EXHIBIT 10.2

FIRST AMENDMENT TO CREDIT AGREEMENT

THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this “First Amendment”) is dated as of
March 17, 2014, among INTERLINE BRANDS, INC., a New Jersey corporation (the
“Company”), WILMAR FINANCIAL, INC., a Delaware corporation (“Wilmar Financial”),
JANPAK, LLC, a West Virginia limited liability company (“JanPak”), JANPAK OF
SOUTH CAROLINA, LLC, a South Carolina limited liability company (“JanPak SC”),
JANPAK OF TEXAS, LLC, a Texas limited liability company (“JanPak Texas”), IBI
MERCHANDISING SERVICES, INC., a Delaware corporation (“IBI Merchandising”, and
together with the Company, Wilmar Financial, JanPak, JanPak SC and JanPak Texas,
the “Borrowers”), INTERLINE BRANDS, INC., a Delaware corporation (“Holdings”),
GLENWOOD ACQUISITION LLC, a Delaware limited liability company (“Glenwood”), and
ZIP TECHNOLOGY, LLC a West Virginia limited liability company (“Zip LLC”, and
together with Holdings, Glenwood and the Borrowers, the “Loan Parties”), the
Lenders signatory hereto, and BANK OF AMERICA, N.A., a national banking
association, in its capacity as administrative agent for the Lenders (the
“Administrative Agent”). Capitalized terms used and not otherwise defined herein
shall have the meanings assigned to such terms in the Existing Credit Agreement
referred to below.

RECITALS:

A. The Company, Wilmar Holdings, Inc., a Delaware corporation (“Wilmar
Holdings”), and Wilmar Financial, as borrowers, Holdings and Glenwood, as
guarantors, the financial institutions party thereto as lenders (the “Lenders”)
and the Administrative Agent entered into that certain Credit Agreement dated as
of September 7, 2012 (as amended, supplemented or otherwise modified from time
to time prior to the date hereof, including by that certain Joinder Agreement
dated as of December 11, 2012, among JanPak, JanPak SC, JanPak Texas and Zip LLC
(or their respective predecessors-in-interest) and the Administrative Agent and
by that certain Joinder Agreement dated as of April 4, 2013, between IBI
Merchandising and the Administrative Agent, the “Existing Credit Agreement”),
pursuant to which the Lenders have agreed to make Loans and provide certain
other credit accommodations to the Borrowers.

B. In order to induce the Lenders to enter into the Existing Credit Agreement,
Holdings, the Company, Wilmar Financial, Wilmar Holdings and Glenwood entered
into that certain Pledge and Security Agreement dated as of September 7, 2012
(as amended, supplemented or otherwise modified from time to time prior to the
date hereof, including by the Supplement to Pledge and Security Agreement dated
as of December 11, 2013, among JanPak, JanPak SC, JanPak Texas and Zip LLC (or
their respective predecessors-in-interest) and the Administrative Agent and the
Supplement to Pledge and Security Agreement dated as of April 4, 2013, between
IBI Merchandising and the Administrative Agent, the “Security Agreement”),
pursuant to which the Loan Parties granted to the Administrative Agent, for the
benefit of the Secured Parties, a security interest in their respective personal
property as security for the Secured Obligations. Wilmar Holdings was
subsequently merged with and into the Company with the Company as the surviving
entity.

 

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C. The Company, Holdings, the subsidiaries of the Company party thereto,
Barclays Bank PLC, as administrative agent and collateral agent (the “Term Loan
Agent”), and the lenders party thereto are entering into that certain First Lien
Term Loan Agreement dated as of even date herewith (the “Term Loan Agreement”),
the proceeds of which will be used by the Company to, among other things,
refinance all of the Company Notes issued and outstanding as of date hereof (the
“Company Notes Refinancing”).

D. In connection with (i) the entry by the Company and Holdings into the Term
Loan Agreement and (ii) the Company Notes Refinancing, the Borrowers have
requested, and the Required Lenders have agreed, to amend the Existing Credit
Agreement to (A) address the fact (x) that the Company Notes are being
refinanced with the proceeds of the Term Loan Agreement and (y) that the
obligations under the Term Loan Agreement will be secured by a lien on the
Collateral, including a first-priority lien on the Notes Priority Collateral (as
defined in the Intercreditor Agreement) and a second-priority lien on the
Revolving Facility Priority Collateral (as defined in the Intercreditor
Agreement), (B) make changes to the definitions and covenants in the Existing
Credit Agreement to, among other things, conform to certain of the definitions
and covenants in the Term Loan Agreement and (C) make certain other changes to
the Existing Credit Agreement in connection with the foregoing as more fully set
forth herein.

E. In connection with the (i) entry by the Company and Holdings into the Term
Loan Agreement and (ii) Company Notes Refinancing, the Loan Parties have
requested, and the Administrative Agent and the Required Lenders have agreed, to
(A) release the security interest and Lien in favor of the Administrative Agent
in the Collateral of Holdings, (B) enter into an Intercreditor Agreement with
the Term Loan Agent, the Company, Holdings and the subsidiaries of the Company
party thereto (and in connection therewith replace the form of Intercreditor
Agreement attached as an Exhibit to the Existing Credit Agreement) and (C) enter
into an amendment and restatement of the Security Agreement with the
Administrative Agent, the Company and the subsidiaries of the Company party
thereto.

NOW THEREFORE, for and in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Loan Parties, the
Administrative Agent and Lenders hereby agree as follows:

1. Definitions. From and after the First Amendment Effective Date (defined
below), the term “Credit Agreement” (or, with respect to its use in other Loan
Documents in reference to the Existing Credit Agreement, the term “Agreement”)
as used herein, in the Existing Credit Agreement and in the other Loan
Documents, shall mean the Existing Credit Agreement as hereby amended and
modified, and as further amended, restated, modified, replaced or supplemented
from time to time as permitted thereby. This First Amendment shall constitute a
“Loan Document” for all purposes of the Credit Agreement and the other Loan
Documents.

 

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2. Amendments to Existing Credit Agreement. In reliance upon the
representations, warranties and covenants herein and effective as of the First
Amendment Effective Date:

(a) the Existing Credit Agreement is hereby amended and modified to read in its
entirety in the form as attached hereto as Annex A (the amendments and
modifications to which are shown on Annex B);

(b) Exhibit C (Form of Compliance Certificate) to the Existing Credit Agreement
is hereby deleted in its entirety and replaced with the form attached hereto as
Annex C; and

(c) Exhibit I (Form of Intercreditor Agreement) to the Existing Credit Agreement
is hereby deleted in its entirety and replaced with the form attached hereto as
Annex D.

Except as expressly set forth above in this Section 2, all schedules and
exhibits to the Existing Credit Agreement, in the forms thereof immediately
prior to the First Amendment Effective Date, will continue to be schedules and
exhibits to the Credit Agreement.

3. Reaffirmation of Loan Documents. Each Loan Party hereby acknowledges and
agrees that the Credit Agreement and the other Loan Documents, as amended and
modified hereby, to which it is a party are hereby confirmed and ratified and
shall remain in full force and effect according to their respective terms.
Except as expressly set forth in Section 5 or as may be effected pursuant to the
Intercreditor Agreement, this First Amendment shall not limit or impair any
Liens securing the Secured Obligations, which Liens are hereby ratified and
affirmed by the Loan Parties (other than Holdings).

4. Reaffirmation of Guaranty. Each Loan Guarantor hereby ratifies and affirms
its guaranty obligations under Article X of the Credit Agreement and agrees that
such Loan Guarantor continues to unconditionally and irrevocably guarantee the
prompt payment and performance of the Guaranteed Obligations thereunder.

5. Release of Holdings as Grantor. Effective as of the First Amendment Effective
Date, the Administrative Agent, at the direction of the Required Lenders party
hereto, hereby releases (a) Holdings from all of its obligations under the
Security Agreement and (b) its security interests created under the Security
Agreement in the Collateral (as defined in the Security Agreement) of Holdings.
The Required Lenders hereby authorize the Administrative Agent to enter into and
file such further documentation, and to take such further actions, as the
Administrative Agent determines is reasonably necessary to effectuate such
release (including UCC termination statements).

6. Intercreditor Agreement. On the First Amendment Effective Date, the Required
Lenders hereby authorize the Administrative Agent to enter into the
Intercreditor Agreement in the form attached as Annex D (the “Intercreditor
Agreement”).

7. Restated Security Agreement. On the First Amendment Effective Date, the
Required Lenders hereby authorize the Administrative Agent to enter into an
amendment and restatement of the Security Agreement in the form attached as
Annex E (the “Restated Security Agreement”).

 

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8. Representations and Warranties. Each Loan Party hereby represents and
warrants as follows:

(a) prior to and after giving effect to this First Amendment and any Borrowings
being made on the First Amendment Effective Date, the representations and
warranties of such Loan Party contained in Article III of the Credit Agreement,
or which are contained in any other Loan Document or other document furnished at
any time under or in connection with the Credit Agreement are true and correct
in all material respects on and as of the First Amendment Effective Date (or,
with respect to representations and warranties qualified by materiality, in all
respects), except, in each case, to the extent that such representations and
warranties specifically refer to an earlier date, in which case they are true
and correct, or true and correct in all material respects, as the case may be,
as of such earlier date;

(b) each of this First Amendment and each of the Loan Documents or amendments
thereto or restatements thereof executed by such Loan Party in connection
herewith (collectively, the “First Amendment Documents”) has been duly
authorized by all necessary organizational actions and, if required, actions by
equity holders, on the part of such Loan Party and do not (i) require any
consent or approval of, registration or filing with, or any other action by, any
Governmental Authority, except (A) such as have been obtained or made and are in
full force and effect, (B) for filings necessary to release Liens pursuant to
Section 5 of this First Amendment and (C) such approvals, authorizations or
consents the failure of which to obtain or make could not reasonably be expected
to have a Material Adverse Effect; (ii) violate (A) the certificate or articles
of incorporation or organization, by-laws, operating, management or partnership
agreement or other organizational documents of any Loan Party or any of its
Restricted Subsidiaries or (B) any material Requirement of Law applicable to any
Loan Party or any of its Restricted Subsidiaries, (iii) violate or result in a
default under the Term Loan Agreement, the Holdings Notes Indenture or any other
material indenture, agreement or instrument binding upon any Loan Party or any
of its Restricted Subsidiaries or its assets, or give rise to a right thereunder
to require any prepayment to be made by any Loan Party or any of its Restricted
Subsidiaries, and (iv) result in the creation or imposition of any Lien on any
asset of any Loan Party or any of its Restricted Subsidiaries, except Liens
created pursuant to the Loan Documents and Liens permitted under Section 6.02 of
the Credit Agreement;

(c) each of the First Amendment Documents to which each Loan Party is a party
have been duly executed and delivered by such Loan Party and constitute a legal,
valid and binding obligation of such Loan Party, enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law; and

(d) prior to and after giving effect to this First Amendment and any Borrowings
being made on the First Amendment Effective Date, no Default or Event of Default
exists.

9. Conditions to Effectiveness. This First Amendment shall be effective on the
date (the “First Amendment Effective Date”) on which each of the following
conditions has been satisfied (and with respect to deliveries of this First
Amendment and any other First Amendment Documents, each such delivery shall be
fully-executed (where applicable) and in form and substance reasonably
satisfactory to the Administrative Agent and its counsel):

(a) First Amendment. The Administrative Agent shall have received counterparts
of this First Amendment executed on behalf of the Administrative Agent, each
Loan Party and the Required Lenders.

 

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(b) Term Loan Agreement. The Term Loan Agreement shall be in form and substance
reasonably satisfactory to the Administrative Agent and the Administrative Agent
shall have received a certificate, in form and substance satisfactory to it,
signed by an authorized officer of the Borrower Representative, certifying that
(i) attached thereto are true and complete copies of the fully-executed Term
Loan Agreement and the other material documents evidencing the closing of the
transactions contemplated by the Term Loan Agreement, (ii) the closing of the
Term Loan Agreement has occurred or will occur concurrently with the First
Amendment Effective Date and in accordance with the terms of the Term Loan
Agreement, without giving effect to any modifications, amendments, consents or
waivers thereto or thereunder, in each case that are materially adverse to the
Lenders or the Administrative Agent as reasonably determined by the
Administrative Agent, with minimum gross proceeds of $350,000,000 and (iii) the
proceeds shall be used, in part, to effectuate a refinancing in full of the
Company Notes on or about the First Amendment Effective Date.

(c) Intercreditor Agreement. The Intercreditor Agreement shall have been duly
executed and delivered by the Loan Parties, the Administrative Agent and the
security agent for the Term Loan Agreement.

(d) Restated Security Agreement. The Restated Security Agreement shall have been
duly executed and delivered by the Loan Parties (other than Holdings) and the
Administrative Agent.

(e) Fees. The Administrative Agent shall have received on the First Amendment
Effective Date all expenses and costs for which invoices have been presented at
least three days prior to the First Amendment Effective Date (including the
reasonable and documented fees and expenses of legal counsel), in each case to
the extent that the Administrative Agent is entitled to reimbursement for such
fees and expenses pursuant to Section 9.03 of the Existing Credit Agreement.

(f) Representations and Warranties. The representations and warranties of each
Loan Party contained in the Credit Agreement (as amended hereby), this First
Amendment and the other Loan Documents shall be true and correct in all material
respects on and as of the First Amendment Effective Date (or, with respect to
representations and warranties qualified by materiality, in all respects)
(except for representations and warranties that expressly relate to an earlier
date in which case such representations and warranties shall be true and correct
as of such earlier date).

(g) No Defaults. No Default or Event of Default shall have occurred and be
continuing.

 

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(h) Other Documents. The Administrative Agent shall have been provided with such
documents, instruments and agreements, and the Loan Parties shall have taken
such actions, in each case as the Administrative Agent may reasonably require in
connection with this First Amendment and the transactions contemplated hereby.

10. Miscellaneous.

(a) Limitations. The amendments contemplated by Section 2 of this First
Amendment and the release in Section 5 are limited precisely as written and
shall not (a) be deemed to be a modification of any other term or condition of
the Credit Agreement or (b) except as expressly set forth herein, prejudice any
right or rights which the Lenders may now have or may have in the future under
or in connection with the Credit Agreement or any of the other documents or
instruments referred to therein.

(b) Parties in Interest. All of the terms and provisions of this First Amendment
shall bind and inure to the benefit of the parties hereto and their respective
successors and assigns.

(c) Legal Expenses. To the extent provided in Section 9.03 of the Credit
Agreement and not otherwise paid under Section 9 above, Borrowers hereby agree
to pay all reasonable and documented fees and expenses of counsel to the
Administrative Agent incurred by Administrative Agent in connection with the
preparation, negotiation and execution of this First Amendment and all related
documents.

(d) Counterparts; Execution. This First Amendment may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract. For purposes of determining compliance with
the conditions specified in this Section 9, each Lender that has signed this
First Amendment 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 written notice from such Lender prior
to the proposed First Amendment Effective Date specifying its objection thereto.
Delivery of an executed counterpart of a signature page of this First Amendment
by facsimile (or other electronic) transmission shall be effective as delivery
of a manually executed counterpart of this First Amendment.

(e) Entire Agreement. This First Amendment, the Credit 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.

(f) Headings. Section headings used herein are for convenience of reference
only, are not part of this First Amendment and shall not affect the construction
of, or be taken into consideration in interpreting, this First Amendment.

(g) Governing Law. This First Amendment shall be governed by the laws of the
State of New York, without giving effect to any conflict of law provisions (but
giving effect to section 5-1401 of the New York general obligation law and
federal laws relating to national banks).

 

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(h) No Novation. This First Amendment is given as an amendment and modification
of, and not as a payment of, the Obligations of the Borrowers and the other Loan
Parties and is not intended to constitute a novation of the Credit Agreement.
Except as expressly modified hereby, all of the indebtedness, liabilities and
obligations owing by the Borrowers and each other Loan Party under the Credit
Agreement and the other Loan Documents shall continue.

[Remainder of Page Intentionally Left Blank. Signature Pages Follow.]

 

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

 

BORROWERS: INTERLINE BRANDS, INC., a New Jersey corporation By:  

/s/ John K. Bakewell

Name:   John K. Bakewell Title:   Chief Financial Officer WILMAR FINANCIAL,
INC., a Delaware corporation By:  

/s/ John K. Bakewell

Name:   John K. Bakewell Title:   President and Chief Financial Officer JANPAK,
LLC, a West Virginia limited liability company By:  

/s/ Kenneth D. Sweder

Name:   Kenneth D. Sweder Title:   President JANPAK OF SOUTH CAROLINA, LLC, a
South Carolina limited liability company By:  

/s/ Kenneth D. Sweder

Name:   Kenneth D. Sweder Title:   President JANPAK OF TEXAS, LLC, a Texas
limited liability company By:  

/s/ Kenneth D. Sweder

Name:   Kenneth D. Sweder Title:   President

 

Signature Page to First Amendment to Credit Agreement

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IBI MERCHANDISING SERVICES, INC., a Delaware corporation By:  

/s/ Anthony Scott

Name:   Anthony Scott Title:   President and Secretary

 

Signature Page to First Amendment to Credit Agreement

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OTHER LOAN PARTIES/LOAN GUARANTORS: INTERLINE BRANDS, INC., a Delaware
corporation By:  

/s/ John K. Bakewell

Name:   John K. Bakewell Title:   Chief Financial Officer GLENWOOD ACQUISITION
LLC, a Delaware limited liability company By:  

/s/ Kenneth D. Sweder

Name:   Kenneth D. Sweder Title:   President ZIP TECHNOLOGY, LLC, a West
Virginia limited liability company By:  

/s/ Kenneth D. Sweder

Name:   Kenneth D. Sweder Title:   President

 

Signature Page to First Amendment to Credit Agreement

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AGENTS AND LENDERS: BANK OF AMERICA, N.A., as Administrative Agent and as a
Lender By:  

/s/ John M. Olsen

  Name:   John M. Olsen   Title:   Senior Vice President

 

Signature Page to First Amendment to Credit Agreement

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GOLDMAN SACHS LENDING PARTNERS LLC, as a Lender By:  

/s/ Michelle Latzoni

  Name:   Michelle Latzoni   Title:   Authorized Signatory

 

Signature Page to First Amendment to Credit Agreement

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WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender By:  

/s/ Matt Harbour

  Name:   Matt Harbour   Title:   Authorized Signatory

 

Signature Page to First Amendment to Credit Agreement

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U.S. BANK NATIONAL ASSOCIATION, as a Lender By:  

/s/ Nicole C. Manies

  Name:   Nicole C. Manies   Title:   Vice President

 

Signature Page to First Amendment to Credit Agreement

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KEYBANK NATIONAL ASSOCIATION, as a Lender By:  

/s/ Nadine M. Eames

  Name:   Nadine M. Eames   Title:   Vice President

 

Signature Page to First Amendment to Credit Agreement

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TD BANK, N.A., as a Lender By:  

/s/ Ed Kahn

  Name:   Ed Kahn   Title:   Vice-President

 

Signature Page to First Amendment to Credit Agreement

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REGIONS BANK, as a Lender By:  

/s/ Scott Martin

  Name:   Scott Martin   Title:   Asst Vice President

 

Signature Page to First Amendment to Credit Agreement

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Annex A

 

Annex A to First Amendment to Credit Agreement

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Conformed Through Amendment No. 1

 

 

 

CREDIT AGREEMENT

dated as of

September 7, 2012

among

INTERLINE BRANDS, INC.,

a New Jersey corporation,

WILMAR FINANCIAL, INC.,

a Delaware corporation

as Borrowers

The Other Loan Parties Party Hereto,

The Lenders Party Hereto,

BANK OF AMERICA, N.A.,

as Administrative Agent,

GOLDMAN SACHS LENDING PARTNERS LLC,

as Syndication Agent

and

WELLS FARGO BANK, NATIONAL ASSOCIATION,

KEYBANK NATIONAL ASSOCIATION,

U.S. BANK NATIONAL ASSOCIATION

and

TD BANK, N.A.,

as Co-Documentation Agents

 

 

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

and

GOLDMAN SACHS LENDING PARTNERS LLC,

as Joint Bookrunners and Joint Lead Arrangers

 

 

 

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TABLE OF CONTENTS

 

        

Page

    ARTICLE I      Definitions   

SECTION 1.01

  Defined Terms      1   

SECTION 1.02

  Classification of Loans and Borrowings      38   

SECTION 1.03

  Terms Generally      38   

SECTION 1.04

  Accounting Terms; GAAP      39      ARTICLE II      The Credits   

SECTION 2.01

  Commitments      39   

SECTION 2.02

  Loans and Borrowings      39   

SECTION 2.03

  Requests for Revolving Borrowings      40   

SECTION 2.04

  Protective Advances      40   

SECTION 2.05

  Swingline Loans      41   

SECTION 2.06

  Letters of Credit      42   

SECTION 2.07

  Funding of Borrowings      46   

SECTION 2.08

  Interest Elections      46   

SECTION 2.09

  Termination and Reduction of Commitments; Increase in Commitments      48   

SECTION 2.10

  Repayment of Loans; Evidence of Debt      49   

SECTION 2.11

  Prepayment of Loans      50   

SECTION 2.12

  Fees      50   

SECTION 2.13

  Interest      51   

SECTION 2.14

  Alternate Rate of Interest      52   

SECTION 2.15

  Increased Costs      52   

SECTION 2.16

  Break Funding Payments      54   

SECTION 2.17

  Taxes      54   

SECTION 2.18

  Payments Generally; Allocation of Proceeds; Sharing of Set-offs      57   

SECTION 2.19

  Mitigation Obligations; Replacement of Lenders      59   

SECTION 2.20

  Defaulting Lenders      60   

SECTION 2.21

  Returned Payments      61   

SECTION 2.22

  Limitation on Permitted Discretion.      62      ARTICLE III     
Representations and Warranties   

SECTION 3.01

  Organization; Powers      63   

SECTION 3.02

  Authorization; Enforceability      63   

SECTION 3.03

  Governmental Approvals; No Conflicts      63   

SECTION 3.04

  Financial Condition; No Material Adverse Effect      63   

SECTION 3.05

  Properties      64   

SECTION 3.06

  Litigation and Environmental Matters      64   

SECTION 3.07

  Compliance with Laws and Agreements      64   

SECTION 3.08

  Investment Company Status      65   

 

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SECTION 3.09

  Taxes      65   

SECTION 3.10

  ERISA      65   

SECTION 3.11

  Disclosure      65   

SECTION 3.12

  Material Agreements      65   

SECTION 3.13

  Solvency      66   

SECTION 3.14

  Insurance      66   

SECTION 3.15

  Capitalization and Subsidiaries      66   

SECTION 3.16

  Security Interest in Collateral      65   

SECTION 3.17

  Employment Matters      66   

SECTION 3.18

  Common Enterprise      67   

SECTION 3.19

  Permitted Indebtedness      67   

SECTION 3.20

  OFAC.      67   

SECTION 3.21

  Patriot Act, Etc.      67   

SECTION 3.22

  Margin Regulations      67      ARTICLE IV      Conditions   

SECTION 4.01

  Effective Date      68   

SECTION 4.02

  Each Credit Event      71      ARTICLE V      Affirmative Covenants   

SECTION 5.01

  Financial Statements; Borrowing Base and Other Information      72   

SECTION 5.02

  Notices of Material Events.      74   

SECTION 5.03

  Existence; Conduct of Business      75   

SECTION 5.04

  Payment of Obligations      75   

SECTION 5.05

  Maintenance of Properties      75   

SECTION 5.06

  Books and Records; Inspection Rights      75   

SECTION 5.07

  Compliance with Laws      76   

SECTION 5.08

  Use of Proceeds      76   

SECTION 5.09

  Insurance      76   

SECTION 5.10

  Appraisals      76   

SECTION 5.11

  Field Examinations      76   

SECTION 5.12

  Depository Banks      77   

SECTION 5.13

  Additional Collateral; Further Assurances      77   

SECTION 5.14

  Post-Closing Actions.      78      ARTICLE VI      Negative Covenants   

SECTION 6.01

  Indebtedness      79   

SECTION 6.02

  Liens      82   

SECTION 6.03

  Fundamental Changes      83   

SECTION 6.04

  Investments, Loans, Advances, Guarantees and Acquisitions      84   

SECTION 6.05

  Asset Sales      86   

SECTION 6.06

  Sale and Leaseback Transactions      88   

 

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SECTION 6.07

  Swap Agreements      88   

SECTION 6.08

  Restricted Payments; Certain Payments of Indebtedness      89   

SECTION 6.09

  Transactions with Affiliates      91   

SECTION 6.10

  Restrictive Agreements      91   

SECTION 6.11

  Amendment of Material Documents      92   

SECTION 6.12

  Fixed Charge Coverage Ratio      92      ARTICLE VII      Events of Default   

SECTION 7.01

  Events of Default      92   

SECTION 7.02

  Right to Cure      95      ARTICLE VIII      The Administrative Agent     
ARTICLE IX      Miscellaneous   

SECTION 9.01

  Notices.      98   

SECTION 9.02

  Waivers; Amendments      100   

SECTION 9.03

  Expenses; Indemnity; Damage Waiver      102   

SECTION 9.04

  Successors and Assigns      104   

SECTION 9.05

  Survival      107   

SECTION 9.06

  Counterparts; Integration; Effectiveness      107   

SECTION 9.07

  Severability      108   

SECTION 9.08

  Right of Setoff      108   

SECTION 9.09

  Governing Law; Jurisdiction; Consent to Service of Process      108   

SECTION 9.10

  WAIVER OF JURY TRIAL      109   

SECTION 9.11

  Headings      109   

SECTION 9.12

  Confidentiality      109   

SECTION 9.13

  Several Obligations; Nonreliance; Violation of Law      110   

SECTION 9.14

  USA PATRIOT Act      110   

SECTION 9.15

  Disclosure      110   

SECTION 9.16

  Appointment for Perfection      110   

SECTION 9.17

  Interest Rate Limitation      110   

SECTION 9.18

  No Advisory or Fiduciary Duty      111      ARTICLE X      Loan Guaranty   

SECTION 10.01

  Guaranty      111   

SECTION 10.02

  Guaranty of Payment      111   

SECTION 10.03

  No Discharge or Diminishment of Loan Guaranty      112   

SECTION 10.04

  Defenses Waived      112   

SECTION 10.05

  Rights of Subrogation      113   

 

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SECTION 10.06

   Reinstatement; Stay of Acceleration      113   

SECTION 10.07

   Information      113   

SECTION 10.08

   Taxes      113   

SECTION 10.09

   Maximum Liability      113   

SECTION 10.10

   Contribution      114   

SECTION 10.11

   Liability Cumulative      114   

SECTION 10.12

   Commodity Exchange Act Keepwell      114       ARTICLE XI       The Borrower
Representative   

SECTION 11.01

   Appointment; Nature of Relationship      115   

SECTION 11.02

   Powers      115   

SECTION 11.03

   Employment of Agents      115   

SECTION 11.04

   Notices      115   

SECTION 11.05

   Successor Borrower Representative      115   

SECTION 11.06

   Execution of Loan Documents; Borrowing Base Certificate      115   

SECTION 11.07

   Reporting      116   

SCHEDULES:

Commitment Schedule

Schedule 1.01 — Specified Properties

Schedule 2.06 — Existing Letters of Credit

Schedule 3.05 — Properties

Schedule 3.06 — Disclosed Matters

Schedule 3.12 — Material Agreements

Schedule 3.14 — Insurance

Schedule 3.15 — Capitalization and Subsidiaries

Schedule 5.14 — Post-Closing Actions

Schedule 6.01 — Existing Indebtedness

Schedule 6.02 — Existing Liens

Schedule 6.04 — Existing Investments

Schedule 6.10 — Existing Restrictions

Schedule 9.04(e) — Permitted Assignees

EXHIBITS:

Exhibit A-1 — Form of Assignment and Acceptance

Exhibit A-2 — Form of Assignment Notice

Exhibit B — Form of Borrowing Base Certificate

Exhibit C — Form of Compliance Certificate

Exhibit D — Form of Joinder Agreement

Exhibit E — Collateral Monitoring Reporting Requirements

Exhibit F — Form of Intercompany Subordinated Note

Exhibit G-1 — Form of U.S. Tax Certificate for Foreign Lenders That Are Not
Partnerships

Exhibit G-2 — Form of U.S. Tax Certificate for Foreign Participants That Are Not
Partnerships

Exhibit G-3 — Form of U.S. Tax Certificate for Foreign Participants That Are
Partnerships

Exhibit G-4 — Form of U.S. Tax Certificate for Foreign Lenders That Are
Partnerships

Exhibit H — Form of Solvency Certificate

Exhibit I — Form of Intercreditor Agreement

 

iv

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CREDIT AGREEMENT dated as of September 7, 2012 (as it may be amended or modified
from time to time, this “Agreement”), among INTERLINE BRANDS, INC., a New Jersey
corporation (the “Company”), and WILMAR FINANCIAL, INC., a Delaware corporation
(“Wilmar Financial”), as Borrowers, the other Loan Parties party hereto from
time to time, the Lenders party hereto and BANK OF AMERICA, N.A., as
Administrative Agent.

The parties hereto agree as follows:

ARTICLE I

DEFINITIONS

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

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

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

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

“Acquired EBITDA” means, with respect to any Acquired Entity or Business or any
Converted Restricted Subsidiary (any of the foregoing, a “Pro Forma Entity”) for
any period, the amount for such period of EBITDA of such Pro Forma Entity
(determined using such definitions as if references to Holdings, the Company and
any of their Subsidiaries therein were to such Pro Forma Entity and its
Subsidiaries), all as determined on a consolidated basis for such Pro Forma
Entity in accordance with GAAP.

“Acquired Entity or Business” has the meaning assigned to such term in the term
“EBITDA”.

“Acquisition” means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which any one or more
Loan Parties or Restricted Subsidiaries of Loan Parties (a) acquire all or
substantially all of the assets of any Person or any division or line of
business of any other Person, whether through purchase of assets, merger or
otherwise or (b) directly or indirectly acquire (in one transaction or as the
most recent transaction in a series of related transactions) at least a majority
(in number of votes) of the Equity Interests in a Person which has ordinary
voting power for the election of directors or other similar management personnel
of a Person (other than Equity Interests having such power only by reason of the
happening of a contingency) or a majority of the outstanding Equity Interests in
a Person.

“Acquisition Consideration” means the purchase consideration paid for any
Permitted Acquisition, whether paid in cash, properties, assumption of
Indebtedness or other obligations or otherwise and whether payable at or prior
to the consummation of such Permitted Acquisition or deferred for payment at any
time in the future, whether or not such future payment is subject to the
occurrence of any contingency, and includes any and all payments representing
“earn-outs” and other agreements to make any payment the amount of which, or the
terms of payment of which are, in any respect subject to, or contingent upon,
the revenues, income, cash flow or profits of any Person, business or operating
division.

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“Administrative Agent” means Bank of America, N.A., in its capacity as
administrative agent for the Lenders hereunder.

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

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

“Agent/Arranger Persons” has the meaning assigned to such term in Section 9.03.

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

“Agreement” has the meaning assigned to such term in the preamble of this
Agreement.

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus  1⁄2 of 1% and (c) LIBOR for a 30 day Interest
Period on such day (or if such day is not a Business Day, the immediately
preceding Business Day) plus 1%. Any change in the Alternate Base Rate due to a
change in the Prime Rate, the Federal Funds Effective Rate or LIBOR shall be
effective from and including the effective date of such change in the Prime
Rate, the Federal Funds Effective Rate or LIBOR, respectively.

“Applicable Commitment Fee Rate” means, for any day, with respect to the
commitment fees payable hereunder, the rate per annum set forth below under the
caption “Commitment Fee Rate”, based upon the Average Utilization during the
preceding calendar quarter; provided that until the end of the first fiscal
quarter after the Effective Date, the “Applicable Commitment Fee Rate” shall be
the applicable rate per annum set forth below in Category 2:

 

Average Utilization

   Commitment Fee
Rate  

Category 1

 

Average Utilization > 50%

     0.250   

Category 2

 

Average Utilization £ 50%

     0.375   

“Applicable Percentage” means, with respect to any Lender, (a) with respect to
Revolving Loans, LC Exposure or Swingline Loans, a percentage equal to a
fraction the numerator of which is such Lender’s Commitment and the denominator
of which is the Commitments of all Revolving Lenders (if the Commitments have
terminated or expired, the Applicable Percentages shall be determined based upon
such Lender’s share of the aggregate Revolving Exposures at that time); provided
that in the case of Section 2.20 when a Defaulting Lender shall exist, any such
Defaulting Lender’s Commitment shall be disregarded in the calculation and
(b) with respect to Protective Advances or with respect to the Aggregate Credit
Exposure, a percentage based upon its share of the Aggregate Credit Exposure and
the unused Commitments; provided that in the case of Section 2.20 when a
Defaulting Lender shall exist, any such Defaulting Lender’s Commitment shall be
disregarded in the calculation.

 

2

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“Applicable Rate” means, for any day, with respect to any ABR Loan or Eurodollar
Revolving Loan, as the case may be, the applicable rate per annum set forth
below under the caption “Revolver ABR Spread” or “Revolver Eurodollar Spread”,
as the case may be, based upon the Borrowers’ average daily Availability for the
most recent fiscal quarter determined as of the most recent determination date,
provided that until the delivery to the Administrative Agent, pursuant to
Section 5.01, of the Borrowers’ financial statements and Compliance Certificate
for the Borrowers’ first fiscal quarter ending after the Effective Date, the
“Applicable Rate” shall be the applicable rate per annum in the Category set
forth below for Availability as determined on the Effective Date after giving
effect to all Borrowings, the issuance (or deemed issuance) of any Letters of
Credit and the payment of all fees and expenses due hereunder on the Effective
Date:

 

Availability

   Revolver
ABR Spread      Revolver
Eurodollar Spread  

Category 1

 

> $150,000,000

     0.50         1.50   

Category 2

 

> $75,000,000 but £ $150,000,000

     0.75         1.75   

Category 3

 

£ $75,000,000

     1.00         2.00   

For purposes of the foregoing, (a) the Applicable Rate shall be determined as of
the end of each fiscal quarter of the Borrowers based upon the Borrowers’
Borrowing Base Certificates delivered pursuant to Section 5.01(e) and (b) each
change in the Applicable Rate shall be effective during the period commencing on
the first day of the calendar month following the receipt by the Administrative
Agent of the financial statements and Compliance Certificate for the fiscal
quarter or, in the case of the last fiscal quarter of each year, the calendar
year then ended pursuant to Section 5.01(a) or (b), as applicable, and ending on
the date immediately preceding the effective date of the next such change;
provided that, the Applicable Rate in Category 2 or Category 3 above determined
as of the end of such fiscal quarter shall decrease by 0.25% if the Fixed Charge
Coverage Ratio for the period of four consecutive fiscal quarters ending on the
last day of such fiscal quarter is greater than 1.50:1.00. Availability shall be
deemed to be in Category 3 at the option of the Administrative Agent or at the
request of the Required Lenders if the Borrowers fail to deliver a Borrowing
Base Certificate required to be delivered by it pursuant to Section 5.01(e),
during the period from the expiration of the time for delivery thereof until
such Borrowing Base Certificate is delivered.

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

“Assignment and Acceptance” means an assignment agreement entered into by an
assigning Lender and an assignee in the form of Exhibit A-1 or any other form
approved by the Administrative Agent and the Borrower Representative (which
approval, in the case of approvals by the Borrower Representative, (x) shall not
be unreasonably withheld or delayed and (y) shall be deemed given if no
objection is made within five Business Days of delivery of such form of
assignment to Borrower Representative).

 

3

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“Assignment Notice” mean an assignment notice entered into among an assigning
Lender, an assignee, the Administrative Agent, each Issuing Bank, the Swingline
Lender and, if applicable, the Borrower Representative in the form of Exhibit
A-2.

“Available Commitment” means, at any time, the Commitments then in effect minus
the Revolving Exposure of all Revolving Lenders at such time.

“Availability” means, at any time, an amount equal to (a) the lesser of (i) the
Commitments and (ii) the Borrowing Base, minus (b) the Aggregate Credit
Exposure.

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

“Average Utilization” means, for any period, the quotient, expressed as a
percentage, of (a) the average daily Revolving Exposure of all Lenders divided
by (b) the average daily Commitments.

“BofA” means Bank of America, N.A., a national banking association, in its
individual capacity, and its successors.

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

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

“Banking Services Reserve” means all Reserves which the Administrative Agent
from time to time establishes in its Permitted Discretion for Banking Services
then provided or outstanding.

“Bankruptcy Code” means Title 11 of the United States Code.

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

“Borrower” or “Borrowers” means, individually or collectively, the Company,
Wilmar Financial, JanPak, LLC, a West Virginia limited liability company, JanPak
of South Carolina, LLC, a South Carolina limited liability company, JanPak of
Texas, LLC, a Texas limited liability company, IBI Merchandising Services, Inc.,
a Delaware corporation, and any other Person who becomes a party to this
Agreement as a Borrower pursuant to a Joinder Agreement.

“Borrower Representative” has the meaning assigned to such term in
Section 11.01.

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

 

4

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“Borrowing Base” means, at any time, the sum of:

(a) the product of (i) 85% multiplied by (ii) the Borrowers’ Eligible Accounts
at such time, plus

(b) the lesser of (i) the product of (x) 70% multiplied by (y) the Borrowers’
Eligible Inventory, valued at the lower of cost (net of rebates and discounts)
or market value, determined in a manner consistent with practices on the
Effective Date, at such time and (ii) the product of 85% multiplied by the Net
Orderly Liquidation Value of the Borrowers’ Eligible Inventory, minus

(c) Reserves.

The Administrative Agent may, in its Permitted Discretion, adjust Reserves used
in computing the Borrowing Base, with any such changes to be effective three
(3) days after delivery of notice thereof to the Borrower Representative and the
Lenders. The Borrowing Base at any time shall be determined by reference to the
most recent Borrowing Base Certificate delivered to the Administrative Agent
pursuant to Section 5.01(e) of this Agreement.

“Borrowing Base Certificate” means a certificate, signed and certified as
accurate and complete by a Financial Officer of the Borrower Representative, in
substantially the form of Exhibit B (or another form as may, from time to time,
be mutually agreed by the Borrower Representative and the Administrative Agent),
setting forth the Borrower Representative’s calculation of the Borrowing Base.

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

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed; provided that, when used in connection with a Eurodollar Loan,
the term “Business Day” shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.

“Buyers Access” means Buyers Access LLC, a Delaware limited liability company.

“Capital Expenditures” means, without duplication, any expenditure or commitment
to expend money for any purchase or other acquisition of any asset which would
be classified as a fixed or capital asset on a consolidated balance sheet of
Holdings and its Restricted Subsidiaries prepared in accordance with GAAP, but
excluding (i) any such expenditure made to restore, replace or rebuild property
to the condition of such property immediately prior to any damage, loss,
destruction or condemnation of such property, to the extent such expenditure is
made with insurance proceeds, condemnation awards or damage recovery proceeds
relating to any such damage, loss, destruction or condemnation, (ii) any such
expenditure (or commitment to expend money) to the extent such expenditure is or
will be made with proceeds of the sale or trade of an asset similar to the asset
being purchased or otherwise acquired, (iii) any such expenditure (or commitment
to expend money) to the extent such expenditure is or will be part of a
Permitted Acquisition and (iv) any such expenditure (or commitment to expend
money) to the extent such expenditure does not exceed an amount equal to the net
proceeds of an issuance of Equity Interests by Holdings (provided that (x) the
Company has notified the Administrative Agent at or prior to the time of such
issuance that the Company and/or one or more of its Restricted Subsidiaries
intended to utilize all or a portion of such proceeds to fund such expenditure
(and describing the contemplated use and estimated amount of such expenditure)
and (y) such expenditure is made (or a commitment to make such expenditure is
entered into) within ninety days of the issuance of such Equity Interests).

 

5

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“Capital Lease Obligations” of any Person means the obligations of such Person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP, and the amount of such obligations
shall be the capitalized amount thereof determined in accordance with GAAP;
provided, that the term “Capital Lease Obligations” shall not include any
obligations that are excluded from the definition of “Indebtedness” pursuant to
the proviso thereto.

“Captive Insurance Subsidiary” means any Subsidiary of the Company that is
subject to regulation as an insurance company (or any Subsidiary thereof).

“Cash Pooling Arrangements” means a deposit account arrangement among a single
depository institution and one or more Foreign Subsidiaries of the Company
involving the pooling of cash deposits and overdrafts in respect of one or more
deposit accounts (each located outside of the United States and any States and
territories thereof) with such institution by such Foreign Subsidiaries for cash
management purposes.

“Change in Control” means (a)(i) at any time prior to a Qualifying IPO, the
acquisition of ownership, directly or indirectly, beneficially or of record, by
any Person or group (within the meaning of the Securities Exchange Act of 1934
and the rules of the SEC thereunder as in effect on the date hereof), other than
one or more Permitted Holders, of Equity Interests representing more than 50% of
the aggregate ordinary voting power represented by the issued and outstanding
Equity Interests of Holdings and (ii) at any time on or after a Qualifying IPO,
the acquisition of ownership, directly or indirectly, beneficially or of record,
by any Person or group (within the meaning of the Securities Exchange Act of
1934 and the rules of the SEC thereunder as in effect on the date hereof) but
excluding any employee benefit plan and/or Person acting as the trustee, agent
or other fiduciary or administrator therefor, other than one or more Permitted
Holders, of Equity Interests representing more than the greater of (A) 35.0% of
the total voting power of all of the outstanding voting stock of Holdings and
(B) the percentage of the total voting power of all of the outstanding voting
stock of Holdings owned, directly or indirectly, by the Permitted Holders;
(b) Holdings shall cease to own, free and clear of all Liens or other
encumbrances (other than Liens permitted under clause (a) or (e) of the
definition of Permitted Encumbrances and under Section 6.02(a) and (l)), 100% of
the outstanding voting Equity Interests of the Company on a fully diluted basis;
(c) occupation of a majority of the seats (other than vacant seats) on the board
of directors of Holdings by Persons who were neither (i) nominated by the board
of directors of Holdings nor (ii) appointed by directors so nominated; (d) the
occurrence of a “Change of Control”, as defined in any Term Loan Document or any
Holdings Notes Document; or (e) the Company shall cease to own, directly or
indirectly and free and clear of all Liens or other encumbrances (other than
Liens permitted under clause (a) of the definition of Permitted Encumbrances and
under Section 6.02(a) and (l)), 100% of the outstanding voting Equity Interests
of each other Restricted Subsidiary that is designated as a Borrower, on a fully
diluted basis, unless prior to or concurrently with such cessation, such
Restricted Subsidiary shall have ceased to be a Loan Party in accordance
herewith.

“Change in Law” means the occurrence, after the date of this Agreement (or with
respect to any Lender, if later, the date on which such Lender becomes a
Lender), 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; provided however, that notwithstanding anything herein to the
contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, regulations, guidelines or directives thereunder or issued
in connection therewith and (y) all requests, rules, guidelines or directives
promulgated by the Bank for International Settlements, the Basel Committee on
Banking

 

6

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Supervision (or any successor or similar authority) or the United States or
foreign regulatory authorities, in each case pursuant to Basel III shall in each
case be deemed to be a “Change in Law”, regardless of the date enacted, adopted
or issued.

“Change in Tax Law” means the enactment, promulgation, execution or ratification
of, or any change in or amendment to any law (including the Code), treaty,
regulation or rule (or in the official interpretation of any law, treaty,
regulation or rule by any Governmental Authority (including a court)) relating
to U.S. income taxation.

“Charges” has the meaning assigned to such term in Section 9.17.

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

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

“Co-Documentation Agents” means Wells Fargo Bank, National Association, U.S.
Bank National Association, KeyBank National Association and TD Bank, N.A.

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

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

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

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

“Commercial LC Exposure” means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding commercial Letters of Credit at such time and
(b) the aggregate amount of all LC Disbursements relating to commercial Letters
of Credit that have not yet been reimbursed by or on behalf of the Borrowers at
such time. The Commercial LC Exposure of any Revolving Lender at any time shall
be its Applicable Percentage of the total Commercial LC Exposure at such time.

“Commitment” means, with respect to each Lender, the commitment, if any, of such
Lender to make Revolving Loans and to acquire participations in Protective
Advances, Letters of Credit and Swingline Loans hereunder, expressed as an
amount representing the maximum possible aggregate amount of such Lender’s
Credit Exposure hereunder, as such commitment may be reduced or increased from
time to time pursuant to (a) Section 2.09 and (b) assignments by or to such
Lender pursuant to Section 9.04. The initial amount of each Lender’s Commitment
is set forth on the Commitment Schedule, or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Commitment, as applicable.
“Commitments” means the aggregate of each Lender’s Commitment hereunder. The
initial amount of the Commitments is $275,000,000.

“Commitment Letter” means the Project Isabelle Commitment Letter dated as of
May 29, 2012 from the Lead Arrangers and BofA to MergerSub, together with all
exhibits thereto.

 

7

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

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et
seq.).

“Company” has the meaning assigned to such term in the preamble of this
Agreement.

“Company Disclosure Letter” means the disclosure letter delivered to Newco by
Holdings concurrently with the execution and delivery of the Merger Agreement
(as in effect on May 29, 2012).

“Company Material Adverse Effect” has the meaning assigned to such term in the
Commitment Letter.

“Company Notes” means the notes due 2018 issued by the Company pursuant to the
Company Notes Indenture and the Indebtedness represented thereby.

“Company Notes Indenture” means the Indenture, dated as of November 16, 2010,
among Holdings, the Company, the Subsidiaries listed therein and Wells Fargo
Bank, National Association, as trustee, in respect of the Company Notes, as
amended by that certain First Supplemental Indenture dated June 19, 2012, by
that certain Second Supplemental Indenture dated June 27, 2012 (the “Second
Supplemental Indenture”), by that certain Third Supplemental Indenture dated
December 11, 2012, by that certain Fourth Supplemental Indenture dated April 4,
2013, and by that certain Fifth Supplemental Indenture dated March 12, 2014.

“Company SEC Documents” has the meaning assigned to such term in the Merger
Agreement.

“Compliance Certificate” has the meaning assigned to such term in
Section 5.01(c).

“Connection Taxes” means, with respect to any Recipient, Taxes imposed as a
result of any present or former connection between such Recipient and the
jurisdiction imposing such Taxes (other than connections arising from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Loan Document, or sold or assigned any interest in any Loan or Loan Document).

“Consolidated Total Assets” means, as of any date of determination, the amount
that would, in conformity with GAAP, be set forth opposite the caption “total
assets” (or any like caption) on a consolidated balance sheet of the Company and
its Restricted Subsidiaries as of the last day of the most recently ended fiscal
period for which financial statements have been delivered pursuant
Section 5.01(a) or Section 5.01(b), as applicable.

“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.

“Converted Restricted Subsidiary” has the meaning assigned to such term in the
definition of “EBITDA”.

“Converted Unrestricted Subsidiary” has the meaning assigned to such term in the
definition of “EBITDA”.

 

8

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“Covenant Trigger Period” means (a) each period commencing on any day that an
Event of Default occurs, and continuing until such Event of Default has been
cured or waived and (b) each period commencing on any day that Availability is
less than the greater of (i) $25,000,000 and (ii) 10% of the Commitments, and
continuing until, during the preceding 30 consecutive days, Availability has at
all times exceeded the greater of (A) $25,000,000 and (B) 10% of the
Commitments.

“Credit Exposure” means, as to any Lender at any time, the sum of (a) such
Lender’s Revolving Exposure at such time, and (b) an amount equal to its
Applicable Percentage, if any, of the aggregate principal amount of Protective
Advances outstanding at such time.

“Cure Period” has the meaning assigned to such term in Section 7.02(a).

“Cure Right” has the meaning assigned to such term in Section 7.02(a).

“Debt Reserve” means the aggregate amount of reserves established by the
Administrative Agent with respect to Indebtedness of Holdings and its Restricted
Subsidiaries incurred under Sections 6.01(c) and (t) that matures or has a
scheduled due date before the Maturity Date, such reserves to be in an amount
equal to the aggregate outstanding principal amount of all such Indebtedness
that is scheduled to be paid within 60 days of such maturity or scheduled due
date, as the case may be, to the extent (and only with respect to the portion)
exceeding $50,000,000 and excluding payments relating to (i) a change of
control, (ii) an “applicable high yield discount obligation” catch-up payment,
(iii) amortization of Indebtedness equal to or less than 1.0% per year of the
original principal amount of such Indebtedness, and (iv) redemption and
defeasance provisions customary for the relevant type of Indebtedness.

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

“Defaulting Lender” means any Lender, as determined by the Administrative Agent,
that has (a) failed to fund any portion of its Loans or participations in
Letters of Credit or Swingline Loans within three Business Days of the date
required to be funded by it hereunder, unless the conditions to such Loans or
participations in Letters of Credit or Swingline Loans are the subject of a good
faith dispute, (b) notified any Borrower, the Administrative Agent, any Issuing
Bank, the Swingline Lender or any Lender in writing that it does not intend to
comply with any of its funding obligations under this Agreement or has made a
public statement to the effect that it does not intend to comply with its
funding obligations under this Agreement or under other agreements generally in
which it commits to extend credit, (c) failed, within three Business Days after
request by the Administrative Agent, to confirm that it will comply with the
terms of this Agreement relating to its obligations to fund prospective Loans
and participations in then outstanding Letters of Credit and Swingline Loans,
(d) otherwise failed to pay over to the Administrative Agent or any other Lender
any other amount required to be paid by it hereunder within three Business Days
of the date when due, unless the subject of a good faith dispute, or
(e) (i) become or is insolvent or, at the discretion of the Administrative
Agent, has a parent company that has become or is insolvent or (ii) become the
subject of a bankruptcy or insolvency proceeding, or has had a receiver,
conservator, trustee or custodian appointed for it, or has had a similar Person
charged with the reorganization or liquidation of its business or assets,
including the Federal Deposit Insurance Corporation, or has taken any action in
furtherance of, or indicating its consent to, approval of or acquiescence in any
such proceeding or appointment or, at the discretion of the Administrative
Agent, has a parent company that has become the subject of a bankruptcy or
insolvency proceeding, or has had a receiver, conservator, trustee or custodian
appointed for it or has had a similar Person charged with the reorganization or
liquidation of its business or assets, including the Federal Deposit Insurance
Corporation, or has taken any action in furtherance of, or indicating its
consent to, approval of or acquiescence in any such proceeding or appointment;
provided that a Lender shall not be a Defaulting Lender solely by virtue of the
ownership or acquisition of any equity interest in that Lender or any direct or
indirect parent company by a Governmental Authority.

 

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“Designated Non-Cash Consideration” means the fair market value of non-cash
consideration received by any Borrower or a Restricted Subsidiary in connection
with a disposition to which the proviso to Section 6.05 applies that is
designated as Designated Non-Cash Consideration pursuant to a certificate of a
Borrower Representative, setting forth the basis of such valuation (which amount
will be reduced by the fair market value of the portion of the non-cash
consideration converted to cash within 180 days following the consummation of
the applicable disposition).

“Dilution Factors” shall mean, without duplication, with respect to any period,
the aggregate amount of all deductions, credit memos, returns, adjustments,
allowances, bad debt write-offs and other non-cash credits which are recorded to
reduce accounts receivable of the Borrowers in a manner consistent with current
and historical accounting practices of the Borrowers.

“Dilution Ratio” shall mean, at any date, the amount (expressed as a percentage)
equal to (a) the aggregate amount of the applicable Dilution Factors for the
twelve (12) most recently ended fiscal months divided by (b) total gross sales
of the Borrowers for the twelve (12) most recently ended fiscal months.

“Dilution Reserve” shall mean, at any date, the greater of (a) zero and (b) the
product of the applicable Dilution Ratio minus 5% multiplied by the Eligible
Accounts on such date.

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

“Disposed EBITDA” means, with respect to any Sold Entity or Business or any
Converted Unrestricted Subsidiary for any period, the amount for such period of
EBITDA of such Sold Entity or Business or Converted Unrestricted Subsidiary
(determined as if references to Holdings, the Company and the Restricted
Subsidiaries in the definition of EBITDA were references to such Sold Entity or
Business or Converted Unrestricted Subsidiary and its Subsidiaries), all as
determined on a consolidated basis for such Sold Entity or Business or Converted
Unrestricted Subsidiary.

“Disqualified Stock” means, with respect to any Person, any Equity Interest
which by its terms (or by the terms of any security into which it is convertible
or for which it is exchangeable at the option of the holder) or upon the
happening of any event: (a) matures or is mandatorily redeemable (other than
redeemable only for Equity Interests of such Person which is not itself
Disqualified Stock) pursuant to a sinking fund obligation or otherwise, (b) is
convertible or exchangeable at the option of the holder for Indebtedness or
Disqualified Stock or (c) is mandatorily redeemable or must be purchased upon
the occurrence of certain events or otherwise, in whole or in part, in each
case, on or prior to ninety-one (91) days after the Maturity Date, except, in
the case of clauses (a) and (b), if as a result of a change of control or asset
sale, so long as any rights of the holders thereof upon the occurrence of such a
change of control or asset sale event are subject to the prior payment in full
of all Obligations.

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

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

“Domestic Subsidiary” means a Subsidiary that is incorporated or formed under
the laws of the United States of America, any state thereof or the District of
Columbia.

 

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“Dominion Trigger Period” means (a) each period commencing on any day that an
Event of Default under Section 7.01(a), Section 7.01(b), Section 7.01(h) or
Section 7.01(i) occurs or, at the election of the Administrative Agent or the
Required Lenders, any other Event of Default occurs, and continuing until such
Event of Default has been cured or waived and (b) each period commencing on any
day that Availability is less than the greater of (i) $25,000,000 and (ii) 10%
of the Commitments, and continuing until, during the preceding 30 consecutive
days, Availability has at all times exceeded the greater of (A) $25,000,000 and
(B) 10% of the Commitments.

“EBITDA” means, for any period, Net Income for such period plus (a) without
duplication and to the extent deducted in determining Net Income for such
period, the sum of (i) Interest Expense for such period, (ii) provision for
income taxes for such period, (iii) all amounts attributable to depreciation and
amortization expense for such period, (iv) any extraordinary charges for such
period, (v) any impairment charge or asset write-off related to intangible
assets (including goodwill), long-lived assets, and investments in debt and
equity securities pursuant to GAAP for such period, (vi) all losses from
(A) asset sales (other than asset sales in the ordinary course of business)
during such period and (B) investments recorded using the equity method during
such period, (vii) stock-based awards compensation expense for such period,
(viii) any other non-cash charges during such period (but excluding any non-cash
charge in respect of an item that was included in Net Income (other than accrual
of revenue in the ordinary course of business) in a prior period), (ix) the
amount, if any, of management, monitoring and consulting fees and expenses paid
to the Sponsors for such period, not to exceed $5,000,000 in any four quarter
period, (x) the amount, if any, of transaction fees and related expenses paid to
the Sponsors in connection with acquisitions, dispositions, recapitalizations,
refinancings and extraordinary transactions for such period, not to exceed (net
of reimbursable expenses) 1% of the transaction value for any such transaction,
(xi)(A) restructuring and other non-recurring expenses incurred during such
period, including severance costs, costs associated with office or plant
openings or closings and consolidation or relocation fees for such period and
(B) any up-front fees, transaction costs, commissions, expenses, premiums or
charges related to the issuance of Equity Interests, any investment permitted
hereunder (other than a Specified Investment), any permitted asset sale, or any
recapitalization, incurrence, repayment, amendment or modification of
Indebtedness permitted hereunder (in each case whether or not consummated but
excluding any of the foregoing paid or payable to the Sponsors under clause
(ix) or (x)) during such period; provided that in no event shall the sum of the
amounts under (A) and (B) of this clause (xi) and the adjustments made in
clause (C)(2) below exceed 10% of EBITDA for such period (without giving effect
to the adjustments provided in this clause (xi) and in clause (C)(2)),
(xii) costs and expenses paid by the Borrowers in connection with the
Transactions and (xiii) any up-front fees, transaction costs, commissions,
expenses or charges related to any Permitted Acquisition or other Specified
Investment (in each case whether or not consummated but excluding any of the
foregoing paid or payable to the Sponsors under clause (ix) or (x)) during such
period, minus (b) without duplication and to the extent included in Net Income,
(i) any cash payments made during such period in respect of non-cash charges
described in clause (a)(viii) taken in a prior period, (ii) any extraordinary
gains for such period, (iii) any non-cash items of income for such period
(excluding any non-cash gain to the extent it represents the reversal of an
accrual or reserve for a potential cash item that reduced Net Income in any
prior period), (iv) all gains from (A) asset sales (other than asset sales in
the ordinary course of business) during such period and (B) investments recorded
using the equity method during such period, all calculated for Holdings and its
Restricted Subsidiaries on a consolidated basis in accordance with GAAP;
provided that, to the extent included in Net Income,

(A) there shall be excluded in determining EBITDA unrealized currency
translation gains and losses related to currency remeasurements of Indebtedness
or intercompany balances (including the net loss or gain resulting from Swap
Agreements for currency exchange risk),

 

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(B) there shall be excluded in determining EBITDA for any period any adjustments
for unrealized gain or loss resulting from the application of Statement of
Financial Accounting Standards No. 133,

(C) there shall be included in determining EBITDA for any period, without
duplication, (1) the Acquired EBITDA of any Person, property, business or asset
acquired by any of Holdings, the Company or any Restricted Subsidiary since the
beginning of such period to the extent not subsequently sold, transferred,
abandoned or otherwise disposed by Holdings, the Company or such Restricted
Subsidiary (each such Person, property, business or asset acquired and not
subsequently so disposed of, an “Acquired Entity or Business”) and the Acquired
EBITDA of any Unrestricted Subsidiary that is converted into a Restricted
Subsidiary since the beginning of such period (each, a “Converted Restricted
Subsidiary”), based on the actual Acquired EBITDA of such Acquired Entity or
Business or Converted Restricted Subsidiary for such period (including the
portion thereof occurring prior to such acquisition or conversion), and (2) an
adjustment in respect of each Acquired Entity or Business equal to the amount of
the Pro Forma Adjustment with respect to such Acquired Entity or Business
acquired since the beginning of such period (including the portion thereof
occurring prior to such acquisition) as specified in a Pro Forma Adjustment
Certificate and delivered to the Lenders and the Administrative Agent; provided
that in no event shall the sum of the adjustments under this clause (C)(2) and
the amounts under (A) and (B) of clause (xi) above exceed 10% of EBITDA for such
period (without giving effect to the adjustments provided in clause (xi) and
this clause (C)(2)), and

(D) there shall be excluded in determining EBITDA for any period the Disposed
EBITDA of any Person, property, business or asset (other than an Unrestricted
Subsidiary) sold, transferred, abandoned or otherwise disposed of, closed or
classified as discontinued operations by any of Holdings, the Company or any
Restricted Subsidiary since the beginning of such period (each such Person,
property, business or asset so sold or disposed of, a “Sold Entity or
Business”), and the Disposed EBITDA of any Restricted Subsidiary that is
converted into an Unrestricted Subsidiary during such period (each, a
“Converted Unrestricted Subsidiary”) based on the actual Disposed EBITDA of such
Sold Entity or Business or Converted Unrestricted Subsidiary for such period
(including the portion thereof occurring prior to such sale, transfer or
disposition or conversion).

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

“Eligible Accounts” means each Account of a Borrower that, at the time of
creation and at all times thereafter, is not ineligible for inclusion in the
calculation of the Borrowing Base pursuant to any of clauses (a) through
(x) below. Eligible Accounts shall not include any Account:

(a) which is not subject to a first priority perfected security interest in
favor of the Administrative Agent;

(b) which is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent, (ii) a Permitted Encumbrance described in clause (a) of
the definition thereof, provided that, eligibility of Accounts shall be reduced
by the amount of such Permitted Encumbrance and (iii) any Lien permitted under
Section 6.02(l);

(c) with respect to which (i) the scheduled due date is more than 120 days after
the original invoice date, (ii) is unpaid more than 90 days after the date of
the original invoice therefor or more than 60 days after the original due date,
or (iii) has been written off the books of the Borrowers or otherwise

 

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designated as uncollectible (in determining the aggregate amount from the same
Account Debtor that is unpaid hereunder there shall be excluded the amount of
any net credit balances relating to Accounts due from an Account Debtor which
are unpaid more than 90 days from the date of invoice or more than 60 days from
the due date);

(d) which is owing by an Account Debtor for which more than 50% of the Accounts
owing from such Account Debtor and its Affiliates are ineligible pursuant to
clause (c) above;

(e) which is owing by an Account Debtor to the extent the aggregate amount of
Accounts owing from such Account Debtor and its Affiliates to the Borrowers
exceeds 15% (or such higher percentage as the Administrative Agent may establish
for such Account Debtor from time to time but not to exceed 20%) of the
aggregate amount of Eligible Accounts, in each case, only to the extent of such
excess;

(f) with respect to which any covenant, representation, or warranty relating to
such Account contained in this Agreement or in the Security Agreement has been
breached or is not true;

(g) which (i) does not arise from the sale of goods or performance of services
in the ordinary course of business, (ii) is not evidenced by (x) an invoice or
(y) other documentation reasonably satisfactory to the Administrative Agent
which in either case has been sent to the Account Debtor, (iii) represents a
progress billing, (iv) is contingent upon the Borrowers’ completion of any
further performance, (v) represents a sale on a bill-and-hold, guaranteed sale,
sale-and-return, sale on approval, consignment, cash-on-delivery or any other
repurchase or return basis (except with respect to up to $1,000,000 of such
Accounts in the aggregate) or (vi) relates to payments of interest;

(h) for which the goods giving rise to such Account have not been shipped to the
Account Debtor or for which the services giving rise to such Account have not
been performed by such Borrower or if such Account was invoiced more than once;

(i) with respect to which any check or other instrument of payment has been
returned uncollected for any reason;

(j) which is owed by an Account Debtor which has (i) applied for, suffered, or
consented to the appointment of any receiver, custodian, trustee, or liquidator
of its assets, (ii) has had possession of all or a material part of its property
taken by any receiver, custodian, trustee or liquidator, unless the payment of
Accounts owed by such Account Debtor is secured by assets of, or guaranteed by,
in either case in a manner satisfactory to the Administrative Agent, a Person
that is acceptable to the Administrative Agent, (iii) filed, or had filed
against it, any request or petition for liquidation, reorganization,
arrangement, adjustment of debts, adjudication as bankrupt, winding-up, or
voluntary or involuntary case under any state or federal bankruptcy laws (other
than post-petition accounts payable of an Account Debtor that is a
debtor-in-possession under the Bankruptcy Code and reasonably acceptable to the
Administrative Agent), (iv) has admitted in writing its inability, or is
generally unable to, pay its debts as they become due, (v) become insolvent, or
(vi) ceased operation of its business;

(k) which is owed by any Account Debtor which has sold all or a substantially
all of its assets;

(l) which is owed by an Account Debtor which (i) does not maintain its chief
executive office in the U.S. (including any state, commonwealth or territory
thereof that has adopted Revised Article 9 of the Uniform Commercial Code) or
Canada or (ii) is not organized under applicable law of the U.S., any state of
the U.S., any commonwealth or territory of the U.S. (in each case that has
adopted

 

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Revised Article 9 of the Uniform Commercial Code), Canada, or any province of
Canada unless, in either case, such Account is backed by a letter of credit
acceptable to the Administrative Agent in its Permitted Discretion so long as
(A) the Administrative Agent has “control” (as defined in the UCC) over such
letter of credit (and if such letter of credit is in tangible form, such letter
of credit is in the possession of the Administrative Agent) and (B) such letter
of credit is directly drawable by the Administrative Agent);

(m) which is owed in any currency other than dollars;

(n) which is owed by (i) the government (or any department, agency, public
corporation, or instrumentality thereof) of any country other than the U.S.
unless such Account is backed by a letter of credit acceptable to the
Administrative Agent in its Permitted Discretion so long as (A) the
Administrative Agent has “control” (as defined in the UCC) over such letter of
credit (and if such letter of credit is in tangible form, such letter of credit
is in the possession of the Administrative Agent) and (B) such letter of credit
is directly drawable by the Administrative Agent), or (ii) the government of the
U.S., or any department, agency, public corporation, or instrumentality thereof,
unless the Federal Assignment of Claims Act of 1940, as amended (31 U.S.C. §
3727 et seq. and 41 U.S.C. § 15 et seq.), and any other steps necessary to
perfect the Lien of the Administrative Agent in such Account have been complied
with to the Administrative Agent’s satisfaction;

(o) which is owed by any Affiliate, employee, officer, director, agent or
stockholder of any Loan Party; provided that portfolio companies of the Sponsors
that do business with a Borrower in the ordinary course of business will not be
treated as Affiliates for purposes of this clause (o);

(p) which is owed by an Account Debtor or any Affiliate of such Account Debtor
to which any Loan Party is indebted, but only to the extent of such indebtedness
or is subject to any security, deposit, progress payment, retainage or other
similar advance made by or for the benefit of an Account Debtor, in each case to
the extent thereof;

(q) which is subject to any counterclaim, deduction, defense, setoff or dispute
but only to the extent of any such counterclaim, deduction, defense, setoff or
dispute unless (i) the Administrative Agent, in its Permitted Discretion, has
established appropriate Reserves and determines to include such Account as an
Eligible Account or (ii) such Account Debtor has entered into an agreement
reasonably acceptable to the Administrative Agent to waive such rights;

(r) which is evidenced by any promissory note, chattel paper, or instrument;

(s) which is owed by an Account Debtor located in any jurisdiction which
requires filing of a “Notice of Business Activities Report” or other similar
report in order to permit such Borrower to seek judicial enforcement in such
jurisdiction of payment of such Account, unless such Borrower has filed such
report or qualified to do business in such jurisdiction;

(t) with respect to which such Borrower has made any agreement with the Account
Debtor for any reduction thereof, other than discounts and adjustments given in
the ordinary course of business, or any Account which was partially paid and
such Borrower created a new receivable for the unpaid portion of such Account;

(u) which does not comply in all material respects with the requirements of all
applicable laws and regulations, whether Federal, state or local, including
without limitation the Federal Consumer Credit Protection Act, the Federal Truth
in Lending Act and Regulation Z of the Board;

 

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(v) which is for goods that have been sold under a purchase order or pursuant to
the terms of a contract or other agreement or understanding (written or oral)
that indicates or purports that any Person other than such Borrower has or has
had an ownership interest in such goods, or which indicates any party other than
such Borrower as payee or remittance party;

(w) which was created on cash on delivery terms; or

(x) which the Administrative Agent determines may not be paid by reason of the
Account Debtor’s inability to pay or which the Administrative Agent otherwise
determines is unacceptable for any reason whatsoever in the exercise of its
Permitted Discretion.

In the event that an Account which was previously an Eligible Account ceases to
be an Eligible Account hereunder (other than by virtue of clause (x) above),
such Borrower or the Borrower Representative shall notify the Administrative
Agent thereof on and at the time of submission to the Administrative Agent of
the next Borrowing Base Certificate. In determining the amount of an Eligible
Account, the face amount of an Account may, in the Administrative Agent’s
Permitted Discretion, 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 such Borrower may be obligated to rebate to an Account Debtor 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 such Borrower to reduce the amount of such Account.

“Eligible Inventory” means all Inventory of a Borrower that, at the time of
purchase and at all times thereafter was not ineligible for inclusion in the
calculation of the Borrowing Base pursuant to any of clauses (a) through
(p) below. Eligible Inventory shall not include any Inventory:

(a) which is not subject to a first priority perfected Lien in favor of the
Administrative Agent;

(b) which is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent, (ii) a Permitted Encumbrance described in clause (a) or
(b) of the definition thereof, provided that, (A) with respect to any such
Permitted Encumbrance described in clause (a) of the definition thereof,
eligibility of Inventory shall be reduced by the amount of such Permitted
Encumbrance and (B) with respect to any such Permitted Encumbrance described in
clause (b) of the definition thereof, the requirements of clause (h) or
(i) below are satisfied and (iii) any Lien permitted under Section 6.02(l);

(c) which is, in the Administrative Agent’s Permitted Discretion, slow moving or
obsolete (unless taken into account in the most recent Inventory Appraisal and
the value of Eligible Inventory in the Borrowing Base is being determined by
reference to the Net Orderly Liquidation Value thereof), unmerchantable,
defective, used, unfit for sale, not salable at prices approximating at least
the cost of such Inventory in the ordinary course of business or unacceptable
due to age, type, category and/or quantity;

(d) with respect to which any covenant, representation, or warranty contained in
this Agreement or the Security Agreement has been breached or is not true in any
material respect and which does not conform in any material respect to any
applicable standards imposed by any Governmental Authority;

(e) in which any Person other than such Borrower shall (i) have any direct or
indirect ownership, interest or title to such Inventory or (ii) be indicated on
any purchase order or invoice with respect to such Inventory as having or
purporting to have an interest therein;

 

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(f) which is not finished goods or which constitutes work-in-process, raw
materials, spare or replacement parts, subassemblies, packaging and shipping
material, manufacturing supplies, samples, prototypes, displays or display
items, bill-and-hold goods, goods that are returned or marked for return,
repossessed goods, defective or damaged goods, goods held on consignment, or
goods which are not of a type held for sale in the ordinary course of business;

(g) which is not located in the U.S. (including any state, commonwealth or
territory thereof that has adopted Revised Article 9 of the Uniform Commercial
Code) or is in transit with a common carrier from vendors and suppliers;

(h) which is located in any location leased by such Borrower unless (i) the
lessor has delivered to the Administrative Agent a Collateral Access Agreement
or (ii) a Rent Reserve has been established by the Administrative Agent;

(i) which is (i) located in any third party warehouse or is in the possession of
a bailee (other than a third party processor), unless (A) such warehouseman or
bailee has delivered to the Administrative Agent a Collateral Access Agreement
and such other documentation as the Administrative Agent may require or (B) an
appropriate Reserve has been established by the Administrative Agent in its
Permitted Discretion, and (ii) not evidenced by a Document;

(j) which is being processed offsite at a third party location or outside
processor, or is in-transit to or from said third party location or outside
processor;

(k) which is the subject of a consignment by such Borrower as consignor, unless
(i) a protective UCC-1 financing statement has been properly filed against the
consignee (as assigned to the Administrative Agent), and (ii) there is a written
agreement acknowledging that such Inventory is held on consignment, that such
Borrower retains title to such Inventory, that no Lien arising by, through or
under such consignee has attached or will attach to such Inventory and requiring
consignee to segregate the consigned Inventory from the consignee’s other
personal or movable property and having other terms consistent with such
Borrower’s past practices for consigned Inventory; provided that, Inventory at a
vendor managed location under the control of a Borrower and subject to a written
agreement in which such vendor acknowledges such Borrower’s title to such
Inventory shall not be considered the subject of a consignment;

(l) which is perishable;

(m) which contains or bears any intellectual property rights licensed to the
Borrowers unless the Administrative Agent is satisfied in its Permitted
Discretion that it may sell or otherwise dispose of such Inventory without
(i) infringing the rights of such licensor, (ii) violating any contract with
such licensor, or (iii) incurring any liability with respect to payment of
royalties other than royalties incurred pursuant to sale of such Inventory under
the current licensing agreement;

(n) which is not reflected in a current perpetual inventory report of the
Borrowers;

(o) for which reclamation rights have been asserted by the seller; or

(p) which the Administrative Agent otherwise determines is unacceptable for any
reason whatsoever in the exercise of its Permitted Discretion.

In the event that Inventory which was previously Eligible Inventory ceases to be
Eligible Inventory hereunder (other than pursuant to clause (p) above), such
Borrower or the Borrower Representative shall notify the Administrative Agent
thereof on and at the time of submission to the Administrative Agent of the next
Borrowing Base Certificate.

 

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

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of any Borrower or any Restricted Subsidiary directly
or indirectly resulting from or based upon (a) violation of any Environmental
Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

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

“Equity Contribution” means the cash equity contributions (including any
roll-over equity contributions from minority investors) in the form of common
equity (unless otherwise agreed in the discretion of the Lead Arrangers) made
directly or indirectly by the Permitted Holders to Newco in an aggregate amount
equal to at least 30% of the pro forma capitalization of Holdings after the
consummation of the Merger.

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

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

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

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

 

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

“Event of Default” has the meaning assigned to such term in Section 7.01.

“Excluded Swap Obligation” means, with respect to any Loan Guarantor, any Hedge
Obligation if, and to the extent that, all or a portion of the Loan Guaranty of
such Loan Guarantor of, or the grant by such Loan Guarantor of a Lien to secure,
such Hedge Obligation (or any Loan Guaranty thereof) is or becomes illegal under
the Commodity Exchange Act or any rule, regulation or order of the Commodity
Futures Trading Commission (or the application or official interpretation of any
thereof) by virtue of such Loan Guarantor’s failure for any reason to constitute
an “eligible contract participant” (as defined in the Commodity Exchange Act and
the regulations thereunder) at the time the Loan Guaranty of such Loan Guarantor
or the grant of such security interest becomes effective with respect to such
Hedge Obligation (which for the avoidance of doubt shall be determined after
giving effect to any “keepwell, support or other agreement” (as such terms are
used under the Commodity Exchange Act) provided for the benefit of such Loan
Guarantor). If a Hedge Obligation arises under a master agreement governing more
than one swap, such exclusion shall apply only to the portion of such Hedge
Obligation that is attributable to swaps for which such Loan Guaranty or
security interest is or becomes illegal.

“Excluded Subsidiary” means (a) any Subsidiary that is not a wholly-owned
Subsidiary, (b) any Subsidiary that is prohibited by any Requirement of Law from
guaranteeing the Secured Obligations, (c) (i) any direct or indirect Domestic
Subsidiary of a Foreign Subsidiary (that is a “controlled foreign corporation”
within the meaning of Section 957 of the Code) and (ii) any Domestic Subsidiary,
substantially all of the direct or indirect assets of which are Equity Interests
of one or more “controlled foreign corporations” within the meaning of
Section 957 of the Code, (d) any Restricted Subsidiary acquired pursuant to a
Permitted Acquisition financed with or subject to secured Indebtedness incurred
pursuant to Section 6.01(l) or Section 6.01(t) and each Restricted Subsidiary
thereof that guarantees such Indebtedness to the extent and so long as the
financing documentation relating thereto prohibits such Restricted Subsidiary
from guaranteeing, or granting a Lien on any of its assets to secure, the
Secured Obligations; provided that after such time that such prohibitions on
guarantees or granting of Liens lapses or terminates, such Restricted Subsidiary
shall no longer be an Excluded Subsidiary, (e) any other Subsidiary with respect
to which, in the reasonable judgment of the Administrative Agent (confirmed in
writing by notice to the Borrower Representative), the cost or other
consequences (including any adverse tax consequences) of providing a Guarantee
shall be excessive in view of the benefits to be obtained by the Lenders
therefrom, (f) any not-for-profit Subsidiary, (g) any Captive Insurance
Subsidiaries, (h) each Unrestricted Subsidiary and (i) any Immaterial Subsidiary
that the Company elects by notice to the Administrative Agent to treat as an
Excluded Subsidiary pursuant to this clause (i); provided that any such
Immaterial Subsidiary shall cease to be so treated as an Excluded Subsidiary
upon written notice from the Borrower Representative to the Administrative
Agent; provided, further, that, notwithstanding anything to the contrary set
forth in this definition, no Subsidiary that guarantees the Term Loans or the
Holdings Notes shall be an Excluded Subsidiary.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient, or required to be withheld or deducted from a payment to a
Recipient, with respect to the Administrative Agent, any Lender, any Issuing
Bank or any other recipient of any payment to be made by or on account of any
obligation of any Borrower hereunder, (a) Taxes imposed on or measured by net
income (however denominated), franchise Taxes and branch profits Taxes, in each
case, (i) imposed as a result of such Recipient being organized under the laws
of, or having its principal office or, in the case of any Lender,

 

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its applicable lending office located in, the jurisdiction imposing such Tax (or
any political subdivision thereof) or (ii) that are Connection Taxes, (b) in the
case of a Foreign Lender, any U.S. federal withholding Tax that is imposed on
amounts payable to such Foreign Lender pursuant to laws in force at the time
such Foreign Lender becomes a Lender hereunder (other than an assignee pursuant
to a request by a Borrower under Section 2.19(b)) or designates a new lending
office hereunder, or any additional U.S. federal withholding Tax that is imposed
on amounts payable to a Foreign Lender after the time such Foreign Lender
becomes a Lender hereunder or designates a new lending office hereunder, except
that Taxes in this clause (b) shall not include (i) additional U.S. federal
withholding Tax that may be imposed on amounts payable to a Foreign Lender after
the time such Foreign Lender becomes a party to the Agreement (or designates a
new lending office), as a result of a Change in Tax Law after such time and
(ii) any amount with respect to U.S. federal withholding Tax that such Foreign
Lender (or its assignor, if any) was previously entitled to receive pursuant to
Section 2.17, if any, with respect to such withholding Tax at the time such
Foreign Lender designates a new lending office (or at the time of the
assignment), (c) any Taxes attributable to such Recipient’s failure to comply
with Section 2.17(f), and (d) any U.S. federal withholding Tax imposed by FATCA.

“Existing Credit Agreement” means the Credit Agreement, dated as of November 16,
2010, among Holdings, the Company, the other loan parties from time to time
party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the
financial institutions from time to time party thereto.

“Existing Letters of Credit” means the letters of credit set forth on Schedule
2.06 hereto.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof and any agreements entered into
pursuant to Section 1471(b)(1) of the Code.

“Federal Funds Effective Rate” means (a) the weighted average (rounded upwards,
if necessary, to the next 1/100 of 1%) of interest rates on overnight federal
funds transactions with members of the Federal Reserve System arranged by
federal funds brokers on the applicable Business Day (or on the preceding
Business Day, if the applicable day is not a Business Day), as published by the
Federal Reserve Bank of New York on the next Business Day; or (b) if no such
rate is published on the next Business Day, the average rate (rounded upwards,
if necessary, to the nearest 1/100 of 1%) charged to BofA on the applicable day
on such transactions, as determined by the Administrative Agent.

“Fee Letter” means that certain Fee Letter dated May 29, 2012, among MergerSub,
Goldman Sachs Lending Partners LLC, Merrill Lynch, Pierce, Fenner & Smith
Incorporated and BofA.

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

“First Lien Debt Cap” has the meaning assigned to such term in the Intercreditor
Agreement.

“First Lien Leverage Ratio” has the meaning assigned to such term (including
component definitions therein) in the Term Loan Agreement, as in effect on the
Term Loan Closing Date.

“First Lien Obligations” has the meaning assigned to such term in the
Intercreditor Agreement.

“Fixed Charges” means, with reference to any period, without duplication, cash
Interest Expense, plus scheduled principal payments on Indebtedness made during
such period, plus expense for income taxes paid in cash, plus dividends or
distributions and repurchases, redemptions or retirement of the

 

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Equity Interests of Holdings, in each case paid in cash, all calculated for
Holdings and its Restricted Subsidiaries on a consolidated basis; provided that
any dividends or distributions made by Holdings pursuant to Section 6.08(a)(vi)
shall be excluded from Fixed Charges for purposes of calculating compliance with
Section 6.12.

“Fixed Charge Coverage Ratio” means, for any period, the ratio of (a) EBITDA
minus the unfinanced portion of Capital Expenditures to (b) Fixed Charges, all
calculated for Holdings and its Restricted Subsidiaries on a consolidated basis.

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

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

“Funding Accounts” means the deposit account(s) designated by Borrowers in
writing from time to time for the deposit of proceeds of any Borrowings.

“GAAP” means generally accepted accounting principles in the United States of
America.

“Glenwood” means Glenwood Acquisition LLC, a Delaware limited liability company.

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

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business or customary and
reasonable indemnity obligations in effect on the Effective Date or entered into
in connection with any acquisition or disposition of assets permitted under this
Agreement (other than such obligations with respect to Indebtedness). The amount
of any Guarantee shall be deemed to be an amount equal to the stated or
determinable amount of the Indebtedness or other obligation in respect of which
such Guarantee is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is required to
perform thereunder) as determined by such Person in good faith.

“Guaranteed Obligations” has the meaning assigned to such term in Section 10.01.

“Guarantor Percentage” has the meaning assigned to such term in Section 10.10.

 

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“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.

“Hedge Obligations” means, with respect to a Loan Party, its obligations under a
Swap Agreement that constitutes a “swap” within the meaning of Section 1a(47) of
the Commodity Exchange Act.

“Holdings” means Interline Brands, Inc., a Delaware corporation.

“Holdings Notes” means the 10% / 10 3⁄4% senior unsecured notes due 2018 issued
by MergerSub pursuant to the Holdings Notes Indenture (and assumed by Holdings
in the Merger) and the Indebtedness represented thereby.

“Holdings Notes Documents” means the Holdings Notes Indenture and all other
instruments, agreements and other documents evidencing or governing the Holdings
Notes or providing for any Guarantee, obligation, security or other right in
respect thereof.

“Holdings Notes Indenture” means the Indenture, dated as of August 6, 2012,
between MergerSub and Wells Fargo Bank, National Association, as trustee, in
respect of the Holdings Notes.

“Holdings Refinancing Indebtedness” means a refinancing of the Holdings Notes
permitted pursuant to Sections 6.01(c) and (i).

“Holdings Security Event” has the meaning set forth in Section 5.13(f).

“Immaterial Subsidiary” means, as of any date, any Subsidiary of the Company
(a) having Consolidated Total Assets in an amount of less than 5.0% of
Consolidated Total Assets and (b) contributing less than 5.0% of the
consolidated revenues of the Company and its Subsidiaries, in each case, for the
most recently ended Reference Period; provided that the Consolidated Total
Assets (as so determined) and revenues (as so determined) of all Immaterial
Subsidiaries shall not exceed 5.0% of Consolidated Total Assets or 5.0% of the
consolidated revenues of the Company and its Subsidiaries for the relevant
Reference Period, as the case may be.

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

 

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such Person is not liable therefor; provided, that (i) the term “Indebtedness”
shall not include (A) post-closing payment adjustments or unliquidated earn-outs
to which the seller in a Permitted Acquisition may be entitled or (B) any
indebtedness or other obligation for which irrevocable notice of redemption has
been duly given and for which adequate redemption consideration has been
irrevocably deposited with the applicable trustee or paying agent in trust for
the holders of such indebtedness or obligation or that has otherwise been
defeased or satisfied and discharged pursuant to the terms thereof, and
(ii) notwithstanding any changes in GAAP resulting from the implementation of
lease accounting rules after the Effective Date, no lease obligations shall be
treated as Indebtedness to the extent that such lease obligations would not have
been treated as Indebtedness prior to such change in GAAP.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or
with respect to any payment made by or on account of any obligation of any
Borrower hereunder and (b) to the extent not otherwise described in the
foregoing clause (a), Other Taxes.

“Indemnitee” has the meaning assigned to such term in Section 9.03(b).

“Information” has the meaning assigned to such term in Section 9.12.

“Intercompany Note” means a promissory note substantially in the form of Exhibit
F (or in such other form reasonably satisfactory to Administrative Agent)
evidencing Indebtedness owed among the Loan Parties.

“Intercreditor Agreement” means an Intercreditor Agreement entered into
following the Effective Date substantially in the form of Exhibit I with such
changes thereto as the Administrative Agent is authorized to enter into.

“Interest Coverage Ratio” has the meaning assigned to such term (including
component definitions therein) in the Term Loan Agreement, as in effect on the
Term Loan Closing Date; provided, that solely to the extent Section 6.01(t)
shall apply to Holdings Refinancing Indebtedness, the calculation of
“Consolidated Interest Expense” thereunder shall include Holdings.

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

“Interest Expense” means, with reference to any period, total interest expense
(including that attributable to Capital Lease Obligations) of Holdings and its
Restricted Subsidiaries for such period with respect to all outstanding
Indebtedness of Holdings and its Restricted Subsidiaries (including all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers’ acceptance financing and net costs under Swap Agreements
in respect of interest rates to the extent such net costs are allocable to such
period in accordance with GAAP), net of interest income to the extent deducted
in determining net income, calculated on a consolidated basis for Holdings and
its Restricted Subsidiaries for such period in accordance with GAAP; provided
that, notwithstanding any changes in GAAP resulting from the implementation of
lease accounting rules after the Effective Date, no lease payments shall be
treated as Interest Expense to the extent that such lease payments would not
have been treated as Interest Expense prior to such change in GAAP; provided,
further, that (i) except as provided in clause (ii) below, there shall be
excluded from Interest Expense for any period the cash interest expense (or cash
interest income) of all Unrestricted Subsidiaries for such period to the extent
otherwise included in Interest Expense, (ii) there shall be included in
determining Interest Expense for any period the cash interest expense (or
income) of any Acquired Entity or Business acquired since the beginning of such
period and of any Converted Restricted Subsidiary converted since the beginning
of such period, in each case based on the cash interest expense (or income) of
such Acquired Entity or Business or Converted

 

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Restricted Subsidiary for such period (including the portion thereof occurring
prior to such acquisition or conversion) assuming any Indebtedness incurred or
repaid in connection with any such acquisition or conversion had been incurred
or prepaid on the first day of such period, and (iii) there shall be excluded
from determining Interest Expense for any period the cash interest expense (or
income) of any Sold Entity or Business disposed of since the beginning of such
period, based on the cash interest expense (or income) relating to any
Indebtedness relieved, retired or repaid in connection with any such disposition
of such Sold Entity or Business during such period (including the portion
thereof occurring prior to such disposal) assuming such debt relieved, retired
or repaid in connection with such disposition had been relieved, retired or
repaid on the first day of such period.

“Interest Payment Date” means (a) with respect to any ABR Loan (other than a
Swingline Loan), the first day of each calendar quarter and the Maturity Date,
and (b) with respect to any Eurodollar Loan, the last day of the Interest Period
applicable to the Borrowing of which such Loan is a part and, in the case of a
Eurodollar Borrowing with an Interest Period of more than 90 days’ duration,
each day prior to the last day of such Interest Period that occurs at intervals
of 90 days’ duration after the first day of such Interest Period and the
Maturity Date.

“Interest Period” means with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is 30, 60, 90 or 180 days or, if
agreed to by all Lenders, 270 or 360 days thereafter, as the Borrower
Representative may elect; provided, that (i) if any Interest Period would end on
a day other than a Business Day, such Interest Period shall be extended to the
next succeeding Business Day unless, in the case of a Eurodollar Borrowing only,
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day and
(ii) any Interest Period pertaining to a Eurodollar Borrowing that commences on
the last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the last calendar month of such Interest
Period) shall end on the last Business Day of the last calendar month of such
Interest Period. For purposes hereof, the date of a Borrowing initially shall be
the date on which such Borrowing is made and, in the case of a Revolving
Borrowing, thereafter shall be the effective date of the most recent conversion
or continuation of such Borrowing.

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

“Inventory Appraisal” means (a) on the Effective Date, the appraisal of the
Borrowers’ and the other Loan Guarantors’ Inventory prepared by HILCO Appraisal
Services, LLC dated June 27, 2012 and (b) thereafter, the most recent inventory
appraisal conducted by an independent appraisal firm selected and engaged by the
Administrative Agent and delivered pursuant to Section 5.10.

“Inventory Reserve” shall mean the total reserve against Inventory equal to the
sum of the following:

(a) a reserve for shrink, or discrepancies that arise pertaining to inventory
quantities on hand between a Borrower’s perpetual accounting system and
inventory counts, in each case, as estimated by the Borrowers in accordance with
past practices; and

(b) a reserve determined by the Administrative Agent in the exercise of its
Permitted Discretion for Inventory which is designated returned to vendor or
which is recognized as damaged or off quality or not to customer specifications
by a Borrower; and

(c) a revaluation reserve whereby capitalized favorable variances shall be
deducted from Eligible Inventory and unfavorable variances shall not be added to
Eligible Inventory; and

(d) any other reserve as deemed appropriate by the Administrative Agent in its
Permitted Discretion, from time to time.

 

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“Issuing Bank” means, as the context may require, (a) BofA, with respect to
Letters of Credit issued by it (including the Existing Letters of Credit), and
each of its successors in such capacity as provided in Section 2.06(i), and
(b) any other Lender that becomes an Issuing Bank pursuant to Section 2.06(i),
with respect to Letters of Credit issued by it and in each case, its successors
in such capacity as provided in Section 2.06(i). An Issuing Bank may, in its
discretion, arrange for one or more Letters of Credit to be issued by Affiliates
of such Issuing Bank, in which case the term “Issuing Bank” shall include any
such Affiliate with respect to Letters of Credit issued by such Affiliate.

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

“Joint Bookrunners” means Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Goldman Sachs Lending Partners LLC.

“Junior Indebtedness” means any Subordinated Indebtedness or Indebtedness
secured by Liens that are expressly junior to the Liens of the Administrative
Agent with respect to the Collateral (other than Indebtedness among Holdings and
its Subsidiaries and/or under the Term Loan Agreement).

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

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

“LC Exposure” means, at any time, the sum of the Commercial LC Exposure and the
Standby LC Exposure. The LC Exposure of any Revolving Lender at any time shall
be its Applicable Percentage of the total LC Exposure at such time.

“Lead Arrangers” means Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Goldman Sachs Lending Partners LLC.

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

“Letter of Credit” means any letter of credit issued pursuant to this Agreement,
including the Existing Letters of Credit.

“LIBOR” means for any Interest Period with respect to a Eurodollar Borrowing,
the per annum rate of interest (rounded up, if necessary, to the nearest 1/16th
of 1%), determined by the Administrative Agent at approximately 11:00 a.m.
(London time) two Business Days prior to commencement of such Interest Period,
for a term comparable to such Interest Period, equal to (a) the ICE Benchmark
Administration LIBOR Rate, or successor thereto if such association is no longer
making such rate available, as published by Reuters (or other commercially
available source designated by the Administrative Agent); or (b) if the rate
described in clause (a) is unavailable for any reason, the interest rate at
which dollar deposits in the approximate amount of the Eurodollar Borrowing
would be offered by the Administrative Agent’s London branch to major banks in
the London interbank Eurodollar market. If the Board imposes a Reserve
Percentage with respect to LIBOR deposits, then LIBOR shall be the foregoing
rate, divided by 1 minus the Reserve Percentage.

 

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

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

“Loan Guarantor” means each Loan Party (other than a Borrower in respect of
Secured Obligations as to which such Borrower is the primary obligor).

“Loan Guaranty” means Article X of this Agreement.

“Loan Parties” means Holdings, the Borrowers, the Borrowers’ Domestic
Subsidiaries (other than any Excluded Subsidiary) and any other Person who
becomes a party to this Agreement pursuant to a Joinder Agreement and their
successors and assigns.

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

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

“Material Indebtedness” means Indebtedness (other than the Loans and Letters of
Credit), or obligations in respect of one or more Swap Agreements, of any one or
more of Holdings, the Company and its Restricted Subsidiaries in an aggregate
principal amount exceeding $35,000,000. For purposes of determining Material
Indebtedness, the “obligations” of Holdings, the Company or any Restricted
Subsidiary in respect of any Swap Agreement at any time shall be the maximum
aggregate amount (giving effect to any netting agreements) that Holdings, the
Company or such Restricted Subsidiary would be required to pay if such Swap
Agreement were terminated at such time.

“Maturity Date” means September 7, 2017 or any earlier date on which the
Commitments are reduced to zero or otherwise terminated pursuant to the terms
hereof.

“Maximum Liability” has the meaning assigned to such term in Section 10.09.

 

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“Maximum Rate” has the meaning assigned to such term in Section 9.17.

“Merger” means the merger of MergerSub with and into Holdings in accordance with
the terms of the Merger Agreement, with Holdings being the surviving entity.

“Merger Agreement” means that certain Agreement and Plan of Merger dated as of
May 29, 2012, as amended by the Acknowledgement, Waiver and Consent made as of
June 28, 2012 (the “Acknowledgement and Waiver”), executed by and among Newco,
MergerSub and Holdings, including all exhibits, schedules and disclosure letters
thereto.

“Merger Consideration” means the consideration received by the equity holders of
Holdings for their equity interests in Holdings in accordance with the terms of,
and subject to adjustment as provided in, the Merger Agreement (including any
consideration paid to dissenting equity holders).

“MergerSub” means Isabelle Acquisition Sub Inc., a Delaware corporation.

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

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

“Net Income” means, for any period, the consolidated net income (or loss) of
Holdings and its Restricted Subsidiaries, determined on a consolidated basis in
accordance with GAAP; provided that there shall be excluded (a) the income (or
deficit) of any Person accrued prior to the date it becomes a Subsidiary or is
merged into or consolidated with Holdings or any of its Restricted Subsidiaries,
(b) the income (or deficit) of any Person (other than a Restricted Subsidiary)
in which Holdings or any of its Restricted Subsidiaries has an ownership
interest, except to the extent that any such income is actually received by
Holdings or such Restricted Subsidiary in the form of dividends or similar
distributions, (c) the undistributed earnings of any Restricted Subsidiary
(other than a Loan Party) to the extent that the declaration or payment of
dividends or similar distributions by such Restricted Subsidiary is not at the
time permitted by the terms of any contractual obligation (other than under any
Loan Document) or Requirement of Law applicable to such Restricted Subsidiary,
(d) the cumulative effect of a change in accounting principles during such
period to the extent included in Net Income and (e) any income (loss) for such
period attributable to the early extinguishment of Indebtedness. Notwithstanding
any changes in GAAP resulting from the implementation of lease accounting rules
after the Effective Date, lease payments shall be treated as expenses when
calculating Net Income to the extent such payments relate to leases that would
have been treated as operating leases prior to such change in GAAP.

“Net Orderly Liquidation Value” means the orderly liquidation value (net of
costs and expenses estimated to be incurred in connection with such liquidation)
of the Eligible Inventory that is estimated to be recoverable in an orderly
liquidation of such Eligible Inventory, as determined from time to time by
reference to the most recent Inventory Appraisal.

“Net Proceeds” means, with respect to any event, (a) the cash proceeds received
in respect of such event including (i) any cash received in respect of any
non-cash proceeds (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or purchase
price adjustment receivable or otherwise, but excluding any interest payments),
but only as and when received, (ii) in the case of a casualty, insurance
proceeds and (iii) in the case of a condemnation or similar event, condemnation
awards and similar payments, net of (b) the sum of (i) all reasonable fees and
out-of-pocket expenses paid to third parties (other than Affiliates unless paid
in compliance with Section 6.09) in connection with such event (including any
underwriting, brokerage or other customary selling commissions, reasonable
legal, advisory and other fees and expenses, including title and recording

 

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expenses, associated therewith), (ii) in the case of a sale, transfer or other
disposition of an asset (including pursuant to a sale and leaseback transaction
or a casualty or a condemnation or similar proceeding), the amount of all
payments required to be made as a result of such event to repay Indebtedness
(other than Loans) secured by such asset or otherwise subject to mandatory
prepayment as a result of such event, (iii) the amount of all taxes paid (or
reasonably estimated to be payable) and (iv) the amount of any reserves
established to fund contingent liabilities (including post-closing adjustments)
reasonably estimated to be payable, in each case during the year that such event
occurred or the next succeeding year and that are directly attributable to such
event (as determined reasonably and in good faith by a Financial Officer).

“Newco” means Isabelle Holding Company Inc., a Delaware corporation, as such
corporation is to be converted into a Delaware limited liability company
pursuant to the Acknowledgement and Waiver, and merged with and into Holdings
promptly following the consummation of the Merger.

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

“Non-Paying Guarantor” has the meaning assigned to such term in Section 10.10.

“Obligated Party” has the meaning assigned to such term in Section 10.02.

“Obligations” means all unpaid principal of and accrued and unpaid interest on
the Loans, all LC Exposure, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations of the Loan Parties to the
Lenders or to any Lender, the Administrative Agent, any Issuing Bank or any
indemnified party arising under the Loan Documents.

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

“Operating Account” means account #898046220250, any disbursement account, and
any replacement accounts or additional accounts of any Loan Party maintained
with BofA as a zero balance, cash management account pursuant to and under any
agreement between such Loan Party and BofA, as modified and amended from time to
time, and through which all disbursements of any Loan Party and any designated
Subsidiary of any Borrower are made and settled on a daily basis with no
uninvested balance remaining overnight.

“Other Taxes” means any and all present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies arising from any
payment made hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement, except any such Taxes that are
Connection Taxes imposed with respect to any assignment of a Loan or Commitment
(other than an assignment made pursuant to Section 2.19(b)) treating the
assignee and assignor with respect to any assignment as the Recipient for
purposes of the definition of “Connection Taxes.”

“Overadvance” has the meaning assigned to such term in Section 2.04(a).

“Parent” has the meaning assigned to such term in the term “Permitted Payments
to Parent”.

“Participant” has the meaning assigned to such term in Section 9.04(c).

 

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“Participant Register” has the meaning assigned to such term in Section 9.04(c).

“Patriot Act” means the Uniting And Strengthening America By Providing
Appropriate Tools Required To Intercept And Obstruct Terrorism Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001)).

“Paying Guarantor” has the meaning assigned to such term in Section 10.10.

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

“Permitted Acquisition” means any Acquisition by any Loan Party or a Restricted
Subsidiary in a transaction that satisfies each of the following requirements:

(a) such Acquisition is not a hostile or contested Acquisition and shall have
been approved by the proposed target’s (or proposed target’s parent’s) board of
directors (or equivalent) governing body;

(b) the business acquired in connection with such Acquisition is not in any
material fashion engaged, directly or indirectly, in any line of business other
than the businesses in which any Borrower or any Loan Party is engaged on the
Effective Date and any business activities that are similar, related,
incidental, complementary or corollary thereto or a reasonable extension
thereof;

(c) if such Acquisition is an Acquisition of the Equity Interests of a Person,
such Acquisition (i) is structured so that the acquired Person shall become a
Loan Party or a Restricted Subsidiary pursuant to the terms of this Agreement,
provided, that such Person shall be permitted to become an Unrestricted
Subsidiary if, after giving pro forma effect to such Acquisition, either
(A) both (1) Availability is greater than the higher of 12.5% of the Commitments
and $31,250,000 and (2) the Fixed Charge Coverage Ratio as of the last day of
the Reference Period is greater than 1.0 to 1.0 or (B) Availability is greater
than the higher of 17.5% of the Commitments and $43,750,000, and (ii) together
with the consummation of the transactions contemplated in Section 5.13 in
connection with such Acquisition, will not result in any violation of Regulation
U;

(d) at or prior to the closing of the Acquisition, Holdings (or its Restricted
Subsidiary making such Acquisition) and the proposed target (and, to the extent
required, its Restricted Subsidiaries) shall have executed such documents, and
taken such action, required under Section 5.13;

(e) any Borrower or any Loan Guarantor shall not, as a result of or in
connection with any such Acquisition, assume or incur any direct or contingent
liabilities (whether relating to environmental, tax, litigation, or other
matters) that could reasonably be expected to have a Material Adverse Effect;

(f) in connection with an Acquisition of the Equity Interests in any Person
which becomes a Restricted Subsidiary, all Liens on property of such Person
shall be terminated unless such Liens are permitted pursuant to the Loan
Documents, and in connection with an Acquisition of the assets of any Person,
all Liens on such assets shall be terminated unless such Liens are permitted
pursuant to the Loan Documents;

(g) all material governmental and third-party approvals necessary in connection
with such Acquisition shall have been obtained and be in full force and effect;

(h) no Default or Event of Default exists or would result therefrom;

 

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(i) as soon as available, but not less than five (5) days (or such shorter
period as approved by the Administrative Agent) prior to the consummation of any
Acquisition having an Acquisition Consideration in excess of $75,000,000, the
Borrower Representative shall provide to the Administrative Agent (i) notice of
such Acquisition, (ii) a copy of the final form (or, if not available, the
current draft) for the purchase agreement and all schedules and exhibits thereto
and (iii) a certificate of a senior officer of the Borrower Representative
certifying (and showing the calculations therefor in reasonable detail) that the
Loan Parties would be in compliance with the requirements of clauses (c) through
(h) preceding, including, if applicable, pro forma financial statements
indicating compliance with Section 6.04(p); and

(j) prior to inclusion of the Accounts and Inventory acquired in connection with
any such Acquisition in the determination of the Borrowing Base (which, for the
avoidance of doubt, must be owned by a Borrower), (i) the Administrative Agent
shall have obtained an Inventory Appraisal with respect to such Inventory and
conducted an audit and field examination of such Accounts to its reasonable
satisfaction; provided, that such acquired Accounts and Inventory that otherwise
satisfy the eligibility criteria (as determined in good faith by the Company
based on a review of such eligibility criteria and the due diligence for such
Acquisition) may be included in the Borrowing Base for a period not to exceed 60
days and in an aggregate amount not to exceed 10% of the Borrowing Base pending
such field examination and appraisal and (ii) any applicable Reserves have been
established by the Administrative Agent in consultation with the Company, and
all appropriate lien filings and collateral documentation have been duly
completed, executed and delivered to the Administrative Agent, in each case, to
the extent required by, and in accordance with, the Loan Documents.

“Permitted Discretion” means a determination made in good faith and in the
exercise of reasonable (from the perspective of a secured asset-based lender)
business judgment and subject to the requirements, as applicable, of
Section 2.22.

“Permitted Encumbrances” means:

(a) Liens imposed by law for taxes, assessments or other governmental charges or
levies that are not yet due or are being contested in compliance with
Section 5.04;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other
like Liens imposed by law, arising in the ordinary course of business and
securing obligations that are not overdue by more than 45 days or are being
contested in compliance with Section 5.04;

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

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

(e) judgment liens in respect of judgments that do not constitute an Event of
Default under clause (k) of Section 7.01;

(f) easements, zoning restrictions, rights-of-way, minor defects or
irregularities of title and similar encumbrances on real property that do not
secure any monetary obligations and do not materially interfere with the
ordinary conduct of business of any Borrower or any Restricted Subsidiary;

(g) landlords’ and lessors’ and other like Liens in respect of rent not in
default; and

 

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(h) any interest or title of a lessee, licensee, lessor or licensor under any
lease or sublease entered into by a Borrower or any of its Subsidiaries in the
ordinary course of its business and covering only the assets so leased or
licensed;

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

“Permitted Holders” means (a) the Sponsors and members of management of
Holdings, the Company or a direct or indirect parent of Holdings and (b) any
group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the
Securities Exchange Act of 1934 or any successor provision) of which any of the
foregoing are members; provided, however, that, in the case of such group and
without giving effect to the existence of such group or any other group, the
entities set forth in the foregoing clause (a), collectively, have beneficial
ownership of Equity Interests representing more than 50% of the aggregate
ordinary voting power represented by the issued and outstanding Equity Interests
of Holdings or any direct or indirect parent of Holdings.

“Permitted Investments” means:

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

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

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

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

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

(f) investments in securities with maturities of six months or less from the
date of acquisition and rated at least “A” by S&P or “A” by Moody’s (or, if at
any time neither S&P nor Moody’s shall be rating such obligations, an equivalent
rating from another nationally recognized rating service).

“Permitted Payments to Parent” means, without duplication as to amounts:

(a) any Restricted Payment made to any direct or indirect parent company of
Holdings (collectively, a “Parent”) to be used by Parent solely (i) to pay its
franchise taxes and other fees required to maintain its corporate existence,
(ii) to pay for general corporate and overhead expenses (including salaries and
other compensation (including bonuses and benefits) of the employees and
directors, board activities, insurance, legal, accounting, corporate reporting
and filing, administrative and other general operating expenses) incurred by
Parent in the ordinary course of business and attributable to the

 

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ownership or operations of Holdings and its Subsidiaries, (iii) to pay any
reasonable and customary indemnification claims made by directors or officers of
the Company or Parent and attributable to the ownership or operations of
Holdings and its Subsidiaries, (iv) to pay expenses incurred in connection with
offerings of securities, debt financings, acquisitions, dispositions or other
non-ordinary course transactions for Holdings and its Subsidiaries and (v) to
satisfy principal, interest and other payment obligations of Holdings on
Indebtedness of Parent, the proceeds of which were contributed to Holdings;
provided, however, that all such Restricted Payments pursuant to this clause
(a) shall not exceed in the aggregate $15,000,000 per year; and

(b) payments to Parent in respect of federal, state or local income, franchise
or similar taxes of Holdings and its Subsidiaries (“Tax Payments”); provided,
however, that the aggregate Tax Payments shall not exceed (i) the aggregate
amount of the relevant tax (including any penalties and interest) that Holdings
would owe after the Effective Date for United States Federal, state and local
income tax purposes filing a separate tax return (or a consolidated or combined
return with any Subsidiaries of Holdings that are members of a consolidated or
combined group with Parent), taking into account any carryovers and carrybacks
of tax attributes (such as net operating losses) of Holdings and its
Subsidiaries, less (ii) the amount of any income taxes that Holdings or its
Subsidiaries pay directly to a taxing authority after the Effective Date.

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

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

“Post-Acquisition Period” means, with respect to any Permitted Acquisition, the
period beginning on the date such Permitted Acquisition is consummated and
ending on the last day of the fourth full consecutive fiscal quarter immediately
following the date on which such Permitted Acquisition is consummated.

“Prime Rate” means the rate of interest announced by BofA from time to time as
its prime rate. Such rate is set by BofA on the basis of various factors,
including its 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 rate. Any change in such rate announced by BofA
shall take effect at the opening of business on the day specified in the public
announcement of such change.

“Pro Forma Adjustment” means for the most recently ended four fiscal quarters
that includes all or any part of a fiscal quarter ending prior to the end of any
Post-Acquisition Period, with respect to the Acquired EBITDA of the applicable
Acquired Entity or Business or the EBITDA of Holdings and its Subsidiaries, the
pro forma increase or decrease in such Acquired EBITDA or such EBITDA, as the
case may be, projected in good faith as a result of (a) actions taken or
expected to be taken during such Post-Acquisition Period for the purposes of
realizing reasonably identifiable and factually supportable cost savings or
(b) any additional costs incurred during such Post-Acquisition Period, in each
case in connection with the combination of the operations of such Acquired
Entity or Business with the operations of the Borrowers and the Restricted
Subsidiaries; provided that, so long as such actions are taken or expected to be
taken during such Post-Acquisition Period or such costs are incurred during such
Post-Acquisition Period, as applicable, it may be assumed, for purposes of
projecting such pro forma increase or decrease to such Acquired EBITDA or such
EBITDA, as the case may be, that such cost savings will be realizable during the
entirety of the most recently ended four fiscal quarters, or such

 

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additional costs, as applicable, will be incurred during the entirety of such
the most recently ended four fiscal quarters; provided further that any such pro
forma increase or decrease to such Acquired EBITDA or such EBITDA, as the case
may be, shall be without duplication for cost savings or additional costs
already included in such Acquired EBITDA or such EBITDA, as the case may be, for
the most recently ended four fiscal quarters.

“Pro Forma Adjustment Certificate” means any certificate of a Financial Officer
of Holdings delivered pursuant to Section 5.01 (c).

“Pro Forma Basis” has the meaning assigned to such term in the Term Loan
Agreement, as in effect on the Term Loan Closing Date and inclusive of the
effect of Section 1.04 of the Term Loan Agreement thereon (but, for the
avoidance of doubt, such definition does not apply to the term “pro forma basis”
used without capitalization herein).

“Pro Forma Entity” has the meaning assigned to such term in the definition of
“Acquired EBITDA”.

“Projections” has the meaning assigned to such term in Section 5.01(d).

“Protective Advances” has the meaning assigned to such term in Section 2.04(a).

“Qualified ECP” means a Loan Party with total assets exceeding $10,000,000, or
that constitutes an “eligible contract participant” under the Commodity Exchange
Act and can cause another Person to qualify as an “eligible contract
participant” under Section 1a(18)(A)(v)(II) of such act.

“Qualified Holdings Debt” means unsecured Indebtedness of Holdings (other than
the Holdings Notes and any Holdings Refinancing Indebtedness) that (a) is not
subject to any Guarantee by any Subsidiary of Holdings, (b) will not mature
prior to the date that is 180 days after the Maturity Date, (c) has no scheduled
amortization or scheduled payments of principal prior to the date that is 180
days after the Maturity Date and is not subject to mandatory redemption,
repurchase, prepayment or sinking fund obligation (it being understood that such
Indebtedness may have mandatory prepayment, repurchase or redemption provisions
satisfying the requirements of clause (d) below), and (d) has mandatory
prepayment, repurchase or redemption, covenant, default and remedy provisions
customary for senior discount notes of an issuer that is the parent of a
borrower under senior secured credit facilities; provided, that the Company
shall have delivered a certificate of a Financial Officer to the Administrative
Agent at least five Business Days prior to the incurrence of such Indebtedness,
together with a reasonably detailed description of the material terms and
conditions of such Indebtedness or drafts of the documentation relating thereto,
stating that the Company has reasonably determined in good faith that such terms
and conditions satisfy the foregoing requirement (and such certificate shall be
conclusive evidence that such terms and conditions satisfy the foregoing
requirement unless the Administrative Agent notifies the Company within such
five Business Day period that it disagrees with such determination (including a
reasonably detailed description of the basis upon which it disagrees));
provided, further, that any such Indebtedness shall constitute Qualified
Holdings Debt only if immediately after giving effect to the issuance or
incurrence thereof and the use of proceeds thereof, no Event of Default shall
have occurred and be continuing.

“Qualifying IPO” means the issuance and sale by Holdings or any other Person of
which Holdings is a direct or indirect wholly-owned Subsidiary of its Equity
Interests in an underwritten primary public offering (other than a public
offering pursuant to a registration statement on Form S-8) pursuant to an
effective registration statement filed with the SEC in accordance with the
Securities Act (whether alone or in connection with a secondary public offering)
pursuant to which Net Proceeds of at least $30,000,000 are received by or
contributed to the Company.

 

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“Recipient” means (a) the Administrative Agent, (b) any Lender and (c) any
Issuing Bank, as applicable, in its capacity as a Person receiving a payment
under the Loan Documents.

“Reference Period” means the most recent four consecutive fiscal quarters for
which financial statements have been delivered pursuant Section 5.01(a) or
Section 5.01(b).

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

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

“Rent Reserve” means the aggregate of (a) all past due rent and other amounts
owing by a Loan Party to any landlord, warehouseman, processor, repairman,
mechanic, shipper, freight forwarder, broker or other Person who possesses, any
Collateral or could assert a Lien on any Collateral and (b) a reserve equal to
at least three months’ rent and other charges that could be payable to any such
Person (unless it has executed a Collateral Access Agreement).

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

“Required Lenders” means, at any time, Lenders having Credit Exposure and unused
Commitments representing more than 50% of the sum of the total Credit Exposure
and unused Commitments at such time.

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

Reserve Percentage: the reserve percentage (expressed as a decimal, rounded up
to the nearest 1/16th of 1%) applicable to member banks under regulations issued
by the Board for determining the maximum reserve requirement for Eurocurrency
liabilities.

“Reserves” means the Debt Reserve, Dilution Reserve, Inventory Reserve, Rent
Reserve, Banking Services Reserve, reserve for Swap Obligations and any other
reserves which the Administrative Agent deems necessary, in its Permitted
Discretion, to maintain with respect to the Collateral or any Loan Party.

“Restricted Debt Payments” has the meaning assigned to such term in
Section 6.08(b).

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

 

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“Restricted Subsidiary” means any Subsidiary of a Borrower or Holdings other
than an Unrestricted Subsidiary.

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

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

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

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

“SEC” means the Securities and Exchange Commission.

“Second Supplemental Indenture” has the meaning assigned to such term in the
term “Company Notes Indenture”.

“Secured Obligations” means all Obligations, together with all (a) Banking
Services Obligations and (b) Swap Obligations owing to one or more Lenders, Lead
Arrangers or their respective Affiliates at the time of the entry into such Swap
Obligations; provided that, other than with respect to BofA and its Affiliates,
within ten (10) Business Days (or such later time as the Administrative Agent
and the Borrower Representative may agree in their reasonable discretion) after
any transaction relating to such Banking Services Obligation or Swap Obligation
is entered into, the Borrower Representative and the Lender, Lead Arranger or
Affiliate of a Lender or Lead Arranger party thereto shall have delivered
written notice (including by e-mail) to the Administrative Agent (i) stating
that such a transaction has been entered into and that it constitutes a Secured
Obligation entitled to the benefits of the Collateral Documents, (ii) describing
such Banking Services Obligation or Swap Obligation and setting forth the
maximum amount to be secured by the Collateral and the methodology to be used in
calculating such amount, which amount may be established or increased (by
further written notice to the Administrative Agent from time to time) as long as
no Default or Event of Default exists and no Overadvance would result therefrom
and (iii) agreeing to be bound by Section 2.18(b) and Article VIII; provided,
further, that the Secured Obligations of a Loan Party shall not include its
Excluded Swap Obligations.

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

“Securities Act” means the Securities Act of 1933 and the rules and regulations
of the SEC promulgated thereunder.

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

“Settlement” has the meaning assigned to such term in Section 2.05(c).

 

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“Settlement Date” has the meaning assigned to such term in Section 2.05(c).

“Sold Entity or Business” has the meaning assigned to such term in the
definition of “EBITDA”.

“Solvency Certificate” has the meaning assigned to such term in Section 4.01(f).

“Specified Distribution” means a distribution made by Holdings on the Effective
Date to fund a portion of the Merger Consideration and to pay the fees and
expenses incurred in connection with the Transactions.

“Specified Equity Contribution” has the meaning assigned to such term in
Section 7.02(a).

“Specified Investment” has the meaning assigned to such term in Section 6.04(p).

“Specified Loan Party” means a Loan Party that is not then an “eligible contract
participant” under the Commodity Exchange Act (determined prior to giving effect
to Section 10.12).

“Specified Merger Agreement Representations” means such of the representations
made by (or related to) Holdings and its Subsidiaries with respect to Holdings
and its Subsidiaries in the Merger Agreement as are material to the interests of
the Lenders, but only to the extent that Newco has (or its applicable affiliate
has) the right to terminate its obligations (or otherwise not have an obligation
to close) under the Merger Agreement as a result of a breach of one or more of
such representations in the Merger Agreement.

“Specified Properties” means the properties (and the improvements thereon) owned
by the Company and its Restricted Subsidiaries that are identified on Schedule
1.01 hereto.

“Sponsors” means GS Capital Partners VI, L.P., P2 Capital Master Fund I, L.P.
and their respective Affiliates.

“Standby LC Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding standby Letters of Credit at such time and (b) the
aggregate amount of all LC Disbursements relating to standby Letters of Credit
that have not yet been reimbursed by or on behalf of the Borrowers at such time.
The Standby LC Exposure of any Revolving Lender at any time shall be its
Applicable Percentage of the total Standby LC Exposure at such time.

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

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

 

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

“Supermajority Lenders” means, at any time, Lenders having Credit Exposure and
unused Commitments representing at least 66.67% of the sum of the total Credit
Exposure and unused Commitments at such time.

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

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

“Swingline Exposure” means, at any time, the sum of the aggregate amount of all
outstanding Swingline Loans at such time. The Swingline Exposure of any
Revolving Lender at any time shall be its Applicable Percentage of the total
Swingline Exposure at such time.

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

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

“Syndication Agent” means Goldman Sachs Lending Partners LLC.

“Tax Payments” has the meaning assigned to such term in the definition for
“Permitted Payments to Parent”.

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

“Term Loans” means the loans and advances made pursuant to the Term Loan
Agreement by the lenders from time to time party thereto.

“Term Loan Agreement” means that certain First Lien Term Loan Agreement dated as
of March 17, 2014, among the Company, as borrower, Holdings and the subsidiaries
of the Company from time to time party thereto, as guarantors, Barclays Bank
PLC, as administrative agent, and the lenders from time to time party thereto,
as it may be amended or otherwise modified or replaced from time to time.

“Term Loan Closing Date” means the date on which the initial Term Loans are
advanced under the initial Term Loan Agreement.

 

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“Term Loan Documents” has the meaning assigned to the term “Loan Documents” in
the Term Loan Agreement (or any similar term in any successor agreement).

“Total Leverage Ratio” has the meaning assigned to such term (including the
component definitions therein) in the Term Loan Agreement, as in effect on the
Term Loan Closing Date.

“Transactions” means (a) the execution, delivery and performance by the Loan
Parties of this Agreement, the borrowing of Loans and other credit extensions,
the use of the proceeds thereof in accordance with Section 5.08 and the issuance
of Letters of Credit hereunder, (b) the consummation of the Equity Contribution,
(c) the consummation of the Merger and the payment of the Merger Consideration
in accordance with the terms of the Merger Agreement, (d) the issuance of the
Holdings Notes and (e) the execution and delivery of, and solicitation of
consents for, the Second Supplemental Indenture.

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

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

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

“Unrestricted Subsidiary” means any Subsidiary of any Borrower that is acquired
or created after the Effective Date and designated by the Borrower
Representative at the time of acquisition or formation thereof as an
Unrestricted Subsidiary hereunder by written notice to the Administrative Agent;
provided that the Borrowers shall only be permitted to so designate a new
Unrestricted Subsidiary after the Effective Date and so long as:

(a) immediately before and after such designation, no Default or Event of
Default shall have occurred and be continuing;

(b) no Subsidiary may be designated as an Unrestricted Subsidiary if it is a
“Restricted Subsidiary” for the purpose of the Term Loan Documents, the Holdings
Notes Documents or any other Indebtedness of Holdings or its Subsidiaries (other
than Indebtedness of another Unrestricted Subsidiary); and

(c) no Unrestricted Subsidiary may be redesignated as a Restricted Subsidiary at
any time after being so designated as an Unrestricted Subsidiary;

(d) immediately after giving effect to such designation, Holdings, the Company
and its Restricted Subsidiaries shall be in compliance, on a pro forma basis,
with the covenant set forth in Section 6.12, whether or not a Covenant Trigger
Period then exists, as demonstrated to the reasonable satisfaction of the
Administrative Agent;

(e) no Subsidiary shall be designated as an Unrestricted Subsidiary if such
Subsidiary owns (directly or indirectly) any Equity Interests or Indebtedness
of, or holds Liens on any property of, Holdings, any Borrower or any Restricted
Subsidiary; and

 

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(f) no Subsidiary shall be designated as an Unrestricted Subsidiary if it (i) is
a party to any agreement, contract, arrangement or understanding with Holdings,
any Borrower or any Restricted Subsidiary unless the terms of any such
agreement, contract, arrangement or understanding are no less favorable to
Holdings, such Borrower or such Restricted Subsidiary than those that might be
obtained at the time from Persons who are not Affiliates of Holdings, any
Borrower or any Restricted Subsidiary, and (ii) is a Person with respect to
which Holdings, any Borrower or any of the Restricted Subsidiaries has any
direct or indirect obligation (A) to subscribe for additional Equity Interests
or (B) to maintain or preserve such Person’s financial condition or to cause
such Person to achieve any specified levels of operating results.

The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute
an investment by its parent therein at the date of designation in an amount
equal to the net book value of its parent’s investment immediately prior to such
designation therein. Any contingent obligations or Guarantee incurred by
Holdings, any Borrower or any Restricted Subsidiary in respect of any
Indebtedness or other obligations of the Subsidiary being so designated
(including those incurred prior to such designation) will be deemed to have been
incurred at the time of such designation.

“U.S. Tax Certificate” has the meaning assigned to such term in Section 2.17(f).

“Wilmar Financial” has the meaning assigned to such term in the preamble of this
Agreement.

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

“Withholding Agent” means any Borrower or the Administrative Agent as required
by applicable Requirement of Law.

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

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

 

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otherwise require, refer to such a Subsidiary of a Loan Party, and (f) the words
“asset” and “property” shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.

SECTION 1.04 Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided that, if the
Borrower Representative notifies the Administrative Agent that the Borrowers
request an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower Representative that the Required Lenders request an amendment to any
provision hereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then
such provision shall be interpreted on the basis of GAAP as in effect and
applied immediately before such change shall have become effective until such
notice shall have been withdrawn or such provision amended in accordance
herewith. In the event that historical accounting practices, systems or reserves
relating to the components of the Borrowing Base are modified in a manner that
is adverse to the Lenders in any material respect, the Borrowers will agree to
maintain such additional reserves (for purposes of computing the Borrowing Base)
in respect to the components of the Borrowing Base and make such other
adjustments (which may include maintaining additional reserves, modifying the
advance rates or modifying the eligibility criteria for the components of the
Borrowing Base) as may be requested by the Administrative Agent in its
reasonable credit judgment.

ARTICLE II

THE CREDITS

SECTION 2.01 Commitments. Subject to the terms and conditions set forth herein,
each Lender agrees to make Revolving Loans to the Borrowers from time to time
during the Availability Period in an aggregate principal amount that will not
result in (a) such Lender’s Credit Exposure exceeding such Lender’s Commitment
or (b) the Aggregate Credit Exposure exceeding the lesser of (x) the Commitments
or (y) the Borrowing Base, subject to the Administrative Agent’s authority, in
its sole discretion, to make Protective Advances pursuant to the terms of
Section 2.04. Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrowers may borrow, prepay and reborrow
Revolving Loans.

SECTION 2.02 Loans and Borrowings. (a) Each Loan (other than a Swingline Loan)
shall be made as part of a Borrowing consisting of Loans of the same Class and
Type made by the Lenders ratably in accordance with their respective
Commitments. Any Protective Advance and any Swingline Loan shall be made in
accordance with the procedures set forth in Sections 2.04 and 2.05,
respectively.

(b) Subject to Section 2.14, each Revolving Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower Representative may
request in accordance herewith, provided that all Borrowings made on the
Effective Date must be made as ABR Borrowings but may be converted into
Eurodollar Borrowings in accordance with Section 2.08. Each Swingline Loan shall
be an ABR Loan. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrowers to repay such Loan in accordance with the terms of this
Agreement; provided further that any such branch or Affiliate shall be treated
for purposes of Section 2.17 of this Agreement (and related defined terms) as if
it were a Lender in respect of its making such Eurodollar Loan and shall be
entitled to the indemnities and similar provisions, and shall be subject to the
limitations and requirements of such indemnities and similar provisions,
contained in Section 2.17.

 

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(c) At the commencement of each Interest Period for any Eurodollar Revolving
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of $1,000,000 and not less than $5,000,000. ABR Revolving Borrowings
may be in any amount. Borrowings of more than one Type and Class may be
outstanding at the same time; provided that there shall not at any time be more
than a total of ten (10) Eurodollar Borrowings outstanding.

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

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

(i) the name of the applicable Borrower;

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

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

(iv) whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
and

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

If no election as to the Type of Revolving Borrowing is specified, then the
requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period
is specified with respect to any requested Eurodollar Revolving Borrowing, then
the applicable Borrower(s) shall be deemed to have selected an Interest Period
of 30 days’ duration. Promptly following receipt of a Borrowing Request in
accordance with this Section, the Administrative Agent shall advise each Lender
of the details thereof and of the amount of such Lender’s Loan to be made as
part of the requested Borrowing.

SECTION 2.04 Protective Advances. (a) Subject to the limitations set forth
below, (i) the Administrative Agent is authorized by the Borrowers and the
Lenders, from time to time in the Administrative Agent’s sole discretion (but
shall have absolutely no obligation to), to make Loans to the Borrowers, on
behalf of all Lenders, which the Administrative Agent, in its Permitted
Discretion, deems necessary or desirable (A) to preserve or protect the
Collateral, or any portion thereof, (B) to enhance the likelihood of, or
maximize the amount of, repayment of the Loans and other Obligations or (C) to
pay any

 

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other amount chargeable to or required to be paid by the Borrowers pursuant to
the terms of this Agreement, including payments of reimbursable expenses
(including costs, fees, and expenses as described in Section 9.03) and other
sums payable under the Loan Documents and (ii) the Administrative Agent may
require the Lenders to honor requests for Loans when the aggregate Loans exceed,
or would exceed upon the funding of such Loans, the Borrowing Base
(“Overadvance”) and to forbear from requiring Borrowers to cure an Overadvance
(A) when no other Event of Default is known to the Administrative Agent, as long
as the Overadvance does not continue for more than 30 consecutive days (and no
Overadvance may exist for at least five consecutive days thereafter before
further Loans are required) and (B) regardless of whether an Event of Default
exists, if the Administrative Agent discovers an Overadvance not previously
known by it to exist, as long as from the date of such discovery the Overadvance
does not continue for more than 30 consecutive days (any of such Loans described
in this clause (a) are herein referred to as “Protective Advances”); provided
that, the aggregate amount of all Protective Advances (including Overadvances)
outstanding at any time shall not at any time exceed 10% of the Commitments and
the aggregate amount of all Overadvances may not exceed 7.5% of the Borrowing
Base; provided further that, the aggregate amount of outstanding Protective
Advances plus the aggregate Revolving Exposure of all Lenders shall not exceed
the Commitments. Protective Advances may be made or permitted to exist even if
the conditions precedent set forth in Section 4.02 have not been satisfied. The
Protective Advances shall be secured by the Liens in favor of the Administrative
Agent in and to the Collateral and shall constitute Obligations hereunder. All
Protective Advances shall be ABR Borrowings. The Administrative Agent’s
authorization to make Protective Advances may be revoked at any time by the
Required Lenders. Any such revocation must be in writing and shall become
effective prospectively upon the Administrative Agent’s receipt thereof. At any
time that there is sufficient Availability and the conditions precedent set
forth in Section 4.02 have been satisfied, the Administrative Agent may request
the Revolving Lenders to make a Revolving Loan to repay a Protective Advance. At
any other time the Administrative Agent may require the Lenders to fund their
risk participations described in Section 2.04(b). Any funding of a Protective
Advance or sufferance of an Overadvance shall not constitute a waiver by the
Administrative Agent or Lenders of any Event of Default.

(b) Upon the making of a Protective Advance by the Administrative Agent (whether
before or after the occurrence of a Default), each Lender shall be deemed,
without further action by any party hereto, to have unconditionally and
irrevocably purchased from the Administrative Agent without recourse or
warranty, an undivided interest and participation in such Protective Advance in
proportion to its Applicable Percentage. From and after the date, if any, on
which any Lender is required to fund its participation in any Protective Advance
purchased hereunder, the Administrative Agent shall promptly distribute to such
Lender, such Lender’s Applicable Percentage of all payments of principal and
interest and all proceeds of Collateral received by the Administrative Agent in
respect of such Protective Advance. In no event shall any Borrower or other Loan
Party be deemed a beneficiary of this Section nor authorized to enforce any of
its terms.

SECTION 2.05 Swingline Loans.

(a) The Administrative Agent, the Swingline Lender and the Revolving Lenders
agree that in order to facilitate the administration of this Agreement and the
other Loan Documents, promptly after the Borrower Representative requests an ABR
Borrowing, the Swingline Lender may elect to have the terms of this
Section 2.05(a) apply to such Borrowing Request by advancing, on behalf of the
Revolving Lenders and in the amount requested, same day funds to the Borrowers
on the applicable Borrowing date to the Funding Account(s) (each such Loan made
solely by the Swingline Lender pursuant to this Section 2.05(a) is referred to
in this Agreement as a “Swingline Loan”), with settlement among them as to the
Swingline Loans to take place on a periodic basis as set forth in
Section 2.05(c). Each Swingline Loan shall be subject to all the terms and
conditions applicable to other ABR Loans funded by the Revolving Lenders, except
that all payments thereon shall be payable to the Swingline Lender solely for

 

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its own account. In addition, during any Dominion Trigger Period, the Borrowers
hereby authorize the Swingline Lender to, and the Swingline Lender shall,
subject to the terms and conditions set forth herein (but without any further
written notice required), not later than 1:00 p.m., Atlanta time, on each
Business Day, make available to the Borrowers by means of a credit to the
Funding Account(s), the proceeds of a Swingline Loan to the extent necessary to
pay items to be drawn on any Operating Account that day (as determined based on
notice from the Administrative Agent). The aggregate amount of Swingline Loans
outstanding at any time shall not exceed $30,000,000. The Swingline Lender shall
not make any Swingline Loan if the requested Swingline Loan exceeds Availability
(before giving effect to such Swingline Loan) or if the Required Lenders have
notified the Swingline Lender in writing that the conditions to a Borrowing in
Section 4.02 are not satisfied. All Swingline Loans shall be ABR Borrowings.

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

(c) The Administrative Agent, on behalf of the Swingline Lender, shall request
settlement (a “Settlement”) with the Revolving Lenders on at least a weekly
basis or on any date that the Administrative Agent elects, by notifying the
Revolving Lenders of such requested Settlement by facsimile, telephone, or
e-mail no later than 12:00 noon Atlanta time on the date of such requested
Settlement (the “Settlement Date”). Each Revolving Lender (other than the
Swingline Lender, in the case of the Swingline Loans) shall transfer the amount
of such Revolving Lender’s Applicable Percentage of the outstanding principal
amount of the applicable Loan with respect to which Settlement is requested to
the Administrative Agent, to such account of the Administrative Agent as the
Administrative Agent may designate, not later than 2:00 p.m., Atlanta time, on
such Settlement Date. Settlements may occur during the existence of a Default
and whether or not the applicable conditions precedent set forth in Section 4.02
have then been satisfied. Such amounts transferred to the Administrative Agent
shall be applied against the amounts of the Swingline Lender’s Swingline Loans
and, together with Swingline Lender’s Applicable Percentage of such Swingline
Loan, shall constitute Revolving Loans of such Revolving Lenders, respectively.
If any such amount is not transferred to the Administrative Agent by any
Revolving Lender on such Settlement Date, the Swingline Lender shall be entitled
to recover such amount on demand from such Lender together with interest thereon
as specified in Section 2.07.

SECTION 2.06 Letters of Credit. (a) General. Subject to the terms and conditions
set forth herein, the Borrower Representative may request the issuance of
Letters of Credit for its own account or for the account of another Borrower or
any wholly-owned Subsidiary of the Borrower Representative, in a form reasonably
acceptable to the Administrative Agent and the applicable Issuing Bank, at any
time and from time to time during the Availability Period. In the event of any
inconsistency between the terms and conditions of this Agreement and the terms
and conditions of any form of letter of credit application or other agreement
submitted by the Borrowers to, or entered into by the Borrowers with, any
Issuing Bank relating to any Letter of Credit, the terms and conditions of this
Agreement shall control.

(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit),

 

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the Borrower Representative shall hand deliver or facsimile (or transmit by
electronic communication, if arrangements for doing so have been approved by the
applicable Issuing Bank) to the applicable Issuing Bank and the Administrative
Agent (reasonably in advance of the requested date of issuance, amendment,
renewal or extension) a notice requesting the issuance of a Letter of Credit, or
identifying the Letter of Credit to be amended, renewed or extended, and
specifying the date of issuance, amendment, renewal or extension (which shall be
a Business Day), the date on which such Letter of Credit is to expire (which
shall comply with paragraph (c) of this Section), the amount of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare, amend, renew or extend such Letter
of Credit. If requested by the applicable Issuing Bank, the applicable Borrower
also shall submit a letter of credit application on such Issuing Bank’s standard
form in connection with any request for a Letter of Credit. A Letter of Credit
shall be issued, amended, renewed or extended only if (and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrowers shall be
deemed to represent and warrant that), after giving effect to such issuance,
amendment, renewal or extension (i) the LC Exposure shall not exceed $45,000,000
and (iv) the Aggregate Credit Exposure shall not exceed the lesser of (x) the
Commitments and (y) the Borrowing Base. An Issuing Bank shall not issue (or
increase, extend or renew) a Letter of Credit if the Required Lenders have
notified such Issuing Bank in writing that the conditions therefor in
Section 4.02 are not satisfied.

(c) Expiration Date. Each Letter of Credit shall expire at or prior to the close
of business on the earlier of (i) the date one year after the date of the
issuance of such Letter of Credit (or, in the case of any renewal or extension
thereof, one year after such renewal or extension) and (ii) the date that is
five Business Days prior to the Maturity Date; provided that any standby Letter
of Credit may contain customary automatic renewal provisions agreed upon by the
applicable Borrower and the applicable Issuing Bank pursuant to which the
expiration date is automatically extended by a specific time period (but not to
a date later than the date set forth in clause (ii) above).

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

(e) Reimbursement. If an Issuing Bank shall make any LC Disbursement in respect
of a Letter of Credit, the Borrowers shall reimburse such LC Disbursement by
paying to the Administrative Agent an amount equal to such LC Disbursement not
later than 11:00 a.m., Atlanta time, on the date that such LC Disbursement is
made, if the Borrower Representative shall have received notice of such LC
Disbursement prior to 9:00 a.m., Atlanta time, on such date, or, if such notice
has not been received by the Borrower Representative prior to such time on such
date, then not later than 11:00 a.m., Atlanta time, on the Business Day
immediately following the day that the Borrower Representative receives such
notice, if such notice is not received prior to such time on the day of receipt;
provided that the Borrowers may, subject to the conditions to borrowing set
forth herein, request in accordance with Section 2.03 or 2.05

 

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that such payment be financed with an ABR Revolving Borrowing or Swingline Loan
in an equivalent amount and, to the extent so financed, the Borrowers’
obligation to make such payment shall be discharged and replaced by the
resulting ABR Revolving Borrowing or Swingline Loan. If the Borrowers fail to
make such payment when due, the Administrative Agent shall notify each Revolving
Lender of the applicable LC Disbursement, the payment then due from the
Borrowers in respect thereof and such Lender’s Applicable Percentage thereof.
Promptly following receipt of such notice, each Revolving Lender shall pay to
the Administrative Agent its Applicable Percentage of the payment then due from
the Borrowers, in the same manner as provided in Section 2.07 with respect to
Loans made by such Lender (and Section 2.07 shall apply, mutatis mutandis, to
the payment obligations of the Revolving Lenders), and the Administrative Agent
shall promptly pay to the applicable Issuing Bank the amounts so received by it
from the Revolving Lenders. Promptly following receipt by the Administrative
Agent of any payment from the Borrowers pursuant to this paragraph, the
Administrative Agent shall distribute such payment to the applicable Issuing
Bank or, to the extent that Revolving Lenders have made payments pursuant to
this paragraph to reimburse such applicable Issuing Bank, then to such Lenders
and the applicable Issuing Bank as their interests may appear. Any payment made
by a Revolving Lender pursuant to this paragraph to reimburse the applicable
Issuing Bank for any LC Disbursement (other than the funding of ABR Revolving
Loans or a Swingline Loan as contemplated above) shall not constitute a Loan and
shall not relieve the Borrowers of their obligation to reimburse such LC
Disbursement.

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

 

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

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

(i) Issuing Banks. An Issuing Bank (other than BofA except to the extent that
BofA ceases to be a Lender) may resign at any time and any existing Lender may
become an Issuing Bank at any time, in each case by written agreement among the
Borrower Representative, the Administrative Agent, the retiring Issuing Bank or
additional Issuing Bank (as applicable). The Administrative Agent shall notify
the Revolving Lenders of any such additional Issuing Bank. At the time any such
resignation shall become effective, the Borrowers shall pay all unpaid fees
accrued for the account of the retiring Issuing Bank pursuant to
Section 2.12(b). From and after the effective date of any such addition of an
Issuing Bank, the additional Issuing Bank shall have all the rights and
obligations of an Issuing Bank under this Agreement with respect to Letters of
Credit issued by it. After the resignation of an Issuing Bank hereunder, the
retiring Issuing Bank shall remain a party hereto and shall continue to have all
the rights and obligations of an Issuing Bank under this Agreement with respect
to Letters of Credit issued by it prior to such resignation, but shall not be
required to issue additional Letters of Credit.

(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower Representative receives notice
from the Administrative Agent or the Required Lenders (or, if the maturity of
the Loans has been accelerated, Revolving Lenders with LC Exposure representing
greater than 50% of the total LC Exposure) demanding the deposit of cash
collateral pursuant to this paragraph, the Borrowers shall deposit in an account
with the Administrative Agent, in the name of the Administrative Agent and for
the benefit of the Revolving Lenders (the “LC Collateral Account”), an amount in
cash equal to 103% of the LC Exposure as of such date plus accrued and unpaid
interest thereon; provided that the obligation to deposit such cash collateral
shall become effective immediately, and such deposit shall become immediately
due and payable, without demand or other notice of any kind, upon the occurrence
of any Event of Default with respect to any Borrower described in clause (h) or
(i) of Section 7.01. Such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the Secured Obligations. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account and the Borrowers hereby grant
the Administrative Agent a security interest in the LC Collateral Account. Other
than any interest earned on the investment of such deposits, which investments
shall be made at the option and sole discretion of the Administrative Agent and
at the Borrowers’ risk and expense, such deposits shall not bear interest.
Interest or profits, if any, on such investments shall accumulate in such
account. Moneys in such account shall be applied by the Administrative Agent to
reimburse the applicable Issuing Bank for LC Disbursements for which it has not
been reimbursed and, to the extent not

 

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so applied, shall be held for the satisfaction of the reimbursement obligations
of the Borrowers for the LC Exposure at such time or, if the maturity of the
Loans has been accelerated (but subject to the consent of Revolving Lenders with
LC Exposure representing greater than 50% of the total LC Exposure), be applied
to satisfy other Secured Obligations. If the Borrowers are required to provide
an amount of cash collateral hereunder as a result of the occurrence of an Event
of Default, such amount (to the extent not applied as aforesaid) shall be
returned to the Borrowers within three Business Days after all such Defaults
have been cured or waived.

(k) Existing Letters of Credit. On the Effective Date, (i) each Existing Letter
of Credit, to the extent outstanding, shall be automatically and without further
action by the parties thereto deemed converted into Letters of Credit issued
pursuant to this Section 2.06 at the request of the Borrower Representative and
subject to the provisions hereof as if such Existing Letters of Credit had been
issued on the Effective Date, (ii) such Letters of Credit shall each be included
in the calculation of “LC Exposure” and, to the extent applicable and without
duplication, in the definitions of “Commercial LC Exposure” and “Standby LC
Exposure” and (iii) all liabilities of the Borrowers and the other Loan Parties
with respect to such Existing Letters of Credit shall constitute Obligations. No
Existing Letter of Credit converted in accordance with this Section 2.06(k)
shall be amended, extended or renewed except in accordance with the terms
hereof. Notwithstanding the foregoing, the Borrowers shall not be required to
pay any additional issuance fees with respect to the issuance of the Existing
Letters of Credit solely as a result of such letter of credit being converted
into a Letter of Credit hereunder, it being understood that the fronting,
participation and other fees set forth in Section 2.12(b) shall otherwise apply
to such Existing Letters of Credit.

SECTION 2.07 Funding of Borrowings. (a) Each Lender shall make each Loan to be
made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 2:00 p.m., Atlanta time, to the account of the
Administrative Agent most recently designated by it for such purpose by notice
to the Lenders in an amount equal to such Lender’s Applicable Percentage;
provided that, Swingline Loans shall be made as provided in Section 2.05. The
Administrative Agent will make such Loans available to the Borrower
Representative by promptly crediting the amounts so received, in like funds, to
the Funding Account(s); provided that ABR Revolving Loans made to finance the
reimbursement of (i) an LC Disbursement as provided in Section 2.06(e) shall be
remitted by the Administrative Agent to the applicable Issuing Bank and (ii) a
Protective Advance shall be retained by the Administrative Agent.

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

SECTION 2.08 Interest Elections. (a) Each Revolving Borrowing initially shall be
of the Type specified in the applicable Borrowing Request and, in the case of a
Eurodollar Revolving Borrowing,

 

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

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

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

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

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

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

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

If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrowers shall be deemed to have
selected an Interest Period of 30 days’ duration.

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

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

 

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SECTION 2.09 Termination and Reduction of Commitments; Increase in Commitments.
(a) Unless previously terminated, the Commitments shall terminate on the
Maturity Date.

(b) The Borrowers may at any time terminate the Commitments upon (i) the payment
in full of all outstanding Loans, together with accrued and unpaid interest
thereon and on any Letters of Credit, (ii) the cancellation and return of all
outstanding Letters of Credit (or alternatively, with respect to each such
Letter of Credit, the furnishing to the Administrative Agent of a cash deposit
(or at the discretion of the Administrative Agent a back up standby letter of
credit satisfactory to the Administrative Agent) equal to 103% of the LC
Exposure as of such date), (iii) the payment in full of the accrued and unpaid
fees, and (iv) the payment in full of all reimbursable expenses and other
Obligations then due and owing together with accrued and unpaid interest
thereon.

(c) The Borrowers may from time to time reduce the Commitments; provided that
(i) each reduction of the Commitments shall be in an amount that is an integral
multiple of $5,000,000 and not less than $25,000,000 and (ii) the Borrowers
shall not reduce the Commitments if, after giving effect to any concurrent
prepayment of the Revolving Loans in accordance with Section 2.11, the Aggregate
Credit Exposure would exceed the lesser of the Commitments and the Borrowing
Base.

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

(e) The Borrowers shall have the right to increase the Commitments by obtaining
additional Commitments, either from one or more of the Lenders or another
lending institution; provided that (i) any such request for an increase shall be
in a minimum amount of $25,000,000, (ii) the Borrower Representative, on behalf
of the Borrowers, shall have the right to increase the Commitments on no more
than four occasions, (iii) no existing Lender shall be obligated to provide any
portion of such increase (any decision to increase being in such Lender’s sole
discretion), (iv) the Administrative Agent and each Issuing Bank has approved
the identity of any such new Lender, such approval not to be unreasonably
withheld, (iv) any such new Lender assumes all of the rights and obligations of
a “Lender” hereunder, (v) any such additional Commitments shall be on the same
terms and conditions as the other existing Commitments (except as to fees agreed
to among the Administrative Agent, the Borrowers and the Lenders providing such
additional Commitments), (vi) the procedure described in Section 2.09(f) has
been satisfied, (vii) such increase is permitted by the Term Loan Documents and
the Holdings Notes Documents assuming that the increased Commitments are fully
drawn (and, if such increase is permitted under the Term Loan Documents or the
Holdings Notes Documents pursuant to a “borrowing base” calculation thereunder
rather than a dollar or ratio based basket, (A) the Administrative Agent may
require delivery of periodic certificates calculating such borrowing base under
the Term Loan Documents and/or the Holdings Notes Documents and (B) the
Borrowing Base under this Agreement may not exceed the lowest applicable
borrowing base under the Term Loan Documents and the Holdings Notes Documents),
(viii) no Default or Event of Default shall exist at the time of and after
giving effect to any such increase, and (ix) Borrowers shall pay all fees and
expenses incurred in connection with such increase (including any breakage
costs).

 

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(f) Any amendment hereto for such an increase or addition shall be in form and
substance reasonably satisfactory to the Administrative Agent and shall only
require the written signatures of the Administrative Agent, the Borrowers and
the Lender(s) being added or increasing their Commitment, subject only to the
approval of Required Lenders if any such increase would cause the Commitments to
exceed $375,000,000. As a condition precedent to such an increase, the Borrower
Representative shall deliver to the Administrative Agent (i) a certificate of
each Loan Party signed by an authorized 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 III and the other Loan
Documents are true and correct in all material respects 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 (2) no Default exists and (ii) such legal opinions and other
documents as may be reasonably requested by the Administrative Agent.

(g) Within a reasonable time after the effective date of any increase, the
Administrative Agent shall, and is hereby authorized and directed to, revise the
Commitment Schedule to reflect such increase and shall distribute such revised
Commitment Schedule to each of the Lenders and the Borrowers, whereupon such
revised Commitment Schedule shall replace the old Commitment Schedule and become
part of this Agreement. On the Business Day following any such increase, all
outstanding ABR Borrowings shall be reallocated among the Lenders (including any
newly added Lenders) in accordance with the Lenders’ respective revised
Applicable Percentages. Eurodollar Advances shall not be reallocated among the
Lenders prior to the expiration of the applicable Interest Period in effect at
the time of any such increase. All Availability dollar thresholds will be
automatically adjusted ratably in accordance with any increase of the
Commitments pursuant to this Section 2.09.

SECTION 2.10 Repayment of Loans; Evidence of Debt. (a) The Borrowers hereby
jointly, severally and unconditionally promise to pay (i) to the Administrative
Agent for the account of each Lender the then unpaid principal amount of each
Loan on the Maturity Date, and (ii) to the Administrative Agent the then unpaid
amount of each Protective Advance on the earlier of the Maturity Date and demand
by the Administrative Agent.

(b) At all times that a Dominion Trigger Period is in effect, on each Business
Day, the Administrative Agent shall apply all funds deposited in the Collateral
Deposit Accounts on such Business Day or the immediately preceding Business Day
(at the discretion of the Administrative Agent, whether or not immediately
available) first to prepay any Protective Advances that may be outstanding, pro
rata, second to prepay the Loans (including Swingline Loans) pro rata and third
to cash collateralize outstanding LC Exposure.

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

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

 

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

(f) Any Lender may request that Loans made by it be evidenced by a promissory
note. In such event, the Borrowers shall prepare, execute and deliver to such
Lender a promissory note payable to such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) and in a form approved by the
Administrative Agent. Thereafter, the Loans evidenced by such promissory note
and interest thereon shall at all times (including after assignment pursuant to
Section 9.04) be represented by one or more promissory notes in such form
payable to the payee named therein (or, if such promissory note is a registered
note, to such payee and its registered assigns).

SECTION2.11 Prepayment of Loans. (a) The Borrowers shall have the right at any
time and from time to time to prepay any Borrowing in whole or in part, subject
to prior notice in accordance with paragraph (d) of this Section.

(b) In the event and on such occasion that the Aggregate Credit Exposure exceeds
the lesser of (A) the Commitments or (B) the Borrowing Base, the Borrowers shall
prepay the Revolving Loans, LC Exposure and/or Swingline Loans in an aggregate
amount equal to such excess.

(c) During a Dominion Trigger Period, in the event and on each occasion that any
Net Proceeds are received by or on behalf of any Loan Party in respect of a
disposition or a casualty or condemnation event relating to Collateral included
in the Borrowing Base, the Borrowers shall, within one Business Day after such
Net Proceeds are received, prepay the Obligations in an amount equal to 100% of
such Net Proceeds. A prepayment pursuant to this clause (c) shall be applied
first to repay any Protective Advances that may be outstanding, pro rata, second
to repay the Loans (including Swingline Loans) pro rata and third to cash
collateral outstanding LC Exposure.

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

SECTION 2.12 Fees. (a) The Borrowers agree to pay to the Administrative Agent
for the account of the Revolving Lenders a commitment fee, which shall accrue at
the Applicable Commitment Fee Rate on the average daily amount of the Available
Commitment during the period from and including the Effective Date to but
excluding the date on which the Revolving Lenders’ Commitments terminate.

 

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Accrued commitment fees shall be payable quarterly in arrears on the first day
of January, April, July and October and on the date on which the Commitments
terminate, commencing on the first such date to occur after the date hereof. All
commitment fees shall be computed on the basis of a year of 360 days and shall
be payable for the actual number of days elapsed.

(b) The Borrowers agree to pay (i) to the Administrative Agent for the account
of each Revolving Lender a participation fee with respect to its participations
in Letters of Credit, which shall accrue at the same Applicable Rate used to
determine the interest rate applicable to Eurodollar Revolving Loans on the
average daily amount of such Lender’s LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the date on which
such Lender’s Commitment terminates and the date on which such Revolving Lender
ceases to have any LC Exposure, and (ii) to the applicable Issuing Bank a
fronting fee, which shall accrue at the rate of 0.125% per annum on the average
daily amount of the LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date of termination of the
Commitments and the date on which there ceases to be any LC Exposure, as well as
the applicable Issuing Bank’s standard fees with respect to the issuance,
amendment, renewal or extension of any Letter of Credit or processing of
drawings thereunder. Participation fees and fronting fees accrued through and
including the last day of each calendar quarter shall be payable on the first
day of each calendar quarter following such last day, commencing on the first
such date to occur after the Effective Date; provided that all such fees shall
be payable on the date on which the Commitments terminate and any such fees
accruing after the date on which the Commitments terminate shall be payable on
demand. Any other fees payable to any Issuing Bank pursuant to this paragraph
shall be payable within 10 days after demand. All participation fees and
fronting fees shall be computed on the basis of a year of 360 days and shall be
payable for the actual number of days elapsed.

(c) The Borrowers agree to pay to the Administrative Agent, for its own account,
fees payable in the amounts and at the times separately agreed upon between the
Borrowers and the Administrative Agent.

(d) All fees payable hereunder shall be paid on the dates due, in immediately
available funds, to the Administrative Agent (or to the applicable Issuing Bank,
in the case of fees payable to it) for distribution, in the case of commitment
fees and participation fees, to the Lenders. Fees paid shall not be refundable
under any circumstances.

SECTION 2.13 Interest . (a) The Loans comprising each ABR Borrowing (including
each Swingline Loan) shall bear interest at the Alternate Base Rate plus the
Applicable Rate.

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

(c) Each Protective Advance shall bear interest at the Alternate Base Rate plus
the Applicable Rate for Revolving Loans plus 2%.

(d) Notwithstanding the foregoing, if any principal of or interest on any Loan
or any fee or other amount payable by the Borrowers hereunder is not paid when
due, whether at stated maturity, upon acceleration or otherwise, the
Administrative Agent or the Required Lenders may, at their option, by notice to
the Borrower Representative (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 9.02 requiring the
consent of “each Lender affected thereby” for reductions in interest rates),
declare that (i) all overdue principal of the Loans shall bear interest at 2%
plus the rate otherwise applicable to such Loans as provided in the preceding
paragraphs of this Section or (ii) in the case of any other amount outstanding
hereunder, such amount shall accrue at 2% plus the rate applicable to such fee
or other obligation as provided hereunder.

 

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

(f) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the Alternate Base Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed. The Alternate
Base Rate or LIBOR, as applicable, shall be determined by the Administrative
Agent, and such determination shall be conclusive absent manifest error. If, for
any reason (including inaccurate reporting on financial statements, a Borrowing
Base Certificate or a Compliance Certificate), it is determined that a higher
Applicable Rate should have applied to a period than was actually applied, then
the proper rate shall be applied retroactively and the Borrowers shall
immediately pay an amount equal to the difference between the amount of interest
and fees that would have accrued using the proper rate and the amount actually
paid.

