Exhibit 10.3




	
   

  	
   

  	
   

  






 


FIRST AMENDED AND RESTATED

CREDIT AGREEMENT


 


dated as of


 


December 16, 2009


 


among


 


CUBIC CORPORATION,


 


The Lenders Party Hereto,


 


and


 


JPMORGAN CHASE BANK, N.A.,

as Administrative Agent,


 


BANK OF THE WEST,

as Co-Syndication Agent,


 


UNION BANK, N.A.,

as Co-Syndication Agent


 


U.S. BANK NATIONAL ASSOCIATION,

as Co-Syndication Agent,


 


WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Co-Syndication Agent and


 


BRANCH BANKING AND TRUST COMPANY,

as Documentation Agent


 






 


J.P. MORGAN SECURITIES INC.,

as Sole Bookrunner and Sole Lead Arranger


 




	
   

  	
   

  	
   

  






 

















 


TABLE OF CONTENTS


 


	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  Section 1.01.

  	
  Defined Terms

  	
  1

  
	
  Section 1.02.

  	
  Classification of Loans and Borrowings

  	
  17

  
	
  Section 1.03.

  	
  Terms Generally

  	
  17

  
	
  Section 1.04.

  	
  Accounting Terms; GAAP

  	
  18

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
  THE
  CREDITS

  	
  18

  
	
   

  	
   

  	
   

  
	
  Section 2.01.

  	
  Commitments

  	
  18

  
	
  Section 2.02.

  	
  Loans and Borrowings

  	
  18

  
	
  Section 2.03.

  	
  Requests for Borrowings

  	
  19

  
	
  Section 2.04.

  	
  Swingline Loans

  	
  20

  
	
  Section 2.05.

  	
  Letters of Credit

  	
  21

  
	
  Section 2.06.

  	
  Funding of Borrowings

  	
  24

  
	
  Section 2.07.

  	
  Interest Elections

  	
  25

  
	
  Section 2.08.

  	
  Termination, Reduction and Increase of Commitments

  	
  26

  
	
  Section 2.09.

  	
  Repayment of Loans; Evidence of Debt

  	
  28

  
	
  Section 2.10.

  	
  Prepayment of Loans

  	
  29

  
	
  Section 2.11.

  	
  Fees

  	
  29

  
	
  Section 2.12.

  	
  Interest

  	
  30

  
	
  Section 2.13.

  	
  Alternate Rate of Interest

  	
  31

  
	
  Section 2.14.

  	
  Increased Costs

  	
  31

  
	
  Section 2.15.

  	
  Break Funding Payments

  	
  32

  
	
  Section 2.16.

  	
  Taxes

  	
  33

  
	
  Section 2.17.

  	
  Payments Generally; Pro Rata Treatment; Sharing of
  Set-offs

  	
  34

  
	
  Section 2.18.

  	
  Mitigation Obligations

  	
  36

  
	
  Section 2.19.

  	
  Defaulting Lenders

  	
  36

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
  38

  
	
   

  	
   

  	
   

  
	
  Section 3.01.

  	
  Existence and Power

  	
  38

  
	
  Section 3.02.

  	
  Corporate and Governmental Authorization; No
  Contravention

  	
  38

  
	
  Section 3.03.

  	
  Binding Effect

  	
  38

  
	
  Section 3.04.

  	
  Financial Information

  	
  38

  
					



 


i

















 


TABLE OF CONTENTS


(continued)


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 3.05.

  	
  Litigation

  	
  39

  
	
  Section 3.06.

  	
  Compliance with ERISA

  	
  39

  
	
  Section 3.07.

  	
  Taxes

  	
  39

  
	
  Section 3.08.

  	
  Environmental Compliance

  	
  39

  
	
  Section 3.09.

  	
  Properties

  	
  40

  
	
  Section 3.10.

  	
  Compliance with Laws and Agreements

  	
  41

  
	
  Section 3.11.

  	
  Investment and Holding Company Status

  	
  41

  
	
  Section 3.12.

  	
  Full Disclosure

  	
  41

  
	
  Section 3.13.

  	
  Solvency

  	
  41

  
	
  Section 3.14.

  	
  Employee Matters

  	
  42

  
	
  Section 3.15.

  	
  Use of Proceeds

  	
  42

  
	
  Section 3.16.

  	
  Subsidiaries

  	
  42

  
	
  Section 3.17.

  	
  No Change in Credit Criteria or Collection
  Policies

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IV

  	
  CONDITIONS

  	
  42

  
	
   

  	
   

  	
   

  
	
  Section 4.01.

  	
  Effective Date

  	
  42

  
	
  Section 4.02.

  	
  Each Credit Event

  	
  44

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  V

  	
  AFFIRMATIVE
  COVENANTS

  	
  44

  
	
   

  	
   

  	
   

  
	
  Section 5.01.

  	
  Financial and Business Information

  	
  44

  
	
  Section 5.02.

  	
  Officer’s Certificate

  	
  47

  
	
  Section 5.03.

  	
  Inspection

  	
  47

  
	
  Section 5.04.

  	
  Reporting Treatment of Unrestricted Subsidiaries

  	
  48

  
	
  Section 5.05.

  	
  Compliance with Law

  	
  48

  
	
  Section 5.06.

  	
  Insurance

  	
  48

  
	
  Section 5.07.

  	
  Maintenance of Properties

  	
  49

  
	
  Section 5.08.

  	
  Payment of Taxes and Claims

  	
  49

  
	
  Section 5.09.

  	
  Corporate Existence, Etc.

  	
  49

  
	
  Section 5.10.

  	
  Nature of Business

  	
  49

  
	
  Section 5.11.

  	
  Additional Guarantors

  	
  49

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VI

  	
  NEGATIVE
  COVENANTS

  	
  50

  
	
   

  	
   

  	
   

  
	
  Section 6.01.

  	
  Financial Ratios

  	
  50

  
					



 


ii

















 


TABLE OF CONTENTS


(continued)


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 6.02.

  	
  Limitations on Indebtedness

  	
  50

  
	
  Section 6.03.

  	
  Limitation on Liens

  	
  50

  
	
  Section 6.04.

  	
  Limitation on Sale and Leasebacks

  	
  51

  
	
  Section 6.05.

  	
  Mergers, Consolidations and Sales of Assets and
  Acquisitions

  	
  52

  
	
  Section 6.06.

  	
  Transactions with Affiliates

  	
  53

  
	
  Section 6.07.

  	
  Designation of Subsidiaries

  	
  53

  
	
  Section 6.08.

  	
  Modification of Operating Documents

  	
  54

  
	
  Section 6.09.

  	
  Restrictive Agreements

  	
  54

  
	
  Section 6.10.

  	
  Restricted Payments

  	
  54

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VII

  	
  EVENTS
  OF DEFAULT

  	
  55

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII

  	
  THE
  ADMINISTRATIVE AGENT

  	
  57

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IX

  	
  MISCELLANEOUS

  	
  59

  
	
   

  	
   

  	
   

  
	
  Section 9.01.

  	
  Notices

  	
  59

  
	
  Section 9.02.

  	
  Waivers; Amendments

  	
  60

  
	
  Section 9.03.

  	
  Expenses; Indemnity; Damage Waiver

  	
  61

  
	
  Section 9.04.

  	
  Successors and Assigns

  	
  62

  
	
  Section 9.05.

  	
  Survival

  	
  65

  
	
  Section 9.06.

  	
  Counterparts; Integration; Effectiveness

  	
  65

  
	
  Section 9.07.

  	
  Severability

  	
  66

  
	
  Section 9.08.

  	
  Right of Setoff

  	
  66

  
	
  Section 9.09.

  	
  GOVERNING LAW; Jurisdiction; Consent to Service of
  Process

  	
  66

  
	
  Section 9.10.

  	
  WAIVER OF JURY TRIAL

  	
  67

  
	
  Section 9.11.

  	
  Headings

  	
  67

  
	
  Section 9.12.

  	
  Confidentiality

  	
  67

  
	
  Section 9.13.

  	
  Interest Rate Limitation

  	
  68

  
	
  Section 9.14.

  	
  USA Patriot Act

  	
  68

  
				



 


iii

















 


	
  SCHEDULES

  	
   

  
	
  Schedule 1.01

  	
  Existing Letters of Credit

  
	
  Schedule 2.01

  	
  Commitments

  
	
  Schedule 3.05

  	
  Disclosed Matters as to
  Litigation

  
	
  Schedule 3.08

  	
  Disclosed Matters as to
  Environmental Compliance

  
	
  Schedule 3.16A

  	
  Restricted Subsidiaries

  
	
  Schedule 3.16B

  	
  Unrestricted Subsidiaries

  
	
  Schedule 6.03

  	
  Liens

  
	
   

  	
   

  
	
  EXHIBITS

  	
   

  
	
  Exhibit A

  	
  Form of Assignment
  and Assumption

  
	
  Exhibit B

  	
  Form of Opinion of
  Borrower’s Counsel

  
	
  Exhibit C

  	
  Form of Promissory
  Note

  
	
  Exhibit D

  	
  Form of Guarantee

  
	
  Exhibit E

  	
  Form of Compliance
  Certificate

  



 


iv

















 


FIRST AMENDED AND RESTATED CREDIT AGREEMENT
dated as of December 16, 2009, among CUBIC CORPORATION, a Delaware
corporation (the “Borrower”), the LENDERS party hereto, and JPMORGAN
CHASE BANK, N.A. (“JPMCB”), as Administrative Agent.


 


The Borrower, various lenders and JPMCB, as
administrative agent for such lenders, are parties to that certain Credit
Agreement dated as of March 10, 2005, as amended prior to the date hereof
(as so amended, the “Existing Credit Agreement”); and


 


The parties hereto have agreed that the
Existing Credit Agreement shall be amended and restated in its entirety.


 


Accordingly, the Borrower, the Lenders and
the Administrative Agent (such terms having the respective meanings ascribed to
such terms hereinafter) hereby agree that the Existing Credit Agreement is
amended and restated in its entirety 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.


 


“Adjusted LIBO Rate” means, with
respect to any Eurodollar Borrowing for any Interest Period, an interest rate
per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to (a) the
LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve
Rate.


 


“Administrative Agent” means JPMorgan
Chase Bank, N.A., in its capacity as administrative agent for the Lenders
hereunder or any successor appointed pursuant to Article VIII.


 


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


 


“Affiliate” means, at any time, and
with respect to any Person, (a) any other Person that at such time
directly or indirectly through one or more intermediaries Controls, or is
Controlled by, or is under common Control with, such first Person, and (b) any
Person beneficially owning or holding, directly or indirectly, 10% or more of
any class of voting or equity interests of such Person or any Subsidiary or any
corporation of which such Person and its Subsidiaries beneficially own or hold,
in the aggregate, directly or indirectly, 10% or more of any class of voting or
equity interests.  As used in this
definition, “Control” means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise.  Unless the 


 

















 


context otherwise clearly
requires, any reference to an “Affiliate” is a reference to an Affiliate
of the Borrower.


 


“Alternate Base Rate” means, for any
day, a rate per annum equal to the greatest of (a) the Prime Rate in
effect on such day, (b) the Federal Funds Effective Rate in effect on such
day plus 1/2 of 1% and (c) the Adjusted LIBO Rate for a one month Interest
Period on such day (or if such day is not a Business Day, the immediately
preceding Business Day) plus 1%, provided that, for the avoidance of doubt, the
Adjusted LIBO Rate for any day shall be based on the rate appearing on the
Reuters Screen LIBOR 01 Page (or on any successor or substitute page of
such page) at approximately 11:00 a.m. London time on such day.  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:


 


(a)           with respect to any
ABR Loan or Eurodollar Loan or the Revolving Credit Commitment Fee;


 


(i)            if such day occurs
on or after the Effective Date and prior to the delivery of the first financial
statements referred to in clause (ii) below, (x) with
respect to Loans that are Eurodollar Loans, 2.00%, (y) with respect to
Loans that are ABR Loans, 1.00% and (z) with respect to the Revolving
Credit Commitment Fee, 0.25% and


 


(ii)           if such day occurs
on or after the date upon which the Borrower shall have delivered to the
Administrative Agent the financial statements required to be delivered for the
fiscal period ended September 30, 2009 pursuant to Section 5.01(b),


 


the
rate as set forth below that corresponds to the ratio of Consolidated
Indebtedness to Consolidated Adjusted EBITDA of the Borrower and its Subsidiaries
on a consolidated basis as of the last day of the fiscal quarter or fiscal year
most recently ended prior to such day for which financial statements shall have
been delivered to the Administrative Agent as required pursuant to Section 5.01(a) or
(b) hereof, together with the corresponding compliance certificate
required pursuant to Section 5.02 hereof; provided that any
increase or decrease in the Applicable Rate shall become effective as of the
fifth Business Day immediately following the date the financial statements and
accompanying compliance certificate shall have been delivered for a fiscal
quarter or fiscal year end; and provided, further, that (A) if
the Borrower shall fail to timely deliver such statements and certificates for
any such fiscal quarter or fiscal year period or (B) during the
continuance of an Event of Default, then the Applicable Rate with respect to
ABR Loans and Eurodollar Loans and with respect to the Revolving Credit
Commitment Fee shall be determined for the period (x) from and including
the date upon which such financial statements and certificate were required to
be delivered to but excluding the date upon which financial statements and a
certificate complying with Section 5.0 1(a) or (b) and
Section 5.02 are delivered or (y) from and including the date
from which such Event of 


 


2

















 


Default
shall have occurred but excluding the date upon which such Event of Default is
cured or waived as if the applicable ratio of Consolidated Indebtedness to
Consolidated Adjusted EBITDA of the Borrower and its Subsidiaries was greater
than 2.50:1.00:


 


	
  Ratio of Consolidated Indebtedness

  to Consolidated Adjusted EBITDA

  	
   

  	
  Eurodollar

  Spread for Loans

  	
   

  	
  ABR Spread

  for Loans

  	
   

  	
  Commitment

  Fee

  	
   

  
	
  Less than 1.00 to 1.00

  	
   

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  0.25

  	
  %

  
	
  Greater than or equal to
  1.00 to 1.00 but less than 1.50 to 1.00

  	
   

  	
  2.25

  	
  %

  	
  1.25

  	
  %

  	
  0.30

  	
  %

  
	
  Greater than or equal to
  1.50 to 1.00 but less than 2.00 to 1.00

  	
   

  	
  2.50

  	
  %

  	
  1.50

  	
  %

  	
  0.35

  	
  %

  
	
  Greater than or equal to
  2.00 to 1.00 but less than 2.50 to 1.00

  	
   

  	
  2.75

  	
  %

  	
  1.75

  	
  %

  	
  0.40

  	
  %

  
	
  Greater than or equal to 2.50 to 1.00

  	
   

  	
  3.00

  	
  %

  	
  2.00

  	
  %

  	
  0.50

  	
  %

  



 


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


 


“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.


