Exhibit 10.2

EXECUTION FINAL

 

AMENDED AND RESTATED

CREDIT AGREEMENT

Dated as of October 28, 2011

among

STEIN MART, INC.,

as the Lead Borrower

For

The Borrowers Named Herein

The Facility Guarantors Named Herein

WELLS FARGO BANK, NATIONAL ASSOCIATION

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

The Other Lenders Party Hereto

and

WELLS FARGO CAPITAL FINANCE, LLC

as

Sole Lead Arranger and Sole Bookrunner

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TABLE OF CONTENTS

 

Section    Page

ARTICLE I DEFINITIONS AND ACCOUNTING TERMS

   1

1.01.

  

Defined Terms

   1

1.02.

  

Other Interpretive Provisions

   44

1.03.

  

Accounting Terms

   45

1.04.

  

Rounding

   46

1.05.

  

Times of Day

   46

1.06.

  

Letter of Credit Amounts

   46

1.07.

  

Currency Equivalents Generally

   46

ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONS

   46

2.01.

  

Committed Loans

   46

2.02.

  

Borrowings, Conversions and Continuations of Committed Loans

   47

2.03.

  

Letters of Credit

   49

2.04.

  

Swing Line Loans

   55

2.05.

  

Prepayments

   58

2.06.

  

Termination or Reduction of Commitments

   59

2.07.

  

Repayment of Loans

   60

2.08.

  

Interest

   60

2.09.

  

Fees

   60

2.10.

  

Computation of Interest and Fees

   61

2.11.

  

Evidence of Debt

   61

2.12.

  

Payments Generally; the Administrative Agent’s Clawback

   61

2.13.

  

Sharing of Payments by Lenders

   63

2.14.

  

Settlement Amongst Lenders

   64

2.15.

  

Increase in Commitments

   64

ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY; APPOINTMENT OF LEAD BORROWER

   66

3.01.

  

Taxes

   66

3.02.

  

Illegality

   67

3.03.

  

Inability to Determine Rates

   68

3.04.

  

Increased Costs; Reserves on LIBO Rate Loans

   68

3.05.

  

Compensation for Losses

   69

3.06.

  

Mitigation Obligations; Replacement of Lenders

   70

3.07.

  

Survival

   70

3.08.

  

Designation of Lead Borrower as Borrowers’ Agent

   70

ARTICLE IV CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

   71

4.01.

  

Conditions to Initial Credit Extension

   71

4.02.

  

Conditions to all Credit Extensions

   73

 

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ARTICLE V REPRESENTATIONS AND WARRANTIES

   74

5.01.

  

Existence, Qualification and Power

   74

5.02.

  

Authorization; No Contravention

   75

5.03.

  

Governmental Authorization; Other Consents

   75

5.04.

  

Binding Effect

   75

5.05.

  

Financial Statements; No Material Adverse Effect

   75

5.06.

  

Litigation

   76

5.07.

  

No Default

   76

5.08.

  

Ownership of Property; Liens

   76

5.09.

  

Environmental Compliance

   77

5.10.

  

Insurance

   77

5.11.

  

Taxes

   78

5.12.

  

ERISA Compliance

   78

5.13.

  

Subsidiaries; Equity Interests

   78

5.14.

  

Margin Regulations; Investment Company Act;

   79

5.15.

  

Disclosure

   79

5.16.

  

Compliance with Laws

   79

5.17.

  

Intellectual Property; Licenses, Etc.

   79

5.18.

  

Labor Matters

   80

5.19.

  

Security Documents

   80

5.20.

  

Solvency

   80

5.21.

  

Deposit Accounts; Credit Card Arrangements

   81

5.22.

  

Brokers

   81

5.23.

  

[Reserved]

   81

5.24.

  

Material Contracts

   81

5.25.

  

Casualty

   81

ARTICLE VI AFFIRMATIVE COVENANTS

   81

6.01.

  

Financial Statements

   81

6.02.

  

Certificates; Other Information

   82

6.03.

  

Notices

   85

6.04.

  

Payment of Obligations

   86

6.05.

  

Preservation of Existence, Etc.

   86

6.06.

  

Maintenance of Properties

   86

6.07.

  

Maintenance of Insurance

   86

6.08.

  

Compliance with Laws

   88

6.09.

  

Books and Records; Accountants

   88

6.10.

  

Inspection Rights

   88

6.11.

  

Use of Proceeds

   89

6.12.

  

Additional Loan Parties

   90

6.13.

  

Cash Management

   90

6.14.

  

Information Regarding the Collateral

   92

6.15.

  

Physical Inventories

   93

6.16.

  

Environmental Laws

   93

6.17.

  

Further Assurances

   93

6.18.

  

Compliance with Terms of Leaseholds

   94

6.19.

  

[Reserved]

   94

6.20.

  

Lender Meetings

   94

6.21.

  

[Reserved]

   94

6.22.

  

ERISA

   94

 

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ARTICLE VII NEGATIVE COVENANTS

   95

7.01.

  

Liens

   95

7.02.

  

Investments

   95

7.03.

  

Indebtedness; Disqualified Stock

   95

7.04.

  

Fundamental Changes

   95

7.05.

  

Dispositions

   96

7.06.

  

Restricted Payments

   96

7.07.

  

Prepayments of Indebtedness

   96

7.08.

  

Change in Nature of Business

   97

7.09.

  

Transactions with Affiliates

   97

7.10.

  

Burdensome Agreements

   97

7.11.

  

Use of Proceeds

   97

7.12.

  

Amendment of Material Documents

   97

7.13.

  

Fiscal Year

   97

7.14.

  

Deposit Accounts; Credit Card Processors

   97

7.15.

  

Financial Covenants

   97

ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES

   98

8.01.

  

Events of Default

   98

8.02.

  

Remedies Upon Event of Default

   101

8.03.

  

Application of Funds

   101

ARTICLE IX ADMINISTRATIVE AGENT

   103

9.01.

  

Appointment and Authority

   103

9.02.

  

Rights as a Lender

   103

9.03.

  

Exculpatory Provisions

   104

9.04.

  

Reliance by the Administrative Agent

   104

9.05.

  

Delegation of Duties

   105

9.06.

  

Resignation of the Administrative Agent

   105

9.07.

  

Non-Reliance on Administrative Agent and Other Lenders

   106

9.08.

  

No Other Duties, Etc.

   106

9.09.

  

Administrative Agent May File Proofs of Claim

   106

9.10.

  

Collateral and Guaranty Matters

   107

9.11.

  

Notice of Transfer

   107

9.12.

  

Reports and Financial Statements

   107

9.13.

  

Agency for Perfection

   108

9.14.

  

Indemnification of Administrative Agent

   108

9.15.

  

Relation among Lenders

   109

9.16.

  

Defaulting or Deteriorating Lender

   109

9.17.

  

Co-Syndication, Documentation Agent and Co-Lead Arrangers

   110

ARTICLE X MISCELLANEOUS

   110

10.01.

  

Amendments, Etc.

   110

10.02.

  

Notices; Effectiveness; Electronic Communications

   111

10.03.

  

No Waiver; Cumulative Remedies

   113

10.04.

  

Expenses; Indemnity; Damage Waiver

   113

10.05.

  

Payments Set Aside

   115

 

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10.06.

  

Successors and Assigns

   115

10.07.

  

Treatment of Certain Information; Confidentiality

   118

10.08.

  

Right of Setoff

   119

10.09.

  

Interest Rate Limitation

   119

10.10.

  

Counterparts; Integration; Effectiveness

   120

10.11.

  

Survival

   120

10.12.

  

Severability

   120

10.13.

  

Replacement of Lenders

   120

10.14.

  

Governing Law; Jurisdiction; Etc.

   121

10.15.

  

Waiver of Jury Trial

   122

10.16.

  

No Advisory or Fiduciary Responsibility

   122

10.17.

  

USA PATRIOT Act Notice

   123

10.18.

  

Foreign Asset Control Regulations

   123

10.19.

  

Time of the Essence

   123

10.20.

  

[Reserved]

   123

10.21.

  

Press Releases

   123

10.22.

  

Additional Waivers

   124

10.23.

  

No Strict Construction

   125

10.24.

  

Attachments

   125

10.25.

  

Restatement

   125

10.26.

  

Collateral Release on Termination

   126

SIGNATURES

   S-2

 

iv

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SCHEDULES

 

1.01(a)    Existing Letters of Credit 2.01    Commitments and Applicable
Percentages 5.01    Loan Parties Organizational Information 5.05    Supplement
to Interim Financial Statements 5.08(b)(1)    Owned Real Estate 5.08(b)(2)   
Leased Real Estate 5.09    Environmental Matters 5.10    Insurance 5.13   
Subsidiaries; Other Equity Investments 5.17    Intellectual Property Matters
5.18    Labor Matters 5.21(a)    DDAs 5.21(b)    Credit Card Arrangements 5.24
   Material Contracts 6.02    Financial and Collateral Reporting 7.01   
Existing Liens 7.02    Existing Investments 7.03    Existing Indebtedness 10.02
   Administrative Agent’s Office; Certain Addresses for Notices

EXHIBITS

 

     Form of A    Committed Loan Notice B    Swing Line Loan Notice C-1    Note
C-2    Swing Line Note D    Compliance Certificate E    Assignment and
Assumption F    Borrowing Base Certificate G    [Reserved] H    DDA Notification
I    Credit Card Notification

 

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AMENDED AND RESTATED

CREDIT AGREEMENT

This AMENDED AND RESTATED CREDIT AGREEMENT (“Agreement”) is entered into as of
October 28, 2011, among Stein Mart, Inc., a Florida corporation (“Stein Mart” or
the “Lead Borrower”), and Stein Mart Buying Corp., a Florida corporation
(“Buying Corp.”, and together with Stein Mart, each individually a “Borrower”
and collectively, “Borrowers”), the Facility Guarantors, each lender from time
to time party hereto (collectively, the “Lenders” and individually, a “Lender”),
and Wells Fargo Bank, National Association., as the Administrative Agent,
Collateral Agent, and Swing Line Lender.

The Borrowers have requested that the Lenders provide a revolving credit
facility, and the Lenders have indicated their willingness to lend and the LC
Issuer has indicated its willingness to issue Letters of Credit, in each case on
the terms and conditions set forth herein.

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

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

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

“15% Excess Availability” shall have the meaning provided in Section 6.10(b).

“50% Excess Availability” shall have the meaning provided in Section 6.10(b).

“Accelerated Borrowing Base Monthly Delivery Event” means the occurrence of
either of the following events at any time: (a) the occurrence and continuance
of any Event of Default, or (b) any Loans shall at any time be outstanding
hereunder. For purposes of this Agreement, the occurrence of an Accelerated
Borrowing Base Monthly Delivery Event shall be deemed continuing at the
Administrative Agent’s option (i) so long as such Event of Default is continuing
and has not been waived, and/or (ii) if the Accelerated Borrowing Base Monthly
Delivery Event arises as a result of there being any Loans outstanding
hereunder, there shall be no Loans outstanding hereunder for thirty
(30) consecutive calendar days following the payment in full of the applicable
Loans referenced in clause (b), in which case an Accelerated Borrowing Base
Monthly Delivery Event shall no longer be deemed to be continuing for purposes
of this Agreement.

“Accelerated Borrowing Base Weekly Delivery Event” means the occurrence of
either of the following events at any time: (a) the occurrence and continuance
of any Event of Default, or (b) Excess Availability is at any time less than
fifteen percent (15%) of the Loan Cap. For purposes of this Agreement, the
occurrence of an Accelerated Borrowing Base Weekly Delivery Event shall be
deemed continuing at the Administrative Agent’s option (i) so long as such Event
of Default is continuing and has not been waived, and/or (ii) if the Accelerated
Borrowing Base Weekly Delivery Event arises as a result of the Borrowers’
failure to achieve Excess Availability as required in clause (b) of this
definition, until either (A) the Excess Availability has exceeded fifteen
percent (15%) of the Loan Cap for thirty (30) consecutive calendar days, or
(B) there shall be no Loans outstanding hereunder for thirty (30) consecutive
calendar days following the payment in full of the applicable Loans referenced
in clause (b), in which case an Accelerated Borrowing Base Weekly Delivery Event
shall no longer be deemed to be continuing for purposes of this Agreement.

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“ACH” means automated clearing house transfers.

“Accommodation Payment” shall have the meaning provided in Section 10.22(d).

“Account” means “accounts” as defined in the UCC, and also means a right to
payment of a monetary obligation, whether or not earned by performance, (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
policy of insurance issued or to be issued, (d) for a secondary obligation
incurred or to be incurred, (e) for energy provided or to be provided, (f) for
the use or hire of a vessel under a charter or other contract, (g) arising out
of the use of a credit or charge card or information contained on or for use
with the card, or (h) as winnings in a lottery or other game of chance operated
or sponsored by a state, governmental unit of a state, or person licensed or
authorized to operate the game by a state or governmental unit of a state. The
term “Account” includes health-care-insurance receivables.

“Account Debtor” means each Person obligated in any way on or in connection with
an Account.

“Acquisition” means, with respect to any Person (a) a purchase or other
acquisition of a Controlling interest in the Equity Interests of any other
Person, (b) a purchase or other acquisition of all or substantially all of the
assets or properties of, another Person or of any business unit of another
Person, (c) any merger or consolidation of such Person with any other Person or
other transaction or series of transactions resulting in the acquisition of all
or substantially all of the assets, or a Controlling interest in the Equity
Interests, of any Person, or (d) any acquisition of all or substantially all of
the Store locations of any Person, in each case in any transaction or group of
transactions which are part of a common plan.

“Act” shall have the meaning provided in Section 10.17.

“Additional Commitment Lender” shall have the meaning provided in
Section 2.15(c).

“Adjusted LIBO Rate” means:

(a) for any Interest Period with respect to any LIBO Borrowing, an interest rate
per annum (rounded upwards, if necessary, to the next 1/16 of one percent) equal
to (i) the LIBO Rate for such Interest Period multiplied by (ii) the Statutory
Reserve Rate; and

(b) for any interest rate calculation with respect to any Base Rate Loan, an
interest rate per annum (rounded upwards, if necessary, to the next 1/100 of one
percent) equal to (i) the LIBO Rate for an Interest Period commencing on the
date of such calculation and ending on the date that is thirty (30) days
thereafter multiplied by (ii) the Statutory Reserve Rate.

The Adjusted LIBO Rate will be adjusted automatically as of the effective date
of any change in the Statutory Reserve Rate.

“Adjustment Date” means January 1, 2012 and the first day of each Fiscal Quarter
thereafter, commencing February 1, 2012.

“Administrative Agent” means Wells Fargo, in its capacity as administrative and
collateral agent under any of the Loan Documents, or any successor
administrative and collateral agent.

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

 

2

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

“Affiliate” means, with respect to any Person, (i) another Person that directly,
or indirectly through one or more intermediaries, Controls or is Controlled by
or is under common Control with the Person specified, (ii) any director,
officer, managing member, partner, trustee, or beneficiary of that Person,
(iii) any other Person directly or indirectly holding 10% or more of any class
of the Equity Interests of that Person, and (iv) any other Person 10% or more of
any class of whose Equity Interests is held directly or indirectly by that
Person.

“Agent Parties” shall have the meaning provided in Section 10.02(c).

“Agent Payment Account” means account no. 37235547964500212 of the
Administrative Agent at Wells Fargo, or such other account of the Administrative
Agent as the Administrative Agent may from time to time designate to Lead
Borrower as the Agent Payment Account for purposes of this Agreement and the
other Loan Documents.

“Aggregate Commitments” means the Commitments of all the Lenders. As of the
Closing Date, the Aggregate Commitments are $100,000,000.

“Agreement” means this Credit Agreement.

“Allocable Amount” shall have the meaning provided in Section 10.22(d).

“Applicable Commitment Fee Percentage” means (a) from and after the Closing Date
through and including December 31, 2011, one fifth of one percent (1/5%) per
annum; and (b) from and after January 1, 2012, one quarter of one percent
(1/4%) per annum.

“Applicable LC Fee Rate” means:

(a) from and after the Closing Date until the first Adjustment Date, 1.50% per
annum; and

(b) from and after the first Adjustment Date and on each Adjustment Date
thereafter, the Applicable LC Fee Rate shall be determined from the following
pricing grid based upon the Average Daily Availability for the most recent three
month period ended immediately preceding such Adjustment Date; provided, that,
(i) notwithstanding anything to the contrary set forth herein, upon the
occurrence and during the continuance of an Event of Default, the Administrative
Agent may, and at the direction of the Required Lenders shall, immediately
increase the Applicable LC Fee Rate to that set forth in Level III (even if the
Average Daily Availability requirements for a different Level have been met) and
interest shall accrue at the Default Rate and (ii) if any Borrowing Base
Certificate is at any time restated or otherwise revised (including as a result
of a field examination) or if the information set forth in any Borrowing Base
Certificate otherwise proves to be false or incorrect such that the Applicable
LC Fee Rate would have been higher than was otherwise in effect during any
period, without constituting a waiver of any Default or Event of Default arising
as a result thereof, Letter of Credit Fees due under this Agreement shall be
immediately recalculated at such higher rate for any applicable periods and
shall be due and payable on demand.

 

3

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Level

  

Average Daily

Availability

   Commercial
Letter of Credit
Fee     Standby
Letter of Credit
Fee  

I

  

Equal to or greater than 66% of the Loan Cap

     1.00 %      1.50 % 

II

  

Equal to or greater than 33% of the Loan Cap

     1.25 %      1.75 % 

III

  

Less than 33% of the Loan Cap

     1.50 %      2.00 % 

“Applicable Lenders” means the Required Lenders, the Supermajority Lenders, all
affected Lenders, or all Lenders, as the context may require.

“Applicable Margin” means:

(a) from and after the Closing Date through and including December 31, 2011, the
Applicable Margin shall be determined from the following pricing grid based upon
the Average Daily Availability for the most recent three month period ended
immediately preceding such Adjustment Date; provided, however, that
notwithstanding anything to the contrary set forth herein, upon the occurrence
and during the continuance of an Event of Default, the Administrative Agent may,
and at the direction of the Required Lenders shall, immediately increase the
Applicable Margin to that set forth in Level IV (even if the Average Daily
Availability requirements for a different Level have been met) and interest
shall accrue at the Default Rate; provided further if the foregoing financial
statements or any Borrowing Base Certificates are at any time restated or
otherwise revised (including as a result of an audit) or if the information set
forth in such financial statements or any Borrowing Base Certificates otherwise
proves to be false or incorrect such that the Applicable Margin would have been
higher than was otherwise in effect during any period, without constituting a
waiver of any Default or Event of Default arising as a result thereof, interest
due under this Agreement shall be immediately recalculated at such higher rate
for any applicable periods and shall be due and payable on demand.

 

Level

  

Average Daily

Availability

   LIBOR Margin     Base Rate Margin  

I

  

$140,000,000 or greater

     1.00 %      0 % 

II

  

Greater than or equal to $100,000,000 and less than $140,000,000

     1.25 %      0 % 

III

  

Greater than or equal to $20,000,000 and less than $100,000,000

     1.50 %      0.125 % 

IV

  

Less than $20,000,000

     1.75 %      0.25 % 

 

4

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(b) from and after the first Adjustment Date and on each Adjustment Date
thereafter, the Applicable Margin shall be determined from the following pricing
grid based upon the Average Daily Availability for the most recent three month
period ended immediately preceding such Adjustment Date; provided, however, that
notwithstanding anything to the contrary set forth herein, upon the occurrence
and during the continuance of an Event of Default, the Administrative Agent may,
and at the direction of the Required Lenders shall, immediately increase the
Applicable Margin to that set forth in Level III (even if the Average Daily
Availability requirements for a different Level have been met) and interest
shall accrue at the Default Rate; provided further if the foregoing financial
statements or any Borrowing Base Certificates are at any time restated or
otherwise revised (including as a result of an audit) or if the information set
forth in such financial statements or any Borrowing Base Certificates otherwise
proves to be false or incorrect such that the Applicable Margin would have been
higher than was otherwise in effect during any period, without constituting a
waiver of any Default or Event of Default arising as a result thereof, interest
due under this Agreement shall be immediately recalculated at such higher rate
for any applicable periods and shall be due and payable on demand.

 

Level

  

Average

Daily

Availability

   LIBOR
Margin     Base Rate Margin  

I

  

Equal to or greater than 66% of the Loan Cap

     1.50 %      0.50 % 

II

  

Equal to or greater than 33% of the Loan Cap

     1.75 %      0.75 % 

III

  

Less than 33% of the Loan Cap

     2.00 %      1.00 % 

“Applicable Percentage” means with respect to any Lender at any time, the
fraction, expressed as a percentage (carried out to the ninth decimal place),
the numerator of which is such Lender’s Commitment and the denominator of which
is the Aggregate Commitments at such time. If the Commitment of each Lender to
make Loans and the obligation of the LC Issuer to make LC Credit Extensions have
been terminated pursuant to Section 8.02 or if the Aggregate Commitments have
expired, then the Applicable Percentage of each Lender shall be determined based
on the Applicable Percentage of such Lender most recently in effect, giving
effect to any subsequent assignments. The initial Applicable Percentage of each
Lender is set forth opposite the name of such Lender on Schedule 2.01 (as
amended from time to time) or in the Assignment and Assumption pursuant to which
such Lender becomes a party hereto, as applicable.

“Approved Fund” means any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender, (c) an entity or an Affiliate of an entity that
administers or manages a Lender or (d) the same investment advisor or an advisor
under common control with such Lender, Affiliate or advisor, as applicable.

 

5

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“Arranger” means Wells Fargo Capital Finance, LLC, in its capacity as sole lead
arranger and sole book manager.

“Assignee Group” means two or more Eligible Assignees that are Affiliates of one
another or two or more Approved Funds managed by the same investment advisor.

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is
required by Section 10.06(b)), and accepted by the Administrative Agent, in
substantially the form of Exhibit E or any other form approved by the
Administrative Agent.

“Attributable Indebtedness” means, on any date, (a) in respect of any Capital
Lease Obligation of any Person, the capitalized amount thereof that would appear
on a balance sheet of such Person prepared as of such date in accordance with
GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized
amount of the remaining lease or similar payments under the relevant lease or
other applicable agreement or instrument that would appear on a balance sheet of
such Person prepared as of such date in accordance with GAAP if such lease,
agreement or instrument were accounted for as a capital lease.

“Audited Financial Statements” means the audited Consolidated balance sheet of
the Lead Borrower and its Subsidiaries for the Fiscal Year ended January 29,
2011, and the related Consolidated statements of income or operations,
Shareholders’ Equity and cash flows for such Fiscal Year of the Lead Borrower
and its Subsidiaries, including the notes thereto.

“Auto-Extension Letter of Credit” shall have the meaning provided in
Section 2.03(b)(iii).

“Availability Period” means the period from and including the Closing Date to
the earliest of (a) the Maturity Date, (b) the date of termination of the
Aggregate Commitments pursuant to Section 2.06, and (c) the date of termination
of the commitment of each Lender to make Loans and of the obligation of the LC
Issuer to make LC Credit Extensions pursuant to Section 8.02.

“Availability Reserves” means, without duplication of any other reserves or
items to the extent such items are otherwise addressed or excluded through
eligibility criteria, such reserves as the Administrative Agent from time to
time determines in its Permitted Discretion as being appropriate (a) to reflect
the impediments to the Administrative Agent’s ability to realize upon the
Collateral, (b) to reflect claims and liabilities that the Administrative Agent
determines will need to be satisfied in connection with the realization upon the
Collateral, (c) to reflect criteria, events, conditions, contingencies or risks
which adversely affect any component of the Borrowing Base, or the assets,
business, financial performance or financial condition of any Loan Party, or
(d) to reflect that an Event of Default then exists. Without limiting the
generality of the foregoing, Availability Reserves may include, in the
Administrative Agent’s Permitted Discretion, (but are not limited to) reserves
based on: (i) rent; (ii) customs duties, and other costs to release Inventory
which is being imported into the United States; (iii) outstanding Taxes and
other governmental charges, including, without limitation, ad valorem, real
estate, personal property, sales, claims of the PBGC and other Taxes which have
or are anticipated to have priority over the interests of the Administrative
Agent in the Collateral; (iv) Customer Credit Liabilities (which Reserve based
thereon is, as of the date hereof, equal to the aggregate amount of outstanding
Customer Credit Liabilities that, on any date of determination, arose at any
time during the ninety (90) days immediately preceding such date and fifty
(50%) percent of the aggregate amount of outstanding Customer Credit Liabilities
that arose at any time prior to the ninetieth (90th) day immediately preceding
such date, but without limiting the right of the Administrative Agent to adjust
such amount after the date hereof), (v) Customer Deposits, (vi) warehousemen’s
or bailee’s charges and other Permitted Encumbrances which may be pari passu or
have priority over the interests of the Administrative Agent in the Collateral,
(vii) amounts due to vendors on account of consigned goods, (viii) Cash
Management Reserves, (ix) Bank Product Reserves, (x) Inventory Reserves, and
(xi) royalties payable in respect of licensed merchandise.

 

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“Average Daily Availability” means the average daily Excess Availability for the
immediately preceding Fiscal Quarter.

“Bank Products” means any services of facilities provided to any Loan Party by
the Administrative Agent or any of its Affiliates (but excluding Cash Management
Services) including, without limitation, on account of (a) Swap Contracts,
(b) merchant services constituting a line of credit, (c) leasing, and (d) supply
chain finance services including, without limitation, trade payable services and
supplier accounts receivable purchases, but excluding any factoring services.

“Bank Product Obligations” means (a) any obligation on account of (i) any Cash
Management Services furnished to any of the Loan Parties or any of their
Subsidiaries and/or (ii) any transaction with the Administrative Agent or any of
its Affiliates, which arises out of any Bank Product entered into with any Loan
Party and any such Person, as each may be amended from time to time; and (b) any
liability with respect to Factored Receivables.

“Bank Product Reserves” means such reserves as the Administrative Agent from
time to time determine in its Permitted Discretion as being appropriate to
reflect the liabilities and obligations of the Loan Parties with respect to Bank
Products then provided or outstanding.

“Base Rate” means, for any day, a fluctuating rate per annum equal to the
highest of (a) the Federal Funds Rate, as in effect from time to time, plus
one-half of one percent (0.50%), (b) the Adjusted LIBO Rate plus one percent
(1.00%), or (c) the rate of interest in effect for such day as publicly
announced from time to time by Wells Fargo as its “prime rate.” The “prime rate”
is a rate set by Wells Fargo based upon various factors including Wells Fargo’s
costs and desired return, general economic conditions and other factors, and is
used as a reference point for pricing some loans, which may be priced at, above,
or below such announced rate. Any change in such rate announced by Wells Fargo
shall take effect at the opening of business on the day specified in the public
announcement of such change.

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

“Blocked Account” shall have the meaning provided in Section 6.13(a)(iii).

“Blocked Account Agreement” means with respect to an account established by a
Loan Party, an agreement, in form and substance satisfactory to the
Administrative Agent, establishing control (as defined in the UCC) of such
account by the Administrative Agent and whereby the bank maintaining such
account agrees, upon the occurrence and during the continuance of a Cash
Dominion Event, to comply only with the instructions originated by the
Administrative Agent without the further consent of any Loan Party.

“Blocked Account Bank” means each bank with whom deposit accounts are maintained
in which any funds of any of the Loan Parties from one or more DDAs are
concentrated and with whom a Blocked Account Agreement has been, or is required
to be, executed in accordance with the terms hereof.

“Borrower Materials” shall have the meaning provided in Section 6.02.

“Borrowers” shall have the meaning provided in the introductory paragraph
hereto.

 

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“Borrowing” means a Committed Borrowing or a Swing Line Borrowing, as the
context may require.

“Borrowing Base” means, at any time of calculation, an amount equal to:

(a) ninety percent (90%) multiplied by the Eligible Credit Card Receivables;

plus

(b) ninety percent (90%) of the Net Recovery Percentage multiplied by the Cost
of Eligible Inventory, net of Inventory Reserves;

minus

(c) the then amount of all Availability Reserves (without duplication of the
then amount of any Inventory Reserves).

“Borrowing Base Certificate” means a certificate substantially in the form of
Exhibit F hereto (with such changes therein as may be required by the
Administrative Agent to reflect the components of and applicable Availability
Reserves against the Borrowing Base as provided for hereunder from time to
time), executed and certified as accurate and complete by a Responsible Officer
of the Lead Borrower which shall include appropriate exhibits, schedules,
supporting documentation, and additional reports as reasonably requested by the
Administrative Agent.

“Business” means Borrowers’ value department store chain retailing apparel,
household consumer goods and other businesses reasonably related thereto.

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

“Capital Expenditures” means, with respect to any Person for any period, (a) all
expenditures made (whether made in the form of cash or other property) or costs
incurred for the acquisition or improvement of fixed or capital assets of such
Person (excluding normal replacements and maintenance which are properly charged
to current operations), in each case that are (or should be) set forth as
capital expenditures in a Consolidated statement of cash flows of such Person
for such period, in each case prepared in accordance with GAAP, and (b) Capital
Lease Obligations incurred by a Person during such period.

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

“Cash Collateralize” shall have the meaning provided in Section 2.03(g).
Derivatives of such term have corresponding meanings.

 

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“Cash Dominion Event” means either (a) the occurrence and continuance of any
Event of Default, or (b) the failure of the Borrowers to maintain Excess
Availability of the greater of at least (i) Fifteen Million Dollars
($15,000,000), or (ii) fifteen percent (15%) of the Loan Cap at any time. For
purposes of this Agreement, the occurrence of a Cash Dominion Event shall be
deemed continuing at the Administrative Agent’s option (A) so long as such Event
of Default and is continuing and has not been waived, and/or (B) if the Cash
Dominion Event arises as a result of the Borrowers’ failure to achieve Excess
Availability as required hereunder, until Excess Availability has exceeded the
greater of (x) Fifteen Million Dollars ($15,000,000), or (y) fifteen percent
(15%) of the Loan Cap for ninety (90) consecutive Business Days, in which case a
Cash Dominion Event shall no longer be deemed to be continuing for purposes of
this Agreement; provided that a Cash Dominion Event shall be deemed continuing
(even if an Event of Default is no longer continuing and/or Excess Availability
exceeds the required amount for ninety (90) consecutive Business Days) at all
times after a Cash Dominion Event has occurred and been discontinued on two
(2) occasion(s) after the Closing Date. The termination of a Cash Dominion Event
as provided herein shall in no way limit, waive or delay the occurrence of a
subsequent Cash Dominion Event in the event that the conditions set forth in
this definition again arise.

“Cash Management Letter” means the letter agreement dated as of the Closing
Date, among the Borrowers and the Administrative Agent, providing for certain
matters related to Cash Management Services to be provided by Wells Fargo.

“Cash Management Reserves “ means such reserves as the Administrative Agent,
from time to time, determines in its Permitted Discretion as being appropriate
to reflect the reasonably anticipated liabilities and obligations of the Loan
Parties with respect to Cash Management Services then provided or outstanding.

“Cash Management Services” means any one or more of the following types of
services or facilities provided to any Loan Party by the Administrative Agent or
any of its Affiliates: (a) ACH transactions, (b) cash management services,
including, without limitation, controlled disbursement services, treasury,
depository, overdraft, and electronic funds transfer services, (c) foreign
exchange facilities, (d) credit or debit cards, (e) credit card processing
services, and (f) purchase cards.

“CERCLA” means the Comprehensive Environmental Response, Compensation, and
Liability Act, 42 U.S.C. § 9601 et seq.

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

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

“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.

“Change of Control” means an event or series of related events by which:

(a) the transfer (in one transaction or a series of transactions) of all or
substantially all of the assets of Lead Borrower 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 7.05 hereof; or

 

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(b) the liquidation or dissolution of any Borrower or the adoption of a plan by
the stockholders of any Borrower relating to the dissolution or liquidation of
such Borrower, other than as permitted in Section 7.04 hereof; or

(c) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, but excluding (i) any Person who is a
direct or indirect shareholder of the Lead Borrower as of the date hereof and
(ii) any employee benefit plan of such person or its subsidiaries, and any
person or entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have “beneficial ownership” of all securities
that such person or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time (such right, an
“option right”)), directly or indirectly, a majority of the voting power of the
total outstanding Equity Interests of the Lead Borrower entitled to vote for
members of the board of directors or equivalent governing body of the Lead
Borrower on a fully-diluted basis (and taking into account all such Equity
Interests that such “person” or “group” has the right to acquire pursuant to any
option right); or

(d) during any period of two (2) consecutive years, a majority of the members of
the board of directors or other equivalent governing body of the Lead Borrower
cease to be composed of individuals (i) who were members of that board or
equivalent governing body on the first day of such period, (ii) whose election
or nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least sixty-six and two-thirds (66 2/3%) percent of
that board or equivalent governing body or (iii) whose election or nomination to
that board or other equivalent governing body was approved by individuals
referred to in clauses (i) and (ii) above constituting at the time of such
election or nomination at least sixty-six and two-thirds (66 2/3%) percent of
that board or equivalent governing body (excluding, in the case of both clause
(ii) and clause (iii), any individual whose initial nomination for, or
assumption of office as, a member of that board or equivalent governing body
occurs as a result of solicitation of proxies or consents for the election or
removal of one or more directors by any person or group by or on behalf of the
board of directors); or

(e) any Person or two or more Persons acting in concert shall have acquired by
contract or otherwise, or shall have entered into a contract or arrangement
that, upon consummation thereof, will result in its or their acquisition of the
power to exercise, directly or indirectly, a controlling influence over the
management or policies of the Lead Borrower, or control over the Equity
Interests of the Lead Borrower entitled to vote for members of the board of
directors or equivalent governing body of the Borrower on a fully-diluted basis
(and taking into account all such securities that such Person or Persons have
the right to acquire pursuant to any option right) representing a majority of
the combined voting power of such securities; or

(f) the Lead Borrower fails at any time to own, directly or indirectly, 80% of
the Equity Interests having voting power of each other Loan Party free and clear
of all Liens, except where such failure is as a result of a transaction
permitted by the Loan Documents.

“Claim” shall have the meaning provided in Section 10.04(c).

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

“Code” means the Internal Revenue Code of 1986, and the regulations promulgated
thereunder, as amended and in effect.

 

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“Collateral” means any and all “Collateral” as defined in any applicable
Security Document and all other property that is or is intended under the terms
of the Security Documents to be subject to Liens in favor of the Administrative
Agent.

“Collateral Access Agreement” means an agreement reasonably satisfactory in form
and substance to the Administrative Agent executed by (a) a bailee or other
Person in possession of Collateral, and (b) any landlord of Real Estate leased
by any Loan Party, pursuant to which such Person (i) acknowledges the
Administrative Agent’s Lien on the Collateral, (ii) releases such Person’s Liens
in the Collateral held by such Person or located on such Real Estate,
(iii) provides the Administrative Agent with access to the Collateral held by
such bailee or other Person or located in or on such Real Estate, (iv) as to any
landlord, provides the Administrative Agent with a reasonable time to sell and
dispose of the Collateral from such Real Estate, and (v) makes such other
agreements with the Administrative Agent as the Administrative Agent may
reasonably require.

“Commercial Letter of Credit” means any Letter of Credit issued for the purpose
of providing the primary payment mechanism in connection with the purchase of
any materials, goods or services by a Loan Party in the ordinary course of
business of such Loan Party.

“Commercial Letter of Credit Agreement” means the Commercial Letter of Credit
Agreement relating to the issuance of a Commercial Letter of Credit in the form
from time to time in use by the LC Issuer.

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

“Committed Borrowing” means a borrowing consisting of simultaneous Committed
Loans of the same Type and, in the case of LIBO Rate Loans, having the same
Interest Period made by each of the Lenders pursuant to Section 2.01.

“Committed Loan” shall have the meaning provided in Section 2.01.

“Committed Loan Notice” means a notice of (a) a Committed Borrowing, (b) a
conversion of Committed Loans from one Type to the other, or (c) a continuation
of LIBO Rate Loans, pursuant to 2.01(a), which, if in writing, shall be
substantially in the form of Exhibit A.

“Compliance Certificate” means a certificate substantially in the form of
Exhibit D.

“Concentration Account” shall have the meaning provided in Section 6.13(b).

“Consent” means actual consent given by a Lender from whom such consent is
sought; or the passage of seven (7) Business Days from receipt of written notice
to a Lender from the Administrative Agent of a proposed course of action to be
followed by the Administrative Agent without such Lender’s giving the
Administrative Agent written notice of that Lender’s objection to such course of
action.

“Consolidated” means, when used to modify a financial term, test, statement, or
report of a Person, the application or preparation of such term, test, statement
or report (as applicable) based upon the consolidation, in accordance with GAAP,
of the financial condition or operating results of such Person and its
Subsidiaries.

 

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“Consolidated EBITDA” means, at any date of determination, an amount equal to
Consolidated Net Income of the Lead Borrower and its Subsidiaries on a
Consolidated basis for the most recently completed Measurement Period, plus
(a) the following to the extent deducted in calculating such Consolidated Net
Income: (i) Consolidated Interest Charges, (ii) the provision for Federal,
state, local and foreign income Taxes, (iii) depreciation and amortization
expense and (iv) other non-recurring expenses reducing such Consolidated Net
Income which do not represent a cash item in such period or any future period
(in each case of or by the Lead Borrower and its Subsidiaries for such
Measurement Period), minus (b) the following to the extent included in
calculating such Consolidated Net Income: (i) Federal, state, local and foreign
income tax credits and (ii) all non-cash items increasing Consolidated Net
Income (in each case of or by the Lead Borrower and its Subsidiaries for such
Measurement Period), all as determined on a Consolidated basis in accordance
with GAAP.

“Consolidated Fixed Charge Coverage Ratio” means, at any date of determination,
the ratio of (a) (i) Consolidated EBITDA for such period, minus (ii) Capital
Expenditures made during such period, minus (iii) the aggregate amount of
Federal, state, local and foreign income taxes paid in cash during such period,
to (b) the sum of (i) Debt Service Charges, plus (ii) the aggregate amount of
all Restricted Payments, in each case, of or by the Lead Borrower and its
Subsidiaries for the most recently completed Measurement Period, all as
determined on a Consolidated basis in accordance with GAAP.

“Consolidated Interest Charges” means, for any Measurement Period, the sum of
(a) all interest, premium payments, debt discount, fees, charges and related
expenses in connection with borrowed money (including capitalized interest) or
in connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, including, without
limitation, all commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers’ acceptance financing and net costs
under Swap Contracts, but excluding any non-cash or deferred interest financing
costs, (b) all interest paid or payable with respect to discontinued operations
and (c) the portion of rent expense with respect to such period under Capital
Lease Obligations that is treated as interest in accordance with GAAP minus
(d) interest income during such period (excluding any portion of interest income
representing accruals of amounts received in a previous period), in each case of
or by the Lead Borrower and its Subsidiaries for the most recently completed
Measurement Period, all as determined on a Consolidated basis in accordance with
GAAP.

“Consolidated Net Income” means, as of any date of determination, the net income
of the Lead Borrower and its Subsidiaries for the most recently completed
Measurement Period, all as determined on a Consolidated basis in accordance with
GAAP, provided, however, that there shall be excluded (a) extraordinary gains
and extraordinary losses for such Measurement Period, (b) the income (or loss)
of such Person during such Measurement Period in which and to the extent any
other Person has a joint interest, except to the extent of the amount of cash
dividends or other distributions actually paid in cash to such Person during
such period, (c) the income (or loss) of such Person during such Measurement
Period and accrued prior to the date it becomes a Subsidiary of a Person or any
of such Person’s Subsidiaries or is merged into or consolidated with a Person or
any of its Subsidiaries or that Person’s assets are acquired by such Person or
any of its Subsidiaries, and (d) the income of any direct or indirect Subsidiary
of a Person to the extent that the declaration or payment of dividends or
similar distributions by that Subsidiary of that income is not at the time
permitted by operation of the terms of its Organization Documents or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary, except that the Lead Borrower’s equity
in any net loss of any such Subsidiary for such Measurement Period shall be
included in determining Consolidated Net Income.

 

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

“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
“Controlling” and “Controlled” have meanings correlative thereto.

“Cost” means the lower of cost or market value of Inventory, based upon the
Borrowers’ consistently applied accounting practices, known to the
Administrative Agent, which practices are in effect on the Closing Date as such
calculated cost is determined from invoices received by the Borrowers, the
Borrowers’ purchase journals or the Borrowers’ retail stock ledger. “Cost” does
not include inventory capitalization costs or other non purchase price charges
(such as freight) used in the Borrowers’ calculation of cost of goods sold.

“Covenant Compliance Event” means either (a) that an Event of Default has
occurred and is continuing, or (b) Excess Availability at any time is less than
the greater of (i) Ten Million Dollars ($10,000,000) or (ii) ten (10%) percent
of the Loan Cap. For purposes hereof, the occurrence of a Covenant Compliance
Event shall be deemed continuing at the Administrative Agent’s option (A) so
long as such Event of Default is continuing and has not been waived, and/or
(B) if the Covenant Compliance Event arises as a result of the Borrowers’
failure to achieve Excess Availability as required hereunder, until Excess
Availability has exceeded the greater of (i) Ten Million Dollars ($10,000,000)
or (ii) ten (10%) percent of the Loan Cap for sixty (60) consecutive Business
Days, in which case a Covenant Compliance Event shall no longer be deemed to be
continuing for purposes of this Agreement; provided that, a Covenant Compliance
Event shall be deemed continuing (even if an Event of Default is no longer
continuing and/or Excess Availability exceeds the required amount for sixty
(60) consecutive Business Days) at all times after a Covenant Compliance Event
has occurred and been discontinued on two (2) occasions after the Closing Date.
The termination of a Covenant Compliance Event as provided herein shall in no
way limit, waive or delay the occurrence of a subsequent Covenant Compliance
Event in the event that the conditions set forth in this definition again arise.

“Credit Card Agreements” means all agreements now or hereafter entered into by
any Borrower or for the benefit of any Borrower, in each case with any Credit
Card Issuer or any Credit Card Processor with respect to sales transactions
involving credit card or debit card purchases, including, but not limited to,
the agreements set forth on Schedule 5.21(b) hereto.

“Credit Card Issuer” means any person (other than a Loan Party) who issues or
whose members issue credit cards, including, without limitation, MasterCard or
VISA bank credit or debit cards or other bank credit or debit cards issued
through World Financial Network National Bank, MasterCard International, Inc.,
Visa, U.S.A., Inc. or Visa International and American Express, Discover, Diners
Club, Carte Blanche and other non-bank credit or debit cards, including, without
limitation, credit or debit cards issued by or through American Express Travel
Related Services Company, Inc., Novus Services, Inc., PayPal and other issuers
approved by the Administrative Agent.

“Credit Card Notifications” shall have the meaning provided in
Section 6.13(a)(ii).

“Credit Card Processor” means any servicing or processing agent or any factor or
financial intermediary who facilitates, services, processes or manages the
credit authorization, billing transfer and/or payment procedures with respect to
any Borrower’s sales transactions involving credit card or debit card purchases
by customers using credit cards or debit cards issued by any Credit Card Issuer.

 

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“Credit Card Receivables” means each “Account” (as defined in the UCC) together
with all income, payments and proceeds thereof, owed by a Credit Card Issuer or
Credit Card Processor to a Loan Party resulting from charges by a customer of a
Loan Party on credit or debit cards issued by such issuer in connection with the
sale of goods by a Loan Party, or services performed by a Loan Party, in each
case in the ordinary course of its business.

“Credit Extensions” mean each of the following: (a) a Borrowing and (b) an LC
Credit Extension.

“Credit Party” or “Credit Parties” means (a) individually, (i) each Lender and
its Affiliates, (ii) the Administrative Agent, (iii) each LC Issuer, (iv) the
Arranger, (v) each beneficiary of each indemnification obligation undertaken by
any Loan Party under any Loan Document, (vi) any other Person to whom
Obligations under this Agreement and other Loan Documents are owing, and
(vii) the successors and assigns of each of the foregoing, and (b) collectively,
all of the foregoing.

“Credit Party Expenses” means, without limitation, (a) all reasonable
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates,
in connection with this Agreement and the other Loan Documents, including
without limitation, (i) the reasonable fees, charges and disbursements
(A) counsel for the Administrative Agent, (B) of outside consultants for the
Administrative Agent, (C) of appraisers, (D) incurred during any field
examinations, and (E) all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of the Obligations, (ii) such
out-of-pocket expenses incurred in connection with (A) the syndication of the
credit facilities provided for herein, (B) the preparation, negotiation,
administration, management, execution and delivery of this Agreement and the
other Loan Documents or any amendments, modifications or waivers of the
provisions thereof (whether or not the transactions contemplated hereby or
thereby shall be consummated), (C) the enforcement or protection of their rights
in connection with this Agreement or the Loan Documents or efforts to preserve,
protect, collect, or enforce the Collateral, or (D) any workout, restructuring
or negotiations in respect of any Obligations, (b) with respect to the LC
Issuer, and its Affiliates, all reasonable out-of-pocket expenses incurred in
connection with the issuance, amendment, renewal or extension of any Letter of
Credit or any demand for payment thereunder; and (c) all reasonable
out-of-pocket expenses incurred by the Credit Parties who are not the
Administrative Agent, the LC Issuer or any Affiliate of any of them, after the
occurrence and during the continuance of an Event of Default, provided that such
Credit Parties shall be entitled to reimbursement for no more than one counsel
representing all such Credit Parties (absent a conflict of interest in which
case the Credit Parties may engage and be reimbursed for additional counsel).

“Customer Credit Liabilities” means at any time, the aggregate remaining value
at such time of (a) outstanding gift certificates and gift cards of the
Borrowers entitling the holder thereof to use all or a portion of the
certificate or gift card to pay all or a portion of the purchase price for any
Inventory, (b) outstanding merchandise credits of the Borrowers, (c) layaway
obligations of the Borrowers, and (d) liabilities in connection with frequent
shopping programs of the Borrowers.

“Customer Deposits” means deposits made by customers with respect to the
purchase of goods or the performance of services.

“DDA” means each checking, savings or other demand deposit account maintained by
any of the Loan Parties. All funds in each DDA shall be conclusively presumed to
be Collateral and proceeds of Collateral and the Administrative Agent and the
Lenders shall have no duty to inquire as to the source of the amounts on deposit
in any DDA.

“DDA Notification” shall have the meaning provided in Section 6.13(a)(i).

 

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“Debt Service Charges” means for any Measurement Period, the sum of
(a) Consolidated Interest Charges required to be paid for such Measurement
Period, plus (b) regularly scheduled principal payments required to be made on
account of Indebtedness (excluding the Obligations and any Synthetic Lease
Obligations and Capital Lease Obligations) for such Measurement Period, in each
case determined on a Consolidated basis in accordance with GAAP.

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

“Default” means any event or condition that constitutes an Event of Default or
that, with the giving of any notice, the passage of time, or both, would be an
Event of Default.

“Default Rate” means (a) when used with respect to Obligations other than Letter
of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the
Applicable Margin, if any, applicable to Base Rate Loans, plus (iii) two percent
(2%) per annum; provided, that, with respect to a LIBO Rate Loan, the Default
Rate shall be an interest rate equal to the interest rate (including any
Applicable Margin) otherwise applicable to such Loan plus two percent (2%) per
annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to
the Applicable LC Fee Rate for Standby Letters of Credit and Commercial Letters
of Credit, as applicable, plus two percent (2%) per annum.

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

“Deferred Compensation Plan” means the Stein Mart Executive Deferred
Compensation Plan, as amended, modified, supplemented, restated or replaced from
time to time.

“Deteriorating Lender” means any Defaulting Lender or any Lender as to which
(a) the LC Issuer or the Swing Line Lender has a good faith belief that such
Lender has defaulted in fulfilling its obligations under one or more other
syndicated credit facilities, or (b) a Person that Controls such Lender has been
deemed insolvent or become the subject of a bankruptcy, insolvency or similar
proceeding.

“Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction and any sale,
transfer, license or other disposition of (whether in one transaction or in a
series of transactions) of any property (including, without limitation, any
Equity Interests) by any Person (or the granting of any option or other right to
do any of the foregoing), including any sale, assignment, transfer or other
disposal, with or without recourse, of any notes or accounts receivable or any
rights and claims associated therewith.

“Disqualified Stock” means any Equity Interest that, by its terms (or by the
terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is ninety-one
(91) days after the date on which the Loans mature; provided, that, (i) only the
portion of such Equity Interests which so matures or is mandatorily redeemable,
is so convertible or exchangeable or is so redeemable at the option of the
holder thereof prior to such date shall be deemed

 

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to be Disqualified Stock and (ii) with respect to any Equity Interests issued to
any employee or to any plan for the benefit of employees of the Lead Borrower or
its Subsidiaries or by any such plan to such employees, such Equity Interest
shall not constitute Disqualified Stock solely because it may be required to be
repurchased by the Lead Borrower or one of its Subsidiaries in order to satisfy
applicable statutory or regulatory obligations or as a result of such employee’s
termination, resignation, death or disability and if any class of Equity
Interest of such Person that by its terms authorizes such Person to satisfy its
obligations thereunder by delivery of an Equity Interest that is not
Disqualified Stock, such Equity Interests shall not be deemed to be Disqualified
Stock. Notwithstanding the preceding sentence, any Equity Interest that would
constitute Disqualified Stock solely because the holders thereof have the right
to require a Loan Party to repurchase such Equity Interest upon the occurrence
of a change of control or an asset sale shall not constitute Disqualified Stock.
The amount of Disqualified Stock deemed to be outstanding at any time for
purposes of this Agreement will be the maximum amount that the Lead Borrower and
its Subsidiaries may become obligated to pay upon maturity of, or pursuant to
any mandatory redemption provisions of, such Disqualified Stock or portion
thereof, plus accrued dividends.

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

“Eligible Assignee” means (a) a Credit Party or any of its Affiliates; (b) a
bank, insurance company, or company engaged in the business of making commercial
loans, which Person, together with its Affiliates, has a combined capital and
surplus in excess of $250,000,000; (c) an Approved Fund; (d) any Person to whom
a Credit Party assigns its rights and obligations under this Agreement as part
of an assignment and transfer of such Credit Party’s rights in and to a material
portion of such Credit Party’s portfolio of asset based credit facilities, and
(e) any other Person (other than a natural person) approved by (i) the
Administrative Agent, the LC Issuer and the Swing Line Lender, and (ii) unless
an Event of Default has occurred and is continuing, the Lead Borrower (each such
approval not to be unreasonably withheld or delayed); provided that
notwithstanding the foregoing, “Eligible Assignee” shall not include a Loan
Party or any of the Loan Parties’ Affiliates or Subsidiaries nor shall it
include any Person that is not a financial institution licensed to conduct a
general banking or commercial lending business under the laws of the United
States or any state within the United States.

“Eligible Credit Card Receivables” means at the time of any determination
thereof, each Credit Card Receivable that at all times satisfies the criteria
set forth below as determined by the Administrative Agent in its Permitted
Discretion and which has been earned by performance and represents the bona fide
amounts due to a Borrower from a Credit Card Processor and/or Credit Card
Issuer, and in each case originated in the ordinary course of business of such
Borrower. Without limiting the foregoing, in order to be an Eligible Credit Card
Receivable, an Account shall indicate no Person other than a Borrower as payee
or remittance party. In determining the amount to be so included, the face
amount of an Account shall be reduced by, without duplication, to the extent not
reflected in such face amount, (i) the amount of all accrued and actual
discounts, claims, credits or credits pending, promotional program allowances,
price adjustments, finance charges or other allowances (including any amount
that a Borrower may be obligated to rebate to a customer, a credit card payment
processor, or Credit Card Issuer pursuant to the terms of any agreement or
understanding (written or oral)) and (ii) the aggregate amount of all cash
received in respect of such Account but not yet applied by the Loan Parties to
reduce the amount of such Credit Card Receivable. Except as otherwise determined
by the Administrative Agent in its Permitted Discretion, Eligible Credit Card
Receivables shall not include any Credit Card Receivable:

(a) which is unpaid more than five (5) Business Days after the date of
determination of eligibility thereof;

(b) where such Credit Card Receivable or the underlying contract contravenes any
laws, rules or regulations applicable thereto, including, rules and regulations
relating to truth-in-lending, fair credit billing, fair credit reporting, equal
credit opportunity, fair debt collection practices and privacy or any party to
the underlying contract is in violation of any such laws, rules or regulations;

 

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(c) which is not a valid, legally enforceable obligation of the applicable
issuer with respect thereto;

(d) to the extent to which it is subject to any present, or contingent (or any
facts (i) exist to the knowledge of Agent or any Loan Party, or (ii) have been
disclosed in the course of any field examination or otherwise, which are the
basis for any future) claim, chargeback, offset, deduction or counterclaim,
dispute or other defense on the part of an Account Debtor;

(e) that is not subject to a perfected first priority Lien in favor of the
Administrative Agent, or with respect to which a Borrower does not have good,
valid and marketable title thereto, free and clear of any Lien (other than Liens
granted to the Administrative Agent pursuant to the Security Documents and Liens
permitted under clause (a) of the definition of Permitted Encumbrances, provided
that a Reserve has been established with respect thereto);

(f) which does not conform to all representations, warranties or other
provisions in the Loan Documents relating to Credit Card Receivables;

(g) which does not constitute an “Account” (as defined in the UCC);

(h) where the Credit Card Processor has the right under certain circumstances to
require a Loan Party to repurchase the Accounts from such Credit Card Processor;

(i) is due from a Credit Card Issuer or Credit Card Processor of the applicable
credit card which is the subject of any bankruptcy or insolvency proceedings;

(j) which is evidenced by “chattel paper” or an “instrument” of any kind unless
such “chattel paper” or “instrument” is in the possession of the Administrative
Agent, and to the extent necessary or appropriate, endorsed to the
Administrative Agent; or

(k) which the Administrative Agent determines in its Permitted Discretion to be
uncertain of collection or which do not meet such other reasonable eligibility
criteria for Credit Card Receivables as the Administrative Agent may determine
in its Permitted Discretion.

“Eligible Inventory” means, as of the date of determination thereof, without
duplication, items of Inventory of a Borrower that are finished goods,
merchantable and readily saleable to the public in the ordinary course of the
Borrowers’ business deemed by the Administrative Agent in its Permitted
Discretion to be eligible for inclusion in the calculation of the Borrowing
Base, in each case that, except as otherwise agreed by the Administrative Agent,
(i) complies with each of the representations and warranties respecting
Inventory made by the Borrowers in the Loan Documents, and (i) is not excluded
as ineligible by virtue of one or more of the criteria set forth below. Except
as otherwise agreed by the Administrative Agent, in its Permitted Discretion,
the following items of Inventory shall not be included in Eligible Inventory:

(a) Inventory that is not solely owned by a Borrower or a Borrower does not have
good and valid title thereto;

(b) Inventory that is leased by or is on consignment to a Borrower or which is
consigned by a Borrower to a Person which is not a Loan Party;

 

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(c) Inventory that is not located in the United States of America (excluding
territories or possessions of the United States) at a location that is owned or
leased by a Borrower, except (i) Inventory in transit between such owned or
leased locations, or (ii) to the extent that the Borrowers have furnished the
Administrative Agent with (A) any UCC financing statements or other documents
that the Administrative Agent may determine to be necessary to perfect its
security interest in such Inventory at such location, and (B) a Collateral
Access Agreement executed by the Person owning any such location on terms
reasonably acceptable to the Administrative Agent;

(d) Inventory that is located in a distribution center leased by a Loan Party or
leased by a distribution center operator under an agreement with a Loan Party)
unless (i) the applicable lessor or and (if applicable) the distribution center
operator has delivered to the Administrative Agent a Collateral Access Agreement
or (ii) a Reserve based on rent with respect to such location has been
established by the Administrative Agent in its Permitted Discretion;

(e) Inventory that is comprised of goods which (i) are damaged, defective,
“seconds,” or otherwise unmerchantable, (ii) are to be returned to the vendor,
(iii) are obsolete, or custom items, work in process, raw materials, or that
constitute spare parts, promotional, marketing, packaging and shipping materials
or supplies used or consumed in a Borrower’s business, (iv) are seasonal in
nature and which have been packed away for sale in the subsequent season,
(v) not in compliance with all standards imposed by any Governmental Authority
having regulatory authority over such Inventory, its use or sale, or (vi) are
bill and hold goods;

(f) Inventory which does not conform to all representations, warranties or other
provisions in the Loan Documents relating to Inventory;

(g) Inventory that is not subject to a perfected first priority security
interest in favor of the Administrative Agent or that is subject to any other
Lien (except Permitted Encumbrances described in clauses (a), (b) and (j);

(h) Inventory that consists of samples, labels, bags, packaging, and other
similar non-merchandise categories;

(i) Inventory that is not insured in compliance with the provisions of
Section 5.10 hereof;

(j) Inventory that has been sold but not yet delivered or as to which a Borrower
has accepted a deposit;

(k) Inventory that is subject to any licensing, patent, royalty, trademark,
trade name or copyright agreement with any third party from which any Borrower
or any of its Subsidiaries has received notice of a dispute in respect of any
such agreement, in any such case, involving an amount in excess of $100,000 in
the aggregate in any Fiscal Year; or

(l) Inventory acquired in a Permitted Acquisition or which is not of the type
usually sold in the ordinary course of the Borrowers’ business, unless and until
the Administrative Agent has completed or received (A) an appraisal of such
Inventory from appraisers reasonably satisfactory to the Administrative Agent
and establishes Inventory advance rate and Inventory Reserves (if applicable)
therefor, and otherwise agrees that such Inventory shall be deemed Eligible
Inventory, and (B) such other due diligence as the Administrative Agent may
reasonably require, all of the results of the foregoing to be reasonably
satisfactory to the Administrative Agent.

 

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

“Environmental Liability” means any liability, obligation, damage, loss, claim,
action, suit, judgment, order, fine, penalty, fee, expense, or cost, contingent
or otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of any Borrower, any other Loan
Party or any of their respective Subsidiaries directly or indirectly resulting
from or based upon (a) violation of any Environmental Law, (b) the generation,
use, handling, transportation, storage, treatment or disposal or presence of any
Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or
threatened release of any Hazardous Materials into the environment in violation
of any Environmental Law or (e) any contract, agreement or other consensual
arrangement pursuant to which liability is assumed or imposed with respect to
any of the foregoing.

“Equipment” shall have the meaning set forth in the UCC.

“Equity Interests” means, with respect to any Person, all of the shares of
capital stock of (or other ownership or profit interests in) such Person, all of
the warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other ownership or profit interests in)
such Person, all of the securities convertible into or exchangeable for shares
of capital stock of (or other ownership or profit interests in) such Person or
warrants, rights or options for the purchase or acquisition from such Person of
such shares (or such other interests), and all of the other ownership or profit
interests in such Person (including 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.

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

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

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

“Event of Default” shall have the meaning provided in Section 8.01. An Event of
Default shall be deemed to be continuing unless and until that Event of Default
has been duly waived as provided in Section 10.03 hereof or is cured in
accordance with the terms of the applicable Loan Document or otherwise cured in
a manner reasonably satisfactory to the Administrative Agent in its Permitted
Discretion, if such Event of Default is capable of being cured as determined by
the Administrative Agent.

 

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“Excess Availability” means, as of any date of determination thereof by the
Administrative Agent, the result, if a positive number, of: (a) the Loan Cap,
minus, without duplication, (b) the sum of (i) the aggregate unpaid balance of
Credit Extensions, plus (ii) past due payables that are past due by more than
sixty (60) days (other than payables being contested or disputed by a Borrower
in good faith). For purposes of determining the outstanding trade payables in
the ordinary course, Lead Borrower shall provide to the Administrative Agent the
summary reports of payables with each Borrowing Base Certificate, together with
such other information with respect thereto as Agent may from time to time
reasonably request.

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender,
the LC Issuer or any other recipient of any payment to be made by or on account
of any obligation of the Loan Parties hereunder, (a) taxes imposed on or
measured by its overall net income (however denominated), and franchise taxes
imposed on it (in lieu of net income taxes), by the jurisdiction (or any
political subdivision thereof) under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable Lending Office is located, (b) any branch
profits taxes imposed by the United States or any similar tax imposed by any
other jurisdiction in which any Loan Party is located and (c) in the case of a
Foreign Lender (other than an assignee pursuant to a request by the Lead
Borrower under Section 10.13), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
hereto (or designates a new Lending Office) or is attributable to such Foreign
Lender’s failure or inability (other than as a result of a Change in Law) to
comply with Section 3.01(e), except to the extent that such Foreign Lender (or
its assignor, if any) was entitled, at the time of designation of a new Lending
Office (or assignment), to receive additional amounts from the Loan Parties with
respect to such withholding tax pursuant to Section 3.01(a).

“Executive Order” shall have the meaning provided in Section 10.18.

“Existing Credit Agreement” means that certain the Loan and Security Agreement,
dated as of July 18, 2003, by and among Borrowers, Wells Fargo (successor by
merger to Wachovia Bank, National Association, successor by merger to Congress
Financial Corporation (Florida)), as agent, and a syndicate of lenders, as
amended.

“Existing Letters of Credit” means, collectively, the letters of credit issued
for the account of a Borrower pursuant to the Existing Credit Agreement listed
on Schedule 1.01(a) hereto, all of which shall be deemed and shall constitute
Letters of Credit issued hereunder for all purposes of this Agreement, as the
same now exist or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced.

“Existing Obligations” shall have the meaning provided in Section 10.25.

“Extraordinary Receipt” means any cash received by or paid to or for the account
of any Person not in the ordinary course of business, including tax refunds,
pension plan reversions, proceeds of insurance (other than proceeds of business
interruption insurance to the extent such proceeds constitute compensation for
lost earnings), condemnation awards (and payments in lieu thereof), indemnity
payments and any purchase price adjustments.

“Facility Guaranty” means the Guaranty made by any Guarantors in favor of the
Administrative Agent and the other Credit Parties, in form reasonably
satisfactory to the Administrative Agent.

 

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“Factored Receivables” means any Accounts of a Loan Party which have been
factored or sold by an account debtor of a Loan Party to Wells Fargo or any of
its Affiliates pursuant to a factoring arrangement or otherwise.

