Exhibit 10.1

 

(LOGO) [img001.jpg]

CREDIT AGREEMENT

dated as of

April 30, 2009

among

ESCALADE, INCORPORATED

The Lenders Party Hereto

and

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

 

 

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TABLE OF CONTENTS

 

 

 

 

ARTICLE I Definitions

 

1

SECTION 1.01.

Defined Terms.

 

1

SECTION 1.02.

Classification of Loans and Borrowings.

 

20

SECTION 1.03.

Terms Generally.

 

20

SECTION 1.04.

Accounting Terms; Agreement Accounting Principles.

 

20

ARTICLE II The Credits

 

20

SECTION 2.01.

Commitments.

 

20

SECTION 2.02.

Loans and Borrowings.

 

21

SECTION 2.03.

Requests for Borrowings.

 

21

SECTION 2.04.

Reserved.

 

22

SECTION 2.05.

Swingline Loans.

 

22

SECTION 2.06.

Letters of Credit.

 

23

SECTION 2.07.

Funding of Borrowings.

 

26

SECTION 2.08.

Interest Elections.

 

27

SECTION 2.09.

Termination of Commitments.

 

28

SECTION 2.10.

Repayment of Loans; Evidence of Debt.

 

28

SECTION 2.11.

Prepayment of Loans.

 

29

SECTION 2.12.

Fees.

 

31

SECTION 2.13.

Interest.

 

31

SECTION 2.14.

Alternate Rate of Interest.

 

32

SECTION 2.15.

Increased Costs.

 

32

SECTION 2.16.

Break Funding Payments.

 

33

SECTION 2.17.

Taxes.

 

34

SECTION 2.18.

Payments Generally; Allocation of Proceeds; Sharing of Set-offs.

 

35

SECTION 2.19.

Mitigation Obligations; Replacement of Lenders.

 

37

SECTION 2.20.

Returned Payments.

 

38

ARTICLE III Representations and Warranties

 

38

SECTION 3.01.

Organization; Powers.

 

38

SECTION 3.02.

Authorization; Enforceability.

 

38

SECTION 3.03.

Governmental Approvals; No Conflicts.

 

38

SECTION 3.04.

Financial Statements; No Material Adverse Change.

 

39

SECTION 3.05.

Properties.

 

39

SECTION 3.06.

Litigation and Environmental Matters.

 

39

SECTION 3.07.

Compliance with Laws and Agreements.

 

40

SECTION 3.08.

Investment Company Status.

 

40

SECTION 3.09.

Taxes.

 

40

SECTION 3.10.

ERISA.

 

40

SECTION 3.11.

Disclosure.

 

40

SECTION 3.12.

Material Agreements.

 

41

SECTION 3.13.

Solvency.

 

41

SECTION 3.14.

Insurance.

 

41

SECTION 3.15.

Capitalization and Subsidiaries.

 

41

SECTION 3.16.

Regulation U.

 

41

SECTION 3.17.

Employment Matters.

 

41

SECTION 3.18.

Affiliate Transactions.

 

42

ARTICLE IV Conditions

 

42

SECTION 4.01.

Effective Date.

 

42

SECTION 4.02.

Each Credit Event.

 

44

SECTION 4.03.

Post-Closing Conditions.

 

45

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ARTICLE V Affirmative Covenants

 

47

SECTION 5.01.

Financial Statements and Other Information.

 

47

SECTION 5.02.

Notices of Material Events.

 

48

SECTION 5.03.

Existence; Conduct of Business.

 

49

SECTION 5.04.

Payment of Obligations.

 

49

SECTION 5.05.

Maintenance of Properties.

 

49

SECTION 5.06.

Books and Records; Inspection Rights.

 

50

SECTION 5.07.

Compliance with Laws.

 

50

SECTION 5.08.

Use of Proceeds and Letters of Credit.

 

50

SECTION 5.09.

Insurance.

 

50

SECTION 5.10.

Casualty and Condemnation.

 

50

SECTION 5.11.

Appraisals.

 

51

SECTION 5.12.

Depository Banks.

 

51

SECTION 5.13.

Additional Collateral; Further Assurances

 

51

SECTION 5.14.

Hazardous Materials

 

51

SECTION 5.15.

Financial Covenants.

 

53

ARTICLE VI Negative Covenants

 

53

SECTION 6.01.

Indebtedness.

 

53

SECTION 6.02.

Liens.

 

54

SECTION 6.03.

Fundamental Changes.

 

55

SECTION 6.04.

Investments, Loans, Advances, Guarantees and Acquisitions.

 

56

SECTION 6.05.

Asset Sales.

 

57

SECTION 6.06.

Sale and Leaseback Transactions.

 

58

SECTION 6.07.

Swap Agreements.

 

58

SECTION 6.08.

Restricted Payments; Certain Payments of Indebtedness.

 

58

SECTION 6.09.

Transactions with Affiliates.

 

59

SECTION 6.10.

Restrictive Agreements.

 

59

SECTION 6.11.

Amendment of Material Documents.

 

59

SECTION 6.12.

Capital Expenditures.

 

59

SECTION 6.13.

Subsidiaries.

 

59

ARTICLE VII Events of Default

 

60

ARTICLE VIII The Administrative Agent

 

62

ARTICLE IX Miscellaneous

 

64

SECTION 9.01.

Notices.

 

64

SECTION 9.02.

Waivers; Amendments.

 

65

SECTION 9.03.

Expenses; Indemnity; Damage Waiver.

 

67

SECTION 9.04.

Successors and Assigns.

 

68

SECTION 9.05.

Survival.

 

71

SECTION 9.06.

Counterparts; Integration; Effectiveness.

 

71

SECTION 9.07.

Severability.

 

71

SECTION 9.08.

Right of Setoff.

 

72

SECTION 9.09.

Governing Law; Jurisdiction; Consent to Service of Process.

 

72

SECTION 9.10.

Waiver of Jury Trial.

 

72

SECTION 9.11.

Headings.

 

73

SECTION 9.12.

Confidentiality.

 

73

SECTION 9.13.

Several Obligations; Nonreliance; Violation of Law.

 

73

SECTION 9.14.

USA PATRIOT Act.

 

73

SECTION 9.15.

Disclosure.

 

73

SECTION 9.16.

Appointment for Perfection.

 

74

SECTION 9.17.

Interest Rate Limitation.

 

74

ARTICLE X Prior Credit Facilities

 

74

SECTION 10.01.

Waiver of Existing Defaults.

 

74

SECTION 10.02.

Amendment and Restatement of 2001 Credit Agreement and Indiana-Martin Credit
Agreement/Continuation of Principal Balance.

 

75

SECTION 10.03.

Termination of Commitments.

 

75

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SCHEDULES:

 

Commitment Schedule

Owned Property Schedule

Projected EBITDA Schedule

Schedule 3.05 -- Properties

Schedule 3.06 -- Disclosed Matters

Schedule 3.14 -- Insurance

Schedule 3.15 -- Capitalization and Subsidiaries

Schedule 3.18 -- Affiliate Transactions

Schedule 6.01 -- Existing Indebtedness

Schedule 6.02 -- Existing Liens

Schedule 6.04 -- Existing Investments

Schedule 6.10 -- Existing Restrictions

 

EXHIBITS:

 

Exhibit A -- Form of Assignment and Assumption

Exhibit B -- Form of Opinion of Borrower’s Counsel

Exhibit C -- Form of Compliance Certificate

Exhibit D -- Joinder Agreement

Exhibit E -- Form of Revolving USD Note

Exhibit F -- Form of Revolving Euro Note

Exhibit G -- Insurance Requirements

Exhibit H -- Martin Yale Letter of Credit

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          CREDIT AGREEMENT dated as of April 30, 2009 (as it may be amended or
modified from time to time, this “Agreement”), among ESCALADE, INCORPORATED, the
other Loan Parties hereto, the Lenders party hereto, and JPMORGAN CHASE BANK,
N.A., as Administrative Agent, Issuing Bank and a Lender.

          The parties hereto agree as follows:

ARTICLE I

Definitions

                    SECTION 1.01. Defined Terms. As used in this Agreement, the
following terms have the meanings specified below:

                    “ABR”, when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.

                    “Account” has the meaning assigned to such term in the
Security Agreement.

                    “Account Debtor” means any Person obligated on an Account.

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

                    “Adjusted LIBO Rate” means, with respect to any LIBOR
Borrowing for any Interest Period, an interest rate per annum (without any
rounding) equal to (a) the LIBO Rate for such Interest Period multiplied by
(b) the Statutory Reserve Rate.

                    “Administrative Agent” means Chase, in its capacity as
administrative agent for the Lenders hereunder, and with respect to Revolving
Euro Loans, includes Chase’s London Branch.

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

                    “Affiliate” means, with respect to a specified Person,
another Person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the Person
specified.

                    “Aggregate Availability” means, at any time of
determination, an amount equal to the Revolving Commitment at such time, minus
the Revolving Exposure of all Lenders at such time.

1

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                    “Agreement Accounting Principles” means generally accepted
accounting principles as in effect from time to time, applied in a manner
consistent with that used in preparing the consolidated financial statements of
the Borrower and its Subsidiaries delivered to the Administrative Agent and the
Lenders pursuant to Section 4.01(b).

                    “Alternate Base Rate” means, as of any date of
determination, the highest of (i) the Prime Rate as of such date, (ii) the
Federal Funds Effective Rate, as in effect on such date, plus 0.5% or (iii) the
Adjusted LIBO Rate for a one month Interest Period on such date (and if such
date is not a Business Day, the immediately preceding Business Day) plus 2.5%.
Any change in the Alternate Base Rate due to a change in the Prime Rate or the
Federal Funds Effective Rate shall be effective from and including the effective
date of such change in the Prime Rate or the Federal Funds Effective Rate,
respectively.

                    “Applicable Rate” means, for any day, with respect to any
ABR Revolving USD Loan, LIBOR Revolving USD Loan, ABR Revolving Euro Loan,
EURIBOR Revolving Euro Loan, Letter of Credit or Commitment Fee, as the case may
be, the applicable rate per annum set forth below:

 

 

 

Applicable Rate

LIBOR Loans

4.50%

EURIBOR Loans

4.50%

Letter of Credit

3.00%

ABR Loans

2.50%

Commitment Fee

0.50%

                    “Applicable Percentage” means, with respect to any Lender,
(a) with respect to Revolving USD Loans, Swingline Loans, Letters of Credit, LC
Disbursements and LC Exposure, a percentage equal to a fraction the numerator of
which is such Lender’s Revolving USD Commitment and the denominator of which is
the aggregate Revolving USD Commitment of all Revolving USD Lenders (if the
Revolving USD Commitments have terminated or expired, the Applicable Percentages
shall be determined based upon such Lender’s share of the aggregate Revolving
USD Exposure of all Lenders at that time), and (b) with respect to Revolving
Euro Loans, a percentage equal to a fraction the numerator of which is such
Lender’s Revolving Euro Commitment and the denominator of which is the aggregate
Revolving Euro Commitment of all Revolving Euro Lenders (if the Revolving Euro
Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon such Lender’s share of the aggregate Revolving Euro
Exposure of all Lenders at that time).

                    “Appraisal” means a written statement setting forth an
opinion of the market value of the real estate and all buildings, structures and
other improvements on the real estate that (i) has been independently and
impartially prepared by a qualified appraiser directly engaged by the
Administrative Agent or its agent, (ii) complies with all applicable federal and
state laws and regulations dealing with appraisals or valuations of real
property, and (iii) has been reviewed as to form and content and approved by the
Administrative Agent, in its reasonable judgment.

                    “Approved Fund” has the meaning assigned to such term in
Section 9.04.

                    “Approved LC Amount” means the maximum amount of LC Exposure
that may be outstanding at any time as approved from time to time in writing by
the Required Lenders. As of the Effective Date, the Approved LC Amount is
$3,500,000.00 minus the aggregate undrawn amount of the Martin Yale Letter of
Credit on any date of determination.

                    “Assignment and Assumption” means an assignment and
assumption entered into by a Lender and an assignee (with the consent of any
party whose consent is required by Section 9.04), and accepted by the
Administrative Agent, in the form of Exhibit A or any other form approved by the
Administrative Agent.

2

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                    “Banking Services” means each and any of the following bank
services provided to any Loan Party by Chase or any of its Affiliates: (a)
credit cards for commercial customers (including, without limitation,
“commercial credit cards” and purchasing cards), (b) stored value cards and (c)
treasury management services (including, without limitation, controlled
disbursement, automated clearinghouse transactions, return items, overdrafts and
interstate depository network services).

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

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

                    “Borrower” means Escalade, Incorporated, an Indiana
corporation.

                    “Borrowing” means (a) Revolving Loans of the same Type,
made, converted or continued on the same date and, in the case of LIBOR
Revolving Loans and EURIBOR Revolving Loans, as to which a single Interest
Period is in effect, or (b) a Swingline Loan.

                    “Borrowing Request” means a request by the Borrower for a
Revolving Borrowing in accordance with Section 2.03.

                    “Business Day” means any day that is not a Saturday, Sunday
or other day on which commercial banks in New York City are authorized or
required by law to remain closed; provided that, when used in connection with a
LIBOR Loan, the term “Business Day” shall also exclude any day on which banks
are not open for dealings in dollar deposits in the London interbank market and
that, when used in connection with a EURIBOR Loan, the term “Business Day” shall
also exclude any day on which the Trans European Real-Time Gross Settlement
Express Transfer System is not open for settlement of payments in Euros.

                    “Capital Expenditures” means, without duplication, any
expenditure or commitment to expend money for any purchase or other acquisition
of any asset which would be classified as a fixed or capital asset on a
consolidated balance sheet of the Loan Parties prepared in accordance with
Agreement Accounting Principles.

                    “Capital Lease Obligations” of any Person means the
obligations of such Person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under
Agreement Accounting Principles, and the amount of such obligations shall be the
capitalized amount thereof determined in accordance with Agreement Accounting
Principles.

3

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                    “Change in Control” means (a) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person or group
(within the meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder as in effect on the date hereof)
other than Robert Griffin, of Equity Interests representing more than 50% of the
aggregate ordinary voting power represented by the issued and outstanding Equity
Interests of the Borrower; (b) occupation of a majority of the seats (other than
vacant seats) on the board of directors of the Borrower by Persons who were
neither (i) nominated by the board of directors of the Borrower nor (ii)
appointed by directors so nominated; or (c) the acquisition of direct or
indirect Control of the Borrower by any Person or group other than Robert
Griffin; or (d) the Borrower shall cease to own, free and clear of all Liens or
other encumbrances, 100% of the outstanding voting Equity Interests of each of
Martin Yale Industries, Inc. and Indian Industries, Inc. on a fully diluted
basis.

                    “Change in Law” means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender or
the Issuing Bank (or, for purposes of Section 2.15(b)), by any lending office of
such Lender or by such Lender’s or the Issuing Bank’s holding company, if any)
with any request, guideline or directive (whether or not having the force of
law) of any Governmental Authority made or issued after the date of this
Agreement.

                    “Chase” means JPMorgan Chase Bank, N.A., a national banking
association, in its individual capacity, and its successors.

                    “Chase’s London Branch” means the London, England branch of
Chase.

                    “Chase’s London Branch Obligations” means, collectively, all
unpaid principal of and accrued and unpaid interest on the loans made to the
Borrower by Chase’s London Branch (including, the 1 million Euro overdraft
facility made available to the Borrower by Chase), all accrued and unpaid fees
and all expenses, reimbursements, indemnities and other obligations of the
Borrower with respect to loans, credit facilities or Banking Services provided
by Chase’s London Branch.

                    “Class”, when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
Revolving Loans or Swingline Loans.

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

                    “Collateral” means any and all property owned, leased or
operated by a Person covered by the Collateral Documents and any and all other
property of any Loan Party, now existing or hereafter acquired, that may at any
time be or become subject to a security interest or Lien in favor of the
Administrative Agent, on behalf of itself and the Lenders, to secure all or any
portion of the Secured Obligations.

                    “Collateral Access Agreement” has the meaning assigned to
such term in the Security Agreement.

                    “Collateral Documents” means, collectively, the Security
Agreement, the Mortgages and any other documents granting a Lien upon the
Collateral as security for payment of all or any portion of the Secured
Obligations.

                    “Commitment” means, with respect to each Lender, the sum of
such Lender’s Revolving Commitment, as such Commitment may be reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.04. The initial amount of each Lender’s Commitment is set
forth on the Commitment Schedule, or in the Assignment and Assumption pursuant
to which such Lender shall have assumed its Commitment, as applicable.

                    “Commitment Schedule” means the Schedule attached hereto
identified as such.

4

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                    “Consolidated EBITDA” means with respect to any period,
Consolidated Net Income plus, to the extent deducted from revenues in
determining Consolidated Net Income, (i) Consolidated Interest Expense, (ii)
expense for income taxes paid or accrued, (iii) depreciation, (iv) amortization,
(v) extraordinary losses incurred other than in the ordinary course of business,
and any other non-cash expenses incurred in the ordinary course of business, and
(vi) minus, to the extent included in determining Consolidated Net Income, all
extraordinary gains realized other than in the ordinary course of business, and
all other non-cash income from all sources, whether realized in the ordinary
course of business or other than in the ordinary course of business, all
calculated for the Borrower and its Subsidiaries on a consolidated basis in
accordance with Agreement Accounting Principles.

                    “Consolidated Interest Expense” means, with reference to any
period, the interest expense of the Borrower and its Subsidiaries calculated on
a consolidated basis for such period in accordance with Agreement Accounting
Principles.

                    “Consolidated Net Income” means, with reference to any
period, the net income (or loss) of the Borrower and its Subsidiaries calculated
on a consolidated basis for such period in accordance with Agreement Accounting
Principles.

                    “Consolidated Tangible Net Worth” means the consolidated
members’ equity of the Borrower and its subsidiaries, less any allowance for
goodwill, patents, trademarks, trade secrets, and any other assets which would
be classified as intangible assets under Agreement Accounting Principles, less
the deferred tax asset arising from the recognition of net operating loss carry
forward, and less the portion of “other comprehensive income” (determined in
accordance with Agreement Accounting Principles and being either a positive or
negative amount), which relates to interest rate swaps and minimum pension
liabilities and which directly affects the equity section of the Borrower’s
balance sheet without being reflected in the income statement, all determined on
a consolidated basis for the Borrower and its Subsidiaries in accordance with
Agreement Accounting Principles.

                    “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.

                    “Credit Exposure” means, as to any Lender at any time, such
Lender’s Revolving Exposure at such time.

                    “Default” means any event or condition which constitutes an
Event of Default or which upon notice, lapse of time or both would, unless cured
or waived, become an Event of Default.

                    “Disclosed Matters” means the actions, suits and proceedings
and the environmental matters disclosed in Schedule 3.06.

                    “Document” has the meaning assigned to such term in the
Security Agreement.

                    “dollars” or “$” refers to lawful money of the United States
of America.

5

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                    “EBITDA Test Period” means each of the periods set forth in
the table below. When used in this Agreement, a numerical reference to a
specific EBITDA Test Period (for instance, “EBITDA Test Period 1”), means the
EBITDA Test Period that corresponds to such numerical reference under the
heading “EBITDA Test Period” in the table below.

 

 

 

 

 

EBITDA Test Period

 

EBITDA Test Period Begins

 

EBITDA Test Period ends

         

EBITDA Test Period 1

 

December 27, 2008

 

January 24, 2009

EBITDA Test Period 2

 

December 27, 2008

 

February 21, 2009

EBITDA Test Period 3

 

December 27, 2008

 

March 21, 2009

EBITDA Test Period 4

 

December 27, 2008

 

April 18, 2009

EBITDA Test Period 5

 

December 27, 2008

 

May 16, 2009

EBITDA Test Period 6

 

December 27, 2008

 

June 13, 2009

EBITDA Test Period 7

 

December 27, 2008

 

July 11, 2009

EBITDA Test Period 8

 

December 27, 2008

 

August 8, 2009

EBITDA Test Period 9

 

December 27, 2008

 

September 5, 2009

EBITDA Test Period 10

 

December 27, 2008

 

October 3, 2009

EBITDA Test Period 11

 

December 27, 2008

 

October 31, 2009

EBITDA Test Period 12

 

December 27, 2008

 

November 28, 2009

EBITDA Test Period 13

 

December 27, 2008

 

December 26, 2009

EBITDA Test Period 14

 

December 27, 2008

 

January 23, 2010

EBITDA Test Period 15

 

December 27, 2008

 

February 20, 2010

EBITDA Test Period 16

 

December 27, 2008

 

March 20, 2010

EBITDA Test Period 17

 

December 27, 2008

 

April 17, 2010

EBITDA Test Period 18

 

December 27, 2008

 

May 15, 2010

                    “Effective Date” means the date on which the conditions
specified in Section 4.01 are satisfied (or waived in accordance with
Section 9.02).

                    “EMU Legislation” means legislative measures of the Council
of the European Union for the introduction of, changeover to, or operation of, a
single or unified European currency being part of the implementation of the
Third Stage of Economic and Monetary Union as contemplated by the Treaty on
European Union.

                    “Environmental Laws” means all laws, rules, regulations,
codes, ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.

                    “Environmental Liability” means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary
directly or indirectly resulting from or based upon (a) 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.

6

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                    “Equipment” has the meaning assigned to such term in the
Security Agreement.

                    “Equity Interests” means shares of capital stock,
partnership interests, membership interests in a limited liability company,
beneficial interests in a trust or other equity ownership interests in a Person,
and any warrants, options or other rights entitling the holder thereof to
purchase or acquire any such equity interest.

                    “ERISA” means the Employee Retirement Income Security Act of
1974, as amended from time to time.

                    “ERISA Affiliate” means any trade or business (whether or
not incorporated) that, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.

                    “ERISA Event” means (a) any “reportable event”, as defined
in Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b) the
existence with respect to any Plan of an “accumulated funding deficiency” (as
defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate
from the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f)
the incurrence by the Borrower or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.

                    “Escalade Insurance” means Escalade Insurance, Inc., a
Nevada corporation.

                    “EURIBOR” when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the EURIBOR Rate.

                    “EURIBOR Rate” means, in relation to any amount to be
advanced to, or owing by, the Borrower hereunder in Euro on which interest for a
given period is to accrue, the percentage rate per annum equal to the offering
quotation which appears on Reuters Screen EURIBOR01 Page which displays an
average rate of the Banking Federation of the European Union for the Euro for
such period at or about 11.00 am (Brussels time) on the Quotation Date for such
period or, if such page or such service shall cease to be available, such other
page or such other service for the purpose of displaying an average rate of the
Banking Federation of the European Union as the Administrative Agent shall
select.

                    “Euro” means the single lawful currency as of the Effective
Date of the Participating Member States.

                    “European Interbank Market” means the interbank market for
Euros operating in the Participating Member States.

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

                    “Excluded Taxes” means, with respect to the Administrative
Agent, any Lender, the Issuing Bank or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.19(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement (or designates a new lending office) or is attributable to
such Foreign Lender’s failure to comply with Section 2.16(e), except to the
extent that such Foreign Lender (or its assignor, if any) was entitled, at the
time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.17(a).

                    “Federal Funds Effective Rate” means, for any day, the
weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for
such day for such transactions received by the Administrative Agent from three
Federal funds brokers of recognized standing selected by it.

                    “Financial Officer” means for any Person the chief financial
officer, principal accounting officer, treasurer or controller of such Person.

                    “Fiscal Month” means, with respect to the Borrower and its
Subsidiaries, one of the 13 fiscal accounting periods in each Fiscal Year of the
Borrower and its Subsidiaries.

                    “Fiscal Quarter” means, with respect to the Borrower and its
Subsidiaries, (a) during a Fiscal Year consisting of 52 weeks, one of the four
fiscal accounting periods in such Fiscal Year of the Borrower and its
Subsidiaries with the first, third and fourth Fiscal Quarter consisting of 12
weeks and the second Fiscal Quarter consisting of 16 weeks, and (b) during a
Fiscal Year consisting of 53 weeks, one of the four fiscal accounting periods in
such Fiscal Year of the Borrower and its Subsidiaries with the first and third
Fiscal Quarter consisting of 12 weeks, the second Fiscal Quarter consisting of
16 weeks, and the fourth Fiscal Quarter consisting of 13 weeks.

                    “Fiscal Year” means, with respect to the Borrower and its
Subsidiaries, a 52-53 week tax year ending on the last Saturday of December each
year.

                    “Foreign Lender” means any Lender that is organized under
the laws of a jurisdiction other than that in which the Borrower is located. For
purposes of this definition, the United States of America, each State thereof
and the District of Columbia shall be deemed to constitute a single
jurisdiction.

                    “Funding Account” has the meaning assigned to such term in
Section 4.01(h).

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

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                    “Guarantee” of or by any Person (the “guarantor”) means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the “primary obligor”) in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof,
(c) to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided, that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.

                    “Hazardous Materials” means all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.

