERAL DOCUMENTS (INCLUDING THE PRIORITY THEREOF);

 

(D)           THE EXERCISE BY ANY OF THE AGENTS OR ANY OF THE LENDERS OF ITS
RIGHTS UNDER THE LOAN DOCUMENTS OR THE REMEDIES IN RESPECT OF THE COLLATERAL
PURSUANT TO THE COLLATERAL DOCUMENTS; OR

 

(E)           THE CONSUMMATION OF THE HOLDING COMPANY EVENT (IF AND WHEN
CONSUMMATED),

 

except for the approvals, consents, exemptions, authorizations, actions, notices
and filings that have been duly obtained, taken, given or made and are in full
force and effect and, in the case of the Nu-Gro Transaction and the Holding
Company Event (if and when consummated), those approvals, consents, exemptions,
authorizations or other actions, notices or filings, the failure of which to
obtain or make could not reasonably be expected to have a Material Adverse
Effect.  All applicable waiting periods in connection with each aspect of the
Nu-Gro Transaction have expired without any action having been taken by any
competent Governmental Authority restraining, preventing or imposing materially
adverse conditions upon the Loan Parties and their Subsidiaries or that could
seek or threaten any of the foregoing in any material respect.

 

5.05         Enforceability.  This Agreement has been, and each of the Notes and
each of the other Loan Documents when delivered hereunder will have been, duly
executed and

 

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delivered by each of the Loan Parties party thereto.  This Agreement is, and
each of the Notes and each of the other Loan Documents when delivered hereunder
will be, the legal, valid and binding obligations of each of the Loan Parties
party thereto, enforceable against such Loan Party in accordance with their
respective terms, except to the extent such enforceability may be limited by the
effect of applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors’ rights generally or by
general principles of equity.

 

5.06         Financial Statements; No Material Adverse Effect.  (a)  The balance
sheets of the Borrower as of December 31, 2001, December 31, 2002 and
December 31, 2003, and the related statements of income, stockholders’ equity
and cash flow of the Borrower for the Fiscal Years then ended, in each case
including the schedules and notes thereto and accompanied by an opinion of
PricewaterhouseCoopers LLP, the independent auditors of the Borrower, copies of
all of which have been furnished to the Lenders, fairly present in all material
respects the financial condition of the Borrower as at such dates and the
results of operations and cash flow of the Borrower for the respective periods
ended on such dates.

 

(B)           THE BALANCE SHEETS OF NU-GRO AS OF SEPTEMBER 30, 2001, SEPTEMBER
30, 2002 AND SEPTEMBER 30, 2003, AND THE RELATED STATEMENTS OF INCOME,
STOCKHOLDERS’ EQUITY AND CASH FLOW OF NU-GRO FOR THE FISCAL YEARS THEN ENDED,
AND THE BALANCE SHEET OF NU-GRO AS OF DECEMBER 31, 2003, AND THE RELATED
STATEMENTS OF INCOME, STOCKHOLDERS’ EQUITY AND CASH FLOW OF NU-GRO FOR THE
THREE-MONTH PERIOD THEN ENDED, IN EACH CASE INCLUDING THE SCHEDULES AND NOTES
THERETO (IF ANY) AND ACCOMPANIED BY AN OPINION OF ERNST & YOUNG LLP, THE
INDEPENDENT AUDITORS OF NU-GRO, COPIES OF ALL OF WHICH HAVE BEEN FURNISHED TO
THE LENDERS, FAIRLY PRESENT IN ALL MATERIAL RESPECTS (SUBJECT, SOLELY IN THE
CASE OF SUCH FINANCIAL STATEMENTS OF NU-GRO AS OF AND FOR THE THREE-MONTH PERIOD
ENDED DECEMBER 31, 2003, TO NORMAL YEAR-END AUDIT ADJUSTMENTS AND THE ABSENCE OF
FOOTNOTES) THE FINANCIAL CONDITION OF NU-GRO AS AT SUCH DATES AND THE RESULTS OF
OPERATIONS AND CASH FLOW OF NU-GRO FOR THE RESPECTIVE PERIODS ENDED ON SUCH
DATES.

 

(C)           ALL OF THE FINANCIAL STATEMENTS REFERRED TO (I) IN CLAUSE (A)
ABOVE, INCLUDING THE SCHEDULES AND NOTES THERETO, HAVE BEEN PREPARED IN
ACCORDANCE WITH GAAP APPLIED CONSISTENTLY THROUGHOUT THE RESPECTIVE PERIODS
COVERED THEREBY, EXCEPT AS NOTED THEREIN AND (II) IN CLAUSE (B) ABOVE, INCLUDING
THE SCHEDULES AND NOTES THERETO, HAVE BEEN PREPARED IN ACCORDANCE WITH CANADIAN
GAAP APPLIED CONSISTENTLY THROUGHOUT THE RESPECTIVE PERIODS COVERED THEREBY,
EXCEPT AS NOTED THEREIN.  AS OF THE CLOSING DATE, NEITHER THE BORROWER NOR
NU-GRO HAS ANY MATERIAL INDEBTEDNESS OR OTHER MATERIAL FIXED OR CONTINGENT
LIABILITIES, MATERIAL LIABILITIES FOR TAXES, UNUSUAL FORWARD OR LONG-TERM
MATERIAL COMMITMENTS OR ANTICIPATED MATERIAL LOSSES FROM ANY UNFAVORABLE
COMMITMENTS, IN EACH CASE THAT ARE REQUIRED BY GAAP TO BE DISCLOSED, EXCEPT AS
OTHERWISE PERMITTED HEREUNDER.

 

(D)           SINCE FEBRUARY 29, 2004, THERE HAS BEEN NO EVENT OR CIRCUMSTANCE,
EITHER INDIVIDUALLY OR IN THE AGGREGATE, THAT HAS HAD OR COULD REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

5.07         Projections.  The forecasted Consolidated balance sheets and
statements of income or operations, stockholders’ equity and cash flow of the
Borrower and its Subsidiaries delivered to the Lenders pursuant to Section
4.01(a)(xvi) or 6.13(e) were prepared in good faith

 

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on the basis of the assumptions stated therein, which assumptions were fair in
the light of conditions existing at the time made, and represented, at the time
of delivery thereof to the Lenders, the Borrower’s reasonable estimate of its
future financial performance (although the actual results during the periods
covered by such forecasts may differ from the forecasted results).

 

5.08         Accuracy of Information.  All of the written information (other
than financial projections and pro forma information) furnished by or on behalf
of any of the Loan Parties or any of their Subsidiaries to any of the Agents or
any of the Lenders or any of their representatives or advisors in connection
with the Loan Documents or the Nu-Gro Acquisition Documents or any aspect of the
Nu-Gro Transaction or any of the other transactions contemplated hereby or
thereby, considered as a whole, does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made therein, in light of the circumstances in which any such statements were
made, not materially misleading.

 

5.09         Litigation.  There is no action, suit, litigation, arbitration or
proceeding pending or, to the knowledge of the Borrower, threatened (and, to the
knowledge of the Borrower, there is no investigation pending or threatened)
against or affecting any of the Loan Parties or any of their Subsidiaries or any
of the property or assets thereof in any court or before any arbitrator or by or
before any Governmental Authority of any kind that either individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

 

5.10         Collateral; Liens.  Each of the Loan Parties is the legal and
beneficial owner of the Collateral purported to be owned thereby under the
Collateral Documents, free and clear of all Liens, except for the liens and
security interests created or permitted under the Loan Documents.  The
Collateral Documents, together with the filing of appropriate Uniform Commercial
Code financing statements in favor of the Administrative Agent, on behalf of the
Secured Parties, the possession of the certificates evidencing the Equity
Interests in the Subsidiaries of the Borrower (or upon consummation of the
Holding Company Event, the Subsidiaries of Holdings) comprising part of the
Collateral and the taking of any other actions described in the Collateral
Documents, create valid and perfected first priority liens on and security
interests in the Collateral (subject to the liens and security interests
permitted under Section 7.01) in favor of the Administrative Agent, for the
benefit of the Secured Parties, securing the payment of the Secured
Obligations.  Certificates (if applicable as to any Subsidiary) representing all
of the Equity Interests in the Subsidiaries of the Loan Parties that are
purported to comprise part of the Collateral have been delivered to the
Administrative Agent as required under the terms of the Collateral Documents,
together with undated stock powers or other appropriate powers duly executed in
blank; all filings and other actions necessary to perfect and protect the liens
and security interests of the Administrative Agent in the Collateral have been
duly made or taken and are in full force and effect or will be duly made or
taken in accordance with the terms of the Loan Documents; and all filing fees
and recording taxes have been paid in full.

 

5.11         Intellectual Property.  Each of the Loan Parties and each of their
Subsidiaries own or have the legal right to use all of the patents, licenses,
franchises, copyrights, service marks, trademarks, trade secrets and trade names
(collectively, “IP Rights”) that are necessary to own or lease and operate their
respective property and assets and to conduct their

 

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respective businesses as now conducted, without known conflict with the rights
of any other Person except to the extent the failure to so own or possess any
such IP Right (or such conflict pertaining thereto) could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.  No
action, suit, litigation, arbitration or proceeding is pending or, to the
knowledge of the Borrower, threatened (and, to the knowledge of the Borrower, no
investigation is pending or threatened) challenging the use by any of the Loan
Parties or any of their Subsidiaries of any such IP Right or the validity or
effectiveness thereof, except for any such action, suit, investigation,
litigation, arbitration or proceeding that, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.

 

5.12         Margin Stock.  Neither any of the Loan Parties nor any of their
respective Subsidiaries is engaged, principally or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying any “margin stock” (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System (12 CFR 207)).  None of the proceeds of
any Borrowing or the drawings under any Letter of Credit will be used to
purchase or carry any margin stock or to extend credit to others for the purpose
of purchasing or carrying margin stock.

 

5.13         Investment Company Act, Etc.  Neither any of the Loan Parties nor
any of their Subsidiaries is an “investment company” or an “affiliated person”
of, or “promoter” or “principal underwriter” for, an “investment company” (each
as defined in the Investment Company Act of 1940, as amended).  None of the
making (or deemed making) of any Borrowing, the issuance (or deemed issuance) of
any Letter of Credit or the application of the proceeds therefrom, or the
repayment of any Borrowing by the Borrower, or the consummation of the Nu-Gro
Transaction, or the Holding Company Event (if and when consummated) or any of
the other transactions contemplated hereby, will violate any provision of the
Investment Company Act of 1940, as amended, or any rule, regulation or order of
the Securities and Exchange Commission thereunder.

 

5.14         Solvency.  The Borrower is, individually and together with its
Subsidiaries, taken as a whole, Solvent.

 

5.15         Labor Matters.  Except as, either individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect, there is
(a) no unfair labor practice complaint pending or, to the knowledge of the
Borrower, threatened against any of the Loan Parties or any of their
Subsidiaries by or before any Governmental Authority, and no grievance or
arbitration proceeding pending or, to the knowledge of the Borrower, threatened
against any of the Loan Parties or any of their Subsidiaries which arises out of
or under any collective bargaining agreement, (b) no strike, labor dispute,
slowdown, stoppage or similar action or grievance pending or, to the knowledge
of the Borrower, threatened against any of the Loan Parties or any of their
Subsidiaries and (c) to the knowledge of the Borrower, no union representation
question existing with respect to the employees of any of the Loan Parties or
any of their Subsidiaries and no union organizing activity taking place with
respect to any of the employees of any of them.

 

5.16         ERISA Matters.  No ERISA Event has occurred or could reasonably be
expected to occur that, either individually or in the aggregate, has had or
could reasonably be

 

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expected to have, a Material Adverse Effect.  Schedule B (Actuarial Information)
to the most recent annual report (Form 5500 series) for each of the Pension
Plans, copies of which have been filed with the Internal Revenue Service and
furnished or made available to the Lenders, is complete and accurate and fairly
presents in all material respects the funding status of such plan at such time;
and, to the knowledge of the Loan Parties, since the date of such Schedule B,
there has been no material adverse change in the funding status of such plan. 
Neither any of the Loan Parties nor any of the ERISA Affiliates (i) has incurred
any Withdrawal Liability to any Multiemployer Plan in excess of $1,000,000 or
(ii) has been notified by the sponsor of a Multiemployer Plan that such
Multiemployer Plan is in reorganization or has been terminated, within the
meaning of Title IV of ERISA, and, to the best knowledge of the Loan Parties and
the ERISA Affiliates, no such Multiemployer Plan could reasonably be expected to
be in reorganization or to be terminated, within the meaning of Title IV of
ERISA.

 

5.17         Environmental Compliance.  (a)  The operations and properties of
each of the Loan Parties and each of their Subsidiaries comply in all material
respects with all applicable Environmental Laws and Environmental Permits; all
past noncompliance with such Environmental Laws and Environmental Permits has
been resolved without any material ongoing obligations or costs; all
Environmental Permits that are necessary for the operations or properties of any
of the Loan Parties or any of their Subsidiaries have been obtained and are in
full force and effect, except where and to the extent that the failure to obtain
or maintain in full force and effect any such Environmental Permit, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect; and no circumstances exist that, either individually or
in the aggregate, could reasonably be expected to (i) form the basis of an
Environmental Action against any of the Loan Parties or any of their
Subsidiaries or any of the properties thereof that, either individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect or
(ii) cause any such property to be subject to any restrictions on ownership,
occupancy or use or on the transferability of such property that could
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.

 

(B)           EXCEPT AS DISCLOSED IN SCHEDULE 5.17, (I) NONE OF THE PROPERTIES
OWNED OR OPERATED BY ANY OF THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES IS
LISTED OR, TO THE ACTUAL KNOWLEDGE OF THE BORROWER, IS PROPOSED FOR LISTING ON
THE NPL OR ON THE CERCLIS OR ANY ANALOGOUS STATE OR LOCAL LIST; AND (II) EXCEPT
AS, EITHER INDIVIDUALLY OR IN THE AGGREGATE, COULD NOT REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT, (A) THERE ARE NO, AND NEVER HAVE BEEN ANY,
UNDERGROUND OR ABOVEGROUND STORAGE TANKS OR ANY SURFACE IMPOUNDMENTS, SEPTIC
TANKS, PITS, SUMPS OR LAGOONS IN WHICH HAZARDOUS MATERIALS ARE BEING OR HAVE
BEEN TREATED, STORED OR DISPOSED OF ON ANY PROPERTY OWNED OR OPERATED BY ANY OF
THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES OR, TO THE KNOWLEDGE OF THE
BORROWER, ON ANY PROPERTY FORMERLY OWNED OR OPERATED BY ANY OF THE LOAN PARTIES
OR ANY OF THEIR SUBSIDIARIES, (B) THERE IS NO ASBESTOS OR ASBESTOS-CONTAINING
MATERIAL ON ANY PROPERTY OWNED OR OPERATED BY ANY OF THE LOAN PARTIES OR ANY OF
THEIR SUBSIDIARIES AND (C) HAZARDOUS MATERIALS HAVE NOT BEEN RELEASED,
DISCHARGED OR DISPOSED OF ON ANY PROPERTY OWNED OR OPERATED BY ANY OF THE LOAN
PARTIES OR ANY OF THEIR SUBSIDIARIES.

 

(C)           EXCEPT AS DISCLOSED IN SCHEDULE 5.17, NEITHER ANY OF THE LOAN
PARTIES NOR ANY OF THEIR SUBSIDIARIES IS UNDERTAKING, AND HAS NOT COMPLETED,
EITHER INDIVIDUALLY OR TOGETHER WITH OTHER POTENTIALLY RESPONSIBLE PARTIES, ANY
INVESTIGATION OR ASSESSMENT OR REMEDIAL OR

 

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RESPONSE ACTION RELATING TO ANY ACTUAL OR THREATENED RELEASE, DISCHARGE OR
DISPOSAL OF HAZARDOUS MATERIALS AT ANY SITE, LOCATION OR OPERATION, EITHER
VOLUNTARILY OR PURSUANT TO THE ORDER OF ANY GOVERNMENTAL AUTHORITY OR THE
REQUIREMENTS OF ANY ENVIRONMENTAL LAW THAT, EITHER INDIVIDUALLY OR IN THE
AGGREGATE, COULD REASONABLY BE EXPECTED TO RESULT IN THE BORROWER OR ANY OF ITS
SUBSIDIARIES INCURRING ENVIRONMENTAL LIABILITY THAT COULD REASONABLY BE EXPECTED
TO RESULT IN A MATERIAL ADVERSE EFFECT.

 

5.18         Taxes.  (a)  Each of the Loan Parties and each of their
Subsidiaries have filed all federal and material state tax returns, reports and
statements, and all other material tax returns, reports and statements, required
to be filed and have paid or caused to be paid all federal and material state
and other taxes, assessments, levies, fees and other charges shown thereon (or
on any assessments received by any such Person or of which any such Person has
been notified) to be due and payable, together with applicable interest and
penalties, except for any such taxes, assessments, levies, fees and other
charges (i) the amount, applicability or validity of which is being contested in
good faith and by appropriate proceedings diligently conducted and with respect
to which the applicable Loan Party or Subsidiary or Affiliate of a Loan Party,
as the case may be, has established appropriate and adequate reserves in
accordance with GAAP or (ii) with respect to which the failure to make such
filing or payment could not reasonably be expected to have a Material Adverse
Effect.

 

(B)           SET FORTH ON SCHEDULE 5.18 HERETO IS A COMPLETE AND ACCURATE LIST,
AS OF THE DATE OF THIS AGREEMENT, OF EACH OF THE OPEN YEARS OF EACH OF THE LOAN
PARTIES AND EACH OF THEIR SUBSIDIARIES.  NO ISSUES HAVE BEEN RAISED BY THE
INTERNAL REVENUE SERVICE IN RESPECT OF OPEN YEARS OF ANY OF THE LOAN PARTIES OR
ANY OF THEIR SUBSIDIARIES OR BY ANY SUCH FOREIGN, STATE OR LOCAL TAXATION
AUTHORITIES OR OTHER GOVERNMENTAL AUTHORITIES THAT, EITHER INDIVIDUALLY OR IN
THE AGGREGATE, COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT. 
NEITHER ANY OF THE LOAN PARTIES NOR ANY OF THEIR SUBSIDIARIES HAS ENTERED INTO
AN AGREEMENT OR WAIVER OR BEEN REQUESTED TO ENTER INTO AN AGREEMENT OR WAIVER
EXTENDING ANY STATUTE OF LIMITATIONS RELATING TO THE ASSESSMENT, REASSESSMENT,
PAYMENT OR COLLECTION OF TAXES OF ANY LOAN PARTY OR ANY SUCH SUBSIDIARY, OR IS
AWARE OF ANY CIRCUMSTANCES THAT WOULD CAUSE THE TAXABLE YEARS OR OTHER TAXABLE
PERIODS OF ANY LOAN PARTY OR ANY SUCH SUBSIDIARY TO NO LONGER BE SUBJECT TO THE
NORMALLY APPLICABLE STATUTE OF LIMITATIONS.

 

5.19         Real Estate.  Set forth on (i) Part A of Schedule 5.19 hereto is a
complete and accurate list as of the date of this Agreement or as of the date of
the most recent amendment, supplement or other modification to Schedule 5.19
hereto (pursuant to Section 6.13(f)) of all real property owned by the Borrower
or any of its Subsidiaries, showing as of such date, the street address, county
or other relevant jurisdiction, state, record owner and book and estimated fair
value thereof and (ii) Part B of Schedule 5.19 hereto is a complete and accurate
list as of the date of this Agreement or as of the date of the most recent
amendment, supplement or other modification to Schedule 5.19 hereto (pursuant to
Section 6.13(f)) of all leases of real property under which any of the Loan
Parties or any of their Subsidiaries is the lessee, showing as of such date, the
street address, state, lessor and lessee thereof.  The Borrower and each of its
Subsidiaries have good and indefeasible fee simple title to all of the real
property set forth on Part A of Schedule 5.19 hereto, free and clear of all
Liens other than Liens created or permitted under the Loan Documents, except for
any such real property that has been sold, leased, transferred or otherwise
disposed of in accordance with the terms of the Loan Documents.  All of

 

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the leases referred to on Schedule 5.19 hereto are valid and subsisting and in
full force and effect, unless such lease has lapsed, terminated or been canceled
in accordance with the terms of the Loan Documents, except where failure of such
leases to be valid and subsisting and in full force and effect could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

ARTICLE VI
AFFIRMATIVE, REPORTING AND FINANCIAL COVENANTS

 

Until the Termination Date, each of Holdings and the Borrower will, at all
times:

 

6.01         Compliance with Laws, Maintenance of Governmental Authorizations,
Etc.  (a) Comply, and cause each of its Subsidiaries to comply, with all
applicable Requirements of Law, such compliance to include, without limitation,
compliance with ERISA, with the Racketeer Influenced and Corrupt Organizations
Chapter of the Organized Crime Control Act of 1970 and with the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001, Pub. L.107-57 and all other laws and regulations
relating to money laundering and terrorist activities except to the extent the
failure of such Person to comply with any of the foregoing could not
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect and (b) except as provided in Section 6.05, obtain and maintain
in effect all Governmental Authorizations that are necessary (i) to own or lease
and operate their respective property and assets and to conduct their respective
businesses as now conducted, except where and to the extent that the failure to
obtain or maintain in effect any such Governmental Authorization, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect, or (ii) for the due execution, delivery or performance
by the Borrower or any of its Subsidiaries of any of the Loan Documents to which
it is a party, or for the consummation of any aspect of the Transaction or any
of the other transactions contemplated hereby and thereby.  This Section 6.01
shall not apply to compliance with Environmental Laws or Environmental Permits
(which are the subject of Section 6.03).

 

6.02         Payment of Taxes, Etc.  Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, to the extent due and payable and before the
same shall become delinquent, (a) all material taxes, assessments,
reassessments, levies and other governmental charges imposed upon it or upon its
property, assets or income and (b) all lawful claims that, if unpaid, might by
law become a Lien upon its property and assets or any part thereof; provided,
however, that neither the Borrower nor any of its Subsidiaries shall be required
to pay or discharge any such tax, assessment, reassessment, levy, charge or
claim (i) the amount, applicability or validity of which is being contested in
good faith and by proper proceedings diligently conducted and as to which
appropriate and adequate reserves are being maintained by the Borrower or its
applicable Subsidiary in accordance with GAAP and (ii) except, in each case, to
the extent that the failure to pay or discharge which tax, assessment,
reassessment, levy, charge or claim could not, individually or when aggregated
with all other unpaid amounts of a type referred to in this Section 6.02,
reasonably be expected to have a Material Adverse Effect.

 

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6.03         Compliance with Environmental Laws.  (a) Comply (and use
commercially reasonable efforts to require that all lessees and other Persons
operating or occupying any of the Subsidiaries’ properties to comply), and cause
each of its Subsidiaries to comply (and to use commercially reasonable efforts
to require all lessees and other Persons operating or occupying any of the
Subsidiaries’ properties to comply), in all material respects, with all
Environmental Laws and the Environmental Permits applicable to such Person or
its operations or properties; (b) obtain and renew, and cause each of its
Subsidiaries to obtain and renew, all of the Environmental Permits necessary for
the ownership or operation of their respective properties or the conduct of
their respective businesses as now conducted and as proposed to be conducted;
and (c) conduct, and cause each of its Subsidiaries to conduct, any
investigation, study, sampling or testing, and undertake, and cause each of its
Subsidiaries to undertake, any cleanup, removal, remedial or other action,
necessary to remove and clean up releases of the Hazardous Materials from any of
its properties in accordance with the requirements of all applicable
Environmental Laws, except, in the case of clause (b) or (c) of this
Section 6.03, where the failure to obtain or renew any such Environmental
Permit, to conduct any such investigation, study, sampling or testing or to
undertake any such cleanup, removal, remedial or other action, either
individually or in the aggregate, could not reasonably be expected (i) to have a
Material Adverse Effect or (ii) to subject any Loan Party or any of its
Subsidiaries to any criminal penalty or liability or (iii) to subject the
Administrative Agent or any of the Lenders to any criminal penalty or liability
or (except for nonmaterial fines for which the Administrative Agent or such
Lender is fully indemnified under Section 10.05) any civil penalty or liability;
provided, however, that no Loan Party nor any of their Subsidiaries shall be
required to undertake any such cleanup, removal, remedial or other action
otherwise required under this Section 6.03 to the extent that the amount,
applicability or validity thereof is being contested in good faith and by proper
proceedings diligently conducted and appropriate and adequate reserves are being
maintained by such Loan Party or such applicable Subsidiary with respect to such
circumstances in accordance with GAAP.

 

6.04         Maintenance of Insurance.  Maintain, and cause each of its
Subsidiaries to maintain, insurance for their respective properties, assets and
businesses with financially sound and reputable insurance companies or
associations and of such types (including, without limitation, insurance against
theft and fraud and against loss or damage by fire, explosion or hazard of or to
property and general public liability insurance), in such amounts and with such
deductibles, covering such casualties and contingencies and otherwise on such
terms as are at least as favorable as those usually carried by companies of
established reputations engaged in similar businesses and owning similar
properties and assets in the same general areas in which the Borrower or its
applicable Subsidiary operates or as may otherwise be required by applicable
Requirements of Law; provided, however, that each Loan Party and their
Subsidiaries may effect workers’ compensation insurance or similar coverage with
respect to their respective operations in any particular jurisdiction through an
insurance fund operated by such jurisdiction or by meeting the self-insurance
requirements of such jurisdiction so long as the Borrower, Holdings or such
Subsidiary establishes and maintains appropriate and adequate reserves therefor
in accordance with GAAP.

 

6.05         Preservation of Corporate Existence, Etc.  Preserve and maintain,
and cause each of its Subsidiaries to preserve and maintain, its legal
existence, organization, rights (statutory and pursuant to its Constitutive
Documents), permits, licenses, approvals, privileges

 

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and franchises; provided, however that the Borrower and its Subsidiaries (i) may
consummate any merger or consolidation otherwise permitted under Section 7.03
and (ii) may amend, supplement or otherwise modify their rights under their
respective Constitutive Documents to the extent otherwise permitted under
Section 7.12; and provided further, however, that neither the Borrower nor any
of its Subsidiaries shall be required to preserve any right, permit, license,
approval, privilege or franchise if the loss thereof, either individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

 

6.06         Visitation Rights.  At any reasonable time and from time to time,
permit any of the Agents or any of the Lenders, or any agents or representatives
thereof (so long as such agents or representatives are or agree to be bound by
the provisions of Section 10.08), to examine and make copies of and abstracts
from the records and books of account of, and to visit the properties of, the
Borrower and its Subsidiaries and to discuss the affairs, finances and accounts
of the Borrower and/or any of its Subsidiaries with any of their officers or
directors and with their independent auditors; provided, that, excluding any
such visits and inspections during the continuation of an Event of Default, only
the Administrative Agent on behalf of the Lenders may exercise rights under this
Section 6.06 and the Administrative Agent shall not exercise such rights more
often than two (2) times during any calendar year absent the existence of an
Event of Default and only one (1) such time shall be at the Borrower’s expense;
provided, further that when an Event of Default exists the Administrative Agent
or any Lender (or any of their respective representatives or independent
contractors) may do any of the foregoing at the expense of the Borrower at any
time and from time to time without limitation and without advance notice, except
that any such visits shall be done during normal business hours.  The
Administrative Agent and the Lenders shall give the Borrower the opportunity to
participate in any discussions with the Borrower’s accountants.

 

6.07         Keeping of Books.  Keep, and cause each of its Subsidiaries to
keep, proper books of record and account in which full and accurate entries
shall be made of all of the financial transactions and the property, assets and
businesses of the Borrower and each of its Subsidiaries (including, without
limitation, the establishment and maintenance of adequate and appropriate
reserves) in accordance with GAAP.

 

6.08         Maintenance of Properties, Etc.  (a)  Maintain and preserve, and
cause each of its Subsidiaries to maintain and preserve, all of its material
properties that, either individually or in the aggregate, are necessary in the
conduct of its business in good working order and condition, ordinary wear and
tear and casualty and condemnation excepted, and (b) make, and cause each of its
Subsidiaries to make, from time to time, all repairs, renewals, additions,
replacements, betterments and improvements of such properties in accordance with
prudent industry practice.

 

6.09         Compliance with Terms of Leaseholds.  Make all payments and
otherwise perform all obligations in respect of all leases of real property to
which the Borrower or any of its Subsidiaries is a party, keep such leases in
full force and effect and not allow such leases to lapse or to be terminated or
any rights to renew such leases to be forfeited or canceled, in each case except
to the extent that such nonperformance, lapse, termination, forfeiture or
cancellation, either individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.