 


“Availability” means at any time (i) the
total Revolving Loan Commitments minus (ii) the sum at such time of (x) the
unpaid principal balance of all Loans and (y) the LC Exposure.


 


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


 


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


 


“Borrower” has the meaning assigned to
such term in the recitals.


 


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


 


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


 


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


 


3

















 


“Capital Lease” means any lease the
obligation for Rentals with respect to which is required to be capitalized on a
consolidated balance sheet of the lessee and its subsidiaries in accordance
with GAAP.


 


“Capitalized Rentals” of any Person
means as of the date of any determination thereof the amount at which the
aggregate Rentals due and to become due under all Capital Leases under which
such Person is a lessee would be reflected as a liability on a consolidated
balance sheet of such Person.


 


“CERCLA” means the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended.


 


“Change in Control” means (a) the
acquisition by any party, or two or more parties acting in concert, of
beneficial ownership (within the meaning of Rule 13d-3 of the SEC under
the Securities Exchange Act of 1934) of 50% or more of the outstanding shares
of voting stock of the Borrower, or (b) during any period of twelve (12)
consecutive months, a majority of the members of the board of directors or
other equivalent governing body of the Borrower cease to be composed of
individuals (i) who were members of that board or equivalent governing
body of the first day of such period, (ii) whose election or nomination to
that board or equivalent governing body was approved by individuals referred to
in clause (i) above constituting at the time of such election
or nomination at least a majority of that board or equivalent governing body,
or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and
(ii) above constituting at the time of such election or nomination
at least a majority of that board or equivalent governing body (excluding, in
the case of both clause (ii) and clause (iii) ,
any individual whose initial nomination for, or assumption of office as, a
member of that board or equivalent governing body occurs as a result of an
actual or threatened solicitation of proxies or consents for the election or
removal of one or more directors by any person or group other than a solicitation
for the election of one or more directors by or on behalf of the board of
directors); provided, however, that neither the ownership nor
acquisitions of shares of the capital stock of the Borrower by, nor the
transfers of shares of the capital stock of the Borrower between, Members of
the Zable Family shall constitute a Change in Control.


 


“Change in Law” means (a) the
adoption or effectiveness 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
or in effect after the date of this Agreement or (c) compliance by any
Lender (or, for purposes of Section 2.12(b), by any lending office
of such Lender or by such Lender’s holding company, if any) with any request,
guideline or directive (whether or not having the force of law) of any
Governmental Authority made, issued or becoming effective after the date of
this Agreement.


 


“Class,” when used in reference to any
Loan or Borrowing, refers to when such Loans, 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.


 


“Commitment” means a Revolving Loan
Commitment.


 


4

















 


“Consolidated Adjusted EBITDA” means
with respect to the Borrower and its Restricted Subsidiaries for any period
Consolidated EBITDA for such period adjusted to take into account the EBITDA of
any subsequently acquired Person which becomes a Restricted Subsidiary for the
applicable period of calculation which occurred prior to its acquisition so
long as such EBITDA may be verified from audited financial statements.


 


“Consolidated Cash Interest Expense”
means, with respect to the Borrower and its Restricted Subsidiaries for any
period, the interest expense of the Borrower and its Restricted Subsidiaries
during such period determined on a consolidated basis in accordance with GAAP.


 


“Consolidated EBITDA” means with
respect to the Borrower and its Restricted Subsidiaries for any period (a) the
sum of (i) Consolidated Net Income for the Borrower and its Restricted
Subsidiaries, (ii) Consolidated Interest Expense (to the extent deducted
in determining Consolidated Net Income) for the Borrower and its Restricted
Subsidiaries, (iii) taxes, and (iv) depreciation and amortization (to
the extent deducted in determining Consolidated Net Income) and stock
compensation and other non-cash items properly deductible in determining
Consolidated Net Income, calculated on a consolidated basis in accordance with
GAAP, minus (b) non-cash items properly added in determining Consolidated
Net Income for such period, all such calculations to be on a consolidated basis
in accordance with GAAP.


 


“Consolidated Indebtedness” means all
Indebtedness of the Borrower and its Restricted Subsidiaries, determined on a
consolidated basis eliminating intercompany items.


 


“Consolidated Interest Expense” means,
with respect to the Borrower and its Restricted Subsidiaries for any period,
the interest expense of the Borrower and its Restricted Subsidiaries during
such period determined on a consolidated basis in accordance with GAAP, and
shall in any event include, without limitation, (i) the amortization of
debt discounts, (ii) the amortization of all fees payable in connection
with the incurrence of Indebtedness to the extent included in interest expense
and (iii) the portion of any Capitalized Lease allocable to interest
expense.


 


“Consolidated Net Income” for any period
means consolidated net income or net earnings (or any comparable line item) of
the Borrower and its Restricted Subsidiaries, determined in accordance with
GAAP, excluding extraordinary items and gains or loses resulting from changes
in accounting principles and interest income.


 


“Consolidated Net Worth” means, as of
the date of any determination thereof the amount of the capital stock accounts
(net of treasury stock, at cost) plus (or minus in the case of a deficit) the surplus in retained
earnings of the Borrower and its Restricted Subsidiaries as determined in
accordance with GAAP.


 


“Consolidated Total Capitalization”
means as of the date of any determination thereof, the sum of (a) Consolidated
Indebtedness plus (b) Consolidated Net Worth.


 


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


 


“Defaulting Lender” means any Lender,
as determined by the Administrative Agent, that has (a) failed to fund any
portion of its Loans or participations in Letters of Credit or Swingline


 


5
















 


Loans within three Business
Days of the date required to be funded by it hereunder, (b) notified the
Borrower, the Administrative Agent, the Issuing Bank, the Swingline Lender or
any Lender in writing that it does not intend to comply with any of its funding
obligations under this Agreement or has made a public statement to the effect
that it does not intend to comply with its funding obligations under this
Agreement or under other agreements in which it commits to extend credit, (c) failed,
within three Business Days after request by the Administrative Agent, to
confirm that it will comply with the terms of this Agreement relating to its
obligations to fund prospective Loans and participations in then outstanding
Letters of Credit and Swingline Loans, (d) otherwise failed to pay over to
the Administrative Agent or any other Lender any other amount required to be
paid by it hereunder within three Business Days of the date when due, unless
the subject of a good faith dispute, or (e) (i) become or is
insolvent or (ii) become the subject of a bankruptcy or insolvency
proceeding, or has had a receiver, conservator, trustee, administrator,
assignee for the benefit of creditors or similar Person charged with
reorganization or liquidation of its business or custodian, appointed for it,
or has taken any action in furtherance of, or indicating its consent to,
approval of or acquiescence in any such proceeding or appointment.


 


“Disclosed Matters” means the actions,
suits and proceedings and the environmental matters disclosed in Schedules
3.05 and 3.08.


 


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


 


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


 


“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 Materials 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.


 


“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.


 


6

















 


“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 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.


 


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


 


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


 


“Exchange Act” means the Securities
Exchange Act of 1934, as amended.


 


“Excluded Taxes” means, with respect
to the Administrative Agent, any Lender, 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, 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 2.16(a).


 


“Existing Credit Agreement” has the
meaning assigned to such term in the recitals.


 


7

















 


“Existing Letters of Credit” means
those letters of credit more particularly described on Schedule 1.01.


 


“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.


 


“Fee Letter” means the letter dated September 30,
2009 between the Borrower and the Administrative Agent setting forth certain
fees to be paid by the Borrower to the Administrative Agent.


 


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


 


“Financing Documents” means this
Agreement (including the Schedules and Exhibits hereto), the Notes evidencing
Loans, any Guarantee of the Obligations and any other agreement hereafter
created to which the Borrower or any Guarantor is a party that relates to the
obligations of the Borrower or any such Guarantor under any of the foregoing.


 


“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.


 


“Funded Debt” of any Person means (a) all
Indebtedness of such Person for borrowed money or which has been incurred in
connection with the acquisition of assets in each case having a final maturity
of one or more than one year from the date of origin thereof (or which is
renewable or extendible at the option of the obligor for a period or periods
more than one year from the date of origin), including all payments in respect
thereof that are required to be made within one year from the date of any
determination of Funded Debt, whether or not the obligation to make such
payments shall constitute a current liability of the obligor under GAAP, (b) all
Capitalized Rentals of such Person, and (c) all Guaranties by such Person
of Funded Debt of others.


 


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


 


“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” means,
with respect to any Person, any obligation (except the endorsement in the
ordinary course of business of negotiable instruments for deposit or
collection) of such Person guaranteeing or in effect guaranteeing any
Indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by such Person:


 


(a)           to purchase such Indebtedness or
obligation or any property constituting security therefor;


 


(b)           to advance or supply funds (i) for
the purchase or payment of such Indebtedness or obligation, or (ii) to
maintain any working capital or other balance sheet condition or any income
statement condition of any other Person or otherwise to advance or make
available funds for the purchase or payment of such Indebtedness or obligation;


 


(c)           to lease properties or to purchase
properties or services primarily for the purpose of assuring the owner of such
Indebtedness or obligation of the ability of any other Person to make payment
of the Indebtedness or obligation; or


 


(d)           otherwise to assure the owner of such
Indebtedness or obligation against loss in respect thereof.


 


Without limiting the foregoing, in any computation
of the Indebtedness or other liabilities of the obligor under any Guarantee,
the Indebtedness or other obligations that are the subject of such Guarantee
shall be assumed to be direct obligations of such obligor.


 


“Guarantor” means each domestic
Restricted Subsidiary now existing or hereafter created, and executing and
delivering a Guarantee of the Obligations in the form of Exhibit D,
but which in any event shall encompass domestic Restricted Subsidiaries
representing at all times not less than 85% of total assets and
Consolidated EBITDA (computed for the Borrower and its domestic Restricted
Subsidiaries) of the Borrower and all its domestic Restricted Subsidiaries.


 


“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”
with respect to any Person means, at any time, without duplication:


 


(a)           its liabilities for borrowed money,
including, without limitation, deferred payments, and its redemption
obligations in respect of mandatorily redeemable Preferred Stock;


 


(b)           its liabilities for the deferred
purchase price of property acquired by such Person (excluding accounts payable
arising in the ordinary course of business but including all liabilities
created or arising under any conditional sale or other title retention
agreement with respect to any such property);


 


9

















 


(c)           all liabilities appearing on its
balance sheet in accordance with GAAP in respect of Capital Leases;


 


(d)           all liabilities for borrowed money
secured by any Lien with respect to any property owned by such Person (whether
or not it has assumed or otherwise become liable for such liabilities);


 


(e)           all its liabilities in respect of
letters of credit or instruments serving a similar function issued or accepted
for its account by banks and other financial institutions, whether or not
representing obligations for borrowed money, but excluding any commercial
letter of credit entered into in the ordinary course of business by any such
bank or other financial institution relating to the export or import of properties
or any letter of credit entered into in the ordinary course of business by any
such bank or other financial institution relating to the performance by such
Person of its obligations under any contract or agreement (other than any note,
credit, loan or other financial instrument or like agreement);


 


(f)            Swaps of such Person; and


 


(g)           any Guarantee of such Person with
respect to liabilities of a type described in any of clauses (a) through
(f) hereof.


 


Indebtedness of any Person shall include all obligations
of such Person of the character described in clauses (a) through
(g) to the extent such Person remains legally liable in respect
thereof notwithstanding that any such obligation is deemed to be extinguished
under GAAP.


 


“Indemnified Taxes” means Taxes other
than Excluded Taxes.


 


“Interest Election Request” means a
request by the Borrower to convert or continue a Borrowing in accordance with Section 2.07.