                    “Indebtedness” of any Person means, without duplication,
(a) all obligations of such Person for borrowed money or with respect to
deposits or advances of any kind, (b) all obligations of such Person evidenced
by bonds, debentures, notes or similar instruments, (c) all obligations of such
Person upon which interest charges are customarily paid, (d) all obligations of
such Person under conditional sale or other title retention agreements relating
to property acquired by such Person, (e) all obligations of such Person in
respect of the deferred purchase price of property or services (excluding
current accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed, (g) all Guarantees by such Person of
Indebtedness of others, (h) all Capital Lease Obligations of such Person,
(i) all obligations, contingent or otherwise, of such Person as an account party
in respect of letters of credit and letters of guaranty, (j) all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances, (k)
obligations under any liquidated earn-out and (l) any other Off-Balance Sheet
Liability. The Indebtedness of any Person shall include the Indebtedness of any
other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person’s ownership interest in or other relationship with such entity, except to
the extent the terms of such Indebtedness provide that such Person is not liable
therefor.

                    “Indemnified Taxes” means Taxes other than Excluded Taxes.

                    “Instrument” has the meaning assigned to such term in the
Security Agreement.

                    “Intangibles” means, as of any date of determination, all of
the intangible assets of a Person including, without limitation, (a) any surplus
resulting from any write-up of assets subsequent to the date of this Agreement;
(b) deferred assets, other than prepaid insurance and prepaid taxes; (c)
intellectual property rights, non-compete agreements, franchises and other
similar intangibles; (d) goodwill, including any amounts, however designated on
a balance sheet, representing the excess of the purchase price paid for assets
or stock over the value assigned thereto on the books of such Person; (e)
investments in Affiliates; (f) unamortized debt discount and expense; and (g)
Accounts, notes and other receivables due from Affiliates or employees, all as
determined for the Loan Parties on a consolidated basis for such period.

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                    “Interest Election Request” means a request by the Borrower
to convert or continue a Borrowing in accordance with Section 2.08.

                    “Interest Payment Date” means (a) with respect to an ABR
Revolving USD Loan, the last day of each calendar month and the Revolving USD
Loan Maturity Date, (b) with respect to an ABR Revolving Euro Loan, the last day
of each calendar month and the Revolving Euro Loan Maturity Date, (c) with
respect to any LIBOR Loan, the last day of the Interest Period applicable to the
Borrowing of which such Loan is a part and, in the case of a LIBOR Loan with an
Interest Period of more than three months’ duration, each day prior to the last
day of such Interest Period that occurs at intervals of three months’ duration
after the first day of such Interest Period and the Maturity Date applicable to
such Loan, and (d) with respect to any EURIBOR Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part and, in
the case of a EURIBOR Loan with an Interest Period of more than three months’
duration, each day prior to the last day of such Interest Period that occurs at
intervals of three months’ duration after the first day of such Interest Period
and the Maturity Date applicable to such Loan.

                    “Interest Period” means, with respect to a LIBOR Borrowing
or EURIBOR Borrowing, a period of one, two, three, four or six months commencing
on a Business Day selected by the Borrower pursuant to this Agreement. The
Interest Period shall end on that day which corresponds numerically to such
dates one, two, three, four or six months thereafter, provided, however, that if
there is no such numerically corresponding day in such next, second, third,
fourth or sixth succeeding month, such Interest Period shall end on the last
Business Day of such next, second, third, fourth, or sixth succeeding month. If
an Interest Period would otherwise end on a day which is not a Business Day,
such Interest Period shall end on the next succeeding Business Day, provided,
however, that if said next succeeding Business Day falls in a new Fiscal Month,
such Interest Period shall end on the immediately preceding Business Day.

                    “Inventory” has the meaning assigned to such term in the
Security Agreement.

                    “Issuing Bank” means Chase, in its capacity as the issuer of
Letters of Credit hereunder, and its successors in such capacity as provided in
Section 2.06 (i). The Issuing Bank may, in its discretion, arrange for one or
more Letters of Credit to be issued by Affiliates of the Issuing Bank, in which
case the term “Issuing Bank” shall include any such Affiliate with respect to
Letters of Credit issued by such Affiliate.

                    “Joinder Agreement” has the meaning assigned to such term in
Section 5.13.

                    “LC Collateral Account” has the meaning assigned to such
term in Section 2.06(j).

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

                    “LC Exposure” means, at any time, the sum of (a) the
aggregate undrawn amount of all outstanding Letters of Credit at such time plus
(b) the aggregate amount of all LC Disbursements that have not yet been
reimbursed at such time. The LC Exposure of any Revolving USD Lender at any time
shall be its Applicable Percentage of the total LC Exposure at such time.

                    “Lenders” means the Persons listed on the Commitment
Schedule and any other Person that shall have become a party hereto pursuant to
an Assignment and Assumption, other than any such Person that ceases to be a
party hereto pursuant to an Assignment and Assumption. Unless the context
otherwise requires, the term “Lenders” includes the Swingline Lender.

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                    “Letter of Credit” means a letter of credit issued pursuant
to Section 2.06 of this Agreement.

                    “LIBO Rate” means, with respect to any LIBOR Borrowing for
any Interest Period, the rate appearing on Reuters Screen LIBOR01 Page (or on
any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two (2) Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the “LIBO Rate” with respect to such
LIBOR Borrowing for such Interest Period shall be the rate at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two (2) Business Days prior to the commencement of such
Interest Period.

                    “LIBOR” when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.

                    “Lien” means, with respect to any asset, (a) any mortgage,
deed of trust, lien, pledge, hypothecation, encumbrance, charge or security
interest in, on or of such asset, (b) the interest of a vendor or a lessor under
any conditional sale agreement, capital lease or title retention agreement (or
any financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.

                    “Loan Documents” means this Agreement, Revolving USD Notes,
Revolving Euro Notes and any other promissory notes issued pursuant to the
Agreement, any Letter of Credit applications, the Collateral Documents, the Loan
Guaranty, the Martin Yale Letter of Credit Documents and all other agreements,
instruments, documents and certificates identified in Section 4.01 executed and
delivered to, or in favor of, the Administrative Agent or any Lenders and
including all other pledges, powers of attorney, consents, assignments,
contracts, notices, letter of credit agreements and all other written matter
whether heretofore, now or hereafter executed by or on behalf of any Loan Party,
or any employee of any Loan Party, and delivered to the Administrative Agent or
any Lender in connection with the Agreement or the transactions contemplated
thereby. Any reference in the Agreement or any other Loan Document to a Loan
Document shall include all appendices, exhibits or schedules thereto, and all
amendments, restatements, supplements or other modifications thereto, and shall
refer to the Agreement or such Loan Document as the same may be in effect at any
and all times such reference becomes operative.

                    “Loan Guarantor” means each of Borrower’s Subsidiaries
organized under the laws of a jurisdiction of the United States.

                    “Loan Guaranty” means each Guarantee, in form and substance
satisfactory to the Administrative Agent, delivered by each Loan Guarantor, as
it may be amended or modified and in effect from time to time.

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                    “Loan Parties” means, collectively, the Borrower, each of
the Borrower’s domestic Subsidiaries and any other Person who becomes a party to
this Agreement pursuant to a Joinder Agreement and their respective successors
and assigns.

                    “Loans” means the loans and advances made by the Lenders
pursuant to this Agreement, including Swingline Loans.

                    “Martin Yale Letter of Credit” means letter of credit no.
00330811 issued to The Bank of New York Trust Company, N.A. for the account of
Martin Yale Industries, Inc. in the face amount of $2,733,750 with a June 30,
2010 expiry date, as amended, which letter of credit is and attached hereto as
Exhibit H.

                    “Martin Yale Letter of Credit Documents” means the Martin
Yale Letter of Credit and all other agreements, instruments, guaranties,
documents and certificates executed and delivered to, or in favor of, the
Administrative Agent or any Lenders and including all pledges, powers of
attorney, consents, assignments, contracts, notices, letter of credit agreements
and all other written matter whether heretofore, now or hereafter executed by or
on behalf of any Loan Party, or any employee of any Loan Party, and delivered to
the Administrative Agent or any Lender in connection with the Martin Yale Letter
of Credit or the transactions contemplated thereby.

                    “Material Adverse Effect” means a material adverse effect on
(a) the business, assets, operations, prospects or condition, financial or
otherwise, of the Borrower and/or its respective Subsidiaries taken as a whole,
(b) the ability of any Loan Party to perform any of its obligations under the
Loan Documents to which it is a party, (c) the Collateral, or the Administrative
Agent’s Liens (on behalf of itself and the Lenders) on the Collateral or the
priority of such Liens, or (d) the rights of or benefits available to the
Administrative Agent, the Issuing Bank or the Lenders thereunder.

                    “Material Indebtedness” means Indebtedness (other than the
Loans and Letters of Credit and Indebtedness owing from one Loan Party to
another Loan Party), or obligations in respect of one or more Swap Agreements,
of any one or more of the Borrower or its Subsidiaries in an aggregate principal
amount exceeding $500,000. For purposes of determining Material Indebtedness,
the “obligations” of the Borrower or any Subsidiary in respect of any Swap
Agreement at any time shall be the maximum aggregate amount (giving effect to
any netting agreements) that the Borrower or such Subsidiary would be required
to pay if such Swap Agreement were terminated at such time.

                    “Maturity Date” means with respect to a Revolving USD Loan,
the Revolving USD Loan Maturity Date and with respect to a Revolving Euro Loan,
the Revolving Euro Loan Maturity Date.

                    “Maximum Liability” has the meaning assigned to such term in
Section 10.10.

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

                    “Mortgage” means any mortgage, deed of trust or other
agreement which conveys or evidences a Lien in favor of the Administrative
Agent, for the benefit of the Administrative Agent and the Lenders, on real
property of a Loan Party, including any amendment, modification or supplement
thereto.

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

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                    “Net Proceeds” means, with respect to any Prepayment Event,
(a) the cash proceeds received in respect of such event including (i) any cash
received in respect of any non-cash proceeds (including any cash payments
received by way of deferred payment of principal pursuant to a note or
installment receivable or purchase price adjustment receivable or otherwise, but
excluding any interest payments), but only as and when received, (ii) in the
case of a casualty, insurance proceeds and (iii) in the case of a condemnation
or similar event, condemnation awards and similar payments, net of (b) the sum
of (i) all reasonable fees and out-of-pocket expenses paid to third parties
(other than Affiliates) in connection with such event, (ii) in the case of a
sale, transfer or other disposition of an asset (including pursuant to a sale
and leaseback transaction or a casualty or a condemnation or similar
proceeding), the amount of all payments required to be made as a result of such
event to repay Indebtedness (other than Loans) secured by such asset or
otherwise subject to mandatory prepayment as a result of such event and
(iii) the amount of all taxes paid (or reasonably estimated to be payable) and
the amount of any reserves established to fund contingent liabilities reasonably
estimated to be payable, in each case during the year that such event occurred
or the next succeeding year and that are directly attributable to such event (as
determined reasonably and in good faith by a Financial Officer).

                    “Non-Consenting Lender” has the meaning assigned to such
term in Section 9.02(d).

                    “Obligations” means, collectively, all unpaid principal of
and accrued and unpaid interest on the Loans made to the Borrower (including,
without limitation, all Revolving Exposure of all Lenders and accrued interest
thereon), all LC Exposure, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations of the Borrower to the Lenders
or to any Lender, the Administrative Agent, the Swingline Lender, the Issuing
Bank or any indemnified party arising under the Loan Documents.

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

                    “Other Taxes” means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement.

                    “Owned Property” means the real estate, improvements and
related assets at the locations described on the Owned Property Schedule
attached hereto.

                    “Participant” has the meaning set forth in Section 9.04.

                    “Participating Member State” means a state so described in
any EMU Legislation.

                    “PBGC” means the Pension Benefit Guaranty Corporation
referred to and defined in ERISA and any successor entity performing similar
functions.

                    “Permitted Discretion” means a determination made in good
faith and in the exercise of reasonable (from the perspective of a secured
lender) business judgment.

                    “Permitted Encumbrances” means:

          (a) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 5.04;

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          (b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s
and other like Liens imposed by law, arising in the ordinary course of business
and securing obligations that are not overdue by more than 30 days or are being
contested in compliance with Section 5.04;

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

          (d) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature, in each case in the ordinary course of
business;

          (e) judgment liens in respect of judgments that do not constitute an
Event of Default under clause (k) of Article VII; and

          (f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary
conduct of business of the Borrower or any Subsidiary; provided that the term
“Permitted Encumbrances” shall not include any Lien securing Indebtedness.

                    “Permitted Investments” means:

          (a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America), in each case
maturing within one year from the date of acquisition thereof;

          (b) investments in commercial paper maturing within 270 days from the
date of acquisition thereof and having, at such date of acquisition, the highest
credit rating obtainable from S&P or from Moody’s;

          (c) investments in certificates of deposit, banker’s acceptances and
time deposits maturing within 180 days from the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit accounts issued
or offered by, any domestic office of any commercial bank organized under the
laws of the United States of America or any State thereof which has a combined
capital and surplus and undivided profits of not less than $500,000,000;

          (d) fully collateralized repurchase agreements with a term of not more
than 30 days for securities described in clause (a) above and entered into with
a financial institution satisfying the criteria described in clause (c) above;
and

          (e) money market funds that (i) comply with the criteria set forth in
Securities and Exchange Commission Rule 2a-7 under the Investment Company Act of
1940, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio
assets of at least $5,000,000,000.

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

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                    “Plan” means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or
Section 412 of the Code or Section 302 of ERISA, and in respect of which the
Borrower or any ERISA Affiliate is (or, if such plan were terminated, would
under Section 4069 of ERISA be deemed to be) an “employer” as defined in
Section 3(5) of ERISA.

                    “Purchase Money Indebtedness Cap” means an amount equal to
$250,000.00.

                    “Prepayment Event” means:

          (a) any sale, transfer or other disposition (including pursuant to a
sale and leaseback transaction) of any property or asset of any Loan Party,
other than dispositions described in Section 6.05(a); or

          (b) any casualty or other insured damage to, or any taking under power
of eminent domain or by condemnation or similar proceeding of, any property or
asset of any Loan Party with a fair value immediately prior to such event equal
to or greater than $500,000; or

          (c) the incurrence by any Loan Party of any Indebtedness, other than
Indebtedness permitted under Section 6.01 or permitted by the Required Lenders
pursuant to Section 9.02.

                    “Prime Rate” means the rate of interest per annum announced
from time to time by Chase as its prime rate in effect at its office located at
270 Park Avenue, New York, New York; each change in the Prime Rate shall be
effective from and including the date such change is announced as being
effective. THE PRIME RATE IS A REFERENCE RATE AND MAY NOT BE CHASE’S LOWEST
RATE.

                    “Projected Consolidated EBITDA” means Consolidated EBITDA in
the amounts set forth on the Schedule attached hereto identified as the
Projected EBITDA Schedule.

                    “Quotation Date” means, with relation to any Interest Period
for a EURIBOR Borrowing, or any other period for which the EURIBOR Rate is to be
determined pursuant to this Agreement, the day on which quotations would
ordinarily be given by leading banks in the European Interbank Market for
deposits in Euros, for delivery on the first day of the Interest Period or other
period, or if quotations would ordinarily be given on more than one day, the
last of such days.

                    “Register” has the meaning set forth in Section 9.04.

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

                    “Regulation U” means Regulation U of the Board of Governors
of the Federal Reserve System as from time to time in effect and any successor
or other regulation or official interpretation of said Board of Governors
relating to the extension of credit by banks for the purpose of purchasing or
carrying margin stocks applicable to member banks of the Federal Reserve System.

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

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                    “Required Lenders” means, at any time, Lenders having Credit
Exposure and unused Commitments representing more than 50% of the sum of the
total Credit Exposure and unused Commitments at such time. Notwithstanding the
foregoing to the contrary, with respect to decisions regarding Revolving Euro
Loans, Revolving Lenders means, at any time, Lenders having Revolving Euro
Exposure and Revolving Euro Commitments representing more than 50% of the sum of
the total Revolving Euro Exposure and unused Revolving Euro Commitments at such
time.

                    “Requirement of Law” means, as to any Person, the
Certificate of Incorporation and By-Laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.

                    “Restricted Payment” means any dividend or other
distribution (whether in cash, securities or other property) with respect to any
Equity Interests in the Borrower or any Subsidiary of the Borrower or of any
other Loan Party, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any such Equity Interests in the Borrower or any option, warrant or other right
to acquire any such Equity Interests in the Borrower.

                    “Revolving Commitment” means, with respect to each Lender,
the sum of such Lender’s Revolving USD Commitment and Revolving Euro Commitment.
The initial amount of each Lender’s Revolving Commitment is set forth on the
Commitment Schedule, or in the Assignment and Assumption pursuant to which such
Lender shall have assumed its Revolving Commitment, as applicable.

                    “Revolving Euro Commitment” means, with respect to each
Lender, the commitment, if any, of such Lender to make Revolving Euro Loans and
to acquire participations in Letters of Credit and Swingline Loans to the
Borrower hereunder, expressed as an amount representing the maximum possible
aggregate amount of such Lender’s Revolving Euro Exposure hereunder, as such
commitment may be reduced or increased from time to time pursuant to assignments
by or to such Lender pursuant to Section 9.04. The initial amount of each
Lender’s Revolving Euro Commitment is set forth on the Commitment Schedule, or
in the Assignment and Assumption pursuant to which such Lender shall have
assumed its Revolving Euro Commitment, as applicable. The initial aggregate
amount of the Lenders’ Revolving Euro Commitments is 3,000,000.00 Euro.

                    “Revolving Euro Exposure” means, with respect to any Lender
at any time, the sum of the outstanding principal amount of such Lender’s
Revolving Euro Loans at such time.

                    “Revolving Euro Lender” means, as of any date of
determination, a Lender with a Revolving Euro Commitment or, if the Revolving
Euro Commitments have terminated or expired, a Lender with Revolving Euro
Exposure.

                    “Revolving Euro Loan” means a Loan made pursuant to Section
2.01(b).

                    “Revolving Euro Loan Availability” means, at any time, an
amount equal to (a) the Revolving Euro Commitments; minus (b) the Revolving Euro
Exposure of all Revolving Euro Lenders at such time.

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

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                    “Revolving Euro Loan Maturity Date” means May 31, 2010, or
any earlier date on which: (i) the Revolving Euro Loan Commitments are reduced
to zero or otherwise terminated pursuant to the terms of this Agreement; or (ii)
the maturity of the Revolving Euro Loans is accelerated pursuant to the terms of
this Agreement.

                    “Revolving Euro Notes” has the meaning ascribed to such term
in Section 2.10(e).

                    “Revolving Exposure” means, with respect to any Lender at
any time, the sum of such Lender’s Revolving USD Exposure and Revolving Euro
Exposure at such time.

                    “Revolving Lender” means, as of any date of determination, a
Lender with a Revolving Commitment or, if the Revolving Commitments have
terminated or expired, a Lender with Revolving Exposure.

                    “Revolving Loan” means a Loan made pursuant to Section
2.01(a) or Section 2.01(b).

                    “Revolving USD Commitment” means, with respect to each
Lender, the commitment, if any, of such Lender to make Revolving USD Loans and
Swingline Loans to the Borrower hereunder, expressed as an amount representing
the maximum possible aggregate amount of such Lender’s Revolving USD Exposure
hereunder, as such commitment may be reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04. The
initial amount of each Lender’s Revolving USD Commitment is set forth on the
Commitment Schedule, or in the Assignment and Assumption pursuant to which such
Lender shall have assumed its Revolving USD Commitment, as applicable. The
initial aggregate amount of the Lenders’ Revolving USD Commitments is
$50,000,000.00.

                    “Revolving USD Exposure” means, with respect to any Lender
at any time, the sum of the outstanding principal amount of such Lender’s
Revolving USD Loans and an amount equal to its Applicable Percentage of the
aggregate principal amount of Swingline Loans to the Borrower and its LC
Exposure at such time.

                    “Revolving USD Lender” means, as of any date of
determination, a Lender with a Revolving USD Commitment or, if the Revolving USD
Commitments have terminated or expired, a Lender with Revolving USD Exposure.

                    “Revolving USD Loan” means a Loan made pursuant to Section
2.01(a).

                    “Revolving USD Loan Availability” means, at any time, an
amount equal to (a) the Revolving USD Commitments; minus (b) the Revolving USD
Exposure of all Revolving USD Lenders at such time; minus (c) the aggregate
undrawn amount of the Martin Yale Letter of Credit at such time; minus (d) the
aggregate amount of all disbursements of the Martin Yale Letter of Credit that
have not yet been reimbursed at such time.

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

                    “Revolving USD Loan Maturity Date” means May 31, 2010, or
any earlier date on which: (i) the Revolving USD Loan Commitments are reduced to
zero or otherwise terminated pursuant to the terms of this Agreement; or (ii)
the maturity of the Revolving USD Loans is accelerated pursuant to the terms of
this Agreement.

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                    “Revolving USD Notes” has the meaning ascribed to such term
in Section 2.10(e).

                    “S&P” means Standard & Poor’s Ratings Services, a division
of The McGraw Hill Companies, Inc.

                    “Secured Obligations” means all Obligations, together with
all (i) Banking Services Obligations owed by the Borrower, (ii) Swap Obligations
owed by the Borrower owing to one or more Lenders or their respective
Affiliates, and (iii) Chase’s London Branch Obligations owed by the Borrower;
provided that at or prior to the time that any transaction relating to such Swap
Obligation is executed, the Lender party thereto (other than Chase) shall have
delivered written notice to the Administrative Agent that such a transaction has
been entered into and that it constitutes a Secured Obligation entitled to the
benefits of the Collateral Documents.

                    “Security Agreement” means that certain Pledge and Security
Agreement, dated as of the date hereof, between the Borrower and the
Administrative Agent, for the benefit of the Administrative Agent and the
Lenders, and any other pledge or security agreement entered into, after the date
of this Agreement by any other Loan Party (as required by this Agreement or any
other Loan Document), or any other Person, as the same may be amended, restated
or otherwise modified from time to time.

                    “Statutory Reserve Rate” means a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board to which the Administrative Agent is
subject with respect to the Adjusted LIBO Rate, for eurocurrency funding
(currently referred to as “Eurocurrency Liabilities” in Regulation D of the
Board). Such reserve percentages shall include those imposed pursuant to such
Regulation D. LIBOR Loans shall be deemed to constitute eurocurrency funding and
to be subject to such reserve requirements without benefit of or credit for
proration, exemptions or offsets that may be available from time to time to any
Lender under such Regulation D or any comparable regulation. The Statutory
Reserve Rate shall be adjusted automatically on and as of the effective date of
any change in any reserve percentage.

                    “Subordinated Indebtedness” of a Person means any
Indebtedness of such Person the payment of which is subordinated to payment of
the Secured Obligations to the written satisfaction of the Administrative Agent.

                    “subsidiary” means, with respect to any Person (the
“parent”) at any date, any corporation, limited liability company, partnership,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent’s consolidated financial statements if such
financial statements were prepared in accordance with Agreement Accounting
Principles as of such date, as well as any other corporation, limited liability
company, partnership, association or other entity (a) of which securities or
other ownership interests representing more than 50% of the equity or more than
50% of the ordinary voting power or, in the case of a partnership, more than 50%
of the general partnership interests are, as of such date, owned, controlled or
held, or (b) that is, as of such date, otherwise Controlled, by the parent or
one or more subsidiaries of the parent or by the parent and one or more
subsidiaries of the parent.

                    “Subsidiary” means any direct or indirect subsidiary of the
Borrower or any other Loan Party, as applicable.

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

                    “Swap Obligations” of a Person means any and all obligations
of such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (a) any and all Swap
Agreements, and (b) any and all cancellations, buy backs, reversals,
terminations or assignments of any Swap Agreement transaction.

                    “Swingline Lender” means Chase, in its capacity as lender of
Swingline Loans hereunder.

                    “Swingline Loan” has the meaning assigned to such term in
Section 2.05(a).

                    “Taxes” means any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.

                    “Transactions” means the execution, delivery and performance
by the Borrower and the other Loan Parties of this Agreement and the other Loan
Documents, the granting of Liens on the assets of the Loan Parties, the
borrowing of Loans and other credit extensions, the use of the proceeds thereof,
the issuance of Letters of Credit hereunder and all other transactions
contemplated by this Agreement or any of the other Loan Documents.

                    “Treaty on European Union” means the Treaty of Rome of 25
March 1957, as amended by the Single European Act 1986 and the Maastricht Treaty
of 7 February 1992.

                    “Type”, when used in reference to any Loan or Borrowing,
refers to whether the rate of interest on such Loan, or on the Loans comprising
such Borrowing, is determined by reference to the Adjusted LIBO Rate or the
Alternate Base Rate.

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

                    “Unliquidated Obligations” means, at any time, any Secured
Obligations (or portion thereof) that are contingent in nature or unliquidated
at such time, including any Secured Obligation that is: (i) an obligation to
reimburse a bank for drawings not yet made under a letter of credit issued by
it; (ii) any other obligation (including any guarantee) that is contingent in
nature at such time; or (iii) an obligation to provide collateral to secure any
of the foregoing types of obligations.