 

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6.10         Transactions with Affiliates.  Conduct, and cause each of its
Subsidiaries to conduct, directly or indirectly, all transactions or series of
related transactions (including, without limitation, the purchase, sale, lease,
transfer or exchange of property or assets of any kind or the rendering of
services of any kind) otherwise permitted under the Loan Documents with any of
their Affiliates on terms that are fair and reasonable and no less favorable to
the Borrower (or upon consummation of the Holding Company Event, Holdings) or
any of its Subsidiaries than it would obtain in a comparable arm’s-length
transaction with a Person not an Affiliate thereof, other than:

 

(A)           THE PERFORMANCE BY THE BORROWER AND ITS SUBSIDIARIES OF ITS
OBLIGATIONS UNDER THE NU-GRO ACQUISITION DOCUMENTS, IN EACH CASE AS IN EFFECT ON
THE CLOSING DATE OR AS THE SAME MAY BE AMENDED PURSUANT TO SECTION 7.14;

 

(B)           THE PAYMENT OF MANAGEMENT FEES TO THE SPONSOR PURSUANT TO THE
TERMS OF THE PROFESSIONAL SERVICES AGREEMENT, AS IN EFFECT ON THE CLOSING DATE,
IN AN AGGREGATE AMOUNT NOT TO EXCEED $1,000,000 IN ANY FISCAL YEAR;

 

(C)           THE PAYMENT OF NONRECURRING TRANSACTION FEES TO THE SPONSOR IN
CONNECTION WITH ANY PURCHASE OR OTHER ACQUISITION OF A PERSON, SUBSTANTIALLY ALL
OR ALL OF THE ASSETS OF A PERSON OR A LINE OF BUSINESS OR DIVISION OF A PERSON
BY ANY LOAN PARTY OR ANY OF THEIR SUBSIDIARIES IN AN AMOUNT NOT TO EXCEED 1% OF
THE TOTAL CONSIDERATION BEING PAID BY SUCH LOAN PARTY AND ITS RESPECTIVE
SUBSIDIARIES FOR SUCH PURCHASE OR OTHER ACQUISITION, SUCH FEE, IN EACH CASE, TO
BE PAYABLE IN FULL UPON THE CONSUMMATION OF THE RELATED PURCHASE OR OTHER
ACQUISITION;

 

(D)           ANY TRANSACTION OR SERIES OF RELATED TRANSACTIONS SOLELY BETWEEN
OR AMONG (I) HOLDINGS OR THE BORROWER, ON THE ONE HAND, AND ONE OR MORE OF THE
RESTRICTED SUBSIDIARIES ON THE OTHER HAND, (II) ONE OR MORE OF THE RESTRICTED
SUBSIDIARIES, OR (III) ONE OR MORE OF THE UNRESTRICTED SUBSIDIARIES, ON THE ONE
HAND, AND HOLDINGS, THE BORROWER OR ANY RESTRICTED SUBSIDIARY, ON THE OTHER
HAND, IN THE CASE OF THIS CLAUSE (III) TO THE EXTENT SUCH TRANSACTION OR SERIES
OF RELATED TRANSACTIONS IS NOT OTHERWISE PROHIBITED UNDER THE TERMS OF THE LOAN
DOCUMENTS;

 

(E)           EQUITY ISSUANCES BY HOLDINGS NOT PROHIBITED BY THIS AGREEMENT;

 

(F)            CUSTOMARY FEES MAY BE PAID TO ANY DIRECTORS OF HOLDINGS AND
REIMBURSEMENT MAY BE MADE OF REASONABLE OUT-OF-POCKET COSTS OF THE DIRECTORS OF
HOLDINGS;

 

(G)           EACH LOAN PARTY AND THEIR RESPECTIVE SUBSIDIARIES MAY ENTER INTO
EMPLOYMENT AND SEVERANCE ARRANGEMENTS WITH THEIR RESPECTIVE OFFICERS AND
EMPLOYEES IN THE ORDINARY COURSE OF BUSINESS;

 

(H)           EACH LOAN PARTY AND THEIR RESPECTIVE SUBSIDIARIES MAY PERFORM
OBLIGATIONS UNDER ANY EMPLOYMENT CONTRACT, COLLECTIVE BARGAINING AGREEMENT,
EMPLOYEE BENEFIT PLAN, RELATED TRUST AGREEMENT OR ANY OTHER SIMILAR ARRANGEMENT
HERETOFORE OR HEREAFTER ENTERED INTO IN THE ORDINARY COURSE OF BUSINESS AND NOT
OTHERWISE PROHIBITED HEREUNDER;

 

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(I)            EACH LOAN PARTY AND THEIR RESPECTIVE SUBSIDIARIES MAY MAINTAIN
BENEFIT PROGRAMS OR ARRANGEMENTS FOR THEIR RESPECTIVE EMPLOYEES, OFFICERS OR
DIRECTORS, INCLUDING, WITHOUT LIMITATION, VACATION PLANS, HEALTH AND LIFE
INSURANCE PLANS, DEFERRED COMPENSATION PLANS, AND RETIREMENT OR SAVINGS PLANS
AND SIMILAR PLANS, IN EACH CASE, IN THE ORDINARY COURSE OF BUSINESS AND NOT
OTHERWISE PROHIBITED HEREUNDER;

 

(J)            EACH LOAN PARTY AND THEIR RESPECTIVE SUBSIDIARIES MAY MAKE
PAYMENTS PURSUANT TO ANY CUSTOMARY TAX SHARING ARRANGEMENT AMONG THE BORROWER
(OR UPON THE CONSUMMATION OF THE HOLDING COMPANY EVENT, HOLDINGS) AND ITS
SUBSIDIARIES ENTERED INTO IN THE ORDINARY COURSE OF BUSINESS; AND

 

(K)           EACH LOAN PARTY AND ITS RESPECTIVE SUBSIDIARIES MAY MAKE LOANS AND
ADVANCES TO ITS RESPECTIVE EMPLOYEES, OFFICERS AND DIRECTORS TO THE EXTENT
PERMITTED UNDER ARTICLE VII.

 

6.11         Covenant to Give Security.  (a)  Upon (i) the request of the
Administrative Agent following the occurrence and during the continuance of a
Default under Section 8.01(a) or 8.01(f) or an Event of Default, (ii) the
formation or acquisition of one or more new direct or indirect Subsidiaries by
any Loan Party or (iii) the purchase or other acquisition of any real property
or any personal property by any Loan Party with a value in excess of $2,500,000
in any single transaction or series of related transactions, which property, in
the reasonable judgment of the Administrative Agent, shall not already be
subject to a valid and perfected lien and security interest in favor of the
Administrative Agent, for the benefit of the Secured Parties, the Borrower
shall, in each case at its own expense:

 

(A)          within thirty (30) days after such request or purchase or other
acquisition, or such longer period, up to an additional thirty (30) days, as the
Administrative Agent may agree, furnish to the Administrative Agent a
description of such real and personal properties of each of the Loan Parties and
their respective Subsidiaries in detail reasonably satisfactory to the
Administrative Agent;

 

(B)           in connection with the formation or acquisition of a Subsidiary,
within thirty (30) days after such formation or acquisition or such longer
period, not to exceed an additional sixty (60) days, as the Administrative Agent
may agree in its sole discretion, (A) cause each such Subsidiary that is not a
Foreign Subsidiary, and cause each direct and indirect parent of such Subsidiary
(if it has not already done so), to duly execute and deliver to the
Administrative Agent a Guaranty or Guarantee Supplement, guaranteeing the other
Loan Parties’ obligations under the Loan Documents, (B) deliver (or cause such
direct and indirect parent to deliver) certificates (if any) representing the
Pledged Interests of such Subsidiary accompanied by undated stock powers or
other appropriate instruments of transfer executed in blank and instruments
evidencing the Pledged Debt of such Subsidiary indorsed in blank to the
Administrative Agent, together with, if requested by the Administrative Agent,
Security Agreement Supplements with respect to the pledge of any Equity
Interests or Indebtedness, provided, that no more than 66% of the voting Equity
Interests of any first-tier Foreign

 

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Subsidiary shall be required to be pledged as Collateral, (C) duly execute and
deliver, and cause each such Subsidiary to duly execute and deliver, to the
Administrative Agent mortgages, collateral assignments, Security Agreement
Supplements and other security agreements, as specified by and in form and
substance reasonably satisfactory to the Administrative Agent, securing payment
of all of the Obligations of the applicable Loan Party or Subsidiary of a Loan
Party, as the case may be, under and in respect of the Loan Documents and
constituting liens on and security interests in all such real and personal
properties and (D) duly execute and deliver, and cause each such Subsidiary to
duly execute and deliver, Guarantee Supplements;

 

(C)           within thirty (30) days after such request or purchase or other
acquisition, or such longer period, not to exceed an additional sixty (60) days,
as the Administrative Agent may agree in its sole discretion, take, and cause
each such Subsidiary that is not a Foreign Subsidiary to take, whatever action
(including, without limitation, the recording of Mortgages, the filing of
Uniform Commercial Code financing statements and IP Security Agreements, the
giving of notices and the endorsement of notices on title documents) may be
necessary or in the reasonable opinion of the Administrative Agent advisable to
vest in the Administrative Agent (or in any co-agent, sub-agent or other
representative of the Administrative Agent designated by it) valid and
subsisting Liens on the real and personal properties purported to be subject to
the Mortgages, collateral assignments, Security Agreement Supplements and
security agreements delivered pursuant to this Section 6.11, enforceable against
all third parties in accordance with their terms;

 

(D)          within thirty (30) days after the request of the Administrative
Agent (or such longer period, not to exceed an additional sixty (60) days, as
the Administrative Agent in its sole discretion may permit), deliver to the
Administrative Agent a signed copy of opinions of counsel for the applicable
Loan Parties, addressed to the Administrative Agent and the other Secured
Parties and reasonably acceptable to the Administrative Agent, as to the matters
contained in subclauses (A), (B) and (C) of this Section 6.11, as to such
mortgages, collateral assignments, Security Agreement Supplements and security
agreements being legal, valid and binding obligations of each of the Loan
Parties party thereto, enforceable against such Loan Party in accordance with
their terms, as to such recordings, filings, notices, endorsements and other
actions being sufficient to create valid and perfected liens on and security
interests in such real and personal properties, and as to such other matters as
the Administrative Agent may reasonably request;

 

(E)           as promptly as practicable after the reasonable request of the
Administrative Agent, deliver to the Administrative Agent with respect to each
parcel of real property owned by the Loan Party or the Subsidiary of the Loan
Party (other than a Foreign Subsidiary) that is the subject of such request,
title reports, surveys and engineering, soils and other reports, and Phase I
environmental assessment reports, each in scope, form and substance reasonably

 

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satisfactory to the Administrative Agent, provided, however, that to the extent
that any of the Loan Parties or any of its Subsidiaries shall have otherwise
received any of the foregoing items with respect to such real property, such
items shall, promptly after the receipt thereof, be delivered to the
Administrative Agent;

 

(F)           upon the occurrence and during the continuance of a Default under
Section 8.01(a) or 8.01(f) or an Event of Default, promptly execute and deliver,
and cause each of its Subsidiaries to promptly execute and deliver, any and all
instruments and take, and cause each of its Subsidiaries to take, any and all
such other actions as may be necessary or as the Administrative Agent may deem
reasonably desirable in order to obtain and maintain from and after the time any
dividend or other distribution is paid or payable by any of the Subsidiaries of
any Loan Party a valid and perfected first priority lien on and security
interest in such dividend or other distribution; and

 

(G)           at any time and from time to time, promptly execute and deliver
any and all further instruments and documents and take all such other action as
may be necessary or as the Administrative Agent may deem reasonably desirable in
obtaining the full benefits of, or in perfecting and preserving the Liens
created under, such Mortgages, collateral assignments, Security Agreement
Supplements and security agreements.

 

(B)           NOTWITHSTANDING ANYTHING TO THE CONTRARY IN SECTION 6.11(A), THE
ADMINISTRATIVE AGENT SHALL NOT TAKE OR PERFECT, AS THE CASE MAY BE, A SECURITY
INTEREST IN THOSE ASSETS (AND SHALL NOT REQUEST THE PREPARATION OF SURVEYS, SOIL
REPORTS AND ENVIRONMENTAL SITE ASSESSMENTS) AS TO WHICH THE ADMINISTRATIVE AGENT
SHALL DETERMINE, IN ITS REASONABLE DISCRETION, THAT THE COST OF OBTAINING OR
PERFECTING SUCH LIEN (INCLUDING ANY MORTGAGE, STAMP, INTANGIBLES OR OTHER TAX,
OR OF OBTAINING SURVEYS, SOIL REPORTS OR ENVIRONMENTAL SITE ASSESSMENTS NOT
ALREADY AVAILABLE AT SUCH TIME) ARE EXCESSIVE IN RELATION TO THE BENEFIT TO THE
SECURED PARTIES OF THE SECURITY OR INFORMATION AFFORDED THEREBY.

 

6.12         Further Assurances.  Promptly upon the request of the
Administrative Agent, or any of the Lenders through the Administrative Agent, at
any time and from time to time, (a) correct, and cause each of its Subsidiaries
to promptly correct, any defect or error that may be discovered in any of the
Loan Documents or in the execution, acknowledgment, filing or recordation
thereof and (b) do, execute, acknowledge, deliver, record, re-record, file,
re-file, register and re-register any and all such further acts, deeds,
conveyances, pledge agreements, mortgages, deeds of trust, trust deeds,
collateral assignments, financing statements and continuations thereof,
termination statements, notices of assignment, transfers, certificates,
assurances and other instruments and take such further actions, and cause each
of its Subsidiaries promptly to do, execute, acknowledge, deliver, record,
re-record, file, re-file, register and re-register any and all such further
acts, deeds, conveyances, pledge agreements, mortgages, deeds of trust, trust
deeds, collateral assignments, financing statements and continuations thereof,
termination statements, notices of collateral assignments, transfers,
certificates, assurances and other instruments and take such further action, as
may be necessary or as the Administrative Agent, or any of the Lenders through
the Administrative Agent, may reasonably request from time to time in order
to (i) carry out more effectively the provisions and purposes of the Loan

 

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Documents or assure the Administrative Agent or the Lenders of their rights and
interests herein and therein, (ii) to the fullest extent permitted by applicable
law, subject any of the Loan Party’s or any of its Subsidiaries’ properties,
assets, rights or interests to the Liens now or hereafter intended to be covered
by any of the Collateral Documents, (iii) perfect and maintain the validity,
effectiveness and priority of any of the Collateral Documents and any of the
Liens intended to be created thereunder and (iv) assure, convey, grant, assign,
transfer, preserve, protect and confirm more effectively unto the Secured
Parties the rights granted or now or hereafter intended to be granted to the
Secured Parties under any of the Loan Documents or under any other instrument
executed in connection with any of the Loan Documents to which any Loan Party or
any of its Subsidiaries is or is to be a party, and cause each of its
Subsidiaries to do so.

 

6.13         Reporting Requirements.  Until the Termination Date, the Borrower
will furnish to the Administrative Agent:

 

(A)           DEFAULT NOTICES.  AS SOON AS POSSIBLE AND IN ANY EVENT WITHIN
THREE BUSINESS DAYS AFTER THE OCCURRENCE OF EACH DEFAULT OR ANY EVENT,
DEVELOPMENT OR OCCURRENCE THAT, EITHER INDIVIDUALLY OR IN THE AGGREGATE, COULD
REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT CONTINUING ON THE DATE
OF SUCH STATEMENT, A STATEMENT OF A RESPONSIBLE OFFICER OF THE BORROWER SETTING
FORTH THE DETAILS OF SUCH DEFAULT OR SUCH EVENT, DEVELOPMENT OR OCCURRENCE
(INCLUDING, WITHOUT LIMITATION, THE ANTICIPATED EFFECT THEREOF), THE PERIOD OF
TIME SUCH DEFAULT OR SUCH EVENT, DEVELOPMENT OR OCCURRENCE HAS EXISTED AND BEEN
CONTINUING AND THE ACTION THAT THE BORROWER HAS TAKEN AND/OR PROPOSES TO TAKE
WITH RESPECT THERETO.

 

(B)           QUARTERLY FINANCIALS.  AS SOON AS AVAILABLE AND IN ANY EVENT
WITHIN 45 DAYS AFTER THE END OF EACH OF THE FIRST THREE FISCAL QUARTERS OF EACH
FISCAL YEAR, COMMENCING WITH THE FISCAL QUARTER ENDING MARCH 31, 2004, A
CONSOLIDATED BALANCE SHEET OF THE BORROWER AND ITS SUBSIDIARIES AS OF THE END OF
SUCH FISCAL QUARTER AND CONSOLIDATED STATEMENTS OF INCOME, STOCKHOLDERS’ EQUITY
AND CASH FLOWS OF THE BORROWER AND ITS SUBSIDIARIES FOR THE PERIOD COMMENCING AT
THE END OF THE PREVIOUS FISCAL QUARTER AND ENDING WITH THE END OF SUCH FISCAL
QUARTER AND FOR THE PERIOD COMMENCING AT THE END OF THE PREVIOUS FISCAL YEAR AND
ENDING WITH THE END OF SUCH FISCAL QUARTER, SETTING FORTH IN COMPARATIVE FORM,
IN THE CASE OF EACH SUCH CONSOLIDATED BALANCE SHEET, THE CORRESPONDING FIGURES
AS OF THE LAST DAY OF THE CORRESPONDING PERIOD IN THE IMMEDIATELY PRECEDING
FISCAL YEAR AND, IN THE CASE OF EACH SUCH CONSOLIDATED STATEMENT OF INCOME OR
OPERATIONS, STOCKHOLDERS’ EQUITY AND CASH FLOWS, THE CORRESPONDING FIGURES FOR
THE CORRESPONDING PERIOD IN THE IMMEDIATELY PRECEDING FISCAL YEAR, ALL IN
REASONABLE DETAIL (IT BEING UNDERSTOOD THAT SUCH FINANCIAL STATEMENTS DELIVERED
PURSUANT TO THIS SUBSECTION (B) FOR THE FISCAL QUARTER ENDING MARCH 31, 2004
WILL NOT CONTAIN ANY INFORMATION WITH RESPECT TO NU-GRO AND ITS SUBSIDIARIES).

 

(C)           ANNUAL FINANCIALS.  AS SOON AS AVAILABLE AND IN ANY EVENT WITHIN
90 DAYS AFTER THE END OF EACH FISCAL YEAR, A COPY OF THE ANNUAL AUDIT REPORT FOR
SUCH FISCAL YEAR FOR THE BORROWER AND ITS SUBSIDIARIES, INCLUDING THEREIN THE
CONSOLIDATED BALANCE SHEETS OF THE BORROWER AND ITS SUBSIDIARIES AS OF THE END
OF SUCH FISCAL YEAR AND CONSOLIDATED STATEMENTS OF INCOME OR OPERATIONS,
STOCKHOLDERS’ EQUITY AND CASH FLOWS OF THE BORROWER

 

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AND ITS SUBSIDIARIES FOR SUCH FISCAL YEAR, ACCOMPANIED BY AN UNQUALIFIED OPINION
OR AN OPINION OTHERWISE REASONABLY ACCEPTABLE TO THE REQUIRED LENDERS OF
PRICEWATERHOUSECOOPERS LLP OR OTHER INDEPENDENT PUBLIC ACCOUNTANTS OF NATIONALLY
RECOGNIZED STANDING, SETTING FORTH IN COMPARATIVE FORM, IN THE CASE OF EACH SUCH
CONSOLIDATED BALANCE SHEET, THE CORRESPONDING FIGURES AS OF THE LAST DAY OF THE
IMMEDIATELY PRECEDING FISCAL YEAR, AND, IN THE CASE OF EACH SUCH CONSOLIDATED
STATEMENT OF INCOME OR OPERATIONS, STOCKHOLDERS’ EQUITY AND CASH FLOWS, THE
CORRESPONDING FIGURES FOR THE CORRESPONDING PERIOD IN THE IMMEDIATELY PRECEDING
FISCAL YEAR, TOGETHER WITH (I) A LETTER FROM PRICEWATERHOUSECOOPERS LLP OR SUCH
INDEPENDENT PUBLIC ACCOUNTANTS OF NATIONALLY RECOGNIZED STANDING STATING THAT,
IN THE COURSE OF THEIR REGULAR AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS OF
THE BORROWER AND ITS SUBSIDIARIES, WHICH AUDIT WAS CONDUCTED BY SUCH ACCOUNTANTS
IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS, SUCH ACCOUNTANTS HAVE
NOT OBTAINED ANY KNOWLEDGE THAT AN EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING UNDER SECTION 6.14 OR IF, IN THE OPINION OF SUCH ACCOUNTANTS, AN
EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING UNDER SECTION 6.14, A STATEMENT
AS TO THE STATUS AND NATURE THEREOF AND (II) IN THE EVENT OF ANY CHANGE IN THE
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES USED BY SUCH ACCOUNTANTS IN THE
PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS OF THE BORROWER AND ITS
SUBSIDIARIES REFERRED TO ABOVE IN THIS SECTION 6.13(C) FROM GAAP, SUCH
ACCOUNTANTS SHALL ALSO PROVIDE A REASONABLY DETAILED DESCRIPTION OF SUCH
CHANGES.

 

(D)           COMPLIANCE CERTIFICATE.  COMMENCING FOR THE FISCAL QUARTER ENDING
ON OR ABOUT SEPTEMBER 30, 2004, TOGETHER WITH EACH DELIVERY TO THE
ADMINISTRATIVE AGENT OF THE CONSOLIDATED FINANCIAL STATEMENTS OF THE BORROWER
AND ITS SUBSIDIARIES REFERRED TO IN SECTIONS 6.13(B) AND 6.13(C), A CERTIFICATE
IN SUBSTANTIALLY THE FORM OF EXHIBIT D HERETO (EACH, A “COMPLIANCE CERTIFICATE”)
OF A SENIOR FINANCIAL OFFICER, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO
THE ADMINISTRATIVE AGENT:

 

(I)            DULY CERTIFYING THAT, SUBJECT, IN THE CASE OF ANY SUCH
CONSOLIDATED FINANCIAL STATEMENTS DELIVERED TO THE ADMINISTRATIVE AGENT AND THE
LENDERS PURSUANT TO SECTION 6.13(B), TO THE ABSENCE OF FOOTNOTE DISCLOSURE AND
NORMAL YEAR-END AUDIT ADJUSTMENTS, (A) THE CONSOLIDATED FINANCIAL STATEMENTS OF
THE BORROWER AND ITS SUBSIDIARIES DELIVERED WITH SUCH CERTIFICATE FAIRLY PRESENT
IN ALL MATERIAL RESPECTS THE CONSOLIDATED FINANCIAL CONDITION OF THE BORROWER
AND ITS SUBSIDIARIES AS OF THE LAST DAY OF SUCH FISCAL QUARTER OR SUCH FISCAL
YEAR, AS THE CASE MAY BE, AND THE CONSOLIDATED RESULTS OF OPERATIONS AND CASH
FLOWS OF THE BORROWER AND ITS SUBSIDIARIES FOR THE FISCAL QUARTER OR THE FISCAL
YEAR ENDED ON SUCH DATE AND (B) THE CONSOLIDATED FINANCIAL STATEMENTS OF THE
BORROWER AND ITS SUBSIDIARIES DELIVERED WITH SUCH CERTIFICATE HAVE BEEN PREPARED
IN ACCORDANCE WITH GAAP (OR A RECONCILIATION STATEMENT HAS BEEN DELIVERED
TOGETHER THEREWITH CONFORMING SUCH CONSOLIDATED FINANCIAL STATEMENTS TO GAAP);

 

(II)           DULY CERTIFYING THAT NO DEFAULT HAS OCCURRED AND IS CONTINUING
OR, IF A DEFAULT HAS OCCURRED AND IS CONTINUING, A STATEMENT AS TO THE NATURE
THEREOF, THE PERIOD OF TIME SUCH DEFAULT HAS EXISTED AND BEEN CONTINUING AND THE
ACTION THAT THE BORROWER HAS TAKEN AND/OR PROPOSES TO TAKE WITH RESPECT THERETO;
PROVIDED, THAT IF SUCH COMPLIANCE CERTIFICATE DEMONSTRATES AN EVENT OF DEFAULT
IN RESPECT OF

 

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ANY COVENANT CONTAINED IN SECTION 6.14, THE EQUITY INVESTORS MAY DELIVER,
TOGETHER WITH SUCH COMPLIANCE CERTIFICATE, NOTICE OF THEIR INTENT TO CURE (A
“NOTICE OF INTENT TO CURE”) SUCH EVENT OF DEFAULT THROUGH CAPITAL CONTRIBUTIONS
OR THE PURCHASE OF EQUITY INTERESTS AS CONTEMPLATED PURSUANT TO SUBCLAUSE
(B)(XII) AND THE FINAL PROVISO OF THE DEFINITION OF “CONSOLIDATED EBITDA”;
PROVIDED FURTHER, THAT THE DELIVERY OF A NOTICE OF INTENT TO CURE SHALL IN NO
WAY AFFECT OR ALTER THE OCCURRENCE, EXISTENCE OR CONTINUATION OF ANY SUCH EVENT
OF DEFAULT OR THE RIGHTS, BENEFITS, POWERS AND REMEDIES OF THE ADMINISTRATIVE
AGENT AND THE LENDERS UNDER ANY LOAN DOCUMENT UNLESS AND UNTIL SUCH EVENT OF
DEFAULT HAS BEEN CURED AS A RESULT OF THE ACTION CONTEMPLATED BY SUCH NOTICE OF
INTENT TO CURE OR OTHERWISE;

 

(III)          SETTING FORTH A SCHEDULE OF THE COMPUTATIONS USED BY THE BORROWER
IN DETERMINING COMPLIANCE WITH THE COVENANTS CONTAINED IN SECTIONS 7.07 AND 6.14
(INCLUDING WITH RESPECT TO EACH SUCH SECTION, WHERE APPLICABLE, THE CALCULATIONS
OF THE MAXIMUM OR MINIMUM AMOUNT, RATIO OR PERCENTAGE, AS THE CASE MAY BE,
PERMISSIBLE UNDER THE TERMS OF SUCH SECTION, AND THE CALCULATION OF THE AMOUNT,
RATIO OR PERCENTAGE THEN IN EXISTENCE) AND, IN THE CASE OF ANY SUCH CONSOLIDATED
FINANCIAL STATEMENTS DELIVERED TO THE ADMINISTRATIVE AGENT AND THE LENDERS
PURSUANT TO SECTION 6.13(C), THE AMOUNT OF EXCESS CASH FLOW FOR THE FISCAL YEAR
COVERED THEREBY;

 

(IV)          IN THE CASE OF ANY SUCH CONSOLIDATED FINANCIAL STATEMENTS
DELIVERED TO THE ADMINISTRATIVE AGENT AND THE LENDERS PURSUANT TO SECTION
6.13(B), SETTING FORTH (A) A DESCRIPTION IN REASONABLE DETAIL OF ALL OF THE
CHANGES IN THE GENERALLY ACCEPTED ACCOUNTING PRINCIPLES APPLIED IN THE
PREPARATION OF SUCH FINANCIAL STATEMENTS FROM GAAP AND (B) A STATEMENT OF
RECONCILIATION, IF AND TO THE EXTENT NECESSARY FOR DETERMINING WHETHER ANY OF
THE CHANGES IN THE GENERALLY ACCEPTED ACCOUNTING PRINCIPLES APPLIED IN THE
PREPARATION OF SUCH FINANCIAL STATEMENTS WOULD AFFECT THE CALCULATION OF, OR
COMPLIANCE WITH, SECTIONS 7.07 OR 6.14, CONFORMING SUCH CONSOLIDATED FINANCIAL
STATEMENTS TO GAAP; AND

 

(V)           COMMENCING UPON THE OCCURRENCE OF THE HOLDING COMPANY EVENT,
SETTING FORTH A SCHEDULE IN REASONABLE DETAIL OF THE COMPUTATIONS USED BY
HOLDINGS IN DETERMINING COMPLIANCE WITH THE PROVISIONS IN SECTION 7.02(C)(II).

 

(E)           FORECASTS.  AS SOON AS AVAILABLE AND IN ANY EVENT AT LEAST 30 DAYS
AFTER THE FIRST DAY OF EACH FISCAL YEAR, COMMENCING WITH THE FISCAL YEAR ENDING
DECEMBER 31, 2004, CONSOLIDATED FORECASTS PREPARED BY MANAGEMENT OF THE BORROWER
OF BALANCE SHEETS AND STATEMENTS OF INCOME, STOCKHOLDERS’ EQUITY AND CASH FLOWS
ON A QUARTERLY BASIS FOR SUCH FISCAL YEAR IN A FORM REASONABLY SATISFACTORY TO
THE ADMINISTRATIVE AGENT AND SETTING FORTH IN COMPARATIVE FORM THE CORRESPONDING
FIGURES FOR THE IMMEDIATELY PRECEDING FISCAL YEAR.

 

(F)            SCHEDULE UPDATES.  TOGETHER WITH EACH COMPLIANCE CERTIFICATE
DELIVERED PURSUANT TO SECTION 6.13(D), AMENDMENTS AND SUPPLEMENTS TO SCHEDULE
5.19 TO THIS AGREEMENT, SCHEDULES V AND VII TO THE SECURITY AGREEMENT AND SUCH
OTHER SCHEDULES TO ANY OF THE LOAN DOCUMENTS AS THE ADMINISTRATIVE AGENT SHALL
REASONABLY REQUEST, IN EACH

 

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CASE SO AS TO ENSURE THAT, AT THE TIME OF THE DELIVERY OF SUCH AMENDMENTS AND
SUPPLEMENTS, SUCH SCHEDULES ARE ACCURATE AND COMPLETE IN ALL MATERIAL RESPECTS
AS TO THE SUBJECT MATTER THEREOF.

 

(G)           ACCOUNTANTS’ LETTERS, ETC.  PROMPTLY UPON RECEIPT THEREOF, COPIES
OF ALL FINAL “MANAGEMENT RECOMMENDATION LETTERS” SUBMITTED TO ANY LOAN PARTY OR
ANY OF ITS SUBSIDIARIES BY ANY INDEPENDENT AUDITORS OF SUCH LOAN PARTY OR ANY OF
ITS SUBSIDIARIES IN CONNECTION WITH EACH ANNUAL AUDIT OF ITS CONSOLIDATED
FINANCIAL STATEMENTS MADE BY SUCH AUDITORS.

 

(H)           LICENSES, ETC.  PROMPTLY AND IN ANY EVENT WITHIN FIVE BUSINESS
DAYS AFTER RECEIPT THEREOF, NOTICE OF ANY ACTUAL, PENDING OR THREATENED
SUSPENSION, TERMINATION OR REVOCATION OF ANY OF THE GOVERNMENTAL AUTHORIZATIONS
OF ANY OF THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES, OR ANY ENJOINMENT,
BARRING OR SUSPENSION OF THE ABILITY OF THE OR ANY SUCH LOAN PARTY OR SUBSIDIARY
TO CONDUCT ANY OF ITS BUSINESSES IN THE ORDINARY COURSE, IN EACH CASE, THAT
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

(I)            LITIGATION.  PROMPTLY AND IN ANY EVENT WITHIN FIVE BUSINESS DAYS
AFTER THE SERVICE UPON ANY LOAN PARTY OR ANY OF ITS SUBSIDIARIES OF A PLEADING,
SUMMONS OR OTHER SERVICE OF PROCESS NOTIFYING IT OF THE COMMENCEMENT THEREOF,
NOTICE OF ALL ACTIONS, SUITS, INVESTIGATIONS, LITIGATION, ARBITRATIONS AND
PROCEEDINGS AGAINST OR AFFECTING SUCH LOAN PARTY OR ANY OF ITS SUBSIDIARIES OR
ANY OF THE PROPERTY OR ASSETS THEREOF IN ANY COURT OR BEFORE ANY ARBITRATOR OR
BY OR BEFORE ANY GOVERNMENTAL AUTHORITY OF ANY KIND IN WHICH THERE IS A
REASONABLE LIKELIHOOD OF AN ADVERSE DETERMINATION AND THAT, EITHER INDIVIDUALLY
OR IN THE AGGREGATE, COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE
EFFECT; AND PROMPTLY AFTER THE OCCURRENCE THEREOF, NOTICE OF ANY ADVERSE CHANGE
IN THE STATUS, OR IN THE REASONABLY ANTICIPATED FINANCIAL EFFECT ON SUCH LOAN
PARTY OR ANY OF ITS SUBSIDIARIES, OF ANY SUCH ACTION, SUIT, INVESTIGATION,
LITIGATION, ARBITRATION OR PROCEEDING (AND, IN EACH CASE, UPON THE REASONABLE
REQUEST OF THE ADMINISTRATIVE AGENT, ANY OTHER INFORMATION AVAILABLE TO ANY OF
THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES WITH RESPECT TO ANY OF THE
FOREGOING THAT WOULD ENABLE THE ADMINISTRATIVE AGENT AND THE LENDERS TO MORE
FULLY EVALUATE SUCH ACTION, SUIT, INVESTIGATION, LITIGATION, ARBITRATION OR
PROCEEDING, UNLESS THE LOAN PARTY OR THE APPLICABLE SUBSIDIARY IS PRECLUDED FROM
DISCLOSING ANY SUCH REPORT OR STATEMENT PURSUANT TO A CONFIDENTIALITY AGREEMENT
WITH THE APPLICABLE GOVERNMENTAL AUTHORITY).