 


“Interest Payment Date” means (a) with
respect to any ABR Loan (other than a Swingline Loan), the first day of each
January, April, July and October, (b) with respect to any Eurodollar
Loan, the last day of the Interest Period applicable to the Borrowing of which
such Loan is a part and, in the case of a Eurodollar Borrowing with an Interest
Period of more than 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 (c) with respect to any
Swingline Loan, the day that such Loan is required to be repaid.


 


“Interest Period” means, with respect
to any Eurodollar Borrowing, the period commencing on the date of such
Borrowing and ending on the numerically corresponding day in the calendar month
that is one, two, three or six months thereafter; provided, that (i) if
any Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless, such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar 


 


10

















 


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


 


“Internal Revenue Code” means the
Internal Revenue Code of 1986, as amended, or any successor statute.


 


“Issuing Bank” means JPMorgan Chase
Bank, N.A. or, at the request of the Borrower and with the concurrence of such
Lender, any other Lender, to the extent such Person is acting, in its capacity
as the issuer of Letters of Credit hereunder. 
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.


 


“JPMCB” has the meaning assigned to
such term in the recitals.


 


“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 by or on behalf of the Borrower at such
time.  The LC Exposure of any Lender at
any time shall be its pro rata (based on its Revolving Loan Commitment) share
of the total LC Exposure at such time.


 


“Lenders” means the Persons listed on Schedule
2.01 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.


 


“Letter of Credit” means any letter of
credit issued pursuant to this Agreement and shall include the Existing Letters
of Credit.


 


“LIBO Rate” means, with respect to any
Eurodollar Borrowing for any Interest Period, the rate appearing on Reuters
Screen LIBOR 01 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 Business Days prior to the commencement of such Interest
Period, as the rate of dollar deposits with the 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 Eurodollar 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 Business Days prior
to the commencement of such Interest Period.


 


11

















 


“Lien” means any interest in property
securing an obligation owed to, or a claim by, a Person other than the owner of
the property, whether such interest is based on the common law, statute or
contract, and including but not limited to the security interest lien arising
from a mortgage, encumbrance, pledge, conditional sale or trust receipt or a
lease, consignment or bailment for security purposes.  The term “Lien” shall include
reservations, exceptions, encroachments, easements, rights-of-way, covenants,
conditions, restrictions, leases and other title exceptions and encumbrances
(including, with respect to stock, stockholder agreements, voting trust
agreements, buy-back agreements and all similar arrangements) affecting
property.  For the purposes of this
Agreement, the Borrower or a Subsidiary shall be deemed to be the owner of any
property which it has acquired or holds subject to a conditional sale
agreement, Capital Lease or other arrangement pursuant to which title to the
property has been retained by or vested in some other Person for security
purposes and such retention or vesting shall constitute a Lien.


 


“Long-Term Lease” means any lease of
real or personal property (other than a Capital Lease) having an original term,
including any period for which the lease may be renewed or extended at the
option of the lessor, of more than three years.


 


“Loans” means the loans made by the
Lenders to the Borrower pursuant to this Agreement.


 


“Material Adverse Effect” means a
material adverse effect on (a) the business, assets, operations or
financial condition of the Borrower and its Subsidiaries taken as a whole, (b) the
ability of the Borrower or any Guarantor to perform any of its obligations
under this Agreement and the other Financing Documents, taken as a whole, (c) the
validity or enforceability of any of the Financing Documents, or (d) the
rights of or benefits available to the Lenders or the Administrative Agent
under this Agreement and the other Financing Documents, taken as a whole.


 


“Material Indebtedness” means
Indebtedness (other than the Loans), or obligations in respect of one or more
Swaps, of any one or more of the Borrower or any Restricted Subsidiary or
Guarantor in an aggregate principal amount exceeding $2,500,000.


 


“Maturity Date” means December 16,
2012.


 


“Member of the Zable Family” means
Walter J. Zable, his spouse, his children, his grandchildren and any trust of
which Walter J. Zable is the settlor.


 


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


 


“Note” means any of the promissory
notes executed pursuant to Section 2.09(e), as amended, modified,
supplemented, renewed or extended from time to time.


 


“Obligations” means all liabilities
and obligations of Borrower, whether now existing or hereafter incurred,
created or arising and whether direct or indirect, absolute or contingent, due
or to become due, arising out of or in connection with this Agreement,
including, without limitation, all principal of and interest on the Loans, all
fees, expenses, indemnities and other 


 


12

















 


amounts payable by the
Borrower under this Agreement or any other Financing Document (including
interest accruing after the filing of a petition or commencement of a case by
or with respect to the Borrower seeking relief under any applicable federal and
state laws pertaining to bankruptcy, reorganization, arrangement, moratorium,
readjustment of debts, dissolution, liquidation or other debtor relief,
specifically including, without limitation, the Bankruptcy Code and any
fraudulent transfer and fraudulent conveyance laws, whether or not the claim
for such interest is allowed in such proceeding).


 


“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.


 


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


 


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


 


“Permits” has the meaning assigned to
such term in Section 3.08(i) hereof.


 


“Permitted Acquisition”
means the acquisition of all or substantially all of the assets, all or a
substantial part of, a business, division, brand or product line, or all or
substantially all of the stock of any Person (such Person being the “Target”)
that is engaged in a line of business which is substantially related to that of
the Borrower and with respect to which:


 


(a)           such acquisition was approved by each
Person’s (including the Target’s) Board of Directors (or other similar
governing body);


 


(b)           at the time of such proposed acquisition
and immediately after giving effect thereto, no Default would exist;


 


(c)           at the time of such proposal
acquisition and immediately after giving effect thereto, the ratio of (i) Consolidated
Indebtedness to (ii) Consolidated Adjusted EBITDA, on a pro forma basis,
shall not be more than 2.50 to 1.00 (such compliance to be confirmed by an
officer’s certificate in a form satisfactory to the Administrative Agent); and


 


(d)           the Borrower shall have given the
Administrative Agent fifteen (15) days’ prior written notice, together with (i) all
instruments, documents, certificates, Lien searches, resolutions and opinions
(to the extent the Borrower receives (or provides) resolutions or opinions from
(or to) the applicable Target) delivered to or by the Borrower or a Restricted
Subsidiary and such other information which the Administrative Agent may
reasonably request in connection with any such proposed acquisition and (ii) if
the total consideration being paid (including, without limitation, assumed
Indebtedness or Preferred Stock) exceeds $20,000,000, financial statements, in
form and substance satisfactory to the Administrative Agent, for the applicable
Target.


 


13

















 


For purposes hereof, “pro forma basis” shall mean the
recalculation of the applicable financial covenants as if the proposed Target
(or the business related to the assets to be acquired from the proposed Target)
were consolidated with the Borrower for the twelve months immediately preceding
the date of such acquisition, with any Indebtedness of such acquired person
which is retired in connection with such acquisition to be excluded from such
calculations and deemed to have been retired as of the first day of such
applicable period, with income statement items and other balance sheet items
(whether positive or negative) attributable to such acquired person to be
included in such pro forma calculations to the extent relating to any such
applicable period and with such other adjustments as may be approved by the
Administrative Agent.


 


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


 


“Plan” means any employee pension
benefit plan (other than a Multiemployer Plan) subject to the provisions of
Title IV of ERISA or Section 412 of the Code or Section 302 of
ERISA, and in respect of which 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.


 


“Preferred Stock” means any class of
capital stock of a corporation that is preferred over any other class of
capital stock of such corporation as to the payment of dividends or the payment
of any amount upon liquidation or dissolution of such corporation.


 


“Prime Rate” means the rate of
interest per annum publicly announced from time to time by JPMorgan Chase Bank,
N.A. as its prime rate in effect at its principal office in New York City;
each change in the Prime Rate shall be effective from and including the date
such change is publicly announced as being effective.


 


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


 


“Regulation U” means
Regulation U of the Board, as the same is from time to time in effect, and
all official rulings and interpretations thereunder or thereof.


 


“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.


 


“Rentals” means and includes as of the
date of any determination thereof all fixed payments (including as such all
payments which the lessee is obligated to make to the lessor on termination of
the lease or surrender of the property) payable by the Borrower or a Restricted
Subsidiary, as lessee or sublessee under a lease of real or personal property,
but shall be exclusive of any amounts required to be paid by the Borrower or a
Restricted Subsidiary (whether or not designated as rents or additional rents)
on account of maintenance, repairs, insurance, taxes and similar charges.


 


“Required Lenders” means, at any time,
Lenders having Revolving Credit Exposure and unused Commitments representing at
least 51% of the sum of the total Revolving Credit 


 


14

















 


Exposures and unused
Commitments at such time, all after giving effect to the terms of Section 2.19(b).


 


“Responsible Officer” means any Senior
Financial Officer and any other officer of the Borrower with responsibility for
the administration of the relevant portion of this Agreement.


 


“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, or any
payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such Equity Interests or any
option, warrant or other right to acquire any such Equity Interests.


 


“Restricted Subsidiary” means any
Subsidiary (a) of which more than 80% (by number of votes) of the Equity
Interests with voting power is beneficially owned, directly or indirectly, by
the Borrower and (b) if applicable, as so designated within the
limitations of Section 6.07.


 


“Revolving Credit Commitment Fee” has
the meaning set forth in Section 2.11(a).


 


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


 


“Revolving Loan” means a Loan made
pursuant to Section 2.03.


 


“Revolving Loan Commitment” means,
with respect to each Lender, the commitment of such Lender to make Revolving
Loans and to acquire participations in Letters of Credit and Swingline Loans
hereunder, expressed as an amount representing the maximum aggregate amount of
such Lender’s Revolving Credit Exposure hereunder, as such commitment may be (a) increased
pursuant to Section 2.08(d), (b) reduced from time to time
pursuant to Section 2.08(b) and (c) 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
Loan Commitment is set forth on Schedule 2.01, or in the Assignment and
Assumption pursuant to which such Lender shall have assumed its Revolving Loan
Commitment, as applicable.  The initial
aggregate amount of the Lenders’ Revolving Loan Commitments is
$150,000,000.  Effective upon the
assignment of an interest pursuant to Section 9.04, Schedule
2.01 may be amended by the Administrative Agent to reflect such assignment.


 


“Sale and Leaseback Transaction” shall
have the meaning ascribed thereto in Section 6.04.


 


“SEC” is defined in Section 5.01(a);


 


“Securities Act” means the Securities
Act of 1933, as amended from time to time.


 


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


 


15
















 


“Senior Funded Debt” means all Funded
Debt of the Borrower which is not expressed to be subordinate or junior in rank
to any other Funded Debt of the Borrower.


 


“Senior Note Agreement” means the Note
Purchase Agreement dated as of November 1, 1998 between the Borrower and
the note purchasers described therein.


 


“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.  Eurodollar 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.


 


“Subsidiary” means, as to any Person,
any corporation, association or other business entity in which such Person or
one or more of its Subsidiaries or such Person and one or more of its Subsidiaries
owns sufficient equity or voting interests to enable it or them (as a group)
ordinarily, in the absence of contingencies, to elect a majority of the
directors (or Persons performing similar functions) of such entity, and any
partnership or joint venture if more than a 50% interest in the profits or
capital thereof is owned by such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries (unless such partnership can
and does ordinarily take major business actions without the prior approval of
such Person or one or more of its Subsidiaries).  Unless the context otherwise clearly
requires, any reference to a “Subsidiary” is a reference to a Subsidiary
of the Borrower.


 


“Swaps” means, with respect to any
Person, payment obligations with respect to interest rate swaps, currency swaps
and similar obligations obligating such Person to make payments, whether
periodically or upon the happening of a contingency; provided that Swaps
entered into by such Person in the ordinary course of business for the sole
purpose of managing or hedging risk shall not be deemed or construed to
constitute Indebtedness within the terms of this Agreement.  Without limiting the foregoing, the amount of
the obligation under any Swap shall be the amount determined in respect thereof
as of the end of the then most recently ended fiscal quarter of such Person,
based on the assumption that such Swap had terminated at the end of such fiscal
quarter, and in making such determination, if any agreement relating to such
Swap provides for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the simultaneous payment of
amounts by and to such Person, then in each such case, the amount of such
obligation shall be the net amount so determined.


 


“Swingline Exposure” means, at any
time, the aggregate principal amount of all Swingline Loans outstanding at such
time.  The Swingline Exposure of any
Lender at any time shall be its pro rata (based on its Revolving Loan Commitment)
share of the total Swingline Exposure at such time.


 


16

















 


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


 


“Swingline Loan” means a Loan made
pursuant to Section 2.04.


 


“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 of this Agreement, the borrowing of
Loans, the use of the proceeds thereof and the issuance of Letters of Credit
hereunder.


 


“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.


 


“Unrestricted Subsidiary” means any
Subsidiary which is not a Restricted Subsidiary and, if applicable, as has been
designated as such within the limitations of Section 6.07.


 


“Wholly-owned Restricted Subsidiary”
means, at any time, any Restricted Subsidiary one hundred percent (100%)
of all of the Equity Interests (except directors’ qualifying shares) and voting
interests of which are owned by any one or more of the Borrower and the
Borrower’s other Wholly-owned Restricted Subsidiaries at such time.