                    “Unused Revolving Commitment” means, as of each date of
determination, the Revolving Commitments of all Lenders at such date, minus the
Revolving Exposure of all Lenders at such date.

                    “Withdrawal Liability” means liability to a Multiemployer
Plan as a result of a complete or partial withdrawal from such Multiemployer
Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

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                    SECTION 1.02. Classification of Loans and Borrowings. For
purposes of this Agreement, Loans may be classified and referred to by Class
(e.g., a “Revolving Loan”) or by Type (e.g., a “LIBOR Loan”) or by Class and
Type (e.g., a “LIBOR Revolving Loan”). Borrowings also may be classified and
referred to by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “LIBOR
Borrowing”) or by Class and Type (e.g., a “LIBOR Revolving Borrowing”).

                    SECTION 1.03. Terms Generally. The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include the
corresponding mascu­line, feminine and neuter forms. The words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation”. The word “will” shall be construed to have the same meaning and
effect as the word “shall”. Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person’s successors and assigns, (c) the words “herein”, “hereof” and
“hereunder”, and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement and (e) the words “asset” and “property” shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.

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

ARTICLE II

The Credits

                    SECTION 2.01. Commitments. Subject to the terms and
conditions set forth herein, each Lender agrees to make:

                    (a) Revolving USD Loans. Revolving USD Loans to the Borrower
from time to time during the Revolving USD Loan Availability Period in an
aggregate principal amount that will not result in (i) such Lender’s Revolving
USD Exposure exceeding at any time such Lender’s Revolving USD Commitment;
(ii) the aggregate Revolving USD Exposure of all Lenders exceeding at any time
the aggregate Revolving USD Commitments of all Lenders; (iii) such Lender’s
Revolving Exposure exceeding at any time such Lender’s Revolving Commitment; or
(iv) the aggregate Revolving Exposure of all Lenders exceeding at any time the
aggregate Revolving Commitments of all Lenders. Within the foregoing limits and
subject to the terms and conditions set forth herein, the Borrower may borrow,
prepay and reborrow Revolving USD Loans.

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                    (b) Revolving Euro Loans. Revolving Euro Loans to the
Borrower from time to time during the Revolving Euro Loan Availability Period in
an aggregate principal amount that will not result in (i) such Lender’s
Revolving Euro Exposure exceeding at any time such Lender’s Revolving Euro
Commitment; (ii) the aggregate Revolving Euro Exposure of all Lenders exceeding
at any time the aggregate Revolving Euro Commitments of all Lenders; (iii) such
Lender’s Revolving Exposure exceeding at any time such Lender’s Revolving
Commitment; or (iv) the aggregate Revolving Exposure of all Lenders exceeding at
any time the aggregate Revolving Commitments of all Lenders. Within the
foregoing limits and subject to the terms and conditions set forth herein, the
Borrower may borrow, prepay and reborrow Revolving Euro Loans.

                    SECTION 2.02. Loans and Borrowings. (a) Each Loan (other
than a Swingline Loan) shall be made as part of a Borrowing consisting of Loans
of the same Class and Type made by the Lenders ratably in accordance with their
respective Commitments of the applicable Class. Any Swingline Loan shall be made
in accordance with the procedures set forth in Section 2.05.

                    (b) Subject to Section 2.14, each Borrowing shall be
comprised entirely of ABR Loans, LIBOR Loans or EURIBOR Loans as the Borrower
may request in accordance herewith, provided that all Borrowings made on the
Effective Date must be made as ABR Borrowings but may be converted into LIBOR
Borrowings or EURIBOR Loans in accordance with Section 2.08. Each Lender at its
option may make any LIBOR Loan or EURIBOR Loan by causing any domestic or
foreign branch or Affiliate of such Lender to make such Loan; provided that any
exercise of such option shall not affect the obligation of the Borrower to repay
such Loan in accordance with the terms of this Agreement.

                    (c) At the commencement of each Interest Period for any
LIBOR Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $100,000 and not less than $1,000,000.00. At the
commencement of each Interest Period for any EURIBOR Borrowing, such Borrowing
shall be in an aggregate amount that is an integral multiple of 100,000 Euro and
not less than 1,000,000.00 Euro. ABR Borrowings may be in any amount. Borrowings
of more than one Type and Class may be outstanding at the same time; provided
that there shall not at any time be more than a total of 6 LIBOR Borrowings
outstanding and not more than 3 EURIBOR Borrowings outstanding.

                    (d) Notwithstanding any other provision of this Agreement,
the Borrower shall not be entitled to request, or to elect to convert or
continue, any Borrowing if the Interest Period requested with respect thereto
would end after the applicable Maturity Date.

                    SECTION 2.03. Requests for Borrowings. To request a
Revolving Borrowing, the Borrower shall notify the Administrative Agent of such
request either in writing (delivered by hand or facsimile) in a form approved by
the Administrative Agent and signed by the Borrower or by telephone (a) in the
case of a LIBOR Borrowing, not later than 9:00 a.m., Indianapolis, Indiana time,
two (2) Business Days before the date of the proposed Borrowing, (b) in the case
of a EURIBOR Borrowing, not later than 9:00 a.m., Indianapolis, Indiana time,
two (2) Business Days before the date of the proposed Borrowing or (c) in the
case of an ABR Borrowing, not later than 12:00 p.m., Indianapolis, Indiana time,
on the date of the proposed Borrowing; provided that any such notice of an ABR
Revolving Borrowing to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.06(A)(e), 2.06(e) may be given not later than 9:00
a.m., Indianapolis time, on the date of the proposed Borrowing. Each such
telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or facsimile to the Administrative Agent of a written
Borrowing Request in a form approved by the Administrative Agent and signed by
the Borrower. Each such telephonic and written Borrowing Request shall specify
the following information in compliance with Section 2.01:

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(i) the aggregate amount of the requested Borrowing and a breakdown of the
separate wires comprising such Borrowing;

 

 

 

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

 

 

 

(iii) whether such Borrowing is to be an ABR Borrowing, a LIBOR Borrowing, or a
EURIBOR Borrowing; and

 

 

 

(iv) in the case of a LIBOR Borrowing or EURIBOR Borrowing, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by the
definition of the term “Interest Period.”

If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no election as to the Class of Borrowing
is specified, then the requested Borrowing shall be a Revolving Borrowing. If no
Interest Period is specified with respect to any requested LIBOR Borrowing or
EURIBOR Borrowing, then the Borrower shall be deemed to have selected an
Interest Period of one month’s duration. Promptly following receipt of a
Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Lender of the details thereof and of the amount of such
Lender’s Loan to be made as part of the requested Borrowing.

                    SECTION 2.04. Reserved.

                    SECTION 2.05. Swingline Loans.

                    (a) The Administrative Agent, the Swingline Lender and the
Revolving USD Lenders agree that in order to facilitate the administration of
this Agreement and the other Loan Documents, promptly after the Borrower
requests an ABR Borrowing, the Swingline Lender may elect to have the terms of
this Section 2.05(a) apply to such Borrowing Request by advancing, on behalf of
the applicable Revolving USD Lenders and in the amount requested, same day funds
to the Borrower, on the applicable Borrowing date to the Funding Account(s)
(each such Loan made solely by the Swingline Lender pursuant to this Section
2.05(a) is referred to in this Agreement as a “Swingline Loan”), with settlement
among them as to the Swingline Loans to take place on a periodic basis as set
forth in Section 2.05(c). Each Swingline Loan shall be subject to all the terms
and conditions applicable to other ABR Loans funded by the Revolving USD
Lenders, except that all payments thereon shall be payable to the Swingline
Lender solely for its own account. The aggregate amount of Swingline Loans
outstanding at any time shall not exceed $5,000,000. The Swingline Lender shall
not make any Swingline Loan if the requested Swingline Loan exceeds Revolving
USD Loan Availability (before giving effect to such Swingline Loan). All
Swingline Loans shall be ABR Borrowings.

                    (b) Upon the making of a Swingline Loan (whether before or
after the occurrence of a Default and regardless of whether a Settlement has
been requested with respect to such Swingline Loan) each Revolving USD Lender
shall be deemed, without further action by any party hereto, to have
unconditionally and irrevocably purchased from the Swingline Lender without
recourse or warranty, an undivided interest and participation in such Swingline
Loan in proportion to its Applicable Percentage of the Revolving USD Commitment.
The Swingline Lender may, at any time, require the Revolving USD Lenders to fund
their participations. From and after the date, if any, on which any Revolving
USD Lender is required to fund its participation in any Swingline Loan purchased
hereunder, the Administrative Agent shall promptly distribute to such Lender,
such Lender’s Applicable Percentage of all payments of principal and interest
and all proceeds of Collateral received by the Administrative Agent in respect
of such Loan.

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                    (c) The Administrative Agent, on behalf of the Swingline
Lender, shall request settlement (a “Settlement”) with the Revolving USD Lenders
on at least a weekly basis or on any date that the Administrative Agent elects,
by notifying the Revolving USD Lenders of such requested Settlement by
facsimile, telephone, or e-mail no later than 12:00 noon Indianapolis, Indiana
time on the date of such requested Settlement (the “Settlement Date”). Each
Revolving USD Lender (other than the Swingline Lender, in the case of the
Swingline Loans) shall transfer the amount of such Revolving USD Lender’s
Applicable Percentage of the outstanding principal amount of the applicable Loan
with respect to which Settlement is requested to the Administrative Agent, to
such account of the Administrative Agent as the Administrative Agent may
designate, not later than 12:00 p.m., Indianapolis, Indiana time, on such
Settlement Date. Settlements may occur during the existence of a Default and
whether or not the applicable conditions precedent set forth in Section 4.02
have then been satisfied. Such amounts transferred to the Administrative Agent
shall be applied against the amounts of the Swingline Lender’s Swingline Loans
and, together with the Swingline Lender’s Applicable Percentage of such
Swingline Loan, shall constitute Revolving USD Loans of such Revolving USD
Lenders, respectively. If any such amount is not transferred to the
Administrative Agent by any Revolving Lender on such Settlement Date, the
Swingline Lender shall be entitled to recover such amount on demand from such
Lender together with interest thereon as specified in Section 2.07.

                    SECTION 2.06. Letters of Credit.

                    (a) General. Subject to the terms and conditions set forth
herein, the Borrower may request the issuance of Letters of Credit for its own
account, in a form reasonably acceptable to the Administrative Agent and the
Issuing Bank, at any time and from time to time during the Revolving Euro Loan
Availability Period. In the event of any inconsistency between the terms and
conditions of this Agreement and the terms and conditions of any form of letter
of credit application or other agreement submitted by the Borrower to, or
entered into by the Borrower with, the Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control.

                    (b) Notice of Issuance, Amendment, Renewal, Extension;
Certain Conditions. To request the issuance of a Letter of Credit (or the
amendment, renewal or extension of an outstanding Letter of Credit), the
Borrower shall hand deliver or facsimile (or transmit by electronic
communication, if arrangements for doing so have been approved by the Issuing
Bank) to the Issuing Bank and the Administrative Agent (prior to 10:00 a.m.,
Indianapolis, Indiana time, at least three (3) Business Days prior to the
requested date of issuance, amendment, renewal or extension) a notice requesting
the issuance of a Letter of Credit, or identifying the Letter of Credit to be
amended, renewed or extended, and specifying the date of issuance, amendment,
renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (which shall comply with paragraph (c) of this
Section 2.06), the amount of such Letter of Credit, the name and address of the
beneficiary thereof and such other information as shall be necessary to prepare,
amend, renew or extend such Letter of Credit. If requested by the Issuing Bank,
the Borrower also shall submit a letter of credit application on the Issuing
Bank’s standard form in connection with any request for a Letter of Credit. A
Letter of Credit shall be issued, amended, renewed or extended only if (and upon
issuance, amendment, renewal or extension of each Letter of Credit the Borrower
shall be deemed to represent and warrant that), after giving effect to such
issuance, amendment, renewal or extension (i) the LC Exposure shall not exceed
the Approved LC Amount; (ii) the aggregate Revolving USD Exposure of all Lenders
shall not exceed the aggregate Revolving USD Commitments of all Lenders; and
(iii) the aggregate Revolving Exposure of all Lenders shall not exceed the
aggregate Revolving Commitments of all Lenders.

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                    (c) Expiration Date. Each Letter of Credit shall expire at
or prior to the close of business on the earlier of (i) the date one year after
the date of the issuance of such Letter of Credit (or, in the case of any
renewal or extension thereof, one year after such renewal or extension) and
(ii) the date that is five (5) Business Days prior to the scheduled Revolving
USD Loan Maturity Date.

                    (d) Participations. By the issuance of a Letter of Credit
(or an amendment to a Letter of Credit increasing the amount thereof) and
without any further action on the part of the Issuing Bank or the Revolving USD
Lenders, the Issuing Bank hereby grants to each Revolving USD Lender, and each
Revolving USD Lender hereby acquires from the Issuing Bank, a participation in
such Letter of Credit equal to such Lender’s Applicable Percentage of the
aggregate amount available to be drawn under such Letter of Credit. In
consideration and in furtherance of the foregoing, each Revolving USD Lender
hereby absolutely and unconditionally agrees to pay to the Administrative Agent,
for the account of the Issuing Bank, such Lender’s Applicable Percentage of each
LC Disbursement made by the Issuing Bank and not reimbursed by the Borrower on
the date due as provided in paragraph (e) of this Section 2.06, or of any
reimbursement payment required to be refunded to the Borrower for any reason.
Each Revolving USD Lender acknowledges and agrees that its obligation to acquire
participations pursuant to this paragraph in respect of Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including any amendment, renewal or extension of any Letter of
Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.

                    (e) Reimbursement. If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such
LC Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 11:00 a.m., Indianapolis, Indiana time, on the date
that such LC Disbursement is made, if the Borrower shall have received notice of
such LC Disbursement prior to 9:00 a.m., Indianapolis, Indiana time, on such
date, or, if such notice has not been received by the Borrower prior to such
time on such date, then not later than 11:00 a.m., Indianapolis, Indiana time,
on (i) the Business Day that the Borrower receives such notice, if such notice
is received prior to 9:00 a.m., Indianapolis, Indiana time, on the day of
receipt, or (ii) the Business Day immediately following the day that the
Borrower receives such notice, if such notice is not received prior to such time
on the day of receipt; provided that if such LC Disbursement is not less than
$100,000, the Borrower may, subject to the conditions to borrowing set forth
herein, request in accordance with Section 2.03 that such payment be financed
with an ABR Revolving Borrowing or Swingline Loan in an equivalent amount and,
to the extent so financed, the Borrower’s obligation to make such payment shall
be discharged and replaced by the resulting ABR Revolving Borrowing or Swingline
Loan. If the Borrower fails to make such payment when due, the Administrative
Agent shall notify each Revolving USD Lender of the applicable LC Disbursement,
the payment then due from the Borrower in respect thereof and such Lender’s
Applicable Percentage thereof. Promptly following receipt of such notice, each
Revolving USD Lender shall pay to the Administrative Agent its Applicable
Percentage of the payment then due from the Borrower, in the same manner as
provided in Section 2.07 with respect to Loans made by such Lender (and
Section 2.07 shall apply, mutatis mutandis, to the payment obligations of the
Revolving USD Lenders), and the Administrative Agent shall promptly pay to the
Issuing Bank the amounts so received by it from the Revolving USD Lenders.
Promptly following receipt by the Administrative Agent of any payment from the
Borrower pursuant to this paragraph, the Administrative Agent shall distribute
such payment to the Issuing Bank or, to the extent that Revolving USD Lenders
have made payments pursuant to this paragraph to reimburse the Issuing Bank,
then to such Lenders and the Issuing Bank as their interests may appear. Any
payment made by a Revolving USD Lender pursuant to this paragraph to reimburse
the Issuing Bank for any LC Disbursement (other than the funding of ABR
Revolving Loans or a Swingline Loan as contemplated above) shall not constitute
a Loan and shall not relieve the Borrower of its obligation to reimburse such LC
Disbursement.

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                    (f) Obligations Absolute. The Borrower’s obligation to
reimburse LC Disbursements as provided in paragraph (e) of this Section 2.06
shall be absolute, unconditional and irrevocable, and shall be performed
strictly in accordance with the terms of this Agreement under any and all
circumstances whatsoever and irrespective of (i) any lack of validity or
enforceability of any Letter of Credit or this Agreement, or any term or
provision therein, (ii) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent or invalid in any respect or any
statement therein being untrue or inaccurate in any respect, (iii) payment by
the Issuing Bank under a Letter of Credit against presentation of a draft or
other document that does not comply with the terms of such Letter of Credit, or
(iv) any other event or circumstance whatsoever, whether or not similar to any
of the foregoing, that might, but for the provisions of this Section 2.06,
constitute a legal or equitable discharge of, or provide a right of setoff
against, the Borrower’s obligations hereunder. Neither the Administrative Agent,
the Revolving USD Lenders nor the Issuing Bank, nor any of their Related
Parties, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Bank; provided that the foregoing shall not be construed to excuse the
Issuing Bank from liability to the Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable law) suffered by
the Borrower that are caused by the Issuing Bank’s failure to exercise care when
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. The parties hereto expressly agree that,
in the absence of gross negligence or willful misconduct on the part of the
Issuing Bank (as finally determined by a court of competent jurisdiction), the
Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.

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

                    (h) Interim Interest. If the Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Revolving Loans;
provided that, if the Borrower fails to reimburse such LC Disbursement when due
pursuant to paragraph (e) of this Section 2.06, then Section 2.13(d) shall
apply. Interest accrued pursuant to this paragraph shall be for the account of
the Issuing Bank, except that interest accrued on and after the date of payment
by any Revolving USD Lender pursuant to paragraph (e) of this Section 2.06 to
reimburse the Issuing Bank shall be for the account of such Lender to the extent
of such payment.

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                    (i) Replacement of the Issuing Bank. The Issuing Bank may be
replaced as issuer of Letters of Credit at any time by written agreement among
the Borrower, the Administrative Agent, the replaced Issuing Bank and the
successor Issuing Bank. The Administrative Agent shall notify the Revolving USD
Lenders of any such replacement of the Issuing Bank. At the time any such
replacement shall become effective, the Borrower shall pay all unpaid fees
accrued for the account of the replaced Issuing Bank pursuant to Section 2.12.
From and after the effective date of any such replacement, (i) the successor
Issuing Bank shall have all the rights and obligations of the Issuing Bank under
this Agreement with respect to Letters of Credit to be issued thereafter and
(ii) references herein to the term “Issuing Bank” shall be deemed to refer to
such successor or to any previous Issuing Bank, or to such successor and all
previous Issuing Banks, as the context shall require. After the replacement of
an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto
and shall continue to have all the rights and obligations of an Issuing Bank
under this Agreement with respect to Letters of Credit issued by it prior to
such replacement, but shall not be required to issue additional Letters of
Credit.

                    (j) Cash Collateralization. If any Default shall occur and
be continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the
Revolving USD Loans has been accelerated, Revolving USD Lenders with LC Exposure
representing greater than 50% of the total LC Exposure) demanding the deposit of
cash collateral pursuant to this paragraph, the Borrower shall deposit in an
account with the Administrative Agent, in the name of the Administrative Agent
and for the benefit of the Revolving USD Lenders (the “LC Collateral Account”),
an amount in cash equal to 105% of the LC Exposure as of such date plus accrued
and unpaid interest thereon; provided that the obligation to deposit such cash
collateral shall become effective immediately, and such deposit shall become
immediately due and payable, without demand or other notice of any kind, upon
the occurrence of any Event of Default with respect to the Borrower described in
clause (h) or (i) of Article VII. Such deposit shall be held by the
Administrative Agent as collateral for the payment and performance of the
Secured Obligations. The Administrative Agent shall have exclusive dominion and
control, including the exclusive right of withdrawal, over such account and the
Borrower hereby grants the Administrative Agent a security interest in the LC
Collateral Account. Other than any interest earned on the investment of such
deposits, which investments shall be made at the option and sole discretion of
the Administrative Agent and at the Borrower’s’ risk and expense, such deposits
shall not bear interest. Interest or profits, if any, on such investments shall
accumulate in such account. Moneys in such account shall be applied by the
Administrative Agent to reimburse the Issuing Bank for LC Disbursements for
which it has not been reimbursed and, to the extent not so applied, shall be
held for the satisfaction of the reimbursement obligations of the Borrower for
the LC Exposure at such time or, if the maturity of the Loans has been
accelerated (but subject to the consent of Revolving USD Lenders with LC
Exposure representing greater than 50% of the total LC Exposure), be applied to
satisfy other Obligations in such manner and order as the Administrative Agent
elects in its Permitted Discretion. If the Borrower is required to provide an
amount of cash collateral hereunder as a result of the occurrence of a Default,
such amount (to the extent not applied as aforesaid) shall be returned to the
Borrower within three (3) Business Days after all such Defaults have been cured
or waived.

                    SECTION 2.07. Funding of Borrowings.

                     (a) Each Lender shall make each Loan to be made by it
hereunder on the proposed date thereof by wire transfer of immediately available
funds by 10:00 a.m., Indianapolis, Indiana time, to the account of the
Administrative Agent (or in the case of Euro Revolving Loans, to the account of
Chase’s London Branch) most recently designated by it for such purpose by notice
to the Lenders in an amount equal to such Lender’s Applicable Percentage;
provided that, Swingline Loans shall be made as provided in Section 2.05. The
Administrative Agent (or in the case of Euro Revolving Loans, to the account of
Chase’s London Branch) will make such Loans available to the Borrower by
promptly crediting the amounts so received, in like funds, to the Funding
Account(s); provided that ABR Revolving Loans made to finance the reimbursement
of an LC Disbursement as provided in Section 2.06(e) shall be remitted by the
Administrative Agent to the Issuing Bank.

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                    (b) Unless the Administrative Agent shall have received
notice from a Lender prior to the proposed date of any Borrowing that such
Lender will not make available to the Administrative Agent such Lender’s share
of such Borrowing, the Administrative Agent may assume that such Lender has made
such share available on such date in accordance with paragraph (a) of this
Section and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact made
its share of the applicable Borrowing available to the Administrative Agent,
then the applicable Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount with interest
thereon, for each day from and including the date such amount is made available
to the Borrower to but excluding the date of payment to the Administrative
Agent, at (i) in the case of such Lender, the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation or (ii) in the case of the
Borrower, the interest rate then applicable to ABR Loans. If such Lender pays
such amount to the Administrative Agent, then such amount shall constitute such
Lender’s Loan included in such Borrowing.

                    SECTION 2.08. Interest Elections.

                    (a) Each Revolving Borrowing initially shall be of the Type
specified in the applicable Borrowing Request and, in the case of a LIBOR
Borrowing and a EURIBOR Borrowing, shall have an initial Interest Period as
specified in such Borrowing Request. Thereafter, the Borrower may elect to
convert such Borrowing to a different Type or to continue such Borrowing and, in
the case of a LIBOR Borrowing and a EURIBOR Borrowing, may elect Interest
Periods therefor, all as provided in this Section. The Borrower may elect
different options with respect to different portions of the affected Borrowing,
in which case each such portion shall be allocated ratably among the Lenders
holding the Loans comprising such Borrowing, and the Loans comprising each such
portion shall be considered a separate Borrowing. This Section shall not apply
to Swingline Loans, which may not be converted or continued.

                    (b) To make an election pursuant to this Section, the
Borrower shall notify the Administrative Agent of such election by telephone by
the time that a Borrowing Request would be required under Section 2.03 if the
Borrower were requesting a Revolving Borrowing of the Type resulting from such
election to be made on the effective date of such election. Each such telephonic
Interest Election Request shall be irrevocable and shall be confirmed promptly
by hand delivery or facsimile to the Administrative Agent of a written Interest
Election Request in a form approved by the Administrative Agent and signed by
the Borrower.

                    (c) Each telephonic and written Interest Election Request
shall specify the following information in compliance with Section 2.02:

          (i) the Borrowing to which such Interest Election Request applies and,
if different options are being elected with respect to different portions
thereof, the portions thereof to be allocated to each resulting Borrowing (in
which case the information to be specified pursuant to clauses (iii) and (iv)
below shall be specified for each resulting Borrowing);

          (ii) the effective date of the election made pursuant to such Interest
Election Request, which shall be a Business Day;

          (iii) whether the resulting Borrowing is to be an ABR Borrowing, a
LIBOR Borrowing or a EURIBOR Borrowing; and

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          (iv) if the resulting Borrowing is a LIBOR Borrowing or EURIBOR
Borrowing, the Interest Period to be applicable thereto after giving effect to
such election, which shall be a period contemplated by the definition of the
term “Interest Period”.

If any such Interest Election Request requests a LIBOR Borrowing or EURIBOR
Borrowing but does not specify an Interest Period, then the Borrower shall be
deemed to have selected an Interest Period of one month’s duration.

                    (d) Promptly following receipt of an Interest Election
Request, the Administrative Agent shall advise each Lender of the details
thereof and of such Lender’s portion of each resulting Borrowing.