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

“Fee Letter” means any letter agreement that is entered into as of the Increase
Effective Date, among the Borrowers and the Administrative Agent, providing for
fees then agreed to with respect to any increase in Commitments pursuant to
Section 2.15.

“Fiscal Month” means any fiscal month of any Fiscal Year in accordance with the
fiscal accounting calendar of the Lead Borrower.

“Fiscal Quarter” means any fiscal quarter of any Fiscal Year in accordance with
the fiscal accounting calendar of the Lead Borrower.

“Fiscal Year” means any period of twelve consecutive months ending on the
Saturday closest to the last day in January of any calendar year.

“Foreign Asset Control Regulations” shall have the meaning provided
Section 10.18.

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

“Fronting Fee” has the meaning assigned to such term in Section 2.03(j).

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

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

“GAAP” means generally accepted accounting principles in the United States set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.

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

 

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“Governmental Litigation” shall have the meaning provided in Section 6.03(b).

“Guarantee” means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the “primary obligor”) in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect,
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien). The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the related primary obligation, or portion thereof, in respect of
which such Guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith. The term “Guarantee” as a verb has a
corresponding meaning.

“Guarantor” means each Subsidiary of the Borrowers (other than any CFC) that
shall be required to execute and deliver a Facility Guaranty pursuant to
Section 6.12.

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

“Honor Date” shall have the meaning provided in Section 2.03(c)(i).

“Increase Effective Date” shall have the meaning provided in Section 2.15(d).

“Indebtedness” means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:

(a) all obligations of such Person for borrowed money and all obligations of
such Person evidenced by bonds, debentures, notes, loan agreements or other
similar instruments;

(b) the maximum amount of all direct or contingent obligations of such Person
arising under letters of credit (including standby and commercial), bankers’
acceptances, bank guaranties, surety bonds and similar instruments;

(c) net obligations of such Person under any Swap Contract;

 

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(d) all obligations of such Person to pay the deferred purchase price of
property or services (other than trade accounts payable in the ordinary course
of business and, in each case, not past due for more than ninety (90) days after
the date on which such trade account payable was created);

(e) indebtedness (excluding prepaid interest thereon) secured by a Lien on
property owned or being purchased by such Person (including indebtedness arising
under conditional sales or other title retention agreements), whether or not
such indebtedness shall have been assumed by such Person or is limited in
recourse;

(f) all Attributable Indebtedness of such Person;

(g) all obligations of such Person to purchase, redeem, retire, defease or
otherwise make any payment in respect of any Equity Interest in such Person or
any other Person (including, without limitation, Disqualified Stock, or any
warrant, right or option to acquire such Equity Interest, valued, in the case of
a redeemable preferred interest, at the greater of its voluntary or involuntary
liquidation preference plus accrued and unpaid dividends; and

(h) all Guarantees of such Person in respect of any of the foregoing.

For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer in the nature of a general partner,
unless such Indebtedness is non-recourse to such Person. The amount of any net
obligation under any Swap Contract on any date shall be deemed to be the Swap
Termination Value thereof as of such date.

“Indemnified Party” shall have the meaning provided in Section10.04(c).

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Indemnifying Party” shall have the meaning provided in Section 10.04(c).

“Indemnitees” shall have the meaning provided in Section 10.04(b).

“Information” shall have the meaning provided in Section 10.07.

“Intellectual Property” means all present and future: (a) trade secrets,
know-how and other proprietary information; (b) trademarks, trademark
applications, internet domain names, service marks, trade dress, trade names,
business names, designs, logos, slogans (and all translations, adaptations,
derivations and combinations of the foregoing) indicia and other source and/or
business identifiers, and all registrations or applications for registrations
which have heretofore been or may hereafter be issued thereon throughout the
world; (c) copyrights and copyright applications (including copyrights for
computer programs) and all tangible and intangible property embodying the
copyrights, unpatented inventions (whether or not patentable); (d) patents and
patent applications; (e) industrial design applications and registered
industrial designs; (f) license agreements related to any of the foregoing and
income therefrom; (g) books, records, writings, computer tapes or disks, flow
diagrams, specification sheets, computer software, source codes, object codes,
executable code, data, databases and other physical manifestations, embodiments
or incorporations of any of the foregoing; (h) all other intellectual property;
and all common law and other rights throughout the world in and to all of the
foregoing.

“Interest Payment Date” means, (a) as to any Loan other than a Base Rate Loan,
the last day of each Interest Period applicable to such Loan and the Maturity
Date; provided, however, that if any

 

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Interest Period for a LIBO Rate Loan exceeds three (3) months, the respective
dates that fall every three months after the beginning of such Interest Period
shall also be Interest Payment Dates, (b) as to any Base Rate Loan (including a
Swing Line Loan), (i) so long as no Cash Dominion Event has occurred and is
continuing, the first day after the end of each calendar quarter, and (ii) upon
the occurrence and during the continuance of a Cash Dominion Event, the first
day after the end of each calendar month, and (c) the Maturity Date.

“Interest Period” means, as to each LIBO Rate Loan, the period commencing on the
date such LIBO Rate Loan is disbursed or converted to or continued as a LIBO
Rate Loan and ending on the date one, two, or three months thereafter, as
selected by the Lead Borrower in its Committed Loan Notice; provided that:

(a) any Interest Period that would otherwise end on a day that is not a Business
Day shall be extended to the next succeeding Business Day unless such Business
Day falls in another calendar month, in which case such Interest Period shall
end on the next preceding Business Day;

(b) any Interest Period that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last Business Day of
the calendar month at the end of such Interest Period;

(c) no Interest Period shall extend beyond the Maturity Date; and

(d) notwithstanding the provisions of clause (c) no Interest Period shall have a
duration of less than one (1) month, and if any Interest Period applicable to a
LIBO Borrowing would be for a shorter period, such Interest Period shall not be
available hereunder.

For purposes hereof, the date of a Borrowing initially shall be the date on
which such Borrowing is made and thereafter shall be the effective date of the
most recent conversion or continuation of such Borrowing.

“Internal Control Event” means an uncorrected material weakness in, or a fraud
which pertains to and that involves management or other employees who have a
significant role in, the Lead Borrower’s and/or its Subsidiaries’ internal
controls over financial reporting, in each case as described in the Securities
Laws.

“Inventory” has the meaning given that term in the UCC, and shall also include,
without limitation, all: (a) goods which (i) are leased by a Person as lessor,
(ii) are held by a Person for sale or lease or to be furnished under a contract
of service, (iii) are furnished by a Person under a contract of service, or
(iv) consist of raw materials, work in process, or materials used or consumed in
a business; (b) goods of said description in transit; (c) goods of said
description which are returned, repossessed or rejected; and (d) packaging,
advertising, and shipping materials related to any of the foregoing.

“Inventory Reserves” means such reserves as may be established from time to time
by the Administrative Agent in the Administrative Agent’s Permitted Discretion
with respect to the determination of the saleability, at retail, of the Eligible
Inventory or which reflect such other factors as affect the market value of the
Eligible Inventory. Without limiting the generality of the foregoing, Inventory
Reserves may, in the Administrative Agent’s Permitted Discretion, include (but
are not limited to) reserves based on: (a) obsolescence; (b) seasonality;
(c) Shrink; (d) imbalance; (e) change in Inventory character; (f) change in
Inventory composition; (g) change in Inventory mix; (h) markdowns (both
permanent and point of sale); (i) retail markons and markups inconsistent with
prior period practice and performance, industry standards, current business
plans or advertising calendar and planned advertising events; (j) out-of-date
and/or expired Inventory; and (k) slow moving Inventory.

 

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“Investment” means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of Equity Interests of another Person, (b) a loan, advance or
capital contribution to, Guarantee or assumption of debt of, or purchase or
other acquisition of any other debt or interest in, another Person, or (c) any
Acquisition, or (d) any other investment of money or capital in order to obtain
a profitable return. For purposes of covenant compliance, the amount of any
Investment shall be the amount actually invested, without adjustment for
subsequent increases or decreases in the value of such Investment. For avoidance
of doubt, “Investment” does not include capital improvements to existing assets
or the purchase of real or personal property to be used in the ordinary course
of business.

“IP Lien” has the meaning given that term in clause (q) of the definition of
Permitted Encumbrances.

“IRS” means the United States Internal Revenue Service.

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

“Issuer Documents” means with respect to any Letter of Credit, the Letter Credit
Application, the Standby Letter of Credit Agreement or Commercial Letter of
Credit Agreement, applicable, and any other document, agreement and instrument
entered into by the LC Issuer and the Borrower (or any Subsidiary) or in favor
of the LC Issuer and relating to any such Letter of Credit.

“Joinder Agreement” means an agreement, in form satisfactory to the
Administrative Agent pursuant to which, among other things, a Person becomes a
party to, and bound by the terms of, this Agreement and/or the other Loan
Documents in the same capacity and to the same extent as either a Borrower or a
Guarantor, as the Administrative Agent may determine.

“Laws” means each international, foreign, Federal, state and local statute,
treaty, rule, guideline, regulation, ordinance, code and administrative or
judicial precedent or authority, including the interpretation or administration
thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and each applicable administrative
order, directed duty, request, license, authorization and permit of, and
agreement with, any Governmental Authority, in each case whether or not having
the force of law.

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

“LC Issuer” means (a) Wells Fargo in its capacity as issuer of Letters of Credit
hereunder, or any successor issuer of Letters of Credit hereunder (which
successor may only be a Lender selected by the Administrative Agent in its
discretion), and (b) with respect to the Existing Letters of Credit and until
such Existing Letters of Credit expire or are returned undrawn, Wells Fargo in
its capacity as issuer of the Existing Letters of Credit under the Existing
Credit Agreement. The LC Issuer may, in its discretion, arrange for one or more
Letters of Credit to be issued by Affiliates of the LC Issuer and/or for such
Affiliate to act as an advising, transferring, confirming and/or nominated bank
in connection with the issuance or administration of any such Letter of Credit,
in which case the term “LC Issuer” shall include any such Affiliate with respect
to Letters of Credit issued by such Affiliate.

 

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“LC Obligations” means, as at any date of determination, the aggregate undrawn
amount available to be drawn under all outstanding Letters of Credit. For
purposes of computing the amounts available to be drawn under any Letter of
Credit, the amount of such Letter of Credit shall be determined in accordance
with Section 1.06. For all purposes of this Agreement, if on any date of
determination a Letter of Credit has expired by its terms but any amount may
still be drawn thereunder by reason of the operation of any Rule under the ISP
or any article of UCP 600, such Letter of Credit shall be deemed to be
“outstanding” in the amount so remaining available to be drawn.

“Lead Borrower” shall have the meaning provided in the introductory paragraph
hereto.

“Lease” means any agreement, whether written or oral, no matter how styled or
structured, pursuant to which a Loan Party is entitled to the use or occupancy
of any space in a structure, land, improvements or premises for any period of
time.

“Lender” shall have the meaning provided in the introductory paragraph hereto
and, as the context requires, includes the Swing Line Lender.

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

“Letter of Credit” means (a) each Standby Letter of Credit, and (b) each
Commercial Letter of Credit and shall include the Existing Letters of Credit.

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

“Letter of Credit Expiration Date” means the day that is seven (7) days prior to
the Maturity Date then in effect (or, if such day is not a Business Day, the
next preceding Business Day).

“Letter of Credit Fee” shall have the meaning provided in Section 2.03(i).

“Letter of Credit Sublimit” means an amount equal to $25,000,000. The Letter of
Credit Sublimit is part of, and not in addition to, the Aggregate Commitments. A
permanent reduction of the Aggregate Commitments shall not require a
corresponding pro rata reduction in the Letter of Credit Sublimit; provided,
however, that if the Aggregate Commitments are reduced to an amount less than
the Letter of Credit Sublimit, then the Letter of Credit Sublimit shall be
reduced to an amount equal to (or, at Lead Borrower’s option, less than) the
Aggregate Commitments.

“LIBO Borrowing” means a Borrowing comprised of LIBO Rate Loans.

“LIBO Rate” means for any Interest Period with respect to a LIBO Rate Loan, the
rate per annum equal to the British Bankers Association LIBOR Rate (“BBA
LIBOR”), as published by Reuters (or other commercially available source
providing quotations of BBA LIBOR as designated by the Administrative Agent from
time to time) at approximately 11:00 a.m., London time, two Business Days prior
to the commencement of such Interest Period, for Dollar deposits (for delivery
on the first day of such Interest Period) with a term equivalent to such
Interest Period. If such rate is not available at such time for any reason, then
the “LIBO Rate” for such Interest Period shall be the rate per annum determined
by the Administrative Agent to be the rate at which deposits in Dollars for
delivery on the first day of such Interest Period in same day funds in the
approximate amount of the LIBO Rate Loan being made, continued or converted by
Wells Fargo and with a term equivalent to such Interest Period would be

 

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offered to Wells Fargo by major banks in the London interbank eurodollar market
in which Wells Fargo participates at their request at approximately 11:00 a.m.
(London time) two Business Days prior to the commencement of such Interest
Period.

“LIBO Rate Loan” means a Committed Loan that bears interest at a rate based on
the Adjusted LIBO Rate.

“Lien” means (a) any mortgage, deed of trust, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge, or
preference, priority or other security interest or preferential arrangement in
the nature of a security interest of any kind or nature whatsoever (including
any conditional sale, Capital Lease Obligation, Synthetic Lease Obligation, or
other title retention agreement, any easement, right of way or other encumbrance
on title to real property, and any financing lease having substantially the same
economic effect as any of the foregoing) and (b) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.

“Liquidation” means the exercise by the Administrative Agent of those rights and
remedies accorded to the Administrative Agent under the Loan Documents and
applicable Law as a creditor of the Loan Parties with respect to the realization
on the Collateral, including (after the occurrence and during the continuation
of an Event of Default) the conduct by the Loan Parties acting with the consent
of the Administrative Agent, of any public, private or “going out of business”,
“store closing”, or other similarly themed sale or other disposition of the
Collateral for the purpose of liquidating the Collateral. Derivations of the
word “Liquidation” (such as “Liquidate”) are used with like meaning in this
Agreement.

“Loan” means an extension of credit by or on behalf of a Lender to a Borrower
under Article II in the form of a Committed Loan or a Swing Line Loan.

“Loan Account” shall have the meaning provided in Section 2.11(a).

“Loan Cap” means, at any time of determination, the lesser of (a) the Aggregate
Commitments or (b) the Borrowing Base.

“Loan Documents” means this Agreement, each Note, each Issuer Document, the Cash
Management Letter, the Fee Letter, all Borrowing Base Certificates, the Blocked
Account Agreements, the DDA Notifications, the Credit Card Notifications, the
Security Documents, the Facility Guaranty, and any other instrument or agreement
now or hereafter executed and delivered in connection herewith, or in connection
with any transaction arising out of any Cash Management Services and Bank
Products provided by the Administrative Agent or any of its Affiliates, each as
amended and in effect from time to time.

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

“Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, liabilities (actual
or contingent), or financial condition of Loan Parties and their Subsidiaries
taken as a whole; (b) a material impairment of the ability of any Loan Party to
perform its obligations under any Loan Document to which it is a party; or (c) a
material impairment of the rights and remedies of the Agent or the Lenders under
any Loan Document or a material adverse effect upon the legality, validity,
binding effect or enforceability against any Loan Party of any Loan Document to
which it is a party; or (d) a material adverse change in the Collateral or its
value. In determining whether any individual event would result in a Material
Adverse Effect, notwithstanding that such event in and of itself does not have
such effect, a Material Adverse Effect shall be deemed to have occurred if the
cumulative effect of such event and all other then existing events would result
in a Material Adverse Effect.

 

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“Material Contract” means, with respect to any Person, (a) each contract to
which such Person is a party involving aggregate consideration payable to or by
such Person of $5,000,000 or more in any Fiscal Year, and (b) any other contract
or other agreement (other than the Loan Documents), whether written or oral, to
which any Borrower is a party as to which the breach, nonperformance,
cancellation or failure to renew by any party thereto would have a Material
Adverse Effect.

“Material Indebtedness” means Indebtedness (other than the Obligations) of the
Loan Parties in an aggregate principal amount exceeding $5,000,000. For purposes
of determining the amount of Material Indebtedness at any time, (a) the amount
of the obligations in respect of any Swap Contract at such time shall be
calculated at the Swap Termination Value thereof, (b) undrawn committed or
available amounts shall be included, and (c) all amounts owing to all creditors
under any combined or syndicated credit arrangement shall be included.

“Maturity Date” means February 28, 2017.

“Maximum Rate” shall have the meaning provided in Section 10.09.

“Measurement Period” means, at any date of determination, the most recently
completed twelve (12) Fiscal Months of the Lead Borrower.

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

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

“Net Proceeds” means:

(a) with respect to any Disposition by any Loan Party or any of its
Subsidiaries, or any Extraordinary Receipt received or paid to the account of
any Loan Party or any of its Subsidiaries, the excess, if any, of (i) the sum of
cash and cash equivalents received in connection with such transaction
(including any cash or cash equivalents received by way of deferred payment
pursuant to, or by monetization of, a note receivable or otherwise, but only as
and when so received) over (ii) the sum of (A) the principal amount of any
Indebtedness that is secured by the applicable asset by a Lien permitted
hereunder which is senior to the Administrative Agent’s Lien on such asset and
that is required to be repaid (or to establish an escrow for the future
repayment thereof) in connection with such transaction (other than Indebtedness
under the Loan Documents), and (B) the reasonable and customary out-of-pocket
expenses incurred by such Loan Party or such Subsidiary in connection with such
transaction (including, without limitation, appraisals, and brokerage, legal,
title and recording or transfer tax expenses and commissions) paid by any Loan
Party to third parties (other than Affiliates); and

(b) with respect to the sale or issuance of any Equity Interest by any Loan
Party or any of its Subsidiaries, or the incurrence or issuance of any
Indebtedness by any Loan Party or any of its Subsidiaries, (i) fifty percent
(50%) of the excess, in the case of any such sale or issuance of any Equity
Interest, and (ii) one hundred percent (100%) of the excess, in the case of any
such incurrence or issuance of any Indebtedness, of (A) the sum of the cash and
cash equivalents received in connection with such transaction over (B) the
underwriting discounts and commissions, and other reasonable and customary
out-of-pocket expenses, incurred by such Loan Party or such Subsidiary in
connection therewith.

 

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“Net Recovery Percentage” means the fraction, expressed as a percentage (a) the
numerator of which is the amount equal to the recovery on the aggregate amount
of the applicable category of Eligible Inventory at such time on a “going out of
business sale” basis as set forth in the most recent acceptable inventory
appraisal received by the Administrative Agent in accordance with the
requirements of this Agreement, net of operating expenses, liquidation expenses
and commissions reasonably anticipated in the disposition of such assets and
(b) the denominator of which is the original cost of the aggregate amount of the
Eligible Inventory subject to such appraisal.

“Non-Consenting Lender” shall have the meaning provided in Section 10.01.

“Non-Extension Notice Date” shall have the meaning provided in
Section 2.03(b)(iii).

“Note” means (a) a promissory note made by the Borrowers in favor of a Lender
evidencing Loans made by such Lender, substantially in the form of Exhibit C-1,
and (b) the Swing Line Note, as each may be amended, supplemented or modified
from time to time.

“NPL” means the National Priorities List under CERCLA.

“Obligations” means (a) all advances to, and debts (including principal,
interest, fees, costs, and expenses), liabilities, obligations, covenants,
indemnities, and duties of, any Loan Party arising under any Loan Document or
otherwise with respect to any Loan or Letter of Credit (including payments in
respect of reimbursement of disbursements, interest thereon and obligations to
provide cash collateral therefor), whether direct or indirect (including those
acquired by assumption), absolute or contingent, due or to become due, now
existing or hereafter arising and including interest, fees, costs, expenses and
indemnities that accrue after the commencement by or against any Loan Party or
any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such
Person as the debtor in such proceeding, regardless of whether such interest
,fees, costs, expenses and indemnities are allowed or allowable claims in such
proceeding, and (b) Bank Product Obligations.

“Omnibus Share Compensation Plan” means the Stein Mart 2001 Omnibus Plan, as
amended, modified, supplemented, restated or replaced from time to time.

“Organization Documents” means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; (c) with respect to any
partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity, and (d) in each case, all shareholder or other
equity holder agreements, voting trusts and similar arrangements to which such
Person is a party or which is applicable to its Equity Interests and all other
arrangements relating to the Control or management of such Person.

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

“Outstanding Amount” means (i) with respect to Committed Loans and Swing Line
Loans on any date, the aggregate outstanding principal amount thereof after
giving effect to any borrowings and

 

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prepayments or repayments of Committed Loans and Swing Line Loans, as the case
may be, occurring on such date; and (ii) with respect to any LC Obligations on
any date, the amount of such LC Obligations on such date after giving effect to
any LC Credit Extension occurring on such date and any other changes in the
aggregate amount of the LC Obligations as of such date.

“Overadvance” means a Credit Extension to the extent that, immediately after its
having been made, Excess Availability is less than zero.

“Participant” shall have the meaning provided in Section 10.06(d).

“Payment Conditions” means, at the time of determination with respect to any
specified transaction or payment, that (a) no Default or Event of Default then
exists or would arise as a result of entering into such transaction or the
making such payment, (b) after giving effect to such transaction or payment, the
Pro Forma Availability Condition has been satisfied and the Consolidated Fixed
Charge Coverage Ratio, as projected on a pro-forma basis for the twelve
(12) months following such transaction or payment, will be equal to or greater
than 1.0:1.0. Prior to undertaking any transaction or payment which is subject
to the Payment Conditions, the Loan Parties shall deliver to the Administrative
Agent evidence of satisfaction of the conditions contained in clause (b) above
on a basis (including, without limitation, giving due consideration to results
for prior periods) reasonably satisfactory to the Administrative Agent.

“PBGC” means the Pension Benefit Guaranty Corporation.

“PCAOB” means the Public Company Accounting Oversight Board.

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

“Permitted Acquisition” means an Acquisition in which all of the following
conditions are satisfied:

(a) as of the date of such Acquisition and after giving effect thereto, no
Default or Event of Default shall exist or have occurred and be continuing;

(b) such Acquisition shall have been approved by the board of directors of the
Person (or similar governing body if such Person is not a corporation) which is
the subject of such Acquisition and such Person shall not have announced that it
will oppose such Acquisition or shall not have commenced any action which
alleges that such Acquisition shall violate applicable Law;

(c) the Lead Borrower shall have furnished the Administrative Agent with thirty
(30) days’ prior written notice of such intended Acquisition and shall have
furnished the Administrative Agent with a current draft of the Acquisition
Documents (and final copies thereof as and when executed), a summary of any due
diligence undertaken by the Loan Parties in connection with such Acquisition,
appropriate financial statements of the Person which is the subject of such
Acquisition, pro forma projected financial statements for the twelve (12) month
period following such Acquisition after giving effect to such Acquisition
(including balance sheets, cash flows and income statements by month for the
acquired Person, individually, and on a Consolidated basis with all Loan
Parties), and such other information as the Administrative Agent may reasonably
require, all of which shall be reasonably satisfactory to the Administrative
Agent;

 

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(d) either (i) the legal structure of the Acquisition shall be acceptable to the
Administrative Agent in its discretion, or (ii) the Loan Parties shall have
provided the Administrative Agent with a favorable solvency opinion from an
unaffiliated third party valuation firm reasonably satisfactory to the
Administrative Agent;

(e) after giving effect to the Acquisition, if the Acquisition is an Acquisition
of the Equity Interests, a Loan Party shall acquire and own, directly or
indirectly, not less than a majority of the Equity Interests having any voting
rights;

(f) any assets acquired shall be utilized in, and if the Acquisition involves a
merger, consolidation or stock acquisition, the Person which is the subject of
such Acquisition shall be engaged in, a business otherwise permitted to be
engaged in by a Borrower under this Agreement;

(g) if the Person which is the subject of such Acquisition will be maintained as
a Subsidiary of a Loan Party, or if the assets acquired in an acquisition will
be transferred to a Subsidiary which is not then a Loan Party, such Subsidiary
shall have been joined as a “Borrower” hereunder or as a Facility Guarantor, as
the Administrative Agent shall determine, and the Administrative Agent shall
have received a first priority security interest in any Equity Interests in such
Subsidiary held by any Loan Party, and in such Subsidiary’s Inventory, Accounts,
and other property of the same nature as then constitutes Collateral under the
Security Documents; and

(h) the Loan Parties shall have satisfied the Payment Conditions.

“Permitted Discretion” means as used in this Agreement and the other Loan
Documents with reference to the Administrative Agent, a determination made in
good faith in the exercise of its reasonable business judgment based on how an
asset-based lender with similar rights providing a credit facility of the type
set forth herein would act in similar circumstances at the time with the
information then available to it.

“Permitted Disposition” means any of the following:

(a) dispositions of inventory in the ordinary course of business;

(b) bulk sales of other dispositions of the Inventory of a Loan Party not in the
ordinary course of business in connection with Store closings, at arm’s length,
provided, that such Store closures and related Inventory dispositions shall not
exceed (Store closings permitted pursuant to this clause (b) are referred to as
“Permitted Store Closings”): (i) during any one (1) year period, including the
one (1) year period immediately preceding the Closing Date, the number of retail
store locations closed or sold by Borrowers (excluding for the purposes hereof
retail store locations that Borrowers are in the process of closing as of the
Closing Date) minus the number of Stores opened by Borrowers during any such one
(1) year period, shall not exceed the amount equal to ten (10%) percent of the
number of store locations of Borrowers as of the day immediately preceding the
commencement of any such one (1) year period, and (ii) in the aggregate during
any three (3) year period from and after the Closing Date, fifteen (15%) percent
of the number of the Loan Parties’ Stores in existence as of the Closing Date
(net of new Store openings), provided, that, (A) all sales of Inventory in
connection with five (5) or more Store closings which occur substantially
simultaneously or pursuant to any Store closing plan adopted by Loan Parties
(regardless of when the Store closings actually occur) shall be conducted with
the assistance of professional liquidators reasonably acceptable to the
Administrative Agent, (B) the Administrative Agent

 

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shall have received not less than ten (10) Business Days prior written notice of
such sale or Store closing, which notice shall set forth in reasonable detail
satisfactory to the Administrative Agent, the parties to such sale or other
disposition, the assets to be sold or otherwise disposed of, the purchase price
and the manner of payment thereof and such other information with respect
thereto as the Administrative Agent may reasonably request, (C) as of the date
of such sale or other disposition and after giving effect thereto, no Event of
Default shall exist or have occurred and be continuing, and (D) all Net Proceeds
received in connection therewith shall be applied to the Obligations if then
required in accordance with Section 2.05 hereof;

(c) licenses of Intellectual Property of a Loan Party or any of its Subsidiaries
in the ordinary course of business;

(d) licenses for the conduct of licensed departments within the Loan Parties’
Stores in the ordinary course of business; provided that, if requested by the
Administrative Agent, the Administrative Agent shall have entered into an
intercreditor agreement with the Person operating such licensed department on
terms and conditions reasonably satisfactory to the Administrative Agent

(e) Dispositions of Equipment (i) in the ordinary course of business that is
substantially worn, damaged, obsolete or, in the judgment of a Loan Party, no
longer useful or necessary in its business or that of any Subsidiary and is not
replaced with similar property having at least equivalent value, and (ii) in
connection with Permitted Store Closings (which Permitted Dispositions described
in this clause (e) shall be in addition to, and not in limitation of, the
Dispositions by any Borrower and its Subsidiaries of other assets and properties
permitted in clause (j) of this definition);

(f) sales, transfers and dispositions among the Loan Parties or by any
Subsidiary to a Loan Party;

(g) sales, transfers and dispositions by any Subsidiary which is not a Loan
Party to another Subsidiary that is not a Loan Party;

(h) the issuance and sale by any Borrower of Equity Interests of such Borrower
after the date hereof; provided, that, (i) other than such Equity Interests at
any time issued to any of Borrowers’ employees as additional compensation
pursuant to the Omnibus Share Compensation Plan, the Administrative Agent shall
have received not less than ten (10) Business Days’ prior notice of such
issuance and sale by such Borrower, which notice shall specify the parties to
whom such Equity Interests are to be sold, the terms of such sale, the total
amount which it is anticipated will be realized from the issuance and sale of
such Equity Interests and the Net Proceeds which it is anticipated will be
received by such Borrower from such sale, (ii) such Borrower 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 7.06 hereof, (iii) the terms of such Equity Interests, and the terms and
conditions of the purchase and sale thereof, shall not include any terms that
include any limitation on the right of any Borrower to request or receive Loans
or Letters of Credit or the right of any Borrower to amend or modify any of the
terms and conditions of this Agreement or any of the other Loan Documents or
otherwise in any way relate to or affect the arrangements of Borrowers with the
Administrative Agent and Lenders or are more restrictive or burdensome to any
Borrower than the terms of any Equity Interests in effect on the date hereof,
and (iv) 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;

(i) the issuance of Equity Interests of any Borrower consisting of common stock
pursuant to an employee stock option or grant, employee stock purchase plan or
similar equity plan or 401(k) plans of such Borrower for the benefit of its
employees, directors and consultants, provided, that,

 

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in no event shall such Borrower be required to issue, or shall such Borrower
issue, Equity Interests pursuant to such stock plans or 401(k) plans which would
result in a Change of Control or other Event of Default

(j) Dispositions by any Borrower and its Subsidiaries of other assets and
properties not otherwise described in clauses (a) through (i) above that are not
then included in the Borrowing Base, provided that (i) at the time of such
Disposition, no Default shall exist or would result from such Disposition,
(ii) the aggregate book value of all property Disposed of in reliance on this
clause (j) in any Fiscal Year shall not exceed $3,000,000, (iii) the purchase
price for such asset shall be paid to such Borrower or Subsidiary solely in
cash, and (iv) all Net Proceeds received in connection therewith shall be
applied to the Obligations if then required in accordance with Section 2.05
hereof; and

(k) the sale of Factored Receivables by a Loan Party to Wells Fargo or any of
its Affiliates, provided that all Net Proceeds received in connection therewith
shall be applied to the Obligations if then required in accordance with
Section 2.05 hereof.

“Permitted Encumbrances” means:

(a) Liens imposed by law for Taxes that are not yet due or are being contested
in compliance with Section 6.04;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other
like Liens imposed by applicable Law, arising in the ordinary course of business
and securing obligations that are not overdue or are being contested in
compliance with Section 6.04;

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

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

(e) Liens in respect of judgments that would not constitute an Event of Default
hereunder;

(f) easements, covenants, conditions, restrictions, building code laws, zoning
restrictions, rights-of-way and similar encumbrances on real property imposed by
law or arising in the ordinary course of business that do not secure any
monetary obligations and do not materially detract from the value of the
affected property or materially interfere with the ordinary conduct of business
of a Loan Party and such other minor title defects or survey matters that are
disclosed by current surveys that, in each case, do not materially interfere
with the current use of the real property;

(g) Liens existing on the date hereof and listed on Schedule 7.01 and any
renewals or extensions thereof, provided that (i) the property covered thereby
is not changed, (ii) the amount secured or benefited thereby is not increased,
(iii) the direct or any contingent obligor with respect thereto is not changed,
and (iv) any renewal or extension of the obligations secured or benefited
thereby is otherwise permitted hereunder);

(h) Liens on fixed or capital assets acquired by any Loan Party which are
permitted under clause (c) of the definition of Permitted Indebtedness so long
as (i) such Liens and the Indebtedness

 

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secured thereby are incurred prior to or within ninety (90) days after such
acquisition, (ii) the Indebtedness secured thereby does not exceed the cost of
acquisition of such fixed or capital assets and (iii) such Liens shall not
extend to any other property or assets of the Loan Parties;

(i) Liens in favor of the Administrative Agent;

(j) landlords’ and lessors’ Liens in respect of rent not in default;

(k) possessory Liens in favor of brokers and dealers arising in connection with
the acquisition or disposition of Investments owned as of the date hereof and
Permitted Investments, provided that such liens (a) attach only to such
Investments and (b) secure only obligations incurred in the ordinary course and
arising in connection with the acquisition or disposition of such Investments
and not any obligation in connection with margin financing;

(l) Liens arising solely by virtue of any statutory or common law provisions
relating to banker’s liens, liens in favor of securities intermediaries, rights
of setoff or similar rights and remedies as to deposit accounts or securities
accounts or other funds maintained with depository institutions or securities
intermediaries;

(m) Liens arising from precautionary UCC filings regarding “true” operating
leases or, to the extent permitted under the Loan Documents, the consignment of
goods to a Loan Party;

(n) voluntary Liens on property (other than property of the type included in the
Borrowing Base) in existence at the time such property is acquired pursuant to a
Permitted Acquisition or on such property of a Subsidiary of a Loan Party in
existence at the time such Subsidiary is acquired pursuant to a Permitted
Acquisition; provided, that, such Liens are not incurred in connection with or
in anticipation of such Permitted Acquisition and do not attach to any other
assets of any Loan Party or any Subsidiary;

(o) Liens or rights of setoff against credit balances of Borrowers with Credit
Card Issuers or Credit Card Processors or amounts owing by such Credit Card
Issuers or Credit Card Processors to Borrower in the ordinary course of business
(but not Liens on or rights of setoff against any other property or assets of
Borrowers), pursuant to the Credit Card Agreements (as in effect on the date
hereof) to secure the obligations of Borrowers to the Credit Card Issuers as a
result of fees and chargebacks;

(p) Liens in favor of customs and revenues authorities imposed by applicable Law
arising in the ordinary course of business in connection with the importation of
goods and securing obligations that are being contested in good faith by
appropriate proceedings, provided, that, (i) the applicable Loan Party or
Subsidiary has set aside on its books adequate reserves with respect thereto in
accordance with GAAP and (ii) such contest effectively suspends collection of
the contested obligation and enforcement of any Lien securing such obligation;
and

(q) Liens in assets and properties of Borrowers that do not constitute
Collateral to secure Permitted Indebtedness permitted under clause (j) of the
definition of Permitted Indebtedness; provided, that, if any such Permitted
Indebtedness is secured by any of a Loan Party’s Intellectual Property (an “IP
Lien”), then the Person to whom such IP Lien is granted shall have entered into
an agreement with the Administrative Agent, in form and substance reasonably
satisfactory to Administrative Agent, pursuant to which (among other things)
such Person shall acknowledge and confirm that neither the granting of the IP
Lien nor any enforcement thereof by such Person shall in any manner limit,
impair or otherwise affect the Administrative Agent’s exercise of its
non-exclusive license rights granted to Administrative Agent with respect to
such Loan Party’s Intellectual Property pursuant to Section 16(b) of the
Security Agreement.

 

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“Permitted Indebtedness” means each of the following as long as no Default or
Event of Default exists or would arise from the incurrence thereof:

(a) Indebtedness outstanding on the date hereof and listed on Schedule 7.03 and
any refinancings, refundings, renewals or extensions thereof; provided that
(i) the amount of such Indebtedness is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to a
reasonable premium or other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such refinancing and by an amount equal
to any existing commitments unutilized thereunder, and the direct or contingent
obligor with respect thereto is not changed as a result of or in connection with
such refinancing, refunding, renewal or extension, (ii) the result of such
extension, renewal or replacement shall not be an earlier maturity date or
decreased weighted average life of such Indebtedness, and (iii) the terms
relating to principal amount, amortization, maturity, collateral (if any) and
subordination (if any), and other material terms taken as a whole, of any such
refinancing, refunding, renewing or extending Indebtedness, and of any agreement
entered into and of any instrument issued in connection therewith, are no less
favorable in any material respect to the Loan Parties or the Lenders than the
terms of any agreement or instrument governing the Indebtedness being
refinanced, refunded, renewed or extended and the interest rate applicable to
any such refinancing, refunding, renewing or extending Indebtedness does not
exceed the then applicable market interest rate;

(b) Indebtedness of any Loan Party to any other Loan Party;

(c) purchase money Indebtedness of any Loan Party to finance the acquisition of
any fixed or capital assets, including Capital Lease Obligations and Synthetic
Lease Obligations, and any Indebtedness assumed in connection with the
acquisition of any such assets or secured by a Lien on any such assets prior to
the acquisition thereof, and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount thereof or
result in an earlier maturity date or decreased weighted average life thereof,
provided that, (i) the terms relating to principal amount, amortization,
maturity, collateral (if any) and subordination (if any), and other material
terms taken as a whole, of any such refinancing, refunding, renewing or
extending Indebtedness, and of any agreement entered into and of any instrument
issued in connection therewith, are no less favorable in any material respect to
the Loan Parties or the Lenders than the terms of any agreement or instrument
governing the Indebtedness being refinanced, refunded, renewed or extended and
the interest rate applicable to any such refinancing, refunding, renewing or
extending Indebtedness does not exceed the then applicable market interest rate,
and (ii) the aggregate principal amount of Indebtedness permitted by this clause
(c) shall not exceed $10,000,000 at any time outstanding and further provided
that, if requested by the Administrative Agent, the Loan Parties shall cause the
holders of such Indebtedness to enter into a Collateral Access Agreement on
terms reasonably satisfactory to the Administrative Agent;

(d) obligations (contingent or otherwise) of any Loan Party or any Subsidiary
thereof existing or arising under any Swap Contract, provided that such
obligations are (or were) entered into by such Person in the ordinary course of
business for the purpose of directly mitigating risks associated with
fluctuations in interest rates or foreign exchange rates, and not for purposes
of speculation or taking a “market view;” provided that the aggregate Swap
Termination Value thereof shall not exceed $2,500,000 at any time outstanding;

(e) contingent liabilities under surety bonds or similar instruments incurred in
the ordinary course of business in connection with the construction or
improvement of Stores;

 

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(f) [Reserved];

(g) Indebtedness with respect to the deferred purchase price for any Permitted
Acquisition, provided, that, (i) payment in cash of principal in respect of such
Indebtedness (other than in respect of working capital adjustments) shall only
be permitted if at the time of any such payment and after giving effect thereto,
Loan Parties have satisfied the Payment Conditions, (ii) such Indebtedness shall
have a maturity which extends beyond the Maturity Date and shall be subordinated
to the Obligations on terms reasonably acceptable to the Administrative Agent;

(h) Indebtedness of any Person that becomes a Subsidiary of a Loan Party in a
Permitted Acquisition, which Indebtedness is existing at the time such Person
becomes a Subsidiary of a Loan Party (other than Indebtedness incurred solely in
contemplation of such Person’s becoming a Subsidiary of a Loan Party);

(i) the Obligations; and

(j) Indebtedness not specifically described in clauses (a) through (i) above in
an aggregate principal amount not to exceed $15,000,000 at any time outstanding;
provided, that, if any such Permitted Indebtedness is secured by an IP Lien,
then the Person to whom such IP Lien is granted shall have entered into a
written agreement with the Administrative Agent as required by clause (q) of the
definition of Permitted Encumbrances.

“Permitted Investments” means each of the following as long as no Default or
Event of Default exists or would arise from the making of such Investment:

(a) readily marketable obligations issued or directly and fully guaranteed or
insured by the United States of America or any agency or instrumentality thereof
having maturities of not more than three hundred sixty (360) days from the date
of acquisition thereof; provided that the full faith and credit of the United
States of America is pledged in support thereof;

(b) commercial paper issued by any Person organized under the laws of any state
of the United States of America and rated at least “Prime-1” (or the then
equivalent grade) by Moody’s or at least “A-1” (or the then equivalent grade) by
S&P, in each case with maturities of not more than one hundred eighty (180) days
from the date of acquisition thereof;

(c) time deposits with, or insured certificates of deposit or bankers’
acceptances of, any commercial bank that (i) (A) is a Lender or (B) is organized
under the laws of the United States of America, any state thereof or the
District of Columbia or is the principal banking subsidiary of a bank holding
company organized under the laws of the United States of America, any state
thereof or the District of Columbia, and is a member of the Federal Reserve
System, (ii) issues (or the parent of which issues) commercial paper rated as
described in clause (c) of this definition and (iii) has combined capital and
surplus of at least $1,000,000,000, in each case with maturities of not more
than one hundred eighty (180) days from the date of acquisition thereof;

(d) fully collateralized repurchase agreements with a term of not more than
thirty (30) days for securities described in clause (a) above (without regard to
the limitation on maturity contained in such clause) and entered into with a
financial institution satisfying the criteria described in clause (c) above or
with any primary dealer and having a market value at the time that such
repurchase agreement is entered into of not less than one hundred percent
(100%) of the repurchase obligation of such counterparty entity with whom such
repurchase agreement has been entered into;

 

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(e) Investments, classified in accordance with GAAP as current assets of the
Loan Parties, in any money market fund, mutual fund, or other investment
companies that are registered under the Investment Company Act of 1940, as
amended, which are administered by financial institutions that have the highest
rating obtainable from either Moody’s or S&P, and which invest solely in one or
more of the types of securities described in clauses (a) through (d) above;

(f) Investments existing on the Closing Date, and set forth on Schedule 7.02,
but not any increase in the amount thereof or any other modification of the
terms thereof;

(g) (i) Investments by any Loan Party and its Subsidiaries in their respective
Subsidiaries outstanding on the date hereof, (ii) additional Investments by any
Loan Party and its Subsidiaries in other Loan Parties, and (iii) additional
Investments by Subsidiaries of any Borrower that are not Loan Parties in other
Subsidiaries that are not Loan Parties, provided, that, as to all of such
Investments, (A) within thirty (30) days after the end of each fiscal month,
Borrowers shall provide to Agent a report in form and substance satisfactory to
Agent of the outstanding amount of such Investments as of the last day of the
immediately preceding month and, in the case of any Investments consisting of
loans, indicating the amount of any loans made and payments received during the
immediately preceding month, (B) as of the date of any such loan and after
giving effect thereto, the Borrower making such Investments shall be Solvent,
and (C) as of the date of any such Investments and after giving effect thereto,
no Default or Event of Default shall exist or have occurred and be continuing;

(h) Investments consisting of extensions of credit in the nature of accounts
receivable or notes receivable arising from the grant of trade credit in the
ordinary course of business, and Investments received in satisfaction or partial
satisfaction thereof from financially troubled account debtors to the extent
reasonably necessary in order to prevent or limit loss;

(i) guarantees constituting Permitted Indebtedness;

(j) Investments by any Loan Party in Swap Contracts entered into in the ordinary
course of business and for bona fide business (and not speculative purposes) to
protect against fluctuations in interest rates in respect of the Obligations;

(k) Investments received in connection with the bankruptcy or reorganization of,
or settlement of delinquent accounts and disputes with, customers and suppliers,
in each case in the ordinary course of business;

(l) advances to officers, directors and employees of the Loan Parties and
Subsidiaries in the ordinary course of business in an amount not to exceed
$50,000 to any individual at any time or in an aggregate amount not to exceed
$50,000 at any time outstanding, for (i) reasonably and necessary work-related
travel or other ordinary business expenses to be incurred by such employee in
connection with their work for such Borrower and (ii) reasonable and necessary
relocation expenses of such employees (including home mortgage financing for
relocated employees);

(m) Investments constituting Permitted Acquisitions and Permitted Indebtedness;

(n) Investments with respect to the Split-Dollar Life Insurance Plan and the
Deferred Compensation Plan consisting of (i) the Loan Parties’ purchase of life
insurance policies from time to time for the purpose of offsetting liabilities
which the Loan Parties anticipate will arise with respect to each such Plan, and
(ii) the Loan Parties’ payment of premiums which become due and payable with
respect to such life insurance policies, so long as at the time of any such
Investment and after giving effect thereto, no Default or Event of Default shall
have then occurred and be continuing; and

 

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(o) other Investments not described in clauses (a) through (n) above not
exceeding $1,000,000 in the aggregate in any Fiscal Year, so long as at the time
thereof and after giving effect thereto, no Default or Event of Default shall
have then occurred and be continuing;

provided, however, that notwithstanding the foregoing, after the occurrence and
during the continuance of a Cash Dominion Event, no such Investments specified
in clauses (a) through (e) shall be permitted unless (i) either (A) no Loans are
then outstanding, or (B) the Investment is a temporary Investment pending
expiration of an Interest Period for a LIBO Rate Loan, the proceeds of which
Investment will be applied to the Obligations after the expiration of such
Interest Period, and (ii) such Investments are pledged to the Administrative
Agent as additional collateral for the Obligations pursuant to such agreements
as may be reasonably required by the Administrative Agent.

“Permitted Overadvance” means an Overadvance made by the Administrative Agent,
in its discretion, which:

(a) is made to maintain, protect or preserve the Collateral and/or the Credit
Parties’ rights under the Loan Documents or which is otherwise for the benefit
of the Credit Parties; or

(b) is made to enhance the likelihood of, or to maximize the amount of,
repayment of any Obligation;

(c) is made to pay any other amount chargeable to any Loan Party hereunder; and

(d) together with all other Permitted Overadvances then outstanding, shall not
(i) exceed ten percent (10%) of the Borrowing Base at any time or (ii) unless a
Liquidation is occurring, remain outstanding for more than forty-five
(45) consecutive Business Days, unless in each case, the Required Lenders
otherwise agree.

provided however, that the foregoing shall not (i) modify or abrogate any of the
provisions of Section 2.03 regarding the Lenders’ obligations with respect to
Letters of Credit, or (ii) result in any claim or liability against the
Administrative Agent (regardless of the amount of any Overadvance) for
Unintentional Overadvances and such Unintentional Overadvances shall not reduce
the amount of Permitted Overadvances allowed hereunder, and further provided
that in no event shall the Administrative Agent make an Overadvance, if after
giving effect thereto, the principal amount of the Credit Extensions would
exceed the Aggregate Commitments (as in effect prior to any termination of the
Commitments pursuant to Section 2.06 hereof).

“Permitted Store Closings” shall have the meaning provided in clause (b) of the
definition of Permitted Dispositions.

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

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

“Platform” shall have the meaning provided in Section 6.02.

 

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“Prepayment Event” means:

(a) any Disposition (including pursuant to a sale and leaseback transaction) of
any property or asset of a Loan Party (other than Dispositions of inventory in
the ordinary course of business) in an aggregate amount in excess of $3,000,000
in any Fiscal Year (such amount, the “Prepayment Minimum Disposition Amount”),
provided, that, if a Cash Dominion Event has occurred and is continuing, there
shall be no Prepayment Minimum Disposition Amount and any and all of the
foregoing Dispositions (other than Dispositions of inventory in the ordinary
course of business) shall be deemed and shall constitute a Prepayment Event;

(b) any casualty or other insured damage to, or any taking under power of
eminent domain or by condemnation or similar proceeding of (and payments in lieu
thereof), any property or asset of a Loan Party in an aggregate amount in excess
of $100,000 in any Fiscal Year, unless (i) the proceeds therefrom are required
to be paid to the holder of a Lien on such property or asset having priority
over the Lien of the Administrative Agent or (ii) prior to the occurrence of a
Cash Dominion Event, (A) the proceeds therefrom, in the case of any casualty
damage, are utilized for purposes of replacing or repairing the assets in
respect of which such proceeds, awards or payments were received within one
hundred eighty (180) days of the occurrence of the damage to or loss of the
assets being repaired or replaced, and (B) notwithstanding anything to the
contrary set forth in this clause (b), in the case of any proceeds that become
payable under any business interruption policies of Loan Parties, the Loan
Parties’ receipt of such proceeds to the extent permitted by Section 6.07(c)
shall not be deemed to be or constitute a Prepayment Event, and a Prepayment
Event shall only be deemed to have occurred, and such proceeds shall applied to
the Obligations, only if and to the extent required by Section 6.07(c);

(c) the issuance by a Loan Party of any Equity Interests, other than any such
issuance of Equity Interests (i) to a Loan Party, (ii) as consideration for a
Permitted Acquisition, (iii) to the extent that the Net Proceeds are used within
ninety (90) days thereafter to finance a Permitted Acquisition or Permitted
Investment, or (iv) as a compensatory issuance to any employee, director, or
consultant (including under any option plan);

(d) the incurrence by a Loan Party of any Indebtedness for borrowed money
permitted hereunder other than Permitted Indebtedness; or

(e) the receipt by any Loan Party of any Extraordinary Receipts.

“Pro Forma Availability Condition” means (a) for any date of calculation with
respect to any Restricted Payments, the Pro Forma Excess Availability following,
and after giving effect to, such Restricted Payments, will be equal to or
greater than the greater of (i) Twenty Million Dollars ($20,000,000) or
(ii) twenty percent (20%) of the Loan Cap, and (b) for any date of calculation
with respect to any proposed Permitted Acquisition, the Pro Forma Excess
Availability following, and after giving effect to, such Acquisition, will be
equal to or greater than the greater of (i) Fifteen Million Dollars
($15,000,000) or (ii) fifteen percent (15%) of the Loan Cap.

“Pro Forma Excess Availability” means, for any date of calculation, after giving
pro forma effect to the transaction then to be consummated the projected Average
Daily Availability during the subsequent projected twelve (12) Fiscal Months.

“Public Lender” shall have the meaning provided in Section 6.02.

“Real Estate” means all land, together with the buildings, structures, parking
areas, and other improvements thereon, now or hereafter owned by any Loan Party,
including all easements, rights-of-way, and similar rights relating thereto and
all leases, tenancies, and occupancies thereof.

 

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“Register” shall have the meaning provided in Section 10.06(c).

“Registered Public Accounting Firm” shall have the meaning provided by the
Securities Laws and shall be independent of the Lead Borrower and its
Subsidiaries as prescribed by the Securities Laws.

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

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

“Reports” shall have the meaning provided in Section 9.12(b).

“Request for Credit Extension” means (a) with respect to a Borrowing, conversion
or continuation of Committed Loans, a Committed Loan Notice, (b) with respect to
an LC Credit Extension, a Letter of Credit Application and, if required by the
LC Issuer, a Standby Letter of Credit Agreement or Commercial Letter of Credit
Agreement, as applicable, and (c) with respect to a Swing Line Loan, a Swing
Line Loan Notice.

“Required Lenders” means, as of any date of determination, at least two
(2) Lenders holding more than fifty percent (50%) of the Aggregate Commitments
or, if the commitment of each Lender to make Loans and the obligation of the LC
Issuer to make LC Credit Extensions have been terminated pursuant to
Section 8.02, any Lender or Lenders holding more than fifty percent (50%) of the
Total Outstandings (with the aggregate amount of each Lender’s risk
participation and funded participation in LC Obligations and Swing Line Loans
being deemed “held” by such Lender for purposes of this definition); provided
that, the Commitment of, and the portion of the Total Outstandings held or
deemed held by, any Defaulting Lender or Deteriorating Lender shall be excluded
for purposes of making a determination of Required Lenders.

“Responsible Officer” means the chief executive officer, president, chief
financial officer, treasurer or assistant treasurer of a Loan Party or any of
the other individuals designated in writing to the Administrative Agent by an
existing Responsible Officer of a Loan Party as an authorized signatory of any
certificate or other document to be delivered hereunder. Any document delivered
hereunder that is signed by a Responsible Officer of a Loan Party shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Loan Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Loan Party.

“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any capital stock or other Equity
Interest of any Person 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, defeasance,
acquisition, cancellation or termination of any such capital stock or other
Equity Interest, or on account of any return of capital to such Person’s
stockholders, partners or members (or the equivalent of any thereof), or any
option, warrant or other right to acquire any such dividend or other
distribution or payment. Without limiting the foregoing, “Restricted Payments”
with respect to any Person shall also include all payments made by such Person
with any proceeds of a dissolution or liquidation of such Person.

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

“Sarbanes-Oxley” means the Sarbanes-Oxley Act of 2002.

 

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

“Securities Laws” means the Securities Act of 1933, the Securities Exchange Act
of 1934, Sarbanes-Oxley, and the applicable accounting and auditing principles,
rules, standards and practices promulgated, approved or incorporated by the SEC
or the PCAOB.

“Security Agreement” means the Security Agreement dated as of the Closing Date
among the Loan Parties and the Administrative Agent.

“Security Documents” means, collectively, the following: the Security Agreement,
the Collateral Assignments of the Blocked Account Agreements, any Mortgages, the
DDA Notifications, the Credit Card Notifications, and each other security
agreement or other instrument or document now or hereafter executed and
delivered to the Administrative Agent pursuant to this Agreement or any other
Loan Document granting a Lien to secure any of the Obligations.

“Settlement Date” shall have the meaning provided in Section 2.14(a).

“Shareholders’ Equity” means, as of any date of determination, consolidated
shareholders’ equity of the Lead Borrower and its Subsidiaries as of that date
determined in accordance with GAAP.

“Shrink” means Inventory which has been lost, misplaced, stolen, or is otherwise
unaccounted for.

“Solvent” and “Solvency” means, with respect to any Person on a particular date,
that on such date (a) at fair valuation, all of the properties and assets of
such Person are greater than the sum of the debts, including contingent
liabilities, of such Person, (b) the present fair saleable value of the
properties and assets of such Person is not less than the amount that would be
required to pay the probable liability of such Person on its debts as they
become absolute and matured, (c) such Person is able to realize upon its
properties and assets and pay its debts and other liabilities, contingent
obligations and other commitments as they mature in the normal course of
business, (d) such Person does not intend to, and does not believe that it will,
incur debts beyond such Person’s ability to pay as such debts mature, and
(e) such Person is not engaged in a business or a transaction, and is not about
to engage in a business or transaction, for which such Person’s properties and
assets would constitute unreasonably small capital after giving due
consideration to the prevailing practices in the industry in which such Person
is engaged. The amount of all guarantees at any time shall be computed as the
amount that, in light of all the facts and circumstances existing at the time,
can reasonably be expected to become an actual or matured liability.

“Split-Dollar Life Insurance Plan” means each Split Dollar Agreement between an
employee of any Borrower and such Borrower, providing certain benefits to
designated beneficiaries upon the death of such employee, as each such Split
Dollar Agreement is entered into from time to time, as amended, modified,
supplemented, restated or replaced from time to time.

“Spot Rate” shall have the meaning provided in Section 1.07.

“Standby Letter of Credit” means any Letter of Credit that is not a Commercial
Letter of Credit and that (a) is used in lieu or in support of performance
guaranties or performance, surety or similar bonds (excluding appeal bonds)
arising in the ordinary course of business, (b) is used in lieu or in support of
stay or appeal bonds, (c) supports the payment of insurance premiums for
reasonably necessary casualty insurance carried by any of the Loan Parties, or
(d) supports payment or performance for identified purchases or exchanges of
products or services in the ordinary course of business.

 

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“Standby Letter of Credit Agreement” means the Standby Letter of Credit
Agreement relating to the issuance of a Standby Letter of Credit in the form
from time to time in use by the LC Issuer.

“Stated Amount” means at any time the maximum amount for which a Letter of
Credit may be honored.

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

“Stein Mart” shall have the meaning provided in the introductory paragraph
hereto.

“Store” means any retail store (which may include any real property, fixtures,
equipment, inventory and other property related thereto) operated, or to be
operated, by any Loan Party.

“Subordinated Indebtedness” means Indebtedness which is expressly subordinated
in right of payment to the prior payment in full of the Obligations and which is
in form and on terms approved in writing by the Administrative Agent.

“Subordination Provisions” shall have the meaning provided in Section 8.01(r).

“Subsidiary” of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares Equity Interests having ordinary voting power for the election of
directors or other governing body are at the time beneficially owned, or the
management of which is otherwise controlled, directly, or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise specified, all
references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a
Subsidiary or Subsidiaries of a Loan Party.

“Supermajority Lenders” means, as of any date of determination, at least two
(2) Lenders holding more than sixty-six and two-thirds percent (66-2/3%) of the
Aggregate Commitments or, if the commitment of each Lender to make Loans and the
obligation of the LC Issuer to make LC Credit Extensions have been terminated
pursuant to Section 8.02, any Lender or Lenders holding more than sixty-six and
two-thirds percent (66-2/3%) of the Total Outstandings (with the aggregate
amount of each Lender’s risk participation and funded participation in LC
Obligations and Swing Line Loans being deemed “held” by such Lender for purposes
of this definition); provided that, the Commitment of, and the portion of the
Total Outstandings held or deemed held by, any Defaulting Lender or
Deteriorating Lender shall be excluded for purposes of making a determination of
Supermajority Lenders.

“Swap Contract” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap

 

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transactions, cross-currency rate swap transactions, currency options, spot
contracts, or any other similar transactions or any combination of any of the
foregoing (including any options to enter into any of the foregoing), whether or
not any such transaction is governed by or subject to any master agreement, and
(b) any and all transactions of any kind, and the related confirmations, which
are subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives Association,
Inc., any International Foreign Exchange Master Agreement, or any other master
agreement (any such master agreement, together with any related schedules, a
“Master Agreement”), including any such obligations or liabilities under any
Master Agreement.

“Swap Termination Value” means, in respect of any one or more Swap Contracts,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contracts, (a) for any date on or after the date
such Swap Contracts have been closed out and termination value(s) determined in
accordance therewith, such termination value(s), and (b) for any date prior to
the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).

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

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

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

“Swing Line Loan” shall have the meaning provided in Section 2.04(a).

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

“Swing Line Note” means the promissory note of the Borrowers substantially in
the form of Exhibit C-2, payable to the order of the Swing Line Lender,
evidencing the Swing Line Loans made by the Swing Line Lender.

“Swing Line Sublimit” means an amount equal to ten percent (10%) of the
Aggregate Commitments. The Swing Line Sublimit is part of, and not in addition
to, the Aggregate Commitments.

“Synthetic Lease Obligation” means the monetary obligation of a Person under
(a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property (including sale and leaseback
transactions), in each case, creating obligations that do not appear on the
balance sheet of such Person but which, upon the application of any Debtor
Relief Laws to such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by and actually due to
any Governmental Authority, including any interest, additions to tax or
penalties applicable thereto.

“Termination Date” means the earliest to occur of (i) the Maturity Date,
(ii) the date on which the maturity of the Obligations is accelerated (or deemed
accelerated) and the Commitments are irrevocably terminated (or deemed
terminated) in accordance with Article VII, or (iii) the termination of the
Commitments in accordance with the provisions of Section 2.06(a) hereof.

 

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“Total Outstandings” means the aggregate Outstanding Amount of all Loans and all
LC Obligations.

“Trading With the Enemy Act” shall have the meaning provided in Section 10.18.

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

“UCC” or “Uniform Commercial Code” means the Uniform Commercial Code as in
effect from time to time in the State of New York; provided, however, that if a
term is defined in Article 9 of the Uniform Commercial Code differently than in
another Article thereof, the term shall have the meaning set forth in Article 9;
provided further that, if by reason of mandatory provisions of law, perfection,
or the effect of perfection or non-perfection, of a security interest in any
Collateral or the availability of any remedy hereunder is governed by the
Uniform Commercial Code as in effect in a jurisdiction other than State of New
York, “Uniform Commercial Code” means the Uniform Commercial Code as in effect
in such other jurisdiction for purposes of the provisions hereof relating to
such perfection or effect of perfection or non-perfection or availability of
such remedy, as the case may be.

“UCP 600” means the rules of the Uniform Customs and Practice for Documentary
Credits, as most recently published by the International Chamber of Commerce and
in effect as of July 1, 2007.

“UFCA” shall have the meaning provided in Section 10.22(d).

“UFTA” shall have the meaning provided in Section 10.22(d).

“Unfunded Pension Liability” means the excess of a Pension Plan’s benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan’s assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.

“Unintentional Overadvance” means an Overadvance which, to the Administrative
Agent’s knowledge, did not constitute an Overadvance when made but which has
become an Overadvance resulting from changed circumstances beyond the control of
the Credit Parties, including, without limitation, a reduction in the Appraised
Value of property or assets included in the Borrowing Base or misrepresentation
by the Loan Parties.

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

“Wells Fargo” means Wells Fargo Bank, N.A. and its successors.

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

(a) The definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms. The words
“include,” “includes” and “including” shall be deemed to be followed by the
phrase “without limitation.” The word “will” shall be construed to have the same
meaning and effect as the word “shall.” Unless the context requires otherwise,
(i) any

 

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definition of or reference to any agreement, instrument or other document
(including any Organization Document) shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein or in any other Loan
Document), (ii) any reference herein to any Person shall be construed to include
such Person’s successors and assigns, (iii) the words “herein,” “hereof” and
“hereunder,” and words of similar import when used in any Loan Document, shall
be construed to refer to such Loan Document in its entirety and not to any
particular provision thereof, (iv) all references in a Loan Document to
Articles, Sections, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Exhibits and Schedules to, the Loan Document in
which such references appear, (v) any reference to any law shall include all
statutory and regulatory provisions consolidating, amending replacing or
interpreting such law and any reference to any law or regulation shall, unless
otherwise specified, refer to such law or regulation as amended, modified or
supplemented from time to time, and (vi) the words “asset” and “property” shall
be construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.

(b) 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.”

(c) Section headings herein and in the other Loan Documents are included for
convenience of reference only and shall not affect the interpretation of this
Agreement or any other Loan Document.

(d) Any reference herein or in any other Loan Document to the satisfaction,
repayment, or payment in full of the Obligations shall mean the repayment in
Dollars in full in cash or immediately available funds (or, in the case of
contingent reimbursement obligations with respect to Letters of Credit and Bank
Products (other than Swap Contracts), providing Cash Collateralization) of all
of the Obligations (including the payment of any termination amount then
applicable (or which would or could become applicable as a result of the
repayment of the other Obligations) under Swap Contracts) other than
(i) unasserted contingent indemnification Obligations, (ii) any Obligations
relating to Bank Products (other than Swap Contracts) that, at such time, are
allowed by the applicable Bank Product provider to remain outstanding without
being required to be repaid or Cash Collateralized, and (iii) any Obligations
relating to Swap Contracts that, at such time, are allowed by the applicable
provider of such Swap Contracts to remain outstanding without being required to
be repaid.

