EXHIBIT 10.1
[EXECUTION]
LOAN AND SECURITY AGREEMENT
by and among
ASSOCIATED MATERIALS, LLC
GENTEK BUILDING PRODUCTS, INC.
as US Borrowers
and
GENTEK BUILDING PRODUCTS LIMITED
as Canadian Borrower
ASSOCIATED MATERIALS HOLDINGS, LLC
GENTEK HOLDINGS, LLC
ALSIDE, INC.
as Guarantors
THE LENDERS AND ISSUING BANK FROM TIME TO TIME PARTY HERETO
WACHOVIA BANK, NATIONAL ASSOCIATION
as Administrative and Collateral Agent
WACHOVIA CAPITAL MARKETS, LLC
CIT CAPITAL SECURITIES, LLC
as Joint Lead Arrangers and Joint Lead Bookrunners
THE CIT GROUP/BUSINESS CREDIT, INC.
as Syndication Agent
Dated: October 3, 2008

 

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TABLE OF CONTENTS

             
SECTION 1.
  DEFINITIONS     1  
 
           
SECTION 2.
  CREDIT FACILITIES     46  
2.1
  Revolving Loans     46  
2.2
  Swing Line Loans     46  
2.3
  Letters of Credit     47  
2.4
  Requests for Borrowings     54  
2.5
  Prepayments     55  
2.6
  Increases and Decreases in Maximum Credit     55  
2.7
  Joint and Several Liability of US Borrowers     57  
2.8
  Joint and Several Liability of Canadian Borrowers     59  
2.9
  Commitments     61  
 
           
SECTION 3.
  INTEREST AND FEES     62  
3.1
  Interest     62  
3.2
  Fees     64  
3.3
  Inability to Determine Applicable Interest Rate     65  
3.4
  Illegality     66  
3.5
  Increased Costs     66  
3.6
  Capital Requirements     66  
3.7
  Certificates for Reimbursement     67  
3.8
  Delay in Requests     67  
3.9
  Mitigation; Replacement of Lenders     67  
3.10
  Funding Losses     68  
3.11
  Maximum Interest     68  
3.12
  No Requirement of Match Funding     68  
 
           
SECTION 4.
  CONDITIONS PRECEDENT     68  
4.1
  Conditions Precedent to Initial Loans and Letters of Credit     68  
4.2
  Conditions Precedent to All Loans and Letters of Credit     71  
4.3
  Conditions Precedent to Real Property Availability     72  
 
           
SECTION 5.
  GRANT AND PERFECTION OF SECURITY INTEREST     73  
5.1
  Grant of Security Interest     73  
5.2
  Perfection of Security Interests     74  
5.3
  Special Provisions Relating to Collateral     78  
 
           
SECTION 6.
  COLLECTION AND ADMINISTRATION     78  
6.1
  Borrowers’ Loan Accounts     78  
6.2
  Statements     79  
6.3
  Lenders’ Evidence of Debt     79  

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6.4
  Register     79  
6.5
  Promissory Notes     80  
6.6
  Cash Management; Collection of Proceeds of Collateral     80  
6.7
  Payments     81  
6.8
  Taxes     84  
6.9
  Use of Proceeds     86  
6.10
  Appointment of Administrative Borrower as Agent for Requesting Loans and
Receipts of Loans and Statements     86  
6.11
  Pro Rata Treatment     87  
6.12
  Sharing of Payments, Etc.     87  
6.13
  Settlement Procedures     88  
6.14
  Obligations Several; Independent Nature of Lenders’ Rights     90  
6.15
  Bank Products     91  
 
           
SECTION 7.
  COLLATERAL REPORTING AND COVENANTS     91  
7.1
  Collateral Reporting     91  
7.2
  Accounts Covenants     93  
7.3
  Inventory Covenants     93  
7.4
  Equipment and Real Property Covenants     94  
7.5
  Power of Attorney     95  
7.6
  Right to Cure     96  
7.7
  Access to Premises     96  
 
           
SECTION 8.
  REPRESENTATIONS AND WARRANTIES     97  
8.1
  Existence, Power and Authority     97  
8.2
  Name; Jurisdiction of Organization; Chief Executive Office; Collateral
Locations     97  
8.3
  Financial Statements; No Material Adverse Effect     98  
8.4
  Priority of Liens; Title to Properties     98  
8.5
  Tax Returns     98  
8.6
  Litigation     98  
8.7
  Compliance with Other Agreements and Applicable Laws     99  
8.8
  Environmental Compliance     99  
8.9
  Employee Benefits     100  
8.10
  Bank Accounts     101  
8.11
  Intellectual Property     101  
8.12
  Subsidiaries; Affiliates; Capitalization; Solvency     102  
8.13
  Labor Disputes     102  
8.14
  Restrictions on Subsidiaries     102  
8.15
  Material Contracts; Affiliate Indebtedness     103  
8.16
  Payable Practices     103  
8.17
  Accuracy and Completeness of Information     103  
8.18
  Survival of Warranties; Cumulative     103  
 
           
SECTION 9.
  AFFIRMATIVE COVENANTS     103  
9.1
  Maintenance of Existence     103  
9.2
  New Collateral Locations     104  
9.3
  Compliance with Laws, Regulations, Etc.     104  
9.4
  Payment of Taxes and Claims     105  

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9.5
  Insurance     105  
9.6
  Financial Statements and Other Information     106  
9.7
  Compliance with ERISA; Canadian Pension Plans     110  
9.8
  End of Fiscal Years; Fiscal Quarters     110  
9.9
  Additional Guaranties and Collateral Security; Further Assurances     111  
9.10
  Costs and Expenses     112  
9.11
  Applications under Insolvency Statutes     112  
9.12
  After Acquired Real Property     112  
 
           
SECTION 10.
  NEGATIVE COVENANTS     113  
10.1
  Sale of Assets, Consolidation, Merger, Dissolution, Etc.     113  
10.2
  Encumbrances     114  
10.3
  Indebtedness     117  
10.4
  Loans, Investments, Etc.     120  
10.5
  Restricted Payments     120  
10.6
  Transactions with Affiliates     122  
10.7
  Change in Business     122  
10.8
  Limitation of Restrictions Affecting Subsidiaries     123  
10.9
  Certain Payments of Indebtedness, Etc.     123  
10.10
  Modifications of Indebtedness, Organizational Documents and Certain Other
Agreements     124  
10.11
  Designation of Designated Senior Indebtedness     124  
10.12
  License Agreements     124  
10.13
  Foreign Assets Control Regulations, Etc.     125  
 
           
SECTION 11.
  FINANCIAL COVENANT     126  
11.1
  Fixed Charge Coverage Ratio     126  
 
           
SECTION 12.
  EVENTS OF DEFAULT AND REMEDIES     127  
12.1
  Events of Default     127  
12.2
  Remedies     129  
 
           
SECTION 13.
  JURY TRIAL WAIVER; OTHER WAIVERS AND CONSENTS; GOVERNING LAW     132  
13.1
  Governing Law; Choice of Forum; Service of Process; Jury Trial Waiver     132
 
13.2
  Waiver of Notices     133  
13.3
  Amendments and Waivers     134  
13.4
  Waiver of Counterclaims     136  
13.5
  Indemnification     136  
 
           
SECTION 14.
  THE AGENT     137  
14.1
  Appointment, Powers and Immunities     137  
14.2
  Appointment for the Province of Québec     137  
14.3
  Reliance by Agent     138  
14.4
  Events of Default     138  
14.5
  Wachovia in its Individual Capacity     139  
14.6
  Indemnification     139  

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14.7
  Non-Reliance on Agent and Other Lenders     139  
14.8
  Failure to Act     139  
14.9
  Additional Loans     140  
14.10
  Concerning the Collateral and the Related Loan Documents     140  
14.11
  Field Audit, Examination Reports and other Information; Disclaimer by Lenders
    140  
14.12
  Collateral Matters     140  
14.13
  Agency for Perfection     142  
14.14
  Successor Agent     142  
14.15
  Other Agent Designations     143  
 
           
SECTION 15.
  TERM OF AGREEMENT; MISCELLANEOUS     143  
15.1
  Term     143  
15.2
  Interpretative Provisions     144  
15.3
  Notices     145  
15.4
  Partial Invalidity     146  
15.5
  Confidentiality     146  
15.6
  Successors     147  
15.7
  Assignments; Participations     148  
15.8
  Entire Agreement     150  
15.9
  USA Patriot Act     150  
15.10
  Counterparts, Etc.     150  
15.11
  Judgment Currency     150  

(iv)

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INDEX
TO
EXHIBITS AND SCHEDULES

     
Exhibit A
  Form of Assignment and Acceptance
Exhibit B
  Borrowing Base Certificate
Exhibit C
  Information Certificate
Exhibit D
  Form of Solvency Certificate
Exhibit E
  Form of Compliance Certificate
Schedule 1.57
  EBITDA
Schedule 1.85
  Existing Letters of Credit
Schedule 6.6(b)
  Certain Cash Management Accounts

(v)

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LOAN AND SECURITY AGREEMENT
     This Loan and Security Agreement (this “Agreement”) dated October 3, 2008
is entered into by and among Associated Materials, LLC, a Delaware limited
liability company (“Associated”), Gentek Building Products, Inc., a Delaware
corporation (“Gentek” and, together with Associated, each individually a “US
Borrower” and collectively, “US Borrowers” as hereinafter further defined),
Gentek Building Products Limited, a corporation incorporated under the laws of
the Province of Ontario, Canada (“Canadian Borrower” as hereinafter further
defined and, together with US Borrowers, each individually a “Borrower” and
collectively, “Borrowers” as hereinafter further defined), Associated Materials
Holdings, LLC, a Delaware limited liability company (“Associated Holdings”),
Gentek Holdings, LLC, a Delaware limited liability company (“Gentek”) and
Alside, Inc., a Delaware corporation (“Alside” and, together with Gentek and
Associated Holdings, each individually a “Guarantor” and collectively,
“Guarantors” as hereinafter further defined), the parties hereto from time to
time as lenders, whether by execution of this Agreement or an Assignment and
Acceptance (each individually, a “Lender” and collectively, “Lenders” as
hereinafter further defined) and Wachovia Bank, National Association , a
national banking association, in its capacity as agent for Issuing Bank and
Lenders (in such capacity, “Agent” as hereinafter further defined).
WITNESSETH:
     WHEREAS, Borrowers and Guarantors have requested that Agent, Issuing Bank
and Lenders enter into financing arrangements with Borrowers pursuant to which
Lenders may make loans and provide other financial accommodations to Borrowers;
and
     WHEREAS, Issuing Bank and each Lender are willing to agree (severally and
not jointly) to make such loans and provide such financial accommodations to
Borrowers on a pro rata basis according to its Commitment (as defined below) on
the terms and conditions set forth herein and Agent is willing to act as agent
for Issuing Bank and Lenders on the terms and conditions set forth herein and
the other Loan Documents;
     NOW, THEREFORE, in consideration of the mutual conditions and agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
SECTION 1. DEFINITIONS
     For purposes of this Agreement, the following terms shall have the
respective meanings given to them below:
     1.1 “Accounts” shall mean, as to each Borrower and Guarantor, all present
and future rights of such Borrower and Guarantor to payment of a monetary
obligation, whether or not earned by performance, which is not evidenced by
chattel paper or an instrument, (a) for property that has been or is to be sold,
leased, licensed, assigned, or otherwise disposed of, (b) for services rendered
or to be rendered, (c) for a secondary obligation incurred or to be incurred, or
(d) arising out of the use of a credit or charge card or information contained
on or for use with the card.
     1.2 “Adjusted Eurodollar Rate” shall mean, with respect to each Interest
Period for any Eurodollar Rate Loan comprising part of the same borrowing
(including conversions, extensions and renewals), the rate per annum determined
by dividing (a) the London Interbank Offered Rate for such Interest Period by
(b) a percentage equal to: (i) one (1) minus (ii) the Reserve Percentage. For
purposes

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hereof, “Reserve Percentage” shall mean for any day, that percentage (expressed
as a decimal) which is in effect from time to time under Regulation D of the
Board of Governors of the Federal Reserve System (or any successor), as such
regulation may be amended from time to time or any successor regulation, as the
maximum reserve requirement (including, without limitation, any basic,
supplemental, emergency, special, or marginal reserves) applicable with respect
to Eurocurrency liabilities as that term is defined in Regulation D (or against
any other category of liabilities that includes deposits by reference to which
the interest rate of Eurodollar Loans is determined), whether or not any Lender
has any Eurocurrency liabilities subject to such reserve requirement at that
time. Eurodollar Loans shall be deemed to constitute Eurocurrency liabilities
and as such shall be deemed subject to reserve requirements without benefits of
credits for proration, exceptions or offsets that may be available from time to
time to a Lender. The Adjusted Eurodollar Rate shall be adjusted automatically
on and as of the effective date of any change in the Reserve Percentage.
     1.3 “Administrative Borrower” shall mean Associated Materials, LLC, a
Delaware limited liability company, in its capacity as Administrative Borrower
on behalf of itself and the other Borrowers pursuant to Section 6.10 hereof and
its successors and assigns in such capacity.
     1.4 “Affiliate” shall mean, with respect to a specified Person, any other
Person (excluding any Subsidiary) which directly or indirectly, through one or
more intermediaries, controls or is controlled by or is under common control
with such Person. For the purposes of this definition, the term “control”
(including with correlative meanings, the terms “controlled by” and “under
common control with”), as used with respect to any Person, means the possession,
directly or indirectly, of the power either (a) to vote ten (10%) percent or
more of the securities having ordinary voting power for the election of
directors of such Person or (b) to direct or cause the direction of the
management and policies, whether through the ownership of Equity Interests, by
agreement or otherwise.
     1.5 “Agent” shall mean Wachovia Bank, National Association, in its capacity
as agent on behalf of Lenders pursuant to the terms hereof and any replacement
or successor agent hereunder.
     1.6 “Applicable Margin” shall mean, with respect to Base Rate Loans and
Eurodollar Rate Loans, the applicable percentage (on a per annum basis) set
forth below based on the Quarterly Average Excess Availability for the
immediately preceding three (3) month period.

                                      Applicable         Applicable   (US or
Canadian)     Quarterly Average   Eurodollar   Base Tier   Excess Availability  
Rate Margin   Rate Margin
1
  Greater than $175,000,000     2.50 %     .75 %
2
  Less than or equal to $175,000,000 and greater than $150,000,000     2.75 %  
  1.00 %
3
  Less than or equal to $150,000,000 and greater than $125,000,000     3.00 %  
  1.25 %
4
  Less than or equal to $125,000,000 and greater than $75,000,000     3.25 %    
1.50 %
5
  Less than or equal to $75,000,000     3.50 %     1.75 %

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provided, that, (i) the Applicable Margin shall be calculated and established
once every three (3) months and shall remain in effect until adjusted for the
next three (3) month period, (ii) each adjustment of the Applicable Margin shall
be effective as of the first day of each such three (3) month period based on
the Quarterly Average Excess Availability for the immediately preceding three
(3) month period, (iii) the Applicable Margin through March 31, 2009 shall be
the amount for Tier 3 set forth above and (iv) in the event that Borrowers fail
to provide any Borrowing Base Certificate or other information with respect
thereto for any period on the date required hereunder, effective as of the date
on which such Borrowing Base Certificate or other information was otherwise
required, at Agent’s option, the then effective Applicable Margin shall be
increased by two (2%) percentage points until the next Business Day after a
Borrowing Base Certificate or other information is provided for the applicable
period at which time the Applicable Margin shall be adjusted as otherwise
provided herein. In the event that at any time after the end of any three
(3) month period the Quarterly Average Excess Availability for such three
(3) month period used for the determination of the Applicable Margin was greater
than the actual amount of the Quarterly Average Excess Availability for such
period as a result of the inaccuracy of information provided by or on behalf of
Borrowers to Agent for the calculation of Excess Availability, the Applicable
Margin for such prior period shall be adjusted to the applicable percentage
based on such actual Quarterly Average Excess Availability and any additional
interest for the applicable period as a result of such recalculation shall be
promptly paid to Agent. The foregoing shall not be construed to limit the rights
of Agent and Lenders with respect to the amount of interest payable after a
Default or Event of Default whether based on such recalculated percentage or
otherwise.
     1.7 “Approved Fund” shall mean any Person (other than a natural Person),
including, without limitation, any special purpose entity, that is (or will be)
engaged in making, purchasing, holding or otherwise investing in bank revolving
loans and similar extensions of credit in the ordinary course of its business;
provided, that, such Approved Fund must be administered 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.
     1.8 “Arrangers” shall mean each of (a) Wachovia Capital Markets, LLC, a
Delaware limited liability company, and (b) CIT Capital Securities, LLC, a
Delaware limited liability company, in its capacity as joint lead arrangers, and
their successors and assigns hereunder; each sometimes referred to herein
individually as an “Arranger”.
     1.9 “Assignment and Acceptance” shall mean an Assignment and Acceptance
substantially in the form of Exhibit A attached hereto (with blanks
appropriately completed) delivered to Agent in connection with an assignment of
a Lender’s interest hereunder in accordance with the provisions of Section 15.7
hereof.
     1.10 “Bank Product Provider” shall mean any Lender, Affiliate of any Lender
or other financial institution (in each case as to any Lender, Affiliate or
other financial institution to the extent approved by Agent) that provides any
Bank Products to Borrowers or Guarantors.
     1.11 “Bank Products” shall mean any one or more of the following types of
services or facilities provided to a Borrower or Guarantor by Agent or a Bank
Product Provider: (a) credit cards, debit cards or stored value cards or the
processing of payments and other administrative services with respect to credit
cards, debit cards or stored value cards or (b) cash management or related
services, including (i) the automated clearinghouse transfer of funds for the
account of a Borrower pursuant to agreement or overdraft for any accounts of
Borrowers or Guarantors maintained at Agent or any Bank Product Provider that
are subject to the control of Agent pursuant to any Deposit Account Control
Agreement to which Agent, such Affiliate of Agent, Lender or Affiliate of Lender
is a party, as applicable, (ii) controlled disbursement services and (iii) Hedge
Agreements if and to the extent permitted hereunder. Any of the foregoing shall
only be included in the definition of the term “Bank Products” to the extent
that the Lender, its Affiliate or the other financial institution providing such
services or facilities has been approved by Agent in writing with notice to
Administrative Borrower.

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     1.12 “Base Rate Loans” shall mean US Base Rate Loans and Canadian Base Rate
Loans. All Swing Line Loans shall be Base Rate Loans.
     1.13 “Borrowers” shall mean, collectively, US Borrowers and Canadian
Borrowers; each sometimes being referred to herein individually as a “Borrower”.
     1.14 “Borrowing Base” shall mean, collectively, the Canadian Borrowing Base
and the US Borrowing Base.
     1.15 “Borrowing Base Certificate” shall mean a certificate substantially in
the form of Exhibit B hereto, as such form, subject to the terms hereof, may
from time to time be modified by Agent, which is duly completed (including all
schedules thereto) and executed by the chief executive officer, chief financial
officer, controller or other appropriate financial officer of Administrative
Borrower acceptable to Agent and delivered to Agent.
     1.16 “Business Day” shall mean (a) with respect to the US Obligations, any
day other than a Saturday, Sunday, or other day on which commercial banks in New
York or North Carolina are authorized or required to close, or (b) with respect
to the Canadian Obligations, any day other than a Saturday, Sunday, or other day
on which commercial banks in Toronto, Ontario are authorized or required to
close; except that if a determination of a Business Day shall relate to any
Eurodollar Rate Loans, the term Business Day shall also exclude any day on which
banks are closed for dealings in dollar deposits in the London interbank market
or other applicable Eurodollar Rate market.
     1.17 “Canadian Base Rate” shall mean, at any time, the annual rate of
interest equal to the greater of (a) the annual rate from time to time publicly
announced by Canadian Reference Bank as its prime rate in effect for determining
interest rates on Canadian Dollar denominated commercial loans in Canada or
(b) the annual rate of interest equal to the sum of the 30-day CDOR Rate at such
time plus one (1%) percent per annum.
     1.18 “Canadian Base Rate Loans” shall mean any Canadian Dollar Loans or
portion thereof on which interest is payable based on the Canadian Base Rate in
accordance with the terms hereof.
     1.19 “Canadian Borrowers” shall mean, collectively, the following (together
with their respective successors and assigns): (a) Gentek Building Products
Limited, a corporation incorporated under the laws of the Province of Ontario,
Canada; and (b) any other Person that at any time after the date hereof becomes
a Canadian Borrower; each sometimes being referred to herein individually as a
“Canadian Borrower”.
     1.20 “Canadian Borrowing Base” shall mean, at any time the amount equal to:
          (a) the amount equal to: (i) eighty-five (85%) percent of the Eligible
Accounts of Canadian Borrowers, plus
          (b) the amount equal to the least of (i) the sum of (A) fifty (50%)
percent multiplied by the Value of Eligible Inventory of Canadian Borrowers
consisting of raw materials other than Painted Coil, plus (B) the lesser of
(1) thirty-five (35%) percent multiplied by the Value of Eligible Inventory of
Canadian Borrowers consisting of Painted Coil, and (2) $2,500,000, plus
(C) sixty (60%) percent multiplied by the Value of Eligible Inventory of
Canadian Borrowers consisting of finished goods, (ii)

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eighty-five (85%) percent of the Net Recovery Percentage of the applicable
category of Eligible Inventory of Canadian Borrowers multiplied by the Value of
such Eligible Inventory and (iii) the Canadian Inventory Loan Limit; provided,
that, the aggregate outstanding amount of Loans and Letters of Credit that shall
be provided to Canadian Borrowers based upon Eligible Inventory consisting of
Eligible Domestic In-Transit Inventory will not exceed the US Dollar Equivalent
of $4,000,000, plus
          (c) the amount equal to the lesser of (i) the Canadian Fixed Asset
Availability and (ii) the US Dollar Equivalent of $9,000,000; minus
          (d) Reserves attributable to Canadian Borrowers.
     1.21 “Canadian Cash Equivalents” shall mean any of the following (a) any
evidence of Indebtedness issued, guaranteed or insured by the government of
Canada or any province, and having terms to maturity of not more than one
hundred eighty (180) days from the date of acquisition, (b) certificates of
deposit having maturities of not more than one year issued or guaranteed by any
Canadian chartered bank and rated A (or the then equivalent grade) or better by
Dominion Bond Rating Service, (c) Canadian Dollar denominated bankers
acceptances of any Canadian chartered bank and rated A (or the then equivalent
grade) or better by Dominion Bond Rating Service having terms to maturity of not
more than one hundred eighty (180) days, (d) commercial paper having terms to
maturity of not more than two hundred seventy (270) days from the date of
acquisition issued by, or guaranteed by, any company which is rated at least A-2
(or any equivalent rating) by S&P and P-2 (or any equivalent rating) by Moody’s,
(e) repurchase agreements and reverse repurchase agreements relating to
marketable direct obligations issued or unconditionally guaranteed by the
Government of Canada or any province or issued by any governmental agency
thereof maturing within one hundred eighty (180) days or less, and
(f) investments in money market funds substantially all the assets of which are
comprised of securities of the types described in clauses (a) through (e) above.
     1.22 “Canadian Collateral” shall mean all personal and real property and
fixtures, and interests in property and fixtures, of any Canadian Loan Party,
whether now owned or hereafter acquired or existing, and wherever located.
     1.23 “Canadian Commitment” shall mean, at any time, as to each Lender, the
principal amount set forth below such Lender’s signature on the signatures pages
hereto designated as the Canadian Commitment or on Schedule 1 to the Assignment
and Acceptance Agreement pursuant to which such Lender became a Lender hereunder
in accordance with the provisions of Section 15.7 hereof, as the same may be
adjusted from time to time in accordance with the terms hereof; sometimes being
collectively referred to herein as “Canadian Commitments”.
     1.24 “Canadian Credit Facility” shall mean the Loans and Letters of Credit
provided to or for the benefit of Canadian Borrowers pursuant to Section 2
hereof.
     1.25 “Canadian Dollar Loans” shall mean any Loans or portion thereof which
are denominated in Canadian Dollars and on which interest is payable based on
the Canadian Base Rate in accordance with the terms hereof.
     1.26 “Canadian Dollars” and “C$” shall each mean the lawful currency of
Canada.
     1.27 “Canadian Equipment Availability” shall mean eighty-five (85%) percent
of the net orderly liquidation value of Eligible Equipment of Canadian Borrowers
based (a) as of the date hereof, upon the appraisal thereof in form and
containing assumptions and appraisal methods satisfactory to Agent, by an
appraiser acceptable to Agent and on which Agent is specifically permitted to
rely, delivered

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to Agent on or before the date hereof and (b) after the date hereof, on each
subsequent appraisal of the Eligible Equipment of Canadian Borrowers delivered
to Agent pursuant to Section 7.4 hereof; reduced as of November 1, 2008 and the
first (1st) day of each month thereafter during the term hereof by an amount
equal to one-sixtieth (1/60th) of the Canadian Equipment Availability as of the
date hereof.
     1.28 “Canadian Excess Availability” shall mean the amount, as determined by
Agent, calculated at any date, equal to: (a) the lesser of: (i) the Canadian
Borrowing Base and (ii) the Canadian Loan Limit (in each case under (i) or
(ii) after giving effect to any Reserves other than any Reserves in respect of
Canadian Letter of Credit Obligations), minus (b) the sum of: (i) the amount of
all then outstanding and unpaid Canadian Obligations (but not including for this
purpose Canadian Obligations arising pursuant to any guarantees in favor of
Agent and Canadian Lenders of the Canadian Obligations of the other Canadian
Borrowers or any outstanding Canadian Letter of Credit Obligations), plus
(ii) the amount of all Reserves then established in respect of Canadian Letter
of Credit Obligations, plus (iii) the aggregate amount in excess of $185,000 of
all then outstanding and unpaid trade payables and other obligations of Canadian
Borrowers which are outstanding more than sixty (60) days past due as of the end
of the immediately preceding month or at Agent’s option, as of a more recent
date based on such reports as Agent may from time to time specify (other than
trade payables or other obligations being contested or disputed by Canadian
Borrowers in good faith), plus (iv) without duplication, the amount of checks
issued by Canadian Borrowers to pay trade payables and other obligations which
are more than sixty (60) days past due as of the end of the immediately
preceding month or at Agent’s option, as of a more recent date based on such
reports as Agent may from time to time specify (other than trade payables or
other obligations being contested or disputed by Canadian Borrowers in good
faith), but not yet sent.
     1.29 “Canadian Fixed Asset Availability” shall mean the lesser of (a) the
sum of the Canadian Equipment Availability and the Canadian Real Property
Availability and (b) fifteen (15%) percent of the Canadian Loan Limit.
     1.30 “Canadian Guarantors” shall mean any Person that at any time after the
date hereof becomes party to a guarantee in favor of Agent or any Lender in
respect of or otherwise liable on or with respect to the Canadian Obligations
(but not the US Obligations) or who is the owner of any property which is
security for the Canadian Obligations (other than Canadian Borrowers) together
with their respective successors and assigns; each sometimes being referred to
herein individually as a “Canadian Guarantor”.
     1.31 “Canadian Inventory Loan Limit” shall mean the US Dollar Equivalent of
$35,000,000, not to exceed, when taken together with the US Inventory Loan
Limit, the US Dollar Equivalent of $100,000,000.
     1.32 “Canadian Issuing Bank” shall mean such financial institution that is
approved by Agent that shall issue a Letter of Credit for the account of a
Canadian Borrower and has agreed in a manner satisfactory to Agent to be subject
to the terms hereof as Canadian Issuing Bank.
     1.33 “Canadian Lender” shall mean, at any time, each Lender having a
Canadian Commitment or a Loan (or Canadian Letter of Credit Obligation) made to
any Canadian Borrower owing to it at such time; sometimes being referred to
herein collectively as “Canadian Lenders”.
     1.34 “Canadian Letter of Credit Limit” shall mean the US Dollar Equivalent
of $3,000,000.
     1.35 “Canadian Letter of Credit Obligations” shall mean at any time, the
sum of (a) the aggregate undrawn amount of all Letters of Credit issued for the
account of Canadian Borrowers outstanding at such time, plus (b) without
duplication, the aggregate amount of all drawings under Letters

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of Credit issued for the account of Canadian Borrowers for which the Canadian
Issuing Bank has not at such time been reimbursed, plus (c) without duplication,
the aggregate amount of all payments made by Canadian Lender to the Canadian
Issuing Bank with respect to such Canadian Lender’s participation in Letters of
Credit issued for the account of Canadian Borrowers as provided in Section 2.3
for which Canadian Borrowers have not at such time reimbursed the Canadian
Lenders, whether by way of a Revolving Loan or otherwise.
     1.36 “Canadian Loan Limit” shall mean the US Dollar Equivalent of
US$60,000,000, as such amount may be increased or decreased pursuant to and in
accordance with the terms of Section 2.6 hereof.
     1.37 “Canadian Loan Parties” shall mean Canadian Borrowers and Canadian
Guarantors; each sometimes being referred to individually as a “Canadian Loan
Party.”
     1.38 “Canadian Obligations” shall mean (a) any and all Loans, Letter of
Credit Obligations and all other obligations, liabilities and indebtedness of
every kind, nature and description owing by Canadian Loan Parties to Agent, any
Canadian Lender or any Canadian Issuing Bank arising under this Agreement or any
of the other Loan Documents, including principal, interest, charges, fees, costs
and expenses, however evidenced, whether as principal, surety, endorser,
guarantor or otherwise, arising under this Agreement or any of the other Loan
Documents or on account of any Letter of Credit and all other Canadian Letter of
Credit Obligations, whether now existing or hereafter arising, whether arising
before, during or after the initial or any renewal term of this Agreement or
after the commencement of any case or proceeding with respect to any Canadian
Loan Party under the United States Bankruptcy Code, the Bankruptcy and
Insolvency Act (Canada), the Companies’ Creditors Arrangement Act (Canada) or
any similar statute in any jurisdiction (including the payment of interest and
other amounts which would accrue and become due but for the commencement of such
case or proceeding, whether or not such amounts are allowed or allowable in
whole or in part in such case), whether direct or indirect, absolute or
contingent, joint or several, due or not due, primary or secondary, liquidated
or unliquidated, or secured or unsecured and (b) for purposes only of
Section 5.1 hereof and subject to the priority in right of payment set forth in
Section 6.7 hereof, all obligations, liabilities and indebtedness of every kind,
nature and description owing by any Canadian Loan Party to Agent or any Bank
Product Provider arising under or pursuant to any Bank Products, whether now
existing or hereafter arising; provided, that, (i) as to any such obligations,
liabilities and indebtedness arising under or pursuant to a Hedge Agreement, the
same shall only be included within the Canadian Obligations if upon Agent’s
request, Agent shall have entered into an agreement, in form and substance
reasonably satisfactory to Agent, with the Bank Product Provider that is a
counterparty to such Hedge Agreement, as acknowledged and agreed to by Canadian
Borrowers, providing for the delivery to Agent by such counterparty of
information with respect to the amount of such obligations and providing for the
other rights of Agent and such Bank Product Provider in connection with such
arrangements, (ii) any Bank Product Provider, other than Wachovia and its
Affiliates, shall have delivered written notice to Agent that (A) such Bank
Product Provider has entered into a transaction to provide Bank Products to such
Canadian Borrower and (B) the obligations arising pursuant to such Bank Products
provided to such Canadian Borrower constitute Canadian Obligations entitled to
the benefits of the security interest of Agent granted hereunder, and Agent
shall have accepted such notice in writing and (iii) in no event shall any Bank
Product Provider acting in such capacity to whom such obligations, liabilities
or indebtedness are owing be deemed a Lender for purposes hereof to the extent
of and as to such obligations, liabilities or indebtedness except that each
reference to the term “Lender” in Sections 14.1, 14.2, 14.3(b), 14.6, 14.7,
14.9, 14.12 and 15.6 hereof shall be deemed to include such Bank Product
Provider and in no event shall the approval of any such person in its capacity
as Bank Product Provider be required in connection with the release or
termination of any security interest or lien of Agent.

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     1.39 “Canadian Payment Account” shall mean account no. 0360-01-2027713 of
Agent at Canadian Reference Bank or such other account as Agent may from time to
time designate to Administrative Borrower as the Canadian Payment Account.
     1.40 “Canadian Pension Plan” shall mean any plan, program or arrangement
that is a pension plan for the purposes of any applicable pension benefits
legislation or any tax laws of Canada or a Province thereof, whether or not
registered under any such laws, which is maintained or contributed to by, or to
which there is or may be an obligation to contribute by, any Borrower or
Guarantor in respect of any Person’s employment in Canada with such Borrower or
Guarantor.
     1.41 “Canadian Real Property Availability” shall mean seventy (70%) percent
of the appraised fair market value of the Eligible Real Property of Canadian
Borrowers based (a) on the date hereof, upon the appraisal thereof in form and
containing assumptions and appraisal methods satisfactory to Agent, by an
appraiser acceptable to Agent and on which Agent is specifically permitted to
rely, delivered to Agent on or before the date hereof and (b) after the date
hereof, on each subsequent appraisal of the Eligible Real Property of Canadian
Borrowers delivered to Agent pursuant to Section 7.4 hereof; reduced in either
case as of November 1, 2008 and the first (1st) day of each month thereafter
during the term hereof, by an amount equal to one-sixtieth (1/60th) of the
Canadian Real Property Availability.
     1.42 “Canadian Reference Bank” shall mean Toronto Dominion Bank (Toronto)
or such other bank listed in Schedule I of the Bank Act (Canada) as Agent may
from time to time designate.
     1.43 “Capital Expenditures” shall mean with respect to any Person for any
period the aggregate of all expenditures by such Person and its Subsidiaries
made during such period that in accordance with GAAP are or should be included
in “property, plant and equipment” or in a similar fixed asset account on its
balance sheet, whether such expenditures are paid in cash or financed and
including all Capitalized Lease Obligations paid or payable during such period,
other than the interest component of any Capitalized Lease Obligation (without
duplication as to any period). Capital Expenditures shall exclude
(a) expenditures for assets purchased as part of a Permitted Acquisition, and
(b) expenditures for assets made in connection with the replacement,
substitution, restoration or repair of assets to the extent financed with
insurance proceeds paid on account of the loss of or damage to the assets being
replaced, repaired, restored or substituted for to the extent permitted
hereunder.
     1.44 “Capital Leases” shall mean, as applied to any Person, any lease of
(or any agreement conveying the right to use) any property (whether real,
personal or mixed) by such Person as lessee which in accordance with GAAP, is
required to be reflected as a liability on the balance sheet of such Person;
provided, that, a lease of Real Property that is not Indebtedness under the
definition of such term as used herein shall not be deemed a Capital Lease, to
the extent constituting an operating lease in accordance with GAAP.
     1.45 “Capitalized Lease Obligations” shall mean, as to any Person, the
obligations of such Person under a lease that are required to be classified and
accounted for as capital lease obligations under GAAP and, for purposes of this
definition, the amount of such obligations at any date shall be the capitalized
amount of such obligations at such date on a balance sheet prepared in
accordance with GAAP.
     1.46 “Cash Dominion Event” shall mean (a) a Default or Event of Default or
(b) the Global Availability Test Condition is not met.
     1.47 “Cash Equivalents” shall mean, at any time, (a) any evidence of
Indebtedness with a maturity date of six (6) months or less issued or directly
and fully guaranteed or insured by the United

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States of America or any agency or instrumentality thereof; provided, that, the
full faith and credit of the United States of America is pledged in support
thereof; (b) certificates of deposit or bankers’ acceptances with a maturity of
six (6) months or less of (i) any Lender or (ii) any financial institution that
is a member of the Federal Reserve System having combined capital and surplus
and undivided profits of not less than $500,000,000; (c) commercial paper
(including variable rate demand notes) with a maturity of two hundred seventy
(270) days or less issued by a corporation (except an Affiliate of any Borrower
or Guarantor) organized under the laws of any State of the United States of
America or the District of Columbia and rated at least A-1 by Standard & Poor’s
Ratings Service, a division of The McGraw-Hill Companies, Inc. or at least P-1
by Moody’s Investors Service, Inc.; (d) repurchase obligations with a term of
not more than thirty (30) days for underlying securities of the types described
in clause (a) above entered into with (i) any Lender or (ii) any financial
institution having combined capital and surplus and undivided profits of not
less than $500,000,000; (e) repurchase agreements and reverse repurchase
agreements relating to marketable direct obligations issued or unconditionally
guaranteed by the United States of America or issued by any governmental agency
thereof and backed by the full faith and credit of the United States of America,
in each case maturing within six (6) months or less from the date of
acquisition; provided, that, the terms of such agreements comply with the
guidelines set forth in the Federal Financial Agreements of Depository
Institutions with Securities Dealers and Others, as adopted by the Comptroller
of the Currency on October 31, 1985; and (f) investments in money market funds
and mutual funds which invest substantially all of their assets in securities of
the types described in clauses (a) through (e) above.
     1.48 “Cash Management Accounts” shall have the meaning set forth in
Section 6.6 hereof.
     1.49 “CDOR Rate” shall mean, on any day, the annual rate of interest which
is the rate equal to the average rate for 30 day Canadian Dollar bankers’
acceptances issued on such day for a term equal or comparable for the purpose of
calculating the interest rate applicable as such rate appears on the “Reuters
Screen CDOR Page” (as defined in the International Swaps and Derivatives
Association, Inc. 2000, definitions, as modified and amended from time to time)
rounded to the nearest 1/100th of 1% (with 0.005% being rounded up), as of
10:00 a.m. on such day, or if such day is not a Business Day, then on the
immediately preceding Business Day; provided, that, if such rate does not appear
on the Reuters Screen CDOR Page as contemplated, then the CDOR Rate on any day
shall be the average of the rates applicable to 30 day Canadian Dollar bankers’
acceptances quoted by the Schedule I Canadian chartered banks as of 10:00 a.m.
on such day, or if such day is not a Business Day, then on the immediately
preceding Business Day.
     1.50 “Change in Law” means the occurrence, after the date of this
Agreement, of any of the following: (a) the adoption or taking effect of any
law, rule, regulation or treaty, (b) any change in any law, rule, regulation or
treaty or in the administration, interpretation or application thereof by any
Governmental Authority or (c) the making or issuance of any request, guideline
or directive (whether or not having the force of law) by any Governmental
Authority.
     1.51 “Change of Control” shall mean (a) the transfer (in one transaction or
a series of transactions) of all or substantially all of the assets of any
Borrower or Parent to any Person or group (as such term is used in
Section 13(d)(3) of the Exchange Act), other than as permitted in Section 10.1
hereof; (b) the liquidation or dissolution of any Borrower or Parent or the
adoption of a plan by the stockholders of any Borrower or Parent relating to the
dissolution or liquidation of such Borrower or Parent , other than as permitted
in Section 10.1 hereof; (c) the acquisition by any Person or group (as such term
is used in Section 13(d)(3) of the Exchange Act), except for one or more
Permitted Holders, of beneficial ownership, directly or indirectly, of a
majority of the voting power of the total outstanding Equity Interests of any
Borrower or Guarantor or the Board of Directors of any Borrower or Guarantor;
(d) during any period of two (2) consecutive years, individuals who at the
beginning of such period

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constituted the Board of Directors of any Borrower or Guarantor (together with
any new directors who have been appointed by any Permitted Holder, or whose
nomination for election by the stockholders of such Borrower or Guarantor, as
the case may be, was approved by a vote of at least a majority of the directors
then still in office who were either directors at the beginning of such period
or whose election or nomination for election was previously so approved) cease
for any reason to constitute a majority of the Board of Directors of any
Borrower or Guarantor then still in office; or (e) the failure of Parent to own
directly or indirectly one hundred (100%) percent of the voting power of the
total outstanding Equity Interests of each Borrower.
     1.52 “Code” shall mean the Internal Revenue Code of 1986, as the same now
exists or may from time to time hereafter be amended, modified, recodified or
supplemented, together with all rules, regulations and interpretations
thereunder or related thereto.
     1.53 “Collateral” shall have the meaning set forth in Section 5 hereof.
     1.54 “Collateral Access Agreement” shall mean an agreement in writing, in
form and substance satisfactory to Agent, from any lessor of premises to any
Borrower or Guarantor, or any other person to whom any Collateral is consigned
or who has custody, control or possession of any such Collateral or is otherwise
the owner or operator of any premises on which any of such Collateral is
located, in favor of Agent with respect to the Collateral at such premises or
otherwise in the custody, control or possession of such lessor, consignee or
other person.
     1.55 “Commitment” shall mean, at any time, as to any Lender, the aggregate
of such Lender’s US Commitments and Canadian Commitments; sometimes being
collectively referred to herein as “Commitments”; provided, that, the aggregate
Commitments of all Lenders shall not exceed the US Dollar Equivalent of
US$225,000,000 as such amount may be increased pursuant to and in accordance
with Section 2.6 hereof.
     1.56 “Concentration Accounts” shall mean, collectively, the deposit
accounts of Borrowers identified on Schedule 8.10 of the Information Certificate
as the concentration accounts and such other accounts as may be established
after the date hereof in accordance with the terms hereof used to receive funds
from the Cash Management Accounts; sometimes being referred to herein
individually as a “Concentration Account”.
     1.57 “Consolidated EBITDA” shall mean, for any period, the sum (without
duplication) of: (a) Consolidated Net Income for such period, (b) plus or minus
to the extent included in determining Consolidated Net Income (i) any gain/loss
realized during such period by Parent or any of its Subsidiaries upon any sale
of assets (other than any dispositions in the ordinary course of business) by
Parent or any of its Subsidiaries, (ii) unrealized gains and losses with respect
to obligations under Hedge Agreements to the extent not constituting Interest
Expense; (iii) all income tax expense (benefit) of Borrowers and Guarantors paid
or accrued in accordance with GAAP for such period, (iv) Interest Expense and
non-cash interest expense (including payment-in-kind interest and the
amortization of deferred financing fees), (v) depreciation and amortization, and
(vi) any cash and non-cash expenses related to the early extinguishment of
Indebtedness; (vii) reasonable out-of-pocket non-capitalized costs, fees and
expenses incurred in connection with any merger or joint venture permitted
herein, including Permitted Acquisitions; provided, that, such non-capitalized
cash expenses (A) are incurred not later than three months after the
consummation, of such Permitted Acquisition, and (B) shall not exceed $1,500,000
for any single Permitted Acquisition or $3,000,000 for all Permitted
Acquisitions during any period of twelve (12) consecutive months, (viii) cash
and non-cash charges associated with the Mid-West distribution strategy (which
includes the opening of a new distribution center in Ashtabula, Oh, product line
consolidation and transition of certain vinyl siding manufacturing from Ennis,
Texas to Burlington,

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Ontario, and elimination of the use of the warehouse adjacent to the Ennis
manufacturing plant); provided, that, such cash charges associated with the
consolidation and related asset sale expenses shall not exceed $1,500,000 during
any period of twelve (12) consecutive months, (ix) the call premium contemplated
by paragraph 5 of the notes issued pursuant to of the Opco Indenture as in
effect on the date hereof (x) non-capitalized fees, costs, expenses and
prepayment premiums paid by Borrower or Guarantors contemplated by this
Agreement to the extent that the foregoing do not exceed the US Dollar
Equivalent of $5,000,000 in the aggregate, (xi) the amount of the amortization
in respect of management fees paid in conjunction with the 2004 transaction with
Investcorp and (xii) any other non-cash charges or credits excluding such
charges incurred in the ordinary course of business and excluding any reduction
in current assets; (xiii) nonrecurring litigation or claim settlement charges or
expenses to the extent not reimbursed by insurance; provided, that, such
nonrecurring litigation or claim settlement charges or expenses shall not exceed
$500,000 during any period of twelve (12) consecutive months; and
(xiv) nonrecurring gains, losses and charges; provided, that, such nonrecurring
gains, losses and charges shall not exceed $2,500,000 during any period of
twelve (12) consecutive months and such amount is identified in the public
filings of Parent or its Affiliates and consistent the with historical practices
of Borrowers and Guarantors. Notwithstanding the foregoing, the Consolidated
EBITDA of Borrowers and Guarantors on a consolidated basis for each period set
forth on Schedule 1.57 hereto shall be deemed to be the amount set forth on
Schedule 1.57 hereto opposite such period.
     1.58 “Consolidated Net Income” shall mean, with respect to Parent and its
Subsidiaries for any period, the aggregate of the net income (or loss) of Parent
and its Subsidiaries, on a consolidated basis, for such period (excluding to the
extent included therein any extraordinary gain (or extraordinary loss), together
with any related Provision for Taxes on any such gain (or loss), recorded or
recognized by Parent or any of its Subsidiaries, as to each of the items
described in this definition as determined in accordance with GAAP); provided,
that, (a) the effects of any change in accounting principles adopted by, or
applicable to, Parent and its Subsidiaries after the date hereof (including any
cumulative effects resulting from changes in purchase accounting principles)
shall be excluded; (b) the portion of Consolidated Net Income of any Subsidiary
of such Person that is not a Borrower or a Subsidiary Guarantor shall be
excluded from Consolidated Net Income; and (c) the net income (if positive) of
any Subsidiary to the extent that the declaration or payment of dividends or
similar distributions by such Subsidiary to such Person or to any other
Subsidiary of such Person is not at the time permitted by operation of the terms
of its charter or any agreement (other than this agreement), instrument,
judgment, decree, order, statute, rule or governmental regulation applicable to
such Subsidiary shall be excluded.
     1.59 “Control Notice” shall mean a written notice delivered pursuant to a
Deposit Account Control Agreement instructing the depository bank to comply with
instructions originated by Agent with respect to the deposit account that is
covered thereby without further consent of any Borrower or Guarantor.
     1.60 “Credit Facility” shall mean , collectively, the US Credit Facility
and the Canadian Credit Facility.
     1.61 “Default” shall mean an act, condition or event which with notice or
passage of time or both would constitute an Event of Default.
     1.62 “Defaulting Lender” shall have the meaning set forth in Section 6.13
hereof.
     1.63 “Deposit Account Control Agreement” shall mean an agreement in
writing, in form and substance satisfactory to Agent, by and among Agent, the
Borrower or Guarantor with a deposit account at any bank and the bank at which
such deposit account is at any time maintained which provides that such bank
will comply with instructions originated by Agent directing disposition of the
funds in the deposit account without further consent by such Borrower or
Guarantor and has such other terms and conditions as Agent may reasonably
require.

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     1.64 “Disqualified Equity Interest” means, with respect to any Person, any
Equity Interest in such Person that, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable, either
mandatory or at the option of the holder thereof) or upon the happening of any
event or condition:
          (a) matures or is mandatorily redeemable (other than solely for Equity
Interests in such Person that do not constitute Disqualified Equity Interests
and cash in lieu of fractional shares of such Equity Interests), whether
pursuant to a sinking fund obligation or otherwise;
          (b) is convertible or exchangeable at the option of the holder thereof
for Indebtedness or Equity Interests (other than solely for Equity Interests in
such Person that do not constitute Disqualified Equity Interest and cash in lieu
of fractional shares of such Equity Interests); or
          (c) is redeemable (other than solely for Equity Interests in such
Person that do not constitute Disqualified Equity Interest and cash in lieu of
fractional shares of such Equity Interests) or is required to be repurchased by
such Person or any of its Affiliates, in whole or in part, at the option of the
holder thereof.
     1.65 “Eligible Accounts” shall mean Accounts created by a Borrower that in
each case at the time of creation and at all times thereafter satisfy the
criteria set forth below as determined by Agent. Without limiting Agent’s
discretion provided herein, Eligible Accounts shall not include:
          (a) any Account which is not subject to a first priority perfected
security interest in favor of Agent;
          (b) any Account which is subject to any security interest, lien or
other encumbrance other than the security interest and lien of Agent and those
permitted in clauses (b) and (c) of Section 10.2 hereof (but as to liens
referred to in clause (c) only to the extent that Agent has established a
Reserve as provided therein) and any other liens permitted under this Agreement
that are subject to an intercreditor agreement in form and substance
satisfactory to Agent between the holder of such security interest or lien and
Agent;
          (c) any Account that is unpaid more than sixty (60) days after the
original due date for them or one hundred twenty (120) days after the date of
the original invoice for it, or which has been written off the books of such
Person or otherwise designated as uncollectible;
          (d) any Account owing by an account debtor for which more than fifty
(50%) percent of the Accounts owing by such account debtor and its Affiliates
are ineligible hereunder;
          (e) any Account owing by a single account debtor (provided, that, for
the avoidance of doubt, for the purposes of this definition, each individual
“Dealer” shall be treated as a single account debtor) to the extent that the
aggregate amount of such Accounts exceeds seven (7%) percent of the aggregate
amount of all otherwise Eligible Accounts (but the portion of the Accounts not
in excess of such percentage that otherwise satisfy the criteria herein will be
deemed Eligible Accounts and it being understood that such seven (7%) percent
limitation shall apply to the Eligible Accounts of the US Borrowers and the
Canadian Borrowers collectively);

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          (f) any Account in respect of which the aggregate amount owing by the
account debtor thereunder to a Borrower is less than the US Dollar Equivalent of
$3,000; except, that, such Accounts which would in all other respects constitute
Eligible Accounts shall be Eligible Accounts to the extent that the aggregate
amounts thereof do not exceed the US Dollar Equivalent of: (i) in the case of
such Accounts owing by account debtors of US Borrowers, $1,600,000 in the
aggregate and (ii) in the case of Canadian Borrowers, $600,000 in the aggregate.
          (g) any Account with respect to which any covenant, representation, or
warranty contained in this Agreement or in the other Loan Documents has been
breached or is not true in any material respect;
          (h) any Account that (i) does not arise from the sale of goods or
performance of services in the ordinary course of business, (ii) is not
evidenced by an invoice or other documentation satisfactory to Agent and which
has been sent to the account debtor, (iii) represents a progress billing,
(iv) is contingent upon such Person’s or its Affiliates’ completion of any
further performance, (v) represents a sale on a bill-and-hold, guaranteed sale,
sale-and-return, sale on approval, consignment, cash-on-delivery or any other
repurchase or return basis, (vi) relates to payments of interest or (vii) has
been invoiced more than once;
          (i) any Account with respect to which any checks or other instruments
of payment in the amount of $15,000 or more in the case of any such check or
other instrument has been returned uncollected for any reason;
          (j) any Account owed by an account debtor which has (i) applied for,
suffered, or consented to the appointment of any receiver, interim receiver,
receiver-manager, custodian, trustee, or liquidator of its assets, (ii) had
possession of all or a material part of its property taken by any receiver,
interim receiver, receiver-manager, custodian, trustee or liquidator,
(iii) filed, or had filed against it, any request or petition for liquidation,
reorganization, arrangement, adjustment of debts, adjudication as bankrupt,
winding-up, or voluntary or involuntary case under any Federal, State,
Provincial or territorial bankruptcy laws (other than post-petition accounts
payable of an account debtor that is a debtor-in-possession under the US
Bankruptcy Code and acceptable to Agent), (iv) admitted in writing its
inability, or is generally unable to, pay its debts as they become due,
(v) become insolvent, or (vi) ceased operation of its business;
          (k) any Account owed by any account debtor that has sold all or
substantially all its assets (unless such Account has been assumed by a Person
that shall have acquired such assets and otherwise satisfies the requirements
set forth in this definition);
          (l) any Account owed by an account debtor that (i) does not maintain
its chief executive office in the United States or Canada or (ii) is not
organized under applicable law of the United States, any State of the United
States, Canada, or any Province of Canada, unless, in either case, such Account
is backed by a letter of credit acceptable to Agent and that has been assigned
to and is directly drawable by Agent; except, that, up to $500,000 of such
Accounts outstanding at any time that are otherwise Eligible Accounts, and which
are identified by Administrative Borrower to Agent in writing, may be included
in Eligible Accounts without such letter of credit support;
          (m) any Account owed in any currency other than US Dollars or Canadian
Dollars;
          (n) any Account owed by (i) the government (or any department, agency,
public corporation, or instrumentality thereof) of any country other than the
United States or Canada, unless such Account is backed by a letter of credit
acceptable to Agent and which has been assigned to and is directly

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drawable by Agent, or (ii) the government of the United States or Canada, or any
department, agency, public corporation, or instrumentality thereof, unless the
Federal Assignment of Claims Act of 1940, as amended, or the Financial
Administration Act (Canada), as amended, as applicable, and any other steps
necessary to perfect the security interest and lien of Agent in such Account
have been complied with to Agent’s satisfaction;
          (o) any Account owed by any Affiliate, employee, officer, director or
agent of any Borrower or Guarantor;
          (p) any Account of an account debtor that exceeds two (2%) percent of
all Eligible Accounts, in respect of which the credit limit, if any, as to such
account debtor determined by the applicable Borrower from time to time, and such
credit limit is acceptable to Agent (and otherwise such credit limit as Agent
may determine after notice and consultation with Administrative Borrower), is
exceeded by more than ten (10%) percent of the amount of such credit limit for
thirty (30) days, to the extent of such excess;
          (q) any Account owed by an account debtor or any Affiliate of such
account debtor to which any Borrower or Guarantor is indebted, but only to the
extent of such indebtedness, or which is subject to any security, deposit,
progress payment, retainage or other similar advance made by or for the benefit
of an account debtor, in each case to the extent thereof;
          (r) any Account subject to any counterclaim, deduction, defense,
setoff or dispute (including, without limitation, with respect to any of the
foregoing, in the form of a rebate or warranty claim), in each case to the
extent thereof as determined by Agent in its reasonable discretion;
          (s) any Account evidenced by or arising under any promissory note,
lease, chattel paper, or instrument;
          (t) any Account owed by an account debtor located in any jurisdiction
which requires filing of a “Notice of Business Activities Report” or other
similar report in order to permit such Person to seek judicial enforcement in
such jurisdiction of payment of such Account, unless such Person has filed such
report or qualified to do business in such jurisdiction;
          (u) any Account with respect to which such Person has made any
agreement with the account debtor for any reduction thereof (to the extent of
such reduction), other than discounts and adjustments given in the ordinary
course of business, or any Account which was partially paid and such Person
created a new receivable for the unpaid portion of such Account;
          (v) any Account that does not comply in all material respects with the
requirements of all applicable laws and regulations, whether Federal, State,
Provincial, territorial or local, including without limitation the Federal
Consumer Credit Protection Act, the Federal Truth in Lending Act and
Regulation Z of the Board;
          (w) any Account arising from goods that have been sold under a
purchase order or pursuant to the terms of a contract or other agreement or
understanding (written or oral) that indicates or purports to indicate that any
Person other than such Person has or has had an ownership interest in such
goods, or which indicates any party other than such Person as payee or
remittance party;
          (x) any Account created on cash on delivery terms; or

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          (y) any Account that Agent determines may not be paid by reason of the
account debtor’s inability to pay (including, without limitation, all Accounts
classified by Borrowers as “Legals” in accordance with their current practices).
The criteria for Eligible Accounts set forth above may only be changed and any
new criteria for Eligible Accounts may only be established by Agent in its
reasonable discretion, upon not less than one (1) Business Days’ prior written
notice to Administrative Borrower, based on either: (i) an event, condition or
other circumstance arising after the date hereof, or (ii) an event, condition or
other circumstance existing on the date hereof to the extent that the Agent has
no knowledge thereof or its effect on the Account, in either case under clause
(i) or (ii) which adversely affects or would reasonably be expected to adversely
affect the Accounts as determined by Agent in its reasonable discretion. Any
Accounts that are not Eligible Accounts shall nevertheless be part of the
Collateral.
     1.66 “Eligible Domestic In-Transit Inventory” shall mean Inventory that
would otherwise be Eligible Inventory (other than for its location) that has
been shipped from a location of any Borrower or from the manufacturer or
wholesale distributor thereof within the United States or Canada for receipt at
a location of any Borrower within the United States or Canada and permitted
hereunder, within thirty (30) days of shipment, but in either case, which has
not yet been delivered to such Borrower, for which the purchase order is in the
name of a Borrower, title has passed to such Borrower (and Agent has received
such evidence thereof as it has requested) and which is insured in accordance
with the terms of this Agreement, subject to the limits set forth in the
definitions of Canadian Borrowing Base and US Borrowing Base.
     1.67 “Eligible Equipment” shall mean Equipment owned by any Borrower that
is located in the United States of America or Canada and that is in each case
included in an appraisal of Equipment received by Agent in accordance with the
requirements of Agent, which Equipment is in good order, repair, running and
marketable condition (ordinary wear and tear excepted) which in each case
satisfy the criteria set forth below. Eligible Equipment shall not include:
(a) Equipment at premises other than those owned or leased and controlled by any
Borrower; provided, that, as to locations that are leased by a Borrower, if
Agent shall not have received a Collateral Access Agreement from the owner and
lessor of such location, duly authorized, executed and delivered by such owner
and lessor (or Agent shall have determined to accept a Collateral Access
Agreement that does not include all required provisions or provisions in the
form otherwise required by Agent), Agent may, at its option, establish such
Reserves in respect of amounts at any time due or to become due to the owner and
lessor thereof not to exceed the aggregate amount payable for the next three
(3) months to the owner or lessor of such locations; (b) Equipment subject to a
security interest or lien in favor of any person other than Agent except for
Permitted Liens; (c) Equipment that is not located in the continental United
States of America or in Canada; (d) Equipment that is not subject to the first
priority, valid and perfected security interest of Agent; (e) worn-out,
obsolete, damaged or defective Equipment or Equipment not in good order and
repair and used or usable in the ordinary course of such Borrower’s business as
presently conducted; (f) computer hardware; or (g) Equipment that is or becomes
a fixture to any Real Property. The criteria for Eligible Equipment set forth
above may only be changed and any new criteria for Eligible Equipment may only
be established by Agent in its reasonable discretion, upon not less than one
(1) Business Days’ prior written notice to Administrative Borrower, based on
either an event, condition or other circumstance (i) arising after the date
hereof, or (ii) existing on the date hereof to the extent Agent has no knowledge
thereof or of its effect on the Equipment, in each case which adversely affects
or would reasonably be expected to adversely affect the Equipment in the good
faith determination of Agent. Any Equipment that is not Eligible Equipment shall
nevertheless be part of the Collateral.

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     1.68 “Eligible Inventory” shall mean, as to each Borrower, Inventory of
such Borrower consisting of raw materials and finished goods held for resale in
the ordinary course of the business of such Borrower that satisfy the criteria
set forth below. Eligible Inventory shall not include:
          (a) any Inventory that is not subject to a first priority perfected
security interest in favor of Agent;
          (b) any Inventory that is subject to any security interest, lien or
other encumbrance other than the security interest and lien of Agent and those
permitted in clauses (b), (c) and (k) of Section 10.2 (but as to liens referred
to in clause (k) only to the extent that Agent has established a Reserve as
provided therein) and any other liens permitted under this Agreement that are
subject to an intercreditor agreement in form and substance satisfactory to
Agent between the holder of such security interest or lien and Agent;
          (c) any Inventory that is slow moving or obsolete (with Inventory as
to which a supply of more than twelve (12) months is then on hand being deemed
to be obsolete or slow moving for this purpose to the extent of any such excess
supply).
          (d) any Inventory that, in Agent’s opinion, is slow moving, obsolete,
unmerchantable, defective, used, unfit for sale, not salable at prices
approximating at least the cost of such Inventory in the ordinary course of
business;
          (e) any Inventory with respect to which any covenant, representation,
or warranty contained in this Agreement or any of the other Loan Documents has
been breached or is not true in any material respect or which does not conform
to all standards imposed by any Governmental Authority;
          (f) any Inventory which any Person other than such Person shall
(i) have any direct or indirect ownership, interest or title to such Inventory
or (ii) be indicated on any purchase order or invoice with respect to such
Inventory as having or purporting to have an interest therein;
          (g) any Inventory that constitutes work-in-process (except Painted
Coil of up to the limits set forth in the definitions of Canadian Borrowing Base
and US Borrowing Base), spare or replacement parts, subassemblies, packaging and
shipping material, manufacturing supplies, samples, prototypes, displays or
display items, bill-and-hold goods, goods that have been returned for repair,
replacement or refurbishment, used, repaired or refurbished goods, repossessed
goods, unmerchantable, defective or damages goods, goods unfit for sale, goods
held on consignment, goods which are not of a type held for sale in the ordinary
course of business, goods not salable at prices approximating at least eighty
(80%) percent of the cost of such Inventory in the ordinary course of business;
          (h) any Inventory that is not located at premises owned or leased and
controlled by any Borrower, except for Eligible Domestic In-Transit Inventory
and except as set forth in clause (i) below;
          (i) any Inventory located in any location leased by such Person or its
Affiliates unless (i) the lessor (and its mortgagee, if any) has delivered to
Agent a Collateral Access Agreement or (ii) a Reserve for rent, charges, and
other amounts due or to become due with respect to such facility has been
established by Agent (except to the extent not required in accordance with the
definition of “Reserves” hereunder);
          (j) (i) other than in respect of Inventory with an aggregate value of
up to $1,000,000 at such times that no Default or Event of Default exists or has
occurred and is continuing, any Inventory located in any third party warehouse
or is in the possession of a bailee or is being processed offsite at a third
party location or outside processor and, in any such case, is not evidenced by a
document of title,

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unless (ii) such warehouseman or bailee or the owner of such third party
location or such outside processor has delivered to Agent a Collateral Access
Agreement reasonably acceptable to it and such other documentation as Agent may
reasonably require or (iii) an appropriate Reserve has been established by
Agent;
          (k) any Inventory that is a discontinued product or component thereof
and is not immediately usable in a continuing product;
          (l) any Inventory that is the subject of a consignment by such Person
as consignor;
          (m) any Inventory that contains or bears any intellectual property
rights licensed to such Person unless Agent is satisfied that it may sell or
otherwise dispose of such Inventory without (i) infringing the rights of such
licensor, (ii) violating any contract with such licensor, or (iii) incurring any
liability with respect to payment of royalties other than royalties incurred
pursuant to sale of such Inventory under the current licensing agreement; and
          (n) any Inventory that is not reflected in a current perpetual
inventory report of such Person (other than finished goods window Inventory
located at facilities of Associated Materials LLC, as reflected in the
reconciliation of the perpetual inventory and general ledger in accordance with
Section 7.1(a)(ii) hereof).
The criteria for Eligible Inventory set forth above may only be changed and any
new criteria for Eligible Inventory may only be established by Agent in its
reasonable discretion, upon not less than one (1) Business Days’ prior written
notice to Administrative Borrower, based on either: (i) an event, condition or
other circumstance arising after the date hereof, or (ii) an event, condition or
other circumstance existing on the date hereof to the extent that the Agent has
no knowledge thereof or of its effect on Inventory, in either case under clause
(i) or (ii) which adversely affects or would reasonably be expected to adversely
affect the Inventory as determined by Agent in good faith. Any Inventory that is
not Eligible Inventory shall nevertheless be part of the Collateral.
     1.69 “Eligible Real Property” shall mean Real Property owned by a US
Borrower or a Canadian Borrower in fee simple and included in an appraisal of
Real Property received by Agent in accordance with the requirements of Agent and
in each case which satisfies the criteria set forth below. Eligible Real
Property shall not include: (a) Real Property which is not owned and operated by
a Borrower; (b) Real Property subject to a security interest, lien or mortgage
or other encumbrance in favor of any person other than Agent, except Permitted
Liens (but not including for the purpose of this exception (i) any purchase
money security interests or liens that may be permitted under this Agreement, or
(ii) other security interests or liens that would have priority over the
security interests of Agent or are not subject to an intercreditor agreement in
form and substance satisfactory to Agent between the holder of such lien and
Agent); (c) Real Property that is not located in the continental United States
of America or Canada; (d) Real Property that is not subject to the valid and
enforceable, first priority (subject to Permitted Liens and as provided in
clause (b) above), perfected security interest, lien and mortgage of Agent;
(e) Real Property in respect of which Agent has not received an appraisal in
form and substance satisfactory to Agent and by an appraiser acceptable to
Agent; (f) Real Property where Agent determines in its reasonable discretion
that issues relating to compliance with Environmental Laws adversely affect in
any material respect the value thereof or the ability of Agent to sell or
otherwise dispose thereof (but subject to the right of Agent to establish
Reserves upon the inclusion of such Real Property as Eligible Real Property in
the calculation of the Fixed Asset Availability to reflect such adverse affect);
and (g) Real Property improved with residential housing. Any Real Property which
is not Eligible Real Property shall nevertheless be part of the Collateral.

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     1.70 “Eligible Transferee” shall mean (a) any Lender; (b) the parent
company of any Lender and/or any Affiliate of such Lender which is at least
fifty (50%) percent owned by such Lender or its parent company; (c) any person
(whether a corporation, partnership, trust or otherwise) that is an Approved
Fund, and in each case under clauses (a) and (b) above, is approved by Agent
(provided, that, subject to Section 15.7 hereof , such person shall not include
any person that has been designated in writing by Administrative Borrower to
Agent prior to the date hereof as unacceptable); and (d) any other commercial
bank, financial institution or “accredited investor” (as defined in Regulation D
under the Securities Act of 1933) approved by Agent; provided, that, (i) neither
any Borrower nor any Guarantor or any Affiliate of any Borrower or Guarantor
shall qualify as an Eligible Transferee and (ii) no Person to whom any
Indebtedness which is in any way subordinated in right of payment to any other
Indebtedness of any Borrower or Guarantor shall qualify as an Eligible
Transferee, except as Agent and Required Lenders may otherwise specifically
agree.
     1.71 “Environmental Laws” shall mean all foreign, Federal, State,
Provincial and local laws (including common law), legislation, rules, codes,
licenses, permits (including any conditions imposed therein), authorizations,
binding judicial or administrative decisions, injunctions or agreements between
any Borrower or Guarantor and any Governmental Authority, (a) relating to
pollution and the protection, preservation or restoration of the environment
(including air, water vapor, surface water, ground water, drinking water,
drinking water supply, surface land, subsurface land, plant and animal life or
any other natural resource), or to public health or exposure to Hazardous
Materials, (b) relating to the use, storage, recycling, treatment, generation,
manufacture, processing, distribution, transportation, handling, labeling,
production, release or disposal, or threatened release, of Hazardous Materials,
or (c) relating to all laws with regard to recordkeeping, notification,
disclosure and reporting requirements respecting Hazardous Materials as now or
may at any time be in effect during the term of this Agreement.
     1.72 “Equipment” shall mean, as to each Borrower and Guarantor, all of such
Borrower’s and Guarantor’s now owned and hereafter acquired equipment, wherever
located, including machinery, data processing and computer equipment (whether
owned or licensed and including embedded software), vehicles, tools, furniture,
fixtures, all attachments, accessions and property now or hereafter affixed
thereto or used in connection therewith, and substitutions and replacements
thereof, wherever located.
     1.73 “Equipment Availability” shall mean, collectively, the US Equipment
Availability and the Canadian Equipment Availability.
     1.74 “Equity Interests” shall mean, with respect to any Person, all of the
shares, interests, participations or other equivalents (however designated) of
such Person’s Equity Interests or partnership, limited liability company or
other equity, ownership or profit interests at any time outstanding, all of the
warrants, options or other rights for the purchase or acquisition from such
Person of shares of Equity Interests of (or other interests in) such Person, all
of the securities convertible into or exchangeable for shares of Equity
Interests of (or other interests in) such Person or warrants, rights or options
for the purchase or acquisition from such Person of such shares (or such other
interests), but excluding any interests in phantom equity plans and any debt
security that is convertible into or exchangeable for such shares, and all of
the other ownership or profit interests in such Person (including partnership,
member or trust interests therein), whether voting or nonvoting, and whether or
not such shares, warrants, options, rights or other interests are outstanding on
any date of determination.
     1.75 “ERISA” shall mean the Employee Retirement Income Security Act of
1974, together with all rules, regulations and interpretations thereunder or
related thereto.

