Exhibit 10.1

 

 

 

 

CREDIT AGREEMENT

DATED AS OF NOVEMBER 25, 2003

AMONG

DEPARTMENT 56, INC.

THE LENDERS

AND

BANK ONE, NA

as Administrative Agent, LC Issuer and Swing Line Lender

 

 

 

BANC ONE CAPITAL MARKETS, INC.
as Lead Arranger and Sole Book Runner

 

 

 

 

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TABLE OF CONTENTS

 

ARTICLE I  DEFINITIONS

 

 

 

ARTICLE II  THE CREDITS

 

2.1

Commitment

 

2.2

Required Payments

 

2.3

Ratable Loans

 

2.4

Types of Advances

 

2.5

Swing Line Loans

 

2.6

Commitment Fee; Reductions and Increases in Aggregate Commitment

 

2.7

Minimum Amount of Each Advance

 

2.8

Optional Principal Payments

 

2.9

Method of Selecting Types and Interest Periods for New Advances

 

2.10

Conversion and Continuation of Outstanding Advances

 

2.11

Changes in Interest Rate, etc

 

2.12

Rates Applicable After Default

 

2.13

Method of Payment

 

2.14

Noteless Agreement; Evidence of Indebtedness

 

2.15

Telephonic Notices

 

2.16

Interest Payment Dates; Interest and Fee Basis

 

2.17

Notification of Advances, Interest Rates, Prepayments and Commitment Reductions

 

2.18

Lending Installations

 

2.19

Non-Receipt of Funds by the Administrative Agent

 

2.20

Facility LCs

 

2.21

Replacement of Lender

 

 

 

 

ARTICLE III  YIELD PROTECTION; TAXES

 

3.1

Yield Protection

 

3.2

Changes in Capital Adequacy Regulations

 

3.3

Availability of Types of Advances

 

3.4

Funding Indemnification

 

3.5

Taxes

 

3.6

Lender Statements; Survival of Indemnity

 

 

 

 

ARTICLE IV  CONDITIONS PRECEDENT

 

4.1

Initial Credit Extension

 

4.2

Each Credit Extension

 

 

 

 

ARTICLE V  REPRESENTATIONS AND WARRANTIES

 

5.1

Financial Condition

 

5.2

No Change

 

5.3

Corporate Existence; Compliance With Law

 

5.4

Corporate Power

 

5.5

No Legal Bar

 

5.6

Litigation

 

5.7

No Default

 

5.8

Ownership of Property; Liens

 

5.9

Intellectual Property

 

 

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5.10

Taxes

 

5.11

Federal Regulations

 

5.12

Labor Matters

 

5.13

ERISA

 

5.14

Investment Company Act; Other Regulations

 

5.15

Subsidiaries

 

5.16

Use of Proceeds

 

5.17

Environmental Matters

 

5.18

Accuracy of Information

 

5.19

Collateral Documents

 

5.20

Solvency

 

5.21

Reportable Transaction

 

 

 

 

ARTICLE VI  COVENANTS

 

6.1

Financial Statements

 

6.2

Certificates; Other Information

 

6.3

Payment of Obligations

 

6.4

Maintenance of Existence; Compliance

 

6.5

Maintenance of Property; Insurance

 

6.6

Inspection of Property; Books and Records, Discussions

 

6.7

Notices

 

6.8

Environmental Laws

 

6.9

Additional Collateral, Guaranties, Etc

 

 

 

 

ARTICLE VII  NEGATIVE COVENANTS

 

7.1

Financial Condition Covenants

 

7.2

Indebtedness

 

7.3

Liens

 

7.4

Fundamental Changes

 

7.5

Disposition of Property

 

7.6

Restricted Payments

 

7.7

Investments

 

7.8

Transactions with Affiliates

 

7.9

Changes in Fiscal Periods

 

7.10

Negative Pledge Clauses

 

7.11

Clauses Restricting Subsidiary Distributions

 

7.12

Lines of Business

 

7.13

Contingent Obligations

 

7.14

Foreign Exchange and Rate Management Transactions

 

 

 

 

ARTICLE VIII  DEFAULTS

 

 

 

ARTICLE IX  ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES

9.1

Acceleration; Facility LC Collateral Account

 

9.2

Amendments

 

9.3

Preservation of Rights

 

 

 

 

ARTICLE X  GENERAL PROVISIONS

 

10.1

Survival of Representations

 

10.2

Governmental Regulation

 

10.3

Headings

 

 

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10.4

Entire Agreement

 

10.5

Several Obligations; Benefits of this Agreement

 

10.6

Expenses; Indemnification

 

10.7

Numbers of Documents

 

10.8

Accounting

 

10.9

Severability of Provisions

 

10.10

Nonliability of Lenders

 

10.11

Confidentiality

 

10.12

Nonreliance

 

10.13

Disclosure

 

10.14

USA PATRIOT ACT NOTIFICATION

 

 

 

 

ARTICLE XI  THE ADMINISTRATIVE AGENT

 

11.1

Appointment; Nature of Relationship

 

11.2

Powers

 

11.3

General Immunity

 

11.4

No Responsibility for Loans, Recitals, etc

 

11.5

Action on Instructions of Lenders

 

11.6

Employment of Administrative Agents and Counsel

 

11.7

Reliance on Documents; Counsel

 

11.8

Administrative Agent’s Reimbursement and Indemnification

 

11.9

Notice of Default

 

11.10

Rights as a Lender

 

11.11

Lender Credit Decision

 

11.12

Successor Administrative Agent

 

11.13

Administrative Agent and Arranger Fees

 

11.14

Delegation to Affiliates

 

11.15

Execution of Collateral Documents

 

11.16

Collateral Releases

 

 

 

 

ARTICLE XII  SETOFF; RATABLE PAYMENTS

 

12.1

Setoff

 

12.2

Ratable Payments

 

 

 

 

ARTICLE XIII  BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

 

13.1

Successors and Assigns

 

13.2

Participations

 

13.3

Assignments

 

13.4

Dissemination of Information

 

13.5

Tax Treatment

 

 

 

 

ARTICLE XIV  NOTICES

 

14.1

Notices; Effectiveness; Electronic Communication

 

 

 

 

ARTICLE XV  COUNTERPARTS; INTEGRATION; EFFECTIVENESS; ELECTRONIC EXECUTION

 

15.1

Counterparts; Effectiveness

 

15.2

Electronic Execution of Assignments

 

 

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ARTICLE XVI  CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

 

16.1

CHOICE OF LAW

 

16.2

CONSENT TO JURISDICTION

 

16.3

WAIVER OF JURY TRIAL

 

 

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EXHIBITS AND SCHEDULES

 

Exhibits

 

 

 

 

 

Exhibit A

Form of Borrowing Base Certificate

 

Exhibit B

Form of Compliance Certificate

 

Exhibit C

Form of Assignment Agreement

 

Exhibit D

Loan/Credit Related Money Transfer Instruction

 

Exhibit E

Form of Note

 

 

 

 

Schedules

 

 

 

 

 

Commitment Schedule

 

Pricing Schedule

 

 

 

 

Schedule 5.4

Consents, Authorizations, Filings and Notices

 

Schedule 5.9

Intellectual Property

 

Schedule 5.15

Subsidiaries

 

Schedule 5.19(a)

UCC Filing Jurisdictions

 

Schedule 7.2(d)

Existing Indebtedness

 

Schedule 7.3(f)

Existing Liens

 

Schedule 7.13

Contingent Obligations

 

 

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CREDIT AGREEMENT

 

This Agreement, dated as of November 25, 2003, is among Department 56, Inc., the
Lenders (as defined herein) and Bank One, NA, a national banking association
having its principal office in Chicago, Illinois, as LC Issuer, as Swing Line
Lender and as Administrative Agent.  The parties hereto agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

As used in this Agreement:

 

“Accounts” has the meaning set forth in the Uniform Commercial Code.

 

“Advance” means a borrowing hereunder, (a) made by the Lenders on the same
Borrowing Date, or (b) converted or continued by the Lenders on the same date of
conversion or continuation, consisting, in either case, of the aggregate amount
of the several Loans of the same Type and, in the case of Eurodollar Loans, for
the same Interest Period.  The term “Advance” shall include Swing Line Loans
unless otherwise expressly provided.

 

“Administrative Agent” means Bank One in its capacity as contractual
representative of the Lenders pursuant to Article XI, and not in its individual
capacity as a Lender, and any successor Administrative Agent appointed pursuant
to Article XI.

 

“Affiliate” of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person.  A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.

 

“Aggregate Available Commitment” means, at any time, (a) the lesser of (i) the
Aggregate Commitment at such time and (ii) the Borrowing Base, less (b) the
outstanding LC Obligations at such time, and less (c) the outstanding Swing Line
Loans at such time.

 

“Aggregate Commitment” means the aggregate of the Commitments of all the
Lenders, as reduced or increased from time to time pursuant to the terms hereof.

 

“Aggregate Outstanding Credit Exposure” means, at any time, the aggregate of the
Outstanding Credit Exposure of all the Lenders.

 

“Agreement” means this credit agreement, as it may be amended or modified and in
effect from time to time.

 

“Alternate Base Rate” means, for any day, a rate of interest per annum equal to
the higher of (a) the Prime Rate for such day and (b) the sum of the Federal
Funds Effective Rate for such day plus 0.5% per annum.

 

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“Applicable Fee Rate” means, at any time, the percentage rate per annum at which
Commitment Fees are accruing on the unused portion  of the Aggregate Commitment
(with outstanding Facility LCs being deemed usage but Swing Line Loans not being
deemed usage) and LC Fees are accruing or are required to be paid on outstanding
Facility LCs, in each case as set forth in the Pricing Schedule.

 

“Applicable Margin” means, with respect to Advances of any Type at any time, the
percentage rate per annum which is applicable at such time with respect to
Advances of such Type as set forth in the Pricing Schedule.

 

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

 

“Arranger” means Banc One Capital Markets, Inc., a Delaware corporation, and its
successors, in its capacity as Lead Arranger and Sole Book Runner.

 

“Article” means an article of this Agreement unless another document is
specifically referenced.

 

“Asset Sale” means any Disposition of Property or series of related Dispositions
of Property (excluding any such Disposition permitted by clause (a), (b), (c) or
(d) of Section 7.5) that yields gross proceeds to the Borrower or any of its
Subsidiaries (valued at the initial principal amount thereof in the case of
non-cash proceeds consisting of notes or other debt securities and valued at
fair market value in the case of other non-cash proceeds) in excess of $500,000.

 

“Authorized Officer” means, with respect to financial matters, the chief
financial officer of the Borrower, with respect to the execution and delivery of
Borrowing Notices and Swing Line Borrowing Notices, the chief financial officer
or the managing director of finance of the Borrower, and, with respect to all
other matters, the chief executive officer, president or chief financial officer
of the Borrower.

 

“Bank One” means Bank One, NA, a national banking association having its
principal office in Chicago, Illinois, in its individual capacity, and its
successors.

 

“Board” means the Board of Governors of the Federal Reserve System of the United
States (or any successor).

 

“Borrower” means Department 56, Inc., a Delaware corporation.

 

“Borrowing Base” means, as of any date, the amount, as determined by the
Borrowing Base Certificate most recently furnished to the Administrative Agent
pursuant to Section 4.1(j) or Section 6.2(g), equal to the greater of (a)
$30,000,000 and (b) the sum of (i) 80% of the book value of all Eligible
Accounts plus (ii) 50% of the book value of all Eligible Inventory, valued at
the lower of cost (determined on an averaged cost basis, which approximates a
first-in, first-out basis) or market, at such time.

 

“Borrowing Base Certificate” means a borrowing base certificate in substantially
the form of Exhibit A hereto.

 

“Borrowing Date” means a date on which an Advance is made hereunder.

 

“Borrowing Notice” is defined in Section 2.9.

 

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“Business Day” means (a) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago and New York City for the conduct of
substantially all of their commercial lending activities, interbank wire
transfers can be made on the Fedwire system and dealings in United States
dollars are carried on in the London interbank market and (b) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Chicago for the conduct of substantially all of their commercial lending
activities and interbank wire transfers can be made on the Fedwire system.

 

“Capitalized Lease” of a Person means any lease of Property by such Person as
lessee which would be capitalized on a balance sheet of such Person prepared in
accordance with GAAP.

 

“Capital Lease Obligations” of any Person, means the obligations of such Person
to pay rent or other amounts under any Capitalized Lease and, for the purposes
of this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.

 

“Capital Stock” means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person other than a corporation and any and
all warrants, rights or options to purchase any of the foregoing.

 

“Cash Equivalents” means (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, eurodollar time deposits or overnight
bank deposits having maturities of six months or less from the date of
acquisition issued by any Lender or by any commercial bank organized under the
laws of the United States or any state thereof having combined capital and
surplus of not less than $500,000,000; (c) commercial paper of an issuer rated
at least A-1 by S&P or P-1 by Moody’s, or carrying an equivalent rating by a
nationally recognized rating agency, if both of the two named rating agencies
cease publishing ratings of commercial paper issuers generally, and maturing
within six months from the date of acquisition; (d) repurchase obligations of
any Lender or of any commercial bank satisfying the requirements of clause (b)
of this definition, having a term of not more than 30 days, with respect to
securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at least
“A” by S&P or “A” by Moody’s; (f) securities with maturities of six months or
less from the date of acquisition backed by standby letters of credit issued by
any Lender or any commercial bank satisfying the requirements of clause (b) of
this definition; or (g) shares of money market mutual or similar funds which
invest exclusively in assets satisfying the requirements of clauses (a) through
(f) of this definition.

 

“Closing Date” means the date on which the conditions precedent set forth in
Section 4.1 shall have been satisfied or waived.

 

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

 

“Collateral Documents” means, collectively, the Guarantee and Collateral
Agreement and all other security documents hereafter delivered to the
Administrative Agent granting a Lien or purporting to

 

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grant a Lien on any property of any Person to secure the obligations and
liabilities of any Loan Party under any Loan Document.

 

“Collateral Shortfall Amount” is defined in Section 9.1.

 

“Commitment” means, for each Lender, the obligation of such Lender to make
Revolving Loans to, and participate in Facility LCs issued upon the application
of, the Borrower in an aggregate amount not exceeding the amount set forth
opposite its name on the Commitment Schedule, as it may be modified as a result
of any assignment that has become effective pursuant to Section 13.3.2 or as
otherwise modified from time to time pursuant to Section 2.6 hereof or the other
terms hereof.

 

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

 

“Commonly Controlled Entity” means an entity, whether or not incorporated, that
is under common control with the Borrower within the meaning of Section 4001 of
ERISA or is part of a group that includes the Borrower and that is treated as a
single employer under Section 414 of the Code.

 

“Confidential Information Memorandum” means the Confidential Information
Memorandum dated October 2003 and furnished to the Lenders.

 

“Consolidated EBITDA” means, for any period, Consolidated Net Income for such
period plus (a) without duplication and to the extent reflected as a charge in
the statement of such Consolidated Net Income for such period, the sum of (i)
income tax expense, (ii) interest expense, amortization or writeoff of debt
discount and debt issuance costs and commissions, discounts and other fees and
charges associated with Indebtedness (including the Loans), (iii) depreciation
and amortization expense, (iv) amortization of intangibles (including, but not
limited to, goodwill) and organization costs, (v) any extraordinary, unusual or
non-recurring non-cash expenses or losses (including, whether or not otherwise
includable as a separate item in the statement of such Consolidated Net Income
for such period, non-cash losses on sales of assets outside of the ordinary
course of business); provided, that the amounts referred to in this clause (v)
shall not, in the aggregate, exceed $5,000,000 for any fiscal year of the
Borrower, and (vi) any other non-cash charges, and minus (b) to the extent
included in the statement of such Consolidated Net Income for such period, the
sum of (i) any extraordinary, unusual or non-recurring income or gains
(including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net Income for such period, gains on the sales of
assets outside of the ordinary course of business) and (ii) any other non-cash
income, all as determined on a consolidated basis.  For the purposes of
calculating Consolidated EBITDA for any period of four consecutive fiscal
quarters (each, a “Reference Period”) pursuant to any determination of the
Consolidated Leverage Ratio, if during such Reference Period the Borrower or any
Subsidiary shall have made a Permitted Acquisition, Consolidated EBITDA for such
Reference Period shall be calculated after giving pro forma effect thereto as if
such Permitted Acquisition occurred on the first day of such Reference Period.

 

“Consolidated Interest Coverage Ratio” means, for any period of four consecutive
fiscal quarters, the ratio of (a) Consolidated EBITDA for such period to (b)
Consolidated Interest Expense for such period.

 

“Consolidated Interest Expense” means, for any period, total cash interest
expense (including that attributable to Capital Lease Obligations) of the
Borrower and its Subsidiaries for such period with respect to all outstanding
Indebtedness of the Borrower and its Subsidiaries (including all commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers’ acceptance financing and net costs under Rate Management Transactions
in respect of interest rates to the extent such net costs are allocable to such
period in accordance with GAAP).

 

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

 

“Consolidated Net Income” means, for any period, the consolidated net income (or
loss) of the Borrower and its Subsidiaries, determined on a consolidated basis
in accordance with GAAP; provided, that there shall be excluded (a) the income
(or deficit) of any Person accrued prior to the date it becomes a Subsidiary of
the Borrower or is merged into or consolidated with the Borrower or any of its
Subsidiaries, (b) the income (or deficit) of any Person (other than a Subsidiary
of the Borrower) in which the Borrower or any of its Subsidiaries has an
ownership interest, except to the extent that any such income is actually
received by the Borrower or such Subsidiary in the form of dividends or similar
distributions and (c) the undistributed earnings of any Subsidiary of the
Borrower to the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary is not at the time permitted by the terms of
any Contractual Obligation (other than under any Loan Document) or Requirement
of Law applicable to such Subsidiary; provided further, that in the event that
the Borrower determines its compensation cost for stock options based upon the
fair value thereof, there shall be added back to Consolidated Net Income the
amount of such compensation cost calculated in accordance with GAAP.

 

“Consolidated Net Worth” means, at any date, all amounts that would, in
conformity with GAAP, be included on a consolidated balance sheet of the
Borrower and its Subsidiaries under stockholders’ equity at such date; provided
that in the event that the Borrower determines its compensation cost for stock
options based upon the fair value thereof, there shall be added back to
Consolidated Net Worth the amount of such compensation cost as cumulatively
charged from the time the Borrower begins to so determine its compensation cost,
calculated in accordance with GAAP.

 

“Consolidated Subsidiary Guarantor” means any Subsidiary Guarantor the financial
results of which would be required to be consolidated for federal income tax
purposes with the financial results of the Borrower.

 

“Consolidated Total Debt” means, at any date, the aggregate principal amount of
all Indebtedness of the Borrower and its Subsidiaries at such date, determined
on a consolidated basis in accordance with GAAP; provided that for the purposes
hereof, there shall be included in Consolidated Total Debt, in lieu of the
amount of Indebtedness outstanding under this Agreement on such date, an amount
of Indebtedness equal to (a) the average daily principal amount of outstanding
Credit Extensions for the period of four consecutive fiscal quarters ending on
such date (it being agreed that, for the purposes of calculating such amount for
any test period a portion of which is a period prior to the Closing Date, the
average daily principal amount of outstanding Credit Extensions for such
pre-Closing Date period shall be deemed to be the average daily principal amount
of total extensions of credit outstanding under the working capital facility of
the Existing Credit Agreement during such pre-Closing Date period plus
$22,000,000), plus (b) for the purpose of determining pro forma compliance in
respect of any Permitted Acquisition or Restricted Payment pursuant to
Section 7.6(b) or 7.7(g), the amount by which total Credit Extensions increased
as a result of such Permitted Acquisition or Restricted Payment.

 

“Contingent Obligation” means, as to any Person, any guarantee of payment or
performance by such Person of any Indebtedness or other obligation of any other
Person, or any agreement to provide financial assurance with respect to the
financial condition, or the payment of the obligations of, such other Person
(including, without limitation, purchase or repurchase agreements, reimbursement
agreements with respect to letters of credit or bankers’ acceptances, indemnity
arrangements, grants of security interests to support the obligations of another
Person, keepwell agreements and take-or-pay or through-put arrangements) which
has the effect of assuring or holding harmless any third Person against loss
with respect to one or more obligations of such third Person; provided, however,
that the term Contingent

 

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Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Contingent
Obligation of any Person shall be deemed to be the lesser of (a) an amount equal
to the stated or determinable amount of the primary obligation in respect of
which such Contingent Obligation is made and (b) the maximum amount for which
such contingently liable Person may be liable pursuant to the terms of the
instrument embodying such Contingent Obligation, unless such primary obligation
and the maximum amount for which such contingently liable Person may be liable
are not stated or determinable, in which case the amount of such Contingent
Obligation shall be such contingently liable Person’s maximum reasonably
anticipated liability in respect thereof, as determined by the Borrower in good
faith.

 

“Continuing Directors” means the directors of the Borrower on the Closing Date
and each other director thereof, if, in each case, such other director’s
nomination for election to the board of directors of the Borrower was
recommended by at least 66-2/3% of the then Continuing Directors.

 

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

 

“Conversion/Continuation Notice” is defined in Section 2.10.

 

“Controlled Group” means all members of a controlled group of corporations or
other business entities and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any of
its Subsidiaries, are treated as a single employer under Section 414 of the
Code.

 

“Credit Extension” means the making of an Advance or the issuance of a Facility
LC hereunder.

 

“Credit Extension Date” means the Borrowing Date for an Advance or the issuance
date for a Facility LC hereunder.

 

“Default” means an event described in Article VIII.

 

“Disposition” means, with respect to any property, any sale, lease, sale and
leaseback, assignment, conveyance, transfer or other disposition thereof.  The
terms “Dispose” and “Disposed of” shall have correlative meanings.

 

“Domestic Subsidiary” means any Subsidiary of the Borrower organized under the
laws of any jurisdiction within the United States.

 

“Eligible Accounts” means the aggregate face amount of Accounts of the Borrower
and its Subsidiaries outstanding from time to time, derived from the business
operations of the Borrower and its Subsidiaries, except those Accounts that (a)
(i) in the case of Accounts that are stated to be due in the month of
November or December in any year and are stated to be due more than 90 days from
the invoice date, are more than 60 days past due based upon the terms indicated
in the original invoice and (ii) in the case of all other Accounts, are more
than 90 days past due based upon the terms indicated in the original invoice,
(b) are subject to any Lien, (c) are due to a Subsidiary of the Borrower any
outstanding capital stock of which is subject to a Lien in favor of a Person
other than the Administrative Agent for the ratable benefit of the Lenders, or
(d) are due from an Affiliate, the Borrower or a Subsidiary.

 

“Eligible Inventory” means the aggregate book value of Inventory (including
Inventory in transit), whether now owned or hereafter acquired, to which the
Borrower and/or any of its Subsidiaries

 

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have taken title and which is not (a) work-in-process, (b) subject to any Lien
or (c) owned by a Subsidiary any outstanding capital stock of which is subject
to a Lien in favor of a Person other than the Administrative Agent for the
ratable benefit of the Lenders, after adjusting for reserves for obsolescence,
inventory adjustments and damages (including, but not limited to, foreign
exchange adjustments).

 

“Environmental Laws” means any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and any rule or regulation issued thereunder.

 

“Eurodollar Advance” means an Advance which, except as otherwise provided in
Section 2.11, bears interest at the applicable Eurodollar Rate.

 

“Eurodollar Base Rate” means, with respect to a Eurodollar Advance for the
relevant Interest Period, the applicable British Bankers’ Association LIBOR rate
for deposits in U.S. dollars as reported by any generally recognized financial
information service as of 11:00 a.m. (London time) two Business Days prior to
the first day of such Interest Period, and having a maturity equal to such
Interest Period; provided that, if no such British Bankers’ Association LIBOR
rate is available to the Administrative Agent, the applicable Eurodollar Base
Rate for the relevant Interest Period shall instead be the rate determined by
the Administrative Agent to be the rate at which Bank One or one of its
Affiliate banks offers to place deposits in U.S. dollars with first-class banks
in the interbank market at approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period, in the approximate amount
of Bank One’s relevant Eurodollar Loan and having a maturity equal to such
Interest Period.

 

“Eurodollar Loan” means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the applicable Eurodollar Rate.

 

“Eurodollar Rate” means, with respect to a Eurodollar Advance for the relevant
Interest Period, the sum of (a) the quotient of (i) the Eurodollar Base Rate
applicable to such Interest Period, divided by (ii) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(b) the Applicable Margin.

 

“Excluded Taxes” means, in the case of each Lender or applicable Lending
Installation and the Administrative Agent, taxes imposed on its overall net
income, and franchise taxes imposed on it, by (a) the jurisdiction under the
laws of which such Lender or the Administrative Agent is incorporated or
organized or (b) the jurisdiction in which the Administrative Agent’s or such
Lender’s principal place of business or such Lender’s applicable Lending
Installation is located.

 

“Existing Credit Agreement” means the Credit Agreement, dated as of March 19,
1999, among the Borrower, the lenders and agents parties thereto and JPMorgan
Chase Bank (f/k/a The Chase Manhattan Bank), as the administrative agent (the
“Existing Agent”), as amended.

 

“Exhibit” refers to an exhibit to this Agreement, unless another document is
specifically referenced.

 

“Facility Termination Date” means November 25, 2006, or any earlier date on
which the Aggregate Commitment is reduced to zero or otherwise terminated
pursuant to the terms hereof.

 

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“Facility LC” is defined in Section 2.20.1.

 

“Facility LC Application” is defined in Section 2.20.3.

 

“Facility LC Collateral Account” is defined in Section 2.20.11.

 

“Federal Funds Effective Rate” means, for any day, an interest rate per annum
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any such day which is
a Business Day, the average of the quotations at approximately 10:00 a.m.
(Chicago time) on such day on such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by the
Administrative Agent in its sole discretion.

 

“Floating Rate” means, for any day, a rate per annum equal to (a) the Alternate
Base Rate for such day plus (b) the Applicable Margin, in each case changing
when and as the Alternate Base Rate changes.

 

“Floating Rate Advance” means an Advance which, except as otherwise provided in
Section 2.12, bears interest at the Floating Rate.

 

“Floating Rate Loan” means a Loan which, except as otherwise provided in
Section 2.12, bears interest at the Floating Rate.

 

“Foreign Subsidiary” means any Subsidiary of the Borrower that is not a Domestic
Subsidiary.

 

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

 

“GAAP” means generally accepted accounting principles as in effect from time to
time in the United States, applied in a manner consistent with that used in
preparing the financial statements referred to in Section 5.1.

 

“Governmental Authority” means any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of or
pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).

 

“Guarantee and Collateral Agreement” means the Guarantee and Collateral
Agreement dated as of the Closing Date to be executed and delivered by the
Borrower and each Subsidiary Guarantor, in form and substance acceptable to the
Administrative Agent, as the same may be amended, supplemented or otherwise
modified from time to time.

 

“Guarantee Obligation” as to any Person (the “guaranteeing person”), means any
obligation of (a) the guaranteeing person or (b) another Person (including any
bank under any letter of credit) to induce the creation of which the
guaranteeing person has issued a reimbursement, counterindemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the “primary obligations”)
of any other Person (the “primary obligor”) in any manner,

 

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whether directly or indirectly, including any obligation of the guaranteeing
person, whether or not contingent, (i) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to
advance or supply funds (A) for the purchase or payment of any such primary
obligation or (B) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the owner of any such primary obligation against loss
in respect thereof; provided, however, that the term Guarantee Obligation shall
not include endorsements of instruments for deposit or collection in the
ordinary course of business.  The amount of any Guarantee Obligation of any
guaranteeing person shall be deemed to be the lower of (a) an amount equal to
the stated or determinable amount of the primary obligation in respect of which
such Guarantee Obligation is made and (b) the maximum amount for which such
guaranteeing person may be liable pursuant to the terms of the instrument
embodying such Guarantee Obligation, unless such primary obligation and the
maximum amount for which such guaranteeing person may be liable are not stated
or determinable, in which case the amount of such Guarantee Obligation shall be
such guaranteeing person’s maximum reasonably anticipated liability in respect
thereof as determined by the Borrower in good faith.

 

“Guarantors” means  the collective reference to the Subsidiary Guarantors.

 

“Indebtedness” of any Person at any date means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than
current trade payables incurred in the ordinary course of such Person’s
business), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party under acceptance, letter of credit or similar facilities, (g) the
liquidation value of all redeemable preferred Capital Stock of such Person, (h)
all Guarantee Obligations of such Person in respect of obligations of the kind
referred to in clauses (a) through (g) above, (i) all obligations of the kind
referred to in clauses (a) through (h) above secured by (or for which the holder
of such obligation has an existing right, contingent or otherwise, to be secured
by) any Lien on property (including accounts and contract rights) owned by such
Person, whether or not such Person has assumed or become liable for the payment
of such obligation, and (j) for the purposes of Section 8(e) only, all
obligations of such Person in respect of Rate Management Transactions.

 

“Insolvency” means, with respect to any Multiemployer Plan, the condition that
such Plan is insolvent within the meaning of Section 4245 of ERISA and
“Insolvent” means a condition pertaining to Insolvency.

 

“Intellectual Property” means the collective reference to all rights, priorities
and privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including copyrights,
copyright licenses, patents, patent licenses, trademarks, trademark licenses,
technology, know-how and processes, and all rights to sue at law or in equity
for any infringement or other impairment thereof, including the right to receive
all proceeds and damages therefrom.

 

“Interest Period” means, with respect to a Eurodollar Advance, a period of one,
two, three or six months commencing on a Business Day selected by the Borrower
pursuant to this Agreement.  Such Interest Period shall end on the day which
corresponds numerically to such date one, two, three or six

 

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months thereafter; provided, however, that if there is no such numerically
corresponding day in such next, second, third or sixth succeeding month, such
Interest Period shall end on the last Business Day of such next, second, third
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 calendar month, such Interest Period shall end on
the immediately preceding Business Day.

 

“Inventory” has the meaning set forth in the Uniform Commercial Code.

 

“Investments” is defined in Section 7.7.

 

“LC Fee” is defined in Section 2.20.4.

 

“LC Issuer” means Bank One (or any Affiliate of Bank One designated by Bank One)
in its capacity as issuer of Facility LCs hereunder or any other Lender (or
Affiliate of a Lender) selected from time to time by the Borrower in its sole
discretion to issue Facility LCs hereunder in its capacity as such.

 

“LC Obligations” means, at any time, the sum, without duplication, of (a) the
aggregate undrawn stated amount under all Facility LCs outstanding at such time
plus (b) the aggregate unpaid amount at such time of all Reimbursement
Obligations.

 

“LC Payment Date” is defined in Section 2.20.5.

 

“Lenders” means the lending institutions listed on the signature pages of this
Agreement and their respective successors and assigns.  Unless otherwise
specified, the term “Lenders” includes Bank One in its capacity as Swing Line
Lender.

 

“Lending Installation” means, with respect to a Lender or the Administrative
Agent, the office, branch, subsidiary or affiliate of such Lender or the
Administrative Agent listed on the signature pages hereof or on a Schedule or
otherwise selected by such Lender or the Administrative Agent pursuant to
Section 2.17.

 

“Lien” means any lien (statutory or other), mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance or preference, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever
(including the interest of a vendor or lessor under any conditional sale,
Capitalized Lease or other title retention agreement).

 

“Loan” means a Revolving Loan or a Swing Line Loan.

 

“Loan Documents” means this Agreement, the Facility LC Applications, any Notes
issued pursuant to Section 2.14 and the Collateral Documents.

 

“Loan Parties” means the Borrower and each Subsidiary of the Borrower that is a
party to a Loan Document.

 

“Material Adverse Effect” means a material adverse effect on (a) the business,
Property, condition (financial or otherwise), results of operations, or
prospects of the Borrower and its Subsidiaries taken as a whole, (b) the ability
of the Borrower or any of its Subsidiaries to perform its obligations under the
Loan Documents to which it is a party, or (c) the validity or enforceability of
any of the Loan Documents or the rights or remedies of the Administrative Agent,
the LC Issuer or the Lenders thereunder.

 

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“Material Subsidiary” means any Subsidiary of the Borrower, (a) whose total
assets at the last day of the period of four consecutive fiscal quarters of the
Borrower for which financial statements were most recently delivered pursuant to
Section 6.1, were equal to or greater than 5% of the consolidated total assets
of the Borrower and its Subsidiaries at such date or (b) whose gross revenues
for such period were equal to or greater than 5% of the consolidated gross
revenues of the Borrower and its Subsidiaries for such period, in each case
determined in accordance with GAAP; provided that if, at any time, the
Subsidiaries that would not be Material Subsidiaries pursuant to the foregoing
constitute 10% of such consolidated assets or revenues, a sufficient number of
Subsidiaries shall be designated by the Borrower as “Material Subsidiaries”, and
the actions shall be taken with respect thereto as set forth in Section 6.9 so
that the Subsidiaries that are not Material Subsidiaries and Subsidiary
Guarantors no longer constitute 10% or more of such consolidated assets or
revenue.

 

“Materials of Environmental Concern” means any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products, polychlorinated
biphenyls, urea-formaldehyde insulation, asbestos, pollutants, contaminants,
radioactivity, and any other substances or forces of any kind, whether or not
any such substance or force is defined as hazardous or toxic under any
Environmental Law, that is regulated pursuant to or could give rise to liability
under any Environmental Law.

 

“Modify” and “Modification” are defined in Section 2.20.1.

 

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

 

“Multiemployer Plan” means a Plan maintained pursuant to a collective bargaining
agreement to which the Borrower or any member of the Controlled Group is a party
to which more than one employer is obligated to make contributions.

 

“Net Cash Proceeds” means (a) in connection with any Asset Sale or Recovery
Event, the proceeds thereof in the form of cash and Cash Equivalents (including
any such proceeds received by way of deferred payment of principal pursuant to a
note or installment receivable or purchase price adjustment receivable or
otherwise, but only as and when received) of such Asset Sale or Recovery Event,
net of attorneys’ fees, accountants’ fees, investment banking fees, amounts
required to be applied to the repayment of Indebtedness secured by a Lien
expressly permitted hereunder on any asset that is the subject of such Asset
Sale or Recovery Event, (other than any Lien created pursuant to a Collateral
Document) and other customary fees and expenses actually incurred in connection
therewith and net of taxes paid or reasonably estimated to be payable as a
result thereof and (b) in connection with any Stock Issuance or Subordinated
Debt Issuance, the cash proceeds received from such issuance or incurrence, net
of attorneys’ fees, investment banking fees, accountants’ fees, underwriting
discounts and commissions and other customary fees and expenses actually
incurred in connection therewith.

 

“Non-U.S. Lender” is defined in Section 3.5(iv).

 

“Note” is defined in Section 2.14.

 

“Obligations” means all unpaid principal of and accrued and unpaid interest on
the Loans, all Reimbursement Obligations, 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 or any indemnified party
arising under the Loan Documents.

 

“Other Taxes” is defined in Section 3.5(b).

 

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“Outstanding Credit Exposure” means, as to any Lender at any time, the sum of
(a) the aggregate principal amount of its Revolving Loans outstanding at such
time, plus (b) an amount equal to its Pro Rata Share of the LC Obligations at
such time, plus (c) an amount equal to its Pro Rata Share of the aggregate
principal amount of Swing Line Loans outstanding at such time.

 

“Participants” is defined in Section 13.2.1.

 

“Payment Date” means the last Business Day of each calendar quarter.

 

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

 

“Permitted Acquisition” means any acquisition of property or series of related
acquisitions of property that (a) constitutes assets comprising all or
substantially all of an operating unit of a business or constitutes all or
substantially all of the common stock of a Person and (b) is permitted by and
consummated in compliance with the requirements of Section 7.7(g).

 

“Person” means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.

 

“Plan” means an employee pension benefit plan which is covered by Title IV of
ERISA or subject to the minimum funding standards under Section 412 of the Code
as to which the Borrower or any member of the Controlled Group may have any
liability.

 

“Pledged Stock” is defined in the Guarantee and Collateral Agreement.

 

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

 

“Prime Rate” means a rate per annum equal to the prime rate of interest
announced from time to time by Bank One or its parent (which is not necessarily
the lowest rate charged to any customer), changing when and as said prime rate
changes.

 

“Property” of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.

 

“Pro Rata Share” means, with respect to a Lender, a portion equal to a fraction,
the numerator of which is such Lender’s Commitment and the denominator of which
is the Aggregate Commitment.

 

“Purchasers” is defined in Section 13.3.1.

 

“Rate Management 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 Rate
Management Transactions, and (b) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management Transactions.

 

“Rate Management Transaction” means any transaction (including an agreement with
respect thereto) now existing or hereafter entered by the Borrower or any
Subsidiary which is a rate swap, basis swap, forward rate transaction, commodity
swap, commodity option, equity or equity index swap, bond option, interest rate
option, foreign exchange transaction, cap transaction, floor transaction, collar
transaction, forward transaction, currency swap transaction, cross-currency rate
swap transaction,

 

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currency option or any other similar transaction (including any option with
respect to any of these transactions) or any combination thereof.

 

“Recovery Event” means any settlement or payment in excess of $500,000 in
respect of any property or casualty insurance claim (other than business
interruption insurance claims) or any condemnation proceeding relating to any
Property (other than assets constituting Inventory) of the Borrower or any of
its Subsidiaries.

 

“Regulation D” means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.

 

“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.

 

“Reimbursement Obligations” means, at any time, the aggregate of all obligations
of the Borrower then outstanding under Section 2.20 to reimburse the LC Issuer
for amounts paid by the LC Issuer in respect of any one or more drawings under
Facility LCs.

 

“Reinvestment Deferred Amount” means, with respect to any Reinvestment Event,
that portion of the aggregate Net Cash Proceeds received by the Borrower or any
of its Subsidiaries in connection therewith that, but for the delivery of a
Reinvestment Notice, would have been required to be applied to the prepayment of
Revolving Loans.

 

“Reinvestment Event” means any Asset Sale or Recovery Event in respect of which
the Borrower has delivered a Reinvestment Notice.

 

“Reinvestment Notice” means a written notice executed by an Authorized Officer
stating that no Default has occurred and is continuing and that the Borrower
(directly or indirectly through a Subsidiary) intends and expects to use all or
a specified portion of the Net Cash Proceeds of an Asset Sale or Recovery Event
to acquire assets useful in the Borrower’s or any Subsidiary’s business within
180 days of the applicable Reinvestment Event.

 

“Reinvestment Prepayment Amount” means, with respect to any Reinvestment Event,
the Reinvestment Deferred Amount relating thereto, less any amount expended
prior to the relevant Reinvestment Prepayment Date to acquire assets useful in
the Borrower’s or any Subsidiary’s business.

 

“Reinvestment Prepayment Date” means, with respect to any Reinvestment Event,
the earlier of (a) the date occurring six months after such Reinvestment Event
and (b) the date on which the Borrower shall have determined not to acquire
assets useful in the Borrower’s business with all or any portion of the relevant
Reinvestment Deferred Amount or, in the case of this clause (b) only, such later
dates chosen by the Borrower to coincide with the end of one or more Interest
Periods so long as such later dates are not more than six months after such
Reinvestment Event.

 

“Reorganization” means, with respect to any Multiemployer Plan, the condition
that such plan is in reorganization within the meaning of Section 4241 of ERISA.

 

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“Reportable Event” means a reportable event as defined in Section 4043 of ERISA
and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event; provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or
Section 412(d) of the Code.

 

“Reports” is defined in Section 10.6.

 

“Required Lenders” means Lenders in the aggregate having at least 66 2/3% of the
Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding at least 66 2/3% of the Aggregate Outstanding
Credit Exposure.

 

“Requirement of Law” as to any Person, means the certificate or articles 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 Payments” is defined in Section 7.6.

 

“Reserve Requirement” means, with respect to an Interest Period, the maximum
aggregate reserve requirement (including all basic, supplemental, marginal and
other reserves) which is imposed under Regulation D on Eurocurrency liabilities.

 

“Revolving Loan” means, with respect to a Lender, such Lender’s Pro Rata Share
of all Advances.

 

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

 

“Sale and Leaseback Transaction” means any sale or other transfer of Property by
any Person with the intent to lease such Property as lessee.

 

“Schedule” refers to a specific schedule to this Agreement, unless another
document is specifically referenced.

 

“SEC” means the Securities and Exchange Commission, any successor thereto and
any analogous Governmental Authority.

 

“Section” means a numbered section of this Agreement, unless another document is
specifically referenced.

 

“Secured Obligations” means, collectively, (a) the Obligations and (b) all Rate
Management Obligations owing to one or more Lenders or any Affiliate thereof.

 

“Single Employer Plan” means a Plan (other than a Multiemployer Plan) maintained
by the Borrower or any member of the Controlled Group for employees of the
Borrower or any member of the Controlled Group.

 

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“Solvent” means, when used with respect to any Person, that, as of any date of
determination, (a) the amount of the “present fair saleable value” of the assets
of such Person will, as of such date, exceed the amount of all “liabilities of
such Person, contingent or otherwise”, as of such date, as such quoted terms are
determined in accordance with applicable federal and state laws governing
determinations of the insolvency of debtors, (b) the present fair saleable value
of the assets of such Person will, as of such date, be greater than the amount
that will be required to pay the liability of such Person on its debts as such
debts become absolute and matured, (c) such Person will not have, as of such
date, an unreasonably small amount of capital with which to conduct its
business, and (d) such Person will be able to pay its debts as they mature.  For
purposes of this definition, (i) “debt” means liability on a “claim”, and (ii)
“claim” means any (x) right to payment, whether or not such a right is reduced
to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an
equitable remedy for breach of performance if such breach gives rise to a right
to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured
or unsecured.

 

“Stock Issuance” means the sale or issuance of Capital Stock of the Borrower or
any Subsidiary of the Borrower.

 

“Subordinated Debt Issuance” means the sale or issuance of any Indebtedness of
the Borrower or any of its Subsidiaries, the payment of which is subordinated to
payment of the Secured Obligations on terms and conditions acceptable to the
Required Lenders.

 

“Subsidiary” of a Person means (a) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(b) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled. 
Unless otherwise expressly provided, all references herein to a “Subsidiary”
shall mean a Subsidiary of the Borrower.

 

“Subsidiary Guarantor” means each Subsidiary of the Borrower that is a party to
the Guarantee and Collateral Agreement as a guarantor thereunder (it being
understood that except as required by the definition of “Material Subsidiary”,
Subsidiaries that are not Material Subsidiaries and Subsidiaries that are
Foreign Subsidiaries are not required by this Agreement to become Subsidiary
Guarantors, but may elect to do so).

 

“Subsidiary Stock Event” means the sale or issuance of Capital Stock of any
Subsidiary of the Borrower.

 

“Swing Line Borrowing Notice” is defined in Section 2.5.2.

 

“Swing Line Commitment” means the obligation of the Swing Line Lender to make
Swing Line Loans up to a maximum principal amount of $5,000,000 at any one time
outstanding.

 

“Swing Line Lender” means Bank One or such other Lender which may succeed to its
rights and obligations as Swing Line Lender pursuant to the terms of this
Agreement.

 

“Swing Line Loan” means a Loan made available to the Borrower by the Swing Line
Lender pursuant to Section 2.5.

 

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“Taxes” means any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and any and all liabilities with respect to
the foregoing, but excluding Excluded Taxes and Other Taxes.

 

“Transferee” is defined in Section 13.4.

 

“Type” means, with respect to any Advance, its nature as a Floating Rate Advance
or a Eurodollar Advance and with respect to any Loan, its nature as a Floating
Rate Loan or a Eurodollar Loan.

 

“Uniform Commercial Code” means the Uniform Commercial Code as in effect on the
date hereof and from time to time in the State of New York; provided that if by
reason of mandatory provisions of law, the perfection or the effect of
perfection or non-perfection of the security interests in any Collateral or the
availability of any remedy hereunder is governed by the Uniform Commercial Code
as in effect on or after the date hereof in any other jurisdiction, “Uniform
Commercial Code” means the Uniform Commercial Code as in effect in such other
jurisdiction for purposes of the provisions hereof relating to such perfection
or effect of perfection or non-perfection or availability of such remedy.

 

“Unmatured Default” means an event which but for the lapse of time or the giving
of notice, or both, would constitute a Default.

 

The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms.  Unless otherwise expressly provided herein,
(i) references to agreements (including this Agreement and the other Loan
Documents) and other contractual instruments shall be deemed to include all
subsequent amendments, restatements, supplements and other modifications
thereto, but only to the extent such amendments, restatements, supplements and
other modifications are not prohibited by the terms of any Loan Document, and
(ii) references to any statute or regulation shall be construed as including all
statutory and regulatory provisions amending, replacing, supplementing or
interpreting such statute or regulation.

 

ARTICLE II

 

THE CREDITS

 

2.1                                 COMMITMENT.  FROM AND INCLUDING THE DATE OF
THIS AGREEMENT AND PRIOR TO THE FACILITY TERMINATION DATE, EACH LENDER SEVERALLY
AGREES, ON THE TERMS AND CONDITIONS SET FORTH IN THIS AGREEMENT, TO (A) MAKE
REVOLVING LOANS TO THE BORROWER AND (B) PARTICIPATE IN FACILITY LCS ISSUED UPON
THE REQUEST OF THE BORROWER; PROVIDED THAT, AFTER GIVING EFFECT TO THE MAKING OF
EACH SUCH REVOLVING LOAN AND THE ISSUANCE OF EACH SUCH FACILITY LC, (I) SUCH
LENDER’S OUTSTANDING CREDIT EXPOSURE SHALL NOT EXCEED IN THE AGGREGATE AT ANY
ONE TIME OUTSTANDING THE AMOUNT OF ITS COMMITMENT AND (II) THE AGGREGATE
OUTSTANDING CREDIT EXPOSURE SHALL NOT EXCEED THE AGGREGATE AVAILABLE
COMMITMENT.  SUBJECT TO THE TERMS OF THIS AGREEMENT, THE BORROWER MAY BORROW,
REPAY IN WHOLE OR IN PART AND REBORROW AT ANY TIME PRIOR TO THE FACILITY
TERMINATION DATE.  THE COMMITMENTS TO EXTEND CREDIT HEREUNDER SHALL EXPIRE ON
THE FACILITY TERMINATION DATE.  THE LC ISSUER WILL ISSUE FACILITY LCS HEREUNDER
ON THE TERMS AND CONDITIONS SET FORTH IN SECTION 2.20.

 

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2.2                                 REQUIRED PAYMENTS.

