Exhibit
  10.1


	 








CREDIT AGREEMENT


dated as of


April 30, 2009


among


ESCALADE, INCORPORATED


The Lenders Party Hereto


and


JPMORGAN CHASE BANK,
N.A.,

as Administrative Agent


	
 


	 










TABLE OF CONTENTS


	
 

	
 

	
 

	
 


	
ARTICLE
  I Definitions

	
 

	
1


	
SECTION
  1.01.

	
Defined
  Terms.

	
 

	
1


	
SECTION
  1.02.

	
Classification
  of Loans and Borrowings.

	
 

	
20


	
SECTION
  1.03.

	
Terms
  Generally.

	
 

	
20


	
SECTION
  1.04.

	
Accounting
  Terms; Agreement Accounting Principles.

	
 

	
20


	
ARTICLE
  II The Credits

	
 

	
20


	
SECTION
  2.01.

	
Commitments.

	
 

	
20


	
SECTION
  2.02.

	
Loans
  and Borrowings.

	
 

	
21


	
SECTION 2.03.

	
Requests
  for Borrowings.

	
 

	
21


	
SECTION
  2.04.

	
Reserved.

	
 

	
22


	
SECTION
  2.05.

	
Swingline
  Loans.

	
 

	
22


	
SECTION
  2.06.

	
Letters
  of Credit.

	
 

	
23


	
SECTION
  2.07.

	
Funding
  of Borrowings.

	
 

	
26


	
SECTION
  2.08.

	
Interest
  Elections.

	
 

	
27


	
SECTION
  2.09.

	
Termination
  of Commitments.

	
 

	
28


	
SECTION
  2.10.

	
Repayment
  of Loans; Evidence of Debt.

	
 

	
28


	
SECTION
  2.11.

	
Prepayment
  of Loans.

	
 

	
29


	
SECTION
  2.12.

	
Fees.

	
 

	
31


	
SECTION
  2.13.

	
Interest.

	
 

	
31


	
SECTION
  2.14.

	
Alternate
  Rate of Interest.

	
 

	
32


	
SECTION
  2.15.

	
Increased
  Costs.

	
 

	
32


	
SECTION
  2.16.

	
Break
  Funding Payments.

	
 

	
33


	
SECTION
  2.17.

	
Taxes.

	
 

	
34


	
SECTION
  2.18.

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

	
 

	
35


	
SECTION
  2.19.

	
Mitigation
  Obligations; Replacement of Lenders.

	
 

	
37


	
SECTION 2.20. 

	
Returned Payments.

	
 

	
38


	
ARTICLE
  III Representations and Warranties

	
 

	
38


	
SECTION
  3.01.

	
Organization;
  Powers.

	
 

	
38


	
SECTION
  3.02.

	
Authorization;
  Enforceability.

	
 

	
38


	
SECTION
  3.03.

	
Governmental
  Approvals; No Conflicts.

	
 

	
38


	
SECTION
  3.04.

	
Financial
  Statements; No Material Adverse Change.

	
 

	
39


	
SECTION
  3.05.

	
Properties.

	
 

	
39


	
SECTION
  3.06.

	
Litigation
  and Environmental Matters.

	
 

	
39


	
SECTION
  3.07.

	
Compliance
  with Laws and Agreements.

	
 

	
40


	
SECTION
  3.08.

	
Investment
  Company Status.

	
 

	
40


	
SECTION
  3.09.

	
Taxes.

	
 

	
40


	
SECTION
  3.10.

	
ERISA.

	
 

	
40


	
SECTION
  3.11.

	
Disclosure.

	
 

	
40


	
SECTION
  3.12.

	
Material
  Agreements.

	
 

	
41


	
SECTION
  3.13.

	
Solvency.

	
 

	
41


	
SECTION
  3.14.

	
Insurance.

	
 

	
41


	
SECTION
  3.15.

	
Capitalization
  and Subsidiaries.

	
 

	
41


	
SECTION
  3.16.

	
Regulation
  U.

	
 

	
41


	
SECTION 3.17. 

	
Employment Matters.

	
 

	
41


	
SECTION 3.18. 

	
Affiliate
Transactions.

	
 

	
42


	
ARTICLE
  IV Conditions

	
 

	
42


	
SECTION
  4.01.

	
Effective
  Date.

	
 

	
42


	
SECTION
  4.02.

	
Each
  Credit Event.

	
 

	
44


	
SECTION
  4.03.

	
Post-Closing
  Conditions.