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     1.76 “ERISA Affiliate” shall mean any person required to be aggregated with
any Borrower, any Guarantor or any of its or their respective Subsidiaries under
Sections 414(b), 414(c), 414(m) or 414(o) of the Code.
     1.77 “ERISA Event” shall mean (a) any “reportable event”, as defined in
Section 4043(c) of ERISA or the regulations issued thereunder, with respect to a
Pension Plan, other than events as to which the requirement of notice has been
waived in regulations by the Pension Benefit Guaranty Corporation; (b) the
adoption of any amendment to a Pension Plan that would require the provision of
security pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA;
(c) a complete or partial withdrawal by any Borrower, Guarantor or any ERISA
Affiliate from a Multiemployer Plan or a cessation of operations which is
treated as such a withdrawal or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the treatment
of a Pension Plan amendment as a termination under Section 4041 or 4041A of
ERISA, or the commencement of proceedings by the Pension Benefit Guaranty
Corporation to terminate a Pension Plan; (e) an event or condition which might
reasonably be expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan; (f) the
imposition of any liability under Title IV of ERISA, other than the Pension
Benefit Guaranty Corporation premiums due but not delinquent under Section 4007
of ERISA, upon any Borrower, Guarantor or any ERISA Affiliate in excess of
$1,000,000 and (g) any other event or condition with respect to a Plan including
any Pension Plan subject to Title IV of ERISA maintained, or contributed to, by
any ERISA Affiliate that could reasonably be expected to result in liability of
any Borrower in excess of $1,000,000.
     1.78 “Eurodollar Rate Loans” shall mean any Loans or portion thereof on
which interest is payable based on the Adjusted Eurodollar Rate in accordance
with the terms hereof.
     1.79 “Event of Default” shall mean the occurrence or existence of any event
or condition described in Section 12.1 hereof.
     1.80 “Exchange Act” shall mean the Securities Exchange Act of 1934,
together with all rules, regulations and interpretations thereunder or related
thereto.
     1.81 “Exchange Rate” shall mean the prevailing spot rate of exchange of
such bank as Agent may reasonably select for the purpose of conversion of one
currency to another, at or around 11:00 a.m. New York time, on the date on which
any such conversion of currency is to be made under this Agreement.
     1.82 “Excluded Collateral” shall have the meaning given to such term in
Section 5.3(c).
     1.83 “Existing Lenders” shall mean the lenders under the Existing Credit
Agreement (and including UBS AG, Stamford Branch, in its capacity as agent
acting for such lenders) and their respective predecessors, successors and
assigns.
     1.84 “Existing Credit Agreement” shall mean the Amended and Restated Credit
Agreement, dated December 22, 2004, by and among Associated Materials
Incorporated, as U.S. Borrower, Gentek Building Products Limited, as Canadian
Borrower, AMH Holdings, Inc. and Associated Materials Holdings Inc., as
Guarantors, the financial institutions party thereto as lenders, UBS AG,
Stamford Branch, as U.S. Administrative Agent, Canadian Imperial Bank of
Commerce, as Canadian Administrative Agent, Citigroup Global Markets Inc., as
Syndication Agent, General Electric Capital Corporation and National City Bank,
as Co-Documentation Agents, and UBS Securities LLC and Citigroup Global Markets
Inc., as Joint Lead Arrangers, as amended.

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     1.85 “Existing Letters of Credit” shall mean, collectively, the letters of
credit issued for the account of a Borrower or Guarantor or for which such
Borrower or Guarantor is otherwise liable listed on Schedule 1.85 hereto, as the
same now exist or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.
     1.86 “Federal Funds Rate” shall mean, for any period, a fluctuating
interest rate per annum equal, for each day during such period, to the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal Funds transactions with members of the Federal Reserve System
arranged by Federal Funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day on such transactions
received by the Agent from three Federal Funds brokers of recognized standing
selected by it.
     1.87 “Fee Letter” shall mean the letter agreement, dated of even date
herewith, by and among Borrowers, Guarantors and Agent, setting forth certain
fees payable by Borrowers to Agent Wachovia and Arrangers, as the same now
exists or may hereafter be amended, modified, supplemented, extended, renewed,
restated or replaced.
     1.88 “Fixed Asset Availability” shall mean, collectively, the Equipment
Availability and the Real Property Availability.
     1.89 “Fixed Charge Coverage Ratio” shall mean, with respect to any date of
determination, the ratio of (a) EBITDA of any Person or its Subsidiaries on a
consolidated basis minus the sum of (i) Capital Expenditures of such Person and
its Subsidiaries to the extent not financed by a third party, plus (ii) net cash
income taxes paid by such Person and its Subsidiaries, plus (iii) cash
dividends, distributions and share repurchases or redemptions of such Person and
its Subsidiaries to (b) Fixed Charges of such Person and its Subsidiaries, for
such period.
     1.90 “Fixed Charges” shall mean, as to any Person and its Subsidiaries, on
a consolidated basis, with respect to any period, the sum of, without
duplication, (a) all Interest Expense, plus (b) all regularly scheduled (as
determined at the beginning of the respective period) principal payments of
Indebtedness for borrowed money (including any reductions in Fixed Asset
Availability hereunder), Indebtedness for the deferred purchase price of any
property or services to the extent paid, including, without limitation, any
indemnification, adjustment of purchase price, earn-outs or other similar
obligations incurred in connection with a Permitted Acquisition or Permitted
Disposition (but excluding an account payable to a trade creditor (whether or
not an Affiliate) incurred in the ordinary course of business of such Person and
payable in accordance with customary trade practices), Indebtedness with respect
to Capital Leases (and without duplicating in items (a) and (b) of this
definition, the interest component with respect to Indebtedness under Capital
Leases).
     1.91 “Foreign Lender” shall mean any Lender that is organized under the
laws of a jurisdiction other than that in which a Borrower is resident for tax
purposes. For purposes of this definition, the United States of America, each
State thereof and the District of Columbia shall be deemed to constitute a
single jurisdiction, and Canada and each province and territory thereof shall be
deemed to constitute a single jurisdiction.
     1.92 “Foreign Subsidiary” shall have the meaning given to such term in
Section 5.3(c) hereof.

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     1.93 “GAAP” shall mean generally accepted accounting principles in the
United States of America as in effect from time to time as set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and the statements and pronouncements
of the Financial Accounting Standards Board which are applicable to the
circumstances as of the date of determination consistently applied; except,
that, unless otherwise agreed by Agent, for purposes of Section 11 hereof, GAAP
shall be determined on the basis of such principles in effect on the date hereof
and consistent with those used in the preparation of the most recent audited
financial statements delivered to Agent prior to the date hereof, subject,
however, in the case of determination of compliance with the financial covenants
in Section 11, to the provisions of Section 15.2(h) hereof.
     1.94 “Global Availability Test Condition” shall mean (a) prior to the time
Fixed Asset Availability is zero (0): (i) Global Excess Availability of
Borrowers equals not less than twenty (20%) percent of the Maximum Credit,
(ii) Canadian Excess Availability equals not less than fifteen (15%) percent of
the Canadian Loan Limit and (iii) US Excess Availability equals not less than
fifteen (15%) percent of the US Loan Limit and (b) after such time as Fixed
Asset Availability is zero (0): (i) Global Excess Availability of Borrowers
equals not less than fifteen (15%) percent of the Maximum Credit, (ii) Canadian
Excess Availability equals not less than twelve and one-half (12 1/2%) percent
of the Canadian Loan Limit and (iii) US Excess Availability equals not less than
twelve and one-half (12 1/2%) percent of the US Loan Limit.
     1.95 “Global Excess Availability” shall mean the amount, as determined by
Agent, calculated at any date, equal to: (a) the lesser of: (i) the aggregate of
the US Borrowing Base and the Canadian Borrowing Base and (ii) the Maximum
Credit (in each case under (i) or (ii) after giving effect to any Reserves other
than any Reserves in respect of Letter of Credit Obligations), minus (b) the sum
of: (i) the amount of all then outstanding and unpaid Obligations (but not
including for this purpose Obligations arising pursuant to any guarantees in
favor of Agent and Lenders of the Obligations of the other Borrowers or any
outstanding Letter of Credit Obligations), plus (ii) the amount of all Reserves
then established in respect of Letter of Credit Obligations, plus (iii) the
aggregate amount in excess of $500,000 of all then outstanding and unpaid trade
payables and other obligations of Borrowers which are outstanding more than
sixty (60) days past due as of the end of the immediately preceding month or at
Agent’s option, as of a more recent date based on such reports as Agent may from
time to time specify (other than trade payables or other obligations being
contested or disputed by Borrowers in good faith), plus (iv) without
duplication, the amount of checks issued by Borrowers to pay trade payables and
other obligations which are more than sixty (60) days past due as of the end of
the immediately preceding month or at Agent’s option, as of a more recent date
based on such reports as Agent may from time to time specify (other than trade
payables or other obligations being contested or disputed by Borrowers in good
faith), but not yet sent.
     1.96 “Governmental Authority” shall mean the government of the United
States of America, Canada, or any other nation or any political subdivision
thereof, whether state or local, provincial or territorial, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra-national body exercising such function, such as the European Union or the
European Central Bank).
     1.97 “Guarantors” shall mean, collectively, the following (together with
their respective successors and assigns): (a) Associated Materials Holdings,
LLC, a Delaware limited liability company; (b) Gentek Holdings, LLC, a Delaware
limited liability company; (c) Alside, Inc., a Delaware corporation, and (d) any
other Person that at any time after the date hereof becomes party to a guarantee
in favor of Agent or any Lender or otherwise liable on or with respect to the
Obligations or who is the owner of any property which is security for the
Obligations (other than Borrowers); each sometimes being referred to herein
individually as a “Guarantor”.

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     1.98 “Guaranty Obligations” shall mean, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of any other Person in
any manner, whether direct or indirect, and including, without limitation, any
obligation, whether or not contingent, (a) to purchase any such Indebtedness or
any property constituting security therefor, (b) to advance or provide funds or
other support for the payment or purchase of any such Indebtedness or to
maintain working capital, solvency or other balance sheet condition of such
other Person (including, without limitation, keep-well agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for the
benefit of any holder of Indebtedness of such other Person, (c) to lease or
purchase property, securities or services primarily for the purpose of assuring
the holder of such Indebtedness, or (d) to otherwise assure or hold harmless the
holder of such Indebtedness against loss in respect thereof. The amount of any
Guaranty Obligation hereunder shall (subject to any limitations set forth
therein) be deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Indebtedness in respect of which
such Guaranty Obligation is made.
     1.99 “Harvest Partners” means Harvest Partners, Inc., a New York
corporation, and its successors and assigns.
     1.100 “Hazardous Materials” shall mean any hazardous, toxic or dangerous
substances, materials and wastes, including hydrocarbons, petroleum, crude oil,
or any fraction thereof; flammable explosives, asbestos and asbestos-containing
materials, urea formaldehyde insulation, radioactive materials, biological
substances, polychlorinated biphenyls, pesticides, herbicides and any other kind
and/or type of pollutants, contaminants, materials which include hazardous
constituents and/or any other similar substances, materials, or wastes that are
or become regulated or are or become classified as hazardous or toxic under any
Environmental Law.
     1.101 “Hedge Agreement” shall mean an agreement between any Borrower or
Guarantor and Agent or any Bank Product Provider that is a swap agreement as
such term is defined in 11 U.S.C. Section 101, and including any rate swap
agreement, basis swap, forward rate agreement, commodity swap, interest rate
option, forward foreign exchange agreement, spot foreign exchange agreement,
rate cap agreement rate, floor agreement, rate collar agreement, currency swap
agreement, cross-currency rate swap agreement, currency option, and any other
similar agreement (including any option to enter into any of the foregoing or a
master agreement for any the foregoing together with all supplements thereto)
entered into for the purpose of protecting against or managing exposure to
fluctuations in interest or exchange rates, currency valuations or commodity
prices; sometimes being collectively referred to herein as “Hedge Agreements”.
     1.102 “Holdings I Documents” shall mean, individually and collectively, the
Holdings I Indenture, the Holdings I Notes and all agreements, documents and
instruments executed and/or delivered in connection therewith, as the foregoing
now exist or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.
     1.103 “Holdings I Indenture” shall mean the Indenture Governing the 11.25%
Senior Discount Notes, dated March 4. 2004, between AMH Holdings, LLC, as
issuer, and Wilmington Trust Company, as trustee, as the same now exists or may
hereafter be amended, modified, supplemented, extended, renewed, restated or
replaced.
     1.104 “Holdings I Notes” shall mean the 11.25% Senior Discount Notes due
2014 issued by AMH Holdings, LLC pursuant to the Holdings I Indenture, as the
same now exist or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.

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     1.105 “Holdings II Documents” shall mean, individually and collectively,
the Holdings II Indenture, the Holdings II Notes and all agreements, documents
and instruments executed and/or delivered in connection therewith, as the
foregoing now exist or may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced.
     1.106 “Holdings II Indenture” shall mean the Indenture governing the
13.625% Senior Notes due 2014, dated December 22, 2004, between AMH Holdings II,
Inc., as issuer, and U.S. Bank, National Association, as trustee, as the same
now exists or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.
     1.107 “Holdings II Notes” shall mean the 13.625% Senior Notes due 2014
issued by AMH Holdings II, Inc. pursuant to the Holdings II Indenture, as the
same now exist or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.
     1.108 “Indebtedness” shall mean, with respect to any Person, without
duplication, (a) all obligations of such Person for borrowed money, (b) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, (c) all obligations of such Person upon which interest charges are
customarily paid or accrued, (d) all obligations of such Person under
conditional sale or other title retention agreements relating to property
purchased by such Person (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary course of
business), (e) all obligations of such Person issued or assumed as the deferred
purchase price of property or services purchased by such Person which are due
six (6) months or more from the date after such property is acquired or such
services are completed, and including, without limitation, customary
indemnification, adjustment of purchase price or similar obligations, earn-outs
or other similar obligations, in each case, incurred in connection with a
Permitted Disposition (but excluding trade debt and accrued expenses incurred in
the ordinary course of business on normal trade terms and not overdue by more
than ninety (90) days) which would appear as liabilities on a balance sheet of
such Person in accordance with GAAP, (f) all obligations of such Person under
take-or-pay or similar arrangements or under commodities agreements, (g) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any security
interest in, lien or other encumbrance upon, or payable out of the proceeds of
production from property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (h) all Guaranty Obligations of
such Person with respect to Indebtedness of another Person, (i) the principal
portion of all Capitalized Lease Obligations of such Person, (j) all obligations
of such Person under Hedge Agreements, (k) the maximum amount of all standby
letters of credit issued or bankers’ acceptances facilities created for the
account of such Person and, without duplication, all drafts drawn thereunder (to
the extent unreimbursed), (l) all preferred Equity Interests issued by such
Person and which by the terms thereof could be (at the request of the holders
thereof or otherwise) subject to mandatory sinking fund payments, redemption or
other acceleration prior to the date which is ninety-one (91) days after the
Maturity Date and other Disqualified Equity Interests, (m) the principal balance
outstanding under any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing product and
(n) the Indebtedness of any partnership or unincorporated joint venture in which
such Person is a general partner or a joint venturer, but only to the extent
such Person is liable for such Indebtedness.
     1.109 “Information Certificate” shall mean, collectively, the Information
Certificates of Borrowers and Guarantors constituting Exhibit C hereto
containing material information with respect to Borrowers and Guarantors, their
respective businesses and assets provided by or on behalf of Borrowers and
Guarantors to Agent in connection with the preparation of this Agreement and the
other Loan Documents and the financing arrangements provided for herein.

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     1.110 “Intellectual Property” shall mean, as to each Borrower and
Guarantor, such Borrower’s and Guarantor’s now owned and hereafter arising or
acquired: patents, patent rights, patent applications, copyrights, works which
are the subject matter of copyrights, copyright applications, copyright
registrations, trademarks, servicemarks, trade names, trade styles, trademark
and service mark applications, and licenses and rights to use any of the
foregoing and all applications, registrations and recordings relating to any of
the foregoing as may be filed in the Canadian Intellectual property Office or
any similar office or agency of Canada, any Province thereof and any political
subdivision thereof, the United States Copyright Office, the United States
Patent and Trademark Office or in any similar office or agency of the United
States, any State thereof, any political subdivision thereof or in any other
country or jurisdiction, together with all rights and privileges arising under
applicable law with respect to any Borrower’s or Guarantor’s use of any of the
foregoing; all extensions, renewals, reissues, divisions, continuations, and
continuations-in-part of any of the foregoing; all rights to sue for past,
present and future infringement of any of the foregoing; inventions, trade
secrets, formulae, processes, compounds, drawings, designs, blueprints, surveys,
reports, manuals, and operating standards; goodwill (including any goodwill
associated with any trademark or servicemark, or the license of any trademark or
servicemark); customer and other lists in whatever form maintained; trade secret
rights, copyright rights, rights in works of authorship, domain names and domain
name registration; software and contract rights relating to computer software
programs, in whatever form created or maintained.
     1.111 “Interest Expense” shall mean, for any period, as to any Person, as
determined in accordance with GAAP, the amount equal to total interest expense,
net of interest income, of such Person and its Subsidiaries on a consolidated
basis for such period, whether paid or payable in cash (including the interest
component of any Capital Lease for such period but not interest expense in the
form of payments-in-kind or amortization in respect of deferred financing fees),
and in any event, including, without limitation, (a) bank fees, commissions,
discounts and other fees and charges owed with respect to letters of credit,
banker’s acceptances or similar instruments or any factoring, securitization or
similar arrangements, and (b) the costs or fees for such period associated with
Hedge Agreements in respect of interest rate swaps to the extent not otherwise
included in such total interest expense (excluding breakage costs incurred in
connection with the termination of Hedging Agreements on or about the date
hereof, if any); provided, that, Interest Expense shall be determined after
giving effect to the net payments and receipts for such period under Hedging
Agreements in respect of interest rate swaps.
     1.112 “Interest Period” shall mean for any Eurodollar Rate Loan, a period
of approximately one (1), two (2), three (3), or six (6) months duration (and,
if acceptable to all Lenders nine (9) or twelve (12) months duration) as any
Borrower or Administrative Borrower on behalf of such Borrower) may elect, the
exact duration to be determined in accordance with the customary practice in the
applicable Eurodollar Rate market; provided, that, such Borrower (or
Administrative Borrower on behalf of such Borrower) may not elect an Interest
Period which will end after the last day of the then-current term of this
Agreement.
     1.113 “Interest Rate” shall mean,
          (a) Subject to clause (b) of this definition below:
               (i) as to Base Rate Loans that are US Base Rate Loans and Swing
Line Loans, a rate equal to the then Applicable Margin for Base Rate Loans on a
per annum basis plus the US Base Rate,
               (ii) as to Base Rate Loans that are Canadian Base Rate Loans, a
rate equal to the then Applicable Margin for Base Rate Loans on a per annum
basis plus the Canadian Base Rate, and

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               (iii) as to Eurodollar Rate Loans, a rate equal to the then
Applicable Margin for Eurodollar Rate Loans on a per annum basis plus the
Adjusted Eurodollar Rate.
          (b) Notwithstanding anything to the contrary contained herein,
               (i) Agent may, at its option, and Agent shall, at the direction
of the Required Lenders, increase the Applicable Margin otherwise used to
calculate the Interest Rate for Base Rate Loans, Eurodollar Rate Loans and Swing
Line Loans by two (2%) percent per annum, for the period from and after the date
of the occurrence of an Event of Default but only for so long as such Event of
Default is continuing; and
               (ii) Agent may, at its option, and Agent shall, at the direction
of the Required Lenders, increase the Applicable Margin otherwise used to
calculate the Interest Rate for Base Rate Loans, Eurodollar Rate Loans and Swing
Line Loans by two (2%) percent per annum, on Revolving Loans or Swing Line Loans
at any time outstanding in the aggregate in excess of the Canadian Borrowing
Base and/or the US Borrowing Base (in each case whether or not such excess(es)
arise or are made with or without the knowledge or consent of Agent or any
Lender and whether made before or after an Event of Default).
     1.114 “Inventory” shall mean, as to each Borrower and Guarantor, all of
such Borrower’s and Guarantor’s now owned and hereafter existing or acquired
goods, wherever located, which (a) are leased by such Borrower or Guarantor as
lessor; (b) are held by such Borrower or Guarantor for sale or lease or to be
furnished under a contract of service; (c) are furnished by such Borrower or
Guarantor under a contract of service; or (d) consist of raw materials, work in
process, finished goods or materials used or consumed in its business.
     1.115 “Investcorp” shall mean Investcorp S.A., a limited liability company
incorporated in the Grand Duchy of Luxembourg, together with its successors and
assigns.
     1.116 “Investment” shall have the meaning set forth in Section 10.4 hereof.
     1.117 “Investment Property Control Agreement” shall mean an agreement in
writing, in form and substance reasonably satisfactory to Agent, by and among
Agent, any Borrower or Guarantor (as the case may be) and any securities
intermediary, commodity intermediary or other person who has custody, control or
possession of any investment property of such Borrower or Guarantor
acknowledging that such securities intermediary, commodity intermediary or other
person has custody, control or possession of such investment property on behalf
of Agent, that it will comply with entitlement orders originated by Agent with
respect to such investment property, or other instructions of Agent, and has
such other terms and conditions as Agent may reasonably require.
     1.118 “Issuing Bank” shall mean Canadian Issuing Bank or US Issuing Bank,
as the case may be.
     1.119 “Lenders” shall mean the financial institutions who are signatories
hereto as Lenders and other persons made a party to this Agreement as a Lender
in accordance with Section 15.7 hereof, and their respective successors and
assigns; each sometimes being referred to herein individually as a “Lender”.
     1.120 “Letter of Credit Documents” shall mean, with respect to any Letter
of Credit, such Letter of Credit, any amendments thereto, any documents
delivered in connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents (whether general in application or
applicable only to such Letter of Credit) governing or providing for (a) the
rights and obligations of the parties concerned or at risk or (b) any collateral
security for such obligations.

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     1.121 “Letter of Credit Limit” shall mean $25,000,000.
     1.122 “Letter of Credit Obligations” shall mean, at any time, the sum of
(a) the aggregate undrawn amount of all Letters of Credit outstanding at such
time, plus (b) the aggregate amount of all drawings under Letters of Credit for
which Issuing Bank has not at such time been reimbursed, plus (c) without
duplication, the aggregate amount of all payments made by each Lender to Issuing
Bank with respect to such Lender’s participation in Letters of Credit as
provided in Section 2.3 for which Borrowers have not at such time reimbursed the
Lenders, whether by way of a Revolving Loan or otherwise.
     1.123 “Letters of Credit” shall mean all letters of credit denominated in
US Dollars or Canadian Dollars (whether documentary or stand-by and whether for
the purchase of inventory, equipment or otherwise) issued by an Issuing Bank for
the account of any Borrower pursuant to this Agreement, and all amendments,
renewals, extensions or replacements thereof and including, but not limited to,
the Existing Letters of Credit.
     1.124 “License Agreements” shall have the meaning set forth in Section 8.11
hereof.
     1.125 “Loans” shall mean, collectively, the Revolving Loans and the Swing
Line Loans.
     1.126 “Loan Documents” shall mean, collectively, this Agreement and all
notes, guarantees, security agreements, hypothecs, deposit account control
agreements, investment property control agreements, intercreditor agreements and
all other agreements, documents and instruments now or at any time hereafter
executed and/or delivered by any Borrower or Guarantor in connection with this
Agreement; provided, that, the Loan Documents shall not include Hedge
Agreements.
     1.127 “London Interbank Offered Rate” shall mean, with respect to any
Eurodollar Rate Loan for the Interest Period applicable thereto, the rate
appearing on Reuters Screen LIBOR01 Page (or on any successor or substitute page
of such service, or any successor to or substitute for such service, providing
rate quotations comparable to those currently provided on such page of such
service, as determined by Agent from time to time for purposes of providing
quotations of interest rates applicable to eurodollar deposits in dollars in the
London interbank market) at approximately 11:00 A.M. (London time) two
(2) Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period; provided, that, if more than one rate is
specified on such Page for such comparable period, the applicable rate shall be
the arithmetic mean of all such rates. In the event that such rate is not
available at such time for any reason, then the term “London Interbank Offered
Rate” shall mean, with respect to any Eurodollar Rate Loan for the Interest
Period applicable thereto, the rate of interest per annum at which dollar
deposits of $5,000,000 and for a term comparable to such Interest Period are
offered by the principal London office of Agent in immediately available funds
in the London interbank market at approximately 11:00 a.m. London time two
(2) Business Days prior to the commencement of such Interest Period.
     1.128 “Material Adverse Effect” shall mean a material adverse change in
(a) the business, assets, liabilities, results of operations, property or
financial condition of Borrowers and Guarantors taken as a whole; (b) the
ability of any Borrower or any Guarantor to perform its obligations, when such
obligations are required to be performed, under the Loan Documents; (c) the
validity or enforceability of any of the Loan Documents or the rights or
remedies of Agent or the Lenders under the Loan Agreement or any of the other
Loan Documents or the perfection or priority of any lien in favor of the Agent;
or (d) the ability of Agent or any Lender to enforce the obligations owing to it
or realize upon the Collateral or otherwise with respect to the rights and
remedies of Agent and Lenders under any of the Loan Documents.

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     1.129 “Material Contract” shall mean (a) any contract or other agreement
(other than the Loan Documents and Hedge Agreements), written or oral, of any
Borrower or Guarantor involving monetary liability of or to any Person in an
amount in excess of the US Dollar Equivalent of $10,000,000 in any fiscal year
(but excluding for this purpose contracts or other agreements for the purchase
and sale of goods or services where the other party thereto has no obligation to
purchase or sell such goods or services under such contract or other agreement)
and (b) any other contract or other agreement (other than the Loan Documents and
Hedge Agreements), whether written or oral, to which any Borrower or Guarantor
is a party as to which the breach, nonperformance, cancellation or failure to
renew by any party thereto would have a Material Adverse Effect.
     1.130 “Maturity Date” shall mean October 3, 2013; except, that, in the
event the obligations of Borrowers and Guarantors with respect to the Opco Notes
remain outstanding as of the date that is six (6) months prior to the stated
maturity date of the Opco Notes, then the Maturity Date shall be the date six
(6) months prior to the stated maturity date of the Opco Notes.
     1.131 “Maximum Credit” shall mean the amount of $225,000,000 (subject to
adjustment as provided in Section 2.6 hereof).
     1.132 “Maximum Credit Increase Effective Date” shall have the meaning set
forth in Section 2.6(c) hereof.
     1.133 “Maximum Interest Rate” shall mean the maximum non-usurious rate of
interest under applicable Federal or State law as in effect from time to time
that may be contracted for, taken, reserved, charged or received in respect of
the indebtedness of a Borrower to Agent or a Lender, or to the extent that at
any time such applicable law may thereafter permit a higher maximum non-usurious
rate of interest, then such higher rate.
     1.134 “Moody’s” shall mean Moody’s Investors Service, Inc., and its
successors and assigns.
     1.135 “Mortgages” shall mean, individually and collectively, each of the
following (as the same now exist or may hereafter be amended, modified,
supplemented, extended, renewed, restated or replaced): (a) the Open End
Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing,
dated of even date herewith, by Associated in favor of Agent with respect to the
Real Property and related assets of such Borrower located in West Salem and
Cuyahoga Falls, Ohio, (b) the Open End Mortgage, Assignment of Leases and Rents,
Security Agreement and Fixture Filing, dated of even date herewith, by
Associated in favor of Agent with respect to the Real Property and related
assets of such Borrower located in Akron, Ohio, (c) the Deed of Trust,
Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated of
even date herewith, by Associated in favor of Agent with respect to the Real
Property and related assets of such Borrower located in Ennis, Texas, (d) the
Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture
Filing,, dated of even date herewith, by Associated in favor of Agent with
respect to the Real Property and related assets of such Borrower located in
Yuma, Arizona, (e) the Mortgage, dated of even date herewith, by Canadian
Borrower in favor of Agent with respect to the Real Property and related assets
of such Borrower located in Burlington and London, Ontario and (f) the Deed of
Hypothec, dated of even date herewith, by Gentek in favor of Agent with respect
to the Real Property and related assets of such Borrower located in Point
Claire, Quebec.
     1.136 “Multiemployer Plan” shall mean a “multi-employer plan” as defined in
Section 4001(a)(3) of ERISA which is or was at any time during the current year
or the immediately preceding six (6) years contributed to by any Borrower,
Guarantor or any ERISA Affiliate or with respect to which any Borrower,
Guarantor or any ERISA Affiliate may incur any liability.

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     1.137 “Net Cash Proceeds” shall mean the aggregate cash proceeds received
by Parent or any of its Subsidiaries in respect of any sale, lease, transfer or
other disposition of any assets or properties, or interest in assets and
properties or as proceeds of any loans or other financial accommodations
provided to it or as proceeds from the issuance and/or sale of any Equity
Interests or Indebtedness, in each case net of the reasonable and customary
direct costs relating to such sale, lease, transfer or other disposition or
loans or other financial accommodation or issuance and/or sale (including,
without limitation, legal, accounting and investment banking fees, and sales
commissions) and taxes paid or payable as a result thereof and in the case of a
sale of any assets or properties or interest in assets and properties, amounts
applied to the repayment of Indebtedness secured by a valid and enforceable lien
(other than a lien created under the Loan Documents) on the asset or assets that
are the subject of such sale or other disposition required to be repaid in
connection with such transaction.
     1.138 “Net Recovery Percentage” shall mean the fraction, expressed as a
percentage, (a) the numerator of which is the amount equal to the amount of the
recovery in respect of the Inventory at such time on a “net orderly liquidation
value” basis as set forth in the most recent acceptable appraisal of Inventory
received by Agent in accordance with Section 7.3, net of estimated liquidation
expenses, and (b) the denominator of which is the applicable original cost of
the aggregate amount of the Inventory subject to such appraisal.
     1.139 “Obligations” shall mean, collectively, the US Obligations and
Canadian Obligations.
     1.140 “OFAC” means the U.S. Department of the Treasury’s Office of Foreign
Assets Control.
     1.141 “Opco Documents” shall mean, individually and collectively, the Opco
Indenture, the Opco Notes and all agreements, documents and instruments executed
and/or delivered in connection therewith, as the foregoing now exist or may
hereafter be amended, modified, supplemented, extended, renewed, restated or
replaced.
     1.142 “Opco Indenture” shall mean the Indenture governing the 9.75% Senior
Subordinated Notes due 2012, dated April 23, 2002, among Associated Materials
Incorporated, now known as Associated Materials, LLC, as issuer, the subsidiary
guarantor thereunder and Wilmington Trust Company, as trustee, as the same now
exists or may hereafter be amended, modified, supplemented, extended, renewed,
restated or replaced.
     1.143 “Opco Notes” shall mean the 9.75% Senior Subordinated Notes due 2012
issued by Associated Materials Incorporated, now known as Associated Materials,
LLC, pursuant to the Opco Indenture, in the aggregate original principal amount
of $165,000,000, as the same now exist or may hereafter be amended, modified,
supplemented, extended, renewed, restated or replaced.
     1.144 “Opco Permitted Payments” shall mean regularly scheduled payments of
interest, when due, and customary fees and expense reimbursements in respect of
the Opco Notes as in effect on the date hereof.
     1.145 “Other Taxes” shall mean any present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies of the
United States or any political subdivision thereof or any applicable foreign
jurisdiction, and all liabilities with respect thereto, in each case arising
from any payment made hereunder or under any of the other Loan Documents or from
the execution, delivery or registration of, or otherwise with respect to, this
Agreement or any of the other Loan Documents.

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     1.146 “Painted Coil” shall mean raw material Inventory consisting of uncut
aluminum and steel coil that has been painted.
     1.147 “Parent” shall mean Associated Materials Holdings, LLC, a Delaware
limited liability company, and its successors and assigns.
     1.148 “Participant” shall mean any financial institution that acquires and
holds a participation in the interest of any Lender in any of the Loans and
Letters of Credit in conformity with the provisions of Section 15.7 of this
Agreement governing participations.
     1.149 “Pension Plan” shall mean a pension plan (as defined in Section 3(2)
of ERISA) subject to Title IV of ERISA which any Borrower or Guarantor sponsors,
maintains, or to which any Borrower, Guarantor or ERISA Affiliate makes, is
making, or is obligated to make contributions, other than a Multiemployer Plan.
     1.150 “Permitted Acquisitions” shall mean the purchase by a Borrower after
the date hereof of all or substantially all of the assets of any Person or a
business or division of such Person (including pursuant to a merger with such
Person or the formation of a wholly owned Subsidiary solely for such purpose
that is merged with such Person) or of all or a majority of the Equity Interests
(such assets or Person being referred to herein as the “Acquired Business”) and
in one or a series of transaction that satisfies each of the following
conditions:
          (a) as of the date of the acquisition or any payment in respect
thereof and after giving effect to the acquisition or such payment, no Default
or Event of Default shall exist or have occurred and be continuing;
          (b) if the aggregate consideration paid or payable with respect to
such acquisition and all such acquisitions during each period of twelve
(12) consecutive calendar months does not exceed the US Dollar Equivalent of
$10,000,000 (which amount may be increased by the amount of any equity
contributions by the direct or indirect owners of Parent of up to the US Dollar
Equivalent of $5,000,000 contemporaneously applied to the purchase price of any
such acquisition), the Global Availability Test Condition shall be satisfied as
of the date of the acquisition or any payment in respect thereof and after
giving effect to the acquisition or such payment;
          (c) if the aggregate consideration paid or payable with respect to
such acquisition or all such acquisitions during any period of twelve
(12) consecutive calendar months exceeds the US Dollar Equivalent of $10,000,000
or such greater amount up to the US Dollar Equivalent of $15,000,000 pursuant to
Section 1.149(b) above, as applicable, then, without limitation upon
Section 1.149(d) below, (i) the sum of the US Excess Availability and the
Canadian Excess Availability shall have been not less than twenty (20%) percent
of the Maximum Credit for the period of ninety (90) consecutive days immediately
preceding the date of such acquisition, (ii) as of the date of such acquisition
and after giving effect thereto and to any payments in connection therewith and
to any increase in the Canadian Borrowing Base and the US Borrowing Base as a
result of such acquisition, using the most recent calculation of the Canadian
Borrowing Base and the US Borrowing Base prior to the date of any such payment,
on a pro forma basis, the sum of the US Excess Availability and the Canadian
Excess Availability shall be not less than twenty (20%) percent of the Maximum
Credit and (iii) Agent shall have received projections of Parent and its
Subsidiaries, in form and substance satisfactory to Agent, showing that (A) the
sum of the US Excess Availability and the Canadian Excess Availability shall be
not less than twenty (20%) percent of the Maximum Credit at all times during the
twelve (12) month period commencing as of the first day of the first full month
after such acquisition and (B) the Fixed Charge Coverage Ratio for Parent and
its Subsidiaries as of the date of such acquisition (for the immediately
preceding twelve (12) consecutive

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month period ended on such date) and after giving effect thereto, is equal to or
greater than 1.1:1.0, and is projected, pursuant to projections in form and
substance satisfactory to Agent, to be equal to or greater than 1.1 to 1.0 at
all times during the immediately succeeding twelve (12) consecutive month
period;
          (d) the aggregate amount of consideration paid in connection with
Permitted Acquisitions consummated during any period of twelve (12) consecutive
calendar months (such consideration to be deemed to include, without limitation,
cash, notes and other debt, maximum earnouts, consulting and non-compete
payments, Equity Interests issued and the like) during any period of twelve (12)
consecutive calendar months (but without duplication of), shall not exceed the
US Dollar Equivalent of US$25,000,000 (which amount may be increased by the
amount of any equity contributions by the direct or indirect owners of Parent of
up to the US Dollar Equivalent of $10,000,000 contemporaneously applied to the
purchase price of Permitted Acquisitions)for such period of twelve
(12) consecutive calendar months;
          (e) the Acquired Business is incorporated or organized under the laws
of a State within the United States or the laws of Canada or a province thereof;
          (f) the Acquired Business shall be a company that engages in a line of
business substantially similar to, or ancillary or related to, or used or useful
to, the business that a Borrower or a Guarantor is engaged in on the date
hereof;
          (g) in the case of the acquisition of the Equity Interests of another
Person, the board of directors (or other comparable governing body) of such
other Person shall have duly approved such acquisition and such Person shall not
have announced that it will oppose such acquisition and shall not have commenced
any action which alleges that such acquisition will violate applicable law;
          (h) Agent shall have received, not less than ten (10) Business Days’
prior written notice of the proposed acquisition and such information with
respect thereto as Agent may request, in each case with such information to
include (i) parties to such acquisition, (ii) the proposed date and amount of
the acquisition, (iii) a list and description of the assets or shares to be
acquired, and (iv) the total purchase price for the assets to be purchased (and
the terms of payment of such purchase price);
          (i) if a Borrower (or Administrative Borrower on behalf of such
Borrower) requests that any Accounts, Inventory or Equipment acquired pursuant
to such acquisition be included in the Canadian Borrowing Base and/or the US
Borrowing Base, Agent shall have completed a field examination with respect to
the business and assets of the Acquired Business in accordance with Agent’s
customary procedures and practices and as otherwise required by the nature and
circumstances of the business of the Acquired Business, the scope and results of
which shall be satisfactory to Agent and any Accounts, Inventory or Equipment of
the Acquired Business shall only be Eligible Accounts, Eligible Inventory or
Eligible Equipment, as the case may be, to the extent that Agent has so
completed such field examination with respect thereto and the criteria for
Eligible Accounts, Eligible Inventory and Eligible Equipment, as the case may
be, set forth herein are satisfied with respect thereto in accordance with this
Agreement (or such other or additional criteria as Agent may, at its option,
establish with respect thereto in accordance with the definitions of Eligible
Accounts, Eligible Inventory and Eligible Equipment, as applicable, and subject
to such Reserves as Agent may establish in connection with the Acquired Business
in accordance with the definition of such term, and in the case of Eligible
Inventory and Eligible Equipment acquired pursuant to a Permitted Acquisition to
the extent that it has been subject to an appraisal that satisfies the
requirements of Section 7.3 hereof); provided, that, in no event shall any such
Equipment constitute Eligible Equipment to the extent that (i) the Value of such
Equipment acquired in any period of twelve (12) consecutive calendar months
exceeds the US Dollar Equivalent of $3,750,000, or (ii) the addition of such
Equipment as Eligible Equipment would increase the US Equipment Availability or
the Canadian Equipment Availability above the respective amounts thereof on the
date hereof;

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          (j) if the aggregate consideration paid or payable with respect to
such acquisition or all such acquisitions during any period of twelve
(12) consecutive calendar months exceeds the US Dollar Equivalent of
$10,000,000, and at the request of Agent in any case, Agent shall have received
either (i) the audited consolidated financial statements with respect to the
Acquired Business for the three (3) fiscal years most recently ended for which
financial statements are available, together with an unqualified opinion of
independent certified public accountants, and interim unaudited consolidated
financial statements with respect to the Acquired Business for each quarterly
period ended since the last audited financial statements for which financial
statements are available, or (ii) if any of such audited financial statements
and opinions are not available, such unaudited financial statements or reviewed
financial statements with respect to the Acquired Business for such fiscal years
as may have been prepared, or (iii) such other historical financial statements
with respect to the Acquired Business as may be acceptable to Agent;
          (k) Agent shall have received a certificate of the chief financial
officer or chief executive officer of Borrower certifying to Agent that such
transaction complies with this definition; and
          (l) if the aggregate consideration paid or payable with respect to
such acquisition or all such acquisitions during any period of twelve
(12) consecutive calendar months exceeds the US Dollar Equivalent of
$10,000,000, and at the request of Agent in any case, upon Agent’s request,
Agent shall have received (i) copies of all material agreements pertaining to
such transaction, and (ii) all such other information and data relating to such
transaction or the Acquired Business as may be reasonably requested by Agent.
     1.151 “Permitted Dispositions” shall mean each of the following:
          (a) sales of Inventory in the ordinary course of business;
          (b) the sale or other disposition of used, worn-out or obsolete
Equipment, Real Property and interests in Equipment and Real Property that are
no longer used or useful in the conduct of the business of Borrowers and
Guarantors; provided, that, only to the extent that any of the foregoing
includes Eligible Equipment or Eligible Real Property, the Canadian Fixed Asset
Availability and/or the US Fixed Asset Availability, as the case may be, shall
be reduced by an amount equal to the greater of (i) the applicable Net Cash
Proceeds of the disposition thereof by or on behalf of such Borrowers and
(ii) the amount advanced hereunder based upon such Equipment or Real Property as
reduced by the amortization set forth in the definitions of Canadian Real
Property Availability, US Real Property Availability, Canadian Equipment
Availability and US Equipment Availability, as applicable; provided, further,
that, in each case at any time a Cash Dominion Event exists, all of the Net Cash
Proceeds of the sale or other disposition shall be paid to Agent for application
to the Obligations in accordance with the terms hereof;
          (c) the sale or other disposition of property by Parent or any
Subsidiary thereof to a Borrower or Guarantor; provided, that, if the transferor
of such property is a Borrower or Guarantor (i) the transferee thereof must be
(A) a Borrower if the transferor is a Borrower or (B) a Borrower or Guarantor if
the transferor is a Guarantor, (ii) to the extent such transaction constitutes
an Investment, such transaction is permitted under Section 10.4 hereof and
(iii) to the extent of any security interests and lien of Agent with respect to
such property prior to its sale or other disposition, the security interest and
lien of Agent on such property shall continue in all respects and shall not be
deemed released or terminated as a result of such sale or other disposition and
Borrowers and Guarantors shall execute and deliver such agreements, documents
and instruments as Agent may request with respect thereto;

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          (d) the grant by Parent and its Subsidiaries after the date hereof of
a license of any Intellectual Property owned by Parent and its Subsidiaries;
provided, that, such license is on a non-exclusive basis, the rights of the
licensee shall be subject to the rights of Agent, and shall not adversely
affect, limit or restrict the rights of Agent to use any Intellectual Property
of Parent and its Subsidiaries to sell or otherwise dispose of any Inventory or
other Collateral or otherwise adversely limit or interfere in any respect with
the use of any such trademarks by Agent in connection with the exercise of its
rights or remedies hereunder or under any of the other Loan Documents, and as of
the date of the grant of any such license, and after giving effect thereto, no
Default or Event of Default shall exist or have occurred and be continuing;
          (e) the issuance and sale by Parent and its Subsidiaries of Equity
Interests of Parent and its Subsidiaries after the date hereof for cash;
provided, that, (i) Parent and its Subsidiaries shall not be required to pay any
cash dividends or repurchase or redeem such Equity Interests or make any other
payments in respect thereof, except as otherwise permitted in Section 10.5
hereof, (ii) except as Agent may otherwise agree in writing, and other than for
the issuance of Equity Interests as provided in clauses (h) and (i) below, all
of the Net Cash Proceeds of the sale and issuance of such Equity Interests shall
be paid to Agent for application to the Obligations in accordance with the terms
hereof and (iii) as of the date of such issuance and sale and after giving
effect thereto, no Default or Event of Default shall exist or have occurred and
be continuing;
          (f) the issuance of Equity Interests of Parent consisting of common
stock pursuant to an employee stock option or grant or similar equity plan or
401(k) plans of such Parent for the benefit of its employees, directors and
consultants; provided, that, in no event shall Parent be required to issue, or
shall Parent issue, Equity Interests pursuant to such stock plans or 401(k)
plans which would result in a Change of Control or other Default or Event of
Default;
          (g) the abandonment or other disposition of Intellectual Property that
is not material and is no longer used or useful in any material respect in the
business of any Borrower, Guarantor or their Subsidiaries or is not economically
practical to maintain and is of minimal value, and does not appear on is or
otherwise not affixed to or incorporated in any Inventory or necessary in
connection with the Records or have any material value; provided, that, as of
the date of such abandonment or other disposition and after giving effect
thereto, no Default or Event of Default shall exist or have occurred and be
continuing;
          (h) any transfer of property or assets, or issuance of Equity
Interests, that is a Restricted Payment permitted under Section 10.5 or
Permitted Investment permitted under Section 10.4;
          (i) the transfer of cash for the payment of Indebtedness to the extent
such payments are permitted hereunder and for the payment of other payables in
the ordinary course of the business of Borrowers and Guarantors;
          (j) the sale of Accounts not constituting Eligible Accounts in
connection with the collection or compromise thereof in the ordinary course of
business of Borrowers and Guarantors, in an aggregate amount not to exceed the
US Dollar Equivalent of US$4,000,000 in any period of twelve (12) consecutive
months in the ordinary course of business of Parent and its Subsidiaries;
provided, that, as of the date of each such sale and after giving effect thereto
(i) no Default or Event of Default shall exist or have occurred and be
continuing, (ii) Global Excess Availability shall be not less than fifteen (15%)
percent of the Maximum Credit, (iii) US Excess Availability shall be not less
than fifteen (15%) percent of the US Loan Limit, and (iv) Canadian Excess
Availability shall be not less than fifteen (15%) percent of the Canadian Loan
Limit;

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          (k) the sale or other disposition of Cash Equivalents or Canadian Cash
Equivalents for fair market value provided the proceeds thereof are applied in
accordance with the terms hereof;
          (l) the disposition of other assets having a fair market value of
$75,000 or less (not to exceed $750,000 in any period of twelve (12) consecutive
calendar months);
          (m) sales or other dispositions of assets of Parent and its
Subsidiaries not otherwise subject to the provisions set forth in this
definition; provided, that, as to any such sale or other disposition, each of
the following conditions is satisfied:
               (i) not less than seventy-five (75%) percent of the consideration
to be received by Borrowers and Guarantors shall be paid or payable in cash and
shall be paid contemporaneously with consummation of the transaction;
               (ii) the aggregate of value of all assets disposed of pursuant to
this Section 1.150(m) shall not exceed the US Dollar Equivalent of $13,000,000
in any twelve (12) consecutive calendar month period or the US Dollar Equivalent
of $25,000,000 during the term hereof;
               (iii) the consideration paid or payable shall be in an amount not
less than the fair market value of the property disposed of;
               (iv) such transaction does not involve the sale or other
disposition of any Equity Interest in any Subsidiary or of Receivables other
than Receivables owned by or attributable to other property concurrently being
disposed of in a transaction otherwise constituting a Permitted Disposition (but
in no event constituting Accounts of a Borrower);
               (v) as of the date of such sale or other disposition and after
giving effect thereto, the Global Availability Test Condition shall be
satisfied;
               (vi) at any time a Cash Dominion Event exists, the Net Cash
Proceeds from any such sale or other disposition, shall be applied to the
Obligations (without permanent reduction thereof); and
               (vii) as of the date of any such sale or other disposition, and
in each case after giving effect thereto, no Event of Default shall exist or
have occurred and be continuing.
     1.152 “Permitted Holders” shall mean, collectively, Harvest Partners and
Investcorp, their respective controlled affiliates and funds controlled by
Harvest Partners, Investcorp and such affiliates (“control” (and its
derivatives) of a Person, for the purposes of this definition of “Permitted
Holders” means the power, directly or indirectly, to direct or cause the
direction of the management, policies and investment decisions of such Person
whether by contract or otherwise)).
     1.153 “Permitted Investments” shall mean each of the following:
          (a) Investments consisting of accounts receivables owing to any
Borrower or Guarantor if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary terms;
          (b) the endorsement of instruments for collection or deposit in the
ordinary course of business;

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          (c) Investments in cash, Cash Equivalents or Canadian Cash Equivalents
on the date hereof or at any other time that a Global Excess Availability shall
be not less than fifteen (15%) percent of the Maximum Credit, subject in each
case to the execution and delivery of an Investment Property Control Agreement
with respect thereto;
          (d) deposits of cash for leases, utilities, worker’s compensation and
similar matters in the ordinary course of business;
          (e) obligations under Hedge Agreements permitted under Section 10.3(j)
hereof;
          (f) receivables owing to Parent or any of its Subsidiaries if created
or acquired in the ordinary course of business consistent with current practices
as of the date hereof;
          (g) the existing Investments of Parent and its Subsidiaries as of the
date hereof in their respective Subsidiaries; provided, that, Parent and its
Subsidiaries shall not have any further obligations or liabilities to make any
capital contributions or other additional investments or other payments to or in
or for the benefit of any of such Subsidiaries;
          (h) additional Investments held by Parent or any of its Subsidiaries
in any non-wholly-owned Subsidiary solely to the extent that such Investments
reflect an increase in the stockholders’ equity of such Subsidiary resulting
from retained earnings of such Subsidiary;
          (i) loans and advances by Parent and its Subsidiaries to directors,
officers and employees of Parent and its Subsidiaries in the ordinary course of
business for bona fide (including, without limitation, in connection with the
purchase of Equity Interests by such directors, officers and employees) business
purposes not in excess of $3,000,000 at any time outstanding not evidenced by a
note, or if so evidenced, pledged to Agent upon its request at any time an Event
of Default exists or has occurred and is continuing;
          (j) stock or obligations issued to Parent and its Subsidiaries by any
Person (or the representative of such Person) in respect of Indebtedness of such
Person owing to Parent and its Subsidiaries in connection with the insolvency,
bankruptcy, receivership or reorganization of such Person or a composition or
readjustment of the debts of such Person; provided, that, the original of any
such stock or instrument evidencing such obligations shall be promptly delivered
to Agent, upon Agent’s request, together with such stock power, assignment or
endorsement by Parent and its Subsidiaries as Agent may request;
          (k) obligations of account debtors to Parent and its Subsidiaries
arising from Accounts which are past due evidenced by a promissory note made by
such account debtor payable to Parent and its Subsidiaries; provided, that,
promptly upon the receipt of the original of any such promissory note in an
amount greater than $250,000 individually from any single account debtor or
$1,000,000 in the aggregate from all account debtors (or regardless of the
amount after an Event of Default exists or has occurred and is continuing, at
the request of Agent) by Parent and its Subsidiaries, such promissory note shall
be endorsed to the order of Agent by Parent and its Subsidiaries and promptly
delivered to Agent as so endorsed;
          (l) loans, advances and other Investments by a Borrower or Guarantor
to or in a Borrower or Guarantor, after the date hereof; provided, that, as to
any such Investments, to the extent any assets (including cash) subject to the
security interests, liens and hypothecs of Agent for itself and for the benefit
of the Secured Parties are to be so transferred in respect of such Investment,
each of the following conditions is satisfied: (i) to the extent that such
Investment gives rise to any Indebtedness, such

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Indebtedness is permitted hereunder, (ii) to the extent that such Investment
gives rise to the issuance of any Equity Interests, such issuance is permitted
hereunder, (iii) as of the date of any such Investment and after giving effect
thereto, no Default or Event of Default shall exist or have occurred and be
continuing and (iv) (A) if the Person making the loan, advance or other
Investment is a US Borrower or US Guarantor, then as of the date thereof and
after giving effect thereto, US Excess Availability shall be not less than seven
(7%) percent of the US Loan Limit, (B) if the Person making the loan, advance or
other Investment is a Canadian Borrower or Canadian Guarantor, then as of the
date thereof and after giving effect thereto, Canadian Excess Availability shall
be not less than seven (7%) percent of the Canadian Loan Limit, (C) no
repayments in respect of any such loan, advance or other Investment shall be
made, directly or indirectly, in any form, or any funds or assets set aside
therefor, prior to the date that is sixty (60) days after the date of such loan,
advance or other Investment (provided that such repayments may be made at any
time after the date of such loan, advance, or other Investment if, in addition
to the other requirements for the repayment thereof set forth in
Section 1.154(l), after giving effect thereto, Canadian Excess Availability
shall be not less than fifteen (15%) percent of the Canadian Loan Limit and US
Excess Availability shall be not less than fifteen (15%) percent of the US Loan
Limit), (D) any repayment by a US Borrower or US Guarantor in respect of any
such loan, advance or other Investment shall only be made if as of the date
thereof and after giving effect thereto, US Excess Availability shall be not
less than seven (7%) percent of the US Loan Limit, and (E) any repayment by a
Canadian Borrower or Canadian Guarantor in respect of any such loan, advance or
other Investment shall only be made if as of the date thereof and after giving
effect thereto, Canadian Excess Availability shall be not less than seven (7%)
percent of the Canadian Loan Limit;
          (m) Investments constituting Restricted Payments permitted by
Section 10.5;
          (n) Investments permitted under Section 10.4;
          (o) [Intentionally omitted];
          (p) Investments made by Parent or any other Borrower or Guarantor as a
result of the receipt of non-cash consideration in connection with any Permitted
Disposition made in compliance with Section 10.1(b) hereof;
          (q) Investments in respect of loans or extensions of credit made by
Parent or Associated (“Management Loans”) to employees, officers, directors or
consultants (“Management Investors”) of Parent and its Subsidiaries in
connection with its purchase of newly issued Equity Interests of Parent or
direct or indirect parent company thereof (or any Borrowers or Guarantors)
(“Management Shares”), so long as the proceeds of such loans (if any) are used
concurrently dollar-for-dollar for the purchase of such Management Shares and
then contributed concurrently by Parent (or by such direct or indirect parent
company to Parent and then by Parent) as a capital contribution to Associated;
          (r) Investments by US Borrowers in the form of intercompany loans
permitted hereunder, in each case as to which the proceeds are used
contemporaneously to make payments otherwise permitted under Section 10.5
hereof; and
          (s) Investments after the date hereof by Parent and its Subsidiaries
in or to any Person (including, without limitation, a joint venture, partnership
or other similar arrangement, whether in corporate, partnership or other legal
form) not otherwise subject to the provisions above or in Section 10.4 and in an
aggregate amount not to exceed the US Dollar Equivalent of $15,000,000 during
the term hereof; provided, that, as to any such Investment, each of the
following conditions is satisfied:

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               (i) as of the date of the Investment or any payment in respect
thereof and after giving effect to the Investment or such payment, no Default or
Event of Default shall exist or have occurred and be continuing;
               (ii) as of the date of the Investment or any payment in respect
thereof and after giving effect to the Investment or such payment, the Global
Availability Test Condition shall be satisfied;
               (iii) the Investment shall be in or to a company that engages in
a line of business substantially similar to, or ancillary or related to, or used
or useful to, the business that Borrowers are engaged in on the date hereof;
               (iv) Agent shall have received not less than ten (10) Business
Days’ prior written notice of the proposed Investment and such information with
respect thereto as Agent may request, in each case with such information to
include (A) parties to such Investment, (B) the proposed date and amount of the
Investment, and (C) the total amount of the Investment;
               (v) Agent shall have received a certificate of the chief
financial officer or chief executive officer of Administrative Borrower
certifying to Agent and Lenders that such transaction complies with this
definition;
               (vi) upon Agent’s request, Agent shall have received (A) a
reasonably detailed description of all material information relating to such
acquisition and copies of all material documentation pertaining to such
transaction, and (B) all such other information and data relating to such
transaction as may be reasonably requested by Agent; and
               (vii) to the extent that the aggregate amount of such Investments
exceed the US Dollar Equivalent of $2,000,000 in any period of twelve
(12) consecutive calendar months or the US Dollar Equivalent of $5,000,000
during the term hereof, then as to any such Investment (each, an Excess
Investment”), in addition to the satisfaction of each of the other requirements
set forth in this Section 1.154, (A) for the twelve (12) consecutive calendar
month period immediately preceding the date of such Excess Investment and as of
the date of such Excess Investment and after giving effect thereto, the
aggregate availability Excess Availability of Borrowers shall be not less that
thirty-five (35%) percent of the Maximum Credit, (B) for the twelve
(12) consecutive calendar month period immediately preceding the date of such
Excess Investment and as of the date of such Excess Investment and after giving
effect thereto, the Excess Availability of US Borrowers shall be not less that
thirty-five (35%) percent of the US Loan Limit, (C) for the twelve
(12) consecutive calendar month period immediately preceding the date of such
Excess Investment and as of the date of such Excess Investment and after giving
effect thereto, the Excess Availability of Canadian Borrowers shall be not less
that thirty-five (35%) percent of the Canadian Loan Limit and (D) as of the
twelve (12) consecutive calendar month period immediately preceding the date of
such Excess Investment and after giving effect thereto the Fixed Charge Coverage
Ratio of Parent and its Subsidiaries, on a consolidated basis, shall be not less
than 1.2:1.0 and shall be projected, pursuant to projections in form and
substance satisfactory to Agent, to be not less than 1.2:1.0 throughout the
immediately succeeding twelve consecutive calendar month period (with Fixed
Charges calculated in each case for such purpose to include such Excess
Investment).
     1.154 “Permitted Liens” shall have the meaning set forth in Section 10.2
hereof.
     1.155 “Person” or “person” shall mean any individual, sole proprietorship,
partnership, corporation (including any corporation which elects subchapter S
status under the Code), limited liability company, unlimited liability company,
limited liability partnership, business trust, unincorporated association, joint
stock corporation, trust, joint venture or other entity or any government or any
agency or instrumentality or political subdivision thereof.

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     1.156 “Plan” shall mean an employee benefit plan (as defined in
Section 3(3) of ERISA) which any Borrower or Guarantor sponsors, maintains, or
to which it makes, is making, or is obligated to make contributions, or in the
case of a Multiemployer Plan has made contributions at any time during the
immediately preceding six (6) plan years or with respect to which any Borrower
or Guarantor may incur liability.
     1.157 “PPSA” shall mean the Personal Property Security Act (Ontario), the
Civil Code of Quebec or any other applicable Canadian Federal or Provincial
statute pertaining to the granting, perfecting, priority or ranking of security
interests, liens, hypothecs on personal property, and any successor statutes,
together with any regulations thereunder, in each case as in effect from time to
time. References to sections of the PPSA shall be construed to also refer to any
successor sections.
     1.158 “Priority Payables” shall mean, as to any Borrower or Guarantor at
any time, (a) the full amount of the liabilities of such Borrower or Guarantor
at such time which (i) have a trust imposed to provide for payment or a security
interest, pledge, lien or charge ranking or capable of ranking senior to or pari
passu with security interests, liens or charges securing the Obligations under
Federal, Provincial, State, county, district, municipal, or local law in Canada
or (ii) have a right imposed to provide for payment ranking or capable of
ranking senior to or pari passu with the Obligations under local or national
law, regulation or directive, including, but not limited to, claims for
unremitted and/or accelerated rents, taxes, wages, withholding taxes, VAT and
other amounts payable to an insolvency administrator, employee withholdings or
deductions and vacation pay, workers’ compensation obligations, government
royalties or pension fund obligations in each case to the extent such trust, or
security interest, lien or charge has been or may be imposed and (b) the amount
equal to the percentage applicable to Inventory in the calculation of the
Canadian Borrowing Base and the US Borrowing Base multiplied by the aggregate
Value of the Eligible Inventory which Agent, in good faith, considers is or may
be subject to retention of title by a supplier or a right of a supplier to
recover possession thereof, where such supplier’s right has priority over the
security interests, liens or charges securing the Obligations, including,
without limitation, Eligible Inventory subject to a right of a supplier to
repossess goods pursuant to Section 81.1 of the Bankruptcy and Insolvency Act
(Canada) or any applicable laws granting revendication or similar rights to
unpaid suppliers or any similar laws of Canada or any other applicable
jurisdiction (provided, that, to the extent such Inventory has been identified
and has been excluded from Eligible Inventory, the amount owing to the supplier
shall not be considered a Priority Payable).
     1.159 “Pro Rata Share” shall mean, as to any Lender, the fraction
(expressed as a percentage) the numerator of which is such Lender’s Commitment
and the denominator of which is the aggregate amount of all of the Commitments
of the Lenders, as adjusted from time to time in accordance with the provisions
hereof; provided, that, if the Commitments have been terminated, the numerator
shall be the unpaid amount of such Lender’s Loans and its interest in the Swing
Line Loans, Special Agent Advances and Letter of Credit Obligations and the
denominator shall be the aggregate amount of all unpaid Loans, Swing Line Loans,
Special Agent Advances and Letter of Credit Obligations.
     1.160 “Provision for Taxes” shall mean an amount equal to all taxes imposed
on or measured by net income, whether Federal, State, Provincial, county or
local, and whether foreign or domestic, that are paid or payable by any Person
in respect of any period in accordance with GAAP.
     1.161 “Quarterly Average Excess Availability” shall mean, for any three
(3) month period commencing on the first (1st) Business Day of the month of such
period, the sum of the daily average of (a) the US Excess Availability and
(b) the Canadian Excess Availability, for such period.

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     1.162 “Real Property” shall mean all now owned and hereafter acquired real
property of each Borrower and Guarantor, including leasehold interests, together
with all buildings, structures, and other improvements located thereon and all
licenses, easements and appurtenances relating thereto, wherever located,
including the real property and related assets more particularly described in
the Mortgages.
     1.163 “Real Property Availability” shall mean, collectively, the US Real
Property Availability and the Canadian Real Property Availability.
     1.164 “Receivables” shall mean all of the following now owned or hereafter
arising or acquired property of each Borrower and Guarantor: (a) all Accounts;
(b) all interest, fees, late charges, penalties, collection fees and other
amounts due or to become due or otherwise payable in connection with any
Account; (c) all payment intangibles of such Borrower or Guarantor; (d) letters
of credit, indemnities, guarantees, security or other deposits and proceeds
thereof issued payable to any Borrower or Guarantor or otherwise in favor of or
delivered to any Borrower or Guarantor in connection with any Account; or
(e) all other accounts, contract rights, chattel paper, instruments, notes,
general intangibles and other forms of obligations owing to any Borrower or
Guarantor, whether from the sale and lease of goods or other property, licensing
of any property (including Intellectual Property or other general intangibles),
rendition of services or from loans or advances by any Borrower or Guarantor or
to or for the benefit of any third person (including loans or advances to any
Affiliates or Subsidiaries of any Borrower or Guarantor) or otherwise associated
with any Accounts, Inventory or general intangibles of any Borrower or Guarantor
(including, without limitation, choses in action, causes of action, tax refunds,
tax refund claims, any funds which may become payable to any Borrower or
Guarantor in connection with the termination of any Plan or other employee
benefit plan and any other amounts payable to any Borrower or Guarantor from any
Plan or other employee benefit plan, rights and claims against carriers and
shippers, rights to indemnification, business interruption insurance and
proceeds thereof, casualty or any similar types of insurance and any proceeds
thereof and proceeds of insurance covering the lives of employees on which any
Borrower or Guarantor is a beneficiary).
     1.165 “Records” shall mean, as to each Borrower and Guarantor, all of such
Borrower’s and Guarantor’s present and future books of account of every kind or
nature, purchase and sale agreements, invoices, ledger cards, bills of lading
and other shipping evidence, statements, correspondence, memoranda, credit files
and other data relating to the Collateral or any account debtor, together with
the tapes, disks, diskettes and other data and software storage media and
devices, file cabinets or containers in or on which the foregoing are stored
(including any rights of any Borrower or Guarantor with respect to the foregoing
maintained with or by any other person).
     1.166 “Refinancing Indebtedness” shall have the meaning set forth in
Section 10.3(g) hereof.
     1.167 “Register” shall have the meaning set forth in Section 15.7 hereof.
     1.168 “Required Canadian Lenders” shall mean, at any time, those Canadian
Lenders whose Pro Rata Shares aggregate more than fifty (50%) percent of the
aggregate of the Canadian Commitments of all Canadian Lenders, or if the
Canadian Commitments shall have been terminated, Canadian Lenders to whom more
than fifty (50%) percent of the then outstanding Canadian Loans and
participation interests in other Obligations in respect of the Canadian Credit
Facility are owing.
     1.169 “Required Lenders” shall mean, at any time, those Lenders whose Pro
Rata Shares aggregate more than fifty (50%) percent of the aggregate of the
Commitments of all Lenders, or if the Commitments shall have been terminated,
Lenders to whom more than fifty (50%) percent of the then outstanding Loans and
participation interests in other Obligations are owing.

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     1.170 “Reserves” shall mean as of any date of determination, such amounts
as Agent may from time to time establish and revise in its reasonable
discretion, reducing the amount of Loans and Letters of Credit which would
otherwise be available to any Borrower under the lending formula(s) provided for
herein: (a) to reflect events, conditions, contingencies or risks which, as
determined by Agent in its reasonable discretion, adversely affect, or would
have a reasonable likelihood of adversely affecting, either (i) the Collateral
or any other property which is security for the Obligations, its value or the
amount that might be received by Agent from the sale or other disposition or
realization upon such Collateral, or (ii) the assets or business of any Borrower
or Guarantor or (iii) the security interests and other rights of Agent or any
Lender in the Collateral (including the enforceability, perfection and priority
thereof) or (b) to reflect Agent’s good faith belief that any collateral report
or financial information furnished by or on behalf of any Borrower or Guarantor
to Agent is incomplete, inaccurate or misleading in any material respect or
(c) in respect of any Default or an Event of Default. Without limiting the
generality of the foregoing, Reserves may be established to reflect any of the
following: (i) inventory shrinkage, (ii) reserves in respect of markdowns and
cost variances (pursuant to discrepancies between the purchase order price of
Inventory and the actual cost thereof), (iii) dilution with respect to Accounts
(based on the ratio of the aggregate amount of non-cash reductions in Accounts
for any period to the aggregate dollar amount of the sales of such Borrower for
such period) as calculated by Agent for any period is or is reasonably
anticipated to be greater than five (5%) percent, (iv) returns, discounts,
claims, credits and allowances of any nature that are not paid pursuant to the
reduction of Accounts, (v) the sales, excise or similar taxes included in the
amount of any Accounts reported to Agent and amounts due or to become due in
respect of sales, use and/or withholding taxes, (vi) any obligations of
Borrowers or Guarantors subject to superpriority liens under the Bankruptcy and
Insolvency Act (Canada), including Bill 55-C, C-12 or any successors thereto
with respect thereto (vii) reserves in respect of Priority Payables, and
(viii) any rental payments, service charges or other amounts due or to become
due to owners or lessors of real property to the extent Inventory or Records are
located in or on such property or in the possession or control of such parties
or such Records are needed to monitor or otherwise deal with the Collateral
(other than for locations where Agent has received a Collateral Access Agreement
executed and delivered by the owner and lessor of such real property); provided,
that, the Reserves established pursuant to this clause (vii) as to leased
locations shall not exceed at any time the aggregate of amounts payable for the
next three (3) months to the lessors of such locations and no Reserve shall be
established in respect of such leased locations in respect of which the
Inventory at all such locations in the aggregate has a value of $7,000,000 or
less, except, that, such limitations on the amount of the Reserves shall not
apply at any time that a Default or Event of Default shall exist or have
occurred and be continuing, or at any time there is any default or event of
default under the lease with respect to such location or a notice thereof has
been sent or received by or on behalf of any Borrower or Guarantor, (ix) any
rental payments, service charges or other amounts due or to become due to
lessors of personal property; (x) an increase in the number of days of the
turnover of Inventory or a change in the mix of the Inventory that results in an
overall decrease in the value thereof or a deterioration in its nature or
quality (but only to the extent not addressed by the lending formulas in a
manner satisfactory to Agent), (xi) variances between the perpetual inventory
records of Borrowers and the results of the test counts of Inventory conducted
by Agent with respect thereto in excess of the percentage acceptable to Agent,
(xii) the aggregate amount of deposits, if any, received by any Borrower from
its customers in respect of unfilled orders for goods, (xiii) Reserves to
reflect that the fair market value of the Eligible Equipment or Eligible Real
Property as set forth in the most recent acceptable appraisals received by Agent
with respect thereto has declined so that the then outstanding principal amount
of the Revolving Loans to any Borrower based on Fixed Asset Availability is
greater than such percentage with respect to such appraised values than Agent
used in establishing the original principal amount of the Loans in respect
thereof, (xiv) obligations, liabilities or indebtedness (contingent or
otherwise) of Borrowers or Guarantors to any Bank Product Provider arising under
or in connection with any Bank Products of any Borrower or Guarantor with a Bank
Product Provider or as such Bank Product Provider may otherwise require and
Agent may agree in connection therewith to the extent that such obligation,
liabilities or indebtedness constitute Obligations as such term is defined
herein

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or otherwise receive the benefit of the security interest of Agent in any
Collateral. To the extent that an event, condition or matter as to any Eligible
Accounts, Eligible Inventory, Eligible Equipment or Eligible Real Property is
addressed pursuant to the treatment thereof within the applicable definition of
such terms, Agent shall not also establish a Reserve to address the same event,
condition or matter. The amount of any Reserve established by Agent shall have a
reasonable relationship to the event, condition or other matter which is the
basis for such Reserve as determined by Agent in good faith and to the extent
that such Reserve is in respect of amounts that may be payable to third parties
Agent may, at its option, deduct such Reserve from the Maximum Credit at any
time that such limit is less than the amount of the sum of the Canadian
Borrowing Base and the US Borrowing Base.
     1.171 “Restricted Payment” shall mean any (a) dividend or other
distribution (whether in cash, securities or other property) with respect to any
Equity Interests of Parent or any of its Subsidiaries, or any payment (whether
in cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such Equity Interests or on account of any
return of capital to Parent or such Subsidiary’s stockholders, partners or
members (or the equivalent Person thereof), or payment made to redeem, purchase,
repurchase or retire, or to obtain the surrender of, any outstanding warrants,
options or other rights to acquire any Equity Interests of Parent or any of its
Subsidiaries, or any setting apart of funds or property for any of the
foregoing, and (b) the payment by Parent or any of its Subsidiaries of any
management, advisory or consulting fee to any Person or the payment of any
extraordinary salary, bonus or other form of compensation to any Person who is
directly or indirectly a significant partner, shareholder, owner or executive
officer of any such Person, to the extent such extraordinary salary, bonus or
other form of compensation is not included in the corporate overhead of Parent
or such Subsidiary, except in the case of each of the foregoing, as expressly
permitted pursuant to and in accordance with the terms of Section 10.6(d)
hereof.
     1.172 “Revolving Loans” shall mean the loans now or hereafter made by or on
behalf of any Lender or by Agent for the account of any Lender on a revolving
basis pursuant to the Credit Facility (involving advances, repayments and
readvances) as set forth in Section 2.1 hereof.
     1.173 “S&P” shall mean Standard & Poor’s Ratings Services, a division of
The McGraw-Hill Companies, Inc. and its successors and assigns.
     1.174 “Sanctioned Entity” shall mean (a) an agency of the government of,
(b) an organization directly or indirectly controlled by, or (c) a person
resident in, a country that is subject to a sanctions program identified on the
list maintained and published by OFAC and available at
http://www.treas.gov/offices/enforcement/ofac/programs, or as otherwise
published from time to time as such program may be applicable to such agency,
organization or person.
     1.175 “Sanctioned Person” shall mean a person named on the list of
Specially Designated Nationals or Blocked Persons maintained by OFAC available
at http://www.treas.gov/offices/enforcement/ofac/sdn/index.html, or as otherwise
published from time to time.
     1.176 “Secured Parties” shall mean, collectively, (a) Agent, (b) Lenders,
(c) the Issuing Bank and (d) any Bank Product Provider; provided, that, (i) as
to any Bank Product Provider, only to the extent of the Obligations owing to
such Bank Product Provider and (ii) such parties are sometimes referred to
herein individually as a “Secured Party”.