 

2.2.1                        MANDATORY PREPAYMENTS.

 

(A)                                  UNLESS THE REQUIRED LENDERS SHALL OTHERWISE
AGREE, IF ON ANY DATE THE BORROWER OR ANY OF ITS SUBSIDIARIES SHALL RECEIVE NET
CASH PROCEEDS FROM ANY ASSET SALE, RECOVERY EVENT, STOCK ISSUANCE (OTHER THAN
ANY ISSUANCE OR GRANT OF CAPITAL STOCK OF THE BORROWER IN CONNECTION WITH
EQUITY-BASED COMPENSATION) OR SUBORDINATED DEBT ISSUANCE THAT, WHEN ADDED TO THE
AGGREGATE AMOUNT OF SUCH NET CASH PROCEEDS PRIOR THERETO IN THE SAME FISCAL YEAR
OF THE BORROWER, EXCEED $20,000,000, THEN, UNLESS, IN THE CASE OF A REINVESTMENT
EVENT, A REINVESTMENT NOTICE SHALL BE DELIVERED IN RESPECT THEREOF, 100% OF THE
AMOUNT BY WHICH SUCH AGGREGATE NET CASH PROCEEDS RECEIVED DURING SUCH FISCAL
YEAR EXCEED $20,000,000 SHALL BE APPLIED ON SUCH DATE TOWARD THE PREPAYMENT OF
THE REVOLVING LOANS AND THE REDUCTION OF THE COMMITMENTS AS SET FORTH IN
SECTION 2.6; PROVIDED, THAT ON EACH REINVESTMENT PREPAYMENT DATE, AN AMOUNT
EQUAL TO THE REINVESTMENT PREPAYMENT AMOUNT WITH RESPECT TO THE RELEVANT
REINVESTMENT EVENT SHALL BE APPLIED TOWARD THE PREPAYMENT OF THE REVOLVING LOANS
AND THE REDUCTION OF THE COMMITMENTS AS SET FORTH IN SECTION 2.6; PROVIDED,
FURTHER, IN THE CASE OF ANY SUCH REQUIRED PREPAYMENT IN RESPECT OF WHICH A
REINVESTMENT NOTICE HAS NOT BEEN DELIVERED, SUCH PREPAYMENT MAY BE MADE ON A
DATE SUBSEQUENT TO THE DATE OF RECEIPT OF SUCH NET CASH PROCEEDS CHOSEN BY THE
BORROWER TO COINCIDE WITH THE END OF ONE OR MORE INTEREST PERIODS SO LONG AS
SUCH LATER DATE IS NOT MORE THAN SIX MONTHS AFTER SUCH DATE OF RECEIPT OF SUCH
NET CASH PROCEEDS; AND PROVIDED, FURTHER, THAT NO SUCH PREPAYMENT SHALL BE
REQUIRED IF, AT SUCH TIME, THE BORROWER COULD SATISFY THE CONDITIONS TO A CREDIT
EXTENSION SET FORTH IN SECTION 4.2 FOR THE REBORROWING THEREOF.  NOTHING HEREIN
SHALL AFFECT THE OBLIGATIONS OF THE BORROWER UNDER SECTION 2.2.1(B) OR 2.6.2(C).

 

(B)                                 IF ON ANY DATE (I) UNLESS THE REQUIRED
LENDERS SHALL OTHERWISE AGREE, THE AGGREGATE OUTSTANDING CREDIT EXPOSURE EXCEEDS
THE BORROWING BASE OR (II) THE AGGREGATE OUTSTANDING CREDIT EXPOSURE EXCEEDS THE
AGGREGATE COMMITMENT (INCLUDING AFTER GIVING EFFECT TO A REDUCTION IN THE
AGGREGATE COMMITMENT PURSUANT TO SECTION 2.6.2), THEN IN EITHER CASE THE
BORROWER SHALL REPAY IMMEDIATELY ITS THEN OUTSTANDING REVOLVING LOANS IN SUCH
AMOUNT AS MAY BE NECESSARY TO ELIMINATE SUCH EXCESS; PROVIDED, THAT IF AN EXCESS
REMAINS AFTER REPAYMENT OF ALL OUTSTANDING REVOLVING LOANS, THEN THE BORROWER
SHALL CASH COLLATERALIZE THE LC OBLIGATIONS BY DEPOSITING INTO THE FACILITY LC
COLLATERAL ACCOUNT SUCH AMOUNT AS MAY BE NECESSARY TO ELIMINATE SUCH EXCESS.

 

(C)                                  THE BORROWER SHALL REPAY LOANS AND CAUSE
FACILITY LCS TO EXPIRE IN SUCH A WAY SO THAT FOR AT LEAST 30 CONSECUTIVE DAYS
ANNUALLY DURING THE PERIOD BEGINNING NOVEMBER 1 AND ENDING ON MARCH 31 OF EACH
YEAR, THE AGGREGATE OUTSTANDING CREDIT EXPOSURE DOES NOT EXCEED $30,000,000 FOR
SUCH 30-DAY PERIOD.

 

2.2.2                        TERMINATION.  THE AGGREGATE OUTSTANDING CREDIT
EXPOSURE AND ALL OTHER UNPAID OBLIGATIONS SHALL BE PAID IN FULL BY THE BORROWER
ON THE FACILITY TERMINATION DATE.

 

2.3                                 RATABLE LOANS.  EACH ADVANCE HEREUNDER
(OTHER THAN ANY SWING LINE LOAN) SHALL CONSIST OF REVOLVING LOANS MADE FROM THE
SEVERAL LENDERS RATABLY ACCORDING TO THEIR PRO RATA SHARES.

 

2.4                                 TYPES OF ADVANCES.  THE ADVANCES MAY BE
FLOATING RATE ADVANCES OR EURODOLLAR ADVANCES, OR A COMBINATION THEREOF,
SELECTED BY THE BORROWER IN ACCORDANCE WITH SECTIONS 2.9 AND 2.10, OR SWING LINE
LOANS SELECTED BY THE BORROWER IN ACCORDANCE WITH SECTION 2.5.

 

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2.5                                 SWING LINE LOANS.

 

2.5.1                        AMOUNT OF SWING LINE LOANS.  UPON THE SATISFACTION
OF THE CONDITIONS PRECEDENT SET FORTH IN SECTION 4.2 AND, IF SUCH SWING LINE
LOAN IS TO BE MADE ON THE DATE OF THE INITIAL ADVANCE HEREUNDER, THE
SATISFACTION OF THE CONDITIONS PRECEDENT SET FORTH IN SECTION 4.1 AS WELL, FROM
AND INCLUDING THE DATE OF THIS AGREEMENT AND PRIOR TO THE FACILITY TERMINATION
DATE, THE SWING LINE LENDER AGREES, ON THE TERMS AND CONDITIONS SET FORTH IN
THIS AGREEMENT, TO MAKE SWING LINE LOANS TO THE BORROWER FROM TIME TO TIME IN AN
AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED THE SWING LINE COMMITMENT; PROVIDED
THAT THE AGGREGATE OUTSTANDING CREDIT EXPOSURE SHALL NOT AT ANY TIME EXCEED THE
AGGREGATE COMMITMENT.  SUBJECT TO THE TERMS OF THIS AGREEMENT, THE BORROWER MAY
BORROW, REPAY IN WHOLE OR IN PART AND REBORROW SWING LINE LOANS AT ANY TIME
PRIOR TO THE FACILITY TERMINATION DATE.

 

2.5.2                        BORROWING NOTICE.  THE BORROWER SHALL DELIVER TO
THE ADMINISTRATIVE AGENT AND THE SWING LINE LENDER IRREVOCABLE NOTICE (A “SWING
LINE BORROWING NOTICE”) NOT LATER THAN NOON (CHICAGO TIME) ON THE BORROWING DATE
OF EACH SWING LINE LOAN, SPECIFYING (I) THE APPLICABLE BORROWING DATE (WHICH
DATE SHALL BE A BUSINESS DAY), AND (II) THE AGGREGATE AMOUNT OF THE REQUESTED
SWING LINE LOAN WHICH SHALL BE AN AMOUNT NOT LESS THAN $100,000.  THE SWING LINE
LOANS SHALL BEAR INTEREST AT THE FLOATING RATE.

 

2.5.3                        MAKING OF SWING LINE LOANS.  PROMPTLY AFTER RECEIPT
OF A SWING LINE BORROWING NOTICE, THE ADMINISTRATIVE AGENT SHALL NOTIFY EACH
LENDER BY FAX, OR OTHER SIMILAR FORM OF TRANSMISSION, OF THE REQUESTED SWING
LINE LOAN.  NOT LATER THAN 2:00 P.M. (CHICAGO TIME) ON THE APPLICABLE BORROWING
DATE, THE SWING LINE LENDER SHALL MAKE AVAILABLE THE SWING LINE LOAN, IN FUNDS
IMMEDIATELY AVAILABLE IN CHICAGO, TO THE ADMINISTRATIVE AGENT AT ITS ADDRESS
SPECIFIED PURSUANT TO ARTICLE XIV.  THE ADMINISTRATIVE AGENT WILL PROMPTLY MAKE
THE FUNDS SO RECEIVED FROM THE SWING LINE LENDER AVAILABLE TO THE BORROWER ON
THE BORROWING DATE BY CREDITING THE ACCOUNT OF THE BORROWER AT THE
ADMINISTRATIVE AGENT’S AFORESAID ADDRESS OR AS OTHERWISE DIRECTED BY THE
BORROWER.

 

2.5.4                        REPAYMENT OF SWING LINE LOANS.  EACH SWING LINE
LOAN SHALL BE PAID IN FULL BY THE BORROWER ON OR BEFORE THE FIFTH (5TH) BUSINESS
DAY AFTER THE BORROWING DATE FOR SUCH SWING LINE LOAN.  IN ADDITION, THE SWING
LINE LENDER (I) MAY AT ANY TIME IN ITS SOLE DISCRETION WITH RESPECT TO ANY
OUTSTANDING SWING LINE LOAN OR (II) SHALL ON THE FIFTH (5TH) BUSINESS DAY AFTER
THE BORROWING DATE OF ANY SWING LINE LOAN IF NOT REPAID BY THE BORROWER ON SUCH
DATE, REQUIRE EACH LENDER (INCLUDING THE SWING LINE LENDER) TO MAKE A REVOLVING
LOAN IN THE AMOUNT OF SUCH LENDER’S PRO RATA SHARE OF SUCH SWING LINE LOAN
(INCLUDING, WITHOUT LIMITATION, ANY INTEREST ACCRUED AND UNPAID THEREON), FOR
THE PURPOSE OF REPAYING SUCH SWING LINE LOAN.  NOT LATER THAN NOON (CHICAGO
TIME) ON THE DATE OF ANY NOTICE RECEIVED PURSUANT TO THIS SECTION 2.5.4, EACH
LENDER SHALL MAKE AVAILABLE ITS REQUIRED REVOLVING LOAN, IN FUNDS IMMEDIATELY
AVAILABLE IN CHICAGO TO THE ADMINISTRATIVE AGENT AT ITS ADDRESS SPECIFIED
PURSUANT TO ARTICLE XIV.  REVOLVING LOANS MADE PURSUANT TO THIS SECTION 2.5.4
SHALL INITIALLY BE FLOATING RATE LOANS AND THEREAFTER MAY BE CONTINUED AS
FLOATING RATE LOANS OR CONVERTED INTO EURODOLLAR LOANS IN THE MANNER PROVIDED IN
SECTION 2.10 AND SUBJECT TO THE OTHER CONDITIONS AND LIMITATIONS SET FORTH IN
THIS ARTICLE II.  UNLESS A LENDER SHALL HAVE NOTIFIED THE SWING LINE LENDER,
PRIOR TO ITS MAKING ANY SWING LINE LOAN, THAT ANY APPLICABLE CONDITION PRECEDENT
SET FORTH IN SECTIONS 4.1 OR 4.2 HAD NOT THEN BEEN SATISFIED, SUCH LENDER’S
OBLIGATION TO MAKE REVOLVING LOANS PURSUANT TO THIS SECTION 2.5.4 TO REPAY SWING
LINE LOANS SHALL BE UNCONDITIONAL, CONTINUING, IRREVOCABLE AND ABSOLUTE AND
SHALL NOT BE AFFECTED BY ANY CIRCUMSTANCES, INCLUDING, WITHOUT LIMITATION, (A)
ANY SET-OFF, COUNTERCLAIM, RECOUPMENT, DEFENSE OR OTHER RIGHT WHICH SUCH LENDER
MAY HAVE AGAINST THE ADMINISTRATIVE AGENT, THE SWING LINE LENDER OR ANY OTHER
PERSON, (B) THE OCCURRENCE OR

 

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CONTINUANCE OF A DEFAULT OR UNMATURED DEFAULT, (C) ANY ADVERSE CHANGE IN THE
CONDITION (FINANCIAL OR OTHERWISE) OF THE BORROWER, OR (D) ANY OTHER
CIRCUMSTANCES, HAPPENING OR EVENT WHATSOEVER.  IN THE EVENT THAT ANY LENDER
FAILS TO MAKE PAYMENT TO THE ADMINISTRATIVE AGENT OF ANY AMOUNT DUE UNDER THIS
SECTION 2.5.4, THE ADMINISTRATIVE AGENT SHALL BE ENTITLED TO RECEIVE, RETAIN AND
APPLY AGAINST SUCH OBLIGATION THE PRINCIPAL AND INTEREST OTHERWISE PAYABLE TO
SUCH LENDER HEREUNDER UNTIL THE ADMINISTRATIVE AGENT RECEIVES SUCH PAYMENT FROM
SUCH LENDER OR SUCH OBLIGATION IS OTHERWISE FULLY SATISFIED.  IN ADDITION TO THE
FOREGOING, IF FOR ANY REASON ANY LENDER FAILS TO MAKE PAYMENT TO THE
ADMINISTRATIVE AGENT OF ANY AMOUNT DUE UNDER THIS SECTION 2.5.4, SUCH LENDER
SHALL BE DEEMED, AT THE OPTION OF THE ADMINISTRATIVE AGENT, TO HAVE
UNCONDITIONALLY AND IRREVOCABLY PURCHASED FROM THE SWING LINE LENDER, WITHOUT
RECOURSE OR WARRANTY, AN UNDIVIDED INTEREST AND PARTICIPATION IN THE APPLICABLE
SWING LINE LOAN IN THE AMOUNT OF SUCH REVOLVING LOAN, AND SUCH INTEREST AND
PARTICIPATION MAY BE RECOVERED FROM SUCH LENDER TOGETHER WITH INTEREST THEREON
AT THE FEDERAL FUNDS EFFECTIVE RATE FOR EACH DAY DURING THE PERIOD COMMENCING ON
THE DATE OF DEMAND AND ENDING ON THE DATE SUCH AMOUNT IS RECEIVED.  ON THE
FACILITY TERMINATION DATE, THE BORROWER SHALL REPAY IN FULL THE OUTSTANDING
PRINCIPAL BALANCE OF THE SWING LINE LOANS.

 

2.6                                 COMMITMENT FEE; REDUCTIONS AND INCREASES IN
AGGREGATE COMMITMENT.

 

2.6.1                        COMMITMENT FEE.  THE BORROWER AGREES TO PAY TO THE
ADMINISTRATIVE AGENT FOR THE ACCOUNT OF EACH LENDER ACCORDING TO ITS PRO RATA
SHARE A COMMITMENT FEE FOR EACH DAY AT A PER ANNUM RATE EQUAL TO THE APPLICABLE
FEE RATE FOR SUCH DAY MULTIPLIED BY THE DAILY UNUSED PORTION OF SUCH LENDER’S
COMMITMENT FROM THE DATE HEREOF TO AND INCLUDING THE FACILITY TERMINATION DATE,
PAYABLE ON EACH PAYMENT DATE HEREAFTER AND ON THE FACILITY TERMINATION DATE. 
SWING LINE LOANS SHALL NOT COUNT AS USAGE OF ANY LENDER’S COMMITMENT FOR THE
PURPOSES OF CALCULATING THE COMMITMENT FEE DUE HEREUNDER.

 

2.6.2                        REDUCTIONS IN AGGREGATE COMMITMENT.

 

(A)                                  THE BORROWER MAY PERMANENTLY REDUCE THE
AGGREGATE COMMITMENT, IN WHOLE OR IN PART, RATABLY AMONG THE LENDERS IN INTEGRAL
MULTIPLES OF $5,000,000, UPON AT LEAST FIVE (5) BUSINESS DAYS’ WRITTEN NOTICE TO
THE ADMINISTRATIVE AGENT, WHICH NOTICE SHALL SPECIFY THE AMOUNT OF ANY SUCH
REDUCTION; PROVIDED, HOWEVER, THAT THE AMOUNT OF THE AGGREGATE COMMITMENT MAY
NOT BE REDUCED BELOW THE AGGREGATE OUTSTANDING CREDIT EXPOSURE.  ALL ACCRUED
COMMITMENT FEES SHALL BE PAYABLE ON THE EFFECTIVE DATE OF ANY TERMINATION OF THE
OBLIGATIONS OF THE LENDERS TO MAKE CREDIT EXTENSIONS HEREUNDER.

 

(B)                                 SUBJECT TO SECTION 2.6.3, THE AGGREGATE
COMMITMENT SHALL BE AUTOMATICALLY REDUCED TO $75,000,000 ON DECEMBER 31, 2003.

 

(C)                                  IN ADDITION, THE AGGREGATE COMMITMENT SHALL
BE AUTOMATICALLY AND PERMANENTLY REDUCED ON EACH DATE THE BORROWER IS REQUIRED
TO MAKE A PREPAYMENT OF THE REVOLVING LOANS PURSUANT TO SECTION 2.2.1(A) BY AN
AMOUNT EQUAL TO SUCH REQUIRED PAYMENT.

 

2.6.3                        OPTIONAL INCREASE IN AGGREGATE COMMITMENT.  THE
BORROWER MAY, AT ITS OPTION, AT ANY TIME AND FROM TIME TO TIME ON AND AFTER
JANUARY 1, 2004, SEEK TO INCREASE THE AGGREGATE COMMITMENT BY UP TO AN AGGREGATE
AMOUNT OF $25,000,000 (RESULTING IN A MAXIMUM AGGREGATE COMMITMENT OF
$100,000,000) IN A MINIMUM AMOUNT OF $5,000,000 AND IN INTEGRAL MULTIPLES OF
$1,000,000 IN EXCESS THEREOF, UPON AT LEAST THREE (3) BUSINESS DAYS’ PRIOR
WRITTEN NOTICE TO THE ADMINISTRATIVE AGENT, WHICH NOTICE SHALL SPECIFY THE
AMOUNT OF ANY SUCH INCREASE AND SHALL BE DELIVERED AT A TIME WHEN NO DEFAULT OR
UNMATURED DEFAULT HAS OCCURRED AND IS CONTINUING.  THE

 

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BORROWER MAY, AFTER GIVING SUCH NOTICE, OFFER THE INCREASE (WHICH MAY BE
DECLINED BY ANY LENDER IN ITS SOLE DISCRETION) IN THE AGGREGATE COMMITMENT ON
EITHER A RATABLE BASIS TO THE LENDERS OR A NON PRO-RATA BASIS TO ONE OR MORE
LENDERS AND/OR TO OTHER LENDERS OR ENTITIES REASONABLY ACCEPTABLE TO THE
ADMINISTRATIVE AGENT.  NO INCREASE IN THE AGGREGATE COMMITMENT SHALL BECOME
EFFECTIVE UNTIL THE EXISTING OR NEW LENDERS EXTENDING SUCH INCREMENTAL
COMMITMENT AMOUNT AND THE BORROWER SHALL HAVE DELIVERED TO THE ADMINISTRATIVE
AGENT A DOCUMENT IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE
ADMINISTRATIVE AGENT PURSUANT TO WHICH ANY SUCH EXISTING LENDER STATES THE
AMOUNT OF ITS COMMITMENT INCREASE, ANY SUCH NEW LENDER STATES ITS COMMITMENT
AMOUNT AND AGREES TO ASSUME AND ACCEPT THE OBLIGATIONS AND RIGHTS OF A LENDER
HEREUNDER AND THE BORROWER ACCEPTS SUCH INCREMENTAL COMMITMENTS.  THE LENDERS
(NEW OR EXISTING) SHALL ACCEPT AN ASSIGNMENT FROM THE EXISTING LENDERS, AND THE
EXISTING LENDERS SHALL MAKE AN ASSIGNMENT TO THE NEW OR EXISTING LENDER
ACCEPTING A NEW OR INCREASED COMMITMENT, OF AN INTEREST IN EACH THEN OUTSTANDING
ADVANCE SUCH THAT, AFTER GIVING EFFECT THERETO, ALL ADVANCES ARE HELD RATABLY BY
THE LENDERS IN PROPORTION TO THEIR RESPECTIVE COMMITMENTS.  ASSIGNMENTS PURSUANT
TO THE PRECEDING SENTENCE SHALL BE MADE IN EXCHANGE FOR THE PRINCIPAL AMOUNT
ASSIGNED PLUS ACCRUED AND UNPAID INTEREST.  THE BORROWER SHALL MAKE ANY PAYMENTS
UNDER SECTION 3.4 RESULTING FROM SUCH ASSIGNMENTS.  ANY SUCH INCREASE OF THE
AGGREGATE COMMITMENT SHALL BE SUBJECT TO RECEIPT BY THE ADMINISTRATIVE AGENT AND
SUCH NEW LENDERS FROM THE BORROWER OF SUCH SUPPLEMENTAL OPINIONS, RESOLUTIONS,
CERTIFICATES AND OTHER DOCUMENTS AS THE ADMINISTRATIVE AGENT OR SUCH NEW LENDERS
MAY REASONABLY REQUEST; PROVIDED THAT THE SCOPE OF SUCH OPINIONS, RESOLUTIONS,
CERTIFICATES AND OTHER DOCUMENTS SHALL BE SUBSTANTIALLY THE SAME AS THE SCOPE OF
THE OPINIONS, RESOLUTIONS, CERTIFICATES AND OTHER DOCUMENTS DELIVERED ON THE
CLOSING DATE.

 

2.7                                 MINIMUM AMOUNT OF EACH ADVANCE.  EACH
EURODOLLAR ADVANCE (OTHER THAN AN ADVANCE TO REPAY SWING LINE LOANS) SHALL BE IN
THE MINIMUM AMOUNT OF $1,000,000 (AND IN MULTIPLES OF $500,000 IF IN EXCESS
THEREOF), AND EACH FLOATING RATE ADVANCE SHALL BE IN THE MINIMUM AMOUNT OF
$250,000 (AND IN MULTIPLES OF $250,000 IF IN EXCESS THEREOF); PROVIDED, HOWEVER,
THAT ANY FLOATING RATE ADVANCE MAY BE IN THE AMOUNT OF THE UNUSED AGGREGATE
COMMITMENT.

 

2.8                                 OPTIONAL PRINCIPAL PAYMENTS.  THE BORROWER
MAY AT ANY TIME AND FROM TIME TO TIME PAY, WITHOUT PENALTY OR PREMIUM, ALL
OUTSTANDING FLOATING RATE ADVANCES (OTHER THAN SWING LINE LOANS), OR, IN A
MINIMUM AGGREGATE AMOUNT OF $100,000 OR ANY INTEGRAL MULTIPLE OF $50,000 IN
EXCESS THEREOF, ANY PORTION OF THE OUTSTANDING FLOATING RATE ADVANCES (OTHER
THAN SWING LINE LOANS) UPON ONE (1) BUSINESS DAY’S PRIOR NOTICE TO THE
ADMINISTRATIVE AGENT.  THE BORROWER MAY AT ANY TIME PAY, WITHOUT PENALTY OR
PREMIUM, ALL OUTSTANDING SWING LINE LOANS, OR, IN A MINIMUM AMOUNT OF $100,000
AND INCREMENTS OF $50,000 IN EXCESS THEREOF, ANY PORTION OF THE OUTSTANDING
SWING LINE LOANS, WITH NOTICE TO THE ADMINISTRATIVE AGENT AND THE SWING LINE
LENDER BY 11:00 A.M. (CHICAGO TIME) ON THE DATE OF REPAYMENT.  THE BORROWER MAY
FROM TIME TO TIME PAY, SUBJECT TO THE PAYMENT OF ANY FUNDING INDEMNIFICATION
AMOUNTS REQUIRED BY SECTION 3.4 BUT WITHOUT PENALTY OR PREMIUM, ALL OUTSTANDING
EURODOLLAR ADVANCES, OR, IN A MINIMUM AGGREGATE AMOUNT OF $1,000,000 OR ANY
INTEGRAL MULTIPLE OF $500,000 IN EXCESS THEREOF, ANY PORTION OF THE OUTSTANDING
EURODOLLAR ADVANCES UPON THREE (3) BUSINESS DAYS’ PRIOR NOTICE TO THE
ADMINISTRATIVE AGENT.

 

2.9                                 METHOD OF SELECTING TYPES AND INTEREST
PERIODS FOR NEW ADVANCES.  THE BORROWER SHALL SELECT THE TYPE OF ADVANCE AND, IN
THE CASE OF EACH EURODOLLAR ADVANCE, THE INTEREST PERIOD APPLICABLE THERETO FROM
TIME TO TIME.  THE BORROWER SHALL GIVE THE ADMINISTRATIVE AGENT IRREVOCABLE
NOTICE (A “BORROWING NOTICE”) NOT LATER THAN 11:00 A.M. (CHICAGO TIME) ON THE
PROPOSED BORROWING DATE OF EACH FLOATING RATE ADVANCE (OTHER THAN A SWING LINE
LOAN) AND THREE BUSINESS DAYS BEFORE THE BORROWING DATE FOR EACH EURODOLLAR
ADVANCE, SPECIFYING:

 

(I)                                     THE BORROWING DATE, WHICH SHALL BE A
BUSINESS DAY, OF SUCH ADVANCE,

 

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(II)                                  THE AGGREGATE AMOUNT OF SUCH ADVANCE,

 

(III)                               THE TYPE OF ADVANCE SELECTED, AND

 

(IV)                              IN THE CASE OF EACH EURODOLLAR ADVANCE, THE
INTEREST PERIOD APPLICABLE THERETO.

 

Not later than noon (Chicago time) on each Borrowing Date, each Lender shall
make available its Revolving Loan or Revolving Loans in funds immediately
available in Chicago to the Administrative Agent at its address specified
pursuant to Article XIV.  The Administrative Agent will make the funds so
received from the Lenders available to the Borrower as soon as reasonably
practicable by crediting the Borrower’s account at the Administrative Agent’s
aforesaid address or as otherwise directed by the Borrower.

 

2.10                           CONVERSION AND CONTINUATION OF OUTSTANDING
ADVANCES.  FLOATING RATE ADVANCES (OTHER THAN SWING LINE LOANS) SHALL CONTINUE
AS FLOATING RATE ADVANCES UNLESS AND UNTIL SUCH FLOATING RATE ADVANCES ARE
CONVERTED INTO EURODOLLAR ADVANCES PURSUANT TO THIS SECTION 2.10 OR ARE REPAID
IN ACCORDANCE WITH SECTION 2.8.  EACH EURODOLLAR ADVANCE SHALL CONTINUE AS A
EURODOLLAR ADVANCE UNTIL THE END OF THE THEN APPLICABLE INTEREST PERIOD
THEREFOR, AT WHICH TIME SUCH EURODOLLAR ADVANCE SHALL BE AUTOMATICALLY CONVERTED
INTO A FLOATING RATE ADVANCE UNLESS (X) SUCH EURODOLLAR ADVANCE IS OR WAS REPAID
IN ACCORDANCE WITH SECTION 2.8 OR (Y) THE BORROWER SHALL HAVE GIVEN THE
ADMINISTRATIVE AGENT A CONVERSION/CONTINUATION NOTICE (AS DEFINED BELOW)
REQUESTING THAT, AT THE END OF SUCH INTEREST PERIOD, SUCH EURODOLLAR ADVANCE
CONTINUE AS A EURODOLLAR ADVANCE FOR THE SAME OR ANOTHER INTEREST PERIOD. 
SUBJECT TO THE TERMS OF SECTION 2.7, THE BORROWER MAY ELECT FROM TIME TO TIME TO
CONVERT ALL OR ANY PART OF A FLOATING RATE ADVANCE (OTHER THAN SWING LINE LOANS)
INTO A EURODOLLAR ADVANCE.  THE BORROWER SHALL GIVE THE ADMINISTRATIVE AGENT
IRREVOCABLE NOTICE (A “CONVERSION/CONTINUATION NOTICE”) OF EACH CONVERSION OF A
FLOATING RATE ADVANCE INTO A EURODOLLAR ADVANCE OR CONTINUATION OF A EURODOLLAR
ADVANCE NOT LATER THAN 11:00 A.M. (CHICAGO TIME) AT LEAST THREE BUSINESS DAYS
PRIOR TO THE DATE OF THE REQUESTED CONVERSION OR CONTINUATION, SPECIFYING:

 

(I)                                     THE REQUESTED DATE, WHICH SHALL BE A
BUSINESS DAY, OF SUCH CONVERSION OR CONTINUATION,

 

(II)                                  THE AGGREGATE AMOUNT AND TYPE OF THE
ADVANCE WHICH IS TO BE CONVERTED OR CONTINUED, AND

 

(III)                               THE AMOUNT OF SUCH ADVANCE WHICH IS TO BE
CONVERTED INTO OR CONTINUED AS A EURODOLLAR ADVANCE AND THE DURATION OF THE
INTEREST PERIOD APPLICABLE THERETO.

 

2.11                           CHANGES IN INTEREST RATE, ETC.  EACH FLOATING
RATE ADVANCE (OTHER THAN SWING LINE LOANS) SHALL BEAR INTEREST ON THE
OUTSTANDING PRINCIPAL AMOUNT THEREOF, FOR EACH DAY FROM AND INCLUDING THE DATE
SUCH ADVANCE IS MADE OR IS AUTOMATICALLY CONVERTED FROM A EURODOLLAR ADVANCE
INTO A FLOATING RATE ADVANCE PURSUANT TO SECTION 2.10, TO BUT EXCLUDING THE DATE
IT IS PAID OR IS CONVERTED INTO A EURODOLLAR ADVANCE PURSUANT TO SECTION 2.10
HEREOF, AT A RATE PER ANNUM EQUAL TO THE FLOATING RATE FOR SUCH DAY.  EACH SWING
LINE LOAN SHALL BEAR INTEREST ON THE OUTSTANDING PRINCIPAL AMOUNT THEREOF, FOR
EACH DAY FROM AND INCLUDING THE DAY SUCH SWING LINE LOAN IS MADE TO BUT
EXCLUDING THE DATE IT IS PAID, AT A RATE PER ANNUM EQUAL TO THE FLOATING RATE
FOR SUCH DAY.  CHANGES IN THE RATE OF INTEREST ON THAT PORTION OF ANY ADVANCE
MAINTAINED AS A FLOATING RATE ADVANCE WILL TAKE EFFECT SIMULTANEOUSLY WITH EACH
CHANGE IN THE ALTERNATE BASE RATE.  EACH EURODOLLAR ADVANCE SHALL BEAR INTEREST
ON THE OUTSTANDING PRINCIPAL AMOUNT THEREOF FROM AND INCLUDING THE FIRST DAY OF
THE INTEREST PERIOD APPLICABLE THERETO TO (BUT NOT INCLUDING) THE LAST DAY OF
SUCH INTEREST PERIOD AT THE EURODOLLAR RATE APPLICABLE TO SUCH EURODOLLAR
ADVANCE BASED UPON

 

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THE BORROWER’S SELECTIONS UNDER SECTIONS 2.8 AND 2.9 AND OTHERWISE IN ACCORDANCE
WITH THE TERMS HEREOF.  NO INTEREST PERIOD MAY END AFTER THE FACILITY
TERMINATION DATE.

 

2.12                           RATES APPLICABLE AFTER DEFAULT.  NOTWITHSTANDING
ANYTHING TO THE CONTRARY CONTAINED IN SECTION 2.9, 2.10 OR 2.11, DURING THE
CONTINUANCE OF A DEFAULT OR UNMATURED DEFAULT 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 9.2 REQUIRING
UNANIMOUS CONSENT OF THE LENDERS TO CHANGES IN INTEREST RATES), DECLARE THAT NO
ADVANCE MAY BE MADE AS, CONVERTED INTO OR CONTINUED AS A EURODOLLAR ADVANCE. 
DURING THE CONTINUANCE OF A DEFAULT 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 9.2 REQUIRING
UNANIMOUS CONSENT OF THE LENDERS TO CHANGES IN INTEREST RATES), DECLARE THAT (I)
EACH EURODOLLAR ADVANCE SHALL BEAR INTEREST FOR THE REMAINDER OF THE APPLICABLE
INTEREST PERIOD AT THE RATE OTHERWISE APPLICABLE TO SUCH INTEREST PERIOD PLUS 2%
PER ANNUM, (II) EACH FLOATING RATE ADVANCE SHALL BEAR INTEREST AT A RATE PER
ANNUM EQUAL TO THE FLOATING RATE IN EFFECT FROM TIME TO TIME PLUS 2% PER ANNUM
AND (III) THE LC FEE SHALL BE INCREASED BY 2% PER ANNUM; PROVIDED THAT, DURING
THE CONTINUANCE OF A DEFAULT UNDER SECTION 8(F), THE INTEREST RATES SET FORTH IN
CLAUSES (I) AND (II) ABOVE AND THE INCREASE IN THE LC FEE SET FORTH IN CLAUSE
(III) ABOVE SHALL BE APPLICABLE TO ALL CREDIT EXTENSIONS WITHOUT ANY ELECTION OR
ACTION ON THE PART OF THE ADMINISTRATIVE AGENT OR ANY LENDER.

 

2.13                           METHOD OF PAYMENT.  ALL PAYMENTS OF THE
OBLIGATIONS HEREUNDER SHALL BE MADE, WITHOUT SETOFF, DEDUCTION, OR COUNTERCLAIM,
IN IMMEDIATELY AVAILABLE FUNDS TO THE ADMINISTRATIVE AGENT AT THE ADMINISTRATIVE
AGENT’S ADDRESS SPECIFIED PURSUANT TO ARTICLE XIV, OR AT ANY OTHER LENDING
INSTALLATION OF THE ADMINISTRATIVE AGENT SPECIFIED IN WRITING PRIOR TO THE DATE
OF SUCH PAYMENT BY THE ADMINISTRATIVE AGENT TO THE BORROWER, BY NOON (LOCAL
TIME) ON THE DATE WHEN DUE AND SHALL (EXCEPT WITH RESPECT TO REPAYMENTS OF SWING
LINE LOANS AND EXCEPT IN THE CASE OF REIMBURSEMENT OBLIGATIONS FOR WHICH THE LC
ISSUER HAS NOT BEEN FULLY INDEMNIFIED BY THE LENDERS, OR AS OTHERWISE
SPECIFICALLY REQUIRED HEREUNDER) BE APPLIED RATABLY BY THE ADMINISTRATIVE AGENT
AMONG THE LENDERS.  EACH PAYMENT DELIVERED TO THE ADMINISTRATIVE AGENT FOR THE
ACCOUNT OF ANY LENDER SHALL BE DELIVERED PROMPTLY BY THE ADMINISTRATIVE AGENT TO
SUCH LENDER IN THE SAME TYPE OF FUNDS THAT THE ADMINISTRATIVE AGENT RECEIVED AT
ITS ADDRESS SPECIFIED PURSUANT TO ARTICLE XIV OR AT ANY LENDING INSTALLATION
SPECIFIED IN A NOTICE RECEIVED BY THE ADMINISTRATIVE AGENT FROM SUCH LENDER. 
THE ADMINISTRATIVE AGENT IS HEREBY AUTHORIZED TO CHARGE THE ACCOUNT OF THE
BORROWER MAINTAINED WITH BANK ONE FOR EACH PAYMENT OF PRINCIPAL, INTEREST AND
FEES (BUT, ABSENT THE EXISTENCE OF A DEFAULT, NO OTHER AMOUNT DUE HEREUNDER) AS
IT BECOMES DUE HEREUNDER; PROVIDED THAT SO LONG AS NO DEFAULT HAS OCCURRED AND
IS CONTINUING, THE BORROWER MAY REVOKE SUCH AUTHORIZATION BY DELIVERING WRITTEN
NOTICE IN ACCORDANCE WITH SECTION 14.1 HEREOF TO THE ADMINISTRATIVE AGENT AT
LEAST ONE (1) BUSINESS DAY PRIOR TO THE INTENDED DATE OF REVOCATION AND SUCH
AUTHORIZATION SHALL BE AUTOMATICALLY REINSTATED WHILE ANY DEFAULT IS
CONTINUING.  EACH REFERENCE TO THE ADMINISTRATIVE AGENT IN THIS SECTION 2.13
SHALL ALSO BE DEEMED TO REFER, AND SHALL APPLY EQUALLY, TO THE LC ISSUER, IN THE
CASE OF PAYMENTS REQUIRED TO BE MADE BY THE BORROWER TO THE LC ISSUER PURSUANT
TO SECTION 2.20.6.

 

2.14                           Noteless Agreement; Evidence of Indebtedness.

 

(A)                                  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 FROM
TIME TO TIME, INCLUDING THE AMOUNTS OF PRINCIPAL AND INTEREST PAYABLE AND PAID
TO SUCH LENDER FROM TIME TO TIME HEREUNDER.

 

(B)                                 THE ADMINISTRATIVE AGENT SHALL ALSO MAINTAIN
ACCOUNTS IN WHICH IT WILL RECORD (I) THE AMOUNT OF EACH LOAN MADE HEREUNDER, THE
TYPE THEREOF AND THE INTEREST PERIOD WITH RESPECT 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, (III) THE ORIGINAL STATED AMOUNT OF EACH

 

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FACILITY LC AND THE AMOUNT OF LC OBLIGATIONS OUTSTANDING AT ANY TIME, AND (IV)
THE AMOUNT OF ANY SUM RECEIVED BY THE ADMINISTRATIVE AGENT HEREUNDER FROM THE
BORROWER AND EACH LENDER’S SHARE THEREOF.

 

(C)                                  THE ENTRIES MAINTAINED IN THE ACCOUNTS
MAINTAINED PURSUANT TO PARAGRAPHS (A) AND (B) ABOVE SHALL BE PRIMA FACIE
EVIDENCE OF THE EXISTENCE AND AMOUNTS OF THE OBLIGATIONS THEREIN RECORDED;
PROVIDED, HOWEVER, THAT THE FAILURE OF THE ADMINISTRATIVE AGENT OR ANY LENDER TO
MAINTAIN SUCH ACCOUNTS OR ANY ERROR THEREIN SHALL NOT IN ANY MANNER AFFECT THE
OBLIGATION OF THE BORROWER TO REPAY THE OBLIGATIONS IN ACCORDANCE WITH THEIR
TERMS.

 

(D)                                 ANY LENDER MAY REQUEST THAT ITS LOANS BE
EVIDENCED BY A PROMISSORY NOTE OR, IN THE CASE OF THE SWING LINE LENDER,
PROMISSORY NOTES REPRESENTING ITS REVOLVING LOANS AND SWING LINE LOANS,
RESPECTIVELY (EACH, A “NOTE”).  IN SUCH EVENT, THE BORROWER SHALL PREPARE,
EXECUTE AND DELIVER TO SUCH LENDER A NOTE PAYABLE TO THE ORDER OF SUCH LENDER IN
SUBSTANTIALLY THE FORM OF EXHIBIT E.  THEREAFTER, THE LOANS EVIDENCED BY SUCH
NOTE AND INTEREST THEREON SHALL AT ALL TIMES (PRIOR TO ANY ASSIGNMENT PURSUANT
TO SECTION 13.3) BE REPRESENTED BY ONE OR MORE NOTES PAYABLE TO THE ORDER OF THE
PAYEE NAMED THEREIN, EXCEPT TO THE EXTENT THAT ANY SUCH LENDER SUBSEQUENTLY
RETURNS ANY SUCH NOTE FOR CANCELLATION AND REQUESTS THAT SUCH LOANS ONCE AGAIN
BE EVIDENCED AS DESCRIBED IN PARAGRAPHS (A) AND (B) ABOVE.

 

2.15                           TELEPHONIC NOTICES.  THE BORROWER HEREBY
AUTHORIZES THE LENDERS AND THE ADMINISTRATIVE AGENT TO EXTEND, CONVERT OR
CONTINUE ADVANCES, EFFECT SELECTIONS OF TYPES OF ADVANCES AND TO TRANSFER FUNDS
BASED ON TELEPHONIC NOTICES MADE BY ANY PERSON OR PERSONS THE ADMINISTRATIVE
AGENT OR ANY LENDER IN GOOD FAITH BELIEVES TO BE ACTING ON BEHALF OF THE
BORROWER, IT BEING UNDERSTOOD THAT THE FOREGOING AUTHORIZATION IS SPECIFICALLY
INTENDED TO ALLOW BORROWING NOTICES AND CONVERSION/CONTINUATION NOTICES TO BE
GIVEN TELEPHONICALLY.  THE BORROWER AGREES TO DELIVER PROMPTLY TO THE
ADMINISTRATIVE AGENT A WRITTEN CONFIRMATION, IF SUCH CONFIRMATION IS REQUESTED
BY THE ADMINISTRATIVE AGENT OR ANY LENDER, OF EACH TELEPHONIC NOTICE SIGNED BY
AN AUTHORIZED OFFICER.  IF THE WRITTEN CONFIRMATION DIFFERS IN ANY MATERIAL
RESPECT FROM THE ACTION TAKEN BY THE ADMINISTRATIVE AGENT AND THE LENDERS, THE
RECORDS OF THE ADMINISTRATIVE AGENT AND THE LENDERS SHALL GOVERN ABSENT MANIFEST
ERROR.

 

2.16                           INTEREST PAYMENT DATES; INTEREST AND FEE BASIS. 
INTEREST ACCRUED ON EACH FLOATING RATE ADVANCE SHALL BE PAYABLE ON EACH PAYMENT
DATE, COMMENCING WITH THE FIRST SUCH DATE TO OCCUR AFTER THE DATE HEREOF, ON ANY
DATE ON WHICH THE FLOATING RATE ADVANCE IS PREPAID, WHETHER DUE TO ACCELERATION
OR OTHERWISE, AND AT MATURITY.  INTEREST ACCRUED ON THAT PORTION OF THE
OUTSTANDING PRINCIPAL AMOUNT OF ANY FLOATING RATE ADVANCE CONVERTED INTO A
EURODOLLAR ADVANCE ON A DAY OTHER THAN A PAYMENT DATE SHALL BE PAYABLE ON THE
DATE OF CONVERSION.  INTEREST ACCRUED ON EACH EURODOLLAR ADVANCE SHALL BE
PAYABLE ON THE LAST DAY OF ITS APPLICABLE INTEREST PERIOD, ON ANY DATE ON WHICH
THE EURODOLLAR ADVANCE IS PREPAID, WHETHER BY ACCELERATION OR OTHERWISE, AND AT
MATURITY.  INTEREST ACCRUED ON EACH EURODOLLAR ADVANCE HAVING AN INTEREST PERIOD
LONGER THAN THREE MONTHS SHALL ALSO BE PAYABLE ON THE LAST DAY OF EACH
THREE-MONTH INTERVAL DURING SUCH INTEREST PERIOD.  INTEREST ON ALL EURODOLLAR
ADVANCES AND FEES SHALL BE CALCULATED FOR ACTUAL DAYS ELAPSED ON THE BASIS OF A
360-DAY YEAR.  INTEREST ON FLOATING RATE ADVANCES SHALL BE CALCULATED FOR ACTUAL
DAYS ELAPSED ON THE BASIS OF A 365, OR WHEN APPROPRIATE 366, DAY YEAR.  INTEREST
SHALL BE PAYABLE FOR THE DAY AN ADVANCE IS MADE BUT NOT FOR THE DAY OF ANY
PAYMENT ON THE AMOUNT PAID IF PAYMENT IS RECEIVED PRIOR TO NOON (LOCAL TIME) AT
THE PLACE OF PAYMENT.  IF ANY PAYMENT OF PRINCIPAL, INTEREST, FEES OR OTHER
AMOUNTS PAYABLE BY THE BORROWER HEREUNDER SHALL BECOME DUE ON A DAY WHICH IS NOT
A BUSINESS DAY, SUCH PAYMENT SHALL BE MADE ON THE NEXT SUCCEEDING BUSINESS DAY
AND SUCH EXTENSION OF TIME SHALL BE INCLUDED IN COMPUTING INTEREST IN CONNECTION
WITH SUCH PAYMENT.

 

2.17                           NOTIFICATION OF ADVANCES, INTEREST RATES,
PREPAYMENTS AND COMMITMENT REDUCTIONS.  PROMPTLY AFTER RECEIPT THEREOF, THE
ADMINISTRATIVE AGENT WILL NOTIFY EACH LENDER OF THE CONTENTS OF EACH

 

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AGGREGATE COMMITMENT REDUCTION NOTICE, BORROWING NOTICE, SWING LINE BORROWING
NOTICE, CONVERSION/CONTINUATION NOTICE, AND REPAYMENT NOTICE RECEIVED BY IT
HEREUNDER.  PROMPTLY AFTER NOTICE FROM THE LC ISSUER, THE ADMINISTRATIVE AGENT
WILL NOTIFY EACH LENDER OF THE CONTENTS OF EACH REQUEST FOR ISSUANCE OF A
FACILITY LC HEREUNDER.  THE ADMINISTRATIVE AGENT WILL NOTIFY THE BORROWER AND
EACH LENDER OF THE INTEREST RATE APPLICABLE TO EACH EURODOLLAR ADVANCE PROMPTLY
UPON DETERMINATION OF SUCH INTEREST RATE AND WILL GIVE THE BORROWER AND EACH
LENDER PROMPT NOTICE OF EACH CHANGE IN THE ALTERNATE BASE RATE.