	
 

	
45



















	
 

	
 

	
 

	
 


	
ARTICLE
  V Affirmative Covenants

	
 

	
47


	
SECTION
  5.01.

	
Financial
  Statements and Other Information.

	
 

	
47


	
SECTION
  5.02.

	
Notices
  of Material Events.

	
 

	
48


	
SECTION
  5.03.

	
Existence;
  Conduct of Business.

	
 

	
49


	
SECTION
  5.04.

	
Payment
  of Obligations.

	
 

	
49


	
SECTION 5.05.

	
Maintenance
  of Properties.

	
 

	
49


	
SECTION
  5.06.

	
Books
  and Records; Inspection Rights.

	
 

	
50


	
SECTION
  5.07.

	
Compliance
  with Laws.

	
 

	
50


	
SECTION
  5.08.

	
Use
  of Proceeds and Letters of Credit.

	
 

	
50


	
SECTION
  5.09.

	
Insurance.

	
 

	
50


	
SECTION
  5.10.

	
Casualty
  and Condemnation.

	
 

	
50


	
SECTION 5.11. 

	
Appraisals.

	
 

	
51


	
SECTION
  5.12.

	
Depository
  Banks.

	
 

	
51


	
SECTION
  5.13.

	
Additional
  Collateral; Further Assurances

	
 

	
51


	
SECTION
  5.14.

	
Hazardous
  Materials

	
 

	
51


	
SECTION
  5.15.

	
Financial
  Covenants.

	
 

	
53


	
ARTICLE
  VI Negative Covenants

	
 

	
53


	
SECTION
  6.01.

	
Indebtedness.

	
 

	
53


	
SECTION
  6.02.

	
Liens.

	
 

	
54


	
SECTION
  6.03.

	
Fundamental
  Changes.

	
 

	
55


	
SECTION
  6.04.

	
Investments,
  Loans, Advances, Guarantees and Acquisitions.

	
 

	
56


	
SECTION
  6.05.

	
Asset
  Sales.

	
 

	
57


	
SECTION
  6.06.

	
Sale
  and Leaseback Transactions.

	
 

	
58


	
SECTION
  6.07.

	
Swap
  Agreements.

	
 

	
58


	
SECTION
  6.08.

	
Restricted
  Payments; Certain Payments of Indebtedness.

	
 

	
58


	
SECTION
  6.09.

	
Transactions
  with Affiliates.

	
 

	
59


	
SECTION
  6.10.

	
Restrictive
  Agreements.

	
 

	
59


	
SECTION
  6.11.

	
Amendment
  of Material Documents.

	
 

	
59


	
SECTION
  6.12.

	
Capital
  Expenditures.

	
 

	
59


	
SECTION 6.13. 

	
Subsidiaries.

	
 

	
59


	
ARTICLE
  VII Events of Default

	
 

	
60


	
ARTICLE
  VIII The Administrative Agent

	
 

	
62


	
ARTICLE
  IX  Miscellaneous

	
 

	
64


	
SECTION
  9.01.

	
Notices.

	
 

	
64


	
SECTION
  9.02.

	
Waivers;
  Amendments.

	
 

	
65


	
SECTION
  9.03.

	
Expenses;
  Indemnity; Damage Waiver.

	
 

	
67


	
SECTION
  9.04.

	
Successors
  and Assigns.

	
 

	
68


	
SECTION
  9.05.

	
Survival.

	
 

	
71


	
SECTION
  9.06.

	
Counterparts;
  Integration; Effectiveness.

	
 

	
71


	
SECTION
  9.07.

	
Severability.

	
 

	
71


	
SECTION
  9.08.

	
Right
  of Setoff.

	
 

	
72


	
SECTION
  9.09.

	
Governing
  Law; Jurisdiction; Consent to Service of Process.

	
 

	
72


	
SECTION
  9.10.

	
Waiver
  of Jury Trial.

	
 

	
72


	
SECTION
  9.11.

	
Headings.

	
 

	
73


	
SECTION
  9.12.

	
Confidentiality.

	
 

	
73


	
SECTION
  9.13.

	
Several
  Obligations; Nonreliance; Violation of Law.

	
 

	
73


	
SECTION
  9.14.

	
USA
  PATRIOT Act.

	
 

	
73


	
SECTION
  9.15.

	
Disclosure.

	
 

	
73


	
SECTION
  9.16.

	
Appointment for
Perfection.

	
 

	
74


	
SECTION
  9.17.

	
Interest
  Rate Limitation.