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     1.177 “Solvent” shall mean, at any time with respect to any Person, that at
such time such Person (a) is able to pay its debts as they mature and has (and
has a reasonable basis to believe it will continue to have) sufficient capital
(and not unreasonably small capital) to carry on its business consistent with
its practices as of the date hereof, and (b) the assets and properties of such
Person at a fair valuation (and including as assets for this purpose at a fair
valuation all rights of subrogation, contribution or indemnification arising
pursuant to any guarantees given by such Person) are greater than the
Indebtedness of such Person, and including subordinated and contingent
liabilities computed at the amount which, such person has a reasonable basis to
believe, represents an amount which can reasonably be expected to become an
actual or matured liability (and including as to contingent liabilities arising
pursuant to any guarantee the face amount of such liability as reduced to
reflect the probability of it becoming a matured liability).
     1.178 “Special Agent Advances” shall have the meaning set forth in
Section 14.11 hereof.
     1.179 “Sponsors” shall mean each of (a) Investcorp, (b) Harvest Partners
and (c) Weston Presidio, together with their respective successors and assigns;
each sometimes referred to herein individually as a “Sponsor”.
     1.180 “Subordinated Debt” shall mean any Indebtedness of a Borrower or
Guarantor that is subject to, and subordinate in right of payment to, the right
of Agent and Lenders to receive the prior final payment and satisfaction in cash
in full of all of the Obligations and subject to such other terms and conditions
as Agent may reasonably require with respect thereto.
     1.181 “Subsidiary” or “subsidiary” shall mean, with respect to any Person,
any corporation, limited liability company, limited liability partnership or
other limited or general partnership, trust, association or other business
entity of which an aggregate of at least a majority of the outstanding Equity
Interests or other interests entitled to vote in the election of the board of
directors of such corporation (irrespective of whether, at the time, Equity
Interests of any other class or classes of such corporation shall have or might
have voting power by reason of the happening of any contingency), managers,
trustees or other controlling persons, or an equivalent controlling interest
therein, of such Person is, at the time, directly or indirectly, owned by such
Person and/or one or more subsidiaries of such Person.
     1.182 “Swing Line Lender” shall mean, with respect to Swing Line Loans to a
US Borrower, Wachovia Bank, National Association and with respect to Swing Line
Loans to a Canadian Borrower, Wachovia Capital Finance Corporation (Canada), in
each case in its capacity as a lender of Swing Line Loans.
     1.183 “Swing Line Loan Limit” shall mean the US Dollar Equivalent of
$25,000,000.
     1.184 “Swing Line Loans” shall mean loans now or hereafter made by Swing
Line Lender on a revolving basis pursuant to the Credit Facility (involving
advances, repayments and readvances) as set forth in Section 2.2 hereof.
     1.185 “Taxes” shall mean any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of Agent, any Issuing Bank or any Lender,
(a) such taxes (including income taxes, franchise taxes, branch profits or
capital taxes) as are imposed on or measured by Agent’s, such Issuing Bank’s, or
such Lender’s net income or capital (or other taxes imposed in lieu thereof) by
any jurisdiction or political subdivision thereof and (b) all interest and
penalties imposed on Agent, such Issuing Bank or such Lender with respect to the
taxes described in clause (a) above.

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     1.186 “UCC” shall mean the Uniform Commercial Code as in effect in the
State of New York, and any successor statute, as in effect from time to time
(except that terms used herein which are defined in the Uniform Commercial Code
as in effect in the State of New York on the date hereof shall continue to have
the same meaning notwithstanding any replacement or amendment of such statute
except as Agent may otherwise determine).
     1.187 “US Base Rate” shall mean the higher of (a) the rate from time to
time publicly announced by Wachovia Bank, National Association, or its
successors, as its prime rate, whether or not such announced rate is the best
rate available at such bank or (b) the Federal Funds Effective Rate from time to
time plus one-half of one (0.50%) percent. The term “Federal Funds Effective
Rate” shall mean, for any period, a fluctuating interest rate per annum equal,
for each day during such period, to the weighted average of the rates on
overnight Federal Funds transactions with members of the Federal Reserve System
arranged by Federal Funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not published for any day that is a
Business Day, the average of the quotations for such day on such transactions
received by Agent from three Federal Funds brokers of recognized standing
selected by it.
     1.188 “US Base Rate Loans” shall mean any Loans or portion thereof
denominated in US Dollars and on which interest is payable based on the US Base
Rate in accordance with the terms thereof.
     1.189 “US Borrowers” shall mean, collectively, the following (together with
their respective successors and assigns): (a) Associated Materials, LLC, a
Delaware corporation; (b) Gentek Building Products, Inc., a Delaware
corporation; and (c) any other Person that at any time after the date hereof
becomes a US Borrower; each sometimes being referred to herein individually as a
“US Borrower”.
     1.190 “US Borrowing Base” shall mean, at any time the amount equal to:
          (a) the amount equal to: eighty-five (85%) percent of the Eligible
Accounts of US Borrowers, plus
          (b) the amount equal to the least of (i) the sum of (A) fifty (50%)
percent multiplied by the Value of Eligible Inventory of US Borrowers consisting
of raw materials other than Painted Coil, plus (B) the lesser of (1) thirty-five
(35%) percent multiplied by the Value of Eligible Inventory of US Borrower
consisting of Painted Coil, and (2) $2,500,000, plus (C) sixty (60%) percent
multiplied by the Value of Eligible Inventory of US Borrowers consisting of
finished goods or (ii) eighty-five (85%) percent of the Net Recovery Percentage
of the applicable category of Eligible Inventory of US Borrowers multiplied by
the Value of such Eligible Inventory or (iii) the US Inventory Loan Limit;
provided, that, the aggregate outstanding amount of Loans and Letters of Credit
that shall be provided to the US Borrowers based upon Eligible Inventory
consisting of Eligible Domestic In-Transit Inventory will not at any time exceed
the US Dollar Equivalent of $4,000,000, plus
          (c) the amount equal to the lesser of (i) the US Fixed Asset
Availability and (ii) the US Dollar Equivalent of $24,750,000; minus
          (d) Reserves attributable to US Borrowers.
     1.191 “US Collateral” shall mean all personal and real property and
fixtures, and interests in property and fixtures, of any US Loan Party, whether
now owned or hereafter acquired or existing, and wherever located.

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     1.192 “US Commitment” shall mean, at any time, as to each Lender, the
principal amount set forth below such Lender’s signature on the signatures pages
hereto designated as the US Commitment or on Schedule 1 to the Assignment and
Acceptance Agreement pursuant to which such Lender became a Lender hereunder in
accordance with the provisions of Section 15.7 hereof, as the same may be
adjusted from time to time in accordance with the terms hereof; sometimes being
collectively referred to herein as “US Commitments”.
     1.193 “US Credit Facility” shall mean the Loans and Letters of Credit
provided to or for the benefit of any US Borrower or a Guarantor pursuant to
Sections 2 hereof.
     1.194 “US Dollar Equivalent” shall mean at any time (a) as to any amount
denominated in US Dollars, the amount thereof at such time, and (b) as to any
amount denominated in any other currency, the equivalent amount in US Dollars
calculated by Agent in good faith at such time using the Exchange Rate in effect
on the Business Day of determination.
     1.195 “US Dollars”, “US$” and “$” shall each mean lawful currency of the
United States of America.
     1.196 “US Equipment Availability” shall mean eighty-five (85%) percent of
the net orderly liquidation value of Eligible Equipment of US Borrowers based
(a) as of the date hereof, upon the appraisal thereof in form and containing
assumptions and appraisal methods satisfactory to Agent, by an appraiser
acceptable to Agent and on which Agent’s specifically permitted to rely,
delivered to Agent on or before the date hereof and (b) after the date hereof,
on each subsequent appraisal of the Eligible Equipment of US Borrowers delivered
to Agent pursuant to Section 7.4 hereof; reduced as of November 1, 2008 and the
first (1st) day of each month thereafter during the term hereof by an amount
equal to one-sixtieth (1/60th) of the US Equipment Availability as of the date
hereof.
     1.197 “US Excess Availability” shall mean the amount, as determined by
Agent, calculated at any date, equal to: (a) the lesser of: (i) the US Borrowing
Base and (ii) the US Loan Limit (in each case under (i) or (ii) after giving
effect to any Reserves other than any Reserves in respect of US Letter of Credit
Obligations), minus (b) the sum of: (i) the amount of all then outstanding and
unpaid US Obligations (but not including for this purpose US Obligations arising
pursuant to any guarantees in favor of Agent and US Lenders of the US
Obligations of the other US Borrowers or any outstanding US Letter of Credit
Obligations), plus (ii) the amount of all Reserves then established in respect
of US Letter of Credit Obligations, plus (iii) the aggregate amount in excess of
$315,000 of all then outstanding and unpaid trade payables and other obligations
of US Borrowers which are outstanding more than sixty (60) days past due as of
the end of the immediately preceding month or at Agent’s option, as of a more
recent date based on such reports as Agent may from time to time specify (other
than trade payables or other obligations being contested or disputed by US
Borrowers in good faith), plus (iv) without duplication, the amount of checks
issued by US Borrowers to pay trade payables and other obligations which are
more than sixty (60) days past due as of the end of the immediately preceding
month or at Agent’s option, as of a more recent date based on such reports as
Agent may from time to time specify (other than trade payables or other
obligations being contested or disputed by US Borrowers in good faith), but not
yet sent.
     1.198 “US Fixed Asset Availability” shall mean the lesser of (a) the sum of
the US Equipment Availability and the US Real Property Availability and
(b) fifteen (15%) percent of the US Loan Limit.
     1.199 “US Guarantors” shall mean, collectively, the following (together
with their respective successors and assigns): (a) Associated Materials
Holdings, LLC, a Delaware limited liability company; (b) Gentek Holdings, LLC, a
Delaware limited liability company; (c) Alside, Inc., a Delaware corporation;
and (d) any other Person that at any time after the date hereof becomes party to
a guarantee in favor of Agent or any Lender or otherwise liable on or with
respect to the US Obligations or who is the owner of any property which is
security for the US Obligations (other than Borrowers); each sometimes being
referred to herein individually as a “US Guarantor”.

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     1.200 “US Inventory Loan Limit” shall mean US$75,000,000, not to exceed,
when taken together with the Canadian Inventory Loan Limit, the US Dollar
Equivalent of $100,000,000.
     1.201 “US Issuing Bank” shall mean Wachovia Bank, National Association or
any US Lender that is approved by Agent that shall issue a Letter of Credit for
the account of a US Borrower and has agreed in a manner satisfactory to Agent to
be subject to the terms hereof as a US Issuing Bank including, with respect to
Existing Letters of Credit, UBS AG, Stamford Branch.
     1.202 “US Lender” shall mean, at any time, each Lender having a US
Commitment or a Loan (or US Letter of Credit Obligation) made to any US Borrower
owing to it at such time; sometimes being referred to herein collectively as “US
Lenders”.
     1.203 “US Letter of Credit Limit” shall mean US$22,000,000.
     1.204 “US Letter of Credit Obligations” shall mean, at any time, the sum of
(a) the aggregate undrawn amount of all Letters of Credit issued for the account
of a US Borrower outstanding at such time, plus (b) the aggregate amount of all
drawings under Letters of Credit for a US Borrower for which Issuing Bank has
not at such time been reimbursed, plus (c) without duplication, the aggregate
amount of all payments made by each Lender to the US Issuing Bank with respect
to such Lender’s participation in Letters of Credit issued for the account of a
US Borrower as provided in Section 2.3 for which US Borrowers have not at such
time reimbursed the Lenders, whether by way of a Revolving Loan or otherwise.
     1.205 “US Loan Limit” shall mean US$165,000,000, as such amount may be
increased or decreased pursuant to and in accordance with the terms of
Section 2.6 hereof.
     1.206 “US Loan Parties” shall mean Guarantors and Borrowers other than the
Canadian Loan Parties; each sometimes being referred to individually as a “US
Loan Party.”
     1.207 “US Obligations” shall mean (a) any and all Loans, Letter of Credit
Obligations and all other obligations, liabilities and indebtedness of every
kind, nature and description owing by any or all of US Borrowers to Agent or any
Lender or any Issuing Bank, including principal, interest, charges, fees, costs
and expenses, however evidenced, whether as principal, surety, endorser,
guarantor or otherwise, arising under this Agreement or any of the other Loan
Documents or on account of any Letter of Credit and all other Letter of Credit
Obligations, whether now existing or hereafter arising, whether arising before,
during or after the initial or any renewal term of this Agreement or after the
commencement of any case with respect to such US Borrower under the United
States Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada), the
Companies’ Creditors Arrangement Act (Canada) or any similar statute (including
the payment of interest and other amounts which would accrue and become due but
for the commencement of such case, whether or not such amounts are allowed or
allowable in whole or in part in such case), whether direct or indirect,
absolute or contingent, joint or several, due or not due, primary or secondary,
liquidated or unliquidated, or secured or unsecured and (b) for purposes only of
Section 5.1 hereof and subject to the priority in right of payment set forth in
Section 6.7 hereof, all obligations, liabilities and indebtedness of every kind,
nature and description owing by any or all of US Borrowers or Guarantors to
Agent or any Bank Product Provider arising under or pursuant to any Bank
Products, whether now existing or hereafter arising; provided, that, (i) as to
any such obligations, liabilities and indebtedness arising under or pursuant to
a Hedge Agreement, the same shall only be included within the US Obligations if
upon Agent’s request, Agent shall have entered into an agreement, in form and

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substance satisfactory to Agent, with the Bank Product Provider that is a
counterparty to such Hedge Agreement, as acknowledged and agreed to by Borrowers
and Guarantors, providing for the delivery to Agent by such counterparty of
information with respect to the amount of such obligations and providing for the
other rights of Agent and such Bank Product Provider in connection with such
arrangements, (ii) any Bank Product Provider, other than Wachovia and its
Affiliates, shall have delivered written notice to Agent that (A) such Bank
Product Provider has entered into a transaction to provide Bank Products to a
Borrower and Guarantor and (B) the obligations arising pursuant to such Bank
Products provided to US Borrowers and Guarantors constitute Obligations entitled
to the benefits of the security interest of Agent granted hereunder, and Agent
shall have accepted such notice in writing and (iii) in no event shall any Bank
Product Provider acting in such capacity to whom such obligations, liabilities
or indebtedness are owing be deemed a Lender for purposes hereof to the extent
of and as to such obligations, liabilities or indebtedness except that each
reference to the term “Lender” in Sections 14.1, 14.2, 14.3(b), 14.6, 14.7,
14.9, 14.12 and 15.6 hereof shall be deemed to include such Bank Product
Provider and in no event shall the approval of any such person in its capacity
as Bank Product Provider be required in connection with the release or
termination of any security interest or lien of Agent.
     1.208 “US Payment Account” shall mean account no. 01459670001944 of Agent
at Wachovia Bank, National Association, or such other account of Agent as Agent
may from time to time designate to Administrative Borrower as the US Payment
Account for purposes of this Agreement and the other Loan Documents.
     1.209 “US Real Property Availability” shall mean seventy (70%) percent of
the appraised fair market value of the Eligible Real Property of US Borrowers
based (a) on the date hereof, upon the appraisal thereof in form and containing
assumptions and appraisal methods satisfactory to Agent, by an appraiser
acceptable to Agent and on which Agent is specifically permitted to rely,
delivered to Agent on or before the date hereof and (b) after the date hereof,
each subsequent appraisal of the Eligible Real Property of US Borrowers
delivered to Agent pursuant to Section 7.4 hereof; reduced as of November 1,
2008 and the first (1st) day of each month thereafter during the term hereof, by
an amount equal to one-sixtieth (1/60th) of the US Real Property Availability on
the date hereof.
     1.210 “US Reference Bank” shall mean Wachovia Bank, National Association,
or such other bank as Agent may from time to time designate.
     1.211 “Value” shall mean, as determined by Agent in good faith, with
respect to Inventory, the lower of (a) cost computed on a first-in first-out
basis in accordance with GAAP or (b) market value; provided, that, for purposes
of the calculation of the Canadian Borrowing Base and the US Borrowing Base,
(i) the Value of the Inventory shall not include: (A) the portion of the value
of Inventory equal to the profit earned by any Affiliate on the sale thereof to
any Borrower or (B) write-ups or write-downs in value with respect to currency
exchange rates and (ii) notwithstanding anything to the contrary contained
herein, the cost of the Inventory shall be computed in the same manner and
consistent with the most recent appraisal of the Inventory received and accepted
by Agent prior to the date hereof, if any, and (iii) Value shall be adjusted by
Agent in each case to take account of capitalized costs associated with finished
goods adjustments and variances recorded on the books and records of Borrowers
in accordance with GAAP.
     1.212 “Wachovia” shall mean Wachovia Bank, National Association, in its
individual capacity, and its successors and assigns.
     1.213 “Wachovia Canada” shall mean Wachovia Capital Finance Corporation
(Canada), an Ontario corporation, in its individual capacity, and its successors
and assigns.

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     1.214 “Weighted Average Life to Maturity” shall mean, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the then
outstanding principal amount of such Indebtedness into (b) the total of the
product obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment.
SECTION 2. CREDIT FACILITIES
     2.1 Revolving Loans.
          (a) Subject to and upon the terms and conditions contained herein,
(i) each US Lender severally (and not jointly) agrees to make its Pro Rata Share
of Revolving Loans in US Dollars (which Revolving Loans shall be repayable in US
Dollars) to US Borrowers from time to time in amounts requested by a US Borrower
(or Administrative Borrower on behalf of such US Borrower) up to the aggregate
amount outstanding for all US Lenders at any time equal to the lesser of:
(A) the US Borrowing Base at such time or (B) the amount equal to the US Loan
Limit at such time minus the US Dollar Equivalent of the aggregate amount of
Revolving Loans and Letter of Credit Obligations outstanding in favor of the
other US Borrowers at such time, (ii) each Canadian Lender severally (and not
jointly) agrees to make its Pro Rata Share of Revolving Loans in Canadian
Dollars or US Dollars to Canadian Borrowers (which Revolving Loans shall be
repayable in the currency in which such Revolving Loan was made) from time to
time in amounts requested by a Canadian Borrower (or Administrative Borrower on
behalf of any Canadian Borrower) up to the aggregate amount thereof outstanding
for all Canadian Lenders at any time equal to the lesser of: (A) the US Dollar
Equivalent of the Canadian Borrowing Base at such time or (B) an amount equal to
the Canadian Loan Limit at such time minus the aggregate amount of Revolving
Loans and Letter of Credit Obligations outstanding in favor of the other
Canadian Borrowers at such time. All Loans made by US Lenders to US Borrowers
shall be US Dollar Loans and all Loans made by Canadian Lenders to Canadian
Borrowers shall be Canadian Dollar Loans or US Dollar Loans.
          (b) Except with the consent of Agent and all Lenders, or as otherwise
provided herein, (i) the US Dollar Equivalent of the aggregate principal amount
of the Loans and the Letter of Credit Obligations outstanding at any time shall
not exceed the Maximum Credit, (ii) the US Dollar Equivalent of the aggregate
principal amount of the Revolving Loans and Letters of Credit Obligations of US
Borrowers outstanding at any time shall not exceed the lesser of (A) the US
Borrowing Base or (B) the US Loan Limit minus the US Dollar Equivalent of
Revolving Loans and Letter of Credit Obligations outstanding in favor of the
other US Borrowers at such time, and (iii) the US Dollar Equivalent of the
aggregate principal amount of the Revolving Loans and Letter of Credit
Obligations of Canadian Borrowers outstanding at any time shall not exceed the
lesser of (A) the Canadian Borrowing Base or (B) the Canadian Loan Limit minus
the US Dollar Equivalent of Revolving Loans and Letters of Credit Obligations
outstanding in favor of the other Canadian Borrowers at such time. Subject to
the terms and conditions hereof, each Borrower (or Administrative Borrower on
behalf of Borrowers) may from time to time borrow, prepay and reborrow Revolving
Loans. No Lender shall be required to make any Revolving Loan, if, after giving
effect thereto the aggregate outstanding principal amount of all Revolving Loans
of such Lender, together with such Lender’s Pro Rata Share of the aggregate
amount of all Swing Line Loans and Letter of Credit Obligations, would exceed
such Lender’s Commitment.
     2.2 Swing Line Loans.
          (a) Subject to the terms and conditions contained herein, the Swing
Line Lender agrees that it will make Swing Line Loans to Borrowers from time to
time in amounts requested by any Borrower (or Administrative Borrower on behalf
of Borrowers) up to the aggregate amount outstanding

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equal to the Swing Line Loan Limit; provided, that, after giving effect to any
such Swing Line Loan, (i) the aggregate principal amount of the Revolving Loans,
Swing Line Loans and Letter of Credit Obligations outstanding shall not exceed
the amount equal to the sum of the Canadian Borrowing Base and the US Borrowing
Base at such time, (ii) the aggregate principal amount of the Revolving Loans,
Swing Line Loans and Letter of Credit Obligations outstanding with respect to
all Borrowers shall not exceed the Maximum Credit at such time, (iii) if such
Borrower is a US Borrower, the aggregate principal amount of the Revolving
Loans, Swing Line Loans and Letter of Credit Obligations outstanding of US
Borrowers shall not exceed the US Borrowing Base or the US Loan Limit at such
time and (iv) if such Borrower is a Canadian Borrower, the aggregate principal
amount of the Revolving Loans, Swing Line Loans and Letter of Credit Obligations
outstanding of Canadian Borrowers shall not exceed the Canadian Borrowing Base
or the Canadian Loan Limit at such time. On the terms and subject to the
conditions hereof, each Borrower (or Administrative Borrower on behalf of
Borrowers) may from time to time borrow, prepay and reborrow Swing Line Loans.
Swing Line Lender shall not be required to make Swing Line Loans, if, after
giving effect thereto, the aggregate outstanding principal amount of all Swing
Line Loans would exceed the then existing Swing Line Loan Limit. Swing Line
Lender shall not be required to make a Swing Line Loan to refinance an
outstanding Swing Line Loan. Each Swing Line Loan shall be subject to all of the
terms and conditions applicable to other Base Rate Loans funded by the Lenders
constituting Revolving Loans, except that all payments thereon shall be payable
to the Swing Line Lender solely for its own account. All Revolving Loans and
Swing Line Loans shall be subject to the settlement among Lenders provided for
in Section 6.13 hereof.
          (b) Upon the making of a Swing Line Loan, without further action by
any party hereto, each Lender shall be deemed to have irrevocably and
unconditionally purchased and received from the Swing Line Lender, without
recourse or warranty, an undivided interest and participation to the extent of
such Lender’s Pro Rata Share in such Swing Line Loan. To the extent that there
is no settlement in accordance with Section 6.13 below, the Swing Line Lender
may at any time, require the Lenders to fund their participations. From and
after the date, if any, on which any Lender has funded its participation in any
Swing Line Loan, Agent shall promptly distribute to such Lender, not less than
weekly, such Lender’s Pro Rata Share of all payments of principal and interest
received by Agent in respect of such Swing Line Loan.
     2.3 Letters of Credit.
          (a) General. Subject to and upon the terms and conditions contained
herein and in the Letter of Credit Documents, (i) at the request of a US
Borrower (or Administrative Borrower on behalf of such US Borrower), Agent
agrees to cause US Issuing Bank to issue, and US Issuing Bank agrees to issue,
for the account of such US Borrower one or more Letters of Credit, for the
ratable risk of each US Lender according to its Pro Rata Share, containing terms
and conditions acceptable to Agent and Issuing Bank and (ii) at the request of a
Canadian Borrower (or Administrative Borrower on behalf of such Canadian
Borrower), Wachovia Canada agrees to cause Canadian Issuing Bank to issue for
the account of such Canadian Borrower one or more Letters of Credit denominated
in US Dollars or Canadian Dollars, for the ratable risk of each Canadian Lender
according to its Pro Rata Share, containing terms and conditions acceptable to
Agent and Canadian Issuing Bank.
          (b) Notice of Issuance, Amendment, Renewal, Extension. The Borrower
requesting such Letter of Credit (or Administrative Borrower on behalf of such
Borrower) shall give Agent and the Issuing Bank with respect thereto three
(3) Business Days’ prior written notice of such Borrower’s request for the
issuance of a Letter of Credit (or the amendment, renewal or extension of an
outstanding Letter of Credit). Such notice shall be irrevocable and shall
(i) specify the original face amount of the Letter of Credit requested (or
identify the Letter of Credit to be amended, renewed or extended), (ii) the
effective date (which date shall be a Business Day and in no event shall be a
date less than ten (10) days

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prior to the end of the then current term of this Agreement) of issuance of such
requested Letter of Credit (or such amendment, renewal or extension),
(iii) whether such Letter of Credit may be drawn in a single or in partial
draws, (iv) the date on which such requested Letter of Credit is to expire,
(v) the purpose for which such Letter of Credit is to be issued, (vi) the name
and address of the beneficiary of the requested Letter of Credit, (vii) such
other information as shall be necessary to enable the Issuing Bank to prepare,
amend, renew or extend such Letter of Credit and (viii) if requested by Issuing
Bank or Agent, the Borrower requesting such Letter of Credit (or Administrative
Borrower on behalf of such Borrower) shall have delivered to Issuing Bank with
respect thereto at such times and in such manner as such Issuing Bank may
require, an application, in form and substance satisfactory to such Issuing Bank
and Agent, for the issuance of the Letter of Credit and such other Letter of
Credit Documents as may be required pursuant to the terms thereof. If requested
by the Issuing Bank, the Borrower requesting the Letter of Credit (or
Administrative Borrower on behalf of such Borrower) shall attach to the request
the proposed terms of the Letter of Credit. In no event shall a Letter of Credit
be issued, amended, renewed or extended unless the forms and terms of the
proposed Letter of Credit (as amended, renewed or extended, as the case may be)
is satisfactory to Agent and Issuing Bank. The renewal or extension of, or
increase in the amount of, any Letter of Credit shall, for purposes hereof, be
treated in all respects the same as the issuance of a new Letter of Credit
hereunder.
          (c) Certain Conditions to US Letters of Credit. In addition to being
subject to the satisfaction of the applicable conditions precedent contained in
Section 4 hereof and the other terms and conditions contained herein, no Letter
of Credit shall be available to US Borrowers unless each of the following
conditions precedent have been satisfied in a manner satisfactory to Agent:
(i) the US Borrower requesting such Letter of Credit (or Administrative Borrower
on behalf of such US Borrower) shall have delivered to the US Issuing Bank at
such times and in such manner as US Issuing Bank may require, an application, in
form and substance satisfactory to US Issuing Bank and Agent, for the issuance
of the Letter of Credit and such other Letter of Credit Documents as may be
required pursuant to the terms thereof, and the form and terms of the proposed
Letter of Credit shall be satisfactory to Agent and US Issuing Bank, (ii) as of
the date of issuance, no order of any court, arbitrator or other Governmental
Authority shall purport by its terms to enjoin or restrain money center banks
generally from issuing letters of credit of the type and in the amount of the
proposed Letter of Credit, and no law, rule or regulation applicable to money
center banks generally and no request or directive (whether or not having the
force of law) from any Governmental Authority with jurisdiction over money
center banks generally shall prohibit, or request that US Issuing Bank (or other
issuer) refrain from, the issuance of letters of credit generally or the
issuance of such Letter of Credit, (iii) after giving effect to the issuance of
such Letter of Credit, the US Letter of Credit Obligations shall not exceed the
US Letter of Credit Limit, and (iv) in the case of a Letter of Credit issued for
the account of a US Borrower, the US Excess Availability prior to giving effect
to any Reserves with respect to such Letter of Credit, on the date of the
proposed issuance of any Letter of Credit shall be equal to or greater than: (A)
if the proposed Letter of Credit is for the purpose of purchasing Eligible
Inventory consisting of finished goods and the documents of title with respect
thereto are consigned to US Issuing Bank, the sum of (1) the percentage equal to
one hundred (100%) percent minus the then applicable percentage with respect to
Eligible Inventory set forth in the definition of the term Borrowing Base
multiplied by the Value of such Eligible Inventory, plus (2) unpaid freight,
taxes, duty and other amounts which Agent estimates must be paid in connection
with such Inventory upon arrival and for delivery to one of Borrowers’ locations
for Eligible Inventory within the United States of America or Canada and (B) if
the proposed Letter of Credit is for any other purpose or the documents of title
are not consigned to US Issuing Bank in connection with a Letter of Credit for
the purpose of purchasing Inventory, an amount equal to one hundred (100%)
percent of the Letter of Credit Obligations with respect thereto. Effective on
the issuance of each Letter of Credit, a Reserve shall be established in the
applicable amount set forth in Section 2.3(c)(iv)(A) or Section 2.3(c)(iv)(B).

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          (d) Certain Conditions to Canadian Letters of Credit. In addition to
being subject to the satisfaction of the applicable conditions precedent
contained in Section 4 hereof and the other terms and conditions contained
herein, no Letter of Credit shall be available to Canadian Borrowers unless each
of the following conditions precedent have been satisfied in a manner
satisfactory to Agent: (i) the Canadian Borrower (or Administrative Borrower on
behalf of Canadian Borrower) shall have delivered to Canadian Issuing Bank at
such times and in such manner as Canadian Issuing Bank may require, an
application, in form and substance satisfactory to Canadian Issuing Bank and
Agent, for the issuance of the Letter of Credit and such other Letter of Credit
Documents as may be reasonably required pursuant to the terms thereof, and the
form and terms of the proposed Letter of Credit shall be satisfactory to Agent
and Canadian Issuing Bank, (ii) as of the date of issuance, no order of any
court, arbitrator or other Governmental Authority shall purport by its terms to
enjoin or restrain money center banks generally from issuing letters of credit
of the type and in the amount of the proposed Letter of Credit, and no law, rule
or regulation applicable to money center banks generally and no request or
directive (whether or not having the force of law) from any Governmental
Authority with jurisdiction over money center banks generally shall prohibit, or
request that Canadian Issuing Bank refrain from, the issuance of letters of
credit generally or the issuance of such Letter of Credit, (iii) after giving
effect to the issuance of such Letter of Credit, the Canadian Letter of Credit
Obligations shall not exceed the Canadian Letter of Credit Limit, and (iv) in
the case of a Letter of Credit issued for the account of a Canadian Borrower,
the Canadian Excess Availability prior to giving effect to any Reserves with
respect to such Letter of Credit, on the date of the proposed issuance of any
Letter of Credit shall be equal to or greater than: (A) if the proposed Letter
of Credit is for the purpose of purchasing Eligible Inventory consisting of
finished goods and the documents of title with respect thereto are consigned to
Canadian Issuing Bank, the sum of (1) the percentage equal to one hundred (100%)
percent minus the then applicable percentage with respect to Eligible Inventory
set forth in the definition of the term Borrowing Base multiplied by the Value
of such Eligible Inventory, plus (2) unpaid freight, taxes, duty and other
amounts which Agent reasonably estimates must be paid in connection with such
Inventory upon arrival and for delivery to one of the Canadian Borrower’s
locations for Eligible Inventory within Canada or the United States and (B) if
the proposed Letter of Credit is for any other purpose or the documents of title
are not consigned to Canadian Issuing Bank in connection with a Letter of Credit
for the purpose of purchasing Inventory, an amount equal to one hundred (100%)
percent of the Letter of Credit Obligations with respect thereto. Effective on
the issuance of each Letter of Credit, a Reserve shall be established in the
applicable amount set forth in Section 2.3(d)(iv)(A) or Section 2.3(d)(iv)(B).
          (e) Letter of Credit Sublimits. Except in Agent’s discretion and with
the consent of all Lenders, (i) the amount of all outstanding US Letter of
Credit Obligations shall not at any time exceed the US Letter of Credit Limit
and (ii) the amount of all outstanding Canadian Letter of Credit Obligations
shall not at any time exceed the Canadian Letter of Credit Limit.
          (f) Expiration. Each standby Letter of Credit shall expire at or prior
to the earlier of (i) twelve (12) months after the date of the issuance of such
standby Letter of Credit (or in the case of any renewal or extension thereof,
twelve (12) months after such renewal or extension) and (ii) the date that is
five (5) Business Days prior to the Maturity Date; provided, that, (A) any
standby Letter of Credit with a one year tenor may provide for automatic renewal
or extension thereof for additional one year periods (which in no event shall
extend beyond the date referred to in clause (ii) above) so long as such standby
Letter of Credit permits the Issuing Bank to prevent any such extension at least
once in each twelve-month period (commencing with the date of issuance of such
standby Letter of Credit) by giving prior notice to the beneficiary thereof
within a time period during such twelve-month period to be agreed upon at the
time such standby Letter of Credit is issued and (B) if the Issuing Bank and
Agent each consent, the expiration date on any standby Letter of Credit may
extend beyond the date referred to in clause (ii) above. Each trade or
commercial Letter of Credit shall expire on the earlier of one hundred eighty
(180) days after such trade Letter of Credit’s date of issuance, renewal or
extension (as applicable) or the date five (5) Business Days prior to the
Maturity Date.

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          (g) US Letter of Credit Participations. Immediately upon the issuance
or amendment of any Letter of Credit issued for the account of a US Borrower,
each US Lender shall be deemed to have irrevocably and unconditionally purchased
and received, without recourse or warranty, an undivided interest and
participation to the extent of such US Lender’s Pro Rata Share of the liability
with respect to such Letter of Credit and the obligations of US Borrowers with
respect thereto (including all Letter of Credit Obligations with respect
thereto). Each US Lender shall absolutely, unconditionally and irrevocably
assume, as primary obligor and not as surety, and be obligated to pay to US
Issuing Bank therefor and discharge when due, its Pro Rata Share of all of such
obligations arising under such Letter of Credit. Without limiting the scope and
nature of each US Lender’s participation in any such Letter of Credit, to the
extent that US Issuing Bank has not been reimbursed or otherwise paid as
reasonably required hereunder with respect to any such Letter of Credit or under
any such Letter of Credit, each such US Lender shall pay to US Issuing Bank its
Pro Rata Share of such unreimbursed drawing or other amounts then due to US
Issuing Bank in connection therewith.
          (h) Canadian Letter of Credit Participations. Immediately upon the
issuance or amendment of any Letter of Credit issued for the account of a
Canadian Borrower, each Canadian Lender shall be deemed to have irrevocably and
unconditionally purchased and received, without recourse or warranty, an
undivided interest and participation to the extent of such Canadian Lender’s Pro
Rata Share of the liability with respect to such Letter of Credit and the
obligations of such Canadian Borrower with respect thereto (including all Letter
of Credit Obligations with respect thereto). Each Canadian Lender shall
absolutely, unconditionally and irrevocably assume, as primary obligor and not
as surety, and be obligated to pay to Canadian Issuing Bank therefor and
discharge when due, its Pro Rata Share of all of such obligations arising under
such Letter of Credit. Without limiting the scope and nature of each Canadian
Lender’s participation in any such Letter of Credit, to the extent that Canadian
Issuing Bank or other issuer has not been reimbursed or otherwise paid as
required hereunder or under any such Letter of Credit, each Canadian Lender
shall pay to Canadian Issuing Bank its Pro Rata Share of such unreimbursed
drawing or other amounts then due to Canadian Issuing Bank in connection
therewith.
          (i) US Letter of Credit Reimbursement. If a US Issuing Bank shall make
any payment in respect of a Letter of Credit, US Borrowers shall reimburse US
Issuing Bank by paying to Agent an amount equal to such payment by US Issuing
Bank not later than 12:00 noon on the date that such payment by US Issuing Bank
is made, if the applicable US Borrower (or Administrative Borrower on behalf of
such Borrower) shall have received notice of such payment by the Issuing Bank
prior to 10:00 a.m. on such date, or, if such notice shall not have been
received by such US Borrower (or Administrative Borrower) prior to such time on
such date, then not later than 12:00 noon on (i) the Business Day that such US
Borrower (or Administrative Borrower) receives such notice, if such notice is
received prior to 10:00 a.m., on the day of receipt, or (ii) the Business Day
immediately following the day that such US Borrower (or Administrative Borrower)
receives such notice, if such notice is not received prior to such time on the
day of receipt; provided, that, unless such US Borrower (or Administrative
Borrower) requests otherwise, and, subject to the conditions to borrowing set
forth herein, each drawing under any Letter of Credit or other amount payable in
connection therewith when due shall constitute a request by the Borrower for
whose account such Letter of Credit was issued to Agent for a Base Rate Loan in
the amount of such drawing or other amount then due, and shall be made by Agent
on behalf of Lenders as a Revolving Loan or Swing Line Loan as Administrative
Borrower requests, or if such request is not received in a timely manner, as
Agent determines (or Special Agent Advance, as the case may be) in an equivalent
amount and, to the extent so financed, such US Borrower’s obligation to make
such payment shall be discharged and replaced by the resulting Revolving Loan,
Swing Line Loan (or Special Agent Advance, as the case may be). If the
applicable US Borrower fails to make such payment when due,

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subject to the rights of Agent under Section 6.13 hereof, Agent may notify each
Lender of the applicable payment made by the Issuing Bank in respect of such
Letter of Credit, the payment then due from such US Borrower in respect thereof
and such Lender’s Pro Rata Share thereof. Promptly following receipt of such
notice, each Lender shall pay to Agent its Pro Rata Share of the payment then
due and Agent shall promptly pay to the applicable Issuing Bank the amounts so
received by it from Lenders. Promptly following receipt by Agent of any payment
from a US Borrower pursuant to this paragraph, Agent shall distribute such
payment to the applicable Issuing Bank or, to the extent that Lenders have made
payments pursuant to this paragraph to reimburse such Issuing Bank, then to such
Lenders and such Issuing Bank as their interests may appear. Any payment made by
a Revolving Lender pursuant to this paragraph to reimburse an Issuing Bank for
any payment made by such Issuing Bank (other than the funding of a Revolving
Loan, Swing Line Loan or Special Agent Advance as contemplated above) shall not
constitute a Loan and shall not relieve the applicable US Borrower of its
obligation to reimburse such Issuing Bank for such payment.
          (j) Canadian Letter of Credit Reimbursement. If a Canadian Issuing
Bank shall make any payment in respect of a Letter of Credit, Canadian Borrowers
shall reimburse Canadian Issuing Bank by paying to Agent an amount equal to such
payment by Canadian Issuing Bank not later than 12:00 noon on the date that such
payment by Canadian Issuing Bank is made, if the applicable Canadian Borrower
(or Administrative Borrower on behalf of such Canadian Borrower) shall have
received notice of such payment by such Issuing Bank prior to 10:00 a.m. on such
date, or, if such notice shall not have been received by such Canadian Borrower
(or Administrative Borrower) prior to such time on such date, then not later
than 12:00 noon on (i) the Business Day that such Canadian Borrower (or
Administrative Borrower) receives such notice, if such notice is received prior
to 10:00 a.m., on the day of receipt, or (ii) the Business Day immediately
following the day that such Canadian Borrower (or Administrative Borrower)
receives such notice, if such notice is not received prior to such time on the
day of receipt; provided, that, unless such Borrower (or Administrative
Borrower) requests otherwise, and, subject to the conditions to borrowing set
forth herein, each drawing under any Letter of Credit or other amount payable in
connection therewith when due shall constitute a request by the Canadian
Borrower for whose account such Letter of Credit was issued to Agent for a Base
Rate Loan in the amount of such drawing or other amount then due, and shall be
made by Agent on behalf of Lenders as a Revolving Loan or Swing Line Loan as
Administrative Borrower requests, or if such request is not received in a timely
manner, as Agent determines (or Special Agent Advance, as the case may be) in an
equivalent amount and, to the extent so financed, such Canadian Borrower’s
obligation to make such payment shall be discharged and replaced by the
resulting Revolving Loan, Swing Line Loan (or Special Agent Advance, as the case
may be). If the applicable Canadian Borrower fails to make such payment when
due, subject to the rights of Agent under Section 6.13 hereof, Agent may notify
each Lender of the applicable payment made by the Issuing Bank in respect of
such Letter of Credit, the payment then due from such Canadian Borrower in
respect thereof and such Lender’s Pro Rata Share thereof. Promptly following
receipt of such notice, each Lender shall pay to Agent its Pro Rata Share of the
payment then due and Agent shall promptly pay to the applicable Issuing Bank the
amounts so received by it from Lenders. Promptly following receipt by Agent of
any payment from a Borrower pursuant to this paragraph, Agent shall distribute
such payment to the applicable Issuing Bank or, to the extent that Lenders have
made payments pursuant to this paragraph to reimburse such Issuing Bank, then to
such Lenders and such Issuing Bank as their interests may appear. Any payment
made by a Revolving Lender pursuant to this paragraph to reimburse an Issuing
Bank for any payment made by such Issuing Bank (other than the funding of a
Revolving Loan, Swing Line Loan or Special Agent Advance as contemplated above)
shall not constitute a Loan and shall not relieve the applicable Canadian
Borrower of its obligation to reimburse such Issuing Bank for such payment.

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          (k) Obligations Absolute. The obligations of US Borrowers to pay each
Letter of Credit Obligation, the obligations of Canadian Borrowers to pay each
Canadian Letter of Credit Obligation, the obligations of Canadian Lenders to
make payments to Agent for the account of Canadian Issuing Bank with respect to
Letters of Credit issued for the account of a Canadian Borrower and the
obligations of US Lenders to make payments to Agent for the account of US
Issuing Bank with respect to Letters of Credit issued for the account of a US
Borrower shall be absolute, unconditional and irrevocable and shall be performed
strictly in accordance with the terms of this Agreement under any and all
circumstances, whatsoever, notwithstanding the occurrence or continuance of any
Default, Event of Default, the failure to satisfy any other condition set forth
in Section 4 hereof or any other event or circumstance, and irrespective of
(i) any lack of validity or enforceability of any Letter of Credit or this
Agreement, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment by an Issuing Bank under a Letter of Credit against
presentation of a draft or other document that does not comply with the terms of
such Letter of Credit, except where such payment constitutes gross negligence or
willful misconduct on the part of the Issuing Bank, as determined pursuant to a
final, non-appealable order of a court of competent jurisdiction, or (iv) any
other event or circumstance whatsoever, whether or not similar to any of the
foregoing, that might, but for the provisions of this Section, constitute a
legal or equitable discharge of, or provide a right of setoff against, a
Borrower’s obligations hereunder, except where such circumstance constitutes
gross negligence or willful misconduct on the part of the Issuing Bank, as
determined pursuant to a final, non-appealable order of a court of competent
jurisdiction. None of Agent, Lenders or the Issuing Banks, or any of their
Affiliates, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of an
Issuing Bank; provided, that, the foregoing shall not be construed to excuse an
Issuing Bank from liability to the applicable Borrower to the extent of any
direct damages (as opposed to consequential damages, claims in respect of which
are hereby waived by each Borrower to the extent permitted by applicable law)
suffered by a Borrower that are caused by an Issuing Bank’s failure to exercise
care when determining whether drafts and other documents presented under a
Letter of Credit comply with the terms thereof. The parties hereto expressly
agree that, in the absence of gross negligence or willful misconduct on the part
of an Issuing Bank (as determined pursuant to a final, non-appealable order of a
court of competent jurisdiction), such Issuing Bank shall be deemed to have
exercised care in each such determination. In furtherance of the foregoing and
without limiting the generality thereof, with respect to documents presented
which appear on their face to be in substantial compliance with the terms of a
Letter of Credit, an Issuing Bank may, in its discretion, either accept and make
payment upon such documents without responsibility for further investigation,
regardless of any notice or information to the contrary, or refuse to accept and
make payment upon such documents if such documents are not in strict compliance
with the terms of such Letter of Credit.
          (l) Disbursement Procedures. The applicable Issuing Bank shall,
promptly following its receipt thereof, examine all documents purporting to
represent a demand for payment under a Letter of Credit. Such Issuing Bank shall
promptly notify Agent and the applicable Borrower (or Administrative Borrower)
by telephone (confirmed by facsimile or otherwise as Administrative Borrower and
Issuing Bank may agree) of such demand for payment and whether such Issuing Bank
has made or will make any payment in respect thereof; provided, that, any
failure to give or delay in giving such notice shall not relieve the applicable
Borrower of its obligation to reimburse such Issuing Bank and Lenders with
respect to any such payment.

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          (m) Interim Interest. If an Issuing Bank shall make any payment in
respect of a Letter of Credit, or otherwise be owed any amounts in respect
thereof, then, unless the applicable Borrower shall reimburse Issuing Bank for
such payment or other amount in full on the date such payment is made or amount
due, the unpaid amount thereof shall bear interest, for each day from and
including the date such payment is made or amount due but excluding the date
that the applicable Borrower reimburses such payment or other amount, at the
rate per annum then applicable to Base Rate Loans. Interest accrued pursuant to
this paragraph shall be for the account of the applicable Issuing Bank; except,
that, interest accrued on and after the date of payment by Agent or any Lender
pursuant to Section 2.3(f) above to reimburse such Issuing Bank shall be for the
account of Agent or such Lender to the extent of such payment, and shall be
payable on demand or, if no demand has been made, on the date on which the
applicable Borrower reimburses the applicable payment in full.
          (n) Indemnification. Borrowers and Guarantors shall indemnify and hold
Agent and Lenders harmless from and against any and all losses, claims, damages,
liabilities, costs and expenses which Agent or any Lender may suffer or incur in
connection with any Letter of Credit and any documents, drafts or acceptances
relating thereto, including any losses, claims, damages, liabilities, costs and
expenses due to any action taken by an Issuing Bank or correspondent with
respect to any Letter of Credit, except for such losses, claims, damages,
liabilities, costs or expenses (i) that are a direct result of the gross
negligence or willful misconduct of Agent or any Lender as determined pursuant
to a final non-appealable order of a court of competent jurisdiction,
(ii) arising out of any proceeding that does not result from or arise out of an
act or omission of any Borrower or Guarantor and that is brought by an Agent, an
Issuing Bank or a Lender against an Agent, an Issuing Bank or a Lender, or
(iii) to the extent they have been found by a final, non-appealable judgment of
a court of competent jurisdiction to have resulted exclusively from the material
breach of a material term of any Loan Document by such indemnitee. Each Borrower
and Guarantor assumes all risks for, and agrees to pay, all foreign, Federal,
State and local taxes, duties and levies relating to any goods subject to any
Letter of Credit or any documents, drafts or acceptances thereunder. Each
Borrower and Guarantor hereby releases and holds Agent and Lenders harmless from
and against any acts, waivers, errors, delays or omissions with respect to or
relating to any Letter of Credit, except for the gross negligence or willful
misconduct of Agent or any Lender as determined pursuant to a final,
non-appealable order of a court of competent jurisdiction. The provisions of
this Section 2.3(n) shall survive the payment of Obligations and the termination
of this Agreement.
          (o) Account Party. Each Borrower and Guarantor hereby irrevocably
authorizes and directs each Issuing Bank to name such Borrower or Guarantor as
the account party therein and to deliver to Agent all instruments, documents and
other writings and property received by such Issuing Bank pursuant to the Letter
of Credit and to accept and rely upon Agent’s instructions and agreements with
respect to all matters arising in connection with the Letter of Credit or the
Letter of Credit Documents with respect thereto. Nothing contained herein shall
be deemed or construed to grant any Borrower or Guarantor any right or authority
to pledge the credit of Agent or any Lender in any manner. Agent and Lenders
shall have no liability of any kind with respect to any Letter of Credit
provided by Issuing Bank unless Agent has duly executed and delivered to Issuing
Bank the application or a guarantee or indemnification in writing with respect
to such Letter of Credit. Borrowers and Guarantors shall be bound by any
reasonable interpretation made in good faith by Agent, or an Issuing Bank under
or in connection with any Letter of Credit or any documents, drafts or
acceptances thereunder, notwithstanding that such interpretation may be
inconsistent with any instructions of any Borrower or Guarantor. In connection
with Inventory purchased pursuant to any Letter of Credit, Borrowers and
Guarantors shall, at Agent’s prior written request, instruct all suppliers,
carriers, forwarders, customs brokers, warehouses or others receiving or holding
cash, checks, Inventory, documents or instruments in which Agent holds a
security interest that upon Agent’s prior written request, such items are to be
delivered to Agent and/or subject to Agent’s order, and if they shall come into
such Borrower’s or Guarantor’s possession, to deliver them, upon Agent’s prior
written request, to Agent in their original form. Except as otherwise provided
herein, Agent shall not exercise such right to request such items so long as no
Default or Event of Default shall exist or have occurred and be continuing.
Except as Agent may otherwise specify, Borrowers and Guarantors shall designate
the Issuing Bank with respect to a Letter of Credit as the consignee on all
bills of lading and other negotiable and non-negotiable documents under such
Letter of Credit.

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          (p) Any rights, remedies, duties or obligations granted or undertaken
by any Borrower to Issuing Bank in any application for any Letter of Credit, or
any other agreement in favor of Issuing Bank relating to any Letter of Credit,
shall be deemed to have been granted or undertaken by such Borrower to Agent.
Any duties or obligations undertaken by Agent to Issuing Bank in any application
for any Letter of Credit, or any other agreement by Agent in favor of Issuing
Bank relating to any Letter of Credit, shall be deemed to have been undertaken
by Borrowers to Agent and to apply in all respects to Borrowers.
     2.4 Requests for Borrowings.
          (a) To request a Revolving Loan or Swing Line Loan, the applicable
Borrower (or Administrative Borrower on behalf of such Borrower) shall notify
Agent of such request by telephone (i) in the case of a Eurodollar Rate Loan,
not later than 11:00 a.m., three (3) Business Days before the date of the
proposed Eurodollar Rate Loan or (ii) in the case of a Base Rate Loan (including
a Swing Line Loan), not later than 1:00 p.m. on the same Business Day as the
date of the proposed Base Rate Loan. Each such telephonic request shall be
irrevocable and to the extent required by Agent, shall be confirmed promptly by
hand delivery or facsimile to Agent of a written request in a form approved by
Agent and signed by or on behalf of Borrowers. Each such telephonic and written
request shall specify the following information:
                    (A) the Borrower requesting such Revolving Loan or Swing
Line Loan;
                    (B) whether such Loan is a Revolving Loan or Swing Line
Loan;
                    (C) the aggregate amount of such Revolving Loan or Swing
Line Loan;
                    (D) the date of such Revolving Loan, which shall be a
Business Day;
               (E) if such Loan is to be a Revolving Loan, whether such
Revolving Loan is to be a Base Rate Loan or a Eurodollar Rate Loan;
               (F) in the case of a Eurodollar Rate Loan, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by the
definition of the term “Interest Period”; and
               (G) the deposit account of the applicable Borrower specified on
Schedule 8.10 of the Information Certificate or any other account into which the
requested Loan shall be deposited specified in an account designation letter
delivered by Administrative Borrower to Agent as hereafter amended from time to
time.
          (b) If no election as to whether a Revolving Loan is to be a Base Rate
Loan or Eurodollar Rate Loan is specified in the applicable request, then the
requested Revolving Loan shall be a Base Rate Loan. If no Interest Period is
specified with respect to any request for a Eurodollar Rate Loan, then the
applicable Borrower shall be deemed to have selected an Interest Period of one
month’s duration. Promptly following receipt of a request for a Revolving Loan
in accordance with this Section, Agent shall advise each Lender of the details
thereof and of the amount of such Lender’s Revolving Loan to be made as part of
the request.

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          (c) All Loans and Letters of Credit under this Agreement shall be
conclusively presumed to have been made to, and at the request of and for the
benefit of, any Borrower or Guarantor when deposited to the credit of any
Borrower or Guarantor or otherwise disbursed or established in accordance with
the instructions of any Borrower or Guarantor or in accordance with the terms
and conditions of this Agreement.
          (d) Except in Agent’s discretion and with the consent of all Lenders,
or as otherwise provided herein, the aggregate amount of the Revolving Loans,
the Swing Line Loans and the Letter of Credit Obligations outstanding at any
time shall not exceed the lesser of the Maximum Credit or the Borrowing Base.
     2.5 Prepayments.
          (a) Borrowers may prepay without penalty or premium the principal of
any Revolving Loan or Swing Line Loan, in whole or in part, subject to
Section 3.10 and Section 6.7 hereof.
          (b) In the event that (i) the aggregate amount of the Loans and the
Letter of Credit Obligations outstanding at any time exceed the Maximum Credit,
or (ii) except as otherwise provided herein, the aggregate principal amount of
the Revolving Loans, Swing Line Loans and Letter of Credit Obligations
outstanding exceed the Borrowing Base or (iii) the outstanding principal amount
of the Swing Line Loans outstanding exceed the Swing Line Loan Limit, such event
shall not limit, waive or otherwise affect any rights of Agent or Lenders in
such circumstances or on any future occasions and Borrowers shall immediately
repay to Agent the entire amount of any such excess(es) for which payment is
demanded.
     2.6 Increases and Decreases in Maximum Credit.
          (a) Administrative Borrower may, at any time, deliver a written
request to Agent to increase or decrease the Maximum Credit. Any such written
request shall specify the amount of the increase or decrease, as the case may
be, in the Maximum Credit that Borrowers are requesting; provided, that, (i) in
no event shall the aggregate amount of any such incremental increases in the
Maximum Credit (the “Incremental Facility”) cause the Maximum Credit to exceed
the US Dollar Equivalent of US$300,000,000, (ii) in no event shall the aggregate
amount of any decrease in the Maximum Credit cause the Maximum Credit to be less
than the US Dollar Equivalent of US$175,000,000, (iii) such request shall be for
an increase of not less than the US Dollar Equivalent of US$10,000,000 and for a
decrease of not less than the US Dollar Equivalent of US$10,000,000, as the case
may be, (iv) any such request shall be irrevocable, (v) in no event shall more
than one such written request to increase the Maximum Credit be delivered to
Agent in any calendar quarter or more than three (3) such written request be
delivered to Agent thereof, (vi) in no event shall more than two (2) such
written request to decrease the Maximum Credit be delivered to Agent during the
term hereof and (vii) from and after any decrease in the Maximum Credit pursuant
to this Section 2.6, Borrowers shall no longer have the right to request any
increase in the Maximum Credit pursuant to this Section 2.6 or otherwise.
          (b) Upon the receipt by Agent of any such written request to increase
the Maximum Credit, Agent shall notify each of the Lenders of such request and
each Lender shall have the option (but not the obligation) to increase the
amount of its Commitment by an amount up to its Pro Rata Share of the amount of
the increase in the Maximum Credit requested by Administrative Borrower as set
forth in the notice from Agent to such Lender. Each Lender shall notify Agent
within ten (10) Business Days after

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the receipt of such notice from Agent whether it is willing to so increase its
Commitment, and if so, the amount of such increase; provided, that, (i) the
minimum increase in the Commitments of each such Lender providing the additional
Commitments shall equal or exceed the US Dollar Equivalent of $2,000,000 and
(ii) no Lender shall be obligated to provide such increase in its Commitment and
the determination to increase the Commitment of a Lender shall be within the
sole and absolute discretion of such Lender. If the aggregate amount of the
increases in the Commitments received from the Lenders does not equal or exceed
the amount of the increase in the Maximum Credit requested by Administrative
Borrower, Agent may seek additional increases from Lenders or Commitments from
such Eligible Transferees as it may determine, after consultation with
Administrative Borrower. In the event Lenders (or Lenders and any such Eligible
Transferees, as the case may be) have committed in writing to provide increases
in their Commitments or new Commitments in an aggregate amount in excess of the
increase in the Maximum Credit requested by Borrowers or permitted hereunder,
Agent shall then have the right to allocate such commitments, first to Lenders
and then to Eligible Transferees, in such amounts and manner as Agent may
determine, after consultation with Administrative Borrower. If, in connection
with the arrangement of additional Commitments for the Incremental Facility the
resulting pricing with respect to any Loans or Letters of Credit under the
Incremental Facility would be greater than otherwise applicable to Loans or
Letters of Credit immediately prior to the Maximum Credit Increase Effective
Date, then on and after the Maximum Credit Increase Effective Date, each
Interest Rate under this Agreement shall be automatically increased such that in
no event shall any Interest Rate applicable to Loans and Letters of Credit in
respect of the Incremental Facility exceeds those applicable to other Loans and
Letters of Credit hereunder.
          (c) The Maximum Credit shall be increased by the amount of the
increase in Commitments from Lenders or new Commitments from Eligible
Transferees, in each case selected in accordance with this Section 2.6, for
which Agent has received Assignment and Acceptances sixty (60) days after the
date of the request by Administrative Borrower for the increase or such earlier
date as Agent and Administrative Borrower may agree (but subject to the
satisfaction of the conditions set forth below), whether or not the aggregate
amount of the increase in Commitments and new Commitments, as the case may be,
equal or exceed the amount of the increase in the Maximum Credit requested by
Administrative Borrower in accordance with the terms hereof, effective on the
date that Agent shall have notified Administrative Borrower that each of the
following conditions have been satisfied (such date being the “Maximum Credit
Increase Effective Date”):
               (i) Agent shall have obtained sufficient additional Commitments
as may be necessary to provide the Incremental Facility as contemplated by this
Section 2.6 and shall have received from each Lender or Eligible Transferee that
is providing an additional Commitment as part of the increase in the Maximum
Credit, an Assignment and Acceptance duly executed by such Lender or Eligible
Transferee and each Borrower; provided, that, the aggregate Commitments set
forth in such Assignment and Acceptance(s) shall be not less than the US Dollar
Equivalent of $5,000,000;
               (ii) the conditions precedent to the making of Revolving Loans
set forth in Section 4.2 shall be satisfied as of the Maximum Credit Increase
Effective Date, both before and after giving effect to such increase;
               (iii) Agent shall have received an opinion of counsel to
Borrowers in form and substance and from counsel reasonably satisfactory to
Agent and Lenders addressing such matters as Agent may reasonably request
(including an opinion as to no conflicts with the Opco Notes and other
Indebtedness);

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               (iv) such increase in the Maximum Credit shall not violate any
applicable law, regulation or order or decree of any court or other Governmental
Authority and shall not be enjoined, temporarily, preliminarily or permanently;
               (v) there shall have been paid to each Lender and Eligible
Transferee providing an additional Commitment in connection with such increase
in the Maximum Credit all fees and expenses due and payable to such Person on or
before the effectiveness of such increase; and
               (vi) there shall have been paid to Agent, for the account of the
Agent and Lenders (in accordance with any agreement among them) all fees and
expenses (including reasonable fees and expenses of counsel) due and payable
pursuant to any of the Loan Documents on or before the effectiveness of such
increase.
          (d) Upon the receipt by Agent of a written request to decrease the
Maximum Credit, Agent shall notify each of the Lenders of such request and,
subject to the terms of this Section 2.6, the Commitments of each Lender shall
be decreased on the date determined by Administrative Borrower and Agent by an
amount equal to such Lender’s Pro Rata Share of the amount of the decrease in
the Maximum Credit requested by Administrative Borrower as set forth in the
notice from Agent to such Lender (the “Maximum Increase Reduction Date”).
          (e) In the event of a request to decrease the Maximum Credit, the
Maximum Credit shall be decreased by the amount of the decrease in Commitments
requested by Administrative Borrower in accordance with the terms hereof,
subject to the satisfaction of each of the following conditions:
               (i) the Maximum Credit, after giving effect to such decrease,
shall not be less than the aggregate amount of the Loans and Letter of Credit
Obligations outstanding at such time; and
               (ii) the conditions precedent to the making of Revolving Loans
set forth in Section 4.2 shall be satisfied as of the Maximum Credit Decrease
Effective Date, both before and after giving effect to such decrease.
          (f) As of the Maximum Credit Increase Effective Date or Maximum
Increase Reduction Date, as the case may be, each reference to the term Maximum
Credit herein, and in any of the other Loan Documents shall be deemed amended to
mean the amount of the Maximum Credit specified in the most recent written
notice from Agent to Administrative Borrower of the increase or decrease in the
Maximum Credit, and the amount of the US Loan Limit and/or the Canadian Loan
Limit shall be adjusted by the same percentage as the adjustment in the US
Commitments and/or the Canadian Commitments, as applicable.
          (g) Notwithstanding anything to the contrary set forth in this
Agreement or any of the other Loan Documents, in the case of any reduction in
the Maximum Credit pursuant to this Section 2.6, all determinations of Global
Excess Availability, Canadian Excess Availability and US Excess Availability
shall continue to be made on the basis of the Maximum Credit as in effect on the
date hereof.
     2.7 Joint and Several Liability of US Borrowers.
          (a) Notwithstanding anything in this Agreement or any other Loan
Documents to the contrary, each US Borrower, jointly and severally, in
consideration of the financial accommodations to be provided by Agent and
Lenders under this Agreement and the other Loan Documents, for the mutual
benefit, directly and indirectly, of each US Borrower and in consideration of
the undertakings of the other US Borrowers to accept joint and several liability
for the Obligations, hereby irrevocably and

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unconditionally accepts, not merely as a surety but also as a co-debtor, joint
and several liability with the other US Borrowers, with respect to the payment
and performance of all of the Obligations, it being the intention of the parties
hereto that all of the Obligations shall be the joint and several obligations of
each US Borrower without preferences or distinction among them. US Borrowers
shall be liable for all amounts due to Agent and Lenders under this Agreement,
regardless of which US Borrower actually receives the Loans or Letter of Credit
Obligations hereunder or the amount of such Revolving Loans received or the
manner in which Agent or any Lender accounts for such Loans, Letter of Credit
Obligations or other extensions of credit on its books and records. The
Obligations of US Borrowers with respect to Revolving Loans made to one of them,
and the Obligations arising as a result of the joint and several liability of
one of the US Borrowers hereunder with respect to Revolving Loans made to the
other of the US Borrowers hereunder, shall be separate and distinct obligations,
but all such other Obligations shall be primary obligations of all US Borrowers.
          (b) If and to the extent that any US Borrower shall fail to make any
payment with respect to any of the Obligations as and when due or to perform any
of the Obligations in accordance with the terms thereof, then in each such
event, the other US Borrowers will make such payment with respect to, or
perform, such Obligation.
          (c) Except as otherwise expressly provided herein, to the extent
permitted by law, each US Borrower (in its capacity as a joint and several
obligor in respect of the obligations of the other US Borrower) hereby waives
notice of acceptance of its joint and several liability, notice of occurrence of
any Event of Default (except to the extent notice is expressly required to be
given pursuant to the terms of this Agreement), or of any demand for any payment
under this Agreement or the other Loan Documents, notice of any action at any
time taken or omitted by Agent or any Lender under or in respect of any of the
obligations hereunder, any requirement of diligence and, generally, all demands,
notices and other formalities of every kind in connection with this Agreement
and the other Loan Documents. Each US Borrower hereby assents to, and waives
notice of, any extension or postponement of the time for the payment of any of
the Obligations, the acceptance of any partial payment thereon, any waiver,
consent or other action or acquiescence by Agent or any Lender at any time or
times in respect of any default by the other US Borrowers in the performance or
satisfaction of any term, covenant, condition or provision of this Agreement,
any and all other indulgences whatsoever by Agent or any Lender in respect of
any of the obligations hereunder, and the taking, addition, substitution or
release, in whole or in part, at any time or times, of any security for any of
such obligations or the addition, substitution or release, in whole or in part,
of the other US Borrowers. Without limiting the generality of the foregoing,
each US Borrower (in its capacity as a joint and several obligor in respect of
the obligations of the other US Borrower) assents to any other action or delay
in acting or any failure to act on the part of Agent or any Lender, including,
without limitation, any failure strictly or diligently to assert any right or to
pursue any remedy or to comply fully with applicable laws or regulations
thereunder which might, but for the provisions of this Section 2.7 hereof,
afford grounds for terminating, discharging or relieving such US Borrower, in
whole or in part, from any of its obligations under this Section 2.7, it being
the intention of each US Borrower that, so long as any of the Obligations
hereunder remain unsatisfied, the obligations of such US Borrower under this
Section 2.7 shall not be discharged except by performance and then only to the
extent of such performance. The obligations of each US Borrower under this
Section 2.7 shall not be diminished or rendered unenforceable by any winding up,
reorganization, arrangement, liquidation, reconstruction or similar proceeding
with respect to any US Borrower. The joint and several liability of the US
Borrowers hereunder shall continue in full force and effect notwithstanding any
absorption, merger, amalgamation or any other change whatsoever in the name,
membership, constitution or place of formation of any US Borrower or any of the
Lenders.