1.03. Accounting Terms

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

(b) Changes in GAAP. If at any time any change in GAAP would affect the
computation of any financial ratio or requirement set forth in any Loan
Document, and either the Lead Borrower or the Required Lenders shall so request,
the Administrative Agent, the Lenders and the Lead Borrower shall negotiate in
good faith to amend such ratio or requirement to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of the Required
Lenders); provided that, until so amended, (i) such ratio or requirement shall
continue to be computed in accordance with GAAP

 

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prior to such change therein and (ii) the Lead Borrower shall provide to the
Administrative Agent and the Lenders financial statements and other documents
required under this Agreement or as reasonably requested hereunder setting forth
a reconciliation between calculations of such ratio or requirement made before
and after giving effect to such change in GAAP.

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

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

1.06. Letter of Credit Amounts. Unless otherwise specified, all references
herein to the amount of a Letter of Credit at any time shall be deemed to be the
Stated Amount of such Letter of Credit in effect at such time; provided,
however, that with respect to any Letter of Credit that, by its terms of any
Issuer Documents related thereto, provides for one or more automatic increases
in the Stated Amount thereof, the amount of such Letter of Credit shall be
deemed to be the maximum Stated Amount of such Letter of Credit after giving
effect to all such increases, whether or not such maximum Stated Amount is in
effect at such time.

1.07. Currency Equivalents Generally. Any amount specified in this Agreement
(other than in Articles II, IX and X) or any of the other Loan Documents to be
in Dollars shall also include the equivalent of such amount in any currency
other than Dollars, such equivalent amount thereof in the applicable currency to
be determined by the Administrative Agent at such time on the basis of the Spot
Rate (as defined below) for the purchase of such currency with Dollars. For
purposes of this Section 1.07, the “Spot Rate” for a currency means the rate
determined by the Administrative Agent to be the rate quoted by the Person
acting in such capacity as the spot rate for the purchase by such Person of such
currency with another currency through its principal foreign exchange trading
office at approximately 11:00 a.m. on the date two Business Days prior to the
date of such determination; provided that the Administrative Agent may obtain
such spot rate from another financial institution designated by the
Administrative Agent if the Person acting in such capacity does not have as of
the date of determination a spot buying rate for any such currency.

ARTICLE II

THE COMMITMENTS AND CREDIT EXTENSIONS

2.01. Committed Loans. Subject to the terms and conditions set forth herein,
each Lender severally agrees to make loans (each such loan, a “Committed Loan”)
to the Borrowers from time to time, on any Business Day during the Availability
Period, in an aggregate amount not to exceed at any time outstanding the lesser
of (a) the amount of such Lender’s Commitment, or (b) such Lender’s Applicable
Percentage of the Borrowing Base; subject in each case to the following
limitations:

(i) after giving effect to any Committed Borrowing, the Total Outstandings shall
not exceed the Loan Cap;

(ii) after giving effect to any Committed Borrowing, the aggregate Outstanding
Amount of the Committed Loans of any Lender, plus such Lender’s Applicable
Percentage of the Outstanding Amount of all LC Obligations, plus such Lender’s
Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall
not exceed such Lender’s Commitment; and

 

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(iii) the Outstanding Amount of all LC Obligations shall not at any time exceed
the Letter of Credit Sublimit.

Within the limits of each Lender’s Commitment, and subject to the other terms
and conditions hereof, the Borrowers may borrow under this Section 2.01, prepay
under Section 2.05, and reborrow under this Section 2.01. Committed Loans may be
Base Rate Loans or LIBO Rate Loans, as further provided herein.

2.02. Borrowings, Conversions and Continuations of Committed Loans.

(a) Committed Loans (other than Swing Line Loans) shall be either Base Rate
Loans or LIBO Rate Loans as the Lead Borrower may request subject to and in
accordance with this Section 2.02. All Swing Line Loans shall be only Base Rate
Loans. Subject to the other provisions of this Section 2.02, Committed
Borrowings of more than one Type may be incurred at the same time.

(b) Each Committed Borrowing, each conversion of Committed Loans from one Type
to the other, and each continuation of LIBO Rate Loans shall be made upon the
Lead Borrower’s irrevocable notice to the Administrative Agent, which may be
given by telephone. Each such notice must be received by the Administrative
Agent not later than 11:00 a.m. (i) three (3) Business Days prior to the
requested date of any Borrowing of, conversion to or continuation of LIBO Rate
Loans or of any conversion of LIBO Rate Loans to Base Rate Loans, and (ii) one
(1) Business Day prior to the requested date of any Borrowing of Base Rate
Loans. Each telephonic notice by the Lead Borrower pursuant to this
Section 2.02(b) must be confirmed promptly by delivery to the Administrative
Agent of a written Committed Loan Notice, appropriately completed and signed by
a Responsible Officer of the Lead Borrower. Each Borrowing of, conversion to or
continuation of LIBO Rate Loans shall be in a principal amount of $1,000,000 or
a whole multiple of $500,000 in excess thereof. Each Borrowing of or conversion
to Base Rate Loans shall be in a principal amount of $50,000 or a whole multiple
of $10,000 in excess thereof. Each Committed Loan Notice (whether telephonic or
written) shall specify (A) whether the Lead Borrower is requesting a Committed
Borrowing, a conversion of Committed Loans from one Type to the other, or a
continuation of LIBO Rate Loans, (B) the requested date of the Borrowing,
conversion or continuation, as the case may be (which shall be a Business Day),
(C) the principal amount of Committed Loans to be borrowed, converted or
continued, (D) the Type of Committed Loans to be borrowed or to which existing
Committed Loans are to be converted, and (E) if applicable, the duration of the
Interest Period with respect thereto. If the Lead Borrower fails to specify a
Type of Committed Loan in a Committed Loan Notice or if the Lead Borrower fails
to give a timely notice requesting a conversion or continuation, then the
applicable Committed Loans shall be made as, or converted to, Base Rate Loans.
Any such automatic conversion to Base Rate Loans shall be effective as of the
last day of the Interest Period then in effect with respect to the applicable
LIBO Rate Loans. If the Lead Borrower requests a Borrowing of, conversion to, or
continuation of LIBO Rate Loans in any such Committed Loan Notice, but fails to
specify an Interest Period, it will be deemed to have specified an Interest
Period of one month. Notwithstanding anything to the contrary herein, a Swing
Line Loan may not be converted to a LIBO Rate Loan.

(c) Following receipt of a Committed Loan Notice, the Administrative Agent shall
promptly notify each Lender of the amount of its Applicable Percentage of the
applicable Committed Loans, and if no timely notice of a conversion or
continuation is provided by the Lead Borrower, the Administrative Agent shall
notify each Lender of the details of any automatic conversion to Base Rate Loans
described in Section 2.02(b). In the case of a Committed Borrowing, each Lender
shall make the amount of its Committed Loan available to the Administrative
Agent in immediately available funds at the Administrative Agent’s Office not
later than 1:00 p.m. on the Business Day specified in the applicable Committed
Loan Notice. Upon satisfaction of the applicable conditions set forth in
Section 4.02 (and, if such Borrowing is the initial Credit Extension,
Section 4.01), the Administrative Agent shall use

 

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reasonable efforts to make all funds so received available to the Borrowers in
like funds by no later than 4:00 p.m. on the day of receipt by the
Administrative Agent either by (i) crediting the account of the Lead Borrower on
the books of Wells Fargo with the amount of such funds or (ii) wire transfer of
such funds, in each case in accordance with instructions provided to (and
reasonably acceptable to) the Administrative Agent by the Lead Borrower.

(d) The Administrative Agent, without the request of the Lead Borrower, may
advance any interest, fee, service charge (including direct wire fees), Credit
Party Expenses, or other payment to which any Credit Party is entitled from the
Loan Parties pursuant hereto or any other Loan Document and may charge the same
to the Loan Account notwithstanding that an Overadvance may result thereby. The
Administrative Agent shall advise the Lead Borrower of any such advance or
charge promptly after the making thereof. Such action on the part of the
Administrative Agent shall not constitute a waiver of the Administrative Agent’s
rights and the Borrowers’ obligations under Section 2.05(c). Any amount which is
added to the principal balance of the Loan Account as provided in this
Section 2.02(d) shall bear interest at the interest rate then and thereafter
applicable to Base Rate Loans.

(e) Except as otherwise provided herein, a LIBO Rate Loan may be continued or
converted only on the last day of an Interest Period for such LIBO Rate Loan.
During the existence of a Default, no Loans may be requested as, converted to or
continued as LIBO Rate Loans without the Consent of the Required Lenders.

(f) The Administrative Agent shall promptly notify the Lead Borrower and the
Lenders of the interest rate applicable to any Interest Period for LIBO Rate
Loans upon determination of such interest rate. At any time that Base Rate Loans
are outstanding, the Administrative Agent shall notify the Lead Borrower and the
Lenders of any change in Wells Fargo’s prime rate used in determining the Base
Rate promptly following the public announcement of such change.

(g) After giving effect to all Committed Borrowings, all conversions of
Committed Loans from one Type to the other, and all continuations of Committed
Loans of the same Type, there shall not be more than six (6) Interest Periods in
effect with respect to LIBO Rate Loans.

(h) The Administrative Agent, the Lenders, the Swing Line Lender and the LC
Issuer shall have no obligation to make any Loan or to provide any Letter of
Credit if an Overadvance would result. The Administrative Agent may, in its
discretion, make Permitted Overadvances without the consent of the Borrowers,
the Lenders, the Swing Line Lender and the LC Issuer and the Borrowers and each
Lender shall be bound thereby. Any Permitted Overadvance may constitute a Swing
Line Loan. A Permitted Overadvance is for the account of the Borrowers and shall
constitute a Base Rate Loan and an Obligation and shall be repaid by the
Borrowers in accordance with the provisions of Section 2.05(c). The making of
any such Permitted Overadvance on any one occasion shall not obligate the
Administrative Agent or any Lender to make or permit any Permitted Overadvance
on any other occasion or to permit such Permitted Overadvances to remain
outstanding. The making by the Administrative Agent of a Permitted Overadvance
shall not modify or abrogate any of the provisions of Section 2.03 regarding the
Lenders’ obligations to purchase participations with respect to Letter of
Credits or of Section 2.04 regarding the Lenders’ obligations to purchase
participations with respect to Swing Line Loans. The Administrative Agent shall
have no liability for, and no Loan Party or Credit Party shall have the right
to, or shall, bring any claim of any kind whatsoever against the Administrative
Agent with respect to Unintentional Overadvances regardless of the amount of any
such Overadvance(s).

 

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2.03. Letters of Credit.

(a) The Letter of Credit Commitment.

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

(ii) No Letter of Credit shall be issued if:

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

(B) subject to Section 2.03(b)(iii), the expiry date of such requested
Commercial Letter of Credit would occur more than 120 days after the date of
issuance or last extension, unless the Required Lenders have approved such
expiry date; or

(C) the expiry date of such requested Letter of Credit would occur after the
Letter of Credit Expiration Date, unless either such Letter of Credit is Cash
Collateralized on or prior to the date of issuance of such Letter of Credit (or
such later date as to which the Administrative Agent may agree) or all the
Lenders have approved such expiry date.

(iii) No Letter of Credit shall be issued without the prior consent of the
Administrative Agent if:

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

 

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(B) the issuance of such Letter of Credit would violate one or more policies of
the LC Issuer applicable to letters of credit generally;

(C) except as otherwise agreed by the Administrative Agent and the LC Issuer,
such Letter of Credit is in an initial Stated Amount less than $100,000, in the
case of a Commercial Letter of Credit, or $500,000, in the case of a Standby
Letter of Credit;

(D) such Letter of Credit is to be denominated in a currency other than Dollars;
provided that if the LC Issuer, in its discretion, issues a Letter of Credit
denominated in a currency other than Dollars, all reimbursements by the
Borrowers of the honoring of any drawing under such Letter of Credit shall be
paid in Dollars based on the Spot Rate;

(E) such Letter of Credit contains any provisions for automatic reinstatement of
the Stated Amount after any drawing thereunder; or

(F) a default of any Lender’s obligations to fund under Section 2.03(c) exists
or any Lender is at such time a Defaulting Lender or Deteriorating Lender
hereunder, unless the Administrative Agent or LC Issuer has entered into
satisfactory arrangements with the Borrowers or such Lender to eliminate the LC
Issuer’s risk with respect to such Lender.

(iv) The LC Issuer shall not amend any Letter of Credit if (A) the LC Issuer
would not be permitted at such time to issue such Letter of Credit in its
amended form under the terms hereof or (B) the beneficiary of such Letter of
Credit does not accept the proposed amendment to such Letter of Credit.

(v) The LC Issuer shall act on behalf of the Lenders with respect to any Letters
of Credit issued by it and the documents associated therewith, and the LC Issuer
shall have all of the benefits and immunities (A) provided to the Administrative
Agent in Article IX with respect to any acts taken or omissions suffered by the
LC Issuer in connection with Letters of Credit issued by it or proposed to be
issued by it and Issuer Documents pertaining to such Letters of Credit as fully
as if the term “Administrative Agent” as used in Article IX included the LC
Issuer with respect to such acts or omissions, and (B) as additionally provided
herein with respect to the LC Issuer.

(b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension
Letters of Credit.

(i) Each Letter of Credit shall be issued or amended, as the case may be, upon
the request of the Lead Borrower delivered to the LC Issuer (with a copy to the
Administrative Agent) in the form of a Letter of Credit Application,
appropriately completed and signed by a Responsible Officer of the Lead
Borrower. Such Letter of Credit Application must be received by the LC Issuer
and the Administrative Agent not later than 11:00 a.m. at least two Business
Days (or such other date and time as the Administrative Agent and the LC Issuer
may agree in a particular instance in their sole discretion) prior to the
proposed issuance date or date of amendment, as the case may be. In the case of
a request for an initial issuance of a Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the Administrative
Agent and the LC Issuer: (A) the proposed issuance date of the requested Letter
of Credit (which shall be a Business Day); (B) the amount thereof; (C) the
expiry date thereof; (D) the name and address of the beneficiary thereof;
(E) the documents to be presented by such beneficiary in case of any drawing
thereunder; (F) the full text of any certificate to be presented by such
beneficiary in case of any drawing thereunder; and (G) such other matters as the

 

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Administrative Agent or LC Issuer may require. In the case of a request for an
amendment of any outstanding Letter of Credit, such Letter of Credit Application
shall specify in form and detail satisfactory to the Administrative Agent and
the LC Issuer (A) the Letter of Credit to be amended; (B) the proposed date of
amendment thereof (which shall be a Business Day); (C) the nature of the
proposed amendment; and (D) such other matters as the Administrative Agent or
the LC Issuer may require. Additionally, the Lead Borrower shall furnish to the
LC Issuer and the Administrative Agent such other documents and information
pertaining to such requested Letter of Credit issuance or amendment, and any
Issuer Documents (including, if requested by the LC Issuer, a Standby Letter of
Credit Agreement or Commercial Letter of Credit Agreement, as applicable), as
the LC Issuer or the Administrative Agent may require.

(ii) Promptly after receipt of any Letter of Credit Application, the LC Issuer
will confirm with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has received a copy of such Letter of Credit Application
from the Lead Borrower and, if not, the LC Issuer will provide the
Administrative Agent with a copy thereof. Unless the LC Issuer has received
written notice from any Lender, the Administrative Agent or any Loan Party, at
least one Business Day prior to the requested date of issuance or amendment of
the applicable Letter of Credit, that one or more applicable conditions
contained in Article IV shall not then be satisfied, then, subject to the terms
and conditions hereof, the LC Issuer shall, on the requested date, issue a
Letter of Credit for the account of the applicable Borrower or enter into the
applicable amendment, in each case in accordance with the LC Issuer's usual and
customary business practices. Immediately upon the issuance or amendment of each
Letter of Credit, each Lender shall be deemed to (without any further action),
and hereby irrevocably and unconditionally agrees to, purchase from the LC
Issuer, without recourse or warranty, a risk participation in such Letter of
Credit in an amount equal to the product of such Lender’s Applicable Percentage
times the Stated Amount of such Letter of Credit. Upon any change in the
Commitments under this Agreement, it is hereby agreed that with respect to all
LC Obligations, there shall be an automatic adjustment to the participations
hereby created to reflect the new Applicable Percentages of the assigning and
assignee Lenders.

(iii) If the Lead Borrower so requests in any applicable Letter of Credit
Application, the LC Issuer may, in its sole and absolute discretion, agree to
issue a Standby Letter of Credit that has automatic extension provisions (each,
an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension
Letter of Credit must permit the LC Issuer 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
not later than a day (the “Non-Extension Notice Date”) in each such twelve-month
period to be agreed upon at the time such Standby Letter of Credit is issued.
Unless otherwise directed by the Administrative Agent or the LC Issuer, the Lead
Borrower shall not be required to make a specific request to the Administrative
Agent or the LC Issuer for any such extension. Once an Auto-Extension Letter of
Credit has been issued, the Lenders shall be deemed to have authorized (but may
not require) the LC Issuer to permit the extension of such Standby Letter of
Credit at any time to an expiry date not later than the Letter of Credit
Expiration Date; provided, however, that the Administrative Agent shall instruct
the LC Issuer not to permit any such extension if (A) the LC Issuer has
determined that it would not be permitted, or would have no obligation, at such
time to issue such Standby Letter of Credit in its revised form (as extended)
under the terms hereof (by reason of the provisions of clause (ii) or (iii) of
Section 2.03(a) or otherwise), or (B) the LC Issuer has received notice (which
may be by telephone or in writing) on or before the day that is five Business
Days before the Non-Extension Notice Date (1) from the Administrative Agent that
the Required Lenders have elected not to permit such extension or (2) from the
Administrative Agent, any Lender or the Lead Borrower that one or more of the
applicable conditions specified in Section 4.02 is not then satisfied, and in
each such case directing the LC Issuer not to permit such extension.

 

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(iv) Promptly after its delivery of any Letter of Credit or any amendment to a
Letter of Credit to an advising bank with respect thereto or to the beneficiary
thereof, the LC Issuer will also deliver to the Lead Borrower and the
Administrative Agent a true and complete copy of such Letter of Credit or
amendment.

(c) Drawings and Reimbursements; Funding of Participations.

(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a
drawing under such Letter of Credit, the LC Issuer shall notify the Lead
Borrower and the Administrative Agent thereof not less than two (2) Business
Days prior to the Honor Date (as defined below); provided, however, that any
failure to give or delay in giving such notice shall not relieve the Borrowers
of their obligation to reimburse the LC Issuer and the Lenders with respect to
any such payment. On the date of any payment by the LC Issuer under a Letter of
Credit (each such date, an “Honor Date”), the Borrowers shall be deemed to have
requested a Committed Borrowing of Base Rate Loans to be disbursed on the Honor
Date in an amount equal to the amount of such payment, without regard to the
minimum and multiples specified in Section 2.02(b) for the principal amount of
Base Rate Loans, and without regard to whether the conditions set forth in
Section 4.02 have been met. Any notice given by the LC Issuer or the
Administrative Agent pursuant to this Section 2.03(c)(i) may be given by
telephone if immediately confirmed in writing; provided that the lack of such an
immediate confirmation shall not affect the conclusiveness or binding effect of
such notice.

(ii) Each Lender’s obligation to make Committed Loans or LC Advances to
reimburse the LC Issuer for amounts drawn under Letters of Credit, as
contemplated by this Section 2.03(c), shall be absolute and unconditional and
shall not be affected by any circumstance, including (A) any setoff,
counterclaim, recoupment, defense or other right which such Lender may have
against the LC Issuer, any Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default, or (C) any other
occurrence, event or condition, whether or not similar to any of the foregoing,
and without regard to whether the conditions set forth in Section 4.02 have been
met.

(d) Repayment of Participations. If any payment received by the LC Issuer
pursuant to Section 2.03(c)(i) is required to be returned under any of the
circumstances described in Section 10.05 (including pursuant to any settlement
entered into by the LC Issuer in its discretion), each Lender shall pay to the
Administrative Agent for the account of the LC Issuer its Applicable Percentage
thereof on demand of the Administrative Agent, plus interest thereon from the
date of such demand to the date such amount is returned by such Lender, at a
rate per annum equal to the Federal Funds Rate from time to time in effect. The
obligations of the Lenders under this clause shall survive the payment in full
of the Obligations and the termination of this Agreement.

(e) Obligations Absolute. The obligation of the Borrowers to reimburse the LC
Issuer for each drawing under each Letter of Credit shall be absolute,
unconditional and irrevocable, and shall be paid strictly in accordance with the
terms of this Agreement under all circumstances, including the following:

(i) any lack of validity or enforceability of such Letter of Credit, this
Agreement, or any other Loan Document;

(ii) the existence of any claim, counterclaim, setoff, defense or other right
that the Borrowers or any Subsidiary may have at any time against any
beneficiary or any transferee of such Letter of Credit (or any Person for whom
any such beneficiary or any such transferee may be acting), the LC Issuer or any
other Person, whether in connection with this Agreement, the transactions
contemplated hereby or by such Letter of Credit or any agreement or instrument
relating thereto, or any unrelated transaction;

 

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(iii) any draft, demand, certificate or other document presented under such
Letter of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any respect;
or any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under such Letter of Credit;

(iv) any payment by the LC Issuer under such Letter of Credit against
presentation of a draft or certificate that does not strictly comply with the
terms of such Letter of Credit; or any payment made by the LC Issuer under such
Letter of Credit to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or any
transferee of such Letter of Credit, including any arising in connection with
any proceeding under any Debtor Relief Law;

(v) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing, including any other circumstance that might otherwise
constitute a defense available to, or a discharge of, the Borrowers or any of
their Subsidiaries; or

(vi) the fact that any Event of Default shall have occurred and be continuing.

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

(f) Role of LC Issuer. Each Lender and the Borrowers agree that, in paying any
drawing under a Letter of Credit, the LC Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. None of the LC Issuer, the
Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the LC Issuer shall be liable to any
Lender for (i) any action taken or omitted in connection herewith at the request
or with the approval of the Lenders or the Required Lenders, as applicable;
(ii) any action taken or omitted in the absence of gross negligence or willful
misconduct; (iii) 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 or any error in interpretation of technical
terms; or (iv) the due execution, effectiveness, validity or enforceability of
any document or instrument related to any Letter of Credit or Issuer Document.
The Borrowers hereby assume all risks of the acts or omissions of any
beneficiary or transferee with respect to its use of any Letter of Credit;
provided, that, this assumption is not intended to, and shall not, preclude the
Borrowers’ pursuing such rights and remedies as it may have against the
beneficiary or transferee at law or under any other agreement. None of the LC
Issuer, the Administrative Agent, any of their respective Related Parties nor
any correspondent, participant or assignee of the LC Issuer shall be liable or
responsible for any of the matters described in clauses (i) through (v) of
Section 2.03(e) or for any action, neglect or omission under or in connection
with any Letter of Credit or Issuer Documents, including, without limitation,
the issuance or any amendment of any Letter of Credit, the failure to issue or
amend any Letter of Credit, or the honoring or dishonoring of any demand under
any Letter of Credit, and such action or neglect or omission will bind the
Borrowers; provided, that, anything in such clauses to the contrary
notwithstanding, the Borrowers may have a claim against the LC Issuer, and the
LC Issuer may be liable to the Borrowers, to the extent, but only to the extent,
of any direct, as opposed to

 

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consequential, exemplary or punitive damages suffered by the Borrowers which the
Borrowers prove were caused by the LC Issuer's willful misconduct or gross
negligence or the LC Issuer's willful failure to pay under any Letter of Credit
after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit; provided further, however, that any claim against the LC Issuer by the
Borrowers for any loss suffered or incurred by the Borrowers shall be reduced by
an amount equal to the sum of (i) the amount (if any) saved by the Borrowers as
a result of the breach or other wrongful conduct that allegedly caused such
loss, and (ii) the amount (if any) of the loss that would have been avoided had
the Borrowers taken all reasonable steps to mitigate such loss, including,
without limitation, by enforcing their rights against any beneficiary and, in
case of a claim of wrongful dishonor, by specifically and timely authorizing the
LC Issuer to cure such dishonor. In furtherance and not in limitation of the
foregoing, the LC Issuer may accept documents that appear on their face to be in
order, without responsibility for further investigation, regardless of any
notice or information to the contrary (or the LC Issuer may 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 and may disregard any requirement in a
Letter of Credit that notice of dishonor be given in a particular manner and any
requirement that presentation be made at a particular place or by a particular
time of day), and the LC Issuer shall not be responsible for the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign a Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason. The LC Issuer shall not be responsible for the
wording of any Letter of Credit (including, without limitation, any drawing
conditions or any terms or conditions that are ineffective, ambiguous,
inconsistent, unduly complicated or reasonably impossible to satisfy),
notwithstanding any assistance the LC Issuer may provide to the Borrowers with
drafting or recommending text for any Letter of Credit Application or with the
structuring of any transaction related to any Letter or Credit, and the
Borrowers hereby acknowledge and agree that any such assistance will not
constitute legal or other advice by the LC Issuer or any representation or
warranty by the LC Issuer that any such wording or such Letter of Credit will be
effective. Without limiting the foregoing, the LC Issuer may, as it deems
appropriate, modify or alter and use in any Letter of Credit the terminology
contained on the Letter of Credit Application for such Letter of Credit.

(g) Cash Collateral.

(i) Upon the request of the Administrative Agent, (A) if the LC Issuer has
honored any full or partial drawing request under any Letter of Credit and such
drawing has resulted in an LC Obligation that remains outstanding, or (B) if, as
of the Letter of Credit Expiration Date, any LC Obligation for any reason
remains outstanding, the Borrowers shall, in each case, immediately Cash
Collateralize the then Outstanding Amount of all LC Obligations. Sections 2.05
and 8.02(c) set forth certain additional requirements to deliver Cash Collateral
hereunder. For purposes of this Section 2.03, Section 2.05 and Section 8.02(c),
“Cash Collateralize” means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the LC Issuer and the Lenders, as
collateral for the LC Obligations, cash or deposit account balances in an amount
equal to one hundred five percent (105%) of the Outstanding Amount of all LC
Obligations (other than LC Obligations with respect to Letters of Credit
denominated in a currency other than Dollars, which LC Obligations shall be Cash
Collateralized in an amount equal to one hundred fifteen percent (115%) of the
Outstanding Amount of such LC Obligations), pursuant to documentation in form
and substance satisfactory to the Administrative Agent and the LC Issuer (which
documents are hereby Consented to by the Lenders). The Borrowers hereby grant to
the Administrative Agent a security interest in all such cash, deposit accounts
and all balances therein and all proceeds of the foregoing. Cash Collateral
shall be maintained in blocked, non-interest bearing deposit accounts at Wells
Fargo.

(ii) If at any time the Administrative Agent determines that any funds held as
Cash Collateral are subject to any right or claim of any Person other than the
Administrative Agent or that

 

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the total amount of such funds is less than the aggregate Outstanding Amount of
all LC Obligations, the Borrowers will, forthwith upon demand by the
Administrative Agent, pay to the Administrative Agent, as additional funds to be
deposited as Cash Collateral, an amount equal to the excess of (x) such
aggregate Outstanding Amount over (y) the total amount of funds, if any, then
held as Cash Collateral that the Administrative Agent determines to be free and
clear of any such right and claim. Upon the drawing of any Letter of Credit for
which funds are on deposit as Cash Collateral, such funds shall be applied, to
the extent permitted under applicable Laws, to reimburse the LC Issuer and, to
the extent not so applied, shall thereafter be applied to satisfy other
Obligations.

(h) Applicability of ISP and UCP 600. Unless otherwise expressly agreed by the
LC Issuer and the Lead Borrower when a Letter of Credit is issued (including any
such agreement applicable to an Existing Letter of Credit), (i) the rules of the
ISP and UCP 600 shall apply to each Standby Letter of Credit, and (ii) the rules
of the UCP 600 shall apply to each Commercial Letter of Credit.

(i) Letter of Credit Fees. The Borrowers shall pay to the Administrative Agent
for the account of each Lender in accordance with its Applicable Percentage a
Letter of Credit fee (the “Letter of Credit Fee”) for each Standby Letter of
Credit and Commercial Letter of Credit equal to the Applicable LC Fee Rate times
the daily Stated Amount under each such Letter of Credit (whether or not such
maximum amount is then in effect under such Letter of Credit). For purposes of
computing the daily amount available to be drawn under any Letter of Credit, the
amount of the Letter of Credit shall be determined in accordance with
Section 1.06. Letter of Credit Fees shall be (i) due and payable on the first
day after the end of each month commencing with the first such date to occur
after the issuance of such Letter of Credit, on the Letter of Credit Expiration
Date and thereafter on demand, and (ii) computed on a monthly basis in arrears.
If there is any change in the Applicable LC Fee Rate during any quarter, the
daily amount available to be drawn under of each Letter of Credit shall be
computed and multiplied by the Applicable LC Fee Rate separately for each period
during such quarter that such Applicable LC Fee Rate was in effect.
Notwithstanding anything to the contrary contained herein, while any Event of
Default exists, all Letter of Credit Fees shall accrue at the Default Rate as
provided in Section 2.08(b) hereof.

(j) Fronting Fee and Documentary and Processing Charges Payable to LC Issuer.
The Borrowers shall pay directly to the LC Issuer, for its own account, a
fronting fee (the “Fronting Fee”) (i) with respect to each Commercial Letter of
Credit, at a rate equal to 0.125% per annum, computed on the amount of such
Letter of Credit, and payable upon the issuance or amendment thereof, and
(ii) with respect to each Standby Letter of Credit, at a rate equal to
0.125% per annum, computed on the daily amount available to be drawn under such
Letter of Credit and on a monthly basis in arrears. Such Fronting Fees shall be
due and payable on the first day after the end of each month, commencing with
the first such date to occur after the issuance of such Letter of Credit, on the
Letter of Credit Expiration Date and thereafter on demand. For purposes of
computing the daily amount available to be drawn under any Letter of Credit, the
amount of the Letter of Credit shall be determined in accordance with
Section 1.06. In addition, the Borrowers shall pay directly to the LC Issuer,
for its own account, the customary issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of the LC Issuer relating
to letters of credit as from time to time in effect. Such customary fees and
standard costs and charges are due and payable on demand and are nonrefundable.

(k) Conflict with Issuer Documents. In the event of any conflict between the
terms hereof and the terms of any Issuer Document, the terms hereof shall
control.

2.04. Swing Line Loans.

(a) The Swing Line. Subject to the terms and conditions set forth herein, the
Swing Line Lender may, in reliance upon the agreements of the other Lenders set
forth in this Section 2.04,

 

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make loans (each such loan, a “Swing Line Loan”) to the Borrowers from time to
time on any Business Day during the Availability Period in an aggregate amount
not to exceed at any time outstanding the amount of the Swing Line Sublimit,
notwithstanding the fact that such Swing Line Loans, when aggregated with the
Applicable Percentage of the Outstanding Amount of Committed Loans and LC
Obligations of the Lender acting as Swing Line Lender, may exceed the amount of
such Lender’s Commitment; provided, that, after giving effect to any Swing Line
Loan, (i) the Total Outstandings shall not exceed Loan Cap, and (ii) the
aggregate Outstanding Amount of the Committed Loans of any Lender at such time,
plus such Lender’s Applicable Percentage of the Outstanding Amount of all LC
Obligations at such time, plus such Lender’s Applicable Percentage of the
Outstanding Amount of all Swing Line Loans at such time shall not exceed such
Lender’s Commitment, and provided, that, the Borrowers shall not use the
proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan,
and provided that, the Swing Line Lender shall not be obligated to make any
Swing Line Loan at any time when any Lender is at such time a Defaulting Lender
or Deteriorating Lender hereunder, unless the Swing Line Lender has entered into
satisfactory arrangements with the Borrower or such Lender to eliminate the
Swing Line Lender’s risk with respect to such Lender. Within the foregoing
limits, and subject to the other terms and conditions hereof, the Borrowers may
borrow under this Section 2.04, prepay under Section 2.05, and reborrow under
this Section 2.04. Each Swing Line Loan shall bear interest only at a rate based
on the Base Rate. Immediately upon the making of a Swing Line Loan, each Lender
shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the Swing Line Lender a risk participation in such Swing Line Loan
in an amount equal to the product of such Lender’s Applicable Percentage times
the amount of such Swing Line Loan. The Swing Line Lender shall have all of the
benefits and immunities (A) provided to the Administrative Agent in Article IX
with respect to any acts taken or omissions suffered by the Swing Line Lender in
connection with Swing Line Loans made by it or proposed to be made by it as if
the term “Administrative Agent” as used in Article IX included the Swing Line
Lender with respect to such acts or omissions, and (B) as additionally provided
herein with respect to the Swing Line Lender.

(b) Borrowing Procedures. Each Swing Line Borrowing shall be made upon the Lead
Borrower’s irrevocable notice to the Swing Line Lender and the Administrative
Agent, which may be given by telephone. Each such notice must be received by the
Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the
requested borrowing date, and shall specify (i) the amount to be borrowed, which
shall be a minimum of $50,000, and (ii) the requested borrowing date, which
shall be a Business Day. Each such telephonic notice must be confirmed promptly
by delivery to the Swing Line Lender and the Administrative Agent of a written
Swing Line Loan Notice, appropriately completed and signed by a Responsible
Officer of the Lead Borrower. Promptly after receipt by the Swing Line Lender of
any telephonic Swing Line Loan Notice, the Swing Line Lender will confirm with
the Administrative Agent (by telephone or in writing) that the Administrative
Agent has also received such Swing Line Loan Notice and, if not, the Swing Line
Lender will notify the Administrative Agent (by telephone or in writing) of the
contents thereof. Unless the Swing Line Lender has received notice (by telephone
or in writing) from the Administrative Agent at the request of the Required
Lenders prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing
(A) directing the Swing Line Lender not to make such Swing Line Loan as a result
of the limitations set forth in the proviso to the first sentence of
Section 2.04(a), or (B) that one or more of the applicable conditions specified
in Article IV is not then satisfied, then, subject to the terms and conditions
hereof, the Swing Line Lender may, not later than 3:00 p.m. on the borrowing
date specified in such Swing Line Loan Notice, make the amount of its Swing Line
Loan available to the Borrowers at its office by crediting the account of the
Lead Borrower on the books of the Swing Line Lender in immediately available
funds.

 

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(c) Refinancing of Swing Line Loans.

(i) The Swing Line Lender at any time in its sole and absolute discretion may
request, on behalf of the Borrowers (which hereby irrevocably authorize the
Swing Line Lender to so request on their behalf), that each Lender make a Base
Rate Loan in an amount equal to such Lender's Applicable Percentage of the
amount of Swing Line Loans then outstanding. Such request shall be made in
writing (which written request shall be deemed to be a Committed Loan Notice for
purposes hereof) and in accordance with the requirements of Section 2.02,
without regard to the minimum and multiples specified therein for the principal
amount of Base Rate Loans, but subject to the unutilized portion of the
Aggregate Commitments and the conditions set forth in Section 4.02. The Swing
Line Lender shall furnish the Lead Borrower with a copy of the applicable
Committed Loan Notice promptly after delivering such notice to the
Administrative Agent. Each Lender shall make an amount equal to its Applicable
Percentage of the amount specified in such Committed Loan Notice available to
the Administrative Agent in immediately available funds for the account of the
Swing Line Lender at the Administrative Agent’s Office not later than 1:00 p.m.
on the day specified in such Committed Loan Notice, whereupon, subject to
Section 2.04(c)(ii), each Lender that so makes funds available shall be deemed
to have made a Base Rate Loan to the Borrowers in such amount. The
Administrative Agent shall remit the funds so received to the Swing Line Lender.

(ii) If for any reason any Swing Line Loan cannot be refinanced by such a
Committed Borrowing in accordance with Section 2.04(c)(i), the request for Base
Rate Loans submitted by the Swing Line Lender as set forth herein shall be
deemed to be a request by the Swing Line Lender that each of the Lenders fund
its risk participation in the relevant Swing Line Loan and each Lender’s payment
to the Administrative Agent for the account of the Swing Line Lender pursuant to
Section 2.04(c)(i) shall be deemed payment in respect of such participation.

(iii) If any Lender fails to make available to the Administrative Agent for the
account of the Swing Line Lender any amount required to be paid by such Lender
pursuant to the foregoing provisions of this Section 2.04(c) by the time
specified in Section 2.04(c)(i), the Swing Line Lender shall be entitled to
recover from such Lender (acting through the Administrative Agent), on demand,
such amount with interest thereon for the period from the date such payment is
required to the date on which such payment is immediately available to the Swing
Line Lender at a rate per annum equal to the greater of the Federal Funds Rate
and a rate determined by the Swing Line Lender in accordance with banking
industry rules on interbank compensation plus any administrative, processing or
similar fees customarily charged by the Swing Line Lender in connection with the
foregoing. If such Lender pays such amount (with interest and fees as
aforesaid), the amount so paid shall constitute such Lender’s Committed Loan
included in the relevant Committed Borrowing or funded participation in the
relevant Swing Line Loan, as the case may be. A certificate of the Swing Line
Lender submitted to any Lender (through the Administrative Agent) with respect
to any amounts owing under this clause (iii) shall be conclusive absent manifest
error.

(iv) Each Lender’s obligation to make Committed Loans or to purchase and fund
risk participations in Swing Line Loans pursuant to this Section 2.04(c) shall
be absolute and unconditional and shall not be affected by any circumstance,
including (A) any setoff, counterclaim, recoupment, defense or other right which
such Lender may have against the Swing Line Lender, the Borrowers or any other
Person for any reason whatsoever, (B) the occurrence or continuance of a
Default, or (C) any other occurrence, event or condition, whether or not similar
to any of the foregoing; provided, that, each Lender’s obligation to make
Committed Loans pursuant to this Section 2.04(c) is subject to the conditions
set forth in Section 4.02. No such funding of risk participations shall relieve
or otherwise impair the obligation of the Borrowers to repay Swing Line Loans,
together with interest as provided herein.

 

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(d) Repayment of Participations.

(i) At any time after any Lender has purchased and funded a risk participation
in a Swing Line Loan, if the Swing Line Lender receives any payment on account
of such Swing Line Loan, the Swing Line Lender will distribute to such Lender
its Applicable Percentage of such payment (appropriately adjusted, in the case
of interest payments, to reflect the period of time during which such Lender’s
risk participation was funded) in the same funds as those received by the Swing
Line Lender.

(ii) If any payment received by the Swing Line Lender in respect of principal or
interest on any Swing Line Loan is required to be returned by the Swing Line
Lender under any of the circumstances described in Section 10.05 (including
pursuant to any settlement entered into by the Swing Line Lender in its
discretion), each Lender shall pay to the Swing Line Lender its Applicable
Percentage thereof on demand of the Administrative Agent, plus interest thereon
from the date of such demand to the date such amount is returned, at a rate per
annum equal to the Federal Funds Rate. The Administrative Agent will make such
demand upon the request of the Swing Line Lender. The obligations of the Lenders
under this clause shall survive the payment in full of the Obligations and the
termination of this Agreement.

(e) Interest for Account of Swing Line Lender. The Swing Line Lender shall be
responsible for invoicing the Borrowers for interest on the Swing Line Loans.
Until each Lender funds its Base Rate Loan or risk participation pursuant to
this Section 2.04 to refinance such Lender’s Applicable Percentage of any Swing
Line Loan, interest in respect of such Applicable Percentage shall be solely for
the account of the Swing Line Lender.

(f) Payments Directly to Swing Line Lender. The Borrowers shall make all
payments of principal and interest in respect of the Swing Line Loans directly
to the Swing Line Lender.

2.05. Prepayments.

(a) The Borrowers may, upon irrevocable notice from the Lead Borrower to the
Administrative Agent, at any time or from time to time voluntarily prepay
Committed Loans in whole or in part without premium or penalty; provided that
(i) such notice must be received by the Administrative Agent not later than
11:00 a.m. (A) three Business Days prior to any date of prepayment of LIBO Rate
Loans and (B) on the date of prepayment of Base Rate Loans; (ii) any prepayment
of LIBO Rate Loans shall be in a principal amount of $1,000,000 or a whole
multiple of $500,000 in excess thereof; and (iii) any prepayment of Base Rate
Loans shall be in a principal amount of $50,000 or a whole multiple of $10,000
in excess thereof or, in each case, if less, the entire principal amount thereof
then outstanding. Each such notice shall specify the date and amount of such
prepayment and the Type(s) of Loans to be prepaid and, if LIBO Rate Loans, the
Interest Period(s) of such Loans. The Administrative Agent will promptly notify
each Lender of its receipt of each such notice, and of the amount of such
Lender’s Applicable Percentage of such prepayment. If such notice is given by
the Lead Borrower, the Borrowers shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein. Any prepayment of a LIBO Rate Loan shall be accompanied by all accrued
interest on the amount prepaid, together with any additional amounts required
pursuant to Section 3.05. Each such prepayment shall be applied to the Committed
Loans of the Lenders in accordance with their respective Applicable Percentages.
If the Borrowers shall fail to specify a voluntary prepayment as to the Loans
then such prepayment shall be applied first to Base Rate Loans and second to
LIBO Rate Loans in direct order of Interest Payment Dates.

(b) The Borrowers may, upon irrevocable notice from the Lead Borrower to the
Swing Line Lender (with a copy to the Administrative Agent), at any time or from
time to time, voluntarily prepay Swing Line Loans in whole or in part without
premium or penalty; provided that, (i)

 

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such notice must be received by the Swing Line Lender and the Administrative
Agent not later than 1:00 p.m. on the date of the prepayment, and (ii) any such
prepayment shall be in a minimum principal amount of $50,000. Each such notice
shall specify the date and amount of such prepayment. If such notice is given by
the Lead Borrower, the Borrowers shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein.

(c) If for any reason the Total Outstandings at any time exceed the Loan Cap as
then in effect, the Borrowers shall immediately prepay Loans and/or Cash
Collateralize the LC Obligations in an aggregate amount equal to such excess;
provided, however, that the Borrowers shall not be required to Cash
Collateralize the LC Obligations pursuant to this Section 2.05(c) unless after
the prepayment in full of the Loans the Total Outstandings exceed the Loan Cap
as then in effect.

(d) The Borrowers shall prepay the Loans and Cash Collateralize the LC
Obligations to the extent required by the provisions of Section 6.13 hereof.

(e) The Borrowers shall prepay the Loans and Cash Collateralize the LC
Obligations in an amount equal to the Net Proceeds received by a Loan Party on
account of a Prepayment Event, irrespective of whether a Cash Dominion Event
then exists and is continuing.

(f) Prepayments made pursuant to Section 2.05(c), (d) and (e) above, first,
shall be applied to the Swing Line Loans, second, shall be applied ratably to
the outstanding Committed Loans, third, shall be used to Cash Collateralize the
remaining LC Obligations; and, fourth, the amount remaining, if any, after the
prepayment in full of all Swing Line Loans and Committed Loans outstanding at
such time and the Cash Collateralization of the remaining LC Obligations in full
may be retained by the Borrowers for use in the ordinary course of its business.
Upon the drawing of any Letter of Credit that has been Cash Collateralized, the
funds held as Cash Collateral shall be applied (without any further action by or
notice to or from the Borrowers or any other Loan Party) to reimburse the LC
Issuer or the Lenders, as applicable.

2.06. Termination or Reduction of Commitments. (a) The Borrowers may, upon
irrevocable notice from the Lead Borrower to the Administrative Agent, terminate
the Aggregate Commitments, the Letter of Credit Sublimit or the Swing Line
Sublimit or from time to time permanently reduce the Aggregate Commitments, the
Letter of Credit Sublimit or the Swing Line Sublimit; provided that (i) any such
notice shall be received by the Administrative Agent not later than 11:00 a.m.
five Business Days prior to the date of termination or reduction, (ii) any such
partial reduction of the Aggregate Commitments, the Letter of Credit Sublimit or
the Swing Line Sublimit shall be in an aggregate amount of $10,000,000 or any
whole multiple of $1,000,000 in excess thereof, (iii) the Borrowers shall not
terminate or reduce (A) the Aggregate Commitments if, after giving effect
thereto and to any concurrent prepayments hereunder, the Total Outstandings
would exceed the Aggregate Commitments, (B) the Letter of Credit Sublimit if,
after giving effect thereto, the Outstanding Amount of LC Obligations not fully
Cash Collateralized hereunder would exceed the Letter of Credit Sublimit, and
(C) the Swing Line Sublimit if, after giving effect thereto, and to any
concurrent payments hereunder, the Outstanding Amount of Swing Line Loans
hereunder would exceed the Swing Line Sublimit.

(b) If, after giving effect to any reduction of the Aggregate Commitments, the
Letter of Credit Sublimit or the Swing Line Sublimit exceeds the amount of the
Aggregate Commitments, such Letter of Credit Sublimit or Swing Line Sublimit
shall be automatically reduced by the amount of such excess.

(c) The Administrative Agent will promptly notify the Lenders of any termination
or reduction of the Letter of Credit Sublimit, Swing Line Sublimit or the
Aggregate Commitments under this

 

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Section 2.06. Upon any reduction of the Aggregate Commitments, the Commitment of
each Lender shall be reduced by such Lender’s Applicable Percentage of such
reduction amount. All fees (including, without limitation, commitment fees,
Early Termination Fees, and Letter of Credit Fees) and interest in respect of
the Aggregate Commitments accrued until the effective date of any termination of
the Aggregate Commitments shall be paid on the effective date of such
termination.

2.07. Repayment of Loans.

(a) The Borrowers shall repay to the Lenders on the Termination Date the
aggregate principal amount of Committed Loans outstanding on such date.

(b) To the extent not previously paid, the Borrowers shall repay the outstanding
balance of the Swing Line Loans on the Termination Date.

2.08. Interest.

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

(b) (i) If any amount payable under any Loan Document is not paid when due
(without regard to any applicable grace periods), whether at stated maturity, by
acceleration or otherwise, such amount shall thereafter bear interest at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.

(ii) If any other Event of Default exists, then the Administrative Agent may,
and upon the request of the Required Lenders shall, notify the Lead Borrower
that all outstanding Obligations shall thereafter bear interest at a fluctuating
interest rate per annum at all times equal to the Default Rate and thereafter
such Obligations shall bear interest at the Default Rate to the fullest extent
permitted by applicable Laws.

(iii) Accrued and unpaid interest on past due amounts (including interest on
past due interest) shall be due and payable upon demand.

(c) Interest on each Loan shall be due and payable in arrears on each Interest
Payment Date applicable thereto and at such other times as may be specified
herein. Interest hereunder shall be due and payable in accordance with the terms
hereof before and after judgment, and before and after the commencement of any
proceeding under any Debtor Relief Law.

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

(a) Commitment Fee. The Borrowers shall pay to the Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage, a
commitment fee equal to the Applicable Commitment Fee Percentage times the
actual daily amount by which the Aggregate Commitments exceed the Total
Outstandings. The commitment fee shall accrue at all times during the
Availability Period, including at any time during which one or more of the
conditions in Article IV is not met, and shall be due and payable (i) quarterly
in arrears on the first day after the end of each quarter,

 

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commencing with the first such date to occur after the Closing Date, so long as
no Cash Dominion Event shall have occurred and be continuing, (ii) monthly in
arrears on the first day after the end of each month, following the occurrence
and during the continuance of a Cash Dominion Event, and (iii) on the last day
of the Availability Period. The commitment fee shall be calculated quarterly in
arrears

(b) Other Fees. The Borrowers shall pay to the Arranger and the Administrative
Agent for their own respective accounts fees in the amounts and at the times
specified in the Fee Letter. Such fees shall be fully earned when paid and shall
not be refundable for any reason whatsoever.

2.10. Computation of Interest and Fees. All computations of fees and interest
shall be made on the basis of a 360-day year and actual days elapsed. Interest
shall accrue on each Loan for the day on which the Loan is made, and shall not
accrue on a Loan, or any portion thereof, for the day on which the Loan or such
portion is paid, provided that any Loan that is repaid on the same day on which
it is made shall, subject to Section 2.12(a), bear interest for one day. Each
determination by the Administrative Agent of an interest rate or fee hereunder
shall be conclusive and binding for all purposes, absent manifest error.

2.11. Evidence of Debt.

(a) The Credit Extensions made by each Lender shall be evidenced by one or more
accounts or records maintained by the Administrative Agent (the “Loan Account”)
in the ordinary course of business. In addition, each Lender may record in such
Lender’s internal records, an appropriate notation evidencing the date and
amount of each Loan from such Lender, each payment and prepayment of principal
of any such Loan, and each payment of interest, fees and other amounts due in
connection with the Obligations due to such Lender. The accounts or records
maintained by the Administrative Agent and each Lender shall be conclusive
absent manifest error of the amount of the Credit Extensions made by the Lenders
to the Borrowers and the interest and payments thereon. Any failure to so record
or any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrowers hereunder to pay any amount owing with respect to
the Obligations. In the event of any conflict between the accounts and records
maintained by any Lender and the accounts and records of the Administrative
Agent in respect of such matters, the accounts and records of the Administrative
Agent shall control in the absence of manifest error. Upon the request of any
Lender made through the Administrative Agent, the Borrowers shall execute and
deliver to such Lender (through the Administrative Agent) a Note, which shall
evidence such Lender’s Loans in addition to such accounts or records. Each
Lender may attach schedules to its Note and endorse thereon the date, Type (if
applicable), amount and maturity of its Loans and payments with respect thereto.
Upon receipt of an affidavit of a Lender as to the loss, theft, destruction or
mutilation of such Lender’s Note and upon cancellation of such Note, the
Borrowers will issue, in lieu thereof, a replacement Note in favor of such
Lender, in the same principal amount thereof and otherwise of like tenor.

(b) In addition to the accounts and records referred to in Section 2.11(a), each
Lender and the Administrative Agent shall maintain in accordance with its usual
practice accounts or records evidencing the purchases and sales by such Lender
of participations in Letters of Credit and Swing Line Loans. In the event of any
conflict between the accounts and records maintained by the Administrative Agent
and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of
manifest error.

2.12. Payments Generally; the Administrative Agent’s Clawback.

(a) General. All payments to be made by the Borrowers shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise

 

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expressly provided herein, all payments by the Borrowers hereunder shall be made
to the Administrative Agent, for the account of the respective Lenders to which
such payment is owed, at the Administrative Agent’s Office in Dollars and in
immediately available funds not later than 2:00 p.m. on the date specified
herein. The Administrative Agent will promptly distribute to each Lender its
Applicable Percentage (or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender’s Lending
Office. All payments received by the Administrative Agent after 2:00 p.m., at
the option of the Administrative Agent, shall be deemed received on the next
succeeding Business Day and any applicable interest or fee shall continue to
accrue. If any payment to be made by the Borrowers shall come due on a day other
than a Business Day, payment shall be made on the next following Business Day,
and such extension of time shall be reflected in computing interest or fees, as
the case may be.

(b) (i) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing of LIBO Rate Loans (or in the case of any
Borrowing of Base Rate Loans, prior to 12:00 noon on the date of such Borrowing)
that such Lender will not make available to the Administrative Agent such
Lender’s share of such Borrowing, the Administrative Agent may assume that such
Lender has made such share available on such date in accordance with
Section 2.02 (or in the case of a Borrowing of Base Rate Loans, that such Lender
has made such share available in accordance with and at the time required by
Section 2.02) and may, in reliance upon such assumption, make available to the
Borrowers a corresponding amount. In such event, if a Lender has not in fact
made its share of the applicable Committed Borrowing available to the
Administrative Agent, then the applicable Lender and the Borrowers severally
agree to pay to the Administrative Agent forthwith on demand such corresponding
amount in immediately available funds with interest thereon, for each day from
and including the date such amount is made available to the Borrowers to but
excluding the date of payment to the Administrative Agent, at (A) in the case of
a payment to be made by such Lender, the greater of the Federal Funds Rate and a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation plus any administrative processing or similar
fees customarily charged by the Administrative Agent in connection with the
foregoing, and (B) in the case of a payment to be made by the Borrowers, the
interest rate applicable to Base Rate Loans. If the Borrowers and such Lender
shall pay such interest to the Administrative Agent for the same or an
overlapping period, the Administrative Agent shall promptly remit to the
Borrowers the amount of such interest paid by the Borrowers for such period. If
such Lender pays its share of the applicable Committed Borrowing to the
Administrative Agent, then the amount so paid shall constitute such Lender’s
Committed Loan included in such Committed Borrowing. Any payment by the
Borrowers shall be without prejudice to any claim the Borrowers may have against
a Lender that shall have failed to make such payment to the Administrative
Agent.

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

 

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

(c) Failure to Satisfy Conditions Precedent. If any Lender makes available to
the Administrative Agent funds for any Loan to be made by such Lender as
provided in the foregoing provisions of this Article II, and such funds are not
made available to the Borrowers by the Administrative Agent because the
conditions to the applicable Credit Extension set forth in Article IV are not
satisfied or waived in accordance with the terms hereof (subject to the
provisions of the last paragraph of Section 4.02 hereof), the Administrative
Agent shall return such funds (in like funds as received from such Lender) to
such Lender, without interest.

(d) Obligations of Lenders Several. The obligations of the Lenders hereunder to
make Committed Loans, to fund participations in Letters of Credit and Swing Line
Loans and to make payments hereunder are several and not joint. The failure of
any Lender to make any Committed Loan, to fund any such participation or to make
any payment hereunder on any date required hereunder shall not relieve any other
Lender of its corresponding obligation to do so on such date, and no Lender
shall be responsible for the failure of any other Lender to so make its
Committed Loan, to purchase its participation or to make its payment hereunder.

(e) Funding Source. Nothing herein shall be deemed to obligate any Lender to
obtain the funds for any Loan in any particular place or manner or to constitute
a representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.

2.13. Sharing of Payments by Lenders. If any Credit Party shall, by exercising
any right of setoff or counterclaim or otherwise, obtain payment in respect of
any principal of, interest on, or other amounts with respect to, any of the
Obligations resulting in such Lender’s receiving payment of a proportion of the
aggregate amount of such Obligations greater than its pro rata share thereof as
provided herein (including as in contravention of the priorities of payment set
forth in Section 8.03), then the Credit Party receiving such greater proportion
shall (a) notify the Administrative Agent of such fact, and (b) purchase (for
cash at face value) participations in the Obligations of the other Credit
Parties, or make such other adjustments as shall be equitable, so that the
benefit of all such payments shall be shared by the Credit Parties ratably and
in the priorities set forth in Section 8.03, provided that:

(i) if any such participations or subparticipations are purchased and all or any
portion of the payment giving rise thereto is recovered, such participations or
subparticipations shall be rescinded and the purchase price restored to the
extent of such recovery, without interest; and

(ii) the provisions of this Section shall not be construed to apply to (x) any
payment made by the Loan Parties pursuant to and in accordance with the express
terms of this Agreement or (y) any payment obtained by a Lender as consideration
for the assignment of or sale of a participation in any of its Committed Loans
or subparticipations in LC Obligations or Swing Line Loans to any assignee or
participant, other than to the Borrowers or any Subsidiary thereof (as to which
the provisions of this Section shall apply).

Each Loan Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against such
Loan Party rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of such Loan Party in the
amount of such participation.

 

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2.14. Settlement Amongst Lenders

(a) The amount of each Lender’s Applicable Percentage of outstanding Loans
(including outstanding Swing Line Loans) shall be computed weekly (or more
frequently in the Administrative Agent’s discretion) and shall be adjusted
upward or downward based on all Loans (including Swing Line Loans) and
repayments of Loans (including Swing Line Loans) received by the Administrative
Agent as of 3:00 p.m. on the first Business Day (such date, the “Settlement
Date”) following the end of the period specified by the Administrative Agent.

(b) The Administrative Agent shall deliver to each of the Lenders promptly after
a Settlement Date a summary statement of the amount of outstanding Committed
Loans and Swing Line Loans for the period and the amount of repayments received
for the period. As reflected on the summary statement, (i) the Administrative
Agent shall transfer to each Lender its Applicable Percentage of repayments, and
(ii) each Lender shall transfer to the Administrative Agent (as provided below)
or the Administrative Agent shall transfer to each Lender, such amounts as are
necessary to insure that, after giving effect to all such transfers, the amount
of Committed Loans made by each Lender shall be equal to such Lender’s
Applicable Percentage of all Committed Loans outstanding as of such Settlement
Date. If the summary statement requires transfers to be made to the
Administrative Agent by the Lenders and is received prior to 1:00 p.m. on a
Business Day, such transfers shall be made in immediately available funds no
later than 3:00 p.m. that day; and, if received after 1:00 p.m., then no later
than 3:00 p.m. on the next Business Day. The obligation of each Lender to
transfer such funds is irrevocable, unconditional and without recourse to or
warranty by the Administrative Agent. If and to the extent any Lender shall not
have so made its transfer to the Administrative Agent, such Lender agrees to pay
to the Administrative Agent, forthwith on demand such amount, together with
interest thereon, for each day from such date until the date such amount is paid
to the Administrative Agent, equal to the greater of the Federal Funds Rate and
a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation plus any administrative, processing, or
similar fees customarily charged by the Administrative Agent in connection with
the foregoing.

2.15. Increase in Commitments.

(a) Request for Increase. Provided no Default then exists or would arise
therefrom, upon notice to the Administrative Agent (which shall promptly notify
the Lenders), the Lead Borrower may request two (2) increases in the Aggregate
Commitments by an amount not exceeding 25,000,000 for each such requested
increase (i.e., $50,000,000 in total for both such increases). At the time of
sending such notice, the Lead Borrower (in consultation with the Administrative
Agent) shall specify the time period within which each Lender is requested to
respond (which shall in no event be less than ten Business Days from the date of
delivery of such notice to the Lenders).

(b) Lender Elections to Increase. Each Lender shall notify the Administrative
Agent within such time period whether or not it agrees to increase its
Commitment and, if so, whether by an amount equal to, greater than, or less than
its Applicable Percentage of such requested increase. Any Lender not responding
within such time period shall be deemed to have declined to increase its
Commitment.

(c) Notification by Administrative Agent; Additional Lenders. The Administrative
Agent shall notify the Lead Borrower and each Lender of the Lenders’ responses
to Lead Borrower’s request made hereunder. To achieve the full amount of a
requested increase and subject to the approval of the Administrative Agent, the
LC Issuer and the Swing Line Lender (which approvals shall not be unreasonably
withheld), to the extent that the existing Lenders decline to increase their
Commitments, or decline to increase their Commitments to the amount requested by
the Lead Borrower, the Administrative Agent, in consultation with the Lead
Borrower, will use its reasonable efforts to arrange for other Eligible
Assignees to become a Lender hereunder and to issue commitments in an amount
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the increase in the Aggregate Commitments requested by the Lead Borrower and not
accepted by the existing Lenders (and the Lead Borrower may also invite
additional Eligible Assignees to become Lenders), provided, however, that
without the consent of the Administrative Agent, at no time shall the Commitment
of any such Lender (each an “Additional Commitment Lender”) be less than
$10,000,000.

(d) Effective Date and Allocations. If the Aggregate Commitments are increased
in accordance with this Section, the Administrative Agent, in consultation with
the Lead Borrower, shall determine the effective date (the “Increase Effective
Date”) and the final allocation of such increase. The Administrative Agent shall
promptly notify the Lead Borrower and the Lenders of the final allocation of
such increase and the Increase Effective Date and on the Increase Effective Date
(i) the Aggregate Commitments under, and for all purposes of, this Agreement
shall be increased by the aggregate amount of such Commitment increases, and
(ii) Schedule 2.01 shall be deemed modified, without further action, to reflect
the revised Commitments and Applicable Percentages of the Lenders.

(e) Conditions to Effectiveness of Increase. As a condition precedent to such
increase, (i) the Lead Borrower shall deliver to the Administrative Agent a
certificate of each Loan Party dated as of the Increase Effective Date (in
sufficient copies for each Lender) signed by a Responsible Officer of such Loan
Party (A) certifying and attaching the resolutions adopted by such Loan Party
approving or consenting to such increase, and (B) in the case of the Borrowers,
certifying that, before and after giving effect to such increase, (1) the
representations and warranties contained in Article V and the other Loan
Documents are true and correct in all material respects on and as of the
Increase Effective Date, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they are true
and correct in all material respects as of such earlier date, and except that
for purposes of this Section 2.15, the representations and warranties contained
in subsections (a) and (b) of Section 5.05 shall be deemed to refer to the most
recent statements furnished pursuant to clauses (a) and (b), respectively, of
Section 6.01, (ii) the Borrowers, the Administrative Agent, and any Additional
Commitment Lender shall have executed and delivered a joinder to the Loan
Documents in such form as the Administrative Agent shall reasonably require;
(iii) the Borrowers shall have paid such fees and other compensation to the
Additional Commitment Lenders as the Lead Borrower and such Additional
Commitment Lenders shall agree; (iv) the Borrowers shall have paid such
arrangement fees to the Administrative Agent as the Lead Borrower and the
Administrative Agent may agree; (v) the Borrowers shall deliver to the
Administrative Agent and the Lenders an opinion or opinions, in form and
substance reasonably satisfactory to the Administrative Agent, from counsel to
the Borrowers reasonably satisfactory to the Administrative Agent and dated such
date; (vi) the Borrowers and the Additional Commitment Lender shall have
delivered such other instruments, documents and agreements as the Administrative
Agent may reasonably have requested; and (vii) no Default shall then exist. The
Borrowers shall prepay any Committed Loans outstanding on the Increase Effective
Date (and pay any additional amounts required pursuant to Section 3.05) to the
extent necessary to keep the outstanding Committed Loans ratable with any
revised Applicable Percentages arising from any non-ratable increase in the
Commitments under this Section.

(f) Conflicting Provisions. This Section shall supersede any provisions in
Sections 2.13 or 10.01 to the contrary.

 

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ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY;

APPOINTMENT OF LEAD BORROWER

3.01. Taxes.

(a) Payments Free of Taxes. Any and all payments by or on account of any
obligation of the Borrowers hereunder or under any other Loan Document shall be
made free and clear of and without reduction or withholding for any Indemnified
Taxes or Other Taxes, provided that if the Borrowers shall be required by
applicable law to deduct any Indemnified Taxes (including any Other Taxes) from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, Lender or
LC Issuer, as the case may be, receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrowers shall make such
deductions and (iii) the Borrowers shall timely pay the full amount deducted to
the relevant Governmental Authority in accordance with applicable law.