 


“Wholly-owned Subsidiary” means, at
any time, any Subsidiary one hundred percent (100%) of all of the Equity
Interests (except directors’ qualifying shares) and voting interests of which
are owned by any one or more of the Borrower and the Borrower’s other
Wholly-owned Subsidiaries at such time.


 


“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.


 


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


 


Section 1.03.          Terms
Generally.  The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined.  Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include”, “includes”
and “including” shall be deemed to be followed by the phrase “without
limitation”.  The word “will” shall be
construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or 


 


17

















 


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; GAAP.  Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower 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 GAAP 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 GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.  In calculating compliance with any of the
financial covenants (and related definitions), any amounts taken into account
in making such calculations that were paid, incurred or accrued in violation of
any provision of this Agreement shall be added back or deducted, as applicable,
in order to determine compliance with such covenants.


 


ARTICLE II


 


The Credits


 


Section 2.01.          Commitments.  Subject to the terms and conditions set forth
herein, each Lender agrees to make Revolving Loans to the Borrower from time to
time during the Availability Period in an aggregate principal amount that will
not result in such Lender’s Revolving Credit Exposure exceeding such Lender’s
Revolving Loan Commitment.  Subject to the
foregoing and within the foregoing limits, the Borrower may borrow, repay (or
prepay) and reborrow Revolving Loans, on and after the date hereof through the
Availability Period, subject to the terms, provisions and limitations set forth
herein, including, without limitation, the requirement that no Revolving Loan
shall be made hereunder if the amount thereof exceeds the Availability
outstanding at such time (in each case, after giving effect to the applications
of the proceeds of such Revolving Loan).


 


Section 2.02.          Loans
and Borrowings.  (a) Each Loan
shall be made as part of a Borrowing consisting of Revolving Loans made by the
Lenders ratably in accordance with their respective Revolving Loan
Commitments.  The failure of any Lender
to make any Loan required to be made by it shall not relieve any other Lender
of its obligations hereunder; provided that the Revolving Loan
Commitments of the Lenders are several and no Lender shall be responsible for
any other Lender’s failure to make Loans as required.


 


18

















 


(b)           Subject
to Sections 2.07(e) and 2.13, each Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
in accordance herewith.  Each Swingline
Loan shall be an ABR Loan.  Each Lender
at its option may make any Eurodollar Loan by causing any domestic or foreign
branch or Affiliate of such Lender to make such Loan; provided that any
exercise of such option shall not affect the obligation of the Borrower to
repay such Loan in accordance with the terms of this Agreement.


 


(c)           At
the commencement of each Interest Period for any Eurodollar Revolving
Borrowing, such Borrowing shall be in a minimum amount of $5,000,000 and an
aggregate amount that is an integral multiple of $100,000.  At the time that each ABR Revolving Borrowing
is made, such Borrowing shall be in an aggregate amount that is an integral
multiple of $100,000 and not less than $5,000,000; provided that an ABR
Revolving Borrowing may be in an aggregate amount that is equal to the entire
unused balance of the total Revolving Loan Commitments.  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 five (5) Eurodollar Revolving 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 Maturity Date.


 


Section 2.03.                             Requests for Borrowings. 
To request a Borrowing, the Borrower shall notify the Administrative
Agent of such request by writing, facsimile or telephone (a) in the case
of a Eurodollar Borrowing, not later than 1:00 pm, New York City
time, three Business Days before the date of the proposed Borrowing or (b) in
the case of an ABR Borrowing, not later than 1:00 pm
(or 10:00 am, if financing the reimbursement of an LC Disbursement as
contemplated by Section 2.05(e) hereof), New York City
time, on the same Business Day of the proposed Borrowing.  Each such Borrowing Request shall be
irrevocable and if given by telephone shall be confirmed promptly by writing or
fax to the Administrative Agent of a written Borrowing Request in a form
approved by the Administrative Agent and signed by an authorized signer of the
Borrower.  Each such telephonic and
written Borrowing Request shall specify the following information in compliance
with Section 2.02:


 


(a)           the
aggregate amount of the requested Borrowing;


 


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


 


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


 


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


 


(e)           the location and
number of the Borrower’s account to which funds are to be disbursed, which
shall comply with the requirements of Section 2.04.


 


19

















 


If no election as to the Type of Borrowing is
specified, then the requested Borrowing shall be an ABR Borrowing.  If no Interest Period is specified with
respect to any requested Eurodollar 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 applicable 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.                             Swingline Loans.  (a) Subject
to the terms and conditions set forth herein, the Swingline Lender agrees to
make Swingline Loans to the Borrower from time to time during the Availability
Period, in an aggregate principal amount at any time outstanding that will not
result in (i) the aggregate principal amount of outstanding Swingline
Loans exceeding $10,000,000 or (ii) Availability being less than zero; provided
that the Swingline Lender shall not be required to make a Swingline Loan to
refinance an outstanding Swingline Loan. 
Within the foregoing limits and subject to the terms and conditions set
forth herein, the Borrower may borrow, prepay and reborrow Swingline Loans.


 


(b)           To
request a Swingline Loan, the Borrower shall notify the Administrative Agent of
such request by telephone (confirmed by telecopy), not later
than 1:00 pm, New York City time, on the day of a proposed
Swingline Loan.  Each such notice shall
be irrevocable and shall specify the requested date (which shall be a Business
Day) and amount of the requested Swingline Loan.  The Administrative Agent will promptly advise
the Swingline Lender of any such notice received from the Borrower.  The Swingline Lender shall make each
Swingline Loan available to the Borrower by means of a credit to the general
deposit account of the Borrower with the Swingline Lender (or, in the case of a
Swingline Loan made to finance the reimbursement of an LC Disbursement as provided
in Section 2.05(e), by remittance to the Issuing Bank)
by 3:00 pm, New York City time, on the requested date of such
Swingline Loan.


 


(c)           The
Swingline Lender may by written notice given to the Administrative Agent not
later than 1:00 pm, New York City time, on any Business Day require
the Lenders to acquire participations on such Business Day in all or a portion
of the Swingline Loans outstanding.  Such
notice shall specify the aggregate amount of Swingline Loans in which Lenders
will participate.  Promptly upon receipt
of such notice, the Administrative Agent will give notice thereof to each
Lender, specifying in such notice such Lender’s pro rata (based on its
Revolving Loan Commitment) share of such Swingline Loan or Loans.  Each Lender hereby absolutely and
unconditionally agrees, upon receipt of notice as provided above, to pay to the
Administrative Agent, for the account of the Swingline Lender, such Lender’s
pro rata (based on its Revolving Credit Commitment) share of such Swingline
Loan or Loans.  Each Lender acknowledges
and agrees that its obligation to acquire participations in Swingline Loans
pursuant to this paragraph is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including 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.  Each Lender shall comply
with its obligation under this paragraph by wire transfer of immediately
available funds, in the same manner as provided in Section 2.06
with respect to Loans made by such Lender (and Section 2.06 shall
apply, mutatis mutandis, to the payment obligations of the
Lenders), and the Administrative Agent shall promptly pay to the Swingline
Lender the amounts so received by it from the Lenders.  The Administrative Agent shall notify the
Borrower of any participations in any


 


20

















 


Swingline Loan acquired pursuant to this paragraph,
and thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lender.  Any amounts received by the Swingline Lender
from the Borrower (or other party on behalf of the Borrower) in respect of a
Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale
of participations therein shall be promptly remitted to the Administrative
Agent; any such amounts received by the Administrative Agent shall be promptly
remitted by the Administrative Agent to the Lenders that shall have made their
payments pursuant to this paragraph and to the Swingline Lender, as their
interests may appear; provided that any such payment so remitted shall
be repaid to the Swingline Lender or to the Administrative Agent, as
applicable, if and to the extent such payment is required to be refunded to the
Borrower for any reason.  The purchase of
participations in a Swingline Loan pursuant to this paragraph shall not relieve
the Borrower of any default in the payment thereof.


 


Section 2.05.                             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 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.  All Existing
Letters of Credit shall be deemed to have been issued pursuant hereto, and from
and after the Effective Date shall be governed by the terms and conditions
hereof.


 


(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 telecopy (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 (reasonably in advance
of the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, and specifying the date of issuance,
amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with paragraph (c) of
this Section), the amount of such Letter of Credit, the name and address of the
beneficiary thereof and such other information as shall be necessary to
prepare, amend, renew or extend such Letter of Credit.  If requested by the 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 $150,000,000 and (ii) after giving effect to
the issuance, amendment, renewal or extension of such Letter of Credit,
Availability shall not be less than zero.


 


21

















 


(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 issuance of such Letter of Credit (or, in the case
of any renewal or extension thereof, one year after such renewal or extension);
provided that a Letter of Credit may provide that its expiration date
shall be automatically extended (but not beyond the date specified in clause (ii) below)
to a date not more than one year after the then outstanding expiration date
unless, at least a specified number of days prior to such then existing
expiration date, the Issuing Bank shall have given the beneficiary thereof
notice, in a form that may be specified in such Letter of Credit, that such
expiration date shall not be so extended, and (ii) the date that is five
days prior to the 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 Lenders, the Issuing Bank
hereby grants to each Lender, and each Lender hereby acquires from the Issuing
Bank, a participation in such Letter of Credit equal to such Lender’s pro rata
(based on its Revolving Loan Commitment) portion of the aggregate amount
available to be drawn under such Letter of Credit.  In consideration and in furtherance of the
foregoing, each Lender hereby absolutely and unconditionally agrees to pay to
the Administrative Agent, for the account of the Issuing Bank, such Lender’s
pro rata (based on its Revolving Credit Commitment) portion 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, or of any
reimbursement payment required to be refunded to the Borrower for any
reason.  Each 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 3:00 pm, New York City time, on the
date that such LC Disbursement is made, if the Borrower shall have received
notice of such LC Disbursement prior to 1:00 pm, New York City
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 2:00 pm,
New York City time, on (i) the Business Day that the Borrower
receives such notice, if such notice is received prior to 1:00 pm,
New York City 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 date 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 or 2.04 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 Lender of the
applicable LC Disbursement, the payment then due from the Borrower in respect
thereof and such Lender’s pro rata (based on its Revolving Loan Commitment)
portion thereof.  Promptly following receipt
of such notice, each Lender shall pay to the Administrative Agent its pro rata


 


22

















 


(based on its Revolving Credit Commitment) portion of
the payment then due from the Borrower, in the same manner as provided in Section 2.06
with respect to Loans made by such Lender (and Section 2.06 shall
apply, mutatis  mutandis, to the payment obligations of the
Lenders), and the Administrative Agent shall promptly pay to the Issuing Bank
the amounts so received by it from the 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 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 Lender pursuant to this
paragraph to reimburse the Issuing Bank for any LC Disbursement (other than the
funding of ABR Revolving Loans as contemplated above) shall not constitute a
Loan and shall not relieve the Borrower of its obligation to reimburse such LC
Disbursement.


 


(f)            Obligations
Absolute.  The Borrower’s obligation
to reimburse LC Disbursements as provided in paragraph (e) of this Section shall,
to the fullest extent permitted under applicable law, 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 (other than under circumstances which
constitute gross negligence or willful misconduct on the part of the Issuing
Bank as finally determined by a court of competent jurisdiction), (iii) payment
of 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
(other than under circumstances which constitute gross negligence or willful
misconduct on the part of the Issuing Bank as finally determined by a court of
competent jurisdiction), or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of,
or provide a right of setoff against, the Borrower’s obligations
hereunder.  Neither the Administrative
Agent, the 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 wilful 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
compliance with the terms of a Letter of Credit, the


 


23

















 


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 telecopy) 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 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,
then Section 2.12(c) 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 Lender pursuant to paragraph (c) of
this Section to reimburse the Issuing Bank shall be for the account of
such Lender to the extent of such payment.


 


Section 2.06.                             Funding of Borrowings.  (a) Each
Lender shall make each Loan to be made by it hereunder on the proposed date
thereof by wire transfer of immediately available funds by 2:00 pm,
New York City time, to the account of the Administrative Agent most
recently designated by it for such purpose by notice to the Lenders.  The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the amount so received, in like
funds, to an account maintained with Union Bank of California or such other
deposit taking financial institution as the Borrower may designate to the
Administrative Agent upon not less than three Business Days’ prior notice; provided
that Loans made to finance the reimbursement of an LC Disbursement as provided
in Section 2.05(e) shall be remitted by the Administrative
Agent to the Issuing Bank.


 


(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


 


24

















 


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 applicable to ABR Loans.  If such Lender pays such amount to the
Administrative Agent, then the Borrower shall be relieved of its obligation to
pay the corresponding amount to the Administrative Agent and such amount shall
constitute such Lender’s Loan included in such Borrowing.


 


Section 2.07.                             Interest Elections.  (a) Any
Borrowing on the Effective Date shall be at the Alternate Base Rate and
thereafter shall be of the Type specified in the applicable Borrowing Request
and, in the case of a Eurodollar Borrowing, shall have an initial Interest
Period as specified in such Borrowing Request. 
The Borrower may elect to convert such Borrowing to a different Type or
to continue such Borrowing and, in the case of a Eurodollar 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 in writing or by facsimile transmission
or by telephone (confirmed in writing or by fax) by the time that a Borrowing
Request would be required under Section 2.03 if the Borrower were
requesting a 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 telecopy 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 or a Eurodollar Borrowing; and


 


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


 


25
















 


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


 


Section 2.08.                             Termination, Reduction and Increase of
Commitments.  (a)  Unless previously terminated,
the Revolving Loan Commitments shall terminate on the Maturity Date.