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          (d) The provisions of this Section 2.7 hereof are made for the benefit
of the Lenders and their successors and assigns, and subject to Section 14.3
hereof, may be enforced by them from time to time against any US Borrower as
often as occasion therefor may arise and without requirement on the part of
Agent or any Lender first to marshal any of its claims or to exercise any of its
rights against the other US Borrowers or to exhaust any remedies available to it
against the other US Borrowers or to resort to any other source or means of
obtaining payment of any of the Obligations hereunder or to elect any other
remedy. The provisions of this Section 2.7 shall remain in effect until all the
Obligations shall have been paid in full or otherwise fully satisfied (other
than indemnities and contingent Obligations which have not yet accrued). If at
any time, any payment, or any part thereof, made in respect of any of the
Obligations is rescinded or must otherwise be restored or returned by Agent or
any Lender upon the insolvency, bankruptcy or reorganization of any US Borrower,
or otherwise, the provisions of this Section 2.7 hereof will forthwith be
reinstated and in effect as though such payment had not been made.
          (e) Notwithstanding any provision to the contrary contained herein or
in any of the other Loan Documents, to the extent the obligations of a US
Borrower shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of such US
Borrower hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal, state or provincial and including,
without limitation, the Bankruptcy Code of the United States or Bankruptcy and
Insolvency Act (Canada)).
          (f) With respect to the Obligations arising as a result of the joint
and several liability of US Borrowers hereunder with respect to Loans, Letter of
Credit Obligations or other extensions of credit made to the other US Borrowers
hereunder, each US Borrower waives, until the Obligations shall have been paid
in full (other than indemnities and contingent Obligations which have not yet
accrued) and this Agreement shall have been terminated, any right to enforce any
right of subrogation or any remedy which Agent or any Lender now has or may
hereafter have against any US Borrower, any endorser or any guarantor of all or
any part of the Obligations, and any benefit of, and any right to participate
in, any security or collateral given to Agent or any Lender. Any claim which any
US Borrower may have against any other US Borrower with respect to any payments
to Agent or Lenders hereunder or under any of the other Loan Documents are
hereby expressly made subordinate and junior in right of payment, without
limitation as to any increases in the Obligations arising hereunder or
thereunder, to the prior payment in full in cash of the Obligations. Upon the
occurrence of any Event of Default and for so long as the same is continuing,
Agent and Lenders may proceed directly and at once, without notice (to the
extent notice is waivable under applicable law), against (i) with respect to
Obligations of US Borrowers, either or both of them or (ii) with respect to
Obligations of any US Borrower, to collect and recover the full amount, or any
portion of the applicable Obligations, without first proceeding against the
other applicable US Borrowers or any other Person, or against any security or
collateral for the Obligations. Each US Borrower consents and agrees that Agent
and Lenders shall be under no obligation to marshal any assets in favor of US
Borrower(s) or against or in payment of any or all of the Obligations.
     2.8 Joint and Several Liability of Canadian Borrowers.
          (a) Notwithstanding anything in this Agreement or any other Loan
Documents to the contrary, each Canadian Borrower, jointly and severally, in
consideration of the financial accommodations to be provided by Agent and
Lenders under this Agreement and the other Loan Documents, for the mutual
benefit, directly and indirectly, of each Canadian Borrower and in consideration
of the undertakings of the other Canadian Borrowers to accept joint and several
liability for the Canadian Obligations, hereby irrevocably and unconditionally
accepts, not merely as a surety but also as a co-debtor, joint and several
liability with the other Canadian Borrowers, with respect to the payment and
performance of all of the Canadian Obligations, it being the intention of the
parties hereto that all of the Canadian Obligations shall be the joint and
several Canadian Obligations of each Canadian Borrower without preferences or
distinction among them. Canadian Borrowers shall be liable for all amounts due
to

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Agent and Lenders under this Agreement in respect of the Canadian Credit
Facility, regardless of which Canadian Borrower actually receives the Loans, or
Canadian Letter of Credit Obligations hereunder or the amount of such Revolving
Loans received or the manner in which Agent or any Lender accounts for such
Loans, Canadian Letter of Credit Obligations or other extensions of credit on
its books and records. The Canadian Obligations of Canadian Borrowers with
respect to Revolving Loans and Swing Line Loans made to one of them, and the
Canadian Obligations arising as a result of the joint and several liability of
one of the Canadian Borrowers hereunder, with respect to Revolving Loans made to
the other of the Canadian Borrowers hereunder, shall be separate and distinct
Canadian Obligations, but all such other Canadian Obligations shall be primary
Canadian Obligations of all Canadian Borrowers.
          (b) If and to the extent that any Canadian Borrower shall fail to make
any payment with respect to any of the Canadian Obligations as and when due or
to perform any of the Canadian Obligations in accordance with the terms thereof,
then in each such event, the other Canadian Borrowers will make such payment
with respect to, or perform, such Obligation.
          (c) Except as otherwise expressly provided herein, to the extent
permitted by law, each Canadian Borrower (in its capacity as a joint and several
obligor in respect of the Canadian Obligations of the other Canadian Borrower)
hereby waives notice of acceptance of its joint and several liability, notice of
occurrence of any Event of Default (except to the extent notice is expressly
required to be given pursuant to the terms of this Agreement), or of any demand
for any payment under this Agreement or the other Loan Documents (except to the
extent demand is expressly required to be made pursuant to the terms of this
Agreement or other Loan Document), notice of any action at any time taken or
omitted by Agent or any Lender under or in respect of any of the Canadian
Obligations hereunder, any requirement of diligence and, generally, all demands,
notices and other formalities of every kind in connection with this Agreement
and the other Loan Documents except as required hereunder or under any other
Loan Document. Each Canadian Borrower hereby assents to, and waives notice of,
any extension or postponement of the time for the payment of any of the Canadian
Obligations, the acceptance of any partial payment thereon, any waiver, consent
or other action or acquiescence by Agent or any Lender at any time or times in
respect of any default by the other Canadian Borrowers in the performance or
satisfaction of any term, covenant, condition or provision of this Agreement,
any and all other indulgences whatsoever by Agent or any Lender in respect of
any of the Canadian Obligations hereunder, and the taking, addition,
substitution or release, in whole or in part, at any time or times, of any
security for any of such Canadian Obligations or the addition, substitution or
release, in whole or in part, of the other Canadian Borrowers. Without limiting
the generality of the foregoing, each Canadian Borrower (in its capacity as a
joint and several obligor in respect of the Canadian Obligations of the other
Canadian Borrower) assents to any other action or delay in acting or any failure
to act on the part of Agent or any Lender, including, without limitation, any
failure strictly or diligently to assert any right or to pursue any remedy or to
comply fully with applicable laws or regulations thereunder which might, but for
the provisions of this Section 2.8 hereof, afford grounds for terminating,
discharging or relieving such Canadian Borrower, in whole or in part, from any
of its Canadian Obligations under this Section 2.8, it being the intention of
each Canadian Borrower that, so long as any of the Canadian Obligations
hereunder remain unsatisfied, the Canadian Obligations of such Canadian Borrower
under this Section 2.8 shall not be discharged except by performance and then
only to the extent of such performance. The Canadian Obligations of each
Canadian Borrower under this Section 2.8 shall not be diminished or rendered
unenforceable by any winding up, reorganization, arrangement, liquidation,
reconstruction or similar proceeding with respect to any Canadian Borrower. The
joint and several liability of the Canadian Borrowers hereunder shall continue
in full force and effect notwithstanding any absorption, merger, amalgamation or
any other change whatsoever in the name, membership, constitution or place of
formation of any Canadian Borrower or any of the Lenders.

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          (d) The provisions of this Section 2.8 hereof are made for the benefit
of the Lenders and their successors and assigns, and subject to Section 14.3
hereof, may be enforced by them from time to time against any Canadian Borrower
as often as occasion therefor may arise and without requirement on the part of
Agent or any Lender first to marshal any of its claims or to exercise any of its
rights against the other Canadian Borrowers or to exhaust any remedies available
to it against the other Canadian Borrowers or to resort to any other source or
means of obtaining payment of any of the Canadian Obligations hereunder or to
elect any other remedy. The provisions of this Section 2.8 shall remain in
effect until all the Canadian Obligations shall have been paid in full or
otherwise fully satisfied (other than indemnities and contingent Canadian
Obligations which have not yet accrued). If at any time, any payment, or any
part thereof, made in respect of any of the Canadian Obligations is rescinded or
must otherwise be restored or returned by Agent or any Lender upon the
insolvency, bankruptcy or reorganization of any Canadian Borrower, or otherwise,
the provisions of this Section 2.8 hereof will forthwith be reinstated and in
effect as though such payment had not been made.
          (e) Notwithstanding any provision to the contrary contained herein or
in any of the other Loan Documents, to the extent the Canadian Obligations of a
Canadian Borrower shall be adjudicated to be invalid or unenforceable for any
reason (including, without limitation, because of any applicable provincial or
federal law relating to fraudulent conveyances or transfers) then the Canadian
Obligations of such Canadian Borrower hereunder shall be limited to the maximum
amount that is permissible under applicable law (whether federal, provincial or
state and including, without limitation, the Bankruptcy Code of the United
States and the Bankruptcy and Insolvency Act (Canada)).
          (f) With respect to the Canadian Obligations arising as a result of
the joint and several liability of Canadian Borrowers hereunder with respect to
Loans, Letter of Credit Canadian Obligations or other extensions of credit made
to the other Canadian Borrowers hereunder, each of Canadian Borrowers waives,
until the Canadian Obligations shall have been paid in full (other than
indemnities and contingent Canadian Obligations which have not yet accrued) and
this Agreement shall have been terminated, any right to enforce any right of
subrogation or any remedy which Agent or any Lender now has or may hereafter
have against any Canadian Borrower, any endorser or any guarantor of all or any
part of the Canadian Obligations, and any benefit of, and any right to
participate in, any security or collateral given to Agent or any Lender. Any
claim which any Canadian Borrower may have against any other Canadian Borrower
with respect to any payments to Agent or Lenders hereunder or under any of the
other Loan Documents are hereby expressly made subordinate and junior in right
of payment, without limitation as to any increases in the Canadian Obligations
arising hereunder or thereunder, to the prior payment in full in cash of the
Canadian Obligations. Upon the occurrence of any Event of Default and for so
long as the same is continuing, Agent and Lenders may proceed directly and at
once, without notice (to the extent notice is waivable under applicable law),
against (i) with respect to Canadian Obligations of Canadian Borrowers, either
or both of them or (ii) with respect to Canadian Obligations of any Canadian
Borrower, to collect and recover the full amount, or any portion of the
applicable Canadian Obligations, without first proceeding against the other
applicable Canadian Borrowers or any other Person, or against any security or
collateral for the Canadian Obligations. Each Canadian Borrower consents and
agrees that Agent and Lenders shall be under no obligation to marshal any assets
in favor of Canadian Borrower(s) or against or in payment of any or all of the
Canadian Obligations.
     2.9 Commitments. The aggregate amount of each Lender’s Pro Rata Share of
the Revolving Loans, Swing Line Loans and Letter of Credit Obligations shall not
exceed the amount of such Lender’s Commitment, as the same may from time to time
be amended in accordance with the provisions hereof.

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SECTION 3. INTEREST AND FEES
     3.1 Interest.
          (a) US Borrowers shall pay to Agent, for the benefit of Lenders,
interest on the outstanding principal amount of the US Dollar Loans at the
Interest Rate. Canadian Borrowers shall pay to Agent, for the benefit of
Canadian Lenders, interest on the outstanding principal amount of the Canadian
Loans at the Interest Rate. All interest accruing hereunder on and after the
date of any Event of Default or termination hereof shall be payable on demand.
          (b) Each US Borrower (or Administrative Borrower on behalf of such
Borrower) may from time to time request US Base Rate Loans and each Canadian
Borrower (or Administrative Borrower on behalf of such Borrower) may from time
to time request US Base Rate Loans or Canadian Base Rate Loans, as applicable.
Subject to the terms and conditions contained herein, if Agent receives such a
request on any Business Day, the US Base Rate Loan or Canadian Base Rate Loan
requested in such request shall be made on such Business Day; provided, that, if
Agent receives such a request after 1:00 p.m. on any Business Day, the Base Rate
Loan requested in such request shall be made not later than the next succeeding
Business Day. Each Borrower (or Administrative Borrower on behalf of such
Borrower) may from time to time request Eurodollar Rate Loans or may request
that Eurodollar Rate Loans or may request that US Base Rate Loans or Canadian
Base Rate Loans be converted to Eurodollar Rate Loans or that any existing
Eurodollar Rate Loans continue for an additional Interest Period. Such request
from a Borrower (or Administrative Borrower on behalf of such Borrower) shall
specify the amount of the Eurodollar Rate Loans or the amount of the Base Rate
Loans to be converted to Eurodollar Rate Loans or the amount of the Eurodollar
Rate Loans to be continued (subject to the limits set forth below) and the
Interest Period to be applicable to such Eurodollar Rate Loans (and if it does
not specify such Interest Period shall be deemed to be a one (1) month period).
Subject to the terms and conditions contained herein, three (3) Business Days
after receipt by Agent of such a request from a Borrower (or Administrative
Borrower on behalf of such Borrower), which may be telephonic (and followed by a
confirmation in writing if requested by Agent) such Eurodollar Rate Loans shall
be made or Base Rate Loans shall be converted to Eurodollar Rate Loans or such
Eurodollar Rate Loans shall continue, as the case may be; provided, that, (i) no
Default or Event of Default shall exist or have occurred and be continuing,
(ii) no Borrower or Administrative Borrower shall have sent any notice of
termination of this Agreement, (iii) such Borrower (or Administrative Borrower
on behalf of such Borrower) shall have complied with such customary procedures
as are established by Agent and specified by Agent to Administrative Borrower
from time to time for requests by Borrowers for Eurodollar Rate Loans, (iv) no
more than six (6) Interest Periods may be in effect at any one time, (v) the
aggregate amount of the Eurodollar Rate Loans must be in an amount not less than
$1,000,000 or an integral multiple of $500,000 in excess thereof, and (vi) Agent
and each Lender shall have determined that the Interest Period or Adjusted
Eurodollar Rate is available to Agent and such Lender and can be readily
determined as of the date of the request for such Eurodollar Rate Loan by such
Borrower. Any request by or on behalf of a Borrower for Eurodollar Rate Loans or
to convert US Base Rate Loans to Eurodollar Rate Loans or to continue any
existing Eurodollar Rate Loans shall be irrevocable.
          (c) Any Eurodollar Rate Loans shall automatically convert to US Base
Rate Loans or Canadian Base Rate Loans, as applicable, upon the last day of the
applicable Interest Period, unless Agent has received a request to continue such
Eurodollar Rate Loan at least three (3) Business Days prior to such last day in
accordance with the terms hereof and Borrowers are entitled to such Eurodollar
Rate Loan under the terms hereof.

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          (d) Interest shall be payable by Borrowers to Agent, for the account
of Lenders, monthly in arrears not later than the first day of each calendar
month and shall be calculated on the basis of (i) in the case of US Base Rate
Loans and Eurodollar Rate Loans a three hundred sixty (360) day year, (ii) in
the case of Canadian Base Rate Loans, on the basis of a three hundred and
sixty-five (365) day year or three hundred and sixty-six (366) day year, in each
case based on actual days elapsed. The interest rate on non-contingent
Obligations (other than Eurodollar Rate Loans) shall increase or decrease by an
amount equal to each increase or decrease in the US Base Rate or Canadian Base
Rate, as applicable, effective on the date any change in such Base Rate is
effective.
          (e) For purposes of disclosure under the Interest Act (Canada), where
interest is calculated pursuant thereto at a rate based upon a year of 360, 365
or 366 days, as the case may be (the “First Rate”), the rate or percentage of
interest on a yearly basis is equivalent to such First Rate multiplied by the
actual number of days in the year divided by 360, 365 or 366, as the case may
be.
          (f) If any provision of this Agreement or any of the other Loan
Documents would obligate a Canadian Borrower or Canadian Guarantor to make any
payment of interest or other amount payable to the Agent or a Canadian Lender in
an amount or calculated at a rate which would be prohibited by law or would
result in a receipt by the Agent or such Canadian Lender of interest at a
criminal rate (as construed under the Criminal Code (Canada)), then
notwithstanding that provision, that amount or rate shall be deemed to have been
adjusted with retroactive effect to the maximum amount or rate of interest, as
the case may be, as would not be so prohibited by law or result in a receipt by
the Agent or such Canadian Lender of interest at a criminal rate, the adjustment
to be effected, to the extent necessary, as follows:
               (i) first, by reducing the amount or rate of interest required to
be paid to the Agent or applicable Canadian Lender under this Section 3.1(f)(i);
and
               (ii) thereafter, by reducing any fees, commissions, premiums and
other amounts required to be paid to the Agent or the applicable Lender which
would constitute interest for purposes of the Criminal Code (Canada).
               (iii) Notwithstanding Section 3.1(f)(i), and after giving effect
to all adjustments contemplated thereby, if the Agent or any Canadian Lender
shall have received an amount in excess of the maximum permitted by the Criminal
Code (Canada), then the Canadian Borrowers or Canadian Guarantor, as applicable,
shall be entitled, by notice in writing to the Agent or the affected Canadian
Lender, as the case may be, to obtain reimbursement from the Agent or such
Canadian Lender, as the case may be, in an amount equal to the excess, and
pending reimbursement, the amount of the excess shall be deemed to be an amount
payable by the Agent or such Canadian Lender, as the case may be, to the
Canadian Borrowers.
               (iv) Any amount or rate of interest referred to in this
Section 3.1(f) shall be determined in accordance with generally accepted
actuarial practices and principles as an effective annual rate of interest over
the term that any Obligation remains outstanding on the assumption that any
charges, fees or expenses that fall within the meaning of “interest” (as defined
in the Criminal Code (Canada)) shall, if they relate to a specific period of
time, be pro-rated over that period of time and otherwise be pro-rated over the
period from the date of the incurrence of the Obligation to its relevant
maturity date and, in the event of a dispute, a certificate of a Fellow of the
Canadian Institute of Actuaries appointed by the Agent shall be conclusive for
the purposes of that determination.

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     3.2 Fees.
          (a) Borrowers shall pay to Agent, for the account of Lenders, monthly
an unused line fee at a rate equal to the applicable rate (on a per annum basis)
determined as provided below calculated upon the amount by which the Maximum
Credit exceeds the average daily principal balance of the outstanding Revolving
Loans and Letters of Credit during the immediately preceding month (or part
thereof) so long as any Obligations are outstanding. Such fees shall be payable
on the first Business Day of each month in arrears and calculated based on a
three hundred sixty (360) day year and actual days elapsed. Such percentages
shall be increased or decreased, as the case may be, to the applicable
percentage (on a per annum basis) set forth below based on the Quarterly Average
Excess Availability for the immediately preceding three (3) month period
commencing on the first day of the month of such period.

                  Tier   Quarterly Average Excess Availability   Unused Line Fee
  1    
Greater than $175,000,000
    .625 %   2    
Less than or equal to $175,000,000 and greater than $150,000,000
    .625 %   3    
Less than or equal to $150,000,000 and greater than $125,000,000
    .50 %   4    
Less than or equal to $125,000,000 and greater than $75,000,000
    .50 %   5    
Less than or equal to $75,000,000
    .375 %

provided, that, (i) the applicable percentage shall be calculated and
established once each three (3) month period and shall remain in effect until
adjusted thereafter after the end of such three (3) month period, and
(ii) notwithstanding anything to the contrary contained herein, the applicable
percentages through March 31, 2009 shall be the amount for Tier 3 set forth
above.
          (b) Borrowers shall pay to Agent, for the benefit of Lenders, in the
case of Letters of Credit that are standby Letters of Credit, monthly a fee at
the Standby LC Fee Rate determined as provided below (on a per annum basis) on
the average daily outstanding balance of Letters of Credit that are standby
Letters of Credit, and in the case of Letters of Credit that are commercial
Letters of Credit, monthly a fee at the Commercial LC Fee Rate determined as
provided below (on a per annum basis, on the average daily outstanding balance
of Letters of Credit that are commercial Letters of Credit, in each case for the
immediately preceding month (or part thereof), payable in arrears as of the
first day of each month, computed for each day from the date of issuance to the
date of expiration. Such percentages shall be increased or decreased, as the
case may be, to the applicable percentage (on a per annum basis) set forth below
based on the Quarterly Average Excess Availability for immediately preceding
three (3) month period commencing on the first day of the month of such period.

                                  Quarterly Average   Commercial LC   Standby LC
Tier   Excess Availability   Fee Rate   Fee Rate   1    
Greater than $175,000,000
    2.50 %     2.50 %   2    
Less than or equal to $175,000,000 and greater than $150,000,000
    2.75 %     2.75 %   3    
Less than or equal to $150,000,000 and greater than $125,000,000
    3.00 %     3.00 %

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                                  Quarterly Average   Commercial LC   Standby LC
Tier   Excess Availability   Fee Rate   Fee Rate   4    
Less than or equal to $125,000,000 and greater than $75,000,000
    3.25 %     3.25 %   5    
Less than or equal to $75,000,000
    3.50 %     3.50 %

provided, that, (i) the applicable percentage shall be calculated and
established once each three (3) month period and shall remain in effect until
adjusted thereafter after the end of the next three (3) month period,
(ii) notwithstanding anything to the contrary contained herein, the applicable
percentages through March 31, 2009 shall be the amount for Tier 3 set forth
above, and (iii) Borrowers shall, at Agent’s option or at the written direction
of the Required Lenders, pay such fees at a rate two (2%) percent greater than
the then applicable rate on such average daily maximum amount for: (A) the
period from and after the date of termination or non-renewal hereof until
Lenders have received full and final payment of all Obligations (notwithstanding
entry of a judgment against any Borrower or Guarantor) and (B) the period from
and after the date of the occurrence of an Event of Default for so long as such
Event of Default is continuing. Such letter of credit fees shall be calculated
on the basis of a three hundred sixty (360) day year in the case of Letters of
Credit issued by a US Issuing Bank and 365 or 366 days, as applicable, in the
case of Letters of Credit issued by a Canadian Issuing Bank and actual days
elapsed and the obligation of Borrowers to pay such fee shall survive the
termination or non-renewal of this Agreement. In addition to the letter of
credit fees provided above, Borrowers shall pay monthly to Issuing Bank for its
own account (without sharing with Lenders) the letter of credit fronting fee of
one-eighth (0.125%) percent per annum and the other customary charges from time
to time of Issuing Bank with respect to the issuance, amendment, transfer,
administration, cancellation and conversion of, and drawings under, such Letters
of Credit.
          (c) Borrowers shall pay to Agent and Arranger the other fees and
amounts set forth in the Fee Letter in the amounts and at the times specified
therein or as has otherwise been agreed by or on behalf of Borrowers. To the
extent payment in full of the applicable fee is received by Agent from Borrowers
on or about the date hereof, Agent shall pay to each Lender its share of such
fees in accordance with the terms of the arrangements of Agent with such Lender.
     3.3 Inability to Determine Applicable Interest Rate. If in connection with
any request for a Eurodollar Rate Loan or a conversion to or continuation
thereof that (a) Agent shall have determined in good faith (which determination
shall be final, conclusive and binding upon all parties hereto) or have received
a notice or notices from Required Lenders that Dollar deposits are not being
offered to banks in the London interbank market for the applicable amount and
Interest Period of such Eurodollar Rate Loan, (b) Agent shall have determined in
good faith (which determination shall be final, conclusive and binding upon all
parties hereto) that adequate and reasonable means do not exist for determining
the Eurodollar Rate for any requested Interest Period with respect to a proposed
Eurodollar Rate Loan, (c) the applicable Reuters Screen Page is not available
for the timely determination of the Eurodollar Rate, and the Eurodollar Rate
cannot otherwise be determined in a timely manner in accordance with the
definition of “Adjusted Eurodollar Rate”, or (d) Agent has received notice from
Required Lenders that the Eurodollar Rate for any requested Interest Period with
respect to a proposed Eurodollar Rate Loan does not adequately and fairly
reflect the cost to such Lenders of funding such Loan, Agent will promptly so
notify the Administrative Borrower. Thereafter, the obligation of the Lenders to
make or maintain Eurodollar Rate Loans shall be suspended until Agent (upon the
instruction of the Required Lenders) revokes such notice. Upon receipt of such
notice, Borrowers may revoke any pending request for a Eurodollar Rate Loan or
conversion to or continuation of Eurodollar Rate Loans or, failing that, will be
deemed to have converted such request into a request for a Base Rate Loan in the
amount specified therein.

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     3.4 Illegality. Notwithstanding anything to the contrary contained herein,
if any change in any law or interpretation thereof by any Governmental Authority
makes it unlawful for a Lender to make or maintain a Eurodollar Rate Loan or to
maintain any Commitment with respect to a Eurodollar Rate Loan, then such Lender
shall give notice thereof to Agent and Administrative Borrower and may
(a) declare that Eurodollar Rate Loans will not thereafter be made by such
Lender, such that any request for a Eurodollar Rate Loans from such Lender shall
be deemed to be a request for a Base Rate Loan unless such Lender’s declaration
has been withdrawn (and it shall be withdrawn promptly upon the cessation of the
circumstances described above) and (b) require that all outstanding Eurodollar
Rate Loans made by such Lender be converted to Base Rate Loans immediately, in
which event all outstanding Eurodollar Rate Loans of such Lender shall be so
converted.
     3.5 Increased Costs. If any Change in Law shall: (a) impose, modify or deem
applicable any reserve, special deposit, compulsory loan, insurance charge or
similar requirement against assets of, deposits with or for the account of, or
credit extended or participated in by, any Lender (except any reserve
requirement reflected in the Adjusted Eurodollar Rate) or the Issuing Bank; (b)
subject any Lender or the Issuing Bank to any tax of any kind whatsoever with
respect to this Agreement, any Letter of Credit, any participation in a Letter
of Credit or any Eurodollar Loan made by it, or change the basis of taxation of
payments to such Lender or the Issuing Bank in respect thereof (except for Taxes
or Other Taxes covered by Section 6.8 and the imposition of, or any change in
the rate of, any taxes payable by such Lender or the Issuing Bank described in
Section 6.8 hereof); or (c) impose on any Lender or the Issuing Bank or the
London interbank market any other condition, cost or expense affecting this
Agreement or Eurodollar Rate Loans made by such Lender or any Letter of Credit
or participation therein, and the result of any of the foregoing shall be to
increase the cost to such Lender of making or maintaining any Eurodollar Rate
Loan (or of maintaining its obligation to make any such Loan), or to increase
the cost to such Lender or the Issuing Bank of participating in, issuing or
maintaining any Letter of Credit (or of maintaining its obligation to
participate in or to issue any Letter of Credit), or to reduce the amount of any
sum received or receivable by such Lender or the Issuing Bank hereunder (whether
of principal, interest or any other amount) then, upon request of such Lender or
the Issuing Bank, Borrowers will pay to such Lender or the Issuing Bank, as the
case may be, such additional amount or amounts as will compensate such Lender or
the Issuing Bank, as the case may be, for such additional costs incurred or
reduction suffered.
     3.6 Capital Requirements. If any Lender or the Issuing Bank determines in
good faith that any Change in Law affecting such Lender or the Issuing Bank or
any lending office of such Lender or such Lender’s or the Issuing Bank’s holding
company, if any, regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender’s or the Issuing Bank’s capital or on
the capital of such Lender’s or the Issuing Bank’s holding company, if any, as a
consequence of this Agreement, the Commitments of such Lender or the Loans made
by, or participations in Letters of Credit held by, such Lender, or the Letters
of Credit issued by the Issuing Bank, to a level below that which such Lender or
the Issuing Bank or such Lender’s or the Issuing Bank’s holding company could
have achieved but for such Change in Law (taking into consideration such
Lender’s or the Issuing Bank’s policies and the policies of such Lender’s or the
Issuing Bank’s holding company with respect to capital adequacy), then from time
to time Borrowers will pay to such Lender or the Issuing Bank, as the case may
be, such additional amount or amounts as will compensate such Lender or the
Issuing Bank or such Lender’s or the Issuing Bank’s holding company for any such
reduction suffered.

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     3.7 Certificates for Reimbursement. A certificate of a Lender or the
Issuing Bank setting forth the amount or amounts necessary to compensate such
Lender or the Issuing Bank or its holding company, as the case may be, as
specified in Sections 3.5 or 3.6 and delivered to Administrative Borrower shall
be conclusive absent manifest error. Borrowers shall pay such Lender or the
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within fifteen (15) days after receipt thereof.
     3.8 Delay in Requests. Failure or delay on the part of any Lender or the
Issuing Bank to demand compensation pursuant to Sections 3.5 or 3.6 shall not
constitute a waiver of such Lender’s or the Issuing Bank’s right to demand such
compensation; provided, that, Borrowers shall not be required to compensate a
Lender or the Issuing Bank pursuant to this Section for any increased costs
incurred or reductions occurring more than one hundred eighty (180) days prior
to the date that such Lender or the Issuing Bank, as the case may be, becomes
aware of the event giving rise to such Lender’s or Issuing Bank’s claim for
compensation therefor (except that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the one hundred eighty
(180) day period referred to above shall be extended to include the period of
retroactive effect thereof).
     3.9 Mitigation; Replacement of Lenders.
          (a) If any Lender requests compensation under Sections 3.4, 3.5 or
Section 3.6, or Borrowers are required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 6.8, then such Lender shall, if requested by Administrative Borrower,
use reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder, to assign its rights and obligations hereunder to
another of its offices, branches or affiliates or to take such other actions as
such Lender or Agent determines, if, in the good faith judgment of such Lender,
such designation, assignment or other action (i) would eliminate or reduce
amounts payable pursuant to such Sections in the future and (ii) would not
subject Agent or such Lender to any unreimbursed cost or expense and Agent or
such Lender would not suffer any economic, legal or regulatory disadvantage.
Nothing in this Section 3.9 shall affect or postpone any of the obligations of
Borrowers or the rights of Agent or such Lender pursuant to this Section 3.9.
Borrowers hereby agree to pay on demand all reasonable costs and expenses
incurred by Agent or any Lender in connection with any such designation or
assignment.
          (b) If any Lender requests compensation under Sections 3.4, 3.5 or
3.6, or if Borrowers are required to pay any additional amount to any Lender or
Governmental Authority pursuant to Section 6.8, then within sixty (60) days
thereafter, Administrative Borrower may, at its sole expense and effort, upon
notice to such Lender and Agent, replace such Lender by requiring such Lender to
assign and delegate (and such Lender shall be obligated to assign and delegate),
without recourse (in accordance with and subject to the restrictions contained
in Section 15.7), all of its interests, rights and obligations under this
Agreement to an Eligible Transferee that shall assume such obligations;
provided, that, (i) Administrative Borrower has received the prior written
consent of Agent and each Issuing Bank (which consent shall not be unreasonably
withheld, conditioned or delayed), (ii) such Lender shall have received payment
of an amount equal to the outstanding principal amount of its Loans and
participations in Letter of Credit Obligations and Swing Line Loans that it has
funded, if any, accrued interest thereon, accrued fees and other amounts payable
to it hereunder, from the assignee (to the extent of such outstanding principal)
and Administrative Borrower (in the case of accrued interest, fees and other
amounts, including amounts under Section 3.10), (iii) such assignment will
result in a reduction in such compensation and payments, and (iv) such
assignment does not conflict with applicable laws or regulations. A Lender shall
not be required to make any such assignment and delegation if, prior thereto, as
a result of a waiver by such Lender or otherwise, the circumstances entitling
the Administrative Borrower to require such assignment and delegation cease to
apply. Nothing in this Section 3.9 shall impair any rights that any Borrower or
Agent may have against any Lender that is a Defaulting Lender.

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     3.10 Funding Losses. Borrowers shall pay to each Lender all losses,
expenses and liabilities (including any interest paid by such Lender to Lenders
of funds borrowed by it to make or carry its Eurodollar Rate Loans and any loss,
expense or liability sustained by such Lender in connection with the liquidation
or redeployment of such) that it sustains (a) if for any reason (other than a
default by such Lender) a borrowing of any Eurodollar Rate Loan does not occur
on a date specified therefor in a request for borrowing, or a conversion to or
continuation of, any Eurodollar Rate Loan does not occur on a date specific
therefor in a request for conversion or continuation, (b) if any prepayment or
other principal payment of, or any conversion of, any of its Eurodollar Rate
Loans occurs on a date prior to the last day of an Interest Period applicable to
such Loan, or (c) if any prepayment of any of its Eurodollar Rate Loans is not
made on any date specified in a notice of prepayment given by a Borrower (or on
its behalf by Administrative Borrower). This covenant shall survive the
termination or non-renewal of this Agreement and the payment of the Obligations.
     3.11 Maximum Interest. Notwithstanding anything to the contrary contained
in this Agreement or any of the other Loan Documents, in no event whatsoever
shall the aggregate of all amounts that are contracted for, charged or received
by Agent or any Lender pursuant to the terms of this Agreement or any of the
other Loan Documents and that are deemed interest under applicable law exceed
the Maximum Interest Rate (including, to the extent applicable, the provisions
of Section 5197 of the Revised Statutes of the United States of America as
amended, 12 U.S.C. Section 85, as amended). In no event shall any Borrower or
Guarantor be obligated to pay interest or such amounts as may be deemed interest
under applicable law in amounts which exceed the Maximum Interest Rate. In the
event any Interest is charged or received in excess of the Maximum Interest Rate
(“Excess”), each Borrower and Guarantor acknowledges and stipulates that any
such charge or receipt shall be the result of an accident and bona fide error,
and that any Excess received by Agent or any Lender shall be applied, first, to
the payment of the then outstanding and unpaid principal hereunder; second to
the payment of the other Obligations then outstanding and unpaid; and third,
returned to such Borrower or Guarantor. All monies paid to Agent or any Lender
hereunder or under any of the other Loan Documents, whether at maturity or by
prepayment, shall be subject to any rebate of unearned interest as and to the
extent required by applicable law. For the purpose of determining whether or not
any Excess has been contracted for, charged or received by Agent or any Lender,
all interest at any time contracted for, charged or received from any Borrower
or Guarantor in connection with this Agreement or any of the other Loan
Documents shall, to the extent permitted by applicable law, be amortized,
prorated, allocated and spread during the entire term of this Agreement in
accordance with the amounts outstanding from time to time hereunder and the
Maximum Interest Rate from time to time in effect in order to lawfully charge
the maximum amount of interest permitted under applicable laws. The provisions
of this Section 3.11 shall be deemed to be incorporated into each of the other
Loan Documents (whether or not any provision of this Section is referred to
therein).
     3.12 No Requirement of Match Funding. Notwithstanding anything to the
contrary contained herein, Agent and Lenders shall not be required to acquire US
Dollar deposits in the London interbank market or any other offshore US Dollar
market to fund any Eurodollar Rate Loan or to otherwise match fund any
Obligations as to which interest accrues based on the Adjusted Eurodollar Rate.
All of the provisions of this Section 3 shall be deemed to apply as if Agent,
each Lender or any Participant had acquired such deposits to fund any Eurodollar
Rate Loan or any other Obligation as to which interest is accruing at the
Adjusted Eurodollar Rate by acquiring such US Dollar deposits for each Interest
Period in the amount of the Eurodollar Rate Loans or other applicable
Obligations.
SECTION 4. CONDITIONS PRECEDENT
     4.1 Conditions Precedent to Initial Loans and Letters of Credit. The
obligation of Lenders to make the initial Loans or of Issuing Bank to provide
for the initial Letters of Credit hereunder is subject to the satisfaction of,
or waiver of, immediately prior to or concurrently with the making of such Loan
or the issuance of such Letter of Credit of each of the following conditions
precedent:

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          (a) Agent shall have received, in form and substance satisfactory to
Agent, all releases, terminations and such other documents as Agent may request
to evidence and effectuate the termination and release of any interest in and to
any assets and properties of each Borrower and Guarantor that is not a Permitted
Lien, duly authorized, executed and delivered by it or each of them, including,
but not limited to, (i) UCC termination statements for all UCC financing
statements previously filed with respect to any such interests that do not
constitute Permitted Liens, filed against any Borrower or Guarantor, as debtor;
(ii) PPSA terminations or discharges for all PPSA financing statements
previously filed with respect to any such interests that do not constitute
Permitted Liens, filed against any Borrower or Guarantor, as debtor; and (iii)
satisfactions and discharges of any mortgages, deeds of trust or deeds to secure
debt by any Borrower or Guarantor that do not constitute Permitted Liens, in
form acceptable for recording with the appropriate Governmental Authority;
          (b) all requisite corporate action and proceedings in connection with
this Agreement and the other Loan Documents shall be reasonably satisfactory in
form and substance to Agent, and Agent shall have received all information and
copies of all documents, including records of requisite corporate action and
proceedings which Agent may have reasonably requested in connection therewith,
such documents where requested by Agent or its counsel to be certified by
appropriate corporate officers or Governmental Authority (and including a copy
of the certificate of incorporation or formation of each Borrower and Guarantor
certified by the Secretary of State (or equivalent Governmental Authority) which
shall set forth the same complete corporate name of such Borrower or Guarantor
as is set forth herein and such document as shall set forth the organizational
identification number of each Borrower or Guarantor, if one is issued in its
jurisdiction of incorporation);
          (c) no Material Adverse Effect shall have occurred since December 31,
2007;
          (d) no material pending or threatened in writing, litigation,
proceeding, bankruptcy or insolvency, injunction, order or claim with respect to
Borrowers and Guarantors shall exist;
          (e) no default or event of default under the Opco Notes or in respect
of any other material Indebtedness of any Borrower or Guarantor shall exist;
          (f) Agent shall have completed a field review of the Records and such
other information with respect to the Collateral as Agent may reasonably require
to determine the amount of Loans available to Borrowers (including, without
limitation, current perpetual inventory records and/or roll-forwards of Accounts
and Inventory through the date of closing and test counts of the Inventory in a
manner reasonably satisfactory to Agent, together with such supporting
documentation as may be reasonably necessary or appropriate, and other documents
and information that will enable Agent to accurately identify and verify the
Collateral), the results of which in each case shall be satisfactory to Agent,
not more than five (5) Business Days prior to the date hereof or such earlier
date as Agent may agree;
          (g) Agent shall have received, in form and substance satisfactory to
Agent, all consents, waivers, acknowledgments and other agreements from third
persons which Agent may deem necessary or desirable in order to permit, protect
and perfect its security interests in and liens upon the Collateral or to
effectuate the provisions or purposes of this Agreement and the other Loan
Documents, including, without limitation, Collateral Access Agreements;

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          (h) Agent shall have received, in form and substance reasonably
satisfactory to Agent, Deposit Account Control Agreements by and among Agent,
each Borrower and Guarantor, as the case may be and each bank where such
Borrower (or Guarantor) has a deposit account as contemplated by Section 6.6
hereof, in each case, duly authorized, executed and delivered by such bank and
Borrower or Guarantor, as the case may be (or Agent shall be the bank’s customer
with respect to such deposit account as Agent may specify);
          (i) Agent shall have received evidence, in form and substance
reasonably satisfactory to Agent, that Agent has a valid perfected first
priority security interest in all of the Collateral (except as to (i) priority,
subject to the liens permitted under clauses (b), (c), (i) and (j) of
Section 10.2 hereof, to the extent that such liens have priority over the liens
of Agent under applicable law and except for such items of Collateral as Agent
may determine not to perfect its security interest in based on the de minimus
value thereof relative to the cost of such perfection and (ii) Intellectual
Property registered, applied for or subsisting solely outside of the United
States of America);
          (j) Agent shall have received and reviewed lien and judgment search
results for the jurisdiction of organization of each Borrower and Guarantor, the
jurisdiction of the chief executive office of each Borrower and Guarantor and
all jurisdictions in which assets of Borrowers and Guarantors are located, which
search results shall be in form and substance satisfactory to Agent;
          (k) Agent shall have received originals of the shares of the stock and
any membership interest certificates, as applicable, representing all of the
issued and outstanding shares of the Equity Interests of each Borrower and
Guarantor (other than Parent) and owned by any Borrower or Guarantor, in each
case together with stock powers duly executed in blank with respect thereto;
          (l) Agent shall have received an officer’s certificate prepared by the
chief financial officer of Borrowers as to the financial condition, solvency and
related matters of Borrowers after giving effect to the initial borrowings under
the Loan Documents, in substantially the form of Exhibit D hereto (the “Solvency
Certificate”);
          (m) the Global Excess Availability, on or about the date hereof, shall
be not less than $75,000,000 (of which not less than the US Dollar Equivalent of
$15,000,000 shall be Canadian Excess Availability) after giving effect to the
initial Loans made or to be made and Letters of Credit issued or to be issued in
connection with the initial transactions hereunder;
          (n) Agent shall have received a borrowing request and a Borrowing Base
Certificate setting forth the Loans and Letters of Credit available to Borrowers
as of the date hereof as completed in a manner reasonably satisfactory to Agent
and duly authorized, executed and delivered on behalf of Borrowers;
          (o) Agent shall have received (i) projected monthly consolidating (as
between US Borrowers and Canadian Borrower), and consolidated (including only
Borrowers and Guarantors) balance sheets, income statements, statements of cash
flows and availability of Borrowers and Guarantors for the period through the
end of the 2008 fiscal year of Borrowers and Guarantors, (ii) projected annual
consolidating (as between US Borrowers and Canadian Borrower), and consolidated
(including only Borrowers and Guarantors) balance sheets, income statements,
statements of cash flows and availability of Borrowers and Guarantors through
the end of the 2013 fiscal year of Borrowers and Guarantors, in each case as to
the projections described in clauses (i) and (ii), with the results and
assumptions set forth in all of such projections in form and substance
satisfactory to Agent and a pro-forma balance sheet of Parent and Subsidiaries
reflecting the initial transactions contemplated hereunder, including, but not
limited to Loans and Letter of Credit Obligations outstanding on the date hereof
and the use of the

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proceeds of the initial Loans as provided herein, accompanied by a certificate,
dated of even date herewith, of Parent stating that such pro-forma balance sheet
was prepared in good faith by an authorized officer of Parent and based on
assumptions that are reasonable in light of all facts and circumstances known to
Parent at such time, (iii) any updates or modifications to the projected
financial statements of Borrowers and Guarantors previously received by Agent,
in each case in form and substance satisfactory to Agent (which will be deemed
satisfactory if in the same form as projections previously provided to Agent and
so long as the EBITDA for each year in such updates or modifications are not
less than eighty (80%) percent of the EBITDA for such year in the projections
provided to Agent prior to the date hereof), and (iv) interim unaudited
financial statements for each monthly period ended since the last audited
financial statements for which financial statements are available (which monthly
statements will be consistent in form with such statements previously provided
to Agent, but otherwise are not required to be in substance satisfactory to
Agent);
          (p) Agent shall have received evidence of insurance and loss payee
endorsements required hereunder and under the other Loan Documents, in form and
substance reasonably satisfactory to Agent, and certificates of insurance
policies and/or endorsements naming Agent as loss payee;
          (q) Agent shall have received, in form and substance reasonably
satisfactory to Agent, such opinion letters of counsel to Borrowers and
Guarantors with respect to the Loan Documents and such other matters as Agent
may request; and
          (r) the other Loan Documents and all instruments and documents
hereunder and thereunder shall have been duly executed and delivered to Agent,
in form and substance satisfactory to Agent.
          (s) without limiting the generality of the provisions of Section 14.2
for purposes of determining compliance with the conditions specified in this
Section 4.1, 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 Agent shall have received notice from such
Lender prior to the date hereof specifying its objection thereto.
     4.2 Conditions Precedent to All Loans and Letters of Credit. The obligation
of Lenders to make the Loans, including the initial Loans, or of Issuing Bank to
issue any Letter of Credit, including the initial Letters of Credit, is subject
to the further satisfaction of, or waiver of, immediately prior to or
concurrently with the making of each such Loan or the issuance of such Letter of
Credit of each of the following conditions precedent:
          (a) all representations and warranties contained herein and in the
other Loan Documents that are qualified as to materiality or Material Adverse
Effect shall be true and correct and the representations and warranties that are
not so qualified shall be true and correct in all material respects, in each
case with the same effect as though such representations and warranties had been
made on and as of the date of the making of each such Loan or providing each
such Letter of Credit and after giving effect thereto, except to the extent that
such representations and warranties expressly relate solely to an earlier date
(in which case such representations and warranties shall have been true and
correct to the extent required hereunder or under the other Loan Documents on
and as of such earlier date);
          (b) no law, regulation, order, judgment or decree of any Governmental
Authority shall exist, and no action, suit, investigation, litigation or
proceeding shall be pending or threatened in any court or before any arbitrator
or Governmental Authority, which purports to enjoin, prohibit, restrain or
otherwise affect (i) the making of the Loans or providing the Letters of Credit,
or (ii) the consummation of the transactions contemplated pursuant to the terms
hereof or the other Loan Documents; and

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          (c) no Default or Event of Default shall exist or have occurred and be
continuing on and as of the date of the making of such Loan or providing each
such Letter of Credit and after giving effect thereto.
     4.3 Conditions Precedent to Real Property Availability. Upon the written
request of the applicable US Borrower with respect to any parcel of the Eligible
Real Property owned by such US Borrower or the Canadian Borrower with respect to
any parcel of the Eligible Real Property owned by the Canadian Borrower, such
Eligible Real Property shall be included in the calculation of the applicable
Borrowing Base on the Business Day after each of the following conditions
precedent have been satisfied:
          (a) Agent shall have received environmental audits of the Real
Property subject to such Mortgage conducted by an independent environmental
engineering firm acceptable to Agent, and in form, scope and methodology
reasonably satisfactory to Agent, confirming (i) such Borrower is in compliance
with all material applicable Environmental Laws and (ii) the absence of any
material environmental problems (provided, that, to the extent that the results
of such environmental audits disclose any condition, event or circumstance that
would adversely affect the value of the Real Property or the ability of Agent to
realize thereon, Agent may, upon the applicable Real Property Availability being
included in the calculation of the applicable Borrowing Base, establish Reserves
to reflect such adverse affect (and the amount of any Reserve established by
Agent shall have a reasonable relationship to the event, condition or other
matter which is the basis for such Reserve as determined by Agent in good faith)
or if material as to a particular property determine that such property should
not be considered Eligible Real Property);
          (b) Agent shall have received, in form and substance reasonably
satisfactory to Agent, a valid and effective title insurance policy or pro forma
thereof issued by a company and agent reasonably acceptable to Agent:
(i) insuring the priority, amount and sufficiency of such Mortgage, (ii)
insuring against matters that would be disclosed by surveys and (iii) containing
any legally available endorsements, assurances or affirmative coverage
reasonably requested by Agent for protection of its interests;
          (c) Agent shall have received a written appraisal as to such owned
Real Property subject to such Mortgage, at the expense of Borrowers, by an
appraiser acceptable to Agent, addressed to Agent and on which Agent and Lenders
are expressly permitted to rely, in form, scope and methodology reasonably
satisfactory to Agent;
          (d) Agent shall have received ALTA certified survey of such Real
Property subject to such Mortgage, completed not more than ninety (90) days
prior to the date that the such Real Property Availability is included in the
applicable Borrowing Base by a registered land surveyor certified by such
surveyor to Agent and the title insurance company indicating, among other
things, exterior boundary lines, measurements of the distance between buildings
and boundary lines, locations of fences, drives, utility and other easements,
encroachments, existing buildings, ingress and egress and with a legal
description, together with endorsements or amendments to the title insurance
policies with respect to the Mortgage deleting all survey exceptions to the
insurance coverage provided to Agent thereunder and adding such additional
endorsements to the insurance coverage available based on the survey of the Real
Property subject to such Mortgage being available;

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          (e) Agent shall have received evidence, in form and substance
reasonably satisfactory to Agent, that the applicable Borrower is the owner of
such Real Property subject to the Mortgage it has executed and delivered a
valid, binding and enforceable Mortgage in favor of Agent with respect to such
Real Property and that Agent has a valid and enforceable, first priority
mortgage and lien upon, and security interest in, the Real Property of the
applicable Borrower that is subject to the Mortgage;
          (f) no Default or Event of Default shall exist or have occurred and be
continuing;
          (g) Agent shall have received, in form and substance reasonably
satisfactory to Agent, an opinion letter of counsel to the applicable Borrower
with respect to the enforceability of such Mortgage for the Real Property
(including that the Mortgage is in proper form under the applicable state law,
that the Mortgage creates a valid mortgage lien on the Real Property described
therein, that it is valid, binding and enforceable and such other matters as
Agent may reasonably require) from counsel licensed to practice law in the
jurisdiction where such Real Property is located;
          (h) Agent shall have received, in form and substance reasonably
satisfactory to Agent, a flood hazard zone search with respect to such Real
Property located in the United States and, if applicable, flood insurance issued
by an insurance company reasonably satisfactory to Agent no matter where such
Real Property may be located; and
          (i) Agent shall have received a borrowing request and a Borrowing Base
Certificate setting forth the Loans and Letters of Credit available to the
applicable Borrower as of the date a parcel of Real Property is requested to
become eligible as completed in a manner reasonably satisfactory to Agent and
duly authorized, executed and delivered on behalf of Borrowers.
SECTION 5. GRANT AND PERFECTION OF SECURITY INTEREST
     5.1 Grant of Security Interest. To secure payment and performance of all
Obligations, each US Loan Party hereby grants to Agent, for itself and the
benefit of Secured Parties, and to secure payment and performance of all
Canadian Obligations, each Canadian Loan Party hereby grants to Agent, for
itself and the benefit of Secured Parties, a continuing security interest in, a
lien upon, and a right of set off against, and hereby collaterally assigns to
Agent, for itself and the benefit of Secured Parties, as security, all personal
and real property and fixtures, and interests in property and fixtures, of each
Borrower and Guarantor, whether now owned or hereafter acquired or existing, and
wherever located (together with all other collateral security for the
Obligations at any time granted to or held or acquired by Agent or any Lender,
collectively, the “Collateral”), including all of each Borrower’s and
Guarantor’s right, title and interest in and to the following:
          (a) all Accounts;
          (b) all general intangibles, including, without limitation, all
Intellectual Property;
          (c) all goods, including, without limitation, Inventory and Equipment;
          (d) all Real Property and fixtures;
          (e) all chattel paper, including, without limitation, all tangible and
electronic chattel paper;
          (f) all instruments, including, without limitation, all promissory
notes;
          (g) all documents;

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          (h) all deposit accounts;
          (i) all letters of credit, banker’s acceptances and similar
instruments and including all letter-of-credit rights;
          (j) all supporting obligations and all present and future liens,
security interests, rights, remedies, title and interest in, to and in respect
of Receivables and other Collateral, including (i) rights and remedies under or
relating to guaranties, contracts of suretyship, letters of credit and credit
and other insurance related to the Collateral, (ii) rights of stoppage in
transit, replevin, repossession, reclamation and other rights and remedies of an
unpaid vendor, lienor or secured party, (iii) goods described in invoices,
documents, contracts or instruments with respect to, or otherwise representing
or evidencing, Receivables or other Collateral, including returned, repossessed
and reclaimed goods, and (iv) deposits by and property of account debtors or
other persons securing the obligations of account debtors;
          (k) all (i) investment property (including securities, whether
certificated or uncertificated, securities accounts, security entitlements,
commodity contracts or commodity accounts) and (ii) monies, credit balances,
deposits and other property of any Borrower or Guarantor now or hereafter held
or received by or in transit to Agent, any Lender or its Affiliates or at any
other depository or other institution from or for the account of any Borrower or
Guarantor, whether for safekeeping, pledge, custody, transmission, collection or
otherwise;
          (l) all commercial tort claims, including, without limitation, those
identified in the Information Certificate;
          (m) to the extent not otherwise described above, all Receivables;
          (n) all Records; and
          (o) all products and proceeds of the foregoing, in any form, including
insurance proceeds and all claims against third parties for loss or damage to or
destruction of or other involuntary conversion of any kind or nature of any or
all of the other Collateral.
     Notwithstanding the use of the phrase “collaterally assigns” in Section 5.1
hereof, the interest granted to Agent under Section 5.1 shall not be deemed to
be an absolute assignment of any trademarks or other Collateral but rather is
intended to be a lien and security interest in such trademark and other
Collateral.
     5.2 Perfection of Security Interests.
          (a) Each Borrower and Guarantor irrevocably and unconditionally
authorizes Agent (or its agent) to file at any time and from time to time such
financing statements with respect to the Collateral naming Agent or its designee
as the secured party and such Borrower or Guarantor as debtor, as Agent may
require, and including any other information with respect to such Borrower or
Guarantor or otherwise required by part 5 of Article 9 of the Uniform Commercial
Code or under the PPSA of such jurisdiction as Agent may determine, together
with any amendment and continuations with respect thereto, which authorization
shall apply to all financing statements filed on, prior to or after the date
hereof. Each Borrower and Guarantor hereby ratifies and approves all financing
statements naming Agent or its designee as secured party and such Borrower or
Guarantor, as the case may be, as debtor with respect to the Collateral (and any
amendments with respect to such financing statements) filed by or on behalf of
Agent prior to the date hereof and ratifies and confirms the authorization of
Agent to file such financing statements (and amendments, if any). Each Borrower
and Guarantor hereby authorizes Agent

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to adopt on behalf of such Borrower and Guarantor any symbol required for
authenticating any electronic filing. In the event that the description of the
collateral in any financing statement naming Agent or its designee as the
secured party and any Borrower or Guarantor as debtor includes assets and
properties of such Borrower or Guarantor that do not at any time constitute
Collateral, whether hereunder, under any of the other Loan Documents or
otherwise, the filing of such financing statement shall nonetheless be deemed
authorized by such Borrower or Guarantor to the extent of the Collateral
included in such description and it shall not render the financing statement
ineffective as to any of the Collateral or otherwise affect the financing
statement as it applies to any of the Collateral. In no event shall any Borrower
or Guarantor at any time file, or permit or cause to be filed, any correction
statement or termination statement with respect to any financing statement (or
amendment or continuation with respect thereto) naming Agent or its designee as
secured party and such Borrower or Guarantor as debtor.
          (b) Each Borrower and Guarantor does not have any chattel paper
(whether tangible or electronic) or instruments as of the date hereof, except as
set forth in the Information Certificate. In the event that any Borrower or
Guarantor shall be entitled to or shall receive any chattel paper or instrument
for obligation in excess of $200,000 in any one case or $500,000 in the
aggregate that constitutes Collateral after the date hereof, Borrowers and
Guarantors shall promptly notify Agent thereof in writing. Promptly upon the
receipt thereof by or on behalf of any Borrower or Guarantor (including by any
agent or representative), such Borrower or Guarantor shall deliver, or cause to
be delivered to Agent, all tangible chattel paper and instruments that such
Borrower or Guarantor has or may at any time acquire, accompanied by such
instruments of transfer or assignment duly executed in blank as Agent may from
time to time specify, in each case except as Agent may otherwise agree. At
Agent’s option, each Borrower and Guarantor shall, or Agent may at any time on
behalf of any Borrower or Guarantor, cause the original of any such instrument
or chattel paper to be conspicuously marked with the following legend referring
to chattel paper or instruments as applicable: “This [chattel paper][instrument]
is subject to the security interest of Wachovia Bank, National Association, as
Agent, and any sale, transfer, assignment or encumbrance of this [chattel
paper][instrument] violates the rights of such secured party.”
          (c) In the event that any Borrower or Guarantor shall at any time hold
or acquire an interest in any electronic chattel paper or any “transferable
record” (as such term is defined in Section 201 of the Federal Electronic
Signatures in Global and National Commerce Act or in Section 16 of the Uniform
Electronic Transactions Act as in effect in any relevant jurisdiction) that
constitutes Collateral, such Borrower or Guarantor shall promptly notify Agent
thereof in writing. Promptly upon Agent’s request, such Borrower or Guarantor
shall take, or cause to be taken, such actions as Agent may reasonably request
to give Agent control of such electronic chattel paper under Section 9-105 of
the UCC and control of such transferable record under Section 201 of the Federal
Electronic Signatures in Global and National Commerce Act or, as the case may
be, Section 16 of the Uniform Electronic Transactions Act, as in effect in such
jurisdiction.
          (d) Each Borrower and Guarantor does not have any deposit accounts as
of the date hereof, except as set forth in the Information Certificate.
Borrowers and Guarantors shall not, directly or indirectly, after the date
hereof open, establish or maintain any deposit account unless each of the
following conditions is satisfied: (i) Agent shall have received not less than
five (5) Business Days prior written notice of the intention of any Borrower or
Guarantor to open or establish such account which notice shall specify in
reasonable detail and specificity acceptable to Agent the name of the account,
the owner of the account, the name and address of the bank at which such account
is to be opened or established, the individual at such bank with whom such
Borrower or Guarantor is dealing and the purpose of the account, (ii) the bank
where such account is opened or maintained shall be reasonably acceptable to
Agent, and (iii) on or before the opening of such deposit account, such Borrower
or Guarantor shall as Agent may specify either (x) if such deposit account is a
Concentration Account, (A) deliver to Agent a Deposit Account Control Agreement
with respect to such deposit account duly

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authorized, executed and delivered by such Borrower or Guarantor and the bank at
which such deposit account is opened and maintained or (B) arrange for Agent to
become the customer of the bank with respect to the deposit account on terms and
conditions reasonably acceptable to Agent or (y) if such deposit account is a
Cash Management Account, a direction letter in form and substance reasonably
satisfactory to Agent. The terms of this subsection (d), including, without
limitation, clause (iii) shall not apply to deposit accounts (1) specifically
and exclusively used for payroll, payroll taxes and other employee wage and
benefit payments to or for the benefit of any Borrower’s or Guarantor’s salaried
employees and (2) holding such aggregate amounts as are permitted hereunder
pursuant to Section 6.6(b) hereof.
          (e) No Borrower or Guarantor owns or holds, directly or indirectly,
beneficially or as record owner or both, any investment property, as of the date
hereof, or have any investment account, securities account, commodity account or
other similar account with any bank or other financial institution or other
securities intermediary or commodity intermediary as of the date hereof, in each
case except as set forth in the Information Certificate.
               (i) In the event that any Borrower or Guarantor shall be entitled
to or shall at any time after the date hereof hold or acquire any certificated
securities, such Borrower or Guarantor shall promptly endorse, assign and
deliver the same to Agent, accompanied by such instruments of transfer or
assignment duly executed in blank as Agent may from time to time specify. If any
securities, now or hereafter acquired by any Borrower or Guarantor are
uncertificated and are issued to such Borrower or Guarantor or its nominee
directly by Issuing Bank, such Borrower or Guarantor shall immediately notify
Agent thereof and shall as Agent may specify, either (A) cause Issuing Bank to
agree to comply with instructions from Agent as to such securities, without
further consent of any Borrower or Guarantor or such nominee, or (B) arrange for
Agent to become the registered owner of the securities.
               (ii) Borrowers and Guarantors shall not, directly or indirectly,
after the date hereof open, establish or maintain any investment account,
securities account, commodity account or any other similar account (other than a
deposit account) with any securities intermediary or commodity intermediary
unless each of the following conditions is satisfied: (A) Agent shall have
received not less than five (5) Business Days prior written notice of the
intention of such Borrower or Guarantor to open or establish such account which
notice shall specify in reasonable detail the name of the account, the owner of
the account, the name and address of the securities intermediary or commodity
intermediary at which such account is to be opened or established, the
individual at such intermediary with whom such Borrower or Guarantor is dealing
and the purpose of the account, (B) the securities intermediary or commodity
intermediary (as the case may be) where such account is opened or maintained
shall be reasonably acceptable to Agent, and (C) on or before the opening of
such investment account, securities account or other similar account with a
securities intermediary or commodity intermediary, such Borrower or Guarantor
shall as Agent may specify either (1) execute and deliver, and cause to be
executed and delivered to Agent, an Investment Property Control Agreement with
respect thereto duly authorized, executed and delivered by such Borrower or
Guarantor and such securities intermediary or commodity intermediary or
(2) arrange for Agent to become the entitlement holder with respect to such
investment property on terms and conditions reasonably acceptable to Agent.
          (f) Borrowers and Guarantors are not the beneficiary or otherwise
entitled to any right to payment under any letter of credit, banker’s acceptance
or similar instrument as of the date hereof, except as set forth in the
Information Certificate. In the event that any Borrower or Guarantor shall be
entitled to or shall receive any right to payment under any letter of credit,
banker’s acceptance or any similar instrument, whether as beneficiary thereof or
otherwise after the date hereof, such Borrower or Guarantor shall promptly
notify Agent thereof in writing. Such Borrower or Guarantor shall promptly, as
Agent may specify, either (i) deliver, or cause to be delivered to Agent, with
respect to any such letter of credit,

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banker’s acceptance or similar instrument, the written agreement of Issuing Bank
and any other nominated person obligated to make any payment in respect thereof
(including any confirming or negotiating bank), in form and substance reasonably
satisfactory to Agent, consenting to the assignment of the proceeds of the
letter of credit to Agent by such Borrower or Guarantor and agreeing to make all
payments thereon directly to Agent or as Agent may otherwise direct or
(ii) cause Agent to become, at Borrowers’ expense, the transferee beneficiary of
the letter of credit, banker’s acceptance or similar instrument (as the case may
be).
          (g) Borrowers and Guarantors do not have any commercial tort claims as
of the date hereof in excess of $100,000 or $250,000 in the aggregate, except as
set forth in the Information Certificate. In the event that any Borrower or
Guarantor shall at any time after the date hereof have any commercial tort
claims, such Borrower or Guarantor shall promptly notify Agent thereof in
writing, which notice shall (i) set forth in reasonable detail the basis for and
nature of such commercial tort claim and (ii) include the express grant by such
Borrower or Guarantor to Agent of a security interest in such commercial tort
claim (and the proceeds thereof). In the event that such notice does not include
such grant of a security interest, the sending thereof by such Borrower or
Guarantor to Agent shall be deemed to constitute such grant to Agent. Upon the
sending of such notice, any commercial tort claim described therein shall
constitute part of the Collateral and shall be deemed included therein. Without
limiting the authorization of Agent provided in Section 5.2(a) hereof or
otherwise arising by the execution by such Borrower or Guarantor of this
Agreement or any of the other Loan Documents, Agent is hereby irrevocably
authorized from time to time and at any time to file such financing statements
naming Agent or its designee as secured party and such Borrower or Guarantor as
debtor, or any amendments to any financing statements, covering any such
commercial tort claim as Collateral. In addition, each Borrower and Guarantor
shall promptly upon Agent’s request, execute and deliver, or cause to be
executed and delivered, to Agent such other agreements, documents and
instruments as Agent may reasonably require in connection with such commercial
tort claim.
          (h) Borrowers and Guarantors do not have any goods, documents of title
or other Collateral in the custody, control or possession of a third party as of
the date hereof, except as set forth in the Information Certificate and except
for goods located in the United States or Canada in transit to a location of a
Borrower or Guarantor permitted herein in the ordinary course of business of
such Borrower or Guarantor in the possession of the carrier transporting such
goods. In the event that any goods, documents of title or other Collateral are
at any time after the date hereof in the custody, control or possession of any
other person not referred to in the Information Certificate or such carriers,
Borrowers and Guarantors shall promptly notify Agent thereof in writing.
Promptly upon Agent’s request, Borrowers and Guarantors shall use their
commercially reasonable efforts to deliver to Agent a Collateral Access
Agreement duly authorized, executed and delivered by such person and the
Borrower or Guarantor that is the owner of such Collateral.
          (i) Borrowers and Guarantors shall take any other actions reasonably
requested by Agent from time to time to cause the attachment, perfection and
first priority of, and the ability of Agent to enforce, the security interest of
Agent in any and all of the Collateral, including, without limitation,
(i) executing, delivering and, where appropriate, filing financing statements
and amendments relating thereto under the UCC, the PPSA or other applicable law,
to the extent, if any, that any Borrower’s or Guarantor’s signature thereon is
required therefor, (ii) causing Agent’s name to be noted as secured party on any
certificate of title for a titled good if such notation is a condition to
attachment, perfection or priority of, or ability of Agent to enforce, the
security interest of Agent in such Collateral, (iii) complying with any
provision of any statute, regulation or treaty of the United States or Canada as
to any Collateral if compliance with such provision is a condition to
attachment, perfection or priority of, or ability of Agent to enforce, the
security interest of Agent in such Collateral, (iv) obtaining the consents and
approvals of any Governmental Authority or third party, including, without
limitation, any consent of any licensor, lessor or other person obligated on
Collateral, and taking all actions required by any earlier versions of the UCC,
the PPSA or by other law, as applicable in any relevant jurisdiction.

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     5.3 Special Provisions Relating to Collateral.
          (a) The grant of a security interest in the Collateral of each
Canadian Loan Party in favor of Agent under the laws of Canada and the Provinces
thereof is further evidenced by other Loan Documents and subject to the terms of
the other Loan Documents.
          (b) Notwithstanding anything to the contrary contained in this
Agreement or the other Loan Documents to the contrary, (i) Canadian Borrowers
and Canadian Guarantors (whether as guarantor or otherwise) shall not be liable
in respect of any US Obligations except as otherwise agreed by Agent and such
Canadian Loan Party, (ii) no security interest granted by any Canadian Borrower
or Canadian Loan Party under any of the Loan Documents shall secure any US
Obligations, (iii) all amounts received by Agent or any Lender on account of the
Canadian Obligations by any Canadian Borrower or Canadian Guarantor shall be
applied or credited solely to the Canadian Obligations, and (iv) the liability
or obligation of any Canadian Loan Party with respect to the Obligations shall
not exceed that portion of the Obligations which is attributable only to the
Canadian Borrowers, the Canadian Obligations, their Collateral, the Canadian
Dollar Loans, the Canadian Commitments or the Canadian Letter of Credit
Obligations (as the case may be) or such other greater amount as may be agreed
to in writing by Agent and the Canadian Borrowers.
          (c) Notwithstanding anything to the contrary contained in this
Section 5, the types or items of Collateral (A) described in Section 5.1 hereof
shall not include any rights or interest in any lease, contract, license or
license agreement covering personal or real property of any Borrower or
Guarantor, so long as under the terms of such lease, contract, license or
license agreement, or applicable law with respect thereto, the grant of a
security interest or lien therein to Agent is prohibited (or would render such
lease, contract, license or license agreement cancelled, invalid or
unenforceable) and such prohibition has not been or is not waived or the consent
of the other party to such lease, contract, license or license agreement has not
been or is not otherwise obtained; provided, that, the foregoing exclusion shall
in no way be construed (1) to apply if any such prohibition is unenforceable
under the UCC, the PPSA or other applicable law or (2) so as to limit, impair or
otherwise affect Agent’s unconditional continuing security interests in and
liens upon any rights or interests of Borrowers or Guarantors in or to monies
due or to become due to a Borrower or Guarantor under any such lease, contract,
license or license agreement (including any Receivables) and (B) to secure
obligations of US Borrowers shall not include shares of any direct or indirect
Subsidiary of Parent that is a “controlled foreign corporation” (a “Foreign
Subsidiary”) in excess of sixty-five (65%) percent of all of the issued and
outstanding Equity Interests in such Subsidiary entitled to vote (within the
meaning of Treasury Regulation Section 1.956-2) (all such property not included
in the Collateral, “Excluded Collateral”. Notwithstanding anything to the
contrary contained herein, any individual parcel of owned Real Property of a
Borrower or Guarantor having an appraised fair market value of less than the US
Dollar Equivalent of US$2,000,000 shall not be subject to a mortgage in favor of
Agent; provided, that, the aggregate amount of the appraised fair market of all
such parcels that are not subject to mortgages shall not exceed the US Dollar
Equivalent of US$5,000,000.
SECTION 6. COLLECTION AND ADMINISTRATION
     6.1 Borrowers’ Loan Accounts. Agent shall maintain one or more loan
account(s) on its books in which shall be recorded (a) all Loans, Letters of
Credit and other Obligations and the Collateral, (b) all payments made by or on
behalf of any Borrower or Guarantor and (c) all other appropriate debits and
credits as provided in this Agreement, including fees, charges, costs, expenses
and interest. All entries in the loan account(s) shall be made in accordance
with Agent’s customary practices as in effect from time to time.

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     6.2 Statements. Agent shall render to Administrative Borrower each month a
statement setting forth the balance in the Borrowers’ loan account(s) maintained
by Agent for Borrowers pursuant to the provisions of this Agreement, including
principal, interest, fees, costs and expenses. Each such statement shall be
subject to subsequent adjustment by Agent but shall, absent manifest errors or
omissions, be considered correct and deemed accepted by Borrowers and Guarantors
and conclusively binding upon Borrowers and Guarantors as an account stated
except to the extent that Agent receives a written notice from Administrative
Borrower of any specific exceptions of Administrative Borrower thereto within
thirty (30) days after the date such statement has been received by Parent.
Until such time as Agent shall have rendered to Administrative Borrower a
written statement as provided above, the balance in any Borrower’s loan
account(s) shall be presumptive evidence of the amounts due and owing to Agent
and Lenders by Borrowers and Guarantors, absent manifest error.
     6.3 Lenders’ Evidence of Debt. Each Lender shall maintain in accordance
with its usual practice an account or accounts evidencing the Obligations of
each Borrower to such Lender, including the amounts of the Loans made by it and
each repayment and prepayment in respect thereof, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder. Any such records shall be presumptively correct, absent manifest
error; provided, that, the failure to make any entry or any error in such
records, shall not affect any Lender’s Commitments hereunder or the Obligations
in respect of any applicable Loans and in the event of any inconsistency between
the Register and any Lender’s records, the Register shall govern.
     6.4 Register.
          (a) Agent (or its agent or sub-agent appointed by it) shall maintain a
register (the “Register”) for the recordation of the names and addresses of
Lenders and the Commitments of, and principal amount of the Loans (the
“Registered Loans”) and Letter of Credit Obligations owing to each Lender from
time to time. The Register, as in effect at the close of business on the
preceding Business Day, shall be available for inspection by Administrative
Borrower or any Lender (with respect to a Lender, solely with respect to the
Obligations owing to such Lender) at a reasonable time and from time to time
upon reasonable prior notice. Agent shall record, or cause to be recorded, in
the Register, the Commitments and the Loans in accordance with the provisions of
Section 15.7 and Agent shall also maintain a copy of each Assignment and
Acceptance delivered to and accepted by it and shall modify the Register to give
effect to each Assignment and Acceptance, and any such recording shall be
presumptively correct, absent manifest error; provided, that, the failure to
make any entry or any error in such records, shall not affect any Lender’s
Commitments or Obligations in respect of any Loan. Borrowers, Guarantors, Agent
and Lenders shall treat each Person whose name is recorded in the Register as a
Lender hereunder for all purposes of this Agreement. Borrowers hereby designate
and authorize Agent, and Agent agrees, to maintain, or cause to be maintained as
agent for Borrowers’ solely for purposes of maintaining the Register as provided
in this Section 6.4(a).
          (b) Each Lender that grants a participation shall maintain a register
as a non-fiduciary agent of Borrowers on which it enters the name and address of
each Participant and the principal and interest amount of each Participant’s
interest in the Loans and Letters of Credit held by it (the “Participant
Register”). The entries in the Participant Register shall be conclusive, absent
manifest error, and such Lender shall treat each person whose name is recorded
in the Participant Register as the owner of such participation for all purposes
of this Agreement notwithstanding any notice to the contrary.