(b) Payment of Other Taxes by the Borrowers. Without limiting the provisions of
subsection (a) above, the Borrowers shall timely pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.

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

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

(e) Status of Lenders. Any Foreign Lender that is entitled to an exemption from
or reduction of withholding tax under the law of the jurisdiction in which any
Borrower is resident for tax purposes, or any treaty to which such jurisdiction
is a party, with respect to payments hereunder or under any other Loan Document
shall deliver to the Lead Borrower (with a copy to the Administrative Agent), at
the time or times prescribed by applicable law or reasonably requested by the
Lead Borrower or the Administrative Agent, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate of withholding. Such delivery
shall be provided on the Closing Date and on or before such documentation
expires or becomes obsolete or after the occurrence of an event requiring a
change in the documentation most recently delivered. In addition, any Lender, if
requested by the Lead Borrower or the Administrative Agent, shall deliver such
other documentation prescribed by applicable law or reasonably requested by the
Lead Borrower or the Administrative Agent as will enable the Lead Borrower or
the Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements.

Without limiting the generality of the foregoing, in the event that any Borrower
is resident for tax purposes in the United States, any Foreign Lender shall
deliver to the Lead Borrower and the Administrative Agent (in such number of
copies as shall be requested by the recipient) on or prior to the date on which
such Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the request of the Lead Borrower or the Administrative Agent,
but only if such Foreign Lender is legally entitled to do so), whichever of the
following is applicable:

(i) duly completed copies of Internal Revenue Service Form W-8BEN claiming
eligibility for benefits of an income tax treaty to which the United States is a
party,

 

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(ii) duly completed copies of Internal Revenue Service Form W-8ECI,

(iii) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 881(c) of the Code, (x) a certificate to the
effect that such Foreign Lender is not (A) a “bank” within the meaning of
section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the
Borrowers within the meaning of section 881(c)(3)(B) of the Code, or (C) a
“controlled foreign corporation” described in section 881(c)(3)(C) of the Code
and (y) duly completed copies of Internal Revenue Service Form W-8BEN, or

(iv) any other form prescribed by applicable law as a basis for claiming
exemption from or a reduction in United States Federal withholding tax duly
completed together with such supplementary documentation as may be prescribed by
applicable law to permit the Lead Borrower to determine the withholding or
deduction required to be made.

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

3.02. Illegality. If the Administrative Agent determines that any Law has made
it unlawful, or that any Governmental Authority has asserted that it is
unlawful, for any Lender or its applicable Lending Office to make, maintain or
fund LIBO Rate Loans, or to determine or charge interest rates based upon the
LIBO Rate, or any Governmental Authority has imposed material restrictions on
the authority of such Lender to purchase or sell, or to take deposits of,
Dollars in the London interbank market, then, on notice thereof by such Lender
to the Lead Borrower through the Administrative Agent, any obligation of such
Lender to make or continue LIBO Rate Loans or to convert Base Rate Loans to LIBO
Rate Loans shall be suspended until such Lender notifies the Administrative
Agent and the Lead Borrower that the circumstances giving rise to such
determination no longer exist. Upon receipt of such notice, the Borrowers shall,
upon demand from such Lender (with a copy to the Administrative Agent), prepay
or, if applicable, convert all LIBO Rate Loans of such Lender to Base Rate
Loans, either on the last day of the Interest Period therefor, if such Lender
may lawfully continue to maintain such LIBO Rate Loans to such day, or
immediately, if such Lender may not lawfully continue to maintain such LIBO Rate
Loans. Upon any such prepayment or conversion, the Borrowers shall also pay
accrued interest on the amount so prepaid or converted.

 

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

3.04. Increased Costs; Reserves on LIBO Rate Loans.

(a) Increased Costs Generally. If any Change in Law shall:

(i) 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 LIBO Rate) or the LC Issuer;

(ii) subject any Lender or the LC Issuer 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 LIBO Rate Loan made by it, or change the basis of taxation of
payments to such Lender or the LC Issuer in respect thereof (except for
Indemnified Taxes or Other Taxes covered by Section 3.01 and the imposition of,
or any change in the rate of, any Excluded Tax payable by such Lender or the LC
Issuer); or

(iii) impose on any Lender or the LC Issuer or the London interbank market any
other condition, cost or expense affecting this Agreement or LIBO 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 LIBO Rate Loan (or of maintaining its
obligation to make any such Loan), or to increase the cost to such Lender or the
LC Issuer 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 LC Issuer hereunder (whether of principal, interest or any other
amount) then, upon request of such Lender or the LC Issuer, the Borrowers will
pay to such Lender or the LC Issuer, as the case may be, such additional amount
or amounts as will compensate such Lender or the LC Issuer, as the case may be,
for such additional costs incurred or reduction suffered.

(b) Capital Requirements. If any Lender or the LC Issuer determines that any
Change in Law affecting such Lender or the LC Issuer or any Lending Office of
such Lender or such Lender’s or the LC Issuer’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 LC Issuer’s capital or on the capital of such
Lender’s or the LC Issuer’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 LC Issuer, to a level below that which such Lender or the
LC Issuer or such Lender’s or the LC Issuer’s holding company could have
achieved but for such Change in Law (taking into consideration such Lender’s or
the LC Issuer’s policies and the policies of such

 

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Lender’s or the LC Issuer’s holding company with respect to capital adequacy),
then from time to time the Borrowers will pay to such Lender or the LC Issuer,
as the case may be, such additional amount or amounts as will compensate such
Lender or the LC Issuer or such Lender’s or the LC Issuer’s holding company for
any such reduction suffered.

(c) Certificates for Reimbursement. A certificate of a Lender or the LC Issuer
setting forth in reasonable detail the amount or amounts necessary to compensate
such Lender or the LC Issuer or its holding company, as the case may be, as
specified in subsection (a) or (b) of this Section and delivered to the Lead
Borrower shall be conclusive absent manifest error. The Borrowers shall pay such
Lender or the LC Issuer, as the case may be, the amount shown as due on any such
certificate within ten (10) days after receipt thereof.

(d) Delay in Requests. Failure or delay on the part of any Lender or the LC
Issuer to demand compensation pursuant to the foregoing provisions of this
Section shall not constitute a waiver of such Lender’s or the LC Issuer’s right
to demand such compensation, provided that the Borrowers shall not be required
to compensate a Lender or the LC Issuer pursuant to the foregoing provisions of
this Section for any increased costs incurred or reductions suffered more than
nine (9) months prior to the date that such Lender or the LC Issuer, as the case
may be, notifies the Lead Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender’s or the LC Issuer’s intention
to claim compensation therefor (except that, if the Change in Law giving rise to
such increased costs or reductions is retroactive, then the nine (9)-month
period referred to above shall be extended to include the period of retroactive
effect thereof).

(e) Reserves on LIBO Rate Loans. The Borrowers shall pay to each Lender, so long
as such Lender shall be required to maintain reserves with respect to
liabilities or assets consisting of or including Eurocurrency funds or deposits
(currently known as “Eurocurrency liabilities”), additional interest on the
unpaid principal amount of each LIBO Rate Loan equal to the actual costs of such
reserves allocated to such Loan by such Lender (as determined by such Lender in
good faith, which determination shall be conclusive), which shall be due and
payable on each date on which interest is payable on such Loan; provided, that,
the Lead Borrower shall have received at least ten (10) days’ prior notice (with
a copy to the Administrative Agent) of such additional interest from such
Lender. If a Lender fails to give notice ten (10) days prior to the relevant
Interest Payment Date, such additional interest shall be due and payable ten
(10) days from receipt of such notice.

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

(a) any continuation, conversion, payment or prepayment of any Loan other than a
Base Rate Loan on a day other than the last day of the Interest Period for such
Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or
otherwise);

(b) any failure by the Borrowers (for a reason other than the failure of such
Lender to make a Loan) to prepay, borrow, continue or convert any Loan other
than a Base Rate Loan on the date or in the amount notified by the Lead
Borrower; or

(c) any assignment of a LIBO Rate Loan on a day other than the last day of the
Interest Period therefor as a result of a request by the Lead Borrower pursuant
to Section 10.13;

including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
The Borrowers shall also pay any customary administrative fees charged by such
Lender in connection with the foregoing.

 

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For purposes of calculating amounts payable by the Borrowers to the Lenders
under this Section 3.05, each Lender shall be deemed to have funded each LIBO
Rate Loan made by it at the LIBO Rate for such Loan by a matching deposit or
other borrowing in the London interbank market for a comparable amount and for a
comparable period, whether or not such LIBO Rate Loan was in fact so funded.

3.06. Mitigation Obligations; Replacement of Lenders.

(a) Designation of a Different Lending Office. If any Lender requests
compensation under Section 3.04, or the Borrowers are required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 3.01, or if any Lender gives a notice pursuant to
Section 3.02, then such Lender shall use reasonable efforts to designate a
different Lending Office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04,
as the case may be, in the future, or eliminate the need for the notice pursuant
to Section 3.02, as applicable, and (ii) in each case, would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. The Borrowers hereby agree to pay all reasonable
costs and expenses incurred by any Lender in connection with any such
designation or assignment.

(b) Replacement of Lenders. If any Lender requests compensation under
Section 3.04, or if the Borrowers are required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 3.01, the Borrowers may replace such Lender in accordance with
Section 10.13.

3.07. Survival. All of the Borrowers’ obligations under this Article III shall
survive termination of the Aggregate Commitments and repayment of all other
Obligations hereunder.

3.08. Designation of Lead Borrower as Borrowers’ Agent.

(a) Each Borrower hereby irrevocably designates and appoints the Lead Borrower
as such Borrower’s agent to obtain Credit Extensions, the proceeds of which
shall be available to each Borrower for such uses as are permitted under this
Agreement. As the disclosed principal for its agent, each Borrower shall be
obligated to each Credit Party on account of Credit Extensions so made as if
made directly by the applicable Credit Party to such Borrower, notwithstanding
the manner by which such Credit Extensions are recorded on the books and records
of the Lead Borrower and of any other Borrower. In addition, each Loan Party
other than the Borrowers hereby irrevocably designates and appoints the Lead
Borrower as such Loan Party’s agent to represent such Loan Party in all respects
under this Agreement and the other Loan Documents.

(b) Each Borrower recognizes that credit available to it hereunder is in excess
of and on better terms than it otherwise could obtain on and for its own account
and that one of the reasons therefor is its joining in the credit facility
contemplated herein with all other Borrowers. Consequently, each Borrower hereby
assumes and agrees to discharge all Obligations of each of the other Borrowers.

(c) The Lead Borrower shall act as a conduit for each Borrower (including
itself, as a “Borrower”) on whose behalf the Lead Borrower has requested a
Credit Extension. Neither the Administrative Agent nor any other Credit Party
shall have any obligation to see to the application of such proceeds therefrom.

 

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ARTICLE IV

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

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

(a) the Administrative Agent’s receipt of the following, each of which shall be
originals, facsimile or other electronic image scan transmission (e.g., “pdf” or
“tif “ via e-mail), followed promptly by originals unless otherwise specified,
each properly executed by a Responsible Officer of the signing Loan Party or the
Lenders, as applicable, each dated the Closing Date (or, in the case of
certificates of governmental officials, a recent date before the Closing Date)
and each in form and substance reasonably satisfactory to the Administrative
Agent:

(i) executed counterparts of this Agreement sufficient in number for
distribution to the Administrative Agent, each Lender and the Lead Borrower;

(ii) a Note executed by the Borrowers in favor of each Lender requesting a Note;

(iii) such certificates of resolutions or other action, incumbency certificates
and/or other certificates of Responsible Officers of each Loan Party as the
Administrative Agent may reasonably require evidencing (A) the authority of each
Loan Party to enter into this Agreement and the other Loan Documents to which
such Loan Party is a party or is to become a party and (B) the identity,
authority and capacity of each Responsible Officer thereof authorized to act as
a Responsible Officer in connection with this Agreement and the other Loan
Documents to which such Loan Party is a party or is to become a party;

(iv) copies of each Loan Party’s Organization Documents and such other documents
and certifications as the Administrative Agent may reasonably require to
evidence that each Loan Party is duly organized or formed, and that each Loan
Party is validly existing, in good standing and qualified to engage in business
in each jurisdiction where its ownership, lease or operation of properties or
the conduct of its business requires such qualification, except to the extent
that failure to so qualify in such jurisdiction could not reasonably be expected
to have a Material Adverse Effect;

(v) a favorable written opinion of McGuireWoods LLP, counsel to the Loan
Parties, dated the Closing Date, addressed to the Administrative Agent, LC
Issuer and the Lenders, in form and substance reasonably satisfactory to the
Administrative Agent, as to such matters concerning the Loan Parties and the
Loan Documents as the Administrative Agent may reasonably request;

(vi) a certificate signed by a Responsible Officer of the Lead Borrower
certifying (A) that the conditions specified in Sections 4.02(a) and (b) have
been satisfied, (B) that there has been no event or circumstance since the date
of the Audited Financial Statements that has had or could be reasonably expected
to have, either individually or in the aggregate, a Material Adverse Effect,
(C) to the Solvency of the Loan Parties as of the Closing Date after giving
effect to the transactions contemplated hereby, and (D) either that (1) no
consents, licenses or approvals are required in connection with the execution,
delivery and performance by such Loan Party and the validity against such Loan
Party of the Loan Documents to which it is a party, or (2) that all such
consents, licenses and approvals have been obtained and are in full force and
effect;

 

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(vii) a duly completed Compliance Certificate as of the last day of the Fiscal
Quarter of the Lead Borrower and its Subsidiaries most recently ended prior to
the Closing Date, signed by a Responsible Officer of the Lead Borrower;

(viii) evidence that all insurance required to be maintained pursuant to the
Loan Documents and all endorsements in favor of the Administrative Agent
required under the Loan Documents have been obtained and are in effect;

(ix) the Security Documents, each duly executed by the applicable Loan Parties;

(x) all other Loan Documents, each duly executed by the applicable Loan Parties;

(xi) results of searches or other evidence reasonably satisfactory to the
Administrative Agent (in each case dated as of a date reasonably satisfactory to
the Administrative Agent) indicating the absence of Liens on the assets of the
Loan Parties, except for Permitted Encumbrances;

(xii) (A) all documents and instruments, including Uniform Commercial Code
financing statements, required by law or reasonably requested by the
Administrative Agent to be filed, registered or recorded to create or perfect
the first priority Liens intended to be created under the Loan Documents and all
such documents and instruments shall have been so filed, registered or recorded
to the satisfaction of the Administrative Agent, (B) the DDA Notifications,
Credit Card Notifications, and Blocked Account Agreements required pursuant to
Section 6.13 hereof, (C) control agreements with respect to the Loan Parties’
securities and investment accounts, and (D) Collateral Access Agreements as
required by the Administrative Agent; and

(xiii) such other assurances, certificates, documents, or consents as the
Administrative Agent reasonably may require.

(b) the Administrative Agent shall have received a Borrowing Base Certificate
dated the Closing Date, relating to the month ended on July 30, 2011, and
executed by a Responsible Officer of the Lead Borrower.

(c) the Administrative Agent shall be reasonably satisfied that any financial
statements delivered to it fairly present the business and financial condition
of the Loan Parties and that there has been no Material Adverse Effect since the
date of the most recent financial information delivered to the Administrative
Agent.

(d) the Administrative Agent shall have received and be reasonably satisfied
with (i) a forecast for the period commencing on the Closing Date through the
Fiscal Year ending on or about January 31, 2013, which shall include (A) an
Excess Availability model, Consolidated income statement and statement of cash
flow, and (B) so long as there are no Loans outstanding and no Loans requested
by Borrowers on the Closing Date, a balance sheet as of the end of each of the
Fiscal Years ending on or about January 31, 2012 and on or about January 31,
2013, respectively, or, if there are Loans outstanding or Loans requested by
Borrowers on the Closing Date, then such forecast shall include a balance sheet
as of the end of each Fiscal Quarter following the Closing Date through the end
of the Fiscal Year ending on or about January 31, 2013, and (ii) such other
information (financial or otherwise) reasonably requested by the Administrative
Agent.

 

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(e) there shall not be pending any litigation or other proceeding, the result of
which, either individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.

(f) there shall not have occurred any default of any Material Contract of any
Loan Party, the result of which, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

(g) the consummation of the transactions contemplated hereby shall not violate
any applicable Law or any Organization Document.

(h) the Administrative Agent shall have received reasonably satisfactory
confirmation that all fees, charges and disbursements of counsel to the
Administrative Agent to the extent invoiced prior to or on the Closing Date,
plus such additional amounts of such fees, charges and disbursements as shall
constitute its reasonable estimate of such fees, charges and disbursements
incurred or to be incurred by it through the closing proceedings (provided that
such estimate shall not thereafter preclude a final settling of accounts between
the Borrowers and the Administrative Agent) will be paid by the Borrowers
concurrently with the initial Credit Extension.

(i) the Administrative Agent shall have received all documentation and other
information requested by the Administrative Agent as required by regulatory
authorities under applicable “know your customer” and anti-money laundering
rules and regulations, including without limitation the Act.

(j) no material changes in governmental regulations or policies affecting any
Loan Party or any Credit Party shall have occurred prior to the Closing Date.

(k) the Closing Date shall have occurred on or before October 31, 2011 or such
other date as to which the Lead Borrower and the Administrative Agent may agree.
The Administrative Agent shall notify the Lead Borrower of the Closing Date, and
such notice shall be conclusive and binding on the Loan Parties.

Without limiting the generality of the provisions of Section 9.04, for purposes
of determining compliance with the conditions specified in this Section 4.01,
each Lender that has signed this Agreement shall be deemed to have Consented to,
approved or accepted or to be satisfied with, each document or other matter
required thereunder to be Consented to or approved by or acceptable or
satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.

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

(a) the representations and warranties of each other Loan Party contained in
Article V or any other Loan Document, or which are contained in any document
furnished at any time under or in connection herewith or therewith, shall be
true and correct in all material respects on and as of the date of such Credit
Extension, except (i) to the extent that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct in all material respects as of such earlier date, (ii) in the case of
any representation and warranty qualified by materiality, they shall be true and

 

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correct in all respects, and (iii) for purposes of this Section 4.02, the
representations and warranties contained in subsections (a) and (b) of
Section 5.05 shall be deemed to refer to the most recent statements furnished
pursuant to clauses (a) and (b), respectively, of Section 6.01;

(b) no Default shall exist, or would result from such proposed Credit Extension
or from the application of the proceeds thereof;

(c) the Administrative Agent and, if applicable, the LC Issuer or the Swing Line
Lender shall have received a Request for Credit Extension in accordance with the
requirements hereof;

(d) no event or circumstance which could reasonably be expected to result in a
Material Adverse Effect shall have occurred;

(e) no Overadvance shall result from such Credit Extension (other than a
Permitted Overadvance); and

(f) the Administrative Agent shall have received a Borrowing Base Certificate,
certified as complete and correct by a Responsible Officer of the Lead Borrower
as of the close of business on the immediately preceding Fiscal Month.

Each Request for Credit Extension (other than a Committed Loan Notice requesting
only a conversion of Committed Loans to the other Type or a continuation of LIBO
Rate Loans) submitted by the Borrowers shall be deemed to be a representation
and warranty by the Borrowers that the conditions specified in Sections 4.02(a)
and (b) have been satisfied on and as of the date of the applicable Credit
Extension. The conditions set forth in this Section 4.02 are for the sole
benefit of the Credit Parties, but until the Required Lenders otherwise direct
the Administrative Agent to cease making Committed Loans, the Lenders will fund
their Applicable Percentage of all Loans and participate in all Swing Line Loans
and Letters of Credit whenever made or issued, which are requested by the Lead
Borrower and which, notwithstanding the failure of the Loan Parties to comply
with the provisions of this Article IV, agreed to by the Administrative Agent,
provided, that, the making of any such Loans or the issuance of any Letters of
Credit shall not be deemed a modification or waiver by any Credit Party of the
provisions of this Article IV on any future occasion or a waiver of any rights
or the Credit Parties as a result of any such failure to comply.

ARTICLE V

REPRESENTATIONS AND WARRANTIES

To induce the Credit Parties to enter into this Agreement and to make Loans and
to issue Letters of Credit hereunder, each Loan Party represents and warrants to
the Administrative Agent and the other Credit Parties that:

5.01. Existence, Qualification and Power. Each Loan Party and each Subsidiary
thereof (a) is a corporation, limited liability company, partnership or limited
partnership, duly incorporated, organized or formed, validly existing and, where
applicable, in good standing under the Laws of the jurisdiction of its
incorporation, organization, or formation (b) has all requisite power and
authority and all requisite governmental licenses, permits, authorizations,
consents and approvals to (i) own or lease its assets and carry on its business
and (ii) execute, deliver and perform its obligations under the Loan Documents
to which it is a party, and (c) is duly qualified and is licensed and, where
applicable, in good standing under the Laws of each jurisdiction where its
ownership, lease or operation of properties or the conduct of its business
requires such qualification or license; except in each case referred to in
clause (b)(i) or (c), to the extent that failure to do so could not reasonably
be expected to have a Material

 

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Adverse Effect. Schedule 5.01 annexed hereto sets forth, as of the Closing Date,
each Loan Party’s name as it appears in official filings in its state of
incorporation or organization, its state of incorporation or organization,
organization type, organization number, if any, issued by its state of
incorporation or organization, and its federal employer identification number.

5.02. Authorization; No Contravention. The execution, delivery and performance
by each Loan Party of each Loan Document to which such Person is or is to be a
party, has been duly authorized by all necessary corporate or other
organizational action, and does not and will not (a) contravene the terms of any
of such Person’s Organization Documents; (b) conflict with or result in any
breach, termination, or contravention of, or constitute a default under, or
require any payment to be made under (i) any Material Contract or any Material
Indebtedness to which such Person is a party or affecting such Person or the
properties of such Person or any of its Subsidiaries or (ii) any order,
injunction, writ or decree of any Governmental Authority or any arbitral award
to which such Person or its property is subject; (c) result in or require the
creation of any Lien upon any asset of any Loan Party (other than Liens in favor
of the Administrative Agent under the Security Documents); or (d) violate any
Law.

5.03. Governmental Authorization; Other Consents. No approval, consent
(including, the consent of Equity Interests holders or creditors of any Loan
Party), exemption, authorization, license or other action by, or notice to, or
filing with, any Governmental Authority or regulatory body or any other Person
is necessary or required for the grant of the Liens by such Loan Party in the
Collateral pursuant to the Security Documents or for the execution, delivery or
performance by, or enforcement against, any Loan Party of this Agreement or any
other Loan Document, except for (a) the perfection or maintenance of the Liens
created under the Security Documents (including the first priority nature
thereof) and (b) such consents which have been obtained or made prior to the
date hereof and are in full force and effect.

5.04. Binding Effect. This Agreement has been, and each other Loan Document,
when delivered, will have been, duly executed and delivered by each Loan Party
that is party thereto. This Agreement constitutes, and each other Loan Document
when so delivered will constitute, a legal, valid and binding obligation of such
Loan Party, enforceable against each Loan Party that is party thereto in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered in
a proceeding in equity or at law.

5.05. Financial Statements; No Material Adverse Effect.

(a) The Audited Financial Statements (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; (ii) fairly present the financial condition of the Lead
Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; and (iii) show all Material Indebtedness and other liabilities,
direct or contingent, of the Lead Borrower and its Subsidiaries as of the date
thereof, including liabilities for taxes, material commitments and Indebtedness.

(b) The unaudited Consolidated balance sheet of the Lead Borrower and its
Subsidiaries dated July 30, 2011, and the related Consolidated statements of
income or operations, Shareholders’ Equity and cash flows for the fiscal quarter
ended on that date (i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein, and (ii) fairly present the financial condition of the Lead
Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby, subject, in the case of clauses
(i) and (ii), to the absence of footnotes and to normal year-end audit
adjustments. Schedule 5.05 sets forth all Material Indebtedness and other
liabilities, direct or contingent, of the Loan Parties and their Consolidated
Subsidiaries as of the date of such financial statements, including liabilities
for taxes, material commitments and Material Indebtedness.

 

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(c) Since the date of the Audited Financial Statements, there has been no event
or circumstance, either individually or in the aggregate, that has had or could
reasonably be expected to have a Material Adverse Effect.

(d) To the knowledge of the Lead Borrower, no Internal Control Event exists or
has occurred since the date of the Audited Financial Statements that has
resulted in or could reasonably be expected to result in a misstatement in any
material respect, in any financial information delivered or to be delivered to
the Administrative Agent or the Lenders, of (i) covenant compliance calculations
provided hereunder or (ii) the assets, liabilities, financial condition or
results of operations of the Lead Borrower and its Subsidiaries on a
Consolidated basis.

(e) The Consolidated forecasted balance sheet and statements of income and cash
flows of the Lead Borrower and its Subsidiaries delivered pursuant to
Section 6.01(d) were prepared in good faith on the basis of the assumptions
stated therein, which assumptions were fair in light of the conditions existing
at the time of delivery of such forecasts, and represented, at the time of
delivery, the Loan Parties’ good faith estimate of its future financial
performance.

5.06. Litigation. There are no actions, suits, proceedings, claims or disputes
pending or, to the knowledge of the Loan Parties, threatened, at law, in equity,
in arbitration or before any Governmental Authority, by or against any Loan
Party or any of its Subsidiaries or against any of its properties or revenues
that (a) purport to affect or pertain to this Agreement or any other Loan
Document, or any of the transactions contemplated hereby, or (b) either
individually or in the aggregate, if determined adversely, could reasonably be
expected to have a Material Adverse Effect.

5.07. No Default. No Loan Party or any Subsidiary is in default in any material
respect under or with respect to any Material Contract or any Material
Indebtedness. No Default has occurred and is continuing or would result from the
consummation of the transactions contemplated by this Agreement or any other
Loan Document.

5.08. Ownership of Property; Liens.

(a) Each of the Loan Parties and each Subsidiary thereof has good record and
marketable title in fee simple to, valid leasehold interests in or other valid
right to use, all real property material to the ordinary conduct of its
business. Each of the Loan Parties and each Subsidiary has good and marketable
title to, valid leasehold interests in, valid license or other contractual right
to use all personal property and assets material to the ordinary conduct of its
business.

(b) Schedule 5.08(b)(1) sets forth the address (including street address, county
and state) of all Real Estate that is owned by the Loan Parties, together with a
list of the holders of any mortgage or other Lien thereon as of the Closing
Date. Each Loan Party and each of its Subsidiaries has good, marketable and
insurable fee simple title to the real property owned by such Loan Party or such
Subsidiary, free and clear of all Liens, other than Permitted Encumbrances.
Schedule 5.08(b)(2) sets forth the address (including street address, county and
state) of all Leases of the Loan Parties, together with a list of the lessor and
its contact information with respect to each such Lease as of the Closing Date.
Each of such Leases is in full force and effect and the Loan Parties are not in
default in any material respect of the terms thereof.

 

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(c) Schedule 7.01 sets forth a complete and accurate list of all Liens on the
property or assets of each Loan Party and each of its Subsidiaries, showing as
of the Closing Date the lienholder thereof, and the property or assets of such
Loan Party or such Subsidiary subject thereto. The property of each Loan Party
and each of its Subsidiaries is subject to no Liens, other than Permitted
Encumbrances.

(d) Schedule 7.02 sets forth a complete and accurate list of all Investments
held by any Loan Party or any Subsidiary of a Loan Party on the Closing Date,
showing as of the date hereof the amount, obligor or issuer and maturity, if
any, thereof.

(e) Schedule 7.03 sets forth a complete and accurate list of all Indebtedness of
each Loan Party or any Subsidiary of a Loan Party on the Closing Date, showing
as of the date hereof the amount, obligor or issuer and maturity thereof.

5.09. Environmental Compliance.

(a) Except as specifically disclosed in Schedule 5.09, no Loan Party or any
Subsidiary thereof (i) has failed to comply with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required
under any Environmental Law, (ii) has become subject to any Environmental
Liability, (iii) has received notice of any claim with respect to any
Environmental Liability or (iv) knows of any basis for any Environmental
Liability, except, in each case, as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

(b) To the knowledge of the Loan Parties, except as otherwise set forth in
Schedule 5.09, none of the properties currently or formerly owned or operated by
any Loan Party or any Subsidiary thereof is listed or proposed for listing on
the NPL or on the CERCLIS or any analogous foreign, state or local list or is
adjacent to any such property; there are no and never have been any underground
or above-ground storage tanks or any surface impoundments, septic tanks, pits,
sumps or lagoons in which Hazardous Materials are being or have been treated,
stored or disposed on any property currently owned or operated by any Loan Party
or any Subsidiary thereof or on any property formerly owned or operated by any
Loan Party or Subsidiary thereof; there is no asbestos or asbestos-containing
material on any property currently owned or operated by any Loan Party or
Subsidiary thereof; and Hazardous Materials have not been released, discharged
or disposed of on any property currently or formerly owned or operated by any
Loan Party or any Subsidiary thereof.

(c) Except as otherwise set forth on Schedule 5.09, no Loan Party or any
Subsidiary thereof is undertaking, and no Loan Party or any Subsidiary thereof
has completed, either individually or together with other potentially
responsible parties, any investigation or assessment or remedial or response
action relating to any actual or threatened release, discharge or disposal of
Hazardous Materials at any site, location or operation, either voluntarily or
pursuant to the order of any Governmental Authority or the requirements of any
Environmental Law which investigation, assessment or other action has disclosed
any material concern as existing or potential violations of Environmental Laws;
and all Hazardous Materials generated, used, treated, handled or stored at, or
transported to or from, any property currently or formerly owned or operated by
any Loan Party or any Subsidiary thereof have been disposed of, are stored or
used in a manner not reasonably expected to result in material liability to any
Loan Party or any Subsidiary thereof.

5.10. Insurance. The properties of the Loan Parties and their Subsidiaries are
insured with financially sound and reputable insurance companies which are not
Affiliates of the Loan Parties, in such amounts (after giving effect to any
self-insurance), with such deductibles and covering such risks (including,
without limitation, workmen’s compensation, public liability, business
interruption and property damage insurance) as are customarily carried by
companies engaged in similar businesses and

 

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owning similar properties in localities where the Loan Parties or the applicable
Subsidiary operates. Schedule 5.10 sets forth a description of all insurance
maintained by or on behalf of the Loan Parties as of the Closing Date. Each
insurance policy listed on Schedule 5.10 is in full force and effect and all
premiums in respect thereof that are due and payable have been paid.

5.11. Taxes. The Loan Parties and their Subsidiaries have filed all Federal,
state and other material tax returns and reports required to be filed, and have
paid all Federal, state and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in good
faith by appropriate proceedings being diligently conducted, for which adequate
reserves have been provided in accordance with GAAP, as to which Taxes no Lien
has been filed and which contest effectively suspends the collection of the
contested obligation and the enforcement of any Lien securing such obligation.
There is no proposed tax assessment against any Loan Party or any Subsidiary
that would, if made, have a Material Adverse Effect. No Loan Party or any
Subsidiary thereof is a party to any tax sharing agreement.

5.12. ERISA Compliance.

(a) Each Plan is in compliance in all material respects with the applicable
provisions of ERISA, the Code and other Federal or state Laws. Each Plan that is
intended to qualify under Section 401(a) of the Code has received a favorable
determination letter from the IRS or an application for such a letter is
currently being processed by the IRS with respect thereto and, to the knowledge
of the Lead Borrower, nothing has occurred which would prevent, or cause the
loss of, such qualification. The Loan Parties and each ERISA Affiliate have made
all required contributions to each 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. No
Lien imposed under the Code or ERISA exists or is likely to arise on account of
any Plan.

(b) There are no pending or, to the knowledge of the Lead Borrower, threatened
claims, actions or lawsuits, or action by any Governmental Authority, with
respect to any Plan that could reasonably be expected to have a Material Adverse
Effect. There has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan that has resulted or could
reasonably be expected to result in a Material Adverse Effect.

(c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) no
Pension Plan has any Unfunded Pension Liability; (iii) neither any Loan Party
nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability under Title IV of ERISA with respect to any Pension Plan (other than
premiums due and not delinquent under Section 4007 of ERISA); (iv) neither any
Loan Party nor any ERISA Affiliate has incurred, or reasonably expects 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 Sections 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) neither any Loan
Party nor any ERISA Affiliate has engaged in a transaction that could be subject
to Sections 4069 or 4212(c) of ERISA.

5.13. Subsidiaries; Equity Interests. The Loan Parties have no Subsidiaries
other than those specifically disclosed in Part (a) of Schedule 5.13, which
Schedule sets forth the legal name, jurisdiction of incorporation or formation
and authorized Equity Interests of each such Subsidiary. All of the outstanding
Equity Interests in such Subsidiaries have been validly issued, are fully paid
and non-assessable and are owned by a Loan Party (or a Subsidiary of a Loan
Party) in the amounts specified on Part (a) of Schedule 5.13 free and clear of
all Liens except for those created under the Security Documents. Except as set
forth in Schedule 5.13, there are no outstanding rights to purchase any Equity
Interests in any Subsidiary. The Loan Parties have no equity investments in any
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entity other than those specifically disclosed in Part (b) of Schedule 5.13. All
of the outstanding Equity Interests in the Loan Parties have been validly
issued, and are fully paid and non-assessable and are owned in the amounts
specified on Part (c) of Schedule 5.13 free and clear of all Liens except for
those created under the Security Documents. The copies of the Organization
Documents of each Loan Party and each amendment thereto provided pursuant to
Section 4.01 are true and correct copies of each such document, each of which is
valid and in full force and effect.

5.14. Margin Regulations; Investment Company Act;

(a) No Loan Party is engaged or will be engaged, principally or as one of its
important activities, in the business of purchasing or carrying margin stock
(within the meaning of Regulation U issued by the FRB), or extending credit for
the purpose of purchasing or carrying margin stock. None of the proceeds of the
Credit Extensions shall be used directly or indirectly for the purpose of
purchasing or carrying any margin stock, for the purpose of reducing or retiring
any Indebtedness that was originally incurred to purchase or carry any margin
stock or for any other purpose that might cause any of the Credit Extensions to
be considered a “purpose credit” within the meaning of Regulations T, U, or X
issued by the FRB.

(b) None of the Loan Parties, any Person Controlling any Loan Party, or any
Subsidiary is or is required to be registered as an “investment company” under
the Investment Company Act of 1940.

5.15. Disclosure. Each Loan Party has disclosed to the Administrative Agent and
the Lenders all agreements, instruments and corporate or other restrictions to
which it or any of its Subsidiaries is subject, and all other matters known to
it, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect. No report, financial statement, certificate
or other information furnished (whether in writing or orally) by or on behalf of
any Loan Party to the Administrative Agent or any Lender in connection with the
transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder or under any other Loan Document (in each case, as modified
or supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projected financial
information, the Loan Parties represent only that such information was prepared
in good faith based upon assumptions believed by the Loan Parties to be
reasonable at the time.

5.16. Compliance with Laws. Each of the Loan Parties and each Subsidiary is in
compliance in all material respects with the requirements of all Laws and all
orders, writs, injunctions and decrees applicable to it or to its properties,
except in such instances in which (a) such requirement of Law or order, writ,
injunction or decree is being contested in good faith by appropriate proceedings
diligently conducted or (b) the failure to comply therewith, either individually
or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

5.17. Intellectual Property; Licenses, Etc. The Loan Parties and their
Subsidiaries own, or possess the right to use, all of the Intellectual Property,
licenses, permits and other authorizations that are reasonably necessary for the
operation of their respective businesses, without conflict with the rights of
any other Person. To the knowledge of the Lead Borrower, no material slogan or
other advertising device, product, process, method, substance, part or other
material now employed, or now contemplated to be employed, by any Loan Party or
any Subsidiary infringes upon any rights held by any other Person except as
could not reasonably be expected to have a Material Adverse Effect. Except as
specifically disclosed in Schedule 5.17, no claim or litigation regarding any of
the foregoing is pending or, to the knowledge of the Lead Borrower, threatened,
which, either individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.

 

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5.18. Labor Matters. There are no strikes, lockouts, slowdowns or other material
labor disputes against any Loan Party or any Subsidiary thereof pending or, to
the knowledge of any Loan Party, threatened. The hours worked by and payments
made to employees of the Loan Parties comply in all material respects with the
Fair Labor Standards Act and any other applicable federal, state, local or
foreign Law dealing with such matters. No Loan Party or any of its Subsidiaries
has incurred any liability or obligation under the Worker Adjustment and
Retraining Act or similar state Law in excess of $50,000. All payments due from
any Loan Party and its Subsidiaries, or for which any claim may be made against
any Loan Party or any of its Subsidiaries, on account of wages and employee
health and welfare insurance and other benefits, have been paid or properly
accrued in accordance with GAAP as a liability on the books of such Loan Party.
Except as set forth on Schedule 5.18, no Loan Party or any Subsidiary is a party
to or bound by any collective bargaining agreement, management agreement,
employment agreement, bonus, restricted stock, stock option, or stock
appreciation plan or agreement or any similar plan, agreement or arrangement.
There are no representation proceedings pending or, to any Loan Party’s
knowledge, threatened to be filed with the National Labor Relations Board, and
no labor organization or group of employees of any Loan Party or any Subsidiary
has made a pending demand for recognition. There are no complaints, unfair labor
practice charges, grievances, arbitrations, unfair employment practices charges
or any other claims or complaints against any Loan Party or any Subsidiary
pending or, to the knowledge of any Loan Party, threatened to be filed with any
Governmental Authority or arbitrator based on, arising out of, in connection
with, or otherwise relating to the employment or termination of employment of
any employee of any Loan Party or any of its Subsidiaries, an adverse
determination of which could reasonably be expected to have a Material Adverse
Effect. The consummation of the transactions contemplated by the Loan Documents
will not give rise to any right of termination or right of renegotiation on the
part of any union under any collective bargaining agreement to which any Loan
Party or any of its Subsidiaries is bound.

5.19. Security Documents. The Security Agreement creates in favor of the
Administrative Agent, for the benefit of the Secured Parties referred to
therein, a legal, valid, continuing and enforceable Lien in the Collateral (as
defined in the Security Agreement), the enforceability of which is subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.
The financing statements, releases and other filings are in appropriate form and
have been or will be filed in the offices specified in Schedule 8 of the
Security Agreement. Upon such filings and/or the obtaining of “control,” (as
defined in the UCC) the Administrative Agent will have a perfected Lien on, and
security interest in, to and under all right, title and interest of the Loan
Parties in all Collateral that may be perfected by filing, recording or
registering a financing statement or analogous document (including without
limitation the proceeds of such Collateral subject to the limitations relating
to such proceeds in the UCC) or by obtaining control, under the UCC (in effect
on the date this representation is made) in each case prior and superior in
right to any other Person.

5.20. Solvency.

After giving effect to the transactions contemplated by this Agreement, and
before and after giving effect to each Credit Extension, each of the Loan
Parties is Solvent. No transfer of property has been or will be made by any Loan
Party and no obligation has been or will be incurred by any Loan Party in
connection with the transactions contemplated by this Agreement or the other
Loan Documents with the intent to hinder, delay, or defraud either present or
future creditors of any Loan Party.

 

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5.21. Deposit Accounts; Credit Card Arrangements.

(a) Annexed hereto as Schedule 5.21(a) is a list of all DDAs maintained by the
Loan Parties as of the Closing Date, which Schedule includes, with respect to
each DDA (i) the name and address of the depository; (ii) the account number(s)
maintained with such depository; (iii) a contact person at such depository, and
(iv) the identification of each Blocked Account Bank.

(b) Annexed hereto as Schedule 5.21(b) is a list describing all arrangements as
of the Closing Date to which any Loan Party is a party with respect to the
processing and/or payment to such Loan Party of the proceeds of any credit card
charges and debit card charges for sales made by such Loan Party.

5.22. Brokers. No broker or finder brought about the obtaining, making or
closing of the Loans or transactions contemplated by the Loan Documents, and no
Loan Party or Affiliate thereof has any obligation to any Person in respect of
any finder’s or brokerage fees in connection therewith.

5.23. [Reserved]

5.24. Material Contracts. Schedule 5.24 sets forth all Material Contracts to
which any Loan Party is a party or is bound as of the Closing Date. The Loan
Parties have delivered, or will upon request of the Administrative Agent
deliver, true, correct and complete copies of such Material Contracts to the
Administrative Agent on or before the date hereof. The Loan Parties 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.

5.25. Casualty. Neither the businesses nor the properties of any Loan Party or
any of its Subsidiaries are affected by any fire, explosion, accident, strike,
lockout or other labor dispute, drought, storm, hail, earthquake, embargo, act
of God or of the public enemy or other casualty (whether or not covered by
insurance) that, either individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.

ARTICLE VI

AFFIRMATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or other
Obligation hereunder shall remain unpaid or unsatisfied (other than contingent
indemnification obligations for which a claim has not been asserted), or any
Letter of Credit shall remain outstanding, the Loan Parties shall, and shall
(except in the case of the covenants set forth in Sections 6.01, 6.02, and 6.03)
cause each Subsidiary to:

6.01. Financial Statements. Deliver to the Administrative Agent, in form and
detail satisfactory to the Administrative Agent:

(a) as soon as available, but in any event within ninety (90) days after the end
of each Fiscal Year of the Lead Borrower (commencing with the Fiscal Year ended
January 31, 2012), a Consolidated balance sheet of the Lead Borrower and its
Subsidiaries as at the end of such Fiscal Year, and the related Consolidated
statements of income or operations, Shareholders’ Equity and cash flows for such
Fiscal Year, setting forth in each case in comparative form the figures for the
previous Fiscal Year, all in reasonable detail and prepared in accordance with
GAAP, audited and accompanied by a report and unqualified opinion of a
Registered Public Accounting Firm of nationally recognized standing reasonably
acceptable to the Administrative Agent, which report and opinion shall be
prepared in accordance with generally accepted auditing standards and shall not
be subject to any “going concern” or like qualification or exception or any
qualification or exception as to the scope of such audit;

 

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(b) 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 the Lead
Borrower (commencing with the Fiscal Quarter ended October 31, 2011), an
unaudited Consolidated balance sheet of the Lead Borrower and its Subsidiaries
as at the end of such Fiscal Quarter, and the related Consolidated statements of
income or operations, Shareholders’ Equity and cash flows for such Fiscal
Quarter and for the portion of the Lead Borrower’s Fiscal Year then ended,
setting forth in each case in comparative form the figures for (A) such period
set forth in the projections delivered pursuant to Section 6.01(d) hereof,
(B) the corresponding Fiscal Quarter of the previous Fiscal Year and (C) the
corresponding portion of the previous Fiscal Year, all in reasonable detail,
certified by a Responsible Officer of the Lead Borrower as fairly presenting the
financial condition, results of operations, Shareholders’ Equity and cash flows
of the Lead Borrower and its Subsidiaries as of the end of such Fiscal Quarter
in accordance with GAAP, subject only to normal year-end audit adjustments and
the absence of footnotes and to be certified by a Responsible Officer of the
Lead Borrower to the effect that such statements are fairly stated in all
material respects when considered in relation to the Consolidated financial
statements of the Lead Borrower and its Subsidiaries;

(c) as soon as available, but in any event within (x) thirty (30) days after the
end of each of the Fiscal Months of each fiscal year of the Lead Borrower (other
than a Fiscal Month that coincides with a Fiscal Quarter end) and (y) forty-five
(45) days after the end of each of the Fiscal Months of each fiscal year of the
Lead Borrower that coincides with a Fiscal Quarter end (commencing with the
Fiscal Month ended October 30, 2011), an unaudited Consolidated balance sheet of
the Lead Borrower and its Subsidiaries as at the end of such Fiscal Month, and
the related Consolidated statements of income or operations, Shareholders’
Equity and cash flows for such Fiscal Month, and for the portion of the Lead
Borrower’s Fiscal Year then ended, setting forth in each case in comparative
form the figures for (A) such period set forth in the projections delivered
pursuant to Section 6.01(d) hereof, (B) the corresponding Fiscal Month of the
previous Fiscal Year and (C) the corresponding portion of the previous fiscal
year, all in reasonable detail, certified by a Responsible Officer of the Lead
Borrower as fairly presenting the financial condition, results of operations,
Shareholders’ Equity and cash flows of the Lead Borrower and its Subsidiaries as
of the end of such Fiscal Month in accordance with GAAP, subject only to normal
year-end audit adjustments and the absence of footnotes, certified by a
Responsible Officer of the Lead Borrower to the effect that such statements are
fairly stated in all material respects when considered in relation to the
Consolidated financial statements of the Lead Borrower and its Subsidiaries;

(d) (i) as soon as available, but in any event at least fifteen (15) days before
the end of each Fiscal Year of the Lead Borrower, a draft of forecasts prepared
by management of the Lead Borrower which have not been approved by the board of
directors of Lead Borrower (with such forecasts in final form as approved by the
board of directors of Lead Borrower being delivered no later than five
(5) Business Days after the end of each Fiscal Year of the Lead Borrower), in
form satisfactory to the Administrative Agent, consisting of (A) Consolidated
balance sheets and statements of income or operations and cash flows of the Lead
Borrower and its Subsidiaries on a monthly basis for the immediately following
Fiscal Year (including the Fiscal Year in which the Maturity Date occurs),
provided, that, so long as there are any Loans outstanding, such Consolidated
balance sheets shall be delivered to the Administrative Agent on a quarterly
basis, and if there are no Loans outstanding, then such Consolidated balance
sheets shall be delivered to the Administrative Agent solely on an annual basis,
as provided above in this clause (i), and (B) an Excess Availability model on a
quarterly basis for the immediately following Fiscal Year (including the Fiscal
Year in which the Maturity Date occurs), in form satisfactory to the
Administrative Agent, and (ii) as soon as available, any significant revisions
to such forecasts delivered pursuant to this Section 6.01(d).

6.02. Certificates; Other Information. Deliver to the Administrative Agent, in
form and detail satisfactory to the Administrative Agent:

(a) [Reserved];

 

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(b) concurrently with the delivery of the financial statements referred to in
Sections 6.01(a) and (c) (commencing with the delivery of the financial
statements for the Fiscal Month ended October 30, 2011), a duly completed
Compliance Certificate signed by a Responsible Officer of the Lead Borrower ,
and in the event of any change in generally accepted accounting principles used
in the preparation of such financial statements, the Lead Borrower shall also
provide a statement of reconciliation conforming such financial statements to
GAAP;

(c) on the fifteenth (15th) day of each Fiscal Quarter (or, if such day is not a
Business Day, on the next succeeding Business Day), a certificate in the form of
Exhibit F (a “Borrowing Base Certificate”) showing the Borrowing Base as of the
close of business as of the last day of the immediately preceding Fiscal Quarter
(as applicable), each Borrowing Base Certificate to be certified as complete and
correct by a Responsible Officer of the Lead Borrower; provided that, (i) at any
time that an Accelerated Borrowing Base Monthly Delivery Event has occurred and
is continuing, at the election of the Administrative Agent, such Borrowing Base
Certificate shall be delivered on the tenth (10th) day of each Fiscal Month,
commencing with the first Fiscal Month following the Fiscal Month during which
such Accelerated Borrowing Base Monthly Delivery Event first occurred (or, if
the tenth (10th) day of any Fiscal Month is not a Business Day, on the next
succeeding Business Day), as of the close of business as of the last day of the
immediately preceding Fiscal Month, and (ii) at any time that an Accelerated
Borrowing Base Weekly Delivery Event has occurred and is continuing, at the
election of the Administrative Agent, such Borrowing Base Certificate shall be
delivered on Wednesday of each week, commencing with the first week following
the week during which such Accelerated Borrowing Base Weekly Delivery Event
first occurred (or, if Wednesday of any week is not a Business Day, on the next
succeeding Business Day), as of the close of business on Friday of the
immediately preceding week;

(d) promptly upon receipt, copies of any detailed audit reports, management
letters or recommendations submitted to the board of directors (or the audit
committee of the board of directors) of any Loan Party by its Registered Public
Accounting Firm in connection with the accounts or books of the Loan Parties or
any Subsidiary, or any audit of any of them, including, without limitation,
specifying any Internal Control Event;

(e) promptly after the same are available, copies of each annual report, proxy
or financial statement or other report or communication sent to the stockholders
of the Loan Parties, and copies of all annual, regular, periodic and special
reports and registration statements which any Loan Party may file or be required
to file with the SEC under Section 13 or 15(d) of the Securities Exchange Act of
1934 or with any national securities exchange, and in any case not otherwise
required to be delivered to the Administrative Agent pursuant hereto;

(f) the financial and collateral reports described on Schedule 6.02 hereto, at
the times set forth in such Schedule;

(g) promptly after the furnishing thereof, copies of any statement or report
furnished to any holder of debt securities of any Loan Party or any Subsidiary
thereof pursuant to the terms of any indenture, loan or credit or similar
agreement and not otherwise required to be furnished to the Lenders pursuant to
Section 6.01 or any other clause of this Section 6.02;

(h) as soon as available, but in any event within 30 days after the end of each
fiscal year of the Loan Parties, a report summarizing the insurance coverage
(specifying type, amount and carrier) in effect for each Loan Party and its
Subsidiaries and containing such additional information as the Administrative
Agent, or any Lender through the Administrative Agent, may reasonably specify;

 

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(i) promptly after the Administrative Agent’s request therefor, copies of all
Material Contracts and documents evidencing Material Indebtedness;

(j) promptly, and in any event within five Business Days after receipt thereof
by any Loan Party or any Subsidiary thereof, copies of each notice or other
correspondence received from any Governmental Authority (including, without
limitation, the SEC (or comparable agency in any applicable non-U.S.
jurisdiction)) concerning any proceeding with, or investigation or possible
investigation or other inquiry by such Governmental Authority regarding
financial or other operational results of any Loan Party or any Subsidiary
thereof or any other matter which, if adversely determined, could reasonably
expected to have a Material Adverse Effect; and

(k) promptly, such additional information regarding the business affairs,
financial condition or operations of any Loan Party or any Subsidiary, or
compliance with the terms of the Loan Documents, as the Administrative Agent or
any Lender may from time to time reasonably request.

Documents required to be delivered pursuant to Section 6.01(a), (b), or (c) or
Section 6.02(d) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Lead Borrower posts such documents, or provides a link thereto on the Lead
Borrower’s website on the Internet at the website address listed on Schedule
10.02; or (ii) on which such documents are posted on the Lead Borrower’s behalf
on an Internet or intranet website, if any, to which each Lender and the
Administrative Agent have access (whether a commercial, third-party website or
whether sponsored by the Administrative Agent); provided that: (i) the Lead
Borrower shall deliver paper copies of such documents to the Administrative
Agent or any Lender that requests the Lead Borrower to deliver such paper copies
until a written request to cease delivering paper copies is given by the
Administrative Agent or such Lender and (ii) the Lead Borrower shall notify the
Administrative Agent and each Lender (by telecopier or electronic mail) of the
posting of any such documents and provide to the Administrative Agent by
electronic mail electronic versions (i.e., soft copies) of such documents.
Notwithstanding anything contained herein, in every instance the Lead Borrower
shall be required to provide paper copies of the Compliance Certificates
required by Section 6.02(b) to the Administrative Agent. The Administrative
Agent shall have no obligation to request the delivery or to maintain copies of
the documents referred to above, and in any event shall have no responsibility
to monitor compliance by the Loan Parties with any such request for delivery,
and each Lender shall be solely responsible for requesting delivery to it or
maintaining its copies of such documents.

The Loan Parties hereby acknowledge that (a) the Administrative Agent and/or the
Arranger will make available to the Lenders and the LC Issuer materials and/or
information provided by or on behalf of the Loan Parties hereunder
(collectively, “Borrower Materials”) by posting the Borrower Materials on
IntraLinks or another similar electronic system (the “Platform”) and (b) 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 the Loan Parties or
their securities) (each, a “Public Lender”). The Loan Parties hereby agree that
so long as any Loan Party is the issuer of any outstanding debt or equity
securities that are registered or issued pursuant to a private offering or is
actively contemplating issuing any such securities, they will use commercially
reasonable efforts to identify that portion of the Borrower Materials that may
be distributed to the Public Lenders and that (w) all such Borrower Materials
shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall
mean that the word “PUBLIC” shall appear prominently on the first page thereof;
(x) by marking Borrower Materials “PUBLIC,” the Loan Parties shall be deemed to
have authorized the Administrative Agent, the Arranger, the LC Issuer and the
Lenders to treat such Borrower Materials as not containing any material
non-public information (although it may be sensitive and proprietary) with
respect to the Loan Parties or their securities for purposes of United States
Federal and state securities laws (provided, however, that to the extent such
Borrower

 

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Materials constitute Information, they shall be treated as set forth in
Section 10.07); (y) all Borrower Materials marked “PUBLIC” are permitted to be
made available through a portion of the Platform designated “Public Investor”;
and (z) the Administrative Agent and the Arranger shall be entitled to treat any
Borrower Materials that are not marked “PUBLIC” as being suitable only for
posting on a portion of the Platform not designated “Public Investor.”

6.03. Notices. Promptly notify the Administrative Agent:

(a) of the occurrence of any Default or Event of Default;

(b) of any matter that has resulted or could reasonably be expected to result in
a Material Adverse Effect, including (i) breach or non-performance of, or any
default under, a Material Contract or with respect to Material Indebtedness of
any Loan Party or any Subsidiary thereof; (ii) any dispute, litigation,
investigation, proceeding or suspension between any Loan Party or any Subsidiary
thereof and any Governmental Authority (any of the foregoing described in this
clause (ii) being referred to herein as “Governmental Litigation”); or (iii) the
commencement of, or any material development in, any litigation or proceeding
affecting any Loan Party or any Subsidiary thereof, including pursuant to any
applicable Environmental Laws; provided, that, solely in the case of any
Governmental Litigation with respect to which the potential liability of Loan
Parties in connection therewith does not exceed $100,000 and all litigation or
proceedings which are not Governmental Litigation, the delivery by Loan Parties
to Agent, no less frequently than once each Fiscal Quarter, of Loan Parties’
litigation status report prepared by Loan Parties’ general counsel shall satisfy
Loan Parties’ obligations under this clause (b)

(c) of the occurrence of any ERISA Event;

(d) of any material change in accounting policies or financial reporting
practices by any Loan Party or any Subsidiary thereof;

(e) of any change in any Loan Party’s senior executive officers;

(f) of the discharge by any Loan Party of its present Registered Public
Accounting Firm or any withdrawal or resignation by such Registered Public
Accounting Firm;

(g) [Reserved];

(h) of the filing of any Lien for unpaid Taxes against any Loan Party in excess
of $500,000;

(i) of any casualty or other insured damage to any material portion of the
Collateral or the commencement of any action or proceeding for the taking of any
interest in a material portion of the Collateral under power of eminent domain
or by condemnation or similar proceeding or if any material portion of the
Collateral is damaged or destroyed;

(j) of any transaction of the nature contained in ARTICLE VII hereof, occurring
after the Closing Date, including, without limitation, (i) the entry by a Loan
Party into a Material Contract, (ii) the incurrence by a Loan Party of Material
Indebtedness, (iii) the voluntary or involuntary grant of any Lien upon any
property of a Loan Party; or (iv) the making of any Investments by a Loan Party,
provided, that, Loan Parties shall have no obligation to notify the
Administrative Agent of the occurrence of any Disposition unless a Prepayment
Event shall occur in connection therewith; and

 

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(k) of any failure by any Loan Party to pay rent at (i) five (5%) or more of
such Loan Party’s locations or (ii) any of such Loan Party’s locations if such
failure continues for more than ten (10) days following the day on which such
rent first came due and such failure would be reasonably likely to result in a
Material Adverse Effect.

Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer of the Lead Borrower setting forth details of the occurrence
referred to therein and stating what action the Lead Borrower has taken and
proposes to take with respect thereto.

6.04. Payment of Obligations. Pay and discharge as the same shall become due and
payable, all its obligations and liabilities, including (a) all tax liabilities,
assessments and governmental charges or levies upon it or its properties or
assets, (b) all lawful claims (including, without limitation, claims of
landlords, warehousemen, freight forwarders, and carriers) which, if unpaid,
would by law become a Lien upon its property; and (c) all Indebtedness, as and
when due and payable, but subject to any subordination provisions contained in
any instrument or agreement evidencing such Indebtedness, except, in each case,
where (a) the validity or amount thereof is being contested in good faith by
appropriate proceedings, (b) such Loan Party has set aside on its books adequate
reserves with respect thereto in accordance with GAAP, (c) such contest
effectively suspends collection of the contested obligation and enforcement of
any Lien securing such obligation, (c) no Lien has been filed with respect
thereto and (d) the failure to make payment pending such contest could not
reasonably be expected to result in a Material Adverse Effect. Nothing contained
herein shall be deemed to limit the rights of the Administrative Agent with
respect to determining Availability Reserves pursuant to this Agreement.

6.05. Preservation of Existence, Etc. (a) Preserve, renew and maintain in full
force and effect its legal existence and good standing under the Laws of the
jurisdiction of its organization or formation except in a transaction permitted
by Section 7.04 or 7.05; (except, in the case of failure to maintain good
standing, to the extent promptly cured or as otherwise could not reasonably be
expected to have a Material Adverse Effect); (b) take all reasonable action to
maintain all rights, privileges, permits, licenses and franchises necessary or
desirable in the normal conduct of its business, except to the extent that
failure to do so could not reasonably be expected to have a Material Adverse
Effect; and (c) preserve or renew all of its Intellectual Property, except to
the extent failure to do so could not reasonably be expected to have a Material
Adverse Effect.

6.06. Maintenance of Properties. (a) Maintain, preserve and protect all of its
material properties and equipment necessary in the operation of its business in
good working order and condition, ordinary wear and tear excepted; and (b) make
all necessary repairs thereto and renewals and replacements thereof, except, in
each case, where the failure to do so could not reasonably be expected to have a
Material Adverse Effect.

6.07. Maintenance of Insurance. Maintain with financially sound and reputable
insurance companies reasonably acceptable to the Administrative Agent which are
not Affiliates of the Loan Parties, insurance with respect to its properties and
business against loss or damage of the kinds customarily insured against by
Persons engaged in the same or similar business and operating in the same or
similar locations or as is required by applicable Law, of such types and in such
amounts (after giving effect to any self-insurance compatible with the following
standards) as are customarily carried under similar circumstances by such other
Persons and as are reasonably acceptable to the Administrative Agent.

(a) Cause fire and extended coverage policies maintained with respect to any
Collateral to be endorsed or otherwise amended to include (i) a non-contributing
mortgage clause (regarding improvements to real property) and lenders’ loss
payable clause (regarding personal property), in form and substance reasonably
satisfactory to the Administrative Agent, which endorsements or

 

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amendments shall provide that the insurer shall make all payments of proceeds
payable under the policies to both the Loan Parties and the Administrative
Agent, provided, that, the Loan Parties shall promptly remit to the
Administrative Agent any such proceeds that may be delivered directly to the
Loan Parties, for application to the Obligations in accordance with and subject
to the terms of this Agreement, (ii) a provision to the effect that none of the
Loan Parties, Credit Parties or any other Person shall be a co-insurer and
(iii) such other provisions as the Administrative Agent may reasonably require
from time to time to protect the interests of the Credit Parties.

(b) Cause commercial general liability policies to be endorsed to name the
Administrative Agent as an additional insured.

(c) Cause business interruption policies to name the Administrative Agent as a
loss payee and to be endorsed or amended to include (i) a provision to the
effect that none of the Loan Parties, the Administrative Agent, or any other
party shall be a co insurer and (ii) such other provisions as the Administrative
Agent may reasonably require from time to time to protect the interests of the
Credit Parties. Notwithstanding the foregoing, so long as no Cash Dominion Event
shall have occurred and be continuing at any time that proceeds become payable
under any business interruption policies of Loan Parties, Administrative Agent
shall (x) permit the Loan Parties to use all such business interruption
insurance proceeds for any purpose permitted under this Agreement and (y) remit
to the Loan Parties any amounts received by Administrative Agent as a loss payee
under such business interruption insurance maintained by the Loan Parties. If a
Cash Dominion Event has occurred and is continuing, the Loan Parties shall remit
to the Administrative Agent an amount equal to such proceeds (if the
Administrative Agent has not received same) and the Administrative Agent is
hereby authorized to collect all business interruption insurance directly and to
apply such proceeds to the payment of the then outstanding Obligations.

(d) Cause each such policy referred to in this Section 6.07 to also provide that
it shall not be canceled, modified or not renewed (i) by reason of nonpayment of
premium except upon not less than ten (10) days’ prior written notice thereof by
the insurer to the Administrative Agent (giving the Administrative Agent the
right to cure defaults in the payment of premiums) or (ii) for any other reason
except upon not less than thirty (30) days’ prior written notice thereof by the
insurer to the Administrative Agent.

(e) Deliver to the Administrative Agent, prior to the cancellation, modification
or non-renewal of any such policy of insurance, a copy of a renewal or
replacement policy (or other evidence of renewal of a policy previously
delivered to the Administrative Agent, including an insurance binder) together
with evidence satisfactory to the Administrative Agent of payment of the premium
therefor.

(f) [Reserved].

(g) Maintain for themselves and their Subsidiaries, a Directors and Officers
insurance policy, and a “Blanket Crime” policy including employee dishonesty,
forgery or alteration, theft, disappearance and destruction, robbery and safe
burglary, property, and computer fraud coverage with responsible companies in
such amounts as are customarily carried by business entities engaged in similar
businesses similarly situated, and will upon request by the Administrative Agent
furnish the Administrative Agent certificates evidencing renewal of each such
policy.

(h) Permit any representatives that are designated by the Administrative Agent
to inspect the insurance policies maintained by or on behalf of the Loan Parties
and to inspect books and records related thereto and any properties covered
thereby.

 

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None of the Credit Parties, or their agents or employees shall be liable for any
loss or damage insured by the insurance policies required to be maintained under
this Section 6.07. Each Loan Party shall look solely to its insurance companies
or any other parties other than the Credit Parties for the recovery of such loss
or damage and such insurance companies shall have no rights of subrogation
against any Credit Party or its agents or employees. If, however, the insurance
policies do not provide waiver of subrogation rights against such parties, as
required above, then the Loan Parties hereby agree, to the extent permitted by
law, to waive their right of recovery, if any, against the Credit Parties and
their agents and employees. The designation of any form, type or amount of
insurance coverage by any Credit Party under this Section 6.07 shall in no event
be deemed a representation, warranty or advice by such Credit Party that such
insurance is adequate for the purposes of the business of the Loan Parties or
the protection of their properties.