	
 

	
74


	
ARTICLE
  X Prior Credit Facilities

	
 

	
74


	
SECTION
  10.01.

	
Waiver of Existing
Defaults.

	
 

	
74


	
SECTION
  10.02.

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

	
 

	
75


	
SECTION
  10.03.

	
Termination of
Commitments.

	
 

	
75










	
 


	
SCHEDULES:


	
 


	
Commitment Schedule


	
Owned Property Schedule


	
Projected EBITDA Schedule


	
Schedule 3.05 -- Properties


	
Schedule 3.06 -- Disclosed Matters


	
Schedule 3.14 -- Insurance


	
Schedule 3.15 -- Capitalization and Subsidiaries 


	
Schedule 3.18 -- Affiliate Transactions


	
Schedule 6.01 -- Existing Indebtedness


	
Schedule 6.02 -- Existing Liens


	
Schedule 6.04 -- Existing Investments


	
Schedule 6.10 -- Existing Restrictions


	
 


	
EXHIBITS:


	
 


	
Exhibit A -- Form of Assignment and Assumption


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


	
Exhibit C -- Form of Compliance Certificate


	
Exhibit D -- Joinder Agreement


	
Exhibit E -- Form of Revolving USD Note


	
Exhibit F -- Form of Revolving Euro Note


	
Exhibit G -- Insurance Requirements


	
Exhibit H -- Martin Yale Letter of Credit










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


          The
parties hereto agree as follows:


ARTICLE I


Definitions



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


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


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


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


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


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


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


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


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


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


1







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



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


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


	
 

	
 


	
 

	
Applicable Rate


	
LIBOR Loans

	
4.50%


	
EURIBOR Loans

	
4.50%


	
Letter of Credit 

	
3.00%


	
ABR Loans

	
2.50%


	
Commitment Fee

	
0.50%





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


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


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


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


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


2






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


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


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


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


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


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



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


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


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


3






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


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


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


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


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


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


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


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


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


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



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


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


4






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


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


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


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



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


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


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



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


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


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


5







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


	
 

	
 

	
 

	
 

	
 


	
EBITDA Test Period

	
 

	
EBITDA Test Period Begins

	
 

	
EBITDA Test Period ends


	 

	 

	 

	 

	 


	
EBITDA
  Test Period 1

	
 

	
December
  27, 2008 

	
 

	
January
  24, 2009


	
EBITDA
  Test Period 2

	
 

	
December
  27, 2008

	
 

	
February 21, 2009


	
EBITDA
  Test Period 3

	
 

	
December
  27, 2008

	
 

	
March 21, 2009


	
EBITDA
  Test Period 4

	
 

	
December
  27, 2008

	
 

	
April 18, 2009


	
EBITDA
  Test Period 5

	
 

	
December
  27, 2008

	
 

	
May 16, 2009


	
EBITDA
  Test Period 6

	
 

	
December
  27, 2008 

	
 

	
June 13, 2009


	
EBITDA
  Test Period 7

	
 

	
December
  27, 2008

	
 

	
July 11, 2009


	
EBITDA
  Test Period 8

	
 

	
December
  27, 2008

	
 

	
August 8, 2009


	
EBITDA
  Test Period 9

	
 

	
December
  27, 2008

	
 

	
September 5, 2009


	
EBITDA
  Test Period 10

	
 

	
December
  27, 2008

	
 

	
October 3, 2009


	
EBITDA
  Test Period 11

	
 

	
December
  27, 2008

	
 

	
October 31, 2009


	
EBITDA
  Test Period 12

	
 

	
December
  27, 2008

	
 

	
November 28, 2009


	
EBITDA
  Test Period 13

	
 

	
December
  27, 2008

	
 

	
December 26, 2009


	
EBITDA
  Test Period 14

	
 

	
December
  27, 2008

	
 

	
January 23, 2010


	
EBITDA
  Test Period 15

	
 

	
December
  27, 2008

	
 

	
February 20, 2010


	
EBITDA
  Test Period 16

	
 

	
December
  27, 2008

	
 

	
March 20, 2010


	
EBITDA
  Test Period 17

	
 

	
December
  27, 2008

	
 

	
April 17, 2010


	
EBITDA
  Test Period 18

	
 

	
December
  27, 2008

	
 

	
May 15, 2010





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


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


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


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


6






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


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


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


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


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


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


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


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


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


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


7






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


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


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


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


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


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


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


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


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


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



8







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


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


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


                    “Indemnified
Taxes” means Taxes other
than Excluded Taxes.