 

(J)            SECURITIES REPORTS, ETC.  PROMPTLY AND IN ANY EVENT WITHIN FIVE
BUSINESS DAYS AFTER THE SENDING OR FILING THEREOF, COPIES OF ALL PROXY
STATEMENTS, FINANCIAL STATEMENTS, CHANGE REPORTS AND OTHER REPORTS THAT ANY LOAN
PARTY OR ANY OF ITS SUBSIDIARIES SENDS TO ITS STOCKHOLDERS, PARTNERS OR MEMBERS
(OR EQUIVALENT PERSONS THERETO), AND COPIES OF ALL REGULAR, PERIODIC AND SPECIAL
REPORTS AND INFORMATION FORMS, AND ALL REGISTRATION STATEMENTS, PROSPECTUSES AND
INFORMATION MEMORANDA, THAT ANY LOAN PARTY OR ANY OF ITS SUBSIDIARIES FILES WITH
THE SECURITIES AND EXCHANGE COMMISSION OR ANY GOVERNMENTAL AUTHORITY THAT MAY BE
SUBSTITUTED THEREFOR, OR WITH ANY NATIONAL OR INTERNATIONAL SECURITIES EXCHANGE,
AND COPIES OF ALL PRIVATE PLACEMENT OR OFFERING MEMORANDA PURSUANT TO WHICH
SECURITIES OF SUCH LOAN PARTY OR SUBSIDIARY THAT ARE EXEMPT FROM REGISTRATION
UNDER THE SECURITIES ACT ARE PROPOSED TO BE ISSUED AND SOLD THEREBY.

 

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(K)           CREDITOR REPORTS.  PROMPTLY AFTER THE FURNISHING OR RECEIPT
THEREOF, COPIES OF ANY STATEMENT OR REPORT FURNISHED TO OR RECEIVED FROM ANY
OTHER HOLDER OF THE SECURITIES OF ANY LOAN PARTY OR ANY OF ITS SUBSIDIARIES
PURSUANT TO THE TERMS OF ANY INDENTURE, LOAN OR CREDIT AGREEMENT, RECEIVABLES
PURCHASE AGREEMENT OR SIMILAR AGREEMENT OF SUCH LOAN PARTY OR SUBSIDIARY WITH
AMOUNTS OUTSTANDING OR HAVING COMMITMENTS TO EXTEND CREDIT IN AN AGGREGATE
PRINCIPAL AMOUNT OF AT LEAST $20,000,000 (INCLUDING, WITHOUT LIMITATION, ANY
AMENDMENTS, WAIVERS OR CONSENTS GIVEN OR REQUESTED IN RESPECT THEREOF AND ANY
NOTICES OF DEFAULT, ACCELERATION OR REDEMPTION DELIVERED THEREUNDER) AND NOT
OTHERWISE REQUIRED TO BE FURNISHED TO THE ADMINISTRATIVE AGENT (FOR THE BENEFIT
OF THE LENDERS) PURSUANT TO ANY OTHER CLAUSE OF THIS SECTION 6.13.

 

(L)            ERISA EVENTS AND ERISA REPORTS; PLAN TERMINATIONS, ETC.  (I)
PROMPTLY AND IN ANY EVENT WITHIN 15 DAYS AFTER ANY OF THE LOAN PARTIES OR ANY OF
THE ERISA AFFILIATES KNOWS OR HAS REASON TO KNOW THAT ANY ERISA EVENT WHICH
COULD REASONABLY BE EXPECTED TO RESULT IN A MATERIAL LIABILITY HAS OCCURRED, A
STATEMENT OF A RESPONSIBLE OFFICER OF THE BORROWER DESCRIBING SUCH MATERIAL
ERISA EVENT AND THE ACTION, IF ANY, THAT THE BORROWER, SUCH OTHER APPLICABLE
LOAN PARTY OR SUCH ERISA AFFILIATE HAS TAKEN AND/OR PROPOSES TO TAKE WITH
RESPECT THERETO, TOGETHER WITH MATERIALS OR INFORMATION FILED OR TO BE FILED
WITH ANY GOVERNMENTAL AUTHORITY OR ANY TRUSTEE FOR ANY PLAN AS A RESULT OF SUCH
MATERIAL ERISA EVENT; (II) ON THE DATE ON WHICH ANY RECORDS, DOCUMENTS OR OTHER
INFORMATION MUST BE FURNISHED TO THE PBGC WITH RESPECT TO ANY PLAN PURSUANT TO
SECTION 4010 OF ERISA, A COPY OF SUCH RECORDS, DOCUMENTS AND INFORMATION; (III)
PROMPTLY AND IN ANY EVENT WITHIN FIVE (5) BUSINESS DAYS AFTER RECEIPT THEREOF BY
ANY OF THE LOAN PARTIES OR ANY OF THE ERISA AFFILIATES, COPIES OF EACH NOTICE
FROM THE PBGC STATING ITS INTENTION TO TERMINATE ANY PENSION PLAN OR TO HAVE A
TRUSTEE APPOINTED TO ADMINISTER ANY PENSION PLAN; (IV) PROMPTLY FOLLOWING THE
REQUEST OF THE ADMINISTRATIVE AGENT, OR ANY OF THE LENDERS THROUGH THE
ADMINISTRATIVE AGENT, THEREFOR, A COPY OF THE MOST RECENT SCHEDULE B (ACTUARIAL
INFORMATION) TO THE ANNUAL REPORT (FORM 5500) WITH RESPECT TO EACH OF THE
PENSION PLANS; AND (V) PROMPTLY AND IN ANY EVENT WITHIN 15 BUSINESS DAYS AFTER
RECEIPT THEREOF BY ANY OF THE LOAN PARTIES OR ANY OF THE ERISA AFFILIATES FROM
THE SPONSOR OF A MULTIEMPLOYER PLAN, COPIES OF EACH NOTICE CONCERNING (A) THE
IMPOSITION OF WITHDRAWAL LIABILITY BY ANY SUCH MULTIEMPLOYER PLAN, (B) THE
REORGANIZATION OR TERMINATION, WITHIN THE MEANING OF TITLE IV OF ERISA, OF ANY
SUCH MULTIEMPLOYER PLAN OR (C) THE AMOUNT OF LIABILITY INCURRED, OR THAT COULD
REASONABLY BE EXPECTED TO BE INCURRED, BY SUCH LOAN PARTY OR ANY SUCH ERISA
AFFILIATE IN CONNECTION WITH ANY EVENT DESCRIBED IN SUBCLAUSE (V)(A) OR (V)(B)
OF THIS SECTION 6.13(L).

 

(M)          “REPORTABLE TRANSACTION” NOTIFICATION.  THE BORROWER SHALL PROMPTLY
NOTIFY THE ADMINISTRATIVE AGENT OF ANY DETERMINATION BY THE BORROWER TO TREAT
THE LOANS AND/OR THE RELATED TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT AS A
“REPORTABLE TRANSACTION” (WITHIN THE MEANING OF TREASURY REGULATION SECTION
1.6011-4), AND SHALL PROVIDE THE ADMINISTRATIVE AGENT (WITHIN FIVE BUSINESS DAYS
OF SUCH DETERMINATION) WITH A DULY COMPLETED COPY OF IRS FORM 8886 OR ANY
SUCCESSOR FORM.

 

(N)           ENVIRONMENTAL CONDITIONS.  PROMPTLY AND IN ANY EVENT WITHIN TEN
BUSINESS DAYS AFTER THE ASSERTION OR OCCURRENCE THEREOF:

 

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(I)            NOTICE OF ANY CONDITION OR OCCURRENCE ON OR ARISING FROM ANY
PROPERTY OWNED OR OPERATED BY THE BORROWER OR ANY OF ITS SUBSIDIARIES THAT
RESULTED OR IS ALLEGED TO HAVE RESULTED IN NONCOMPLIANCE IN ANY MATERIAL RESPECT
BY THE BORROWER OR SUCH SUBSIDIARY WITH ANY APPLICABLE ENVIRONMENTAL LAW OR
ENVIRONMENTAL PERMIT;

 

(II)           ANY CONDITION OR OCCURRENCE ON ANY PROPERTY OWNED OR OPERATED BY
THE BORROWER OR ANY OF ITS SUBSIDIARIES THAT COULD REASONABLY BE EXPECTED TO
CAUSE SUCH PROPERTY TO BE SUBJECT TO ANY MATERIAL RESTRICTIONS ON THE OWNERSHIP,
OCCUPANCY OR USE THEREOF OR ON THE TRANSFERABILITY OF SUCH PROPERTY BY THE
BORROWER OR ITS APPLICABLE SUBSIDIARY UNDER ANY ENVIRONMENTAL LAW; AND

 

(III)          THE TAKING OF ANY REMOVAL OR REMEDIAL ACTION INVOLVING MATERIAL
COSTS OR LIABILITIES IN RESPONSE TO THE ACTUAL OR ALLEGED PRESENCE OF ANY
HAZARDOUS MATERIAL ON ANY PROPERTY OWNED OR OPERATED BY THE BORROWER OR ANY OF
ITS SUBSIDIARIES AS REQUIRED BY ANY ENVIRONMENTAL LAW, ANY ENVIRONMENTAL PERMIT
OR ANY GOVERNMENTAL AUTHORITY.

 

All such notices shall describe in reasonable detail the nature of the
condition, occurrence, removal or remedial action described therein, the period
of time such condition or circumstance has existed and been continuing and, in
the case of each such condition or occurrence, the action that the Borrower or
its applicable Subsidiary has taken and/or proposes to take with respect
thereto.

 

(O)           INSURANCE.  AS SOON AS AVAILABLE AND IN ANY EVENT WITHIN 90 DAYS
AFTER THE END OF EACH FISCAL YEAR, COMMENCING WITH THE FISCAL YEAR ENDING
DECEMBER 31, 2004, A REPORT SUMMARIZING THE INSURANCE COVERAGE IN EFFECT FOR THE
LOAN PARTIES AND THEIR RESPECTIVE SUBSIDIARIES, SPECIFYING THEREIN THE TYPE,
CARRIER, AMOUNT, DEDUCTIBLES AND CO-INSURANCE REQUIREMENTS AND EXPIRATION DATES
THEREOF AND CONTAINING SUCH ADDITIONAL INFORMATION AS ANY OF THE LENDERS,
THROUGH THE ADMINISTRATIVE AGENT, MAY REASONABLY REQUEST.

 

(P)           OTHER INFORMATION.  SUCH OTHER INFORMATION RESPECTING THE
BUSINESS, CONDITION (FINANCIAL OR OTHERWISE), OPERATIONS, LIABILITIES (ACTUAL OR
CONTINGENT), PERFORMANCE, PROPERTIES OR PROSPECTS OF THE BORROWER OR ANY OF ITS
SUBSIDIARIES AS ANY OF THE LENDERS, THROUGH THE ADMINISTRATIVE AGENT, MAY FROM
TIME TO TIME REASONABLY REQUEST.

 

6.14         Financial Covenants.  Until the Termination Date, the Borrower
will:

 

(A)           TOTAL LEVERAGE RATIO.  MAINTAIN A TOTAL LEVERAGE RATIO AS OF THE
LAST DAY OF EACH MEASUREMENT PERIOD SET FORTH BELOW OF NOT MORE THAN THE AMOUNT
SET FORTH BELOW FOR EACH MEASUREMENT PERIOD SET FORTH BELOW:

 

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For Each Measurement
Period Ending During the
Period:

 

Ratio

 

From September 30, 2004 through Fiscal Quarter ending March 31, 2005

 

6.25:1.00

 

From April 1, 2005 through Fiscal Quarter ending September 30, 2005

 

6.00:1.00

 

From October 1, 2005 through Fiscal Quarter ending September 30, 2006

 

5.50:1.00

 

From October 1, 2006 through Fiscal Quarter ending September 30, 2007

 

4.75:1.00

 

From October 1, 2007 through Fiscal Quarter ending September 30, 2008

 

4.25:1.00

 

Each Fiscal Quarter thereafter

 

3.75:1.00

 

 

(B)           INTEREST COVERAGE RATIO.  MAINTAIN AN INTEREST COVERAGE RATIO AS
OF THE LAST DAY OF EACH MEASUREMENT PERIOD SET FORTH BELOW OF NOT LESS THAN THE
AMOUNT SET FORTH BELOW FOR EACH MEASUREMENT PERIOD SET FORTH BELOW:

 

For Each Measurement
Period Ending During
the Period

 

Ratio

 

From September 30, 2004 through Fiscal Quarter ending September 30, 2005

 

2.25:1.00

 

From October 1, 2005 through Fiscal Quarter ending September 30, 2006

 

2.50:1.00

 

From October 1, 2006 through Fiscal Quarter ending September 30, 2007

 

2.75:1.00

 

From October 1, 2007 through Fiscal Quarter ending September 30, 2008

 

3.00:1.00

 

Each Fiscal Quarter thereafter

 

3.25:1.00

 

 

6.15         Post-Closing Matters.  Upon the occurrence of the Holding Company
Event, Holdings shall (i) execute and deliver a Holdings Joinder Agreement and
Guaranty in substantially the form of Exhibit K hereto (the “Holdings Joinder
and Guaranty”) and a

 

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Security Agreement Supplement, (ii) deliver certificates representing the
Pledged Interests of Holdings in the Borrower, and (iii) have taken each such
other action that would be required in respect of a newly-formed Subsidiary of
the Borrower under Section 6.11(a) (without regard to any time period specified
therein), including, without limitation, delivery of an opinion of counsel to
Holdings on the terms set forth in clause (a)(D) of Section 6.11.

 

ARTICLE VII
NEGATIVE COVENANTS

 

Until the Termination Date, neither Holdings nor the Borrower shall, at any
time:

 

7.01         Liens, Etc.  Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist, any Lien on
or with respect to any of its property or assets of any character (including,
without limitation, accounts), whether now owned or hereafter acquired, or sign
or file or authorize, or permit any of its Subsidiaries to sign or file or
authorize, under the Uniform Commercial Code or any similar Requirements of Law
of any jurisdiction, a financing statement (or the equivalent thereof) that
names Holdings or any of its Subsidiaries as debtor, or sign or authorize, or
permit any of its Subsidiaries to sign or authorize, any security agreement
authorizing any secured party thereunder to file any such financing statement
(or the equivalent thereof), excluding, however, from the operation of the
foregoing restrictions:

 

(A)           LIENS CREATED UNDER THE LOAN DOCUMENTS;

 

(B)           PERMITTED LIENS;

 

(C)           LIENS EXISTING ON THE CLOSING DATE AND DESCRIBED ON SCHEDULE 7.01
HERETO;

 

(D)           (I) PURCHASE MONEY LIENS UPON OR IN REAL PROPERTY OR EQUIPMENT
ACQUIRED OR HELD BY THE BORROWER OR ANY OF ITS SUBSIDIARIES TO SECURE THE
PURCHASE PRICE OF SUCH REAL PROPERTY OR EQUIPMENT OR TO SECURE INDEBTEDNESS
INCURRED SOLELY FOR THE PURPOSE OF FINANCING THE ACQUISITION, CONSTRUCTION OR
IMPROVEMENT OF ANY SUCH REAL PROPERTY OR EQUIPMENT TO BE SUBJECT TO SUCH LIENS,
OR LIENS EXISTING ON ANY SUCH REAL PROPERTY OR EQUIPMENT AT THE TIME OF ITS
ACQUISITION OR THE COMPLETION OF ITS CONSTRUCTION OR IMPROVEMENT (OTHER THAN ANY
SUCH LIENS CREATED IN CONTEMPLATION OF SUCH ACQUISITION, CONSTRUCTION OR
IMPROVEMENT THAT DO NOT SECURE THE PURCHASE PRICE OF SUCH REAL PROPERTY OR
EQUIPMENT) AND (II) LIENS ARISING IN CONNECTION WITH CAPITALIZED LEASES;
PROVIDED, HOWEVER, THAT (A) NO SUCH LIEN UNDER THIS SUBCLAUSE (D) SHALL EXTEND
TO OR COVER ANY PROPERTY OR ASSETS OTHER THAN THE REAL PROPERTY OR EQUIPMENT
BEING SO ACQUIRED, CONSTRUCTED OR IMPROVED AND THE PRODUCTS AND PROCEEDS
THEREOF, (B) SUCH LIENS ATTACH CONCURRENTLY OR WITHIN 120 DAYS AFTER THE
ACQUISITION, REPAIR, REPLACEMENT OR IMPROVEMENT (AS APPLICABLE) OF THE PROPERTY
SUBJECT TO SUCH LIENS AND (C) ANY INDEBTEDNESS SECURED BY SUCH LIENS SHALL
OTHERWISE BE PERMITTED UNDER SECTION 7.02(B)(III);

 

(E)           LIENS UPON ANY OF THE PROPERTY AND ASSETS (OTHER THAN ANY EQUITY
INTERESTS IN ANY PERSON) EXISTING AT THE TIME SUCH PROPERTY OR ASSET IS
PURCHASED OR OTHERWISE ACQUIRED BY THE BORROWER OR ANY OF ITS SUBSIDIARIES;
PROVIDED THAT ANY SUCH LIEN WAS NOT CREATED IN CONTEMPLATION OF SUCH PURCHASE OR
OTHER ACQUISITION AND DOES NOT EXTEND TO

 

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OR COVER ANY PROPERTY OR ASSETS OTHER THAN THE PROPERTY OR ASSET BEING SO
PURCHASED OR OTHERWISE ACQUIRED AND THE PRODUCTS AND PROCEEDS THEREOF; AND
PROVIDED FURTHER THAT ANY INDEBTEDNESS OR OTHER OBLIGATIONS SECURED BY SUCH
LIENS SHALL OTHERWISE BE PERMITTED UNDER SECTION 7.02;

 

(F)            LIENS UPON ANY OF THE PROPERTY AND ASSETS (OTHER THAN ANY EQUITY
INTERESTS IN ANY PERSON) OF A PERSON AND ITS SUBSIDIARIES EXISTING AT THE TIME
SUCH PERSON IS MERGED INTO OR CONSOLIDATED WITH ANY OF THE SUBSIDIARIES OF THE
BORROWER, OR OTHERWISE BECOMES A SUBSIDIARY OF THE BORROWER, IN ACCORDANCE WITH
THE TERMS OF THE LOAN DOCUMENTS; PROVIDED THAT ANY SUCH LIEN WAS NOT CREATED IN
CONTEMPLATION OF SUCH MERGER, CONSOLIDATION OR ACQUISITION AND DOES NOT EXTEND
TO OR COVER ANY PROPERTY OR ASSETS OTHER THAN PROPERTY AND ASSETS AND THE
PRODUCTS AND PROCEEDS THEREOF OF THE PERSON AND ITS SUBSIDIARIES BEING SO MERGED
INTO OR CONSOLIDATED WITH THE APPLICABLE SUBSIDIARY OF THE BORROWER OR BEING
ACQUIRED BY THE BORROWER OR ITS APPLICABLE SUBSIDIARY, AS THE CASE MAY BE; AND
PROVIDED FURTHER THAT ANY INDEBTEDNESS OR OTHER OBLIGATIONS SECURED BY SUCH LIEN
SHALL OTHERWISE BE PERMITTED UNDER SECTION 7.02;

 

(G)           DEPOSITS MADE, AND LETTERS OF CREDIT ISSUED, TO SECURE THE
PERFORMANCE OF OPERATING LEASES OF THE BORROWER AND ITS SUBSIDIARIES IN THE
ORDINARY COURSE OF BUSINESS; PROVIDED THAT NO SUCH LIEN SHALL EXTEND TO OR COVER
ANY PROPERTY OR ASSETS OTHER THAN SUCH DEPOSIT OR SUCH LETTER OF CREDIT AND THE
PROPERTY AND ASSETS SUBJECT TO SUCH OPERATING LEASE, AS APPLICABLE;

 

(H)           LIENS ARISING SOLELY FROM PRECAUTIONARY FILINGS OF FINANCING
STATEMENTS UNDER THE UNIFORM COMMERCIAL CODE OF THE APPLICABLE JURISDICTIONS IN
RESPECT OF OPERATING LEASES ENTERED INTO BY THE BORROWER OR ANY OF ITS
SUBSIDIARIES IN THE ORDINARY COURSE;

 

(I)            LIENS UPON ANY OF THE PROPERTY AND ASSETS OF THE FOREIGN
SUBSIDIARIES TO SECURE INDEBTEDNESS OTHERWISE PERMITTED UNDER SECTION
7.02(B)(VI);

 

(J)            LIENS NOT OTHERWISE PERMITTED UNDER THIS SECTION 7.01 SECURING
OBLIGATIONS OF THE BORROWER AND ITS SUBSIDIARIES IN AN AGGREGATE AMOUNT NOT TO
EXCEED $30,000,000 AT ANY TIME OUTSTANDING;

 

(K)           THE MODIFICATION, REPLACEMENT, EXTENSION OR RENEWAL OF ANY LIEN
OTHERWISE PERMITTED TO BE CREATED OR TO EXIST UNDER CLAUSES (C), (E), (F) AND
(J) OF THIS SECTION 7.01 UPON OR IN THE SAME PROPERTY AND ASSETS THERETOFORE
SUBJECT THERETO; PROVIDED THAT NO SUCH EXTENSION, RENEWAL OR REPLACEMENT SHALL
EXTEND TO OR COVER ANY PROPERTY OR ASSETS NOT THERETOFORE SUBJECT TO THE LIEN
BEING EXTENDED, RENEWED OR REPLACED AND SHALL NOT SECURE ANY ADDITIONAL
INDEBTEDNESS OR OTHER OBLIGATIONS OTHER THAN (A) AFTER ACQUIRED PROPERTY THAT IS
AFFIXED OR INCORPORATED INTO THE PROPERTY COVERED BY SUCH LIEN AND (B) THE
PROCEEDS AND PRODUCTS THEREOF; AND PROVIDED FURTHER THAT ANY INDEBTEDNESS
SECURED BY SUCH LIENS SHALL OTHERWISE BE PERMITTED UNDER THE TERMS OF THE LOAN
DOCUMENTS; AND

 

(L)            DEPOSITS MADE, AND LETTERS OF CREDIT ISSUED, TO SECURE THE
PERFORMANCE OF TRADE CONTRACTS OF THE BORROWER AND ITS SUBSIDIARIES IN THE
ORDINARY COURSE OF BUSINESS.

 

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7.02         Indebtedness.  Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist, any
Indebtedness other than:

 

(A)           IN THE CASE OF THE BORROWER, (I) SUBJECT TO CLAUSE (II) BELOW,
PERMITTED SUBORDINATED INDEBTEDNESS IN AN AGGREGATE AMOUNT NOT TO EXCEED
$20,000,000 AT ANY TIME OUTSTANDING AND (II) IN AN AGGREGATE AMOUNT IN EXCESS OF
$20,000,000 SOLELY TO THE EXTENT THAT SUCH EXCESS AMOUNTS ARE APPLIED TO PREPAY
THE LOANS PURSUANT TO SECTION 2.05(B)(IV); AND

 

(B)           IN THE CASE OF THE BORROWER AND ITS SUBSIDIARIES,

 

(I)            INDEBTEDNESS UNDER THE LOAN DOCUMENTS;

 

(II)           INDEBTEDNESS OF (A) THE BORROWER OWING TO HOLDINGS OR ANY OF THE
RESTRICTED SUBSIDIARIES, (B) ANY OF THE RESTRICTED SUBSIDIARIES OWING TO
HOLDINGS OR THE BORROWER OR ANY OF THE OTHER RESTRICTED SUBSIDIARIES, (C) ANY OF
THE UNRESTRICTED SUBSIDIARIES OWING TO HOLDINGS OR THE BORROWER OR ANY OF THE
RESTRICTED SUBSIDIARIES TO THE EXTENT THE INVESTMENT IN SUCH UNRESTRICTED
SUBSIDIARY IS OTHERWISE PERMITTED UNDER SECTION 7.05(D) AND (D) ANY OF THE
UNRESTRICTED SUBSIDIARIES OWING TO ANY OF THE OTHER UNRESTRICTED SUBSIDIARIES;
PROVIDED THAT ALL SUCH INTERCOMPANY INDEBTEDNESS OWING BY ANY LOAN PARTY SHALL
BE EVIDENCED BY A PROMISSORY NOTE CONTAINING SUBORDINATION PROVISIONS IN
SUBSTANTIALLY THE FORM OF EXHIBIT L HERETO AND SUCH OTHER TERMS AND CONDITIONS
AS SHALL BE REASONABLY ACCEPTABLE TO THE ADMINISTRATIVE AGENT, WHICH PROMISSORY
NOTE SHALL, IN EACH CASE, TO THE EXTENT OWING TO A LOAN PARTY, BE PLEDGED AS
COLLATERAL TO THE ADMINISTRATIVE AGENT, ON BEHALF OF THE SECURED PARTIES, UNDER
THE APPLICABLE COLLATERAL DOCUMENTS IMMEDIATELY UPON THE CREATION THEREOF;

 

(III)          INDEBTEDNESS SECURED BY LIENS PERMITTED UNDER SECTION 7.01(D) IN
AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $20,000,000 AT ANY TIME OUTSTANDING;

 

(IV)          CONTINGENT OBLIGATIONS OF HOLDINGS, THE BORROWER AND ITS
SUBSIDIARIES OF INDEBTEDNESS OF THE BORROWER OR SUCH SUBSIDIARY; PROVIDED THAT
EACH SUCH OBLIGATION IS NOT OTHERWISE PROHIBITED UNDER THE TERMS OF THE LOAN
DOCUMENTS;

 

(V)           INDEBTEDNESS COMPRISED OF TRADE PAYABLES OR OTHER ACCOUNTS PAYABLE
TO TRADE CREDITORS INCURRED IN THE ORDINARY COURSE OF BUSINESS TO THE EXTENT
OTHERWISE INCLUDED IN THE DEFINITION OF  “INDEBTEDNESS” SET FORTH IN
SECTION 1.01;

 

(VI)          INDEBTEDNESS OF ONE OR MORE FOREIGN SUBSIDIARIES ARISING IN THE
ORDINARY COURSE OF BUSINESS IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED
$15,000,000 AT ANY TIME OUTSTANDING; PROVIDED THAT ALL SUCH INDEBTEDNESS
INCURRED PURSUANT TO THIS SUBCLAUSE (B)(VI) SHALL BE NONRECOURSE IN ALL RESPECTS
TO THE PROPERTY AND ASSETS OF THE LOAN PARTIES AND THEIR SUBSIDIARIES (OTHER
THAN ONE OR MORE OF THE FOREIGN SUBSIDIARIES);

 

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(VII)         INDEBTEDNESS EXISTING AT THE TIME THAT ANY PROPERTY OR ASSET IS
PURCHASED OR OTHERWISE ACQUIRED BY THE BORROWER OR ANY OF ITS SUBSIDIARIES, OR
THAT ANY PERSON (OTHER THAN THE BORROWER OR ANY OF ITS SUBSIDIARIES) IS MERGED
INTO OR CONSOLIDATED WITH ANY OF THE SUBSIDIARIES OF THE BORROWER OR OTHERWISE
BECOMES A SUBSIDIARY OF THE BORROWER, IN ACCORDANCE WITH THE TERMS OF THE LOAN
DOCUMENTS; PROVIDED THAT (X) NO SUCH INDEBTEDNESS SHALL BE INCURRED IN
CONTEMPLATION OF ANY SUCH PURCHASE OR OTHER ACQUISITION OR ANY SUCH MERGER,
CONSOLIDATION OR ACQUISITION, (Y) SUCH INDEBTEDNESS SHALL BE SECURED, IF AT ALL,
SOLELY BY LIENS PERMITTED UNDER SECTION 7.01(E) OR 7.01(F) AND (Z) THE BORROWER
AND ITS SUBSIDIARIES WILL BE IN PRO FORMA COMPLIANCE WITH THE COVENANTS SET
FORTH IN SECTION 6.14, AFTER GIVING EFFECT TO SUCH PERMITTED ACQUISITION AND THE
INCURRENCE OR ISSUANCE OF SUCH INDEBTEDNESS;

 

(VIII)        INDEBTEDNESS NOT OTHERWISE PERMITTED UNDER THIS SECTION 7.02 IN AN
AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $30,000,000 AT ANY TIME OUTSTANDING;

 

(IX)           ENDORSEMENT OF NEGOTIABLE INSTRUMENTS FOR DEPOSIT OR COLLECTION
OR SIMILAR TRANSACTIONS IN THE ORDINARY COURSE OF BUSINESS;

 