6.08. Compliance with Laws. Comply in all material respects with the
requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its business or property, except in such instances in
which (a) such requirement of Law or order, writ, injunction or decree is being
contested in good faith by appropriate proceedings diligently conducted and with
respect to which adequate reserves have been set aside and maintained by the
Loan Parties in accordance with GAAP, or (b) the failure to comply therewith
could not reasonably be expected to have a Material Adverse Effect.

6.09. Books and Records; Accountants.

(a) Maintain proper books of record and account, in which full, true and correct
entries in conformity with GAAP consistently applied shall be made of all
financial transactions and matters involving the assets and business of the Loan
Parties or such Subsidiary, as the case may be; and (ii) maintain such books of
record and account in material conformity with all applicable requirements of
any Governmental Authority having regulatory jurisdiction over the Loan Parties
or such Subsidiary, as the case may be.

(b) At all times retain a Registered Public Accounting Firm which is reasonably
satisfactory to the Administrative Agent and instruct such Registered Public
Accounting Firm to cooperate with, and be available to, as reasonably requested
by the Administrative Agent or its representatives to discuss the Loan Parties’
financial performance, financial condition, operating results, controls, and
such other matters, within the scope of the retention of such Registered Public
Accounting Firm, as may be raised by the Administrative Agent.

6.10. Inspection Rights.

(a) Permit representatives and independent contractors of the Administrative
Agent to visit and inspect any of its properties, to examine its corporate,
financial and operating records, and make copies thereof or abstracts therefrom,
and to discuss its affairs, finances and accounts with its directors, officers,
and Registered Public Accounting Firm, all at the expense of the Loan Parties
and at such reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to the Lead Borrower;
provided, that, when an Event of Default exists the Administrative Agent (or any
of its representatives or independent contractors) may do any of the foregoing
at the expense of the Loan Parties at any time during normal business hours and
without advance notice.

(b) Upon the request of the Administrative Agent after reasonable prior notice,
permit the Administrative Agent or professionals (including investment bankers,
consultants, accountants, and lawyers) retained by the Administrative Agent to
conduct field examinations and other evaluations, including, without limitation,
of (i) the Lead Borrower’s practices in the computation of the Borrowing

 

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Base, (ii) the assets included in the Borrowing Base and related financial
information such as, but not limited to, sales, gross margins, payables,
accruals and reserves, and (iii) the Loan Parties’ business plan and cash flows.
So long as there are no Credit Extensions outstanding hereunder at any time
during any Fiscal Year, Loan Parties shall not be obligated to pay the fees and
expenses of the Administrative Agent and such professionals with respect to such
examinations and evaluations during such Fiscal Year. If, however, there are any
Loans outstanding hereunder at any time during any Fiscal Year and Excess
Availability is not, at all times while such Loans are outstanding, at least
equal to the amount equal to the greater of (A) Fifty Million Dollars
($50,000,000) or (B) fifty percent (50%) of the Loan Cap (such amount, the “50%
Excess Availability”), then the Loan Parties acknowledge that the Administrative
Agent may, in its discretion, undertake one (1) field examination during such
Fiscal Year at the Loan Parties’ expense; provided, that, (1) if Excess
Availability is less than the 50% Excess Availability at any time while such
Loans are outstanding, but at all times exceeds while such Loans are outstanding
the amount equal to the greater of (x) Fifteen Million Dollars ($15,000,000) or
(y) fifteen percent (15%) of the Loan Cap (such amount, the “15% Excess
Availability”), then the Loan Parties acknowledge that the Administrative Agent
may, in its discretion, undertake up to two (2) field examination during such
Fiscal Year at the Loan Parties’ expense, and (2) if Excess Availability is less
than the 15% Excess Availability at any time while such Loans are outstanding,
then the Loan Parties acknowledge that the Administrative Agent may, in its
discretion, undertake such field examination during such Fiscal Year as the
Administrative Agent in its discretion deems necessary or appropriate. all at
the Loan Parties’ expense. Notwithstanding the foregoing, the Administrative
Agent may cause additional field examinations to be undertaken (i) as it in its
discretion deems necessary or appropriate, at its own expense or, (ii) if
required by Law or if a Default or Event of Default shall have occurred and be
continuing, at the expense of the Loan Parties.

(c) Upon the request of the Administrative Agent after reasonable prior notice,
permit the Administrative Agent or professionals (including appraisers) retained
by the Administrative Agent to conduct appraisals of the Collateral, including,
without limitation, the assets included in the Borrowing Base. So long as there
are no Credit Extensions outstanding hereunder at any time during any Fiscal
Year, Loan Parties shall not be obligated to pay the fees and expenses of the
Administrative Agent and such professionals with respect to such appraisals
during such Fiscal Year. If, however, there are any Loans outstanding hereunder
at any time during any Fiscal Year and Excess Availability is not, at all times
while such Loans are outstanding, at least equal to the 50% Excess Availability,
then the Loan Parties acknowledge that the Administrative Agent may, in its
discretion, undertake one (1) appraisal during such Fiscal Year at the Loan
Parties’ expense; provided, that, (A) if Excess Availability is less than the
50% Excess Availability at any time while such Loans are outstanding, but at all
times exceeds while such Loans are outstanding the amount equal to the 15%
Excess Availability, then the Loan Parties acknowledge that the Administrative
Agent may, in its discretion, undertake up to two (2) appraisals during such
Fiscal Year at the Loan Parties’ expense, and (B) if Excess Availability is less
than the 15% Excess Availability at any time while such Loans are outstanding,
then the Loan Parties acknowledge that the Administrative Agent may, in its
discretion, undertake such appraisals during such Fiscal Year as the
Administrative Agent in its discretion deems necessary or appropriate. all at
the Loan Parties’ expense. Notwithstanding the foregoing, the Administrative
Agent may cause additional appraisals to be undertaken (1) as it in its
discretion deems necessary or appropriate, at its own expense or, (2) if
required by Law or if a Default or Event of Default shall have occurred and be
continuing, at the expense of the Loan Parties.

6.11. Use of Proceeds. Use the proceeds of the Credit Extensions (a) to finance
the acquisition of working capital assets of the Borrowers, including the
purchase of inventory and equipment, in each case in the ordinary course of
business, (b) to finance Capital Expenditures of the Borrowers, and (c) for
general corporate purposes of the Loan Parties, in each case to the extent
expressly permitted under applicable Law and the Loan Documents.

 

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6.12. Additional Loan Parties. Notify the Administrative Agent at the time that
any Person becomes a Subsidiary, and promptly thereafter (and in any event
within fifteen (15) days), cause any such Person (a) which is not a CFC, to
(i) become a Loan Party by executing and delivering to the Administrative Agent
a Joinder Agreement or a counterpart of the Facility Guaranty or such other
document as the Administrative Agent shall deem appropriate for such purpose,
(ii) grant a Lien to the Administrative Agent on such Person’s assets of the
type included in the Collateral to secure the Obligations, and (iii) deliver to
the Administrative Agent documents of the types referred to in clauses (iii) and
(iv) of Section 4.01(a) and favorable opinions of counsel to such Person (which
shall cover, among other things, the legality, validity, binding effect and
enforceability of the documentation referred to in clause (a)), and (b) if any
Equity Interests or Indebtedness of such Person are owned by or on behalf of any
Loan Party, to pledge such Equity Interests and promissory notes evidencing such
Indebtedness (except that, if such Subsidiary is a CFC, the Equity Interests of
such Subsidiary to be pledged may be limited to sixty-five percent (65%) of the
outstanding voting Equity Interests of such Subsidiary and one hundred percent
(100%) of the non-voting Equity Interests of such Subsidiary and such time
period may be extended based on local law or practice), in each case in form,
content and scope reasonably satisfactory to the Administrative Agent. In no
event shall compliance with this Section 6.12 waive or be deemed a waiver or
Consent to any transaction giving rise to the need to comply with this
Section 6.12 if such transaction was not otherwise expressly permitted by this
Agreement or constitute or be deemed to constitute, with respect to any
Subsidiary, an approval of such Person as a Borrower or permit the inclusion of
any acquired assets in the computation of the Borrowing Base.

6.13. Cash Management.

(a) On or prior to the Closing Date:

(i) deliver to the Administrative Agent copies of notifications (each, a “DDA
Notification”) substantially in the form attached hereto as Exhibit H which have
been executed on behalf of such Loan Party and delivered to each depository
institution listed on Schedule 5.21(a);

(ii) deliver to the Administrative Agent copies of notifications (each, a
“Credit Card Notification”) substantially in the form attached hereto as Exhibit
I which have been executed on behalf of such Loan Party and delivered to such
Loan Party’s credit card clearinghouses and processors listed on Schedule
5.21(b); provided, that, Lead Borrower may amend Schedule 5.21(b) to add
additional Credit Card Issuers and Credit Card Processors, so long as such
amendment occurs by written notice delivered to Agent promptly after the date on
which the applicable Loan Party enters into a new Credit Card Agreement after
the Closing Date, accompanied by a copy of the Credit Card Notification
delivered to each new Credit Card Issuer and/or Credit Card Processor which is
identified in such amendment; and

(iii) enter into a Blocked Account Agreement satisfactory in form and substance
to the Administrative Agent with each Blocked Account Bank (collectively, the
“Blocked Accounts”).

(b) The Loan Parties shall ACH or wire transfer no less frequently than daily
(and whether or not there are then any outstanding Obligations) to a Blocked
Account all amounts on deposit in each such DDA and all payments due from Credit
Card Processors and Credit Card Issuers; provided, however, that the Loan
Parties may leave up to $5,000 on deposit in each DDA.

(c) Each Blocked Account Agreement shall require, after the occurrence and
during the continuance of a Cash Dominion Event, that such bank transfer no less
frequently than daily (and whether or not there are then any outstanding
Obligations) to the concentration account maintained by the Administrative Agent
at Wells Fargo (the “Concentration Account”), all cash receipts and collections,
including, without limitation, the following:

(i) all available cash receipts from the sale of Inventory and other assets
(whether or not constituting Collateral);

 

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(ii) all proceeds of collections of Accounts;

(iii) all Net Proceeds, and all other cash payments received by a Loan Party
from any Person or from any source or on account of any sale or other
transaction or event, including, without limitation, any Prepayment Event;

(iv) the then contents of each DDA (net of any minimum balance, not to exceed
$2,500.00, as may be required to be kept in the subject DDA by the depository
institution at which such DDA is maintained);

(v) the then entire ledger balance of each Blocked Account (net of any minimum
balance, not to exceed $2,500.00, as may be required to be kept in the subject
Blocked Account by the Blocked Account Bank); and

(vi) the proceeds of all credit card charges.

(d) The Concentration Account shall at all times be under the sole dominion and
control of the Administrative Agent. The Loan Parties hereby acknowledge and
agree that (i) the Loan Parties have no right of withdrawal from the
Concentration Account, (ii) the funds on deposit in the Concentration Account
shall at all times be collateral security for all of the Obligations and
(iii) the funds on deposit in the Concentration Account shall be applied as
provided in this Agreement.

(e) All funds received in the Agent Payment Account shall be applied to the
Obligations as provided in accordance with Section 8.03 of this Agreement and
without regard to whether the Administrative Agent is exercising remedies
provided for in Section 8.02 following the occurrence and during the continuance
of an Event of Default. In the event that, notwithstanding the provisions of
this Section 6.13, any Loan Party receives or otherwise has dominion and control
of any such proceeds or collections, such proceeds and collections shall be held
in trust by such Loan Party for the Administrative Agent, shall not be
commingled with any of such Loan Party’s other funds or deposited in any account
of such Loan Party and shall, not later than the Business Day after receipt
thereof, be deposited into the Concentration Account or dealt with in such other
fashion as such Loan Party may be instructed by the Administrative Agent.

(f) Upon the request of the Administrative Agent, the Loan Parties shall cause
bank statements and/or other reports to be delivered to the Administrative Agent
not less often than monthly, accurately setting forth all amounts deposited in
each Blocked Account to ensure the proper transfer of funds as set forth above.

(g) Without limiting the generality of Sections 6.13(a) through 6.13(f) above,
upon the occurrence and during the continuance of a Cash Dominion Event (and not
prior thereto), Administrative Agent shall have the right to direct (i) each
depository institution listed on Schedule 5.21(a), (ii) each bank that is party
to a Blocked Account Agreement (subject to the terms of such Blocked Account
Agreement), and (iii) each Credit Card Processor and Credit Card Issuer which
then acts as a credit card clearinghouse and/or processor for any Loan Party to,
in each case, remit to the Concentration Account (or such other account as
Administrative Agent may direct), all monies on deposit in the applicable bank
accounts, no less frequently than daily, and all payments payable to a Loan
Party by such Credit Card Processor or Credit Card Issuer, as and when payable
to such Loan Party.

 

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6.14. Information Regarding the Collateral.

(a) Furnish to the Administrative Agent at least thirty (30) days prior written
notice of any change in: (i) any Loan Party’s name or in any trade name used to
identify it in the conduct of its business or in the ownership of its
properties; (ii) the location of any Loan Party’s chief executive office, its
principal place of business, any office in which it maintains books or records
relating to Collateral owned by it or any office or facility at which Collateral
in excess of $500,000 in the aggregate owned by it is located (including the
establishment of any such new office or facility); (iii) any Loan Party’s
organizational structure or jurisdiction of incorporation or formation; or
(iv) any Loan Party’s Federal Taxpayer Identification Number or organizational
identification number assigned to it by its state of organization. The Loan
Parties agree not to effect or permit any change referred to in the preceding
sentence unless all filings have been made under the UCC or otherwise that are
required in order for the Administrative Agent to continue at all times
following such change to have a valid, legal and perfected first priority
security interest in all the Collateral for its own benefit and the benefit of
the other Credit Parties. Notwithstanding anything to the contrary contained in
Section 6.14(a)(ii) above, (x) the delivery to the Administrative Agent of the
Inventory summary by Store location and the Statement of Store Activity report
under Schedule 6.02, Sections (b)(ii) and (c)(iii) thereof shall satisfy the
Loan Parties’ obligation set forth in Section 6.14(a)(ii) above to provide
written notice of any Inventory that is at any time delivered to any new Store
locations, and (y) the delivery to the Administrative Agent of a Borrowing Base
Certificate, together with supporting source documents for the Borrowing Base
Certificate under Schedule 6.02, Section (a)(i) thereof, evidencing that
Inventory located at a new Store, a new warehouse or any other new facility that
was previously reported to the Administrative Agent as Eligible Inventory has
been, as a result of its location at any such new facility, expressly removed
from Eligible Inventory and is not included within the Borrowing Base, shall
satisfy the Loan Parties’ obligation set forth in Section 6.14(a)(ii) above to
provide written notice of any Inventory that is at any time delivered to a new
facility. In addition to, and not in limitation of, the criteria for Eligible
Inventory set forth in the definition thereof, no Inventory that becomes located
at a new Store, a new warehouse or any other new facility shall constitute
Eligible Inventory if Loan Parties have not satisfied their obligations under
Section 6.14(a)(ii) above with respect to such new Inventory location.

(b) Should any of the information on any of the Schedules hereto become
inaccurate or misleading in any material respect as a result of changes after
the Closing Date, the Lead Borrower shall advise the Administrative Agent in
writing of such revisions or updates as may be necessary or appropriate to
update or correct the same. From time to time as may be reasonably requested by
the Administrative Agent, the Lead Borrower shall supplement each Schedule
hereto, or any representation herein or in any other Loan Document, with respect
to any matter arising after the Closing Date that, if existing or occurring on
the Closing Date, would have been required to be set forth or described in such
Schedule or as an exception to such representation or that is necessary to
correct any information in such Schedule or representation which has been
rendered inaccurate thereby (and, in the case of any supplements to any
Schedule, such Schedule shall be appropriately marked to show the changes made
therein). Notwithstanding the foregoing, no supplement or revision to any
Schedule or representation shall be deemed the Credit Parties’ consent to the
matters reflected in such updated Schedules or revised representations nor
permit the Loan Parties to undertake any actions otherwise prohibited hereunder
or fail to undertake any action required hereunder from the restrictions and
requirements in existence prior to the delivery of such updated Schedules or
such revision of a representation; nor shall any such supplement or revision to
any Schedule or representation be deemed the Credit Parties’ waiver of any
Default resulting from the matters disclosed therein.

 

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6.15. Physical Inventories.

(a) Cause not less than one (1) physical inventory to be undertaken, at the
expense of the Loan Parties, annually and in periodic cycle counts, in each case
consistent with past practices, conducted by such inventory takers as are
satisfactory to the Administrative Agent and following such methodology as is
consistent with the methodology used in the immediately preceding inventory or
as otherwise may be satisfactory to the Administrative Agent. The Administrative
Agent, at the expense of the Loan Parties, may participate in and/or observe
each scheduled physical count of Inventory which is undertaken on behalf of any
Loan Party. The Lead Borrower, within ten (10) days following the completion of
such inventory, shall provide the Administrative Agent with a reconciliation of
the results of such inventory (as well as of any other physical inventory or
cycle counts undertaken by a Loan Party) and shall post such results to the Loan
Parties’ stock ledgers and general ledgers, as applicable.

(b) Permit the Administrative Agent, in its discretion, if any Default or Event
of Default exists, to cause additional such inventories to be taken as the
Administrative Agent determines (each, at the expense of the Loan Parties).

6.16. Environmental Laws.

(a) Conduct its operations and keep and maintain its Real Estate in material
compliance with all Environmental Laws; (b) obtain and renew all material
environmental permits necessary for its operations and properties; and
(c) implement any and all investigation, remediation, removal and response
actions that are appropriate or necessary to comply in all material respects
with applicable Environmental Laws pertaining to the presence, generation,
treatment, storage, use, disposal, transportation or release of any Hazardous
Materials on, at, in, under, above, to, from or about any of its Real Estate,
provided, however, that neither a Loan Party nor any of its Subsidiaries shall
be required to undertake any such cleanup, removal, remedial or other action to
the extent that its obligation to do so is being contested in good faith and by
proper proceedings and adequate reserves have been set aside and are being
maintained by the Loan Parties with respect to such circumstances in accordance
with GAAP.

6.17. Further Assurances.

(a) Execute any and all further documents, financing statements, agreements and
instruments, and take all such further actions (including the filing and
recording of financing statements and other documents), that may be required
under any applicable Law, or which the Administrative Agent may reasonably
request, to effectuate the transactions contemplated by the Loan Documents or to
grant, preserve, protect or perfect the Liens created or intended to be created
by the Security Documents or the validity or priority of any such Lien, all at
the expense of the Loan Parties. The Loan Parties also agree to provide to the
Administrative Agent, from time to time upon request, evidence satisfactory to
the Administrative Agent as to the perfection and priority of the Liens created
or intended to be created by the Security Documents.

(b) [Reserved]

(c) [Reserved]

(d) Upon the request of the Administrative Agent, use commercially reasonable
efforts to cause each of its Freight Forwarders to deliver an agreement
(including, without limitation, a Freight Forwarder Agreement) to the
Administrative Agent covering such matters and in such form as the
Administrative Agent may reasonably require.

 

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(e) Upon the request of the Administrative Agent, cause any of its landlords to
deliver a Collateral Access Agreement to the Administrative Agent in such form
as the Administrative Agent may reasonably require.

(f) Upon the request of the Administrative Agent, deliver to the Administrative
Agent copies of each DDA Notification which have been executed on behalf of such
Loan Party and delivered to each depository institution at which a DDA is
maintained.

6.18. Compliance with Terms of Leaseholds. Except as otherwise expressly
permitted hereunder, make all payments and otherwise perform all obligations in
respect of all Leases of real property to which any Loan Party or any of its
Subsidiaries is a party, keep such Leases in full force and effect and not allow
such Leases to lapse or be terminated or any rights to renew such leases to be
forfeited or cancelled, notify the Administrative Agent of any default by any
party with respect to such Leases and cooperate with the Administrative Agent in
all respects to cure any such default, and cause each of its Subsidiaries to do
so, except in any case where the failure to do so, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.

6.19. [Reserved]. Lender Meetings. Within ninety (90) days after the close of
each Fiscal Year of the Lead Borrower, if there are two (2) or more Lenders
party to this Agreement at such time, at the request of the Administrative Agent
or of the Required Lenders and upon reasonable prior notice, hold a meeting (at
a mutually agreeable location and time or, at the option of the Administrative
Agent, by conference call) with all Lenders who choose to attend such meeting at
which meeting shall be reviewed the financial results of the previous Fiscal
Year and the financial condition of Lead Borrower and its Subsidiaries and the
projections presented for the current Fiscal Year of Lead Borrower.

6.21. [Reserved].

6.22. ERISA.

(a) Each Loan Party shall, and shall cause each of its ERISA Affiliates to:
(i) maintain each Plan in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal and applicable 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 PBGC; (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 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 presents a material risk
of termination by the PBGC of any Plan that is a single employer plan, which
termination could result in any material liability to the PBGC.

(b) Promptly upon each determination of the amount of the contributions or other
payments required to be made for any calendar year by any Loan Party in respect
of any underfunded Pension Plan in order to eliminate or reduce the funding
deficiency and prior to any Borrower or Guarantor making any contribution of
other payment in respect of such calendar year, the Lead Borrower shall notify
the Administrative Agent of such determination and provide such information with
respect thereto as the Administrative Agent may reasonably request. The
Administrative Agent may, at its option, establish a Reserve equal to the
aggregate amount of the payments required to be made in such year in

 

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order to reduce or eliminate any funding deficiency. On any date that the amount
required to be so contributed or paid is less than the amount of such Reserve,
the amount of the Reserve shall be reduced to the amount required to be so
contributed or paid, provided, that, no Default or Event of Default shall exist
or have occurred and be continuing and on any date that the amount required to
be so contributed or paid is greater than the amount of such Reserve, the amount
of such Reserve may be increased to such amount.

6.23. Post-closing Covenants.

(a) Without limiting the generality of any other Section of this Agreement
pursuant to which Loan Parties may be obligated to deliver a Collateral Access
Agreement with respect to any location leased by a Loan Party at which
Collateral may be located (including, without limitation, Section 6.17(e)), Loan
Parties shall use commercially reasonable efforts to cause the owner of the
distribution center leased by Borrowers at 8500 Bay Center Road, Jacksonville,
Florida, to execute and deliver to the Administrative Agent, on or before ninety
(90) days following the Closing Date, a Collateral Access Agreement with respect
to such distribution center. Nothing contained herein, however, shall be deemed
to limit the rights of the Administrative Agent to establish an Availability
Reserves pursuant to this Agreement with respect to Loan Parties’ rental
obligations with respect to such distribution center, until such time as the
Administrative Agent shall have received such Collateral Access Agreement.

(b) Without limiting the generality of Loan Parties’ covenants set forth in
Section 6.07, Loan Parties shall deliver to the Administrative Agent, on or
before sixty (60) days following the Closing Date, a lenders’ loss payable
endorsement, naming the Administrative Agent as lender loss payee or additional
insured (as applicable) under the various policies of insurance which Loan
Parties maintain as of the Closing Date in accordance with Section 6.07, which
shall be in form and substance reasonably satisfactory to the Administrative
Agent.

ARTICLE VII

NEGATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or other
Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding (other than contingent indemnification obligations for
which a claim has not been asserted), no Loan Party shall, nor shall it permit
any Subsidiary to, directly or indirectly:

7.01. Liens. Create, incur, assume or suffer to exist any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, except
Permitted Encumbrances.

7.02. Investments. Make any Investments, except Permitted Investments.

7.03. Indebtedness; Disqualified Stock.

(a) Create, incur, assume, guarantee, suffer to exist or otherwise become or
remain liable with respect to, any Indebtedness, except Permitted Indebtedness;
or

(b) issue Disqualified Stock.

7.04. Fundamental Changes. Merge, dissolve, liquidate, consolidate with or into
another Person, (or agree to do any of the foregoing), except that, so long as
no Default or Event of Default shall have occurred and be continuing prior to or
immediately after giving effect to any action described below or would result
therefrom:

(a) any Subsidiary which is not a Loan Party may merge with (i) a Loan Party,
provided that the Loan Party shall be the continuing or surviving Person, or
(ii) any one or more other Subsidiaries which are not Loan Parties, provided
that when any wholly-owned Subsidiary is merging with another Subsidiary, the
wholly-owned Subsidiary shall be the continuing or surviving Person;

 

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(b) any Subsidiary which is a Loan Party may merge into any Subsidiary which is
a Loan Party or into a Borrower, provided, that, in any merger involving a
Borrower, such Borrower shall be the continuing or surviving Person;

(c) in connection with a Permitted Acquisition, any Subsidiary of a Loan Party
may merge with or into or consolidate with any other Person or permit any other
Person to merge with or into or consolidate with it; provided that (i) the
Person surviving such merger shall be a wholly-owned Subsidiary of a Loan Party
and (ii) in the case of any such merger to which any Loan Party is a party, such
Loan Party is the surviving Person; and

(d) any CFC that is not a Loan Party may merge into any CFC that is not a Loan
Party.

7.05. Dispositions. Make any Disposition or enter into any agreement to make any
Disposition, except Permitted Dispositions.

7.06. Restricted Payments. Declare or make, directly or indirectly, any
Restricted Payment, or incur any obligation (contingent or otherwise) to do so,
except that, so long as no Default or Event of Default shall have occurred and
be continuing prior to or immediately after giving effect to any action
described below or would result therefrom:

(a) each Subsidiary of a Loan Party may make Restricted Payments to any Loan
Party;

(b) the Loan Parties and each Subsidiary may declare and make dividend payments
or other distributions payable solely in the common stock or other common Equity
Interests of such Person; and

(c) if the Pro Forma Availability Condition is satisfied:

(i) the Loan Parties and each Subsidiary may purchase, redeem or otherwise
acquire Equity Interests issued by it; and

(ii) the Lead Borrower may declare or pay cash dividends to its stockholders.

7.07. Prepayments of Indebtedness. Prepay, redeem, purchase, defease or
otherwise satisfy prior to the scheduled maturity thereof in any manner any
Indebtedness, or make any payment in violation of any subordination terms of any
Subordinated Indebtedness, except (a) regularly scheduled or mandatory
repayments, repurchases, redemptions or defeasances of Permitted Indebtedness
(other than Subordinated Indebtedness), so long as on the date of any such
payment and after giving effect thereto, no Default or no Event of Default then
exists, (b) repayments and prepayments of Subordinated Indebtedness in
accordance with the subordination terms thereof, so long as on the date of any
such payment and after giving effect thereto, no Default or no Event of Default
then exists, (c) voluntary prepayments, repurchases, redemptions or defeasances
of Permitted Indebtedness (but excluding on account of any Subordinated
Indebtedness) as long as the Payment Conditions satisfied, and (d) refinancings
and refundings of such Indebtedness in compliance with Section 7.02(e).

 

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7.08. Change in Nature of Business

In the case of each of the Loan Parties, engage in any line of business
substantially different from the Business conducted by the Loan Parties and
their Subsidiaries on the date hereof or any business substantially related or
incidental thereto.

7.09. Transactions with Affiliates. Enter into, renew, extend or be a party to
any transaction of any kind with any Affiliate of any Loan Party, whether or not
in the ordinary course of business, other than on fair and reasonable terms
substantially as favorable to the Loan Parties or such Subsidiary as would be
obtainable by the Loan Parties or such Subsidiary at the time in a comparable
arm’s length transaction with a Person other than an Affiliate, provided that
the foregoing restriction shall not apply to a transaction between or among the
Loan Parties.

7.10. Burdensome Agreements. Enter into or permit to exist any Contractual
Obligation (other than this Agreement or any other Loan Document) that
(a) limits the ability (i) of any Subsidiary to make Restricted Payments or
other distributions to any Loan Party or to otherwise transfer property to or
invest in a Loan Party, (ii) of any Subsidiary to Guarantee the Obligations,
(iii) of any Subsidiary to make or repay loans to a Loan Party, or (iv) of the
Loan Parties or any Subsidiary to create, incur, assume or suffer to exist Liens
on property of such Person in favor of the Administrative Agent; provided,
however, that this clause (iv) shall not prohibit any negative pledge incurred
or provided in favor of any holder of Indebtedness permitted under clauses
(c) or (j) of the definition of Permitted Indebtedness solely to the extent any
such negative pledge relates to the property financed by or the subject of such
Indebtedness; or (b) requires the grant of a Lien to secure an obligation of
such Person if a Lien is granted to secure another obligation of such Person.

7.11. Use of Proceeds. Use the proceeds of any Credit Extension, whether
directly or indirectly, and whether immediately, incidentally or ultimately,
(a) to purchase or carry margin stock (within the meaning of Regulation U of the
FRB) or to extend credit to others for the purpose of purchasing or carrying
margin stock or to refund Indebtedness originally incurred for such purpose; or
(b) for purposes other than those permitted under this Agreement.

7.12. Amendment of Material Documents. Amend, modify or waive any of a Loan
Party’s rights under (a) its Organization Documents in a manner materially
adverse to the Credit Parties, or (b) any Material Contract or Material
Indebtedness (other than on account of any refinancing thereof otherwise
permitted hereunder), in each case to the extent that such amendment,
modification or waiver would result in a Default or Event of Default under any
of the Loan Documents, would be materially adverse to the Credit Parties or
otherwise would be reasonably likely to have a Material Adverse Effect.

7.13. Fiscal Year. Change the Fiscal Year of any Loan Party, or the accounting
policies or reporting practices of the Loan Parties, except as required by GAAP.

7.14. Deposit Accounts; Credit Card Processors. Open new DDAs or Blocked
Accounts unless the Loan Parties shall have delivered to the Administrative
Agent appropriate DDA Notifications or Blocked Account Agreements consistent
with the provisions of Section 6.13 and otherwise satisfactory to the
Administrative Agent. No Loan Party shall maintain any bank accounts or enter
into any agreements with Credit Card Processors other than the ones expressly
contemplated herein or in Section 6.13 hereof.

7.15. Financial Covenants. Consolidated Fixed Charge Coverage Ratio. Following
the occurrence and during the continuance of a Covenant Compliance Event, permit
the Consolidated Fixed Charge Coverage Ratio, calculated as of the last day of
each month for the Measurement Period then ended, to be less than 1.0:1.0.

 

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ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES

8.01. Events of Default. Any of the following shall constitute an Event of
Default:

(a) Non-Payment. The Borrowers or any other Loan Party fails to pay within one
(1) Business Day after when and as required to be paid herein, (i) any amount of
principal of any Loan or any LC Obligation, or deposit any funds as Cash
Collateral in respect of LC Obligations, or (ii) any interest on any Loan or on
any LC Obligation, or any fee due hereunder, or (iii) any other amount payable
hereunder or under any other Loan Document; or

(b) Specific Covenants. (i) Any Loan Party fails to perform or observe any term,
covenant or agreement contained in any of Section 6.01 or Section 6.02 (other
than Section 6.02(c)) and such failure continues for three (3) Business Days
after the Lead Borrower receives either written or oral notice thereof from the
Administrative Agent; or (ii) any Loan Party fails to perform or observe any
term, covenant or agreement contained in any of Section 6.02(c), 6.03, 6.05,
6.07, 6.10, 6.11, 6.12, 6.13 or 6.14 or Article VII (other than Section 7.08,
7.10 or 7.13); or (iii) any Guarantor fails to perform or observe any term,
covenant or agreement contained in the Facility Guaranty; or (iv) any of the
Loan Parties fails to perform or observe any term, covenant or agreement
contained in any of the Security Documents to which it is a party, and in the
case of clauses (ii) and (iii) in this Section 8.01(b), such failure continues
beyond any applicable grace or cure period; or

(c) Other Defaults. Any Loan Party fails to perform or observe any other
covenant or agreement (not specified in subsection (a) or (b) above) contained
in any Loan Document on its part to be performed or observed and such failure
continues for fifteen (15) days after the earlier of (i) receipt by such Loan
Party of written notice from the Administrative Agent of such failure and
(ii) the time at which such Loan Party or any Responsible Officer thereof knew
or became aware of, or should reasonably have known or been aware of, such
failure; or

(d) Representations and Warranties. Any representation, warranty, certification
or statement of fact made or deemed made by or on behalf of any Borrower or any
other Loan Party herein, in any other Loan Document, or in any document
delivered in connection herewith or therewith (including, without limitation,
any Borrowing Base Certificate) shall be incorrect or misleading in any material
respect when made or deemed made; or

(e) Cross-Default. (i) Any Loan Party or any Subsidiary thereof (A) fails to
make any payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Material Indebtedness
(including undrawn committed or available amounts and including amounts owing to
all creditors under any combined or syndicated credit arrangement), or (B) fails
to observe or perform any other agreement or condition relating to any such
Material Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event occurs, the effect of which
default or other event is to cause, or to permit the holder or holders of such
Material Indebtedness or the beneficiary or beneficiaries of any Guarantee
thereof (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if required,
such Indebtedness to be demanded or to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or an offer to repurchase,
prepay, defease or redeem such Indebtedness to be made, prior to its stated
maturity, or such Guarantee to become payable or cash collateral in respect
thereof to be demanded; or (ii) there occurs under any Swap Contract an Early

 

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Termination Date (as defined in such Swap Contract) resulting from (A) any event
of default under such Swap Contract as to which a Loan Party or any Subsidiary
thereof is the Defaulting Party (as defined in such Swap Contract) or (B) any
Termination Event (as so defined) under such Swap Contract as to which a Loan
Party or any Subsidiary thereof is an Affected Party (as so defined) and, in
either event, the Swap Termination Value owed by the Loan Party or such
Subsidiary as a result thereof is greater than $2,500,000; or

(f) Insolvency Proceedings, Etc. Any Loan Party or any of its Subsidiaries
institutes or consents to the institution of any proceeding under any Debtor
Relief Law, or makes an assignment for the benefit of creditors; or applies for
or consents to the appointment of any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer for it or for all or any material
part of its property; or a proceeding shall be commenced or a petition filed,
without the application or consent of such Person, seeking or requesting the
appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer is appointed and the appointment continues
undischarged, undismissed or unstayed for thirty (30) calendar days or an order
or decree approving or ordering any of the foregoing shall be entered; or any
proceeding under any Debtor Relief Law relating to any such Person or to all or
any material part of its property is instituted without the consent of such
Person and continues undismissed or unstayed for thirty (30) calendar days, or
an order for relief is entered in any such proceeding; or

(g) Inability to Pay Debts; Attachment. (i) Any Loan Party or any Subsidiary
thereof becomes unable or admits in writing its inability or fails generally to
pay its debts as they become due in the ordinary course of business, or (ii) any
writ or warrant of attachment or execution or similar process is issued or
levied against all or any material part of the property of any such Person and
is not released, vacated or fully bonded within ten (10) days after its issuance
or levy; or

(h) Judgments. There is entered against any Loan Party or any Subsidiary thereof
(i) one or more judgments or orders for the payment of money in an aggregate
amount (as to all such judgments and orders outstanding at any time) exceeding
$5,000,000 (to the extent not covered by independent third-party insurance as to
which the insurer is rated at least “A” by A.M. Best Company, has been notified
of the potential claim and does not dispute coverage), or (ii) any one or more
non-monetary judgments that have, or could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect and, in the case of
either clause (i) or (ii) of this provision, (A) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (B) there is a period
of thirty (30) consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, is not in effect;
or

(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of any Loan Party under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $1,000,000 or
which would reasonably likely result in a Material Adverse Effect, or (ii) a
Loan Party or any ERISA Affiliate fails to pay when due, after the expiration of
any applicable grace period, any installment payment with respect to its
withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in
an aggregate amount in excess of $1,000,000 or which would reasonably likely
result in a Material Adverse Effect; or

(j) Invalidity of Loan Documents. (i) Any provision of any Loan Document, at any
time after its execution and delivery and for any reason other than as expressly
permitted hereunder or thereunder or satisfaction in full of all the
Obligations, ceases to be in full force and effect; or any Loan Party or any
other Person contests in any manner the validity or enforceability of any
provision of any Loan Document; or any Loan Party denies that it has any or
further liability or obligation under any

 

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provision of any Loan Document, or purports to revoke, terminate or rescind any
provision of any Loan Document or seeks to avoid, limit or otherwise adversely
affect any Lien purported to be created under any Security Document; or (ii) any
Lien purported to be created under any Security Document shall cease to be, or
shall be asserted by any Loan Party or any other Person not to be, a valid and
perfected Lien on any Collateral, with the priority required by the applicable
Security Document; or

(k) Change of Control. There occurs any Change of Control; or

(l) Cessation of Business. Except as otherwise expressly permitted hereunder,
any Loan Party shall take any action to suspend the operation of its business in
the ordinary course, liquidate all or a material portion of its assets or Store
locations, or employ an agent or other third party to conduct a program of
closings, liquidations or “going-out-of-business” sales of any material portion
of its business; or

(m) Loss of Collateral. There occurs any uninsured loss to any portion of the
Collateral having a value in excess of $1,000,000; or

(n) Breach of Contractual Obligation. Any Loan Party or any Subsidiary thereof
fails to make any payment when due (whether by scheduled maturity, required
prepayment, acceleration, demand, or otherwise) in respect of any Material
Contract or fails to observe or perform any other agreement or condition
relating to any such Material Contract or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event occurs,
the effect of which default or other event is to cause, or to permit the
counterparty to such Material Contract to terminate such Material Contract; or

(o) Indictment. The indictment or institution of any legal process or proceeding
against, any Loan Party or any Subsidiary thereof, under any federal, state,
municipal, and other criminal statute, rule, regulation, order, or other
requirement having the force of law for a felony; or

(p) Guaranty. The termination or attempted termination of any Facility Guaranty
except as expressly permitted hereunder or under any other Loan Document; or

(q) Credit Card Agreements. (i) any Credit Card Issuer or Credit Card Processor
shall send notice to any Borrower that it is ceasing to make or suspending all,
or substantially all, payments to such Borrower of amounts due or to become due
to such Borrower or shall cease or suspend all, or substantially all, such
payments, or shall send notice to such Borrower that it is terminating its
arrangements with Borrower (except upon the normal expiration of such
arrangements) or such arrangements shall terminate as a result of any event of
default under such arrangements by a Loan Party, which continues for more than
the applicable cure period, if any, with respect thereto, unless such Borrower
shall have entered into arrangements with another Credit Card Issuer or Credit
Card Processor, as the case may be, prior to the effective date of such
termination or (ii) any Credit Card Issuer or Credit Card Processor withholds
payment of amounts otherwise payable to a Borrower to fund a reserve account or
otherwise hold as collateral, or shall require a Borrower to pay funds into a
reserve account or for such Credit Card Issuer or Credit Card Processor to
otherwise hold as collateral, or any Borrower shall provide a letter of credit,
guarantee, indemnity or similar instrument to or in favor of such Credit Card
Issuer or Credit Card Processors such that in the aggregate all of such funds in
the reserve account, other than amounts held as collateral and the amount of
such letters of credit, guarantees, indemnities or similar instruments shall
exceed an amount equal to ten percent (10%) of the Credit Card Receivables
processed by such Credit Card Issuer or Credit Card Processor in the immediately
preceding Fiscal Year; or

 

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(r) Subordination. (i) The subordination provisions of the documents evidencing
or governing any Subordinated Indebtedness (the “Subordination Provisions”)
shall, in whole or in part, terminate, cease to be effective or cease to be
legally valid, binding and enforceable against any holder of the applicable
Subordinated Indebtedness; or (ii) any Borrower or any other Loan Party shall,
directly or indirectly, disavow or contest in any manner (A) the effectiveness,
validity or enforceability of any of the Subordination Provisions, (B) that the
Subordination Provisions exist for the benefit of the Credit Parties, or
(C) that all payments of principal of or premium and interest on the applicable
Subordinated Indebtedness, or realized from the liquidation of any property of
any Loan Party, shall be subject to any of the Subordination Provisions.

8.02. Remedies Upon Event of Default. If any Event of Default occurs and is
continuing, the Administrative Agent may, or, at the request of the Required
Lenders shall, take any or all of the following actions:

(a) declare the Commitments of each Lender to make Loans and any obligation of
the LC Issuer to make LC Credit Extensions to be terminated, whereupon such
Commitments and obligation shall be terminated;

(b) declare the unpaid principal amount of all outstanding Loans, all interest
accrued and unpaid thereon, and all other amounts owing or payable hereunder or
under any other Loan Document to be immediately due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Loan Parties;

(c) require that the Loan Parties Cash Collateralize the LC Obligations; and

(d) whether or not the maturity of the Obligations shall have been accelerated
pursuant hereto, proceed to protect, enforce and exercise all rights and
remedies of the Credit Parties under this Agreement, any of the other Loan
Documents or applicable Law, including, but not limited to, by suit in equity,
action at law or other appropriate proceeding, whether for the specific
performance of any covenant or agreement contained in this Agreement and the
other Loan Documents or any instrument pursuant to which the Obligations are
evidenced, and, if such amount shall have become due, by declaration or
otherwise, proceed to enforce the payment thereof or any other legal or
equitable right of the Credit Parties;

provided, that, upon the entry of an order for relief (or similar order) with
respect to any Loan Party or any Subsidiary thereof under any Debtor Relief
Laws, the obligation of each Lender to make Loans and any obligation of the LC
Issuer to make LC Credit Extensions shall automatically terminate, the unpaid
principal amount of all outstanding Loans and all interest and other amounts as
aforesaid shall automatically become due and payable, and the obligation of the
Loan Parties to Cash Collateralize the LC Obligations as aforesaid shall
automatically become effective, in each case without further act of the
Administrative Agent or any Lender.

No remedy herein is intended to be exclusive of any other remedy and each and
every remedy shall be cumulative and shall be in addition to every other remedy
given hereunder or now or hereafter existing at law or in equity or by statute
or any other provision of Law.

8.03. Application of Funds. After the exercise of remedies provided for in
Section 8.02 (or after the Loans have automatically become immediately due and
payable and the LC Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), any amounts
received on account of the Obligations shall be applied by the Administrative
Agent in the following order:

first, to payment of that portion of the Obligations (excluding the Bank Product
Obligations) constituting fees, indemnities, Credit Party Expenses and other
amounts (including fees, charges and disbursements of counsel to the
Administrative Agent and amounts payable under Article III) payable to the
Administrative Agent, in its capacity as such;

 

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second, to payment of that portion of the Obligations (excluding the Bank
Product Obligations) constituting indemnities, Credit Party Expenses, and other
amounts (other than principal, interest and fees) payable to the Lenders and the
LC Issuer (including fees, charges and disbursements of counsel to the
respective Lenders and the LC Issuer and amounts payable under Article III),
ratably among them in proportion to the amounts described in this clause second
payable to them;

third, to the extent not previously reimbursed by the Lenders, to payment to the
Administrative Agent of that portion of the Obligations constituting principal
and accrued and unpaid interest on any Permitted Overadvances;

fourth, to the extent that Swing Line Loans have not been refinanced by a
Committed Loan, payment to the Swing Line Lender of that portion of the
Obligations constituting accrued and unpaid interest on the Swing Line Loans;

fifth, to payment of that portion of the Obligations constituting accrued and
unpaid interest on the Committed Loans and other Obligations, and fees
(including Letter of Credit Fees), ratably among the Lenders and the LC Issuer
in proportion to the respective amounts described in this clause fifth payable
to them;

sixth, to the extent that Swing Line Loans have not been refinanced by a
Committed Loan, to payment to the Swing Line Lender of that portion of the
Obligations constituting unpaid principal of the Swing Line Loans;

seventh, to payment of that portion of the Obligations constituting unpaid
principal of the Committed Loans, ratably among the Lenders and the LC Issuer in
proportion to the respective amounts described in this clause seventh held by
them;

eighth, to the Administrative Agent for the account of the LC Issuer, to Cash
Collateralize that portion of LC Obligations comprised of the aggregate undrawn
amount of Letters of Credit;

ninth, to payment of all other Obligations (including, without limitation, the
cash collateralization of Obligations (other than contingent indemnification
obligations for which no claim has been asserted) that may thereafter arise
under Section 10.04, as provided in Section 10.11(c), but excluding any Bank
Product Obligations), ratably among the Credit Parties in proportion to the
respective amounts described in this clause ninth held by them;

tenth, to payment of that portion of the Obligations arising from Cash
Management Services to the extent secured under the Security Documents, ratably
among the Credit Parties in proportion to the respective amounts described in
this clause tenth held by them;

eleventh, to payment of all other Obligations arising from Bank Products and
Factored Receivables to the extent secured under the Security Documents, ratably
among the Credit Parties in proportion to the respective amounts described in
this clause eleventh held by them; and

last, the balance, if any, after all of the Obligations have been indefeasibly
paid in full, to the Loan Parties or as otherwise required by Law.

 

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Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Seventh above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.

ARTICLE IX

ADMINISTRATIVE AGENT

9.01. Appointment and Authority.

(a) Each of the Lenders and the LC Issuer hereby irrevocably appoints Wells
Fargo to act on its behalf as the Administrative Agent hereunder and under the
other Loan Documents and authorizes the Administrative Agent to take such
actions on its behalf and to exercise such powers as are delegated to the
Administrative Agent by the terms hereof or thereof, together with such actions
and powers as are reasonably incidental thereto. The provisions of this Article
are solely for the benefit of the Administrative Agent, the Lenders and the LC
Issuer, and no Loan Party or any Subsidiary thereof shall have rights as a third
party beneficiary of any of such provisions.

(b) Each of the Lenders (in its capacities as a Lender) and the LC Issuer hereby
irrevocably appoints Wells Fargo as the Administrative Agent and authorizes the
Administrative Agent to act as the agent of such Lender for purposes of
acquiring, holding and enforcing any and all Liens on Collateral granted by any
of the Loan Parties to secure any of the Obligations, together with such powers
and discretion as are reasonably incidental thereto. In this connection, the
Administrative Agent, as “collateral agent” and any co-agents, sub-agents and
attorneys-in-fact appointed by the Administrative Agent pursuant to Section 9.05
for purposes of holding or enforcing any Lien on the Collateral (or any portion
thereof) granted under the Security Documents, or for exercising any rights and
remedies thereunder at the direction of the Administrative Agent), shall be
entitled to the benefits of all provisions of this Article IX and Article X
(including Section 10.04(c)), as though such co-agents, sub-agents and
attorneys-in-fact were the “collateral agent” under the Loan Documents, as if
set forth in full herein with respect thereto.

(c) Each Lender authorizes and directs the Administrative Agent to enter into
this Agreement and the other Loan Documents. Each Lender agrees that any action
taken by the Administrative Agent or Required Lenders in accordance with the
terms of this Agreement or the other Loan Documents and the exercise by the
Administrative Agent or Required Lenders of their respective powers set forth
herein or therein, together with such other powers that are reasonably
incidental thereto, shall be binding upon all of the Lenders.

9.02. Rights as a Lender. The Person serving as the Administrative Agent
hereunder shall have the same rights and powers in their capacity as a Lender as
any other Lender and may exercise the same as though they were not the
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative Agent hereunder in its individual capacity. Such
Person and its Affiliates may accept deposits from, lend money to, act as the
financial advisor or in any other advisory capacity for and generally engage in
any kind of business with the Loan Parties or any Subsidiary or other Affiliate
thereof as if such Person were not the Administrative Agent hereunder and
without any duty to account therefor to the Lenders.

 

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9.03. Exculpatory Provisions. The Administrative Agent shall not have any duties
or obligations except those expressly set forth herein and in the other Loan
Documents. Without limiting the generality of the foregoing, the Administrative
Agent:

(a) shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing;

(b) shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that the Administrative Agent
is required to exercise as directed in writing by the Required Lenders (or such
other number or percentage of the Lenders as shall be expressly provided for
herein or in the other Loan Documents), provided that no Agent shall be required
to take any action that, in its respective opinion or the opinion of its
counsel, may expose such Agent to liability or that is contrary to any Loan
Document or applicable law; and

(c) shall not, except as expressly set forth herein and in the other Loan
Documents, have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to the Loan Parties or any of their
Affiliates that is communicated to or obtained by the Person serving as the
Administrative Agent or any of its Affiliates in any capacity.

The Administrative Agent shall not be liable for any action taken or not taken
by it (i) with the Consent or at the request of the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary, or as the
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in and Sections 8.02 and 10.01) or (ii) in the absence
of its own gross negligence or willful misconduct as determined by a final and
non-appealable judgment of a court of competent jurisdiction.

The Administrative Agent shall not be deemed to have knowledge of any Default
unless and until notice describing such Default is given to the Administrative
Agent by the Loan Parties, a Lender or the LC Issuer. Upon the occurrence of an
Event of Default, the Administrative Agent shall take such action with respect
to such Default or Event of Default as shall be reasonably directed by the
Applicable Lenders. Unless and until the Administrative Agent shall have
received such direction, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to any such Default or Event of Default as it shall deem advisable in the best
interest of the Credit Parties. In no event shall the Administrative Agent be
required to comply with any such directions to the extent that the
Administrative Agent believes that its compliance with such directions would be
unlawful.

The Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in
or in connection with this Agreement or any other Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or therein or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan
Document or any other agreement, instrument or document or the creation,
perfection or priority of any Lien purported to be created by the Security
Documents, (v) the value or the sufficiency of any Collateral, or (vi) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.

9.04. Reliance by the Administrative Agent. The Administrative Agent shall be
entitled to rely upon, and shall not incur any liability for relying upon, any
notice, request, certificate, consent, statement, instrument, document or other
writing (including, but not limited to, any electronic message,

 

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Internet or intranet website posting or other distribution) reasonably believed
by it to be genuine and to have been signed, sent or otherwise authenticated by
the proper Person. The Administrative Agent also may rely upon any statement
made to it orally or by telephone and reasonably believed by it to have been
made by the proper Person, and shall not incur any liability for relying
thereon. In determining compliance with any condition hereunder to the making of
a Loan, or the issuance of a Letter of Credit, that by its terms must be
fulfilled to the satisfaction of a Lender or the LC Issuer, the Administrative
Agent may presume that such condition is satisfactory to such Lender or the LC
Issuer unless the Administrative Agent shall have received written notice to the
contrary from such Lender or the LC Issuer prior to the making of such Loan or
the issuance of such Letter of Credit. The Administrative Agent may consult with
legal counsel (who may be counsel for any Loan Party), independent accountants
and other experts selected by it, and shall not be liable for any action taken
or not taken by it in accordance with the advice of any such counsel,
accountants or experts.

9.05. Delegation of Duties. The Administrative Agent may perform any and all of
its duties and exercise its rights and powers hereunder or under any other Loan
Document by or through any one or more sub agents appointed by the
Administrative Agent. The Administrative Agent and any such sub agent may
perform any and all of its duties and exercise its rights and powers by or
through their respective Related Parties. The exculpatory provisions of this
Article shall apply to any such sub agent and to the Related Parties of the
Administrative Agent and any such sub agent, and shall apply to their respective
activities in connection with the syndication of the credit facilities provided
for herein as well as activities as the Administrative Agent.

9.06. Resignation of the Administrative Agent. The Administrative Agent may at
any time give written notice of its resignation to the Lenders and the Lead
Borrower. Upon receipt of any such notice of resignation, the Required Lenders
shall have the right, in consultation with the Lead Borrower (so long as no
Default or Event of Default shall have then occurred and be continuing), to
appoint a successor, which shall be a bank with an office in the United States,
or an Affiliate of any such bank with an office in the United States. If no such
successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within thirty (30) days after the retiring
Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may, on behalf of the Lenders and the LC Issuer, appoint a
successor to the Administrative Agent meeting the qualifications set forth
above; provided that, if the Administrative Agent shall notify the Lead Borrower
and the Lenders that no qualifying Person has accepted such appointment, then
such resignation shall nonetheless become effective in accordance with such
notice and (1) the retiring Administrative Agent shall be discharged from its
duties and obligations hereunder and under the other Loan Documents (except that
in the case of any Collateral held by the Administrative Agent on behalf of the
Lenders or the LC Issuer under any of the Loan Documents, the retiring
Administrative Agent shall continue to hold such collateral security until such
time as a successor Administrative Agent is appointed) and (2) all payments,
communications and determinations provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender and the LC
Issuer directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this Section. Upon the acceptance
of a successor’s appointment as the Administrative Agent hereunder, such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring (or retired) Administrative Agent, and the
retiring Administrative Agent shall be discharged from all of its duties and
obligations hereunder or under the other Loan Documents (if not already
discharged therefrom as provided above in this Section). The fees payable by the
Borrowers to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Lead Borrower and such
successor. After the retiring Administrative Agent’s resignation hereunder and
under the other Loan Documents, the provisions of this Article and Section 10.04
shall continue in effect for the benefit of such retiring Administrative Agent,
its sub agents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while the retiring Administrative
Agent was acting as Administrative Agent hereunder.

 

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Any resignation by Wells Fargo as the Administrative Agent pursuant to this
Section shall also constitute its resignation as Swing Line Lender and the
resignation of Wells Fargo as LC Issuer. Upon the acceptance of a successor’s
appointment as the Administrative Agent hereunder, (a) such successor shall
succeed to and become vested with all of the rights, powers, privileges and
duties of the retiring LC Issuer and the Swing Line Lender, (b) the retiring LC
Issuer and the Swing Line Lender shall be discharged from all of their
respective duties and obligations hereunder or under the other Loan Documents,
and (c) the successor LC Issuer shall issue letters of credit in substitution
for the Letters of Credit, if any, outstanding at the time of such succession or
make other arrangements satisfactory to the retiring LC Issuer to effectively
assume the obligations of the retiring LC Issuer with respect to such Letters of
Credit.

9.07. Non-Reliance on Administrative Agent and Other Lenders. Each Lender and
the LC Issuer acknowledges that it has, independently and without reliance upon
the Administrative Agent or any other Lender or any of their Related Parties and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Lender and
the LC Issuer also acknowledges that it will, independently and without reliance
upon the Administrative Agent or any other Lender or any of their Related
Parties and based on such documents and information as it shall from time to
time deem appropriate, continue to make its own decisions in taking or not
taking action under or based upon this Agreement, any other Loan Document or any
related agreement or any document furnished hereunder or thereunder. Except as
provided in Section 9.12, the Administrative Agent shall not have any duty or
responsibility to provide any Credit Party with any other credit or other
information concerning the affairs, financial condition or business of any Loan
Party that may come into the possession of the Administrative Agent.

9.08. No Other Duties, Etc. Anything herein to the contrary notwithstanding,
neither the Bookrunner nor Arranger listed on the cover page hereof shall have
any powers, duties or responsibilities under this Agreement or any of the other
Loan Documents, except in its capacity, as applicable, as the Administrative
Agent, a Lender or the LC Issuer hereunder.

9.09. Administrative Agent May File Proofs of Claim. In case of the pendency of
any proceeding under any Debtor Relief Law or any other judicial proceeding
relative to any Loan Party, the Administrative Agent (irrespective of whether
the principal of any Loan or LC Obligation shall then be due and payable as
herein expressed or by declaration or otherwise and irrespective of whether the
Administrative Agent shall have made any demand on the Loan Parties) shall be
entitled and empowered, by intervention in such proceeding or otherwise

(a) to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Loans, LC Obligations and all other
Obligations that are owing and unpaid and to file such other documents as may be
necessary or advisable in order to have the claims of the Lenders, the LC
Issuer, the Administrative Agent and the other Credit Parties (including any
claim for the reasonable compensation, expenses, disbursements and advances of
the Lenders, the LC Issuer, the Administrative Agent, such Credit Parties and
their respective agents and counsel and all other amounts due the Lenders, the
LC Issuer the Administrative Agent and such Credit Parties under Sections
2.03(i), 2.03(j) and 2.03(k) as applicable, 2.09 and 10.04) allowed in such
judicial proceeding; and

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

 

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and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender and the LC Issuer to make such payments to the Administrative Agent
and, if the Administrative Agent shall consent to the making of such payments
directly to the Lenders and the LC Issuer, to pay to the Administrative Agent
any amount due for the reasonable compensation, expenses, disbursements and
advances of the Administrative Agent and its agents and counsel, and any other
amounts due the Administrative Agent under Sections 2.09 and 10.04.

Nothing contained herein shall be deemed to authorize the Administrative Agent
to authorize or consent to or accept or adopt on behalf of any Lender or the LC
Issuer any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or the LC Issuer or to
authorize the Administrative Agent to vote in respect of the claim of any Lender
or the LC Issuer in any such proceeding.

9.10. Collateral and Guaranty Matters. The Credit Parties irrevocably authorize
the Administrative Agent, at its option and in its discretion,

(a) to release any Lien on any property granted to or held by the Administrative
Agent under any Loan Document (i) upon termination of the Aggregate Commitments
and payment in full of all Obligations (other than contingent indemnification
obligations for which no claim has been asserted) and the expiration or
termination of all Letters of Credit, (ii) that is sold or to be sold as part of
or in connection with any sale permitted hereunder or under any other Loan
Document, or (iii) if approved, authorized or ratified in writing by the
Applicable Lenders in accordance with Section 10.01;

(b) to subordinate any Lien on any property granted to or held by the
Administrative Agent under any Loan Document to the holder of any Lien on such
property that is permitted by clause (h) of the definition of Permitted
Encumbrances; and

(c) to release any Guarantor from its obligations under the Facility Guaranty if
such Person ceases to be a Subsidiary as a result of a transaction permitted
hereunder.

Upon request by the Administrative Agent at any time, the Applicable Lenders
will confirm in writing the Administrative Agent’s authority to release or
subordinate its interest in particular types or items of property, or to release
any Guarantor from its obligations under the Facility Guaranty pursuant to this
Section 9.10. In each case as specified in this Section 9.10, the Administrative
Agent will, at the Loan Parties’ expense, execute and deliver to the applicable
Loan Party such documents as such Loan Party may reasonably request to evidence
the release of such item of Collateral from the assignment and security interest
granted under the Security Documents or to subordinate its interest in such
item, or to release such Guarantor from its obligations under the Facility
Guaranty, in each case in accordance with the terms of the Loan Documents and
this Section 9.10.

9.11. Notice of Transfer. The Administrative Agent may deem and treat a Lender
party to this Agreement as the owner of such Lender’s portion of the Obligations
for all purposes, unless and until, and except to the extent, an Assignment and
Assumption shall have become effective as set forth in Section 10.06.

9.12. Reports and Financial Statements. By signing this Agreement, each Lender:

(a) agrees to furnish the Administrative Agent, at such frequency as the
Administrative Agent may reasonably request, with a summary of all Bank Product
Obligations due or to become due to such Lender. In connection with any
distributions to be made hereunder, the Administrative Agent shall be entitled
to assume that no amounts are due to any Lender on account of Bank Product
Obligations unless the Administrative Agent has received written notice thereof
from such Lender;

 

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(b) is deemed to have requested that the Administrative Agent furnish such
Lender, promptly after they become available, copies of all financial statements
required to be delivered by the Lead Borrower hereunder and all field
examinations and appraisals of the Collateral received by the Administrative
Agent (collectively, the “Reports”);

(c) expressly agrees and acknowledges that the Administrative Agent makes no
representation or warranty as to the accuracy of the Reports, and shall not be
liable for any information contained in any Report;

(d) expressly agrees and acknowledges that the Reports are not comprehensive
audits or examinations, that the Administrative Agent or any other party
performing any audit or examination will inspect only specific information
regarding the Loan Parties and will rely significantly upon the Loan Parties’
books and records, as well as on representations of the Loan Parties’ personnel;

(e) agrees to keep all Reports confidential in accordance with the provisions of
Section 10.07 hereof; and

(f) without limiting the generality of any other indemnification provision
contained in this Agreement, agrees: (i) to hold the Administrative Agent and
any such other Lender preparing a Report harmless from any action the
indemnifying Lender may take or conclusion the indemnifying Lender may reach or
draw from any Report in connection with any Credit Extensions that the
indemnifying Lender has made or may make to the Borrowers, or the indemnifying
Lender’s participation in, or the indemnifying Lender’s purchase of, a Loan or
Loans; and (ii) to pay and protect, and indemnify, defend, and hold the
Administrative Agent and any such other Lender preparing a Report harmless from
and against, the claims, actions, proceedings, damages, costs, expenses, and
other amounts (including attorney costs) incurred by the Administrative Agent
and any such other Lender preparing a Report as the direct or indirect result of
any third parties who might obtain all or part of any Report through the
indemnifying Lender.

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

9.14. Indemnification of Administrative Agent. The Lenders hereby agree to
indemnify the Administrative Agent, the LC Issuer and any Related Party, as the
case may be (to the extent not reimbursed by the Loan Parties and without
limiting the obligations of Loan Parties hereunder), ratably according to their
Applicable Percentages, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever that may be imposed on, incurred
by, or asserted against any of the Administrative Agent, the LC Issuer or any
Related Party in any way relating to or arising out of this Agreement or any
other Loan Document or any action taken or omitted to be taken by any of the
Administrative Agent, the LC Issuer or any Related Party in connection
therewith; provided, that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the gross negligence or willful
misconduct of the Administrative Agent, the LC Issuer or any Related Party as
determined by a final and non-appealable judgment of a court of competent
jurisdiction.

 

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9.15. Relation among Lenders. The Lenders are not partners or co-venturers, and
no Lender shall be liable for the acts or omissions of, or (except as otherwise
set forth herein in case of the Administrative Agent) authorized to act for, any
other Lender.