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

(a) the Administrative Agent determines (which determination shall be conclusive
absent manifest error) that adequate and reasonable means do not exist for
ascertaining LIBOR for such Interest Period; or

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

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

SECTION 2.15 Increased Costs. (a) 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 LIBOR) or any Issuing Bank;

 

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(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes,
(B) Excluded Taxes described in clauses (b) through (d) of the definition
thereof and (C) Connection Taxes that are imposed on or measured by net income
(however denominated) or that are franchise taxes or branch profits taxes) that
are imposed on or measured by such Recipient’s loans, loan principal, letters of
credit, commitments, or other obligations, or its deposits, reserves, other
liabilities or capital attributable thereto; or

(iii) impose on any Lender or any Issuing Bank or the London interbank market
any other condition, cost or expense (other than Taxes) affecting this Agreement
or 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 the
Administrative Agent, such Lender or such Issuing Bank of making, converting to,
continuing or maintaining (A) in the case of clauses (i) and (iii), any
Eurodollar Loan or any Alternate Base Rate Loan determined by reference to LIBOR
and (B) in the case of clause (ii), any Loan, or of maintaining its obligation
to make any such Loan, or to increase the cost to the Administrative Agent, such
Lender or such Issuing Bank of participating in, issuing or maintaining any
Letter of Credit (or of maintaining its obligation to participate in or to issue
any Letter of Credit), or to reduce the amount of any sum received or receivable
by the Administrative Agent, such Lender or such Issuing Bank (whether of
principal, interest or any other amount) then, upon request of the
Administrative Agent, such Lender or such Issuing Bank, the Borrowers will pay
to such Person such additional amount or amounts as will compensate such Person
for such additional costs incurred or reduction suffered.

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

(c) A certificate of a Lender or an Issuing Bank setting forth the amount
necessary to compensate such Lender or such Issuing Bank or its holding company,
as the case may be, as specified in paragraph (a) or (b) of this Section,
together with a reasonably detailed calculation thereof and the assumptions upon
which such calculation was based, shall be delivered to the Borrower
Representative and shall be conclusive absent manifest error. The Borrowers
shall pay such Lender or such Issuing Bank, as the case may be, the amount shown
as due on any such certificate within 10 days after receipt thereof.

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

 

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SECTION 2.16 Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default),
(b) the conversion of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under
Section 2.09(d) and is revoked in accordance therewith), or (d) the assignment
of any Eurodollar Loan other than on the last day of the Interest Period
applicable thereto as a result of a request by the Borrower Representative
pursuant to Section 2.19, then, in any such event, the Borrowers shall
compensate each Lender for the loss, cost and expense attributable to such event
(which shall not include any lost profit or margin). In the case of a Eurodollar
Loan, such loss, cost or expense to any Lender shall be deemed to include an
amount determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at LIBOR that would have been applicable to such Loan, for
the period from the date of such event to the last day of the then current
Interest Period therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such
Loan), over (ii) the amount of interest which would accrue on such principal
amount for such period at the interest rate which such Lender would bid were it
to bid, at the commencement of such period, for dollar deposits of a comparable
amount and period from other banks in the eurodollar market. A certificate of
any Lender setting forth any amount or amounts that such Lender is entitled to
receive pursuant to this Section shall be delivered to the Borrower
Representative and shall be conclusive absent manifest error. The Borrowers
shall pay such Lender the amount shown as due on any such certificate within 10
Business Days after receipt thereof.

SECTION 2.17 Taxes. (a) Any and all payments by or on account of any obligation
of the Borrowers hereunder shall be made free and clear of and without deduction
or withholding for any Taxes except as required by Requirement of Law. If any
Requirement of Law (as determined in the good faith discretion of an applicable
Withholding Agent) requires the deduction or withholding of any Tax from such
payment by a Withholding Agent, then the applicable Withholding Agent shall be
entitled to make such deduction or withholding and shall timely pay the full
amount deducted or withheld to the relevant Governmental Authority in accordance
with applicable law and, if such Tax is an Indemnified Tax or Other Tax, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions or withholdings (including deductions or withholdings
applicable to additional sums payable under this Section) the Administrative
Agent, Lender or an Issuing Bank (as the case may be) receives an amount equal
to the sum it would have received had no such deductions or withholdings been
made.

(b) Without duplication, in addition, the Borrowers shall pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law, or at the
option of the Administrative Agent timely reimburse it for the payment of, any
Other Taxes.

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

 

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(d) Each Lender and each Issuing Bank shall indemnify the Borrowers and the
Administrative Agent, within 10 days after written demand therefor, against any
and all Taxes and any and all related losses, claims, liabilities and reasonable
expenses (including the fees, charges and disbursements of any counsel for the
Borrowers or the Administrative Agent and including Taxes imposed or asserted on
or attributable to amounts payable under this Section 2.17(d)) incurred by or
asserted against the Borrowers or the Administrative Agent by any Governmental
Authority as a result of the failure by such Lender or such Issuing Bank, as the
case may be, to deliver, or as a result of the inaccuracy, inadequacy or
deficiency of, any documentation required to be delivered to the Borrowers or
the Administrative Agent pursuant to Section 2.17(f). Each Lender and each
Issuing Bank hereby authorizes the Administrative Agent to set off and apply any
and all amounts at any time owing to such Lender or such Issuing Bank, as the
case may be, under this Agreement or any other Loan Document against any amount
due to the Administrative Agent under this Section 2.17(d).

(e) As soon as practicable after any payment of Indemnified Taxes or Other Taxes
by the Borrowers to a Governmental Authority, the Borrower Representative 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.

(f) Forms.

(i) Any Lender that is a United States person (within the meaning of
Section 7701(a)(30) of the Code) shall deliver to the Borrowers and the
Administrative Agent on or prior to the date on which such Lender becomes a
party to this Agreement (and from time to time thereafter upon the reasonable
request of the Borrowers or the Administrative Agent), executed originals of
U.S. Internal Revenue Service Form W-9 certifying that such Lender is exempt
from U.S. federal backup withholding Tax.

(ii) Each Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrowers and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) on or before the date it becomes a party to this Agreement (or, in
the case of any Participant, on or before the date such Participant purchases
the related participation), which ever of the following is applicable:

(1) in the case of a Foreign Lender claiming the benefits of an income tax
treaty to which the United States is a party (x) with respect to payments of
interest under any Loan Document, executed originals of IRS Form W-8BEN
establishing an exemption from, or reduction of, U.S. federal withholding Tax
pursuant to the “interest” article of such tax treaty and (y) with respect to
any other applicable payments under any Loan Document, IRS Form W-8BEN
establishing an exemption from, or reduction of, U.S. federal withholding Tax
pursuant to the “business profits” or “other income” article of such tax treaty;

(2) executed originals of IRS Form W-8ECI;

 

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(3) 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
substantially in the form of Exhibit G-1 to the effect that such Foreign Lender
is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10
percent shareholder” of the Borrowers within the meaning of Section 881(c)(3)(B)
of the Code, or a “controlled foreign corporation” described in
Section 881(c)(3)(C) of the Code (a “U.S. Tax Certificate”) and (y) executed
originals of IRS Form W-8BEN; and

(4) to the extent a Foreign Lender is not the beneficial owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, a
U.S. Tax Compliance Certificate substantially in the form of Exhibit G-2 or
Exhibit G-3, IRS Form W-9, and/or other certification documents from each
beneficial owner, as applicable; provided that if the Foreign Lender is a
partnership and one or more direct or indirect partners of such Foreign Lender
are claiming the portfolio interest exemption, such Foreign Lender may provide a
U.S. Tax Certificate substantially in the form of Exhibit G-4 on behalf of each
such direct and indirect partner.

In addition, upon request of the Borrowers, each Foreign Lender shall deliver
such forms promptly upon the obsolescence, expiration, or invalidity of any form
previously delivered by such Foreign Lender. Each Foreign Lender shall promptly
notify the Borrowers at any time it determines that it is no longer in a
position to provide any previously delivered certificate to the Borrowers (or
any other form of certification adopted by the U.S. taxing authorities for such
purpose).

(iii) Any Lender that is entitled to an exemption from or reduction of non-U.S.
withholding tax under the law of the jurisdiction in which the applicable
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law or reasonably requested by the Borrower, such properly completed and
executed documentation prescribed by applicable law or reasonably requested by
the Borrower as will permit such payments to be made without withholding or at a
reduced rate; provided, the completion, execution and submission of such
documentation shall not be required if in the Lender’s reasonable judgment such
completion, execution or submission would subject such Lender to any material
unreimbursed cost or expense or would materially prejudice the legal or
commercial position of such Lender.

(iv) If a payment made to a Lender under any Loan Document would be subject to
U.S. Federal withholding Tax imposed by FATCA if such Lender fails to comply
with the applicable reporting requirements of FATCA (including those contained
in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall
deliver to the Borrowers and the Administrative Agent at the time or times
prescribed by law and at such time or times reasonably requested by the Borrower
or the Administrative Agent such documentation prescribed by applicable law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrower or the
Administrative Agent as may be necessary for the Borrower and the Administrative
Agent to comply with their obligations under FATCA and to determine

 

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that such Lender has complied with such Lender’s obligations under FATCA or to
determine the amount to deduct and withhold from such payment. Solely for
purposes of this clause (iv), “FATCA” shall include any amendments made to FATCA
after the date of this Agreement.

(g) If the Administrative Agent or a Lender determines, in its sole discretion,
that it has received a refund of Indemnified 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 2.17, it shall promptly
pay over such refund to the Borrowers (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrowers under this
Section 2.17 with respect to the Indemnified Taxes or Other Taxes giving rise to
such refund), net of all out-of-pocket expenses of the Administrative Agent or
such Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided, that the
Borrowers, upon the request of the Administrative Agent or such Lender, agrees
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 or such Lender in the event the Administrative Agent or
such Lender is required to repay such refund to such Governmental Authority.
Notwithstanding anything to the contrary in this Section 2.17(g), in no event
will the Administrative Agent or any Lender be required to pay any amount to any
Borrower pursuant to this Section 2.17(g) the payment of which would place such
Administrative Agent or Lender in a less favorable net after-Tax position than
the Administrative Agent or Lender would have been in if the indemnification
payments or additional amounts with respect to such Tax had never been paid.
This Section 2.17(g) shall not be construed to require the Administrative Agent
or any Lender to make available its tax returns (or any other information
relating to its taxes which it deems confidential) to the Borrowers or any other
Person.

(h) For purposes of Section 2.17, the term “Lender” includes any Issuing Bank
and the term “Requirement of Law” includes FATCA.

SECTION 2.18 Payments Generally; Allocation of Proceeds; Sharing of Set-offs.
(a) The Borrowers shall make each payment required to be made by them hereunder
(whether of principal, interest, fees or reimbursement of LC Disbursements, or
of amounts payable under Section 2.15, 2.16 or 2.17, or otherwise) prior to 2:00
p.m., Atlanta time, on the date when due, in immediately available funds,
without set-off or counterclaim. Any amounts received after such time on any
date may, in the discretion of the Administrative Agent, be deemed to have been
received on the next succeeding Business Day for purposes of calculating
interest thereon. All such payments shall be made to the Administrative Agent at
its offices at 300 Galleria Parkway, Suite 800, Atlanta, Georgia, except
payments to be made directly to an Issuing Bank or Swingline Lender as expressly
provided herein and except that payments pursuant to Sections 2.15, 2.16, 2.17
and 9.03 shall be made directly to the Persons entitled thereto. The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.

(b) Any proceeds of Collateral received by the Administrative Agent (i) not
constituting any of (A) a specific payment of principal, interest, fees or other
sum payable under the Loan Documents (which shall be applied as specified by the
Borrowers), (B) a mandatory prepayment (which shall be applied in accordance
with Section 2.11) or (C) amounts to be applied from the Collateral Deposit
Accounts when full cash dominion is in effect (which shall be applied in
accordance with Section 2.10(b)) or (ii) after an Event of Default has occurred
and is continuing and the Administrative Agent so elects or the Required Lenders
so direct, such funds shall be applied ratably first, to pay any fees,
indemnities, or

 

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expense reimbursements including amounts then due to the Administrative Agent
and the applicable Issuing Banks from the Borrowers (other than in connection
with Banking Services Obligations or Swap Obligations), second, to pay any fees,
indemnities or expense reimbursements then due to the Lenders from the Borrowers
(other than in connection with Banking Services Obligations or Swap
Obligations), third, to pay interest due in respect of Protective Advances,
fourth, to pay the principal of Protective Advances, fifth, to pay interest then
due and payable on the Loans (other than Protective Advances) ratably, sixth, to
prepay principal on the Loans (other than Protective Advances) and unreimbursed
LC Disbursements ratably, seventh, to pay an amount to the Administrative Agent
equal to one hundred three percent (103%) of the aggregate undrawn face amount
of all outstanding Letters of Credit and the aggregate amount of any unpaid LC
Disbursements, to be held as cash collateral for such Obligations, eighth, to
payment of any amounts owing with respect to Banking Services Obligations and
with respect to Swap Obligations owed to Lenders, Lead Arrangers or their
respective Affiliates, ninth, to payment of any amounts owing with respect to
Swap Obligations owed to Persons that were Lenders or Lead Arrangers at the time
of entry into such Swap Obligations but which are no longer Lenders or Lead
Arrangers at the time of such payment, or their Affiliates and tenth, to the
payment of any other Secured Obligation due to the Administrative Agent or any
Secured Party by the Borrowers. Notwithstanding anything to the contrary
contained in this Agreement, unless so directed by the Borrower Representative,
or unless a Default is in existence, neither the Administrative Agent nor any
Lender shall apply any payment which it receives to any Eurodollar Loan, except
(a) on the expiration date of the Interest Period applicable to any such
Eurodollar Loan or (b) in the event, and only to the extent, that there are no
outstanding ABR Loans and, in any such event, the Borrowers shall pay the break
funding payment required in accordance with Section 2.16. The Administrative
Agent and the Lenders shall have the continuing and exclusive right to apply and
reverse and reapply any and all such proceeds and payments to any portion of the
Secured Obligations.

(c) At the election of the Administrative Agent, (i) all payments of principal,
interest, LC Disbursements, fees, premiums, reimbursable expenses (including,
without limitation, all reimbursement for fees and expenses pursuant to
Section 9.03), and other sums payable under the Loan Documents and (ii) all
payments of any check, ACH or electronic debit, or other payment item requested
by the Borrowers from any controlled disbursement account with the
Administrative Agent or any of its Affiliates at a time when there are
insufficient funds to cover such payment, may be paid from the proceeds of
Borrowings made hereunder whether made following a request by the Borrower
Representative pursuant to Section 2.03 or a deemed request as provided in this
Section or may be deducted from any deposit account of any Borrower maintained
with the Administrative Agent. Each Borrower hereby irrevocably authorizes
(i) the Administrative Agent to make a Borrowing for the purpose of paying each
payment of (A) principal, interest and fees as it becomes due hereunder or any
other amount due under the Loan Documents and (B) any check, ACH or electronic
debit, or other payment item presented for payment from any controlled
disbursement account of any Borrower with the Administrative Agent or any of its
Affiliates at a time when there are insufficient funds to cover such payment and
in each case, agrees that all such amounts charged shall constitute Loans
(including Swingline Loans, but such a Borrowing may only constitute a
Protective Advance if it is to reimburse costs, fees and expenses as described
in Section 9.03) and that all such Borrowings shall be deemed to have been
requested pursuant to Sections 2.03, 2.04 or 2.05, as applicable and (ii) the
Administrative Agent to charge any deposit account of any Borrower maintained
with the Administrative Agent for each payment of (A) principal, interest and
fees as it becomes due hereunder or any other amount due under the Loan
Documents and (B) any check, ACH or electronic debit, or other payment item
presented for payment from any controlled disbursement account of any Borrower
with the Administrative Agent or any of its Affiliates at a time when there are
insufficient funds to cover such payment.

(d) If any Lender shall, by exercising any right of set-off or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Loans or participations in LC

 

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

(e) Unless the Administrative Agent shall have received notice from the Borrower
Representative prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or any Issuing Bank
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 applicable Issuing Bank, 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 each applicable Issuing Bank, as the case may be, severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender or such Issuing Bank with interest thereon, for each
day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation.

(f) If any Lender shall fail to make any payment required to be made by it
hereunder, then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), (i) apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender’s
obligations hereunder until all such unsatisfied obligations are fully paid
and/or (ii) hold any such amounts in a segregated account as cash collateral
for, and apply any such amounts to, any future funding obligations of such
Lender hereunder; application of amounts pursuant to (i) and (ii) above shall be
made in such order as may be determined by the Administrative Agent in its
discretion.

SECTION 2.19 Mitigation Obligations; Replacement of Lenders.

(a) If any Lender requests compensation under Section 2.15, or if the Borrowers
are required to pay any Indemnified Taxes (excluding Other Taxes) or additional
amounts to any Lender or any Governmental Authority for the account of any
Lender pursuant to Section 2.17, then such Lender shall use reasonable efforts
to designate a different lending office for funding or booking its Loans or
Letters of Credit 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 or to be withheld pursuant to Section 2.15 or 2.17, as the case may be,
in the future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrowers
hereby agree to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

 

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(b) If any Lender requests compensation under Section 2.15, or if the Borrowers
are required to pay any Indemnified Taxes (excluding Other Taxes) or additional
amounts to any Lender or any Governmental Authority for the account of any
Lender pursuant to Section 2.17, or if any Lender becomes a Defaulting 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 Section 9.04), all its interests, rights and obligations under this Agreement
to an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) the Borrowers
shall have received the prior written consent of the Administrative Agent (and
if a Commitment is being assigned, each Issuing Bank), which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Loans and participations in LC
Disbursements and Swingline Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrowers (in
the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.15 or payments required
to be made pursuant to Section 2.17, such assignment will result in a reduction
in such compensation or payments. A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrowers to require
such assignment and delegation cease to apply.

SECTION 2.20 Defaulting Lenders. Notwithstanding any provision of this Agreement
to the contrary, if any Lender becomes a Defaulting Lender, then the following
provisions shall apply for so long as such Lender is a Defaulting Lender:

(a) fees shall cease to accrue on the unfunded portion of the Commitment of such
Defaulting Lender pursuant to Section 2.12(a);

(b) the Commitment and Credit Exposure of such Defaulting Lender shall not be
included in determining whether all Lenders, the Required Lenders or the
Supermajority Lenders have taken or may take any action hereunder (including any
consent to any amendment or waiver pursuant to Section 9.02), provided that
(i) any waiver, amendment or modification requiring the consent of all Lenders
or each affected Lender that by its terms affects such Defaulting Lender more
adversely than other affected Lenders shall require the consent of such
Defaulting Lender and (ii) any waiver, amendment or modification specified in
clauses (i), (ii) and (iii) of the first proviso in Section 9.02(b) affecting a
Defaulting Lender shall require the consent of such Defaulting Lender;

(c) if any Swingline Exposure or LC Exposure exists at the time a Lender becomes
a Defaulting Lender then:

(i) all or any part of such Swingline Exposure and LC Exposure shall be
reallocated among the non-Defaulting Lenders in accordance with their respective
Applicable Percentages but only to the extent (x) the sum of all non-Defaulting
Lenders’ Credit Exposures and such Defaulting Lender’s Swingline Exposure and LC
Exposure does not exceed the total of all non-Defaulting Lenders’ Commitments,
(y) the conditions set forth in Section 4.02 are satisfied at such time and
(z) after giving effect thereto, no Lender’s Credit Exposure would exceed its
Commitment; and

(ii) if the reallocation described in clause (i) above cannot, or can only
partially, be effected, the Borrowers shall within one Business Day following
notice by the Administrative Agent (x) first, prepay such Defaulting Lender’s
Swingline Exposure and (y) second, cash collateralize such Defaulting Lender’s
LC Exposure (after giving effect to any partial reallocation pursuant to clause
(i) above) in accordance with the procedures set forth in Section 2.06(j) for so
long as such LC Exposure is outstanding;

 

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(iii) if the Borrowers cash collateralize any portion of such Defaulting
Lender’s LC Exposure pursuant to Section 2.20(c), the Borrowers shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 2.12(b)
with respect to such Defaulting Lender’s LC Exposure during the period such
Defaulting Lender’s LC Exposure is cash collateralized;

(iv) if the LC Exposure of the non-Defaulting Lender is reallocated pursuant to
Section 2.20(c), then the fees payable to the Lenders pursuant to
Section 2.12(a) and Section 2.12(b) shall be adjusted in accordance with such
non-Defaulting Lenders’ Applicable Percentages; or

(v) if any Defaulting Lender’s LC Exposure is neither cash collateralized nor
reallocated pursuant to Section 2.20(c), then, without prejudice to any rights
or remedies of any Issuing Bank or any Lender hereunder, all facility fees that
otherwise would have been payable to such Defaulting Lender (solely with respect
to the portion of such Defaulting Lender’s Commitment that was utilized by such
LC Exposure) and Letter of Credit fees payable under Section 2.12(b) with
respect to such Defaulting Lender’s LC Exposure shall be payable to the
applicable Issuing Bank until such LC Exposure is cash collateralized and/or
reallocated;

(d) no Issuing Bank shall be required to issue, amend or increase any Letter of
Credit, unless it is satisfied that the related exposure will be 100% covered by
the Commitments of the non-Defaulting Lenders and/or cash collateral will be
provided by the Borrowers in accordance with Section 2.20(c), and participating
interests in any such newly issued or increased Letter of Credit or newly made
Swingline Loan shall be allocated among non-Defaulting Lenders in a manner
consistent with Section 2.20(c)(i) (and Defaulting Lenders shall not participate
therein); and

(e) in the event and on the date that each of the Administrative Agent, the
Borrowers, each Issuing Bank and the Swingline Lender agrees that a Defaulting
Lender has adequately remedied all matters that caused such Lender to be a
Defaulting Lender, then the Swingline Exposure and LC Exposure of the other
Lenders shall be readjusted to reflect the inclusion of such Lender’s Commitment
and on such date such Lender shall purchase at par such of the Loans of the
other Lenders (other than Swingline Loans) as the Administrative Agent shall
determine may be necessary in order for such Lender to hold such Loans in
accordance with its Applicable Percentage.

SECTION 2.21 Returned Payments. If after receipt of any payment which is applied
to the payment of all or any part of the Obligations, the Administrative Agent
or any Lender is for any reason compelled to surrender such payment or proceeds
to any Person because such payment or application of proceeds is invalidated,
declared fraudulent, set aside, determined to be void or voidable as a
preference, impermissible setoff, or a diversion of trust funds, or for any
other reason, then the Obligations or part thereof intended to be satisfied
shall be revived and continued and this Agreement shall continue in full force
as if such payment or proceeds had not been received by the Administrative Agent
or such Lender. The provisions of this Section 2.21 shall be and remain
effective notwithstanding any contrary action which may have been taken by the
Administrative Agent or any Lender in reliance upon such payment or application
of proceeds. The provisions of this Section 2.21 shall survive the termination
of this Agreement.

 

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SECTION 2.22 Limitation on Permitted Discretion.

(a) The Administrative Agent shall have the right to establish, modify or
eliminate Reserves against Eligible Accounts and Eligible Inventory from time to
time in its Permitted Discretion. In addition, the Administrative Agent reserves
the right, at any time and from time to time after the Effective Date, to adjust
any of the applicable criteria, to establish new criteria and to adjust advance
rates with respect to Eligible Accounts and Eligible Inventory, in its Permitted
Discretion, subject to Section 9.02.

(b) Notwithstanding the foregoing or any provision in this Agreement to the
contrary, circumstances, conditions, events or contingencies arising prior to
the Effective Date and disclosed to the Administrative Agent prior to the
Effective Date shall not be the basis for any establishment or modification of
Reserves, eligibility criteria or advance rates unless (i) in the case of
Reserves and eligibility criteria, such category of Reserves or eligibility
criteria were established on the Effective Date (which may include Reserves and
eligibility criteria set forth in the initial Borrowing Base Certificate) or
(ii) such circumstances, conditions, events or contingencies shall have changed
since the Effective Date (other than with respect to the Banking Services
Reserve or any reserve for Swap Obligations).

(c) Any exercise of Permitted Discretion with respect to Reserves (other than
with respect to the Banking Services Reserve or any reserve for Swap
Obligations) shall be based on a good faith reasonable determination of the
Administrative Agent that (i) the circumstances, conditions, events or
contingencies giving rise thereto will or reasonably could be expected to
adversely affect the value of the Eligible Accounts or Eligible Inventory in the
Borrowing Base, the enforceability or priority of the Administrative Agent’s
Liens thereon or the amount the Secured Parties would likely receive in the
liquidation of Eligible Accounts or Eligible Inventory in the Borrowing Base and
(ii) the proposed action to be taken by the Administrative Agent to mitigate the
effects described in clause (i) (including the amount of any Reserves) bears a
reasonable relationship to the circumstance, condition, event or other
contingency that is the basis therefor.

(d) Upon delivery of notice to the Borrower Representative by the Administrative
Agent of its intent to establish or increase Reserves, the Administrative Agent
shall be available to discuss the proposed Reserves or increase, and Borrowers
may take such action as may be required so that the circumstance, condition,
event or other contingency that is the basis for such Reserves or increase no
longer exists, in a manner and to the extent reasonably satisfactory to the
Administrative Agent in the exercise of its Permitted Discretion. In no event
shall such notice and opportunity limit the right of the Administrative Agent to
establish or change such Reserves, unless the Administrative Agent shall have
determined in its Permitted Discretion that the circumstance, condition, event
or other contingency that is the basis for such new Reserves or such change no
longer exists or has otherwise been adequately addressed by Borrowers.

(e) In the event that the event, condition or other matter giving rise to the
establishment of any Reserve shall cease to exist (unless the Administrative
Agent determines there is a reasonable prospect that such event, condition or
other matter will occur again within a reasonable period of time thereafter),
the Borrower Representative may request in writing that the Administrative Agent
discontinue the Reserve established pursuant to such event, condition or other
matter (and the Administrative Agent will have a reasonable period of time to
evaluate such request and will be available to discuss such request with the
Borrower Representative).

 

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

Each Loan Party represents and warrants to the Lenders on the Effective Date and
on each date a Loan is made or a Letter of Credit is issued, amended, renewed or
extended, that the following statements are true and correct in all material
respects; provided that any such representations and warranties that are
qualified as to “materiality” shall be true and correct in all respects;
provided further, that it is understood and agreed that the accuracy of the
following representations and warranties made on the Effective Date, other than
those specified in Section 4.01(s), shall not be a condition precedent to the
effectiveness of this Agreement or to the making of the initial Loans and the
issuance (or deemed issuance) of the initial Letters of Credit:

SECTION 3.01 Organization; Powers. Each of the Loan Parties and each of its
Restricted Subsidiaries is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, has all requisite power
and authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.

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

SECTION 3.03 Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except (i) such as have been obtained or
made and are in full force and effect, (ii) for filings necessary to perfect
Liens created pursuant to the Loan Documents, and (iii) such approvals,
authorizations or consents the failure of which to obtain or make could not
reasonably be expected to have a Material Adverse Effect, (b) will not violate
(i) the certificate or articles of incorporation or organization, by-laws,
operating, management or partnership agreement or other organizational documents
of any Loan Party or any of its Restricted Subsidiaries and (ii) any material
Requirement of Law applicable to any Loan Party or any of its Restricted
Subsidiaries, (c) will not violate or result in a default under the Term Loan
Agreement, the Holdings Notes Indenture or any other material indenture,
agreement or instrument binding upon any Loan Party or any of its Restricted
Subsidiaries or its assets, or give rise to a right thereunder to require any
payment to be made by any Loan Party or any of its Restricted Subsidiaries, and
(d) will not result in the creation or imposition of any Lien on any asset of
any Loan Party or any of its Restricted Subsidiaries, except Liens created
pursuant to the Loan Documents and Liens permitted under Section 6.02.

SECTION 3.04 Financial Condition; No Material Adverse Effect. (a) The Company
has heretofore furnished to the Lenders the consolidated balance sheet and
statements of income, stockholders equity and cash flows of Holdings (i) as of
and for the fiscal years ended December 25, 2009, December 31, 2010 and
December 30, 2011, reported on by Deloitte & Touche LLP, independent public
accountants, and (ii) as of and for (x) the fiscal quarter and the portion of
the fiscal year ended March 30, 2012, (y) the fiscal quarter and the portion of
the fiscal year ended June 29, 2012, and (z) if such date precedes the Effective
Date by at least 45 days, the fiscal quarter and the portion of the fiscal year
ended September 28, 2012, in each case certified by its chief financial officer.
Such financial statements present

 

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fairly, in all material respects, the financial position and results of
operations and cash flows of Holdings and its consolidated Restricted
Subsidiaries as of such dates and for such periods in accordance with GAAP,
subject to year-end audit adjustments and the absence of footnotes in the case
of the statements referred to in clause (ii) above.

(b) No event, change or condition has occurred that has had, or could reasonably
be expected to have, a Material Adverse Effect, since December 30, 2011.

SECTION 3.05 Properties. (a) As of the date of this Agreement, Schedule 3.05
sets forth the address of each parcel of real property that is owned or leased
by each Loan Party. Each of such leases and subleases is valid and enforceable
in accordance with its terms and is in full force and effect, and no default
(i) by any Loan Party to any such lease or sublease or (ii) to the knowledge of
the Loan Parties, by any other parties to any such lease or sublease exists,
except for defaults that could not reasonably be expected to have a Material
Adverse Effect. Each of the Loan Parties and its Restricted Subsidiaries has
good and indefeasible title to, or valid leasehold interests in, all its
material real and personal property, free of all Liens other than those
permitted by Section 6.02.

(b) Each Loan Party and its Restricted Subsidiaries owns, or is licensed to use,
all material trademarks, tradenames, copyrights, patents and other intellectual
property necessary to its business as currently conducted. A correct and
complete list of all trademark and patent registrations and filed applications
and all material copyright registrations and filed applications owned by each
Loan Party on the Effective Date is set forth on Schedule 3.05, and the use
thereof by the Loan Parties and its Restricted Subsidiaries does not infringe
upon the rights of any other Person, except as could not reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect. Except as
set forth on Schedule 3.05 hereof, the Loan Parties are not, as of the date of
this Agreement, bound by any material license agreement, licensing agreement or
similar arrangement as licensor pursuant to which they have licensed any rights
under any of their intellectual property to any Person other than Holdings and
its Restricted Subsidiaries.

SECTION 3.06 Litigation and Environmental Matters. (a) There are no actions,
suits or proceedings by or before any arbitrator or Governmental Authority
pending against or, to the knowledge of any Loan Party, threatened against or
affecting the Loan Parties or any of their Restricted Subsidiaries (i) as to
which there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters described in Part A of Schedule 3.06) or (ii) that involve this
Agreement or the Transactions (other than the Disclosed Matters described in
Part B of Schedule 3.06).

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

(c) Since the date of this Agreement, there has been no change in the status of
the Disclosed Matters that, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.

SECTION 3.07 Compliance with Laws and Agreements. Each Loan Party and its
Restricted Subsidiaries is in compliance with all Requirements of Law applicable
to it or its property and all

 

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indentures, agreements and other instruments binding upon it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. No Default has
occurred and is continuing.

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

SECTION 3.09 Taxes. Each Loan Party and its Restricted Subsidiaries has timely
filed or caused to be filed all federal, state and other material Tax returns
and reports required to have been filed and has paid or caused to be paid all
Taxes that are material in amount required to have been paid by it, except
(a) Taxes that are being contested in good faith by appropriate proceedings and
for which such Loan Party or such Restricted Subsidiary, as applicable, has set
aside on its books adequate reserves and (b) to the extent that the failure to
do so could not be expected to result in a Material Adverse Effect. No tax liens
(other than liens for current period Taxes not yet due and payable) have been
filed and no claims are being asserted with respect to any material amount of
such taxes.

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

SECTION 3.11 Disclosure. Each Borrower and Holdings have disclosed to the
Lenders all agreements, instruments and corporate or other restrictions to which
it or any Restricted Subsidiary is subject, and all other matters known to it,
that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect. None of the reports, financial statements,
certificates or other information furnished by or on behalf of any Loan Party to
the Administrative Agent or any Lender in connection with the negotiation of
this Agreement or any other Loan Document (as modified or supplemented by other
information so furnished), when taken as a whole, 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 Borrowers and Holdings represent only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time delivered and, if such projected financial information was delivered prior
to the Effective Date, as of the Effective Date, it being recognized by the
Lenders that such projections as to future events are not to be viewed as facts
and that actual results during the period or periods covered by any such
projections may materially differ from the projected results.

SECTION 3.12 Material Agreements. All material agreements and contracts to which
any Loan Party is a party or is bound as of the date of this Agreement are
either (a) filed as exhibits to, or incorporated by reference in, the reports of
Holdings that were filed with the SEC, prior to the Effective Date, or
(b) listed on Schedule 3.12. No Loan Party is in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in (i) any agreement or contract to which it is a party, except where
such default could not reasonably be expected to have a Material Adverse Effect,
or (ii) any agreement or instrument evidencing or governing Indebtedness in a
principal amount, individually or in the aggregate, in excess of $20,000,000.

 

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SECTION 3.13 Solvency. Immediately after the consummation of the Transactions to
occur on the Effective Date and on the date of each Borrowing and the date any
Letter of Credit is issued, amended, renewed or extended, (a) the sum of the
debt (including contingent liabilities) of Holdings and its Subsidiaries and the
Company and its Subsidiaries, in each case on a consolidated basis, will not
exceed the present fair saleable value of the present assets of Holdings and its
Subsidiaries and the Company and its Subsidiaries, respectively, on a
consolidated basis, (b) the present and fair saleable value of the assets of
Holdings and its Subsidiaries and the Company and its Subsidiaries, in each case
on a consolidated basis, is greater than the total amount that will be required
to pay the probable liabilities (including contingent liabilities) of Holdings
and its Subsidiaries and the Company and its Subsidiaries, respectively, in each
case as they become absolute and matured, (c) the capital of Holdings and its
Subsidiaries and the Company and its Subsidiaries, in each case on a
consolidated basis, is not unreasonably small in relation to their respective
businesses as contemplated on the date hereof, (d) Holdings and its Subsidiaries
and the Company and its Subsidiaries, in each case on a consolidated basis, have
not incurred and do not intend to incur, nor believe that they will incur,
debts, including current obligations, beyond their ability to pay such debts as
they become due (whether at maturity or otherwise), and (e) Holdings and its
Subsidiaries and the Company and its Subsidiaries, in each case on a
consolidated basis, are “solvent” within the meaning given to that term and
similar terms under applicable laws relating to fraudulent transfers and
conveyances.

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

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

SECTION 3.16 Security Interest in Collateral. The provisions of the Collateral
Documents create legal and valid Liens on all the Collateral in favor of the
Administrative Agent, for the benefit of the Administrative Agent and the
Secured Parties, and when the actions set forth in the Collateral Documents to
perfect such Liens are taken, such Liens will constitute perfected and
continuing Liens on the Collateral, securing the Secured Obligations,
enforceable against the applicable Loan Party and all third parties, and having
priority over all other Liens on the Collateral except (a) Permitted
Encumbrances, to the extent any such Permitted Encumbrances would have priority
over the Liens in favor of the Administrative Agent pursuant to any applicable
law or agreement, (b) Liens perfected only by possession (including possession
of any certificate of title) to the extent the Administrative Agent has not
obtained or does not maintain possession of such Collateral, and (c) as provided
in the Intercreditor Agreement (to the extent applicable).

SECTION 3.17 Employment Matters. As of the Effective Date, there are no strikes,
lockouts or slowdowns against any Loan Party or any Restricted Subsidiary
pending or, to the knowledge of the Borrowers, threatened. The hours worked by
and payments made to employees of the Loan Parties and the Restricted
Subsidiaries have not been in violation of the Fair Labor Standards Act or any
other applicable Federal, state, local or foreign law dealing with such matters
to the extent such violation could

 

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reasonably be expected to result in a Material Adverse Effect. All payments due
from any Loan Party or any Restricted Subsidiary, or for which any claim may be
made against any Loan Party or any Restricted Subsidiary, on account of wages
and employee health and welfare insurance and other benefits, have been paid or
accrued as a liability on the books of the Loan Party or such Restricted
Subsidiary other than payments the failure of which to make could not reasonably
be expected to result in a Material Adverse Effect.

SECTION 3.18 Common Enterprise. The successful operation and condition of each
of the Loan Parties is dependent on the continued successful performance of the
functions of the group of the Loan Parties as a whole and the successful
operation of each of the Loan Parties is dependent on the successful performance
and operation of each other Loan Party. Each Loan Party expects to derive
benefit (and its board of directors or other governing body has determined that
it may reasonably be expected to derive benefit), directly and indirectly, from
(i) successful operations of each of the other Loan Parties and (ii) the credit
extended by the Lenders to the Borrowers hereunder, both in their separate
capacities and as members of the group of companies. Each Loan Party has
determined that execution, delivery, and performance of this Agreement and any
other Loan Documents to be executed by such Loan Party is within its purpose,
will be of direct and indirect benefit to such Loan Party, and is in its best
interest.

SECTION 3.19 Permitted Indebtedness. The execution, delivery and performance of
the Loan Documents and the incurrence of the Obligations do not conflict with or
violate the Term Loan Agreement or the Holdings Notes Indenture. This Agreement
and the Obligations constitute a “Credit Facility” permitted under and as
defined in the Holdings Notes Indenture. This Agreement and the Obligations
constitute a “Revolving Facility” permitted under and as defined in the Term
Loan Agreement.

SECTION 3.20 OFAC. No Loan Party (i) is a person whose property or interest in
property is blocked or subject to blocking pursuant to Section 1 of Executive
Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions
With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg.
49079 (2001)), (ii) to the best of its knowledge, engages in any dealings or
transactions prohibited by Section 2 of such executive order, or is otherwise
associated with any such person in any manner violative of Section 2, or
(iii) is a person on the list of Specially Designated Nationals and Blocked
Persons or subject to the limitations or prohibitions under any other U.S.
Department of Treasury’s Office of Foreign Assets Control regulation or
executive order.

SECTION 3.21 Patriot Act, Etc. Each Loan Party is in compliance, in all material
respects, with (i) the Trading with the Enemy Act, as amended, and each of the
foreign assets control regulations of the United States Treasury Department (31
CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or
executive order relating thereto, and (ii) the Patriot Act. No part of the
proceeds of the Loans will be used, 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.

SECTION 3.22 Margin Regulations. No Loan Party is engaged principally, as one or
more of its important activities, in the business of extending credit for the
purpose of purchasing any “margin stock” as defined in Regulation U. Neither the
making of any Loan hereunder nor the use of the proceeds thereof will violate
the provisions of Regulation T, U or X of the Board.

 

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ARTICLE IV

CONDITIONS

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

(a) Credit Agreement and Loan Documents. The Administrative Agent (or its
counsel) shall have received (i) from each party hereto either (A) a counterpart
of this Agreement signed on behalf of such party or (B) written evidence
satisfactory to the Administrative Agent (which may include facsimile or other
electronic transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement and (ii) duly executed copies
of the Loan Documents and such other certificates, documents, instruments and
agreements as the Administrative Agent shall reasonably request in connection
with the transactions contemplated by this Agreement and the other Loan
Documents, including any promissory notes requested by a Lender pursuant to
Section 2.10 payable to each such requesting Lender and a written opinion of the
Loan Parties’ counsel, addressed to the Administrative Agent, each Issuing Bank
and the Lenders in form and substance reasonably acceptable to the
Administrative Agent and the Lead Arrangers.

(b) Officer’s Certificates; Certified Certificate of Organization; Good Standing
Certificates. The Administrative Agent shall have received (i) a certificate of
each Loan Party, dated the Effective Date and executed by its secretary or
assistant secretary, which shall (A) certify the resolutions of its board of
directors, members or other body authorizing the execution, delivery and
performance of the Loan Documents to which it is a party, (B) identify by name
and title and bear the signatures of the Financial Officers and any other
officers of such Loan Party authorized to sign the Loan Documents to which it is
a party, (C) contain appropriate attachments, including the certificate or
articles of incorporation or organization of each Loan Party certified by the
relevant authority of the jurisdiction of organization of such Loan Party as of
a recent date and a true and correct copy of its by-laws or operating,
management or partnership agreement and (D) in the case of the Borrower
Representative, certify as to the condition precedent set forth in
clause (h) below, and (ii) a good standing certificate for each Loan Party from
its jurisdiction of organization.

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

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

(e) Pay-Off Letter. The Administrative Agent shall have received a satisfactory
pay-off letter for the Existing Credit Agreement to be repaid from the proceeds
of the Revolving Loans advanced on the Effective Date, confirming that the
Existing Credit Agreement, all commitments thereunder and all Liens upon any of
the property of the Loan Parties constituting Collateral will be terminated
concurrently with such payment.

 

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(f) Solvency. The Administrative Agent shall have received the Solvency
Certificate set forth as Exhibit H hereto (the “Solvency Certificate”) from a
Financial Officer.

(g) Borrowing Base Certificate. The Administrative Agent shall have received a
Borrowing Base Certificate which calculates the Borrowing Base as of the end of
the most recent calendar month ended at least 15 days prior to the Effective
Date.

(h) Closing Availability. After giving effect to all Borrowings to be made on
the Effective Date and the issuance (or deemed issuance) of any Letters of
Credit on the Effective Date and payment of all fees and expenses due hereunder,
and with all of the Loan Parties’ indebtedness, liabilities, and obligations
current, the Availability shall not be less than $50,000,000.

(i) Pledged Stock; Stock Powers. The Administrative Agent shall have received
all certificates representing the Equity Interests pledged pursuant to the
Security Agreement, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the pledgor
thereof.

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

(k) Insurance. The Administrative Agent shall have received evidence of
insurance coverage in form, scope, and substance reasonably satisfactory to the
Administrative Agent and otherwise in compliance with the terms of Section 5.09
and Section 4.11 of the Security Agreement.

(l) Appraisals. The Lead Arrangers shall have received the Inventory Appraisal
in form and scope consistent with the appraisal conducted by HILCO Appraisal
Services, LLC dated October 19, 2011 (it being acknowledged that this condition
has been satisfied as of the Effective Date by the delivery of the Inventory
Appraisal dated June 27, 2012).

(m) Field Examinations. The Lead Arrangers shall have received a satisfactory
field examination of the Borrowers’ and the other Loan Guarantors’ books,
records and Collateral conducted in a customary manner as conducted by the
Administrative Agent in connection with similar asset based lending facilities
(it being acknowledged that this condition has been satisfied as of the
Effective Date).

(n) No Company Material Adverse Effect. (i) From December 31, 2011 through the
date of the Commitment Letter, except as set forth in (A) the Company SEC
Documents (excluding, in each case, any disclosures contained or referenced
therein under the captions “Risk Factors” or “Forward Looking Statements” and
any other disclosures contained or referenced therein relating to information,
factors or risks that are predictive, cautionary or forward looking in nature)
filed with the SEC after December 31, 2011 and prior to the date of the Merger
Agreement (and then (1) only to the extent that the relevance of any disclosed
event, item or occurrence in such Company SEC Documents to a matter covered by
this condition is reasonably apparent as to matters and items which are subject
of such representation or warranty, (2) other than any matters required to be
disclosed for purposes of Sections 3.1, 3.2, 3.3, 3.6 and 3.7 of the Merger
Agreement, which matters shall only be disclosed by specific disclosure in the
respective corresponding section of the Company Disclosure Letter), and
(3) without giving effect to any amendment to any such documents filed on or
after the date of the Commitment Letter) or (B) the corresponding sections or
subsections of the Company Disclosure Letter (it being acknowledged and

 

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agreed that disclosure of any item in any section or subsection of the Company
Disclosure Letter shall be deemed disclosure with respect to any other section
or subsection only to the extent that the relevance of such disclosure to such
other section or subsection is reasonably apparent on the face of such
disclosure) and (ii) since the date of the Commitment Letter, there has not been
any event, occurrence, development or state of circumstances or facts that has
had or would reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect.

(o) Merger Consummation. The Merger shall have been consummated, or
substantially simultaneously with the initial Borrowings hereunder, shall be
consummated, in all material respects in accordance with the terms of the Merger
Agreement, without giving effect to any modifications, amendments, consents or
waivers thereto or thereunder, in each case that are materially adverse to the
Lenders or the Lead Arrangers as reasonably determined by the Lead Arrangers (it
being understood that any modification, amendment, consent or waiver (i) to the
definition of “Company Material Adverse Effect”, (ii) to the condition that the
representations regarding the accuracy of Section 3.10 of the Merger Agreement
be true and correct in all respects when made and as of the date of the
consummation of the Merger as of the time when made, and (iii) to Section 3.10
of the Merger Agreement or Section 3.10 of the Company Disclosure Letter shall
be deemed to be material and adverse to the interests of the Lenders and the
Lead Arrangers), without the prior consent of the Lead Arrangers.

(p) Equity Contribution. The Equity Contribution shall have been made.

(q) Second Supplemental Indenture. The Second Supplemental Indenture shall be
effective.

(r) Historical Financials. The Lead Arrangers shall have received (i) audited
consolidated balance sheets of Holdings and related statements of income,
changes in equity and cash flows of Holdings as of and for the fiscal years
ended December 25, 2009, December 31, 2010 and December 30, 2011, and
(ii) unaudited consolidated balance sheets and related statements of income,
changes in equity and cash flows of Holdings for the fiscal quarters ended
March 30, 2012, June 29, 2012 and, if such date precedes the Effective Date by
at least 45 days, September 28, 2012.

(s) Representations and Warranties. Each of (i) the Specified Merger Agreement
Representations and (ii) the representations and warranties in Sections 3.01,
3.02, 3.03(b)(i) and (c), 3.08, 3.13, 3.16, 3.19, 3.20, 3.21 and 3.22 shall be
true and correct in all material respects on and as of the Effective Date;
provided, that any such representation and warranty that is qualified as to
“materiality” shall be true and correct in all respects.

(t) Patriot Act, Etc. The Administrative Agent and the Lead Arrangers shall have
received, at least three days prior to the Effective Date, all customary
documentation and other information about Holdings, the Company and the other
Loan Guarantors as has been reasonably requested in writing at least five days
prior to the Effective Date by the Administrative Agents or the Joint
Bookrunners that they reasonably determine is required under applicable “know
your customer” and anti-money laundering rules and regulations, including
without limitation the Patriot Act.

(u) Closing Certificate. The Administrative Agent shall have received a
certificate, signed by an authorized officer of the Borrower Representative, on
the Effective Date certifying that the conditions set forth in clauses (n), (o),
(p), (q) and (s) of this Section 4.01 have been satisfied and attaching thereto
true and complete copies of (A) the fully-executed Merger Agreement and the
other material documents evidencing the closing of the transactions contemplated
by the Merger Agreement and (B) the fully-executed Second Supplemental
Indenture.

 

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(v) Pro Forma Financial Statements. The Lead Arrangers shall have received a pro
forma consolidated balance sheet and related pro forma consolidated statement of
income of Holdings as of and for the twelve-month period ending on the last day
of the most recently completed four-fiscal quarter period ended at least 45 days
prior to the Effective Date, prepared after giving effect to the Transactions as
if the Transactions had occurred as of such date (in the case of such balance
sheet) or at the beginning of such period (in the case of such other financial
statements), which shall be prepared in compliance with Regulation S-X of the
Securities Act of 1933, as amended (subject to exceptions customary for
offerings conducted under Rule 144A or otherwise mutually agreed), including
preliminary adjustments for purchase accounting (including adjustments of the
type contemplated by Financial Accounting Standards Board Accounting Standards
Codification 805, Business Combinations (formerly SFAS 141R)).

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

The Administrative Agent shall notify the Borrowers and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans and of the Issuing
Banks to issue Letters of Credit hereunder shall not become effective unless
each of the foregoing conditions is satisfied (or waived with the consent of all
Lenders) at or prior to 11:59 p.m., New York City time, on November 29, 2012
(and, in the event such conditions are not so satisfied or waived, the
Commitments shall terminate at such time). The acceptance by the Borrowers of
the initial Borrowings and the issuance (or deemed issuance) of the initial
Letters of Credit hereunder shall constitute a representation and warranty that
all of the representations and warranties of the Borrowers set forth in this
Agreement are true and correct.

SECTION 4.02 Each Credit Event. Other than the initial Borrowings and Letters of
Credit issued (or deemed issued) on the Effective Date, the obligation of each
Lender to make a Loan on the occasion of any Borrowing, and of the Issuing Banks
to issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:

(a) The representations and warranties of the Borrowers set forth in this
Agreement shall be true and correct in all material respects on and as of the
date of such Borrowing or the date of issuance, amendment, renewal or extension
of such Letter of Credit, as applicable; provided, that any such representations
and warranties that are qualified as to “materiality” or “Material Adverse
Effect” shall be true and correct in all respects (it being understood that such
representations and warranties that relate solely to an earlier date or period
shall be true and correct in all material respects as of such earlier date or
for the respective period, as the case may be).

(b) At the time of and immediately after giving effect to such Borrowing or the
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no Default shall have occurred and be continuing.

(c) Availability is not less than the amount of the proposed Borrowing or
Letters of Credit.

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

 

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ARTICLE V

AFFIRMATIVE COVENANTS

Until the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees payable hereunder shall have been paid in
full and all Letters of Credit shall have expired, been cash collateralized,
backstopped or terminated and all LC Disbursements shall have been reimbursed
(in each case other than contingent indemnification obligations for which no
claim has been identified), each Loan Party executing this Agreement covenants
and agrees, jointly and severally with all of the Loan Parties, with the Lenders
that:

SECTION 5.01 Financial Statements; Borrowing Base and Other Information. The
Borrowers will furnish to the Administrative Agent:

(a) within 90 days after the end of each fiscal year of Holdings, its audited
consolidated balance sheet and related statements of operations, stockholders’
equity and cash flows as of the end of and for such year, setting forth in each
case in comparative form the figures for the previous fiscal year, all reported
on by Deloitte & Touche LLP or another independent public accountants of
recognized national standing (without a “going concern” or like qualification or
exception (other than with respect to the current maturity of the Obligations in
the case of the audit for the fiscal year ending December 31, 2016 in the event
such maturity is not extended) and without any qualification or exception as to
the scope of such audit) to the effect that such consolidated financial
statements present fairly in all material respects the financial condition and
results of operations of Holdings and its consolidated Restricted Subsidiaries
on a consolidated basis in accordance with GAAP consistently applied;

(b) within 45 days after the end of each of the first three fiscal quarters of
Holdings, its consolidated balance sheet and related statements of operations,
stockholders’ equity and cash flows as of the end of and for such fiscal quarter
and the then elapsed portion of the fiscal year, setting forth in each case in
comparative form the figures for the corresponding period or periods of (or, in
the case of the balance sheet, as of the end of) the previous fiscal year, all
certified by a Financial Officer of Holdings as presenting fairly in all
material respects the financial condition and results of operations of Holdings
and its consolidated Restricted Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes;

(c) concurrently with any delivery of financial statements under clause (a) or
(b) above, a certificate of a Financial Officer of Holdings in substantially the
form of Exhibit C (a “Compliance Certificate”) (i) certifying, in the case of
the financial statements delivered under clause (b), as presenting fairly in all
material respects the financial condition and results of operations of Holdings
and its consolidated Restricted Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes, (ii) certifying as to whether a
Default has occurred and, if a Default has occurred, specifying the details
thereof and any action taken or proposed to be taken with respect thereto,
(iii) setting forth a reasonably detailed calculation of the Fixed Charge
Coverage Ratio for the most recently ended four fiscal quarters (whether or not
during a Covenant Trigger Period) and, if applicable, demonstrating compliance
with Section 6.12, (iv) the amount of any Pro Forma Adjustment not previously
set forth in a Pro Forma Adjustment Certificate or any change in the amount of a
Pro Forma Adjustment set forth in any Pro Forma Adjustment Certificate
previously provided and, in either case, in reasonable detail, the calculations
and basis therefor and (v) stating whether any change in GAAP or in the
application thereof has occurred since the date of the audited financial
statements referred to in Section 3.04 and, if any such change has occurred,
specifying the effect of such change on the financial statements accompanying
such certificate;

 

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(d) as soon as available, but in any event not more than 90 days after the end
of each fiscal year of Holdings, a copy of the plan and forecast (including a
projected consolidated balance sheet, income statement and cash flow statement)
of Holdings for each month of the upcoming fiscal year (the “Projections”) in
form consistent with the projections delivered to and approved by the board of
directors of Holdings;

(e) as soon as available but in any event within 15 Business Days of the end of
each calendar month end (or within 3 Business Days after the last Business Day
of each week during any Covenant Trigger Period), as of the period then ended, a
Borrowing Base Certificate and supporting information in connection therewith;
provided, that the Borrowers may deliver updates to the Borrowing Base (i) in
connection with any Permitted Acquisition, at least three Business Days prior to
the consummation of such Permitted Acquisition, in which case, the Borrowing
Base may include, as provided in clause (j) of the definition of “Permitted
Acquisition”, the Eligible Accounts and Eligible Inventory acquired or to be
acquired in connection with such Permitted Acquisition, and (ii) at such other
times as the Administrative Agent may agree in its discretion;

(f) as soon as available but in any event within 15 Business Days of the end of
each calendar month end (and within 3 Business Days after the last Business Day
of each week during any Covenant Trigger Period), as of the period then ended,
all of the collateral monitoring reporting requirements listed on Exhibit E;

(g) as soon as reasonably practicable following the Administrative Agent’s
request (to the extent available):

(i) copies of invoices in connection with the invoices issued by the Borrowers
in connection with any Accounts, credit memos, shipping and delivery documents,
and other information related thereto;

(ii) copies of purchase orders and invoices in connection with any Inventory or
Equipment purchased by any Loan Party;

(iii) a schedule of account balances of all intercompany accounts of the Loan
Parties; and

(iv) as of the period then ended, the Borrowers’ sales journal and cash receipts
journal (identifying trade and non-trade cash receipts);

(h) as soon as reasonably practicable after the Administrative Agent’s request,
but (so long as no Default is continuing) no more frequently than annually, an
updated customer list for the Borrowers and their Restricted Subsidiaries, which
list shall state the customer’s name, mailing address and phone number and shall
be certified by a Financial Officer of the Borrower Representative as true and
correct in all material respects to the best of the Financial Officer’s
knowledge;

(i) as soon as reasonably practicable after the same become publicly available,
copies of all periodic and other reports, proxy statements and other materials
filed by Holdings, any Borrower or any Restricted Subsidiary with the SEC, or
any Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, or distributed by Holdings
to its shareholders generally, as the case may be;

(j) not later than any date on which financial statements are delivered with
respect to the most recently ended four fiscal quarters in which a Pro Forma
Adjustment is made as a result of the consummation of the acquisition of any
Acquired Entity or Business by any Borrower or any Restricted Subsidiary for
which there shall be a Pro Forma Adjustment, a Pro Forma Adjustment Certificate;
and

 

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(k) as soon as reasonably practicable following any request therefor, such other
information regarding the operations, business affairs and financial condition
of Holdings or any Restricted Subsidiary, or compliance with the terms of this
Agreement, as the Administrative Agent or any Lender (through the Administrative
Agent) may reasonably request.

To the extent that any of the documents required to be delivered pursuant to
Sections 5.01(a), (b) or (i) are also filed with the SEC, the Borrowers may
fulfill such delivery requirements by providing the Administrative Agent, in
writing, an internet link to a corresponding SEC filing that conforms with the
requirements of such Sections. The Administrative Agent will promptly forward
all deliveries and notices received by it from by the Loan Parties under this
Section 5.01 to each of the Lenders (other than clauses (f) through (h), which
will be made available to each Lender at such Lender’s request), which
communication may be made by delivery of hard copies, email or posting the
information to an intranet or internet site or other electronic communication
methods adopted by the Administrative Agent, and will provide notice to each
such Lender of the posting of any such intranet, internet or other electronic
communication.

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

(a) the occurrence of any Default;

(b) (i) any governmental investigation or any litigation or proceeding commenced
or threatened against any Loan Party that (A) seeks damages in excess of
$25,000,000, (B) seeks material injunctive relief, or (C) alleges criminal
misconduct by any Loan Party, or (ii) receipt of any notice of any governmental
investigation or any litigation or proceeding commenced or threatened by a
Governmental Authority against any Loan Party that alleges any tax, fee,
assessment, or other governmental charge in excess of $25,000,000;

(c) any Lien (other than Permitted Encumbrances and Liens permitted under
Section 6.02(l) and (k)) or claim made or asserted against any Inventory or
Accounts of any Loan Party;

(d) any loss, damage, or destruction to Inventory in the amount of $20,000,000
or more (or other Collateral in an amount of $40,000,000 or more), whether or
not covered by insurance;

(e) any and all default notices received under or with respect to any leased
location or public warehouse where Inventory with a fair market value exceeding
$10,000,000 is located alleging non-payment of rent or other amounts due in
excess of three months’ rent to the relevant landlord or warehouseman or any
other material default;

(f) the entry by any Loan Party into a Swap Agreement, agreement to provide
Banking Services or amendment thereto with a Lender or Lead Arranger or an
Affiliate of a Lender or Lead Arranger that is intended to be secured by the
Collateral, together with copies of all agreements evidencing such Swap
Agreement, agreement to provide Banking Services or amendment thereto (which
shall be delivered within ten (10) Business Days of entry into such Swap
Agreement, agreement to provide Banking Services or amendment thereto);

(g) the occurrence of any ERISA Event that, alone or together with any other
ERISA Events that have occurred, could reasonably be expected to result in a
Material Adverse Effect; and

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

 

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Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower Representative
setting forth the details of the event or development requiring such notice and
any action taken or proposed to be taken with respect thereto. The
Administrative Agent will promptly forward all notices received by it from the
Loan Parties under this Section 5.02 to each of the Lenders, which communication
may be made by delivery of hard copies, email or posting the information to an
intranet or internet site or other electronic communication methods adopted by
the Administrative Agent, and will provide notice to each such Lender of the
posting of any such intranet, internet or other electronic communication.

SECTION 5.03 Existence; Conduct of Business. Each Loan Party will, and will
cause each Restricted Subsidiary to, do or cause to be done all things necessary
to preserve, renew and keep in full force and effect its legal existence and,
except where the failure to so preserve, renew or keep in full force and effect
any of the following could not reasonably be expected to result in a Material
Adverse Effect, the rights, qualifications, licenses, permits, franchises,
governmental authorizations, intellectual property rights, licenses and permits
for the conduct of its business, and maintain all requisite authority to conduct
its business in each jurisdiction in which its business is conducted; provided
that the foregoing shall not prohibit any merger, consolidation, liquidation or
dissolution permitted under Section 6.03.

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

SECTION 5.05 Maintenance of Properties. Each Loan Party will, and will cause
each Restricted Subsidiary to, keep and maintain all property material to the
conduct of its business in good working order and condition, ordinary wear and
tear excepted, except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.

SECTION 5.06 Books and Records; Inspection Rights. Each Loan Party will, and
will cause each Restricted Subsidiary to, (i) keep proper books of record and
account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities and (ii) permit any
representatives designated by the Administrative Agent (including employees of
the Administrative Agent or any consultants, accountants, lawyers and appraisers
retained by the Administrative Agent), upon reasonable prior notice, to visit
and inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers
and independent accountants, all at such reasonable times and as often as
reasonably requested. The Borrowers shall reimburse the Administrative Agent
and/or its representatives for all reasonable charges, costs and expenses
related thereto with respect to no more than one such inspection during each
calendar year; provided, however, that if Availability is less than the greater
of (a) $43,750,000 or (b) 17.5% of the Commitments at any time, the Borrowers
shall reimburse the Administrative Agent and/or its representatives for all
reasonable charges, costs and expenses related to a second such inspection
during such calendar year; and provided, further, that there shall be no
limitation on the number or frequency of inspections that shall be at the sole
expense of the Borrowers if any Event of Default shall have occurred and be
continuing. The limits set forth in the foregoing sentence on the number of
inspections required to be reimbursed by the Borrowers shall not apply to, or
include, any inspections conducted pursuant to

 

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clause (j) of the definition of “Permitted Acquisition”. The Loan Parties
acknowledge that the Administrative Agent, after exercising its rights of
inspection, may prepare and distribute to the Lenders certain Reports pertaining
to the Loan Parties’ assets for internal use by the Administrative Agent and the
Lenders.

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

SECTION 5.08 Use of Proceeds. The proceeds of the Loans will be used (a) on the
Effective Date (i) to refinance the Existing Credit Agreement, including the
cash collateralization or back-to-back credit support of the outstanding letters
of credit thereunder that are not Existing Letters of Credit and (ii) to make
the Specified Distribution; provided that (1) the aggregate amount funded
hereunder does not exceed $110,000,000 and (2) Availability is greater than 20%
of the Commitments before and after giving effect thereto, and (b) following the
Effective Date (i) to issue Letters of Credit and (ii) for the working capital
needs and general corporate purposes of the Borrowers and the Restricted
Subsidiaries, including to fund distributions permitted under Section 6.08. No
part of the proceeds of any Loan and no Letter of Credit will be used, whether
directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations T, U and X.

SECTION 5.09 Insurance. Each Loan Party will, and will cause each Restricted
Subsidiary to, maintain with financially sound and reputable carriers having a
financial strength rating of at least A- by A.M. Best Company (a) insurance in
such amounts (with no greater risk retention) and against such risks (including
loss or damage by fire, business interruption and general liability) and such
other hazards, as is reasonably available and is customarily maintained by
companies of established repute engaged in the same or similar businesses
operating in the same or similar locations with asset-based loan facilities and
(b) all insurance required pursuant to the Collateral Documents. The Borrowers
will furnish to the Lenders, upon request of the Administrative Agent,
information in reasonable detail as to the insurance so maintained.

SECTION 5.10 Appraisals. Subject to the reimbursement limitations contained in
the next sentence, at any time that the Administrative Agent requests the
Borrowers and the Restricted Subsidiaries will provide the Administrative Agent
with appraisals or updates thereof of their Inventory from an appraiser selected
and engaged by the Administrative Agent, and prepared on a basis reasonably
satisfactory to the Administrative Agent, such appraisals and updates to
include, without limitation, information required by applicable law and
regulations. The Borrowers shall reimburse the Administrative Agent for all
reasonable charges, costs and expenses related thereto with respect to no more
than one such appraisal during each calendar year; provided, however, that if
Availability is less than the greater of (a) $43,750,000 or (b) 17.5% of the
Commitments at any time, the Borrowers shall reimburse the Administrative Agent
for all reasonable charges, costs and expenses related to a second such
appraisal during such calendar year; and provided further, that there shall be
no limitation on the number or frequency of appraisals and updates that shall be
at the sole expense of the Borrowers if any Event of Default shall have occurred
and be continuing. The limits set forth in the foregoing sentence on the number
of appraisals required to be reimbursed by the Borrowers shall not apply to, or
include, any appraisals obtained pursuant to clause (j) of the definition of
“Permitted Acquisition”.

SECTION 5.11 Field Examinations. Subject to the reimbursement limitations
contained in the next sentence, at any time that the Administrative Agent
requests the Borrowers and the Restricted Subsidiaries will allow the
Administrative Agent (or its designee) to conduct field examinations or updates
thereof to ensure the adequacy of Collateral included in any Borrowing Base and
related

 

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reporting and control systems, and prepared on a basis reasonably satisfactory
to the Administrative Agent, such field examinations and updates to include,
without limitation, information required by applicable law and regulations. The
Borrowers shall reimburse the Administrative Agent for all reasonable charges,
costs and expenses related thereto with respect to no more than one such field
examination during each calendar year; provided, however, that if Availability
is less than the greater of (a) $43,750,000 or (b) 17.5% of the Commitments at
any time, the Borrowers shall reimburse the Administrative Agent for all
reasonable charges, costs and expenses related to a second such field
examination during such calendar year; and provided, further, that there shall
be no limitation on the number or frequency of field examinations that shall be
at the sole expense of the Borrowers if any Event of Default shall have occurred
and be continuing. The limits set forth in the foregoing sentence on the number
of field examinations required to be reimbursed by the Borrowers shall not apply
to, or include, any field examinations conducted pursuant to clause (j) of the
definition of “Permitted Acquisition”.

SECTION 5.12 Depository Banks. Each Loan Party will maintain the Administrative
Agent or another Lender as its principal depository bank, including for the
maintenance of operating, administrative, cash management, and other deposit
accounts for the conduct of its business, provided, that, subject to
Section 5.14, the Loan Parties shall maintain their collection accounts with
BofA (or another financial institution selected by such Person and acceptable to
the Administrative Agent), which collection accounts shall be subject to deposit
account control agreements meeting the requirements of the Security Agreement.

SECTION 5.13 Additional Collateral; Further Assurances. (a) Subject to
applicable law, each Borrower and each Restricted Subsidiary that is a Loan
Party shall cause each of its Domestic Subsidiaries (other than an Excluded
Subsidiary) formed or acquired after the date of this Agreement in accordance
with the terms of this Agreement to become a Loan Party (either as a Borrower or
a Loan Guarantor) by executing the Joinder Agreement set forth as Exhibit D
hereto (the “Joinder Agreement”). Upon execution and delivery thereof, each such
Person (i) shall automatically become a Borrower or Loan Guarantor hereunder as
specified in such Joinder Agreement, and thereupon shall have all of the rights,
benefits, duties, and obligations in such capacity under the Loan Documents and
(ii) will grant Liens to the Administrative Agent, for the benefit of the
Administrative Agent and the Secured Parties, in any property of such Loan Party
which constitutes Collateral of the types contemplated by the Collateral
Documents.

(b) Each Loan Party will cause 100% of the issued and outstanding Equity
Interests of each of its Domestic Subsidiaries (other than (i) Excluded
Subsidiaries described in clauses (c) or (f) of the definition therefor and
(ii) Excluded Subsidiaries described in clause (a) thereof to the extent that
the constituent documents of such Excluded Subsidiaries prohibit the granting of
Liens thereon) owned by it to be subject at all times to a first priority,
perfected Lien in favor of the Administrative Agent pursuant to the terms and
conditions of the Loan Documents or other security documents as the
Administrative Agent shall reasonably request.

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

 

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(d) If any material assets (other than assets not required to be Collateral
under the terms of the Collateral Documents) are acquired by any Loan Party
after the Effective Date (other than assets constituting Collateral under the
Security Agreement that become subject to the Lien in favor of the Security
Agreement upon acquisition thereof), the Borrower Representative will notify the
Administrative Agent and the Lenders thereof, and, if requested by the
Administrative Agent or the Required Lenders, the Loan Parties will cause such
assets to be subjected to a Lien securing the Secured Obligations and will take
such actions as shall be necessary or reasonably requested by the Administrative
Agent to grant and perfect such Liens, including actions described in paragraph
(c) of this Section, all at the expense of the Loan Parties.

(e) If any Loan Party grants Liens on any real property or any interest therein
pursuant to, and in compliance with the requirements of Section 6.02(l), the
Borrower Representative will notify the Administrative Agent thereof, and, the
Loan Parties will cause such real property (or interest therein) to be subjected
to a Lien securing the Secured Obligations, subject to the Intercreditor
Agreement, and will take such actions as shall be necessary or reasonably
requested by the Administrative Agent to grant and perfect such Liens, including
actions described in paragraph (c) of this Section, all at the expense of the
Loan Parties.

(f) Notwithstanding anything to the contrary in this Section 5.13 or any other
provision of this Agreement or any Collateral Document, Holdings shall not be
required to grant or take any other action with respect to a security interest
in any assets of Holdings (including the Equity Interests of the Company held by
it); provided that, if at any time after the Term Loan Closing Date, (i) the
Holdings Notes or any Holdings Refinancing Indebtedness are repaid, repurchased,
redeeemed, defeased or otherwise acquired or retired, (ii) Holdings grants a
security interest in any of its assets as security for any obligations under the
Term Loan Documents or (iii) the Term Loans are no longer secured (the first to
occur of an event under the foregoing clauses, a “Holdings Security Event”),
Holdings shall, within 90 days of the Holdings Security Event, execute and
deliver a Joinder Agreement in respect of the Security Agreement to the
Administrative Agent pursuant to which it shall grant Liens to the
Administrative Agent, for the benefit of the Administrative Agent and the
Secured Parties, in any property of Holdings which constitutes Collateral of the
types contemplated by the Collateral Documents in effect at such time and
Holdings shall execute and deliver to the Administrative Agent such additional
documents, agreements and instruments, and will take or cause to be taken such
further actions (including the filing and recording of financing statements,
fixture filings and other documents and such other actions or deliveries of the
type required by Section 4.01, as applicable), which may be required by law or
which the Administrative Agent may, from time to time, reasonably request to
carry out the terms and conditions of the Credit Agreement and the other Loan
Documents with respect to security and to ensure perfection and priority of the
Liens created or intended to be created by the Collateral Documents, all at the
expense of the Loan Parties.

SECTION 5.14 Post-Closing Actions. Each Loan Party agrees that it will, or will
cause its relevant Subsidiaries to, complete each of the actions described on
Schedule 5.14 as soon as commercially reasonable and by no later than the date
set forth in Schedule 5.14 with respect to such action or such later date as the
Administrative Agent may reasonably agree.

 

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ARTICLE VI

NEGATIVE COVENANTS

Until the Commitments have expired or terminated and the principal of and
interest on each Loan and all fees, expenses and other amounts payable under any
Loan Document have been paid in full and all Letters of Credit have expired,
been cash collateralized, backstopped or terminated and all LC Disbursements
shall have been reimbursed (in each case other than contingent indemnification
obligations for which no claim has been identified), the Loan Parties covenant
and agree, jointly and severally, with the Lenders that:

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

(a) the Secured Obligations;

(b) the First Lien Obligations of Holdings, the Company or any Restricted
Subsidiary in an aggregate principal amount that does not exceed the First Lien
Debt Cap; provided, that (i) such Indebtedness is comprised of term loans or
notes and has a final maturity date no earlier than the date that is 91 days
following the Maturity Date and (ii) in the case of secured Indebtedness, the
Liens securing such Indebtedness are subject to the Intercreditor Agreement.

(c) in the case of Holdings, the Holdings Notes in an aggregate principal amount
not to exceed (x) the aggregate principal amount of the Holdings Notes
outstanding immediately following the consummation of the Transactions less
(y) the aggregate principal amount of the Holdings Notes redeemed, repurchased
or retired (other than to the extent refinanced pursuant to Section 6.01(i));

(d) Indebtedness existing on the date hereof (other than the Term Loans and the
Holdings Notes) and set forth in Schedule 6.01 and extensions, renewals and
replacements of any such Indebtedness in accordance with clause (i) hereof;

(e) Indebtedness of any Borrower to any Restricted Subsidiary and of any
Restricted Subsidiary to any Borrower or any other Restricted Subsidiary,
provided that (i) Indebtedness of any Subsidiary that is not a Loan Party to any
Borrower or any Subsidiary that is a Loan Party shall be subject to Section 6.04
and (ii) Indebtedness of any Borrower to any Restricted Subsidiary that is not a
Loan Party and Indebtedness of any Restricted Subsidiary that is a Loan Party to
any Restricted Subsidiary that is not a Loan Party shall be subordinated to the
Secured Obligations and evidenced by a promissory note, in each case on terms
and conditions satisfactory to the Administrative Agent;

(f) Guarantees by (i) Holdings of Indebtedness described in clause (b) and
(ii) any Borrower of Indebtedness of any Restricted Subsidiary and by any
Restricted Subsidiary of Indebtedness of any Borrower or any other Restricted
Subsidiary, provided that in each case (1) the Indebtedness so Guaranteed is
permitted by this Section 6.01, (2) Guarantees by any Borrower or any Subsidiary
that is a Loan Party of Indebtedness of any Restricted Subsidiary that is not a
Loan Party shall be subject to Section 6.04 and (3) Guarantees permitted under
this clause (f) shall be subordinated to the Secured Obligations of the
applicable Restricted Subsidiary on the same terms as the Indebtedness so
Guaranteed is subordinated to the Secured Obligations;

(g) Indebtedness of any Loan Party or any Restricted Subsidiary incurred to
finance the acquisition, construction or improvement of any fixed or capital
assets (whether or not constituting

 

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purchase money Indebtedness), including Capital 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 in accordance
with clause (i) hereof; provided that (i) such Indebtedness is incurred prior to
or within 180 days after such acquisition or the completion of such construction
or improvement and (ii) the aggregate principal amount of Indebtedness permitted
by this clause (g) shall not exceed the greater of (A) $30,000,000 and (B) 3.0%
of Consolidated Total Assets;

(h) Guarantees of Indebtedness not to exceed $5,000,000 incurred on behalf of
one or more joint ventures in which any of the Loan Parties is an investor to
the extent permitted by Section 6.04;

(i) Indebtedness which represents an extension, refinancing, or renewal of any
of the Indebtedness described in clauses (c), (d), (g), (l), (m), (s) and
(t) hereof; provided that, (i) the principal amount of such Indebtedness is not
increased (other than increases in principal by an amount equal to any premiums,
fees or other costs of such refinancing), (ii) any Liens securing such
Indebtedness are not extended to any additional property of any Loan Party,
(iii) no Loan Party that is not originally obligated with respect to repayment
of such Indebtedness is required to become obligated with respect thereto,
(iv) such extension, refinancing or renewal does not result in a shortening of
the average weighted maturity of the Indebtedness so extended, refinanced or
renewed, (v) except in the case of Indebtedness extended, refinanced or renewed
at, or within twelve months prior to, maturity, the representations, covenants
and defaults applicable of any such extension, refinancing, or renewal, taken as
a whole, are not materially more burdensome to Borrowers than those applicable
to the Indebtedness being extended, refinanced or renewed, and (vi) if the
Indebtedness that is refinanced, renewed, or extended was subordinated in right
of payment to the Obligations or the Secured Obligations, then the terms and
conditions of the refinancing, renewal, or extension Indebtedness must include
subordination terms and conditions that are at least as favorable to the
Administrative Agent and the Lenders as those that were applicable to the
refinanced, renewed, or extended Indebtedness;

(j) Indebtedness owed to any person providing workers’ compensation, health,
disability or other employee benefits or property, casualty or liability
insurance, pursuant to reimbursement or indemnification obligations to such
person, in each case incurred in the ordinary course of business;

(k) Indebtedness of any Borrower or any Restricted Subsidiary in respect of
performance bonds, bid bonds, appeal bonds, surety bonds, performance and
completion guarantees and similar obligations not in connection with borrowed
money, in each case provided in the ordinary course of business;

(l) Indebtedness of any Person that becomes a Restricted Subsidiary (or is a
Restricted Subsidiary that survives a merger with such Person) or Indebtedness
relating to assets that are acquired by any Borrower or any Restricted
Subsidiary, in each case, after the Effective Date as the result of a Permitted
Acquisition; provided that (i) such Indebtedness existed at the time such Person
became a Restricted Subsidiary or at the time such assets were acquired and, in
each case, and was not created in anticipation thereof, (ii) such Indebtedness
is not guaranteed in any respect by any Borrower or any Restricted Subsidiary
(other than by any such Person that so becomes a Restricted Subsidiary or is the
survivor of a merger with such Person and any of its Subsidiaries), (iii) to the
extent required under Section 5.13, such Person executes a Joinder Agreement in
order to become a Loan Party, and (iv) the aggregate principal amount of
Indebtedness permitted by this clause (l) shall not exceed $30,000,000 at any
time outstanding;

 

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(m) Indebtedness of any Borrower or any Restricted Subsidiary consisting of
Capital Lease Obligations incurred in connection with the sale and leaseback
transactions relating to the Specified Properties permitted by Section 6.06(b);

(n) letters of credit, bank guarantees or bankers’ acceptances (other than
Letters of Credit issued pursuant to Section 2.06) having an aggregate face
amount not in excess of $15,000,000;

(o) unsecured Indebtedness owed to the Sponsors, certain Sponsor related parties
and/or other holders of the Equity Interests in Holdings and their respective
Affiliates; provided that such Indebtedness is Subordinated Indebtedness;

(p) Indebtedness of Holdings or any Restricted Subsidiary consisting of (i) the
financing of insurance premiums, (ii) take-or-pay obligations contained in
supply arrangements, in each case, incurred in the ordinary course of business
and not in connection with the borrowing of money, or (iii) Swap Obligations;

(q) cash management obligations and other Indebtedness of Foreign Subsidiaries
in respect of netting services, overdraft facilities, employee credit card
programs, Cash Pooling Arrangements or similar arrangements in connection with
cash management and deposit accounts; provided that with respect to any Cash
Pooling Arrangements, the total amount of all deposits subject to any such Cash
Pooling Arrangements shall at all times equal or exceed the total amount of
overdrafts that may be subject to such Cash Pooling Arrangements;

(r) Indebtedness arising from agreements of Holdings or any Restricted
Subsidiary providing for indemnification, adjustment of purchase price or
similar obligations, in each case, entered into in connection with Permitted
Acquisitions, other than Guarantees incurred by any Person acquiring all or any
portion of such business, assets or Equity Interests for the purpose of
financing any such Permitted Acquisition, or in connection with dispositions of
any business, assets or Equity Interests permitted hereunder; provided that
(i) such Indebtedness is not reflected on the balance sheet of Holdings or any
Restricted Subsidiary (it being understood that contingent obligations referred
to in a footnote to financial statements and not otherwise reflected on the
balance sheet will not be deemed to be reflected on such balance sheet for
purposes of this clause (r)) and (ii) the maximum assumable liability in respect
of all such Indebtedness shall at no time exceed the gross proceeds, including
non-cash proceeds (the fair market value of such non-cash proceeds being
measured at the time received and without giving effect to any subsequent
changes in value) actually received by the Borrowers and the Restricted
Subsidiaries in connection with any such disposition;

(s) Indebtedness of the Company and its Restricted Subsidiaries in an aggregate
amount not to exceed the greater of (A) $150,000,000 and (B) 15.0% of
Consolidated Total Assets;

(t) other Indebtedness of the Company and its Restricted Subsidiaries; provided,
that (i) (A) in the event that the proceeds of such Indebtedness are used to
repay, repurchase, redeem, defease or otherwise acquire or retire the Holdings
Notes or any Holdings Refinancing Indebtedness, in whole or in part, the
Interest Coverage Ratio would not be less than 2.00:1.00 calculated on a Pro
Forma Basis for the most recently ended Reference Period prior to the date of
the incurrence thereof or (B) in the event that the proceeds of such
Indebtedness are used for a purpose other than that described in the foregoing
clause (A), (1) if such Indebtedness is secured on a “first-lien” basis, the
First Lien Leverage Ratio would not exceed 3.75:1.00 calculated on a Pro Forma
Basis as of the last day of the most recently ended Reference Period prior to
the date of the applicable incurrence, and (2) if such Indebtedness is secured
on a “second-lien” or other junior lien basis or is unsecured, the Total
Leverage Ratio would not exceed 6.50:1.00 calculated on a Pro Forma Basis as of
the last day of the most recently ended Reference Period prior to

 

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the date of the incurrence thereof, (ii) in any case such Indebtedness is
comprised of term loans or notes and (except with respect to any Indebtedness
incurred to finance a Permitted Acquisition or other Investment permitted by
Section 6.04 and (A) owed to the seller of any property or assets acquired in
such Permitted Acquisition or other Investment in an aggregate principal amount
at any time outstanding for all such Indebtedness not to exceed $75,000,000 or
(B) in aggregate principal amount at any time outstanding for all other such
Indebtedness not to exceed $35,000,000) has a final maturity date no earlier
than the date that is 91 days following the Maturity Date, and (iii) in the case
of any secured Indebtedness, the Liens securing such additional Indebtedness
shall be subject to the Intercreditor Agreement;

(u) Indebtedness of Restricted Subsidiaries that are not Loan Parties; provided
that the aggregate principal amount at any time outstanding of such Indebtedness
shall not exceed the greater of (i) $30,000,000 and (ii) 3.0% of Consolidated
Total Assets; and

(v) with respect to Holdings, (i) Guarantees of Indebtedness described in clause
(t) above and (ii) Qualified Holdings Debt.

The accrual of interest, the accretion of accreted value, the accretion or
amortization of original issue discount and the payment of interest in the form
of additional Indebtedness (including any payment-in-kind interest) shall not be
deemed to be an incurrence of Indebtedness for purposes of this Section 6.01.

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

(a) Liens created pursuant to any Loan Document;

(b) Permitted Encumbrances;

(c) any Lien on any property or asset of any Borrower or any Restricted
Subsidiary existing on the date hereof and set forth in Schedule 6.02; provided
that (i) such Lien shall not apply to any other property or asset of such
Borrower or Restricted Subsidiary and (ii) such Lien shall secure only those
obligations which it secures on the date hereof and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof;

(d) Liens on fixed or capital assets acquired, constructed or improved by any
Loan Party or any Restricted Subsidiary; provided that (i) such Liens secure
Indebtedness permitted by Section 6.01(g), (ii) such Liens and the Indebtedness
secured thereby are incurred prior to or within 180 days after such acquisition
or the completion of such construction or improvement, (iii) the Indebtedness
secured thereby does not exceed 100% of the cost of acquiring, constructing or
improving such fixed or capital assets and (iv) such Liens shall not apply to
any other property or assets of such Loan Party, any other Loan Party or any
other Restricted Subsidiary;

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

 

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(f) Liens of a collecting bank arising in the ordinary course of business under
Section 4-210 of the Uniform Commercial Code in effect in the relevant
jurisdiction covering only the items being collected upon;

(g) Liens arising out of sale and leaseback transactions permitted by
Section 6.06;

(h) Liens granted by a Subsidiary that is not a Loan Party in favor of any
Borrower or another Loan Party in respect of Indebtedness owed by such
Subsidiary;

(i) Liens arising from precautionary UCC-1 financing statements;

(j) Liens that are (i) contractual rights of set-off relating to deposit
accounts in favor of banks and other depositary institutions in the ordinary
course of business or (ii) contractual rights of set-off or charge back in favor
of credit card processors arising in the ordinary course of business under
credit card processing agreements;

(k) Liens securing obligations in respect of trade-related letters of credit
permitted to be incurred under Section 6.01(n), which Liens shall cover only the
goods (or the documents of title in respect of such goods) financed by such
letters of credit and the proceeds and products thereof;

(l) Liens in respect of Indebtedness permitted to be incurred pursuant to
Sections 6.01(b), (t) and (v)(i); provided, that, in each case, such Liens are
subject to the Intercreditor Agreement or another intercreditor agreement
satisfactory to the Administrative Agent;

(m) Liens created in the ordinary course of business in favor of banks and other
financial institutions over credit balances of any bank accounts of any Foreign
Subsidiary held at such banks or financial institutions, as the case may be, to
facilitate the operation of Cash Pooling Arrangements and/or interest set-off
arrangements in respect of such bank accounts in the ordinary course of
business; and

(n) other Liens on assets not constituting Collateral securing Indebtedness or
other obligations in an aggregate principal amount at any time outstanding not
to exceed the greater of $50,000,000 and 5.0% of Consolidated Total Assets as of
the date of the applicable incurrence; provided that, upon the request of the
Administrative Agent, the applicable Loan Party shall use commercially
reasonable efforts to provide an access agreement, in form and substance
reasonably satisfactory to the Administrative Agent, with respect to any
Collateral located on or about any assets secured by Liens permitted pursuant to
this clause (n).

Notwithstanding the foregoing, none of the Liens permitted pursuant to this
Section 6.02 may at any time attach to any Loan Party’s (1) Accounts, other than
those permitted under clause (a) of the definition of Permitted Encumbrance and
clauses (a) and (l) above and (2) Inventory, other than those permitted under
clauses (a) and (b) of the definition of Permitted Encumbrance and clauses
(a) and (l) above.

SECTION 6.03 Fundamental Changes. (a) No Loan Party will, nor will it permit any
Restricted Subsidiary to, merge into or consolidate with any other Person, or
permit any other Person to merge into or consolidate with it, or liquidate or
dissolve, except that, if at the time thereof and immediately after giving
effect thereto no Event of Default shall have occurred and be continuing (i) any
Borrower may merge with and into another Borrower, (ii) any Subsidiary that is a
Loan Guarantor (other than a Borrower) may merge or liquidate into any Borrower
or any other Subsidiary that is a Loan Guarantor, (iii)

 

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any Subsidiary that is not a Loan Party may merge or liquidate into any other
Subsidiary that is not a Loan Party or into a Loan Party; provided that any such
merger involving a Person that is not a wholly owned Subsidiary immediately
prior to such merger shall not be permitted unless also permitted by
Section 6.04, (iv) any Subsidiary that is not a Loan Party may liquidate or
dissolve if the Company determines in good faith that such liquidation or
dissolution is in the best interests of the Company and is not materially
disadvantageous to the Lenders and (v) any Subsidiary may merge with another
Person in any Acquisition permitted under Section 6.04 provided such other
Person is or becomes a Restricted Subsidiary upon the consummation of such
merger and assumes all of the obligations of merging Subsidiary (if any) under
all of the Loan Documents.

(b) No Loan Party will, nor will it permit any of its Restricted Subsidiaries
to, engage to any material extent in any business other than businesses of the
type conducted by the Borrowers and their Subsidiaries on the Effective Date and
any business activities that are similar, related, incidental, complementary or
corollary thereto or a reasonable extension thereof.

(c) Glenwood will not engage in any business or activity other than the
ownership of Equity Interests in Buyers Access and activities incidental
thereto. Glenwood will not own or acquire any assets (other than Equity
Interests in Buyers Access, cash and Permitted Investments) or incur any
liabilities (other than liabilities under the Loan Documents, liabilities in
respect of Guarantees permitted by Section 6.01, liabilities imposed by law,
including Tax liabilities, and other liabilities incidental to its existence and
permitted business and activities).

(d) Holdings will not engage in any business or activity, or own or acquire any
assets or incur any liabilities, other than in connection with (i) the ownership
of all the outstanding Equity Interests in the Company, (ii) the maintenance of
its corporate existence, (iii) the consummation of the Transactions (including
the payment of customary fees and expenses in connection therewith), (iv) the
performance of its obligations under and in connection with the Loan Documents,
the Term Loan Documents (or the documentation relating to any other Term Loans)
and the Holdings Notes Documents, and repaying or redeeming, or otherwise
terminating or retiring, the Indebtedness governed by such documentation
(including the Term Loans and the Holdings Notes) in accordance with the terms
thereof, (v) the consummation of any offering of its Equity Interests permitted
under the terms of this Agreement (including the payment of customary fees and
expenses in connection therewith), (vi) the issuance, whether or not
consummated, of Indebtedness, permitted under Section 6.01, (vii) the ordinary
course grant of common stock to employees and directors pursuant to the terms of
any employee benefit or stock option plan, and (viii) investments in its
subsidiaries as permitted by Sections 6.01 and 6.04.

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

(a) cash and Permitted Investments, provided that such Permitted Investments
owned by a Loan Party are subject to control agreements in favor of the
Administrative Agent for the benefit of the Secured Parties or otherwise subject
to a perfected security interest in favor of the Administrative Agent for the
benefit of the Secured Parties, in each case to the extent required in the
Security Agreement;

 

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(b) investments in existence on the date of this Agreement and described in
Schedule 6.04 including any amendments, modifications, restatements, renewals or
supplements thereof that do not involve the provision of any new consideration
by any Loan Party or any Restricted Subsidiary;

(c) investments by Holdings in the Borrowers and by the Borrowers and the
Restricted Subsidiaries in any Restricted Subsidiaries; provided that (i) the
aggregate amount of investments by Loan Parties in Restricted Subsidiaries that
are not Loan Parties (together with outstanding Guarantees permitted under the
proviso to Section 6.04(d)) shall not exceed $30,000,000 at any time outstanding
(in each case determined without regard to any write-downs or write-offs),
(ii) any such investments in the form of loans and advances made by (A) a Loan
Party to another Loan Party shall be evidenced by the Intercompany Note, (B) a
Restricted Subsidiary that is not a Loan Party to a Loan Party shall be
subordinated to the Secured Obligations on terms and conditions satisfactory to
the Administrative Agent, and (C) a Loan Party to a Restricted Subsidiary that
is not a Loan Party shall be evidenced by a promissory note pledged pursuant to
the Security Agreement and (iii) any such investments in the form of Equity
Interests (other than Equity Interests in Excluded Subsidiaries (A) described in
clause (c) of the definition thereof and (B) described in clause (a) of the
definition thereof to the extent that the constituent documents of such Excluded
Subsidiaries prohibit the granting of Liens thereon) shall be pledged pursuant
to the Security Agreement;

(d) Guarantees constituting Indebtedness permitted by Section 6.01; provided
that the aggregate principal amount of Indebtedness of Subsidiaries that are not
Loan Parties that is Guaranteed by any Loan Party shall (together with
outstanding investments permitted under clause (i) to the proviso to
Section 6.04(c)) shall not exceed the greater of $30,000,000 and 3.0% of
Consolidated Total Assets (in each case determined without regard to any
write-downs or write-offs);

(e) Guarantees by Holdings or any other Loan Party of the obligations of the
Company or any of its Restricted Subsidiaries under leases (other than Capital
Leases or sale leasebacks) or contracts and other obligations that, in each
case, do not constitute Indebtedness and are entered into in the ordinary course
of business;

(f) loans or advances made by a Loan Party to its officers, directors and
employees on an arms’-length basis (i) in the ordinary course of business
consistent with past practices for travel and entertainment expenses, relocation
costs and similar purposes and (ii) in connection with such Person’s purchase of
Equity Interests of Holdings or any Parent to the extent that the amount of such
loans or advances are contributed to Holdings in cash, the aggregate principal
amount of such loans and advances outstanding at any one time not to exceed
$10,000,000;

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

(h) (i) extensions of trade credit in the ordinary course of business,
(ii) investments in the ordinary course of business consisting of Article 3 or
Article 4 endorsements for collection or deposit, and (iii) advances of payroll
payments to employees in the ordinary course of business;

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

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

 

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

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

(m) any investment (including a Permitted Acquisition) to the extent that
payment for such investment is made solely with, or with the cash proceeds of
the issuance of, Equity Interests of Holdings (other than Disqualified Stock) or
with the cash proceeds of capital contributions to Holdings from the holders of
its Equity Interests, in each case which are designated as being for the purpose
of making such investment by written notice to the Administrative Agent;

(n) 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;

(o) investments made to repurchase or retire Equity Interests of Holdings owned
by directors, officers or employees or any employee stock ownership plan of the
Company (or any direct or indirect parent thereof) to the extent permitted by
Section 6.08; and

(p) Permitted Acquisitions and other investments (any such Permitted Acquisition
or other investment being made pursuant to this clause (p), a “Specified
Investment”); provided that on the date of such Specified Investment (i) no
Default or Event of Default then exists of would result therefrom and (ii) after
giving effect thereto on a pro forma basis either (A) both (1) Availability is
greater than the higher of 10% of the Commitments and $25,000,000 and (2) the
Fixed Charge Coverage Ratio for the period of four consecutive fiscal quarters
ending on the last day of the most recent fiscal quarter or fiscal year for
which financial statements have been delivered pursuant to Section 5.01(a) or
(b), as applicable, is greater than 1.0 to 1.0 or (B) Availability is greater
than the higher of 15% of the Commitments and $37,500,000; provided further that
if the test in clause (p)(ii) for Specified Investments is not satisfied, then
any Loan Party shall be permitted to make Specified Investments in an amount
which, when aggregated with all prior Specified Investments made under this
clause (p) that did not satisfy the test in clause (p)(ii), does not exceed
$25,000,000 so long as, after giving pro forma effect to the Specified
Investments as of the date thereof, (I) no Default or Event of Default then
exists or would result therefrom and (II) either (x) the Fixed Charge Coverage
Ratio is greater than 1.0 to 1.0 or (y) Availability is greater than the higher
of 10% of the Commitments and $25,000,000.

Notwithstanding anything herein to the contrary, no Acquisition shall be
permitted to be made under this Section 6.04 unless such Acquisition constitutes
a Permitted Acquisition.

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

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

 

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(b) the Company or any Restricted Subsidiary may (i) effect any transaction
permitted by Section 6.03, Section 6.04 and Section 6.08(a) or (ii) incur any
Lien permitted under Section 6.02;

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

(d) sales, transfers and dispositions of Permitted Investments and other
investments permitted by clauses (j), (k) and (n) of Section 6.04;

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

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

(g) sales, transfers and other dispositions of assets (other than Equity
Interests in a Restricted Subsidiary unless all Equity Interests held in such
Subsidiary are sold) that are not permitted by any other paragraph of this
Section having a value of up to the sum of $15,000,000 per fiscal year in the
aggregate; provided, that such sales, transfers and other dispositions may
exceed $15,000,000 per fiscal year if and to the extent that, after giving pro
forma effect thereto, (i) no Default or Event of Default then exists or would
result therefrom, (ii) Availability is greater than $75,000,000, and (iii) the
Fixed Charge Coverage Ratio is greater than 1.15 to 1.00;

(h) sales, transfers and dispositions of (i) the Specified Properties and
(ii) Glenwood’s Equity Interests in Buyer’s Access;

(i) the Company and any Restricted Subsidiary may lease, sublease, license or
sublicense (on a non-exclusive basis with respect to any intellectual property)
real, personal or intellectual property in the ordinary course of business;

(j) the Company and any Restricted Subsidiary may make sales, transfers and
other dispositions of property (other than Inventory if an Event of Default has
occurred and is continuing) to the extent that (i) such property is exchanged
for credit against the purchase price of similar replacement property or
(ii) the proceeds of such sales, transfers and other dispositions are promptly
applied to the purchase price of such replacement property;

(k) the Company and any Restricted Subsidiary may make sales, transfers and
other dispositions of investments in joint ventures to the extent required by,
or made pursuant to customary buy/sell arrangements between, the joint venture
parties set forth in joint venture arrangements and similar binding
arrangements;

(l) the Company and any Restricted Subsidiary may sell, transfer or otherwise
dispose of, or issue Equity Interests in, Restricted Subsidiaries so long as,
after giving effect thereto, (i) the Company or a Restricted Subsidiary
continues to have an Equity Interest in such Person, (ii) the total assets of
all non-wholly owned Persons that are or were Restricted Subsidiaries, as
reflected on their most recent balance sheets prepared in accordance with GAAP,
do not in the aggregate at any time exceed $7,500,000, and (iii) the total
revenues of all non-wholly owned Persons that are or were Restricted
Subsidiaries, for the twelve-month period ending on the last day of the most
recent period for which financial statements have been delivered pursuant to
Section 5.01(a) or (b) do not in the aggregate exceed $7,500,000; and

(m) any sale, transfer or other disposition in a single transaction of fixed
assets having a value that does not exceed $2,500,000;

 

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provided that all sales, transfers, leases and other dispositions permitted
hereby (other than (x) those permitted by clauses (b), (f), (i), (j), (k) and
(m) above and (y) any sale, transfer, lease or other disposition of Notes
Priority Collateral (as defined in the Intercreditor Agreement) having a value
not exceeding $5,000,000) shall be made for fair value and for at least 75% cash
consideration; provided further, that:

(A) any liabilities of any Borrower or any Restricted Subsidiary, other than
liabilities that are by their terms subordinated to the payment in cash of the
Obligations, that are assumed by the transferee with respect to the applicable
disposition and for which such Borrower and all of the Restricted Subsidiaries
shall have been validly released by all applicable creditors in writing,

(B) any securities received by such Borrower or such Restricted Subsidiary from
such transferee that are converted by such Borrower or such Restricted
Subsidiary into cash (to the extent of the cash received) within 90 days
following the closing of the applicable disposition, and

(C) other than with respect to a disposition of Collateral of the types included
in the Borrowing Base, any Designated Non-Cash Consideration received by the
Borrowers or their Restricted Subsidiaries in respect of such disposition having
an aggregate fair market value, taken together with all other Designated
Non-Cash Consideration received pursuant to clause (C) that is at that time
outstanding, not in excess of the greater of $30,000,000 and 3.0% of
Consolidated Total Assets at the time of the receipt of such Designated Non-Cash
Consideration, with the fair market value of each item of Designated Non-Cash
Consideration being measured at the time received and without giving effect to
subsequent changes in value,

shall be deemed to be cash.

SECTION 6.06 Sale and Leaseback Transactions. No Loan Party will, nor will it
permit any Restricted Subsidiary to, enter into any arrangement, directly or
indirectly, whereby it shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereafter acquired, and
thereafter rent or lease such property or other property that it intends to use
for substantially the same purpose or purposes as the property sold or
transferred, except for (a) any such sale of any fixed or capital assets by any
Borrower or any Restricted Subsidiary that (i) is made for cash consideration in
an amount not less than the fair value, as determined at the time of
consummation by such Borrower or such Restricted Subsidiary, of such fixed or
capital asset, (ii) is consummated within 180 days after such Borrower or such
Restricted Subsidiary acquires or completes the construction of such fixed or
capital asset and (iii) the Indebtedness associated therewith is otherwise
permitted under Section 6.01(g), (b) any transaction involving the Specified
Properties and (c) any such transaction (i) that is made for cash consideration,
(ii) under which the applicable Loan Party or Restricted Subsidiary would
otherwise be permitted to enter into, and remain liable under, the applicable
underlying lease and (iii) having a fair market value that, together with the
fair market value of all other assets sold subject to all transactions under
this clause (c), would not exceed the greater of $40,000,000 and 4.0% of
Consolidated Total Assets.

SECTION 6.07 Swap Agreements. No Loan Party will, nor will it permit any
Restricted Subsidiary to, enter into any Swap Agreement, except (a) Swap
Agreements entered into to hedge or mitigate risks to which any Borrower or any
Restricted Subsidiary has actual exposure (other than those in respect of Equity
Interests of any Borrower or any of its Restricted Subsidiaries), and (b) Swap

 

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Agreements entered into in order to effectively cap, collar or exchange interest
rates (from fixed to floating rates, from one floating rate to another floating
rate or otherwise) with respect to any interest-bearing liability or investment
of any Borrower or any Restricted Subsidiary.

SECTION 6.08 Restricted Payments; Certain Payments of Indebtedness.

(a) No Loan Party will, nor will it permit any Restricted Subsidiary to, declare
or make, or agree to pay or make, directly or indirectly, any Restricted
Payment, or incur any obligation (contingent or otherwise) to do so, except:

(i) each of Holdings and each Restricted Subsidiary may declare and pay
dividends with respect to its common stock payable solely in additional shares
of its common stock;

(ii) Restricted Subsidiaries of Holdings may declare and pay dividends to
Holdings or a Restricted Subsidiary of Holdings or otherwise ratably with
respect to their Equity Interests; provided that, so long as the Administrative
Agent does not have a Lien on substantially all assets of Holdings, dividends
shall not be paid to Holdings unless such dividends are (A) for one or more of
the purposes permitted by sub-clauses (iii), (iv) or (vi) of this
Section 6.08(a) (and are promptly applied for such purposes), (B) used to make
payments on or with respect to the Holdings Notes or (C) are for other general
costs and expenses incurred by Holdings, including to make payments of the types
referred to in the definition of “Permitted Payments to Parent” to the extent
that such payments are required to be made by Holdings;

(iii) Holdings may make payments pursuant to and in accordance with stock option
plans or other benefit plans for management or employees of Holdings, the
Borrowers and their Restricted Subsidiaries in an aggregate amount not to exceed
$10,000,000 during any fiscal year; provided, that such amounts will be
increased by (A) the amount of any net cash proceeds received by or contributed
to Holdings from the issuance and sale since the Effective Date of Equity
Interests (other than Disqualified Stock) of Holdings or any Parent to its
officers, directors or employees, plus (B) the cash proceeds of key man life
insurance policies received by Holdings, its Restricted Subsidiaries or any
Parent and contributed to Holdings;

(iv) Holdings may make Permitted Payments to Parent;

(v) Holdings may make the Specified Distribution on the Effective Date; provided
that (A) Availability is greater than 20% of the Commitments before and after
giving effect thereto and to all Borrowings made and all issuances (or deemed
issuances) of Letters of Credit on the Effective Date and (B) the aggregate
amount of the proceeds of the Revolving Loans used to make the Specified
Distribution, together with any other Revolving Loans used for the purposes
described in Section 5.08(a), does not exceed $110,000,000;

(vi) after the Effective Date, Holdings may declare or make other Restricted
Payments, if, after giving pro forma effect thereto, either (A) both
(1) Availability is greater than the higher of 15% of the Commitments and
$37,500,000 and (2) the Fixed Charge Coverage Ratio for the period of four
consecutive fiscal quarters ending on the last day of the most recent fiscal
quarter or fiscal year for which financial statements have been delivered
pursuant to Section 5.01(a) or (b), as applicable, is greater than 1.0 to 1.0 or
(B) Availability is greater than the higher of 20% of the Commitments and
$50,000,000;

(vii) Holdings may redeem in whole or in part any of its Equity Interests for
another class of Equity Interests or with proceeds from substantially concurrent
equity contributions or issuances of new Equity Interests; provided that such
new Equity Interests contain terms and provisions at least as advantageous to
the Lenders in all respects material to their interests as those contained in
the Equity Interests redeemed thereby and are not Disqualified Stock.

 

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Notwithstanding clause (vi) above, if following the Effective Date Holdings
makes any payments permitted or required under the Merger Agreement in respect
of dissenting stockholders’ rights, stock options, restricted stock and
restricted share units or deferred stock, the aggregate amount of the proceeds
of the Revolving Loans used to make such Restricted Payments, together with any
other Revolving Loans used for the purposes described in Section 5.08(a), shall
not exceed $110,000,000.

(b) No Loan Party will, nor will it permit any Restricted Subsidiary to, make or
agree to pay or make, directly or indirectly, any payment or other distribution
(whether in cash, securities or other property) of or in respect of principal of
or interest on any Junior Indebtedness, or any payment or other distribution
(whether in cash, securities or other property), including any sinking fund or
similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any Junior Indebtedness
(collectively, “Restricted Debt Payments”), except:

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

(ii) refinancings of Junior Indebtedness to the extent permitted by
Section 6.01;

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

(iv) payments as part of an “applicable high yield discount obligation” catch-up
payment;

(v) (A) Restricted Debt Payments in exchange for, or with proceeds of any
issuance of Equity Interests of, any Parent or Equity Interests (that do not
constitute Disqualified Capital Stock) of Holdings, and/or with the proceeds of
any capital contribution in respect of Equity Interests (that do not constitute
Disqualified Capital Stock) of Holdings, (B) Restricted Debt Payments as a
result of the conversion of all or any portion of Restricted Debt into Equity
Interests (that do not constitute Disqualified Capital Stock) of any Parent or
Holdings and (C) to the extent constituting a Restricted Debt Payment,
payment-in-kind interest with respect to any Restricted Debt that is permitted
under Section 6.01; and

(vi) if, after giving effect thereto, either (A) both (1) Availability is
greater than the higher of 12.5% of the Commitments and $31,250,000 and (2) the
Fixed Charge Coverage Ratio for the period of four consecutive fiscal quarters
ending on the last day of the most recent fiscal quarter or fiscal year for
which financial statements have been

 

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delivered pursuant to Section 5.01(a) or (b), as applicable, (calculated on a
pro forma basis treating such prepayment, redemption, repurchase or retirement,
together with all other prepayments, redemptions, repurchases and retirements of
Indebtedness made pursuant to this clause (vi), as Fixed Charges) is greater
than 1.0 to 1.0 or (B) Availability is greater than the higher of 17.5% of the
Commitments and $43,750,000, Holdings and its Restricted Subsidiaries may
prepay, redeem, repurchase or retire any Junior Indebtedness of Holdings, the
Company or any of its Restricted Subsidiaries (including any premium (if any)
and accrued and unpaid interest thereon to the date of such repayment,
redemption, repurchase or retirement).

SECTION 6.09 Transactions with Affiliates. No Loan Party will, nor will it
permit any Restricted Subsidiary to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property or
assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) transactions that (i) are in the ordinary course of
business and (ii) are at prices and on terms and conditions not less favorable
to such Loan Party or such Restricted Subsidiary than could be obtained on an
arm’s-length basis from unrelated third parties, (b) transactions between or
among Loan Parties not involving any other Affiliate, (c) any investment
permitted by Section 6.04(c), (d) or (e), (d) any Indebtedness permitted under
Section 6.01(e), (e) any Restricted Payment permitted by Section 6.08, (f) loans
or advances to employees permitted under Section 6.04, (g) the payment of
reasonable fees to directors of any Borrower or any Restricted Subsidiary who
are not employees of such Borrower or Restricted Subsidiary, and compensation
and employee benefit arrangements paid to, and indemnities provided for the
benefit of, directors, officers or employees of the Borrowers or the Restricted
Subsidiaries in the ordinary course of business, (h) compensation and
reimbursement of expenses of officers and directors of any Loan Party, including
the issuance of Equity Interests of Holdings, in each case in the ordinary
course of business, (i) any issuances of securities or other payments, awards or
grants in cash, securities or otherwise pursuant to, or the funding of,
employment agreements, stock options and stock ownership plans approved by a
Borrower’s board of directors, (j) any sale or disposition of inventory by any
Borrower or any Restricted Subsidiary to wholly owned Foreign Subsidiaries in
the ordinary course of business, at a price not less than the cost of such
inventory, (k) the entering into of a tax sharing agreement, or payments
pursuant thereto, between Holdings and one or more Subsidiaries, on the one
hand, and any other Person with which Holdings and such Subsidiaries are
required to file a consolidated tax return or with which Holdings and such
Subsidiaries are part of a consolidated group for tax purposes, on the other
hand, (l) other than during the continuance of an Event of Default, the payment
to the Sponsors of management, monitoring and consulting fees and expenses, not
to exceed $5,000,000 in any four quarter period, (m) the payment of transaction
fees and related expenses paid to the Sponsors in connection with acquisitions,
dispositions, recapitalizations, refinancings and extraordinary transactions for
such period, not to exceed (net of reimbursable expenses) 1% of the transaction
value for any such transaction and (n) payments by Holdings or any Restricted
Subsidiary of Holdings to any of the Sponsors made for any financial advisory,
financing, underwriting or placement services or in respect of other investment
banking activities, including, without limitation, in connection with
acquisitions or divestitures which payments are approved by a majority of the
board of directors of Holdings in good faith and are at prices and on terms and
conditions not less favorable to Holdings or such Restricted Subsidiary than
could be obtained on an arm’s-length basis from unrelated third parties.

SECTION 6.10 Restrictive Agreements. No Loan Party will, nor will it permit any
Restricted Subsidiary to, directly or indirectly, enter into, incur or permit to
exist any agreement or other arrangement that prohibits, restricts or imposes
any condition upon (a) the ability of such Loan Party or any of its Restricted
Subsidiaries to create, incur or permit to exist any Lien upon any of its
property or assets other than Permitted Encumbrances, or (b) the ability of any
Restricted Subsidiary to pay dividends or other distributions with respect to
its Equity Interests or to make or repay loans or advances to any Borrower or
any other Restricted Subsidiary or to Guarantee Indebtedness of any Borrower or
any other

 

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Restricted Subsidiary; provided that (i) the foregoing shall not apply to
restrictions and conditions imposed by law or by any Loan Document, any Term
Loan Document (and any amendments, restatements, supplements or other
modifications thereto to the extent such restrictions or conditions are no more
restrictive than those on the Term Loan Closing Date) or any Holdings Notes
Document (and any amendments, restatements, supplements or other modifications
thereto to the extent such restrictions or conditions are no more restrictive
than those on the date hereof), (ii) the foregoing shall not apply to
restrictions and conditions existing on the date hereof identified on Schedule
6.10 (but shall apply to any extension or renewal of, or any amendment or
modification expanding the scope of, any such restriction or condition),
(iii) the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to the sale of a Restricted Subsidiary pending
such sale, provided such restrictions and conditions apply only to the
Restricted Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by
Section 6.01(g), (l) or (t) of this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness; provided that
any such agreements relating to secured Indebtedness permitted by
Section 6.01(t) shall not prohibit the Liens securing the Secured Obligations
and (v) clause (a) of the foregoing shall not apply to (x) customary provisions
in leases and other contracts restricting the assignment or subletting thereof
or (y) customary restrictions on dispositions of real property interests found
in reciprocal easement agreements of such Loan Party or any of its Restricted
Subsidiaries.

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

SECTION 6.12 Fixed Charge Coverage Ratio. The Borrowers will not permit the
Fixed Charge Coverage Ratio for each period of four consecutive fiscal quarters
ending during or on the date last reported before any Covenant Trigger Period to
be less than 1.00 to 1.00 (determined as of the last day of the most recent
fiscal quarter for which a Compliance Certificate has been or should have been
delivered pursuant to Section 5.01(c)).

ARTICLE VII

EVENTS OF DEFAULT

SECTION 7.01 Events of Default. If any of the following events (“Events of
Default”) shall occur:

(a) the Borrowers shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise;

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

 

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

(d) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in Section 5.01(e), 5.02(a), 5.03 (with respect to a Loan
Party’s existence), 5.08 or 5.14 or in Article VI;

(e) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in this Agreement (other than those which constitute a
default under another Section of this Article), and such failure shall continue
unremedied for a period of (i) five (5) days after the earlier of any Loan
Party’s knowledge of such breach or notice thereof from the Administrative Agent
(which notice will be given at the request of any Lender) if such breach relates
to terms or provisions of Section 5.01 (except as set forth above), 5.02 (other
than Section 5.02(a)), 5.03 (except as set forth above) through 5.07, 5.09, or
5.12 of this Agreement or (ii) thirty (30) days after the earlier of any Loan
Party’s knowledge of such breach or notice thereof from the Administrative Agent
(which notice will be given at the request of any Lender) if such breach relates
to terms or provisions of any other Section of this Agreement;

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

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

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

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

 

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

(k) one or more judgments for the payment of money in an aggregate amount in
excess of $35,000,000 (in excess of insurance provided by reputable providers
for which coverage has not been disclaimed) shall be rendered against any Loan
Party, any Restricted Subsidiary of any Loan Party or any combination thereof
and the same shall remain undischarged for a period of 30 consecutive days
during which execution shall not be effectively stayed, or any action shall be
legally taken by a judgment creditor to attach or levy upon any assets of any
Loan Party or any Restricted Subsidiary of any Loan Party to enforce any such
judgment or any Loan Party or any Restricted Subsidiary of any Loan Party shall
fail within 30 days to discharge one or more non-monetary judgments or orders
which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, which judgments or orders, in any such case, are not
stayed on appeal or otherwise being appropriately contested in good faith by
proper proceedings diligently pursued;

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

(m) a Change in Control shall occur;

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

(o) the Loan Guaranty shall fail to remain in full force or effect or any action
shall be taken by any Loan Party to discontinue or to assert the invalidity or
unenforceability of the Loan Guaranty, or any Loan Guarantor shall fail to
comply with any of the terms or provisions of the Loan Guaranty to which it is a
party, or any Loan Guarantor shall deny that it has any further liability under
the Loan Guaranty to which it is a party, or shall give notice to such effect
(or any of the foregoing shall occur with respect to a Loan Guaranty provided by
an Immaterial Subsidiary and shall continue unremedied for a period of at least
5 Business Days after receipt of written notice to the Borrower Representative
from the Administrative Agent or the Required Lenders);

(p) any Collateral Document shall for any reason fail to create a valid and
perfected first priority security interest in any Collateral purported to be
covered thereby, except as permitted by the terms of any Collateral Document, or
any Collateral Document shall fail to remain in full force or effect or any
action shall be taken by any Loan Party to discontinue or to assert the
invalidity or unenforceability of any Collateral Document, or any Loan Party
shall fail to comply with any of the terms or provisions of any Collateral
Document (or any of the foregoing shall occur with respect to Collateral
provided by an Immaterial Subsidiary and shall continue unremedied for a period
of at least 5 Business Days after receipt of written notice to the Borrower
Representative from the Administrative Agent or the Required Lenders); or

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

 

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

SECTION 7.02 Right to Cure.

(a) Notwithstanding anything to the contrary contained in Section 7.01(d), in
the event that the Borrowers fail to comply with the requirements of the
covenant set forth in Section 6.12 for any period, until the expiration of
(1) with respect to a breach of such covenant that occurs on the first day of
the Covenant Trigger Period, the date that is 10 days after such date or
(2) otherwise, the tenth (10th) day after the date on which financial statements
with respect to the relevant period for which the Fixed Charge Coverage Ratio is
being measured are required to be delivered pursuant to Section 5.01(c) (the
“Cure Period”), Holdings shall have the right to obtain a cash equity
contribution (funded with proceeds of Equity Interests that are not Disqualified
Stock issued by Holdings or other equity issued by Holdings having terms
reasonably acceptable to the Administrative Agent) (the “Cure Right”), and upon
the receipt by Holdings of net cash proceeds pursuant to the exercise of the
Cure Right (including through the capital contribution of any such net cash
proceeds to Holdings, the “Specified Equity Contribution”), the Fixed Charge
Coverage Ratio shall be recalculated, giving effect to a pro forma increase to
EBITDA for such period in an amount equal to such net cash proceeds; provided
that such pro forma adjustment to EBITDA shall be made solely for the purpose of
determining the existence of a Default or an Event of Default under the covenant
set forth in Section 6.12 with respect to any period that includes the fiscal
quarter for which such Cure Right was exercised and not for any other purpose
under any Loan Document; provided, further, that until the expiration of the
Cure Period, (i) neither the Administrative Agent nor any Lender shall have the
right to exercise any remedies against the Loan Parties or any Collateral as a
result of the occurrence and continuance of an Event of Default under
Section 7.01(d) arising from the failure to comply with Section 6.12, and then
only if a Cure Right to remedy such Event of Default is available at such time
under Section 7.02(b) and (ii) no Borrower shall have the right to any
Borrowings.

(b) If, after the exercise of the Cure Right and the recalculations pursuant to
clause (a) above, the Loan Parties shall then be in compliance with the
requirements of the covenant set forth in Section 6.12 (including for purposes
of Section 4.02), the Borrowers shall be deemed to have satisfied the
requirements of such covenant as of the relevant date of determination with the
same effect as though there had been no failure to comply therewith at such
date, and the applicable Default or Event of Default

 

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under Section 7.01(d) that had occurred shall be deemed cured; provided that
(i) in each four fiscal quarter period, there shall be at least two fiscal
quarters in which the Cure Right is not exercised, (ii) there shall be no more
than five Specified Equity Contributions during the term of this Agreement,
(iii) with respect to any exercise of the Cure Right, the Specified Equity
Contribution shall be no greater than the amount required to cause the Borrowers
to be in compliance with the covenant set forth in Section 6.12 and (iv) all
Specified Equity Contributions will be disregarded for purposes of determining
the availability of any baskets or carve-outs with respect to the covenants
contained in Article VI hereof or for any other purpose.

ARTICLE VIII

THE ADMINISTRATIVE AGENT

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

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

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

 

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

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

Subject to the appointment and acceptance of a successor Administrative Agent as
provided in this paragraph, the Administrative Agent may resign at any time by
notifying the Lenders, the Issuing Banks and the Borrower Representative. Upon
any such resignation, the Required Lenders shall have the right, with the
Company’s consent (not to be unreasonably withheld or delayed), to appoint a
successor. If no successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 30 days after the retiring
Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may, on behalf of the Lenders and the Issuing Banks,
appoint a successor Administrative Agent which shall be a commercial bank or an
Affiliate of any such commercial bank. Upon the acceptance of its appointment as
Administrative Agent hereunder by a successor, such successor shall succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. The fees payable by the
Borrowers to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrowers and such
successor. After the Administrative Agent’s resignation hereunder, the
provisions of this Article, Section 2.17(d) and Section 9.03 shall continue in
effect for the benefit of such retiring Administrative Agent, its sub-agents and
their respective Related Parties in respect of any actions taken or omitted to
be taken by any of them while it was acting as Administrative Agent.

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

Each Lender hereby agrees that (a) it has requested a copy of each Report
prepared by or on behalf of the Administrative Agent; (b) the Administrative
Agent (i) makes no representation or warranty, express or implied, as to the
completeness or accuracy of any Report or any of the information contained
therein or any inaccuracy or omission contained in or relating to a Report and
(ii) shall not be liable for any information contained in any Report; (c) the
Reports are not comprehensive audits or examinations, and that any Person
performing any field examination will inspect only specific information
regarding the Loan Parties and will rely significantly upon the Loan Parties’
books and records, as well as on representations of the Loan Parties’ personnel
and that the Administrative Agent undertakes no obligation

 

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to update, correct or supplement the Reports; (d) it will keep all Reports
confidential and strictly for its internal use, not share the Report with or any
other Person except as otherwise permitted pursuant to this Agreement or
required by applicable law, rule or regulation; and (e) without limiting the
generality of any other indemnification provision contained in this
Agreement, it will pay and protect, and indemnify, defend, and hold the
Administrative Agent and any such other Person preparing a Report harmless from
and against, the claims, actions, proceedings, damages, costs, expenses, and
other amounts (including reasonable attorney fees) incurred by as the direct or
indirect result of any third parties who might obtain all or part of any Report
through the indemnifying Lender.

Each Lender, Lead Arranger or Affiliate of a Lender or Lead Arranger that enters
into an agreement to provide Banking Services or a Swap Agreement with any Loan
Party and intends for the Banking Services Obligations or the Swap Obligations,
as applicable, resulting therefrom to constitute Secured Obligations, by
delivery of a notice to the Administrative Agent pursuant to the requirements
set forth in the definition of “Secured Obligations”, agrees to be bound by
Section 2.18(b) and this Article VIII. Each such Lender, Lead Arranger or
Affiliate of a Lender or Lead Arranger shall indemnify and hold harmless the
Administrative Agent and its Related Parties, to the extent not reimbursed by
the Loan Parties, against all claims, liabilities, obligations, losses, damages,
penalties, judgments, proceedings, interest, costs and expenses of any kind
(including remedial response costs, reasonable attorneys’ fees and all costs,
expenses or advances that the Administrative Agent may incur during a Default,
or during the pendency of a bankruptcy or insolvency proceeding of any Loan
Party) at any time (including after (a) the Commitments have expired or
terminated and the principal of and interest on each Loan and all fees, expenses
and other amounts payable under any Loan Document have been paid in full and all
Letters of Credit have expired, been cash collateralized, backstopped or
terminated and all LC Disbursements shall have been reimbursed or (b) the
replacement of the Administrative Agent or any Lender) that may be incurred by
or asserted against the Administrative Agent or any of its Related Parties in
connection with, or in any way relating to, such Lender’s, such Lead Arranger’s
or such Affiliate’s applicable Banking Services Obligations or Swap Obligations;
provided that such indemnity shall not be available to the extent such claims,
liabilities, obligations, losses, damages, penalties, judgments, proceedings,
interest, costs and expenses are determined by a court of competent jurisdiction
by a final and nonappealable judgment to have resulted from the bad faith, gross
negligence or willful misconduct of the Administrative Agent or its Related
Parties.

The Joint Bookrunners, Lead Arrangers, the Co-Documentation Agents and the
Syndication Agent shall not have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Lenders as such. To the fullest extent permitted by law, each Lender hereby
waives and releases any claims that it may have against the Joint Bookrunners,
Lead Arrangers, the Co-Documentation Agents and the Syndication Agents in their
capacities as such with respect to any breach or alleged breach of agency or
fiduciary duty to such Lender in connection with any aspect of any transaction
contemplated hereby.

ARTICLE IX

MISCELLANEOUS

SECTION 9.01 Notices. (a) Except in the case of notices and other communications
expressly permitted to be given by telephone (and subject to paragraph
(b) below), all notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by facsimile, as follows:

(i) if to any Loan Party, to the Borrower Representative at:

701 San Marco Boulevard

Jacksonville, FL 32207

Attention: Treasurer

Facsimile No: (856) 505-1679

 

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with a copy to:    Fried, Frank, Harris, Shriver & Jacobson LLP    One New York
Plaza    New York, NY 10004    Attention: F. William Reindel    Facsimile No:
(212) 859-4000

(ii) if to the Administrative Agent, BofA, as an Issuing Bank or the Swingline
Lender, to Bank of America, N.A. at:

300 Galleria Parkway, Suite 800

Atlanta, Georgia 30339

Attention: John M. Olsen

Telephone No: (404) 607-3218

Facsimile No: (404) 607-3277

Email: john.m.olsen@baml.com

(iii) if to any other Lender, to it at its address or facsimile number set forth
in its Administrative Questionnaire.

All such notices and other communications (i) sent by hand or overnight courier
service, or mailed by certified or registered mail, shall be deemed to have been
given when received or (ii) sent by facsimile shall be deemed to have been given
when sent, provided that if not given during normal business hours for the
recipient, shall be deemed to have been given at the opening of business on the
next Business Day for the recipient.

(b) Notices and other communications to the Lenders hereunder may be delivered
or furnished by electronic communications (including e-mail and internet or
intranet websites) pursuant to procedures approved by the Administrative Agent;
provided that the foregoing shall not apply to notices pursuant to Article II or
default notices unless otherwise agreed by the Administrative Agent and the
applicable Lender. The Administrative Agent or the Borrower Representative (on
behalf of the Loan Parties) may, in its discretion, agree to accept notices and
other communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications. All such notices and other
communications (i) sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if not given during the normal business
hours of the recipient, such notice or communication shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient, and (ii) posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail address
as described in the foregoing clause (b)(i) of notification that such notice or
communication is available and identifying the website address therefor.

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

 

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SECTION 9.02 Waivers; Amendments. (a) No failure or delay by the Administrative
Agent, any Issuing Bank or any Lender in exercising any right or power hereunder
or under any other Loan Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Issuing Banks and the Lenders
hereunder and under any other Loan Document are cumulative and are not exclusive
of any rights or remedies that they would otherwise have. No waiver of any
provision of any Loan Document or consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, any Lender or any
Issuing Bank may have had notice or knowledge of such Default at the time.

(b) Neither this Agreement nor any other Loan Document nor any provision hereof
or thereof may be waived, amended or modified except (1) in the case of this
Agreement, pursuant to an agreement or agreements in writing entered into by the
Borrowers and the Required Lenders or, (2) in the case of any other Loan
Document, pursuant to an agreement or agreements in writing entered into by the
Administrative Agent and the Loan Party or Loan Parties that are parties
thereto, with the consent of the Required Lenders; provided that no such
agreement shall (i) increase the Commitment of any Lender without the written
consent of such Lender, (ii) reduce or forgive the principal amount of any Loan
or LC Disbursement or reduce the rate of interest thereon (other than default
interest), or reduce or forgive any interest (other than default interest) or
fees payable hereunder, without the written consent of each Lender directly
affected thereby, (iii) postpone any scheduled date of payment of the principal
amount of any Loan or LC Disbursement, or any date for the payment of any
interest, fees or other Obligations payable hereunder, or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date of expiration
of any Commitment, without the written consent of each Lender directly affected
thereby, (iv) change Section 2.18(b) or (d) in a manner that would alter the
manner in which payments are shared (except such changes that provide for
different interest rates, commitment fees or other fees or separate tranches of
Loans for consenting and non-consenting Lenders, in each case, in connection
with the extension of the Maturity Date), without the written consent of each
Lender, (v) increase any Borrowing Base advance rates without the written
consent of the Supermajority Lenders, (vi) add new categories of eligible assets
to the Borrowing Base or modify that portion of Section 2.01 which limits the
amount that can be borrowed, without the written consent of the Supermajority
Lenders (but a modification to such portion of Section 2.01 that would allow the
amount that can be borrowed to exceed the Commitments shall require the written
consent of each Lender) (vii) change the definition of “Covenant Trigger Period”
or “Dominion Trigger Period” without the written consent of the Supermajority
Lenders, (viii) change any of the provisions of this Section or the definition
of “Required Lenders” or “Supermajority Lenders” or any other provision of any
Loan Document specifying the number or percentage of Lenders (or Lenders of any
Class) required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender, (ix) change Section 2.20, without the consent of each Lender (other
than any Defaulting Lender), (x) release Loan Guarantors from their obligation
under the Loan Guaranty constituting all or substantially all of the value of
the guarantees (except as otherwise permitted herein or in the other Loan
Documents), without the written consent of each Lender, or (xi) except as
provided in clause (c) of this Section or in any Collateral Document, release
all or substantially all of the Collateral or subordinate Agent’s Liens on all
or substantially all of the Collateral, without the written consent of each
Lender (it being understood that amendments to the Intercreditor Agreement shall
only require the consent of the Required Lenders); provided further that no such
agreement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent, any Issuing Bank or the Swingline Lender hereunder without
the prior written

 

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consent of the Administrative Agent, such Issuing Bank or the Swingline Lender,
as the case may be (it being understood that any change to Section 2.20 shall
require the consent of the Administrative Agent, the Swingline Lender and each
Issuing Bank). The Administrative Agent may also amend the Commitment Schedule
(A) to reflect assignments entered into pursuant to Section 9.04 and (B) as
permitted under Section 2.09(g).

(c) The Administrative Agent shall, and is hereby irrevocably authorized and
directed by the Lenders to, release any Liens granted to the Administrative
Agent by the Loan Parties on any Collateral (i) upon the termination of the
Commitments, payment and satisfaction in full in cash of all Secured Obligations
(other than Unliquidated Obligations), and the cash collateralization of all
Unliquidated Obligations in a manner satisfactory to each affected Lender and
Issuing Bank, (ii) constituting property being sold or disposed of in compliance
with the terms of this Agreement and if the Loan Party disposing of such
property so certifies to the Administrative Agent (and the Administrative Agent
may rely conclusively on any such certificate, without further inquiry), and to
the extent that the property being sold or disposed of constitutes any portion
of the Equity Interest of a Restricted Subsidiary, the Administrative Agent is
authorized to release any Loan Guaranty provided by such Restricted Subsidiary,
so long as any Guarantee by such Restricted Subsidiary of the Company Notes is
also released, or (iii) constituting property leased to a Loan Party under a
lease which has expired or been terminated in a transaction permitted under this
Agreement. The Lenders hereby further authorize the Administrative Agent, at its
option and its sole discretion, to release any Liens granted to the
Administrative Agent by the Loan Parties on any Collateral as required to effect
any sale or other disposition of such Collateral in connection with any exercise
of remedies of the Administrative Agent and the Lenders pursuant to
Section 7.01. Except as provided in the preceding sentence, the Administrative
Agent will not release any Liens on Collateral without the prior written
authorization of the Required Lenders; provided that, the Administrative Agent
may in its discretion, release its Liens on Collateral valued in the aggregate
not in excess of $25,000,000 (but not in excess of $10,000,000 with respect to
Collateral of a type included in the Borrowing Base) during any calendar year
without the prior written authorization of the Required Lenders. Any such
release shall not in any manner discharge, affect, or impair the Obligations or
any Liens (other than those expressly being released) upon (or obligations of
the Loan Parties in respect of) all interests retained by the Loan Parties,
including the proceeds of any sale, all of which shall continue to constitute
part of the Collateral. In connection with any termination or release pursuant
to this Section, the Administrative Agent shall reasonably promptly execute and
deliver to any Loan Party, at such Loan Party’s expense, all documents that such
Loan Party shall reasonably request to evidence such termination or release.
Provided that no Default has occurred and is continuing, the Lenders also hereby
irrevocably authorize the Administrative Agent to (A) enter into the
Intercreditor Agreement (with such immaterial changes to the form set forth on
Exhibit I as the Administrative Agent may deem appropriate) and (B) subordinate
its Liens on the Notes Priority Collateral (as defined in Exhibit I) to Liens
permitted under Section 6.02(l).

(d) If, in connection with any proposed amendment, waiver or consent requiring
(i) the consent of “each Lender” or “each Lender affected thereby,” or (ii) the
Supermajority Lenders, the consent of the Required Lenders is obtained, but the
consent of other necessary Lenders is not obtained (any such Lender whose
consent is necessary but not obtained being referred to herein as a
“Non-Consenting Lender”), then the Administrative Agent or the Borrowers may
elect to replace a Non-Consenting Lender as a Lender party to this Agreement,
provided that, concurrently with such replacement, (i) another bank or other
entity which is reasonably satisfactory to the Borrowers and the Administrative
Agent shall agree, as of such date, to purchase for cash the Loans and other
Obligations due to the Non-Consenting Lender pursuant to an Assignment and
Acceptance and to become a Lender for all purposes under this Agreement and to
assume all obligations of the Non-Consenting Lender to be terminated as of such
date and to comply with the requirements of clause (b) of Section 9.04, and
(ii) the Borrowers shall pay to such Non-Consenting Lender in same day funds on
the day of such replacement (1)

 

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all interest, fees and other amounts then accrued but unpaid to such
Non-Consenting Lender by the Borrowers hereunder to and including the date of
termination, including without limitation payments due to such Non-Consenting
Lender under Sections 2.15 and 2.17, and (2) an amount, if any, equal to the
payment which would have been due to such Lender on the day of such replacement
under Section 2.16 had the Loans of such Non-Consenting Lender been prepaid on
such date rather than sold to the replacement Lender.

SECTION 9.03 Expenses; Indemnity; Damage Waiver. (a) The Borrowers shall pay
(i) all reasonable out-of-pocket expenses incurred by the Administrative Agent,
each Lead Arranger and their respective Affiliates (the “Agent/Arranger
Persons”), including the reasonable fees, charges and disbursements of one
counsel for the Agent/Arranger Persons and to the extent necessary, one special
or local counsel in each appropriate jurisdiction (absent a conflict of
interest, in which case the Agent/Arranger Persons may engage and be reimbursed
for additional counsel), in connection with the syndication and distribution
(including, without limitation, via the internet or through a service such as
Intralinks) of the credit facilities provided for herein, the preparation and
administration of the Loan Documents or any amendments, modifications or waivers
of the provisions of the Loan Documents and in connection with the enforcement,
collection or protection of its rights in connection with the Loan Documents,
including its rights under this Section, or in connection with the Loans made or
Letters of Credit issued hereunder, including all such out-of-pocket expenses
incurred during any workout, restructuring or negotiations in respect of such
Loans or Letters of Credit (whether or not the transactions contemplated hereby
or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses
incurred by any Issuing Bank in connection with the issuance, amendment, renewal
or extension of any Letter of Credit or any demand for payment thereunder and
(iii) all out-of-pocket expenses incurred by any Issuing Bank or any Lender
during the continuance of an Event of Default, including the fees, charges and
disbursements of one counsel for the Issuing Bank and the Lenders and to the
extent necessary, one special or local counsel in each appropriate jurisdiction
(absent a conflict of interest, in which case the Issuing Bank and the Lenders
may engage and be reimbursed for additional counsel), in connection with the
enforcement, collection or protection of its rights in connection with the Loan
Documents, including its rights under this Section, or in connection with the
Loans made or Letters of Credit issued hereunder, and with respect to each
Issuing Bank and Lender, all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit. Expenses being reimbursed by the Borrowers under this Section include,
without limiting the generality of the foregoing, costs and expenses incurred in
connection with:

(i) appraisals and insurance reviews;

(ii) field examinations and the preparation of Reports based on the fees charged
by a third party retained by the Administrative Agent or the internally
allocated fees for each Person employed by the Administrative Agent with respect
to each field examination, together with the reasonable fees and expenses
associated with collateral monitoring services performed by the Administrative
Agent (and the Borrowers agree to modify or adjust the computation of the
Borrowing Base — which may include maintaining additional Reserves — to the
extent required by the Administrative Agent as a result of any such evaluation,
appraisal or monitoring);

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

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

 

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

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

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

(b) The Borrowers and the Loan Guarantors shall, jointly and severally,
indemnify the Administrative Agent, each Issuing Bank, each Lead Arranger and
each Lender, and each Related Party (other than Permitted Holders) of any of the
foregoing Persons (each such Person being called an “Indemnitee”) against, and
hold each Indemnitee harmless from, any and all losses, claims, damages,
penalties, liabilities and related expenses (including the reasonable fees,
charges and disbursements of one counsel for all Indemnitees and one firm of
local counsel and regulatory counsel in each appropriate jurisdiction, which may
include a single special counsel acting in multiple jurisdictions, for all
Indemnitees and, in the case of an actual or potential conflict of interest
where the Indemnitee affected by such conflict informs Borrowers and thereafter
retains its own counsel, of another firm of counsel for such affected
Indemnitee) incurred by or asserted against any Indemnitee (regardless of
whether such Indemnitee is a party hereto) arising out of, in connection with,
or as a result of (i) the execution or delivery of the Loan Documents or any
agreement or instrument contemplated thereby, the performance by the parties
hereto of their respective obligations thereunder or the consummation of the
Transactions or any other transactions contemplated hereby (but excluding any
losses, liabilities, claims, damages or expenses relating to the matters
referred to in Section 2.15 and 2.16, which shall be the sole remedy in respect
of the matters set forth therein), (ii) any Loan or Letter of Credit or the use
of the proceeds therefrom (including any refusal by an Issuing Bank to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such Letter
of Credit), (iii) any actual or alleged presence or release of Hazardous
Materials on or from any property owned or operated by any Borrower or any of
the Restricted Subsidiaries, or any Environmental Liability related in any way
to any Borrower or any of the Restricted Subsidiaries, (iv) the failure of the
Borrowers to deliver to the Administrative Agent the required receipts or other
required documentary evidence with respect to a payment made by the Borrowers
for Taxes pursuant to Section 2.17, 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 and regardless of whether
any Indemnitee is a party thereto and whether or not such proceeding is
instituted or brought on behalf of a third party or by any Loan Party or any of
its respective Affiliates; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
penalties, liabilities or related expenses are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
(A) the bad faith, gross negligence or willful misconduct of such Indemnitee or
its controlled Affiliates (other than the Permitted Holders), officers,
directors, employees, agents or controlling persons acting in connection with
the Transactions, (B) a material breach of an express obligation of such
Indemnitee or one of its controlled Affiliates (other than any Permitted Holder)
and (C) any dispute between and among Indemnitees that does not involve an act
or omission by the Borrowers or their Affiliates (other than any claims against
any of the Administrative Agent, Lead Arrangers, Joint Bookrunners or any
similar role hereunder in its capacity or in fulfilling its role as such). This
Section 9.03(b) shall not apply with respect to Taxes other than any Taxes that
represent losses, claims, damages, etc. arising from any non-Tax claim.

(c) To the extent that the Borrowers or Loan Guarantors fail to pay any amount
required to be paid by them to the Administrative Agent, any Issuing Bank or the
Swingline Lender under paragraph (a)

 

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

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

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

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

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

(A) the Borrower Representative (which consent shall be deemed given if no
objection is made within five Business Days after notice of the proposed
assignment), provided that no consent of the Borrower Representative shall be
required for an assignment to a Lender, an Affiliate of a Lender, an Approved
Fund or, if an Event of Default has occurred and is continuing, any other
assignee;

(B) the Administrative Agent; provided that no consent of the Administrative
Agent shall be required for an assignment to a Lender, an Affiliate of a Lender
or an Approved Fund; and

(C) each Issuing Bank and Swingline Lender.

 

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

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

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;

(C) the parties to each assignment shall deliver to the Administrative Agent the
Assignment Notice duly executed by the assigning Lender, the assignee, the
Administrative Agent, each Issuing Bank, the Swingline Lender and, if
applicable, the Borrower Representative, together with a processing and
recordation fee of $3,500; and

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

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

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

(i) Subject to acceptance and recording thereof pursuant to paragraph (b)(iii)
of this Section, from and after the effective date specified in each Assignment
Notice the assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by the applicable Assignment and Acceptance, 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
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 2.15,
2.16, 2.17 and 9.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 9.04
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section.

 

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(ii) The Administrative Agent, acting for this purpose as an agent of the
Borrowers, shall maintain at one of its offices a copy of each Assignment Notice
delivered to it and a register for the recordation of the names and addresses of
the Lenders, and the Commitment of, and principal amounts (and stated interest)
of the Loans and LC Disbursements owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”). The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrowers, the
Administrative Agent, the Issuing Banks and the Lenders shall 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. Any assignment of any Loan,
whether or not evidenced by a note, shall be effective only upon appropriate
entries with respect thereto being made in the Register (and each note shall
expressly so provide). The Register shall be available for inspection by the
Borrowers, any Issuing Bank and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.

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

(c) Any Lender may, without the consent of the Borrowers, the Administrative
Agent, any Issuing Bank or the Swingline Lender, sell participations to one or
more banks or other entities (a “Participant”) in all or a portion of such
Lender’s rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans owing to it); provided that (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 Borrowers, the Administrative Agent, the Issuing
Banks and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, modification or waiver described in the first proviso to
Section 9.02(b) that affects such Participant. The Borrowers agree that each
Participant shall be entitled to the benefits of Sections 2.15, 2.16 and 2.17 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section; provided that such
Participant (A) agrees to be subject to the provisions of Section 2.19 as if it
were an assignee under paragraph (b) of this Section 9.04; and (B) shall not be
entitled to receive any greater payment under Section 2.15 or 2.17, with respect
to any participation, than its participating Lender would

 

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have been entitled to receive, except to the extent such entitlement to receive
a greater payment results from a Change in Law that occurs after the Participant
acquired the applicable participation. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 9.08 as though it
were a Lender, provided such Participant agrees to be subject to Section 2.18(d)
as though it were a Lender. Each Lender that sells a participation shall, acting
solely for this purpose as a non-fiduciary agent of the Borrower, maintain a
register on which it enters the name and address of each Participant and the
principal amounts (and stated interest) of each Participant’s interest in the
Loans or other obligations under the Loan Documents (the “Participant
Register”); provided that no Lender shall have any obligation to disclose all or
any portion of the Participant Register (including the identity of any
Participant or any information relating to a Participant’s interest in any
commitments, loans, letters of credit or its other obligations under any Loan
Document) to any Person except to the extent that such disclosure is necessary
to establish that such commitment, loan, letter of credit or other obligation is
in registered form under Section 5f.103-1(c) of the United States Treasury
Regulations. The entries in the Participant Register shall be conclusive absent
manifest error, and such Lender shall treat each Person whose name is recorded
in the Participant Register as the owner of such participation for all purposes
of this Agreement notwithstanding any notice to the contrary. For the avoidance
of doubt, the Administrative Agent (in its capacity as Administrative Agent)
shall have no responsibility for maintaining a Participant Register.

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

(e) No assignment or participation may be made to any Permitted Holder, Borrower
or Affiliate of any Borrower except to the entities listed in Schedule 9.04(e).

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

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

 

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counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.
Delivery of an executed counterpart of a signature page of this Agreement by
facsimile (or other electronic) transmission shall be effective as delivery of a
manually executed counterpart of this Agreement.

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

SECTION 9.08 Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other obligations at any time owing by such
Lender or Affiliate to or for the credit or the account of the Borrowers or such
Loan Guarantor against any of and all the Secured Obligations held by such
Lender, irrespective of whether or not such Lender shall have made any demand
under the Loan Documents and although such obligations may be unmatured;
provided, that no amount received pursuant to this Section 9.08 from any Loan
Party shall be applied to the Excluded Swap Obligations of any Loan Party. The
applicable Lender shall notify the Borrower Representative and the
Administrative Agent of such set-off or application, provided that any failure
to give or any delay in giving such notice shall not affect the validity of any
such set-off or application under this Section. The rights of each Lender under
this Section are in addition to other rights and remedies (including other
rights of setoff) which such Lender may have.

SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process. (a) The
Loan Documents (other than those containing a contrary express choice of law
provision) shall be governed by and construed in accordance with the laws of the
State of New York, but giving effect to federal laws applicable to national
banks.

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

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

 

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

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

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

SECTION 9.12 Confidentiality. Each of the Administrative Agent, the Issuing
Banks and the Lenders agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its and its
Affiliates’ directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
Requirement of Law or by any subpoena or similar legal process, (d) to any other
party to this Agreement, (e) in connection with the exercise of any remedies
hereunder or any suit, action or proceeding relating to this Agreement or any
other Loan Document or the enforcement of rights hereunder or thereunder,
(f) subject to an agreement containing provisions substantially the same as
those of this Section, to (i) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Loan Parties and
their obligations, (g) with the prior written consent of the Borrower
Representative or (h) to the extent such Information (i) becomes publicly
available other than as a result of a breach of this Section or (ii) becomes
available to the Administrative Agent, any Issuing Bank or any Lender on a
non-confidential basis from a source other than the Borrowers. For the purposes
of this Section, “Information” means all information received from the Borrowers
relating to the Borrowers or their business, other than any such information
that is available to the Administrative Agent, any Issuing Bank or any Lender on
a non-confidential basis prior to disclosure by the Borrowers. 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 LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.12 FURNISHED
TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION
CONCERNING THE COMPANY AND ITS AFFILIATES AND THEIR RELATED PARTIES OR THEIR
RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES
REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE
SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND
APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

 

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ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE
BORROWERS OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF
ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY
CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE COMPANY, THE LOAN PARTIES AND
THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. ACCORDINGLY, EACH LENDER
REPRESENTS TO THE BORROWERS AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED
IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION
THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS
COMPLIANCE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES
LAWS.

SECTION 9.13 Several Obligations; Nonreliance; Violation of Law. The respective
obligations of the Lenders hereunder are several and not joint and the failure
of any Lender to make any Loan or perform any of its obligations hereunder shall
not relieve any other Lender from any of its obligations hereunder. Each Lender
hereby represents that it is not relying on or looking to any margin stock for
the repayment of the Borrowings provided for herein. Anything contained in this
Agreement to the contrary notwithstanding, no Issuing Bank nor any Lender shall
be obligated to extend credit to the Borrowers in violation of any Requirement
of Law.

SECTION 9.14 USA PATRIOT Act. Each Lender that is subject to the requirements of
the Patriot Act hereby notifies the Loan Parties that pursuant to the
requirements of the Act, it is required to obtain, verify and record information
that identifies each Loan Party, which information includes the names and
addresses of each Loan Party and other information that will allow such Lender
to identify each Loan Party in accordance with the Act.

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

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

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

 

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SECTION 9.18 No Advisory or Fiduciary Duty. In connection with all aspects of
each transaction contemplated hereby (including in connection with any
amendment, waiver or other modification hereof or of any other Loan Document),
each Loan Party acknowledges and agrees, and acknowledges its Affiliates’
understanding, that: (a) (i) the arranging and other services regarding this
Agreement provided by the Administrative Agent and the Lead Arrangers are
arm’s-length commercial transactions between the Loan Parties and their
respective Affiliates, on the one hand, and the Administrative Agent and the
Lead Arrangers, on the other hand, (ii) each of the Loan Parties has consulted
its own legal, accounting, regulatory and tax advisors to the extent it has
deemed appropriate, and (iii) each of the Loan Parties is capable of evaluating,
and understands and accepts, the terms, risks and conditions of the transactions
contemplated hereby and by the other Loan Documents; (b) (i) the Administrative
Agent and the Lead Arrangers each is and has been acting solely as a principal
and, except as expressly agreed in writing by the relevant parties, has not
been, is not, and will not be acting as an advisor, agent or fiduciary for the
Loan Parties or any of their respective Affiliates, or any other Person and
(ii) neither the Administrative Agent nor either Lead Arranger has any
obligation to the Loan Parties or any of their respective Affiliates with
respect to the transactions contemplated hereby except those obligations
expressly set forth herein and in the other Loan Documents; and (c) the
Administrative Agent and the Lead Arrangers and their respective Affiliates may
be engaged in a broad range of transactions that involve interests that differ
from those of the Loan Parties and their respective Affiliates, and neither the
Administrative Agent nor either Lead Arranger has any obligation to disclose any
of such interests to the Borrowers or any of their respective Affiliates. To the
fullest extent permitted by law, each Loan Party hereby waives and releases any
claims that it may have against the Administrative Agent and the Lead Arrangers
with respect to any breach or alleged breach of agency or fiduciary duty to such
Loan Party or its Affiliates in connection with any aspect of any transaction
contemplated hereby.

ARTICLE X

LOAN GUARANTY

SECTION 10.01 Guaranty. Each Loan Guarantor (other than those that have
delivered a separate Guaranty) hereby agrees that it is jointly and severally
liable for, and absolutely and unconditionally guarantees to the Administrative
Agent, each Issuing Bank and the Lenders, the prompt payment when due, whether
at stated maturity, upon acceleration or otherwise, and at all times thereafter,
of the Secured Obligations and all costs and expenses including, without
limitation, all court costs and attorneys’ and paralegals’ fees (including
allocated costs of in-house counsel and paralegals) and expenses paid or
incurred by the Administrative Agent, the Issuing Banks and the Lenders in
endeavoring to collect all or any part of the Secured Obligations from, or in
prosecuting any action against, any Borrower, any Loan Guarantor or any other
guarantor of all or any part of the Secured Obligations (such costs and
expenses, together with the Secured Obligations, collectively the “Guaranteed
Obligations”). Each Loan Guarantor further agrees that the Guaranteed
Obligations may be extended or renewed in whole or in part without notice to or
further assent from it, and that it remains bound upon its guarantee
notwithstanding any such extension or renewal. All terms of this Loan Guaranty
apply to and may be enforced by or on behalf of any domestic or foreign branch
or Affiliate of any Lender that extended any portion of the Guaranteed
Obligations.

SECTION 10.02 Guaranty of Payment. This Loan Guaranty is a guaranty of payment
and not of collection. Each Loan Guarantor waives any right to require the
Administrative Agent, any Issuing Bank or any Lender to sue any Borrower, any
Loan Guarantor, any other guarantor, or any other person obligated for all or
any part of the Guaranteed Obligations (each, an “Obligated Party”), or
otherwise to enforce its payment against any collateral securing all or any part
of the Guaranteed Obligations.

 

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SECTION 10.03 No Discharge or Diminishment of Loan Guaranty. (a) Except as
otherwise provided for herein, the obligations of each Loan Guarantor hereunder
are unconditional and absolute and not subject to any reduction, limitation,
impairment or termination for any reason (other than the indefeasible payment in
full in cash of the Guaranteed Obligations), including: (i) any claim of waiver,
release, extension, renewal, settlement, surrender, alteration, or compromise of
any of the Guaranteed Obligations, by operation of law or otherwise; (ii) any
change in the corporate existence, structure or ownership of any Borrower or any
other guarantor of or other person liable for any of the Guaranteed Obligations;
(iii) any insolvency, bankruptcy, reorganization or other similar proceeding
affecting any Obligated Party, or their assets or any resulting release or
discharge of any obligation of any Obligated Party; or (iv) the existence of any
claim, setoff or other rights which any Loan Guarantor may have at any time
against any Obligated Party, the Administrative Agent, any Issuing Bank, any
Lender, or any other person, whether in connection herewith or in any unrelated
transactions.

(b) The obligations of each Loan Guarantor hereunder are not subject to any
defense or setoff, counterclaim, recoupment, or termination whatsoever by reason
of the invalidity, illegality, or unenforceability of any of the Guaranteed
Obligations or otherwise, or any provision of applicable law or regulation
purporting to prohibit payment by any Obligated Party, of the Guaranteed
Obligations or any part thereof.

(c) Further, the obligations of any Loan Guarantor hereunder are not discharged
or impaired or otherwise affected by: (i) the failure of the Administrative
Agent, any Issuing Bank or any Lender to assert any claim or demand or to
enforce any remedy with respect to all or any part of the Guaranteed
Obligations; (ii) any waiver or modification of or supplement to any provision
of any agreement relating to the Guaranteed Obligations; (iii) any release,
non-perfection, or invalidity of any indirect or direct security for the
obligations of any Borrower for all or any part of the Guaranteed Obligations or
any obligations of any other guarantor of or other person liable for any of the
Guaranteed Obligations; (iv) any action or failure to act by the Administrative
Agent, any Issuing Bank or any Lender with respect to any collateral securing
any part of the Guaranteed Obligations; or (v) any default, failure or delay,
willful or otherwise, in the payment or performance of any of the Guaranteed
Obligations, or any other circumstance, act, omission or delay that might in any
manner or to any extent vary the risk of such Loan Guarantor or that would
otherwise operate as a discharge of any Loan Guarantor as a matter of law or
equity (other than the indefeasible payment in full in cash of the Guaranteed
Obligations).

SECTION 10.04 Defenses Waived. To the fullest extent permitted by applicable
law, each Loan Guarantor hereby waives any defense based on or arising out of
any defense of any Borrower or any Loan Guarantor or the unenforceability of all
or any part of the Guaranteed Obligations from any cause, or the cessation from
any cause of the liability of any Borrower or any Loan Guarantor, other than the
indefeasible payment in full in cash of the Guaranteed Obligations. Without
limiting the generality of the foregoing, each Loan Guarantor irrevocably waives
acceptance hereof, presentment, demand, protest and, to the fullest extent
permitted by law, any notice not provided for herein, as well as any requirement
that at any time any action be taken by any person against any Obligated Party,
or any other person. Each Loan Guarantor confirms that it is not a surety under
any state law and shall not raise any such law as a defense to its obligations
hereunder. The Administrative Agent may, at its election, foreclose on any
Collateral held by it by one or more judicial or nonjudicial sales, accept an
assignment of any such Collateral in lieu of foreclosure or otherwise act or
fail to act with respect to any collateral securing all or a part of the
Guaranteed Obligations, compromise or adjust any part of the Guaranteed
Obligations, make any other accommodation with any Obligated Party or exercise
any other right or remedy available to it against any Obligated Party, without
affecting or impairing in any way the liability of such Loan

 

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Guarantor under this Loan Guaranty except to the extent the Guaranteed
Obligations have been fully and indefeasibly paid in cash. To the fullest extent
permitted by applicable law, each Loan Guarantor waives any defense arising out
of any such election even though that election may operate, pursuant to
applicable law, to impair or extinguish any right of reimbursement or
subrogation or other right or remedy of any Loan Guarantor against any Obligated
Party or any security.