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     6.5 Promissory Notes. Each Lender may at any time request that the Loans
made by it be evidenced by a promissory note. In such event, Borrowers shall
execute and deliver to such Lender a promissory note payable to the order of
such Lender (or, if requested by such Lender, to such Lender and its registered
assigns) in a form furnished by Agent and reasonably acceptable to
Administrative Borrower. Thereafter, the Loans evidenced by such promissory note
and interest thereon shall at all times (including after assignment pursuant to
Section 15.7) be represented by one or more promissory notes in such form
payable to the order of the payee named therein.
     6.6 Cash Management; Collection of Proceeds of Collateral.
          (a) Each Borrower and Guarantor shall establish and maintain, at its
expense, deposit accounts and cash management services of a type and on terms,
and with the banks, set forth on Schedule 8.10 to the Information Certificate
and, subject to Section 5.2(d) hereof, such other banks as such Borrower or
Guarantor may hereafter select. The banks set forth on Schedule 8.10 of the
Information Certificate constitute all of the banks with which Borrowers and
Guarantors have deposit account and cash management arrangements as of the date
hereof and identifies each of the deposit accounts at such banks that are used
for receiving receipts from particular locations of a Borrower or otherwise
describes the nature of the use of such deposit account by such Borrower or
Guarantor (collectively, the “Cash Management Accounts” and individually a “Cash
Management Account”). Borrowers and Guarantors shall deliver, or cause to be
delivered to Agent, a direction letter in form and substance reasonably
satisfactory to Agent with respect to each Cash Management Account, and a
Deposit Account Control Agreement duly authorized, executed and delivered by
each bank where a Concentration Account is maintained and by the applicable
Borrower or Guarantor; provided, that, Borrowers and Guarantors shall not be
required to deliver a Deposit Account Control Agreement with a depository bank
as to any deposit account that is specifically and exclusively used for payroll,
payroll taxes and other employee wage and benefit payments to or for the benefit
of any Borrower’s or Guarantor’s employees.
          (b) Each Borrower shall deposit or cause to be deposited all proceeds
of Collateral, including all proceeds from sales of Inventory, all amounts
payable to each Borrower and Guarantor and all other proceeds of Collateral,
from each location of such Borrower on each Business Day into the Cash
Management Account of such Borrower used for such purpose. All such funds
deposited into the Cash Management Accounts shall be sent by wire transfer or
other electronic funds transfer no less frequently than twice each week (or more
frequently upon Agent’s request at any time that a Cash Dominion Event exists)
to the Concentration Accounts, except nominal amounts which are required to be
maintained in such Cash Management Accounts under the terms of such Borrower’s
arrangements with the bank at which such Cash Management Accounts are
maintained, which nominal amounts shall not exceed $10,000 as to any individual
Cash Management Account at any time, or $20,000 as to any such Cash Management
Account listed on Schedule 6.6(b).
          (c) Without limiting any other rights or remedies of Agent or Lenders,
Agent may, at its option, instruct the depository banks at which the
Concentration Accounts are maintained to transfer all available funds received
or deposited into the Concentration Accounts to the US Payment Account or
Canadian Payment Account (as the case may be) at any time that a Cash Dominion
Event exists. At all times that Agent shall have notified any depository bank to
transfer funds from a Concentration Account to the US Payment Account or
Canadian Payment Account (as the case may be), all payments made to such
Concentration Accounts, whether in respect of the Receivables, as proceeds of
Inventory or other Collateral or otherwise shall be treated as payments to Agent
in respect of the Obligations and therefore shall constitute the property of
Agent and Lenders to the extent of the then outstanding Obligations. Agent
shall, at the request of Administrative Borrower, rescind such Control Notice at
such time that a Cash Dominion Event does not exist for a period of not less
sixty (60) consecutive days (a “Control Rescission”); provided, that, if two (2)
Control Rescissions shall have occurred in any period of twelve

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(12) consecutive calendar months, then any immediately subsequent Control
Rescission shall only be available to Borrowers if Global Excess Availability
exceeds twenty-five (25%) percent of the Maximum Credit and no Default or Event
of Default exists or has occurred and is continuing (and thereafter, only at the
request of Administrative Borrower, at such time that a Cash Dominion Event does
not exist for a period of not less sixty (60) consecutive days, in accordance
with this Section 6.6(c)). Borrower and each Guarantor agrees that all payments
and funds received and collected by Agent or any Lender, whether in respect of
the Receivables, as proceeds of Inventory or other Collateral or otherwise shall
be treated as payments to Agent and Lenders in respect of the Obligations and
therefore shall constitute the property of Agent and Lenders to the extent of
the then outstanding Obligations.
          (d) For purposes of calculating the amount of the Loans available to
each Borrower, such payments will be applied (conditional upon final collection)
to the Obligations on the Business Day of receipt by Agent of immediately
available funds in the US Payment Account and Canadian Payment Account provided
such payments and notice thereof are received in accordance with Agent’s usual
and customary practices as in effect from time to time and within sufficient
time to credit the applicable loan account on such day, and if not, then on the
next Business Day.
          (e) Each Borrower and Guarantor and their respective employees, agents
and Subsidiaries shall, acting as trustee for Agent, receive, as the property of
Agent, any monies, checks, notes, drafts or any other payment relating to and/or
proceeds of Accounts or other Collateral which come into their possession or
under their control and promptly upon receipt thereof, shall deposit or cause
the same to be deposited in the Concentration Accounts, or remit the same or
cause the same to be remitted, in kind, to Agent. In no event shall the same be
commingled with any Borrower’s or Guarantor’s own funds. Borrowers agree to
reimburse Agent on demand for any amounts owed or paid to any bank or other
financial institution at which a Concentration Account or any other deposit
account or investment account is established or any other bank, financial
institution or other person involved in the transfer of funds to or from the
Concentration Accounts arising out of Agent’s payments to or indemnification of
such bank, financial institution or other person. The obligations of Borrowers
to reimburse Agent for such amounts pursuant to this Section 6.6 shall survive
the termination of this Agreement.
     6.7 Payments.
          (a) All Obligations of US Borrowers and Guarantors shall be payable to
the US Payment Account and all Obligations of Canadian Borrowers shall be
payable to the Canadian Payment Account. Agent shall apply payments received or
collected from any US Borrower or US Guarantor or for the account of any US
Borrower or US Guarantor (including the monetary proceeds of collections or of
realization upon any US Collateral) as follows: first, to pay any fees,
indemnities or expense reimbursements then due to Agent from any US Borrower or
US Guarantor; second, to pay any fees, indemnities, or expense reimbursements
then due to Lenders and the applicable Issuing Bank from any US Borrower or US
Guarantor; third, to pay interest due in respect of any US Loans (and including
any Special Agent Advances); fourth, to pay principal in respect of Special
Agent Advances; fifth, to pay principal in respect of all US Loans and to pay or
prepay US Obligations then due arising under or pursuant to any Hedge Agreements
of a US Borrower or US Guarantor with a Bank Product Provider (up to the amount
of any then effective US Reserve established in respect of such US Obligations),
on a pro rata basis; sixth, to pay or prepay any other US Obligations whether or
not then due, in such order and manner as Agent determines or to be held as cash
collateral in connection with any Letter of Credit Obligations or other
contingent US Obligations (including any such Obligations arising under or
pursuant to any Bank Products) on a pro rata basis; and seventh, to pay any of
the Canadian Obligations. Notwithstanding anything to the contrary contained in
this Agreement, (i) unless so directed by Agent, or unless an Event of Default
shall exist or have occurred and be continuing, Agent shall not apply any
payments which it receives to any Eurodollar Rate Loans, except (A) on the
expiration date of the Interest

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Period applicable to any such Eurodollar Rate Loans or (B) in the event that
there are no outstanding US Base Rate Loans and (ii) to the extent any US
Borrower uses any proceeds of the US Loans or Letters of Credit to acquire
rights in or the use of any US Collateral or to repay any Indebtedness used to
acquire rights in or the use of any US Collateral, payments in respect of the
Obligations shall be deemed applied first to the Obligations arising from US
Loans and Letter of Credit Obligations that were not used for such purposes, and
second, to the US Obligations arising from US Loans and Letter of Credit
Obligations the proceeds of which were used to acquire rights in or the use of
any US Collateral in the chronological order in which such US Borrower acquired
such rights in or the use of such US Collateral.
          (b) Agent shall apply payments received or collected from Canadian
Borrower or any Guarantor of the Canadian Obligations (including any payments
made by US Borrowers and Guarantors pursuant to the guarantee of any Canadian
Guarantor) or for the account of Canadian Borrowers or any Canadian Guarantor of
the Canadian Obligations (including the monetary proceeds of collections or of
realization upon any US Collateral) as follows: first, to pay any fees,
indemnities or expense reimbursements then due to Agent from Canadian Borrowers;
second, to pay any fees, indemnities, or expense reimbursements then due to
Canadian Lenders and the applicable Issuing Bank from any Canadian Borrower or
Canadian Guarantor; third, to pay interest due in respect of any Canadian
Obligations (and including any Special Agent Advances); fourth, to pay principal
in respect of Canadian Special Agent Advances; fifth, to pay principal then due
in respect of the Canadian Obligations and to pay or prepay Canadian Loans and
Canadian Obligations arising under or pursuant to any Hedge Agreements of
Canadian Borrowers with a Bank Product Provider (up to the amount of any then
effective Reserve established in respect of such Canadian Obligations), on a pro
rata basis; and sixth, to pay or prepay any other Canadian Obligations, whether
or not then due, in such order and manner as Agent determines or to be held as
cash collateral in connection with any Letter of Credit Obligations or other
contingent Canadian Obligations (including any such Obligations arising under or
pursuant to any Bank Products) on a pro rata basis. Notwithstanding anything to
the contrary contained in this Agreement, (i) unless so directed by Agent, or
unless a Default or an Event of Default shall exist or have occurred and be
continuing, Agent shall not apply any payments which it receives to any
Eurodollar Rate Loans incurred by Canadian Borrowers, except (A) on the
expiration date of the Interest Period applicable to any such Eurodollar Rate
Loans incurred by Canadian Borrowers or (B) in the event that there are no
outstanding US Base Rate Loans or Canadian Base Rate Loans owing by Canadian
Borrowers and (ii) to the extent any Canadian Borrower uses any proceeds of the
Loans to acquire rights in or the use of any Canadian Collateral or to repay any
Indebtedness used to acquire rights in or the use of any Canadian Collateral,
payments in respect of the Canadian Obligations shall be deemed applied first to
the Canadian Obligations arising from the Loans or Letters of Credit that were
not used for such purposes and second, to the Canadian Obligations arising from
Loans and Letters of Credit the proceeds of which were used to acquire rights in
or the use of any Canadian Collateral in the chronological order in which
Canadian Borrowers acquired such rights in or the use of such Canadian
Collateral.
          (c) Notwithstanding anything to the contrary set forth in any of the
Loan Documents, (i) all payments by or on behalf of Canadian Borrowers and
Canadian Guarantors shall be applied only to the Canadian Obligations, (ii) all
payments on behalf of a US Borrower or Guarantor shall be applied first to US
Obligations then due until paid in full, (iii) all payments in respect of the
Canadian Obligations shall be applied first to Canadian Obligations denominated
in the same currency as the payments received; provided, that, with respect to
this clause (iii), (A) payments and collections received in any currency other
than the currency in which any outstanding Obligations are denominated will be
accepted and/or applied at the discretion of the applicable Agent, (B) in the
event that any Agent elects to accept and apply such amounts when there are no
Obligations (other than Letter of Credit Obligations or other contingent
Obligations) then outstanding in the same currency, such Agent may, at its
option (but is not obligated to), convert such currency received to the currency
in which the Obligations are denominated at the Exchange Rate on such date
(regardless of whether such rate is the best available rate) and (C) in such

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event, Borrowers shall pay the costs of such conversion (or such Agent may, at
its option, charge such costs to the loan account of any Borrower maintained by
such Agent) and (iv) to the extent any Borrower or Guarantor, directly or
indirectly, uses any proceeds of the applicable Loans or Letter of Credit
Obligations to acquire rights in or the use of any Collateral or to repay any
Indebtedness used to acquire rights in or the use of any Collateral, payments in
respect of the Obligations shall be deemed applied first to the Obligations
arising from Loans and Letter of Credit Obligations that were not used for such
purposes and second to the Obligations arising from Loans and Letter of Credit
Obligations the proceeds of which were used to acquire rights in or the use of
any Collateral in the chronological order in which such Borrower acquired such
rights in or the use of such Collateral.
          (d) Notwithstanding anything to the contrary contained in this
Agreement, unless so directed by Administrative Borrower, or unless a Default or
an Event of Default shall exist or have occurred and be continuing, Agent shall
not apply any payments which it receives to any Eurodollar Rate Loans, except
(i) on the expiration date of the Interest Period applicable to any such
Eurodollar Rate Loans or (ii) in the event that there are no outstanding US Base
Rate Loans; provided, however, that Agent will attempt to honor any written
request received from Administrative Borrower to hold such payment until the
expiration of the applicable Interest Period, it being understood and agreed
that Agent shall have no liability for any failure to do so. To the extent Agent
or any Lender receives any payments or collections in respect of the Obligations
in a currency other than US Dollars, or in respect of the Canadian Obligations,
in a currency other than Canadian Dollars, each of Agent and Wachovia Canada
may, at its option (but is not obligated to), convert such other currency to US
Dollars (and, as to the Canadian Obligations, Canadian Dollars) at the Exchange
Rate on such date and in such market as Agent or Wachovia Canada may select
(regardless of whether such rate is the best available rate). US Borrowers shall
pay the costs of such conversion (or Agent may, at its option, charge such costs
to the loan account of any US Borrower maintained by Agent). Payments and
collections received in any currency other than the currency in which any
outstanding Obligations are denominated will be accepted and/or applied at the
discretion of Agent and Wachovia Canada. Any and all payments by or on account
of the Obligations shall be made without setoff, counterclaim or deduction.
          (e) For purposes of this Section 6.7, “Paid in full” and “payment in
full” and “prepayment in full” means payment of all amounts owing under the Loan
Documents according to the terms thereof, including loan fees, service fees,
professional fees, interest (and specially including interest accrued after the
commencement of any case under the United States Bankruptcy Code or any similar
domestic or foreign similar statute), default interest, interest on interest,
and expense reimbursements, whether or not the same would be or is allowed or
disallowed in whole or in part in any case under the United States Bankruptcy
Code, the Bankruptcy and Insolvency Act (Canada), the Companies’ Creditors
Arrangement Act (Canada) or any similar statute in any jurisdiction, but
excluding (i) interest to the extent paid in excess of amounts based on the
pre-default rates (but not any other interest) and (ii) fees paid in respect of
the waiver of an Event of Default, in each case as to amounts under clauses
(i) and (ii) above only to the extent that such amounts are disallowed in any
case under the United States Bankruptcy Code, the Bankruptcy and Insolvency Act
(Canada), the Companies’ Creditors Arrangement Act (Canada) or any similar
statute in any jurisdiction.
          (f) At Agent’s option, all principal, interest, fees, costs, expenses
and other charges provided for in this Agreement or the other Loan Documents may
be charged directly to the loan account(s) of any Borrower maintained by Agent.
If after receipt of any payment of, or proceeds of Collateral applied to the
payment of, any of the Obligations, Agent, any Lender or Issuing Bank is
required to surrender or return such payment or proceeds to any Person for any
reason, then the Obligations intended to be satisfied by such payment or
proceeds shall be reinstated and continue and this Agreement shall continue in
full force and effect as if such payment or proceeds had not been received by
Agent or such Lender. Borrowers and Guarantors shall be liable to pay to Agent,
and do hereby agree to

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indemnify and hold Agent and Lenders harmless for the amount of any payments or
proceeds surrendered or returned. This Section 6.7(d) shall remain effective
notwithstanding any contrary action which may be taken by Agent or any Lender in
reliance upon such payment or proceeds. This preceding two sentences of this
Section 6.7(d) shall survive the payment of the Obligations and the termination
of this Agreement.
     6.8 Taxes.
          (a) Any and all payments by Borrowers and Guarantors to Agent, any
Issuing Bank or any Lender under this Agreement and any of the other Loan
Documents shall be made free and clear of, and without deduction or withholding
for, any Taxes, except to the extent required by applicable law. In addition,
Borrowers shall pay all Other Taxes (or Agent may, at its option, pay such Other
Taxes and charge the loan account of Borrowers for such amounts so paid).
          (b) Borrowers and Guarantors shall indemnify and hold harmless Agent,
Issuing Bank and Lenders for the full amount of Taxes or Other Taxes paid by
Agent, any Issuing Bank or any Lender (including any Taxes or Other Taxes
imposed by any jurisdiction on amounts payable under this Section, but not
including Other Taxes that arise as a result of Agent’s, any Issuing Bank’s or
any Lender’s activities with the applicable taxing jurisdiction, if any, and not
as a result of this Agreement) and any liability (including penalties, interest
and expenses (including reasonable attorney’s fees and expenses) other than
those resulting solely from a failure by Agent, any Issuing Bank or any Lender
to pay any Taxes or Other Taxes which it is required to pay and for which it
received an indemnity payment) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted by
the relevant Governmental Authority; provided, that, Borrowers and Guarantors
shall not be required to indemnify Agent, any Issuing Bank or any Lender with
respect to any Taxes or Other Taxes which are attributable to such Agent’s,
Issuing Bank’s or Lender’s failure to comply with the provisions of
Section 6.8(f), (g), (i) or (j) hereof. Payment under this indemnification shall
be made within ten (10) days after the date Agent, any Issuing Bank or any
Lender makes written demand therefor on Administrative Borrower. If Borrowers
reasonably believe that such Taxes or Other Taxes were not correctly or legally
asserted, Agent, such Issuing Bank or such Lender shall, upon Administrative
Borrower’s request and at Borrowers’ expense, provide such documents to
Administrative Borrower in form and substance reasonably satisfactory to Agent,
as Administrative Borrower may reasonably request, to enable Borrowers to
contest such Taxes or Other Taxes pursuant to appropriate proceedings then
available to Borrowers (so long as providing such documents shall not, in the
good faith determination of Agent, have a reasonable likelihood of resulting in
any liability of Agent, any Issuing Bank or any Lender).
          (c) If any Borrower or Guarantor shall be required by law to deduct or
withhold any Taxes or Other Taxes from or in respect of any sum payable
hereunder or under the other Loan Documents to Agent, any Issuing Bank or any
Lender, then:
               (i) the sum payable shall be increased as necessary so that after
making all required deductions and withholdings (including deductions and
withholdings applicable to additional sums payable under this Section) Agent,
such Issuing Bank or such Lender receives an amount equal to the sum it would
have received had no such deductions or withholdings been made; provided, that,
Borrowers and Guarantors shall not be required to increase any such sum payable
to Agent, any Issuing Bank or any Lender which is attributable to such Agent’s,
Issuing Bank’s or Lender’s failure to comply with the provisions of
Section 6.8(f), (g), (i) or (j) hereof;
               (ii) such Borrower or Guarantor shall make such deductions and
withholdings;

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               (iii) such Borrower or Guarantor shall pay the full amount
deducted or withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
               (iv) to the extent not paid to Agent, Issuing Bank or Lenders
pursuant to Section 6.8(c)(i), such Borrower or Guarantor shall also pay to
Agent, any Issuing Bank or any Lender, at the time interest is paid, all
additional amounts which are necessary to preserve the after-tax yield Agent,
such Issuing Bank or such Lender would have received pursuant to the Loan
Documents if such Taxes or Other Taxes had not been imposed.
          (d) Within thirty (30) days after the date of any payment by any
Borrower or Guarantor of Taxes or Other Taxes, such Borrower or Guarantor shall
furnish to Agent the original or a certified copy of a receipt evidencing
payment thereof, or other evidence of payment reasonably satisfactory to Agent
upon Agent’s request.
          (e) If any Borrower or Guarantor otherwise would be required to pay
additional amounts to Agent, an Issuing Bank or a Lender pursuant to subsection
(c) of this Section, then upon Administrative Borrower’s written request such
Lender shall use reasonable efforts at Borrowers’ expense (consistent with legal
and regulatory restrictions) to take such action, including changing the
jurisdiction of its lending office, so as to eliminate or reduce any such
additional payment by such Borrower or Guarantor which may thereafter accrue.
          (f) In the event a US Lender shall assign the Obligations and its
rights hereunder to an assignee which is organized under the laws of a
jurisdiction outside the United States of America on or prior to the effective
date of any such assignment, such assignee of a Lender shall provide
Administrative Borrower with an IRS Form W-8BEN or Form W-8ECI or other
applicable form, certificate or document prescribed by the Internal Revenue
Service certifying as to such assignee’s being entitled to full exemption from
United States of America withholding tax with respect to all payments to be made
by the US Loan Parties to such assignee hereunder and under any of the other
Loan Documents (unless such assignee of a Lender is unable to do so by reason of
a change in law, including, without limitation, any statute, treaty, ruling,
determination or regulation occurring subsequent to the effective date of such
assignment).
          (g) Notwithstanding anything to the contrary contained in this
Section 6.8, unless Administrative Borrower has received forms or other
documents indicating that payments by the US Loan Parties to a US Lender or US
Issuing Bank hereunder or under any of the other Loan Documents are not subject
to United States of America withholding or backup withholding tax, US Borrowers
shall, (i) withhold taxes from such payments at the applicable statutory rate,
or at a rate reduced by an applicable tax treaty and (ii) pay such assignee such
payment net of any taxes so withheld. Such US Lender or US Issuing Bank will be
required to use reasonable efforts (including reasonable efforts to change its
lending office) to avoid or to minimize any amounts which might otherwise be
payable by any Borrower or Guarantor pursuant to this Section 6.8; provided,
that, such efforts shall not cause the imposition on such assignee of any
additional costs or legal or regulatory burdens deemed by such assignee in good
faith to be material.
          (h) If Agent, any Issuing Bank or any Lender receives a permanent tax
benefit in respect of any Taxes or Other Taxes for which Agent, such Issuing
Bank or such Lender has received an indemnification payment or additional
amounts from any Borrower or Guarantor hereunder, so long as no Event of Default
shall exist or have occurred and be continuing, Agent, such Issuing Bank or such
Lender (as the case may be) shall credit to the loan account of Borrowers the
amount of such tax benefit.

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          (i) Each Person that is a US Lender or US Issuing Bank as of the date
of this Agreement and each Person that becomes a US Lender or US Issuing Bank
after the date of this Agreement (i) either (A) represents and warrants to the
Borrowers that such Person is incorporated or organized under the laws of the
United States of America or a state thereof or (B) agrees to furnish (if it is
organized under the laws of any jurisdiction other than the United States of
America or any State thereof) to Agent and Administrative Borrower prior to the
time that Agent or such Borrower is required to make any payment of principal,
interest or fees hereunder, duplicate executed originals of either U.S. Internal
Revenue Service Form W-8BEN or W-8ECI, as applicable (wherein such Lender claims
entitlement to the benefits of a tax treaty that provides for a complete
exemption from U.S. federal income withholding tax on all payments hereunder)
and agrees to provide new such forms upon the expiration of any previously
delivered form or comparable statements in accordance with applicable U.S. law
and regulations and amendments thereto, duly executed and completed by such
Lender, and (ii) agrees to comply with all applicable U.S. laws and regulations
with regard to such withholding tax exemption.
          (j) Each US Lender or US Issuing Bank (other than any such US Lender
or US Issuing Bank that is entitled to a presumption under applicable Treasury
Regulations that it is a domestic corporation for U.S. federal income tax
purposes) shall deliver to Agent (or, in the case of an assignee of a US Lender
which (i) is an Affiliate of such US Lender or an Approved Fund of such US
Lender and (ii) does not deliver an Assignment and Acceptance to Agent pursuant
to Section 15.7(a) hereof for recordation pursuant to Section 15.7(b) hereof, to
the assigning US Lender only) and Administrative Borrower two properly completed
and duly executed copies of U.S. Internal Revenue Service Form W-9 certifying
that such US Lender is exempt from U.S. backup withholding tax. Such forms shall
be delivered by each such US Lender on or before the date it becomes a party to
this Agreement and thereafter within twenty (20) days after receipt of a written
request therefor from Agent. Notwithstanding any other provision of this
Section 6.8(j), a US Lender or US Issuing Bank described in this Section 6.8
(j) shall not be required to deliver any form pursuant to this Section 6.8(j)
that such US Lender or US Issuing Bank is not legally able to deliver.
     6.9 Use of Proceeds. Borrowers shall use the initial proceeds of the Loans
and Letters of Credit hereunder only for: (a) payments to each of the persons
listed in the disbursement direction letter furnished by Borrowers to Agent on
or about the date hereof and (b) costs, expenses and fees in connection with the
preparation, negotiation, execution and delivery of this Agreement and the other
Loan Documents. All other Loans made or Letters of Credit provided to or for the
benefit of any Borrower pursuant to the provisions hereof shall be used by such
Borrower for general operating, working capital and other corporate purposes of
such Borrower not otherwise prohibited hereby or by the terms of the
organizational documents of such Borrower or Guarantor; provided, that, in no
event shall any of the proceeds be used, directly or indirectly, for the purpose
of purchasing or carrying any margin security or for the purposes of reducing or
retiring any indebtedness which was originally incurred to purchase or carry any
margin security or for any other purpose which might cause any of the Loans to
be considered a “purpose credit” within the meaning of Regulation U of the Board
of Governors of the Federal Reserve System, as amended.
     6.10 Appointment of Administrative Borrower as Agent for Requesting Loans
and Receipts of Loans and Statements.
          (a) Each Borrower hereby irrevocably appoints and constitutes
Administrative Borrower as its agent and attorney-in-fact to request and receive
Loans and Letters of Credit pursuant to this Agreement and the other Loan
Documents from Agent or any Lender in the name or on behalf of such Borrower.
Agent and Lenders may disburse the Loans to such bank account of Administrative
Borrower or a Borrower or otherwise make such Loans to a Borrower and provide
such Letters of Credit to a Borrower as Administrative Borrower may designate or
direct, without notice to any other Borrower or Guarantor. Notwithstanding
anything to the contrary contained herein, Agent may at any time and from time
to time require that Loans to or for the account of any Borrower be disbursed
directly to an operating account of such Borrower.

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          (b) Administrative Borrower hereby accepts the appointment by
Borrowers to act as the agent and attorney-in-fact of Borrowers pursuant to this
Section 6.10. Administrative Borrower shall ensure that the disbursement of any
Loans to each Borrower requested by or paid to or for the account of Parent, or
the issuance of any Letter of Credit for a Borrower hereunder, shall be paid to
or for the account of such Borrower.
          (c) Each Borrower and other Guarantor hereby irrevocably appoints and
constitutes Administrative Borrower as its agent to receive statements on
account and all other notices from Agent and Lenders with respect to the
Obligations or otherwise under or in connection with this Agreement and the
other Loan Documents.
          (d) Any notice, election, representation, warranty, agreement or
undertaking by or on behalf of any other Borrower or any Guarantor by
Administrative Borrower shall be deemed for all purposes to have been made by
such Borrower or Guarantor, as the case may be, and shall be binding upon and
enforceable against such Borrower or Guarantor to the same extent as if made
directly by such Borrower or Guarantor.
          (e) No termination of the appointment of Administrative Borrower as
agent as aforesaid shall be effective, except after ten (10) Business Days’
prior written notice to Agent.
     6.11 Pro Rata Treatment. Except to the extent otherwise provided in this
Agreement or as otherwise agreed by the applicable Lenders: (a) the making and
conversion of Loans to the US Borrowers shall be made among the US Lenders based
on their respective Pro Rata Shares as to the Loans made to the US Borrowers,
(b) the making and conversion of Loans to the Canadian Borrower shall be made
among the Canadian Lenders based on their respective Pro Rata Shares as to the
Loans made to the Canadian Borrower and (c) each payment on account of any
Obligations or Canadian Obligations, as the case may be, to or for the account
of one or more Lenders in respect of any Obligations or Canadian Obligations, as
the case may be, due on a particular day shall be allocated among the Lenders
entitled to such payments based on their respective Pro Rata Shares and shall be
distributed accordingly.
     6.12 Sharing of Payments, Etc.
          (a) Each Borrower and Guarantor agrees that, in addition to (and
without limitation of) any right of setoff, banker’s lien or counterclaim Agent
or any Lender may otherwise have, each Lender shall be entitled, if an Event of
Default exists or has occurred and is continuing, at its option (but subject, as
among Agent and Lenders, to the provisions of Section 14.3(b) hereof), to offset
balances held by it for the account of such Borrower or Guarantor at any of its
offices, in dollars or in any other currency, against any principal of or
interest on any Loans owed to such Lender or any other amount payable to such
Lender hereunder, that is not paid when due (regardless of whether such balances
are then due to such Borrower or Guarantor), in which case it shall promptly
notify Administrative Borrower and Agent thereof; provided, that, such Lender’s
failure to give such notice shall not affect the validity thereof.
          (b) If any Lender (including Agent) shall obtain from any Borrower or
Guarantor payment of any principal of or interest on any Loan owing to it or
payment of any other amount under this Agreement or any of the other Loan
Documents through the exercise of any right of setoff, banker’s lien or
counterclaim or similar right or otherwise (other than from Agent as provided
herein), and, as a result of such payment, such Lender shall have received more
than its Pro Rata Share of the principal of the

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Loans or more than its share of such other amounts then due hereunder or
thereunder by any Borrower or Guarantor to such Lender than the percentage
thereof received by any other Lender, it shall promptly pay to Agent, for the
benefit of Lenders, the amount of such excess and simultaneously purchase from
such other Lenders a participation in the Loans or such other amounts,
respectively, owing to such other Lenders (or such interest due thereon, as the
case may be) in such amounts, and make such other adjustments from time to time
as shall be equitable, to the end that all Lenders shall share the benefit of
such excess payment (net of any expenses that may be incurred by such Lender in
obtaining or preserving such excess payment) in accordance with their respective
Pro Rata Shares or as otherwise agreed by Lenders. To such end all Lenders shall
make appropriate adjustments among themselves (by the resale of participation
sold or otherwise) if such payment is rescinded or must otherwise be restored.
          (c) Each Borrower and Guarantor agrees that any Lender purchasing a
participation (or direct interest) as provided in this Section may exercise, in
a manner consistent with this Section, all rights of setoff, banker’s lien,
counterclaim or similar rights with respect to such participation as fully as if
such Lender were a direct holder of Loans or other amounts (as the case may be)
owing to such Lender in the amount of such participation.
          (d) Nothing contained herein shall require any Lender to exercise any
right of setoff, banker’s lien, counterclaims or similar rights or shall affect
the right of any Lender to exercise, and retain the benefits of exercising, any
such right with respect to any other Indebtedness or obligation of any Borrower
or Guarantor. If, under any applicable bankruptcy, insolvency or other similar
law, any Lender receives a secured claim in lieu of a setoff to which this
Section applies, such Lender shall, to the extent practicable, assign such
rights to Agent for the benefit of Lenders and, in any event, exercise its
rights in respect of such secured claim in a manner consistent with the rights
of Lenders entitled under this Section to share in the benefits of any recovery
on such secured claim.
     6.13 Settlement Procedures.
          (a) In order to administer the Credit Facility in an efficient manner
and to minimize the transfer of funds between Agent and Lenders, Agent may, at
its option, subject to the terms of this Section, make available, on behalf of
Lenders, including the Swing Line Lender, the full amount of the Revolving Loans
or Swing Line Loans requested or charged to any Borrower’s loan account(s) or
otherwise to be advanced by Lenders pursuant to the terms hereof, without
requirement of prior notice to Lenders of the proposed Loans.
          (b) With respect to all Revolving Loans made by Agent on behalf of
Lenders, the amount of each Lender’s Pro Rata Share of the outstanding Loans
shall be computed weekly, and shall be adjusted upward or downward on the basis
of the amount of the outstanding Revolving Loans as of 5:00 p.m. on the Business
Day immediately preceding the date of each settlement computation; provided,
that, Agent retains the absolute right at any time or from time to time to make
the above described adjustments at intervals more frequent than weekly, but in
no event more than twice in any week. With respect to or any Swing Line Loans
made by Swing Line Lender or Agent on behalf of Swing Line Lender, Swing Line
Lender may settle on the Swing Line Loan from time to time as it determines, but
not less frequently than weekly. Agent shall deliver to each of the Lenders
after the end of each week, or at such period or periods as Agent shall
determine, a summary statement of the amount of outstanding Loans (whether
Revolving Loans, Swing Line Loans or both) for such period (such week or other
period or periods being hereinafter referred to as a “Settlement Period”). If
the summary statement is sent by Agent and received by a Lender prior to
12:00 p.m., then such Lender shall make the settlement transfer described in
this Section by no later than 3:00 p.m. on the same Business Day and if received
by a Lender after 12:00 p.m., then such Lender shall make the settlement
transfer by not later than 3:00 p.m. on the next Business Day following the date
of receipt. If, as of the end of any Settlement Period, the amount of a Lender’s
Pro

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Rata Share of the outstanding Loans is more than such Lender’s Pro Rata Share of
the outstanding Loans as of the end of the previous Settlement Period, then such
Lender shall forthwith (but in no event later than the time set forth in the
preceding sentence) transfer to Agent by wire transfer in immediately available
funds the amount of the increase. Alternatively, if the amount of a Lender’s Pro
Rata Share of the outstanding Loans in any Settlement Period is less than the
amount of such Lender’s Pro Rata Share of the outstanding Loans for the previous
Settlement Period, Agent shall forthwith transfer to such Lender by wire
transfer in immediately available funds the amount of the decrease. The
obligation of each of the Lenders to transfer such funds and effect such
settlement shall be irrevocable and unconditional and without recourse to or
warranty by Agent. Agent and each Lender agrees to mark its books and records at
the end of each Settlement Period to show at all times the dollar amount of its
Pro Rata Share of the outstanding Loans and Letters of Credit. Each Lender shall
only be entitled to receive interest on its Pro Rata Share of the Loans to the
extent such Loans have been funded by such Lender. Because the Agent on behalf
of Lenders may be advancing and/or may be repaid Loans prior to the time when
Lenders will actually advance and/or be repaid such Loans, interest with respect
to Loans shall be allocated by Agent in accordance with the amount of Loans
actually advanced by and repaid to each Lender and the Agent and shall accrue
from and including the date such Loans are so advanced to but excluding the date
such Loans are either repaid by Borrowers or actually settled with the
applicable Lender as described in this Section.
          (c) To the extent that Agent has made any such amounts available and
the settlement described above shall not yet have occurred, upon repayment of
any Loans by a Borrower, Agent may apply such amounts repaid directly to any
amounts made available by Agent pursuant to this Section. In lieu of weekly or
more frequent settlements, Agent may, at its option, at any time require each
Lender to provide Agent with immediately available funds representing its Pro
Rata Share of each Loan, prior to Agent’s disbursement of such Loan to Borrower.
In such event, all Loans under this Agreement shall be made by the Lenders
simultaneously and proportionately to their Pro Rata Shares. No Lender shall be
responsible for any default by any other Lender in the other Lender’s obligation
to make a Loan requested hereunder nor shall the Commitment of any Lender be
increased or decreased as a result of the default by any other Lender in the
other Lender’s obligation to make a Loan hereunder.
          (d) Upon the making of any Loan by Agent as provided herein, without
further action by any party hereto, each Lender shall be deemed to have
irrevocably and unconditionally purchased and received from Agent, without
recourse or warranty, an undivided interest and participation to the extent of
such Lender’s Pro Rata Share in such Loan. To the extent that there is no
settlement in accordance with the terms hereof, Agent may at any time require
the Lenders to fund their participations. From and after the date, if any, on
which any Lender has funded its participation in any such Loan, Agent shall
promptly distribute to such Lender, such Lender’s Pro Rata Share of all payments
of principal and interest received by Agent in respect of such Loan.
          (e) If Agent is not funding a particular Loan to a Borrower (or
Administrative Borrower for the benefit of such Borrower) pursuant to
Sections 6.13(a) and 6.13(b) above on any day, but is requiring each Lender to
provide Agent with immediately available funds on the date of such Loan as
provided in Section 6.13(c) above, Agent may assume that each Lender will make
available to Agent such Lender’s Pro Rata Share of the Loan requested or
otherwise made on such day and Agent may, in its discretion, but shall not be
obligated to, cause a corresponding amount to be made available to or for the
benefit of such Borrower on such day. If Agent makes such corresponding amount
available to a Borrower and such corresponding amount is not in fact made
available to Agent by such Lender, Agent shall be entitled to recover such
corresponding amount on demand from such Lender together with interest thereon
for each day from the date such payment was due until the date such amount is
paid to Agent at the Federal Funds Rate for each day during such period (as
published by the Federal Reserve Bank of New York or at Agent’s option based on
the arithmetic mean determined by Agent of the rates

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for the last transaction in overnight Federal funds arranged prior to 9:00 a.m.
on that day by each of the three leading brokers of Federal funds transactions
in New York selected by Agent) and if such amounts are not paid within three
(3) days of Agent’s demand, at the highest Interest Rate provided for in
Section 3.1 hereof applicable to Base Rate Loans. During the period in which
such Lender has not paid such corresponding amount to Agent, notwithstanding
anything to the contrary contained in this Agreement or any of the other Loan
Documents, the amount so advanced by Agent to or for the benefit of any Borrower
shall, for all purposes hereof, be a Loan made by Agent for its own account.
Upon any such failure by a Lender to pay Agent, Agent shall promptly thereafter
notify Administrative Borrower of such failure and Borrowers shall pay such
corresponding amount to Agent for its own account within five (5) Business Days
of Administrative Borrower’s receipt of such notice. A Lender who fails to pay
Agent its Pro Rata Share of any Loans made available by the Agent on such
Lender’s behalf, or any Lender who fails to pay any other amount owing by it to
Agent, Swing Line Lender or Issuing Bank, is a “Defaulting Lender”.
          (f) Agent shall not be obligated to transfer to a Defaulting Lender
any payments received by Agent for the Defaulting Lender’s benefit, nor shall a
Defaulting Lender be entitled to the sharing of any payments hereunder
(including any principal, interest or fees). Amounts payable to a Defaulting
Lender shall instead be paid to or retained by Agent. Agent may hold and, in its
reasonable discretion, relend to a Borrower the amount of all such payments
received or retained by it for the account of such Defaulting Lender. For
purposes of voting or consenting to matters with respect to this Agreement and
the other Loan Documents and determining Pro Rata Shares, such Defaulting Lender
shall be deemed not to be a “Lender” and such Lender’s Commitment shall be
deemed to be zero (0). This Section shall remain effective with respect to a
Defaulting Lender until such default is cured. The operation of this Section
shall not be construed to increase or otherwise affect the Commitment of any
Lender, or relieve or excuse the performance by any Borrower or Guarantor of
their duties and obligations hereunder. Agent or Administrative Borrower shall
have the right, but not the obligation, at any time, and upon the exercise by
Agent or Administrative Borrower of such right, any Defaulting Lender shall have
the obligation, to immediately sell, assign and transfer to Agent or such
Eligible Transferee as Agent or Administrative Borrower may specify, the
Commitment of such Defaulting Lender and all rights and interests of such
Defaulting Lender pursuant thereto; provided, that, such Defaulting Lender shall
have received payment of an amount equal to the outstanding principal amount of
its Loans and participations in Letter of Credit Obligations and Swing Line
Loans that it has funded, if any, accrued interest thereon, accrued fees and
other amounts payable to it hereunder, from the assignee (to the extent of such
outstanding principal) and Administrative Borrower (in the case of accrued
interest, fees and other amounts, including amounts under Section 3.10). Agent
shall provide the Defaulting Lender with prior written notice of its intent to
exercise its right under this Section (or if Agent does not exercise such right,
Administrative Borrower shall provide Agent and the Defaulting Lender with prior
written notice of its intent to exercise its right under this Section), which
notice shall specify the date on which such purchase and sale shall occur. Such
purchase and sale shall be pursuant to the terms of an Assignment and Acceptance
(whether or not executed by the Defaulting Lender).
          (g) Nothing in this Section or elsewhere in this Agreement or the
other Loan Documents shall be deemed to require Agent to advance funds on behalf
of any Lender or to relieve any Lender from its obligation to fulfill its
Commitment hereunder or to prejudice any rights that any Borrower may have
against any Lender as a result of any default by any Lender hereunder in
fulfilling its Commitment.
     6.14 Obligations Several; Independent Nature of Lenders’ Rights. The
obligation of each Lender hereunder is several, and no Lender shall be
responsible for the obligation or commitment of any other Lender hereunder.
Nothing contained in this Agreement or any of the other Loan Documents and no
action taken by the Lenders pursuant hereto or thereto shall be deemed to
constitute the Lenders to be a partnership, an association, a joint venture or
any other kind of entity. The amounts payable at any time hereunder to each
Lender shall be a separate and independent debt, and subject to Section 14.3
hereof,

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each Lender shall be entitled to protect and enforce its rights arising out of
this Agreement and it shall not be necessary for any other Lender to be joined
as an additional party in any proceeding for such purpose.
     6.15 Bank Products. Borrowers and Guarantors, or any of their Subsidiaries,
may (but no such Person is required to) request that the Bank Product Providers
provide or arrange for such Person to obtain Bank Products from Bank Product
Providers, and each Bank Product Provider may, in its sole discretion, provide
or arrange for such Person to obtain the requested Bank Products. Borrowers and
Guarantors or any of their Subsidiaries that obtains Bank Products shall
indemnify and hold Agent, each Lender and their respective Affiliates harmless
from any and all obligations now or hereafter owing to any other Person by any
Bank Product Provider in connection with any Bank Products other than for gross
negligence or willful misconduct on the part of any such indemnified Person.
This Section 6.15 shall survive the payment of the Obligations and the
termination of this Agreement. Borrower and its Subsidiaries acknowledge and
agree that the obtaining of Bank Products from Bank Product Providers (a) is in
the sole discretion of such Bank Product Provider, and (b) is subject to all
rules and regulations of such Bank Product Provider. Each Bank Product Provider
shall be deemed a party hereto for purposes of any reference in a Loan Document
to the parties for whom Agent is acting; provided, that, the rights of such Bank
Product Provider hereunder and under any of the other Loan Documents shall
consist exclusively of such Bank Product Provider’s right to share in payments
and collections out of the Collateral as set forth herein. In connection with
any such distribution of payments and collections, Agent shall be entitled to
assume that no amounts are due to any Bank Product Provider unless such Bank
Product Provider has notified Agent in writing of any such liability owed to it
as of the date of any such distribution.
SECTION 7. COLLATERAL REPORTING AND COVENANTS
     7.1 Collateral Reporting.
          (a) Borrowers shall provide Agent with the following documents in a
form satisfactory to Agent, in each case setting forth the information with
respect to US Borrowers and Canadian Borrowers on a separate basis:
               (i) as soon as possible after the end of each calendar month (but
in any event within eleven (11) Business Days after the end thereof); except,
that, so long as a Default or Event of Default exists or has occurred and is
continuing or US Excess Availability is less than twelve and one-half (12.5%)
percent of the US Loan Limit or Canadian Excess Availability is less than twelve
and one-half (12.5%) percent of the Canadian Loan Limit, as soon as possible
after the end of each calendar week (but in any event within three (3) Business
Days after the end thereof), a Borrowing Base Certificate setting forth the
calculation of the US Borrowing Base and Canadian Borrowing Base as of the last
Business Day of the immediately preceding period, duly completed and executed by
the chief financial officer, vice president of finance, treasurer or controller
of Administrative Borrower, together with all schedules required pursuant to the
terms of the Borrowing Base Certificate duly completed;
               (ii) as soon as possible after the end of each calendar month
(but in any event within fifteen (15) Business Days after the end thereof), on a
monthly basis or more frequently as Agent may request at any time that (A) a
Default or Event of Default exists or (B) US Excess Availability is not less
than twelve and one-half (12.5%) percent of the US Loan Limit and Canadian
Excess Availability is not greater than twelve and one-half (12.5%) percent of
the Canadian Loan Limit, (1) perpetual inventory reports by division (and
including the amounts of Inventory and the value thereof at any leased locations
and at premises of warehouses, processors or other third parties or consignees),
(2) reconciliation of inventory as set forth in the perpetual inventory reports
and general ledger of Borrowers, (3) agings of accounts receivable (together
with a reconciliation to the previous period’s aging and the general ledger),
(4) Inventory by location (5) agings of outstanding accounts payable (and
including information indicating the amounts owing to owners and lessors of
leased premises, warehouses, processors, and other third parties from time to
time in possession of any Collateral);

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               (iii) as soon as possible after the end of each calendar month
(but in any event within fifteen (15) Business Days after the end thereof), on a
monthly basis or more frequently as Agent may request at any time that (A) a
Default or Event of Default exists or (B) US Excess Availability is not greater
than twelve and one-half (12.5%) percent of the US Loan Limit and Canadian
Excess Availability is not greater than twelve and one-half (12.5%) percent of
the Canadian Loan Limit, a certificate by the chief financial officer, vice
president of finance, treasurer or controller of Parent consisting of: (1) a
statement confirming the payment of rent and other amounts due to owners and
lessors of real property used by Borrowers in the immediately preceding month,
subject to year-end or monthly percentage rent payment adjustments, except as
specifically described in such certificate, (2) the addresses of all new
locations of Borrowers and Guarantors acquired or opened since the date of the
most recent certificate delivered to Agent containing the information required
under this clause, (3) a report of any new deposit account established or used
by any Borrower or Guarantor with any bank or other financial institution,
including in each case, the Borrower or Guarantor in whose name the account is
maintained, the account number, the name and address of the financial
institution at which such account is maintained, the purpose of such account
and, if any, the amount held in such account on or about the date of such
report, and (4) a statement that all sales, use and excise taxes have been paid
when due as of the date of the certificate, except as specifically described in
such certificate,
               (iv) upon Agent’s reasonable request, (A) reports of sales for
each category of Inventory, (B) summary reports on sales and use tax
collections, deposits and payments, including monthly sales and use tax
accruals, (C) true, correct and complete copies of all agreements, documents or
instruments evidencing or otherwise related to Indebtedness that Agent has not
otherwise received and (D) a certificate of the chief financial officer, vice
president of finance, treasurer or controller of Parent listing (1) all
applications, if any, for Intellectual Property made since the date of the prior
certificate (or, in the case of the first such certificate, the date hereof),
(2) all issuances of registrations or letters on existing applications for
Intellectual Property received since the date of the prior certificate (or, in
the case of the first such certificate, the date hereof), and (3) all License
Agreements entered into since the date of the prior certificate (or, in the case
of the first such certificate, the date hereof); and
               (v) such other reports as to the Collateral as Agent shall
reasonably request from time to time.
          (b) Nothing contained in any Borrowing Base Certificate shall be
deemed to limit, impair or otherwise affect the rights of Agent contained herein
and in the event of any conflict or inconsistency between the calculation of the
Borrowing Base as set forth in any Borrowing Base Certificate and as determined
by Agent in good faith, the determination of Agent shall govern and, absent
manifest error, be conclusive and binding upon Borrowers and Guarantors. Without
limiting the foregoing, Borrowers shall furnish to Agent any information which
Agent may reasonably request regarding the determination and calculation of any
of the amounts set forth in any Borrowing Base Certificate. Subject to the
limitations set forth herein, the Borrowing Base may be adjusted based on the
information received by Agent pursuant to this Agreement. If any Borrower’s or
Guarantor’s records or reports of the Collateral are prepared or maintained by
an accounting service, contractor, shipper or other agent, such Borrower and
Guarantor hereby irrevocably authorizes such service, contractor, shipper or
agent to deliver such records, reports, and related documents to Agent and to
follow Agent’s reasonable instructions with respect to further services.

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          (c) All of the documents, reports and schedules provided by or on
behalf of any Borrower or Guarantor to Agent hereunder for Receivables payable
in any currency other than US Dollars and Inventory located outside the United
States of America shall set forth the US Dollar Equivalent for the amount of the
Receivables and Value of the Equipment included in any such documents, reports
or schedules. For purposes hereof, Agent may, at its option, provide to
Administrative Borrower, at least five (5) Business Days prior to the date any
such documents, reports or schedules are required to be provided by Borrowers or
Guarantors to Agent hereunder, the exchange rates required to set forth the US
Dollar Equivalent in such documents, reports and schedules and in the event
Agent does not do so, Borrowers shall use such rates of exchange with respect to
the applicable currencies as Borrowers and Guarantors use for such purpose in
the ordinary course of business consistent with current practices as of the date
hereof and shall identify such rates of exchange in any such documents, reports
and schedules
     7.2 Accounts Covenants.
          (a) Borrowers shall notify Agent promptly of (i) the assertion of any
claims, offsets, defenses or counterclaims by any account debtor, or any
disputes with any account debtor or any settlement, adjustment or compromise
thereof, to the extent any of the foregoing exceeds $250,000 in any one case or
$750,000 in the aggregate and (ii) all material adverse information of which it
has notice relating to the financial condition of any account debtor No credit,
discount, allowance or extension or agreement for any of the foregoing shall be
granted to any account debtor except in the ordinary course of a Borrower’s
business in accordance with the current practices of such Borrower as in effect
on the date hereof. At any time that an Event of Default exists or has occurred
and is continuing, Agent shall, at its option, have the exclusive right to
settle, adjust or compromise any claim, offset, counterclaim or dispute with
account debtors or grant any credits, discounts or allowances.
          (b) With respect to each Account: (i) the amounts shown on any invoice
delivered to Agent or schedule thereof delivered to Agent shall be true and
complete in all material respects, (ii) no payments shall be made thereon except
those sent to the Cash Management Accounts or Concentration Accounts, (iii) no
credit, discount, allowance or extension or agreement for any of the foregoing
shall be granted to any account debtor except as reported to Agent in accordance
with this Agreement and except for credits, discounts, allowances or extensions
made or given in the ordinary course of each Borrower’s business, (iv) there
shall be no setoffs, deductions, contras, defenses, counterclaims or disputes
existing or asserted with respect thereto other than as reported to Agent in
accordance with the terms of this Agreement, and (v) none of the transactions
giving rise thereto will violate any applicable foreign, Federal, State or local
laws or regulations, all documentation relating thereto will be legally
sufficient under such laws and regulations and all such documentation will be
legally enforceable in accordance with its terms.
          (c) Agent shall have the right at any time or times, in the name of a
nominee or, following the occurrence of an Event of Default, in Agent’s name or
in the name of a nominee of Agent, to verify the validity, amount or any other
matter relating to any Receivables or other Collateral, by mail, telephone,
facsimile transmission or otherwise.
     7.3 Inventory Covenants. With respect to the Inventory: (a) each Borrower
and Guarantor shall at all times maintain inventory records reasonably
satisfactory to Agent, keeping correct and accurate records in all material
respects itemizing and describing the kind, type, quality and quantity of
Inventory, such Borrower’s or Guarantor’s cost therefor and daily withdrawals
therefrom and additions thereto; (b) Borrowers and Guarantors shall conduct a
physical count of the Inventory either through periodic cycle counts or wall to
wall counts, so that all Inventory is subject to such counts at least once each
year (except with respect to Inventory consisting of finished goods windows
located at a plant of a Borrower or Guarantor, as to which a physical count
shall be conducted not less frequently than as of each calendar

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month end), but at any time or times as Agent may request at any time a Default
or an Event of Default exists or has occurred and is continuing, and promptly
following such physical inventory (whether through periodic cycle counts or wall
to wall counts) shall supply Agent at least once each calendar quarter if any
such counts are performed within such quarter, or otherwise once each calendar
year, with a report in the form and with such specificity as may be reasonably
satisfactory to Agent concerning such physical count; (c) Borrowers and
Guarantors shall not remove any Inventory from the locations set forth or
permitted herein, without the prior written consent of Agent, except for sales
of Inventory in the ordinary course of its business and except to move Inventory
directly from one location set forth or permitted herein to another such
location and except for Inventory shipped from the manufacturer thereof to such
Borrower or Guarantor which is in transit to the locations set forth or
permitted herein; except, that, Borrowers and Guarantors may remove Inventory
not constituting Eligible Inventory and having an aggregate value of not more
than the US Dollar Equivalent of $1,000,000 to locations not otherwise permitted
hereunder; provided, that, as the date of the removal of any such Inventory and
after giving effect thereto (i) no Default or Event of Default shall exist or
have occurred and be continuing and (ii) Global Excess Availability of Borrowers
equals not less than twelve and one-half (12 1/2%) percent of the Maximum
Credit, (iii) Canadian Excess Availability equals not less than twelve and
one-half (12 1/2%) percent of the Canadian Loan Limit and (iv) US Excess
Availability equals not less than twelve and one-half (12 1/2%) percent of the
US Loan Limit; (d) Borrowers shall, (i) at their expense, two (2) times in any
twelve (12) month period, (ii) at their expense, one (1) additional time at any
time that Global Excess Availability is less than the US Dollar Equivalent of
$75,000,000, upon Agent’s request, (iii) at Agent’s expense, one (1) further
additional time, as Agent may request in such twelve (12) month period and
(iv) at any time at Borrowers’ expense as Agent may request if a Default or
Event of Default shall exist or have occurred and be continuing, deliver or
cause to be delivered to Agent written appraisals as to the Inventory in form,
scope and methodology reasonably acceptable to Agent and by an appraiser
reasonably acceptable to Agent, addressed to Agent and Lenders and upon which
Agent and Lenders are expressly permitted to rely; (e) Borrowers and Guarantors
shall produce, use, store and maintain the Inventory with all reasonable care
and caution and in accordance with applicable standards of any insurance and in
conformity with applicable laws (including the requirements of the Federal Fair
Labor Standards Act of 1938, as amended and all rules, regulations and orders
related thereto); (f) as between Agent and Lenders, on the one hand, and
Borrowers and Guarantors, on the other hand, each Borrower and Guarantor assumes
all responsibility and liability arising from or relating to the use, sale or
other disposition of the Inventory (but nothing contained herein shall be
construed as the basis for any liability of any Borrower or Guarantor as to any
third party); (g) as of the date hereof, Borrowers and Guarantors do not sell
Inventory to any customer on approval, or any other basis which entitles the
customer to return or may obligate any Borrower or Guarantor to repurchase such
Inventory but shall give Agent prior written notice if such practice changes
together with such information with respect to the new policy as may reasonably
be requested by Agent; (h) Borrowers and Guarantors shall keep the Inventory in
good and marketable condition; (i) Borrowers and Guarantors shall provide to
Agent prompt notice of any License Agreement entered into by a Borrower or
Guarantor related to Accounts or Inventory, which License Agreement constitutes
a Material Contract; and (j) Borrowers and Guarantors shall not acquire or
accept any Inventory on consignment or approval unless such Inventory has been
specifically identified in a report with respect thereto provided by
Administrative Borrower to Agent pursuant to Section 7.1(a) hereof when required
to be included in such report or Agent has otherwise received prior written
notice thereof in form and substance reasonably satisfactory to Agent.
     7.4 Equipment and Real Property Covenants. With respect to the Equipment
and Real Property: (a) Borrowers shall, at their expense, one (1) time in any
twelve (12) month period, (b) one (1) additional time at any time that Global
Excess Availability is less than the US Dollar Equivalent of $50,000,000, upon
Agent’s request, (c) at Agent’s expense, one (1) further additional time, as
Agent may request in such twelve (12) month period, and (d) at any time at
Borrowers’ expense as Agent may request if a Default or Event of Default shall
exist or have occurred and be continuing, deliver or cause to be

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delivered to Agent written appraisals as to the Equipment and/or Real Property,
in form, scope and methodology acceptable to Agent and by an appraiser
acceptable to Agent, addressed to Agent and Lenders and upon which Agent and
Lenders are expressly permitted to rely; (e) Borrowers and Guarantors shall keep
the Equipment in good order, repair, running and marketable condition (ordinary
wear and tear excepted); (f) Borrowers and Guarantors shall use the Equipment
and Real Property with all reasonable care and caution and in accordance with
applicable standards of any insurance and in conformity with all applicable laws
in all material respects; (g) the Equipment is and shall be used in the business
of Borrowers and Guarantors and not for personal, family, household or farming
use; provided, that, certain motor vehicles used primarily by employees for
business purposes may from time to time be incidentally used for personal,
family or household use, as permitted by the internal policies of the applicable
Borrower or Guarantor if any; (h) Borrowers and Guarantors shall not remove any
Equipment from the locations set forth or permitted herein, except to the extent
necessary to have any Equipment repaired, replaced or maintained in the ordinary
course of its business or to move Equipment directly from one location set forth
or permitted herein to another such location and except for the movement of
motor vehicles used by or for the benefit of such Borrower or Guarantor in the
ordinary course of business; except, that, Borrowers and Guarantors may remove
Equipment not constituting Eligible Equipment and having an aggregate value of
not more than the US Dollar Equivalent of $250,000 to locations not otherwise
permitted hereunder; provided, that, as the date of the renewal of any such
Equipment and after giving effect thereto (i) no Default or Event of Default
shall exist or have occurred and be continuing and (ii) Global Excess
Availability of Borrowers equals not less than twelve and one-half (12 1/2%)
percent of the Maximum Credit, (iii) Canadian Excess Availability equals not
less than twelve and one-half (12 1/2%) percent of the Canadian Loan Limit and
(iv) US Excess Availability equals not less than twelve and one-half (12 1/2%)
percent of the US Loan Limit; (i) the Equipment is now and shall remain personal
property and Borrowers and Guarantors shall not permit any of the Equipment to
be or become a part of or affixed to real property (but not including for this
purpose any plumbing and electrical fixtures, heating, ventilation and air
conditioning, wall and floor coverings, walls or ceilings and other fixtures not
constituting trade fixtures); and (j) as between Agent and Lenders, on the one
hand, and Borrowers and Guarantors, on the other hand, each Borrower and
Guarantor assumes all responsibility and liability arising from or relating to
the use, sale or other disposition of the Equipment or Real Property (but
nothing contained herein shall be construed as the basis for any liability of
any Borrower or Guarantor as to any third party).
     7.5 Power of Attorney. Each Borrower and Guarantor hereby irrevocably
designates and appoints Agent (and all persons designated by Agent) as such
Borrower’s and Guarantor’s true and lawful attorney-in-fact, and authorizes
Agent, in such Borrower’s, Guarantor’s or Agent’s name, to: (a) at any time an
Event of Default exists or has occurred and is continuing (i) demand payment on
any Collateral, (ii) enforce payment of any of the Collateral by legal
proceedings or otherwise, (iii) exercise all of such Borrower’s or Guarantor’s
rights and remedies to collect any Collateral, (iv) sell or assign any
Collateral upon such terms, for such amount and at such time or times as the
Agent deems advisable, (v) settle, adjust, compromise, extend or renew any of
the Collateral, (vi) discharge and release any Collateral, (vii) prepare, file
and sign such Borrower’s or Guarantor’s name on any proof of claim in bankruptcy
or other similar document against an account debtor or other obligor in respect
of any Collateral, (viii) notify the post office authorities to change the
address for delivery of remittances from account debtors or other obligors in
respect of Collateral to an address designated by Agent, and open and dispose of
all mail addressed to such Borrower or Guarantor and handle and store all mail
relating to the Collateral, (ix) clear Inventory the purchase of which was
financed with a Letter of Credit through U.S. Bureau of Customs and Border
Protection or foreign export control authorities in such Borrower’s or
Guarantor’s name, Agent’s name or the name of Agent’s designee, and to sign and
deliver to customs officials powers of attorney in such Borrower’s or
Guarantor’s name for such purpose, and to complete in such Borrower’s or
Guarantor’s or Agent’s name, any order, sale or transaction, obtain the
necessary documents in connection therewith and collect the proceeds thereof,
and (x) do all acts and things which are necessary,

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in Agent’s reasonable determination, to fulfill such Borrower’s or Guarantor’s
obligations under this Agreement and the other Loan Documents and (b) at any
time a Cash Dominion Event exists to (i) take control in any manner of any item
of payment constituting Collateral or otherwise received in or for deposit in
the Concentration Accounts and (ii) have access to any lockbox or postal box
into which remittances from account debtors or other obligors in respect of
Collateral are sent or received if a Cash Dominion Event exists, and (c) at any
time to (i) take control of any item of payment constituting Collateral that is
received by Agent or any Lender, (ii) endorse such Borrower’s or Guarantor’s
name upon any items of payment in respect of Collateral received by Agent and
any Lender and deposit the same in Agent’s account for application to the
Obligations, (iii) endorse such Borrower’s or Guarantor’s name upon any chattel
paper, document, instrument, invoice, or similar document or agreement relating
to any Receivable or any goods pertaining thereto or any other Collateral,
including any warehouse or other receipts, or bills of lading and other
negotiable or non-negotiable documents, and (iv) sign such Borrower’s or
Guarantor’s name on any verification of amounts owing constituting Collateral
and notices thereof to account debtors or any secondary obligors or other
obligors in respect thereof. Each Borrower and Guarantor hereby releases Agent
and Lenders and their respective officers, employees and designees from any
liabilities arising from any act or acts under this power of attorney and in
furtherance thereof, whether of omission or commission, except as a result of
Agent’s or any Lender’s own gross negligence or willful misconduct as determined
pursuant to a final non-appealable order of a court of competent jurisdiction.
     7.6 Right to Cure. Agent may, at its option, upon not less than five
(5) days prior notice to Administrative Borrower (except, that, no such prior
notice shall be required in the case of exigent circumstances as reasonably
determined by Agent in good faith), at any time that an Event of Default has
occurred and is then continuing, (a) cure any default by any Borrower or
Guarantor under any material agreement with a third party that affects the
Collateral, its value or the ability of Agent to collect, sell or otherwise
dispose of the Collateral or the rights and remedies of Agent or any Lender
therein or the ability of any Borrower or Guarantor to perform its obligations
hereunder or under any of the other Loan Documents, (b) pay or bond on appeal
any judgment entered against any Borrower or Guarantor, (c) discharge taxes,
liens, security interests or other encumbrances at any time levied on or
existing with respect to the Collateral and (d) pay any amount, incur any
expense or perform any act which, in Agent’s judgment, is necessary or
appropriate to preserve, protect, insure or maintain the Collateral and the
rights of Agent and Lenders with respect thereto. Agent may add any amounts so
expended to the Obligations and charge any Borrower’s account therefor or may
demand immediate payment thereof. Agent and Lenders shall be under no obligation
to effect such cure, payment or bonding and shall not, by doing so, be deemed to
have assumed any obligation or liability of any Borrower or Guarantor.
     7.7 Access to Premises. From time to time as reasonably requested by Agent,
at the cost and expense of Borrowers, (a) Agent or its designee shall have
complete access to all of each Borrower’s and Guarantor’s premises during normal
business hours and after reasonable prior notice to Parent, or at any time and
without notice to Administrative Borrower if an Event of Default exists or has
occurred and is continuing, for the purposes of inspecting, verifying and
auditing the Collateral and all of each Borrower’s and Guarantor’s books and
records, including the Records, and (b) each Borrower and Guarantor shall
promptly furnish to Agent such copies of such books and records or extracts
therefrom as Agent may reasonably request, and Agent or any Lender or Agent’s
designee may use during normal business hours such of any Borrower’s and
Guarantor’s personnel, equipment, supplies and premises as may be reasonably
necessary for the foregoing and if an Event of Default exists or has occurred
and is continuing for the collection of Receivables and realization of other
Collateral. Agent shall not conduct more than two (2) field examinations with
respect to the Collateral in any twelve (12) month period at the expense of
Borrowers; except, that, (i) Agent may conduct one (1) additional field
examination at its expense upon request in such twelve (12) month period,
(ii) Agent may conduct one (1) further additional field examination at
Borrowers’ expense at Agent’s request at any time Global Excess Availability
shall

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be less than the US Dollar Equivalent of $75,000,000 or US Excess Availability
shall be less than the US Dollar Equivalent of $50,000,000 or Canadian Excess
Availability shall be less than the US Dollar Equivalent of $25,000,000 and
(iii) Agent may conduct such other field examinations at the expense of
Borrowers as Agent may reasonably require at Borrowers’ expense at any time a
Default or Event of Default shall exist or have occurred and be continuing.
SECTION 8. REPRESENTATIONS AND WARRANTIES
Each Borrower and Guarantor hereby represents and warrants to Agent, Lenders and
Issuing Bank the following:
     8.1 Existence, Power and Authority. Each Borrower and Guarantor is a
corporation, limited liability company or limited partnership duly organized and
in good standing under the laws of its jurisdiction of organization and is duly
qualified as a foreign or extra-provincial corporation, limited liability
company or limited partnership, as applicable, and in good standing in all
states or other jurisdictions where the nature and extent of the business
transacted by it or the ownership of assets makes such qualification necessary
(to the extent the concept of good standing is applicable to such Borrower or
Guarantor under the laws of the relevant state or jurisdiction), where the
failure to so qualify, has or would reasonably be expected to have a Material
Adverse Effect. The execution, delivery and performance of this Agreement, the
other Loan Documents and the transactions contemplated hereunder and thereunder
(a) are all within each Borrower’s and Guarantor’s corporate, limited liability
company or limited partnership powers, as applicable, (b) have been duly
authorized, (c) are not in contravention of law or the terms of any Borrower’s
or Guarantor’s certificate of incorporation, certificate of formation, bylaws,
operating agreement, limited partnership agreement or other organizational
documentation, or any indenture, material agreement or undertaking to which any
Borrower or Guarantor is a party or by which any Borrower or Guarantor or its
property are bound and (d) will not result in the creation or imposition of, or
require or give rise to any obligation to grant, any lien, security interest,
charge or other encumbrance upon any property of any Borrower or Guarantor
except as permitted hereunder. This Agreement and the other Loan Documents to
which any Borrower or Guarantor is a party constitute legal, valid and binding
obligations of such Borrower and Guarantor enforceable in accordance with their
respective 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 law).
     8.2 Name; Jurisdiction of Organization; Chief Executive Office; Collateral
Locations.
          (a) The exact legal name of each Borrower and Guarantor is as set
forth on the signature page of this Agreement and in the Information
Certificate. No Borrower or Guarantor has, during the five (5) years prior to
the date of this Agreement, been known by or used any other corporate or
fictitious name or been a party to any merger or consolidation, or acquired all
or substantially all of the assets of any Person, or acquired any of its
property or assets out of the ordinary course of business, except as set forth
in the Information Certificate.
          (b) Each Borrower and Guarantor is an organization of the type and
organized in the jurisdiction set forth in the Information Certificate. The
Information Certificate accurately sets forth the organizational identification
number of each Borrower and Guarantor or accurately states that such Borrower or
Guarantor has none and accurately sets forth the federal employer identification
number and business identification number of each Borrower and Guarantor, if
applicable.