(X)            INDEBTEDNESS EXTENDING THE MATURITY OF, OR REFUNDING, REFINANCING
OR REPLACING, IN WHOLE OR IN PART, ANY INDEBTEDNESS INCURRED UNDER ANY OF
SUBCLAUSES (B)(VII), (B)(XIX) AND (C)(II) OF THIS SECTION 7.02; PROVIDED,
HOWEVER, THAT (A) THE AGGREGATE PRINCIPAL AMOUNT OF SUCH EXTENDED, REFUNDING,
REFINANCING OR REPLACEMENT INDEBTEDNESS SHALL NOT BE INCREASED ABOVE THE
PRINCIPAL AMOUNT THEREOF AND THE PREMIUM, IF ANY, PAYABLE THEREON OUTSTANDING
IMMEDIATELY PRIOR TO SUCH EXTENSION, REFUNDING, REFINANCING OR REPLACEMENT,
EXCEPT BY AN AMOUNT EQUAL TO A REASONABLE PREMIUM PAID, AND FEES AND EXPENSES
REASONABLY INCURRED, IN CONNECTION WITH SUCH MODIFICATION, REFINANCING,
REFUNDING, RENEWAL OR EXTENSION AND BY AN AMOUNT EQUAL TO ANY EXISTING
COMMITMENTS UNUTILIZED THEREUNDER OR AS OTHERWISE PERMITTED PURSUANT TO SECTION
7.02, (B) THE DIRECT AND CONTINGENT OBLIGORS THEREFOR SHALL NOT BE CHANGED AS A
RESULT OF OR IN CONNECTION WITH SUCH EXTENSION, REFUNDING, REFINANCING OR
REPLACEMENT, (C) SUCH EXTENDED, REFUNDING, REFINANCING OR REPLACEMENT
INDEBTEDNESS SHALL NOT HAVE A STATED MATURITY DATE OR MANDATORY REDEMPTION DATE
PRIOR TO THE STATED MATURITY DATE OR MANDATORY REDEMPTION DATE OF THE
INDEBTEDNESS BEING SO EXTENDED, REFUNDED, REFINANCED OR REPLACED, (D) IF THE
INDEBTEDNESS BEING SO EXTENDED, REFUNDED, REFINANCED OR REPLACED IS SUBORDINATED
IN RIGHT OF PAYMENT OR OTHERWISE TO THE OBLIGATIONS OF THE BORROWER OR ANY OF
ITS SUBSIDIARIES UNDER AND IN RESPECT OF THE LOAN DOCUMENTS, SUCH EXTENDED,
REFUNDING, REFINANCING OR REPLACEMENT INDEBTEDNESS SHALL BE SUBORDINATED TO SUCH
OBLIGATIONS TO AT LEAST THE SAME EXTENT, (E) THE TERMS OF ANY SUCH EXTENDING,
REFUNDING, REFINANCING OR REPLACEMENT INDEBTEDNESS (AND OF ANY AGREEMENT ENTERED
INTO AND OF ANY INSTRUMENT ISSUED IN CONNECTION THEREWITH) SHALL BE NOT BE
MATERIALLY LESS FAVORABLE TO THE BORROWER AND ITS SUBSIDIARIES OR TO THE RIGHTS
OR INTERESTS OF THE LENDERS THAN THE TERMS OF THE INDEBTEDNESS BEING SO
EXTENDED, REFUNDED, REFINANCED OR REPLACED AND (F) IMMEDIATELY BEFORE AND
IMMEDIATELY AFTER GIVING PRO FORMA EFFECT TO ANY SUCH EXTENSION, REFUNDING,
REFINANCING OR REPLACEMENT, NO DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING;

 

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(XI)           SWAP CONTRACTS ENTERED INTO IN THE ORDINARY COURSE OF BUSINESS OF
THE BORROWER OR SUCH SUBSIDIARY FOR THE PURPOSE OF HEDGING AGAINST FLUCTUATIONS
IN THE INTEREST RATES, FOREIGN EXCHANGE RATES OR COMMODITIES PRICING RISKS;
PROVIDED THAT ALL SUCH SWAP CONTRACTS SHALL BE NONSPECULATIVE IN NATURE
(INCLUDING, WITHOUT LIMITATION, WITH RESPECT TO THE TERM AND PURPOSE THEREOF);

 

(XII)          INDEBTEDNESS OF BORROWER AND ITS SUBSIDIARIES OWED TO THE SELLER
OF ANY PROPERTY ACQUIRED IN A PERMITTED ACQUISITION ON AN UNSECURED SUBORDINATED
BASIS, IN EACH CASE, SO LONG AS BOTH IMMEDIATELY PRIOR AND AFTER GIVING EFFECT
THERETO, (X) NO EVENT OF DEFAULT SHALL EXIST OR RESULT THEREFROM, AND (Y) THE
BORROWER AND ITS SUBSIDIARIES WILL BE IN PRO FORMA COMPLIANCE WITH THE COVENANTS
SET FORTH IN SECTION 6.14, AFTER GIVING EFFECT TO SUCH PERMITTED ACQUISITION AND
THE INCURRENCE OR ISSUANCE OF SUCH INDEBTEDNESS;

 

(XIII)         INDEBTEDNESS (OTHER THAN FOR BORROWED MONEY) SUBJECT TO LIENS
PERMITTED UNDER SECTION 7.01;

 

(XIV)        INDEBTEDNESS REPRESENTING DEFERRED COMPENSATION TO EMPLOYEES OF
HOLDINGS AND ITS SUBSIDIARIES IN THE ORDINARY COURSE OF BUSINESS;

 

(XV)         INDEBTEDNESS CONSISTING OF PROMISSORY NOTES ISSUED BY ANY LOAN
PARTY TO THEIR RESPECTIVE CURRENT OR FORMER OFFICERS, DIRECTORS AND EMPLOYEES,
THEIR RESPECTIVE ESTATES, SPOUSES OR FORMER SPOUSES TO FINANCE THE PURCHASE OR
REDEMPTION OF EQUITY INTERESTS OF HOLDINGS PERMITTED BY SECTION 7.06;

 

(XVI)        INDEBTEDNESS INCURRED BY HOLDINGS OR ITS SUBSIDIARIES IN A
PERMITTED ACQUISITION OR DISPOSITION UNDER AGREEMENTS PROVIDING FOR THE
ADJUSTMENT OF THE PURCHASE PRICE OR SIMILAR ADJUSTMENTS, IN EACH CASE TO THE
EXTENT OF SUCH PURCHASE PRICE OR SIMILAR ADJUSTMENT;

 

(XVII)       INDEBTEDNESS CONSISTING OF OBLIGATIONS OF HOLDINGS OR ITS
SUBSIDIARIES UNDER DEFERRED COMPENSATION OR OTHER SIMILAR ARRANGEMENTS INCURRED
BY SUCH PERSON IN CONNECTION WITH THE NU-GRO TRANSACTION AND PERMITTED
ACQUISITIONS;

 

(XVIII)      INDEBTEDNESS IN RESPECT OF NETTING SERVICES, OVERDRAFT PROTECTIONS
AND SIMILAR ARRANGEMENTS IN EACH CASE IN CONNECTION WITH DEPOSIT ACCOUNTS AND
ENTERED INTO IN THE ORDINARY COURSE OF BUSINESS;

 

(XIX)         INDEBTEDNESS EXISTING AS OF THE CLOSING DATE AND DESCRIBED ON
SCHEDULE 7.02; AND

 

(XX)          INDEBTEDNESS IN RESPECT OF THE CANADIAN LOAN; AND

 

(C)           IN THE CASE OF HOLDINGS:

 

(I)            INDEBTEDNESS UNDER THE LOAN DOCUMENTS;

 

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(II)           UNSECURED INDEBTEDNESS OF HOLDINGS (“PERMITTED HOLDCO DEBT”) THAT
(A) IS NOT SUBJECT TO ANY GUARANTEE BY THE BORROWER OR ANY RESTRICTED
SUBSIDIARY, (B) WILL NOT MATURE PRIOR TO THE DATE THAT IS NINETY-ONE (91) DAYS
AFTER THE SCHEDULED MATURITY DATE OF THE TERM FACILITY, (C) HAS NO SCHEDULED
AMORTIZATION OR PAYMENTS OF PRINCIPAL, (D) DOES NOT PERMIT ANY PAYMENTS IN CASH
OF INTEREST OR OTHER AMOUNTS IN RESPECT OF THE PRINCIPAL THEREOF FOR AT LEAST
FIVE (5) YEARS FROM THE DATE OF THE ISSUANCE OR INCURRENCE THEREOF, (E) HAS
MANDATORY PREPAYMENT, REPURCHASE OR REDEMPTION, COVENANT, DEFAULT AND REMEDY
PROVISIONS CUSTOMARY FOR SENIOR DISCOUNT NOTES OF AN ISSUER THAT IS THE PARENT
OF A BORROWER UNDER SENIOR SECURED CREDIT FACILITIES, AND IN ANY EVENT, WITH
RESPECT TO COVENANT, DEFAULT AND REMEDY PROVISIONS, NO MORE RESTRICTIVE THAN
THOSE SET FORTH IN THE INDENTURE FOR THE SENIOR SUBORDINATED NOTES TAKEN AS A
WHOLE (OTHER THAN PROVISIONS CUSTOMARY FOR SENIOR DISCOUNT NOTES OF A HOLDING
COMPANY), AND (F) CONTAINS PROVISIONS WITH RESPECT TO PAID-IN-KIND INTEREST
WHICH ARE REASONABLY SATISFACTORY TO THE ADMINISTRATIVE AGENT; PROVIDED THAT ANY
SUCH INDEBTEDNESS SHALL CONSTITUTE PERMITTED HOLDCO DEBT ONLY IF (I) BOTH BEFORE
AND AFTER GIVING EFFECT TO THE ISSUANCE OR INCURRENCE THEREOF, NO EVENT OF
DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING, (II) AFTER GIVING PRO FORMA
EFFECT TO THE ISSUANCE OR INCURRENCE THEREOF, THE HOLDINGS TOTAL LEVERAGE RATIO
SHALL BE LESS THAN 5.50:1 AND THE TOTAL LEVERAGE RATIO SHALL BE LESS THAN
3.50:1, AND (III) THE CHIEF FINANCIAL OFFICER OF THE BORROWER SHALL HAVE
DELIVERED AN OFFICER’S CERTIFICATE DEMONSTRATING PRO FORMA COMPLIANCE WITH THE
COVENANTS SET FORTH IN SECTION 6.14 IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY TO THE ADMINISTRATIVE AGENT, IT BEING UNDERSTOOD THAT ANY
CAPITALIZED OR PAID-IN-KIND INTEREST OR ACCRETED PRINCIPAL ON SUCH INDEBTEDNESS
SHALL NOT CONSTITUTE AN ISSUANCE OR INCURRENCE OF INDEBTEDNESS FOR PURPOSES OF
THIS PROVISO;

 

(III)          INDEBTEDNESS PERMITTED PURSUANT TO CLAUSES (B)(II), (IV), (XIV),
(XV), (XVI) AND (XVII) ABOVE; AND

 

(IV)          INDEBTEDNESS OWED TO THE SELLER OF ANY PROPERTY ACQUIRED IN A
PERMITTED ACQUISITION ON AN UNSECURED SUBORDINATED BASIS SO LONG AS, IF
APPLICABLE, HOLDINGS COMPLIES WITH THE PROVISO IN SECTION 7.06(G)(V) (WHETHER OR
NOT ANY RESTRICTED PAYMENT IS MADE TO HOLDINGS).

 

7.03         Mergers, Etc.  Merge into or consolidate with any Person or permit
any Person to merge into or consolidate with it, or permit any of its
Subsidiaries to do so, except that:

 

(A)           ANY OF THE SUBSIDIARIES OF THE BORROWER MAY MERGE INTO OR
CONSOLIDATE WITH THE BORROWER; PROVIDED THAT THE BORROWER IS THE SURVIVING
CORPORATION;

 

(B)           ANY OF THE SUBSIDIARIES OF THE BORROWER MAY MERGE INTO OR
CONSOLIDATE WITH ANY OF THE RESTRICTED SUBSIDIARIES; PROVIDED THAT THE PERSON
FORMED BY SUCH MERGER OR CONSOLIDATION IS A RESTRICTED SUBSIDIARY;

 

(C)           ANY OF THE UNRESTRICTED SUBSIDIARIES MAY MERGE INTO OR CONSOLIDATE
WITH ANY OF THE OTHER UNRESTRICTED SUBSIDIARIES;

 

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(D)           IN CONNECTION WITH ANY INVESTMENT PERMITTED BY SECTION 7.05, ANY
OF THE SUBSIDIARIES OF THE BORROWER MAY MERGE INTO OR CONSOLIDATE WITH ANY OTHER
PERSON OR PERMIT ANY OTHER PERSON TO MERGE INTO OR CONSOLIDATE WITH IT; PROVIDED
THAT (I) IF SUCH SUBSIDIARY OF THE BORROWER IS A RESTRICTED SUBSIDIARY, THE
PERSON FORMED BY SUCH MERGER OR CONSOLIDATION SHALL BE A RESTRICTED SUBSIDIARY,
(II) IF SUCH SUBSIDIARY IS A NON-WHOLLY OWNED DOMESTIC SUBSIDIARY, THE PERSON
FORMED BY SUCH MERGER OR CONSOLIDATION SHALL BE A DOMESTIC SUBSIDIARY AND (III)
IF SUCH SUBSIDIARY IS A FOREIGN SUBSIDIARY, THE PERSON FORMED BY SUCH MERGER OR
CONSOLIDATION SHALL BE A SUBSIDIARY OF THE BORROWER; AND PROVIDED FURTHER THAT
THE PERSON WITH WHICH SUCH SUBSIDIARY IS MERGING OR CONSOLIDATING IS ENGAGED IN
SUBSTANTIALLY THE SAME LINE OF BUSINESS AS ONE OR MORE OF THE BUSINESSES ENGAGED
IN BY THE BORROWER AND ITS SUBSIDIARIES ON THE DATE OF THIS AGREEMENT AND THOSE
REASONABLY RELATED OR ANCILLARY THERETO;

 

(E)           IN CONNECTION WITH ANY DISPOSITION PERMITTED UNDER SECTION
7.04(H), ANY OF THE SUBSIDIARIES OF THE BORROWER MAY MERGE INTO OR CONSOLIDATE
WITH ANY OTHER PERSON OR PERMIT ANY OTHER PERSON TO MERGE INTO OR CONSOLIDATE
WITH IT; AND

 

(F)            THE BORROWER AND ITS SUBSIDIARIES MAY CONSUMMATE THE NU-GRO
TRANSACTION;

 

(G)           THE BORROWER MAY CONSUMMATE THE HOLDING COMPANY EVENT; AND

 

(H)           THE BORROWER MAY ENTER INTO A MERGER FOR THE PURPOSE OF CHANGING
ITS JURISDICTION OF INCORPORATION TO ANOTHER JURISDICTION LOCATED WITHIN THE
UNITED STATES, PROVIDED THAT (I) IF THE BORROWER IS NOT THE CONTINUING OR
SURVIVING PERSON, SUCH PERSON SHALL ASSUME THE OBLIGATIONS AND LIABILITIES OF
THE BORROWER UNDER THE LOAN DOCUMENTS IN A MANNER AND PURSUANT TO DOCUMENTS
REASONABLY ACCEPTABLE TO THE ADMINISTRATIVE AGENT AND (II) THE ADMINISTRATIVE
AGENT SHALL HAVE REASONABLY DETERMINED THAT SUCH MERGER WILL NOT MATERIALLY AND
ADVERSELY AFFECT THE RIGHTS AND REMEDIES OF THE ADMINISTRATIVE AGENT, ANY
SECURED PARTY OR ANY LENDER UNDER ANY OF THE LOAN DOCUMENTS.

 

In all cases under this Section 7.03, immediately before and immediately after
giving pro forma effect to such merger or consolidation, no Default shall have
occurred and be continuing.  In addition, in the case of any merger or
consolidation effected pursuant to clause (d), (e) or (h) of this Section 7.03,
immediately after giving effect to such merger or consolidation, the Borrower
and its Subsidiaries shall be in pro forma compliance with all of the covenants
set forth in Section 6.14, such compliance to be determined on the basis of the
Required Financial Information most recently delivered to the Administrative
Agent and the Lenders as though such merger or consolidation had been
consummated as of the first day of the fiscal period covered thereby.

 

7.04         Dispositions.  Dispose of, or permit any of its Subsidiaries to
Dispose of, any property or assets (including, without limitation, any Equity
Interests of its Subsidiaries), except:

 

(A)           THE BORROWER AND ITS SUBSIDIARIES MAY SELL INVENTORY IN THE
ORDINARY COURSE OF BUSINESS;

 

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(B)           THE BORROWER AND ITS SUBSIDIARIES MAY DISPOSE OF PROPERTY AND
ASSETS IN A TRANSACTION OTHERWISE PERMITTED UNDER SECTION 7.01, SECTION 7.03 (SO
LONG AS IN THE CASE OF CLAUSE (D) THEREOF, SUCH DISPOSITION IS PERMITTED
PURSUANT TO A DIFFERENT SUBCLAUSE OF THIS SECTION 7.04), 7.05 OR 7.06;

 

(C)           (I) THE BORROWER MAY DISPOSE OF ANY OF ITS PROPERTY AND ASSETS TO
ANY OF THE RESTRICTED SUBSIDIARIES, (II) ANY OF THE RESTRICTED SUBSIDIARIES MAY
DISPOSE OF ANY OF ITS PROPERTY AND ASSETS TO THE BORROWER OR ANY OF THE OTHER
RESTRICTED SUBSIDIARIES, (III) ANY OF THE UNRESTRICTED SUBSIDIARIES MAY DISPOSE
OF ANY OF ITS PROPERTY AND ASSETS FOR AN AMOUNT NOT IN EXCESS OF FAIR MARKET
VALUE TO THE BORROWER OR ANY OF ITS RESTRICTED SUBSIDIARIES AND (IV) ANY OF THE
UNRESTRICTED SUBSIDIARIES MAY DISPOSE OF ANY OF ITS PROPERTY AND ASSETS TO ANY
OF THE UNRESTRICTED SUBSIDIARIES;

 

(D)           THE BORROWER AND ITS SUBSIDIARIES MAY DISPOSE OF ANY OBSOLETE,
DAMAGED OR WORN OUT ASSETS THAT ARE NO LONGER USEFUL OR NECESSARY IN THE CONDUCT
OF THEIR BUSINESSES AND OPERATIONS IN THE ORDINARY COURSE OF BUSINESS;

 

(E)           LEASES OR SUBLEASES OR LICENSES OR SUBLICENSES OF REAL PROPERTY
AND EQUIPMENT OF THE BORROWER OR ANY OF ITS SUBSIDIARIES TO ANY PERSON SO LONG
AS EACH SUCH LEASE OR SUBLEASE OR LICENSE OR SUBLICENSE, AS THE CASE MAY BE,
SHALL NOT INTERFERE IN ANY MATERIAL RESPECT WITH THE BUSINESS OR OPERATIONS OF
THE BORROWER OR ANY OF ITS SUBSIDIARIES;

 

(F)            LICENSES OR SUBLICENSES OF IP RIGHTS OF THE BORROWER OR ANY OF
ITS SUBSIDIARIES IN THE ORDINARY COURSE OF BUSINESS;

 

(G)           THE BORROWER AND ITS SUBSIDIARIES MAY DISPOSE OF PROPERTY AND
ASSETS NOT OTHERWISE PERMITTED TO BE DISPOSED OF PURSUANT TO THIS SECTION 7.04
SO LONG AS THE (A) AGGREGATE NET BOOK VALUE OF ALL OF THE PROPERTY AND ASSETS OF
THE BORROWER AND ITS SUBSIDIARIES SO DISPOSED OF PURSUANT TO THIS CLAUSE (G) (X)
IN ANY SINGLE TRANSACTION OR SERIES OF RELATED TRANSACTIONS DOES NOT EXCEED
$10,000,000 AND (Y) IN THE AGGREGATE FOR ALL TRANSACTIONS PURSUANT TO THIS
CLAUSE (G) DOES NOT EXCEED $50,000,000 AND (B) THE GROSS PROCEEDS FROM ANY SUCH
DISPOSITION SHALL BE AT LEAST EQUAL TO THE FAIR MARKET VALUE OF THE PROPERTY AND
ASSETS SO DISPOSED OF, DETERMINED AT THE TIME OF SUCH DISPOSITION;

 

(H)           ANY SUBSIDIARY MAY DISPOSE OF ALL OR SUBSTANTIALLY ALL OF ITS
ASSETS (UPON VOLUNTARY LIQUIDATION OR OTHERWISE) TO THE BORROWER OR TO ANOTHER
SUBSIDIARY; PROVIDED, THAT IF THE TRANSFEROR IN SUCH A TRANSACTION IS A LOAN
PARTY, THEN (I) THE TRANSFEREE MUST EITHER BE A LOAN PARTY OR (II) TO THE EXTENT
CONSTITUTING AN INVESTMENT, SUCH INVESTMENT MUST BE A PERMITTED INVESTMENT IN OR
INDEBTEDNESS OF A SUBSIDIARY WHICH IS NOT A LOAN PARTY IN ACCORDANCE WITH
SECTIONS 7.02 AND 7.05, RESPECTIVELY;

 

(I)            DISPOSITIONS OF PROPERTY TO THE EXTENT THAT (I) SUCH PROPERTY IS
EXCHANGED FOR CREDIT AGAINST THE PURCHASE PRICE OF SIMILAR REPLACEMENT PROPERTY
OR (II) THE PROCEEDS OF SUCH DISPOSITION ARE PROMPTLY APPLIED TO THE PURCHASE
PRICE OF SUCH REPLACEMENT PROPERTY;

 

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(J)            DISPOSITIONS OF ACCOUNTS RECEIVABLE SOLELY IN CONNECTION WITH THE
COLLECTION OR COMPROMISE THEREOF;

 

(K)           TRANSFERS OF PROPERTY SUBJECT TO CASUALTY OR CONDEMNATION EVENTS
UPON RECEIPT OF THE NET CASH PROCEEDS OF SUCH EVENT;

 

(L)            DISPOSITIONS BY THE BORROWER AND ITS SUBSIDIARIES OF PROPERTY
PURSUANT TO SALE-LEASEBACK TRANSACTIONS ARE PERMITTED; PROVIDED, THAT (I) THE
FAIR MARKET VALUE OF ALL PROPERTY SO DISPOSED OF SHALL NOT EXCEED $15,000,000
FROM AND AFTER THE CLOSING DATE AND (II) THE PURCHASE PRICE FOR SUCH PROPERTY
SHALL BE PAID TO THE BORROWER OR SUCH SUBSIDIARY FOR NOT LESS THAN 75% CASH
CONSIDERATION; PROVIDED FURTHER THAT THIS SECTION 7.04 SHALL NOT PROHIBIT ANY
SALE-LEASEBACK TRANSACTION RESULTING FROM THE INCURRENCE OF ANY LEASE IN RESPECT
OF ANY CAPITAL ASSET ENTERED INTO WITHIN 180 DAYS OF THE ACQUISITION OF SUCH
CAPITAL ASSET FOR THE PURPOSE OF PROVIDING PERMANENT FINANCING OF SUCH CAPITAL
ASSET;

 

(M)          THE SALE, TRANSFER OR DISPOSITION OF CASH EQUIVALENTS;

 

(N)           CONSIGNMENTS OR SIMILAR ARRANGEMENTS FOR THE SALE OF ASSETS TO
THIRD PARTIES  IN THE ORDINARY COURSE OF BUSINESS CONSISTENT WITH PAST PRACTICE;

 

(O)           SALES OR OTHER DISPOSITIONS OF ANY MINORITY INTEREST IN A JOINT
VENTURE OR OTHER PERSON;

 

(P)           DISPOSITIONS DESCRIBED ON SCHEDULE 7.04 HERETO;

 

(Q)           DISPOSITIONS IN CONNECTION WITH THE RATIONALIZATION OR INTEGRATION
OF NU-GRO AND ITS SUBSIDIARIES WITH THE BORROWER AND ITS SUBSIDIARIES AFTER
GIVING EFFECT TO THE NU-GRO ACQUISITION IN AN AGGREGATE AMOUNT NOT TO EXCEED
$10,000,000 AND OCCURRING WITHIN THREE YEARS AFTER THE CLOSING DATE;

 

(R)            INTERCOMPANY SALES OF PROPERTY IN THE ORDINARY COURSE OF
BUSINESS, PROVIDED THAT IN THE CASE OF ANY SUCH SALE FROM HOLDINGS, THE BORROWER
OR ANY RESTRICTED SUBSIDIARY TO AN UNRESTRICTED SUBSIDIARY, FOR A PURCHASE PRICE
LESS THAN ITS NET BOOK VALUE, THEN THE DIFFERENCE BETWEEN SUCH PURCHASE PRICE
AND THE NET BOOK VALUE SHALL OTHERWISE BE PERMITTED UNDER SECTION 7.02 OR
SECTION 7.05(D); AND

 

(S)           DISPOSITIONS OF IP RIGHTS FOR CONSIDERATION OTHER THAN CASH, SO
LONG AS SUCH DISPOSITIONS COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT;

 

In connection with any Disposition of Collateral permitted by this Section 7.04
(which for the avoidance of doubt, shall not include a Disposition of all or
substantially all of the Collateral or a release of all or substantially all of
the value of the Guaranty) the Administrative Agent will, at the Borrower’s
expense, execute and deliver such releases of Collateral as may be reasonably
necessary to evidence the release of all Liens on such Collateral under the Loan
Documents.

 

7.05         Investments in Other Persons.  Purchase, acquire, make or hold, or
permit any of its Subsidiaries to purchase, acquire, make or hold, any
Investment in any Person, except:

 

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(A)           INVESTMENTS EXISTING ON THE CLOSING DATE AND DESCRIBED ON SCHEDULE
7.05 HERETO AND ANY MODIFICATION, REPLACEMENT, RENEWAL, OR EXTENSION THEREOF;
PROVIDED THAT THE AMOUNT OF THE ORIGINAL INVESTMENT IS NOT INCREASED EXCEPT BY
THE TERMS OF SUCH INVESTMENT OR AS OTHERWISE PERMITTED BY THIS SECTION 7.05;

 

(B)           INVESTMENTS IN CASH AND CASH EQUIVALENTS;

 

(C)           INVESTMENTS IN RESPECT OF SWAP CONTRACTS PERMITTED BY SECTION
7.02(B)(XI);

 

(D)           INVESTMENTS BY (I) THE BORROWER, HOLDINGS OR ANY RESTRICTED
SUBSIDIARY IN THE BORROWER, HOLDINGS OR ANY RESTRICTED SUBSIDIARY, (II) THE
BORROWER, HOLDINGS OR ANY RESTRICTED SUBSIDIARY IN ANY UNRESTRICTED SUBSIDIARY
IN AN AGGREGATE PRINCIPAL AMOUNT FOR ALL SUCH INVESTMENTS NOT TO EXCEED
$15,000,000 LESS THE AGGREGATE AMOUNT OF ANY INDEBTEDNESS INCURRED PURSUANT TO
CLAUSE (C) OF SECTION 7.02(B)(II), (III) ANY UNRESTRICTED SUBSIDIARY IN HOLDINGS
OR ANY OF ITS SUBSIDIARIES, AND (IV) BY HOLDINGS IN THE PARENT (TO THE EXTENT OF
RESTRICTED PAYMENTS PERMITTED TO BE MADE BY HOLDINGS TO THE PARENT PURSUANT TO
SECTION 7.06(H));

 

(E)           INVESTMENTS BY THE BORROWER AND ITS SUBSIDIARIES IN ACCOUNT
DEBTORS RECEIVED IN CONNECTION WITH THE BANKRUPTCY OR REORGANIZATION, OR IN
SETTLEMENT OF THE DELINQUENT OBLIGATIONS OF FINANCIALLY TROUBLED SUPPLIERS OR
CUSTOMERS, IN THE ORDINARY COURSE OF BUSINESS AND IN ACCORDANCE WITH APPLICABLE
COLLECTION AND CREDIT POLICIES ESTABLISHED BY THE BORROWER OR SUCH SUBSIDIARY,
AS THE CASE MAY BE;

 

(F)            LOANS AND ADVANCES BY HOLDINGS AND ITS SUBSIDIARIES TO THEIR
RESPECTIVE EMPLOYEES, OFFICERS AND DIRECTORS IN AN AGGREGATE AMOUNT NOT TO
EXCEED $2,500,000 AT ANY TIME OUTSTANDING;

 

(G)           THE ACCEPTANCE OF PROMISSORY NOTES, CONTINGENT PAYMENT OBLIGATIONS
AND OTHER NONCASH CONSIDERATION RECEIVED AS PAYMENT OF THE PURCHASE PRICE OF ANY
PROPERTY OR ASSETS DISPOSED OF IN ACCORDANCE WITH SECTION 7.04(H);

 

(H)           THE PURCHASE OR OTHER ACQUISITION OF ALL OF THE EQUITY INTERESTS
IN, OR ALL OR SUBSTANTIALLY ALL OF THE PROPERTY AND ASSETS OF, ANY PERSON OR OF
ASSETS CONSTITUTING A BUSINESS UNIT, LINE OF BUSINESS OF OR DIVISION OF ANY
PERSON THAT, UPON THE CONSUMMATION THEREOF, WILL BE OWNED DIRECTLY BY THE
BORROWER OR ANY OF ITS SUBSIDIARIES (INCLUDING, WITHOUT LIMITATION, AS A RESULT
OF A MERGER OR CONSOLIDATION WITH OR INTO THE BORROWER OR A SUBSIDIARY OF THE
BORROWER, EXCEPT THAT IN THE CASE OF ANY SUCH ACQUISITION BY THE BORROWER OR A
RESTRICTED SUBSIDIARY, THE SURVIVING ENTITY OF ANY SUCH MERGER OR CONSOLIDATION
SHALL BE THE BORROWER OR A RESTRICTED SUBSIDIARY); PROVIDED THAT, WITH RESPECT
TO EACH PURCHASE OR OTHER ACQUISITION MADE PURSUANT TO THIS CLAUSE (H) (EACH, A
“PERMITTED ACQUISITION”):

 

(I)            ANY NEWLY CREATED OR ACQUIRED RESTRICTED SUBSIDIARY SHALL COMPLY
WITH THE REQUIREMENTS OF SECTION 6.11;

 

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(II)           THE LINES OF BUSINESS OF THE PERSON TO BE (OR THE PROPERTY AND
ASSETS OF WHICH ARE TO BE) SO PURCHASED OR OTHERWISE ACQUIRED SHALL BE
SUBSTANTIALLY THE SAME LINES OF BUSINESS AS ONE OR MORE OF THE BUSINESSES
ENGAGED IN BY THE BORROWER AND ITS SUBSIDIARIES ON THE DATE OF THIS AGREEMENT
AND THOSE REASONABLY RELATED OR ANCILLARY THERETO;

 

(III)          THE TOTAL CASH CONSIDERATION PAID BY OR ON BEHALF OF THE BORROWER
AND ITS SUBSIDIARIES FOR ANY SUCH PURCHASE OR OTHER ACQUISITION, WHEN AGGREGATED
WITH THE TOTAL CASH CONSIDERATION PAID BY OR ON BEHALF OF THE BORROWER AND ITS
SUBSIDIARIES FOR ALL OTHER PURCHASES AND OTHER ACQUISITIONS MADE BY THE BORROWER
AND ITS SUBSIDIARIES PURSUANT TO THIS CLAUSE (H), SHALL NOT EXCEED $50,000,000
(IT BEING UNDERSTOOD THAT ALL INDEMNITIES, EARNOUTS AND OTHER SIMILAR CONTINGENT
PURCHASE PRICE PAYMENT OBLIGATIONS TO, AND THE AGGREGATE AMOUNTS PAID OR TO BE
PAID UNDER NONCOMPETE, CONSULTING AND OTHER AFFILIATED AGREEMENTS WITH, THE
SELLERS THEREOF, ALL RESERVES FOR LIABILITIES WITH RESPECT THERETO AND ALL
ASSUMPTIONS OF INDEBTEDNESS IN CONNECTION THEREWITH SHALL IN EACH CASE BE
INCLUDED IN DETERMINING THE AMOUNT OF CASH CONSIDERATION EXPENDED, PROVIDED THAT
TO THE EXTENT THAT ANY OF THE FOREGOING AMOUNTS IS NOT KNOWN OR DETERMINABLE,
SUCH AMOUNT SHALL BE DETERMINED TO BE AN AMOUNT REASONABLY ESTIMATED IN GOOD
FAITH TO BE PAYABLE AT THE TIME OF THE PURCHASE OR ACQUISITION);