 


(b)           The
Borrower may at any time terminate, or from time to time reduce, the Revolving
Loan Commitments; provided that each reduction of the Revolving Loan
Commitments shall be in an amount that is an integral multiple of $100,000 and
not less than $5,000,000.


 


(c)           The
Borrower shall notify the Administrative Agent of any election to terminate or
reduce the Revolving Loan Commitments under paragraph (b) of this Section at
least three Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective date thereof.  Promptly following receipt of any notice, the
Administrative Agent shall advise the applicable 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 Revolving Loan 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 or reduction of the Revolving Loan Commitments shall be
permanent.  Each reduction of the
Revolving Loan Commitments shall be made ratably among the Lenders with
Revolving Loan Commitments in accordance with their respective Revolving Loan
Commitments.


 


(d)           The
Borrower may at any time, by written notice to the Administrative Agent, and
with the consent of the Required Lenders, request that the Administrative Agent
increase the total Revolving Loan Commitments (a “Revolver Increase”) by
(i) adding one or more new lenders to the revolving credit facility under
this Agreement (each a “New Lender”) who wish to participate in such
Revolver Increase and/or (ii) increasing the Revolving Loan Commitments of
one or more Lenders party to this Agreement who wish to participate in such


 


26

















 


Revolver Increase; provided, however,
that (w) no Default or Event of Default shall have occurred and be
continuing as of the date of such request or as of the effective date of such
Revolver Increase (the “Increase Date”) or shall occur as a result
thereof, (x) any New Lender that becomes party to this Agreement pursuant
to this Section 2.08(d) shall satisfy the requirements of Section 9.04(b) hereof
and shall be acceptable to the Administrative Agent and consented to by the
Borrower and (y) the other conditions set forth in this Section 2.08(e) below
are satisfied.  The Administrative Agent
shall use commercially reasonable efforts to arrange for the syndication of any
Revolver Increase.  The Administrative
Agent shall promptly inform the Lenders of any such request made by the
Borrower.  The aggregate amount of
Revolver Increases shall not exceed $75,000,000 and no single such Revolver
Increase shall be for an amount less than $1,000,000.


 


(e)           On
each Increase Date, (i) each New Lender that has chosen to participate in
such Revolver Increase shall, subject to the conditions set forth in Section 2.08(d) hereof,
become a Lender party to this Agreement as of such Increase Date and shall have
a Revolving Loan Commitment in an amount equal to its share of the Revolver
Increase and (ii) each Lender that has chosen to increase its Commitment
pursuant to Section 2.08(d) will have its Revolving Loan
Commitment increased by the amount of its share of the Revolver Increase as of
such Increase Date; provided, however, that the Administrative
Agent shall have (y) received from the Borrower all out-of-pocket costs
and expenses incurred by the Administrative Agent or any Lender in connection
with such Revolver Increase and (z) received on or before such Increase
Date the following, each dated such date:


 


(i)            certified copies of resolutions of
the governing body of the Borrower approving the Revolver Increase and the
corresponding modifications, if any, to the Financing Documents required under
subclause (vi) below, together with a certificate of the Borrower
certifying that there have been no changes to the constitutive documents of the
Borrower since the Effective Date, or if there have been changes, copies
certified by the Borrower of all such changes;


 


(ii)           an assumption agreement from each New
Lender participating in the Revolver Increase, if any, in form and substance
satisfactory to the Administrative Agent (each, an “Assumption Agreement”),
duly executed by such New Lender, the Administrative Agent and the Borrower;


 


(iii)          confirmation from each Lender
participating in the Revolver Increase of the increase in the amount of its Revolving
Loan Commitment, in form and substance satisfactory to the Administrative
Agent;


 


(iv)          a certificate of the Borrower
certifying that no Default or Event of Default shall have occurred and be
continuing or shall occur as a result of such Revolver Increase;


 


(v)           a certificate of the Borrower
certifying that the representations and warranties made by the Borrower herein
and in the other Financing Documents are true and complete in all material
respects with the same force and effect as if made on and as of such date (or,
to the extent any such representation or warranty specifically relates to


 


27

















 


an earlier date, such
representation or warranty is true and complete in all material respects as of
such earlier date);


 


(vi)          supplements or modifications to the
Financing Documents and such additional Financing Documents, including any new
Notes to New Lenders and replacement Notes to Lenders that agree to participate
in such Revolver Increase, that the Administrative Agent reasonably deems
necessary in order to document such Revolver Increase and otherwise assure and
give effect to the rights of the Administrative Agent and the Lenders in the
Financing Documents; and


 


(vii)         such other documents, instruments and information
as the Administrative Agent or its counsel shall reasonably deem necessary in
connection with the Revolver Increase.


 


(f)            On
each Increase Date, upon fulfillment of the conditions set forth in Section 2.08(d),
the Administrative Agent shall (i) effect a settlement of all outstanding
Revolving Loans among the Lenders that will reflect the adjustments to the
Revolving Loan Commitments of the Lenders as a result of the Revolver Increase
and (ii) notify the Lenders, any New Lenders participating in the Revolver
Increase and the Borrower, on or before 1:00 p.m.  (New York City time), by telecopier or
telex, of the occurrence of the Revolver Increase to be effected on such
Increase Date.


 


Section 2.09.                             Repayment of Loans; Evidence of Debt.  (a) The
Borrower hereby unconditionally promises to pay (i) to the Administrative
Agent for the account of each Lender the then unpaid principal amount of each
Loan on the Maturity Date, and (ii) to the Swingline Lender the then
unpaid principal amount of each Swingline Loan on the earlier of the Maturity
Date and the first date after such Swingline Loan is made that is the 15th or
last day of a calendar month and is at least two Business Days after such
Swingline Loan is made; provided that on each date that a Revolving Loan
Borrowing is made, the Borrower shall repay all Swingline Loans then
outstanding.


 


(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 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


 


28

















 


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)           Unless
all Lenders otherwise agree, the Loans of each Lender shall be evidenced by a
promissory note substantially in the form of Exhibit C (each, a “Note”).  The Borrower shall execute and deliver to
each Lender a Note or Notes payable to the order of such Lender with blanks
completed to the satisfaction of such Lender.


 


Section 2.10.                             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, in integral multiples of $100,000 and not less
than $1,000,000, subject to prior notice in accordance with paragraph (b) of
this Section.


 


(b)           The
Borrower shall notify the Administrative Agent (and, in the case of prepayment
of a Swingline Loan, the Swingline Lender) by telephone (confirmed by telecopy)
of any prepayment hereunder (i) in the case of prepayment of a Eurodollar
Borrowing, not later than 1:00 pm, New York City time three Business
Days before the date of prepayment or (ii) in the case of prepayment of an
ABR Borrowing, not later than 1:00 pm, New York City time, one
Business Day before the date of prepayment. 
Each such notice shall be irrevocable and shall specify the prepayment
date and the principal amount of each Borrowing or portion thereof to be
prepaid; provided that, if a notice of prepayment is given under the
circumstances in which a conditional notice of termination of the Revolving
Loan Commitments is permitted as contemplated by Section 2.08, then
such notice of prepayment may be revoked if such notice of termination is
revoked in accordance with Section 2.08.  Promptly following receipt of any such notice
relating to a Borrowing, the Administrative Agent shall advise the applicable
Lenders of the contents thereof.  Each
partial prepayment of any Borrowing shall be in an amount that would be
permitted in the case of an advance of a Borrowing of the same Type as provided
in Section 2.02 (except that the foregoing shall not be applicable
to a prepayment in full of the aggregate principal amount of a Borrowing then
outstanding).  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 2.10.


 


Section 2.11.                             Fees.  (a) The
Borrower agrees to pay to the Administrative Agent for the account of each
Lender a commitment fee (the “Revolving Credit Commitment Fee”), which
shall accrue at the Applicable Rate on the daily amount of the unused Revolving
Loan Commitment of such Lender during the period from and including the
Effective Date to but excluding the date on which such Revolving Loan
Commitment terminates, whether or not prior to such time all the conditions in Section 4.02
are met.  Accrued Revolving Credit
Commitment Fees shall be payable quarterly in arrears on the fifth day of
January, April, July and October of each year and on the date on
which the Revolving Loan Commitments terminate, commencing on the first such date
to occur after the date hereof.  All
Revolving Credit Commitment Fees shall be computed on the basis of a year of
360 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day).


 


(b)           The
Borrower agrees to pay (i) to the Administrative Agent for the account of
each Lender a participation fee with respect to its participation in Letters of
Credit, which shall accrue for each day during the period from and including
the Effective Date to but


 


29

















 


excluding the later of the date on which such Lender’s
Revolving Loan Commitment terminates and the date on which such Lender ceases
to have any LC Exposure, at the Applicable Rate (or solely with respect to standby
Letters of Credit issued to secure Borrower’s performance obligations under
contracts entered into by the Borrower in the ordinary course of business,
seventy-five percent of such Applicable Rate) with respect to interest on
Eurodollar Revolving Loans for such day on the average daily amount of such
Lender’s LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) and (ii) to the Issuing Bank a fronting
fee, which shall accrue at a rate of 0.125% per annum on the average daily
amount of the LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date of termination of the
Revolving Loan Commitments and the date on which there ceases to be any LC
Exposure, as well as the Issuing Bank’s standard fees with respect to the
issuance, amendment, renewal or extension of any Letter of Credit or processing
of drawings thereunder.  Participation
fees and fronting fees accrued through and including the last day of January,
April, July and October of each year shall be payable on the fifth
day following such last day, commencing on the first such date to occur after
the Effective Date; provided that all such fees shall be payable on the
date on which the Revolving Loan Commitments terminate and any such fees
accruing after the date on which the Revolving Loan Commitments terminate shall
be payable on demand.  Any other fees payable
to the Issuing Bank pursuant to this paragraph shall be payable within 10 days
after demand.  All participation fees and
fronting fees shall be computed on the basis of a year of 360 days and shall be
payable for the actual number of days elapsed (including the first day but
excluding the last day).


 


(c)           The
Borrower agrees to pay to the Administrative Agent, for its own account, fees
in the amounts set forth in the Fee Letter and any other fees in the amounts
and at the times separately agreed upon in writing between the Borrower and the
Administrative Agent.


 


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


 


Section 2.12.                             Interest.  (a) The
Loans comprising each ABR Borrowing (including each Swingline Loan) shall bear interest
for each day on which any principal of such Loans remains outstanding at the
Alternate Base Rate for such day plus the Applicable Rate for such day.


 


(b)           The
Loans comprising each Eurodollar Borrowing shall bear interest for each day
during each Interest Period applicable thereto at the Adjusted LIBO Rate for
such Interest Period plus the Applicable Rate for such day.


 


(c)           Notwithstanding
the foregoing, if an Event of Default shall have occurred and be continuing
under subsections (a) or (b) of Article VII, then unless and
until such Event of Default shall have been cured or waived, all outstanding
amounts which are then due and owing shall bear interest, after as well as
before judgment, at a rate per annum equal to 2% plus the rate otherwise applicable
to ABR Loans as provided for in subsection (a) above.


 


30

















 


(d)           Accrued
interest on each Loan shall be payable in arrears on each Interest Payment Date
for such Loan, on the Maturity Date and, upon termination of the Revolving Loan
Commitments; provided that (i) interest accrued pursuant to
paragraph (c) of this Section shall be payable on demand, (ii) in
the event of any repayment or prepayment of any Eurodollar Loan, accrued
interest on the principal amount repaid or prepaid shall be payable on the date
of such repayment or prepayment and (iii) in the event of any conversion
of any Eurodollar Loan prior to the end of the current Interest Period
therefor, accrued interest on such Eurodollar Loan shall be payable on the
effective date of such conversion.


 


(e)           All
interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the Alternate Base Rate 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 in a leap year), and in each
case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). 
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 2.13.                             Alternate Rate of Interest. 
If prior to the commencement of any Interest Period for a Eurodollar Borrowing:


 


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


 


(b)           the Administrative
Agent is advised by the Required Lenders that the Adjusted LIBO Rate, for such
Interest Period will not adequately and fairly reflect the cost to such Lenders
of making or maintaining their Loans 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 telecopy, 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
Eurodollar Borrowing shall be ineffective and (ii) if any Borrowing
Request or Interest Election Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.


 


Section 2.14.                             Increased Costs.  (a) If
any Change in Law shall:


 


(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


 


(ii)           impose on any Lender or the London
interbank market any other condition affecting this Agreement or Eurodollar
Loans made by such Lender or any Letter of Credit or participation therein;


 


31

















 


and the result of any of the foregoing shall be to
increase the cost to such Lender of making or maintaining any Eurodollar Loan
(or of maintaining its obligation to make any such Eurodollar 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) with respect to its Eurodollar Loans, 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 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 in reasonable detail
the calculation of 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 on demand.