                    (e) If the Borrower fails to deliver a timely Interest
Election Request with respect to a LIBOR Borrowing or a EURIBOR Borrowing prior
to the end of the Interest Period applicable thereto, then, unless such
Borrowing is repaid as provided herein, at the end of such Interest Period such
Borrowing shall be converted to an ABR Borrowing. Notwithstanding any contrary
provision hereof, if a Default has occurred and is continuing and the
Administrative Agent, at the request of the Required Lenders, so notifies the
Borrower, then, so long as a Default is continuing (i) no outstanding Borrowing
may be converted to or continued as a LIBOR Borrowing or a EURIBOR Borrowing and
(ii) unless repaid, each LIBOR Borrowing and each EURIBOR Borrowing shall be
converted to an ABR Borrowing at the end of the Interest Period applicable
thereto.

                    SECTION 2.09. Termination of Commitments.

                    (a) Unless previously terminated, (i) the Revolving USD
Commitments shall terminate on the Revolving USD Loan Maturity Date; and (ii)
the Revolving Euro Commitments shall terminate on the Revolving Euro Loan
Maturity Date.

                    (b) The Borrower may at any time terminate the Commitments
upon (i) the payment in full of all outstanding Loans, together with accrued and
unpaid interest thereon and on any Letters of Credit, (ii) the cancellation and
return of all outstanding Letters of Credit (or alternatively, with respect to
each such Letter of Credit, the furnishing to the Administrative Agent of a cash
deposit (or at the discretion of the Administrative Agent a back up standby
letter of credit satisfactory to the Administrative Agent) equal to 105% of the
LC Exposure as of such date), (iii) the payment in full of the accrued and
unpaid fees and (iv) the payment in full of all reimbursable expenses and other
Secured Obligations together with accrued and unpaid interest thereon.

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

                    SECTION 2.10. Repayment of Loans; Evidence of Debt.

                    (a)(i) Revolving USD Loans. The Borrower hereby
unconditionally promise to pay to the Administrative Agent for the account of
each Revolving USD Lender ratably the then unpaid principal amount of each
Revolving USD Loan on the Revolving USD Loan Maturity Date; and

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                    (ii) Revolving Euro Loans. The Borrower hereby
unconditionally promise to pay to the Administrative Agent for the account of
each Revolving Euro Lender ratably the then unpaid principal amount of each
Revolving Euro Loan on the Revolving Euro Loan Maturity Date.

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

                    (c) The Administrative Agent shall maintain accounts in
which it shall record (i) the amount of each Loan made hereunder, the Class and
Type thereof and the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender’s share thereof.

                    (d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans in accordance with the terms of this Agreement.

                    (e) The obligation of:

          (i) the Borrower to pay the Revolving USD Loans shall be evidenced by
promissory notes executed, issued and delivered by the Borrower to the order of
each of the Revolving USD Lenders in substantially the form and substance of
Exhibit E (as such promissory notes may be amended, modified, supplemented,
replaced and/or restated from time to time and at any time, the “Revolving USD
Notes”); and

          (ii) the Borrower to pay the Revolving Euro Loans shall be evidenced
by promissory notes executed, issued and delivered by the Borrower to the order
of each of the Revolving Euro Lenders in substantially the form and substance of
Exhibit F (as such promissory notes may be amended, modified, supplemented,
replaced and/or restated from time to time and at any time, the “Revolving Euro
Notes”).

                    SECTION 2.11. Prepayment of Loans.

                    (a) The Borrower shall have the right at any time and from
time to time to prepay any Borrowing in whole or in part, subject to prior
notice in accordance with paragraph (e) of this Section.

                    (b) In the event and on such occasion that the aggregate
Revolving USD Exposure of all Lenders exceeds the total Revolving USD
Commitments, the Borrower shall prepay the Revolving USD Loans, Swingline Loans
and/or LC Exposure made in an aggregate amount equal to such excess. In the
event and on such occasion that the aggregate Revolving Exposure of all Lenders
exceeds the total Revolving Commitments, the Borrower shall prepay the Revolving
USD Loans, Swingline Loans and/or LC Exposure made in an aggregate amount equal
to such excess. In the event and on such occasion that the aggregate Revolving
Euro Exposure of all Lenders exceeds the total Revolving Euro Commitments, the
Borrower shall prepay the Revolving Euro Loans made to it in an aggregate amount
equal to such excess.

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                    (c) In the event and on each occasion that any Net Proceeds
are received by or on behalf of any Loan Party in respect of any Prepayment
Event, the Borrower, immediately after such Net Proceeds are received by any
Loan Party, shall prepay the Obligations as set forth in Section 2.11(d) below
in an aggregate amount equal to 100% of such Net Proceeds, provided that, in the
case of any event described in clause (a) or (b) of the definition of the term
“Prepayment Event”, if the Borrower shall deliver to the Administrative Agent a
certificate of a Financial Officer of the Borrower to the effect that the
Borrower intends to apply the Net Proceeds from such event (or a portion thereof
specified in such certificate), within 90 days after receipt of such Net
Proceeds, to acquire (or replace or rebuild) real property, Equipment or other
tangible assets (excluding Inventory) to be used in the business of the Loan
Parties, and certifying that no Default has occurred and is continuing, then no
prepayment shall be required pursuant to this paragraph in respect of the Net
Proceeds specified in such certificate, provided that to the extent of any such
Net Proceeds therefrom that have not been so applied by the end of such 90 day
period, at which time a prepayment shall be required in an amount equal to such
Net Proceeds that have not been so applied; provided, further a Loan Party’s use
of Net Proceeds to acquire (or replace or rebuild) real property, equipment or
other tangible assets (excluding inventory) shall be deemed Capital Expenditures
and the Loan Parties shall not be permitted to make elections to use Net
Proceeds to acquire (or replace or rebuild) real property, equipment or other
tangible assets (excluding inventory) with respect to Net Proceeds in any Fiscal
Year in an aggregate amount in excess of the amounts that would cause the
Capital Expenditures of the Loan Parties to exceed the limits set forth in
Section 6.12 of this Agreement.

                    (d) All such amounts prepaid pursuant to Section 2.11(c) (as
to any insurance or condemnation proceeds, to the extent they arise from
casualties or losses to Equipment, Fixtures and real property) shall be applied
to Obligations of the Borrower as follows: first to prepay Revolving USD Loans
(including Swingline Loans) (ratably in accordance with the then outstanding
amounts thereof) without a corresponding reduction in the Revolving USD
Commitment and to cash collateralize outstanding LC Exposure with respect to
Letters of Credit, second to prepay Revolving Euro Loans (ratably in accordance
with the then outstanding amounts thereof) without a corresponding reduction in
the Revolving Euro Commitment, third to any outstanding obligations of that
Borrower owing to the Lenders arising under any Guarantee executed by that
Borrower in connection with this Agreement, and fourth any remaining amounts
shall be applied as determined by the Administrative Agent in its Permitted
Discretion. If the precise amount of insurance or condemnation proceeds
allocable to Inventory as compared to Equipment, Fixtures and real property is
not otherwise determined, the allocation and application of those proceeds shall
be determined by the Administrative Agent, in its Permitted Discretion.

                    (e) The Borrower shall notify the Administrative Agent (and,
in the case of prepayment of a Swingline Loan, the Swingline Lender) by
telephone (confirmed by facsimile) of any prepayment hereunder (i) in the case
of prepayment of a LIBOR Borrowing, not later than 10:00 a.m., Indianapolis,
Indiana time, three (3) Business Days before the date of prepayment, (ii) in the
case of prepayment of a EURIBOR Borrowing, not later than 10:00 a.m.,
Indianapolis, Indiana time, three (3) Business Days before the date of
prepayment or (iii) in the case of prepayment of an ABR Borrowing, not later
than 10:00 a.m., Indianapolis, Indiana time, on the date of prepayment. Each
such notice shall be irrevocable and shall specify the prepayment date and the
principal amount of each Borrowing or portion thereof to be prepaid; provided
that, if a notice of prepayment is given in connection with a conditional notice
of termination of the Commitments as contemplated by Section 2.09, then such
notice of prepayment may be revoked if such notice of termination is revoked in
accordance with Section 2.09. Promptly following receipt of any such notice
relating to a Revolving Borrowing, the Administrative Agent shall advise the
Lenders of the contents thereof. Each partial prepayment of any Revolving
Borrowing shall be in an amount that would be permitted in the case of an
advance of a Revolving Borrowing of the same Type as provided in Section 2.02.
Each prepayment of a Borrowing shall be applied ratably to the Loans included in
the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to
the extent required by Section 2.13.

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                    SECTION 2.12. Fees.

                    (a) The Borrower agrees to pay to the Issuing Bank for the
account of the Issuing Bank (i) at the time of issuance of each Letter of
Credit, a fronting fee equal to 1.25% per annum on the face amount of such
Letter of Credit, and (ii) all customary administrative, issuance, amendment,
payment and negotiation fees and charges of the Issuing Bank in accordance with
the Issuing Bank’s standard schedule for such fees and charges as in effect from
time to time.

                    (b) The Borrower agrees to pay to the Administrative Agent
for the account of the Revolving USD Lenders a participation fee with respect to
their participations in each Letter of Credit issued for the account of the
Borrower at a per annum rate equal to the Applicable Rate then in effect with
respect to Letters of Credit on the face amount of each Letter of Credit
(calculated on the date of issuance and on each anniversary date thereof). Each
Revolving USD Lender shall receive a pro rata share of each participation fee
based on its Applicable Percentage with respect to the LC Exposure.
Participation fees with respect to each Letter of Credit shall be payable in
advance in equal quarterly payments with the first payment being due on the date
of issuance of such Letter of Credit and successive payments being due on the
same day of every third calendar month thereafter until the Revolving USD
Lenders cease to have any facility LC Exposure with respect to such Letter of
Credit.

                    (c) The Borrowers agree to pay to the Administrative Agent
for the ratable benefit of each Revolving Lender a commitment fee (the
“Commitment Fee”), which shall accrue at the Applicable Rate with respect to the
Commitment Fee then in effect on the average daily Unused Revolving Commitment
for the period from and including the Effective Date to but excluding the date
on which the Lenders’ Revolving Commitments terminate. The accrued Commitment
Fee shall be payable in arrears on the last day of each Fiscal Quarter of the
Borrower and on the date on which the Revolving Commitments terminate,
commencing on the first such date to occur after the date hereof.

                    (d) The Borrower agrees to pay to the Administrative Agent,
for its own account, fees payable in the amounts and at the times set forth in
the Fee Letter, dated April 30, 2009, issued by Chase and accepted by the
Borrower, as such Fee Letter may be amended, modified or replaced.

                    (e) All fees payable hereunder shall be paid on the dates
due, in immediately available funds, to the Administrative Agent for
distribution, in the case of participation fees and the Commitment Fee, to the
Lenders. Fees paid shall not be refundable under any circumstances.

                    SECTION 2.13. Interest.

                    (a) The Loans comprising each ABR Borrowing (including each
Swingline Loan) shall bear interest at the greater of (i) Alternate Base Rate
plus the Applicable Rate or (ii) 4% per annum.

                    (b) The Loans comprising each LIBOR Borrowing shall bear
interest at the Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Rate.

                    (c) The Loans comprising each EURIBOR Borrowing shall bear
interest at the EURIBOR for the Interest Period in effect for such Borrowing
plus the Applicable Rate.

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                    (d) Notwithstanding the foregoing, during the occurrence and
continuance of a Default, the Administrative Agent or the Required Lenders may,
at their option, by notice to the Borrower (which notice may be revoked at the
option of the Required Lenders notwithstanding any provision of Section 9.02
requiring the consent of “each Lender affected thereby” for reductions in
interest rates), declare that (i) all Loans shall bear interest at 2% per annum
plus the rate otherwise applicable to such Loans as provided in the preceding
paragraphs of this Section or (ii) in the case of any other amount outstanding
hereunder, such amount shall accrue at 2% per annum plus the rate applicable to
such fee or other obligation as provided hereunder. Notwithstanding the
foregoing to the contrary, upon the occurrence of any Event of Default with
respect to the Borrower described in clause (h) or (i) of Article VII, all Loans
and fees automatically shall bear interest at 2% per annum plus the rate
otherwise applicable to such Loans or fees.

                    (e) Accrued interest on each Loan (for ABR Loans, accrued
through the last day of the prior calendar month) shall be payable in arrears on
each Interest Payment Date for such Loan and upon termination of the applicable
Commitments and/or the applicable Maturity Date; provided that (i) interest
accrued pursuant to paragraph (d) of this Section shall be payable on demand,
(ii) in the event of any repayment or prepayment of any Loan (other than a
prepayment of an ABR Revolving Loan prior to the end of the Revolving USD Loan
Availability Period or the Revolving Euro Loan Availability Period, as
applicable), accrued interest on the principal amount repaid or prepaid shall be
payable on the date of such repayment or prepayment and (iii) in the event of
any conversion of any LIBOR Loan or EURIBOR Loan prior to the end of the current
Interest Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion.

                    (f) All interest and fees hereunder shall be computed on the
basis of a year of 360 days, except that interest computed by reference to the
Alternate Base Rate at times when the Alternate Base Rate is based on the Prime
Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed.
The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be
determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.

                    SECTION 2.14. Alternate Rate of Interest. If prior to the
commencement of any Interest Period for a LIBOR Borrowing or a EURIBOR
Borrowing:

          (a) the Administrative Agent determines (which determination shall be
conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBO Rate, the LIBO Rate, or the EURIBOR
Rate as applicable, for such Interest Period; or

          (b) the Administrative Agent is advised by the Required Lenders that
the Adjusted LIBO Rate, the LIBO Rate, or the EURIBOR Rate, as applicable, for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (or Lender) of making or maintaining their Loans (or its Loan) included
in such Borrowing for such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or facsimile as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a LIBOR Borrowing or a EURIBOR Borrowing shall
be ineffective, and (ii) if any Borrowing Request requests a LIBOR Borrowing or
a EURIBOR Borrowing, such Borrowing shall be made as an ABR Borrowing.

                    SECTION 2.15. Increased Costs.

                    (a) If any Change in Law shall:

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          (i) impose, modify or deem applicable any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of, or
credit extended by, any Lender (except any such reserve requirement reflected in
the Adjusted LIBO Rate) or the Issuing Bank; or

          (ii) impose on any Lender, the Issuing Bank, the London interbank
market or the European Interbank Market any other condition affecting this
Agreement or LIBOR Loans or EURIBOR Loans made by such Lender or any Letter of
Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such
Lender of making or main­taining any LIBOR Loan or EURIBOR Loan (or of
maintaining its obligation to make any such Loan) or to increase the cost to
such Lender or the Issuing Bank of participating in, issuing or maintaining any
Letter of Credit or to reduce the amount of any sum received or receiv­able by
such Lender or the Issuing Bank hereunder (whether of principal, interest or
otherwise), then the Borrower will pay to such Lender or the Issuing Bank, as
the case may be, such additional amount or amounts as will compensate such
Lender or the Issuing Bank, as the case may be, for such additional costs
incurred or reduction suffered.

                    (b) If any Lender or the Issuing Bank determines that any
Change in Law regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender’s or the Issuing Bank’s capital or on
the capital of such Lender’s or the Issuing Bank’s holding company, if any, as a
consequence of this Agreement or the Loans made by, or participations in Letters
of Credit held by, such Lender, or the Letters of Credit issued by the Issuing
Bank, to a level below that which such Lender or the Issuing Bank or such
Lender’s or the Issuing Bank’s holding company could have achieved but for such
Change in Law (taking into consideration such Lender’s or the Issuing Bank’s
policies and the policies of such Lender’s or the Issuing Bank’s holding company
with respect to capital adequacy), then from time to time the Borrower will pay
to such Lender or the Issuing Bank, as the case may be, such additional amount
or amounts as will compensate such Lender or the Issuing Bank or such Lender’s
or the Issuing Bank’s holding company for any such reduction suffered.

                    (c) A certificate of a Lender or the Issuing Bank setting
forth the amount or amounts necessary to compensate such Lender or the Issuing
Bank or its holding company, as the case may be, as specified in paragraph (a)
or (b) of this Section shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender or the
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 10 days after receipt thereof.

                    (d) Failure or delay on the part of any Lender or the
Issuing Bank to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender’s or the Issuing Bank’s right to demand such
compensation; provided that the Borrower shall not be required to compensate a
Lender or the Issuing Bank pursuant to this Section for any increased costs or
reductions incurred more than 270 days prior to the date that such Lender or the
Issuing Bank, as the case may be, notifies the Borrower of the Change in Law
giving rise to such increased costs or reductions and of such Lender’s or the
Issuing Bank’s intention to claim compensation therefor; provided further that,
if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 270-day period referred to above shall be extended to
include the period of retroactive effect thereof.

                    SECTION 2.16. Break Funding Payments.

                    (a) In the event of (a) the payment of any principal of any
LIBOR Loan or EURIBOR Loan other than on the last day of an Interest Period
applicable thereto (including as a result of an Event of Default), (b) the
conversion of any LIBOR Loan or EURIBOR Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any LIBOR Loan or EURIBOR Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice may be revoked
under Section 2.09(c) and is revoked in accordance therewith), or (d) the
assignment of any LIBOR Loan or EURIBOR Loan other than on the last day of the
Interest Period applicable thereto as a result of a request by the Borrower
pursuant to Section 2.19, then, in any such event, the Borrower shall compensate
each Lender for the loss, cost and expense attributable to such event.

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                    (b) In the case of a LIBOR Loan, such loss, cost or expense
to any Lender shall be deemed to include an amount determined by such Lender to
be the excess, if any, of (i) the amount of interest which would have accrued on
the principal amount of such Loan had such event not occurred, at the Adjusted
LIBO Rate that would have been applicable to such Loan, for the period from the
date of such event to the last day of the then current Interest Period therefor
(or, in the case of a failure to borrow, convert or continue, for the period
that would have been the Interest Period for such Loan), over (ii) the amount of
interest which would accrue on such principal amount for such period at the
interest rate which such Lender would bid were it to bid, at the commencement of
such period, for dollar deposits of a comparable amount and period from other
banks in the eurodollar market.

                    (c) In the case of a EURIBOR Loan, such loss, cost or
expense to any Lender shall be deemed to include an amount determined by such
Lender to be the excess, if any, of (i) the amount of interest which would have
accrued on the principal amount of such Loan had such event not occurred, at the
EURIBOR Rate that would have been applicable to such Loan, for the period from
the date of such event to the last day of the then current Interest Period
therefor (or, in the case of a failure to borrow, convert or continue, for the
period that would have been the Interest Period for such Loan), over (ii) the
amount of interest which would accrue on such principal amount for such period
at the interest rate which such Lender would bid were it to bid, at the
commencement of such period, for Euro deposits, as applicable, of a comparable
amount and period from other banks in the European Interbank Market.

                    (d) A certificate of any Lender setting forth any amount or
amounts that such Lender is entitled to receive pursuant to this Section shall
be delivered to the Borrower and shall be conclusive absent manifest error. The
Borrower shall pay such Lender the amount shown as due on any such certificate
within 10 days after receipt thereof.

                    SECTION 2.17. Taxes.

                    (a) Any and all payments by or on account of any obligation
of the Borrower hereunder shall be made free and clear of and without deduction
for any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
(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) the Administrative Agent, Lender or Issuing Bank (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.

                    (b) In addition, the Borrower shall pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law.

                    (c) The Borrower shall indemnify the Administrative Agent,
each Lender and the Issuing Bank, within 10 days after written demand therefor,
for the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent, such Lender or the Issuing Bank, as the case may be, on or
with respect to any payment by or on account of any obligation of the Borrower
hereunder (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. A certificate as to the amount
of such payment or liability delivered to the Borrower by a Lender or the
Issuing Bank, or by the Administrative Agent on its own behalf or on behalf of a
Lender or the Issuing Bank, shall be conclusive absent manifest error.

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                    (d) As soon as practicable after any payment of Indemnified
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.

                    (e) Any Foreign Lender that is entitled to an exemption from
or reduction of withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law, such properly completed and executed documentation prescribed by applicable
law or reasonably requested by the Borrower as will permit such payments to be
made without withholding or at a reduced rate.

                    (f) If the Administrative Agent or a Lender determines, in
its sole discretion, that it has received a refund of any Taxes or Other Taxes
as to which it has been indemnified by the Borrower or with respect to which the
Borrower has paid additional amounts pursuant to this Section 2.17, it shall pay
over such refund to the Borrower (but only to the extent of indemnity payments
made, or additional amounts paid, by the Borrower under this Section 2.17 with
respect to the Taxes or Other Taxes giving rise to such refund), net of all
out-of-pocket expenses of the Administrative Agent or such Lender and without
interest (other than any interest paid by the relevant Governmental Authority
with respect to such refund); provided, that the Borrower, upon the request of
the Administrative Agent or such Lender, agrees to repay the amount paid over to
the Borrower (plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) to the Administrative Agent or such Lender in
the event the Administrative Agent or such Lender is required to repay such
refund to such Governmental Authority. This Section shall not be construed to
require the Administrative Agent or any Lender to make available its tax returns
(or any other information relating to its taxes which it deems confidential) to
the Borrower or any other Person.

                    SECTION 2.18. Payments Generally; Allocation of Proceeds;
Sharing of Set-offs.

                    (a) The Borrower shall make each payment required to be made
by it hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.15, 2.16 or 2.17, or
otherwise) prior to 12:00 p.m., Indianapolis, Indiana time, on the date when
due, in immediately available funds, without set-off or counterclaim. Any
amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 1 East Ohio Street,
Indianapolis, IN 46204, except payments to be made directly to the Issuing Bank
or Swingline Lender as expressly provided herein and except that payments
pursuant to Sections 2.15, 2.16, 2.17 and 9.03 shall be made directly to the
Persons entitled thereto. The Administrative Agent shall distribute any such
payments received by it for the account of any other Person to the appropriate
recipient promptly following receipt thereof. If any payment hereunder shall be
due on a day that is not a Business Day, the date for payment shall be extended
to the next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such extension.
All payments hereunder shall be made in dollars, or solely with respect to the
Revolving Euro Loans, Euros. Solely for purposes of determining the amount of
Loans available for borrowing purposes, checks from collections of items of
payment and proceeds of any Collateral shall be applied in whole or in part
against the Obligations, on the Business Day after receipt, subject to actual
collection.

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                    (b) Any proceeds of Collateral received by the
Administrative Agent (i) not constituting either (A) a specific payment of
principal, interest, fees or other sum payable under the Loan Documents (which
shall be applied as specified by the Borrower), or (B) a mandatory prepayment
(which shall be applied in accordance with Section 2.11) or (ii) after an Event
of Default has occurred and is continuing and the Administrative Agent so elects
or the Required Lenders so direct, such funds shall be applied ratably to
Obligations of the Borrower first, to pay any fees, indemnities, or expense
reimbursements including amounts then due to the Administrative Agent and the
Issuing Bank from the Borrower (other than in connection with Banking Services
or Swap Obligations), second, to pay any fees or expense reimbursements then due
to the Lenders from the Borrower (other than in connection with Banking Services
or Swap Obligations), third, to pay interest then due and payable on the Loans
to the Borrower ratably, fourth, to prepay principal on the Loans to the
Borrower and unreimbursed LC Disbursements with respect to Letters of Credit
issued for the account of the Borrower, fifth, to pay an amount to the
Administrative Agent equal to one hundred five percent (105%) of the aggregate
undrawn face amount of all outstanding Letters of Credit issued for the account
of the Borrower and the aggregate amount of any unpaid LC Disbursements with
respect to Letters of Credit issued for the account of the Borrower, to be held
as cash collateral for such Obligations, sixth, to payment of any amounts owing
by the Borrower with respect to Banking Services and Swap Obligations, and
seventh, to the payment of any other Secured Obligations of the Borrower due to
the Administrative Agent or any Lender. Notwithstanding anything to the contrary
contained in this Agreement, unless so directed by the Borrower, or unless a
Default is in existence, neither the Administrative Agent nor any Lender shall
apply any payment which it receives to any LIBOR Loan of a Class or any EURIBOR
Loan of a Class, except (a) on the expiration date of the Interest Period
applicable to any such LIBOR Loan or any such EURIBOR Loan or (b) in the event,
and only to the extent, that there are no outstanding ABR Loans of the same
Class and, in any such event, the Borrower shall pay the break funding payment
required in accordance with Section 2.16. The Administrative Agent and the
Lenders shall have the continuing and exclusive right to apply and reverse and
reapply any and all such proceeds and payments to any portion of the Secured
Obligations of the Borrower.