9.16. Defaulting or Deteriorating Lender.

(a) If for any reason any Lender shall become a Deteriorating Lender or shall
fail or refuse to abide by its obligations under this Agreement, including
without limitation its obligation to make available to the Administrative Agent
its Applicable Percentage of any Loans, expenses or setoff or purchase its
Applicable Percentage of a participation interest in the Swing Line Loans or
Letters of Credit and such failure is not cured within one (1) Business Day
after receipt from the Administrative Agent of written notice thereof, then, in
addition to the rights and remedies that may be available to the other Credit
Parties, the Loan Parties or any other party at law or in equity, and not at
limitation thereof, (i) such Deteriorating Lender’s or Defaulting Lender’s right
to participate in the administration of, or decision-making rights related to,
the Obligations, this Agreement or the other Loan Documents shall be suspended
during the pendency of such failure or refusal, and (ii) a Deteriorating Lender
or Defaulting Lender shall be deemed to have assigned any and all payments due
to it from the Loan Parties, whether on account of outstanding Loans, interest,
fees or otherwise, to the remaining non-Defaulting Lenders for application to,
and reduction of, their proportionate shares of all outstanding Obligations
until, as a result of application of such assigned payments the Lenders’
respective Applicable Percentages of all outstanding Obligations shall have
returned to those in effect immediately prior to such delinquency and without
giving effect to the nonpayment causing such delinquency, and (iii) at the
option of the Administrative Agent, any amount payable to such Deteriorating
Lender or Defaulting Lender hereunder (whether on account of principal,
interest, fees or otherwise) shall, in lieu of being distributed to such
Deteriorating Lender or Defaulting Lender, be retained by the Administrative
Agent as cash collateral for future funding obligations of the Deteriorating
Lender or Defaulting Lender in respect of any Loan or existing or future
participating interest in any Swing Line Loan or Letter of Credit. The
Defaulting Lender’s decision-making and participation rights and rights to
payments as set forth in clauses (i) and (ii) hereinabove shall be restored only
upon the payment by the Defaulting Lender of its Applicable Percentage of any
Obligations, any participation obligation, or expenses as to which it is
delinquent, together with interest thereon at the rate set forth in
Section 2.14(b) hereof from the date when originally due until the date upon
which any such amounts are actually paid.

(b) The non-Defaulting Lenders shall also have the right, but not the
obligation, in their respective, sole and absolute discretion, to cause the
termination and assignment, without any further action by the Deteriorating
Lender or Defaulting Lender for no cash consideration (pro rata, based on the
respective Commitments of those Lenders electing to exercise such right), of the
Deteriorating Lender’s or Defaulting Lender’s Commitment to fund future Loans.
Upon any such purchase of the Applicable Percentage of any Deteriorating Lender
or Defaulting Lender, the Deteriorating Lender’s or Defaulting Lender’s share in
future Credit Extensions and its rights under the Loan Documents with respect
thereto shall terminate on the date of purchase, and the Deteriorating Lender or
Defaulting Lender shall promptly execute all documents reasonably requested to
surrender and transfer such interest, including, if so requested, an Assignment
and Assumption.

(c) Each Deteriorating Lender and Defaulting Lender shall indemnify the
Administrative Agent and each non-Defaulting Lender from and against any and all
loss, damage or expenses, including but not limited to reasonable attorneys’
fees and funds advanced by the Administrative Agent or by any non-Defaulting
Lender, on account of a Deteriorating Lender’s or Defaulting Lender’s failure to
timely fund its Applicable Percentage of a Loan or to otherwise perform its
obligations under the Loan Documents.

 

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9.17. Co-Syndication, Documentation Agent and Co-Lead Arrangers. Notwithstanding
the provisions of this Agreement or any of the other Loan Documents, no Person
who is or becomes a Co-Syndication Agent or a Documentation Agent, nor any
Arrangers, shall have any powers, rights, duties, responsibilities or
liabilities with respect to this Agreement and the other Loan Documents.

ARTICLE X

MISCELLANEOUS

10.01. Amendments, Etc. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no Consent to any departure by any
Loan Party therefrom, shall be effective unless in writing signed by the
Administrative Agent, with the Consent of the Required Lenders, and the Lead
Borrower or the applicable Loan Party, as the case may be, and acknowledged by
the Administrative Agent, and each such waiver or Consent shall be effective
only in the specific instance and for the specific purpose for which given;
provided, that, no such amendment, waiver or consent shall:

(a) extend or, increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.02) without the written Consent of
such Lender;

(b) as to any Lender, postpone any date fixed by this Agreement or any other
Loan Document for (i) any scheduled payment (including the Maturity Date) or
mandatory prepayment of principal, interest, fees or other amounts due hereunder
or under any of the other Loan Documents without the written Consent of such
Lender entitled to such payment, or (ii) any scheduled or mandatory reduction of
the Aggregate Commitments hereunder or under any other Loan Document without the
written Consent of such Lender;

(c) as to any Lender, reduce the principal of, or the rate of interest specified
herein on, any Loan, or (subject to clause (iv) of the second proviso to this
Section 10.01) any fees or other amounts payable hereunder or under any other
Loan Document, without the written Consent of each Lender entitled to such
amount; provided, however, that only the Consent of the Required Lenders shall
be necessary (i) to amend the definition of “Default Rate” or to waive any
obligation of the Borrowers to pay interest or Letter of Credit Fees at the
Default Rate or (ii) to amend any financial covenant hereunder (or any defined
term used therein) even if the effect of such amendment would be to reduce the
rate of interest on any Loan or to reduce any fee payable hereunder;

(d) as to any Lender, change Section 2.13 or Section 8.03 in a manner that would
alter the pro rata sharing of payments required thereby without the written
Consent of such Lender;

(e) change any provision of this Section or the definition of “Required
Lenders”, “Supermajority Lenders”, or any other provision hereof specifying the
number or percentage of Lenders required to amend, waive or otherwise modify any
rights hereunder or make any determination or grant any consent hereunder,
without the written Consent of each Lender;

(f) except as expressly permitted hereunder or under any other Loan Document,
release, or limit the liability of, any Loan Party without the written Consent
of each Lender;

(g) except for Permitted Dispositions, release all or substantially all of the
Collateral from the Liens of the Security Documents without the written Consent
of each Lender;

 

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(h) except as provided in Section 2.15, increase the Aggregate Commitments
without the written Consent of each Lender;

(i) change the definition of the term “Borrowing Base” or any component
definition thereof if as a result thereof the amounts available to be borrowed
by the Borrowers would be increased without the written Consent of the
Supermajority Lenders, provided that the foregoing shall not limit the
discretion of the Administrative Agent to change, establish or eliminate any
Availability Reserves;

(j) modify the definition of Permitted Overadvance so as to increase the amount
thereof or, except as provided in such definition, the time period for a
Permitted Overadvance without the written Consent of each Lender; and

(k) except as expressly permitted herein or in any other Loan Document,
subordinate the Obligations hereunder or the Liens granted hereunder or under
the other Loan Documents, to any other Indebtedness or Lien, as the case may be
without the written Consent of each Lender;

and, provided, that, (i) no amendment, waiver or Consent shall, unless in
writing and signed by the LC Issuer in addition to the Lenders required above,
affect the rights or duties of the LC Issuer under this Agreement or any Issuer
Document relating to any Letter of Credit issued or to be issued by it; (ii) no
amendment, waiver or Consent shall, unless in writing and signed by the Swing
Line Lender in addition to the Lenders required above, affect the rights or
duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver
or Consent shall, unless in writing and signed by the Administrative Agent in
addition to the Lenders required above, affect the rights or duties of the
Administrative Agent under this Agreement or any other Loan Document; (iv) the
Cash Management Letter and the Fee Letter may each be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, no Deteriorating Lender or
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.

Notwithstanding anything to the contrary in this Agreement or any other Loan
Document, no provider or holder of any Bank Products or Cash Management Services
shall have any voting or approval rights hereunder (or be deemed a Lender)
solely by virtue of its status as the provider or holder of such agreements or
products or the Obligations owing thereunder, nor shall the consent of any such
provider or holder be required (other than in their capacities as Lenders, to
the extent applicable) for any matter hereunder or under any of the other Loan
Documents, including as to any matter relating to the Collateral or the release
of Collateral or any Loan Party.

If any Lender does not Consent (a “Non-Consenting Lender”) to a proposed
amendment, waiver, consent or release with respect to any Loan Document that
requires the Consent of each Lender and that has been approved by the Required
Lenders, the Lead Borrower may replace such Non-Consenting Lender in accordance
with Section 10.13; provided that such amendment, waiver, consent or release can
be effected as a result of the assignment contemplated by such Section (together
with all other such assignments required by the Lead Borrower to be made
pursuant to this paragraph).

10.02. Notices; Effectiveness; Electronic Communications.

(a) Notices Generally. Except in the case of notices and other communications
expressly permitted to be given by telephone (and except as provided in
subsection (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopier as follows, and all
notices and other communications expressly permitted hereunder to be given by
telephone shall be made to the applicable telephone number, as follows:

(i) if to the Loan Parties, the Administrative Agent, the LC Issuer or the Swing
Line Lender, to the address, telecopier number, electronic mail address or
telephone number specified for such Person on Schedule 10.02; and

 

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(ii) if to any other Lender, to the address, telecopier number, electronic mail
address or telephone number specified in its Administrative Questionnaire.

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

(b) Electronic Communications. Notices and other communications to the Lenders
and the LC Issuer hereunder may be delivered or furnished by electronic
communication (including e mail and Internet or intranet websites) pursuant to
procedures approved by the Administrative Agent, provided that the foregoing
shall not apply to notices to any Lender or the LC Issuer pursuant to Article II
if such Lender or the LC Issuer, as applicable, has notified the Administrative
Agent that it is incapable of receiving notices under such Article by electronic
communication. The Administrative Agent or the Lead Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it, provided that
approval of such procedures may be limited to particular notices or
communications.

Unless the Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or
communication 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 communication is
available and identifying the website address therefor.

(c) The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND SUBJECT TO THIS SECTION,
EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER
MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT
OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY
ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no
event shall the Administrative Agent or any of their Related Parties
(collectively, the “Agent Parties”) have any liability to any Loan Party, any
Lender, the LC Issuer or any other Person for losses, claims, damages,
liabilities or expenses of any kind (whether in tort, contract or otherwise)
arising out of the Loan Parties’ or the Administrative Agent’s transmission of
Borrower Materials through the Internet, except to the extent that such losses,
claims, damages, liabilities or expenses are determined by a

 

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court of competent jurisdiction by a final and non-appealable judgment to have
resulted from the gross negligence or willful misconduct of such Agent Party;
provided, that, in no event shall any Agent Party have any liability to any Loan
Party, any Lender, the LC Issuer or any other Person for indirect, special,
incidental, consequential or punitive damages (as opposed to direct or actual
damages).

(d) Change of Address, Etc. Each of the Loan Parties, the Administrative Agent,
the LC Issuer and the Swing Line Lender may change its address, telecopier or
telephone number for notices and other communications hereunder by notice to the
other parties hereto. Each other Lender may change its address, telecopier or
telephone number for notices and other communications hereunder by notice to the
Lead Borrower, the Administrative Agent, the LC Issuer and the Swing Line
Lender. In addition, each Lender agrees to notify the Administrative Agent from
time to time to ensure that the Administrative Agent has on record (i) an
effective address, contact name, telephone number, telecopier number and
electronic mail address to which notices and other communications may be sent
and (ii) accurate wire instructions for such Lender.

(e) Reliance by Administrative Agent, LC Issuer and Lenders. The Administrative
Agent, the LC Issuer and the Lenders shall be entitled to rely and act upon any
notices (including telephonic Committed Loan Notices and Swing Line Loan
Notices) purportedly given by or on behalf of the Loan Parties even if (i) such
notices were not made in a manner specified herein, were incomplete or were not
preceded or followed by any other form of notice specified herein, or (ii) the
terms thereof, as understood by the recipient, varied from any confirmation
thereof. The Loan Parties shall indemnify the Administrative Agent, the LC
Issuer, each Lender and the Related Parties of each of them from all losses,
costs, expenses and liabilities resulting from the reliance by such Person on
each notice purportedly given by or on behalf of the Loan Parties. All
telephonic notices to and other telephonic communications with the
Administrative Agent may be recorded by the Administrative Agent, and each of
the parties hereto hereby consents to such recording.

10.03. No Waiver; Cumulative Remedies. No failure by any Credit Party to
exercise, and no delay by any such Person in exercising, any right, remedy,
power or privilege hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder or
under any other Loan Document preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege. The rights,
remedies, powers and privileges provided herein and in the other Loan Documents
are cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law. Without limiting the generality of the foregoing, the making of
a Loan or issuance of a Letter of Credit shall not be construed as a waiver of
any Default, regardless of whether any Credit Party may have had notice or
knowledge of such Default at the time.

10.04. Expenses; Indemnity; Damage Waiver.

(a) Costs and Expenses. The Borrowers shall pay all Credit Party Expenses.

(b) Indemnification by the Loan Parties. The Loan Parties shall indemnify the
Administrative Agent (and any sub-agent thereof), each other Credit Party, and
each Related Party of any of the foregoing Persons (each such Person being
called an “Indemnitee”) against, and hold each Indemnitee harmless (on an after
tax basis) from, any and all losses, claims, causes of action, damages,
liabilities, settlement payments, costs, and related expenses (including the
fees, charges and disbursements of any counsel for any Indemnitee), incurred by
any Indemnitee or asserted against any Indemnitee by any third party or by any
Borrower or any other Loan Party arising out of, in connection with, or as a
result of (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or
thereunder or the consummation of the transactions contemplated

 

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hereby or thereby, or, in the case of the Administrative Agent (and any
sub-agents thereof) and their Related Parties only, the administration of this
Agreement and the other Loan Documents, (ii) any Loan or Letter of Credit or the
use or proposed use of the proceeds therefrom (including any refusal by the LC
Issuer to honor a demand for payment under a Letter of Credit if the documents
presented in connection with such demand do not strictly comply with the terms
of such Letter of Credit), any bank advising or confirming a Letter of Credit or
any other nominated person with respect to a Letter of Credit seeking to be
reimbursed or indemnified or compensated, and any third party seeking to enforce
the rights of an Borrower, beneficiary, nominated person, transferee, assignee
of Letter of Credit proceeds, or holder of an instrument or document related to
any Letter of Credit), (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned or operated by any Loan Party
or any of its Subsidiaries, or any Environmental Liability related in any way to
any Loan Party or any of its Subsidiaries, (iv) any claims of, or amounts paid
by any Credit Party to, a Blocked Account Bank or other Person which has entered
into a control agreement with any Credit Party hereunder, or (v) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory, whether
brought by a third party or by any Borrower or any other Loan Party or any of
the Loan Parties’ directors, shareholders or creditors, and regardless of
whether any Indemnitee is a party thereto, in all cases, whether or not caused
by or arising, in whole or in part, out of the comparative, contributory or sole
negligence of the Indemnitee; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses (x) are determined by a court of competent
jurisdiction by final and non-appealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee or (y) result from a
claim brought by a Borrower or any other Loan Party against an Indemnitee for
breach in bad faith of such Indemnitee’s obligations hereunder or under any
other Loan Document, if the Borrowers or such Loan Party has obtained a final
and non-appealable judgment in its favor on such claim as determined by a court
of competent jurisdiction.

(c) Reimbursement by Lenders. Without limiting their obligations under
Section 9.14 hereof, to the extent that the Loan Parties for any reason fail to
indefeasibly pay any amount required under subsection (a) or (b) of this Section
to be paid by it, each Lender severally agrees to pay to the Administrative
Agent (or any such sub-agent), the LC Issuer or such Related Party, as the case
may be, such Lender’s Applicable Percentage (determined as of the time that the
applicable unreimbursed expense or indemnity payment is sought) of such unpaid
amount, provided that the unreimbursed expense or indemnified loss, claim,
damage, liability or related expense, as the case may be, was incurred by or
asserted against the Administrative Agent (or any such sub-agent) or the LC
Issuer in its capacity as such, or against any Related Party of any of the
foregoing acting for the Administrative Agent (or any such sub-agent) or LC
Issuer in connection with such capacity. The obligations of the Lenders under
this subsection (c) are subject to the provisions of Section 2.12(d).

(d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by
applicable Law, the Loan Parties shall not assert, and hereby waive, 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 other
Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or the
use of the proceeds thereof. No Indemnitee shall be liable for any damages
arising from the use by unintended recipients of any information or other
materials distributed to such unintended recipients by such Indemnitee through
telecommunications, electronic or other information transmission systems in
connection with this Agreement or the other Loan Documents or the transactions
contemplated hereby or thereby other than for direct or actual damages resulting
from the gross negligence or willful misconduct of such Indemnitee as determined
by a final and non-appealable judgment of a court of competent jurisdiction.

 

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(e) Payments. All amounts due under this Section shall be payable on demand
therefor.

(f) Survival. The agreements in this Section shall survive the resignation of
the Administrative Agent and the LC Issuer, the assignment of any Commitment or
Loan by any Lender, the replacement of any Lender, the termination of the
Aggregate Commitments and the repayment, satisfaction or discharge of all the
other Obligations.

10.05. Payments Set Aside. To the extent that any payment by or on behalf of the
Loan Parties is made to any Credit Party, or any Credit Party exercises its
right of setoff, and such payment or the proceeds of such setoff or any part
thereof is subsequently invalidated, declared to be fraudulent or preferential,
set aside or required (including pursuant to any settlement entered into by such
Credit Party in its discretion) to be repaid to a trustee, receiver or any other
party, in connection with any proceeding under any Debtor Relief Law or
otherwise, then (a) to the extent of such recovery, the obligation or part
thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such setoff had
not occurred, and (b) each Lender and the LC Issuer severally agrees to pay to
the Administrative Agent upon demand its Applicable Percentage (without
duplication) of any amount so recovered from or repaid by the Administrative
Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to
time in effect. The obligations of the Lenders and the LC Issuer under clause
(b) of the preceding sentence shall survive the payment in full of the
Obligations and the termination of this Agreement.

10.06. Successors and Assigns.

(a) Successors and Assigns Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that no Loan Party may assign or
otherwise transfer any of its rights or obligations hereunder or under any other
Loan Document without the prior written Consent of the Administrative Agent and
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of Section 10.06(b), (ii) by way of participation in accordance with
the provisions of subsection Section 10.06(d), or (iii) by way of pledge or
assignment of a security interest subject to the restrictions of
Section 10.06(f) (and any other attempted assignment or transfer by any party
hereto shall be null and void). Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby, Participants to the
extent provided in subsection (d) of this Section and, to the extent expressly
contemplated hereby, the Related Parties of each of the Credit Parties) any
legal or equitable right, remedy or claim under or by reason of this Agreement.

(b) Assignments by Lenders. Any Lender may at any time assign to one or more
Eligible Assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitment(s) and the Loans
(including for purposes of this Section 10.06(b), participations in LC
Obligations and in Swing Line Loans) at the time owing to it); provided that any
such assignment shall be subject to the following conditions:

(i) Minimum Amounts

(A) in the case of an assignment of the entire remaining amount of the assigning
Lender’s Commitment and the Loans at the time owing to it or in the case of an
assignment to a Lender or an Affiliate of a Lender or an Approved Fund with
respect to a Lender, no minimum amount need be assigned; and

 

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(B) in any case not described in subsection (b)(i)(A) of this Section, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to
each such assignment, determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent or, if
“Trade Date” is specified in the Assignment and Assumption, as of the Trade
Date, shall not be less than $10,000,000 unless each of the Administrative Agent
and, so long as no Default has occurred and is continuing, the Lead Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed); provided, that, concurrent assignments to members of an Assignee Group
and concurrent assignments from members of an Assignee Group to a single
Eligible Assignee (or to an Eligible Assignee and members of its Assignee Group)
will be treated as a single assignment for purposes of determining whether such
minimum amount has been met;

(ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loans or the Commitment
assigned, except that this clause (ii) shall not apply to the Swing Line
Lender’s rights and obligations in respect of Swing Line Loans;

(iii) Required Consents. No consent shall be required for any assignment except
to the extent required by subsection (b)(i)(B) of this Section and, in addition:

(A) the consent of the Lead Borrower (such consent not to be unreasonably
withheld or delayed) shall be required unless (1) a Default or Event of Default
has occurred and is continuing at the time of such assignment or (2) such
assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; and

(B) the consent of the Administrative Agent (such consent not to be unreasonably
withheld or delayed) shall be required for assignments in respect of any
Commitment if such assignment is to a Person that is not a Lender, an Affiliate
of such Lender or an Approved Fund with respect to such Lender; and

(C) the consent of the LC Issuer (such consent not to be unreasonably withheld
or delayed) shall be required for any assignment that increases the obligation
of the assignee to participate in exposure under one or more Letters of Credit
(whether or not then outstanding); and

(D) the consent of the Swing Line Lender (such consent not to be unreasonably
withheld or delayed) shall be required for any assignment in respect of the
assignment of any Commitment.

(iv) Assignment and Assumption. The parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Assumption, together with
a processing and recordation fee of $3,500, provided, that, the Administrative
Agent may, in its sole discretion, elect to waive such processing and
recordation fee in the case of any assignment. The assignee, if it shall not be
a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

 

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Subject to acceptance and recording thereof by the Administrative Agent pursuant
to subsection (c) of this Section, from and after the effective date specified
in each Assignment and Assumption, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05, and 10.04 with
respect to facts and circumstances occurring prior to the effective date of such
assignment. Upon request, the Borrowers (at their expense) shall execute and
deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
Section 10.06(d).

(c) Register. The Administrative Agent, acting solely for this purpose as an
agent of the Borrowers, shall maintain at the Administrative Agent’s Office a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans and LC Obligations owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”). The entries in
the Register shall be conclusive, absent manifest error, and the Loan Parties,
the Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Lead Borrower and any Lender
at any reasonable time and from time to time upon reasonable prior notice.

(d) Participations. Any Lender may at any time, without the consent of, or
notice to, the Loan Parties or the Administrative Agent, sell participations to
any Person (other than a natural person or the Loan Parties or any of the Loan
Parties’ Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion
of such Lender’s rights and/or obligations under this Agreement (including all
or a portion of its Commitment and/or the Loans (including such Lender’s
participations in LC Obligations and/or Swing Line Loans) owing to it); provided
that (i) such Lender’s obligations under this Agreement shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations and (iii) the Loan Parties, the
Administrative Agent, the Lenders and the LC Issuer shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement. Any Participant shall agree in writing to
comply with all confidentiality obligations set forth in Section 10.07 as if
such Participant was a Lender hereunder.

Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, waiver or other modification described in the first proviso to
Section 10.01 that affects such Participant. Subject to subsection (e) of this
Section, the Loan Parties agree that each Participant shall be entitled to the
benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to Section 10.06(b).
To the extent permitted by law, each Participant also shall be entitled to the
benefits of Section 10.08 as though it were a Lender, provided such Participant
agrees to be subject to Section 2.13 as though it were a Lender.

(e) Limitations upon Participant Rights. A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04 than the applicable
Lender would have been entitled to receive with respect to the participation
sold to such Participant, unless the sale of the participation to

 

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such Participant is made with the Lead Borrower’s prior written consent. A
Participant that would be a Foreign Lender if it were a Lender shall not be
entitled to the benefits of Section 3.01 unless the Lead Borrower is notified of
the participation sold to such Participant and such Participant agrees, for the
benefit of the Loan Parties, to comply with Section 3.01(e) as though it were a
Lender.

(f) Certain Pledges. Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement (including
under its Note, if any) to secure obligations of such Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

(g) Electronic Execution of Assignments. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment and Assumption shall be
deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act.

(h) Resignation as LC Issuer or Swing Line Lender after Assignment.
Notwithstanding anything to the contrary contained herein, if at any time Wells
Fargo assigns all of its Commitment and Loans pursuant to subsection (b) above,
Wells Fargo may, (i) upon thirty (30) days’ notice to the Lead Borrower and the
Lenders, resign as LC Issuer and/or (ii) upon thirty (30) days’ notice to the
Lead Borrower, Wells Fargo may resign as Swing Line Lender. In the event of any
such resignation as LC Issuer or Swing Line Lender, the Lead Borrower shall be
entitled to appoint from among the Lenders a successor LC Issuer or Swing Line
Lender hereunder; provided, that, no failure by the Lead Borrower to appoint any
such successor shall affect the resignation of Wells Fargo as LC Issuer or Swing
Line Lender, as the case may be. If Wells Fargo resigns as LC Issuer, it shall
retain all the rights, powers, privileges and duties of the LC Issuer hereunder
with respect to all Letters of Credit outstanding as of the effective date of
its resignation as LC Issuer and all LC Obligations with respect thereto
(including the right to require the Lenders to make Base Rate Loans pursuant to
Section 2.03(c)). If Wells Fargo resigns as Swing Line Lender, it shall retain
all the rights of the Swing Line Lender provided for hereunder with respect to
Swing Line Loans made by it and outstanding as of the effective date of such
resignation, including the right to require the Lenders to make Base Rate Loans
or fund risk participations in outstanding Swing Line Loans pursuant to
Section 2.04(c). Upon the appointment of a successor LC Issuer and/or Swing Line
Lender, (a) such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring LC Issuer or Swing Line
Lender, as the case may be, and (b) the successor LC Issuer shall issue letters
of credit in substitution for the Letters of Credit, if any, outstanding at the
time of such succession or make other arrangements satisfactory to Wells Fargo
to effectively assume the obligations of Wells Fargo with respect to such
Letters of Credit.

10.07. Treatment of Certain Information; Confidentiality. Each of the Credit
Parties agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its Affiliates and to
its and its Affiliates’ respective partners, directors, officers, employees,
agents, funding sources, attorneys, advisors and representatives (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential), (b) to the extent requested by any regulatory
authority purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable Laws or regulations or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection

 

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with the exercise of any remedies hereunder or under any other Loan Document or
any action or proceeding relating to this Agreement or any other Loan Document
or the enforcement of rights hereunder or thereunder, (f) subject to an
agreement containing provisions substantially the same as those of this Section,
to (i) any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement or
(ii) any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to any Loan Party and its obligations, (g) with
the consent of the Lead Borrower or (h) to the extent such Information
(x) becomes publicly available other than as a result of a breach of this
Section or (y) becomes available to any Credit Party or any of their respective
Affiliates on a non-confidential basis from a source other than the Loan
Parties.

For purposes of this Section, “Information” means all information received from
the Loan Parties or any Subsidiary thereof relating to the Loan Parties or any
Subsidiary thereof or their respective businesses, other than any such
information that is available to any Credit Party on a non-confidential basis
prior to disclosure by the Loan Parties or any Subsidiary thereof, provided
that, in the case of information received from any Loan Party or any Subsidiary
after the date hereof, such information is clearly identified at the time of
delivery as confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.

Each of the Credit Parties acknowledges that (a) the Information may include
material non-public information concerning the Loan Parties or a Subsidiary, as
the case may be, (b) it has developed compliance procedures regarding the use of
material non-public information and (c) it will handle such material non-public
information in accordance with applicable Law, including Federal and state
securities Laws.

10.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing or if any Lender shall have been served with a trustee process or
similar attachment relating to property of a Loan Party, each Lender, the LC
Issuer and each of their respective Affiliates is hereby authorized at any time
and from time to time, after obtaining the prior written consent of the
Administrative Agent or the Required Lenders, to the fullest extent permitted by
applicable law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final, in whatever currency) at any time held and
other obligations (in whatever currency) at any time owing by such Lender, the
LC Issuer or any such Affiliate to or for the credit or the account of the
Borrowers or any other Loan Party against any and all of the Obligations now or
hereafter existing under this Agreement or any other Loan Document to such
Lender or the LC Issuer, regardless of the adequacy of the Collateral, and
irrespective of whether or not such Lender or the LC Issuer shall have made any
demand under this Agreement or any other Loan Document and although such
obligations of the Borrowers or such Loan Party may be contingent or unmatured
or are owed to a branch or office of such Lender or the LC Issuer different from
the branch or office holding such deposit or obligated on such indebtedness. The
rights of each Lender, the LC Issuer and their respective Affiliates under this
Section are in addition to other rights and remedies (including other rights of
setoff) that such Lender, the LC Issuer or their respective Affiliates may have.
Each Lender and the LC Issuer agrees to notify the Lead Borrower and the
Administrative Agent promptly after any such setoff and application, provided
that the failure to give such notice shall not affect the validity of such
setoff and application.

10.09. Interest Rate Limitation. Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not exceed the maximum rate of non-usurious interest
permitted by applicable Law (the “Maximum Rate”). If the Administrative Agent or
any Lender shall receive interest in an amount that exceeds the Maximum Rate,
the excess interest shall be applied to the principal of the Loans or, if it
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refunded to the Borrowers. In determining whether the interest contracted for,
charged, or received by the Administrative Agent or a Lender exceeds the Maximum
Rate, such Person may, to the extent permitted by applicable Law,
(a) characterize any payment that is not principal as an expense, fee, or
premium rather than interest, (b) exclude voluntary prepayments and the effects
thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal
parts the total amount of interest throughout the contemplated term of the
Obligations hereunder.

10.10. Counterparts; Integration; Effectiveness. This Agreement may be executed
in counterparts (and by different parties hereto in different counterparts),
each of which shall constitute an original, but all of which when taken together
shall constitute a single contract. This Agreement and the other Loan Documents
constitute the entire contract among the parties relating to the subject matter
hereof and supersede any and all previous agreements and understandings, oral or
written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative Agent shall
have received counterparts hereof that, when taken together, bear the signatures
of each of the other parties hereto. Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be as effective as delivery
of a manually executed counterpart of this Agreement.

10.11. Survival. All representations and warranties made hereunder and in any
other Loan Document or other document delivered pursuant hereto or thereto or in
connection herewith or therewith shall survive the execution and delivery hereof
and thereof. Such representations and warranties have been or will be relied
upon by the Credit Parties, regardless of any investigation made by any Credit
Party or on their behalf and notwithstanding that any Credit Party may have had
notice or knowledge of any Default at the time of any Credit Extension, and
shall continue in full force and effect as long as any Loan or any other
Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit
shall remain outstanding. Further, the provisions of Sections 3.01, 3.04, 3.05
and 10.04 and Article IX shall survive and remain in full force and effect
regardless of the repayment of the Obligations, the expiration or termination of
the Letters of Credit and the Commitments or the termination of this Agreement
or any provision hereof. In connection with the termination of this Agreement
and the release and termination of the security interests in the Collateral, the
Administrative Agent may require such indemnities and collateral security as it
shall reasonably deem necessary or appropriate to protect the Credit Parties
against (a) loss on account of credits previously applied to the Obligations
that may subsequently be reversed or revoked, (b) any obligations that may
thereafter arise with respect to the Bank Product Obligations and (c) any
Obligations (other than contingent indemnification obligations for which no
claim has been asserted) that may thereafter arise under Section 10.04.

10.12. Severability. If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, (a) the legality,
validity and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or
unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

10.13. Replacement of Lenders. If any Lender requests compensation under
Section 3.04, or if the Borrowers are required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 3.01, or if any Lender is a Defaulting Lender, a Deteriorating Lender
or a Non-Consenting Lender, then the Borrowers may, at their sole expense and
effort, upon notice to such Lender and the Administrative Agent, require such
Lender to assign and delegate, without recourse (in accordance with and subject
to the restrictions contained in, and consents required by, Section 10.06), all
of its interests, rights and obligations under this Agreement and the related
Loan Documents to an assignee that shall assume such obligations (which assignee
may be another Lender, if a Lender accepts such assignment), provided that:

(a) the Borrowers shall have paid to the Administrative Agent the assignment fee
specified in Section 10.06(b);

 

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(b) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans, together with accrued interest thereon,
accrued fees and all other amounts payable to it hereunder and under the other
Loan Documents (including any amounts under Section 3.05) from the assignee (to
the extent of such outstanding principal and accrued interest and fees) or the
Borrowers (in the case of all other amounts);

(c) in the case of any such assignment resulting from a claim for compensation
under Section 3.04 or payments required to be made pursuant to Section 3.01,
such assignment will result in a reduction in such compensation or payments
thereafter; and

(d) such assignment does not conflict with applicable Laws.

A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrowers to require such assignment and delegation
cease to apply.

10.14. Governing Law; Jurisdiction; Etc.

(a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

(b) SUBMISSION TO JURISDICTION. EACH LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY
SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED
STATES DISTRICT COURT OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN
DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
LOAN PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW
YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH
FEDERAL COURT. EACH OF THE LOAN PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN
ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT
THAT ANY CREDIT PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT.

(c) WAIVER OF VENUE. EACH LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED
TO IN

 

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PARAGRAPH (B) OF THIS SECTION. EACH OF THE LOAN PARTIES HERETO HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE
DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT.

(d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS
AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.

(e) ACTIONS COMMENCED BY LOAN PARTIES. EACH LOAN PARTY AGREES THAT ANY ACTION
COMMENCED BY ANY LOAN PARTY ASSERTING ANY CLAIM OR COUNTERCLAIM ARISING UNDER OR
IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL BE BROUGHT
SOLELY IN A COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY OR THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, AS THE
ADMINISTRATIVE AGENT MAY ELECT IN ITS SOLE DISCRETION, AND CONSENTS TO THE
EXCLUSIVE JURISDICTION OF SUCH COURTS WITH RESPECT TO ANY SUCH ACTION.

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

10.16. No Advisory or Fiduciary Responsibility. In connection with all aspects
of each transaction contemplated hereby, the Loan Parties each acknowledge and
agree that: (i) the credit facility provided for hereunder and any related
arranging or other services in connection therewith (including in connection
with any amendment, waiver or other modification hereof or of any other Loan
Document) are an arm’s-length commercial transaction between the Loan Parties,
on the one hand, and the Credit Parties, on the other hand, and each of the Loan
Parties is capable of evaluating and understanding and understands and accepts
the terms, risks and conditions of the transactions contemplated hereby and by
the other Loan Documents (including any amendment, waiver or other modification
hereof or thereof); (ii) in connection with the process leading to such
transaction, each Credit Party is and has been acting solely as a principal and
is not the financial advisor, agent or fiduciary, for the Loan Parties or any of
their respective Affiliates, stockholders, creditors or employees or any other
Person; (iii) none of the Credit Parties has assumed or will assume an advisory,
agency or fiduciary responsibility in favor of the Loan Parties with respect to
any of the transactions contemplated hereby or the process leading thereto,
including with respect to any amendment, waiver or other modification hereof or
of any other Loan Document (irrespective of whether any of the Credit Parties
has advised or is currently advising any Loan Party or any of its Affiliates on
other matters) and none of the Credit Parties has any obligation to any Loan
Party or any of its Affiliates with respect to the transactions contemplated
hereby except those obligations expressly set forth herein and in the other Loan
Documents; (iv) the Credit Parties and their respective Affiliates may be
engaged in a broad range of transactions that involve interests that differ

 

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from those of the Loan Parties and their respective Affiliates, and none of the
Credit Parties has any obligation to disclose any of such interests by virtue of
any advisory, agency or fiduciary relationship; and (v) the Credit Parties have
not provided and will not provide any legal, accounting, regulatory or tax
advice with respect to any of the transactions contemplated hereby (including
any amendment, waiver or other modification hereof or of any other Loan
Document) and each of the Loan Parties has consulted its own legal, accounting,
regulatory and tax advisors to the extent it has deemed appropriate. Each of the
Loan Parties hereby waives and releases, to the fullest extent permitted by law,
any claims that it may have against each of the Credit Parties with respect to
any breach or alleged breach of agency or fiduciary duty.

10.17. USA PATRIOT Act Notice. Each Lender that is subject to the Act (as
hereinafter defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Loan Parties that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”), it is required to obtain, verify and record
information that identifies each Loan Party, which information includes the name
and address of each Loan Party and other information that will allow such Lender
or the Administrative Agent, as applicable, to identify each Loan Party in
accordance with the Act. Each Loan Party is in compliance, in all material
respects, with the Act. No part of the proceeds of the Loans will be used by the
Loan Parties, directly or indirectly, for any payments to any governmental
official or employee, political party, official of a political party, candidate
for political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as amended.

10.18. Foreign Assets Control Regulations. Neither of the advance of the Loans
nor the use of the proceeds of any thereof will violate the Trading With the
Enemy Act (50 U.S.C. § 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 CFR, Subtitle B, Chapter V, as amended) (the “Foreign Assets
Control Regulations”) or any enabling legislation or executive order relating
thereto (which for the avoidance of doubt shall include, but shall not be
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 Required to
Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56)). Furthermore,
none of the Borrowers or their Affiliates (a) 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 (b) engages or will engage in any
dealings or transactions, or be otherwise associated, with any such “blocked
person” or in any manner violative of any such order.

10.19. Time of the Essence. Time is of the essence of the Loan Documents.

10.20. [Reserved].

10.21. Press Releases.

(a) Each Credit Party executing this Agreement agrees that neither it nor its
Affiliates will in the future issue any press releases or other public
disclosure using the name of the Administrative Agent or its Affiliates or
referring to this Agreement or the other Loan Documents without at least two
(2) Business Days’ prior notice to the Administrative Agent and without the
prior written consent of the Administrative Agent unless (and only to the extent
that) such Credit Party or Affiliate is required to do so under applicable Law
and then, in any event, such Credit Party or Affiliate will consult with the
Administrative Agent before issuing such press release or other public
disclosure.

(b) Each Loan Party consents to the publication by the Administrative Agent or
any Lender of advertising material relating to the financing transactions
contemplated by this Agreement

 

123

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

using any Loan Party’s name, product photographs, logo or trademark, provided,
however, that the Lead Borrower shall receive reasonable advance notice thereof.
The Administrative Agent or such Lender shall provide a draft reasonably in
advance of any advertising material to the Lead Borrower for review and comment
prior to the publication thereof. The Administrative Agent reserves the right to
provide to industry trade organizations information necessary and customary for
inclusion in league table measurements.

10.22. Additional Waivers.

(a) The Obligations are the joint and several obligation of each Loan Party. To
the fullest extent permitted by Applicable Law, the obligations of each Loan
Party shall not be affected by (i) the failure of any Credit Party to assert any
claim or demand or to enforce or exercise any right or remedy against any other
Loan Party under the provisions of this Agreement, any other Loan Document or
otherwise, (ii) any rescission, waiver, amendment or modification of, or any
release from any of the terms or provisions of, this Agreement or any other Loan
Document, or (iii) the failure to perfect any security interest in, or the
release of, any of the Collateral or other security held by or on behalf of the
Administrative Agent or any other Credit Party.

(b) The obligations of each Loan Party shall not be subject to any reduction,
limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Obligations after the termination of
the Commitments), including any claim of waiver, release, surrender, alteration
or compromise of any of the Obligations, and shall not be subject to any defense
or setoff, counterclaim, recoupment or termination whatsoever by reason of the
invalidity, illegality or unenforceability of any of the Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of
each Loan Party hereunder shall not be discharged or impaired or otherwise
affected by the failure of the Administrative Agent or any other Credit Party to
assert any claim or demand or to enforce any remedy under this Agreement, any
other Loan Document or any other agreement, by any waiver or modification of any
provision of any thereof, any default, failure or delay, willful or otherwise,
in the performance of any of the Obligations, or by any other act or omission
that may or might in any manner or to any extent vary the risk of any Loan Party
or that would otherwise operate as a discharge of any Loan Party as a matter of
law or equity (other than the indefeasible payment in full in cash of all the
Obligations after the termination of the Commitments).

(c) To the fullest extent permitted by applicable Law, each Loan Party waives
any defense based on or arising out of any defense of any other Loan Party or
the unenforceability of the Obligations or any part thereof from any cause, or
the cessation from any cause of the liability of any other Loan Party, other
than the indefeasible payment in full in cash of all the Obligations and the
termination of the Commitments. The Administrative Agent and the other Credit
Parties may, at their election, foreclose on any security held by one or more of
them by one or more judicial or non-judicial sales permitted under Part 6 of
Article 9 of the UCC, accept an assignment of any such security in lieu of
foreclosure, compromise or adjust any part of the Obligations, make any other
accommodation with any other Loan Party, or exercise any other right or remedy
available to them against any other Loan Party, without affecting or impairing
in any way the liability of any Loan Party hereunder except to the extent that
all the Obligations have been indefeasibly paid in full in cash and the
Commitments have been terminated. Each Loan Party waives any defense arising out
of any such election even though such election operates, pursuant to applicable
Law, to impair or to extinguish any right of reimbursement or subrogation or
other right or remedy of such Loan Party against any other Loan Party, as the
case may be, or any security.

(d) Each Borrower is obligated to repay the Obligations as joint and several
obligors under this Agreement. Upon payment by any Loan Party of any
Obligations, all rights of such Loan Party

 

124

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

against any other Loan Party arising as a result thereof by way of right of
subrogation, contribution, reimbursement, indemnity or otherwise shall in all
respects be subordinate and junior in right of payment to the prior indefeasible
payment in full in cash of all the Obligations and the termination of the
Commitments. In addition, any indebtedness of any Loan Party now or hereafter
held by any other Loan Party is hereby subordinated in right of payment to the
prior indefeasible payment in full of all the Obligations and no Loan Party will
demand, sue for or otherwise attempt to collect any such indebtedness until the
payment in full of the Obligations and the termination of the Commitments. If
any amount shall erroneously be paid to any Loan Party on account of (i) such
subrogation, contribution, reimbursement, indemnity or similar right or (ii) any
such indebtedness of any Loan Party, such amount shall be held in trust for the
benefit of the Credit Parties and shall forthwith be paid to the Administrative
Agent to be credited against the payment of the Obligations, whether matured or
unmatured, in accordance with the terms of this Agreement and the other Loan
Documents. Subject to the foregoing, to the extent that any Borrower shall,
under this Agreement as a joint and several obligor, repay any of the
Obligations constituting Revolving Loans made to another Borrower hereunder or
other Obligations incurred directly and primarily by any other Borrower (an
“Accommodation Payment”), then the Borrower making such Accommodation Payment
shall be entitled to contribution and indemnification from, and be reimbursed
by, each of the other Borrowers in an amount, for each of such other Borrowers,
equal to a fraction of such Accommodation Payment, the numerator of which
fraction is such other Borrower’s Allocable Amount and the denominator of which
is the sum of the Allocable Amounts of all of the Borrowers. As of any date of
determination, the “Allocable Amount” of each Borrower shall be equal to the
maximum amount of liability for Accommodation Payments which could be asserted
against such Borrower hereunder without (a) rendering such Borrower “insolvent”
within the meaning of Section 101 (31) of the Bankruptcy Code, Section 2 of the
Uniform Fraudulent Transfer Act (“UFTA”) or Section 2 of the Uniform Fraudulent
Conveyance Act (“UFCA”), (b) leaving such Borrower with unreasonably small
capital or assets, within the meaning of Section 548 of the Bankruptcy Code,
Section 4 of the UFTA, or Section 5 of the UFCA, or (c) leaving such Borrower
unable to pay its debts as they become due within the meaning of Section 548 of
the Bankruptcy Code or Section 4 of the UFTA, or Section 5 of the UFCA.

10.23. No Strict Construction. The parties hereto have participated jointly in
the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any provisions of this Agreement.

10.24. Attachments. The exhibits, schedules and annexes attached to this
Agreement are incorporated herein and shall be considered a part of this
Agreement for the purposes stated herein, except that in the event of any
conflict between any of the provisions of such exhibits and the provisions of
this Agreement, the provisions of this Agreement shall prevail.

10.25. Restatement. The terms, conditions, agreements, covenants,
representations and warranties set forth in the Existing Credit Agreement are
simultaneously amended and restated in their entirety, and as so amended and
restated, are hereby replaced and superseded, by the terms, conditions
agreements, covenants, representations and warranties set forth in this
Agreement and in the Security Agreement, and as of the Closing Date neither the
Borrowers nor the Administrative Agent and Lenders shall be subject to or bound
by any of the terms of the Existing Credit Agreement and shall only be subject
to or bound by the terms and provisions of this Agreement, except that nothing
herein or in the other Loan Documents shall, in any manner, be construed to
constitute payment of, or impair, limit, cancel or extinguish, or constitute a
novation in respect of any of the “Obligations” existing under (and as defined
in) the Existing Credit Agreement (the “Existing Obligations”) or any other
obligations, liabilities and indebtedness of the Borrowers evidenced by or
arising under the Existing Credit Agreement or impair or adversely affect the
continuation of the Liens and other interests in the Collateral heretofore
granted,

 

125

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

pledged and/or assigned by the Borrowers and Guarantors to Agent, except as
otherwise expressly set forth in the Security Agreement. All Existing
Obligations and all other loans, advances and other financial accommodations
under the Existing Credit Agreement of Borrowers to Agent and Lenders that are
outstanding and unpaid as of the date hereof pursuant to the Existing Credit
Agreement or otherwise shall be deemed Obligations of Borrowers which are
secured by Liens in the Collateral pursuant to the terms of this Agreement and
the Security Agreement. Upon the effective date of this Agreement, the
Administrative Agent shall cause to be released and satisfied the security
interests under the Existing Credit Agreement in all collateral thereunder which
is not Collateral under this Agreement and shall execute and file, or consent to
the filing by the Loan Parties of all releases and other documents reasonably
requested by the Loan Parties to effect and evidence that release.

10.26. Collateral Release on Termination. Upon the termination of this Agreement
and the payment in full of all the Obligations, the Administrative Agent shall
terminate and release all Liens in all Collateral granted to the Administrative
Agent pursuant to the Security Documents and shall execute and file, or consent
to the filing by the Loan Parties, of all releases and other documents
reasonably requested by the Loan Parties to effect and evidence that release.

 

126

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

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

 

STEIN MART, INC. By:  

/s/ Gregory W. Kleffner

Name:  

Gregory W. Kleffner

Title:  

Chief Financial Officer

STEIN MART BUYING CORP. By:  

/s/ Gregory W. Kleffner

Name:  

Gregory W. Kleffner

Title:  

Executive Vice President, Secretary

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

WELLS FARGO BANK, NATIONAL ASSOCIATION, as the Administrative Agent By:  

/s/ Jennifer Blanchette

Name:  

Jennifer Blanchette

Its Authorized Signatory

 

2

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

WELLS FARGO BANK, NATIONAL ASSOCIATION as Issuing Bank, as a Lender and Swing
Line Lender By:  

/s/ Jennifer Blanchette

Name:  

Jennifer Blanchette

Its Authorized Signatory

 

3

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

SCHEDULES

to

AMENDED AND RESTATED CREDIT AGREEMENT

These Schedules are the Schedules to the Amended and Restated Credit Agreement,
dated as of October     , 2011 (the “Agreement”), by and among Stein Mart, Inc.,
a Florida corporation, Stein Mart Buying Corp., Inc., a Florida corporation and
Wells Fargo Bank, National Association, as Administrative Agent, Collateral
Agent, LC Issuer, Swing Line Lender and a Lender. All capitalized terms used,
but not expressly defined, in these Schedules shall have the meanings set forth
in the Agreement. The headings, subheadings and other descriptive information in
these Schedules are for reference purposes only, and such shall not restrict,
expand or otherwise affect the disclosure or restrict, expand or otherwise
affect the representations and warranties in the Agreement. Any information
disclosed herein corresponding to any section or subsection of the Agreement
shall be deemed to be disclosed and incorporated in any other section of the
Schedules where the appropriateness of such disclosure in such other section is
reasonably apparent. Disclosure in these Schedules of a matter that is not
required to be disclosed does not require disclosure of any similar matters not
required to be disclosed and shall not be deemed to set or establish a different
standard of materiality than the one set forth in the representation and
warranty to which such disclosure applies.

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

Schedule 1.01(a)

EXISTING LETTERS OF CREDIT

 

Type

   ISSUE
DATE    EXPIRATION/
RENEWAL
DATE*    RENEWAL
NOTICE      BENEFICIARY    DESCRIPTION    CURRENT
AMOUNT  

SB

   8/5/2009    4/30/2012      NA       APL Logistics    Inventory at SDC    $
1,500,000   

SB

   6/27/2007    6/30 each yr*      60       American Casualty Co    Workers’
Comp    $ 677,000   

SB

   11/3/2003    10/31 each yr*      90       Travelers Indemnity    Workers’
Comp    $ 5,900,000   

SB

   7/10/2003    8/12 each yr*      30       Pacific Employers    Workers’ Comp
   $ 54,000   

SB

   7/10/2003    8/12 each yr*      30       Royal Indemnity    Workers’ Comp   
$ 315,000   

Doc

   Total                $ 0   

SB

   Total                $ 8,446,000   

Grand

   Total                $ 8,446,000       Check                $ 8,446,000   

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

Schedule 2.01

COMMITMENTS AND APPLICABLE PERCENTAGES

 

Lender

   Total Credit
Agreement Commitment      Applicable
Percentage  

Wells Fargo Bank, National Association

   $ 100,000,000         100 % 

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

Schedule 5.01

LOAN PARTIES ORGANIZATIONAL INFORMATION

 

Loan Party's Name

   State of
Incorporation    Organization
Type    Document
Number    Federal Employer
Identification Number

Stein Mart, Inc.

   Florida    Corporation    V16025    64-0466198

Stein Mart Buying Corp.

   Florida    Corporation    P97000107148    59-3481114

Stein Mart Holding Corp.

   Florida    Corporation    P08000012345    38-3790492

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

Schedule 5.05

SUPPLEMENT TO INTERIM FINANCIAL STATEMENTS

 

As of July 30, 2011

     

(In Thousands)

     

Accounts payable

      $ 105,131   

Accrued expenses and other current liabilities:

     

Compensation and employee benefits

     21,738      

Unredeemed gift certificates and return cards

     12,996      

Property taxes

     12,347      

Payroll and other taxes

     4,412      

Store closing reserve

     1,630      

Current portion of capital lease obligation

     1,665      

Other expense accruals

     10,516         65,304      

 

 

    

 

 

 

Total current liabilities

        170,435   

Other liabilities:

     

Long-term capital lease obligation

     1,659      

Split-dollar benefit liability

     6,818      

Accrued executive retirement

     2,845      

Rent liability

     8,278      

Deferred taxes

     1,797      

Long-term store closing reserve

     2,102      

Other

     394         23,893      

 

 

    

 

 

 

Total liabilities

      $ 194,328         

 

 

 

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

Schedule 5.08(b)(1)

OWNED REAL ESTATE

None.

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

Schedule 5.08(b)(2)

LEASED REAL ESTATE

 

Store #

  

City

   ST    County   

Address

   ZIP
Code   

Lessor

  

Management
Company

  

Management
Company Contact

1

   Greenville    MS    Washington    1656 Highway 1 South    38701    One South,
Inc.    One South, Inc.    (601) 378-3633

3

   Brentwood    TN    Williamson    330 Franklin Road    37027    Brentwood
Place Holding LLC    Baker Storey McDonald Management - CBRE does the accounting
   (615) 373-9511

4

   Louisville    KY    Jefferson    5055 Shelbyville Road    40207    Dixie
Associates    Dixie Associates    (502) 893-3695

5

   Little Rock    AR    Pulaski    6823 Cantrell Road    72207   
Weingarten/Arkansas, Inc.    Weingarten Realty Mgmt. Co.    (800) 688-8865

6

   Jackson    MS    Hinds    5250 I-55 North    39211    Deville Center, Inc.   
Maurice H. Joseph, Inc.    (601) 948-1701

7

   Mobile    AL    Mobile    3968 Airport Boulevard    36608    Pinebrook
Investment, LLC    Burton Brothers Management    (251) 341-5777

10

   Knoxville    TN    Knox    276 Morrell Road    37919    Centre at Deane Hill,
LLC    Isakson-Barnhart Properties    (770) 709-6600

11

   Altamonte Springs    FL    Seminole    995 State Road 434 N., Suite 100   
32714    MSKP Oak Grove, LLC    Kitson & Partners (Realty), LLC    (407)
219-3239

12

   Lexington    KY    Fayette    1555 E. New Circle Road, Suite 130    40509   
Equity Alliance of Lexington, LLC    Grand Sakwa    (248) 855-5500

13

   Baton Rouge    LA    East Baton
Rouge
Parish    9618 Airline Highway    70815    Kimco Baton Rouge 666, L.L.C.   
Kimco Realty Corp. (SM13)    (516) 869-9000

14

   Tulsa    OK    Tulsa    5112 S. Harvard Avenue    74135    Pacific Resources
Associates, LLC (PacTrust)    Property Development Assoc.    (503) 624-6300

16

   Jacksonville    FL    Duval    4399 Roosevelt Boulevard    32210    Roosevelt
Square, LLLP    Dewberry Capital Corporation    (404) 888-7990

18

   Vestavia Hills    AL    Jefferson    652 Montgomery Highway    35216    Excel
Trust, LP    AIG Baker Shopping Center Properties, LLC    (205) 969-1000

19

   Richmond    VA    Henrico    7801 West Broad Street    23294    Olde Towne
Retail Investments, LLC    Harrison & Bates, Inc.    (804) 788-1000

22

   New Orleans    LA    Orleans
Parish    5300 Tchoupitoulas Street    70115    Shadrall Riverside Market, LLC
   Auburndale Properties, LLC    (201) 930-8800

23

   San Antonio    TX    Bexar    4522 Fredericksburg Road    78201    MRO
Properties, Inc.    Weiss Realty Management, LLC    (210) 735-9137

24

   San Antonio    TX    Bexar    999 East Basse Road    78209    Alecta Real
Estate USA, LLC    Reata Property Management    (210) 841-3214

25

   Tallahassee    FL    Leon    1400-31 Village Square Boulevard    32312   
Kimco Tallahassee 715, Inc.    Kimco Realty Corporation    (516) 869-9000

26

   Raleigh    NC    Wake    4500 Falls of the Neuse, Suite 110    27609   
Sterling (The Falls) Limited Partnership    Sterling Centrecorp Realty and
Management Services    (704) 847-0225

27

   Austin    TX    Travis    2900 West Anderson Lane    78757    Northwood
Properties, Ltd.    Pyramid Properties, Inc.    (512) 472-1585

28

   Greenville    SC    Greenville    101 Verdae Boulevard    29607    SCI Verdae
Fund, LLC    The Shopping Center Group    (770) 955-2434

30

   Overland Park    KS    Johnson    14401 Metcalf Avenue    66223    Lionsgate
Marketplace LLC       (913) 491-8900

31

   Tampa    FL    Hillsborough    3916 Britton Plaza    33611    Charles J.
Bickimer, Trustee    Bruce Strumpf, Inc.    (727) 449-2020

32

   Memphis    TN    Shelby    827 South White Station Road    38117    Eastgate
Center, LLC    Belz Enterprises    (901) 260-7346

33

   Pensacola    FL    Escambia    1660 Airport Boulevard    32504    VIF II
Cordova Associates, LLC    GMH Capital Partners    (904) 636-0616

36

   Greensboro    NC    Guilford    3729 Battleground Avenue    27410    SS
Brassfield, LLC    CBL & Associates Management, Inc.    (336) 299-2800

37

   Jacksonville    FL    Duval    11111-80 San Jose Boulevard    32223   
Riverplace Shopping Center, LLC    Kimco Realty Corporation   

38

   Richmond    VA    Chesterfield    9746 Midlothian Turnpike    23235    Sauer
Properties, Inc.    Commonwealth Commercial Partners, Inc.    (804) 346-4966

40

   Metairie    LA    Jefferson
Parish    2840 Veterans Memorial Boulevard    70002    Eagle Equity Ltd #3   
Select Properties, Ltd Realty    (504) 833-0044

41

   Huntsville    AL    Madison    975 Airport Road    35802    Huntsville Store
Company, Inc.    Aronov Realty Company    (334) 277-1000

42

   Cary    NC    Wake    240 Crossroads Boulevard    27518    Cary Crossroads
(DE), LLC    Ronus Properties, LLC    (919) 233-8087

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

43

   Charleston    SC    Charleston    975 Savannah Highway    29407    St.
Andrews Shopping Center Corp. of Charleston    Kimco Realty Corp.   
(704) 367-0313

44

   Oklahoma City    OK    Oklahoma    4916 North May Avenue    73112    B.R.
Mayfair Center, LLC    Price Edwards & Company    (405) 843-7474

45

   Jacksonville Beach    FL    Duval    3818 South 3rd Street    32250    IRT
Property Company    Equity One Realty & Management, Inc.    (305) 672-1234

46

   Shreveport    LA    Caddo
Parish    4801 Line Avenue    71106    Stoneridge Auto, LLC    Avant Properties,
LLC    (318) 227-7622

47

   Winston-Salem    NC    Forsyth    400 South Stratford Road    27103   
Thruway Shopping Center LLC    Windham Management Co.    (301) 986-6000

48

   Pineville    NC    Mecklenburg    10416 Centrum Parkway    28134    Pineville
Centrum Limited Partnership    Kimco Realty Corporation    (516) 869-9000

49

   Virginia Beach    VA    Princess Ann    4554 Virginia Beach Boulevard, Suite
680    23462    Pembroke Square Associates, GP    Jones Lang LaSalle Americas,
Inc    (757) 490-3141

50

   Lubbock    TX    Lubbock    7020 Quaker Avenue    79424    Hartford-Lubbock
Limited Partnership       (860) 646-6555

51

   Boca Raton    FL    Palm Beach    9831 Glades Road    33434    Shadowwood
Square Ltd.    RMG Managers, LLC    (954) 874-2936

52

   Palm Harbor    FL    Pinellas    33591 U.S. 19 North    34684    Highland
Lakes Shopping Plaza, Ltd.    Colliers Arnold    (727) 442-7184

53

   Augusta    GA    Richmond    2834 Washington Road    30909    Forum W.S., LLC
   Forum Management    (404) 873-6900

55

   McAllen    TX    Hidalgo    1812 South 16th Street    78503    TCP Main Place
Partners, L.P.    TCP Realty Services, LLC    (713) 243-6800

56

   Houston    TX    Harris    2640 Fondren Road    77063    Piney Point Shopping
Center    RPI Management Company    (713) 662-7745

57

   Fort Myers    FL    Lee    13300 South Cleveland Avenue    33907    DDRTC
Cypress Trace LLC    Developers Diversified Realty Corporation    (941) 371-5301

58

   Tampa    FL    Hillsborough    13210 North Dale Mabry Highway    33618   
Regency Realty Corporation #58    Regency Realty Corp    (904) 598-7000

60

   Kettering    OH    Montgomery    100 East Stroop Road    45429    Dayton Town
& County, G.P.    Don Casto Organization    (614) 228-5331

62

   Cincinnati    OH    Hamilton    2692 Madison Road    45208    CLP-SPF
Rookwood Pavillion, LLC    Jeffrey R. Anderson Real Estate    (513) 241-5800

63

   Nashville    TN    Davidson    92 White Bridge Road    37205    Centro GA
Lion’s Head Village, LLC    ERT Australian Management, L.P. (subsidiary of New
Plan)   

65

   Fort Worth    TX    Tarrant    6385 Camp Bowie Boulevard    76116    Centro
NP Holdings 12 SPE, LLC    CA New Plan Management, Inc.    (713) 660-4300

66

   Webster    TX    Harris    19801 Gulf Freeway    77598    Price/Baybrook Ltd.
   Kimco Realty Corp    (516) 869-9000

67

   Birmingham    AL    Shelby /
Jefferson    5275 Hwy 280 South, Suite 119    35242    GS II Brook Highland, LLC
   Developers Diversified Realty Corporation    (216) 755-5500

68

   Amarillo    TX    Randall    3315 Bell Street    79106    Barbara and Ford
Madison dba The Village on Bell       (806) 655-0050

70

   Houston    TX    Harris    5319 A F.M. 1960 West    77069    WRI HR Venture
Properties I LLC    Weingarten Realty Investors, Inc.    (800) 688-8865

71

   Indianapolis    IN    Marion    1488 West 86th Street    46260    North
Willow Commons Associates    The Broadbent Company    (317) 237-2900

72

   Arlington    TX    Tarrant    452 Lincoln Square    76011    Lincoln Square
Dunhill LP    Lincoln Square Ltd.    (817) 461-7953

73

   Marietta    GA    Cobb    1309 Johnson Ferry Road    30068   

Merchants Walk

(E & A), LLC.

   Edens & Avant Properties    (770) 569-5509

74

   Cincinnati    OH    Hamilton    11315 Montgomery Road    45249    Centro NP
Holdings 3 SPE, LLC    New Plan Excel Realty Trust, Inc.    (713) 660-4300

75

   Raleigh    NC    Wake    7444 Creedmoor Road    27613    WRI/Raleigh LP   
Weingarten Realty Management Company    (713) 866-6000

76

   Sarasota    FL    Sarasota    6535 South Tamiami Trail    34231    Inland
American Sarasota Tamiami, LLC    Inland American Retail Management, LLC   
(770) 980-8178

78

   Dallas    TX    Dallas    14902 Preston Road    75254    Prestonwood Market
Square II, Ltd.    Henry S. Miller Devmt Group    (972) 386-1419

79

   Austin    TX    Travis    3201 Bee Caves Road, Suite 140    78746   
Randall’s Food and Drugs, Inc.    Property Development Associates    (713)
268-3650

80

   Scottsdale    AZ    Maricopa    8662 East Shea Boulevard    85260    Regency
Centers, L.P.    Regency Centers, L.P.    (904) 598-7000

81

   Columbus    GA    Muscogee    1625 Bradley Park Drive, Suite 1    31904   
Bradley Park Square Ltd.    Aronov Realty Mgmt, Inc.    (334) 277-1000

82

   Tyler    TX    Smith    2125 South Broadway    75701    Weingarten Realty
Investors    Weingarten Realty Investors    (800) 688-8865

84

   Houston    TX    Harris    290 Meyerland Plaza    77096    Myerland Plaza
(DE), LLC    Ronus Properties, LLC    (713) 664-1166

85

   Tucson    AZ    Pima    4881 North Stone Avenue    85704    Centro NP
Holdings 1 SPE, LLC    New Plan Excel Realty Trust    (212) 869-3000

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

87

   Terre Haute    IN    Vigo    #43 Meadows Shopping Center    47803    Terre
Haute Realty Corporation    Ragle & Company    (812) 234-8899

89

   Hattiesburg    MS    Forrest    5912 U.S. Highway 49    39401    Equity
Alliance of Hattiesburg, LLC    Grand Sakwa Management, LLC    (248) 855-5500

90

   Lafayette    LA    Lafayette
Parish    5700 Johnston Street    70503    Kimco Acadiana 670, L.L.C.    Kimco
Realty Corporation    (516) 869-7277

91

   Plano    TX    Collin    1701 Preston, Suite A    75093    Preston Shepard
Retail LP    Weingarten Realty Investors   

92

   Dunwoody    GA    Fulton    1155 Mount Vernon Highway    30338    DDR
Perimeter Pointe LLC    Developers Diversified Realty Corporation    (216)
755-5500

93

   Gilbert    AZ    Maricopa    891 North Val Vista Drive, Suite 102    85234   
Patterson Farms, Inc.    Patterson Properties, Inc.    (480) 838-8777

94

   Roanoke    VA    Roanoke    4230 Electric Road    24018    Roanoke
Tanglewood, LLC    Urban Retail Properties, Co.    (540) 989-4685

96

   Asheville    NC    Buncombe    848 Merrimon Avenue    28804    Sky King, Inc.
   Sky King, Inc.    (828) 669-2941

97

   Matthews    NC    Mecklenburg    1813 Matthews Township Pkwy.    28105   
Matthews Festival Shopping Center, Inc.    CB Richard Ellis    (704) 553-7567

98

   Kingwood    TX    Harris    1153 Kingwood Drive    77339    VIF Kingwood S/C
Partners, L.P.    Henry S. Miller Multi Management, Inc.    (713) 626-2828

100

   Savannah    GA    Chatham    7804 Abercorn Street #55    31406    Oglethorpe
Mall, L.L.C.    General Growth Properties, Inc.    (912) 354-7038

102

   Peachtree City    GA    Fayette    180 Peachtree East Shopping Ctr.    30269
   Peachtree East Shopping Center    Retail Planning Corporation    (770)
956-8383

103

   Fayetteville    NC    Cumberland    2800 Raeford Road    28303    Highland
Centre    Highland Centre    (910) 484-3011

104

   Centennial    CO    Arapahoe    8181 South Quebec Street    80112    Quebec
Village JG, Limited    J.G. Management Co., Inc.    (818) 707-9494

105

   Fort Wayne    IN    Allen    6325 West Jefferson Boulevard    46804   
Village at Time Corners, LP    The Broadbent Company    (317) 237-2900

107

   Biloxi    MS    Harrison    2363 Pass Road    39531    Selcast SA, Inc.      