 

2.18                           LENDING INSTALLATIONS.  EACH LENDER MAY BOOK ITS
LOANS AND ITS PARTICIPATION IN ANY LC OBLIGATIONS AND THE LC ISSUER MAY BOOK THE
FACILITY LCS AT ANY LENDING INSTALLATION SELECTED BY SUCH LENDER OR THE LC
ISSUER, AS THE CASE MAY BE, AND MAY CHANGE ITS LENDING INSTALLATION FROM TIME TO
TIME.  ALL TERMS OF THIS AGREEMENT SHALL APPLY TO ANY SUCH LENDING INSTALLATION
AND THE LOANS, FACILITY LCS, PARTICIPATIONS IN LC OBLIGATIONS  AND ANY NOTES
ISSUED HEREUNDER SHALL BE DEEMED HELD BY EACH LENDER OR THE LC ISSUER, AS THE
CASE MAY BE, FOR THE BENEFIT OF ANY SUCH LENDING INSTALLATION.  EACH LENDER AND
THE LC ISSUER MAY, BY WRITTEN NOTICE TO THE ADMINISTRATIVE AGENT AND THE
BORROWER IN ACCORDANCE WITH ARTICLE XIV, DESIGNATE REPLACEMENT OR ADDITIONAL
LENDING INSTALLATIONS THROUGH WHICH LOANS WILL BE MADE BY IT OR FACILITY LCS
WILL BE ISSUED BY IT AND FOR WHOSE ACCOUNT LOAN PAYMENTS OR PAYMENTS WITH
RESPECT TO FACILITY LCS ARE TO BE MADE.

 

2.19                           NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE
AGENT.  UNLESS THE BORROWER OR A LENDER, AS THE CASE MAY BE, NOTIFIES THE
ADMINISTRATIVE AGENT PRIOR TO THE DATE ON WHICH IT IS SCHEDULED TO MAKE PAYMENT
TO THE ADMINISTRATIVE AGENT OF (I) IN THE CASE OF A LENDER, THE PROCEEDS OF A
LOAN OR (II) IN THE CASE OF THE BORROWER, A PAYMENT OF PRINCIPAL, INTEREST OR
FEES TO THE ADMINISTRATIVE AGENT FOR THE ACCOUNT OF THE LENDERS, THAT IT DOES
NOT INTEND TO MAKE SUCH PAYMENT, THE ADMINISTRATIVE AGENT MAY ASSUME THAT SUCH
PAYMENT HAS BEEN MADE.  THE ADMINISTRATIVE AGENT MAY, BUT SHALL NOT BE OBLIGATED
TO, MAKE THE AMOUNT OF SUCH PAYMENT AVAILABLE TO THE INTENDED RECIPIENT IN
RELIANCE UPON SUCH ASSUMPTION.  IF SUCH LENDER OR THE BORROWER, AS THE CASE MAY
BE, HAS NOT IN FACT MADE SUCH PAYMENT TO THE ADMINISTRATIVE AGENT, THE RECIPIENT
OF SUCH PAYMENT SHALL, ON DEMAND BY THE ADMINISTRATIVE AGENT, REPAY TO THE
ADMINISTRATIVE AGENT THE AMOUNT SO MADE AVAILABLE TOGETHER WITH INTEREST THEREON
IN RESPECT OF EACH DAY DURING THE PERIOD COMMENCING ON THE DATE SUCH AMOUNT WAS
SO MADE AVAILABLE BY THE ADMINISTRATIVE AGENT UNTIL THE DATE THE ADMINISTRATIVE
AGENT RECOVERS SUCH AMOUNT AT A RATE PER ANNUM EQUAL TO (X) IN THE CASE OF
PAYMENT BY A LENDER, THE FEDERAL FUNDS EFFECTIVE RATE FOR SUCH DAY FOR THE FIRST
THREE DAYS AND, THEREAFTER, THE INTEREST RATE APPLICABLE TO THE RELEVANT LOAN OR
(Y) IN THE CASE OF PAYMENT BY THE BORROWER, THE INTEREST RATE APPLICABLE TO THE
RELEVANT LOAN.

 

2.20                           Facility LCs.

 

2.20.1                  ISSUANCE.  THE LC ISSUER HEREBY AGREES, ON THE TERMS AND
CONDITIONS SET FORTH IN THIS AGREEMENT, TO ISSUE STANDBY AND COMMERCIAL LETTERS
OF CREDIT (EACH, A “FACILITY LC”) AND TO RENEW, EXTEND, INCREASE, DECREASE OR
OTHERWISE MODIFY EACH FACILITY LC (“MODIFY,” AND EACH SUCH ACTION A
“MODIFICATION”), FROM TIME TO TIME FROM AND INCLUDING THE DATE OF THIS AGREEMENT
AND PRIOR TO THE FACILITY TERMINATION DATE UPON THE REQUEST OF AND FOR THE
ACCOUNT OF THE BORROWER; PROVIDED THAT IMMEDIATELY AFTER EACH SUCH FACILITY LC
IS ISSUED OR MODIFIED, (I) THE AGGREGATE AMOUNT OF THE OUTSTANDING LC
OBLIGATIONS SHALL NOT EXCEED THE AGGREGATE COMMITMENT AND (II) THE AGGREGATE
OUTSTANDING CREDIT EXPOSURE SHALL NOT EXCEED THE AGGREGATE COMMITMENT.  NO
FACILITY LC SHALL HAVE AN EXPIRY DATE LATER THAN THE EARLIER OF (X) THE FIFTH
BUSINESS DAY PRIOR TO THE FACILITY TERMINATION DATE AND (Y) ONE YEAR AFTER ITS
ISSUANCE; PROVIDED THAT ANY FACILITY LC WITH A ONE-YEAR TERM MAY PROVIDE FOR THE
RENEWAL THEREOF FOR ADDITIONAL ONE-YEAR PERIODS (WHICH IN NO EVENT SHALL EXTEND
BEYOND THE DATE REFERRED TO IN CLAUSE (X) ABOVE).

 

2.20.2                  PARTICIPATIONS.  UPON THE ISSUANCE OR MODIFICATION BY
THE LC ISSUER OF A FACILITY LC IN ACCORDANCE WITH THIS SECTION 2.20, THE LC
ISSUER SHALL BE DEEMED, WITHOUT FURTHER ACTION BY

 

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ANY PARTY HERETO, TO HAVE UNCONDITIONALLY AND IRREVOCABLY SOLD TO EACH LENDER,
AND EACH LENDER SHALL BE DEEMED, WITHOUT FURTHER ACTION BY ANY PARTY HERETO, TO
HAVE UNCONDITIONALLY AND IRREVOCABLY PURCHASED FROM THE LC ISSUER, A
PARTICIPATION IN SUCH FACILITY LC (AND EACH MODIFICATION THEREOF) AND THE
RELATED LC OBLIGATIONS IN PROPORTION TO ITS PRO RATA SHARE.

 

2.20.3                  NOTICE.  SUBJECT TO SECTION 2.20.1, THE BORROWER SHALL
GIVE THE LC ISSUER NOTICE PRIOR TO 10:00 A.M. (CHICAGO TIME) (A) ON THE PROPOSED
DATE OF ISSUANCE OR MODIFICATION OF  EACH COMMERCIAL FACILITY LC AND (B) TWO
BUSINESS DAYS BEFORE THE PROPOSED DATE OF ISSUANCE OR MODIFICATION OF EACH
STANDBY FACILITY LC, IN EACH CASE SPECIFYING THE BENEFICIARY, THE PROPOSED DATE
OF ISSUANCE (OR MODIFICATION) AND THE EXPIRY DATE OF SUCH FACILITY LC, AND
DESCRIBING THE PROPOSED TERMS OF SUCH FACILITY LC AND THE NATURE OF THE
TRANSACTIONS PROPOSED TO BE SUPPORTED THEREBY.  UPON RECEIPT OF SUCH NOTICE, THE
LC ISSUER SHALL PROMPTLY NOTIFY THE ADMINISTRATIVE AGENT, AND THE ADMINISTRATIVE
AGENT SHALL PROMPTLY NOTIFY EACH LENDER, OF THE CONTENTS THEREOF AND OF THE
AMOUNT OF SUCH LENDER’S PARTICIPATION IN SUCH PROPOSED FACILITY LC.  THE
ISSUANCE OR MODIFICATION BY THE LC ISSUER OF ANY FACILITY LC SHALL, IN ADDITION
TO THE CONDITIONS PRECEDENT SET FORTH IN ARTICLE IV (THE SATISFACTION OF WHICH
THE LC ISSUER SHALL HAVE NO DUTY TO ASCERTAIN), BE SUBJECT TO THE CONDITIONS
PRECEDENT THAT SUCH FACILITY LC SHALL BE SATISFACTORY TO THE LC ISSUER AND THAT
THE BORROWER SHALL HAVE EXECUTED AND DELIVERED SUCH APPLICATION AGREEMENT AND/OR
SUCH OTHER INSTRUMENTS AND AGREEMENTS RELATING TO SUCH FACILITY LC AS THE LC
ISSUER SHALL HAVE REASONABLY REQUESTED (EACH, A “FACILITY LC APPLICATION”).  IN
THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF THIS AGREEMENT AND THE TERMS OF
ANY FACILITY LC APPLICATION, THE TERMS OF THIS AGREEMENT SHALL CONTROL.

 

2.20.4                  FEES.  THE BORROWER SHALL PAY TO THE ADMINISTRATIVE
AGENT, FOR THE ACCOUNT OF THE LENDERS RATABLY IN ACCORDANCE WITH THEIR
RESPECTIVE PRO RATA SHARES, (I) WITH RESPECT TO EACH STANDBY FACILITY LC, A
LETTER OF CREDIT FEE AT A PER ANNUM RATE EQUAL TO THE APPLICABLE FEE RATE FOR
STANDBY FACILITY LCS IN EFFECT FROM TIME TO TIME ON THE AVERAGE DAILY UNDRAWN
STATED AMOUNT UNDER SUCH STANDBY FACILITY LC, SUCH FEE TO BE PAYABLE IN ARREARS
ON EACH PAYMENT DATE, AND (II) WITH RESPECT TO EACH COMMERCIAL FACILITY LC, A
LETTER OF CREDIT FEE AT A PER ANNUM RATE EQUAL TO THE APPLICABLE FEE RATE FOR
COMMERCIAL FACILITY LCS IN EFFECT FROM TIME TO TIME ON THE AVERAGE DAILY UNDRAWN
STATED AMOUNT UNDER SUCH COMMERCIAL FACILITY LC, SUCH FEE TO BE PAYABLE IN
ARREARS ON EACH PAYMENT DATE (EACH SUCH FEE DESCRIBED IN THIS SENTENCE AN “LC
FEE”).  THE BORROWER SHALL ALSO PAY TO THE LC ISSUER FOR ITS OWN ACCOUNT (X) AT
THE TIME OF ISSUANCE (OR ANY MODIFICATION WHICH INCREASES THE FACE AMOUNT OF
SUCH FACILITY LC) OF EACH STANDBY FACILITY LC ISSUED BY BANK ONE, A FRONTING FEE
OF 0.125% OF THE FACE AMOUNT (OR, IN THE CASE OF A MODIFICATION WHICH INCREASES
THE FACE AMOUNT OF A FACILITY LC, 0.125% OF THE AMOUNT OF SUCH INCREASE) OF EACH
SUCH STANDBY FACILITY LC OR, IN THE CASE OF ANY LC ISSUER OTHER THAN BANK ONE, A
FRONTING FEE IN AN AMOUNT TO BE AGREED UPON BETWEEN SUCH LC ISSUER AND THE
BORROWER AND (Y) DOCUMENTARY AND PROCESSING CHARGES IN CONNECTION WITH THE
ISSUANCE OR MODIFICATION OF AND DRAWS UNDER FACILITY LCS IN ACCORDANCE WITH THE
SCHEDULE FOR SUCH CHARGES PREVIOUSLY AGREED TO BY THE LC ISSUER AND THE
BORROWER.

 

2.20.5                  ADMINISTRATION; REIMBURSEMENT BY LENDERS.  UPON RECEIPT
FROM THE BENEFICIARY OF ANY FACILITY LC OF ANY DEMAND FOR PAYMENT UNDER SUCH
FACILITY LC, THE LC ISSUER SHALL PROMPTLY NOTIFY THE ADMINISTRATIVE AGENT AND
THE ADMINISTRATIVE AGENT SHALL PROMPTLY NOTIFY THE BORROWER AND EACH OTHER
LENDER AS TO THE AMOUNT TO BE PAID BY THE LC ISSUER AS A RESULT OF SUCH DEMAND
AND THE PROPOSED PAYMENT DATE (THE “LC PAYMENT DATE”).  THE LC ISSUER WILL USE
COMMERCIALLY REASONABLE EFFORTS TO GIVE SUCH NOTICE NOT LATER THAN THE BUSINESS
DAY FOLLOWING SUCH DEMAND; PROVIDED THAT THE FAILURE TO PROVIDE SUCH NOTICE
SHALL NOT AFFECT THE OBLIGATIONS OF THE BORROWER HEREUNDER.  THE RESPONSIBILITY
OF THE LC ISSUER TO THE BORROWER AND EACH LENDER SHALL BE ONLY TO DETERMINE THAT
THE DOCUMENTS (INCLUDING EACH DEMAND FOR PAYMENT) DELIVERED

 

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UNDER EACH FACILITY LC IN CONNECTION WITH SUCH PRESENTMENT SHALL BE IN
CONFORMITY IN ALL MATERIAL RESPECTS WITH SUCH FACILITY LC.  THE LC ISSUER SHALL
ENDEAVOR TO EXERCISE THE SAME CARE IN THE ISSUANCE AND ADMINISTRATION OF THE
FACILITY LCS AS IT DOES WITH RESPECT TO LETTERS OF CREDIT IN WHICH NO
PARTICIPATIONS ARE GRANTED, IT BEING UNDERSTOOD THAT IN THE ABSENCE OF ANY GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT BY THE LC ISSUER, EACH LENDER SHALL BE
UNCONDITIONALLY AND IRREVOCABLY LIABLE WITHOUT REGARD TO THE OCCURRENCE OF ANY
DEFAULT OR UNMATURED DEFAULT OR ANY CONDITION PRECEDENT WHATSOEVER, TO REIMBURSE
THE LC ISSUER ON DEMAND FOR (I) SUCH LENDER’S PRO RATA SHARE OF THE AMOUNT OF
EACH PAYMENT MADE BY THE LC ISSUER UNDER EACH FACILITY LC TO THE EXTENT SUCH
AMOUNT IS NOT REIMBURSED BY THE BORROWER PURSUANT TO SECTION 2.20.6 BELOW, PLUS
(II) INTEREST ON THE FOREGOING AMOUNT TO BE REIMBURSED BY SUCH LENDER, FOR EACH
DAY FROM THE DATE OF THE LC ISSUER’S DEMAND FOR SUCH REIMBURSEMENT (OR, IF SUCH
DEMAND IS MADE AFTER 11:00 A.M. (CHICAGO TIME) ON SUCH DATE, FROM THE NEXT
SUCCEEDING BUSINESS DAY) TO THE DATE ON WHICH SUCH LENDER PAYS THE AMOUNT TO BE
REIMBURSED BY IT, AT A RATE OF INTEREST PER ANNUM EQUAL TO THE FEDERAL FUNDS
EFFECTIVE RATE FOR THE FIRST THREE DAYS AND, THEREAFTER, AT A RATE OF INTEREST
EQUAL TO THE RATE APPLICABLE TO FLOATING RATE ADVANCES.  EACH LC ISSUER SHALL
PROVIDE THE ADMINISTRATIVE AGENT WITH A LIST OF ALL OUTSTANDING FACILITY LCS AND
ALL OUTSTANDING LC OBLIGATIONS IN RESPECT OF EACH FACILITY LC ISSUED BY IT ON A
WEEKLY BASIS AND AT SUCH OTHER TIMES AS SHALL REASONABLY BE REQUESTED BY THE
ADMINISTRATIVE AGENT.

 

2.20.6                  REIMBURSEMENT BY BORROWER.  THE BORROWER SHALL BE
IRREVOCABLY AND UNCONDITIONALLY OBLIGATED TO REIMBURSE THE LC ISSUER NOT LATER
THAN THE APPLICABLE LC PAYMENT DATE FOR ANY AMOUNTS PAID BY THE LC ISSUER UPON
ANY DRAWING UNDER ANY FACILITY LC, WITHOUT PRESENTMENT, DEMAND, PROTEST OR OTHER
FORMALITIES OF ANY KIND; PROVIDED THAT NEITHER THE BORROWER NOR ANY LENDER SHALL
HEREBY BE PRECLUDED FROM ASSERTING ANY CLAIM FOR DIRECT (BUT NOT CONSEQUENTIAL)
DAMAGES SUFFERED BY THE BORROWER OR SUCH LENDER TO THE EXTENT, BUT ONLY TO THE
EXTENT, CAUSED BY (I) THE WILLFUL MISCONDUCT OR GROSS NEGLIGENCE OF THE LC
ISSUER IN DETERMINING WHETHER A REQUEST PRESENTED UNDER ANY FACILITY LC ISSUED
BY IT COMPLIED WITH THE TERMS OF SUCH FACILITY LC OR (II) THE LC ISSUER’S
FAILURE TO PAY UNDER ANY FACILITY LC ISSUED BY IT AFTER THE PRESENTATION TO IT
OF A REQUEST STRICTLY COMPLYING WITH THE TERMS AND CONDITIONS OF SUCH FACILITY
LC.  ALL SUCH AMOUNTS PAID BY THE LC ISSUER SHALL BEAR INTEREST, PAYABLE ON
DEMAND, FOR EACH DAY AFTER THE LC PAYMENT DATE UNTIL PAID AT A RATE PER ANNUM
EQUAL TO THE SUM OF 2% PLUS THE RATE APPLICABLE TO FLOATING RATE ADVANCES.  THE
LC ISSUER WILL PAY TO EACH LENDER RATABLY IN ACCORDANCE WITH ITS PRO RATA SHARE
ALL AMOUNTS RECEIVED BY IT FROM THE BORROWER FOR APPLICATION IN PAYMENT, IN
WHOLE OR IN PART, OF THE REIMBURSEMENT OBLIGATION IN RESPECT OF ANY FACILITY LC
ISSUED BY THE LC ISSUER, BUT ONLY TO THE EXTENT SUCH LENDER HAS MADE PAYMENT TO
THE LC ISSUER IN RESPECT OF SUCH FACILITY LC PURSUANT TO SECTION 2.20.5. 
SUBJECT TO THE TERMS AND CONDITIONS OF THIS AGREEMENT (INCLUDING WITHOUT
LIMITATION THE SUBMISSION OF A BORROWING NOTICE IN COMPLIANCE WITH SECTION 2.9
AND THE SATISFACTION OF THE APPLICABLE CONDITIONS PRECEDENT SET FORTH IN
ARTICLE IV), THE BORROWER MAY REQUEST AN ADVANCE HEREUNDER FOR THE PURPOSE OF
SATISFYING ANY REIMBURSEMENT OBLIGATION.

 

2.20.7                  OBLIGATIONS ABSOLUTE.  THE BORROWER’S OBLIGATIONS UNDER
THIS SECTION 2.20 SHALL BE ABSOLUTE AND UNCONDITIONAL UNDER ANY AND ALL
CIRCUMSTANCES AND IRRESPECTIVE OF ANY SETOFF, COUNTERCLAIM OR DEFENSE TO PAYMENT
WHICH THE BORROWER MAY HAVE OR HAVE HAD AGAINST THE LC ISSUER, ANY LENDER OR ANY
BENEFICIARY OF A FACILITY LC.  THE BORROWER FURTHER AGREES WITH THE LC ISSUER
AND THE LENDERS THAT THE LC ISSUER AND THE LENDERS SHALL NOT BE RESPONSIBLE FOR,
AND THE BORROWER’S REIMBURSEMENT OBLIGATION IN RESPECT OF ANY FACILITY LC SHALL
NOT BE AFFECTED BY, AMONG OTHER THINGS, THE VALIDITY OR GENUINENESS OF DOCUMENTS
OR OF ANY ENDORSEMENTS THEREON, EVEN IF SUCH DOCUMENTS SHOULD IN FACT PROVE TO
BE IN ANY OR ALL RESPECTS INVALID, FRAUDULENT OR FORGED, OR ANY DISPUTE BETWEEN
OR AMONG THE BORROWER, ANY OF ITS AFFILIATES, THE BENEFICIARY OF ANY FACILITY LC
OR ANY FINANCING INSTITUTION OR OTHER PARTY TO WHOM ANY FACILITY LC MAY BE

 

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TRANSFERRED OR ANY CLAIMS OR DEFENSES WHATSOEVER OF THE BORROWER OR OF ANY OF
ITS AFFILIATES AGAINST THE BENEFICIARY OF ANY FACILITY LC OR ANY SUCH
TRANSFEREE.  THE LC ISSUER SHALL NOT BE LIABLE FOR ANY ERROR, OMISSION,
INTERRUPTION OR DELAY IN TRANSMISSION, DISPATCH OR DELIVERY OF ANY MESSAGE OR
ADVICE, HOWEVER TRANSMITTED, IN CONNECTION WITH ANY FACILITY LC, EXCEPT FOR
ERRORS OR OMISSIONS DETERMINED IN A FINAL NON-APPEALABLE JUDGMENT BY A COURT OF
COMPETENT JURISDICTION TO HAVE RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF THE LC ISSUER.  THE BORROWER AGREES THAT ANY ACTION TAKEN OR
OMITTED BY THE LC ISSUER OR ANY LENDER UNDER OR IN CONNECTION WITH EACH FACILITY
LC AND THE RELATED DRAFTS AND DOCUMENTS, IF DONE WITHOUT GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT, SHALL BE BINDING UPON THE BORROWER AND SHALL NOT PUT THE LC
ISSUER OR ANY LENDER UNDER ANY LIABILITY TO THE BORROWER.  NOTHING IN THIS
SECTION 2.20.7 IS INTENDED TO LIMIT THE RIGHT OF THE BORROWER TO MAKE A CLAIM
AGAINST THE LC ISSUER FOR DAMAGES AS CONTEMPLATED BY THE PROVISO TO THE FIRST
SENTENCE OF SECTION 2.20.6.

 

2.20.8                  ACTIONS OF LC ISSUER.  THE LC ISSUER SHALL BE ENTITLED
TO RELY, AND SHALL BE FULLY PROTECTED IN RELYING, UPON ANY FACILITY LC, DRAFT,
WRITING, RESOLUTION, NOTICE, CONSENT, CERTIFICATE, AFFIDAVIT, LETTER, CABLEGRAM,
TELEGRAM, TELECOPY, TELEX OR TELETYPE MESSAGE, STATEMENT, ORDER OR OTHER
DOCUMENT BELIEVED BY IT TO BE GENUINE AND CORRECT AND TO HAVE BEEN SIGNED, SENT
OR MADE BY THE PROPER PERSON OR PERSONS, AND UPON ADVICE AND STATEMENTS OF LEGAL
COUNSEL, INDEPENDENT ACCOUNTANTS AND OTHER EXPERTS SELECTED BY THE LC ISSUER. 
NOTWITHSTANDING ANY OTHER PROVISION OF THIS SECTION 2.20, THE LC ISSUER SHALL IN
ALL CASES BE FULLY PROTECTED IN ACTING, OR IN REFRAINING FROM ACTING, UNDER THIS
AGREEMENT IN ACCORDANCE WITH A REQUEST OF, OR AT THE DIRECTION OF, THE REQUIRED
LENDERS, AND SUCH REQUEST AND ANY ACTION TAKEN OR FAILURE TO ACT PURSUANT
THERETO SHALL BE BINDING UPON THE LENDERS AND ANY FUTURE HOLDERS OF A
PARTICIPATION IN ANY FACILITY LC.  THE LC ISSUER MAY, AS CONDITION TO TAKING OR
REFUSING TO TAKE ANY ACTION UNDER THIS AGREEMENT, REQUIRE THAT IT SHALL FIRST BE
INDEMNIFIED TO ITS REASONABLE SATISFACTION BY THE LENDERS AGAINST ANY AND ALL
LIABILITY AND EXPENSE WHICH MAY BE INCURRED BY IT BY REASON OF TAKING, REFUSING
OR CONTINUING TO TAKE ANY SUCH ACTION; PROVIDED THAT THIS SECTION 2.20.8 SHALL
NOT AFFECT THE BORROWER’S RIGHTS AGAINST THE LENDERS UNDER THE TERMS OF THIS
AGREEMENT.

 

2.20.9                  INDEMNIFICATION.  THE BORROWER HEREBY AGREES TO
INDEMNIFY AND HOLD HARMLESS EACH LENDER, THE LC ISSUER AND THE ADMINISTRATIVE
AGENT, AND THEIR RESPECTIVE DIRECTORS, OFFICERS, AGENTS AND EMPLOYEES FROM AND
AGAINST ANY AND ALL CLAIMS AND DAMAGES, LOSSES, LIABILITIES, COSTS OR EXPENSES
WHICH SUCH LENDER, THE LC ISSUER OR THE ADMINISTRATIVE AGENT MAY INCUR (OR WHICH
MAY BE CLAIMED AGAINST SUCH LENDER, THE LC ISSUER OR THE ADMINISTRATIVE AGENT BY
ANY PERSON WHATSOEVER) BY REASON OF OR IN CONNECTION WITH THE ISSUANCE,
EXECUTION AND DELIVERY OR TRANSFER OF OR PAYMENT OR FAILURE TO PAY UNDER ANY
FACILITY LC OR ANY ACTUAL OR PROPOSED USE OF ANY FACILITY LC, INCLUDING, WITHOUT
LIMITATION, ANY CLAIMS, DAMAGES, LOSSES, LIABILITIES, COSTS OR EXPENSES WHICH
THE LC ISSUER MAY INCUR BY REASON OF OR IN CONNECTION WITH (I) THE FAILURE OF
ANY OTHER LENDER TO FULFILL OR COMPLY WITH ITS OBLIGATIONS TO THE LC ISSUER
HEREUNDER (BUT NOTHING HEREIN CONTAINED SHALL AFFECT ANY RIGHTS THE BORROWER MAY
HAVE AGAINST ANY DEFAULTING LENDER) OR (II) BY REASON OF OR ON ACCOUNT OF THE LC
ISSUER ISSUING ANY FACILITY LC WHICH SPECIFIES THAT THE TERM “BENEFICIARY”
INCLUDED THEREIN INCLUDES ANY SUCCESSOR BY OPERATION OF LAW OF THE NAMED
BENEFICIARY, BUT WHICH FACILITY LC DOES NOT REQUIRE THAT ANY DRAWING BY ANY SUCH
SUCCESSOR BENEFICIARY BE ACCOMPANIED BY A COPY OF A LEGAL DOCUMENT, SATISFACTORY
TO THE LC ISSUER, EVIDENCING THE APPOINTMENT OF SUCH SUCCESSOR BENEFICIARY;
PROVIDED THAT THE BORROWER SHALL NOT BE REQUIRED TO INDEMNIFY ANY LENDER, THE LC
ISSUER OR THE ADMINISTRATIVE AGENT FOR ANY CLAIMS, DAMAGES, LOSSES, LIABILITIES,
COSTS OR EXPENSES TO THE EXTENT, BUT ONLY TO THE EXTENT, CAUSED BY (X) THE
WILLFUL MISCONDUCT OR GROSS NEGLIGENCE OF THE LC ISSUER IN DETERMINING WHETHER A
REQUEST PRESENTED UNDER ANY FACILITY LC COMPLIED WITH THE TERMS OF SUCH FACILITY
LC OR (Y) THE LC ISSUER’S FAILURE TO PAY UNDER ANY FACILITY LC AFTER THE
PRESENTATION TO IT OF A REQUEST STRICTLY

 

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COMPLYING WITH THE TERMS AND CONDITIONS OF SUCH FACILITY LC. NOTHING IN THIS
SECTION 2.20.9 IS INTENDED TO LIMIT THE OBLIGATIONS OF THE BORROWER UNDER ANY
OTHER PROVISION OF THIS AGREEMENT.

 

2.20.10            LENDERS’ INDEMNIFICATION.  EACH LENDER SHALL, RATABLY IN
ACCORDANCE WITH ITS PRO RATA SHARE, INDEMNIFY THE LC ISSUER, ITS AFFILIATES AND
THEIR RESPECTIVE DIRECTORS, OFFICERS, AGENTS AND EMPLOYEES (TO THE EXTENT NOT
REIMBURSED BY THE BORROWER) AGAINST ANY COST, EXPENSE (INCLUDING REASONABLE
COUNSEL FEES AND DISBURSEMENTS), CLAIM, DEMAND, ACTION, LOSS OR LIABILITY
(EXCEPT SUCH AS RESULT FROM SUCH INDEMNITEES’ GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OR THE LC ISSUER’S FAILURE TO PAY UNDER ANY FACILITY LC AFTER THE
PRESENTATION TO IT OF A REQUEST STRICTLY COMPLYING WITH THE TERMS AND CONDITIONS
OF THE FACILITY LC) THAT SUCH INDEMNITEES MAY SUFFER OR INCUR IN CONNECTION WITH
THIS SECTION 2.20 OR ANY ACTION TAKEN OR OMITTED BY SUCH INDEMNITEES HEREUNDER.

 

2.20.11            FACILITY LC COLLATERAL ACCOUNT.  THE BORROWER AGREES THAT IT
WILL, UPON THE REQUEST OF THE ADMINISTRATIVE AGENT OR THE REQUIRED LENDERS AND
UNTIL THE FINAL EXPIRATION DATE OF ANY FACILITY LC AND THEREAFTER AS LONG AS ANY
AMOUNT IS PAYABLE TO THE LC ISSUER OR THE LENDERS IN RESPECT OF ANY FACILITY LC,
MAINTAIN A SPECIAL COLLATERAL ACCOUNT (THE “FACILITY LC COLLATERAL ACCOUNT”) AT
THE ADMINISTRATIVE AGENT’S OFFICE AT THE ADDRESS SPECIFIED PURSUANT TO
ARTICLE XIV, IN THE NAME OF SUCH BORROWER BUT UNDER THE SOLE DOMINION AND
CONTROL OF THE ADMINISTRATIVE AGENT, FOR THE BENEFIT OF THE LENDERS AND IN WHICH
SUCH BORROWER SHALL HAVE NO INTEREST OTHER THAN AS SET FORTH IN SECTION 9.1. 
THE BORROWER HEREBY PLEDGES, ASSIGNS AND GRANTS TO THE ADMINISTRATIVE AGENT, ON
BEHALF OF AND FOR THE RATABLE BENEFIT OF THE LENDERS AND THE LC ISSUER, A
SECURITY INTEREST IN ALL OF THE BORROWER’S RIGHT, TITLE AND INTEREST IN AND TO
ALL FUNDS WHICH MAY FROM TIME TO TIME BE ON DEPOSIT IN THE FACILITY LC
COLLATERAL ACCOUNT TO SECURE THE PROMPT AND COMPLETE PAYMENT AND PERFORMANCE OF
THE OBLIGATIONS IN ACCORDANCE WITH SECTIONS 2.2.1(B) AND  9.1.  THE
ADMINISTRATIVE AGENT WILL INVEST ANY FUNDS ON DEPOSIT FROM TIME TO TIME IN THE
FACILITY LC COLLATERAL ACCOUNT IN CERTIFICATES OF DEPOSIT OF BANK ONE HAVING A
MATURITY NOT EXCEEDING 30 DAYS.  NOTHING IN THIS SECTION 2.20.11 SHALL EITHER
OBLIGATE THE ADMINISTRATIVE AGENT TO REQUIRE THE BORROWER TO DEPOSIT ANY FUNDS
IN THE FACILITY LC COLLATERAL ACCOUNT OR LIMIT THE RIGHT OF THE ADMINISTRATIVE
AGENT TO RELEASE ANY FUNDS HELD IN THE FACILITY LC COLLATERAL ACCOUNT IN EACH
CASE OTHER THAN AS REQUIRED BY THIS AGREEMENT.

 

2.20.12            RIGHTS AS A LENDER.  IN ITS CAPACITY AS A LENDER, THE LC
ISSUER SHALL HAVE THE SAME RIGHTS AND OBLIGATIONS AS ANY OTHER LENDER.

 

2.21                           REPLACEMENT OF LENDER.  IF THE BORROWER IS
REQUIRED PURSUANT TO SECTION 3.1, 3.2 OR 3.5 TO MAKE ANY ADDITIONAL PAYMENT TO
ANY LENDER OR IF ANY LENDER’S OBLIGATION TO MAKE OR CONTINUE, OR TO CONVERT
FLOATING RATE ADVANCES INTO, EURODOLLAR ADVANCES SHALL BE SUSPENDED PURSUANT TO
SECTION 3.3 (ANY LENDER SO AFFECTED AN “AFFECTED LENDER”), THE BORROWER MAY
ELECT, IF SUCH AMOUNTS CONTINUE TO BE CHARGED OR SUCH SUSPENSION IS STILL
EFFECTIVE, TO REPLACE SUCH AFFECTED LENDER AS A LENDER PARTY TO THIS AGREEMENT;
PROVIDED THAT NO DEFAULT OR UNMATURED DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING AT THE TIME OF SUCH REPLACEMENT; PROVIDED FURTHER 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 ADVANCES AND OTHER OBLIGATIONS DUE TO THE
AFFECTED LENDER PURSUANT TO AN ASSIGNMENT SUBSTANTIALLY IN THE FORM OF EXHIBIT C
AND TO BECOME A LENDER FOR ALL PURPOSES UNDER THIS AGREEMENT AND TO ASSUME ALL
OBLIGATIONS OF THE AFFECTED LENDER TO BE TERMINATED AS OF SUCH DATE AND TO
COMPLY WITH THE REQUIREMENTS OF SECTION 13.3 APPLICABLE TO ASSIGNMENTS, AND (II)
THE BORROWER SHALL PAY TO SUCH AFFECTED LENDER IN SAME DAY FUNDS ON THE DAY OF
SUCH REPLACEMENT (A) ALL INTEREST, FEES AND OTHER AMOUNTS THEN ACCRUED BUT
UNPAID TO SUCH AFFECTED LENDER BY THE BORROWER HEREUNDER TO AND INCLUDING THE
DATE OF TERMINATION, INCLUDING WITHOUT LIMITATION PAYMENTS DUE TO SUCH AFFECTED
LENDER UNDER SECTIONS 3.1, 3.2 AND 3.5, AND (B) AN AMOUNT, IF ANY, EQUAL TO THE
PAYMENT WHICH WOULD HAVE BEEN

 

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DUE TO SUCH LENDER ON THE DAY OF SUCH REPLACEMENT UNDER SECTION 3.4 HAD THE
LOANS OF SUCH AFFECTED LENDER BEEN PREPAID ON SUCH DATE RATHER THAN SOLD TO THE
REPLACEMENT LENDER.

 

ARTICLE III

 

YIELD PROTECTION; TAXES

 

3.1                                 YIELD PROTECTION.  IF, ON OR AFTER THE DATE
OF THIS AGREEMENT, THE ADOPTION OF ANY LAW OR ANY GOVERNMENTAL OR
QUASI-GOVERNMENTAL RULE, REGULATION, POLICY, GUIDELINE OR DIRECTIVE (WHETHER OR
NOT HAVING THE FORCE OF LAW), OR ANY CHANGE IN THE INTERPRETATION OR
ADMINISTRATION THEREOF BY ANY GOVERNMENTAL OR QUASI-GOVERNMENTAL AUTHORITY,
CENTRAL BANK OR COMPARABLE AGENCY CHARGED WITH THE INTERPRETATION OR
ADMINISTRATION THEREOF, OR COMPLIANCE BY ANY LENDER OR APPLICABLE LENDING
INSTALLATION OR THE LC ISSUER WITH ANY REQUEST OR DIRECTIVE (WHETHER OR NOT
HAVING THE FORCE OF LAW) OF ANY SUCH AUTHORITY, CENTRAL BANK OR COMPARABLE
AGENCY:

 

(A)                                  IMPOSES OR INCREASES OR DEEMS APPLICABLE
ANY RESERVE, ASSESSMENT, INSURANCE CHARGE, SPECIAL DEPOSIT OR SIMILAR
REQUIREMENT AGAINST ASSETS OF, DEPOSITS WITH OR FOR THE ACCOUNT OF, OR CREDIT
EXTENDED BY, ANY LENDER OR ANY APPLICABLE LENDING INSTALLATION OR THE LC ISSUER
(OTHER THAN RESERVES AND ASSESSMENTS TAKEN INTO ACCOUNT IN DETERMINING THE
INTEREST RATE APPLICABLE TO EURODOLLAR ADVANCES), OR

 

(B)                                 IMPOSES ANY OTHER CONDITION,

 

and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation or the LC Issuer, as the case may be, by an
amount that such Lender or applicable Lending Installation or the LC Issuer
reasonably deems material, of making or maintaining its Eurodollar Loans or
Commitment or of issuing or participating in Facility LCs or to reduce the
return received by such Lender or applicable Lending Installation or the LC
Issuer, as the case may be, in connection with such Eurodollar Loans,
Commitment, Facility LCs or participations therein, then, within 15 days of
demand by such Lender or the LC Issuer, as the case may be, the Borrower shall
pay such Lender or the LC Issuer, as the case may be, such additional amount or
amounts as will compensate such Lender or the LC Issuer, as the case may be, for
such increased cost or reduction in amount received.

 

3.2                                 CHANGES IN CAPITAL ADEQUACY REGULATIONS.  IF
A LENDER OR THE LC ISSUER DETERMINES THE AMOUNT OF CAPITAL REQUIRED OR EXPECTED
TO BE MAINTAINED BY SUCH LENDER OR THE LC ISSUER, ANY LENDING INSTALLATION OF
SUCH LENDER OR THE LC ISSUER, OR ANY CORPORATION CONTROLLING SUCH LENDER OR THE
LC ISSUER IS INCREASED AS A RESULT OF A CHANGE, THEN, WITHIN 15 DAYS OF DEMAND
BY SUCH LENDER OR THE LC ISSUER, THE BORROWER SHALL PAY SUCH LENDER OR THE LC
ISSUER THE AMOUNT NECESSARY TO COMPENSATE FOR ANY SHORTFALL IN THE RATE OF
RETURN ON THE PORTION OF SUCH INCREASED CAPITAL WHICH SUCH LENDER OR THE LC
ISSUER DETERMINES IS ATTRIBUTABLE TO THIS AGREEMENT, ITS OUTSTANDING CREDIT
EXPOSURE OR ITS COMMITMENT TO MAKE LOANS AND ISSUE OR PARTICIPATE IN FACILITY
LCS, AS THE CASE MAY BE, HEREUNDER (AFTER TAKING INTO ACCOUNT SUCH LENDER’S OR
THE LC ISSUER’S POLICIES AS TO CAPITAL ADEQUACY).  “CHANGE” MEANS (A) ANY CHANGE
AFTER THE DATE OF THIS AGREEMENT IN THE RISK-BASED CAPITAL GUIDELINES OR (B) ANY
ADOPTION OF OR CHANGE IN ANY OTHER LAW, GOVERNMENTAL OR QUASI-GOVERNMENTAL RULE,
REGULATION, POLICY, GUIDELINE, INTERPRETATION, OR DIRECTIVE (WHETHER OR NOT
HAVING THE FORCE OF LAW) AFTER THE DATE OF THIS AGREEMENT WHICH AFFECTS THE
AMOUNT OF CAPITAL REQUIRED OR EXPECTED TO BE MAINTAINED BY ANY LENDER OR THE LC
ISSUER OR ANY LENDING INSTALLATION OR ANY CORPORATION CONTROLLING ANY LENDER OR
THE LC ISSUER.  “RISK-BASED CAPITAL GUIDELINES” MEANS (A) THE RISK-BASED CAPITAL
GUIDELINES IN EFFECT IN THE UNITED STATES ON THE DATE OF THIS AGREEMENT,
INCLUDING TRANSITION RULES, AND (B) THE CORRESPONDING CAPITAL REGULATIONS
PROMULGATED BY REGULATORY AUTHORITIES OUTSIDE THE UNITED STATES IMPLEMENTING THE
JULY 1988 REPORT OF THE BASLE COMMITTEE ON BANKING REGULATION AND SUPERVISORY
PRACTICES ENTITLED “INTERNATIONAL CONVERGENCE OF CAPITAL MEASUREMENTS AND

 

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CAPITAL STANDARDS,” INCLUDING TRANSITION RULES, AND ANY AMENDMENTS TO SUCH
REGULATIONS ADOPTED PRIOR TO THE DATE OF THIS AGREEMENT.

 

3.3                                 AVAILABILITY OF TYPES OF ADVANCES.  IF ANY
LENDER DETERMINES THAT MAINTENANCE OF ITS EURODOLLAR LOANS AT A SUITABLE LENDING
INSTALLATION WOULD VIOLATE ANY APPLICABLE LAW OR ANY GOVERNMENTAL OR
QUASI-GOVERNMENTAL RULE, REGULATION, OR DIRECTIVE, WHETHER OR NOT HAVING THE
FORCE OF LAW, OR IF THE REQUIRED LENDERS DETERMINE THAT (A) DEPOSITS OF A TYPE
AND MATURITY APPROPRIATE TO MATCH FUND EURODOLLAR ADVANCES ARE NOT AVAILABLE OR
(B) THE INTEREST RATE APPLICABLE TO EURODOLLAR ADVANCES DOES NOT ACCURATELY
REFLECT THE COST OF MAKING OR MAINTAINING EURODOLLAR ADVANCES, THEN THE
ADMINISTRATIVE AGENT SHALL SUSPEND THE AVAILABILITY OF EURODOLLAR ADVANCES AND
REQUIRE ANY AFFECTED EURODOLLAR ADVANCES TO BE REPAID OR CONVERTED TO FLOATING
RATE ADVANCES, SUBJECT TO THE PAYMENT OF ANY FUNDING INDEMNIFICATION AMOUNTS
REQUIRED BY SECTION 3.4.

 

3.4                                 FUNDING INDEMNIFICATION.  IF ANY PAYMENT OF
A EURODOLLAR ADVANCE OCCURS ON A DATE WHICH IS NOT THE LAST DAY OF THE
APPLICABLE INTEREST PERIOD, WHETHER BECAUSE OF ACCELERATION, PREPAYMENT OR
OTHERWISE, OR A EURODOLLAR ADVANCE IS NOT MADE ON THE DATE SPECIFIED BY THE
BORROWER FOR ANY REASON OTHER THAN DEFAULT BY THE LENDERS, THE BORROWER WILL
INDEMNIFY EACH LENDER FOR ANY LOSS OR COST INCURRED BY IT RESULTING THEREFROM,
INCLUDING, WITHOUT LIMITATION, ANY LOSS OR COST IN LIQUIDATING OR EMPLOYING
DEPOSITS ACQUIRED TO FUND OR MAINTAIN SUCH EURODOLLAR ADVANCE.

 

3.5                                 Taxes.

 

(A)                                  ALL PAYMENTS BY THE BORROWER TO OR FOR THE
ACCOUNT OF ANY LENDER, THE LC ISSUER OR THE ADMINISTRATIVE AGENT HEREUNDER OR
UNDER ANY OTHER LOAN DOCUMENT SHALL BE MADE FREE AND CLEAR OF AND WITHOUT
DEDUCTION FOR ANY AND ALL TAXES.  IF ANY TAXES ARE REQUIRED TO BE WITHHELD FROM
OR IN RESPECT OF ANY SUM PAYABLE HEREUNDER TO ANY LENDER, THE LC ISSUER OR THE
ADMINISTRATIVE AGENT, (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 3.5) SUCH LENDER, THE LC ISSUER OR
THE ADMINISTRATIVE AGENT (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, (III) THE BORROWER SHALL PAY THE FULL AMOUNT
DEDUCTED TO THE RELEVANT AUTHORITY IN ACCORDANCE WITH APPLICABLE LAW AND (IV)
THE BORROWER SHALL FURNISH TO THE ADMINISTRATIVE AGENT THE ORIGINAL COPY OF A
RECEIPT EVIDENCING PAYMENT THEREOF AS SOON AS PRACTICABLE AFTER SUCH PAYMENT IS
MADE.

 

(B)                                 IN ADDITION, THE BORROWER HEREBY AGREES TO
PAY ANY PRESENT OR FUTURE STAMP OR DOCUMENTARY TAXES AND ANY OTHER EXCISE OR
PROPERTY TAXES, CHARGES OR SIMILAR LEVIES WHICH ARISE FROM ANY PAYMENT MADE
HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT OR FROM THE EXECUTION OR DELIVERY OF,
OR OTHERWISE WITH RESPECT TO, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT (“OTHER
TAXES”).

 

(C)                                  THE BORROWER HEREBY AGREES TO INDEMNIFY THE
ADMINISTRATIVE AGENT, THE LC ISSUER AND EACH LENDER FOR THE FULL AMOUNT OF TAXES
OR OTHER TAXES (INCLUDING, WITHOUT LIMITATION, ANY TAXES OR OTHER TAXES IMPOSED
ON AMOUNTS PAYABLE UNDER THIS SECTION 3.5) PAID BY THE ADMINISTRATIVE AGENT, THE
LC ISSUER  OR SUCH LENDER AS A RESULT OF ITS COMMITMENT, ANY LOANS MADE BY IT
HEREUNDER, OR OTHERWISE IN CONNECTION WITH ITS PARTICIPATION IN THIS AGREEMENT
AND ANY LIABILITY (INCLUDING PENALTIES, INTEREST AND EXPENSES) ARISING THEREFROM
OR WITH RESPECT THERETO.  PAYMENTS DUE UNDER THIS INDEMNIFICATION SHALL BE MADE
WITHIN 30 DAYS OF THE DATE THE ADMINISTRATIVE AGENT, THE LC ISSUER OR SUCH
LENDER MAKES DEMAND THEREFOR PURSUANT TO SECTION 3.6.