SECTION 10.05 Rights of Subrogation. No Loan Guarantor will assert any right,
claim or cause of action, including, without limitation, a claim of subrogation,
contribution or indemnification that it has against any Obligated Party, or any
collateral, until the Loan Parties and the Loan Guarantors have fully performed
all their obligations to the Administrative Agent, the Issuing Banks and the
Lenders.

SECTION 10.06 Reinstatement; Stay of Acceleration. If at any time any payment of
any portion of the Guaranteed Obligations is rescinded or must otherwise be
restored or returned upon the insolvency, bankruptcy, or reorganization of any
Borrower or otherwise, each Loan Guarantor’s obligations under this Loan
Guaranty with respect to that payment shall be reinstated at such time as though
the payment had not been made and whether or not the Administrative Agent, the
Issuing Banks and the Lenders are in possession of this Loan Guaranty. If
acceleration of the time for payment of any of the Guaranteed Obligations is
stayed upon the insolvency, bankruptcy or reorganization of any Borrower, all
such amounts otherwise subject to acceleration under the terms of any agreement
relating to the Guaranteed Obligations shall nonetheless be payable by the Loan
Guarantors forthwith on demand by the Lender.

SECTION 10.07 Information. Each Loan Guarantor assumes all responsibility for
being and keeping itself informed of the Borrowers’ financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Guaranteed Obligations and the nature, scope and extent of the risks that
each Loan Guarantor assumes and incurs under this Loan Guaranty, and agrees that
neither the Administrative Agent, any Issuing Bank nor any Lender shall have any
duty to advise any Loan Guarantor of information known to it regarding those
circumstances or risks.

SECTION 10.08 Taxes. All payments of the Guaranteed Obligations will be made by
each Loan Guarantor free and clear of and without deduction for any Indemnified
Taxes or Other Taxes; provided that if any Loan Guarantor shall be required to
deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) the Administrative Agent, Lender or applicable Issuing Bank (as
the case may be) receives an amount equal to the sum it would have received had
no such deductions been made, (ii) such Loan Guarantor shall make such
deductions and (iii) such Loan Guarantor shall pay the full amount deducted to
the relevant Governmental Authority in accordance with applicable law.

SECTION 10.09 Maximum Liability. The provisions of this Loan Guaranty are
severable, and in any action or proceeding involving any state corporate law, or
any state, federal or foreign bankruptcy, insolvency, reorganization or other
law affecting the rights of creditors generally, if the obligations of any Loan
Guarantor under this Loan Guaranty would otherwise be held or determined to be
avoidable, invalid or unenforceable on account of the amount of such Loan
Guarantor’s liability under this Loan Guaranty, then, notwithstanding any other
provision of this Loan Guaranty to the contrary, the amount of such liability
shall, without any further action by the Loan Guarantors or the Lenders, be
automatically limited and reduced to the highest amount that is valid and
enforceable as determined in such action or proceeding (such highest amount
determined hereunder being the relevant Loan Guarantor’s “Maximum Liability”).
This Section with respect to the Maximum Liability of each Loan Guarantor is
intended solely to preserve the rights of the Lenders to the maximum extent not
subject to avoidance under applicable law, and no Loan Guarantor nor any other
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right or claim under this Section with respect to such Maximum Liability, except
to the extent necessary so that the obligations of any Loan Guarantor hereunder
shall not be rendered voidable under applicable law. Each Loan Guarantor agrees
that the Guaranteed Obligations may at any time and from time to time exceed the
Maximum Liability of each Loan Guarantor without impairing this Loan Guaranty or
affecting the rights and remedies of the Lenders hereunder, provided that,
nothing in this sentence shall be construed to increase any Loan Guarantor’s
obligations hereunder beyond its Maximum Liability. Notwithstanding anything to
the contrary herein, all Borrowers shall be liable for all Loans made to them
without reduction.

SECTION 10.10 Contribution. In the event any Loan Guarantor (a “Paying
Guarantor”) shall make any payment or payments under this Loan Guaranty or shall
suffer any loss as a result of any realization upon any collateral granted by it
to secure its obligations under this Loan Guaranty, each other Loan Guarantor
(each a “Non-Paying Guarantor”) shall contribute to such Paying Guarantor an
amount equal to such Non-Paying Guarantor’s “Guarantor Percentage” of such
payment or payments made, or losses suffered, by such Paying Guarantor. For
purposes of this Article X, each Non-Paying Guarantor’s “Guarantor Percentage”
with respect to any such payment or loss by a Paying Guarantor shall be
determined as of the date on which such payment or loss was made by reference to
the ratio of (i) such Non-Paying Guarantor’s Maximum Liability as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder) or, if such Non-Paying Guarantor’s Maximum Liability has
not been determined, the aggregate amount of all monies received by such
Non-Paying Guarantor from the Borrowers after the date hereof (whether by loan,
capital infusion or by other means) to (ii) the aggregate Maximum Liability of
all Loan Guarantors hereunder (including such Paying Guarantor) as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder), or to the extent that a Maximum Liability has not been
determined for any Loan Guarantor, the aggregate amount of all monies received
by such Loan Guarantors from the Borrowers after the date hereof (whether by
loan, capital infusion or by other means). Nothing in this provision shall
affect any Loan Guarantor’s several liability for the entire amount of the
Guaranteed Obligations (up to such Loan Guarantor’s Maximum Liability). Each of
the Loan Guarantors covenants and agrees that its right to receive any
contribution under this Loan Guaranty from a Non-Paying Guarantor shall be
subordinate and junior in right of payment to the payment in full in cash of the
Guaranteed Obligations. This provision is for the benefit of both the
Administrative Agent, the Issuing Banks, the Lenders and the Loan Guarantors and
may be enforced by any one, or more, or all of them in accordance with the terms
hereof.

SECTION 10.11 Liability Cumulative. The liability of each Loan Party as a Loan
Guarantor under this Article X is in addition to and shall be cumulative with
all liabilities of each Loan Party to the Administrative Agent, the Issuing
Banks and the Lenders under this Agreement and the other Loan Documents to which
such Loan Party is a party or in respect of any obligations or liabilities of
the other Loan Parties, without any limitation as to amount, unless the
instrument or agreement evidencing or creating such other liability specifically
provides to the contrary.

SECTION 10.12 Commodity Exchange Act Keepwell. Each Loan Party that is a
Qualified ECP when its guaranty of or grant of Lien as security for a Hedge
Obligation becomes effective hereby jointly and severally, absolutely,
unconditionally and irrevocably undertakes to provide funds or other support to
each Specified Loan Party with respect to such Hedge Obligation as may be needed
by such Specified Loan Party from time to time to honor all of its obligations
under the Loan Documents in respect of such Hedge Obligation (but, in each case,
only up to the maximum amount of such liability that can be hereby incurred
without rendering such Qualified ECP’s obligations and undertakings under this
Section 10.12 voidable under any applicable fraudulent transfer or conveyance
act). The obligations and undertakings of each Qualified ECP under this Section
shall remain in full force and effect until all Secured Obligations are paid in
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Party intends this Section to constitute, and this Section shall be deemed to
constitute, a guarantee of the obligations of, and a “keepwell, support or other
agreement” for the benefit of, each Loan Party for all purposes of the Commodity
Exchange Act.

ARTICLE XI

THE BORROWER REPRESENTATIVE

SECTION 11.01 Appointment; Nature of Relationship. The Company is hereby
appointed by each of the Borrowers as its contractual representative (herein
referred to as the “Borrower Representative”) hereunder and under each other
Loan Document, and each of the Borrowers irrevocably authorizes the Borrower
Representative to act as the contractual representative of such Borrower with
the rights and duties expressly set forth herein and in the other Loan
Documents. The Borrower Representative agrees to act as such contractual
representative upon the express conditions contained in this Article XI.
Additionally, the Borrowers hereby appoint the Borrower Representative as their
agent to receive all of the proceeds of the Loans in the Funding Account(s), at
which time the Borrower Representative shall promptly disburse such Loans to the
appropriate Borrower. The Administrative Agent and the Lenders, and their
respective officers, directors, agents or employees, shall not be liable to the
Borrower Representative or any Borrower for any action taken or omitted to be
taken by the Borrower Representative or the Borrowers pursuant to this
Section 11.01.

SECTION 11.02 Powers The Borrower Representative shall have and may exercise
such powers under the Loan Documents as are specifically delegated to the
Borrower Representative by the terms of each thereof, together with such powers
as are reasonably incidental thereto. The Borrower Representative shall have no
implied duties to the Borrowers, or any obligation to the Lenders to take any
action thereunder except any action specifically provided by the Loan Documents
to be taken by the Borrower Representative.

SECTION 11.03 Employment of Agents. The Borrower Representative may execute any
of its duties as the Borrower Representative hereunder and under any other Loan
Document by or through authorized officers.

SECTION 11.04 Notices. Each Borrower shall immediately notify the Borrower
Representative of the occurrence of any Default hereunder referring to this
Agreement describing such Default and stating that such notice is a “notice of
default.” In the event that the Borrower Representative receives such a notice,
the Borrower Representative shall give prompt notice thereof to the
Administrative Agent and the Lenders. Any notice provided to the Borrower
Representative hereunder shall constitute notice to each Borrower on the date
received by the Borrower Representative.

SECTION 11.05 Successor Borrower Representative. Upon the prior written consent
of the Administrative Agent, the Borrower Representative may resign at any time,
such resignation to be effective upon the appointment of a successor Borrower
Representative. The Administrative Agent shall give prompt written notice of
such resignation to the Lenders.

SECTION 11.06 Execution of Loan Documents; Borrowing Base Certificate. The
Borrowers hereby empower and authorize the Borrower Representative, on behalf of
the Borrowers, to execute and deliver to the Administrative Agent and the
Lenders the Loan Documents and all related agreements, certificates, documents,
or instruments as shall be necessary or appropriate to effect the purposes of
the Loan Documents, including without limitation, the Borrowing Base
Certificates and the Compliance Certificates. Each Borrower agrees that any
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Borrowers in accordance with the terms of this Agreement or the other Loan
Documents, and the exercise by the Borrower Representative of its powers set
forth therein or herein, together with such other powers that are reasonably
incidental thereto, shall be binding upon all of the Borrowers.

SECTION 11.07 Reporting. Each Borrower hereby agrees that such Borrower shall
furnish promptly after each fiscal month to the Borrower Representative a copy
of its Borrowing Base Certificate and any other certificate or report required
hereunder or requested by the Borrower Representative on which the Borrower
Representative shall rely to prepare the Borrowing Base Certificates and
Compliance Certificates required pursuant to the provisions of this Agreement.

[Remainder of page intentionally left blank; signatures begin on following page]

 

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

 

BORROWERS: INTERLINE BRANDS, INC., a New Jersey corporation By:  

 

  Name:   Title: WILMAR FINANCIAL, INC., a Delaware corporation By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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OTHER LOAN PARTIES/LOAN GUARANTORS: INTERLINE BRANDS, INC., a Delaware
corporation By:  

 

  Name:   Title: GLENWOOD ACQUISITION LLC, a Delaware limited liability company
By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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AGENTS AND LENDERS: BANK OF AMERICA, N.A., individually, as Administrative
Agent, Issuing Bank, Swingline Lender and a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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GOLDMAN SACHS LENDING PARTNERS LLC, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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U.S. BANK NATIONAL ASSOCIATION, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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KEYBANK NATIONAL ASSOCIATION, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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TD BANK, N.A., as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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REGIONS BANK, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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BARCLAYS BANK PLC, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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COMMITMENT SCHEDULE

 

Lender    Commitment  

Bank of America, N.A.

   $ 60,000,000   

Wells Fargo Bank, National Association

   $ 40,000,000   

KeyBank National Association

   $ 40,000,000   

U.S. Bank National Association

   $ 37,500,000   

TD Bank, N.A.

   $ 37,500,000   

Regions Bank

   $ 22,500,000   

Goldman Sachs Lending Partners LLC

   $ 20,000,000   

Barclays Bank PLC

   $ 17,500,000   

Total

   $ 275,000,000.00   

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Annex B

 

Annex B to First Amendment to Credit Agreement

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Execution VersionConformed Through Amendment No. 1

 

 

 

CREDIT AGREEMENT

dated as of

September 7, 2012

among

INTERLINE BRANDS, INC.,

a New Jersey corporation,

WILMAR HOLDINGS, INC.

a Delaware corporation,

WILMAR FINANCIAL, INC.,

a Delaware corporation

as Borrowers

The Other Loan Parties Party Hereto,

The Lenders Party Hereto,

BANK OF AMERICA, N.A.,

as Administrative Agent,

GOLDMAN SACHS LENDING PARTNERS LLC,

as Syndication Agent

and

WELLS FARGO BANK, NATIONAL ASSOCIATION,

KEYBANK NATIONAL ASSOCIATION,

U.S. BANK NATIONAL ASSOCIATION

and

TD BANK, N.A.,

as Co-Documentation Agents

 

 

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

and

GOLDMAN SACHS LENDING PARTNERS LLC,

as Joint Bookrunners and Joint Lead Arrangers

 

 

 

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TABLE OF CONTENTS

 

          Page   ARTICLE I    Definitions    SECTION 1.01   

Defined Terms

     1    SECTION 1.02   

Classification of Loans and Borrowings

     40    SECTION 1.03   

Terms Generally

     40    SECTION 1.04   

Accounting Terms; GAAP

     40    ARTICLE II    The Credits    SECTION 2.01   

Commitments

     41    SECTION 2.02   

Loans and Borrowings

     41    SECTION 2.03   

Requests for Revolving Borrowings

     41    SECTION 2.04   

Protective Advances

     42    SECTION 2.05   

Swingline Loans

     43    SECTION 2.06   

Letters of Credit

     44    SECTION 2.07   

Funding of Borrowings

     47    SECTION 2.08   

Interest Elections

     48    SECTION 2.09   

Termination and Reduction of Commitments; Increase in Commitments

     49    SECTION 2.10   

Repayment of Loans; Evidence of Debt

     51    SECTION 2.11   

Prepayment of Loans

     51    SECTION 2.12   

Fees

     52    SECTION 2.13   

Interest

     53    SECTION 2.14   

Alternate Rate of Interest

     54    SECTION 2.15   

Increased Costs

     54    SECTION 2.16   

Break Funding Payments

     55    SECTION 2.17   

Taxes

     55    SECTION 2.18   

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

     58    SECTION 2.19   

Mitigation Obligations; Replacement of Lenders

     61    SECTION 2.20   

Defaulting Lenders

     61    SECTION 2.21   

Returned Payments

     63    SECTION 2.22   

Limitation on Permitted Discretion

     63    ARTICLE III    Representations and Warranties    SECTION 3.01   

Organization; Powers

     64    SECTION 3.02   

Authorization; Enforceability

     64    SECTION 3.03   

Governmental Approvals; No Conflicts

     64    SECTION 3.04   

Financial Condition; No Material Adverse Effect

     65    SECTION 3.05   

Properties

     65    SECTION 3.06   

Litigation and Environmental Matters

     65    SECTION 3.07   

Compliance with Laws and Agreements

     66    SECTION 3.08   

Investment Company Status

     66   

 

i

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SECTION 3.09  

Taxes

     66    SECTION 3.10  

ERISA

     66    SECTION 3.11  

Disclosure

     66    SECTION 3.12  

Material Agreements

     67    SECTION 3.13  

Solvency

     67    SECTION 3.14  

Insurance

     67    SECTION 3.15  

Capitalization and Subsidiaries

     67    SECTION 3.16  

Security Interest in Collateral

     67    SECTION 3.17  

Employment Matters

     68    SECTION 3.18  

Common Enterprise

     68    SECTION 3.19  

Permitted Indebtedness

     68    SECTION 3.20  

OFAC

     68    SECTION 3.21  

Patriot Act, Etc.

     68    SECTION 3.22  

Margin Regulations

     69    ARTICLE IV    Conditions    SECTION 4.01  

Effective Date

     69    SECTION 4.02  

Each Credit Event

     72    ARTICLE V    Affirmative Covenants    SECTION 5.01  

Financial Statements; Borrowing Base and Other Information

     73    SECTION 5.02  

Notices of Material Events

     75    SECTION 5.03  

Existence; Conduct of Business

     76    SECTION 5.04  

Payment of Obligations

     76    SECTION 5.05  

Maintenance of Properties

     76    SECTION 5.06  

Books and Records; Inspection Rights

     76    SECTION 5.07  

Compliance with Laws

     77    SECTION 5.08  

Use of Proceeds

     77    SECTION 5.09  

Insurance

     77    SECTION 5.10  

Appraisals

     7577    SECTION 5.11  

Field Examinations

     7578    SECTION 5.12  

Depository Banks

     78    SECTION 5.13  

Additional Collateral; Further Assurances

     78    SECTION 5.14  

Post-Closing Actions

     7779    ARTICLE VI    Negative Covenants    SECTION 6.01  

Indebtedness

     7780    SECTION 6.02  

Liens

     8083    SECTION 6.03  

Fundamental Changes

     8185    SECTION 6.04  

Investments, Loans, Advances, Guarantees and Acquisitions

     8286    SECTION 6.05  

Asset Sales

     8488    SECTION 6.06  

Sale and Leaseback Transactions

     8689   

 

ii

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SECTION 6.07  

Swap Agreements

     8690    SECTION 6.08  

Restricted Payments; Certain Payments of Indebtedness

     8690    SECTION 6.09  

Transactions with Affiliates

     8892    SECTION 6.10  

Restrictive Agreements

     8993    SECTION 6.11  

Amendment of Material Documents

     8993    SECTION 6.12  

Fixed Charge Coverage Ratio

     8993    ARTICLE VII    Events of Default    SECTION 7.01  

Events of Default

     9094    SECTION 7.02  

Right to Cure

     9296    ARTICLE VIII    The Administrative Agent    ARTICLE IX   
Miscellaneous    SECTION 9.01  

Notices

     96100    SECTION 9.02  

Waivers; Amendments

     97101    SECTION 9.03  

Expenses; Indemnity; Damage Waiver

     99103    SECTION 9.04  

Successors and Assigns

     101105    SECTION 9.05  

Survival

     104108    SECTION 9.06  

Counterparts; Integration; Effectiveness

     105109    SECTION 9.07  

Severability

     105109    SECTION 9.08  

Right of Setoff

     105109    SECTION 9.09  

Governing Law; Jurisdiction; Consent to Service of Process

     105109    SECTION 9.10  

WAIVER OF JURY TRIAL

     106110    SECTION 9.11  

Headings

     106110    SECTION 9.12  

Confidentiality

     106110    SECTION 9.13  

Several Obligations; Nonreliance; Violation of Law

     107111    SECTION 9.14  

USA PATRIOT Act

     107111    SECTION 9.15  

Disclosure

     107111    SECTION 9.16  

Appointment for Perfection

     107111    SECTION 9.17  

Interest Rate Limitation

     108112    SECTION 9.18  

No Advisory or Fiduciary Duty

     108112    ARTICLE X    Loan Guaranty    SECTION 10.01  

Guaranty

     108112    SECTION 10.02  

Guaranty of Payment

     109113    SECTION 10.03  

No Discharge or Diminishment of Loan Guaranty

     109113    SECTION 10.04  

Defenses Waived

     110113    SECTION 10.05  

Rights of Subrogation

     110114    SECTION 10.06  

Reinstatement; Stay of Acceleration

     110114   

 

iii

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SECTION 10.07  

Information

     110114    SECTION 10.08  

Taxes

     110114    SECTION 10.09  

Maximum Liability

     111114    SECTION 10.10  

Contribution

     111115    SECTION 10.11  

Liability Cumulative

     112115    SECTION 10.12  

Commodity Exchange Act Keepwell

     115    ARTICLE XI    The Borrower Representative    SECTION 11.01  

Appointment; Nature of Relationship

     112116    SECTION 11.02  

Powers

     112116    SECTION 11.03  

Employment of Agents

     112116    SECTION 11.04  

Notices

     112116    SECTION 11.05  

Successor Borrower Representative

     112116    SECTION 11.06  

Execution of Loan Documents; Borrowing Base Certificate

     112116    SECTION 11.07  

Reporting

     113117   

SCHEDULES:

Commitment Schedule

Schedule 1.01 — Specified Properties

Schedule 2.06 — Existing Letters of Credit

Schedule 3.05 — Properties

Schedule 3.06 — Disclosed Matters

Schedule 3.12 — Material Agreements

Schedule 3.14 — Insurance

Schedule 3.15 — Capitalization and Subsidiaries

Schedule 5.14 — Post-Closing Actions

Schedule 6.01 — Existing Indebtedness

Schedule 6.02 — Existing Liens

Schedule 6.04 — Existing Investments

Schedule 6.10 — Existing Restrictions

Schedule 9.04(e) — Permitted Assignees

EXHIBITS:

Exhibit A-1 — Form of Assignment and Acceptance

Exhibit A-2 — Form of Assignment Notice

Exhibit B — Form of Borrowing Base Certificate

Exhibit C — Form of Compliance Certificate

Exhibit D — Form of Joinder Agreement

Exhibit E — Collateral Monitoring Reporting Requirements

Exhibit F — Form of Intercompany Subordinated Note

Exhibit G-1 — Form of U.S. Tax Certificate for Foreign Lenders That Are Not
Partnerships

Exhibit G-2 — Form of U.S. Tax Certificate for Foreign Participants That Are Not
Partnerships

Exhibit G-3 — Form of U.S. Tax Certificate for Foreign Participants That Are
Partnerships

Exhibit G-4 — Form of U.S. Tax Certificate for Foreign Lenders That Are
Partnerships

Exhibit H — Form of Solvency Certificate

Exhibit I — Form of Intercreditor Agreement

 

iv

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CREDIT AGREEMENT dated as of September 7, 2012 (as it may be amended or modified
from time to time, this “Agreement”), among INTERLINE BRANDS, INC., a New Jersey
corporation (the “Company”), WILMAR HOLDINGS, INC., a Delaware corporation
(“Wilmar Holdings”), and WILMAR FINANCIAL, INC., a Delaware corporation (“Wilmar
Financial”), as Borrowers, the other Loan Parties party hereto from time to
time, the Lenders party hereto and BANK OF AMERICA, N.A., as Administrative
Agent.

The parties hereto agree as follows:

ARTICLE I

DEFINITIONS

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

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

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

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

“Acquired EBITDA” means, with respect to any Acquired Entity or Business or any
Converted Restricted Subsidiary (any of the foregoing, a “Pro Forma Entity”) for
any period, the amount for such period of EBITDA of such Pro Forma Entity
(determined using such definitions as if references to Holdings, the Company and
any of their Subsidiaries therein were to such Pro Forma Entity and its
Subsidiaries), all as determined on a consolidated basis for such Pro Forma
Entity in accordance with GAAP.

“Acquired Entity or Business” has the meaning assigned to such term in the term
“EBITDA”.

“Acquisition” means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which any one or more
Loan Parties or Restricted Subsidiaries of Loan Parties (a) acquire all or
substantially all of the assets of any Person or any division or line of
business of any other Person, whether through purchase of assets, merger or
otherwise or (b) directly or indirectly acquire (in one transaction or as the
most recent transaction in a series of related transactions) at least a majority
(in number of votes) of the Equity Interests in a Person which has ordinary
voting power for the election of directors or other similar management personnel
of a Person (other than Equity Interests having such power only by reason of the
happening of a contingency) or a majority of the outstanding Equity Interests in
a Person.

“Acquisition Consideration” means the purchase consideration paid for any
Permitted Acquisition, whether paid in cash, properties, assumption of
Indebtedness or other obligations or otherwise and whether payable at or prior
to the consummation of such Permitted Acquisition or deferred for payment at any
time in the future, whether or not such future payment is subject to the
occurrence of any contingency, and includes any and all payments representing
“earn-outs” and other agreements to make any payment the amount of which, or the
terms of payment of which are, in any respect subject to, or contingent upon,
the revenues, income, cash flow or profits of any Person, business or operating
division.

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“Administrative Agent” means Bank of America, N.A., in its capacity as
administrative agent for the Lenders hereunder.

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

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

“Agent/Arranger Persons” has the meaning assigned to such term in Section 9.03.

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

“Agreement” has the meaning assigned to such term in the preamble of this
Agreement.

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus  1/2 of 1% and (c) LIBOR for a 30 day Interest
Period on such day (or if such day is not a Business Day, the immediately
preceding Business Day) plus 1%. Any change in the Alternate Base Rate due to a
change in the Prime Rate, the Federal Funds Effective Rate or LIBOR shall be
effective from and including the effective date of such change in the Prime
Rate, the Federal Funds Effective Rate or LIBOR, respectively.

“Applicable Commitment Fee Rate” means, for any day, with respect to the
commitment fees payable hereunder, the rate per annum set forth below under the
caption “Commitment Fee Rate”, based upon the Average Utilization during the
preceding calendar quarter; provided that until the end of the first fiscal
quarter after the Effective Date, the “Applicable Commitment Fee Rate” shall be
the applicable rate per annum set forth below in Category 2:

 

Average Utilization

   Commitment Fee
Rate  

Category 1

  

 

0.250

  

 

Average Utilization > 50%

  

Category 2

  

 

0.375

  

 

Average Utilization £ 50%

  

“Applicable Percentage” means, with respect to any Lender, (a) with respect to
Revolving Loans, LC Exposure or Swingline Loans, a percentage equal to a
fraction the numerator of which is such Lender’s Commitment and the denominator
of which is the Commitments of all Revolving Lenders (if the Commitments have
terminated or expired, the Applicable Percentages shall be determined based upon
such Lender’s share of the aggregate Revolving Exposures at that time); provided
that in the case of Section 2.20 when a Defaulting Lender shall exist, any such
Defaulting Lender’s Commitment shall be disregarded in the calculation and
(b) with respect to Protective Advances or with respect to the Aggregate Credit
Exposure, a percentage based upon its share of the Aggregate Credit Exposure and
the unused Commitments; provided that in the case of Section 2.20 when a
Defaulting Lender shall exist, any such Defaulting Lender’s Commitment shall be
disregarded in the calculation.

 

2

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“Applicable Rate” means, for any day, with respect to any ABR Loan or Eurodollar
Revolving Loan, as the case may be, the applicable rate per annum set forth
below under the caption “Revolver ABR Spread” or “Revolver Eurodollar Spread”,
as the case may be, based upon the Borrowers’ average daily Availability for the
most recent fiscal quarter determined as of the most recent determination date,
provided that until the delivery to the Administrative Agent, pursuant to
Section 5.01, of the Borrowers’ financial statements and Compliance Certificate
for the Borrowers’ first fiscal quarter ending after the Effective Date, the
“Applicable Rate” shall be the applicable rate per annum in the Category set
forth below for Availability as determined on the Effective Date after giving
effect to all Borrowings, the issuance (or deemed issuance) of any Letters of
Credit and the payment of all fees and expenses due hereunder on the Effective
Date:

 

Availability

   Revolver
ABR Spread      Revolver
Eurodollar Spread  

Category 1

     0.50         1.50   

 

> $150,000,000

     

Category 2

     0.75         1.75   

 

> $75,000,000 but £ $150,000,000

     

Category 3

     1.00         2.00   

 

£ $75,000,000

     

For purposes of the foregoing, (a) the Applicable Rate shall be determined as of
the end of each fiscal quarter of the Borrowers based upon the Borrowers’
Borrowing Base Certificates delivered pursuant to Section 5.01(e) and (b) each
change in the Applicable Rate shall be effective during the period commencing on
the first day of the calendar month following the receipt by the Administrative
Agent of the financial statements and Compliance Certificate for the fiscal
quarter or, in the case of the last fiscal quarter of each year, the calendar
year then ended pursuant to Section 5.01(a) or (b), as applicable, and ending on
the date immediately preceding the effective date of the next such change;
provided that, the Applicable Rate in Category 2 or Category 3 above determined
as of the end of such fiscal quarter shall decrease by 0.25% if the Fixed Charge
Coverage Ratio for the period of four consecutive fiscal quarters ending on the
last day of such fiscal quarter is greater than 1.50:1.00. Availability shall be
deemed to be in Category 3 at the option of the Administrative Agent or at the
request of the Required Lenders if the Borrowers fail to deliver a Borrowing
Base Certificate required to be delivered by it pursuant to Section 5.01(e),
during the period from the expiration of the time for delivery thereof until
such Borrowing Base Certificate is delivered.

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

“Assignment and Acceptance” means an assignment agreement entered into by an
assigning Lender and an assignee in the form of Exhibit A-1 or any other form
approved by the Administrative Agent and the Borrower Representative (which
approval, in the case of approvals by the Borrower Representative, (x) shall not
be unreasonably withheld or delayed and (y) shall be deemed given if no
objection is made within five Business Days of delivery of such form of
assignment to Borrower Representative).

“Assignment Notice” mean an assignment notice entered into among an assigning
Lender, an assignee, the Administrative Agent, each Issuing Bank, the Swingline
Lender and, if applicable, the Borrower Representative in the form of Exhibit
A-2.

 

3

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“Available Commitment” means, at any time, the Commitments then in effect minus
the Revolving Exposure of all Revolving Lenders at such time.

“Availability” means, at any time, an amount equal to (a) the lesser of (i) the
Commitments and (ii) the Borrowing Base, minus (b) the Aggregate Credit
Exposure.

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

“Average Utilization” means, for any period, the quotient, expressed as a
percentage, of (a) the average daily Revolving Exposure of all Lenders divided
by (b) the average daily Commitments.

“BofA” means Bank of America, N.A., a national banking association, in its
individual capacity, and its successors.

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

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

“Banking Services Reserve” means all Reserves which the Administrative Agent
from time to time establishes in its Permitted Discretion for Banking Services
then provided or outstanding.

“Bankruptcy Code” means Title 11 of the United States Code.

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

“Borrower” or “Borrowers” means, individually or collectively, the Company,
Wilmar Holdings, Wilmar Financial, JanPak, LLC, a West Virginia limited
liability company, JanPak of South Carolina, LLC, a South Carolina limited
liability company, JanPak of Texas, LLC, a Texas limited liability company, IBI
Merchandising Services, Inc., a Delaware corporation, and any other Person who
becomes a party to this Agreement as a Borrower pursuant to a Joinder Agreement.

“Borrower Representative” has the meaning assigned to such term in
Section 11.01.

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

“Borrowing Base” means, at any time, the sum of:

(a) the product of (i) 85% multiplied by (ii) the Borrowers’ Eligible Accounts
at such time, plus

 

4

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(b) the lesser of (i) the product of (x) 70% multiplied by (y) the Borrowers’
Eligible Inventory, valued at the lower of cost (net of rebates and discounts)
or market value, determined in a manner consistent with practices on the
Effective Date, at such time and (ii) the product of 85% multiplied by the Net
Orderly Liquidation Value of the Borrowers’ Eligible Inventory, minus

(c) Reserves.

The Administrative Agent may, in its Permitted Discretion, adjust Reserves used
in computing the Borrowing Base, with any such changes to be effective three
(3) days after delivery of notice thereof to the Borrower Representative and the
Lenders. The Borrowing Base at any time shall be determined by reference to the
most recent Borrowing Base Certificate delivered to the Administrative Agent
pursuant to Section 5.01(e) of this Agreement.

“Borrowing Base Certificate” means a certificate, signed and certified as
accurate and complete by a Financial Officer of the Borrower Representative, in
substantially the form of Exhibit B (or another form as may, from time to time,
be mutually agreed by the Borrower Representative and the Administrative Agent),
setting forth the Borrower Representative’s calculation of the Borrowing Base.

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

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed; provided that, when used in connection with a Eurodollar Loan,
the term “Business Day” shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.

“Buyers Access” means Buyers Access LLC, a Delaware limited liability company.

“Capital Expenditures” means, without duplication, any expenditure or commitment
to expend money for any purchase or other acquisition of any asset which would
be classified as a fixed or capital asset on a consolidated balance sheet of
Holdings and its Restricted Subsidiaries prepared in accordance with GAAP, but
excluding (i) any such expenditure made to restore, replace or rebuild property
to the condition of such property immediately prior to any damage, loss,
destruction or condemnation of such property, to the extent such expenditure is
made with insurance proceeds, condemnation awards or damage recovery proceeds
relating to any such damage, loss, destruction or condemnation, (ii) any such
expenditure (or commitment to expend money) to the extent such expenditure is or
will be made with proceeds of the sale or trade of an asset similar to the asset
being purchased or otherwise acquired, (iii) any such expenditure (or commitment
to expend money) to the extent such expenditure is or will be part of a
Permitted Acquisition and (iv) any such expenditure (or commitment to expend
money) to the extent such expenditure does not exceed an amount equal to the net
proceeds of an issuance of Equity Interests by Holdings (provided that (x) the
Company has notified the Administrative Agent at or prior to the time of such
issuance that the Company and/or one or more of its Restricted Subsidiaries
intended to utilize all or a portion of such proceeds to fund such expenditure
(and describing the contemplated use and estimated amount of such expenditure)
and (y) such expenditure is made (or a commitment to make such expenditure is
entered into) within ninety days of the issuance of such Equity Interests).

 

5

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“Capital Lease Obligations” of any Person means the obligations of such Person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP, and the amount of such obligations
shall be the capitalized amount thereof determined in accordance with GAAP;
provided, that the term “Capital Lease Obligations” shall not include any
obligations that are excluded from the definition of “Indebtedness” pursuant to
the proviso thereto.

“Captive Insurance Subsidiary” means any Subsidiary of the Company that is
subject to regulation as an insurance company (or any Subsidiary thereof).

“Cash Pooling Arrangements” means a deposit account arrangement among a single
depository institution and one or more Foreign Subsidiaries of the Company
involving the pooling of cash deposits and overdrafts in respect of one or more
deposit accounts (each located outside of the United States and any States and
territories thereof) with such institution by such Foreign Subsidiaries for cash
management purposes.

“Change in Control” means (a)(i) at any time prior to a Qualifying IPO, the
acquisition of ownership, directly or indirectly, beneficially or of record, by
any Person or group (within the meaning of the Securities Exchange Act of 1934
and the rules of the SEC thereunder as in effect on the date hereof), other than
one or more Permitted Holders, of Equity Interests representing more than 50% of
the aggregate ordinary voting power represented by the issued and outstanding
Equity Interests of Holdings and (ii) at any time on or after a Qualifying IPO,
the acquisition of ownership, directly or indirectly, beneficially or of record,
by any Person or group (within the meaning of the Securities Exchange Act of
1934 and the rules of the SEC thereunder as in effect on the date hereof) but
excluding any employee benefit plan and/or Person acting as the trustee, agent
or other fiduciary or administrator therefor, other than one or more Permitted
Holders, of Equity Interests representing more than the greater of (A) 35.0% of
the total voting power of all of the outstanding voting stock of Holdings and
(B) the percentage of the total voting power of all of the outstanding voting
stock of Holdings owned, directly or indirectly, by the Permitted Holders;
(b) Holdings shall cease to own, free and clear of all Liens or other
encumbrances (other than Liens permitted under clause (a) or (e) of the
definition of Permitted Encumbrances and under Section 6.02(a) and (l)), 100% of
the outstanding voting Equity Interests of the Company on a fully diluted basis;
(c) occupation of a majority of the seats (other than vacant seats) on the board
of directors of Holdings by Persons who were neither (i) nominated by the board
of directors of Holdings nor (ii) appointed by directors so nominated; (d) the
occurrence of a “Change of Control”, as defined in theany Term Loan Document or
any Holdings Notes DocumentsDocument; or (e) the Company shall cease to own,
directly or indirectly and free and clear of all Liens or other encumbrances
(other than Liens permitted under clause (a) of the definition of Permitted
Encumbrances and under Section 6.02(a) and (l)), 100% of the outstanding voting
Equity Interests of each other Restricted Subsidiary that is designated as a
Borrower, on a fully diluted basis, unless prior to or concurrently with such
cessation, such Restricted Subsidiary shall have ceased to be a Loan Party in
accordance herewith.

“Change in Law” means the occurrence, after the date of this Agreement (or with
respect to any Lender, if later, the date on which such Lender becomes a
Lender), 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; provided however, that notwithstanding anything herein to the
contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, regulations, guidelines or directives thereunder or issued
in connection therewith and (y) all requests, rules, guidelines or directives
promulgated by the Bank for International Settlements, the Basel Committee on
Banking

 

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Supervision (or any successor or similar authority) or the United States or
foreign regulatory authorities, in each case pursuant to Basel III shall in each
case be deemed to be a “Change in Law”, regardless of the date enacted, adopted
or issued.

“Change in Tax Law” means the enactment, promulgation, execution or ratification
of, or any change in or amendment to any law (including the Code), treaty,
regulation or rule (or in the official interpretation of any law, treaty,
regulation or rule by any Governmental Authority (including a court)) relating
to U.S. income taxation.

“Charges” has the meaning assigned to such term in Section 9.17.

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

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

“Co-Documentation Agents” means Wells Fargo Bank, National Association, U.S.
Bank National Association, KeyBank National Association and TD Bank, N.A.

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

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

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

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

“Commercial LC Exposure” means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding commercial Letters of Credit at such time and
(b) the aggregate amount of all LC Disbursements relating to commercial Letters
of Credit that have not yet been reimbursed by or on behalf of the Borrowers at
such time. The Commercial LC Exposure of any Revolving Lender at any time shall
be its Applicable Percentage of the total Commercial LC Exposure at such time.

“Commitment” means, with respect to each Lender, the commitment, if any, of such
Lender to make Revolving Loans and to acquire participations in Protective
Advances, Letters of Credit and Swingline Loans hereunder, expressed as an
amount representing the maximum possible aggregate amount of such Lender’s
Credit Exposure hereunder, as such commitment may be reduced or increased from
time to time pursuant to (a) Section 2.09 and (b) assignments by or to such
Lender pursuant to Section 9.04. The initial amount of each Lender’s Commitment
is set forth on the Commitment Schedule, or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Commitment, as applicable.
“Commitments” means the aggregate of each Lender’s Commitment hereunder. The
initial amount of the Commitments is $275,000,000.

“Commitment Letter” means the Project Isabelle Commitment Letter dated as of
May 29, 2012 from the Lead Arrangers and BofA to MergerSub, together with all
exhibits thereto.

 

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

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et
seq.).

“Company” has the meaning assigned to such term in the preamble of this
Agreement.

“Company Disclosure Letter” means the disclosure letter delivered to Newco by
Holdings concurrently with the execution and delivery of the Merger Agreement
(as in effect on May 29, 2012).

“Company Material Adverse Effect” has the meaning assigned to such term in the
Commitment Letter.

“Company Notes” means the notes due 2018 issued by the Company pursuant to the
Company Notes Indenture and the Indebtedness represented thereby.

“Company Notes Documents” means the Company Notes Indenture and all other
instruments, agreements and other documents evidencing or governing the Company
Notes or providing for any Guarantee, obligation, security or other right in
respect thereof.

“Company Notes Indenture” means the Indenture, dated as of November 16, 2010,
among Holdings, the Company, the Subsidiaries listed therein and Wells Fargo
Bank, National Association, as trustee, in respect of the Company Notes, as
amended by that certain First Supplemental Indenture dated June 19, 2012
and2012, by that certain Second Supplemental Indenture dated June 27, 2012 (the
“Second Supplemental Indenture”)., by that certain Third Supplemental Indenture
dated December 11, 2012, by that certain Fourth Supplemental Indenture dated
April 4, 2013, and by that certain Fifth Supplemental Indenture dated March 12,
2014.

“Company SEC Documents” has the meaning assigned to such term in the Merger
Agreement.

“Compliance Certificate” has the meaning assigned to such term in
Section 5.01(c).

“Connection Taxes” means, with respect to any Recipient, Taxes imposed as a
result of any present or former connection between such Recipient and the
jurisdiction imposing such Taxes (other than connections arising from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Loan Document, or sold or assigned any interest in any Loan or Loan Document).

“Consolidated Secured Debt” means, as of any date of determination, (a) the
aggregate principal amount of Indebtedness of Holdings and the Restricted
Subsidiaries outstanding on such date, determined on a consolidated basis in
accordance with GAAP (but excluding the effects of any increase to or
discounting of Indebtedness resulting from the application of purchase
accounting in connection with any Permitted Acquisition), consisting of
Indebtedness for borrowed money, Capital Lease Obligations and debt obligations
evidenced by promissory notes or similar instruments, in each case secured by
Liens, minus (b) the aggregate amount of cash and Permitted Investments held in
accounts on the consolidated balance sheet of Holdings and the Restricted
Subsidiaries as at such date to the extent the use thereof for application to
payment of Indebtedness is not prohibited by law or any contract to which any
such Person is a party.

“Consolidated Total Assets” means, as of any date of determination, the amount
that would, in conformity with GAAP, be set forth opposite the caption “total
assets” (or any like caption) on a

 

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consolidated balance sheet of Holdings and the Restricted Subsidiaries at such
datethe Company and its Restricted Subsidiaries as of the last day of the most
recently ended fiscal period for which financial statements have been delivered
pursuant Section 5.01(a) or Section 5.01(b), as applicable.

“Consolidated Total Debt” means, as of any date of determination, (a) the
aggregate principal amount of Indebtedness of Holdings and the Restricted
Subsidiaries outstanding on such date, determined on a consolidated basis in
accordance with GAAP (but excluding the effects of any increase to or
discounting of Indebtedness resulting from the application of purchase
accounting in connection with any Permitted Acquisition or the Transactions),
consisting of Indebtedness for borrowed money, Capital Lease Obligations and
debt obligations evidenced by promissory notes or similar instruments, minus
(b) the aggregate amount of cash and Permitted Investments held in accounts on
the consolidated balance sheet of Holdings and the Restricted Subsidiaries as at
such date to the extent the use thereof for application to payment of
Indebtedness is not prohibited by law or any contract to which any such Person
is a party.

“Consolidated Total Debt to EBITDA Ratio” means as of any date of determination,
the ratio of (a) Consolidated Total Debt as of such date to (b) Indenture EBITDA
for the Reference Period.

“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.

“Converted Restricted Subsidiary” has the meaning assigned to such term in the
definition of “EBITDA”.

“Converted Unrestricted Subsidiary” has the meaning assigned to such term in the
definition of “EBITDA”.

“Covenant Trigger Period” means (a) each period commencing on any day that an
Event of Default occurs, and continuing until such Event of Default has been
cured or waived and (b) each period commencing on any day that Availability is
less than the greater of (i) $25,000,000 and (ii) 10% of the Commitments, and
continuing until, during the preceding 30 consecutive days, Availability has at
all times exceeded the greater of (A) $25,000,000 and (B) 10% of the
Commitments.

“Credit Exposure” means, as to any Lender at any time, the sum of (a) such
Lender’s Revolving Exposure at such time, and (b) an amount equal to its
Applicable Percentage, if any, of the aggregate principal amount of Protective
Advances outstanding at such time.

“Cure Period” has the meaning assigned to such term in Section 7.02(a).

“Cure Right” has the meaning assigned to such term in Section 7.02(a).

“Debt Reserve” means the aggregate amount of reserves established by the
Administrative Agent with respect to Indebtedness of Holdings and its Restricted
Subsidiaries incurred under Sections 6.01(c) and (t) that matures or has a
scheduled due date before the Maturity Date, such reserves to be in an amount
equal to the aggregate outstanding principal amount of all such Indebtedness
that is scheduled to be paid within 60 days of such maturity or scheduled due
date, as the case may be, to the extent (and only with respect to the portion)
exceeding $50,000,000 and excluding payments relating to (i) a change of
control, (ii) an “applicable high yield discount obligation” catch-up payment,
(iii) amortization of Indebtedness equal to or less than 1.0% per year of the
original principal amount of such Indebtedness, and (iv) redemption and
defeasance provisions customary for the relevant type of Indebtedness.

 

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

“Defaulting Lender” means any Lender, as determined by the Administrative Agent,
that has (a) failed to fund any portion of its Loans or participations in
Letters of Credit or Swingline Loans within three Business Days of the date
required to be funded by it hereunder, unless the conditions to such Loans or
participations in Letters of Credit or Swingline Loans are the subject of a good
faith dispute, (b) notified any Borrower, the Administrative Agent, any Issuing
Bank, the Swingline Lender or any Lender in writing that it does not intend to
comply with any of its funding obligations under this Agreement or has made a
public statement to the effect that it does not intend to comply with its
funding obligations under this Agreement or under other agreements generally in
which it commits to extend credit, (c) failed, within three Business Days after
request by the Administrative Agent, to confirm that it will comply with the
terms of this Agreement relating to its obligations to fund prospective Loans
and participations in then outstanding Letters of Credit and Swingline Loans,
(d) otherwise failed to pay over to the Administrative Agent or any other Lender
any other amount required to be paid by it hereunder within three Business Days
of the date when due, unless the subject of a good faith dispute, or
(e) (i) become or is insolvent or, at the discretion of the Administrative
Agent, has a parent company that has become or is insolvent or (ii) become the
subject of a bankruptcy or insolvency proceeding, or has had a receiver,
conservator, trustee or custodian appointed for it, or has had a similar Person
charged with the reorganization or liquidation of its business or assets,
including the Federal Deposit Insurance Corporation, or has taken any action in
furtherance of, or indicating its consent to, approval of or acquiescence in any
such proceeding or appointment or, at the discretion of the Administrative
Agent, has a parent company that has become the subject of a bankruptcy or
insolvency proceeding, or has had a receiver, conservator, trustee or custodian
appointed for it or has had a similar Person charged with the reorganization or
liquidation of its business or assets, including the Federal Deposit Insurance
Corporation, or has taken any action in furtherance of, or indicating its
consent to, approval of or acquiescence in any such proceeding or appointment;
provided that a Lender shall not be a Defaulting Lender solely by virtue of the
ownership or acquisition of any equity interest in that Lender or any direct or
indirect parent company by a Governmental Authority.

“Designated Non-Cash Consideration” means the fair market value of non-cash
consideration received by any Borrower or a Restricted Subsidiary in connection
with a disposition to which the proviso to Section 6.05 applies that is
designated as Designated Non-Cash Consideration pursuant to a certificate of a
Borrower Representative, setting forth the basis of such valuation (which amount
will be reduced by the fair market value of the portion of the non-cash
consideration converted to cash within 180 days following the consummation of
the applicable disposition).

“Dilution Factors” shall mean, without duplication, with respect to any period,
the aggregate amount of all deductions, credit memos, returns, adjustments,
allowances, bad debt write-offs and other non-cash credits which are recorded to
reduce accounts receivable of the Borrowers in a manner consistent with current
and historical accounting practices of the Borrowers.

“Dilution Ratio” shall mean, at any date, the amount (expressed as a percentage)
equal to (a) the aggregate amount of the applicable Dilution Factors for the
twelve (12) most recently ended fiscal months divided by (b) total gross sales
of the Borrowers for the twelve (12) most recently ended fiscal months.

“Dilution Reserve” shall mean, at any date, the greater of (a) zero and (b) the
product of the applicable Dilution Ratio minus 5% multiplied by the Eligible
Accounts on such date.

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

 

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“Disposed EBITDA” means, with respect to any Sold Entity or Business or any
Converted Unrestricted Subsidiary for any period, the amount for such period of
EBITDA of such Sold Entity or Business or Converted Unrestricted Subsidiary
(determined as if references to Holdings, the Company and the Restricted
Subsidiaries in the definition of EBITDA were references to such Sold Entity or
Business or Converted Unrestricted Subsidiary and its Subsidiaries), all as
determined on a consolidated basis for such Sold Entity or Business or Converted
Unrestricted Subsidiary.

“Disqualified Stock” means, with respect to any Person, any Equity Interest
which by its terms (or by the terms of any security into which it is convertible
or for which it is exchangeable at the option of the holder) or upon the
happening of any event: (a) matures or is mandatorily redeemable (other than
redeemable only for Equity Interests of such Person which is not itself
Disqualified Stock) pursuant to a sinking fund obligation or otherwise, (b) is
convertible or exchangeable at the option of the holder for Indebtedness or
Disqualified Stock or (c) is mandatorily redeemable or must be purchased upon
the occurrence of certain events or otherwise, in whole or in part, in each
case, on or prior to ninety-one (91) days after the Maturity Date, except, in
the case of clauses (a) and (b), if as a result of a change of control or asset
sale, so long as any rights of the holders thereof upon the occurrence of such a
change of control or asset sale event are subject to the prior payment in full
of all Obligations.

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

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

“Domestic Subsidiary” means a Subsidiary that is incorporated or formed under
the laws of the United States of America, any state thereof or the District of
Columbia.

“Dominion Trigger Period” means (a) each period commencing on any day that an
Event of Default under Section 7.01(a), Section 7.01(b), Section 7.01(h) or
Section 7.01(i) occurs or, at the election of the Administrative Agent or the
Required Lenders, any other Event of Default occurs, and continuing until such
Event of Default has been cured or waived and (b) each period commencing on any
day that Availability is less than the greater of (i) $25,000,000 and (ii) 10%
of the Commitments, and continuing until, during the preceding 30 consecutive
days, Availability has at all times exceeded the greater of (A) $25,000,000 and
(B) 10% of the Commitments.

“EBITDA” means, for any period, Net Income for such period plus (a) without
duplication and to the extent deducted in determining Net Income for such
period, the sum of (i) Interest Expense for such period, (ii) provision for
income taxes for such period, (iii) all amounts attributable to depreciation and
amortization expense for such period, (iv) any extraordinary charges for such
period, (v) any impairment charge or asset write-off related to intangible
assets (including goodwill), long-lived assets, and investments in debt and
equity securities pursuant to GAAP for such period, (vi) all losses from
(A) asset sales (other than asset sales in the ordinary course of business)
during such period and (B) investments recorded using the equity method during
such period, (vii) stock-based awards compensation expense for such period,
(viii) any other non-cash charges during such period (but excluding any non-cash
charge in respect of an item that was included in Net Income (other than accrual
of revenue in the ordinary course of business) in a prior period), (ix) the
amount, if any, of management, monitoring and consulting fees and expenses paid
to the Sponsors for such period, not to exceed $5,000,000 in any four quarter
period, (x) the amount, if any, of transaction fees and related expenses paid to
the Sponsors in connection with acquisitions, dispositions, recapitalizations,
refinancings and extraordinary transactions for such period, not to exceed (net
of reimbursable expenses) 1% of the transaction value for any such transaction,
(xi)(A) restructuring and other non-recurring expenses incurred during such
period, including severance costs, costs associated with office or plant
openings or closings and consolidation or relocation fees for such period and
(B) any up-front fees, transaction costs, commissions, expenses, premiums or
charges related to

 

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the issuance of Equity Interests, any investment permitted hereunder (other than
a Specified Investment), any permitted asset sale, or any recapitalization,
incurrence, repayment, amendment or modification of Indebtedness permitted
hereunder (in each case whether or not consummated but excluding any of the
foregoing paid or payable to the Sponsors under clause (ix) or (x)) during such
period; provided that in no event shall the sum of the amounts under (A) and
(B) of this clause (xi) and the adjustments made in clause (C)(2) below exceed
10% of EBITDA for such period (without giving effect to the adjustments provided
in this clause (xi) and in clause (C)(2)), (xii) costs and expenses paid by the
Borrowers in connection with the Transactions and (xiii) any up-front fees,
transaction costs, commissions, expenses or charges related to any Permitted
Acquisition or other Specified Investment (in each case whether or not
consummated but excluding any of the foregoing paid or payable to the Sponsors
under clause (ix) or (x)) during such period, minus (b) without duplication and
to the extent included in Net Income, (i) any cash payments made during such
period in respect of non-cash charges described in clause (a)(viii) taken in a
prior period, (ii) any extraordinary gains for such period, (iii) any non-cash
items of income for such period (excluding any non-cash gain to the extent it
represents the reversal of an accrual or reserve for a potential cash item that
reduced Net Income in any prior period), (iv) all gains from (A) asset sales
(other than asset sales in the ordinary course of business) during such period
and (B) investments recorded using the equity method during such period, all
calculated for Holdings and its Restricted Subsidiaries on a consolidated basis
in accordance with GAAP; provided that, to the extent included in Net Income,

(A) there shall be excluded in determining EBITDA unrealized currency
translation gains and losses related to currency remeasurements of Indebtedness
or intercompany balances (including the net loss or gain resulting from Swap
Agreements for currency exchange risk),

(B) there shall be excluded in determining EBITDA for any period any adjustments
for unrealized gain or loss resulting from the application of Statement of
Financial Accounting Standards No. 133,

(C) there shall be included in determining EBITDA for any period, without
duplication, (1) the Acquired EBITDA of any Person, property, business or asset
acquired by any of Holdings, the Company or any Restricted Subsidiary since the
beginning of such period to the extent not subsequently sold, transferred,
abandoned or otherwise disposed by Holdings, the Company or such Restricted
Subsidiary (each such Person, property, business or asset acquired and not
subsequently so disposed of, an “Acquired Entity or Business”) and the Acquired
EBITDA of any Unrestricted Subsidiary that is converted into a Restricted
Subsidiary since the beginning of such period (each, a “Converted Restricted
Subsidiary”), based on the actual Acquired EBITDA of such Acquired Entity or
Business or Converted Restricted Subsidiary for such period (including the
portion thereof occurring prior to such acquisition or conversion), and (2) an
adjustment in respect of each Acquired Entity or Business equal to the amount of
the Pro Forma Adjustment with respect to such Acquired Entity or Business
acquired since the beginning of such period (including the portion thereof
occurring prior to such acquisition) as specified in a Pro Forma Adjustment
Certificate and delivered to the Lenders and the Administrative Agent; provided
that in no event shall the sum of the adjustments under this clause (C)(2) and
the amounts under (A) and (B) of clause (xi) above exceed 10% of EBITDA for such
period (without giving effect to the adjustments provided in clause (xi) and
this clause (C)(2)), and

(D) there shall be excluded in determining EBITDA for any period the Disposed
EBITDA of any Person, property, business or asset (other than an Unrestricted
Subsidiary) sold, transferred, abandoned or otherwise disposed of, closed or
classified as discontinued operations by any of Holdings, the Company or any
Restricted Subsidiary since the beginning of such period (each such Person,
property, business or asset so sold or disposed of, a “Sold Entity or
Business”), and the Disposed EBITDA of any Restricted Subsidiary that is
converted into an Unrestricted Subsidiary

 

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during such period (each, a “Converted Unrestricted Subsidiary”) based on the
actual Disposed EBITDA of such Sold Entity or Business or Converted Unrestricted
Subsidiary for such period (including the portion thereof occurring prior to
such sale, transfer or disposition or conversion).

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

“Eligible Accounts” means each Account of a Borrower that, at the time of
creation and at all times thereafter, is not ineligible for inclusion in the
calculation of the Borrowing Base pursuant to any of clauses (a) through
(x) below. Eligible Accounts shall not include any Account:

(a) which is not subject to a first priority perfected security interest in
favor of the Administrative Agent;

(b) which is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent, (ii) a Permitted Encumbrance described in clause (a) of
the definition thereof, provided that, eligibility of Accounts shall be reduced
by the amount of such Permitted Encumbrance and (iii) any Lien permitted under
Section 6.02(l);

(c) with respect to which (i) the scheduled due date is more than 120 days after
the original invoice date, (ii) is unpaid more than 90 days after the date of
the original invoice therefor or more than 60 days after the original due date,
or (iii) has been written off the books of the Borrowers or otherwise designated
as uncollectible (in determining the aggregate amount from the same Account
Debtor that is unpaid hereunder there shall be excluded the amount of any net
credit balances relating to Accounts due from an Account Debtor which are unpaid
more than 90 days from the date of invoice or more than 60 days from the due
date);

(d) which is owing by an Account Debtor for which more than 50% of the Accounts
owing from such Account Debtor and its Affiliates are ineligible pursuant to
clause (c) above;

(e) which is owing by an Account Debtor to the extent the aggregate amount of
Accounts owing from such Account Debtor and its Affiliates to the Borrowers
exceeds 15% (or such higher percentage as the Administrative Agent may establish
for such Account Debtor from time to time but not to exceed 20%) of the
aggregate amount of Eligible Accounts, in each case, only to the extent of such
excess;

(f) with respect to which any covenant, representation, or warranty relating to
such Account contained in this Agreement or in the Security Agreement has been
breached or is not true;

(g) which (i) does not arise from the sale of goods or performance of services
in the ordinary course of business, (ii) is not evidenced by (x) an invoice or
(y) other documentation reasonably satisfactory to the Administrative Agent
which in either case has been sent to the Account Debtor, (iii) represents a
progress billing, (iv) is contingent upon the Borrowers’ completion of any
further performance, (v) represents a sale on a bill-and-hold, guaranteed sale,
sale-and-return, sale on approval, consignment, cash-on-delivery or any other
repurchase or return basis (except with respect to up to $1,000,000 of such
Accounts in the aggregate) or (vi) relates to payments of interest;

(h) for which the goods giving rise to such Account have not been shipped to the
Account Debtor or for which the services giving rise to such Account have not
been performed by such Borrower or if such Account was invoiced more than once;

 

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(i) with respect to which any check or other instrument of payment has been
returned uncollected for any reason;

(j) which is owed by an Account Debtor which has (i) applied for, suffered, or
consented to the appointment of any receiver, custodian, trustee, or liquidator
of its assets, (ii) has had possession of all or a material part of its property
taken by any receiver, custodian, trustee or liquidator, unless the payment of
Accounts owed by such Account Debtor is secured by assets of, or guaranteed by,
in either case in a manner satisfactory to the Administrative Agent, a Person
that is acceptable to the Administrative Agent, (iii) filed, or had filed
against it, any request or petition for liquidation, reorganization,
arrangement, adjustment of debts, adjudication as bankrupt, winding-up, or
voluntary or involuntary case under any state or federal bankruptcy laws (other
than post-petition accounts payable of an Account Debtor that is a
debtor-in-possession under the Bankruptcy Code and reasonably acceptable to the
Administrative Agent), (iv) has admitted in writing its inability, or is
generally unable to, pay its debts as they become due, (v) become insolvent, or
(vi) ceased operation of its business;

(k) which is owed by any Account Debtor which has sold all or a substantially
all of its assets;

(l) which is owed by an Account Debtor which (i) does not maintain its chief
executive office in the U.S. (including any state, commonwealth or territory
thereof that has adopted Revised Article 9 of the Uniform Commercial Code) or
Canada or (ii) is not organized under applicable law of the U.S., any state of
the U.S., any commonwealth or territory of the U.S. (in each case that has
adopted Revised Article 9 of the Uniform Commercial Code), Canada, or any
province of Canada unless, in either case, such Account is backed by a letter of
credit acceptable to the Administrative Agent in its Permitted Discretion so
long as (A) the Administrative Agent has “control” (as defined in the UCC) over
such letter of credit (and if such letter of credit is in tangible form, such
letter of credit is in the possession of the Administrative Agent) and (B) such
letter of credit is directly drawable by the Administrative Agent);

(m) which is owed in any currency other than dollars;

(n) which is owed by (i) the government (or any department, agency, public
corporation, or instrumentality thereof) of any country other than the U.S.
unless such Account is backed by a letter of credit acceptable to the
Administrative Agent in its Permitted Discretion so long as (A) the
Administrative Agent has “control” (as defined in the UCC) over such letter of
credit (and if such letter of credit is in tangible form, such letter of credit
is in the possession of the Administrative Agent) and (B) such letter of credit
is directly drawable by the Administrative Agent), or (ii) the government of the
U.S., or any department, agency, public corporation, or instrumentality thereof,
unless the Federal Assignment of Claims Act of 1940, as amended (31 U.S.C. §
3727 et seq. and 41 U.S.C. § 15 et seq.), and any other steps necessary to
perfect the Lien of the Administrative Agent in such Account have been complied
with to the Administrative Agent’s satisfaction;

(o) which is owed by any Affiliate, employee, officer, director, agent or
stockholder of any Loan Party; provided that portfolio companies of the Sponsors
that do business with a Borrower in the ordinary course of business will not be
treated as Affiliates for purposes of this clause (o);

(p) which is owed by an Account Debtor or any Affiliate of such Account Debtor
to which any Loan Party is indebted, but only to the extent of such indebtedness
or is subject to any security, deposit, progress payment, retainage or other
similar advance made by or for the benefit of an Account Debtor, in each case to
the extent thereof;

(q) which is subject to any counterclaim, deduction, defense, setoff or dispute
but only to the extent of any such counterclaim, deduction, defense, setoff or
dispute unless (i) the Administrative Agent,

 

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in its Permitted Discretion, has established appropriate Reserves and determines
to include such Account as an Eligible Account or (ii) such Account Debtor has
entered into an agreement reasonably acceptable to the Administrative Agent to
waive such rights;

(r) which is evidenced by any promissory note, chattel paper, or instrument;

(s) which is owed by an Account Debtor located in any jurisdiction which
requires filing of a “Notice of Business Activities Report” or other similar
report in order to permit such Borrower to seek judicial enforcement in such
jurisdiction of payment of such Account, unless such Borrower has filed such
report or qualified to do business in such jurisdiction;

(t) with respect to which such Borrower has made any agreement with the Account
Debtor for any reduction thereof, other than discounts and adjustments given in
the ordinary course of business, or any Account which was partially paid and
such Borrower created a new receivable for the unpaid portion of such Account;

(u) which does not comply in all material respects with the requirements of all
applicable laws and regulations, whether Federal, state or local, including
without limitation the Federal Consumer Credit Protection Act, the Federal Truth
in Lending Act and Regulation Z of the Board;

(v) which is for goods that have been sold under a purchase order or pursuant to
the terms of a contract or other agreement or understanding (written or oral)
that indicates or purports that any Person other than such Borrower has or has
had an ownership interest in such goods, or which indicates any party other than
such Borrower as payee or remittance party;

(w) which was created on cash on delivery terms; or

(x) which the Administrative Agent determines may not be paid by reason of the
Account Debtor’s inability to pay or which the Administrative Agent otherwise
determines is unacceptable for any reason whatsoever in the exercise of its
Permitted Discretion.

In the event that an Account which was previously an Eligible Account ceases to
be an Eligible Account hereunder (other than by virtue of clause (x) above),
such Borrower or the Borrower Representative shall notify the Administrative
Agent thereof on and at the time of submission to the Administrative Agent of
the next Borrowing Base Certificate. In determining the amount of an Eligible
Account, the face amount of an Account may, in the Administrative Agent’s
Permitted Discretion, 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 such Borrower may be obligated to rebate to an Account Debtor 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 such Borrower to reduce the amount of such Account.

“Eligible Inventory” means all Inventory of a Borrower that, at the time of
purchase and at all times thereafter was not ineligible for inclusion in the
calculation of the Borrowing Base pursuant to any of clauses (a) through
(p) below. Eligible Inventory shall not include any Inventory:

(a) which is not subject to a first priority perfected Lien in favor of the
Administrative Agent;

(b) which is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent, (ii) a Permitted Encumbrance described in clause (a) or
(b) of the definition thereof, provided that, (A) with

 

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respect to any such Permitted Encumbrance described in clause (a) of the
definition thereof, eligibility of Inventory shall be reduced by the amount of
such Permitted Encumbrance and (B) with respect to any such Permitted
Encumbrance described in clause (b) of the definition thereof, the requirements
of clause (h) or (i) below are satisfied and (iii) any Lien permitted under
Section 6.02(l);

(c) which is, in the Administrative Agent’s Permitted Discretion, slow moving or
obsolete (unless taken into account in the most recent Inventory Appraisal and
the value of Eligible Inventory in the Borrowing Base is being determined by
reference to the Net Orderly Liquidation Value thereof), unmerchantable,
defective, used, unfit for sale, not salable at prices approximating at least
the cost of such Inventory in the ordinary course of business or unacceptable
due to age, type, category and/or quantity;

(d) with respect to which any covenant, representation, or warranty contained in
this Agreement or the Security Agreement has been breached or is not true in any
material respect and which does not conform in any material respect to any
applicable standards imposed by any Governmental Authority;

(e) in which any Person other than such Borrower shall (i) have any direct or
indirect ownership, interest or title to such Inventory or (ii) be indicated on
any purchase order or invoice with respect to such Inventory as having or
purporting to have an interest therein;

(f) which is not finished goods or which constitutes work-in-process, raw
materials, spare or replacement parts, subassemblies, packaging and shipping
material, manufacturing supplies, samples, prototypes, displays or display
items, bill-and-hold goods, goods that are returned or marked for return,
repossessed goods, defective or damaged goods, goods held on consignment, or
goods which are not of a type held for sale in the ordinary course of business;

(g) which is not located in the U.S. (including any state, commonwealth or
territory thereof that has adopted Revised Article 9 of the Uniform Commercial
Code) or is in transit with a common carrier from vendors and suppliers;

(h) which is located in any location leased by such Borrower unless (i) the
lessor has delivered to the Administrative Agent a Collateral Access Agreement
or (ii) a Rent Reserve has been established by the Administrative Agent;

(i) which is (i) located in any third party warehouse or is in the possession of
a bailee (other than a third party processor), unless (A) such warehouseman or
bailee has delivered to the Administrative Agent a Collateral Access Agreement
and such other documentation as the Administrative Agent may require or (B) an
appropriate Reserve has been established by the Administrative Agent in its
Permitted Discretion, and (ii) not evidenced by a Document;

(j) which is being processed offsite at a third party location or outside
processor, or is in-transit to or from said third party location or outside
processor;

(k) which is the subject of a consignment by such Borrower as consignor, unless
(i) a protective UCC-1 financing statement has been properly filed against the
consignee (as assigned to the Administrative Agent), and (ii) there is a written
agreement acknowledging that such Inventory is held on consignment, that such
Borrower retains title to such Inventory, that no Lien arising by, through or
under such consignee has attached or will attach to such Inventory and requiring
consignee to segregate the consigned Inventory from the consignee’s other
personal or movable property and having other terms consistent with such
Borrower’s past practices for consigned Inventory; provided that, Inventory at a
vendor managed location under the control of a Borrower and subject to a written
agreement in which such vendor acknowledges such Borrower’s title to such
Inventory shall not be considered the subject of a consignment;

 

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(l) which is perishable;

(m) which contains or bears any intellectual property rights licensed to the
Borrowers unless the Administrative Agent is satisfied in its Permitted
Discretion that it may sell or otherwise dispose of such Inventory without
(i) infringing the rights of such licensor, (ii) violating any contract with
such licensor, or (iii) incurring any liability with respect to payment of
royalties other than royalties incurred pursuant to sale of such Inventory under
the current licensing agreement;

(n) which is not reflected in a current perpetual inventory report of the
Borrowers;

(o) for which reclamation rights have been asserted by the seller; or

(p) which the Administrative Agent otherwise determines is unacceptable for any
reason whatsoever in the exercise of its Permitted Discretion.

In the event that Inventory which was previously Eligible Inventory ceases to be
Eligible Inventory hereunder (other than pursuant to clause (p) above), such
Borrower or the Borrower Representative shall notify the Administrative Agent
thereof on and at the time of submission to the Administrative Agent of the next
Borrowing Base Certificate.

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

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of any Borrower or any Restricted Subsidiary directly
or indirectly resulting from or based upon (a) violation of any Environmental
Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

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

“Equity Contribution” means the cash equity contributions (including any
roll-over equity contributions from minority investors) in the form of common
equity (unless otherwise agreed in the discretion of the Lead Arrangers) made
directly or indirectly by the Permitted Holders to Newco in an aggregate amount
equal to at least 30% of the pro forma capitalization of Holdings after the
consummation of the Merger.

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

 

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

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

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

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

“Event of Default” has the meaning assigned to such term in Section 7.01.

“Excluded Swap Obligation” means, with respect to any Loan Guarantor, any Hedge
Obligation if, and to the extent that, all or a portion of the Loan Guaranty of
such Loan Guarantor of, or the grant by such Loan Guarantor of a Lien to secure,
such Hedge Obligation (or any Loan Guaranty thereof) is or becomes illegal under
the Commodity Exchange Act or any rule, regulation or order of the Commodity
Futures Trading Commission (or the application or official interpretation of any
thereof) by virtue of such Loan Guarantor’s failure for any reason to constitute
an “eligible contract participant” (as defined in the Commodity Exchange Act and
the regulations thereunder) at the time the Loan Guaranty of such Loan Guarantor
or the grant of such security interest becomes effective with respect to such
Hedge Obligation (which for the avoidance of doubt shall be determined after
giving effect to any “keepwell, support or other agreement” (as such terms are
used under the Commodity Exchange Act) provided for the benefit of such Loan
Guarantor). If a Hedge Obligation arises under a master agreement governing more
than one swap, such exclusion shall apply only to the portion of such Hedge
Obligation that is attributable to swaps for which such Loan Guaranty or
security interest is or becomes illegal.

“Excluded Subsidiary” means (a) any Subsidiary that is not a wholly-owned
Subsidiary, (b) any Subsidiary that is prohibited by any Requirement of Law from
guaranteeing the Secured Obligations, (c) (i) any direct or indirect Domestic
Subsidiary of a Foreign Subsidiary (that is a “controlled foreign corporation”
within the meaning of Section 957 of the Code) and (ii) any Domestic Subsidiary,
substantially all of the direct or indirect assets of which are Equity Interests
of one or more “controlled foreign corporations” within the meaning of
Section 957 of the Code, (d) any Restricted Subsidiary acquired pursuant to a
Permitted Acquisition financed with or subject to secured Indebtedness incurred
pursuant to Section 6.01(l) or Section 6.01(t) and each Restricted Subsidiary
thereof that guarantees such Indebtedness to the extent and so long as the
financing documentation relating thereto prohibits such

 

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Restricted Subsidiary from guaranteeing, or granting a Lien on any of its assets
to secure, the Secured Obligations; provided that after such time that such
prohibitions on guarantees or granting of Liens lapses or terminates, such
Restricted Subsidiary shall no longer be an Excluded Subsidiary, (e) any other
Subsidiary with respect to which, in the reasonable judgment of the
Administrative Agent (confirmed in writing by notice to the Borrower
Representative), the cost or other consequences (including any adverse tax
consequences) of providing a Guarantee shall be excessive in view of the
benefits to be obtained by the Lenders therefrom, (f) any not-for-profit
Subsidiary, (g) any Captive Insurance Subsidiaries, (h) each Unrestricted
Subsidiary and (gi) any RestrictedImmaterial Subsidiary that the Company elects
by notice to the Administrative Agent to treat as an Excluded Subsidiary
pursuant to this clause (gi),; provided that (i) any such RestrictedImmaterial
Subsidiary shall cease to be so treated as an Excluded Subsidiary upon written
notice from the Borrower Representative to the Administrative Agent, (ii) at any
time, the total assets of all Restricted Subsidiaries that are Excluded
Subsidiaries solely as a result of this clause (g), as reflected on their most
recent balance sheets prepared in accordance with GAAP, do not in the aggregate
at any time exceed $5,000,000, and (iii) the total revenues of all Restricted
Subsidiaries that are Excluded Subsidiaries solely as a result of this clause
(g) for the twelve-month period ending on the last day of the most recent period
for which financial statements have been delivered pursuant to Section 5.01(a)
or (b) do not in the aggregate exceed $5,000,000; provided, further, that,
notwithstanding anything to the contrary set forth in this definition, no
Subsidiary that guarantees any of the CompanyTerm Loans or the Holdings Notes
shall be an Excluded Subsidiary.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient, or required to be withheld or deducted from a payment to a
Recipient, with respect to the Administrative Agent, any Lender, any Issuing
Bank or any other recipient of any payment to be made by or on account of any
obligation of any Borrower hereunder, (a) Taxes imposed on or measured by net
income (however denominated), franchise Taxes and branch profits Taxes, in each
case, (i) imposed as a result of such Recipient being organized under the laws
of, or having its principal office or, in the case of any Lender, its applicable
lending office located in, the jurisdiction imposing such Tax (or any political
subdivision thereof) or (ii) that are Connection Taxes, (b) in the case of a
Foreign Lender, any U.S. federal withholding Tax that is imposed on amounts
payable to such Foreign Lender pursuant to laws in force at the time such
Foreign Lender becomes a Lender hereunder (other than an assignee pursuant to a
request by a Borrower under Section 2.19(b)) or designates a new lending office
hereunder, or any additional U.S. federal withholding Tax that is imposed on
amounts payable to a Foreign Lender after the time such Foreign Lender becomes a
Lender hereunder or designates a new lending office hereunder, except that Taxes
in this clause (b) shall not include (i) additional U.S. federal withholding Tax
that may be imposed on amounts payable to a Foreign Lender after the time such
Foreign Lender becomes a party to the Agreement (or designates a new lending
office), as a result of a Change in Tax Law after such time and (ii) any amount
with respect to U.S. federal withholding Tax that such Foreign Lender (or its
assignor, if any) was previously entitled to receive pursuant to Section 2.17,
if any, with respect to such withholding Tax at the time such Foreign Lender
designates a new lending office (or at the time of the assignment), (c) any
Taxes attributable to such Recipient’s failure to comply with Section 2.17(f),
and (d) any U.S. federal withholding Tax imposed by FATCA.

“Existing Credit Agreement” means the Credit Agreement, dated as of November 16,
2010, among Holdings, the Company, the other loan parties from time to time
party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the
financial institutions from time to time party thereto.

“Existing Letters of Credit” means the letters of credit set forth on Schedule
2.06 hereto.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof and any agreements entered into
pursuant to Section 1471(b)(1) of the Code.

 

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“Federal Funds Effective Rate” means (a) the weighted average (rounded upwards,
if necessary, to the next 1/100 of 1%) of interest rates on overnight federal
funds transactions with members of the Federal Reserve System arranged by
federal funds brokers on the applicable Business Day (or on the preceding
Business Day, if the applicable day is not a Business Day), as published by the
Federal Reserve Bank of New York on the next Business Day; or (b) if no such
rate is published on the next Business Day, the average rate (rounded upwards,
if necessary, to the nearest 1/100 of 1%) charged to BofA on the applicable day
on such transactions, as determined by the Administrative Agent.

“Fee Letter” means that certain Fee Letter dated May 29, 2012, among MergerSub,
Goldman Sachs Lending Partners LLC, Merrill Lynch, Pierce, Fenner & Smith
Incorporated and BofA.

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

“First Lien Debt Cap” has the meaning assigned to such term in the Intercreditor
Agreement.

“First Lien Leverage Ratio” has the meaning assigned to such term (including
component definitions therein) in the Term Loan Agreement, as in effect on the
Term Loan Closing Date.

“First Lien Obligations” has the meaning assigned to such term in the
Intercreditor Agreement.

“Fixed Charges” means, with reference to any period, without duplication, cash
Interest Expense, plus scheduled principal payments on Indebtedness made during
such period, plus expense for income taxes paid in cash, plus dividends or
distributions and repurchases, redemptions or retirement of the Equity Interests
of Holdings (other than pursuant to the Transactions and repurchases of Equity
Interests by Holdings in the third and fourth fiscal quarters of 2011), in each
case paid in cash, all calculated for Holdings and its Restricted Subsidiaries
on a consolidated basis.; provided that any dividends or distributions made by
Holdings pursuant to Section 6.08(a)(vi) shall be excluded from Fixed Charges
for purposes of calculating compliance with Section 6.12.

“Fixed Charge Coverage Ratio” means, for any period, the ratio of (a) EBITDA
minus the unfinanced portion of Capital Expenditures to (b) Fixed Charges, all
calculated for Holdings and its Restricted Subsidiaries on a consolidated basis.

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

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

“Funding Accounts” means the deposit account(s) designated by Borrowers in
writing from time to time for the deposit of proceeds of any Borrowings.

“GAAP” means generally accepted accounting principles in the United States of
America.

“Glenwood” means Glenwood Acquisition LLC, a Delaware limited liability company.

 

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

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business or customary and
reasonable indemnity obligations in effect on the Effective Date or entered into
in connection with any acquisition or disposition of assets permitted under this
Agreement (other than such obligations with respect to Indebtedness). The amount
of any Guarantee shall be deemed to be an amount equal to the stated or
determinable amount of the Indebtedness or other obligation in respect of which
such Guarantee is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is required to
perform thereunder) as determined by such Person in good faith.

“Guaranteed Obligations” has the meaning assigned to such term in Section 10.01.

“Guarantor Percentage” has the meaning assigned to such term in Section 10.10.

“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.

“Hedge Obligations” means, with respect to a Loan Party, its obligations under a
Swap Agreement that constitutes a “swap” within the meaning of Section 1a(47) of
the Commodity Exchange Act.

“Holdings” means Interline Brands, Inc., a Delaware corporation.

“Holdings Notes” means the 10% / 10 3/4% senior unsecured notes due 2018 issued
by MergerSub pursuant to the Holdings Notes Indenture (and assumed by Holdings
in the Merger) and the Indebtedness represented thereby.

“Holdings Notes Documents” means the Holdings Notes Indenture and all other
instruments, agreements and other documents evidencing or governing the Holdings
Notes or providing for any Guarantee, obligation, security or other right in
respect thereof.

“Holdings Notes Indenture” means the Indenture, dated as of August 6, 2012,
between MergerSub and Wells Fargo Bank, National Association, as trustee, in
respect of the Holdings Notes.

“Holdings Refinancing Indebtedness” means a refinancing of the Holdings Notes
permitted pursuant to Sections 6.01(c) and (i).

 

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“Holdings Security Event” has the meaning set forth in Section 5.13(f).

“Immaterial Subsidiary” means, atas of any date of determination, any Restricted
Subsidiary that, at the last day of the Reference Period, when aggregated with
each other Restricted Subsidiary as to which a specified condition in Article
VII applies, accounted for less than (i) 5Subsidiary of the Company (a) having
Consolidated Total Assets in an amount of less than 5.0% of Consolidated Total
Assets and (b) contributing less than 5.0% of the consolidated revenues of the
Company and its Subsidiaries, in each case, for the most recently ended
Reference Period; provided that the Consolidated Total Assets (as so determined)
and revenues (as so determined) of all Immaterial Subsidiaries shall not exceed
5.0% of Consolidated Total Assets at such date and (ii) less than 5or 5.0% of
the consolidated gross revenues of Holdingsthe Company and its Restricted
Subsidiaries at such datefor the relevant Reference Period, as the case may be.

“Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (d) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business), (e) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed, (f) all Guarantees by such Person of
Indebtedness of others, (g) all Capital Lease Obligations of such Person,
(h) all obligations, contingent or otherwise, of such Person as an account party
in respect of letters of credit and letters of guaranty, (i) all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances,
(j) obligations under any liquidated earn-out, (k) all Swap Obligations of such
Person, (l) all Disqualified Stock of such Person and (m) any other Off-Balance
Sheet Liability. The Indebtedness of any Person shall include the Indebtedness
of any other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person’s ownership interest in or other relationship with such entity, except to
the extent the terms of such Indebtedness provide that such Person is not liable
therefor; provided, that (i) the term “Indebtedness” shall not include
(A) post-closing payment adjustments or unliquidated earn-outs to which the
seller in a Permitted Acquisition may be entitled or (B) any indebtedness or
other obligation for which irrevocable notice of redemption has been duly given
and for which adequate redemption consideration has been irrevocably deposited
with the applicable trustee or paying agent in trust for the holders of such
indebtedness or obligation or that has otherwise been defeased or satisfied and
discharged pursuant to the terms thereof, and (ii) notwithstanding any changes
in GAAP resulting from the implementation of lease accounting rules after the
Effective Date, no lease obligations shall be treated as Indebtedness to the
extent that such lease obligations would not have been treated as Indebtedness
prior to such change in GAAP.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or
with respect to any payment made by or on account of any obligation of any
Borrower hereunder and (b) to the extent not otherwise described in the
foregoing clause (a), Other Taxes.

“Indemnitee” has the meaning assigned to such term in Section 9.03(b).

“Indenture EBITDA” means “EBITDA” as defined in the Company Notes Indenture as
in effect on the date hereof; provided that:

(A) if Holdings or any Restricted Subsidiary has incurred any Indebtedness since
the beginning of the Reference Period that remains outstanding or if the
transaction giving rise to the need to calculate the Consolidated Total Debt to
EBITDA Ratio and/or the Secured Leverage Ratio is an incurrence of

 

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Indebtedness, or both, Indenture EBITDA for the Reference Period shall be
calculated after giving effect on a pro forma basis to such incurrence of
Indebtedness as if such Indebtedness had been incurred on the first day of the
Reference Period;

(B) if Holdings or any Restricted Subsidiary has repaid, repurchased, redeemed,
defeased or otherwise discharged any Indebtedness since the beginning of the
Reference Period or if any Indebtedness is to be repaid, repurchased, redeemed,
defeased or otherwise discharged on the date of the transaction giving rise to
the need to calculate the Consolidated Total Debt to EBITDA Ratio and/or the
Secured Leverage Ratio, Indenture EBITDA for the Reference Period shall be
calculated after giving effect on a pro forma basis to such discharge as if it
had occurred on the first day of the Reference Period and as if Holdings or such
Restricted Subsidiary had not earned the interest income, if any, actually
earned during the Reference Period in respect of cash or Permitted Investments
used to repay, repurchase, defease or otherwise discharge such Indebtedness;

(C) if, since the beginning of the Reference Period, Holdings or any Restricted
Subsidiary shall have made any disposition, Indenture EBITDA for the Reference
Period shall be reduced by an amount equal to Indenture EBITDA (if positive)
directly attributable to the assets which are the subject of such disposition
for the Reference Period, or increased by an amount equal to Indenture EBITDA
(if negative), directly attributable thereto for the Reference Period;

(D) the Indenture EBITDA attributable to discontinued operations, as determined
in accordance with GAAP, and operations or businesses (and ownership interests
therein) disposed of prior to the date of determination, will be excluded;

(E) if, since the beginning of the Reference Period, Holdings or any Restricted
Subsidiary (by merger or otherwise) shall have made an investment in any
Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary) or
an acquisition of assets, including any acquisition of assets occurring in
connection with a transaction requiring a calculation to be made hereunder,
which constitutes all or substantially all of an operating unit, division or
line of business, Indenture EBITDA for the Reference Period shall be calculated
after giving pro forma effect thereto (including the incurrence of any
Indebtedness) as if such investment or acquisition occurred on the first day of
the Reference Period; and

(F) if since the beginning of the Reference Period any Person (that subsequently
became a Restricted Subsidiary or was merged with or into any Restricted
Subsidiary since the beginning of the Reference Period) shall have made any
disposition, any investment or acquisition of assets that would have required an
adjustment pursuant to clause (C) or (E) above if made by Holdings or a
Restricted Subsidiary during the Reference Period, Indenture EBITDA for the
Reference Period shall be calculated after giving pro forma effect thereto as if
such disposition, investment or acquisition occurred on the first day of the
Reference Period.

For purposes of this definition, whenever pro forma effect is to be given to an
acquisition of assets and the amount of income or earnings relating thereto, the
pro forma calculations shall be determined in good faith by a Financial Officer
of Holdings. If any Indebtedness bears a floating rate of interest and is being
given pro forma effect, the interest on such Indebtedness shall be calculated as
if the rate in effect on the date of determination had been the applicable rate
for the entire period (taking into account any Swap Obligations applicable to
such Indebtedness). If any Indebtedness is incurred under a revolving credit
facility and is being given pro forma effect, the interest on such Indebtedness
shall be calculated based on the average daily balance of such Indebtedness for
the four fiscal quarters subject to the pro forma calculation, to the extent
that such Indebtedness was incurred for working capital purposes.

“Information” has the meaning assigned to such term in Section 9.12.

 

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“Intercompany Note” means a promissory note substantially in the form of Exhibit
F (or in such other form reasonably satisfactory to Administrative Agent)
evidencing Indebtedness owed among the Loan Parties.

“Intercreditor Agreement” means an Intercreditor Agreement entered into
following the Effective Date substantially in the form of Exhibit I with such
changes thereto as the Administrative Agent is authorized to enter into.

“Interest Coverage Ratio” has the meaning assigned to such term (including
component definitions therein) in the Term Loan Agreement, as in effect on the
Term Loan Closing Date; provided, that solely to the extent Section 6.01(t)
shall apply to Holdings Refinancing Indebtedness, the calculation of
“Consolidated Interest Expense” thereunder shall include Holdings.

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

“Interest Expense” means, with reference to any period, total interest expense
(including that attributable to Capital Lease Obligations) of Holdings and its
Restricted Subsidiaries for such period with respect to all outstanding
Indebtedness of Holdings and its Restricted Subsidiaries (including all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers’ acceptance financing and net costs under Swap Agreements
in respect of interest rates to the extent such net costs are allocable to such
period in accordance with GAAP), net of interest income to the extent deducted
in determining net income, calculated on a consolidated basis for Holdings and
its Restricted Subsidiaries for such period in accordance with GAAP; provided
that, notwithstanding any changes in GAAP resulting from the implementation of
lease accounting rules after the Effective Date, no lease payments shall be
treated as Interest Expense to the extent that such lease payments would not
have been treated as Interest Expense prior to such change in GAAP; provided,
further, that (i) except as provided in clause (ii) below, there shall be
excluded from Interest Expense for any period the cash interest expense (or cash
interest income) of all Unrestricted Subsidiaries for such period to the extent
otherwise included in Interest Expense, (ii) there shall be included in
determining Interest Expense for any period the cash interest expense (or
income) of any Acquired Entity or Business acquired since the beginning of such
period and of any Converted Restricted Subsidiary converted since the beginning
of such period, in each case based on the cash interest expense (or income) of
such Acquired Entity or Business or Converted Restricted Subsidiary for such
period (including the portion thereof occurring prior to such acquisition or
conversion) assuming any Indebtedness incurred or repaid in connection with any
such acquisition or conversion had been incurred or prepaid on the first day of
such period, and (iii) there shall be excluded from determining Interest Expense
for any period the cash interest expense (or income) of any Sold Entity or
Business disposed of since the beginning of such period, based on the cash
interest expense (or income) relating to any Indebtedness relieved, retired or
repaid in connection with any such disposition of such Sold Entity or Business
during such period (including the portion thereof occurring prior to such
disposal) assuming such debt relieved, retired or repaid in connection with such
disposition had been relieved, retired or repaid on the first day of such
period.

“Interest Payment Date” means (a) with respect to any ABR Loan (other than a
Swingline Loan), the first day of each calendar quarter and the Maturity Date,
and (b) with respect to any Eurodollar Loan, the last day of the Interest Period
applicable to the Borrowing of which such Loan is a part and, in the case of a
Eurodollar Borrowing with an Interest Period of more than 90 days’ duration,
each day prior to the last day of such Interest Period that occurs at intervals
of 90 days’ duration after the first day of such Interest Period and the
Maturity Date.

 

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“Interest Period” means with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is 30, 60, 90 or 180 days or, if
agreed to by all Lenders, 270 or 360 days thereafter, as the Borrower
Representative may elect; provided, that (i) if any Interest Period would end on
a day other than a Business Day, such Interest Period shall be extended to the
next succeeding Business Day unless, in the case of a Eurodollar Borrowing only,
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day and
(ii) any Interest Period pertaining to a Eurodollar Borrowing that commences on
the last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the last calendar month of such Interest
Period) shall end on the last Business Day of the last calendar month of such
Interest Period. For purposes hereof, the date of a Borrowing initially shall be
the date on which such Borrowing is made and, in the case of a Revolving
Borrowing, thereafter shall be the effective date of the most recent conversion
or continuation of such Borrowing.

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

“Inventory Appraisal” means (a) on the Effective Date, the appraisal of the
Borrowers’ and the other Loan Guarantors’ Inventory prepared by HILCO Appraisal
Services, LLC dated June 27, 2012 and (b) thereafter, the most recent inventory
appraisal conducted by an independent appraisal firm selected and engaged by the
Administrative Agent and delivered pursuant to Section 5.10.

“Inventory Reserve” shall mean the total reserve against Inventory equal to the
sum of the following:

(a) a reserve for shrink, or discrepancies that arise pertaining to inventory
quantities on hand between a Borrower’s perpetual accounting system and
inventory counts, in each case, as estimated by the Borrowers in accordance with
past practices; and

(b) a reserve determined by the Administrative Agent in the exercise of its
Permitted Discretion for Inventory which is designated returned to vendor or
which is recognized as damaged or off quality or not to customer specifications
by a Borrower; and

(c) a revaluation reserve whereby capitalized favorable variances shall be
deducted from Eligible Inventory and unfavorable variances shall not be added to
Eligible Inventory; and

(d) any other reserve as deemed appropriate by the Administrative Agent in its
Permitted Discretion, from time to time.

“Issuing Bank” means, as the context may require, (a) BofA, with respect to
Letters of Credit issued by it (including the Existing Letters of Credit), and
each of its successors in such capacity as provided in Section 2.06(i), and
(b) any other Lender that becomes an Issuing Bank pursuant to Section 2.06(i),
with respect to Letters of Credit issued by it and in each case, its successors
in such capacity as provided in Section 2.06(i). An Issuing Bank may, in its
discretion, arrange for one or more Letters of Credit to be issued by Affiliates
of such Issuing Bank, in which case the term “Issuing Bank” shall include any
such Affiliate with respect to Letters of Credit issued by such Affiliate.

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

“Joint Bookrunners” means Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Goldman Sachs Lending Partners LLC.

 

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“Junior Indebtedness” means any Subordinated Indebtedness or Indebtedness
secured by Liens that are expressly junior to the Liens of the Administrative
Agent with respect to the Collateral (other than Indebtedness among Holdings and
its Subsidiaries and/or under the Term Loan Agreement).

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

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

“LC Exposure” means, at any time, the sum of the Commercial LC Exposure and the
Standby LC Exposure. The LC Exposure of any Revolving Lender at any time shall
be its Applicable Percentage of the total LC Exposure at such time.

“Lead Arrangers” means Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Goldman Sachs Lending Partners LLC.

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

“Letter of Credit” means any letter of credit issued pursuant to this Agreement,
including the Existing Letters of Credit.

“LIBOR” means for any Interest Period with respect to a Eurodollar Borrowing,
the per annum rate of interest (rounded up, if necessary, to the nearest 1/16th
of 1%), determined by the Administrative Agent at approximately 11:00 a.m.
(London time) two Business Days prior to commencement of such Interest Period,
for a term comparable to such Interest Period, equal to (a) the British Bankers
Association LIBOR Rate (“BBA LIBOR”)ICE Benchmark Administration LIBOR Rate, or
successor thereto if such association is no longer making such rate available,
as published by Reuters (or other commercially available source designated by
the Administrative Agent); or (b) if BBA LIBOR is not availablethe rate
described in clause (a) is unavailable for any reason, the interest rate at
which dollar deposits in the approximate amount of the Eurodollar Borrowing
would be offered by BofAthe Administrative Agent’s London branch to major banks
in the London interbank Eurodollar market. If the Board imposes a Reserve
Percentage with respect to LIBOR deposits, then LIBOR shall be the foregoing
rate, divided by 1 minus the Reserve Percentage.

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

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

 

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“Loan Guarantor” means each Loan Party (other than a Borrower in respect of
Secured Obligations as to which such Borrower is the primary obligor).

“Loan Guaranty” means Article X of this Agreement.

“Loan Parties” means Holdings, the Borrowers, the Borrowers’ Domestic
Subsidiaries (other than any Excluded Subsidiary) and any other Person who
becomes a party to this Agreement pursuant to a Joinder Agreement and their
successors and assigns.

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

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

“Material Indebtedness” means Indebtedness (other than the Loans and Letters of
Credit), or obligations in respect of one or more Swap Agreements, of any one or
more of Holdings, the Company and its Restricted Subsidiaries in an aggregate
principal amount exceeding $20,000,000.35,000,000. For purposes of determining
Material Indebtedness, the “obligations” of Holdings, the Company or any
Restricted Subsidiary in respect of any Swap Agreement at any time shall be the
maximum aggregate amount (giving effect to any netting agreements) that
Holdings, the Company or such Restricted Subsidiary would be required to pay if
such Swap Agreement were terminated at such time.

“Maturity Date” means September 7, 2017 or any earlier date on which the
Commitments are reduced to zero or otherwise terminated pursuant to the terms
hereof.

“Maximum Liability” has the meaning assigned to such term in Section 10.09.

“Maximum Rate” has the meaning assigned to such term in Section 9.17.

“Merger” means the merger of MergerSub with and into Holdings in accordance with
the terms of the Merger Agreement, with Holdings being the surviving entity.

“Merger Agreement” means that certain Agreement and Plan of Merger dated as of
May 29, 2012, as amended by the Acknowledgement, Waiver and Consent made as of
June 28, 2012 (the “Acknowledgement and Waiver”), executed by and among Newco,
MergerSub and Holdings, including all exhibits, schedules and disclosure letters
thereto.

“Merger Consideration” means the consideration received by the equity holders of
Holdings for their equity interests in Holdings in accordance with the terms of,
and subject to adjustment as provided in, the Merger Agreement (including any
consideration paid to dissenting equity holders).

“MergerSub” means Isabelle Acquisition Sub Inc., a Delaware corporation.

 

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

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

“Net Income” means, for any period, the consolidated net income (or loss) of
Holdings and its Restricted Subsidiaries, determined on a consolidated basis in
accordance with GAAP; provided that there shall be excluded (a) the income (or
deficit) of any Person accrued prior to the date it becomes a Subsidiary or is
merged into or consolidated with Holdings or any of its Restricted Subsidiaries,
(b) the income (or deficit) of any Person (other than a Restricted Subsidiary)
in which Holdings or any of its Restricted Subsidiaries has an ownership
interest, except to the extent that any such income is actually received by
Holdings or such Restricted Subsidiary in the form of dividends or similar
distributions, (c) the undistributed earnings of any Restricted Subsidiary
(other than a Loan Party) to the extent that the declaration or payment of
dividends or similar distributions by such Restricted Subsidiary is not at the
time permitted by the terms of any contractual obligation (other than under any
Loan Document) or Requirement of Law applicable to such Restricted Subsidiary,
(d) the cumulative effect of a change in accounting principles during such
period to the extent included in Net Income and (e) any income (loss) for such
period attributable to the early extinguishment of Indebtedness. Notwithstanding
any changes in GAAP resulting from the implementation of lease accounting rules
after the Effective Date, lease payments shall be treated as expenses when
calculating Net Income to the extent such payments relate to leases that would
have been treated as operating leases prior to such change in GAAP.

“Net Orderly Liquidation Value” means the orderly liquidation value (net of
costs and expenses estimated to be incurred in connection with such liquidation)
of the Eligible Inventory that is estimated to be recoverable in an orderly
liquidation of such Eligible Inventory, as determined from time to time by
reference to the most recent Inventory Appraisal.

“Net Proceeds” means, with respect to any event, (a) the cash proceeds received
in respect of such event including (i) any cash received in respect of any
non-cash proceeds (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or purchase
price adjustment receivable or otherwise, but excluding any interest payments),
but only as and when received, (ii) in the case of a casualty, insurance
proceeds and (iii) in the case of a condemnation or similar event, condemnation
awards and similar payments, net of (b) the sum of (i) all reasonable fees and
out-of-pocket expenses paid to third parties (other than Affiliates unless paid
in compliance with Section 6.09) in connection with such event (including any
underwriting, brokerage or other customary selling commissions, reasonable
legal, advisory and other fees and expenses, including title and recording
expenses, associated therewith), (ii) in the case of a sale, transfer or other
disposition of an asset (including pursuant to a sale and leaseback transaction
or a casualty or a condemnation or similar proceeding), the amount of all
payments required to be made as a result of such event to repay Indebtedness
(other than Loans) secured by such asset or otherwise subject to mandatory
prepayment as a result of such event, (iii) the amount of all taxes paid (or
reasonably estimated to be payable) and (iv) the amount of any reserves
established to fund contingent liabilities (including post-closing adjustments)
reasonably estimated to be payable, in each case during the year that such event
occurred or the next succeeding year and that are directly attributable to such
event (as determined reasonably and in good faith by a Financial Officer).

“Newco” means Isabelle Holding Company Inc., a Delaware corporation, as such
corporation is to be converted into a Delaware limited liability company
pursuant to the Acknowledgement and Waiver, and merged with and into Holdings
promptly following the consummation of the Merger.

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

“Non-Paying Guarantor” has the meaning assigned to such term in Section 10.10.

 

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“Notes” means the Company Notes and the Holdings Notes.

“Notes Documents” means the Company Notes Documents and the Holdings Notes
Documents.

“Obligated Party” has the meaning assigned to such term in Section 10.02.

“Obligations” means all unpaid principal of and accrued and unpaid interest on
the Loans, all LC Exposure, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations of the Loan Parties to the
Lenders or to any Lender, the Administrative Agent, any Issuing Bank or any
indemnified party arising under the Loan Documents.

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

“Operating Account” means account #898046220250, any disbursement account, and
any replacement accounts or additional accounts of any Loan Party maintained
with BofA as a zero balance, cash management account pursuant to and under any
agreement between such Loan Party and BofA, as modified and amended from time to
time, and through which all disbursements of any Loan Party and any designated
Subsidiary of any Borrower are made and settled on a daily basis with no
uninvested balance remaining overnight.

“Other Taxes” means any and all present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies arising from any
payment made hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement, except any such Taxes that are
Connection Taxes imposed with respect to any assignment of a Loan or Commitment
(other than an assignment made pursuant to Section 2.19(b)) treating the
assignee and assignor with respect to any assignment as the Recipient for
purposes of the definition of “Connection Taxes.”

“Overadvance” has the meaning assigned to such term in Section 2.04(a).

“Parent” has the meaning assigned to such term in the term “Permitted Payments
to Parent”.

“Participant” has the meaning assigned to such term in Section 9.04(c).

“Participant Register” has the meaning assigned to such term in Section 9.04(c).

“Patriot Act” means the Uniting And Strengthening America By Providing
Appropriate Tools Required To Intercept And Obstruct Terrorism Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001)).

“Paying Guarantor” has the meaning assigned to such term in Section 10.10.

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

“Permitted Acquisition” means any Acquisition by any Loan Party or a Restricted
Subsidiary in a transaction that satisfies each of the following requirements:

(a) such Acquisition is not a hostile or contested Acquisition and shall have
been approved by the proposed target’s (or proposed target’s parent’s) board of
directors (or equivalent) governing body;

 

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(b) the business acquired in connection with such Acquisition is not in any
material fashion engaged, directly or indirectly, in any line of business other
than the businesses in which any Borrower or any Loan Party is engaged on the
Effective Date and any business activities that are similar, related,
incidental, complementary or corollary thereto or a reasonable extension
thereof;

(c) if such Acquisition is an Acquisition of the Equity Interests of a Person,
such Acquisition (i) is structured so that the acquired Person shall become a
Loan Party or a Restricted Subsidiary pursuant to the terms of this Agreement,
provided, that such Person shall be permitted to become an Unrestricted
Subsidiary if, after giving pro forma effect to such Acquisition, either
(A) both (1) Availability is greater than the higher of 1512.5% of the
Commitments and $37,500,00031,250,000 and (2) the Fixed Charge Coverage Ratio as
of the last day of the Reference Period is greater than 1.0 to 1.0 or
(B) Availability is greater than the higher of 2017.5% of the Commitments and
$50,000,000,43,750,000, and (ii) together with the consummation of the
transactions contemplated in Section 5.13 in connection with such Acquisition,
will not result in any violation of Regulation U;

(d) at or prior to the closing of the Acquisition, Holdings (or its Restricted
Subsidiary making such Acquisition) and the proposed target (and, to the extent
required, its Restricted Subsidiaries) shall have executed such documents, and
taken such action, required under Section 5.13;

(e) any Borrower or any Loan Guarantor shall not, as a result of or in
connection with any such Acquisition, assume or incur any direct or contingent
liabilities (whether relating to environmental, tax, litigation, or other
matters) that could reasonably be expected to have a Material Adverse Effect;

(f) in connection with an Acquisition of the Equity Interests in any Person
which becomes a Restricted Subsidiary, all Liens on property of such Person
shall be terminated unless such Liens are permitted pursuant to the Loan
Documents, and in connection with an Acquisition of the assets of any Person,
all Liens on such assets shall be terminated unless such Liens are permitted
pursuant to the Loan Documents;

(g) all material governmental and third-party approvals necessary in connection
with such Acquisition shall have been obtained and be in full force and effect;

(h) no Default or Event of Default exists or would result therefrom;

(i) as soon as available, but not less than five (5) days (or such shorter
period as approved by the Administrative Agent) prior to the consummation of any
Acquisition having an Acquisition Consideration in excess of $75,000,000, the
Borrower Representative shall provide to the Administrative Agent (i) notice of
such Acquisition, (ii) a copy of the final form (or, if not available, the
current draft) for the purchase agreement and all schedules and exhibits thereto
and (iii) a certificate of a senior officer of the Borrower Representative
certifying (and showing the calculations therefor in reasonable detail) that the
Loan Parties would be in compliance with the requirements of clauses (c) through
(h) preceding, including, if applicable, pro forma financial statements
indicating compliance with Section 6.04(p); and

(j) prior to inclusion of the Accounts and Inventory acquired in connection with
any such Acquisition in the determination of the Borrowing Base (which, for the
avoidance of doubt, must be owned by a Borrower), (i) the Administrative Agent
shall have obtained an Inventory Appraisal with respect to such Inventory and
conducted an audit and field examination of such Accounts to its reasonable
satisfaction; provided, that such acquired Accounts and Inventory that otherwise
satisfy the eligibility

 

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criteria (as determined in good faith by the Company based on a review of such
eligibility criteria and the due diligence for such Acquisition) may be included
in the Borrowing Base for a period not to exceed 60 days and in an aggregate
amount not to exceed 10% of the Borrowing Base pending such field examination
and appraisal and (ii) any applicable Reserves have been established by the
Administrative Agent in consultation with the Company, and all appropriate lien
filings and collateral documentation have been duly completed, executed and
delivered to the Administrative Agent, in each case, to the extent required by,
and in accordance with, the Loan Documents.

“Permitted Discretion” means a determination made in good faith and in the
exercise of reasonable (from the perspective of a secured asset-based lender)
business judgment and subject to the requirements, as applicable, of
Section 2.22.

“Permitted Encumbrances” means:

(a) Liens imposed by law for taxes, assessments or other governmental charges or
levies that are not yet due or are being contested in compliance with
Section 5.04;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other
like Liens imposed by law, arising in the ordinary course of business and
securing obligations that are not overdue by more than 45 days or are being
contested in compliance with Section 5.04;

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

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

(e) judgment liens in respect of judgments that do not constitute an Event of
Default under clause (k) of Section 7.01;

(f) easements, zoning restrictions, rights-of-way, minor defects or
irregularities of title and similar encumbrances on real property that do not
secure any monetary obligations and do not materially interfere with the
ordinary conduct of business of any Borrower or any Restricted Subsidiary;

(g) landlords’ and lessors’ and other like Liens in respect of rent not in
default; and

(h) any interest or title of a lessee, licensee, lessor or licensor under any
lease or sublease entered into by a Borrower or any of its Subsidiaries in the
ordinary course of its business and covering only the assets so leased or
licensed;

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

“Permitted Holders” means (a) the Sponsors and members of management of
Holdings, the Company or a direct or indirect parent of Holdings and (b) any
group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the
Securities Exchange Act of 1934 or any successor provision) of which any of the
foregoing are members; provided, however, that, in the case of such group and
without giving effect to the existence of such group or any other group, the
entities set forth in the foregoing clause (a), collectively, have beneficial
ownership of Equity Interests representing more than 50% of the aggregate
ordinary voting power represented by the issued and outstanding Equity Interests
of Holdings or any direct or indirect parent of Holdings.

 

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“Permitted Investments” means:

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

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

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

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

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

(f) investments in securities with maturities of six months or less from the
date of acquisition and rated at least “A” by S&P or “A” by Moody’s (or, if at
any time neither S&P nor Moody’s shall be rating such obligations, an equivalent
rating from another nationally recognized rating service).

“Permitted Payments to Parent” means, without duplication as to amounts:

(a) any Restricted Payment made to any direct or indirect parent company of
Holdings (collectively, a “Parent”) to be used by Parent solely (i) to pay its
franchise taxes and other fees required to maintain its corporate existence,
(ii) to pay for general corporate and overhead expenses (including salaries and
other compensation (including bonuses and benefits) of the employees and
directors, board activities, insurance, legal, accounting, corporate reporting
and filing, administrative and other general operating expenses) incurred by
Parent in the ordinary course of business and attributable to the ownership or
operations of Holdings and its Subsidiaries, (iii) to pay any reasonable and
customary indemnification claims made by directors or officers of the Company or
Parent and attributable to the ownership or operations of Holdings and its
Subsidiaries, (iv) to pay expenses incurred in connection with offerings of
securities, debt financings, acquisitions, dispositions or other non-ordinary
course transactions for Holdings and its Subsidiaries and (v) to satisfy
principal, interest and other payment obligations of Holdings on Indebtedness of
Parent, the proceeds of which were contributed to Holdings; provided, however,
that all such Restricted Payments pursuant to this clause (a) shall not exceed
in the aggregate $15,000,000 per year; and

(b) payments to Parent in respect of federal, state or local income, franchise
or similar taxes of Holdings and its Subsidiaries (“Tax Payments”); provided,
however, that the aggregate Tax Payments shall not exceed (i) the aggregate
amount of the relevant tax (including any penalties and interest) that Holdings
would owe after the Effective Date for United States Federal, state and local
income tax purposes filing a separate tax return (or a consolidated or combined
return with any Subsidiaries of Holdings that are members of a consolidated or
combined group with Parent), taking into account any carryovers and

 

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carrybacks of tax attributes (such as net operating losses) of Holdings and its
Subsidiaries, less (ii) the amount of any income taxes that Holdings or its
Subsidiaries pay directly to a taxing authority after the Effective Date.

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

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

“Post-Acquisition Period” means, with respect to any Permitted Acquisition, the
period beginning on the date such Permitted Acquisition is consummated and
ending on the last day of the fourth full consecutive fiscal quarter immediately
following the date on which such Permitted Acquisition is consummated.

“Prime Rate” means the rate of interest announced by BofA from time to time as
its prime rate. Such rate is set by BofA on the basis of various factors,
including its 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 rate. Any change in such rate announced by BofA
shall take effect at the opening of business on the day specified in the public
announcement of such change.

“Pro Forma Adjustment” means for the most recently ended four fiscal quarters
that includes all or any part of a fiscal quarter ending prior to the end of any
Post-Acquisition Period, with respect to the Acquired EBITDA of the applicable
Acquired Entity or Business or the EBITDA of Holdings and its Subsidiaries, the
pro forma increase or decrease in such Acquired EBITDA or such EBITDA, as the
case may be, projected in good faith as a result of (a) actions taken or
expected to be taken during such Post-Acquisition Period for the purposes of
realizing reasonably identifiable and factually supportable cost savings or
(b) any additional costs incurred during such Post-Acquisition Period, in each
case in connection with the combination of the operations of such Acquired
Entity or Business with the operations of the Borrowers and the Restricted
Subsidiaries; provided that, so long as such actions are taken or expected to be
taken during such Post-Acquisition Period or such costs are incurred during such
Post-Acquisition Period, as applicable, it may be assumed, for purposes of
projecting such pro forma increase or decrease to such Acquired EBITDA or such
EBITDA, as the case may be, that such cost savings will be realizable during the
entirety of the most recently ended four fiscal quarters, or such additional
costs, as applicable, will be incurred during the entirety of such the most
recently ended four fiscal quarters; provided further that any such pro forma
increase or decrease to such Acquired EBITDA or such EBITDA, as the case may be,
shall be without duplication for cost savings or additional costs already
included in such Acquired EBITDA or such EBITDA, as the case may be, for the
most recently ended four fiscal quarters.

“Pro Forma Adjustment Certificate” means any certificate of a Financial Officer
of Holdings delivered pursuant to Section 5.01(c).

“Pro Forma Basis” has the meaning assigned to such term in the Term Loan
Agreement, as in effect on the Term Loan Closing Date and inclusive of the
effect of Section 1.04 of the Term Loan Agreement thereon (but, for the
avoidance of doubt, such definition does not apply to the term “pro forma basis”
used without capitalization herein).

“Pro Forma Entity” has the meaning assigned to such term in the definition of
“Acquired EBITDA”.

 

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“Projections” has the meaning assigned to such term in Section 5.01(d).

“Protective Advances” has the meaning assigned to such term in Section 2.04(a).

“Qualified ECP” means a Loan Party with total assets exceeding $10,000,000, or
that constitutes an “eligible contract participant” under the Commodity Exchange
Act and can cause another Person to qualify as an “eligible contract
participant” under Section 1a(18)(A)(v)(II) of such act.

“Qualified Holdings Debt” means unsecured Indebtedness of Holdings (other than
the Holdings Notes and any Holdings Refinancing Indebtedness) that (a) is not
subject to any Guarantee by any Subsidiary of Holdings, (b) will not mature
prior to the date that is 180 days after the Maturity Date, (c) has no scheduled
amortization or scheduled payments of principal prior to the date that is 180
days after the Maturity Date and is not subject to mandatory redemption,
repurchase, prepayment or sinking fund obligation (it being understood that such
Indebtedness may have mandatory prepayment, repurchase or redemption provisions
satisfying the requirements of clause (d) below), and (d) has mandatory
prepayment, repurchase or redemption, covenant, default and remedy provisions
customary for senior discount notes of an issuer that is the parent of a
borrower under senior secured credit facilities; provided, that the Company
shall have delivered a certificate of a Financial Officer to the Administrative
Agent at least five Business Days prior to the incurrence of such Indebtedness,
together with a reasonably detailed description of the material terms and
conditions of such Indebtedness or drafts of the documentation relating thereto,
stating that the Company has reasonably determined in good faith that such terms
and conditions satisfy the foregoing requirement (and such certificate shall be
conclusive evidence that such terms and conditions satisfy the foregoing
requirement unless the Administrative Agent notifies the Company within such
five Business Day period that it disagrees with such determination (including a
reasonably detailed description of the basis upon which it disagrees));
provided, further, that any such Indebtedness shall constitute Qualified
Holdings Debt only if immediately after giving effect to the issuance or
incurrence thereof and the use of proceeds thereof, no Event of Default shall
have occurred and be continuing.

“Qualifying IPO” means the issuance and sale by Holdings or any other Person of
which Holdings is a direct or indirect wholly-owned Subsidiary of its Equity
Interests in an underwritten primary public offering (other than a public
offering pursuant to a registration statement on Form S-8) pursuant to an
effective registration statement filed with the SEC in accordance with the
Securities Act (whether alone or in connection with a secondary public offering)
pursuant to which Net Proceeds of at least $30,000,000 are received by or
contributed to the Company.

“Recipient” means (a) the Administrative Agent, (b) any Lender and (c) any
Issuing Bank, as applicable, in its capacity as a Person receiving a payment
under the Loan Documents.

“Reference Period” means the most recent four consecutive fiscal quarters for
which financial statements have been delivered pursuant Section 5.01(a) or
Section 5.01(b).

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

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

“Rent Reserve” means the aggregate of (a) all past due rent and other amounts
owing by a Loan Party to any landlord, warehouseman, processor, repairman,
mechanic, shipper, freight forwarder, broker or other Person who possesses, any
Collateral or could assert a Lien on any Collateral and (b) a reserve equal to
at least three months’ rent and other charges that could be payable to any such
Person (unless it has executed a Collateral Access Agreement).

 

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

“Required Lenders” means, at any time, Lenders having Credit Exposure and unused
Commitments representing more than 50% of the sum of the total Credit Exposure
and unused Commitments at such time.

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

Reserve Percentage: the reserve percentage (expressed as a decimal, rounded up
to the nearest 1/16th of 1%) applicable to member banks under regulations issued
by the Board for determining the maximum reserve requirement for Eurocurrency
liabilities.

“Reserves” means the Debt Reserve, Dilution Reserve, Inventory Reserve, Rent
Reserve, Banking Services Reserve, reserve for Swap Obligations and any other
reserves which the Administrative Agent deems necessary, in its Permitted
Discretion, to maintain with respect to the Collateral or any Loan Party.

“Restricted Debt Payments” has the meaning assigned to such term in Section
6.08(b).

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

“Restricted Subsidiary” means any Subsidiary of a Borrower or Holdings other
than an Unrestricted Subsidiary.

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

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

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

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

“SEC” means the Securities and Exchange Commission.

 

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“Second Supplemental Indenture” has the meaning assigned to such term in the
term “Company Notes Indenture”.

“Secured Leverage Ratio” means, as of any date of determination, the ratio of
(a) Consolidated Secured Debt as of such date to (b) Indenture EBITDA for the
Reference Period.

“Secured Obligations” means all Obligations, together with all (a) Banking
Services Obligations and (b) Swap Obligations owing to one or more Lenders, Lead
Arrangers or their respective Affiliates at the time of the entry into such Swap
Obligations; provided that, other than with respect to BofA and its Affiliates,
within ten (10) Business Days (or such later time as the Administrative Agent
and the Borrower Representative may agree in their reasonable discretion) after
any transaction relating to such Banking Services Obligation or Swap Obligation
is entered into, the Borrower Representative and the Lender, Lead Arranger or
Affiliate of a Lender or Lead Arranger party thereto shall have delivered
written notice (including by e-mail) to the Administrative Agent (i) stating
that such a transaction has been entered into and that it constitutes a Secured
Obligation entitled to the benefits of the Collateral Documents, (ii) describing
such Banking Services Obligation or Swap Obligation and setting forth the
maximum amount to be secured by the Collateral and the methodology to be used in
calculating such amount, which amount may be established or increased (by
further written notice to the Administrative Agent from time to time) as long as
no Default or Event of Default exists and no Overadvance would result therefrom
and (iii) agreeing to be bound by Section 2.18(b) and Article VIII; provided,
further, that the Secured Obligations of a Loan Party shall not include its
Excluded Swap Obligations.

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

“Securities Act” means the Securities Act of 1933 and the rules and regulations
of the SEC promulgated thereunder.

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

“Settlement” has the meaning assigned to such term in Section 2.05(c).

“Settlement Date” has the meaning assigned to such term in Section 2.05(c).

“Sold Entity or Business” has the meaning assigned to such term in the
definition of “EBITDA”.

“Solvency Certificate” has the meaning assigned to such term in Section 4.01(f).

“Specified Distribution” means a distribution made by Holdings on the Effective
Date to fund a portion of the Merger Consideration and to pay the fees and
expenses incurred in connection with the Transactions.

“Specified Equity Contribution” has the meaning assigned to such term in
Section 7.02(a).

“Specified Investment” has the meaning assigned to such term in Section 6.04(p).

“Specified Loan Party” means a Loan Party that is not then an “eligible contract
participant” under the Commodity Exchange Act (determined prior to giving effect
to Section 10.12).

 

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“Specified Merger Agreement Representations” means such of the representations
made by (or related to) Holdings and its Subsidiaries with respect to Holdings
and its Subsidiaries in the Merger Agreement as are material to the interests of
the Lenders, but only to the extent that Newco has (or its applicable affiliate
has) the right to terminate its obligations (or otherwise not have an obligation
to close) under the Merger Agreement as a result of a breach of one or more of
such representations in the Merger Agreement.

“Specified Properties” means the properties (and the improvements thereon) owned
by the Company and its Restricted Subsidiaries that are identified on Schedule
1.01 hereto.

“Sponsors” means GS Capital Partners VI, L.P., P2 Capital Master Fund I, L.P.
and their respective Affiliates.

“Standby LC Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding standby Letters of Credit at such time and (b) the
aggregate amount of all LC Disbursements relating to standby Letters of Credit
that have not yet been reimbursed by or on behalf of the Borrowers at such time.
The Standby LC Exposure of any Revolving Lender at any time shall be its
Applicable Percentage of the total Standby LC Exposure at such time.

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

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

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

“Supermajority Lenders” means, at any time, Lenders having Credit Exposure and
unused Commitments representing at least 66.67% of the sum of the total Credit
Exposure and unused Commitments at such time.

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

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

 

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“Swingline Exposure” means, at any time, the sum of the aggregate amount of all
outstanding Swingline Loans at such time. The Swingline Exposure of any
Revolving Lender at any time shall be its Applicable Percentage of the total
Swingline Exposure at such time.

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

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

“Syndication Agent” means Goldman Sachs Lending Partners LLC.

“Tax Payments” has the meaning assigned to such term in the definition for
“Permitted Payments to Parent”.

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

“Term Loans” means the loans and advances made pursuant to the Term Loan
Agreement by the lenders from time to time party thereto.

“Term Loan Agreement” means that certain First Lien Term Loan Agreement dated as
of March 17, 2014, among the Company, as borrower, Holdings and the subsidiaries
of the Company from time to time party thereto, as guarantors, Barclays Bank
PLC, as administrative agent, and the lenders from time to time party thereto,
as it may be amended or otherwise modified or replaced from time to time.

“Term Loan Closing Date” means the date on which the initial Term Loans are
advanced under the initial Term Loan Agreement.

“Term Loan Documents” has the meaning assigned to the term “Loan Documents” in
the Term Loan Agreement (or any similar term in any successor agreement).

“Total Leverage Ratio” has the meaning assigned to such term (including the
component definitions therein) in the Term Loan Agreement, as in effect on the
Term Loan Closing Date.

“Transactions” means (a) the execution, delivery and performance by the Loan
Parties of this Agreement, the borrowing of Loans and other credit extensions,
the use of the proceeds thereof in accordance with Section 5.08 and the issuance
of Letters of Credit hereunder, (b) the consummation of the Equity Contribution,
(c) the consummation of the Merger and the payment of the Merger Consideration
in accordance with the terms of the Merger Agreement, (d) the issuance of the
Holdings Notes and (e) the execution and delivery of, and solicitation of
consents for, the Second Supplemental Indenture.

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

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

 

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

“Unrestricted Subsidiary” means any Subsidiary of any Borrower that is acquired
or created after the Effective Date and designated by the Borrower
Representative at the time of acquisition or formation thereof as an
Unrestricted Subsidiary hereunder by written notice to the Administrative Agent;
provided that the Borrowers shall only be permitted to so designate a new
Unrestricted Subsidiary after the Effective Date and so long as:

(a) immediately before and after such designation, no Default or Event of
Default shall have occurred and be continuing;

(b) no Subsidiary may be designated as an Unrestricted Subsidiary if it is a
“Restricted Subsidiary” for the purpose of the Term Loan Documents, the Holdings
Notes Documents or any other Indebtedness of Holdings or its Subsidiaries (other
than Indebtedness of another Unrestricted Subsidiary); and

(c) no Unrestricted Subsidiary may be redesignated as a Restricted Subsidiary at
any time after being so designated as an Unrestricted Subsidiary;

(d) immediately after giving effect to such designation, Holdings, the Company
and its Restricted Subsidiaries shall be in compliance, on a pro forma basis,
with the covenant set forth in Section 6.12, whether or not a Covenant Trigger
Period then exists, as demonstrated to the reasonable satisfaction of the
Administrative Agent;

(e) no Subsidiary shall be designated as an Unrestricted Subsidiary if such
Subsidiary owns (directly or indirectly) any Equity Interests or Indebtedness
of, or holds Liens on any property of, Holdings, any Borrower or any Restricted
Subsidiary; and

(f) no Subsidiary shall be designated as an Unrestricted Subsidiary if it (i) is
a party to any agreement, contract, arrangement or understanding with Holdings,
any Borrower or any Restricted Subsidiary unless the terms of any such
agreement, contract, arrangement or understanding are no less favorable to
Holdings, such Borrower or such Restricted Subsidiary than those that might be
obtained at the time from Persons who are not Affiliates of Holdings, any
Borrower or any Restricted Subsidiary, and (ii) is a Person with respect to
which Holdings, any Borrower or any of the Restricted Subsidiaries has any
direct or indirect obligation (A) to subscribe for additional Equity Interests
or (B) to maintain or preserve such Person’s financial condition or to cause
such Person to achieve any specified levels of operating results.

The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute
an investment by its parent therein at the date of designation in an amount
equal to the net book value of its parent’s investment immediately prior to such
designation therein. Any contingent obligations or Guarantee incurred by
Holdings, any Borrower or any Restricted Subsidiary in respect of any
Indebtedness or other obligations of the Subsidiary being so designated
(including those incurred prior to such designation) will be deemed to have been
incurred at the time of such designation.

“U.S. Tax Certificate” has the meaning assigned to such term in Section 2.17(f).

“Wilmar Financial” has the meaning assigned to such term in the preamble of this
Agreement.

 

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“Wilmar Holdings” has the meaning assigned to such term in the preamble of this
Agreement.

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

“Withholding Agent” means any Borrower or the Administrative Agent as required
by applicable Requirement of Law.

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

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

SECTION 1.04 Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided that, if the
Borrower Representative notifies the Administrative Agent that the Borrowers
request an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower Representative that the Required Lenders request an amendment to any
provision hereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then
such provision shall be interpreted on the basis of GAAP as in effect and
applied immediately before such change shall have become effective until such
notice shall have been withdrawn or such provision amended in accordance
herewith. In the event that historical accounting practices, systems or reserves
relating to the components of the Borrowing Base are modified in a manner that
is adverse to the Lenders in any material respect, the Borrowers will agree to
maintain such additional reserves (for purposes of computing the Borrowing Base)
in respect to the components of the Borrowing Base and make such other
adjustments (which may include maintaining additional reserves, modifying the
advance rates or modifying the eligibility criteria for the components of the
Borrowing Base) as may be requested by the Administrative Agent in its
reasonable credit judgment.

 

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ARTICLE II

THE CREDITS

SECTION 2.01 Commitments. Subject to the terms and conditions set forth herein,
each Lender agrees to make Revolving Loans to the Borrowers from time to time
during the Availability Period in an aggregate principal amount that will not
result in (a) such Lender’s Credit Exposure exceeding such Lender’s Commitment
or (b) the Aggregate Credit Exposure exceeding the lesser of (x) the Commitments
or (y) the Borrowing Base, subject to the Administrative Agent’s authority, in
its sole discretion, to make Protective Advances pursuant to the terms of
Section 2.04. Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrowers may borrow, prepay and reborrow
Revolving Loans.

SECTION 2.02 Loans and Borrowings. (a) Each Loan (other than a Swingline Loan)
shall be made as part of a Borrowing consisting of Loans of the same Class and
Type made by the Lenders ratably in accordance with their respective
Commitments. Any Protective Advance and any Swingline Loan shall be made in
accordance with the procedures set forth in Sections 2.04 and 2.05,
respectively.

(b) Subject to Section 2.14, each Revolving Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower Representative may
request in accordance herewith, provided that all Borrowings made on the
Effective Date must be made as ABR Borrowings but may be converted into
Eurodollar Borrowings in accordance with Section 2.08. Each Swingline Loan shall
be an ABR Loan. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrowers to repay such Loan in accordance with the terms of this
Agreement; provided further that any such branch or Affiliate shall be treated
for purposes of Section 2.17 of this Agreement (and related defined terms) as if
it were a Lender in respect of its making such Eurodollar Loan and shall be
entitled to the indemnities and similar provisions, and shall be subject to the
limitations and requirements of such indemnities and similar provisions,
contained in Section 2.17.

(c) At the commencement of each Interest Period for any Eurodollar Revolving
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of $1,000,000 and not less than $5,000,000. ABR Revolving Borrowings
may be in any amount. Borrowings of more than one Type and Class may be
outstanding at the same time; provided that there shall not at any time be more
than a total of ten (10) Eurodollar Borrowings outstanding.

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

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

(i) the name of the applicable Borrower;

 

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

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

(iv) whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
and

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

If no election as to the Type of Revolving Borrowing is specified, then the
requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period
is specified with respect to any requested Eurodollar Revolving Borrowing, then
the applicable Borrower(s) shall be deemed to have selected an Interest Period
of 30 days’ duration. Promptly following receipt of a Borrowing Request in
accordance with this Section, the Administrative Agent shall advise each Lender
of the details thereof and of the amount of such Lender’s Loan to be made as
part of the requested Borrowing.

SECTION 2.04 Protective Advances. (a) Subject to the limitations set forth
below, (i) the Administrative Agent is authorized by the Borrowers and the
Lenders, from time to time in the Administrative Agent’s sole discretion (but
shall have absolutely no obligation to), to make Loans to the Borrowers, on
behalf of all Lenders, which the Administrative Agent, in its Permitted
Discretion, deems necessary or desirable (A) to preserve or protect the
Collateral, or any portion thereof, (B) to enhance the likelihood of, or
maximize the amount of, repayment of the Loans and other Obligations or (C) to
pay any other amount chargeable to or required to be paid by the Borrowers
pursuant to the terms of this Agreement, including payments of reimbursable
expenses (including costs, fees, and expenses as described in Section 9.03) and
other sums payable under the Loan Documents and (ii) the Administrative Agent
may require the Lenders to honor requests for Loans when the aggregate Loans
exceed, or would exceed upon the funding of such Loans, the Borrowing Base
(“Overadvance”) and to forbear from requiring Borrowers to cure an Overadvance
(A) when no other Event of Default is known to the Administrative Agent, as long
as the Overadvance does not continue for more than 30 consecutive days (and no
Overadvance may exist for at least five consecutive days thereafter before
further Loans are required) and (B) regardless of whether an Event of Default
exists, if the Administrative Agent discovers an Overadvance not previously
known by it to exist, as long as from the date of such discovery the Overadvance
does not continue for more than 30 consecutive days (any of such Loans described
in this clause (a) are herein referred to as “Protective Advances”); provided
that, the aggregate amount of all Protective Advances (including Overadvances)
outstanding at any time shall not at any time exceed 10% of the Commitments and
the aggregate amount of all Overadvances may not exceed 7.5% of the Borrowing
Base; provided further that, the aggregate amount of outstanding Protective
Advances plus the aggregate Revolving Exposure of all Lenders shall not exceed
the Commitments. Protective Advances may be made or permitted to exist even if
the conditions precedent set forth in Section 4.02 have not been satisfied. The
Protective Advances shall be secured by the Liens in favor of the Administrative
Agent in and to the Collateral and shall constitute Obligations hereunder. All
Protective Advances shall be ABR Borrowings. The Administrative Agent’s
authorization to make Protective Advances may be revoked at any time by the
Required Lenders. Any such revocation must be in writing and shall become
effective prospectively upon the Administrative Agent’s receipt thereof. At any
time that there is sufficient Availability and the conditions precedent set
forth in Section 4.02 have been satisfied, the Administrative Agent may request
the Revolving Lenders to make a Revolving Loan to repay a Protective Advance. At
any other time the Administrative Agent may require the Lenders to fund their
risk participations described in Section 2.04(b). Any funding of a Protective
Advance or sufferance of an Overadvance shall not constitute a waiver by the
Administrative Agent or Lenders of any Event of Default.

 

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(b) Upon the making of a Protective Advance by the Administrative Agent (whether
before or after the occurrence of a Default), each Lender shall be deemed,
without further action by any party hereto, to have unconditionally and
irrevocably purchased from the Administrative Agent without recourse or
warranty, an undivided interest and participation in such Protective Advance in
proportion to its Applicable Percentage. From and after the date, if any, on
which any Lender is required to fund its participation in any Protective Advance
purchased hereunder, the Administrative Agent shall promptly distribute to such
Lender, such Lender’s Applicable Percentage of all payments of principal and
interest and all proceeds of Collateral received by the Administrative Agent in
respect of such Protective Advance. In no event shall any Borrower or other Loan
Party be deemed a beneficiary of this Section nor authorized to enforce any of
its terms.

SECTION 2.05 Swingline Loans.

(a) The Administrative Agent, the Swingline Lender and the Revolving Lenders
agree that in order to facilitate the administration of this Agreement and the
other Loan Documents, promptly after the Borrower Representative requests an ABR
Borrowing, the Swingline Lender may elect to have the terms of this
Section 2.05(a) apply to such Borrowing Request by advancing, on behalf of the
Revolving Lenders and in the amount requested, same day funds to the Borrowers
on the applicable Borrowing date to the Funding Account(s) (each such Loan made
solely by the Swingline Lender pursuant to this Section 2.05(a) is referred to
in this Agreement as a “Swingline Loan”), with settlement among them as to the
Swingline Loans to take place on a periodic basis as set forth in
Section 2.05(c). Each Swingline Loan shall be subject to all the terms and
conditions applicable to other ABR Loans funded by the Revolving Lenders, except
that all payments thereon shall be payable to the Swingline Lender solely for
its own account. In addition, during any Dominion Trigger Period, the Borrowers
hereby authorize the Swingline Lender to, and the Swingline Lender shall,
subject to the terms and conditions set forth herein (but without any further
written notice required), not later than 1:00 p.m., Atlanta time, on each
Business Day, make available to the Borrowers by means of a credit to the
Funding Account(s), the proceeds of a Swingline Loan to the extent necessary to
pay items to be drawn on any Operating Account that day (as determined based on
notice from the Administrative Agent). The aggregate amount of Swingline Loans
outstanding at any time shall not exceed $30,000,000. The Swingline Lender shall
not make any Swingline Loan if the requested Swingline Loan exceeds Availability
(before giving effect to such Swingline Loan) or if the Required Lenders have
notified the Swingline Lender in writing that the conditions to a Borrowing in
Section 4.02 are not satisfied. All Swingline Loans shall be ABR Borrowings.

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

(c) The Administrative Agent, on behalf of the Swingline Lender, shall request
settlement (a “Settlement”) with the Revolving Lenders on at least a weekly
basis or on any date that the Administrative Agent elects, by notifying the
Revolving Lenders of such requested Settlement by facsimile,

 

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telephone, or e-mail no later than 12:00 noon Atlanta time on the date of such
requested Settlement (the “Settlement Date”). Each Revolving Lender (other than
the Swingline Lender, in the case of the Swingline Loans) shall transfer the
amount of such Revolving Lender’s Applicable Percentage of the outstanding
principal amount of the applicable Loan with respect to which Settlement is
requested to the Administrative Agent, to such account of the Administrative
Agent as the Administrative Agent may designate, not later than 2:00 p.m.,
Atlanta time, on such Settlement Date. Settlements may occur during the
existence of a Default and whether or not the applicable conditions precedent
set forth in Section 4.02 have then been satisfied. Such amounts transferred to
the Administrative Agent shall be applied against the amounts of the Swingline
Lender’s Swingline Loans and, together with Swingline Lender’s Applicable
Percentage of such Swingline Loan, shall constitute Revolving Loans of such
Revolving Lenders, respectively. If any such amount is not transferred to the
Administrative Agent by any Revolving Lender on such Settlement Date, the
Swingline Lender shall be entitled to recover such amount on demand from such
Lender together with interest thereon as specified in Section 2.07.

SECTION 2.06 Letters of Credit. (a) General. Subject to the terms and conditions
set forth herein, the Borrower Representative may request the issuance of
Letters of Credit for its own account or for the account of another Borrower or
any wholly-owned Subsidiary of the Borrower Representative, in a form reasonably
acceptable to the Administrative Agent and the applicable Issuing Bank, at any
time and from time to time during the Availability Period. In the event of any
inconsistency between the terms and conditions of this Agreement and the terms
and conditions of any form of letter of credit application or other agreement
submitted by the Borrowers to, or entered into by the Borrowers with, any
Issuing Bank relating to any Letter of Credit, the terms and conditions of this
Agreement shall control.

(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), the Borrower Representative shall
hand deliver or facsimile (or transmit by electronic communication, if
arrangements for doing so have been approved by the applicable Issuing Bank) to
the applicable Issuing Bank and the Administrative Agent (reasonably in advance
of the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, and specifying the date of issuance,
amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with paragraph
(c) of this Section), the amount of such Letter of Credit, the name and address
of the beneficiary thereof and such other information as shall be necessary to
prepare, amend, renew or extend such Letter of Credit. If requested by the
applicable Issuing Bank, the applicable Borrower also shall submit a letter of
credit application on such Issuing Bank’s standard form in connection with any
request for a Letter of Credit. A Letter of Credit shall be issued, amended,
renewed or extended only if (and upon issuance, amendment, renewal or extension
of each Letter of Credit the Borrowers shall be deemed to represent and warrant
that), after giving effect to such issuance, amendment, renewal or extension
(i) the LC Exposure shall not exceed $45,000,000 and (iv) the Aggregate Credit
Exposure shall not exceed the lesser of (x) the Commitments and (y) the
Borrowing Base. An Issuing Bank shall not issue (or increase, extend or renew) a
Letter of Credit if the Required Lenders have notified such Issuing Bank in
writing that the conditions therefor in Section 4.02 are not satisfied.

(c) Expiration Date. Each Letter of Credit shall expire at or prior to the close
of business on the earlier of (i) the date one year after the date of the
issuance of such Letter of Credit (or, in the case of any renewal or extension
thereof, one year after such renewal or extension) and (ii) the date that is
five Business Days prior to the Maturity Date; provided that any standby Letter
of Credit may contain customary automatic renewal provisions agreed upon by the
applicable Borrower and the applicable Issuing Bank pursuant to which the
expiration date is automatically extended by a specific time period (but not to
a date later than the date set forth in clause (ii) above).

 

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

(e) Reimbursement. If an Issuing Bank shall make any LC Disbursement in respect
of a Letter of Credit, the Borrowers shall reimburse such LC Disbursement by
paying to the Administrative Agent an amount equal to such LC Disbursement not
later than 11:00 a.m., Atlanta time, on the date that such LC Disbursement is
made, if the Borrower Representative shall have received notice of such LC
Disbursement prior to 9:00 a.m., Atlanta time, on such date, or, if such notice
has not been received by the Borrower Representative prior to such time on such
date, then not later than 11:00 a.m., Atlanta time, on the Business Day
immediately following the day that the Borrower Representative receives such
notice, if such notice is not received prior to such time on the day of receipt;
provided that the Borrowers may, subject to the conditions to borrowing set
forth herein, request in accordance with Section 2.03 or 2.05 that such payment
be financed with an ABR Revolving Borrowing or Swingline Loan in an equivalent
amount and, to the extent so financed, the Borrowers’ obligation to make such
payment shall be discharged and replaced by the resulting ABR Revolving
Borrowing or Swingline Loan. If the Borrowers fail to make such payment when
due, the Administrative Agent shall notify each Revolving Lender of the
applicable LC Disbursement, the payment then due from the Borrowers in respect
thereof and such Lender’s Applicable Percentage thereof. Promptly following
receipt of such notice, each Revolving Lender shall pay to the Administrative
Agent its Applicable Percentage of the payment then due from the Borrowers, in
the same manner as provided in Section 2.07 with respect to Loans made by such
Lender (and Section 2.07 shall apply, mutatis mutandis, to the payment
obligations of the Revolving Lenders), and the Administrative Agent shall
promptly pay to the applicable Issuing Bank the amounts so received by it from
the Revolving Lenders. Promptly following receipt by the Administrative Agent of
any payment from the Borrowers pursuant to this paragraph, the Administrative
Agent shall distribute such payment to the applicable Issuing Bank or, to the
extent that Revolving Lenders have made payments pursuant to this paragraph to
reimburse such applicable Issuing Bank, then to such Lenders and the applicable
Issuing Bank as their interests may appear. Any payment made by a Revolving
Lender pursuant to this paragraph to reimburse the applicable Issuing Bank for
any LC Disbursement (other than the funding of ABR Revolving Loans or a
Swingline Loan as contemplated above) shall not constitute a Loan and shall not
relieve the Borrowers of their obligation to reimburse such LC Disbursement.

(f) Obligations Absolute. The Borrowers’ joint and several obligation to
reimburse LC Disbursements as provided in paragraph (e) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit or this Agreement, or any term or provision therein, (ii) any
draft or other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by an Issuing Bank under a Letter of
Credit against

 

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

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

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

(i) Issuing Banks. An Issuing Bank (other than BofA except to the extent that
BofA ceases to be a Lender) may resign at any time and any existing Lender may
become an Issuing Bank at any time, in each case by written agreement among the
Borrower Representative, the Administrative Agent, the retiring Issuing Bank or
additional Issuing Bank (as applicable). The Administrative Agent shall notify
the Revolving Lenders of any such additional Issuing Bank. At the time any such
resignation shall become effective, the Borrowers shall pay all unpaid fees
accrued for the account of the retiring Issuing Bank pursuant to
Section 2.12(b). From and after the effective date of any such addition of an
Issuing Bank, the

 

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additional Issuing Bank shall have all the rights and obligations of an Issuing
Bank under this Agreement with respect to Letters of Credit issued by it. After
the resignation of an Issuing Bank hereunder, the retiring Issuing Bank shall
remain a party hereto and shall continue to have all the rights and obligations
of an Issuing Bank under this Agreement with respect to Letters of Credit issued
by it prior to such resignation, but shall not be required to issue additional
Letters of Credit.

(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower Representative receives notice
from the Administrative Agent or the Required Lenders (or, if the maturity of
the Loans has been accelerated, Revolving Lenders with LC Exposure representing
greater than 50% of the total LC Exposure) demanding the deposit of cash
collateral pursuant to this paragraph, the Borrowers shall deposit in an account
with the Administrative Agent, in the name of the Administrative Agent and for
the benefit of the Revolving Lenders (the “LC Collateral Account”), an amount in
cash equal to 103% of the LC Exposure as of such date plus accrued and unpaid
interest thereon; provided that the obligation to deposit such cash collateral
shall become effective immediately, and such deposit shall become immediately
due and payable, without demand or other notice of any kind, upon the occurrence
of any Event of Default with respect to any Borrower described in clause (h) or
(i) of Section 7.01. Such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the Secured Obligations. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account and the Borrowers hereby grant
the Administrative Agent a security interest in the LC Collateral Account. Other
than any interest earned on the investment of such deposits, which investments
shall be made at the option and sole discretion of the Administrative Agent and
at the Borrowers’ risk and expense, such deposits shall not bear interest.
Interest or profits, if any, on such investments shall accumulate in such
account. Moneys in such account shall be applied by the Administrative Agent to
reimburse the applicable Issuing Bank for LC Disbursements for which it has not
been reimbursed and, to the extent not so applied, shall be held for the
satisfaction of the reimbursement obligations of the Borrowers for the LC
Exposure at such time or, if the maturity of the Loans has been accelerated (but
subject to the consent of Revolving Lenders with LC Exposure representing
greater than 50% of the total LC Exposure), be applied to satisfy other Secured
Obligations. If the Borrowers are required to provide an amount of cash
collateral hereunder as a result of the occurrence of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to the
Borrowers within three Business Days after all such Defaults have been cured or
waived.

(k) Existing Letters of Credit. On the Effective Date, (i) each Existing Letter
of Credit, to the extent outstanding, shall be automatically and without further
action by the parties thereto deemed converted into Letters of Credit issued
pursuant to this Section 2.06 at the request of the Borrower Representative and
subject to the provisions hereof as if such Existing Letters of Credit had been
issued on the Effective Date, (ii) such Letters of Credit shall each be included
in the calculation of “LC Exposure” and, to the extent applicable and without
duplication, in the definitions of “Commercial LC Exposure” and “Standby LC
Exposure” and (iii) all liabilities of the Borrowers and the other Loan Parties
with respect to such Existing Letters of Credit shall constitute Obligations. No
Existing Letter of Credit converted in accordance with this Section 2.06(k)
shall be amended, extended or renewed except in accordance with the terms
hereof. Notwithstanding the foregoing, the Borrowers shall not be required to
pay any additional issuance fees with respect to the issuance of the Existing
Letters of Credit solely as a result of such letter of credit being converted
into a Letter of Credit hereunder, it being understood that the fronting,
participation and other fees set forth in Section 2.12(b) shall otherwise apply
to such Existing Letters of Credit.

SECTION 2.07 Funding of Borrowings. (a) Each Lender shall make each Loan to be
made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 2:00 p.m., Atlanta time, to the account of the
Administrative Agent most recently designated by it for such purpose by notice
to the Lenders in an amount equal to such Lender’s Applicable Percentage;
provided that, Swingline Loans shall be made as provided in Section 2.05. The
Administrative Agent will make such Loans

 

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available to the Borrower Representative by promptly crediting the amounts so
received, in like funds, to the Funding Account(s); provided that ABR Revolving
Loans made to finance the reimbursement of (i) an LC Disbursement as provided in
Section 2.06(e) shall be remitted by the Administrative Agent to the applicable
Issuing Bank and (ii) a Protective Advance shall be retained by the
Administrative Agent.

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

SECTION 2.08 Interest Elections. (a) Each Revolving Borrowing initially shall be
of the Type specified in the applicable Borrowing Request and, in the case of a
Eurodollar Revolving Borrowing, shall have an initial Interest Period as
specified in such Borrowing Request. Thereafter, the Borrower Representative may
elect to convert such Borrowing to a different Type or to continue such
Borrowing and, in the case of a Eurodollar Revolving Borrowing, may elect
Interest Periods therefor, all as provided in this Section. The Borrower
Representative may elect different options with respect to different portions of
the affected Borrowing, in which case each such portion shall be allocated
ratably among the Lenders holding the Loans comprising such Borrowing, and the
Loans comprising each such portion shall be considered a separate Borrowing.
This Section shall not apply to Swingline Loans or Protective Advances, which
may not be converted or continued.

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

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

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

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

 

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

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

If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrowers shall be deemed to have
selected an Interest Period of 30 days’ duration.

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

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

SECTION 2.09 Termination and Reduction of Commitments; Increase in Commitments.
(a) Unless previously terminated, the Commitments shall terminate on the
Maturity Date.

(b) The Borrowers may at any time terminate the Commitments upon (i) the payment
in full of all outstanding Loans, together with accrued and unpaid interest
thereon and on any Letters of Credit, (ii) the cancellation and return of all
outstanding Letters of Credit (or alternatively, with respect to each such
Letter of Credit, the furnishing to the Administrative Agent of a cash deposit
(or at the discretion of the Administrative Agent a back up standby letter of
credit satisfactory to the Administrative Agent) equal to 103% of the LC
Exposure as of such date), (iii) the payment in full of the accrued and unpaid
fees, and (iv) the payment in full of all reimbursable expenses and other
Obligations then due and owing together with accrued and unpaid interest
thereon.

(c) The Borrowers may from time to time reduce the Commitments; provided that
(i) each reduction of the Commitments shall be in an amount that is an integral
multiple of $5,000,000 and not less than $25,000,000 and (ii) the Borrowers
shall not reduce the Commitments if, after giving effect to any concurrent
prepayment of the Revolving Loans in accordance with Section 2.11, the Aggregate
Credit Exposure would exceed the lesser of the Commitments and the Borrowing
Base.

(d) The Borrower Representative shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) or (c) of
this Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Borrower Representative pursuant to this Section shall be irrevocable; provided
that a notice of termination of the Commitments delivered by the Borrower
Representative may state that such notice is conditioned upon the effectiveness
of other credit facilities or other specified conditions, in which case such
notice may be revoked by the Borrower Representative (by notice to the
Administrative Agent on or prior to the specified effective date) if such
condition or conditions

 

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are not satisfied. Any termination or reduction of the Commitments shall be
permanent. Each reduction of the Commitments shall be made ratably among the
Lenders in accordance with their respective Commitments.

(e) The Borrowers shall have the right to increase the Commitments by obtaining
additional Commitments, either from one or more of the Lenders or another
lending institution; provided that (i) any such request for an increase shall be
in a minimum amount of $25,000,000, (ii) the Borrower Representative, on behalf
of the Borrowers, shall have the right to increase the Commitments on no more
than four occasions, (iii) no existing Lender shall be obligated to provide any
portion of such increase (any decision to increase being in such Lender’s sole
discretion), (iv) the Administrative Agent and each Issuing Bank has approved
the identity of any such new Lender, such approval not to be unreasonably
withheld, (iv) any such new Lender assumes all of the rights and obligations of
a “Lender” hereunder, (v) any such additional Commitments shall be on the same
terms and conditions as the other existing Commitments (except as to fees agreed
to among the Administrative Agent, the Borrowers and the Lenders providing such
additional Commitments), (vi) the procedure described in Section 2.09(f) has
been satisfied, (vii) such increase is permitted by the Term Loan Documents and
the Holdings Notes Documents assuming that the increased Commitments are fully
drawn (and, if such increase is permitted under the Term Loan Documents or the
Holdings Notes Documents pursuant to a “borrowing base” calculation thereunder
rather than a dollar or ratio based basket, (A) the Administrative Agent may
require delivery of periodic certificates calculating such borrowing base under
the Term Loan Documents and/or the Holdings Notes Documents and (B) the
Borrowing Base under this Agreement may not exceed suchthe lowest applicable
borrowing base under the Term Loan Documents and the Holdings Notes Documents),
(viii) no Default or Event of Default shall exist at the time of and after
giving effect to any such increase, and (ix) Borrowers shall pay all fees and
expenses incurred in connection with such increase (including any breakage
costs).

(f) Any amendment hereto for such an increase or addition shall be in form and
substance reasonably satisfactory to the Administrative Agent and shall only
require the written signatures of the Administrative Agent, the Borrowers and
the Lender(s) being added or increasing their Commitment, subject only to the
approval of Required Lenders if any such increase would cause the Commitments to
exceed $375,000,000. As a condition precedent to such an increase, the Borrower
Representative shall deliver to the Administrative Agent (i) a certificate of
each Loan Party signed by an authorized 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 III and the other Loan
Documents are true and correct in all material respects 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 (2) no Default exists and (ii) such legal opinions and other
documents as may be reasonably requested by the Administrative Agent.

(g) Within a reasonable time after the effective date of any increase, the
Administrative Agent shall, and is hereby authorized and directed to, revise the
Commitment Schedule to reflect such increase and shall distribute such revised
Commitment Schedule to each of the Lenders and the Borrowers, whereupon such
revised Commitment Schedule shall replace the old Commitment Schedule and become
part of this Agreement. On the Business Day following any such increase, all
outstanding ABR Borrowings shall be reallocated among the Lenders (including any
newly added Lenders) in accordance with the Lenders’ respective revised
Applicable Percentages. Eurodollar Advances shall not be reallocated among the
Lenders prior to the expiration of the applicable Interest Period in effect at
the time of any such increase. All Availability dollar thresholds will be
automatically adjusted ratably in accordance with any increase of the
Commitments pursuant to this Section 2.09.

 

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SECTION 2.10 Repayment of Loans; Evidence of Debt. (a) The Borrowers hereby
jointly, severally and unconditionally promise to pay (i) to the Administrative
Agent for the account of each Lender the then unpaid principal amount of each
Loan on the Maturity Date, and (ii) to the Administrative Agent the then unpaid
amount of each Protective Advance on the earlier of the Maturity Date and demand
by the Administrative Agent.

(b) At all times that a Dominion Trigger Period is in effect, on each Business
Day, the Administrative Agent shall apply all funds deposited in the Collateral
Deposit Accounts on such Business Day or the immediately preceding Business Day
(at the discretion of the Administrative Agent, whether or not immediately
available) first to prepay any Protective Advances that may be outstanding, pro
rata, second to prepay the Loans (including Swingline Loans) pro rata and third
to cash collateralize outstanding LC Exposure.

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

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

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

(f) Any Lender may request that Loans made by it be evidenced by a promissory
note. In such event, the Borrowers shall prepare, execute and deliver to such
Lender a promissory note payable to such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) and in a form approved by the
Administrative Agent. Thereafter, the Loans evidenced by such promissory note
and interest thereon shall at all times (including after assignment pursuant to
Section 9.04) be represented by one or more promissory notes in such form
payable to the payee named therein (or, if such promissory note is a registered
note, to such payee and its registered assigns).

SECTION 2.11 Prepayment of Loans. (a) The Borrowers shall have the right at any
time and from time to time to prepay any Borrowing in whole or in part, subject
to prior notice in accordance with paragraph (d) of this Section.

(b) In the event and on such occasion that the Aggregate Credit Exposure exceeds
the lesser of (A) the Commitments or (B) the Borrowing Base, the Borrowers shall
prepay the Revolving Loans, LC Exposure and/or Swingline Loans in an aggregate
amount equal to such excess.

(c) During a Dominion Trigger Period, in the event and on each occasion that any
Net Proceeds are received by or on behalf of any Loan Party in respect of a
disposition or a casualty or condemnation event relating to Collateral included
in the Borrowing Base, the Borrowers shall, within one Business Day after such
Net Proceeds are received, prepay the Obligations in an amount equal to 100% of
such Net Proceeds. A prepayment pursuant to this clause (c) shall be applied
first to repay any Protective Advances that may be outstanding, pro rata, second
to repay the Loans (including Swingline Loans) pro rata and third to cash
collateral outstanding LC Exposure.

 

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

SECTION 2.12 Fees. (a) The Borrowers agree to pay to the Administrative Agent
for the account of the Revolving Lenders a commitment fee, which shall accrue at
the Applicable Commitment Fee Rate on the average daily amount of the Available
Commitment during the period from and including the Effective Date to but
excluding the date on which the Revolving Lenders’ Commitments terminate.
Accrued commitment fees shall be payable quarterly in arrears on the first day
of January, April, July and October and on the date on which the Commitments
terminate, commencing on the first such date to occur after the date hereof. All
commitment fees shall be computed on the basis of a year of 360 days and shall
be payable for the actual number of days elapsed.

(b) The Borrowers agree to pay (i) to the Administrative Agent for the account
of each Revolving Lender a participation fee with respect to its participations
in Letters of Credit, which shall accrue at the same Applicable Rate used to
determine the interest rate applicable to Eurodollar Revolving Loans on the
average daily amount of such Lender’s LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the date on which
such Lender’s Commitment terminates and the date on which such Revolving Lender
ceases to have any LC Exposure, and (ii) to the applicable Issuing Bank a
fronting fee, which shall accrue at the rate of 0.125% per annum on the average
daily amount of the LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date of termination of the
Commitments and the date on which there ceases to be any LC Exposure, as well as
the applicable Issuing Bank’s standard fees with respect to the issuance,
amendment, renewal or extension of any Letter of Credit or processing of
drawings thereunder. Participation fees and fronting fees accrued through and
including the last day of each calendar quarter shall be payable on the first
day of each calendar quarter following such last day, commencing on the first
such date to occur after the Effective Date; provided that all such fees shall
be payable on the date on which the Commitments terminate and any such fees
accruing after the date on which the Commitments terminate shall be payable on
demand. Any other fees payable to any Issuing Bank pursuant to this paragraph
shall be payable within 10 days after demand. All participation fees and
fronting fees shall be computed on the basis of a year of 360 days and shall be
payable for the actual number of days elapsed.