108

   Lakeland    FL    Polk    3615 South Florida Avenue    33803    Kimco
Lakeland 123, Inc.    Kimco Realty Corporation    (516) 869-9000

112

   Irving    TX    Dallas    7640 North MacArthur Boulevard    75063    Inland
Western Irving Limited Partnership    Inland Southwest Management LLC    (630)
218-8000

113

   Colorado Springs    CO    El Paso    7710 North Academy Boulevard    80920   
Chapel Hills-West LLC    Summit Commercial Group    (719) 520-1000

116

   Allentown    PA    Lehigh    3300 Lehigh Street    18103    PR Financing
Limited Partnership    PREIT Services, LLC    (215) 875-0700

117

   Stafford    TX    Fort Bend    12656 Fountain Lake Circle    77477   
Fountains Dunhill, LLC    Dunhill Property Management    (214) 373-7500

118

   North Little Rock    AR    Pulaski    2727 Lakewood Village Drive    72116   
Conservative Development Co.    Ashley Company    (501) 758-7745

119

   Orlando    FL    Orange    2530 East Colonial Drive    32803    Weingarten
Nostat, Inc.    Weingarten Realty Management Company    (800) 688-8865

120

   Chesapeake    VA    Chesapeake    1228 Greenbrier Parkway    23320    CP
Venture Two LLC    Cousins Properties, Inc.    (404) 407-1000

121

   Glendale    AZ    Maricopa    5960 West Bell Road    85308    PDSI, Inc.   
Gateway Property Management    (215) 540-8125

122

   Beaumont    TX    Jefferson    4436 North Dowlen Road    77706    Wu Family
Trust    Wu Property Management, Inc.    (626) 836-6925

123

   Dallas    TX    Dallas    6465 East Mockingbird Lane, Suite 322    75214   
TRP Hillside, LLC    Twinrose Investments    (214) 989-4152

124

   Katy    TX    Harris    1747 Fry Road    77449    Galileo Apollo I TX LP   
ERT Australian Management, L.P. (subsidiary of New Plan)   

125

   Naples    FL    Collier    8811 North Tamiami Trail    34108    Musca
Properties, LLC    Musca Properties, LLC    (216) 642-9500

126

   Midland    TX    Midland    4706 North Midkiff Road, #1    79705    Pilchers
North Park Limited Partnership    The Pilchers Group    (214) 520-2800

127

   Johnson City    TN    Washington    3211 People Street, Bldg. H    37604   
Johnson City Crossing (Delaware), LLC    Ronus Properties, LLC    (919) 233-8087

130

   Columbus    OH    Franklin    3628 West Dublin-Granville Road    43235    Sun
Center, Ltd.    DDR Continental LP    (216) 755-5500

132

   San Antonio    TX    Bexar    18134 San Pedro    78232    Northwoods Center,
Inc.    Barshop & Oles Company    (512) 477-1212

134

   Toledo    OH    Lucas    3315 W.Central Avenue, Suite A3-10    43606   
Westgate Village Retail, LLC    Westgage Village Shopping Ctr.    (312) 341-9000

135

   Evansville    IN    Vanderburgh    880 South Green River Road    47715   
Gateway Arthur, Inc.    Emmes Realty Services LLC    (212) 293-3593

136

   Brookfield    WI    Waukesha    16950 West Bluemound Road    53005   
Metropolitan Life Insurance Company    Urban Retail Properties Co.    (262)
938-0911

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

137

   Athens    GA    Clarke    196 Alps Road, Suite 34    30606    OZ CLP
Beechwood LLC    Select Strategies Brokerage    (205) 873-3445

139

   Gainesville    FL    Alachua    6111A N.W. 8th Avenue    32605    The
Coalition Partnership    The Coalition Partnership    (904) 354-9000

140

   Rockwall    TX    Rockwall    2855 Ridge Road    75032    Steger Towne
Crossing, L.P.    Trinity Interests    (972) 503-9444

141

   Marietta    GA    Cobb    50 Barrett Parkway, Suite 100    30066    DDR Prado
LLC    Developers Diversified Realty Corporation    (216) 755-5500

143

   Henderson    NV    Clark    500 North Stephanie Street    89014    Galileo
Galleria, LLC    ERT Australian Management, L.P. (subsidiary of New Plan)   
(212) 869-3000

146

   Kansas City    MO    Platte    8331 N.W. Roanridge Road    64151    Cole MT
Kansas City MO, LLC    Cole Companies    (602) 778-8728

148

   Reno    NV    Washoe    5069 South McCarran Boulevard    89502    Meyer
Properties, L.P.    Meyer Properties    (800) 675-8181

149

   Cordova    TN    Shelby    1635 Germantown Parkway    38016    WRI HR Venture
Properties I LLC    Weingarten Realty Management Company    (800) 688-8865

153

   Coral Springs    FL    Broward    9150 Wiles Road    33067    Coral Springs
Joint Venture, G.P.    Simon DeBartalo/Mgmt Assoc.    (317) 263-2313

154

   Poway    CA    San Diego    13644 Poway Road    92064    Poway City S.C.,
L.P.    Kimco Realty Corporation    (516) 869-9000

155

   Williamsville    NY    Erie    7992 Transit Road    14221    DDR MDT
Williamsville Premier Place LLC    Developers Diversified Realty Corporation   
(216) 755-5500

158

   Seminole    FL    Pinellas    11201 Park Boulevard, #73    33772    Downtown
Seminole, LLC    RMC Property Group    (813) 960-8154

160

   Pompano Beach    FL    Broward    1115 South Federal Highway    33062    SVP
Real Estate Partners No.1, LP    Terranova Corporation    (305) 695-8700

161

   Laredo    TX    Webb    4601 San Dario Street    78041    H.E. Butt Property
Co. No. One    H.E. Butt Grocery Company    (210) 938-8290

167

   Cornelius    NC    Mecklenburg    20601 Torrence Chapel Road    28031    DDR
Southeast Southlake, LLC    DDR Mid- Atlantic Management LLC    (216) 755-6455

173

   Mission Viejo    CA    Orange    25282 Marguerite Parkway    92692    The
Lueck Family Partnership    Robert B. Lueck    510.834.4350 ext 106

174

   Snellville    GA    Gwinnett    1670 Scenic Highway North    30078    DDR
Southeast Snellville, L.L.C.    DDR Southern Management Corp.    (216) 755-6455

175

   Columbia    SC    Richland    4840 Forest Drive    29206    Trenholm Plaza
(E&A), LLC    Edens & Avant Comm Real Estate    (803) 779-4420

177

   Austin    TX    Travis    13729 Research Boulevard    78750    Federal
Wholesale Toy Co, Limited Partnership    Endura Advisory Group    (512) 448-4811

180

   Orlando    FL    Orange    7506 Dr. Phillips Boulevard    32819    WRI-TC
Marketplace at Dr. Phillips, LLC    Weingarten Realty Investors   

181

   Edmond    OK    Oklahoma    308 South Bryant Avenue    73034    SCI Bryant
Square Fund, LLC    Price Edwards & Company    (405) 843-7474

182

   Wheaton    IL    DuPage    191 Rice Lake Square    60187    Danada Centers
LLC    Mid-America Asset Management, Inc.    (630) 954-7300

183

   Farragut    TN    Knox    11437 Kingston Pike    37922    White Realty &
Service Corp.    White Realty & Service Corp.    (865) 588-2244

184

   Virginia Beach    VA    Virginia
Beach    748 Hilltop North    23451    SuSu Developers    S.L. Nusbaum Realty
Co.    (800) 208-8611

185

   Venice    FL    Sarasota    1560 U.S. 41 Bypass    34293    Selig
Enterprises, Inc.    Selig Enterprises, Inc.    (404) 876-5511

186

   Westlake    OH    Cuyahoga    25001 Center Ridge Road    44145    Westlake
Home Improvement Associates, Ltd    Westlake Home Improv. Assoc.    (800)
473-7253

187

   Las Vegas    NV    Clark    8125 West Sahara Avenue    89117    El Cerrito
Plaza Company, LLC    Dolmar, Inc    (310) 278-2036

188

   Myrtle Beach    SC    Horry    7621 North Kings Highway    29572    Northwood
Plaza, LLC    Rivercrest Realty Associates    (919) 846-4046

190

   Florence    SC    Florence    1945 West Palmetto Street, Suite 390    29501
   Florence Mall (E&A), LLC    Edens & Avant    (803) 779-4420

192

   Mandeville    LA    St.
Tammany
Parish    3450 Highway 190, Suite 2    70470    Premier Centre, LLC    Stirling
Properties    (504) 898-2022

193

   Houston    TX    Harris    6148 Highway 6 North    77084    BRE Retail
Residual Owner 1, LLC    New Plan Excel Realty Trust    (212) 869-3000

194

   St. Petersburg    FL    Pinellas    218 37th Avenue North    33704    Publix
Super Markets, Inc.    Publix    (863) 688-1188

198

   Rancho Cucamonga    CA    San
Bernardino    10930 Foothill Boulevard    91730    The J. Coleman Travis Trust
   Glacier Peak Management Services, Inc.    (858) 578-3220

199

   Stevenson Ranch    CA    Los Angeles    24955 Pico Canyon Road    91381   
H.E. Danielli II, LLC    DSB Properties, Inc.    (805) 374-1700

201

   Chattanooga    TN    Hamilton    2020 Gunbarrel Road, Suite 174    37421   
Hamilton Village (Delaware), LLC    Ronus Properties, LLC    (678) 553-4000

202

   High Point    NC    Guilford    1589 Skeet Club Road, Suite 105    27265   
CBL-Oak Hollow Square, LLC    CBL & Associates Management, Inc.   

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

203

   Spartanburg    SC    Spartanburg    1925 East Main Street    29307    ERP
Hillcrest, LLC    New Plan Excel Realty Trust, Inc.   

204

   Plantation    FL    Broward    8319 West Sunrise Boulevard    33322   
Plantation Realty Associates, LLC    American Commercial Realty   
(561) 775-1300

205

   Macon    GA    Bibb    4357 Forsyth Road, Suite 120    31210    Fund Rivoli
Center, LLC    Bell Partners    (336) 232-1928

206

   Arlington    TX    Tarrant    5906 South Cooper Street    76017    Rip
Griffin Truck Service Center, L.P.    Henry S. Miller Multi Management, Inc.   
(817) 656-5254

207

   Tuscaloosa    AL    Tuscaloosa    2600 McFarland Boulevard E., Suite S   
35405    DDRTC McFarland Plaza LLC    Developers Diversified Realty Corporation
   (256) 859-6122

208

   Tulsa    OK    Tulsa    7827 East 91st Street    74133    Goldberg/Goldberg
Partnership, LP    Goldberg/Goldberg Partnership, LP    (913) 385-9996

210

   Fullerton    CA    Orange    1936 North Placentia Avenue    92831    American
Stores Company, LLC    SUPERVALU   

212

   Hilton Head Island    SC    Beaufort    430 William Hilton Prkwy., Suite 101
   29926    Pineland Associates, LLC    Perrine & Wheeler Real Estate Company   
(757) 627-9088

213

   Hickory    NC    Catawba    2990 North Center Street    28601    Triangle
Properties Assoc. LLC    Southern Real Estate    (704) 375-1000

214

   Fresno    CA    Fresno    3070 West Shaw Avenue    93711    AMI Winepress,
Ltd.    AMI Winepress, Ltd.    (559) 224-8100

215

   Destin    FL    Okaloosa    4437 Commons Drive East    32541    WR Paradise
key, LLC    Weingarten Realty Investors    (713) 866-6000

217

   College Station    TX    Brazos    2408 B Texas Avenue South    77840    FSC
Parkway, LLC    Cencor Realty Services    (713) 781-7111

219

   Orland Park    IL    Cook    204 Orland Park Place    60462    Inland Orland
Park Place, L.L.C.    Inland Commercial Property Management, Inc.   

877.206.5656

(toll free)

220

   Temecula    CA    Riverside    31781 U.S. Highway 79 South    92592   
Galileo Vail Ranch, LP    ERT Australian Management, L.P. (subsidiary of New
Plan)    (713) 660-4300

221

   Lexington    SC    Lexington    934 North Lake Drive    29072    Lexington
Towne Center (E&A), LLC    Edens & Avant    (803) 779-4420

222

   Shenandoah    TX    Montgomery    19075 Interstate Highway 45 South    77385
   OZ/CLP Portofino, LP    Select Strategies Brokerage    (936) 321-0934

223

   Daytona Beach    FL    Volusia    2500 W. Int’l Speedway Boulevard, #700   
32114    International Speedway Square, LTD    Kite Realty Group    (317)
577-5600

224

   St. Charles    IL    Kane    3619 East Main Street    60174    Covington Main
Street Commons Acquisitions, LLC    Covington Property Management, LLC    (312)
879-7535

226

   Greenville    NC    Pitt    115 Red Banks Road    27858    Sterling Rental
Company, LLC    Jon Day & Associates, Inc.    (252) 756-1119

229

   Palm Springs    CA    Riverside    1555 South Palm Canyon Dr., Suite F   
92264    John Wessman d/b/a Wessman Development Company    Spinello Property
Management, Inc.   

230

   Stuart    FL    Martin    2508 S.E. Federal Highway    34994    SPC Regency,
LLC       (772) 288-0700

232

   Kenner    LA    Jefferson
Parish    393 West Esplanade Avenue    70065    Folmar Kenner, LLC    Folmar &
Associates, LLP    (334) 343-3777

233

   Frisco    TX    Collin    3333 Preston Road, Suite 1500    75034    BPR
Shopping Center, L.P.    New Plan Excel Realty Trust, Inc.    (972) 668-2986

234

   Salt Lake City    UT    Salt Lake    1400 Foothill Drive, #130    84108   
JTJG Foothill Village, L.C.    Johansen-Thackeray Commercial Real Estate
Services    (801) 487-6670

236

   Franklin    TN    Williamson    1010 Murfreesboro Road, Suite #194    37064
   Transamerica Life Insurance Company    Colliers Turley Martin Tucker    (615)
238-3671

237

   El Paso    TX    El Paso    7401 Mesa Street    79912    Kadosh Investments,
Inc.    Kim Martin Company, Inc.    (817) 336-1880

238

   Collierville    TN    Shelby    3655 Houston Levee Road    38017    Cole MT
Collierville TN, LLC    Cole Companies    (602) 778-8700

239

   Murrells Inlet    SC    Horry    10125 Highway 17 Bypass, Box #16A    29576
   Murrells Retail Associates, LLC    Urban Retail Properties, LLC   

240

   Melbourne    FL    Brevard    4100 North Wickham Road, Suite #132    32935   
Post and Wickham Corporation    Commercial Real Estate    (954) 761-8330

243

   Cooper City    FL    Broward    5800 S. Flamingo Road    33330    IRT
Property Company    Equity One Realty & Management, Inc.    (305) 672-1234

245

   Chino Hills    CA    San
Bernardino    13031 Peyton Drive    91709    CRCH, LLC    Realtyland    (213)
252-0073

246

   Huntington Beach    CA    Orange    19041 Beach Boulevard    92648   
SunBrewer Partners, L.P.    West Coast Management    (858) 538-7500

247

   Wilmington    NC    New
Hanover    3501 Oleander Drive, Building 1    28403    The Oleander Company,
Inc.    The Oleander Company, Inc.    (910) 392-3300

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

248

   La Verne    CA    Los Angeles    1375 Foothill Boulevard    91750    La Verne
CP Acq, La Verne Duke Street LLC & La Verne Oxon Hill LLC, as tenants in common
   Combined Properties, Inc.    (310) 205-9616

249

   Huntsville    AL    Madison    6275 University Dr., NW, Suite 17    35806   
DDRTC Westside Centre LLC    Developers Diversified Realty Corporation    (256)
859-6122

250

   Portage    MI    Kalamazoo    581 Romence Road    49024    Romence Village,
LLC    Forest City Commercial Management, Inc.    (216) 621-6060

251

   Yorba Linda    CA    Orange    20535 Yorba Linda Boulevard    92886    The
Vons Companies, Inc.    Property Development Associates    (626) 821-6100

252

   Ballwin    MO    Saint Louis    14820 Manchester Road    63011    Olde Towne
Plaza, LLC    The Bedrin Organization    (201) 612-8800

253

   Daphne    AL    Baldwin    6850 Highway 90, Suite 14    36526    AIG Baker
Daphne, L.L.C.    AIG Baker Shopping Center Properties, LLC    (205) 969-1000

255

   Midlothian    VA    Chesterfield    4740 Commonwealth Center Pkwy.    23112
   DDRTC Commonwealth II, LLC    Developers Diversified Realty Corporation   
(410) 535-5490

261

   San Antonio    TX    Bexar    12651 Vance Jackson Road, #125    78230    WRI
Fiesta Trails, LP    Weingarten Realty Management    (800) 688-8865

262

   Bonita Springs    FL    Lee    25191 Chamber of Commerce Drive    34135   
Prado Acquisition LLC    Wharton Realty Group, Inc.    (732) 935-0111

265

   Leesburg    VA    Loudoun    1021 Edwards Ferry Road NE    20176    CH Realty
III/Battlefield, LLC    Kimco Realty Corporation    (410) 684-2000

266

   Mount Pleasant    SC    Charleston    600 Long Point Road    29464   
Belle-Hall Shopping Center II, LLC    AAC Real Estate Services, Inc.    (704)
295-4000

267

   Tampa Palms    FL    Hillsborough    16061 Tampa Palms Boulevard, W.    33647
   PERA City Plaza Tampa, Inc.    Colliers International    (727) 442-7184

268

   Ocala    FL    Marion    2800 SW 24th Avenue, Suite 200    34474    Boyd
Market Center, Inc.    Ocala Properties, Inc    (352) 861-2248

269

   Orchard Park    NY    Erie    3207 Southwestern Boulevard    14127    DDR
Orchard Park LLC    Developers Diversified Realty Corporation    (216) 755-5500

270

   Riverside    CA    Riverside    335 East Alessandro Boulevard    92508   
Mission Grove Plaza, LP    Mission Grove Plaza    (310) 553-1776

271

   Columbus    OH    Franklin    4870 Morse Road    43230    Highland
Properties, Inc.    Don M. Casto Organization    (614) 228-5331

272

   Jackson    TN    Madison    175 Stonebrook Place    38305    Broadmoor
Investment Corp.    Lurie & Associates, LLC    (901) 794-6022

273

   Granada Hills    CA    Los Angeles    10801 Zelzah Avenue    91344    FW
CA-Granada Village, LLC    Regency Realty Group, Inc.   

274

   Irvine    CA    Orange    4730 Barranca Parkway    92604    The Irvine
Company    The Irvine Company    (949) 720-3100

275

   Greenwood    IN    Johnson    1011 North State Road 135    46142    R.P.
Wurster, LP    Maquina Realty Corporation    (317) 579-9700

276

   Fort Worth    TX    Tarrant    5026 South Hulen Street    76132    Rancho
Hulen Ridge, L.P.    Pacific Commercial Management, Inc.    (858) 450-6886

277

   Hoover    AL    Jefferson    2792 John Hawkins Parkway    35244    Colonial
Realty Limited Partnership    Colonial Properties Trust    (205) 871-0406

278

   Williamsburg    VA    James City    161 Monticello Avenue    23185   
Williamsburg Improvements, LLC    DLC Management Corporation    (914) 631-3131

279

   Richmond    VA    Henrico    3544 Pump Road    23233    Sauer Properties,
Inc.    Commonwealth Commercial Partners, Inc.    (804) 346-4966

280

   Albany    GA    Dougherty    2709 Dawson Road    31707    EIG Albany Square,
LLC    Equity Investment Group    (260) 426-4704

281

   Valrico    FL    Hillsborough    3456 Lithia-Pinecrest Road    33596    KRG
Lithia, LLC    Kite Realty Group    (317) 577-5600

283

   Charlotte    NC    Mecklenburg    5341 Ballantyne Commons Pkwy., #200   
28277    Promenade Shopping Center, LLC    Childress Klein Properties    (704)
342-9000

284

   Clearwater    FL    Pinellas    2522 North McMullen Booth Road    33761   
NWP Clearwater Holdings LLC    The Sembler Company    (727) 384-6000

286

   Palm Beach Gardens    FL    Palm Beach    11700 U.S. Highway 1    33408   
Oakbrook Square Shopping Center Corporation    Equity One Realty & Management,
Inc.    (561) 625-4655

288

   Jacksonville    FL    Duval    10915 Baymeadows Road, #26    32256    KSP1
Point Meadows, LLC    KSP1 Point Meadows, LLC    (954) 354-8282

289

   Vero Beach    FL    Indian River    1225 U.S. Highway 1, Suite 2    32960   
Vero Mall LLC    Paul Hanna Management, Inc.   

toll free

888.478.7701

also

561-655-5337

290

   Chapel Hill    NC    Orange    1800 E. Franklin Street, Suite 13    27514   
Federal Realty Investment Trust    Federal Realty Investment Trust    (301)
998-8100

291

   Cherry Hill    NJ    Camden    1600 Kings Highway North, Suite 20    08034   
Federal Realty Investment Trust    Federal Realty Investment Trust    (301)
998-8100

293

   Downingtown    PA    Chester    60 Quarry Road    19335    Brandywine Square,
LLC       (610) 873-5585

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

294

   La Quinta    CA    Riverside    78-945 Highway 111    92253    SM La Quinta,
LLC       (760) 775-7967

295

   Flowood    MS    Rankin    150 Promenade Boulevard    39232    ARC Dogwood
Promenade, LLC    Aronov Realty Management, Inc.    (334) 277-1000

296

   Jenkintown    PA    Montgomery    913 Old York Road    19046    Genuardi’s
Family Markets, LP (subsidiary of Safeway, Inc)      

297

   Carmel    IN    Hamilton    2520 East 146th Street    46033    Westfield One,
LLC      

298

   Casselberry    FL    Seminole    1455 Semoran Boulevard, Suite 251    32707
   Inland Southeast Casselberry, L.L.C.    Developers Diversified Realty
Corporation    (407) 971-1820

299

   Ocean    NJ    Monmouth    1100 Highway 35    07712    Sunset Arcadia Center,
Inc.    Stavola Realty Company    (732) 542-2328

301

   Boynton Beach    FL    Palm Beach    334 North Congress Avenue    33426   
Oakwood Square (E&A), LLC    Edens & Avant    (407) 261-9111

302

   Kildeer    IL    Lake    20771 North Rand Road    60047    Centro/IA Quentin
Collection, LLC    Centro Prop    (630) 736-7200

303

   Montgomery    AL    Montgomery    7860 Vaughn Road    36116    Cornerstone,
L.L.C.    Aronov Realty Management, Inc.    (334) 277-1000

304

   Chandler    AZ    Maricopa    2835 South Alma School Road    85286    Vestar
California XXII, L.L.C.    Vestar Property Management    (602) 993-1626

307

   Deerfield    IL    Lake    35 North Waukegan Road    60015    Office Depot
(sublessor)    Office Depot   

309

   Jacksonville    FL    Duval    13475 Atlantic Blvd    32225    Harbour
Village Holdings, L.L.C.    Global Realty & Management FL, Inc    (904) 716-9300

310

   Royal Palm Beach    FL    Palm Beach    11061 Southern Boulevard    33411   
The Centre On Southern LLLP    Merin Hunter Codman, Inc.    (561) 791-1637

311

   Rocklin    CA    Placer    6676 Lonetree Boulevard    95765    Rocklin
Retail, LLC    Kennedy Wilson    (916) 927-1000

312

   Southern Pines    NC    Moore    10564 U.S. Highway 15-501    28387    SAM
Southern Pines LLC    Developers Diversified Realty Corporation    (919)
383-8000

313

   Bluffton    SC    Beaufort    71 Towne Drive    29910    Equity One
(Southeast Portfolio), Inc.    Equity One Realty & Management SE, Inc.    (770)
955-4406

314

   McKinney    TX    Collin    3150 South Hardin Boulevard    75070    Fairway
Capital Partners, Ltd.    Crestview Real Estate, LLC    (214) 343-4477

315

   Round Rock    TX    Travis    3021 South IH 35, Suite 240    78664    Round
Rock Crossings East LP    Cencor Realty Services    (512) 482-8383

316

   Pittsburgh    PA    Allegheny    8050 McKnight Road, Suite 1-B    15237   
First City North Associates    The First City Company    (412) 391-9260

317

   Cumming    GA    Forsyth    SWC HWY 400 & HWY 20, suite 530B    30040    OTR
   Ben Carter Properties, LLC    (404) 869-2800

318

   La Mirada    CA    Los Angeles    15745 E. Imperial Highway    90638   
Soraya LLC      

320

   Morrisville    NC    Wake    9525 Chapel Hill Road    27560    Cary Park
Place LLC    Kimco Realty Corporation    (919) 791-3650

321

   Concord    NC    Cabarrus    6130 Bayfield Parkway    28027    Afton Ridge
Joint Venture, LLC    Childress Klein Properties    (704) 342-9000

322

   Beachwood    OH    Cuyahoga    23949 Chagrin Boulevard    44122    Pavilion
Properties, LLC       (216) 464-9900

323

   Saint Louis    MO    St. Louis    9610 Manchester Road    63119    Market at
McKnight I, LLC    Novus Companies    (314) 968-0842

324

   Murfreesboro    TN    Rutherford    552 North Thompson Lane    37129    Rama
De Roble, LLc    Parkes Development Group, LLC    (615) 595-2450

325

   Chantilly    VA    Fairfax    13621 Lee Jackson Memorial Highway    20151-
3502    Chantilly Plaza LLC    Combined Properties, Inc.    (202) 293-4500

326

   Franklin Park    NJ    Franklin    3391 State Route 27    08823    The Stop &
Shop Supermarket Company    Fameco Management Services    (781) 440-8356

327

   Keller    TX    Tarrant    1610 Keller Parkway    76248    Tabani Keller II,
LLC    Tabani Group    (972) 417-5835

328

   Las Vegas    NV    Clark    6435 North Decatur Boulevard    89131    Shadow
Mountain Marketplace, LLC    Wynmark Company    (805) 967-6040

329

   Solon    OH    Cuyahoga    33321 Aurora Road    44139    Solon Square LLC   
MIDAMCO    (216) 771-4440

330

   Rochester    NY    Monroe    3349 Monroe Avenue Space 42    14618   
Pittsford Plaza Company, LLC    Wilmorite Management Group, LLC    (585)
424-6220

332

   Tequesta    FL    Palm Beach    105 N. U.S. Highway 1    33469    DDR
Southeast Tequesta, L.L.C.    Developers Diversified Realty Corporation    (954)
845-7160

333

   Holmdel    NJ    Monmouth    Route 35 & Unions Avenue    07733    Holmdel GT
LP & GBR Holmdel Plaza LLC    National Realty & Development Corp.    (914)
694-4444

334

   Noblesville    IN    Hamilton    13920 Hoard Drive    46060    Hamilton Town
Center, LLC    Simon Property Group    (317) 849-9994

335

   Westborough    MA    Wooster    1500 Union Street    01581    Westborough CC,
LLC      

336

   Queen Creek    AZ    Maricopa    21198 South Ellsworth Loop Road    85242   
Vestar QCM, L.L.C.    Vestar Property Management   

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

337

   Port St. Lucie    FL    St. Lucie    NEC of St. Lucie West Blvd & Peacock
Blvd    34986    Benderson Properties, Inc. & Donald Robinson      
(941) 360-7283

338

   Hendersonville    TN    Sumner    1018 Andrews Run    37075    Vastland
Development Partnership    Vastland    (615) 349-0553

339

   Houston    TX    Harris    21115 Tomball Parkway    77070    Lakewood
Houston, LLC    Pacif Star Capital   

340

   Scottsdale    AZ    Maricopa    16227 North Scottsdale Road    85254    Excel
Promenade, LLC    Pacifica Retail Management, LLC    (480) 385-2820

341

   Alpharetta    GA    Fulton    6290 North Point Parkway    30022    CP Venture
Two LLC    Cousins Properties, Inc.    (404) 407-1000

342

   Corpus Christi    TX    Nueces    5425 South Padre Island Drive, Suite 136   
78411    Weingarten Realty Investors      

343

   Hurst    TX    Tarrant    500 Grapevine Highway    76054    Mayfair Station
LLC      

344

   Lenexa    KS    Johnson    9656 Quivira Road    66215    Orchard Center
Company, LLC    Block & Company    (816) 753-6000

345

   Madison    MS    Madison    125 South Congress Street, suite 1800    39201   
Madison Grandview Forum, LLC    Mattiace Properties, Inc.    (601) 352-1818

346

   Sarasota    FL    Sarasota    125 North Cattlemen Road    34243    SIPOC
Associates TIC    Benderson Development Company    (941) 359-8303

347

   Tempe    AZ    Maricopa    1800 E Rio Salado Parkway, Suite 140    85281   
Vestar Tm-OPCO, LLC    Tempe Marketplace    (480) 966-9338

348

   Jacksonville    FL    Duval    1648 University Blvd West    32217    OZ/CLP
Lakewood, LLC    Select Strategies    (321) 558-3860

349

   Monroe    LA    Ouachita
Parish    4700 Millhaven Road, Ste. 1252    71203    Pecanland Mall, LLC   
General Growth Properties, Inc.    (318) 322-4635

350

   Folsom    CA    Sacramento    2725 East Bidwell Street    95630    Folsom
Broadstone, Inc.    CB Richard Ellis    (916) 781-4808

701

   Rolling Hills Estates    CA    Los Angeles    51 B Peninsula Center    90274
   Principal Life Insurance Company    CB Richard Ellis    (310) 541-2242

703

   Hendersonville    NC    Henderson    213 Greenville Highway    28792   
Capitol Funds, Inc.    Faison    (704) 487-8547

704

   Fernandina Beach    FL    Nassau    814 Sadler Road    32034    T.J. of
Nassau, Inc.    Lasserre Real Estate    (904) 261-4066

354

   Denver    CO                  

351

   Flower Mound    TX    Denton    6101 Long Prairie Road, Suite 500    75028   
SFERS Real Estate Corp. MM    UCR Realty    (469) 232-3481

352

   Columbia    SC    Lexington    1120 Bower Parkway    29212    DDRTC
Columbiana Station II LLC    DDR    (843) 767-6765

353

   Hattiesburg    MS    Lamar    1000 Turtle Creek Drive    39402    Turtle
Creek Limited Partnership    CBL & Associates Management, Inc.   

901

   Jacksonville    FL    Duval    8500 Baycenter Road    32256    Eastgroup
Jacksonville, Inc.    Eastgroup Property Services, Inc.    (904) 363-9996

990

   Jacksonville    FL    Duval    1200 Riverplace Boulevard    32207    Parkway
Properties LP    Hallmark Partners    (407) 843-6215

 

The following stores are closed but still have an active lease.

 

131

   Lewisville    TX    Denton    1565 West Main Street, Suite 450    75067    GP
Shopping, LLC    Lamar Companies    (719) 522-1156

159

   Albuquerque    NM    Bernalillo    3731 B Ellison Drive    87114   
Cottonwood Corners Partners, LP    The Woodmont Company    (817) 732-4000

189

   Westminster    CO    Adams    4830 West 120th Avenue    80020    1545 No.
Bronson Co., dba Sheridan Crossing    Westwood Financial Corp.    (480) 314-3300

197

   El Paso    TX    El Paso    11240 Montwood, Space D    79936    F-Star
Development, Inc.    Five Star Development    (915) 860-4500

235

   Layton    UT    Davis    495 West 1425 North    84041    Layton Hills Mall
CMBS, LLC    CBL & Associates Management, Inc.    (801) 546-3741

259

   Littleton    CO    Denver    8601 W. Cross Dr., Suite L    80123    Southwest
Commons 05 A, LLC, Southwest Commons 05 B, LLC, Southwest Commons 05 C, LLC,
Southwest Commons 05 D, LLC, Southwest Commons 05 E, LLC, Southwest Commons 05
F, LLC, and Southwest Commons 05 G, LLC    ACF Property Management, Inc    (818)
505-6777

282

   Centerville    OH    Montgomery    985 South Main Street    45458    Huber
Management Corporation    Huber Management Corporation    (937) 291-2791

702

   Pasadena    CA    Los Angeles    345 South Lake Avenue #112    91101    Shops
At Lake LLC    Vornado Realty Trust    (201) 587-1000

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

Schedule 5.09

ENVIRONMENTAL MATTERS

None.

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

Schedule 5.10

INSURANCE

 

Coverage

  

Carrier

Property (includes business interruption, windstorm, flood and earthquake)

   American Guarantee and Liability Ins. Co.

Ocean Cargo

   Federal Insurance Company

Directors & Officers - $10mm

   Travelers Casualty & Surety Co. of America

- $10mm excess of $10mm

   Axis Insurance Company

- $10mm excess of $20mm

   Continental Casualty Company

- $10mm excess of $30mm (Broad Form Side A)

   Federal Insurance Company

Fiduciary Liability & Crime

   Travelers Casualty & Surety Co. of America

Special Crime

   National Union Fire of PA

Workers’ Compensation

   Travelers Property Casualty/Travelers Indemnity Company

General Liability

   Travelers Property Casualty Company of America

Automobile

   Travelers Property Casualty Company of America

Foreign Liability

   Vigilant Insurance Co.

Umbrella - $25mm

   Continental Casualty Company

- $25mm excess of $25mm

   St. Paul Fire & Marine

- $25mm excess of $50mm

   National Surety Corporation

- $25mm excess of $75mm

   Great American Ins. Co.

Employment Practices Liability

   Continental Casualty Company

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

Schedule 5.13

SUBSIDIARIES; OTHER EQUITY INVESTMENTS

 

(a)

 

          Jurisdiction of    Authorized    Ownership

Loan Party

  

Subsidiary

  

Incorporation

  

Equity Interests

  

Percentage

Stein Mart, Inc.

   Stein Mart Buying Corp.    Florida    1,000 shares    Stein Mart, Inc. – 100%
   Stein Mart Holding Corp.    Florida    1,000 shares    Stein Mart, Inc. –
100%

 

(b)

See part (a) above.

 

(c)

 

Loan Party

  

Ownership

Stein Mart, Inc.*

  

Jay Stein – 35.5%

Others – 64.5%

Stein Mart Buying Corp.

   Stein Mart, Inc. – 100%

Stein Mart Holding Corp.

   Stein Mart, Inc. – 100%

 

* - as of 4/1/11 (beneficial ownership date for most recent annual meeting of
shareholders)

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

Schedule 5.17

INTELLECTUAL PROPERTY MATTERS

None.

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

Schedule 5.18

LABOR MATTERS

Employment Agreements relating to four executive officers plus one senior
General Merchandise Manager

Short-Term Incentive Plan

Long-Term Incentive Plan

Stein Mart, Inc. 2001 Omnibus Plan as amended and restated effective June 14,
2011

Deferred Compensation Plan

Split-Dollar Life Insurance Plan

Employee Stock Purchase Plan

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

Schedule 5.21(a)

DDAs

 

Store #

  

State

  

City

  

Bank

  

Branch Address

  

Contact Person

  

Blocked Account
Bank

3

   TN    Brentwood    Bank of America N.A.    330 S. Franklin Rd Brentwood, TN
37027   

Patrick Soloman

404-607-5106

   Wells Fargo

5

   AR    Little Rock    Bank of America N.A.    6823 Cantrell Rd Little Rock, AR
72207    Same as above    Wells Fargo

14

   OK    Tulsa    Bank of America N.A.    5101 S Lewis Avenue, Tulsa, OK 74105
   Same as above    Wells Fargo

30

   MO    Kansas City    Bank of America N.A.    8440 West 135th Street, Overland
Park, KS 66223    Same as above    Wells Fargo

44

   OK    Oklahoma City    Bank of America N.A.    4916 N. May Ave Oklahoma, City
OK 73112    Same as above    Wells Fargo

63

   TN    Nashville    Bank of America N.A.    92 White Bridge Rd Nashville, TN
37205    Same as above    Wells Fargo

65

   TX    Fort Worth    Bank of America N.A.    6300 Ridglea Place, Fort Worth,
TX 76116    Same as above    Wells Fargo

68

   TX    Amarillo    Bank of America N.A.    3440 Bell St., Suite 328, Amarillo,
TX 79109    Same as above    Wells Fargo

72

   TX    Arlington    Bank of America N.A.    2102 N. Collins Rd, Arlington, TX
76011    Same as above    Wells Fargo

78

   TX    Dallas    Bank of America N.A.    14902 Preston Rd Dallas, TX 75240   
Same as above    Wells Fargo

79

   TX    Austin    Bank of America N.A.    3201 Bee Caves Rd, Ste 140, Austin,
TX 75240    Same as above    Wells Fargo

82

   TX    Tyler    Bank of America N.A.    3301 Golden Rd., Tyler, TX 75701   
Same as above    Wells Fargo

84

   TX    Houston    Bank of America N.A.    290 Meyerland Plaza, Houston TX
77096    Same as above    Wells Fargo

96

   NC    Ashville    Bank of America N.A.    892 Merrimon Ave, Asheville, NC
28804    Same as above    Wells Fargo

98

   TX    Kingwood    Bank of America N.A.    1153 Kingwood Dr. Kingwood, Tx
77339    Same as above    Wells Fargo

112

   TX    Irving    Bank of America N.A.    7300 N. MacArthur Blvd, Suite A,
Irving, TX 75063    Same as above    Wells Fargo

117

   TX    Stafford    Bank of America N.A.    11739 W Bellfort St., Stafford, TX
77477    Same as above    Wells Fargo

118

   AR    N. Little Rock    Bank of America N.A.    2727 Lakewood Village Dr.
North Little Rock, AR 72116    Same as above    Wells Fargo

123

   TX    Dallas    Bank of America N.A.    6300 East Mockingbird Lane, Dallas,
TX 75214    Same as above    Wells Fargo

124

   TX    Katy    Bank of America N.A.    1747 Fry Rd, Katy, TX 77449    Same as
above    Wells Fargo

126

   TX    Midland    Bank of America N.A.    4309 N Garfield St., Midland, TX
79705    Same as above    Wells Fargo

131

   TX    Lewisville    Bank of America N.A.    825 Cross Timbers, Flower Mound,
TX 75028    Same as above    Wells Fargo

140

   TX    Rockwall    Bank of America N.A.    2855 Ridge Rd, Rockwall, TX 75032
   Same as above    Wells Fargo

146

   MO    N. Kansas City    Bank of America N.A.    8331 N.W. Roanridge Rd, Kansa
City, MO 64154    Same as above    Wells Fargo

154

   CA    Poway    Bank of America N.A.    12724 Poway Road, Poway, CA 92064   
Same as above    Wells Fargo

155

   NY    Williamsville    Bank of America N.A.    7864 Transit Rd.,
Williamsville, NY 14221    Same as above    Wells Fargo

167

   NC    Cornelius    Bank of America N.A.    20005 Hwy 73 W, Cornelius, NC
28031    Same as above    Wells Fargo

181

   OK    Edmond    Bank of America N.A.    3480 S. Boulevard, Edmond, OK 73013
   Same as above    Wells Fargo

182

   IL    Wheaton    Bank of America N.A.    18 Blanchard Circle, Wheaton, IL
60187    Same as above    Wells Fargo

199

   CA    Stevenson Ranch    Bank of America N.A.    26960 The Old Road,
Stevenson Rach, CA 91381    Same as above    Wells Fargo

201

   TN    Chattanooga    Bank of America N.A.    2020 Gunbarrel Rd # 300,
Chattanooga, TN 37421    Same as above    Wells Fargo

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

205

   GA    Macon    Bank of America N.A.    4040 Vineville Ave., Macon, GA 31210
   Same as above    Wells Fargo

208

   OK    Tulsa    Bank of America N.A.    9242 S Yale, Tulsa, OK 74132    Same
as above    Wells Fargo

220

   CA    Temecula    Bank of America N.A.    31934 Highway 79 South, Temecula,
CA 92592    Same as above    Wells Fargo

239

   SC    Murrells Inlet    Bank of America N.A.    1201 Hwy 17, Murrells Inlet,
SC 29576    Same as above    Wells Fargo

240

   FL    Melbourne    Bank of America N.A.    2453 N Wickham Rd., Melbourne, FL
32935    Same as above    Wells Fargo

243

   FL    Cooper City    Bank of America N.A.    5504 S Flamingo Rd., Cooper
City, FL 33330    Same as above    Wells Fargo

252

   MO    Ballwin    Bank of America N.A.    15115 Manchester Rd., Ballwin, MO
63011    Same as above    Wells Fargo

280

   GA    Albany    Bank of America N.A.    2707 Dawson Rd, Albany, GA 31707   
Same as above    Wells Fargo

281

   FL    Valrico    Bank of America N.A.    3456 Litha-Pinecrest Rd, Valrico, Fl
33594    Same as above    Wells Fargo

288

   FL    Jacksonville    Bank of America N.A.    10925 Baymeadows Road,
Jacksonville, FL 32256    Same as above    Wells Fargo

310

   FL    Royal Palm Beach    Bank of America N.A.    131 South State Rd 7,
Wellington, Fl 33414    Same as above    Wells Fargo

314

   TX    McKinney    Bank of America N.A.    3500 W. Eldorado Parkway, McKinney,
TX 75070    Same as above    Wells Fargo

321

   NC    Concord    Bank of America N.A.    368 George W. Liles Parkway NW,
Concord NC 28027    Same as above    Wells Fargo

323

   MO    St. Louis    Bank of America N.A.    9961 Rochester Rd, St Louis, MS
63122    Same as above    Wells Fargo

327

   TX    Keller    Bank of America N.A.    1440 Keller Parkway, Keller, Tx.
76248    Same as above    Wells Fargo

328

   NV    Las Vegas    Bank of America N.A.    6435 N. Decatur Blvd. Las Vegas,
NV 89131    Same as above    Wells Fargo

330

   NY    Rochester    Bank of America N.A.    2830 Monroe Ave, Rochester, NY
14618    Same as above    Wells Fargo

335

   MA    Westborough    Bank of America N.A.    35 Lyman St, Westborough, MA
01581    Same as above    Wells Fargo

340

   AZ    Scottsdale    Bank of America N.A.    16431 N Scottsdale Rd.
Scottsdale, AZ 85254    Same as above    Wells Fargo

344

   KS    Lenexa    Bank of America N.A.    12345 W 95th St., Lenexa, KS 66215   
Same as above    Wells Fargo

13

   LA    Baton Rouge    Capital One    8009 Jefferson Hwy., Baton Rouge, LA
70809   

Jacob Vilere

504-533-3279

   Wells Fargo

22

   LA    New Orleans    Capital One    313 Carondelet, New Orleans, LA 70130   
Same as above    Wells Fargo

40

   LA    Metairie    Capital One    2201 Veterans Memorial Blvd., Metairie, LA
70002    Same as above    Wells Fargo

90

   LA    Lafayette    Capital One    4416 Ambassador Caffrey, Lafayette, LA
70508    Same as above    Wells Fargo

192

   LA    Mandeville    Capital One    3840 Emerald Road, Hwy 22, Mandeville, LA
70471    Same as above    Wells Fargo

232

   LA    Kenner    Capital One    1000 W. Esplanade, Kenner, LA 70065    Same as
above    Wells Fargo

104

   CO    Englewood    Compass Bank    8100 E Araphoe Rd., Englewood, CO 80112   

Sandy Starks

904-564-8867

   Wells Fargo

132

   TX    San Antonio    Compass Bank    18080 US Hwy 281 N, San Antonio, TX
78232    Same as above    Wells Fargo

161

   TX    Laredo    Compass Bank    5810 San Bernardo, Laredo, TX 78041    Same
as above    Wells Fargo

206

   TX    Arlington    Compass Bank    5980 South Cooper St. Arlington, TX 76017
   Same as above    Wells Fargo

207

   AL    Tuscaloosa    Compass Bank    2350 McFarland Blvd., E., Tuscaloosa, AL
35404    Same as above    Wells Fargo

217

   TX    College Station    Compass Bank    2405 Texas Ave. S., College Station,
TX 77845    Same as above    Wells Fargo

4

   KY    Louisville    Fifth Third Bank    4090 Shelbyville Rd, Louisville, KY
40207   

John Marian

813-306-2456

   Wells Fargo

12

   KY    Lexington    Fifth Third Bank    3100 Richmond Rd, Lexington, KY 40509
   Same as above    Wells Fargo

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

60

   OH    Kettering    Fifth Third Bank    416 East Stroop Rd., Dayton, OH 45429
   Same as above    Wells Fargo

62

   OH    Cincinnati    Fifth Third Bank    2632 Erie, Cincinnati, OH 45208   

Sandy Starks

904-564-8867

   Wells Fargo

71

   IN    Indianapolis    Fifth Third Bank    1851 West 86th St., Indianapolis,
IN 46268    Same as above    Wells Fargo

74

   OH    Cincinnati    Fifth Third Bank    10869 Montgomery Road, Cincinnati, OH
45242    Same as above    Wells Fargo

130

   OH    Columbus    Fifth Third Bank    3628 W Dublin-Grandville Rd., Columbus,
OH 43235    Same as above    Wells Fargo

135

   IN    Evansville    Fifth Third Bank    661 S. Green River Rd., Evansville,
IN 47715    Same as above    Wells Fargo

186

   OH    Westlake    Fifth Third Bank    25251 Detroit Rd., Westlake, OH 44145
   Same as above    Wells Fargo

219

   IL    Orland Park    Fifth Third Bank    10759 W. 159th St., Orland Park, IL
60467   

John Marian

813-306-2456

   Wells Fargo

224

   IL    St. Charles    Fifth Third Bank    1600 E. Main St., St. Charles, IL
60174    Same as above    Wells Fargo

275

   IN    Greenwood    Fifth Third Bank    106 North State Road 135, Greenwood,
Indiana 46142    Same as above    Wells Fargo

302

   IL    Kildeer    Fifth Third Bank    660 South Rand Road, Lake Zurich, IL
60047    Same as above    Wells Fargo

307

   IL    Deerfield    Fifth Third Bank    2775 Dundee St, Northbrook, Il 60062
   Same as above    Wells Fargo

329

   OH    Solon    Fifth Third Bank    6445 Som Center Rd, Solon, OH 44139   
Same as above    Wells Fargo

334

   IN    Noblesville    Fifth Third Bank    16864 Clover Rd, Noblesville, IN
46060    Same as above    Wells Fargo

28

   SC    Greenville    First Citizens Bank    2420 Laurens Rd, Greenville, SC
29607   

David Borden

803-733-2067

   Wells Fargo

87

   IN    Terre Haute    First Financial Bank    350 S. 25th St., Terre Haute, IN
47803   

Jeff Redman

812-238-6291

   Wells Fargo

269

   NY    Orchard Park    HSBC Bank    3049 Orchard Park Rd., Orchard Park, NY
14127   

Patrick Gorman

716-674-9511

   Wells Fargo

134

   OH    Toledo    Huntington National Bank    3316 Secor Road, Toledo, OH 43606
  

Jason Travis

216-515-6141

   Wells Fargo

250

   MI    Portage    Huntington National Bank    7127 S. Westnedge St., Portage,
MI 49024    Same as above    Wells Fargo

271

   OH    Columbus    Huntington National Bank    1301 North Hamilton Road,
Gahanna, Ohio 43230    Same as above    Wells Fargo

316

   PA    Pittsburgh    Huntington National Bank    8090 McKnight Rd, Pittsburgh,
PA 15237    Same as above    Wells Fargo

322

   OH    Beachwood    Huntington National Bank    24615 Chagrin Rd, Beachwood,
OH 44122    Same as above    Wells Fargo

55

   TX    McAllen    International Bank    1700 South 10th St, McAllen, TX 78506
  

Robby Himel

956-664-8400

   Wells Fargo

136

   WI    Brookfield    M&I Bank    16570 W Bluemound., Brookfield, WI 53005   

Karen Fricke

262-797-4400

   Wells Fargo

297

   IN    Carmel    PNC Bank    2410 East 146th Street, Loc-60-383, Carmel, IN
46033   

Robert Bartley

317-846-4043

   Wells Fargo

10

   TN    Knoxville    Regions Bank    7821 Kingston Pike, Knoxville, TN 37919   

Louis Constanzo

904-998-4971

   Wells Fargo

32

   TN    Memphis    Regions Bank    4894 Poplar Avenue, Memphis, TN 38117   
Same as above    Wells Fargo

41

   AL    Huntsville    Regions Bank    4769 Whitesburg Dr., Huntsville, AL 35802
   Same as above    Wells Fargo

46

   LA    Shreveport    Regions Bank    4740 Line Ave., Shreveport, LA 71106   
Same as above    Wells Fargo

89

   MS    Hattiesburg    Regions Bank    908 Broadway Drive, Hattiesburg, MS
39401    Same as above    Wells Fargo

127

   TN    Johnson City    Regions Bank    208 Sunset Dr., Johnson City, TN 37604
   Same as above    Wells Fargo

183

   TN    Farragut    Regions Bank    11513 Kingston Pike, Knoxville, TN 37922   
Same as above    Wells Fargo

267

   FL    Tampa Palms    Regions Bank    15351 Amberly Dr, Tampa, Fl 33647   
Same as above    Wells Fargo

272

   TN    Jackson    Regions Bank    5 Channing Way Dr., Jackson, TN 38305   
Same as above    Wells Fargo

303

   AL    Montgomery    Regions Bank    2170 Taylor Rd, Montgomery, AL 36117   
Same as above    Wells Fargo

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

324

   TN    Murfreesboro    Regions Bank    424 N. Thompson Lane, Murfreesboro, Tn
37129    Same as above    Wells Fargo

338

   TN    Hendersonville    Regions Bank    1042 Glenbrook Way, Hendersonville,
TN 37075    Same as above    Wells Fargo

349

   LA    Monroe    Regions Bank    1001 N. 18th Street, Monroe, LA 71201    Same
as above    Wells Fargo

1

   MS    Greenville    TrustMark National Bank    1637 Hwy 1 South, Greenville,
MS 38701   

Lynn Durrett

662-334-8480

   Wells Fargo

6

   MS    Jackson    TrustMark National Bank    1440 Canton Mark Rd., Jackson, MS
39211   

Brenda Cox

601-354-5949

   Wells Fargo

295

   MS    Flowood    TrustMark National Bank    101 Laural Park Dr, Flowood, MS
39232   

Vicki Lyle

601-939-7300

   Wells Fargo

345

   MS    Madison    TrustMark National Bank    1051 Highway 51, Madison, MS
39110   

Marvin Freeman

601-856-6522

   Wells Fargo

7

   AL    Mobile    Wells Fargo Bank    4650 Airport Blvd., Mobile, Al 36608   

Charles Kaufman

904-489-3662

   Wells Fargo

11

   FL    Altamonte Springs    Wells Fargo Bank    1031 Montgomery Road,
Altamonte Springs, FL 32714    Same as above    Wells Fargo

16

   FL    Jacksonville    Wells Fargo Bank    4206 San Juan Avenue, Jacksonville,
FL 32210    Same as above    Wells Fargo

18

   AL    Birmingham    Wells Fargo Bank    641 Montgomery Highway, Vestavia, Fl
35216-1809    Same as above    Wells Fargo

19

   VA    Richmond    Wells Fargo Bank    7101 West Broad St, Richmond VA
23294-3703    Same as above    Wells Fargo

23

   TX    San Antonio    Wells Fargo Bank    4524 Fredericksburg Rd, San Antonia
TX 78201-6501    Same as above    Wells Fargo

24

   TX    San Antonio    Wells Fargo Bank    999 Basse St, San Antonio, TX
78209-1214    Same as above    Wells Fargo

25

   FL    Tallahassee    Wells Fargo Bank    3529 Thomasville, Tallahassee, FL
32312    Same as above    Wells Fargo

26

   NC    Raleigh    Wells Fargo Bank    6002 Falls of te Neuse Road, Raleigh, NC
27609    Same as above    Wells Fargo

27

   TX    Austin    Wells Fargo Bank    8045 Mesa Dr , Austin, TX 78731    Same
as above    Wells Fargo

31

   FL    Tampa    Wells Fargo Bank    4203 Gandy Blvd, Tampa, FL 33611    Same
as above    Wells Fargo

33

   FL    Pensacola    Wells Fargo Bank    4441 Bayou Blvd, Pensacola, FL 32503
   Same as above    Wells Fargo

36

   NC    Greensboro    Wells Fargo Bank    3705 Battleground Avenue, Greensboro,
NC 27410    Same as above    Wells Fargo

37

   FL    Jacksonville    Wells Fargo Bank    10600 San Jose Blvd, Jacksonville,
FL 32257    Same as above    Wells Fargo

38

   VA    Richmond    Wells Fargo Bank    10831 Midlothian Turnpike, Midlothian,
VA 23235    Same as above    Wells Fargo

42

   NC    Cary    Wells Fargo Bank    1201 Walnut Street, Cary, NC 27511    Same
as above    Wells Fargo

43

   SC    Charleston    Wells Fargo Bank    828 Orleans Rd, Charleston, SC 29407
   Same as above    Wells Fargo

45

   FL    Jax Beach    Wells Fargo Bank    3740 S 3rd St, Jacksonville Bch, FL
32250    Same as above    Wells Fargo

47

   NC    Winston-Salem    Wells Fargo Bank    418 S Stratford Road,
Winston-Salem, NC 27103    Same as above    Wells Fargo

48

   NC    Pineville    Wells Fargo Bank    9420 Pineville-Matthews Rd.,
Pineville, NC 28134    Same as above    Wells Fargo

49

   VA    Virginia Beach    Wells Fargo Bank    125 Independence Blvd, Virginia
Beach, VA 23462    Same as above    Wells Fargo

50

   TX    Lubbock    Wells Fargo Bank    4905 82nd St., Lubbock, TX 79424    Same
as above    Wells Fargo

51

   FL    Boca Raton    Wells Fargo Bank    9906 Glades Rd, Bocs Raton, FL 33434
   Same as above    Wells Fargo

52

   FL    Palm Harbor    Wells Fargo Bank    33277 US HWY 19 North, Palm Harbor,
FlL 34684    Same as above    Wells Fargo

53

   GA    Augusta    Wells Fargo Bank    2835 Washington Road, Augusta, GA 30909
   Same as above    Wells Fargo

56

   TX    Houston    Wells Fargo Bank    8607 Westheimer Rd, Houston, TX
77063-4201    Same as above    Wells Fargo

57

   FL    Fort Myers    Wells Fargo Bank    12751 S. Cleveland, Ft. Myers, FL
33907    Same as above    Wells Fargo

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

58

   FL    Tampa    Wells Fargo Bank    13003 N. Dale Mabry, Tampa, FL 33618   
Same as above    Wells Fargo

66

   TX    Webster    Wells Fargo Bank    1005 Bay Area Blvd, Houston, TX
77058-2605    Same as above    Wells Fargo

67

   AL    Birmingham    Wells Fargo Bank    5376 HWY 280, Birmingham, AL
35242-5389    Same as above    Wells Fargo

70

   TX    Houston    Wells Fargo Bank    5302 FM 1960 Rd West. Houston, TX
77069-4404    Same as above    Wells Fargo

73

   GA    Marietta    Wells Fargo Bank    1329 Johnson Ferry Road, GA 9131,
Marietta, GA 30068    Same as above    Wells Fargo

75

   NC    Raleigh    Wells Fargo Bank    7600 Creedmoor Road, Raleigh, NC 27613
   Same as above    Wells Fargo

76

   FL    Sarasota    Wells Fargo Bank    4794 S Tamiami Trail, Sarasota, FL
34231    Same as above    Wells Fargo

80

   AZ    Scottsdale    Wells Fargo Bank    10725 N Scottsadle Rd, Scottsdale AZ
85254-5264    Same as above    Wells Fargo

81

   GA    Columbus    Wells Fargo Bank    1607 Bradley Park Dr, Columbus GA,
31904-3072    Same as above    Wells Fargo

85

   AZ    Tucson    Wells Fargo Bank    6350 Oracle Rd, Tucson AZ, 85704-5483   
Same as above    Wells Fargo

91

   TX    Plano    Wells Fargo Bank    4975 Preston Park Blvd., Suite 100, Plano,
TX 75093    Same as above    Wells Fargo

92

   GA    Dunwoody    Wells Fargo Bank    1630 Mount Vernon Road, GA 9156,
Dunwoody, GA 30338    Same as above    Wells Fargo

93

   AZ    Gilbert    Wells Fargo Bank    1495 E. Warner St., Gilbert, AZ 85296   
Same as above    Wells Fargo

94

   VA    Roanoke    Wells Fargo Bank    4206 Electric Road SW, Roanoke, VA 24014
   Same as above    Wells Fargo

97

   NC    Mathews    Wells Fargo Bank    1401 Matthews-Mint Hill Road, Matthews,
NC 28105    Same as above    Wells Fargo

100

   GA    Savannah    Wells Fargo Bank    330 Mall Blvd., Savannah, GA 31406   
Same as above    Wells Fargo

102

   GA    Peachtree City    Wells Fargo Bank    703 Crossings West, Peachtree
City, GA 30269    Same as above    Wells Fargo

103

   NC    Fayetteville    Wells Fargo Bank    1440 Walter Reed Road,
Fayetteville, NC 28304    Same as above    Wells Fargo

105

   IN    Fort Wayne    Wells Fargo Bank    6324 Covington Plaza, Ft. Wayne, IN
46804    Same as above    Wells Fargo

107

   MS    Biloxi    Wells Fargo Bank    2675 Pass Rd., Biloxi, MS 39531    Same
as above    Wells Fargo

108

   FL    Lakeland    Wells Fargo Bank    4405 S. Florida Ave., Lakeland, FL
33813    Same as above    Wells Fargo

113

   CO    Colorado Springs    Wells Fargo Bank    8620 N. Union Blvd., Colorado
Springs, CO 80920    Same as above    Wells Fargo

116

   PA    Allentown    Wells Fargo Bank    3055 Emaus Ave., Allentown, PA 18103
   Same as above    Wells Fargo

119

   FL    Orlando    Wells Fargo Bank    2434 E. Colonial, Orlando, FL 32803   
Same as above    Wells Fargo

120

   VA    Chesapeak    Wells Fargo Bank    1208 Greenbrier Pkwy, Chesapeake, VA
23320    Same as above    Wells Fargo

121

   AZ    Glendale    Wells Fargo Bank    6695 W. Bell Rd., Glendale, AZ 85308   
Same as above    Wells Fargo

122

   TX    Beaumont    Wells Fargo Bank    4405 Dowlen Rd., Beaumont, Tx 77706   
Same as above    Wells Fargo

125

   FL    Naples    Wells Fargo Bank    11075 Tamiami Trail N, Naples FL,
34108-1903    Same as above    Wells Fargo

137

   GA    Athens    Wells Fargo Bank    290 Alps Rd, Atthens GA, 30606-4058   
Same as above    Wells Fargo

139

   FL    Gainesville    Wells Fargo Bank    6301 Newberry Rd. #F10311,
Gainesville, FL 32605    Same as above    Wells Fargo

141

   GA    Marietta    Wells Fargo Bank    2850 Canton Road, NE, Marietta, GA
30066    Same as above    Wells Fargo

143

   NV    Henderson    Wells Fargo Bank    611 N Stephanie St, Henderson NV,
89014    Same as above    Wells Fargo

148

   NV    Reno    Wells Fargo Bank    4879 Kietzke Ln, Reno NV, 89509    Same as
above    Wells Fargo

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

149

   TN    Memphis    Wells Fargo Bank    1365 N German Town Parkway, Cordova TN,
38016-5959    Same as above    Wells Fargo

153

   FL    Coral Springs    Wells Fargo Bank    3300 University Drive, Magnolia
Shops, Coral Springs Fl 33067    Same as above    Wells Fargo

158

   FL    Seminole    Wells Fargo Bank    7700 Seminole Blvd, Seminole, FL 33772
   Same as above    Wells Fargo

160

   FL    Pompano Beach    Wells Fargo Bank    6245 N. Federal Hwy., Ft.
Lauderdale, FL 33334    Same as above    Wells Fargo

173

   CA    Mission Veijo    Wells Fargo Bank    27702 Crown Valley Parkway, Ladera
Ranch, CA 92694    Same as above    Wells Fargo