 

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(D)                                 EACH LENDER THAT IS NOT INCORPORATED UNDER
THE LAWS OF THE UNITED STATES OF AMERICA OR A STATE THEREOF (EACH A “NON-U.S.
LENDER”) AGREES THAT IT WILL, ON OR BEFORE THE DATE IT BECOMES A PARTY TO THIS
AGREEMENT, (I) DELIVER TO THE ADMINISTRATIVE AGENT TWO DULY COMPLETED COPIES OF
UNITED STATES INTERNAL REVENUE SERVICE FORM W-8BEN OR W-8ECI, CERTIFYING IN
EITHER CASE THAT SUCH LENDER IS ENTITLED TO RECEIVE PAYMENTS UNDER THIS
AGREEMENT WITHOUT DEDUCTION OR WITHHOLDING OF ANY UNITED STATES FEDERAL INCOME
TAXES, AND (II) DELIVER TO THE ADMINISTRATIVE AGENT A UNITED STATES INTERNAL
REVENUE SERVICE FORM W-8 OR W-9, AS THE CASE MAY BE, AND CERTIFY THAT IT IS
ENTITLED TO AN EXEMPTION FROM UNITED STATES BACKUP WITHHOLDING TAX.  EACH
NON-U.S. LENDER FURTHER UNDERTAKES TO DELIVER TO EACH OF THE BORROWER AND THE
ADMINISTRATIVE AGENT (X) RENEWALS OR ADDITIONAL COPIES OF SUCH FORM (OR ANY
SUCCESSOR FORM) ON OR BEFORE THE DATE THAT SUCH FORM EXPIRES OR BECOMES
OBSOLETE, AND (Y) AFTER THE OCCURRENCE OF ANY EVENT REQUIRING A CHANGE IN THE
MOST RECENT FORMS SO DELIVERED BY IT, SUCH ADDITIONAL FORMS OR AMENDMENTS
THERETO AS MAY BE REASONABLY REQUESTED BY THE BORROWER OR THE ADMINISTRATIVE
AGENT.  ALL FORMS OR AMENDMENTS DESCRIBED IN THE PRECEDING SENTENCE SHALL
CERTIFY THAT SUCH LENDER IS ENTITLED TO RECEIVE PAYMENTS UNDER THIS AGREEMENT
WITHOUT DEDUCTION OR WITHHOLDING OF ANY UNITED STATES FEDERAL INCOME TAXES,
UNLESS AN EVENT WHICH HAS NOT BEEN CAUSED OR INITIATED BY SUCH LENDER (INCLUDING
WITHOUT LIMITATION ANY CHANGE IN TREATY, LAW OR REGULATION) HAS OCCURRED PRIOR
TO THE DATE ON WHICH ANY SUCH DELIVERY WOULD OTHERWISE BE REQUIRED WHICH RENDERS
ALL SUCH FORMS INAPPLICABLE OR WHICH WOULD PREVENT SUCH LENDER FROM DULY
COMPLETING AND DELIVERING ANY SUCH FORM OR AMENDMENT WITH RESPECT TO IT AND SUCH
LENDER ADVISES THE BORROWER AND THE ADMINISTRATIVE AGENT THAT IT IS NOT CAPABLE
OF RECEIVING PAYMENTS WITHOUT ANY DEDUCTION OR WITHHOLDING OF UNITED STATES
FEDERAL INCOME TAX.

 

(E)                                  FOR ANY PERIOD DURING WHICH A NON-U.S.
LENDER HAS FAILED TO PROVIDE THE BORROWER WITH AN APPROPRIATE FORM PURSUANT TO
CLAUSE (D) ABOVE (UNLESS SUCH FAILURE IS DUE TO A CHANGE IN TREATY, LAW OR
REGULATION, OR ANY CHANGE IN THE INTERPRETATION OR ADMINISTRATION THEREOF BY ANY
GOVERNMENTAL AUTHORITY, OCCURRING SUBSEQUENT TO THE DATE ON WHICH A FORM
ORIGINALLY WAS REQUIRED TO BE PROVIDED), SUCH NON-U.S. LENDER SHALL NOT BE
ENTITLED TO INDEMNIFICATION UNDER THIS SECTION 3.5 WITH RESPECT TO TAXES IMPOSED
BY THE UNITED STATES; PROVIDED THAT, SHOULD A NON-U.S. LENDER WHICH IS OTHERWISE
EXEMPT FROM OR SUBJECT TO A REDUCED RATE OF WITHHOLDING TAX BECOME SUBJECT TO
TAXES BECAUSE OF ITS FAILURE TO DELIVER A FORM REQUIRED UNDER CLAUSE (D) ABOVE,
THE BORROWER SHALL TAKE SUCH STEPS AS SUCH NON-U.S. LENDER SHALL REASONABLY
REQUEST TO ASSIST SUCH NON-U.S. LENDER TO RECOVER SUCH TAXES.

 

(F)                                    ANY LENDER THAT IS ENTITLED TO AN
EXEMPTION FROM OR REDUCTION OF WITHHOLDING TAX WITH RESPECT TO PAYMENTS UNDER
THIS AGREEMENT OR ANY NOTE PURSUANT TO THE LAW OF ANY RELEVANT JURISDICTION OR
ANY TREATY 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 AS WILL PERMIT
SUCH PAYMENTS TO BE MADE WITHOUT WITHHOLDING OR AT A REDUCED RATE.

 

(G)                                 IF THE U.S. INTERNAL REVENUE SERVICE OR ANY
OTHER GOVERNMENTAL AUTHORITY OF THE UNITED STATES OR ANY OTHER COUNTRY OR ANY
POLITICAL SUBDIVISION THEREOF ASSERTS A CLAIM THAT THE ADMINISTRATIVE AGENT DID
NOT PROPERLY WITHHOLD TAX FROM AMOUNTS PAID TO OR FOR THE ACCOUNT OF ANY LENDER
(BECAUSE THE APPROPRIATE FORM WAS NOT DELIVERED OR PROPERLY COMPLETED, BECAUSE
SUCH LENDER FAILED TO NOTIFY THE ADMINISTRATIVE AGENT OF A CHANGE IN
CIRCUMSTANCES WHICH RENDERED ITS EXEMPTION FROM WITHHOLDING INEFFECTIVE, OR FOR
ANY OTHER REASON), SUCH LENDER SHALL INDEMNIFY THE ADMINISTRATIVE AGENT FULLY
FOR ALL AMOUNTS PAID, DIRECTLY OR INDIRECTLY, BY THE ADMINISTRATIVE AGENT AS
TAX, WITHHOLDING THEREFOR, OR OTHERWISE, INCLUDING PENALTIES AND INTEREST, AND
INCLUDING TAXES IMPOSED BY ANY JURISDICTION ON AMOUNTS PAYABLE TO THE
ADMINISTRATIVE AGENT UNDER THIS SUBSECTION, TOGETHER WITH ALL COSTS AND EXPENSES
RELATED THERETO (INCLUDING ATTORNEYS

 

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FEES AND TIME CHARGES OF ATTORNEYS FOR THE ADMINISTRATIVE AGENT, WHICH ATTORNEYS
MAY BE EMPLOYEES OF THE ADMINISTRATIVE AGENT).  THE OBLIGATIONS OF THE LENDERS
UNDER THIS SECTION 3.5(VII) SHALL SURVIVE THE PAYMENT OF THE OBLIGATIONS AND
TERMINATION OF THIS AGREEMENT.

 

3.6                                 LENDER STATEMENTS; SURVIVAL OF INDEMNITY. TO
THE EXTENT REASONABLY POSSIBLE, EACH LENDER SHALL DESIGNATE AN ALTERNATE LENDING
INSTALLATION WITH RESPECT TO ITS EURODOLLAR LOANS TO REDUCE ANY LIABILITY OF THE
BORROWER TO SUCH LENDER UNDER SECTIONS 3.1, 3.2 AND 3.5 OR TO AVOID THE
UNAVAILABILITY OF EURODOLLAR ADVANCES UNDER SECTION 3.3, SO LONG AS SUCH
DESIGNATION IS NOT, IN THE JUDGMENT OF SUCH LENDER, DISADVANTAGEOUS TO SUCH
LENDER.  EACH LENDER SHALL DELIVER A WRITTEN STATEMENT OF SUCH LENDER TO THE
BORROWER (WITH A COPY TO THE ADMINISTRATIVE AGENT) AS TO THE AMOUNT DUE, IF ANY,
UNDER SECTION 3.1, 3.2, 3.4 OR 3.5.  SUCH WRITTEN STATEMENT SHALL SET FORTH IN
REASONABLE DETAIL THE CALCULATIONS AND ASSUMPTIONS UPON WHICH SUCH LENDER
DETERMINED SUCH AMOUNT AND SHALL BE FINAL, CONCLUSIVE AND BINDING ON THE
BORROWER IN THE ABSENCE OF MANIFEST ERROR.  DETERMINATION OF AMOUNTS PAYABLE
UNDER SUCH SECTIONS IN CONNECTION WITH A EURODOLLAR LOAN SHALL BE CALCULATED AS
THOUGH EACH LENDER FUNDED ITS EURODOLLAR LOAN THROUGH THE PURCHASE OF A DEPOSIT
OF THE TYPE AND MATURITY CORRESPONDING TO THE DEPOSIT USED AS A REFERENCE IN
DETERMINING THE EURODOLLAR RATE APPLICABLE TO SUCH LOAN, WHETHER IN FACT THAT IS
THE CASE OR NOT.  UNLESS OTHERWISE PROVIDED HEREIN, THE AMOUNT SPECIFIED IN THE
WRITTEN STATEMENT OF ANY LENDER SHALL BE PAYABLE ON DEMAND AFTER RECEIPT BY THE
BORROWER OF SUCH WRITTEN STATEMENT.  THE OBLIGATIONS OF THE BORROWER UNDER
SECTIONS 3.1, 3.2, 3.4 AND 3.5 SHALL SURVIVE PAYMENT OF THE OBLIGATIONS AND
TERMINATION OF THIS AGREEMENT.

 

ARTICLE IV

 

CONDITIONS PRECEDENT

 

4.1                                 INITIAL CREDIT EXTENSION.  THE LENDERS SHALL
NOT BE REQUIRED TO MAKE THE INITIAL CREDIT EXTENSION HEREUNDER UNLESS THE
BORROWER HAS FURNISHED TO THE ADMINISTRATIVE AGENT:

 

(A)                                  COPIES OF THE ARTICLES OR CERTIFICATE OF
INCORPORATION OF THE BORROWER AND EACH GUARANTOR, TOGETHER WITH ALL AMENDMENTS,
AND A CERTIFICATE OF GOOD STANDING, EACH CERTIFIED BY THE APPROPRIATE
GOVERNMENTAL OFFICER IN ITS RESPECTIVE JURISDICTION OF INCORPORATION, AS WELL AS
ANY OTHER INFORMATION REQUIRED BY SECTION 326 OF THE USA PATRIOT ACT OR
NECESSARY FOR THE ADMINISTRATIVE AGENT OR ANY LENDER TO VERIFY THE IDENTITY OF
THE BORROWER AS REQUIRED BY SECTION 326 OF THE USA PATRIOT ACT.

 

(B)                                 COPIES, CERTIFIED BY THE SECRETARY OR
ASSISTANT SECRETARY OF THE BORROWER AND EACH GUARANTOR, OF ITS BY-LAWS AND OF
ITS BOARD OF DIRECTORS’ RESOLUTIONS AND OF RESOLUTIONS OR ACTIONS OF ANY OTHER
BODY AUTHORIZING THE EXECUTION OF THE LOAN DOCUMENTS TO WHICH THE BORROWER AND
SUCH GUARANTOR IS A PARTY.

 

(C)                                  AN INCUMBENCY CERTIFICATE, EXECUTED BY THE
SECRETARY OR ASSISTANT SECRETARY OF THE BORROWER AND EACH GUARANTOR, WHICH SHALL
IDENTIFY BY NAME AND TITLE AND BEAR THE SIGNATURES OF THE AUTHORIZED OFFICERS
AND ANY OTHER OFFICERS OF THE BORROWER AND SUCH GUARANTOR AUTHORIZED TO SIGN THE
LOAN DOCUMENTS TO WHICH THE BORROWER AND SUCH GUARANTOR IS A PARTY, UPON WHICH
CERTIFICATE THE ADMINISTRATIVE AGENT AND THE LENDERS SHALL BE ENTITLED TO RELY
UNTIL INFORMED OF ANY CHANGE IN WRITING BY THE BORROWER.

 

(D)                                 A CERTIFICATE, SIGNED BY THE CHIEF FINANCIAL
OFFICER OF THE BORROWER, STATING THAT ON THE INITIAL CREDIT EXTENSION DATE (I)
THE REPRESENTATIONS AND WARRANTIES CONTAINED IN ARTICLE V ARE TRUE AND CORRECT
AS OF THE INITIAL CREDIT EXTENSION DATE AND (II) NO DEFAULT OR UNMATURED DEFAULT
HAS OCCURRED AND IS CONTINUING.

 

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(E)                                  (I) A WRITTEN LEGAL OPINION OF CLEARY,
GOTTLIEB, STEEN & HAMILTON, COUNSEL TO THE BORROWER AND ITS SUBSIDIARIES,
ADDRESSED TO THE ADMINISTRATIVE AGENT AND THE LENDERS IN FORM AND SUBSTANCE
REASONABLY ACCEPTABLE TO THE ADMINISTRATIVE AGENT, (II) A WRITTEN LEGAL OPINION
OF DAVID H. WEISER, GENERAL COUNSEL OF THE BORROWER AND ITS SUBSIDIARIES,
ADDRESSED TO THE ADMINISTRATIVE AGENT AND THE LENDERS IN FORM AND SUBSTANCE
REASONABLY ACCEPTABLE TO THE ADMINISTRATIVE AGENT AND (III) WRITTEN LEGAL
OPINIONS OF SUCH LOCAL COUNSEL REQUESTED BY THE ADMINISTRATIVE AGENT IN FORM AND
SUBSTANCE REASONABLY ACCEPTABLE TO THE ADMINISTRATIVE AGENT.

 

(F)                                    ANY NOTES REQUESTED BY A LENDER PURSUANT
TO SECTION 2.14 PAYABLE TO THE ORDER OF EACH SUCH REQUESTING LENDER.

 

(G)                                 WRITTEN MONEY TRANSFER INSTRUCTIONS, IN
SUBSTANTIALLY THE FORM OF EXHIBIT D, ADDRESSED TO THE ADMINISTRATIVE AGENT AND
SIGNED BY AN AUTHORIZED OFFICER, TOGETHER WITH SUCH OTHER RELATED MONEY TRANSFER
AUTHORIZATIONS AS THE ADMINISTRATIVE AGENT MAY HAVE REASONABLY REQUESTED.

 

(H)                                 THE GUARANTEE AND COLLATERAL AGREEMENT, DULY
EXECUTED BY EACH OF THE PARTIES THERETO TOGETHER WITH ALL CERTIFICATES
REPRESENTING PLEDGED STOCK AND RELATED STOCK POWERS EXECUTED IN BLANK.

 

(I)                                     A PROPERLY COMPLETED AND EXECUTED
FACILITY LC APPLICATION AS AND TO THE EXTENT REQUESTED BY EACH LC ISSUER.

 

(J)                                     A DULY COMPLETED BORROWING BASE
CERTIFICATE DATED AS OF THE CLOSING DATE.

 

(K)                                  WRITTEN CONFIRMATION FROM THE EXISTING
AGENT THAT UPON THE MAKING OF THE INITIAL CREDIT EXTENSION AND THE PAYMENT OF
THE REQUISITE AMOUNT TO THE EXISTING AGENT, ALL PRINCIPAL, INTEREST AND OTHER
AMOUNTS DUE UNDER THE EXISTING CREDIT AGREEMENT WILL BE PAID IN FULL, ALL
COMMITMENTS THEREUNDER WILL BE TERMINATED, ALL LIENS AND SECURITY INTERESTS
THEREUNDER WILL BE RELEASED AND TERMINATED (AND ALL COLLATERAL HELD BY THE
EXISTING AGENT OR LENDER THEREUNDER WILL BE DELIVERED TO THE BORROWER OR ITS
DESIGNEE), AND THE EXISTING CREDIT AGREEMENT AND ALL OTHER LOAN AND SECURITY
DOCUMENTS THEREUNDER WILL BE TERMINATED.

 

(L)                                     (A) SUCH DULY COMPLETED AND EXECUTED
UCC-1 FINANCING STATEMENTS AS THE ADMINISTRATIVE AGENT SHALL HAVE REQUESTED TO
PERFECT ITS LIEN IN THE COLLATERAL; (B) COPIES OF SEARCHES OF FINANCING
STATEMENTS FILED UNDER THE UNIFORM COMMERCIAL CODE WITH RESPECT TO THE ASSETS OF
THE BORROWER AND ITS SUBSIDIARIES IN SUCH JURISDICTIONS AS THE ADMINISTRATIVE
AGENT MAY REQUEST; AND (C) SUCH DULY EXECUTED UCC-3 TERMINATION STATEMENTS AND
SIMILAR DOCUMENTS AS THE ADMINISTRATIVE AGENT MAY REQUEST WITH RESPECT TO ANY
SECURITY INTERESTS SECURING THE OBLIGATIONS OF THE BORROWER AND ITS SUBSIDIARIES
UNDER THE EXISTING CREDIT AGREEMENT.

 

(M)                               SUCH OTHER DOCUMENTS AS ANY LENDER, THE LC
ISSUER OR ITS COUNSEL MAY HAVE REASONABLY REQUESTED.

 

4.2                                 EACH CREDIT EXTENSION.  THE LENDERS SHALL
NOT BE REQUIRED TO MAKE ANY CREDIT EXTENSION (EXCEPT AS OTHERWISE SET FORTH IN
SECTION 2.5.4 WITH RESPECT TO REVOLVING LOANS FOR THE PURPOSE OF REPAYING SWING
LINE LOANS) UNLESS ON THE APPLICABLE CREDIT EXTENSION DATE:

 

(A)                                  THERE EXISTS NO DEFAULT OR UNMATURED
DEFAULT.

 

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(B)                                 THE REPRESENTATIONS AND WARRANTIES CONTAINED
IN ARTICLE V ARE TRUE AND CORRECT IN ALL MATERIAL RESPECTS AS OF SUCH CREDIT
EXTENSION DATE EXCEPT TO THE EXTENT ANY SUCH REPRESENTATION OR WARRANTY IS
STATED TO RELATE SOLELY TO AN EARLIER DATE, IN WHICH CASE SUCH REPRESENTATION OR
WARRANTY SHALL HAVE BEEN TRUE AND CORRECT IN ALL MATERIAL RESPECTS ON AND AS OF
SUCH EARLIER DATE.

 

Each Borrowing Notice, Swing Line Borrowing Notice, or request for issuance of a
Facility LC, as the case may be, with respect to each such Credit Extension
shall constitute a representation and warranty by the Borrower that the
conditions contained in Sections 4.2(a) and (b) have been satisfied.

 

ARTICLE V

 

REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants to the Lenders that:

 

5.1                                 Financial Condition.  The audited
consolidated balance sheets of the Borrower and its consolidated Subsidiaries as
at December 28, 2002 and December 29, 2001, and the related consolidated
statements of income and of cash flows for the fiscal years ended on such dates,
reported on by and accompanied by an unqualified report from Deloitte & Touche
LLP present fairly the consolidated financial condition of the Borrower and its
consolidated Subsidiaries as at such date, and the consolidated results of its
operations and its consolidated cash flows for the respective fiscal years then
ended.  The unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at October 4, 2003, and the related unaudited
consolidated statements of income and cash flows for the nine-month period ended
on such date, present fairly the consolidated financial condition of the
Borrower and its consolidated Subsidiaries as at such date, and the consolidated
results of its operations and its consolidated cash flows for the nine-month
period then ended (subject to normal year-end audit adjustments).  All such
financial statements, including the related schedules and notes thereto, have
been prepared in accordance with GAAP applied consistently throughout the
periods involved (except as approved by the aforementioned firm of accountants
and disclosed therein).  The Borrower and its consolidated Subsidiaries do not
have any material Guarantee Obligations, contingent liabilities and liabilities
for taxes, or any long-term leases or unusual forward or long-term commitments,
including any interest rate or foreign currency swap or exchange transaction or
other obligation in respect of derivatives, that are not reflected in the most
recent financial statements referred to in this paragraph.

 

5.2                                 NO CHANGE.  SINCE DECEMBER 28, 2002, THERE
HAS BEEN NO DEVELOPMENT OR EVENT THAT HAS HAD OR COULD REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT.

 

5.3                                 CORPORATE EXISTENCE; COMPLIANCE WITH LAW. 
EACH OF THE BORROWER AND ITS SUBSIDIARIES (A) IS DULY ORGANIZED, VALIDLY
EXISTING AND IN GOOD STANDING UNDER THE LAWS OF THE JURISDICTION OF ITS
ORGANIZATION, (B) HAS THE CORPORATE POWER AND AUTHORITY, AND THE LEGAL RIGHT, TO
OWN AND OPERATE ITS PROPERTY, TO LEASE THE PROPERTY IT OPERATES AS LESSEE AND TO
CONDUCT THE BUSINESS IN WHICH IT IS CURRENTLY ENGAGED, (C) IS DULY QUALIFIED AS
A FOREIGN CORPORATION AND IN GOOD STANDING UNDER THE LAWS OF EACH JURISDICTION
WHERE ITS OWNERSHIP, LEASE OR OPERATION OF PROPERTY OR THE CONDUCT OF ITS
BUSINESS REQUIRES SUCH QUALIFICATION AND (D) IS IN COMPLIANCE WITH ALL
REQUIREMENTS OF LAW EXCEPT TO THE EXTENT THAT THE FAILURE TO COMPLY THEREWITH
COULD NOT, IN THE AGGREGATE, REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE
EFFECT.

 

5.4                                 CORPORATE POWER.  EACH LOAN PARTY HAS THE
CORPORATE POWER AND AUTHORITY, AND THE LEGAL RIGHT, TO MAKE, DELIVER AND PERFORM
THE LOAN DOCUMENTS TO WHICH IT IS A PARTY AND, IN THE CASE OF THE BORROWER, TO
BORROW HEREUNDER, AND TO HAVE FACILITY LCS ISSUED FOR ITS ACCOUNT HEREUNDER. 
EACH LOAN

 

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PARTY HAS TAKEN ALL NECESSARY CORPORATE ACTION TO AUTHORIZE THE EXECUTION,
DELIVERY AND PERFORMANCE OF THE LOAN DOCUMENTS TO WHICH IT IS A PARTY AND, IN
THE CASE OF THE BORROWER, TO AUTHORIZE THE BORROWINGS ON THE TERMS AND
CONDITIONS OF THIS AGREEMENT, THE ISSUANCE OF FACILITY LCS FOR ITS ACCOUNT
HEREUNDER.  NO CONSENT OR AUTHORIZATION OF, FILING WITH, NOTICE TO OR OTHER ACT
BY OR IN RESPECT OF, ANY GOVERNMENTAL AUTHORITY OR ANY OTHER PERSON IS REQUIRED
IN CONNECTION WITH THE BORROWINGS HEREUNDER OR WITH THE EXECUTION, DELIVERY,
PERFORMANCE, VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY OF THE LOAN
DOCUMENTS, EXCEPT (I) CONSENTS, AUTHORIZATIONS, FILINGS AND NOTICES DESCRIBED IN
SCHEDULE 5.4, WHICH CONSENTS, AUTHORIZATIONS, FILINGS AND NOTICES HAVE BEEN
OBTAINED OR MADE AND ARE IN FULL FORCE AND EFFECT AND (II) THE FILINGS REFERRED
TO IN SECTION 5.19.  EACH LOAN DOCUMENT HAS BEEN DULY EXECUTED AND DELIVERED ON
BEHALF OF EACH LOAN PARTY PARTY THERETO.  THIS AGREEMENT CONSTITUTES, AND EACH
OTHER LOAN DOCUMENT UPON EXECUTION WILL CONSTITUTE, A LEGAL, VALID AND BINDING
OBLIGATION OF EACH LOAN PARTY PARTY THERETO, ENFORCEABLE AGAINST EACH SUCH LOAN
PARTY IN ACCORDANCE WITH ITS TERMS, EXCEPT AS ENFORCEABILITY MAY BE LIMITED BY
APPLICABLE BANKRUPTCY, INSOLVENCY, REORGANIZATION, MORATORIUM OR SIMILAR LAWS
AFFECTING THE ENFORCEMENT OF CREDITORS’ RIGHTS GENERALLY AND BY GENERAL
EQUITABLE PRINCIPLES (WHETHER ENFORCEMENT IS SOUGHT BY PROCEEDINGS IN EQUITY OR
AT LAW).

 

5.5                                 NO LEGAL BAR.  THE EXECUTION, DELIVERY AND
PERFORMANCE OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, THE ISSUANCE OF
FACILITY LCS, THE CREDIT EXTENSIONS HEREUNDER AND THE USE OF THE PROCEEDS
THEREOF WILL NOT VIOLATE ANY REQUIREMENT OF LAW OR ANY CONTRACTUAL OBLIGATION OF
THE BORROWER OR ANY OF ITS SUBSIDIARIES AND WILL NOT RESULT IN, OR REQUIRE, THE
CREATION OR IMPOSITION OF ANY LIEN ON ANY OF THEIR RESPECTIVE PROPERTIES OR
REVENUES PURSUANT TO ANY REQUIREMENT OF LAW OR ANY SUCH CONTRACTUAL OBLIGATION
(OTHER THAN THE LIENS CREATED BY THE COLLATERAL DOCUMENTS).

 

5.6                                 LITIGATION.  EXCEPT AS SET FORTH IN
SCHEDULE 5.9, NO LITIGATION, INVESTIGATION OR PROCEEDING OF OR BEFORE ANY
ARBITRATOR OR GOVERNMENTAL AUTHORITY IS PENDING OR, TO THE KNOWLEDGE OF THE
BORROWER, THREATENED BY OR AGAINST THE BORROWER OR ANY OF ITS SUBSIDIARIES OR
AGAINST ANY OF THEIR RESPECTIVE PROPERTIES OR REVENUES (A) WITH RESPECT TO ANY
OF THE LOAN DOCUMENTS, THE CREDIT EXTENSIONS HEREUNDER AND THE USE OF THE
PROCEEDS THEREOF, OF ANY DRAWINGS UNDER A FACILITY LC OR OF THE CREATION AND
DISCOUNTING OF ANY ACCEPTANCE, OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, OR (B) THAT COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE
EFFECT.

 

5.7                                 NO DEFAULT.  NEITHER THE BORROWER NOR ANY OF
ITS SUBSIDIARIES IS IN DEFAULT UNDER OR WITH RESPECT TO ANY OF ITS CONTRACTUAL
OBLIGATIONS IN ANY RESPECT THAT COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT.  NO DEFAULT OR UNMATURED DEFAULT HAS OCCURRED AND IS CONTINUING.

 

5.8                                 OWNERSHIP OF PROPERTY; LIENS.  EACH OF THE
BORROWER AND EACH OF ITS SUBSIDIARIES HAS TITLE IN FEE SIMPLE TO, OR A VALID
LEASEHOLD INTEREST IN, ALL ITS REAL PROPERTY, AND GOOD TITLE TO, OR A VALID
LEASEHOLD INTEREST IN, ALL ITS OTHER PROPERTY, AND NONE OF SUCH PROPERTY IS
SUBJECT TO ANY MATERIAL LIEN EXCEPT AS PERMITTED BY SECTION 7.3.

 

5.9                                 INTELLECTUAL PROPERTY.  EXCEPT AS SET FORTH
IN SCHEDULE 5.9 HERETO, (A) EACH OF THE BORROWER AND EACH OF ITS SUBSIDIARIES
OWNS, OR IS LICENSED TO USE, ALL INTELLECTUAL PROPERTY NECESSARY FOR THE CONDUCT
OF ITS BUSINESS AS CURRENTLY CONDUCTED; (B) NO MATERIAL CLAIM THAT COULD
REASONABLY BE EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT HAS BEEN ASSERTED
AND IS PENDING BY ANY PERSON CHALLENGING OR QUESTIONING THE USE OF ANY
INTELLECTUAL PROPERTY OR THE VALIDITY OR EFFECTIVENESS OF ANY INTELLECTUAL
PROPERTY, NOR DOES THE BORROWER KNOW OF ANY VALID BASIS FOR ANY SUCH CLAIM; AND
(C) THE USE OF INTELLECTUAL PROPERTY BY THE BORROWER AND ITS SUBSIDIARIES DOES
NOT INFRINGE ON THE RIGHTS OF ANY PERSON IN ANY MATERIAL RESPECT.

 

5.10                           TAXES.  EACH OF THE BORROWER AND EACH OF ITS
SUBSIDIARIES HAS FILED OR CAUSED TO BE FILED ALL FEDERAL, STATE (OTHER THAN
IMMATERIAL SALES TAX RETURNS) AND OTHER MATERIAL TAX RETURNS THAT ARE REQUIRED
TO BE FILED AND HAS PAID ALL TAXES SHOWN TO BE DUE AND PAYABLE ON SAID RETURNS
OR ON ANY ASSESSMENTS MADE

 

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AGAINST IT OR ANY OF ITS PROPERTY AND ALL OTHER MATERIAL TAXES, FEES OR OTHER
CHARGES IMPOSED ON IT OR ANY OF ITS PROPERTY BY ANY GOVERNMENTAL AUTHORITY
(OTHER THAN ANY THE AMOUNT OR VALIDITY OF WHICH ARE CURRENTLY BEING CONTESTED IN
GOOD FAITH BY APPROPRIATE PROCEEDINGS AND WITH RESPECT TO WHICH RESERVES IN
CONFORMITY WITH GAAP HAVE BEEN PROVIDED ON THE BOOKS OF THE BORROWER OR A
SUBSIDIARY, AS THE CASE MAY BE); NO TAX LIEN HAS BEEN FILED, AND, TO THE
KNOWLEDGE OF THE BORROWER, NO CLAIM IS BEING ASSERTED, WITH RESPECT TO ANY SUCH
TAX, FEE OR OTHER CHARGE, EXCEPT FOR LIENS SECURING IMMATERIAL AMOUNTS AFFECTING
ASSETS OTHER THAN ANY COLLATERAL.

 

5.11                           FEDERAL REGULATIONS.  NEITHER THE BORROWER NOR
ANY OF ITS SUBSIDIARIES IS ENGAGED, DIRECTLY OR INDIRECTLY, PRINCIPALLY, OR AS
ONE OF ITS IMPORTANT ACTIVITIES, IN THE BUSINESS OF EXTENDING, OR ARRANGING FOR
THE EXTENSION OF, CREDIT FOR THE PURPOSE OF PURCHASING OR CARRYING “MARGIN
STOCK” WITHIN THE MEANING OF REGULATION U OR X.  NO PART OF THE PROCEEDS OF ANY
CREDIT EXTENSION WILL BE USED IN ANY WAY THAT WOULD VIOLATE THE PROVISIONS OF
REGULATION T, U OR X AS NOW AND FROM TIME TO TIME HEREAFTER IN EFFECT OR FOR ANY
PURPOSE THAT VIOLATES THE PROVISIONS OF THE REGULATIONS OF THE BOARD.  IF
REQUESTED BY ANY LENDER OR THE ADMINISTRATIVE AGENT, THE BORROWER WILL FURNISH
TO THE ADMINISTRATIVE AGENT AND EACH LENDER A STATEMENT TO THE FOREGOING EFFECT
IN CONFORMITY WITH THE REQUIREMENTS OF FR FORM G-3 OR FR FORM U-1, AS
APPLICABLE, REFERRED TO IN REGULATION U.  FOLLOWING THE APPLICATION OF THE
PROCEEDS OF ANY CREDIT EXTENSION, LESS THAN 25% OF THE VALUE (AS DETERMINED BY
ANY REASONABLE METHOD) OF THE ASSETS OF THE BORROWER AND ITS SUBSIDIARIES TAKEN
AS A WHOLE HAVE BEEN, AND WILL CONTINUE TO BE, REPRESENTED BY “MARGIN STOCK”.

 

5.12                           LABOR MATTERS.  EXCEPT AS, IN THE AGGREGATE,
COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT:  (A) THERE
ARE NO STRIKES OR OTHER LABOR DISPUTES AGAINST THE BORROWER OR ANY OF ITS
SUBSIDIARIES PENDING OR, TO THE KNOWLEDGE OF THE BORROWER, THREATENED WHICH
COULD REASONABLY BE EXPECTED TO HAVE AN MATERIAL ADVERSE EFFECT; (B) THE HOURS
WORKED BY AND PAYMENT MADE TO EMPLOYEES OF THE BORROWER AND ITS SUBSIDIARIES
HAVE NOT BEEN IN MATERIAL VIOLATION OF THE FAIR LABOR STANDARDS ACT OR ANY OTHER
APPLICABLE REQUIREMENT OF LAW DEALING WITH SUCH MATTERS; AND (C) ALL MATERIAL
PAYMENTS DUE FROM THE BORROWER OR ANY OF ITS SUBSIDIARIES ON ACCOUNT OF EMPLOYEE
HEALTH AND WELFARE INSURANCE HAVE BEEN PAID OR ACCRUED AS A LIABILITY ON THE
BOOKS OF THE BORROWER OR THE RELEVANT SUBSIDIARY.

 

5.13                           ERISA.  NEITHER A REPORTABLE EVENT NOR AN
“ACCUMULATED FUNDING DEFICIENCY” (WITHIN THE MEANING OF SECTION 412 OF THE CODE
OR SECTION 302 OF ERISA) HAS OCCURRED DURING THE FIVE-YEAR PERIOD PRIOR TO THE
DATE ON WHICH THIS REPRESENTATION IS MADE OR DEEMED MADE WITH RESPECT TO ANY
SINGLE EMPLOYER PLAN, AND EACH SINGLE EMPLOYER PLAN AND, TO THE KNOWLEDGE OF THE
BORROWER, ANY MULTIEMPLOYER PLAN, HAS COMPLIED IN ALL MATERIAL RESPECTS WITH THE
APPLICABLE PROVISIONS OF ERISA AND THE CODE.  NEITHER THE BORROWER NOR ANY
COMMONLY CONTROLLED ENTITY HAS FAILED TO MAKE A REQUIRED CONTRIBUTION TO A
MULTIEMPLOYER PLAN DURING THE FIVE YEAR PERIOD PRIOR TO THE DATE ON WHICH THIS
REPRESENTATION IS MADE OR DEEMED MADE.  NO TERMINATION, OTHER THAN A STANDARD
TERMINATION (WITHIN THE MEANING OF SECTION 4041 OF ERISA) AS TO WHICH THERE IS
NO LIABILITY TO THE BORROWER OR ANY COMMONLY CONTROLLED ENTITY, OF A SINGLE
EMPLOYER PLAN HAS OCCURRED, AND NO LIEN IN FAVOR OF THE PBGC OR A SINGLE
EMPLOYER PLAN HAS ARISEN, DURING SUCH FIVE-YEAR PERIOD.  THE PRESENT VALUE OF
ALL ACCRUED BENEFITS UNDER EACH SINGLE EMPLOYER PLAN (BASED ON ASSUMPTIONS USED
TO FUND SUCH PLAN) DID NOT, AS OF THE LAST ANNUAL VALUATION DATE PRIOR TO THE
DATE ON WHICH THIS REPRESENTATION IS MADE OR DEEMED MADE, EXCEED THE FAIR MARKET
VALUE OF THE ASSETS OF SUCH PLAN ALLOCABLE TO SUCH ACCRUED BENEFITS BY A
MATERIAL AMOUNT.  NEITHER THE BORROWER NOR ANY COMMONLY CONTROLLED ENTITY HAS
HAD A COMPLETE OR PARTIAL WITHDRAWAL FROM ANY MULTIEMPLOYER PLAN THAT HAS
RESULTED OR COULD REASONABLY BE EXPECTED TO RESULT IN A MATERIAL LIABILITY UNDER
ERISA, AND NEITHER THE BORROWER NOR ANY COMMONLY CONTROLLED ENTITY WOULD BECOME
SUBJECT TO ANY MATERIAL LIABILITY UNDER ERISA IF THE BORROWER OR ANY SUCH
COMMONLY CONTROLLED ENTITY WERE TO WITHDRAW COMPLETELY FROM ALL MULTIEMPLOYER
PLANS AS OF THE VALUATION DATE MOST CLOSELY PRECEDING THE DATE ON WHICH THIS
REPRESENTATION IS MADE OR DEEMED MADE.  NO SUCH MULTIEMPLOYER PLAN IS IN

 

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REORGANIZATION OR INSOLVENT AS A RESULT OF WHICH THE BORROWER OR ANY COMMONLY
CONTROLLED ENTITY HAS INCURRED OR COULD REASONABLY BE EXPECTED TO INCUR A
MATERIAL LIABILITY.

 

5.14                           INVESTMENT COMPANY ACT; OTHER REGULATIONS.  NO
LOAN PARTY IS AN “INVESTMENT COMPANY”, OR A COMPANY “CONTROLLED” BY AN
“INVESTMENT COMPANY”, WITHIN THE MEANING OF THE INVESTMENT COMPANY ACT OF 1940,
AS AMENDED.  NO LOAN PARTY IS SUBJECT TO REGULATION UNDER ANY REQUIREMENT OF LAW
(OTHER THAN REGULATION X OF THE BOARD) THAT LIMITS ITS ABILITY TO INCUR
INDEBTEDNESS.

 

5.15                           SUBSIDIARIES.  EXCEPT AS DISCLOSED TO THE
ADMINISTRATIVE AGENT BY THE BORROWER IN WRITING FROM TIME TO TIME AFTER THE
CLOSING DATE, (A) SCHEDULE 5.15 SETS FORTH THE NAME AND JURISDICTION OF
INCORPORATION OF EACH SUBSIDIARY AND, AS TO EACH SUCH SUBSIDIARY, THE PERCENTAGE
OF EACH CLASS OF CAPITAL STOCK OWNED BY ANY LOAN PARTY AND (B) THERE ARE NO
OUTSTANDING SUBSCRIPTIONS, OPTIONS, WARRANTS, CALLS, RIGHTS OR OTHER AGREEMENTS
OR COMMITMENTS (OTHER THAN STOCK OPTIONS GRANTED TO EMPLOYEES OR DIRECTORS AND
DIRECTORS’ QUALIFYING SHARES) OF ANY NATURE RELATING TO ANY CAPITAL STOCK OF THE
BORROWER OR ANY SUBSIDIARY, EXCEPT AS CREATED BY THE LOAN DOCUMENTS.

 

5.16                           USE OF PROCEEDS.  (A)  THE PROCEEDS OF THE
ADVANCES MAY ONLY BE USED FOR GENERAL CORPORATE AND WORKING CAPITAL PURPOSES
INCLUDING, WITHOUT LIMITATION, TO FINANCE PERMITTED ACQUISITIONS, SHARE
REPURCHASES AND DIVIDENDS AND DISTRIBUTIONS WITH RESPECT TO THE BORROWER’S
CAPITAL STOCK AND TO REFINANCE THE OUTSTANDING OBLIGATIONS UNDER THE EXISTING
CREDIT AGREEMENT, (B) THE COMMERCIAL FACILITY LCS SHALL BE ISSUED, AND DRAWN
UPON, IN CONNECTION WITH THE IMPORTATION OR EXPORTATION BY THE BORROWER OF GOODS
IN THE ORDINARY COURSE OF BUSINESS, AND (C) THE STANDBY FACILITY LCS SHALL BE
ISSUED, AND DRAWN UPON, IN RESPECT OF OBLIGATIONS OF THE BORROWER OR ANY OF ITS
SUBSIDIARIES INCURRED PURSUANT TO CONTRACTS MADE OR PERFORMANCES UNDERTAKEN OR
TO BE UNDERTAKEN OR LIKE MATTERS RELATING TO CONTRACTS TO WHICH THE BORROWER OR
SUCH SUBSIDIARY IS OR PROPOSES TO BECOME A PARTY IN THE ORDINARY COURSE OF THE
BORROWER’S OR SUCH SUBSIDIARY’S BUSINESS, INCLUDING, WITHOUT LIMITING THE
FOREGOING, FOR INSURANCE PURPOSES OR IN RESPECT OF ADVANCE PAYMENTS OR AS BID OR
PERFORMANCE BONDS.

 

5.17                           ENVIRONMENTAL MATTERS.  EXCEPT AS, IN THE
AGGREGATE, COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT:

 

(A)                                  TO THE KNOWLEDGE OF THE BORROWER AFTER DUE
INQUIRY (BUT SUBJECT TO THE QUALIFICATION SET FORTH BELOW) THE FACILITIES AND
PROPERTY OWNED, LEASED OR OPERATED BY THE BORROWER OR ANY OF ITS SUBSIDIARIES DO
NOT CONTAIN, AND HAVE NOT PREVIOUSLY CONTAINED, ANY MATERIALS OF ENVIRONMENTAL
CONCERN IN AMOUNTS OR CONCENTRATIONS OR UNDER CIRCUMSTANCES THAT CONSTITUTE OR
CONSTITUTED A VIOLATION OF, OR COULD GIVE RISE TO LIABILITY UNDER, ANY
APPLICABLE ENVIRONMENTAL LAW;

 

(B)                                 NEITHER THE BORROWER NOR ANY OF ITS
SUBSIDIARIES HAS RECEIVED OR IS AWARE OF ANY NOTICE OF VIOLATION, ALLEGED
VIOLATION, NON-COMPLIANCE, LIABILITY OR POTENTIAL LIABILITY REGARDING
ENVIRONMENTAL MATTERS OR COMPLIANCE WITH APPLICABLE ENVIRONMENTAL LAWS WITH
REGARD TO ANY OF THE PROPERTY OWNED, LEASED OR OPERATED BY, OR THE BUSINESS
OPERATED BY, THE BORROWER OR ANY OF ITS SUBSIDIARIES (THE “BUSINESS”), NOR DOES
THE BORROWER HAVE KNOWLEDGE OR REASON TO BELIEVE THAT ANY SUCH NOTICE WILL BE
RECEIVED OR IS BEING THREATENED;

 

(C)                                  TO THE KNOWLEDGE OF THE BORROWER AFTER DUE
INQUIRY (BUT SUBJECT TO THE QUALIFICATION SET FORTH BELOW) MATERIALS OF
ENVIRONMENTAL CONCERN HAVE NOT BEEN TRANSPORTED OR DISPOSED OF FROM ANY PROPERTY
OWNED, LEASED OR OPERATED BY THE BORROWER OR ANY OF ITS SUBSIDIARIES IN
VIOLATION OF, OR IN A MANNER OR TO A LOCATION THAT COULD GIVE RISE TO LIABILITY
UNDER, ANY APPLICABLE ENVIRONMENTAL LAW, NOR HAVE ANY MATERIALS OF ENVIRONMENTAL
CONCERN BEEN GENERATED, TREATED, STORED OR DISPOSED OF AT, ON OR UNDER ANY OF
THE PROPERTY OWNED, LEASED OR

 

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OPERATED BY THE BORROWER OR ANY OF ITS SUBSIDIARIES IN VIOLATION OF, OR IN A
MANNER THAT COULD GIVE RISE TO LIABILITY UNDER, ANY APPLICABLE ENVIRONMENTAL
LAW;

 

(D)                                 NO JUDICIAL PROCEEDING OR GOVERNMENTAL OR
ADMINISTRATIVE ACTION IS PENDING OR, TO THE KNOWLEDGE OF THE BORROWER,
THREATENED, UNDER ANY APPLICABLE ENVIRONMENTAL LAW TO WHICH THE BORROWER OR ANY
SUBSIDIARY IS OR WILL BE NAMED AS A PARTY WITH RESPECT TO ANY PROPERTY OWNED,
LEASED OR OPERATED BY THE BORROWER OR ANY OF ITS SUBSIDIARIES OR THE BUSINESS,
NOR ARE THERE ANY CONSENT DECREES OR OTHER DECREES, CONSENT ORDERS,
ADMINISTRATIVE ORDERS OR OTHER ORDERS, OR OTHER ADMINISTRATIVE OR JUDICIAL
REQUIREMENTS OUTSTANDING UNDER ANY APPLICABLE ENVIRONMENTAL LAW WITH RESPECT TO
ANY PROPERTY OWNED, LEASED OR OPERATED BY THE BORROWER OR ANY OF ITS
SUBSIDIARIES OR THE BUSINESS;

 

(E)                                  THERE HAS BEEN NO RELEASE OR THREAT OF
RELEASE OF MATERIALS OF ENVIRONMENTAL CONCERN AT OR FROM ANY PROPERTY OWNED,
LEASED OR OPERATED BY THE BORROWER OR ANY OF ITS SUBSIDIARIES, OR ARISING FROM
OR RELATED TO THE OPERATIONS OF THE BORROWER OR ANY SUBSIDIARY IN CONNECTION
WITH ANY PROPERTY OWNED, LEASED OR OPERATED BY THE BORROWER OR ANY OF ITS
SUBSIDIARIES OR OTHERWISE IN CONNECTION WITH THE BUSINESS, IN VIOLATION OF OR IN
AMOUNTS OR IN A MANNER THAT COULD GIVE RISE TO LIABILITY UNDER ENVIRONMENTAL
LAWS;

 

(F)                                    ALL PROPERTY OWNED, LEASED OR OPERATED BY
THE BORROWER OR ANY OF ITS SUBSIDIARIES  AND ALL OPERATIONS AT SUCH PROPERTY ARE
IN COMPLIANCE, AND TO THE KNOWLEDGE OF THE BORROWER AFTER DUE INQUIRY (BUT
SUBJECT TO THE QUALIFICATION SET FORTH BELOW) HAVE IN THE LAST FIVE YEARS BEEN
IN COMPLIANCE, WITH ALL APPLICABLE ENVIRONMENTAL LAWS, AND TO THE KNOWLEDGE OF
THE BORROWER AFTER DUE INQUIRY (BUT SUBJECT TO THE QUALIFICATION SET FORTH
BELOW) THERE IS NO CONTAMINATION AT, UNDER OR ABOUT SUCH PROPERTY OR VIOLATION
OF ANY APPLICABLE ENVIRONMENTAL LAW WITH RESPECT TO SUCH PROPERTY OR THE
BUSINESS; AND

 

(G)                                 NEITHER THE BORROWER NOR ANY OF ITS
SUBSIDIARIES HAS ASSUMED ANY LIABILITY OF ANY OTHER PERSON UNDER ENVIRONMENTAL
LAWS.

 

Notwithstanding the qualifications of the foregoing representations as to the
Borrower’s knowledge in clauses (a), (c) and (f) above, in the event that a
condition exists that would have resulted in a Default pursuant to Section 8(b)
but for such qualification, such Default shall be deemed to have occurred
notwithstanding such qualification.