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          (c) The chief executive office and mailing address of each Borrower
and Guarantor and each Borrower’s and Guarantor’s Records concerning Accounts
are located only at the address identified as such in Schedule 8.2 to the
Information Certificate and its only other places of business and the only other
locations of Collateral, if any, are the addresses set forth in Schedule 8.2 to
the Information Certificate, subject to the rights of any Borrower or Guarantor
to establish new locations in accordance with Section 9.2 below and other than
Collateral in transit to any such locations. The Information Certificate
correctly identifies any of such locations that are not owned by a Borrower or
Guarantor and sets forth the owners and/or operators thereof.
     8.3 Financial Statements; No Material Adverse Effect. All financial
statements relating to any Borrower or Guarantor which have been or may
hereafter be delivered by any Borrower or Guarantor to Agent and Lenders have
been prepared in accordance with GAAP (except as to any interim financial
statements, to the extent such statements are subject to normal year-end
adjustments and do not include any notes) and fairly present in all material
respects the financial condition and the results of operation of such Borrower
and Guarantor as at the dates and for the periods set forth therein. Except as
disclosed in any interim financial statements furnished by Borrowers and
Guarantors to Agent prior to the date of this Agreement, there has been no act,
condition or event which has had or would reasonably be expected to have a
Material Adverse Effect since the date of the most recent audited financial
statements of any Borrower or Guarantor furnished by any Borrower or Guarantor
to Agent prior to the date of this Agreement. The projections dated July 28,
2008, for the fiscal years ending 2008 through and including 2013 that have been
delivered to Agent or any projections hereafter delivered to Agent have been or
will be prepared in good faith based upon assumption believed by the Parent to
be reasonable at the time made and fair in light of the then current conditions
and facts.
     8.4 Priority of Liens; Title to Properties. The security interests, liens
and hypothecs granted to Agent under this Agreement and the other Loan Documents
constitute valid and perfected first priority liens, hypothecs and security
interests in and upon the Collateral subject only to the liens indicated on
Schedule 8.4 to the Information Certificate and the other liens permitted under
Section 10.2 hereof. Each Borrower and Guarantor has good and marketable fee
simple title to or valid leasehold interests in all of its Real Property and
good, valid and merchantable title to all of its other properties and assets
subject to no liens, mortgages, pledges, security interests, encumbrances or
charges of any kind, except those granted to Agent and such others as are
specifically listed on Schedule 8.4 to the Information Certificate or permitted
under Section 10.2 hereof.
     8.5 Tax Returns. Each Borrower and Guarantor has filed, or caused to be
filed, in a timely manner all material tax returns, reports and declarations
which are required to be filed by it. All information in such tax returns,
reports and declarations is complete and accurate in all material respects. Each
Borrower and Guarantor has paid or caused to be paid all taxes due and payable
by it, except taxes the validity of which is being contested in good faith by
appropriate proceedings diligently pursued and available to such Borrower or
Guarantor and with respect to which adequate reserves have been set aside on its
books. Adequate provision has been made for the payment of all accrued and
unpaid Federal, State, county, local, foreign and other taxes whether or not yet
due and payable and whether or not disputed. No notices of tax liens or tax
liens have been filed with respect to any such taxes.
     8.6 Litigation. Except as set forth on Schedule 8.6 to the Information
Certificate, (a) there is no investigation by any Governmental Authority, or
action, suit, proceedings or claim by any Person, pending, or to the best of any
Borrower’s or Guarantor’s knowledge threatened in writing, against or affecting
any Borrower or Guarantor, its or their assets or business which if adversely
determined against such Borrower or Guarantor, individually or in the aggregate,
has or would reasonably be expected to have a Material Adverse Effect and
(b) there is no action, suit, proceeding or claim by any Person pending, or to
the best of any Borrower’s or Guarantor’s knowledge threatened in writing, that
involve this Agreement or any transactions contemplated by this Agreement, in
each case which has or would reasonably be expected to have a Material Adverse
Effect.

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     8.7 Compliance with Other Agreements and Applicable Laws. Borrowers and
Guarantors are in compliance with the requirements of all applicable laws,
rules, regulations and orders of any Governmental Authority relating to their
respective businesses, in each case where the failure to comply, individually or
in the aggregate has not or would not reasonably be expected to have a Material
Adverse Effect. No Borrower or Guarantor, or any Subsidiary or Affiliate of any
Borrower or Guarantor: (a) is a Sanctioned Person, (b) has more than ten (10%)
percent of its assets in Sanctioned Entities, or (c) derives more than ten (10%)
percent of its operating income from investments in, or transactions with
Sanctioned Persons or Sanctioned Entities. The proceeds of any Loan will not be
used and have not been used to fund any operations in, finance any investments
or activities in, or make any payments to, a Sanctioned Person or a Sanctioned
Entity. Borrowers and Guarantors have obtained all material permits, licenses,
approvals, consents, certificates, orders or authorizations of any Governmental
Authority required for the lawful conduct of its business (the “Permits”),
except where the failure to obtain would not be reasonably expected to have a
Material Adverse Effect. All of the Permits are valid and subsisting and in full
force and effect. There are no actions, claims or proceedings pending or to the
best of any Borrower’s or Guarantor’s knowledge, threatened in writing that seek
the revocation, cancellation, suspension or modification of any of the Permits
where, individually or in the aggregate, it has or would reasonably be expected
to have a Material Adverse Effect. Borrowers and Guarantors are not in default
in any respect under, or in violation in any respect of the terms of, any
indentures, agreements or other instrument governing Indebtedness binding on it
or its property.
     8.8 Environmental Compliance.
          (a) Except as set forth in Schedule 8.8 to the Information
Certificate, Borrowers, Guarantors and any Subsidiary of any Borrower or
Guarantor, have not generated, used, stored, treated, transported, manufactured,
handled, produced or disposed of any Hazardous Materials, on any property owned
or leased by Borrowers, Guarantors or any Subsidiary thereof in any manner that
violates any applicable Environmental Law or Permit where such violation,
individually or in the aggregate, has or would reasonably be expected to have a
Material Adverse Effect; the operations of Borrowers, Guarantors and any
Subsidiary of any Borrower or Guarantor at such properties complies in all
material respects with all applicable Environmental Laws and Permits and any
non-compliance, individually or in the aggregate, is not or would not be
reasonably expected to have a Material Adverse Effect.
          (b) Except as set forth in Schedule 8.8 to the Information
Certificate, no Borrower or Guarantor has received any notice of or otherwise
has any information that there has been any investigation by any Governmental
Authority or any proceeding, complaint, order, directive, claim, citation or
notice by any Governmental Authority or any other person nor is any
investigation pending or to the best of any Borrower’s or Guarantor’s knowledge
threatened in writing, with respect to any non-compliance with or violation of
the requirements of any Environmental Law by any Borrower or Guarantor and any
of its Subsidiaries or the release, spill or discharge, threatened or actual, of
any Hazardous Material or the generation, use, storage, treatment,
transportation, manufacture, handling, production or disposal of any Hazardous
Materials or any other environmental, health or safety matter with regard to any
properties or assets owned, leased or operated by it or used by Borrowers,
Guarantors or their Subsidiaries, which, individually or in the aggregate, has
or would reasonably be expected to have a Material Adverse Effect.
          (c) Except as set forth in Schedule 8.8 to the Information
Certificate, Borrowers, Guarantors and their Subsidiaries have no material
liability (contingent or otherwise) in connection with a threatened or actual
release, spill or discharge of any Hazardous Materials or related to the
generation, use, storage, treatment, transportation, manufacture, handling,
production or disposal of any Hazardous Materials at, on, under or from any
property owned, leased or operated by it or used by it or otherwise in
connection with their businesses which, individually or in the aggregate, has or
would reasonably be expected to have a Material Adverse Effect.

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     8.9 Employee Benefits.
          (a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other applicable Federal or State
law. Each Plan which is intended to qualify under Section 401(a) of the Code has
received a favorable determination letter from the Internal Revenue Service and
to the best of any Borrower’s or Guarantor’s knowledge, nothing has occurred
which would cause the loss of such qualification where such loss, when combined
with other such occurrences or failures to comply, has or would reasonably be
expected to have a Material Adverse Effect. Each Borrower and its ERISA
Affiliates have made all required contributions to any Plan subject to
Section 412 of the Code, and no application for a funding waiver or an extension
of any amortization period pursuant to Section 412 of the Code has been made
with respect to any Plan.
          (b) Except as set forth in the Information Certificate, there are no
pending, or to the best of any Borrower’s or Guarantor’s knowledge, threatened
claims, actions or lawsuits, or action by any Governmental Authority, with
respect to any Plan. Except as set forth in the Information Certificate, there
has been no prohibited transaction or violation of the fiduciary responsibility
rules with respect to any Plan that would result in any material liability by
any Borrower or Guarantor.
          (c) Except as would not, individually and in the aggregate, reasonably
be expected to have a Material Adverse Effect or as set forth in the Information
Certificate, (i) no ERISA Event has occurred or is reasonably expected to occur;
(ii) based on the latest valuation of each Pension Plan and on the actuarial
methods and assumptions employed for such valuation (determined in accordance
with the assumptions used for funding such Pension Plan pursuant to Section 412
of the Code), the aggregate current value of accumulated benefit liabilities of
such Pension Plan under Section 4001(a)(16) of ERISA does not exceed the
aggregate current value of the assets of such Pension Plan; (iii) each Borrower
and Guarantor, and their ERISA Affiliates, have not incurred and do not
reasonably expect to incur, any liability under Title IV of ERISA with respect
to any Plan (other than premiums due and not delinquent under Section 4007 of
ERISA); (iv) each Borrower and Guarantor, and their ERISA Affiliates, have not
incurred and do not reasonably expect to incur, any liability (and no event has
occurred which, with the giving of notice under Section 4219 of ERISA, would
result in such liability) under Section 4201 or 4243 of ERISA with respect to a
Multiemployer Plan; and (v) each Borrower and Guarantor, and their ERISA
Affiliates, have not engaged in a transaction that would be subject to
Section 4069 or 4212(c) of ERISA.
          (d) With respect to any Canadian Pension Plan, to the best of the
knowledge of each Borrower and Guarantor, except as would not, individually and
in the aggregate, reasonably be expected to have a Material Adverse Effect:
(i) the Canadian Pension Plans are duly registered under all applicable Federal
and Provincial pension benefits legislation, (ii) all statutory obligations of
any Borrower or Guarantor required to be performed in connection with the
Canadian Pension Plans or the funding agreements therefor have been performed in
a timely fashion and there are no outstanding disputes concerning the assets
held pursuant to any such funding agreement, (iii) all contributions or premiums
required to be made by any Borrower or Guarantor to the Canadian Pension Plans
have been made in a timely fashion in accordance with the terms of the Canadian
Pension Plans and applicable laws and regulations, (iv) all employee
contributions to the Canadian Pension Plans required to be made by way of
authorized payroll deduction have been properly withheld by any Borrower or
Guarantor and fully paid into the Canadian Pension Plans in a timely fashion,
(v) all reports and disclosures relating to the Canadian Pension Plans required
by any applicable laws or regulations have been filed or distributed in a timely
fashion, (vi) there have been no improper withdrawals, or applications of, the
assets of any of the Pension Plans, (vii) no amount is owing by any of the
Canadian Pension Plans under the Income Tax Act

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(Canada) or any provincial taxation statute, (viii) the Canadian Pension Plans
are fully funded in accordance with applicable law both on an ongoing basis and
on a solvency basis (using actuarial assumptions and methods which are
consistent with the valuations last filed with the applicable governmental
authorities and which are consistent with generally accepted actuarial
principles), and (ix) none of the Canadian Pension Plans is the subject of an
investigation, proceeding, action or claim and there exists no state of facts
which after notice or lapse of time or both would reasonably be expected to give
rise to any such proceeding, action or claim.
     8.10 Bank Accounts. All of the deposit accounts, investment accounts or
other accounts in the name of or used by any Borrower or Guarantor maintained at
any bank or other financial institution are set forth on Schedule 8.10 to the
Information Certificate, subject to the right of each Borrower and Guarantor to
establish new accounts in accordance with Section 5.2 hereof.
     8.11 Intellectual Property. Each Borrower and Guarantor owns or licenses or
otherwise has the right to use all Intellectual Property necessary for the
operation of its business. As of the date hereof, Borrowers and Guarantors do
not have any material Intellectual Property registered, or subject to pending
applications, in the United States Patent and Trademark Office or any similar
office or agency in the United States, any State thereof, any political
subdivision thereof, other than those described in Schedule 8.11 to the
Information Certificate and has not granted any licenses with respect thereto
other than as set forth in Schedule 8.11 to the Information Certificate. No
event has occurred which permits or would permit after notice or passage of time
or both, the revocation, suspension or termination of such rights. To the best
of any Borrower’s and Guarantor’s knowledge, no slogan or other advertising
device, product, process, method, substance or other Intellectual Property or
goods bearing or using any Intellectual Property presently contemplated to be
sold by or employed by any Borrower or Guarantor infringes any patent,
trademark, servicemark, tradename, copyright, license or other Intellectual
Property owned by any other Person presently where such infringement has or
would reasonably be expected to have Material Adverse Effect or adversely affect
the ability of any Borrower to sell or otherwise dispose of Inventory having a
value in excess of $500,000. No claim or litigation is pending or threatened in
writing against or affecting any Borrower or Guarantor contesting its right to
sell or use any such Intellectual Property where such claim or litigation if
adversely determined for any Borrower or Guarantor would reasonably be expected
to have a Material Adverse Effect or would adversely affect the ability of any
Borrower to sell or otherwise dispose of Inventory having a value in excess of
$500,000. Schedule 8.11 to the Information Certificate sets forth all of the
material agreements or other arrangements of each Borrower and Guarantor
pursuant to which such Borrower or Guarantor has a license or other right to use
any trademarks, logos, designs, representations or other Intellectual Property
owned by another person as in effect on the date hereof and the dates of the
expiration of such agreements or other arrangements of such Borrower or
Guarantor as in effect on the date hereof which is necessary or of material
value to such Borrower’s or Guarantor’s business (collectively, together with
such agreements or other arrangements as may be entered into by any Borrower or
Guarantor after the date hereof, collectively, the “License Agreements” and
individually, a “License Agreement”). No material trademark, servicemark,
copyright or other material Intellectual Property at any time used by any
Borrower or Guarantor which is owned by another person, or owned by such
Borrower or Guarantor subject to any security interest, lien, collateral
assignment, pledge or other encumbrance in favor of any person other than Agent,
is affixed to or incorporated in any Eligible Inventory, except (a) to the
extent permitted under the term of the license agreements listed on
Schedule 8.11 to the Information Certificate and (b) to the extent the sale of
Inventory to which such Intellectual Property is affixed or incorporated is
permitted to be sold by such Borrower or Guarantor under applicable law
(including the United States Copyright Act of 1976).

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     8.12 Subsidiaries; Affiliates; Capitalization; Solvency.
          (a) Each Borrower and Guarantor does not have any direct or indirect
Subsidiaries or Affiliates and is not engaged in any joint venture or
partnership as of the date hereof except as set forth in Schedule 8.12 to the
Information Certificate.
          (b) As of the date hereof, each Borrower and Guarantor is the record
and beneficial owner of all of the issued and outstanding shares of Equity
Interests of each of the Subsidiaries listed on Schedule 8.12 to the Information
Certificate as being owned by such Borrower or Guarantor and there are no
proxies, irrevocable or otherwise, with respect to such shares and no equity
securities of any of the Subsidiaries are or may become required to be issued by
reason of any options, warrants, rights to subscribe to, calls or commitments of
any kind or nature and there are no contracts, commitments, understandings or
arrangements by which any Subsidiary is or may become bound to issue additional
shares of its Equity Interests or securities convertible into or exchangeable
for such shares.
          (c) The issued and outstanding shares of Equity Interests of each
Borrower and Guarantor are directly and beneficially owned and held by the
persons indicated in the Information Certificate, and in each case all of such
shares have been duly authorized and are fully paid and non-assessable, free and
clear of all claims, liens, pledges and encumbrances of any kind, except as
disclosed in writing to Agent prior to the date hereof or otherwise permitted
hereunder.
          (d) Borrowers and Guarantors (on a consolidated basis) shall be
Solvent as of the date hereof after the creation of the Obligations, the
security interests of Agent and the other transaction contemplated hereunder.
     8.13 Labor Disputes.
          (a) Set forth on Schedule 8.13 to the Information Certificate is a
list (including dates of termination) of all collective bargaining or similar
agreements between or applicable to each Borrower and Guarantor and any union,
labor organization or other bargaining agent in respect of the employees of any
Borrower or Guarantor on the date hereof.
          (b) Except as set forth on Schedule 8.13 to the Information
Certificate, there is (i) no significant unfair labor practice complaint pending
against any Borrower or Guarantor or, to the best of any Borrower’s or
Guarantor’s knowledge, threatened in writing against it, before the National
Labor Relations Board, and no significant grievance or significant arbitration
proceeding arising out of or under any collective bargaining agreement is
pending on the date hereof against any Borrower or Guarantor or, to best of any
Borrower’s or Guarantor’s knowledge, threatened against it, and (ii) no
significant strike, labor dispute, slowdown or stoppage is pending against any
Borrower or Guarantor or, to the best of any Borrower’s or Guarantor’s
knowledge, threatened against any Borrower or Guarantor.
     8.14 Restrictions on Subsidiaries. Except for restrictions contained in
this Agreement or any other agreement with respect to Indebtedness of any
Borrower or Guarantor permitted hereunder as in effect on the date hereof, there
are no contractual or consensual restrictions on any Borrower or Guarantor or
any of its Subsidiaries which prohibit or otherwise restrict (a) the transfer of
cash or other assets (i) between any Borrower or Guarantor and any of its or
their Subsidiaries or (ii) between any Subsidiaries of any Borrower or Guarantor
or (b) the ability of any Borrower or Guarantor or any of its or their
Subsidiaries to incur Indebtedness or grant security interests to Agent or any
Lender in the Collateral except as permitted under Section 10.10 hereof.

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     8.15 Material Contracts; Affiliate Indebtedness.
          (a) Schedule 8.15 to the Information Certificate sets forth all
Material Contracts to which any Borrower or Guarantor is a party or is bound as
of the date hereof. Borrowers and Guarantors have delivered true, correct and
complete copies of such Material Contracts to Agent on or before the date
hereof. Borrowers and Guarantors are not in breach or in default in any material
respect of or under any Material Contract and have not received any notice of
the intention of any other party thereto to terminate any Material Contract.
          (b) Each Borrower and Guarantor represents and warrants that is not
and shall not at any time have any liability under or with respect to the
obligations of its Affiliates pursuant to the Holdings I Notes, the other
Holdings I Documents, the Holdings II Notes or the other Holdings II Documents.
          (c) As of the date hereof, no Borrower or Guarantor is party to any
License Agreement that is a Material Contract.
     8.16 Payable Practices. Each Borrower and Guarantor has not made any
material change in its customary accounts payable practices from those in effect
immediately prior to the date hereof.
     8.17 Accuracy and Completeness of Information. All information furnished by
or on behalf of any Borrower or Guarantor in writing to Agent or any Lender in
connection with this Agreement or any of the other Loan Documents or any
transaction contemplated hereby or thereby, when taken as a whole, including all
information on the Information Certificate is true and correct in all material
respects on the date as of which such information is dated or certified and does
not omit any material fact necessary in order to make such information, when
taken as a whole, not misleading.
     8.18 Survival of Warranties; Cumulative. All representations and warranties
contained in this Agreement or any of the other Loan Documents shall survive the
execution and delivery of this Agreement and shall be deemed to have been made
again to Agent, Lenders and Issuing Bank on the date of the request for any Loan
or any issuance, amendment, renewal or extension of a Letter of Credit and on
the date of each additional Loan or such issuance, amendment, renewal or
extension, except to the extent that such representations and warranties
expressly relate solely to an earlier date (in which case such representations
and warranties shall have been true and accurate on and as of such earlier date)
and shall be conclusively presumed to have been relied on by Agent and Lenders
regardless of any investigation made or information possessed by Agent or any
Lender. The representations and warranties set forth herein shall be cumulative
and in addition to any other representations or warranties which any Borrower or
Guarantor shall now or hereafter give, or cause to be given, to Agent or any
Lender.
SECTION 9. AFFIRMATIVE COVENANTS
     9.1 Maintenance of Existence.
          (a) Each Borrower and Guarantor shall (i) at all times preserve, renew
and keep in full force and effect its corporate or limited liability company
existence and rights and franchises with respect thereto and (ii) maintain in
full force and effect all licenses, trademarks, tradenames, approvals,
authorizations, leases, contracts and Permits necessary to carry on the business
as presently or proposed to be conducted, except as to any Guarantor other than
Parent as permitted in Section 10.1 hereof or except where the failure to so
maintain could not be reasonably expected to have a Material Adverse Effect.

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          (b) No Borrower or Guarantor shall change its name unless each of the
following conditions is satisfied: (i) Agent shall have received not less than
thirty (30) days’ prior written notice (or such shorter time as Agent may agree
in writing) from Administrative Borrower of such proposed change in its
corporate name, which notice shall accurately set forth the new name; and
(ii) Agent shall have received a copy of the amendment to the certificate of
incorporation, certificate of formation or other organizational document of such
Borrower or Guarantor providing for the name change certified by the Secretary
of State of the jurisdiction of incorporation or organization of such Borrower
or Guarantor as soon as it is available.
          (c) No Borrower or Guarantor shall change its chief executive office
or its mailing address or organizational identification number (or if it does
not have one, shall not acquire one) unless Agent shall have received not less
than thirty (30) days’ prior written notice (or such shorter time as Agent may
agree in writing) from Administrative Borrower of such proposed change, which
notice shall set forth such information with respect thereto as Agent may
reasonably require and Agent shall have received such agreements as Agent may
reasonably require in connection therewith. No Borrower or Guarantor shall
change its type of organization, jurisdiction of organization or other legal
structure; except, that, a Borrower, Guarantor or Subsidiary may convert (either
directly or by way of merger) into a limited liability company or limited
partnership or other form of legal entity acceptable to Agent; provided, that,
each of the following conditions is satisfied: (i) such company, partnership or
other legal entity is organized under the laws of a jurisdiction in the United
States of America, or Canada (ii) Agent shall have received not less than
fifteen (15) days’ prior written notice from Administrative Borrower of such
proposed change, which notice shall accurately set forth a description of the
new form, (iii) Agent shall have received the organizational documents of such
entity (certified by the appropriate Governmental Authority, where available to
be so certified), together with such other agreements, documents, and
instruments related thereto as Agent may reasonably request, (iv) such change
shall not adversely affect the security interests and liens of Agent in the
assets of such Borrower or Guarantor or the ability of Agent to enforce any of
its rights or remedies with respect to such Borrower or Guarantor, in the
determination of Agent and (v) as of the date of such conversion, and after
giving effect thereto, no Default or Event of Default shall exist or have
occurred and be continuing.
     9.2 New Collateral Locations. Each Borrower and Guarantor may only open any
new location so long as (a) such locations are within the United States or its
territories or Canada, (b) such location is set forth in the applicable report
provided for in Section 7.1(a) to the extent required under such Section or in
any event if Collateral having a value of more than $1,000,000 at any one
location or $5,000,000 for all such locations in the aggregate is or will be
kept at such location(s), Agent has received ten (10) Business Days’ written
notice within the time of the opening of any such new location and (c) upon
Agent’s request, such Borrower or Guarantor executes and delivers, or causes to
be executed and delivered, to Agent such agreements, documents, and instruments
as Agent may deem reasonably necessary or desirable to protect its interests in
the Collateral at such location; provided, that, so long as no Event of Default
exists or has occurred and is continuing, upon Agent’s request, Borrowers and
Guarantors shall only be required to use their commercially reasonable efforts
to obtain a Collateral Access Agreement and to the extent that Agent has not
received a Collateral Access Agreement acceptable to it for any such location,
it may establish a Reserve as provided herein.
     9.3 Compliance with Laws, Regulations, Etc.
          (a) Each Borrower and Guarantor shall, and shall cause any Subsidiary
to, at all times, comply in all respects with all laws, rules, regulations,
licenses, approvals, orders and other Permits applicable to it and duly observe
all requirements of any foreign, Federal, State, Provincial or local
Governmental Authority where the failure to do so has or could reasonably be
expected to have a Material Adverse Effect.

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          (b) Borrowers and Guarantors shall give written notice to Agent
promptly upon any Borrower’s or Guarantor’s receipt of any notice of, or any
Borrower’s or Guarantor’s otherwise obtaining knowledge of, (i) the occurrence
of any event involving the threatened or actual release, spill or discharge, of
a material amount of any Hazardous Material that has or would reasonably be
expected to have a Material Adverse Effect or (ii) any investigation,
proceeding, complaint, order, directive, claims, citation or notice that with
respect to any of the following that has or would reasonably be expected to have
a Material Adverse Effect: (A) any non-compliance with or violation of any
Environmental Law by any Borrower or Guarantor or (B) the release, spill or
discharge of any Hazardous Material other than in the ordinary course of
business and other than as permitted under any applicable Environmental Law.
Copies of all environmental surveys, audits, assessments, feasibility studies
and results of remedial investigations shall be promptly furnished, or caused to
be furnished, by such Borrower or Guarantor to Agent upon Agent’s request. Each
Borrower and Guarantor shall take prompt action to respond to any material
non-compliance with any of the Environmental Laws and shall regularly report to
Agent on such response.
          (c) Without limiting the generality of the foregoing, whenever Agent
reasonably determines that there is material non-compliance, or any condition
which requires action by or on behalf of any Borrower or Guarantor in order to
avoid any material non-compliance, with any Environmental Law, Borrowers shall,
at Agent’s request and Borrowers’ expense: (i) cause an independent
environmental engineer reasonably acceptable to Agent to conduct such tests of
the site where non-compliance or alleged non-compliance with such Environmental
Laws has occurred as to such non-compliance and prepare and deliver to Agent a
report as to such non-compliance setting forth the results of such tests, a
proposed plan for responding to any environmental problems described therein,
and an estimate of the costs thereof and (ii) provide to Agent a supplemental
report of such engineer whenever the scope of such non-compliance, or such
Borrower’s or Guarantor’s response thereto or the estimated costs thereof, shall
change in any material respect.
          (d) Each Borrower and Guarantor shall indemnify and hold harmless
Agent and Lenders and their respective directors, officers, employees, agents,
invitees, representatives, successors and assigns, from and against any and all
losses, claims, damages, liabilities, costs, and expenses (including reasonable
attorneys’ fees and expenses) directly or indirectly arising out of or
attributable to the use, generation, manufacture, production, storage, release,
threatened release, spill, discharge, disposal or presence of a Hazardous
Material, including the costs of any required or necessary repair, cleanup or
other remedial work with respect to effected property and the preparation and
implementation of any closure, remedial or other plans required pursuant to
Environmental Law. All representations, warranties, covenants and
indemnifications in this Section 9.3 shall survive the payment of the
Obligations and the termination of this Agreement.
     9.4 Payment of Taxes and Claims. Each Borrower and Guarantor shall, and
shall cause any Subsidiary to, duly pay and discharge all taxes, assessments,
contributions and governmental charges upon or against it or its properties or
assets, except for taxes the validity of which is being contested in good faith
by appropriate proceedings diligently pursued and available to such Borrower,
Guarantor or Subsidiary, as the case may be, and with respect to which adequate
reserves have been set aside on its books to the extent required by GAAP.
     9.5 Insurance. Each Borrower and Guarantor shall, and shall cause any
Subsidiary to, at all times, maintain with financially sound and reputable
insurers insurance with respect to the Collateral against loss or damage and all
other insurance of the kinds and in the amounts customarily insured against or
carried by corporations of established reputation engaged in the same or similar
businesses and similarly situated. Said policies of insurance shall be
reasonably satisfactory to Agent as to form, amount and insurer (provided, that,
Borrowers and Guarantors may maintain self insurance plans to the extent

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companies of the same or similar businesses and similarly situated do so).
Borrowers and Guarantors shall furnish certificates, policies or endorsements to
Agent as Agent shall reasonably request as proof of such insurance, and, Agent
is authorized, but not required, to obtain such insurance at the expense of
Borrowers if any Borrower or Guarantor fails at any time to do so. All policies
shall provide for at least thirty (30) days prior written notice to Agent of any
cancellation or reduction of coverage. Agent may act as attorney for each
Borrower and Guarantor in obtaining, and at any time an Event of Default exists
or has occurred and is continuing, adjusting, settling, amending and canceling
such insurance. Borrowers and Guarantors shall cause Agent to be named as a loss
payee as its interests may appear and an additional insured (but without any
liability for any premiums) under such insurance policies and Borrowers and
Guarantors shall obtain non-contributory lender’s loss payable endorsements to
all insurance policies in form and substance satisfactory to Agent. Such
lender’s loss payable endorsements shall specify that the proceeds of such
insurance shall be payable to Agent as its interests may appear and further
specify that Agent and Lenders shall be paid regardless of any act or omission
by any Borrower, Guarantor or any of its or their Affiliates. Without limiting
any other rights of Agent or Lenders, any insurance proceeds received by Agent
or proceeds of condemnation awards payable at any time may be applied to payment
of the Obligations (without permanent reduction thereof), whether or not then
due, in any order and in such manner as Agent may determine; provided, that,
proceeds of insurance of less than $2,500,000 in the aggregate may be paid to
Administrative Borrower so long as no Cash Dominion Event exists and such
proceeds are used for the costs of repair or replacement of the Collateral lost
or damages resulting in the payment of such insurance proceeds. Upon application
of any other such proceeds to the Revolving Loans, Revolving Loans may be
available subject and pursuant to the terms hereof to be used for the costs of
repair or replacement of the Collateral lost or damages resulting in the payment
of such insurance proceeds. No Equipment or Real Property repaired or replaced
pursuant to the terms hereof shall constitute Eligible Equipment or Eligible
Real Property unless Agent determines pursuant to and in accordance with the
terms of this Agreement that such Equipment and/or Real Property satisfies the
applicable eligibility criteria therefor.
     9.6 Financial Statements and Other Information.
          (a) Each Borrower and Guarantor shall, and shall cause any Subsidiary
to, keep proper books and records in which true and complete entries shall be
made of all dealings or transactions of or in relation to the Collateral and the
business of such Borrower, Guarantor and its Subsidiaries in accordance with
GAAP. Borrowers and Guarantors shall during regular business hours and upon
reasonable notice from the Agent furnish to Agent and upon Agent’s request, to
Lenders, all such financial and other information as Agent shall reasonably
request relating to the Collateral and the assets, business and operations of
Borrowers and Guarantors, and Borrower shall notify the auditors and accountants
of Borrowers and Guarantors that Agent is authorized, acting jointly with
Administrative Borrower, to obtain such information directly from them (other
than materials protected by the attorney-client privilege) at any reasonable
time, which Agent agrees it will not directly request from such auditors or
accountants unless a Default or Event of Default exists or has occurred and is
continuing. Without limiting the foregoing, Borrowers shall furnish or cause to
be furnished to Agent, and upon Agent’s request, to each Lender, the following:
               (i) as soon as available, but in any event within thirty
(30) days after the end of each fiscal month other than December (and as of the
date that is forty-five (45) days after the end of each December) that is not
the end of a fiscal quarter of Parent, monthly unaudited consolidated financial
statements and unaudited consolidating (as between (A) US Borrowers and
Guarantors and (B) Canadian Borrowers and Guarantors) financial statements
(including in each case, balance sheets, statements of income and loss,
statement of cash flow, and statements of shareholders equity), all in
reasonable detail (but without footnotes), fairly presenting in all material
respects the financial position and the results of the operations of Parent and
its Subsidiaries as of the end of and through such fiscal month, subject to
normal year-end adjustments; and

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(ii) as soon as available, but in any event within forty-five (45) days after
the end of each of the first three fiscal quarters of each fiscal year of
Parent, quarterly unaudited consolidated financial statements and unaudited
consolidating (as between (A) US Borrowers and Guarantors and (B) Canadian
Borrowers and Guarantors) financial statements (including in each case balance
sheets, statements of income and loss, statements of cash flow, and statements
of shareholders’ equity), all in reasonable detail, fairly presenting in all
material respects the financial position and the results of the operations of
Parent and its Subsidiaries as of the end of and through such fiscal quarter,
subject to normal year-end adjustments; and
(iii) within ninety (90) days after the end of each fiscal year, audited
consolidated financial statements and unaudited consolidating (as between (A) US
Borrowers and Guarantors and (B) Canadian Borrowers and Guarantors) financial
statements of Parent and its Subsidiaries (including in each case balance
sheets, statements of income and loss, statements of cash flow and statements of
shareholders’ equity), and the accompanying notes thereto, all in reasonable
detail, fairly presenting in all material respects the financial position and
the results of the operations of Parent and its Subsidiaries as of the end of
and for such fiscal year.
          (b) Borrowers and Guarantors shall promptly notify Agent in writing of
the details of (i) any loss, damage, investigation, action, suit, proceeding or
claim relating to Collateral having a value of more than $1,000,000 or which if
adversely determined would result in any material adverse change in any
Borrower’s or Guarantor’s business, properties, assets, goodwill or condition,
financial or otherwise, (ii) any Material Contract being terminated or amended
or any new Material Contract entered into (in which event Borrowers and
Guarantors shall provide Agent with a copy of such Material Contract), (iii) any
order, judgment or decree in excess of $1,000,000 shall have been entered
against any Borrower or Guarantor any of its or their properties or assets,
(iv) any notification of a material violation of laws or regulations received by
any Borrower or Guarantor, (v) any ERISA Event, and (vi) the occurrence of any
Default or Event of Default.
          (c) Borrowers and Guarantors shall furnish to Agent (i) not less than
ten (10) Business Days’ prior written notice of (A) the intention of any
Subsidiaries of Parent to merge or consolidate as permitted under
Section 10.1(a) hereof, together with such other information with respect
thereto as Agent may reasonably request, (B) the issuance and sale by Parent or
any Subsidiary of Equity Interests as permitted under clause (g) of the
definition of Permitted Dispositions, together with such other information with
respect thereto as Agent may reasonably request, (C) the intention of any
Subsidiary of Parent to wind up, liquidate or dissolve as permitted under
Section 10.1(c) hereof, together with such other information with respect
thereto as Agent may reasonably request, and (ii) all notices or demands in
connection with such Indebtedness either received by any Borrower or Guarantor
or on its behalf promptly after the receipt thereof, or sent by any Borrower or
Guarantor or on its behalf concurrently with the sending thereof, as the case
may be.
          (d) Borrowers and Guarantors shall furnish to Agent, and upon Agent’s
reasonable request, to each Lender, in form and detail reasonably satisfactory
to Agent:
               (i) concurrently with the delivery of the financial statements
referred to in Section 9.6(a)(iii), the unqualified opinion of independent
certified public accountants with respect to the audited consolidated financial
statements, which independent accounting firm shall be selected by
Administrative Borrower and reasonably acceptable to Agent, that such audited
consolidated financial statements have been prepared in accordance with GAAP,
and present fairly in all material respects the

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results of operations and financial condition of Parent and its Subsidiaries as
of the end of and for the fiscal year then ended and stating, to the extent not
prohibited by the internal procedures and policies of such accountants, that in
making the examination necessary therefor no knowledge was obtained of any
Default or Event of Default, or if any such Default or Event of Default shall
exist, stating the nature and status of such event;
               (ii) concurrently with the delivery of the financial statements
referred to in Sections 9.6(a)(ii) and 9.6(a)(iii), a management discussion and
analysis (in substantially the same format and with the same scope of
information as provided to Agent prior to the date hereof) in the event Parent
and its consolidated Subsidiaries are not then required to submit regular
reports to the U.S. Securities and Exchange Commission, a compliance certificate
substantially in the form of Exhibit E hereto by the chief financial officer,
vice president of finance, treasurer or controller of Administrative Borrower on
behalf of Borrowers and Guarantors, along with a schedule in form reasonably
satisfactory to Agent of the calculations used in determining, as of the end of
such month, the ratio and amounts provided for in Section 11 of this Agreement
for such month (whether or not compliance is then required) and a written
summary of material changes if any, either in GAAP or in the consistent
application thereof that materially affected the financial covenant calculations
for the applicable period;
               (iii) within sixty (60) days after the end of each fiscal year of
Parent, beginning with the fiscal year 2008 of Parent and its Subsidiaries,
projected consolidated and consolidating (as between (A) US Borrowers and
Guarantors and (B) Canadian Borrowers and Guarantors) financial statements
(including in each case substantially in the same format and with the same scope
of information as in the projections most recently provided to Agent prior to
the date hereof) of Parent and its Subsidiaries for the next fiscal year, all in
reasonable detail, and in a format consistent with the projections delivered by
Borrowers to Agent prior to the date hereof, together with such supporting
information as Agent may reasonably request, which projected financial
statements shall be prepared on a monthly basis for the next succeeding year and
shall represent the reasonable best estimate by Borrowers and Guarantors of the
future financial performance of Parent and its Subsidiaries for the periods set
forth therein and shall have been prepared on the basis of the assumptions set
forth therein believed by the Parent to be reasonable at the time made and fair
in light of the then current conditions and facts(it being understood that
actual results may differ from those set forth in such projected financial
statements);
               (iv) promptly after the same are available, copies of each annual
report, proxy or annual or quarterly financial statement or other report or
communication sent generally to the equity holders of any Borrower or Guarantor,
and copies of all annual, regular, periodic and special reports and registration
statements which, in each case, a Borrower or Guarantor may file or be required
to file with the Securities and Exchange Commission under Section 13 or 15(d) of
the Exchange Act, and not otherwise required to be delivered to Agent pursuant
hereto;
               (v) concurrently with the delivery of the financial statements
referred to in Sections 9.6(a)(i) and 9.6(a)(ii), a certificate by the chief
financial officer, vice president of finance, treasurer or controller of
Administrative Borrower on behalf of Borrowers and Guarantors containing
information regarding the amount of all sales or other dispositions of assets
(whether voluntary or involuntary), issuances or incurrence of Indebtedness or
Equity Interests, Permitted Investments, Restricted Payments, and optional
prepayments of Indebtedness that occurred during the period covered by such
financial statements and such other information with respect thereto as Agent
may request;
               (vi) promptly after any request by Agent, copies of any
management letters submitted to the board of directors (or the audit committee
of the board of directors) of Parent by independent accountants in connection
with the accounts or books of Parent or any Subsidiary, or any audit of any of
them;

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               (vii) promptly, and in any event within five (5) Business Days
after receipt thereof by any Borrower or Guarantor or any Subsidiary thereof,
copies of each notice or other correspondence received from the Securities and
Exchange Commission (or comparable agency in any applicable non-U.S.
jurisdiction) concerning any investigation or possible investigation or other
inquiry by such agency regarding financial or other operational results of
Parent or any Subsidiary thereof;
               (viii) promptly after any request of the Agent following the
delivery of the financial statements referred to in Sections 9.6(a)(i) and
9.6(a)(ii), a certificate by the chief executive officer, chief financial
officer, vice president of finance, treasurer or controller of Administrative
Borrower on behalf of Borrowers and Guarantors attaching the insurance binder or
other evidence of insurance for any insurance coverage of Borrowers, Guarantors
or any Subsidiary that was renewed, replaced or modified during the period
covered by such financial statements.
          (e) As to any information contained in materials furnished pursuant to
Section 9.6(d)(iv), Parent shall not be separately required to furnish such
information under Section 9.6(a) hereof, but the foregoing shall not be in
derogation of the obligation of Parent to furnish the information and materials
described in Section 9.6(a) at the times specified therein.
          (f) Documents required to be delivered pursuant to Section 9.6(a)(iii)
or Section 9.6(d)(iv) (to the extent any such documents are included in
materials otherwise filed with the Securities and Exchange Commission may be
delivered electronically and if so delivered, shall be deemed to have been
delivered on the date on which such documents are posted on a Borrower’s behalf
on an Internet or intranet website, if any, to which each Lender and Agent has
access (whether commercial, third-party website or whether sponsored by Agent).
          (g) Borrowers and Guarantors hereby acknowledge that Agent and/or its
Affiliates may make available to Lenders and Issuing Bank materials and/or
information provided by or on behalf of Borrowers hereunder (collectively,
“Borrower Materials”) by posting the Borrower Materials on IntraLinks, Syndtrak,
or another similar electronic system (the “Platform”) and certain of the Lenders
may be “public-side” Lenders (i.e., Lenders that do not wish to receive material
non-public information with respect to Borrowers, Guarantors or their
securities) (each, a “Public Lender”). Borrowers and Guarantors shall be deemed
to have authorized Agent and its Affiliates, and the Lenders to treat Borrower
Materials marked “PUBLIC” or otherwise at any time filed with the Securities and
Exchange Commission as not containing any material non-public information with
respect to Borrowers, Guarantors or their securities for purposes of United
States federal and state securities laws (provided, however, that to the extent
such Borrower Materials constitute Information, they shall be treated as set
forth in Section 15.5). All Borrower Materials marked “PUBLIC” are permitted to
be made available through a portion of the Platform designated as “Public
Investor.” Agent and its Affiliates and Lenders shall be entitled to treat any
Borrower Materials that are not marked “PUBLIC” or that are not at any time
filed with the Securities and Exchange Commission as being suitable only for
posting on a portion of the Platform not marked as “Public Investor.”
          (h) not less than ten (10) days prior to each proposed date of the
making of an Opco Permitted Payment, the chief financial officer of Associated
Materials, LLC shall deliver to Agent a certification that as of the date of
such certification, and as of the date of the proposed payment and after giving
effect thereto, no Event of Default shall exist or have occurred and be
continuing, it being understood that if after giving effect to any such Opco
Permitted Payment, US Excess Availability would be less than twelve and one-half
(12 1/2%) percent of the US Loan Limit, Canadian Excess Availability would be
less than twelve and one-half (12 1/2%) percent of the Canadian Loan Limit, or
Global Excess Availability would be less than twelve and one-half (12 1/2%)
percent of the Maximum Credit, then the absence of an Event of Default shall
include, without limitation, that the Fixed Charge Coverage Ratio of Parent and
its Subsidiaries (on a consolidated basis) determined as of the end of the
fiscal month most recently ended for which Agent has received financial
statements shall be not less than 1.10 to 1.0 for the period of the immediately
preceding twelve (12) consecutive fiscal months prior to such fiscal month end.

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               (i) Borrowers and Guarantors shall furnish or cause to be
furnished to Agent such other information respecting the Collateral and the
business of Borrowers and Guarantors, as Agent may, from time to time,
reasonably request. Agent is hereby authorized to deliver a copy of any
financial statement or any other information relating to the business of
Borrowers and Guarantors to any court or other Governmental Authority or to any
Lender or Participant or prospective Lender or Participant or any Affiliate of
any Lender or Participant subject to Section 15.5 hereof. Any documents,
schedules, invoices or other papers delivered to Agent or any Lender may be
destroyed or otherwise disposed of by Agent or such Lender one (1) year after
the same are delivered to Agent or such Lender, except as otherwise designated
by Administrative Borrower to Agent or such Lender in writing.
     9.7 Compliance with ERISA; Canadian Pension Plans.
          (a) Each Borrower and Guarantor shall, and shall cause each of its
ERISA Affiliates to: (i) maintain each Plan in compliance with the applicable
provisions of ERISA, the Code and other Federal and State law; (ii) cause each
Plan which is qualified under Section 401(a) of the Code to maintain such
qualification; (iii) not terminate any Pension Plan so as to incur any material
liability to the Pension Benefit Guaranty Corporation; (iv) not allow or suffer
to exist any prohibited transaction involving any Plan or any trust created
thereunder which would subject such Borrower, Guarantor or such ERISA Affiliate
to a material tax or other material liability on prohibited transactions imposed
under Section 4975 of the Code or ERISA; (v) make all required contributions to
any Plan which it is obligated to pay under Section 302 of ERISA, Section 412 of
the Code or the terms of such Plan; (vi) not allow or suffer to exist any
accumulated funding deficiency, whether or not waived, with respect to any such
Pension Plan; (vii) not engage in a transaction that could be subject to
Section 4069 or 4212(c) of ERISA; or(viii) not allow or suffer to exist any
occurrence of a reportable event or any other event or condition which would
reasonably be expected to result in termination by the Pension Benefit Guaranty
Corporation of any Plan that is a single employer plan, which termination could
result in any material liability to the Pension Benefit Guaranty Corporation.
          (b) Each Borrower and Guarantor shall (i) cause the Canadian Pension
Plans to be administered in accordance with the requirements of the applicable
pension plan texts, funding agreements, the Income Tax Act (Canada) and
applicable provincial pension benefits legislation, (ii) deliver to Agent an
undertaking of the funding agent for such Canadian Pension Plan stating that the
funding agent will notify Agent within seven (7) days of the failure of any
Borrower or US Guarantor to make any required contribution to each Canadian
Pension Plan, (iii) not accept payment of any amount from any Canadian Pension
Plan (other than amounts on account of expenses reasonably incurred in
connection with the operations of such Canadian Pension Plan) without the prior
written consent of Agent, (iv) not terminate, or cause to be terminated, any
Canadian Pension Plan, if such plan would have a solvency deficiency on
termination, (v) shall promptly provide Agent with any documentation relating to
the Canadian Pension Plans as Agent may reasonably request, and (vi) shall
notify Agent within thirty (30) days of (A) a material increase in the
liabilities of any Canadian Pension Plan, (B) the establishment of a new
registered pension plan or (C) the commencement of payments of contributions to
any Canadian Pension Plan to which any Borrower or Guarantor had not previously
been paying or contributing.
     9.8 End of Fiscal Years; Fiscal Quarters. Each Borrower and Guarantor
shall, for financial reporting purposes, cause its, and each of its
Subsidiaries’ to continue to operate on a 52/53 week fiscal year that ends on
the Saturday closest to December 31 and, for each fiscal year, after the fiscal
year end has been determined (which determines whether the fiscal year will be
52 or 53 weeks), determine fiscal month ends on a 5/4/4 calendar (with each
fiscal month ending on Saturday).

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     9.9 Additional Guaranties and Collateral Security; Further Assurances.
          (a) In the case of the formation or acquisition by a Borrower or
Guarantor of any Subsidiary after the date hereof (other than a Foreign
Subsidiary), as to any such Subsidiary, (i) the Borrower or Guarantor forming
such Subsidiary shall cause any such Subsidiary to execute and deliver to Agent,
in form and substance satisfactory to Agent, a joinder agreement to the Loan
Documents in order to make such Subsidiary a party to this Agreement as a
“Borrower” if it owns accounts or inventory that would constitute Eligible
Accounts and Eligible Inventory or otherwise as a “Guarantor”, and a party to
any guarantee as a “Guarantor” or pledge agreement as a “Pledgor”, and
including, but not limited to, supplements and amendments hereto and to any of
the other Loan Documents, authorization to file UCC and PPSA financing
statements, Collateral Access Agreements (to the extent required under
Section 9.2), other agreements, documents or instruments contemplated under
Section 5.3 and other consents, waivers, acknowledgments and other agreements
from third persons which Agent may deem reasonably necessary or desirable in
order to permit, protect and perfect its security interests in and liens upon
the assets of such Subsidiary and the Equity Interests of any Borrower or
Guarantor in such Subsidiary, corporate resolutions and other organization and
authorizing documents of such Person, and favorable opinions of counsel to such
person and (ii) the Borrower or Guarantor forming such Subsidiary shall execute
and deliver to Agent, a pledge and security agreement, in form and substance
satisfactory to Agent, granting to Agent a first pledge of and lien on all of
the issued and outstanding shares of Equity Interests of any such Subsidiary,
and otherwise comply with the terms of Section 5.3 hereof with respect thereto,
such other agreements, documents and instruments as Agent may require in
connection with the documents referred to above, including, but not limited to,
supplements and amendments hereto, corporate resolutions and other organization
and authorizing documents and favorable opinions of counsel to such person.
          (b) In the case of an acquisition of assets (other than Equity
Interests) by a Borrower or Guarantor after the date hereof, Agent shall have
received, in form and substance satisfactory to Agent, (i) evidence that Agent
has valid and perfected security interests in and liens upon all purchased
assets to the extent such assets constitute Collateral hereunder (except in the
case of deposit accounts, within thirty (30) days after the acquisition thereof;
provided, that, in no event shall any such assets consisting of Accounts or
Inventory so purchased be deemed to be Eligible Accounts or Eligible Inventory
until Agent is perfected in such deposit accounts, except as Agent may otherwise
agree), (ii) except as Agent may otherwise agree, all Collateral Access
Agreements (to the extent required under Section 9.2 hereof) and other consents,
waivers, acknowledgments and other agreements from third persons which Agent may
deem necessary or desirable in order to permit, protect and perfect its security
interests in and liens upon the assets purchased, and (iii) such other
agreements, documents and instruments as Agent may require in connection with
the documents referred to above, including, but not limited to, supplements and
amendments hereto, corporate resolutions and other organization and authorizing
documents and favorable opinions of counsel to such person.
          (c) At the request of Agent at any time and from time to time,
Borrowers and Guarantors shall, at their expense, duly execute and deliver, or
cause to be duly executed and delivered, such further agreements, documents and
instruments, and do or cause to be done such further acts as may be necessary or
proper to evidence, perfect, maintain and enforce the security interests and the
priority thereof in the Collateral and to otherwise effectuate the provisions or
purposes of this Agreement or any of the other Loan Documents.

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     9.10 Costs and Expenses. Borrowers and Guarantors shall pay to Agent on
demand all reasonable out-of-pocket costs, expenses, filing fees and taxes paid
or payable in connection with the preparation, negotiation, execution, delivery,
recording, syndication, administration, collection, liquidation, enforcement and
defense of the Obligations, Agent’s rights in the Collateral, this Agreement,
the other Loan Documents and all other documents related hereto or thereto,
including any amendments, supplements or consents which may hereafter be
contemplated (whether or not executed) or entered into in respect hereof and
thereof, including: (a) all costs and expenses of filing or recording (including
UCC and PPSA financing statement filing taxes and fees, documentary taxes,
intangibles taxes and mortgage recording taxes and fees, if applicable),
(b) costs and expenses and fees for insurance premiums, environmental audits and
site assessments, title insurance premiums, surveys, assessments, engineering
reports and inspections, appraisal fees and search fees, background checks,
costs and expenses of remitting loan proceeds, collecting checks and other items
of payment, and establishing and maintaining the Concentration Accounts,
together with Agent’s customary charges and fees with respect thereto;
(c) charges, fees or expenses charged by any Issuing Bank in connection with any
Letter of Credit; (d) costs and expenses of preserving and protecting the
Collateral; (e) costs and expenses paid or incurred in connection with obtaining
payment of the Obligations, enforcing the security interests and liens of Agent
in the Collateral, selling or otherwise realizing upon the Collateral, and
otherwise enforcing the provisions of this Agreement and the other Loan
Documents or defending any claims made or threatened against Agent or any Lender
arising out of the transactions contemplated hereby and thereby (including
preparations for and consultations concerning any such matters); (f) all
out-of-pocket expenses and costs heretofore and from time to time hereafter
incurred by Agent during the course of periodic field examinations of the
Collateral and such Borrower’s or Guarantor’s operations, plus a per diem charge
at Agent’s then standard rate for Agent’s examiners in the field and office
(which rate as of the date hereof is $1,000 per person per day) subject to the
limitations set forth in Section 7.7 hereof; (g) any VAT incurred by Agent or
any Lender; and (h) the reasonable fees and disbursements of counsel (including
legal assistants) to Agent in connection with any of the foregoing and in
respect of the matters set forth in clause (e), above, of one counsel to Agent
as agent and a Lender, and one additional counsel to the other Lenders, to the
extent they may so require and as they may agree (and such local counsel as the
Agent and the Lenders may require).
     9.11 Applications under Insolvency Statutes. Each Borrower and Guarantor
acknowledges that its business and financial relationships with Agent and
Lenders are unique from its relationship with any other of its creditors, and
agrees that it shall not file any plan of arrangement under the Companies’
Creditors Arrangement Act (Canada) or make any proposal under the Bankruptcy and
Insolvency Act (Canada) which provides for, or would permit directly or
indirectly, Agent or any Lender to be classified with any other creditor as an
“affected” creditor for purposes of such plan or proposal or otherwise.
     9.12 After Acquired Real Property. If any Borrower or Guarantor hereafter
acquires any Real Property, fixtures or any other property that is of the kind
or nature described in the Mortgages and such Real Property, fixtures or other
property is adjacent to, contiguous with or necessary or related to or used in
connection with any Real Property then subject to a Mortgage, or if such Real
Property is not adjacent to, contiguous with or related to or used in connection
with such Real Property, then if such Real Property, fixtures or other property
at any location (or series of adjacent, contiguous or related locations, and
regardless of the number of parcels) has a fair market value in an amount equal
to or greater than $2,000,000 (or if a Default or Event of Default exists, then
regardless of the fair market value of such assets), without limiting any other
rights of Agent or any Lender, or duties or obligations of any Borrower or
Guarantor, promptly upon Agent’s request, such Borrower or Guarantor shall
execute and deliver to Agent a mortgage, deed of trust or deed to secure debt,
as Agent may determine, in form and substance substantially similar to the
Mortgages and as to any provisions relating to specific state laws satisfactory
to Agent and in form appropriate for recording in the real estate records of the
jurisdiction in which such Real Property or other property is located granting
to Agent a first and only lien and mortgage on and

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security interest in such Real Property, fixtures or other property (except as
such Borrower or Guarantor would otherwise be permitted to incur hereunder or
under the Mortgages or as otherwise consented to in writing by Agent) and such
other agreements, documents and instruments as Agent may require in connection
therewith.
SECTION 10. NEGATIVE COVENANTS
     10.1 Sale of Assets, Consolidation, Merger, Dissolution, Etc. Each Borrower
and Guarantor shall not, and shall not permit any Subsidiary to, directly or
indirectly,
          (a) merge into or with or consolidate with any other Person or permit
any other Person to merge into or with or consolidate with it except that any
wholly-owned Subsidiary of Parent may merge with and into or consolidate or
amalgamate with any other wholly-owned Subsidiary of Parent; provided, that, in
any merger, consolidation or amalgamation involving a Borrower, the Borrower
shall be the surviving entity); provided, that, each of the following conditions
is satisfied: (i) Agent shall have received not less than ten (10) Business
Days’ prior written notice of the intention of such Subsidiaries to so merger,
consolidate or amalgamate, which notice shall set forth in reasonable detail
satisfactory to Agent, the persons that are merging, consolidating or
amalgamating, which person will be the surviving entity, the locations of the
assets of the persons that are merging, consolidating or amalgamating, and the
material agreements and documents relating to such merger, consolidation or
amalgamation, (ii) Agent shall have received such other information with respect
to such merger, consolidation or amalgamation as Agent may reasonably request,
(iii) as of the effective date of the merger, consolidation or amalgamation and
after giving effect thereto, no Default or Event of Default shall exist or have
occurred, (iv) Agent shall have received, true, correct and complete copies of
all agreements, documents and instruments relating to such merger, consolidation
or amalgamation, including, but not limited to, the certificate or certificates
of merger to be filed with each appropriate Secretary of State (with a copy as
filed promptly after such filing), (v) the surviving entity shall expressly
confirm, ratify and assume the Obligations and the Loan Documents to which it is
a party in writing, in form and substance satisfactory to Agent, and Borrowers
and Guarantors shall execute and deliver such other agreements, documents and
instruments as Agent may request in connection therewith;
          (b) sell, issue, assign, lease, license, transfer, abandon or
otherwise dispose of any Equity Interests or Indebtedness to any other Person or
any of its assets to any other Person, except for Permitted Dispositions;
          (c) wind up, liquidate or dissolve except that any Guarantor (other
than Parent) may wind up, liquidate and dissolve; provided, that, each of the
following conditions is satisfied, (i) the winding up, liquidation and
dissolution of such Guarantor shall not violate any law or any order or decree
of any court or other Governmental Authority in any material respect and shall
not conflict with or result in the breach of, or constitute a default under, any
indenture, mortgage, deed of trust, or any other agreement or instrument to
which any Borrower or Guarantor is a party or may be bound, (ii) such winding
up, liquidation or dissolution shall be done in accordance with the requirements
of all applicable laws and regulations, (iii) effective upon such winding up,
liquidation or dissolution, all of the assets and properties of such Guarantor
shall be duly and validly transferred and assigned to a Borrower, free and clear
of any liens, restrictions or encumbrances other than the security interest and
liens of Agent (and Agent shall have received such evidence thereof as Agent may
require) and Agent shall have received such deeds, assignments or other
agreements as Agent may request to evidence and confirm the transfer of such
assets of such Guarantor to a Borrower, (iv) Agent shall have received all
documents and agreements that any Borrower or Guarantor has filed with any
Governmental Authority or as are otherwise required to effectuate such winding
up, liquidation or dissolution, (v) no Borrower or Guarantor shall assume any
Indebtedness, obligations or liabilities as a result of such winding up,
liquidation or

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dissolution, or otherwise become liable in respect of any obligations or
liabilities of the entity that is winding up, liquidating or dissolving, unless
such Indebtedness is otherwise expressly permitted hereunder, (vi) Agent shall
have received not less than ten (10) Business Days prior written notice of the
intention of such Guarantor to wind up, liquidate or dissolve, and (vii) as of
the date of such winding up, liquidation or dissolution and after giving effect
thereto, no Default or Event of Default shall exist or have occurred; or
          (d) agree to do any of the foregoing.
     10.2 Encumbrances. Each Borrower and Guarantor shall not, and shall not
permit any Subsidiary to, create, incur, assume or suffer to exist any security
interest, mortgage, pledge, lien, charge, hypothec or other encumbrance of any
nature whatsoever on any of its assets or properties, including the Collateral,
or file or permit the filing of, or permit to remain in effect, any financing
statement or other similar notice of any security interest or lien with respect
to any such assets or properties, except the following (collectively, “Permitted
Liens”):
          (a) the security interests, liens and hypothecs of Agent for itself
and the benefit of the Secured Parties and the rights of setoff of Secured
Parties hereunder or under applicable law;
          (b) liens securing the payment of taxes, assessments or other
governmental charges or levies either not yet overdue or the validity of which
are being contested in good faith by appropriate proceedings diligently pursued
and available to such Borrower, or Guarantor or Subsidiary, as the case may be
and with respect to which adequate reserves have been set aside on its books;
          (c) non-consensual statutory liens (other than liens securing the
payment of taxes) arising in the ordinary course of such Borrower’s, Guarantor’s
or Subsidiary’s business , such as carriers’, warehousemen’s, materialmen’s,
landlords’, workmen’s suppliers’, repairmen’s and mechanics’ liens, to the
extent: (i) such liens secure Indebtedness which is not overdue or (ii) such
liens secure Indebtedness relating to claims or liabilities which are fully
insured and being defended at the sole cost and expense and at the sole risk of
the insurer or (iii) such liens are being contested in good faith by appropriate
proceedings diligently pursued and available to such Borrower, Guarantor or such
Subsidiary, in each case prior to the commencement of foreclosure or other
similar proceedings and with respect to which adequate reserves or other
appropriate provision, if any as are required by GAAP have been made therefor;
          (d) easements (including, without limitation, reciprocal easement
agreements), rights of way, building, zoning and similar restrictions, licenses,
covenants and other restrictions affecting the use of Real Property which do not
interfere in any material respect with the use of such Real Property or ordinary
conduct of the business of such Borrower, Guarantor or such Subsidiary as
presently conducted thereon or materially impair the value of the Real Property
which may be subject thereto;
          (e) purchase money security interests in Equipment (including Capital
Leases) and the precautionary UCC or PPSA financing statement filings in respect
thereof) and purchase money mortgages on Real Property to secure Indebtedness
permitted under Section 10.3 (c) hereof;
          (f) pledges and deposits of cash by any Borrower or Guarantor after
the date hereof in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other types of social security benefits
consistent with the current practices of such Borrower or Guarantor as of the
date hereof;

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          (g) pledges and deposits of cash by any Borrower or Guarantor after
the date hereof to secure the performance of tenders, bids, leases, trade
contracts (other than for the repayment of Indebtedness), statutory obligations
and other similar obligations in each case in the ordinary course of business
consistent with the current practices of such Borrower or Guarantor as of the
date hereof; provided, that, in connection with any performance bonds issued by
a surety or other person, the issuer of such bond shall have waived in writing
any rights in or to, or other interest in, any of the Collateral in an
agreement, in form and substance satisfactory to Agent;
          (h) liens arising from (i) operating leases and the precautionary UCC
or PPSA financing statement filings in respect thereof and (ii) equipment or
other materials which are not owned by any Borrower or Guarantor located on the
premises of such Borrower or Guarantor (but not in connection with, or as part
of, the financing thereof) from time to time in the ordinary course of business
and consistent with current practices of such Borrower or Guarantor and the
precautionary UCC or PPSA financing statement filings in respect thereof;
          (i) judgments and other similar liens arising in connection with court
proceedings that do not constitute an Event of Default; provided, that, (i) such
liens are being contested in good faith and by appropriate proceedings
diligently pursued, (ii) adequate reserves or other appropriate provision, if
any, as are required by GAAP have been made therefor, (iii) a stay of
enforcement of any such liens is in effect and (iv) Agent may establish a
Reserve with respect thereto;
          (j) leases or subleases of Real Property granted by any Borrower or
Guarantor to any Person so long as any such leases or subleases are subordinate
in all respects to the security interests and liens granted to Agent and do not
interfere in any material respect with the ordinary conduct of the business of
such Borrower or Guarantor or materially impair the value or marketability of
the Real Property subject thereto; provided, that, the terms of such lease or
sublease is acceptable to Agent in its discretion;
          (k) licenses of Intellectual Property permitted under clause (d) of
the definition of Permitted Disposition;
          (l) [Intentionally omitted];
          (m) the security interests and liens set forth on Schedule 8.4 to the
Information Certificate and any security interests and liens to secure
Refinancing Indebtedness of the Indebtedness secured by such security interests
and liens to the extent permitted under Section 10.3(g) hereof;
          (n) liens incurred in the ordinary course of business of parent and
its Subsidiaries securing liabilities that do not exceed the US Dollar
Equivalent of $1,000,000 in the aggregate; provided, that, such liens do not
encumber any Accounts or Inventory, or any Equipment or Real Property included
in the Borrowing Base;
          (o) statutory or common law liens or rights of setoff of depository
banks with respect to funds of any Borrower, Guarantor or Subsidiary at such
banks to secure fees and charges in connection with returned items or the
standard fees and charges of such banks in connection with the deposit accounts
maintained by such Borrower, Guarantor or Subsidiary at such banks (but not any
other Indebtedness or obligations); and
          (p) Unregistered liens, charges, claims, security interests or other
encumbrances of any nature claimed or held by Her Majesty the Queen in Right of
Canada, her agency or authority, any Province any municipality or any political
subdivision thereof, under or pursuant to any applicable legislation, statute or
regulation, save and except for unregistered liens for public utilities and
realty taxes, workplace safety payments, payroll, health care, income and other
similar taxes which are due and payable;

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          (q) All rights of expropriation, access or use or other similar right
conferred by or reserved by any Federal, Provincial or municipal authority or
agency;
          (r) any defects irregularities, easements or encroachments existing as
of the Closing Date that might be revealed by an up-to-date survey of the
property;
          (s) the provisions of Section 78(3) of the Land Titles Act (Ontario);
          (t) reservations, limitation, provisos and conditions, if any,
expressed in any original grants from the Crown;
          (u) any municipal by-laws or regulations affecting the Real Property
or its use and any other municipal land use instruments including, without
limitation, official plans and zoning and building by-laws, as well as decisions
of committee of adjustment or any other competent authority permitting variances
therefrom, and all applicable building codes which do not interfere in any
material respect with the use of such Real Property or ordinary conduct of the
business of any Borrower, Guarantor or Subsidiary as presently conducted thereon
or materially impair the value of the Real Property which may be subject
thereto;
          (v) any agreements with any Governmental Authority or utility that do
not, in the aggregate, have a Material Adverse Effect on the use or the value of
the Real Property and improvements thereon;
          (w) the exceptions and qualifications contained in Section 44(1) of
the Land Titles Act (Ontario) save and except paragraphs 1, 2, 3, 4 and 11
thereof;
          (x) Watercourses and right of water;
          (y) liens existing as of the Closing Date which are permitted
exceptions under the title insurance policies being provided to the Agent; and
          (z) the specific liens and encumbrances registered against title to
the Real Property as set forth below:

                   Burlington —             1001 Corporate Drive, Burlington,
Ontario
PIN Nos. 07181-0123(LT) and 07181-0128(LT)
 
           
 
    1.     Instrument No. 455210
 
    2.     Instrument No. 471873
 
    3.     Instrument No. H181692
 
    4.     Instrument No. H181693
 
    5.     Instrument No. H305153
 
    6.     Instrument No. H305155
 
    7.     Instrument No. 119980
 
    8.     Instrument No. 661913
 
    9.     Instrument No. 661914

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                 London — 6320 Colonel Talbot Road, London, Ontario
PIN No. 08207-0066(LT)
 
         
 
    1.   Instrument No. 195923

 
    2.   Instrument No. 510006
 
               Montréal — 2501 TransCanada Highway, Point-Claire Québec
Lot numbers 2 528 215, 2 528 216 and 2 528 217, of the
Cadastre of Québec, Registration division on Montréal.  
 