 

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(c) The Borrowers agree to pay to the Administrative Agent, for its own account,
fees payable in the amounts and at the times separately agreed upon between the
Borrowers and the Administrative Agent.

(d) All fees payable hereunder shall be paid on the dates due, in immediately
available funds, to the Administrative Agent (or to the applicable Issuing Bank,
in the case of fees payable to it) for distribution, in the case of commitment
fees and participation fees, to the Lenders. Fees paid shall not be refundable
under any circumstances.

SECTION 2.13 Interest. (a) The Loans comprising each ABR Borrowing (including
each Swingline Loan) shall bear interest at the Alternate Base Rate plus the
Applicable Rate.

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

(c) Each Protective Advance shall bear interest at the Alternate Base Rate plus
the Applicable Rate for Revolving Loans plus 2%.

(d) Notwithstanding the foregoing, if any principal of or interest on any Loan
or any fee or other amount payable by the Borrowers hereunder is not paid when
due, whether at stated maturity, upon acceleration or otherwise, the
Administrative Agent or the Required Lenders may, at their option, by notice to
the Borrower Representative (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 9.02 requiring the
consent of “each Lender affected thereby” for reductions in interest rates),
declare that (i) all overdue principal of the Loans shall bear interest at 2%
plus the rate otherwise applicable to such Loans as provided in the preceding
paragraphs of this Section or (ii) in the case of any other amount outstanding
hereunder, such amount shall accrue at 2% plus the rate applicable to such fee
or other obligation as provided hereunder.

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

(f) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the Alternate Base Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed. The Alternate
Base Rate or LIBOR, as applicable, shall be determined by the Administrative
Agent, and such determination shall be conclusive absent manifest error. If, for
any reason (including inaccurate reporting on financial statements, a Borrowing
Base Certificate or a Compliance Certificate), it is determined that a higher
Applicable Rate should have applied to a period than was actually applied, then
the proper rate shall be applied retroactively and the Borrowers shall
immediately pay an amount equal to the difference between the amount of interest
and fees that would have accrued using the proper rate and the amount actually
paid.

 

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

(a) the Administrative Agent determines (which determination shall be conclusive
absent manifest error) that adequate and reasonable means do not exist for
ascertaining LIBOR for such Interest Period; or

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

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

SECTION 2.15 Increased Costs. (a) 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 LIBOR) or any Issuing Bank;

(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes,
(B) Excluded Taxes described in clauses (b) through (d) of the definition
thereof and (C) Connection Taxes that are imposed on or measured by net income
(however denominated) or that are franchise taxes or branch profits taxes) that
are imposed on or measured by such Recipient’s loans, loan principal, letters of
credit, commitments, or other obligations, or its deposits, reserves, other
liabilities or capital attributable thereto; or

(iii) impose on any Lender or any Issuing Bank or the London interbank market
any other condition, cost or expense (other than Taxes) affecting this Agreement
or 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 the
Administrative Agent, such Lender or such Issuing Bank of making, converting to,
continuing or maintaining (A) in the case of clauses (i) and (iii), any
Eurodollar Loan or any Alternate Base Rate Loan determined by reference to LIBOR
and (B) in the case of clause (ii), any Loan, or of maintaining its obligation
to make any such Loan, or to increase the cost to the Administrative Agent, such
Lender or such Issuing Bank of participating in, issuing or maintaining any
Letter of Credit (or of maintaining its obligation to participate in or to issue
any Letter of Credit), or to reduce the amount of any sum received or receivable
by the Administrative Agent, such Lender or such Issuing Bank (whether of
principal, interest or any other amount) then, upon request of the
Administrative Agent, such Lender or such Issuing Bank, the Borrowers will pay
to such Person such additional amount or amounts as will compensate such Person
for such additional costs incurred or reduction suffered.

(b) If any Lender or any Issuing Bank determines that any Change in Law
regarding capital or liquidity requirements has or would have the effect of
reducing the rate of return on such Lender’s or such Issuing Bank’s capital or
on the capital of such Lender’s or such Issuing Bank’s holding company, if any,
as a consequence of this Agreement or the Loans made by, or participations in
Letters of Credit or

 

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Swingline Loans held by, such Lender, or the Letters of Credit issued by such
Issuing Bank, to a level below that which such Lender or such Issuing Bank or
such Lender’s or such Issuing Bank’s holding company could have achieved but for
such Change in Law (taking into consideration such Lender’s or such Issuing
Bank’s policies and the policies of such Lender’s or such Issuing Bank’s holding
company with respect to capital adequacy), then from time to time the Borrowers
will pay to such Lender or such Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or such Issuing Bank
or such Lender’s or such Issuing Bank’s holding company for any such reduction
suffered.

(c) A certificate of a Lender or an Issuing Bank setting forth the amount
necessary to compensate such Lender or such Issuing Bank or its holding company,
as the case may be, as specified in paragraph (a) or (b) of this Section,
together with a reasonably detailed calculation thereof and the assumptions upon
which such calculation was based, shall be delivered to the Borrower
Representative and shall be conclusive absent manifest error. The Borrowers
shall pay such Lender or such Issuing Bank, as the case may be, the amount shown
as due on any such certificate within 10 days after receipt thereof.

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

SECTION 2.16 Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default),
(b) the conversion of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under
Section 2.09(d) and is revoked in accordance therewith), or (d) the assignment
of any Eurodollar Loan other than on the last day of the Interest Period
applicable thereto as a result of a request by the Borrower Representative
pursuant to Section 2.19, then, in any such event, the Borrowers shall
compensate each Lender for the loss, cost and expense attributable to such event
(which shall not include any lost profit or margin). In the case of a Eurodollar
Loan, such loss, cost or expense to any Lender shall be deemed to include an
amount determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at LIBOR that would have been applicable to such Loan, for
the period from the date of such event to the last day of the then current
Interest Period therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such
Loan), over (ii) the amount of interest which would accrue on such principal
amount for such period at the interest rate which such Lender would bid were it
to bid, at the commencement of such period, for dollar deposits of a comparable
amount and period from other banks in the eurodollar market. A certificate of
any Lender setting forth any amount or amounts that such Lender is entitled to
receive pursuant to this Section shall be delivered to the Borrower
Representative and shall be conclusive absent manifest error. The Borrowers
shall pay such Lender the amount shown as due on any such certificate within 10
Business Days after receipt thereof.

SECTION 2.17 Taxes. (a) Any and all payments by or on account of any obligation
of the Borrowers hereunder shall be made free and clear of and without deduction
or withholding for any Taxes except as required by Requirement of Law. If any
Requirement of Law (as determined in the good faith discretion of an applicable
Withholding Agent) requires the deduction or withholding of any Tax from such

 

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payment by a Withholding Agent, then the applicable Withholding Agent shall be
entitled to make such deduction or withholding and shall timely pay the full
amount deducted or withheld to the relevant Governmental Authority in accordance
with applicable law and, if such Tax is an Indemnified Tax or Other Tax, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions or withholdings (including deductions or withholdings
applicable to additional sums payable under this Section) the Administrative
Agent, Lender or an Issuing Bank (as the case may be) receives an amount equal
to the sum it would have received had no such deductions or withholdings been
made.

(b) Without duplication, in addition, the Borrowers shall pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law, or at the
option of the Administrative Agent timely reimburse it for the payment of, any
Other Taxes.

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

(d) Each Lender and each Issuing Bank shall indemnify the Borrowers and the
Administrative Agent, within 10 days after written demand therefor, against any
and all Taxes and any and all related losses, claims, liabilities and reasonable
expenses (including the fees, charges and disbursements of any counsel for the
Borrowers or the Administrative Agent and including Taxes imposed or asserted on
or attributable to amounts payable under this Section 2.17(d)) incurred by or
asserted against the Borrowers or the Administrative Agent by any Governmental
Authority as a result of the failure by such Lender or such Issuing Bank, as the
case may be, to deliver, or as a result of the inaccuracy, inadequacy or
deficiency of, any documentation required to be delivered to the Borrowers or
the Administrative Agent pursuant to Section 2.17(f). Each Lender and each
Issuing Bank hereby authorizes the Administrative Agent to set off and apply any
and all amounts at any time owing to such Lender or such Issuing Bank, as the
case may be, under this Agreement or any other Loan Document against any amount
due to the Administrative Agent under this Section 2.17(d).

(e) As soon as practicable after any payment of Indemnified Taxes or Other Taxes
by the Borrowers to a Governmental Authority, the Borrower Representative 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.

(f) Forms.

(i) Any Lender that is a United States person (within the meaning of
Section 7701(a)(30) of the Code) shall deliver to the Borrowers and the
Administrative Agent on or prior to the date on which such Lender becomes a
party to this Agreement (and from time to time thereafter upon the reasonable
request of the Borrowers or the Administrative Agent), executed originals of
U.S. Internal Revenue Service Form W-9 certifying that such Lender is exempt
from U.S. federal backup withholding Tax.

 

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(ii) Each Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrowers and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) on or before the date it becomes a party to this Agreement (or, in
the case of any Participant, on or before the date such Participant purchases
the related participation), which ever of the following is applicable:

(1) in the case of a Foreign Lender claiming the benefits of an income tax
treaty to which the United States is a party (x) with respect to payments of
interest under any Loan Document, executed originals of IRS Form W-8BEN
establishing an exemption from, or reduction of, U.S. federal withholding Tax
pursuant to the “interest” article of such tax treaty and (y) with respect to
any other applicable payments under any Loan Document, IRS Form W-8BEN
establishing an exemption from, or reduction of, U.S. federal withholding Tax
pursuant to the “business profits” or “other income” article of such tax treaty;

(2) executed originals of IRS Form W-8ECI;

(3) 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
substantially in the form of Exhibit G-1 to the effect that such Foreign Lender
is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10
percent shareholder” of the Borrowers within the meaning of Section 881(c)(3)(B)
of the Code, or a “controlled foreign corporation” described in
Section 881(c)(3)(C) of the Code (a “U.S. Tax Certificate”) and (y) executed
originals of IRS Form W-8BEN; and

(4) to the extent a Foreign Lender is not the beneficial owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, a
U.S. Tax Compliance Certificate substantially in the form of Exhibit G-2 or
Exhibit G-3, IRS Form W-9, and/or other certification documents from each
beneficial owner, as applicable; provided that if the Foreign Lender is a
partnership and one or more direct or indirect partners of such Foreign Lender
are claiming the portfolio interest exemption, such Foreign Lender may provide a
U.S. Tax Certificate substantially in the form of Exhibit G-4 on behalf of each
such direct and indirect partner.

In addition, upon request of the Borrowers, each Foreign Lender shall deliver
such forms promptly upon the obsolescence, expiration, or invalidity of any form
previously delivered by such Foreign Lender. Each Foreign Lender shall promptly
notify the Borrowers at any time it determines that it is no longer in a
position to provide any previously delivered certificate to the Borrowers (or
any other form of certification adopted by the U.S. taxing authorities for such
purpose).

(iii) Any Lender that is entitled to an exemption from or reduction of non-U.S.
withholding tax under the law of the jurisdiction in which the applicable
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law or reasonably requested by the Borrower, such properly completed and
executed documentation

 

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prescribed by applicable law or reasonably requested by the Borrower as will
permit such payments to be made without withholding or at a reduced rate;
provided, the completion, execution and submission of such documentation shall
not be required if in the Lender’s reasonable judgment such completion,
execution or submission would subject such Lender to any material unreimbursed
cost or expense or would materially prejudice the legal or commercial position
of such Lender.

(iv) If a payment made to a Lender under any Loan Document would be subject to
U.S. Federal withholding Tax imposed by FATCA if such Lender fails to comply
with the applicable reporting requirements of FATCA (including those contained
in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall
deliver to the Borrowers and the Administrative Agent at the time or times
prescribed by law and at such time or times reasonably requested by the Borrower
or the Administrative Agent such documentation prescribed by applicable law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrower or the
Administrative Agent as may be necessary for the Borrower and the Administrative
Agent to comply with their obligations under FATCA and to determine that such
Lender has complied with such Lender’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment. Solely for purposes of this
clause (iv), “FATCA” shall include any amendments made to FATCA after the date
of this Agreement.

(g) If the Administrative Agent or a Lender determines, in its sole discretion,
that it has received a refund of Indemnified 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 2.17, it shall promptly
pay over such refund to the Borrowers (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrowers under this
Section 2.17 with respect to the Indemnified Taxes or Other Taxes giving rise to
such refund), net of all out-of-pocket expenses of the Administrative Agent or
such Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided, that the
Borrowers, upon the request of the Administrative Agent or such Lender, agrees
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 or such Lender in the event the Administrative Agent or
such Lender is required to repay such refund to such Governmental Authority.
Notwithstanding anything to the contrary in this Section 2.17(g), in no event
will the Administrative Agent or any Lender be required to pay any amount to any
Borrower pursuant to this Section 2.17(g) the payment of which would place such
Administrative Agent or Lender in a less favorable net after-Tax position than
the Administrative Agent or Lender would have been in if the indemnification
payments or additional amounts with respect to such Tax had never been paid.
This Section 2.17(g) shall not be construed to require the Administrative Agent
or any Lender to make available its tax returns (or any other information
relating to its taxes which it deems confidential) to the Borrowers or any other
Person.

(h) For purposes of Section 2.17, the term “Lender” includes any Issuing Bank
and the term “Requirement of Law” includes FATCA.

SECTION 2.18 Payments Generally; Allocation of Proceeds; Sharing of Set-offs.
(a) The Borrowers shall make each payment required to be made by them hereunder
(whether of principal, interest, fees or reimbursement of LC Disbursements, or
of amounts payable under Section 2.15, 2.16 or 2.17, or otherwise) prior to 2:00
p.m., Atlanta time, on the date when due, in immediately available funds,
without set-off or counterclaim. Any amounts received after such time on any
date may, in the discretion of the Administrative Agent, be deemed to have been
received on the next succeeding Business Day for purposes of calculating
interest thereon. All such payments shall be made to the Administrative Agent at
its offices at

 

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300 Galleria Parkway, Suite 800, Atlanta, Georgia, except payments to be made
directly to an Issuing Bank or Swingline Lender as expressly provided herein and
except that payments pursuant to Sections 2.15, 2.16, 2.17 and 9.03 shall be
made directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for the account of any other Person
to the appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension. All payments hereunder shall be made in dollars.

(b) Any proceeds of Collateral received by the Administrative Agent (i) not
constituting any of (A) a specific payment of principal, interest, fees or other
sum payable under the Loan Documents (which shall be applied as specified by the
Borrowers), (B) a mandatory prepayment (which shall be applied in accordance
with Section 2.11) or (C) amounts to be applied from the Collateral Deposit
Accounts when full cash dominion is in effect (which shall be applied in
accordance with Section 2.10(b)) or (ii) after an Event of Default has occurred
and is continuing and the Administrative Agent so elects or the Required Lenders
so direct, such funds shall be applied ratably first, to pay any fees,
indemnities, or expense reimbursements including amounts then due to the
Administrative Agent and the applicable Issuing Banks from the Borrowers (other
than in connection with Banking Services Obligations or Swap Obligations),
second, to pay any fees, indemnities or expense reimbursements then due to the
Lenders from the Borrowers (other than in connection with Banking Services
Obligations or Swap Obligations), third, to pay interest due in respect of
Protective Advances, fourth, to pay the principal of Protective Advances, fifth,
to pay interest then due and payable on the Loans (other than Protective
Advances) ratably, sixth, to prepay principal on the Loans (other than
Protective Advances) and unreimbursed LC Disbursements ratably, seventh, to pay
an amount to the Administrative Agent equal to one hundred three percent
(103%) of the aggregate undrawn face amount of all outstanding Letters of Credit
and the aggregate amount of any unpaid LC Disbursements, to be held as cash
collateral for such Obligations, eighth, to payment of any amounts owing with
respect to Banking Services Obligations and with respect to Swap Obligations
owed to Lenders, Lead Arrangers or their respective Affiliates, ninth, to
payment of any amounts owing with respect to Swap Obligations owed to Persons
that were Lenders or Lead Arrangers at the time of entry into such Swap
Obligations but which are no longer Lenders or Lead Arrangers at the time of
such payment, or their Affiliates and tenth, to the payment of any other Secured
Obligation due to the Administrative Agent or any Secured Party by the
Borrowers. Notwithstanding anything to the contrary contained in this Agreement,
unless so directed by the Borrower Representative, or unless a Default is in
existence, neither the Administrative Agent nor any Lender shall apply any
payment which it receives to any Eurodollar Loan, except (a) on the expiration
date of the Interest Period applicable to any such Eurodollar Loan or (b) in the
event, and only to the extent, that there are no outstanding ABR Loans and, in
any such event, the Borrowers shall pay the break funding payment required in
accordance with Section 2.16. The Administrative Agent and the Lenders shall
have the continuing and exclusive right to apply and reverse and reapply any and
all such proceeds and payments to any portion of the Secured Obligations.

(c) At the election of the Administrative Agent, (i) all payments of principal,
interest, LC Disbursements, fees, premiums, reimbursable expenses (including,
without limitation, all reimbursement for fees and expenses pursuant to
Section 9.03), and other sums payable under the Loan Documents and (ii) all
payments of any check, ACH or electronic debit, or other payment item requested
by the Borrowers from any controlled disbursement account with the
Administrative Agent or any of its Affiliates at a time when there are
insufficient funds to cover such payment, may be paid from the proceeds of
Borrowings made hereunder whether made following a request by the Borrower
Representative pursuant to Section 2.03 or a deemed request as provided in this
Section or may be deducted from any deposit account of any Borrower maintained
with the Administrative Agent. Each Borrower hereby irrevocably authorizes
(i) the Administrative Agent to make a Borrowing for the purpose of paying each
payment of (A) principal, interest and fees as it becomes due hereunder or any
other amount due under the Loan Documents

 

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and (B) any check, ACH or electronic debit, or other payment item presented for
payment from any controlled disbursement account of any Borrower with the
Administrative Agent or any of its Affiliates at a time when there are
insufficient funds to cover such payment and in each case, agrees that all such
amounts charged shall constitute Loans (including Swingline Loans, but such a
Borrowing may only constitute a Protective Advance if it is to reimburse costs,
fees and expenses as described in Section 9.03) and that all such Borrowings
shall be deemed to have been requested pursuant to Sections 2.03, 2.04 or 2.05,
as applicable and (ii) the Administrative Agent to charge any deposit account of
any Borrower maintained with the Administrative Agent for each payment of
(A) principal, interest and fees as it becomes due hereunder or any other amount
due under the Loan Documents and (B) any check, ACH or electronic debit, or
other payment item presented for payment from any controlled disbursement
account of any Borrower with the Administrative Agent or any of its Affiliates
at a time when there are insufficient funds to cover such payment.

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

(e) Unless the Administrative Agent shall have received notice from the Borrower
Representative prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or any Issuing Bank
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 applicable Issuing Bank, 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 each applicable Issuing Bank, as the case may be, severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender or such Issuing Bank with interest thereon, for each
day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation.

(f) If any Lender shall fail to make any payment required to be made by it
hereunder, then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), (i) apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender’s
obligations hereunder until all such unsatisfied obligations are fully paid
and/or (ii) hold any such amounts in a segregated account as cash collateral
for, and apply any such amounts to, any future funding obligations of such
Lender hereunder; application of amounts pursuant to (i) and (ii) above shall be
made in such order as may be determined by the Administrative Agent in its
discretion.

 

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SECTION 2.19 Mitigation Obligations; Replacement of Lenders.

(a) If any Lender requests compensation under Section 2.15, or if the Borrowers
are required to pay any Indemnified Taxes (excluding Other Taxes) or additional
amounts to any Lender or any Governmental Authority for the account of any
Lender pursuant to Section 2.17, then such Lender shall use reasonable efforts
to designate a different lending office for funding or booking its Loans or
Letters of Credit 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 or to be withheld pursuant to Section 2.15 or 2.17, as the case may be,
in the future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrowers
hereby agree to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

(b) If any Lender requests compensation under Section 2.15, or if the Borrowers
are required to pay any Indemnified Taxes (excluding Other Taxes) or additional
amounts to any Lender or any Governmental Authority for the account of any
Lender pursuant to Section 2.17, or if any Lender becomes a Defaulting 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 Section 9.04), all its interests, rights and obligations under this Agreement
to an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) the Borrowers
shall have received the prior written consent of the Administrative Agent (and
if a Commitment is being assigned, each Issuing Bank), which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Loans and participations in LC
Disbursements and Swingline Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrowers (in
the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.15 or payments required
to be made pursuant to Section 2.17, such assignment will result in a reduction
in such compensation or payments. A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrowers to require
such assignment and delegation cease to apply.

SECTION 2.20 Defaulting Lenders. Notwithstanding any provision of this Agreement
to the contrary, if any Lender becomes a Defaulting Lender, then the following
provisions shall apply for so long as such Lender is a Defaulting Lender:

(a) fees shall cease to accrue on the unfunded portion of the Commitment of such
Defaulting Lender pursuant to Section 2.12(a);

(b) the Commitment and Credit Exposure of such Defaulting Lender shall not be
included in determining whether all Lenders, the Required Lenders or the
Supermajority Lenders have taken or may take any action hereunder (including any
consent to any amendment or waiver pursuant to Section 9.02), provided that
(i) any waiver, amendment or modification requiring the consent of all Lenders
or each affected Lender that by its terms affects such Defaulting Lender more
adversely than other affected Lenders shall require the consent of such
Defaulting Lender and (ii) any waiver, amendment or modification specified in
clauses (i), (ii) and (iii) of the first proviso in Section 9.02(b) affecting a
Defaulting Lender shall require the consent of such Defaulting Lender;

 

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(c) if any Swingline Exposure or LC Exposure exists at the time a Lender becomes
a Defaulting Lender then:

(i) all or any part of such Swingline Exposure and LC Exposure shall be
reallocated among the non-Defaulting Lenders in accordance with their respective
Applicable Percentages but only to the extent (x) the sum of all non-Defaulting
Lenders’ Credit Exposures and such Defaulting Lender’s Swingline Exposure and LC
Exposure does not exceed the total of all non-Defaulting Lenders’ Commitments,
(y) the conditions set forth in Section 4.02 are satisfied at such time and
(z) after giving effect thereto, no Lender’s Credit Exposure would exceed its
Commitment; and

(ii) if the reallocation described in clause (i) above cannot, or can only
partially, be effected, the Borrowers shall within one Business Day following
notice by the Administrative Agent (x) first, prepay such Defaulting Lender’s
Swingline Exposure and (y) second, cash collateralize such Defaulting Lender’s
LC Exposure (after giving effect to any partial reallocation pursuant to clause
(i) above) in accordance with the procedures set forth in Section 2.06(j) for so
long as such LC Exposure is outstanding;

(iii) if the Borrowers cash collateralize any portion of such Defaulting
Lender’s LC Exposure pursuant to Section 2.20(c), the Borrowers shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 2.12(b)
with respect to such Defaulting Lender’s LC Exposure during the period such
Defaulting Lender’s LC Exposure is cash collateralized;

(iv) if the LC Exposure of the non-Defaulting Lender is reallocated pursuant to
Section 2.20(c), then the fees payable to the Lenders pursuant to
Section 2.12(a) and Section 2.12(b) shall be adjusted in accordance with such
non-Defaulting Lenders’ Applicable Percentages; or

(v) if any Defaulting Lender’s LC Exposure is neither cash collateralized nor
reallocated pursuant to Section 2.20(c), then, without prejudice to any rights
or remedies of any Issuing Bank or any Lender hereunder, all facility fees that
otherwise would have been payable to such Defaulting Lender (solely with respect
to the portion of such Defaulting Lender’s Commitment that was utilized by such
LC Exposure) and Letter of Credit fees payable under Section 2.12(b) with
respect to such Defaulting Lender’s LC Exposure shall be payable to the
applicable Issuing Bank until such LC Exposure is cash collateralized and/or
reallocated;

(d) no Issuing Bank shall be required to issue, amend or increase any Letter of
Credit, unless it is satisfied that the related exposure will be 100% covered by
the Commitments of the non-Defaulting Lenders and/or cash collateral will be
provided by the Borrowers in accordance with Section 2.20(c), and participating
interests in any such newly issued or increased Letter of Credit or newly made
Swingline Loan shall be allocated among non-Defaulting Lenders in a manner
consistent with Section 2.20(c)(i) (and Defaulting Lenders shall not participate
therein); and

(e) in the event and on the date that each of the Administrative Agent, the
Borrowers, each Issuing Bank and the Swingline Lender agrees that a Defaulting
Lender has adequately remedied all matters that caused such Lender to be a
Defaulting Lender, then the Swingline Exposure and LC Exposure of the other
Lenders shall be readjusted to reflect the inclusion of such Lender’s Commitment
and on such date such Lender shall purchase at par such of the Loans of the
other Lenders (other than Swingline Loans) as the Administrative Agent shall
determine may be necessary in order for such Lender to hold such Loans in
accordance with its Applicable Percentage.

 

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SECTION 2.21 Returned Payments. If after receipt of any payment which is applied
to the payment of all or any part of the Obligations, the Administrative Agent
or any Lender is for any reason compelled to surrender such payment or proceeds
to any Person because such payment or application of proceeds is invalidated,
declared fraudulent, set aside, determined to be void or voidable as a
preference, impermissible setoff, or a diversion of trust funds, or for any
other reason, then the Obligations or part thereof intended to be satisfied
shall be revived and continued and this Agreement shall continue in full force
as if such payment or proceeds had not been received by the Administrative Agent
or such Lender. The provisions of this Section 2.21 shall be and remain
effective notwithstanding any contrary action which may have been taken by the
Administrative Agent or any Lender in reliance upon such payment or application
of proceeds. The provisions of this Section 2.21 shall survive the termination
of this Agreement.

SECTION 2.22 Limitation on Permitted Discretion.

(a) The Administrative Agent shall have the right to establish, modify or
eliminate Reserves against Eligible Accounts and Eligible Inventory from time to
time in its Permitted Discretion. In addition, the Administrative Agent reserves
the right, at any time and from time to time after the Effective Date, to adjust
any of the applicable criteria, to establish new criteria and to adjust advance
rates with respect to Eligible Accounts and Eligible Inventory, in its Permitted
Discretion, subject to Section 9.02.

(b) Notwithstanding the foregoing or any provision in this Agreement to the
contrary, circumstances, conditions, events or contingencies arising prior to
the Effective Date and disclosed to the Administrative Agent prior to the
Effective Date shall not be the basis for any establishment or modification of
Reserves, eligibility criteria or advance rates unless (i) in the case of
Reserves and eligibility criteria, such category of Reserves or eligibility
criteria were established on the Effective Date (which may include Reserves and
eligibility criteria set forth in the initial Borrowing Base Certificate) or
(ii) such circumstances, conditions, events or contingencies shall have changed
since the Effective Date (other than with respect to the Banking Services
Reserve or any reserve for Swap Obligations).

(c) Any exercise of Permitted Discretion with respect to Reserves (other than
with respect to the Banking Services Reserve or any reserve for Swap
Obligations) shall be based on a good faith reasonable determination of the
Administrative Agent that (i) the circumstances, conditions, events or
contingencies giving rise thereto will or reasonably could be expected to
adversely affect the value of the Eligible Accounts or Eligible Inventory in the
Borrowing Base, the enforceability or priority of the Administrative Agent’s
Liens thereon or the amount the Secured Parties would likely receive in the
liquidation of Eligible Accounts or Eligible Inventory in the Borrowing Base and
(ii) the proposed action to be taken by the Administrative Agent to mitigate the
effects described in clause (i) (including the amount of any Reserves) bears a
reasonable relationship to the circumstance, condition, event or other
contingency that is the basis therefor.

(d) Upon delivery of notice to the Borrower Representative by the Administrative
Agent of its intent to establish or increase Reserves, the Administrative Agent
shall be available to discuss the proposed Reserves or increase, and Borrowers
may take such action as may be required so that the circumstance, condition,
event or other contingency that is the basis for such Reserves or increase no
longer exists, in a manner and to the extent reasonably satisfactory to the
Administrative Agent in the exercise of its Permitted Discretion. In no event
shall such notice and opportunity limit the right of the Administrative Agent to
establish or change such Reserves, unless the Administrative Agent shall have
determined in its Permitted Discretion that the circumstance, condition, event
or other contingency that is the basis for such new Reserves or such change no
longer exists or has otherwise been adequately addressed by Borrowers.

(e) In the event that the event, condition or other matter giving rise to the
establishment of any Reserve shall cease to exist (unless the Administrative
Agent determines there is a reasonable prospect that such event, condition or
other matter will occur again within a reasonable period of time thereafter),
the Borrower Representative may request in writing that the Administrative Agent
discontinue the Reserve established pursuant to such event, condition or other
matter (and the Administrative Agent will have a reasonable period of time to
evaluate such request and will be available to discuss such request with the
Borrower Representative).

 

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

Each Loan Party represents and warrants to the Lenders on the Effective Date and
on each date a Loan is made or a Letter of Credit is issued, amended, renewed or
extended, that the following statements are true and correct in all material
respects; provided that any such representations and warranties that are
qualified as to “materiality” shall be true and correct in all respects;
provided further, that it is understood and agreed that the accuracy of the
following representations and warranties made on the Effective Date, other than
those specified in Section 4.01(s), shall not be a condition precedent to the
effectiveness of this Agreement or to the making of the initial Loans and the
issuance (or deemed issuance) of the initial Letters of Credit:

SECTION 3.01 Organization; Powers. Each of the Loan Parties and each of its
Restricted Subsidiaries is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, has all requisite power
and authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.

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

SECTION 3.03 Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except (i) such as have been obtained or
made and are in full force and effect, (ii) for filings necessary to perfect
Liens created pursuant to the Loan Documents, and (iii) such approvals,
authorizations or consents the failure of which to obtain or make could not
reasonably be expected to have a Material Adverse Effect, (b) will not violate
(i) the certificate or articles of incorporation or organization, by-laws,
operating, management or partnership agreement or other organizational documents
of any Loan Party or any of its Restricted Subsidiaries and (ii) any material
Requirement of Law applicable to any Loan Party or any of its Restricted
Subsidiaries, (c) will not violate or result in a default under the Company
Notes IndentureTerm Loan Agreement, the Holdings Notes Indenture or any other
material indenture, agreement or instrument binding upon any Loan Party or any
of its Restricted Subsidiaries or its assets, or give rise to a right thereunder
to require any payment to be made by any Loan Party or any of its Restricted
Subsidiaries, and

 

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(d) will not result in the creation or imposition of any Lien on any asset of
any Loan Party or any of its Restricted Subsidiaries, except Liens created
pursuant to the Loan Documents and Liens permitted under Section 6.02.

SECTION 3.04 Financial Condition; No Material Adverse Effect. (a) The Company
has heretofore furnished to the Lenders the consolidated balance sheet and
statements of income, stockholders equity and cash flows of Holdings (i) as of
and for the fiscal years ended December 25, 2009, December 31, 2010 and
December 30, 2011, reported on by Deloitte & Touche LLP, independent public
accountants, and (ii) as of and for (x) the fiscal quarter and the portion of
the fiscal year ended March 30, 2012, (y) the fiscal quarter and the portion of
the fiscal year ended June 29, 2012, and (z) if such date precedes the Effective
Date by at least 45 days, the fiscal quarter and the portion of the fiscal year
ended September 28, 2012, in each case certified by its chief financial officer.
Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of Holdings and its
consolidated Restricted Subsidiaries as of such dates and for such periods in
accordance with GAAP, subject to year-end audit adjustments and the absence of
footnotes in the case of the statements referred to in clause (ii) above.

(b) No event, change or condition has occurred that has had, or could reasonably
be expected to have, a Material Adverse Effect, since December 30, 2011.

SECTION 3.05 Properties. (a) As of the date of this Agreement, Schedule 3.05
sets forth the address of each parcel of real property that is owned or leased
by each Loan Party. Each of such leases and subleases is valid and enforceable
in accordance with its terms and is in full force and effect, and no default
(i) by any Loan Party to any such lease or sublease or (ii) to the knowledge of
the Loan Parties, by any other parties to any such lease or sublease exists,
except for defaults that could not reasonably be expected to have a Material
Adverse Effect. Each of the Loan Parties and its Restricted Subsidiaries has
good and indefeasible title to, or valid leasehold interests in, all its
material real and personal property, free of all Liens other than those
permitted by Section 6.02.

(b) Each Loan Party and its Restricted Subsidiaries owns, or is licensed to use,
all material trademarks, tradenames, copyrights, patents and other intellectual
property necessary to its business as currently conducted. A correct and
complete list of all trademark and patent registrations and filed applications
and all material copyright registrations and filed applications owned by each
Loan Party on the Effective Date is set forth on Schedule 3.05, and the use
thereof by the Loan Parties and its Restricted Subsidiaries does not infringe
upon the rights of any other Person, except as could not reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect. Except as
set forth on Schedule 3.05 hereof, the Loan Parties are not, as of the date of
this Agreement, bound by any material license agreement, licensing agreement or
similar arrangement as licensor pursuant to which they have licensed any rights
under any of their intellectual property to any Person other than Holdings and
its Restricted Subsidiaries.

SECTION 3.06 Litigation and Environmental Matters. (a) There are no actions,
suits or proceedings by or before any arbitrator or Governmental Authority
pending against or, to the knowledge of any Loan Party, threatened against or
affecting the Loan Parties or any of their Restricted Subsidiaries (i) as to
which there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters described in Part A of Schedule 3.06) or (ii) that involve this
Agreement or the Transactions (other than the Disclosed Matters described in
Part B of Schedule 3.06).

(b) Except for matters that individually, or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, (i) no Loan Party
nor any of its Restricted Subsidiaries has received notice of any claim with
respect to any Environmental Liability or knows of any basis for any

 

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Environmental Liability and (ii) no Loan Party nor any of its Restricted
Subsidiaries (1) has failed to comply with any Environmental Law or to obtain,
maintain or comply with any permit, license or other approval required under any
Environmental Law or (2) has become subject to any Environmental Liability.

(c) Since the date of this Agreement, there has been no change in the status of
the Disclosed Matters that, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.

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

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

SECTION 3.09 Taxes. Each Loan Party and its Restricted Subsidiaries has timely
filed or caused to be filed all federal, state and other material Tax returns
and reports required to have been filed and has paid or caused to be paid all
Taxes that are material in amount required to have been paid by it, except
(a) Taxes that are being contested in good faith by appropriate proceedings and
for which such Loan Party or such Restricted Subsidiary, as applicable, has set
aside on its books adequate reserves and (b) to the extent that the failure to
do so could not be expected to result in a Material Adverse Effect. No tax liens
(other than liens for current period Taxes not yet due and payable) have been
filed and no claims are being asserted with respect to any material amount of
such taxes.

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

SECTION 3.11 Disclosure. Each Borrower and Holdings have disclosed to the
Lenders all agreements, instruments and corporate or other restrictions to which
it or any Restricted Subsidiary is subject, and all other matters known to it,
that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect. None of the reports, financial statements,
certificates or other information furnished by or on behalf of any Loan Party to
the Administrative Agent or any Lender in connection with the negotiation of
this Agreement or any other Loan Document (as modified or supplemented by other
information so furnished), when taken as a whole, 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 Borrowers and Holdings represent only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time delivered and, if such projected financial information was delivered prior
to the Effective Date, as of the Effective Date, it being recognized by the
Lenders that such projections as to future events are not to be viewed as facts
and that actual results during the period or periods covered by any such
projections may materially differ from the projected results.

 

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SECTION 3.12 Material Agreements. All material agreements and contracts to which
any Loan Party is a party or is bound as of the date of this Agreement are
either (a) filed as exhibits to, or incorporated by reference in, the reports of
Holdings that were filed with the SEC, prior to the Effective Date, or
(b) listed on Schedule 3.12. No Loan Party is in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in (i) any agreement or contract to which it is a party, except where
such default could not reasonably be expected to have a Material Adverse Effect,
or (ii) any agreement or instrument evidencing or governing Indebtedness in a
principal amount, individually or in the aggregate, in excess of $20,000,000.

SECTION 3.13 Solvency. Immediately after the consummation of the Transactions to
occur on the Effective Date and on the date of each Borrowing and the date any
Letter of Credit is issued, amended, renewed or extended, (a) the sum of the
debt (including contingent liabilities) of Holdings and its Subsidiaries and the
Company and its Subsidiaries, in each case on a consolidated basis, will not
exceed the present fair saleable value of the present assets of Holdings and its
Subsidiaries and the Company and its Subsidiaries, respectively, on a
consolidated basis, (b) the present and fair saleable value of the assets of
Holdings and its Subsidiaries and the Company and its Subsidiaries, in each case
on a consolidated basis, is greater than the total amount that will be required
to pay the probable liabilities (including contingent liabilities) of Holdings
and its Subsidiaries and the Company and its Subsidiaries, respectively, in each
case as they become absolute and matured, (c) the capital of Holdings and its
Subsidiaries and the Company and its Subsidiaries, in each case on a
consolidated basis, is not unreasonably small in relation to their respective
businesses as contemplated on the date hereof, (d) Holdings and its Subsidiaries
and the Company and its Subsidiaries, in each case on a consolidated basis, have
not incurred and do not intend to incur, nor believe that they will incur,
debts, including current obligations, beyond their ability to pay such debts as
they become due (whether at maturity or otherwise), and (e) Holdings and its
Subsidiaries and the Company and its Subsidiaries, in each case on a
consolidated basis, are “solvent” within the meaning given to that term and
similar terms under applicable laws relating to fraudulent transfers and
conveyances.

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

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

SECTION 3.16 Security Interest in Collateral. The provisions of the Collateral
Documents create legal and valid Liens on all the Collateral in favor of the
Administrative Agent, for the benefit of the Administrative Agent and the
Secured Parties, and when the actions set forth in the Collateral Documents to
perfect such Liens are taken, such Liens will constitute perfected and
continuing Liens on the Collateral, securing the Secured Obligations,
enforceable against the applicable Loan Party and all third parties, and having
priority over all other Liens on the Collateral except (a) Permitted
Encumbrances, to the extent any such Permitted Encumbrances would have priority
over the Liens in favor of the Administrative Agent pursuant to any applicable
law or agreement, (b) Liens perfected only by possession (including possession
of any certificate of title) to the extent the Administrative Agent has not
obtained or does not maintain possession of such Collateral, and (c) as provided
in the Intercreditor Agreement (to the extent applicable).

 

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

SECTION 3.18 Common Enterprise. The successful operation and condition of each
of the Loan Parties is dependent on the continued successful performance of the
functions of the group of the Loan Parties as a whole and the successful
operation of each of the Loan Parties is dependent on the successful performance
and operation of each other Loan Party. Each Loan Party expects to derive
benefit (and its board of directors or other governing body has determined that
it may reasonably be expected to derive benefit), directly and indirectly, from
(i) successful operations of each of the other Loan Parties and (ii) the credit
extended by the Lenders to the Borrowers hereunder, both in their separate
capacities and as members of the group of companies. Each Loan Party has
determined that execution, delivery, and performance of this Agreement and any
other Loan Documents to be executed by such Loan Party is within its purpose,
will be of direct and indirect benefit to such Loan Party, and is in its best
interest.

SECTION 3.19 Permitted Indebtedness. The execution, delivery and performance of
the Loan Documents and the incurrence of the Obligations do not conflict with or
violate the Company Notes IndentureTerm Loan Agreement or the Holdings Notes
Indenture. This Agreement and the Obligations constitute a “Credit Facility”
permitted under and as defined in the Company Notes Indenture and the Holdings
Notes Indenture.  This Agreement and the Obligations constitute a “Revolving
Facility” permitted under and as defined in the Term Loan Agreement.

SECTION 3.20 OFAC. No Loan Party (i) is a person whose property or interest in
property is blocked or subject to blocking pursuant to Section 1 of Executive
Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions
With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg.
49079 (2001)), (ii) to the best of its knowledge, engages in any dealings or
transactions prohibited by Section 2 of such executive order, or is otherwise
associated with any such person in any manner violative of Section 2, or
(iii) is a person on the list of Specially Designated Nationals and Blocked
Persons or subject to the limitations or prohibitions under any other U.S.
Department of Treasury’s Office of Foreign Assets Control regulation or
executive order.

SECTION 3.21 Patriot Act, Etc. Each Loan Party is in compliance, in all material
respects, with (i) the Trading with the Enemy Act, as amended, and each of the
foreign assets control regulations of the United States Treasury Department (31
CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or
executive order relating thereto, and (ii) the Patriot Act. No part of the
proceeds of the Loans will be used, 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.

SECTION 3.22 Margin Regulations. No Loan Party is engaged principally, as one or
more of its important activities, in the business of extending credit for the
purpose of purchasing any “margin stock” as defined in Regulation U. Neither the
making of any Loan hereunder nor the use of the proceeds thereof will violate
the provisions of Regulation T, U or X of the Board.

 

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ARTICLE IV

CONDITIONS

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

(a) Credit Agreement and Loan Documents. The Administrative Agent (or its
counsel) shall have received (i) from each party hereto either (A) a counterpart
of this Agreement signed on behalf of such party or (B) written evidence
satisfactory to the Administrative Agent (which may include facsimile or other
electronic transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement and (ii) duly executed copies
of the Loan Documents and such other certificates, documents, instruments and
agreements as the Administrative Agent shall reasonably request in connection
with the transactions contemplated by this Agreement and the other Loan
Documents, including any promissory notes requested by a Lender pursuant to
Section 2.10 payable to each such requesting Lender and a written opinion of the
Loan Parties’ counsel, addressed to the Administrative Agent, each Issuing Bank
and the Lenders in form and substance reasonably acceptable to the
Administrative Agent and the Lead Arrangers.

(b) Officer’s Certificates; Certified Certificate of Organization; Good Standing
Certificates. The Administrative Agent shall have received (i) a certificate of
each Loan Party, dated the Effective Date and executed by its secretary or
assistant secretary, which shall (A) certify the resolutions of its board of
directors, members or other body authorizing the execution, delivery and
performance of the Loan Documents to which it is a party, (B) identify by name
and title and bear the signatures of the Financial Officers and any other
officers of such Loan Party authorized to sign the Loan Documents to which it is
a party, (C) contain appropriate attachments, including the certificate or
articles of incorporation or organization of each Loan Party certified by the
relevant authority of the jurisdiction of organization of such Loan Party as of
a recent date and a true and correct copy of its by-laws or operating,
management or partnership agreement and (D) in the case of the Borrower
Representative, certify as to the condition precedent set forth in
clause (h) below, and (ii) a good standing certificate for each Loan Party from
its jurisdiction of organization.

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

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

 

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(e) Pay-Off Letter. The Administrative Agent shall have received a satisfactory
pay-off letter for the Existing Credit Agreement to be repaid from the proceeds
of the Revolving Loans advanced on the Effective Date, confirming that the
Existing Credit Agreement, all commitments thereunder and all Liens upon any of
the property of the Loan Parties constituting Collateral will be terminated
concurrently with such payment.

(f) Solvency. The Administrative Agent shall have received the Solvency
Certificate set forth as Exhibit H hereto (the “Solvency Certificate”) from a
Financial Officer.

(g) Borrowing Base Certificate. The Administrative Agent shall have received a
Borrowing Base Certificate which calculates the Borrowing Base as of the end of
the most recent calendar month ended at least 15 days prior to the Effective
Date.

(h) Closing Availability. After giving effect to all Borrowings to be made on
the Effective Date and the issuance (or deemed issuance) of any Letters of
Credit on the Effective Date and payment of all fees and expenses due hereunder,
and with all of the Loan Parties’ indebtedness, liabilities, and obligations
current, the Availability shall not be less than $50,000,000.

(i) Pledged Stock; Stock Powers. The Administrative Agent shall have received
all certificates representing the Equity Interests pledged pursuant to the
Security Agreement, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the pledgor
thereof.

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

(k) Insurance. The Administrative Agent shall have received evidence of
insurance coverage in form, scope, and substance reasonably satisfactory to the
Administrative Agent and otherwise in compliance with the terms of Section 5.09
and Section 4.11 of the Security Agreement.

(l) Appraisals. The Lead Arrangers shall have received the Inventory Appraisal
in form and scope consistent with the appraisal conducted by HILCO Appraisal
Services, LLC dated October 19, 2011 (it being acknowledged that this condition
has been satisfied as of the Effective Date by the delivery of the Inventory
Appraisal dated June 27, 2012).

(m) Field Examinations. The Lead Arrangers shall have received a satisfactory
field examination of the Borrowers’ and the other Loan Guarantors’ books,
records and Collateral conducted in a customary manner as conducted by the
Administrative Agent in connection with similar asset based lending facilities
(it being acknowledged that this condition has been satisfied as of the
Effective Date).

(n) No Company Material Adverse Effect. (i) From December 31, 2011 through the
date of the Commitment Letter, except as set forth in (A) the Company SEC
Documents (excluding, in each case, any disclosures contained or referenced
therein under the captions “Risk Factors” or “Forward Looking Statements” and
any other disclosures contained or referenced therein relating to information,
factors or risks that are predictive, cautionary or forward looking in nature)
filed with the SEC after December 31, 2011 and prior to the date of the Merger
Agreement (and then (1) only to the extent that the relevance of any disclosed
event, item or occurrence in such Company SEC Documents to a matter covered

 

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by this condition is reasonably apparent as to matters and items which are
subject of such representation or warranty, (2) other than any matters required
to be disclosed for purposes of Sections 3.1, 3.2, 3.3, 3.6 and 3.7 of the
Merger Agreement, which matters shall only be disclosed by specific disclosure
in the respective corresponding section of the Company Disclosure Letter), and
(3) without giving effect to any amendment to any such documents filed on or
after the date of the Commitment Letter) or (B) the corresponding sections or
subsections of the Company Disclosure Letter (it being acknowledged and agreed
that disclosure of any item in any section or subsection of the Company
Disclosure Letter shall be deemed disclosure with respect to any other section
or subsection only to the extent that the relevance of such disclosure to such
other section or subsection is reasonably apparent on the face of such
disclosure) and (ii) since the date of the Commitment Letter, there has not been
any event, occurrence, development or state of circumstances or facts that has
had or would reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect.

(o) Merger Consummation. The Merger shall have been consummated, or
substantially simultaneously with the initial Borrowings hereunder, shall be
consummated, in all material respects in accordance with the terms of the Merger
Agreement, without giving effect to any modifications, amendments, consents or
waivers thereto or thereunder, in each case that are materially adverse to the
Lenders or the Lead Arrangers as reasonably determined by the Lead Arrangers (it
being understood that any modification, amendment, consent or waiver (i) to the
definition of “Company Material Adverse Effect”, (ii) to the condition that the
representations regarding the accuracy of Section 3.10 of the Merger Agreement
be true and correct in all respects when made and as of the date of the
consummation of the Merger as of the time when made, and (iii) to Section 3.10
of the Merger Agreement or Section 3.10 of the Company Disclosure Letter shall
be deemed to be material and adverse to the interests of the Lenders and the
Lead Arrangers), without the prior consent of the Lead Arrangers.

(p) Equity Contribution. The Equity Contribution shall have been made.

(q) Second Supplemental Indenture. The Second Supplemental Indenture shall be
effective.

(r) Historical Financials. The Lead Arrangers shall have received (i) audited
consolidated balance sheets of Holdings and related statements of income,
changes in equity and cash flows of Holdings as of and for the fiscal years
ended December 25, 2009, December 31, 2010 and December 30, 2011, and
(ii) unaudited consolidated balance sheets and related statements of income,
changes in equity and cash flows of Holdings for the fiscal quarters ended
March 30, 2012, June 29, 2012 and, if such date precedes the Effective Date by
at least 45 days, September 28, 2012.

(s) Representations and Warranties. Each of (i) the Specified Merger Agreement
Representations and (ii) the representations and warranties in Sections 3.01,
3.02, 3.03(b)(i) and (c), 3.08, 3.13, 3.16, 3.19, 3.20, 3.21 and 3.22 shall be
true and correct in all material respects on and as of the Effective Date;
provided, that any such representation and warranty that is qualified as to
“materiality” shall be true and correct in all respects.

(t) Patriot Act, Etc. The Administrative Agent and the Lead Arrangers shall have
received, at least three days prior to the Effective Date, all customary
documentation and other information about Holdings, the Company and the other
Loan Guarantors as has been reasonably requested in writing at least five days
prior to the Effective Date by the Administrative Agents or the Joint
Bookrunners that they reasonably determine is required under applicable “know
your customer” and anti-money laundering rules and regulations, including
without limitation the Patriot Act.

 

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(u) Closing Certificate. The Administrative Agent shall have received a
certificate, signed by an authorized officer of the Borrower Representative, on
the Effective Date certifying that the conditions set forth in clauses (n), (o),
(p), (q) and (s) of this Section 4.01 have been satisfied and attaching thereto
true and complete copies of (A) the fully-executed Merger Agreement and the
other material documents evidencing the closing of the transactions contemplated
by the Merger Agreement and (B) the fully-executed Second Supplemental
Indenture.

(v) Pro Forma Financial Statements. The Lead Arrangers shall have received a pro
forma consolidated balance sheet and related pro forma consolidated statement of
income of Holdings as of and for the twelve-month period ending on the last day
of the most recently completed four-fiscal quarter period ended at least 45 days
prior to the Effective Date, prepared after giving effect to the Transactions as
if the Transactions had occurred as of such date (in the case of such balance
sheet) or at the beginning of such period (in the case of such other financial
statements), which shall be prepared in compliance with Regulation S-X of the
Securities Act of 1933, as amended (subject to exceptions customary for
offerings conducted under Rule 144A or otherwise mutually agreed), including
preliminary adjustments for purchase accounting (including adjustments of the
type contemplated by Financial Accounting Standards Board Accounting Standards
Codification 805, Business Combinations (formerly SFAS 141R)).

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

The Administrative Agent shall notify the Borrowers and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans and of the Issuing
Banks to issue Letters of Credit hereunder shall not become effective unless
each of the foregoing conditions is satisfied (or waived with the consent of all
Lenders) at or prior to 11:59 p.m., New York City time, on November 29, 2012
(and, in the event such conditions are not so satisfied or waived, the
Commitments shall terminate at such time). The acceptance by the Borrowers of
the initial Borrowings and the issuance (or deemed issuance) of the initial
Letters of Credit hereunder shall constitute a representation and warranty that
all of the representations and warranties of the Borrowers set forth in this
Agreement are true and correct.

SECTION 4.02 Each Credit Event. Other than the initial Borrowings and Letters of
Credit issued (or deemed issued) on the Effective Date, the obligation of each
Lender to make a Loan on the occasion of any Borrowing, and of the Issuing Banks
to issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:

(a) The representations and warranties of the Borrowers set forth in this
Agreement shall be true and correct in all material respects on and as of the
date of such Borrowing or the date of issuance, amendment, renewal or extension
of such Letter of Credit, as applicable; provided, that any such representations
and warranties that are qualified as to “materiality” or “Material Adverse
Effect” shall be true and correct in all respects (it being understood that such
representations and warranties that relate solely to an earlier date or period
shall be true and correct in all material respects as of such earlier date or
for the respective period, as the case may be).

(b) At the time of and immediately after giving effect to such Borrowing or the
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no Default shall have occurred and be continuing.

(c) Availability is not less than the amount of the proposed Borrowing or
Letters of Credit.

 

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

ARTICLE V

AFFIRMATIVE COVENANTS

Until the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees payable hereunder shall have been paid in
full and all Letters of Credit shall have expired, been cash collateralized,
backstopped or terminated and all LC Disbursements shall have been reimbursed
(in each case other than contingent indemnification obligations for which no
claim has been identified), each Loan Party executing this Agreement covenants
and agrees, jointly and severally with all of the Loan Parties, with the Lenders
that:

SECTION 5.01 Financial Statements; Borrowing Base and Other Information. The
Borrowers will furnish to the Administrative Agent:

(a) within 90 days after the end of each fiscal year of Holdings, its audited
consolidated balance sheet and related statements of operations, stockholders’
equity and cash flows as of the end of and for such year, setting forth in each
case in comparative form the figures for the previous fiscal year, all reported
on by Deloitte & Touche LLP or another independent public accountants of
recognized national standing (without a “going concern” or like qualification or
exception (other than with respect to the current maturity of the Obligations in
the case of the audit for the fiscal year ending December 31, 2016 in the event
such maturity is not extended) and without any qualification or exception as to
the scope of such audit) to the effect that such consolidated financial
statements present fairly in all material respects the financial condition and
results of operations of Holdings and its consolidated Restricted Subsidiaries
on a consolidated basis in accordance with GAAP consistently applied;

(b) within 45 days after the end of each of the first three fiscal quarters of
Holdings, its consolidated balance sheet and related statements of operations,
stockholders’ equity and cash flows as of the end of and for such fiscal quarter
and the then elapsed portion of the fiscal year, setting forth in each case in
comparative form the figures for the corresponding period or periods of (or, in
the case of the balance sheet, as of the end of) the previous fiscal year, all
certified by a Financial Officer of Holdings as presenting fairly in all
material respects the financial condition and results of operations of Holdings
and its consolidated Restricted Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes;

(c) concurrently with any delivery of financial statements under clause (a) or
(b) above, a certificate of a Financial Officer of Holdings in substantially the
form of Exhibit C (a “Compliance Certificate”) (i) certifying, in the case of
the financial statements delivered under clause (b), as presenting fairly in all
material respects the financial condition and results of operations of Holdings
and its consolidated Restricted Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes, (ii) certifying as to whether a
Default has occurred and, if a Default has occurred, specifying the details
thereof and any action taken or proposed to be taken with respect thereto,
(iii) setting forth a reasonably detailed calculation of the Fixed Charge
Coverage Ratio for the most recently ended four fiscal quarters (whether or not
during a Covenant Trigger Period) and, if applicable, demonstrating compliance
with Section 6.12, (iv) the amount of any Pro Forma Adjustment not previously
set forth in a Pro Forma Adjustment Certificate or any change in the amount of a
Pro Forma Adjustment set forth in any Pro Forma Adjustment Certificate
previously provided and, in either case, in reasonable detail, the calculations
and basis therefor and (v) stating whether

 

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any change in GAAP or in the application thereof has occurred since the date of
the audited financial statements referred to in Section 3.04 and, if any such
change has occurred, specifying the effect of such change on the financial
statements accompanying such certificate;

(d) as soon as available, but in any event not more than 90 days after the end
of each fiscal year of Holdings, a copy of the plan and forecast (including a
projected consolidated balance sheet, income statement and cash flow statement)
of Holdings for each month of the upcoming fiscal year (the “Projections”) in
form consistent with the projections delivered to and approved by the board of
directors of Holdings;

(e) as soon as available but in any event within 15 Business Days of the end of
each calendar month end (or within 3 Business Days after the last Business Day
of each week during any Covenant Trigger Period), as of the period then ended, a
Borrowing Base Certificate and supporting information in connection therewith;
provided, that the Borrowers may deliver updates to the Borrowing Base (i) in
connection with any Permitted Acquisition, at least three Business Days prior to
the consummation of such Permitted Acquisition, in which case, the Borrowing
Base may include, as provided in clause (j) of the definition of “Permitted
Acquisition”, the Eligible Accounts and Eligible Inventory acquired or to be
acquired in connection with such Permitted Acquisition, and (ii) at such other
times as the Administrative Agent may agree in its discretion;

(f) as soon as available but in any event within 15 Business Days of the end of
each calendar month end (and within 3 Business Days after the last Business Day
of each week during any Covenant Trigger Period), as of the period then ended,
all of the collateral monitoring reporting requirements listed on Exhibit E;

(g) as soon as reasonably practicable following the Administrative Agent’s
request (to the extent available):

(i) copies of invoices in connection with the invoices issued by the Borrowers
in connection with any Accounts, credit memos, shipping and delivery documents,
and other information related thereto;

(ii) copies of purchase orders and invoices in connection with any Inventory or
Equipment purchased by any Loan Party;

(iii) a schedule of account balances of all intercompany accounts of the Loan
Parties; and

(iv) as of the period then ended, the Borrowers’ sales journal and cash receipts
journal (identifying trade and non-trade cash receipts);

(h) as soon as reasonably practicable after the Administrative Agent’s request,
but (so long as no Default is continuing) no more frequently than annually, an
updated customer list for the Borrowers and their Restricted Subsidiaries, which
list shall state the customer’s name, mailing address and phone number and shall
be certified by a Financial Officer of the Borrower Representative as true and
correct in all material respects to the best of the Financial Officer’s
knowledge;

(i) as soon as reasonably practicable after the same become publicly available,
copies of all periodic and other reports, proxy statements and other materials
filed by Holdings, any Borrower or any Restricted Subsidiary with the SEC, or
any Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, or distributed by Holdings
to its shareholders generally, as the case may be;

 

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(j) not later than any date on which financial statements are delivered with
respect to the most recently ended four fiscal quarters in which a Pro Forma
Adjustment is made as a result of the consummation of the acquisition of any
Acquired Entity or Business by any Borrower or any Restricted Subsidiary for
which there shall be a Pro Forma Adjustment, a Pro Forma Adjustment Certificate;
and

(k) as soon as reasonably practicable following any request therefor, such other
information regarding the operations, business affairs and financial condition
of Holdings or any Restricted Subsidiary, or compliance with the terms of this
Agreement, as the Administrative Agent or any Lender (through the Administrative
Agent) may reasonably request.

To the extent that any of the documents required to be delivered pursuant to
Sections 5.01(a), (b) or (i) are also filed with the SEC, the Borrowers may
fulfill such delivery requirements by providing the Administrative Agent, in
writing, an internet link to a corresponding SEC filing that conforms with the
requirements of such Sections. The Administrative Agent will promptly forward
all deliveries and notices received by it from by the Loan Parties under this
Section 5.01 to each of the Lenders (other than clauses (f) through (h), which
will be made available to each Lender at such Lender’s request), which
communication may be made by delivery of hard copies, email or posting the
information to an intranet or internet site or other electronic communication
methods adopted by the Administrative Agent, and will provide notice to each
such Lender of the posting of any such intranet, internet or other electronic
communication.

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

(a) the occurrence of any Default;

(b) (i) any governmental investigation or any litigation or proceeding commenced
or threatened against any Loan Party that (A) seeks damages in excess of
$15,000,000,25,000,000, (B) seeks material injunctive relief, or (C) alleges
criminal misconduct by any Loan Party, or (ii) receipt of any notice of any
governmental investigation or any litigation or proceeding commenced or
threatened by a Governmental Authority against any Loan Party that alleges any
tax, fee, assessment, or other governmental charge in excess of
$10,000,00025,000,000;

(c) any Lien (other than Permitted Encumbrances and Liens permitted under
Section 6.02(l) and (k)) or claim made or asserted against any Inventory or
Accounts of any Loan Party;

(d) any loss, damage, or destruction to Inventory in the amount of
$15,000,00020,000,000 or more (or other Collateral in an amount of
$25,000,00040,000,000 or more), whether or not covered by insurance;

(e) any and all default notices received under or with respect to any leased
location or public warehouse where Inventory with a fair market value exceeding
$5,000,00010,000,000 is located alleging non-payment of rent or other amounts
due in excess of three months’ rent to the relevant landlord or warehouseman or
any other material default;

(f) the entry by any Loan Party into a Swap Agreement, agreement to provide
Banking Services or amendment thereto with a Lender or Lead Arranger or an
Affiliate of a Lender or Lead Arranger that is intended to be secured by the
Collateral, together with copies of all agreements evidencing such Swap
Agreement, agreement to provide Banking Services or amendment thereto (which
shall be delivered within ten (10) Business Days of entry into such Swap
Agreement, agreement to provide Banking Services or amendment thereto);

 

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(g) the occurrence of any ERISA Event that, alone or together with any other
ERISA Events that have occurred, could reasonably be expected to result in
liability of the Borrowers and the Restricted Subsidiaries in an aggregate
amount exceeding $20,000,000a Material Adverse Effect; and

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

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower Representative
setting forth the details of the event or development requiring such notice and
any action taken or proposed to be taken with respect thereto. The
Administrative Agent will promptly forward all notices received by it from the
Loan Parties under this Section 5.02 to each of the Lenders, which communication
may be made by delivery of hard copies, email or posting the information to an
intranet or internet site or other electronic communication methods adopted by
the Administrative Agent, and will provide notice to each such Lender of the
posting of any such intranet, internet or other electronic communication.

SECTION 5.03 Existence; Conduct of Business. Each Loan Party will, and will
cause each Restricted Subsidiary to, do or cause to be done all things necessary
to preserve, renew and keep in full force and effect its legal existence and,
except where the failure to so preserve, renew or keep in full force and effect
any of the following could not reasonably be expected to result in a Material
Adverse Effect, the rights, qualifications, licenses, permits, franchises,
governmental authorizations, intellectual property rights, licenses and permits
for the conduct of its business, and maintain all requisite authority to conduct
its business in each jurisdiction in which its business is conducted; provided
that the foregoing shall not prohibit any merger, consolidation, liquidation or
dissolution permitted under Section 6.03.

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

SECTION 5.05 Maintenance of Properties. Each Loan Party will, and will cause
each Restricted Subsidiary to, keep and maintain all property material to the
conduct of its business in good working order and condition, ordinary wear and
tear excepted, except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.

SECTION 5.06 Books and Records; Inspection Rights. Each Loan Party will, and
will cause each Restricted Subsidiary to, (i) keep proper books of record and
account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities and (ii) permit any
representatives designated by the Administrative Agent or any Lead Arranger
(including employees of the Administrative Agent, any Lead Arranger or any
consultants, accountants, lawyers and appraisers retained by the Administrative
Agent), upon reasonable prior notice, to visit and inspect its properties, to
examine and make extracts from its books and records, and to discuss its
affairs, finances and condition with its officers and independent accountants,
all at such reasonable times and as often as reasonably requested. The Borrowers
shall reimburse the Administrative Agent and/or its representatives for all
reasonable charges, costs and expenses related thereto with respect to no more
than one such inspection during each

 

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calendar year; provided, however, that if Availability is less than the greater
of (a) $43,750,000 or (b) 17.5% of the Commitments at any time, the Borrowers
shall reimburse the Administrative Agent and/or its representatives for all
reasonable charges, costs and expenses related to a second such inspection
during such calendar year; and provided, further, that there shall be no
limitation on the number or frequency of inspections that shall be at the sole
expense of the Borrowers if any Event of Default shall have occurred and be
continuing. The limits set forth in the foregoing sentence on the number of
inspections required to be reimbursed by the Borrowers shall not apply to, or
include, any inspections conducted pursuant to clause (j) of the definition of
“Permitted Acquisition”. The Loan Parties acknowledge that the Administrative
Agent, after exercising its rights of inspection, may prepare and distribute to
the Lenders certain Reports pertaining to the Loan Parties’ assets for internal
use by the Administrative Agent and the Lenders.

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

SECTION 5.08 Use of Proceeds. The proceeds of the Loans will be used (a) on the
Effective Date (i) to refinance the Existing Credit Agreement, including the
cash collateralization or back-to-back credit support of the outstanding letters
of credit thereunder that are not Existing Letters of Credit and (ii) to make
the Specified Distribution; provided that (1) the aggregate amount funded
hereunder does not exceed $110,000,000 and (2) Availability is greater than 20%
of the Commitments before and after giving effect thereto, and (b) following the
Effective Date (i) to issue Letters of Credit and (ii) for the working capital
needs and general corporate purposes of the Borrowers and the Restricted
Subsidiaries, including to fund distributions permitted under Section 6.08. No
part of the proceeds of any Loan and no Letter of Credit will be used, whether
directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations T, U and X.

SECTION 5.09 Insurance. Each Loan Party will, and will cause each Restricted
Subsidiary to, maintain with financially sound and reputable carriers having a
financial strength rating of at least A- by A.M. Best Company (a) insurance in
such amounts (with no greater risk retention) and against such risks (including
loss or damage by fire, business interruption and general liability) and such
other hazards, as is reasonably available and is customarily maintained by
companies of established repute engaged in the same or similar businesses
operating in the same or similar locations with asset-based loan facilities and
(b) all insurance required pursuant to the Collateral Documents. The Borrowers
will furnish to the Lenders, upon request of the Administrative Agent,
information in reasonable detail as to the insurance so maintained.

SECTION 5.10 Appraisals. Subject to the reimbursement limitations contained in
the next sentence, at any time that the Administrative Agent requests the
Borrowers and the Restricted Subsidiaries will provide the Administrative Agent
with appraisals or updates thereof of their Inventory from an appraiser selected
and engaged by the Administrative Agent, and prepared on a basis reasonably
satisfactory to the Administrative Agent, such appraisals and updates to
include, without limitation, information required by applicable law and
regulations. The Borrowers shall reimburse the Administrative Agent for all
reasonable charges, costs and expenses related thereto with respect to no more
than one such appraisal during each calendar year; provided, however, that if
Availability is less than the greater of (a) $50,000,00043,750,000 or
(b) 2017.5% of the Commitments at any time, the Borrowers shall reimburse the
Administrative Agent for all reasonable charges, costs and expenses related to a
second such appraisal during such calendar year; and provided further, that
there shall be no limitation on the number or frequency of appraisals and
updates that shall be at the sole expense of the Borrowers if any Event of
Default shall have occurred and be continuing. The limits set forth in the
foregoing sentence on the number of appraisals required to be reimbursed by the
Borrowers shall not apply to, or include, any appraisals obtained pursuant to
clause (j) of the definition of “Permitted Acquisition”.

 

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SECTION 5.11 Field Examinations. Subject to the reimbursement limitations
contained in the next sentence, at any time that the Administrative Agent
requests the Borrowers and the Restricted Subsidiaries will allow the
Administrative Agent (or its designee) to conduct field examinations or updates
thereof to ensure the adequacy of Collateral included in any Borrowing Base and
related reporting and control systems, and prepared on a basis reasonably
satisfactory to the Administrative Agent, such field examinations and updates to
include, without limitation, information required by applicable law and
regulations. The Borrowers shall reimburse the Administrative Agent for all
reasonable charges, costs and expenses related thereto with respect to no more
than one such field examination during each calendar year; provided, however,
that if Availability is less than the greater of (a) $50,000,00043,750,000 or
(b) 2017.5% of the Commitments at any time, the Borrowers shall reimburse the
Administrative Agent for all reasonable charges, costs and expenses related to a
second such field examination during such calendar year; and provided, further,
that there shall be no limitation on the number or frequency of field
examinations that shall be at the sole expense of the Borrowers if any Event of
Default shall have occurred and be continuing. The limits set forth in the
foregoing sentence on the number of field examinations required to be reimbursed
by the Borrowers shall not apply to, or include, any field examinations
conducted pursuant to clause (j) of the definition of “Permitted Acquisition”.

SECTION 5.12 Depository Banks. Each Loan Party will maintain the Administrative
Agent or another Lender as its principal depository bank, including for the
maintenance of operating, administrative, cash management, and other deposit
accounts for the conduct of its business, provided, that, subject to
Section 5.14, the Loan Parties shall maintain their collection accounts with
BofA (or another financial institution selected by such Person and acceptable to
the Administrative Agent), which collection accounts shall be subject to deposit
account control agreements meeting the requirements of the Security Agreement.

SECTION 5.13 Additional Collateral; Further Assurances. (a) Subject to
applicable law, each Borrower and each Restricted Subsidiary that is a Loan
Party shall cause each of its Domestic Subsidiaries (other than an Excluded
Subsidiary) formed or acquired after the date of this Agreement in accordance
with the terms of this Agreement to become a Loan Party (either as a Borrower or
a Loan Guarantor) by executing the Joinder Agreement set forth as Exhibit D
hereto (the “Joinder Agreement”). Upon execution and delivery thereof, each such
Person (i) shall automatically become a Borrower or Loan Guarantor hereunder as
specified in such Joinder Agreement, and thereupon shall have all of the rights,
benefits, duties, and obligations in such capacity under the Loan Documents and
(ii) will grant Liens to the Administrative Agent, for the benefit of the
Administrative Agent and the Secured Parties, in any property of such Loan Party
which constitutes Collateral of the types contemplated by the Collateral
Documents.

(b) Each Loan Party will cause 100% of the issued and outstanding Equity
Interests of each of its Domestic Subsidiaries (other than (i) Excluded
Subsidiaries described in clauses (c) or (f) of the definition therefor and
(ii) Excluded Subsidiaries described in clause (a) thereof to the extent that
the constituent documents of such Excluded Subsidiaries prohibit the granting of
Liens thereon) owned by it to be subject at all times to a first priority,
perfected Lien in favor of the Administrative Agent pursuant to the terms and
conditions of the Loan Documents or other security documents as the
Administrative Agent shall reasonably request.

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

 

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(d) If any material assets (other than assets not required to be Collateral
under the terms of the Collateral Documents) are acquired by any Loan Party
after the Effective Date (other than assets constituting Collateral under the
Security Agreement that become subject to the Lien in favor of the Security
Agreement upon acquisition thereof), the Borrower Representative will notify the
Administrative Agent and the Lenders thereof, and, if requested by the
Administrative Agent or the Required Lenders, the Loan Parties will cause such
assets to be subjected to a Lien securing the Secured Obligations and will take
such actions as shall be necessary or reasonably requested by the Administrative
Agent to grant and perfect such Liens, including actions described in paragraph
(c) of this Section, all at the expense of the Loan Parties.

(e) If any Loan Party grants Liens on any real property or any interest therein
pursuant to, and in compliance with the requirements of Section 6.02(l), the
Borrower Representative will notify the Administrative Agent thereof, and, the
Loan Parties will cause such real property (or interest therein) to be subjected
to a Lien securing the Secured Obligations, subject to the Intercreditor
Agreement, and will take such actions as shall be necessary or reasonably
requested by the Administrative Agent to grant and perfect such Liens, including
actions described in paragraph (c) of this Section, all at the expense of the
Loan Parties.

(f) Notwithstanding anything to the contrary in this Section 5.13 or any other
provision of this Agreement or any Collateral Document, Holdings shall not be
required to grant or take any other action with respect to a security interest
in any assets of Holdings (including the Equity Interests of the Company held by
it); provided that, if at any time after the Term Loan Closing Date, (i) the
Holdings Notes or any Holdings Refinancing Indebtedness are repaid, repurchased,
redeeemed, defeased or otherwise acquired or retired, (ii) Holdings grants a
security interest in any of its assets as security for any obligations under the
Term Loan Documents or (iii) the Term Loans are no longer secured (the first to
occur of an event under the foregoing clauses, a “Holdings Security Event”),
Holdings shall, within 90 days of the Holdings Security Event, execute and
deliver a Joinder Agreement in respect of the Security Agreement to the
Administrative Agent pursuant to which it shall grant Liens to the
Administrative Agent, for the benefit of the Administrative Agent and the
Secured Parties, in any property of Holdings which constitutes Collateral of the
types contemplated by the Collateral Documents in effect at such time and
Holdings shall execute and deliver to the Administrative Agent such additional
documents, agreements and instruments, and will take or cause to be taken such
further actions (including the filing and recording of financing statements,
fixture filings and other documents and such other actions or deliveries of the
type required by Section 4.01, as applicable), which may be required by law or
which the Administrative Agent may, from time to time, reasonably request to
carry out the terms and conditions of the Credit Agreement and the other Loan
Documents with respect to security and to ensure perfection and priority of the
Liens created or intended to be created by the Collateral Documents, all at the
expense of the Loan Parties.

SECTION 5.14 Post-Closing Actions. Each Loan Party agrees that it will, or will
cause its relevant Subsidiaries to, complete each of the actions described on
Schedule 5.14 as soon as commercially reasonable and by no later than the date
set forth in Schedule 5.14 with respect to such action or such later date as the
Administrative Agent may reasonably agree.

 

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ARTICLE VI

NEGATIVE COVENANTS

Until the Commitments have expired or terminated and the principal of and
interest on each Loan and all fees, expenses and other amounts payable under any
Loan Document have been paid in full and all Letters of Credit have expired,
been cash collateralized, backstopped or terminated and all LC Disbursements
shall have been reimbursed (in each case other than contingent indemnification
obligations for which no claim has been identified), the Loan Parties covenant
and agree, jointly and severally, with the Lenders that:

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

(a) the Secured Obligations;

(b) in the case of the Companythe First Lien Obligations of Holdings, the
Company Notesor any Restricted Subsidiary in an aggregate principal amount that
does not to exceed (x) the aggregate principal amount of the Company Notes
outstanding immediately following the consummation of the Transactions less
(yexceed the First Lien Debt Cap; provided, that (i) such Indebtedness is
comprised of term loans or notes and has a final maturity date no earlier than
the date that is 91 days following the Maturity Date and (ii) in the aggregate
principal amount of the Company Notes redeemed, repurchased or retired pursuant
to Section 6.08 (other than to the extent refinanced pursuant to
Section 6.01(i));case of secured Indebtedness, the Liens securing such
Indebtedness are subject to the Intercreditor Agreement.

(c) in the case of Holdings, the Holdings Notes in an aggregate principal amount
not to exceed (x) the aggregate principal amount of the Holdings Notes
outstanding immediately following the consummation of the Transactions less
(y) the aggregate principal amount of the Holdings Notes redeemed, repurchased
or retired pursuant to Section 6.08 (other than to the extent refinanced
pursuant to Section 6.01(i));

(d) Indebtedness existing on the date hereof (other than the Term Loans and the
Holdings Notes) and set forth in Schedule 6.01 and extensions, renewals and
replacements of any such Indebtedness in accordance with clause (i) hereof;

(e) Indebtedness of any Borrower to any Restricted Subsidiary and of any
Restricted Subsidiary to any Borrower or any other Restricted Subsidiary,
provided that (i) Indebtedness of any Subsidiary that is not a Loan Party to any
Borrower or any Subsidiary that is a Loan Party shall be subject to Section 6.04
and (ii) Indebtedness of any Borrower to any Restricted Subsidiary that is not a
Loan Party and Indebtedness of any Restricted Subsidiary that is a Loan Party to
any Restricted Subsidiary that is not a Loan Party shall be subordinated to the
Secured Obligations and evidenced by a promissory note, in each case on terms
and conditions satisfactory to the Administrative Agent;

(f) Guarantees by (i) Holdings of Indebtedness described in clause (b) and
(ii) any Borrower of Indebtedness of any Restricted Subsidiary and by any
Restricted Subsidiary of Indebtedness of any Borrower or any other Restricted
Subsidiary, provided that in each case (1) the Indebtedness so Guaranteed is
permitted by this Section 6.01, (2) Guarantees by any Borrower or any Subsidiary
that is a Loan Party of Indebtedness of any Restricted Subsidiary that is not a
Loan Party shall be subject to Section 6.04 and (3) Guarantees permitted under
this clause (f) shall be subordinated to the Secured Obligations of the
applicable Restricted Subsidiary on the same terms as the Indebtedness so
Guaranteed is subordinated to the Secured Obligations;

 

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(g) Indebtedness of any Loan Party or any Restricted Subsidiary incurred to
finance the acquisition, construction or improvement of any fixed or capital
assets (whether or not constituting purchase money Indebtedness), including
Capital 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 in accordance with clause (i) hereof; provided that (i) such
Indebtedness is incurred prior to or within 180 days after such acquisition or
the completion of such construction or improvement and (ii) the aggregate
principal amount of Indebtedness permitted by this clause (g) shall not exceed
$25,000,000 at any time outstandingthe greater of (A) $30,000,000 and (B) 3.0%
of Consolidated Total Assets;

(h) Guarantees of Indebtedness not to exceed $5,000,000 incurred on behalf of
one or more joint ventures in which any of the Loan Parties is an investor to
the extent permitted by Section 6.04;

(i) Indebtedness which represents an extension, refinancing, or renewal of any
of the Indebtedness described in clauses (b), (c), (d), (g), (l), (m), (s) and
(t) hereof; provided that, (i) the principal amount of such Indebtedness is not
increased (other than increases in principal (A) by an amount equal to any
premiums, fees or other costs of such refinancing, and (B) in the case of the
Indebtedness described in clause (b), by an amount equal to the amount of the
Indebtedness then permitted under clause (c) in connection with a repayment in
full of such Indebtedness utilizing the proceeds of a refinancing of the Company
Notes), (ii) except as permitted by Section 6.02(l)(i),), (ii) any Liens
securing such Indebtedness are not extended to any additional property of any
Loan Party, (iii) no Loan Party that is not originally obligated with respect to
repayment of such Indebtedness is required to become obligated with respect
thereto, (iv) such extension, refinancing or renewal does not result in a
shortening of the average weighted maturity of the Indebtedness so extended,
refinanced or renewed, (v) except in the case of Indebtedness extended,
refinanced or renewed at, or within twelve months prior to, maturity, the
representations, covenants and defaults applicable of any such extension,
refinancing, or renewal, taken as a whole, are not materially more burdensome to
Borrowers than those applicable to the Indebtedness being extended, refinanced
or renewed, and (vi) if the Indebtedness that is refinanced, renewed, or
extended was subordinated in right of payment to the Obligations or the Secured
Obligations, then the terms and conditions of the refinancing, renewal, or
extension Indebtedness must include subordination terms and conditions that are
at least as favorable to the Administrative Agent and the Lenders as those that
were applicable to the refinanced, renewed, or extended Indebtedness;

(j) Indebtedness owed to any person providing workers’ compensation, health,
disability or other employee benefits or property, casualty or liability
insurance, pursuant to reimbursement or indemnification obligations to such
person, in each case incurred in the ordinary course of business;

(k) Indebtedness of any Borrower or any Restricted Subsidiary in respect of
performance bonds, bid bonds, appeal bonds, surety bonds, performance and
completion guarantees and similar obligations not in connection with borrowed
money, in each case provided in the ordinary course of business;

(l) Indebtedness of any Person that becomes a Restricted Subsidiary (or is a
Restricted Subsidiary that survives a merger with such Person) or Indebtedness
relating to assets that are acquired by any Borrower or any Restricted
Subsidiary, in each case, after the Effective Date as the result of a Permitted
Acquisition; provided that (i) such Indebtedness existed at the time such Person
became a Restricted Subsidiary or at the time such assets were acquired and, in
each case, and was not created in anticipation thereof, (ii) such Indebtedness
is not guaranteed in any respect by any Borrower or any Restricted Subsidiary
(other than by any such Person that so becomes a Restricted Subsidiary or is the
survivor of a merger with such Person and any of its Subsidiaries), (iii) to the
extent required under Section 5.13, such Person executes a Joinder Agreement in
order to become a Loan Party, and (iv) the aggregate principal amount of
Indebtedness permitted by this clause (l) shall not exceed $30,000,000 at any
time outstanding;

 

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(m) Indebtedness of any Borrower or any Restricted Subsidiary consisting of
Capital Lease Obligations incurred in connection with the sale and leaseback
transactions relating to the Specified Properties permitted by Section 6.06(b);

(n) letters of credit, bank guarantees or bankers’ acceptances (other than
Letters of Credit issued pursuant to Section 2.06) having an aggregate face
amount not in excess of $10,000,00015,000,000;

(o) unsecured Indebtedness owed to the Sponsors, certain Sponsor related parties
and/or other holders of the Equity Interests in Holdings and their respective
Affiliates; provided that such Indebtedness is Subordinated Indebtedness;

(p) Indebtedness of Holdings or any Restricted Subsidiary consisting of (i) the
financing of insurance premiums, (ii) take-or-pay obligations contained in
supply arrangements, in each case, incurred in the ordinary course of business
and not in connection with the borrowing of money, or (iii) Swap Obligations;

(q) cash management obligations and other Indebtedness of Foreign Subsidiaries
in respect of netting services, overdraft facilities, employee credit card
programs, Cash Pooling Arrangements or similar arrangements in connection with
cash management and deposit accounts; provided that with respect to any Cash
Pooling Arrangements, the total amount of all deposits subject to any such Cash
Pooling Arrangements shall at all times equal or exceed the total amount of
overdrafts that may be subject to such Cash Pooling Arrangements;

(r) Indebtedness arising from agreements of Holdings or any Restricted
Subsidiary providing for indemnification, adjustment of purchase price or
similar obligations, in each case, entered into in connection with Permitted
Acquisitions, other than Guarantees incurred by any Person acquiring all or any
portion of such business, assets or Equity Interests for the purpose of
financing any such Permitted Acquisition, or in connection with dispositions of
any business, assets or Equity Interests permitted hereunder; provided that
(i) such Indebtedness is not reflected on the balance sheet of Holdings or any
Restricted Subsidiary (it being understood that contingent obligations referred
to in a footnote to financial statements and not otherwise reflected on the
balance sheet will not be deemed to be reflected on such balance sheet for
purposes of this clause (r)) and (ii) the maximum assumable liability in respect
of all such Indebtedness shall at no time exceed the gross proceeds, including
non-cash proceeds (the fair market value of such non-cash proceeds being
measured at the time received and without giving effect to any subsequent
changes in value) actually received by the Borrowers and the Restricted
Subsidiaries in connection with any such disposition;

(s) unsecured Indebtedness of Holdingsthe Company and its Restricted
Subsidiaries in an aggregate amount not to exceed $25,000,000 at any time;
andthe greater of (A) $150,000,000 and (B) 15.0% of Consolidated Total Assets;

(t) other Indebtedness of Holdingsthe Company and its Restricted Subsidiaries;
provided, that (i) at(A) in the time such Indebtedness is issued or otherwise
incurred after giving effect thereto on a pro forma basis (including a pro forma
application of the Net Proceeds therefrom), the Consolidated Total Debt to
EBITDA Ratio is not greater than 6.25 to 1.0, (ii) such Indebtedness shall not
be secured Indebtedness unless (A) at the time such Indebtedness is issued or
otherwise incurred after giving effect thereto on a pro forma basis (including a
pro forma application of the Net Proceeds therefrom), the

 

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Secured Leverage Ratio is not greater than 5.00 to 1.0 (or such lesser ratio as
may be provided for in the Company Notes Indenture, the Holdings Notes Indenture
or any refinancings thereof permitted under Section 6.01(i)), (B) such secured
Indebtedness is a term loan or notes andevent that the proceeds of such
Indebtedness are used to repay, repurchase, redeem, defease or otherwise acquire
or retire the Holdings Notes or any Holdings Refinancing Indebtedness, in whole
or in part, the Interest Coverage Ratio would not be less than 2.00:1.00
calculated on a Pro Forma Basis for the most recently ended Reference Period
prior to the date of the incurrence thereof or (B) in the event that the
proceeds of such Indebtedness are used for a purpose other than that described
in the foregoing clause (A), (1) if such Indebtedness is secured on a
“first-lien” basis, the First Lien Leverage Ratio would not exceed 3.75:1.00
calculated on a Pro Forma Basis as of the last day of the most recently ended
Reference Period prior to the date of the applicable incurrence, and (2) if such
Indebtedness is secured on a “second-lien” or other junior lien basis or is
unsecured, the Total Leverage Ratio would not exceed 6.50:1.00 calculated on a
Pro Forma Basis as of the last day of the most recently ended Reference Period
prior to the date of the incurrence thereof, (ii) in any case such Indebtedness
is comprised of term loans or notes and (except with respect to any Indebtedness
incurred to finance a Permitted Acquisition or other Investment permitted by
Section 6.04 and (A) owed to the seller of any property or assets acquired in
such Permitted Acquisition or other Investment in an aggregate principal amount
at any time outstanding for all such Indebtedness not to exceed $75,000,000 or
(B) in aggregate principal amount at any time outstanding for all other such
Indebtedness not to exceed $35,000,000) has a final maturity date no earlier
than the date that is 18091 days following the Maturity Date, and (C)iii) in the
case of any secured Indebtedness, the Liens securing such additional
Indebtedness shall be subject to the Intercreditor Agreement.;

(u) Indebtedness of Restricted Subsidiaries that are not Loan Parties; provided
that the aggregate principal amount at any time outstanding of such Indebtedness
shall not exceed the greater of (i) $30,000,000 and (ii) 3.0% of Consolidated
Total Assets; and

(v) with respect to Holdings, (i) Guarantees of Indebtedness described in clause
(t) above and (ii) Qualified Holdings Debt.

The accrual of interest, the accretion of accreted value, the accretion or
amortization of original issue discount and the payment of interest in the form
of additional Indebtedness (including any payment-in-kind interest) shall not be
deemed to be an incurrence of Indebtedness for purposes of this Section 6.01.

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

(a) Liens created pursuant to any Loan Document;

(b) Permitted Encumbrances;

(c) any Lien on any property or asset of any Borrower or any Restricted
Subsidiary existing on the date hereof and set forth in Schedule 6.02; provided
that (i) such Lien shall not apply to any other property or asset of such
Borrower or Restricted Subsidiary and (ii) such Lien shall secure only those
obligations which it secures on the date hereof and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof;

(d) Liens on fixed or capital assets acquired, constructed or improved by any
Loan Party or any Restricted Subsidiary; provided that (i) such Liens secure
Indebtedness permitted by Section 6.01(g), (ii) such Liens and the Indebtedness
secured thereby are incurred prior to or within 180 days after

 

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such acquisition or the completion of such construction or improvement,
(iii) the Indebtedness secured thereby does not exceed 100% of the cost of
acquiring, constructing or improving such fixed or capital assets and (iv) such
Liens shall not apply to any other property or assets of such Loan Party, any
other Loan Party or any other Restricted Subsidiary;

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

(f) Liens of a collecting bank arising in the ordinary course of business under
Section 4-210 of the Uniform Commercial Code in effect in the relevant
jurisdiction covering only the items being collected upon;

(g) Liens arising out of sale and leaseback transactions permitted by
Section 6.06;

(h) Liens granted by a Subsidiary that is not a Loan Party in favor of any
Borrower or another Loan Party in respect of Indebtedness owed by such
Subsidiary;

(i) Liens arising from precautionary UCC-1 financing statements;

(j) Liens that are (i) contractual rights of set-off relating to deposit
accounts in favor of banks and other depositary institutions in the ordinary
course of business or (ii) contractual rights of set-off or charge back in favor
of credit card processors arising in the ordinary course of business under
credit card processing agreements;

(k) Liens securing obligations in respect of trade-related letters of credit
permitted to be incurred under Section 6.01(n), which Liens shall cover only the
goods (or the documents of title in respect of such goods) financed by such
letters of credit and the proceeds and products thereof;

(l) Liens in respect of Indebtedness permitted to be incurred pursuant to (i) a
refinancing of Indebtedness under SectionSections 6.01(b), (t) and
(ii) Indebtedness under Section 6.01(tv)(i); provided, that, in each case, such
Liens are subject to the Intercreditor Agreement or another intercreditor
agreement satisfactory to the Administrative Agent; and

(m) Liens created in the ordinary course of business in favor of banks and other
financial institutions over credit balances of any bank accounts of any Foreign
Subsidiary held at such banks or financial institutions, as the case may be, to
facilitate the operation of Cash Pooling Arrangements and/or interest set-off
arrangements in respect of such bank accounts in the ordinary course of
business; and

(n) other Liens on assets not constituting Collateral securing Indebtedness or
other obligations in an aggregate principal amount at any time outstanding not
to exceed the greater of $50,000,000 and 5.0% of Consolidated Total Assets as of
the date of the applicable incurrence; provided that, upon the request of the
Administrative Agent, the applicable Loan Party shall use commercially
reasonable efforts to provide an access agreement, in form and substance
reasonably satisfactory to the Administrative Agent, with respect to any
Collateral located on or about any assets secured by Liens permitted pursuant to
this clause (n).

 

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Notwithstanding the foregoing, none of the Liens permitted pursuant to this
Section 6.02 may at any time attach to any Loan Party’s (1) Accounts, other than
those permitted under clause (a) of the definition of Permitted Encumbrance and
clauses (a) and (l) above and (2) Inventory, other than those permitted under
clauses (a) and (b) of the definition of Permitted Encumbrance and clauses
(a) and (l) above.

SECTION 6.03 Fundamental Changes. (a) No Loan Party will, nor will it permit any
Restricted Subsidiary to, merge into or consolidate with any other Person, or
permit any other Person to merge into or consolidate with it, or liquidate or
dissolve, except that, if at the time thereof and immediately after giving
effect thereto no Event of Default shall have occurred and be continuing (i) any
Borrower may merge with and into another Borrower, (ii) any Subsidiary that is a
Loan Guarantor (other than a Borrower) may merge or liquidate into any Borrower
or any other Subsidiary that is a Loan Guarantor, (iii) any Subsidiary that is
not a Loan Party may merge or liquidate into any other Subsidiary that is not a
Loan Party or into a Loan Party; provided that any such merger involving a
Person that is not a wholly owned Subsidiary immediately prior to such merger
shall not be permitted unless also permitted by Section 6.04, (iv) any
Subsidiary that is not a Loan Party may liquidate or dissolve if the Company
determines in good faith that such liquidation or dissolution is in the best
interests of the Company and is not materially disadvantageous to the Lenders
and (v) any Subsidiary may merge with another Person in any Acquisition
permitted under Section 6.04 provided such other Person is or becomes a
Restricted Subsidiary upon the consummation of such merger and assumes all of
the obligations of merging Subsidiary (if any) under all of the Loan Documents.

(b) No Loan Party will, nor will it permit any of its Restricted Subsidiaries
to, engage to any material extent in any business other than businesses of the
type conducted by the Borrowers and their Subsidiaries on the Effective Date and
any business activities that are similar, related, incidental, complementary or
corollary thereto or a reasonable extension thereof.

(c) Glenwood will not engage in any business or activity other than the
ownership of Equity Interests in Buyers Access and activities incidental
thereto. Glenwood will not own or acquire any assets (other than Equity
Interests in Buyers Access, cash and Permitted Investments) or incur any
liabilities (other than liabilities under the Loan Documents, liabilities in
respect of Guarantees permitted by Section 6.01, liabilities imposed by law,
including Tax liabilities, and other liabilities incidental to its existence and
permitted business and activities).

(d) Holdings will not engage in any business or activity, or own or acquire any
assets or incur any liabilities, other than in connection with (i) the ownership
of all the outstanding Equity Interests in the Company, (ii) the maintenance of
its corporate existence, (iii) the consummation of the Transactions (including
the payment of customary fees and expenses in connection therewith), (iv) the
performance of its obligations under and in connection with the Loan Documents
and the Notes Documents, the Term Loan Documents (or the documentation relating
to any other Term Loans) and the Holdings Notes Documents, and repaying or
redeeming, or otherwise terminating or retiring, the Indebtedness governed by
such documentation (including the Term Loans and the Holdings Notes) in
accordance with the terms thereof, (v) the consummation of any offering of its
Equity Interests permitted under the terms of this Agreement (including the
payment of customary fees and expenses in connection therewith), (vi) the
issuance, whether or not consummated, of Indebtedness, permitted under
Section 6.01, (vii) the ordinary course grant of common stock to employees and
directors pursuant to the terms of any employee benefit or stock option plan,
and (viii) investments in its subsidiaries as permitted by Sections 6.01 and
6.04.

 

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

(a) cash and Permitted Investments, provided that such Permitted Investments
owned by a Loan Party are subject to control agreements in favor of the
Administrative Agent for the benefit of the Secured Parties or otherwise subject
to a perfected security interest in favor of the Administrative Agent for the
benefit of the Secured Parties, in each case to the extent required in the
Security Agreement;

(b) investments in existence on the date of this Agreement and described in
Schedule 6.04 including any amendments, modifications, restatements, renewals or
supplements thereof that do not involve the provision of any new consideration
by any Loan Party or any Restricted Subsidiary;

(c) investments by Holdings in the Borrowers and by the Borrowers and the
Restricted Subsidiaries in any Restricted Subsidiaries; provided that (i) the
aggregate amount of investments by Loan Parties in Restricted Subsidiaries that
are not Loan Parties (together with outstanding Guarantees permitted under the
proviso to Section 6.04(d)) shall not exceed $30,000,000 at any time outstanding
(in each case determined without regard to any write-downs or write-offs),
(ii) any such investments in the form of loans and advances made by (A) a Loan
Party to another Loan Party shall be evidenced by the Intercompany Note, (B) a
Restricted Subsidiary that is not a Loan Party to a Loan Party shall be
subordinated to the Secured Obligations on terms and conditions satisfactory to
the Administrative Agent, and (C) a Loan Party to a Restricted Subsidiary that
is not a Loan Party shall be evidenced by a promissory note pledged pursuant to
the Security Agreement and (iii) any such investments in the form of Equity
Interests (other than Equity Interests in Excluded Subsidiaries (A) described in
clause (c) of the definition thereof and (B) described in clause (a) of the
definition thereof to the extent that the constituent documents of such Excluded
Subsidiaries prohibit the granting of Liens thereon) shall be pledged pursuant
to the Security Agreement;

(d) Guarantees constituting Indebtedness permitted by Section 6.01; provided
that the aggregate principal amount of Indebtedness of Subsidiaries that are not
Loan Parties that is Guaranteed by any Loan Party shall (together with
outstanding investments permitted under clause (i) to the proviso to
Section 6.04(c)) shall not exceed the greater of $30,000,000 at any time
outstandingand 3.0% of Consolidated Total Assets (in each case determined
without regard to any write-downs or write-offs);

(e) Guarantees by Holdings or any other Loan Party of the obligations of the
Company or any of its Restricted Subsidiaries under leases (other than Capital
Leases or sale leasebacks) or contracts and other obligations that, in each
case, do not constitute Indebtedness and are entered into in the ordinary course
of business;

(f) loans or advances made by a Loan Party to its officers, directors and
employees on an arms’-length basis (i) in the ordinary course of business
consistent with past practices for travel and entertainment expenses, relocation
costs and similar purposes and (ii) in connection with such Person’s purchase of
Equity Interests of Holdings or any Parent to the extent that the amount of such
loans or advances are contributed to Holdings in cash, the aggregate principal
amount of such loans and advances outstanding at any one time not to exceed
$10,000,000;

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

 

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(h) (i) extensions of trade credit in the ordinary course of business,
(ii) investments in the ordinary course of business consisting of Article 3 or
Article 4 endorsements for collection or deposit, and (iii) advances of payroll
payments to employees in the ordinary course of business;

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

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

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

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

(m) any investment (including a Permitted Acquisition) to the extent that
payment for such investment is made solely with, or with the cash proceeds of
the issuance of, Equity Interests of Holdings (other than Disqualified Stock) or
with the cash proceeds of capital contributions to Holdings from the holders of
its Equity Interests, in each case which are designated as being for the purpose
of making such investment by written notice to the Administrative Agent;

(n) 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;

(o) investments made to repurchase or retire Equity Interests of Holdings owned
by directors, officers or employees or any employee stock ownership plan of the
Company (or any direct or indirect parent thereof) to the extent permitted by
Section 6.08; and

(p) Permitted Acquisitions and other investments (any such Permitted Acquisition
or other investment being made pursuant to this clause (p), a “Specified
Investment”); provided that on the date of such Specified Investment (i) no
Default or Event of Default then exists of would result therefrom and (ii) after
giving effect thereto on a pro forma basis either (A) both (1) Availability is
greater than the higher of 10% of the Commitments and $25,000,000 and (2) the
Fixed Charge Coverage Ratio for the period of four consecutive fiscal quarters
ending on the last day of the most recent fiscal quarter or fiscal year for
which financial statements have been delivered pursuant to Section 5.01(a) or
(b), as applicable, is greater than 1.0 to 1.0 or (B) Availability is greater
than the higher of 15% of the Commitments and $37,500,000; provided further that
if the test in clause (p)(ii) for Specified Investments is not satisfied, then
any Loan Party shall be permitted to make Specified Investments in an amount
which, when aggregated with all prior Specified Investments made under this
clause (p) that did not satisfy the test in clause (p)(ii), does not exceed
$15,000,00025,000,000 so long as, after giving pro forma effect to the Specified
Investments as of the date thereof, (I) no Default or Event of Default then
exists or would result therefrom and (II) either (x) the Fixed Charge Coverage
Ratio is greater than 1.0 to 1.0 or (y) Availability is greater than the higher
of 10% of the Commitments and $25,000,000.

 

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Notwithstanding anything herein to the contrary, no Acquisition shall be
permitted to be made under this Section 6.04 unless such Acquisition constitutes
a Permitted Acquisition.

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

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

(b) the Company or any Restricted Subsidiary may (i) effect any transaction
permitted by Section 6.03, Section 6.04 and Section 6.08(a) or (ii) incur any
Lien permitted under Section 6.02;

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

(d) sales, transfers and dispositions of Permitted Investments and other
investments permitted by clauses (j), (k) and (n) of Section 6.04;

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

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

(g) sales, transfers and other dispositions of assets (other than Equity
Interests in a Restricted Subsidiary unless all Equity Interests held in such
Subsidiary are sold) that are not permitted by any other paragraph of this
Section having a value of up to the sum of $10,000,00015,000,000 per fiscal year
in the aggregate; provided, that such sales, transfers and other dispositions
may exceed $10,000,00015,000,000 per fiscal year if and to the extent that,
after giving pro forma effect thereto, (i) no Default or Event of Default then
exists or would result therefrom, (ii) Availability is greater than $75,000,000,
and (iii) the Fixed Charge Coverage Ratio is greater than 1.15 to 1.00;

(h) sales, transfers and dispositions of (i) the Specified Properties and
(ii) Glenwood’s Equity Interests in Buyer’s Access;

(i) the Company and any Restricted Subsidiary may lease, sublease, license or
sublicense (on a non-exclusive basis with respect to any intellectual property)
real, personal or intellectual property in the ordinary course of business;

(j) the Company and any Restricted Subsidiary may make sales, transfers and
other dispositions of property (other than Inventory if an Event of Default has
occurred and is continuing) to the extent that (i) such property is exchanged
for credit against the purchase price of similar replacement property or
(ii) the proceeds of such sales, transfers and other dispositions are promptly
applied to the purchase price of such replacement property;

(k) the Company and any Restricted Subsidiary may make sales, transfers and
other dispositions of investments in joint ventures to the extent required by,
or made pursuant to customary buy/sell arrangements between, the joint venture
parties set forth in joint venture arrangements and similar binding
arrangements; and

 

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(l) the Company and any Restricted Subsidiary may sell, transfer or otherwise
dispose of, or issue Equity Interests in, Restricted Subsidiaries so long as,
after giving effect thereto, (i) the Company or a Restricted Subsidiary
continues to have an Equity Interest in such Person, (ii) the total assets of
all non-wholly owned Persons that are or were Restricted Subsidiaries, as
reflected on their most recent balance sheets prepared in accordance with GAAP,
do not in the aggregate at any time exceed $7,500,000, and (iii) the total
revenues of all non-wholly owned Persons that are or were Restricted
Subsidiaries, for the twelve-month period ending on the last day of the most
recent period for which financial statements have been delivered pursuant to
Section 5.01(a) or (b) do not in the aggregate exceed $7,500,000; and

(m) any sale, transfer or other disposition in a single transaction of fixed
assets having a value that does not exceed $2,500,000;

provided that all sales, transfers, leases and other dispositions permitted
hereby (other than (x) those permitted by clauses (b), (f), (i), (j) and
(k) above, (k) and (m) above and (y) any sale, transfer, lease or other
disposition of Notes Priority Collateral (as defined in the Intercreditor
Agreement) having a value not exceeding $5,000,000) shall be made for fair value
and for at least 75% cash consideration; provided further, that:

(A) any liabilities of any Borrower or any Restricted Subsidiary, other than
liabilities that are by their terms subordinated to the payment in cash of the
Obligations, that are assumed by the transferee with respect to the applicable
disposition and for which such Borrower and all of the Restricted Subsidiaries
shall have been validly released by all applicable creditors in writing,

(B) any securities received by such Borrower or such Restricted Subsidiary from
such transferee that are converted by such Borrower or such Restricted
Subsidiary into cash (to the extent of the cash received) within 90 days
following the closing of the applicable disposition, and

(C) other than with respect to a disposition of Collateral of the types included
in the Borrowing Base, any Designated Non-Cash Consideration received by the
Borrowers or their Restricted Subsidiaries in respect of such disposition having
an aggregate fair market value, taken together with all other Designated
Non-Cash Consideration received pursuant to clause (C) that is at that time
outstanding, not in excess of the greater of $25,000,00030,000,000 and 2.53.0%
of Consolidated Total Assets at the time of the receipt of such Designated
Non-Cash Consideration, with the fair market value of each item of Designated
Non-Cash Consideration being measured at the time received and without giving
effect to subsequent changes in value,

shall be deemed to be cash.

SECTION 6.06 Sale and Leaseback Transactions. No Loan Party will, nor will it
permit any Restricted Subsidiary to, enter into any arrangement, directly or
indirectly, whereby it shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereafter acquired, and
thereafter rent or lease such property or other property that it intends to use
for substantially the same purpose or purposes as the property sold or
transferred, except for (a) any such sale of any fixed or capital assets by any
Borrower or any Restricted Subsidiary that (i) is made for cash consideration in
an amount not less than the fair value, as determined at the time of
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Subsidiary, of such fixed or capital asset and, (ii) is consummated within 90180
days after such Borrower or such Restricted Subsidiary acquires or completes the
construction of such fixed or capital asset and (iii) the Indebtedness
associated therewith is otherwise permitted under Section 6.01(g), (b) any
transaction involving the Specified Properties and (c) any such transaction
(i) that is made for cash consideration, (ii) under which the applicable Loan
Party or Restricted Subsidiary would otherwise be permitted to enter into, and
remain liable under, the applicable underlying lease and (iii) having a fair
market value that, together with the fair market value of all other assets sold
subject to all transactions under this clause (c), would not exceed the greater
of $40,000,000 and 4.0% of Consolidated Total Assets.

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

SECTION 6.08 Restricted Payments; Certain Payments of Indebtedness.

(a) No Loan Party will, nor will it permit any Restricted Subsidiary to, declare
or make, or agree to pay or make, directly or indirectly, any Restricted
Payment, or incur any obligation (contingent or otherwise) to do so, except:

(i) each of Holdings and each Restricted Subsidiary may declare and pay
dividends with respect to its common stock payable solely in additional shares
of its common stock;

(ii) Restricted Subsidiaries of Holdings may declare and pay dividends to
Holdings or a Restricted Subsidiary of Holdings or otherwise ratably with
respect to their Equity Interests; provided that, so long as the Administrative
Agent does not have a Lien on substantially all assets of Holdings, dividends
shall not be paid to Holdings unless such dividends are (A) for one or more of
the purposes permitted by sub-clauses (iii), (iv) or (vi) of this
Section 6.08(a) (and are promptly applied for such purposes), (B) used to make
payments on or with respect to the Holdings Notes or (C) are for other general
costs and expenses incurred by Holdings, including to make payments of the types
referred to in the definition of “Permitted Payments to Parent” to the extent
that such payments are required to be made by Holdings;

(iii) Holdings may make payments pursuant to and in accordance with stock option
plans or other benefit plans for management or employees of Holdings, the
Borrowers and their Restricted Subsidiaries in an aggregate amount not to exceed
$7,500,00010,000,000 during any fiscal year; provided, that such amounts will be
increased by (A) the amount of any net cash proceeds received by or contributed
to Holdings from the issuance and sale since the Effective Date of Equity
Interests (other than Disqualified Stock) of Holdings or any Parent to its
officers, directors or employees, plus (B) the cash proceeds of key man life
insurance policies received by Holdings, its Restricted Subsidiaries or any
Parent and contributed to Holdings;

(iv) Holdings may make Permitted Payments to Parent;

 

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(v) Holdings may make the Specified Distribution on the Effective Date; provided
that (A) Availability is greater than 20% of the Commitments before and after
giving effect thereto and to all Borrowings made and all issuances (or deemed
issuances) of Letters of Credit on the Effective Date and (B) the aggregate
amount of the proceeds of the Revolving Loans used to make the Specified
Distribution, together with any other Revolving Loans used for the purposes
described in Section 5.08(a), does not exceed $110,000,000;

(vi) after the Effective Date, Holdings may declare or make other Restricted
Payments, if, after giving pro forma effect thereto, either (A) both
(1) Availability is greater than the higher of 15% of the Commitments and
$37,500,000 and (2) the Fixed Charge Coverage Ratio for the period of four
consecutive fiscal quarters ending on the last day of the most recent fiscal
quarter or fiscal year for which financial statements have been delivered
pursuant to Section 5.01(a) or (b), as applicable, is greater than 1.0 to 1.0 or
(B) Availability is greater than the higher of 20% of the Commitments and
$50,000,000;

(vii) Holdings may redeem in whole or in part any of its Equity Interests for
another class of Equity Interests or with proceeds from substantially concurrent
equity contributions or issuances of new Equity Interests; provided that such
new Equity Interests contain terms and provisions at least as advantageous to
the Lenders in all respects material to their interests as those contained in
the Equity Interests redeemed thereby and are not Disqualified Stock.

Notwithstanding clause (vi) above, if following the Effective Date Holdings
makes any payments permitted or required under the Merger Agreement in respect
of dissenting stockholders’ rights, stock options, restricted stock and
restricted share units or deferred stock, the aggregate amount of the proceeds
of the Revolving Loans used to make such Restricted Payments, together with any
other Revolving Loans used for the purposes described in Section 5.08(a), shall
not exceed $110,000,000.

(b) No Loan Party will, nor will it permit any Restricted Subsidiary to, make or
agree to pay or make, directly or indirectly, any payment or other distribution
(whether in cash, securities or other property) of or in respect of principal of
or interest on any Junior Indebtedness, or any payment or other distribution
(whether in cash, securities or other property), including any sinking fund or
similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any Junior Indebtedness
(collectively, “Restricted Debt Payments”), except:

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

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

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

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

 

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(iv) payments as part of an “applicable high yield discount obligation” catch-up
payment;

(v) (A) Restricted Debt Payments in exchange for, or with proceeds of any
issuance of Equity Interests of, any Parent or Equity Interests (that do not
constitute Disqualified Capital Stock) of Holdings, and/or with the proceeds of
any capital contribution in respect of Equity Interests (that do not constitute
Disqualified Capital Stock) of Holdings, (B) Restricted Debt Payments as a
result of the conversion of all or any portion of Restricted Debt into Equity
Interests (that do not constitute Disqualified Capital Stock) of any Parent or
Holdings and (C) to the extent constituting a Restricted Debt Payment,
payment-in-kind interest with respect to any Restricted Debt that is permitted
under Section 6.01; and

(vi) (v) if, after giving effect thereto, either (A) both (1) Availability is
greater than the higher of 1512.5% of the Commitments and $37,500,00031,250,000
and (2) the Fixed Charge Coverage Ratio for the period of four consecutive
fiscal quarters ending on the last day of the most recent fiscal quarter or
fiscal year for which financial statements have been delivered pursuant to
Section 5.01(a) or (b), as applicable, (calculated on a pro forma basis treating
such prepayment, redemption, repurchase or retirement, together with all other
prepayments, redemptions, repurchases and retirements of Indebtedness made
pursuant to this clause (vvi), as Fixed Charges) is greater than 1.0 to 1.0 or
(B) Availability is greater than the higher of 2017.5% of the Commitments and
$50,000,000,43,750,000, Holdings and its Restricted Subsidiaries may prepay,
redeem, repurchase or retire any Junior Indebtedness of Holdings, the Company or
any of its Restricted Subsidiaries (including any premium (if any) and accrued
and unpaid interest thereon to the date of such repayment, redemption,
repurchase or retirement).

SECTION 6.09 Transactions with Affiliates. No Loan Party will, nor will it
permit any Restricted Subsidiary to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property or
assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) transactions that (i) are in the ordinary course of
business and (ii) are at prices and on terms and conditions not less favorable
to such Loan Party or such Restricted Subsidiary than could be obtained on an
arm’s-length basis from unrelated third parties, (b) transactions between or
among Loan Parties not involving any other Affiliate, (c) any investment
permitted by Section 6.04(c), (d) or (e), (d) any Indebtedness permitted under
Section 6.01(e), (e) any Restricted Payment permitted by Section 6.08, (f) loans
or advances to employees permitted under Section 6.04, (g) the payment of
reasonable fees to directors of any Borrower or any Restricted Subsidiary who
are not employees of such Borrower or Restricted Subsidiary, and compensation
and employee benefit arrangements paid to, and indemnities provided for the
benefit of, directors, officers or employees of the Borrowers or the Restricted
Subsidiaries in the ordinary course of business, (h) compensation and
reimbursement of expenses of officers and directors of any Loan Party, including
the issuance of Equity Interests of Holdings, in each case in the ordinary
course of business, (i) any issuances of securities or other payments, awards or
grants in cash, securities or otherwise pursuant to, or the funding of,
employment agreements, stock options and stock ownership plans approved by a
Borrower’s board of directors, (j) any sale or disposition of inventory by any
Borrower or any Restricted Subsidiary to wholly owned Foreign Subsidiaries in
the ordinary course of business, at a price not less than the cost of such
inventory, (k) the entering into of a tax sharing agreement, or payments
pursuant thereto, between Holdings and one or more Subsidiaries, on the one
hand, and any other Person with which Holdings and such Subsidiaries are
required to file a consolidated tax return or with which Holdings and such
Subsidiaries are part of a consolidated group for tax purposes, on the other
hand, (l) other than during the continuance of an Event of Default, the payment
to the Sponsors of management, monitoring and consulting fees and expenses, not
to exceed $5,000,000 in any four quarter

 

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period, (m) the payment of transaction fees and related expenses paid to the
Sponsors in connection with acquisitions, dispositions, recapitalizations,
refinancings and extraordinary transactions for such period, not to exceed (net
of reimbursable expenses) 1% of the transaction value for any such transaction
and (n) payments by Holdings or any Restricted Subsidiary of Holdings to any of
the Sponsors made for any financial advisory, financing, underwriting or
placement services or in respect of other investment banking activities,
including, without limitation, in connection with acquisitions or divestitures
which payments are approved by a majority of the board of directors of Holdings
in good faith and are at prices and on terms and conditions not less favorable
to Holdings or such Restricted Subsidiary than could be obtained on an
arm’s-length basis from unrelated third parties.

SECTION 6.10 Restrictive Agreements. No Loan Party will, nor will it permit any
Restricted Subsidiary to, directly or indirectly, enter into, incur or permit to
exist any agreement or other arrangement that prohibits, restricts or imposes
any condition upon (a) the ability of such Loan Party or any of its Restricted
Subsidiaries to create, incur or permit to exist any Lien upon any of its
property or assets other than Permitted Encumbrances, or (b) the ability of any
Restricted Subsidiary to pay dividends or other distributions with respect to
its Equity Interests or to make or repay loans or advances to any Borrower or
any other Restricted Subsidiary or to Guarantee Indebtedness of any Borrower or
any other Restricted Subsidiary; provided that (i) the foregoing shall not apply
to restrictions and conditions imposed by law or by any Loan Document, any
Company NotesTerm Loan Document (and any amendments, restatements, supplements
or other modifications thereto to the extent such restrictions or conditions are
no more restrictive than those with respect to the Company Notes on the date
hereofTerm Loan Closing Date) or any Holdings Notes Document (and any
amendments, restatements, supplements or other modifications thereto to the
extent such restrictions or conditions are no more restrictive than those with
respect to the Holdings Notes on the date hereof), (ii) the foregoing shall not
apply to restrictions and conditions existing on the date hereof identified on
Schedule 6.10 (but shall apply to any extension or renewal of, or any amendment
or modification expanding the scope of, any such restriction or condition),
(iii) the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to the sale of a Restricted Subsidiary pending
such sale, provided such restrictions and conditions apply only to the
Restricted Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by
Section 6.01(g), (l) or (t) of this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness; provided that
any such agreements relating to secured Indebtedness permitted by
Section 6.01(t) shall not prohibit the Liens securing the Secured Obligations
and (v) clause (a) of the foregoing shall not apply to (x) customary provisions
in leases and other contracts restricting the assignment or subletting thereof
or (y) customary restrictions on dispositions of real property interests found
in reciprocal easement agreements of such Loan Party or any of its Restricted
Subsidiaries.

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

SECTION 6.12 Fixed Charge Coverage Ratio. The Borrowers will not permit the
Fixed Charge Coverage Ratio for each period of four consecutive fiscal quarters
ending during or on the date last reported before any Covenant Trigger Period to
be less than 1.00 to 1.00 (determined as of the last day of the most recent
fiscal quarter for which a Compliance Certificate has been or should have been
delivered pursuant to Section 5.01(c)).

 

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ARTICLE VII

EVENTS OF DEFAULT

SECTION 7.01 Events of Default. If any of the following events (“Events of
Default”) shall occur:

(a) the Borrowers shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise;

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

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

(d) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in Section 5.01(e), 5.02(a), 5.03 (with respect to a Loan
Party’s existence), 5.08 or 5.14 or in Article VI;

(e) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in this Agreement (other than those which constitute a
default under another Section of this Article), and such failure shall continue
unremedied for a period of (i) five (5) days after the earlier of any Loan
Party’s knowledge of such breach or notice thereof from the Administrative Agent
(which notice will be given at the request of any Lender) if such breach relates
to terms or provisions of Section 5.01 (except as set forth above), 5.02 (other
than Section 5.02(a)), 5.03 (except as set forth above) through 5.07, 5.09, or
5.12 of this Agreement or (ii) thirty (30) days after the earlier of any Loan
Party’s knowledge of such breach or notice thereof from the Administrative Agent
(which notice will be given at the request of any Lender) if such breach relates
to terms or provisions of any other Section of this Agreement;

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

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

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

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

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

(k) one or more judgments for the payment of money in an aggregate amount in
excess of $20,000,00035,000,000 (in excess of insurance provided by reputable
providers for which coverage has not been disclaimed) shall be rendered against
any Loan Party, any Restricted Subsidiary of any Loan Party or any combination
thereof and the same shall remain undischarged for a period of 30 consecutive
days during which execution shall not be effectively stayed, or any action shall
be legally taken by a judgment creditor to attach or levy upon any assets of any
Loan Party or any Restricted Subsidiary of any Loan Party to enforce any such
judgment or any Loan Party or any Restricted Subsidiary of any Loan Party shall
fail within 30 days to discharge one or more non-monetary judgments or orders
which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, which judgments or orders, in any such case, are not
stayed on appeal or otherwise being appropriately contested in good faith by
proper proceedings diligently pursued;

(l) an ERISA Event shall have occurred that, when taken together with all other
ERISA Events that have occurred, couldwould reasonably be expected to result in
liability of the Borrowers and the Restricted Subsidiaries in an aggregate
amount exceeding $20,000,000 for all periodsa Material Adverse Effect;

(m) a Change in Control shall occur;

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

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

 

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respect to a Loan Guaranty provided by an Immaterial Subsidiary and shall
continue unremedied for a period of at least 5 Business Days after receipt of
written notice to the Borrower Representative from the Administrative Agent or
the Required Lenders);

(p) any Collateral Document shall for any reason fail to create a valid and
perfected first priority security interest in any Collateral purported to be
covered thereby, except as permitted by the terms of any Collateral Document, or
any Collateral Document shall fail to remain in full force or effect or any
action shall be taken by any Loan Party to discontinue or to assert the
invalidity or unenforceability of any Collateral Document, or any Loan Party
shall fail to comply with any of the terms or provisions of any Collateral
Document (or any of the foregoing shall occur with respect to Collateral
provided by an Immaterial Subsidiary and shall continue unremedied for a period
of at least 5 Business Days after receipt of written notice to the Borrower
Representative from the Administrative Agent or the Required Lenders); or

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

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

SECTION 7.02 Right to Cure.

(a) Notwithstanding anything to the contrary contained in Section 7.01(d), in
the event that the Borrowers fail to comply with the requirements of the
covenant set forth in Section 6.12 for any period, until the expiration of
(1) with respect to a breach of such covenant that occurs on the first day of
the Covenant Trigger Period, the date that is 10 days after such date or
(2) otherwise, the tenth (10th) day after the date on which financial statements
with respect to the relevant period for which the Fixed Charge Coverage Ratio is
being measured are required to be delivered pursuant to Section 5.01(c) (the
“Cure Period”), Holdings shall have the right to obtain a cash equity
contribution (funded with proceeds of Equity Interests that are not Disqualified
Stock issued by Holdings or other equity issued by Holdings having terms
reasonably acceptable to the Administrative Agent) (the “Cure Right”), and upon
the receipt by Holdings of net cash proceeds pursuant to the exercise of the
Cure Right (including through the capital contribution of

 

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any such net cash proceeds to Holdings, the “Specified Equity Contribution”),
the Fixed Charge Coverage Ratio shall be recalculated, giving effect to a pro
forma increase to EBITDA for such period in an amount equal to such net cash
proceeds; provided that such pro forma adjustment to EBITDA shall be made solely
for the purpose of determining the existence of a Default or an Event of Default
under the covenant set forth in Section 6.12 with respect to any period that
includes the fiscal quarter for which such Cure Right was exercised and not for
any other purpose under any Loan Document; provided, further, that until the
expiration of the Cure Period, (i) neither the Administrative Agent nor any
Lender shall have the right to exercise any remedies against the Loan Parties or
any Collateral as a result of the occurrence and continuance of an Event of
Default under Section 7.01(d) arising from the failure to comply with
Section 6.12, and then only if a Cure Right to remedy such Event of Default is
available at such time under Section 7.02(b) and (ii) no Borrower shall have the
right to any Borrowings.

(b) If, after the exercise of the Cure Right and the recalculations pursuant to
clause (a) above, the Loan Parties shall then be in compliance with the
requirements of the covenant set forth in Section 6.12 (including for purposes
of Section 4.02), the Borrowers shall be deemed to have satisfied the
requirements of such covenant as of the relevant date of determination with the
same effect as though there had been no failure to comply therewith at such
date, and the applicable Default or Event of Default under Section 7.01(d) that
had occurred shall be deemed cured; provided that (i) in each four fiscal
quarter period, there shall be at least two fiscal quarters in which the Cure
Right is not exercised, (ii) there shall be no more than five Specified Equity
Contributions during the term of this Agreement, (iii) with respect to any
exercise of the Cure Right, the Specified Equity Contribution shall be no
greater than the amount required to cause the Borrowers to be in compliance with
the covenant set forth in Section 6.12 and (iv) all Specified Equity
Contributions will be disregarded for purposes of determining the availability
of any baskets or carve-outs with respect to the covenants contained in Article
VI hereof or for any other purpose.

ARTICLE VIII

THE ADMINISTRATIVE AGENT

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

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

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

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

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

Subject to the appointment and acceptance of a successor Administrative Agent as
provided in this paragraph, the Administrative Agent may resign at any time by
notifying the Lenders, the Issuing Banks and the Borrower Representative. Upon
any such resignation, the Required Lenders shall have the right, with the
Company’s consent (not to be unreasonably withheld or delayed), to appoint a
successor. If no successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 30 days after the retiring
Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may, on behalf of the Lenders and the Issuing Banks,
appoint a successor Administrative Agent which shall be a commercial bank or an
Affiliate of any such commercial bank. Upon the acceptance of its appointment as
Administrative Agent hereunder by a successor, such successor shall succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. The fees payable by the
Borrowers to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrowers and such
successor. After the Administrative Agent’s resignation hereunder, the
provisions of this Article, Section 2.17(d) and Section 9.03 shall continue in
effect for the benefit of such retiring Administrative Agent, its sub-agents and
their respective Related Parties in respect of any actions taken or omitted to
be taken by any of them while it was acting as Administrative Agent.

 

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

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

Each Lender, Lead Arranger or Affiliate of a Lender or Lead Arranger that enters
into an agreement to provide Banking Services or a Swap Agreement with any Loan
Party and intends for the Banking Services Obligations or the Swap Obligations,
as applicable, resulting therefrom to constitute Secured Obligations, by
delivery of a notice to the Administrative Agent pursuant to the requirements
set forth in the definition of “Secured Obligations”, agrees to be bound by
Section 2.18(b) and this Article VIII. Each such Lender, Lead Arranger or
Affiliate of a Lender or Lead Arranger shall indemnify and hold harmless the
Administrative Agent and its Related Parties, to the extent not reimbursed by
the Loan Parties, against all claims, liabilities, obligations, losses, damages,
penalties, judgments, proceedings, interest, costs and expenses of any kind
(including remedial response costs, reasonable attorneys’ fees and all costs,
expenses or advances that the Administrative Agent may incur during a Default,
or during the pendency of a bankruptcy or insolvency proceeding of any Loan
Party) at any time (including after (a) the Commitments have expired or
terminated and the principal of and interest on each Loan and all fees, expenses
and other amounts payable under any Loan Document have been paid in full and all
Letters of Credit have expired, been cash collateralized, backstopped or
terminated and all LC Disbursements shall have been reimbursed or (b) the
replacement of the Administrative Agent or any Lender) that may be incurred by
or asserted against the Administrative Agent or any of its Related Parties in
connection with, or in any way relating to, such Lender’s, such Lead Arranger’s
or such Affiliate’s applicable Banking Services Obligations or Swap Obligations;
provided that such indemnity shall not be available to the extent such claims,
liabilities, obligations, losses, damages, penalties, judgments, proceedings,
interest, costs and expenses are determined by a court of competent jurisdiction
by a final and nonappealable judgment to have resulted from the bad faith, gross
negligence or willful misconduct of the Administrative Agent or its Related
Parties.

The Joint Bookrunners, Lead Arrangers, the Co-Documentation Agents and the
Syndication Agent shall not have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Lenders as such. To the fullest extent permitted by law, each Lender hereby
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and releases any claims that it may have against the Joint Bookrunners, Lead
Arrangers, the Co-Documentation Agents and the Syndication Agents in their
capacities as such with respect to any breach or alleged breach of agency or
fiduciary duty to such Lender in connection with any aspect of any transaction
contemplated hereby.

ARTICLE IX

MISCELLANEOUS

SECTION 9.01 Notices. (a) Except in the case of notices and other communications
expressly permitted to be given by telephone (and subject to paragraph
(b) below), all notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by facsimile, as follows:

(i) if to any Loan Party, to the Borrower Representative at:

701 San Marco Boulevard

Jacksonville, FL 32207

Attention: Treasurer

Facsimile No: (856) 505-1679

 

with a copy to:      Fried, Frank, Harris, Shriver & Jacobson LLP      One New
York Plaza      New York, NY 10004      Attention: F. William Reindel     
Facsimile No: (212) 859-4000

(ii) if to the Administrative Agent, BofA, as an Issuing Bank or the Swingline
Lender, to Bank of America, N.A. at:

300 Galleria Parkway, Suite 800

Atlanta, Georgia 30339

Attention: John M. Olsen

Telephone No: (404) 607-3218

Facsimile No: (404) 607-3277

Email: john.m.olsen@baml.com

(iii) if to any other Lender, to it at its address or facsimile number set forth
in its Administrative Questionnaire.

All such notices and other communications (i) sent by hand or overnight courier
service, or mailed by certified or registered mail, shall be deemed to have been
given when received or (ii) sent by facsimile shall be deemed to have been given
when sent, provided that if not given during normal business hours for the
recipient, shall be deemed to have been given at the opening of business on the
next Business Day for the recipient.

(b) Notices and other communications to the Lenders hereunder may be delivered
or furnished by electronic communications (including e-mail and internet or
intranet websites) pursuant to procedures approved by the Administrative Agent;
provided that the foregoing shall not apply to notices pursuant to Article II or
default notices unless otherwise agreed by the Administrative Agent and the
applicable Lender. The Administrative Agent or the Borrower Representative (on
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Parties) may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications. All such notices and other
communications (i) sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if not given during the normal business
hours of the recipient, such notice or communication shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient, and (ii) posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail address
as described in the foregoing clause (b)(i) of notification that such notice or
communication is available and identifying the website address therefor.

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

SECTION 9.02 Waivers; Amendments. (a) No failure or delay by the Administrative
Agent, any Issuing Bank or any Lender in exercising any right or power hereunder
or under any other Loan Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Issuing Banks and the Lenders
hereunder and under any other Loan Document are cumulative and are not exclusive
of any rights or remedies that they would otherwise have. No waiver of any
provision of any Loan Document or consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, any Lender or any
Issuing Bank may have had notice or knowledge of such Default at the time.

(b) Neither this Agreement nor any other Loan Document nor any provision hereof
or thereof may be waived, amended or modified except (1) in the case of this
Agreement, pursuant to an agreement or agreements in writing entered into by the
Borrowers and the Required Lenders or, (2) in the case of any other Loan
Document, pursuant to an agreement or agreements in writing entered into by the
Administrative Agent and the Loan Party or Loan Parties that are parties
thereto, with the consent of the Required Lenders; provided that no such
agreement shall (i) increase the Commitment of any Lender without the written
consent of such Lender, (ii) reduce or forgive the principal amount of any Loan
or LC Disbursement or reduce the rate of interest thereon (other than default
interest), or reduce or forgive any interest (other than default interest) or
fees payable hereunder, without the written consent of each Lender directly
affected thereby, (iii) postpone any scheduled date of payment of the principal
amount of any Loan or LC Disbursement, or any date for the payment of any
interest, fees or other Obligations payable hereunder, or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date of expiration
of any Commitment, without the written consent of each Lender directly affected
thereby, (iv) change Section 2.18(b) or (d) in a manner that would alter the
manner in which payments are shared (except such changes that provide for
different interest rates, commitment fees or other fees or separate tranches of
Loans for consenting and non-consenting Lenders, in each case, in connection
with the extension of the Maturity Date), without the written consent of each
Lender, (v) increase any Borrowing Base advance rates without the written
consent of the Supermajority Lenders, (vi) add new categories of eligible assets
to the Borrowing Base or modify that portion of Section 2.01 which limits the
amount that can be borrowed, without the written consent of the Supermajority
Lenders (but a modification to such portion of Section 2.01 that would allow the
amount that can be borrowed to exceed the Commitments shall require the written
consent of each Lender) (vii) change the definition of “Covenant Trigger Period”
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Period” without the written consent of the Supermajority Lenders, (viii) change
any of the provisions of this Section or the definition of “Required Lenders” or
“Supermajority Lenders” or any other provision of any Loan Document specifying
the number or percentage of Lenders (or Lenders of any Class) required to waive,
amend or modify any rights thereunder or make any determination or grant any
consent thereunder, without the written consent of each Lender, (ix) change
Section 2.20, without the consent of each Lender (other than any Defaulting
Lender), (x) release Loan Guarantors from their obligation under the Loan
Guaranty constituting all or substantially all of the value of the guarantees
(except as otherwise permitted herein or in the other Loan Documents), without
the written consent of each Lender, or (xi) except as provided in clause (c) of
this Section or in any Collateral Document, release all or substantially all of
the Collateral or subordinate Agent’s Liens on all or substantially all of the
Collateral, without the written consent of each Lender (it being understood that
amendments to the Intercreditor Agreement shall only require the consent of the
Required Lenders); provided further that no such agreement shall amend, modify
or otherwise affect the rights or duties of the Administrative Agent, any
Issuing Bank or the Swingline Lender hereunder without the prior written consent
of the Administrative Agent, such Issuing Bank or the Swingline Lender, as the
case may be (it being understood that any change to Section 2.20 shall require
the consent of the Administrative Agent, the Swingline Lender and each Issuing
Bank). The Administrative Agent may also amend the Commitment Schedule (A) to
reflect assignments entered into pursuant to Section 9.04 and (B) as permitted
under Section 2.09(g).

(c) The Administrative Agent shall, and is hereby irrevocably authorized and
directed by the Lenders to, release any Liens granted to the Administrative
Agent by the Loan Parties on any Collateral (i) upon the termination of the
Commitments, payment and satisfaction in full in cash of all Secured Obligations
(other than Unliquidated Obligations), and the cash collateralization of all
Unliquidated Obligations in a manner satisfactory to each affected Lender and
Issuing Bank, (ii) constituting property being sold or disposed of in compliance
with the terms of this Agreement and if the Loan Party disposing of such
property so certifies to the Administrative Agent (and the Administrative Agent
may rely conclusively on any such certificate, without further inquiry), and to
the extent that the property being sold or disposed of constitutes any portion
of the Equity Interest of a Restricted Subsidiary, the Administrative Agent is
authorized to release any Loan Guaranty provided by such Restricted Subsidiary,
so long as any Guarantee by such Restricted Subsidiary of the Company Notes is
also released, or (iii) constituting property leased to a Loan Party under a
lease which has expired or been terminated in a transaction permitted under this
Agreement. The Lenders hereby further authorize the Administrative Agent, at its
option and its sole discretion, to release any Liens granted to the
Administrative Agent by the Loan Parties on any Collateral as required to effect
any sale or other disposition of such Collateral in connection with any exercise
of remedies of the Administrative Agent and the Lenders pursuant to
Section 7.01. Except as provided in the preceding sentence, the Administrative
Agent will not release any Liens on Collateral without the prior written
authorization of the Required Lenders; provided that, the Administrative Agent
may in its discretion, release its Liens on Collateral valued in the aggregate
not in excess of $25,000,000 (but not in excess of $10,000,000 with respect to
Collateral of a type included in the Borrowing Base) during any calendar year
without the prior written authorization of the Required Lenders. Any such
release shall not in any manner discharge, affect, or impair the Obligations or
any Liens (other than those expressly being released) upon (or obligations of
the Loan Parties in respect of) all interests retained by the Loan Parties,
including the proceeds of any sale, all of which shall continue to constitute
part of the Collateral. In connection with any termination or release pursuant
to this Section, the Administrative Agent shall reasonably promptly execute and
deliver to any Loan Party, at such Loan Party’s expense, all documents that such
Loan Party shall reasonably request to evidence such termination or release.
Provided that no Default has occurred and is continuing, the Lenders also hereby
irrevocably authorize the Administrative Agent to (A) enter into the
Intercreditor Agreement (with such immaterial changes to the form set forth on
Exhibit I as the Administrative Agent may deem appropriate) and (B) subordinate
its Liens on the Notes Priority Collateral (as defined in Exhibit I) to Liens
permitted under Section 6.02(l).

 

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

SECTION 9.03 Expenses; Indemnity; Damage Waiver. (a) The Borrowers shall pay
(i) all reasonable out-of-pocket expenses incurred by the Administrative Agent,
each Lead Arranger and their respective Affiliates (the “Agent/Arranger
Persons”), including the reasonable fees, charges and disbursements of one
counsel for the Agent/Arranger Persons and to the extent necessary, one special
or local counsel in each appropriate jurisdiction (absent a conflict of
interest, in which case the Agent/Arranger Persons may engage and be reimbursed
for additional counsel), in connection with the syndication and distribution
(including, without limitation, via the internet or through a service such as
Intralinks) of the credit facilities provided for herein, the preparation and
administration of the Loan Documents or any amendments, modifications or waivers
of the provisions of the Loan Documents and in connection with the enforcement,
collection or protection of its rights in connection with the Loan Documents,
including its rights under this Section, or in connection with the Loans made or
Letters of Credit issued hereunder, including all such out-of-pocket expenses
incurred during any workout, restructuring or negotiations in respect of such
Loans or Letters of Credit (whether or not the transactions contemplated hereby
or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses
incurred by any Issuing Bank in connection with the issuance, amendment, renewal
or extension of any Letter of Credit or any demand for payment thereunder and
(iii) all out-of-pocket expenses incurred by any Issuing Bank or any Lender
during the continuance of an Event of Default, including the fees, charges and
disbursements of one counsel for the Issuing Bank and the Lenders and to the
extent necessary, one special or local counsel in each appropriate jurisdiction
(absent a conflict of interest, in which case the Issuing Bank and the Lenders
may engage and be reimbursed for additional counsel), in connection with the
enforcement, collection or protection of its rights in connection with the Loan
Documents, including its rights under this Section, or in connection with the
Loans made or Letters of Credit issued hereunder, and with respect to each
Issuing Bank and Lender, all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit. Expenses being reimbursed by the Borrowers under this Section include,
without limiting the generality of the foregoing, costs and expenses incurred in
connection with:

(i) appraisals and insurance reviews;

(ii) field examinations and the preparation of Reports based on the fees charged
by a third party retained by the Administrative Agent or the internally
allocated fees for each Person employed by the Administrative Agent with respect
to each field examination, together with the reasonable fees and expenses
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collateral monitoring services performed by the Administrative Agent (and the
Borrowers agree to modify or adjust the computation of the Borrowing Base —
which may include maintaining additional Reserves — to the extent required by
the Administrative Agent as a result of any such evaluation, appraisal or
monitoring);

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

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

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

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

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

(b) The Borrowers and the Loan Guarantors shall, jointly and severally,
indemnify the Administrative Agent, each Issuing Bank, each Lead Arranger and
each Lender, and each Related Party (other than Permitted Holders) of any of the
foregoing Persons (each such Person being called an “Indemnitee”) against, and
hold each Indemnitee harmless from, any and all losses, claims, damages,
penalties, liabilities and related expenses (including the reasonable fees,
charges and disbursements of one counsel for all Indemnitees and one firm of
local counsel and regulatory counsel in each appropriate jurisdiction, which may
include a single special counsel acting in multiple jurisdictions, for all
Indemnitees and, in the case of an actual or potential conflict of interest
where the Indemnitee affected by such conflict informs Borrowers and thereafter
retains its own counsel, of another firm of counsel for such affected
Indemnitee) incurred by or asserted against any Indemnitee (regardless of
whether such Indemnitee is a party hereto) arising out of, in connection with,
or as a result of (i) the execution or delivery of the Loan Documents or any
agreement or instrument contemplated thereby, the performance by the parties
hereto of their respective obligations thereunder or the consummation of the
Transactions or any other transactions contemplated hereby (but excluding any
losses, liabilities, claims, damages or expenses relating to the matters
referred to in Section 2.15 and 2.16, which shall be the sole remedy in respect
of the matters set forth therein), (ii) any Loan or Letter of Credit or the use
of the proceeds therefrom (including any refusal by an Issuing Bank to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such Letter
of Credit), (iii) any actual or alleged presence or release of Hazardous
Materials on or from any property owned or operated by any Borrower or any of
the Restricted Subsidiaries, or any Environmental Liability related in any way
to any Borrower or any of the Restricted Subsidiaries, (iv) the failure of the
Borrowers to deliver to the Administrative Agent the required receipts or other
required documentary evidence with respect to a payment made by the Borrowers
for Taxes pursuant to Section 2.17, 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 and regardless of whether
any Indemnitee is a party thereto and whether or not such proceeding is
instituted or brought on behalf of a third party or by any Loan Party or any of
its respective Affiliates; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
penalties, liabilities or related expenses are determined by a court of
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jurisdiction by final and nonappealable judgment to have resulted from (A) the
bad faith, gross negligence or willful misconduct of such Indemnitee or its
controlled Affiliates (other than the Permitted Holders), officers, directors,
employees, agents or controlling persons acting in connection with the
Transactions, (B) a material breach of an express obligation of such Indemnitee
or one of its controlled Affiliates (other than any Permitted Holder) and
(C) any dispute between and among Indemnitees that does not involve an act or
omission by the Borrowers or their Affiliates (other than any claims against any
of the Administrative Agent, Lead Arrangers, Joint Bookrunners or any similar
role hereunder in its capacity or in fulfilling its role as such). This
Section 9.03(b) shall not apply with respect to Taxes other than any Taxes that
represent losses, claims, damages, etc. arising from any non-Tax claim.

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

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

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

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

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

(A) the Borrower Representative (which consent shall be deemed given if no
objection is made within five Business Days after notice of the proposed
assignment), provided that no consent of the Borrower Representative shall be
required for an assignment to a Lender, an Affiliate of a Lender, an Approved
Fund or, if an Event of Default has occurred and is continuing, any other
assignee;

 

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(B) the Administrative Agent; provided that no consent of the Administrative
Agent shall be required for an assignment to a Lender, an Affiliate of a Lender
or an Approved Fund; and

(C) each Issuing Bank and Swingline Lender.

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

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

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;

(C) the parties to each assignment shall deliver to the Administrative Agent the
Assignment Notice duly executed by the assigning Lender, the assignee, the
Administrative Agent, each Issuing Bank, the Swingline Lender and, if
applicable, the Borrower Representative, together with a processing and
recordation fee of $3,500; and

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

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

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

 

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(i) Subject to acceptance and recording thereof pursuant to paragraph (b)(iii)
of this Section, from and after the effective date specified in each Assignment
Notice the assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by the applicable Assignment and Acceptance, 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
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 2.15,
2.16, 2.17 and 9.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 9.04
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section.

(ii) The Administrative Agent, acting for this purpose as an agent of the
Borrowers, shall maintain at one of its offices a copy of each Assignment Notice
delivered to it and a register for the recordation of the names and addresses of
the Lenders, and the Commitment of, and principal amounts (and stated interest)
of the Loans and LC Disbursements owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”). The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrowers, the
Administrative Agent, the Issuing Banks and the Lenders shall 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. Any assignment of any Loan,
whether or not evidenced by a note, shall be effective only upon appropriate
entries with respect thereto being made in the Register (and each note shall
expressly so provide). The Register shall be available for inspection by the
Borrowers, any Issuing Bank and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.

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

(c) Any Lender may, without the consent of the Borrowers, the Administrative
Agent, any Issuing Bank or the Swingline Lender, sell participations to one or
more banks or other entities (a “Participant”) in all or a portion of such
Lender’s rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans owing to it); provided that (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 Borrowers, the Administrative Agent, the Issuing
Banks and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under this
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pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 9.02(b) that affects such Participant.
The Borrowers agree that each Participant shall be entitled to the benefits of
Sections 2.15, 2.16 and 2.17 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section;
provided that such Participant (A) agrees to be subject to the provisions of
Section 2.19 as if it were an assignee under paragraph (b) of this Section 9.04;
and (B) shall not be entitled to receive any greater payment under Section 2.15
or 2.17, with respect to any participation, than its participating Lender would
have been entitled to receive, except to the extent such entitlement to receive
a greater payment results from a Change in Law that occurs after the Participant
acquired the applicable participation. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 9.08 as though it
were a Lender, provided such Participant agrees to be subject to Section 2.18(d)
as though it were a Lender. Each Lender that sells a participation shall, acting
solely for this purpose as a non-fiduciary agent of the Borrower, maintain a
register on which it enters the name and address of each Participant and the
principal amounts (and stated interest) of each Participant’s interest in the
Loans or other obligations under the Loan Documents (the “Participant
Register”); provided that no Lender shall have any obligation to disclose all or
any portion of the Participant Register (including the identity of any
Participant or any information relating to a Participant’s interest in any
commitments, loans, letters of credit or its other obligations under any Loan
Document) to any Person except to the extent that such disclosure is necessary
to establish that such commitment, loan, letter of credit or other obligation is
in registered form under Section 5f.103-1(c) of the United States Treasury
Regulations. The entries in the Participant Register shall be conclusive absent
manifest error, and such Lender shall treat each Person whose name is recorded
in the Participant Register as the owner of such participation for all purposes
of this Agreement notwithstanding any notice to the contrary. For the avoidance
of doubt, the Administrative Agent (in its capacity as Administrative Agent)
shall have no responsibility for maintaining a Participant Register.

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

(e) No assignment or participation may be made to any Permitted Holder, Borrower
or Affiliate of any Borrower except to the entities listed in Schedule 9.04(e).

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

 

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

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

SECTION 9.08 Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other obligations at any time owing by such
Lender or Affiliate to or for the credit or the account of the Borrowers or such
Loan Guarantor against any of and all the Secured Obligations held by such
Lender, irrespective of whether or not such Lender shall have made any demand
under the Loan Documents and although such obligations may be unmatured;
provided, that no amount received pursuant to this Section 9.08 from any Loan
Party shall be applied to the Excluded Swap Obligations of any Loan Party. The
applicable Lender shall notify the Borrower Representative and the
Administrative Agent of such set-off or application, provided that any failure
to give or any delay in giving such notice shall not affect the validity of any
such set-off or application under this Section. The rights of each Lender under
this Section are in addition to other rights and remedies (including other
rights of setoff) which such Lender may have.

SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process. (a) The
Loan Documents (other than those containing a contrary express choice of law
provision) shall be governed by and construed in accordance with the laws of the
State of New York, but giving effect to federal laws applicable to national
banks.

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

 

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

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

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

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

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

 

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EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.12 FURNISHED
TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION
CONCERNING THE COMPANY AND ITS AFFILIATES AND THEIR RELATED PARTIES OR THEIR
RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES
REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE
SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND
APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE
BORROWERS OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF
ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY
CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE COMPANY, THE LOAN PARTIES AND
THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. ACCORDINGLY, EACH LENDER
REPRESENTS TO THE BORROWERS AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED
IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION
THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS
COMPLIANCE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES
LAWS.

SECTION 9.13 Several Obligations; Nonreliance; Violation of Law. The respective
obligations of the Lenders hereunder are several and not joint and the failure
of any Lender to make any Loan or perform any of its obligations hereunder shall
not relieve any other Lender from any of its obligations hereunder. Each Lender
hereby represents that it is not relying on or looking to any margin stock for
the repayment of the Borrowings provided for herein. Anything contained in this
Agreement to the contrary notwithstanding, no Issuing Bank nor any Lender shall
be obligated to extend credit to the Borrowers in violation of any Requirement
of Law.

SECTION 9.14 USA PATRIOT Act. Each Lender that is subject to the requirements of
the Patriot Act hereby notifies the Loan Parties that pursuant to the
requirements of the Act, it is required to obtain, verify and record information
that identifies each Loan Party, which information includes the names and
addresses of each Loan Party and other information that will allow such Lender
to identify each Loan Party in accordance with the Act.

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

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

 

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

SECTION 9.18 No Advisory or Fiduciary Duty. In connection with all aspects of
each transaction contemplated hereby (including in connection with any
amendment, waiver or other modification hereof or of any other Loan Document),
each Loan Party acknowledges and agrees, and acknowledges its Affiliates’
understanding, that: (a) (i) the arranging and other services regarding this
Agreement provided by the Administrative Agent and the Lead Arrangers are
arm’s-length commercial transactions between the Loan Parties and their
respective Affiliates, on the one hand, and the Administrative Agent and the
Lead Arrangers, on the other hand, (ii) each of the Loan Parties has consulted
its own legal, accounting, regulatory and tax advisors to the extent it has
deemed appropriate, and (iii) each of the Loan Parties is capable of evaluating,
and understands and accepts, the terms, risks and conditions of the transactions
contemplated hereby and by the other Loan Documents; (b) (i) the Administrative
Agent and the Lead Arrangers each is and has been acting solely as a principal
and, except as expressly agreed in writing by the relevant parties, has not
been, is not, and will not be acting as an advisor, agent or fiduciary for the
Loan Parties or any of their respective Affiliates, or any other Person and
(ii) neither the Administrative Agent nor either Lead Arranger has any
obligation to the Loan Parties or any of their respective Affiliates with
respect to the transactions contemplated hereby except those obligations
expressly set forth herein and in the other Loan Documents; and (c) the
Administrative Agent and the Lead Arrangers and their respective Affiliates may
be engaged in a broad range of transactions that involve interests that differ
from those of the Loan Parties and their respective Affiliates, and neither the
Administrative Agent nor either Lead Arranger has any obligation to disclose any
of such interests to the Borrowers or any of their respective Affiliates. To the
fullest extent permitted by law, each Loan Party hereby waives and releases any
claims that it may have against the Administrative Agent and the Lead Arrangers
with respect to any breach or alleged breach of agency or fiduciary duty to such
Loan Party or its Affiliates in connection with any aspect of any transaction
contemplated hereby.

ARTICLE X

LOAN GUARANTY

SECTION 10.01 Guaranty. Each Loan Guarantor (other than those that have
delivered a separate Guaranty) hereby agrees that it is jointly and severally
liable for, and absolutely and unconditionally guarantees to the Administrative
Agent, each Issuing Bank and the Lenders, the prompt payment when due, whether
at stated maturity, upon acceleration or otherwise, and at all times thereafter,
of the Secured Obligations and all costs and expenses including, without
limitation, all court costs and attorneys’ and paralegals’ fees (including
allocated costs of in-house counsel and paralegals) and expenses paid or
incurred by the Administrative Agent, the Issuing Banks and the Lenders in
endeavoring to collect all or any part of the Secured Obligations from, or in
prosecuting any action against, any Borrower, any Loan Guarantor or any other
guarantor of all or any part of the Secured Obligations (such costs and
expenses, together with the Secured Obligations, collectively the “Guaranteed
Obligations”). Each Loan Guarantor further agrees that the Guaranteed
Obligations may be extended or renewed in whole or in part

 

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without notice to or further assent from it, and that it remains bound upon its
guarantee notwithstanding any such extension or renewal. All terms of this Loan
Guaranty apply to and may be enforced by or on behalf of any domestic or foreign
branch or Affiliate of any Lender that extended any portion of the Guaranteed
Obligations.

SECTION 10.02 Guaranty of Payment. This Loan Guaranty is a guaranty of payment
and not of collection. Each Loan Guarantor waives any right to require the
Administrative Agent, any Issuing Bank or any Lender to sue any Borrower, any
Loan Guarantor, any other guarantor, or any other person obligated for all or
any part of the Guaranteed Obligations (each, an “Obligated Party”), or
otherwise to enforce its payment against any collateral securing all or any part
of the Guaranteed Obligations.

SECTION 10.03 No Discharge or Diminishment of Loan Guaranty. (a) Except as
otherwise provided for herein, the obligations of each Loan Guarantor hereunder
are unconditional and absolute and not subject to any reduction, limitation,
impairment or termination for any reason (other than the indefeasible payment in
full in cash of the Guaranteed Obligations), including: (i) any claim of waiver,
release, extension, renewal, settlement, surrender, alteration, or compromise of
any of the Guaranteed Obligations, by operation of law or otherwise; (ii) any
change in the corporate existence, structure or ownership of any Borrower or any
other guarantor of or other person liable for any of the Guaranteed Obligations;
(iii) any insolvency, bankruptcy, reorganization or other similar proceeding
affecting any Obligated Party, or their assets or any resulting release or
discharge of any obligation of any Obligated Party; or (iv) the existence of any
claim, setoff or other rights which any Loan Guarantor may have at any time
against any Obligated Party, the Administrative Agent, any Issuing Bank, any
Lender, or any other person, whether in connection herewith or in any unrelated
transactions.

(b) The obligations of each Loan Guarantor hereunder are not subject to any
defense or setoff, counterclaim, recoupment, or termination whatsoever by reason
of the invalidity, illegality, or unenforceability of any of the Guaranteed
Obligations or otherwise, or any provision of applicable law or regulation
purporting to prohibit payment by any Obligated Party, of the Guaranteed
Obligations or any part thereof.

(c) Further, the obligations of any Loan Guarantor hereunder are not discharged
or impaired or otherwise affected by: (i) the failure of the Administrative
Agent, any Issuing Bank or any Lender to assert any claim or demand or to
enforce any remedy with respect to all or any part of the Guaranteed
Obligations; (ii) any waiver or modification of or supplement to any provision
of any agreement relating to the Guaranteed Obligations; (iii) any release,
non-perfection, or invalidity of any indirect or direct security for the
obligations of any Borrower for all or any part of the Guaranteed Obligations or
any obligations of any other guarantor of or other person liable for any of the
Guaranteed Obligations; (iv) any action or failure to act by the Administrative
Agent, any Issuing Bank or any Lender with respect to any collateral securing
any part of the Guaranteed Obligations; or (v) any default, failure or delay,
willful or otherwise, in the payment or performance of any of the Guaranteed
Obligations, or any other circumstance, act, omission or delay that might in any
manner or to any extent vary the risk of such Loan Guarantor or that would
otherwise operate as a discharge of any Loan Guarantor as a matter of law or
equity (other than the indefeasible payment in full in cash of the Guaranteed
Obligations).

SECTION 10.04 Defenses Waived. To the fullest extent permitted by applicable
law, each Loan Guarantor hereby waives any defense based on or arising out of
any defense of any Borrower or any Loan Guarantor or the unenforceability of all
or any part of the Guaranteed Obligations from any cause, or the cessation from
any cause of the liability of any Borrower or any Loan Guarantor, other than the
indefeasible payment in full in cash of the Guaranteed Obligations. Without
limiting the generality of the foregoing, each Loan Guarantor irrevocably waives
acceptance hereof, presentment, demand, protest and, to the fullest extent
permitted by law, any notice not provided for herein, as well as any requirement
that at

 

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any time any action be taken by any person against any Obligated Party, or any
other person. Each Loan Guarantor confirms that it is not a surety under any
state law and shall not raise any such law as a defense to its obligations
hereunder. The Administrative Agent may, at its election, foreclose on any
Collateral held by it by one or more judicial or nonjudicial sales, accept an
assignment of any such Collateral in lieu of foreclosure or otherwise act or
fail to act with respect to any collateral securing all or a part of the
Guaranteed Obligations, compromise or adjust any part of the Guaranteed
Obligations, make any other accommodation with any Obligated Party or exercise
any other right or remedy available to it against any Obligated Party, without
affecting or impairing in any way the liability of such Loan Guarantor under
this Loan Guaranty except to the extent the Guaranteed Obligations have been
fully and indefeasibly paid in cash. To the fullest extent permitted by
applicable law, each Loan Guarantor waives any defense arising out of any such
election even though that election may operate, pursuant to applicable law, to
impair or extinguish any right of reimbursement or subrogation or other right or
remedy of any Loan Guarantor against any Obligated Party or any security.

SECTION 10.05 Rights of Subrogation. No Loan Guarantor will assert any right,
claim or cause of action, including, without limitation, a claim of subrogation,
contribution or indemnification that it has against any Obligated Party, or any
collateral, until the Loan Parties and the Loan Guarantors have fully performed
all their obligations to the Administrative Agent, the Issuing Banks and the
Lenders.