 

(IV)          IMMEDIATELY BEFORE AND IMMEDIATELY AFTER GIVING PRO FORMA EFFECT
TO ANY SUCH PURCHASE OR OTHER ACQUISITION, NO DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING; AND

 

(V)           THE BORROWER SHALL HAVE DELIVERED TO THE ADMINISTRATIVE AGENT, ON
BEHALF OF THE LENDERS, AT LEAST FIVE BUSINESS DAYS PRIOR TO THE DATE ON WHICH
ANY SUCH PURCHASE OR OTHER ACQUISITION IS TO BE CONSUMMATED, A CERTIFICATE OF A
SENIOR FINANCIAL OFFICER, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE
ADMINISTRATIVE AGENT, CERTIFYING THAT ALL OF THE REQUIREMENTS SET FORTH IN THIS
CLAUSE (H) HAVE BEEN SATISFIED OR WILL BE SATISFIED ON OR PRIOR TO THE
CONSUMMATION OF SUCH PURCHASE OR OTHER ACQUISITION (AND INCLUDING A SCHEDULE
THAT SETS FORTH IN REASONABLE DETAIL ALL OF THE COMPUTATIONS USED BY THE
BORROWER IN DETERMINING COMPLIANCE WITH SUCH REQUIREMENTS);

 

(I)            INVESTMENTS BY THE BORROWER AND ITS SUBSIDIARIES NOT OTHERWISE
PERMITTED UNDER THIS SECTION 7.05 IN AN AGGREGATE AMOUNT NOT TO EXCEED THE SUM
OF (I) $50,000,000 AND (II) (W) THE PORTION OF THE CUMULATIVE EXCESS CASH FLOW
WHICH IS NOT PREPAID TO THE LENDERS PURSUANT TO SECTION 2.06(B)(I) OR NOT USED
TO MAKE RESTRICTED PAYMENTS PURSUANT TO SECTION 7.06 OR HAS NOT BEEN USED TO
MAKE INVESTMENTS UNDER THIS SECTION 7.05 PLUS (X) THE AGGREGATE AMOUNT OF NET
CASH PROCEEDS OF PERMITTED HOLDCO DEBT, PLUS (Y) THE AGGREGATE AMOUNT OF NET
CASH PROCEEDS OF PERMITTED SUBORDINATED INDEBTEDNESS PERMITTED TO BE RETAINED BY
THE BORROWER PURSUANT TO SECTION 7.02(A)(I) PLUS (Z) THE PROCEEDS RECEIVED BY
THE BORROWER FROM PERMITTED AFFILIATE INVESTMENTS; PROVIDED THAT, WITH RESPECT
TO EACH INVESTMENT MADE PURSUANT TO THIS SUBSECTION 7.05(I):

 

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(A)          such Investment shall be in property and assets which are part of,
or in lines of business substantially the same as one or more of the businesses
engaged in by the Borrower and its Subsidiaries on the date of this Agreement
and those reasonably related or ancillary thereto;

 

(B)           any determination of the amount of such Investment shall include
all cash and noncash consideration (including, without limitation, the Fair
Market Value of all Equity Interests issued or transferred to the sellers
thereof, all indemnities, earnouts and other contingent payment obligations to,
and the aggregate amounts paid or to be paid under noncompete, consulting and
other affiliated agreements with, the sellers thereof, all reserves for
liabilities with respect thereto and all assumptions of Indebtedness in
connection therewith, provided that to the extent that any of the foregoing
amounts are not known or determinable, such amount shall be determined to be an
amount reasonably estimated in good faith to be payable on the date such
Investment is made) paid by or on behalf of the Borrower and its Subsidiaries in
connection with such Investment; and

 

(C)           immediately before and immediately after giving pro forma effect
to any such purchase or other acquisition, no Default shall have occurred and be
continuing;

 

(J)            THE NU-GRO TRANSACTION;

 

(K)           INVESTMENTS IN THE ORDINARY COURSE OF BUSINESS CONSISTING OF (I)
ENDORSEMENTS FOR COLLECTION OR DEPOSIT AND (II) CUSTOMARY TRADE ARRANGEMENTS
WITH CUSTOMERS CONSISTENT WITH PAST PRACTICE;  AND

 

(L)            THE LICENSING, SUBLICENSING OR CONTRIBUTION OF IP RIGHTS PURSUANT
TO JOINT MARKETING ARRANGEMENTS WITH PERSONS OTHER THAN HOLDINGS AND ITS
SUBSIDIARIES;

 

(M)          TO THE EXTENT THE SAME CONSTITUTE INVESTMENTS, CONTINGENT
OBLIGATIONS OF HOLDINGS, THE BORROWER AND THEIR RESPECTIVE SUBSIDIARIES (I)
(OTHER THAN A GUARANTEE OF INDEBTEDNESS) MADE IN THE ORDINARY COURSE OF BUSINESS
THAT, INDIVIDUALLY OR IN THE AGGREGATE, COULD NOT REASONABLY BE EXPECTED TO HAVE
A MATERIAL ADVERSE EFFECT OR (II) PERMITTED BY SECTION 7.02.

 

7.06         Restricted Payments.  Declare or pay any dividends on, or purchase,
redeem, retire, defease or otherwise acquire for value, any of its Equity
Interests, now or hereafter outstanding, return any capital to its stockholders,
partners or members (or the equivalent Persons thereof) as such, make any
distribution of property, assets, Equity Interests, obligations or securities to
its stockholders, partners or members (or the equivalent Persons thereof) as
such (any of the foregoing, a “Restricted Payment”), or permit any of its
Subsidiaries to do any of the foregoing, or permit any of its Subsidiaries to
purchase, redeem, retire, defease or otherwise acquire for value any Equity
Interests in the Borrower (or, after the Holdings Company Event, Holdings), or
to issue or sell any of its Equity Interests in order to acquire such Equity
Interests, or, in the case of any Loan Party, issue or sell any Equity Interests
to any Person

 

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that is not a Loan Party (provided that the Borrower or, after the Holdings
Company Event, Holdings, may issue and sell Equity Interests to the extent not
otherwise prohibited hereunder), except that so long as no Default shall have
occurred and be continuing at the time of any of the transactions described in
clause (f)(iv), (g)(iv), (i) or (j) or would occur as a result thereof:

 

(A)           THE BORROWER MAY CONSUMMATE THE PREFERRED STOCK REDEMPTION;

 

(B)           HOLDINGS AND EACH OF ITS SUBSIDIARIES MAY DECLARE AND MAKE
DIVIDENDS AND OTHER DISTRIBUTIONS ON ITS OUTSTANDING EQUITY INTERESTS PAYABLE IN
SUCH EQUITY INTERESTS (OTHER THAN REDEEMABLE EQUITY INTERESTS);

 

(C)           ANY OF THE SUBSIDIARIES OF THE BORROWER MAY DECLARE AND PAY OR
MAKE DIVIDENDS AND OTHER DISTRIBUTIONS IN CASH OR IN ADDITIONAL EQUITY INTERESTS
THEREIN TO THE BORROWER OR ANY OF ITS SUBSIDIARIES; PROVIDED THAT SUCH
ADDITIONAL EQUITY INTERESTS ISSUED TO A LOAN PARTY SHALL, TO THE EXTENT REQUIRED
UNDER THE TERMS OF THE APPLICABLE COLLATERAL DOCUMENTS, BE PLEDGED AS COLLATERAL
THEREUNDER TO THE ADMINISTRATIVE AGENT, ON BEHALF OF THE SECURED PARTIES,
IMMEDIATELY UPON THE ISSUANCE THEREOF;

 

(D)           ANY OF THE NON-WHOLLY OWNED SUBSIDIARIES OF THE BORROWER MAY
DECLARE AND PAY OR MAKE DIVIDENDS AND OTHER DISTRIBUTIONS TO ITS SHAREHOLDERS,
PARTNERS OR MEMBERS (OR THE EQUIVALENT PERSONS THEREOF) GENERALLY SO LONG AS THE
BORROWER AND EACH OF THE RESTRICTED SUBSIDIARIES THAT OWN ANY OF THE EQUITY
INTERESTS THEREIN RECEIVE AT LEAST THEIR RESPECTIVE PROPORTIONATE SHARES OF ANY
SUCH DIVIDEND OR DISTRIBUTION (BASED UPON THEIR RELATIVE HOLDINGS OF THE EQUITY
INTERESTS THEREIN AND TAKING INTO ACCOUNT THE RELATIVE PREFERENCES, IF ANY, OF
THE VARIOUS CLASSES OF THE EQUITY INTERESTS THEREIN);

 

(E)           TO THE EXTENT CONSTITUTING RESTRICTED PAYMENTS, THE BORROWER AND
ITS SUBSIDIARIES MAY ENTER INTO TRANSACTIONS PERMITTED BY SECTION 6.10 OR 7.03;

 

(F)            ANY SUBSIDIARY OF HOLDINGS MAY MAKE RESTRICTED PAYMENTS TO
HOLDINGS:

 

(I)            THE PROCEEDS OF WHICH WILL BE USED TO PAY THE TAX LIABILITY FOR
THE RELEVANT JURISDICTION IN RESPECT OF CONSOLIDATED, COMBINED, UNITARY OR
AFFILIATED RETURNS FOR THE RELEVANT JURISDICTION OF HOLDINGS ATTRIBUTABLE TO THE
BORROWER AND ITS SUBSIDIARIES DETERMINED AS IF THE BORROWER AND ITS SUBSIDIARIES
FILED SEPARATE RETURNS;

 

(II)           THE PROCEEDS OF WHICH SHALL BE USED BY HOLDINGS TO PAY ITS
OPERATING EXPENSES INCURRED IN THE ORDINARY COURSE OF BUSINESS AND OTHER
CORPORATE OVERHEAD COSTS AND EXPENSES (INCLUDING, WITHOUT LIMITATION,
ADMINISTRATIVE, LEGAL, ACCOUNTING AND SIMILAR EXPENSES PROVIDED BY THIRD
PARTIES), WHICH ARE REASONABLE AND CUSTOMARY AND INCURRED IN THE ORDINARY COURSE
OF BUSINESS, IN AN AGGREGATE AMOUNT NOT TO EXCEED $500,000 IN ANY FISCAL YEAR
PLUS ANY REASONABLE AND CUSTOMARY INDEMNIFICATION CLAIMS MADE BY DIRECTORS OR
OFFICERS OF HOLDINGS ATTRIBUTABLE TO THE OWNERSHIP OR OPERATIONS OF THE BORROWER
AND ITS SUBSIDIARIES;

 

(III)          THE PROCEEDS OF WHICH SHALL BE USED BY HOLDINGS TO PAY ITS
FRANCHISE TAXES;

 

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(IV)          THE PROCEEDS OF WHICH WILL BE USED TO REPURCHASE THE EQUITY
INTERESTS OF HOLDINGS FROM CURRENT OR FORMER DIRECTORS, EMPLOYEES OR MEMBERS OF
MANAGEMENT OF HOLDINGS OR ANY OF ITS SUBSIDIARIES (OR THEIR ESTATE, FAMILY
MEMBERS, SPOUSE AND/OR FORMER SPOUSE), IN AN AGGREGATE AMOUNT NOT IN EXCESS OF
$2,500,000 IN ANY FISCAL YEAR PLUS THE PROCEEDS OF ANY KEY-MAN LIFE INSURANCE
MAINTAINED BY HOLDINGS OR ANY OF ITS SUBSIDIARIES; PROVIDED, THAT HOLDINGS MAY
CARRY-OVER AND MAKE IN ANY SUBSEQUENT CALENDAR YEAR OR YEARS, IN ADDITION TO THE
AMOUNT FOR SUCH CALENDAR YEAR, THE AMOUNT NOT UTILIZED IN THE PRIOR CALENDAR
YEAR OR YEARS UP TO A MAXIMUM OF $2,500,000; AND

 

(V)           TO FINANCE ANY INVESTMENT PERMITTED TO BE MADE PURSUANT TO SECTION
7.05; PROVIDED, THAT (A) SUCH RESTRICTED PAYMENT SHALL BE MADE CONCURRENTLY WITH
THE CLOSING OF SUCH INVESTMENT AND (B) HOLDINGS SHALL, IMMEDIATELY FOLLOWING THE
CLOSING THEREOF, CAUSE (1) ALL PROPERTY ACQUIRED (WHETHER ASSETS OR EQUITY
INTERESTS) TO BE CONTRIBUTED TO THE BORROWER OR ITS SUBSIDIARIES OR (2) THE
MERGER (TO THE EXTENT PERMITTED IN SECTION 7.04) OF THE PERSON FORMED OR
ACQUIRED INTO THE BORROWER OR ITS SUBSIDIARIES IN ORDER TO CONSUMMATE SUCH
PERMITTED ACQUISITION;

 

(G)           ANY SUBSIDIARY OF PARENT MAY MAKE RESTRICTED PAYMENTS TO PARENT:

 

(I)            THE PROCEEDS OF WHICH WILL BE USED TO PAY THE TAX LIABILITY FOR
THE RELEVANT JURISDICTION IN RESPECT OF CONSOLIDATED, COMBINED, UNITARY OR
AFFILIATED RETURNS FOR THE RELEVANT JURISDICTION OF PARENT ATTRIBUTABLE TO
HOLDINGS AND ITS SUBSIDIARIES DETERMINED AS IF HOLDINGS AND ITS SUBSIDIARIES
FILED SEPARATE RETURNS;

 

(II)           THE PROCEEDS OF WHICH SHALL BE USED BY PARENT TO PAY ITS
OPERATING EXPENSES INCURRED IN THE ORDINARY COURSE OF BUSINESS AND OTHER
CORPORATE OVERHEAD COSTS AND EXPENSES (INCLUDING, WITHOUT LIMITATION,
ADMINISTRATIVE, LEGAL, ACCOUNTING AND SIMILAR EXPENSES PROVIDED BY THIRD
PARTIES), WHICH ARE REASONABLE AND CUSTOMARY AND INCURRED IN THE ORDINARY COURSE
OF BUSINESS, IN AN AGGREGATE AMOUNT NOT TO EXCEED $500,000 IN ANY FISCAL YEAR
PLUS ANY REASONABLE AND CUSTOMARY INDEMNIFICATION CLAIMS MADE BY DIRECTORS OR
OFFICERS OF PARENT ATTRIBUTABLE TO THE OWNERSHIP OR OPERATIONS OF HOLDINGS AND
ITS SUBSIDIARIES;

 

(III)          THE PROCEEDS OF WHICH SHALL BE USED BY PARENT TO PAY ITS
FRANCHISE TAXES;

 

(IV)          THE PROCEEDS OF WHICH WILL BE USED TO REPURCHASE THE EQUITY
INTERESTS OF PARENT FROM CURRENT OR FORMER DIRECTORS, EMPLOYEES OR MEMBERS OF
MANAGEMENT OF PARENT OR ANY SUBSIDIARY (OR THEIR ESTATE, FAMILY MEMBERS, SPOUSE
AND/OR FORMER SPOUSE), IN AN AGGREGATE AMOUNT NOT IN EXCESS OF $2,500,000 IN ANY
FISCAL YEAR PLUS THE PROCEEDS OF ANY KEY-MAN LIFE INSURANCE MAINTAINED BY PARENT
OR ANY OF ITS SUBSIDIARIES; PROVIDED, THAT PARENT MAY CARRY-OVER AND MAKE IN ANY
SUBSEQUENT CALENDAR YEAR OR YEARS, IN ADDITION TO THE AMOUNT FOR SUCH CALENDAR
YEAR, THE AMOUNT NOT UTILIZED IN THE PRIOR CALENDAR YEAR OR YEARS UP TO A
MAXIMUM OF $2,500,000; AND

 

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(V)           TO FINANCE ANY INVESTMENT PERMITTED TO BE MADE PURSUANT TO SECTION
7.05; PROVIDED, THAT (A) SUCH RESTRICTED PAYMENT SHALL BE MADE CONCURRENTLY WITH
THE CLOSING OF SUCH INVESTMENT AND (B) PARENT SHALL, IMMEDIATELY FOLLOWING THE
CLOSING THEREOF, CAUSE (1) ALL PROPERTY ACQUIRED (WHETHER ASSETS OR EQUITY
INTERESTS) TO BE CONTRIBUTED TO HOLDINGS OR ITS SUBSIDIARIES OR (2) THE MERGER
(TO THE EXTENT PERMITTED IN SECTION 7.03) OF THE PERSON FORMED OR ACQUIRED INTO
HOLDINGS OR ITS SUBSIDIARIES IN ORDER TO CONSUMMATE SUCH PERMITTED ACQUISITION;

 

(H)           REPURCHASES OF EQUITY INTERESTS OF HOLDINGS DEEMED TO OCCUR UPON
THE NON-CASH EXERCISE OF STOCK OPTIONS AND WARRANTS;

 

(I)            HOLDINGS MAY MAKE RESTRICTED PAYMENTS WITH THE PROCEEDS OF
PERMITTED HOLDCO DEBT AND PERMITTED AFFILIATE INVESTMENTS; AND

 

(J)            IN ADDITION TO THE FOREGOING RESTRICTED PAYMENTS, THE BORROWER
MAY MAKE ADDITIONAL RESTRICTED PAYMENTS TO HOLDINGS THE PROCEEDS OF WHICH MAY BE
UTILIZED BY HOLDINGS TO MAKE ADDITIONAL RESTRICTED PAYMENTS, IN AN AGGREGATE
AMOUNT NOT TO EXCEED THE SUM OF (A) $1,000,000 (SUCH AMOUNT TO BE INCREASED TO
(X) $20,000,000 IF THE TOTAL LEVERAGE RATIO IS, ON A PRO FORMA BASIS AFTER
GIVING EFFECT TO SUCH RESTRICTED PAYMENT, LESS THAN 4.00:1.00 AND (Y)
$35,000,000 IF THE TOTAL LEVERAGE RATIO IS LESS THAN 3.50:1.00) PLUS (B) WITHOUT
DUPLICATION, THE LESSER OF (1) 25% OF THE AGGREGATE AMOUNT OF THE CUMULATIVE
EXCESS CASH FLOW AND (2) THE PORTION OF THE CUMULATIVE EXCESS CASH FLOW WHICH IS
NOT PREPAID TO THE LENDERS PURSUANT TO SECTION 2.06(B)(I) OR NOT USED TO MAKE
INVESTMENTS PURSUANT TO SECTION 7.05 OR HAS NOT BEEN USED TO MAKE RESTRICTED
PAYMENTS UNDER THIS SECTION 7.06.

 

7.07         Capital Expenditures.  Make, or permit any of its Subsidiaries to
make, any Capital Expenditures that would cause the aggregate amount of all such
Capital Expenditures made by the Borrower and its Subsidiaries during any Fiscal
Year to exceed the amount specified in the table below for such Fiscal Year;
provided, however, that if, at the end of any Fiscal Year, the aggregate amount
of all Capital Expenditures made by the Borrower and its Subsidiaries during
such Fiscal Year is less than the amount specified in the table below for such
Fiscal Year (the amount of such difference being the “Carryover Capital
Expenditure Amount”), then, notwithstanding the foregoing provision of this
Section 7.07, the Borrower and its Subsidiaries shall be permitted to make
additional Capital Expenditures during the next succeeding Fiscal Year in an
amount not to exceed the Carryover Capital Expenditure Amount, if any, from such
Fiscal Year; provided further, however, that any Carryover Capital Expenditure
Amount carried forward to the next succeeding Fiscal Year shall not be deemed to
have been utilized to make Capital Expenditures until after the utilization of
the amount set forth above in this Section 7.07 for Capital Expenditures
permitted to be made in such Fiscal Year, and may not be carried forward to any
subsequent Fiscal Year.

 

Fiscal Year

 

Amount

 

2004

 

$

30,000,000

 

2005

 

$

30,000,000

 

2006

 

$

35,000,000

 

2007

 

$

35,000,000

 

2008 (and each Fiscal Year thereafter)

 

$

40,000,000

 

 

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7.08         Prepayments, Etc. of Indebtedness.  (a) Prepay, redeem, purchase,
defease or otherwise satisfy prior to the scheduled maturity thereof in any
manner any of the Senior Subordinated Notes, any Permitted Subordinated
Indebtedness and any Permitted Holdco Debt (collectively, “Junior Financing”) or
make any payment in violation of any subordination terms contained in any Junior
Financing, except (i) the refinancing thereof with the Net Cash Proceeds of any
further incurrence of Permitted Subordinated Indebtedness, Permitted Holdco Debt
or Permitted Equity Issuance, in each case, to the extent not required to prepay
any Loans or Facility pursuant to Section 2.05(b) and (ii) the conversion of any
Junior Financing to Equity Interests (other than Redeemable Equity Interests),
(b) amend, modify or change in any manner any term or condition of any
documentation related to any Junior Financing, except as could not materially
and adversely affect the rights or interests of the Administrative Agent or the
Lenders  or (c) permit any of its Subsidiaries to do any of the foregoing.

 

7.09         Negative Pledge.  Enter into or suffer to exist, or permit any of
its Subsidiaries to enter into or suffer to exist, any agreement prohibiting or
conditioning the creation or assumption of any Lien upon any of its property or
assets other than:

 

(A)           ANY SUCH AGREEMENT WITH OR IN FAVOR OF THE SECURED PARTIES OR THE
ADMINISTRATIVE AGENT, ON BEHALF OF THE SECURED PARTIES;

 

(B)           ANY SUCH AGREEMENT WITH OR IN FAVOR OF THE HOLDERS OF THE SENIOR
SUBORDINATED NOTES OR THE TRUSTEE FOR THE SENIOR SUBORDINATED NOTES, ON BEHALF
OF THE HOLDERS THEREOF, IN EACH CASE AS SUCH AGREEMENT WAS IN EFFECT ON THE
CLOSING DATE (OR AS AMENDED IN COMPLIANCE WITH SECTION 7.08(B));

 

(C)           IN CONNECTION WITH (I) ANY INDEBTEDNESS DESCRIBED ON SCHEDULE
7.02, (II) ANY INDEBTEDNESS OTHERWISE PERMITTED TO BE INCURRED UNDER SECTION
7.02(B)(X) AND (III) ANY INDEBTEDNESS OUTSTANDING ON THE DATE ANY PERSON FIRST
BECOMES A SUBSIDIARY OF THE BORROWER; PROVIDED THAT SUCH AGREEMENT WAS NOT
CREATED IN CONTEMPLATION OF THE PURCHASE OR OTHER ACQUISITION OF SUCH PERSON AND
DOES NOT EXTEND TO OR COVER ANY PROPERTY OR ASSETS OTHER THAN PROPERTY AND
ASSETS OF THE PERSON BECOMING SUCH SUBSIDIARY (OR PROCEEDS OR PRODUCTS THEREOF);

 

(D)           ANY SUCH AGREEMENT PROHIBITING OTHER ENCUMBRANCES ON SPECIFIC
PROPERTY AND ASSETS OF THE BORROWER OR ANY OF ITS SUBSIDIARIES, WHICH AGREEMENT
SECURES THE PAYMENT OF INDEBTEDNESS INCURRED SOLELY TO ACQUIRE, CONSTRUCT OR
IMPROVE SUCH PROPERTY OR ASSETS OR TO FINANCE THE PURCHASE PRICE THEREFOR
(INCLUDING, WITHOUT LIMITATION, CAPITALIZED LEASES) AND WHICH INDEBTEDNESS IS
OTHERWISE PERMITTED TO BE INCURRED UNDER THE TERMS OF THIS AGREEMENT;

 

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(E)           ANY SUCH AGREEMENT WITH OR IN FAVOR OF THE HOLDERS OF THE
INDEBTEDNESS OF ONE OR MORE OF THE FOREIGN SUBSIDIARIES (OR ANY AGENT FOR THE
HOLDERS OF SUCH INDEBTEDNESS) INCURRED PURSUANT TO SECTION 7.02(B)(VI);

 

(F)            ANY AGREEMENT SETTING FORTH CUSTOMARY RESTRICTIONS ON THE
SUBLETTING, ASSIGNMENT OR TRANSFER OF ANY PROPERTY OR ASSET THAT IS A LEASE,
LICENSE, CONVEYANCE OR CONTRACT OF SIMILAR PROPERTY OR ASSETS; AND

 

(G)           ANY RESTRICTION OR ENCUMBRANCE IMPOSED PURSUANT TO AN AGREEMENT
THAT HAS BEEN ENTERED INTO BY THE BORROWER OR ANY OF ITS SUBSIDIARIES FOR THE
DISPOSITION OF ANY OF ITS PROPERTY OR ASSETS SO LONG AS SUCH DISPOSITION IS
OTHERWISE PERMITTED TO BE MADE UNDER SECTION 7.04.

 

7.10         Dividends and Other Payment Restrictions Affecting Subsidiaries.  
Enter into, create, assume or otherwise suffer to exist or become effective, or
permit any of its Subsidiaries to enter into, create, assume or otherwise suffer
to exist or become effective, directly or indirectly, any consensual encumbrance
or restriction of any kind on the ability of any of its Subsidiaries (a) to pay
dividends or to make any other distributions on any of the Equity Interests in
such Subsidiary owned or otherwise held by the Borrower or any of its
Subsidiaries, (b) to repay or prepay or to subordinate any Indebtedness owed to
the Borrower or any of its Subsidiaries, (c) to make loans or advances to the
Borrower or any of its Subsidiaries, (d) to transfer any of its property or
assets to the Borrower or any of its Subsidiaries or (e) to otherwise make
Investments in the Borrower or any of its Subsidiaries (whether through a
covenant restricting dividends, loans, asset transfers or investments, a
financial covenant or otherwise); provided, however, that nothing in any of
clauses (a) through (e) of this Section 7.10 shall prohibit any such encumbrance
or restriction contained in:

 

(A)           THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS;

 

(B)           ANY AGREEMENTS IN EFFECT ON THE CLOSING DATE;

 

(C)           IN THE CASE OF CLAUSE (D) OF THIS SECTION 7.10, ANY AGREEMENT
SETTING FORTH CUSTOMARY RESTRICTIONS ON THE SUBLETTING, ASSIGNMENT OR TRANSFER
OF ANY PROPERTY OR ASSET THAT IS A LEASE, LICENSE, CONVEYANCE OR CONTRACT OF
SIMILAR PROPERTY OR ASSETS;

 

(D)           IN THE CASE OF CLAUSE (D) OF THIS SECTION 7.10, ANY AGREEMENT WITH
THE HOLDER OF A LIEN OTHERWISE PERMITTED TO EXIST UNDER SECTION 7.01(D)
RESTRICTING ON CUSTOMARY TERMS THE TRANSFER OF ANY PROPERTY OR ASSETS SUBJECT
THERETO;

 

(E)           ANY SUCH AGREEMENT WITH OR IN FAVOR OF THE HOLDERS OF THE
INDEBTEDNESS OF ONE OR MORE OF THE FOREIGN SUBSIDIARIES (OR ANY AGENT FOR THE
HOLDERS OF SUCH INDEBTEDNESS) INCURRED PURSUANT TO SECTION 7.02(B)(VI); PROVIDED
THAT ANY SUCH RESTRICTIONS SET FORTH THEREIN SHALL NOT APPLY TO ANY OF THE LOAN
PARTIES OR ANY OF THEIR SUBSIDIARIES (OTHER THAN ONE OR MORE OF THE FOREIGN
SUBSIDIARIES);

 

(F)            ANY AGREEMENT EVIDENCING INDEBTEDNESS OUTSTANDING ON THE DATE A
PERSON FIRST BECOMES A SUBSIDIARY OF THE BORROWER; PROVIDED THAT SUCH AGREEMENT
WAS NOT CREATED IN CONTEMPLATION OF THE PURCHASE OR OTHER ACQUISITION OF SUCH
PERSON BY THE

 

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BORROWER OR ANY OF ITS SUBSIDIARIES AND DOES NOT EXTEND TO OR COVER ANY PROPERTY
OR ASSETS OTHER THAN THE PROPERTY OR ASSETS OF THE PERSON BECOMING SUCH
SUBSIDIARY (AND PROCEEDS AND PRODUCTS THEREOF);

 

(G)           ANY AGREEMENT EVIDENCING OR SETTING FORTH THE TERMS OF ANY
REFUNDING, REFINANCING OR REPLACEMENT INDEBTEDNESS OTHERWISE PERMITTED TO BE
INCURRED UNDER SECTION 7.02(B)(X); AND

 

(H)           ANY AGREEMENT THAT HAS BEEN ENTERED INTO BY THE BORROWER OR ANY OF
ITS SUBSIDIARIES FOR THE DISPOSITION OF ANY OF ITS PROPERTY OR ASSETS SO LONG AS
SUCH DISPOSITION IS OTHERWISE PERMITTED TO BE MADE UNDER SECTION 7.04.

 

7.11         Change in Nature of Business.  Make, or permit any of its
Subsidiaries to make, any change in the nature of its business that would cause
the Borrower or such Subsidiary to no longer be primarily engaged in one or more
of the businesses engaged in by the Borrower and its Subsidiaries on the date of
this Agreement and those reasonably related or ancillary thereto.

 

7.12         Amendments to Constitutive Documents.  Amend, or permit any of its
Subsidiaries to amend, its Constitutive Documents, except where such amendment,
either individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect or to materially and adversely affect the rights
or interests of the Lenders.

 

7.13         Accounting Changes, Etc.  Make or permit, or permit any of its
Subsidiaries to make or permit, any change in (a) its accounting policies or
reporting practices, except as required by GAAP in effect at the time of such
change or by applicable Requirements of Law, or (b) its Fiscal Year (other than
the change of the Fiscal Year of Nu-Gro and its Subsidiaries to that of the
Borrower in connection with the Nu-Gro Acquisition.

 

7.14         Amendments, Etc. of Nu-Gro Documents.  Cancel or terminate any
Nu-Gro Document or consent to or accept any cancellation or termination thereof,
amend, modify or change in any manner any term or condition of any Nu-Gro
Document or give any consent, waiver or approval thereunder, waive any default
under or any breach of any term or condition of any Nu-Gro Document, agree in
any manner to any other amendment, modification or change of any term or
condition of any Nu-Gro Document, or take any other action in connection with
any Nu-Gro Document that, in each of the foregoing cases under this Section
7.14, either individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect, or permit any of its Subsidiaries to do any of
the foregoing.