    1.   Instrument No. 1 642 069
 
    2.   Instrument No. 1 643 985
 
    3.   Instrument No. 2 032 161
 
    4.   Instrument No. 4 807 168
 
    5.   Instrument No. 4 829 839
 
    6.   Instrument No. 1 876 915

     10.3 Indebtedness. Each Borrower and Guarantor shall not, and shall not
permit any Subsidiary to, incur, create, assume, become or be liable in any
manner with respect to, or permit to exist, any Indebtedness, or guarantee,
assume, endorse, or otherwise become responsible for (directly or indirectly),
the Indebtedness, performance, obligations or dividends of any other Person,
except:
          (a) the Obligations;
          (b) the Indebtedness of Associated and its Subsidiaries in respect of
the Opco Notes as in effect on the date hereof;
          (c) purchase money Indebtedness (including Capital Leases) arising
after the date hereof to the extent secured by purchase money security interests
in Equipment (including Capital Leases) and purchase money mortgages on Real
Property or in respect of industrial revenue bonds or other similar government
or municipal bonds (subject to such intercreditor and subordination arrangements
as Agent may reasonably required) not to exceed $7,500,000 in the aggregate at
any time outstanding so long as such security interests and mortgages do not
apply to any property of such Borrower, Guarantor or Subsidiary other than the
Equipment or Real Property so acquired, and the Indebtedness secured thereby
does not exceed the cost of the Equipment or Real Property so acquired, as the
case may be;
          (d) guarantees by any Borrower or Guarantor of the Obligations of the
other Borrowers or Guarantors in favor of Agent for the benefit of Lenders;
          (e) the Indebtedness of any Borrower or Guarantor to any other
Borrower or Guarantor arising after the date hereof pursuant to loans by any
Borrower or Guarantor permitted hereunder;
          (f) unsecured Indebtedness of any Borrower or Guarantor arising after
the date hereof to any third person (but not to any other Borrower or
Guarantor); provided, that, each of the following conditions is satisfied as
determined by Agent: (i) such Indebtedness shall be on terms and conditions
acceptable to Agent and shall be subject and subordinate in right of payment to
the right of Agent and Lenders to receive the prior indefeasible payment and
satisfaction in full payment of all of the Obligations pursuant to the terms of
an intercreditor agreement between Agent and such third party, in form and
substance satisfactory to Agent, (ii) Agent shall have received not less than
ten (10) days prior written notice of the intention of such Borrower or
Guarantor to incur such Indebtedness, which notice shall set forth in reasonable
detail satisfactory to Agent the amount of such Indebtedness, the person or
persons to

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whom such Indebtedness will be owed, the interest rate, the schedule of
repayments and maturity date with respect thereto and such other information as
Agent may request with respect thereto, (iii) Agent shall have received true,
correct and complete copies of all agreements, documents and instruments
evidencing or otherwise related to such Indebtedness, (iv) except as Agent may
otherwise agree in writing, all of the proceeds of the loans or other
accommodations giving rise to such Indebtedness shall be paid to Agent for
application to the Obligations in such order and manner as Agent may determine
or at Agent’s option, to be held as cash collateral for the Obligations, (v) in
no event shall the aggregate principal amount of such Indebtedness incurred
during the term of this Agreement exceed $20,000,000, (vi) as of the date of
incurring such Indebtedness and after giving effect thereto, no Default or Event
of Default shall exist or have occurred, (vii) such Borrower and Guarantor shall
not, directly or indirectly, (A) amend, modify, alter or change the terms of
such Indebtedness or any agreement, document or instrument related thereto;
except, that, such Borrower or Guarantor may, after prior written notice to
Agent, amend, modify, alter or change the terms thereof so as to extend the
maturity thereof, or defer the timing of any payments in respect thereof, or to
forgive or cancel any portion of such Indebtedness (other than pursuant to
payments thereof), or to reduce the interest rate or any fees in connection
therewith, or (B) redeem, retire, defease, purchase or otherwise acquire such
Indebtedness (except pursuant to regularly scheduled payments permitted herein),
or set aside or otherwise deposit or invest any sums for such purpose, and
(viii) Borrowers and Guarantors shall furnish to Agent all notices or demands in
connection with such Indebtedness either received by any Borrower or Guarantor
or on its behalf promptly after the receipt thereof, or sent by any Borrower or
Guarantor or on its behalf concurrently with the sending thereof, as the case
may be;
          (g) Indebtedness of Borrower arising after the date hereof issued in
exchange for, or the proceeds of which are used to extend, refinance, replace or
substitute for Indebtedness permitted under Sections 10.3(b) (the “Refinancing
Indebtedness”); provided, that, as to any such Refinancing Indebtedness, each of
the following conditions is satisfied: (i) Agent shall have received not less
than ten (10) Business Days’ prior written notice of the intention to incur such
Indebtedness, which notice shall set forth in reasonable detail satisfactory to
Agent, the amount of such Indebtedness, the schedule of repayments and maturity
date with respect thereto and such other information with respect thereto as
Agent may reasonably request, (ii) promptly upon Agent’s request, Agent shall
have received true, correct and complete copies of all agreements, documents and
instruments evidencing or otherwise related to such Indebtedness, as duly
authorized, executed and delivered by the parties thereto, (iii) the Refinancing
Indebtedness shall have a Weighted Average Life to Maturity and a final maturity
equal to or greater than the Weighted Average Life to Maturity and the final
maturity, respectively, of the Indebtedness being extended, refinanced,
replaced, or substituted for, (iv) the Refinancing Indebtedness shall rank in
right of payment no more senior than, and be at least as subordinated (if
subordinated) to, the Obligations as the Indebtedness being extended,
refinanced, replaced or substituted for, (v) the Refinancing Indebtedness shall
not include terms and conditions with respect to Borrowers and Guarantors which
are more burdensome or restrictive in any material respect than those included
in the Indebtedness so extended, refinanced, replaced or substituted for, taken
as a whole, so that in view of all of the terms and conditions of the
Refinancing Indebtedness, such terms and conditions are more favorable to
Borrowers and Guarantors; except, that, the interest rate of the Indebtedness
replacing Indebtedness under Section 10.3(b) may be greater than the interest
rate applicable to the Indebtedness being replaced if, in addition to the other
requirements of this Section 10.3(g), the Fixed Charge Coverage Ratio of Parent
and its Subsidiaries (on a consolidated basis) shall have been not less than
1.2:1.0 with respect to the twelve (12) consecutive calendar month period ending
as of the date of the incurrence of such Refinancing Indebtedness and shall be
not less than 1.2:1.0 after giving effect thereto, (vi) as of the date of
incurring such Indebtedness and after giving effect thereto, no Default or Event
of Default shall exist or have occurred and be continuing, (vii) the principal
amount of such Refinancing Indebtedness shall not exceed the principal amount of
the Indebtedness so extended, refinanced, replaced or substituted for (plus the
lesser of (A) the stated amount of any premium or other payment required to be
paid in connection with

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such refinancing pursuant to the terms of the Indebtedness being refinanced and
(B) the amount of premium or other payment actually paid at such time to
refinance the Indebtedness, plus, in either case, the amount of reasonable
expenses of Borrowers and Guarantors incurred in connection with such
refinancing), (viii) the Refinancing Indebtedness shall be secured by
substantially the same assets, provided, that, such security interests (if any)
with respect to the Refinancing Indebtedness shall have a priority no more
senior than, and be at least as subordinated, if subordinated (on terms and
conditions substantially similar to the subordination provisions applicable to
the Indebtedness so extended, refinanced, replaced or substituted for or as is
otherwise acceptable to Agent) as the security interest with respect to the
Indebtedness so extended, refinanced, replaced or substituted for, and
(ix) Borrowers and Guarantors may only make payments of principal, interest and
fees, if any, in respect of such Indebtedness to the extent such payments would
have been permitted hereunder in respect of the Indebtedness so extended,
refinanced, replaced or substituted for;
          (h) unsecured Indebtedness of a Borrower or Guarantor in respect of
seller notes on terms and acceptable to Agent, so long as the aggregate
principal amount of seller notes outstanding, when aggregated with the aggregate
principal amount of Indebtedness outstanding pursuant to clause (i), below, of
this Section 10.3, does not at any time exceed $8,000,000;
          (i) Indebtedness of a Person existing at the time such Person became a
Subsidiary of a Borrower pursuant to a transaction permitted hereunder (such
Person, an “Acquired Person”), together with all Indebtedness assumed by a
Borrower or Guarantor in connection with any Permitted Acquisition, in respect
only of Real Property and capitalized leases which, when aggregated with the
aggregate principal amount of Indebtedness outstanding pursuant to clause (h),
above, of this Section 10.3, does not at any time exceed $8,000,000; provided,
that, such Indebtedness shall not have been created or incurred in contemplation
of such Person becoming a Subsidiary or in contemplation of such Permitted
Acquisition;
          (j) Indebtedness of a Borrower in respect of Hedge Agreements not for
speculative purposes or unsecured forward currency hedges in the ordinary course
of a Borrower’s business;
          (k) Indebtedness of Parent incurred in connection with repurchases of
its Equity Interests from employees, officers, directors or consultants of
Parent or its Subsidiaries upon their ceasing to be employees, officers,
directors or consultants of Parent or any such Subsidiary, as the case may be,
or upon such Person’s death or disability; provided that (i) the aggregate
principal amount of such repurchases funded with Indebtedness does not exceed
$5,000,000 in the aggregate outstanding at any time and (ii) such Indebtedness
is subordinated to the Obligations on terms reasonably satisfactory to the
Agent;
          (l) guaranties by the Borrowers and the Guarantors of Indebtedness and
lease obligations of the Borrowers and the Guarantors to the extent that such
Indebtedness or lease obligations created in respect of any such guaranty would
otherwise be permitted to be incurred as a direct obligation by such Borrower or
such Guarantor, as the case may be, under this Section 10.3 or otherwise under
this Agreement;
          (m) intercompany Indebtedness at any time outstanding with respect to
tax sharing arrangements to the extent permitted under Section 10.6 hereof;
          (n) the Indebtedness set forth on Schedule 9.9 to the Information
Certificate; provided, that, (i) Borrowers and Guarantors may only make
regularly scheduled payments of principal and interest in respect of such
Indebtedness in accordance with the terms of the agreement or instrument
evidencing or giving rise to such Indebtedness as in effect on the date hereof,
(ii) Borrowers and Guarantors shall not, directly or indirectly, (A) amend,
modify, alter or change the terms of such Indebtedness or any

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agreement, document or instrument related thereto as in effect on the date
hereof; except, that, Borrowers and Guarantors may, after prior written notice
to Agent, amend, modify, alter or change the terms thereof so as to extend the
maturity thereof, or defer the timing of any payments in respect thereof, or to
forgive or cancel any portion of such Indebtedness (other than pursuant to
payments thereof), or to reduce the interest rate or any fees in connection
therewith, or (B) redeem, retire, defease, purchase or otherwise acquire such
Indebtedness, or set aside or otherwise deposit or invest any sums for such
purpose, and (iii) Borrowers and Guarantors shall furnish to Agent all notices
or demands in connection with such Indebtedness either received by any Borrower
or Guarantor or on its behalf, promptly after the receipt thereof, or sent by
any Borrower or Guarantor or on its behalf, concurrently with the sending
thereof, as the case may be.
Notwithstanding any provision of this Section 10.3 or any other provision of
this Agreement to the contrary, in no event shall the aggregate outstanding
principal amount of Indebtedness incurred pursuant to Sections 10.3(c) through
(n) inclusive exceed the US Dollar Equivalent of $40,000,000; except, that, to
the extent that intercompany loans under Section 10.3(m) above are not remitted
in cash by a Borrower or Guarantor in accordance with the terms of the
agreements governing such intercompany loans, which shall be in form and
substance satisfactory to Agent, the portion of such loan not so remitted shall
not be included for purposes of calculating such $40,000,000 amount.
     10.4 Loans, Investments, Etc. Each Borrower and Guarantor shall not, and
shall not permit any Subsidiary to, directly or indirectly, make any loans or
advance money or property to any person, or invest in (by capital contribution,
dividend or otherwise) or purchase or repurchase the Equity Interests or
Indebtedness or all or a substantial part of the assets or property of any
person, or form or acquire any Subsidiaries (each, an “Investment”), or agree to
do any of the foregoing, except:
          (a) Permitted Investments; and
          (b) Permitted Acquisitions.
     10.5 Restricted Payments. Borrowers and Guarantors shall not, and shall not
permit any Subsidiary to, declare or make, or agree to pay or make, directly or
indirectly, any Restricted Payment, except:
          (a) Borrowers and Guarantors, and each Subsidiary, may declare and
make dividend payments or other distributions payable solely in the Equity
Interests of such Person;
          (b) any Subsidiary of Parent may pay dividends or other distributions
to Parent or any other Subsidiary of Parent to the extent that such amount could
be advanced as a loan in accordance with clause (l) of the definition of
Permitted Investments hereunder;
          (c) Borrowers and Guarantors may pay, or declare or pay dividends or
distributions to Parent or the direct or indirect owners of the Equity Interest
in Parent as of the date hereof, that are used to make substantially
contemporaneous payments of, any of the following:
               (i) out-of-pocket expenses for administrative, legal and
accounting services provided by third parties incurred in the ordinary course of
business in connection with the businesses of Borrowers, or to pay franchise
fees and similar costs incurred in connection with the businesses of Borrowers,
customary fees to non-officer directors of Parent or the direct or indirect
owners of the Equity Interest in Parent as of the date hereof who are not
Affiliates of Parent, out-of-pocket expenses to directors or observers of the
board of directors of Parent or the direct or indirect owners of the Equity
Interest in Parent as of the date hereof; provided, that, (A) as of the date of
any such payments or distributions and after giving effect thereto, no Default
or Event of Default shall exist or have occurred and be continuing and (B) the
aggregate amount of all of the foregoing do not exceed the US Dollar Equivalent
of $5,000,000 in any period of twelve (12) consecutive calendar months;

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               (ii) taxes attributable to the businesses of Borrowers as part of
a consolidated, combined or unitary tax filing group or of the separate
operations of Parent which are actually due and payable (not to exceed in any
event the amount of tax that Borrowers and its Subsidiaries would otherwise pay
if not part of such filing group);
          (d) [Intentionally omitted];
          (e) Borrowers and Guarantors may make payments to repurchase or redeem
Equity Interests and options to purchase Equity Interests of such Borrower or
Guarantor held by officers, directors or employees or former officers, directors
or employees (or their transferees, estates or beneficiaries under their
estates) of any Borrower or Guarantor, upon their death, disability, retirement,
severance or termination of employment or service; provided, that, (i) as of the
making of such payment and after giving effect thereto, no Default or Event of
Default shall exist or have occurred and be continuing, (ii) the aggregate cash
consideration paid for all such payments, repurchases or redemptions shall not
exceed $2,000,000 in any period of twelve (12) consecutive calendar months or
$4,000,000 during the term of this Agreement and (iii) in the event that the sum
of all such payments and Restricted Payments made pursuant to Section 10.5(f)
below exceeds the US Dollar Equivalent of $5,000,000 during the term hereof,
then as of the date of the making of each such payment and after giving effect
thereto (A) the Global Availability Test Condition shall be met and (B) the
Fixed Charge Coverage Ratio of Parent and its Subsidiaries, on a consolidated
basis, shall be not less than 1.1:1.0 for the immediately preceding twelve (12)
consecutive calendar month period ending on such date and after giving effect
thereto;
          (f) so long as at the time of such purchase (and after giving effect
thereto) no Default or Event of Default shall exist or have occurred and be
continuing, Parent may (and the Borrowers may make Restricted Payments to Parent
to permit Parent to) repurchase, or make a Restricted Payment to or through any
direct or indirect parent company of Parent to repurchase, Management Shares
from any Management Investor or repay (or make interest payments on), or make a
Restricted Payment to or through any Parent or indirect parent company of Parent
to repay, Indebtedness incurred pursuant to clause (k) of Section 10.3 (or like
Indebtedness incurred by Parent or indirect parent company of Parent) with
proceeds of the key-man life insurance maintained on the life of such Management
Investor; provided, that, in the event that the sum of all such payments and
Restricted Payments made pursuant to Section 10.5(e) above exceeds the US Dollar
Equivalent of $5,000,000 during the term hereof, then as of the date of the
making of each such payment and after giving effect thereto (i) the Global
Availability Test Condition shall be met and (ii) the Fixed Charge Coverage
Ratio of Parent and its Subsidiaries, on a consolidated basis, shall be not less
than 1.1:1.0 for the immediately preceding twelve (12) consecutive calendar
month period ending on such date and after giving effect thereto;
          (g) repurchases of Equity Interests of Parent deemed to occur upon the
exercise of stock options if such Equity Interests represent a portion of the
exercise price thereof and so long as no cash is paid or distributed by Parent
or any of its Subsidiaries in connection therewith and as such repurchases do
not cause a Change of Control; and
          (h) Borrowers and Guarantors may make Restricted Payments not
otherwise specified above; provided, that, each of the following conditions is
satisfied: (i)Agent shall have received not less than five (5) Business Days’
prior written notice of the intention of a Borrower or Guarantor to make such
payment, (ii) as of the date of the making of such Restricted Payment and after
giving effect thereto, the Global Availability Test Condition shall be met,
(iii) as of the date of the making of such Restricted

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Payment and after giving effect thereto, Consolidated EBITDA of Parent and its
Subsidiaries for the immediately preceding fiscal quarter of Parent and its
Subsidiaries for which financial statements have been delivered (or, if such
quarter is the first fiscal quarter of Parent and its Subsidiaries of such year,
then the fiscal quarter immediately preceding such quarter)(the “Reference
Quarter”) shall be at least fifty (50%) percent of Consolidated EBITDA of Parent
and its Subsidiaries for the Reference Quarter in the prior fiscal year, and
(iv) as of the date of the making of such Restricted Payment and after giving
effect thereto, no Default or Event of Default shall exist or have occurred and
be continuing.
     10.6 Transactions with Affiliates. Borrowers and Guarantors shall not,
directly or indirectly, purchase, acquire or lease any property from, or sell,
transfer or lease any property to, any officer, director or other Affiliates of
any Borrower or Guarantor, except pursuant to the reasonable requirements of
such Borrower’s or Guarantor’s business (as the case may be) and upon fair and
reasonable terms no less favorable to such Borrower or Guarantor than such
Borrower or Guarantor, as the case may be, would obtain in a comparable arm’s
length transaction with an unaffiliated person, except for the following:
          (a) Restricted Payments permitted under Section 10.5 hereof;
          (b) the payment of reasonable fees to directors of Borrowers or direct
or indirect parent companies of the Borrowers who are not employees of
Borrowers;
          (c) advances to employees permitted under clause (i) of the definition
of Permitted Investments;
          (d) employment agreements and arrangements of Borrowers (including,
without limitation, benefits, expense reimbursement or advancement) consistent
with past practices of the Borrowers and approved by the board of directors of a
Borrower or committee thereof or as are expressly provided for in the
certificate or articles of incorporation, articles of formation, by-laws or
management agreement of such Borrower, which in the aggregate do not exceed the
US Dollar Equivalent of $6,000,000 in annual compensation and benefits in
accordance with the terms of such employment agreements, and such reasonable
insurance and indemnification arrangements for officers and directors as are
approved by the Board of Directors or a committee thereof, or of the members, as
the case may be, or as expressly provided for in the certificate or articles of
incorporation or formation or by-laws or operating agreement of such Borrower;
          (e) any employee benefit plan available to employees of Borrowers
generally;
          (f) Parent and its Subsidiaries may enter into a tax sharing agreement
or arrangement with, and may make, without duplication of any amounts paid
pursuant to Section 10.5, payments pursuant thereto to any direct or indirect
parent company of Parent with which Parent or its Subsidiaries is required or
permitted to file a consolidated tax return or with which Parent or any of its
Subsidiaries is or could be part of a consolidated group for tax purposes in
amounts otherwise permitted by Section 10.5; and
          (g) sales or issuances of Equity Interests of a Borrower or Guarantor
to an Affiliate thereof not otherwise prohibited by this Agreement and the
granting of registration and other customary rights in connection therewith.
     10.7 Change in Business. Each Borrower and Guarantor shall not engage in
any business other than the business of such Borrower or Guarantor on the date
hereof and any business reasonably related, ancillary or complimentary to the
business in which such Borrower or Guarantor is engaged on the date hereof.

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     10.8 Limitation of Restrictions Affecting Subsidiaries. Each Borrower and
Guarantor shall not, directly, or indirectly, create or otherwise cause or
suffer to exist any encumbrance or restriction which prohibits or limits the
ability of any Subsidiary of such Borrower or Guarantor to (a) pay dividends or
make other distributions or pay any Indebtedness owed to such Borrower or
Guarantor or any Subsidiary of such Borrower or Guarantor; (b) make loans or
advances to such Borrower or Guarantor or any Subsidiary of such Borrower or
Guarantor, (c) transfer any of its properties or assets to such Borrower or
Guarantor or any Subsidiary of such Borrower or Guarantor; or (d) create, incur,
assume or suffer to exist any lien upon any of its property, assets or revenues,
whether now owned or hereafter acquired, other than encumbrances and
restrictions arising under (i) applicable law, (ii) this Agreement,
(iii) customary provisions restricting subletting or assignment of any lease
governing a leasehold interest of such Borrower or Guarantor or any Subsidiary
of such Borrower or Guarantor, (iv) customary restrictions on dispositions of
real property interests found in reciprocal easement agreements of such Borrower
or Guarantor or any Subsidiary of such Borrower or Guarantor, (v) any agreement
relating to permitted Indebtedness incurred by a Subsidiary of such Borrower or
Guarantor prior to the date on which such Subsidiary was acquired by such
Borrower or such Guarantor and outstanding on such acquisition date,
(vi) customary restrictions in agreements for the sale of assets on the transfer
or encumbrance of such assets during an interim period prior to the closing of
the sale of such assets, (vii) customary restrictions in contracts that prohibit
the assignment of such contract to the extent such contract is in effect as of
the date hereof or is acquired pursuant to a Permitted Acquisition,
(viii) customary restrictions in agreements relating to purchase money financing
arrangements of Borrower or contained in security agreements providing for the
grant of a security interest to secure other Indebtedness owing to a person that
is not an Affiliate to the extent such restrictions restrict the transfer of, or
the granting of liens on, the property subject to such purchase money financing
arrangements or security agreements, and (ix) the extension or continuation of
contractual obligations in existence on the date hereof or permitted Refinancing
Indebtedness thereof; provided, that, any such encumbrances or restrictions
contained in such extension, continuation or refinancing are no less favorable
to Agent and Lenders than those encumbrances and restrictions under or pursuant
to the contractual obligations so extended, continued or refinanced.
     10.9 Certain Payments of Indebtedness, Etc. Borrowers and Guarantors shall
not, and shall not permit any Subsidiary to, make or agree to make any payment,
prepayment, redemption, retirement, defeasance, purchase or sinking fund payment
or other acquisition for value of any of its Indebtedness, other than the
Indebtedness under the Loan Documents (including, without limitation, by way of
depositing money or securities with the trustee therefor before the date
required for the purpose of paying any portion of such Indebtedness when due),
or otherwise set aside or deposit or invest any sums for such purpose; except,
that:
          (a) Associated may make Opco Permitted Payments;
          (b) Borrowers and Guarantors may make payments or prepayments in
respect of the Opco Notes, including, without limitation, payments of principal,
accrued interest and any applicable redemption premium in respect of the Opco
Notes as in effect on the date hereof; provided, that, (i) as of the date of
each such payment and after giving effect thereto no Default or Event of Default
shall exist or have occurred and be continuing, (ii) as of the date of such
payment and after giving effect thereto on a pro forma basis, the Global
Availability Test Condition shall be satisfied, and (iii) the aggregate amount
of all such payments and prepayments shall not exceed $5,000,000 during any
period of twelve (12) consecutive calendar months or $20,000,000 during the term
of this Agreement;

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          (c) in addition to the payments and prepayments permitted to be made
in respect of the Opco Notes pursuant to and in accordance with Section 10.9(b)
above, Borrowers and Guarantors may make additional prepayments in respect of
the Opco Notes not to exceed the aggregate amount of the US Dollar Equivalent of
US $20,000,000 during any period of twelve (12) consecutive calendar months or
the US Dollar Equivalent of US $50,000,000 during the term of this Agreement;
provided, that, with respect to any such additional prepayment (i) as of the
date of such additional prepayment and after giving effect thereto no Default or
Event of Default shall exist or have occurred and be continuing, (ii) for the
twelve (12) consecutive calendar month period immediately preceding the date of
such additional prepayment and as of the date of such additional prepayment and
after giving effect thereto, the aggregate availability Excess Availability of
Borrowers shall be not less that thirty-five (35%) percent of the Maximum
Credit, (iii) for the twelve (12) consecutive calendar month period immediately
preceding the date of such additional prepayment and as of the date of such
additional prepayment and after giving effect thereto, the Excess Availability
of US Borrowers shall be not less that thirty-five (35%) percent of the US Loan
Limit, (iv) for the twelve (12) consecutive calendar month period immediately
preceding the date of such additional prepayment and as of the date of such
additional prepayment and after giving effect thereto, the Excess Availability
of Canadian Borrowers shall be not less that thirty-five (35%) percent of the
Canadian Loan Limit and (v) as of the twelve (12) consecutive calendar month
period immediately preceding the date of such additional prepayment and after
giving effect thereto the Fixed Charge Coverage Ratio of Parent and its
Subsidiaries, on a consolidated basis, shall be not less than 1.2:1.0 and shall
be projected, pursuant to projections in form and substance satisfactory to
Agent, to be not less than 1.2:1.0 throughout the immediately succeeding twelve
consecutive calendar month period (with Fixed Charges calculated in each case
for such purpose to include such additional prepayment);
          (d) Borrowers may make payments in respect of Indebtedness permitted
under Sections 10.3(b) with proceeds of Refinancing Indebtedness as permitted
under Section 10.3(g); and
          (e) as to payments in respect of any other Indebtedness permitted
under Section 10.3 hereof not subject to the provisions above in this
Section 10.9, Borrowers and Guarantors may make payments of regularly scheduled
principal and interest or other mandatory payments as and when due in respect of
such Indebtedness in accordance with the terms thereof (and in the case of
Subordinated Debt, subject to the terms of subordination set forth therein or
applicable thereto).
     10.10 Modifications of Indebtedness, Organizational Documents and Certain
Other Agreements. Borrowers and Guarantors shall not, and shall not permit any
Subsidiary to amend, modify or otherwise change its certificate of
incorporation, articles of association, certificate of formation, limited
liability agreement, limited partnership agreement or other organizational
documents, as applicable, including, without limitation, entering into any new
agreement with respect to any of its Equity Interests, except for amendments,
modifications or other changes that do not affect the rights and privileges of
any Borrower or Guarantor, or its Subsidiaries in any material respect and do
not adversely affect the ability of any Borrower, any Guarantor or such
Subsidiary to amend, modify, renew or supplement the terms of this Agreement or
any of the other Loan Documents, or otherwise adversely affect the interests of
Agent or any Lender in any material respect and so long as at the time of any
such amendment, modification or change, no Default or Event of Default shall
exist or have occurred and be continuing;
     10.11 Designation of Designated Senior Indebtedness. Borrowers and
Guarantors shall not, and shall not permit any Subsidiary to, designate any
Indebtedness, other than the Obligations as the “Bank Indebtedness” or
“Designated Senior Indebtedness” under the Opco Indenture, or any similar term
under and as defined in the agreements relating to any other Indebtedness of any
Borrower or Guarantor, including Subordinated Debt, which contains such
designation. Borrowers and Guarantors shall, and shall cause any Subsidiary to,
designate the Obligations as “Designated Senior Indebtedness” or any similar
term under and as defined in the agreements relating to any Indebtedness
(including any Subordinated Debt) of Borrowers or Guarantors which contains such
designation.
     10.12 License Agreements.

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          (a) Each Borrower and Guarantor shall (i) promptly and faithfully
observe and perform all of the material terms, covenants, conditions and
provisions of the License Agreements constituting Material Contracts to which it
is a party to be observed and performed by it, at the times set forth therein,
if any, (ii) not do, permit, suffer or refrain from doing anything that could
reasonably be expected to result in a default under or breach of any of the
terms of any Material License Agreement, (iii) not cancel, surrender, modify,
amend, waive or release any Material License Agreement in any material respect
or any term, provision or right of the licensee thereunder in any material
respect, or consent to or permit to occur any of the foregoing; except, that,
subject to Section 10.12(b) below, such Borrower or Guarantor may cancel,
surrender or release any Material License Agreement in the ordinary course of
the business of such Borrower or Guarantor; provided, that, such Borrower or
Guarantor (as the case may be) shall give Agent not less than thirty (30) days
prior written notice of its intention to so cancel, surrender and release any
such Material License Agreement, (iv) give Agent prompt written notice of any
Material License Agreement entered into by such Borrower or Guarantor after the
date hereof, together with a true, correct and complete copy thereof and such
other information with respect thereto as Agent may request, (v) give Agent
prompt written notice of any material breach of any obligation, or any default,
by any party under any Material License Agreement, and deliver to Agent
(promptly upon the receipt thereof by such Borrower or Guarantor in the case of
a notice to such Borrower or Guarantor and concurrently with the sending thereof
in the case of a notice from such Borrower or Guarantor) a copy of each notice
of default and every other notice and other communication received or delivered
by such Borrower or Guarantor in connection with any Material License Agreement
which relates to the right of such Borrower or Guarantor to continue to use the
property subject to such License Agreement, and (vi) furnish to Agent, promptly
upon the request of Agent, such information and evidence as Agent may reasonably
require from time to time concerning the observance, performance and compliance
by such Borrower or Guarantor or the other party or parties thereto with the
material terms, covenants or provisions of any Material License Agreement.
          (b) Each Borrower and Guarantor will either exercise any option to
renew or extend the term of each Material License Agreement to which it is a
party in such manner as will cause the term of such Material License Agreement
to be effectively renewed or extended for the period provided by such option and
give prompt written notice thereof to Agent or give Agent prior written notice
that such Borrower or Guarantor does not intend to renew or extend the term of
any such Material License Agreement or that the term thereof shall otherwise be
expiring, not less than sixty (60) days prior to the date of any such
non-renewal or expiration. In the event of the failure of such Borrower or
Guarantor to extend or renew any Material License Agreement to which it is a
party, Agent shall have, and is hereby granted, the irrevocable right and
authority, at its option, to renew or extend the term of such Material License
Agreement, whether in its own name and behalf, or in the name and behalf of a
designee or nominee of Agent or in the name and behalf of such Borrower or
Guarantor, as Agent shall determine at any time that an Event of Default shall
exist or have occurred and be continuing. Agent may, but shall not be required
to, perform any or all of such obligations of such Borrower or Guarantor under
any of the License Agreements, including, but not limited to, the payment of any
or all sums due from such Borrower or Guarantor thereunder. Any sums so paid by
Agent shall constitute part of the Obligations.
     10.13 Foreign Assets Control Regulations, Etc. None of the requesting or
borrowing of the Loans or the requesting or issuance, extension or renewal of
any Letter of Credit or the use of the proceeds of any thereof will violate the
Trading With the Enemy Act (50 USC §1 et seq., as amended) (the “Trading With
the Enemy Act”) or any of the foreign assets control regulations of the United
States Treasury Department (31 C.F.R., Subtitle B, Chapter V, as amended) (the
“Foreign Assets Control Regulations”) or any enabling legislation or executive
order relating thereto (including, but not limited to (a) Executive order 13224
of September 21, 2001 Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079
(2001)) (the “Executive Order”) and (b) the Uniting and Strengthening America by
Providing Appropriate Tools

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Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56).
None of Borrowers or any of their Subsidiaries or Affiliates is or will become a
“blocked person” as described in the Executive Order, the Trading with the Enemy
Act or the Foreign Assets Control Regulations or engages or will engage in any
dealings or transactions, or be otherwise associated, with any such “blocked
person”.
SECTION 11. FINANCIAL COVENANT
     11.1 Fixed Charge Coverage Ratio.
          (a) Subject to Sections 11.1(b) and (c) below, at any time that Global
Excess Availability is less than twelve and one-half (12 1/2%) percent of the
Maximum Credit, the US Excess Availability is less than twelve and one-half (12
1/2%) percent of the US Loan Limit or Canadian Excess Availability is less than
twelve and one-half (12 1/2%) percent of the Canadian Loan Limit (any of the
foregoing, a “Covenant Trigger”), the Fixed Charge Coverage Ratio of Parent and
its Subsidiaries (on a consolidated basis) determined as of the end of the
fiscal month most recently ended for which Agent has received financial
statements shall be not less than 1.10 to 1.0 for the period of the immediately
preceding twelve (12) consecutive fiscal months prior to such fiscal month end.
          (b) Upon an Event of Default as a result of the failure of Borrowers
to comply with Section 11.1(a) above, such Event of Default shall, subject to
the limitations set forth below, be deemed cured and cease to exist in the event
that one or more of the Sponsors or their Affiliates, within five (5) Business
Days after written notice by Agent to Borrowers of such Event of Default (or
such longer period as Agent may agree), makes a cash equity capital contribution
to Borrowers in exchange for Equity Interests in such Borrower, the proceeds of
which are applied to the Revolving Loans, such that after giving effect thereto,
the calculation of the Borrowing Base results in Global Excess Availability of
more than twelve and one-half (12 1/2%) of the Maximum Credit, US Excess
Availability of more than twelve and one-half (12 1/2%) percent of the US Loan
Limit and Canadian Excess Availability of more than twelve and one-half (12
1/2%) percent of the Canadian Loan Limit and compliance with Section 11.1(a),
above shall be deemed to have not been required as of the date of such Event of
Default. Each such equity contribution is referred to as “Cure Action”. No more
than one (1) Cure Action may be taken in any period of one hundred ten
(110) consecutive days.
          (c) In the event that at any time after a Covenant Trigger, Global
Excess Availability is then greater than twelve and one-half (12 1/2%) percent
of the Maximum Credit, US Excess Availability is more than twelve and one-half
(12 1/2%) percent of the US Loan Limit and Canadian Excess Availability is more
than twelve and one-half (12 1/2%) percent of the Canadian Loan Limit, in each
case for sixty (60) consecutive days, the Fixed Charge Coverage Ratio of Parent
and its Subsidiaries, on a consolidated basis, will not be tested thereafter
until the occurrence of another Covenant Trigger. In the event of the occurrence
of another Covenant Trigger so that such covenant is tested, and thereafter
Global Excess Availability, US Excess Availability and Canadian Excess
availability all increase so that the covenant ceases to be tested two (2) times
in any twelve (12) consecutive month period as provided above, then the third
time the covenant is tested in such twelve (12) consecutive month period, the
Fixed Charge Coverage Ratio will be tested until such time as the Global Excess
Availability is greater than twenty (20%) percent of the Maximum Credit, US
Excess Availability is greater than twenty (20%) percent of the US Loan Limit
and Canadian Excess Availability is greater than twenty (20%) percent of the
Canadian Loan Limit, in each case for sixty (60) consecutive days (and
thereafter only subject to the recurrence of a Covenant Trigger as provided
above).

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SECTION 12. EVENTS OF DEFAULT AND REMEDIES
     12.1 Events of Default. The occurrence or existence of any one or more of
the following events are referred to herein individually as an “Event of
Default”, and collectively as “Events of Default”:
          (a) (i) any Borrower fails to pay any of the Obligations when due or
(ii) any Borrower or Guarantor fails to perform any of the covenants contained
in Sections 9.2(b), 9.2(c), 9.3, 9.4, 9.7, 9.8, 10.7, and 10.8 of this Agreement
and such failure shall continue for fifteen (15) days; provided, that, such
fifteen (15) day period shall not apply in the case of: (A) any failure to
observe any such covenant which is not capable of being cured at all or within
such fifteen (15) day period or which has been the subject of a prior failure
within a six (6) month period or (B) an intentional breach by any Borrower or
Guarantor of any such covenant or (iii) any Borrower or Guarantor fails to
perform any of the terms, covenants, conditions or provisions contained in this
Agreement or any of the other Loan Documents other than those described in
Sections 12.1(a)(i) and 12.1(a)(ii) above;
          (b) any representation, warranty or statement of fact made by any
Borrower or Guarantor to Agent in this Agreement, the other Loan Documents or
any other written agreement, schedule, confirmatory assignment or otherwise
shall when made or deemed made be false or misleading in any material respect;
          (c) any Guarantor revokes or terminates or purports to revoke or
terminate or fails to perform any of the terms, covenants, conditions or
provisions of any guarantee, endorsement or other agreement of such party in
favor of Agent or any Lender;
          (d) any judgment for the payment of money is rendered against any
Borrower or Guarantor in excess of $2,000,000 in any one case or in excess of
$7,500,000 in the aggregate (to the extent not covered by insurance where the
insurer has assumed responsibility in writing for such judgment) and shall
remain undischarged or unvacated for a period in excess of thirty (30) days or
execution shall at any time not be effectively stayed, or any judgment other
than for the payment of money, or injunction, attachment, garnishment or
execution is rendered against any Borrower or Guarantor or any of the Collateral
having a value in excess of $500,000;
          (e) any Guarantor dissolves or suspends or discontinues doing business
except to the extent permitted under Section 10.1(c) hereof;
          (f) any Borrower or Guarantor makes an assignment for the benefit of
creditors, makes or sends notice of a bulk transfer or calls a meeting of its
creditors or principal creditors in connection with a moratorium or adjustment
of the Indebtedness due to them;
          (g) a case or proceeding under the bankruptcy laws of the United
States of America now or hereafter in effect or a petition, case, application or
proceeding under any bankruptcy or insolvency laws of Canada (including the
Bankruptcy and Insolvency Act (Canada) and the Companies’ Creditors Arrangement
Act (Canada)) or under any insolvency, reorganization, receivership,
readjustment of debt, dissolution or liquidation law or statute of any
jurisdiction now or hereafter in effect (whether at law or in equity) is filed
against any Borrower or Guarantor or all or any part of its properties and such
petition or application is not dismissed within forty-five (45) days after the
date of its filing or any Borrower or Guarantor shall file any answer admitting
or not contesting such petition or application or indicates its consent to,
acquiescence in or approval of, any such action or proceeding or the relief
requested is granted sooner;

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          (h) (i) a case or proceeding under the bankruptcy laws of the United
States of America now or hereafter in effect or under any insolvency,
reorganization, receivership, readjustment of debt, dissolution or liquidation
law or statute of any jurisdiction now or hereafter in effect (whether at a law
or equity) is filed by any Borrower or Guarantor or for all or any part of its
property or (ii) a petition, case, application or proceeding under any
bankruptcy or insolvency laws of Canada (including the Bankruptcy and Insolvency
Act (Canada) and the Companies’ Creditors Arrangement Act (Canada)), or any
similar law now or hereafter in effect in any jurisdiction or under any
insolvency, arrangement, reorganization, moratorium, administration,
receivership, readjustment of debt, dissolution or liquidation law or statute of
any jurisdiction now or hereafter in effect (whether at a law or equity) is
filed, taken or commenced after the date hereof by any Borrower or Guarantor or
any direct or indirect owner of any Equity Interest in Parent or for all or any
part of its property, including, without limitation, if any Borrower or Obligor
or any direct or indirect owner of any Equity Interest in Parent shall:
(A) apply for, request or consent to the appointment of a receiver,
administrative receiver, receiver and manager, examiner, judicial custodian,
trustee, liquidator, official manager, administrator, controller or any other
similar official of it or of all or a substantial part of its property and
assets, (B) be generally unable, or admit in writing its inability, to pay its
debts as they become due, (C) make a general assignment for the benefit of
creditors, (D) file a voluntary petition or assignment in bankruptcy or a
proposal seeking a reorganization, compromise, moratorium or arrangement with
its creditors, (E) take advantage of any insolvency or other similar law
pertaining to arrangements, moratoriums, compromises or reorganizations, or
admit the material allegations of a petition or application filed in respect of
it in any bankruptcy, reorganization or insolvency proceeding, or (F) take any
corporate action for the purpose of effecting any of the foregoing;
          (i) any default in respect of any Indebtedness of any Borrower or
Guarantor (other than Indebtedness owing to Agent and Lenders hereunder), in any
case in an amount in excess of $7,500,000, which default continues for more than
the applicable cure period, if any, with respect thereto or any default by any
Borrower or Guarantor under any Material Contract, which default continues for
more than the applicable cure period, if any, with respect thereto and/or is not
waived in writing by the other parties thereto;
          (j) any material provision hereof or of any of the other Loan
Documents shall for any reason cease to be valid, binding and enforceable with
respect to any party hereto or thereto (other than Agent) in accordance with its
terms, or any such party shall challenge the enforceability hereof or thereof,
or shall assert in writing, or take any action or fail to take any action based
on the assertion that any provision hereof or of any of the other Loan Documents
has ceased to be or is otherwise not valid, binding or enforceable in accordance
with its terms, or any security interest provided for herein or in any of the
other Loan Documents shall cease to be a valid and perfected first priority
security interest in any of the Collateral purported to be subject thereto
(except as otherwise permitted herein or therein);
          (k) failure of the chief financial officer of Associated Materials,
LLC to deliver a certificate required by Section 9.6(h) hereof as to which the
required certifications thereunder are true, complete and correct;
          (l) an ERISA Event shall occur which results in or could reasonably be
expected to result in liability of any Borrower in an aggregate amount in excess
of $5,000,000;
          (m) any Change of Control;
          (n) the indictment by any Governmental Authority, or as Agent may
reasonably and in good faith determine, the threatened indictment by any
Governmental Authority of any Borrower or Guarantor of which any Borrower,
Guarantor or Agent receives notice, in either case, as to which there is a
reasonable possibility of an adverse determination, in the good faith
determination of Agent, under any

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criminal statute, or commencement or threatened commencement of criminal or
civil proceedings against such Borrower or Guarantor, pursuant to which statute
or proceedings the penalties or remedies sought or available include forfeiture
of (i) any of the Collateral having a value in excess of $500,000 or (ii) any
other property of any Borrower or Guarantor which is necessary or material to
the conduct of its business;
          (o) a requirement from the Minister of National Revenue for payment
pursuant to Section 224 or any successor section of the Income Tax Act (Canada)
or Section 317, or any successor section in respect of the Excise Tax Act
(Canada) or any comparable provision of similar legislation shall have been
received by Agent or any Lender or any other Person in respect of any Lender or
otherwise issued in respect of Lender involving an amount in excess of the US
Dollar Equivalent of $1,000,000; or
          (p) there shall be an event of default under any of the other Loan
Documents.
     12.2 Remedies.
          (a) At any time an Event of Default exists or has occurred and is
continuing, Agent and Lenders shall have all rights and remedies provided in
this Agreement, the other Loan Documents, the UCC, the PPSA and other applicable
law, all of which rights and remedies may be exercised without notice to or
consent by any Borrower or Guarantor, except as such notice or consent is
expressly provided for hereunder or required by applicable law. All rights,
remedies and powers granted to Agent and Lenders hereunder, under any of the
other Loan Documents, the UCC, the PPSA or other applicable law, are cumulative,
not exclusive and enforceable, in Agent’s discretion, alternatively,
successively, or concurrently on any one or more occasions, and shall include,
without limitation, the right to apply to a court of equity for an injunction to
restrain a breach or threatened breach by any Borrower or Guarantor of this
Agreement or any of the other Loan Documents. Subject to Section 14 hereof,
Agent may, and at the direction of the Required Lenders shall, at any time or
times an Event of Default exists or has occurred and is continuing, proceed
directly against any Borrower or Guarantor to collect the Obligations without
prior recourse to the Collateral.
          (b) Without limiting the generality of the foregoing, at any time an
Event of Default exists or has occurred and is continuing, Agent may, at its
option and shall upon the direction of the Required Lenders, (i) upon notice to
Administrative Borrower, accelerate the payment of all Obligations and demand
immediate payment thereof to Agent for itself and the benefit of Lenders
(provided, that, upon the occurrence of any Event of Default described in
Sections 12.1(g) and 12.1(h), all Obligations shall automatically become
immediately due and payable), and (ii) terminate the Commitments whereupon the
obligation of each Lender to make any Loan and Issuing Bank to issue any Letter
of Credit shall immediately terminate (provided, that, upon the occurrence of
any Event of Default described in Sections 12.1(g) and 12.1(h), the Commitments
and any other obligation of the Agent or a Lender hereunder shall automatically
terminate).
          (c) Without limiting the foregoing, at any time an Event of Default
exists or has occurred and is continuing and only at such time or times, Agent
may, in its reasonably discretion (i) with or without judicial process or the
aid or assistance of others, enter upon any premises on or in which any of the
Collateral may be located and take possession of the Collateral or complete
processing, manufacturing and repair of all or any portion of the Collateral,
(ii) require any Borrower or Guarantor, at Borrowers’ expense, to assemble and
make available to Agent any part or all of the Collateral at any place and time
designated by Agent, (iii) collect, foreclose, receive, appropriate, setoff and
realize upon any and all Collateral, (iv) remove any or all of the Collateral
from any premises on or in which the same may be located for the purpose of
effecting the sale, foreclosure or other disposition thereof or for any other
purpose, (v) sell, lease, transfer, assign, deliver or otherwise dispose of any
and all Collateral (including entering into contracts with respect thereto,
public or private sales at any exchange, broker’s board, at any

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office of Agent or elsewhere) at such prices or terms as Agent may deem
reasonable, for cash, upon credit or for future delivery, with the Agent having
the right to purchase the whole or any part of the Collateral at any such public
sale, all of the foregoing being free from any right or equity of redemption of
any Borrower or Guarantor, which right or equity of redemption is hereby
expressly waived and released by Borrowers and Guarantors and/or (vi) terminate
this Agreement. If any of the Collateral is sold or leased by Agent upon credit
terms or for future delivery, the Obligations shall not be reduced as a result
thereof until payment therefor is finally collected by Agent. If notice of
disposition of Collateral is required by law, ten (10) days prior notice by
Agent to Administrative Borrower designating the time and place of any public
sale or the time after which any private sale or other intended disposition of
Collateral is to be made, shall be deemed to be reasonable notice thereof and,
to the fullest extent permitted by applicable law, Borrowers and Guarantors
waive any other notice. In the event Agent institutes an action to recover any
Collateral or seeks recovery of any Collateral by way of prejudgment remedy,
each Borrower and Guarantor waives the posting of any bond which might otherwise
be required. At any time an Event of Default exists or has occurred and is
continuing, upon Agent’s request, Borrowers will either, as Agent shall specify,
furnish cash collateral to Issuing Bank to be used to secure and fund the
reimbursement obligations to Issuing Bank in connection with any Letter of
Credit Obligations or furnish cash collateral to Agent for the Letter of Credit
Obligations. Such cash collateral shall be in the amount equal to one hundred
five (105%) percent of the amount of the Letter of Credit Obligations plus the
amount of any fees and expenses payable in connection therewith through the end
of the latest expiration date of the Letters of Credit giving rise to such
Letter of Credit Obligations.
          (d) At any time or times that an Event of Default exists or has
occurred and is continuing, Agent may, in its discretion, enforce the rights of
any Borrower or Guarantor against any account debtor, secondary obligor or other
obligor in respect of any of the Accounts or other Receivables. Without limiting
the generality of the foregoing, Agent may, in its discretion, at such time or
times (i) notify any or all account debtors, secondary obligors or other
obligors in respect thereof that the Receivables have been assigned to Agent and
that Agent has a security interest therein and Agent may direct any or all
account debtors, secondary obligors and other obligors to make payment of
Receivables directly to Agent, (ii) extend the time of payment of, compromise,
settle or adjust for cash, credit, return of merchandise or otherwise, and upon
any terms or conditions, any and all Receivables or other obligations included
in the Collateral and thereby discharge or release the account debtor or any
secondary obligors or other obligors in respect thereof without affecting any of
the Obligations, (iii) demand, collect or enforce payment of any Receivables or
such other obligations, but without any duty to do so, and Agent and Lenders
shall not be liable for any failure to collect or enforce the payment thereof
nor for the negligence of its agents or attorneys with respect thereto and (iv)
take whatever other action Agent may deem necessary or desirable for the
protection of its interests and the interests of Lenders. At any time that an
Event of Default exists or has occurred and is continuing, at Agent’s request,
all invoices and statements sent to any account debtor shall state that the
Accounts and such other obligations have been assigned to Agent and are payable
directly and only to Agent and Borrowers and Guarantors shall deliver to Agent
such originals of documents evidencing the sale and delivery of goods or the
performance of services giving rise to any Accounts as Agent may require. In the
event any account debtor returns Inventory when an Event of Default exists or
has occurred and is continuing, Borrowers shall, upon Agent’s request, hold the
returned Inventory in trust for Agent, segregate all returned Inventory from all
of its other property, dispose of the returned Inventory solely according to
Agent’s instructions, and not issue any credits, discounts or allowances with
respect thereto without Agent’s prior written consent.
          (e) To the extent that applicable law imposes duties on Agent or any
Lender to exercise remedies in a commercially reasonable manner (which duties
cannot be waived under such law), each Borrower and Guarantor acknowledges and
agrees that it is not commercially unreasonable for Agent or any Lender (i) to
fail to incur expenses reasonably deemed significant by Agent or any Lender to
prepare

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Collateral for disposition or otherwise to complete raw material or work in
process into finished goods or other finished products for disposition, (ii) to
fail to obtain third party consents for access to Collateral to be disposed of,
or to obtain or, if not required by other law, to fail to obtain consents of any
Governmental Authority or other third party for the collection or disposition of
Collateral to be collected or disposed of, (iii) to fail to exercise collection
remedies against account debtors, secondary obligors or other persons obligated
on Collateral or to remove liens or encumbrances on or any adverse claims
against Collateral, (iv) to exercise collection remedies against account debtors
and other persons obligated on Collateral directly or through the use of
collection agencies and other collection specialists, (v) to advertise
dispositions of Collateral through publications or media of general circulation,
whether or not the Collateral is of a specialized nature, (vi) to contact other
persons, whether or not in the same business as any Borrower or Guarantor, for
expressions of interest in acquiring all or any portion of the Collateral,
(vii) to hire one or more professional auctioneers to assist in the disposition
of Collateral, whether or not the collateral is of a specialized nature,
(viii) to dispose of Collateral by utilizing Internet sites that provide for the
auction of assets of the types included in the Collateral or that have the
reasonable capability of doing so, or that match buyers and sellers of assets,
(ix) to dispose of assets in wholesale rather than retail markets, (x) to
disclaim disposition warranties, (xi) to purchase insurance or credit
enhancements to insure Agent or Lenders against risks of loss, collection or
disposition of Collateral or to provide to Agent or Lenders a guaranteed return
from the collection or disposition of Collateral, or (xii) to the extent deemed
appropriate by Agent, to obtain the services of other brokers, investment
bankers, consultants and other professionals to assist Agent in the collection
or disposition of any of the Collateral. Each Borrower and Guarantor
acknowledges that the purpose of this Section is to provide non-exhaustive
indications of what actions or omissions by Agent or any Lender would not be
commercially unreasonable in the exercise by Agent or any Lender of remedies
against the Collateral and that other actions or omissions by Agent or any
Lender shall not be deemed commercially unreasonable solely on account of not
being indicated in this Section. Without limitation of the foregoing, nothing
contained in this Section shall be construed to grant any rights to any Borrower
or Guarantor or to impose any duties on Agent or Lenders that would not have
been granted or imposed by this Agreement or by applicable law in the absence of
this Section.
          (f) For the purpose of enabling Agent to exercise the rights and
remedies hereunder, each Borrower and Guarantor hereby grants to Agent, to the
extent assignable, an irrevocable, non-exclusive license (exercisable at any
time an Event of Default shall exist or have occurred and for so long as the
same is continuing) without payment of royalty or other compensation to any
Borrower or Guarantor, to use, assign, license or sublicense any of the
trademarks, service-marks, trade names, business names, trade styles, designs,
logos and other source of business identifiers and other Intellectual Property
and general intangibles now owned or hereafter acquired by any Borrower or
Guarantor, wherever the same maybe located, including in such license reasonable
access to all media in which any of the licensed items may be recorded or stored
and to all computer programs used for the compilation or printout thereof.
          (g) At any time an Event of Default exists or has occurred and is
continuing, Agent may apply the cash proceeds of Collateral actually received by
Agent from any sale, lease, foreclosure or other disposition of the Collateral
to payment of the Obligations, in whole or in part and in accordance with
Section 6.7 hereof, whether or not then due, or may hold such proceeds as cash
collateral for the Obligations. Borrowers and Guarantors shall remain liable to
Agent and Lenders for the payment of any deficiency with interest at the highest
rate provided for herein and all costs and expenses of collection or
enforcement, including attorneys’ fees and expenses.

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          (h) Without limiting the foregoing, upon the occurrence and during the
continuance of a Default or an Event of Default, (i) Agent and Lenders may, at
Agent’s option, and upon the occurrence and during the continuance of an Event
of Default at the direction of the Required Lenders, Agent and Lenders shall,
without notice, (A) cease making Loans or arranging for Letters of Credit or
reduce the lending formulas or amounts of Loans and Letters of Credit available
to Borrowers and/or (B) terminate any provision of this Agreement providing for
any future Loans to be made by Agent and Lenders or Letters of Credit to be
issued by Issuing Bank and (ii) Agent may, at its option, establish such
Reserves as Agent determines, without limitation or restriction, notwithstanding
anything to the contrary contained herein.
          (i) Agent may seek the appointment of a receiver, receiver-manager or
keeper (a “Receiver”) under the laws of Canada or any Province thereof to take
possession of all or any portion of the Collateral of a Canadian Borrower or to
operate same and, to the maximum extent permitted by law, may seek the
appointment of such a receiver without the requirement of prior notice or a
hearing. Any such Receiver shall, so far as concerns responsibility for his/her
acts, be deemed agent of Canadian Borrower and not Agent and the Lenders, and
Agent and the Lenders shall not be in any way responsible for any misconduct,
negligence or non-feasance on the part of any such Receiver, his/her servants or
employees. Subject to the provisions of the instrument appointing him/her, any
such Receiver shall have power to take possession of Collateral of a Canadian
Borrower, to preserve Collateral of a Canadian Borrower or its value, to carry
on or concur in carrying on all or any part of the business of a Canadian
Borrower and to sell, lease, license or otherwise dispose of or concur in
selling, leasing, licensing or otherwise disposing of Collateral of a Canadian
Borrower. To facilitate the forgoing powers, any such Receiver may, to the
exclusion of all others, including a Canadian Borrower, enter upon, use and
occupy all premises owned or occupied by a Canadian Borrower wherein Collateral
of a Canadian Borrower may be situated, maintain Collateral of a Canadian
Borrower upon such premises, borrow money on a secured or unsecured basis and
use Collateral of a Canadian Borrower directly in carrying on a Canadian
Borrower’s business or as security for loans or advances to enable the Receiver
to carry on a Canadian Borrower’s business or otherwise, as such Receiver shall,
in its discretion, determine. Except as may be otherwise directed by Agent, all
money received from time to time by such Receiver in carrying out his/her
appointment shall be received in trust for and paid over to Agent. Every such
Receiver may, in the discretion of Agent, be vested with all or any of the
rights and powers of Agent and the Canadian Lenders. Agent may, either directly
or through its nominees, exercise any or all powers and rights given to a
receiver by virtue of the foregoing provisions of this paragraph.
SECTION 13. JURY TRIAL WAIVER; OTHER WAIVERS
AND CONSENTS; GOVERNING LAW
     13.1 Governing Law; Choice of Forum; Service of Process; Jury Trial Waiver.
          (a) The validity, interpretation and enforcement of this Agreement and
the other Loan Documents (except as otherwise provided therein) and any dispute
arising out of the relationship between the parties hereto, whether in contract,
tort, equity or otherwise, shall be governed by the internal laws of the State
of New York but excluding any principles of conflicts of law or other rule of
law that would cause the application of the law of any jurisdiction other than
the laws of the State of New York.
          (b) Borrowers, Guarantors, Agent, Lenders and Issuing Bank irrevocably
consent and submit to the non-exclusive jurisdiction of the Supreme Court of the
State of New York for New York County and the United States District Court for
the Southern District of New York, whichever Agent may elect, and waive any
objection based on venue or forum non conveniens with respect to any action
instituted therein arising under this Agreement or any of the other Loan
Documents or in any way connected with or related or incidental to the dealings
of the parties hereto in respect of this Agreement or any of the other Loan
Documents or the transactions related hereto or thereto, in each case whether
now existing or hereafter arising, and whether in contract, tort, equity or
otherwise, and agree that any dispute with respect to any such matters shall be
heard only in the courts described above (except that Agent and

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Lenders shall have the right to bring any action or proceeding against any
Borrower or Guarantor or its or their property in the courts of any other
jurisdiction which Agent deems necessary or appropriate in order to realize on
the Collateral or to otherwise enforce its rights against any Borrower or
Guarantor or its or their property).
          (c) Each Borrower, Guarantor, Lender, Agent and Issuing Bank hereby
waives personal service of any and all process upon it and consents that all
such service of process may be made by certified mail (return receipt requested)
directed to its address set forth herein and service so made shall be deemed to
be completed five (5) days after the same shall have been so deposited in the
U.S. mails, or, at Agent’s option, by service upon any Borrower or Guarantor (or
Administrative Borrower on behalf of such Borrower or Guarantor) in any other
manner provided under the rules of any such courts. Within thirty (30) days
after such service, such Borrower or Guarantor shall appear in answer to such
process, failing which such Borrower or Guarantor shall be deemed in default and
judgment may be entered by Agent against such Borrower or Guarantor for the
amount of the claim and other relief requested.
          (d) BORROWERS, GUARANTORS, AGENT, LENDERS AND ISSUING BANK EACH HEREBY
WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION ARISING UNDER THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR IN ANY
WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES
HERETO IN RESPECT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR THE
TRANSACTIONS RELATED HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE.
BORROWERS, GUARANTORS, AGENT, LENDERS AND ISSUING BANK EACH HEREBY AGREES AND
CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED
BY COURT TRIAL WITHOUT A JURY AND THAT ANY BORROWER, ANY GUARANTOR, AGENT, ANY
LENDER OR ISSUING BANK MAY FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS
AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
          (e) Agent, Lenders and Issuing Bank shall not have any liability to
any Borrower or Guarantor (whether in tort, contract, equity or otherwise) for
losses suffered by such Borrower or Guarantor in connection with, arising out
of, or in any way related to the transactions or relationships contemplated by
this Agreement, or any act, omission or event occurring in connection herewith,
unless it is determined by a final and non-appealable judgment or court order
binding on Agent, such Lender and Issuing Bank, that the losses were the result
of acts or omissions constituting gross negligence or willful misconduct. Each
Borrower and Guarantor: (i) certifies that neither Agent, any Lender, Issuing
Bank nor any representative, agent or attorney acting for or on behalf of Agent,
any Lender or Issuing Bank has represented, expressly or otherwise, that Agent,
Lenders and Issuing Bank would not, in the event of litigation, seek to enforce
any of the waivers provided for in this Agreement or any of the other Loan
Documents and (ii) acknowledges that in entering into this Agreement and the
other Loan Documents, Agent, Lenders and Issuing Bank are relying upon, among
other things, the waivers and certifications set forth in this Section 13 and
elsewhere herein and therein.
     13.2 Waiver of Notices. Each Borrower and Guarantor hereby expressly waives
demand, presentment, protest and notice of protest and notice of dishonor with
respect to any and all instruments and chattel paper, included in or evidencing
any of the Obligations or the Collateral, and any and all other demands and
notices of any kind or nature whatsoever with respect to the Obligations, the
Collateral and this Agreement, except such as are expressly provided for herein.
No notice to or demand on any Borrower or Guarantor which Agent or any Lender
may elect to give shall entitle such Borrower or Guarantor to any other or
further notice or demand in the same, similar or other circumstances.

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     13.3 Amendments and Waivers.
          (a) Neither this Agreement nor any other Loan Document nor any terms
hereof or thereof may be amended, waived, discharged or terminated unless such
amendment, waiver, discharge or termination is in writing signed by Agent and
the Required Lenders or at Agent’s option, by Agent with the authorization or
consent of the Required Lenders, and as to amendments to any of the Loan
Documents (other than with respect to any provision of Section 14 hereof), by
any Borrower and such amendment, waiver, discharger or termination shall be
effective and binding as to all Lenders and Issuing Bank only in the specific
instance and for the specific purpose for which given; except, that, no such
amendment, waiver, discharge or termination shall:
               (i) reduce the interest rate or any fees or extend the time of
payment of principal, interest or any fees or reduce the principal amount of any
Loan or Letters of Credit, in each case without the consent of each Lender
directly affected thereby,
               (ii) increase the Commitment of any Lender over the amount
thereof then in effect or provided hereunder, in each case without the consent
of the Lender directly affected thereby,
               (iii) release any Collateral (except as expressly required
hereunder or under any of the other Loan Documents or applicable law and except
as permitted under Section 14.11(b) hereof), without the consent of Agent and
all of Lenders,
               (iv) reduce any percentage specified in the definition of
Required Lenders, without the consent of Agent and all of Lenders,
               (v) consent to the assignment or transfer by any Borrower or
Guarantor of any of their rights and obligations under this Agreement, without
the consent of Agent and all of Lenders,
               (vi) amend, modify or waive any terms of this Section 13.3
hereof, without the consent of Agent and all of Lenders, or
               (vii) increase the advance rates constituting part of the
Borrowing Base or increase the Inventory Loan Limit or the Letter of Credit
Limit, without the consent of Agent and all of Lenders.
Notwithstanding anything to the contrary contained herein, any amendment,
waiver, discharge or termination with respect to:
                    (A) the terms of Canadian Credit Facility exclusively (and
not terms of the US Credit Facility or terms applicable to both the Canadian
Credit Facility and the US Credit Facility), shall require the consent of Agent
and the Required Canadian Lenders, and
                    (B) the definition of “Canadian Borrowing Base” or any other
definition to the extent used in the determination thereof, or the definition of
“Canadian Loan Limit” or “Canadian Inventory Loan Limit”, shall require the
consent of Agent and all Canadian Lenders.
          (b) Agent, Lenders and Issuing Bank shall not, by any act, delay,
omission or otherwise be deemed to have expressly or impliedly waived any of its
or their rights, powers and/or remedies unless such waiver shall be in writing
and signed as provided herein. Any such waiver shall be enforceable only

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to the extent specifically set forth therein. A waiver by Agent, any Lender or
Issuing Bank of any right, power and/or remedy on any one occasion shall not be
construed as a bar to or waiver of any such right, power and/or remedy which
Agent, any Lender or Issuing Bank would otherwise have on any future occasion,
whether similar in kind or otherwise.
          (c) Notwithstanding anything to the contrary contained in
Section 13.3(a) above, in connection with any amendment, waiver, discharge or
termination, in the event that any Lender whose consent thereto is required
shall fail to consent or fail to consent in a timely manner (such Lender being
referred to herein as a “Non-Consenting Lender”), but the consent of any other
Lenders to such amendment, waiver, discharge or termination that is required are
obtained, if any, then Agent or Administrative Borrower shall have the right,
but not the obligation, at any time thereafter, and upon the exercise by Agent
or Administrative Borrower of such right, such Non-Consenting Lender shall have
the obligation, to sell, assign and transfer to Agent or such Eligible
Transferee as Agent may specify, the Commitment of such Non-Consenting Lender
and all rights and interests of such Non-Consenting Lender pursuant thereto.
Agent or Administrative Borrower shall provide the Non-Consenting Lender with
prior written notice of its intent to exercise its right under this Section,
which notice shall specify on date on which such purchase and sale shall occur.
Such purchase and sale shall be pursuant to the terms of an Assignment and
Acceptance (whether or not executed by the Non-Consenting Lender); except, that,
on the date of such purchase and sale, Agent, or such Eligible Transferee
specified by Agent, shall pay to the Non-Consenting Lender (except as Agent or
Administrative Borrower and such Non-Consenting Lender may otherwise agree) the
amount equal to: (i) the principal balance of the Loans held by the
Non-Consenting Lender outstanding as of the close of business on the business
day immediately preceding the effective date of such purchase and sale, plus
(ii) amounts accrued and unpaid in respect of interest and fees payable to the
Non-Consenting Lender to the effective date of the purchase (but in no event
shall the Non-Consenting Lender be deemed entitled to any early termination
fee). Such purchase and sale shall be effective on the date of the payment of
such amount to the Non-Consenting Lender and the Commitment of the
Non-Consenting Lender shall terminate on such date.
          (d) The consent of Agent shall be required for any amendment, waiver
or consent affecting the rights or duties of Agent hereunder or under any of the
other Loan Documents, in addition to the consent of the Lenders otherwise
required by this Section and the exercise by Agent of any of its rights
hereunder with respect to Reserves or Eligible Accounts or Eligible Inventory or
Eligible Equipment or Eligible Real Property shall not be deemed an amendment to
the advance rates provided for in this Section 13.3. The consent of Issuing Bank
shall be required for any amendment, waiver or consent affecting the rights or
duties of Issuing Bank hereunder or under any of the other Loan Documents, in
addition to the consent of the Lenders otherwise required by this Section;
provided, that, the consent of Issuing Bank shall not be required for any other
amendments, waivers or consents. Notwithstanding anything to the contrary
contained in Section 13.3(a) above, (i) in the event that Agent shall agree that
any items otherwise required to be delivered to Agent as a condition of the
initial Loans and Letters of Credit hereunder may be delivered after the date
hereof, Agent may, in its discretion, agree to extend the date for delivery of
such items or take such other action as Agent may deem appropriate as a result
of the failure to receive such items as Agent may determine or may waive any
Event of Default as a result of the failure to receive such items, in each case
without the consent of any Lender and (ii) Agent may consent to any change in
the type of organization, jurisdiction of organization or other legal structure
of any Borrower, Guarantor or any of their Subsidiaries and amend the terms
hereof or of any of the other Loan Documents as may be necessary or desirable to
reflect any such change, in each case without the approval of any Lender.
          (e) The consent of Agent and any Bank Product Provider that is
providing Bank Products and has outstanding any such Bank Products at such time
that are secured hereunder shall be required for any amendment to the priority
of payment of Obligations arising under or pursuant to any Hedge Agreements of a
Borrower or Guarantor or other Bank Products as set forth in Section 6.7(b)
hereof.

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          (f) Notwithstanding anything to the contrary herein, (i) the Fee
Letter may be amended, or rights or privileges thereunder waived, in a writing
executed only by the parties thereto, (ii) no Defaulting Lender shall have any
right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender, (iii) each Lender is entitled to vote as
such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code of the United States supersedes the unanimous consent
provisions set forth herein and (iv) Agent and the Required Lenders shall
determine whether or not to allow a Borrower or Guarantor to use cash collateral
in the context of a bankruptcy or insolvency proceeding and such determination
shall be binding on all of the Lenders.
          (g) Notwithstanding the foregoing, any provision of this Agreement may
be amended by an agreement in writing entered into by Borrowers and Agent with
the express consent of the Required Lenders (and, if its rights or obligations
are affected thereby, the Issuing Bank or Swing Line Lender) if (i) by the terms
of such agreement the Commitment of each Lender not consenting to the amendment
provided for therein shall terminate upon the effectiveness of such amendment
and (ii) at the time such amendment becomes effective, each Lender not
consenting thereto receives payment in full of the principal of and interest
accrued on each Loan made by it and all other amounts owing to it or accrued for
its account under this Agreement.
     13.4 Waiver of Counterclaims. Each Borrower and Guarantor waives all rights
to interpose any claims, deductions, setoffs or counterclaims of any nature
(other then compulsory counterclaims) in any action or proceeding with respect
to this Agreement, the Obligations, the Collateral or any matter arising
therefrom or relating hereto or thereto.
     13.5 Indemnification. Each Borrower and Guarantor shall, jointly and
severally, indemnify and hold Agent, each Lender and Issuing Bank, and their
respective officers, directors, agents, employees, advisors and counsel and
their respective Affiliates (each such person being an “Indemnitee”), harmless
from and against any and all losses, claims, damages, liabilities, costs or
expenses (including reasonable and documented attorneys’ fees and expenses)
imposed on, incurred by or asserted against any of them in connection with any
litigation, investigation, claim or proceeding commenced or threatened related
to the negotiation, preparation, execution, delivery, enforcement, performance
or administration of this Agreement, any other Loan Documents, or any
undertaking or proceeding related to any of the transactions contemplated hereby
or any act, omission, event or transaction related or attendant thereto,
including amounts paid in settlement, court costs, and the fees and expenses of
counsel except that Borrowers and Guarantors shall not have any obligation under
this Section 13.5 to indemnify an Indemnitee with respect to a matter covered
hereby resulting from (a) the gross negligence or willful misconduct of such
Indemnitee as determined pursuant to a final, non-appealable order of a court of
competent jurisdiction (but without limiting the obligations of Borrowers or
Guarantors as to any other Indemnitee) (b) to the extent they have been found by
a final, non-appealable judgment of a court of competent jurisdiction to have
resulted from the material breach of a material term of the Loan Documents by
such Indemnitee, or (c) arising out of any proceeding that does not result from
or arise out of an act or omission of any Borrower or Guarantor or any of their
Affiliates and that is brought by an Indemnitee against another Indemnitee. To
the extent that the undertaking to indemnify, pay and hold harmless set forth in
this Section may be unenforceable because it violates any law or public policy,
Borrowers and Guarantors shall pay the maximum portion which it is permitted to
pay under applicable law to Agent and Lenders in satisfaction of indemnified
matters under this Section. To the extent permitted by applicable law, no
Borrower or Guarantor shall assert, and each Borrower and Guarantor

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hereby waives, any claim against any Indemnitee, on any theory of liability for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, this
Agreement, any of the other Loan Documents or any undertaking or transaction
contemplated hereby(other than resulting from gross negligence or willful
misconduct of an Indemnitee as determined pursuant to a final, non-appealable
order of a court of competent jurisdiction). No Indemnitee referred to above
shall be liable for any damages arising from the use by unintended recipients of
any information or other materials distributed by it through telecommunications,
electronic or other information transmission systems in connection with this
Agreement or any of the other Loan Documents or the transaction contemplated
hereby or thereby. All amounts due under this Section shall be payable upon
demand. The foregoing indemnity shall survive the payment of the Obligations and
the termination or non-renewal of this Agreement
SECTION 14. THE AGENT
     14.1 Appointment, Powers and Immunities. Each Lender and Issuing Bank
irrevocably designates, appoints and authorizes Wachovia to act as Agent
hereunder and under the other Loan Documents with such powers as are
specifically delegated to Agent by the terms of this Agreement and of the other
Loan Documents, together with such other powers as are reasonably incidental
thereto. Agent (a) shall have no duties or responsibilities except those
expressly set forth in this Agreement and in the other Loan Documents, and shall
not by reason of this Agreement or any other Loan Document be a trustee or
fiduciary for any Lender; (b) shall not be responsible to Lenders for any
recitals, statements, representations or warranties contained in this Agreement
or in any of the other Loan Documents, or in any certificate or other document
referred to or provided for in, or received by any of them under, this Agreement
or any other Loan Document, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or any other document referred to or provided for herein or therein or
for any failure by any Borrower or any Guarantor or any other Person to perform
any of its obligations hereunder or thereunder; and (c) shall not be responsible
to Lenders for any action taken or omitted to be taken by it hereunder or under
any other Loan Document or under any other document or instrument referred to or
provided for herein or therein or in connection herewith or therewith, except
for its own gross negligence or willful misconduct as determined by a final
non-appealable judgment of a court of competent jurisdiction. Agent may employ
agents and attorneys in fact and shall not be responsible for the negligence or
misconduct of any such agents or attorneys in fact selected by it in good faith.
Agent may deem and treat the payee of any note as the holder thereof for all
purposes hereof unless and until the assignment thereof pursuant to an agreement
(if and to the extent permitted herein) in form and substance satisfactory to
Agent shall have been delivered to and acknowledged by Agent.
     14.2 Appointment for the Province of Québec. Without prejudice to
Section 14.1 above, all of the Secured Parties hereby appoints Agent as the
person holding the power of attorney (fondé pouvoir) of the Secured Parties as
contemplated under Article 2692 of the Civil Code of Québec, to enter into, to
take and to hold on their behalf, and for their benefit, any deed of hypothec
(“Deed of Hypothec”) to be executed by any of the Borrowers or Guarantors
granting a hypothec pursuant to the laws of the Province of Québec (Canada) and
to exercise such powers and duties which are conferred thereupon under such
deed. All of the Secured Parties hereby additionally appoints Agent as agent,
mandatary, custodian and depositary for and on behalf of the Secured Parties
(a) to hold and to be the sole registered holder of any bond (“Bond”) issued
under the Deed of Hypothec, the whole notwithstanding Section 32 of the Act
respecting the Special Powers of Legal Persons (Québec) or any other applicable
law, and (b) to enter into, to take and to hold on their behalf, and for their
benefit, a bond pledge agreement (“Pledge”) to be executed by such Borrower or
Guarantor pursuant to the laws of the Province of Québec and creating a pledge
Of the Bond as security for the payment and performance of, inter alia, the
Obligations. In this respect, (i) Agent as agent, mandatary, custodian and
depositary for and on behalf of the Secured Parties,

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shall keep a record indicating the names and addresses of, and the pro rata
portion of the obligations and indebtedness secured by the Pledge, owing to each
of the Secured Parties for and on behalf of whom the Bond is so held from time
to time, and (ii) each of the Secured Parties will be entitled to the benefits
of any property or assets charged under the Deed of Hypothec and the Pledge and
will participate in the proceeds of realization of any such property or assets.
Agent, in such aforesaid capacities shall (A) have the sole and exclusive right
and authority to exercise, except as may be otherwise specifically restricted by
the terms hereof, all rights and remedies given to Agent with respect to the
property or assets charged under the Deed of Hypothec and Pledge, any other
applicable law or otherwise, and (B) benefit from and be subject to all
provisions hereof with respect to the Agent mutatis mutandis, including, without
limitation, all such provisions with respect to the liability or responsibility
to and indemnification by the Secured Parties, the Borrowers or the Guarantors.
The execution prior to the date hereof by Agent of any Deed of hypothec, Pledge
or other security documents made pursuant to the laws of the Province of Québec
(Canada) is hereby ratified and confirmed.
     14.3 Reliance by Agent. Agent shall be entitled to rely upon any
certification, notice or other communication (including any thereof by
telephone, telecopy, telex, telegram or cable) believed by it to be genuine and
correct and to have been signed or sent by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel, independent
accountants and other experts selected by Agent. As to any matters not expressly
provided for by this Agreement or any other Loan Document, Agent shall in all
cases be fully protected in acting, or in refraining from acting, hereunder or
thereunder in accordance with instructions given by the Required Lenders or all
of Lenders as is required in such circumstance, and such instructions of such
Agents and any action taken or failure to act pursuant thereto shall be binding
on all Lenders.
     14.4 Events of Default.
          (a) Agent shall not be deemed to have knowledge or notice of the
occurrence of a Default or an Event of Default or other failure of a condition
precedent to the Loans and Letters of Credit hereunder, unless and until Agent
has received written notice from a Lender, or Borrower specifying such Event of
Default or any unfulfilled condition precedent, and stating that such notice is
a “Notice of Default or Failure of Condition”. In the event that Agent receives
such a Notice of Default or Failure of Condition, Agent shall give prompt notice
thereof to the Lenders. Agent shall (subject to Section 14.7) take such action
with respect to any such Event of Default or failure of condition precedent as
shall be directed by the Required Lenders to the extent provided for herein;
provided, that, unless and until Agent shall have received such directions,
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to or by reason of such Event of Default or
failure of condition precedent, as it shall deem advisable in the best interest
of Lenders. Without limiting the foregoing, and notwithstanding the existence or
occurrence and continuance of an Event of Default or any other failure to
satisfy any of the conditions precedent set forth in Section 4 of this Agreement
to the contrary, unless and until otherwise directed by the Required Lenders,
Agent may, but shall have no obligation to, continue to make Loans and Issuing
Bank may, but shall have no obligation to, issue or cause to be issued any
Letter of Credit for the ratable account and risk of Lenders from time to time
if Agent believes making such Loans or issuing or causing to be issued such
Letter of Credit is in the best interests of Lenders.
          (b) Except with the prior written consent of Agent, no Lender or
Issuing Bank may assert or exercise any enforcement right or remedy in respect
of the Loans, Letter of Credit Obligations or other Obligations, as against any
Borrower or Guarantor or any of the Collateral or other property of any Borrower
or Guarantor or otherwise under any of the Loan Documents.