SECTION 10.06 Reinstatement; Stay of Acceleration. If at any time any payment of
any portion of the Guaranteed Obligations is rescinded or must otherwise be
restored or returned upon the insolvency, bankruptcy, or reorganization of any
Borrower or otherwise, each Loan Guarantor’s obligations under this Loan
Guaranty with respect to that payment shall be reinstated at such time as though
the payment had not been made and whether or not the Administrative Agent, the
Issuing Banks and the Lenders are in possession of this Loan Guaranty. If
acceleration of the time for payment of any of the Guaranteed Obligations is
stayed upon the insolvency, bankruptcy or reorganization of any Borrower, all
such amounts otherwise subject to acceleration under the terms of any agreement
relating to the Guaranteed Obligations shall nonetheless be payable by the Loan
Guarantors forthwith on demand by the Lender.

SECTION 10.07 Information. Each Loan Guarantor assumes all responsibility for
being and keeping itself informed of the Borrowers’ financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Guaranteed Obligations and the nature, scope and extent of the risks that
each Loan Guarantor assumes and incurs under this Loan Guaranty, and agrees that
neither the Administrative Agent, any Issuing Bank nor any Lender shall have any
duty to advise any Loan Guarantor of information known to it regarding those
circumstances or risks.

SECTION 10.08 Taxes. All payments of the Guaranteed Obligations will be made by
each Loan Guarantor free and clear of and without deduction for any Indemnified
Taxes or Other Taxes; provided that if any Loan Guarantor shall be required to
deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) the Administrative Agent, Lender or applicable Issuing Bank (as
the case may be) receives an amount equal to the sum it would have received had
no such deductions been made, (ii) such Loan Guarantor shall make such
deductions and (iii) such Loan Guarantor shall pay the full amount deducted to
the relevant Governmental Authority in accordance with applicable law.

SECTION 10.09 Maximum Liability. The provisions of this Loan Guaranty are
severable, and in any action or proceeding involving any state corporate law, or
any state, federal or foreign bankruptcy, insolvency, reorganization or other
law affecting the rights of creditors generally, if the obligations of any Loan
Guarantor under this Loan Guaranty would otherwise be held or determined to be
avoidable, invalid or unenforceable on account of the amount of such Loan
Guarantor’s liability under this Loan Guaranty,

 

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then, notwithstanding any other provision of this Loan Guaranty to the contrary,
the amount of such liability shall, without any further action by the Loan
Guarantors or the Lenders, be automatically limited and reduced to the highest
amount that is valid and enforceable as determined in such action or proceeding
(such highest amount determined hereunder being the relevant Loan Guarantor’s
“Maximum Liability”). This Section with respect to the Maximum Liability of each
Loan Guarantor is intended solely to preserve the rights of the Lenders to the
maximum extent not subject to avoidance under applicable law, and no Loan
Guarantor nor any other person or entity shall have any right or claim under
this Section with respect to such Maximum Liability, except to the extent
necessary so that the obligations of any Loan Guarantor hereunder shall not be
rendered voidable under applicable law. Each Loan Guarantor agrees that the
Guaranteed Obligations may at any time and from time to time exceed the Maximum
Liability of each Loan Guarantor without impairing this Loan Guaranty or
affecting the rights and remedies of the Lenders hereunder, provided that,
nothing in this sentence shall be construed to increase any Loan Guarantor’s
obligations hereunder beyond its Maximum Liability. Notwithstanding anything to
the contrary herein, all Borrowers shall be liable for all Loans made to them
without reduction.

SECTION 10.10 Contribution. In the event any Loan Guarantor (a “Paying
Guarantor”) shall make any payment or payments under this Loan Guaranty or shall
suffer any loss as a result of any realization upon any collateral granted by it
to secure its obligations under this Loan Guaranty, each other Loan Guarantor
(each a “Non-Paying Guarantor”) shall contribute to such Paying Guarantor an
amount equal to such Non-Paying Guarantor’s “Guarantor Percentage” of such
payment or payments made, or losses suffered, by such Paying Guarantor. For
purposes of this Article X, each Non-Paying Guarantor’s “Guarantor Percentage”
with respect to any such payment or loss by a Paying Guarantor shall be
determined as of the date on which such payment or loss was made by reference to
the ratio of (i) such Non-Paying Guarantor’s Maximum Liability as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder) or, if such Non-Paying Guarantor’s Maximum Liability has
not been determined, the aggregate amount of all monies received by such
Non-Paying Guarantor from the Borrowers after the date hereof (whether by loan,
capital infusion or by other means) to (ii) the aggregate Maximum Liability of
all Loan Guarantors hereunder (including such Paying Guarantor) as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder), or to the extent that a Maximum Liability has not been
determined for any Loan Guarantor, the aggregate amount of all monies received
by such Loan Guarantors from the Borrowers after the date hereof (whether by
loan, capital infusion or by other means). Nothing in this provision shall
affect any Loan Guarantor’s several liability for the entire amount of the
Guaranteed Obligations (up to such Loan Guarantor’s Maximum Liability). Each of
the Loan Guarantors covenants and agrees that its right to receive any
contribution under this Loan Guaranty from a Non-Paying Guarantor shall be
subordinate and junior in right of payment to the payment in full in cash of the
Guaranteed Obligations. This provision is for the benefit of both the
Administrative Agent, the Issuing Banks, the Lenders and the Loan Guarantors and
may be enforced by any one, or more, or all of them in accordance with the terms
hereof.

SECTION 10.11 Liability Cumulative. The liability of each Loan Party as a Loan
Guarantor under this Article X is in addition to and shall be cumulative with
all liabilities of each Loan Party to the Administrative Agent, the Issuing
Banks and the Lenders under this Agreement and the other Loan Documents to which
such Loan Party is a party or in respect of any obligations or liabilities of
the other Loan Parties, without any limitation as to amount, unless the
instrument or agreement evidencing or creating such other liability specifically
provides to the contrary.

SECTION 10.12 Commodity Exchange Act Keepwell. Each Loan Party that is a
Qualified ECP when its guaranty of or grant of Lien as security for a Hedge
Obligation becomes effective hereby jointly and severally, absolutely,
unconditionally and irrevocably undertakes to provide funds or other support to
each Specified Loan Party with respect to such Hedge Obligation as may be needed
by such Specified Loan Party from time to time to honor all of its obligations
under the Loan Documents in respect

 

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of such Hedge Obligation (but, in each case, only up to the maximum amount of
such liability that can be hereby incurred without rendering such Qualified
ECP’s obligations and undertakings under this Section 10.12 voidable under any
applicable fraudulent transfer or conveyance act). The obligations and
undertakings of each Qualified ECP under this Section shall remain in full force
and effect until all Secured Obligations are paid in full and all of the
Lenders’ Commitments are terminated. Each Loan Party intends this Section to
constitute, and this Section shall be deemed to constitute, a guarantee of the
obligations of, and a “keepwell, support or other agreement” for the benefit of,
each Loan Party for all purposes of the Commodity Exchange Act.

ARTICLE XI

THE BORROWER REPRESENTATIVE

SECTION 11.01 Appointment; Nature of Relationship. The Company is hereby
appointed by each of the Borrowers as its contractual representative (herein
referred to as the “Borrower Representative”) hereunder and under each other
Loan Document, and each of the Borrowers irrevocably authorizes the Borrower
Representative to act as the contractual representative of such Borrower with
the rights and duties expressly set forth herein and in the other Loan
Documents. The Borrower Representative agrees to act as such contractual
representative upon the express conditions contained in this Article XI.
Additionally, the Borrowers hereby appoint the Borrower Representative as their
agent to receive all of the proceeds of the Loans in the Funding Account(s), at
which time the Borrower Representative shall promptly disburse such Loans to the
appropriate Borrower. The Administrative Agent and the Lenders, and their
respective officers, directors, agents or employees, shall not be liable to the
Borrower Representative or any Borrower for any action taken or omitted to be
taken by the Borrower Representative or the Borrowers pursuant to this
Section 11.01.

SECTION 11.02 Powers The Borrower Representative shall have and may exercise
such powers under the Loan Documents as are specifically delegated to the
Borrower Representative by the terms of each thereof, together with such powers
as are reasonably incidental thereto. The Borrower Representative shall have no
implied duties to the Borrowers, or any obligation to the Lenders to take any
action thereunder except any action specifically provided by the Loan Documents
to be taken by the Borrower Representative.

SECTION 11.03 Employment of Agents. The Borrower Representative may execute any
of its duties as the Borrower Representative hereunder and under any other Loan
Document by or through authorized officers.

SECTION 11.04 Notices. Each Borrower shall immediately notify the Borrower
Representative of the occurrence of any Default hereunder referring to this
Agreement describing such Default and stating that such notice is a “notice of
default.” In the event that the Borrower Representative receives such a notice,
the Borrower Representative shall give prompt notice thereof to the
Administrative Agent and the Lenders. Any notice provided to the Borrower
Representative hereunder shall constitute notice to each Borrower on the date
received by the Borrower Representative.

SECTION 11.05 Successor Borrower Representative. Upon the prior written consent
of the Administrative Agent, the Borrower Representative may resign at any time,
such resignation to be effective upon the appointment of a successor Borrower
Representative. The Administrative Agent shall give prompt written notice of
such resignation to the Lenders.

SECTION 11.06 Execution of Loan Documents; Borrowing Base Certificate. The
Borrowers hereby empower and authorize the Borrower Representative, on behalf of
the Borrowers, to execute and

 

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deliver to the Administrative Agent and the Lenders the Loan Documents and all
related agreements, certificates, documents, or instruments as shall be
necessary or appropriate to effect the purposes of the Loan Documents, including
without limitation, the Borrowing Base Certificates and the Compliance
Certificates. Each Borrower agrees that any action taken by the Borrower
Representative or the Borrowers in accordance with the terms of this Agreement
or the other Loan Documents, and the exercise by the Borrower Representative of
its powers set forth therein or herein, together with such other powers that are
reasonably incidental thereto, shall be binding upon all of the Borrowers.

SECTION 11.07 Reporting. Each Borrower hereby agrees that such Borrower shall
furnish promptly after each fiscal month to the Borrower Representative a copy
of its Borrowing Base Certificate and any other certificate or report required
hereunder or requested by the Borrower Representative on which the Borrower
Representative shall rely to prepare the Borrowing Base Certificates and
Compliance Certificates required pursuant to the provisions of this Agreement.

[Remainder of page intentionally left blank; signatures begin on following page]

 

117

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

 

BORROWERS: INTERLINE BRANDS, INC., a New Jersey corporation By:  

 

  Name:   Title: WILMAR HOLDINGS, INC., a Delaware corporation By:  

                                                             
                              

  Name:   Title:   WILMAR FINANCIAL, INC., a Delaware corporation By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

OTHER LOAN PARTIES/LOAN GUARANTORS: INTERLINE BRANDS, INC., a Delaware
corporation By:  

 

  Name:   Title: GLENWOOD ACQUISITION LLC, a Delaware limited liability company
By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

AGENTS AND LENDERS: BANK OF AMERICA, N.A., individually, as Administrative
Agent, Issuing Bank, Swingline Lender and a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

GOLDMAN SACHS LENDING PARTNERS LLC, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

U.S. BANK NATIONAL ASSOCIATION, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

KEYBANK NATIONAL ASSOCIATION, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

TD BANK, N.A., as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

REGIONS BANK, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

BARCLAYS BANK PLC, as a Lender By:  

 

  Name:   Title:

 

Signature Page to Credit Agreement

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

COMMITMENT SCHEDULE

 

Lender    Commitment  

Bank of America, N.A.

   $ 60,000,000   

Wells Fargo Bank, National Association

   $ 40,000,000   

KeyBank National Association

   $ 40,000,000   

U.S. Bank National Association

   $ 37,500,000   

TD Bank, N.A.

   $ 37,500,000   

Regions Bank

   $ 22,500,000   

Goldman Sachs Lending Partners LLC

   $ 20,000,000   

Barclays Bank PLC

   $ 17,500,000   

Total

   $ 275,000,000.00   

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

Annex C

 

Annex C to First Amendment to Credit Agreement

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

EXHIBIT C

FORM OF COMPLIANCE CERTIFICATE

 

To: Bank of America, N.A., as Administrative Agent

This Compliance Certificate is furnished pursuant to that certain Credit
Agreement dated as of September 7, 2012 (as amended, supplemented or modified
from time to time, the “Agreement”) among Interline Brands, Inc., a New Jersey
corporation (the “Company”), Wilmar Holdings, Inc., a Delaware corporation
(“Wilmar Holdings”), and Wilmar Financial, Inc., a Delaware corporation (“Wilmar
Financial”, and together with the Company, Wilmar Holdings and each other
subsidiary of the Company that subsequently joins the Credit Agreement as a
“Borrower”, the “Borrowers”), the other Loan Parties, the Lenders and Bank of
America, N.A., as Administrative Agent for the Lenders. Unless otherwise defined
herein, capitalized terms used in this Compliance Certificate have the meanings
ascribed to them in the Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1. I am the duly elected [Chief Financial Officer/Principal Accounting
Officer/Treasurer/Controller] of Holdings;

2. I have reviewed the terms of the Agreement and I have made, or have caused to
be made under my supervision, a detailed review of the transactions and
conditions of Holdings and its Restricted Subsidiaries during the accounting
period covered by the attached financial statements [for quarterly financial
statements add: and such financial statements present fairly in all material
respects the financial condition and results of operations of Holdings and its
consolidated Restricted Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes];

3. The examinations described in paragraph 2 did not disclose and, except as set
forth below, I have no knowledge of (i) the existence of any condition or event
which constitutes a Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate or (ii) any change in GAAP or in the application thereof that has
occurred since the date of the audited financial statements referred to in
Section 3.04 of the Agreement;

4. I hereby certify that no Loan Party has changed (i) its name as it appears in
its organizational documents and as filed in such Loan Party’s jurisdiction of
organization, (ii) its chief executive office, principal place of business,
mailing address, corporate offices, warehouses or locations at which Collateral
is held or stored (or added to such locations), or the location of its records
concerning the Collateral, in each case from the locations identified on Exhibit
A to the Security Agreement, (iii) the type of entity it is, (iv) its
organizational identification number, if any, issued by its state of
organization or (vi) its state of incorporation or organization, in each case
without having given the Administrative Agent the notice required by
Section 4.14 of the Security Agreement;

5. Schedule I attached hereto sets forth a reasonably detailed calculation of
the Fixed Charge Coverage Ratio [and the Borrowers’ compliance with Section 6.12
of the Agreement] [add bracketed language during a Covenant Trigger Period];

6. Schedule II attached hereto sets forth the amount of any Pro Forma Adjustment
not previously set forth in a Pro Forma Adjustment Certificate and/or any change
in the amount of a Pro Forma Adjustment set forth in the Pro Forma Adjustment
Certificate previously provided on              20      and, [in each case,] in
reasonable detail, the calculations and basis therefor; and

7. Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, (i) the nature of the condition or event, the period during which it has
existed and the action which the

 

Exhibit C-1

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

Borrowers have taken, are taking, or propose to take with respect to each such
condition or event or (ii) the change in GAAP or the application thereof and the
effect of such change on the attached financial statements:

 

 

 

 

 

 

The foregoing certifications, together with the computations set forth in
Schedule I hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered this      day of             , 20    .

 

INTERLINE BRANDS, INC., a Delaware corporation By:  

 

  Name:   Title:

 

Exhibit C-2

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

SCHEDULE I

Calculation of the Fixed Charge Coverage Ratio for the quarter/year ended
                     (“Statement Date”) [and Compliance as of             , 20
     with Section 6.12 of the Agreement]

 

I.   Fixed Charge Coverage Ratio1                      TOTAL     A.  

EBITDA

       (i)    Net Income                  +             

 

 

      (ii)    Interest Expense      +             

 

 

      (iii)    income taxes      +             

 

 

      (iv)    depreciation and amortization expense      +             

 

 

      (v)    extraordinary charges      +             

 

 

      (vi)    impairment charges or asset write-offs related to intangible,
long-lived assets and investments in debt and equity securities pursuant to GAAP
     +             

 

 

      (vii)    losses from (a) non-ordinary course asset sales and
(b) investments recorded using the equity method      +             

 

 

      (viii)    stock-based awards compensation expense      +             

 

 

      (ix)    other non-cash charges2      +             

 

 

      (x)    management, monitoring and consulting fees and expenses paid to
Sponsors3      +             

 

 

      (xi)    transaction fees and related expenses paid to the Sponsors in
connection with acquisitions, dispositions, recapitalizations, refinancings and
extraordinary transactions4      +             

 

 

      (xii)    Transaction costs and expenses paid by Borrowers      +          
  

 

 

      (xiii)    up-front fees, transaction costs, commissions, expenses or
charges related to any Permitted Acquisition or other Specified Investment
(whether or not consummated but excluding any of the foregoing paid or payable
to the Sponsors under clause (x) or (xi) above)      +             

 

 

 

 

1  Calculations shall be for the four consecutive fiscal quarters ending on the
Statement Date for Holdings and its Restricted Subsidiaries on a consolidated
basis.

2  Excluding any non-cash charge in respect of an item that was included in Net
Income (other than accrual of revenue in the ordinary course of business) in a
prior period.

3  Not to exceed $5,000,000 in any four quarter period.

4  Not to exceed (net of reimbursable expenses) 1% of the transaction value for
any such transaction.

 

Exhibit C-3

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

SCHEDULE I

 

    (xiv)    restructuring and other non-recurring expenses, including severance
costs, costs associated with office or plant openings or closings and
consolidation or relocation fees                  +             

 

 

      (xv)    up-front fees, transaction costs, commissions, expenses, premiums
or charges related to the issuance of Equity Interests, permitted investments
(other than Specified Investments), permitted asset sales, recapitalizations,
incurrences, repayments, amendments or modifications or permitted Indebtedness
(excluding any of the foregoing paid or payable to the Sponsors under clause
(x) or (xi) above)                  +             

 

 

      (xvi)
   cash payments made in respect of non-cash charges described in clause
(ix) above      –             

 

 

      (xvii)    extraordinary gains      –             

 

 

      (xviii)    non-cash items of income5      –             

 

 

      (xix)    gains from non-ordinary course asset sales and investments
recorded using the equity method      –             

 

 

  1.     Intermediate EBITDA ((sum of (i) through (xiii)) – (sum of
(xvi) through (xix))             

 

 

  2.     Adjustments to EBITDA (excluding Pro Forma Adjustments)6             

 

 

  3.     Pro Forma Adjustments             

 

 

  4.     Limited EBITDA Add-Backs (sum of (xiv) and (xv) and Pro Forma
Adjustment)             

 

 

      Total EBITDA ((1. +/– 2.) + the lesser of (4.) and (0.10 x (1 +/– 2.)))   
         

 

 

  B.   Unfinanced portion of Capital Expenditures   

 

5  Excluding any non-cash gain to the extent it represents the reversal of an
accrual or reserve for a potential cash item that reduced Net Income in any
prior period.

6  To the extent included in Net Income, (a) there shall be excluded in
determining EBITDA (i) unrealized currency translation gains and losses related
to currency remeasurements of Indebtedness or intercompany balances (including
the net loss or gain resulting from Swap Agreements for currency exchange risk)
and (ii) any adjustments for unrealized gain or loss resulting from the
application of Statement of Financial Accounting Standards No. 133, and
(b) there shall be included in determining EBITDA, without duplication, (i) the
Acquired EBITDA of any Acquired Entity or Business since the beginning of such
period and the Acquired EBITDA of any Converted Restricted Subsidiary, based on
the actual Acquired EBITDA of such Acquired Entity or Business or Converted
Restricted Subsidiary for such period (including the portion thereof occurring
prior to such acquisition or conversion), (ii) an adjustment in respect of each
Acquired Entity or Business equal to the amount of the Pro Forma Adjustment with
respect to such Acquired Entity or Business acquired since the beginning of such
period (including the portion thereof occurring prior to such acquisition) as
specified in a Pro Forma Adjustment Certificate and delivered to the Lenders and
the Administrative Agent and (iii) there shall be excluded in determining EBITDA
for any period the Disposed EBITDA of any Sold Entity or Business, and the
Disposed EBITDA of any Converted Unrestricted Subsidiary based on the actual
Disposed EBITDA of such Sold Entity or Business or Converted Unrestricted
Subsidiary for such period (including the portion thereof occurring prior to
such sale, transfer or disposition or conversion).

 

Exhibit C-4

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SCHEDULE I

 

    (i)    Fixed or capital asset expenditures or commitments             

 

 

      (ii)    expenditures to replace or restore property made with insurance,
damage recovery proceeds or condemnation awards      –             

 

 

      (iii)    expenditures made with proceeds of the sale or trade of similar
assets to the assets being acquired      –             

 

 

      (iv)    expenditures that are part of a Permitted Acquisition (to the
extent included in (i))      –             

 

 

      (v)    expenditures funded with net proceeds of an issuance of Equity
Interests by Holdings7      –             

 

 

      Total Unfinanced Capital Expenditures ((i) – (sum of (ii) through (v)))   
  –             

 

 

  C.   Fixed Charges (for purposes of Section 6.12 of the Credit Agreement)     
  (i)    cash Interest Expense      +             

 

 

      (ii)    scheduled principal payments on Indebtedness      +             

 

 

      (iii)    expense for income taxes paid in cash      +             

 

 

      (iv)    dividends or distributions and repurchases, redemptions or
retirement of the Equity Interests of Holdings, in each case paid in cash      +
            

 

 

      (v)    dividends or distributions declared or made by Holdings pursuant to
Section 6.08(a)(vi) of the Credit Agreement      –             

 

 

      Total Fixed Charges ((sum of (i) through (iv)) minus (v))             

 

 

 

Fixed Charge Coverage Ratio (A – B) ÷ C

     :1.00             

 

 

 

 

7  Provided that the Company has notified the Administrative Agent at or prior
to the time of such issuance that it intends to utilize all or a portion of such
proceeds to fund such expenditure (and describing the contemplated use and
estimated amount of such expenditure) and such expenditure (or commitment
entered into) is made within 90 days of the issuance of such Equity Interests.

 

Exhibit C-5

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SCHEDULE I

 

Pro Forma Adjustments

[Attached]

 

Exhibit C-6

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

Annex D

 

Annex D to First Amendment to Credit Agreement

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

INTERCREDITOR AGREEMENT

dated as of March 17, 2014

among

INTERLINE BRANDS, INC.,

a New Jersey corporation,

as Company,

INTERLINE BRANDS, INC.,

a Delaware corporation,

as Holdings

and

the other GRANTORS from time to time party hereto,

BANK OF AMERICA, N.A.,

as Revolving Facility Agent,

and

BARCLAYS BANK PLC,

as First Lien Administrative Agent and as First Lien Security Agent

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Table of Contents

 

          Page   SECTION 1.    DEFINITIONS.      2   

1.1.

   Defined Terms.      2   

1.2.

   Terms Generally; Timing of Performance; Miscellaneous.      25   
SECTION 2.    LIEN PRIORITIES.      26    SECTION 3.     NOTES PRIORITY
COLLATERAL.      31   

3.1.

   Exercise of Remedies – Prior to Discharge of First Lien Obligations.      31
  

3.2.

   Exercise of Remedies – After Discharge of First Lien Obligations.      35   

3.3.

   Payments Over.      38   

3.4.

   Other Agreements.      39   

3.5.

   Insolvency or Liquidation Proceedings.      56   

3.6.

   Reliance; Waivers; Etc.      60    SECTION 4.     REVOLVING FACILITY PRIORITY
COLLATERAL.      66   

4.1.

   Exercise of Remedies – Prior to Discharge of Revolving Facility Obligations.
     66   

4.2.

   Exercise of Remedies – After Discharge of Revolving Facility Obligations.   
  70   

4.3.

   Payments Over.      73   

4.4.

   Other Agreements.      74   

4.5.

   Insolvency or Liquidation Proceedings.      88   

4.6.

   Reliance; Waivers; Etc.      94    SECTION 5.     GENERAL.      97   

5.1.

   Legends.      97   

5.2.

   Reorganization Securities.      97   

5.3.

   Post-Petition Interest.      97   

5.4.

   Obligations Unconditional.      98    SECTION 6.     COOPERATION WITH RESPECT
TO REVOLVING FACILITY PRIORITY COLLATERAL.      99   

6.1.

   Consent to License to Use Intellectual Property.      99   

6.2.

   Access to Information.      99   

6.3.

   Access to Property.      100   

6.4.

   Grantor Consent.      102   

6.5.

   Exercise of Cash Dominion; Funds Deposited in Controlled Securities Accounts
and Deposit Accounts.      103   

 

i

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SECTION 7.     APPLICATION OF PROCEEDS.      103   

7.1.

   Application of Proceeds in Distributions by the First Lien Security Agent.   
  103   

7.2.

   Application of Proceeds in Distributions by the Revolving Facility Agent.   
  105   

7.3.

   Application of Proceeds in Distributions by the Second Lien Security Agent.
     107   

7.4.

   Mixed Collateral Proceeds.      108    SECTION 8.     MISCELLANEOUS.      109
  

8.1.

   Conflicts.      109   

8.2.

   Effectiveness; Continuing Nature of this Agreement; Severability.      109   

8.3.

   Amendments; Waivers.      110   

8.4.

   Information Concerning Financial Condition of Holdings, the Company and its
Subsidiaries.      111   

8.5.

   Submission to Jurisdiction; Waivers.      112   

8.6.

   Notices.      113   

8.7.

   Further Assurances.      113   

8.8.

   APPLICABLE LAW.      113   

8.9.

   Binding on Successors and Assigns.      114   

8.10.

   Specific Performance.      114   

8.11.

   Headings.      114   

8.12.

   Counterparts.      114   

8.13.

   Authorization; No Conflict.      114   

8.14.

   No Third Party Beneficiaries.      114   

8.15.

   Provisions Solely to Define Relative Rights.      114   

8.16.

   Additional Grantors.      115   

8.17.

   Avoidance Issues.      116   

8.18.

   Subrogation.      116   

8.19.

   Additional Lien Obligations.      118   

8.20.

   Agreement Among Secured Parties to Coordinate Enforcement.      118   

Exhibit A Form of Intercreditor Agreement Joinder

 

ii

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This INTERCREDITOR AGREEMENT is dated as of March 17, 2014 and is by and among
Interline Brands, Inc., a New Jersey corporation (the “Company”), Interline
Brands, Inc., a Delaware corporation (“Holdings”), the other Grantors (as
defined in Section 1.1) from time to time party hereto, Bank of America, N.A.
(“Bank of America”), as Revolving Facility Agent (as defined below) and Barclays
Bank PLC (“Barclays”), as First Lien Administrative Agent and as First Lien
Security Agent (each, as defined below). Capitalized terms used herein but not
otherwise defined herein shall have the meanings set forth in Section 1 below.

RECITALS:

WHEREAS, Holdings, the Company and each other Grantor have entered into that
certain Credit Agreement, dated as of September 7, 2012, as amended as of the
date hereof (as further amended, restated, supplemented or otherwise modified
from time to time, the “Revolving Facility Credit Agreement”), among Holdings,
the Company, each other Grantor, the lenders from time to time party thereto,
Bank of America, as administrative agent (in such capacity, the “Revolving
Facility Agent”), and the other parties referred to therein;

WHEREAS, pursuant to the various Revolving Facility Documents, (i) the Grantors
are either borrowers of, or have provided guarantees for, the Revolving Facility
Obligations and (ii) certain of the Grantors have provided security for the
Revolving Facility Obligations;

WHEREAS, Holdings, the Company and each other Grantor have entered into that
certain First Lien Term Loan Agreement, dated as of the date hereof (as amended,
restated, supplemented or otherwise modified from time to time, the “First Lien
Credit Agreement”), among Holdings, the Company, each other Grantor, the lenders
from time to time party thereto, Barclays, as administrative agent (the “First
Lien Administrative Agent”), Barclays, as collateral agent (the “First Lien
Security Agent”) and the other parties referred to therein;

WHEREAS, pursuant to the various First Lien Documents, (i) the Grantors are
either borrowers of, or have provided guarantees for, the First Lien Obligations
and (ii) certain of the Grantors have provided security for the First Lien
Obligations;

WHEREAS, Holdings, the Company and each other Grantor may, after the date
hereof, enter into one or more Additional Second Lien Obligations Agreements;

WHEREAS, pursuant to the various Second Lien Documents, (i) certain of the
Grantors may provide guarantees for the Second Lien Obligations and (ii) certain
of the Grantors may provide security for the Second Lien Obligations;

WHEREAS, the Company and the other Grantors intend to secure the Revolving
Facility Obligations under the Revolving Facility Credit Agreement and any other
Revolving Facility Documents (in each case, including any Permitted Refinancing
thereof) with a First Priority Lien on the Revolving Facility Priority
Collateral and a Third Priority Lien (or a Second Priority Lien at all times
prior to the issuance of any Additional Second Lien Obligations) on the Notes
Priority Collateral;

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

WHEREAS, the Company and the other Grantors intend to secure the First Lien
Obligations under the First Lien Credit Agreement and any other First Lien
Documents (in each case, including any Permitted Refinancing thereof) with a
First Priority Lien on the Notes Priority Collateral and a Second Priority Lien
on the Revolving Facility Priority Collateral;

WHEREAS, the Company and the other Grantors intend to secure the Second Lien
Obligations under any Additional Second Lien Obligations Agreement and any other
Second Lien Documents (in each case, including any Permitted Refinancing
thereof) with a Second Priority Lien on the Notes Priority Collateral and a
Third Priority Lien on the Revolving Facility Priority Collateral.

NOW, THEREFORE, in consideration of the premises and the agreements, provisions
and covenants herein contained, the parties hereto agree as follows:

 

Section 1. Definitions.

1.1. Defined Terms. The following terms when used in this Agreement, including
its preamble and recitals, shall have the following meanings:

“Account” shall have the meaning set forth in Article 9 of the UCC.

“Additional First Lien Obligations” means obligations with respect to
Indebtedness of the Company or any other applicable Grantor arising after the
date of this Agreement intended to be secured by Liens on the Collateral ranking
pari passu in right of security with the Liens securing the First Lien
Obligations and documented in an agreement other than any agreement governing
any then extant First Lien Obligations (which additional obligations, for the
absence of doubt, may include any “Incremental Facilities”, “Additional
Revolving Facilities”, “Replacement Revolving Facilities” and/or “Replacement
Term Loans” (each, as defined in the First Lien Credit Agreement)) to the extent
(a) such Indebtedness is not expressly prohibited by the terms of the First Lien
Credit Agreement, the Revolving Facility Credit Agreement and each then extant
Additional First Lien Obligations Agreement and Additional Second Lien
Obligations Agreement from being secured by Liens on the Collateral ranking pari
passu in right of security with the Liens securing the First Lien Obligations,
(b) the Grantors have granted Liens on the Collateral to secure the obligations
in respect of such Indebtedness and (c) the applicable Additional First Lien
Obligations Agent, for the holders of such indebtedness, has entered into (I) an
Intercreditor Agreement Joinder on behalf of the holders of such indebtedness
pursuant to Section 8.19 and (II) a First Lien Parity Intercreditor Agreement,
in each case, acknowledging that such holders shall be bound by the terms hereof
and thereof applicable to First Lien Secured Parties.

“Additional First Lien Obligations Agent” means each Person appointed to act as
trustee, agent or representative for the holders of the applicable Additional
First Lien Obligations pursuant to any Additional First Lien Obligations
Agreement.

“Additional First Lien Obligations Agreement” means (i) the indenture, credit
agreement or other agreement under which any Additional First Lien Obligations
are incurred that are designated as Additional First Lien Obligations pursuant
to Section 8.19 and (ii) any other

 

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“Loan Documents” or “Financing Documents” (or similar term as may be defined or
referred to in the foregoing or other agreements, documents and instruments
executed in connection therewith, in each case, as Refinanced from time to time
in accordance with the terms thereof and hereof).

“Additional First Lien Obligations Secured Parties” means, at any relevant time,
the lenders, creditors and secured parties under any Additional First Lien
Obligations Agreements, any Additional First Lien Obligations Agent and the
other agents under any Additional First Lien Obligations Agreement, in each
case, in their capacities as such.

“Additional Lien Obligations” means, collectively, the Additional First Lien
Obligations and the Additional Second Lien Obligations.

“Additional Lien Obligations Agent” means the Additional First Lien Obligations
Agent and/or the Additional Second Lien Obligations Agent, as applicable.

“Additional Second Lien Obligations” means obligations with respect to
Indebtedness of the Company or any other applicable Grantor arising after the
date of this Agreement and intended to be secured by Second Priority Liens on
the Notes Priority Collateral and by Third Priority Liens on the Revolving
Facility Priority Collateral to the extent (a) such Indebtedness is not
expressly prohibited by the terms of the First Lien Credit Agreement, the
Revolving Facility Credit Agreement and each then extant Additional First Lien
Obligations Agreement and Additional Second Lien Obligations Agreement from
being secured by such Liens and Liens on the Collateral ranking, if applicable,
pari passu in right of security with the Liens securing any other Second Lien
Obligations, (b) the Grantors have granted Liens on the Collateral to secure the
obligations in respect of such Indebtedness and (c) the applicable Additional
Second Lien Obligations Agent, for the holders of such indebtedness, has entered
into (I) an Intercreditor Agreement Joinder on behalf of the holders of such
indebtedness pursuant to Section 8.19 and (II) to the extent there are any then
extant Second Lien Obligations then outstanding, a Second Lien Parity
Intercreditor Agreement, in each case, acknowledging that such holders shall be
bound by the terms hereof and thereof applicable to Second Lien Secured Parties.

“Additional Second Lien Obligations Agent” means each Person appointed to act as
trustee, agent or representative for the holders of the applicable Additional
Second Lien Obligations pursuant to any Additional Second Lien Obligations
Agreement.

“Additional Second Lien Obligations Agreement” means (i) the indenture, credit
agreement or other agreement under which any Additional Second Lien Obligations
are incurred that are designated as Additional Second Lien Obligations pursuant
to Section 8.19 and (ii) any other “Loan Documents” or “Financing Documents” (or
similar term as may be defined or referred to in the foregoing or other
agreements, documents and instruments executed in connection therewith, in each
case, as Refinanced from time to time in accordance with the terms thereof and
hereof).

“Administrative Agents” shall mean the Revolving Facility Agent, the First Lien
Administrative Agent and each Additional Second Lien Obligations Agent.

 

-3-

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“Agents” shall mean the Administrative Agents and the Security Agents.

“Agreement” shall mean this Intercreditor Agreement.

“Bank of America” shall have the meaning set forth in the introductory paragraph
hereof.

“Bankruptcy Code” shall mean Title 11 of the United States Code entitled
“Bankruptcy.”

“Barclays” shall have the meaning set forth in the introductory paragraph
hereof.

“Borrowing Base” means the sum of (i) 85% of the book value of accounts
receivable of Holdings and its Subsidiaries on a consolidated basis plus
(ii) 60% of the book value of the inventory of Holdings and its Subsidiaries on
a consolidated basis.

“Business Day” shall mean any day that is not a Saturday or Sunday or any other
day on which commercial banks in New York City are authorized or required by law
to close.

“Capital Lease” shall mean, as applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee that, in conformity
with GAAP, is or is required to be accounted for as a capital lease on the
balance sheet of that Person.

“Capital Stock” shall mean any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation),
including partnership interests and membership interests, and any and all
warrants, rights or options to purchase or other arrangements or rights to
acquire any of the foregoing, but excluding for the avoidance of doubt any
Indebtedness convertible into or exchangeable for any of the foregoing.

“Cash” shall mean money, currency or a credit balance in any demand or Deposit
Account.

“Cash Proceeds” shall mean all Proceeds of any Collateral received by any
Grantor or Secured Party consisting of Cash and checks.

“Chattel Paper” shall have the meaning set forth in Article 9 of the UCC.
Without limiting the foregoing, the term “Chattel Paper” shall in any event
include all Tangible Chattel Paper and all Electronic Chattel Paper.

“Collateral” shall mean, collectively for all Grantors, any and all property of
each Grantor subject to a Lien under the Security Documents and any and all
other property of such Grantor, now existing or hereafter acquired, that is or
becomes subject to a Lien pursuant to any of the Security Documents.

“Collateral Support” shall mean all property (real or personal) collaterally
assigned for the purpose of, hypothecated or otherwise securing any Collateral
and shall include any security agreement or other agreement granting a Lien or
security interest in such real or personal property.

 

-4-

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“Commercial Tort Claim” shall have the meaning set forth in Article 9 of the
UCC.

“Commodity Account” shall have the meaning set forth in Article 9 of the UCC.

“Company” shall have the meaning set forth in the introductory paragraph hereof.

“Comparable First Lien Security Document” shall mean, in relation to any
Collateral subject to any Lien created under any Revolving Facility Security
Document, that First Lien Document which creates (or purports to create) a Lien
on the same Collateral, granted by the same Grantor, as the same may be
Refinanced from time to time in accordance with the terms hereof, thereof and
the Credit Agreements.

“Comparable Revolving Facility Security Document” shall mean, in relation to any
Collateral subject to any Lien created under any First Lien Security Document or
Second Lien Security Document, that Revolving Facility Document which creates
(or purports to create) a Lien on the same Collateral, granted by the same
Grantor, as the same may be Refinanced from time to time in accordance with the
terms hereof, thereof and the Credit Agreements.

“Comparable Second Lien Security Document” shall mean, in relation to any
Collateral subject to any Lien created under any Revolving Facility Security
Document or First Lien Security Document, that Second Lien Document which
creates (or purports to create) a Lien on the same Collateral, granted by the
same Grantor, as the same may be Refinanced from time to time in accordance with
the terms hereof, thereof and the Credit Agreements.

“Copyrights” shall mean, with respect to any Grantor, all of such Grantor’s
right, title, and interest in and to the following: (a) all copyrights, rights
and interests in copyrights, works protectable by copyright whether published or
unpublished, copyright registrations, and copyright applications; (b) all
renewals of any of the foregoing; (c) all income, royalties, damages, and
payments now or hereafter due and/or payable under any of the foregoing,
including damages or payments for past or future infringements for any of the
foregoing; (d) the right to sue for past, present, and future infringements of
any of the foregoing; and (e) all domestic rights corresponding to any of the
foregoing.

“Credit Agreements” shall mean the Revolving Facility Credit Agreement, the
First Lien Credit Agreement and each Additional Second Lien Obligations
Agreement.

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

 

-5-

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“Defaulting First Lien Secured Party” shall have the meaning set forth in
Section 3.4(l)(iv).

“Defaulting Revolving Facility Secured Party” shall have the meaning set forth
in Section 4.4(j)(iv).

“Deposit Account” shall have the meaning set forth in Article 9 of the UCC.

“Derivative Transaction” means (a) any interest-rate transaction, including any
interest-rate swap, basis swap, forward rate agreement, interest rate option
(including a cap, collar or floor), and any other instrument linked to interest
rates that gives rise to similar credit risks (including when-issued securities
and forward deposits accepted), (b) any exchange-rate transaction, including any
cross-currency interest-rate swap, any forward foreign-exchange contract, any
currency option, and any other instrument linked to exchange rates that gives
rise to similar credit risks, (c) any equity derivative transaction, including
any equity-linked swap, any equity-linked option, any forward equity-linked
contract, and any other instrument linked to equities that gives rise to similar
credit risk and (d) any commodity (including precious metal) derivative
transaction, including any commodity-linked swap, any commodity-linked option,
any forward commodity-linked contract, and any other instrument linked to
commodities that gives rise to similar credit risks; provided that no phantom
stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees, members of
management, managers or consultants of Holdings or its subsidiaries shall be a
Derivative Transaction.

“Directing First Lien Security Agent” means (a) the First Lien Security Agent
unless (and until) the Discharge of First Lien Obligations has occurred solely
with respect to the First Lien Obligations under the First Lien Credit Agreement
and the First Lien Documents with respect thereto and (b) thereafter, the First
Lien Security Agent designated in writing by the holders of a majority of the
then outstanding principal amount of the First Lien Obligations to, from time to
time, act as Directing First Lien Security Agent hereunder.

“Directing Second Lien Security Agent” means (a) from such time as Additional
Second Lien Obligations are first incurred under any Additional Second Lien
Obligations Agreement, the Additional Second Lien Obligations Agent with respect
to such Additional Second Lien Obligations unless (and until) the Discharge of
Second Lien Obligations has occurred solely with respect to the Additional
Second Lien Obligations under such Additional Second Lien Obligations Agreement
and the Second Lien Documents with respect thereto, and (b) thereafter, the
Second Lien Security Agent designated in writing by the holders of a majority of
the then outstanding principal amount of the Second Lien Obligations to, from
time to time, act as Directing Second Lien Security Agent hereunder.

“Directing Security Agent” means any of the Directing First Lien Security Agent,
the Revolving Facility Agent or the Directing Second Lien Security Agent, as the
case may be.

“Discharge of First Lien Obligations” shall mean, except to the extent otherwise
provided in Section 3.4(j), the occurrence of all of the following:

(i) termination or expiration of all commitments to extend credit that would
constitute (prior to such termination or expiration) First Lien Priority
Obligations;

 

-6-

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(ii) payment in full in cash of the outstanding principal of, and interest
(including any Post-Petition Interest) and premium (if any) in respect of, all
First Lien Priority Obligations (other than any undrawn letters of credit);

(iii) discharge, cash collateralization or back-stopping (in an amount equal to
103% of the aggregate undrawn amount) of all outstanding letters of credit
constituting First Lien Priority Obligations;

(iv) payment in full in cash of all other First Lien Priority Obligations that
are outstanding and unpaid at the time the termination, expiration, cash
collateralization and/or back-stopping set forth in clauses (i) through
(iii) above have occurred (other than any obligations for taxes, costs,
indemnifications and other contingent liabilities in respect of which no claim
or demand for payment has been made at such time); and

(v) adequate provision has been made for any contingent or unliquidated First
Lien Priority Obligations for which a claim has been made against (or identified
by) the First Lien Secured Parties and indemnification or payment is required
under the First Lien Documents, including First Lien Bank Product Obligations
and First Lien Secured Hedging Obligations; provided that the Discharge of First
Lien Obligations shall not be deemed to have occurred if such payments are made
with the proceeds of other First Lien Priority Obligations that constitute an
exchange or replacement for or a Refinancing of such First Lien Priority
Obligations.

Upon the satisfaction of the conditions set forth in clauses (i) through
(v) with respect to any First Lien Priority Obligations, the applicable First
Lien Security Agent agrees to promptly deliver to the other First Lien Security
Agents, the Revolving Facility Agent and the Second Lien Security Agents written
notice of the same.

“Discharge of Revolving Facility Obligations” shall mean, except to the extent
otherwise provided in Section 4.4(i), the occurrence of all of the following:

(i) termination or expiration of all commitments to extend credit that would
constitute (prior to such termination or expiration) Revolving Facility Priority
Obligations;

(ii) payment in full in cash of the outstanding principal of, and interest
(including any Post-Petition Interest) and premium (if any) in respect of, all
Revolving Facility Priority Obligations (other than any undrawn letters of
credit);

(iii) discharge, cash collateralization or back-stopping (in an amount equal to
103% of the aggregate undrawn amount) of all outstanding letters of credit
constituting Revolving Facility Priority Obligations;

(iv) payment in full in cash of all other Revolving Facility Priority
Obligations that are outstanding and unpaid at the time the termination,
expiration, discharge, cash

 

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collateralization and/or back-stopping set forth in clauses (i) through
(iii) above have occurred (other than any obligations for taxes, costs,
indemnifications and other contingent liabilities in respect of which no claim
or demand for payment has been made at such time); and

(v) adequate provision has been made for any contingent or unliquidated
Revolving Facility Obligations for which a claim has been made against (or
identified by) the Revolving Facility Secured Parties and indemnification or
payment is required under the Revolving Facility Documents, including Revolving
Facility Bank Product Obligations and Revolving Facility Secured Hedging
Obligations; provided that the Discharge of Revolving Facility Obligations shall
not be deemed to have occurred if such payments are made with the proceeds of
other Revolving Facility Priority Obligations that constitute an exchange or
replacement for or a Refinancing of such Revolving Facility Priority
Obligations.

Upon the satisfaction of the conditions set forth in clauses (i) through
(v) with respect to any Revolving Facility Priority Obligations, the Revolving
Facility Agent agrees to promptly deliver to the First Lien Security Agents and
the Second Lien Security Agents written notice of the same.

“Discharge of Second Lien Obligations” shall mean, except to the extent
otherwise provided in Section 3.4(k), if any Additional Second Lien Obligations
have been issued, the occurrence of all of the following:

(i) termination or expiration of all commitments to extend credit that would
constitute (prior to such termination or expiration) Second Lien Priority
Obligations;

(ii) payment in full in cash of the outstanding principal of, and interest
(including any Post-Petition Interest) and premium (if any) in respect of, all
Second Lien Priority Obligations;

(iii) payment in full in cash of all other Second Lien Priority Obligations that
are outstanding and unpaid at the time the termination, expiration and/or
discharge set forth in clauses (i) and (ii) above have occurred (other than any
obligations for taxes, costs, indemnifications and other contingent liabilities
in respect of which no claim or demand for payment has been made at such time);
and

(iv) adequate provision has been made for any contingent or unliquidated Second
Lien Priority Obligations for which a claim has been made against (or identified
by) the Second Lien Secured Parties and indemnification or payment is required
under the Second Lien Documents; provided that the Discharge of Second Lien
Obligations shall not be deemed to have occurred if such payments are made with
the proceeds of other Second Lien Priority Obligations that constitute an
exchange or replacement for or a Refinancing of such Second Lien Priority
Obligations.

Upon the satisfaction of the conditions set forth in clauses (i) through
(iv) with respect to any Second Lien Priority Obligation, the applicable Second
Lien Security Agent agrees to promptly deliver to the other Second Lien Security
Agents, the Revolving Facility Agent and the First Lien Security Agents written
notice of the same.

 

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“Document” shall have the meaning set forth in Article 9 of the UCC.

“Domestic Subsidiary” shall mean any Subsidiary incorporated or organized under
the laws of the U.S., any State thereof or the District of Columbia.

“Electronic Chattel Paper” shall have the meaning set forth in Article 9 of the
UCC.

“Eligible First Lien Purchaser” shall have the meaning set forth in
Section 3.4(l).

“Eligible Revolving Facility Purchaser” shall have the meaning set forth in
Section 4.4(j).

“Equipment” shall have the meaning set forth in Article 9 of the UCC.

“Excess First Lien Obligations” shall mean any Indebtedness and other
obligations that would constitute First Lien Priority Obligations but for the
exclusion therefrom pursuant to the proviso in the definition of “First Lien
Obligations”.

“Excess Revolving Facility Obligations” shall mean any Indebtedness and other
obligations that would constitute Revolving Facility Priority Obligations but
for the exclusion therefrom pursuant to the proviso in the definition of
“Revolving Facility Obligations”.

“Excess Second Lien Obligations” shall mean any Indebtedness and other
obligations that would constitute Second Lien Priority Obligations but for the
exclusion therefrom pursuant to the proviso in the definition of “Second Lien
Obligations”.

“First Lien” shall mean any Lien created by the First Lien Security Documents.

“First Lien Administrative Agent” shall have the meaning set forth in the
recitals hereto.

“First Lien Bank Product Agreements” shall mean each agreement or other document
governing or evidencing First Lien Bank Product Obligations.

“First Lien Bank Product Creditor” shall mean each provider of “Banking
Services” (as that term is defined in the First Lien Credit Agreement (as in
effect on the date hereof)).

“First Lien Bank Product Obligations” shall mean the “Banking Services
Obligations” (as that term is defined in the First Lien Credit Agreement (as in
effect on the date hereof)) which are designated under the First Lien Credit
Agreement by the First Lien Bank Product Creditor in writing to the First Lien
Administrative Agent as First Lien Obligations and are not also Revolving
Facility Obligations.

“First Lien Credit Agreement” shall have the meaning set forth in the recitals
hereto.

 

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“First Lien Debt Cap” shall mean the result of (i) $350,000,000, plus (ii) the
product of (x) such additional amounts permitted to be incurred by the Company
and/or the other Grantors under, or pursuant to, all “Incremental Facilities”
and “Incremental Equivalent Debt” (each, as defined in the First Lien Credit
Agreement) pursuant to Section 2.21, Section 2.22, Section 9.02(c) and
Section 6.01(x) of the First Lien Credit Agreement (as in effect on the date
hereof) or pursuant to any similar terms in any Additional First Lien
Obligations Agreement and any similar or corresponding provisions in any
Refinancing thereof to the extent such similar or corresponding provisions do
not permit an aggregate principal amount of Indebtedness in excess of an amount
permitted under the First Lien Credit Agreement (as in effect on the date
hereof) multiplied by (y) 115%, plus (iii) the amount of any accrued and unpaid
interest, paid in kind amounts and premium on any Indebtedness under the First
Lien Credit Agreement or any Additional First Lien Obligations Agreement added
to principal in connection with a Permitted Refinancing thereof plus fees and
expenses incurred in connection therewith, minus (iv) the aggregate amount of
all mandatory prepayments of the principal of the First Lien Obligations under
the First Lien Documents (pursuant to any asset sale or condemnation event
(subject, to the extent such First Lien Obligations represent revolving loans,
to permanent reductions of the revolving commitments with respect thereto) but
excluding any mandatory prepayment of such First Lien Obligations in connection
with a Permitted Refinancing thereof). For the avoidance of doubt, First Lien
Bank Product Obligations and First Lien Secured Hedging Obligations shall not be
subject to the First Lien Debt Cap.

“First Lien DIP Financing” shall have the meaning set forth in Section 3.5(a).

“First Lien Documents” shall mean (x) the First Lien Credit Agreement and the
other Loan Documents (as defined in the First Lien Credit Agreement), (y) each
First Lien Secured Hedging Agreement and First Lien Bank Product Agreement and
(z) each of the other agreements, documents and instruments (including any
Additional First Lien Obligations Agreement) providing for or evidencing any
First Lien Obligation (including any Permitted Refinancing of any First Lien
Obligation), as each may be Refinanced from time to time in accordance with the
provisions of this Agreement (but excluding, for the avoidance of doubt, any
documents entered into in connection with a Revolving Facility DIP Financing, a
First Lien DIP Financing or a First Lien Revolving Facility Priority Collateral
DIP Financing). It being understood that for purposes of Section 3.4(e), the
term “First Lien Documents” shall not include any First Lien Secured Hedging
Agreement or First Lien Bank Product Agreement or any other agreements of the
type described in clause (z) relating to agreements described in clause (y) of
the foregoing sentence.

“First Lien Obligations” shall mean (a) all obligations (including guaranty
obligations) of every nature of each Grantor, from time to time owed to the
First Lien Secured Parties or any of them, under any First Lien Document
(including any First Lien Document in respect of a Permitted Refinancing of any
First Lien Obligations), including all “Secured Obligations” or similar term as
defined in the First Lien Credit Agreement and whether for principal, premium,
interest (including interest and fees which, but for the filing of a petition in
bankruptcy with respect to such Person, would have accrued on any First Lien
Obligation (including any Permitted Refinancing of any First Lien Obligations)
at the rate provided in the respective documentation, whether or not a claim is
allowed against Holdings or any of its

 

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Subsidiaries for such interest in the related bankruptcy proceeding),
reimbursement of amounts drawn under (and obligations to cash collateralize)
letters of credit, fees, expenses, indemnification or otherwise and (b) First
Lien Bank Product Obligations and First Lien Secured Hedging Obligations;
provided that if the sum of: (i) the aggregate principal amount of Indebtedness
for borrowed money of Holdings and its Subsidiaries then outstanding under the
First Lien Credit Agreement and the other First Lien Documents (but excluding,
for the avoidance of doubt, any First Lien Secured Hedging Agreements and First
Lien Bank Product Agreements); plus (ii) the aggregate face amount of any
letters of credit issued but not reimbursed under the First Lien Documents is in
excess of the First Lien Debt Cap, then only that portion of such aggregate
principal amount of Indebtedness for borrowed money and such aggregate face
amount of unreimbursed letters of credit not in excess of the First Lien Debt
Cap shall be deemed to be First Lien Priority Obligations, and interest and
reimbursement obligations with respect to such Indebtedness and letters of
credit shall only constitute First Lien Priority Obligations to the extent
related to Indebtedness and unreimbursed letters of credit otherwise included in
the First Lien Priority Obligations.

“First Lien Parity Intercreditor Agreement” shall mean an agreement among each
First Lien Representative allocating rights among the various First Lien Secured
Parties.

“First Lien Permitted Liens” shall mean the “Permitted Liens” under, and as
defined in, the First Lien Credit Agreement.

“First Lien Pledge and Security Agreement” shall mean that certain Pledge and
Security Agreement dated as of the date hereof, among the Company, each other
Grantor and the First Lien Security Agent.

“First Lien Priority Obligations” shall mean all First Lien Obligations
exclusive of the Excess First Lien Obligations.

“First Lien Purchase Option” shall have the meaning set forth in Section 3.4(l).

“First Lien Purchase Option Period” shall have the meaning set forth in
Section 4.4(j)(iii).

“First Lien Representative” shall mean (i) in the case of the First Lien Credit
Agreement, the First Lien Administrative Agent and (ii) in the case of any
Additional First Lien Obligations, the applicable Additional First Lien
Obligations Agent.

“First Lien Revolving Facility Priority Collateral DIP Financing” shall have the
meaning set forth in Section 4.5(b).

“First Lien Secured Hedging Agreement” shall mean any Hedge Agreement with
respect to Secured Hedging Obligations (as each such term is (and the component
definitions as used therein are) defined in the First Lien Credit Agreement (as
in effect on the date hereof)).

“First Lien Secured Hedging Creditor” shall mean each counterparty to any First
Lien Secured Hedging Agreement (other than a Grantor).

 

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“First Lien Secured Hedging Obligations” shall mean any Secured Hedging
Obligations (as each such term is (and the component definitions as used therein
are) defined in the First Lien Credit Agreement (as in effect on the date
hereof)) which are designated under the First Lien Credit Agreement by the First
Lien Secured Hedging Creditor in writing to the First Lien Administrative Agent
as First Lien Obligations and are not also Revolving Facility Obligations.

“First Lien Secured Parties” shall mean (a) the lenders (including, in any
event, each letter of credit issuer and each swingline lender), agents and
arrangers under the First Lien Credit Agreement and shall include all former
lenders, agents and arrangers under the First Lien Credit Agreement to the
extent that any First Lien Obligations owing to such Persons were incurred while
such Persons were lenders, agents or arrangers under the First Lien Credit
Agreement and, as of any date of determination, such First Lien Obligations have
not been paid or satisfied in full in accordance with the terms of the First
Lien Documents, (b) the First Lien Secured Hedging Creditors, (c) the First Lien
Bank Product Creditors, (d) all new First Lien Secured Parties joining as a
party hereto to the extent set forth in Section 3.4(j) and (e) any Additional
First Lien Obligations Secured Parties, if any.

“First Lien Security Agent” shall have the meaning set forth in the recitals
hereto and includes any (a) New First Lien Agent to the extent set forth in
Section 3.4(j) and (b) Additional First Lien Obligations Agent.

“First Lien Security Documents” shall mean the First Lien Pledge and Security
Agreement, the other Collateral Documents (as defined in the First Lien Credit
Agreement) and any other agreement, document or instrument pursuant to which a
Lien is granted securing any First Lien Obligations (including any Permitted
Refinancing of any First Lien Obligation) or under which rights or remedies with
respect to such Liens are governed.

“First Lien Standstill Period” shall have the meaning set forth in
Section 4.1(a)(i).

“First Priority” shall mean,

(i) with respect to any Lien purported to be created on any Revolving Facility
Priority Collateral pursuant to any Revolving Facility Security Document, that
such Lien is prior in right to any other Lien thereon, other than any Revolving
Facility Permitted Liens (excluding Revolving Facility Permitted Liens of the
type described in Section 6.02(l) of the Revolving Facility Credit Agreement as
in effect on the date hereof) applicable to such Revolving Facility Priority
Collateral which are permitted under the Revolving Facility Documents to have
priority over or to be pari passu with the Revolving Facility Agent’s Lien in
the Revolving Facility Priority Collateral; and

(ii) with respect to any Lien purported to be created on any Notes Priority
Collateral pursuant to any First Lien Security Document, that such Lien is prior
in right to any other Lien thereon, other than any First Lien Permitted Liens
(excluding the First Lien Permitted Liens of the type described in
Section 6.02(t) (as it relates to Section 6.01(v) only) of the First Lien Credit
Agreement (as in effect on the date hereof)) applicable to such Notes Priority
Collateral which are permitted under the First Lien Documents to have priority
over or to be pari passu with the respective Liens on such Notes Priority
Collateral created pursuant to the relevant First Lien Security Document.

 

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“Fixtures” shall have the meaning set forth in Article 9 of the UCC.

“GAAP” shall mean generally accepted accounting principles in the United States
of America as in effect from time to time.

“General Intangible” shall have the meaning set forth in Article 9 of the UCC.

“Governmental Authority” means any federal, state, municipal, national or other
government, governmental department, commission, board, bureau, court, agency or
instrumentality or political subdivision thereof or any entity or officer
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to any government or any court, in each case whether
associated with a state or locality of the U.S., the U.S., or a foreign
government.

“Grantors” shall mean (i) the Company and each of the Company’s Domestic
Subsidiaries that have executed and delivered, or may from time to time
hereafter execute and deliver, a Revolving Facility Security Document, a First
Lien Security Document or a Second Lien Security Document, and (ii) Holdings, to
the extent that it has executed and delivered, or may from time to time
hereafter execute and deliver, a Revolving Facility Security Document, a First
Lien Security Document or a Second Lien Security Document.

“Hedge Agreement” shall mean any agreement with respect to any Derivative
Transaction between any Grantor or any Subsidiary and any other Person.

“Holdings” shall have the meaning set forth in the introductory paragraph
hereof.

“Indebtedness” means and includes all First Lien Obligations, Second Lien
Obligations and Revolving Facility Obligations, as applicable, that constitute
“Indebtedness” within the meaning of the First Lien Credit Agreement, any
Additional Second Lien Obligations Agreement and the Revolving Facility Credit
Agreement, respectively. For the avoidance of doubt, “Indebtedness” shall not
include any First Lien Obligations under any First Lien Secured Hedging
Agreement or First Lien Bank Product Agreement or any Revolving Facility
Obligations under any Revolving Facility Secured Hedging Agreement or Revolving
Facility Bank Product Agreement.

“Insolvency or Liquidation Proceeding” shall mean any of the following: (i) the
filing by any Grantor of a voluntary petition in bankruptcy under any provision
of any Debtor Relief Law (including the Bankruptcy Code) or a petition to take
advantage of any receivership or insolvency laws, including any petition seeking
the dissolution, winding up, total or partial liquidation, reorganization,
composition, arrangement, adjustment or readjustment or other relief of such
Grantor, such Grantor’s debts or such Grantor’s assets or the appointment of a
trustee, receiver, liquidator, custodian or similar official for such Grantor or
a material part of such Grantor’s property; (ii) the appointment of a receiver,
liquidator, trustee, custodian or other similar official for such Grantor or all
or a material part of such Grantor’s assets; (iii) the filing of

 

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any petition against such Grantor under any Debtor Relief Law (including the
Bankruptcy Code) or other receivership or insolvency law, including any petition
seeking the dissolution, winding up, total or partial liquidation,
reorganization, composition, arrangement, adjustment or readjustment or other
relief of such Grantor, such Grantor’s debts or such Grantor’s assets or the
appointment of a trustee, receiver, liquidator, custodian or similar official
for such Grantor or a material part of such Grantor’s property; or (iv) the
general assignment by such Grantor for the benefit of creditors or any other
marshalling of the assets and liabilities of such Grantor.

“Insurance” shall mean (i) all insurance policies covering any or all of the
Collateral (regardless of whether the Revolving Facility Agent, the First Lien
Security Agent or the Second Lien Security Agent is the loss payee or additional
insured thereof) and (ii) any key man life insurance policies.

“Intellectual Property” shall mean any and all Licenses, Patents, Copyrights,
Trademarks and Trade Secrets constituting Collateral.

“Intercreditor Agreement Joinder” shall mean an agreement substantially in the
form of Exhibit A hereto.

“Instrument” shall have the meaning set forth in Article 9 of the UCC.

“Inventory” shall have the meaning set forth in Article 9 of the UCC.

“Investment Property” shall have the meaning set forth in Article 9 of the UCC.

“Letter-of-Credit Rights” shall have the meaning set forth in Article 9 of the
UCC.

“Licenses” shall mean, with respect to any Grantor, all of such Grantor’s right,
title, and interest in and to (a) any and all licensing agreements or similar
arrangements in and to its owned (1) Patents, (2) Copyrights, (3) Trademarks,
(4) Trade Secrets or (5) Software, (b) all income, royalties, damages, claims,
and payments now or hereafter due or payable under and with respect thereto,
including damages and payments for past and future breaches thereof, and (c) all
rights to sue for past, present, and future breaches thereof.

“Lien” shall mean any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or preference,
priority or other security interest or preferential arrangement of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement, any easement, right of way or other encumbrance on title to real
property, and any Capital Lease having substantially the same economic effect as
any of the foregoing) in each case, in the nature of security; provided that in
no event shall an operating lease in and of itself be deemed a Lien.

“New Revolving Facility Agent” shall have the meaning set forth in
Section 4.4(i).

“New First Lien Agent” shall have the meaning set forth in Section 3.4(j).

“New Second Lien Agent” shall have the meaning set forth in Section 3.4(k).

 

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“Notes Priority Collateral” shall mean all interests of each Grantor in the
following Collateral, in each case whether now owned or existing or hereafter
acquired or arising and wherever located, including (1) all rights of each
Grantor to receive moneys due and to become due under or pursuant to the
following, (2) all rights of each Grantor to receive return of any premiums for
or Proceeds of any insurance, indemnity, warranty or guaranty with respect to
the following or to receive condemnation Proceeds with respect to the following,
(3) all claims of each Grantor for damages arising out of or for breach of or
default under any of the following, and (4) all rights of each Grantor to
terminate, amend, supplement, modify or waive performance under any of the
following, to perform thereunder and to compel performance and otherwise
exercise all remedies thereunder:

(i) the Term Proceeds Account, and all cash, money, securities, Instruments and
other investments or Investment Property deposited therein;

(ii) all Pledged Stock;

(iii) all Equipment;

(iv) all Fixtures;

(v) all Intellectual Property;

(vi) all real property (including, if any, leasehold interests) on which the
Grantors are required to provide a Lien to the First Lien Secured Parties
pursuant to the First Lien Credit Agreement and/or Second Lien Secured Parties
pursuant to any Additional Second Lien Obligations Agreement and any title
insurance with respect to such real property (other than title insurance
actually obtained by the Revolving Facility Agent in respect of such real
property) and the Proceeds thereof;

(vii) all Indebtedness owed by any Grantor or any of its subsidiaries to any
other Grantor to the extent such Indebtedness is funded from the proceeds of
loans or other advances made pursuant to any First Lien Document or Second Lien
Document or from identifiable Proceeds of Notes Priority Collateral;

(viii) except to the extent constituting or relating to the Revolving Facility
Priority Collateral, all Commercial Tort Claims, Chattel Paper, General
Intangibles, letters of credit (whether or not the respective letter of credit
is evidenced by a writing), Letter-of-Credit Rights, Instruments, Documents,
Insurance, tax refunds and related tax payments, the proceeds of business
interruption insurance, Supporting Obligations and other personal property
(whether tangible or intangible) of such Grantor; provided that to the extent
any of the foregoing also relates to Revolving Facility Priority Collateral only
that portion related to the items referred to in the preceding clauses
(i) through (vii) as being included in Notes Priority Collateral shall be
included in the Notes Priority Collateral;

(ix) all books and records, customer lists, credit files, computer files,
programs, printouts and other computer materials and records related thereto and
any General Intangibles at any time evidencing or relating to any of the
foregoing; provided that to the extent

 

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any of such material also relates to Revolving Facility Priority Collateral only
that portion related to the items referred to in the preceding clauses
(i) through (viii) as being included in the Notes Priority Collateral shall be
included in the Notes Priority Collateral; and

(x) all Proceeds, products, accessions to, substitutions or replacements for,
rents and profits of or in respect of any of the foregoing and all collateral
security, guarantees and other Collateral Support given by any Person with
respect to any of the foregoing;

provided, however that (i) if Collateral of any type is received in exchange for
Revolving Facility Priority Collateral pursuant to an enforcement action or
during an Insolvency or Liquidation Proceeding, such Collateral will be treated
as Revolving Facility Priority Collateral and (ii) if Collateral of any type is
received in exchange for Notes Priority Collateral pursuant to an enforcement
action or during an Insolvency or Liquidation Proceeding, such Collateral will
be treated as Notes Priority Collateral.

“Notes Priority Collateral Enforcement Action Notice” shall have the meaning set
forth in Section 6.3(a).

“Notes Priority Collateral Enforcement Actions” shall have the meaning set forth
in Section 6.3(a).

“Patents” shall mean, with respect to any Grantor, all of such Grantor’s right,
title, and interest in and to: (a) any and all patents and patent applications;
(b) all inventions and improvements described and claimed therein; (c) all
reissues, divisions, continuations, renewals, extensions, and
continuations-in-part thereof; (d) all income, royalties, damages, claims, and
payments now or hereafter due or payable under and with respect thereto,
including damages and payments for past and future infringements thereof;
(e) all rights to sue for past, present, and future infringements thereof; and
(f) all domestic rights corresponding to any of the foregoing.

“Payment Intangibles” shall have the meaning assigned in Article 9 of the UCC.

“Permitted Refinancing” shall mean, with respect to any Indebtedness under the
First Lien Documents, the Second Lien Documents or the Revolving Facility
Documents, the Refinancing of such Indebtedness (“Refinancing Indebtedness”) in
accordance with the requirements of this Agreement, the First Lien Credit
Agreement, any Additional Second Lien Obligations Agreement and the Revolving
Facility Credit Agreement.

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

“Pledged Notes Priority Collateral” shall have the meaning set forth in
Section 3.4(h).

“Pledged Revolving Facility Priority Collateral” shall have the meaning set
forth in Section 4.4(g).

 

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“Pledged Stock” shall mean, with respect to any Grantor, the shares of Capital
Stock required to be pledged by such Grantor pursuant to any of the Revolving
Facility Pledge and Security Agreement, the First Lien Pledge and Security
Agreement or any Second Lien Security Documents (as applicable).

“Post-Petition Interest” shall mean interest, fees, expenses and other charges
that pursuant to the Revolving Facility Documents, First Lien Documents or
Second Lien Documents, as the case may be, continue to accrue after the
commencement of any Insolvency or Liquidation Proceeding, whether or not such
interest, fees, expenses and other charges are allowed or allowable under any
Debtor Relief Law or in any such Insolvency or Liquidation Proceeding.

“Proceeds” shall have the meaning assigned in Article 9 of the UCC and, in any
event, shall also include, but not be limited to, (i) any and all proceeds of
any insurance, indemnity, warranty or guaranty payable to any Agent or any
Grantor from time to time with respect to any of the Collateral, (ii) any and
all payments (in any form whatsoever) made or due and payable to any Grantor
from time to time in connection with any requisition, confiscation,
condemnation, seizure or forfeiture of all or any part of the Collateral by any
Governmental Authority (or any Person acting under color of Governmental
Authority), (iii) any and all Stock Rights and (iv) any and all other amounts
from time to time paid or payable under or in connection with any of the
Collateral.

“Recovery” shall have the meaning set forth in Section 6.17.

“Refinance” shall mean, in respect of any Indebtedness, to refinance, extend,
renew, retire, defease, restructure, replace, refund or repay, or to issue other
Indebtedness, in exchange or replacement for (including any amendment,
modification, supplement or amendment and restatement in a manner having the
same effect as a refinancing), such Indebtedness in whole or in part.
“Refinanced” and “Refinancing” shall have correlative meanings.

“Refinancing Indebtedness” shall have the meaning set forth in the definition of
“Permitted Refinancing”.

“Revolving Facility Agent” shall have the meaning set forth in the recitals
hereto and includes any New Revolving Facility Agent to the extent set forth in
Section 4.4(i).

“Revolving Facility Bank Product Agreements” shall mean each agreement or other
document governing or evidencing Revolving Facility Bank Product Obligations.

“Revolving Facility Bank Product Creditor” shall mean each provider of “Banking
Services” (as that term is defined in the Revolving Facility Credit Agreement
(as in effect on the date hereof)).

“Revolving Facility Bank Product Obligations” shall mean the “Banking Services
Obligations” (as that term is defined in the Revolving Facility Credit Agreement
(as in effect on the date hereof)).

 

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“Revolving Facility Credit Agreement” shall have the meaning set forth in the
recitals hereto.

“Revolving Facility Debt Cap” shall mean the result of (i) the greater of
(x) $431,250,000 and (y) the product of the Borrowing Base multiplied by 115%,
plus (ii) the amount of any accrued and unpaid interest, paid in kind amounts
and premium on any Indebtedness under the Revolving Facility Credit Agreement
added to principal in connection with a Permitted Refinancing thereof plus fees
and expenses incurred in connection therewith. For the avoidance of doubt,
Revolving Facility Bank Product Obligations and Revolving Facility Secured
Hedging Obligations shall not be subject to the Revolving Facility Debt Cap.

“Revolving Facility DIP Financing” shall have the meaning set forth in
Section 4.5(a).

“Revolving Facility Documents” shall mean (x) the Revolving Facility Credit
Agreement and the other Loan Documents (as defined in the Revolving Facility
Credit Agreement), (y) the Revolving Facility Bank Product Agreements and
Revolving Facility Secured Hedging Agreements and (z) each of the other
agreements, documents and instruments providing for or evidencing any Revolving
Facility Obligations (including any Permitted Refinancing of any Revolving
Facility Obligations), as each may be Refinanced from time to time in accordance
with the provisions of this Agreement (but excluding, for the avoidance of
doubt, any documents entered into in connection with a Revolving Facility DIP
Financing).

“Revolving Facility Hedging Creditor” shall mean each counterparty to any
Revolving Facility Secured Hedging Agreement (other than a Grantor).

“Revolving Facility Obligations” shall mean (a) all obligations (including
guaranty obligations) of every nature of each Grantor, from time to time owed to
the Revolving Facility Secured Parties or any of them, under any Revolving
Facility Document (including any Revolving Facility Document in respect of a
Permitted Refinancing of any Revolving Facility Obligations), including all
“Secured Obligations” or similar term as defined in the Revolving Facility
Credit Agreement and whether for principal, premium, interest (including
interest and fees which, but for the filing of a petition in bankruptcy with
respect to such Person, would have accrued on any Revolving Facility Obligation
(including any Permitted Refinancing of any Revolving Facility Obligations), at
the rate provided in the respective documentation, whether or not a claim is
allowed against Holdings or any of its Subsidiaries for such interest in the
related bankruptcy proceeding), reimbursement of amounts drawn under (and
obligations to cash collateralize) letters of credit, fees, expenses,
indemnification or otherwise, and (b) Revolving Facility Bank Product
Obligations and Revolving Facility Secured Hedging Obligations; provided that if
the sum of: (i) the aggregate principal amount of Indebtedness for borrowed
money of Holdings and its Subsidiaries then outstanding under the Revolving
Facility Credit Agreement and the other Revolving Facility Documents (but
excluding, for the avoidance of doubt, any Revolving Facility Secured Hedging
Agreements and Revolving Facility Bank Product Agreements); plus (ii) the
aggregate face amount of any letters of credit issued but not reimbursed under
the Revolving Facility Documents is in excess of the Revolving Facility Debt
Cap, then only that portion of such aggregate principal amount of Indebtedness
for borrowed money and such aggregate face amount

 

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of unreimbursed letters of credit not in excess of the Revolving Facility Debt
Cap shall be deemed to be Revolving Facility Priority Obligations, and interest
and reimbursement obligations with respect to such Indebtedness and letters of
credit shall only constitute Revolving Facility Priority Obligations to the
extent related to Indebtedness and unreimbursed letters of credit otherwise
included in the Revolving Facility Priority Obligations.

“Revolving Facility Permitted Liens” shall mean the Liens permitted under
Section 6.02 of the Revolving Facility Credit Agreement.

“Revolving Facility Pledge and Security Agreement” shall mean that certain
Amended and Restated Pledge and Security Agreement dated as of the date hereof,
among the Company, each other Grantor and the Revolving Facility Agent.

“Revolving Facility Priority Collateral” shall mean all interests of each
Grantor in the following Collateral, in each case whether now owned or existing
or hereafter acquired or arising and wherever located, including (1) all rights
of each Grantor to receive moneys due and to become due under or pursuant to the
following, (2) all rights of each Grantor to receive return of any premiums for
or Proceeds of any insurance, indemnity, warranty or guaranty with respect to
the following or to receive condemnation Proceeds with respect to the following,
(3) all claims of each Grantor for damages arising out of or for breach of or
default under any of the following, and (4) all rights of each Grantor to
terminate, amend, supplement, modify or waive performance under any of the
following, to perform thereunder and to compel performance and otherwise
exercise all remedies thereunder:

(i) all Accounts and Payment Intangibles, but for purposes of this clause
(i) excluding rights to payment for any property which specifically constitutes
Notes Priority Collateral which has been or is to be sold, leased, licensed,
assigned or otherwise disposed of; provided, however, that, for the avoidance of
doubt, all rights to payment arising from any sale of Inventory shall constitute
Revolving Facility Priority Collateral;

(ii) all Securities Accounts, Commodity Accounts and Deposit Accounts and all
other demand, deposit, time, savings, cash management, passbook and similar
accounts maintained with any bank or other financial institution and all cash,
money, securities, Instruments and other investments or Investment Property
deposited or required to be deposited in any of the foregoing (in each case,
other than the Term Proceeds Account, all monies, securities, Instruments and
other investments or Investment Property held in the Term Proceeds Account or
credited to the Term Proceeds Account which constitute Notes Priority
Collateral);

(iii) all Inventory;

(iv) all Indebtedness owed by any Grantor or any of its subsidiaries to any
other Grantor except to the extent such Indebtedness is funded from the proceeds
of loans or other advances made pursuant to any First Lien Document or Second
Lien Document or from identifiable Proceeds of Notes Priority Collateral;

(v) to the extent relating to, evidencing or governing any of the items referred
to in the preceding clauses (i) through (iv), all tax refunds and related tax
payments, proceeds of

 

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business interruption insurance, Commercial Tort Claims, Chattel Paper, General
Intangibles, letters of credit (whether or not the respective letter of credit
is evidenced by a writing), Letter-of-Credit Rights, Instruments, Documents,
Insurance and Supporting Obligations; provided that to the extent any of the
foregoing also relates to Notes Priority Collateral, only that portion related
to the items referred to in the preceding clauses (i) through (iv) as being
included in the Revolving Facility Priority Collateral shall be included in the
Revolving Facility Priority Collateral;

(vi) all books and records, customer lists, credit files, computer files,
programs, printouts and other computer materials and records related thereto and
any General Intangibles at any time evidencing or relating to any of the
foregoing; and

(vii) all Proceeds, products, accessions, rents and profits of or in respect of
any of the foregoing (including all Insurance Proceeds) and all collateral
security, guarantees and other Collateral Support given by any Person with
respect to any of the foregoing;

provided, however that (i) if Collateral of any type is received in exchange for
Revolving Facility Priority Collateral pursuant to an enforcement action or
during an Insolvency or Liquidation Proceeding, such Collateral will be treated
as Revolving Facility Priority Collateral and (ii) if Collateral of any type is
received in exchange for Notes Priority Collateral pursuant to an enforcement
action or during an Insolvency or Liquidation Proceeding, such Collateral will
be treated as Notes Priority Collateral.

“Revolving Facility Priority Collateral Enforcement Actions” shall have the
meaning set forth in Section 6.3(a).

“Revolving Facility Priority Collateral Processing and Sale Period” shall have
the meaning set forth in Section 6.3(a).

“Revolving Facility Priority Obligations” shall mean all Revolving Facility
Obligations exclusive of the Excess Revolving Facility Obligations.

“Revolving Facility/Second Lien Standstill Period” shall have the meaning set
forth in Section 3.2(a)(i).

“Revolving Facility Secured Hedging Agreement” shall mean any Swap Agreement
with respect to Swap Obligations that constitute Secured Obligations (as each
such term is (and the component definitions as used therein are) defined in the
Revolving Facility Credit Agreement (as in effect on the date hereof)).

“Revolving Facility Secured Hedging Obligations” shall mean any Swap Obligations
that constitute Secured Obligations (as each such term is (and the component
definitions as used therein are) defined in the Revolving Facility Credit
Agreement (as in effect on the date hereof)).

“Revolving Facility Secured Parties” shall mean (a) the lenders (including, in
any event, each letter of credit issuer and each swingline lender), agents and
arrangers under the

 

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Revolving Facility Credit Agreement and shall include all former lenders, agents
and arrangers under the Revolving Facility Credit Agreement to the extent that
any Revolving Facility Obligations owing to such Persons were incurred while
such Persons were lenders, agents or arrangers under the Revolving Facility
Credit Agreement and, as of any date of determination, such Revolving Facility
Obligations have not been paid or satisfied in full in accordance with the terms
of the Revolving Facility Documents, (b) the Revolving Facility Bank Product
Creditors, (c) all Revolving Facility Hedging Creditors and (d) all new
Revolving Facility Secured Parties joining as a party hereto to the extent set
forth in Section 4.4(i).

“Revolving Facility Security Documents” shall mean the Revolving Facility Pledge
and Security Agreement, the other Collateral Documents (as defined in the
Revolving Facility Credit Agreement) and any other agreement, document or
instrument pursuant to which a Lien is granted securing any Revolving Facility
Obligations (including any Permitted Refinancing of any Revolving Facility
Obligations) or under which rights or remedies with respect to such Liens are
governed.

“Revolving Facility Standstill Period” shall have the meaning set forth in
Section 3.1(a)(i).

“Second Lien” shall mean any Lien created by the Second Lien Security Documents.

“Second Lien Debt Cap” shall mean (i) the product of (x) the principal amount of
Indebtedness permitted to be incurred by the Company and/or the other Grantors
and secured by a Second Priority Lien pursuant to Section 6.01(m), (t), (u) and
(x) and Section 6.02(o), (t) and (ii) of the First Lien Credit Agreement and
Section 6.01(t) of the Revolving Credit Facility Agreement (in each case, as in
effect on the date hereof) and any corresponding provision in any Refinancing
thereof to the extent such corresponding provision does not permit an aggregate
principal amount of Indebtedness in excess of an amount permitted thereunder (as
in effect on the date hereof) multiplied by (y) 115%, plus (ii) the amount of
any accrued and unpaid interest, paid in kind amounts and premium on any
Indebtedness under any Additional Second Lien Obligations Agreement added to
principal in connection with a Permitted Refinancing thereof plus fees and
expenses incurred in connection therewith, minus (iii) the aggregate amount of
all mandatory prepayments, in each case, of the principal of the Second Lien
Obligations under any Additional Second Lien Obligations Agreement (pursuant to
any asset sale or condemnation event (subject, to the extent such Second Lien
Obligations represent revolving loans, to permanent reductions of the revolving
commitments with respect thereto) but excluding any mandatory prepayment of such
Second Lien Obligations in connection with a Permitted Refinancing thereof.

“Second Lien Documents” shall mean (x) any Additional Second Lien Obligations
Agreement and (y) each of the other agreements, documents and instruments
(including any other Additional Second Lien Obligations Agreement) providing for
or evidencing any Second Lien Obligation (including any Permitted Refinancing of
any Second Lien Obligation), as each may be Refinanced from time to time in
accordance with the provisions of this Agreement (but excluding, for the
avoidance of doubt, any documents or agreement entered into in connection with a
Revolving Facility DIP Financing, a First Lien DIP Financing or a First Lien
Revolving Facility Priority Collateral DIP Financing).

 

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“Second Lien/First Lien Revolving Facility Priority Collateral Standstill
Period” shall have the meaning set forth in Section 4.2(a)(i).

“Second Lien Obligations” shall mean all obligations (including guaranty
obligations) of every nature of each Grantor, from time to time owed to the
Second Lien Secured Parties or any of them, under any Second Lien Document
(including any Second Lien Document in respect of a Permitted Refinancing of any
Second Lien Obligations), including all “Secured Obligations” or similar term as
defined in any Additional Second Lien Obligations Agreement and whether for
principal, premium, interest (including interest which, but for the filing of a
petition in bankruptcy with respect to such Person, would have accrued on any
Second Lien Obligation (including any Permitted Refinancing of any Second Lien
Obligations) at the rate provided in the respective documentation, whether or
not a claim is allowed against Holdings or any of its Subsidiaries for such
interest in the related bankruptcy proceeding), fees, expenses, indemnification
or otherwise; provided that if the aggregate principal amount of Indebtedness
for borrowed money of Holdings and its Subsidiaries then outstanding under any
Additional Second Lien Obligations Agreement and the other Second Lien Documents
is in excess of the Second Lien Debt Cap, then only that portion of such
aggregate principal amount of Indebtedness for borrowed money not in excess of
the Second Lien Debt Cap shall be deemed to be Second Lien Priority Obligations
and interest and reimbursement obligations with respect to such Indebtedness
shall only constitute Second Lien Priority Obligations to the extent related to
Indebtedness otherwise included in the Second Lien Priority Obligations.

“Second Lien Parity Intercreditor Agreement” shall mean an agreement among each
Second Lien Representative allocating rights among the various Second Lien
Secured Parties.

“Second Lien Pledge and Security Agreement” shall mean any Comparable Second
Lien Security Document in relation to the First Lien Pledge and Security
Agreement and the Revolving Facility Pledge and Security Agreement.

“Second Lien Priority Obligations” shall mean all Second Lien Obligations
exclusive of the Excess Second Lien Obligations.

“Second Lien Purchase Option Period” shall have the meaning set forth in
Section 4.4(j)(iii).

“Second Lien Representative” shall mean in the case of any Additional Second
Lien Obligations, the applicable Additional Second Lien Obligations Agent.

“Second Lien Revolving Facility Priority Collateral Standstill Period” shall
have the meaning set forth in Section 4.1(a)(i).

“Second Lien Secured Parties” shall mean (a) the lenders, agents and arrangers
under any Additional Second Lien Obligations Agreement and shall include all
former lenders,

 

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agents and arrangers under any Additional Second Lien Obligations Agreement to
the extent that any Second Lien Obligations owing to such Persons were incurred
while such Persons were lenders, agents or arrangers under such Additional
Second Lien Obligations Agreement and, as of any date of determination, such
Second Lien Obligations have not been paid or satisfied in full in accordance
with the terms of the Second Lien Documents and (b) all additional Second Lien
Secured Parties joining as a party hereto to the extent set forth in
Section 3.4(k).

“Second Lien Security Agent” shall mean any (a) New Second Lien Agent to the
extent set forth in Section 3.4(k) and (b) Additional Second Lien Obligations
Agent.

“Second Lien Security Documents” shall mean the Second Lien Pledge and Security
Agreement and any other agreement, document or instrument pursuant to which a
Lien is granted securing any Second Lien Obligations (including any Permitted
Refinancing of any Second Lien Obligation) or under which rights or remedies
with respect to such Liens are governed, together with any amendments,
replacements, modifications, extensions, renewals or supplements to, or
restatements of, any of the foregoing.

“Second Lien Standstill Period” shall have the meaning set forth in
Section 3.1(a).

“Second Priority” shall mean,

(i) with respect to any Lien purported to be created on any Notes Priority
Collateral, that such Lien is prior in right to any other Lien thereon, other
than (x) Liens under First Lien Security Documents, (y) First Lien Permitted
Liens of the type permitted to be prior to the Liens on the Notes Priority
Collateral securing the First Lien Obligations in accordance with clause (ii) of
the definition “First Priority” contained herein and (z) any Lien on Notes
Priority Collateral that is permitted to be pari passu with the applicable
Agent’s Lien in the Notes Priority Collateral; and

(ii) with respect to any Lien purported to be created on any Revolving Facility
Priority Collateral pursuant to any First Lien Security Document, that such Lien
is prior in right to any other Lien thereon, other than (x) Liens under the
Revolving Facility Security Documents, (y) Revolving Facility Permitted Liens of
the type permitted to be prior to or pari passu with the Liens on the Revolving
Facility Priority Collateral in accordance with clause (i) of the definition
“First Priority” contained herein and (z) any Lien on Revolving Facility
Priority Collateral that is permitted to be pari passu with the First Lien
Security Agent’s Lien in the Revolving Facility Priority Collateral.

“Secured Parties” shall mean, collectively, the Revolving Facility Secured
Parties, the First Lien Secured Parties and the Second Lien Secured Parties.

“Securities Accounts” shall have the meaning set forth in Article 8 of the UCC.

“Security Agents” shall mean the Revolving Facility Agent, the First Lien
Security Agent and each Second Lien Security Agent.

 

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“Security Document” shall mean any Revolving Facility Security Document, any
First Lien Security Document or any Second Lien Security Document.

“Stock Rights” means all dividends, instruments or other distributions and any
other right or property which any Grantor shall receive or shall become entitled
to receive for any reason whatsoever with respect to, in substitution for or in
exchange for any Capital Stock constituting Collateral, any right to receive any
Capital Stock constituting Collateral and any right to receive earnings, in
which such Grantor now has or hereafter acquires any right, issued by an issuer
of such Capital Stock.

“Subsidiary” shall mean, with respect to any Person, any corporation,
partnership, limited liability company, association, joint venture or other
business entity of which more than 50.0% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the occurrence of
any contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of such Person or a combination
thereof; provided, that in determining the percentage of ownership interests of
any Person controlled by another Person, no ownership interest in the nature of
a “qualifying share” of the former Person shall be deemed to be outstanding.

“Supporting Obligations” shall have the meaning set forth in Article 9 of the
UCC.

“Tangible Chattel Paper” shall mean “tangible chattel paper” as such term is
defined in Article 9 of the UCC.

“Term Loan Obligations” shall mean, collectively, the First Lien Obligations and
the Second Lien Obligations.

“Term Proceeds Account” shall mean one or more Deposit Accounts or Securities
Accounts established by, or maintained with, the First Lien Security Agent into
which there may be deposited Proceeds of sales or dispositions of Notes Priority
Collateral (solely to the extent such Proceeds constitute Notes Priority
Collateral).

“Third Priority” shall mean, if any Additional Second Lien Obligations have been
issued:

(i) with respect to any Lien purported to be created on any Notes Priority
Collateral pursuant to any Revolving Facility Security Document, that such Lien
is prior in right to any other Lien thereon, other than (w) Liens under the
First Lien Security Documents, (x) Liens of the type permitted pursuant to
Section 6.02(l) of the Revolving Facility Credit Agreement (as in effect on the
date hereof), (y) First Lien Permitted Liens of the type permitted to be prior
to or pari passu with the Liens on the Notes Priority Collateral in accordance
with clause (ii) of the definition “First Priority” contained herein and
(z) Liens of the type permitted to be prior to the Liens on the Notes Priority
Collateral in accordance with clause (i) of the definition of “Secured Priority”
contained herein; and

 

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(ii) with respect to any Lien purported to be created on any Revolving Facility
Priority Collateral pursuant to any Second Lien Security Document, that such
Lien is prior in right to any other Lien thereon, other than (w) Liens under the
Revolving Facility Security Documents, (x) Liens of the type permitted pursuant
to Section 6.02(t) of the First Lien Credit Agreement (as in effect on the date
hereof), (y) Revolving Facility Permitted Liens of the type permitted to be
prior to the Liens on the Revolving Facility Priority Collateral in accordance
with clause (i) of the definition “First Priority” contained herein and
(z) First Lien Permitted Liens of the type permitted to be prior to the Liens on
the Notes Priority Collateral in accordance with clause (ii) of the definition
“First Priority” contained herein.

“Trade Secrets” shall mean any (a) trade secrets, including unpatented
inventions, invention disclosures, engineering or other data, production
procedures, know-how, processes, schematics, algorithms, techniques, analyses,
source code, and data collections; (b) all income, royalties, damages, and
payments now or hereafter due or payable with respect thereto, including
damages, claims and payments for past and future infringements thereof; (c) all
rights to sue for past, present and future infringements of the foregoing,
including the right to settle suits involving claims and demands for royalties
owing; and (d) all domestic rights corresponding to any of the foregoing.

“Trademarks” means, with respect to any Grantor, all of such Grantor’s right,
title, and interest in and to the following: (a) all trademarks (including
service marks), trade names, trade dress, and logos, slogans and other indicia
of origin and the registrations and applications for registration thereof and
the goodwill of the business symbolized by the foregoing; (b) all renewals of
the foregoing; (c) all income, royalties, damages, and payments now or hereafter
due or payable with respect thereto, including damages, claims, and payments for
past and future infringements thereof; (d) all rights to sue for past, present,
and future infringements of the foregoing, including the right to settle suits
involving claims and demands for royalties owing; and (e) all domestic rights
corresponding to any of the foregoing.

“UCC” shall mean the Uniform Commercial Code as in effect from time to time in
the State of New York.

“U.S.” means the United States of America.

1.2. Terms Generally; Timing of Performance; Miscellaneous. The definitions of
terms herein shall apply equally to the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation.” The word “will” shall be construed to have the same meaning and
effect as the word “shall”. Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, restated, amended and restated, supplemented,
renewed, extended, refunded, replaced or Refinanced or otherwise modified to the
extent not prohibited hereby, (b) any reference herein to any Person shall be
construed to include such Person’s successors and permitted assigns, (c) the
words “herein”, “hereof” and “hereunder”, and words of similar import, shall be
construed to refer to

 

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this Agreement in its entirety and not to any particular provision of this
Agreement, (d) all references herein to Exhibits, Sections, clauses or
paragraphs shall be construed to refer to Exhibits, Sections, clauses or
paragraphs of this Agreement, (e) the words “asset” and “property” shall be
construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights, (f) terms defined in the UCC but not otherwise
defined herein shall have the same meanings herein as are assigned thereto in
the UCC, (g) reference to any law means such law as amended, modified, codified,
replaced or re-enacted, in whole or in part, and in effect on the date hereof,
including rules, regulations, enforcement procedures and any interpretations
promulgated thereunder, and (h) references to Sections or clauses shall refer to
those portions of this Agreement, and any references to a clause shall, unless
otherwise identified, refer to the appropriate clause within the same Section in
which such reference occurs. When performance of any obligation is stated to be
due or performance is required on a day which is not a Business Day, the date of
such performance shall extend to the immediately succeeding Business Day.

 

Section 2. Lien Priorities.

(a) Lien Priorities.

(i) Relative Priorities. Notwithstanding (i) the time, manner, order or method
of grant, creation, attachment or perfection of any Liens securing the Revolving
Facility Obligations granted on the Collateral or of any Liens securing either
the First Lien Obligations or Second Lien Obligations granted on the Collateral,
(ii) the validity or enforceability of the security interests and Liens granted
in favor of any Security Agent or any Secured Party on the Collateral, (iii) the
date on which any Revolving Facility Obligations, First Lien Obligations or
Second Lien Obligations are extended, (iv) any provision of the UCC or any other
applicable law, including any rule for determining priority thereunder or under
any other law or rule governing the relative priorities of secured creditors,
including with respect to real property or fixtures, (v) any provision set forth
in any Revolving Facility Document, any First Lien Document or any Second Lien
Document (in each case, other than this Agreement), (vi) the possession or
control by any Security Agent or any Secured Party or any bailee of all or any
part of any Collateral as of the date hereof or otherwise, (vii) any failure by
any Security Agent or Secured Party to perfect its security interests in the
Collateral or (viii) any other circumstance whatsoever, each Security Agent, on
behalf of itself and its respective Secured Parties, hereby agrees that:

(A) any Lien on the Notes Priority Collateral securing any First Lien
Obligations or, if any Additional Second Lien Obligations have been issued, any
Second Lien Obligations, as the case may be, now or hereafter held by or on
behalf of the First Lien Security Agent or any other First Lien Secured Parties
or any agent or trustee therefor, or by or on behalf of the Second Lien Security
Agent or any other Second Lien Secured Parties or any agent or trustee therefor,
in each case, regardless of how acquired, whether by grant, possession, statute,
operation of law or court order, subrogation or otherwise, shall be senior in
all respects and prior to any Lien on the Notes Priority Collateral securing any
of the Revolving Facility Obligations;

 

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(B) any Lien on the Notes Priority Collateral securing any of the Revolving
Facility Obligations now or hereafter held by or on behalf of the Revolving
Facility Agent or any other Revolving Facility Secured Parties or any agent or
trustee therefor, regardless of how acquired, whether by grant, possession,
statute, operation of law or court order, subrogation or otherwise, shall be
junior and subordinate in all respects to all Liens on the Notes Priority
Collateral securing any First Lien Obligations and, if any Additional Second
Lien Obligations have been issued, any Second Lien Obligations.

(C) any Lien on the Revolving Facility Priority Collateral securing any
Revolving Facility Obligations now or hereafter held by or on behalf of the
Revolving Facility Agent or any other Revolving Facility Secured Parties or any
agent or trustee therefor, regardless of how acquired, whether by grant,
possession, statute, operation of law or court order, subrogation or otherwise,
in each case, shall be senior in all respects and prior to any Lien on the
Revolving Facility Priority Collateral securing any First Lien Obligations or,
if any Additional Second Lien Obligations have been issued, any Second Lien
Obligations;

(D) any Lien on the Revolving Facility Priority Collateral securing any First
Lien Obligations or, if any Additional Second Lien Obligations have been issued,
any Second Lien Obligations, now or hereafter held by or on behalf of the First
Lien Security Agent or any other First Lien Secured Parties or any agent or
trustee therefor, or by or on behalf of the Second Lien Security Agent or any
other Second Lien Secured Parties or any agent or trustee therefor, as the case
may be, regardless of how acquired, whether by grant, possession, statute,
operation of law or court order, subrogation or otherwise, in each case, shall
be junior and subordinate in all respects to all Liens on the Revolving Facility
Priority Collateral securing any Revolving Facility Obligations;

(E) if any Additional Second Lien Obligations have been issued, any Lien on the
Notes Priority Collateral or the Revolving Facility Priority Collateral securing
any First Lien Obligations now or hereafter held by or on behalf of the First
Lien Security Agent or any other First Lien Secured Parties or any agent or
trustee therefor, in each case, regardless of how acquired, whether by grant,
possession, statute, operation of law or court order, subrogation or otherwise,
shall be senior in all respects and prior to any Lien on the Notes Priority
Collateral or the Revolving Facility Priority Collateral, as the case may be,
securing any of the Second Lien Obligations; and

(F) if any Additional Second Lien Obligations have been issued, any Lien on the
Notes Priority Collateral or the Revolving Facility Priority Collateral, as the
case may be, securing any Second Lien Obligations now or hereafter held by or on
behalf of the Second Lien Security Agent or any other Second Lien Secured
Parties or any agent or trustee therefor, in each case, regardless of how
acquired, whether by grant, possession, statute, operation of law or court
order, subrogation or otherwise, shall be junior and subordinate in all respects
to all Liens on the Notes Priority Collateral or the Revolving Facility Priority
Collateral, as the case may be, securing any First Lien Obligations.

 

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(ii) Subordination. The priority and subordination provisions set forth in
clauses (A) through (F) above with respect to Liens on Collateral securing all
or any portion of the Revolving Facility Obligations, the First Lien Obligations
or the Second Lien Obligations, are intended to be effective whether or not such
Liens are subordinated to any Lien securing any other obligation of the Company,
any other Grantor or any other Person (but only to the extent that such
subordination is permitted pursuant to the terms of the Revolving Facility
Credit Agreement, the First Lien Credit Agreement and any Additional Second Lien
Obligations Agreement, or as contemplated in Section 3.5 or Section 4.5). The
parties hereto acknowledge and agree that it is their intent that each of the
Revolving Facility Obligations (and the security therefor), the First Lien
Obligations (and the security therefor) and the Second Lien Obligations (and the
security therefor) constitute a separate and distinct class of obligations (and
separate and distinct claims) from each other.

(b) Prohibition on Contesting Liens. Each of the Revolving Facility Agent, for
itself and on behalf of each other Revolving Facility Secured Party, the First
Lien Security Agent, for itself and on behalf of each other First Lien Secured
Party and, if any Additional Second Lien Obligations have been issued, the
Second Lien Security Agent, for itself and on behalf of each other Second Lien
Secured Party agrees that it shall not (and hereby waives any right to) contest
or support any other Person in contesting, in any proceeding (including any
Insolvency or Liquidation Proceeding), (i) the priority, validity, extent,
perfection or enforceability of a Lien held by or on behalf of any of the First
Lien Secured Parties, the Second Lien Secured Parties or the Revolving Facility
Secured Parties in either the Notes Priority Collateral or the Revolving
Facility Priority Collateral, as the case may be, (ii) the validity or
enforceability of any Revolving Facility Security Document (or any Revolving
Facility Obligations thereunder), any First Lien Security Document (or any First
Lien Obligations thereunder) or any Second Lien Security Document (or any Second
Lien Obligations thereunder), or (iii) the relative rights and duties of the
holders of any of the Revolving Facility Obligations, the First Lien Obligations
and the Second Lien Obligations granted and/or established in this Agreement;
provided that nothing in this Agreement shall be construed to prevent or impair
the rights of any of the Security Agents or any other Secured Party to enforce
this Agreement, including the priority of the Liens on the Notes Priority
Collateral or the Revolving Facility Priority Collateral, as the case may be,
securing any of the First Lien Obligations, the Second Lien Obligations and the
Revolving Facility Obligations as provided in Section 2(a).

(c) No New Liens.

(i) First Lien Obligations. So long as the Discharge of First Lien Obligations
has not occurred, except as contemplated by Section 3.5(c)(i) and
Section 4.5(d)(i), each of the Secured Parties agrees that such Secured Party
shall not take, accept or permit to exist any additional Liens on any asset or
property of any Grantor to secure any Revolving Facility Obligation or, if any
Additional Second Lien Obligations have been issued, any Second Lien Obligation
unless the Company and the Grantors have granted or reasonably contemporaneously
grant (A) a First Priority Lien on such asset or property to secure the First
Lien Obligations if such asset or property constitutes Notes Priority Collateral
or (B) a Second Priority Lien (or, after the Discharge of Revolving

 

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Facility Obligations, a First Priority Lien) on such asset or property to secure
the First Lien Obligations if such asset or property constitutes Revolving
Facility Priority Collateral. To the extent that the provisions of clause (A) in
the immediately preceding sentence are not complied with for any reason, without
limiting any other rights and remedies available to the First Lien Security
Agent and/or the other First Lien Secured Parties, each of the Second Lien
Security Agent, on behalf of the Second Lien Secured Parties, and the Revolving
Facility Agent, on behalf of the Revolving Facility Secured Parties, agrees that
any amounts received by or distributed to any of them pursuant to or as a result
of Liens on the Notes Priority Collateral granted in contravention of such
clause (A) of this Section 2(c)(i) shall be subject to Section 3.3(a).

(ii) Second Lien Obligations. After the issuance of any Additional Second Lien
Obligations, and so long as the Discharge of Second Lien Obligations has not
occurred, except as contemplated by Section 3.5(c)(i) and Section 4.5(d)(i),
each of the Secured Parties agrees that such Secured Party shall not take,
accept or permit to exist any additional Liens on any asset or property of any
Grantor to secure any First Lien Obligations or any Revolving Facility
Obligations unless the Company and the Grantors have granted or reasonably
contemporaneously grant (A) a Second Priority Lien (or, after the Discharge of
First Lien Obligations has occurred, a First Priority Lien) on such asset or
property to secure the Second Lien Obligations if such asset or property
constitutes Notes Priority Collateral or (B) a Third Priority Lien (or, after
the Discharge of First Lien Obligations has occurred, a Second Priority Lien) on
such asset or property to secure the Second Lien Obligations if such asset or
property constitutes Revolving Facility Priority Collateral. To the extent that
the provisions of clause (A) in the immediately preceding sentence are not
complied with for any reason, without limiting any other rights and remedies
available to the Second Lien Security Agent and/or any other Second Lien Secured
Parties, the Revolving Facility Agent, on behalf of the Revolving Facility
Secured Parties, agrees that any amounts received by or distributed to any of
them pursuant to or as a result of Liens on the Notes Priority Collateral
granted in contravention of such clause (A) of this Section 2(c)(ii) shall be
subject to Section 3.3(b).

(iii) Revolving Facility Obligations. So long as the Discharge of Revolving
Facility Obligations has not occurred, except as contemplated by
Section 3.5(c)(i) and Section 4.5(d), each of the Secured Parties agrees that
such Secured Party shall not take, accept or permit to exist any additional
Liens on any asset or property of any Grantor to secure any First Lien
Obligations or any Second Lien Obligations unless the Company and the Grantors
granted or reasonably contemporaneously grant (A) a First Priority Lien on such
asset or property to secure the Revolving Facility Obligations if such asset or
property constitutes Revolving Facility Priority Collateral or (B) (x) if any
Additional Second Lien Obligations have been issued, a Third Priority Lien (or,
after the Discharge of First Lien Obligations has occurred, a Second Priority
Lien) or (y) if any Additional Second Lien Obligations have not been issued, a
Second Priority Lien, on such asset or property to secure the Revolving Facility
Obligations if such asset or property constitutes Notes Priority Collateral. To
the extent that the provisions of clause (A) in the immediately preceding
sentence are not complied with for any reason, without limiting any other rights
and remedies available to the Revolving Facility Agent and/or the other
Revolving Facility Secured Parties, the First Lien Security Agent, on behalf of
the First Lien Secured Parties, and the Second Lien Security Agent, on behalf of
the Second Lien Secured Parties, agree that any amounts received by or
distributed to any of them pursuant to or as a result of Liens on the Revolving
Facility Priority Collateral granted in contravention of such clause (A) of this
Section 2(c)(iii) shall be subject to Section 4.3.

 

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(d) Effectiveness of Lien Priorities. Each of the parties hereto acknowledges
that the Lien priorities provided for in this Agreement shall not be affected or
impaired in any manner whatsoever, including on account of: (i) the invalidity,
irregularity or unenforceability of all or any part of the Revolving Facility
Documents, the First Lien Documents or the Second Lien Documents; (ii) any
amendment, change or modification of any Revolving Facility Documents, the First
Lien Documents or the Second Lien Documents; or (iii) any impairment,
modification, change, exchange, release or subordination of or limitation on,
any liability of, or stay of actions or Lien enforcement proceedings against,
any Grantor under any of the Revolving Facility Documents, the First Lien
Documents or the Second Lien Documents, any property of any Grantor, or any
Grantor’s estate in bankruptcy resulting from any bankruptcy, arrangement,
readjustment, composition, liquidation, rehabilitation, similar proceeding or
otherwise involving or affecting any Secured Party.

(e) Similar Liens and Agreements. The parties hereto agree that it is their
intention that the assets and property of the Grantors constituting Collateral
securing each of the Revolving Facility Obligations, the First Lien Obligations
and the Second Lien Obligations be substantially the same, subject to
differences between the Revolving Facility Security Documents and the First Lien
Security Documents (each as in effect on the date hereof). In furtherance of the
foregoing and of Section 8.7, each Security Agent and each other Secured Party
agrees, subject to the other provisions of this Agreement:

(i) upon reasonable request by any Directing Security Agent, to cooperate in
good faith from time to time in order to determine the specific items included
in the Collateral securing the Revolving Facility Obligations, the First Lien
Obligations or the Second Lien Obligations, as the case may be, and the steps
taken to perfect the Liens thereon and the identity of the respective parties
obligated under the Revolving Facility Documents, the First Lien Documents or
the Second Lien Documents, as the case may be;

(ii) that the First Lien Security Documents, the Second Lien Security Documents
and the Revolving Facility Security Documents creating Liens on the Notes
Priority Collateral and the Revolving Facility Priority Collateral shall be in
all material respects substantially the same forms of documents other than with
respect to the First Priority, Second Priority and Third Priority nature of the
Liens created thereunder in such Collateral and the Revolving Facility
Obligations constituting an asset-based loan (it being understood that the First
Lien Security Documents and Revolving Facility Security Documents in effect on
the date hereof (including any forms or exhibits attached to any of the
foregoing or any other First Lien Document or Revolving Facility Document)
satisfy this provision as of the date hereof); and

(iii) the guaranties executed and delivered by the Grantors in respect of the
Revolving Facility Obligations, the First Lien Obligations and the Second Lien
Obligations shall be substantially in the same form (it being understood that
the guaranties included in each of the Revolving Facility Credit Agreement and
the First Lien Credit Agreement (each as in effect on the date hereof) satisfy
this provision as of the date hereof).

 

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Section 3. Notes Priority Collateral.

3.1. Exercise of Remedies – Prior to Discharge of First Lien Obligations.

(a) So long as the Discharge of First Lien Obligations has not occurred, whether
or not any Insolvency or Liquidation Proceeding has been commenced by or against
the Company or any other Grantor:

(i) none of the Revolving Facility Agent, any of the other Revolving Facility
Secured Parties or, if any Additional Second Lien Obligations have been issued,
the Second Lien Security Agent or any of the other Second Lien Secured Parties
(x) will exercise or seek to exercise any rights or remedies (including setoff)
with respect to any Notes Priority Collateral (including the exercise of any
right under any lockbox agreement, account control agreement, landlord waiver or
bailee’s letter or similar agreement or arrangement in respect of any Term
Proceeds Account to which the Revolving Facility Agent, any other Revolving
Facility Secured Party, the Second Lien Security Agent or any other Second Lien
Secured Party is a party) or institute or commence, or join with any Person
(other than the First Lien Security Agent and the other First Lien Secured
Parties) in commencing any action or proceeding with respect to such rights or
remedies (including any action of foreclosure, enforcement, collection or
execution); provided, however, that (A) the Revolving Facility Agent may
exercise any or all such rights in accordance with the Revolving Facility
Documents after the passage of a period of 180 days has elapsed since the date
of delivery of a notice in writing to the Directing First Lien Security Agent
with respect to any of the following (and requesting that enforcement actions be
taken with respect to the Notes Priority Collateral) and so long as the
respective payment default shall not have been cured or waived (or the
respective acceleration rescinded): (i) a payment default exists with respect to
the Revolving Facility Obligations following the final maturity of the Revolving
Facility Obligations or (ii) after the acceleration by the relevant Revolving
Facility Secured Parties of the maturity of all then outstanding Revolving
Facility Obligations (the “Revolving Facility Standstill Period”); and (B) if
any Additional Second Lien Obligations have been issued, the Directing Second
Lien Security Agent may exercise any or all such rights in accordance with the
Second Lien Documents after the passage of a period of 180 days has elapsed
since the date of delivery of a notice in writing to the Directing First Lien
Security Agent with respect to any of the following (and requesting that
enforcement actions be taken with respect to the Notes Priority Collateral) and
so long as the respective payment default shall not have been cured or waived
(or the respective acceleration rescinded): (i) a payment default exists with
respect to the Second Lien Obligations following the final maturity of the
Second Lien Obligations or (ii) after the acceleration by the relevant Second
Lien Secured Parties of the maturity of all then outstanding Second Lien
Obligations (the “Second Lien Standstill Period”); provided, further, however,
notwithstanding anything herein to the contrary, none of the Revolving Facility
Agent or any other Revolving Facility Secured Party, or, if any Additional
Second Lien Obligations have been issued, the Second Lien Security Agent or any
other Second Lien Secured Party will exercise any rights or remedies with
respect to any Notes Priority Collateral if, notwithstanding the expiration of
the Revolving Facility Standstill Period and/or the Second Lien Standstill
Period, as the case may be, the Directing First Lien Security Agent or First
Lien Secured Parties shall have commenced and be diligently pursuing in good
faith the exercise of any of their rights or remedies with respect to the Notes
Priority Collateral (prompt notice of such exercise to be given by the Directing
First Lien Security Agent to the Revolving Facility Agent and the Directing
Second Lien Security Agent), (y) subject to Section 6, will contest, protest or
object to any foreclosure proceeding or action brought by the Directing First
Lien Security Agent or any other First Lien Secured Party with respect to, or
any other exercise by the Directing First Lien

 

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Security Agent or any other First Lien Secured Party of any rights and remedies
relating to, the Notes Priority Collateral under the First Lien Documents or
otherwise, and (z) subject to its rights under clause (i)(x) above, will object
to the forbearance by the Directing First Lien Security Agent or the other First
Lien Secured Parties from bringing or pursuing any foreclosure proceeding or
action or any other exercise of any rights or remedies relating to the Notes
Priority Collateral, in each case so long as the respective interests of the
Revolving Facility Secured Parties and, if any Additional Second Lien
Obligations have been issued, the Second Lien Secured Parties attach to the
Proceeds thereof subject to the relative priorities described in Section 2;
provided, however, that nothing in this Section 3.1(a) shall be construed to
authorize the Revolving Facility Agent, any other Revolving Facility Secured
Party, the Second Lien Security Agent or any other Second Lien Secured Party to
sell any Notes Priority Collateral free of the Lien of the First Lien Security
Agent or any other First Lien Secured Party; and

(ii) subject to Section 6 and clause (i)(x) above, the Directing First Lien
Security Agent and the other First Lien Secured Parties shall have the exclusive
right to enforce rights, exercise remedies (including set off and applicable
credit bid rights) and make determinations regarding the disposition of, or
restrictions with respect to, the Notes Priority Collateral without any
consultation with or the consent of the Revolving Facility Agent or any other
Revolving Facility Secured Party, or, if any Additional Second Lien Obligations
have been issued, the Second Lien Security Agent or any other Second Lien
Secured Party; provided, that:

(A) in any Insolvency or Liquidation Proceeding commenced by or against the
Company or any other Grantor, the Revolving Facility Agent, any Revolving
Facility Secured Party, the Second Lien Security Agent or any Second Lien
Secured Party may file a claim or statement of interest with respect to the
Revolving Facility Obligations or Second Lien Obligations, as applicable;

(B) the Revolving Facility Agent, any other Revolving Facility Secured Party,
the Second Lien Security Agent and any other Second Lien Secured Party may take
any action (not adverse to the priority status of the Liens on the Notes
Priority Collateral securing the First Lien Obligations, or the rights of any
First Lien Security Agent or the other First Lien Secured Parties to exercise
remedies in respect thereof) in accordance with the Revolving Facility Documents
or the Second Lien Documents, as applicable, and the terms of this Agreement in
order to preserve or protect its Lien on the Notes Priority Collateral;

(C) the Revolving Facility Secured Parties and the Second Lien Secured Parties
shall be entitled to file any necessary responsive or defensive pleadings in
opposition to any motion, claim, adversary proceeding or other pleading made by
any Person objecting to or otherwise seeking the disallowance of the claims of
the Revolving Facility Secured Parties or the Second Lien Secured Parties,
including any claims secured by the Notes Priority Collateral, if any, in each
case in accordance with the terms of this Agreement;

 

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(D) the Revolving Facility Secured Parties and the Second Lien Secured Parties
shall be entitled to file any pleadings, objections, motions or agreements which
assert rights or interests available to unsecured creditors of the Grantors
arising under either Debtor Relief Laws or applicable non-bankruptcy law, in
each case in accordance with the terms of this Agreement (including, with
respect to the Second Lien Secured Parties, under Section 4.2(a)(i)) and to the
extent not prohibited by any other provision of this Agreement;

(E) the Revolving Facility Secured Parties and the Second Lien Secured Parties
shall be entitled to vote on any plan of reorganization and file any proof of
claim in an Insolvency or Liquidation Proceeding or otherwise and other filings
and make any arguments and motions that are, in each case, in accordance with
the terms of this Agreement (including, with respect to the Second Lien Secured
Parties, under Section 4.2(a)(i)), with respect to the Notes Priority
Collateral;

(F) the Revolving Facility Agent or any Revolving Facility Secured Party may
exercise any of its rights or remedies with respect to the Notes Priority
Collateral in accordance with the Revolving Facility Documents after the
termination of the Revolving Facility Standstill Period to the extent permitted
by clause (i)(x) above; and

(G) the Second Lien Security Agent or any Second Lien Secured Party may exercise
any of its rights or remedies with respect to the Notes Priority Collateral in
accordance with the Second Lien Documents after the termination of the Second
Lien Standstill Period to the extent permitted by clause (i)(x) above.

Subject to Section 6 and clause (i)(x) above, in exercising rights and remedies
with respect to the Notes Priority Collateral, the Directing First Lien Security
Agent and the other First Lien Secured Parties may enforce the provisions of the
First Lien Documents and exercise remedies thereunder, all in such order and in
such manner as they may determine in the exercise of their sole discretion. Such
exercise and enforcement shall include the rights of an agent appointed by them
to sell or otherwise dispose of Notes Priority Collateral upon foreclosure, to
incur expenses in connection with such sale or disposition, and to exercise all
the rights and remedies of a secured creditor under the UCC of any applicable
jurisdiction and of a secured creditor under any other applicable law.

(b) Each of the Revolving Facility Agent, on behalf of itself and the other
Revolving Facility Secured Parties, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent, on behalf of
itself and the other Second Lien Secured Parties, agrees that it will not take
or receive any Notes Priority Collateral or any Proceeds of Notes Priority
Collateral in connection with the exercise of any right or remedy (including
setoff) with respect to any Notes Priority Collateral unless and until the
Discharge of First Lien Obligations has occurred, except as expressly provided
in the first proviso in clause (i)(x) of Section 3.1(a) or in the proviso in
clause (ii) of Section 3.1(a) or in Section 6. Without limiting the generality
of the foregoing, unless and until the Discharge of First Lien Obligations has
occurred, except as expressly provided in the first proviso in clause (i)(x) of
Section 3.1(a) or in the proviso in clause (ii) of Section 3.1(a) (but subject
to the payment over requirements of Section 3.3) or in Section 6, the sole right
of the Revolving Facility Agent and the other

 

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Revolving Facility Secured Parties and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent and the other
Second Lien Secured Parties, as the case may be, with respect to the Notes
Priority Collateral is to hold a Lien on the Notes Priority Collateral pursuant
to the Revolving Facility Documents or the Second Lien Documents, as the case
may be, for the period and to the extent granted therein and to receive a share
of the Proceeds thereof, if any, after the Discharge of First Lien Obligations
has occurred in accordance with the terms hereof, the First Lien Documents and
applicable law.

(c) Subject to the first proviso in clause (i)(x) of Section 3.1(a), the proviso
in clause (ii) of Section 3.1(a) and Section 6:

(i) each of the Revolving Facility Agent, for itself and on behalf of the other
Revolving Facility Secured Parties, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent, for itself and on
behalf of the other Second Lien Secured Parties, agrees that it will not take
any action that would hinder, delay, limit or prohibit any exercise of remedies
under the First Lien Documents with respect to the Notes Priority Collateral,
including any collection, sale, lease, exchange, transfer or other disposition
of the Notes Priority Collateral, whether by foreclosure or otherwise, or that
would limit, invalidate, avoid or set aside any Lien or First Lien Security
Document, with respect to the Notes Priority Collateral or subordinate the
priority of the First Lien Obligations to either the Revolving Facility
Obligations or the Second Lien Obligations, as the case may be, with respect to
the Notes Priority Collateral or grant the Liens with respect to the Notes
Priority Collateral securing the Revolving Facility Obligations or the Second
Lien Obligations equal ranking to the Liens with respect to the Notes Priority
Collateral securing the First Lien Obligations, and

(ii) each of the Revolving Facility Agent, for itself and on behalf of the other
Revolving Facility Secured Parties, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent, for itself and on
behalf of the other Second Lien Secured Parties, hereby waives any and all
rights it or the other Revolving Facility Secured Parties or the other Second
Lien Secured Parties, as the case may be, may have as a junior Lien creditor
with respect to the Notes Priority Collateral or otherwise to object to the
manner in which the First Lien Security Agent or the other First Lien Secured
Parties seek to enforce or collect the First Lien Obligations or the Liens
granted in any of the Notes Priority Collateral, in any such case except to the
extent such enforcement or collection is in violation of the terms of this
Agreement, regardless of whether any action or failure to act by or on behalf of
the First Lien Security Agent or First Lien Secured Parties is adverse to the
interest of the Revolving Facility Secured Parties or the Second Lien Secured
Parties, as the case may be.

(d) Each of the Revolving Facility Agent, for itself and on behalf of the other
Revolving Facility Secured Parties, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent, for itself and on
behalf of the other Second Lien Secured Parties, hereby acknowledges and agrees
that no covenant, agreement or restriction contained in any Revolving Facility
Document or Second Lien Document, as applicable (other than this Agreement),
shall be deemed to restrict in any way the rights and remedies of the First Lien
Security Agent or the First Lien Secured Parties with respect to the Notes
Priority Collateral as set forth in this Agreement and the First Lien Documents.

 

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3.2. Exercise of Remedies – After Discharge of First Lien Obligations.

(a) After the Discharge of First Lien Obligations has occurred and, if any
Additional Second Lien Obligations have been issued, so long as the Discharge of
Second Lien Obligations has not occurred, whether or not any Insolvency or
Liquidation Proceeding has been commenced by or against the Company or any other
Grantor:

(i) neither the Revolving Facility Agent nor any of the other Revolving Facility
Secured Parties (x) will exercise or seek to exercise any rights or remedies
(including setoff) with respect to any Notes Priority Collateral (including the
exercise of any right under any lockbox agreement, account control agreement,
landlord waiver or bailee’s letter or similar agreement or arrangement in
respect of any Term Proceeds Account to which the Revolving Facility Agent or
any other Revolving Facility Secured Party is a party) or institute or commence,
or join with any Person (other than the Second Lien Security Agent and the other
Second Lien Secured Parties) in commencing any action or proceeding with respect
to such rights or remedies (including any action of foreclosure, enforcement,
collection or execution); provided, however, that the Revolving Facility Agent
may exercise any or all such rights in accordance with the Revolving Facility
Documents after the passage of a period of 180 days has elapsed since the date
of delivery of a notice in writing to the Directing Second Lien Security Agent
with respect to any of the following (and requesting that enforcement actions be
taken with respect to the Notes Priority Collateral) and so long as the
respective payment default shall not have been cured or waived (or the
respective acceleration rescinded): (i) a payment default exists with respect to
the Revolving Facility Obligations following the final maturity of the Revolving
Facility Obligations or (ii) after the acceleration by the relevant Revolving
Facility Secured Parties of the maturity of all then outstanding Revolving
Facility Obligations (the “Revolving Facility/Second Lien Standstill Period”);
provided, further, however, notwithstanding anything herein to the contrary,
neither the Revolving Facility Agent nor any other Revolving Facility Secured
Party will exercise any rights or remedies with respect to any Notes Priority
Collateral if, notwithstanding the expiration of the Revolving Facility/Second
Lien Standstill Period, the Directing Second Lien Security Agent or any other
Second Lien Secured Party shall have commenced and be diligently pursuing in
good faith the exercise of any of their rights or remedies with respect to the
Notes Priority Collateral (prompt notice of such exercise to be given by the
Directing Second Lien Security Agent to the Revolving Facility Agent),
(y) subject to Section 6, will contest, protest or object to any foreclosure
proceeding or action brought by the Directing Second Lien Security Agent or any
other Second Lien Secured Party with respect to, or any other exercise by the
Directing Second Lien Security Agent or any other Second Lien Secured Party of
any rights and remedies relating to, the Notes Priority Collateral under the
Second Lien Documents or otherwise, and (z) subject to its rights under the
first proviso in clause (i)(x) above, will object to the forbearance by the
Directing Second Lien Security Agent or any other Second Lien Secured Party from
bringing or pursuing any foreclosure proceeding or action or any other exercise
of any rights or remedies relating to the Notes Priority Collateral, in each
case so long as the respective interests of the Revolving Facility Secured
Parties attach to the Proceeds thereof subject to the relative priorities
described in Section 2(a); provided, however, that nothing in this Section 3.2
shall be construed to authorize the Revolving Facility Agent or any other
Revolving Facility Secured Party to sell or appropriate any Notes Priority
Collateral free of the Lien of the Second Lien Security Agent or any Second Lien
Secured Party; and

 

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(ii) except as may be permitted in accordance with Section 6 and clause (i)(x)
above, the Directing Second Lien Security Agent and the other Second Lien
Secured Parties shall have the exclusive right to enforce rights, exercise
remedies (including set off and credit bid rights) and make determinations
regarding the disposition of, or restrictions with respect to, the Notes
Priority Collateral without any consultation with or the consent of the
Revolving Facility Agent or any other Revolving Facility Secured Party;
provided, that:

(A) in any Insolvency or Liquidation Proceeding commenced by or against the
Company or any other Grantor, the Revolving Facility Agent and any other
Revolving Facility Secured Party may file a claim or statement of interest with
respect to the Revolving Facility Obligations;

(B) the Revolving Facility Agent and any other Revolving Facility Secured Party
may take any action (not adverse to the priority status of the Liens on the
Notes Priority Collateral securing the Second Lien Obligations, or the rights of
any Second Lien Security Agent or the other Second Lien Secured Parties to
exercise remedies in respect thereof) in accordance with the Revolving Facility
Documents and the terms of this Agreement in order to preserve or protect its
Liens on or over the Notes Priority Collateral;

(C) the Revolving Facility Secured Parties shall be entitled to file any
necessary responsive or defensive pleadings in opposition to any motion, claim,
adversary proceeding or other pleading made by any Person objecting to or
otherwise seeking the disallowance of the claims of the Revolving Facility
Secured Parties, including any claims secured by the Notes Priority Collateral,
if any, in each case in accordance with the terms of this Agreement;

(D) the Revolving Facility Secured Parties shall be entitled to file any
pleadings, objections, motions or agreements which assert rights or interests
available to unsecured creditors of the Grantors arising under either Debtor
Relief Laws or applicable non-bankruptcy law, in each case in accordance with
the terms of this Agreement (including under Section 3.2(a)(i)) and to the
extent not prohibited by any other provision of this Agreement;

(E) the Revolving Facility Secured Parties shall be entitled to vote on any plan
of reorganization and file any proof of claim in an Insolvency or Liquidation
Proceeding or otherwise and other filings and make any arguments and motions
that are, in each case, in accordance with the terms of this Agreement
(including under Section 3.2(a)(i)), with respect to the Notes Priority
Collateral; and

(F) the Revolving Facility Agent or any Revolving Facility Secured Party may
exercise any of its rights or remedies with respect to the Notes Priority
Collateral in accordance with the Revolving Facility Documents after the
termination of the Revolving Facility/Second Lien Standstill Period to the
extent permitted by clause (i)(x) above.

 

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Except as may be permitted in accordance with Section 6 and clause (i)(x) above,
in exercising rights and remedies with respect to the Notes Priority Collateral
following the Discharge of First Lien Obligations, the Directing Second Lien
Security Agent and the other Second Lien Secured Parties may enforce the
provisions of the Second Lien Documents and exercise remedies thereunder, all in
such order and in such manner as they may determine in the exercise of their
sole discretion subject to applicable law and the terms of the Second Lien
Documents, including the rights of an agent appointed by them to sell or
otherwise dispose of Notes Priority Collateral upon foreclosure, to incur
expenses in connection with such sale or disposition, and to exercise all the
rights and remedies of a secured creditor under the UCC of any applicable
jurisdiction and of a secured creditor under any other applicable law.

(b) After the Discharge of First Lien Obligations has occurred and, if any
Additional Second Lien Obligations have been issued, so long as the Discharge of
Second Lien Obligations has not occurred, the Revolving Facility Agent, on
behalf of itself and the other Revolving Facility Secured Parties, agrees that
it will not take or receive any Notes Priority Collateral or any Proceeds of
Notes Priority Collateral in connection with the exercise of any right or remedy
(including setoff) with respect to any Notes Priority Collateral, except as
expressly provided in the first proviso in clause (i)(x) of Section 3.2(a) or in
the proviso in clause (ii) of Section 3.2(a) (subject to the payment over
requirements of Section 3.3) or in Section 6. Without limiting the generality of
the foregoing, if any Additional Second Lien Obligations have been issued,
unless and until the Discharge of Second Lien Obligations has occurred, except
as expressly provided in the first proviso in clause (i)(x) of Section 3.2(a) or
in the proviso in clause (ii) of Section 3.2(a) or in Section 6, the sole right
of the Revolving Facility Agent and the other Revolving Facility Secured Parties
with respect to the Notes Priority Collateral is to hold a Lien on the Notes
Priority Collateral pursuant to the Revolving Facility Documents for the period
and to the extent granted therein and to receive a share of the Proceeds
thereof, if any, after the Discharge of Second Lien Obligations has occurred in
accordance with the terms hereof, the Second Lien Documents and applicable law.

(c) After the Discharge of First Lien Obligations has occurred and, if any
Additional Second Lien Obligations have been issued, so long as the Discharge of
Second Lien Obligations has not occurred, subject to the first proviso in clause
(i)(x) of Section 3.2(a), the proviso in clause (ii) of Section 3.2(a) and
Section 6:

(i) the Revolving Facility Agent, for itself and on behalf of the other
Revolving Facility Secured Parties, agrees that the Revolving Facility Agent and
the Revolving Facility Secured Parties will not take any action that would
hinder delay, limit or prohibit any exercise of remedies under the Second Lien
Documents with respect to the Notes Priority Collateral, including any
collection, sale, lease, exchange, transfer or other disposition of the Notes
Priority Collateral, whether by foreclosure or otherwise, or that would limit,
invalidate, avoid or set aside any Lien or Second Lien Security Document with
respect to the Notes Priority Collateral or subordinate the priority of the
Second Lien Obligations to the Revolving Facility Obligations with respect to
the Notes Priority Collateral or grant the Liens with respect to the Notes
Priority Collateral securing the Revolving Facility Obligations equal ranking to
the Liens with respect to the Notes Priority Collateral securing the Second Lien
Obligations, and

 

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(ii) the Revolving Facility Agent, for itself and on behalf of the other
Revolving Facility Secured Parties, hereby waives any and all rights it or the
other Revolving Facility Secured Parties may have as a junior Lien creditor with
respect to the Notes Priority Collateral or otherwise to object to the manner in
which the Second Lien Security Agent or the other Second Lien Secured Parties
seek to enforce or collect the Second Lien Obligations or the Liens granted in
any of the Notes Priority Collateral, in any such case except to the extent such
enforcement or collection is in violation of the terms of this Agreement,
regardless of whether any action or failure to act by or on behalf of the other
Second Lien Security Agent or Second Lien Secured Parties is adverse to the
interest of the Revolving Facility Secured Parties.

(d) The Revolving Facility Agent hereby acknowledges and agrees that, if any
Additional Second Lien Obligations have been issued, no covenant, agreement or
restriction contained in any Revolving Facility Document (other than this
Agreement) shall be deemed to restrict in any way the rights and remedies of the
Second Lien Security Agent or the Second Lien Secured Parties with respect to
the Notes Priority Collateral as set forth in this Agreement and the Second Lien
Documents.

3.3. Payments Over.

(a) Prior to Discharge of First Lien Obligations. So long as the Discharge of
First Lien Obligations has not occurred, any Notes Priority Collateral and
Proceeds thereof received by (i) if any Additional Second Lien Obligations have
been issued, the Second Lien Security Agent or any Second Lien Secured Parties,
(ii) the Revolving Facility Agent or any Revolving Facility Secured Parties or
(iii) any other First Lien Security Agent or any other First Lien Secured Party,
in each case, in connection with the exercise of any right or remedy (including
set off) relating to the Notes Priority Collateral (including following the
expiration of the Second Lien Standstill Period or the Revolving Facility
Standstill Period) or otherwise that is inconsistent with this Agreement shall
be segregated and held in trust and forthwith paid over to the Directing First
Lien Security Agent, for the benefit of the First Lien Secured Parties, for
application in accordance with Section 7.1 below, in the same form as received,
with any necessary endorsements or as a court of competent jurisdiction may
otherwise direct. The Directing First Lien Security Agent is hereby authorized
to make any such endorsements as agent for the Revolving Facility Agent, any
such Revolving Facility Secured Parties, the Second Lien Security Agent, any
such Second Lien Secured Parties and the other First Lien Security Agents or any
such First Lien Secured Parties. This authorization is coupled with an interest
and is irrevocable until the Discharge of First Lien Obligations.

(b) After Discharge of First Lien Obligations. After the Discharge of First Lien
Obligations has occurred and, if any Additional Second Lien Obligations have
been issued, so long as the Discharge of Second Lien Obligations has not
occurred, any Notes Priority Collateral, Cash Proceeds thereof or non-Cash
Proceeds constituting Notes Priority Collateral (or any distribution in respect
of the Notes Priority Collateral, whether or not expressly characterized as
such) received by (i) the Revolving Facility Agent or any Revolving Facility
Secured Parties

 

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or (ii) any Second Lien Security Agent or any other Second Lien Secured Party in
connection with the exercise of any right or remedy (including set off) relating
to the Notes Priority Collateral or otherwise that is inconsistent with the
terms of this Agreement shall be segregated and held in trust and forthwith paid
over to the Directing Second Lien Security Agent, for the benefit of the Second
Lien Secured Parties, for application in accordance with Section 7.3 below, in
the same form as received, with any necessary endorsements or as a court of
competent jurisdiction may otherwise direct. The Directing Second Lien Security
Agent is hereby authorized to make any such endorsements as agent for the
Revolving Facility Agent, any such Revolving Facility Secured Parties, the other
Second Lien Security Agents and the other Second Lien Secured Parties. This
authorization is coupled with an interest and is irrevocable until the Discharge
of Second Lien Obligations.

3.4. Other Agreements.

(a) Releases – First Lien Obligations.

(i) If, in connection with:

(A) the exercise of any Directing First Lien Security Agent’s remedies in
respect of the Notes Priority Collateral provided for in Section 3.1(a) (with
the Proceeds thereof being applied to the First Lien Priority Obligations),
including any sale, lease, exchange, transfer or other disposition of any such
Notes Priority Collateral; or

(B) any sale, lease, exchange, transfer or other disposition of any Notes
Priority Collateral permitted under the terms of the First Lien Documents (other
than in connection with the Discharge of First Lien Obligations and subject to
this Agreement),

the Directing First Lien Security Agent, for itself or on behalf of any of the
other First Lien Secured Parties, releases any of its Liens on any part of the
Notes Priority Collateral, then the Liens, if any, of (x) the Revolving Facility
Agent, for itself or for the benefit of the other Revolving Facility Secured
Parties, and (y) if any Additional Second Lien Obligations have been issued, the
Second Lien Security Agent for itself or for the benefit of the other Second
Lien Secured Parties, on such Notes Priority Collateral (but not, in each case,
the Proceeds thereof (until applied to the First Lien Obligations), which shall
be subject to the priorities set forth in this Agreement) shall be
automatically, unconditionally and simultaneously released, and the Directing
First Lien Security Agent is irrevocably authorized to execute and deliver or
enter into any release of such Liens or claims that may, in the discretion of
the Directing First Lien Security Agent, be necessary or reasonably desirable in
connection with such releases, and (A) if any Additional Second Lien Obligations
have been issued, the Second Lien Security Agent, for itself and on behalf of
the other Second Lien Secured Parties, and (B) the Revolving Facility Agent, for
itself or on behalf of the other Revolving Facility Secured Parties, promptly
shall execute and deliver to the Directing First Lien Security Agent or such
Grantor (at the expense of such Grantor) such termination statements, releases
and other documents as the Directing First Lien Security Agent or such Grantor
may request to effectively confirm such release. Similarly, if the equity
interests of any Person are foreclosed upon or otherwise disposed of and in
connection therewith the Directing First Lien Security Agent releases the First
Liens on the property or assets of such Person or releases such Person from its
guarantee of First Lien Obligations, then, if any

 

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Additional Second Lien Obligations have been issued, the Second Liens on such
property or assets of such Person and such Person’s guarantee of Second Lien
Obligations shall be automatically released to the same extent.

(ii) Until the Discharge of First Lien Obligations occurs, each of (x) the
Revolving Facility Agent, for itself and on behalf of the other Revolving
Facility Secured Parties and (y) if any Additional Second Lien Obligations have
been issued, the Second Lien Security Agent, for itself and on behalf of the
other Second Lien Secured Parties, hereby irrevocably constitutes and appoints
the Directing First Lien Security Agent and any officer or agent of the
Directing First Lien Security Agent, with full power of substitution, as its
true and lawful attorney in fact with full irrevocable power and authority in
the place and stead of the Revolving Facility Agent, the Second Lien Security
Agent or such Secured Party, as the case may be, or in the Directing First Lien
Security Agent’s own name, from time to time in the Directing First Lien
Security Agent’s discretion, for the purpose of carrying out the terms of this
Section 3.4(a) with respect to Notes Priority Collateral, to take any and all
appropriate action and to execute any and all documents and instruments which
may be necessary to accomplish the purposes of this Section 3.4(a) with respect
to Notes Priority Collateral, including any endorsements or other instruments of
transfer or release.

(iii) Until the Discharge of First Lien Obligations occurs, to the extent that
the First Lien Secured Parties (a) have released any Lien on Notes Priority
Collateral and any such Lien is later reinstated or (b) obtain any new First
Priority Liens on assets constituting Notes Priority Collateral from Grantors,
then (A) if any Additional Second Lien Obligations have been issued, (x) the
Second Lien Secured Parties shall be granted a Second Priority Lien and (y) the
Revolving Facility Secured Parties shall be granted a Third Priority Lien (or,
after the Discharge of Second Lien Obligations, a Second Priority Lien), or
(B) so long as any Additional Second Lien Obligations have not been issued, the
Revolving Facility Secured Parties shall be granted a Second Priority Lien, in
each case on any such Notes Priority Collateral.

(b) Releases – Second Lien Obligations.

(i) After the Discharge of First Lien Obligations has occurred and, if any
Additional Second Lien Obligations have been issued, so long as the Discharge of
Second Lien Obligations has not occurred, if, in connection with:

(A) the exercise of any of the Second Lien Security Agent’s remedies in respect
of the Notes Priority Collateral provided for in Section 3.2(a) (with the
Proceeds thereof being applied to the Second Lien Priority Obligations),
including any sale, lease, exchange, transfer or other disposition of any such
Notes Priority Collateral; or

(B) any sale, lease, exchange, transfer or other disposition of any Notes
Priority Collateral permitted under the terms of the Second Lien Documents
(other than in connection with the Discharge of Second Lien Obligations and
subject to this Agreement),

 

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the Directing Second Lien Security Agent, on behalf of itself and the other
Second Lien Secured Parties, releases any of its Liens on any part of the Notes
Priority Collateral, then the Liens, if any, of the Revolving Facility Agent,
for itself and for the benefit of the other Revolving Facility Secured Parties,
on such Notes Priority Collateral (but not the Proceeds thereof (until applied
to the Second Lien Obligations), which shall be subject to the priorities set
forth in this Agreement), shall be automatically, unconditionally and
simultaneously released and the Directing Second Lien Security Agent is
irrevocably authorized to execute and deliver or enter into any release of such
Liens or claims that may, in the discretion of the Directing Second Lien
Security Agent, be considered necessary or reasonably desirable in connection
with such releases, and the Revolving Facility Agent, for itself and on behalf
of the other Revolving Facility Secured Parties, promptly shall execute and
deliver (at the expense of such Grantor) to the Directing Second Lien Security
Agent such termination statements, releases and other documents as the Directing
Second Lien Security Agent or such Grantor may reasonably request to effectively
confirm such release.

(ii) If any Additional Second Lien Obligations have been issued, until the
Discharge of Second Lien Obligations occurs, the Revolving Facility Agent, for
itself and on behalf of the other Revolving Facility Secured Parties, hereby
irrevocably constitutes and appoints the Directing Second Lien Security Agent
and any officer or agent of the Directing Second Lien Security Agent, with full
power of substitution, as its true and lawful attorney in fact with full
irrevocable power and authority in the place and stead of the Revolving Facility
Agent or such Revolving Facility Secured Party or in the Directing Second Lien
Security Agent’s own name, from time to time in the Directing Second Lien
Security Agent’s discretion, for the purpose of carrying out the terms of this
Section 3.4(b) with respect to Notes Priority Collateral, to take any and all
appropriate action and to execute any and all documents and instruments which
may be necessary to accomplish the purposes of this Section 3.4(b) with respect
to Notes Priority Collateral, including any endorsements or other instruments of
transfer or release.

(iii) If any Additional Second Lien Obligations have been issued, until the
Discharge of Second Lien Obligations occurs, to the extent that the Second Lien
Secured Parties (a) have released any Lien on Notes Priority Collateral and any
such Lien is later reinstated or (b) obtain any new Second Priority Liens (or,
after the Discharge of First Lien Obligations, First Priority Liens) on assets
constituting Notes Priority Collateral from Grantors, then the Revolving
Facility Secured Parties shall be granted a Third Priority Lien (or, after the
Discharge of First Lien Obligations, a Second Priority Lien) on any such Notes
Priority Collateral.

(c) Insurance – Prior to Discharge of First Lien Obligations. Unless and until
the Discharge of First Lien Obligations has occurred, the Directing First Lien
Security Agent shall have the sole and exclusive right, subject to the rights of
the Grantors under the First Lien Documents, to adjust settlement for any
Insurance policy covering the Notes Priority Collateral in the event of any loss
thereunder and to approve any award granted in any condemnation or similar
proceeding (or any deed in lieu of condemnation) in respect of the Notes
Priority Collateral. If (i) at any time after any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent or any Second Lien
Secured Party or (ii) the Revolving Facility Agent or any Revolving Facility
Secured Party shall, at any time, receive any Proceeds of any such Insurance
policy or any such award or payment in contravention of this Section 3.4(c), it
shall pay such Proceeds over to the Directing First Lien Security Agent in
accordance with the terms of Section 3.3(a).

 

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(d) Insurance – After Discharge of First Lien Obligations. After the Discharge
of First Lien Obligations has occurred, and, if any Additional Second Lien
Obligations have been issued, unless and until the Discharge of Second Lien
Obligations has occurred, the Directing Second Lien Security Agent shall have
the sole and exclusive right, subject to the rights of the Grantors under the
Second Lien Documents, to adjust settlement for any Insurance policy covering
the Notes Priority Collateral in the event of any loss thereunder and to approve
any award granted in any condemnation or similar proceeding (or any deed in lieu
of condemnation) in respect of the Notes Priority Collateral. If the Revolving
Facility Agent or any Revolving Facility Secured Party shall, at any time,
receive any Proceeds of any such insurance policy or any such award or payment
in contravention of this Section 3.4(d), it shall pay such Proceeds over to the
Directing Second Lien Security Agent in accordance with the terms of
Section 3.3(b).

(e) Amendments to, and Refinancing of, First Lien Documents.

(i) The First Lien Documents may be amended, restated, amended and restated,
replaced, supplemented or otherwise modified in accordance with their terms and
the First Lien Documents may be Refinanced, in each case, without notice to, or
the consent of, the Revolving Facility Agent or the other Revolving Facility
Secured Parties, and, if any Additional Second Lien Obligations have been
issued, the Second Lien Security Agent or the other Second Lien Secured Parties,
all without affecting the Lien subordination or other provisions of this
Agreement; provided, however, that any such amendment, restatement, amendment
and restatements, replacement, supplement, modification or Refinancing of the
First Lien Documents shall not, without the consent of the Revolving Facility
Security Agent and, if any Additional Second Lien Obligations have been issued,
the Directing Second Lien Security Agent:.

(A) add any limitation on the optional or mandatory prepayment of the loans
under the Revolving Facility Credit Agreement, any other Revolving Facility
Document, any Additional Second Lien Obligations Agreement or any other Second
Lien Documents; or

(B) except as otherwise contemplated or required by the First Lien Documents (as
in effect on the date hereof) and except in connection with any First Lien DIP
Financing or First Lien Revolving Facility Priority Collateral DIP Financing
permitted hereunder, expressly subordinate the Lien on all or substantially all
of the Notes Priority Collateral to the Lien of any other creditor on the Notes
Priority Collateral; provided that notwithstanding the provisions of this
Section 3.4(e), the First Lien Documents may be amended, restated, amended and
restated, replaced, supplemented or otherwise modified and/or Refinanced from
time to time in accordance with their terms in order to effect the making or
provision of (x) any “Incremental Term Facility” or any “Incremental Revolving
Facility,” (y) “Replacement Term Loan” or “Replacement Revolving Facility” or
(z) any “Extended Term Loans,” “Extended Revolving Loans” or “Extended Revolving
Credit Commitment” (each as defined in the First Lien Credit Agreement), in each
case without notice to, or the consent of, the Revolving Facility Agent, any
other Revolving Facility Secured Party, any Second Lien Security Agent or any
other Second Lien Secured Party.

 

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Subject to the provisions of the Revolving Facility Documents and the Second
Lien Documents, the First Lien Documents may be Refinanced to the extent the
terms and conditions of such Refinancing Indebtedness meet the requirements of
this Section 3.4(e); provided that the holders of such Refinancing Indebtedness
deliver an Intercreditor Agreement Joinder to the Security Agents.

(ii) In the event the First Lien Security Agent or the First Lien Secured
Parties and the relevant Grantor enter into any amendment, waiver or consent in
respect of any of the First Lien Security Documents for the purpose of adding
to, or deleting from, or waiving or consenting to any departures from any
provisions of, any First Lien Security Document or changing in any manner the
rights of the First Lien Security Agent, such First Lien Secured Parties, the
Company or any other Grantor thereunder, in each case with respect to or
relating to the Notes Priority Collateral, then such amendment, waiver or
consent shall apply automatically to any comparable provision of the Comparable
Revolving Facility Security Document and, if any Additional Second Lien
Obligations have been issued, the Comparable Second Lien Security Document
without the consent of the Revolving Facility Lien Security Agent, the Revolving
Facility Secured Parties, the Second Lien Security Agent or the Second Lien
Secured Parties and without any action by the Revolving Facility Agent, the
Second Lien Security Agent, the Company or any other Grantor.

(iii) The First Lien Security Agent shall endeavor to give prompt notice of any
amendment, waiver or consent of a First Lien Document to the Revolving Facility
Agent and, if any Additional Second Lien Obligations have been issued, the
Second Lien Security Agent after the effective date of such amendment, waiver or
consent; provided, that the failure of the First Lien Security Agent to give any
such notice shall not affect the priority of the First Lien Security Agent’s
Liens as provided herein or the validity or effectiveness of any such amendment
as against the Grantors.

(f) Amendments to, and Refinancing of, Second Lien Documents.

(i) If any Additional Second Lien Obligations are issued, then, thereafter, the
Second Lien Documents may be amended, restated, amended and restated, replaced,
supplemented or otherwise modified in accordance with their terms and the Second
Lien Documents may be Refinanced, in each case, without notice to, or the
consent of, the Revolving Facility Agent, the other Revolving Facility Secured
Parties, the First Lien Security Agent or the other First Lien Secured Parties,
all without affecting the Lien subordination or other provisions of this
Agreement; provided, however, that any such amendment, restatement, replacement,
amendment and restatement, supplement, modification or Refinancing of the Second
Lien Documents at any time after the issuance of such Additional Second Lien
Obligations, shall not, without the consent of the Revolving Facility Security
Agent and the Directing First Lien Security Agent:

(A) change or add any limitation on the optional or mandatory prepayment of the
loans under the Revolving Facility Credit Agreement, any other

 

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Revolving Facility Document, the First Lien Credit Agreement or any other First
Lien Document, in each case in any manner adverse to the Revolving Facility
Secured Parties or the First Lien Secured Parties;

(B) (x) change to an earlier date, any date upon which regularly scheduled
amortization payments of principal or interest (including the scheduled final
maturity date) on the Second Lien Obligations are due under the applicable
Additional Second Lien Obligations Agreement or a Refinancing thereof or any
other Second Lien Document or a Refinancing thereof or increase the amount of
any such scheduled amortization in excess of that applicable to the Indebtedness
under the applicable Additional Second Lien Obligations Agreement (provided that
nothing herein shall prohibit any optional prepayments under any Additional
Second Lien Obligations Agreement or other Second Lien Documents to the extent
otherwise permitted by the terms of the First Lien Documents) or (y) shorten the
scheduled final maturity date of any principal amount of Second Lien Obligations
under the applicable Additional Second Lien Obligations Agreement or a
Refinancing thereof, in each case under clauses (x) or (y), other than for
administrative reasons;

(C) add or include any financial maintenance covenant in the applicable
Additional Second Lien Obligations Agreement or any other Second Lien Document
unless the First Lien Documents are amended, restated, amended and restated,
replaced, supplemented or otherwise modified or Refinanced to add or include
such covenant for the benefit of the “term lenders” thereunder and the financial
maintenance covenant added to the applicable Additional Second Lien Obligations
Agreement or any other Second Lien Document is the same as that added to the
First Lien Documents (subject to customary set-back requirements); or

(D) change or add any negative covenant (for the avoidance of doubt, other than
a financial maintenance covenant) or event of default in the applicable
Additional Second Lien Obligations Agreement or any other Second Lien Document
in a manner that is more restrictive taken as a whole with all such changes or
additions than the First Lien Credit Agreement, as in effect on the date hereof
(unless such changes or additions are accompanied by corresponding changes or
additions in the First Lien Documents (maintaining any appropriate cushions
consistent with those in existence as of the date hereof));

provided that notwithstanding the provisions of this Section 3.4(f), if any
Additional Second Lien Obligations are issued, the Second Lien Documents may be
amended, restated, amended and restated, replaced, supplemented or otherwise
modified and/or Refinanced from time to time in accordance with their terms in
order to effect the making or provision of (x) any “Incremental Term Facility”,
(y) any “Replacement Term Loan” or (z) any “Extended Term Loans” (each as
defined in the applicable Additional Second Lien Obligations Agreement in a
manner consistent with the First Lien Credit Agreement), in each case without
notice to, or the consent of, the First Lien Security Agent, any other First
Lien Secured Party, the Revolving Facility Security Agent or any other Revolving
Facility Secured Party.

 

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Subject to the provisions of the First Lien Documents and the Revolving Facility
Documents, the Second Lien Documents may be Refinanced to the extent the terms
and conditions of such Refinancing Indebtedness meet the requirements of this
Section 3.4(f); provided that the holders of such Refinancing Indebtedness
deliver an Intercreditor Agreement Joinder to the Security Agents.

(ii) Following the Discharge of First Lien Obligations, if any Additional Second
Lien Obligations have been issued, in the event the Second Lien Security Agent
or the Second Lien Secured Parties and the relevant Grantor enter into any
amendment, waiver or consent in respect of any of the Second Lien Security
Documents for the purpose of adding to, or deleting from, or waiving or
consenting to any departures from any provisions of, any Second Lien Security
Document or changing in any manner the rights of the Second Lien Security Agent,
such Second Lien Secured Parties, the Company or any other Grantor thereunder,
in each case with respect to or relating to the Notes Priority Collateral, then
such amendment, waiver or consent shall apply automatically to any comparable
provision of the Comparable Revolving Facility Security Document without the
consent of the Revolving Facility Lien Security Agent or the Revolving Facility
Secured Parties and without any action by the Revolving Facility Agent, the
Company or any other Grantor.

(iii) If any Additional Second Lien Obligations have been issued, the Second
Lien Security Agent shall endeavor to give prompt notice of any amendment,
waiver or consent of a Second Lien Document to the First Lien Security Agent and
the Revolving Facility Agent after the effective date of such amendment, waiver
or consent; provided, that the failure of the Second Lien Security Agent to give
any such notice shall not affect the priority of the Second Lien Security
Agent’s Liens as provided herein or the validity or effectiveness of any such
amendment as against the Grantors.

(g) Rights As Unsecured Creditors.

(i) Except as otherwise set forth in this Agreement, the Revolving Facility
Agent and the Revolving Facility Secured Parties may exercise rights and
remedies as unsecured creditors against the Company or any other Grantor in
accordance with the terms of the Revolving Facility Documents to which it is a
party and applicable law. Except as otherwise set forth in this Agreement,
nothing in this Agreement shall prohibit the receipt by the Revolving Facility
Agent or any Revolving Facility Secured Parties of the required payments of
interest, principal and other amounts in respect of the Revolving Facility
Obligations so long as such receipt is not the direct or indirect result of the
exercise by the Revolving Facility Agent or any Revolving Facility Secured
Parties of rights or remedies as a secured creditor (including set off) in
respect of the Notes Priority Collateral in contravention of this Agreement or
enforcement in contravention of this Agreement of any Lien on Notes Priority
Collateral held by any of them. In the event the Revolving Facility Agent or any
other Revolving Facility Secured Party becomes a judgment Lien creditor in
respect of Notes Priority Collateral as a result of its enforcement of its
rights as an unsecured creditor, such judgment Lien shall be subordinated to
(x) the Liens securing First Lien Obligations and (y) if any Additional Second
Lien Obligations have been issued, the Liens securing the Second Lien
Obligations, in each case, on the same basis as the other Liens on the Notes
Priority

 

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Collateral securing the Revolving Facility Obligations are so subordinated to
such Liens securing the First Lien Obligations and Second Lien Obligations,
respectively, under this Agreement.

(ii) Except as otherwise set forth in this Agreement, if any Additional Second
Lien Obligations have been issued, the Second Lien Security Agent and the Second
Lien Secured Parties may exercise rights and remedies as unsecured creditors
against the Company or any other Grantor in accordance with the terms of the
Second Lien Documents to which it is a party and applicable law. Except as
otherwise set forth in this Agreement, nothing in this Agreement shall prohibit
the receipt by the Second Lien Security Agent or any other Second Lien Secured
Parties of the required payments of interest, principal and other amounts in
respect of the Second Lien Obligations so long as such receipt is not the direct
or indirect result of the exercise by the Second Lien Security Agent or any
other Second Lien Secured Parties of rights or remedies as a secured creditor
(including set off) in respect of the Notes Priority Collateral in contravention
of this Agreement or enforcement in contravention of this Agreement of any Lien
held by any of them. In the event the Second Lien Security Agent or any other
Second Lien Secured Party becomes a judgment Lien creditor in respect of Notes
Priority Collateral as a result of its enforcement of its rights as an unsecured
creditor, such judgment Lien shall be subordinated to the Liens securing the
First Lien Obligations on the same basis as the other Liens on the Notes
Priority Collateral securing the Second Lien Obligations are so subordinated to
such Liens securing the First Lien Obligations under this Agreement.