 

7.15         Holdings.  (a)  In the case of Holdings, (i) conduct, transact or
otherwise engage in any business or operations other than those incidental to
its ownership of the Equity Interests of the Borrower, the performance of the
Loan Documents and any transactions that Holdings is permitted to enter into or
consummate under this Article VII or (ii) incur any Indebtedness other than
Indebtedness permitted pursuant to Section 7.02(c); or

 

(b)           From and after the occurrence of the Holding Company Event, permit
the Borrower to be a Subsidiary that is not wholly owned by Holdings.

 

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ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES

 

8.01         Events of Default.  If any of the following events (“Events of
Default”) shall occur and be continuing:

 

(A)           (I)  THE BORROWER SHALL FAIL TO PAY ANY PRINCIPAL OF ANY LOAN WHEN
THE SAME SHALL BECOME DUE AND PAYABLE, WHETHER BY SCHEDULED MATURITY OR AT A
DATE FIXED FOR PREPAYMENT OR BY ACCELERATION, DEMAND OR OTHERWISE, OR (II) THE
BORROWER SHALL FAIL TO PAY ANY INTEREST ON ANY LOANS, OR ANY OF THE LOAN PARTIES
SHALL FAIL TO MAKE ANY OTHER PAYMENT UNDER OR IN RESPECT OF ANY OF THE LOAN
DOCUMENTS REQUIRED TO HAVE BEEN MADE BY IT, IN EACH CASE WHETHER BY SCHEDULED
MATURITY OR AT A DATE FIXED FOR PREPAYMENT OR BY ACCELERATION, DEMAND OR
OTHERWISE AND, IN EACH CASE UNDER THIS CLAUSE (II), SUCH FAILURE REMAINS
UNREMEDIED FOR AT LEAST THREE BUSINESS DAYS AFTER THE SAME BECOMES DUE AND
PAYABLE; OR

 

(B)           ANY REPRESENTATION OR WARRANTY MADE BY ANY OF THE LOAN PARTIES (OR
ANY OF THEIR RESPECTIVE OFFICERS) UNDER OR IN CONNECTION WITH ANY OF THE LOAN
DOCUMENTS (INCLUDING, WITHOUT LIMITATION, IN ANY CERTIFICATE, REPORT, STATEMENT
OR OTHER WRITING AT ANY TIME FURNISHED (OR DEEMED TO HAVE BEEN FURNISHED) TO THE
ADMINISTRATIVE AGENT OR ANY OF THE LENDERS BY OR ON BEHALF OF ANY OF THE LOAN
PARTIES) SHALL PROVE TO HAVE BEEN INCORRECT IN ANY MATERIAL RESPECT ON THE DATE
AS OF WHICH IT WAS MADE OR DEEMED MADE; OR

 

(C)           (I)  THE BORROWER SHALL FAIL TO PERFORM OR OBSERVE ANY TERM,
COVENANT OR AGREEMENT CONTAINED IN SECTION 2.15, 6.05 (SOLELY WITH RESPECT TO
HOLDINGS OR THE BORROWER) OR 6.10, ANY OF SUBCLAUSES (I) THROUGH (IV) OF SECTION
6.11(A) OR SECTION 6.13(A), 6.14 OR ARTICLE VII ON ITS PART TO BE PERFORMED OR
OBSERVED; PROVIDED THAT ANY EVENT OF DEFAULT UNDER SECTION 6.14 IS SUBJECT TO
CURE AS CONTEMPLATED BY THE PENULTIMATE PROVISO SET FORTH IN THE DEFINITION OF
“CONSOLIDATED EBITDA”; OR

 

(D)           ANY OF THE LOAN PARTIES SHALL FAIL TO PERFORM OR OBSERVE ANY TERM,
COVENANT OR AGREEMENT CONTAINED IN ANY OF THE LOAN DOCUMENTS ON ITS PART TO BE
PERFORMED OR OBSERVED THAT IS NOT OTHERWISE REFERRED TO IN SECTION 8.01(A) OR
(C) IF SUCH FAILURE SHALL REMAIN UNREMEDIED FOR AT LEAST 30 CONSECUTIVE DAYS
AFTER THE DATE ON WHICH WRITTEN NOTICE THEREOF SHALL HAVE BEEN GIVEN TO THE
BORROWER BY THE ADMINISTRATIVE AGENT; OR

 

(E)           (I) ANY OF THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES SHALL
FAIL TO PAY ANY PRINCIPAL OF, PREMIUM OR INTEREST ON, OR ANY OTHER AMOUNT
PAYABLE IN RESPECT OF, ONE OR MORE ITEMS OF INDEBTEDNESS OF THE LOAN PARTIES AND
THEIR SUBSIDIARIES (EXCLUDING INDEBTEDNESS OUTSTANDING HEREUNDER) THAT IS
OUTSTANDING IN AN AGGREGATE PRINCIPAL AMOUNT (OR, IN THE CASE OF ANY SWAP
CONTRACT, HAVING AN AGREEMENT VALUE) OF AT LEAST $10,000,000 AT THE TIME OF SUCH
FAILURE, WHEN THE SAME BECOMES DUE AND PAYABLE (WHETHER BY SCHEDULED MATURITY,
REQUIRED PREPAYMENT, ACCELERATION, DEMAND OR OTHERWISE), AND SUCH FAILURE SHALL
CONTINUE AFTER THE APPLICABLE GRACE PERIOD, IF ANY, SPECIFIED IN THE AGREEMENTS
OR INSTRUMENTS RELATING TO ALL SUCH INDEBTEDNESS; OR (II) ANY OTHER EVENT SHALL
OCCUR OR CONDITION SHALL EXIST UNDER THE AGREEMENTS OR INSTRUMENTS RELATING TO
ONE OR MORE ITEMS OF INDEBTEDNESS OF ANY OF THE LOAN PARTIES OR ANY OF THEIR

 

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SUBSIDIARIES (EXCLUDING INDEBTEDNESS OUTSTANDING HEREUNDER) THAT IS OUTSTANDING
IN AN AGGREGATE PRINCIPAL AMOUNT (OR, IN THE CASE OF ANY SWAP CONTRACT, HAVING
AN AGREEMENT VALUE) OF AT LEAST $10,000,000 AT THE TIME OF SUCH OTHER EVENT OR
CONDITION, AND SHALL CONTINUE AFTER THE APPLICABLE GRACE PERIOD, IF ANY,
SPECIFIED IN ALL SUCH AGREEMENTS OR INSTRUMENTS, IF THE EFFECT OF SUCH EVENT OR
CONDITION IS TO ACCELERATE, OR TO PERMIT THE ACCELERATION OF, THE MATURITY OF
SUCH INDEBTEDNESS OR OTHERWISE TO CAUSE, OR TO PERMIT THE HOLDER THEREOF TO
CAUSE, SUCH INDEBTEDNESS TO MATURE PRIOR TO ITS STATED MATURITY; OR (III) ONE OR
MORE ITEMS OF INDEBTEDNESS OF ANY OF THE LOAN PARTIES OR ANY OF THEIR
SUBSIDIARIES (EXCLUDING INDEBTEDNESS OUTSTANDING HEREUNDER) THAT IS OUTSTANDING
(OR UNDER WHICH ONE OR MORE PERSONS HAVE A COMMITMENT TO EXTEND CREDIT) IN AN
AGGREGATE PRINCIPAL AMOUNT (OR, IN THE CASE OF ANY SWAP CONTRACT, HAVING AN
AGREEMENT VALUE) OF AT LEAST $10,000,000 SHALL BE DECLARED TO BE DUE AND PAYABLE
OR REQUIRED TO BE PREPAID OR REDEEMED (OTHER THAN BY A REGULARLY SCHEDULED OR
REQUIRED PREPAYMENT OR REDEMPTION), PURCHASED OR DEFEASED, OR AN OFFER TO
PREPAY, REDEEM, PURCHASE OR DEFEASE SUCH INDEBTEDNESS SHALL BE REQUIRED TO BE
MADE, IN EACH CASE, PRIOR TO THE STATED MATURITY THEREOF; OR

 

(F)            ANY OF THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES SHALL ADMIT
IN WRITING ITS INABILITY TO PAY ITS DEBTS GENERALLY, OR SHALL MAKE A GENERAL
ASSIGNMENT FOR THE BENEFIT OF CREDITORS; OR ANY PROCEEDING SHALL BE INSTITUTED
BY OR AGAINST ANY OF THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES SEEKING TO
ADJUDICATE IT A BANKRUPT OR INSOLVENT, OR SEEKING LIQUIDATION, WINDING UP,
REORGANIZATION, ARRANGEMENT, ADJUSTMENT, PROTECTION, RELIEF, OR COMPOSITION OF
IT OR ITS DEBTS UNDER ANY DEBTOR RELIEF LAW, OR SEEKING THE ENTRY OF AN ORDER
FOR RELIEF OR THE APPOINTMENT OF A RECEIVER, TRUSTEE, ADMINISTRATOR OR OTHER
SIMILAR OFFICIAL FOR IT OR FOR ANY SUBSTANTIAL PART OF ITS PROPERTY AND ASSETS
AND, IN THE CASE OF ANY SUCH PROCEEDING INSTITUTED AGAINST IT (BUT NOT
INSTITUTED BY IT) THAT IS BEING DILIGENTLY CONTESTED BY IT IN GOOD FAITH, EITHER
SUCH PROCEEDING SHALL REMAIN UNDISMISSED OR UNSTAYED FOR A PERIOD OF AT LEAST 60
CONSECUTIVE DAYS OR ANY OF THE ACTIONS SOUGHT IN SUCH PROCEEDING (INCLUDING,
WITHOUT LIMITATION, THE ENTRY OF AN ORDER FOR RELIEF AGAINST, OR THE APPOINTMENT
OF A RECEIVER, TRUSTEE, CUSTODIAN OR OTHER SIMILAR OFFICIAL FOR, IT OR ANY
SUBSTANTIAL PART OF ITS PROPERTY AND ASSETS) SHALL OCCUR; OR ANY EVENT OR ACTION
ANALOGOUS TO OR HAVING A SUBSTANTIALLY SIMILAR EFFECT TO ANY OF THE EVENTS OR
ACTIONS SET FORTH ABOVE IN THIS SECTION 8.01(F) (OTHER THAN A SOLVENT
REORGANIZATION) SHALL OCCUR UNDER THE REQUIREMENTS OF LAW OF ANY JURISDICTION
APPLICABLE TO ANY OF THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES; OR ANY OF
THE LOAN PARTIES OR ANY OF THEIR SUBSIDIARIES SHALL TAKE ANY CORPORATE,
PARTNERSHIP, LIMITED LIABILITY COMPANY OR OTHER SIMILAR ACTION TO AUTHORIZE ANY
OF THE ACTIONS SET FORTH ABOVE IN THIS SECTION 8.01(F); OR

 

(G)           ONE OR MORE JUDGMENTS OR ORDERS FOR THE PAYMENT OF MONEY IN EXCESS
OF $10,000,000 IN THE AGGREGATE SHALL BE RENDERED AGAINST ONE OR MORE OF THE
LOAN PARTIES AND THEIR SUBSIDIARIES AND SHALL REMAIN UNSATISFIED AND EITHER
(I) ENFORCEMENT PROCEEDINGS SHALL HAVE BEEN COMMENCED BY ANY CREDITOR UPON ANY
SUCH JUDGMENT OR ORDER AND REMAIN UNSTAYED OR (II) THERE SHALL BE ANY PERIOD OF
AT LEAST 60 CONSECUTIVE DAYS DURING WHICH A STAY OF ENFORCEMENT OF ANY SUCH
JUDGMENT OR ORDER, BY REASON OF A PENDING APPEAL OR OTHERWISE, SHALL NOT BE IN
EFFECT; PROVIDED, HOWEVER, THAT ANY SUCH JUDGMENT OR ORDER SHALL NOT GIVE RISE
TO AN EVENT OF DEFAULT UNDER THIS SECTION 8.01(G) IF AND FOR SO LONG AS (A) THE
AMOUNT OF SUCH JUDGMENT OR ORDER WHICH REMAINS UNSATISFIED IS COVERED BY A VALID

 

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AND BINDING POLICY OF INSURANCE BETWEEN THE DEFENDANT AND THE INSURER COVERING
FULL PAYMENT THEREOF (OTHER THAN FOR DEDUCTIBLES) AND (B) SUCH INSURER HAS BEEN
NOTIFIED, AND HAS NOT DISPUTED THE CLAIM MADE FOR PAYMENT, OF THE AMOUNT OF SUCH
JUDGMENT OR ORDER; OR

 

(H)           ANY PROVISION OF ANY OF THE LOAN DOCUMENTS AFTER DELIVERY THEREOF
PURSUANT TO SECTION 4.01, 6.11 OR 6.15 SHALL FOR ANY REASON (OTHER THAN PURSUANT
TO THE TERMS THEREOF OR EXPRESSLY PERMITTED HEREUNDER (INCLUDING AS A RESULT OF
A TRANSACTION PERMITTED BY SECTION 7.03 OR 7.04)) CEASE TO BE VALID AND BINDING
ON OR ENFORCEABLE AGAINST ANY OF THE LOAN PARTIES INTENDED TO BE A PARTY TO IT,
OR ANY SUCH LOAN PARTY SHALL SO STATE IN WRITING; OR

 

(I)            ANY COLLATERAL DOCUMENT AFTER DELIVERY THEREOF PURSUANT TO
SECTION 4.01, 6.11 OR 6.15 SHALL FOR ANY REASON (OTHER THAN PURSUANT TO THE
TERMS THEREOF, INCLUDING AS A RESULT OF A TRANSACTION PERMITTED BY SECTION 7.03
OR 7.04) CEASE TO CREATE A VALID AND PERFECTED FIRST PRIORITY (SUBJECT TO THE
LIENS AND SECURITY INTERESTS EXPRESSLY PERMITTED UNDER SECTION 7.01) LIEN ON AND
SECURITY INTEREST IN THE COLLATERAL PURPORTED TO BE COVERED THEREBY; OR

 

(J)            ANY OF THE FOLLOWING EVENTS OR CONDITIONS SHALL HAVE OCCURRED AND
SUCH EVENT OR CONDITION, WHEN AGGREGATED WITH ANY AND ALL OTHER SUCH EVENTS OR
CONDITIONS SET FORTH IN THIS SECTION 8.01(J), HAS RESULTED, OR, WITH RESPECT TO
CLAUSE (I) OF THIS SECTION 8.01(J), COULD REASONABLY BE EXPECTED TO RESULT, IN
LIABILITIES OF ONE OR MORE OF THE LOAN PARTIES AND/OR THE ERISA AFFILIATES IN AN
AGGREGATE AMOUNT EXCEEDING $10,000,000 AT ANY TIME:

 

(i)            any ERISA Event shall have occurred or

 

(ii)           any of the Loan Parties or any of the ERISA Affiliates shall have
incurred Withdrawal Liability to a Multiemployer Plan or liability in connection
with the reorganization, insolvency or termination of a Multiemployer Plan; or

 

(iii)          any “accumulated funding deficiency” (as defined in Section 302
of ERISA and Section 412 of the Internal Revenue Code), whether or not waived,
shall exist with respect to one or more of the Plans, or any Lien shall exist on
the property and assets of any of the Loan Parties or any of the ERISA
Affiliates in favor of the PBGC or any Plan; or

 

(K)           AN “EVENT OF DEFAULT” (AS DEFINED IN THE APPLICABLE SENIOR
SUBORDINATED NOTES DOCUMENTS) SHALL HAVE OCCURRED AND BE CONTINUING UNDER THE
SENIOR SUBORDINATED NOTES DOCUMENTS; OR

 

(L)            A CHANGE OF CONTROL SHALL OCCUR;

 

then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitments of each of the Lenders and the obligation of each of the
Lenders to make Loans (other than Swing Line Loans by any of the Revolving
Credit Lenders pursuant to Section 2.04(c)(ii) and L/C Advances

 

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by the Issuing Bank or any of the Revolving Credit Lenders pursuant to
Section 2.03(c)(i)) and of the Issuing Bank to issue Letters of Credit to be
terminated, whereupon the same shall forthwith terminate, and (ii) shall at the
request, or may with the consent, of the Required Lenders, by notice to the
Borrower, declare the Notes, all interest thereon and all other amounts payable
under or in respect of this Agreement and the other Loan Documents to be
forthwith due and payable, whereupon the Notes, all such interest and all such
other amounts shall become and be forthwith due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by the Borrower; provided, however, that in the event of
an actual or deemed entry of an order for relief with respect to the Borrower
under the United States Federal Bankruptcy Code or a similar order or action
under any other Debtor Relief Law, (1) the Commitments of each of the Lenders
and the obligation of each of the Lenders to make Loans (other than Swing Line
Loans by any of the Revolving Credit Lenders pursuant to Section 2.04(c)(ii) and
L/C Advances by the Issuing Bank or any of the Revolving Credit Lenders pursuant
to Section 2.03(c)(i)) and of the Issuing Bank to issue Letters of Credit shall
automatically be terminated and (2) the Notes, all such interest and all such
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by the Borrower.

 

8.02         Actions in Respect of the Letters of Credit upon Default  If any
Event of Default shall have occurred and be continuing, the Administrative Agent
may, or shall at the request of the Required Lenders, irrespective of whether it
is taking any of the actions described in Section 8.01 or otherwise, make demand
upon the Borrower to, and forthwith upon such demand the Borrower will, pay to
the Administrative Agent, on behalf of the Lenders, in same day funds at the
Administrative Agent’s office designated in such demand, for deposit in the L/C
Cash Collateral Account, an amount equal to the amount then available to be
drawn under all outstanding Letters of Credit (the “Available Amount”).  If at
any time the Administrative Agent determines that any funds held in the L/C Cash
Collateral Account are subject to any right or claim of any Person other than
the Agents and the other Secured Parties or that the total amount of such funds
is less than the aggregate Available Amount of all Letters of Credit, the
Borrower will, forthwith upon demand by the Administrative Agent, pay to the
Administrative Agent, as additional funds to be deposited and held in the L/C
Cash Collateral Account, an amount equal to the excess of (a) such aggregate
Available Amount over (b) the total amount of funds, if any, then held in the
L/C Cash Collateral Account.  Upon the drawing of any Letter of Credit for which
funds are on deposit in the L/C Cash Collateral Account, such funds shall be
applied to reimburse the Issuing Bank or the Revolving Credit Lenders, as
applicable, to the extent permitted under applicable law.

 

8.03         Application of Funds.  After the exercise of remedies provided for
in Section 8.01 (or after the Loans have automatically become immediately due
and payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in Section 8.02), any amounts received on account of
the Obligations shall be applied by the Administrative Agent in the following
order:

 

First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs payable under
Section 10.04 and amounts payable under Article III and Section 10.15) payable
to the Agents in their

 

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capacities as such ratably among them in proportion to the amounts described in
this clause First payable to them;

 

Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest) payable to the
Lenders (including Attorney Costs payable under Section 10.04 and amounts
payable under Article III and Section 10.15), ratably among them in proportion
to the amounts described in this clause Second payable to them;

 

Third, to payment of that portion of the Obligations constituting accrued and
unpaid interest on the Loans and L/C Borrowings, ratably among the Lenders in
proportion to the respective amounts described in this clause Third payable to
them;

 

Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans and L/C Borrowings, ratably among the Lenders in
proportion to the respective amounts described in this clause Fourth held by
them;

 

Fifth, to the Administrative Agent for the account of the L/C Issuer, to Cash
Collateralize that portion of L/C Obligations comprised of the aggregate undrawn
amount of Letters of Credit;

 

Sixth, to the payment of all other Obligations of the Loan Parties owing under
or in respect of the Loan Documents that are due and payable to the Agents and
the other Secured Parties on such date, ratably based upon the respective
aggregate amounts of all such Obligations owing to the Agents and the other
Secured Parties on such date; and

 

Last, the balance, if any, after all of the Obligations have been paid in full,
to the Borrower or as otherwise required by Law.

 

Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Fifth above shall be
applied to satisfy drawings under such Letters of Credit as they occur.  If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.

 

ARTICLE IX
ADMINISTRATIVE AGENT AND OTHER AGENTS

 

9.01         Appointment and Authorization of Agents.

 

(A)           EACH LENDER HEREBY IRREVOCABLY APPOINTS, DESIGNATES AND AUTHORIZES
THE ADMINISTRATIVE 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, NO AGENT SHALL HAVE
ANY DUTIES OR RESPONSIBILITIES, EXCEPT THOSE EXPRESSLY SET FORTH HEREIN, NOR
SHALL ANY AGENT HAVE OR BE DEEMED TO HAVE ANY FIDUCIARY RELATIONSHIP WITH ANY
LENDER OR PARTICIPANT, AND NO IMPLIED

 

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COVENANTS, FUNCTIONS, RESPONSIBILITIES, DUTIES, OBLIGATIONS OR LIABILITIES SHALL
BE READ INTO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR OTHERWISE EXIST
AGAINST ANY 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 ANY 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)           THE L/C ISSUER SHALL ACT ON BEHALF OF THE LENDERS WITH RESPECT TO
ANY LETTERS OF CREDIT ISSUED BY IT AND THE DOCUMENTS ASSOCIATED THEREWITH, AND
THE L/C ISSUER SHALL HAVE ALL OF THE BENEFITS AND IMMUNITIES (I) PROVIDED TO THE
AGENTS IN THIS ARTICLE IX WITH RESPECT TO ANY ACTS TAKEN OR OMISSIONS SUFFERED
BY THE L/C ISSUER IN CONNECTION WITH LETTERS OF CREDIT ISSUED BY IT OR PROPOSED
TO BE ISSUED BY IT AND THE APPLICATIONS AND AGREEMENTS FOR LETTERS OF CREDIT
PERTAINING TO SUCH LETTERS OF CREDIT AS FULLY AS IF THE TERM “AGENT” AS USED IN
THIS ARTICLE IX AND IN THE DEFINITION OF “AGENT-RELATED PERSON” INCLUDED THE L/C
ISSUER WITH RESPECT TO SUCH ACTS OR OMISSIONS, AND (II) AS ADDITIONALLY PROVIDED
HEREIN WITH RESPECT TO THE L/C ISSUER.

 

(C)           THE ADMINISTRATIVE AGENT SHALL ALSO ACT AS THE “COLLATERAL AGENT”
UNDER THE LOAN DOCUMENTS, AND EACH OF THE LENDERS (IN ITS CAPACITIES AS A
LENDER, SWING LINE LENDER (IF APPLICABLE), L/C ISSUER (IF APPLICABLE) AND A
POTENTIAL HEDGE BANK) HEREBY IRREVOCABLY APPOINTS AND AUTHORIZES THE
ADMINISTRATIVE AGENT TO ACT AS THE AGENT OF SUCH LENDER FOR PURPOSES OF
ACQUIRING, HOLDING AND ENFORCING ANY AND ALL LIENS ON COLLATERAL GRANTED BY ANY
OF THE LOAN PARTIES TO SECURE ANY OF THE SECURED OBLIGATIONS, TOGETHER WITH SUCH
POWERS AND DISCRETION AS ARE REASONABLY INCIDENTAL THERETO.  IN THIS CONNECTION,
THE ADMINISTRATIVE AGENT, AS “COLLATERAL AGENT” (AND ANY CO-AGENTS, SUB-AGENTS
AND ATTORNEYS-IN-FACT APPOINTED BY THE ADMINISTRATIVE AGENT PURSUANT TO SECTION
9.02 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 ADMINISTRATIVE AGENT),
SHALL BE ENTITLED TO THE BENEFITS OF ALL PROVISIONS OF THIS ARTICLE IX
(INCLUDING, WITHOUT LIMITATION, SECTION 9.07, 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.

 

9.02         Delegation of Duties.  The Administrative 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 Administrative Agent
shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects in the absence of gross negligence or willful
misconduct.

 

9.03         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
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

 

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any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Administrative 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.

 

9.04         Reliance by Agents.

 

(A)           EACH 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 SUCH AGENT.  EACH 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
REQUIRED LENDERS AS IT DEEMS APPROPRIATE AND, IF IT SO REQUESTS, IT SHALL FIRST
BE INDEMNIFIED TO ITS SATISFACTION BY THE LENDERS AGAINST ANY AND ALL LIABILITY
AND EXPENSE WHICH MAY BE INCURRED BY IT BY REASON OF TAKING OR CONTINUING TO
TAKE ANY SUCH ACTION.  EACH 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 REQUIRED LENDERS (OR
SUCH GREATER NUMBER OF LENDERS AS MAY BE EXPRESSLY REQUIRED HEREBY IN ANY
INSTANCE) AND SUCH REQUEST AND ANY ACTION TAKEN OR FAILURE TO ACT PURSUANT
THERETO SHALL BE BINDING UPON ALL THE LENDERS.

 

(B)           FOR PURPOSES OF DETERMINING COMPLIANCE WITH THE CONDITIONS
SPECIFIED IN SECTION 4.01, EACH LENDER THAT HAS SIGNED THIS AGREEMENT SHALL BE
DEEMED TO HAVE CONSENTED TO, APPROVED OR ACCEPTED OR TO BE SATISFIED WITH, EACH
DOCUMENT OR OTHER MATTER REQUIRED THEREUNDER TO BE CONSENTED TO OR APPROVED BY
OR ACCEPTABLE OR SATISFACTORY TO A LENDER UNLESS THE ADMINISTRATIVE AGENT SHALL
HAVE RECEIVED NOTICE FROM SUCH LENDER PRIOR TO THE PROPOSED CLOSING DATE
SPECIFYING ITS OBJECTION THERETO.

 

9.05         Notice of Default.  The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default, except with respect
to defaults in the payment of principal, interest and fees required to be paid
to the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or the
Borrower referring to this Agreement, describing such Default and stating that
such notice is a “notice of default.”  The Administrative Agent will notify the
Lenders of its receipt of any such notice.  The Administrative Agent shall take
such action with respect to such Default as may be directed by the Required
Lenders in accordance with Article VIII; provided, however, that unless and
until the Administrative Agent has received any such direction, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking

 

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such action, with respect to such Event of Default as it shall deem advisable or
in the best interest of the Lenders.

 

9.06         Credit Decision; Disclosure of Information by Agents.  Each Lender
acknowledges that no Agent-Related Person has made any representation or
warranty to it, and that no act by any Agent hereafter taken, including any
consent to and acceptance of any assignment or 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 any Lender as to any matter,
including whether Agent-Related Persons have disclosed material information in
their possession.  Each Lender represents to each 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 respective 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. 
Each 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 Borrower and the other Loan
Parties.  Except for notices, reports and other documents expressly required to
be furnished to the Lenders by any Agent herein, such Agent shall not have any
duty or responsibility to provide any 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 respective Affiliates which may come into the possession of any
Agent-Related Person.

 

9.07         Indemnification of Agents.  Whether or not the transactions
contemplated hereby are consummated, the Lenders 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, and hold harmless each Agent-Related Person from and against any and all
Indemnified Liabilities incurred by it; provided, however, that no Lender shall
be liable for the payment to any Agent-Related Person of any portion of such
Indemnified Liabilities to the extent determined in a final, nonappealable
judgment by a court of competent jurisdiction to have resulted from such
Agent-Related Person’s own gross negligence or willful misconduct; provided,
however, that no action taken in accordance with the directions of the Required
Lenders shall be deemed to constitute gross negligence or willful misconduct for
purposes of this Section.  In the case of any investigation, litigation or
proceeding giving rise to any Indemnified Liabilities, this Section 9.07 applies
whether any such investigation, litigation or proceeding is brought by any
Lender or any other Person.  Without limitation of the foregoing, each Lender
shall reimburse the Administrative Agent upon demand for its ratable share of
any costs or out-of-pocket expenses (including Attorney Costs) incurred by the
Administrative Agent 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, to the extent that the
Administrative Agent is

 

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not reimbursed for such expenses by or on behalf of the Borrower.  The
undertaking in this Section shall survive the Termination Date and the
resignation of the Administrative Agent.

 

9.08         Agents in their Individual Capacities.  Each of Bank of America and
Citigroup and their respective Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire Equity Interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with each of the Loan Parties and their respective Affiliates
as though (i) Bank of America were not the Administrative Agent or the L/C
Issuer hereunder and (ii) Citigroup were not the Documentation Agent, and, in
each case, without notice to or consent of the Lenders.  The Lenders acknowledge
that, pursuant to such activities, each of Bank of America, Citigroup, or their
respective Affiliates may receive information regarding any Loan Party or its
Affiliates (including information that may be subject to confidentiality
obligations in favor of such Loan Party or such Affiliate) and acknowledge that
the Administrative Agent (in the case of Bank of America) and the Documentation
Agent (in the case of Citigroup) shall be under no obligation to provide such
information to them.  With respect to its Loans, each of Bank of America and
Citigroup shall have the same rights and powers under this Agreement as any
other Lender and may exercise such rights and powers as though it were not the
Administrative Agent or the L/C Issuer (in the case of Bank of America) or the
Documentation Agent (in the case of Citigroup), and the terms “Lender” and
“Lenders” include each of Bank of America and Citigroup in its individual
capacity.

 

9.09         Successor Agents.  The Administrative Agent may resign as the
Administrative Agent upon 30 days’ notice to the Lenders.  If the Administrative
Agent resigns under this Agreement, the Required Lenders shall appoint from
among the Lenders a successor agent for the Lenders, which successor agent shall
be consented to by the Borrower at all times other than during the existence of
an Event of Default under Section 8.01(f) (which consent of the Borrower shall
not be unreasonably withheld or delayed).  If no successor agent is appointed
prior to the Closing Date of the resignation of the Administrative Agent, the
Administrative Agent may appoint, after consulting with the Lenders and the
Borrower, a successor agent from among the Lenders.  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
Administrative Agent and the term “Administrative Agent” shall mean such
successor agent, and the retiring Administrative Agent’s appointment, powers and
duties as Administrative Agent shall be terminated.  After the retiring Agent’s
resignation hereunder as Agent, the provisions of this Article IX and
Sections 10.04 and 10.05 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was the Agent under this Agreement.  If no
successor agent has accepted appointment as Administrative Agent by the date
that is 30 days following a retiring Administrative Agent’s notice of
resignation, the retiring Administrative Agent’s resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties of
such Administrative Agent hereunder until such time, if any, as the Required
Lenders appoint a successor agent as provided for above.  Upon the acceptance of
any appointment as Administrative Agent hereunder by a successor and upon the
execution and filing or recording of such financing statements, or amendments
thereto, and such amendments or supplements to the Mortgages, and such other
instruments or notices, as may be necessary or desirable, or as the Required
Lenders may request, in order to continue the perfection of the Liens granted or
purported to be granted by the Collateral Documents, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers,

 

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discretion, privileges, and duties of the retiring Administrative Agent, and the
retiring Administrative Agent shall be discharged from its duties and
obligations under the Loan Documents.  After any retiring Administrative Agent’s
resignation hereunder as the Administrative 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 an Agent.