                    (c) At the election of the Administrative Agent, all
payments of principal, interest, LC Disbursements, fees, premiums, reimbursable
expenses (including, without limitation, all reimbursement for fees and expenses
pursuant to Section 9.03), and other sums payable under the Loan Documents, may
be paid from the proceeds of Borrowings made hereunder whether made following a
request by the Borrower pursuant to Section 2.03 or a deemed request as provided
in this Section or may be deducted from any deposit account of the Borrower
maintained with the Administrative Agent. The Borrower hereby irrevocably
authorizes (i) the Administrative Agent to make a Borrowing for the purpose of
paying each payment of principal, interest and fees owed by it as it becomes due
hereunder or any other amount due under the Loan Documents and agrees that all
such amounts charged shall constitute Loans (including Swingline Loans)), and
that all such Borrowings shall be deemed to have been requested pursuant to
Sections 2.03, 2.04 or 2.05, as applicable and (ii) the Administrative Agent to
charge any deposit account of the Borrower maintained with the Administrative
Agent for each payment of principal, interest and fees owed by it as it becomes
due hereunder or any other amount due under the Loan Documents.

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                    (d) If any Lender shall, by exercising any right of set-off
or counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans or participations in LC Disbursements resulting in
such Lender receiving payment of a greater proportion of the aggregate amount of
its Loans and participations in LC Disbursements and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such
greater proportion shall purchase (for cash at face value) participations in the
Loans and participations in LC Disbursements of other Lenders to the extent
necessary so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and participations in LC
Disbursements; provided that (i) if any such participations are purchased and
all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph
shall not be construed to apply to any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or participations in LC Disbursements to any
assignee or participant, other than to the Borrower or any Subsidiary or
Affiliate thereof (as to which the provisions of this paragraph shall apply).
The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of set-off and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.

                    (e) Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Bank
hereunder that the Borrower will not make such payment, the Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the Issuing Bank, as the case may be, the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders or the
Issuing Bank, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of payment
to the Administrative Agent, at the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation.

                    (f) If any Lender shall fail to make any payment required to
be made by it pursuant to Section 2.05, 2.06(d) or (e), 2.07(b), 2.18(e) or
9.03(c), then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender’s
obligations under such Sections until all such unsatisfied obligations are fully
paid.

                    SECTION 2.19. Mitigation Obligations; Replacement of
Lenders. If any Lender requests compensation under Section 2.15, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.17,
then:

                    (a) such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 2.15 or 2.17,
as the case may be, in the future and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender (and the Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or assignment);

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                    (b) the Borrower may, at its sole expense and effort,
require such Lender or any Lender that defaults in its obligation to fund Loans
hereunder (herein, a “Departing Lender”), upon notice to the Departing Lender
and the Administrative Agent, to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in Section 9.04), all
its interests, rights and obligations under this Agreement to an assignee that
shall assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment); provided that (i) the Borrower shall have received the
prior written consent of the Administrative Agent (and if a Revolving Euro
Commitment and/or Letter of Credit Commitment is being assigned, the Issuing
Bank), which consent shall not unreasonably be withheld, (ii) the Departing
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and participations in LC Disbursements and Swingline
Loans, accrued interest thereon, accrued fees and all other amounts payable to
it hereunder, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts)
and (iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.15 or payments required to be made pursuant to
Section 2.17, such assignment will result in a reduction in such compensation or
payments. A Departing Lender shall not be required to make any such assignment
and delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.

                    SECTION 2.20. Returned Payments. If after receipt of any
payment which is applied to the payment of all or any part of the Obligations,
the Administrative Agent or any Lender is for any reason compelled to surrender
such payment or proceeds to any Person because such payment or application of
proceeds is invalidated, declared fraudulent, set aside, determined to be void
or voidable as a preference, impermissible setoff, or a diversion of trust
funds, or for any other reason, then the Obligations or part thereof intended to
be satisfied shall be revived and continued and this Agreement shall continue in
full force as if such payment or proceeds had not been received by the
Administrative Agent or such Lender. The provisions of this Section 2.20 shall
be and remain effective notwithstanding any contrary action which may have been
taken by the Administrative Agent or any Lender in reliance upon such payment or
application of proceeds. The provisions of this Section 2.20 shall survive the
termination of this Agreement.

ARTICLE III

Representations and Warranties

Each Loan Party represents and warrants to the Lenders as follows:

                    SECTION 3.01. Organization; Powers. Each of the Loan Parties
and each of its Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, has all
requisite power and authority to carry on its business as now conducted and is
qualified to do business in, and is in good standing in, every jurisdiction
where such qualification is required.

                    SECTION 3.02. Authorization; Enforceability. The
Transactions are within each Loan Party’s limited liability company or corporate
powers, as the case may be, and have been duly authorized by all necessary
corporate or limited liability company action and, if required, stockholder,
member or manager action. The Loan Documents to which each Loan Party is a party
have been duly executed and delivered by such Loan Party and constitute a legal,
valid and binding obligation of such Loan Party, enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law.

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

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                    SECTION 3.04. Financial Statements; No Material Adverse
Change.

                    (a) The most recent consolidated financial statements of the
Borrower and its Subsidiaries delivered to the Administrative Agent were
prepared in accordance with Agreement Accounting Principles in effect on the
date such statements were prepared and present fairly the consolidated financial
condition and operations of the Borrower and its Subsidiaries at such date and
the consolidated results of their operation of the period then ended.

                    (b) Since the date of the financial statements referred to
in Section 3.04(a), no event, change or condition has occurred that has had, or
could reasonably be expected to have, a Material Adverse Effect.

                    SECTION 3.05. Properties.

                    (a) Schedule 3.05sets forth the address of each parcel of
real property that is owned or leased by each Loan Party. Each of such leases
and subleases is valid and enforceable in accordance with its terms and is in
full force and effect, and no default by any party to any such lease or sublease
exists. Each of the Loan Parties and its Subsidiaries has good and indefeasible
title to, or valid leasehold interests in, all its real and personal property,
free of all Liens other than those permitted by Section 6.02.

                    (b) Each Loan Party and its Subsidiaries owns, or is
licensed to use, all trademarks, trade names, patents and other intellectual
property necessary to its business as currently conducted, a correct and
complete list of which, as of the date of this Agreement, is set forth in each
of the Security Agreements, and the use thereof by the Loan Parties and its
Subsidiaries does not infringe in any material respect upon the rights of any
other Person, and the Loan Parties’ rights thereto are not subject to any
licensing agreement or similar arrangement.

                    SECTION 3.06. Litigation and Environmental Matters.

                    (a) There are no actions, suits or proceedings by or before
any arbitrator or Governmental Authority pending against or, to the knowledge of
any Loan Party, threatened against or affecting the Loan Parties or any of their
Subsidiaries (i) as to which there is a reasonable possibility of an adverse
determination and that, if adversely determined, could reasonably be expected,
individually or in the aggregate, to result in a Material Adverse Effect (other
than the Disclosed Matters) or (ii) that involve this Agreement or the
Transactions.

                    (b) To its knowledge, except for the Disclosed Matters, (i)
no Loan Party nor any of its Subsidiaries has received notice of any claim with
respect to any Environmental Liability or knows of any basis for any
Environmental Liability and (ii) and except with respect to any other matters
that, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect, no Loan Party nor any of its Subsidiaries
(1) has failed to comply with any Environmental Law or to obtain, maintain or
comply with any permit, license or other approval required under any
Environmental Law or (2) has become subject to any Environmental Liability.

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                    (c) Since the date of this Agreement, there has been no
change in the status of the Disclosed Matters that, individually or in the
aggregate, has resulted in, or materially increased the likelihood of, a
Material Adverse Effect.

                    (d) To the best knowledge of the Borrower after due inquiry
and investigation, there are no underground storage tanks of any kind on any
premises owned or occupied by or under lease to the Borrower or any of its
Subsidiaries and there are no tanks, drums, or other containers of any kind on
premises owned or occupied by or under lease to the Borrower or any of its
Subsidiaries, the contents of which are unknown to the Borrower. To the best
knowledge of the Borrower after due inquiry and investigation, no Hazardous
Materials in reportable quantities have been released on any such premises nor
is there any threat of release of any Hazardous Materials in reportable
quantities on any such premises.

                    SECTION 3.07. Compliance with Laws and Agreements. Each Loan
Party and its Subsidiaries is in compliance with all Requirements of Law
applicable to it or its property and all indentures, agreements and other
instruments binding upon it or its property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect. No Default has occurred and is continuing.

                    SECTION 3.08. Investment Company Status. No Loan Party nor
any of its Subsidiaries is an “investment company” as defined in, or subject to
regulation under, the Investment Company Act of 1940.

                    SECTION 3.09. Taxes. Each Loan Party and its Subsidiaries
has timely filed or caused to be filed all Tax returns and reports required to
have been filed and has paid or caused to be paid all Taxes required to have
been paid by it, except Taxes that are being contested in good faith by
appropriate proceedings and for which such Loan Party or such Subsidiary, as
applicable, has set aside on its books adequate reserves. No tax liens have been
filed and no claims are being asserted with respect to any such taxes.

                    SECTION 3.10. ERISA. No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such ERISA
Events for which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect. The present value of all
accumulated benefit obligations under each Plan (based on the assumptions used
for purposes of Statement of Financial Accounting Standards No. 87) did not, as
of the date of the most recent financial statements reflecting such amounts,
exceed by more than $100,000 the fair market value of the assets of such Plan,
and the present value of all accumulated benefit obligations of all underfunded
Plans (based on the assumptions used for purposes of Statement of Financial
Accounting Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed by more than $100,000 the
fair market value of the assets of all such underfunded Plans.

                    SECTION 3.11. Disclosure. Each Loan Party has disclosed to
the Lenders all agreements, instruments and corporate or other restrictions to
which it or any Subsidiary is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. None of the reports, financial statements, certificates
or other information furnished by or on behalf of the any Loan Party to the
Administrative Agent or any Lender in connection with the negotiation of this
Agreement or any other Loan Document (as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading.

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                    SECTION 3.12. Material Agreements. No Loan Party is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in (i) any material agreement to which it is a
party or (ii) any agreement or instrument evidencing or governing Indebtedness.

                    SECTION 3.13. Solvency.

                    (a) Immediately after the consummation of the Transactions
to occur on the Effective Date, (i) the fair value of the assets of each Loan
Party, at a fair valuation, will exceed its debts and liabilities, subordinated,
contingent or otherwise; (ii) the present fair saleable value of the property of
each Loan Party will be greater than the amount that will be required to pay the
probable liability of its debts and other liabilities, subordinated, contingent
or otherwise, as such debts and other liabilities become absolute and matured;
(iii) each Loan Party will be able to pay its debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured; and (iv) each Loan Party will not have unreasonably small
capital with which to conduct the business in which it is engaged as such
business is now conducted and is proposed to be conducted after the Effective
Date.

                    (b) No Loan Party intends to, or will permit any of its
Subsidiaries to, and no Loan Party believes that it or any of its Subsidiaries
will, incur debts beyond its ability to pay such debts as they mature, taking
into account the timing of and amounts of cash to be received by it or any such
Subsidiary and the timing of the amounts of cash to be payable on or in respect
of its Indebtedness or the Indebtedness of any such Subsidiary.

                    SECTION 3.14. Insurance. Schedule 3.14 sets forth a
description of all insurance maintained by or on behalf of the Loan Parties and
the Subsidiaries as of the Effective Date. As of the Effective Date, all
premiums in respect of such insurance have been paid. The Loan Parties believe
that the insurance maintained by or on behalf of the Loan Parties and their
Subsidiaries is adequate.

                    SECTION 3.15. Capitalization and Subsidiaries. Schedule 3.15
sets forth (a) a correct and complete list of the name and relationship to the
Borrower and all of its Subsidiaries, (b) a true and complete listing of each
class of the Borrower’s authorized Equity Interests, of which all of such issued
shares are validly issued, outstanding, fully paid and non-assessable, and (c)
the type of entity of the Borrower and each of its Subsidiaries. All of the
issued and outstanding Equity Interests owned by any Loan Party has been (to the
extent such concepts are relevant with respect to such ownership interests) duly
authorized and issued and is fully paid and non-assessable.

                    SECTION 3.16. Regulation U. Margin stock (as defined in
Regulation U) constitutes less than 25% of the value of those assets of the
Borrower and its Subsidiaries which are subject to any limitation on sale,
pledge, or other restriction hereunder.

                    SECTION 3.17. Employment Matters. As of the Effective Date,
there are no strikes, lockouts or slowdowns against any Loan Party or any
Subsidiary pending or, to the knowledge of the Loan Parties, threatened. The
hours worked by and payments made to employees of the Loan Parties and the
Subsidiaries have not been in violation of the Fair Labor Standards Act or any
other applicable Federal, state, local or foreign law dealing with such matters.
All payments due from any Loan Party or any Subsidiary, or for which any claim
may be made against any Loan Party or any Subsidiary, on account of wages and
employee health and welfare insurance and other benefits, have been paid or
accrued as a liability on the books of the Loan Party or such Subsidiary.

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                    SECTION 3.18. Affiliate Transactions. Except as set forth on
Schedule 3.18, as of the date of this Agreement, there are no existing or
proposed agreements, arrangements, understandings, or transactions between any
Loan Party and any of the officers, members, managers, directors, stockholders,
parents, other interest holders, employees, or Affiliates (other than
Subsidiaries) of any Loan Party or any members of their respective immediate
families, and none of the foregoing Persons are directly or indirectly indebted
to or have any direct or indirect ownership, partnership, or voting interest in
any Affiliate of any Loan Party or any Person with which any Loan Party has a
business relationship or which competes with any Loan Party (except that any
such Persons may own stock in (but not exceeding 2.0% of the outstanding Equity
Interests of) any publicly traded company that may compete with a Loan Party.

ARTICLE IV

Conditions

                    SECTION 4.01. Effective Date. The obligations of the Lenders
to make Loans and of the Issuing Bank to issue Letters of Credit hereunder shall
not become effective until the date on which each of the following conditions is
satisfied (or waived in accordance with Section 9.02):

          (a) Credit Agreement and Loan Documents. The Administrative Agent (or
its counsel) shall have received (i) from each party hereto either (A) a
counterpart of this Agreement signed on behalf of such party or (B) written
evidence satisfactory to the Administrative Agent (which may include facsimile
transmission of a signed signature page of this Agreement) that such party has
signed a counterpart of this Agreement and (ii) duly executed copies of the Loan
Documents (including the Mortgages, the Security Agreement, the Revolving USD
Notes and Revolving Euro Notes) and such other certificates, documents,
instruments and agreements as the Administrative Agent shall reasonably request
in connection with the Transactions, including a written opinion of the Loan
Parties’ counsel, addressed to the Administrative Agent, the Issuing Bank and
the Lenders in substantially the form of Exhibit B.

          (b) Financial Statements and Projections. The Administrative Agent and
the Lenders shall have received (i) satisfactory audited consolidated financial
statements of the Borrower and its Subsidiaries for the two most recent Fiscal
Years of the Borrower ended prior to the Effective Date as to which such
financial statements are available, (ii) satisfactory unaudited interim
consolidated financial statements of the Borrower and its Subsidiaries for each
Fiscal Quarter of the Borrower ended subsequent to the date of the latest
financial statements delivered pursuant to clause (i) of this Section 4.01(b) as
to which such financial statements are available, and (iii) projections
(prepared in accordance with Agreement Accounting Principles on an accrual
basis) for the period beginning as of the Effective Date and ending at the close
of the Fiscal Year of the Borrower thereafter, which projections shall be in
such detail as the Administrative Agent reasonably may request and shall reflect
projected future financial performance by the Borrower and performance and cost
assumptions which are satisfactory in all respects to the Administrative Agent
and the Lenders.

          (c) Closing Certificates; Certified Certificate of Organization; Good
Standing Certificates. The Administrative Agent shall have received (i) a
certificate of each Loan Party, dated the Effective Date and executed by its
Secretary or Assistant Secretary, which shall (A) certify the resolutions of its
Board of Directors, members or other body authorizing the execution, delivery
and performance of the Loan Documents to which it is a party, (B) identify by
name and title and bear the signatures of the Financial Officers and any other
officers of such Loan Party authorized to sign the Loan Documents to which it is
a party, and (C) contain appropriate attachments, including the certificate or
articles of incorporation or organization of each Loan Party certified by the
relevant authority of the jurisdiction of organization of such Loan Party and a
true and correct copy of its by-laws or operating, management or partnership
agreement, and (ii) a good standing certificate for each Loan Party from its
jurisdiction of organization.

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          (d) No Default Certificate. The Administrative Agent shall have
received a certificate, signed by the chief financial officer of each Loan
Party, on the initial Borrowing date (i) stating that no Default has occurred
and is continuing, (ii) stating that the representations and warranties
contained in Article III are true and correct as of such date, and (iii)
certifying any other factual matters as may be reasonably requested by the
Administrative Agent.

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

          (f) Lien Searches. The Administrative Agent shall have received the
results of a recent lien search in each of the jurisdictions where assets of the
Loan Parties are located and where the Loan Parties are located, and such search
shall reveal no liens on any of the assets of the Loan Parties except for liens
permitted by Section 6.02 or discharged on or prior to the Effective Date
pursuant to a pay-off letter or other documentation satisfactory to the
Administrative Agent.

          (g) Pay-Off Letters. The Administrative Agent shall have received
satisfactory pay-off letters for all existing Indebtedness to be repaid from the
proceeds of the initial Borrowing, confirming that all Liens upon any of the
property of the Loan Parties constituting Collateral will be terminated
concurrently with such payment and all letters of credit issued or guaranteed as
part of such Indebtedness shall have been cash collateralized or supported by a
Letter of Credit.

          (h) Funding Account. The Administrative Agent shall have received a
notice setting forth the deposit account(s) of the Borrower (the “Funding
Account”) to which the Lender is authorized by the Borrower to transfer the
proceeds of any Borrowings requested or authorized pursuant to this Agreement.

          (i) Approvals. The Loan Parties shall have obtained, and provided to
the Administrative Agent evidence of, all governmental and third party approvals
necessary or, in the discretion of the Administrative Agent, advisable in
connection with the Transactions and the continuing operations of the Loan
parties and all such approvals shall be in full force and effect.

          (j) Collateral Access Agreements. The Administrative Agent shall have
received each Collateral Access Agreement required to be provided pursuant to
Section 4.13 of each of the Security Agreements.

          (k) Solvency. The Administrative Agent shall have received a solvency
certificate from a Financial Officer of the Borrower.

          (l) Pledged Stock; Stock Powers; Pledged Notes. The Administrative
Agent shall have received (i) the certificates representing the Equity Interests
pledged pursuant to the Security Agreement, together with an undated stock power
for each such certificate executed in blank by a duly authorized officer of the
pledgor thereof and (ii) each promissory note (if any) pledged to the
Administrative Agent pursuant to the Security Agreement endorsed (without
recourse) in blank (or accompanied by an executed transfer form in blank) by the
pledgor thereof.

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          (m) Filings, Registrations and Recordings. Except as provided in
Section 5.13, each document (including any Uniform Commercial Code financing
statement) required by the Collateral Documents or under law or reasonably
requested by the Administrative Agent to be filed, registered or recorded in
order to create in favor of the Administrative Agent, for the benefit of the
Lenders, a perfected Lien on the Collateral described therein, prior and
superior in right to any other Person (other than with respect to Liens
expressly permitted by Section 6.02), shall be in proper form for filing,
registration or recordation.

          (n) Insurance. The Administrative Agent shall have received evidence
of insurance coverage in form, scope, and substance reasonably satisfactory to
the Administrative Agent and otherwise in compliance with the terms of
Section 5.09 and Section 4.12 of the Security Agreement.

          (o) Letter of Credit Application. The Administrative Agent shall have
received a properly completed letter of credit application if the issuance of a
Letter of Credit will be required on the Effective Date. In any Letter of Credit
which may be requested may be a commercial letter of credit, the Borrower shall
have executed the Issuing Bank’s master agreement for the

          (p) Merger of Indian-Martin. The Administrative Agent shall have
received evidence reasonably satisfactory to it that Indian-Martin, Inc. has
been merged into Borrower, with the Borrower being the surviving entity.

           (r) Other Documents. The Administrative Agent shall have received
such other documents as the Administrative Agent, the Issuing Bank, any Lender
or their respective counsel may have reasonably requested.

The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans and of the Issuing
Bank to issue Letters of Credit hereunder shall not become effective unless each
of the foregoing conditions is satisfied (or waived pursuant to Section 9.02) at
or prior to 5:00 p.m., Indianapolis, Indiana time, on the date that is five (5)
Business Days after the date of this Agreement (and, in the event such
conditions are not so satisfied or waived, the Commitments shall terminate at
such time).

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

          (a) The representations and warranties of the Loan Parties set forth
in this Agreement shall be true and correct on and as of the date of such
Borrowing or the date of issuance, amendment, renewal or extension of such
Letter of Credit, as applicable, and if they are not true and correct the
Administrative Agent or the Required Lenders shall have determined not to make
any make a Loan or instructed the Issuing Bank not to issue Letters of Credit as
a result of the fact that such representation or warranty is untrue or
incorrect.

          (b) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such Letter of
Credit, as applicable, no Default shall have occurred and be continuing and the
Required Lenders shall have determined not to make such Borrowing or instructed
the Issuing Bank not to issue such Letter of Credit as a result of such Default.

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          (c) After giving effect to any Revolving USD Borrowing, Revolving USD
Loan Availability is not less than zero.

          (d) After giving effect to any Revolving Euro Borrowing or the
issuance of any Letter of Credit, Revolving Euro Loan Availability is not less
than zero.

          (e) After giving effect to any Revolving Borrowing or the issuance of
any Letter of Credit, Aggregate Availability is not less than zero.

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

                    SECTION 4.03. Post-Closing Conditions. The obligation of
each Lender to make a Loan on the occasion of any Borrowing, and of the Issuing
Bank to issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions on or before such time period set forth
below with respect to such condition, or if no time period is set forth below,
July 31, 2009.

          (a) Owned Property. The Administrative Agent shall have received, with
respect to each Owned Property, each of the following, in form and substance
reasonably satisfactory to the Administrative Agent:

          (i) evidence that a counterpart of each Mortgage of Owned Property has
been recorded in the place necessary, in the Administrative Agent’s judgment, to
create a valid and enforceable first priority Lien in favor of the
Administrative Agent for the benefit of itself and the Lenders;

          (ii) a mortgagee’s title insurance policy in the amount specified by
the Administrative Agreement on the American Land Title Association form of
mortgagee’s title policy (2006 Revision), subject to (if available in the
jurisdiction where such Owned Property is located) an ALTA form 8.1
environmental protection lien endorsement, an ALTA form 9 comprehensive
endorsement, ALTA forms 14 (future advance-priority) and 14.2 (future
advance-letter of credit) endorsement, an ALTA form 18.1 tax parcel endorsement,
an ALTA form 19 contiguity endorsement (if applicable), a survey endorsement and
a utility facility endorsement. The coverage provided by the title insurance
policy shall not be subject to the standard exceptions as to rights of parties
in possession and matters which would be disclosed by survey, easements not
shown by the public records and mechanic’s liens not shown by the public records
(unless the title insurance policy is subject to an endorsement providing for
the deletion of such exceptions upon the receipt by the title insurance company
of a satisfactory ALTA survey), and otherwise the coverage shall be subject to
no exceptions other than (A) easements and use restrictions and encroachments
disclosed by survey which do not materially and adversely affect the value or
marketability of the Owned Property or the usefulness of the Owned Property in
the operations of the Loan Parties and (B) Liens described in the exceptions
enumerated in Section 6.02;

          (iii) a Minimum Standards Detail Land Title Survey together with a
Minimum Standards Detail Certificate prepared by a registered land surveyor or
engineer prepared by a registered land surveyor or engineer. Such survey shall
locate all recorded easements with recording information and contain a statement
as to whether or not the real estate is in a flood plain;

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          (iv) a completed Flood Hazard Determination Form pursuant to the
requirements of the Office of the Comptroller of the Currency and the Federal
Emergency Management Agency;

          (v) the report or reports of a registered engineer or environmental
consultant acceptable to the Administrative Agent, confirming that there are no
material environmental problems associated with the Owned Property. The report
or reports shall be in form satisfactory to the Administrative Agent and shall
include, at a minimum: A) a statement of the results of an examination of all
relevant documents and records concerning ownership and use of the real estate;
B) a statement of the results of an inspection of the real estate, which
inspection shall have included the use of such equipment as is customarily used
by engineers and environmental consultants in connection with the preparation of
“Phase I” environmental reports to detect traces of buried Hazardous Materials
and underground storage tanks and drums and which inspection shall have been
made for the purpose of determining whether all or any part of the real estate
is being used or has been used to store or dispose of any Hazardous Materials in
quantities which are or could be detrimental to the real estate, human health or
the environment or in violation of any laws or regulations, state or federal,
whether the real estate is or has been affected by any Hazardous Materials and
whether the real estate contains or has contained any underground storage tanks
or asbestos of any kind, and a statement of the recommendations of the reporting
engineer or consultant as to such further investigation or tests, if any, as may
be necessary to resolve such issues; C) confirmation that the real estate is not
listed as a known hazardous waste site on any environmental reporting list
maintained by any governmental agency having jurisdiction as to environmental
matters over the real estate, and D) a statement of the professional
qualifications of the engineer or consultant who prepared such report. The
Borrower shall also furnish to the Administrative Agent the supplemental report
(including a Phase II report) of the reporting engineer or consultant as to the
results of such further tests and investigations as may have been recommended in
the initial report; and

          (vi) an Appraisal of such Owned Property in form and substance
satisfactory to the Administrative Agent.