(iii) Except as otherwise set forth in this Agreement (including under Sections
3.1(a) and 3.2(a)), nothing in this Agreement (x) impairs or otherwise adversely
affects any rights or remedies the First Lien Security Agent or the other First
Lien Secured Parties may have with respect to the Notes Priority Collateral and
(y) from and after the Discharge of First Lien Obligations, if any Additional
Second Lien Obligations have been issued, impairs or otherwise adversely affects
any rights or remedies the Second Lien Security Agent or the other Second Lien
Secured Parties may have with respect to the Notes Priority Collateral.

(h) Bailee for Perfection – First Lien Security Agent.

(i) The Directing First Lien Security Agent agrees to hold or control that part
of the Notes Priority Collateral that is in its possession or control (or in the
possession or control of its agents or bailees) to the extent that possession or
control thereof is taken to perfect a Lien thereon under the UCC or other
applicable law (such Notes Priority Collateral being, the “Pledged Notes
Priority Collateral”) as collateral agent for the First Lien Secured Parties and
as bailee for and, with respect to any Notes Priority Collateral that cannot be
perfected in such manner, as agent for, (x) if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent (on behalf of
itself and the other Second Lien Secured Parties) and (y) Revolving Facility
Agent (on behalf of itself and the other Revolving Facility Secured Parties) and
any assignee thereof solely for the purpose of perfecting the security interest
granted under the First Lien Documents, the Second Lien Documents and the
Revolving Facility Documents, respectively, subject to the terms and conditions
of this Section 3.4(h). The Directing First Lien Security Agent agrees that, if
it shall at any time obtain any landlord waiver or bailee’s letter or similar
agreement or arrangement granting it rights or access to Notes Priority
Collateral, the Directing First Lien Security Agent shall take such actions with
respect to

 

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such landlord waiver, bailee’s letter or similar agreement or arrangement as
sub-agent or gratuitous bailee for the relevant other Security Agents, solely
for the purpose of perfecting the Liens of the relevant other Security Agents
and subject to the terms and conditions of this Agreement.

(ii) Subject to the terms of this Agreement, until the Discharge of First Lien
Obligations has occurred, the Directing First Lien Security Agent shall be
entitled to deal with the Pledged Notes Priority Collateral in accordance with
the terms of the First Lien Documents as if the Liens of, (x) if any Additional
Second Lien Obligations have been issued, the Second Lien Security Agent under
the Second Lien Security Documents and (y) the Revolving Facility Agent under
the Revolving Facility Security Documents did not exist. The rights of the
Second Lien Security Agent and the Revolving Facility Agent shall at all times
be subject to the terms of this Agreement and to the First Lien Security Agent’s
rights under the First Lien Documents.

(iii) The Directing First Lien Security Agent shall have no obligation
whatsoever to any First Lien Secured Party, the Second Lien Security Agent, any
Second Lien Secured Party, the Revolving Facility Agent or any Revolving
Facility Secured Party to ensure that the Pledged Notes Priority Collateral is
genuine or owned by any of the Grantors or to preserve rights or benefits of any
Person except as expressly set forth in this Section 3.4(h). The duties or
responsibilities of the First Lien Security Agent under this Section 3.4(h)
shall be limited solely to holding the Pledged Notes Priority Collateral as
bailee or agent in accordance with this Section 3.4(h).

(iv) The Directing First Lien Security Agent acting pursuant to this
Section 3.4(h) shall not have by reason of the First Lien Security Documents,
the Second Lien Security Documents, the Revolving Facility Documents, this
Agreement or any other document a fiduciary relationship in respect of any First
Lien Secured Party, the Second Lien Security Agent, any Second Lien Secured
Party, the Revolving Facility Agent or any Revolving Facility Secured Party.

(v) Upon the Discharge of First Lien Obligations, the Directing First Lien
Security Agent shall deliver or cause to be delivered the remaining Pledged
Notes Priority Collateral (if any) in its possession or in the possession of its
agents or bailees, together with any necessary endorsements, (A) first, to the
Directing Second Lien Security Agent to the extent that any Additional Second
Lien Obligations have been issued and the applicable Second Lien Obligations
remain outstanding, (B) second, to the Revolving Facility Agent to the extent
Revolving Facility Obligations remain outstanding and (C) third, to the
applicable Grantor to the extent no First Lien Obligations, Second Lien
Obligations or Revolving Facility Obligations remain outstanding (in each case,
so as to allow such Person to obtain control of such Pledged Notes Priority
Collateral) and will cooperate with the Directing Second Lien Security Agent,
the Revolving Facility Agent or such Grantor, as the case may be, in assigning
(without recourse to or warranty by the Directing First Lien Security Agent or
any other First Lien Secured Party or agent or bailee thereof) control over any
other Pledged Notes Priority Collateral under its control. The Directing First
Lien Security Agent further agrees to take all other action reasonably requested
by such Person (at the sole cost and expense of the Grantors or such Person) in
connection with such Person obtaining a First Priority security interest in the
Pledged Notes Priority Collateral or as a court of competent jurisdiction may
otherwise direct.

 

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(vi) Notwithstanding anything to the contrary herein:

(A) if, for any reason, upon the Discharge of First Lien Obligations, any
Additional Second Lien Obligations have been issued and the applicable Second
Lien Obligations remain outstanding, all rights of the First Lien Security Agent
hereunder and under the First Lien Security Documents (1) with respect to the
delivery and control of any part of the Notes Priority Collateral, and (2) to
direct, instruct, vote upon or otherwise influence the maintenance or
disposition of such Notes Priority Collateral, shall immediately, and (to the
extent permitted by law) without further action on the part of either of the
Second Lien Security Agent or the First Lien Security Agent, pass to the
Directing Second Lien Security Agent, who shall thereafter hold such rights for
the benefit of the Second Lien Secured Parties. The Directing First Lien
Security Agent agrees that it will, if any such Second Lien Obligations remain
outstanding upon the Discharge of First Lien Obligations, take any other action
required by any law or reasonably requested by the Directing Second Lien
Security Agent (subject to any limitations set forth in the Second Lien
Documents), in connection with the Directing Second Lien Security Agent’s
establishment and perfection of a First Priority security interest in the Notes
Priority Collateral; and

(B) if, for any reason, any Revolving Facility Obligations remain outstanding
upon the Discharge of First Lien Obligations and (if any Additional Second Lien
Obligations have been issued) the Discharge of Second Lien Obligations, all
rights of the First Lien Security Agent hereunder and under the First Lien
Security Documents, and all rights of the Second Lien Security Agent hereunder
and under the Second Lien Security Documents (1) with respect to the delivery
and control of any part of the Notes Priority Collateral, and (2) to direct,
instruct, vote upon or otherwise influence the maintenance or disposition of
such Notes Priority Collateral, shall immediately, and (to the extent permitted
by law) without further action on the part of the Revolving Facility Agent, the
First Lien Security Agent or the Second Lien Security Agent, pass to the
Revolving Facility Agent, who shall thereafter hold such rights for the benefit
of the Revolving Facility Secured Parties. Each of the Directing First Lien
Security Agent and the Directing Second Lien Security Agent agrees that it will,
if any Revolving Facility Obligations remain outstanding upon the Discharge of
First Lien Obligations and (if any Additional Second Lien Obligations have been
issued) the Discharge of Second Lien Obligations, take any other action required
by any law or reasonably requested by the Revolving Facility Agent (subject to
any limitations set forth in the Revolving Facility Documents), in connection
with the Revolving Facility Agent’s establishment and perfection of a First
Priority security interest in the Notes Priority Collateral.

(vii) Notwithstanding anything to the contrary contained herein, if for any
reason, prior to the Discharge of Revolving Facility Obligations, the Directing
First Lien Security Agent acquires possession of any Pledged Revolving Facility
Priority Collateral (as defined below), the Directing First Lien Security Agent
shall hold same as bailee and/or agent to the same extent as is provided in
preceding clause (i) with respect to Pledged Notes Priority

 

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Collateral, provided that as soon as is practicable the Directing First Lien
Security Agent shall deliver or cause to be delivered such Pledged Revolving
Facility Priority Collateral to the Revolving Facility Agent in a manner
otherwise consistent with the requirements of preceding clause (v).

(i) Bailee for Perfection – Second Lien Security Agent.

(i) After the Discharge of First Lien Obligations has occurred, and, if any
Additional Second Lien Obligations have been issued, to the extent that the
Directing Second Lien Security Agent is (or its agents or bailees are) in
possession or control of any Pledged Notes Priority Collateral, the Directing
Second Lien Security Agent agrees to hold or control that part of the Notes
Priority Collateral as collateral agent for the Second Lien Secured Parties and
as bailee for and, with respect to any Notes Priority Collateral that cannot be
perfected in such manner, as agent for, the Revolving Facility Agent (on behalf
of itself and the other Revolving Facility Secured Parties) and any assignee
thereof solely for the purpose of perfecting the security interest granted under
the Second Lien Documents and the Revolving Facility Documents, respectively,
subject to the terms and conditions of this Section 3.4(i). The Directing Second
Lien Security Agent agrees that, if it shall at any time obtain any landlord
waiver or bailee’s letter or similar agreement or arrangement granting it rights
or access to Notes Priority Collateral, the Directing Second Lien Security Agent
shall take such actions with respect to such landlord waiver, bailee’s letter or
similar agreement or arrangement as sub-agent or gratuitous bailee for the
Revolving Facility Agent, solely for the purpose of perfecting the Liens of the
Revolving Facility Agent and subject to the terms and conditions of this
Agreement.

(ii) Subject to the terms of this Agreement, after the Discharge of First Lien
Obligations has occurred and, if any Additional Second Lien Obligations have
been issued, until the Discharge of Second Lien Obligations has occurred, the
Directing Second Lien Security Agent shall be entitled to deal with the Pledged
Notes Priority Collateral in accordance with the terms of the Second Lien
Documents as if the Liens of the Revolving Facility Agent under the Revolving
Facility Security Documents did not exist. The rights of the Revolving Facility
Agent in the Term Lien Priority Collateral shall at all times be subject to the
terms of this Agreement and to the Second Lien Security Agent’s rights under the
Second Lien Documents.

(iii) The Directing Second Lien Security Agent shall have no obligation
whatsoever to any Second Lien Secured Party, the Revolving Facility Agent or any
Revolving Facility Secured Party to ensure that the Pledged Notes Priority
Collateral is genuine or owned by any of the Grantors or to preserve rights or
benefits of any Person except as expressly set forth in this Section 3.4(i). The
duties or responsibilities of the Directing Second Lien Security Agent under
this Section 3.4(i) shall be limited solely to holding the Pledged Notes
Priority Collateral as bailee or agent in accordance with this Section 3.4(i).

(iv) The Directing Second Lien Security Agent acting pursuant to this
Section 3.4(i) shall not have by reason of the First Lien Security Documents,
the Second Lien Security Documents, the Revolving Facility Documents, this
Agreement or any other document a fiduciary relationship in respect of any
Second Lien Secured Party, the First Lien Security Agent, any First Lien Secured
Party, the Revolving Facility Agent or any Revolving Facility Secured Party.

 

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(v) Following the Discharge of First Lien Obligations and, if any Additional
Second Lien Obligations have been issued, upon the Discharge of Second Lien
Obligations, the Directing Second Lien Security Agent shall deliver or cause to
be delivered the remaining Pledged Notes Priority Collateral (if any) in its
possession or in the possession of its agents or bailees, together with any
necessary endorsements, (A) first, to the Revolving Facility Agent to the extent
Revolving Facility Obligations remain outstanding and (B) second, to the
applicable Grantor to the extent no First Lien Obligations, Second Lien
Obligations or Revolving Facility Obligations remain outstanding (in each case,
so as to allow such Person to obtain control of such Pledged Notes Priority
Collateral) and will cooperate with the Revolving Facility Agent or such
Grantor, as the case may be, in assigning (without recourse to or warranty by
the Directing Second Lien Security Agent or any other Second Lien Secured Party
or agent or bailee thereof) control over any other Pledged Notes Priority
Collateral under its control. The Second Lien Security Agent further agrees to
take all other action reasonably requested by such Person (at the sole cost and
expense of the Grantors or such Person) in connection with such Person obtaining
a First Priority security interest in the Pledged Notes Priority Collateral or
as a court of competent jurisdiction may otherwise direct.

(vi) Notwithstanding anything to the contrary herein, if, for any reason, any
Revolving Facility Obligations remain outstanding upon the Discharge of First
Lien Obligations and, if any Additional Second Lien Obligations have been
issued, the Discharge of Second Lien Obligations, all rights of the Second Lien
Security Agent hereunder and under the Second Lien Security Documents (1) with
respect to the delivery and control of any part of the Notes Priority Collateral
and (2) to direct, instruct, vote upon or otherwise influence the maintenance or
disposition of such Notes Priority Collateral, shall immediately, and (to the
extent permitted by law) without further action on the part of either of the
Revolving Facility Agent or the Second Lien Security Agent, pass to the
Revolving Facility Agent, who shall thereafter hold such rights for the benefit
of the Revolving Facility Secured Parties. The Directing Second Lien Security
Agent agrees that it will, if any Revolving Facility Obligations remain
outstanding upon the Discharge of First Lien Obligations and, if any Additional
Second Lien Obligations have been issued, the Discharge of Second Lien
Obligations, take any other action required by any law or reasonably requested
by the Revolving Facility Agent (subject to any limitations set forth in the
Revolving Facility Documents), in connection with the Revolving Facility Agent’s
establishment and perfection of a First Priority security interest in the Notes
Priority Collateral.

(vii) Notwithstanding anything to the contrary contained herein, if for any
reason, prior to the Discharge of Revolving Facility Obligations, the Directing
Second Lien Security Agent acquires possession of any Pledged Revolving Facility
Priority Collateral, the Directing Second Lien Security Agent shall hold same as
bailee and/or agent to the same extent as is provided in preceding clause
(i) with respect to Pledged Notes Priority Collateral, provided that as soon as
is practicable the Directing Second Lien Security Agent shall deliver or cause
to be delivered such Pledged Revolving Facility Priority Collateral to the
Revolving Facility Agent in a manner otherwise consistent with the requirements
of preceding clause (v).

(j) When Discharge of First Lien Obligations Deemed to Not Have Occurred.
Notwithstanding anything to the contrary herein, if concurrently with (or
immediately after) the Discharge of First Lien Obligations, the Company or any
other Grantor enters into any Permitted

 

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Refinancing of any First Lien Priority Obligations, then such Discharge of First
Lien Obligations shall automatically be deemed not to have occurred for all
purposes of this Agreement, and the obligations under the Permitted Refinancing
shall automatically be treated as First Lien Priority Obligations (together with
the First Lien Secured Hedging Agreements on the basis provided in the
definition of “First Lien Documents” contained herein) for all purposes of this
Agreement, including for purposes of the Lien priorities and rights in respect
of Collateral set forth herein, the term “First Lien Credit Agreement” shall be
deemed appropriately modified to refer to such Permitted Refinancing and the
First Lien Security Agent under such First Lien Documents shall be the Directing
First Lien Security Agent for all purposes hereof and the new secured parties
under such First Lien Documents (together with the First Lien Facility Bank
Product Creditors as provided herein) shall automatically be treated as First
Lien Secured Parties for all purposes of this Agreement. Upon receipt of a
notice stating that the Company or any other Grantor has entered into a new
First Lien Document in respect of a Permitted Refinancing of First Lien
Obligations (which notice shall include the identity of the new security agent,
such agent, the “New First Lien Agent”), and delivery by the New First Lien
Agent of an Intercreditor Agreement Joinder, each of, if any Additional Second
Lien Obligations have been issued, the Second Lien Security Agent and the
Revolving Facility Agent shall promptly (i) enter into such documents and
agreements (including amendments, amendments and restatements or supplements to
this Agreement) as the Company or such New First Lien Agent shall reasonably
request in order to provide to the New First Lien Agent the rights contemplated
hereby, in each case consistent in all material respects with the terms of this
Agreement and (ii) deliver to the New First Lien Agent any Pledged Notes
Priority Collateral held by the Second Lien Security Agent or the Revolving
Facility Agent, as the case may be, together with any necessary endorsements (or
otherwise allow the New First Lien Agent to obtain control of such Pledged Notes
Priority Collateral). The New First Lien Agent shall agree to be bound by the
terms of this Agreement. If the new First Lien Obligations under the new First
Lien Documents are secured by assets of the Grantors of the type constituting
Notes Priority Collateral that do not also secure the Revolving Facility
Obligations or, if any Additional Second Lien Obligations have been issued, the
Second Lien Obligations, as the case may be, then the Revolving Facility
Obligations or Second Lien Obligations, as the case may be, shall be secured at
such time by a Third Priority Lien (or, in the case any Additional Second Lien
Obligations have not been issued, a Second Priority Lien securing the Revolving
Facility Obligations) or a Second Priority Lien, respectively, on such assets to
the same extent provided in the Revolving Facility Security Documents and the
Second Lien Security Documents, as the case may be, with respect to the other
Notes Priority Collateral. If the new First Lien Obligations under the new First
Lien Documents are secured by assets of the Grantors of the type constituting
Revolving Facility Priority Collateral that do not also secure the Revolving
Facility Obligations or, if any Additional Second Lien Obligations have been
issued, the Second Lien Priority Obligations, then the Revolving Facility
Obligations and Second Lien Obligations shall be secured at such time by a First
Priority Lien and a Third Priority Lien, respectively, on such assets to the
same extent provided in the Revolving Facility Security Documents with respect
to the other Revolving Facility Priority Collateral.

(k) When Discharge of Second Lien Obligations Deemed to Not Have Occurred.
Notwithstanding anything to the contrary herein, if any Additional Second Lien
Obligations have been issued, and if concurrently with (or immediately after)
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Second Lien Obligations, the Company or any other Grantor enters into any
Permitted Refinancing of any Second Lien Priority Obligations, then such
Discharge of Second Lien Obligations shall automatically be deemed not to have
occurred for all purposes of this Agreement, and the obligations under the
Permitted Refinancing shall automatically be treated as Second Lien Priority
Obligations for all purposes of this Agreement, including for purposes of the
Lien priorities and rights in respect of Collateral set forth herein, the term
“Additional Second Lien Obligations Agreement” shall be deemed appropriately
modified to refer to such Permitted Refinancing and the Second Lien Security
Agent under such Second Lien Documents shall be the Directing Second Lien
Security Agent for all purposes hereof and the new secured parties under such
Second Lien Documents shall automatically be treated as Second Lien Secured
Parties for all purposes of this Agreement. Upon receipt of a notice stating
that the Company or any other Grantor has entered into a new Second Lien
Document in respect of a Permitted Refinancing of Second Lien Obligations (which
notice shall include the identity of the new security agent, such agent, the
“New Second Lien Agent”), and delivery by the New Second Lien Agent of an
Intercreditor Agreement Joinder, each of the First Lien Security Agent and the
Revolving Facility Agent shall promptly (i) enter into such documents and
agreements (including amendments or supplements to this Agreement) as the
Company or such New Second Lien Agent shall reasonably request in order to
provide to the New Second Lien Agent the rights contemplated hereby, in each
case consistent in all material respects with the terms of this Agreement and
(ii) following the Discharge of First Lien Obligations, deliver to the New
Second Lien Agent any Pledged Notes Priority Collateral held by the Revolving
Facility Agent, together with any necessary endorsements (or otherwise allow the
New Second Lien Agent to obtain control of such Pledged Notes Priority
Collateral). The New Second Lien Agent shall agree to be bound by the terms of
this Agreement. If the new Second Lien Obligations under the new Second Lien
Documents are secured by assets of the Grantors of the type constituting Notes
Priority Collateral that do not also secure the First Lien Obligations or the
Revolving Facility Obligations, as the case may be, then the First Lien
Obligations or the Revolving Facility Obligations, as the case may be, shall be
secured at such time by a First Priority Lien and Third Priority Lien,
respectively, on such assets to the same extent provided in the First Lien
Security Documents and the Revolving Facility Security Documents, as the case
may be, with respect to the other Notes Priority Collateral. If the new Second
Lien Obligations under the new Second Lien Documents are secured by assets of
the Grantors of the type constituting Revolving Facility Priority Collateral
that do not also secure the Revolving Facility Obligations or the First Lien
Obligations, then the Revolving Facility Obligations and First Lien Obligations
shall be secured at such time by a First Priority Lien and a Second Priority
Lien, respectively, on such assets to the same extent provided in the Revolving
Facility Security Documents with respect to the other Revolving Facility
Priority Collateral.

(l) Option to Purchase First Lien Obligations.

(i) Without prejudice to the enforcement of remedies by the First Lien Security
Agent and the First Lien Secured Parties, if any Additional Second Lien
Obligations have been issued, the Second Lien Secured Parties (in each case who
must meet all eligibility standards contained in all relevant First Lien
Documents) (an “Eligible First Lien Purchaser”) shall have the right to purchase
(the “First Lien Purchase Option”) on a pro rata basis by way of assignment (and
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First Lien Secured Parties under the First Lien Documents (other than in respect
of services giving rise to First Lien Bank Product Obligations and First Lien
Secured Hedging Obligations)), at any time during the exercise period described
in clause (iii) below of this Section 3.4(l), all, but not less than all, of the
First Lien Obligations (inclusive of the First Lien Priority Obligations and the
Excess First Lien Obligations) (other than the First Lien Obligations of a
Defaulting First Lien Secured Party), including all principal of and accrued and
unpaid interest and fees on and all prepayment or acceleration penalties and
premiums in respect of all First Lien Obligations outstanding at the time of
purchase; provided that at the time of (and as a condition to) any purchase
pursuant to this Section 3.4(l), all commitments pursuant to any then
outstanding First Lien Credit Agreement shall have terminated and all First Lien
Secured Hedging Agreements also shall have been terminated in accordance with
their terms. Any purchase pursuant to this Section 3.4(l)(i) shall be made as
follows:

(A) for a purchase price equal to the sum of (1) in the case of all loans,
advances or other similar extensions of credit that constitute First Lien
Obligations (including unreimbursed amounts drawn in respect of letters of
credit, but excluding the undrawn amount of then outstanding letters of credit
and excluding First Lien Bank Product Obligations), 100% of the principal amount
thereof and all accrued and unpaid interest thereon through the date of purchase
(without regard, however, to any unaccrued acceleration or other prepayment
penalties or premiums other than customary breakage costs), (2) in the case of
any First Lien Bank Product Obligations, cash collateral in such amounts as the
First Lien Security Agent reasonably determines is necessary to secure the First
Lien Security Agent and the other First Lien Secured Parties in connection with
such First Lien Bank Product Obligations, (3) in the case of any First Lien
Secured Hedging Agreement, the aggregate amount then owing to each First Lien
Secured Hedging Creditor (which is a First Lien Secured Party) thereunder
pursuant to the terms of the respective First Lien Secured Hedging Agreement,
including all amounts owing to such First Lien Secured Hedging Creditor as a
result of the termination (or early termination) thereof (in each case, to the
extent of its interest as a First Lien Secured Party), (4) in the case of the
undrawn amount of then outstanding letters of credit under any Incremental
Revolving Facility (as defined in the First Lien Credit Agreement), cash
collateral in an amount equal to 103% of the aggregate undrawn amount of such
letters of credit and the aggregate fronting and other fees which will accrue
thereon through the stated maturity of the letters of credit (assuming no
drawings thereon before stated maturity), (5) all accrued and unpaid fees,
expenses, indemnities and other amounts (other than any unaccrued prepayment
penalties or premiums or similar fees) through the date of purchase and (6) in
the case of contingent or unliquidated First Lien Obligations for which a claim
has been made against (or identified by) the First Lien Secured Parties and
indemnification or payment is required under the First Lien Documents, cash
collateral in such amounts as the First Lien Security Agent reasonably
determines to be necessary to secure the First Lien Security Agent and the other
First Lien Secured Parties in connection with such contingent or unliquidated
First Lien Obligations; it being understood and agreed that (w) if at any time
those amounts (if any) then on deposit with the Directing First Lien Security
Agent as described in clause (4) above exceed 103% of the sum of the aggregate
undrawn amount of all then outstanding letters of credit and the aggregate
fronting and other fees accrued thereon before stated maturity, such excess

 

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shall be returned to the respective Eligible First Lien Purchaser or Eligible
First Lien Purchasers (as their interests appear), (x) at such time as all
letters of credit have been cancelled, expired or been fully drawn, as the case
may be, any excess cash collateral deposited as described above in clause
(4) (and not previously applied or released as provided above) shall be returned
to the respective Eligible First Lien Purchaser or Eligible First Lien
Purchasers, as their interests appear, (y) at such time as all First Lien Bank
Product Agreements have been terminated, any excess cash collateral deposited as
described above in clause (2) (and not previously applied or released as
provided above) shall be returned to the respective Eligible First Lien
Purchaser or Eligible First Lien Purchasers, as their interests appear, and
(z) at such time as all contingent or unliquidated First Lien Obligations
described in clause (6) are settled or otherwise resolved, any excess cash
collateral deposited as described above in clause (6) (and not applied or
previously released) shall be returned to the respective Eligible First Lien
Purchaser or Eligible First Lien Purchasers, as their interests appear. It is
understood and agreed that (A) at the time any fronting or other fees are owing
to an issuer with respect to any letter of credit, the First Lien Security Agent
may apply amounts deposited with it as described above to pay same and (B) upon
any drawing under any letter of credit, the First Lien Security Agent shall
apply amounts deposited with it as described above to repay the respective
unpaid drawing;

(B) with the purchase price described in preceding clause (A)(1) payable in cash
on the date of purchase against transfer to the respective Eligible First Lien
Purchaser or Eligible First Lien Purchasers (without recourse and without any
representations or warranties whatsoever, whether as to the enforceability of
any First Lien Obligation or the validity, enforceability, perfection, priority
or sufficiency of any Lien securing, or guarantee or other supporting obligation
for, any First Lien Obligation or as to any other matter whatsoever, except the
representations and warranties (1) that the transferor owns free and clear of
all Liens and encumbrances (other than participation interests not prohibited by
the First Lien Credit Agreement, in which case the purchase price described in
preceding clause (A)(1) shall be appropriately adjusted so that the Eligible
First Lien Purchaser or Eligible First Lien Purchasers do not pay amounts
represented by any participation interest which remains in effect), and has the
right to convey, whatever claims and interests it may have in respect of the
First Lien Obligations and (2) as to the amount of its portion of the First Lien
Obligations being acquired);

(C) with the purchase price described in preceding clause (A)(1) accompanied by
a waiver by the Directing Second Lien Security Agent (on behalf of itself and
the other Second Lien Secured Parties) of all claims arising out of this
Agreement and the transactions contemplated hereby as a result of exercising the
purchase option contemplated by this Section 3.4(l);

(D) with all amounts payable to the various First Lien Secured Parties in
respect of the assignments described above to be distributed to them by the
Directing First Lien Security Agent in accordance with their respective holdings
of the various First Lien Obligations; and

 

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(E) with such purchase to be made pursuant to assignment documentation in form
and substance reasonably satisfactory to, and prepared by counsel for, the
Directing First Lien Security Agent (with the reasonable cost of such counsel to
be paid by the respective Eligible First Lien Purchaser or Eligible First Lien
Purchasers); it being understood and agreed that the First Lien Security Agent
and each other First Lien Secured Party shall retain all rights to
indemnification as provided in the relevant First Lien Documents for all periods
prior to any assignment by them pursuant to the provisions of this
Section 3.4(l).

(ii) The right to exercise the First Lien Purchase Option shall be exercisable
and legally enforceable upon at least ten (10) Business Days’ prior written
notice of exercise (which notice, once given, (A) shall be irrevocable and fully
binding on the respective Eligible First Lien Purchaser or Eligible First Lien
Purchasers except as provided in clause (iii) below and (B) shall specify a date
of purchase not less than ten (10) Business Days, nor more than thirty
(30) calendar days, after the date of the receipt by the Directing First Lien
Security Agent of such notice) given to the Directing First Lien Security Agent
by an Eligible First Lien Purchaser; provided that in the event that the
Eligible First Lien Purchaser is an Eligible Revolving Facility Purchaser and
exercises its option to purchase Revolving Facility Obligations in accordance
with Section 4.4(j), the closing of the purchase of the First Lien Obligations
shall occur within the aforesaid period and prior to or contemporaneously with
the closing of such Eligible Revolving Facility Purchaser’s purchase of the
Revolving Facility Obligations in accordance with Section 4.4(j). Neither the
First Lien Security Agent nor any First Lien Secured Party shall have any
disclosure obligation to any Eligible First Lien Purchaser, any Second Lien
Security Agent or any Second Lien Secured Party in connection with any exercise
of such purchase option.

(iii) The right to purchase the First Lien Obligations as described in this
Section 3.4(l) may be exercised (by giving the irrevocable written notice
described in preceding clause (ii)) during the period that (1) begins on the
date occurring three (3) Business Days after the first to occur of (x) the date
of the acceleration of the final maturity of the loans under the First Lien
Credit Agreement, (y) the failure to pay all outstanding loans and obligations
in full in cash on the final maturity date of the First Lien Credit Agreement or
(z) the occurrence of an Insolvency or Liquidation Proceeding with respect to
the Company or any other Grantor which constitutes an event of default under the
First Lien Credit Agreement (in each case, so long as the acceleration, failure
to pay amounts due at final maturity or such Insolvency or Liquidation
Proceeding constituting an event of default has not been rescinded or cured
within ten (10) Business Days after any such event, and so long as any unpaid
amounts constituting First Lien Obligations remain owing); provided that if
there is any failure to meet the condition described in the proviso of preceding
clause (i) hereof, the aforementioned date shall be extended until the first
date upon which such condition is satisfied, and (2) ends on the tenth
(10th) Business Day after the start of the period described in clause (1) above.
If no Second Lien Secured Party timely exercises the aforementioned purchase
option, the First Lien Security Agent and First Lien Secured Parties shall have
no further obligations pursuant to this Section 3.4(l) and may take any further
actions in their sole discretion in accordance with the First Lien Documents and
this Agreement.

 

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(iv) The obligations of the First Lien Secured Parties to sell their respective
First Lien Obligations under this Section 3.4(l) are several and not joint and
several. To the extent any First Lien Secured Party breaches its obligation to
sell its First Lien Obligations under this Section 3.4(l) (a “Defaulting First
Lien Secured Party”), nothing in this Section 3.4(l) shall be deemed to require
the First Lien Security Agent or any First Lien Secured Party to purchase such
Defaulting First Lien Secured Party’s First Lien Obligations for resale to the
holders of Second Lien Obligations and in all cases, the First Lien Security
Agent and each First Lien Secured Party complying with the terms of this
Section 3.4(l) shall not be deemed to be in default of this Agreement or
otherwise be deemed liable for any action or inaction of any Defaulting First
Lien Secured Party; provided that nothing in this clause (iv) shall require any
Eligible First Lien Purchaser to purchase less than all of the First Lien
Obligations.

(v) Each Grantor irrevocably consents to any assignment effected to one or more
Eligible First Lien Purchasers pursuant to this Section 3.4(l) (so long as they
meet all eligibility standards contained in all relevant First Lien Documents,
other than obtaining the consent of any Grantor to an assignment to the extent
required by such First Lien Documents) for purposes of all First Lien Documents
and hereby agrees that no further consent to any such assignment pursuant to
this Section 3.4(l) from such Grantor shall be required.

3.5. Insolvency or Liquidation Proceedings.

(a) Finance and Sale Issues – First Lien Obligations. Until the Discharge of
First Lien Obligations has occurred, if the Company or any other Grantor shall
be subject to any Insolvency or Liquidation Proceeding and the Directing First
Lien Security Agent shall desire to permit the use of cash collateral (as such
term is defined in Section 363(a) of the Bankruptcy Code) constituting Notes
Priority Collateral or to permit the Company or any other Grantor to obtain
financing, whether from the First Lien Secured Parties or any other entity under
Section 364 of the Bankruptcy Code or any similar Debtor Relief Law that is
secured by a Lien that is (i) senior or pari passu with the Liens on the Notes
Priority Collateral securing the First Lien Priority Obligations, and
(ii) junior to the Liens on the Revolving Facility Priority Collateral securing
the Revolving Facility Priority Obligations (each, a “First Lien DIP
Financing”), then (x) if any Additional Second Lien Obligations have been
issued, each of the Second Lien Security Agent, on behalf of itself and the
other Second Lien Secured Parties, and (y) the Revolving Facility Agent, on
behalf of itself and the other Revolving Facility Secured Parties, agrees that
it will not oppose or raise any objection to or contest (or join with or support
any third party opposing, objecting or contesting) such use of cash collateral
constituting Notes Priority Collateral or such First Lien DIP Financing and will
not request adequate protection or any other relief in connection therewith
(except, as expressly agreed by the Directing First Lien Security Agent or to
the extent permitted by Section 3.5(c)) and, the Second Lien Security Agent and
the Revolving Facility Agent will each subordinate its Liens in the Notes
Priority Collateral to the Liens securing such First Lien DIP Financing (and all
interest and other obligations relating thereto); provided that (A) the
aggregate principal amount of the First Lien DIP Financing plus the aggregate
outstanding principal amount of First Lien Obligations for borrowed money under
the First Lien Documents plus the aggregate face amount of any letters of credit
issued and not reimbursed under the First Lien Documents shall not exceed the
First Lien Debt Cap and (B) (i) each of the Revolving Facility Agent and the
other Revolving Facility

 

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Secured Parties and, if any Additional Second Lien Obligations have been issued,
the Second Lien Security Agent and the other Second Lien Secured Parties, retain
a Lien on the Collateral to secure the Revolving Facility Priority Obligations
and the Second Lien Priority Obligations, as the case may be, and, with respect
to the Revolving Facility Priority Collateral only, with the same priority as
existed prior to the commencement of the Insolvency or Liquidation Proceeding,
(ii) to the extent that the First Lien Security Agent is granted adequate
protection in the form of a Lien, the Revolving Facility Agent and, if any
Additional Second Lien Obligations are issued, the Second Lien Security Agent
are permitted to seek a Lien (without objection from the First Lien Security
Agent or any First Lien Secured Party) on Collateral arising after the
commencement of the Insolvency or Liquidation Proceeding (so long as, with
respect to Notes Priority Collateral, such Lien is junior to the Liens securing
such First Lien DIP Financing and the First Lien Priority Obligations),
(iii) the foregoing provisions of this Section 3.5(a) shall not prevent the
Revolving Facility Agent and the Revolving Facility Secured Parties from
objecting to any provision in any DIP Financing relating to any provision or
content of a plan of reorganization or other plan of similar effect under any
Debtor Relief Laws that are inconsistent with this Agreement and (iv) the terms
of such First Lien DIP Financing or use of cash collateral do not require any
Grantor to seek any approval for any plan of reorganization or other plan of
similar effect under any Debtor Relief Laws that is inconsistent with the terms
of this Agreement. Each of the Revolving Facility Agent, on behalf of the
Revolving Facility Secured Parties, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent, on behalf of the
Second Lien Secured Parties, agrees that it will not raise any objection or
oppose a sale or other disposition of any Notes Priority Collateral free and
clear of its Liens (subject to attachment of Proceeds with respect to the Second
Priority Lien on the Notes Priority Collateral in favor of the Second Lien
Security Agent (if any Additional Second Lien Obligations have been issued) and
the Third Priority Lien (or, if any Additional Second Lien Obligations have not
been issued, the Second Priority Lien) on the Notes Priority Collateral in favor
of the Revolving Facility Agent, respectively, in the same order and manner as
otherwise set forth herein) or other claims under Section 363 of the Bankruptcy
Code, except for any objection or opposition that could be asserted by any
Second Lien Secured Party or Revolving Facility Secured Party, as the case may
be, as an unsecured creditor in any such Insolvency or Liquidation Proceeding,
if the First Lien Secured Parties have consented to such sale or disposition of
such assets; provided that the foregoing shall not prohibit the Second Lien
Security Agent, the other Second Lien Secured Parties, the Revolving Facility
Agent and the other Revolving Facility Secured Parties from seeking and
exercising credit bid rights pursuant to Section 363(k) of the Bankruptcy Code
in respect of any such sale or disposition; provided, further that such credit
bid may only be made if Discharge of First Lien Obligations (and, in the case of
a credit bid by the Revolving Facility Agent or the other Revolving Facility
Secured Parties, Discharge of Second Lien Obligations if any Additional Second
Lien Obligations have been issued) has occurred or will occur concurrently as a
result of a cash bid for such Notes Priority Collateral in addition to such
credit bid.

(b) Relief from the Automatic Stay.

(i) Until the Discharge of First Lien Obligations has occurred, each of the
Second Lien Security Agent, on behalf of itself and the other Second Lien
Secured Parties (if any Additional Second Lien Obligations have been issued),
and the Revolving Facility Agent, on

 

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behalf of itself and the other Revolving Facility Secured Parties, agrees that
none of them shall seek (or support any other person seeking) relief from the
automatic stay or any other stay in any Insolvency or Liquidation Proceeding in
respect of the Notes Priority Collateral without the prior written consent of
the Directing First Lien Security Agent.

(ii) If any Additional Second Lien Obligations have been issued, until the
Discharge of Second Lien Obligations has occurred, the Revolving Facility Agent,
on behalf of itself and the other Revolving Facility Secured Parties, agrees
that none of them shall seek (or support any other person seeking) relief from
the automatic stay or any other stay in any Insolvency or Liquidation Proceeding
in respect of the Notes Priority Collateral without the prior written consent of
the Directing Second Lien Security Agent.

(c) Adequate Protection.

(i) Each of (x) if any Additional Second Lien Obligations have been issued, the
Second Lien Security Agent, on behalf of itself and the other Second Lien
Secured Parties and (y) the Revolving Facility Agent, on behalf of itself and
the other Revolving Facility Secured Parties, agrees that none of them shall
contest (or support any other Person contesting) (i) any request by the First
Lien Security Agent or the First Lien Secured Parties for adequate protection or
similar protection under any Debtor Relief Law with respect to any Notes
Priority Collateral, (ii) so long as the request of adequate protection is in
the form of a replacement Lien on the Revolving Facility Priority Collateral
that is junior to the Liens on the Revolving Facility Priority Collateral
securing the Revolving Facility Priority Obligations, any request by the First
Lien Security Agent or the First Lien Secured Parties for adequate protection
with respect to any Revolving Facility Priority Collateral, or (iii) any
objection by the First Lien Security Agent or the First Lien Secured Parties to
any motion, relief, action or proceeding based on the First Lien Security Agent
or the First Lien Secured Parties claiming a lack of adequate protection with
respect to the Notes Priority Collateral. Notwithstanding the foregoing
provisions in this Section 3.5(c), in any Insolvency or Liquidation Proceeding,
(A) if the First Lien Secured Parties (or any subset thereof) are granted
adequate protection in the form of additional collateral in the nature of assets
constituting Notes Priority Collateral in connection with any First Lien DIP
Financing or use of cash collateral constituting Notes Priority Collateral, then
(x) if any Additional Second Lien Obligations have been issued, each of the
Second Lien Security Agent, on behalf of itself or any of the other Second Lien
Secured Parties, and (y) the Revolving Facility Agent, on behalf of itself or
any of the other Revolving Facility Secured Parties, as the case may be, may
seek or request adequate protection in the form of a Lien on such additional
collateral, which Lien will be subordinated to the Liens securing the First Lien
Obligations and such First Lien DIP Financing (and all obligations relating
thereto) on the same basis as the other Liens on Notes Priority Collateral
securing the Second Lien Obligations or Revolving Facility Obligations, as the
case may be, are so subordinated to the First Lien Obligations under this
Agreement, and (B) in the event (x) if any Additional Second Lien Obligations
have been issued, the Second Lien Security Agent, on behalf of itself and the
other Second Lien Secured Parties and (y) the Revolving Facility Agent, on
behalf of itself and the other Revolving Facility Secured Parties, as the case
may be, seeks or requests adequate protection in respect of Notes Priority
Collateral securing Second Lien Obligations or Revolving Facility Obligations,
as the case may be, and such adequate protection is granted in the form of
additional collateral in the nature of assets

 

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constituting Notes Priority Collateral, then each of the Second Lien Security
Agent, on behalf of itself or any of the other Second Lien Secured Parties and
the Revolving Facility Agent, on behalf of itself or any of the other Revolving
Facility Secured Parties, agrees that the First Lien Security Agent shall also
be granted a senior Lien on such additional collateral as security for the First
Lien Obligations and for any such First Lien DIP Financing and that any Lien on
such additional collateral securing the Second Lien Obligations or the Revolving
Facility Obligations, as the case may be, shall be subordinated to the Liens on
such collateral securing the First Lien Obligations and any such First Lien DIP
Financing (and all obligations relating thereto) and to any other Liens on such
Collateral granted to the First Lien Secured Parties as adequate protection on
the same basis as the other Liens on Notes Priority Collateral securing the
Second Lien Obligations or Revolving Facility Obligations, as the case may be,
are so subordinated to such First Lien Obligations under this Agreement.

(ii) The Revolving Facility Agent, on behalf of itself and the other Revolving
Facility Secured Parties, agrees that, if any Additional Second Lien Obligations
have been issued, none of them shall contest (or support any other Person
contesting) (i) any request by the Second Lien Security Agent or the Second Lien
Secured Parties for adequate protection or similar protection under any Debtor
Relief Law with respect to any Notes Priority Collateral, (ii) so long as the
request of adequate protection is in the form of a replacement Lien on the
Revolving Facility Priority Collateral that is junior to the Liens on the
Revolving Facility Priority Collateral securing the Revolving Facility Priority
Obligations, any request by the Second Lien Security Agent or the Second Lien
Secured Parties for adequate protection with respect to any Revolving Facility
Priority Collateral, or (iii) any objection by the Second Lien Security Agent or
the Second Lien Secured Parties to any motion, relief, action or proceeding
based on the Second Lien Security Agent or the Second Lien Secured Parties
claiming a lack of adequate protection with respect to the Notes Priority
Collateral.

(d) No Waiver.

(i) Subject to the proviso in clause (ii) of Section 3.1(a) and Section 6,
nothing contained herein shall prohibit or in any way limit the First Lien
Security Agent or any First Lien Secured Party from objecting in any Insolvency
or Liquidation Proceeding or otherwise to any action taken by the Revolving
Facility Agent, any of the Revolving Facility Secured Parties, the Second Lien
Security Agent or any of the Second Lien Secured Parties in respect of the Notes
Priority Collateral, including the seeking by the Revolving Facility Agent, any
Revolving Facility Secured Parties, the Second Lien Security Agent or any Second
Lien Secured Party of adequate protection in respect thereof or the asserting by
the Revolving Facility Agent, any Revolving Facility Secured Parties, the Second
Lien Security Agent or any Second Lien Secured Party of any of its rights and
remedies under the Revolving Facility Documents or the Second Lien Security
Documents or otherwise in respect thereof.

(ii) Subject to the proviso in clause (ii) of Section 3.2(a) and Section 6, if
any Additional Second Lien Obligations have been issued, nothing contained
herein shall prohibit or in any way limit the Second Lien Security Agent or any
Second Lien Secured Party from objecting in any Insolvency or Liquidation
Proceeding or otherwise to any action taken by the Revolving Facility Agent, any
of the Revolving Facility Secured Parties in respect of the

 

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Notes Priority Collateral, including the seeking by the Revolving Facility Agent
or any Revolving Facility Secured Parties of adequate protection in respect
thereof or the asserting by the Revolving Facility Agent or any Revolving
Facility Secured Parties of any of its rights and remedies under the Revolving
Facility Documents or otherwise in respect thereof.

(e) Waiver.

(i) Each of the Revolving Facility Agent, for itself and on behalf of the other
Revolving Facility Secured Parties, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent, for itself and on
behalf of the other Second Lien Secured Parties, waives any claim it may
hereafter have against any First Lien Secured Party arising out of the election
of any First Lien Secured Party of the application of Section 1111(b)(2) of the
Bankruptcy Code, and/or out of any cash collateral or financing arrangement or
out of any grant of a security interest, in each case, in connection with the
Notes Priority Collateral in any Insolvency or Liquidation Proceeding.

(ii) The Revolving Facility Agent, for itself and on behalf of the other
Revolving Facility Secured Parties, waives any claim it may hereafter have, if
any Additional Second Lien Obligations have been issued, against any Second Lien
Secured Party arising out of the election of any Second Lien Secured Party of
the application of Section 1111(b)(2) of the Bankruptcy Code, and/or out of any
cash collateral or financing arrangement or out of any grant of a security
interest, in each case, in connection with the Notes Priority Collateral in any
Insolvency or Liquidation Proceeding.

3.6. Reliance; Waivers; Etc.

(a) Reliance.

(i) Other than any reliance on the terms of this Agreement, each of the
Revolving Facility Agent, on behalf of itself and the other Revolving Facility
Secured Parties, and, if any Additional Second Lien Obligations have been
issued, the Second Lien Security Agent, on behalf of itself and the other Second
Lien Secured Parties, acknowledges that it and such Revolving Facility Secured
Parties or such Second Lien Secured Parties, as the case may be, have,
independently and without reliance on the First Lien Security Agent or any First
Lien Secured Parties, and based on documents and information deemed by them
appropriate, made their own credit analysis and decision to enter into the
Revolving Facility Documents and Second Lien Documents, as the case may be, and
be bound by the terms of this Agreement and they will continue to make their own
credit decision in taking or not taking any action under the Revolving Facility
Credit Agreement or any Additional Second Lien Obligations Agreement, as the
case may be, or this Agreement.

(ii) Other than any reliance on the terms of this Agreement, the Revolving
Facility Agent, on behalf of itself and the other Revolving Facility Secured
Parties, acknowledges that it and such Revolving Facility Secured Parties have,
independently and without reliance on the Second Lien Security Agent or any
Second Lien Secured Parties, and based on documents and information deemed by
them appropriate, made their own credit analysis and decision to enter into the
Revolving Facility Documents and be bound by the terms of this Agreement and
they will continue to make their own credit decision in taking or not taking any
action under the Revolving Facility Credit Agreement or this Agreement.

 

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(b) No Warranties or Liability.

(i) Each of the Revolving Facility Agent, on behalf of itself and the other
Revolving Facility Secured Parties, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent, on behalf of
itself and the other Second Lien Secured Parties, acknowledges and agrees that
the First Lien Security Agent and the First Lien Secured Parties have made no
express or implied representation or warranty, including with respect to the
execution, validity, legality, completeness, collectability or enforceability of
any of the First Lien Documents, the ownership of any Collateral or the
perfection or priority of any Liens thereon. The First Lien Secured Parties will
be entitled to manage and supervise their respective loans and extensions of
credit under their respective First Lien Documents in accordance with law and as
they may otherwise, in their sole discretion, deem appropriate. The First Lien
Security Agent and the First Lien Secured Parties shall have no duty to the
Revolving Facility Agent or any of the Revolving Facility Secured Parties, or,
if any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent or any of the Second Lien Secured Parties, to act or refrain from
acting in a manner which allows, or results in, the occurrence or continuance of
an event of default or default under any agreements with the Company or any
Grantor (including the First Lien Documents, the Second Lien Documents and the
Revolving Facility Documents), regardless of any knowledge thereof which they
may have or be charged with.

(ii) Each of the Revolving Facility Agent, on behalf of itself and the other
Revolving Facility Secured Parties, and the First Lien Security Agent, on behalf
of itself and the other First Lien Secured Parties, acknowledges and agrees
that, if any Additional Second Lien Obligations have been issued, the Second
Lien Security Agent and the Second Lien Secured Parties will have made no
express or implied representation or warranty, including with respect to the
execution, validity, legality, completeness, collectability or enforceability of
any of the Second Lien Documents, the ownership of any Collateral or the
perfection or priority of any Liens thereon. The Second Lien Secured Parties
will be entitled to manage and supervise their respective loans and extensions
of credit under their respective Second Lien Documents in accordance with law
and as they may otherwise, in their sole discretion, deem appropriate. The
Second Lien Security Agent and the Second Lien Secured Parties shall have no
duty to the Revolving Facility Agent, any of the Revolving Facility Secured
Parties, the First Lien Security Agent or any of the First Lien Secured Parties
to act or refrain from acting in a manner which allows, or results in, the
occurrence or continuance of an event of default or default under any agreements
with the Company or any Grantor (including the First Lien Documents, the Second
Lien Documents and the Revolving Facility Documents), regardless of any
knowledge thereof which they may have or be charged with.

(c) No Waiver of Lien Priorities – First Lien Obligations.

(i) No right of the First Lien Secured Parties, the First Lien Security Agent or
any of them to enforce any provision of this Agreement or any First Lien
Document shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company

 

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or any other Grantor or by any act or failure to act by any First Lien Secured
Party or the First Lien Security Agent, or by any noncompliance by any Person
with the terms, provisions and covenants of this Agreement, any of the First
Lien Documents, any of the Second Lien Documents or any of the Revolving
Facility Documents, regardless of any knowledge thereof which the First Lien
Security Agent or the First Lien Secured Parties, or any of them, may have or be
otherwise charged with.

(ii) Without in any way limiting the generality of the foregoing paragraph (but
subject to the rights of the Company and the other Grantors under the First Lien
Documents and subject to the provisions of Section 3.5(a) and (c)), the First
Lien Secured Parties, the First Lien Security Agent and any of them may, at any
time and from time to time in accordance with the First Lien Documents and/or
applicable law, without the consent of, or notice to, the Revolving Facility
Agent or any Revolving Facility Secured Party, or, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent or any Second Lien
Secured Party, without incurring any liabilities to the Revolving Facility
Agent, any Revolving Facility Secured Party, the Second Lien Security Agent or
any Second Lien Secured Party and without impairing or releasing the Lien
priorities and other benefits provided in this Agreement (even if any right of
subrogation or other right or remedy of the Revolving Facility Agent, any
Revolving Facility Secured Party, the Second Lien Security Agent or any Second
Lien Secured Party is affected, impaired or extinguished thereby) do any one or
more of the following:

(A) make loans and advances to any Grantor or issue, guaranty or obtain letters
of credit for account of any Grantor or otherwise extend credit to any Grantor,
in any amount and on any terms, whether pursuant to a commitment or as a
discretionary advance and whether or not any default or event of default or
failure of condition is then continuing;

(B) change the manner, place or terms of payment or change or extend the time of
payment of, or amend, renew, exchange, increase or alter, the terms of any of
the First Lien Obligations or any First Lien on any Notes Priority Collateral
or, after the Discharge of Revolving Facility Obligations, any Revolving
Facility Priority Collateral, or guaranty thereof or any liability of any of the
Company or any other Grantor, or any liability incurred directly or indirectly
in respect thereof (including any increase in or extension of the First Lien
Obligations, without any restriction as to the amount, tenor or terms of any
such increase or extension) or otherwise amend, renew, exchange, extend, modify
or supplement in any manner any First Lien on the Notes Priority Collateral, or
after the Discharge of Revolving Facility Obligations, the Revolving Facility
Priority Collateral, held by the First Lien Security Agent or any of the First
Lien Secured Parties, the First Lien Obligations or any of the First Lien
Documents;

(C) sell, exchange, realize upon, enforce or otherwise deal with in any manner
(subject to the terms hereof) and in any order any part of the Notes Priority
Collateral or, after the Discharge of Revolving Facility Obligations, the
Revolving Facility Priority Collateral, or any liability of the Company or any
other Grantor to the First Lien Secured Parties or the First Lien Security
Agent;

 

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(D) settle or compromise any First Lien Obligation or any other liability of the
Company or any other Grantor or any Notes Priority Collateral; and

(E) exercise or delay in or refrain from exercising any right or remedy against
the Company or any other Grantor or any other Person, elect any remedy and
otherwise deal freely with the Company, any other Grantor or any Notes Priority
Collateral or, after the Discharge of Revolving Facility Obligations, the
Revolving Facility Priority Collateral, or any liability incurred directly or
indirectly in respect thereof.

(iii) Each of the Revolving Facility Agent, on behalf of itself and the other
Revolving Facility Secured Parties, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent, on behalf of
itself and the other Second Lien Secured Parties, also agrees that the First
Lien Secured Parties and the First Lien Security Agent shall have no liability
to the Revolving Facility Agent, any Revolving Facility Secured Party, the
Second Lien Security Agent and any Second Lien Secured Party, and the Revolving
Facility Agent, on behalf of itself and each of the other Revolving Facility
Secured Parties, and the Second Lien Security Agent, on behalf of itself and
each of the other Second Lien Secured Parties, hereby waives any claim against
any First Lien Secured Party or the First Lien Security Agent, arising out of
any and all actions which the First Lien Secured Parties or the First Lien
Security Agent may take or permit or omit to take with respect to:

(A) the First Lien Documents (other than this Agreement), including any failure
to perfect or obtain perfected security interests in the Notes Priority
Collateral;

(B) the collection of the Term Loan Obligations; or

(C) the foreclosure upon, or sale, liquidation or other disposition of, any
Notes Priority Collateral or, after Discharge of Revolving Facility Obligations,
the Revolving Facility Priority Collateral.

Except as otherwise required by this Agreement, each of the Revolving Facility
Agent, on behalf of itself and the other Revolving Facility Secured Parties,
and, if any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent, on behalf of itself and the other Second Lien Secured Parties,
agrees that the First Lien Secured Parties and the First Lien Security Agent
have no duty to the Revolving Facility Agent. the Revolving Facility Secured
Parties, the Second Lien Security Agent or the Second Lien Secured Parties in
respect of the maintenance or preservation of the Notes Priority Collateral, or,
after the Discharge of Revolving Facility Obligations, the Revolving Facility
Priority Collateral, the First Lien Obligations or otherwise.

(iv) Each of the Revolving Facility Agent, on behalf of itself and the other
Revolving Facility Secured Parties, and prior to the Discharge of First Lien
Obligations, if any Additional Second Lien Obligations have been issued, the
Second Lien Security Agent, on behalf of itself and the other Second Lien
Secured Parties, agrees not to assert and hereby waives, to the fullest extent
permitted by law, any right to demand, request, plead or otherwise

 

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assert or otherwise claim the benefit of, any marshalling, appraisal, valuation
or other similar right that may otherwise be available under applicable law with
respect to the Notes Priority Collateral or, after the Discharge of Revolving
Facility Obligations, the Revolving Facility Priority Collateral, or any other
similar rights a junior secured creditor may have under applicable law.

(d) No Waiver of Lien Priorities – Second Lien Obligations. If any Additional
Second Lien Obligations have been issued:

(i) no right of the Second Lien Secured Parties, the Second Lien Security Agent
or any of them to enforce any provision of this Agreement or any Second Lien
Document shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or any other Grantor or by any act or
failure to act by any Second Lien Secured Party or the Second Lien Security
Agent, or by any noncompliance by any Person with the terms, provisions and
covenants of this Agreement, any of the First Lien Documents, any of the Second
Lien Documents or any of the Revolving Facility Documents, regardless of any
knowledge thereof which the Second Lien Security Agent or the Second Lien
Secured Parties, or any of them, may have or be otherwise charged with.

(ii) After the Discharge of First Lien Obligations has occurred, without in any
way limiting the generality of the foregoing paragraph (but subject to the
rights of the Company and the other Grantors under the Second Lien Documents and
subject to the provisions of Section 3.4(f) and Section 3.5(c)), the Second Lien
Secured Parties, the Second Lien Security Agent and any of them may, at any time
and from time to time in accordance with the Second Lien Documents and/or
applicable law, without the consent of, or notice to, the Revolving Facility
Agent, any Revolving Facility Secured Party, the First Lien Security Agent or
any First Lien Secured Party, without incurring any liabilities to the Revolving
Facility Agent, any Revolving Facility Secured Party, the First Lien Security
Agent or any First Lien Secured Party and without impairing or releasing the
Lien priorities and other benefits provided in this Agreement (even if any right
of subrogation or other right or remedy of the Revolving Facility Agent, any
Revolving Facility Secured Party is affected, impaired or extinguished thereby)
do any one or more of the following:

(A) make loans and advances to any Grantor or issue, guaranty or obtain letters
of credit for account of any Grantor or otherwise extend credit to any Grantor,
in any amount and on any terms, whether pursuant to a commitment or as a
discretionary advance and whether or not any default or event of default or
failure of condition is then continuing;

(B) change the manner, place or terms of payment or change or extend the time of
payment of, or amend, renew, exchange, increase or alter, the terms of any of
the Second Lien Obligations or any Second Lien on any Notes Priority Collateral
or guaranty thereof or any liability of any of the Company or any other Grantor,
or any liability incurred directly or indirectly in respect thereof (including
any increase in or extension of the Second Lien Obligations, without any
restriction as to the amount, tenor or terms of any such increase or extension)
or otherwise amend, renew, exchange, extend,

 

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modify or supplement in any manner any Second Lien on the Notes Priority
Collateral held by the Second Lien Security Agent or any of the Second Lien
Secured Parties, the Second Lien Obligations or any of the Second Lien
Documents;

(C) sell, exchange, realize upon, enforce or otherwise deal with in any manner
(subject to the terms hereof) and in any order any part of the Notes Priority
Collateral or any liability of the Company or any other Grantor to the Second
Lien Secured Parties or the Second Lien Security Agent;

(D) settle or compromise any Second Lien Obligation or any other liability of
the Company or any other Grantor or any Notes Priority Collateral; and

(E) exercise or delay in or refrain from exercising any right or remedy against
the Company or any other Grantor or any other Person, elect any remedy and
otherwise deal freely with the Company, any other Grantor or any Notes Priority
Collateral or any liability incurred directly or indirectly in respect thereof.

(iii) The Revolving Facility Agent, on behalf of itself and the other Revolving
Facility Secured Parties also agrees that the Second Lien Secured Parties and
the Second Lien Security Agent shall have no liability to the Revolving Facility
Agent or any Revolving Facility Secured Party and the Revolving Facility Agent,
on behalf of itself and each of the other Revolving Facility Secured Parties
hereby waives any claim against any Second Lien Secured Party or the Second Lien
Security Agent, arising out of any and all actions which the Second Lien Secured
Parties or the Second Lien Security Agent may take or permit or omit to take
with respect to:

(A) the Second Lien Documents (other than this Agreement), including any failure
to perfect or obtain perfected security interests in the Notes Priority
Collateral;

(B) the collection of the Second Lien Obligations; or

(C) the foreclosure upon, or sale, liquidation or other disposition of, any
Notes Priority Collateral.

Except as otherwise required by this Agreement, the Revolving Facility Agent, on
behalf of itself and the other Revolving Facility Secured Parties agrees that
the Second Lien Secured Parties and the Second Lien Security Agent have no duty
to the Revolving Facility Agent or the Revolving Facility Secured Parties in
respect of the maintenance or preservation of the Notes Priority Collateral, the
Second Lien Obligations or otherwise.

(iv) The Revolving Facility Agent, on behalf of itself and the other Revolving
Facility Secured Parties agrees not to assert and hereby waives, to the fullest
extent permitted by law, any right to demand, request, plead or otherwise assert
or otherwise claim the benefit of, any marshalling, appraisal, valuation or
other similar right that may otherwise be available under applicable law with
respect to the Notes Priority Collateral or any other similar rights a junior
secured creditor may have under applicable law.

 

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Section 4. Revolving Facility Priority Collateral.

4.1. Exercise of Remedies – Prior to Discharge of Revolving Facility
Obligations.

(a) So long as the Discharge of Revolving Facility Obligations has not occurred,
whether or not any Insolvency or Liquidation Proceeding has been commenced by or
against the Company or any other Grantor:

(i) none of the First Lien Security Agent, any of the other First Lien Secured
Parties, or, if any Additional Second Lien Obligations have been issued, the
Second Lien Security Agent or any of the other Second Lien Secured Parties
(x) will exercise or seek to exercise any rights or remedies (including setoff)
with respect to any Revolving Facility Priority Collateral (including the
exercise of any right under any lockbox agreement, account control agreement,
landlord waiver or bailee’s letter or similar agreement or arrangement in
respect of Revolving Facility Priority Collateral to which the First Lien
Security Agent, any other First Lien Secured Party, the Second Lien Security
Agent or any other Second Lien Secured Party is a party) or institute or
commence, or join with any Person (other than the Revolving Facility Agent and
the other Revolving Facility Secured Parties) in commencing any action or
proceeding with respect to such rights or remedies (including any action of
foreclosure, enforcement, collection or execution); provided, however, that
(A) the Directing First Lien Security Agent may exercise any or all such rights
in accordance with the First Lien Documents after the passage of a period of 180
days has elapsed since the date of delivery of a notice in writing to the
Revolving Facility Agent with respect to any of the following (and requesting
that enforcement actions be taken with respect to the Revolving Facility
Priority Collateral) and so long as the respective payment default shall not
have been cured or waived (or the respective acceleration rescinded): (i) a
payment default exists with respect to the First Lien Obligations following the
final maturity of the First Lien Obligations or (ii) after the acceleration by
the relevant First Lien Secured Parties of the maturity of all then outstanding
First Lien Obligations (the “First Lien Standstill Period”); and (B) if any
Additional Second Lien Obligations have been issued, the Directing Second Lien
Security Agent may exercise any or all such rights in accordance with the Second
Lien Documents after the passage of a period of 180 days has elapsed since the
date of delivery of a notice in writing to the Revolving Facility Agent with
respect to any of the following (and requesting that enforcement actions be
taken with respect to the Revolving Facility Priority Collateral) and so long as
the respective payment default shall not have been cured or waived (or the
respective acceleration rescinded): (i) a payment default exists with respect to
the Second Lien Obligations following the final maturity of the Second Lien
Obligations or (ii) after the acceleration by the relevant Second Lien Secured
Parties of the maturity of all then outstanding Second Lien Obligations (the
“Second Lien Revolving Facility Priority Collateral Standstill Period”);
provided, further, however, notwithstanding anything herein to the contrary,
none of the First Lien Security Agent, any other First Lien Secured Party, the
Second Lien Security Agent or any other Second Lien Secured Party will exercise
any rights or remedies with respect to any Revolving Facility Priority
Collateral if, notwithstanding the expiration of the First Lien Standstill
Period and/or the Second Lien Revolving Facility Priority Collateral Standstill
Period, as the case may be, the Revolving Facility Agent or Revolving Facility
Secured Parties shall have commenced and be diligently pursuing in good faith
the exercise of any of their rights or remedies with respect to the Revolving
Facility Priority Collateral (prompt

 

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notice of such exercise to be given by the Revolving Facility Agent to the
Directing First Lien Security Agent and Directing Second Lien Security Agent),
(y) will contest, protest or object to any foreclosure proceeding or action
brought by the Revolving Facility Agent or any other Revolving Facility Secured
Party with respect to, or any other exercise by the Revolving Facility Agent or
any other Revolving Facility Secured Party of any rights and remedies relating
to, the Revolving Facility Priority Collateral under the Revolving Facility
Documents or otherwise, and (z) subject to its rights under clause (i)(x) above,
will object to the forbearance by the Revolving Facility Agent or the other
Revolving Facility Secured Parties from bringing or pursuing any foreclosure
proceeding or action or any other exercise of any rights or remedies relating to
the Revolving Facility Priority Collateral, in each case so long as the
respective interests of the First Lien Secured Parties and the Second Lien
Secured Parties attach to the Proceeds thereof subject to the relative
priorities described in Section 2; provided, however, that nothing in this
Section 4.1(a) shall be construed to authorize the First Lien Security Agent,
any other First Lien Secured Party, the Second Lien Security Agent or any other
Second Lien Secured Party to sell any Revolving Facility Priority Collateral
free of the Lien of the Revolving Facility Agent or any other Revolving Facility
Secured Party; and

(ii) subject to Section 6 and clause (i)(x) above, the Revolving Facility Agent
and the other Revolving Facility Secured Parties shall have the exclusive right
to enforce rights, exercise remedies (including set off and applicable credit
bid rights) and make determinations regarding the disposition of, or
restrictions with respect to, the Revolving Facility Priority Collateral without
any consultation with or the consent of the First Lien Security Agent, any other
First Lien Secured Party, and, if any Additional Second Lien Obligations have
been issued, the Second Lien Security Agent or any other Second Lien Secured
Party; provided, that:

(A) in any Insolvency or Liquidation Proceeding commenced by or against the
Company or any other Grantor, the First Lien Security Agent, any First Lien
Secured Party, the Second Lien Security Agent or any Second Lien Secured Party
may file a claim or statement of interest with respect to the First Lien
Obligations or Second Lien Obligations, as applicable;

(B) any of the First Lien Security Agent, any other First Lien Secured Party,
the Second Lien Security Agent and any other Second Lien Secured Party may take
any action (not adverse to the priority status of the Liens on the Revolving
Facility Priority Collateral securing the Revolving Facility Obligations, or the
rights of the Revolving Facility Agent or the other Revolving Facility Secured
Parties to exercise remedies in respect thereof) in accordance with the First
Lien Documents or the Second Lien Documents, as applicable, and the terms of
this Agreement in order to preserve or protect its Lien on the Revolving
Facility Priority Collateral;

(C) the First Lien Secured Parties and the Second Lien Secured Parties shall be
entitled to file any necessary responsive or defensive pleadings in opposition
to any motion, claim, adversary proceeding or other pleading made by any Person
objecting to or otherwise seeking the disallowance of the claims of the First
Lien Secured Parties or the Second Lien Secured Parties, including any claims
secured by the Revolving Facility Priority Collateral, if any, in each case in
accordance with the terms of this Agreement;

 

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(D) the First Lien Secured Parties and the Second Lien Secured Parties shall be
entitled to file any pleadings, objections, motions or agreements which assert
rights or interests available to unsecured creditors of the Grantors arising
under either Debtor Relief Laws or applicable non-bankruptcy law, in each case
in accordance with the terms of this Agreement and to the extent not prohibited
by any other provision of this Agreement;

(E) each of the First Lien Secured Parties and the Second Lien Secured Parties
shall be entitled to vote on any plan of reorganization and file any proof of
claim in an Insolvency or Liquidation Proceeding or otherwise and other filings
and make any arguments and motions that are, in each case, in accordance with
the terms of this Agreement, with respect to the Revolving Facility Priority
Collateral;

(F) the First Lien Security Agent or any First Lien Secured Party may exercise
any of its rights or remedies with respect to the Revolving Facility Priority
Collateral in accordance with the First Lien Documents after the termination of
the First Lien Standstill Period to the extent permitted by clause (i)(x) above;
and

(G) the Second Lien Security Agent or any Second Lien Secured Party may exercise
any of its rights or remedies with respect to the Revolving Facility Priority
Collateral in accordance with the Second Lien Documents after the termination of
the Second Lien Revolving Facility Priority Collateral Standstill Period to the
extent permitted by clause (i)(x) above.

Subject to Section 6 and clause (i)(x) above, in exercising rights and remedies
with respect to the Revolving Facility Priority Collateral, the Revolving
Facility Agent and the other Revolving Facility Secured Parties may enforce the
provisions of the Revolving Facility Documents and exercise remedies thereunder,
all in such order and in such manner as they may determine in the exercise of
their sole discretion. Such exercise and enforcement shall include the rights of
an agent appointed by them to sell or otherwise dispose of Revolving Facility
Priority Collateral upon foreclosure, to incur expenses in connection with such
sale or disposition, and to exercise all the rights and remedies of a secured
creditor under the UCC of any applicable jurisdiction and of a secured creditor
under any other applicable law.

(b) Each of the First Lien Security Agent, on behalf of itself and the other
First Lien Secured Parties, and, if any Additional Second Lien Obligations have
been issued, the Second Lien Security Agent, on behalf of itself and the other
Second Lien Secured Parties, agrees that it will not take or receive any
Revolving Facility Priority Collateral or any Proceeds of Revolving Facility
Priority Collateral in connection with the exercise of any right or remedy
(including setoff) with respect to any Revolving Facility Priority Collateral
unless and until the Discharge of Revolving Facility Obligations has occurred,
except as expressly provided in the first proviso in clause (i)(x) of
Section 4.1(a) or in the proviso in clause (ii) of Section 4.1(a) (but subject
to the payment over requirements of Section 4.3). Without limiting the
generality of the foregoing, unless and until the Discharge of Revolving
Facility Obligations has occurred, except as expressly provided in the first
proviso in clause (i)(x) of Section 4.1(a) or in the proviso in clause (ii) of
Section 4.1(a), the sole right of the First Lien Security Agent and the other
First Lien Secured Parties and the Second Lien Security Agent and the

 

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other Second Lien Secured Parties, as the case may be, with respect to the
Revolving Facility Priority Collateral is to hold a Lien on the Revolving
Facility Priority Collateral pursuant to the First Lien Documents or the Second
Lien Documents, as the case may be, for the period and to the extent granted
therein and to receive a share of the Proceeds thereof, if any, after the
Discharge of Revolving Facility Obligations has occurred in accordance with the
terms hereof, the First Lien Documents and applicable law.

(c) Subject to the first proviso in clause (i)(x) of Section 4.1(a), the proviso
in clause (ii) of Section 4.1(a) and Section 6:

(i) each of the First Lien Security Agent, for itself and on behalf of the other
First Lien Secured Parties, and, if any Additional Second Lien Obligations have
been issued, the Second Lien Security Agent, for itself and on behalf of the
other Second Lien Secured Parties, agrees that it will not take any action that
would hinder, delay, limit or prohibit any exercise of remedies under the
Revolving Facility Documents with respect to the Revolving Facility Priority
Collateral, including any collection, sale, lease, exchange, transfer or other
disposition of the Revolving Facility Priority Collateral, whether by
foreclosure or otherwise, or that would limit, invalidate, avoid or set aside
any Lien or Revolving Facility Security Document, in each case, with respect to
the Revolving Facility Priority Collateral or subordinate the priority of the
Revolving Facility Obligations to the First Lien Obligations or the Second Lien
Obligations, as the case may be, with respect to the Revolving Facility Priority
Collateral or grant the Liens with respect to the Revolving Facility Priority
Collateral securing the First Lien Obligations or the Second Lien Obligations,
as the case may be, equal ranking to the Liens with respect to the Revolving
Facility Priority Collateral securing the Revolving Facility Obligations, and

(ii) each of the First Lien Security Agent, for itself and on behalf of the
other First Lien Secured Parties, and, if any Additional Second Lien Obligations
have been issued, the Second Lien Security Agent, for itself and on behalf of
the other Second Lien Secured Parties, hereby waives any and all rights it or
the First Lien Secured Parties or the Second Lien Secured Parties, as the case
may be, may have as a junior Lien creditor with respect to the Revolving
Facility Priority Collateral or otherwise to object to the manner in which the
Revolving Facility Agent or the Revolving Facility Secured Parties seek to
enforce or collect the Revolving Facility Obligations or the Liens granted in
any of the Revolving Facility Priority Collateral, in any such case except to
the extent such enforcement or collection is in violation of the terms of this
Agreement, regardless of whether any action or failure to act by or on behalf of
the Revolving Facility Agent or other Revolving Facility Secured Parties is
adverse to the interest of the First Lien Secured Parties or the Second Lien
Secured Parties, as the case may be.

(d) Each of the First Lien Security Agent, for itself and on behalf of the other
First Lien Secured Parties, and, if any Additional Second Lien Obligations have
been issued, the Second Lien Security Agent, for itself and on behalf of the
other Second Lien Secured Parties, hereby acknowledges and agrees that no
covenant, agreement or restriction contained in any First Lien Document or
Second Lien Document, as applicable (other than this Agreement), shall be deemed
to restrict in any way the rights and remedies of the Revolving Facility Agent
or the Revolving Facility Secured Parties with respect to the Revolving Facility
Priority Collateral as set forth in this Agreement and the Revolving Facility
Documents.

 

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4.2. Exercise of Remedies – After Discharge of Revolving Facility Obligations.

(a) After the Discharge of Revolving Facility Obligations has occurred and so
long as the Discharge of First Lien Obligations has not occurred and if any
Additional Second Lien Obligations have been issued, whether or not any
Insolvency or Liquidation Proceeding has been commenced by or against the
Company or any other Grantor:

(i) neither the Second Lien Security Agent nor any of the other Second Lien
Secured Parties (x) will exercise or seek to exercise any rights or remedies
(including setoff) with respect to any Revolving Facility Priority Collateral
(including the exercise of any right under any lockbox agreement, account
control agreement, landlord waiver or bailee’s letter or similar agreement or
arrangement in respect of Revolving Facility Priority Collateral to which the
Second Lien Security Agent or any other Second Lien Secured Party is a party) or
institute or commence or join with any Person (other than the First Lien
Security Agent and the other First Lien Secured Parties) in commencing any
action or proceeding with respect to such rights or remedies (including any
action of foreclosure, enforcement, collection or execution); provided, however,
that the Directing Second Lien Security Agent may exercise any or all such
rights in accordance with the Second Lien Documents after the passage of a
period of 180 days has elapsed since the date of delivery of a notice in writing
to the Directing First Lien Security Agent with respect to any of the following
(and requesting that enforcement actions be taken with respect to the Revolving
Facility Priority Collateral) and so long as the respective payment default
shall not have been cured or waived (or the respective acceleration rescinded):
(i) a payment default exists with respect to the Second Lien Obligations
following the final maturity of the Second Lien Obligations or (ii) after the
acceleration by the relevant Second Lien Secured Parties of the maturity of all
then outstanding Second Lien Obligations (the “Second Lien/First Lien Revolving
Facility Priority Collateral Standstill Period”); provided, further, however,
notwithstanding anything herein to the contrary, neither the Second Lien
Security Agent nor any other Second Lien Secured Party will exercise any rights
or remedies with respect to any Revolving Facility Priority Collateral if,
notwithstanding the expiration of the Second Lien/First Lien Revolving Facility
Priority Collateral Standstill Period, the Directing First Lien Security Agent
or any other First Lien Secured Party shall have commenced and be diligently
pursuing in good faith the exercise of any of their rights or remedies with
respect to the Revolving Facility Priority Collateral (prompt notice of such
exercise to be given by the Directing First Lien Security Agent to the Directing
Second Lien Security Agent), (y) will contest, protest or object to any
foreclosure proceeding or action brought by the Directing First Lien Security
Agent or any other First Lien Secured Party with respect to, or any other
exercise by the Directing First Lien Security Agent or any other First Lien
Secured Party of any rights and remedies relating to, the Revolving Facility
Priority Collateral under the First Lien Documents or otherwise, and (z) subject
to its rights under the first proviso in clause (i)(x) above, will object to the
forbearance by the Directing First Lien Security Agent or any other First Lien
Secured Party from bringing or pursuing any foreclosure proceeding or action or
any other exercise of any rights or remedies relating to the Revolving Facility
Priority Collateral, in each case so long as the respective interests of the
Second Lien Secured Parties attach to the Proceeds thereof subject to the
relative

 

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priorities described in Section 2; provided, however, that nothing in this
Section 4.2(a) shall be construed to authorize the Second Lien Security Agent or
any Second Lien Secured Party to sell or appropriate any Revolving Facility
Priority Collateral free of the Lien of the First Lien Security Agent or any
First Lien Secured Party; and

(ii) except as may be permitted in accordance with clause (i)(x) above, the
Directing First Lien Security Agent and the First Lien Secured Parties shall
have the exclusive right to enforce rights, exercise remedies (including set off
and credit bid rights) and make determinations regarding the disposition of, or
restrictions with respect to, the Revolving Facility Priority Collateral without
any consultation with or the consent of the Second Lien Security Agent or any
other Second Lien Secured Party; provided, that:

(A) in any Insolvency or Liquidation Proceeding commenced by or against the
Company or any other Grantor, the Second Lien Security Agent and any other
Second Lien Secured Party may file a claim or statement of interest with respect
to the Second Lien Obligations;

(B) the Second Lien Security Agent and any other Second Lien Secured Party may
take any action (not adverse to the priority status of the Liens on the
Revolving Facility Priority Collateral securing the First Lien Obligations, or
the rights of any First Lien Security Agent or the other First Lien Secured
Parties to exercise remedies in respect thereof) in accordance with the Second
Lien Documents and the terms of this Agreement in order to preserve or protect
its Lien on or over the Revolving Facility Priority Collateral;

(C) the Second Lien Secured Parties shall be entitled to file any necessary
responsive or defensive pleadings in opposition to any motion, claim, adversary
proceeding or other pleading made by any Person objecting to or otherwise
seeking the disallowance of the claims of the Second Lien Secured Parties,
including any claims secured by the Revolving Facility Priority Collateral, if
any, in each case in accordance with the terms of this Agreement;

(D) the Second Lien Secured Parties shall be entitled to file any pleadings,
objections, motions or agreements which assert rights or interests available to
unsecured creditors of the Grantors arising under either Debtor Relief Laws or
applicable non-bankruptcy law, in each case in accordance with the terms of this
Agreement and to the extent not prohibited by any other provision of this
Agreement;

(E) the Second Lien Secured Parties shall be entitled to vote on any plan of
reorganization and file any proof of claim in an Insolvency or Liquidation
Proceeding or otherwise and other filings and make any arguments and motions
that are, in each case, in accordance with the terms of this Agreement, with
respect to the Revolving Facility Priority Collateral; and

(F) the Second Lien Security Agent or any Second Lien Secured Party may exercise
any of its rights or remedies with respect to the Revolving Facility Priority
Collateral in accordance with the Second Lien Documents after the termination of
the First Lien/Second Lien Revolving Facility Priority Collateral Standstill
Period to the extent permitted by clause (i)(x) above.

 

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Except as may be permitted in accordance with clause (i)(x) above, in exercising
rights and remedies with respect to the Revolving Facility Priority Collateral,
following the Discharge of Revolving Facility Obligations, the Directing First
Lien Security Agent and the other First Lien Secured Parties may enforce the
provisions of the First Lien Documents and exercise remedies thereunder, all in
such order and in such manner as they may determine in the exercise of their
sole discretion subject to applicable law and the terms of the First Lien
Documents, including the rights of an agent appointed by them to sell or
otherwise dispose of Revolving Facility Priority Collateral upon foreclosure, to
incur expenses in connection with such sale or disposition, and to exercise all
the rights and remedies of a secured creditor under the UCC of any applicable
jurisdiction and of a secured creditor under any other applicable law.

(b) After the Discharge of Revolving Facility Obligations has occurred and so
long as the Discharge of First Lien Obligations has not occurred, if any
Additional Second Lien Obligations have been issued, the Second Lien Security
Agent, on behalf of itself and the other Second Lien Secured Parties, agrees
that it will not take or receive any Revolving Facility Priority Collateral or
any Proceeds of Revolving Facility Priority Collateral in connection with the
exercise of any right or remedy (including setoff) with respect to any Revolving
Facility Priority Collateral, except as expressly provided in the first proviso
in clause (i)(x) of Section 4.2(a) or in the proviso in clause (ii) of
Section 4.2(a) (but subject to the payment over provisions of Section 4.3).
Without limiting the generality of the foregoing, unless and until the Discharge
of First Lien Obligations has occurred, except as expressly provided in the
first proviso in clause (i)(x) of Section 4.2(a) or in the proviso in clause
(ii) of Section 4.2(a), the sole right of the Second Lien Security Agent and the
Second Lien Secured Parties with respect to the Revolving Facility Priority
Collateral is to hold a Lien on the Revolving Facility Priority Collateral
pursuant to the Second Lien Documents for the period and to the extent granted
therein and to receive a share of the Proceeds thereof, if any, after the
Discharge of Revolving Facility Obligations and the Discharge of First Lien
Obligations has occurred in accordance with the terms hereof, the Second Lien
Documents and applicable law.

(c) After the Discharge of Revolving Facility Obligations has occurred and so
long as the Discharge of First Lien Obligation has not occurred, if any
Additional Second Lien Obligations have been issued, the Second Lien Security
Agent, subject to the first proviso in clause (i)(x) of Section 4.2(a) and the
proviso in clause (ii) of Section 4.2 (a):

(i) the Second Lien Security Agent, for itself and on behalf of the other Second
Lien Secured Parties, agrees that the Second Lien Security Agent and the Second
Lien Secured Parties will not take any action that would hinder, delay, limit or
prohibit any exercise of remedies under the First Lien Documents with respect to
the Revolving Facility Priority Collateral, including any collection, sale,
lease, exchange, transfer or other disposition of the Revolving Facility
Priority Collateral, whether by foreclosure or otherwise, or that would limit,
invalidate, avoid or set aside any Lien or First Lien Security Document with
respect to the Revolving Facility Priority Collateral or subordinate the
priority of the First Lien Obligations to the Second Lien Obligations with
respect to the Revolving Facility Priority Collateral or grant the Liens with
respect to the Revolving Facility Priority Collateral securing the Second Lien
Obligations equal ranking to the Liens with respect to the Revolving Facility
Priority Collateral securing the First Lien Obligations, and

 

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(ii) the Second Lien Security Agent, for itself and on behalf of the other
Second Lien Secured Parties, hereby waives any and all rights it or the other
Second Lien Secured Parties may have as a junior Lien creditor with respect to
the Revolving Facility Priority Collateral or otherwise to object to the manner
in which the First Lien Security Agent or the other First Lien Secured Parties
seek to enforce or collect the First Lien Obligations or the Liens granted in
any of the Revolving Facility Priority Collateral, in any such case except to
the extent such enforcement or collection is in violation of the terms of this
Agreement, regardless of whether any action or failure to act by or on behalf of
the First Lien Security Agent or First Lien Secured Parties is adverse to the
interest of the Second Lien Secured Parties.

(d) If any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent hereby acknowledges and agrees that no covenant, agreement or
restriction contained in any Second Lien Document (other than this Agreement)
shall be deemed to restrict in any way the rights and remedies of the First Lien
Security Agent or the First Lien Secured Parties with respect to the Revolving
Facility Priority Collateral as set forth in this Agreement and the First Lien
Documents.

4.3. Payments Over.

(a) Prior to Discharge of Revolving Facility Obligations. So long as the
Discharge of Revolving Facility Obligations has not occurred, any Revolving
Facility Priority Collateral and Proceeds thereof received by (i) the First Lien
Security Agent or any First Lien Secured Parties or (ii) if any Additional
Second Lien Obligations have been issued, the Second Lien Security Agent or any
Second Lien Secured Parties in connection with the exercise of any right or
remedy (including set off) relating to the Revolving Facility Priority
Collateral (including following the expiration of the First Lien Standstill
Period or the Second Lien Revolving Facility Priority Collateral Standstill
Period) or otherwise that is inconsistent with this Agreement shall be
segregated and held in trust and forthwith paid over to the Revolving Facility
Agent, for the benefit of the Revolving Facility Secured Parties, for
application in accordance with Section 7.2 below, in the same form as received,
with any necessary endorsements or as a court of competent jurisdiction may
otherwise direct. The Revolving Facility Agent is hereby authorized to make any
such endorsements as agent for the Directing First Lien Security Agent, any such
First Lien Secured Parties, the Directing Second Lien Security Agent and any
such Second Lien Secured Parties. This authorization is coupled with an interest
and is irrevocable until the Discharge of Revolving Facility Obligations.

(b) After Discharge of Revolving Facility Obligations. After the Discharge of
Revolving Facility Obligations has occurred and so long as the Discharge of
First Lien Obligations has not occurred, any Revolving Facility Priority
Collateral and Proceeds thereof received by (i) if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent or any Second Lien
Secured Parties or (ii) any First Lien Security Agent or any other First Lien
Secured Party in connection with the exercise of any right or remedy (including
set off) relating to the Revolving Facility Priority Collateral (including
following the expiration

 

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of the Second Lien/First Lien Revolving Priority Collateral Standstill Period)
or otherwise that is inconsistent with this Agreement shall be segregated and
held in trust and forthwith paid over to the Directing First Lien Security
Agent, for the benefit of the First Lien Secured Parties, for application in
accordance with Section 7.1 below, in the same form as received, with any
necessary endorsements or as a court of competent jurisdiction may otherwise
direct. The Directing First Lien Security Agent is hereby authorized to make any
such endorsements as agent for the Directing Second Lien Security Agent, any
such Second Lien Secured Parties, the other First Lien Security Agents and the
other First Lien Secured Parties. This authorization is coupled with an interest
and is irrevocable until the Discharge of First Lien Obligations.

4.4. Other Agreements.

(a) Releases – Revolving Facility Obligations.

(i) If, in connection with:

(A) the exercise of the Revolving Facility Agent’s remedies in respect of the
Revolving Facility Priority Collateral provided for in Section 4.1(a) (with the
Proceeds thereof being applied to the Revolving Facility Priority Obligations),
including any sale, lease, exchange, transfer or other disposition of any such
Revolving Facility Priority Collateral; or

(B) any sale, lease, exchange, transfer or other disposition of any Revolving
Facility Priority Collateral permitted under the terms of the Revolving Facility
Documents (other than in connection with the Discharge of Revolving Facility
Obligations and subject to this Agreement),

the Revolving Facility Agent, for itself or on behalf of any of the other
Revolving Facility Secured Parties, releases any of its Liens on any part of the
Revolving Facility Priority Collateral, then the Liens, if any, of the (x) First
Lien Security Agent, for itself or for the benefit of the other First Lien
Secured Parties, and (y) if any Additional Second Lien Obligations have been
issued, the Second Lien Security Agent, for itself or for the benefit of the
other Second Lien Secured Parties, on such Revolving Facility Priority
Collateral (but not, in each case, the Proceeds thereof (until applied to the
Revolving Facility Obligations), which shall be subject to the priorities set
forth in this Agreement) shall be automatically, unconditionally and
simultaneously released and the Revolving Facility Agent is irrevocably
authorized to execute and deliver or enter into any release of such Liens or
claims that may, in the discretion of the Revolving Facility Agent, be necessary
or reasonably desirable in connection with such releases, and (A) the First Lien
Security Agent, for itself and on behalf of the other First Lien Secured
Parties, and (B) if any Additional Second Lien Obligations have been issued, the
Second Lien Security Agent, for itself and on behalf of the other Second Lien
Secured Parties, promptly shall execute and deliver to the Revolving Facility
Agent or such Grantor (at the expense of such Grantor) such termination
statements, releases and other documents as the Revolving Facility Agent or such
Grantor may request to effectively confirm such release.

(ii) Until the Discharge of Revolving Facility Obligations occurs, each of
(x) the First Lien Security Agent, for itself and on behalf of the other First
Lien Secured Parties and

 

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(y) if any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent, for itself and on behalf of the other Second Lien Secured
Parties, hereby irrevocably constitutes and appoints the Revolving Facility
Agent and any officer or agent of the Revolving Facility Agent, with full power
of substitution, as its true and lawful attorney in fact with full irrevocable
power and authority in the place and stead of the First Lien Security Agent, the
Second Lien Security Agent or such Secured Party, as the case may be, or in the
Revolving Facility Agent’s own name, from time to time in the Revolving Facility
Agent’s discretion, for the purpose of carrying out the terms of this
Section 4.4(a) with respect to Revolving Facility Priority Collateral, to take
any and all appropriate action and to execute any and all documents and
instruments which may be necessary to accomplish the purposes of this
Section 4.4(a) with respect to Revolving Facility Priority Collateral, including
any endorsements or other instruments of transfer or release.

(iii) Until the Discharge of Revolving Facility Obligations occurs, to the
extent that the Revolving Facility Secured Parties (a) have released any Lien on
Revolving Facility Priority Collateral and any such Lien is later reinstated or
(b) obtain any new First Priority Liens on assets constituting Revolving
Facility Priority Collateral from Grantors, then (x) the First Lien Secured
Parties shall be granted a Second Priority Lien on any such Revolving Facility
Priority Collateral and (y) if any Additional Second Lien Obligations have been
issued, the Second Lien Secured Parties shall be granted a Third Priority Lien
(or, after the Discharge of First Lien Obligations, a Second Priority Lien), on
any such Revolving Facility Priority Collateral.

(b) Releases – First Lien Obligations.

(i) After the Discharge of Revolving Facility Obligations has occurred and so
long as the Discharge of First Lien Obligations has not occurred and if any
Additional Second Lien Obligations have been issued, then if, in connection
with:

(A) the exercise of any Directing First Lien Security Agent’s remedies in
respect of the Revolving Facility Priority Collateral provided for in
Section 4.2(a) (with the Proceeds thereof being applied to the First Lien
Priority Obligations), including any sale, lease, exchange, transfer or other
disposition of any such Revolving Facility Priority Collateral; or

(B) any sale, lease, exchange, transfer or other disposition of any Revolving
Facility Priority Collateral permitted under the terms of the First Lien
Documents (other than in connection with the Discharge of First Lien Obligations
and subject to this Agreement),

the Directing First Lien Security Agent, for itself or on behalf of any of the
other First Lien Secured Parties, releases any of its Liens on any part of the
Revolving Facility Priority Collateral, then the Liens, if any, of the Second
Lien Security Agent, for itself or for the benefit of the other Second Lien
Secured Parties, on such Revolving Facility Priority Collateral (but not the
Proceeds thereof (until applied to the First Lien Obligations), which shall be
subject to the priorities set forth in this Agreement) shall be automatically,
unconditionally and simultaneously released and the Directing First Lien
Security Agent is irrevocably authorized to execute and deliver or enter into
any release of such Liens or claims that may, in the discretion of the Directing
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Security Agent, be considered necessary or reasonably desirable in connection
with such releases, and the Second Lien Security Agent, for itself or on behalf
of any such Second Lien Secured Parties, promptly shall execute and deliver (at
the expense of such Grantor) to the Directing First Lien Security Agent such
termination statements, releases and other documents as the Directing First Lien
Security Agent or such Grantor may request to effectively confirm such release.

(ii) Until the Discharge of First Lien Obligations occurs, if any Additional
Second Lien Obligations have been issued, the Second Lien Security Agent, for
itself and on behalf of the other Second Lien Secured Parties, hereby
irrevocably constitutes and appoints the Directing First Lien Security Agent and
any officer or agent of the Directing First Lien Security Agent, with full power
of substitution, as its true and lawful attorney in fact with full irrevocable
power and authority in the place and stead of the Second Lien Security Agent or
such Second Lien Secured Party, or in the Directing First Lien Security Agent’s
own name, from time to time in the Directing First Lien Security Agent’s
discretion, for the purpose of carrying out the terms of this Section 4.4(b)
with respect to Revolving Facility Priority Collateral, to take any and all
appropriate action and to execute any and all documents and instruments which
may be necessary to accomplish the purposes of this Section 4.4(b) with respect
to Revolving Facility Priority Collateral, including any endorsements or other
instruments of transfer or release.

(iii) Until the Discharge of First Lien Obligations occurs, to the extent that
the First Lien Secured Parties (a) have released any Lien on Revolving Facility
Priority Collateral and any such Lien is later reinstated or (b) obtain any new
Second Priority Liens (or, after Discharge of Revolving Facility Obligations,
First Priority Liens) on assets constituting Revolving Facility Priority
Collateral from Grantors, then, if any Additional Second Lien Obligations have
been issued, the Second Lien Secured Parties shall be granted a Third Priority
Lien (or, after the Discharge of Revolving Facility Obligations, a Second
Priority Lien) on any such Revolving Facility Priority Collateral.

(c) Insurance – Prior to Discharge of Revolving Facility Obligations. Unless and
until the Discharge of Revolving Facility Obligations has occurred, the
Revolving Facility Agent shall have the sole and exclusive right, subject to the
rights of the Grantors under the Revolving Facility Documents, to adjust
settlement for any Insurance policy covering the Revolving Facility Priority
Collateral in the event of any loss thereunder and to approve any award granted
in any condemnation or similar proceeding (or any deed in lieu of condemnation)
in respect of the Revolving Facility Priority Collateral. If the First Lien
Security Agent, any First Lien Secured Party, the Second Lien Security Agent or
any Second Lien Secured Party shall, at any time, receive any Proceeds of any
such Insurance policy or any such award or payment in contravention of this
Section 4.4(c), it shall pay such Proceeds over to the Revolving Facility Agent
in accordance with the terms of Section 4.3(a).

(d) Insurance – After Discharge of Revolving Facility Obligations. After the
Discharge of Revolving Facility Obligations and unless and until the Discharge
of First Lien Obligations has occurred, the Directing First Lien Security Agent
shall have the sole and exclusive right, subject to the rights of the Grantors
under the First Lien Documents, to adjust settlement for any Insurance policy
covering the Revolving Facility Priority Collateral in the event of any loss
thereunder and to approve any award granted in any condemnation or similar

 

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proceeding (or any deed in lieu of condemnation) in respect of the Revolving
Facility Priority Collateral. If the Second Lien Security Agent or any Second
Lien Secured Party shall, at any time, receive any Proceeds of any such
Insurance policy or any such award or payment in contravention of this
Section 4.4(d), it shall pay such Proceeds over to the First Lien Security Agent
in accordance with the terms of Section 4.3(b).

(e) Amendments to, and Refinancing of, Revolving Facility Documents.

(i) The Revolving Facility Documents may be amended, restated, amended and
restated, replaced, supplemented or otherwise modified in accordance with their
terms and the Revolving Facility Documents may be Refinanced, in each case,
without notice to, or the consent of, the First Lien Security Agent, the other
First Lien Secured Parties, the Second Lien Security Agent or other Second Lien
Secured Parties, all without affecting the Lien subordination or other
provisions of this Agreement; provided, however, that any such amendment,
restatement, amendment and restatement, replacement, supplement, modification or
Refinancing of the Revolving Facility Documents shall not, without the consent
of the Directing First Lien Security Agent and, if any Additional Second Lien
Obligations have been issued, the Directing Second Lien Security Agent:

(A) except as otherwise contemplated or required by the Revolving Facility
Documents (as in effect on the date hereof) and except in connection with any
Revolving Facility DIP Financing permitted hereunder, expressly subordinate the
Lien on all or substantially all of the Revolving Facility Priority Collateral
to the Lien of any other creditor on the Revolving Facility Priority Collateral;
or

(B) add or change any limitation on the optional or mandatory prepayment of the
loans under the First Lien Credit Agreement, any other First Lien Document, any
Additional Second Lien Obligations Agreement or any other Second Lien Document;

Subject to the provisions of the First Lien Documents and the Second Lien
Documents, the Revolving Facility Documents may be Refinanced to the extent the
terms and conditions of such Refinancing Indebtedness meet the requirements of
this Section 4.4(e); provided that the holders of such Refinancing Indebtedness
deliver an Intercreditor Agreement Joinder to the Security Agents.

(ii) In the event the Revolving Facility Agent or the Revolving Facility Secured
Parties and the relevant Grantor enter into any amendment, waiver or consent in
respect of any of the Revolving Facility Security Documents for the purpose of
adding to, or deleting from, or waiving or consenting to any departures from any
provisions of, any Revolving Facility Security Document or changing in any
manner the rights of the Revolving Facility Agent, such Revolving Facility
Secured Parties, the Company or any other Grantor thereunder, in each case with
respect to or relating to the Revolving Facility Priority Collateral, then such
amendment, waiver or consent shall apply automatically to any comparable
provision of the Comparable First Lien Security Document and the Comparable
Second Lien Security Document without the consent of the First Lien Security
Agent, the First Lien Secured Parties, the Second Lien Security Agent or the
Second Lien Secured Parties and without any action by the First Lien Security
Agent, the Second Lien Security Agent, the Company or any other Grantor.

 

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(iii) The Revolving Facility Agent shall endeavor to give prompt notice of any
amendment, waiver or consent of a Revolving Facility Document to the First Lien
Security Agent and, if any Additional Second Lien Obligations have been issued,
the Second Lien Security Agent after the effective date of such amendment,
waiver or consent; provided, that the failure of the Revolving Facility Agent to
give any such notice shall not affect the priority of the Revolving Facility
Agent’s Liens as provided herein or the validity or effectiveness of any such
amendment as against the Grantors.

(f) Rights As Unsecured Creditors.

(i) Except as otherwise set forth in this Agreement, the First Lien Security
Agent and the First Lien Secured Parties may exercise rights and remedies as
unsecured creditors against the Company or any other Grantor in accordance with
the terms of the First Lien Documents to which it is a party and applicable law.
Except as otherwise set forth in this Agreement, nothing in this Agreement shall
prohibit the receipt by the First Lien Security Agent or any First Lien Secured
Parties of the required payments of interest, principal and other amounts in
respect of the First Lien Obligations so long as such receipt is not the direct
or indirect result of the exercise by the First Lien Security Agent or any First
Lien Secured Parties of rights or remedies as a secured creditor (including set
off) in respect of the Revolving Facility Priority Collateral in contravention
of this Agreement or enforcement in contravention of this Agreement of any Lien
on Revolving Facility Priority Collateral held by any of them. In the event the
First Lien Security Agent or any other First Lien Secured Party becomes a
judgment Lien creditor in respect of Revolving Facility Priority Collateral as a
result of its enforcement of its rights as an unsecured creditor, such judgment
Lien shall be subordinated to the Liens securing Revolving Facility Obligations
on the same basis as the other Liens on the Revolving Facility Priority
Collateral securing the First Lien Obligations are so subordinated to such Liens
securing the Revolving Facility Obligations under this Agreement.

(ii) Except as otherwise set forth in this Agreement, if any Additional Second
Lien Obligations have been issued, the Second Lien Security Agent and the other
Second Lien Secured Parties may exercise rights and remedies as unsecured
creditors against the Company or any other Grantor in accordance with the terms
of the Second Lien Documents to which it is a party and applicable law. Except
as otherwise set forth in this Agreement, nothing in this Agreement shall
prohibit the receipt by the Second Lien Security Agent or any Second Lien
Secured Parties of the required payments of interest, principal and other
amounts in respect of the Second Lien Obligations so long as such receipt is not
the direct or indirect result of the exercise by the Second Lien Security Agent
or any Second Lien Secured Parties of rights or remedies as a secured creditor
(including set off) in respect of the Revolving Facility Priority Collateral in
contravention of this Agreement or enforcement in contravention of this
Agreement of any Lien on the Revolving Facility Priority Collateral held by any
of them. In the event the Second Lien Security Agent or any other Second Lien
Secured Party becomes a judgment Lien creditor in respect of Revolving Facility
Priority Collateral as a result of its enforcement of its rights as an unsecured
creditor, such judgment Lien shall be subordinated to (x) the Liens

 

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securing Revolving Facility Obligations and (y) the Liens securing the First
Lien Obligations, in each case, on the same basis as the other Liens on the
Revolving Facility Priority Collateral securing the Second Lien Obligations are
so subordinated to such Revolving Facility Obligations and such First Lien
Obligations, respectively, under this Agreement.

(iii) Except as otherwise set forth in this Agreement (including under Sections
4.1(a) and 4.2(a)), nothing in this Agreement impairs or otherwise adversely
affects any rights or remedies the Revolving Facility Agent or the other
Revolving Facility Secured Parties may have with respect to the Revolving
Facility Priority Collateral.

(g) Bailee for Perfection – Revolving Facility Agent.

(i) The Revolving Facility Agent agrees to hold or control that part of the
Revolving Facility Priority Collateral that is in its possession or control (or
in the possession or control of its agents or bailees) to the extent that
possession or control thereof is taken to perfect a Lien thereon under the UCC
or other applicable law (such Revolving Facility Priority Collateral being, the
“Pledged Revolving Facility Priority Collateral”) as bailee for and, with
respect to any Revolving Facility Priority Collateral that cannot be perfected
in such manner, as agent for, the First Lien Security Agent (on behalf of itself
and the other First Lien Secured Parties) and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent (on behalf of the
Second Lien Secured Parties) and any assignee thereof solely for the purpose of
perfecting the security interest granted under the Revolving Facility Documents,
the First Lien Documents and the Second Lien Documents, respectively, subject to
the terms and conditions of this Section 4.4(g). The Revolving Facility Agent
agrees that, if it shall any time obtain any landlord waiver or bailee’s letter
or similar agreement or arrangement granting it rights or access to Revolving
Facility Priority Collateral, the Revolving Facility Agent shall take such
actions with respect to such landlord waiver, bailee’s letter or similar
agreement or arrangement as sub-agent or gratuitous bailee for the relevant
other Security Agents, solely for the purpose of perfecting the Liens of the
relevant other Security Agents and subject to the terms and conditions of this
Agreement.

(ii) Subject to the terms of this Agreement, until the Discharge of Revolving
Facility Obligations has occurred, the Revolving Facility Agent shall be
entitled to deal with the Pledged Revolving Facility Priority Collateral in
accordance with the terms of the Revolving Facility Documents as if the Liens of
the First Lien Security Agent under the First Lien Security Documents and, if
any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent under the Second Lien Security Documents did not exist. The
rights of the First Lien Security Agent and the Second Lien Security Agent in
the Revolving Facility Priority Collateral shall at all times be subject to the
terms of this Agreement and to the Revolving Facility Agent’s rights under the
Revolving Facility Documents.

(iii) The Revolving Facility Agent shall have no obligation whatsoever to the
First Lien Security Agent, any First Lien Secured Party, the Second Lien
Security Agent or any Second Lien Secured Party to ensure that the Pledged
Revolving Facility Priority Collateral is genuine or owned by any of the
Grantors or to preserve rights or benefits of any Person except as expressly set
forth in this Section 4.4(g). The duties or responsibilities of the Revolving
Facility Agent under this Section 4.4(g) shall be limited solely to holding the
Pledged Revolving Facility Priority Collateral as bailee or agent in accordance
with this Section 4.4(g).

 

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(iv) The Revolving Facility Agent acting pursuant to this Section 4.4(g) shall
not have by reason of the Revolving Facility Security Documents, the First Lien
Security Documents, the Second Lien Security Documents, this Agreement or any
other document a fiduciary relationship in respect of the First Lien Security
Agent, any First Lien Secured Party, the Second Lien Security Agent or any
Second Lien Secured Party.

(v) Upon the Discharge of Revolving Facility Obligations, the Revolving Facility
Agent shall deliver or cause to be delivered the remaining Pledged Revolving
Facility Priority Collateral (if any) in its possession or in possession of its
agents or bailees, together with any necessary endorsements, (A) first, to the
Directing First Lien Security Agent to the extent First Lien Obligations remain
outstanding, (B) second, if any Additional Second Lien Obligations have been
issued, to the Directing Second Lien Security Agent to the extent the Second
Lien Obligations remain outstanding and (C) third, to the applicable Grantor to
the extent no Revolving Facility Obligations, First Lien Obligations or Second
Lien Obligations remain outstanding (in each case, so as to allow such Person to
obtain control of such Pledged Revolving Facility Priority Collateral) and will
cooperate with the Directing First Lien Security Agent, the Directing Second
Lien Security Agent and such Grantor, as the case may be, in assigning (without
recourse to or warranty by the Revolving Facility Agent or any other Revolving
Facility Secured Party or agent or bailee thereof) control over any other
Pledged Revolving Facility Priority Collateral under its control. The Revolving
Facility Agent further agrees to take all other action reasonably requested by
such Person (at the sole cost and expense of the Grantors or such Person) in
connection with such Person obtaining a First Priority security interest in the
Pledged Revolving Facility Priority Collateral or as a court of competent
jurisdiction may otherwise direct. Notwithstanding the foregoing, with respect
to any Deposit Accounts, Commodity Accounts or Securities Accounts, the
Revolving Facility Agent shall only be required to give notice of resignation to
the counterparty thereunder.

(vi) Notwithstanding anything to the contrary herein:

(A) if, for any reason, any First Lien Obligations remain outstanding upon the
Discharge of Revolving Facility Obligations, all rights of the Revolving
Facility Agent hereunder and under the Revolving Facility Security Documents
(1) with respect to the delivery and control of any part of the Revolving
Facility Priority Collateral, and (2) to direct, instruct, vote upon or
otherwise influence the maintenance or disposition of such Revolving Facility
Priority Collateral, shall immediately, and (to the extent permitted by law)
without further action on the part of either of the First Lien Security Agent or
the Revolving Facility Agent, pass to the Directing First Lien Security Agent,
who shall thereafter hold such rights for the benefit of the First Lien Secured
Parties. The Revolving Facility Agent agrees that it will, if any First Lien
Obligations remain outstanding upon the Discharge of Revolving Facility
Obligations, take any other action required by any law or reasonably requested
by the Directing First Lien Security Agent (subject to any limitations set forth
in the First Lien Documents), in connection with the First Lien Security Agent’s
establishment and perfection of a First Priority security interest in the
Revolving Facility Priority Collateral; and

 

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(B) if, for any reason, any Additional Second Lien Obligations have been issued
and the applicable Second Lien Obligations remain outstanding upon the Discharge
of Revolving Facility Obligations and the Discharge of First Lien Obligations,
all rights of the Revolving Facility Agent hereunder and under the Revolving
Facility Security Documents and all rights of the First Lien Security Agent
hereunder and under the First Lien Security Documents (1) with respect to the
delivery and control of any part of the Revolving Facility Priority Collateral,
and (2) to direct, instruct, vote upon or otherwise influence the maintenance or
disposition of such Revolving Facility Priority Collateral, shall immediately,
and (to the extent permitted by law) without further action on the part of any
of the First Lien Security Agent, the Second Lien Security Agent or the
Revolving Facility Agent, pass to the Directing Second Lien Security Agent, who
shall thereafter hold such rights for the benefit of the Second Lien Secured
Parties. Each of the Directing First Lien Security Agent and Revolving Facility
Agent agrees that it will, if any Second Lien Obligations remain outstanding
upon the Discharge of Revolving Facility Obligations and the Discharge of First
Lien Obligations, take any other action required by any law or reasonably
requested by the Directing Second Lien Security Agent (subject to any
limitations set forth in the Second Lien Facility Documents), in connection with
the Directing Second Lien Security Agent’s establishment and perfection of a
First Priority security interest in the Revolving Facility Priority Collateral.

(vii) Notwithstanding anything to the contrary contained herein, if for any
reason, prior to the Discharge of First Lien Obligations and, if any Additional
Second Lien Obligations have been issued, the Discharge of Second Lien
Obligations, the Revolving Facility Agent acquires possession of any Pledged
Notes Priority Collateral, the Revolving Facility Agent shall hold same as
bailee and/or agent to the same extent as is provided in preceding clause
(i) with respect to Pledged Revolving Facility Priority Collateral, provided
that as soon as is practicable the Revolving Facility Agent shall deliver or
cause to be delivered such Pledged Notes Priority Collateral to the Directing
First Lien Security Agent or, after the Discharge of First Lien Obligations has
occurred, to the Directing Second Lien Security Agent, as the case may be, in a
manner otherwise consistent with the requirements of preceding clause (v).

(h) Bailee for Perfection – First Lien Security Agent.

(i) After the Discharge of Revolving Facility Obligations has occurred, and to
the extent that the Directing First Lien Security Agent holds or controls any
Pledged Revolving Facility Priority Collateral, if any Additional Second Lien
Obligations have been issued, the Directing First Lien Security Agent agrees to
hold or control that part of the Pledged Revolving Facility Priority Collateral
that is in its possession or control (or in the possession or control of its
agents or bailees) to the extent that possession or control thereof is taken to
perfect a Lien thereon under the UCC or other applicable law as collateral agent
for the First Lien Secured Parties and as bailee for and, with respect to any
Revolving Facility Priority Collateral that cannot be perfected in such manner,
as agent for, the Directing Second Lien Security Agent (on behalf of itself and
the other Second Lien Secured Parties) and any assignee thereof solely for the

 

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purpose of perfecting the security interest granted under the First Lien and the
Second Lien Documents, respectively, subject to the terms and conditions of this
Section 4.4(h). The Directing First Lien Security Agent agrees that, if it shall
any time obtain any landlord waiver or bailee’s letter or similar agreement or
arrangement granting it rights or access to Revolving Facility Priority
Collateral, the Directing First Lien Security Agent shall take such actions with
respect to such landlord waiver, bailee’s letter or similar agreement or
arrangement as sub-agent or gratuitous bailee for the Second Lien Security
Agent, solely for the purpose of perfecting the Liens of the Second Lien
Security Agent and subject to the terms and conditions of this Agreement.

(ii) Subject to the terms of this Agreement, after the Discharge of Revolving
Facility Obligations has occurred and until the Discharge of First Lien
Obligations has occurred, the Directing First Lien Security Agent shall be
entitled to deal with the Pledged Revolving Facility Priority Collateral in
accordance with the terms of the First Lien Documents as if the Liens (if any
Additional Second Lien Obligations have been issued) of the Second Lien Security
Agent under the Second Lien Security Documents did not exist. The rights of the
Second Lien Security Agent in the Revolving Facility Priority Collateral shall
at all times be subject to the terms of this Agreement and to the First Lien
Security Agent’s rights under the First Lien Documents.

(iii) The Directing First Lien Security Agent shall have no obligation
whatsoever to any First Lien Secured Party, the Second Lien Security Agent or
any Second Lien Secured Party to ensure that the Pledged Revolving Facility
Priority Collateral is genuine or owned by any of the Grantors or to preserve
rights or benefits of any Person except as expressly set forth in this
Section 4.4(h). The duties or responsibilities of the First Lien Security Agent
under this Section 4.4(h) shall be limited solely to holding the Pledged
Revolving Facility Priority Collateral as bailee or agent in accordance with
this Section 4.4(h).

(iv) The Directing First Lien Security Agent acting pursuant to this
Section 4.4(h) shall not have by reason of the First Lien Security Documents,
the Second Lien Security Documents, this Agreement or any other document a
fiduciary relationship in respect of any First Lien Secured Party, the Second
Lien Security Agent or any Second Lien Secured Party.

(v) Following the Discharge of Revolving Facility Obligations and upon the
Discharge of First Lien Obligations, the Directing First Lien Security Agent
shall deliver or cause to be delivered the remaining Pledged Revolving Facility
Priority Collateral (if any) in its possession or in possession of its agents or
bailees, together with any necessary endorsements, (A) first, if any Additional
Second Lien Obligations have been issued, to the Directing Second Lien Security
Agent to the extent the Second Lien Obligations remain outstanding and
(B) second, to the applicable Grantor to the extent no First Lien Obligations or
Second Lien Obligations remain outstanding (in each case, so as to allow such
Person to obtain control of such Pledged Revolving Facility Priority Collateral)
and will cooperate with the Directing Second Lien Security Agent or such
Grantor, as the case may be, in assigning (without recourse to or warranty by
the Directing First Lien Security Agent or any other First Lien Secured Party or
agent or bailee thereof) control over any other Pledged Revolving Facility
Priority Collateral under its control. The Directing First Lien Security Agent
further agrees to take all other action

 

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reasonably requested by such Person (at the sole cost and expense of the
Grantors or such Person) in connection with such Person obtaining a First
Priority security interest in the Pledged Revolving Facility Priority Collateral
or as a court of competent jurisdiction may otherwise direct. Notwithstanding
the foregoing, with respect to any Deposit Accounts, Commodity Accounts or
Securities Accounts, the Directing First Lien Security Agent shall only be
required to give notice of resignation to the counterparty thereunder.

(vi) Notwithstanding anything to the contrary herein, if, for any reason, if any
Additional Second Lien Obligations have been issued, and any Second Lien
Obligations remain outstanding upon the Discharge of Revolving Facility
Obligations and the Discharge of First Lien Obligations, all rights of the First
Lien Security Agent hereunder and under the First Lien Security Documents
(1) with respect to the delivery and control of any part of the Revolving
Facility Priority Collateral, and (2) to direct, instruct, vote upon or
otherwise influence the maintenance or disposition of such Revolving Facility
Priority Collateral, shall immediately, and (to the extent permitted by law)
without further action on the part of any of the First Lien Security Agent or
the Second Lien Security Agent, pass to the Directing Second Lien Security
Agent, who shall thereafter hold such rights for the benefit of the Second Lien
Secured Parties. Each of the Directing First Lien Security Agent and the
Grantors agrees that it will, if any Second Lien Obligations remain outstanding
upon the Discharge of Revolving Facility Obligations and the Discharge of First
Lien Obligations, take any other action required by any law or reasonably
requested by the Directing Second Lien Security Agent (subject to any
limitations set forth in the Second Lien Facility Documents), in connection with
the Directing Second Lien Security Agent’s establishment and perfection of a
First Priority security interest in the Revolving Facility Priority Collateral.

(i) When Discharge of Revolving Facility Obligations Deemed to Not Have
Occurred. Notwithstanding anything to the contrary herein, if concurrently with
(or immediately after) the Discharge of Revolving Facility Obligations, the
Company and/or any Grantor enters into any Permitted Refinancing of any
Revolving Facility Obligations, then such Discharge of Revolving Facility
Obligations shall automatically be deemed not to have occurred for all purposes
of this Agreement, and the obligations under the Permitted Refinancing shall
automatically be treated as Revolving Facility Obligations (together with any
Revolving Facility Bank Product Obligations and Revolving Facility Secured
Hedging Obligations thereunder) for all purposes of this Agreement, including
for purposes of the Lien priorities and rights in respect of Collateral set
forth herein, the term “Revolving Facility Credit Agreement” shall be deemed
appropriately modified to refer to such Permitted Refinancing and the Revolving
Facility Agent under such Revolving Facility Documents shall be the Revolving
Facility Agent for all purposes hereof and the new secured parties under such
Revolving Facility Documents (together with the Revolving Facility Bank Product
Creditors and Revolving Facility Hedging Creditors thereunder) shall
automatically be treated as Revolving Facility Secured Parties for all purposes
of this Agreement. Upon receipt of a notice stating that the Company and/or any
Grantor has entered into a new Revolving Facility Document in respect of a
Permitted Refinancing of Revolving Facility Obligations (which notice shall
include the identity of the new agent, such agent, the “New Revolving Facility
Agent”), and delivery by the New Revolving Facility Agent of an Intercreditor
Agreement Joinder, each of the First Lien Security Agent and, if any Additional
Second Lien Obligations have been issued, the Second Lien Security Agent shall

 

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promptly (i) enter into such documents and agreements (including amendments,
amendments and restatements, or supplements to this Agreement) as the Company
and/or any Grantor or such New Revolving Facility Agent shall reasonably request
in order to provide to the New Revolving Facility Agent the rights contemplated
hereby, in each case consistent in all material respects with the terms of this
Agreement and (ii) deliver to the New Revolving Facility Agent any Pledged
Revolving Facility Priority Collateral held by the First Lien Security Agent or
the Second Lien Security Agent, respectively, together with any necessary
endorsements (or otherwise allow the New Revolving Facility Agent to obtain
control of such Pledged Revolving Facility Priority Collateral). The New
Revolving Facility Agent shall agree to be bound by the terms of this Agreement.
If the new Revolving Facility Obligations under the new Revolving Facility
Documents are secured by assets of the Grantors of the type constituting
Revolving Facility Priority Collateral that do not also secure the First Lien
Obligations and, if any Additional Second Lien Obligations have been issued, the
Second Lien Obligations, then each of the First Lien Obligations and the Second
Lien Obligations shall be secured at such time by a Second Priority Lien and
Third Priority Lien, respectively, on such assets to the same extent provided in
the First Lien Security Documents and the Second Lien Security Documents with
respect to the other Revolving Facility Priority Collateral. If the new
Revolving Facility Obligations under the new Revolving Facility Documents are
secured by assets of the Grantors of the type constituting Notes Priority
Collateral that do not also secure each of the First Lien Obligations and the
Second Lien Obligations, then each of the First Lien Obligations and the Second
Lien Obligations shall be secured at such time by a First Priority Lien and
Second Priority Lien, respectively, on such assets to the same extent provided
in the First Lien Security Documents and Second Lien Security Documents with
respect to the other Notes Priority Collateral.

 

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(j) Option to Purchase Revolving Facility Obligations.

(i) Without prejudice to the enforcement of remedies by the Revolving Facility
Agent and the Revolving Facility Secured Parties, the First Lien Secured Parties
or, if any Additional Second Lien Obligations have been issued, to the extent
any Second Lien Secured Party has exercised the First Lien Purchase Option, such
Second Lien Secured Party (in each case who must meet all eligibility standards
contained in all relevant Revolving Facility Documents) (each, an “Eligible
Revolving Facility Purchaser”) shall have the right to purchase on a pro rata
basis by way of assignment (and shall thereby also assume all commitments and
duties of the then extant Revolving Facility Secured Parties under the Revolving
Facility Documents (other than in respect of services giving rise to Revolving
Facility Bank Product Obligations and Revolving Facility Secured Hedging
Obligations)), at any time during the exercise period described in clause
(iii) below of this Section 4.4(j), all, but not less than all, of the Revolving
Facility Obligations (inclusive of Revolving Facility Priority Obligations and
Excess Revolving Facility Obligations) (other than the Revolving Facility
Obligations of a Defaulting Revolving Facility Secured Party), including all
principal of and accrued and unpaid interest and fees on and all prepayment or
acceleration penalties and premiums in respect of all Revolving Facility
Obligations outstanding at the time of purchase; provided that at the time of
(and as a condition to) any purchase pursuant to this Section 4.4(j), all
commitments pursuant to any then outstanding Revolving Facility Credit Agreement
shall have terminated and all Revolving Facility Secured Hedging Agreements also
shall have been terminated in accordance with their terms. Any purchase pursuant
to this Section 4.4(j) shall be made as follows:

(A) for a purchase price equal to the sum of (1) in the case of all loans,
advances or other similar extensions of credit that constitute Revolving
Facility Obligations (including unreimbursed amounts drawn in respect of letters
of credit, but excluding the undrawn amount of then outstanding letters of
credit and excluding Revolving Facility Bank Product Obligations), 100% of the
principal amount thereof and all accrued and unpaid interest thereon through the
date of purchase (without regard, however, to any unaccrued acceleration or
other prepayment penalties or premiums other than customary breakage costs),
(2) in the case of any Revolving Facility Bank Product Obligations, cash
collateral in such amounts as the Revolving Facility Agent reasonably determines
is necessary to secure the Revolving Facility Agent and the other Revolving
Facility Secured Parties in connection with such Revolving Facility Bank Product
Obligations, (3) in the case of any Revolving Facility Secured Hedging
Agreement, the aggregate amount then owing to each Revolving Facility Hedging
Creditor (which is a Revolving Facility Secured Party) thereunder pursuant to
the terms of the respective Revolving Facility Secured Hedging Agreement,
including all amounts owing to such Revolving Facility Hedging Creditor as a
result of the termination (or early termination) thereof (in each case, to the
extent of its interest as a Revolving Facility Secured Party), (4) in the case
of the undrawn amount of then outstanding letters of credit, cash collateral in
an amount equal to 103% of the aggregate undrawn amount of such letters of
credit and the aggregate fronting and other fees which will accrue thereon
through the stated maturity of the letters of credit (assuming no drawings
thereon before stated maturity), (5) all accrued and unpaid fees, expenses,
indemnities and other amounts (other than any unaccrued prepayment penalties or
premiums or similar fees) through the date of purchase and (6) in the case of
contingent or unliquidated Revolving Facility Obligations for which a claim has
been made against (or identified by) the Revolving Facility Secured Parties and
indemnification or payment is required under the Revolving Facility Documents,
cash collateral in such amounts as the Revolving Facility Agent reasonably
determines to be necessary to secure the Revolving Facility Agent and the other
Revolving Facility Secured Parties in connection with such contingent or
unliquidated Revolving Facility Obligations; it being understood and agreed that
(w) if at any time those amounts (if any) then on deposit with the Revolving
Facility Agent as described in clause (4) above exceed 103% of the sum of the
aggregate undrawn amount of all then outstanding letters of credit and the
aggregate fronting and other fees accrued thereon before stated maturity, such
excess shall be returned to the respective Eligible Revolving Facility Purchaser
or Eligible Revolving Facility Purchasers (as their interests appear), (x) at
such time as all letters of credit have been cancelled, expired or been fully
drawn, as the case may be, any excess cash collateral deposited as described
above in clause (4) (and not previously applied or released as provided above)
shall be returned to the respective Eligible Revolving Facility Purchaser or
Eligible Revolving Facility Purchasers, as their interests appear, (y) at such
time as all Revolving Facility Bank Product Agreements have been terminated, any
excess cash collateral deposited as described above in clause (2) (and not
previously applied or released as provided above) shall be returned to the
respective Eligible Revolving Facility Purchaser or Eligible

 

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Revolving Facility Purchasers, as their interests appear, and (z) at such time
as all contingent or unliquidated Revolving Facility Obligations described in
clause 6 are settled or otherwise resolved, any excess cash collateral deposited
as described above in clause 6 (and not applied or previously released) shall be
returned to the respective Eligible Revolving Facility Purchaser or Eligible
Revolving Facility Purchasers, as their interests appear. It is understood and
agreed that (x) at the time any fronting or other fees are owing to an issuer
with respect to any letter of credit, the Revolving Facility Agent may apply
amounts deposited with it as described above to pay same and (y) upon any
drawing under any letter of credit, the Revolving Facility Agent shall apply
amounts deposited with it as described above to repay the respective unpaid
drawing;

(B) with the purchase price described in preceding clause (i)(A) payable in cash
on the date of purchase against transfer to the respective Eligible Revolving
Facility Purchaser or Eligible Revolving Facility Purchasers (without recourse
and without any representations or warranties whatsoever, whether as to the
enforceability of any Revolving Facility Obligation or the validity,
enforceability, perfection, priority or sufficiency of any Lien securing, or
guarantee or other supporting obligation for, any Revolving Facility Obligation
or as to any other matter whatsoever, except the representations and warranties
(1) that the transferor owns free and clear of all Liens and encumbrances (other
than participation interests not prohibited by the Revolving Facility Credit
Agreement, in which case the purchase price described in preceding clause (i)(A)
shall be appropriately adjusted so that the Eligible Revolving Facility
Purchaser or Eligible Revolving Facility Purchasers do not pay amounts
represented by any participation interest which remains in effect), and has the
right to convey, whatever claims and interests it may have in respect of the
Revolving Facility Obligations) and (2) as to the amount of its portion of the
Revolving Facility Obligations being acquired);

(C) with the purchase price described in preceding clause (i)(A) accompanied by
a waiver of all claims arising out of this Agreement and the transactions
contemplated hereby as a result of exercising the purchase option contemplated
by this Section 4.4(j) by (x) the Directing Second Lien Security Agent (on
behalf of itself and the other Second Lien Secured Parties) if such Eligible
Revolving Facility Purchaser is the Second Lien Security Agent or any Second
Lien Secured Party or (y) the Directing First Lien Security Agent (on behalf of
itself and the other First Lien Secured Parties) if such Eligible Revolving
Facility Purchaser is the First Lien Security Agent or any First Lien Secured
Party;

(D) with all amounts payable to the various Revolving Facility Secured Parties
in respect of the assignments described above to be distributed to them by the
Revolving Facility Agent in accordance with their respective holdings of the
various Revolving Facility Obligations; and

(E) with such purchase to be made pursuant to assignment documentation in form
and substance reasonably satisfactory to, and prepared by counsel for, the
Revolving Facility Agent (with the reasonable cost of such counsel to be paid by

 

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the respective Eligible Revolving Facility Purchaser or Eligible Revolving
Facility Purchasers); it being understood and agreed that the Revolving Facility
Agent and each other Revolving Facility Secured Party shall retain all rights to
indemnification as provided in the relevant Revolving Facility Documents for all
periods prior to any assignment by them pursuant to the provisions of this
Section 4.4(j).

(ii) The right to exercise the purchase option described in Section 4.4(j)(i)
above shall be exercisable and legally enforceable upon at least ten
(10) Business Days’ prior written notice of exercise (which notice, once given,
(A) shall be irrevocable and fully binding on the respective Eligible Revolving
Facility Purchaser or Eligible Revolving Facility Purchasers except as provided
in clause (iii) below and (B) shall specify a date of purchase not less than ten
(10) Business Days, nor more than thirty (30) calendar days, after the date of
the receipt by the Revolving Facility Agent of such notice) given to the
Revolving Facility Agent by an Eligible Revolving Facility Purchaser; provided
that if such Eligible Revolving Facility Purchaser is the Second Lien Security
Agent or a Second Lien Secured Party, then the closing of the purchase of the
Revolving Facility Obligations under this Section 4.4(j) shall occur within the
aforesaid period and contemporaneously with or promptly following the closing by
such Second Lien Security Agent or Second Lien Secured Party of the purchase of
First Lien Obligations in accordance with Section 3.4(l). Neither the Revolving
Facility Agent nor any Revolving Facility Secured Party shall have any
disclosure obligation to any Eligible Revolving Facility Purchaser, the First
Lien Security Agent, any First Lien Secured Party, the Second Lien Security
Agent or any Second Lien Secured Party in connection with any exercise of such
purchase option.

(iii) The right to purchase the Revolving Facility Obligations as described in
this Section 4.4(j) may be exercised (A) by a Second Lien Secured Party that has
exercised the First Lien Purchase Option in accordance with Section 3.4(l) and
is an Eligible Revolving Facility Purchaser (by giving the irrevocable written
notice described in preceding clause (ii)) during the period (the “Second Lien
Purchase Option Period”) that (1) begins on the date occurring three Business
Days after the first to occur of (x) the date of the acceleration of the final
maturity of the loans under the Revolving Facility Credit Agreement, (y) the
failure to pay all outstanding loans and obligations in full in cash on the
final maturity date of the Revolving Facility Credit Agreement or (z) the
occurrence of an Insolvency or Liquidation Proceeding with respect to the
Company or any Grantor which constitutes an event of default under the Revolving
Facility Credit Agreement (in each case, so long as the acceleration, failure to
pay amounts due at final maturity or such Insolvency or Liquidation Proceeding
constituting an event of default has not been rescinded or cured within ten
(10) Business Days after any such event, and so long as any unpaid amounts
constituting Revolving Facility Obligations remain owing); provided that if
there is any failure to meet the condition described in the proviso of preceding
clause (i) hereof, the aforementioned date shall be extended until the first
date upon which such condition is satisfied and (2) ends on the tenth
(10th) Business Day after the start of the Second Lien Purchase Option Period
and (B) in the event that no Second Lien Secured Party has exercised the First
Lien Purchase Option within the option period set forth in Section 3.4(l), by a
First Lien Secured Party that is an Eligible Revolving Facility Purchaser (by
giving the irrevocable written notice described in the preceding clause (ii))
during the period that begins on the first Business Day immediately following
the expiration of the Second Lien Purchase Option Period and ends on the tenth
(10th) Business Day thereafter (the “First Lien Purchase Option Period”);
provided,

 

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however, if a Second Lien Secured Party has exercised the First Lien Purchase
Option in accordance with Section 3.4(l) and fails to close such purchase within
the prescribed period, the First Lien Purchase Option Period shall be deemed not
to commence until the earlier of the closing date specified in the notice
delivered by such Second Lien Secured Party as described in the preceding clause
or the date of such failure by such Second Lien Secured Party. If no First Lien
Secured Party or Second Lien Secured Party timely exercises the aforementioned
purchase option, the Revolving Facility Agent and Revolving Facility Secured
Parties shall have no further obligations pursuant to this Section 4.4(j) and
may take any further actions in their sole discretion in accordance with the
Revolving Facility Documents and this Agreement.

(iv) The obligations of the Revolving Facility Secured Parties to sell their
respective Revolving Facility Obligations under this Section 4.4(j) are several
and not joint and several. To the extent any Revolving Facility Secured Party
breaches its obligation to sell its Revolving Facility Obligations under this
Section 4.4(j) (a “Defaulting Revolving Facility Secured Party”), nothing in
this Section 4.4(j) shall be deemed to require the Revolving Facility Agent or
any other Revolving Facility Secured Party to purchase such Defaulting Revolving
Facility Secured Party’s Revolving Facility Obligations for resale to the
holders of First Lien Obligations and in all cases, the Revolving Facility Agent
and each Revolving Facility Secured Party complying with the terms of this
Section 4.4(j) shall not be deemed to be in default of this Agreement or
otherwise be deemed liable for any action or inaction of any Defaulting
Revolving Facility Secured Party; provided that nothing in this clause
(iv) shall require any Eligible Revolving Facility Purchaser to purchase less
than all of the Revolving Facility Obligations.

(v) Each Grantor irrevocably consents to any assignment effected to one or more
Eligible Revolving Facility Purchasers pursuant to this Section 4.4(j) (so long
as they meet all eligibility standards contained in all relevant Revolving
Facility Documents, other than obtaining the consent of any Grantor to an
assignment to the extent required by such Revolving Facility Documents) for
purposes of all Revolving Facility Documents and hereby agrees that no further
consent to any such assignment pursuant to this Section 4.4(j) from such Grantor
shall be required.

4.5. Insolvency or Liquidation Proceedings.

(a) Finance and Sale Issues – Revolving Facility Obligations. Until the
Discharge of Revolving Facility Obligations has occurred, if the Company or any
other Grantor shall be subject to any Insolvency or Liquidation Proceeding and
the Revolving Facility Agent shall desire to permit the use of cash collateral
(as such term is defined in Section 363(a) of the Bankruptcy Code) constituting
Revolving Facility Priority Collateral or to permit the Company or any other
Grantor to obtain financing, whether from the Revolving Facility Secured Parties
or any other entity under Section 364 of the Bankruptcy Code or any similar
Debtor Relief Law, that is secured by a Lien that is (i) senior or pari passu
with the Liens on the Revolving Facility Priority Collateral securing the
Revolving Facility Priority Obligations and (ii) junior to the Liens on the
Notes Priority Collateral securing the First Lien Priority Obligations and, if
any Additional Second Lien Obligations have been issued, the Second Lien
Priority Obligations (each, a “Revolving Facility DIP Financing”), then the
First Lien Security Agent, on behalf of itself and the other First Lien Secured
Parties, and the Second Lien Security Agent, on behalf of

 

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itself and the other Second Lien Secured Parties, agrees that it will not oppose
or raise any objection to or contest (or join with or support any third party
opposing, objecting or contesting) such use of cash collateral constituting
Revolving Facility Priority Collateral or such Revolving Facility DIP Financing
and will not request adequate protection or any other relief in connection
therewith (except, as expressly agreed by the Revolving Facility Agent or to the
extent permitted by Section 4.5(d)) and, the First Lien Security Agent and, if
any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent will each subordinate its Liens in the Revolving Facility
Priority Collateral to the Liens securing such Revolving Facility DIP Financing
(and all interest and other obligations relating thereto); provided that (A) the
aggregate principal amount of the Revolving Facility DIP Financing plus the
aggregate outstanding principal amount of Revolving Facility Obligations for
borrowed money under the Revolving Facility Documents plus the aggregate face
amount of any letters of credit issued and not reimbursed under the Revolving
Facility Documents shall not exceed the Revolving Facility Debt Cap and
(B) (i) each of the First Lien Security Agent and the other First Lien Secured
Parties and, if any Additional Second Lien Obligations have been issued, the
Second Lien Security Agent and the other Second Lien Secured Parties retain a
Lien on the Collateral to secure the First Lien Priority Obligations and Second
Lien Priority Obligations, respectively, and, with respect to the Notes Priority
Collateral only, with the same priority as existed prior to the commencement of
the Insolvency or Liquidation Proceeding, (ii) to the extent that the Revolving
Facility Agent is granted adequate protection in the form of a Lien, the First
Lien Security Agent and, if any Additional Second Lien Obligations have been
issued, the Second Lien Security Agent are each permitted to seek a Lien
(without objection from the Revolving Facility Agent or any Revolving Facility
Secured Party) on Collateral arising after the commencement of the Insolvency or
Liquidation Proceeding (so long as, with respect to Revolving Facility Priority
Collateral, such Lien is junior to the Liens securing such Revolving Facility
DIP Financing and the Revolving Facility Priority Obligations, (iii) the
foregoing provisions of this Section 4.5(a) shall not prevent the First Lien
Security Agent and the First Lien Secured Parties and, if any Additional Second
Lien Obligations have been issued, the Second Lien Security Agent and the Second
Lien Secured Parties from objecting to any provision in any Revolving Facility
DIP Financing relating to any provision or content of a plan of reorganization
or other plan of similar effect under any Debtor Relief Laws that are
inconsistent with this Agreement and (iv) the terms of such Revolving Facility
DIP Financing do not require any Grantor to seek approval for any plan of
reorganization that is inconsistent with the terms of this Agreement. The First
Lien Security Agent, on behalf of the First Lien Secured Parties, and, if any
Additional Second Lien Obligations have been issued, the Second Lien Security
Agent, on behalf of the Second Lien Secured Parties, each agrees that it will
not raise any objection or oppose a sale or other disposition of any Revolving
Facility Priority Collateral free and clear of its Liens (subject to attachment
of Proceeds with respect to the Second Priority Lien on the Revolving Facility
Priority Collateral in favor of the First Lien Security Agent and the Third
Priority Lien on the Revolving Facility Priority Collateral in favor of the
Second Lien Security Agent in the same order and manner as otherwise set forth
herein) or other claims under Section 363 of the Bankruptcy Code, except for any
objection or opposition that could be asserted by any First Lien Secured Party
or, if any Additional Second Lien Obligations have been issued, any Second Lien
Secured Party as an unsecured creditor in any such Insolvency or Liquidation
Proceeding if the First Lien Secured Parties and Second Lien Secured Parties
have consented to such sale or disposition of such assets; provided that the
foregoing shall not prohibit the First

 

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Lien Security Agent, the other First Lien Secured Parties, the Second Lien
Security Agent and the other Second Lien Secured Parties from seeking and
exercising credit bid rights pursuant to Section 363(k) of the Bankruptcy Code
in respect of any such sale or disposition; provided, further that such credit
bid may only be made if Discharge of Revolving Facility Obligations (and, in the
case of a credit bid by the Second Lien Security Agent or the other Second Lien
Secured Parties, Discharge of First Lien Obligations) has occurred or will occur
concurrently as a result of a cash bid for such Revolving Priority Collateral in
addition to such credit bid.

(b) Finance and Sale Issues – First Lien Obligations. After the Discharge of
Revolving Facility Obligations has occurred and until the Discharge of First
Lien Obligations has occurred and to the extent any Additional Second Lien
Obligations have been issued, if the Company or any other Grantor shall be
subject to any Insolvency or Liquidation Proceeding and the First Lien Security
Agent shall desire to permit the use of cash collateral (as such term is defined
in Section 363(a) of the Bankruptcy Code) constituting Revolving Facility
Priority Collateral or to permit the Company or any other Grantor to obtain
financing, whether from the First Lien Secured Parties or any other entity under
Section 364 of the Bankruptcy Code or any similar Debtor Relief Law, that is
secured by a Lien that is (i) senior or pari passu with the Liens on the
Revolving Facility Priority Collateral securing the First Lien Priority
Obligations and (ii) junior to the Liens on the Notes Priority Collateral
securing the Second Lien Priority Obligations (each, a “First Lien Revolving
Facility Priority Collateral DIP Financing”), then the Second Lien Security
Agent, on behalf of itself and the other Second Lien Secured Parties, agrees
that it will not oppose or raise any objection to or contest (or join with or
support any third party opposing, objecting or contesting) such use of cash
collateral constituting Revolving Facility Priority Collateral or such First
Lien Revolving Facility Priority Collateral DIP Financing and will not request
adequate protection or any other relief in connection therewith (except, as
expressly agreed by the First Lien Security Agent or to the extent permitted by
Section 4.5(d)) and, the Second Lien Security Agent will subordinate its Liens
in the Revolving Facility Priority Collateral to the Liens securing such First
Lien Revolving Facility Priority Collateral DIP Financing (and all interest and
other obligations relating thereto); provided that (A) the aggregate principal
amount of the First Lien Revolving Facility Priority Collateral DIP Financing
plus the aggregate outstanding principal amount of First Lien Obligations for
borrowed money under the First Lien Documents plus the aggregate face amount of
any letters of credit issued and not reimbursed under the First Lien Documents
shall not exceed the First Lien Debt Cap and (B) (i) the Second Lien Security
Agent and the other Second Lien Secured Parties retain a Lien on the Collateral
to secure the Second Lien Priority Obligations, respectively, and, with respect
to the Notes Priority Collateral only, with the same priority as existed prior
to the commencement of the Insolvency or Liquidation Proceeding, (ii) to the
extent that the First Lien Security Agent is granted adequate protection in the
form of a Lien, the Second Lien Security Agent is permitted to seek a Lien
(without objection from the First Lien Security Agent or any First Lien Secured
Party) on Collateral arising after the commencement of the Insolvency or
Liquidation Proceeding (so long as, with respect to Revolving Facility Priority
Collateral, such Lien is junior to the Liens securing such First Lien Revolving
Facility Priority Collateral DIP Financing and the First Lien Priority
Obligations), (iii) the foregoing provisions of this Section 4.5(b) shall not
prevent the Second Lien Security Agent and the Second Lien Secured Parties from
objecting to any provision in any First Lien Revolving Facility Priority
Collateral DIP Financing relating to any provision or content of a plan of
reorganization or other plan of similar effect under any Debtor

 

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Relief Laws that are inconsistent with this Agreement and (iv) the terms of such
First Lien Revolving Facility Priority Collateral DIP Financing do not require
any Grantor to seek approval for any plan of reorganization that is inconsistent
with the terms of this Agreement. The Second Lien Security Agent, on behalf of
the Second Lien Secured Parties, agrees that it will not raise any objection or
oppose a sale or other disposition of any Revolving Facility Priority Collateral
free and clear of its Liens (subject to attachment of Proceeds with respect to
the Second Priority Lien on the Revolving Facility Priority Collateral in favor
of the Second Lien Security Agent in the same order and manner as otherwise set
forth herein) or other claims under Section 363 of the Bankruptcy Code, except
for any objection or opposition that could be asserted by any Second Lien
Secured Party as an unsecured creditor in any such Insolvency or Liquidation
Proceeding if the Second Lien Secured Parties have consented to such sale or
disposition of such assets; provided that the foregoing shall not prohibit the
Second Lien Security Agent and the other Second Lien Secured Parties from
seeking and exercising credit bid rights pursuant to Section 363(k) of the
Bankruptcy Code in respect of any such sale or disposition; provided, further
that such credit bid may only be made if Discharge of First Lien Obligations has
occurred or will occur concurrently as a result of a cash bid for such Revolving
Priority Collateral in addition to such credit bid.

(c) Relief from the Automatic Stay.

(i) Until the Discharge of Revolving Facility Obligations has occurred, each of
the First Lien Security Agent, on behalf of itself and the other First Lien
Secured Parties, and, if any Additional Second Lien Obligations have been
issued, the Second Lien Security Agent, on behalf of itself and the other Second
Lien Secured Parties, agrees that none of them shall seek (or support any other
Person seeking) relief from the automatic stay or any other stay in any
Insolvency or Liquidation Proceeding in respect of the Revolving Facility
Priority Collateral, without the prior written consent of the Revolving Facility
Agent.

(ii) Until the Discharge of First Lien Obligations has occurred, if any
Additional Second Lien Obligations have been issued, the Second Lien Security
Agent, on behalf of itself and the other Second Lien Secured Parties, agrees
that none of them shall seek (or support any other Person seeking) relief from
the automatic stay or any other stay in any Insolvency or Liquidation Proceeding
in respect of the Revolving Facility Priority Collateral, without the prior
written consent of the Directing First Lien Security Agent.

(d) Adequate Protection.

(i) Each of the First Lien Security Agent, on behalf of itself and the other
First Lien Secured Parties, and, if any Additional Second Lien Obligations have
been issued, the Second Lien Security Agent, on behalf of itself and the other
Second Lien Secured Parties, agrees that none of them shall contest (or support
any other Person contesting) (A) any request by the Revolving Facility Agent or
the Revolving Facility Secured Parties for adequate protection or similar
protection under any Debtor Relief Law with respect to any Revolving Facility
Priority Collateral, (B) so long as the request of adequate protection is in the
form of a replacement Lien on the Notes Priority Collateral that is junior to
the Liens on the Notes Priority Collateral securing the First Lien Priority
Obligations and, if any Additional Second Lien

 

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Obligations have been issued, the Second Lien Priority Obligations, any request
by the Revolving Facility Agent or the Revolving Facility Secured Parties for
adequate protection with respect to any Notes Priority Collateral or (C) any
objection by the Revolving Facility Agent or the Revolving Facility Secured
Parties to any motion, relief, action or proceeding based on the Revolving
Facility Agent or the Revolving Facility Secured Parties claiming a lack of
adequate protection with respect to the Revolving Facility Priority Collateral.
Notwithstanding the foregoing provisions in this Section 4.5(d)(i), in any
Insolvency or Liquidation Proceeding, (x) if the Revolving Facility Secured
Parties (or any subset thereof) are granted adequate protection in the form of
additional collateral in the nature of assets constituting Revolving Facility
Priority Collateral in connection with any Revolving Facility DIP Financing or
use of cash collateral constituting Revolving Facility Priority Collateral, then
each of the First Lien Security Agent, on behalf of itself or any of the other
First Lien Secured Parties, and, if any Additional Second Lien Obligations have
been issued, the Second Lien Security Agent, on behalf of itself or any of the
other Second Lien Secured Parties, may seek or request adequate protection in
the form of a Lien on such additional collateral, which Lien will be
subordinated to the Liens securing the Revolving Facility Obligations and such
Revolving Facility DIP Financing (and all obligations relating thereto) on the
same basis as the other Liens on Revolving Facility Priority Collateral securing
the First Lien Obligations or Second Lien Obligations, as the case may be, are
so subordinated to the Liens securing Revolving Facility Obligations under this
Agreement, and (y) in the event the First Lien Security Agent, on behalf of
itself and the other First Lien Secured Parties, or, if any Additional Second
Lien Obligations have been issued, the Second Lien Security Agent, on behalf of
itself and the other Second Lien Secured Parties, seeks or requests adequate
protection in respect of Revolving Facility Priority Collateral securing First
Lien Obligations or Second Lien Obligations and such adequate protection is
granted in the form of additional collateral in the nature of assets
constituting Revolving Facility Priority Collateral, then each of the First Lien
Security Agent, on behalf of itself or any of the other First Lien Secured
Parties and the Second Lien Security Agent, on behalf of itself or any of the
other Second Lien Secured Parties, agrees that the Revolving Facility Agent
shall also be granted a senior Lien on such additional collateral as security
for the Revolving Facility Obligations and for any such Revolving Facility DIP
Financing and that any Lien on such additional collateral securing the First
Lien Obligations or Second Lien Obligations, as the case may be, shall be
subordinated to the Liens on such collateral securing the Revolving Facility
Obligations and any such Revolving Facility DIP Financing (and all obligations
relating thereto) and to any other Liens on such Collateral granted to the
Revolving Facility Secured Parties as adequate protection on the same basis as
the other Liens on Revolving Facility Priority Collateral securing the First
Lien Obligations and Second Lien Obligations are so subordinated to such Liens
securing Revolving Facility Obligations under this Agreement.

(ii) If any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent, on behalf of itself and the other Second Lien Secured Parties,
agrees that it shall not contest (or support any other Person contesting)
(A) any request by the First Lien Security Agent or the First Lien Secured
Parties for adequate protection or similar protection under any Debtor Relief
Law with respect to any Revolving Facility Priority Collateral or (B) any
objection by the First Lien Security Agent or the First Lien Secured Parties to
any motion, relief, action or proceeding based on the First Lien Security Agent
or the First Lien Secured Parties claiming a lack of adequate protection with
respect to the Revolving Facility Priority

 

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Collateral. Notwithstanding the foregoing provisions in this Section 4.5(d)(ii),
in any Insolvency or Liquidation Proceeding, (x) if the First Lien Secured
Parties (or any subset thereof) are granted adequate protection in the form of
additional collateral in the nature of assets constituting Revolving Facility
Priority Collateral in connection with any Revolving Facility DIP Financing or
First Lien Revolving Facility Priority Collateral DIP Financing or use of cash
collateral constituting Revolving Facility Priority Collateral or Notes Priority
Collateral, then, if any Additional Second Lien Obligations have been issued,
the Second Lien Security Agent, on behalf of itself or any of the other Second
Lien Secured Parties, may seek or request adequate protection in the form of a
Lien on such additional collateral, which Lien will be subordinated to the Liens
securing the Revolving Facility Obligations and the First Lien Obligations and
such Revolving Facility DIP Financing and such First Lien Revolving Facility
Priority Collateral DIP Financing (and all obligations relating thereto) on the
same basis as the other Liens on Revolving Facility Priority Collateral securing
the Second Lien Obligations are so subordinated to the Liens securing Revolving
Facility Obligations and First Lien Obligations under this Agreement, and (y) if
any Additional Second Lien Obligations have been issued, in the event the Second
Lien Security Agent, on behalf of itself and the other Second Lien Secured
Parties, seeks or requests adequate protection in respect of Revolving Facility
Priority Collateral securing Second Lien Obligations and such adequate
protection is granted in the form of additional collateral in the nature of
assets constituting Revolving Facility Priority Collateral, then the Second Lien
Security Agent, on behalf of itself or any of the other Second Lien Secured
Parties, agrees that the Revolving Facility Agent and the First Lien Security
Agent shall also be granted a senior Lien on such additional collateral as
security for the Revolving Facility Obligations and the First Lien Obligations
and for any such Revolving Facility DIP Financing and any such First Lien
Revolving Facility Priority Collateral DIP Financing and that any Lien on such
additional collateral securing the Second Lien Obligations shall be subordinated
to the Liens on such collateral securing the Revolving Facility Obligations and
the First Lien Obligations and any such Revolving Facility DIP Financing and any
such First Lien Revolving Facility Priority Collateral DIP Financing (and all
obligations relating thereto) and to any other Liens on such Collateral granted
to the Revolving Facility Agent and the First Lien Secured Parties as adequate
protection on the same basis as the other Liens on Revolving Facility Priority
Collateral securing the Second Lien Obligations are so subordinated to such
Liens securing the Revolving Facility Obligations and First Lien Obligations
under this Agreement.

(e) No Waiver. Subject to the proviso in clause (ii) of Section 4.1(a), nothing
contained herein shall prohibit or in any way limit the Revolving Facility Agent
or any Revolving Facility Secured Party from objecting in any Insolvency or
Liquidation Proceeding or otherwise to any action taken by the First Lien
Security Agent or any of the First Lien Secured Parties, or, if any Additional
Second Lien Obligations have been issued, the Second Lien Security Agent or any
of the Second Lien Secured Parties in respect of the Revolving Facility Priority
Collateral, including the seeking by the First Lien Security Agent, any First
Lien Secured Parties, the Second Lien Security Agent or any Second Lien Secured
Party of adequate protection in respect thereof or the asserting by the First
Lien Security Agent, any First Lien Secured Parties, the Second Lien Security
Agent or any Second Lien Secured Parties of any of its rights and remedies under
the First Lien Documents or Second Lien Documents, as the case may be, or
otherwise in respect thereof.

 

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(f) Waiver. Each of the First Lien Security Agent, for itself and on behalf of
the other First Lien Secured Parties, and, if any Additional Second Lien
Obligations have been issued the Second Lien Security Agent, for itself and on
behalf of the other Second Lien Secured Parties, waives any claim it may
hereafter have against any Revolving Facility Secured Party arising out of the
election of any Revolving Facility Secured Party of the application of
Section 1111(b)(2) of the Bankruptcy Code, and/or out of any cash collateral or
financing arrangement or out of any grant of a security interest, in each case,
in connection with the Revolving Facility Priority Collateral in any Insolvency
or Liquidation Proceeding.

4.6. Reliance; Waivers; Etc.

(a) Reliance. Other than any reliance on the terms of this Agreement, the First
Lien Security Agent, on behalf of itself and the other First Lien Secured
Parties under its First Lien Documents, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Security Agent, on behalf of
itself and the Second Lien Secured Parties under its Second Lien Documents, each
acknowledges that it and the Secured Parties under the First Lien Documents and
Second Lien Documents, respectively, have, independently and without reliance on
the Revolving Facility Agent or any Revolving Facility Secured Parties, and
based on documents and information deemed by them appropriate, made their own
credit analysis and decision to enter into the First Lien Documents and the
Second Lien Documents, respectively, and be bound by the terms of this Agreement
and they will continue to make their own credit decision in taking or not taking
any action under the First Lien Credit Agreement, any Additional Second Lien
Obligations Agreement or this Agreement.

(b) No Warranties or Liability. Each of the First Lien Security Agent, on behalf
of itself and the other First Lien Secured Parties, and, if any Additional
Second Lien Obligations have been issued, the Second Lien Security Agent, on
behalf of itself and the other Second Lien Secured Parties, acknowledges and
agrees that the Revolving Facility Agent and the Revolving Facility Secured
Parties have made no express or implied representation or warranty, including
with respect to the execution, validity, legality, completeness, collectability
or enforceability of any of the Revolving Facility Documents, the ownership of
any Collateral or the perfection or priority of any Liens thereon. The Revolving
Facility Secured Parties will be entitled to manage and supervise their
respective loans and extensions of credit under their respective Revolving
Facility Documents in accordance with law and as they may otherwise, in their
sole discretion, deem appropriate. The Revolving Facility Agent and the
Revolving Facility Secured Parties shall have no duty to the First Lien Security
Agent, any of the First Lien Secured Parties, the Second Lien Security Agent or
the Second Lien Secured Parties to act or refrain from acting in a manner which
allows, or results in, the occurrence or continuance of an event of default or
default under any agreements with the Company or any other Grantor (including
the Revolving Facility Documents, the First Lien Documents and the Second Lien
Documents), regardless of any knowledge thereof which they may have or be
charged with.

(c) No Waiver of Lien Priorities – Revolving Facility Obligations.

(i) No right of the Revolving Facility Secured Parties, the Revolving Facility
Agent or any of them to enforce any provision of this Agreement or any Revolving
Facility

 

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Document shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or any other Grantor or by any act or
failure to act by any Revolving Facility Secured Party or the Revolving Facility
Agent, or by any noncompliance by any Person with the terms, provisions and
covenants of this Agreement, any of the Revolving Facility Documents, any of the
First Lien Documents of any of the Second Lien Documents, regardless of any
knowledge thereof which the Revolving Facility Agent or the Revolving Facility
Secured Parties, or any of them, may have or be otherwise charged with.