 

5.18                           ACCURACY OF INFORMATION.  THE STATEMENTS AND
INFORMATION CONTAINED IN THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, THE
CONFIDENTIAL INFORMATION MEMORANDUM (EXCEPT, IN THE CASE OF CERTAIN FINANCIAL
INFORMATION CONTAINED THEREIN, TO THE EXTENT SUPERSEDED BY SUBSEQUENT
INFORMATION DELIVERED TO THE LENDERS PRIOR TO THE CLOSING DATE) AND ANY OTHER
DOCUMENT, CERTIFICATE OR STATEMENT FURNISHED BY OR ON BEHALF OF ANY LOAN PARTY
TO THE ADMINISTRATIVE AGENT OR THE LENDERS, OR ANY OF THEM, FOR USE IN
CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR THE OTHER
LOAN DOCUMENTS, AS OF THE DATE SUCH STATEMENTS AND INFORMATION WERE OR ARE SO
FURNISHED (OR, IN THE CASE OF THE CONFIDENTIAL INFORMATION MEMORANDUM, AS OF THE
DATE OF THIS AGREEMENT), WERE OR ARE TRUE AND CORRECT IN ALL MATERIAL RESPECTS. 
ANY PROJECTIONS AND PRO FORMA FINANCIAL INFORMATION CONTAINED IN THE MATERIALS
REFERENCED ABOVE ARE BASED UPON GOOD FAITH ESTIMATES AND ASSUMPTIONS BELIEVED BY
MANAGEMENT OF THE BORROWER TO BE REASONABLE AT THE TIME MADE, IT BEING
RECOGNIZED BY THE LENDERS THAT SUCH FINANCIAL INFORMATION AS IT RELATES TO
FUTURE EVENTS IS NOT TO BE VIEWED AS FACT AND THAT ACTUAL RESULTS DURING THE
PERIOD OR PERIODS COVERED BY SUCH FINANCIAL INFORMATION MAY DIFFER FROM THE
PROJECTED RESULTS SET FORTH THEREIN BY A MATERIAL AMOUNT.  THERE IS NO FACT
KNOWN TO ANY LOAN PARTY THAT COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT THAT HAS NOT BEEN EXPRESSLY DISCLOSED HEREIN, IN THE OTHER LOAN
DOCUMENTS, IN THE CONFIDENTIAL INFORMATION MEMORANDUM OR IN ANY OTHER DOCUMENTS,
CERTIFICATES AND STATEMENTS FURNISHED

 

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TO THE ADMINISTRATIVE AGENT AND THE LENDERS FOR USE IN CONNECTION WITH THE
TRANSACTIONS CONTEMPLATED HEREBY AND BY THE OTHER LOAN DOCUMENTS.

 

5.19                           COLLATERAL DOCUMENTS.  (A)  THE GUARANTEE AND
COLLATERAL AGREEMENT IS EFFECTIVE TO CREATE IN FAVOR OF THE ADMINISTRATIVE
AGENT, FOR THE BENEFIT OF THE LENDERS, A LEGAL, VALID AND ENFORCEABLE SECURITY
INTEREST IN THE COLLATERAL DESCRIBED THEREIN AND PROCEEDS THEREOF.  IN THE CASE
OF PLEDGED STOCK THAT CONSTITUTES CERTIFICATED SECURITIES (AS DEFINED IN THE
UNIFORM COMMERCIAL CODE), WHEN STOCK CERTIFICATES REPRESENTING SUCH PLEDGED
STOCK ARE DELIVERED TO THE ADMINISTRATIVE AGENT TOGETHER WITH UNDATED STOCK
POWERS COVERING SUCH CERTIFICATES EXECUTED IN BLANK, THE GRANTORS THEREUNDER
SHALL HAVE GRANTED TO THE ADMINISTRATIVE AGENT A FULLY PERFECTED LIEN ON, AND
SECURITY INTEREST IN, ALL RIGHT, TITLE AND INTEREST OF THE LOAN PARTIES IN SUCH
COLLATERAL AND THE PROCEEDS THEREOF, AS SECURITY FOR THE SECURED OBLIGATIONS, IN
EACH CASE PRIOR AND SUPERIOR IN RIGHT TO ANY OTHER PERSON (EXCEPT LIENS
PERMITTED BY SECTIONS 7.3(A) AND (G), AND SUBJECT, IN THE CASE OF PROCEEDS, TO
THE APPLICABLE LIMITATIONS UNDER SECTION 9-315 OF THE UNIFORM COMMERCIAL CODE). 
IN THE CASE OF PLEDGED STOCK THAT CONSTITUTES GENERAL INTANGIBLES OR
UNCERTIFICATED SECURITIES (AS DEFINED IN THE UNIFORM COMMERCIAL CODE), WHEN
FINANCING STATEMENTS SPECIFIED ON SCHEDULE 5.19(A) IN APPROPRIATE FORM ARE FILED
IN THE OFFICES SPECIFIED ON SCHEDULE 5.19(A) AND, IN THE CASE OF UNCERTIFICATED
SECURITIES, THE ADMINISTRATIVE AGENT HAS OBTAINED “CONTROL” (WITHIN THE MEANING
OF THE UNIFORM COMMERCIAL CODE) OF SUCH UNCERTIFICATED SECURITIES, THE GRANTORS
THEREUNDER SHALL HAVE GRANTED TO THE ADMINISTRATIVE AGENT A FULLY PERFECTED LIEN
ON, AND SECURITY INTEREST IN, ALL RIGHT, TITLE AND INTEREST OF THE LOAN PARTIES
IN SUCH COLLATERAL AND THE PROCEEDS THEREOF, AS SECURITY FOR THE SECURED
OBLIGATIONS, IN EACH CASE PRIOR AND SUPERIOR IN RIGHT TO ANY OTHER PERSON
(EXCEPT LIENS PERMITTED BY SECTIONS 7.3(A) AND (G), AND SUBJECT, IN THE CASE OF
PROCEEDS TO THE APPLICABLE LIMITATIONS UNDER SECTION 9-315 OF THE UNIFORM
COMMERCIAL CODE).  SCHEDULE 5.19(A) SPECIFIES THE LOCATIONS IN WHICH TO FILE THE
FINANCING STATEMENTS WHICH MAY PERFECT A LEGAL, VALID AND ENFORCEABLE SECURITY
INTEREST GRANTED UNDER THE GUARANTEE AND COLLATERAL AGREEMENT IN THE INVESTMENT
PROPERTY (AS DEFINED IN THE GUARANTEE AND COLLATERAL AGREEMENT) PURSUANT TO
SECTION 9-305(C) OF THE UNIFORM COMMERCIAL CODE.

 

5.20                           SOLVENCY.  EACH LOAN PARTY IS, AND AFTER GIVING
EFFECT TO THE INCURRENCE OF ALL INDEBTEDNESS AND OBLIGATIONS BEING INCURRED IN
CONNECTION HEREWITH WILL BE AND WILL CONTINUE TO BE, SOLVENT.

 

5.21                           REPORTABLE TRANSACTION. THE BORROWER DOES NOT
INTEND TO TREAT THE CREDIT EXTENSIONS AND RELATED TRANSACTIONS AS BEING A
“REPORTABLE TRANSACTION” (WITHIN THE MEANING OF TREASURY REGULATION
SECTION 1.6011-4).  IN THE EVENT THE BORROWER DETERMINES TO TAKE ANY ACTION
INCONSISTENT WITH SUCH INTENTION, IT WILL PROMPTLY NOTIFY THE ADMINISTRATIVE
AGENT THEREOF.  THE BORROWER ACKNOWLEDGES THAT ONE OR MORE OF THE LENDERS MAY
TREAT ITS CREDIT EXTENSIONS AS PART OF A TRANSACTION THAT IS SUBJECT TO TREASURY
REGULATION SECTION 1.6011-4 OR SECTION 301.6112-1, AND THE ADMINISTRATIVE AGENT
AND SUCH LENDER OR LENDERS, AS APPLICABLE, MAY FILE SUCH IRS FORMS OR MAINTAIN
SUCH LISTS AND OTHER RECORDS AS THEY MAY DETERMINE IS REQUIRED BY SUCH TREASURY
REGULATIONS.

 

ARTICLE VI

 

COVENANTS

 

Until all of the Obligations have been indefeasibly paid in full and the
Aggregate Commitment has been terminated, unless the Required Lenders shall
otherwise consent in writing, the Borrower shall, and shall cause each of its
Subsidiaries to:

 

6.1                                 FINANCIAL STATEMENTS.  FURNISH TO THE
ADMINISTRATIVE AGENT AND EACH LENDER:

 

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(A)                                  AS SOON AS AVAILABLE, BUT IN ANY EVENT NOT
LATER THAN THE EARLIER OF (A) 90 DAYS AFTER THE END OF EACH FISCAL YEAR OF THE
BORROWER AND (B) THE PUBLIC FILING WITH THE SEC OF THE BORROWER’S FORM 10-K FOR
SUCH FISCAL YEAR, A COPY OF THE AUDITED CONSOLIDATED BALANCE SHEET OF THE
BORROWER AND ITS CONSOLIDATED SUBSIDIARIES AS AT THE END OF SUCH YEAR AND THE
RELATED AUDITED CONSOLIDATED STATEMENTS OF INCOME AND OF CASH FLOWS FOR SUCH
YEAR, SETTING FORTH IN EACH CASE IN COMPARATIVE FORM THE FIGURES FOR THE
PREVIOUS YEAR, REPORTED ON WITHOUT A “GOING CONCERN” OR LIKE QUALIFICATION OR
EXCEPTION, OR QUALIFICATION ARISING OUT OF THE SCOPE OF THE AUDIT, BY DELOITTE &
TOUCHE LLP OR OTHER INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS OF NATIONALLY
RECOGNIZED STANDING;

 

(B)                                 AS SOON AS AVAILABLE, BUT IN ANY EVENT NOT
LATER THAN THE EARLIER OF (A) 45 DAYS AFTER THE END OF EACH OF THE FIRST THREE
QUARTERLY PERIODS OF EACH FISCAL YEAR OF THE BORROWER AND (B) THE PUBLIC FILING
WITH THE SEC OF THE BORROWER’S FORM 10-Q FOR EACH SUCH FISCAL QUARTER, THE
UNAUDITED CONSOLIDATED BALANCE SHEET OF THE BORROWER AND ITS CONSOLIDATED
SUBSIDIARIES AS AT THE END OF SUCH QUARTER AND THE RELATED UNAUDITED
CONSOLIDATED STATEMENTS OF INCOME AND OF CASH FLOWS FOR SUCH QUARTER AND THE
PORTION OF THE FISCAL YEAR THROUGH THE END OF SUCH QUARTER, SETTING FORTH IN
EACH CASE IN COMPARATIVE FORM THE FIGURES FOR THE PREVIOUS YEAR, CERTIFIED BY AN
AUTHORIZED OFFICER AS BEING FAIRLY STATED IN ALL MATERIAL RESPECTS (SUBJECT TO
NORMAL YEAR-END AUDIT ADJUSTMENTS); AND

 

(C)                                  AS SOON AS PRACTICABLE, AND IN ANY EVENT
WITHIN 40 DAYS AFTER THE END OF EACH FISCAL MONTH OF EACH FISCAL YEAR OF THE
BORROWER (OR, IN THE CASE OF DECEMBER OF EACH YEAR, OR MARCH, JUNE AND
SEPTEMBER OF EACH YEAR, TOGETHER WITH THE FINANCIAL STATEMENTS REFERRED TO IN
SECTION 6.1(A) OR 6.1(B) FOR THE APPLICABLE PERIOD), THE UNAUDITED CONSOLIDATED
BALANCE SHEET OF BORROWER AND ITS SUBSIDIARIES AS AT THE END OF SUCH MONTH AND
THE RELATED UNAUDITED STATEMENTS OF INCOME OF THE BORROWER AND ITS SUBSIDIARIES
FOR SUCH MONTH AND FOR THE PORTION OF THE FISCAL YEAR OF THE BORROWER THROUGH
SUCH DATE, IN THE FORM AND DETAIL SIMILAR TO THOSE CUSTOMARILY PREPARED BY THE
BORROWER’S MANAGEMENT FOR INTERNAL USE AS IN EFFECT ON OR PRIOR TO THE CLOSING
DATE, SETTING FORTH IN EACH CASE IN COMPARATIVE FORM THE CONSOLIDATED FIGURES
FOR THE CORRESPONDING FISCAL MONTH OF THE PREVIOUS YEAR, CERTIFIED BY THE CHIEF
FINANCIAL OFFICER, CONTROLLER OR TREASURER OF THE BORROWER AS BEING FAIRLY
STATED IN ALL MATERIAL RESPECTS;

 

All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).

 

6.2                                 CERTIFICATES; OTHER INFORMATION.  FURNISH TO
THE ADMINISTRATIVE AGENT AND EACH LENDER (OR, IN THE CASE OF CLAUSE (H), TO THE
RELEVANT LENDER):

 

(A)                                  CONCURRENTLY WITH THE DELIVERY OF THE
CONSOLIDATED FINANCIAL STATEMENTS REFERRED TO IN SECTION 6.1(A), A LETTER FROM
THE INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS REPORTING ON SUCH FINANCIAL
STATEMENTS STATING THAT IN MAKING THE EXAMINATION NECESSARY TO EXPRESS THEIR
OPINION ON SUCH FINANCIAL STATEMENTS NO KNOWLEDGE WAS OBTAINED OF ANY DEFAULT OR
UNMATURED DEFAULT, EXCEPT AS SPECIFIED IN SUCH LETTER;

 

(B)                                 CONCURRENTLY WITH THE DELIVERY OF THE
FINANCIAL STATEMENTS REFERRED TO IN SECTIONS 6.1(A) AND (B), A CERTIFICATE OF
THE CHIEF FINANCIAL OFFICER OF THE BORROWER SUBSTANTIALLY IN THE FORM OF
EXHIBIT B HERETO (I) STATING THAT, TO THE BEST OF SUCH OFFICER’S KNOWLEDGE, EACH
OF THE BORROWER AND ITS SUBSIDIARIES HAS OBSERVED OR PERFORMED ALL OF ITS
COVENANTS AND OTHER AGREEMENTS, AND SATISFIED EVERY CONDITION, CONTAINED IN THIS
AGREEMENT, THE NOTES AND THE OTHER

 

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LOAN DOCUMENTS TO BE OBSERVED, PERFORMED OR SATISFIED BY IT, AND THAT SUCH
OFFICER HAS OBTAINED NO KNOWLEDGE OF ANY DEFAULT OR UNMATURED DEFAULT EXCEPT AS
SPECIFIED IN SUCH CERTIFICATE, (II) SHOWING IN DETAIL AS OF THE END OF THE
RELATED FISCAL PERIOD THE FIGURES AND CALCULATIONS SUPPORTING SUCH STATEMENT IN
RESPECT OF SECTIONS 7.1(A) THROUGH 7.1(C), (III) IF NOT SPECIFIED IN THE
FINANCIAL STATEMENTS DELIVERED PURSUANT TO SECTION 6.1, SPECIFYING THE AGGREGATE
AMOUNT OF INTEREST PAID OR ACCRUED BY THE BORROWER AND ITS SUBSIDIARIES, AND THE
AGGREGATE AMOUNT OF DEPRECIATION, DEPLETION AND AMORTIZATION CHARGED ON THE
BOOKS OF THE BORROWER AND ITS SUBSIDIARIES, DURING SUCH ACCOUNTING PERIOD AND
(IV) LISTING ALL CONTINGENT OBLIGATIONS OF THE TYPE DESCRIBED IN SECTION 7.3(A)
AND ALL INDEBTEDNESS (OTHER THAN INDEBTEDNESS HEREUNDER) IN EACH CASE INCURRED
SINCE THE DATE OF THE PREVIOUS CONSOLIDATED BALANCE SHEET OF THE BORROWER
DELIVERED PURSUANT TO SECTION 6.1(A) OR (B);

 

(C)                                  CONCURRENTLY WITH THE FINANCIAL STATEMENTS
REFERRED TO IN SECTIONS 6.1(A) AND (B), A MANAGEMENT SUMMARY DESCRIBING AND
ANALYZING THE PERFORMANCE OF THE BORROWER AND ITS SUBSIDIARIES DURING THE
PERIODS COVERED BY SUCH FINANCIAL STATEMENTS;

 

(D)                                 PROMPTLY UPON RECEIPT THEREOF, COPIES OF ALL
FINAL REPORTS SUBMITTED TO THE BORROWER OR TO ANY OF ITS SUBSIDIARIES BY
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS IN CONNECTION WITH EACH ANNUAL, INTERIM
OR SPECIAL AUDIT OF THE BOOKS OF THE BORROWER OR ANY OF ITS SUBSIDIARIES MADE BY
SUCH ACCOUNTANTS, INCLUDING, WITHOUT LIMITATION, ANY FINAL COMMENT LETTER
SUBMITTED BY SUCH ACCOUNTANTS TO MANAGEMENT IN CONNECTION WITH THEIR ANNUAL
AUDIT;

 

(E)                                  NOT LATER THAN 60 DAYS AFTER THE BEGINNING
OF EACH FISCAL YEAR OF THE BORROWER, A COPY OF THE BUSINESS PLAN FOR SUCH FISCAL
YEAR ON A CONSOLIDATED BASIS AS ADOPTED BY THE BOARD OF DIRECTORS OF THE
BORROWER;

 

(F)                                    PROMPTLY UPON THEIR BECOMING AVAILABLE,
COPIES OF ALL FINANCIAL STATEMENTS, REPORTS, NOTICES AND PROXY STATEMENTS SENT
OR MADE AVAILABLE GENERALLY BY THE BORROWER OR ANY OF ITS SUBSIDIARIES TO ITS
SHAREHOLDERS AND ALL REGULAR AND PERIODIC REPORTS AND ALL FINAL REGISTRATION
STATEMENTS AND FINAL PROSPECTUSES, IF ANY, FILED BY THE BORROWER OR ANY OF ITS
SUBSIDIARIES WITH ANY SECURITIES EXCHANGE OR WITH THE SEC OR ANY GOVERNMENTAL
AUTHORITY SUCCEEDING TO ANY OF ITS FUNCTIONS;

 

(G)                                 WITHIN 20 BUSINESS DAYS AFTER THE LAST DAY
OF EACH FISCAL MONTH OF THE BORROWER, A FULLY COMPLETED AND EXECUTED BORROWING
BASE CERTIFICATE AS OF SUCH LAST DAY OF SUCH FISCAL MONTH OF THE BORROWER; AND

 

(H)                                 PROMPTLY, SUCH ADDITIONAL FINANCIAL AND
OTHER INFORMATION AS ANY LENDER MAY FROM TIME TO TIME REASONABLY REQUEST.

 

6.3                                 PAYMENT OF OBLIGATIONS.  PAY, DISCHARGE OR
OTHERWISE SATISFY AT OR BEFORE MATURITY OR BEFORE THEY BECOME DELINQUENT, AS THE
CASE MAY BE, ALL ITS MATERIAL OBLIGATIONS OF WHATEVER NATURE, EXCEPT WHERE THE
AMOUNT OR VALIDITY THEREOF IS CURRENTLY BEING CONTESTED IN GOOD FAITH BY
APPROPRIATE PROCEEDINGS AND RESERVES IN CONFORMITY WITH GAAP WITH RESPECT
THERETO HAVE BEEN PROVIDED ON THE BOOKS OF THE BORROWER OR ITS SUBSIDIARIES, AS
THE CASE MAY BE.

 

6.4                                 MAINTENANCE OF EXISTENCE; COMPLIANCE.  (A)
(I) PRESERVE, RENEW AND KEEP IN FULL FORCE AND EFFECT ITS CORPORATE EXISTENCE
AND (II) TAKE ALL REASONABLE ACTION TO MAINTAIN ALL RIGHTS, PRIVILEGES AND
FRANCHISES NECESSARY OR DESIRABLE IN THE NORMAL CONDUCT OF ITS BUSINESS, EXCEPT,
IN EACH CASE, AS OTHERWISE PERMITTED BY SECTION 7.4 AND EXCEPT, IN THE CASE OF
CLAUSE (II) ABOVE, TO THE EXTENT THAT FAILURE TO DO SO COULD NOT REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT; AND (B) COMPLY WITH ALL CONTRACTUAL

 

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Obligations and Requirements of Law except to the extent that failure to comply
therewith could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

6.5                                 MAINTENANCE OF PROPERTY; INSURANCE.  (A) 
KEEP ALL PROPERTY USEFUL AND NECESSARY IN ITS BUSINESS IN GOOD WORKING ORDER AND
CONDITION, ORDINARY WEAR AND TEAR EXCEPTED AND (B) MAINTAIN WITH FINANCIALLY
SOUND AND REPUTABLE INSURANCE COMPANIES INSURANCE ON ALL ITS PROPERTY IN AT
LEAST SUCH AMOUNTS AND AGAINST AT LEAST SUCH RISKS (BUT INCLUDING IN ANY EVENT
PUBLIC LIABILITY, PRODUCT LIABILITY AND BUSINESS INTERRUPTION) AS ARE USUALLY
INSURED AGAINST IN THE SAME GENERAL AREA BY COMPANIES ENGAGED IN THE SAME OR A
SIMILAR BUSINESS.

 

6.6                                 INSPECTION OF PROPERTY; BOOKS AND RECORDS,
DISCUSSIONS.  (A)  KEEP PROPER BOOKS OF RECORDS AND ACCOUNT IN WHICH FULL, TRUE
AND CORRECT ENTRIES IN CONFORMITY WITH GAAP AND ALL REQUIREMENTS OF LAW SHALL BE
MADE OF ALL DEALINGS AND TRANSACTIONS IN RELATION TO ITS BUSINESS AND
ACTIVITIES, (B) PERMIT REPRESENTATIVES OF ANY LENDER, AT SUCH LENDER’S EXPENSE,
TO VISIT AND INSPECT ANY OF ITS PROPERTIES AND EXAMINE ANY OF ITS BOOKS AND
RECORDS UPON REASONABLE NOTICE TO THE BORROWER (PROVIDED, THAT, FOR SO LONG AS
NO DEFAULT HAS OCCURRED AND IS CONTINUING, SUCH REQUESTS AND VISITATIONS (I)
SHALL BE COORDINATED THROUGH THE ADMINISTRATIVE AGENT, AND (II) SHALL NOT
INTERFERE WITH OR DISRUPT OPERATIONS OF THE BORROWER OR ITS SUBSIDIARIES), AND
(C) DISCUSS THE BUSINESS, OPERATIONS, PROPERTIES AND FINANCIAL AND OTHER
CONDITION OF THE BORROWER AND ITS SUBSIDIARIES WITH OFFICERS AND EMPLOYEES OF
THE BORROWER AND ITS SUBSIDIARIES AND WITH ITS INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS AT ANY REASONABLE TIME.

 

6.7                                 NOTICES.  PROMPTLY GIVE NOTICE TO THE
ADMINISTRATIVE AGENT AND EACH LENDER OF:

 

(A)                                  THE OCCURRENCE OF ANY DEFAULT OR UNMATURED
DEFAULT;

 

(B)                                 ANY (I) DEFAULT OR EVENT OF DEFAULT UNDER
ANY CONTRACTUAL OBLIGATION OF THE BORROWER OR ANY OF ITS SUBSIDIARIES OR (II)
LITIGATION, INVESTIGATION OR PROCEEDING THAT MAY EXIST AT ANY TIME BETWEEN THE
BORROWER OR ANY OF ITS SUBSIDIARIES AND ANY GOVERNMENTAL AUTHORITY, THAT IN
EITHER CASE, IF NOT CURED OR IF ADVERSELY DETERMINED, AS THE CASE MAY BE, COULD
REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT;

 

(C)                                  ANY LITIGATION OR PROCEEDING AFFECTING THE
BORROWER OR ANY OF ITS SUBSIDIARIES IN WHICH THE AMOUNT INVOLVED IS $1,000,000
OR MORE AND NOT COVERED BY INSURANCE OR IN WHICH INJUNCTIVE OR SIMILAR RELIEF IS
SOUGHT THAT IF NOT CURED OR IF ADVERSELY DETERMINED, AS THE CASE MAY BE, COULD
REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT;

 

(D)                                 THE FOLLOWING EVENTS, AS SOON AS POSSIBLE
AND IN ANY EVENT WITHIN 30 DAYS AFTER THE BORROWER KNOWS OR HAS REASON TO KNOW
THEREOF:  (I) THE OCCURRENCE OF ANY REPORTABLE EVENT WITH RESPECT TO ANY PLAN, A
FAILURE TO MAKE ANY REQUIRED CONTRIBUTION TO A PLAN, THE CREATION OF ANY LIEN IN
FAVOR OF THE PBGC OR A SINGLE EMPLOYER PLAN OR ANY WITHDRAWAL FROM, OR THE
TERMINATION, REORGANIZATION OR INSOLVENCY OF, ANY MULTIEMPLOYER PLAN OR (II) THE
INSTITUTION OF PROCEEDINGS OR THE TAKING OF ANY OTHER ACTION BY THE PBGC OR THE
BORROWER OR ANY COMMONLY CONTROLLED ENTITY OR ANY MULTIEMPLOYER PLAN WITH
RESPECT TO THE WITHDRAWAL FROM, OR THE TERMINATION, REORGANIZATION OR INSOLVENCY
OF, ANY PLAN; AND

 

(E)                                  ANY DEVELOPMENT OR EVENT THAT HAS HAD OR
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
an Authorized Officer setting forth details of the occurrence referred to
therein and stating what action the Borrower or the relevant Subsidiary proposes
to take with respect thereto.

 

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6.8                                 Environmental Laws.

 

(A)                                  COMPLY IN ALL MATERIAL RESPECTS WITH ALL
APPLICABLE ENVIRONMENTAL LAWS, AND OBTAIN AND COMPLY IN ALL MATERIAL RESPECTS
WITH AND MAINTAIN, ANY AND ALL MATERIAL LICENSES, APPROVALS, NOTIFICATIONS,
REGISTRATIONS OR PERMITS REQUIRED BY APPLICABLE ENVIRONMENTAL LAWS.

 

(B)                                 CONDUCT AND COMPLETE ALL INVESTIGATIONS,
STUDIES, SAMPLING AND TESTING, AND ALL REMEDIAL, REMOVAL AND OTHER ACTIONS
REQUIRED UNDER ENVIRONMENTAL LAWS AND PROMPTLY COMPLY IN ALL MATERIAL RESPECTS
WITH ALL LAWFUL ORDERS AND DIRECTIVES OF ALL GOVERNMENTAL AUTHORITIES REGARDING
ENVIRONMENTAL LAWS.

 

6.9                                 ADDITIONAL COLLATERAL, GUARANTIES, ETC.  IF,
AFTER THE DATE HEREOF, ANY MATERIAL SUBSIDIARY OF THE BORROWER SHALL BE FORMED,
ACQUIRED OR CAPITALIZED, PROMPTLY DELIVER TO THE ADMINISTRATIVE AGENT, AS
APPLICABLE, (A) A STOCK CERTIFICATE OR CERTIFICATES EVIDENCING ALL OF THE ISSUED
AND OUTSTANDING SHARES OF CAPITAL STOCK OF SUCH SUBSIDIARY HELD BY THE BORROWER
OR A SUBSIDIARY, TOGETHER WITH UNDATED STOCK POWERS COVERING EACH SUCH
CERTIFICATE, DULY EXECUTED IN BLANK BY THE BORROWER OR THE SUBSIDIARY THAT
DIRECTLY OWNS SUCH CAPITAL STOCK, (B) A SUPPLEMENT TO THE GUARANTEE AND
COLLATERAL AGREEMENT, EXECUTED BY A DULY AUTHORIZED OFFICER OF THE BORROWER AND
SUCH SUBSIDIARY, PURSUANT TO WHICH THE CAPITAL STOCK OF ANY SUCH SUBSIDIARY
ACQUIRED OR CREATED IS PLEDGED THEREUNDER ON THE SAME TERMS AS THOSE PROVIDED IN
RESPECT OF PLEDGES UNDER THE GUARANTEE AND COLLATERAL AGREEMENT ON THE CLOSING
DATE AND PURSUANT TO WHICH ANY SUCH SUBSIDIARY (AND THE SUBSIDIARY (TO THE
EXTENT NOT ALREADY A PARTY TO THE GUARANTEE AND COLLATERAL AGREEMENT) THAT
DIRECTLY OWNS THE CAPITAL STOCK OF SUCH SUBSIDIARY) BECOMES A SUBSIDIARY
GUARANTOR THEREUNDER ON THE SAME TERMS AS THOSE PROVIDED IN RESPECT OF PLEDGES
UNDER THE GUARANTEE AND COLLATERAL AGREEMENT ON THE CLOSING DATE, PURSUANT TO
DOCUMENTATION SATISFACTORY TO THE ADMINISTRATIVE AGENT, (C) LEGAL OPINIONS WITH
RESPECT TO THE PLEDGE OF STOCK FROM THE GENERAL COUNSEL OF THE BORROWER AND/OR
SUCH OTHER COUNSEL AS ARE REASONABLY SATISFACTORY TO THE ADMINISTRATIVE AGENT;
PROVIDED, THAT THE SCOPE OF SUCH OPINIONS SHALL BE NO BROADER THAN THE SCOPE OF
THE OPINIONS OF SUCH COUNSEL DELIVERED ON THE CLOSING DATE, AND (D) SUCH OTHER
CERTIFICATES, RESOLUTIONS AND DOCUMENTS AS THE ADMINISTRATIVE AGENT MAY
REASONABLY REQUEST; PROVIDED, THAT IF SUCH SUBSIDIARY IS A FOREIGN SUBSIDIARY,
NOT MORE THAN 65% OF THE TOTAL COMBINED VOTING POWER OF ALL CLASSES OF SUCH
SUBSIDIARY’S CAPITAL STOCK ENTITLED TO VOTE SHALL BE REQUIRED TO BE PLEDGED
PURSUANT TO THIS SUBSECTION; PROVIDED, FURTHER, THAT (I) NO CAPITAL STOCK OF ANY
FOREIGN SUBSIDIARY OWNED BY ANOTHER FOREIGN SUBSIDIARY SHALL BE REQUIRED TO BE
PLEDGED PURSUANT TO THIS SECTION 6.9 AND (II) NO SUCH SUBSIDIARY SHALL BE
REQUIRED TO BECOME A GUARANTOR IF IT IS A FOREIGN SUBSIDIARY.  IN ADDITION, THE
BORROWER SHALL FROM TIME TO TIME PROMPTLY TAKE ALL NECESSARY ACTIONS IN THE
FOREGOING CLAUSES (A) THROUGH (D) WITH RESPECT TO SUBSIDIARIES IN ORDER TO
COMPLY WITH THE DEFINITION OF “MATERIAL SUBSIDIARY.”

 

ARTICLE VII

 

NEGATIVE COVENANTS

 

Until all of the Obligations have been indefeasibly paid in full and the
Aggregate Commitment has been terminated, unless the Required Lenders otherwise
consent, the Borrower shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly:

 

7.1                                 Financial Condition Covenants.

 

(A)                                  CONSOLIDATED INTEREST COVERAGE RATIO.  AT
THE LAST DAY OF ANY FISCAL QUARTER, PERMIT THE CONSOLIDATED INTEREST COVERAGE
RATIO OF THE BORROWER FOR THE PERIOD OF FOUR CONSECUTIVE FISCAL QUARTERS ENDING
ON SUCH DAY TO BE LESS THAN 4.00 TO 1.00.

 

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(B)                                 CONSOLIDATED LEVERAGE RATIO.  AT THE LAST
DAY OF ANY FISCAL QUARTER PERMIT THE CONSOLIDATED LEVERAGE RATIO OF THE BORROWER
FOR THE PERIOD OF FOUR CONSECUTIVE FISCAL QUARTERS ENDING ON SUCH DAY TO BE MORE
THAN 2.75 TO 1.00.

 

(C)                                  CONSOLIDATED NET WORTH.  AT THE LAST DAY OF
ANY FISCAL QUARTER PERMIT CONSOLIDATED NET WORTH OF THE BORROWER TO BE LESS THAN
THE GREATER OF (I) $80,000,000, OR (II) 75% OF CONSOLIDATED NET WORTH AS OF
OCTOBER 4, 2003.

 

7.2                                 INDEBTEDNESS.  CREATE, ISSUE, INCUR, ASSUME,
BECOME LIABLE IN RESPECT OF OR SUFFER TO EXIST ANY INDEBTEDNESS, EXCEPT:

 

(A)                                  INDEBTEDNESS OF ANY LOAN PARTY PURSUANT TO
ANY LOAN DOCUMENT OR UNDER THE FACILITY LCS;

 

(B)                                 INDEBTEDNESS OF THE BORROWER TO ANY
SUBSIDIARY GUARANTOR AND ANY CONSOLIDATED SUBSIDIARY GUARANTOR (OR ANY OTHER
SUBSIDIARY IF SUCH INDEBTEDNESS IS SUBORDINATED TO THE OBLIGATIONS ON TERMS
SATISFACTORY TO THE ADMINISTRATIVE AGENT) TO THE BORROWER OR ANY OTHER
SUBSIDIARY;

 

(C)                                  GUARANTEE OBLIGATIONS INCURRED IN THE
ORDINARY COURSE OF BUSINESS BY THE BORROWER OR ANY OF ITS SUBSIDIARIES OF
OBLIGATIONS OF ANY CONSOLIDATED SUBSIDIARY GUARANTOR;

 

(D)                                 INDEBTEDNESS OUTSTANDING ON THE DATE HEREOF
AND LISTED ON SCHEDULE 7.2(D) AND ANY REFINANCINGS, REFUNDINGS, RENEWALS OR
EXTENSIONS THEREOF (WITHOUT INCREASING, OR SHORTENING THE MATURITY OF, THE
PRINCIPAL AMOUNT THEREOF);

 

(E)                                  ADDITIONAL INDEBTEDNESS OF THE SUBSIDIARIES
OF THE BORROWER (OTHER THAN INDEBTEDNESS OWED TO THE BORROWER OR ANOTHER
SUBSIDIARY) IN AN AGGREGATE PRINCIPAL AMOUNT WHICH WHEN ADDED TO THE
INDEBTEDNESS PERMITTED BY SECTION 7.2(H) SHALL NOT EXCEED AN AMOUNT EQUAL TO 20%
OF CONSOLIDATED NET WORTH AT ANY ONE TIME OUTSTANDING CALCULATED AS OF THE END
OF THE MOST RECENTLY COMPLETED FISCAL QUARTER FOR WHICH FINANCIAL STATEMENTS
HAVE BEEN DELIVERED PURSUANT TO SECTION 6.1(A) OR (B), SO LONG AS NO DEFAULT
EXISTS AT THE TIME OF INCURRENCE THEREOF;

 

(F)                                    ADDITIONAL UNSECURED INDEBTEDNESS OF THE
BORROWER SO LONG AS (I) THE BORROWER, AFTER GIVING PRO FORMA EFFECT AS IF SUCH
INDEBTEDNESS HAD BEEN INCURRED ON THE FIRST DAY OF THE MOST RECENTLY ENDED
PERIOD OF FOUR CONSECUTIVE FISCAL QUARTERS OF THE BORROWER FOR WHICH FINANCIAL
STATEMENTS HAVE BEEN DELIVERED PURSUANT TO SECTION 6.1(A) OR (B), WOULD BE IN
COMPLIANCE WITH THE FINANCIAL COVENANTS SET FORTH IN SECTION 7.1, (II) AT THE
TIME OF INCURRENCE THEREOF NO DEFAULT OR UNMATURED DEFAULT SHALL HAVE OCCURRED
AND BE CONTINUING OR WOULD RESULT THEREFROM, (III) THE TERMS OF SUCH
INDEBTEDNESS, VIEWED AS A WHOLE, ARE NO MORE FAVORABLE TO THE HOLDERS OF SUCH
INDEBTEDNESS OR BURDENSOME ON THE BORROWER OR ANY SUBSIDIARY THAN THE TERMS OF
ANY LOAN DOCUMENT (OTHER THAN INTEREST RATES WHICH SHALL BE AT MARKET RATES),
(IV) NO PRINCIPAL PAYMENTS ON SUCH INDEBTEDNESS ARE REQUIRED TO BE MADE ON OR
PRIOR TO THE FACILITY TERMINATION DATE AND (V) SUCH INDEBTEDNESS DOES NOT
CONSTITUTE INDEBTEDNESS OF THE TYPE DESCRIBED IN CLAUSE (H) OF THE DEFINITION
THEREOF;

 

(G)                                 ADDITIONAL UNSECURED GUARANTEE OBLIGATIONS
OF THE SUBSIDIARIES OF THE BORROWER IN RESPECT OF INDEBTEDNESS INCURRED UNDER
SECTION 7.2(F), SO LONG AS SUCH GUARANTEE OBLIGATIONS ARE PARI PASSU WITH (OR
HAVE INTERESTS OR RIGHTS THAT ARE INFERIOR TO PARI PASSU WITH) THE GUARANTEE
OBLIGATIONS UNDER THE LOAN DOCUMENTS AND SO LONG AS THE TERMS OF SUCH GUARANTEE
OBLIGATIONS ARE NO MORE FAVORABLE TO THE HOLDERS OF SUCH INDEBTEDNESS OR
BURDENSOME ON THE

 

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BORROWER OR ANY SUBSIDIARY THAN THE TERMS OF THE GUARANTEE OBLIGATIONS UNDER THE
LOAN DOCUMENTS;

 

(H)                                 ADDITIONAL INDEBTEDNESS SECURED BY A LIEN
PURSUANT TO SECTION 7.3(I) WHICH, WHEN ADDED TO ANY OUTSTANDING INDEBTEDNESS
PERMITTED TO BE INCURRED UNDER SECTION 7.2(E), SHALL NOT EXCEED THE AMOUNT EQUAL
TO 20% OF CONSOLIDATED NET WORTH AT ANY ONE TIME OUTSTANDING CALCULATED AS OF
THE END OF THE MOST RECENTLY COMPLETED FISCAL QUARTER FOR WHICH FINANCIAL
STATEMENTS HAVE BEEN DELIVERED PURSUANT TO SECTION 6.1(A) OR (B); AND

 

(I)                                     ADDITIONAL INDEBTEDNESS (INCLUDING,
WITHOUT LIMITATION, CAPITAL LEASE OBLIGATIONS, BUT EXCLUDING INDEBTEDNESS OF ANY
SUBSIDIARY OWED TO THE BORROWER OR ANOTHER SUBSIDIARY) SECURED BY LIENS
PERMITTED BY SECTION 7.3(J); PROVIDED, THAT THE AGGREGATE PRINCIPAL AMOUNT OF
SUCH INDEBTEDNESS INCURRED IN ANY FISCAL YEAR PURSUANT TO THIS CLAUSE (I) DOES
NOT EXCEED THE SUM OF (X) $5,000,000 AND (Y) THE PORTION OF THE AMOUNT PERMITTED
TO BE INCURRED PURSUANT TO THIS CLAUSE (I) IN THE FISCAL YEARS PRIOR TO SUCH
FISCAL YEAR TO THE EXTENT NOT UTILIZED TO INCUR INDEBTEDNESS PURSUANT TO THIS
CLAUSE (I) IN ANY OTHER FISCAL YEAR PRIOR TO SUCH CURRENT FISCAL YEAR.

 

7.3                                 LIENS.  CREATE, INCUR, ASSUME OR SUFFER TO
EXIST ANY LIEN UPON ANY OF ITS PROPERTY, WHETHER NOW OWNED OR HEREAFTER
ACQUIRED, EXCEPT FOR:

 

(A)                                  LIENS FOR TAXES, ASSESSMENTS OR OTHER
GOVERNMENTAL CHARGES OR LEVIES NOT YET DUE OR THAT ARE BEING CONTESTED IN GOOD
FAITH BY APPROPRIATE PROCEEDINGS; PROVIDED THAT ADEQUATE RESERVES WITH RESPECT
THERETO ARE MAINTAINED ON THE BOOKS OF THE BORROWER OR ITS SUBSIDIARIES, AS THE
CASE MAY BE, IN CONFORMITY WITH GAAP;

 

(B)                                 CARRIERS’, WAREHOUSEMEN’S, MECHANICS’,
MATERIALMEN’S, REPAIRMEN’S, CUSTOMS OR OTHER LIKE LIENS ARISING IN THE ORDINARY
COURSE OF BUSINESS THAT ARE NOT OVERDUE FOR A PERIOD OF MORE THAN 30 DAYS OR
THAT ARE BEING CONTESTED IN GOOD FAITH BY APPROPRIATE PROCEEDINGS; PROVIDED THAT
ADEQUATE RESERVES WITH RESPECT THERETO ARE MAINTAINED ON THE BOOKS OF THE
BORROWER OR ITS SUBSIDIARIES, AS THE CASE MAY BE, IN CONFORMITY WITH GAAP;

 

(C)                                  PLEDGES OR DEPOSITS IN CONNECTION WITH
WORKERS’ COMPENSATION, UNEMPLOYMENT INSURANCE AND OTHER SOCIAL SECURITY
LEGISLATION;

 

(D)                                 DEPOSITS (I) TO SECURE PERMITTED
ACQUISITIONS SO LONG AS THE AGGREGATE AMOUNT OF ALL DEPOSITS AT ANY TIME
OUTSTANDING DOES NOT EXCEED $3,000,000 AND (II) TO SECURE THE PERFORMANCE OF
BIDS, TRADE CONTRACTS (OTHER THAN FOR BORROWED MONEY), LEASES, STATUTORY
OBLIGATIONS, SURETY AND APPEAL BONDS, PERFORMANCE BONDS AND OTHER OBLIGATIONS OF
A LIKE NATURE INCURRED IN THE ORDINARY COURSE OF BUSINESS;

 

(E)                                  EASEMENTS, RIGHTS OF WAY, RESTRICTIONS AND
OTHER SIMILAR ENCUMBRANCES INCURRED IN THE ORDINARY COURSE OF BUSINESS THAT, IN
THE AGGREGATE, ARE NOT SUBSTANTIAL IN AMOUNT AND THAT DO NOT IN ANY CASE
MATERIALLY DETRACT FROM THE VALUE OF THE PROPERTY SUBJECT THERETO OR MATERIALLY
INTERFERE WITH THE ORDINARY CONDUCT OF THE BUSINESS OF THE BORROWER OR ANY OF
ITS SUBSIDIARIES;

 

(F)                                    LIENS IN EXISTENCE ON THE DATE HEREOF
LISTED ON SCHEDULE 7.3(F), SECURING INDEBTEDNESS PERMITTED BY SECTION 7.2(D);
PROVIDED, THAT NO SUCH LIEN IS SPREAD TO COVER ANY ADDITIONAL PROPERTY AFTER THE
CLOSING DATE AND THAT THE AMOUNT OF INDEBTEDNESS SECURED THEREBY IS NOT
INCREASED;

 

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(G)                                 LIENS CREATED PURSUANT TO THE COLLATERAL
DOCUMENTS;

 

(H)                                 LIENS ARISING IN CONNECTION WITH ORDINARY
COMMERCIAL BANKING TRANSACTIONS, INCLUDING REPURCHASE AGREEMENTS;

 

(I)                                     ADDITIONAL LIENS SECURING INDEBTEDNESS
(INCLUDING, WITHOUT LIMITATION, CAPITAL LEASE OBLIGATIONS) OF THE BORROWER AND
ITS SUBSIDIARIES WHICH WHEN ADDED TO INDEBTEDNESS PERMITTED UNDER SECTION 7.2(E)
SHALL NOT EXCEED THE AMOUNT EQUAL TO 20% OF CONSOLIDATED NET WORTH AT ANY ONE
TIME OUTSTANDING CALCULATED AS OF THE END OF THE MOST RECENTLY COMPLETED FISCAL
QUARTER FOR WHICH FINANCIAL STATEMENTS PURSUANT TO SECTIONS 6.1(A) AND 6.1(B)
HAVE BEEN DELIVERED, SO LONG AS (I) NO SUCH LIEN ENCUMBERS ANY COLLATERAL AND
(II) NO DEFAULT EXISTS AT THE TIME OF THE CREATION OR INCURRENCE OF SUCH LIEN OR
WOULD RESULT THEREFROM; AND

 

(J)                                     LIENS SECURING INDEBTEDNESS OF THE
BORROWER OR ANY SUBSIDIARY INCURRED PURSUANT TO SECTION 7.2(I) TO FINANCE THE
ACQUISITION OF FIXED OR CAPITAL ASSETS CONSTITUTING PLANT, PROPERTY OR
EQUIPMENT; PROVIDED THAT (I) SUCH LIENS SHALL BE CREATED SUBSTANTIALLY
SIMULTANEOUSLY WITH THE ACQUISITION OF SUCH FIXED OR CAPITAL ASSETS, AND (II)
SUCH LIENS DO NOT AT ANY TIME ENCUMBER ANY PROPERTY OTHER THAN THE PROPERTY
FINANCED BY SUCH INDEBTEDNESS.

 

7.4                                 FUNDAMENTAL CHANGES.  ENTER INTO ANY MERGER,
CONSOLIDATION OR AMALGAMATION, OR LIQUIDATE, WIND UP OR DISSOLVE ITSELF (OR
SUFFER ANY LIQUIDATION OR DISSOLUTION), OR DISPOSE OF, ALL OR SUBSTANTIALLY ALL
OF ITS PROPERTY OR BUSINESS, EXCEPT THAT:

 

(A)                                  ANY SUBSIDIARY OF THE BORROWER MAY BE
MERGED OR CONSOLIDATED WITH OR INTO THE BORROWER (PROVIDED THAT THE BORROWER
SHALL BE THE CONTINUING OR SURVIVING CORPORATION) OR WITH OR INTO ANY
CONSOLIDATED SUBSIDIARY GUARANTOR (PROVIDED THAT THE CONSOLIDATED SUBSIDIARY
GUARANTOR SHALL BE THE CONTINUING OR SURVIVING CORPORATION);

 

(B)                                 ANY SUBSIDIARY OF THE BORROWER MAY DISPOSE
OF ANY OR ALL OF ITS ASSETS (UPON VOLUNTARY LIQUIDATION OR OTHERWISE) TO THE
BORROWER OR ANY CONSOLIDATED SUBSIDIARY GUARANTOR;

 

(C)                                  THE BORROWER MAY DISPOSE OF ANY OF ITS
ASSETS AND THE SUBSIDIARIES OF THE BORROWER MAY DISPOSE OF ANY OR ALL OF THEIR
ASSETS, IN ANY SUCH CASE IN A TRANSACTION SATISFYING THE REQUIREMENTS OF
SECTION 7.5; AND

 

(D)                                 THE SUBSIDIARIES OF THE BORROWER MAY ENTER
INTO ANY MERGER, CONSOLIDATION OR ACQUISITION TRANSACTION MEETING THE
REQUIREMENTS OF SECTION 7.7(G).