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


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


9






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


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


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


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


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


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


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


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


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



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



10






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



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


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


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


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


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


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


11






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


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


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


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


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


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


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


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


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


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


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


12







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


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


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


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


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


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


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


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


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


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


                    “Permitted
Encumbrances” means:


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


13






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


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


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


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


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


                    “Permitted
Investments” means:


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


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


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


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


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


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


14






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


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


                    “Prepayment
Event” means:


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


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


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


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


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


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


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


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


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


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


15







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


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


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


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


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


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


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


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


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


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


16






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


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


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


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


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


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


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


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


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


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


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


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


17






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


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



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


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


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


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



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


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


18






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


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


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


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


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


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


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


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


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


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


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


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


19







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


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



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


ARTICLE II


The Credits


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


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


20






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


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



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



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


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



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


21






	
 

	
 


	
 

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


	
 

	
 


	
 

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


	
 

	
 


	
 

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


	
 

	
 


	
 

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





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


                    SECTION 2.04. Reserved.


                    SECTION 2.05. Swingline Loans. 



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


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


22







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


                    SECTION 2.06. Letters of Credit. 


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


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


23






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


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



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


24







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



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



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


25







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



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


                    SECTION
2.07. Funding of Borrowings.



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


26






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


                    SECTION
2.08. Interest Elections.


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


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


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


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


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


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


27






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


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


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


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


                    SECTION
2.09. Termination of Commitments.


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


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


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


                    SECTION
2.10. Repayment of Loans; Evidence of Debt.


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


28







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


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


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



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


                    (e)
The obligation of: 


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


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


                    SECTION
2.11. Prepayment of Loans.


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


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


29






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



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



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


30






                    SECTION
2.12. Fees.


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


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


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


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


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


                    SECTION
2.13. Interest.


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


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


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




31






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





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


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


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


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


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


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


                    SECTION
2.15. Increased Costs.


                    (a)
If any Change in Law shall:



32






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




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


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


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


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



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


                    SECTION
2.16. Break Funding Payments.


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


33






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


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


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


                    SECTION
2.17. Taxes.



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


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


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


34






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


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


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


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


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


35







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


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


36







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


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


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


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


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


37







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


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


ARTICLE III


Representations and Warranties


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


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


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


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


38






                    SECTION
3.04. Financial Statements; No Material Adverse Change.


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


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



                    SECTION
3.05. Properties.  


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


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


                    SECTION
3.06. Litigation and Environmental Matters.


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


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


39






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


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


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


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


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


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


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


40







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


                    SECTION
3.13. Solvency.


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


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


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


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


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


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


41






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


ARTICLE IV


Conditions


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


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


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


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


42






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


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


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


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


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


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


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


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


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


43






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


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


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


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


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


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


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


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


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


44






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


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


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


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


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


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


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


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


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


45






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


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


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


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


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


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


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


46






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


ARTICLE V


Affirmative
Covenants


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


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


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


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


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


47






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


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


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


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


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


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


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


                    (a)
the occurrence of any Default;


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


48






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


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


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


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


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


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


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



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


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


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


49






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


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


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


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


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


50






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


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


                    SECTION
5.13. Additional Collateral; Further Assurances. 



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


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


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


51






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


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


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


	
 

	
 

	
 


	
 

	
(i)

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


	
 

	
 

	
 


	
 

	
(ii)

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




52





	
 

	
 

	
 


	
 

	
(iii)

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





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


                    SECTION
5.15. Financial Covenants.


                    (a)
Minimum EBITDA Covenants. 


	
 

	
 

	
 


	
 

	
(i)

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


	
 

	
 

	
 


	
 

	
(ii)

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





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


ARTICLE VI


Negative Covenants


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


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


                    (a)
the Secured Obligations;


53






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


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


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


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


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


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


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


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


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


          (b)
Permitted Encumbrances;


54






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


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


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


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


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



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


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


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


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



55







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


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


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


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


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


          (e)
Guarantees constituting Indebtedness permitted by Section 6.01;


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


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


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


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


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


56






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


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


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


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


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


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


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


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


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


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


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


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


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


57






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


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


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


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


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


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


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


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


58






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



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


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


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


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


59






ARTICLE VII


Events of Default


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


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


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


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


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


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


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


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


60






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


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


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


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


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


          (m)
a Change in Control shall have occurred;


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


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


61






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


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


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


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


ARTICLE VIII


The Administrative
Agent


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


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


62






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


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


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


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


63








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






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


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


ARTICLE IX


Miscellaneous


                    SECTION
9.01. Notices.