(ii) Without in any way limiting the generality of the foregoing paragraph (but
subject to the rights of the Company and the other Grantors under the Revolving
Facility Documents and subject to the provisions of Section 4.5(b)), the
Revolving Facility Secured Parties, the Revolving Facility Agent and any of them
may, at any time and from time to time in accordance with the Revolving Facility
Documents and/or applicable law, without the consent of, or notice to, the First
Lien Security Agent, any First Lien Secured Party, the Second Lien Security
Agent or any Second Lien Secured Party, without incurring any liabilities to the
First Lien Security Agent, any First Lien Secured Parties, any Second Lien
Secured Party or the Second Lien Security Agent and without impairing or
releasing the Lien priorities and other benefits provided in this Agreement
(even if any right of subrogation or other right or remedy of the First Lien
Security Agent, any First Lien Secured Party, the Second Lien Security Agent or
any Second Lien Secured Party is affected, impaired or extinguished thereby) do
any one or more of the following:

(A) make loans and advances to any Grantor or issue, guaranty or obtain letters
of credit for account of any Grantor or otherwise extend credit to any Grantor,
in any amount and on any terms, whether pursuant to a commitment or as a
discretionary advance and whether or not any default or event of default or
failure of condition is then continuing;

(B) change the manner, place or terms of payment or change or extend the time of
payment of, or amend, renew, exchange, increase or alter, the terms of any of
the Revolving Facility Obligations or any Lien on any Revolving Facility
Priority Collateral or guaranty thereof or any liability of the Company or any
other Grantor, or any liability incurred directly or indirectly in respect
thereof (including any increase in or extension of the Revolving Facility
Obligations, without any restriction as to the amount, tenor or terms of any
such increase or extension) or otherwise amend, renew, exchange, extend, modify
or supplement in any manner any Liens on the Revolving Facility Priority
Collateral held by the Revolving Facility Agent or any of the Revolving Facility
Secured Parties, the Revolving Facility Obligations or any of the Revolving
Facility Documents;

(C) sell, exchange, realize upon, enforce or otherwise deal with in any manner
(subject to the terms hereof) and in any order any part of the Revolving
Facility Priority Collateral or any liability of the Company or any other
Grantor to the Revolving Facility Secured Parties or the Revolving Facility
Agent;

 

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(D) settle or compromise any Revolving Facility Obligation or any other
liability of the Company or any other Grantor or any Revolving Facility Priority
Collateral; and

(E) exercise or delay in or refrain from exercising any right or remedy against
the Company or any other Grantor or any other Person, elect any remedy and
otherwise deal freely with the Company, any other Grantor or any Revolving
Facility Priority Collateral or any liability incurred directly or indirectly in
respect thereof.

(iii) Each of the First Lien Security Agent, on behalf of itself and the other
First Lien Secured Parties, and, if any Additional Second Lien Obligations have
been issued, the Second Lien Security Agent, on behalf of itself and the other
Second Lien Secured Parties, also agrees that the Revolving Facility Secured
Parties and the Revolving Facility Agent shall have no liability to the First
Lien Security Agent, any First Lien Secured Party, the Second Lien Security
Agent or any Second Lien Secured Party and the First Lien Security Agent, on
behalf of itself and the other First Lien Secured Parties, and the Second Lien
Security Agent, on behalf of itself and the other Second Lien Secured Parties,
hereby waives any claim against any Revolving Facility Secured Party or the
Revolving Facility Agent, arising out of any and all actions which the Revolving
Facility Secured Parties or the Revolving Facility Agent may take or permit or
omit to take with respect to:

(A) the Revolving Facility Documents (other than this Agreement), including any
failure to perfect or obtain perfected security interests in the Revolving
Facility Priority Collateral;

(B) the collection of the Revolving Facility Obligations; or

(C) the foreclosure upon, or sale, liquidation or other disposition of, any
Revolving Facility Priority Collateral.

Each of the First Lien Security Agent, on behalf of itself and the other First
Lien Secured Parties, and, if any Additional Second Lien Obligations have been
issued, the Second Lien Security Agent, on behalf of itself and the other Second
Lien Secured Parties, agrees that the Revolving Facility Secured Parties and the
Revolving Facility Agent have no duty to the First Lien Security Agent, the
First Lien Secured Parties, the Second Lien Security Agent or the Second Lien
Secured Parties in respect of the maintenance or preservation of the Revolving
Facility Priority Collateral, the Revolving Facility Obligations or otherwise.

(iv) Each of the First Lien Security Agent, on behalf of itself and the other
First Lien Secured Parties, and, if any Additional Second Lien Obligations have
been issued the Second Lien Security Agent, on behalf of itself and the other
Second Lien Secured Parties, agrees not to assert and hereby waives, to the
fullest extent permitted by law, any right to demand, request, plead or
otherwise assert or otherwise claim the benefit of, any marshalling, appraisal,
valuation or other similar right that may otherwise be available under
applicable law with respect to the Revolving Facility Priority Collateral or any
other similar rights a junior secured creditor may have under applicable law.

 

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Section 5. General.

5.1. Legends. The Grantors agree that each Security Document shall include the
following language (with any necessary modifications to give effect to
applicable definitions) (or language to similar effect approved by the Directing
Security Agents):

“Notwithstanding anything herein to the contrary, the Liens and security
interests granted to the [Revolving Facility Agent] [First Lien Security Agent]
[Second Lien Security Agent] pursuant to this Agreement in any Collateral and
the exercise of any right or remedy by the [Revolving Facility Agent] [First
Lien Security Agent] [Second Lien Security Agent] with respect to any Collateral
hereunder are subject to the provisions of the Intercreditor Agreement, dated as
of March 17, 2014 (as amended, restated, supplemented or otherwise modified from
time to time, the “Intercreditor Agreement”), among Interline Brands, Inc., a
New Jersey corporation, Interline Brands, Inc., a Delaware corporation, the
other Grantors from time to time party hereto, Bank of America, N.A., as
Revolving Facility Agent and Barclays Bank PLC, as First Lien Administrative
Agent and as First Lien Security Agent and certain other Persons party or that
may become party thereto from time to time. In the event of any conflict between
the terms of the Intercreditor Agreement and this Agreement, the terms of the
Intercreditor Agreement shall govern and control.”

In addition, the Grantors agree that each mortgage or deed of trust in favor of
any Secured Parties covering any Collateral shall also contain such other
language as a Security Agent may reasonably request to reflect the subordination
of such mortgage to the mortgage in favor of such Security Agent on behalf of
the applicable Secured Parties covering such Collateral. Notwithstanding the
foregoing, the foregoing language shall not be required to be included in any
Security Document, mortgage or deed of trust entered into prior to the date
hereof; provided that, if any such Security Document, mortgage or deed of trust
is amended or replaced on or after the date hereof, the foregoing language shall
be added thereto as part of such amendment or replacement.

5.2. Reorganization Securities. If, in any Insolvency or Liquidation Proceeding,
debt obligations of the reorganized debtor secured by Liens upon any property of
the reorganized debtor are distributed, pursuant to a plan of reorganization or
similar dispositive restructuring plan, on account of any two or more of the
First Lien Obligations, the Second Lien Obligations and the Revolving Facility
Obligations, then, to the extent the debt obligations distributed on account of
such First Lien Obligations, such Second Lien Obligations or such Revolving
Facility Obligations are secured by Liens upon the same property, the provisions
of this Agreement will survive the distribution of such debt obligations
pursuant to such plan and will apply with like effect to the Liens securing such
debt obligations.

5.3. Post-Petition Interest.

(a) None of the Revolving Facility Agent or any Revolving Facility Secured
Party, or, if any Additional Second Lien Obligations have been issued, the
Second Lien Security Agent or any Second Lien Secured Party shall oppose or seek
to challenge any claim by the First

 

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Lien Security Agent or any First Lien Secured Party for allowance in any
Insolvency or Liquidation Proceeding of First Lien Obligations consisting of
post-petition interest, fees or expenses to the extent of the value of the First
Lien Secured Party’s Lien on the Notes Priority Collateral (without regard to
the existence of the junior Liens of the Revolving Facility Agent on behalf of
the Revolving Facility Secured Parties or the Second Lien Security Agent, on
behalf of the Second Lien Secured Parties, as the case may be, on the Notes
Priority Collateral) or the Revolving Facility Priority Collateral (after taking
into account the senior Lien of the Revolving Facility Agent on behalf of the
Revolving Facility Secured Parties on the Revolving Facility Priority
Collateral, but without regard to the existence of the junior Lien of the Second
Lien Security Agent, on behalf of the Second Lien Secured Parties, as the case
may be, on the Revolving Facility Priority Collateral).

(b) None of the First Lien Security Agent or any First Lien Secured Party, or,
if any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent or any Second Lien Secured Party shall oppose or seek to
challenge any claim by the Revolving Facility Agent or any Revolving Facility
Secured Party for allowance in any Insolvency or Liquidation Proceeding of
Revolving Facility Obligations consisting of post-petition interest, fees or
expenses to the extent of the value of the Lien of the Revolving Facility Agent
on behalf of the Revolving Facility Secured Parties on the Notes Priority
Collateral (after taking into account the senior Liens of the First Lien
Security Agent, on behalf of the First Lien Secured Parties and the Second Lien
Security Agent, on behalf of the Second Lien Secured Parties, as the case may
be, on the Notes Priority Collateral) or the Revolving Facility Priority
Collateral (without regard to the existence of the junior Liens of the First
Lien Security Agent, on behalf of the First Lien Secured Parties, or the Second
Lien Security Agent, on behalf of the Second Lien Secured Parties, on the
Revolving Facility Priority Collateral).

5.4. Obligations Unconditional. All rights, interests, agreements and
obligations of the First Lien Security Agent and the First Lien Secured Parties,
and, if any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent and the Second Lien Secured Parties, and the Revolving Facility
Agent and the Revolving Facility Secured Parties, respectively, hereunder shall
remain in full force and effect irrespective of:

(i) any lack of validity or enforceability of any First Lien Document, any
Second Lien Document or any Revolving Facility Document;

(ii) except as otherwise set forth in the Agreement, any change in the time,
manner or place of payment of, or in any other terms of, all or any of the First
Lien Obligations, Second Lien Obligations or Revolving Facility Obligations, or
any amendment or waiver or other modification, whether by course of conduct or
otherwise, of the terms of any First Lien Document, Second Lien Document or any
Revolving Facility Document;

(iii) except as otherwise set forth in the Agreement, any exchange of any
security interest in any Notes Priority Collateral or any Revolving Facility
Priority Collateral or any amendment, waiver or other modification, whether in
writing or by course of conduct or otherwise, of all or any of the First Lien
Obligations, Second Lien Obligations or Revolving Facility Obligations;

 

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(iv) the commencement of any Insolvency or Liquidation Proceeding in respect of
the Company or any other Grantor; or

(v) any other circumstances which otherwise might constitute a defense available
to, or a discharge of, the Company or any other Grantor in respect of the First
Lien Obligations, Second Lien Obligations or Revolving Facility Obligations or
of the Revolving Facility Agent, any Revolving Facility Secured Party, the First
Lien Security Agent, any First Lien Secured Party, the Second Lien Security
Agent or any Second Lien Secured Party in respect of this Agreement.

 

Section 6. Cooperation With Respect To Revolving Facility Priority Collateral.

6.1. Consent to License to Use Intellectual Property. Each of the First Lien
Security Agent and, if any Additional Second Lien Obligations have been issued,
the Second Lien Security Agent on behalf of the First Lien Secured Parties and
the Second Lien Secured Parties respectively (and any purchaser, assignee or
transferee of assets as provided in Section 6.3) (a) consents (without any
representation, warranty or obligation whatsoever) to the grant by any Grantor
to the Revolving Facility Agent of a non-exclusive royalty-free license to use,
subject to any limitations and restrictions in any relevant Security Document
for a period not to exceed 180 days (commencing with the initiation of any
enforcement of Liens by any of the First Lien Security Agent or the Second Lien
Security Agent (provided, in each case, that the Revolving Facility Agent has
received notice thereof) or the Revolving Facility Agent) any Intellectual
Property of such Grantor that is subject to a Lien held by either the First Lien
Security Agent or the Second Lien Security Agent, respectively (or any
Intellectual Property acquired by such purchaser, assignee or transferee from
any Grantor, as the case may be) and (b) grants, in its capacity as a secured
party (or as a purchaser, assignee or transferee, as the case may be), to the
Revolving Facility Agent a non-exclusive royalty-free license to use for a
period not to exceed 180 days (commencing with (x) the initiation of any
enforcement of Liens by any of the First Lien Security Agent, the Second Lien
Security Agent or the Revolving Facility Agent or (y) the purchase, assignment
or transfer, as the case may be (provided, in each case, that the Revolving
Facility Agent has received notice thereof)) any Intellectual Property that is
subject to a Lien held by the First Lien Security Agent or the Second Lien
Security Agent (or subject to such purchase, assignment or transfer, as the case
may be), in each case in connection with the enforcement of any Lien held by the
Revolving Facility Agent upon any Inventory or other Revolving Facility Priority
Collateral of any Grantor and to the extent the use of such Intellectual
Property is necessary or appropriate, in the good faith opinion of the Revolving
Facility Agent, to process, ship, collect, produce, store, complete, supply,
lease, sell or otherwise dispose of any such Inventory or other Revolving
Facility Priority Collateral in any lawful manner. The 180 day license periods
shall be tolled during the pendency of any Insolvency or Liquidation Proceeding
of any Grantor pursuant to which the Revolving Facility Agent is effectively
stayed from enforcing its rights and remedies with respect to the Revolving
Facility Priority Collateral.

6.2. Access to Information. If either the First Lien Security Agent or the
Second Lien Security Agent takes actual possession of any documentation of a
Grantor (whether such documentation is in the form of a writing or is stored in
any computer, data equipment or data record in the physical possession of the
First Lien Security Agent or the Second Lien Security

 

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Agent), then upon the reasonable request of the Revolving Facility Agent and
reasonable advance notice, the First Lien Security Agent or Second Lien Security
Agent, as the case may be, will permit the Revolving Facility Agent or its
representative to inspect, use and copy such documentation.

6.3. Access to Property. (a) (i) If the Revolving Facility Agent commences any
action or proceeding with respect to any of its rights or remedies (including,
but not limited to, any action of foreclosure but excluding any exercise of
rights solely in connection with cash dominion), enforcement, collection or
execution with respect to the Revolving Facility Priority Collateral (“Revolving
Facility Priority Collateral Enforcement Actions”) or if either of the First
Lien Security Agent or the Second Lien Security Agent commences any action or
proceeding with respect to any of its rights or remedies (including any action
of foreclosure), enforcement, collection or execution with respect to the Notes
Priority Collateral, and the First Lien Security Agent or the Second Lien
Security Agent, as the case may be (or a purchaser at a foreclosure sale
conducted in foreclosure of any Liens of the First Lien Security Agent or the
Second Lien Security Agent or negotiated sale in lieu thereof) takes actual or
constructive possession of Notes Priority Collateral of any Grantor (“Notes
Priority Collateral Enforcement Actions”), then the First Lien Secured Parties
and the First Lien Security Agent, and, if any Additional Second Lien
Obligations have been issued, the Second Lien Secured Parties and the Second
Lien Security Agent, as the case may be, shall (subject to, in the case of any
Notes Priority Collateral Enforcement Action, a prior written request by the
Revolving Facility Agent to the First Lien Security Agent or the Second Lien
Security Agent, as the case may be (the “Notes Priority Collateral Enforcement
Action Notice”)) (x) cooperate with the Revolving Facility Agent (and with its
officers, employees, representatives and agents) in its efforts to conduct
Revolving Facility Priority Collateral Enforcement Actions in the Revolving
Facility Priority Collateral and to finish any work-in-process and collect,
process, ship, produce, store, complete, supply, lease, sell or otherwise
handle, deal with, assemble or dispose of, in any lawful manner, the Revolving
Facility Priority Collateral, (y) not hinder or restrict in any respect the
Revolving Facility Agent from conducting Revolving Facility Priority Collateral
Enforcement Actions in the Revolving Facility Priority Collateral or from
finishing any work-in-process or collecting, processing, shipping, producing,
storing, completing, supplying, leasing, selling or otherwise handling, dealing
with, assembling or disposing of, in any lawful manner, the Revolving Facility
Priority Collateral, and (z) permit the Revolving Facility Agent, its employees,
agents, advisers and representatives, at the cost and expense of the Revolving
Facility Secured Parties, to enter upon and use the Notes Priority Collateral
(including equipment, processors, computers and other machinery related to the
storage or processing of records, documents or files and intellectual property),
for a period (I) commencing on the date of the initial Revolving Facility
Priority Collateral Enforcement Action or the date of delivery of the Notes
Priority Collateral Enforcement Action Notice, as the case may be, and (II)
ending on the earlier of the date occurring 180 days thereafter and the date on
which all Revolving Facility Priority Collateral (other than Revolving Facility
Priority Collateral abandoned by the Revolving Facility Agent in writing) has
been removed from the Notes Priority Collateral (such period, the “Revolving
Facility Priority Collateral Processing and Sale Period”), for purposes of:

(A) assembling and storing the Revolving Facility Priority Collateral and
completing the processing of and turning into finished goods any Revolving
Facility Priority Collateral consisting of work-in-process or raw materials;

 

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(B) selling any or all of the Revolving Facility Priority Collateral located in
or on such Notes Priority Collateral, whether in bulk, in lots or to customers
in the ordinary course of business or otherwise;

(C) removing and transporting any or all of the Revolving Facility Priority
Collateral located in or on such Notes Priority Collateral;

(D) otherwise collecting, processing, shipping, producing, storing, completing,
supplying, leasing, selling or otherwise handling, dealing with, assembling or
disposing of, in any lawful manner, the Revolving Facility Priority Collateral;
and/or

(E) taking reasonable actions to protect, secure, and otherwise enforce the
rights or remedies of the Revolving Facility Secured Parties and/or the
Revolving Facility Agent (including with respect to any Revolving Facility
Priority Collateral Enforcement Actions) in and to the Revolving Facility
Priority Collateral; provided, however, that nothing contained in this Agreement
shall restrict the rights of the First Lien Security Agent or, if any Additional
Second Lien Obligations have been issued, the Second Lien Security Agent from
selling, assigning or otherwise transferring any Notes Priority Collateral prior
to the expiration of such Revolving Facility Priority Collateral Processing and
Sale Period if the purchaser, assignee or transferee thereof agrees in writing
(for the benefit of the Revolving Facility Agent and the Revolving Facility
Secured Parties) to be bound by the provisions of this Section 6. If any stay or
other order prohibiting the exercise of remedies with respect to the Revolving
Facility Priority Collateral has been entered by a court of competent
jurisdiction, such Revolving Facility Priority Collateral Processing and Sale
Period shall be tolled during the pendency of any such stay or other order.

(ii) During the period of actual occupation, use and/or control by the Revolving
Facility Secured Parties and/or the Revolving Facility Agent (or their
respective employees, agents, advisers and representatives) of any Notes
Priority Collateral, the Revolving Facility Secured Parties and the Revolving
Facility Agent shall be obligated to repair at their expense any physical damage
to such Notes Priority Collateral resulting from such occupancy, use or control,
and to leave such Notes Priority Collateral in substantially the same condition
as it was at the commencement of such occupancy, use or control, ordinary wear
and tear excepted. Notwithstanding the foregoing, in no event shall the
Revolving Facility Secured Parties or the Revolving Facility Agent have any
liability to the First Lien Secured Parties, the First Lien Security Agent, the
Second Lien Secured Parties or the Second Lien Security Agent pursuant to this
Section 6.3(a) as a result of any condition (including any environmental
condition, claim or liability) on or with respect to the Notes Priority
Collateral existing prior to the date of the exercise by the Revolving Facility
Secured Parties (or the Revolving Facility Agent, as the case may be) of their
rights under this Section 6.3(a) and the Revolving Facility Secured Parties
shall have no duty or liability to maintain the Notes Priority Collateral in a
condition or manner better

 

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than that in which it was maintained prior to the use thereof by the Revolving
Facility Secured Parties, or for any diminution in the value of the Notes
Priority Collateral that results from ordinary wear and tear resulting from the
use of the Notes Priority Collateral by the Revolving Facility Secured Parties
in the manner and for the time periods specified under this Section 6.3(a) or as
a result of the removal of the Revolving Facility Priority Collateral. Without
limiting the rights granted in this Section 6.3(a), the Revolving Facility
Secured Parties and the Revolving Facility Agent shall cooperate with the First
Lien Secured Parties, the First Lien Security Agent, the Second Lien Secured
Parties and the Second Lien Security Agent in connection with any efforts made
by the First Lien Secured Parties, the First Lien Security Agent, the Second
Lien Secured Parties and the Second Lien Security Agent to sell the Notes
Priority Collateral.

(b) The Revolving Facility Secured Parties shall (i) use the Notes Priority
Collateral in accordance with applicable law and (ii) indemnify the First Lien
Secured Parties and the Second Lien Secured Parties from any claim, loss,
damage, cost or liability arising out of any claim asserted by any third party
as a result of any acts or omissions by the Revolving Facility Security Agent,
or any of its agents or representatives, in connection with the exercise by the
Revolving Facility Secured Parties of their rights of access set forth in this
Section 6.3. In no event shall any Revolving Facility Secured Party have any
liability to the First Lien Secured Parties or the Second Lien Secured Parties
pursuant to this Section 6.3(b) or otherwise as a result of any condition on or
with respect to the Notes Priority Collateral existing prior to the date of the
exercise by the Revolving Facility Secured Parties of their access rights under
this Section 6.3(b), and the Revolving Facility Secured Parties shall have no
duty or liability to maintain the Notes Priority Collateral in a condition or
manner better than that in which it was maintained prior to the access and/or
use thereof by the Revolving Facility Secured Parties.

(c) Each of the First Lien Security Agent and the Second Lien Security Agent
(x) shall, at the request of the Revolving Facility Agent, provide reasonable
cooperation to the Revolving Facility Agent in connection with the manufacture,
production, completion, handling, removal and sale of any Revolving Facility
Priority Collateral by the Revolving Facility Agent as provided above and
(y) shall be entitled to receive, from the Revolving Facility Agent,
reimbursement for their reasonable out-of-pocket costs and expenses incurred in
connection with such cooperation, support and assistance to the Revolving
Facility Agent. Each of the First Lien Security Agent and the Second Lien
Security Agent and/or any such purchaser (or its transferee or successor) shall
not be required to manufacture, produce, complete, remove, insure, protect,
store, safeguard, sell or deliver any inventory subject to any First Priority
Lien held by the Revolving Facility Agent.

6.4. Grantor Consent. The Company and the other Grantors consent to the
performance by each of the First Lien Security Agent and the Second Lien
Security Agent of the obligations set forth in this Section 6 and acknowledge
and agree that neither the First Lien Security Agent (nor any First Lien Secured
Party) nor the Second Lien Security Agent (nor any Second Lien Secured Party)
shall ever be accountable or liable for any action taken or omitted by the
Revolving Facility Agent or any Revolving Facility Secured Party or its or any
of their officers, employees, agents, successors or assigns in connection
therewith or incidental thereto or in consequence thereof.

 

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6.5. Exercise of Cash Dominion; Funds Deposited in Controlled Securities
Accounts and Deposit Accounts. Each of the First Lien Security Agent, for itself
and on behalf of the other First Lien Secured Parties, and, if any Additional
Second Lien Obligations have been issued, the Second Lien Security Agent, for
itself and on behalf of the other Second Lien Secured Parties, hereby
acknowledges and agrees that (a) the exercise of cash dominion by the Revolving
Facility Agent over any Securities Account or Deposit Account of any Grantor and
application of funds in connection therewith to the Revolving Facility
Obligations shall not constitute an exercise of rights or remedies by the
Revolving Facility Agent for purposes of this Agreement and (b) all funds
deposited in controlled Securities Accounts or Deposit Accounts and then applied
to the Revolving Facility Obligations shall be treated as Revolving Facility
Priority Collateral, and any claims that such funds constitute Notes Priority
Collateral are waived except (i) to the extent that the Revolving Facility Agent
has received written notice of an enforcement action under any First Lien
Document or Second Lien Document and written notice prior to the application of
such funds to the Revolving Facility Obligations that such funds constitute
Proceeds of Notes Priority Collateral or (ii) during an Insolvency or
Liquidation Proceeding.

 

Section 7. Application Of Proceeds.

7.1. Application of Proceeds in Distributions by the First Lien Security Agent.

(a) The First Lien Security Agent will apply the Proceeds of any Notes Priority
Collateral Enforcement Actions and, after the Discharge of Revolving Facility
Obligations, the Proceeds of any collection, sale, foreclosure or other
realization of any Revolving Facility Priority Collateral by First Lien Security
Agent as expressly permitted hereunder, and, in each case, the Proceeds of any
title insurance policy insuring any Notes Priority Collateral (or, after the
Discharge of Revolving Facility Obligations, any Revolving Facility Priority
Collateral) required under any First Lien Document or Revolving Facility
Document, in the following order of application:

First, to the payment of all amounts payable under the First Lien Documents on
account of the First Lien Security Agent’s or any Additional First Lien
Obligations Agent’s fees and any reasonable legal fees, costs and expenses or
other liabilities of any kind incurred by the First Lien Security Agent, any
Additional First Lien Obligations Agent or any co-trustee or agent of the First
Lien Security Agent or any Additional First Lien Obligations Agent in connection
with any First Lien Document;

Second, to the First Lien Administrative Agent and any Additional First Lien
Obligations Agent, administrative agent or trustee for the Additional First Lien
Obligations for application to the payment of all outstanding First Lien
Priority Obligations in such order as may be provided in the First Lien
Documents in an amount sufficient to result in Discharge of First Lien
Obligations;

Third, if any Additional Second Lien Obligations have been issued, to the
payment of all amounts payable under the Second Lien Documents on account of the
Second Lien Security Agent’s or any Additional Second Lien Obligations Agent’s
fees and any reasonable legal fees, costs and expenses or other liabilities of
any kind incurred by the Second Lien Security Agent, any Additional Second Lien
Obligations Agent or any co-trustee or agent of the Second Lien Security Agent
or any Additional Second Lien Obligations Agent in connection with any Second
Lien Document;

 

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Fourth, if any Additional Second Lien Obligations have been issued, to the
Additional Second Lien Obligations Agent, administrative agent or trustee for
the Second Lien Obligations for application to the payment of all outstanding
Second Lien Priority Obligations in such order as may be provided in the Second
Lien Documents in an amount sufficient to result in Discharge of Second Lien
Obligations;

Fifth, to the payment of all amounts payable under the Revolving Facility
Documents on account of the Revolving Facility Agent’s fees and any reasonable
legal fees, costs and expenses or other liabilities of any kind incurred by the
Revolving Facility Agent or any co-trustee or agent of the Revolving Facility
Agent in connection with any Revolving Facility Document;

Sixth, to the Revolving Facility Agent for application to the payment of all
outstanding Revolving Facility Priority Obligations in such order as may be
provided in the Revolving Facility Documents in an amount sufficient to result
in Discharge of Revolving Facility Obligations; and

Seventh, to the First Lien Administrative Agent and any Additional First Lien
Obligations Agent, administrative agent or trustee for the Additional First Lien
Obligations for application to the payment of all outstanding Excess First Lien
Obligations that are then due and payable in such order as may be provided in
the First Lien Documents in an amount sufficient to pay in full in cash all
outstanding Excess First Lien Obligations that are then due and payable;

Eighth, if any Additional Second Lien Obligations have been issued, to the
Additional Second Lien Obligations Agent, administrative agent or trustee for
the Second Lien Obligations for application to the payment of all outstanding
Excess Second Lien Obligations that are then due and payable in such order as
may be provided in the Second Lien Documents in an amount sufficient to pay in
full in cash all outstanding Excess Second Lien Obligations that are then due
and payable;

Ninth, to the Revolving Facility Agent for application to the payment of all
outstanding Excess Revolving Facility Obligations that are then due and payable
in such order as may be provided in the Revolving Facility Documents in an
amount sufficient to pay in full in cash all outstanding Excess Revolving
Facility Obligations that are then due and payable; and

Tenth, any surplus remaining after the payment in full in cash of the amounts
described in the preceding clauses will be paid to the Company or the applicable
Grantor, as the case may be, its successors or assigns, or as a court of
competent jurisdiction may direct.

(b) In connection with the application of Proceeds pursuant to Section 7.1(a),
except as otherwise directed by the Required Lenders (or equivalent term) under
(and as defined in) the First Lien Documents, the First Lien Security Agent may
sell any non-Cash Proceeds for cash prior to the application of the Proceeds
thereof.

 

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(c) If the First Lien Security Agent or any First Lien Secured Party collects or
receives any Proceeds of Revolving Facility Priority Collateral in connection
with such Notes Priority Collateral Enforcement Action that should have been
applied to the payment of the Revolving Facility Obligations in accordance with
Section 7.2(a), whether after the commencement of an Insolvency or Liquidation
Proceeding or otherwise, such First Lien Secured Party will forthwith deliver
the same to the Revolving Facility Agent, for the account of the holders of the
Revolving Facility Obligations, to be applied in accordance with Section 7.2(a).
Until so delivered, such Proceeds will be held by that First Lien Secured Party
for the benefit of the holders of the Revolving Facility Obligations.

7.2. Application of Proceeds in Distributions by the Revolving Facility Agent.

(a) The Revolving Facility Agent will apply the Proceeds of any Revolving
Facility Priority Collateral Enforcement Actions and, after the Discharge of
First Lien Obligations and, if any Additional Second Lien Obligations have been
issued, the Discharge of Second Lien Obligations, the Proceeds of any
collection, sale, foreclosure or other realization of any Notes Priority
Collateral by the Revolving Facility Agent as expressly permitted hereunder, and
the Proceeds of any title insurance policy insuring any Revolving Facility
Priority Collateral (and, after the Discharge of First Lien Obligations and, if
any Additional Second Lien Obligations have been issued, the Discharge of Second
Lien Obligations, any title insurance insuring any Notes Priority Collateral)
required under any Revolving Facility Document permitted to be received by it,
in the following order of application:

First, to the payment of all amounts payable under the Revolving Facility
Documents on account of the Revolving Facility Agent’s fees and any reasonable
legal fees, costs and expenses or other liabilities of any kind incurred by the
Revolving Facility Agent or any co-trustee or agent of the Revolving Facility
Agent in connection with any Revolving Facility Document;

Second, to the Revolving Facility Agent for application to the payment of all
outstanding Revolving Facility Priority Obligations in such order as may be
provided in the Revolving Facility Documents in an amount sufficient to result
in Discharge of Revolving Facility Obligations;

Third, to the payment of all amounts payable under the First Lien Documents on
account of the First Lien Security Agent’s or any Additional First Lien
Obligations Agent’s fees and any reasonable legal fees, costs and expenses or
other liabilities of any kind incurred by the First Lien Security Agent, any
Additional First Lien Obligations Agent or any co-trustee or agent of the First
Lien Security Agent or any Additional First Lien Obligations Agent in connection
with any First Lien Document;

Fourth, to the First Lien Administrative Agent and any Additional First Lien
Obligations Agent, administrative agent or trustee for the Additional First Lien
Obligations for application to the payment of all outstanding First Lien
Priority Obligations in such order as may be provided in the First Lien
Documents in an amount sufficient to result in Discharge of First Lien
Obligations;

 

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Fifth, if any Additional Second Lien Obligations have been issued, to the
payment of all amounts payable under the Second Lien Documents on account of the
Second Lien Security Agent’s or any Additional Second Lien Obligations Agent’s
fees and any reasonable legal fees, costs and expenses or other liabilities of
any kind incurred by the Second Lien Security Agent, any Additional Second Lien
Obligations Agent or any co-trustee or agent of the Second Lien Security Agent
or any Additional Second Lien Obligations Agent in connection with any Second
Lien Document;

Sixth, if any Additional Second Lien Obligations have been issued, to the
Additional Second Lien Obligations Agent, administrative agent or trustee for
the Second Lien Obligations for application to the payment of all outstanding
Second Lien Priority Obligations in such order as may be provided in the Second
Lien Documents in an amount sufficient to result in Discharge of Second Lien
Obligations;

Seventh, to the Revolving Facility Agent for application to the payment of all
outstanding Excess Revolving Facility Obligations that are then due and payable
in such order as may be provided in the Revolving Facility Documents in an
amount sufficient to pay in full in cash all outstanding Excess Revolving
Facility Obligations that are then due and payable;

Eighth, to the First Lien Administrative Agent and any Additional First Lien
Obligations Agent, administrative agent or trustee for the Additional First Lien
Obligations for application to the payment of all outstanding Excess First Lien
Obligations that are then due and payable in such order as may be provided in
the First Lien Documents in an amount sufficient to pay in full in cash all
outstanding Excess First Lien Obligations that are then due and payable;

Ninth, if any Additional Second Lien Obligations have been issued, to the
Additional Second Lien Obligations Agent, administrative agent or trustee for
the Second Lien Obligations for application to the payment of all outstanding
Excess Second Lien Obligations that are then due and payable in such order as
may be provided in the Second Lien Documents in an amount sufficient to pay in
full in cash all outstanding Excess Second Lien Obligations that are then due
and payable; and

Tenth, any surplus remaining after the payment in full in cash of the amounts
described in the preceding clauses will be paid to the Company or the other
applicable Grantor, as the case may be, its successors or assigns, or as a court
of competent jurisdiction may direct.

(b) In connection with the application of Proceeds pursuant to Section 7.2(a),
except as otherwise directed by the Required Lenders (or equivalent term) under
(and as defined in) the Revolving Facility Documents, the Revolving Facility
Agent may sell any non-Cash Proceeds for cash prior to the application of the
Proceeds thereof.

 

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(c) If the Revolving Facility Agent or any Revolving Facility Secured Party
collects or receives any Proceeds of Notes Priority Collateral in connection
with such Revolving Facility Priority Collateral Enforcement Action that should
have been applied to the payment of the First Lien Obligations in accordance
with Section 7.1(a), or the Second Lien Obligations in accordance with
Section 7.3(a), whether after the commencement of an Insolvency or Liquidation
Proceeding or otherwise, such Revolving Facility Secured Party will forthwith
deliver the same to the First Lien Security Agent or the Second Lien Security
Agent, as the case may be, for the account of the holders of the First Lien
Obligations or the Second Lien Obligations, as the case may be, to be applied in
accordance with Section 7.1(a) or Section 7.3(a), as the case may be. Until so
delivered, such Proceeds will be held by that Revolving Facility Secured Party
for the benefit of the holders of the First Lien Obligations or the Second Lien
Obligation, as the case may be.

7.3. Application of Proceeds in Distributions by the Second Lien Security Agent.

(a) If any Additional Second Lien Obligations have been issued, the Second Lien
Security Agent will, after the Discharge of First Lien Obligations, apply the
Proceeds of any Notes Priority Collateral Enforcement Action and, after the
Discharge of Revolving Facility Obligations and the Discharge of First Lien
Obligations, the Proceeds of any collection, sale, foreclosure or other
realization of any Revolving Facility Priority Collateral by the Second Lien
Security Agent as expressly permitted hereunder, and, in each case the Proceeds
of any title insurance policy insuring any Notes Priority Collateral (or, after
the Discharge of Revolving Facility Obligation, any Revolving Facility Priority
Collateral) required under any Second Lien Document, in the following order of
application:

First, to the payment of all amounts payable under the Second Lien Documents on
account of the Second Lien Security Agent’s or any Additional Second Lien
Obligations Agent’s fees and any reasonable legal fees, costs and expenses or
other liabilities of any kind incurred by the Second Lien Security Agent, any
Additional Second Lien Obligations Agent or any co-trustee or agent of the
Second Lien Security Agent or any Additional Second Lien Obligations Agent in
connection with any Second Lien Document;

Second, to the Additional Second Lien Obligations Agent, administrative agent or
trustee for the Second Lien Obligations for application to the payment of all
outstanding Second Lien Priority Obligations in such order as may be provided in
the Second Lien Documents in an amount sufficient to result in Discharge of
Second Lien Obligations;

Third, to the payment of all amounts payable under the Revolving Facility
Documents on account of the Revolving Facility Agent’s fees and any reasonable
legal fees, costs and expenses or other liabilities of any kind incurred by the
Revolving Facility Agent or any co-trustee or agent of the Revolving Facility
Agent in connection with any Revolving Facility Document;

Fourth, to the Revolving Facility Agent for application to the payment of all
outstanding Revolving Facility Priority Obligations in such order as may be
provided in the Revolving Facility Documents in an amount sufficient to result
in Discharge of Revolving Facility Obligations;

 

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Fifth, to the First Lien Administrative Agent and any Additional First Lien
Obligations Agent, administrative agent or trustee for the Additional First Lien
Obligations for application to the payment of all outstanding Excess First Lien
Obligations that are then due and payable in such order as may be provided in
the First Lien Documents in an amount sufficient to pay in full in cash all
outstanding Excess First Lien Obligations that are then due and payable;

Sixth, to the Additional Second Lien Obligations Agent, administrative agent or
trustee for the Second Lien Obligations for application to the payment of all
outstanding Excess Second Lien Obligations that are then due and payable in such
order as may be provided in the Second Lien Documents in an amount sufficient to
pay in full in cash all outstanding Excess Second Lien Obligations that are then
due and payable;

Seventh, to the Revolving Facility Agent for application to the payment of all
outstanding Excess Revolving Facility Obligations that are then due and payable
in such order as may be provided in the Revolving Facility Documents in an
amount sufficient to pay in full in cash all outstanding Excess Revolving
Facility Obligations that are then due and payable; and

Eighth, any surplus remaining after the payment in full in cash of the amounts
described in the preceding clauses will be paid to the Company or the applicable
Grantor, as the case may be, its successors or assigns, or as a court of
competent jurisdiction may direct.

(b) In connection with the application of Proceeds pursuant to Section 7.3(a),
except as otherwise directed by the Required Lenders (or equivalent term) under
(and as defined in) the Second Lien Documents, the Second Lien Security Agent
may sell any non-Cash Proceeds for cash prior to the application of the Proceeds
thereof.

(c) If the Second Lien Security Agent or any Second Lien Secured Party collects
or receives any Proceeds of Revolving Facility Priority Collateral in connection
with such Notes Priority Collateral Enforcement Action that should have been
applied to the payment of the First Lien Obligations in accordance with
Section 7.1(a), or the Revolving Facility Obligations in accordance with
Section 7.2(a), whether after the commencement of an Insolvency or Liquidation
Proceeding or otherwise, such Second Lien Secured Party will forthwith deliver
the same to the First Lien Security Agent, for the account of the holders of the
First Lien Obligations, or the Revolving Facility Agent, for the account of the
holders of the Revolving Facility Obligations, to be applied in accordance with
Section 7.1(a) or Section 7.2(a), as the case may be. Until so delivered, such
Proceeds will be held by that Second Lien Secured Party for the benefit of the
holders of the First Lien Obligations or Revolving Facility Obligations, as the
case may be.

7.4. Mixed Collateral Proceeds. Notwithstanding anything to the contrary
contained above or in the definition of the Revolving Facility Priority
Collateral or Notes Priority

 

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Collateral, in the event that Proceeds of Collateral are received from (or are
otherwise attributable to the value of) a sale or other disposition of
Collateral that involves a combination of Revolving Facility Priority Collateral
and Notes Priority Collateral where the aggregate sales price is not allocated
between the Revolving Facility Priority Collateral and the Notes Priority
Collateral (and unless otherwise agreed among the Security Agents), the portion
of such Proceeds that shall be allocated as Proceeds of Revolving Facility
Priority Collateral for purposes of this Agreement shall be an amount equal to
the net book value of such Revolving Facility Priority Collateral (except in the
case of Accounts which amount shall be equal to the face amount of such
Accounts). In addition, notwithstanding anything to the contrary contained above
or in the definition of the Revolving Facility Priority Collateral or Notes
Priority Collateral, to the extent Proceeds of Collateral are Proceeds received
from (or are otherwise attributable to the value of) the sale or disposition of
all or substantially all of the Capital Stock of any of the Subsidiaries of
Holdings which is a Grantor, or all or substantially all of the assets of any
such Subsidiary, where the aggregate sales price is not allocated between the
Revolving Facility Priority Collateral and the Notes Priority Collateral (and
unless otherwise agreed among the Security Agents), such Proceeds shall
constitute (1) first, in an amount equal to the face amount of the Accounts and
Payment Intangibles (as described in clause (i) of the definition of Revolving
Facility Priority Collateral, and excluding any Accounts and Payment Intangibles
to the extent excluded pursuant to said clause (i)) and the net book value of
the Inventory owned by such Subsidiary at the time of such sale, Revolving
Facility Priority Collateral and (2) second, to the extent in excess of the
amounts described in preceding clause (1), Notes Priority Collateral or
additional Revolving Facility Priority Collateral in accordance with the
respective fair market value of the other Collateral sold. In the event that
amounts are received in respect of Capital Stock of or intercompany loans issued
to any Grantor in an Insolvency or Liquidation Proceeding, such amounts shall be
deemed to be Proceeds received from a sale or disposition of Revolving Facility
Priority Collateral and Notes Priority Collateral and shall be allocated as
Proceeds of Revolving Facility Priority Collateral and Notes Priority Collateral
in proportion to the Revolving Facility Priority Collateral and Notes Priority
Collateral owned at such time by the issuer of such Capital Stock or
intercompany note.

 

Section 8. Miscellaneous.

8.1. Conflicts. In the event of any conflict between the provisions of this
Agreement and the provisions of the First Lien Documents, the Second Lien
Documents or the Revolving Facility Documents, the provisions of this Agreement
shall govern and control. Each Secured Party acknowledges and agrees that the
terms and provisions of this Agreement do not violate any term or provision of
its respective First Lien Document, Second Lien Document or Revolving Facility
Document.

The parties hereto acknowledge that the terms of this Agreement are not intended
to negate any specific rights granted to any Grantor in any of the other First
Lien Documents, Second Lien Documents or Revolving Facility Documents.

8.2. Effectiveness; Continuing Nature of this Agreement; Severability. (a) This
Agreement shall become effective when executed and delivered by the parties
hereto. Each Security Agent, on behalf of itself and the applicable Secured
Parties, hereby waives any right it may have under applicable law to revoke this
Agreement or any of the provisions of this

 

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Agreement. The terms of this Agreement shall survive, and shall continue in full
force and effect, in any Insolvency or Liquidation Proceeding. Without limiting
the generality of the foregoing, this Agreement is intended to constitute and
shall be deemed to constitute a “subordination agreement” within the meaning of
Section 510(a) of the Bankruptcy Code and is intended to be and shall be
interpreted to be enforceable to the maximum extent permitted pursuant to
applicable non-bankruptcy law. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall not invalidate the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. All references to the Company and/or any other Grantor shall
include the Company and/or such Grantor as debtor and debtor in possession and
any receiver or trustee for the Company and/or any other Grantor (as the case
may be) in any Insolvency or Liquidation Proceeding.

(b) This Agreement shall terminate and be of no further force and effect:

(i) with respect to the Revolving Facility Agent, the Revolving Facility Secured
Parties and the Revolving Facility Obligations, upon the Discharge of Revolving
Facility Obligations and payment of the Excess Revolving Facility Obligations,
subject to the rights of the Revolving Facility Secured Parties under
Section 8.17;

(ii) with respect to the First Lien Security Agent, the First Lien Secured
Parties and the First Lien Obligations, upon the Discharge of First Lien
Obligations and payment of the Excess First Lien Obligations, subject to the
rights of the First Lien Secured Parties under Section 8.17; and

(iii) if any Additional Second Lien Obligations have been issued, with respect
to the Second Lien Security Agent, the Second Lien Secured Parties and the
Second Lien Obligations, upon the Discharge of Second Lien Obligations and
payment of the Excess Second Lien Obligations, subject to the rights of the
Second Lien Secured Parties under Section 8.17.

8.3. Amendments; Waivers. (a) No amendment, modification or waiver of any of the
provisions of this Agreement by the First Lien Security Agent, the Revolving
Facility Agent or, if any Additional Second Lien Obligations have been issued,
the Second Lien Security Agent shall be deemed to be made unless the same shall
be in writing signed on behalf of each party hereto or its authorized agent;
provided that (i) additional Grantors may be added as parties hereto in
accordance with the provisions of Section 8.16 and (ii) parties (or any
Additional Lien Obligations Agent) providing any Additional Lien Obligations may
be added as parties hereto in accordance with the provisions of Section 8.19.
Notwithstanding the provisions of any other First Lien Document, Second Lien
Document or Revolving Facility Document, the Directing First Lien Security
Agent, the Directing Second Lien Security Agent or the Revolving Facility Agent
may make any amendments, restatements, amendment and restatements, supplements
or other modifications to this Agreement to correct any ambiguity, omission,
mistake, defect or inconsistency contained herein without the consent of any
other Person; provided that the Company shall be given written notice of any
amendment, restatement, amendment and restatement, supplement or other
modification of this Agreement promptly after its execution thereof (it being
understood that the failure to deliver such notice to the Company shall in no
way impact the effectiveness of any such amendment, restatement, amendment and
restatement,

 

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supplement or modification). Each waiver of the terms of this Agreement, if any,
shall be a waiver only with respect to the specific instance involved and shall
in no way impair the rights of the parties hereto making such waiver or the
obligations of the other parties hereto to such party making such waiver in any
other respect or at any other time. Notwithstanding the foregoing, neither the
Company nor any other Grantor shall have any right to consent to or approve any
amendment, modification or waiver of any provision of this Agreement except to
the extent its rights, obligations, interests or privileges are directly
affected or any additional duties or obligations are imposed on it (which
includes any amendment to the Grantors’ ability to cause Additional Lien
Obligations to constitute First Lien Obligations or Second Lien Obligations, as
the Company and/or any other Grantor may designate); provided that the Company
shall be given notice of any amendment, restatement, amendment and restatement,
supplement or other modification of this Agreement to which it is not a party
promptly after the execution and effectiveness thereof (it being understood that
the failure to deliver such notice to the Company shall in no way impact the
effectiveness of any such amendment, restatement, amendment and restatement,
supplement or modification).

(b) It is understood that each Directing Security Agent, without the consent of
any Secured Party other than the other Directing Security Agents (provided that
the Company shall be given notice of any supplemental agreement described in
this clause (b) promptly after the effectiveness thereof (it being understood
that the failure to deliver such notice to the Company shall in no way impact
the effectiveness of any such amendment, restatement, amendment and restatement,
supplement or modification)), may in its discretion determine that a
supplemental agreement (which may take the form of an amendment and restatement
of this Agreement) is necessary or appropriate (i) to facilitate having any
Additional Lien Obligations become First Lien Obligations or Second Lien
Obligations, as the case may be, under this Agreement, (ii) to give effect to
any amendments contemplated by Section 3.4(j), Section 3.4(k) or Section 4.4(i)
in connection with a Permitted Refinancing of First Lien Obligations, Second
Lien Obligations or Revolving Facility Obligations, as applicable, and (iii) to
establish that the Liens on any Collateral securing such Additional Lien
Obligations shall have the same priority (or junior priority) as the Liens on
all or any portion of the Collateral securing the First Lien Obligations and
Second Lien Obligations, existing immediately prior to the incurrence of the
Additional Lien Obligations, which supplemental agreement shall, in the case of
preceding clauses (i) and (iii) specify whether such Additional Lien Obligations
constitute First Lien Obligations or Second Lien Obligations. Each of the
Revolving Facility Agent, the Directing First Lien Security Agent and the
Directing Second Lien Security Agent shall execute and deliver a supplemental
agreement described in this Section 8.3(b) at the other’s request (or upon the
request of the Company) and without the consent of any First Lien Secured Party,
Second Lien Secured Party or Revolving Facility Secured Party, and such
supplemental agreement may contain additional intercreditor terms applicable
solely to the holders of such Additional Lien Obligations vis-à-vis the holders
of the relevant obligations hereunder but otherwise without any material
modification of this Agreement.

8.4. Information Concerning Financial Condition of Holdings, the Company and its
Subsidiaries. The First Lien Security Agent, the other First Lien Secured
Parties, the Second Lien Security Agent, the other Second Lien Secured Parties,
the Revolving Facility Agent and

 

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the other Revolving Facility Secured Parties, shall each be responsible for
keeping themselves informed of (a) the financial condition of Holdings, the
Company and its Subsidiaries and all endorsers and/or guarantors of any of the
First Lien Obligations, the Second Lien Obligations and the Revolving Facility
Obligations and (b) all other circumstances bearing upon the risk of nonpayment
of any of the Revolving Facility Obligations, the First Lien Obligations and the
Second Lien Obligations. No Security Agent or its respective Secured Parties
shall have any duty to advise the other Security Agents or their respective
Secured Parties of information known to it or them regarding such condition or
any such circumstances or otherwise. In the event that any of the First Lien
Security Agent or any of the other First Lien Secured Parties, the Second Lien
Security Agent or any of the other Second Lien Secured Parties, or the Revolving
Facility Agent or any of the other Revolving Facility Secured Parties, in its or
their sole discretion, undertakes at any time or from time to time to provide
any such information to any other party hereto, it or they shall be under no
obligation (w) to make, and such informing party shall not make, any express or
implied representation or warranty, including with respect to the accuracy,
completeness, truthfulness or validity of any such information so provided,
(x) to provide any additional information or to provide any such information on
any subsequent occasion, (y) to undertake any investigation or (z) to disclose
any information which, pursuant to accepted or reasonable commercial finance
practices, such party wishes to maintain confidential or is otherwise required
to maintain confidential.

8.5. Submission to Jurisdiction; Waivers.

(a) EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF
AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF ANY U.S. FEDERAL OR NEW YORK
STATE COURT SITTING IN THE BOROUGH OF MANHATTAN, IN THE CITY OF NEW YORK (OR ANY
APPELLATE COURT THEREFROM) OVER ANY SUIT, IN ANY ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT AND AGREES THAT ALL CLAIMS IN RESPECT OF
ANY SUCH ACTION OR PROCEEDING SHALL (EXCEPT AS PERMITTED BELOW) BE HEARD AND
DETERMINED IN SUCH NEW YORK STATE OR, TO THE EXTENT PERMITTED BY LAW, FEDERAL
COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH
ACTION OR PROCEEDING MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE
JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. EACH PARTY HERETO AGREES THAT
THE AGENTS AND THE SECURED PARTIES RETAIN THE RIGHT TO BRING PROCEEDINGS AGAINST
THE COMPANY AND ANY OTHER GRANTOR IN THE COURTS OF ANY OTHER JURISDICTION.

(b) EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT IN ANY COURT REFERRED TO IN
PARAGRAPH (a) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY CLAIM OR DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION, SUIT OR PROCEEDING IN ANY
SUCH COURT.

 

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(c) TO THE EXTENT PERMITTED BY LAW, EACH PARTY TO THIS AGREEMENT HEREBY
IRREVOCABLY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND AGREES
THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL (OR ANY
SUBSTANTIALLY SIMILAR FORM OF MAIL) DIRECTED TO IT AT ITS ADDRESS FOR NOTICES AS
PROVIDED FOR IN SECTION 8.6. EACH PARTY TO THIS AGREEMENT HEREBY WAIVES ANY
OBJECTION TO SUCH SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES
NOT TO PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER
ANY LOAN DOCUMENT THAT SERVICE OF PROCESS WAS INVALID AND INEFFECTIVE. NOTHING
IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT WILL AFFECT THE RIGHT OF ANY PARTY
TO THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

8.6. Notices. All notices to the Revolving Facility Secured Parties, the First
Lien Secured Parties and the Second Lien Secured Parties permitted or required
under this Agreement shall also be sent to the Revolving Facility Agent, the
Directing First Lien Security Agent and the Directing Second Lien Security
Agent, respectively. Unless otherwise specifically provided herein, any notice
hereunder shall be in writing and may be personally served, telexed or sent by
telefacsimile or U.S. mail or courier service and shall be deemed to have been
given when delivered in person or by courier service and signed for against
receipt thereof, upon receipt of telefacsimile or telex, or three Business Days
after depositing it in the U.S. mail with postage prepaid and properly
addressed. For the purposes hereof, the addresses of the parties hereto shall be
as set forth below each party’s name on the signature pages hereto, or, as to
each party, at such other address as may be designated by such party in a
written notice to all of the other parties.

8.7. Further Assurances. The First Lien Security Agent, on behalf of itself and
the other First Lien Secured Parties, the Second Lien Security Agent, on behalf
of itself and the other Second Lien Secured Parties, and the Revolving Facility
Agent, on behalf of itself and the other Revolving Facility Secured Parties, and
each Grantor, agrees that each of them shall take such further action and shall
execute (without recourse or warranty) and deliver such additional documents and
instruments (in recordable form, if requested) as the Directing First Lien
Security Agent, the Directing Second Lien Security Agent or the Revolving
Facility Agent may reasonably request to effectuate the terms of and the Lien
priorities contemplated by this Agreement.

8.8. APPLICABLE LAW. THIS AGREEMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE
ARISING UNDER OR RELATED TO THIS AGREEMENT, WHETHER IN TORT, CONTRACT (AT LAW OR
IN EQUITY) OR OTHERWISE, SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF
LAW PRINCIPLES THAT WOULD RESULT IN THE APPLICATION OF ANY LAW OTHER THAN THE
LAW OF THE STATE OF NEW YORK.

 

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8.9. Binding on Successors and Assigns. This Agreement shall be binding upon the
parties hereto, the First Lien Secured Parties, the Second Lien Secured Parties,
the Revolving Facility Secured Parties and their respective successors and
assigns.

8.10. Specific Performance. Each of the First Lien Security Agent, the Second
Lien Security Agent and the Revolving Facility Agent may demand specific
performance of this Agreement. The First Lien Security Agent, on behalf of
itself and the other First Lien Secured Parties, the Second Lien Security Agent,
on behalf of itself and the other Second Lien Secured Parties, and the Revolving
Facility Agent, on behalf of itself and the other Revolving Facility Secured
Parties, hereby irrevocably waives any defense based on the adequacy of a remedy
at law and any other defense which might be asserted to bar the remedy of
specific performance in any action which may be brought by the First Lien
Security Agent, the Second Lien Security Agent or the Revolving Facility Agent,
as the case may be.

8.11. Headings. Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose or be given any substantive effect.

8.12. Counterparts. 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. Delivery of an executed counterpart of a signature page of this
Agreement or any document or instrument delivered in connection herewith by
telecopy or by email as a “.pdf” or “.tif” attachment shall be effective as
delivery of a manually executed counterpart of this Agreement or such other
document or instrument, as applicable.

8.13. Authorization; No Conflict. Each of the Secured Parties party hereto
represents and warrants to all other parties hereto that the execution, delivery
and performance by or on behalf of such Secured Party has been duly authorized
by all necessary action, corporate or otherwise, does not violate any
requirement of law or any agreement or instrument by which such party is bound,
and requires no consent of any Governmental Authority or other consent that has
not been obtained and is not in full force and effect.

8.14. No Third Party Beneficiaries. This Agreement and the rights and benefits
hereof shall inure to the benefit of the First Lien Secured Parties, the Second
Lien Secured Parties and the Revolving Facility Secured Parties and each of
their respective successors and assigns. No other Person shall have or be
entitled to assert rights or benefits hereunder other than the Grantors under
Section 3.1, Section 3.2, Section 4.1 and Section 4.2 (in each case, solely with
respect to the standstill periods referred to therein), Section 3.4(a), (b), and
(f) and (l), Section 4.4(a) and (b), Section 5.1, Section 6.4, Section 8.3,
Section 8.5 through this Section 8.14, Section 8.19 and under any provision
hereof purporting to preserve any right of, or directly affecting any Grantor,
under this Agreement or any First Lien Document, Second Lien Document or
Revolving Facility Document.

8.15. Provisions Solely to Define Relative Rights. (a) The provisions of this
Agreement are and are intended solely for the purpose of defining the relative
rights and remedies of the First Lien Secured Parties, the Second Lien Secured
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Facility Secured Parties. Except as expressly provided in Section 8.14, none of
the Grantors or any creditor thereof shall have any rights hereunder. Nothing in
this Agreement is intended to or shall impair, as between the Grantors and the
First Lien Secured Parties, the Grantors and the Second Lien Secured Parties and
the Grantors and the Revolving Facility Secured Parties, the obligations of the
Grantors to pay the First Lien Obligations, the Second Lien Obligations and the
Revolving Facility Obligations as and when the same shall become due and payable
in accordance with their respective terms.

(b) Nothing in this Agreement shall relieve the Company or any other Grantor
from the performance of any term, covenant, condition or agreement on the
Company’s or such Grantor’s part to be performed or observed under, or in
respect of, any of the Collateral granted by such Grantor, or pledged by such
Grantor, as security for the applicable Obligations to the extent arising under
any of the other First Lien Documents, the other Second Lien Documents or the
other Revolving Facility Documents or from any liability (to the extent arising
under any of the other First Lien Documents, the other Second Lien Documents or
the other Revolving Facility Documents) to any Person under or in respect of any
of such Collateral or impose any obligation on any Security Agent to perform or
observe any such term, covenant, condition or agreement on the Company’s or such
other Grantor’s part to be so performed or observed or impose any liability on
any Security Agent for any act or omission on the part of the Company or such
other Grantor relative thereto or for any breach of any representation or
warranty on the part of the Company or such other Grantor contained in this
Agreement or any Revolving Facility Document, First Lien Document or Second Lien
Document, or in respect of the Collateral pledged by it. The obligations of the
Company and each other Grantor contained in this paragraph shall survive the
termination of this Agreement and the discharge of the Company’s or such other
Grantor’s other obligations hereunder.

(c) Each of the Security Agents acknowledges and agrees that it has not made any
representation or warranty with respect to the execution, validity, legality,
completeness, collectability or enforceability of any other Revolving Facility
Document, other First Lien Document or other Second Lien Document. Except as
otherwise provided in this Agreement, each of the Security Agents and the
Administrative Agents will be entitled to manage and supervise their respective
extensions of credit to any of the Company and its Subsidiaries in accordance
with applicable law and such Security Agent’s or Administrative Agent’s usual
practices, modified from time to time as they deem appropriate.

8.16. Additional Grantors. The Company will cause each Person that is required
by any First Lien Document, Second Lien Document or Revolving Facility Document
to guarantee any of the Company’s First Lien Obligations, the Second Lien
Obligations and the Revolving Facility Obligations and grant a Lien on any of
its property or assets as collateral security for the First Lien Obligations,
the Second Lien Obligations and the Revolving Facility Obligations, to become a
party to this Agreement for all purposes of this Agreement, by causing such
Person to execute and deliver to each of the Revolving Facility Agent, on behalf
of itself and the other Revolving Facility Secured Parties, the First Lien
Security Agent, on behalf of itself and the other First Lien Secured Parties,
and the Second Lien Security Agent, on behalf of itself and the other Second
Lien Secured Parties an Intercreditor Agreement Joinder, whereupon such Person
will be bound by the terms hereof to the same extent as if it had executed and
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Agreement as of the date hereof. The Company shall, promptly after the execution
and delivery thereof, provide each Security Agent with a copy of each
Intercreditor Agreement Joinder executed and delivered pursuant to this
Section 8.16.

8.17. Avoidance Issues. If any Revolving Facility Secured Party, First Lien
Secured Party or Second Lien Secured Party is required, in any Insolvency or
Liquidation Proceeding or otherwise, to turn over or otherwise pay to the estate
of the Company or any other Grantor any amount (a “Recovery”), then such
Revolving Facility Secured Party, First Lien Secured Party or Second Lien
Secured Party, as applicable, shall be entitled to a reinstatement of Revolving
Facility Obligations, First Lien Obligations or Second Lien Obligations, as
applicable, with respect to all such recovered amounts. If this Agreement shall
have been terminated prior to such Recovery, this Agreement shall be reinstated
in full force and effect, and such prior termination shall not diminish,
release, discharge, impair or otherwise affect the obligations of the parties
hereto from such date of reinstatement.

8.18. Subrogation. (a) With respect to the value of any payments or
distributions in cash, property or other assets that (i) the Revolving Facility
Secured Parties or Revolving Facility Agent pay over to the Directing First Lien
Security Agent or any of the other First Lien Secured Parties under the terms of
this Agreement with respect to any Notes Priority Collateral, the Revolving
Facility Secured Parties and the Revolving Facility Agent shall be subrogated to
the rights of the Directing First Lien Security Agent and such other First Lien
Secured Parties (if any Additional Second Lien Obligations have been issued
following the Discharge of Second Lien Obligations), (ii) the Second Lien
Secured Parties or Second Lien Security Agent pay over to the Directing First
Lien Security Agent or any of the other First Lien Secured Parties under the
terms of this Agreement with respect to any Notes Priority Collateral, the
Second Lien Secured Parties and the Second Lien Security Agent shall be
subrogated to the rights of the Directing First Lien Security Agent and such
other First Lien Secured Parties, (iii) the Second Lien Secured Parties or
Second Lien Security Agent pay over to the Directing First Lien Security Agent
or any of the other First Lien Secured Parties under the terms of this Agreement
with respect to any Revolving Facility Priority Collateral, the Second Lien
Secured Parties and the Second Lien Security Agent shall be subrogated to the
rights of the Directing First Lien Security Agent and such other First Lien
Secured Parties following Discharge of Revolving Facility Obligations; provided
that, each of the Revolving Facility Agent, on behalf of itself and the other
Revolving Facility Secured Parties, and the Second Lien Security Agent, on
behalf of itself and the other Second Lien Secured Parties, hereby agrees not to
assert or enforce all such rights of subrogation it may acquire as a result of
any payment hereunder until the Discharge of First Lien Obligations has
occurred. The Company and each other Grantor acknowledges and agrees that, the
value of any payments or distributions in cash, property or other assets
received by the Revolving Facility Agent, the other Revolving Facility Secured
Parties, the Second Lien Security Agent or the other Second Lien Secured Parties
and required, in accordance with the terms hereof, to be paid over to the
Directing First Lien Security Agent or the other First Lien Secured Parties
pursuant to, and applied in accordance with, this Agreement, shall not relieve
or reduce any of the Revolving Facility Obligations or the Second Lien
Obligations, as applicable, owed by the Company or any other Grantor under the
Revolving Facility Documents or the Second Lien Documents.

 

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(b) If any Additional Second Lien Obligations have been issued, with respect to
the value of any payments or distributions in cash, property or other assets
that the Revolving Facility Secured Parties or Revolving Facility Agent pay over
to the Directing Second Lien Security Agent or any of the other Second Lien
Secured Parties under the terms of this Agreement with respect to any Notes
Priority Collateral, the Revolving Facility Secured Parties and the Revolving
Facility Agent shall be subrogated to the rights of the Directing Second Lien
Security Agent and the other Second Lien Secured Parties; provided that, the
Revolving Facility Agent, on behalf of itself and the other Revolving Facility
Secured Parties, hereby agrees not to assert or enforce all such rights of
subrogation it may acquire as a result of any payment hereunder until the
Discharge of Second Lien Obligations has occurred. The Company and each other
Grantor acknowledges and agrees that, the value of any payments or distributions
in cash, property or other assets received by the Revolving Facility Agent or
the other Revolving Facility Secured Parties and required, in accordance with
the terms hereof, to be paid over to the Directing Second Lien Security Agent or
the other Second Lien Secured Parties pursuant to, and applied in accordance
with, this Agreement, shall not relieve or reduce any of the Revolving Facility
Obligations owed by the Company or any other Grantor under the Revolving
Facility Documents.

(c) With respect to the value of any payments or distributions in cash, property
or other assets that (i) the First Lien Secured Parties or First Lien Security
Agent pay over to the Revolving Facility Agent or any of the other Revolving
Facility Secured Parties under the terms of this Agreement with respect to the
Revolving Facility Priority Collateral, the First Lien Secured Parties and the
First Lien Security Agent shall be subrogated to the rights of the Revolving
Facility Agent and the other Revolving Facility Secured Parties and (ii) the
Second Lien Secured Parties or Second Lien Security Agent pay over to the
Revolving Facility Agent or any of the other Revolving Facility Secured Parties
under the terms of this Agreement with respect to the Revolving Facility
Priority Collateral, the Second Lien Secured Parties and the Second Lien
Security Agent shall be subrogated to the rights of the Revolving Facility Agent
and the other Revolving Facility Secured Parties; provided that, each of the
First Lien Security Agent, on behalf of itself and the other First Lien Secured
Parties, and the Second Lien Security Agent, on behalf of itself and the other
Second Lien Secured Parties, hereby agrees not to assert or enforce all such
rights of subrogation it may acquire as a result of any payment hereunder until
the Discharge of Revolving Facility Obligations has occurred. The Company and
each other Grantor acknowledges and agrees that, the value of any payments or
distributions in cash, property or other assets received by the Directing First
Lien Security Agent, any other First Lien Secured Parties, the Second Lien
Security Agent or any other Second Lien Secured Parties and required, in
accordance with the terms hereof, to be paid over to the Revolving Facility
Agent or the other Revolving Facility Secured Parties pursuant to, and applied
in accordance with, this Agreement, shall not relieve or reduce any of the First
Lien Obligations or Second Lien Obligations, as applicable, owed by the Company
or any other Grantor under the First Lien Documents or Second Lien Documents.

 

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8.19. Additional Lien Obligations. The Grantors will be permitted from time to
time to designate as an additional holder of First Lien Obligations and/or
Second Lien Obligations hereunder each Person who is, or who becomes or who is
to become, the holder of any Additional Lien Obligations. Upon the issuance or
incurrence of any such Additional Lien Obligations:

(a) the Company shall deliver to each Security Agent an officer’s certificate
stating that the applicable Grantors intend to enter or have entered into an
Additional Lien Obligation Agreement and certifying that the issuance or
incurrence of such Additional Lien Obligations and the Liens securing such
Additional Lien Obligations are permitted by the First Lien Credit Agreement,
the Revolving Facility Credit Agreement and each then extant Additional First
Lien Obligations Agreement and Additional Second Lien Obligations Agreement, as
applicable. Each of the Additional Lien Obligations Agents, the First Lien
Security Agent, the Second Lien Security Agent and the Revolving Facility Agent
shall be entitled to rely conclusively on the determination of the Company that
such issuance and/or incurrence does not violate the provisions of the First
Lien Documents, the Second Lien Documents and the Revolving Facility Documents
to the extent set forth in such officer’s certificate delivered pursuant to this
clause (a); provided, however, that such determination will not affect whether
or not each applicable Grantor has complied with its undertakings in the First
Lien Documents, the Second Lien Documents or the Revolving Facility Documents;

(b) the Additional Lien Obligations Agent for such Additional Lien Obligations
shall execute and deliver to the Security Agents an Intercreditor Agreement
Joinder acknowledging that such holders shall be bound by the terms hereof to
the extent applicable to First Lien Secured Parties or the Second Lien Secured
Parties, as applicable; and

(c) each existing Security Agent shall promptly enter into such documents and
agreements (including amendments, restatements, amendments and restatements,
supplements or other modifications to this Agreement) as the Company, any
existing Security Agent (but no other Secured Party) or the Additional Lien
Obligations Agent may reasonably request in order to provide to it the rights,
remedies and powers and authorities contemplated hereby, in each case consistent
in all respects with the terms of this Agreement.

Notwithstanding the foregoing, nothing in this Agreement will be construed to
allow any Grantor to incur additional Indebtedness unless otherwise permitted by
the terms of each applicable First Lien Document, Second Lien Document and
Revolving Facility Document.

8.20. Agreement Among Secured Parties to Coordinate Enforcement.

(a) Each First Lien Secured Party, solely as among themselves in such capacity
and solely for their mutual benefit, hereby agrees that the First Lien Security
Agent designated as the Directing First Lien Security Agent shall have the sole
right and power, as among the First Lien Security Agents and the First Lien
Secured Parties, to take and direct any right or remedy with respect to
Collateral in accordance with the terms of this Agreement and the relevant First
Lien Documents. The First Lien Secured Parties shall be deemed to have
irrevocably appointed the Directing First Lien Security Agent as their exclusive
agent hereunder. Consistent with such appointment, the First Lien Secured
Parties further shall be deemed to have agreed that only the Directing First
Lien Security Agent (and not any individual claimholder or group of
claimholders) as agent for the First Lien Secured Parties, or any of the
Directing First Lien Security Agent’s agents shall have the right on their
behalf to exercise any rights, powers,

 

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and/or remedies under or in connection with this Agreement (including bringing
any action to interpret or otherwise enforce the provisions of this Agreement);
provided that First Lien Secured Parties may exercise customary rights of setoff
against depository or other accounts maintained with them in accordance with the
terms of the relevant First Lien Document or applicable law. Specifically, but
without limiting the generality of the foregoing, no First Lien Secured Party,
other than the Directing First Lien Security Agent, shall be entitled to take or
file, but instead shall be precluded from taking or filing (whether in any
Insolvency or Liquidation Proceeding or otherwise), any action, judicial or
otherwise, to enforce any right or power or pursue any remedy under this
Agreement (including any declaratory judgment or other action to interpret or
otherwise enforce the provisions of this Agreement), except solely as provided
in the proviso in the immediately preceding sentence.

(b) If any Additional Second Lien Obligations have been issued, each Second Lien
Secured Party, solely as among themselves in such capacity and solely for their
mutual benefit, hereby agrees that the Second Lien Security Agent designated as
the Directing Second Lien Security Agent shall have the sole right and power, as
among the Second Lien Security Agents and the Second Lien Secured Parties, to
take and direct any right or remedy with respect to Collateral in accordance
with the terms of this Agreement and the relevant Second Lien Documents. The
Second Lien Secured Parties shall be deemed to have irrevocably appointed the
Directing Second Lien Security Agent as their exclusive agent hereunder.
Consistent with such appointment, the Second Lien Secured Parties further shall
be deemed to have agreed that only the Directing Second Lien Security Agent (and
not any individual claimholder or group of claimholders) as agent for the Second
Lien Secured Parties, or any of the Directing Second Lien Security Agent’s
agents shall have the right on their behalf to exercise any rights, powers,
and/or remedies under or in connection with this Agreement (including bringing
any action to interpret or otherwise enforce the provisions of this Agreement);
provided that Second Lien Secured Parties may exercise customary rights of
setoff against depository or other accounts maintained with them in accordance
with the terms of the relevant Second Lien Document or applicable law.
Specifically, but without limiting the generality of the foregoing, no Second
Lien Secured Party, other than the Directing Second Lien Security Agent, shall
be entitled to take or file, but instead shall be precluded from taking or
filing (whether in any Insolvency or Liquidation Proceeding or otherwise), any
action, judicial or otherwise, to enforce any right or power or pursue any
remedy under this Agreement (including any declaratory judgment or other action
to interpret or otherwise enforce the provisions of this Agreement), except
solely as provided in the proviso in the immediately preceding sentence.

(c) Each Revolving Facility Secured Party, solely as among themselves in such
capacity and solely for their mutual benefit, hereby agrees that the Revolving
Facility Agent shall have the sole right and power, as among the Revolving
Facility Agent and the Revolving Facility Secured Parties, to take and direct
any right or remedy with respect to Collateral in accordance with the terms of
this Agreement and the relevant Revolving Facility Documents. The Revolving
Facility Secured Parties shall be deemed to have irrevocably appointed the
Revolving Facility Agent as their exclusive agent hereunder. Consistent with
such appointment, the Revolving Facility Secured Parties further shall be deemed
to have agreed that only the Revolving Facility Agent (and not any individual
claimholder or group of claimholders) as agent for the Revolving Facility
Secured Parties, or any of the Revolving Facility Agent’s agents shall

 

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have the right on their behalf to exercise any rights, powers, and/or remedies
under or in connection with this Agreement (including bringing any action to
interpret or otherwise enforce the provisions of this Agreement); provided that
Revolving Facility Secured Parties may exercise customary rights of setoff
against depository or other accounts maintained with them in accordance with the
terms of the relevant Revolving Facility Document or applicable law.
Specifically, but without limiting the generality of the foregoing, no Revolving
Facility Secured Party, other than the Revolving Facility Agent, shall be
entitled to take or file, but instead shall be precluded from taking or filing
(whether in any Insolvency or Liquidation Proceeding or otherwise), any action,
judicial or otherwise, to enforce any right or power or pursue any remedy under
this Agreement (including any declaratory judgment or other action to interpret
or otherwise enforce the provisions of this Agreement), except solely as
provided in the proviso in the immediately preceding sentence.

*   *   *

 

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

 

INTERLINE BRANDS, INC., as Holdings By:  

 

Name:   Title:   INTERLINE BRANDS, INC., as the Company By:  

 

Name:   Title:   WILMAR FINANCIAL, INC. By:  

 

Name:   Title:   GLENWOOOD ACQUISITION LLC By:  

 

Name:   Title:   JANPAK OF TEXAS, LLC By:  

 

Name:   Title:  

[Signature Page to Intercredtor Agreement]

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JANPAK, LLC By:  

 

Name:   Title:   JANPAK OF SOUTH CAROLINA, LLC By:  

 

Name:   Title:   ZIP TECHNOLOGY, LLC By:  

 

Name:   Title:   BANK OF AMERICA, N.A., as Revolving Facility Agent By:  

 

Name:   Title:   BARCLAYS BANK PLC, as First Lien Administrative Agent and as
First Lien Security Agent By:  

 

Name:   Title:  

[Signature Page to Intercreditor Agreement]

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EXHIBIT A

FORM OF

INTERCREDITOR AGREEMENT JOINDER

Reference is made to the Intercreditor Agreement, dated as of March 17, 2014 (as
amended, restated, amended and restated, supplemented or otherwise modified from
time to time, the “Intercreditor Agreement”), among INTERLINE BRANDS, INC., a
New Jersey corporation, INTERLINE BRANDS, INC., a Delaware corporation, the
other GRANTORS from time to time party thereto, Bank of America, N.A. (“Bank of
America”), as Revolving Facility Agent, Barclays Bank PLC, as First Lien
Administrative Agent and First Lien Security Agent, and certain other Persons
party or that may become party thereto from time to time. Capitalized terms used
but not defined herein shall have the meanings assigned to such terms in the
Intercreditor Agreement.

This Intercreditor Joinder Agreement, dated as of [            ], 201[    ]
(this “Joinder Agreement”), is being delivered pursuant to requirements of the
Intercreditor Agreement.

1. Joinder. The undersigned, [—], a [—], hereby agrees to become party to the
Intercreditor Agreement as an Obligor thereunder for all purposes thereof on the
terms set forth therein, and to be bound by the terms, conditions and provisions
of the Intercreditor Agreement as fully as if the undersigned had executed and
delivered the Intercreditor Agreement as of the date thereof.

2. Agreements. The undersigned Obligor hereby agrees, for the enforceable
benefit of all existing and future Revolving Facility Secured Parties, all
existing and future First Lien Secured Parties and all existing and future
Second Lien Secured Parties that the undersigned is bound by the terms,
conditions and provisions of the Intercreditor Agreement to the extent set forth
therein.

3. Notice Information. The address of the undersigned Obligor for purposes of
all notices and other communications hereunder and under the Intercreditor
Agreement is [—], Attention of [—] (Facsimile No. [—], electronic mail address:
[—]).

4. Counterparts. This Joinder Agreement may be executed in two or more
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute one contract. Delivery of an executed signature
page to this Joinder by facsimile transmission or by email as a “.pdf” or “.tif”
attachment shall be as effective as delivery of a manually signed counterpart of
this Joinder.

5. Governing Law. THIS JOINDER AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING
UNDER OR RELATED TO THIS JOINDER, WHETHER IN TORT, CONTRACT (AT LAW OR IN
EQUITY) OR OTHERWISE, SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF
LAW PRINCIPLES THAT WOULD RESULT IN THE APPLICATION OF ANY LAW OTHER THAN THE
LAW OF THE STATE OF NEW YORK.

6. Loan Document. This Joinder shall constitute a Loan Document, under and as
defined in, each of the Revolving Facility Credit Agreement and First Lien
Credit Agreement.

7. Miscellaneous. The provisions of Section 8 of the Intercreditor Agreement
will apply with like effect to this Intercreditor Agreement Joinder.

[Signature Pages Follow]

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IN WITNESS WHEREOF, the undersigned has caused this Intercreditor Agreement
Joinder to be duly executed by its authorized representative, and each of the
Revolving Facility Agent, the First Lien Security Agent and the Second Lien
Security Agent has caused the same to be accepted by its authorized
representative, as of the day and year first above written.

Acknowledged and Agreed to by:

 

Page 2

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Annex E

Annex E to First Amendment to Credit Agreement

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NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, THE LIENS AND SECURITY
INTERESTS GRANTED TO THE ADMINISTRATIVE AGENT FOR ITSELF AND THE OTHER SECURED
PARTIES PURSUANT TO THIS AMENDED AND RESTATED PLEDGE AND SECURITY AGREEMENT IN
ANY COLLATERAL AND THE EXERCISE OF ANY RIGHT OR REMEDY BY THE ADMINISTRATIVE
AGENT WITH RESPECT TO ANY COLLATERAL HEREUNDER ARE SUBJECT TO THE PROVISIONS OF
THE INTERCREDITOR AGREEMENT, DATED AS OF THE DATE HEREOF (AS AMENDED, RESTATED,
SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME, THE “INTERCREDITOR
AGREEMENT”), AMONG INTERLINE BRANDS, INC., A NEW JERSEY CORPORATION, INTERLINE
BRANDS, INC., A DELAWARE CORPORATION, THE OTHER GRANTORS FROM TIME TO TIME PARTY
HERETO, BANK OF AMERICA, N.A., AS REVOLVING FACILITY AGENT, AND BARCLAYS BANK
PLC, AS FIRST LIEN ADMINISTRATIVE AGENT AND AS FIRST LIEN SECURITY AGENT, AND
CERTAIN OTHER PERSONS PARTY OR THAT MAY BECOME PARTY THERETO FROM TIME TO TIME.
IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF THE INTERCREDITOR AGREEMENT
AND THIS AMENDED AND RESTATED PLEDGE AND SECURITY AGREEMENT, THE TERMS OF THE
INTERCREDITOR AGREEMENT SHALL GOVERN AND CONTROL.

AMENDED AND RESTATED PLEDGE AND SECURITY AGREEMENT

THIS AMENDED AND RESTATED PLEDGE AND SECURITY AGREEMENT (as it may be amended,
restated, supplemented or modified from time to time, this “Security Agreement”)
is entered into as of March 17, 2014 by and among INTERLINE BRANDS, INC., a New
Jersey corporation (the “Company”), and the subsidiaries of the Company listed
on the signature pages hereto (together with the Company, the “Initial
Grantors,” and collectively with any additional subsidiaries or other affiliates
of the Company, whether now existing or hereafter formed which become parties to
this Security Agreement, the “Grantors”, and each, a “Grantor”), and BANK OF
AMERICA, N.A., in its capacity as administrative agent (in such capacity, the
“Administrative Agent”) for itself and the other Secured Parties (as defined
below) in connection with the Credit Agreement referred to below.

RECITALS

A. The Company, Wilmar Holdings, Inc., a Delaware corporation (“Wilmar
Holdings”), and Wilmar Financial, Inc. a Delaware corporation (“Wilmar
Financial”), as borrowers, Interline Brands, Inc., a Delaware corporation
(“Holdings”), and Glenwood Acquisition LLC, a Delaware limited liability company
(“Glenwood”), as guarantors, the financial institutions party thereto as lenders
and the Administrative Agent entered into that certain Credit Agreement dated as
of September 7, 2012 (as amended, supplemented or otherwise modified from time
to time prior to the date hereof, including by that certain Joinder Agreement
dated as of December 11, 2012, among JanPak, LLC, a West Virginia limited
liability company (“JanPak”), JanPak of South Carolina, LLC, a South Carolina
limited liability company (“JanPak SC”), JanPak of Texas, LLC, a Texas limited
liability company (“JanPak Texas”), and Zip Technology, LLC, a West Virginia
limited liability company (“Zip Technology”), or their respective
predecessors-in-interest, and the Administrative Agent and by that certain
Joinder Agreement dated as of April 4, 2013, between IBI Merchandising Services,
Inc., a Delaware limited liability company (“IBI Merchandising”), and the
Administrative Agent, the “Existing Credit Agreement”), pursuant to which the
lenders party thereto have agreed to make Loans and provide certain other credit
accommodations to the borrowers thereunder.

B. In order to induce the lenders party thereto to enter into the Existing
Credit Agreement, Holdings, the Company, Wilmar Financial, Wilmar Holdings and
Glenwood entered into that certain Pledge and Security Agreement dated as of
September 7, 2012 (as amended, supplemented or otherwise modified from time to
time prior to the date hereof, including by the Supplement to Pledge and
Security Agreement dated as of December 11, 2013, among JanPak, JanPak SC,
JanPak Texas and Zip Technology (or their respective predecessors-in-interest)
and the Administrative Agent and the Supplement to Pledge and Security Agreement
dated as of April 4, 2013, between IBI Merchandising and the Administrative
Agent, the “Existing Security Agreement”), pursuant to which the Grantors named
therein granted to the Administrative Agent, for the benefit of the Secured
Parties, a security interest in their respective personal property as security
for the Secured Obligations.

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C. The Company, Holdings, the subsidiaries of the Company party thereto,
Barclays Bank PLC, as administrative agent and collateral agent (the “Term
Agent”), and the lenders party thereto are entering into that certain First Lien
Term Loan Agreement dated as of even date herewith (the “Term Loan Agreement”),
the proceeds of which will be used by the Company to, among other things,
refinance all Company Notes issued and outstanding as of date hereof (the
“Company Notes Refinancing”).

D. In connection with (i) the entry by the Company and Holdings into the Term
Loan Agreement and (ii) the Company Notes Refinancing, the borrowers under the
Existing Credit Agreement have requested, and the Required Lenders have agreed,
to amend the Existing Credit Agreement pursuant to an amendment agreement (the
“First Amendment”) to make certain changes to the Existing Credit Agreement.

E. In connection with the entry by the Company and Holdings into the Term Loan
Agreement and the First Amendment, the Required Lenders have agreed pursuant to
the First Amendment to release the security interest granted by Holdings under
the Existing Security Agreement and to terminate each of the obligations of
Holdings thereunder.

F. In connection with the (i) entry by the Company and Holdings into the Term
Loan Agreement, (ii) the Company Notes Refinancing and (iii) the First
Amendment, the parties hereto desire to amend and restate the Existing Security
Agreement in its entirety in order to make certain changes to the Existing
Security Agreement to promote consistency with that certain Pledge and Security
Agreement of even date herewith executed by the Grantors in favor of the Term
Agent.

G. The Administrative Agent, with the consent of the Required Lenders, is
willing to amend and restate the Existing Security Agreement.

NOW, THEREFORE, for valuable consideration hereby acknowledged, the parties
hereto hereby agree that the Existing Security Agreement is hereby amended and
restated in its entirety as follows:

ARTICLE I

DEFINITIONS

1.1. Terms Defined in Credit Agreement. All capitalized terms used herein and
not otherwise defined shall have the meanings assigned to such terms in the
Credit Agreement.

1.2. Terms Defined in UCC. Terms defined in the UCC which are not otherwise
defined in this Security Agreement are used herein as defined in the UCC.

1.3. Definitions of Certain Terms Used Herein. As used in this Security
Agreement, in addition to the terms defined in the Preamble and the Recitals,
the following terms shall have the following meanings:

“Accounts” shall have the meaning set forth in Article 9 of the UCC.

“Administrative Agent” shall have the meaning set forth in the Preamble.

“Amendment” shall have the meaning set forth in Section 4.4.

“Article” means a numbered article of this Security Agreement, unless another
document is specifically referenced.

“Chattel Paper” shall have the meaning set forth in Article 9 of the UCC.

 

2

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“Collateral” shall have the meaning set forth in Article II.

“Collateral Access Agreement” means an agreement, in form and substance
reasonably satisfactory to the Administrative Agent, by which (a) for any
Collateral located on leased premises, the lessor waives or subordinates any
Lien it may have on the Collateral, and agrees to permit the Administrative
Agent to enter upon the premises and remove the Collateral or to use the
premises to store or dispose of the Collateral; (b) for any Collateral held by a
warehouseman, processor, shipper, customs broker or freight forwarder, such
Person waives or subordinates any Lien it may have on the Collateral, agrees to
hold any Documents in its possession relating to the Collateral as agent for the
Administrative Agent, and agrees to deliver the Collateral to the Administrative
Agent upon request; (c) for any Collateral held by a repairman, mechanic or
bailee, such Person acknowledges the Administrative Agent’s Lien, waives or
subordinates any Lien it may have on the Collateral, and agrees to deliver the
Collateral to the Administrative Agent upon request; and (d) for any Collateral
subject to an IP License, the licensor grants to the Administrative Agent the
right, vis-à-vis such licensor, to enforce the Administrative Agent’s Liens with
respect to the Collateral, including the right to dispose of it with the benefit
of the intellectual property, whether or not a default exists under any
applicable IP License.

“Collateral Deposit Account” shall have the meaning set forth in Section 7.1(a).

“Collateral Report” means any certificate (including any Borrowing Base
Certificate), report or other document delivered by any Grantor to the
Administrative Agent or any Lender with respect to the Collateral pursuant to
any Loan Document.

“Commercial Tort Claims” means those certain currently existing commercial tort
claims of any Grantor, including each commercial tort claim listed on Exhibit K.

“Commodity Account” shall have the meaning set forth in Article 9 of the UCC.

“Company” shall have the meaning set forth in the Preamble.

“Company Notes Refinancing” shall have the meaning set forth in Recital C.

“Control” shall have the meaning set forth in Article 8 or, if applicable, in
Section 9-104, 9-105, 9-106 or 9-107 of Article 9 of the UCC.

“Copyright Security Agreement” means an agreement substantially in the form of
Exhibit H.

“Copyrights” means (a) copyrights, rights and interests in copyrights, copyright
registrations, and copyright applications; (b) mask works, as defined under 17
USC 901, et seq, and applications and registrations therefor; (c) renewals or
extensions of any of the foregoing; (d) income, royalties, damages, and payments
now or hereafter due and/or payable under any of the foregoing, including,
without limitation, damages or payments for past or future infringements for any
of the foregoing; (e) the right to sue for past, present, and future
infringements of any of the foregoing; and (f) rights corresponding to any of
the foregoing throughout the world.

“Credit Agreement” means the Existing Credit Agreement, as amended, restated,
supplemented or modified from time to time, including, without limitation, as
amended by the First Amendment.

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

“Deposit Account Control Agreement” means an agreement, in form and substance
reasonably satisfactory to the Administrative Agent, among any Grantor, a
banking institution holding such Grantor’s funds, and the Administrative Agent,
for the benefit of the Secured Parties, with respect to collection and control
of all deposits and balances held in a deposit account and any related lockbox
maintained by any Grantor with such banking institution.

 

3

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“Deposit Accounts” shall have the meaning set forth in Article 9 of the UCC.

“Documents” shall have the meaning set forth in Article 9 of the UCC.

“Effective Date” shall have the meaning set forth in the Credit Agreement.

“Electronic Chattel Paper” shall have the meaning set forth in Article 9 of the
UCC.

“Equipment” shall have the meaning set forth in Article 9 of the UCC.

“Event of Default” means an event described in Section 5.1.

“Excluded Accounts” means Deposit Accounts or Securities Accounts that (a) are
payroll, payroll taxes, similar employment taxes, employee benefit or
disbursement accounts, (b) constitute Grace Period Accounts or (c) have less
than $2,000,000, in the aggregate, on deposit.

“Excluded Assets” means the following assets and properties, and all right,
title and interest of any Grantor in such assets and properties: (a) any Equity
Interests in (i) any Foreign Subsidiary of such Grantor, other than 65% of the
issued and outstanding Equity Interests entitled to vote (within the meaning of
Treas. Reg. Section 1.956-2(c)(2)) of each first-tier Foreign Subsidiary of such
Grantor, as applicable, (ii) any Unrestricted Subsidiary, (iii) any Subsidiary
of such Grantor described in clause (c) of the definition of “Excluded
Subsidiary” in the Credit Agreement, other than 65% of the issued and
outstanding Equity Interests entitled to vote (within the meaning of Treas. Reg.
Section 1.956-2(c)(2)) of each such Subsidiary of such Grantor, or (iv) any
Person that is not a wholly-owned Subsidiary to the extent that such Person’s
constituent documents prohibit the granting of Liens thereon (but (A) excluding
the proceeds and receivables of the foregoing the assignment of which is
effective under the UCC notwithstanding such prohibitions and (B) immediately
upon the lapse, termination or waiver of any such prohibition, the Collateral
shall include, and the security interest granted by such Grantor shall
immediately attach to, all of such Grantor’s right, title and interest in and to
the foregoing); (b) motor vehicles and any other assets subject to certificates
of title; (c) any assets over which the granting of security interests in such
assets would be prohibited by any applicable law or regulation after giving
effect to each of Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any
successor provision or provisions), but excluding the proceeds and receivables
of the foregoing, the assignment of which is expressly deemed effective under
the UCC notwithstanding such prohibitions; provided that immediately upon the
lapse, termination or waiver of any such applicable law, the Collateral shall
include, and the security interest granted by such Grantor shall immediately
attach to, all of such Grantor’s right, title and interest in and to the
foregoing; (d) any lease, license, contract, property right or other agreement
(or any of its rights or interests thereunder), or any property owned by any
Grantor that is subject to a purchase money security interest (as defined in
Section 9-103 of the UCC) or leased by any Grantor pursuant to a capital lease,
in each case to the extent that the grant of the security interest would, after
giving effect to each of Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or
any successor provision or provisions) or any other applicable law,
(i) constitute or result in (A) the abandonment, invalidation or
unenforceability of any right, title or interest of such Grantor therein or
(B) a breach or termination pursuant to the terms of, or a default under, any
such lease, license, contract, property right, agreement or purchase money
arrangement or (ii) give any other party to any such lease, license, contract,
property right, agreement or purchase money arrangement a right of termination
in favor of any other party thereto (other than a Grantor), but excluding the
proceeds and receivables of each of the foregoing, the assignment of which is
expressly deemed effective under the UCC notwithstanding such prohibitions;
provided that immediately upon the lapse, termination or waiver of any such
provision, the Collateral shall include, and the security interest granted by
such Grantor shall immediately attach to, all of such Grantor’s right, title and
interest in and to the foregoing; (e) any fee-owned real property and any
leasehold rights and interests in real property; (f) any trademark application
filed in the USPTO on the basis of a Grantor’s intent-to-use such Trademark
prior to the filing of a “Statement of Use” pursuant to Section 1(d) of the
Lanham Act or an “Amendment to Allege Use” pursuant to Section 1(c) of the
Lanham Act with respect thereto, to the extent, and only for so long as, the
granting by a Grantor of a security interest therein would result in the loss by
such

 

4

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Grantor of any material rights therein, or impair the validity or enforceability
of any registration that issues therefrom under applicable federal law; (g) any
Commercial Tort Claim individually asserting damages of less than $12,500,000;
and (h) any specifically identified asset with respect to which the
Administrative Agent and the Company shall have reasonably determined that the
cost, burden, difficulty or consequence of obtaining or perfecting a security
interest therein outweighs the benefit of a security interest to the Secured
Parties afforded thereby.

“Excluded Payments” shall have the meaning set forth in Section 4.6(c)(iii).

“Exhibit” refers to a specific exhibit to this Security Agreement.

“Existing Credit Agreement” shall have the meaning set forth in Recital A.

“Existing Security Agreement” shall have the meaning set forth in Recital B.

“First Amendment” shall have the meaning set forth in Recital D.

“First Amendment Effective Date” means the date of this Security Agreement.

“Fixtures” shall have the meaning set forth in Article 9 of the UCC.

“General Intangibles” shall have the meaning set forth in Article 9 of the UCC.

“Glenwood” shall have the meaning set forth in Recital A.

“Goods” shall have the meaning set forth in Article 9 of the UCC.

“Grace Period Accounts” means Deposit Accounts and Securities Accounts acquired
in a Permitted Acquisition for a period of 60 days following the consummation of
such Permitted Acquisition.

“Grantors” shall have the meaning set forth in the Preamble.

“Holdings” shall have the meaning set forth in Recital A.

“IBI Merchandising” shall have the meaning set forth in Recital A.

“Initial Grantors” shall have the meaning set forth in the Preamble.

“Instruments” shall have the meaning set forth in Article 9 of the UCC.

“Intercreditor Agreement” shall have the meaning set forth in the legend on the
first page hereof.

“Inventory” shall have the meaning set forth in Article 9 of the UCC.

“Investment Property” shall have the meaning set forth in Article 9 of the UCC.

“IP Licenses” means, (a) licensing agreements consents to use, covenants not to
sue, or similar arrangements in and to any Patents, Copyrights, Trademarks, or
trade secrets, (b) income, royalties, damages, claims, and payments now or
hereafter due or payable under and with respect thereto, including, without
limitation, damages and payments for past, present, and future breaches thereof,
and (c) all rights to sue for past, present, and future breaches thereof.

“JanPak” shall have the meaning set forth in Recital A.

 

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“JanPak SC” shall have the meaning set forth in Recital A.

“JanPak Texas” shall have the meaning set forth in Recital A.

“Lanham Act” means the Lanham Trademark Act of 1946.

“Letter-of-Credit Rights” shall have the meaning set forth in Article 9 of the
UCC.

“Patent Security Agreement” means an agreement substantially in the form of
Exhibit I.

“Patents” means (a) patents and patent applications; (b) inventions and
improvements claimed therein; (c) reissues, divisions, continuations, extensions
and continuations-in-part of the foregoing; (d) income, royalties, damages,
claims and payments now or hereafter due or payable under and with respect to
the foregoing, including, without limitation, damages and payments for past,
present and future infringements of the foregoing; (e) the right to sue for
past, present, and future infringements of the foregoing; and (f) rights
corresponding to any of the foregoing throughout the world.

“Pledged Collateral” means all Instruments, Securities and other Investment
Property of the Grantors constituting Collateral, whether or not physically
delivered to the Administrative Agent pursuant to this Security Agreement, but,
in any case, excluding (i) any items constituting Excluded Assets and (ii) the
Equity Interests described in Section 8.7(i)(B).

“Receivables” means the Accounts, Chattel Paper, Documents, Investment Property,
Instruments and any other rights or claims to receive money which are General
Intangibles or which are otherwise included as Collateral.

“Required Secured Parties” means (a) prior to an acceleration of the Obligations
under the Credit Agreement, the Required Lenders, (b) after an acceleration of
the Obligations under the Credit Agreement but prior to the date upon which the
Credit Agreement has terminated by its terms and all of the obligations
thereunder have been paid in full, Lenders holding in the aggregate at least a
majority of the total of the Aggregate Credit Exposure, and (c) after the Credit
Agreement has terminated by its terms and all of the Obligations thereunder have
been paid in full (whether or not the Obligations under the Credit Agreement
were ever accelerated), Persons holding in the aggregate at least a majority of
the Secured Obligations, as determined by the Administrative Agent in its
reasonable discretion.

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

“Secured Parties” means, collectively, the Lenders, the Administrative Agent,
the Issuing Bank, and any other holders of the Secured Obligations.

“Securities Account” shall have the meaning set forth in Article 8 of the UCC.

“Securities Account Control Agreement” means an agreement, in form and substance
reasonably satisfactory to the Administrative Agent, among any Grantor, a
securities intermediary holding a Securities Account of such Grantor, and the
Administrative Agent, for the benefit of the Secured Parties.

“Security” shall have the meaning set forth in Article 8 of the UCC.

“Security Agreement” shall have the meaning set forth in the Preamble.

“Stock Rights” means all dividends, instruments or other distributions and any
other right or property which any Grantor shall receive or shall become entitled
to receive for any reason whatsoever with respect to, in substitution for or in
exchange for any Equity Interest constituting Collateral, any right to receive
an Equity Interest and any right to receive earnings, in which any Grantor now
has or hereafter acquires any right, issued by an issuer of such Equity
Interest.

 

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“Subsidiary Pledged Collateral” shall have the meaning set forth in
Section 3.13(b).

“Supporting Obligations” shall have the meaning set forth in Article 9 of the
UCC.

“Term Agent” shall have the meaning set forth in Recital C.

“Term Loan Agreement” shall have the meaning set forth in Recital C.

“Trademark Security Agreement” means an agreement substantially in the form of
Exhibit J.

“Trademarks” means (a) trademarks (including service marks), trade names, trade
dress and trade styles, internet domain names and other source identifiers;
(b) registrations and applications for registration of the foregoing; (c) the
goodwill of the business connected with the use of and symbolized by the
foregoing; (d) renewals of the foregoing; (e) income, royalties, damages, and
payments now or hereafter due or payable with respect thereto, including,
without limitation, damages, claims, and payments for past, present and future
infringements thereof; (f) right to sue for past, present, and future
infringements of the foregoing, including the right to settle suits involving
claims and demands for royalties owing; and (g) rights corresponding to any of
the foregoing throughout the world.

“UCC” means the Uniform Commercial Code, as in effect from time to time, of the
State of New York or of any other state the laws of which are required as a
result thereof to be applied in connection with the attachment, perfection or
priority of, or remedies with respect to, the Administrative Agent’s or any
other Secured Party’s Lien on any Collateral.

“USCO” means the United States Copyright Office.

“USPTO” means the United States Patent and Trademark Office.

“Wilmar Financial” shall have the meaning set forth in Recital A.

“Wilmar Holdings” shall have the meaning set forth in Recital A.

“Zip Technology” shall have the meaning set forth in Recital A.

The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms.

ARTICLE II

GRANT OF SECURITY INTEREST

Each Grantor hereby pledges, assigns and grants to the Administrative Agent (or
confirms that the Administrative Agent already possesses), on behalf of and for
the ratable benefit of the Secured Parties, a continuing security interest in
and Lien upon all of its right, title and interest in, to and under all personal
property, whether now owned by or owing to, or hereafter acquired by or arising
in favor of such Grantor (including under any trade name or derivations
thereof), and whether owned or consigned by or to, or leased from or to, such
Grantor, and regardless of where located (all of which will be collectively
referred to as the “Collateral”), including:

 

  (i) all Accounts;

 

  (ii) all Chattel Paper, including Electronic Chattel Paper;

 

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  (iii) all General Intangibles, including all Copyrights, Patents, Trademarks
and IP Licenses;

 

  (iv) all Documents;

 

  (v) all Goods, including Inventory, Equipment and Fixtures;

 

  (vi) all Instruments;

 

  (vii) all Investment Property, including Commodities Accounts and Securities
Accounts;

 

  (viii) all Letter-of-Credit Rights;

 

  (ix) all Deposit Accounts;

  (x) all Commercial Tort Claims;

 

  (xi) all Supporting Obligations;

 

  (xii) all monies, whether or not in the possession or under the control of the
Administrative Agent, a Lender, or a bailee or Affiliate of the Administrative
Agent, including any cash collateral;

 

  (xiii) all accessions to, substitutions for and replacements, products, and
cash and non-cash proceeds of the foregoing (including Stock Rights), including
proceeds of and unearned premiums with respect to insurance policies, and claims
against any Person for loss, damage or destruction of any Collateral; and

 

  (xiv) all books and records (including customer lists, credit files, computer
files, computer programs, tapes, printouts and other computer materials)
pertaining to the foregoing and any General Intangibles at any time evidencing
or relating to any of the foregoing;

to secure the prompt and complete payment and performance of the Secured
Obligations. Notwithstanding the foregoing, the Collateral shall not include any
Excluded Assets (but shall include proceeds of Excluded Assets unless such
proceeds themselves constitute Excluded Assets). In no event shall the grant of
the Lien by any Grantor hereunder secure an Excluded Swap Obligation of such
Grantor.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

Each Grantor represents and warrants to the Administrative Agent and the other
Secured Parties that:

3.1. Title, Perfection and Priority. Such Grantor has good and valid rights in
or the power to transfer the Collateral owned by it and title to the Collateral
with respect to which it has purported to grant a security interest hereunder,
free and clear of all Liens except for Liens permitted under Section 4.1(e), and
has full power and authority to grant to the Administrative Agent the security
interest in such Collateral pursuant hereto. As a result of the filing of a
financing statement in the appropriate office against such Grantor, the
Administrative Agent has a fully perfected, first priority security interest in
the Collateral of such Grantor in which a security interest may be perfected by
filing under the Uniform Commercial Code, subject only to Liens permitted under
Section 4.1(e). As of the First Amendment Effective Date, the appropriate office
in which to file a financing statement against such Grantor is listed on Exhibit
F. As a result of the execution and delivery of the Deposit Account Control
Agreements, Securities Account Control Agreements and other control agreements
listed on Exhibit B-II, the Administrative Agent has a duly perfected, first
priority Lien in each Deposit Account, Securities Account and Commodity Account,
other than any Excluded Account, of such Grantor by Control, subject only to
Liens permitted under Section 4.1(e).

 

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3.2. Type and Jurisdiction of Organization, Organizational and Identification
Numbers. Such Grantor’s legal name, type of entity, state of organization,
organizational number issued to it by its state of organization, if any, and
federal employer identification number, in each case as of the First Amendment
Effective Date, are set forth on Exhibit A.

3.3. Principal Location. Such Grantor’s mailing address and the location of its
place of business (if it has only one) or its chief executive office (if it has
more than one place of business), and the location of its books or records
related to any Collateral, in each case of the First Amendment Effective Date,
are disclosed in Exhibit A; as of the First Amendment Effective Date, such
Grantor has no other places of business except those set forth in Exhibit A.

3.4. Collateral Locations. All of such Grantor’s locations where Collateral
(other than Inventory in transit) was located as of the Effective Date are
listed on Exhibit A. As of the Effective Date, all of said locations were owned
by such Grantor except for locations (i) which were leased by the Grantor as
lessee and were designated in Part VII(b) of Exhibit A, (ii) at which Inventory
was held in a public warehouse or was otherwise held by a bailee or on
consignment as designated in Part VII(c) of Exhibit A or (iii) at which
Inventory was held at vendor managed locations under the control of the Grantor
and pursuant to written agreements in which the vendor acknowledges the
Grantor’s title to such Inventory as designated in Part VII(d) of Exhibit A.

3.5. Deposit Accounts, Securities Accounts, Commodities Accounts. All of such
Grantor’s Deposit Accounts, Securities Accounts and Commodities Accounts, in
each case as of the First Amendment Effective Date, are listed on Exhibit B-I.

3.6. Exact Names. Such Grantor’s name in which it has executed this Security
Agreement is the exact name as it appears in such Grantor’s organizational
documents, as amended, and as filed with such Grantor’s jurisdiction of
organization as of the First Amendment Effective Date. Such Grantor has not,
during the five years prior to the First Amendment Effective Date, been known by
or used any other corporate or fictitious name, or been a party to any merger or
consolidation, or been a party to any acquisition, in each case except as
disclosed on Exhibit A.

3.7. Letter-of-Credit Rights and Chattel Paper. Exhibit C lists all
Letter-of-Credit Rights and Chattel Paper of such Grantor in excess of
$1,000,000 as of the First Amendment Effective Date. Such Grantor has taken all
actions necessary or desirable to protect and perfect the Administrative Agent’s
Lien on each item listed on Exhibit C (including the delivery of all originals
and the placement of a legend on all Chattel Paper as required hereunder). The
Administrative Agent has a fully perfected first priority security interest in
the Collateral listed on Exhibit C, subject only to Liens permitted under
Section 4.1(e).

3.8. Accounts and Chattel Paper.

(a) The names of the obligors, amounts owing, due dates and other information
with respect to the Accounts and Chattel Paper owing to such Grantor are and
will be correctly stated in all material respects in all records of such Grantor
relating thereto and in all Collateral Reports with respect thereto furnished to
the Administrative Agent by such Grantor from time to time. As of the time when
each Account or each item of Chattel Paper arises, such Grantor shall be deemed
to have represented and warranted that such Account or Chattel Paper, as the
case may be, and all records relating thereto, are genuine and in all material
respects what they purport to be.

(b) With respect to its Accounts, except as specifically disclosed on the most
recent Collateral Report, (i) with respect to Accounts that are included in the
Borrowing Base, all such Accounts are Eligible Accounts; (ii) all Eligible
Accounts represent bona fide sales of Inventory or rendering of services to
Account Debtors in the ordinary course of such Grantor’s business and are not
evidenced by a judgment, Instrument or Chattel Paper; (iii) with respect to
Eligible Accounts, to such Grantor’s knowledge, there are no

 

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facts, events or occurrences which in any way impair the validity or
enforceability thereof or could reasonably be expected to reduce the amount
payable thereunder as shown on such Grantor’s books and records and any
invoices, statements and Collateral Reports with respect thereto; and (iv) such
Grantor has no knowledge that any Account Debtor relating to any Eligible
Account is unable generally to pay its debts as they become due.

(c) In addition, with respect to all of its Accounts, (i) the amounts shown on
all Borrowing Base Certificates and supporting information with respect thereto
are actually and absolutely owing to such Grantor as indicated thereon and are
not in any way contingent; (ii) no payments have been or shall be made thereon
except payments immediately delivered to a Collateral Deposit Account (or a
lockbox relating to a Collateral Deposit Account) as required pursuant to
Section 7.1; and (iii) to such Grantor’s knowledge, all Account Debtors have the
capacity to contract.

3.9. Inventory. With respect to any of such Grantor’s Inventory included in the
most recent Collateral Report, (a) such Inventory (other than Inventory in
transit) is located at one of such Grantor’s locations set forth on Exhibit A
except as permitted by Section 4.14, (b) such Grantor has good, indefeasible and
merchantable title to such Inventory and such Inventory is not subject to any
Lien or security interest or document whatsoever except for Liens permitted
under Section 4.1(e), (c) except as specifically disclosed in the most recent
Collateral Report, such Inventory is of good and merchantable quality in all
material respects, free from any defects, (d) such Inventory is not subject to
any IP License or other contract or agreement which would, as a result of the
Administrative Agent’s or its designee’s completion of manufacture, sale or
other disposition or advertising of that Inventory following an Event of
Default, (i) be breached or in default, (ii) require the consent of the other
party to the IP License or other contract or agreement, or (iii) require the
payment of any monies to any third party upon such manufacture, sale, or other
disposition, other than royalties, if any, in accordance with the relevant IP
License; (e) with respect to Inventory that is included in the Borrowing Base,
such Inventory is Eligible Inventory; and (f) the amounts shown therein as
Eligible Inventory have been determined as provided in the Credit Agreement.

3.10. Intellectual Property. A correct and complete list of such Grantor’s
Patents, Trademarks and material Copyrights which are the subject of a
registration or application in the United States, and any material IP Licenses
to which any Grantor is a party or to which its Patents, Copyrights, Trademarks
or trade secrets are subject (whether as licensee or licensor) is set forth on
Exhibit D. The Grantor indicated on Exhibit D as the owner of the related
Patent, Trademark or Copyright is the beneficial owner thereof. This Security
Agreement is effective to create a valid and continuing Lien and, upon
(a) filing of financing statements in the appropriate offices listed on Exhibit
F and (b) recordation of the Patent Security Agreement and the Trademark
Security Agreement with the USPTO, fully perfected first priority security
interests in favor of the Administrative Agent on such Grantor’s Patents and
Trademarks established under the laws of the United States, subject only to
Liens permitted under Section 4.1(e). This Security Agreement is effective to
create a valid and continuing Lien and, upon (a) filing of financing statements
in the appropriate offices listed on Exhibit F and (b) recordation of the
Copyright Security Agreement with the USCO, fully perfected first priority
security interests in favor of the Administrative Agent on such Grantor’s
Copyrights established under the laws of the United States, subject only to
Liens permitted under Section 4.1(e). All documents and instruments necessary,
or reasonably requested by the Administrative Agent to perfect the
Administrative Agent’s Lien on such Grantor’s Copyrights, Patents and Trademarks
shall have been delivered to the Administrative Agent by the First Amendment
Effective Date.

3.11. Filing Requirements. None of the Collateral owned by such Grantor is of a
type for which security interests or Liens may be perfected by filing under any
United States federal statute except for Patents, Trademarks and Copyrights held
by such Grantor and described in Exhibit D to the extent that the federal
intellectual property laws apply to the perfection of Liens therein.

3.12. No Financing Statements, Security Agreements. No financing statement or
security agreement describing all or any portion of the Collateral which has not
lapsed or been terminated naming such Grantor as debtor has been filed or is of
record in any jurisdiction except (a) for financing statements or security
agreements naming the Administrative Agent on behalf of the Secured Parties as
the secured party and (b) as otherwise permitted by Section 4.1(e).

 

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3.13. Pledged Collateral.

(a) Exhibit E sets forth a complete and accurate list of all Pledged Collateral
owned by such Grantor as of the First Amendment Effective Date. Such Grantor is
the direct, sole beneficial owner and sole holder of record of the Pledged
Collateral listed on Exhibit E as being owned by it, free and clear of any
Liens, except for the Liens permitted under Section 4.1(e). Such Grantor further
represents and warrants that (i) all Pledged Collateral owned by it constituting
an Equity Interest has been (to the extent such concepts are relevant with
respect to such Pledged Collateral) duly authorized, validly issued, are fully
paid and non-assessable, (ii) with respect to any certificates delivered to the
Administrative Agent or its bailee for perfection representing an Equity
Interest, either such certificates are Securities as defined in Article 8 of the
UCC as a result of actions by the issuer or otherwise, or, if such certificates
are not Securities, such Grantor has so informed the Administrative Agent so
that the Administrative Agent and/or its bailee for perfection may take steps to
perfect its security interest therein as a General Intangible, (iii) all such
Pledged Collateral held by a securities intermediary is covered by a Securities
Account Control Agreement pursuant to which the Administrative Agent or its
bailee for perfection has Control and (iv) to such Grantor’s knowledge and
except as otherwise disclosed to the Administrative Agent, all Pledged
Collateral representing Indebtedness owed to such Grantor and delivered to the
Administrative Agent or its bailee for perfection has been duly authorized,
authenticated or issued and delivered by the issuer of such Indebtedness, is the
legal, valid and binding obligation of such issuer and such issuer (subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights generally) is not in default thereunder.

(b) In addition, (i) none of the Pledged Collateral issued by a Subsidiary of
any Grantor (the “Subsidiary Pledged Collateral”) has been issued or transferred
in violation of the securities registration, securities disclosure or similar
laws of any jurisdiction to which such issuance or transfer may be subject,
(ii) there are existing no options, warrants, calls or commitments of any
character whatsoever relating to the Subsidiary Pledged Collateral or which
obligate the issuer of any Equity Interest included in the Subsidiary Pledged
Collateral to issue additional Equity Interests, and (iii) no consent, approval,
authorization, or other action by, and no giving of notice, filing with, any
governmental authority or any other Person is required for the pledge by such
Grantor of the Subsidiary Pledged Collateral pursuant to this Security Agreement
or for the execution, delivery and performance of this Security Agreement by
such Grantor, or for the exercise by the Administrative Agent of the voting or
other rights provided for in this Security Agreement or for the remedies in
respect of the Subsidiary Pledged Collateral pursuant to this Security
Agreement, except as have been obtained, taken or filed and are in full force
and effect or as may be required in connection with such disposition by laws
affecting the offering and sale of securities generally.

(c) As of the First Amendment Effective Date, except as set forth in Exhibit E,
such Grantor owns 100% of the issued and outstanding Equity Interests which
constitute Pledged Collateral owned by it.

ARTICLE IV

COVENANTS

From the date of this Security Agreement, and thereafter until this Security
Agreement is terminated, each Grantor agrees that:

4.1. General.

(a) Collateral Records. Such Grantor will maintain complete and accurate books
and records with respect to the Collateral owned by it.

(b) Authorization to File Financing Statements; Ratification. Such Grantor
hereby authorizes the Administrative Agent to file, and if requested will
deliver to the Administrative Agent, all financing statements and other
documents and take such other actions as may from time to time be necessary or

 

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reasonably requested by the Administrative Agent in order to maintain a first
priority perfected security interest in and, if applicable, Control of, the
Collateral owned by such Grantor, subject to Liens permitted under
Section 4.1(e). Any financing statement filed by the Administrative Agent may be
filed in any filing office in any UCC jurisdiction and may (i) indicate such
Grantor’s Collateral (A) as all assets of the Grantor or words of similar
effect, regardless of whether any particular asset comprised in the Collateral
falls within the scope of Article 9 of the UCC or such jurisdiction, or (B) by
any other description which reasonably approximates the description contained in
this Security Agreement, and (ii) contain any other information required by part
5 of Article 9 of the UCC for the sufficiency or filing office acceptance of any
financing statement or amendment, including (A) whether such Grantor is an
organization, the type of organization and any organization identification
number issued to such Grantor, and (B) in the case of a financing statement
filed as a fixture filing or indicating such Grantor’s Collateral as
as-extracted collateral or timber to be cut, a sufficient description of real
property to which the Collateral relates. Such Grantor also agrees to furnish
any such information to the Administrative Agent promptly upon request. Such
Grantor also ratifies its authorization for the Administrative Agent to have
filed in any UCC jurisdiction any initial financing statements or amendments
thereto if filed prior to the date hereof.

(c) Further Assurances. Such Grantor will, if so requested by the Administrative
Agent, furnish to the Administrative Agent, as often as the Administrative Agent
reasonably requests, statements and schedules further identifying and describing
the Collateral owned by it and such other reports and information in connection
with its Collateral as the Administrative Agent may reasonably request, all in
such detail as the Administrative Agent may specify. Such Grantor also agrees to
take any and all actions reasonably necessary to defend title to the Collateral
against all persons and to defend the security interest of the Administrative
Agent in its Collateral and the priority thereof against any Lien not permitted
under Section 4.1(e).

(d) Disposition of Collateral. Such Grantor will not sell, lease, license or
otherwise dispose of the Collateral owned by it except for dispositions
specifically permitted pursuant to Section 6.05 of the Credit Agreement.

(e) Liens. Such Grantor will not create, incur, or suffer to exist any Lien on
the Collateral owned by it except (i) the security interest created by this
Security Agreement, and (ii) other Liens permitted by Section 6.02 of the Credit
Agreement.

(f) Other Financing Statements. Such Grantor will not authorize the filing of
any financing statement naming it as debtor covering all or any portion of the
Collateral owned by it, except any financing statement authorized under
Section 4.1(b) and with respect to Liens permitted by Section 4.1(e). Such
Grantor acknowledges that it is not authorized to file any financing statement
or amendment or termination statement with respect to any financing statement
without the prior written consent of the Administrative Agent, subject to such
Grantor’s rights under Section 9-509(d)(2) of the UCC.

(g) Compliance with Terms. Such Grantor will perform and comply in all material
respects with all obligations in respect of the Collateral owned by it and all
agreements to which it is a party or by which it is bound relating to such
Collateral.

4.2. Accounts.

(a) Collection of Accounts. Such Grantor will collect and enforce, at such
Grantor’s sole expense, all amounts due or hereafter due to such Grantor under
the Accounts owned by it in the ordinary course of its business; provided that,
such Grantor may discount, credit, rebate or otherwise reduce the amount of
Accounts in accordance with its credit and collection policies and in the
ordinary course of business.

(b) Delivery of Invoices. Such Grantor will deliver to the Administrative Agent
promptly upon its request after the occurrence and during the continuance of an
Event of Default duplicate invoices with respect to each Account owned by it
bearing such language of assignment as the Administrative Agent shall specify.

 

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(c) Disclosure of Counterclaims. If (i) any discount, credit or agreement to
make a rebate or to otherwise reduce the amount owing on any Eligible Account
included in a Collateral Report owned by such Grantor exists or (ii) if, to the
knowledge of such Grantor, any dispute, setoff, claim, counterclaim or defense
exists or has been asserted or threatened with respect to any such Eligible
Account, such Grantor will promptly disclose (to the extent not already
disclosed in a Collateral Report) such fact to the Administrative Agent in
writing in the case of clause (i) or (ii) above in an amount in excess of
$1,000,000, individually or in the aggregate. Upon the reasonable request of the
Administrative Agent, such Grantor shall send the Administrative Agent a copy of
each credit memorandum in excess of $1,000,000, and such Grantor shall promptly
report each credit memorandum and each of the facts required to be disclosed to
the Administrative Agent in accordance with this Section 4.2(c) on the Borrowing
Base Certificates submitted by it.

(d) Electronic Chattel Paper. Such Grantor shall take all steps necessary to
grant the Administrative Agent or its bailee for perfection Control of all
Electronic Chattel Paper in accordance with the UCC and all “transferable
records” as defined in each of the Uniform Electronic Transactions Act and the
Electronic Signatures in Global and National Commerce Act.

4.3. Inventory.

(a) Maintenance of Inventory. Each Grantor will do all things necessary to
maintain, preserve, protect and keep the Inventory owned by such Grantor in good
condition and useable or saleable in the ordinary course of such Grantor’s
business, except for damaged or defective goods arising in the ordinary course
of such Grantor’s business.

(b) Returned Inventory. If an Account Debtor returns any Inventory to such
Grantor when no Event of Default exists, then such Grantor shall as soon as
practicable determine the reason for such return and shall issue a credit
memorandum to the Account Debtor in the appropriate amount all in accordance
with its ordinary course of business. Such Grantor shall as soon as practicable
report to the Administrative Agent any return involving an amount in excess of
$1,000,000. Each such report shall indicate the reasons for the returns and the
locations and condition of the returned Inventory. In the event any Account
Debtor returns Inventory to such Grantor when an Event of Default exists, such
Grantor, upon the request of the Administrative Agent, shall: (i) hold the
returned Inventory in trust for the Administrative Agent; (ii) segregate all
returned Inventory from all of its other property; (iii) dispose of the returned
Inventory solely according to the Administrative Agent’s written instructions;
and (iv) not issue any credits or allowances with respect thereto without the
Administrative Agent’s prior written consent. All returned Inventory shall be
subject to the Administrative Agent’s Liens thereon. Whenever any Inventory is
returned, the related Account shall be deemed ineligible to the extent of the
amount owing by the Account Debtor with respect to such returned Inventory and
such returned Inventory shall not be Eligible Inventory.

(c) Inventory Count; Perpetual Inventory System. Such Grantor will conduct a
count of its Inventory as required as part of such Grantor’s external public
audit, and after the occurrence and during the continuation of an Event of
Default, at such other times as the Administrative Agent requests. Such Grantor,
at its own expense, shall deliver to the Administrative Agent the results of any
material variances of Inventory counts performed by such Grantor in summary form
by location. Such Grantor will maintain a perpetual inventory reporting system
at all times.

4.4. Delivery of Instruments, Securities, Chattel Paper and Documents. Other
than with respect to any Chattel Paper, any Securities or any Instruments
constituting Collateral which (i) individually has a fair market value in an
amount less than $2,000,000 and (ii) does not exceed $10,000,000 in the
aggregate (but the foregoing shall not apply to Securities or Instruments issued
by Subsidiaries), such Grantor will (a) with respect to Collateral owned by it
on the Effective Date, deliver to the Administrative Agent or its bailee for
perfection immediately upon execution of this Security Agreement the originals
of any Chattel Paper, Securities and Instruments constituting Collateral,
(b) with respect to such Collateral acquired or otherwise obtained after the
Effective Date, hold in trust for the Administrative Agent upon receipt and
immediately thereafter deliver to the Administrative Agent or its bailee for
perfection the originals of any such Chattel Paper, Securities and

 

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Instruments constituting Collateral, (c) with respect to all Collateral, upon
the Administrative Agent’s request, deliver to the Administrative Agent or its
bailee for perfection (and thereafter hold in trust for the Administrative Agent
upon receipt and immediately deliver to the Administrative Agent or its bailee
for perfection) any Document evidencing or constituting Collateral and (d) with
respect to all such Collateral, upon the Administrative Agent’s request, deliver
to the Administrative Agent a duly executed amendment to this Security
Agreement, in the form of Exhibit G hereto (the “Amendment”), pursuant to which
such Grantor will pledge such additional Collateral. Such Grantor hereby
authorizes the Administrative Agent to attach each Amendment to this Security
Agreement and agrees that all additional Collateral owned by it set forth in
such Amendments shall be considered to be part of the Collateral.

4.5. Uncertificated Pledged Collateral. Such Grantor will cause the appropriate
issuers (and, if held with a securities intermediary, such securities
intermediary) of uncertificated securities or other types of Pledged Collateral
owned by it not represented by certificates to mark their books and records with
the numbers and face amounts of all such uncertificated securities or other
types of Pledged Collateral not represented by certificates and all rollovers
and replacements therefor to reflect the Lien of the Administrative Agent
granted pursuant to this Security Agreement. With respect to any Pledged
Collateral owned by it, such Grantor will, for Subsidiary Pledged Collateral,
take any actions necessary, or for all other Pledged Collateral, use
commercially reasonable efforts to cause (a) the issuers of uncertificated
securities which are Pledged Collateral and (b) any securities intermediary
which is the holder of any such Pledged Collateral, to cause the Administrative
Agent or its bailee for perfection to have and retain Control over such Pledged
Collateral. Without limiting the foregoing, such Grantor will, with respect to
any such Pledged Collateral held with a securities intermediary, cause such
securities intermediary to enter into a Securities Account Control Agreement
giving the Administrative Agent or its bailee for perfection Control.
Notwithstanding the foregoing, if any uncertificated securities constituting
Collateral are subsequently represented by certificates, such certificates shall
be delivered to the Administrative Agent or its bailee for perfection in
accordance with Section 4.4. Each issuer of uncertificated securities that is a
party hereto agrees that after the occurrence and during the continuance of an
Event of Default it will comply with instructions of the Administrative Agent
with respect to such uncertificated securities without further consent by the
applicable Grantor.

4.6. Pledged Collateral.

(a) Issuance of Additional Securities. Such Grantor will not permit the issuer
of an Equity Interest constituting Subsidiary Pledged Collateral owned by it to
issue additional Equity Interests, any right to receive the same or any right to
receive earnings, except to such Grantor or as permitted by the Credit
Agreement.

(b) Registration of Pledged Collateral. Such Grantor will permit any
registerable Pledged Collateral or any part thereof owned by it to be registered
in the name of the Administrative Agent or its nominee at any time at the option
of the Required Secured Parties.

(c) Exercise of Rights in Pledged Collateral.

(i) Without in any way limiting the foregoing and subject to clause (ii) below,
such Grantor shall have the right to exercise any and all voting rights and
other consensual rights relating to the Pledged Collateral owned by it for all
purposes not inconsistent with this Security Agreement, the Credit Agreement or
any other Loan Document; provided however, that no vote or other right shall be
exercised or action taken which would have the effect of impairing the rights of
the Administrative Agent in respect of such Pledged Collateral.

(ii) Such Grantor will permit the Administrative Agent or its nominee at any
time after the occurrence and during the continuation of an Event of Default,
without notice, to exercise, and the Administrative Agent shall have the right
to exercise, all voting rights or other rights relating to the Pledged
Collateral owned by it, including, without limitation, exchange, subscription or
any other rights, privileges, or options pertaining to any Equity Interest or
Investment Property constituting such Pledged Collateral as if it were the
absolute owner thereof.

 

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(iii) Such Grantor shall be entitled to collect and receive for its own use all
cash dividends and interest paid in respect of the Pledged Collateral owned by
it to the extent not in violation of the Credit Agreement other than any of the
following distributions and payments (collectively referred to as the “Excluded
Payments”): dividends and interest paid or payable other than in cash in respect
of such Pledged Collateral, and instruments and other property received,
receivable or otherwise distributed in respect of, or in exchange for, any
Pledged Collateral to the extent that the Administrative Agent does not have a
perfected security interest therein (and, if applicable, a control agreement
with respect thereto).

(iv) All Excluded Payments, whenever paid or made, shall be delivered to the
Administrative Agent to hold as Pledged Collateral and shall, if received by
such Grantor, be received in trust for the benefit of the Administrative Agent,
be segregated from the other property or funds of such Grantor, and be forthwith
delivered to the Administrative Agent as Pledged Collateral in the same form as
so received (with any necessary endorsement).

(v) The Administrative Agent will execute and deliver (or cause to be executed
and delivered) to each Grantor all such proxies and other instruments as such
Grantor may reasonably request for the purpose of enabling such Grantor to
exercise the voting and other consensual rights that it is entitled to exercise
pursuant to clause (i) above and to receive the dividends and interest payments
that it is authorized to receive and retain pursuant to paragraph (iii) above.

4.7. Intellectual Property.

(a) Such Grantor shall as soon as practicable notify the Administrative Agent if
it knows or has reason to know that any application or registration relating to
any material Patent, Trademark or Copyright (now or hereafter existing) may
become abandoned, dedicated to the public or canceled, other than by the
expiration of its non-extendable term, or of any adverse determination or
development including the institution of or any such determination or
development in, any proceeding in the USPTO, the USCO, any foreign counterpart
or any court regarding such Grantor’s ownership of any such material Patent,
Trademark or Copyright, its right to register, maintain, own, or use the same.

(b) If any Grantor, either directly or through any agent, employee, licensee or
designee, files or otherwise acquires an application or obtains a registration
for (i) any Patent or Trademark with the USPTO or (ii) any material Copyright
with the USCO, then such Grantor shall give the Administrative Agent written
notice thereof, no later than forty-five (45) Business Days after the end of the
calendar quarter in which such application is filed or acquired or such
registration issued. Each such notice shall be accompanied by the delivery to
the Administrative Agent of an executed counterpart of Exhibits H, I and J as
appropriate, and any other security agreements, financing statements, documents
or instruments as the Administrative Agent may request to evidence the
Administrative Agent’s first priority security interest (subject only to Liens
permitted under Section 4.1(e)) on such Patent, Trademark or Copyright, and the
General Intangibles of such Grantor represented thereby.

(c) Such Grantor shall take all commercially reasonable actions necessary or
requested by the Administrative Agent to maintain each of its Patents,
Trademarks and Copyright in effect, and to pursue each application, to obtain
the relevant registration and to maintain the registration of each of its
Patents, Trademarks and Copyrights (now or hereafter existing), including the
filing of applications for renewal, affidavits of use, affidavits of
noncontestability and opposition and interference and cancellation proceedings
against third parties, unless such Grantor shall reasonably determine that such
Patent, Trademark or Copyright is not material to the conduct of such Grantor’s
business and is not of material economic value or as is otherwise permitted by
the Credit Agreement.

 

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(d) Such Grantor shall, unless it shall reasonably determine that such Patent,
Trademark or Copyright is not material to the conduct of its business and is not
of material economic value, take all commercially reasonable actions to enforce
its rights therein including promptly suing for infringement, misappropriation
or dilution and to recover any and all damages for such infringement,
misappropriation or dilution, and shall take such other actions as the
Administrative Agent shall deem appropriate under the circumstances to protect
such Patent, Trademark or Copyright. In the event that such Grantor institutes
suit because any of its Patents, Trademarks or Copyrights constituting
Collateral is infringed upon, or misappropriated or diluted by a third party,
such Grantor shall comply with Section 4.8.

(e) As soon as reasonably practicable following the Effective Date, the
applicable Grantor shall take commercially reasonable actions to submit for
recording with the USPTO documents necessary to bring record ownership current
with respect to any material Patents and Trademarks beneficially owned by such
Grantor that are not standing in the name of the beneficial owner as of the
Effective Date.

4.8 Commercial Tort Claims. Such Grantor shall promptly notify the
Administrative Agent of any commercial tort claim (as defined in the UCC) in
excess of $12,500,000 acquired by it and, unless the Administrative Agent
otherwise consents, such Grantor shall enter into an amendment to this Security
Agreement, in the form of Exhibit G hereto, granting to Administrative Agent a
first priority security interest (subject only to Liens permitted under
Section 4.1(e)) in such commercial tort claim.

4.9. Letter-of-Credit Rights. If such Grantor is or becomes the beneficiary of a
letter of credit in excess of $1,000,000, it shall promptly notify the
Administrative Agent thereof and cause the issuer and/or confirmation bank to
(i) consent to the assignment of any Letter-of-Credit Rights to the
Administrative Agent or its bailee for perfection and (ii) agree to direct all
payments thereunder to a Deposit Account at the Administrative Agent or subject
to a Deposit Account Control Agreement for application in accordance with the
Intercreditor Agreement and Section 2.18 of the Credit Agreement, all in form
and substance reasonably satisfactory to the Administrative Agent.

4.10. No Interference. Such Grantor agrees that it will not interfere with any
right, power and remedy of the Administrative Agent provided for in this
Security Agreement or now or hereafter existing at law or in equity or by
statute or otherwise, or the exercise or beginning of the exercise by the
Administrative Agent of any one or more of such rights, powers or remedies.

4.11. Insurance. (a) In the event any Collateral is located in any area that has
been designated by the Federal Emergency Management Agency as a “Special Flood
Hazard Area”, such Grantor shall, within 60 days following the Effective Date or
such date as such Collateral is acquired by such Grantor (or such longer period
as the Administrative Agent may agree), purchase and maintain flood insurance on
such Collateral (including any personal property which is located on any real
property leased by such Grantor within a “Special Flood Hazard Area”).

(b) All property insurance policies required hereunder and under Section 5.09 of
the Credit Agreement shall name the Administrative Agent (for the benefit of the
Administrative Agent and the other Secured Parties) as a loss payee through
endorsements in form and substance reasonably satisfactory to the Administrative
Agent, which endorsements will provide that: (i) all proceeds thereunder with
respect to any Collateral shall be payable to the Administrative Agent as its
interest may appear; (ii) no such insurance shall be affected by any act or
neglect of the insured or owner of the property described in such policy; and
(iii) such policy may be canceled or terminated only upon, in the case of
non-payment of premium, at least 10 days, and otherwise, at least thirty days
prior written notice given to the Administrative Agent, in each case unless the
Administrative Agent shall otherwise agree (giving due consideration to what is
commercially available in the insurance market).

(c) All premiums on any insurance shall be paid when due by such Grantor, and
copies of the policies shall be delivered to the Administrative Agent upon the
Administrative Agent’s reasonable request. If such Grantor fails to obtain any
insurance as required by this Section or by Section 5.09 of the Credit

 

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Agreement, the Administrative Agent may obtain such insurance at the Borrower’s
expense. By purchasing such insurance, the Administrative Agent shall not be
deemed to have waived any Default arising from the Grantor’s failure to maintain
such insurance or pay any premiums therefor.

4.12. Collateral Access Agreements. Such Grantor shall use commercially
reasonable efforts for a period not to exceed 90 days after the Effective Date
or the date of any Permitted Acquisition (as applicable) to obtain a Collateral
Access Agreement from the lessor of each leased property, mortgagee of owned
property or bailee or consignee with respect to any warehouse, processor or
converter facility or other location where Collateral with a fair market value
in excess of $5,000,000 is stored or located, which agreement or letter shall
provide access rights, contain a waiver or subordination of all Liens or claims
that the landlord, mortgagee, bailee or consignee may assert against the
Collateral at that location, and shall otherwise be reasonably satisfactory in
form and substance to the Administrative Agent. With respect to such locations
as of the Effective Date and thereafter, if the Administrative Agent has not
received a Collateral Access Agreement as of the Effective Date (or, if later,
as of the date such location is established), the Borrower’s Eligible Inventory
at that location shall be excluded from the Borrowing Base unless a Reserve has
been established by the Administrative Agent in its Permitted Discretion.

4.13. Deposit Account Control Agreements; Securities Account Control Agreements.

(a) Such Grantor will provide to the Administrative Agent a Deposit Account
Control Agreement duly executed on behalf of each financial institution holding
a Deposit Account (other than an Excluded Account) of such Grantor; provided
that, if a financial institution refuses to enter into a Deposit Account Control
Agreement, the Administrative Agent may, in its discretion, defer delivery of
any such Deposit Account Control Agreement, establish a Reserve with respect to
any Deposit Account (other than an Excluded Account) for which the
Administrative Agent has not received such Deposit Account Control Agreement,
and require such Grantor to open and maintain a new Deposit Account (other than
an Excluded Account) with a financial institution subject to a Deposit Account
Control Agreement. Upon opening a Deposit Account such Grantor will promptly
notify the Administrative Agent of such Deposit Account.

(b) Such Grantor will provide to the Administrative Agent a Securities Account
Control Agreement duly executed on behalf of each securities intermediary
holding a Securities Account (other than an Excluded Account) of such Grantor;
provided that, if a securities intermediary refuses to enter into a Securities
Account Control Agreement, the Administrative Agent may, in its discretion,
defer delivery of any such Securities Account Control Agreement, establish a
Reserve with respect to any Securities Account (other than an Excluded Account)
for which the Administrative Agent has not received such Securities Account
Control Agreement, and require such Grantor to open and maintain a new
Securities Account (other than an Excluded Account) with a securities
intermediary subject to a Securities Account Control Agreement. Upon opening a
Securities Account such Grantor will promptly notify the Administrative Agent of
such Securities Account.

4.14. Change of Name or Location; Change of Fiscal Year. Such Grantor shall not
(a) change its name as it appears in its organizational documents and as filed
in such Grantor’s jurisdiction of organization, (b) change its chief executive
office, principal place of business, mailing address or corporate offices or
change or add warehouses or locations at which Collateral is held or stored, or
the location of its records concerning the Collateral, in each case from the
locations identified on Exhibit A, (c) change the type of entity that it is,
(d) change its organization identification number, if any, issued by its state
of incorporation or other organization, or (e) change its state of incorporation
or organization, in each case, unless the Administrative Agent shall have
received at least fifteen days (or such lesser period of time as the
Administrative Agent may agree) prior written notice of such change and the
Administrative Agent shall have acknowledged in writing that either (1) such
change will not adversely affect the validity, perfection or priority of the
Administrative Agent’s security interest in the Collateral, or (2) any
reasonable action requested by the Administrative Agent in connection therewith
has been completed or taken (including any action to continue the perfection of
any Liens in favor of the Administrative Agent, on behalf of Lenders, in any
Collateral), provided that, any new location shall be in the continental U.S.
Such Grantor shall not change its fiscal year except as permitted under the
Credit Agreement.

 

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ARTICLE V

EVENTS OF DEFAULT AND REMEDIES

5.1. Events of Default. The occurrence of any one or more of the following
events shall constitute an Event of Default hereunder:

(a) The breach by any Grantor of any of the terms or provisions of Article IV or
Article VII.

(b) The breach by any Grantor (other than a breach which constitutes an Event of
Default under any other Section of this Article V) of any of the terms or
provisions of this Security Agreement which is not remedied within thirty days
after the earlier of such Grantor’s knowledge of such breach or notice thereof
from the Administrative Agent (which notice will be given at the request of any
Secured Party).

(c) The occurrence of any “Event of Default” under, and as defined in, the
Credit Agreement.

5.2. Remedies.

(a) Upon the occurrence and during the continuation of an Event of Default, the
Administrative Agent may, and at the direction of the Required Secured Parties
shall, exercise any or all of the following rights and remedies subject to the
Intercreditor Agreement:

(i) those rights and remedies provided in this Security Agreement, the Credit
Agreement, or any other Loan Document; provided that, this Section 5.2(a) shall
not be understood to limit any rights or remedies available to the
Administrative Agent and the other Secured Parties prior to an Event of Default;

(ii) those rights and remedies available to a secured party under the UCC
(whether or not the UCC applies to the affected Collateral) or under any other
applicable law (including, without limitation, any law governing the exercise of
a bank’s right of setoff or bankers’ lien) when a debtor is in default under a
security agreement;

(iii) give notice of sole control or any other instruction under any Deposit
Account Control Agreement and any Securities Account Control Agreement and take
any action thereon with respect to such Collateral;

(iv) without notice (except as specifically provided in Section 8.1 or elsewhere
herein), demand or advertisement of any kind to any Grantor or any other Person,
enter the premises of any Grantor where any Collateral is located (through
self-help and without judicial process) to collect, receive, assemble, process,
appropriate, sell, lease, license, assign, grant an option or options to
purchase or otherwise dispose of, deliver, or realize upon, the Collateral or
any part thereof in one or more parcels at public or private sale or sales
(which sales may be adjourned or continued from time to time with or without
notice and may take place at any Grantor’s premises or elsewhere), for cash, on
credit or for future delivery without assumption of any credit risk, and upon
such other terms as the Administrative Agent may deem commercially reasonable;
and

(v) concurrently with written notice to the applicable Grantor, transfer and
register in its name or in the name of its nominee the whole or any part of the
Pledged Collateral, to exchange certificates or instruments representing or
evidencing Pledged Collateral for certificates or instruments of smaller or
larger denominations, to exercise the voting and all other rights as a holder
with respect thereto, to collect and receive all cash dividends, interest,
principal and other distributions made thereon and to otherwise act with respect
to the Pledged Collateral as though the Administrative Agent was the outright
owner thereof.

 

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(b) The Administrative Agent, on behalf of the Secured Parties, may comply with
any applicable state or federal law requirements in connection with a
disposition of the Collateral and compliance will not be considered to adversely
affect the commercial reasonableness of any sale of the Collateral.

(c) The Administrative Agent shall have the right upon any such public sale or
sales and, to the extent permitted by law, upon any such private sale or sales,
to purchase for the benefit of the Administrative Agent and the other Secured
Parties, the whole or any part of the Collateral so sold, free of any right of
equity redemption, which equity redemption the Grantor hereby expressly
releases.

(d) Until the Administrative Agent is able to effect a sale, lease, or other
disposition of Collateral, the Administrative Agent shall have the right to hold
or use Collateral, or any part thereof, to the extent that it deems appropriate
for the purpose of preserving Collateral or its value or for any other purpose
deemed appropriate by the Administrative Agent. The Administrative Agent may, if
it so elects, seek the appointment of a receiver or keeper to take possession of
Collateral and to enforce any of the Administrative Agent’s remedies (for the
benefit of the Administrative Agent and the Secured Parties), with respect to
such appointment without prior notice or hearing as to such appointment.

(e) If, after the Credit Agreement has terminated by its terms and all of the
Obligations have been paid in full, there remain Secured Obligations
outstanding, the Required Secured Parties may exercise the remedies provided in
this Section 5.2 upon the occurrence of any event which would allow or require
the termination or acceleration of any Secured Obligations pursuant to the terms
thereof.

(f) Notwithstanding the foregoing, neither the Administrative Agent nor the
other Secured Parties shall be required to (i) make any demand upon, or pursue
or exhaust any of their rights or remedies against, any Grantor, any other
obligor, guarantor, pledgor or any other Person with respect to the payment of
the Secured Obligations or to pursue or exhaust any of their rights or remedies
with respect to any Collateral therefor or any direct or indirect guarantee
thereof, (ii) marshal the Collateral or any guarantee of the Secured Obligations
or to resort to the Collateral or any such guarantee in any particular order, or
(iii) effect a public sale of any Collateral.

(g) Each Grantor recognizes that the Administrative Agent may be unable to
effect a public sale of any or all the Pledged Collateral and may be compelled
to resort to one or more private sales thereof in accordance with clause
(a) above. Each Grantor also acknowledges that any private sale may result in
prices and other terms less favorable to the seller than if such sale were a
public sale and, notwithstanding such circumstances, agrees that any such
private sale shall not be deemed to have been made in a commercially
unreasonable manner solely by virtue of such sale being private. The
Administrative Agent shall be under no obligation to delay a sale of any of the
Pledged Collateral for the period of time necessary to permit any Grantor or the
issuer of the Pledged Collateral to register such securities for public sale
under the Securities Act of 1933, as amended, or under applicable state
securities laws, even if the applicable Grantor and the issuer would agree to do
so.

5.3. Grantor’s Obligations Upon Default. Upon the request of the Administrative
Agent after the occurrence and during the continuation of a Default, each
Grantor will:

(a) assemble and make available to the Administrative Agent the Collateral and
all books and records relating thereto at any place or places specified by the
Administrative Agent, whether at a Grantor’s premises or elsewhere;

(b) permit the Administrative Agent, by the Administrative Agent’s
representatives and agents, to enter, occupy and use any premises where all or
any part of the Collateral, or the books and records relating thereto, or both,
are located, to take possession of all or any part of the Collateral or the
books and records relating thereto, or both, to remove all or any part of the
Collateral or the books and records relating thereto, or both, and to conduct
sales of the Collateral, without any obligation to pay the Grantor for such use
and occupancy;

 

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(c) prepare and file, or cause an issuer of Pledged Collateral to prepare and
file, with the Securities and Exchange Commission or any other applicable
government agency, registration statements, a prospectus and such other
documentation in connection with the Pledged Collateral as the Administrative
Agent may request, all in form and substance satisfactory to the Administrative
Agent, and furnish to the Administrative Agent, or cause an issuer of Pledged
Collateral to furnish to the Administrative Agent, any information regarding the
Pledged Collateral in such detail as the Administrative Agent may specify;

(d) take, or cause an issuer of Pledged Collateral to take, any and all actions
necessary to register or qualify the Pledged Collateral to enable the
Administrative Agent to consummate a public sale or other disposition of the
Pledged Collateral; and

(e) at its own expense, cause the independent certified public accountants then
engaged by each Grantor to prepare and deliver to the Administrative Agent and
each other Secured Party, at any time, and from time to time, promptly upon the
Administrative Agent’s request, the following reports with respect to the
applicable Grantor: (i) a reconciliation of all Accounts; (ii) an aging of all
Accounts; (iii) trial balances; and (iv) a test verification of such Accounts.

5.4. Grant of Intellectual Property License. For the purpose of enabling the
Administrative Agent to exercise the rights and remedies under this Article V
upon the occurrence and during the continuance of an Event of Default, each
Grantor hereby (a) grants to the Administrative Agent, for the benefit of the
Administrative Agent and the other Secured Parties, an irrevocable,
non-exclusive license with rights of sublicense (exercisable without payment of
royalty or other compensation to any Grantor) to use any Patents, Trademarks,
Copyrights, trade secrets and other intellectual property rights now owned or
hereafter acquired by such Grantor, and wherever the same may be located, and
including in such license access to all media in which any of the licensed items
may be recorded or stored and to all computer software and programs used for the
compilation or printout thereof; provided that the quality of the goods and
services offered under any trademarks included in such license shall be
maintained at a level substantially consistent with the quality prevailing
immediately prior to the Event of Default or any lesser standard of quality
approved by the licensor and (b) without limiting the generality of the
foregoing, irrevocably agrees that the Administrative Agent or its designee may
(i) sell or otherwise transfer any of such Grantor’s Inventory to any Person,
including, without limitation, Persons who have previously purchased the
Grantor’s Inventory from such Grantor and, in connection with any such sale or
other enforcement of the Administrative Agent’s rights under this Security
Agreement, the Administrative Agent may sell or otherwise transfer Inventory
which bears any Trademark is covered by any Patent, or exploits any Copyright in
each case, whether owned by or licensed to such Grantor, (ii) complete, or
authorize the completion of any work-in-process and affix any Trademark owned by
or licensed to such Grantor thereto and sell or otherwise transfer such
Inventory, and (iii) advertise the sale or other transfer of any inventory under
any Trademarks or Copyrights owned by or license to Grantor.

ARTICLE VI

ACCOUNT VERIFICATION; ATTORNEY-IN-FACT; PROXY

6.1. Account Verification. The Administrative Agent may at any time following
the occurrence and during the continuation of an Event of Default, in the
Administrative Agent’s own name, in the name of a nominee of the Administrative
Agent, or in the name of any Grantor communicate (by mail, telephone, facsimile
or otherwise) with the Account Debtors of any such Grantor, parties to contracts
with any such Grantor and obligors in respect of Instruments of any such Grantor
to verify with such Persons, to the Administrative Agent’s satisfaction, the
existence, amount, terms of, and any other matter relating to, Accounts,
Instruments, Chattel Paper, payment intangibles and/or other Receivables.

 

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6.2. Authorization for Secured Party to Take Certain Action.

(a) Each Grantor irrevocably authorizes the Administrative Agent at any time and
from time to time in the sole discretion of the Administrative Agent and
appoints the Administrative Agent as its attorney in fact (i) to execute on
behalf of such Grantor as debtor and to file financing statements necessary or
desirable in the Administrative Agent’s sole discretion to perfect and to
maintain the perfection and priority of the Administrative Agent’s security
interest in the Collateral, (ii) to endorse and collect any cash proceeds of the
Collateral and to endorse any and all checks, drafts, and other instruments for
the payment of money relating to the Receivables , (iii) to file any other
financing statement or amendment of a financing statement (which does not add
new collateral or add a debtor) in such offices as the Administrative Agent in
its sole discretion deems necessary or desirable to perfect and to maintain the
perfection and priority of the Administrative Agent’s security interest in the
Collateral, (iv) to contact and enter into one or more agreements with the
issuers of uncertificated securities which are Pledged Collateral or with
securities intermediaries holding Pledged Collateral as may be necessary or
advisable to give the Administrative Agent Control over such Pledged Collateral,
(v) to apply the proceeds of any Collateral received by the Administrative Agent
to the Secured Obligations as provided in Section 7.3, (vi) to discharge past
due taxes, assessments, charges, fees or Liens on the Collateral (except for
such Liens as are specifically permitted hereunder), (vii) to contact Account
Debtors for any reason, (viii) to demand payment or enforce payment of the
Receivables in the name of the Administrative Agent or such Grantor, (ix) to
sign such Grantor’s name on any invoice or bill of lading relating to the
Receivables, drafts against any Account Debtor of the Grantor, assignments and
verifications of Receivables, (x) to exercise all of such Grantor’s rights and
remedies with respect to the collection of the Receivables and any other
Collateral, (xi) to settle, adjust, compromise, extend or renew the Receivables,
(xii) to settle, adjust or compromise any legal proceedings brought to collect
Receivables, (xiii) to prepare, file and sign such Grantor’s name on a proof of
claim in bankruptcy or similar document against any Account Debtor of such
Grantor, (xiv) to prepare, file and sign such Grantor’s name on any notice of
Lien, assignment or satisfaction of Lien or similar document in connection with
the Receivables, (xv) to change the address for delivery of mail addressed to
such Grantor to such address as the Administrative Agent may designate and to
receive, open and dispose of all mail addressed to such Grantor, and (xvi) to do
all other acts and things necessary to carry out this Security Agreement; and
such Grantor agrees to reimburse the Administrative Agent on demand for any
payment made or any expense incurred by the Administrative Agent in connection
with any of the foregoing; provided that, this authorization shall not relieve
such Grantor of any of its obligations under this Security Agreement or under
the Credit Agreement.

(b) All acts of said attorney or designee are hereby ratified and approved. The
powers conferred on the Administrative Agent, for the benefit of the
Administrative Agent and other Secured Parties, under this Section 6.2 shall be
exercised in compliance with the Intercreditor Agreement and are solely to
protect the Administrative Agent’s interests in the Collateral and shall not
impose any duty upon the Administrative Agent or any other Secured Party to
exercise any such powers. The Administrative Agent agrees that, except for the
powers granted in Section 6.2(a)(i)-(vi) and Section 6.2(a)(xvi), it shall not
exercise any power or authority granted to it unless an Event of Default has
occurred and is continuing.

6.3. Proxy. EACH GRANTOR HEREBY IRREVOCABLY CONSTITUTES AND APPOINTS THE
ADMINISTRATIVE AGENT AS ITS PROXY AND ATTORNEY-IN-FACT (AS SET FORTH IN SECTION
6.2 ABOVE) WITH RESPECT TO ITS PLEDGED COLLATERAL, INCLUDING THE RIGHT TO VOTE
SUCH PLEDGED COLLATERAL, WITH FULL POWER OF SUBSTITUTION TO DO SO. IN ADDITION
TO THE RIGHT TO VOTE ANY SUCH PLEDGED COLLATERAL, THE APPOINTMENT OF THE
ADMINISTRATIVE AGENT AS PROXY AND ATTORNEY-IN-FACT SHALL INCLUDE THE RIGHT TO
EXERCISE ALL OTHER RIGHTS, POWERS, PRIVILEGES AND REMEDIES TO WHICH A HOLDER OF
SUCH PLEDGED COLLATERAL WOULD BE ENTITLED (INCLUDING GIVING OR WITHHOLDING
WRITTEN CONSENTS OF SHAREHOLDERS, CALLING SPECIAL MEETINGS OF SHAREHOLDERS AND
VOTING AT SUCH MEETINGS). SUCH PROXY SHALL BE EFFECTIVE, AUTOMATICALLY AND
WITHOUT THE NECESSITY OF ANY ACTION (INCLUDING ANY TRANSFER OF ANY SUCH PLEDGED
COLLATERAL ON THE RECORD BOOKS OF THE ISSUER THEREOF) BY ANY PERSON (INCLUDING
THE ISSUER OF SUCH PLEDGED COLLATERAL OR ANY OFFICER OR AGENT THEREOF), UPON THE
OCCURRENCE AND DURING THE CONTINUATION OF A DEFAULT.

 

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6.4. Nature of Appointment; Limitation of Duty. THE APPOINTMENT OF THE
ADMINISTRATIVE AGENT AS PROXY AND ATTORNEY-IN-FACT IN THIS ARTICLE VI IS COUPLED
WITH AN INTEREST AND SHALL BE IRREVOCABLE UNTIL THE DATE ON WHICH THIS SECURITY
AGREEMENT IS TERMINATED IN ACCORDANCE WITH SECTION 8.15. NOTWITHSTANDING
ANYTHING CONTAINED HEREIN, NEITHER THE ADMINISTRATIVE AGENT, NOR ANY OTHER
SECURED PARTY, NOR ANY OF THEIR RESPECTIVE AFFILIATES, OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS OR REPRESENTATIVES SHALL HAVE ANY DUTY TO EXERCISE ANY RIGHT
OR POWER GRANTED HEREUNDER OR OTHERWISE OR TO PRESERVE THE SAME AND SHALL NOT BE
LIABLE FOR ANY FAILURE TO DO SO OR FOR ANY DELAY IN DOING SO, EXCEPT IN RESPECT
OF DAMAGES ATTRIBUTABLE SOLELY TO THEIR OWN GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT AS FINALLY DETERMINED BY A COURT OF COMPETENT JURISDICTION; PROVIDED
THAT, IN NO EVENT SHALL THEY BE LIABLE FOR ANY PUNITIVE, EXEMPLARY, INDIRECT OR
CONSEQUENTIAL DAMAGES.