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     14.5 Wachovia in its Individual Capacity. With respect to its Commitment
and the Loans made and Letters of Credit issued or caused to be issued by it
(and any successor acting as Agent), so long as Wachovia shall be a Lender
hereunder, it shall have the same rights and powers hereunder as any other
Lender and may exercise the same as though it were not acting as Agent, and the
term “Lender” or “Lenders” shall, unless the context otherwise indicates,
include Wachovia in its individual capacity as Lender hereunder. Wachovia (and
any successor acting as Agent) and its Affiliates may (without having to account
therefor to any Lender) lend money to, make investments in and generally engage
in any kind of business with Borrowers (and any of its Subsidiaries or
Affiliates) as if it were not acting as Agent, and Wachovia and its Affiliates
may accept fees and other consideration from any Borrower or Guarantor and any
of its Subsidiaries and Affiliates for services in connection with this
Agreement or otherwise without having to account for the same to Lenders.
     14.6 Indemnification. Lenders agree to indemnify Agent and Issuing Bank (to
the extent not reimbursed by Borrowers hereunder and without limiting any
obligations of Borrowers hereunder) ratably, in accordance with their Pro Rata
Shares, for any and all claims of any kind and nature whatsoever that may be
imposed on, incurred by or asserted against Agent (including by any Lender)
arising out of or by reason of any investigation in or in any way relating to or
arising out of this Agreement or any other Loan Document or any other documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby (including the costs and expenses that Agent is
obligated to pay hereunder) or the enforcement of any of the terms hereof or
thereof or of any such other documents; provided, that, no Lender shall be
liable for any of the foregoing to the extent it arises from the gross
negligence or willful misconduct of the party to be indemnified as determined by
a final non-appealable judgment of a court of competent jurisdiction. The
foregoing indemnity shall survive the payment of the Obligations and the
termination or non-renewal of this Agreement.
     14.7 Non-Reliance on Agent and Other Lenders. Each Lender agrees that it
has, independently and without reliance on Agent or other Lender, and based on
such documents and information as it has deemed appropriate, made its own credit
analysis of Borrowers and Guarantors and has made its own decision to enter into
this Agreement and that it will, independently and without reliance upon Agent
or any other Lender, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement or any of the other Loan
Documents. Agent shall not be required to keep itself informed as to the
performance or observance by any Borrower or Guarantor of any term or provision
of this Agreement or any of the other Loan Documents or any other document
referred to or provided for herein or therein or to inspect the properties or
books of any Borrower or Guarantor. Agent will use reasonable efforts to provide
Lenders with any information received by Agent from any Borrower or Guarantor
which is required to be provided to Lenders or deemed to be requested by Lenders
hereunder and with a copy of any Notice of Default or Failure of Condition
received by Agent from any Borrower or any Lender; provided, that, Agent shall
not be liable to any Lender for any failure to do so, except to the extent that
such failure is attributable to Agent’s own gross negligence or willful
misconduct as determined by a final non-appealable judgment of a court of
competent jurisdiction. Except for notices, reports and other documents
expressly required to be furnished to Lenders by Agent or deemed requested by
Lenders hereunder, Agent shall not have any duty or responsibility to provide
any Lender with any other credit or other information concerning the affairs,
financial condition or business of any Borrower or Guarantor that may come into
the possession of Agent.
     14.8 Failure to Act. Except for action expressly required of Agent
hereunder and under the other Loan Documents, Agent shall in all cases be fully
justified in failing or refusing to act hereunder and thereunder unless it shall
receive further assurances to its satisfaction from Lenders of their
indemnification obligations under Section 14.5 hereof against any and all
liability and expense that may be incurred by it by reason of taking or
continuing to take any such action.

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     14.9 Additional Loans. Agent shall not make any Revolving Loans or Issuing
Bank provide any Letter of Credit to any Borrower on behalf of Lenders
intentionally and with actual knowledge that such Revolving Loans or Letter of
Credit would cause the aggregate amount of the total outstanding Revolving Loans
and Letters of Credit to such Borrower to exceed the Borrowing Base of such
Borrower, without the prior consent of all Lenders; except, that, Agent may make
such additional Revolving Loans or Issuing Bank may provide such additional
Letter of Credit on behalf of Lenders, intentionally and with actual knowledge
that such Revolving Loans or Letter of Credit will cause the total outstanding
Revolving Loans and Letters of Credit to such Borrower to exceed the Borrowing
Base of such Borrower, as Agent may deem necessary or advisable in its
discretion; provided, that: (a) the total principal amount of the additional
Revolving Loans or additional Letters of Credit to any Borrower which Agent may
make or provide after obtaining such actual knowledge that the aggregate
principal amount of the Revolving Loans equal or exceed the Borrowing Bases of
Borrowers, plus the amount of Special Agent Advances made pursuant to
Section 14.11(a)(ii) hereof then outstanding, shall not exceed the aggregate
amount equal to seven and one-half (7 1/2%) percent of the Maximum Credit and
shall not cause the total principal amount of the Loans and Letters of Credit to
exceed the Maximum Credit and (b) no such additional Revolving Loan or Letter of
Credit shall be outstanding more than ninety (90) days after the date such
additional Revolving Loan or Letter of Credit is made or issued (as the case may
be), except as the Required Lenders may otherwise agree. Each Lender shall be
obligated to pay Agent the amount of its Pro Rata Share of any such additional
Revolving Loans or Letters of Credit.
     14.10 Concerning the Collateral and the Related Loan Documents. Each Lender
authorizes and directs Agent to enter into this Agreement and the other Loan
Documents. Each Lender agrees that any action taken by Agent or Required Lenders
in accordance with the terms of this Agreement or the other Loan Documents and
the exercise by Agent or Required Lenders of their respective powers set forth
therein or herein, together with such other powers that are reasonably
incidental thereto, shall be binding upon all of the Lenders.
     14.11 Field Audit, Examination Reports and other Information; Disclaimer by
Lenders. By signing this Agreement, each Lender:
          (a) is deemed to have requested that Agent furnish such Lender,
promptly after it becomes available, a copy of each field audit or examination
report and report with respect to the Borrowing Base prepared or received by
Agent (each field audit or examination report and report with respect to the
Borrowing Base being referred to herein as a “Report” and collectively,
“Reports”), appraisals with respect to the Collateral and financial statements
with respect to Parent and its Subsidiaries received by Agent;
          (b) expressly agrees and acknowledges that Agent (i) does not make any
representation or warranty as to the accuracy of any Report, appraisal or
financial statement or (ii) shall not be liable for any information contained in
any Report, appraisal or financial statement;
          (c) expressly agrees and acknowledges that the Reports are not
comprehensive audits or examinations, that Agent or any other party performing
any audit or examination will inspect only specific information regarding
Borrowers and Guarantors and will rely significantly upon Borrowers’ and
Guarantors’ books and records, as well as on representations of Borrowers’ and
Guarantors’ personnel; and
          (d) agrees to keep all Reports confidential and strictly for its
internal use in accordance with the terms of Section 13.5 hereof, and not to
distribute or use any Report in any other manner.
     14.12 Collateral Matters.

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          (a) Agent may, at its option, from time to time, at any time on or
after an Event of Default and for so long as the same is continuing or upon any
other failure of a condition precedent to the Loans and Letters of Credit
hereunder, make such disbursements and advances (“Special Agent Advances”) which
Agent, in its sole discretion, (i) deems necessary or desirable either to
preserve or protect the Collateral or any portion thereof or (ii) to enhance the
likelihood or maximize the amount of repayment by Borrowers and Guarantors of
the Loans and other Obligations; provided, that, (A) the aggregate principal
amount of the Special Agent Advances pursuant to this clause (ii) outstanding at
any time, plus the then outstanding principal amount of the additional Loans and
Letters of Credit which Agent may make or provide as set forth in Section 14.8
hereof, shall not exceed the amount equal to seven and one-half (7 1/2%) percent
of the Maximum Credit and (B) the aggregate principal amount of the Special
Agent Advances pursuant to this clause (ii) outstanding at any time, plus the
then outstanding principal amount of the Loans, shall not exceed the Maximum
Credit, except at Agent’s option; provided, that, to the extent that the
aggregate principal amount of Special Agent Advances plus the then outstanding
principal amount of the Loans exceed the Maximum Credit the Special Agent
Advances that are in excess of the Maximum Credit shall be for the sole account
and risk of Agent and notwithstanding anything to the contrary set forth below,
no Lender shall have any obligation to provide its share of such Special Agent
Advances in excess of the Maximum Credit, or (iii) to pay any other amount
chargeable to any Borrower or Guarantor pursuant to the terms of this Agreement
or any of the other Loan Documents consisting of (A) costs, fees and expenses
and (B) payments to Issuing Bank in respect of any Letter of Credit Obligations.
The Special Agent Advances shall be repayable on demand and together with all
interest thereon shall constitute Obligations secured by the Collateral. Special
Agent Advances shall not constitute Loans but shall otherwise constitute
Obligations hereunder. Interest on Special Agent Advances shall be payable at
the Interest Rate then applicable to Base Rate Loans and shall be payable on
demand. Without limitation of its obligations pursuant to Section 6.13, each
Lender agrees that it shall make available to Agent, upon Agent’s demand, in
immediately available funds, the amount equal to such Lender’s Pro Rata Share of
each such Special Agent Advance. If such funds are not made available to Agent
by such Lender, such Lender shall be deemed a Defaulting Lender and Agent shall
be entitled to recover such funds, on demand from such Lender together with
interest thereon for each day from the date such payment was due until the date
such amount is paid to Agent at the Federal Funds Rate for each day during such
period (as published by the Federal Reserve Bank of New York or at Agent’s
option based on the arithmetic mean determined by Agent of the rates for the
last transaction in overnight Federal funds arranged prior to 9:00 a.m. on that
day by each of the three leading brokers of Federal funds transactions in New
York City selected by Agent) and if such amounts are not paid within three
(3) days of Agent’s demand, at the highest Interest Rate provided for in
Section 3.1 hereof applicable to Base Rate Loans.
          (b) Lenders hereby irrevocably authorize Agent, at its option and in
its discretion to release any security interest in, mortgage or lien upon, any
of the Collateral (i) upon termination of the Commitments and payment and
satisfaction of all of the Obligations and delivery of cash collateral to the
extent required under Section 15.1 below, or (ii) constituting property being
sold or disposed of if Administrative Borrower or any Borrower or Guarantor
certifies to Agent that the sale or disposition is made in compliance with
Section 10.1 hereof (and Agent may rely conclusively on any such certificate,
without further inquiry), or (iii) constituting property in which any Borrower
or Guarantor did not own an interest at the time the security interest, mortgage
or lien was granted or at any time thereafter, or (iv) having a value in the
aggregate in any twelve (12) month period of less than $10,000,000, and to the
extent Agent may release its security interest in and lien upon any such
Collateral pursuant to the sale or other disposition thereof, such sale or other
disposition shall be deemed consented to by Lenders, or (v) if required or
permitted under the terms of any of the other Loan Documents, including any
intercreditor agreement, or (vi) approved, authorized or ratified in writing by
all of Lenders. Except as provided above, Agent will not release any security
interest in, mortgage or lien upon, any of the Collateral without the prior
written authorization of all of Lenders. Upon request by Agent at any time,
Lenders will promptly confirm in writing Agent’s authority to release particular
types or items of Collateral pursuant to this Section. In no event shall the
consent or approval of Issuing Bank to any release of Collateral be required.

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          (c) Without any manner limiting Agent’s authority to act without any
specific or further authorization or consent by the Required Lenders, each
Lender agrees to confirm in writing, upon request by Agent, the authority to
release Collateral conferred upon Agent under this Section. Agent shall (and is
hereby irrevocably authorized by Lenders to) execute such documents as may be
necessary to evidence the release of the security interest, mortgage or liens
granted to Agent upon any Collateral to the extent set forth above; provided,
that, (i) Agent shall not be required to execute any such document on terms
which, in Agent’s opinion, would expose Agent to liability or create any
obligations or entail any consequence other than the release of such security
interest, mortgage or liens without recourse or warranty and (ii) such release
shall not in any manner discharge, affect or impair the Obligations or any
security interest, mortgage or lien upon (or obligations of any Borrower or
Guarantor in respect of) the Collateral retained by such Borrower or Guarantor.
          (d) Agent shall have no obligation whatsoever to any Lender, Issuing
Bank or any other Person to investigate, confirm or assure that the Collateral
exists or is owned by any Borrower or Guarantor or is cared for, protected or
insured or has been encumbered, or that any particular items of Collateral meet
the eligibility criteria applicable in respect of the Loans or Letters of Credit
hereunder, or whether any particular reserves are appropriate, or that the liens
and security interests granted to Agent pursuant hereto or any of the Loan
Documents or otherwise have been properly or sufficiently or lawfully created,
perfected, protected or enforced or are entitled to any particular priority, or
to exercise at all or in any particular manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights,
authorities and powers granted or available to Agent in this Agreement or in any
of the other Loan Documents, it being understood and agreed that in respect of
the Collateral, or any act, omission or event related thereto, subject to the
other terms and conditions contained herein, Agent may act in any manner it may
deem appropriate, in its discretion, given Agent’s own interest in the
Collateral as a Lender and that Agent shall have no duty or liability whatsoever
to any other Lender or Issuing Bank.
     14.13 Agency for Perfection. Each Lender and Issuing Bank hereby appoints
Agent and each other Lender and Issuing Bank as agent and bailee for the purpose
of perfecting the security interests in and liens upon the Collateral of Agent
in assets which, in accordance with Article 9 of the UCC can be perfected only
by possession (or where the security interest of a secured party with possession
has priority over the security interest of another secured party) and Agent and
each Lender and Issuing Bank hereby acknowledges that it holds possession of any
such Collateral for the benefit of Agent as secured party. Should any Lender or
Issuing Bank obtain possession of any such Collateral, such Lender shall notify
Agent thereof, and, promptly upon Agent’s request therefor shall deliver such
Collateral to Agent or in accordance with Agent’s instructions.
     14.14 Successor Agent. Agent may resign as Agent upon thirty (30) days’
prior written notice to Lenders and Administrative Borrower. If Agent resigns
under this Agreement, the Required Lenders shall appoint from among the Lenders
a successor agent for Lenders which successor agent shall be subject to the
approval of Administrative Borrower if no Default or Event of Default shall
exist or have occurred and be continuing; provided, that, (a) such approval
shall not be unreasonably withheld, conditioned or delayed and (b) unless Agent
shall have received written notice from Administrative Borrower that
Administrative Borrower does not approve such successor agent within five
(5) Business Days after receipt by Administrative Borrower of the notice from
Agent that it is resigning, Administrative Borrower shall be deemed to have
given such approval. If no successor agent is appointed prior to the effective
date of the resignation of Agent (whether as a result of the failure of
Administrative Borrower to approve a successor agent or otherwise), Agent may
appoint, after consulting with Lenders

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and Administrative Borrower, a successor agent from among Lenders (and the
approval of Administrative Borrower shall not be required for such successor
agent). Upon the acceptance by the Lender so selected of its appointment as
successor agent hereunder, such successor agent shall succeed to all of the
rights, powers and duties of the retiring Agent and the term “Agent” as used
herein and in the other Loan Documents shall mean such successor agent and the
retiring Agent’s appointment, powers and duties as Agent shall be terminated.
After any retiring Agent’s resignation hereunder as Agent, the provisions of
this Section 12 shall inure to its benefit as to any actions taken or omitted by
it while it was Agent under this Agreement. If no successor agent has accepted
appointment as Agent by the date which is thirty (30) days after the date of a
retiring Agent’s notice of resignation, the retiring Agent’s resignation shall
nonetheless thereupon become effective and Lenders shall perform all of the
duties of Agent hereunder until such time, if any, as the Required Lenders
appoint a successor agent as provided for above. Any resignation of Agent
pursuant to this Section shall also constitute the resignation of Wachovia or
its successor as Swing Line Lender and Issuing Bank, and any successor agent
that is appointed pursuant to this Section shall, upon its acceptance of such
appointment, become the successor Swing Line Lender and Issuing Bank for all
purposes thereunder. At the time any such resignation or replacement shall
become effective, Borrowers shall pay the full outstanding principal amount of
all Swing Line Loans and all accrued and unpaid fees and expenses of the
retiring Swing Line Lender and Issuing Bank. From and after the effective date
of any such resignation or replacement, (i) the successor Issuing Bank shall
have all the rights and obligations of the Issuing Bank under this Agreement
with respect to Letters of Credit issued by it thereafter and (ii) the retiring
Issuing Bank shall remain a party hereto and shall continue to have all the
rights and obligations of an Issuing Bank under this Agreement with respect to
Letters of Credit issued by it prior to such resignation, but shall not be
required to issue additional Letters of Credit.
     14.15 Other Agent Designations. Agent may at any time and from time to time
determine that a Lender may, in addition, be a “Co-Agent”, “Syndication Agent”,
“Documentation Agent” or similar designation hereunder and enter into an
agreement with such Lender to have it so identified for purposes of this
Agreement. Any such designation shall be effective upon written notice by Agent
to Administrative Borrower of any such designation. Any Lender that is so
designated as a Co-Agent, Syndication Agent, Documentation Agent or such similar
designation by Agent shall have no right, power, obligation, liability,
responsibility or duty under this Agreement or any of the other Loan Documents
other than those applicable to all Lenders as such. Without limiting the
foregoing, the Lenders so identified shall not have or be deemed to have any
fiduciary relationship with any Lender and no Lender shall be deemed to have
relied, nor shall any Lender rely, on a Lender so identified as a Co-Agent,
Syndication Agent, Documentation Agent or such similar designation in deciding
to enter into this Agreement or in taking or not taking action hereunder.
SECTION 15. TERM OF AGREEMENT; MISCELLANEOUS
     15.1 Term.
          (a) This Agreement and the other Loan Documents shall become effective
as of the date set forth on the first page hereof and shall continue in full
force and effect for a term ending on the Maturity Date, unless sooner
terminated pursuant to the terms hereof. In addition, Borrowers may terminate
this Agreement at any time upon ten (10) days prior written notice to Agent
(which notice shall be irrevocable) and Agent may, at its option, and shall at
the direction of Required Lenders, terminate this Agreement at any time on or
after an Event of Default. Upon the effective date of termination of the Loan
Documents, Borrowers shall pay to Agent all outstanding and unpaid Obligations
and shall furnish cash collateral to Agent (or at Agent’s option, a letter of
credit issued for the account of Borrowers and at Borrowers’ expense, in form
and substance satisfactory to Agent, by an issuer acceptable to Agent and
payable to Agent as beneficiary) in such amounts as Agent determines are
reasonably necessary to secure Agent, Lenders and Issuing Bank from loss, cost,
damage or expense, including attorneys’ fees and

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expenses, in connection with any contingent Obligations, including issued and
outstanding Letter of Credit Obligations and checks or other payments
provisionally credited to the Obligations and/or as to which Agent or any Lender
has not yet received final and indefeasible payment and any continuing
obligations of Agent or any Lender pursuant to any Deposit Account Control
Agreement. The amount of such cash collateral (or letter of credit, as Agent may
determine) as to any Letter of Credit Obligations shall be in the amount equal
to one hundred five (105%) percent of the amount of the Letter of Credit
Obligations plus the amount of any fees and expenses payable in connection
therewith through the end of the latest expiration date of the Letters of Credit
giving rise to such Letter of Credit Obligations. Such payments in respect of
the Obligations and cash collateral shall be remitted by wire transfer in
Federal funds to the US Payment Account and/or Canadian Payment Account (as
applicable) or such other bank account of Agent, as Agent may, in its
discretion, designate in writing to Administrative Borrower for such purpose.
Interest shall be due until and including the next Business Day, if the amounts
so paid by Borrowers to the US Payment Account and/or Canadian Payment Account
(as applicable) or other bank account designated by Agent are received in such
bank account later than 12:00 noon.
          (b) No termination of the Commitments, this Agreement or any of the
other Loan Documents shall relieve or discharge any Borrower or Guarantor of its
respective duties, obligations and covenants under this Agreement or any of the
other Loan Documents until all Obligations have been fully and finally
discharged and paid, and Agent’s continuing security interest in the Collateral
and the rights and remedies of Agent and Lenders hereunder, under the other Loan
Documents and applicable law, shall remain in effect until all such Obligations
have been fully and finally discharged and paid. Accordingly, each Borrower and
Guarantor waives any rights it may have under the UCC to demand the filing of
termination statements with respect to the Collateral and Agent shall not be
required to send such termination statements to Borrowers or Guarantors, or to
file them with any filing office, unless and until this Agreement shall have
been terminated in accordance with its terms and all Obligations paid and
satisfied in full in immediately available funds.
     15.2 Interpretative Provisions.
          (a) All terms used herein which are defined in Article 1, Article 8 or
Article 9 of the UCC shall have the meanings given therein unless otherwise
defined in this Agreement.
          (b) All references to the plural herein shall also mean the singular
and to the singular shall also mean the plural unless the context otherwise
requires.
          (c) All references to any Borrower, Guarantor, Agent and Lenders
pursuant to the definitions set forth in the recitals hereto, or to any other
person herein, shall include their respective successors and assigns.
          (d) The words “hereof”, “herein”, “hereunder”, “this Agreement” and
words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not any particular provision of this Agreement and as
this Agreement now exists or may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced.
          (e) The word “including” when used in this Agreement shall mean
“including, without limitation” and the word “will” when used in this Agreement
shall be construed to have the same meaning and effect as the word “shall”.
          (f) An Event of Default shall exist or continue or be continuing until
such Event of Default is waived in accordance with Section 13.3 or is cured in a
manner satisfactory to Agent, if such Event of Default is capable of being cured
as determined by Agent.

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          (g) All references to the term “good faith” used herein when
applicable to Agent or any Lender shall mean, notwithstanding anything to the
contrary contained herein or in the UCC, honesty in fact in the conduct or
transaction concerned. Borrowers and Guarantors shall have the burden of proving
any lack of good faith on the part of Agent or any Lender alleged by any
Borrower or Guarantor at any time.
          (h) Any accounting term used in this Agreement shall have, unless
otherwise specifically provided herein, the meaning customarily given in
accordance with GAAP, and all financial computations hereunder shall be computed
unless otherwise specifically provided herein, in accordance with GAAP as
consistently applied and using the same method for inventory valuation as used
in the preparation of the financial statements of Parent most recently received
by Agent prior to the date hereof. Notwithstanding anything to the contrary
contained in GAAP or any interpretations or other pronouncements by the
Financial Accounting Standards Board or otherwise, the term “unqualified
opinion” as used herein to refer to opinions or reports provided by accountants
shall mean an opinion or report that does not include any explanation,
supplemental comment or other comment concerning the ability of the applicable
person to continue as a going concern or the scope of the audit.
          (i) In the computation of periods of time from a specified date to a
later specified date, the word “from” means “from and including”, the words “to”
and “until” each mean “to but excluding” and the word “through” means “to and
including”.
          (j) Unless otherwise expressly provided herein, (i) references herein
to any agreement, document or instrument shall be deemed to include all
subsequent amendments, modifications, supplements, extensions, renewals,
restatements or replacements with respect thereto, but only to the extent the
same are not prohibited by the terms hereof or of any other Loan Document, and
(ii) references to any statute or regulation are to be construed as including
all statutory and regulatory provisions consolidating, amending, replacing,
recodifying, supplementing or interpreting the statute or regulation.
          (k) The captions and headings of this Agreement are for convenience of
reference only and shall not affect the interpretation of this Agreement.
          (l) This Agreement and other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are cumulative and shall each be
performed in accordance with their terms.
          (m) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to Agent and the other
parties, and are the products of all parties. Accordingly, this Agreement and
the other Loan Documents shall not be construed against Agent or Lenders merely
because of Agent’s or any Lender’s involvement in their preparation.
     15.3 Notices.
          (a) All notices, requests and demands hereunder shall be in writing
and deemed to have been given or made: if delivered in person, immediately upon
delivery; if by telex, telegram or facsimile transmission, immediately upon
sending and upon confirmation of receipt; if by nationally recognized overnight
courier service with instructions to deliver the next Business Day, one (1)
Business Day after sending; and if by certified mail, return receipt requested,
five (5) days after mailing. Notices delivered through electronic communications
shall be effective to the extent set forth in Section 15.3(b) below. All
notices, requests and demands upon the parties are to be given to the following
addresses (or to such other address as any party may designate by notice in
accordance with this Section):

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  If to any Borrower or Guarantor:   Associated Materials, LLC
3773 State Road
Cuyahoga Falls, Ohio 44223
Attention: Ms. Cynthia L. Sobe, CFO
Telephone No.: 330-922-7743
Telecopy No.: 330-922-2296
 
       
 
  If to Agent or Issuing Bank:   Wachovia Bank, National Association
171 17th Street, NW
Atlanta, Georgia 30363
Attention: Portfolio Manager
Telephone No.: 404-214-3533
Telecopy No.: 404-214-7299

          (b) Notices and other communications to Agent, the Lenders and Issuing
Bank hereunder may be delivered or furnished by electronic communication
(including e-mail and Internet or intranet websites) pursuant to procedures
approved by Agent or as otherwise determined by Agent; provided, that, the
foregoing shall not apply to notices to any Lender or Issuing Bank pursuant to
Section 2 hereof if such Lender or Issuing Bank, as applicable, has notified
Agent that it is incapable of receiving notices under such Section by electronic
communication. Unless Agent otherwise requires, (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
shall be deemed to have been sent 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 communications is available and
identifying the website address therefor.
     15.4 Partial Invalidity. If any provision of this Agreement is held to be
invalid or unenforceable, such invalidity or unenforceability shall not
invalidate this Agreement as a whole, but this Agreement shall be construed as
though it did not contain the particular provision held to be invalid or
unenforceable and the rights and obligations of the parties shall be construed
and enforced only to such extent as shall be permitted by applicable law.
     15.5 Confidentiality.
          (a) Agent, each Lender and Issuing Bank shall use all reasonable
efforts to keep confidential, in accordance with its customary procedures for
handling confidential information and safe and sound lending practices, any
non-public information supplied to it by any Borrower or Guarantor pursuant to
this Agreement which is clearly and conspicuously marked as confidential at the
time such information is furnished by such Borrower to Agent, such Lender or
Issuing Bank; provided, that, nothing contained herein shall limit the
disclosure of any such information: (i) to the extent required by statute, rule,
regulation, subpoena or court order, (ii) to bank examiners and other
regulators, auditors and/or accountants, in connection with any litigation to
which Agent, such Lender or Issuing Bank is a party, (iii) to any Lender or
Participant (or prospective Lender or Participant) or Issuing Bank or to any
Affiliate of any Lender so long as such Lender, Participant (or prospective
Lender or Participant), Issuing Bank or Affiliate shall have been instructed to
treat such information as confidential in accordance with this Section 15.5, or
(iv) to counsel for Agent, any Lender, Participant (or prospective Lender or
Participant) or Issuing Bank.

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          (b) In the event that Agent, any Lender or Issuing Bank receives a
request or demand to disclose any confidential information pursuant to any
subpoena or court order, Agent or such Lender or Issuing Bank, as the case may
be, agrees (i) to the extent permitted by applicable law or if permitted by
applicable law, to the extent Agent or such Lender or Issuing Bank determines in
good faith that it will not create any risk of liability to Agent or such Lender
or Issuing Bank, Agent or such Lender or Issuing Bank will promptly notify
Administrative Borrower of such request so that Administrative Borrower may seek
a protective order or other appropriate relief or remedy and (ii) if disclosure
of such information is required, disclose such information and, subject to
reimbursement by Borrowers of Agent’s or such Lender’s or Issuing Bank’s
expenses, cooperate with Administrative Borrower in the reasonable efforts to
obtain an order or other reliable assurance that confidential treatment will be
accorded to such portion of the disclosed information which Administrative
Borrower so designates, to the extent permitted by applicable law or if
permitted by applicable law, to the extent Agent or such Lender or Issuing Bank
determines in good faith that it will not create any risk of liability to Agent
or such Lender or Issuing Bank.
          (c) In no event shall this Section 15.5 or any other provision of this
Agreement, any of the other Loan Documents or applicable law be deemed: (i) to
apply to or restrict disclosure of information that has been or is made public
by any Borrower, Guarantor or any third party or otherwise becomes generally
available to the public other than as a result of a disclosure in violation
hereof, (ii) to apply to or restrict disclosure of information that was or
becomes available to Agent, any Lender (or any Affiliate of any Lender) or
Issuing Bank on a non-confidential basis from a person other than a Borrower or
Guarantor, (iii) to require Agent, any Lender or Issuing Bank to return any
materials furnished by a Borrower or Guarantor to Agent, a Lender or Issuing
Bank or prevent Agent, a Lender or Issuing Bank from responding to routine
informational requests in accordance with the Code of Ethics for the Exchange of
Credit Information promulgated by The Robert Morris Associates or other
applicable industry standards relating to the exchange of credit information.
The obligations of Agent, Lenders and Issuing Bank under this Section 15.5 shall
supersede and replace the obligations of Agent, Lenders and Issuing Bank under
any confidentiality letter signed prior to the date hereof or any other
arrangements concerning the confidentiality of information provided by any
Borrower or Guarantor to Agent or any Lender. In addition, Agent and Lenders may
disclose information relating to the Credit Facility to Gold Sheets and other
publications, with such information to consist of deal terms and other
information customarily found in such publications and that Wachovia may
otherwise use the corporate name and logo of Borrowers and Guarantors or deal
terms in “tombstones” or other advertisements, public statements or marketing
materials.
     15.6 Successors. This Agreement, the other Loan Documents and any other
document referred to herein or therein shall be binding upon and inure to the
benefit of and be enforceable by Agent, Lenders, Issuing Bank, Borrowers,
Guarantors and their respective successors and assigns; except, that, Borrower
may not assign its rights under this Agreement, the other Loan Documents and any
other document referred to herein or therein without the prior written consent
of Agent and Lenders. Any such purported assignment without such express prior
written consent shall be void. No Lender may assign its rights and obligations
under this Agreement without the prior written consent of Agent, except as
provided in Section 15.7 below. The terms and provisions of this Agreement and
the other Loan Documents are for the purpose of defining the relative rights and
obligations of Borrowers, Guarantors, Agent, Lenders and Issuing Bank with
respect to the transactions contemplated hereby and there shall be no third
party beneficiaries of any of the terms and provisions of this Agreement or any
of the other Loan Documents.

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     15.7 Assignments; Participations.
          (a) Each Lender may make assignments of all or, if less than all, a
ratable portion of both its US Commitments and Canadian Commitments equal to at
least $5,000,000 in the aggregate for the assigning Lender, of such rights and
obligations under this Agreement to one or more Eligible Transferees (but not
including for this purpose any assignments in the form of a participation), each
of which assignees shall become a party to this Agreement as a Lender by
execution of an Assignment and Acceptance; provided, that, (i) such transfer or
assignment will not be effective until recorded by Agent on the Register and
(ii) Agent shall have received for its sole account payment of a processing fee
from the assigning Lender or the assignee in the amount of $5,000, and (iii) the
prior written approval of Agent and the Administrative Borrower shall have been
given, which approval by the Administrative Borrower shall not be unreasonably
withheld, conditioned or delayed; provided, that, (A) the approval of the
Administrative Borrower shall not be required at any time that an Event of
Default shall exist or have occurred and be continuing, and (B) the approval of
the Administrative Borrower shall not be required in connection with assignments
to other Lenders, to any Affiliate of a Lender, to any Approved Fund, or for any
participation and in any event, prior to a successful syndication except if it
is an institution on the list provided by Arrangers to the Administrative
Borrower prior to July 24, 2008 (but in no event shall an assignment be
permitted to any of the institutions which the Administrative Borrower has
previously identified to Arrangers in writing prior to the date hereof as those
to which the Administrative Borrower does not want Arrangers to offer
Commitments without the consent of the Administrative Borrower).
          (b) Agent shall maintain a register of the names and addresses of
Lenders, their Commitments and the principal amount of their Loans (the
“Register”). Agent shall also maintain a copy of each Assignment and Acceptance
delivered to and accepted by it and shall modify the Register to give effect to
each Assignment and Acceptance. The entries in the Register shall be conclusive
and binding for all purposes, absent manifest error, and any Borrowers,
Guarantors, Agent and Lenders may treat each Person whose name is recorded in
the Register as a Lender hereunder for all purposes of this Agreement. The
Register shall be available for inspection by Administrative Borrower and any
Lender at any reasonable time and from time to time upon reasonable prior
notice.
          (c) Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance, the
assignee thereunder shall be a party hereto and to the other Loan Documents and,
to the extent that rights and obligations hereunder have been assigned to it
pursuant to such Assignment and Acceptance, have the rights and obligations
(including, without limitation, the obligation to participate in Letter of
Credit Obligations) of a Lender hereunder and thereunder and the assigning
Lender shall, to the extent that rights and obligations hereunder have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under this Agreement.
          (d) By execution and delivery of an Assignment and Acceptance, the
assignor and assignee thereunder confirm to and agree with each other and the
other parties hereto as follows: (i) other than as provided in such Assignment
and Acceptance, the assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or any of the other
Loan Documents or the execution, legality, enforceability, genuineness,
sufficiency or value of this Agreement or any of the other Loan Documents
furnished pursuant hereto, (ii) the assigning Lender makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of any Borrower, Guarantor or any of their Subsidiaries or the performance or
observance by any Borrower or Guarantor of any of the Obligations; (iii) such
assignee confirms that it has received a copy of this Agreement and the other
Loan Documents, together with such other documents and information it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance, (iv) such assignee will,

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independently and without reliance upon the assigning Lender, Agent 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, (v) such assignee appoints and
authorizes Agent to take such action as agent on its behalf and to exercise such
powers under this Agreement and the other Loan Documents as are delegated to
Agent by the terms hereof and thereof, together with such powers as are
reasonably incidental thereto, and (vi) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of this Agreement and the other Loan Documents are required to be performed by
it as a Lender. Agent and Lenders may furnish any information concerning any
Borrower or Guarantor in the possession of Agent or any Lender from time to time
to assignees and Participants.
          (e) Each Lender may sell participations to one or more banks or other
entities in or to all or a portion of its rights and obligations under this
Agreement and the other Loan Documents (including, without limitation, all or a
portion of its Commitments and the Loans owing to it and its participation in
the Letter of Credit Obligations, without the consent of Agent or the other
Lenders); provided, that, (i) such Lender’s obligations under this Agreement
(including, without limitation, its Commitment hereunder) and the other Loan
Documents shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
and Borrowers, Guarantors, the other Lenders and Agent shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement and the other Loan Documents, and (iii) the
Participant shall not have any rights under this Agreement or any of the other
Loan Documents (the Participant’s rights against such Lender in respect of such
participation to be those set forth in the agreement executed by such Lender in
favor of the Participant relating thereto) and all amounts payable by any
Borrower or Guarantor hereunder shall be determined as if such Lender had not
sold such participation.
          (f) Nothing in this Agreement shall prevent or prohibit any Lender
from pledging its Loans hereunder to a Federal Reserve Bank in support of
borrowings made by such Lenders from such Federal Reserve Bank; provided, that,
no such pledge shall release such Lender from any of its obligations hereunder
or substitute any such pledgee for such Lender as a party hereto.
          (g) Borrowers and Guarantors shall assist Agent or any Lender
permitted to sell assignments or participations under this Section 15.7 in
whatever manner reasonably necessary in order to enable or effect any such
assignment or participation, including (but not limited to) the execution and
delivery of any and all agreements, notes and other documents and instruments as
shall be requested and the delivery of informational materials, appraisals or
other documents for, and the participation of relevant management in meetings
and conference calls with, potential Lenders or Participants. Borrowers shall
certify the correctness, completeness and accuracy, in all material respects, of
all descriptions of Borrowers and Guarantors and their affairs provided,
prepared or reviewed by any Borrower or Guarantor that are contained in any
selling materials and all other information provided by it and included in such
materials.
          (h) Any Lender that is an Issuing Bank may at any time assign all of
its Commitments pursuant to this Section 15.7. If such Issuing Bank ceases to be
Lender, it may, at its option, resign as Issuing Bank and such Issuing Bank’s
obligations to issue Letters of Credit shall terminate but it shall retain all
of the rights and obligations of Issuing Bank hereunder with respect to Letters
of Credit outstanding as of the effective date of its resignation and all Letter
of Credit Obligations with respect thereto (including the right to require
Lenders to make Revolving Loans or fund risk participations in outstanding
Letter of Credit Obligations), shall continue.

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     15.8 Entire Agreement. This Agreement, the other Loan Documents, any
supplements hereto or thereto, and any instruments or documents delivered or to
be delivered in connection herewith or therewith represents the entire agreement
and understanding concerning the subject matter hereof and thereof between the
parties hereto, and supersede all other prior agreements, understandings,
negotiations and discussions, representations, warranties, commitments,
proposals, offers and contracts concerning the subject matter hereof, whether
oral or written. In the event of any inconsistency between the terms of this
Agreement and any schedule or exhibit hereto, the terms of this Agreement shall
govern.
     15.9 USA Patriot Act. Each Lender subject to the USA PATRIOT Act (Title III
of Pub.L. 107-56 (signed into law October 26, 2001) (the “Act”) hereby notifies
Borrowers and Guarantors that pursuant to the requirements of the Act, it is
required to obtain, verify and record information that identifies each person or
corporation who opens an account and/or enters into a business relationship with
it, which information includes the name and address of Borrowers and Guarantors
and other information that will allow such Lender to identify such person in
accordance with the Act and any other applicable law. Borrowers and Guarantors
are hereby advised that any Loans or Letters of Credit hereunder are subject to
satisfactory results of such verification.
     15.10 Counterparts, Etc. This Agreement or any of the other Loan Documents
may be executed in any number of counterparts, each of which shall be an
original, but all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of this Agreement or any of the
other Loan Documents by telefacsimile or other electronic method of transmission
shall have the same force and effect as the delivery of an original executed
counterpart of this Agreement or any of such other Loan Documents. Any party
delivering an executed counterpart of any such agreement by telefacsimile or
other electronic method of transmission shall also deliver an original executed
counterpart, but the failure to do so shall not affect the validity,
enforceability or binding effect of such agreement.
     15.11 Judgment Currency. If, for the purposes of obtaining judgment in any
court in any jurisdiction with respect to this Agreement or any other Loan
Document, it becomes necessary to convert into the currency of such jurisdiction
(the “Judgment Currency”) any amount due under this Agreement or any other Loan
Document in any currency other than the Judgment Currency (the “Currency Due”),
then conversion shall be made at the Exchange Rate at which Agent is able, on
the relevant date, to purchase the Currency Due with the Judgment Currency
prevailing on the Business Day before the day on which judgment is given. In the
event that there is a challenge with respect to Exchange Rate prevailing between
the Business Day before the day on which the judgment is given and the date of
receipt by Agent of the amount due, Borrowers or Guarantors will, on the date of
receipt by Agent, pay such additional amounts, if any, or be entitled to receive
reimbursement of such amount, if any, as may be necessary to ensure that the
amount received by Agent on such date is the amount in the Judgment Currency
which when converted at the rate of exchange prevailing on the date of receipt
by Agent is the amount then due under this Agreement or any other Loan Document
in the Currency Due. If the amount of the Currency Due which Agent is able to
purchase is less than the amount of the Currency Due originally due to it,
Borrowers and Guarantors shall indemnify and save Agent harmless from and
against loss or damage arising as a result of such deficiency. The indemnity
contained herein shall constitute an obligation separate and independent from
the other obligations contained in this Agreement or any other Loan Document,
shall give rise to a separate and independent cause of action, shall apply
irrespective of any indulgence granted by Agent from time to time and shall
continue in full force effect notwithstanding any judgment or order for a
liquidated sum in respect of an amount due under this Agreement or any other
Loan Document or under any judgment or order.
[SIGNATURE PAGES FOLLOW]

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     IN WITNESS WHEREOF, Agent, Lenders, Borrowers and Guarantors have caused
these presents to be duly executed as of the day and year first above written.

            US BORROWERS:

ASSOCIATED MATERIALS, LLC
GENTEK BUILDING PRODUCTS, INC.
      By:   /s/ Cynthia Sobe         Name:   Cynthia Sobe        Title:   Vice
President, Chief Financial Officer, Treasurer & Secretary     

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            GUARANTORS:

ASSOCIATED MATERIALS HOLDINGS, LLC
      By:   /s/ Cynthia Sobe         Name:   Cynthia Sobe        Title:   Vice
President, Chief Financial Officer, Treasurer & Secretary     

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            ALSIDE, INC.
      By:   /s/ Cynthia Sobe         Name:   Cynthia Sobe        Title:   Vice
President, Treasurer & Secretary     

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            GENTEK HOLDINGS, LLC
      By:   /s/ Cynthia Sobe         Name:   Cynthia Sobe        Title:   Vice
President, Chief Financial Officer, Treasurer & Secretary     

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            CANADIAN BORROWER:

GENTEK BUILDING PRODUCTS LIMITED
      By:   /s/ Cynthia Sobe         Name:   Cynthia Sobe        Title:   Vice
President, Chief Financial Officer, Treasurer & Secretary     

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              ISSUING BANK:    
 
            WACHOVIA BANK, NATIONAL ASSOCIATION,
as Issuing Bank    
 
           
By:
  /s/ Michael E. Dawes              
 
  Name:   Michael E. Dawes    
 
           
 
  Title:   Director    
 
           

              US LENDERS:    
 
            WACHOVIA BANK, NATIONAL ASSOCIATION    
 
           
By:
  /s/ Michael E. Dawes              
 
  Name:   Michael E. Dawes    
 
           
 
  Title:   Director    
 
           

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        NATIONAL CITY BUSINESS CREDIT, INC.    
 
       
By:
  /s/ Todd W. Milenius    
 
       
Name:
  Todd W. Milenius    
Title:
  Vice President    

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        SUNTRUST BANK    
 
       
By:
  /s/ Patrick Wiggins    
 
       
Name:
  Patrick Wiggins    
Title:
  Vice President    

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        PNC BANK, NATIONAL ASSOCIATION    
 
       
By:
  /s/ C. Ray Hines    
 
       
Name:
  C. Ray Hines    
Title:
  Vice President    

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                UBS LOAN FINANCE LLC            
 
               
By:
  /s/ Irja R. Otsa   By:   /s/ Mary E. Evans    
 
               
Name:
  Irja R. Otsa   Name:   Mary E. Evans    
Title:
  Associate Director, Banking Products   Title:   Associate Director, Banking
Products    
 
  Services, US       Services, US    

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        FIFTH THIRD BANK    
 
       
By:
  /s/ Roy C. Lanctot    
 
       
Name:
  Roy C. Lanctot    
Title:
  Vice President    

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              CANADIAN LENDERS:    
 
            WACHOVIA CAPITAL FINANCE CORPORATION
(CANADA)    
 
           
By:
  /s/ Raymond Eghobamien              
 
  Name:   Raymond Eghobamien    
 
           
 
  Title:   Vice President    
 
           

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                      CIT BUSINESS CREDIT CANADA, INC.            
 
                   
By:
  /s/ Joseph Arnone       By:   /s/ Donald Rogers    
 
                   
Name:
  Joseph Arnone       Name:   Donald Rogers    
Title:
  Vice President       Title:   Senior Vice President    
 
                   

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          NATIONAL CITY BANK, CANADA
BRANCH    
 
       
By:
  /s/ Nazmin Adatia    
 
       
Name:
  Nazmin Adatia    
Title:
  Vice President, National City Bank,    
 
  Canada Branch    
 
       

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          SUNTRUST BANK    
 
       
By:
  /s/ Patrick Wiggins    
 
       
Name:
  Patrick Wiggins    
Title:
  Vice President    
 
       

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          PNC BANK, NATIONAL ASSOCIATION    
 
       
By:
  /s/ C. Ray Hines    
 
       
Name:
  C. Ray Hines    
Title:
  Vice President    
 
       

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                      UBS LOAN FINANCE LLC            
 
                   
By:
  /s/ Irja R. Otsa       By:   /s/ Mary E. Evans    
 
                   
Name:
  Irja R. Otsa       Name:   Mary E. Evans    
Title:
  Associate Director, Banking Products       Title:   Associate Director,
Banking Products    
 
  Services, US           Services, US    
 
                   

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EXHIBIT A
to
LOAN AND SECURITY AGREEMENT
ASSIGNMENT AND ACCEPTANCE AGREEMENT
     This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this “Assignment and Acceptance”)
dated as of                     , 20      is made between
                                         (the “Assignor”) and
                     (the “Assignee”).
WITNESSETH:
     WHEREAS, Wachovia Bank, National Association, in its capacity as agent
pursuant to the Loan Agreement (as hereinafter defined) acting for and on behalf
of the financial institutions which are parties thereto as lenders (in such
capacity, “Agent”), and the financial institutions which are parties to the Loan
Agreement as lenders (individually, each a “Lender” and collectively, “Lenders”)
have entered or are about to enter into financing arrangements pursuant to which
Agent and Lenders may make loans and advances and provide other financial
accommodations to Associated Materials, LLC, a Delaware corporation
(“Associated”), Gentek Building Products, Inc., a Delaware corporation
(“Gentek”, and, together with Associated, each individually a “US Borrower” and
collectively, “US Borrowers”), and Gentek Building Products Limited, a
corporation incorporated under the laws of the Province of Ontario, Canada
(“Canadian Borrower”, and together with US Borrowers, individually a “Borrower”
and collectively, “Borrowers”), as set forth in the Loan and Security Agreement,
dated September ___, 2008, by and among Borrowers, certain of their affiliates,
Agent and Lenders (as the same now exists or may hereafter be amended, modified,
supplemented, extended, renewed, restated or replaced, the “Loan Agreement”),
and the other agreements, documents and instruments referred to therein or at
any time executed and/or delivered in connection therewith or related thereto
(all of the foregoing, together with the Loan Agreement, as the same now exist
or may hereafter be amended, modified, supplemented, extended, renewed, restated
or replaced, being collectively referred to herein as the “Loan Documents”);
     WHEREAS, as provided under the Loan Agreement, Assignor committed to making
Loans (the “Committed Loans”) to Borrowers in an aggregate amount not to exceed
$                     (the “Commitment”);
     WHEREAS, Assignor wishes to assign to Assignee [part of the] [all] rights
and obligations of Assignor under the Loan Agreement in respect of its
Commitment in an amount equal to $                     (the “Assigned Commitment
Amount”) on the terms and subject to the conditions set forth herein and
Assignee wishes to accept assignment of such rights and to assume such
obligations from Assignor on such terms and subject to such conditions;
     NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:
     1. Assignment and Acceptance.
     (a) Subject to the terms and conditions of this Assignment and Acceptance,
Assignor hereby sells, transfers and assigns to Assignee, and Assignee hereby
purchases, assumes and undertakes from

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Assignor, without recourse and without representation or warranty (except as
provided in this Assignment and Acceptance) an interest in (i) the Commitment
and each of the Committed Loans of Assignor and (ii) all related rights,
benefits, obligations, liabilities and indemnities of the Assignor under and in
connection with the Loan Agreement and the other Loan Documents, so that after
giving effect thereto, the Commitment of Assignee shall be as set forth below
and the Pro Rata Share of Assignee shall be                      (___%) percent.
     (b) With effect on and after the Effective Date (as defined in Section 5
hereof), Assignee shall be a party to the Loan Agreement and succeed to all of
the rights and be obligated to perform all of the obligations of a Lender under
the Loan Agreement, including the requirements concerning confidentiality and
the payment of indemnification, with a Commitment in an amount equal to the
Assigned Commitment Amount. Assignee agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Loan Agreement
are required to be performed by it as a Lender. It is the intent of the parties
hereto that the Commitment of Assignor shall, as of the Effective Date, be
reduced by an amount equal to the Assigned Commitment Amount and Assignor shall
relinquish its rights and be released from its obligations under the Loan
Agreement to the extent such obligations have been assumed by Assignee;
provided, that, Assignor shall not relinquish its rights under Sections 2.2,
6.4, 6.9, 11.5 and 12.5 of the Loan Agreement to the extent such rights relate
to the time prior to the Effective Date.
     (c) After giving effect to the assignment and assumption set forth herein,
on the Effective Date Assignee’s Commitment will be $                    .
     (d) After giving effect to the assignment and assumption set forth herein,
on the Effective Date Assignor’s Commitment will be $                     (as
such amount may be further reduced by any other assignments by Assignor on or
after the date hereof).
     2. Payments.
     (a) As consideration for the sale, assignment and transfer contemplated in
Section 1 hereof, Assignee shall pay to Assignor on the Effective Date in
immediately available funds an amount equal to $                    ,
representing Assignee’s Pro Rata Share of the principal amount of all Committed
Loans.
     (b) Assignee shall pay to Agent the processing fee in the amount specified
in Section 13.7(a) of the Loan Agreement.
     3. Reallocation of Payments. Any interest, fees and other payments accrued
to the Effective Date with respect to the Commitment, Committed Loans and
outstanding Letters of Credit shall be for the account of Assignor. Any
interest, fees and other payments accrued on and after the Effective Date with
respect to the Assigned Commitment Amount shall be for the account of Assignee.
Each of Assignor and Assignee agrees that it will hold in trust for the other
party any interest, fees and other amounts which it may receive to which the
other party is entitled pursuant to the preceding sentence and pay to the other
party any such amounts which it may receive promptly upon receipt.
     4. Independent Credit Decision. Assignee acknowledges that it has received
a copy of the Loan Agreement and the Schedules and Exhibits thereto, together
with copies of the most recent financial statements of                      and
its Subsidiaries, and such other documents and information as it has deemed
appropriate to make its own credit and legal analysis and decision to enter into
this Assignment and Acceptance and agrees that it will, independently and
without reliance upon Assignor, Agent or any Lender and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit and legal decisions in taking or not taking action under the Loan
Agreement.

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     5. Effective Date; Notices.
     (a) As between Assignor and Assignee, the effective date for this
Assignment and Acceptance shall be                     , 200___ (the “Effective
Date”); provided, that, the following conditions precedent have been satisfied
on or before the Effective Date:
          (i) this Assignment and Acceptance shall be executed and delivered by
Assignor and Assignee;
          (ii) the consent of Agent as required for an effective assignment of
the Assigned Commitment Amount by Assignor to Assignee shall have been duly
obtained and shall be in full force and effect as of the Effective Date;
          (iii) written notice of such assignment, together with payment
instructions, addresses and related information with respect to Assignee, shall
have been given to Administrative Borrower and Agent;
          (iv) Assignee shall pay to Assignor all amounts due to Assignor under
this Assignment and Acceptance; and
          (v) the processing fee referred to in Section 2(b) hereof shall have
been paid to Agent.
     (b) Promptly following the execution of this Assignment and Acceptance,
Assignor shall deliver to Administrative Borrower and Agent for acknowledgment
by Agent, a Notice of Assignment in the form attached hereto as Schedule 1.
     6. Agent. [INCLUDE ONLY IF ASSIGNOR IS AN AGENT]
     (a) Assignee hereby appoints and authorizes Assignor in its capacity as
Agent to take such action as agent on its behalf to exercise such powers under
the Loan Agreement as are delegated to Agent by Lenders pursuant to the terms of
the Loan Agreement.
     (b) Assignee shall assume no duties or obligations held by Assignor in its
capacity as Agent under the Loan Agreement.]
     7. Withholding Tax. Assignee (a) represents and warrants to Assignor, Agent
and Borrowers that under applicable law and treaties no tax will be required to
be withheld by Assignee, Agent or Borrowers with respect to any payments to be
made to Assignee hereunder or under any of the Loan Documents, (b) agrees to
furnish (if it is organized under the laws of any jurisdiction other than the
United States or any State thereof) to Agent and Borrowers prior to the time
that Agent or Borrowers are required to make any payment of principal, interest
or fees hereunder, duplicate executed originals of either U.S. Internal Revenue
Service Form W-8BEN or W-8ECI, as applicable (wherein Assignee claims
entitlement to the benefits of a tax treaty that provides for a complete
exemption from U.S. federal income withholding tax on all payments hereunder)
and agrees to provide new such forms upon the expiration of any previously
delivered form or comparable statements in accordance with applicable U.S. law
and regulations and amendments thereto, duly executed and completed by Assignee,
and (c) agrees to comply with all applicable U.S. laws and regulations with
regard to such withholding tax exemption.
     8. Representations and Warranties.

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     (a) Assignor represents and warrants that (i) it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any security interest, lien, encumbrance or other
adverse claim, (ii) it is duly organized and existing and it has the full power
and authority to take, and has taken, all action necessary to execute and
deliver this Assignment and Acceptance and any other documents required or
permitted to be executed or delivered by it in connection with this Assignment
and Acceptance and to fulfill its obligations hereunder, (iii) no notices to, or
consents, authorizations or approvals of, any Person are required (other than
any already given or obtained) for its due execution, delivery and performance
of this Assignment and Acceptance, and apart from any agreements or undertakings
or filings required by the Loan Agreement, no further action by, or notice to,
or filing with, any Person is required of it for such execution, delivery or
performance, and (iv) this Assignment and Acceptance has been duly executed and
delivered by it and constitutes the legal, valid and binding obligation of
Assignor, enforceable against Assignor in accordance with the terms hereof,
subject, as to enforcement, to bankruptcy, insolvency, moratorium,
reorganization and other laws of general application relating to or affecting
creditors’ rights and to general equitable principles.
     (b) Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Loan Agreement or any of the other Loan
Documents or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Loan Agreement or any other instrument or document
furnished pursuant thereto. Assignor makes no representation or warranty in
connection with, and assumes no responsibility with respect to, the solvency,
financial condition or statements of Borrowers, Guarantors or any of their
respective Affiliates, or the performance or observance by Borrowers, Guarantors
or any other Person, of any of its respective obligations under the Loan
Agreement or any other instrument or document furnished in connection therewith.
     (c) Assignee represents and warrants that (i) it is duly organized and
existing and it has full power and authority to take, and has taken, all action
necessary to execute and deliver this Assignment and Acceptance and any other
documents required or permitted to be executed or delivered by it in connection
with this Assignment and Acceptance, and to fulfill its obligations hereunder,
(ii) no notices to, or consents, authorizations or approvals of, any Person are
required (other than any already given or obtained) for its due execution,
delivery and performance of this Assignment and Acceptance, and apart from any
agreements or undertakings or filings required by the Loan Agreement, no further
action by, or notice to, or filing with, any Person is required of it for such
execution, delivery or performance; and (iii) this Assignment and Acceptance has
been duly executed and delivered by it and constitutes the legal, valid and
binding obligation of Assignee, enforceable against Assignee in accordance with
the terms hereof, subject, as to enforcement, to bankruptcy, insolvency,
moratorium, reorganization and other laws of general application relating to or
affecting creditors’ rights to general equitable principles.
     9. Further Assurances. Assignor and Assignee each hereby agree to execute
and deliver such other instruments, and take such other action, as either party
may reasonably request in connection with the transactions contemplated by this
Assignment and Acceptance, including the delivery of any notices or other
documents or instruments to Borrowers or Agent, which may be required in
connection with the assignment and assumption contemplated hereby.
     10. Miscellaneous.
     (a) Any amendment or waiver of any provision of this Assignment and
Acceptance shall be in writing and signed by the parties hereto. No failure or
delay by either party hereto in exercising any right, power or privilege
hereunder shall operate as a waiver thereof and any waiver of any breach of the
provisions of this Assignment and Acceptance shall be without prejudice to any
rights with respect to any other for further breach thereof.

A-4

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     (b) All payments made hereunder shall be made without any set-off or
counterclaim.
     (c) Assignor and Assignee shall each pay its own costs and expenses
incurred in connection with the negotiation, preparation, execution and
performance of this Assignment and Acceptance.
     (d) This Assignment and Acceptance may be executed in any number of
counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
     (e) THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK. Assignor and Assignee each
irrevocably submits to the non-exclusive jurisdiction of any State or Federal
court sitting in New York County, New York over any suit, action or proceeding
arising out of or relating to this Assignment and Acceptance and irrevocably
agrees that all claims in respect of such action or proceeding may be heard and
determined in such New York State or Federal court. Each party to this
Assignment and Acceptance hereby irrevocably waives, to the fullest extent it
may effectively do so, the defense of an inconvenient forum to the maintenance
of such action or proceeding.
     (f) ASSIGNOR AND ASSIGNEE EACH HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH
THIS ASSIGNMENT AND ACCEPTANCE, THE LOAN AGREEMENT, ANY OF THE OTHER LOAN
DOCUMENTS OR ANY RELATED DOCUMENTS AND AGREEMENTS OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, OR STATEMENTS (WHETHER ORAL OR WRITTEN).
     IN WITNESS WHEREOF, Assignor and Assignee have caused this Assignment and
Acceptance to be executed and delivered by their duly authorized officers as of
the date first above written.

            [ASSIGNOR]
      By:           Title:                [ASSIGNEE]
      By:           Title:             

A-5

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SCHEDULE 1
NOTICE OF ASSIGNMENT AND ACCEPTANCE
___, 20__
                                                            
                                                            
                                                            
Attn.:                                         
Re:                                                             
Ladies and Gentlemen:
     Wachovia Bank, National Association, in its capacity as agent pursuant to
the Loan Agreement (as hereinafter defined) acting for and on behalf of the
financial institutions which are parties thereto as lenders (in such capacity,
“Agent”), and the financial institutions which are parties to the Loan Agreement
as lenders (individually, each a “Lender” and collectively, “Lenders”) have
entered or are about to enter into financing arrangements pursuant to which
Agent and Lenders may make loans and advances and provide other financial
accommodations to Associated Materials, LLC, a Delaware corporation
(“Associated”), Gentek Building Products, Inc., a Delaware corporation
(“Gentek”, and, together with Associated, each individually a “US Borrower” and
collectively, “US Borrowers”), and Gentek Building Products Limited, a
corporation incorporated under the laws of the Province of Ontario, Canada
(“Canadian Borrower”, and together with US Borrowers, individually a “Borrower”
and collectively, “Borrowers”), as set forth in the Loan and Security Agreement,
dated September ___, 2008, by and among Borrowers, certain of their affiliates,
Agent and Lenders (as the same now exists or may hereafter be amended, modified,
supplemented, extended, renewed, restated or replaced, the “Loan Agreement”),
and the other agreements, documents and instruments referred to therein or at
any time executed and/or delivered in connection therewith or related thereto
(all of the foregoing, together with the Loan Agreement, as the same now exist
or may hereafter be amended, modified, supplemented, extended, renewed, restated
or replaced, being collectively referred to herein as the “Loan Documents”).
Capitalized terms not otherwise defined herein shall have the respective
meanings ascribed thereto in the Loan Agreement.
     1. We hereby give you notice of, and request your consent to, the
assignment by                                          (the “Assignor”) to
                                      (the “Assignee”) such that after giving
effect to the assignment Assignee shall have an interest equal to
                     (___%) percent of the total Commitments pursuant to the
Assignment and Acceptance Agreement attached hereto (the “Assignment and
Acceptance”). We understand that the Assignor’s Commitment shall be reduced by
$                    , as the same may be further reduced by other assignments
on or after the date hereof.
     2. Assignee agrees that, upon receiving the consent of Agent to such
assignment, Assignee will be bound by the terms of the Loan Agreement as fully
and to the same extent as if the Assignee were the Lender originally holding
such interest under the Loan Agreement.

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     3. The following administrative details apply to Assignee:

                 
 
  (A)   Notice address:        
 
               
 
      Assignee name:        
 
               
 
      Address:        
 
               
 
      Attention:        
 
               
 
      Telephone:        
 
               
 
      Telecopier:        
 
               
 
               
 
  (B)   Payment instructions:        
 
               
 
      Account No.:        
 
               
 
      At:        
 
               
 
      Reference:        
 
               
 
      Attention:        
 
               

     4. You are entitled to rely upon the representations, warranties and
covenants of each of Assignor and Assignee contained in the Assignment and
Acceptance.

A-7

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     IN WITNESS WHEREOF, Assignor and Assignee have caused this Notice of
Assignment and Acceptance to be executed by their respective duly authorized
officials, officers or agents as of the date first above mentioned.

            Very truly yours,

[NAME OF ASSIGNOR]
      By:           Title:                  [NAME OF ASSIGNEE]
      By:           Title:         

              ACKNOWLEDGED AND ASSIGNMENT
CONSENTED TO:
WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent
 
           
By:
                     
 
  Title:        
 
           

A-8

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EXHIBIT B
TO
LOAN AND SECURITY AGREEMENT
BORROWING BASE CERTIFICATE
(See Attached)

B-1

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EXHIBIT C
TO
LOAN AND SECURITY AGREEMENT
INFORMATION CERTIFICATE
(See Attached)

C-1

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EXHIBIT E
TO
LOAN AND SECURITY AGREEMENT
COMPLIANCE CERTIFICATE

     
To:
  Wachovia Bank, National Association, as Agent
171 17th Street, NW
Atlanta, Georgia 30363

Ladies and Gentlemen:
     I hereby certify to you pursuant to Section 9.6 of the Loan Agreement (as
defined below) as follows:
     1. I am the duly elected Chief Financial Officer of                     , a
                     corporation,                     , a                     
corporation and                     , a                     corporation
(collectively, “Borrowers”). Capitalized terms used herein without definition
shall have the meanings given to such terms in the Loan and Security Agreement,
dated                     , 20___, by and among Wachovia Bank, National
Association, as agent for the financial institutions party thereto as lenders
(in such capacity, “Agent”) and the financial institutions party thereto as
lenders (collectively, “Lenders”), Borrowers and certain of their affiliates (as
such Loan and Security Agreement is amended, modified or supplemented, from time
to time, the “Loan Agreement”).
     2. I have reviewed the terms of the Loan Agreement, and have made, or have
caused to be made under my supervision, a review in reasonable detail of the
transactions and the financial condition of Borrowers and Guarantors, during the
immediately preceding fiscal month.
     3. The review described in Section 2 above did not disclose the existence
during or at the end of such fiscal month, and I have no knowledge of the
existence and continuance on the date hereof, of any condition or event which
constitutes a Default or an Event of Default, except as set forth on Schedule I
attached hereto. Described on Schedule I attached hereto are the exceptions, if
any, to this Section 3 listing, in detail, the nature of the condition or event,
the period during which it has existed and the action which any Borrower or
Guarantor has taken, is taking, or proposes to take with respect to such
condition or event.
     4. I further certify that, based on the review described in Section 2
above, no Borrower or Guarantor has at any time during or at the end of such
fiscal month, except as specifically described on Schedule II attached hereto or
as permitted by the Loan Agreement, done any of the following:
     (a) Changed its respective corporate name, or transacted business under any
trade name, style, or fictitious name, other than those previously described to
you and set forth in the Loan Documents.
     (b) Changed the location of its chief executive office, changed its
jurisdiction of incorporation, changed its type of organization or changed the
location of or disposed of any of its properties or assets (other than pursuant
to the sale of Inventory in the ordinary course of its business or as otherwise
permitted by Section 9.2 of the Loan Agreement), or established any new asset
locations.

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     (c) Materially changed the terms upon which it sells goods (including sales
on consignment) or provides services, nor has any vendor or trade supplier to
any Borrower or Guarantor during or at the end of such period materially
adversely changed the terms upon which it supplies goods to any Borrower or
Guarantor.
     (d) Permitted or suffered to exist any security interest in or liens on any
of its properties, whether real or personal, other than as specifically
permitted in the Loan Documents.
     (e) Received any notice of, or obtained knowledge of any of the following
not previously disclosed to Agent: (i) the occurrence of any event involving the
release, spill or discharge of any Hazardous Material in violation of applicable
Environmental Law in a material respect or (ii) any investigation, proceeding,
complaint, order, directive, claims, citation or notice with respect to: (A) any
non-compliance with or violation of any applicable Environmental Law by any
Borrower or Guarantor in any material respect or (B) the release, spill or
discharge of any Hazardous Material in violation of applicable Environmental Law
in a material respect or (C) the generation, use, storage, treatment,
transportation, manufacture, handling, production or disposal of any Hazardous
Materials in violation of applicable Environmental Laws in a material respect or
(D) any other environmental, health or safety matter, which has a material
adverse effect on any Borrower or Guarantor or its business, operations or
assets or any properties at which such Borrower or Guarantor transported, stored
or disposed of any Hazardous Materials.
     (f) Become aware of, obtained knowledge of, or received notification of,
any breach or violation of any material covenant contained in any instrument or
agreement in respect of Indebtedness for money borrowed by any Borrower or
Guarantor.
     5. Attached hereto as Schedule III are the calculations used in
determining, as of the end of such fiscal month whether Borrowers and Guarantors
are in compliance with the covenants set forth in Section 11.1 of the Loan
Agreement for such fiscal month.
     The foregoing certifications are made and delivered this day of
                    , 20     .

            Very truly yours,
       
        By:                   Title:        

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