174

   GA    Snellville    Wells Fargo Bank    1590 Scenic Hwy, Snellville, GA 30078
   Same as above    Wells Fargo

175

   SC    Columbia    Wells Fargo Bank    4408 Forest Dr, Columbia SC, 29206-3135
   Same as above    Wells Fargo

177

   TX    Austin    Wells Fargo Bank    10900 Lakeline Mall Dr Bldg K, Austin TX,
78717-5933    Same as above    Wells Fargo

180

   FL    Orlando    Wells Fargo Bank    7740 Sand Lake Rd., Orlando, FL 32819   
Same as above    Wells Fargo

184

   VA    Virginia Beach    Wells Fargo Bank    1608 Laskin Rd, Virginia Bch VA,
23451    Same as above    Wells Fargo

185

   FL    Venice    Wells Fargo Bank    1301 US 41 By-Pass, Venice, FL 34293   
Same as above    Wells Fargo

187

   NV    Las Vegas    Wells Fargo Bank    8190 W Sahara Ave., Las Vegas, NV
89117    Same as above    Wells Fargo

188

   SC    Myrtle Beach    Wells Fargo Bank    7102 N Kings Hwy, Myrtle Bch SC,
29572-3025    Same as above    Wells Fargo

190

   SC    Florence    Wells Fargo Bank    104 David McCleod Blvd., Florence, SC
29501    Same as above    Wells Fargo

193

   TX    Houston    Wells Fargo Bank    6990 Highway 6 N., Houston, TX 77084   
Same as above    Wells Fargo

194

   FL    St. Petersburg    Wells Fargo Bank    3637 Fourth St N, St Petersburg
FL, 33704-1365    Same as above    Wells Fargo

198

   CA    Rancho Cucamonga    Wells Fargo Bank    10540 Foothill Blvd., Rancho
Cucamonga, CA 91730    Same as above    Wells Fargo

202

   NC    High Point    Wells Fargo Bank    2613 NC68 South, High Point, NC 27265
   Same as above    Wells Fargo

203

   SC    Spartanburg    Wells Fargo Bank    1956 E Main St, Spartanburg SC,
29307-2305    Same as above    Wells Fargo

204

   FL    Plantation    Wells Fargo Bank    1790 N. Pine Island Rd., Plantation,
FL 33323    Same as above    Wells Fargo

210

   CA    Fullerton    Wells Fargo Bank    111 E. Yorba Linda Blvd., Placentia CA
92870    Same as above    Wells Fargo

212

   SC    Hilton Head Island    Wells Fargo Bank    75 Mathews Drive, Hilton
Head, SC 29926    Same as above    Wells Fargo

213

   NC    Hickory    Wells Fargo Bank    1453 2nd Street, NE, Hickory, NC 28601
   Same as above    Wells Fargo

214

   CA    Fresno    Wells Fargo Bank    2508 W. Shaw Ave., Fresno, CA 93711   
Same as above    Wells Fargo

215

   FL    Destin    Wells Fargo Bank    34877 Emerald Coast PKWY, Destin FL,
32541-3438    Same as above    Wells Fargo

221

   SC    Lexington    Wells Fargo Bank    5490 Sunset Blvd., Lexington, SC 29072
   Same as above    Wells Fargo

222

   TX    Shenandoah    Wells Fargo Bank    9595 Six Pines Dr, Woodland, TX 77380
   Same as above    Wells Fargo

223

   FL    Daytona Beach    Wells Fargo Bank    1302 W. International Speedway
Blvd, Daytona Beach, FL 32114    Same as above    Wells Fargo

226

   NC    Greenville    Wells Fargo Bank    820 Red Banks Rd, Greenville NC,
27858    Same as above    Wells Fargo

229

   CA    Palm Springs    Wells Fargo Bank    543 S. Palm Canyon Dr., Palm
Springs, CA 92264    Same as above    Wells Fargo

230

   FL    Stuart    Wells Fargo Bank    3181 SE Federal HWY, Stuart FL, 34994   
Same as above    Wells Fargo

233

   TX    Frisco    Wells Fargo Bank    3080 Preston Rd, Frisco TX, 75034-9941   
Same as above    Wells Fargo

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

234

   UT    Salt Lake City    Wells Fargo Bank    1290 S. Foothill Drive, Salt Lake
City, UT 84108    Same as above    Wells Fargo

236

   TN    Franklin    Wells Fargo Bank    210 South Royal Oaks Blvd, Franklin TN,
37064-5313    Same as above    Wells Fargo

237

   TX    El Paso    Wells Fargo Bank    6960 N. Mesa St., El Paso, TX 79912   
Same as above    Wells Fargo

238

   TN    Collierville    Wells Fargo Bank    9301 Poplar Ave, Germantown, TN
38138    Same as above    Wells Fargo

245

   CA    Chino Hills    Wells Fargo Bank    3289 Grand Ave., Chino Hills, CA
91709    Same as above    Wells Fargo

246

   CA    Huntington Beach    Wells Fargo Bank    19840 Beach Blvd., Huntington
Beach, CA 92648    Same as above    Wells Fargo

247

   NC    Wilmington    Wells Fargo Bank    3750 Oleander Dr., Wilmington, NC
28403    Same as above    Wells Fargo

248

   CA    La Verne    Wells Fargo Bank    1487 Foothill Blvd., LaVerne, CA 91750
   Same as above    Wells Fargo

249

   AL    Huntsville    Wells Fargo Bank    6244 University Dr NW, Huntsville Al,
35806-1706    Same as above    Wells Fargo

251

   CA    Yorba Linda    Wells Fargo Bank    20375 Yorba Linda Blvd., Yorba
Linda, CA 92886    Same as above    Wells Fargo

253

   AL    Daphne    Wells Fargo Bank    28520 US HWY 98, Daphne AL, 36526-7066   
Same as above    Wells Fargo

255

   VA    Midlothian    Wells Fargo Bank    13200 Hull Street Road, Midlothian,
VA 23112    Same as above    Wells Fargo

261

   TX    San Antonio    Wells Fargo Bank    13703 W IH 10, San Antonio TX,
78249-2250    Same as above    Wells Fargo

262

   FL    Bonita Springs    Wells Fargo Bank    26791 S Tamiami Trail, Bonita
Springs, 34134    Same as above    Wells Fargo

265

   VA    Leesburgs    Wells Fargo Bank    701-A West Market ST, Leesburg VA,
20176-4402    Same as above    Wells Fargo

266

   SC    Mt. Pleasant    Wells Fargo Bank    648 Long Point Road, Mt. Pleasant,
SC 29464    Same as above    Wells Fargo

268

   FL    Ocala    Wells Fargo Bank    3201 SW College Rd, Ocala FL, 34474   
Same as above    Wells Fargo

270

   CA    Riverside    Wells Fargo Bank    483 E. Alessandro Blvd, Riverside, CA
92508    Same as above    Wells Fargo

273

   CA    Granada Hills    Wells Fargo Bank    10225 Balboa Blvd., Northridge, CA
91325    Same as above    Wells Fargo

274

   CA    Irvine    Wells Fargo Bank    4505 Barranca Blvd Suite C, Irvine CA,
92604    Same as above    Wells Fargo

276

   TX    Fort Worth    Wells Fargo Bank    6000 Harris Pkwy, Fort Worth TX,
76132-4102    Same as above    Wells Fargo

277

   AL    Hoover    Wells Fargo Bank    2527 John Hawkins Parkway, Hoover, AL
35244    Same as above    Wells Fargo

278

   VA    Williamsburg    Wells Fargo Bank    1006 Richmond Rd, Williamsburg VA,
23185-2824    Same as above    Wells Fargo

279

   VA    Richmond    Wells Fargo Bank    3300 Pump Rd, Richmond VA, 23233-1117
   Same as above    Wells Fargo

283

   NC    Charlotte    Wells Fargo Bank    10630 Providence Rd., Charlotte, NC
28277    Same as above    Wells Fargo

284

   FL    Clearwater    Wells Fargo Bank    2580 N McMullen Booth Rd.,
Clearwater, FL 33761    Same as above    Wells Fargo

286

   FL    N. Palm Beach Gardens    Wells Fargo Bank    11710 US Hwy 1, Palm Beach
Gardens, FL 33408    Same as above    Wells Fargo

289

   FL    Vero Beach    Wells Fargo Bank    1780 US Highway 1, Vero Beach, FL
32960    Same as above    Wells Fargo

290

   NC    Chapel Hill    Wells Fargo Bank    129 South Estes Drive, Chapel Hill,
NC 27514    Same as above    Wells Fargo

291

   NJ    Cherry Hill    Wells Fargo Bank    399 Marlton Pike E, Cherry Hill NJ,
08034    Same as above    Wells Fargo

293

   PA    Downingtown    Wells Fargo Bank    100 W. Lkincoln Hwy, Exton, PA 19341
   Same as above    Wells Fargo

294

   CA    La Quinta    Wells Fargo Bank    77952 Country Club Drive, Palm Desert,
CA 92211    Same as above    Wells Fargo

296

   PA    Jenkintown    Wells Fargo Bank    1101 Old York Road, Abington, PA
19001    Same as above    Wells Fargo

298

   FL    Casselberry    Wells Fargo Bank    1391 State Road 436, Casselberry, FL
32707    Same as above    Wells Fargo

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

299

   NJ    Ocean    Wells Fargo Bank    1011 Highway 35, Ocean, NJ 07712    Same
as above    Wells Fargo

301

   FL    Boynton Beach    Wells Fargo Bank    1550 W Boynton Bch Blvd, Boynton
Bch FL, 33426    Same as above    Wells Fargo

304

   AZ    Chandler    Wells Fargo Bank    1100 W QUEEN CREEK RD, Chandler, AZ
85248    Same as above    Wells Fargo

309

   FL    Jacksonville    Wells Fargo Bank    13166 Atlantic Blvd, Jacksonville,
Fl 32225    Same as above    Wells Fargo

311

   CA    Rocklin    Wells Fargo Bank    781 Pleasant Grove Blvd, Rocklin, CA
95765    Same as above    Wells Fargo

312

   NC    Southern Pines    Wells Fargo Bank    600 SW Broad St, Southern Pines,
NC 28387    Same as above    Wells Fargo

313

   SC    Bluffton    Wells Fargo Bank    Bluffton Financial Center, 11 Arley
Way, Bluffton, SC 29910    Same as above    Wells Fargo

315

   TX    Round Rock    Wells Fargo Bank    1851 A.W Grimes Rd., Round Rock, TX
78664    Same as above    Wells Fargo

317

   GA    Cumming    Wells Fargo Bank    601 Atlanta Rd., Cumming, Ga 30040   
Same as above    Wells Fargo

318

   CA    La Mirada    Wells Fargo Bank    1190 S. Beach Blvd., La Habra, CA
90631    Same as above    Wells Fargo

320

   NC    Morrisville    Wells Fargo Bank    4011 Davis Dr. Morrisville, NC 27560
   Same as above    Wells Fargo

325

   VA    Chantilly    Wells Fargo Bank    14430 Chantilly Crossing, Chantilly,
Va. 20151    Same as above    Wells Fargo

326

   NJ    Franklin Park    Wells Fargo Bank    3510 State Route 27, Franklin
Park, NJ 08824    Same as above    Wells Fargo

332

   FL    Tequesta    Wells Fargo Bank    105 N. US Highway 1, Tequesta, Fl 33469
   Same as above    Wells Fargo

336

   AZ    Queen Creek    Wells Fargo Bank    1731 W. Hunt Way, Queen Creek, AZ
85242    Same as above    Wells Fargo

337

   FL    Port St Lucie    Wells Fargo Bank    1410 SW St. Lucie West Blvd., Port
St Lucie, 34986    Same as above    Wells Fargo

339

   TX    Houston    Wells Fargo Bank    10910 Louetta Rd. Houston, TX 71077   
Same as above    Wells Fargo

341

   GA    Alpharetta    Wells Fargo Bank    4175 Old Milton Parkway, Alpharetta,
GA 30005    Same as above    Wells Fargo

342

   TX    Corpus Christi    Wells Fargo Bank    6000 S. Padre Island Dr., Corpus
Christi, TX 78412    Same as above    Wells Fargo

343

   TX    Hurst    Wells Fargo Bank    6300 Precinct Line Rd, Hurst, TX 76054   
Same as above    Wells Fargo

346

   FL    Sarasota    Wells Fargo Bank    8410 Market St., Bradenton, FL 34202   
Same as above    Wells Fargo

347

   AZ    Tempe    Wells Fargo Bank    1530 N Scotts Dale Rd, Scotts Dale, AZ
85257    Same as above    Wells Fargo

348

   FL    Jacksonville    Wells Fargo Bank    6530 St Augustine Rd, Jacksonville,
Fl 32217    Same as above    Wells Fargo

701

   CA    Rolling Hills    Wells Fargo Bank    27440 Hawthorne Blvd., Rolling
Hills Estates, CA 90274    Same as above    Wells Fargo

703

   NC    Hendersonville    Wells Fargo Bank    301 S. Main St., Hendersonville,
NC 28792    Same as above    Wells Fargo

704

   FL    Fernandina Beach    Wells Fargo Bank    1860 S Eighth St, Fernandina
Beach, FL 32034    Same as above    Wells Fargo

333

   NJ    Holmdel    Wells Fargo Bank    2145 State Route 35, Holmdel, NJ 07733
   Same as above    Wells Fargo

703

   NC    Hendersonville    Wells Fargo Bank    301 S. Main St., Hendersonville,
NC 28792    Same as above    Wells Fargo

704

   FL    Fernandina Beach    Wells Fargo Bank    1860 S Eighth St, Fernandina
Beach, FL 32034    Same as above    Wells Fargo

333

   NJ    Holmdel    Wells Fargo Bank    2145 State Route 35, Holmdel, NJ 07733
   Same as above    Wells Fargo

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

Account Name

  

Bank

   Account #

UHC Medical

   Bank of America    9429042570

UHC FSA

   Bank of America    9429042589

SMI Expense A/P (1)

   Wells Fargo    2079900546075

SMBC A/P (1)

   Wells Fargo    2079900547728

Electronic A/P (1)

   Wells Fargo    2000025402351

SMBC

   Wells Fargo    2000025402364

Corp Misc

   Wells Fargo    2000025402254

Discover/AMEX

   Wells Fargo    2000025402241

Solutran consol’d returns

   Lake Region Bank    454504-F

Payroll (DD) (1)

   Wells Fargo    2000025402348

Visa/Mastercard

   Wells Fargo    2000025402238

Wachovia Master Account

   Wells Fargo    2000025890743

 

(1) these are zero balance accounts

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

Schedule 5.21(b)

CREDIT CARD ARRANGEMENTS

All payment processing/settlement services are provided by the following
entities:

Vantiv Holding, LLC

8500 Governors Hill Drive

Symmes Township, Ohio 45249

American Express

World Financial Center

200 Vesey St.

New York, NY 10285

Discover Financial Services

2500 Lake Cook Road

Riverwoods, Illinois 60015

GE Capital Retail Bank

170 West Election Drive, Suite 125

Draper, Utah 84020

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

Schedule 5.24

MATERIAL CONTRACTS

Agreement for American Express Card Acceptance, effective as of July 1, 2003,
between Stein Mart, Inc. and American Express Travel Related Services Company,
Inc.

Agreement, effective as of May 2, 2011, between Arnold Worldwide, LLC and Stein
Mart, Inc.

Amended and Restated Co-Brand and Private Label Credit Card Consumer Program
Agreement, dated as of October 3, 2011, between Stein Mart, Inc. and GE Capital
Retail Bank.

Bank Merchant Agreement, dated as of June 15, 2000 (as amended from time to
time), between Vantiv Holding, LLC (as successor in interest to Fifth Third
Bank) and Stein Mart, Inc.

Merchant Services Agreement, effective May 1, 2008, between Stein Mart, Inc. and
DFS Services LLC (f/k/a Discover Financial Services LLC).

Transportation & Warehouse Services Agreement, dated as of May 1, 2009, between
Stein Mart, Inc. and National Retail System, Inc.

Transportation Services Agreement, dated as of January 13, 2011 between Stein
Mart, Inc. and Schneider National Carriers, Inc.

Transportation Services Agreement, dated as of June 6, 2011, between Stein Mart,
Inc. and Keystone Freight Corp.

Warehousing Agreement, dated as of May 1, 2009, between Stein Mart, Inc. and APL
Logistics Americas, Ltd.

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

Schedule 6.02

FINANCIAL AND COLLATERAL REPORTING

COLLATERAL REPORTING

In addition to the other materials and information required to be provided
pursuant to the terms of the Credit Agreement, the Loan Parties shall provide
Administrative Agent, on the applicable day specified below, the following
documents (each in such form and detail as the Administrative Agent from time to
time may specify):

Quarterly Reports. Quarterly, the Loan Parties shall provide to Administrative
Agent original counterparts of (each in such form as Administrative Agent from
time to time may specify):

 

  a. On the fifteenth (15th) day of each Fiscal Quarter for the immediately
preceding Fiscal Quarter (or, if such day is not a Business Day, on the next
succeeding Business Day), provided, however, (x) upon the occurrence and during
the continuation of an Accelerated Monthly Borrowing Base Delivery Event, at the
election of the Administrative Agent, on the tenth (10th) day of each Fiscal
Month for the immediately preceding Fiscal Month (or, if such day is not a
Business Day, on the next succeeding Business Day), and (y) upon the occurrence
and during the continuation of an Accelerated Weekly Borrowing Base Delivery
Event, at the election of the Administrative Agent, on Wednesday of each week
for the immediately preceding week (or, if Wednesday is not a Business Day, on
the next succeeding Business Day):

 

  i. On such day, supporting source documents for the Borrowing Base Certificate
delivered in accordance with the Credit Agreement.

 

  b. On the fifteenth (15th) day of each Fiscal Quarter for the immediately
preceding Fiscal Quarter (or, if such day is not a Business Day, on the next
succeeding Business Day), provided, however, upon the occurrence and during the
continuation of an Accelerated Monthly Borrowing Base Delivery Event, at the
election of the Administrative Agent, on the tenth (10th) day of each Fiscal
Month for the immediately preceding Fiscal Month (or, if such day is not a
Business Day, on the next succeeding Business Day):

 

  i. Purchases and accounts payable analysis report, (together with account
payable aging) for each Loan Party, in Administrative Agent’s format;

 

  ii. Inventory summary by Store location;

 

  iii. Inventory summary by department; and

 

  iv. Inventory certificate in Administrative Agent’s format.

 

  c. On the thirtieth (30th) day of each Fiscal Quarter for the immediately
preceding Fiscal Quarter (or, if such day is not a Business Day, on the next
succeeding Business Day), provided, however, upon the occurrence and during the
continuation of an Accelerated Monthly Borrowing Base Delivery Event, at the
election of the Administrative Agent, on the tenth (10th) day of each Fiscal
Month for the immediately preceding Month (or, if such day is not a Business
Day, on the next succeeding Business Day):

 

  i. Reconciliation of the stock ledger to the general ledger;

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

  ii. Gross margin reconciliation, consistent with the Loan Parties’ past
reporting practices;

 

  iii. Statement of Store Activity in Administrative Agent’s format; and

 

  iv. Such other information as the Administrative Agent may from time to time
reasonably request.

For purposes of Sections (a), (b), and (c) above, the first “Fiscal Quarter” in
respect of which the items required by such Section shall be provided shall be
the Fiscal Quarter ending on or about October 31, 2011.

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

Schedule 7.01

EXISTING LIENS

 

Debtor

  

Secured Party

  

Jurisdiction

  

UCC Financing

Statement #’s

  

Collateral Description

Stein Mart, Inc.    Congress Financial Corporation (Florida)    Florida   

20030449527X

20040746038X

20080773472X

   Accounts, General Intangibles, Inventory Stein Mart, Inc.    AT&T Capital
Services, Inc.    Florida   

200602248394

201104181167

   Equipment Stein Mart, Inc.    AT&T Capital Services, Inc.    Florida   

200603021784

201104181248

   Equipment Stein Mart, Inc.    AT&T Capital Services, Inc.    Florida   

200603100250

201104390467

   Equipment Stein Mart, Inc.    AT&T Capital Services, Inc.    Florida   

200603100269

201104390459

   Equipment Stein Mart, Inc.    IDB Leasing, Inc.    Florida   

200603563587

200704933819

200704949804

   Equipment Stein Mart, Inc.    GE Money Bank    Florida   

200603783447

201105166293

   Cardholder Accounts Stein Mart, Inc.    IOS Capital    Florida   
200603833991    Equipment Stein Mart, Inc.    IOS Capital    Florida   
200603834009    Equipment Stein Mart, Inc.    IOS Capital    Florida   
200603834017    Equipment Stein Mart, Inc.    IOS Capital    Florida   
200603849367    Equipment Stein Mart, Inc.    IOS Capital    Florida   
200603849375    Equipment Stein Mart, Inc.    IOS Capital    Florida   
200603904074    Equipment Stein Mart, Inc.    IOS Capital    Florida   
200603904082    Equipment Stein Mart, Inc.    IOS Capital    Florida   
20060394629X    Equipment Stein Mart, Inc.    IBM Credit LLC    Florida   
200604046675    Equipment Stein Mart, Inc.    IBM Credit LLC    Florida   
200604148052    Equipment Stein Mart, Inc.    First Eagle National Bank   
Florida   

200604295063

200704636989

200705094365

   Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    20070449081X   
Equipment Stein Mart, Inc.    CSI Leasing Inc.    Florida   

200704680562

200705802912

   Equipment Stein Mart, Inc.    Dell Financial Services L.P.    Florida   
200704708599    Equipment Stein Mart, Inc.    IBM Credit LLC    Florida   
200705432236    Equipment Stein Mart, Inc.    IOS Capital    Florida   
200705587418    Equipment Stein Mart, Inc.    IOS Capital    Florida   
200705685290    Equipment Stein Mart, Inc.    AT&T Capital Services, Inc.   
Florida    200705752176    Equipment Stein Mart, Inc.    IBM Credit LLC   
Florida    200705912750    Equipment Stein Mart, Inc.    IBM Credit LLC   
Florida    20070635851X    Equipment Stein Mart, Inc.    IBM Credit LLC   
Florida    200706445919    Equipment Stein Mart, Inc.    Banc of America Leasing
& Capital LLC    Florida   

20070700665X

200807883024

200807883032

200807883016

   Equipment Stein Mart, Inc.    Forsythe/McArthur Associates, Inc.    Florida
   200707257741    Equipment Stein Mart, Inc.    IBM Credit LLC    Florida   
200707261366    Equipment Stein Mart, Inc.    Bank of America Leasing & Capital
LLC    Florida   

200707308230

200807459737

   Equipment

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

Stein Mart, Inc.    IBM Credit LLC    Florida    200807354811    Equipment Stein
Mart, Inc.    Banc of America Leasing & Capital, LLC    Florida    200807365112

200809314507

200809315597

   Equipment Stein Mart, Inc.    Banc of America Leasing & Capital, LLC   
Florida    20080781345X

200808763782

200808762085

   Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    200807990998   
Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    200808005047   
Equipment Stein Mart, Inc.    Banc of America Leasing & Capital, LLC    Florida
   200808076432

200809534272

200809534264

   Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    20080829801X   
Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    200808314864   
Equipment Stein Mart, Inc.    CSI Leasing, Inc.    Florida    200808651097   
Equipment Stein Mart, Inc.    Banc of America Leasing & Capital, LLC    Florida
   200808819931

200809332106

200809332343

   Equipment Stein Mart, Inc.    CSI Leasing Inc.    Florida    200808959512   
Equipment Stein Mart, Inc.    National City Commercial Capital Company, LLC   
Florida    200808977561

200809579721

   Equipment Stein Mart, Inc.    CSI Leasing Inc.    Florida    20080897757X

200809475349

   Equipment Stein Mart, Inc.    Banc of America Leasing & Capital, LLC   
Florida    200808977588

200809668635

200809668627

   Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    200809550464   
Equipment Stein Mart, Inc.    DSW Inc.    Florida    200900396618    Consigned
Merchandise Stein Mart, Inc.    AT&T Capital Services, Inc.    Florida   
200900507800    Equipment Stein Mart, Inc.    CSI Leasing, Inc.    Florida   
200900564936    Equipment Stein Mart, Inc.    IBM Credit LLC    Florida   
200900812948    Equipment Stein Mart, Inc.    ePlus Group, inc.    Florida   
200901006880    Equipment Stein Mart, Inc.    CSI Leasing, Inc.    Florida   
200901161185    Equipment Stein Mart, Inc.    Cisco Systems Capital Corporation
   Florida    200901245192    Equipment Stein Mart, Inc.    ePlus Group, inc.   
Florida    200901394937    Equipment Stein Mart, Inc.    Tygris Vendor Finance,
Inc.    Florida    201001965696

201002046465

201002301937

201002829591

   Equipment Stein Mart, Inc.    ePlus Group, inc.    Florida    201002335149   
Equipment Stein Mart, Inc.    ePlus Group, inc.    Florida    201002406232   
Equipment Stein Mart, Inc.    ePlus Group, inc.    Florida    201002821922   
Equipment Stein Mart, Inc.    CSI Leasing, Inc.    Florida    201003162442   
Equipment Stein Mart, Inc.    Scents of Worth, Inc.    Florida    201003210234
   Consigned Merchandise Stein Mart, Inc.    ePlus Group, inc.    Florida   
201003335649    Equipment Stein Mart, Inc.    ePlus Group, inc.    Florida   
201003460125    Equipment Stein Mart, Inc.    CSI Leasing, Inc.    Florida   
201003786969    Equipment Stein Mart, Inc.    Banc of America Leasing & Capital,
LLC    Florida    201003786977

20110402097X

   Equipment Stein Mart, Inc.    Banc of America Leasing & Capital, LLC   
Florida    201003786985

201104020988

   Equipment Stein Mart, Inc.    Banc of America Leasing & Capital, LLC   
Florida    201003786993

201104021011

   Equipment

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

Stein Mart, Inc.    PNCEF, LLC    Florida    201003787000

201003816515

   Equipment Stein Mart, Inc.    Banc of America Leasing & Capital, LLC   
Florida    201003787019

201104020996

   Equipment Stein Mart, Inc.    ePlus Group, inc.    Florida    201003787701   
Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    201103843336   
Equipment Stein Mart, Inc.    ePlus Group, inc.    Florida    201104351402   
Equipment Stein Mart, Inc.    ePlus Group, inc.    Florida    201104887760   
Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    201104910452   
Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    201104938810   
Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    201105113343   
Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    201105113343   
Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    201105257116   
Equipment Stein Mart, Inc.    IBM Credit LLC    Florida    201105394865   
Equipment Stein Mart, Inc.    ePlus Group, inc.    Florida    201105418411   
Equipment Stein Mart Buying Corp.    Congress Financial Corporation (Florida)   
Florida    200304495288

200407460398

200807734738

   Accounts, General Intangibles, Inventory

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

Schedule 7.02

EXISTING INVESTMENTS

As of end of day on October 27, 2011 Stein Mart had $88.280mm invested in daily
money market funds.

Investments are held in a Rabbi Trust for the Deferred Compensation Plan and
investments are made relating to the Split-Dollar Life Insurance Plan.

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

Schedule 7.03

EXISTING INDEBTEDNESS

As of October 28, 2011, there were standby letters of credit outstanding (see
Schedule 1.01(a)) that totaled $8,446,000 relating primarily to workers’
compensation and general liability requirements for various insurance carriers.

As of October 28, 2011, there were capital lease obligations outstanding of
$7,196,044 relating to the acquisition of new point-of-sale registers.

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

Schedule 10.02

ADMINISTRATIVE AGENT’S OFFICE; CERTAIN ADDRESSES FOR NOTICES

 

If to any Borrower or Guarantor:

  

Stein Mart, Inc.

1200 Riverplace Boulevard

   Jacksonville, Florida 32207   

Attention: Gregory W. Kleffner

Telecopy No.: 904-346-1280

   Email: GKleffner@steinmart.com

If to Administrative Agent:

   Wells Fargo Bank, National Association    One Boston Place    18th Floor   
Boston, Massachusetts 02108    Attention: Jennifer Blanchette    Telecopy No.:
877-488-1721    Email: Jennifer.L.Blanchette@wellsfargo.com

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

EXHIBIT A

FORM OF COMMITTED LOAN NOTICE

Date:                     ,         

 

To: Wells Fargo Bank, National Association,

  as Agent

One Boston Place

Boston, MA 02108

Ladies and Gentlemen:

Reference is made to the Amended and Restated Credit Agreement dated as of
October     , 2011 (as amended, modified, supplemented or restated hereafter,
the “Credit Agreement”) by and among (i) Stein Mart, Inc., a Florida
corporation, for itself and as Lead Borrower (in such capacity, the “Lead
Borrower”) for the other Borrowers party thereto from time to time
(individually, a “Borrower” and, collectively, the “Borrowers”), (ii) the
Borrowers party thereto from time to time, (iii) Wells Fargo Bank, National
Association, as administrative and collateral agent (in such capacities, the
“Agent”) for its own benefit and the benefit of the other Credit Parties
referred to therein, (iv) Wells Fargo Bank, National Association, as L/C Issuer,
and (v) the lenders from time to time party thereto (individually, a “Lender”
and, collectively, the “Lenders”). All capitalized terms used herein and not
otherwise defined shall have the same meaning herein as in the Credit Agreement.

 

1.

The Lead Borrower hereby requests [a Borrowing][a conversion of Committed Loans
from one Type to the other][a continuation of LIBO Rate Loans]1:

 

  a.

On                      (a Business Day)2

 

  b.

In the amount of $            3

 

  c.

Comprised of [Base Rate][LIBO Rate] Loans (Type of Committed Loan)4

 

  d.

For LIBO Rate Loans: with an Interest Period of      months5

 

 

1 

A Borrowing must be a borrowing consisting of simultaneous Loans of the same
Type and, in the case of LIBO Rate Loans, must have the same Interest Period.

2 

Each notice of a Borrowing must be received by the Agent not later than 11:00
a.m. (i) three (3) Business Days prior to the requested date of any Borrowing of
LIBO Rate Loans, and (ii) on the Business Day that is the requested date of any
Borrowing of Base Rate Loans.

3 

Each Borrowing, conversion to, or continuation of LIBO Rate Loans must be in a
principal amount of $1,000,000 or a whole multiple of $500,000 in excess
thereof. Each Borrowing, conversion to, or continuation of Base Rate Loans must
be in a principal amount of $50,000 or a whole multiple of $10,000 in excess
thereof.

4 

Committed Loans may be Base Rate Loans or LIBO Rate Loans. If the Type of
Committed Loan is not specified, then the applicable Committed Loans will be
made as Base Rate Loans.

5 

The Lead Borrower may request a Borrowing of LIBO Rate Loans with an Interest
Period of one, two or three months. If no election of Interest Period is
specified, then the Lead Borrower will be deemed to have specified an Interest
Period of one month.

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

The Lead Borrower hereby represents and warrants (for itself and on behalf of
the other Borrowers) that (a) the Borrowing requested herein complies with
Section 2.02 and the other provisions of the Credit Agreement and (b) the
conditions specified in Sections 4.01 and 4.02 of the Credit Agreement have been
satisfied on and as of the date specified in Item 1(a) above.

[Signature Page Follows]

 

2

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

Dated as of the date above first written.

 

STEIN MART, INC., as Lead Borrower By:  

 

Name:  

 

Title:  

 

 

3

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EXHIBIT B

FORM OF SWING LINE LOAN NOTICE

Date:                  ,         

 

To: Wells Fargo Bank, National Association, as Swing Line Lender

Wells Fargo Bank, National Association, as Agent

One Boston Place

Boston, MA 02108

Ladies and Gentlemen:

Reference is made to the Amended and Restated Credit Agreement dated as of
October [    ], 2011 (as amended, modified, supplemented or restated hereafter,
the “Credit Agreement”) by and among (i) Stein Mart, Inc., a Florida
corporation, for itself and as Lead Borrower (in such capacity, the “Lead
Borrower”) for the other Borrowers party thereto from time to time
(individually, a “Borrower” and, collectively, the “Borrowers”), (ii) the
Borrowers party thereto from time to time, (iii) Wells Fargo Bank, National
Association, as administrative and collateral agent (in such capacities, the
“Agent”) for its own benefit and the benefit of the other Credit Parties
referred to therein, (iv) Wells Fargo Bank, National Association, as LC Issuer,
and (v) the lenders from time to time party thereto (individually, a “Lender”
and, collectively, the “Lenders”). All capitalized terms used herein and not
otherwise defined shall have the same meaning herein as in the Credit Agreement.

The Lead Borrower hereby requests a Swing Line Borrowing:

 

  1.

On                                          (a Business Day)6

 

  2.

In the amount of $            7

The Swing Line Borrowing requested herein complies with the provisions of
Section 2.04 of the Credit Agreement.

 

STEIN MART, INC., as Lead Borrower By:  

 

Name:  

 

Title:  

 

 

6 

Each notice of a Swing Line Borrowing must be received by the Swing Line Lender
and the Agent not later than 1:00 p.m. on the requested date of any Swing Line
Borrowing.

7 

Each Swing Line Borrowing must be in a minimum amount of $50,000.

 

4

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EXHIBIT C-1

FORM OF NOTE

 

 

NOTE

 

 

 

$            

                      ,          

FOR VALUE RECEIVED, the undersigned (individually, a “Borrower” and,
collectively, the “Borrowers”), jointly and severally promise to pay to the
order of                      (hereinafter, with any subsequent holders, the
“Lender”), c/o Wells Fargo Bank, National Association, One Boston Place, Boston,
Massachusetts 02108, the principal sum of                      ($            ),
or, if less, the aggregate unpaid principal balance of Committed Loans made by
the Lender to or for the account of any Borrower pursuant to the Amended and
Restated Credit Agreement dated as of October [    ], 2011 (as amended,
modified, supplemented or restated and in effect from time to time, the “Credit
Agreement”) by and among (i) the Borrowers, (ii) Wells Fargo Bank, National
Association, as administrative and collateral agent (in such capacities, the
“Agent”) for its own benefit and the benefit of the other Credit Parties
referred to therein, (iii) Wells Fargo Bank, National Association, as LC Issuer,
and (iv) the lenders from time to time party thereto (individually, a “Lender”
and, collectively, the “Lenders”), with interest at the rate and payable in the
manner stated therein.

This is a “Note” to which reference is made in the Credit Agreement and is
subject to all terms and provisions thereof. The principal of, and interest on,
this Note shall be payable at the times, in the manner, and in the amounts as
provided in the Credit Agreement and shall be subject to prepayment and
acceleration as provided therein. Capitalized terms used herein and not defined
herein shall have the meanings assigned to such terms in the Credit Agreement.

The Agent’s books and records concerning the Committed Loans, the accrual of
interest thereon, and the repayment of such Committed Loans, shall be prima
facie evidence of the indebtedness to the Lender hereunder.

No delay or omission by Agent or the Lender in exercising or enforcing any of
Agent’s or the Lender’s powers, rights, privileges, remedies, or discretions
hereunder shall operate as a waiver thereof on that occasion nor on any other
occasion. No waiver of any Event of Default shall operate as a waiver of any
other Event of Default, nor as a continuing waiver of any such Event of Default.

Each Borrower, and each endorser and guarantor of this Note, waives presentment,
demand, notice, and protest, and also waives any delay on the part of the holder
hereof. Each Borrower assents to any extension or other indulgence (including,
without limitation, the release or substitution of Collateral) permitted by
Agent and/or the Lender with respect to this Note and/or any Collateral or any
extension or other indulgence with respect to any other liability or any
collateral given to secure any other liability of any Borrower or any other
Person obligated on account of this Note.

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

This Note shall be binding upon each Borrower, and each endorser and guarantor
hereof, and upon their respective successors, assigns, and representatives, and
shall inure to the benefit of the Lender and its successors, endorsees, and
assigns.

The liabilities of each Borrower, and of any endorser or guarantor of this Note,
are joint and several, provided, that, the release by Agent or the Lender of any
one or more such Persons shall not release any other Person obligated on account
of this Note. Each reference in this Note to any Borrower, any endorser, and any
guarantor, is to such Person individually and also to all such Persons jointly.
No Person obligated on account of this Note may seek contribution from any other
Person also obligated unless and until all of the Obligations have been paid in
full in cash.

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

EACH OF THE BORROWERS IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND
ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW
YORK SITTING IN NEW YORK COUNTY AND ANY FEDERAL COURT SITTING THEREIN, AND ANY
APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS NOTE OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE BORROWERS IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE
BORROWERS AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS NOTE OR IN ANY OTHER LOAN
DOCUMENT SHALL AFFECT ANY RIGHT THAT THE AGENT OR THE LENDER MAY OTHERWISE HAVE
TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS NOTE OR ANY OTHER LOAN
DOCUMENT AGAINST ANY OF THE BORROWERS OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.

EACH OF THE BORROWERS IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS NOTE OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO ABOVE.
EACH OF THE BORROWERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

Each Borrower makes the following waiver knowingly, voluntarily, and
intentionally, and understands that the Agent and the Lender, in the
establishment and maintenance of their respective relationship with the
Borrowers contemplated by this Note, are each relying thereon. EACH BORROWER,
EACH GUARANTOR, ENDORSER AND SURETY, AND THE LENDER, BY ITS ACCEPTANCE HEREOF,
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS NOTE OR ANY OTHER LOAN DOCUMENT OR
THE TRANSACTIONS CONTEMPLATED

 

2

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

HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
BORROWER (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT THE AGENT AND THE LENDER HAVE BEEN INDUCED TO ENTER INTO
THE CREDIT AGREEMENT AND THIS NOTE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS HEREIN.

[SIGNATURE PAGE FOLLOWS]

 

3

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

IN WITNESS WHEREOF, the Borrowers have caused this Note to be duly executed as
of the date set forth above.

 

BORROWERS: STEIN MART, INC. By:  

 

Name:  

 

Title:  

 

STEIN MART BUYING CORP. By:  

 

Name:  

 

Title:  

 

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

EXHIBIT C-2

FORM OF SWING LINE NOTE

 

 

SWING LINE NOTE

 

 

 

$            

                 ,            

FOR VALUE RECEIVED, the undersigned (individually, a “Borrower” and,
collectively, the “Borrowers”), jointly and severally promise to pay to the
order of WELLS FARGO BANK, NATIONAL ASSOCIATION (hereinafter, with any
subsequent holders, the “Swing Line Lender”), One Boston Place, Boston,
Massachusetts 02108, the principal sum of                      DOLLARS
($            ), or, if less, the aggregate unpaid principal balance of Swing
Line Loans made by the Swing Line Lender to or for the account of any Borrower
pursuant to the Amended and Restated Credit Agreement dated as of October
[    ], 2011 (as amended, modified, supplemented or restated and in effect from
time to time, the “Credit Agreement”) by and among (i) the Borrowers, (ii) Wells
Fargo Bank, National Association, as administrative and collateral agent (in
such capacities, the “Agent”) for its own benefit and the benefit of the other
Credit Parties referred to therein, (iii) Wells Fargo Bank, National
Association, as LC Issuer, and (iv) the lenders from time to time party thereto
(individually, a “Lender” and, collectively, the “Lenders”), with interest at
the rate and payable in the manner stated therein.

This is a “Swing Line Note” to which reference is made in the Credit Agreement
and is subject to all terms and provisions thereof. The principal of, and
interest on, this Swing Line Note shall be payable at the times, in the manner,
and in the amounts as provided in the Credit Agreement and shall be subject to
prepayment and acceleration as provided therein. Capitalized terms used herein
and not defined herein shall have the meanings assigned to such terms in the
Credit Agreement.

The Agent’s books and records concerning the Swing Line Loans, the accrual of
interest thereon, and the repayment of such Swing Line Loans, shall be prima
facie evidence of the indebtedness to the Lender hereunder.

No delay or omission by Agent or the Swing Line Lender in exercising or
enforcing any of Agent’s or the Swing Line Lender’s powers, rights, privileges,
remedies, or discretions hereunder shall operate as a waiver thereof on that
occasion nor on any other occasion. No waiver of any Event of Default shall
operate as a waiver of any other Event of Default, nor as a continuing waiver of
any such Event of Default.

Each Borrower, and each endorser and guarantor of this Swing Line Note, waives
presentment, demand, notice, and protest, and also waives any delay on the part
of the holder hereof. Each Borrower assents to any extension or other indulgence
(including, without limitation, the release or substitution of Collateral)
permitted by Agent and/or the Lender with respect to this Swing Line Note and/or
any Collateral or any extension or other indulgence with respect to any other
liability or any collateral given to secure any other liability of any Borrower
or any other Person obligated on account of this Swing Line Note.

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

This Swing Line Note shall be binding upon each Borrower, and each endorser and
guarantor hereof, and upon their respective successors, assigns, and
representatives, and shall inure to the benefit of the Lender and its
successors, endorsees, and assigns.

The liabilities of each Borrower, and of any endorser or guarantor of this Swing
Line Note, are joint and several, provided, that, the release by Agent or the
Lender of any one or more such Persons shall not release any other Person
obligated on account of this Swing Line Note. Each reference in this Swing Line
Note to any Borrower, any endorser, and any guarantor, is to such Person
individually and also to all such Persons jointly. No Person obligated on
account of this Swing Line Note may seek contribution from any other Person also
obligated unless and until all of the Obligations have been paid in full in
cash.

THIS SWING LINE NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES
THEREOF.

EACH OF THE BORROWERS IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND
ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW
YORK SITTING IN NEW YORK COUNTY AND ANY FEDERAL COURT SITTING THEREIN, AND ANY
APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS SWING LINE NOTE OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION
OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE BORROWERS IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE
BORROWERS AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS SWING LINE NOTE OR IN ANY
OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE AGENT OR THE SWING LINE
LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS
SWING LINE NOTE OR ANY OTHER LOAN DOCUMENT AGAINST ANY OF THE BORROWERS OR ITS
PROPERTIES IN THE COURTS OF ANY JURISDICTION.

EACH OF THE BORROWERS IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS SWING LINE NOTE OR ANY OTHER LOAN DOCUMENT IN ANY COURT
REFERRED TO ABOVE. EACH OF THE BORROWERS HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM
TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

Each Borrower makes the following waiver knowingly, voluntarily, and
intentionally, and understands that the Agent and the Lender, in the
establishment and maintenance of their respective relationship with the
Borrowers contemplated by this Swing Line Note, are each relying thereon. EACH
BORROWER, EACH GUARANTOR, ENDORSER AND SURETY, AND THE SWING LINE LENDER, BY ITS
ACCEPTANCE HEREOF, HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF

 

2

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

OR RELATING TO THIS SWING LINE NOTE OR ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR
ANY OTHER THEORY). EACH BORROWER (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT THE AGENT AND THE SWING LINE LENDER
HAVE BEEN INDUCED TO ENTER INTO THE CREDIT AGREEMENT AND THIS NOTE BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS HEREIN.

[SIGNATURE PAGE FOLLOWS]

 

3

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

IN WITNESS WHEREOF, the Borrowers have caused this Swing Line Note to be duly
executed as of the date set forth above.

 

BORROWERS: STEIN MART, INC. By:  

 

Name:  

 

Title:  

 

STEIN MART BUYING CORP. By:  

 

Name:  

 

Title:  

 

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

EXHIBIT D

FORM OF COMPLIANCE CERTIFICATE

 

To:    Wells Fargo Bank, National Association    Date:                       
One Boston Place, 18th Floor       Boston, MA 02108       Attention: Portfolio
Manager   

Re: Amended and Restated Credit Agreement dated as of October [    ], 2011 (as
amended, modified, supplemented or restated hereafter, the “Credit Agreement”)
by and among (i) Stein Mart, Inc., a Florida corporation, for itself and as Lead
Borrower (in such capacity, the “Lead Borrower”) for the other Borrowers party
thereto from time to time (individually, a “Borrower” and, collectively, the
“Borrowers”), (ii) the Borrowers party thereto from time to time, (iii) Wells
Fargo Bank, National Association, as administrative and collateral agent (in
such capacities, the “Agent”) for its own benefit and the benefit of the other
Credit Parties referred to therein, (iv) Wells Fargo Bank, National Association,
as L/C Issuer, and (v) the lenders from time to time party thereto
(individually, a “Lender” and, collectively, the “Lenders”). All capitalized
terms used herein and not otherwise defined shall have the same meaning herein
as in the Credit Agreement.

The undersigned, a duly authorized and acting Responsible Officer of the Lead
Borrower, hereby certifies to you as follows:

 

1. No Default.

 

  a. To the knowledge of the undersigned Responsible Officer, except as set
forth in Appendix I, no Default or Event of Default has occurred and is
continuing.

 

  b. If a Default or Event of Default has occurred and is continuing, the
Borrowers propose to take action as set forth in Appendix I with respect to such
Default or Event of Default.

 

2. No Material Accounting Changes, Etc. The financial statements furnished to
the Agent for the month/year ending [            ] were prepared in accordance
with GAAP consistently applied and present fairly in all material respects the
financial condition of Lead Borrower and its Subsidiaries on a Consolidated
basis at the close of, and the results of the Borrowers’ operations and cash
flows for, the period(s) covered, subject to, with respect to the monthly
financial statements, normal year end audit adjustments and the absence of
footnotes. There has been no change in GAAP and the application thereof since
the date of the financial statements furnished to the Agent for the year ending
[            ], other than the material accounting changes as disclosed on
Appendix II hereto.

 

3. Payables. Except as described in Appendix III attached hereto and except for
items being properly contested, all rent, utility, lease, trade liabilities and
other obligations, inclusive of all taxes and insurance, are current and being
paid as agreed and there are no held or post-dated checks outstanding with
respect to any such obligations. If any such obligations are not current or if
there are any held or post-dated checks outstanding, the Loan Parties have taken
or propose to take those actions with respect to such obligations and/or held or
post-dated checks as described on said Appendix III.

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

4. Representations and Warranties. The representations and warranties of each
Loan Party contained in the Loan Agreement and the other Loan Documents are
true, correct, and complete in all material respects on and as of the date
hereof, as though made on and as of the date hereof (except (i) to the extent
that such representations and warranties relate solely to an earlier date, in
which case such representations and warranties are true, correct, and complete
in all material respects as of such earlier date, (ii) in the case of any
representation and warranty qualified by materiality, they shall be true and
correct in all respects, and (iii) for purposes of Section 4.02 of the Credit
Agreement, the representations and warranties contained in subsections (a) and
(b) of Section 5.05 shall be deemed to refer to the most recent statements
furnished pursuant to clauses (a) and (b), respectively, of Section 6.01 of the
Credit Agreement).

 

2

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

IN WITNESS WHEREOF, I have executed this certificate as of the date first
written above.

 

STEIN MART, INC. By:  

 

Name:  

 

Title:  

 

 

3

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

APPENDIX I

Except as set forth below, no Default or Event of Default presently exists. [If
a Default or Event of Default exists, the following describes the nature of the
Default in reasonable detail and the steps being taken or contemplated by the
Borrowers to be taken on account thereof.]

 

4

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

APPENDIX II

Except as set forth below, no material changes in GAAP or the application
thereof have occurred since [the date of the most recently delivered financial
statements to the Agent prior to the date of this Certificate]. [If material
changes in GAAP or in application thereof have occurred, the following describes
the nature of the changes in reasonable detail and the effect, if any, of each
such material change in GAAP or in application thereof in the determination of
the calculation of the financial statements described in the Credit Agreement].

 

5

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

APPENDIX III

PAST DUE OBLIGATIONS; CHECKS HELD

 

6

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

EXHIBIT E

FORM OF ASSIGNMENT AND ASSUMPTION

Reference is made to the Amended and Restated Credit Agreement dated as of
October [    ], 2011 (as amended, modified, supplemented or restated hereafter,
the “Credit Agreement”) by and among (i) Stein Mart, Inc., a Florida
corporation, for itself and as Lead Borrower (in such capacity, the “Lead
Borrower”) for the other Borrowers party thereto from time to time
(individually, a “Borrower” and, collectively, the “Borrowers”), (ii) the
Borrowers party thereto from time to time, (iii) Wells Fargo Bank, National
Association, as administrative ad collateral agent (in such capacities, the
“Agent”) for its own benefit and the benefit of the other Credit Parties
referred to therein, (iv) Wells Fargo Bank, National Association, as LC Issuer,
and (v) the lenders from time to time party thereto (individually, a “Lender”
and, collectively, the “Lenders”). All capitalized terms used herein and not
otherwise defined shall have the same meaning herein as in the Credit Agreement.

                                          (the “Assignor”) and
                                 (the “Assignee”) agree as follows:

 

1. The Assignor hereby sells and assigns to the Assignee, and the Assignee
hereby purchases and assumes from the Assignor, that interest in and to the
Assignor’s rights and obligations as a Lender under the Credit Agreement as of
the date hereof (including, without limitation, such interest in each of the
Assignor’s outstanding Commitments, if any, and the Loans (and related
Obligations) owing to it) specified in Section 1 of Schedule I hereto. After
giving effect to such sale and assignment, the Assignor’s and the Assignee’s
Commitments and the amount of the Loans owing to the Assignor and the Assignee
and the amount of Letters of Credit participated in by the Assignor and the
Assignee will be as set forth in Section 2 of Schedule I hereto.

 

2. The Assignor: (a) represents and warrants that 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 Liens and that it is legally authorized to enter into this
Assignment and Assumption; (b) makes no representation or warranty and assumes
no responsibility with respect to (i) any statements, warranties or
representations made in, or in connection with, the Credit Agreement or any
other Loan Document or any other instrument or document furnished pursuant
thereto, or (ii) the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement or any other Loan Document or any
other instrument or document furnished pursuant thereto; (c) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of any Loan Party or the performance or observance by any
Loan Party of any of their respective obligations under the Credit Agreement or
any other Loan Document or any other instrument or document furnished pursuant
thereto; and (d) confirms, in the case of an Assignee who is not a Lender, an
Affiliate of a Lender, or an Approved Fund, the aggregate amount of the
Commitment (which for this purpose includes Loans outstanding thereunder) or, if
the Commitment is not then in effect, the principal outstanding balance of the
Loans of the Assignor subject to this Assignment and Assumption, is not less
than $            , or, if less, the entire remaining amount of the Assignor’s
Commitment and the Loans at any time owing to it, unless each of the Agent, the
LC Issuer and the Swing Line Lender and, so long as no Default or Event of
Default has occurred and is continuing, the Lead Borrower otherwise consent
(each such consent not to be unreasonably withheld or delayed).

 

3.

The Assignee: (a) confirms that it has received a copy of the Credit Agreement,
together with copies of the financial statements referred to in Section 6.01
thereof and such other documents

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

 

and information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Assumption; (b) agrees that it will,
independently and without reliance upon the Agent, the Assignor or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Credit Agreement; (c) appoints and authorizes the Agent to take
such action as agent on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (d) agrees that it will perform in
accordance with their terms all of the obligations which, by the terms of the
Credit Agreement, are required to be performed by it as a Lender; (e) specifies
as its lending office (and address for notices) the office set forth beneath its
name on the signature pages hereof; (f) agrees that, if the Assignee is a
Foreign Lender entitled to an exemption from, or reduction of, withholding tax
under the law of the jurisdiction in which the applicable Loan Party is resident
for tax purposes, it shall deliver to the Loan Parties and the Agent (in such
number of copies as shall be requested by the recipient) whichever of the
following is applicable: (i) duly completed copies of Internal Revenue Service
Form W-8BEN claiming eligibility for benefits of an income tax treaty to which
the United States is a party, (ii) duly completed copies of Internal Revenue
Service Form W-8ECI, (iii) in the case of a Foreign Lender claiming the benefits
of the exemption for portfolio interest under section 881(c) of the Code, (A) a
certificate to the effect that such Foreign Lender is not (1) a “bank” within
the meaning of section 881(c)(3)(A) of the Code, (2) a “10 percent shareholder”
of the Loan Parties within the meaning of section 881(c)(3)(B) of the Code, or
(3) a “controlled foreign corporation” described in section 881(c)(3)(C) of the
Code and (B) duly completed copies of Internal Revenue Service Form W-8BEN, or
(iv) any other form prescribed by applicable law as a basis for claiming
exemption from, or a reduction in, United States Federal withholding tax, duly
completed, together with such supplementary documentation as may be prescribed
by applicable law to permit the Borrowers to determine the withholding or
deduction required to be made; and (g) represents and warrants that it is an
Eligible Assignee.

 

4. Following the execution of this Assignment and Assumption by the Assignor and
the Assignee, it will be delivered, together with a processing and recordation
fee in the amount required as set forth in Section 10.06 to the Credit
Agreement, to the Agent for acceptance and recording by the Agent. The effective
date of this Assignment and Assumption shall be the date of acceptance thereof
by the Agent, unless otherwise specified on Schedule I hereto (the “Effective
Date”).

 

5. Upon such acceptance and recording by the Agent and, to the extent required
by Section 10.06(b)(iii) of the Credit Agreement, consent by the Agent, the LC
Issuer, the Swing Line Lender and the Lead Borrower, as applicable (such consent
not to be unreasonably withheld or delayed), from and after the Effective Date,
(a) the Assignee shall be a party to the Credit Agreement and, to the extent of
the interest assigned by this Assignment and Assumption, shall have the rights
and obligations of a Lender under the Credit Agreement, and (b) the Assignor
shall, to the extent of the interest assigned by this Assignment and Assumption,
be released from its obligations under the Credit Agreement.

 

6. Upon such acceptance and recording by the Agent, from and after the Effective
Date, the Agent shall make all payments under the Credit Agreement in respect of
the interest assigned hereby (including, without limitation, all payments of
principal, interest and fees with respect thereto) to the Assignee. The Assignor
and Assignee shall make all appropriate adjustments in payments under the Credit
Agreement for periods prior to the Effective Date directly between themselves.

 

2

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7. This Assignment and Assumption shall be governed by, and be construed in
accordance with, the laws of the State of New York, without regard to conflicts
of laws principles thereof.

[SIGNATURE PAGE FOLLOWS]

 

3

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IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Assumption to be executed by their respective officers thereunto duly
authorized, as of the date first above written.

 

[ASSIGNOR] By:  

 

Name:  

 

Title:  

 

[ASSIGNEE] By:  

 

Name:  

 

Title:  

 

Lending Office (and address for notices): [Address]

 

Accepted this      day

of             ,         :

WELLS FARGO BANK, NATIONAL ASSOCIATION
as Agent

By:

 

 

Name:

 

 

Title:

 

 

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

Acknowledged and, to the extent required by Section 10.06(b)(iii) of the Credit
Agreement, consented to, this      day of             ,         :

 

AGENT: WELLS FARGO BANK, NATIONAL ASSOCIATION By:  

 

Name:  

 

Title:  

 

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

Acknowledged and, to the extent required by Section 10.06(b)(iii) of the Credit
Agreement, consented to, this      day of             ,         :

 

LC ISSUER: WELLS FARGO BANK, NATIONAL ASSOCIATION By:  

 

Name:  

 

Title:  

 

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

Acknowledged and, to the extent required by Section 10.06(b)(iii) of the Credit
Agreement, consented to, this      day of             ,         :

 

SWING LINE LENDER: WELLS FARGO BANK, NATIONAL ASSOCIATION By:  

 

Name:  

 

Title:  

 

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

Acknowledged and, to the extent required by Section 10.06(b)(iii) of the Credit
Agreement, consented to, this      day of             ,         :

 

LEAD BORROWER:

STEIN MART, INC.

By:  

 

Name:  

 

Title:  

 

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

Schedule I

Section 1. Percentage/Amount of Commitments/Loans/Letters of Credit Assigned by
Assignor to Assignee.

 

Applicable Percentage assigned by Assignor:

              % 

Commitment assigned by Assignor:

   $                

Commitment assigned by Assignor:

   $                

Aggregate Outstanding Principal Amount of Loans assigned by Assignor:

   $                

Aggregate Participations assigned by Assignor in LC Obligations:

   $                

Section 2. Percentage/Amount of Commitments/Loans/Letters of Credit Held by
Assignor and Assignee after giving effect to Assignment and Assumption.

 

Assignor’s Applicable Percentage

              % 

Assignee’s Applicable Percentage:

              % 

Assignor’s Commitment:

   $                

Assignee’s Commitment:

   $                

Aggregate Outstanding Principal Amount of Loans Owing to Assignor:

   $                

Aggregate Outstanding Principal Amount of Loans Owing to Assignee:

   $                

Aggregate Participations by Assignor in LC Obligations:

   $                

Aggregate Participations by Assignee in LC Obligations:

   $                

Section 3. Effective Date

 

Effective Date:

                 ,            

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

EXHIBIT F

FORM OF BORROWING BASE CERTIFICATE

[See attached.]

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

EXHIBIT G

[RESERVED]

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

EXHIBIT H

FORM OF DDA NOTIFICATION

PREPARE ON BORROWER LETTERHEAD - ONE FOR EACH DEPOSITORY

[DATE]

 

To: [Name and Address of Bank]

 

  Re: [                                         ]

The Account Numbers referenced on Exhibit A annexed hereto

Dear Sir/Madam:

This letter relates to the Account Numbers referenced on Exhibit A annexed
hereto and any other depository account(s) (collectively the “Account”) which
[                    ], a [                    ] with an address at
[                                        ] (the “Borrower”), now or hereafter
maintains with you. The term “Account” shall also mean any certificates of
deposit, investments, or other evidence of indebtedness heretofore or hereafter
issued by you to or for the account of the Borrower.

Under various agreements between, among others, the Borrower and Wells Fargo
Bank, National Association, a national banking association with an office at One
Boston Place, 18th Floor, Boston, MA 02108, as administrative and collateral
agent (in such capacities, herein the “Agent”) for its own benefit and the
benefit of a syndicate of revolving lenders and certain other credit parties
(the “Credit Parties”), the Borrower has granted to the Agent (for its own
benefit and the benefit of the Credit Parties) security interests in and to,
among other things, the Borrower’s accounts, accounts receivable, inventory, and
proceeds therefrom, including, without limitation, the proceeds now or hereafter
deposited in the Account or evidenced thereby. Consequently, the present and all
future contents of the Account constitute the Agent’s collateral.

From the date hereof, until you receive written notification from the Agent that
the interest of the Agent and the other Credit Parties in the Accounts has been
terminated, you may be instructed from time to time in writing by an officer of
the Agent to transfer all or any portion of the funds on deposit in each of the
Accounts to an account designated in such written instruction.

 

1

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Upon request of the Agent, a copy of each statement issued with respect to the
Account should be provided to the Agent at the following addresses (which
address may be changed upon seven (7) days’ written notice given to you by the
Agent):

Wells Fargo Bank, National Association

One Boston Place

Boston, MA 02108

Attention:                         

Re: Stein Mart, Inc.

You shall be fully protected in acting on any order or direction by the Agent
respecting the Accounts without making any inquiry whatsoever as to the Agent’s
right or authority to give such order or direction or as to the application of
any payment made pursuant thereto. Nothing contained herein is intended to, nor
shall it be deemed to, modify the rights and obligations of the Borrower and the
Agent under the terms of the loan arrangement and the loan documents executed in
connection therewith between, among others, the Borrower and the Agent.

This letter may be amended only by notice in writing signed by the Borrower and
an officer of the Agent and may be terminated solely by written notice signed by
an officer of the Agent.

[signature page follows]

 

2

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Very truly yours, [                                         ], as Borrower By:  

 

Name:  

 

Title:  

 

 

cc: Wells Fargo Bank, National Association

Signature Page to DDA Notification

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

Exhibit A

Accounts

[see attached]

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

EXHIBIT I

FORM OF CREDIT CARD NOTIFICATION

PREPARE ON BORROWER LETTERHEAD - ONE FOR EACH PROCESSOR

                    ,         

 

To: [Name and Address of Credit Card Processor] (The “Processor”)

 

  Re: [            ] (the “Company”)

Merchant Account Number:             

Dear Sir/Madam:

Under various agreements between and among the Company, certain affiliates of
the Company, Wells Fargo Bank, National Association, a national banking
association with offices at One Boston Place, Boston, MA 02108, as
administrative and collateral agent (the “Agent”) for a syndicate of lenders and
other credit parties (the “Credit Parties”) party to an Amended and Restated
Credit Agreement dated as of October [    ], 2011 (as amended, modified or
supplemented from time to time, the “Credit Agreement”), the Company has granted
to the Agent, for its own benefit and the benefit of the other Credit Parties, a
security interest in and to the Company’s inventory, accounts, general
intangibles, equipment, and other assets, including, without limitation, all
amounts due or to become due from the Processor to the Company.

Under such agreements, the Company is obligated to deliver (or cause to be
delivered) all proceeds of the Company’s accounts, accounts receivable, and
inventory to the Agent. Such proceeds include all payments with respect to
credit card charges (the “Charges”) submitted by the Company to the Processor
for processing and the amounts which the Processor owes to the Company on
account thereof (the “Credit Card Proceeds”).

 

1. Until the Processor receives written notification from an officer of the
Agent to the contrary, all amounts as may become due from time to time from the
Processor to the Company shall continue to be transferred only as follows:

 

  a. By ACH, Depository Transfer Check, or Electronic Depository Transfer to:

Wells Fargo Bank, N.A.

RNT #121000248

Acct #                

Reference: Stein Mart

or

 

  b. As the Processor may be instructed from time to time in writing by an
officer of the Agent.

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

2. Upon request of the Agent, a copy of each periodic statement provided by the
Processor to the Company should be provided to the Agent at the following
address (which address may be changed upon seven (7) days’ written notice given
to the Processor by the Agent):

Wells Fargo Bank, National Association

One Boston Place

Boston, MA 02108

Attention:        Portfolio Manager

Re:                   Stein Mart

 

3. The Processor shall be fully protected in acting on any order or direction by
the Agents respecting the Charges and the Credit Card Proceeds without making
any inquiry whatsoever as to the Agent’s right or authority to give such order
or direction or as to the application of any payment made pursuant thereto.

 

2

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This letter may be amended only by the written agreement of the Processor, the
Company, and an officer of the Agent and may be terminated solely by written
notice signed by an officer of the Agent.

 

Very truly yours,

[                                         ], as the Company

By:

 

 

Name:

 

 

Title:

 

 

 

cc: Wells Fargo Bank, National Association