ARTICLE VII

COLLECTION AND APPLICATION OF COLLATERAL PROCEEDS; DEPOSIT ACCOUNTS

7.1. Collection of Receivables.

(a) Grantors shall maintain Collateral Deposit Accounts pursuant to lockbox and
other Control arrangements satisfactory to the Administrative Agent. Each
Grantor has executed and delivered to the Administrative Agent Deposit Account
Control Agreements for each Deposit Account and related lockbox maintained by
such Grantor into which all cash, checks or other similar payments relating to
or constituting payments made in respect of Receivables are or will be deposited
(a “Collateral Deposit Account”), which Collateral Deposit Accounts, as of the
First Amendment Effective Date, are identified as such on Exhibit B-I. Not later
than 60 days after the date of any Permitted Acquisition, each Grantor
(including any Grantor that becomes a party to this Security Agreement in
connection with such Permitted Acquisition) shall execute and deliver to the
Administrative Agent Deposit Account Control Agreements for each Collateral
Deposit Account and related lockbox acquired or created by such Grantor in
connection with such Permitted Acquisition or maintained by a Grantor that
becomes a party to this Security Agreement in connection with such Permitted
Acquisition. Each such Deposit Account Control Agreement shall waive offset
rights of the depository bank (except for customary administrative charges) and,
if applicable, require immediate deposit of all remittances received into a
related lockbox to such Collateral Deposit Account. Each Grantor will comply
with the terms of Section 7.2 with respect to any Collateral Deposit Accounts.
The Administrative Agent and the Lenders assume no responsibility to Grantors
for any Collateral Deposit Account, including any claim of accord and
satisfaction or release with respect to any cash, checks or other similar
payments relating to or constituting payments made in respect of Receivables
accepted by any bank.

(b) Each Grantor shall direct all of its Account Debtors to forward payments
directly to the Collateral Deposit Accounts or related lockboxes. If any Grantor
should refuse or neglect to notify any Account Debtor to forward payments
directly to a Collateral Deposit Account or to a related lockbox after notice
from the Administrative Agent, the Administrative Agent shall, notwithstanding
the language set forth in Section 6.2(b), be entitled to make such notification
directly to Account Debtor. If, notwithstanding the foregoing instructions, any
Grantor receives any proceeds of any Receivables, such Grantor shall receive
such payments as the Administrative Agent’s trustee, and shall immediately
deposit all cash, checks or other similar payments related to or constituting
payments made in respect of Receivables received by it to a Collateral Deposit
Account.

7.2. Covenant Regarding New Deposit Accounts. Before opening or replacing any
Collateral Deposit Account or other Deposit Account, each Grantor shall (a) open
such Collateral Deposit Account or other Deposit Account at institutions
permitted under Section 5.12 of the Credit Agreement, and (b) cause each bank or
financial institution in which it seeks to open such Deposit Account, so long as
such Deposit Account is not an Excluded Account, or such Collateral Deposit
Account to enter into a Deposit Account Control

 

22

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Agreement with the Administrative Agent in order to give the Administrative
Agent Control thereof. In the case of Deposit Accounts maintained with the
Secured Parties, the terms of such letter shall be subject to the provisions of
the Credit Agreement regarding setoffs.

7.3. Application of Proceeds; Deficiency. During any Dominion Trigger Period,
the Administrative Agent may exercise control over all Collateral Deposit
Accounts and apply all amounts deposited in the Collateral Deposit Accounts in
accordance with Section 2.10(b) of the Credit Agreement. If an Event of Default
has occurred and is continuing, the Administrative Agent may require all cash
proceeds of the Collateral not deposited in Collateral Deposit Accounts, which
are not required to be applied to the Obligations pursuant to Section 2.11 of
the Credit Agreement or Section 2.10 of the Term Loan Agreement (or any
corresponding provisions of any replacement Term Loan Agreement or any relevant
Junior Indebtedness), to be deposited in a special non-interest bearing cash
collateral account with the Administrative Agent and held there as security for
the Secured Obligations or applied as set forth in the Intercreditor Agreement
or Section 2.18 of the Credit Agreement. No Grantor shall have any control
whatsoever over said cash collateral account. Any such proceeds of the
Collateral shall be applied in the order set forth in the Intercreditor
Agreement or Section 2.18 of the Credit Agreement unless a court of competent
jurisdiction shall otherwise direct. The balance, if any, after all of the
Secured Obligations have been satisfied, shall be deposited by the
Administrative Agent into the Company’s general operating account with the
Administrative Agent. The Grantors shall remain liable for any deficiency if the
proceeds of any sale or disposition of the Collateral are insufficient to pay
all Secured Obligations, including any attorneys’ fees and other expenses
incurred by Administrative Agent or any other Secured Party to collect such
deficiency.

ARTICLE VIII

GENERAL PROVISIONS

8.1. Waivers. Each Grantor hereby waives notice of the time and place of any
public sale or the time after which any private sale or other disposition of all
or any part of the Collateral may be made. To the extent such notice may not be
waived under applicable law, any notice made shall be deemed reasonable if sent
to the Grantors, addressed as set forth in Article IX, at least ten days prior
to (i) the date of any such public sale or (ii) the time after which any such
private sale or other disposition may be made. To the maximum extent permitted
by applicable law, each Grantor waives all claims, damages, and demands against
the Administrative Agent or any other Secured Party arising out of the
repossession, retention or sale of the Collateral, except such as arise solely
out of the gross negligence or willful misconduct of the Administrative Agent or
such other Secured Party as finally determined by a court of competent
jurisdiction. To the extent it may lawfully do so, each Grantor absolutely and
irrevocably waives and relinquishes the benefit and advantage of, and covenants
not to assert against the Administrative Agent or any other Secured Party, any
valuation, stay, appraisal, extension, moratorium, redemption or similar laws
and any and all rights or defenses it may have as a surety now or hereafter
existing which, but for this provision, might be applicable to the sale of any
Collateral made under the judgment, order or decree of any court, or privately
under the power of sale conferred by this Security Agreement, or otherwise.
Except as otherwise specifically provided herein, each Grantor hereby waives
presentment, demand, protest or any notice (to the maximum extent permitted by
applicable law) of any kind in connection with this Security Agreement or any
Collateral.

8.2. Limitation on Administrative Agent’s and Other Secured Parties’ Duty with
Respect to the Collateral. The Administrative Agent shall have no obligation to
clean-up or otherwise prepare the Collateral for sale. The Administrative Agent
and each other Secured Parties shall use reasonable care with respect to the
Collateral in its possession or under its control. Neither the Administrative
Agent nor any other Secured Party shall have any other duty as to any Collateral
in its possession or control or in the possession or control of any agent or
nominee of the Administrative Agent or such other Secured Party, or any income
thereon or as to the preservation of rights against prior parties or any other
rights pertaining thereto. To the extent that applicable law imposes duties on
the Administrative Agent to exercise remedies in a commercially reasonable
manner, each Grantor acknowledges and agrees that it is commercially reasonable
for the Administrative Agent (i) to fail to incur expenses deemed significant by
the Administrative Agent to prepare Collateral for disposition or otherwise to
transform raw material or work in process into finished goods or other finished
products for

 

23

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disposition, (ii) to fail to obtain third party consents for access to
Collateral to be disposed of, or to obtain or, if not required by other law, to
fail to obtain governmental or third party consents for the collection or
disposition of Collateral to be collected or disposed of, (iii) to fail to
exercise collection remedies against Account Debtors or other Persons obligated
on Collateral or to remove Liens on or any adverse claims against Collateral,
(iv) to exercise collection remedies against Account Debtors and other Persons
obligated on Collateral directly or through the use of collection agencies and
other collection specialists, (v) to advertise dispositions of Collateral
through publications or media of general circulation, whether or not the
Collateral is of a specialized nature, (vi) to contact other Persons, whether or
not in the same business as such Grantor, for expressions of interest in
acquiring all or any portion of such Collateral, (vii) to hire one or more
professional auctioneers to assist in the disposition of Collateral, whether or
not the Collateral is of a specialized nature, (viii) to dispose of Collateral
by utilizing internet sites that provide for the auction of assets of the types
included in the Collateral or that have the reasonable capacity of doing so, or
that match buyers and sellers of assets, (ix) to dispose of assets in wholesale
rather than retail markets, (x) to disclaim disposition warranties, such as
title, possession or quiet enjoyment, (xi) to purchase insurance or credit
enhancements to insure the Administrative Agent against risks of loss,
collection or disposition of Collateral or to provide to the Administrative
Agent a guaranteed return from the collection or disposition of Collateral, or
(xii) to the extent deemed appropriate by the Administrative Agent, to obtain
the services of other brokers, investment bankers, consultants and other
professionals to assist the Administrative Agent in the collection or
disposition of any of the Collateral. Each Grantor acknowledges that the purpose
of this Section 8.2 is to provide non-exhaustive indications of what actions or
omissions by the Administrative Agent would be commercially reasonable in the
Administrative Agent’s exercise of remedies against the Collateral and that
other actions or omissions by the Administrative Agent shall not be deemed
commercially unreasonable solely on account of not being indicated in this
Section 8.2. Without limitation upon the foregoing, nothing contained in this
Section 8.2 shall be construed to grant any rights to any Grantor or to impose
any duties on the Administrative Agent that would not have been granted or
imposed by this Security Agreement or by applicable law in the absence of this
Section 8.2.

8.3. Compromises and Collection of Collateral. The Grantors and the
Administrative Agent recognize that setoffs, counterclaims, defenses and other
claims may be asserted by obligors with respect to certain of the Receivables,
that certain of the Receivables may be or become uncollectible in whole or in
part and that the expense and probability of success in litigating a disputed
Receivable may exceed the amount that reasonably may be expected to be recovered
with respect to a Receivable. In view of the foregoing, each Grantor agrees that
the Administrative Agent may at any time and from time to time, if an Event of
Default has occurred and is continuing, compromise with the obligor on any
Receivable, accept in full payment of any Receivable such amount as the
Administrative Agent in its sole discretion shall determine or abandon any
Receivable, and any such action by the Administrative Agent shall be
commercially reasonable so long as the Administrative Agent acts in good faith
based on information known to it at the time it takes any such action.

8.4. Secured Party Performance of Debtor Obligations. Without having any
obligation to do so, the Administrative Agent may perform or pay any obligation
which any Grantor has agreed to perform or pay in this Security Agreement and
the Grantors shall reimburse the Administrative Agent for any amounts paid by
the Administrative Agent pursuant to this Section 8.4. The Grantors’ obligation
to reimburse the Administrative Agent pursuant to the preceding sentence shall
be a Secured Obligation payable on demand.

8.5. Specific Performance of Certain Covenants. Each Grantor acknowledges and
agrees that a breach of any of the covenants contained in Sections 4.1(d),
4.1(e), 4.4, 4.5, 4.6, 4.7, 4.8, 4.9, 4.11, 4.12, 4.13, 4.14, 5.3, or 8.7 or in
Article VII will cause irreparable injury to the Administrative Agent and the
other Secured Parties, that the Administrative Agent and the other Secured
Parties have no adequate remedy at law in respect of such breaches and therefore
agrees, without limiting the right of the Administrative Agent or the other
Secured Parties to seek and obtain specific performance of other obligations of
the Grantors contained in this Security Agreement, that the covenants of the
Grantors contained in the Sections referred to in this Section 8.5 shall be
specifically enforceable against the Grantors.

8.6. Dispositions Not Authorized. No Grantor is authorized to sell or otherwise
dispose of the Collateral except as set forth in Section 4.1(d) and
notwithstanding any course of dealing between any Grantor

 

24

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and the Administrative Agent or other conduct of the Administrative Agent, no
authorization to sell or otherwise dispose of the Collateral (except as set
forth in Section 4.1(d)) shall be binding upon the Administrative Agent or the
other Secured Parties unless such authorization is in writing signed by the
Administrative Agent with the consent or at the direction of the Required
Secured Parties.

8.7. Certain Collateral. The Administrative Agent may, if and for so long as in
the reasonable judgment of the Administrative Agent (confirmed in writing to the
applicable Grantor) the cost of perfecting the Administrative Agent’s Lien in
any item of Collateral shall be excessive in view of the benefits to be obtained
by the Secured Parties from such perfection, excuse a Grantor from the
requirement that the Administrative Agent’s Lien in such item of Collateral be
perfected (including by way of filings in non-U.S. jurisdictions in the case of
foreign intellectual property) until such time as the Administrative Agent shall
confirm in writing to the applicable Grantor that, in the Administrative Agent’s
reasonable judgment, such situation no longer exists. Notwithstanding anything
to the contrary contained herein, (i) no Grantor shall be required to take any
action with respect to the perfection of security interests in (A) any asset
specifically requiring perfection through a control agreement or other control
arrangements other than (x) in respect of Pledged Collateral to the extent
required by Section 3.13 and (y) in respect of Deposit Accounts and Securities
Accounts to the extent required by Sections 4.13, 7.1 and 7.2 and (B) any Equity
Interests in any Immaterial Subsidiary (unless perfection of a security interest
in such Equity Interests may be achieved by the filing of financing statements
under the UCC) and (ii) no actions shall be required in order to create or
perfect any security interest in any assets located outside of the United States
(including its territories and possessions) and no foreign law security or
pledge agreements, foreign law mortgages or deeds or foreign intellectual
property filings or searches shall be required. Subject to clause (ii) of
foregoing sentence of this Section 8.7, nothing contained herein shall be
construed to (x) limit the creation or attachment of the Administrative Agent’s
Lien in any item of Collateral or (y) excuse any perfection by filing of a
financing statement.

8.8. No Waiver; Amendments; Cumulative Remedies. No delay or omission of the
Administrative Agent or any other Secured Party to exercise any right or remedy
granted under this Security Agreement shall impair such right or remedy or be
construed to be a waiver of any Default or an acquiescence therein, and any
single or partial exercise of any such right or remedy shall not preclude any
other or further exercise thereof or the exercise of any other right or remedy.
No waiver, amendment or other variation of the terms, conditions or provisions
of this Security Agreement whatsoever shall be valid unless in writing signed by
the Administrative Agent with the concurrence or at the direction of the Lenders
required under Section 9.02 of the Credit Agreement and then only to the extent
in such writing specifically set forth. All rights and remedies contained in
this Security Agreement or by law afforded shall be cumulative and all shall be
available to the Administrative Agent and the other Secured Parties until the
Secured Obligations have been paid in full.

8.9. Limitation by Law; Severability of Provisions. All rights, remedies and
powers provided in this Security Agreement may be exercised only to the extent
that the exercise thereof does not violate any applicable provision of law, and
all the provisions of this Security Agreement are intended to be subject to all
applicable mandatory provisions of law that may be controlling and to be limited
to the extent necessary so that they shall not render this Security Agreement
invalid, unenforceable or not entitled to be recorded or registered, in whole or
in part. Any provision in this Security Agreement that is held to be
inoperative, unenforceable, or invalid in any jurisdiction shall, as to that
jurisdiction, be inoperative, unenforceable, or invalid without affecting the
remaining provisions in that jurisdiction or the operation, enforceability, or
validity of that provision in any other jurisdiction, and to this end the
provisions of this Security Agreement are declared to be severable.

8.10. Reinstatement. This Security Agreement shall remain in full force and
effect and continue to be effective should any petition be filed by or against
any Grantor for liquidation or reorganization, should any Grantor become
insolvent or make an assignment for the benefit of any creditor or creditors or
should a receiver or trustee be appointed for all or any significant part of any
Grantor’s assets, and shall continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the Secured Obligations,
or any part thereof, is, pursuant to applicable law, rescinded or reduced in
amount, or must otherwise be restored or returned by any obligee of the Secured
Obligations, whether as a “voidable preference,” “fraudulent conveyance,” or
otherwise, all as though such payment or performance had not been made. In the
event that any payment, or any part thereof, is rescinded, reduced, restored or
returned, the Secured Obligations shall be reinstated and deemed reduced only by
such amount paid and not so rescinded, reduced, restored or returned.

 

25

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8.11. Benefit of Agreement. The terms and provisions of this Security Agreement
shall be binding upon and inure to the benefit of the Grantors, the
Administrative Agent and the other Secured Parties and their respective
successors and assigns (including all persons who become bound as a debtor to
this Security Agreement), except that no Grantor shall have the right to assign
its rights or delegate its obligations under this Security Agreement or any
interest herein, without the prior written consent of the Administrative Agent.
No sales of participations, assignments, transfers, or other dispositions of any
agreement governing the Secured Obligations or any portion thereof or interest
therein shall in any manner impair the Lien granted to the Administrative Agent,
for the benefit of the Administrative Agent and the other Secured Parties,
hereunder.

8.12. Survival of Representations. All representations and warranties of the
Grantors contained in this Security Agreement shall survive the execution and
delivery of this Security Agreement.

8.13. Taxes and Expenses. The Grantors shall pay or otherwise indemnify the
Administrative Agent for all U.S. federal, state or local taxes (including
income taxes), together with interest and penalties on such taxes, if any,
payable by the Administrative Agent in respect of this Security Agreement,
which, in each case, shall be governed by the terms of the Credit Agreement. For
the avoidance of doubt, the foregoing sentence shall not apply to taxes arising
from any payment made under the Credit Agreement or from the execution, delivery
or enforcement of, or otherwise with respect to, the Credit Agreement. The
Grantors shall reimburse the Administrative Agent for any and all out-of-pocket
expenses and internal charges (including reasonable attorneys’, auditors’ and
accountants’ fees and reasonable time charges of attorneys, paralegals, auditors
and accountants who may be employees of the Administrative Agent) paid or
incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, collection and enforcement of this Security
Agreement and in the audit, analysis, administration, collection, preservation
or sale of the Collateral (including the expenses and charges associated with
any periodic or special audit of the Collateral). Any and all costs and expenses
incurred by the Grantors in the performance of actions required pursuant to the
terms hereof shall be borne solely by the Grantors.

8.14. Headings. The title of and section headings in this Security Agreement are
for convenience of reference only, and shall not govern the interpretation of
any of the terms and provisions of this Security Agreement.

8.15. Termination. This Security Agreement shall continue in effect
(notwithstanding the fact that from time to time there may be no Secured
Obligations outstanding) until (i) the Credit Agreement has terminated pursuant
to its express terms and (ii) all of the Secured Obligations have been
indefeasibly paid and performed in full (or with respect to any Unliquidated
Obligations, such Unliquidated Obligations have been cash collateralized to the
satisfaction of the Administrative Agent) and no commitments of the
Administrative Agent or the other Secured Parties which would give rise to any
Secured Obligations are outstanding.

8.16. Entire Agreement. This Security Agreement embodies the entire agreement
and understanding between the Grantors and the Administrative Agent relating to
the Collateral and supersedes all prior agreements and understandings between
the Grantors and the Administrative Agent relating to the Collateral.

8.17. CHOICE OF LAW. THIS SECURITY AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE
STATE OF NEW YORK.

8.18. CONSENT TO JURISDICTION. EACH GRANTOR HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY U.S. FEDERAL OR NEW YORK STATE COURT SITTING
IN NEW YORK, NEW YORK, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT AND EACH GRANTOR HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN

 

26

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RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE
ADMINISTRATIVE AGENT OR ANY OTHER SECURED PARTY TO BRING PROCEEDINGS AGAINST ANY
GRANTOR IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY ANY
GRANTOR AGAINST THE ADMINISTRATIVE AGENT OR ANY OTHER SECURED PARTY OR ANY
AFFILIATE OF THE ADMINISTRATIVE AGENT OR ANY OTHER SECURED PARTY INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH THIS SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL BE
BROUGHT ONLY IN A COURT IN NEW YORK, NEW YORK.

8.19. WAIVER OF JURY TRIAL. EACH GRANTOR, THE ADMINISTRATIVE AGENT AND EACH
OTHER SECURED PARTY HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT,
CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH
THIS SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE RELATIONSHIP
ESTABLISHED THEREUNDER.

8.20. Indemnity. Each Grantor hereby agrees to indemnify the Administrative
Agent and the other Secured Parties, and their respective successors, assigns,
agents and employees, from and against any and all liabilities, damages,
penalties, suits, costs, and expenses of any kind and nature (including, without
limitation, all expenses of litigation or preparation therefor whether or not
the Administrative Agent or any other Secured Party is a party thereto) imposed
on, incurred by or asserted against the Administrative Agent or the other
Secured Parties, or their respective successors, assigns, agents and employees,
in any way relating to or arising out of this Security Agreement, or the
manufacture, purchase, acceptance, rejection, ownership, delivery, lease,
possession, use, operation, condition, sale, return or other disposition of any
Collateral (including, without limitation, latent and other defects, whether or
not discoverable by the Administrative Agent or the other Secured Parties or any
Grantor, and any claim for Patent, Trademark or Copyright infringement), except
to the extent any such liabilities, damages, penalties, suits, costs and
expenses are determined by a court of competent jurisdiction in a final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such person.

8.21. Release. Upon the termination of all Commitments, payment and satisfaction
in full in cash of all Secured Obligations (other than Unliquidated Obligations
so long as they are cash collateralized to the satisfaction of the
Administrative Agent), all of the Liens granted hereunder shall terminate. Upon
any sale, transfer or other disposition of any item of Collateral of any Grantor
permitted by, and in accordance with, the terms of the Credit Agreement, the
Administrative Agent shall, at such Grantor’s expense, execute and deliver to
such Grantor such documents as such Grantor shall reasonably request to evidence
the release of such item of Collateral from the assignment and security interest
granted hereby; provided, however, that such Grantor shall have delivered to the
Administrative Agent a written request for release describing the item of
Collateral and the terms of the sale, transfer or other disposition in
reasonable detail, together with a form of release for execution by the
Administrative Agent and a certificate of such Grantor to the effect that the
transaction is in compliance with the Credit Agreement and as to such other
matters as the Administrative Agent may request. Any such release shall not in
any manner discharge, affect, or impair the Secured Obligations or any Liens
(other than those expressly being released) upon (or obligations of the Loan
Parties in respect of) all interests retained by the Loan Parties, including the
proceeds to which any Loan Party has any rights of any sale, all of which shall
continue to constitute part of the Collateral.

8.22. Counterparts. This Security Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one agreement, and
any of the parties hereto may execute this Security Agreement by signing any
such counterpart. Delivery of an executed counterpart of a signature page to
this Security Agreement by facsimile or other electronic transmission (including
portable document format (“.pdf”) or similar format) shall be effective as
delivery of a manually executed counterpart of this Security Agreement.

 

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8.23. Intercreditor Agreement. In the event of any conflict between any
provision in this Security Agreement and a provision of the Intercreditor
Agreement, such provision of the Intercreditor Agreement shall prevail.

8.24. Amendment and Restatement. This Security Agreement amends and restates the
Existing Security Agreement in its entirety. The parties acknowledge and agree
that this agreement does not constitute a termination of the rights and
obligations under the Existing Security Agreement, all of which are in all
respects continuing under this Security Agreement with only the terms being
modified from and after the date hereof as provided in this Security Agreement
and Section 5 of the First Amendment.

ARTICLE IX

NOTICES

9.1. Sending Notices. Any notice required or permitted to be given under this
Security Agreement shall be sent by United States mail, telecopier, personal
delivery or nationally established overnight courier service, and shall be
deemed received (a) when received, if sent by hand or overnight courier service,
or mailed by certified or registered mail notices or (b) when sent, if sent by
telecopier (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), in each case addressed to the Grantors at
the notice address set forth on Exhibit A, and to the Administrative Agent and
the other Secured Parties at the addresses set forth in accordance with
Section 9.01 of the Credit Agreement.

9.2. Change in Address for Notices. Each of the Grantors, the Administrative
Agent and the other Secured Parties may change the address for service of notice
upon it by a notice in writing to the other parties.

ARTICLE X

THE ADMINISTRATIVE AGENT

Bank of America, N.A. has been appointed Administrative Agent for the Lenders
hereunder pursuant to Article VIII of the Credit Agreement. It is expressly
understood and agreed by the parties to this Security Agreement that any
authority conferred upon the Administrative Agent hereunder is subject to the
terms of the delegation of authority made by the Lenders to the Administrative
Agent pursuant to the Credit Agreement, and that the Administrative Agent has
agreed to act (and any successor Administrative Agent shall act) as such
hereunder only on the express conditions contained in such Article VIII. Any
successor Administrative Agent appointed pursuant to Article VIII of the Credit
Agreement shall be entitled to all the rights, interests and benefits of the
Administrative Agent hereunder.

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the Grantors and the Administrative Agent have executed this
Amended and Restated Pledge and Security Agreement as of the date first above
written.

 

GRANTORS:

INTERLINE BRANDS, INC.,

a New Jersey corporation

By:  

 

  Name:   Title:

WILMAR FINANCIAL, INC.,

a Delaware corporation

By:  

 

  Name:   Title:

GLENWOOD ACQUISITION LLC,

a Delaware limited liability company

By:  

 

  Name:   Title: JANPAK, LLC, a West Virginia limited liability company By:  

 

  Name:   Title:

Signature Page to Amended and Restated Pledge and Security Agreement

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

 

JANPAK OF SOUTH CAROLINA, LLC, a South Carolina limited liability company By:  

 

  Name:   Title: JANPAK OF TEXAS, LLC, a Texas limited liability company By:  

 

  Name:   Title: IBI MERCHANDISING SERVICES, INC., a Delaware corporation By:  

 

  Name:   Title: ZIP TECHNOLOGY, LLC, a West Virginia limited liability company
By:  

 

  Name:   Title:

Signature Page to Amended and Restated Pledge and Security Agreement

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

BANK OF AMERICA, N.A., as Administrative Agent By:  

 

  Name:   Title:

Signature Page to Amended and Restated Pledge and Security Agreement

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

EXHIBIT A

(See Sections 3.2, 3.3, 3.4, 3.6, 3.9 and 9.1 of Security Agreement)

 

   NOTICE ADDRESS FOR ALL GRANTORS      

Interline Brands, Inc.

701 San Marco Boulevard

Jacksonville, FL 32207 U.S.A.

Attention: Treasurer

Facsimile: 1-856-505-1679

  

INFORMATION AND COLLATERAL LOCATIONS OF INTERLINE BRANDS, INC.

 

I. Name of Grantor: Interline Brands, Inc.

 

II State of Incorporation or Organization: New Jersey

 

III. Type of Entity: Corporation

 

IV. Organizational Number assigned by State of Incorporation or Organization:
0100077767

 

V. Federal Identification Number:

 

VI, Place of Business (if it has only one) or Chief Executive Office (if more
than one place of business) and Mailing Address:

Interline Brands, Inc.

701 San Marco Boulevard

Jacksonville, FL 32207 U.S.A.

Attention: Treasurer

 

VII. Locations of Collateral:

 

  (a) Properties Owned by the Grantor:

 

  1. 1800 Research Drive

Louisville, KY 40299

 

  2. 77 Rodeo Drive

Brentwood, NY 11717

 

  3. 801 W. Bay Street

Jacksonville, FL 32204

 

1

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  (b) Properties Leased by the Grantor (Include Landlord’s Name):

 

Loan Party

  

Address

  

City

  

State

  

Zip Code

  

Landlord / Owner if Leased

Interline Brands, Inc.    5750 Bell Circle    Montgomery    AL    36116    KYSER
PROPERTIES Interline Brands, Inc.    1590 East Riverview Drive    Phoenix    AZ
   85034    First Industrial LP Interline Brands, Inc.    5961 Outfall Circle   
Sacramento    CA    95828    Oates Investments Interline Brands, Inc.    1110 E
Mill Street    San Bernardino    CA    92408    Hillwood Investments / Westgate
#1 LP Interline Brands, Inc.    650 Brennan St.    San Jose    CA    95131   
PEC Brennan LLC Interline Brands, Inc.    6881 District Blvd. #F    Bakersfield
   CA    93313    UCM / Titan Baker Interline Brands, Inc.    8717 Complex Drive
   San Diego    CA    92123    Uznanski Interline Brands, Inc.    230 Harris
Avenue, #11    Sacramento    CA    95838    The Hofman Irrevocable Trust
Interline Brands, Inc.    1155 East North Avenue, Suite 104    Fresno    CA   
93725    Denken Farms, A California Limited Partnership Interline Brands, Inc.
   5635 Union Pacific Ave.    Commerce    CA    90022    Telacu NW Five, Inc.
Interline Brands, Inc.    295 71st Avenue    Greeley    CO    80634   
Northward, LLC Interline Brands, Inc.    1107 South Santa Fe Avenue    Pueblo   
CO    81006    Cecil H. Brown and Beverly Ann Brown Interline Brands, Inc.   
1953 Gun Club Rd.    Aurora    CO    80019    Blount Island Partners, LLC
Interline Brands, Inc.    2414 4th Ave    Greeley    CO    80631    4 by 4, LLC
Interline Brands, Inc.    1301 South Jason Street, Unit C    Denver    CO   
80223    MIPCO Interline Brands, Inc.    701 San Marco Blvd.    Jacksonville   
FL    32207    Prudential Insurance Interline Brands, Inc.    3031 N. Andrews
Ave    Pompano Beach    FL    33064    SAMPLE AT PARK CENTRAL Interline Brands,
Inc.    12180 Metro Parkway    Ft. Meyers    FL    33912    Pyramid II
Janitorial Supplies and Equipment, Inc. Interline Brands, Inc.    1919 NW 82nd
Avenue    Doral    FL    33126    Adler Office Associates, Ltd. Interline
Brands, Inc.    4071-4075 Seaboard Road    Orlando    FL    32808    RREEF
America REIT II Interline Brands, Inc.    207 Kelsey Lane - Suite A    Tampa   
FL    33619    Eastgroup Properties, Inc. Interline Brands, Inc.    3215 SW 22nd
Street    Pembroke Pines    FL    33023    KTR Seneca II LLC

 

2

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

Loan Party

  

Address

  

City

  

State

  

Zip Code

  

Landlord / Owner if Leased

Interline Brands, Inc.    1500 N Florida Mango Rd. Suite 1    West Palm Beach   
FL    33409    DCM & Associates Interline Brands, Inc.    4601 Bull’s Bay Hwy   
Jacksonville    FL    32219    Stone Mountain Industrial Park Interline Brands,
Inc.    1500 Beach Boulevard, Suites 314-318    Jacksonville Beach    FL   
32250    Robert E. Poland and Jacqueline M. Poland Family Limited Partnership
Interline Brands, Inc.    6875C Best Friend Road Suite 100    Doraville    GA   
30340    Prologis Interline Brands, Inc.    11159 Aurua Avenue    Urbandale   
IA    50322    R&R INVESTORS Interline Brands, Inc.    304 S. 20th Street   
Fairfield    IA    52556    Farris Properties Interline Brands, Inc.    1223
West 76th Street    Davenport    IA    52806    JCO Properties Interline Brands,
Inc.    4840 Colt Road    Rockford    IL    61109    Harris N.A. Rockford as
Trustee of the Trust #41-1409-00-6 Interline Brands, Inc.    8700 N. Allen Road
   Peoria    IL    61612    VONACHEN ENTERPRISES Interline Brands, Inc.    2401
West Herrin Ave    Herrin    IL    62948    AGRACEL, INC. Interline Brands, Inc.
   1100 North Lombard RD    Lombard    IL    60148    AMB US Logistics Interline
Brands, Inc.    8707 North By N.E. Blvd. #300    Fishers    IN    46038   
Meritex NxNE LLC Interline Brands, Inc.    10806 West 78th Street    Shawnee   
KS    66214    BK Properties, LLC Interline Brands, Inc.    4829 Jennings Lane
   Louisville    KY    40218    Holly Investors Interline Brands, Inc.    601
Edwards Avenue Suite B    Harahan    LA    70123    RM Realty Interline Brands,
Inc.    26 Millbury St    Auburn    MA    01501    Quest 26 Millbury, LLC
Interline Brands, Inc.    378 Commercial Street Unit C    Malden    MA    02148
   Well-Com (Combined Properties) Interline Brands, Inc.    6403 Amendale Road
   Beltsville    MD    20705    Nazario Family LLC Interline Brands, Inc.   
23975 Research Drive    Farmington Hills    MI    48335    BGB Assoc Interline
Brands, Inc.    26411 Crestview Court    Farmington Hills    MI    48335   
Segal Investments Interline Brands, Inc.    23028 Commerce Drive    Farmington
Hills    MI    48335    First Industrial LP Interline Brands, Inc.    1930
Energy Park Drive    St. Paul    MN    55108    AMB Property LP

 

3

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

Loan Party

  

Address

  

City

  

State

  

Zip Code

  

Landlord / Owner if Leased

Interline Brands, Inc.    8461 Mid County Industrial Dr.    St. Louis    MO   
63114    Cobalt Industrial REIT Interline Brands, Inc.    312 1st Ave S    Great
Falls    MT    59403    CASCADE LEASING Interline Brands, Inc.    2205 South Ave
W    Missoula    MT    59801    A&J PARTNERSHIP / MISSOULA Interline Brands,
Inc.    7010-A Reames Road    Charlotte    NC    28216    CK North Park /
Childress Klein Interline Brands, Inc.    407 Glasgow    Aberdeen    NC    28315
   Jeanne Lally (53%) and Gerald Lally (47%) Interline Brands, Inc.    6260
Abbott Drive    Omaha    NE    68110    BS HOLDINGS, INC. Interline Brands, Inc.
   4616 Pierce Drive    Lincoln    NE    68504    PIERCE DRIVE, LLC Interline
Brands, Inc.    804 East Gate Drive    Mt Laurel    NJ    08057    EXETER
Interline Brands, Inc.    1 Avenue A    Carlsdadt    NJ    07072    Ditobarbi
Interline Brands, Inc.    515 Heron Drive Pureland Industrial Park    Swedesboro
   NJ    08085    Baker Properties Interline Brands, Inc.    80 Twinbridge Drive
   Pennsauken    NJ    08110    Bloom Orz – EAGLE Interline Brands, Inc.    4031
Industrial Center Dr. #701    North Las Vegas    NV    89030    Prologis
Interline Brands, Inc.    Tower 1, Suite 406    Las Vegas    NV    89106    WMCV
Phase I, LLC Interline Brands, Inc.    5585 S. Valley View Blvd., Suite 3    Las
Vegas    NV    89118    Sanfuchi Partnership Interline Brands, Inc.    570
Taxter Road    Elmsford    NY    10523    Mack-Cali Realty Interline Brands,
Inc.    2395 International St.    Columbus    OH    43228    JAL Realty
Interline Brands, Inc.    7640 Hub Prkwy    Valley View    OH    44125   
Carnegie Companies Interline Brands, Inc.    3225 Chester Avenue    Cleveland   
OH    44114    3209 Chester LLC Interline Brands, Inc.    4650 Lake Forest Dr.
Suite 400    Cincinnati    OH    45242    Cabot III – OH2M01-M02, LLC Interline
Brands, Inc.    5727 South Lewis Ave, Suite 705    Tulsa    OK    74105   
PRINCIPLE EQUITY PROPERTIES Interline Brands, Inc.    1830 N 109th East Ave   
Tulsa    OK    74116    EVE PROPERTIES Interline Brands, Inc.    7933 S. W. 34th
Street    Oklahoma City    OK    73179    FLRF.INC

 

4

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

Loan Party

  

Address

  

City

  

State

  

Zip Code

  

Landlord / Owner if Leased

Interline Brands, Inc.    3989 Crater Lake Highway    Medford    OR    97504   
SECURITY LAND & INVESTMENTS Interline Brands, Inc.    700 Conger Street   
Eugene    OR    97402    JLH PROPERTIES Interline Brands, Inc.    2921 22nd
Street SE    Salem    OR    97302    NATHAN LEVIN Interline Brands, Inc.   
10608 SW Industrial Way    Tualatin    OR    97062    TRI-COUNTY INDUSTRIAL
Interline Brands, Inc.    133 Westgate Drive    Beaver Falls    PA    15010   
133 Westgate LLC Interline Brands, Inc.    33 Runway Drive    Levittown    PA   
19057    F. Greek Bristol Properties Interline Brands, Inc.    Calle C Lot 3
Corujo Ind. Park, Hato Tejas    Bayamon    PR    00956    WPR Hato Tejas
Interline Brands, Inc.    1307 National Cemetery    Florence    SC    29506   
MNOP, INC Interline Brands, Inc.    2701 Eugenia Avenue    Nashville    TN   
37211    E. Warner Bass and Robert J. Walker Interline Brands, Inc.    50
Teledyne Place    LaVergne    TN    37086    Westport Investment Group Interline
Brands, Inc.    7110 Old Katy Road    Houston    TX    77024    Prisa
Acquisition Interline Brands, Inc.    3115 N. Great Southwest Parkway, Suite 100
   Grand Prairie    TX    75050    MEPT Gateway Interline Brands, Inc.    4740
Perrin Creek Suite 400    San Antonio    TX    78217    Prologis Interline
Brands, Inc.    7145 Industrial Ave. “Rear”    El Paso    TX    79915   
National Realty Group & NCC Interline Brands, Inc.    1110 W Washington St   
Paris    TX    75460    JG PROPERTIES Interline Brands, Inc.    1514 E. Frank
Street    Lufkin    TX    75904    PERRY BROTHERS Interline Brands, Inc.    4848
Perrin Creek Suite 640    San Antonio    TX    75050    Prologis Interline
Brands, Inc.    123 Nakoma Street    San Antonio    TX    78219    Cavender &
Hill Interline Brands, Inc.    1420 South 4800 West    Salt Lake City    UT   
84014    Natomas Meadows LLC Interline Brands, Inc.    6000 Eastport Blvd   
Richmond    VA    23231    Liberty Property LTD Share Interline Brands, Inc.   
1149 Andover Park West    Seattle    WA    98188    Walton Southcenter Interline
Brands, Inc.    201 N. 2nd Avenue    Yakima    WA    98902    ROBERT F. SINCLAIR

 

5

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

Loan Party

  

Address

  

City

  

State

  

Zip Code

  

Landlord / Owner if Leased

Interline Brands, Inc.    3421 N Haven    Spokane    WA    99207    A&J
PARTNERSHIP / SPOKANE Interline Brands, Inc.    3310 E. Acorn Lane    Port
Angeles    WA    98362    NORTH OLYMPIC BUILDING Interline Brands, Inc.    18027
Highway 99, Suite G    Lynnwood    WA    98037    INGRAHAM CONST.

 

  (c) Public Warehouses or other Locations Pursuant to Bailment or Consignment
Arrangements

(include name of Warehouse Operator or other Bailee or Consignee):

None.

 

  (d) Vendor Managed Locations Under the Control of the Grantor:

 

Name of Person / Entity in Possession of Collateral

  

Address

  

City

  

State

  

Zip Code

Benjamin Franklin Plbg (Rohnert Park, CA)-173    517 Jacoby St., Suite #9    San
Rafael    CA    94901 Mike Cottle Plbg (Cole Services)-189    10652 Trask Ave   
Garden Grove    CA    92843 Schuelke Plumbing    7243 Woodley Ave    Van Nuys   
CA    91406 Dutton Plumbing    675 Cochran Street    Simi Valley    CA    93065
AAA Service Plumbing    5550 Marshall St    Denver    CO    80002 Brothers
Plumbing & Heating    12249 Pennsylvania St.    Thornton    CO    80241 Calvert
Mechanical, DE-92    410 Meco Dr    Wilmington    DE    19804 Boulden Services
   714 Interchange Blvd.    Newark    DE    19711 Sobieski Services    3 N.
Colonial Ave    Wilmington    DE    19805 Scott’s Services-177    5808 N 56th
Street    Tampa    FL    33610 Midway Services-183    4677 118th Ave N   
Clearwater    FL    33762 Plumbing Experts Boca Raton)-188    1060 Holland Dr
Suite B    Boca Raton    FL    33487 Aqua Plumbing (Sarasota)-196    8283 Vico
Ct    Sarasota    FL    34230 Rainaldi Plumbing    6111 Old Cheney Hwy   
Orlando    FL    32807 Mister Sparky- FL    6301 Porter Rd. Unit 10    Sarasota
   FL    34240 NM Cool    6150 Clark Center Ave.    Sarasota    FL    32438 Mike
Douglas    517 Paul Morris Dr. Suite A    Englewood    FL    34223 Red Carpet
Plumbing    905 E 128TH AVE    TAMPA    FL    33612 ART PLBG & AIR CONDITIONING
   12438 WILES ROAD    CORAL SPRINGS    FL    33076 Marietta, GA Mister
Sparky-77    2064 Canton Road    Marietta    GA    30066 Strictly Plumbing   
3535 Industrial Avenue    Marion    IA    52302 Service Gas (Dekalb, IL)-172   
17742 Somonauk Road    Dekalb    IL    60115 Precision Plumbing-178    1051 N
Main St    Lombard    IL    60148 SPENGLER PLUMBING    1402 FRONTAGE RD   
OFALLON    IL    62269

 

6

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

Name of Person / Entity in Possession of Collateral

  

Address

  

City

  

State

  

Zip Code

Blue Dot, Topeka KS    3365 SW Gage Blvd    Topeka    KS    66614 Tade Plumbing
   2825 E KELLOGG DR    Wichita    KS    67211 Drexler Plumbing    2232
Bardstown Road    Louisville    KY    40205 MURPHY SERVICES, INC    34 WHITES
PATH    SOUTH YARMOUTH    MA    02664 Ben Franklin, Mt Airy-209    2702 Back
Acre Cir St110    Mt. Airy    MD    21771 MacGregor Plbg & Htg-181    235
Franklin Park    Harbor Springs    MI    49740 Thornton and Grooms- 221    24565
Hallwood Ct.    Farmington Hills    MI    48335 Ben Franklin of Minneapolis   
1427 Washington Ave. N    Minneapolis    MN    55411 Advanced Comfort Systems   
1000 Cape Hickory Rd    Hickory    NC    28601 Gold Medal (VMI) - 167    11
Cotters Lane    E. Brunswick    NJ    08816 Weltman Services    80 Industrial
Road    Berkley Heights    NJ    07922 CARTWRIGHT’S PLUMBING HEATING & COOLING
   7510 MALLARD WAY    SANTA FE    NM    87507 Pippin Brothers    207 SE D Ave
   Lawton    OK    73501 Roher One Hour, PA-88    516 Running Pump Road   
Lancaster    PA    17603 Essig Plumbing-210    1701 Fairview St    Reading    PA
   19606 Gillece Services, Bridgeville, PA    3000 Washington Pike   
Bridgeville    PA    15017 Meetze Plbg-193    10009 Broad River Rd    Irmo    SC
   29063 ARS-NASHVILLE    4071 POWELL AVE    NASHVILLE    TN    37204 Abacus
Plumbing-199    11431 Tood St    Houston    TX    77055 McDaniel & Sons-205   
7501 Highway 287, Ste.B1    Arlington    TX    76001 Any Hour Inc.    1374 W 130
S    Orem    UT    84058 Whipple Service Champions    963 W. Folsom Ave.    Salt
Lake City    UT    84104 Superior Water & Air    3536 South 1950 West    West
Valley City    UT    84119 Manassas (Furr), VA - 96    9040 Mike Garcia Drive   
Manassas    VA    20109 Superior Heating-179    6418 Old Meetze Rd. Suite E   
Warrenton    VA    20186 Fraiser’s Plumbing-168    310 N Brown St    Rhinelander
   WI    54501

 

VIII. Prior Names: During the five years prior to the First Amendment Effective
Date, the Grantor has not been known by or used any other corporate or
fictitious name, except:

None.

 

IX. Prior Mergers or Other Acquisitions: In the five years preceding the First
Amendment Effective Date, the Grantor has not been a party to any merger or
consolidation or been a party to any acquisition except:

 

Borrower / Subsidiary

  

Name of Entity

  

Action

  

Date of

Action

  

Jurisdiction
of Formation

Interline Brands, Inc., a New Jersey Corporation    Eagle Maintenance Supply,
Inc.    Eagle Maintenance Supply, Inc. was purchased by the Company   
08/21/2008    New Jersey

 

7

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Borrower / Subsidiary

  

Name of Entity

  

Action

  

Date of

Action

  

Jurisdiction
of Formation

Interline Brands, Inc., a New Jersey Corporation    AmSan LLC    Amsan LLC a
wholly owned subsidiary of the Company was merged with the Company, with the
Company as the surviving corporation    12/26/2008    Delaware Interline Brands,
Inc., a New Jersey Corporation    Eagle Maintenance Supply, Inc.    Eagle
Maintenance Supply, Inc. a wholly owned subsidiary of the Borrower was merged
with the Borrower, with the Borrower as the surviving corporation    12/25/2009
   New Jersey Interline Brands, Inc., a New Jersey Corporation    JanPak, Inc.
   JanPak, Inc. was acquired by the Borrower. On 12/23/2013, JanPak, Inc. was
converted from a corporation to a limited liability company and was renamed
JanPak, LLC.    12/11/2012    West Virginia Interline Brands, Inc., a New Jersey
Corporation    JanPak of Texas, Inc.    JanPak of Texas, Inc. was acquired by
the Borrower. On 12/23/2013, JanPak of Texas, Inc. was converted from a
corporation to a limited liability company and was renamed JanPak of Texas, LLC.
   12/11/2012    Texas Interline Brands, Inc., a New Jersey Corporation   
JanPak of South Carolina, Inc.    JanPak of South Carolina, Inc. was acquired by
the Borrower. On 12/23/2013, JanPak of South Carolina, Inc. was converted from a
corporation to a limited liability company and was renamed JanPak of South
Carolina, LLC.    12/11/2012    South Carolina Interline Brands, Inc., a New
Jersey Corporation    Zip Technology, Inc.    Zip Technology, Inc. was acquired
by the Borrower. On 12/23/2013, Zip Technology, Inc. was converted from a
corporation to a limited liability company and was renamed Zip Technology, LLC.
   12/11/2012    West Virginia Interline Brands, Inc., a New Jersey Corporation
   Wilmar Holdings, Inc.    Wilmar Holdings, Inc. a wholly owned subsidiary of
the Borrower was merged with the Borrower, with the Borrower as the surviving
corporation.    04/04/2013    New Jersey Interline Brands, Inc., a New Jersey
Corporation    CleanSource, Inc.    The assets of CleanSource, Inc. were
purchased by the Borrower.    10/29/2010    California Interline Brands, Inc., a
New Jersey Corporation    Northern Colorado Paper, Inc.    The assets of
Northern Colorado Paper, Inc. were purchased by the Borrower.    01/28/2011   
Colorado

 

8

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

Borrower / Subsidiary

  

Name of Entity

  

Action

  

Date of

Action

  

Jurisdiction
of Formation

Interline Brands, Inc., a New Jersey Corporation    Pyramid II Janitorial
Supplies and Equipment, Inc.    The assets of Pyramid II Janitorial Supplies and
Equipment, Inc. were purchased by the Borrower.    07/01/2012    Florida

 

9

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

INFORMATION AND COLLATERAL LOCATIONS OF WILMAR FINANCIAL, INC.

 

I. Name of Grantor: Wilmar Financial, Inc.

 

II. State of Incorporation or Organization: Delaware

 

III. Type of Entity: Corporation

 

IV. Organizational Number assigned by State of Incorporation or Organization:
2727105

 

V. Federal Identification Number:

 

VI. Place of Business (if it has only one) or Chief Executive Office (if more
than one place of business) and Mailing Address:

Wilmar Financial, Inc.

701 San Marco Boulevard

Jacksonville, FL 32207 U.S.A.

Attention: Treasurer

 

VII. Locations of Collateral:

 

  (a) Properties Owned by the Grantor:

None.

 

  (b) Properties Leased by the Grantor (Include Landlord’s Name):

None.

 

  (c) Public Warehouses or other Locations pursuant to Bailment or Consignment
Arrangements (include name of Warehouse Operator or other Bailee or Consignee):

None.

 

  (d) Vendor Managed Locations Under the Control of the Grantor:

None.

 

VIII. Prior Names: During the five years prior to the First Amendment Effective
Date, the Grantor has not been known by or used any other corporate or
fictitious name, except:

None.

 

IX. Prior Mergers or Other Acquisitions: In the five years preceding the First
Amendment Effective Date, the Grantor has not been a party to any merger or
consolidation or been a party to any acquisition except:

None.

 

10

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

INFORMATION AND COLLATERAL LOCATIONS OF IBI MERCHANDISING SERVICES, INC.

 

I. Name of Grantor: IBI Merchandising Services, Inc.

 

II. State of Incorporation or Organization: Delaware

 

III. Type of Entity: Corporation

 

IV. Organizational Number assigned by State of Incorporation or Organization:
5263667

 

V. Federal Identification Number:

 

VI. Place of Business (if it has only one) or Chief Executive Office (if more
than one place of business) and Mailing Address:

Interline Brands, Inc.

701 San Marco Boulevard

Jacksonville, FL 32207 U.S.A.

Attention: Treasurer

 

VII. Locations of Collateral:

 

  (a) Properties Owned by the Grantor:

None.

 

  (b) Properties Leased by the Grantor (Include Landlord’s Name):

None.

 

  (c) Public Warehouses or other Locations Pursuant to Bailment or Consignment
Arrangements (include name of Warehouse Operator or other Bailee or Consignee):

None.

 

  (d) Vendor Managed Locations Under the Control of the Grantor:

None.

 

VIII. Prior Names: During the five years prior to the First Amendment Effective
Date, the Grantor has not been known by or used any other corporate or
fictitious name, except:

None.

 

IX. Prior Mergers or Other Acquisitions: In the five years preceding the First
Amendment Effective Date, the Grantor has not been a party to any merger or
consolidation or been a party to any acquisition (other than the Merger),
except:

None.

 

11

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INFORMATION AND COLLATERAL LOCATIONS OF GLENWOOD ACQUISITION LLC

 

I. Name of Grantor: Glenwood Acquisition LLC

 

II. State of Incorporation or Organization: Delaware

 

III. Type of Entity: Limited liability company

 

IV. Organizational Number assigned by State of Incorporation or Organization:
3641125

 

V. Federal Identification Number:

 

VI. Place of Business (if it has only one) or Chief Executive Office (if more
than one place of business) and Mailing Address:

Glenwood Acquisition LLC

701 San Marco Boulevard

Jacksonville, FL 32207 U.S.A.

Attention: Treasurer

 

VII. Locations of Collateral:

 

  (a) Properties Owned by the Grantor:

None.

 

  (b) Properties Leased by the Grantor (Include Landlord’s Name):

None.

 

  (c) Public Warehouses or other Locations pursuant to Bailment or Consignment
Arrangements (include name of Warehouse Operator or other Bailee or Consignee):

None.

 

  (d) Vendor Managed Locations Under the Control of the Grantor:

None.

 

VIII. Prior Names: During the five years prior to the First Amendment Effective
Date, the Grantor has not been known by or used any other corporate or
fictitious name, except:

None.

 

IX. Prior Mergers or Other Acquisitions: In the five years preceding the First
Amendment Effective Date, the Grantor has not been a party to any merger or
consolidation or been a party to any acquisition except:

None.

 

12

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

INFORMATION AND COLLATERAL LOCATIONS OF JANPAK, LLC

 

I. Name of Grantor: JanPak, LLC

 

II. State of Incorporation or Organization: West Virginia

 

III. Type of Entity: Limited liability company

 

IV. Organizational Number assigned by State of Incorporation or Organization:
None.

 

V. Federal Identification Number:

 

VI. Place of Business (if it has only one) or Chief Executive Office (if more
than one place of business) and Mailing Address:

Chief Executive Office and Mailing Address

701 San Marco Boulevard

Jacksonville, FL 32207 U.S.A.

Attention: Treasurer

 

VII. Locations of Collateral:

 

  (a) Properties Owned by the Grantor:

 

  1. 100 Bluefield Avenue, Bluefield, WV 24701 (3.84 acre property with one
building of approx. 100,000 sq. ft.; JanPak, LLC owns 2.86 acres of the
property)

 

  2. 101 Industrial Park, Bristol, TN 37621 (5.11 acre property with one
building of approx. 57,600 sq. ft.)

 

  (b) Properties Leased by the Grantor (Include Landlord’s Name):

 

Loan Party

  

Address

  

City

  

State

  

Zip Code

  

Landlord / Owner if Leased

JanPak, LLC    8075 Troon Circle, Suite A1    Austell    GA    30168    CRP-2
Holdings CC, LP JanPak, LLC    Shelby West Commerce Center 175 Airview Lane,
Suite 100    Alabaster    AL    35007    Shelby West Industrial Enterprises II,
LLC JanPak, LLC    1504 E 34th Street    Chattanooga    TN    37407    Advance
Paper Company JanPak, LLC    610 Kelsey Court, Suite 100    West Columbia    SC
   29172    MV Southeast LLC JanPak, LLC    705 Griffith Street    Davidson   
SC    28036    The 705 Company LLC JanPak, LLC    6356 Clara Road, Suite 100   
Houston    TX    77041    ProLogis Texas III LLC JanPak, LLC    1140 Jordan Road
Northeast    Huntsville    AL    35811    West Huntsville Land Co. JanPak, LLC
   6600 Pritchard Road    Jacksonville    FL    32254    Welsh/Republic
Pritchard Road LLC JanPak, LLC    7780 Westside Industrial Drive1   
Jacksonville    FL    32219    Stone Mountain Industrial Park, Inc. JanPak, LLC
   950 Gills Drive, Suite 100    Orlando    FL    32824    Liberty Property
Limited Partnership

 

1  The property will be vacated and the lease terminated by December 14, 2012.

 

13

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

Loan Party

  

Address

  

City

  

State

  

Zip Code

  

Landlord / Owner if Leased

JanPak, LLC    1091 Gills Drive    Orlando    FL    32824    Auto Boat Storage
Inc. JanPak, LLC    3915 Twin City Highway    Port Arthur    TX    77642    Dr.
James T. Shepherd JanPak, LLC    550 Northridge Park Drive    Rural Hall    NC
   27045    FAWN Industrial LLC JanPak, LLC    110 Innovation Drive   
Summerville    SC    29483    Quattlebaum Development Company, L.L.C. JanPak,
LLC    264 Proctor Road    Rossville    GA    30741    Highpoint Properties LLC
JanPak, LLC    185 North Gifford Lane    Richfield    NC    28137    W Lee
Simmons and Associates; W. Lee Simmons & Sonya Simmons JanPak, LLC    6144
Little Seven Mile Road    Huntington    WV    25702    James P. Mastrangelo

 

  (c) Public Warehouses or other Locations Pursuant to Bailment or Consignment
Arrangements (include name of Warehouse Operator or other Bailee or Consignee):

None.

 

  (d) Vendor Managed Locations Under the Control of the Grantor:

None.

 

VIII. Prior Names: During the five years prior to the First Amendment Effective
Date, the Grantor has not been known by or used any other corporate or
fictitious name, except:

JanPak, Inc.

 

IX. Prior Mergers or Other Acquisitions: In the five years preceding the First
Amendment Effective Date, the Grantor has not been a party to any merger or
consolidation or been a party to any acquisition (other than the Merger),
except:

 

Borrower / Subsidiary

  

Name of Entity

  

Action

  

Date of
Action

  

Jurisdiction of Formation

JanPak, LLC    M & P Industries, Inc.    Asset acquisition    08/18/2008    WV
JanPak, LLC    Alternative Packaging Source Inc.    Asset acquisition   
10/01/2009    FL JanPak, LLC    Royal Supply Co. Inc.    Asset acquisition   
07/01/2010    WV JanPak, LLC    Melillo Distributing Company, Inc.    Asset
acquisition    11/01/2010    FL JanPak, LLC    SSS Distribution, L.L.C.    Asset
acquisition    04/21/2011    TX JanPak, LLC    Advance Paper Company    Asset
acquisition    04/01/2012    TN JanPak, LLC    ABM Janitorial Services, Inc. and
Southern Management ABM, LLC    Asset acquisition    09/30/2012    DE         
  

 

14

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INFORMATION AND COLLATERAL LOCATIONS OF JANPAK OF TEXAS, LLC

 

I. Name of Grantor: JanPak of Texas, LLC

 

II State of Incorporation or Organization: Texas

 

III. Type of Entity: Limited liability company

 

IV. Organizational Number assigned by State of Incorporation or Organization:
801904758

 

V. Federal Identification Number:

 

VI, Place of Business (if it has only one) or Chief Executive Office (if more
than one place of business) and Mailing Address:

Chief Executive Office and Mailing Address

701 San Marco Boulevard

Jacksonville, FL 32207 U.S.A.

Attention: Treasurer

 

VII. Locations of Collateral:

 

  (a) Properties Owned by the Grantor:

None.

 

  (b) Properties Leased by the Grantor (Include Landlord’s Name):

 

Loan Party

  

Address

  

City

  

State

  

Zip Code

  

Landlord / Owner if Leased

JanPak of Texas, LLC    3101 High River Road, Suite 101    Fort Worth    TX   
76155    CPF River Park LLC

 

  (c) Public Warehouses or other Locations Pursuant to Bailment or Consignment
Arrangements (include name of Warehouse Operator or other Bailee or Consignee):

1. Murphy Bonded Warehouse, 2391 Levy Street, Shreveport, LA 71103

 

  (d) Vendor Managed Locations Under the Control of the Grantor:

None.

 

VIII. Prior Names: During the five years prior to the First Amendment Effective
Date, the Grantor has not been known by or used any other corporate or
fictitious name, except:

JanPak of Texas, Inc.

 

IX. Prior Mergers or Other Acquisitions: In the five years preceding the First
Amendment Effective Date, the Grantor has not been a party to any merger or
consolidation or been a party to any acquisition except:

None.

 

15

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INFORMATION AND COLLATERAL LOCATIONS OF JANPAK OF SOUTH CAROLINA, LLC

 

I. Name of Grantor: JanPak of South Carolina, LLC

 

II. State of Incorporation or Organization: South Carolina

 

III. Type of Entity: Limited liability company

 

IV. Organizational Number assigned by State of Incorporation or Organization:
None.

 

V. Federal Identification Number:

 

VI. Place of Business (if it has only one) or Chief Executive Office (if more
than one place of business) and Mailing Address:

Chief Executive Office and Mailing Address

701 San Marco Boulevard

Jacksonville, FL 32207 U.S.A.

Attention: Treasurer

 

VII. Locations of Collateral:

 

  (a) Properties Owned by the Grantor:

 

  1. 134 Leader Drive, Greenville, SC 29602 (5.18 acres of property with one
building measuring approx. 84,419 sq. ft.)

 

  (b) Properties Leased by the Grantor (Include Landlord’s Name)

None.

 

  (c) Public Warehouses or other Locations pursuant to Bailment or Consignment
Arrangements (include name of Warehouse Operator or other Bailee or Consignee):

None.

 

  (d) Vendor Managed Locations Under the Control of the Grantor:

None.

 

VIII. Prior Names: During the five years prior to the First Amendment Effective
Date, the Grantor has not been known by or used any other corporate or
fictitious name, except:

JanPak of South Carolina, Inc.

 

IX. Prior Mergers or Other Acquisitions: In the five years preceding the First
Amendment Effective Date, the Grantor has not been a party to any merger or
consolidation or been a party to any acquisition except:

None.

 

16

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INFORMATION AND COLLATERAL LOCATIONS OF ZIP TECHNOLOGY, LLC

 

I. Name of Grantor: Zip Technology, LLC

 

II. State of Incorporation or Organization: West Virginia

 

III. Type of Entity: Limited liability company

 

IV. Organizational Number assigned by State of Incorporation or Organization:
None.

 

V. Federal Identification Number:

 

VI. Place of Business (if it has only one) or Chief Executive Office (if more
than one place of business) and Mailing Address:

Chief Executive Office and Mailing Address

701 San Marco Boulevard

Jacksonville, FL 32207 U.S.A.

Attention: Treasurer

 

VII. Locations of Collateral:

 

  (a) Properties Owned by the Grantor:

None.

 

  (b) Properties Leased by the Grantor (Include Landlord’s Name):

None.

 

  (c) Public Warehouses or other Locations pursuant to Bailment or Consignment
Arrangements (include name of Warehouse Operator or other Bailee or Consignee):

None.

 

  (d) Vendor Managed Locations Under the Control of the Grantor:

None.

 

VIII. Prior Names: During the five years prior to the First Amendment Effective
Date, the Grantor has not been known by or used any other corporate or
fictitious name, except:

ZIP Technology, Inc.

 

IX. Prior Mergers or Other Acquisitions: In the five years preceding the First
Amendment Effective Date, the Grantor has not been a party to any merger or
consolidation or been a party to any acquisition except:

None.

 

17

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

EXHIBIT B

(See Sections 3.1, 3.5 and 7.1 of Security Agreement)

DEPOSIT ACCOUNTS, SECURITIES ACCOUNTS, COMMODITIES ACCOUNTS

 

18

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

EXHIBIT B-1

DEPOSIT ACCOUNTS

 

* Indicates Collateral Deposit Account.

 

ENTITY

  

ACCOUNT
DESCRIPTION

  

BANK

  

ACCOUNT #

  

ADDRESS

  

TELEPHONE

IBI Merchandising Services, Inc. (DE)    IBI MerchCo.    Bank of America      
P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands,
Inc. (NJ)    MIdAtlantic RRC*    Wells Fargo       PO Box 63020 San Francisco,
CA 94163    1-800-289-3557 Interline Brands, Inc. (NJ)    Investment Account   
Oppenheimer       18 Columbia Turnpike, Florham Park, NJ 07932    1-800-620-6726
Interline Brands, Inc. (NJ)    IBI-REPO    JP. Morgan Chase       383 Madison
Avenue, New York, New York 10179    1-212-270-6000 Interline Brands, Inc. (NJ)
   DACA Account    JP. Morgan Chase       PO BOX 659754, San Antonio, TX 78265
   1-800-242-7338 Interline Brands, Inc. (NJ)    365 USL – California*    Wells
Fargo       PO Box 6995 Portland, OR 97228-6995    1-800-225-5935 Interline
Brands, Inc. (NJ)    Barnett Merchant Deposits*    Bank of America       P.O.
Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc.
(NJ)    US Lock Merchant Deposit*    Bank of America       P.O. Box 25118 Tampa,
Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    LeRan
Merchant Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida
33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    JDE PAYABLES    Bank
of America       P.O. Box 4899 Atlanta, GA 30302-4899    1-888-400-9009
Interline Brands, Inc. (NJ)    JACKSONVILLE-Pre-encoded*    Bank of America   
   P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands,
Inc. (NJ)    MAIN OPERATING A/C*    Bank of America       P.O. Box 25118 Tampa,
Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    Barnett
Lockbox*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118   
1-888-400-9009 Interline Brands, Inc. (NJ)    LOCKBOX-WILMAR*    Bank of America
      P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline
Brands, Inc. (NJ)    US Lock Lockbox*    Bank of America       P.O. Box 25118
Tampa, Florida 33622-5118    1-888-400-9009

 

19

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

ENTITY

  

ACCOUNT
DESCRIPTION

  

BANK

  

ACCOUNT #

  

ADDRESS

  

TELEPHONE

Interline Brands, Inc. (NJ)    Payroll    Bank of America       P.O. Box 25118
Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    IBI
Corporate Receipts    Bank of America       P.O. Box 25118 Tampa, Florida
33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    Interline Brands
#123 Wilmar*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118
   1-888-400-9009 Interline Brands, Inc. (NJ)    LOCAL 190*    Bank of America
      P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline
Brands, Inc. (NJ)    AmSan Merchant Deposit*    Bank of America       P.O. Box
25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)   
Copperfield Merchant Deposits*    Bank of America       P.O. Box 25118 Tampa,
Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    MUSA
Merchant Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida
33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    Wilmar Merchant
Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118   
1-888-400-9009 Interline Brands, Inc. (NJ)    AmSanLockbox Receipts*    Bank of
America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009
Interline Brands, Inc. (NJ)    NCP Operating    Bank of America       P.O. Box
25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)   
CleanSource Collections*    Bank of America       P.O. Box 25118 Tampa, Florida
33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    NCP Disbursements   
Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009
Interline Brands, Inc. (NJ)    NCP Collections*    Bank of America       P.O.
Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc.
(NJ)    MAIN OPERATING A/C    Bank of America       P.O. Box 25118 Tampa,
Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    Cash    Bank
of America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009
Interline Brands, Inc. (NJ)    CleanSource Disbursement    Bank of America      
P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands,
Inc. (NJ)    Trayco Merchant Deposits*    Bank of America       P.O. Box 25118
Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)   
Sexauer Merchant Deposits*    Bank of America       P.O. Box 25118 Tampa,
Florida 33622-5118    1-888-400-9009

 

20

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

ENTITY

  

ACCOUNT
DESCRIPTION

  

BANK

  

ACCOUNT #

  

ADDRESS

  

TELEPHONE

Interline Brands, Inc. (NJ)    SunStar Merchant Deposits*    Bank of America   
   P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands,
Inc. (NJ)    AF Lighting Merchant Deposits*    Bank of America       P.O. Box
25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)   
JDE ACH*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118   
1-888-400-9009 Interline Brands, Inc. (NJ)    Pyramid Operating    Bank of
America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009
Interline Brands, Inc. (NJ)    Homeparts    Bank of America       P.O. Box 25118
Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    MRO
Local Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida
33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    JanSan Local
Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118   
1-888-400-9009 Interline Brands, Inc. (NJ)    AmSan Herrin #471*    Bank of
America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009
Interline Brands, Inc. (NJ)    Thailand Rep Office    Bangkok Bank       333
Silom Road Bangkok 10500, Thailand    +66-0-2645-5555 Interline Brands, Inc.
(NJ)    Thailand Rep Office    Bangkok Bank       333 Silom Road Bangkok 10500,
Thailand    +66-0-2645-5555 Interline Brands, Inc. (NJ)    Peoria*    Busey Bank
      PO Box 4028 Champaign IL 61824    1-800-672-8739 Interline Brands, Inc.
(NJ)    NEW ORLEANS*    Capital One       3939 W John Carpenter Way, Irving, TX
75063    (888)755-2172 Interline Brands, Inc. (NJ)    Paris*    Capital One   
   3939 W John Carpenter Way, Irving, TX 75063    (888)755-2172 Interline
Brands, Inc. (NJ)    New Orleans*    Capital One       3939 W John Carpenter
Way, Irving, TX 75063    (888)755-2172 Interline Brands, Inc. (NJ)    DALLAS*   
CHASE       PO Box 659754 San Antonio, TX 78265-9754    1-800-242-7338 Interline
Brands, Inc. (NJ)    SAM IRVINS*    Frost National       PO BOX 16509, Fort
Worth, TX 76162    1-800-513-7678 Interline Brands, Inc. (NJ)    CINCINNATI*   
Huntington       PO Box 1558 EA1W37 Columbus OH 43216-1558    1-800-480-2001
Interline Brands, Inc. (NJ)    Cleveland*    Key Bank       800 Superior Ave,
Cleveland, OH 44114    1-800-539-2968 Interline Brands, Inc. (NJ)    Iowa*   
Libertyville Savings Bank       PO Box 744 Fairfield, Iowa 52556   
1-877-886-1600

 

21

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

ENTITY

  

ACCOUNT
DESCRIPTION

  

BANK

  

ACCOUNT #

  

ADDRESS

  

TELEPHONE

Interline Brands, Inc. (NJ)    LOUISVILLE*    PNC BANK       PO Box 609
Pittsburgh, PA 15230-9738    1-877-287-2654 Interline Brands, Inc. (NJ)   
PITTSBURGH PU*    PNC BANK       PO Box 609 Pittsburgh, PA 15230-9738   
1-877-287-2654 Interline Brands, Inc. (NJ)    USL KENTUCKY*    PNC BANK       PO
Box 609 Pittsburgh, PA 15230-9738    1-877-287-2654 Interline Brands, Inc. (NJ)
   NATIONAL CITY-LVL REG- SX*    PNC BANK       PO Box 609 Pittsburgh, PA
15230-9738    1-877-287-2654 Interline Brands, Inc. (NJ)    BIRMINGHAM*   
Regions Bank       8758 East 96th Street Fishers, IN 46038    1-800-734-4667
Interline Brands, Inc. (NJ)    INDIANAPOLIS*    Regions Bank       8758 East
96th Street Fishers, IN 46038    1-800-734-4667 Interline Brands, Inc. (NJ)   
Atlanta*    Regions Bank       8758 East 96th Street Fishers, IN 46038   
1-800-734-4667 Interline Brands, Inc. (NJ)    ST LOUIS*    St. Johns       PO
BOX 149014, St Louis, MI 63114    1-314-423-2265 Interline Brands, Inc. (NJ)   
Denver/ Denver South*    US Bank       PO Box 1800 Saint Paul, Minnesota
55101-0800    1-800-377-3053 Interline Brands, Inc. (NJ)    Denver/ Denver
South*    US Bank       PO Box 1800 Saint Paul, Minnesota 55101-0800   
1-800-377-3053 Interline Brands, Inc. (NJ)    Denver/ Denver South*    US Bank
      PO Box 1800 Saint Paul, Minnesota 55101-0800    1-800-377-3053 Interline
Brands, Inc. (NJ)    NDC West*    US Bank       PO Box 1800 Saint Paul,
Minnesota 55101-0800    1-800-377-3053 Interline Brands, Inc. (NJ)    NDC East*
   US Bank       PO Box 1800 Saint Paul, Minnesota 55101-0800    1-800-377-3053
Interline Brands, Inc. (NJ)    COLUMBUS*    US Bank       PO Box 1800 Saint
Paul, Minnesota 55101-0800    1-800-377-3053 Interline Brands, Inc. (NJ)   
Minn/ St Paul*    US Bank       PO Box 1800 Saint Paul, Minnesota 55101-0800   
1-800-377-3053 Interline Brands, Inc. (NJ)    Davenport*    US Bank       PO Box
1800 Saint Paul, Minnesota 55101-0800    1-800-377-3053 Interline Brands, Inc.
(NJ)    St Paul*    US Bank       PO Box 1800 Saint Paul, Minnesota 55101-0800
   1-800-377-3053 Interline Brands, Inc. (NJ)    Omaha*    US Bank       PO Box
1800 Saint Paul, Minnesota 55101-0800    1-800-377-3053

 

22

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

ENTITY

  

ACCOUNT
DESCRIPTION

  

BANK

  

ACCOUNT #

  

ADDRESS

  

TELEPHONE

Interline Brands, Inc. (NJ)    St. Paul / MN*    US Bank       PO Box 1800 Saint
Paul, Minnesota 55101-0800    1-800-377-3053 Interline Brands, Inc. (NJ)   
Columbus*    US Bank       PO Box 1800 Saint Paul, Minnesota 55101-0800   
1-800-377-3053 Interline Brands, Inc. (NJ)    NDC West*    US Bank       PO Box
1800 Saint Paul, Minnesota 55101-0800    1-800-377-3053 Interline Brands, Inc.
(NJ)    Pueblo*    US Bank       PO Box 1800 Saint Paul, Minnesota 55101-0800   
1-800-377-3053 Interline Brands, Inc. (NJ)    Greeley*    US Bank       PO Box
1800 Saint Paul, Minnesota 55101-0800    1-800-377-3053 Interline Brands, Inc.
(NJ)    Greeley 4th*    US Bank       PO Box 1800 Saint Paul, Minnesota
55101-0800    1-800-377-3053 Interline Brands, Inc. (NJ)    JanSan Deposits*   
US Bank       PO Box 1800 Saint Paul, Minnesota 55101-0800    1-800-377-3053
Interline Brands, Inc. (NJ)    MRO Deposits*    US Bank       PO Box 1800 Saint
Paul, Minnesota 55101-0800    1-800-377-3053 JanPak, LLC    JanPak CDA Account
   Bank of America       P.O. Box 4899 Atlanta, GA 30302-4899    1-888-400-9009
JanPak, LLC    JanPak Operating    Bank of America       P.O. Box 25118 Tampa,
Florida 33622-5118    1-888-400-9009 JanPak, LLC    JanPak Payroll Disbursement
   Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118   
1-888-400-9009 JanPak, LLC    JanPak Deposits*    Bank of America       P.O. Box
25118 Tampa, Florida 33622-5118    1-888-400-9009 JanPak, LLC    JanPak AP
Disbursements    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118
   1-888-400-9009 JanPak, LLC    JanPak Merchant Deposits*    Bank of America   
   P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 JanPak, LLC   
Cash Collateral Account    Wells Fargo       401 South Tryon Charlotte, NC 28288
   1-612-673-8635 JanPak, LLC    Operating / AP Account    Wells Fargo       401
South Tryon Charlotte, NC 28288    1-612-673-8635 JanPak, LLC    Merchant
Account*    Wells Fargo       401 South Tryon Charlotte, NC 28288   
1-612-673-8635 JanPak, LLC    A/P Account    Wells Fargo       401 South Tryon
Charlotte, NC 28288    1-612-673-8635

 

23

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

ENTITY

  

ACCOUNT
DESCRIPTION

  

BANK

  

ACCOUNT #

  

ADDRESS

  

TELEPHONE

JanPak, LLC    Payroll Account    Wells Fargo       401 South Tryon Charlotte,
NC 28288    1-612-673-8635 JanPak, LLC    Field Support*    First Century,
Bluefield WV       500 Federal St, Bluefield WV 24701    1-304-325-8181 JanPak,
LLC    Bluefield DC*    First Century, Bluefield WV       500 Federal St,
Bluefield WV 24701    1-304-325-8181 JanPak, LLC    Deposit Account*    First
Sentry Bank, Huntington WV       823 8th St, Huntington WV 25721   
1-304-522-6400 JanPak, LLC    Deposit Account*    AmSouth (now
Regions), Huntsville, AL       1031 Winchester Rd NE Huntsville AL 35811   
1-334-501-0293 Wilmar Financial, Inc.    Wilmar Financial, Inc. Money Market   
US Bank       300 Delaware Avenue, Wilmington, DE 19801    1-302-576-3712 Wilmar
Financial, Inc.    Wilmar Financial, Inc. Depository    Wells Fargo       PO Box
63020 San Francisco, CA 94163    1-800-289-3557 Zip Technology, LLC    Deposit
Account    First Century, Bluefield WV       500 Federal St, Bluefield WV 24701
   1-304-325-8181 Diversified Chemicals and Supply, Inc.2    Diversified Account
   Wells Fargo       401 South Tryon Charlotte, NC 28288    1-612-673-8635

EXHIBIT B-II

 

ENTITY

  

ACCOUNT
DESCRIPTION

  

BANK

  

ACCOUNT #

  

ADDRESS

  

TELEPHONE

Interline Brands, Inc. (NJ)    MIdAtlantic RRC*    Wells Fargo       PO Box
63020 San Francisco, CA 94163    1-800-289-3557 Interline Brands, Inc. (NJ)   
365 USL – California*    Wells Fargo       PO Box 6995 Portland, OR 97228-6995
   1-800-225-5935 Interline Brands, Inc. (NJ)    Barnett Merchant Deposits*   
Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009
Interline Brands, Inc. (NJ)    US Lock Merchant Deposit*    Bank of America   
   P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009

 

2  This account is used as a deposit account pursuant to an Exclusive Supplier
Agreement between Diversified Chemicals and Supply, Inc. and JanPak of Texas,
Inc. dated September 17, 2012.

 

24

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

ENTITY

  

ACCOUNT
DESCRIPTION

  

BANK

  

ACCOUNT #

  

ADDRESS

  

TELEPHONE

Interline Brands, Inc. (NJ)    LeRan Merchant Deposits*    Bank of America      
P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands,
Inc. (NJ)    JACKSONVILLE-Pre-encoded*    Bank of America       P.O. Box 25118
Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    MAIN
OPERATING A/C*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118
   1-888-400-9009 Interline Brands, Inc. (NJ)    Barnett Lockbox*    Bank of
America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009
Interline Brands, Inc. (NJ)    LOCKBOX-WILMAR*    Bank of America       P.O. Box
25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)   
US Lock Lockbox*    Bank of America       P.O. Box 25118 Tampa, Florida
33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    Interline Brands
#123 Wilmar*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118
   1-888-400-9009 Interline Brands, Inc. (NJ)    LOCAL 190*    Bank of America
      P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline
Brands, Inc. (NJ)    AmSan Merchant Deposit*    Bank of America       P.O. Box
25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)   
Copperfield Merchant Deposits*    Bank of America       P.O. Box 25118 Tampa,
Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    MUSA
Merchant Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida
33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    Wilmar Merchant
Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118   
1-888-400-9009 Interline Brands, Inc. (NJ)    AmSanLockbox Receipts*    Bank of
America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009
Interline Brands, Inc. (NJ)    CleanSource Collections*    Bank of America      
P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline Brands,
Inc. (NJ)    NCP Collections*    Bank of America       P.O. Box 25118 Tampa,
Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    Trayco
Merchant Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida
33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    Sexauer Merchant
Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118   
1-888-400-9009 Interline Brands, Inc. (NJ)    SunStar Merchant Deposits*    Bank
of America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009

 

25

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

ENTITY

  

ACCOUNT
DESCRIPTION

  

BANK

  

ACCOUNT #

  

ADDRESS

  

TELEPHONE

Interline Brands, Inc. (NJ)    AF Lighting Merchant Deposits*    Bank of America
      P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 Interline
Brands, Inc. (NJ)    JDE ACH*    Bank of America       P.O. Box 25118 Tampa,
Florida 33622-5118    1-888-400-9009 Interline Brands, Inc. (NJ)    MRO Local
Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118   
1-888-400-9009 Interline Brands, Inc. (NJ)    JanSan Local Deposits*    Bank of
America       P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009
Interline Brands, Inc. (NJ)    AmSan Herrin #471*    Bank of America       P.O.
Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 JanPak, LLC    JanPak
Deposits*    Bank of America       P.O. Box 25118 Tampa, Florida 33622-5118   
1-888-400-9009 JanPak, LLC    JanPak Merchant Deposits*    Bank of America      
P.O. Box 25118 Tampa, Florida 33622-5118    1-888-400-9009 JanPak, LLC   
Merchant Account*    Wells Fargo       401 South Tryon Charlotte, NC 28288   
1-612-673-8635 JanPak, LLC    Field Support*    First Century, Bluefield WV   
   500 Federal St, Bluefield WV 24701    1-304-325-8181 JanPak, LLC    Bluefield
DC*    First Century, Bluefield WV       500 Federal St, Bluefield WV 24701   
1-304-325-8181 JanPak, LLC    Deposit Account*    First Sentry Bank, Huntington
WV       823 8th St, Huntington WV 25721    1-304-522-6400 JanPak, LLC   
Deposit Account*    AmSouth (now Regions), Huntsville, AL       1031 Winchester
Rd NE Huntsville AL 35811    1-334-501-0293

SECURITIES ACCOUNTS

None.

COMMIDITY ACCOUNTS

None.

 

26

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

EXHIBIT C

(See Section 3.7 of Security Agreement)

LETTER OF CREDIT RIGHTS

i) Standby Letters of Credit

None.

ii) Commercial Letters of Credit

None.

CHATTEL PAPER

None.

 

27

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

EXHIBIT D

(Sec Sections 3.10 and 3.11 of Security Agreement)

Patents and Patent Applications

 

Title

  

Patent No.

  

Issue Date

  

Record Owner

  

Status

Chimney Cover    6,152,817    11/28/2000    Interline Brands, Inc.    Issued
Chimney Damper With Locking Mechanism    5,556,329    09/17/1996    Interline
Brands, Inc.    Issued Light Switch Device    D457,145    05/14/2002   
Interline Brands, Inc.    Issued Liner Adaptor for Chimney    CA2455364   
10/06/2009    Interline Brands, Inc.    Issued Liner Adaptor for Chimneys   
6,852,023    02/08/2005    Interline Brands, Inc.    Issued Pivoting Recessed
Light Fixture    8,444,302    05/21/2013    Interline Brands, Inc.    Issued Top
Sealing Chimney Cap    5,437,574    08/01/1995    Interline Brands, Inc.   
Issued Universal Chimney Cap    6,918,827    07/19/2005    Interline Brands,
Inc.    Issued

Copyrights and Copyright Applications

 

Title

  

Registration Number

Ace Maintenance Mart    TX-4-153-802 One Source Supply, Inc.    TX-2-761-878 One
Source Supply, Inc.    TX-3-090-373 One Source Supply, Inc.    TX-3-265-612 One
Source Supply, Inc.    TX-3-824-524 One Source Supply, Inc.    TX-4-075-516 The
Supply Depot, Inc., catalog ‘95    TX-4-061-009 The Supply Depot, Inc.   
TX-2-293-655 The Supply Depot, Inc., Catalog, volume 1    TX-5-136-514 The
Supply Depot, Inc.    TX-2-744-527 The Supply Depot, Inc.   

TX-3-563-041

TX-3-563-040

Wilmar quality maintenance products master catalog : vol. 7.    TX-3-734-942
Wilmar quality maintenance products : vol. 10P.    TX-4-777-852 Wihnar master
catalog : vol. 12P.    TX-4-777-853 Wilmar master catalog : vol. 9P.   
TX-4-777-854 Wilmar quality maintenance products : vol. 11P.    TX-4-777-855

 

28

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

Title

  

Registration Number

Wilmar, the big book : vol. 13.    TX-4-777-856 Willmar multi-housing & lodging
catalog.    TX-4-777-881 Wilmar buying guide : vol. 6.    TX-4-777-882 Wilmar
Catalog, vol. 14    TX-5-136-540 Trayco, Inc., tools, cleaners, compounds, and
fasteners: catalog section E    TX-2-464-014 Residential faucet & valve
repairyarts : catalog section B    TX-2-464-713 Trayco, Inc., catalog section F.
   TX-2-467-505 Trayco, Inc., commercial and institutional faucet & valve repair
parts : OEM parts and quality Trayco replacements: catalog section C.   
TX-2-469-423 Trayco, Inc.: flushometers and repair parts : catalog section G.   
TX-2-478-400 Trayco, Inc., waste & supply products : catalog section D.   
TX-2-596-036 Plumbing & heating specialties.    TX-2-664-040 Trayco, Inc.,
heating repair products catalog section K.    TX-2-779-067 Master Catalog   
TX-3-524-I55 The Sexauer system of standardized repair service. By Harold
Frederick Springhorn.    RE-347-421 Catalog, By J.A. Sexauer Manufacturing Co.,
Inc.    RE-586-821 Stem catalogue. By J.A. Sexauer Manufacturing Co., Inc.   
RE-652-972 K-70 price list. By J.A. Sexauer Manufacturing Co., Inc.   
RE-782-951 Supplement to Sexauer catalog edition “K.” By J.A. Sexauer
Manufacturing Co., Inc.    RE-782-952 1971 price List-50th anniversary. By J.A.
Sexauer Manufacturing Co., Inc.    RE-792-254 50th anniversary    RE-804-125
Sexauer master catalog, 1997.    PA-907-451 Plumbing & heating repair parts:
catalog section 1: general maintenance.    TX-191-680 Tools, kits & chemicals :
catalog section 2.    TX-192-815 Kitchen & utility sink repairs: catalog section
5.    TX-194-393 Toilet & tank repairs : catalog section 7.    TX-194-394
Lavatory repairs : catalog section 4.    TX-194-413 Commercial & institutional
repairs : catalog section 3.    TX-194-580 Tub & shower repairs : catalog
section 6.    TX-194-836 Take a look at what’s new from Sexauer]: Supplement to
Master catalog/ 1st edition.    TX-348-827 Master catalog.    TX-589-452 Master
catalog.    TX-792-694 Stem handbook: faucet stems, cartridges & bonnet
assemblies    TX-1-206-527 Electrical maintenance products : catalog section 9.
   TX-1-684-509 Stem handbook : faucet stems, cartridges & bonnet assemblies:
catalog section 10.    TX-1-686-817 Electrical maintenance products : catalog
section 9.    TX-2-398-521 Master catalog / J.A. Sexauer    TX-2-584-387

 

29

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

Title

  

Registration Number

Master catalog / J.A. Sexauer    TX-3-021-301 Master catalog    TX-3-518-677
Heating and air conditioning repair and maintenance products: catalog section
11.    TX-3-581-973 Faucet stems, handles, and bibb seats : catalog section 10.
   TX-3-606-319 Faucet stems, handles, and bibb seats : catalog section 10.   
TX-4-178-061 Electrical maintenance products : catalog section 9, rev. July,
1995.    TX-4-242-472 Home products.    TX-4-250-716 Maintenance Choice   
TX-4-422-964 Maintenance choice    TX-4-691-586 Maintenance choice.   
TX-4-901-157 Sexauer    TX-1-206-528 Sexauer    TX-1-688-620 Sexauer   
TX-4-115-636 Sexauer    TX-4-619-198 Stem handbook    TX-2-022-382 Stem handbook
   TX-2-394-386 Value Plus    TX-2-385-475 Value Plus   

TX-2-532-178

Prev. reg. 1988,

Electrical maintenance products    TX-3-049-488 Electrical maintenance products
   TX-3-254-289 Electrical maintenance products    TX-3-709-457 Heating and air
conditioning repair and maintenance products.    TX-3-051-570 Barnett Brass &
Copper, net price catalog K-179J, 1979.    TX-306750 Barnett Brass & Copper, net
price catalog K-479J, 1979.    TX-306749 Barnett Brass & Copper, net price
catalog K-779J, 1979.    TX-306748 Barnett, the contractor’s choice: 1958-1998.
   TX-4790268 Barnett, plumbing, electrical, hardware: Jan., Feb., Mar., 1995   
TX-4064429 Catalog Section 11    TX-1684489 Catalog Section 9    TX-1855090
Heating & A/C Repair & Maintenance Products Catalog Section 11    TX-3266913
Heating & Air Conditioning Repair & Maintenance Products    TX-2037172 Master
Catalog 1999    TX-5032652 Master Catalog Sixth Edition    TX-2084000 Stem
Handbook    TX-1848095 The Supply Depot: Repair and Maintenance Products for
Apartment Buildings - Vol. 1    TX-5136514 Trayco Inc. Catalog Section G   
TX-2478400

 

30

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

Title

  

Registration Number

Trayco Logo    TX-1954062 Value Plus Catalog Sec. 12    TX-3261768 k-70 price
list    A250998 Supplement to Sexauer catalog edition “K”    A250999 Stem
catalog    A311767 50th Anniversary    A437485, A437676 Catalog K    A687909
Sexauer Stem catalog for master plumbers and maintenance mechanics    A756033
Supplement to third edition catalog “P”    A875698 Sexauer plumbing products   
R320523 Supplementary catalog of new products added to the famous quality
Sexauer line    RE870259 Supplementary catalog price list    RE870258 Price list
April 30, 1974    RE870260 Catalog    RE870261 Electrical maintenance products
   TX2027996 Catalog Special Edition    A579-349 Industry, Intensity,
Integrity & Intelligence (3rd Edition Catalog P)    A 894353 Mule-Kick   
15713/R313192 Mule-Kick    40304/R226770 Plumbing and Heating Supplies    RE
2-879 / AA 160070 Price List April 30, 1974    A 579348 Price List Edition P   
A 705092 Price List Edition P    A 875699 Quality Plumbing and Heating
Specialties    RE 353-291 / A402577 Sexauer Plumbing Products    15903 / R320523
Sexauer Products Edition P (Catalog)    A 670029 Sexauer Stem Catalog for Master
Plumbers and Maintenance Mechanics    A 756033 Sexauer System of Standardized
Repair Service    A 279905 Supplement to Third Edition Catalog P    A 875698
Supplemental Catalog of New Product Added to Quality Sexauer Line    AA 519333
Supplementary Catalog Price List    AA 522439 Copperfield Chimney Supply, Inc.:
wholesale catalog    TX-4-700-197 Copperfield Chimney Supply, Inc., 1999-2000
faIl/winter catalog    TX-5-384-447 Copperfield Chimney Supply, Inc., 2000-2001
wholesale catalog    TX-5-384-448 Copperfield Chimney Supply, Inc., 2001-2002
wholesale catalog    TX-5-384-449 Copperfield Chimney Supply, Inc., 1998-1999
wholesale catalog    TX-5-384-450 Sexauer 1999, main catalog    TX-5-121-967

 

31

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

Title

  

Registration Number

Maintenance Choice    TX-5-129-965 Maintenance Choice    TX-5-389-157
Maintenance Choice    TX-5-287-086 Master Catalog 3rd Edition    CA 412-503
Master Catalog 1999    CA 478-853 Master Catalog    CA 389-032 Sexauer Products;
price list    RE 880-192 Sexauer Product Edition P (Catalog)    RE 880-193

Trademarks and Trademark Applications

 

Mark

  

Jurisdiction

  

Reg. No.

(serial no.)

  

Registered

(Filed)

  

Owner

  

Status - Liens

LOGO [g695748ex10_4pg63a.jpg]    Canada    1,363,815    02/10/2012    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg63b.jpg]    Canada   

0545553/

TMA322,379

   01/02/1987    Interline Brands, Inc.    Registered GELCO    Canada   

1,239,026/

TMA667,438

   07/12/2006   

Interline Brands, Inc.,

Fairfield, Iowa

   Registered LIQUI-ZYME    Canada   

0857706/

TMA533,706

   09/28/2000    J.A. Sexauer, Inc.    Registered LOCK-TOP    Canada   

1,239,028/

TMA662,676

   04/18/2006   

Interline Brands, Inc.,

Fairfield, Iowa

   Registered LYEMANCE    Canada   

1,239,027/

TMA669,037

   07/31/2006   

Interline Brands, Inc.,

Fairfield, Iowa

   Registered MAINTENANCE CHOICE    Canada   

0823441/

TMA517,696

   10/08/1999    J.A. Sexauer, Inc.    Registered MULE KICK    Canada   

0765010/

TMA446,798

   08/25/1995    J.A. Sexauer, Inc.    Registered PREMIERPLUS    Canada   
1488959    07/16/2010    Interline Brands, Inc.    Pending QUICK-PICK    Canada
  

0758134/

TMA473,783

   03/26/1997    J.A. Sexauer, Inc.    Registered SEXAUER    Canada   

0545552/

TMA316,729

   07/25/1986    J.A. Sexauer, Inc.    Registered VALUE PLUS    Canada   

0562063/

TMA334,336

   11/20/1987    J.A. Sexauer, Inc.    Registered VALUE PLUS logo    Canada   

0562064/

TMA331,694

   09/04/1987    J.A. Sexauer, Inc.    Registered PREMIER (stylized)    China   
6685999    04/28/2008    Interline Brands, Inc.    Pending SEXAUER    Puerto
Rico    18,023    03/08/1973    Interline Brands, Inc.    Registered SEXAUER   
Puerto Rico    18,017    03/08/1973    Interline Brands, Inc.    Registered

 

32

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

Mark

  

Jurisdiction

  

Reg. No.

(serial no.)

  

Registered

(Filed)

  

Owner

  

Status - Liens

SEXAUER    Puerto Rico    17,910    12/06/1972    Interline Brands, Inc.   
Registered SEXAUER    Puerto Rico    18,018    03/08/1973    Interline Brands,
Inc.    Registered LOGO [g695748ex10_4pg64a.jpg]    U.S. Federal    3910668   
01/25/2011    Interline Brands, Inc.    Registered LOGO [g695748ex10_4pg64a.jpg]
   U.S. Federal    3903964    01/11/2011    Interline Brands, Inc.    Registered
LOGO [g695748ex10_4pg64b.jpg]    U.S. Federal    3916874    02/08/2011   
Interline Brands, Inc.    Registered LOGO [g695748ex10_4pg64c.jpg]    U.S.
Federal    3988478    07/05/2011    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg64d.jpg]    U.S. Federal    0558587    05/13/1952    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg64e.jpg]    U.S. Federal   
2369493    07/18/2000    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg64f.jpg]    U.S. Federal    2541649    02/19/2002    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg64f.jpg]    U.S. Federal   
2942331    04/19/2005    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg64g.jpg]    U.S. Federal    3844961    09/07/2010    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg64h.jpg]    U.S. Federal   
3505004    09/23/2008    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg64h.jpg]    U.S. Federal    3504990    09/23/2008    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg64i.jpg]    U.S. Federal   
0439361    06/22/1948    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg64j.jpg]    U.S. Federal    0224528    03/01/1927    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg64k.jpg]    U.S. Federal   
3442774    06/03/2008    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg64l.jpg]    U.S. Federal    3544984    12/09/2008    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg64l.jpg]    U.S. Federal   
3623550    05/19/2009    Interline Brands, Inc.    Registered

 

33

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

Mark

  

Jurisdiction

  

Reg. No.

(serial no.)

  

Registered

(Filed)

  

Owner

  

Status - Liens

LOGO [g695748ex10_4pg65a.jpg]    U.S. Federal    2310694    01/25/2000   
Interline Brands, Inc.    Registered LOGO [g695748ex10_4pg65b.jpg]    U.S.
Federal    1702822    07/28/1992    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg65b.jpg]    U.S. Federal    2323254    02/29/2000    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg65c.jpg]    U.S. Federal   
2317422    02/15/2000    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg65d.jpg]    U.S. Federal    2327939    03/14/2000    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg65e.jpg]    U.S. Federal   
2007761    10/15/1996    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg65f.jpg]    U.S. Federal    0538820    03/06/1951    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg65g.jpg]    U.S. Federal   
0558236    04/29/1952    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg65h.jpg]    U.S. Federal    1134409    05/06/1980    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg65h.jpg]    U.S. Federal   
1135759    05/20/1980    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg65h.jpg]    U.S. Federal    1135402    05/20/1980    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg65h.jpg]    U.S. Federal   
1137747    07/15/1980    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg65h.jpg]    U.S. Federal    1142351    12/09/1980    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg65h.jpg]    U.S. Federal   
1148671    03/24/1981    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg65h.jpg]    U.S. Federal    1185370    01/12/1982    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg65i.jpg]    U.S. Federal   
1183470    12/29/1981    Interline Brands, Inc.    Registered LOGO
[g695748ex10_4pg65j.jpg]    U.S. Federal    0289929    12/15/1931    Interline
Brands, Inc.    Registered LOGO [g695748ex10_4pg65a.jpg]    U.S. Federal   
3985227    06/28/2011    Interline Brands, Inc.    Registered AF LIGHTING   
U.S. Federal    3910664    01/25/2011    Interline Brands, Inc.    Registered

 

34

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

Mark

  

Jurisdiction

  

Reg. No.

(serial no.)

  

Registered

(Filed)

  

Owner

  

Status - Liens

AF LIGHTING    U.S. Federal    3903952    01/11/2011    Interline Brands, Inc.
   Registered ALL FIT    U.S. Federal    4278498    01/22/2013    Interline
Brands, Inc.    Registered ALL FIT    U.S. Federal    4330390    05/07/2013   
Interline Brands, Inc.    Registered ALL FIT    U.S. Federal    4221562   
10/09/2012    Interline Brands, Inc.    Registered ALL FIT    U.S. Federal   
4221596    10/09/2012    Interline Brands, Inc.    Registered AMSAN    U.S.
Federal    2464679    06/26/2001    Interline Brands, Inc.    Registered AMSAN
   U.S. Federal    2565493    04/30/2002    Interline Brands, Inc.    Registered
AMSAN    U.S. Federal    3076262    04/04/2006    Interline Brands, Inc.   
Registered AMSAN    U.S. Federal    3844956    09/07/2010    Interline Brands,
Inc.    Registered AMSAN    U.S. Federal    2942331    04/19/05    Interline
Brands, Inc.    Registered AMSAN E-ACCESS    U.S. Federal    3308414   
10/09/2007    Interline Brands, Inc.    Registered AMSAN IN-SITE    U.S. Federal
   (86049529)    (08/27/2013)    Interline Brands, Inc.    Pending AMSAN IN-SITE
   U.S. Federal    (86049755)    (08/28/2013)    Interline Brands, Inc.   
Pending AMSAN SELECTCARE    U.S. Federal    (86101325)    (10/24/2013)   
Interline Brands, Inc.    Pending AMSAN UNIVERSITY    U.S. Federal    3162068   
10/24/2006    Interline Brands, Inc.    Registered BALA    U.S. Federal   
2308782    01/18/2000    Interline Brands, Inc.    Registered BARNETT    U.S.
Federal    3470979    07/22/2008    Interline Brands, Inc.    Registered BARNETT
   U.S. Federal    3479540    08/05/2008    Interline Brands, Inc.    Registered
BARNETT SELECTCARE    U.S. Federal    (86101348)    10/25/2013    Interline
Brands, Inc.    Pending BIG DUTY DEADBOLT    U.S. Federal    1947684   
01/09/1996    Interline Brands, Inc.    Registered BIG JERRY    U.S. Federal   
0765650    02/25/1964    Interline Brands, Inc.    Registered BLUE SPOT    U.S.
Federal    0958856    05/15/1973    Interline Brands, Inc.    Registered BRIDGE
LIGHTING    U.S. Federal    3480660    08/05/2008    Interline Brands, Inc.   
Registered BULL DOG    U.S. Federal    0959791    05/29/1973    Interline
Brands, Inc.    Registered C2 LABORATORIES    U.S. Federal    2472992   
07/31/2001    Interline Brands, Inc.    Registered CALIBER    U.S. Federal   
4255406    12/04/2012    Interline Brands, Inc.    Registered CASTAWAY    U.S.
Federal    3732623    12/29/2009    Interline Brands, Inc.    Registered CASTOFF
   U.S. Federal    3971266    05/31/2011    Interline Brands, Inc.    Registered
CLEAN SOURCE    U.S. Federal    2282778    10/05/1999    Interline Brands, Inc.
   Registered CLEAN SOURCE    U.S. Federal    2368001    07/18/2000    Interline
Brands, Inc.    Registered CLEAN SOURCE and design    U.S. Federal    2270441   
08/17/1999    Interline Brands, Inc.    Registered CLEANSOURCE    U.S. Federal
   2122234    12/16/1997    Interline Brands, Inc.    Registered CLEANSOURCE
IN-SITE    U.S. Federal    (86067597)    (09/18/2013)    Interline Brands, Inc.
   Pending CLEANSOURCE IN-SITE    U.S. Federal    (86067771)    (09/18/2013)   
Interline Brands, Inc.    Pending COPPERFIELD    U.S. Federal    3980578   
06/21/2011    Interline Brands, Inc.    Registered COPPERFIELD    U.S. Federal
   1583068    02/13/1990    Interline Brands, Inc.    Registered DESIGNER’S
TOUCH    U.S. Federal    (86127906)    (11/25/2013)    Interline Brands, Inc.   
Pending

 

35

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

Mark

  

Jurisdiction

  

Reg. No.

(serial no.)

  

Registered

(Filed)

  

Owner

  

Status - Liens

DISTINCTIVE BY DESIGN    U.S. Federal    (85940932)    05/23/2013    Interline
Brands, Inc.    Pending DISTINCTIVE BY DESIGN    U.S. Federal    4462334   
01/07/2014    Interline Brands, Inc.    Registered DISTINCTIVE BY DESIGN
(intent-to-use)    U.S. Federal    (85943220)    (05/28/2013)    Interline
Brands, Inc.    Pending DISTINCTIVE BY DESIGN    U.S. Federal    (85943413)   
(05/28/2013)    Interline Brands, Inc.    Pending DISTINCTIVE BY DESIGN    U.S.
Federal    (85941065)    (05/23/2013    Interline Brands, Inc.    Pending EAGLE
MAINTENANCE SUPPLY    U.S. Federal    3,643,089    06/23/2009    Interline
Brands, Inc.    Registered EASY-TITE    U.S. Federal    0891583    05/26/1970   
Interline Brands, Inc.    Registered EASY-WRAP    U.S. Federal    1048507   
09/21/1976    Interline Brands, Inc.    Registered ECOSOURCE    U.S. Federal   
4222099    10/09/2012    Interline Brands, Inc.    Registered ENDURANCE 2000   
U.S. Federal    3442742    06/03/2008    Interline Brands, Inc.    Registered
GARRISON    U.S. Federal    3544986    12/09/2008    Interline Brands, Inc.   
Registered GARRISON    U.S. Federal    3623499    05/19/2009    Interline
Brands, Inc.    Registered GELCO    U.S. Federal    2984849    08/16/2005   
Interline Brands, Inc.    Registered GET IT ALL WITH ONE CALL    U.S. Federal   
2228253    03/02/1999    Interline Brands, Inc.    Registered GSI    U.S.
Federal    1768359    05/04/1993    Interline Brands, Inc.    Registered HANDY
ANDY    U.S. Federal    0288175    10/20/1931    Interline Brands, Inc.   
Registered HARDWARE EXPRESS    U.S. Federal    3985213    06/28/2011   
Interline Brands, Inc.    Registered HOMESAVER    U.S. Federal    1740848   
12/22/1992    Interline Brands, Inc.    Registered HOMESAVER    U.S. Federal   
2328111    03/14/2000    Interline Brands, Inc.    Registered HORSEPOWER    U.S.
Federal    3859155    10/12/2010    Interline Brands, Inc.    Registered IMPROVE
MORE. EFFORT LESS    U.S. Federal    (85836719)    (01/30/2013)    Interline
Brands, Inc.    Pending IMPROVE MORE. EFFORT LESS    U.S. Federal    (85980983)
   (01/30/2013)    Interline Brands, Inc.    Pending INTERLINE    U.S. Federal
   2759591    09/02/2003    Interline Brands, Inc.    Registered INTERLINE
BRANDS    U.S. Federal    3448685    06/17/2008    Interline Brands, Inc.   
Registered INTERLINE INSTITUTIONAL    U.S. Federal    (86101720)    (10/25/2013)
   Interline Brands, Inc.    Pending JANPAK    U.S. Federal    4388206   
08/20/2013    Interline Brands, Inc.    Registered LOGO [g695748ex10_4pg67.jpg]
   U.S. Federal    4388207    08/20/2013    Interline Brands, Inc.    Registered
JANPAK IN-SITE    U.S. Federal    (86049788)    (08/28/2013)    Interline
Brands, Inc.    Pending JANPAK IN-SITE    U.S. Federal    (86049903)   
(08/28/2013)    Interline Brands, Inc.    Pending LEGEND    U.S. Federal   
4470,883    01/21/2014    Interline Brands, Inc.    Registered

 

36

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

Mark

  

Jurisdiction

  

Reg. No.

(serial no.)

  

Registered

(Filed)

  

Owner

  

Status - Liens

LOGO [g695748ex10_4pg68.jpg]    U.S. Federal    4480679    02/11/2014   
Interline Brands, Inc.    Registered LIME TAMER    U.S. Federal    1539892   
05/23/1989    Interline Brands, Inc.    Registered LIQUI-ZYME    U.S. Federal   
2258587    07/06/1999    Interline Brands, Inc.    Registered LOCK-TOP    U.S.
Federal    2947569    05/10/2005    Interline Brands, Inc.    Registered
LYEMANCE    U.S. Federal    2984827    08/16/2005    Interline Brands, Inc.   
Registered MAINTENANCE USA    U.S. Federal    3980581    06/21/2011    Interline
Brands, Inc.    Registered MONUMENT    U.S. Federal    4358295    06/25/2013   
Interline Brands, Inc.    Registered NATURE - GREEN    U.S. Federal    2107994
   10/21/1997    Interline Brands, Inc.    Registered NEO-TITE    U.S. Federal
   1917954    09/12/1995    Interline Brands, Inc.    Registered PREFERRED
INDUSTRIES    U.S. Federal    3224101    04/03/2007    Interline Brands, Inc.   
Registered PREFERRED INDUSTRIES    U.S. Federal    (86135738)    (12/05/2013)   
Interline Brands, Inc.    Pending PREMIER    U.S. Federal    2215678   
01/05/1999    Interline Brands, Inc.    Registered PREMIER    U.S. Federal   
3250866    06/12/2007    Interline Brands, Inc.    Registered PREMIERPLUS   
U.S. Federal    2945744    05/03/2005    Interline Brands, Inc.    Registered
PROFORMA    U.S. Federal    3372877    01/22/2008    Interline Brands, Inc.   
Registered PROFORMA    U.S. Federal    3394840    03/11/2008    Interline
Brands, Inc.    Registered PROPLUS    U.S. Federal    3978479    06/14/2011   
Interline Brands, Inc.    Registered PROPLUS    U.S. Federal    3716189   
11/24/2009    Interline Brands, Inc.    Registered PROPLUS    U.S. Federal   
3814996    07/06/2010    Interline Brands, Inc.    Registered QLSS    U.S.
Federal    4466365    06/12/2013    Interline Brands, Inc.    Registered
RENOVATIONSPLUS    U.S. Federal    3118706    07/25/2006    Interline Brands,
Inc.    Registered RENOWN    U.S. Federal    3150579    10/03/2006    Interline
Brands, Inc.    Registered RENOWN    U.S. Federal    3158841    10/17/2006   
Interline Brands, Inc.    Registered RIPTIDE    U.S. Federal    4280534   
01/22/2013    Interline Brands, Inc.    Registered ROCHESTER    U.S. Federal   
(86174399)    (01/24/2014)    Interline Brands, Inc.    Pending SECURITY BOW   
U.S. Federal    3573601    02/10/2009    Interline Brands, Inc.    Registered
SEXAUER    U.S. Federal    3917233    02/08/2011    Interline Brands, Inc.   
Registered SEXAUER    U.S. Federal    0533533    11/21/1950    Interline Brands,
Inc.    Registered SEXAUER    U.S. Federal    0536341    01/16/1951    Interline
Brands, Inc.    Registered SEXAUER    U.S. Federal    0848767    05/07/1968   
Interline Brands, Inc.    Registered SEXAUER    U.S. Federal    0880136   
11/04/1969    Interline Brands, Inc.    Registered SEXAUER    U.S. Federal   
2197011    10/20/1998    Interline Brands, Inc.    Registered SEXAUER IN-SITE   
U.S. Federal    (86067557)    (09/18/2013)    Interline Brands, Inc.    Pending

 

37

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Mark

  

Jurisdiction

  

Reg. No.

(serial no.)

  

Registered

(Filed)

  

Owner

  

Status - Liens

SEXAUER IN-SITE    U.S. Federal    (86067566)    (09/18/2013)    Interline
Brands, Inc.    Pending STEEL HARBOR    U.S. Federal    (86127073)   
(11/22/2013)    Interline Brands, Inc.    Pending SUNSTAR LIGHTING    U.S.
Federal    (85819731)    (01/20/2013)    Interline Brands, Inc.    Pending LOGO
[g695748ex10_4pg69a.jpg]    U.S. Federal    (85819997)    (01/20/2013)   
Interline Brands, Inc.    Pending SUPPLIQ    U.S. Federal    (86187082)   
(02/07/2014)    Interline Brands, Inc.    Pending SUPPLYWARE    U.S. Federal   
(86101575)    (10/25/2013    Interline Brands, Inc.    Pending SURE-GRIP    U.S.
Federal    0980821    03/26/1974    Interline Brands, Inc.    Registered TKO   
U.S. Federal    3826390    07/27/2010    Interline Brands, Inc.    Registered
TRAYCO    U.S. Federal    3917267    02/08/2011    Interline Brands, Inc.   
Registered TRAYCO    U.S. Federal    2473132    07/31/2001    Interline Brands,
Inc.    Registered TRAYCO IN-SITE    U.S. Federal    (86069993)    (09/20/2013)
   Interline Brands, Inc.    Pending TRAYCO IN-SITE    U.S. Federal   
(86070011)    (09/20/2013)    Interline Brands, Inc.    Pending TRAYCO logo   
U.S. Federal    3917270    02/08/2011    Interline Brands, Inc.    Registered
U.S. LOCK    U.S. Federal    1163405    08/04/1981    Interline Brands, Inc.   
Registered U.S. LOCK    U.S. Federal    3992289    07/12/2011    Interline
Brands, Inc.    Registered VISIBLE STOCK CONTROL    U.S. Federal    0817247   
10/25/1966    Interline Brands, Inc.    Registered WHEN IT COMES TO KEEPING
CRITTERS OUT OF CHIMNEYS, WE’RE ANIMALS!    U.S. Federal    3298445   
09/25/2007    Interline Brands, Inc.    Registered WILMAR    U.S. Federal   
3904235    01/11/2011    Interline Brands, Inc.    Registered WILMAR    U.S.
Federal    2072965    06/24/1997    Interline Brands, Inc.    Registered WILMAR
(stylized)    U.S. Federal    3907454    01/18/2011    Interline Brands, Inc.   
Registered WILMAR SELECTCARE    U.S. Federal    (86101386)    (10/25/2013)   
Interline Brands, Inc.    Pending WOODFIELD    U.S. Federal    3909893   
01/25/2011    Interline Brands, Inc.    Registered WOODFIELD    U.S. Federal   
3814074    07/06/2010    Interline Brands, Inc.    Registered WOODFIELD    U.S.
Federal    3814137    07/06/2010    Interline Brands, Inc.    Registered
WOODFIELD    U.S. Federal    3847356    09/14/2010    Interline Brands, Inc.   
Registered LOGO [g695748ex10_4pg69b.jpg]    U.S. Federal    (85843765)   
(02/07/2013)    Interline Brands, Inc.    Pending

 

38

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

Mark

  

Jurisdiction

  

Reg. No.

(serial no.)

  

Registered

(Filed)

  

Owner

  

Status - Liens

LOGO [g695748ex10_4pg70a.jpg]    U.S. Federal    (85980984)    (02/07/2013   
Interline Brands, Inc.    Pending HOMEPARTS    U.S. Federal    (85837591)   
(01/31/2013)    Interline Brands, Inc.    Pending HOMEPARTS    U.S. Federal   
(85980965)    (01/31/0213)    Interline Brands, Inc.    Pending HOMEPARTS.COM   
U.S. Federal    (85837667    (01/31/2013)    Interline Brands, Inc.    Pending
LOGO [g695748ex10_4pg70b.jpg]    U.S. Federal    (85474319)    (11/16/2011)   
Interline Brands, Inc.    Pending LOGO [g695748ex10_4pg70bbb.jpg]    U.S.
Federal    (85474331)    (11/16/2011)    Interline Brands, Inc.    Pending
InterlineMRO    U.S. Federal    4176749    07/17/2012    Interline Brands, Inc.
   Registered LOGO [g695748ex10_4pg70c.jpg]    U.S. Federal    4176842   
07/17/2012    Interline Brands, Inc.    Registered DISTINCTIVE, RESPONSIBLE
SOLUTIONS    U.S. Federal    3511747    10/07/2008    Interline Brands, Inc.   
Registered CLEAN ZONE    U.S. Federal    3780306    04/27/2010    Interline
Brands, Inc.    Registered OUR FOCUS IS YOUR ADVANTAGE    U.S. Federal   
(86196470)    (02/18/2014)    Interline Brands, Inc.    Pending

 

39

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EXHIBIT E

(See Section 3.13 of Security Agreement and Definition of “Pledged Collateral”
in Section 1.3 of Security Agreement)

LIST OF PLEDGED COLLATERAL, SECURITIES AND OTHER INVESTMENT PROPERTY

STOCKS

 

Name of Grantor

  

Issuer

   Certificate
Number    Number of
Shares      Class of
Stock    Percentage of
Outstanding
Shares  

Interline Brands, Inc., a New Jersey Corporation

  

IBI Merchandising Services, Inc.

   1      100       Common      100 % 

Interline Brands, Inc., a New Jersey Corporation

  

Wilmar Financial, Inc., a Delaware Corporation

   1      100       Common      100 % 

Interline Brands, Inc., a New Jersey Corporation

  

Glenwood Acquisition LLC, a limited liability company

   N/A      N/A       N/A      100 % 

Interline Brands, Inc., a New Jersey Corporation

  

Barnett of the Caribbean, Inc., A Puerto Rico corporation

   2      65       Common      65 % 

Interline Brands, Inc., a New Jersey Corporation

  

Sexauer Ltd., a Canada company

   Com-3 Reissued      65       Common      65 % 

Interline Brands, Inc., a New Jersey Corporation

  

Interline Brands Hong Kong Limited, a Hong Kong company

   1      650       Common      65 % 

Interline Brands Hong Kong Limited, a Hong Kong company

  

Interline Brands International Trading (Shenzhen) Co. Ltd., a China company

   N/A      N/A       Common      100 % 

Glenwood Acquisition LLC, a limited liability company

  

Buyers Access LLC, a limited liability company

   N/A      N/A       N/A      50 % 

JanPak, LLC

  

JanPak of South Carolina, LLC

              100 % 

JanPak, LLC

  

JanPak of Texas, LLC

              100 % 

JanPak, LLC

  

Zip Technology, LLC

              100 % 

JanPak, LLC

  

JanPak Clean Solutions, LLC

              100 % 

 

40

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

BONDS

None.

GOVERNMENT SECURITIES

None.

OTHER SECURITIES OR OTHER INVESTMENT PROPERTY

(CERTIFICATED AND UNCERTIFICATED)

Ownership of certain de minimis shares of stock acquired in the ordinary course
of business in connection with certain acquisitions or the company’s required
participation in certain retailer programs.

 

Name of Grantor

  

Issuer

  

Number of Shares

  

Class of Stock

   Percentage of
Outstanding Shares  

JanPak, LLC

  

Evolution Insurance Company, Ltd.

   1 unit consisting of 1 voting common share and 1 non-voting preference share
  

Voting Common

Non-voting redeemable preference

     0.1 % 

 

41

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

PLEDGED NOTES

 

Holder

  

Obligor

  

Original Principal Amount

Interline Brands, Inc., a New Jersey corporation    Interline Brands Hong Kong
Limited, a Hong Kong company    Credit line with a maximum amount of $1,000,000,
with $800,000 drawn Wilmar Financials Inc., a Delaware corporation    Interline
Brands, Inc. a New Jersey corporation    Intercompany loan in the amount of
$40,000,000 Intercompany Subordinated Note, dated September 7, 2012.

 

42

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

EXHIBIT F

(See Section 3.1 of Security Agreement)

OFFICES IN WHICH FINANCING STATEMENTS WILL BE FILED

 

Grantor

  

Office

Interline Brands, Inc., a New Jersey corporation    New Jersey Department of
Treasury/Office of the Treasurer/Division of Revenue, Uniform Commercial Code
Section IBI Merchandising Services, Inc.    Secretary of State of the State of
Delaware Wilmar Financial, Inc.    Secretary of State of the State of Delaware
Glenwood Acquisition LLC    Secretary of State of the State of Delaware JanPak,
LLC    Secretary of State of the State of West Virginia JanPak of South
Carolina, LLC    Secretary of State of the State of South Carolina JanPak of
Texas, LLC    Secretary of State of the State of Texas Zip Technology, LLC   
Secretary of State of the State of West Virginia

 

43

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EXHIBIT G

(See Sections 4.4 and 4.8 of Security Agreement)

AMENDMENT

This Amendment, dated                  , 20         (this “Amendment”) is
delivered pursuant to Section 4.4 of the Security Agreement referred to below.
All defined terms herein shall have the meanings ascribed thereto or
incorporated by reference in the Security Agreement. The undersigned hereby
certifies that the representations and warranties in Article III of the Security
Agreement are and continue to be true and correct. The undersigned further
agrees that this Amendment may be attached to that certain Amended and Restated
Pledge and Security Agreement, dated as of March [17], 2014 (as amended,
restated, supplemented or otherwise modified from time to time, the “Security
Agreement”), by and among the undersigned, as the Grantors, and Bank of America,
N.A., as the Administrative Agent, and that the Collateral listed on Schedule I
to this Amendment shall be and become a part of the Collateral referred to in
the Security Agreement, and the undersigned hereby grants a security interest to
the Administrative Agent in all of the Collateral listed on Schedule I to this
Amendment, and all such Collateral shall secure all Secured Obligations referred
to in the Security Agreement.

 

 

By:   Name:  

 

Title:  

 

 

44

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

SCHEDULE I TO AMENDMENT

STOCKS

 

Name of Grantor

   Issuer    Certificate
Number(s)    Number of
Shares    Class of Stock    Percentage of
Outstanding
Shares                                                            

BONDS

 

Name of Grantor

   Issuer    Number    Face Amount    Coupon Rate    Maturity                  
                                         

GOVERNMENT SECURITIES

 

Name of Grantor

   Issuer    Number    Type    Face Amount    Coupon Rate    Maturity         
                                                              

OTHER SECURITIES OR OTHER INVESTMENT PROPERTY

(CERTIFICATED AND UNCERTIFICATED)

 

Name of Grantor

   Issuer    Description of Collateral    Percentage Ownership
Interest                                    

 

45

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

PLEDGED NOTES

 

Holder

   Obligor    Original Principal Amount                        

[Add description of custody accounts or arrangements with securities
intermediary, if applicable]

COMMERCIAL TORT CLAIMS

 

Name of Grantor

   Description of Claim    Parties    Case Number; Name of
Court where Case was
Filed                  

 

46

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EXHIBIT H

FORM OF COPYRIGHT SECURITY AGREEMENT

 

47

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

EXHIBIT H

FORM OF COPYRIGHT SECURITY AGREEMENT

COPYRIGHT SECURITY AGREEMENT

This COPYRIGHT SECURITY AGREEMENT (as it may be amended, restated, supplemented
or modified from time to time, this “Agreement”) is entered into as of
[            ], 20[    ] by and among [                    ], a
[                    ] located at [                    ], and
[                    ], a [                    ] located at
[                    ] (each a “Grantor” and, collectively, “Grantors”), and
Bank of America, N.A., a national banking association located at 300 Galleria
Parkway, Suite 800 Atlanta, Georgia 30339, in its capacity as administrative
agent (in such capacity, the “Administrative Agent”) for itself and the other
Secured Parties (as defined in the Security Agreement referred to below) in
connection with the Credit Agreement referred to below.

R E C I T A L S:

WHEREAS, pursuant to that certain Credit Agreement dated as of September 7, 2012
(as it may be amended, restated, supplemented or modified from time to time, the
“Credit Agreement”), by and among Interline Brands, Inc., a New Jersey
corporation (the “Company”), Interline Brands, Inc., a Delaware corporation,
each subsidiary of the Company listed as a “Borrower” on the signature pages
thereto or that subsequently joins as a “Borrower”, each entity listed as a
“Loan Party” and a “Loan Guarantor” on the signature pages thereto or that
subsequently joins as a “Loan Guarantor”, the Administrative Agent, and the
Lenders from time to time party thereto, the Lenders have agreed to extend
credit to the Borrowers on the terms and conditions specified therein;

WHEREAS, in accordance with the requirements of the Credit Agreement and in
consideration of the credit extended by the Lenders to the Borrowers, the
Grantors, and certain subsidiaries of the Company have executed and delivered
that certain Amended and Restated Pledge and Security Agreement dated as of
March 17, 2014 (as the same may be amended, restated, supplemented or modified
from time to time, the “Security Agreement”) in favor of the Administrative
Agent for the ratable benefit of the Secured Parties, pursuant to which each
Grantor pledged, assigned and granted to the Administrative Agent, on behalf of
and for the ratable benefit of the Secured Parties, a security interest in all
of such Grantor’s right, title and interest in, to and under all of its
Collateral, including the Copyright Collateral (as defined below), in each case
whether now owned by or owing to, or hereafter acquired by or arising in favor
of, such Grantor and whether owned or consigned by or to, or leased from or to,
such Grantor, and regardless of where located, to secure the prompt and complete
payment and performance of the Secured Obligations; and

WHEREAS, pursuant to the Credit Agreement and the Security Agreement, the
Grantors are required to execute and deliver this Agreement;

 

H-1

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

NOW, THEREFORE, for valuable consideration hereby acknowledged, the Grantors and
the Administrative Agent, on behalf of the Secured Parties, hereby agree as
follows:

Section 1. Defined Terms. All capitalized terms used herein and not otherwise
defined shall have the meanings assigned to such terms in the Security
Agreement.

Section 2. Grant of Security Interest.

Each Grantor hereby pledges, assigns, and grants to the Administrative Agent, on
behalf of and for the ratable benefit of the Secured Parties, a continuing
security interest in and Lien upon all of such Grantor’s right, title and
interest in, to and under the following property, in each case, whether now
owned by or owing to, or hereafter acquired by or arising in favor of, such
Grantor (including under any trade name or derivations thereof) and whether
owned by or consigned by or to, or leased from or to, such Grantor, and
regardless of where located (collectively, the “Copyright Collateral”):

(a) all copyright registrations and copyright registration applications set
forth on Schedule I hereto;

(b) all mask works, as defined under 17 U.S.C. § 901, et seq, and applications
and registrations thereof;

(c) all renewals or extensions of any of the foregoing;

(d) all income, royalties, damages and payments now or hereafter due and/or
payable under any of the foregoing, including, without limitation, damages or
payments for past or future infringements for any of the foregoing;

(e) all rights to sue for past, present and future infringements of any of the
foregoing;

(f) all rights corresponding to any of the foregoing throughout the world;

(g) (i) all licensing agreements, consents to use, covenants not to sue or
similar arrangements in and to any copyrights, (ii) all income, royalties,
damages, claims and payments now or hereafter due or payable under and with
respect thereto, including without limitation, damages and payments for past,
present and future breaches thereof, and (iii) all rights to sue for past,
present and future breaches thereof; and

(h) all accessions to, substitutions for and replacements, products, and cash
and non-cash proceeds of the foregoing;

to secure the prompt and complete payment and performance of the Secured
Obligations.

 

H-2

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

Section 3. Security Agreement.

The security interests granted pursuant to this Agreement are granted in
conjunction with the security interests granted to the Administrative Agent
pursuant to the Security Agreement, and each Grantor hereby acknowledges and
affirms that the rights and remedies of the Administrative Agent with respect to
the security interest in the Copyright Collateral made and granted hereby are
more fully set forth in the Security Agreement, the terms and provisions of
which are incorporated by reference herein as if fully set forth herein. In the
event of any irreconcilable conflict between the terms of this Agreement and the
terms of the Security Agreement, the Administrative Agent shall determine, in
its discretion, which terms shall control.

Section 4. Release.

The Liens granted hereunder shall terminate concomitantly with the Liens granted
under the Security Agreement in accordance with its terms.

Section 5. Modification of Agreement.

This Agreement or any provision hereof may not be changed, waived, or terminated
except in accordance with the amendment provisions of the Security Agreement.
Notwithstanding the foregoing, the Administrative Agent may modify this
Agreement, after obtaining the applicable Grantor’s approval of or signature to
such modification, by amending Schedule 1 to include reference to any right,
title or interest in any Copyright Collateral currently owned by such Grantor or
any Copyright Collateral acquired by such Grantor after the execution hereof or
to delete any reference to any right, title or interest in any Copyright
Collateral in which such Grantor no longer has or claims any right, title or
interest.

Section 6. CHOICE OF LAW.

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO THE FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS.

Section 7. Counterparts.

This Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one agreement, and any parties hereto may execute this
Agreement by signing any such counterpart. Delivery of an executed counterpart
of a signature page to this Agreement by facsimile or other electronic
transmission (including portable document format (“.pdf”) or similar format)
shall be effective as delivery of a manually executed counterpart of this
Agreement.

[SIGNATURE PAGE FOLLOWS]

 

H-3

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

IN WITNESS WHEREOF, intending to be legally bound, each Grantor has caused this
COPYRIGHT SECURITY AGREEMENT to be duly executed and delivered by its duly
authorized officer as of the date first set forth above.

 

[                                         ] By:  

 

  Name:   Title: [                                         ] By:  

 

  Name:   Title:

 

ACCEPTED AND AGREED as of the date first above written:

BANK OF AMERICA, N.A.,

as Administrative Agent

By:  

 

  Name:   Title:

 

H-4

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

ACKNOWLEDGEMENT OF GRANTOR

 

STATE OF  

 

  )       )   ss. COUNTY OF  

 

  )  

On this [     ] day of [            ], 20[    ] before me personally appeared
[                    ], proved to me on the basis of satisfactory evidence to be
the person who executed the foregoing instrument on behalf of
[                    ], who being by me duly sworn did depose and say that he is
an authorized officer of said [corporation/limited liability company], that the
said instrument was signed on behalf of said [corporation/limited liability
company] as authorized by its [Board of Directors/Member(s)/Manager(s)] and that
he acknowledged said instrument to be the free act and deed of said
[corporation/limited liability company].

 

Notary Public  

 

My Commission Expires:  

 

 

H-5

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

ACKNOWLEDGEMENT OF GRANTOR

 

STATE OF  

 

  )       )   ss. COUNTY OF  

 

  )  

On this [    ] day of [            ], 20[    ] before me personally appeared
[                    ], proved to me on the basis of satisfactory evidence to be
the person who executed the foregoing instrument on behalf of
[                    ], who being by me duly sworn did depose and say that he is
an authorized officer of said [corporation/limited liability company], that the
said instrument was signed on behalf of said [corporation/limited liability
company] as authorized by its [Board of Directors/Member(s)/Manager(s)] and that
he acknowledged said instrument to be the free act and deed of said
[corporation/limited liability company].

 

Notary Public  

 

My Commission Expires:  

 

 

H-6

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

ACKNOWLEDGEMENT OF ADMINISTRATIVE AGENT

 

STATE OF  

 

  )       )   ss. COUNTY OF  

 

  )  

On this [    ] day of [            ], 20[    ] before me personally appeared
[                    ], proved to me on the basis of satisfactory evidence to be
the person who executed the foregoing instrument on behalf of Bank of America,
N.A., a national banking association, who being by me duly sworn did depose and
say that he is an authorized officer of said bank, that the said instrument was
signed on behalf of said bank as authorized by its bylaws or a resolution of its
Board of Directors and that he acknowledged said instrument to be the free act
and deed of said bank.

 

Notary Public  

 

My Commission Expires:  

 

 

H-7

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

SCHEDULE I

TO

COPYRIGHT SECURITY AGREEMENT

 

H-8

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

EXHIBIT I

FORM OF PATENT SECURITY AGREEMENT

 

48

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

EXHIBIT I

FORM OF PATENT SECURITY AGREEMENT

PATENT SECURITY AGREEMENT

This PATENT SECURITY AGREEMENT (as it may be amended, restated, supplemented or
modified from time to time, this “Agreement”) is entered into as of
[            ], 20[    ] by and among [                    ], a
[                    ] located at [                    ], and
[                    ], a [                    ] located at
[                    ] (each a “Grantor” and, collectively, “Grantors”), and
Bank of America, N.A., a national banking association located at 300 Galleria
Parkway, Suite 800 Atlanta, Georgia 30339, in its capacity as administrative
agent (in such capacity, the “Administrative Agent”) for itself and the other
Secured Parties (as defined in the Security Agreement referred to below) in
connection with the Credit Agreement referred to below.

R E C I T A L S:

WHEREAS, pursuant to that certain Credit Agreement dated as of September 7, 2012
(as it may be amended, restated, supplemented or modified from time to time, the
“Credit Agreement”), by and among Interline Brands, Inc., a New Jersey
corporation (the “Company”), Interline Brands, Inc., a Delaware corporation,
each subsidiary of the Company listed as a “Borrower” on the signature pages
thereto or that subsequently joins as a “Borrower”, each entity listed as a
“Loan Party” and a “Loan Guarantor” on the signature pages thereto or that
subsequently joins as a “Loan Guarantor”, the Administrative Agent, and the
Lenders from time to time party thereto, the Lenders have agreed to extend
credit to the Borrowers on the terms and conditions specified therein;

WHEREAS, in accordance with the requirements of the Credit Agreement and in
consideration of the credit extended by the Lenders to the Borrowers, the
Grantors, and certain subsidiaries of the Company have executed and delivered
that certain Amended and Restated Pledge and Security Agreement dated as of
March 17, 2014 (as the same may be amended, restated, supplemented or modified
from time to time, the “Security Agreement”) in favor of the Administrative
Agent for the ratable benefit of the Secured Parties, pursuant to which each
Grantor pledged, assigned and granted to the Administrative Agent, on behalf of
and for the ratable benefit of the Secured Parties, a security interest in all
of such Grantor’s right, title and interest in, to and under all of its
Collateral, including the Patent Collateral (as defined below), in each case
whether now owned by or owing to, or hereafter acquired by or arising in favor
of, such Grantor and whether owned or consigned by or to, or leased from or to,
such Grantor, and regardless of where located, to secure the prompt and complete
payment and performance of the Secured Obligations; and

WHEREAS, pursuant to the Credit Agreement and the Security Agreement, the
Grantors are required to execute and deliver this Agreement;

 

I-1

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

NOW, THEREFORE, for valuable consideration hereby acknowledged, the Grantors and
the Administrative Agent, on behalf of the Secured Parties, hereby agree as
follows:

Section 1. Defined Terms. All capitalized terms used herein and not otherwise
defined shall have the meanings assigned to such terms in the Security
Agreement.

Section 2. Grant of Security Interest.

Each Grantor hereby pledges, assigns, and grants to the Administrative Agent, on
behalf of and for the ratable benefit of the Secured Parties, a continuing
security interest in and Lien upon all of such Grantor’s right, title and
interest in, to and under the following property, in each case, whether now
owned by or owing to, or hereafter acquired by or arising in favor of, such
Grantor (including under any trade name or derivations thereof) and whether
owned by or consigned by or to, or leased from or to, such Grantor, and
regardless of where located (collectively, the “Patent Collateral”):

(a) any and all patents and patent applications set forth on Schedule I hereto;

(b) all inventions and improvements claimed therein;

(c) all reissues, divisions, continuations, extensions and continuations-in-part
of the foregoing;

(d) all income, royalties, damages, claims and payments now or hereafter due or
payable under and with respect to the foregoing, including, without limitation,
damages and payments for past, present and future infringements of the
foregoing;

(e) all rights to sue for past, present and future infringements of the
foregoing;

(f) all rights corresponding to any of the foregoing throughout the world;

(g) (i) all licensing agreements, consents to use, covenants not to sue or
similar arrangements in and to any patents, (ii) all income, royalties, damages,
claims and payments now or hereafter due or payable under and with respect
thereto, including without limitation, damages and payments for past, present
and future breaches thereof, and (iii) all rights to sue for past, present and
future breaches thereof; and

(h) all accessions to, substitutions for and replacements, products, and cash
and non-cash proceeds of the foregoing;

to secure the prompt and complete payment and performance of the Secured
Obligations.

Section 3. Security Agreement.

The security interests granted pursuant to this Agreement are granted in
conjunction with the security interests granted to the Administrative Agent
pursuant to the Security Agreement, and each Grantor hereby acknowledges and
affirms that the rights and

 

I-2

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

remedies of the Administrative Agent with respect to the security interest in
the Patent Collateral made and granted hereby are more fully set forth in the
Security Agreement, the terms and provisions of which are incorporated by
reference herein as if fully set forth herein. In the event of any
irreconcilable conflict between the terms of this Agreement and the terms of the
Security Agreement, the Administrative Agent shall determine, in its discretion,
which terms shall control.

Section 4. Release.

The Liens granted hereunder shall terminate concomitantly with the Liens granted
under the Security Agreement in accordance with its terms.

Section 5. Modification of Agreement.

This Agreement or any provision hereof may not be changed, waived, or terminated
except in accordance with the amendment provisions of the Security Agreement.
Notwithstanding the foregoing, the Administrative Agent may modify this
Agreement, after obtaining the applicable Grantor’s approval of or signature to
such modification, by amending Schedule 1 to include reference to any right,
title or interest in any Patent Collateral currently owned by such Grantor or
any Patent Collateral acquired by such Grantor after the execution hereof or to
delete any reference to any right, title or interest in any Patent Collateral in
which such Grantor no longer has or claims any right, title or interest.

Section 6. CHOICE OF LAW.

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO THE FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS.

Section 7. Counterparts.

This Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one agreement, and any parties hereto may execute this
Agreement by signing any such counterpart. Delivery of an executed counterpart
of a signature page to this Agreement by facsimile or other electronic
transmission (including portable document format (“.pdf”) or similar format)
shall be effective as delivery of a manually executed counterpart of this
Agreement.

[SIGNATURE PAGE FOLLOWS]

 

I-3

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

IN WITNESS WHEREOF, intending to be legally bound, each Grantor has caused this
PATENT SECURITY AGREEMENT to be duly executed and delivered by its duly
authorized officer as of the date first set forth above.

 

[                                         ] By:  

 

  Name:   Title: [                                         ] By:  

 

  Name:   Title:

 

ACCEPTED AND AGREED as of the date first above written:

BANK OF AMERICA, N.A.,

as Administrative Agent

By:  

 

  Name:   Title:

 

I-4

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

ACKNOWLEDGEMENT OF GRANTOR

 

STATE OF  

 

  )       )   ss. COUNTY OF  

 

  )  

On this [    ] day of [            ], 20[    ] before me personally appeared
[                    ], proved to me on the basis of satisfactory evidence to be
the person who executed the foregoing instrument on behalf of
[                    ], who being by me duly sworn did depose and say that he is
an authorized officer of said [corporation/limited liability company], that the
said instrument was signed on behalf of said [corporation/limited liability
company] as authorized by its [Board of Directors/Member(s)/Manager(s)] and that
he acknowledged said instrument to be the free act and deed of said
[corporation/limited liability company].

 

Notary Public  

 

My Commission Expires:  

 

 

I-5

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

ACKNOWLEDGEMENT OF GRANTOR

 

STATE OF  

 

  )       )   ss. COUNTY OF  

 

  )  

On this [    ] day of [            ], 20[    ] before me personally appeared
[                    ], proved to me on the basis of satisfactory evidence to be
the person who executed the foregoing instrument on behalf of
[                    ], who being by me duly sworn did depose and say that he is
an authorized officer of said [corporation/limited liability company], that the
said instrument was signed on behalf of said [corporation/limited liability
company] as authorized by its [Board of Directors/Member(s)/Manager(s)] and that
he acknowledged said instrument to be the free act and deed of said
[corporation/limited liability company].

 

Notary Public  

 

My Commission Expires:  

 

 

I-6

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

ACKNOWLEDGEMENT OF ADMINISTRATIVE AGENT

 

STATE OF  

 

  )       )   ss. COUNTY OF  

 

  )  

On this [    ] day of [            ], 20[    ] before me personally appeared
[                    ], proved to me on the basis of satisfactory evidence to be
the person who executed the foregoing instrument on behalf of Bank of America,
N.A., a national banking association, who being by me duly sworn did depose and
say that he is an authorized officer of said bank, that the said instrument was
signed on behalf of said bank as authorized by its bylaws or a resolution of its
Board of Directors and that he acknowledged said instrument to be the free act
and deed of said bank.

 

Notary Public  

 

My Commission Expires:  

 

 

I-7

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

SCHEDULE I

TO

PATENT SECURITY AGREEMENT

 

I-8

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

EXHIBIT J

FORM OF TRADEMARK SECURITY AGREEMENT

 

49

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

EXHIBIT J

FORM OF TRADEMARK SECURITY AGREEMENT

TRADEMARK SECURITY AGREEMENT

This TRADEMARK SECURITY AGREEMENT (as it may be amended, restated, supplemented
or modified from time to time, this “Agreement”) is entered into as of
[            ], 20[    ] by and among [                    ], a
[                    ] located at [                    ], and
[                    ], a [                    ] located at
[                    ] (each a “Grantor” and, collectively, “Grantors”), and
Bank of America, N.A., a national banking association located at 300 Galleria
Parkway, Suite 800 Atlanta, Georgia 30339, in its capacity as administrative
agent (in such capacity, the “Administrative Agent”) for itself and the other
Secured Parties (as defined in the Security Agreement referred to below) in
connection with the Credit Agreement referred to below.

R E C I T A L S:

WHEREAS, pursuant to that certain Credit Agreement dated as of September 7, 2012
(as it may be amended, restated, supplemented or modified from time to time, the
“Credit Agreement”), by and among Interline Brands, Inc., a New Jersey
corporation (the “Company”), Interline Brands, Inc., a Delaware corporation,
each subsidiary of the Company listed as a “Borrower” on the signature pages
thereto or that subsequently joins as a “Borrower”, each entity listed as a
“Loan Party” and a “Loan Guarantor” on the signature pages thereto or that
subsequently joins as a “Loan Guarantor”, the Administrative Agent, and the
Lenders from time to time party thereto, the Lenders have agreed to extend
credit to the Borrowers on the terms and conditions specified therein;

WHEREAS, in accordance with the requirements of the Credit Agreement and in
consideration of the credit extended by the Lenders to the Borrowers, the
Grantors and certain subsidiaries of the Company have executed and delivered
that certain Amended and Restated Pledge and Security Agreement dated as of
March 17, 2014 (as the same may be amended, restated, supplemented or modified
from time to time, the “Security Agreement”) in favor of the Administrative
Agent for the ratable benefit of the Secured Parties, pursuant to which each
Grantor pledged, assigned and granted to the Administrative Agent, on behalf of
and for the ratable benefit of the Secured Parties, a security interest in all
of such Grantor’s right, title and interest in, to and under all of its
Collateral, including the Trademark Collateral (as defined below), in each case
whether now owned by or owing to, or hereafter acquired by or arising in favor
of, such Grantor and whether owned or consigned by or to, or leased from or to,
such Grantor, and regardless of where located, to secure the prompt and complete
payment and performance of the Secured Obligations; and

WHEREAS, pursuant to the Credit Agreement and the Security Agreement, the
Grantors are required to execute and deliver this Agreement;

 

J-1

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

NOW, THEREFORE, for valuable consideration hereby acknowledged, the Grantors and
the Administrative Agent, on behalf of the Secured Parties, hereby agree as
follows:

Section 1. Defined Terms. All capitalized terms used herein and not otherwise
defined shall have the meanings assigned to such terms in the Security
Agreement.

Section 2. Grant of Security Interest.

Each Grantor hereby pledges, assigns, and grants to the Administrative Agent, on
behalf of and for the ratable benefit of the Secured Parties, a continuing
security interest in and Lien upon all of such Grantor’s right, title and
interest in, to and under the following property, in each case, whether now
owned by or owing to, or hereafter acquired by or arising in favor of, such
Grantor (including under any trade name or derivations thereof) and whether
owned by or consigned by or to, or leased from or to, such Grantor, and
regardless of where located (collectively, the “Trademark Collateral”):

(a) all trademarks (including service marks), and the registrations and
applications for registration thereof including, but not limited to, U.S.
registered trademarks and service marks and U.S. trademarks and service marks
applications, set forth on Schedule I hereto;

(b) all goodwill of the business connected with the use of and symbolized by the
foregoing;

(c) all renewals of the foregoing;

(d) all income, royalties, damages, claims and payments now or hereafter due or
payable under and with respect to the foregoing, including, without limitation,
damages, claims and payments for past, present and future infringements thereof;

(e) all rights to sue for past, present and future infringements of the
foregoing, including, without limitation, all rights to settle suits involving
claims and demands for royalties owing;

(f) all rights corresponding to any of the foregoing throughout the world;

(g) (i) all licensing agreements, consents to use, covenants not to sue or
similar arrangements in and to any trademarks, (ii) all income, royalties,
damages, claims and payments now or hereafter due or payable under and with
respect thereto, including without limitation, damages and payments for past,
present and future breaches thereof, and (iii) all rights to sue for past,
present and future breaches thereof; and

(h) all accessions to, substitutions for and replacements, products, and cash
and non-cash proceeds of the foregoing;

to secure the prompt and complete payment and performance of the Secured
Obligations. Notwithstanding the foregoing, the Trademark Collateral shall not
include any trademark

 

J-2

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

application filed in the USPTO on the basis of a Grantor’s intent-to-use such
trademark prior to the filing of a “Statement of Use” pursuant to Section 1(d)
of the Lanham Act or an “Amendment to Allege Use” pursuant to Section 1(c) of
the Lanham Act with respect thereto, to the extent, and only for so long as, the
granting by a Grantor of a security interest therein would result in the loss by
such Grantor of any material rights therein, or impair the validity or
enforceability of any registration that issues therefrom under applicable
federal law.

Section 3. Security Agreement.

The security interests granted pursuant to this Agreement are granted in
conjunction with the security interests granted to the Administrative Agent
pursuant to the Security Agreement, and each Grantor hereby acknowledges and
affirms that the rights and remedies of the Administrative Agent with respect to
the security interest in the Trademark Collateral made and granted hereby are
more fully set forth in the Security Agreement, the terms and provisions of
which are incorporated by reference herein as if fully set forth herein. In the
event of any irreconcilable conflict between the terms of this Agreement and the
terms of the Security Agreement, the Administrative Agent shall determine, in
its discretion, which terms shall control.

Section 4. Release.

The Liens granted hereunder shall terminate concomitantly with the Liens granted
under the Security Agreement in accordance with its terms.

Section 5. Modification of Agreement.

This Agreement or any provision hereof may not be changed, waived, or terminated
except in accordance with the amendment provisions of the Security Agreement.
Notwithstanding the foregoing, the Administrative Agent may modify this
Agreement, after obtaining the applicable Grantor’s approval of or signature to
such modification, by amending Schedule 1 to include reference to any right,
title or interest in any Trademark Collateral currently owned by such Grantor or
any Trademark Collateral acquired by such Grantor after the execution hereof or
to delete any reference to any right, title or interest in any Trademark
Collateral in which such Grantor no longer has or claims any right, title or
interest.

Section 6. CHOICE OF LAW.

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO THE FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS.

Section 7. Counterparts.

This Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one agreement, and any parties hereto may execute this
Agreement by signing any such counterpart. Delivery of an executed counterpart
of a signature page to this Agreement by facsimile or other electronic
transmission (including portable document format (“.pdf”) or similar format)
shall be effective as delivery of a manually executed counterpart of this
Agreement.

[SIGNATURE PAGE FOLLOWS]

 

J-3

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

IN WITNESS WHEREOF, intending to be legally bound, each Grantor has caused this
TRADEMARK SECURITY AGREEMENT to be duly executed and delivered by its duly
authorized officer as of the date first set forth above.

 

[                                         ] By:  

 

  Name:   Title: [                                         ] By:  

 

  Name:   Title:

 

ACCEPTED AND AGREED as of the date first above written:

BANK OF AMERICA, N.A.,

as Administrative Agent

By:  

 

  Name:   Title:

 

J-4

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

ACKNOWLEDGEMENT OF GRANTOR

 

STATE OF  

 

  )     )   ss. COUNTY OF  

 

  )

On this [    ] day of [            ], 20[    ] before me personally appeared
[                    ], proved to me on the basis of satisfactory evidence to be
the person who executed the foregoing instrument on behalf of
[                    ], who being by me duly sworn did depose and say that he is
an authorized officer of said [corporation/limited liability company], that the
said instrument was signed on behalf of said [corporation/limited liability
company] as authorized by its [Board of Directors/Member(s)/Manager(s)] and that
he acknowledged said instrument to be the free act and deed of said
[corporation/limited liability company].

 

Notary Public  

 

 

My Commission Expires:  

 

 

J-5

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

ACKNOWLEDGEMENT OF GRANTOR

 

STATE OF  

 

  )     )   ss. COUNTY OF  

 

  )

On this [    ] day of [            ], 20[    ] before me personally appeared
[                    ], proved to me on the basis of satisfactory evidence to be
the person who executed the foregoing instrument on behalf of
[                    ], who being by me duly sworn did depose and say that he is
an authorized officer of said [corporation/limited liability company], that the
said instrument was signed on behalf of said [corporation/limited liability
company] as authorized by its [Board of Directors/Member(s)/Manager(s)] and that
he acknowledged said instrument to be the free act and deed of said
[corporation/limited liability company].

 

Notary Public  

 

 

My Commission Expires:  

 

 

J-6

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

ACKNOWLEDGEMENT OF ADMINISTRATIVE AGENT

 

STATE OF  

 

  )     )   ss. COUNTY OF  

 

  )

On this [    ] day of [            ], 20[    ] before me personally appeared
[                    ], proved to me on the basis of satisfactory evidence to be
the person who executed the foregoing instrument on behalf of Bank of America,
N.A., a national banking association, who being by me duly sworn did depose and
say that he is an authorized officer of said bank, that the said instrument was
signed on behalf of said bank as authorized by its bylaws or a resolution of its
Board of Directors and that he acknowledged said instrument to be the free act
and deed of said bank.

 

Notary Public  

 

 

My Commission Expires:  

 

 

J-7

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

SCHEDULE I

TO

TRADEMARK SECURITY AGREEMENT

 

J-8

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

EXHIBIT K

COMMERCIAL TORT CLAIMS

None.

 

50

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

EXHIBIT B-I

(See Sections 3.5 and 7.1 of Security Agreement)

DEPOSIT ACCOUNTS

 

Name of Grantor

  

Name of Institution

  

Account Number

  

Check here if

Deposit Account

is a Collateral

Deposit Account

  

Description of

Deposit Account

if not a Collateral

Deposit Account

                                                           

SECURITIES ACCOUNTS

 

Name of Grantor

  

Name of Institution

              

COMMODITIES ACCOUNTS

 

Name of Grantor

  

Name of Institution

              

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

EXHIBIT B-II

(See Section 3.1 of Security Agreement)

CONTROL AGREEMENTS

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

EXHIBIT C

(See Section 3.7 of Security Agreement)

LETTER OF CREDIT RIGHTS

CHATTEL PAPER

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

EXHIBIT D

(See Sections 3.10 and 3.11 of Security Agreement)

INTELLECTUAL PROPERTY RIGHTS

PATENTS

 

Name of Grantor

  

Patent Title

  

Patent Number

  

Issue Date

                 

PATENT APPLICATIONS

 

Name of Grantor

  

Patent Application

  

Application Filing Date

  

Application Serial Number

                                   

TRADEMARKS

 

Name of Grantor

  

Trademark

  

Registration Date

  

Registration Number

                          

TRADEMARK APPLICATIONS

 

Name of Grantor

  

Trademark

  

Application Filing Date

  

Application Serial Number

                          

COPYRIGHTS

 

Name of Grantor

  

Title of Work

  

Registration Date

  

Registration Number

                          

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

COPYRIGHT APPLICATIONS

 

Name of Grantor

  

Title of Work

  

Application Filing Date

  

Application Serial Number

                          

INTELLECTUAL PROPERTY LICENSES

 

Name of Grantor

  

Name of Agreement

  

Date of Agreement

  

Parties to Agreement

                          

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

EXHIBIT E

(See Section 3.13 of Security Agreement and Definition of “Pledged Collateral”
in Section 1.3 of Security Agreement)

LIST OF PLEDGED COLLATERAL, SECURITIES AND OTHER INVESTMENT PROPERTY

STOCKS

 

Name of Grantor

   Issuer    Certificate
Number(s)    Number of
Shares    Class of Stock    Percentage of
Outstanding
Shares                                                            

BONDS

 

Name of Grantor

   Issuer    Number    Face Amount    Coupon Rate    Maturity                  
                                         

GOVERNMENT SECURITIES

 

Name of Grantor

   Issuer    Number    Type    Face Amount    Coupon Rate    Maturity         
                                                              

OTHER SECURITIES OR OTHER INVESTMENT PROPERTY

(CERTIFICATED AND UNCERTIFICATED)

 

Name of Grantor

   Issuer    Description of Collateral    Percentage Ownership Interest         
                          

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

PLEDGED NOTES

 

Holder

   Obligor    Original Principal Amount                        

[Add description of custody accounts or arrangements with securities
intermediary, if applicable]

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

EXHIBIT F

(See Section 3.1 of Security Agreement)

OFFICES IN WHICH FINANCING STATEMENTS HAVE BEEN FILED

 

Grantor

 

Office

     

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

EXHIBIT G

(See Sections 4.4 and 4.8 of Security Agreement)

AMENDMENT

This Amendment, dated             , 20     (this “Amendment”) is delivered
pursuant to Section 4.4 of the Security Agreement referred to below. All defined
terms herein shall have the meanings ascribed thereto or incorporated by
reference in the Security Agreement. The undersigned hereby certifies that the
representations and warranties in Article III of the Security Agreement are and
continue to be true and correct. The undersigned further agrees that this
Amendment may be attached to that certain Amended and Restated Pledge and
Security Agreement, dated as of March 17, 2014 (as amended, restated,
supplemented or otherwise modified from time to time, the “Security Agreement”),
by and among the undersigned, as the Grantors, and Bank of America, N.A., as the
Administrative Agent, and that the Collateral listed on Schedule I to this
Amendment shall be and become a part of the Collateral referred to in the
Security Agreement, and the undersigned hereby grants a security interest to the
Administrative Agent in all of the Collateral listed on Schedule I to this
Amendment, and all such Collateral shall secure all Secured Obligations referred
to in the Security Agreement.

 

 

By:   Name:  

 

Title:  

 

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

SCHEDULE I TO AMENDMENT

STOCKS

 

Name of Grantor

   Issuer    Certificate
Number(s)    Number of
Shares    Class of Stock    Percentage of
Outstanding
Shares                                                            

BONDS

 

Name of Grantor

   Issuer    Number    Face Amount    Coupon Rate    Maturity                  
                                         

GOVERNMENT SECURITIES

 

Name of Grantor

   Issuer    Number    Type    Face Amount    Coupon Rate    Maturity         
                                                              

OTHER SECURITIES OR OTHER INVESTMENT PROPERTY

(CERTIFICATED AND UNCERTIFICATED)

 

Name of Grantor

   Issuer    Description of Collateral    Percentage Ownership Interest         
                          

PLEDGED NOTES

 

Holder

   Obligor    Original Principal Amount                        

[Add description of custody accounts or arrangements with securities
intermediary, if applicable]

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

COMMERCIAL TORT CLAIMS

 

Name of Grantor

   Description of Claim    Parties    Case Number; Name of
Court where Case was Filed                  

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

EXHIBIT H

FORM OF COPYRIGHT SECURITY AGREEMENT

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

EXHIBIT I

FORM OF PATENT SECURITY AGREEMENT

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

EXHIBIT J

FORM OF TRADEMARK SECURITY AGREEMENT

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

EXHIBIT K

(See Definition of “Commercial Tort Claims” in Section 1.3 of Security
Agreement)

COMMERCIAL TORT CLAIMS

 

Name of Grantor

   Description of Claim    Parties    Case Number; Name of
Court where Case was Filed