 


(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 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 2.15.                             Break Funding Payments. 
In the event of (a) the payment of any principal of any Eurodollar
Loan other than on the last day of an Interest Period applicable thereto
(including as a result of an Event of Default), (b) the conversion of any Eurodollar
Loan other than on the last day of the Interest Period applicable thereto or (c) the
failure to borrow, convert, continue or prepay any Eurodollar Loan on the date
specified in any notice delivered pursuant hereto (regardless of whether such
notice may be revoked under Section 2.08(b) and is revoked in
accordance therewith), then, in any such event, the Borrower shall compensate
each Lender


 


32

















 


for
the loss, cost and expense attributable to such event.  In the case of a Eurodollar Loan, such loss,
cost or expense to any Lender shall be deemed to include an amount determined
by such Lender to be the excess, if any, of (i) the amount of interest
which would have accrued on the principal amount of such Loan had such event
not occurred, at 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.  A certificate of any Lender setting forth in
reasonable detail 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 2.16.                             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 or Lender (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 and each Lender, within 10
days after written demand therefor, for the full amount of any Indemnified
Taxes or Other Taxes paid by the Administrative Agent or such Lender, 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 by
the Administrative Agent on its own behalf or on behalf of a Lender, shall be
conclusive absent manifest error.


 


(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


 


33

















 


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 Section 2.16, 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 2.16 with respect
to the Taxes or Other Taxes giving rise 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 that 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 other information relating to its taxes which it deems
confidential) to the Borrower or any other Person.


 


Section 2.17.         Payments
Generally; Pro Rata Treatment; 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 2.14,
2.15 or 2.16, or otherwise) prior to 1:00 pm, New York
City 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.  The Administrative Agent may charge, when due
and payable, the Borrower’s account with the Administrative Agent for all
interest, principal and Revolving Credit Commitment Fees or other fees owing to
the Administrative Agent or the Lenders on or with respect to this Agreement
and/or Loans and other Financing Documents. 
All such payments shall be made to the Administrative Agent at its
offices at 1411 Broadway, New York, New York, except that payments
pursuant to Sections 2.14, 2.15, 2.16 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; provided
that, in the case of any prepayment of principal of or interest on any
Eurodollar Loan, if such next succeeding Business Day would fall in the next
calendar month, the date for payment shall instead be the next preceding
Business Day.  All payments hereunder
shall be made in dollars.


 


(b)           If
at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, unreimbursed LC
Disbursements, interest and fees then due hereunder, such funds shall be
applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second,
towards payment


 


34

















 


of principal and unreimbursed LC Disbursements then
due hereunder, ratably among the parties entitled thereto in accordance with
the amounts of principal and unreimbursed LC Disbursements then due to such
parties.


 


(c)           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 Revolving Loans or participations in LC Disbursements or Swingline Loans
resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Revolving Loans and participations in LC Disbursements
and Swingline Loans 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 Revolving Loans and
participations in LC Disbursements and Swingline Loans 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 Revolving Loans in participations in LC
Disbursements and Swingline Loans; 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.


 


(d)           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 the 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.


 


(e)           If
any Lender shall fail to make any payment required to be made by it pursuant to
Section 2.04 (c), Section 2.05(d) or (e), Section 2.06(b),
Section 2.17(c) or Section 9.03, then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), (i) apply any amounts thereafter received by the
Administrative Agent for the account of such Lender and for the benefit of the
Administrative Agent, the Swingline Lender or


 


35
















 


the Issuing Bank to satisfy such Lender’s obligations
under such Sections until all such unsatisfied obligations are fully paid,
and/or (ii) hold any such amounts in a segregated account as cash
collateral for, and application to, any future funding obligations of such
Lender under such Sections; in the case of each of (i) and (ii) above,
in any order as determined by the Administrative Agent in its discretion.


 


Section 2.18.                             Mitigation Obligations.


 


(a)           If
any Lender requests compensation under Section 2.14, 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 2.16,
then such Lender shall use reasonable efforts to designate a different lending
office for funding or booking its Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if, in
the judgment of such Lender, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 2.14 or 2.16,
as the case may be, in the future and (ii) would not subject such Lender
to any unreimbursed cost or expense and would not otherwise be disadvantageous
to such Lender.  The Borrower hereby
agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.


 


(b)           If
any Lender requests compensation under Section 2.14, 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 2.16,
or if any Lender becomes a Defaulting Lender, then the Borrower may, at its
sole expense and effort, upon notice to such Lender and the Administrative
Agent, require such Lender to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in Section 9.04),
all its interests, rights and obligations under this Agreement to an assignee
that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment); provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent (and
if a Commitment is being assigned, the Issuing Bank), which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of
an amount equal to the outstanding principal of its Loans and participations in
LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder, from the assignee (to the extent
of such outstanding principal and accrued interest and fees) or the 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 2.14
or payments required to be made pursuant to Section 2.16, such
assignment will result in a reduction in such compensation or payments and (iv) such
assignment does not conflict with applicable law.  A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.


 


Section 2.19.                             Defaulting Lenders.


 


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


 


36

















 


(a)           fees
shall cease to accrue on the unfunded portion of the Commitment of such
Defaulting Lender pursuant to Section 2.11(a);


 


(b)           the
Commitment and Revolving Credit Exposure of such Defaulting Lender shall not be
included in determining whether all Lenders or the Required Lenders have taken
or may take any action hereunder (including any consent to any amendment or
waiver pursuant to Section 9.02), provided that any waiver,
amendment or modification requiring the consent of all Lenders or each affected
Lender which affects such Defaulting Lender differently than other affected
Lenders shall require the consent of such Defaulting Lender;


 


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


 


(i)            all or any part of such Swingline
Exposure and LC Exposure shall be reallocated among the non-Defaulting Lenders
in accordance with their respective pro rata shares (based on their respective
Revolving Loan Commitments) but only to the extent (x) the sum of all
non-Defaulting Lenders’ Revolving Credit Exposures plus such Defaulting Lender’s
Swingline Exposure and LC Exposure does not exceed the total of all
non-Defaulting Lenders’ Commitments and (y) the conditions set forth in Section 4.02
are satisfied at such time; and


 


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


 


(iii)          if the Borrower cash collateralizes
any portion of such Defaulting Lender’s LC Exposure pursuant to Section 2.19(c),
the Borrower shall not be required to pay any fees to such Defaulting Lender
pursuant to Section 2.11(b) with respect to such Defaulting
Lender’s LC Exposure during the period such Defaulting Lender’s LC Exposure is
cash collateralized;


 


(iv)          if the LC Exposure of the
non-Defaulting Lenders is reallocated pursuant to Section 2.19(c),
then the fees payable to the Lenders pursuant to Section 2.11(a) and
Section 2.11(b) shall be adjusted in accordance with such
non-Defaulting Lenders’ pro rata shares (based on their respective Revolving
Loan Commitments); or


 


(v)           if any Defaulting Lender’s LC
Exposure is neither cash collateralized nor reallocated pursuant to Section 2.19(c),
then, without prejudice to any rights or remedies of the Issuing Bank or any
Lender hereunder, all letter of credit fees payable under Section 2.11(b) with
respect to such Defaulting Lender’s LC Exposure shall be payable to the Issuing
Bank until such LC Exposure is cash collateralized and/or reallocated; and


 


(d)           so
long as any Lender is a Defaulting Lender, the Swingline Lender shall not be
required to fund any Swingline Loan and the Issuing Bank shall not be required
to issue,


 


37

















 


amend or increase any Letter of Credit, unless it is
satisfied that the related exposure will be 100% covered by the Commitments of
the non-Defaulting Lenders and/or cash collateral will be provided by the
Borrower in accordance with Section 2.19(c), and participating
interests in any such newly issued or increased Letter of Credit or newly made
Swingline Loan shall be allocated among non-Defaulting Lenders in a manner
consistent with Section 2.19(c)(i) (and Defaulting Lenders
shall not participate therein).


 


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


 


ARTICLE III




Representations
and Warranties


 


The Borrower represents and
warrants to the Lenders that:


 


Section 3.01.         Existence
and Power.  Each of the Borrower and
its Restricted Subsidiaries is a corporation organized, validly existing and in
good standing under the laws of its jurisdiction, and has all necessary powers
required to carry on its business as now conducted and, except where the
failure to do so could not be reasonably expected to result in a Material
Adverse Effect, is qualified to do business in, and is in good standing in,
every jurisdiction where such qualification is required.


 


Section 3.02.         Corporate
and Governmental Authorization; No Contravention.  The execution, delivery and performance by
the Borrower of the Financing Documents to which it is a party are within its
corporate powers, have been duly authorized by all necessary corporate action,
require no action by or in respect of, or filing with, any Governmental
Authority and do not contravene, or constitute a default under, any provision
of material applicable law or material regulation or of its charter or bylaws
or of any material agreement, judgment, injunction, order, decree or other
material instrument binding upon each or result in the creation or imposition
of any Lien on any material asset of the Borrower or any of its Restricted
Subsidiaries.


 


Section 3.03.         Binding
Effect.  This Agreement and the other
Financing Documents to which it is a party constitute valid and binding
agreements of the Borrower, in each case enforceable in accordance with their
respective terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization or moratorium or other similar laws
relating to the enforcement of creditors’ rights generally and by general
equitable principles.


 


Section 3.04.         Financial
Information.  (a) The Borrower
has heretofore furnished to the Administrative Agent financial statements of
the Borrower (i) for the fiscal years ended September 30, 2007 and September 30,
2008 audited by Ernst & Young LLP, independent public


 


38

















 


accountants
and (ii) for the fiscal quarters ended December 31, 2008, March 31,
2009 and June 30, 2009, which quarterly financial statements were
unaudited.  Such financial statements
present fairly in all material respects the financial condition and results of
operations of the Borrower and its Subsidiaries as of the dates and for the
periods indicated, and such financial statements disclose in accordance with
GAAP all material liabilities, direct or contingent, of the Borrower as of the
dates thereof.


 


(b)                                 Since September 30, 2008, there has
been no material adverse change in the business, prospects, assets, operations
or financial condition of the Borrower and its Restricted Subsidiaries,
considered as a whole.


 


Section 3.05.         Litigation.  Except for the Disclosed Matters, there is no
action, suit or proceeding pending against, or to the knowledge of the Borrower
threatened against or affecting, the Borrower or any of its Restricted
Subsidiaries before any arbitrator or any Governmental Authority, that (i) could
reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect, or (ii) which would in any material respect draw
into question the enforceability of any of the Financing Documents.


 


Section 3.06.         Compliance
with ERISA.  Each of the Borrower and
its Restricted Subsidiaries and each ERISA Affiliate has fulfilled its
obligations under the minimum funding standards of ERISA and the Internal
Revenue Code with respect to each Plan and is in compliance in all material
respects with the presently applicable provisions of ERISA and the Code with
respect to each Plan, and has not incurred any liability under Title IV of
ERISA (i) to the PBGC other than a liability to the PBGC for premiums
under Section 4007 of ERISA or (ii) in respect of a Multiemployer
Plan which has not been discharged in full when due.


 


Section 3.07.         Taxes.  To the extent applicable, each of the
Borrower and its Restricted Subsidiaries has filed all United States Federal
income tax returns and all other material tax returns which are required to be
filed by it and has paid all taxes stated to be due in such returns or pursuant
to any assessment received by it, except for taxes the amount, applicability or
validity of which is being contested in good faith by appropriate
proceedings.  The charges, accruals and
reserves on the books of the Borrower and its Restricted Subsidiaries in
respect of taxes or other similar governmental charges, additions to taxes and
any penalties and interest thereon are, in the opinion of the Borrower,
adequate.


 


Section 3.08.         Environmental Compliance.  (a) Except for Disclosed Matters,


 


(i)            the Borrower and its Restricted
Subsidiaries have, obtained, or made timely application for, all permits,
certificates, licenses, approvals, registrations and other authorizations
(collectively “Permits”) which are required under all applicable
Environmental Laws and are necessary for their operations and are in compliance
with the terms and conditions of all such Permits, except where the failure to
obtain such Permits or to comply with their terms would not have, individually
or in the aggregate, a Material Adverse Effect;


 


(ii)           no notice, notification, demand,
request for information, citation, summons, complaint or order has been issued,
no complaint has been filed, no penalty


 


39

















 


has been assessed and no
investigation or review is pending, or to the Borrower’s knowledge, threatened
by any governmental entity or other Person with respect to any (A) alleged
violation by the Borrower or any Restricted Subsidiary of any Environmental
Law, (B) alleged failure by the Borrower or any Restricted Subsidiary to
have any Permits required in connection with the conduct of its business or to
comply with the terms and conditions thereof, (C) any generation,
treatment, storage, recycling, transportation or disposal of any Hazardous
Materials or (D) release of Hazardous Materials, except where such event
or events would not have, individually or in the aggregate, a Material Adverse
Effect;


 


(iii)          to the knowledge of the Borrower, all
oral or written notifications of a release of Hazardous Materials required to
be filed under any applicable Environmental Law have been filed or are in the
process of being filed by or on behalf of the Borrower or any Restricted
Subsidiary;


 


(iv)          no property now owned or leased by the
Borrower or any Restricted Subsidiary and, to the knowledge of the Borrower, no
such property previously owned or leased or any property to which the Borrower
or any Restricted Subsidiary has, directly or indirectly, transported or
arranged for the transportation of any Hazardous Materials, is listed or, to
the Borrower’s knowledge, proposed for listing, on the National Priorities List
promulgated pursuant to CERCLA, or CERCLIS (as defined in CERCLA) or any
similar state list or is the subject of federal, state or local enforcement
actions or, to the knowledge of the Borrower, other investigations which may
lead to claims against the Borrower or any Restricted Subsidiary for clean-up
costs, remedial work, damage to natural resources or personal injury claims,
including, but not limited to, claims under CERCLA, except where such listings
or investigations would not have, individually or in the aggregate, a Material
Adverse Effect;


 


(v)           there are no Liens under or pursuant
to any applicable Environmental Laws on any real property or other assets owned
or leased by the Borrower or any Restricted Subsidiary, and no government
actions have been taken or, to the knowledge of the Borrower, are in process
which could subject any of such properties or assets to such Liens.