          (b) Confirmation of Pledge. The Administrative Agent shall have
received evidence of the notation in such entity’s corporate records as required
by Mexican law of the pledge by Indian Industries, Inc. to Administrative Agent
of 65% Equity Interests of Harvard California, S. DE R.L. C.V. in form and
substance reasonably satisfactory to the Administrative Agent.

          (c) Control Agreements. The Administrative Agent shall have received
each Deposit Account Control Agreement required to be provided pursuant to
Section 4.14 of each of the Security Agreements.

          (d) Delivery of Pledged Note. No later than 10 days after the
Effective Date, the Administrative Agent shall have received the originally
executed Promissory Note, in the stated principal amount of 250,000.00 GBP,
originally dated September 1, 2007 and reissued on August 31, 2008, executed by
Escalade International, U.K. to the order of Borrower.

          (e) Delivery of Stock Certificates. No later than 5 days after the
Effective Date, the Administrative Agent shall have received the original stock
certificate for 100 shares of the common stock of Escalade Sports Playground,
Inc. owned by Indian Industries, Inc.

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          (f) Intercompany Receivables. By not later than July 31, 2009, or such
later date as may be set by the Administrative Agent by written notice to the
Borrower, unless the Required Lenders shall otherwise agree, the Borrower shall
cause all loans, advances and other receivables owed by a Loan Party to another
Loan Party to be evidenced by a promissory note in form and substance reasonably
satisfactory to the Administrative Agent and pledged to the Administrative Agent
pursuant to the Security Agreement.

ARTICLE V

Affirmative Covenants

                    Until the Commitments have expired or been terminated and
the principal of and interest on each Loan and all fees payable hereunder shall
have been paid in full and all Letters of Credit shall have expired or
terminated and all LC Disbursements shall have been reimbursed, each Loan Party
executing this Agreement covenants and agrees, jointly and severally with all of
the Loan Parties, with the Lenders that:

                    SECTION 5.01. Financial Statements and Other Information.
The Borrower will furnish to the Administrative Agent:

          (a) within 120 days after the end of each Fiscal Year of the Borrower
its audited consolidated and consolidating balance sheet and related statements
of operations, stockholders’ equity and cash flows as of the end of and for such
year, setting forth in each case in comparative form the figures for the
previous Fiscal Year (if available), all reported on by independent public
accountants acceptable to the Administrative Agent (without a “going concern” or
like qualification or exception and without any qualification or exception as to
the scope of such audit) to the effect that such consolidated financial
statements present fairly in all material respects the financial condition and
results of operations of the Borrower and its consolidated Subsidiaries on a
consolidated basis in accordance with Agreement Accounting Principles
consistently applied, accompanied by any management letter prepared by said
accountants;

          (b) within 45 days after the end of each Fiscal Month of the Borrower
that is also the end of a Fiscal Quarter of Borrower and within 30 days after
the end of each other Fiscal Month of the Borrower its consolidated and
consolidating balance sheet and related statements of operations, stockholders’
equity and cash flows as of the end of and for such Fiscal Month and the then
elapsed portion of the Fiscal Year, setting forth in each case in comparative
form the figures for the corresponding period or periods of (or, in the case of
the balance sheet, as of the end of) the previous Fiscal Year (if available),
all certified by a Financial Officer of the Borrower as presenting fairly in all
material respects the financial condition and results of operations of the
Borrower and its consolidated Subsidiaries on a consolidated basis in accordance
with Agreement Accounting Principles consistently applied, subject to normal
year-end audit adjustments and the absence of footnotes;

          (c) concurrently with any delivery of financial statements under
clause (a) or (b) above, a certificate of a Financial Officer of the Borrower in
substantially the form of Exhibit C (i) certifying, in the case of the financial
statements delivered under clause (a) or (b), as presenting fairly in all
material respects the financial condition and results of operations of the
Borrower and its consolidated Subsidiaries on a consolidated basis in accordance
with Agreement Accounting Principles consistently applied, subject to normal
year-end audit adjustments and the absence of footnotes, (ii) certifying as to
whether a Default has occurred and, if a Default has occurred, specifying the
details thereof and any action taken or proposed to be taken with respect
thereto, (iii) setting forth reasonably detailed calculations demonstrating
compliance with Section 5.15 and (iv) stating whether any change in Agreement
Accounting Principles or in the application thereof has occurred since the date
of the audited financial statements referred to in Section 3.04 and, if any such
change has occurred, specifying the effect of such change on the financial
statements accompanying such certificate;

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          (d) concurrently with any delivery of financial statements under
clause (a) above, a certificate of the accounting firm that reported on such
financial statements stating whether they obtained knowledge during the course
of their examination of such financial statements of any Default (which
certificate may be limited to the extent required by accounting rules or
guidelines);

          (e) as soon as available but in any event within 30 days of the end of
each Fiscal Month and at such other times as may be requested by the
Administrative Agent, as of the month then ended, a schedule and aging of the
Borrower’s accounts receivable including a list of all invoices aged by invoice
date and due date (with an explanation of the terms offered);

          (f) as soon as available but in any event within 30 days of the end of
each Fiscal Month and at such other times as may be requested by the
Administrative Agent, as of the month then ended, a schedule and aging of the
Borrower’s accounts payable, together with a summary specifying the name,
address, and balance due for each account debtor;

          (g) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by the
Borrower or any Subsidiary with the Securities and Exchange Commission, or any
Govern-mental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, or distributed by the
Borrower to its share-holders generally, as the case may be;

          (h) as soon as practical but in any event within three (3) Business
Days upon learning of (i) the institution of or any adverse determination in any
litigation, arbitration proceeding or governmental proceeding that could, if
adversely determined, reasonably be expected to result in a Material Adverse
Effect, or (ii) the occurrence of any event which could have a Material Adverse
Effect, written notice thereof describing the same and the steps being taken
with respect thereto; and

          (i) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any Subsidiary, or compliance with the terms of this Agreement, as
the Administrative Agent or any Lender may reasonably request.

                    SECTION 5.02. Notices of Material Events. The Borrower will
furnish to the Administrative Agent prompt written notice of the following:

                    (a) the occurrence of any Default;

          (b) receipt of any notice of any governmental investigation or any
litigation or proceeding commenced or threatened against any Loan Party that (i)
seeks damages in excess of $750,000, (ii) seeks injunctive relief that could, if
adversely determined, reasonably be expected to result in a Material Adverse
Effect, (iii) is asserted or instituted against any Plan, its fiduciaries or its
assets, (iv) alleges criminal misconduct by any Loan Party, (v) alleges the
violation of any law regarding, or seeks remedies in connection with, any
Environmental Laws, (vi) contests any tax, fee, assessment, or other
governmental charge in excess of $500,000, or (vii) involves any product recall;

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          (c) any Lien (other than Permitted Encumbrances) or claim is made or
asserted against any of the Collateral and such Lien or claim, individually or
aggregated with other Liens or claims made or asserted against any of the
Collateral, exceeds $500,000, whether or not covered by insurance;

          (d) any loss, damage, or destruction to the Collateral in the amount
of $500,000 or more, whether or not covered by insurance;

          (e) any and all default notices received under or with respect to any
leased location or public warehouse where Collateral in excess of $100,000 is
located (which shall be delivered within two (2) Business Days after receipt
thereof);

          (f) the fact that a Loan Party has entered into a Swap Agreement or an
amendment to a Swap Agreement, together with copies of all agreements evidencing
such Swap Agreement or amendments thereto (which shall be delivered within four
(4) Business Days);

          (g) the occurrence of any ERISA Event that, alone or together with any
other ERISA Events that have occurred, could reasonably be expected to result in
liability of the Borrower and its Subsidiaries in an aggregate amount exceeding
$500,000; and

          (i) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and if an action plan
is developed for such event, the action taken or proposed to be taken with
respect thereto.

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

                    SECTION 5.04. Payment of Obligations. Each Loan Party will,
and will cause each Subsidiary to, pay or discharge all Material Indebtedness
and all other material liabilities and obligations, including Taxes, before the
same shall become delinquent or in default, except where (a) the validity or
amount thereof is being contested in good faith by appropri­ate proceedings, (b)
such Loan Party or such Subsidiary has set aside on its books adequate reserves
with respect thereto in accordance with Agreement Accounting Principles and (c)
the failure to make payment pending such contest could not reasonably be
expected to result in a Material Adverse Effect.

                    SECTION 5.05. Maintenance of Properties. Each Loan Party
will, and will cause each Subsidiary to, keep and maintain all property material
to the conduct of its business in good working order and condition, ordinary
wear and tear excepted.

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                    SECTION 5.06. Books and Records; Inspection Rights. Each
Loan Party will, and will cause each Subsidiary to, (i) keep proper books of
record and account in which full, true and correct entries are made of all
dealings and transactions in relation to its business and activities and (ii)
permit any representatives designated by the Administrative Agent or any Lender
(including employees of the Administrative Agent, any Lender or any consultants,
accountants, lawyers and appraisers retained by the Administrative Agent), upon
reasonable prior notice during normal business hours, to visit and inspect its
properties, to examine and make extracts from its books and records, including
environmental assessment reports and Phase I or Phase II studies, and to discuss
its affairs, finances and condition with its officers and independent
accountants, all at such reasonable times and as often as reasonably requested.
After the occurrence and during the continuance of any Event of Default, each
Loan Party shall provide the Administrative Agent and each Lender with access to
its suppliers. The Loan Parties acknowledge that the Administrative Agent, after
exercising its rights of inspection, may prepare and distribute to the Lenders
certain Reports pertaining to the Loan Parties’ assets for internal use by the
Administrative Agent and the Lenders.

                    SECTION 5.07. Compliance with Laws. Each Loan Party will,
and will cause each Subsidiary to, comply with all Requirements of Law
applicable to it or its property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.

                    SECTION 5.08. Use of Proceeds and Letters of Credit. The
proceeds of the Revolving Loans will be used only (i) to repay the indebtedness,
liability and obligations on the Effective Date of the Borrower under credit
facilities with Chase; and (ii) to supplement working capital and for other
general business purposes (not otherwise prohibited by this Agreement). No part
of the proceeds of any Loan and no Letter of Credit will be used, whether
directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations T, U and X. Letters of Credit
will be used only to support general business purposes (not otherwise provided
by this Agreement).

                    SECTION 5.09. Insurance. Each Loan Party will, and will
cause each Subsidiary to, maintain with financially sound and reputable carriers
having a financial strength rating of at least A+ by A.M. Best Company (a)
insurance in such amounts (with no greater risk retention) and against such
risks (including loss or damage by fire and loss in transit; theft, burglary,
pilferage, larceny, embezzlement, and other criminal activities; business
interruption; and general liability) and such other hazards, as is customarily
maintained by companies of established repute engaged in the same or similar
businesses operating in the same or similar locations and (b) all insurance
required pursuant to the Collateral Documents. All such insurance shall be in
amounts, cover such assets and be under policies acceptable to the
Administrative Agent in its Permitted Discretion. Unless otherwise notified by
the Administrative Agent in writing, each Loan Party shall maintain at a minimum
insurance of the types and in the amounts specified in Exhibit G. The Borrower
will furnish to the Lenders, upon request of the Administrative Agent,
information in reasonable detail as to the insurance so maintained.

                    SECTION 5.10. Casualty and Condemnation. The Borrower (a)
will furnish to the Administrative Agent and the Lenders prompt written notice
of any casualty or other insured damage to any material portion of the
Collateral or the commencement of any action or proceeding for the taking of any
material portion of the Collateral or interest therein under power of eminent
domain or by condemnation or similar proceeding and (b) will ensure that the Net
Proceeds of any such event (whether in the form of insurance proceeds,
condemnation awards or otherwise) are collected and applied in accordance with
the applicable provisions of this Agreement and the Collateral Documents

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                    SECTION 5.11. Appraisals. At such times specified below, the
Borrower and the Subsidiaries will provide the Administrative Agent with
appraisals or updates thereof of their Inventory, Equipment and real property
from an appraiser selected and engaged by the Administrative Agent, and prepared
on a basis satisfactory to the Administrative Agent, such appraisals and updates
to include, without limitation, information required by applicable law and
regulations. At the request of the Administrative Agent, the Borrower and the
Subsidiaries shall provide such appraisals and updates (a) no more than once per
year, if no Default exists, and (b) at anytime the Administrative Agent
requests, if a Default has occurred and is continuing.

                    SECTION 5.12. Depository Banks. The Loan Parties and their
Subsidiaries will maintain the Administrative Agent as its principal depository
bank, including for the maintenance of operating, administrative, cash
management, collection activity, and other deposit accounts for the conduct of
their business.

                    SECTION 5.13. Additional Collateral; Further Assurances.

                    (a) Subject to applicable law, each Loan Party shall cause
each of its domestic Subsidiaries formed or acquired after the date of this
Agreement in accordance with the terms of this Agreement (any such formation or
acquisition being prohibited by Section 6.13 of this Agreement without the prior
written consent of the Administrative Agent) to become a Loan Party by executing
the Joinder Agreement set forth as Exhibit D hereto (the “Joinder Agreement”).
Upon execution and delivery thereof, each such Person (i) shall automatically
become a Loan Guarantor hereunder and thereupon shall have all of the rights,
benefits, duties, and obligations in such capacity under the Loan Documents and
(ii) will grant Liens to the Administrative Agent, for the benefit of the
Administrative Agent and the Lenders, in any property of such Loan Party which
constitutes Collateral, including any parcel of real property located in the
U.S. owned by any Loan Party.

                    (b) Each Loan Party will cause (i) 100% of the issued and
outstanding Equity Interests of each of its domestic Subsidiaries and (ii) 65%
(or such greater percentage that, due to a change in applicable law after the
date hereof, (1) could not reasonably be expected to cause the undistributed
earnings of such foreign Subsidiary as determined for U.S. federal income tax
purposes to be treated as a deemed dividend to such foreign Subsidiary’s U.S.
parent and (2) could not reasonably be expected to cause any material adverse
tax consequences) of the issued and outstanding Equity Interests entitled to
vote (within the meaning of Treas. Reg. Section 1.956-2(c)(2)) and 100% of the
issued and outstanding Equity Interests not entitled to vote (within the meaning
of Treas. Reg. Section 1.956-2(c)(2) in each foreign Subsidiary directly owned
by a Loan Party to be subject at all times to a first priority, perfected Lien
in favor of the Administrative Agent pursuant to the terms and conditions of the
Loan Documents or other security documents as the Administrative Agent shall
reasonably request. Notwithstanding the foregoing, at any time after an Event of
Default has occurred and is continuing, each Loan Party will, upon the request
of the Administrative Agent, cause each foreign Subsidiary to become a Loan
Party and a Loan Guarantor and to grant Liens to the Administrative Agent on its
assets and have the balance of its stock pledged to the Administrative Agent.

                    (c) Without limiting the foregoing, each Loan Party will,
and will cause each Subsidiary to, execute and deliver, or cause to be executed
and delivered, to the Administrative Agent such documents, agreements and
instruments, and will take or cause to be taken such further actions (including
the filing and recording of financing statements, fixture filings, mortgages,
deeds of trust and other documents and such other actions or deliveries of the
type required by Section 4.01, as applicable), which may be required by law or
which the Administrative Agent may, from time to time, reasonably request to
carry out the terms and conditions of this Agreement and the other Loan
Documents and to ensure perfection and priority of the Liens created or intended
to be created by the Collateral Documents, all at the expense of the Loan
Parties.

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                    (d) If any material assets (including any real property or
improvements thereto or any interest therein) are acquired by any Loan Party
after the Effective Date (other than assets constituting Collateral under the
Security Agreement that become subject to the Lien in favor of the Security
Agreement upon acquisition thereof), the Borrower will notify the Administrative
Agent and the Lenders thereof, and, if requested by the Administrative Agent or
the Required Lenders, the Borrower will cause such assets to be subjected to a
Lien securing the Secured Obligations and will take, and cause the Loan Parties
to take, such actions as shall be necessary or reasonably requested by the
Administrative Agent to grant and perfect such Liens, including actions
described in paragraph (c) of this Section, all at the expense of the Loan
Parties.

                    (e) The Administrative Agent and the Lenders are not
requiring that the Loan Parties deliver certificates of title for all titled
motor vehicles or that the Lien in favor of the Administrative Agent in such
motor vehicles granted pursuant to the Security Agreement be perfected by having
such Lien noted on such certificates of title as a condition to the closing of
the Transaction. However, if the Required Lenders direct the Administrative
Agent to request that the Loan Parties deliver all original certificates of
title for all motor vehicles owned by the Loan Parties, the Loan Parties shall
deliver all such original certificates of title to the Administrative Agent
immediately upon demand and shall provide all assistance required by the
Administrative Agent to perfect its Lien on the motor vehicles owned by the Loan
Parties at the Loan Parties’ cost and expense.

                    SECTION 5.14. Hazardous Materials. Within thirty (30)
Business Days after request by the Administrative Agent, each Loan Party shall
provide to the Administrative Agent written information regarding all Hazardous
Materials that are used, generated, transported, stored or disposed of by the
Loan Party, in reportable quantities. If any Loan Party should commence the use,
treatment, transportation, generation, storage, or disposal of any Hazardous
Substance in reportable quantities in its operations in addition to those noted
in such information, such Loan Party shall immediately notify the Administrative
Agent of the commencement of such activity with respect to each such Hazardous
Substance within thirty (30) Business Days of commencing such activity. Each
Loan Party shall cause any Hazardous Materials which are now or may hereafter be
used or generated in the operations of the Loan Party in reportable quantities
to be accounted for and disposed of in compliance with all Environmental Laws
and other applicable federal, state and local laws and regulations. No Loan
Party shall allow or permit to continue the release or threatened release of any
Hazardous Materials on any premises owned or occupied by or under lease to the
Loan Party. Each Loan Party shall notify the Administrative Agent within five
(5) Business Days after obtaining knowledge of any of the events described below
and shall, simultaneously with providing such notice, provide the Administrative
Agent with copies of any correspondence regarding such event:

 

 

 

 

(i)

any premises which have at any time been owned or occupied by or have been under
lease to the Loan Party are the subject of an environmental investigation by any
federal, state or local governmental agency having jurisdiction over the
regulation of any Hazardous Materials, the purpose of which investigation is to
quantify the levels of Hazardous Materials located on such premises;

 

 

 

 

(ii)

the Loan Party has been named or is threatened to be named as a party
responsible for the possible contamination of any real property or ground water
with Hazardous Materials, including, but not limited to the contamination of
past and present waste disposal sites; or

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(iii)

any notice or claim to the effect that the Borrower or any of its Subsidiaries
is or may be liable to any Person as a result of the release by the Borrower,
any of its Subsidiaries, or any other Person of any toxic or hazardous waste or
substance into the environment, and any notice alleging any violation of any
federal, state or local environmental, health or safety law or regulation by the
Borrower or any of its Subsidiaries, which, in either case, could reasonably be
expected to have a Material Adverse Effect.

If any Loan Party is notified of any event described in (i) or (ii) above, such
Loan Party shall within thirty (30) Business Days of such notice engage a firm
or firms of engineers or environmental consultants appropriately qualified to
determine as quickly as practical the extent of contamination and the potential
financial liability of the Loan Party with respect thereto, and the
Administrative Agent shall be provided with a copy of any report prepared by
such firm or by any governmental agency as to such matters as soon as any such
report becomes available to the Loan Party, and the Loan Party shall immediately
establish reserves in the amount of the potential financial liability of the
Loan Party identified by such environmental consultants or engineers. The
selection of any engineers or environmental consultants engaged pursuant to the
requirements of this Section 5.14 shall be subject to the approval of the
Administrative Agent, which approval shall not be unreasonably withheld. Each
Loan Party shall provide an adequate reserve for the payment of all potential
financial liability not covered by insurance upon the occurrence of any event
described in this Section 5.14.

                    SECTION 5.15. Financial Covenants.

                    (a) Minimum EBITDA Covenants.

 

 

 

 

(i)

Borrower and its Subsidiaries shall achieve Consolidated EBITDA for each EBITDA
Test Period equal to not less than 85% of the aggregate Projected Consolidated
EBITDA of the Borrower and its Subsidiaries for each such EBITDA Test Period.

 

 

 

 

(ii)

In addition, as of the close of each Fiscal Month which closes during the term
of the Loans, beginning with the third Fiscal Month in Borrower’s 2009 Fiscal
Year, Borrower and its Subsidiaries shall achieve Consolidated EBITDA for the
three consecutive Fiscal Months which end at the close of such Fiscal Month of
not less than 50% of the sum of the Projected Consolidated EBITDA amounts for
such three consecutive Fiscal Months.

                    (b) Maximum Debt to Tangible Net Worth Ratio. Borrower and
its Subsidiaries shall maintain at all times a ratio of Consolidated Debt to
Consolidated Tangible Net Worth as of the close of each Fiscal Month of not more
than 2.25 to 1.00.

ARTICLE VI

Negative Covenants

                    Until the Commitments have expired or terminated and the
principal of and interest on each Loan and all fees, expenses and other amounts
payable under any Loan Document have been paid in full and all Letters of Credit
have expired or terminated and all LC Disbursements shall have been reimbursed,
the Loan Parties covenant and agree, jointly and severally, with the Lenders
that:

                    SECTION 6.01. Indebtedness. No Loan Party will, nor will it
permit any Subsidiary to, create, incur or suffer to exist any Indebtedness,
except:

                    (a) the Secured Obligations;

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          (b) Indebtedness existing on the date hereof and set forth in
Schedule 6.01;

          (c) Guarantees by any Loan Party of Indebtedness of any other Loan
Party, provided that the Indebtedness so Guaranteed is permitted by this
Section 6.01 or Guarantees by endorsement of instruments for deposit made in the
ordinary course of business;

          (d) purchase money Indebtedness incurred in connection with the
purchase of any Equipment; provided that, the amount of such purchase money
Indebtedness shall be limited to an amount not in excess of the purchase price
of such Equipment and the aggregate of all such purchase money Indebtedness
outstanding at any time shall not exceed the Purchase Money Indebtedness Cap at
such time;

          (e) Indebtedness which represents an extension, refinancing, or
renewal of any of the Indebtedness described in clauses (b), (d) and (g) hereof;
provided that, (i) the principal amount or interest rate of such Indebtedness is
not increased, (ii) any Liens securing such Indebtedness are not extended to any
additional property of any Loan Party, (iii) no Loan Party that is not
originally obligated with respect to repayment of such Indebtedness is required
to become obligated with respect thereto, (iv) such extension, refinancing or
renewal does not result in a shortening of the average weighted maturity of the
Indebtedness so extended, refinanced or renewed, (v) the terms of any such
extension, refinancing, or renewal are not less favorable to the obligor
thereunder than the original terms of such Indebtedness and (iv) if the
Indebtedness that is refinanced, renewed, or extended was subordinated in right
of payment to the Secured Obligations, then the terms and conditions of the
refinancing, renewal, or extension Indebtedness must include subordination terms
and conditions that are at least as favorable to the Administrative Agent and
the Lenders as those that were applicable to the refinanced, renewed, or
extended Indebtedness;

          (f) other unsecured Indebtedness in an aggregate principal amount not
exceeding $500,000 at any time.

          (g) Indebtedness of any Loan Party to any other Loan Party; and

          (h) Indebtedness of any Person that becomes a Subsidiary with the
consent of the Administrative Agent after the date hereof pursuant to Section
6.13; provided that (i) such Indebtedness exists at the time such Person becomes
a Subsidiary and is not created in contemplation of or in connection with such
Person becoming a Subsidiary and (ii) the aggregate principal amount of
Indebtedness of all such Subsidiaries permitted by this clause (i) shall not
exceed $100,000 at any time outstanding.

                    SECTION 6.02. Liens. No Loan Party will, nor will it permit
any Subsidiary to, create, incur, assume or permit to exist any Lien on any
property or asset now owned or hereafter acquired by it, or assign or sell any
income or revenues (including accounts receivable) or rights in respect of any
thereof, except:

          (a) Liens in favor of the Administrative Agent or any Lender created
pursuant to any Loan Document;

          (b) Permitted Encumbrances;

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          (c) any Lien on any property or asset of any Loan Party existing on
the date hereof and set forth in Schedule 6.02; provided that (i) such Lien
shall not apply to any other property or asset of the Borrower or Subsidiary and
(ii) such Lien shall secure only those obligations which it secures on the date
hereof;

          (d) Liens securing Indebtedness permitted by Section 6.01(d), but only
to the extent the Liens attach only to the Equipment being financed pursuant to
the transaction in which such Indebtedness was incurred, and identifiable cash
proceeds thereof

          (e) any Lien existing on any property or asset (other than Accounts
and Inventory) prior to the acquisition thereof by the Borrower or any
Subsidiary or existing on any property or asset (other than Accounts and
Inventory) of any Person that becomes a Loan Party after the date hereof prior
to the time such Person becomes a Loan Party; provided that (i) such Lien is not
created in contemplation of or in connection with such acquisition or such
Person becoming a Loan Party, as the case may be, (ii) such Lien shall not apply
to any other property or assets of the Loan Party and (iii) such Lien shall
secure only those obligations which it secures on the date of such acquisition
or the date such Person becomes a Loan Party, as the case may be;

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

          (g) Liens granted by a foreign Subsidiary that is not a Loan Party in
favor of the Borrower or another Loan Party in respect of Indebtedness owed by
such foreign Subsidiary.