 

7.5                                 DISPOSITION OF PROPERTY.  DISPOSE OF ANY OF
ITS PROPERTY, WHETHER NOW OWNED OR HEREAFTER ACQUIRED, OR, IN THE CASE OF ANY
SUBSIDIARY, ISSUE OR SELL ANY SHARES OF SUCH SUBSIDIARY’S CAPITAL STOCK TO ANY
PERSON, EXCEPT:

 

(A)                                  THE DISPOSITION OF OBSOLETE OR WORN OUT
PROPERTY IN THE ORDINARY COURSE OF BUSINESS;

 

(B)                                 THE SALE OF INVENTORY IN THE ORDINARY COURSE
OF BUSINESS;

 

(C)                                  DISPOSITIONS PERMITTED BY SECTION 7.4(B);

 

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(D)                                 THE SALE OR ISSUANCE OF ANY SUBSIDIARY’S
CAPITAL STOCK TO THE BORROWER OR ANY CONSOLIDATED SUBSIDIARY GUARANTOR AND, IN
THE EVENT THAT THE BORROWER OR SUCH CONSOLIDATED SUBSIDIARY GUARANTOR DOES NOT
OWN ALL OF THE APPLICABLE CLASS OF SUCH CAPITAL STOCK, TO ANY MINORITY HOLDER OF
SUCH CAPITAL STOCK ON A PRO RATA BASIS BASED ON THE INTERESTS OF SUCH HOLDERS
IMMEDIATELY PRIOR THERETO; AND

 

(E)                                  SUBSIDIARY STOCK EVENTS AND DISPOSITIONS OF
ANY OTHER PROPERTY (INCLUDING, WITHOUT LIMITATION, COLLATERAL) HAVING A FAIR
MARKET VALUE NOT TO EXCEED (I) $50,000,000 IN THE AGGREGATE CUMULATIVELY AFTER
THE CLOSING DATE AND (II) $20,000,000 DURING ANY FISCAL YEAR OF THE BORROWER.

 

7.6                                 RESTRICTED PAYMENTS.  DECLARE OR PAY ANY
DIVIDEND (OTHER THAN DIVIDENDS PAYABLE SOLELY IN COMMON STOCK OF THE PERSON
MAKING SUCH DIVIDEND) ON, OR MAKE ANY PAYMENT ON ACCOUNT OF, OR SET APART ASSETS
FOR A SINKING OR OTHER ANALOGOUS FUND FOR, THE PURCHASE, REDEMPTION, DEFEASANCE,
RETIREMENT OR OTHER ACQUISITION OF, ANY CAPITAL STOCK OF THE BORROWER OR ANY
SUBSIDIARY, WHETHER NOW OR HEREAFTER OUTSTANDING, OR MAKE ANY OTHER DISTRIBUTION
IN RESPECT THEREOF, EITHER DIRECTLY OR INDIRECTLY, WHETHER IN CASH OR PROPERTY
OR IN OBLIGATIONS OF THE BORROWER OR ANY SUBSIDIARY (COLLECTIVELY, “RESTRICTED
PAYMENTS”), EXCEPT THAT:

 

(A)                                  ANY SUBSIDIARY MAY MAKE RESTRICTED PAYMENTS
(I) TO THE BORROWER OR ANY CONSOLIDATED SUBSIDIARY GUARANTOR AND, IN THE EVENT
THAT THE BORROWER OR SUCH CONSOLIDATED SUBSIDIARY GUARANTOR DOES NOT OWN ALL OF
THE APPLICABLE CLASS OF THE CAPITAL STOCK IN RESPECT OF WHICH SUCH RESTRICTED
PAYMENT IS MADE, TO THE MINORITY HOLDERS OF SUCH CAPITAL STOCK, SO LONG AS SUCH
RESTRICTED PAYMENTS SHALL BE MADE PRO RATA BASED ON THE INTERESTS OF SUCH
HOLDERS IMMEDIATELY PRIOR THERETO, OR (II) TO ANY OTHER SUBSIDIARY AND IN THE
EVENT THAT SUCH SUBSIDIARY DOES NOT OWN ALL OF THE APPLICABLE CLASS OF THE
CAPITAL STOCK IN RESPECT OF WHICH SUCH RESTRICTED PAYMENT IS MADE, TO THE
MINORITY HOLDERS OF SUCH CAPITAL STOCK, SO LONG AS SUCH RESTRICTED PAYMENTS
SHALL BE MADE PRO RATA BASED ON THE INTERESTS OF SUCH HOLDERS IMMEDIATELY PRIOR
THERETO, AND SO LONG AS SUCH RESTRICTED PAYMENTS RECEIVED BY SUCH SUBSIDIARY
ARE, IMMEDIATELY UPON RECEIPT THEREOF, MADE AS RESTRICTED PAYMENTS TO THE
BORROWER OR ANY CONSOLIDATED SUBSIDIARY GUARANTOR IN ACCORDANCE WITH CLAUSE (I)
ABOVE; AND

 

(B)                                 SO LONG AS NO DEFAULT OR UNMATURED DEFAULT
SHALL HAVE OCCURRED AND BE CONTINUING OR WOULD RESULT THEREFROM, THE BORROWER
MAY PAY DIVIDENDS AND REDEEM OR REPURCHASE ITS CAPITAL STOCK IF, AFTER GIVING
EFFECT THERETO, IT WOULD BE IN COMPLIANCE WITH THE FINANCIAL COVENANTS SET FORTH
IN SECTION 7.1, ON A PRO FORMA BASIS AS OF THE LAST DAY OF THE MOST RECENTLY
COMPLETED FISCAL QUARTER FOR WHICH FINANCIAL STATEMENTS HAVE BEEN DELIVERED
PURSUANT TO SECTION 6.1(A) OR (B).

 

7.7                                 INVESTMENTS.  MAKE ANY ADVANCE, LOAN,
EXTENSION OF CREDIT (BY WAY OF GUARANTY OR OTHERWISE) OR CAPITAL CONTRIBUTION
TO, OR PURCHASE ANY CAPITAL STOCK, BONDS, NOTES, DEBENTURES OR OTHER DEBT
SECURITIES OF, OR ANY ASSETS CONSTITUTING A BUSINESS UNIT OF, OR MAKE ANY OTHER
INVESTMENT IN, ANY PERSON (ALL OF THE FOREGOING, “INVESTMENTS”), EXCEPT:

 

(A)                                  EXTENSIONS OF TRADE CREDIT IN THE ORDINARY
COURSE OF BUSINESS;

 

(B)                                 INVESTMENTS IN CASH EQUIVALENTS;

 

(C)                                  GUARANTEE OBLIGATIONS PERMITTED BY
SECTION 7.2 AND ADVANCES PERMITTED BY SECTION 7.2(B);

 

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(D)                                 LOANS AND ADVANCES TO EMPLOYEES AND SALES
REPRESENTATIVES OF THE BORROWER OR ANY SUBSIDIARY OF THE BORROWER IN THE
ORDINARY COURSE OF BUSINESS (INCLUDING FOR TRAVEL, ENTERTAINMENT AND RELOCATION
EXPENSES) IN AN AGGREGATE AMOUNT FOR THE BORROWER OR ANY SUBSIDIARY OF THE
BORROWER NOT TO EXCEED $1,000,000 AT ANY ONE TIME OUTSTANDING;

 

(E)                                  INVESTMENTS IN ASSETS USEFUL IN THE
BUSINESS OF THE BORROWER AND ITS SUBSIDIARIES MADE BY THE BORROWER OR ANY OF ITS
SUBSIDIARIES WITH THE PROCEEDS OF ANY REINVESTMENT DEFERRED AMOUNT;

 

(F)                                    INVESTMENTS BY THE BORROWER OR ANY OF ITS
SUBSIDIARIES IN THE BORROWER OR ANY PERSON THAT, PRIOR TO AND AFTER SUCH
INVESTMENT, IS A CONSOLIDATED SUBSIDIARY GUARANTOR; AND

 

(G)                                 THE BORROWER OR ANY SUBSIDIARY MAY MAKE
PERMITTED ACQUISITIONS, AND MAY CREATE SUBSIDIARIES TO OWN, DIRECTLY OR
INDIRECTLY, THE PROPERTY ACQUIRED THEREBY; PROVIDED THAT (I) ANY ACQUISITION OF
CAPITAL STOCK RESULTS IN THE ISSUER THEREOF BECOMING A SUBSIDIARY, (II) ANY
MATERIAL SUBSIDIARY CREATED OR ACQUIRED IN CONNECTION THEREWITH SHALL BECOME A
SUBSIDIARY GUARANTOR AND THE REQUIREMENTS OF SECTION 6.9 SHALL BE SATISFIED
PRIOR TO OR CONCURRENTLY WITH THE CONSUMMATION OF SUCH PERMITTED ACQUISITION,
(III) NO PERMITTED ACQUISITION SHALL BE CONSUMMATED UNLESS, AFTER GIVING PRO
FORMA EFFECT THERETO AS IF SUCH PERMITTED ACQUISITION HAD BEEN MADE (AND THE
RELATED INDEBTEDNESS INCURRED OR ASSUMED) ON THE FIRST DAY OF THE MOST RECENT
PERIOD OF FOUR CONSECUTIVE FISCAL QUARTERS ENDING PRIOR THERETO FOR WHICH
FINANCIAL STATEMENTS HAVE BEEN DELIVERED PURSUANT TO SECTION 6.1(A) OR (B), THE
BORROWER AND ITS SUBSIDIARIES WOULD HAVE A CONSOLIDATED LEVERAGE RATIO OF LESS
THAN OR EQUAL TO 2.50:1.00 AND A CONSOLIDATED INTEREST COVERAGE RATIO OF GREATER
THAN OR EQUAL TO 4.25:1.00 FOR SUCH PERIOD (AS DEMONSTRATED, IN THE CASE OF ANY
PERMITTED ACQUISITION THE AGGREGATE CONSIDERATION FOR WHICH EXCEEDS $10,000,000,
BY DELIVERY TO THE ADMINISTRATIVE AGENT OF A CERTIFICATE TO SUCH EFFECT SHOWING
SUCH CALCULATION IN REASONABLE DETAIL), (IV) NO DEFAULT OR UNMATURED DEFAULT
EXISTS AT THE TIME THEREOF OR WOULD RESULT THEREFROM, AND (V) SUCH ACQUISITION
HAS NOT BEEN OPPOSED, OR HAS BEEN APPROVED, PRIOR TO THE CONSUMMATION THEREOF,
BY A MAJORITY OF THE BOARD OF DIRECTORS OF THE ENTITY BEING ACQUIRED; AND

 

(H)                                 IN ADDITION TO INVESTMENTS OTHERWISE
EXPRESSLY PERMITTED BY THIS SECTION, ADDITIONAL INVESTMENTS BY THE BORROWER OR
ANY OF ITS SUBSIDIARIES IN AN AGGREGATE AMOUNT (VALUED AT COST) NOT TO EXCEED,
AT ANY TIME, $10,000,000 PLUS 10% OF THE CONSOLIDATED NET WORTH CALCULATED AS OF
THE END OF THE MOST RECENTLY COMPLETED FISCAL QUARTER FOR WHICH FINANCIAL
STATEMENTS HAVE BEEN DELIVERED PURSUANT TO SECTION 6.1(A) OR (B) OR, BEFORE THE
FIRST DELIVERY OF SUCH FINANCIAL STATEMENTS HEREUNDER, AS OF OCTOBER 4, 2003.

 

7.8                                 TRANSACTIONS WITH AFFILIATES.  ENTER INTO
ANY TRANSACTION, INCLUDING ANY PURCHASE, SALE, LEASE OR EXCHANGE OF PROPERTY,
THE RENDERING OF ANY SERVICE OR THE PAYMENT OF ANY MANAGEMENT, ADVISORY OR
SIMILAR FEES, WITH ANY AFFILIATE (OTHER THAN THE BORROWER OR ANY CONSOLIDATED
SUBSIDIARY GUARANTOR) UNLESS SUCH TRANSACTION IS UPON FAIR AND REASONABLE TERMS
NO LESS FAVORABLE TO THE BORROWER OR SUCH SUBSIDIARY, AS THE CASE MAY BE, THAN
IT WOULD OBTAIN IN A COMPARABLE ARM’S LENGTH TRANSACTION WITH A PERSON THAT IS
NOT AN AFFILIATE.

 

7.9                                 CHANGES IN FISCAL PERIODS.  FOR FINANCIAL
REPORTING PURPOSES, PERMIT THE FISCAL YEAR OF THE BORROWER TO END ON A DAY OTHER
THAN THE SATURDAY CLOSEST TO THE END OF THE CALENDAR YEAR, OR CHANGE THE
BORROWER’S METHOD OF DETERMINING FISCAL QUARTERS, EXCEPT THAT THE BORROWER MAY,
UPON WRITTEN NOTICE TO THE ADMINISTRATIVE AGENT, CHANGE THE FINANCIAL REPORTING
CONVENTION SPECIFIED ABOVE TO ANY OTHER FINANCIAL REPORTING CONVENTION
REASONABLY ACCEPTABLE TO THE ADMINISTRATIVE AGENT, IN WHICH CASE THE

 

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Borrower and the Administrative Agent will, and are hereby authorized by the
Lenders to, make any adjustments to this Agreement that are necessary in order
to reflect such change in financial reporting.

 

7.10                           NEGATIVE PLEDGE CLAUSES.  ENTER INTO OR SUFFER TO
EXIST OR BECOME EFFECTIVE ANY AGREEMENT THAT PROHIBITS OR LIMITS THE ABILITY OF
THE BORROWER OR ANY OF ITS SUBSIDIARIES TO CREATE, INCUR, ASSUME OR SUFFER TO
EXIST ANY LIEN UPON ANY OF ITS PROPERTY OR REVENUES, WHETHER NOW OWNED OR
HEREAFTER ACQUIRED, OTHER THAN (A) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS,
(B) ANY AGREEMENTS GOVERNING ANY PURCHASE MONEY LIENS OR CAPITAL LEASE
OBLIGATIONS OTHERWISE PERMITTED HEREBY (IN WHICH CASE, ANY PROHIBITION OR
LIMITATION SHALL ONLY BE EFFECTIVE AGAINST THE ASSETS FINANCED THEREBY) AND (C)
AGREEMENTS GOVERNING ANY INDEBTEDNESS INCURRED PURSUANT TO SECTION 7.2(E),
7.2(F) OR 7.2(H) THAT CONTAIN LIMITATIONS ON LIENS CUSTOMARY FOR SUCH
INCURRENCES; PROVIDED THAT IN NO EVENT SHALL ANY SUCH AGREEMENT AFFECT THE
CAPITAL STOCK OF ANY SUBSIDIARY.

 

7.11                           CLAUSES RESTRICTING SUBSIDIARY DISTRIBUTIONS. 
ENTER INTO OR SUFFER TO EXIST OR BECOME EFFECTIVE ANY CONSENSUAL ENCUMBRANCE OR
RESTRICTION ON THE ABILITY OF ANY SUBSIDIARY OF THE BORROWER TO (A) MAKE
RESTRICTED PAYMENTS IN RESPECT OF ANY CAPITAL STOCK OF SUCH SUBSIDIARY HELD BY,
OR PAY ANY INDEBTEDNESS OWED TO, THE BORROWER OR ANY OTHER SUBSIDIARY OF THE
BORROWER, (B) MAKE LOANS OR ADVANCES TO, OR OTHER INVESTMENTS IN, THE BORROWER
OR ANY OTHER SUBSIDIARY OF THE BORROWER OR (C) TRANSFER ANY OF ITS ASSETS TO THE
BORROWER OR ANY OTHER SUBSIDIARY OF THE BORROWER, EXCEPT FOR SUCH ENCUMBRANCES
OR RESTRICTIONS EXISTING UNDER OR BY REASON OF (I) ANY RESTRICTIONS EXISTING
UNDER THE LOAN DOCUMENTS AND (II) ANY RESTRICTIONS WITH RESPECT TO A SUBSIDIARY
IMPOSED PURSUANT TO AN AGREEMENT THAT HAS BEEN ENTERED INTO IN CONNECTION WITH
THE DISPOSITION OF ALL OR SUBSTANTIALLY ALL OF THE CAPITAL STOCK OR ASSETS OF
SUCH SUBSIDIARY.

 

7.12                           LINES OF BUSINESS.  ENTER INTO ANY BUSINESS,
EITHER DIRECTLY OR THROUGH ANY SUBSIDIARY, EXCEPT FOR THOSE BUSINESSES IN WHICH
THE BORROWER AND ITS SUBSIDIARIES ARE ENGAGED IN ON THE DATE OF THIS AGREEMENT
OR THAT ARE REASONABLY RELATED THERETO, INCLUDING, WITHOUT LIMITATION,
COLLECTIBLES, GIFTWARE AND DECORATIVE ACCESSORIES.

 

7.13                           CONTINGENT OBLIGATIONS.  CREATE, INCUR, ASSUME OR
SUFFER TO EXIST ANY CONTINGENT OBLIGATION EXCEPT:

 

(A)                                  GUARANTEES CREATED PURSUANT TO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS;

 

(B)                                 GUARANTEES MADE IN THE ORDINARY COURSE OF
ITS BUSINESS BY THE BORROWER OF THE OBLIGATIONS OF ANY OF ITS SUBSIDIARIES;
PROVIDED THOSE OBLIGATIONS ARE OTHERWISE PERMITTED UNDER THIS AGREEMENT;

 

(C)                                  CONTINGENT OBLIGATIONS DESCRIBED ON
SCHEDULE 7.13;

 

(D)                                 CONTINGENT OBLIGATIONS ARISING ON ACCOUNT OF
THE FACILITY LCS; AND

 

(E)                                  CONTINGENT OBLIGATIONS PERMITTED BY
SECTION 7.2.

 

7.14                           FOREIGN EXCHANGE AND RATE MANAGEMENT
TRANSACTIONS.  ENTER INTO ANY FOREIGN CURRENCY EXCHANGE CONTRACTS (OTHER THAN
FOREIGN CURRENCY EXCHANGE CONTRACTS ENTERED INTO FOR THE SOLE PURPOSE OF HEDGING
WITH RESPECT TO THE PURCHASE OR SALE BY THE BORROWER AND ITS SUBSIDIARIES OF
INVENTORY TO BE PURCHASED OR SOLD FOR PAYMENTS IN FOREIGN CURRENCIES IN THE
ORDINARY COURSE OF THEIR RESPECTIVE BUSINESSES); OR ENTER INTO ANY OTHER RATE
MANAGEMENT TRANSACTION OTHER THAN IN THE ORDINARY COURSE OF

 

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business to protect the Borrower and its Subsidiaries from interest rate and
currency fluctuations in respect of Indebtedness owed by them.

 

ARTICLE VIII

 

DEFAULTS

 

The occurrence of any one or more of the following events shall constitute a
Default:

 

(A)                                  THE BORROWER SHALL FAIL TO PAY ANY
PRINCIPAL OF ANY LOAN OR REIMBURSEMENT OBLIGATION WHEN DUE IN ACCORDANCE WITH
THE TERMS HEREOF; OR THE BORROWER SHALL FAIL TO PAY ANY INTEREST ON ANY LOAN OR
REIMBURSEMENT OBLIGATION, OR ANY OTHER AMOUNT PAYABLE HEREUNDER OR UNDER ANY
OTHER LOAN DOCUMENT, WITHIN FIVE DAYS AFTER ANY SUCH INTEREST OR OTHER AMOUNT
BECOMES DUE IN ACCORDANCE WITH THE TERMS HEREOF; OR

 

(B)                                 ANY REPRESENTATION OR WARRANTY MADE OR
DEEMED MADE BY ANY LOAN PARTY HEREIN OR IN ANY OTHER LOAN DOCUMENT OR THAT IS
CONTAINED IN ANY CERTIFICATE, DOCUMENT OR FINANCIAL OR OTHER STATEMENT FURNISHED
BY IT AT ANY TIME UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY SUCH OTHER
LOAN DOCUMENT SHALL PROVE TO HAVE BEEN INACCURATE IN ANY MATERIAL RESPECT ON OR
AS OF THE DATE MADE OR DEEMED MADE; OR

 

(C)                                  ANY LOAN PARTY SHALL DEFAULT IN THE
OBSERVANCE OR PERFORMANCE OF ANY AGREEMENT CONTAINED IN CLAUSE (I) OR (II) OF
SECTION 6.4(A) (WITH RESPECT TO THE BORROWER ONLY), SECTION 6.7(A) OR SECTION 7
OF THIS AGREEMENT OR SECTIONS 5.3(A), 5.3(B) AND 5.6 OF THE GUARANTEE AND
COLLATERAL AGREEMENT; OR

 

(D)                                 ANY LOAN PARTY SHALL DEFAULT IN THE
OBSERVANCE OR PERFORMANCE OF ANY OTHER AGREEMENT CONTAINED IN THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT (OTHER THAN AS PROVIDED IN PARAGRAPHS (A) THROUGH (C) OF
THIS SECTION), AND SUCH DEFAULT SHALL CONTINUE UNREMEDIED FOR A PERIOD OF 30
DAYS; OR

 

(E)                                  THE BORROWER OR ANY OF ITS SUBSIDIARIES
SHALL (I) DEFAULT IN MAKING ANY PAYMENT OF ANY PRINCIPAL OF ANY INDEBTEDNESS
(INCLUDING ANY GUARANTEE OBLIGATION, BUT EXCLUDING THE LOANS) ON THE SCHEDULED
OR ORIGINAL DUE DATE WITH RESPECT THERETO OR WITHIN ANY APPLICABLE GRACE PERIOD;
OR (II) DEFAULT IN MAKING ANY PAYMENT OF ANY INTEREST ON ANY SUCH INDEBTEDNESS
BEYOND THE PERIOD OF GRACE, IF ANY, PROVIDED IN THE INSTRUMENT OR AGREEMENT
UNDER WHICH SUCH INDEBTEDNESS WAS CREATED; OR (III) DEFAULT IN THE OBSERVANCE OR
PERFORMANCE OF ANY OTHER AGREEMENT OR CONDITION RELATING TO ANY SUCH
INDEBTEDNESS OR CONTAINED IN ANY INSTRUMENT OR AGREEMENT EVIDENCING, SECURING OR
RELATING THERETO, OR ANY OTHER EVENT SHALL OCCUR OR CONDITION EXIST, THE EFFECT
OF WHICH DEFAULT OR OTHER EVENT OR CONDITION IS TO CAUSE, OR TO PERMIT THE
HOLDER OR BENEFICIARY OF SUCH INDEBTEDNESS (OR A TRUSTEE OR AGENT ON BEHALF OF
SUCH HOLDER OR BENEFICIARY) TO CAUSE, WITH THE GIVING OF NOTICE IF REQUIRED,
SUCH INDEBTEDNESS TO BECOME DUE PRIOR TO ITS STATED MATURITY OR (IN THE CASE OF
ANY SUCH INDEBTEDNESS CONSTITUTING A GUARANTEE OBLIGATION) TO BECOME PAYABLE;
PROVIDED, THAT A DEFAULT, EVENT OR CONDITION DESCRIBED IN CLAUSE (I), (II) OR
(III) OF THIS PARAGRAPH (E) SHALL NOT AT ANY TIME CONSTITUTE A DEFAULT UNLESS,
AT SUCH TIME, ONE OR MORE DEFAULTS, EVENTS OR CONDITIONS OF THE TYPE DESCRIBED
IN CLAUSES (I), (II) AND (III) OF THIS PARAGRAPH (E) SHALL HAVE OCCURRED AND BE
CONTINUING WITH RESPECT TO INDEBTEDNESS THE OUTSTANDING PRINCIPAL AMOUNT OF
WHICH EXCEEDS IN THE AGGREGATE $3,000,000; OR

 

(f)                                    (i) the Borrower or any of its Material
Subsidiaries shall commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic

 

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OR FOREIGN, RELATING TO BANKRUPTCY, INSOLVENCY, REORGANIZATION OR RELIEF OF
DEBTORS, SEEKING TO HAVE AN ORDER FOR RELIEF ENTERED WITH RESPECT TO IT, OR
SEEKING TO ADJUDICATE IT A BANKRUPT OR INSOLVENT, OR SEEKING REORGANIZATION,
ARRANGEMENT, ADJUSTMENT, WINDING-UP, LIQUIDATION, DISSOLUTION, COMPOSITION OR
OTHER RELIEF WITH RESPECT TO IT OR ITS DEBTS, OR (B) SEEKING APPOINTMENT OF A
RECEIVER, TRUSTEE, CUSTODIAN, CONSERVATOR OR OTHER SIMILAR OFFICIAL FOR IT OR
FOR ALL OR ANY SUBSTANTIAL PART OF ITS ASSETS, OR THE BORROWER OR ANY OF ITS
MATERIAL SUBSIDIARIES SHALL MAKE A GENERAL ASSIGNMENT FOR THE BENEFIT OF ITS
CREDITORS; OR (II) THERE SHALL BE COMMENCED AGAINST THE BORROWER OR ANY OF ITS
MATERIAL SUBSIDIARIES ANY CASE, PROCEEDING OR OTHER ACTION OF A NATURE REFERRED
TO IN CLAUSE (I) ABOVE THAT (A) RESULTS IN THE ENTRY OF AN ORDER FOR RELIEF OR
ANY SUCH ADJUDICATION OR APPOINTMENT OR (B) REMAINS UNDISMISSED, UNDISCHARGED OR
UNBONDED FOR A PERIOD OF 60 DAYS; OR (III) THERE SHALL BE COMMENCED AGAINST THE
BORROWER OR ANY OF ITS MATERIAL SUBSIDIARIES ANY CASE, PROCEEDING OR OTHER
ACTION SEEKING ISSUANCE OF A WARRANT OF ATTACHMENT, EXECUTION, DISTRAINT OR
SIMILAR PROCESS AGAINST ALL OR ANY SUBSTANTIAL PART OF ITS ASSETS THAT RESULTS
IN THE ENTRY OF AN ORDER FOR ANY SUCH RELIEF THAT SHALL NOT HAVE BEEN VACATED,
DISCHARGED, OR STAYED OR BONDED PENDING APPEAL WITHIN 60 DAYS FROM THE ENTRY
THEREOF; OR (IV) THE BORROWER OR ANY OF ITS SUBSIDIARIES SHALL TAKE ANY ACTION
IN FURTHERANCE OF, OR INDICATING ITS CONSENT TO, APPROVAL OF, OR ACQUIESCENCE
IN, ANY OF THE ACTS SET FORTH IN CLAUSE (I), (II), OR (III) ABOVE; OR (V) THE
BORROWER OR ANY OF ITS MATERIAL SUBSIDIARIES SHALL GENERALLY NOT, OR SHALL BE
UNABLE TO, OR SHALL ADMIT IN WRITING ITS INABILITY TO, PAY ITS DEBTS AS THEY
BECOME DUE; OR

 

(G)           (I) ANY PERSON SHALL ENGAGE IN ANY “PROHIBITED TRANSACTION” (AS
DEFINED IN SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE) INVOLVING ANY PLAN,
(II) ANY “ACCUMULATED FUNDING DEFICIENCY” (AS DEFINED IN SECTION 302 OF ERISA),
WHETHER OR NOT WAIVED, SHALL EXIST WITH RESPECT TO ANY SINGLE EMPLOYER PLAN OR
ANY LIEN IN FAVOR OF THE PBGC OR A SINGLE EMPLOYER PLAN SHALL ARISE ON THE
ASSETS OF THE BORROWER OR ANY COMMONLY CONTROLLED ENTITY, (III) A REPORTABLE
EVENT SHALL OCCUR WITH RESPECT TO, OR THE PBGC SHALL COMMENCE PROCEEDINGS TO
HAVE A TRUSTEE APPOINTED, OR A TRUSTEE SHALL BE APPOINTED, TO ADMINISTER OR TO
TERMINATE, ANY SINGLE EMPLOYER PLAN, WHICH REPORTABLE EVENT OR COMMENCEMENT OF
PROCEEDINGS OR APPOINTMENT OF A TRUSTEE IS REASONABLY LIKELY TO RESULT IN THE
TERMINATION OF SUCH PLAN FOR PURPOSES OF TITLE IV OF ERISA, (IV) ANY SINGLE
EMPLOYER PLAN SHALL TERMINATE FOR PURPOSES OF TITLE IV OF ERISA, (V) THE
BORROWER OR ANY COMMONLY CONTROLLED ENTITY SHALL OR IS REASONABLY LIKELY TO,
INCUR ANY LIABILITY IN CONNECTION WITH A WITHDRAWAL FROM, OR THE INSOLVENCY OR
REORGANIZATION OF, A MULTIEMPLOYER PLAN OR (VI) ANY OTHER SIMILAR EVENT OR
CONDITION SHALL OCCUR OR EXIST WITH RESPECT TO A PLAN OTHER THAN IN THE ORDINARY
COURSE; AND IN EACH CASE IN CLAUSES (I) THROUGH (VI) ABOVE, SUCH EVENT OR
CONDITION, TOGETHER WITH ALL OTHER SUCH EVENTS OR CONDITIONS, IF ANY, COULD, IN
THE REASONABLE JUDGMENT OF THE REQUIRED LENDERS, BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT; OR

 

(H)           ONE OR MORE JUDGMENTS OR DECREES SHALL BE ENTERED AGAINST THE
BORROWER OR ANY OF ITS SUBSIDIARIES INVOLVING IN THE AGGREGATE A LIABILITY (NOT
PAID OR FULLY COVERED BY INSURANCE AS TO WHICH THE RELEVANT INSURANCE COMPANY
HAS ACKNOWLEDGED COVERAGE) OF $3,000,000 OR MORE, AND ANY OR ALL SUCH JUDGMENTS
OR DECREES SHALL NOT HAVE BEEN VACATED, DISCHARGED, STAYED OR BONDED PENDING
APPEAL WITHIN 60 DAYS FROM THE ENTRY THEREOF; OR

 

(I)            ANY OF THE COLLATERAL DOCUMENTS SHALL CEASE, FOR ANY REASON, TO
BE IN FULL FORCE AND EFFECT, OR ANY LOAN PARTY OR ANY AFFILIATE OF ANY LOAN
PARTY SHALL SO ASSERT, OR ANY LIEN CREATED BY ANY OF THE COLLATERAL DOCUMENTS
SHALL CEASE TO BE ENFORCEABLE AND OF THE SAME EFFECT AND PRIORITY PURPORTED TO
BE CREATED THEREBY; OR

 

(J)            THE GUARANTEE CONTAINED IN SECTION 2 OF THE GUARANTEE AND
COLLATERAL AGREEMENT SHALL CEASE, FOR ANY REASON, TO BE IN FULL FORCE AND EFFECT
OR ANY LOAN PARTY SHALL SO ASSERT; OR

 

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(K)           (I)  ANY “PERSON” OR “GROUP” (AS SUCH TERMS ARE USED IN
SECTIONS 13(D) AND 14(D) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE
“EXCHANGE ACT”)), SHALL BECOME, OR OBTAIN RIGHTS (WHETHER BY MEANS OR WARRANTS,
OPTIONS OR OTHERWISE) TO BECOME, THE “BENEFICIAL OWNER” (AS DEFINED IN RULES
13(D)-3 AND 13(D)-5 UNDER THE EXCHANGE ACT), DIRECTLY OR INDIRECTLY, OF MORE
THAN 30% OF THE OUTSTANDING COMMON STOCK OF THE BORROWER; (II) THE BOARD OF
DIRECTORS OF THE BORROWER SHALL CEASE TO CONSIST OF A MAJORITY OF CONTINUING
DIRECTORS; (III) THE BORROWER SHALL CEASE TO OWN AND CONTROL, OF RECORD AND
BENEFICIALLY, DIRECTLY OR INDIRECTLY, 100% OF EACH CLASS OF OUTSTANDING CAPITAL
STOCK OF D56, INC. FREE AND CLEAR OF ALL LIENS (EXCEPT LIENS CREATED BY THE
COLLATERAL DOCUMENTS).

 

ARTICLE IX

ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES

 

9.1           ACCELERATION; FACILITY LC COLLATERAL ACCOUNT.

 

(A)           IF A DEFAULT DESCRIBED IN SECTION 8(F) OCCURS WITH RESPECT TO THE
BORROWER, THE OBLIGATIONS OF THE LENDERS TO MAKE LOANS HEREUNDER AND THE
OBLIGATION AND POWER OF THE LC ISSUER TO ISSUE FACILITY LCS SHALL AUTOMATICALLY
TERMINATE AND THE OBLIGATIONS SHALL IMMEDIATELY BECOME DUE AND PAYABLE WITHOUT
ANY ELECTION OR ACTION ON THE PART OF THE ADMINISTRATIVE AGENT, THE LC ISSUER OR
ANY LENDER AND THE BORROWER WILL BE AND BECOME THEREBY UNCONDITIONALLY
OBLIGATED, WITHOUT ANY FURTHER NOTICE, ACT OR DEMAND, TO PAY TO THE
ADMINISTRATIVE AGENT AN AMOUNT IN IMMEDIATELY AVAILABLE FUNDS, WHICH FUNDS SHALL
BE HELD IN THE FACILITY LC COLLATERAL ACCOUNT, EQUAL TO THE DIFFERENCE OF (X)
THE AMOUNT OF LC OBLIGATIONS AT SUCH TIME, LESS (Y) THE AMOUNT ON DEPOSIT IN THE
FACILITY LC COLLATERAL ACCOUNT AT SUCH TIME WHICH IS FREE AND CLEAR OF ALL
RIGHTS AND CLAIMS OF THIRD PARTIES AND HAS NOT BEEN APPLIED AGAINST THE
OBLIGATIONS (SUCH DIFFERENCE, THE “COLLATERAL SHORTFALL AMOUNT”).  IF ANY OTHER
DEFAULT OCCURS, THE REQUIRED LENDERS (OR THE ADMINISTRATIVE AGENT WITH THE
CONSENT OF THE REQUIRED LENDERS) MAY (I) TERMINATE OR SUSPEND THE OBLIGATIONS OF
THE LENDERS TO MAKE LOANS HEREUNDER AND THE OBLIGATION AND POWER OF THE LC
ISSUER TO ISSUE FACILITY LCS, OR DECLARE THE OBLIGATIONS TO BE DUE AND PAYABLE,
OR BOTH, WHEREUPON THE OBLIGATIONS SHALL BECOME IMMEDIATELY DUE AND PAYABLE,
WITHOUT PRESENTMENT, DEMAND, PROTEST OR NOTICE OF ANY KIND, ALL OF WHICH THE
BORROWER HEREBY EXPRESSLY WAIVES, AND (II) UPON NOTICE TO THE BORROWER AND IN
ADDITION TO THE CONTINUING RIGHT TO DEMAND PAYMENT OF ALL AMOUNTS PAYABLE UNDER
THIS AGREEMENT, MAKE DEMAND ON THE BORROWER TO PAY, AND THE BORROWER WILL,
FORTHWITH UPON SUCH DEMAND AND WITHOUT ANY FURTHER NOTICE OR ACT, PAY TO THE
ADMINISTRATIVE AGENT THE COLLATERAL SHORTFALL AMOUNT, WHICH FUNDS SHALL BE
DEPOSITED IN THE FACILITY LC COLLATERAL ACCOUNT.

 

(B)           IF AT ANY TIME WHILE ANY DEFAULT IS CONTINUING, THE ADMINISTRATIVE
AGENT REASONABLY DETERMINES THAT THE COLLATERAL SHORTFALL AMOUNT AT SUCH TIME IS
GREATER THAN ZERO, THE ADMINISTRATIVE AGENT MAY MAKE DEMAND ON THE BORROWER TO
PAY, AND THE BORROWER WILL, FORTHWITH UPON SUCH DEMAND AND WITHOUT ANY FURTHER
NOTICE OR ACT, PAY TO THE ADMINISTRATIVE AGENT THE COLLATERAL SHORTFALL AMOUNT,
WHICH FUNDS SHALL BE DEPOSITED IN THE FACILITY LC COLLATERAL ACCOUNT.

 

(C)           AT ANY TIME WHILE ANY DEFAULT IS CONTINUING, THE ADMINISTRATIVE
AGENT MAY AT ANY TIME OR FROM TIME TO TIME AFTER FUNDS ARE DEPOSITED IN THE
FACILITY LC COLLATERAL ACCOUNT, APPLY SUCH FUNDS TO THE PAYMENT OF THE
OBLIGATIONS AND ANY OTHER AMOUNTS AS SHALL FROM TIME TO TIME HAVE BECOME DUE AND
PAYABLE BY THE BORROWER TO THE LENDERS OR THE LC ISSUER UNDER THE LOAN
DOCUMENTS.

 

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(D)           AT ANY TIME WHILE ANY DEFAULT IS CONTINUING, NEITHER THE BORROWER
NOR ANY PERSON CLAIMING ON BEHALF OF OR THROUGH THE BORROWER SHALL HAVE ANY
RIGHT TO WITHDRAW ANY OF THE FUNDS HELD IN THE FACILITY LC COLLATERAL ACCOUNT. 
AFTER ALL OF THE OBLIGATIONS HAVE BEEN INDEFEASIBLY PAID IN FULL AND THE
AGGREGATE COMMITMENT HAS BEEN TERMINATED, ANY FUNDS REMAINING IN THE FACILITY LC
COLLATERAL ACCOUNT SHALL BE RETURNED BY THE ADMINISTRATIVE AGENT TO THE BORROWER
OR PAID TO WHOMEVER MAY BE LEGALLY ENTITLED THERETO AT SUCH TIME.

 

(E)           IF, WITHIN 30 DAYS AFTER ACCELERATION OF THE MATURITY OF THE
OBLIGATIONS OR TERMINATION OF THE OBLIGATIONS OF THE LENDERS TO MAKE LOANS AND
THE OBLIGATION AND POWER OF THE LC ISSUER TO ISSUE FACILITY LCS HEREUNDER AS A
RESULT OF ANY DEFAULT (OTHER THAN ANY DEFAULT AS DESCRIBED IN SECTION 8(F) WITH
RESPECT TO THE BORROWER) AND BEFORE ANY JUDGMENT OR DECREE FOR THE PAYMENT OF
THE OBLIGATIONS DUE SHALL HAVE BEEN OBTAINED OR ENTERED, THE REQUIRED LENDERS
(IN THEIR SOLE DISCRETION) SHALL SO DIRECT, THE ADMINISTRATIVE AGENT SHALL, BY
NOTICE TO THE BORROWER, RESCIND AND ANNUL SUCH ACCELERATION AND/OR TERMINATION.

 

9.2           AMENDMENTS.  SUBJECT TO THE PROVISIONS OF THIS SECTION 9.2, THE
REQUIRED LENDERS (OR THE ADMINISTRATIVE AGENT WITH THE CONSENT IN WRITING OF THE
REQUIRED LENDERS) AND THE LOAN PARTIES PARTY TO THE APPLICABLE LOAN DOCUMENT MAY
ENTER INTO AGREEMENTS SUPPLEMENTAL HERETO FOR THE PURPOSE OF ADDING OR MODIFYING
ANY PROVISIONS TO SUCH LOAN DOCUMENTS OR CHANGING IN ANY MANNER THE RIGHTS OF
THE LENDERS OR SUCH LOAN PARTIES UNDER THE APPLICABLE LOAN DOCUMENT OR WAIVING
ANY DEFAULT HEREUNDER; PROVIDED, HOWEVER, THAT NO SUCH SUPPLEMENTAL AGREEMENT
SHALL, WITHOUT THE CONSENT OF ALL OF THE LENDERS:

 

(A)           EXTEND THE FINAL MATURITY OF ANY LOAN, EXTEND THE EXPIRY DATE OF
ANY FACILITY LC TO A DATE AFTER THE FACILITY TERMINATION DATE, POSTPONE ANY
REGULARLY SCHEDULED PAYMENT OF PRINCIPAL OF ANY LOAN OR FORGIVE ALL OR ANY
PORTION OF THE PRINCIPAL AMOUNT THEREOF OR ANY REIMBURSEMENT OBLIGATION RELATED
THERETO, OR REDUCE THE RATE OR EXTEND THE TIME OF PAYMENT OF INTEREST OR FEES
THEREON OR REIMBURSEMENT OBLIGATIONS RELATED THERETO.

 

(B)           REDUCE THE PERCENTAGE SPECIFIED IN THE DEFINITION OF REQUIRED
LENDERS.

 

(C)           EXTEND THE FACILITY TERMINATION DATE, OR REDUCE THE AMOUNT OR
EXTEND THE PAYMENT DATE FOR, THE MANDATORY PAYMENTS REQUIRED UNDER
SECTION 2.2.1(B)(II) OR SECTION 2.2.2, OR EXCEPT AS CONTEMPLATED BY
SECTION 2.6.3, INCREASE THE AMOUNT OF THE COMMITMENT OF ANY LENDER HEREUNDER OR
THE COMMITMENT TO ISSUE FACILITY LCS, OR PERMIT THE BORROWER TO ASSIGN ITS
RIGHTS UNDER THIS AGREEMENT.

 

(D)           AMEND THIS SECTION 9.2.

 

(E)           RELEASE ANY SUBSIDIARY GUARANTOR THAT IS A MATERIAL SUBSIDIARY OR,
EXCEPT AS PROVIDED IN THE COLLATERAL DOCUMENTS, RELEASE ALL OR SUBSTANTIALLY ALL
OF THE COLLATERAL.

 

Any Default which is waived by the Lenders in accordance with this Section 9.2
shall be deemed to be no longer continuing.  No amendment of any provision of
this Agreement relating to the Administrative Agent shall be effective without
the written consent of the Administrative Agent, and no amendment of any
provision relating to the LC Issuer shall be effective without the written
consent of the LC Issuer.  No amendment of any provision of this Agreement
relating to the Swing Line Lender or any Swing Line Loans shall be effective
without the written consent of the Swing Line Lender.  The Administrative Agent
may waive payment of the fee required under Section 13.3.3 without obtaining the
consent of any other party to this Agreement.  Notwithstanding the foregoing,
upon the execution and delivery of all documentation required by Section 2.6.3
to be delivered in connection with an increase to the Aggregate Commitment, the
Administrative Agent, the Borrower and the new or existing Lenders whose

 

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Commitments have been affected may and shall enter into an amendment hereof
(which shall be binding on all parties hereto) solely for the purpose of
reflecting any new Lenders and their new Commitments and any increase in the
Commitment of any existing Lender.

 

9.3           PRESERVATION OF RIGHTS.  NO DELAY OR OMISSION OF THE LENDERS, THE
LC ISSUER OR THE ADMINISTRATIVE AGENT TO EXERCISE ANY RIGHT UNDER THE LOAN
DOCUMENTS SHALL IMPAIR SUCH RIGHT OR BE CONSTRUED TO BE A WAIVER OF ANY DEFAULT
OR AN ACQUIESCENCE THEREIN, AND THE MAKING OF A CREDIT EXTENSION NOTWITHSTANDING
THE EXISTENCE OF A DEFAULT OR THE INABILITY OF THE BORROWER TO SATISFY THE
CONDITIONS PRECEDENT TO SUCH CREDIT EXTENSION SHALL NOT CONSTITUTE ANY WAIVER OR
ACQUIESCENCE.  ANY SINGLE OR PARTIAL EXERCISE OF ANY SUCH RIGHT SHALL NOT
PRECLUDE OTHER OR FURTHER EXERCISE THEREOF OR THE EXERCISE OF ANY OTHER RIGHT,
AND NO WAIVER, AMENDMENT OR OTHER VARIATION OF THE TERMS, CONDITIONS OR
PROVISIONS OF THE LOAN DOCUMENTS WHATSOEVER SHALL BE VALID UNLESS IN WRITING
SIGNED BY THE LENDERS REQUIRED PURSUANT TO SECTION 9.2, AND THEN ONLY TO THE
EXTENT IN SUCH WRITING SPECIFICALLY SET FORTH.  ALL REMEDIES CONTAINED IN THE
LOAN DOCUMENTS OR BY LAW AFFORDED SHALL BE CUMULATIVE AND ALL SHALL BE AVAILABLE
TO THE ADMINISTRATIVE AGENT, THE LC ISSUER AND THE LENDERS UNTIL THE OBLIGATIONS
HAVE BEEN PAID IN FULL.

 

ARTICLE X

 

GENERAL PROVISIONS

 

10.1         SURVIVAL OF REPRESENTATIONS.  ALL REPRESENTATIONS AND WARRANTIES OF
THE BORROWER CONTAINED IN THIS AGREEMENT SHALL SURVIVE THE MAKING OF THE CREDIT
EXTENSIONS HEREIN CONTEMPLATED.

 

10.2         GOVERNMENTAL REGULATION.  ANYTHING CONTAINED IN THIS AGREEMENT TO
THE CONTRARY NOTWITHSTANDING, NEITHER THE LC ISSUER NOR ANY LENDER SHALL BE
OBLIGATED TO EXTEND CREDIT TO THE BORROWER IN VIOLATION OF ANY LIMITATION OR
PROHIBITION PROVIDED BY ANY APPLICABLE STATUTE OR REGULATION.

 

10.3         HEADINGS.  SECTION HEADINGS IN THE LOAN DOCUMENTS ARE FOR
CONVENIENCE OF REFERENCE ONLY, AND SHALL NOT GOVERN THE INTERPRETATION OF ANY OF
THE PROVISIONS OF THE LOAN DOCUMENTS.

 

10.4         ENTIRE AGREEMENT.  THE LOAN DOCUMENTS EMBODY THE ENTIRE AGREEMENT
AND UNDERSTANDING AMONG THE BORROWER, THE ADMINISTRATIVE AGENT, THE LC ISSUER
AND THE LENDERS AND SUPERSEDE ALL PRIOR AGREEMENTS AND UNDERSTANDINGS AMONG THE
BORROWER, THE ADMINISTRATIVE AGENT, THE LC ISSUER AND THE LENDERS RELATING TO
THE SUBJECT MATTER THEREOF OTHER THAN THOSE CONTAINED IN THE FEE LETTER
DESCRIBED IN SECTION 11.13 WHICH SHALL SURVIVE AND REMAIN IN FULL FORCE AND
EFFECT UNTIL ALL OF THE OBLIGATIONS HAVE BEEN INDEFEASIBLY PAID IN FULL AND THE
AGGREGATE COMMITMENT HAS BEEN TERMINATED.

 

10.5         SEVERAL OBLIGATIONS; BENEFITS OF THIS AGREEMENT.  THE RESPECTIVE
OBLIGATIONS OF THE LENDERS HEREUNDER ARE SEVERAL AND NOT JOINT AND NO LENDER
SHALL BE THE PARTNER OR AGENT OF ANY OTHER (EXCEPT TO THE EXTENT TO WHICH THE
ADMINISTRATIVE AGENT IS AUTHORIZED TO ACT AS SUCH).  THE FAILURE OF ANY LENDER
TO PERFORM ANY OF ITS OBLIGATIONS HEREUNDER SHALL NOT RELIEVE ANY OTHER LENDER
FROM ANY OF ITS OBLIGATIONS HEREUNDER.  THIS AGREEMENT SHALL NOT BE CONSTRUED SO
AS TO CONFER ANY RIGHT OR BENEFIT UPON ANY PERSON OTHER THAN THE PARTIES TO THIS
AGREEMENT AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS; PROVIDED, HOWEVER, THAT
THE PARTIES HERETO EXPRESSLY AGREE THAT THE ARRANGER SHALL ENJOY THE BENEFITS OF
THE PROVISIONS OF SECTIONS 10.6, 10.10 AND 11.11 TO THE EXTENT SPECIFICALLY SET
FORTH THEREIN AND SHALL HAVE THE RIGHT TO ENFORCE SUCH PROVISIONS ON ITS OWN
BEHALF AND IN ITS OWN NAME TO THE SAME EXTENT AS IF IT WERE A PARTY TO THIS
AGREEMENT.