 


(b)           For
purposes of this Section, the terms “Borrower” and “Restricted Subsidiary”
shall include any business or business entity (including a corporation) which
is a predecessor, in whole or in part, of the Borrower or any Restricted
Subsidiary.


 


Section 3.09.         Properties.  (a) Each of the Borrower and its
Restricted Subsidiaries has good title to, or valid leasehold interests in, all
its real and personal property material to its business, except for minor
defects in title that do not interfere with its ability to conduct its business
as currently conducted or to utilize such properties for their intended
purposes.


 


(b)           To
the knowledge of the Borrower, each of the Borrower and its Restricted
Subsidiaries owns, or is licensed to use, all trademarks, trade names,
copyrights, patents and other intellectual property material to its business,
and the use thereof by the Borrower and its Restricted Subsidiaries does not,
to the knowledge of the Borrower, infringe


 


40

















 


upon the rights of any other Person, except for any
such infringements that, individually or in the aggregate, could not reasonably
be expected to result in a Material Adverse Effect.


 


Section 3.10.         Compliance
with Laws and Agreements.  Each of
the Borrower and its Restricted Subsidiaries is in compliance with all laws,
regulations and orders of any Governmental Authority applicable to it or its
property and all indentures, agreements and other instruments binding upon it
or its property, and each has all material governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted, 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 3.11.         Investment
and Holding Company Status.  Neither
the Borrower nor any of its Restricted Subsidiaries is (a) an “investment
company” as defined in, or subject to regulation under, the Investment Company
Act of 1940 or (b) a “holding company” as defined in, or subject to
regulation under, the Public Utility Holding Company Act of 1935.


 


Section 3.12.         Full
Disclosure.  All information
furnished by the Borrower to the Administrative Agent or any Lender for
purposes of or in connection with this Agreement or any of the Transactions is,
taken as whole and in light of the circumstances under which such information
is furnished, true and accurate in all material respects on the date as of
which such information is furnished, and true and accurate in all material
respects on the date as of which such information is stated or certified.  It is understood that the foregoing is
limited to the extent that (i) projections have been made in good faith by
the management of the Borrower and in the view of the Borrower’s management are
reasonable in light of all information known to management as of the Effective
Date, and (ii) no representation or warranty is made as to whether the
projected results will be realized.


 


Section 3.13.         Solvency.  (a) The fair salable value of the
business of the Borrower and its Restricted Subsidiaries is not less than the
amount that will be required to be paid on or in respect of the probable
liability on the existing debts and other liabilities (including contingent
liabilities) of the Borrower and its Restricted Subsidiaries, as they become
absolute and mature.


 


(b)           The
assets of the Borrower and its Restricted Subsidiaries do not constitute
unreasonably small capital for the Borrower and its Restricted Subsidiaries to
carry out their business as now conducted and as proposed to be conducted
including the capital needs of the Borrower and its Restricted Subsidiaries,
taking into account the particular capital requirements of the business
conducted by the Borrower and its Restricted Subsidiaries and projected capital
requirements and capital availability thereof.


 


(c)           Neither
the Borrower nor any of its Restricted Subsidiaries intends to incur debts
beyond its ability to pay such debts as they mature (taking into account the
timing and amounts of cash to be received by the Borrower and any of its
Restricted Subsidiaries, and of amounts to be payable on or in respect of debt
of the Borrower and any of its Restricted Subsidiaries).


 


(d)           Neither
the Borrower nor any of its Restricted Subsidiaries believes that final
judgments against them in actions for money damages presently pending will be
rendered at


 


41

















 


a time when, or in an amount such that, they will be
unable to satisfy any such judgments promptly in accordance with their terms
(taking into account the maximum reasonable amount of such judgments in any
such actions and the earliest reasonable time at which such judgments might be
rendered).  The cash flow of the Borrower
and its Restricted Subsidiaries, after taking into account all other
anticipated uses of the cash of the Borrower and its Restricted Subsidiaries
(including the payments on or in respect of debt referred to in paragraph (c) of
this Section), will at all times be sufficient to pay all such judgments
promptly in accordance with their terms.


 


Section 3.14.         Employee
Matters.  Except for Disclosed
Matters, there are no strikes, slowdowns, work stoppages or controversies
pending or, to the knowledge of the Borrower threatened between the Borrower
and its employees, other than employee grievances arising in the ordinary
course of business, none of which could have, either individually or in the
aggregate, a Material Adverse Effect.


 


Section 3.15.         Use
of Proceeds.  All proceeds of each
Borrowing under the Revolving Loan Commitments shall be used to repay existing
Indebtedness, make Permitted Acquisitions, and provide for working capital
requirements and general corporate purposes and none of such proceeds will be
used, directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of buying or carrying any “margin stock” within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System, as
the same is from time to time in effect..


 


Section 3.16.         Subsidiaries.  As of the Effective Date, the Borrower has
the Restricted Subsidiaries set forth on Schedule 3.16A and the
Unrestricted Subsidiaries set forth on Schedule 3.16B.


 


Section 3.17.         No
Change in Credit Criteria or Collection Policies.  There has been no material change in credit
criteria or collection policies concerning accounts receivable of the Borrower
and its Subsidiaries since September 30, 2008.


 


ARTICLE IV




Conditions


 


Section 4.01.         Effective
Date.  The obligations of the Lenders
to make Loans hereunder and of the Issuing Bank to issue Letters of Credit
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)           The Administrative
Agent (or its counsel) shall have received from each party hereto either (i) a
counterpart of this Agreement signed on behalf of such party or (ii) written
evidence satisfactory to the Administrative Agent (which may include telecopy
transmission of a signed signature page of this Agreement) that such party
has signed a counterpart of this Agreement.


 


(b)           The Administrative
Agent shall have received a favorable written opinion (addressed to the
Administrative Agent and the Lenders and dated the Effective Date) of William
L. Hoese, Assistant General Counsel of the Borrower, substantially in the form
of Exhibit B, and covering such other matters relating to the Borrower,
this


 


42

















 


Agreement or the
Transactions as the Required Lenders shall reasonably request.  The Borrower hereby requests such counsel to
deliver such opinion.


 


(c)           The Administrative
Agent shall have received such documents and certificates as the Administrative
Agent or its counsel may reasonably request relating to the organization,
existence and good standing of the Borrower and any Guarantors, the
authorization of the Transactions and any other legal matters relating to the
Borrower and any Guarantors, this Agreement or the Transactions (including,
without limitation, confirmation that all third party and governmental
approvals necessary for the Transaction have been obtained and are in force),
all in form and substance reasonably satisfactory to the Administrative Agent
and its counsel.


 


(d)           The Administrative
Agent shall have received a certificate of the Borrower, dated the Effective
Date and signed by the President, a Vice President or a Financial Officer of
the Borrower, confirming compliance with the conditions set forth in paragraphs
(a) and (b) of Section 4.02.


 


(e)           The Administrative
Agent shall have received all fees and other amounts due and payable, on or
prior to the Effective Date, including, to the extent invoiced, reimbursement
or payment of all out-of-pocket expenses required to be reimbursed or paid by
the Borrower hereunder.


 


(f)            The Administrative
Agent (or its counsel) shall have received the other Financing Documents, all
in form and substance reasonably satisfactory to the Administrative Agent and
its counsel.


 


(g)           The Administrative
Agent shall have received and determined to be in form and substance
satisfactory to it:


 


(i)            evidence
of the compliance by the Borrower with Section 5.06 hereof;


 


(ii)           the
financial statements described in Section 3.04 hereof.


 


(h)           The Borrower shall
have executed and delivered to the Administrative Agent a disbursement
authorization letter with respect to the disbursement of the proceeds of the
Loans made on the Effective Date.


 


(i)            The Administrative
Agent shall have received (x) evidence of the repayment in full of the
existing credit arrangements under the Existing Credit Agreement and the
termination of all commitments to lend thereunder and (y) such other
documents, and completed such other reviews, including, without limitation,
material leases and contracts, litigation and taxes, as the Administrative
Agent or its counsel shall reasonably deem necessary.


 


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 hereunder shall not become effective
unless each of the foregoing


 


43

















 


conditions is satisfied (or waived pursuant to Section 9.02)
at or prior to 3:00 pm, New York City time, on December 31, 2009
(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 any
Lender to make a Loan on the occasion of any Borrowing, is subject to the
satisfaction on such date of the following conditions:


 


(a)           The representations
and warranties of the Borrower set forth in this Agreement shall be true and
correct on and as of the date of such Borrowing; provided that any such
representations and warranties that by their express terms are made as of a
specific date shall be true and correct as of such specific date.


 


(b)           At the time of and
immediately after giving effect to such Borrowing, no Default shall have
occurred and be continuing.


 


Each Borrowing shall be deemed to constitute a
representation and warranty by the Borrower on the date thereof as to the
matters specified in paragraphs (a) and (b) of this Section.


 


ARTICLE V


 


Affirmative Covenants


 


Until the Commitments have expired or been
terminated and the principal of and interest on each Loan and all fees and
other Obligations payable hereunder have been paid in full, and all Letters of
Credit shall have expired or terminated and all LC Disbursements shall have
been reimbursed, the Borrower covenants and agrees with the Lenders that:


 


Section 5.01.         Financial
and Business Information.  The
Borrower shall deliver to the Administrative Agent and each Lender:


 


(a)           Quarterly
Statements — within 60 days after the end of each quarterly fiscal period
in each fiscal year of the Borrower (other than the last quarterly fiscal
period of each such fiscal year), duplicate copies of:


 


(i)            a consolidated balance sheet of the
Borrower and its Restricted Subsidiaries as at the end of such quarter, and


 


(ii)           consolidated statements of income,
changes in shareholders’ equity and cash flows of the Borrower and its
Restricted Subsidiaries for such quarter and (in the case of the second and
third quarters) for the portion of the fiscal year ending with such quarter,


 


setting forth in each case in comparative form the
figures for the corresponding periods in the previous fiscal year, all in
reasonable detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally, and certified by a Senior Financial Officer as
fairly presenting, in all material respects, the financial position of the companies
being reported on and


 


44

















 


their results of operations and cash flows, subject
to changes resulting from year-end adjustments; provided that if the
Borrower’s Quarterly Report on Form 10-Q prepared in compliance with the
requirements therefor and filed with the Securities and Exchange Commission (“SEC”)
is required to be delivered within a shorter time period, then the Borrower’s
compliance with the requirements of this Section 5.01(a) must
be satisfied by complying with such shorter time period (subject always to the
Borrower’s compliance with Section 5.04);


 


(b)           Annual Statements — within 120
days after the end of each fiscal year of the Borrower, commencing with the
fiscal year ending September 30, 2009, duplicate copies of,


 


(i)            a consolidated balance sheet of the
Borrower and its Restricted Subsidiaries, as at the end of such year, and


 


(ii)           consolidated statements of income,
changes in shareholders’ equity and cash flows of the Borrower and its
Restricted Subsidiaries, for such year,


 


setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP, and accompanied by:


 


(1)           an unqualified
opinion thereon of independent certified public accountants of recognized
national standing, which opinion shall state that such financial statements
present fairly, in all material respects, the financial position of the
companies being reported upon and their results of operations and cash flows
and have been prepared in conformity with GAAP, and that the examination of
such accountants in connection with such financial statements has been made in
accordance with generally accepted auditing standards, and that such audit
provides a reasonable basis for such opinion in the circumstances, and


 


(2)           a certificate of
such accountants stating that they have reviewed this Agreement and stating
further whether, in making their audit, they have become aware of any condition
or event that then constitutes a Default, and, if they are aware that any such
condition or event then exists, specifying the nature and period of the
existence thereof (it being understood that such accountants shall not be
liable, directly or indirectly, for any failure to obtain knowledge of any
Default unless such accountants should have obtained knowledge thereof in
making an audit in accordance with generally accepted auditing standards or did
not make such an audit),


 


provided that if the Borrower’s
Annual Report on Form 10-K for such fiscal year (together with the
Borrower’s annual report to shareholders, if any, prepared pursuant to Rule 14a-3
under the Exchange Act) prepared in accordance with the requirements therefor
and filed with the SEC is required to be delivered within a shorter time
period, then the Borrower’s compliance with the requirements of this Section 5.01(b) (other
than the accountant’s certificate described in clause (2) above which
may be delivered within said 120-day period), must be satisfied by complying
with such shorter time period (subject to the Borrower’s compliance with Section 5.04);


 


45
















 