 

9.10         Administrative Agent May File Proofs of Claim.  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 Administrative Agent (irrespective of
whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the Administrative Agent shall have made any demand on the Borrower)
shall be entitled and empowered, by intervention in such proceeding or otherwise

 

(A)           TO FILE AND PROVE A CLAIM FOR THE WHOLE AMOUNT OF THE PRINCIPAL
AND INTEREST OWING AND UNPAID IN RESPECT OF THE LOANS, L/C OBLIGATIONS 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 LENDERS AND THE
AGENTS (INCLUDING ANY CLAIM FOR THE REASONABLE COMPENSATION, EXPENSES,
DISBURSEMENTS AND LOANS OF THE LENDERS AND THE AGENTS AND THEIR RESPECTIVE
AGENTS AND COUNSEL AND ALL OTHER AMOUNTS DUE THE LENDERS AND THE AGENTS UNDER
SECTIONS 2.03(I) AND (J), 2.09 AND 10.04) 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, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and Loans of the Agents and
their respective agents and counsel, and any other amounts due the Agents under
Sections 2.09 and 10.04.

 

Nothing contained herein shall be deemed to authorize the Administrative Agent
to authorize or consent to or accept or adopt on behalf of any Lender any plan
of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or to authorize the Administrative Agent
to vote in respect of the claim of any Lender in any such proceeding.

 

9.11         Collateral and Guaranty Matters.  The Lenders irrevocably authorize
the Administrative Agent, at its option and in its discretion,

 

(A)           TO RELEASE ANY LIEN ON ANY PROPERTY GRANTED TO OR HELD BY THE
ADMINISTRATIVE AGENT UNDER ANY LOAN DOCUMENT (I) UPON THE TERMINATION DATE, (II)
THAT IS SOLD OR TO BE SOLD AS PART OF OR IN CONNECTION WITH ANY SALE PERMITTED
HEREUNDER OR UNDER

 

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ANY OTHER LOAN DOCUMENT, OR (III) SUBJECT TO SECTION 10.01, IF APPROVED,
AUTHORIZED OR RATIFIED IN WRITING BY THE REQUIRED LENDERS; AND

 

(B)           TO RELEASE ANY GUARANTOR FROM ITS OBLIGATIONS UNDER THE GUARANTY
AND ANY OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY IF SUCH PERSON CEASES TO BE A
SUBSIDIARY AS A RESULT OF A TRANSACTION PERMITTED HEREUNDER.

 

Upon request by the Administrative Agent at any time, the Required Lenders will
confirm in writing the Administrative Agent’s authority to release its interest
in particular types or items of property, or to release any Guarantor from its
obligations under the Loan Documents pursuant to this Section 9.11.  In each
case as specified in this Section 9.11, the Administrative Agent will, at the
Borrower’s expense, execute and deliver to the applicable Loan Party such
documents as such Loan Party may reasonably request to evidence the release of
such item of Collateral from the assignment and security interest granted under
the Collateral Documents, or to release such Guarantor from its obligations
under the Loan Documents, in each case in accordance with the terms of the Loan
Documents and this Section 9.11.

 

9.12         Other Agents; Arrangers and Managers.  None of the Lenders or other
Persons identified on the facing page or signature pages of this Agreement as a
“documentation agent,” “joint book manager” or “joint lead arranger” shall have
any right, power, obligation, liability, responsibility or duty under this
Agreement other than, in the case of such Lenders, those applicable to all
Lenders as such.  Without limiting the foregoing, none of the Lenders or other
Persons so identified shall have or be deemed to have any fiduciary relationship
with any Lender.  Each Lender acknowledges that it has not relied, and will not
rely, on any of the Lenders or other Persons so identified in deciding to enter
into this Agreement or in taking or not taking action hereunder.

 

ARTICLE X
MISCELLANEOUS

 

10.01       Amendments, Etc.  No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the
Borrower or any other Loan Party therefrom, shall be effective unless in writing
signed by the Required Lenders and the Borrower or the applicable Loan Party, as
the case may be, and each such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no such amendment, waiver or consent shall:

 

(A)           EXTEND OR INCREASE THE COMMITMENT OF ANY LENDER WITHOUT THE
WRITTEN CONSENT OF EACH LENDER DIRECTLY AFFECTED THEREBY (IT BEING UNDERSTOOD
THAT A WAIVER OF ANY CONDITION PRECEDENT SET FORTH IN SECTION 4.02 OR THE WAIVER
OF ANY EVENT OF DEFAULT, MANDATORY PREPAYMENT OR MANDATORY REDUCTION OF THE
COMMITMENTS SHALL NOT CONSTITUTE AN EXTENSION OR INCREASE OF ANY COMMITMENT OF
ANY LENDER);

 

(B)           POSTPONE ANY DATE SCHEDULED FOR ANY PAYMENT OF PRINCIPAL OR
INTEREST UNDER SECTIONS 2.07 OR 2.08 WITHOUT THE WRITTEN CONSENT OF EACH LENDER
DIRECTLY AFFECTED THEREBY, IT BEING UNDERSTOOD THAT THE WAIVER OF ANY MANDATORY
PREPAYMENT OF THE TERM

 

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LOANS SHALL NOT CONSTITUTE A POSTPONEMENT OF ANY DATE SCHEDULED FOR THE PAYMENT
OF PRINCIPAL OR INTEREST;

 

(C)           REDUCE THE PRINCIPAL OF, OR THE RATE OF INTEREST SPECIFIED HEREIN
ON, ANY LOAN OR L/C BORROWING, OR (SUBJECT TO CLAUSE (III) OF THE SECOND PROVISO
TO THIS SECTION 10.01) ANY FEES OR OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER ANY
OTHER LOAN DOCUMENT  WITHOUT THE WRITTEN CONSENT OF EACH LENDER DIRECTLY
AFFECTED THEREBY, IT BEING UNDERSTOOD THAT ANY CHANGE TO THE DEFINITION OF TOTAL
LEVERAGE RATIO OR IN THE COMPONENT DEFINITIONS THEREOF SHALL NOT CONSTITUTE A
REDUCTION IN THE RATE; PROVIDED, HOWEVER, THAT ONLY THE CONSENT OF THE REQUIRED
LENDERS SHALL BE NECESSARY TO AMEND THE DEFINITION OF “DEFAULT RATE” OR TO WAIVE
ANY OBLIGATION OF THE BORROWER TO PAY INTEREST AT THE DEFAULT RATE;

 

(D)           CHANGE THE ORDER OF APPLICATION OF ANY REDUCTION IN THE
COMMITMENTS OR ANY PREPAYMENT OF LOANS AMONG THE FACILITIES FROM THE APPLICATION
THEREOF SET FORTH IN THE APPLICABLE PROVISIONS OF SECTION 2.06(B) OR 2.05(B),
RESPECTIVELY, IN ANY MANNER THAT MATERIALLY AND ADVERSELY AFFECTS THE LENDERS
UNDER SUCH FACILITIES WITHOUT THE WRITTEN CONSENT OF LENDERS HAVING MORE THAN
50% OF THE AGGREGATE CREDIT EXPOSURES THEN IN EFFECT WITHIN EACH OF THE
FOLLOWING CLASSES OF COMMITMENTS, LOANS AND OTHER CREDIT EXTENSIONS: (I) THE
CLASS CONSISTING OF THE REVOLVING CREDIT COMMITMENT COMBINED ON AN AGGREGATE
BASIS AND (II) THE CLASS CONSISTING OF THE TERM COMMITMENT COMBINED ON AN
AGGREGATE BASIS;

 

(E)           CHANGE THE PRO RATA SHARING OF ANY REDUCTION IN THE COMMITMENTS OR
ANY PREPAYMENT OF LOANS BETWEEN THE DOLLAR TERM FACILITY AND THE CANADIAN TERM
FACILITY SET FORTH IN SECTION 2.05 AND SECTION 2.06 WITHOUT THE WRITTEN CONSENT
OF LENDERS HAVING MORE THAN 50% OF THE AGGREGATE CREDIT EXPOSURES THEN IN EFFECT
WITHIN EACH OF THE FOLLOWING CLASSES OF COMMITMENTS, LOANS AND OTHER CREDIT
EXTENSIONS: (I) THE CLASS CONSISTING OF THE DOLLAR TERM COMMITMENT COMBINED ON
AN AGGREGATE BASIS AND (II) THE CLASS CONSISTING OF THE CANADIAN TERM COMMITMENT
COMBINED ON AN AGGREGATE BASIS;

 

(F)            CHANGE ANY PROVISION OF THIS SECTION 10.01 OR THE DEFINITION OF
“REQUIRED LENDERS” OR SECTION 2.06(C) WITHOUT THE WRITTEN CONSENT OF EACH
LENDER;

 

(G)           RELEASE ALL OR SUBSTANTIALLY ALL OF THE COLLATERAL IN ANY
TRANSACTION OR SERIES OF RELATED TRANSACTIONS, WITHOUT THE WRITTEN CONSENT OF
EACH LENDER; OR

 

(H)           RELEASE ALL OR SUBSTANTIALLY ALL OF THE VALUE OF THE GUARANTY,
WITHOUT THE WRITTEN CONSENT OF EACH LENDER;

 

and provided further that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Letter
of Credit Application relating to any Letter of Credit issued or to be issued by
it; (ii) no amendment, waiver or consent shall, unless in writing and signed by
the Swing Line Lender in addition to the Lenders required above, affect the
rights or duties of the Swing Line Lender under this Agreement; (iii) no
amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above, affect the
rights or duties of, or any fees or other amounts payable to, the

 

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Administrative Agent under this Agreement or any other Loan Document; (iv)
Section 10.07(h) may not be amended, waived or otherwise modified without the
consent of each Granting Lender all or any part of whose Loans are being funded
by an SPC at the time of such amendment, waiver or other modification; and (v)
the Fee Letter may be amended, or rights or privileges thereunder waived, in a
writing executed only by the parties thereto.  Notwithstanding anything to the
contrary herein, no Defaulting Lender shall have any right to approve or
disapprove any amendment, waiver or consent hereunder, except that the
Commitment of such Lender may not be increased or extended without the consent
of such Lender (it being understood that any Commitments or Loans held or deemed
held by any Defaulting Lender shall be excluded from a vote of the Lenders
hereunder requiring any consent of the Lenders).

 

10.02       Notices and Other Communications; Facsimile Copies.

 

(A)           GENERAL.  UNLESS OTHERWISE EXPRESSLY PROVIDED HEREIN, ALL NOTICES
AND OTHER COMMUNICATIONS PROVIDED FOR HEREUNDER OR ANY OTHER LOAN DOCUMENT SHALL
BE IN WRITING (INCLUDING BY FACSIMILE TRANSMISSION).  ALL SUCH WRITTEN NOTICES
SHALL BE MAILED, FAXED OR DELIVERED TO THE APPLICABLE ADDRESS, FACSIMILE NUMBER
OR (SUBJECT TO SECTION 10.02(C)) ELECTRONIC MAIL ADDRESS, AND ALL NOTICES AND
OTHER COMMUNICATIONS EXPRESSLY PERMITTED HEREUNDER TO BE GIVEN BY TELEPHONE
SHALL BE MADE TO THE APPLICABLE TELEPHONE NUMBER, AS FOLLOWS:

 

(I)            IF TO THE BORROWER, THE ADMINISTRATIVE AGENT, THE L/C ISSUER OR
THE SWING LINE LENDER, TO THE ADDRESS, FACSIMILE NUMBER, ELECTRONIC MAIL ADDRESS
OR TELEPHONE NUMBER SPECIFIED FOR SUCH PERSON ON SCHEDULE 10.02 OR TO SUCH OTHER
ADDRESS, FACSIMILE NUMBER, ELECTRONIC MAIL ADDRESS OR TELEPHONE NUMBER AS SHALL
BE DESIGNATED BY SUCH PARTY IN A NOTICE TO THE OTHER PARTIES; AND

 

(II)           IF TO ANY OTHER LENDER, TO THE ADDRESS, FACSIMILE NUMBER,
ELECTRONIC MAIL ADDRESS OR TELEPHONE NUMBER SPECIFIED IN ITS ADMINISTRATIVE
QUESTIONNAIRE OR TO SUCH OTHER ADDRESS, FACSIMILE NUMBER, ELECTRONIC MAIL
ADDRESS OR TELEPHONE NUMBER AS SHALL BE DESIGNATED BY SUCH PARTY IN A NOTICE TO
THE BORROWER, THE ADMINISTRATIVE AGENT, THE L/C ISSUER AND THE SWING LINE
LENDER.

 

Notices sent by hand or courier service shall be deemed to have been given when
received; notices sent by mail shall be deemed to have been given four (4)
Business Days after deposit in the mails, postage prepaid; notices sent by
facsimile shall be deemed to have been given when sent and receipt has been
confirmed by telephone (except that, if not given during normal business hours
for the recipient, shall be deemed to have been given at the opening of business
on the next Business Day for the recipient).  Notices delivered through
electronic communications to the extent provided in subsection (b) below shall
be effective as provided in such subsection (b).

 

(B)           ELECTRONIC COMMUNICATIONS.  NOTICES AND OTHER COMMUNICATIONS TO
THE LENDERS HEREUNDER MAY BE DELIVERED OR FURNISHED BY ELECTRONIC COMMUNICATION
(INCLUDING E-MAIL AND INTERNET OR INTRANET WEBSITES) PURSUANT TO PROCEDURES
APPROVED BY THE ADMINISTRATIVE AGENT, PROVIDED THAT THE FOREGOING SHALL NOT
APPLY TO NOTICES TO ANY LENDER PURSUANT TO ARTICLE II IF SUCH LENDER HAS
NOTIFIED THE ADMINISTRATIVE AGENT THAT IT IS INCAPABLE OF RECEIVING NOTICES
UNDER SUCH ARTICLE BY ELECTRONIC COMMUNICATION.  THE ADMINISTRATIVE AGENT OR THE
BORROWER MAY, IN ITS

 

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DISCRETION, AGREE TO ACCEPT NOTICES AND OTHER COMMUNICATIONS TO IT HEREUNDER BY
ELECTRONIC COMMUNICATIONS PURSUANT TO PROCEDURES APPROVED BY IT, PROVIDED THAT
APPROVAL OF SUCH PROCEDURES MAY BE LIMITED TO PARTICULAR NOTICES OR
COMMUNICATIONS.

 

(C)           EFFECTIVENESS OF FACSIMILE DOCUMENTS AND SIGNATURES.  LOAN
DOCUMENTS MAY BE TRANSMITTED AND/OR SIGNED BY FACSIMILE.  THE EFFECTIVENESS OF
ANY SUCH DOCUMENTS AND SIGNATURES SHALL, SUBJECT TO APPLICABLE LAW, HAVE THE
SAME FORCE AND EFFECT AS MANUALLY-SIGNED ORIGINALS AND SHALL BE BINDING ON ALL
LOAN PARTIES, THE AGENTS AND THE LENDERS.  THE ADMINISTRATIVE AGENT MAY ALSO
REQUIRE THAT ANY SUCH DOCUMENTS AND SIGNATURES BE CONFIRMED BY A MANUALLY-SIGNED
ORIGINAL THEREOF; PROVIDED, HOWEVER, THAT THE FAILURE TO REQUEST OR DELIVER THE
SAME SHALL NOT LIMIT THE EFFECTIVENESS OF ANY FACSIMILE DOCUMENT OR SIGNATURE.

 

(D)           RELIANCE BY AGENTS AND LENDERS.  THE AGENTS AND THE LENDERS SHALL
BE ENTITLED TO RELY AND ACT UPON ANY NOTICES (INCLUDING TELEPHONIC COMMITTED
LOAN NOTICES AND SWING LINE LOAN NOTICES) PURPORTEDLY GIVEN BY OR ON BEHALF OF
THE BORROWER EVEN IF (I) SUCH NOTICES WERE NOT MADE IN A MANNER SPECIFIED
HEREIN, WERE INCOMPLETE OR WERE NOT PRECEDED OR FOLLOWED BY ANY OTHER FORM OF
NOTICE SPECIFIED HEREIN, OR (II) THE TERMS THEREOF, AS UNDERSTOOD BY THE
RECIPIENT, VARIED FROM ANY CONFIRMATION THEREOF.  THE BORROWER SHALL INDEMNIFY
EACH AGENT-RELATED PERSON AND EACH LENDER FROM ALL LOSSES, COSTS, EXPENSES AND
LIABILITIES RESULTING FROM THE RELIANCE BY SUCH PERSON ON EACH NOTICE
PURPORTEDLY GIVEN BY OR ON BEHALF OF THE BORROWER IN THE ABSENCE OF GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.  ALL TELEPHONIC NOTICES TO THE ADMINISTRATIVE
AGENT MAY BE RECORDED BY SUCH AGENT, AND EACH OF THE PARTIES HERETO HEREBY
CONSENTS TO SUCH RECORDING.

 

10.03       No Waiver; Cumulative Remedies.  No failure by any Lender or the
Administrative Agent to exercise, and no delay by any such Person in exercising,
any right, remedy, power or privilege hereunder or any other Loan Document shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or
privilege.  The rights, remedies, powers and privileges herein provided, and
provided under each other Loan Document, are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.

 

10.04       Attorney Costs, Expenses and Taxes.  The Borrower agrees (a) to pay
or reimburse the Administrative Agent for all reasonable costs and expenses
incurred in connection with the development, 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 hereby or thereby are
consummated), and the consummation and administration of the transactions
contemplated hereby and thereby, including all Attorney Costs of Shearman &
Sterling LLP, and (b) to pay or reimburse the Administrative Agent and each
Lender for all reasonable costs and expenses incurred in connection with the
enforcement 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), including all
Attorney Costs of counsel to the Administrative Agent).  The foregoing costs and
expenses shall include all search, filing, recording, title insurance and
appraisal charges and fees and taxes related thereto, and other out-of-pocket
expenses incurred by any Agent.  All amounts due under this

 

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Section 10.04 shall be paid within thirty (30) Business Days after invoiced or
demand therefor.  The agreements in this Section shall survive the Termination
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, including, without
limitation, Attorney Costs and indemnities, such amount may be paid on behalf of
such Loan Party by any Agent or any Lender, in its sole discretion.

 

10.05       Indemnification by the Borrower.  Whether or not the transactions
contemplated hereby are consummated, the Borrower shall indemnify and hold
harmless each Agent-Related Person, each Lender and their respective Affiliates,
directors, officers, employees, counsel, agents and, in the case of any funds,
trustees and advisors and attorneys-in-fact (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 one (1)
counsel to the Administrative Agent and the Lenders, unless (x) the interests of
the Administrative Agent and the Lenders are sufficiently divergent, in which
case one (1) additional counsel may be appointed, and (y) if the interests of
any Lender or group of Lenders (other than all of the Lenders) are distinctly or
disproportionately affected, one (1) additional counsel for such Lender or group
of Lenders)) 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, Loan or Letter of Credit or the use or proposed use
of the proceeds therefrom (including any refusal by the L/C Issuer to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such Letter
of Credit), (c) any actual or alleged presence or release of Hazardous Materials
on or from any property currently or formerly owned or operated by the Borrower,
any Subsidiary or any other Loan Party, or any Environmental Liability related
in any way to the Borrower, any Subsidiary or any other Loan Party, or (d) 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”), provided that 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 are determined by a court of competent jurisdiction by
final and nonappealable judgment to (a) have resulted from the gross negligence
or willful misconduct of such Indemnitee or breach of any Loan Document by such
Indemnitee or (b) arise from claims of any of the Lenders solely against one or
more other Lenders (and not by one or more Lenders against the Administrative
Agent or one or more of the other Agents) that have not resulted from the
action, inaction, participation or contribution of the Borrower or its
Subsidiaries or other Affiliates or any of their respective officers, directors,
stockholders, partners, members, employees, agents, representatives or
advisors.  No Indemnitee shall be liable for any damages arising from the use by
others of any information or other materials obtained through IntraLinks or
other similar information transmission systems in connection with this
Agreement, nor shall any Indemnitee or any Loan Party have any liability for any
special, punitive, indirect or consequential damages relating to this Agreement
or any

 

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other Loan Document or arising out of its activities in connection herewith or
therewith (whether before or after the Closing Date).  In the case of an
investigation, litigation or other proceeding to which the indemnity in this
Section 10.05 applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by any Loan Party, its
directors, shareholders 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 is consummated.  All amounts due under this Section 10.05 shall be
payable within twenty (20) Business Days after demand therefor.  The agreements
in this Section shall survive the resignation of the Administrative Agent, the
replacement of any Lender and the Termination Date.

 

10.06       Payments Set Aside.  To the extent that any payment by or on behalf
of the Borrower is made to any Agent or any Lender, or any Agent or any Lender
exercises its right of setoff, and such payment or the proceeds of such setoff
or any part thereof is subsequently invalidated, declared to be fraudulent or
preferential, set aside or required (including pursuant to any settlement
entered into by such Agent or such Lender in its discretion) to be repaid to a
trustee, receiver or any other party, in connection with any proceeding under
any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied shall be revived
and continued in full force and effect as if such payment had not been made or
such setoff had not occurred, and (b) each Lender severally agrees to pay to the
Administrative Agent upon demand its applicable share of any amount so recovered
from or repaid by any Agent, plus interest thereon from the date of such demand
to the date such payment is made at a rate per annum equal to the Federal Funds
Rate from time to time in effect.

 

10.07       Successors and Assigns.  (a)  The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that the Borrower may
not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender (other than as provided in
Section 7.03(h) and no Lender may assign or otherwise transfer any of its rights
or obligations hereunder except (i) to an Eligible Assignee in accordance with
the provisions of Section 10.07(b), (ii) by way of participation in accordance
with the provisions of Section 10.07(d), or (iii) by way of pledge or assignment
of a security interest subject to the restrictions of Section 10.07(f), or (iv)
to an SPC in accordance with the provisions of Section 10.07(h) (and any other
attempted assignment or transfer by any party hereto shall be null and void). 
Nothing in this Agreement, expressed or implied, shall be construed to confer
upon any Person (other than the parties hereto, their respective successors and
assigns permitted hereby, Participants to the extent provided in subsection (d)
of this Section and, to the extent expressly contemplated hereby, the
Indemnitees) any legal or equitable right, remedy or claim under or by reason of
this Agreement.

 

(B)           ANY LENDER MAY AT ANY TIME ASSIGN TO ONE OR MORE ELIGIBLE
ASSIGNEES ALL OR A PORTION OF ITS RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT
(INCLUDING ALL OR A PORTION OF ITS COMMITMENT AND THE LOANS (INCLUDING FOR
PURPOSES OF THIS SECTION 10.07(B), PARTICIPATIONS IN L/C OBLIGATIONS AND IN
SWING LINE LOANS) AT THE TIME OWING TO IT); PROVIDED THAT (I) EXCEPT IN THE CASE
OF AN ASSIGNMENT OF THE ENTIRE REMAINING AMOUNT OF THE ASSIGNING LENDER’S
COMMITMENT AND THE LOANS AT THE TIME OWING TO IT OR IN THE CASE OF AN ASSIGNMENT
TO A LENDER OR AN AFFILIATE OF A LENDER OR AN APPROVED FUND WITH RESPECT TO A
LENDER, THE AGGREGATE AMOUNT OF THE COMMITMENT

 

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(WHICH FOR THIS PURPOSE INCLUDES LOANS OUTSTANDING THEREUNDER) OR, IF THE
APPLICABLE COMMITMENT IS NOT THEN IN EFFECT, THE OUTSTANDING PRINCIPAL BALANCE
OF THE LOAN OF THE ASSIGNING LENDER SUBJECT TO EACH SUCH ASSIGNMENT, DETERMINED
AS OF THE DATE THE ASSIGNMENT AND ASSUMPTION WITH RESPECT TO SUCH ASSIGNMENT IS
DELIVERED TO THE ADMINISTRATIVE AGENT OR, IF “TRADE DATE” IS SPECIFIED IN THE
ASSIGNMENT AND ASSUMPTION, AS OF THE TRADE DATE, SHALL NOT BE LESS THAN
$2,500,000, IN THE CASE OF ANY ASSIGNMENT IN RESPECT OF THE REVOLVING CREDIT
FACILITY, OR $1,000,000 (OR THE DOLLAR EQUIVALENT THEREOF, IF APPLICABLE), IN
THE CASE OF ANY ASSIGNMENT IN RESPECT OF THE TERM FACILITY, UNLESS EACH OF THE
ADMINISTRATIVE AGENT AND, SO LONG AS NO EVENT OF DEFAULT UNDER SECTION 8.01(A)
OR 8.01(F) HAS OCCURRED AND IS CONTINUING, THE BORROWER OTHERWISE CONSENTS (EACH
SUCH CONSENT NOT TO BE UNREASONABLY WITHHELD OR DELAYED); (II) EACH PARTIAL
ASSIGNMENT SHALL BE MADE AS AN ASSIGNMENT OF A PROPORTIONATE PART OF ALL THE
ASSIGNING LENDER’S RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT WITH RESPECT TO
THE LOANS OR THE COMMITMENT ASSIGNED, EXCEPT THAT THIS CLAUSE (II) SHALL NOT (X)
APPLY TO RIGHTS IN RESPECT OF SWING LINE LOANS OR (Y) PROHIBIT ANY LENDER FROM
ASSIGNING ALL OR A PORTION OF ITS RIGHTS AND OBLIGATIONS AMONG SEPARATE
FACILITIES ON A NON-PRO RATA BASIS; (III) ANY ASSIGNMENT OF A REVOLVING CREDIT
COMMITMENT MUST BE APPROVED BY THE ADMINISTRATIVE AGENT, THE L/C ISSUER AND THE
SWING LINE LENDER UNLESS THE PERSON THAT IS THE PROPOSED ASSIGNEE IS ITSELF A
REVOLVING CREDIT LENDER (WHETHER OR NOT THE PROPOSED ASSIGNEE WOULD OTHERWISE
QUALIFY AS AN ELIGIBLE ASSIGNEE); (IV) THE PARTIES TO EACH ASSIGNMENT SHALL
EXECUTE AND DELIVER TO THE ADMINISTRATIVE AGENT AN ASSIGNMENT AND ASSUMPTION,
TOGETHER WITH A PROCESSING AND RECORDATION FEE OF $3,500; PROVIDED THAT (A) NO
SUCH FEE SHALL BE PAYABLE IN THE CASE OF AN ASSIGNMENT TO A LENDER, AN AFFILIATE
OF A LENDER OR AN APPROVED FUND WITH RESPECT TO A LENDER, AND (B) IN THE CASE OF
CONTEMPORANEOUS ASSIGNMENTS BY A LENDER TO ONE OR MORE FUNDS MANAGED BY THE SAME
INVESTMENT ADVISOR (WHICH FUNDS ARE NOT THEN LENDERS HEREUNDER), ONLY A SINGLE
SUCH $3,500 FEE SHALL BE PAYABLE FOR ALL SUCH CONTEMPORANEOUS ASSIGNMENTS; AND
(V) THE ASSIGNING LENDER SHALL DELIVER TO THE ADMINISTRATIVE AGENT OR THE
BORROWER ANY NOTE ISSUED TO IT MARKED “CANCELLED:”.  SUBJECT TO ACCEPTANCE AND
RECORDING THEREOF BY THE ADMINISTRATIVE AGENT PURSUANT TO SECTION 10.07(C), FROM
AND AFTER THE EFFECTIVE DATE SPECIFIED IN EACH ASSIGNMENT AND ASSUMPTION, THE
ELIGIBLE ASSIGNEE THEREUNDER SHALL BE A PARTY TO THIS AGREEMENT AND, TO THE
EXTENT OF THE INTEREST ASSIGNED BY SUCH ASSIGNMENT AND ASSUMPTION, HAVE THE
RIGHTS AND OBLIGATIONS OF A LENDER UNDER THIS AGREEMENT, AND THE ASSIGNING
LENDER THEREUNDER SHALL, TO THE EXTENT OF THE INTEREST ASSIGNED BY SUCH
ASSIGNMENT AND ASSUMPTION, BE RELEASED FROM ITS OBLIGATIONS UNDER THIS AGREEMENT
(AND, IN THE CASE OF AN ASSIGNMENT AND ASSUMPTION COVERING ALL OF THE ASSIGNING
LENDER’S RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT, SUCH LENDER SHALL CEASE TO
BE A PARTY HERETO BUT SHALL CONTINUE TO BE ENTITLED TO THE BENEFITS OF SECTIONS
3.01, 3.04, 3.05, 10.04 AND 10.05 WITH RESPECT TO FACTS AND CIRCUMSTANCES
OCCURRING PRIOR TO THE EFFECTIVE DATE OF SUCH ASSIGNMENT).  UPON REQUEST, THE
BORROWER (AT ITS EXPENSE) SHALL EXECUTE AND DELIVER A NOTE TO THE ASSIGNEE
LENDER.  ANY ASSIGNMENT OR TRANSFER BY A LENDER OF RIGHTS OR OBLIGATIONS UNDER
THIS AGREEMENT THAT DOES NOT COMPLY WITH THIS SUBSECTION SHALL BE TREATED FOR
PURPOSES OF THIS AGREEMENT AS A SALE BY SUCH LENDER OF A PARTICIPATION IN SUCH
RIGHTS AND OBLIGATIONS IN ACCORDANCE WITH SECTION 10.07(D).