 

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10.6         EXPENSES; INDEMNIFICATION.

 

(A)           THE BORROWER SHALL REIMBURSE THE ADMINISTRATIVE AGENT AND THE
ARRANGER FOR ANY REASONABLE AND DOCUMENTED OUT-OF-POCKET EXPENSES (INCLUDING
ATTORNEYS’ FEES AND TIME CHARGES OF ATTORNEYS FOR THE ADMINISTRATIVE AGENT,
WHICH ATTORNEYS MAY BE EMPLOYEES OF THE ADMINISTRATIVE AGENT) PAID OR INCURRED
BY THE ADMINISTRATIVE AGENT OR THE ARRANGER IN CONNECTION WITH THE PREPARATION,
NEGOTIATION, EXECUTION, DELIVERY, SYNDICATION, DISTRIBUTION (INCLUDING, WITHOUT
LIMITATION, VIA THE INTERNET), REVIEW, AMENDMENT, MODIFICATION, AND
ADMINISTRATION OF THE LOAN DOCUMENTS; PROVIDED THAT SUCH OUT-OF-POCKET EXPENSES
INCURRED IN CONNECTION WITH THE CLOSING OF THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT SHALL NOT EXCEED $100,000 IN THE AGGREGATE.  THE BORROWER ALSO AGREES
TO REIMBURSE THE ADMINISTRATIVE AGENT, THE ARRANGER, THE LC ISSUER AND THE
LENDERS FOR ANY REASONABLE AND DOCUMENTED OUT-OF-POCKET EXPENSES (INCLUDING
ATTORNEYS’ FEES AND TIME CHARGES OF ATTORNEYS FOR THE ADMINISTRATIVE AGENT, THE
ARRANGER, THE LC ISSUER AND THE LENDERS, WHICH ATTORNEYS MAY BE EMPLOYEES OF THE
ADMINISTRATIVE AGENT, THE ARRANGER, THE LC ISSUER OR THE LENDERS) PAID OR
INCURRED BY THE ADMINISTRATIVE AGENT, THE ARRANGER, THE LC ISSUER OR ANY LENDER
IN CONNECTION WITH THE COLLECTION AND ENFORCEMENT OF THE LOAN DOCUMENTS. 
EXPENSES BEING REIMBURSED BY THE BORROWER UNDER THIS SECTION INCLUDE, WITHOUT
LIMITATION, REASONABLE AND DOCUMENTED OUT-OF-POCKET EXPENSES INCURRED IN
CONNECTION WITH THE REPORTS DESCRIBED IN THE FOLLOWING SENTENCE.  THE BORROWER
ACKNOWLEDGES THAT FROM TIME TO TIME BANK ONE MAY PREPARE AND MAY DISTRIBUTE TO
THE LENDERS (BUT SHALL HAVE NO OBLIGATION OR DUTY TO PREPARE OR TO DISTRIBUTE TO
THE LENDERS) CERTAIN AUDIT REPORTS (THE “REPORTS”) PERTAINING TO THE BORROWER’S
ASSETS FOR INTERNAL USE BY BANK ONE FROM INFORMATION FURNISHED TO IT BY OR ON
BEHALF OF THE BORROWER, AFTER BANK ONE HAS EXERCISED ITS RIGHTS OF INSPECTION
PURSUANT TO THIS AGREEMENT.

 

(B)           THE BORROWER HEREBY FURTHER AGREES TO INDEMNIFY THE ADMINISTRATIVE
AGENT, THE ARRANGER, THE LC ISSUER AND EACH LENDER, THEIR RESPECTIVE AFFILIATES,
AND EACH OF THEIR DIRECTORS, OFFICERS AND EMPLOYEES AGAINST ALL LOSSES, CLAIMS,
DAMAGES, PENALTIES, JUDGMENTS, LIABILITIES AND EXPENSES (INCLUDING, WITHOUT
LIMITATION, ALL EXPENSES OF LITIGATION OR PREPARATION THEREFOR WHETHER OR NOT
THE ADMINISTRATIVE AGENT, THE ARRANGER, THE LC ISSUER OR ANY LENDER OR ANY
AFFILIATE IS A PARTY THERETO) WHICH ANY OF THEM MAY PAY OR INCUR ARISING OUT OF
OR RELATING TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, THE TRANSACTIONS
CONTEMPLATED HEREBY OR THE DIRECT OR INDIRECT APPLICATION OF THE PROCEEDS OF ANY
CREDIT EXTENSION HEREUNDER EXCEPT TO THE EXTENT THAT THEY ARE DETERMINED IN A
FINAL NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO HAVE
RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE PARTY SEEKING
INDEMNIFICATION.  THE OBLIGATIONS OF THE BORROWER UNDER THIS SECTION 10.6 SHALL
SURVIVE THE TERMINATION OF THIS AGREEMENT.

 

10.7         NUMBERS OF DOCUMENTS.  ALL STATEMENTS, NOTICES, CLOSING DOCUMENTS,
AND REQUESTS HEREUNDER SHALL BE FURNISHED TO THE ADMINISTRATIVE AGENT WITH
SUFFICIENT COUNTERPARTS SO THAT THE ADMINISTRATIVE AGENT MAY FURNISH ONE TO THE
LC ISSUER AND EACH OF THE LENDERS.

 

10.8         ACCOUNTING.  EXCEPT AS PROVIDED TO THE CONTRARY HEREIN, ALL
ACCOUNTING TERMS USED HEREIN SHALL BE INTERPRETED AND ALL ACCOUNTING
DETERMINATIONS HEREUNDER SHALL BE MADE IN ACCORDANCE WITH GAAP IN A MANNER
CONSISTENT WITH THAT USED IN PREPARING THE FINANCIAL STATEMENTS REFERRED TO IN
SECTION 5.1, EXCEPT THAT ANY CALCULATION OR DETERMINATION WHICH IS TO BE MADE ON
A CONSOLIDATED BASIS SHALL BE MADE FOR THE BORROWER AND ALL OF ITS SUBSIDIARIES,
INCLUDING THOSE SUBSIDIARIES, IF ANY, WHICH ARE UNCONSOLIDATED ON THE BORROWER’S
AUDITED FINANCIAL STATEMENTS.  IF AT ANY TIME ANY CHANGE IN GAAP WOULD AFFECT
THE COMPUTATION OF ANY FINANCIAL RATIO OR REQUIREMENT SET FORTH IN ANY LOAN
DOCUMENT, AND THE BORROWER, THE ADMINISTRATIVE AGENT OR THE REQUIRED LENDERS
SHALL SO REQUEST, THE ADMINISTRATIVE AGENT, THE LENDERS AND THE LOAN PARTIES
SHALL NEGOTIATE IN GOOD FAITH TO AMEND SUCH RATIO OR REQUIREMENT TO PRESERVE THE

 

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ORIGINAL INTENT THEREOF IN LIGHT OF SUCH CHANGE IN GAAP (SUBJECT TO THE APPROVAL
OF THE REQUIRED LENDERS); PROVIDED THAT UNTIL SO AMENDED, SUCH RATIO OR
REQUIREMENT SHALL CONTINUE TO BE COMPUTED IN ACCORDANCE WITH GAAP PRIOR TO SUCH
CHANGE THEREIN AND THE BORROWER SHALL PROVIDE TO THE ADMINISTRATIVE AGENT AND
THE LENDERS RECONCILIATION STATEMENTS SHOWING THE DIFFERENCE IN SUCH
CALCULATION, TOGETHER WITH THE DELIVERY OF MONTHLY, QUARTERLY AND ANNUAL
FINANCIAL STATEMENTS REQUIRED HEREUNDER.

 

10.9         SEVERABILITY OF PROVISIONS.  ANY PROVISION IN ANY LOAN DOCUMENT
THAT IS HELD TO BE INOPERATIVE, UNENFORCEABLE, OR INVALID IN ANY JURISDICTION
SHALL, AS TO THAT JURISDICTION, BE INOPERATIVE, UNENFORCEABLE, OR INVALID
WITHOUT AFFECTING THE REMAINING PROVISIONS IN THAT JURISDICTION OR THE
OPERATION, ENFORCEABILITY, OR VALIDITY OF THAT PROVISION IN ANY OTHER
JURISDICTION, AND TO THIS END THE PROVISIONS OF ALL LOAN DOCUMENTS ARE DECLARED
TO BE SEVERABLE.

 

10.10       NONLIABILITY OF LENDERS.  THE RELATIONSHIP BETWEEN THE BORROWER ON
THE ONE HAND AND THE LENDERS, THE LC ISSUER AND THE ADMINISTRATIVE AGENT ON THE
OTHER HAND SHALL BE SOLELY THAT OF BORROWER AND LENDER.  NEITHER THE
ADMINISTRATIVE AGENT, THE ARRANGER, THE LC ISSUER NOR ANY LENDER SHALL HAVE ANY
FIDUCIARY RESPONSIBILITIES TO THE BORROWER.  NEITHER THE ADMINISTRATIVE AGENT,
THE ARRANGER, THE LC ISSUER NOR ANY LENDER UNDERTAKES ANY RESPONSIBILITY TO THE
BORROWER TO REVIEW OR INFORM THE BORROWER OF ANY MATTER IN CONNECTION WITH ANY
PHASE OF THE BORROWER’S BUSINESS OR OPERATIONS.  THE BORROWER AGREES THAT
NEITHER THE ADMINISTRATIVE AGENT, THE ARRANGER, THE LC ISSUER NOR ANY LENDER
SHALL HAVE LIABILITY TO THE BORROWER (WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE) FOR LOSSES SUFFERED BY THE BORROWER IN CONNECTION WITH, ARISING OUT
OF, OR IN ANY WAY RELATED TO, THE TRANSACTIONS CONTEMPLATED AND THE RELATIONSHIP
ESTABLISHED BY THE LOAN DOCUMENTS, OR ANY ACT, OMISSION OR EVENT OCCURRING IN
CONNECTION THEREWITH, UNLESS IT IS DETERMINED IN A FINAL NON-APPEALABLE JUDGMENT
BY A COURT OF COMPETENT JURISDICTION THAT SUCH LOSSES RESULTED FROM THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF THE PARTY FROM WHICH RECOVERY IS SOUGHT. 
NEITHER THE ADMINISTRATIVE AGENT, THE ARRANGER, THE LC ISSUER NOR ANY LENDER
SHALL HAVE ANY LIABILITY WITH RESPECT TO, AND THE BORROWER HEREBY WAIVES,
RELEASES AND AGREES NOT TO SUE FOR, ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR
PUNITIVE DAMAGES SUFFERED BY THE BORROWER IN CONNECTION WITH, ARISING OUT OF, OR
IN ANY WAY RELATED TO THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
THEREBY.

 

10.11       CONFIDENTIALITY.  THE ADMINISTRATIVE AGENT AND EACH LENDER AGREES TO
HOLD ANY CONFIDENTIAL INFORMATION WHICH IT MAY RECEIVE OR HAS RECEIVED FROM THE
BORROWER OR ANY OF ITS SUBSIDIARIES IN CONNECTION WITH THIS AGREEMENT IN
CONFIDENCE, EXCEPT FOR DISCLOSURE (I) TO ITS AFFILIATES AND TO THE
ADMINISTRATIVE AGENT AND ANY OTHER LENDER AND, TO THE EXTENT IN CONNECTION WITH
THE TRANSACTIONS CONTEMPLATED HEREBY AND ON A CONFIDENTIAL BASIS, THEIR
RESPECTIVE AFFILIATES, (II) TO LEGAL COUNSEL, ACCOUNTANTS, AND OTHER
PROFESSIONAL ADVISORS TO SUCH LENDER OR TO A TRANSFEREE, (III) TO REGULATORY
OFFICIALS UPON REQUEST OR DEMAND, (IV) TO ANY PERSON AS REQUESTED PURSUANT TO OR
AS REQUIRED BY LAW, REGULATION, OR LEGAL PROCESS, (V) TO ANY PERSON IN
CONNECTION WITH ANY LEGAL PROCEEDING TO WHICH IT IS A PARTY, (VI) TO ITS DIRECT
OR INDIRECT CONTRACTUAL COUNTERPARTIES IN SWAP AGREEMENTS OR TO LEGAL COUNSEL,
ACCOUNTANTS AND OTHER PROFESSIONAL ADVISORS TO SUCH COUNTERPARTIES, (VII)
PERMITTED BY SECTION 13.4, AND (VIII) TO RATING AGENCIES IF REQUESTED OR
REQUIRED BY SUCH AGENCIES IN CONNECTION WITH A RATING RELATING TO THE ADVANCES
HEREUNDER.  WITHOUT LIMITING SECTION 10.4, THE BORROWER AGREES THAT THE TERMS OF
THIS SECTION 10.11 SHALL SET FORTH THE ENTIRE AGREEMENT BETWEEN THE BORROWER AND
EACH LENDER (INCLUDING THE ADMINISTRATIVE AGENT) WITH RESPECT TO ANY
CONFIDENTIAL INFORMATION PREVIOUSLY OR HEREAFTER RECEIVED BY SUCH LENDER IN
CONNECTION WITH THIS AGREEMENT, AND THIS SECTION 10.11 SHALL SUPERSEDE ANY AND
ALL PRIOR CONFIDENTIALITY AGREEMENTS ENTERED INTO BY SUCH LENDER WITH RESPECT TO
SUCH CONFIDENTIAL INFORMATION.  NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY,
CONFIDENTIAL INFORMATION SHALL NOT INCLUDE, AND EACH PARTY HERETO (AND EACH
EMPLOYEE, REPRESENTATIVE OR OTHER AGENT OF ANY PARTY HERETO) MAY DISCLOSE TO ANY
AND ALL PERSONS, WITHOUT LIMITATION OF ANY KIND, THE U.S. FEDERAL INCOME TAX
TREATMENT AND U.S. FEDERAL INCOME TAX STRUCTURE OF THE TRANSACTIONS CONTEMPLATED
HEREBY AND ALL MATERIALS OF ANY KIND (INCLUDING OPINIONS OR OTHER TAX ANALYSES)
THAT ARE OR HAVE BEEN PROVIDED TO SUCH PARTY RELATING TO SUCH TAX TREATMENT

 

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OR TAX STRUCTURE, AND IT IS HEREBY CONFIRMED THAT EACH PARTY HERETO HAS BEEN
AUTHORIZED TO MAKE SUCH DISCLOSURES SINCE THE COMMENCEMENT OF DISCUSSIONS
REGARDING THE TRANSACTIONS CONTEMPLATED HEREBY.

 

10.12       NONRELIANCE.  EACH LENDER HEREBY REPRESENTS THAT IT IS NOT RELYING
ON OR LOOKING TO ANY MARGIN STOCK (AS DEFINED IN REGULATION U OF THE BOARD OF
GOVERNORS OF THE FEDERAL RESERVE SYSTEM) FOR THE REPAYMENT OF THE CREDIT
EXTENSIONS PROVIDED FOR HEREIN.

 

10.13       DISCLOSURE.  THE BORROWER AND EACH LENDER HEREBY ACKNOWLEDGE AND
AGREE THAT BANK ONE AND/OR ITS AFFILIATES FROM TIME TO TIME MAY HOLD INVESTMENTS
IN, MAKE OTHER LOANS TO OR HAVE OTHER RELATIONSHIPS WITH THE BORROWER AND ITS
AFFILIATES.

 

10.14       USA PATRIOT ACT NOTIFICATION.  THE FOLLOWING NOTIFICATION IS
PROVIDED TO THE BORROWER PURSUANT TO SECTION 326 OF THE USA PATRIOT ACT OF 2001,
31 U.S.C. SECTION 5318:

 

IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help the
government fight the funding of terrorism and money laundering activities,
Federal law requires all financial institutions to obtain, verify, and record
information that identifies each person or entity that opens an account,
including any deposit account, treasury management account, loan, other
extension of credit, or other financial services product. What this means for
the Borrower: When the Borrower opens an account, if the Borrower is an
individual, the Administrative Agent and the Lenders will ask for the Borrower’s
name, residential address, tax identification number, date of birth, and other
information that will allow the Administrative Agent and the Lenders to identify
the Borrower, and, if the Borrower is not an individual, the Administrative
Agent and the Lenders will ask for the Borrower’s name, tax identification
number, business address, and other information that will allow Administrative
Agent and the Lenders to identify the Borrower.  The Administrative Agent and
the Lenders may also ask, if the Borrower is an individual, to see the
Borrower’s driver’s license or other identifying documents, and, if the Borrower
is not an individual, to see the Borrower’s legal organizational documents or
other identifying documents.

 

ARTICLE XI

THE ADMINISTRATIVE AGENT

 

11.1         APPOINTMENT; NATURE OF RELATIONSHIP.  BANK ONE, NA IS HEREBY
APPOINTED BY EACH OF THE LENDERS AS ITS CONTRACTUAL REPRESENTATIVE (HEREIN
REFERRED TO AS THE “ADMINISTRATIVE AGENT”) HEREUNDER AND UNDER EACH OTHER LOAN
DOCUMENT, AND EACH OF THE LENDERS IRREVOCABLY AUTHORIZES THE ADMINISTRATIVE
AGENT TO ACT AS THE CONTRACTUAL REPRESENTATIVE OF SUCH LENDER WITH THE RIGHTS
AND DUTIES EXPRESSLY SET FORTH HEREIN AND IN THE OTHER LOAN DOCUMENTS.  THE
ADMINISTRATIVE AGENT AGREES TO ACT AS SUCH CONTRACTUAL REPRESENTATIVE UPON THE
EXPRESS CONDITIONS CONTAINED IN THIS ARTICLE XI.  NOTWITHSTANDING THE USE OF THE
DEFINED TERM “ADMINISTRATIVE AGENT,” IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT
THE ADMINISTRATIVE AGENT SHALL NOT HAVE ANY FIDUCIARY RESPONSIBILITIES TO ANY
LENDER BY REASON OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND THAT THE
ADMINISTRATIVE AGENT IS MERELY ACTING AS THE CONTRACTUAL REPRESENTATIVE OF THE
LENDERS WITH ONLY THOSE DUTIES AS ARE EXPRESSLY SET FORTH IN THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS.  IN ITS CAPACITY AS THE LENDERS’ CONTRACTUAL
REPRESENTATIVE, THE ADMINISTRATIVE AGENT (I) DOES NOT HEREBY ASSUME ANY
FIDUCIARY DUTIES TO ANY OF THE LENDERS, (II) IS A “REPRESENTATIVE” OF THE
LENDERS WITHIN THE MEANING OF THE TERM “SECURED PARTY” AS DEFINED IN THE
ILLINOIS UNIFORM COMMERCIAL CODE AND (III) IS ACTING AS AN INDEPENDENT
CONTRACTOR, THE RIGHTS AND DUTIES OF WHICH ARE LIMITED TO THOSE EXPRESSLY SET
FORTH IN THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.  EACH OF THE LENDERS
HEREBY AGREES TO ASSERT NO CLAIM AGAINST THE ADMINISTRATIVE AGENT ON ANY AGENCY
THEORY OR ANY OTHER THEORY OF LIABILITY FOR BREACH OF FIDUCIARY DUTY, ALL OF
WHICH CLAIMS EACH LENDER HEREBY WAIVES.

 

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11.2         POWERS.  THE ADMINISTRATIVE AGENT SHALL HAVE AND MAY EXERCISE SUCH
POWERS UNDER THE LOAN DOCUMENTS AS ARE SPECIFICALLY DELEGATED TO THE
ADMINISTRATIVE AGENT BY THE TERMS OF EACH THEREOF, TOGETHER WITH SUCH POWERS AS
ARE REASONABLY INCIDENTAL THERETO.  THE ADMINISTRATIVE AGENT SHALL HAVE NO
IMPLIED DUTIES TO THE LENDERS, OR ANY OBLIGATION TO THE LENDERS TO TAKE ANY
ACTION THEREUNDER EXCEPT ANY ACTION SPECIFICALLY PROVIDED BY THE LOAN DOCUMENTS
TO BE TAKEN BY THE ADMINISTRATIVE AGENT.

 

11.3         GENERAL IMMUNITY.  NEITHER THE ADMINISTRATIVE AGENT NOR ANY OF ITS
DIRECTORS, OFFICERS, AGENTS OR EMPLOYEES SHALL BE LIABLE TO THE BORROWER, THE
LENDERS OR ANY LENDER FOR ANY ACTION TAKEN OR OMITTED TO BE TAKEN BY IT OR THEM
HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT OR IN CONNECTION HEREWITH OR
THEREWITH EXCEPT TO THE EXTENT SUCH ACTION OR INACTION IS DETERMINED IN A FINAL
NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO HAVE ARISEN FROM
THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH PERSON.

 

11.4         NO RESPONSIBILITY FOR LOANS, RECITALS, ETC.  NEITHER THE
ADMINISTRATIVE AGENT NOR ANY OF ITS DIRECTORS, OFFICERS, AGENTS OR EMPLOYEES
SHALL BE RESPONSIBLE TO ANY LENDER FOR OR HAVE ANY DUTY TO ANY LENDER TO
ASCERTAIN, INQUIRE INTO, OR VERIFY (A) ANY STATEMENT, WARRANTY OR REPRESENTATION
MADE IN CONNECTION WITH ANY LOAN DOCUMENT OR ANY BORROWING HEREUNDER; (B) THE
PERFORMANCE OR OBSERVANCE OF ANY OF THE COVENANTS OR AGREEMENTS OF ANY OBLIGOR
UNDER ANY LOAN DOCUMENT, INCLUDING, WITHOUT LIMITATION, ANY AGREEMENT BY AN
OBLIGOR TO FURNISH INFORMATION DIRECTLY TO EACH LENDER; (C) THE SATISFACTION OF
ANY CONDITION SPECIFIED IN ARTICLE IV, EXCEPT RECEIPT OF ITEMS REQUIRED TO BE
DELIVERED SOLELY TO THE ADMINISTRATIVE AGENT; (D) THE EXISTENCE OR POSSIBLE
EXISTENCE OF ANY DEFAULT OR UNMATURED DEFAULT; (E) THE VALIDITY, ENFORCEABILITY,
EFFECTIVENESS, SUFFICIENCY OR GENUINENESS OF ANY LOAN DOCUMENT OR ANY OTHER
INSTRUMENT OR WRITING FURNISHED IN CONNECTION THEREWITH; (F) THE VALUE,
SUFFICIENCY, CREATION, PERFECTION OR PRIORITY OF ANY LIEN IN ANY COLLATERAL
SECURITY; OR (G) THE FINANCIAL CONDITION OF THE BORROWER OR ANY GUARANTOR OF ANY
OF THE OBLIGATIONS OR OF ANY OF THE BORROWER’S OR ANY SUCH GUARANTOR’S
RESPECTIVE SUBSIDIARIES.  THE ADMINISTRATIVE AGENT SHALL HAVE NO DUTY TO
DISCLOSE TO THE LENDERS INFORMATION THAT IS NOT REQUIRED TO BE FURNISHED BY THE
BORROWER TO THE ADMINISTRATIVE AGENT AT SUCH TIME, BUT IS VOLUNTARILY FURNISHED
BY THE BORROWER TO THE ADMINISTRATIVE AGENT (EITHER IN ITS CAPACITY AS
ADMINISTRATIVE AGENT OR IN ITS INDIVIDUAL CAPACITY).

 

11.5         ACTION ON INSTRUCTIONS OF LENDERS.  THE ADMINISTRATIVE AGENT SHALL
IN ALL CASES BE FULLY PROTECTED IN ACTING, OR IN REFRAINING FROM ACTING,
HEREUNDER AND UNDER ANY OTHER LOAN DOCUMENT IN ACCORDANCE WITH WRITTEN
INSTRUCTIONS SIGNED BY THE REQUIRED LENDERS, AND SUCH INSTRUCTIONS AND ANY
ACTION TAKEN OR FAILURE TO ACT PURSUANT THERETO SHALL BE BINDING ON ALL OF THE
LENDERS.  THE LENDERS HEREBY ACKNOWLEDGE THAT THE ADMINISTRATIVE AGENT SHALL BE
UNDER NO DUTY TO TAKE ANY DISCRETIONARY ACTION PERMITTED TO BE TAKEN BY IT
PURSUANT TO THE PROVISIONS OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT UNLESS
IT SHALL BE REQUESTED IN WRITING TO DO SO BY THE REQUIRED LENDERS.  THE
ADMINISTRATIVE AGENT SHALL BE FULLY JUSTIFIED IN FAILING OR REFUSING TO TAKE ANY
ACTION HEREUNDER AND UNDER ANY OTHER LOAN DOCUMENT UNLESS IT SHALL FIRST BE
INDEMNIFIED TO ITS SATISFACTION BY THE LENDERS PRO RATA AGAINST ANY AND ALL
LIABILITY, COST AND EXPENSE THAT IT MAY INCUR BY REASON OF TAKING OR CONTINUING
TO TAKE ANY SUCH ACTION; PROVIDED THAT THIS SECTION 11.5 SHALL NOT AFFECT THE
BORROWER’S RIGHTS AGAINST THE LENDERS UNDER THE TERMS OF THIS AGREEMENT.

 

11.6         EMPLOYMENT OF ADMINISTRATIVE AGENTS AND COUNSEL.  THE
ADMINISTRATIVE AGENT MAY EXECUTE ANY OF ITS DUTIES AS ADMINISTRATIVE AGENT
HEREUNDER AND UNDER ANY OTHER LOAN DOCUMENT BY OR THROUGH EMPLOYEES, AGENTS, AND
ATTORNEYS-IN-FACT AND SHALL NOT BE ANSWERABLE TO THE LENDERS, EXCEPT AS TO MONEY
OR SECURITIES RECEIVED BY IT OR ITS AUTHORIZED AGENTS, FOR THE DEFAULT OR
MISCONDUCT OF ANY SUCH AGENTS OR ATTORNEYS-IN-FACT SELECTED BY IT WITH
REASONABLE CARE.  THE ADMINISTRATIVE AGENT SHALL BE ENTITLED TO ADVICE OF
COUNSEL CONCERNING THE CONTRACTUAL ARRANGEMENT BETWEEN THE ADMINISTRATIVE AGENT
AND THE LENDERS AND ALL MATTERS PERTAINING TO THE ADMINISTRATIVE AGENT’S DUTIES
HEREUNDER AND UNDER ANY OTHER LOAN DOCUMENT.

 

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11.7         RELIANCE ON DOCUMENTS; COUNSEL.  THE ADMINISTRATIVE AGENT SHALL BE
ENTITLED TO RELY UPON ANY NOTE, NOTICE, CONSENT, CERTIFICATE, AFFIDAVIT, LETTER,
TELEGRAM, FACSIMILE, TELEX, ELECTRONIC MAIL MESSAGE, STATEMENT, PAPER OR
DOCUMENT BELIEVED BY IT TO BE GENUINE AND CORRECT AND TO HAVE BEEN SIGNED OR
SENT BY THE PROPER PERSON OR PERSONS, AND, IN RESPECT TO LEGAL MATTERS, UPON THE
OPINION OF COUNSEL SELECTED BY THE ADMINISTRATIVE AGENT, WHICH COUNSEL MAY BE
EMPLOYEES OF THE ADMINISTRATIVE AGENT.  FOR PURPOSES OF DETERMINING COMPLIANCE
WITH THE CONDITIONS SPECIFIED IN SECTIONS 4.1 AND 4.2, EACH LENDER THAT HAS
SIGNED THIS AGREEMENT SHALL BE DEEMED TO HAVE CONSENTED TO, APPROVED OR ACCEPTED
OR TO BE SATISFIED WITH, EACH DOCUMENT OR OTHER MATTER REQUIRED THEREUNDER TO BE
CONSENTED TO OR APPROVED BY OR ACCEPTABLE OR SATISFACTORY TO A LENDER UNLESS THE
ADMINISTRATIVE AGENT SHALL HAVE RECEIVED NOTICE FROM SUCH LENDER PRIOR TO THE
APPLICABLE DATE SPECIFYING ITS OBJECTION THERETO.

 

11.8         ADMINISTRATIVE AGENT’S REIMBURSEMENT AND INDEMNIFICATION.  THE
LENDERS AGREE TO REIMBURSE AND INDEMNIFY THE ADMINISTRATIVE AGENT RATABLY IN
PROPORTION TO THEIR RESPECTIVE COMMITMENTS (OR, IF THE COMMITMENTS HAVE BEEN
TERMINATED, IN PROPORTION TO THEIR COMMITMENTS IMMEDIATELY PRIOR TO SUCH
TERMINATION) (I) FOR ANY AMOUNTS NOT REIMBURSED BY THE BORROWER FOR WHICH THE
ADMINISTRATIVE AGENT IS ENTITLED TO REIMBURSEMENT BY THE BORROWER UNDER THE LOAN
DOCUMENTS, (II) FOR ANY OTHER EXPENSES INCURRED BY THE ADMINISTRATIVE AGENT ON
BEHALF OF THE LENDERS, IN CONNECTION WITH THE PREPARATION, EXECUTION, DELIVERY,
ADMINISTRATION AND ENFORCEMENT OF THE LOAN DOCUMENTS (INCLUDING, WITHOUT
LIMITATION, FOR ANY EXPENSES INCURRED BY THE ADMINISTRATIVE AGENT IN CONNECTION
WITH ANY DISPUTE BETWEEN THE ADMINISTRATIVE AGENT AND ANY LENDER OR BETWEEN TWO
OR MORE OF THE LENDERS) AND (III) FOR ANY LIABILITIES, OBLIGATIONS, LOSSES,
DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS
OF ANY KIND AND NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY OR
ASSERTED AGAINST THE ADMINISTRATIVE AGENT IN ANY WAY RELATING TO OR ARISING OUT
OF THE LOAN DOCUMENTS OR ANY OTHER DOCUMENT DELIVERED IN CONNECTION THEREWITH OR
THE TRANSACTIONS CONTEMPLATED THEREBY (INCLUDING, WITHOUT LIMITATION, FOR ANY
SUCH AMOUNTS INCURRED BY OR ASSERTED AGAINST THE ADMINISTRATIVE AGENT IN
CONNECTION WITH ANY DISPUTE BETWEEN THE ADMINISTRATIVE AGENT AND ANY LENDER OR
BETWEEN TWO OR MORE OF THE LENDERS), OR THE ENFORCEMENT OF ANY OF THE TERMS OF
THE LOAN DOCUMENTS OR OF ANY SUCH OTHER DOCUMENTS; PROVIDED THAT (I) NO LENDER
SHALL BE LIABLE FOR ANY OF THE FOREGOING TO THE EXTENT ANY OF THE FOREGOING IS
FOUND IN A FINAL NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO
HAVE RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE
ADMINISTRATIVE AGENT AND (II) ANY INDEMNIFICATION REQUIRED PURSUANT TO
SECTION 3.5(G) SHALL, NOTWITHSTANDING THE PROVISIONS OF THIS SECTION 11.8, BE
PAID BY THE RELEVANT LENDER IN ACCORDANCE WITH THE PROVISIONS THEREOF.  THE
OBLIGATIONS OF THE LENDERS UNDER THIS SECTION 11.8 SHALL SURVIVE PAYMENT OF THE
OBLIGATIONS AND TERMINATION OF THIS AGREEMENT.

 

11.9         NOTICE OF DEFAULT.  THE ADMINISTRATIVE AGENT SHALL NOT BE DEEMED TO
HAVE KNOWLEDGE OR NOTICE OF THE OCCURRENCE OF ANY DEFAULT OR UNMATURED DEFAULT
HEREUNDER UNLESS THE ADMINISTRATIVE AGENT HAS RECEIVED WRITTEN NOTICE FROM A
LENDER OR THE BORROWER REFERRING TO THIS AGREEMENT DESCRIBING SUCH DEFAULT OR
UNMATURED DEFAULT AND STATING THAT SUCH NOTICE IS A “NOTICE OF DEFAULT”.  IN THE
EVENT THAT THE ADMINISTRATIVE AGENT RECEIVES SUCH A NOTICE, THE ADMINISTRATIVE
AGENT SHALL GIVE PROMPT NOTICE THEREOF TO THE LENDERS.

 

11.10       RIGHTS AS A LENDER.  IN THE EVENT THE ADMINISTRATIVE AGENT IS A
LENDER, THE ADMINISTRATIVE AGENT SHALL HAVE THE SAME RIGHTS AND POWERS HEREUNDER
AND UNDER ANY OTHER LOAN DOCUMENT WITH RESPECT TO ITS COMMITMENT AND ITS LOANS
AS ANY LENDER AND MAY EXERCISE THE SAME AS THOUGH IT WERE NOT THE ADMINISTRATIVE
AGENT, AND THE TERM “LENDER” OR “LENDERS” SHALL, AT ANY TIME WHEN THE
ADMINISTRATIVE AGENT IS A LENDER, UNLESS THE CONTEXT OTHERWISE INDICATES,
INCLUDE THE ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.  THE ADMINISTRATIVE
AGENT AND ITS AFFILIATES MAY ACCEPT DEPOSITS FROM, LEND MONEY TO, AND GENERALLY
ENGAGE IN ANY KIND OF TRUST, DEBT, EQUITY OR OTHER TRANSACTION, IN ADDITION TO
THOSE CONTEMPLATED BY THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, WITH THE
BORROWER OR ANY OF ITS SUBSIDIARIES IN WHICH THE BORROWER OR SUCH SUBSIDIARY IS
NOT RESTRICTED HEREBY FROM ENGAGING WITH ANY OTHER PERSON.  THE ADMINISTRATIVE
AGENT, IN ITS INDIVIDUAL CAPACITY, IS NOT OBLIGATED TO REMAIN A LENDER.

 

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

 

11.12       SUCCESSOR ADMINISTRATIVE AGENT.  THE ADMINISTRATIVE AGENT MAY RESIGN
AT ANY TIME BY GIVING WRITTEN NOTICE THEREOF TO THE LENDERS AND THE BORROWER,
SUCH RESIGNATION TO BE EFFECTIVE UPON THE APPOINTMENT OF A SUCCESSOR
ADMINISTRATIVE AGENT OR, IF NO SUCCESSOR ADMINISTRATIVE AGENT HAS BEEN
APPOINTED, FORTY-FIVE DAYS AFTER THE RETIRING ADMINISTRATIVE AGENT GIVES NOTICE
OF ITS INTENTION TO RESIGN.  THE ADMINISTRATIVE AGENT MAY BE REMOVED AT ANY TIME
WITH OR WITHOUT CAUSE BY WRITTEN NOTICE RECEIVED BY THE ADMINISTRATIVE AGENT
FROM THE REQUIRED LENDERS, SUCH REMOVAL TO BE EFFECTIVE ON THE DATE SPECIFIED BY
THE REQUIRED LENDERS.  UPON ANY SUCH RESIGNATION OR REMOVAL, THE REQUIRED
LENDERS SHALL HAVE THE RIGHT TO APPOINT, ON BEHALF OF THE BORROWER AND THE
LENDERS, A SUCCESSOR ADMINISTRATIVE AGENT, WHICH SUCCESSOR AGENT SHALL (UNLESS A
DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING) BE SUBJECT TO APPROVAL BY THE
BORROWER, WHICH APPROVAL SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED.  IF NO
SUCCESSOR ADMINISTRATIVE AGENT SHALL HAVE BEEN SO APPOINTED BY THE REQUIRED
LENDERS WITHIN THIRTY DAYS AFTER THE RESIGNING ADMINISTRATIVE AGENT’S GIVING
NOTICE OF ITS INTENTION TO RESIGN, THEN THE RESIGNING ADMINISTRATIVE AGENT MAY
APPOINT, ON BEHALF OF THE BORROWER AND THE LENDERS, A SUCCESSOR ADMINISTRATIVE
AGENT, WHICH SUCCESSOR AGENT SHALL (UNLESS A DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING) BE SUBJECT TO APPROVAL BY THE BORROWER, WHICH APPROVAL SHALL NOT BE
UNREASONABLY WITHHELD OR DELAYED.  NOTWITHSTANDING THE PREVIOUS SENTENCE, THE
ADMINISTRATIVE AGENT MAY AT ANY TIME WITHOUT THE CONSENT OF THE BORROWER OR ANY
LENDER, APPOINT ANY OF ITS AFFILIATES WHICH IS A COMMERCIAL BANK AS A SUCCESSOR
ADMINISTRATIVE AGENT HEREUNDER.  IF THE ADMINISTRATIVE AGENT HAS RESIGNED OR
BEEN REMOVED AND NO SUCCESSOR ADMINISTRATIVE AGENT HAS BEEN APPOINTED, THE
LENDERS MAY PERFORM ALL THE DUTIES OF THE ADMINISTRATIVE AGENT HEREUNDER AND THE
BORROWER SHALL MAKE ALL PAYMENTS IN RESPECT OF THE OBLIGATIONS TO THE APPLICABLE
LENDER AND FOR ALL OTHER PURPOSES SHALL DEAL DIRECTLY WITH THE LENDERS.  NO
SUCCESSOR ADMINISTRATIVE AGENT SHALL BE DEEMED TO BE APPOINTED HEREUNDER UNTIL
SUCH SUCCESSOR ADMINISTRATIVE AGENT HAS ACCEPTED THE APPOINTMENT.  ANY SUCH
SUCCESSOR ADMINISTRATIVE AGENT SHALL BE A COMMERCIAL BANK HAVING CAPITAL AND
RETAINED EARNINGS OF AT LEAST $100,000,000.  UPON THE ACCEPTANCE OF ANY
APPOINTMENT AS ADMINISTRATIVE AGENT HEREUNDER BY A SUCCESSOR ADMINISTRATIVE
AGENT, SUCH SUCCESSOR ADMINISTRATIVE AGENT SHALL THEREUPON SUCCEED TO AND BECOME
VESTED WITH ALL THE RIGHTS, POWERS, PRIVILEGES AND DUTIES OF THE RESIGNING OR
REMOVED ADMINISTRATIVE AGENT.  UPON THE EFFECTIVENESS OF THE RESIGNATION OR
REMOVAL OF THE ADMINISTRATIVE AGENT, THE RESIGNING OR REMOVED ADMINISTRATIVE
AGENT SHALL BE DISCHARGED FROM ITS DUTIES AND OBLIGATIONS HEREUNDER AND UNDER
THE LOAN DOCUMENTS.  AFTER THE EFFECTIVENESS OF THE RESIGNATION OR REMOVAL OF AN
ADMINISTRATIVE AGENT, THE PROVISIONS OF THIS ARTICLE XI SHALL CONTINUE IN EFFECT
FOR THE BENEFIT OF SUCH ADMINISTRATIVE AGENT IN RESPECT OF ANY ACTIONS TAKEN OR
OMITTED TO BE TAKEN BY IT WHILE IT WAS ACTING AS THE ADMINISTRATIVE AGENT
HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS.  IN THE EVENT THAT THERE IS A
SUCCESSOR TO THE ADMINISTRATIVE AGENT BY MERGER, OR THE ADMINISTRATIVE AGENT
ASSIGNS ITS DUTIES AND OBLIGATIONS TO AN AFFILIATE PURSUANT TO THIS
SECTION 11.12, THEN THE TERM “PRIME RATE” AS USED IN THIS AGREEMENT SHALL MEAN
THE PRIME RATE, BASE RATE OR OTHER ANALOGOUS RATE OF THE NEW ADMINISTRATIVE
AGENT.

 

11.13       ADMINISTRATIVE AGENT AND ARRANGER FEES.  THE BORROWER AGREES TO PAY
TO THE ADMINISTRATIVE AGENT AND THE ARRANGER, FOR THEIR RESPECTIVE ACCOUNTS, THE
FEES AGREED TO BY THE BORROWER, THE ADMINISTRATIVE AGENT AND THE ARRANGER
PURSUANT TO THAT CERTAIN LETTER AGREEMENT DATED OCTOBER 3, 2003, OR AS OTHERWISE
AGREED FROM TIME TO TIME.

 

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11.14       DELEGATION TO AFFILIATES.  THE BORROWER AND THE LENDERS AGREE THAT
THE ADMINISTRATIVE AGENT MAY DELEGATE ANY OF ITS DUTIES UNDER THIS AGREEMENT TO
ANY OF ITS AFFILIATES.  ANY SUCH AFFILIATE (AND SUCH AFFILIATE’S DIRECTORS,
OFFICERS, AGENTS AND EMPLOYEES) WHICH PERFORMS DUTIES IN CONNECTION WITH THIS
AGREEMENT SHALL BE ENTITLED TO THE SAME BENEFITS OF THE INDEMNIFICATION, WAIVER
AND OTHER PROTECTIVE PROVISIONS TO WHICH THE ADMINISTRATIVE AGENT IS ENTITLED
UNDER ARTICLES XI AND XII.

 

11.15       EXECUTION OF COLLATERAL DOCUMENTS.  THE LENDERS HEREBY EMPOWER AND
AUTHORIZE THE ADMINISTRATIVE AGENT TO EXECUTE AND DELIVER TO THE BORROWER ON
THEIR BEHALF THE COLLATERAL DOCUMENTS AND ALL RELATED FINANCING STATEMENTS AND
ANY FINANCING STATEMENTS, AGREEMENTS, DOCUMENTS OR INSTRUMENTS AS SHALL BE
NECESSARY OR APPROPRIATE TO EFFECT THE PURPOSES OF THE COLLATERAL DOCUMENTS.

 

11.16       COLLATERAL RELEASES.  THE LENDERS HEREBY EMPOWER AND AUTHORIZE THE
ADMINISTRATIVE AGENT TO EXECUTE AND DELIVER TO THE BORROWER ON THEIR BEHALF ANY
AGREEMENTS, DOCUMENTS OR INSTRUMENTS AS SHALL BE NECESSARY OR APPROPRIATE TO
EFFECT ANY RELEASES OF COLLATERAL WHICH SHALL BE PERMITTED BY THE TERMS HEREOF
OR OF ANY OTHER LOAN DOCUMENT OR WHICH SHALL OTHERWISE HAVE BEEN APPROVED BY THE
REQUIRED LENDERS (OR, IF REQUIRED BY THE TERMS OF SECTION 9.2, ALL OF THE
LENDERS) IN WRITING.

 

ARTICLE XII

SETOFF; RATABLE PAYMENTS

 

12.1         SETOFF.  IN ADDITION TO, AND WITHOUT LIMITATION OF, ANY RIGHTS OF
THE LENDERS UNDER APPLICABLE LAW, IF THE BORROWER BECOMES INSOLVENT, HOWEVER
EVIDENCED, OR ANY DEFAULT OCCURS, ANY AND ALL DEPOSITS (INCLUDING ALL ACCOUNT
BALANCES, WHETHER PROVISIONAL OR FINAL AND WHETHER OR NOT COLLECTED OR
AVAILABLE) AND ANY OTHER INDEBTEDNESS AT ANY TIME HELD OR OWING BY ANY LENDER OR
ANY AFFILIATE OF ANY LENDER TO OR FOR THE CREDIT OR ACCOUNT OF THE BORROWER MAY
BE OFFSET AND APPLIED TOWARD THE PAYMENT OF THE SECURED OBLIGATIONS OWING TO
SUCH LENDER, WHETHER OR NOT THE SECURED OBLIGATIONS, OR ANY PART THEREOF, SHALL
THEN BE DUE.

 

12.2         RATABLE PAYMENTS.  IF ANY LENDER, WHETHER BY SETOFF OR OTHERWISE,
HAS PAYMENT MADE TO IT UPON ITS LOANS (OTHER THAN PAYMENTS RECEIVED PURSUANT TO
SECTION 3.1, 3.2, 3.4 OR 3.5) IN A GREATER PROPORTION THAN THAT RECEIVED BY ANY
OTHER LENDER, SUCH LENDER AGREES, PROMPTLY UPON DEMAND, TO PURCHASE A PORTION OF
THE LOANS HELD BY THE OTHER LENDERS SO THAT AFTER SUCH PURCHASE EACH LENDER WILL
HOLD ITS RATABLE PROPORTION OF LOANS.  IF ANY LENDER, WHETHER IN CONNECTION WITH
SETOFF OR AMOUNTS WHICH MIGHT BE SUBJECT TO SETOFF OR OTHERWISE, RECEIVES
COLLATERAL OR OTHER PROTECTION FOR ITS OBLIGATIONS OR SUCH AMOUNTS WHICH MAY BE
SUBJECT TO SETOFF, SUCH LENDER AGREES, PROMPTLY UPON DEMAND, TO TAKE SUCH ACTION
NECESSARY SUCH THAT ALL LENDERS SHARE IN THE BENEFITS OF SUCH COLLATERAL RATABLY
IN PROPORTION TO THEIR LOANS.  IN CASE ANY SUCH PAYMENT IS DISTURBED BY LEGAL
PROCESS, OR OTHERWISE, APPROPRIATE FURTHER ADJUSTMENTS SHALL BE MADE.