                    SECTION 6.03. Fundamental Changes. (a) No Loan Party will,
nor will it permit any Subsidiary to, merge into or consolidate with any other
Person, or permit any other Person to merge into or consolidate with it, or
liquidate or dissolve, except that, if at the time thereof and immediately after
giving effect thereto no Event of Default shall have occurred and be continuing
(i) any Subsidiary of the Borrower may merge into the Borrower in a transaction
in which the Borrower is the surviving corporation, (ii) any Loan Party (other
than the Borrower) may merge into any Loan Party in a transaction in which the
surviving entity is a Loan Party and (iii) any Subsidiary that is not a Loan
Party may liquidate or dissolve if the Borrower which owns such Subsidiary
determines in good faith that such liquidation or dissolution is in the best
interests of the Borrower and is not materially disadvantageous to the Lenders;
provided that any such merger involving a Person that is not a wholly owned
Subsidiary immediately prior to such merger shall not be permitted unless also
permitted by Section 6.04.

                    (b) No Loan Party will, nor will it permit any of its
Subsidiaries to, engage to any material extent in any business other than
businesses of the type conducted by the Borrower and its Subsidiaries on the
date of execution of this Agreement and businesses reasonably related thereto.

                    (c) No Loan Party will change its Fiscal Year without the
advance written consent of the Administrative Agent.

                    (d) No Loan Party shall (i) change its name as it appears in
official filings in the state of its incorporation or organization, (ii) change
its chief executive office, principal place of business, mailing address,
corporate offices or warehouses or locations at which Collateral is held or
stored, or the location of its records concerning the Collateral as set forth in
the Collateral Documents, (iii) change the type of entity that it is, or (iv)
change its organization identification number, if any, issued by its state of
incorporation or other organization, (v) change its state of incorporation or
organization, in each case, unless the Administrative Agent shall have received
at least thirty days prior written notice of such change and the Administrative
Agent shall have acknowledged in writing that either (1) the Administrative
Agent has determined, in its Permitted Discretion, that such change will not
adversely affect the validity, perfection or priority of any Lien in favor of
the Administrative Agent or any Lender in the Collateral, or (2) any reasonable
action requested by the Administrative Agent in connection therewith has been
completed or taken (including any action to continue the perfection of any Liens
in favor of the Administrative Agent or any Lender in any Collateral), provided
that, any new location shall be in the continental U.S.

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                    SECTION 6.04. Investments, Loans, Advances, Guarantees and
Acquisitions. No Loan Party will, nor will it permit any Subsidiary to,
purchase, hold or acquire (including pursuant to any merger with any Person that
was not a Loan Party and a wholly owned Subsidiary prior to such merger) any
capital stock, evidences of indebtedness or other securities (including any
option, warrant or other right to acquire any of the foregoing) of, make or
permit to exist any loans or advances to, Guarantee any obligations of, or make
or permit to exist any investment or any other interest in, any other Person, or
make any Acquisition, except:

          (a) Permitted Investments, subject to control agreements in favor of
the Administrative Agent for the benefit of the Lenders or otherwise subject to
a perfected security interest in favor of the Administrative Agent for the
benefit of the Lenders;

          (b) investments and loans in existence on the date of this Agreement
and described in Schedule 6.04;

          (c) investments by the Loan Parties existing on the date hereof in the
capital stock of their Subsidiaries; provided that any such Equity Interests
held by a Loan Party shall be pledged pursuant to the Security Agreement
(subject to the limitations applicable to common stock of a foreign Subsidiary
referred to in Section 5.12);

          (d) loans or advances made by a Loan Party to any other Loan Party
permitted by Section 6.01;

          (e) Guarantees constituting Indebtedness permitted by Section 6.01;

          (f) loans or advances made by a Loan Party to its employees on an
arms-length basis in the ordinary course of business consistent with past
practices for travel and entertainment expenses, relocation costs and similar
purposes;

          (g) subject to Sections 4.2(a) and 4.4 of the Security Agreement,
notes payable, or stock or other securities issued by Account Debtors to a Loan
Party pursuant to negotiated agreements with respect to settlement of such
Account Debtor’s Accounts in the ordinary course of business, consistent with
past practices;

          (h) investments in the form of Swap Agreements permitted by
Section 6.07;

          (i) investments of any Person existing at the time such Person becomes
a Subsidiary of the Borrower or consolidates or merges with the Borrower or any
of the Subsidiaries (including in connection with a permitted acquisition) so
long as such investments were not made in contemplation of such Person becoming
a Subsidiary or of such merger;

          (j) investments received in connection with the dispositions of assets
permitted by Section 6.05;

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          (k) investments constituting deposits described in clauses (c) and (d)
of the definition of the term “Permitted Encumbrances”;

          (l) extensions of credit or credit accommodations to customers or
vendors made by the Borrower or a Subsidiary in the ordinary course of its
business as conducted on the Effective Date;

          (m) other investments, loans, advances and guarantee and recourse
obligations up to an aggregate amount not exceeding $250,000 outstanding at any
time; and

          (n) investments of Escalade Insurance, that (i) are investments of the
same type and character as those investments of Escalade Insurance that exist on
the Effective Date, and (ii) comply with the investment policies of Escalade
Insurance that exist on the Effective Date, and (iii) comply with all laws
regulating the investments of Escalade Insurance; provided, however, no later
than September 30, 2009, all investments of Escalade Insurance shall be at least
NAIC Class 1 and Class 2 investments.

                    SECTION 6.05. Asset Sales. No Loan Party will, nor will it
permit any Subsidiary to, sell, transfer, lease or otherwise dispose of any
asset, including any Equity Interest owned by it, nor will the Borrower permit
any Subsidiary to issue any additional Equity Interest in such Subsidiary (other
than to another Borrower or another Subsidiary in compliance with Section 6.04),
except:

          (a) sales, transfers and dispositions of (i) Inventory in the ordinary
course of business and (ii) used, obsolete, worn out or surplus Equipment or
property in the ordinary course of business;

          (b) sales, transfers and dispositions to the Borrower or any
Subsidiary, provided that any such sales, transfers or dispositions involving a
Subsidiary that is not a Loan Party shall be made in compliance with
Section 6.09;

          (c) sales, transfers and dispositions of accounts receivable in
connection with the compromise, settlement or collection thereof;

          (d) sales, transfers and dispositions of investments permitted by
clauses (i) and (k) of Section 6.04;

          (e) sale and leaseback transactions permitted by Section 6.06;

          (f) dispositions resulting from any casualty or other insured damage
to, or any taking under power of eminent domain or by condemnation or similar
proceeding of, any property or asset of the Borrower or any Subsidiary; and

          (g) sales, transfers and other dispositions of assets (other than
Equity Interests in a Subsidiary unless all Equity Interests in such Subsidiary
are sold) that are not permitted by any other paragraph of this Section,
provided that the aggregate fair market value of all assets sold, transferred or
otherwise disposed of in reliance upon this paragraph (g) shall not exceed
$250,000 during any Fiscal Year of the Borrower;

provided that all sales, transfers, leases and other dispositions permitted
hereby (other than those permitted by paragraphs (b) and (f) above) shall be
made for fair value and for at least 75% cash consideration.

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                    SECTION 6.06. Sale and Leaseback Transactions. No Loan Party
will, nor will it permit any Subsidiary to, enter into any arrangement, directly
or indirectly, whereby it shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereafter acquired, and
thereafter rent or lease such property or other property that it intends to use
for substantially the same purpose or purposes as the property sold or
transferred, except for any such sale of any fixed or capital assets by the
Borrower or any Subsidiary that is made for cash consideration in an amount not
less than the fair value of such fixed or capital asset and is consummated
within 90 days after the Borrower or such Subsidiary acquires or completes the
construction of such fixed or capital asset.

                    SECTION 6.07. Swap Agreements. No Loan Party will, nor will
it permit any Subsidiary to, enter into any Swap Agreement, except (a) Swap
Agreements entered into to hedge or mitigate risks to which the Borrower or any
Subsidiary has actual exposure (other than those in respect of Equity Interests
of the Borrower or any of its Subsidiaries), and (b) Swap Agreements entered
into in order to effectively cap, collar or exchange interest rates (from fixed
to floating rates, from one floating rate to another floating rate or otherwise)
with respect to any interest-bearing liability or investment of the Borrower or
any Subsidiary.

                    SECTION 6.08. Restricted Payments; Certain Payments of
Indebtedness. (a) No Loan Party will, nor will it permit any Subsidiary to,
declare or make, or agree to pay or make, directly or indirectly, any Restricted
Payment, or enter into any transaction that has a substantially similar effect
or incur any obligation (contingent or otherwise) to do so, except (i) the
Borrower may declare and pay dividends with respect to its common stock payable
solely in additional shares of its common stock, and, with respect to its
preferred stock, payable solely in additional shares of such preferred stock or
in shares of its common stock, (ii) so long as there exists no Event of Default,
the Borrower may, to the extent required by law, repurchase fractional shares of
Borrower’s Equity Interests up to an aggregate repurchase total for all
fractional shares of repurchased of $500,000, (iii) the Borrower may issue its
common stock pursuant to the Borrower’s stock option plan existing on the
Effective Date, and (iv) so long as there exists no Event of Default, the
Borrower may repurchase shares of Borrower’s Equity Interests up to an aggregate
repurchase total for all shares repurchased of $50,000.

                    (b) No Loan Party will, nor will it permit any Subsidiary
to, make or agree to pay or make, directly or indirectly, any payment or other
distribution (whether in cash, securities or other property) of or in respect of
principal of or interest on any Indebtedness, or any payment or other
distribution (whether in cash, securities or other property), including any
sinking fund or similar deposit, on account of the purchase, redemption,
retirement, acquisition, cancellation or termination of any Indebtedness or to
enter into any transaction that has a substantially similar effect, except:

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

          (ii) payment of regularly scheduled interest and principal payments as
and when due in respect of any Indebtedness, other than payments in respect of
the Subordinated Indebtedness prohibited by the subordination provisions
thereof;

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

          (iv) payment of secured Indebtedness that becomes due as a result of
the voluntary sale or transfer of the property or assets securing such
Indebtedness.

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                    SECTION 6.09. Transactions with Affiliates. No Loan Party
will, nor will it permit any Subsidiary to, sell, lease or otherwise transfer
any property or assets to, or purchase, lease or otherwise acquire any property
or assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) transactions that (i) are in the ordinary course of
business and (ii) are at prices and on terms and conditions not less favorable
to the Borrower or such Subsidiary than could be obtained on an arm’s-length
basis from unrelated third parties, (b) transactions between or among the
Borrower and any Subsidiary that is a Loan Party not involving any other
Affiliate, (c) any investment permitted by Sections 6.04(c) or 6.04(d), (d) any
Indebtedness permitted under Section 6.01(c), (e) any Restricted Payment
permitted by Section 6.08, (f) loans or advances to employees permitted under
Section 6.04, (g) the payment of reasonable fees to directors of the Borrower or
any Subsidiary who are not employees of the Borrower or Subsidiary, and
compensation and employee benefit arrangements paid to, and indemnities provided
for the benefit of, directors, officers or employees of the Borrower or its
Subsidiaries in the ordinary course of business and (h) any issuances of
securities or other payments, awards or grants in cash, securities or otherwise
pursuant to, or the funding of, employment agreements, stock options and stock
ownership plans approved by the Borrower’s board of directors. Notwithstanding
the foregoing, no Loan Party shall, nor shall it permit any Subsidiary to, make
any payment, dividend or transfer any money to Escalade Insurance except that
the Loan Parties and their Subsidiaries may pay insurance premiums which are due
and payable to Escalade Insurance for insurance provided in the ordinary course
of business by or through Escalade Insurance to the Loan Parties or their
Subsidiaries.

                    SECTION 6.10. Restrictive Agreements. No Loan Party will,
nor will it permit any Subsidiary to, directly or indirectly, enter into, incur
or permit to exist any agreement or other arrangement that prohibits, restricts
or imposes any condition upon (a) the ability of such Loan Party or any of its
Subsidiaries to create, incur or permit to exist any Lien upon any of its
property or assets, or (b) the ability of any Subsidiary to pay dividends or
other distributions with respect to any shares of its capital stock or to make
or repay loans or advances to the Borrower or any other Subsidiary or to
Guarantee Indebtedness of the Borrower or any other Subsidiary; provided that
(i) the foregoing shall not apply to restrictions and conditions imposed by law
or by any Loan Document, (ii) the foregoing shall not apply to restrictions and
conditions existing on the date hereof identified on Schedule 6.10 (but shall
apply to any extension or renewal of, or any amendment or modification expanding
the scope of, any such restriction or condition), (iii) the foregoing shall not
apply to customary restrictions and conditions contained in agreements relating
to the sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder, (iv) clause (a) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness and (v) clause
(a) of the foregoing shall not apply to customary provisions in leases
restricting the assignment thereof.

                    SECTION 6.11. Amendment of Material Documents. No Loan Party
will, nor will it permit any Subsidiary to, amend, modify or waive any of its
rights under (a) agreement relating to any Subordinated Indebtedness, (b) its
certificate of incorporation, by-laws, operating, management or partnership
agreement or other organizational documents, or (c) to the extent any such
amendment, modification or waiver would be adverse to the Lenders.

                    SECTION 6.12. Capital Expenditures. The Loan Parties shall
not incur or make Capital Expenditures during Fiscal Year 2009 of the Borrower
in an aggregate amount exceeding $2,500,000. The Loan Parties shall not incur or
make Capital Expenditures during the first five Fiscal Months of the 2010 Fiscal
Year of the Borrower in an aggregate amount exceeding $500,000.

                    SECTION 6.13. Subsidiaries. No Loan Party shall have or
acquire any Subsidiary without the prior written consent of the Administrative
Agent, which consent shall be given or withheld in the Administrative Agent’s
sole discretion. At a minimum, any consent to the formation of a Subsidiary will
be conditioned upon full compliance with Section 5.13 of this Agreement.

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ARTICLE VII

Events of Default

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

          (a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepay­ment thereof or otherwise, and such failure shall continue unremedied
for a period of three (3) Business Days;

          (b) the Borrower shall fail to pay any interest on any Loan or any fee
or any other amount (other than an amount referred to in clause (a) of this
Article) payable under this Agreement, when and as the same shall become due and
payable, and such failure shall continue unremedied for a period of three (3)
Business Days;

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

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

          (e) any Loan Party shall fail to observe or perform any covenant,
condition or agree­ment contained in this Agreement (other than those which
constitute a default under another Section of this Article), and such failure
shall continue unremedied for a period of (i) 5 days after the earlier of any
Loan Party’s knowledge of such breach or notice thereof from the Administrative
Agent (which notice will be given at the request of any Lender) if such breach
relates to terms or provisions of Section 5.09 of this Agreement or (ii) 15 days
after the earlier of any Loan Party’s knowledge of such breach or notice thereof
from the Administrative Agent (which notice will be given at the request of any
Lender) if such breach relates to terms or provisions of any other Section of
this Agreement;

          (f) any Loan Party or any Subsidiary shall fail to make any payment
(whether of principal or interest and regardless of amount) in respect of any
Material Indebtedness, when and as the same shall become due and payable after
the expiration of any applicable notice and cure period;

          (g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables or
permits (with or without the giving of notice, the lapse of time or both) the
holder or holders of any Material Indebtedness or any trustee or agent on its or
their behalf to cause any Material Indebtedness to become due, or to require the
prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled
maturity; provided that this clause (g) shall not apply to secured Indebtedness
that becomes due as a result of the voluntary sale or transfer of the property
or assets securing such Indebtedness;

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          (h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief
in respect of a Loan Party or any Subsidiary of any Loan Party or its debts, or
of a substantial part of its assets, under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect
or (ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for any Loan Party or any Subsidiary of any Loan
Party or for a substantial part of its assets, and, in any such case, such
proceeding or petition shall continue undismissed for 60 days or an order or
decree approving or ordering any of the foregoing shall be entered;

          (i) any Loan Party or any Subsidiary of any Loan Party shall
(i) voluntarily commence any proceeding or file any petition seeking
liquidation, reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect,
(ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or petition described in clause (h) of this
Article, (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for such Loan Party, or
Subsidiary of any Loan Party or for a substan­tial part of its assets, (iv) file
an answer admit­ting the material allegations of a petition filed against it in
any such proceeding, (v) make a general assignment for the benefit of creditors
or (vi) take any action for the purpose of effecting any of the fore­going;

          (j) any Loan Party or any Subsidiary of any Loan Party shall become
unable, admit in writing its inability or fail generally to pay its debts as
they become due;

          (k) one or more judgments for the payment of money in an aggregate
amount in excess of $100,000 shall be rendered against any Loan Party or any
Subsidiary of any Loan Party or any combination thereof and the same shall
remain undischarged for a period of 30 consecutive days during which execution
shall not be effectively stayed, or any action shall be legally taken by a
judgment creditor with a judgment in excess of $20,000 to attach or levy upon
any assets of any Loan Party or any Subsidiary of any Loan Party to enforce any
such judgment or any Loan Party or any Subsidiary of any Loan Party shall fail
within 30 days to discharge one or more non-monetary judgments or orders which,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, which judgments or orders, in any such case, are not
stayed on appeal or otherwise being appropriately contested in good faith by
proper proceedings diligently pursued;

          (l) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other ERISA Events that have
occurred, could reasonably be expected to result in a Material Adverse Effect;

          (m) a Change in Control shall have occurred;

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

          (o) the Loan Guaranty shall fail to remain in full force or effect or
any action shall be taken to discontinue or to assert the invalidity or
unenforceability of the Loan Guaranty or to terminate the Loan Guaranty with
respect to obligations arising after notice of such termination, or any Loan
Guarantor shall fail to comply with any of the terms or provisions of the Loan
Guaranty to which it is a party, or any Loan Guarantor shall deny that it has
any further liability under the Loan Guaranty to which it is a party, or shall
give notice to such effect;

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          (p) any Collateral Document shall for any reason fail to create a
valid and perfected first priority security interest in any Collateral purported
to be covered thereby, except as permitted by the terms of any Collateral
Document, or any Collateral Document shall fail to remain in full force or
effect or any action shall be taken to discontinue or to assert the invalidity
or unenforceability of any Collateral Document, or any Loan Party shall fail to
comply with any of the terms or provisions of any Collateral Document;

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

          (r) the Loan Parties shall fail to deliver to the Administrative Agent
any item required to be delivered by Section 4.03 of this Agreement within the
time period(s) set forth in Section 4.03;

then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times: (i) terminate the
Commitments, and thereupon the Commitments shall terminate immediately, and
(ii) declare the Loans then out­standing to be due and payable in whole (or in
part, in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of
the Loans so declared to be due and payable, together with accrued interest
thereon and all fees and other obligations of the Borrower accrued hereunder,
shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower; and
in case of any event with respect to the Borrower described in clause (h) or (i)
of this Article, the Commitments shall automatically terminate and the principal
of the Loans then outstanding, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall
automatically become due and payable, without present­ment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower. Upon
the occurrence and the continuance of an Event of Default, the Administrative
Agent may, and at the request of the Required Lenders shall, exercise any rights
and remedies provided to the Administrative Agent under the Loan Documents or at
law or equity, including all remedies provided under the UCC.

ARTICLE VIII

The Administrative Agent

                    Each of the Lenders and the Issuing Bank hereby irrevocably
appoints the Administrative Agent as its agent and authorizes the Administrative
Agent to take such actions on its behalf, including execution of the other Loan
Documents, and to exercise such powers as are delegated to the Administrative
Agent by the terms of the Loan Documents, together with such actions and powers
as are reasonably incidental thereto.

                    The bank serving as the Administrative Agent hereunder shall
have the same rights and powers in its capacity as a Lender as any other Lender
and may exercise the same as though it were not the Administrative Agent, and
such bank and its Affili­ates may accept deposits from, lend money to and
generally engage in any kind of business with the Loan Parties or any Subsidiary
of a Loan Party or other Affiliate thereof as if it were not the Administrative
Agent hereunder.

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                    The Administrative Agent shall not have any duties or
obligations except those expressly set forth in the Loan Documents. Without
limiting the generality of the foregoing, (a) the Administrative Agent shall not
be subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing, (b) the Administrative Agent shall not
have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated by the
Loan Documents that the Administrative Agent is required to exercise in writing
as directed by the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in Section
9.02), and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to any Loan Party
or any of its Subsidiaries that is communicated to or obtained by the bank
serving as Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Required Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02) or in the absence of its own gross negligence or
willful misconduct. The Administrative Agent shall be deemed not to have
knowledge of any Default unless and until written notice thereof is given to the
Administrative Agent by the Borrower or a Lender, and the Administrative Agent
shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with any
Loan Document, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection with any Loan Document, (iii) the
performance or observance of any of the covenants, agreements or other terms or
conditions set forth in any Loan Document, (iv) the validity, enforceability,
effectiveness or genuineness of any Loan Document or any other agreement,
instrument or document, (v) the creation, perfection or priority of Liens on the
Collateral or the existence of the Collateral, or (vi) the satisfaction of any
condition set forth in Article IV or elsewhere in any Loan Document, other than
to confirm receipt of items expressly required to be delivered to the
Administrative Agent.

                    The Administrative Agent shall be entitled to rely upon, and
shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing believed
by it to be genuine and to have been signed or sent by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to be made by the proper Person, and shall not
incur any liability for relying thereon. The Administrative Agent may consult
with legal counsel (who may be counsel for the Borrower), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts.

                    The Administrative Agent may perform any and all its duties
and exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.

                    Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent may
resign at any time by notifying the Lenders, the Issuing Bank and the Borrower.
Upon any such resignation, the Required Lenders shall have the right, in
consultation with the Borrower, to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of its resignation, then the retiring Administrative Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Administrative Agent which
shall be a commercial bank or an Affiliate of any such commercial bank. Upon the
acceptance of its appointment as

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Administrative Agent hereunder by a successor, such successor shall succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. The fees payable by the
Borrower to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor. After the Administrative Agent’s resignation hereunder, the
provisions of this Article and Section 9.03 shall continue in effect for the
benefit of such retiring Administrative Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while it was acting as Administrative Agent.

                    Each Lender acknowledges that it has, independently and
without reliance upon the Administrative Agent or any other Lender and based on
such documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
informa­tion as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any other Loan Document or related agreement or any document
furnished hereunder or thereunder.

                    Each Lender hereby agrees that (a) it has requested a copy
of each Report prepared by or on behalf of the Administrative Agent; (b) the
Administrative Agent (i) makes no representation or warranty, express or
implied, as to the completeness or accuracy of any Report or any of the
information contained therein or any inaccuracy or omission contained in or
relating to a Report and (ii) shall not be liable for any information contained
in any Report; (c) the Reports are not comprehensive audits or examinations, and
that any Person performing any field examination will inspect only specific
information regarding the Loan Parties and will rely significantly upon the Loan
Parties’ books and records, as well as on representations of the Loan Parties’
personnel and that the Administrative Agent undertakes no obligation to update,
correct or supplement the Reports; (d) it will keep all Reports confidential and
strictly for its internal use, not share the Report with any Loan Party or any
other Person except as otherwise permitted pursuant to this Agreement; and (e)
without limiting the generality of any other indemnification provision contained
in this Agreement, it will pay and protect, and indemnify, defend, and hold the
Administrative Agent and any such other Person preparing a Report harmless from
and against, the claims, actions, proceedings, damages, costs, expenses, and
other amounts (including reasonable attorney fees) incurred by as the direct or
indirect result of any third parties who might obtain all or part of any Report
through the indemnifying Lender.

ARTICLE IX

Miscellaneous

                    SECTION 9.01. Notices.

                    (a) Except in the case of notices and other communications
expressly permitted to be given by telephone (and subject to paragraph (b)
below), all notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by facsimile, at the address or facsimile
number specified below each party’s signature to this agreement, or if to any
other Lender, to it at its address or facsimile number set forth in its
Administrative Questionnaire. All such notices and other communications (i) sent
by hand or overnight courier service, or mailed by certified or registered mail,
shall be deemed to have been given when received or (ii) sent by facsimile shall
be deemed to have been given when sent, provided 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.