 

(C)           THE ADMINISTRATIVE AGENT, ACTING SOLELY FOR THIS PURPOSE AS AN
AGENT OF THE BORROWER, SHALL MAINTAIN AT THE ADMINISTRATIVE AGENT’S OFFICE A
COPY OF EACH ASSIGNMENT AND ASSUMPTION DELIVERED TO IT AND A REGISTER FOR THE
RECORDATION OF THE NAMES AND ADDRESSES OF THE LENDERS, AND THE COMMITMENTS OF,
AND PRINCIPAL AMOUNTS (AND RELATED INTEREST AMOUNTS) OF THE LOANS, L/C
OBLIGATIONS (SPECIFYING THE UNREIMBURSED AMOUNT), L/C BORROWINGS AND AMOUNTS DUE
UNDER SECTION 2.03 OWING TO, EACH LENDER PURSUANT TO THE TERMS HEREOF FROM TIME
TO TIME (THE

 

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 “REGISTER”).  THE ENTRIES IN THE REGISTER SHALL BE CONCLUSIVE, AND THE
BORROWER, THE AGENTS AND THE LENDERS MAY TREAT EACH PERSON WHOSE NAME IS
RECORDED IN THE REGISTER PURSUANT TO THE TERMS HEREOF AS A LENDER HEREUNDER FOR
ALL PURPOSES OF THIS AGREEMENT, NOTWITHSTANDING NOTICE TO THE CONTRARY.  THE
REGISTER SHALL BE AVAILABLE FOR INSPECTION BY THE BORROWER AT ANY REASONABLE
TIME AND FROM TIME TO TIME UPON REASONABLE PRIOR NOTICE.  IN ADDITION, AT ANY
TIME THAT A REQUEST FOR A CONSENT FOR A MATERIAL OR OTHER SUBSTANTIVE CHANGE TO
THE LOAN DOCUMENTS IS PENDING, ANY LENDER MAY REQUEST AND RECEIVE FROM THE
ADMINISTRATIVE AGENT A COPY OF THE REGISTER.  UPON RECEIPT OF A DULY COMPLETED
AND EXECUTED ASSIGNMENT AND ASSUMPTION AND COMPLIANCE BY THE ASSIGNING LENDER
AND ELIGIBLE ASSIGNEE WITH THE OTHER APPLICABLE PROVISIONS OF THIS SECTION
10.07, THE ADMINISTRATIVE AGENT SHALL ACCEPT SUCH ASSIGNMENT AND ASSUMPTION AND
RECORD THE INFORMATION CONTAINED THEREIN IN THE REGISTER.

 

(D)           ANY LENDER MAY AT ANY TIME, WITHOUT THE CONSENT OF, OR NOTICE TO,
THE BORROWER OR THE ADMINISTRATIVE AGENT, SELL PARTICIPATIONS TO ANY PERSON
(OTHER THAN A NATURAL PERSON OR THE BORROWER OR ANY OF THE BORROWER’S AFFILIATES
OR SUBSIDIARIES) (EACH, A “PARTICIPANT”) IN ALL OR A PORTION OF SUCH LENDER’S
RIGHTS AND/OR OBLIGATIONS UNDER THIS AGREEMENT (INCLUDING ALL OR A PORTION OF
ITS COMMITMENT AND/OR THE LOANS (INCLUDING SUCH LENDER’S PARTICIPATIONS IN L/C
OBLIGATIONS AND/OR SWING LINE LOANS) OWING TO IT); PROVIDED THAT (I) SUCH
LENDER’S OBLIGATIONS UNDER THIS AGREEMENT SHALL REMAIN UNCHANGED, (II) SUCH
LENDER SHALL REMAIN SOLELY RESPONSIBLE TO THE OTHER PARTIES HERETO FOR THE
PERFORMANCE OF SUCH OBLIGATIONS AND (III) THE BORROWER, THE AGENTS AND THE OTHER
LENDERS SHALL CONTINUE TO DEAL SOLELY AND DIRECTLY WITH SUCH LENDER IN
CONNECTION WITH SUCH LENDER’S RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT.  ANY
AGREEMENT OR INSTRUMENT PURSUANT TO WHICH A LENDER SELLS SUCH A PARTICIPATION
SHALL PROVIDE THAT SUCH LENDER SHALL RETAIN THE SOLE RIGHT TO ENFORCE THIS
AGREEMENT AND TO APPROVE ANY AMENDMENT, MODIFICATION OR WAIVER OF ANY PROVISION
OF THIS AGREEMENT; PROVIDED THAT SUCH AGREEMENT OR INSTRUMENT MAY PROVIDE THAT
SUCH LENDER WILL NOT, WITHOUT THE CONSENT OF THE PARTICIPANT, AGREE TO ANY
AMENDMENT, WAIVER OR OTHER MODIFICATION DESCRIBED IN THE FIRST PROVISO TO
SECTION 10.01 THAT DIRECTLY AFFECTS SUCH PARTICIPANT.  SUBJECT TO SECTION
10.07(E), THE BORROWER AGREES THAT EACH PARTICIPANT SHALL BE ENTITLED TO THE
BENEFITS OF SECTIONS 3.01, 3.04 AND 3.05 TO THE SAME EXTENT AS IF IT WERE A
LENDER AND HAD ACQUIRED ITS INTEREST BY ASSIGNMENT PURSUANT TO SECTION
10.07(B).  TO THE EXTENT PERMITTED BY LAW, EACH PARTICIPANT ALSO SHALL BE
ENTITLED TO THE BENEFITS OF SECTION 10.09 AS THOUGH IT WERE A LENDER, PROVIDED
SUCH PARTICIPANT AGREES TO BE SUBJECT TO SECTION 2.13 AS THOUGH IT WERE A
LENDER.

 

(E)           A PARTICIPANT SHALL NOT BE ENTITLED TO RECEIVE ANY GREATER PAYMENT
UNDER SECTION 3.01, 3.04 OR 3.05 THAN THE APPLICABLE LENDER WOULD HAVE BEEN
ENTITLED TO RECEIVE WITH RESPECT TO THE PARTICIPATION SOLD TO SUCH PARTICIPANT,
UNLESS THE SALE OF THE PARTICIPATION TO SUCH PARTICIPANT IS MADE WITH THE
BORROWER’S PRIOR WRITTEN CONSENT AND SUCH PARTICIPANT COMPLIES WITH SECTION
10.15 AS IF SUCH PARTICIPANT WERE A LENDER UNDER SECTION 10.15.  A PARTICIPANT
THAT WOULD BE A FOREIGN LENDER IF IT WERE A LENDER SHALL NOT BE ENTITLED TO THE
BENEFITS OF SECTION 3.01 UNLESS THE BORROWER IS NOTIFIED OF THE PARTICIPATION
SOLD TO SUCH PARTICIPANT AND SUCH PARTICIPANT AGREES, FOR THE BENEFIT OF THE
BORROWER, TO COMPLY WITH SECTION 10.15 AS THOUGH IT WERE A LENDER.

 

(F)            ANY LENDER MAY AT ANY TIME PLEDGE OR ASSIGN A SECURITY INTEREST
IN ALL OR ANY PORTION OF ITS RIGHTS UNDER THIS AGREEMENT (INCLUDING UNDER ITS
NOTE, IF ANY) TO SECURE OBLIGATIONS OF SUCH LENDER, INCLUDING ANY PLEDGE OR
ASSIGNMENT TO SECURE OBLIGATIONS TO A FEDERAL RESERVE BANK; PROVIDED THAT NO
SUCH PLEDGE OR ASSIGNMENT SHALL RELEASE SUCH LENDER FROM ANY OF

 

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ITS OBLIGATIONS HEREUNDER OR SUBSTITUTE ANY SUCH PLEDGEE OR ASSIGNEE FOR SUCH
LENDER AS A PARTY HERETO.

 

(G)           AS USED HEREIN, THE FOLLOWING TERMS HAVE THE FOLLOWING MEANINGS:

 

“Eligible Assignee” means (a) a Lender; (b) an Affiliate of a Lender; (c) an
Approved Fund; and (d) any other Person (other than a natural person) approved
by (i) the Administrative Agent, (ii) in the case of any assignment of a
Revolving Commitment, the L/C Issuer and the Swing Line Lender, and (iii) (A)
unless an Event of Default under Section 8.01(a) or (f) has occurred and is
continuing or (B) in the case of any assignment to any Person that would result
in an increase in the amounts payable by the Borrower under Section 3.01(a), the
Borrower (each such approval under the foregoing clauses (i), (ii) and (iii)(A),
not to be unreasonably withheld or delayed; it being understood that if the
Administrative Agent does not provide either a negative or affirmative response
to an approval request within 10 days, such approval shall be deemed to have
been given); provided that notwithstanding the foregoing, “Eligible Assignee”
shall not include the Borrower or any of the Borrower’s Affiliates or
Subsidiaries.

 

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

 

“Approved Fund” means any Fund that is administered, advised or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers, advises or manages a Lender.  For the avoidance of
doubt, “Approved Fund” does not include any unaffiliated fund for which a Lender
is acting solely in a fronting capacity.

 

(H)           NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, ANY
LENDER (A “GRANTING LENDER”) MAY GRANT TO A SPECIAL PURPOSE FUNDING VEHICLE
IDENTIFIED AS SUCH IN WRITING FROM TIME TO TIME BY THE GRANTING LENDER TO THE
ADMINISTRATIVE AGENT AND THE BORROWER (AN “SPC”) THE OPTION TO PROVIDE ALL OR
ANY PART OF ANY LOAN THAT SUCH GRANTING LENDER WOULD OTHERWISE BE OBLIGATED TO
MAKE PURSUANT TO THIS AGREEMENT; PROVIDED THAT (I) NOTHING HEREIN SHALL
CONSTITUTE A COMMITMENT BY ANY SPC TO FUND ANY LOAN, AND (II) IF AN SPC ELECTS
NOT TO EXERCISE SUCH OPTION OR OTHERWISE FAILS TO MAKE ALL OR ANY PART OF SUCH
LOAN, THE GRANTING LENDER SHALL BE OBLIGATED TO MAKE SUCH LOAN PURSUANT TO THE
TERMS HEREOF OR, IF IT FAILS TO DO SO, TO MAKE SUCH PAYMENT TO THE
ADMINISTRATIVE AGENT AS IS REQUIRED UNDER SECTION 2.12(C)(II).  EACH PARTY
HERETO HEREBY AGREES THAT (I) NEITHER THE GRANT TO ANY SPC NOR THE EXERCISE BY
ANY SPC OF SUCH OPTION SHALL INCREASE THE COSTS OR EXPENSES OR OTHERWISE
INCREASE OR CHANGE THE OBLIGATIONS OF THE BORROWER UNDER THIS AGREEMENT
(INCLUDING ITS OBLIGATIONS UNDER SECTION 3.01 OR 3.04), (II) NO SPC SHALL BE
LIABLE FOR ANY INDEMNITY OR SIMILAR PAYMENT OBLIGATION UNDER THIS AGREEMENT FOR
WHICH A LENDER WOULD BE LIABLE, AND (III) THE GRANTING LENDER SHALL FOR ALL
PURPOSES, INCLUDING THE APPROVAL OF ANY AMENDMENT, WAIVER OR OTHER MODIFICATION
OF ANY PROVISION OF ANY LOAN DOCUMENT, REMAIN THE LENDER OF RECORD HEREUNDER. 
THE MAKING OF A LOAN BY AN SPC HEREUNDER SHALL UTILIZE THE COMMITMENT OF THE
GRANTING LENDER TO THE SAME EXTENT, AND AS IF, SUCH LOAN WERE MADE BY SUCH
GRANTING LENDER.  NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, ANY
SPC MAY (I) WITH NOTICE TO, BUT WITHOUT PRIOR CONSENT OF THE BORROWER AND THE

 

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ADMINISTRATIVE AGENT AND WITH THE PAYMENT OF A PROCESSING FEE OF $3,500, ASSIGN
ALL OR ANY PORTION OF ITS RIGHT TO RECEIVE PAYMENT WITH RESPECT TO ANY LOAN TO
THE GRANTING LENDER AND (II) DISCLOSE ON A CONFIDENTIAL BASIS ANY NON-PUBLIC
INFORMATION RELATING TO ITS FUNDING OF LOANS TO ANY RATING AGENCY, COMMERCIAL
PAPER DEALER OR PROVIDER OF ANY SURETY OR GUARANTEE OR CREDIT OR LIQUIDITY
ENHANCEMENT TO SUCH SPC.

 

(I)            NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, IF AT
ANY TIME BANK OF AMERICA ASSIGNS ALL OF ITS COMMITMENTS AND LOANS PURSUANT TO
SECTION 10.07(B), BANK OF AMERICA MAY, (I) UPON 30 DAYS’ NOTICE TO THE BORROWER
AND THE LENDERS, RESIGN AS L/C ISSUER AND/OR (II) UPON 30 DAYS’ NOTICE TO THE
BORROWER, RESIGN AS SWING LINE LENDER.  IN THE EVENT OF ANY SUCH RESIGNATION AS
L/C ISSUER OR SWING LINE LENDER, THE BORROWER SHALL BE ENTITLED TO APPOINT FROM
AMONG THE LENDERS A SUCCESSOR L/C ISSUER OR SWING LINE LENDER HEREUNDER;
PROVIDED, HOWEVER, THAT NO FAILURE BY THE BORROWER TO APPOINT ANY SUCH SUCCESSOR
SHALL AFFECT THE RESIGNATION OF BANK OF AMERICA AS L/C ISSUER OR SWING LINE
LENDER, AS THE CASE MAY BE.  IF BANK OF AMERICA RESIGNS AS L/C ISSUER, IT SHALL
RETAIN ALL THE RIGHTS AND OBLIGATIONS OF THE L/C ISSUER HEREUNDER WITH RESPECT
TO ALL LETTERS OF CREDIT OUTSTANDING AS OF THE EFFECTIVE DATE OF ITS RESIGNATION
AS L/C ISSUER AND ALL L/C OBLIGATIONS WITH RESPECT THERETO (INCLUDING THE RIGHT
TO REQUIRE THE LENDERS TO MAKE BASE RATE LOANS OR FUND RISK PARTICIPATIONS IN
UNREIMBURSED AMOUNTS PURSUANT TO SECTION 2.03(C)).  IF BANK OF AMERICA RESIGNS
AS SWING LINE LENDER, IT SHALL RETAIN ALL THE RIGHTS OF THE SWING LINE LENDER
PROVIDED FOR HEREUNDER WITH RESPECT TO SWING LINE LOANS MADE BY IT AND
OUTSTANDING AS OF THE EFFECTIVE DATE OF SUCH RESIGNATION, INCLUDING THE RIGHT TO
REQUIRE THE LENDERS TO MAKE BASE RATE LOANS OR FUND RISK PARTICIPATIONS IN
OUTSTANDING SWING LINE LOANS PURSUANT TO SECTION 2.04(C).

 

(J)            WITH RESPECT TO EACH LETTER OF CREDIT, IF AN L/C ISSUER TRANSFERS
ITS RIGHTS WITH RESPECT TO THE BORROWER’S OBLIGATION TO MAKE PAYMENTS TO SUCH
L/C ISSUER WITH RESPECT TO ANY UNREIMBURSED AMOUNTS OR L/C BORROWINGS, SUCH L/C
ISSUER SHALL GIVE NOTICE OF SUCH TRANSFER TO THE ADMINISTRATIVE AGENT FOR
NOTATION IN THE REGISTER AND NO SUCH TRANSFER WILL BE EFFECTIVE FOR PURPOSES OF
THIS AGREEMENT UNLESS IT HAS BEEN RECORDED IN THE REGISTER.

 

10.08       Confidentiality.  Each of the Agents and the Lenders agrees to
maintain the confidentiality of the Information, except that Information may be
disclosed (a) to its directors, officers, employees, agents, advisors and
representatives (it being understood that the Persons to whom such disclosure is
made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential); (b) to the extent requested
by any regulatory authority purporting to have jurisdiction over it; (c) to the
extent  required by applicable Laws or regulations or by any subpoena or similar
legal process; (d) to any other party to this Agreement; (e) subject to an
agreement containing provisions substantially the same as those of this Section
10.08, to any Eligible Assignee or pledgee (pursuant to Section 10.07(f)) of or
Participant in, or any prospective Eligible Assignee or pledgee (pursuant to
Section 10.07(f)) of or Participant in, any of its rights or obligations under
this Agreement; (f) with the consent of the Borrower; (g) to the extent such
Information becomes publicly available other than as a result of a breach of
this Section 10.08; (h) to any state, Federal or foreign authority or examiner
(including the National Association of Insurance Commissioners or any other
similar organization) regulating any Lender; or (i) to any rating agency when
required by it (it being understood that, prior to any such disclosure, such
rating agency shall undertake to preserve the confidentiality of any Information
relating to the Loan Parties received by it from such Lender).

 

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In addition, the Agents and the Lenders may disclose the existence of this
Agreement and information about this Agreement to market data collectors,
similar service providers to the lending industry, and service providers to the
Agents and the Lenders in connection with the administration and management of
this Agreement, the other Loan Documents, the Commitments, and the Credit
Extensions.  For the purposes of this Section, “Information” means all
information received from any Loan Party relating to any Loan Party or its
business, other than any such information that is publicly available to any
Agent or any Lender prior to disclosure by any Loan Party other than as a result
of a breach of this Section 10.08; provided that, in the case of information
received from a Loan Party after the date hereof, such information is clearly
identified at the time of delivery as confidential.  Any Person required to
maintain the confidentiality of Information as provided in this Section 10.08
shall be considered to have complied with its obligation to do so if such Person
has exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

 

10.09       Setoff.  In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence and during the continuance of any Event of
Default and the making of the request or the granting of the consent specified
by Section 8.01 to authorize the Administrative Agent to declare the Loans due
and payable pursuant to the provisions of Section 8.01, each Lender is
authorized at any time and from time to time, without prior notice to the
Borrower or any other Loan Party, any such notice being waived by the Borrower
(on its own behalf and on behalf of each Loan Party) to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by, and other
Indebtedness at any time owing by, such Lender to or for the credit or the
account of the respective Loan Parties against any and all Obligations owing to
such Lender hereunder or under any other Loan Document, now or hereafter
existing, irrespective of whether or not such Agent or such Lender shall have
made demand under this Agreement or any other Loan Document and although such
Obligations may be contingent or unmatured or denominated in a currency
different from that of the applicable deposit or Indebtedness.  Each Lender
agrees promptly to notify the Borrower and the Administrative Agent after any
such set-off and application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of such setoff and
application.  The rights of the Administrative Agent and each Lender under this
Section are in addition to other rights and remedies (including, without
limitation, other rights of setoff) that the Administrative Agent, such Lender
and their respective Affiliates may have.

 

10.10       Interest Rate Limitation.  Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not exceed the maximum rate of non-usurious interest
permitted by applicable Law (the “Maximum Rate”).  If any Agent or any Lender
shall receive interest in an amount that exceeds the Maximum Rate, the excess
interest shall be applied to the principal of the Loans or, if it exceeds such
unpaid principal, refunded to the Borrower.  In determining whether the interest
contracted for, charged, or received by an Agent or a Lender exceeds the Maximum
Rate, such Person may, to the extent permitted by applicable Law, (a)
characterize any payment that is not principal as an expense, fee, or premium
rather than interest, (b) exclude voluntary prepayments and the effects thereof,
and (c) amortize, prorate, allocate, and spread in equal or

 

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unequal parts the total amount of interest throughout the contemplated term of
the Obligations hereunder.

 

10.11       Counterparts.  This Agreement and each other Loan Document may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument. Delivery
by telecopier of an executed counterpart of a signature page to this Agreement
and each other Loan Document shall be effective as delivery of an original
executed counterpart of this Agreement and such other Loan Document. The Agents
may also require that any such documents and signatures delivered by telecopier
be confirmed by a manually-signed original thereof; provided that the failure to
request or deliver the same shall not limit the effectiveness of any document or
signature delivered by telecopier.

 

10.12       Integration.  This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and thereof and supersedes all prior agreements, written
or oral, on such subject matter.  In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control; provided that the inclusion of
supplemental rights or remedies in favor of the Agents or the Lenders in any
other Loan Document shall not be deemed a conflict with this Agreement.  Each
Loan Document was drafted with the joint participation of the respective parties
thereto and shall be construed neither against nor in favor of any party, but
rather in accordance with the fair meaning thereof.

 

10.13       Survival of Representations and Warranties.  All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof.  Such
representations and warranties have been or will be relied upon by each Agent
and each Lender, regardless of any investigation made by any Agent or any Lender
or on their behalf and notwithstanding that any Agent or any Lender may have had
notice or knowledge of any Default at the time of any Credit Extension, and
shall continue in full force and effect until the Termination Date.

 

10.14       Severability.  If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, the legality,
validity and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby.  The
invalidity of a provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

 

10.15       Tax Forms.  (a)  (i)  Each Lender and Agent that is not a “United
States person” within the meaning of Section 7701(a)(30) of the Code (a “Foreign
Lender”) shall deliver to the Borrower and the Administrative Agent, prior to
receipt of any payment subject to withholding under the Code (or upon accepting
an assignment of an interest herein), two duly signed, properly completed copies
of either IRS Form W-8BEN or any successor thereto (relating to such Foreign
Lender and entitling it to an exemption from, or reduction of, United States
withholding tax on all payments to be made to such Foreign Lender by the

 

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Borrower or any other Loan Party pursuant to this Agreement or any other Loan
Document) or IRS Form W-8ECI or any successor thereto (relating to all payments
to be made to such Foreign Lender by the Borrower or any other Loan Party
pursuant to this Agreement or any other Loan Document) or such other evidence
reasonably satisfactory to the Borrower and the Administrative Agent that such
Foreign Lender is entitled to an exemption from, or reduction of, United States
withholding tax, including any exemption pursuant to Section 881(c) of the Code,
and in the case of a Foreign Lender claiming such an exemption under Section
881(c) of the Code, a certificate that establishes in writing to the Borrower
and the Administrative Agent that such Foreign Lender is not (i) a “bank” as
defined in Section 881(c)(3)(A) of the Code, (ii) a 10-percent shareholder
within the meaning of Section 871(h)(3)(B) of the Code, and (iii) a controlled
foreign corporation related to the Borrower with the meaning of Section 864(d)
of the Code.  Thereafter and from time to time, each such Foreign Lender shall
(A) promptly submit to the Administrative Agent such additional duly completed
and signed copies of one or more of such forms or certificates (or such
successor forms or certificates as shall be adopted from time to time by the
relevant United States taxing authorities) as may then be available under then
current United States laws and regulations to avoid, or such evidence as is
reasonably satisfactory to the Borrower and the Administrative Agent of any
available exemption from, or reduction of, United States withholding taxes in
respect of all payments to be made to such Foreign Lender by the Borrower or any
other Loan Party pursuant to this Agreement or any other Loan Document, in each
case, (1) on or before the date that any such form, certificate or other
evidence expires or becomes obsolete, (2) after the occurrence of any event
requiring a change in the most recent form, certificate or evidence previously
delivered by it to the Borrower and the Administrative Agent and (3) from time
to time thereafter if reasonably requested by the Borrower or the Administrative
Agent, and (B) promptly notify the Borrower and the Administrative Agent of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction.

 

(ii)           Each Foreign Lender, to the extent it does not act or ceases to
act for its own account with respect to any portion of any sums paid or payable
to such Foreign Lender under any of the Loan Documents (for example, in the case
of a typical participation by such Foreign Lender), shall deliver to the
Borrower and the Administrative Agent on the date when such Foreign Lender
ceases to act for its own account with respect to any portion of any such sums
paid or payable, and at such other times as may be necessary in the
determination of the Borrower and the Administrative Agent (in either case, in
the reasonable exercise of its discretion), (A) two duly signed completed copies
of the forms or statements required to be provided by such Foreign Lender as set
forth above, to establish the portion of any such sums paid or payable with
respect to which such Foreign Lender acts for its own account that is not
subject to United States withholding tax, and (B) two duly signed completed
copies of IRS Form W-8IMY (or any successor thereto), together with any
information such Foreign Lender chooses to transmit with such form, and any
other certificate or statement of exemption required under the Code, to
establish that such Foreign Lender is not acting for its own account with
respect to a portion of any such sums payable to such Foreign Lender.

 

(iii)          The Borrower shall not be required to pay any additional amount
or any indemnity payment under Section 3.01 to (A) any Foreign Lender with
respect to any Taxes required to be deducted or withheld on the basis of the
information, certificates or statements of exemption such Lender transmits with
an IRS Form W-8IMY pursuant to this Section 10.15(a), (B) any Foreign Lender if
such Foreign Lender shall have failed

 

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to satisfy the foregoing provisions of this Section 10.15(a), or (C) any U.S.
Lender if such U.S. Lender shall have failed to satisfy the provisions of
Section 10.15(b); provided, that if such Lender shall have satisfied the
requirement of this Section 10.15(a) or Section 10.15(b), as the applicable, on
the date such Lender became a Lender or ceased to act for its own account with
respect to any payment under any of the Loan Documents, nothing in this Section
10.15(a) or Section 10.15(b) shall relieve the Borrower of its obligation to pay
any amounts pursuant to Section 3.01 in the event that, as a result of any
change in any applicable Law, treaty or governmental rule, regulation or order,
or any change in the interpretation, administration or application thereof, such
Lender is no longer properly entitled to deliver forms, certificates or other
evidence at a subsequent date establishing the fact that such Lender or other
Person for the account of which such Lender receives any sums payable under any
of the Loan Documents is not subject to withholding or is subject to withholding
at a reduced rate.

 

(iv)          The Administrative Agent may deduct and withhold any taxes
required by any Laws to be deducted and withheld from any payment under any of
the Loan Documents.

 

(B)           EACH LENDER AND AGENT THAT IS A “UNITED STATES PERSON” WITHIN THE
MEANING OF SECTION 7701(A)(30) OF THE CODE (EACH, A “U.S. LENDER”) SHALL DELIVER
TO THE ADMINISTRATIVE AGENT AND THE BORROWER TWO DULY SIGNED COMPLETED COPIES OF
IRS FORM W-9 ON OR PRIOR TO THE CLOSING DATE (OR ON OR PRIOR TO THE DATE IT
BECOMES A PARTY TO THIS AGREEMENT), CERTIFYING THAT SUCH U.S. LENDER IS ENTITLED
TO AN EXEMPTION FROM UNITED STATES BACKUP WITHHOLDING TAX, OR ANY SUCCESSOR
FORM.  IF SUCH U.S. LENDER FAILS TO DELIVER SUCH FORMS, THEN THE ADMINISTRATIVE
AGENT MAY WITHHOLD FROM ANY INTEREST PAYMENT TO SUCH U.S. LENDER AN AMOUNT
EQUIVALENT TO THE APPLICABLE BACK-UP WITHHOLDING TAX IMPOSED BY THE CODE,
WITHOUT REDUCTION.

 

(C)           IF ANY GOVERNMENTAL AUTHORITY ASSERTS THAT THE BORROWER OR THE
ADMINISTRATIVE AGENT DID NOT PROPERLY WITHHOLD OR BACKUP WITHHOLD, AS THE CASE
MAY BE, ANY TAX OR OTHER AMOUNT FROM PAYMENTS MADE TO OR FOR THE ACCOUNT OF ANY
FOREIGN LENDER OR U.S. LENDER, SUCH FOREIGN LENDER OR U.S. LENDER SHALL
INDEMNIFY THE BORROWER AND THE ADMINISTRATIVE AGENT THEREFOR, INCLUDING ALL
PENALTIES AND INTEREST, ANY TAXES IMPOSED BY ANY JURISDICTION ON THE AMOUNTS
PAYABLE TO THE BORROWER AND THE ADMINISTRATIVE AGENT UNDER THIS SECTION 10.15,
AND COSTS AND EXPENSES (INCLUDING ATTORNEY COSTS) OF THE BORROWER AND THE
ADMINISTRATIVE AGENT.  THE OBLIGATION OF THE FOREIGN LENDERS OR U.S. LENDERS,
SEVERALLY, UNDER THIS SECTION 10.15 SHALL SURVIVE THE TERMINATION OF THE
AGGREGATE COMMITMENTS, REPAYMENT OF ALL OTHER OBLIGATIONS HEREUNDER AND THE
RESIGNATION OF THE ADMINISTRATIVE AGENT.

 

10.16       Governing Law.  (a)  THIS AGREEMENT AND EACH OTHER LOAN DOCUMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.

 

(B)           ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK
SITTING IN NEW YORK CITY OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF
SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER, EACH
AGENT AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO
THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS.  THE BORROWER, EACH AGENT AND
EACH LENDER IRREVOCABLY WAIVES ANY

 

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OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN
DOCUMENT OR OTHER DOCUMENT RELATED THERETO.

 

10.17       Waiver of Right to Trial by Jury.  EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION 10.17 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT
OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

 

10.18       Binding Effect.  This Agreement shall become effective when it shall
have been executed by the Borrower and the Administrative Agent shall have been
notified by each Lender, Swing Line Lender and the L/C Issuer that each such
Lender, Swing Line Lender and the L/C Issuer has executed it and thereafter
shall be binding upon and inure to the benefit of the Borrower, each Agent and
each Lender and their respective successors and permitted assigns, except that
the Borrower shall not have the right (other than pursuant to Section 7.03(h))
to assign its rights hereunder or any interest herein without the prior written
consent of the Lenders.

 

10.19       USA PATRIOT Act Notice.  Each Lender and the Administrative Agent
(for itself and not on behalf of any Lender) hereby notifies the Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”), it is required to obtain,
verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will
allow such Lender or the Administrative Agent, as applicable, to identify the
Borrower in accordance with the Act.

 

10.20       Judgment Currency.  If, for the purposes of obtaining judgment in
any court, it is necessary to convert a sum due hereunder or any other Loan
Document in one currency into another currency, the rate of exchange used shall
be that at which in accordance with normal banking procedures the Administrative
Agent could purchase the first currency with such other currency on the Business
Day preceding that on which final judgment is given.  The obligation of the
Borrower in respect of any such sum due from it to the Administrative Agent or
the Lenders hereunder or under the other Loan Documents shall, notwithstanding
any judgment in a currency (the “Judgment Currency”) other than that in which
such sum is denominated in accordance with the applicable provisions of this
Agreement (the “Agreement Currency”), be discharged only to the extent that on
the Business Day following receipt by the Administrative

 

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Agent of any sum adjudged to be so due in the Judgment Currency, the
Administrative Agent may in accordance with normal banking procedures purchase
the Agreement Currency with the Judgment Currency.  If the amount of the
Agreement Currency so purchased is less than the sum originally due to the
Administrative Agent from the Borrower in the Agreement Currency, the Borrower
agrees, as a separate obligation and notwithstanding any such judgment, to
indemnify the Administrative Agent or the Person to whom such obligation was
owing against such loss.  If the amount of the Agreement Currency so purchased
is greater than the sum originally due to the Administrative Agent in such
currency, the Administrative Agent agrees to return the amount of any excess to
the Borrower (or to any other Person who may be entitled thereto under
applicable law).

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.

 

 

UNITED INDUSTRIES CORPORATION

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

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

 

 

BANK OF AMERICA, N.A., as
Administrative Agent

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

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

 

 

BANK OF AMERICA, N.A., as a Lender, L/C
Issuer and Swing Line Lender

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

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Agreed as of the date first above written:

 

 

 

 

 

 

 

 

[Please type or print name of Lender]

 

 

 

By

 

 

 

 

  Title:

 

 

 

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