 

ARTICLE XIII

BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

 

13.1         SUCCESSORS AND ASSIGNS.  THE TERMS AND PROVISIONS OF THE LOAN
DOCUMENTS SHALL BE BINDING UPON AND INURE TO THE BENEFIT OF THE BORROWER AND THE
LENDERS AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS PERMITTED HEREBY, EXCEPT
THAT (A) THE BORROWER SHALL NOT HAVE THE RIGHT TO ASSIGN ITS RIGHTS OR
OBLIGATIONS UNDER THE LOAN DOCUMENTS WITHOUT THE PRIOR WRITTEN CONSENT OF EACH
LENDER, (B) ANY ASSIGNMENT BY ANY LENDER MUST BE MADE IN COMPLIANCE WITH
SECTION 13.3, AND (C) ANY TRANSFER BY PARTICIPATION MUST BE MADE IN COMPLIANCE
WITH SECTION 13.2.  ANY ATTEMPTED ASSIGNMENT OR TRANSFER BY ANY PARTY NOT MADE
IN COMPLIANCE WITH THIS SECTION 13.1 SHALL BE NULL AND VOID, UNLESS SUCH
ATTEMPTED

 

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ASSIGNMENT OR TRANSFER IS TREATED AS A PARTICIPATION IN ACCORDANCE WITH
SECTION 13.3.2.  THE PARTIES TO THIS AGREEMENT ACKNOWLEDGE THAT CLAUSE (B) OF
THIS SECTION 13.1 RELATES ONLY TO ABSOLUTE ASSIGNMENTS AND THIS SECTION 13.1
DOES NOT PROHIBIT ASSIGNMENTS CREATING SECURITY INTERESTS, INCLUDING, WITHOUT
LIMITATION, (X) ANY PLEDGE OR ASSIGNMENT BY ANY LENDER OF ALL OR ANY PORTION OF
ITS RIGHTS UNDER THIS AGREEMENT AND ANY NOTE TO A FEDERAL RESERVE BANK OR (Y) IN
THE CASE OF A LENDER WHICH IS A FUND, ANY PLEDGE OR ASSIGNMENT OF ALL OR ANY
PORTION OF ITS RIGHTS UNDER THIS AGREEMENT AND ANY NOTE TO ITS TRUSTEE IN
SUPPORT OF ITS OBLIGATIONS TO ITS TRUSTEE; PROVIDED, HOWEVER, THAT NO SUCH
PLEDGE OR ASSIGNMENT CREATING A SECURITY INTEREST SHALL RELEASE THE TRANSFEROR
LENDER FROM ITS OBLIGATIONS HEREUNDER UNLESS AND UNTIL THE PARTIES THERETO HAVE
COMPLIED WITH THE PROVISIONS OF SECTION 13.3.  THE ADMINISTRATIVE AGENT MAY
TREAT THE PERSON WHICH MADE ANY LOAN OR WHICH HOLDS ANY NOTE AS THE OWNER
THEREOF FOR ALL PURPOSES HEREOF UNLESS AND UNTIL SUCH PERSON COMPLIES WITH
SECTION 13.3; PROVIDED, HOWEVER, THAT THE ADMINISTRATIVE AGENT MAY IN ITS
DISCRETION (BUT SHALL NOT BE REQUIRED TO) FOLLOW INSTRUCTIONS FROM THE PERSON
WHICH MADE ANY LOAN OR WHICH HOLDS ANY NOTE TO DIRECT PAYMENTS RELATING TO SUCH
LOAN OR NOTE TO ANOTHER PERSON.  ANY ASSIGNEE OF THE RIGHTS TO ANY LOAN OR ANY
NOTE AGREES BY ACCEPTANCE OF SUCH ASSIGNMENT TO BE BOUND BY ALL THE TERMS AND
PROVISIONS OF THE LOAN DOCUMENTS.  ANY REQUEST, AUTHORITY OR CONSENT OF ANY
PERSON, WHO AT THE TIME OF MAKING SUCH REQUEST OR GIVING SUCH AUTHORITY OR
CONSENT IS THE OWNER OF THE RIGHTS TO ANY LOAN (WHETHER OR NOT A NOTE HAS BEEN
ISSUED IN EVIDENCE THEREOF), SHALL BE CONCLUSIVE AND BINDING ON ANY SUBSEQUENT
HOLDER OR ASSIGNEE OF THE RIGHTS TO SUCH LOAN.

 

13.2         PARTICIPATIONS.

 

13.2.1      PERMITTED PARTICIPANTS; EFFECT.  ANY LENDER MAY AT ANY TIME SELL TO
ONE OR MORE BANKS OR OTHER ENTITIES (“PARTICIPANTS”) PARTICIPATING INTERESTS IN
ANY OUTSTANDING CREDIT EXPOSURE LOAN OWING TO SUCH LENDER, ANY NOTE HELD BY SUCH
LENDER, ANY COMMITMENT OF SUCH LENDER OR ANY OTHER INTEREST OF SUCH LENDER UNDER
THE LOAN DOCUMENTS.  IN THE EVENT OF ANY SUCH SALE BY A LENDER OF PARTICIPATING
INTERESTS TO A PARTICIPANT, SUCH LENDER’S OBLIGATIONS UNDER THE LOAN DOCUMENTS
SHALL REMAIN UNCHANGED, SUCH LENDER SHALL REMAIN SOLELY RESPONSIBLE TO THE OTHER
PARTIES HERETO FOR THE PERFORMANCE OF SUCH OBLIGATIONS, SUCH LENDER SHALL REMAIN
THE OWNER OF ITS OUTSTANDING CREDIT EXPOSURE LOANS AND THE HOLDER OF ANY NOTE
ISSUED TO IT IN EVIDENCE THEREOF FOR ALL PURPOSES UNDER THE LOAN DOCUMENTS, ALL
AMOUNTS PAYABLE BY THE BORROWER UNDER THIS AGREEMENT SHALL BE DETERMINED AS IF
SUCH LENDER HAD NOT SOLD SUCH PARTICIPATING INTERESTS, AND THE BORROWER AND THE
ADMINISTRATIVE AGENT SHALL CONTINUE TO DEAL SOLELY AND DIRECTLY WITH SUCH LENDER
IN CONNECTION WITH SUCH LENDER’S RIGHTS AND OBLIGATIONS UNDER THE LOAN
DOCUMENTS.

 

13.2.2      VOTING RIGHTS.  EACH LENDER SHALL RETAIN THE SOLE RIGHT TO APPROVE,
WITHOUT THE CONSENT OF ANY PARTICIPANT, ANY AMENDMENT, MODIFICATION OR WAIVER OF
ANY PROVISION OF THE LOAN DOCUMENTS OTHER THAN ANY AMENDMENT, MODIFICATION OR
WAIVER WITH RESPECT TO ANY CREDIT EXTENSION OR COMMITMENT IN WHICH SUCH
PARTICIPANT HAS AN INTEREST WHICH WOULD REQUIRE CONSENT OF ALL OF THE LENDERS
PURSUANT TO THE TERMS OF SECTION 9.2 OR OF ANY OTHER LOAN DOCUMENT.

 

13.2.3      BENEFIT OF CERTAIN PROVISIONS.  THE BORROWER AGREES THAT EACH
PARTICIPANT SHALL BE DEEMED TO HAVE THE RIGHT OF SETOFF PROVIDED IN SECTION 12.1
IN RESPECT OF ITS PARTICIPATING INTEREST IN AMOUNTS OWING UNDER THE LOAN
DOCUMENTS TO THE SAME EXTENT AS IF THE AMOUNT OF ITS PARTICIPATING INTEREST WERE
OWING DIRECTLY TO IT AS A LENDER UNDER THE LOAN DOCUMENTS; PROVIDED THAT EACH
LENDER SHALL RETAIN THE RIGHT OF SETOFF PROVIDED IN SECTION 12.1 WITH RESPECT TO
THE AMOUNT OF PARTICIPATING INTERESTS SOLD TO EACH PARTICIPANT.  THE LENDERS
AGREE TO SHARE WITH EACH PARTICIPANT, AND EACH PARTICIPANT, BY EXERCISING THE
RIGHT OF SETOFF PROVIDED IN SECTION 12.1, AGREES TO SHARE WITH EACH LENDER, ANY
AMOUNT RECEIVED PURSUANT TO THE EXERCISE OF ITS RIGHT OF SETOFF, SUCH AMOUNTS TO
BE SHARED IN ACCORDANCE WITH SECTION 12.2 AS IF EACH PARTICIPANT WERE A LENDER. 
THE BORROWER FURTHER AGREES THAT EACH PARTICIPANT SHALL BE ENTITLED TO THE
BENEFITS OF SECTIONS 3.1, 3.2, 3.4 AND 3.5 TO THE SAME EXTENT AS IF IT WERE A
LENDER AND HAD ACQUIRED ITS INTEREST BY ASSIGNMENT

 

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PURSUANT TO SECTION 13.3; PROVIDED THAT (A) A PARTICIPANT SHALL NOT BE ENTITLED
TO RECEIVE ANY GREATER PAYMENT UNDER SECTION 3.1, 3.2 OR 3.5 THAN THE LENDER WHO
SOLD THE PARTICIPATING INTEREST TO SUCH PARTICIPANT WOULD HAVE RECEIVED HAD IT
RETAINED SUCH INTEREST FOR ITS OWN ACCOUNT, UNLESS THE SALE OF SUCH INTEREST TO
SUCH PARTICIPANT IS MADE WITH THE PRIOR WRITTEN CONSENT OF THE BORROWER, AND (B)
ANY PARTICIPANT NOT INCORPORATED UNDER THE LAWS OF THE UNITED STATES OF AMERICA
OR ANY STATE THEREOF AGREES TO COMPLY WITH THE PROVISIONS OF SECTION 3.5 TO THE
SAME EXTENT AS IF IT WERE A LENDER.

 

13.3         ASSIGNMENTS.

 

13.3.1      PERMITTED ASSIGNMENTS.  ANY LENDER MAY AT ANY TIME ASSIGN TO ONE OR
MORE BANKS OR OTHER ENTITIES (“PURCHASERS”) ALL OR ANY PART OF ITS RIGHTS AND
OBLIGATIONS UNDER THE LOAN DOCUMENTS.  SUCH ASSIGNMENT SHALL BE SUBSTANTIALLY IN
THE FORM OF EXHIBIT C OR IN SUCH OTHER FORM AS MAY BE AGREED TO BY THE PARTIES
THERETO.  EACH SUCH ASSIGNMENT WITH RESPECT TO A PURCHASER WHICH IS NOT A LENDER
OR AN AFFILIATE OF A LENDER OR AN APPROVED FUND SHALL EITHER BE IN AN AMOUNT
EQUAL TO THE ENTIRE APPLICABLE COMMITMENT AND LOANS OF THE ASSIGNING LENDER OR 
(UNLESS EACH OF THE BORROWER AND THE ADMINISTRATIVE AGENT OTHERWISE CONSENTS) BE
IN AN AGGREGATE AMOUNT NOT LESS THAN $5,000,000 OR, IF LESS, THE REMAINING
AMOUNT OF THE ASSIGNING LENDER’S COMMITMENT. THE AMOUNT OF THE ASSIGNMENT SHALL
BE BASED ON THE COMMITMENT OR OUTSTANDING LOANS (IF THE COMMITMENT HAS BEEN
TERMINATED) SUBJECT TO THE ASSIGNMENT, DETERMINED AS OF THE DATE OF SUCH
ASSIGNMENT OR AS OF THE “TRADE DATE,” IF THE “TRADE DATE” IS SPECIFIED IN THE
ASSIGNMENT.

 

13.3.2      CONSENTS.  THE CONSENT OF THE BORROWER SHALL BE REQUIRED PRIOR TO AN
ASSIGNMENT BECOMING EFFECTIVE UNLESS THE PURCHASER IS A LENDER, AN AFFILIATE OF
A LENDER OR AN APPROVED FUND; PROVIDED THAT THE CONSENT OF THE BORROWER SHALL
NOT BE REQUIRED IF A DEFAULT HAS OCCURRED AND IS CONTINUING.  THE CONSENT OF THE
ADMINISTRATIVE AGENT AND THE LC ISSUER SHALL BE REQUIRED PRIOR TO AN ASSIGNMENT
BECOMING EFFECTIVE UNLESS THE PURCHASER IS A LENDER, AN AFFILIATE OF A LENDER OR
AN APPROVED FUND.  ANY CONSENT REQUIRED UNDER THIS SECTION 13.3.2 SHALL NOT BE
UNREASONABLY WITHHELD OR DELAYED; PROVIDED THAT THE BORROWER MAY WITHHOLD ITS
CONSENT TO ANY ASSIGNMENT IF THE PROPOSED ASSIGNEE WOULD BE ENTITLED, AS OF THE
DATE OF SUCH PROPOSED ASSIGNMENT, TO RECEIVE ANY GREATER PAYMENT UNDER
SECTION 3.5 THAN THE LENDER PROPOSING TO MAKE SUCH ASSIGNMENT WOULD HAVE
RECEIVED HAD IT RETAINED SUCH INTEREST FOR ITS OWN ACCOUNT.

 

13.3.3      EFFECT; EFFECTIVE DATE.  UPON (A) DELIVERY TO THE ADMINISTRATIVE
AGENT OF AN ASSIGNMENT, TOGETHER WITH ANY CONSENTS REQUIRED BY SECTIONS 13.3.1
AND 13.3.2, AND (B) PAYMENT OF A $3,500 FEE BY THE ASSIGNOR OR THE ASSIGNEE TO
THE ADMINISTRATIVE AGENT FOR PROCESSING SUCH ASSIGNMENT (UNLESS SUCH FEE IS
WAIVED BY THE ADMINISTRATIVE AGENT), SUCH ASSIGNMENT SHALL BECOME EFFECTIVE ON
THE EFFECTIVE DATE SPECIFIED IN SUCH ASSIGNMENT.  THE ASSIGNMENT SHALL CONTAIN A
REPRESENTATION BY THE PURCHASER TO THE EFFECT THAT NONE OF THE CONSIDERATION
USED TO MAKE THE PURCHASE OF THE COMMITMENT AND LOANS UNDER THE APPLICABLE
ASSIGNMENT AGREEMENT CONSTITUTES “PLAN ASSETS” AS DEFINED UNDER ERISA AND THAT
THE RIGHTS AND INTERESTS OF THE PURCHASER IN AND UNDER THE LOAN DOCUMENTS WILL
NOT BE “PLAN ASSETS” UNDER ERISA.  ON AND AFTER THE EFFECTIVE DATE OF SUCH
ASSIGNMENT, SUCH PURCHASER SHALL FOR ALL PURPOSES BE A LENDER PARTY TO THIS
AGREEMENT AND ANY OTHER LOAN DOCUMENT EXECUTED BY OR ON BEHALF OF THE LENDERS
AND SHALL HAVE ALL THE RIGHTS AND OBLIGATIONS OF A LENDER UNDER THE LOAN
DOCUMENTS, TO THE SAME EXTENT AS IF IT WERE AN ORIGINAL PARTY THERETO, AND THE
TRANSFEROR LENDER SHALL BE RELEASED WITH RESPECT TO THE COMMITMENT AND
OUTSTANDING CREDIT EXPOSURE ASSIGNED TO SUCH PURCHASER WITHOUT ANY FURTHER
CONSENT OR ACTION BY THE BORROWER, THE LENDERS OR THE ADMINISTRATIVE AGENT.  IN
THE CASE OF AN ASSIGNMENT COVERING ALL OF THE ASSIGNING LENDER’S RIGHTS AND
OBLIGATIONS UNDER THIS AGREEMENT, SUCH LENDER SHALL CEASE TO BE A LENDER
HEREUNDER BUT SHALL CONTINUE TO BE ENTITLED TO THE BENEFITS

 

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OF, AND SUBJECT TO, THOSE PROVISIONS OF THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS WHICH SURVIVE PAYMENT OF THE OBLIGATIONS AND TERMINATION OF THE
APPLICABLE AGREEMENT.  ANY ASSIGNMENT OR TRANSFER BY A LENDER OF RIGHTS OR
OBLIGATIONS UNDER THIS AGREEMENT THAT DOES NOT COMPLY WITH THIS SECTION 13.3
SHALL BE TREATED FOR PURPOSES OF THIS AGREEMENT AS A SALE BY SUCH LENDER OF A
PARTICIPATION IN SUCH RIGHTS AND OBLIGATIONS IN ACCORDANCE WITH SECTION 13.2. 
UPON THE CONSUMMATION OF ANY ASSIGNMENT TO A PURCHASER PURSUANT TO THIS
SECTION 13.3.3, THE TRANSFEROR LENDER, THE ADMINISTRATIVE AGENT AND THE BORROWER
SHALL, IF THE TRANSFEROR LENDER OR THE PURCHASER DESIRES THAT ITS LOANS BE
EVIDENCED BY NOTES, MAKE APPROPRIATE ARRANGEMENTS SO THAT NEW NOTES OR, AS
APPROPRIATE, REPLACEMENT NOTES ARE ISSUED TO SUCH TRANSFEROR LENDER AND NEW
NOTES OR, AS APPROPRIATE, REPLACEMENT NOTES, ARE ISSUED TO SUCH PURCHASER, IN
EACH CASE IN PRINCIPAL AMOUNTS REFLECTING THEIR RESPECTIVE COMMITMENTS, AS
ADJUSTED PURSUANT TO SUCH ASSIGNMENT.

 

13.3.4      REGISTER.  THE ADMINISTRATIVE AGENT, ACTING SOLELY FOR THIS PURPOSE
AS AN AGENT OF THE BORROWER, SHALL MAINTAIN AT ONE OF ITS OFFICES IN CHICAGO,
ILLINOIS A COPY OF EACH ASSIGNMENT AND ASSUMPTION DELIVERED TO IT AND A REGISTER
FOR THE RECORDATION OF THE NAMES AND ADDRESSES OF THE LENDERS, AND THE
COMMITMENTS OF, AND PRINCIPAL AMOUNTS OF THE LOANS 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 AND
THE LENDERS MAY TREAT EACH PERSON WHOSE NAME IS RECORDED IN THE REGISTER
PURSUANT TO THE TERMS HEREOF AS A LENDER HEREUNDER FOR ALL PURPOSES OF THIS
AGREEMENT, NOTWITHSTANDING NOTICE TO THE CONTRARY.  THE REGISTER SHALL BE
AVAILABLE FOR INSPECTION BY THE BORROWER AT ANY REASONABLE TIME AND FROM TIME TO
TIME UPON REASONABLE PRIOR NOTICE.

 

13.4         DISSEMINATION OF INFORMATION.  THE BORROWER AUTHORIZES EACH LENDER
TO DISCLOSE TO ANY PARTICIPANT OR PURCHASER OR ANY OTHER PERSON ACQUIRING AN
INTEREST IN THE LOAN DOCUMENTS BY OPERATION OF LAW (EACH A “TRANSFEREE”) AND ANY
PROSPECTIVE TRANSFEREE ANY AND ALL INFORMATION IN SUCH LENDER’S POSSESSION
CONCERNING THE CREDITWORTHINESS OF THE BORROWER AND ITS SUBSIDIARIES, INCLUDING
WITHOUT LIMITATION ANY INFORMATION CONTAINED IN ANY REPORTS; PROVIDED THAT EACH
TRANSFEREE AND PROSPECTIVE TRANSFEREE AGREES TO BE BOUND BY SECTION 10.11 OF
THIS AGREEMENT.

 

13.5         TAX TREATMENT.  IF ANY INTEREST IN ANY LOAN DOCUMENT IS TRANSFERRED
TO ANY TRANSFEREE WHICH IS NOT INCORPORATED UNDER THE LAWS OF THE UNITED STATES
OR ANY STATE THEREOF, THE TRANSFEROR LENDER SHALL CAUSE SUCH TRANSFEREE,
CONCURRENTLY WITH THE EFFECTIVENESS OF SUCH TRANSFER, TO COMPLY WITH THE
PROVISIONS OF SECTION 3.5(D).

 

ARTICLE XIV

NOTICES

 

14.1         NOTICES; EFFECTIVENESS; ELECTRONIC COMMUNICATION.

 

(A)           NOTICES GENERALLY.  EXCEPT IN THE CASE OF NOTICES AND OTHER
COMMUNICATIONS EXPRESSLY PERMITTED TO BE GIVEN BY TELEPHONE (AND EXCEPT AS
PROVIDED IN 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 TELECOPIER AS
FOLLOWS:

 

(I)            IF TO THE BORROWER, AT ITS ADDRESS OR TELECOPIER NUMBER SET FORTH
ON THE SIGNATURE PAGE HEREOF;

 

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(II)           IF TO THE ADMINISTRATIVE AGENT, AT ITS ADDRESS OR TELECOPIER
NUMBER SET FORTH ON THE SIGNATURE PAGE HEREOF;

 

(III)          IF TO THE LC ISSUER, AT ITS ADDRESS OR TELECOPIER NUMBER SET
FORTH, IN THE CASE OF BANK ONE, ON THE SIGNATURE PAGE HEREOF OR, IN THE CASE OF
ANY OTHER LC ISSUER, AT ITS ADDRESS OR TELECOPIER NUMBER PROVIDED TO THE
BORROWER;

 

(IV)          IF TO A LENDER, TO IT AT ITS ADDRESS OR TELECOPIER NUMBER SET
FORTH IN ITS ADMINISTRATIVE QUESTIONNAIRE.

 

Notices sent by hand or overnight courier service shall be deemed to have been
given when delivered; notices mailed by certified or registered mail shall be
deemed to have been given three (3) Business Days after being deposited in the
mail; notices sent by telecopier shall be deemed to have been given when sent
(except that, if not given during normal business hours for the recipient, shall
be deemed to have been given at the opening of business on the next Business Day
for the recipient).  Notices delivered through electronic communications to the
extent provided in paragraph (b) below, shall be effective as provided in said
paragraph (b).

 

(B)           ELECTRONIC COMMUNICATIONS.  NOTICES AND OTHER COMMUNICATIONS TO
THE LENDERS AND THE LC ISSUER HEREUNDER MAY BE DELIVERED OR FURNISHED BY
ELECTRONIC COMMUNICATION (INCLUDING E-MAIL AND INTERNET OR INTRANET WEBSITES)
PURSUANT TO PROCEDURES APPROVED BY THE ADMINISTRATIVE AGENT OR AS OTHERWISE
DETERMINED BY THE ADMINISTRATIVE AGENT,  PROVIDED THAT THE FOREGOING SHALL NOT
APPLY TO NOTICES TO ANY LENDER OR THE LC ISSUER PURSUANT TO ARTICLE II IF SUCH
LENDER OR THE LC ISSUER, AS APPLICABLE, HAS NOTIFIED THE ADMINISTRATIVE AGENT
THAT IT IS INCAPABLE OF RECEIVING NOTICES UNDER SUCH ARTICLE BY ELECTRONIC
COMMUNICATION.  THE ADMINISTRATIVE AGENT OR THE BORROWER MAY, IN ITS RESPECTIVE
DISCRETION, AGREE TO ACCEPT NOTICES AND OTHER COMMUNICATIONS TO IT HEREUNDER BY
ELECTRONIC COMMUNICATIONS PURSUANT TO PROCEDURES APPROVED BY IT OR AS IT
OTHERWISE DETERMINES; PROVIDED THAT SUCH DETERMINATION OR APPROVAL MAY BE
LIMITED TO PARTICULAR NOTICES OR COMMUNICATIONS.

 

Unless the Administrative Agent otherwise prescribes, (i) notices and other
communications 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 such notice or other communication is
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) notices or communications
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 (i) of notification that such notice or communication is
available and identifying the website address therefor.

 

(C)           CHANGE OF ADDRESS, ETC.  ANY PARTY HERETO MAY CHANGE ITS ADDRESS
OR TELECOPIER NUMBER FOR NOTICES AND OTHER COMMUNICATIONS HEREUNDER BY NOTICE TO
THE OTHER PARTIES HERETO.

 

ARTICLE XV

COUNTERPARTS; INTEGRATION; EFFECTIVENESS; ELECTRONIC EXECUTION

 

15.1         COUNTERPARTS; EFFECTIVENESS.  THIS AGREEMENT MAY BE EXECUTED IN
COUNTERPARTS (AND BY DIFFERENT PARTIES HERETO IN DIFFERENT COUNTERPARTS), EACH
OF WHICH SHALL CONSTITUTE AN ORIGINAL, BUT ALL OF

 

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WHICH WHEN TAKEN TOGETHER SHALL CONSTITUTE A SINGLE CONTRACT.  EXCEPT AS
PROVIDED IN ARTICLE IV, 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 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 TELECOPY SHALL BE EFFECTIVE AS DELIVERY OF A MANUALLY EXECUTED
COUNTERPART OF THIS AGREEMENT.

 

15.2         ELECTRONIC EXECUTION OF ASSIGNMENTS.  THE WORDS “EXECUTION,”
“SIGNED,” “SIGNATURE,” AND WORDS OF LIKE IMPORT IN ANY ASSIGNMENT AND ASSUMPTION
AGREEMENT SHALL BE DEEMED TO INCLUDE ELECTRONIC SIGNATURES OR THE KEEPING OF
RECORDS IN ELECTRONIC FORM, EACH OF WHICH SHALL BE OF THE SAME LEGAL EFFECT,
VALIDITY OR ENFORCEABILITY AS A MANUALLY EXECUTED SIGNATURE OR THE USE OF A
PAPER-BASED RECORDKEEPING SYSTEM, AS THE CASE MAY BE, TO THE EXTENT AND AS
PROVIDED FOR IN ANY APPLICABLE LAW, INCLUDING THE FEDERAL ELECTRONIC SIGNATURES
IN GLOBAL AND NATIONAL COMMERCE ACT, OR ANY OTHER STATE LAWS BASED ON THE
UNIFORM ELECTRONIC TRANSACTIONS ACT.

 

ARTICLE XVI

 

CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

 

16.1         CHOICE OF LAW.  THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS.

 

16.2         CONSENT TO JURISDICTION.  THE BORROWER HEREBY IRREVOCABLY SUBMITS
TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE
COURT SITTING IN NEW YORK, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES
THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR
HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN
SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.  NOTHING HEREIN SHALL
LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT, THE LC ISSUER OR ANY LENDER TO
BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. 
ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE ADMINISTRATIVE AGENT, THE LC
ISSUER OR ANY LENDER OR ANY AFFILIATE OF THE ADMINISTRATIVE AGENT, THE LC ISSUER
OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING
OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN
A COURT IN NEW YORK, NEW YORK.

 

16.3         WAIVER OF JURY TRIAL.  THE BORROWER, THE ADMINISTRATIVE AGENT, THE
LC ISSUER AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT,
CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH
ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.

 

[signature pages follow]

 

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IN WITNESS WHEREOF, the Borrower, the Lenders and the Administrative Agent, the
LC Issuer and the Swing Line Lender have executed this Agreement as of the date
first above written.

 

 

DEPARTMENT 56, INC.

 

 

 

 

 

 

By:

/s/ Timothy Schugel

 

 

Title: 

Executive Vice President and CFO

 

 

 

 

1 Village Place

 

6436 City West Parkway

 

Eden Prairie, Minnesota 55344

 

 

 

Attention:

Timothy Schugel

 

Telecopy:

(952) 943-4490

 

Telephone:

(952) 943-4513

 

 

 

BANK ONE, NA,

 

Individually, as Administrative Agent, as LC
Issuer and as Swing Line Lender

 

 

 

By:

/s/ Anthony W. Bartell

 

 

Title

Vice President

 

 

 

 

Mail Code WI1-2032

 

111 East Wisconsin Avenue

 

Milwaukee, Wisconsin 53202

 

 

 

Attention:

Anthony Bartell

 

Telecopy:

(414) 765-2288

 

Telephone:

(414) 765-2654

 

Signature Page to Credit Agreement

 

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

 

 

U.S. BANK NATIONAL ASSOCIATION, as a
Lender

 

 

 

 

 

By:

/s/ Michael J. Reymann

 

 

Title:

Vice President

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Credit Agreement

 

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

 

 

 

WELLS FARGO BANK, N.A., as a Lender

 

 

 

 

 

By:

/s/ Sharlyn Rekenthaler

 

 

Title:

Vice President

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Credit Agreement

 

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MERRILL LYNCH BUSINESS FINANCIAL
SERVICES INC., as a Lender

 

 

 

 

 

By:

/s/ Randall R. Meck

 

 

Title:

Vice President

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Credit Agreement

 

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COMMITMENT SCHEDULE

 

Lender

 

Commitment

 

Bank One, NA

 

$

30,000,000

 

U.S. Bank National Association

 

$

25,000,000

 

Wells Fargo Bank, N.A.

 

$

25,000,000

 

Merrill Lynch Business Financial
Services Inc.

 

$

20,000,000

 

 

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

 

PRICING SCHEDULE

 

APPLICABLE
MARGIN

 

LEVEL I STATUS

 

LEVEL II
STATUS

 

LEVEL III
STATUS

 

LEVEL IV
STATUS

 

Eurodollar Rate

 

.875

%

1.00

%

1.125

%

1.25

%

 

 

 

 

 

 

 

 

 

 

Floating Rate

 

0

%

.125

%

.25

%

.375

%

 

APPLICABLE FEE
RATE

 

LEVEL I STATUS

 

LEVEL II
STATUS

 

LEVEL III
STATUS

 

LEVEL IV
STATUS

 

Standby Letter of Credit Fee

 

.875

%

1.00

%

1.125

%

1.25

%

 

 

 

 

 

 

 

 

 

 

Commercial Letter of Credit Fee

 

.50

%

.50

%

.563

%

.625

%

 

 

 

 

 

 

 

 

 

 

Commitment Fee

 

.20

%

.25

%

.25

%

.375

%

 

For the purposes of this Schedule, the following terms have the following
meanings, subject to the final paragraph of this Schedule:

 

“Financials” means the annual or quarterly financial statements of the Borrower
delivered pursuant to Section 6.1(a) or (b).

 

“Level I Status” exists at any date if, as of the last day of the fiscal quarter
of the Borrower referred to in the most recent Financials, the Leverage Ratio is
less than or equal to 1.0 to 1.00.

 

“Level II Status” exists at any date if, as of the last day of the fiscal
quarter of the Borrower referred to in the most recent Financials, (a) the
Borrower has not qualified for Level I Status and (b) the Leverage Ratio is less
than or equal to 1.5 to 1.00.

 

“Level III Status” exists at any date if, as of the last day of the fiscal
quarter of the Borrower referred to in the most recent Financials, (a) the
Borrower has not qualified for Level I Status or Level II Status and (b) the
Leverage Ratio is less than or equal to 2.0 to 1.00.

 

“Level IV Status” exists at any date if the Borrower has not qualified for Level
I Status, Level II Status or Level III Status.

 

“Status” means either Level I Status, Level II Status, Level III Status or Level
IV Status.

 

The Applicable Margin and Applicable Fee Rate shall be determined in accordance
with the foregoing table based on the Borrower’s Status as reflected in the then
most recent Financials; provided that the initial Applicable Margin and
Applicable Fee Rate shall be based on Level II Status until the date on which
the Financials are required to be delivered for the fiscal year ending
January 3, 2004.  Adjustments, if any, to the Applicable Margin or Applicable
Fee Rate shall be effective five Business Days after the Administrative Agent
has received the applicable Financials.  If the Borrower fails to deliver the
Financials to the Administrative Agent at the time required pursuant to
Section 6.1, then the Applicable Margin and

 

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

 

Applicable Fee Rate shall be the highest Applicable Margin and Applicable Fee
Rate set forth in the foregoing table until five days after such Financials are
so delivered.

 

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EXHIBIT A

 

FORM OF BORROWING BASE CERTIFICATE

[Date]

 

This Borrowing Base Certificate is furnished pursuant to that certain Credit
Agreement dated as of November 25, 2003 (as amended, modified, renewed or
extended from time to time, the “Agreement”) among the Department 56, Inc. (the
“Borrower”), the lenders party thereto and Bank One, NA, as Administrative Agent
for the Lenders.  Unless otherwise defined herein, capitalized terms used in
this Borrowing Base Certificate shall have the meanings ascribed thereto in the
Agreement.

 

The undersigned hereby certifies that the following computation of the Borrowing
Base is true and correct as of                      .

 

 

 

 

 

(000’s Omitted)

 

1. Accounts

 

 

 

 

 

 

(a)

net outstanding Accounts of the Borrower and its Subsidiaries

 

$

 

 

 

(b)

minus ineligible Accounts [1]

 

 

 

 

(c)

equals total Eligible Accounts

 

 

 

 

(d)

multiplied by

 

80

%

 

(e)

equals

 

$

 

 

 

 

 

 

 

 

2. Inventory

 

 

 

 

 

 

(a)

total Inventory of the Borrower and its Subsidiaries

 

$

 

 

 

(b)

minus ineligible Inventory [2]

 

 

 

 

(c)

equals total Eligible Inventory

 

 

 

 

(d)

multiplied by

 

50

%

 

(e)

equals

 

$

 

 

 

 

 

 

 

 

3. Borrowing Base

 

 

 

 

 

 

(a)

the sum of

 

 

 

 

 

(i)

Item 1(e)

 

$

 

 

 

 

(ii)

Item 2(e)

 

 

 

 

 

equals available for the Borrowing Base

 

$

 

 

 

 

 

 

 

 

 

(b)

Borrowing Base (min $30,000, max $100,000)

 

$

 

 

 

 

 

 

 

 

4. Outstanding Credit Extensions

 

 

 

 

 

 

(a)

the sum of

 

 

 

 

 

(i)

Revolving Loans

 

$

 

 

 

 

(ii)

Outstanding Facility LCs

 

 

 

 

 

(ii)

Swing Line Loans

 

 

 

 

(b)

equals

 

$

 

 

 

 

Department 56, Inc.

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

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

[1]           All outstanding Accounts of the Borrower and its Subsidiaries that
are not Eligible Accounts as of [                    ]

[2]           All Inventory of the Borrower and its Subsidiaries that is not
Eligible Inventory as of [                    ].

 

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

 

EXHIBIT B

 

FORM OF COMPLIANCE CERTIFICATE

 

To:                              The Lenders parties to the

Credit Agreement Described Below

 

This Compliance Certificate is furnished pursuant to that certain Credit
Agreement dated as of November 25, 2003 (as amended, modified, renewed or
extended from time to time, the “Agreement”) among Department 56, Inc. (the
“Borrower”), the lenders party thereto and Bank One, NA, as Administrative Agent
for the Lenders.  Unless otherwise defined herein, capitalized terms used in
this Compliance Certificate have the meanings ascribed thereto in the Agreement.

 

THE UNDERSIGNED HEREBY CERTIFIES THAT:

 

1.  I am the duly elected                 of the Borrower;

 

2.  I have reviewed the terms of the Agreement and I have made, or have caused
to be made under my supervision, a detailed review of the transactions and
conditions of the Borrower and its Subsidiaries during the accounting period
covered by the attached financial statements;

 

3.  The examinations described in paragraph 2 did not disclose, and I have no
knowledge of, the existence of any condition or event which constitutes a
Default or Unmatured Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate, except as set forth below; and

 

4.  Schedule I attached hereto sets forth financial data and computations
evidencing the Borrower’s compliance with certain covenants of the Agreement,
all of which data and computations are true, complete and correct.

 

5. Schedule II attached hereto sets forth the various reports and deliveries
which are required at this time under the Credit Agreement, the Collateral
Documents and the other Loan Documents and the status of compliance.

 

Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:

 

 

 

 

 

 

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

 

The foregoing certifications, together with the computations set forth in
Schedule I and Schedule II hereto and the financial statements delivered with
this Certificate in support hereof, are made and delivered this       day
of          ,          .

 

 

 

 

 

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

 

SCHEDULE I TO COMPLIANCE CERTIFICATE

 

Compliance as of          ,         with
provisions of Sections 7.1(a), (b) and (c) of
the Agreement

 

Consolidated Interest Coverage Ratio
Section 7.1(a)
As of [                   ] ($000’s)

 

 

 

12 Months Ended
[              ]

 

 

 

 

 

Consolidated EBITDA:

 

 

 

Net Income

 

$

 

 

Income Tax Expense

 

 

 

Interest Expense

 

 

 

Depreciation

 

 

 

Amortization

 

 

 

Loss on Sale of Assets

 

 

 

Consolidated EBITDA

 

$

 

 

 

 

 

 

Consolidated Interest Expense:

 

 

 

Interest Expense

 

$

 

 

 

 

 

 

Consolidated Interest Coverage Ratio

 

 

 

 

 

 

 

Minimum Required

 

4.00

 

 

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

 

Consolidated Leverage Ratio
Section 7.1(b)
As of [                            ] ($000’s)

 

 

 

12 Months Ended
[              ]

 

 

 

 

 

Consolidated Total Debt:

 

 

 

Credit Extensions (average daily amount of outstanding Credit Extensions for 12
month period ended)

 

$

 

 

Capital Lease Obligations

 

 

 

Other Indebtedness

 

 

 

Consolidated Total Debt

 

 

 

 

 

 

 

Consolidated EBITDA:

 

 

 

 

 

 

 

Net Income

 

$

 

 

Income Tax Expense

 

 

 

Interest Expense

 

 

 

Depreciation

 

 

 

Amortization

 

 

 

Loss on Sale of Assets

 

 

 

Consolidated EBITDA

 

 

 

 

 

 

 

Consolidated Leverage Ratio

 

 

 

 

 

 

 

Maximum Allowed

 

2.75

 

 

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

 

Consolidated Net Worth
Section 7.1(c)
As of [                           ] ($000’s)

 

 

 

12 Months Ended
[              ]

 

 

 

 

 

Consolidated Net Worth

 

$

 

 

 

 

 

 

Minimum Required

 

$

 

1

 

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

1 Greater of (i) $80,000,000 or (ii) 75% of Consolidated Net Worth as of October
4, 2003

 

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

 

SCHEDULE II TO COMPLIANCE CERTIFICATE

 

Reports and Deliveries Currently Due

 

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

 

EXHIBIT C

 

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT

 

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the
“Assignee”).  Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
“Credit Agreement”), receipt of a copy of which is hereby acknowledged by the
Assignee.  The Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Terms and Conditions and the
Credit Agreement, as of the Effective Date inserted by the Administrative Agent
as contemplated below, the interest in and to all of the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement and any other
documents or instruments delivered pursuant thereto that represents the amount
and percentage interest identified below of all of the Assignor’s outstanding
rights and obligations under the respective facilities identified below
(including without limitation any letters of credit, guaranties and swingline
loans included in such facilities and, to the extent permitted to be assigned
under applicable law, all claims (including without limitation contract claims,
tort claims, malpractice claims, statutory claims and all other claims at law or
in equity), suits, causes of action and any other right of the Assignor against
any Person whether known or unknown arising under or in connection with the
Credit Agreement, any other documents or instruments delivered pursuant thereto
or the loan transactions governed thereby) (the “Assigned Interest”).  Such sale
and assignment is without recourse to the Assignor and, except as expressly
provided in this Assignment and Assumption, without representation or warranty
by the Assignor.

 

1.                                      
Assignor:                                          
                                                                                                         

 

2.                                      
Assignee:                                         
                                                                   [and is an
Affiliate/Approved

Fund of [identify Lender]1

 

3.                                      
Borrower(s):                             
                                                                                                                   

 

4.

Administrative Agent:

Bank One, NA, as the administrative agent under the Credit Agreement.

 

 

 

5.

Credit Agreement:

The Credit Agreement dated as of November 25, 2003 among
Department 56, Inc., the Lenders party thereto, Bank One, NA, as Administrative
Agent, and the other agents party thereto.

 

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

1  Select as applicable.

 

6.                                       Assigned Interest:

               

Aggregate Amount of
Commitment/Loans for
all Lenders*

 

Amount of
Commitment/Loans
Assigned*

 

Percentage Assigned of
Commitment/Loans(2)

 

$

 

 

$

 

 

 

%

$

 

 

$

 

 

 

%

$

 

 

$

 

 

 

%

 

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

 

7.                                       Trade
Date:                                 
                                                                       3

 

Effective Date:                                             ,
20                      [TO BE INSERTED BY AGENT AND WHICH SHALL BE THE
EFFECTIVE DATE OF RECORDATION OF TRANSFER BY THE ADMINISTRATIVE AGENT.]

 

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

 

ASSIGNOR

 

[NAME OF ASSIGNOR]

 

 

 

By:

 

 

 

 

Title:

 

 

 

ASSIGNEE

 

[NAME OF ASSIGNEE]

 

 

 

By:

 

 

 

 

Title:

 

[Consented to and]4Accepted:

 

BANK ONE, NA, as Administrative Agent

 

By:

 

 

Title:

 

[Consented to:]5

 

DEPARTMENT 56, INC.

 

By:

 

 

Title:

 

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

*Amount to be adjusted by the counterparties to take into account any payments
or prepayments made between the Trade Date and the Effective Date.

2  Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

3  Insert if satisfaction of minimum amounts is to be determined as of the Trade
Date.

4  To be added only if the consent of the Administrative Agent is required by
the terms of the Credit Agreement.

5  To be added only if the consent of the Borrower and/or other parties (e.g.
Swingline Lender, L/C Issuer) is required by the terms of the Credit Agreement.

 

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

 

ANNEX 1

TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

 

1.  Representations and Warranties.

 

1.1   Assignor.  The Assignor represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby.  Neither the Assignor nor any of its officers, directors,
employees, agents or attorneys shall be responsible for (i) any statements,
warranties or representations made in or in connection with the Credit Agreement
or any other Loan Document, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency, perfection, priority, collectibility,
or value of the Loan Documents or any collateral thereunder, (iii) the financial
condition of the Borrower, any of its Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document, (iv) the performance or
observance by the Borrower, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Documents, (v)
inspecting any of the property, books or records of the Borrower, or any
guarantor, or (vi) any mistake, error of judgment, or action taken or omitted to
be taken in connection with the Loans or the Loan Documents.

 

1.2.  Assignee.  The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) from and after
the Effective Date, it shall be bound by the provisions of the Credit Agreement
as a Lender thereunder and, to the extent of the Assigned Interest, shall have
the obligations of a Lender thereunder, (iii) agrees that its payment
instructions and notice instructions are as set forth in Schedule 1 to this
Assignment and Assumption, (iv) confirms that none of the funds, monies, assets
or other consideration being used to make the purchase and assumption hereunder
are “plan assets” as defined under ERISA and that its rights, benefits and
interests in and under the Loan Documents will not be “plan assets” under ERISA,
(v) agrees to indemnify and hold the Assignor harmless against all losses, costs
and expenses (including, without limitation, reasonable attorneys’ fees) and
liabilities incurred by the Assignor in connection with or arising in any manner
from the Assignee’s non-performance of the obligations assumed under this
Assignment and Assumption, (vi) it has received a copy of  the Credit Agreement,
together with copies of financial statements and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Assumption and to purchase the
Assigned Interest on the basis of which it has made such analysis and decision
independently and without reliance on the Administrative Agent or any other
Lender, and (vii) attached as Schedule 1 to this Assignment and Assumption is
any documentation required to be delivered by the Assignee with respect to its
tax status pursuant to the terms of the Credit Agreement, duly completed and
executed by the Assignee and (b) agrees that (i) it will, independently and
without reliance on the Administrative Agent, the Assignor or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.

 

2.   Payments.    The Assignee shall pay the Assignor, on the Effective Date,
the amount agreed to by the Assignor and the Assignee.  From and after the
Effective Date, the Administrative Agent shall make all payments in respect of
the Assigned Interest (including payments of principal, interest, fees

 

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

 

and other amounts) to the Assignor for amounts which have accrued to but
excluding the Effective Date and to the Assignee for amounts which have accrued
from and after the Effective Date.

 

3.  General Provisions. This Assignment and Assumption shall be binding upon,
and inure to the benefit of, the parties hereto and their respective successors
and assigns.  This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument.  Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption.  This Assignment and Assumption shall be
governed by, and construed in accordance with, the law of the State of New York.

 

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

 

ADMINISTRATIVE QUESTIONNAIRE

 

(Schedule to be supplied by Closing Unit or Trading Documentation Unit)

 

(For Forms for Primary Syndication call Peterine Svoboda at 312-732-8844)

(For Forms after Primary Syndication call Jim Bartz at 312-732-1242)

 

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

 

US AND NON-US TAX INFORMATION REPORTING REQUIREMENTS

 

(Schedule to be supplied by Closing Unit or Trading Documentation Unit)

 

(For Forms for Primary Syndication call Peterine Svoboda at 312-732-8844)

(For Forms after Primary Syndication call Jim Bartz at 312-732-1242)

 

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

 

EXHIBIT D

 

LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION

 

To Bank One, NA,

as Administrative Agent (the “Administrative Agent”) under the Credit Agreement

Described Below.

 

Re:                               Credit Agreement, dated as of November 25,
2003 (as the same may be amended or modified, the “Credit Agreement”), among
Department 56, Inc. (the “Borrower”), the Lenders named therein and the
Administrative Agent.  Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned thereto in the Credit Agreement.

 

The Administrative Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Advances or other extensions of credit from time to time until receipt by the
Administrative Agent of a specific written revocation of such instructions by
the Borrower; provided, however, that the Administrative Agent may otherwise
transfer funds as hereafter directed in writing by the Borrower in accordance
with Section 14.1 of the Credit Agreement or based on any telephonic notice made
in accordance with Section 2.14 of the Credit Agreement.

 

Facility Identification Number(s)
                                                                                                                         

 

Customer/Account Name
                                                                                                                                     

 

Transfer Funds To
                                                                                                                                                

 

                                                                                                                                                 

 

For Account No.
                                                                                                                                                   

 

Reference/Attention To
                                                                                                                                        

 

Authorized Officer (Customer Representative)

 

Date

 

 

 

 

 

 

 

 

 

 

(Please Print)

 

Signature

 

 

 

Bank Officer Name

 

Date

 

 

 

 

 

 

 

 

 

 

(Please Print)

 

Signature

 

(Deliver Completed Form to Credit Support Staff For Immediate Processing)

 

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

 

EXHIBIT E

 

FORM OF NOTE

 

 

[Date]

 

Department 56, Inc., a Delaware corporation (the “Borrower”), promises to pay to
the order of                                             (the “Lender”) the
aggregate unpaid principal amount of all Loans made by the Lender to the
Borrower pursuant to Article II of the Agreement (as hereinafter defined), in
immediately available funds at the main office of Bank One, NA in Chicago,
Illinois, as Administrative Agent, together with interest on the unpaid
principal amount hereof at the rates and on the dates set forth in the
Agreement.  The Borrower shall pay the principal of and accrued and unpaid
interest on the Loans in full on the Facility Termination Date.

 

The Lender shall, and is hereby authorized to, record on the schedule attached
hereto, or to otherwise record in accordance with its usual practice, the date
and amount of each Loan and the date and amount of each principal payment
hereunder.

 

This Note is one of the Notes issued pursuant to, and is entitled to the
benefits of, the Credit Agreement dated as of November 25, 2003 (which, as it
may be amended or modified and in effect from time to time, is herein called the
“Agreement”), among the Borrower, the lenders party thereto, including the
Lender, and Bank One, NA, as Administrative Agent, to which Agreement reference
is hereby made for a statement of the terms and conditions governing this Note,
including the terms and conditions under which this Note may be prepaid or its
maturity date accelerated.  This Note is secured pursuant to the Collateral
Documents, all as more specifically described in the Agreement, and reference is
made thereto for a statement of the terms and provisions thereof.  Capitalized
terms used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.

 

 

 

DEPARTMENT 56, INC.

 

 

 

 

 

By:

 

 

 

Print Name:

 

 

 

Title:

 

 

 

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

 

SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL

TO

NOTE OF DEPARTMENT 56, INC.,

DATED                    ,

 

Date

 

Principal
Amount of
Loan

 

Maturity
of Interest
Period

 

Principal
Amount
Paid

 

Unpaid
Balance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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