                    (a)
Except in the case of notices and other communications expressly permitted to
be given by telephone (and subject to paragraph (b) below), all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by facsimile, at the address or facsimile number
specified below each party’s signature to this agreement, or if to any other
Lender, to it at its address or facsimile number set forth in its
Administrative Questionnaire. All such notices and other communications (i)
sent by hand or overnight courier service, or mailed by certified or registered
mail, shall be deemed to have been given when received or (ii) sent by
facsimile shall be deemed to have been given when sent, provided that if
not given during normal business hours for the recipient, shall be deemed to
have been given at the opening of business on the next Business Day for the recipient.


64






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


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


                    SECTION
9.02. Waivers; Amendments. 


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


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


65








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


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



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


66






                    SECTION
9.03. Expenses; Indemnity; Damage Waiver.


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


          (i)
appraisals and insurance reviews;


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


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


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


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


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


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


67







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



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


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


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


                    SECTION
9.04. Successors and Assigns. 


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


68






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



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


                    (B)
the Administrative Agent; and


                    (C)
the Issuing Bank.


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



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



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


                    (C)
the parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation
fee of $3,500; and


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


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


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


69






                    (iii)
Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment
and Assumption the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obliga­tions under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease
to be a party hereto but shall continue to be entitled to the benefits of
Sections 2.15, 2.16, 2.17 and 9.03). Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with
this Section 9.04 shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance
with paragraph (c) of this Section.



                    (iv)
The Administrative Agent, acting for this purpose as an agent of the Borrower,
shall maintain at one of its offices a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and addresses
of the Lenders, and the Commitment of, and principal amount of the Loans and LC
Disbursements owing to, each Lender pursuant to the terms hereof from time to
time (the “Register”).
The entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent, the Issuing Bank and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower, the
Issuing Bank and any Lender, at any reasonable time and from time to time upon
reasonable prior notice. 



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



                    (c)(i)
Any Lender may, without the consent of the Borrower, the Administrative Agent,
the Issuing Bank or the Swingline Lender, sell participations to one or more
banks or other entities (a “Participant”) in all or a portion of such Lender’s rights and obligations under
this Agreement (including all or a portion of its Commitment and the Loans
owing to it); provided that
(A) such Lender’s obligations under this Agreement shall remain unchanged,
(B) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (C) the Borrower, the
Administrative Agent, the Issuing Bank and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant,
agree to any amendment, modification or waiver described in the first proviso
to Section 9.02(b) that affects such Participant. Subject to paragraph (c)(ii)
of this Section, the Borrower agrees that each Participant shall be entitled to
the benefits of Sections 2.15, 2.16 and 2.17 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 9.08 as though it were a Lender,
provided such Participant agrees to be subject to Section 2.18(c) as though it
were a Lender.  


70






                    (ii)
A Participant shall not be entitled to receive any greater payment under
Section 2.15 or 2.17 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with the Borrower’s prior
written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 2.17 unless the
Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
2.17(e) as though it were a Lender. 



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


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


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


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



71







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


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


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


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


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


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


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


72






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



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


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


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


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


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


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


ARTICLE X


Prior Credit
Facilities


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


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


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


[SIGNATURE PAGE FOLLOWS]


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[SIGNATURE
PAGE TO CREDIT AGREEMENT]


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


	
 

	
 

	
 


	
 

	
ESCALADE, INCORPORATED


	
 

	
 

	
 


	
 

	
By:

	
/s/ DEBORAH J. MEINERT


	
 

	
 

	 


	
 

	
 

	
 Deborah J. Meinert, VP Finance and CFO


	
 

	
 

	
 


	
 

	
Notice Address of
  Escalade, Incorporated: 


	
 

	
817 Maxwell Ave.


	
 

	
Evansville, IN 47711


	
 

	
Attention: Deborah Meinert


	
 

	
Facsimile No: 8120467-1303


	
 

	
 


	
 

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


	
 

	
 


	
 

	
By:

	
/s/ H. ROBERT HILL


	
 

	
 

	 


	
 

	
 

	
 H. Robert Hill, Vice President


	
 

	
 


	
 

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


	
 

	
 


	
 

	
JPMorgan Chase Bank, N.A.


	
 

	
1 East Ohio Street, 4th
  Floor


	
 

	
Indianapolis, IN 46277


	
 

	
Attention: Commercial Lending Group


	
 

	
Facsimile No: (317) 767-8333




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