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                     (b) Notices and other communications to the Lenders
hereunder may be delivered or furnished by electronic communications (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
pursuant to Article II or to compliance and no Event of Default certificates
delivered pursuant to Section 5.01(d) unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or the
Borrower (on behalf of the Loan Parties) may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications. All such notices and
other communications (i) sent to an e-mail address shall be deemed received upon
the sender’s receipt of an acknowledgement from the intended recipient (such as
by the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if not given during the normal business
hours of the recipient, such notice or communication shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient, and (ii) posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail address
as described in the foregoing clause (b)(i) of notification that such notice or
communication is available and identifying the website address therefor.

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

                    SECTION 9.02. Waivers; Amendments.

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

                    (b) Neither this Agreement nor any other Loan Document nor
any provision hereof or thereof may be waived, amended or modified except (i) in
the case of this Agreement, pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders or, (ii) in the case of
any other Loan Document, pursuant to an agreement or agreements in writing
entered into by the Administrative Agent and the Loan Party or Loan Parties that
are parties thereto, with the consent of the Required Lenders; provided that no
such agreement shall (i) increase the Commitment of any Lender without the
written consent of such Lender, (ii) reduce or forgive the principal amount of
any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce or
forgive any interest or fees payable hereunder, without the written consent of
each Lender directly affected thereby, (iii) postpone any scheduled date of
payment of the principal amount of any Loan or LC Disbursement, or any date for
the payment of any interest, fees or other Obligations payable hereunder, or
reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the written consent of
each Lender directly affected thereby, (iv) change Section 2.18(b) or (d) in a
manner

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that would alter the manner in which payments are shared, without the written
consent of each Lender, (v) change any of the provisions of this Section or the
definition of “Required Lenders” or any other provision of any Loan Document
specifying the number or percentage of Lenders (or Lenders of any Class)
required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender, (vi) release any Loan Guarantor from its obligation under its Loan
Guaranty (except as otherwise permitted herein or in the other Loan Documents),
without the written consent of each Lender, or (vii) except as provided in
clauses (d) and (e) of this Section or in any Collateral Document, release all
or substantially all of the Collateral, without the written consent of each
Lender; provided further that no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent, the Swingline Lender or
the Issuing Bank hereunder without the prior written consent of the
Administrative Agent, the Swingline Lender or the Issuing Bank, as the case may
be. The Administrative Agent may also amend the Commitment Schedule to reflect
assignments entered into pursuant to Section 9.04

                    (c) The Lenders hereby irrevocably authorize the
Administrative Agent, at its option and in its sole discretion, to release any
Liens granted to the Administrative Agent by the Loan Parties on any Collateral
(i) upon the termination of the all Commitments, payment and satisfaction in
full in cash of all Secured Obligations (other than Unliquidated Obligations),
and the cash collateralization of all Unliquidated Obligations in a manner
satisfactory to each affected Lender, (ii) constituting property being sold or
disposed of if the Loan Party disposing of such property certifies to the
Administrative Agent that the sale or disposition is made in compliance with the
terms of this Agreement (and the Administrative Agent may rely conclusively on
any such certificate, without further inquiry), (iii) constituting property
leased to a Loan Party under a lease which has expired or been terminated in a
transaction permitted under this Agreement, or (iv) as required to effect any
sale or other disposition of such Collateral in connection with any exercise of
remedies of the Administrative Agent and the Lenders pursuant to Article VII.
Except as provided in the preceding sentence, the Administrative Agent will not
release any Liens on Collateral without the prior written authorization of the
Required Lenders; provided that, the Administrative Agent may in its discretion,
release its Liens on Collateral valued in the aggregate not in excess of
$100,000 during any calendar year without the prior written authorization of the
Required Lenders. Any such release shall not in any manner discharge, affect, or
impair the Obligations or any Liens (other than those expressly being released)
upon (or obligations of the Loan Parties in respect of) all interests retained
by the Loan Parties, including the proceeds of any sale, all of which shall
continue to constitute part of the Collateral.

                    (d) If, in connection with any proposed amendment, waiver or
consent requiring the consent of “each Lender” or “each Lender affected
thereby,” the consent of the Required Lenders is obtained, but the consent of
other necessary Lenders is not obtained (any such Lender whose consent is
necessary but not obtained being referred to herein as a “Non-Consenting
Lender”), then the Borrower may elect to replace a Non-Consenting Lender as a
Lender party to this Agreement, provided that, concurrently with such
replacement, (i) another bank or other entity which is reasonably satisfactory
to the Borrower and the Administrative Agent shall agree, as of such date, to
purchase for cash the Loans and other Obligations due to the Non-Consenting
Lender pursuant to an Assignment and Assumption and to become a Lender for all
purposes under this Agreement and to assume all obligations of the
Non-Consenting Lender to be terminated as of such date and to comply with the
requirements of clause (b) of Section 9.04, and (ii) the Borrower shall pay to
such Non-Consenting Lender in same day funds on the day of such replacement (1)
all interest, fees and other amounts then accrued but unpaid to such
Non-Consenting Lender by the Borrower hereunder to and including the date of
termination, including without limitation payments due to such Non-Consenting
Lender under Sections 2.15 and 2.17, and (2) an amount, if any, equal to the
payment which would have been due to such Lender on the day of such replacement
under Section 2.16 had the Loans of such Non-Consenting Lender been prepaid on
such date rather than sold to the replacement Lender.

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                    SECTION 9.03. Expenses; Indemnity; Damage Waiver.

                    (a) The Borrower shall pay (i) all reasonable out-of-pocket
expenses incurred by the Administrative Agent and its Affiliates, including the
reasonable fees, charges and disbursements of counsel for the Administrative
Agent, in connection with the syndication and distribution (including, without
limitation, via the internet or through a service such as Intralinks) of the
credit facilities provided for herein, the preparation and administration of the
Loan Documents or any amendments, modifications or waivers of the provi­sions of
the Loan Documents (whether or not the Transactions shall be consummated), (ii)
all reasonable out-of-pocket expenses incurred by the Issuing Bank in connection
with the issuance, amendment, renewal or extension of any Letter of Credit or
any demand for payment thereunder and (iii) all reasonable out-of-pocket
expenses incurred by the Administrative Agent or the Issuing Bank (and following
and during the continuance of any Default or Event of Default, all out-of-pocket
expenses incurred by any Lender), including the fees, charges and disbursements
of any counsel for the Administrative Agent or the Issuing Bank (and following
and during the continuance of any Default or Event of Default, counsel for any
Lender), in connection with the enforcement, collection or protection of its
rights in connection with the Loan Documents, including its rights under this
Section, or in connection with the Loans made or Letters of Credit issued
hereunder, including all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit. Expenses being reimbursed by the Borrower under this Section include,
without limiting the generality of the foregoing, out-of-pocket costs and
expenses incurred in connection with:

          (i) appraisals and insurance reviews;

          (ii) field examinations and the preparation of Reports based on the
fees charged by a third party retained by the Administrative Agent or the
internally allocated fees for each Person employed by the Administrative Agent
with respect to each field examination; provided, however, so long as no Default
or Event of Default shall have occurred and be continuing, the Borrower shall
not be required to reimburse the Administrative Agent for the costs of more than
one field examination conducted in any period of 12 consecutive months;

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

          (iv) taxes, fees and other charges for (A) lien and title searches and
title insurance and (B) recording the Mortgages, filing financing statements and
continuations, and other actions to perfect, protect, and continue the
Administrative Agent’s Liens;

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

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

All of the foregoing costs and expenses may be charged to the Borrower as
Revolving Loans or to another deposit account, all as described in
Section 2.18(c).

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                    (b) The Borrower shall indemnify the Administrative Agent,
the Issuing Bank and each Lender, and each Related Party of any of the foregoing
Persons (each such Person being called an “Indemnitee”) against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, penalties,
liabilities and related expenses, including the fees, charges and disbursements
of any counsel for any Indemnitee, incurred by or asserted against any
Indemnitee arising out of, in connection with, or as a result of (i) the
execution or delivery of the Loan Documents or any agreement or instrument
contemplated thereby, the performance by the parties hereto of their respective
obligations thereunder or the consummation of the Transactions, (ii) any Loan or
Letter of Credit or the use of the proceeds therefrom (including any refusal by
the Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit), (iii) any actual or alleged presence or
release of Hazardous Materials on or from any property owned, leased or operated
by the Borrower or any of its Subsidiaries, or any Environmental Liability
related in any way to the Borrower or any of its Subsidiaries, or (iv) any
actual or prospective claim, litigation, investigation or proceeding relating to
any of the foregoing, whether based on contract, tort or any other theory and
regardless of whether any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, penalties, liabilities or related expenses are
deter­mined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee.

                    (c) To the extent that the Borrower fails to pay any amount
required to be paid by it to the Administrative Agent, the Swingline Lender or
the Issuing Bank under paragraph (a) or (b) of this Section, each Lender
severally agrees to pay to the Administrative Agent, the Swingline Lender or the
Issuing Bank, as the case may be, such Lender’s Applicable Percentage
(determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought) of such unpaid amount; provided that the unreimbursed expense
or indemnified loss, claim, damage, penalty, liability or related expense, as
the case may be, was incurred by or asserted against the Administrative Agent,
the Issuing Bank or the Swingline Lender in its capacity as such.

                    (d) To the extent permitted by applicable law, no Loan Party
shall assert, and each hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
(as opposed to direct or actual damages) arising out of, in connection with, or
as a result of, this Agreement or any agreement or instrument contemplated
hereby, the Transactions, any Loan or Letter of Credit or the use of the
proceeds thereof.

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

                    SECTION 9.04. 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 (including any Affiliate of the Issuing Bank that
issues any Letter of Credit), except that (i) the Borrower may not assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by the
Borrower without such consent shall be null and void) and (ii) no Lender may
assign or otherwise transfer its rights or obligations hereunder except in
accordance with this Section. Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), Participants
(to the extent provided in paragraph (c) of this Section) and, to the extent
expressly contemplated hereby, the Related Parties of each of the Administrative
Agent, the Issuing Bank and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.

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                    (b)(i) Subject to the conditions set forth in paragraph
(b)(ii) below, any Lender may assign to one or more assignees all or a portion
of its rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans at the time owing to it) with the prior written
consent (such consent not to be unreasonably withheld) of:

                    (A) the Borrower, provided that no consent of the Borrower
shall be required for an assignment to a Lender, an Affiliate of a Lender, an
Approved Fund or, if an Event of Default has occurred and is continuing, any
other assignee;

                    (B) the Administrative Agent; and

                    (C) the Issuing Bank.

          (ii) Assignments shall be subject to the following additional
conditions:

                    (A) except in the case of an assignment to a Lender or an
Affiliate of a Lender or an assignment of the entire remaining amount of the
assigning Lender’s Commitment or Loans of any Class, the amount of the
Commitment or Loans 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) shall not be less than
$5,000,000, unless the Borrower and the Administrative Agent otherwise consent,
provided that no such consent of the Borrower shall be required if an Event of
Default has occurred and is continuing;

                    (B) 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, provided that this clause shall not be construed to
prohibit the assignment of a proportionate part of all the assigning Lender’s
rights and obligations in respect of one Class of Commitments or Loans;

                    (C) 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; and

                    (D) the assignee, if it shall not be a Lender, shall deliver
to the Administrative Agent an Administrative Questionnaire in which the
assignee designates one or more Credit Contacts to whom all syndicate-level
information (which may contain material non-public information about the
Borrower, the Loan Parties and their Related Parties or their respective
securities) will be made available and who may receive such information in
accordance with the assignee’s compliance procedures and applicable laws,
including Federal and state securities laws.

                    For the purposes of this Section 9.04(b), the term “Approved
Fund” has the following meaning:

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

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                    (iii) Subject to acceptance and recording thereof pursuant
to paragraph (b)(iv) of this Section, from and after the effective date
specified in each Assignment and Assumption the assignee thereunder shall be a
party hereto 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 2.15, 2.16, 2.17 and 9.03). Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with
this Section 9.04 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
paragraph (c) of this Section.

                    (iv) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices 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 Commitment of, and principal
amount of the Loans and LC Disbursements owing to, each Lender pursuant to the
terms hereof from time to time (the “Register”). The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent, the Issuing
Bank 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, the Issuing Bank and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.

                    (v) Upon its receipt of a duly completed Assignment and
Assumption executed by an assigning Lender and an assignee, the assignee’s
completed Administrative Questionnaire (unless the assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in
paragraph (b) of this Section and any written consent to such assignment
required by paragraph (b) of this Section, the Administrative Agent shall accept
such Assignment and Assumption and record the information contained therein in
the Register; provided that if either the assigning Lender or the assignee shall
have failed to make any payment required to be made by it pursuant to Section
2.05, 2.06(d) or (e), 2.07(b), 2.18(d) or 9.03(c), the Administrative Agent
shall have no obligation to accept such Assignment and Assumption and record the
information therein in the Register unless and until such payment shall have
been made in full, together with all accrued interest thereon. No assignment
shall be effective for purposes of this Agreement unless it has been recorded in
the Register as provided in this paragraph.

                    (c)(i) Any Lender may, without the consent of the Borrower,
the Administrative Agent, the Issuing Bank or the Swingline Lender, sell
participations to one or more banks or other entities (a “Participant”) in all
or a portion of such Lender’s rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it);
provided that (A) such Lender’s obligations under this Agreement shall remain
unchanged, (B) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (C) the Borrower, the
Administrative Agent, the Issuing Bank 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, modification or waiver
described in the first proviso to Section 9.02(b) that affects such Participant.
Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.15, 2.16 and 2.17 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section. To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 9.08 as
though it were a Lender, provided such Participant agrees to be subject to
Section 2.18(c) as though it were a Lender.

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                    (ii) A Participant shall not be entitled to receive any
greater payment under Section 2.15 or 2.17 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. A Participant that would be a Foreign
Lender if it were a Lender shall not be entitled to the benefits of Section 2.17
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 2.17(e) as though it were a Lender.

                    (d) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including without limitation any pledge or
assignment to secure obligations to a Federal Reserve Bank, and this Section
shall not apply to any such pledge or assignment of a security interest;
provided that no such pledge or assignment of a security interest shall release
a Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.

                    SECTION 9.05. Survival. All covenants, agreements,
representations and warranties made by the Loan Parties in the Loan Documents
and in the certificates or other instru­ments delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the other parties hereto and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and
issuance of any Letters of Credit, regardless of any investigation made by any
such other party or on its behalf and notwithstanding that the Administrative
Agent, the Issuing Bank or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any fee or any other amount
payable under this Agreement is outstand­ing and unpaid or any Letter of Credit
is outstanding and so long as the Commitments have not expired or terminated.
The provisions of Sections 2.15, 2.16, 2.17 and 9.03 and Article VIII shall
survive and remain in full force and effect regardless of the consummation of
the transactions contemplated hereby, the repayment of the Loans, the expiration
or termination of the Letters of Credit and the Commitments or the termination
of this Agreement or any provision hereof.

                    SECTION 9.06. Counterparts; Integration; Effectiveness. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement,
the other Loan Documents and any separate letter agreements with respect to fees
payable to the Administrative Agent constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 4.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts hereof which, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page of this Agreement by facsimile shall be effective as
delivery of a manually executed counterpart of this Agreement.

                    SECTION 9.07. Severability. Any provision of any Loan
Document held to be invalid, illegal or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such invalidity,
illegality or unenforceability without affecting the validity, legality and
enforceability of the remaining provisions thereof; and the invalidity of a
particular provision in a particular jurisdiction shall not invalidate such
provision in any other jurisdiction.

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                    SECTION 9.08. Right of Setoff. If an Event of Default shall
have occurred and be continuing, each Lender and each of its Affiliates is
hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other obligations at
any time owing by such Lender or Affiliate to or for the credit or the account
of the obligated Borrower or such Loan Guarantor against any of and all the
Secured Obligations owed by the Borrower or Loan Guarantor held by such Lender,
irrespective of whether or not such Lender shall have made any demand under the
Loan Documents and although such obligations may be unmatured. The applicable
Lender shall notify the Borrower and the Administrative Agent of such set-off or
application, provided that any failure to give or any delay in giving such
notice shall not affect the validity of any such set-off or application under
this Section. The rights of each Lender under this Section are in addition to
other rights and remedies (including other rights of setoff) which such Lender
may have.

                    SECTION 9.09. Governing Law; Jurisdiction; Consent to
Service of Process.

                    (a) The Loan Documents (other than those containing a
contrary express choice of law provision) shall be governed by and construed in
accordance with the internal laws of the State of Indiana, but giving effect to
federal laws applicable to national banks.

                    (b) Each Loan Party hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of any
U.S. Federal or Indiana State court sitting in Indianapolis, Indiana in any
action or proceeding arising out of or relating to any Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such Indiana State or,
to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement or any other Loan
Document shall affect any right that the Administrative Agent, the Issuing Bank
or any Lender may otherwise have to bring any action or proceeding relating to
this Agreement or any other Loan Document against any Loan Party or its
proper­ties in the courts of any jurisdiction.

                    (c) Each Loan Party hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or here­after have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Agreement or any
other Loan Document in any court referred to in paragraph (b) of this Section.
Each of the parties hereto hereby irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court.

                    (d) Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.01. Nothing
in this Agreement or any other Loan Document will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.

                    SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

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                    SECTION 9.11. Headings. Article and Section headings and the
Table of Contents used herein are for convenience of reference only, are not
part of this Agreement and shall not affect the construction of, or be taken
into consideration in interpreting, this Agreement.

                    SECTION 9.12. Confidentiality. Each of the Administrative
Agent, the Issuing Bank and the Lenders agrees to maintain the confidentiality
of the Information (as defined below), except that Information may be disclosed
(a) to its and its Affiliates’ directors, officers, employees and agents,
including accountants, legal counsel and other advisors (it being understood
that the Persons to whom such disclosure is made will be informed of the
confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority, (c) to
the extent required by Requirement of Law or by any subpoena or similar legal
process, (d) to any other party to this Agreement, (e) in connection with the
exercise of any remedies hereunder or any suit, action or proceeding relating to
this Agreement or any other Loan Document or the enforcement of rights hereunder
or thereunder, (f) subject to an agreement containing provisions substantially
the same as those of this Section, to (i) any assignee of or Participant in, or
any prospective assignee of or Participant in, any of its rights or obligations
under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Loan Parties and
their obligations, (g) with the consent of the Borrower or (h) to the extent
such Information (i) becomes publicly available other than as a result of a
breach of this Section or (ii) becomes available to the Administrative Agent,
the Issuing Bank or any Lender on a non-confidential basis from a source other
than the Borrower. For the purposes of this Section, “Information” means all
information received from the Borrower relating to the Borrower or its business,
other than any such information that is available to the Administrative Agent,
the Issuing Bank or any Lender on a non-confidential basis prior to disclosure
by the Borrower; provided that, in the case of information received from the
Borrower after the date hereof, such information is clearly identified at the
time of delivery as confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.

                    SECTION 9.13. Several Obligations; Nonreliance; Violation of
Law. The respective obligations of the Lenders hereunder are several and not
joint and the failure of any Lender to make any Loan or perform any of its
obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. Each Lender hereby represents that it is not relying on
or looking to any margin stock for the repayment of the Borrowings provided for
herein. Anything contained in this Agreement to the contrary notwithstanding,
neither the Issuing Bank nor any Lender shall be obligated to extend credit to
the Borrower in violation of any Requirement of Law.

                    SECTION 9.14. USA PATRIOT Act. Each Lender that is subject
to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001)) (the “Act”) hereby notifies the Borrower that
pursuant to the requirements of the Act, it is required to obtain, verify and
record information that identifies the Borrower, which information includes the
names and addresses of the Borrower and other information that will allow such
Lender to identify the Borrower in accordance with the Act.

                    SECTION 9.15. Disclosure. Each Loan Party and each Lender
hereby acknowledges and agrees that the Administrative Agent and/or its
Affiliates from time to time may hold investments in, make other loans to or
have other relationships with any of the Loan Parties and their respective
Affiliates.

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                    SECTION 9.16. Appointment for Perfection. Each Lender hereby
appoints each other Lender as its agent for the purpose of perfecting Liens, for
the benefit of the Administrative Agent and the Lenders, in assets which, in
accordance with Article 9 of the UCC or any other applicable law can be
perfected only by possession. Should any Lender (other than the Administrative
Agent) obtain possession of any such Collateral, such Lender shall notify the
Administrative Agent thereof, and, promptly upon the Administrative Agent’s
request therefor shall deliver such Collateral to the Administrative Agent or
otherwise deal with such Collateral in accordance with the Administrative
Agent’s instructions.

                    SECTION 9.17. Interest Rate Limitation. Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan, together with all fees, charges and other amounts which are treated as
interest on such Loan under appli­cable law (collectively the “Charges”), shall
exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for,
charged, taken, received or reserved by the Lender holding such Loan in
accordance with applicable law, the rate of interest payable in respect of such
Loan hereunder, together with all Charges payable in respect thereof, shall be
limited to the Maximum Rate and, to the extent lawful, the interest and Charges
that would have been payable in respect of such Loan but were not payable as a
result of the operation of this Section shall be cumulated and the interest and
Charges payable to such Lender in respect of other Loans or periods shall be
increased (but not above the Maximum Rate therefor) until such cumulated amount,
together with interest thereon at the Federal Funds Effective Rate to the date
of repayment, shall have been received by such Lender.

ARTICLE X

Prior Credit Facilities

                    SECTION 10.01. Waiver of Existing Defaults. Chase and the
Borrower are parties to an Amended and Restated Credit Agreement, dated as of
October 24, 2001 (as amended to date, the “2001 Credit Agreement”). Subject to
the satisfaction to Chase’s reasonable discretion of all conditions precedent
set forth in Section 4.01 of this Agreement, Chase waives the Existing Defaults.
This waiver is a one time waiver and shall not be deemed to be a waiver by Chase
to anything not specifically described in this Section 10.01. As used in this
Section 10.01, the term “Existing Defaults” means all defaults existing under
the 2001 Credit Agreement due to (a) the failure by Borrower and its
Subsidiaries to maintain a debt service coverage ratio, determined on a
consolidated basis, of at least 1.20 to 1.00 as required pursuant to Section
5(g)(iii) of the 2001 Credit Agreement for; and (b) the failure by Borrower and
its Subsidiaries to maintain a Leverage Ratio (as such term is defined in the
2001 Credit Agreement) of not greater than 2.75 to 1.00 as required pursuant to
Section 5(g)(i) of the 2001 Credit Agreement.

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                    SECTION 10.02. Amendment and Restatement of 2001 Credit
Agreement and Indiana-Martin Credit Agreement/Continuation of Principal Balance.
This Agreement amends, and as so amended, restates and consolidates the 2001
Credit Agreement and that certain Credit Agreement, dated as of September 5,
2003, between Bank One, National Association (to which Chase is the successor by
merger) and Indian-Martin, Inc. (the “Indian-Martin Credit Agreement”). This
Agreement continues and replaces the 2001 Credit Agreement and the Indian-Martin
Credit Agreement. Indian-Martin, Inc. has been, or is being on the Effective
Date, merged into Borrower, with Borrower being the surviving entity. The
principal balances under the 2001 Credit Agreement and the Indian-Martin Credit
Agreement that were outstanding immediately prior to such amendment and
restatement shall be the initial outstanding principal balance under this
Agreement. All advances under the 2001 Credit Agreement and the Indian-Martin
Credit Agreement that bear interest based on the EURIBOR Rate or the LIBOR Rate
under the 2001 Credit Agreement or the Indian-Martin Credit Agreement shall
continue in effect under this Agreement without any change in the Interest
Period applicable thereto (the “Existing Eurocurrency Loans”). Borrower is not
required to pay, on the Effective Date, a fee of the type described in Section
2.16 of this Agreement with respect to the Existing Eurocurrency Loans that
continue in effect under this Agreement.

                    SECTION 10.03. Termination of Commitments. The “Euro
Revolving Loan Commitment” and “Revolving Loan Commitment” made available by
Chase to Escalade pursuant to the 2001 Credit Agreement are terminated. The
“Commitment” made available by Chase to Indian-Martin, Inc. pursuant to the
Indian-Martin Credit Agreement is terminated.

[SIGNATURE PAGE FOLLOWS]

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[SIGNATURE PAGE TO CREDIT AGREEMENT]

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

 

 

 

 

ESCALADE, INCORPORATED

 

 

 

 

By:

/s/ DEBORAH J. MEINERT

 

 

 

 

 

Deborah J. Meinert, VP Finance and CFO

 

 

 

 

Notice Address of Escalade, Incorporated:

 

817 Maxwell Ave.

 

Evansville, IN 47711

 

Attention: Deborah Meinert

 

Facsimile No: 8120467-1303

 

 

 

JPMORGAN CHASE BANK, N.A., individually, as Administrative Agent, Issuing Bank,
Swingline Lender and a Lender

 

 

 

By:

/s/ H. ROBERT HILL

 

 

 

 

 

H. Robert Hill, Vice President

 

 

 

Notice Address for JPMorgan Chase Bank, N.A.:

 

 

 

JPMorgan Chase Bank, N.A.

 

1 East Ohio Street, 4th Floor

 

Indianapolis, IN 46277

 

Attention: Commercial Lending Group

 

Facsimile No: (317) 767-8333

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