(c)           SEC
and Other Reports — promptly upon their becoming available, one copy of (i) each
financial statement, report, notice or proxy statement sent by the Borrower or
any Subsidiary to public securities holders generally, and (ii) each
regular or periodic report (other than Form 8K so long as such Form may
be accessed on-line and Borrower has notified the Administrative Agent that
such form has been filed), each registration statement (without exhibits except
as expressly requested by a Lender), and each prospectus and all amendments
thereto filed by the Borrower or any Subsidiary with the SEC;


 


(d)           Notice
of Default or Event of Default — promptly, and in any event within five
Business Days after a Responsible Officer becoming aware of the existence of
any Default or that any Person has given any notice or taken any action with
respect to a claimed default hereunder or that any Person has given any notice
or taken any action with respect to a claimed default or that any Person has
given any notice or taken any action with respect to a claimed default of the
type referred to in subparagraph (f) of Article VII, a written
notice specifying the nature and period of existence thereof and what action
the Borrower is taking or proposes to take with respect thereto;


 


(e)           ERISA
Matters — promptly, and in any event within five Business Days after a
Responsible Officer becoming aware of any of the following, a written notice
setting forth the nature thereof and the action, if any, that the Borrower or
an ERISA Affiliate proposes to take with respect thereto:


 


(i)            with respect to any
Plan, any reportable event, as defined in Section 4043(b) of ERISA
and the regulations thereunder, for which notice thereof has not been waived
pursuant to such regulations as in effect on the date hereof; or


 


(ii)           the taking by the PBGC of steps to
institute, or the threatening by the PBGC of the institution of, proceedings
under Section 4042 of ERISA for the termination of, or the appointment of
a trustee to administer, any Plan, or the receipt by the Borrower or any ERISA
Affiliate of a notice from a Multiemployer Plan that such action has been taken
by the PBGC with respect to such Multiemployer Plan; or


 


(iii)          any ERISA Event or any event,
transaction or condition that could result in the incurrence of any liability
by the Borrower or any ERISA Affiliate pursuant to Title I or IV of
ERISA or the penalty or excise tax provisions of the Code relating to employee
benefit plans, or in the imposition of any Lien on any of the rights,
properties or assets of the Borrower or any ERISA Affiliate pursuant to
Title I or IV of ERISA or such penalty or excise tax provisions, if
such liability or Lien, taken together with any other such liabilities or Liens
then existing, could reasonably be expected to have a Material Adverse Effect;


 


(f)            Notices
from Governmental Authority — promptly, and in any event within 30 days of
receipt thereof, copies of any notice to the Borrower or any Subsidiary from
any Federal, state or foreign Governmental Authority relating to any order,
ruling, statute or other law or regulation that could reasonably be expected to
have a Material Adverse Effect; and


 


46

















 


(g)           Requested
Information — with reasonable promptness, such other data and information
relating to the business, operations, affairs, financial condition, assets or
properties of the Borrower or any of its Subsidiaries or relating to the
ability of the Borrower to perform its obligations hereunder and under the
other Financing Documents as from time to time may be reasonably requested by
the Administrative Agent or any Lender.


 


Section 5.02.        Officer’s
Certificate.  The Borrower shall
deliver to the Administrative Agent and each Lender within 60 days after the
end of each quarterly fiscal period in each fiscal year of the Borrower (other
than the last quarterly fiscal period of each such fiscal year) and within 120
days after the end of each fiscal year of the Borrower, a certificate in the
form of Exhibit E of a Senior Financial Officer setting forth:


 


(a)           Covenant
Compliance — the information (including detailed calculations) required in
order to establish whether the Borrower was in compliance with the requirements
of Section 6.01 through Section 6.05 hereof, inclusive,
and Section 6.10, during the quarterly or annual period covered by
the most recent statements furnished (including with respect to each such
Section, where applicable, the calculations of the maximum or minimum amount,
ratio or percentage, as the case may be, permissible under the terms of such
Sections, and the calculation of the amount, ratio or percentage then in
existence); and


 


(b)           Event of Default
— a statement that such officer has reviewed the relevant terms hereof and has
made, or caused to be made, under his or her supervision, a review of the
transactions and conditions of the Borrower and its Subsidiaries from the
beginning of the quarterly or annual period covered by the most recent
statements furnished to the date of the certificate and that such review shall
not have disclosed the existence during such period of any condition or event
that constitutes a Default or, if any such condition or event existed or exists
(including, without limitation, any such event or condition resulting from the
failure of the Borrower or any Subsidiary to comply with any Environmental
Law), specifying the nature and period of existence thereof and what action the
Borrower shall have taken or proposes to take with respect thereto.


 


Section 5.03.        Inspection.  The Borrower shall permit the representatives
of the Administrative Agent and each Lender:


 


(a)           No Default —
if no Default under Article VI or Subsection (b) of Article VII
hereof or no Event of Default then exists, at the expense of such Lender or the
Administrative Agent and upon reasonable prior notice to the Borrower, to visit
the principal executive office of the Borrower, to discuss the affairs,
finances and accounts of the Borrower and its Restricted Subsidiaries with the
Borrower’s officers, and (with the consent of the Borrower, which consent will
not be unreasonably withheld) its independent public accountants, and (with the
consent of the Borrower, which consent will not be unreasonably withheld) to
visit the other offices and properties of the Borrower and each Restricted
Subsidiary, all at such reasonable times and as often as may be reasonably
requested in writing; and


 


47

















 


(b)           Default —  if a Default under Article VI or
Subsection (b) of Article VII hereof or an Event of Default
then exists, at the expense (all of which expenses shall be reasonable) of the
Borrower, to visit and inspect any of the offices or properties of the Borrower
or any Restricted Subsidiary, to examine all their respective books of account,
records, reports and other papers, to make copies and extracts therefrom, and
to discuss their respective affairs, finances and accounts with their
respective officers and independent public accountants (and by this provision
the Borrower authorizes said accountants to discuss the affairs, finances and
accounts of the Borrower and its Restricted Subsidiaries), all at such times
and as often as may be requested.


 


Section 5.04.          Reporting
Treatment of Unrestricted Subsidiaries. 
Notwithstanding anything to the contrary contained in this Agreement, so
long as the Unrestricted Subsidiaries continue to constitute, in the aggregate,
less than 7% of Consolidated Total Capitalization in any fiscal period, the
Borrower shall be permitted to include, for purposes of the financial reporting
requirements contained in Sections 5.01(a) and (b), and
only for purposes of such Sections (and in no event for purposes of
determining compliance with any of the covenants contained in this Article V
or Article VI hereof), the financial information of such entities
on a consolidated basis.  If at any time
the Unrestricted Subsidiaries shall constitute, in the aggregate, 7% or more of
Consolidated Total Capitalization in any fiscal period, the Borrower shall,
notwithstanding that Section 5.01(a) and (b) permit
the Borrower to comply therewith by delivery of its Quarterly Reports on SEC Form 10-Q
and Annual Reports on SEC Form 10-K, either:  (a) provide consolidating financial
statements setting forth separately the financial information for the
Unrestricted Subsidiaries for such period, together with the financial
information of such entities on a consolidated basis for purposes of the
financial reporting requirements contained in Sections 5.01(a) and
(b) and only for purposes of such Sections (and in no event
for purposes of determining compliance with any of the covenants contained in
this Article V or Article VI hereof) or (b) exclude
the financial information on a consolidated basis for the Unrestricted
Subsidiaries from the consolidated financial statements required to be
delivered by the Borrower for such period pursuant to Sections 5.01(a) and
(b).  In no event shall the
Borrower include financial information of the Unrestricted Subsidiaries for
purposes of any determination of compliance with any of the covenants contained
in this Article V or Article VI hereof.


 


Section 5.05.          Compliance
with Law.  The Borrower will, and
will cause each of its Subsidiaries to, comply with all laws, ordinances or
governmental rules or regulations to which each of them is subject,
including, without limitation, ERISA and all Environmental Laws, and will
obtain and maintain in effect all licenses, certificates, permits, franchises
and other governmental authorizations necessary to the ownership of their
respective properties or to the conduct of their respective businesses, in each
case to the extent necessary to ensure that non-compliance with such laws,
ordinances or governmental rules or regulations or failures to obtain or
maintain in effect such licenses, certificates, permits, franchises and other
governmental authorizations could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.


 


Section 5.06.          Insurance.  The Borrower will, and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms


 


48

















 


and in
such amounts (including deductibles, co-insurance and self- insurance, if
adequate reserves are maintained with respect thereto) as is customary in the
case of entities of established reputations engaged in the same or a similar business
and similarly situated.


 


Section 5.07.          Maintenance
of Properties.  The Borrower will,
and will cause each of its Subsidiaries to, maintain and keep, or cause to be
maintained and kept, their respective properties in good repair, working order
and condition (other than ordinary wear and tear), so that the business carried
on in connection therewith may be properly conducted at all times; provided
that this Section shall not prevent the Borrower or any Subsidiary from
discontinuing the operation and the maintenance of any of its properties if
such discontinuance is desirable in the conduct of its business and the Board
of Directors of the Borrower has concluded that such discontinuance could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.


 


Section 5.08.          Payment
of Taxes and Claims.  The Borrower
will, and will cause each of its Subsidiaries to, file all tax returns required
to be filed in any jurisdiction and to pay and discharge all taxes shown to be
due and payable on such returns and all other taxes, assessments, governmental
charges, or levies imposed on them or any of their properties, assets, income
or franchises, to the extent such taxes and assessments have become due and
payable and before they have become delinquent and all claims for which sums
have become due and payable that have or might become a Lien on properties or
assets of the Borrower or any Restricted Subsidiary; provided that
neither the Borrower nor any Subsidiary need pay any such tax or assessment or
claims if (a) the amount, applicability or validity thereof is contested
by the Borrower or such Subsidiary on a timely basis in good faith and in
appropriate proceedings, and the Borrower or a Subsidiary has established
adequate reserves therefor in accordance with GAAP on the books of the Borrower
or such Subsidiary or (b) the nonpayment of all such taxes and
assessments, governmental charges, levies and claims in the aggregate could not
reasonably be expected to have a Material Adverse Effect.


 


Section 5.09.          Corporate
Existence, Etc.  The Borrower will at
all times preserve and keep in full force and effect its corporate existence
and will keep proper books of record and account reflecting its business and
activities.  Subject to Section 6.05,
the Borrower will at all times preserve and keep in full force and effect the
corporate existence of each of its Subsidiaries (unless merged into the
Borrower or a Subsidiary) and all rights and franchises of the Borrower and its
Subsidiaries unless, in the good faith judgment of the Borrower, the
termination of or failure to preserve and keep in full force and effect such
corporate existence, right or franchise could not, individually or in the
aggregate, have a Material Adverse Effect.


 


Section 5.10.          Nature
of Business.  Neither the Borrower
nor any Restricted Subsidiary will engage in any business if, as a result, the
general nature of the business, taken on a consolidated basis, which would then
be engaged in by the Borrower and its Restricted Subsidiaries would be
substantially changed from the general nature of the business engaged in by the
Borrower and its Restricted Subsidiaries on the date of this Agreement.


 


Section 5.11.          Additional
Guarantors.  The Borrower will, and
will cause its Subsidiaries to, promptly inform the Administrative Agent of the
creation or acquisition of any direct or indirect Subsidiary (subject to the
provisions of Section 6.05) and cause each direct or indirect


 


49

















 


Subsidiary
not in existence on the date hereof to enter into a Guarantee substantially in
the form of Exhibit D.  In
connection therewith, the Borrower or any applicable Subsidiary shall provide
such resolutions, certificates and opinions of counsel as shall be reasonably
requested by the Administrative Agent.


 


ARTICLE VI


 


Negative Covenants


 


Until the Commitments have
expired or terminated and the principal of and interest on each Loan and all
fees and other Obligations payable hereunder have been paid in full and all
Letters of Credit have expired or terminated and all LC Disbursements shall
have been reimbursed, the Borrower covenants and agrees with the Lenders that:


 


Section 6.01.          Financial Ratios.


 


(a)           The
Borrower will not at any time permit the ratio determined at the end of each
fiscal quarter on a rolling four quarter basis of (i) Consolidated EBITDA
to (ii) Consolidated Cash Interest Expense to be less than 3.00:1.00.


 


(b)           The
Borrower will not at any time permit the ratio determined at the end of each fiscal
quarter on a rolling four fiscal quarter basis of (i) Consolidated
Indebtedness to (ii) Consolidated Adjusted EBITDA to be greater than
3.00:1.00.


 


Section 6.02.          Limitations on Indebtedness.


 


(a)           The
Borrower will not, and will not permit any Subsidiary to, create, incur, assume
or permit to exist any Indebtedness, except if both before and after giving
effect to any such creation, incurrence or assumption the Borrower is in
compliance with Section 6.01 hereof.


 


(b)           The
Borrower will not permit any Subsidiary to create, incur, assume or permit to
exist any Indebtedness if, after giving effect to any such creation, incurrence
or assumption, the aggregate amount of all such Indebtedness then outstanding
shall exceed ten percent of the total consolidated assets of the Borrower and
its Restricted Subsidiaries.


 


Section 6.03.          Limitation
on Liens.  The Borrower will not, and
will not permit any Restricted Subsidiary to, create or incur, or suffer to be
incurred or to exist, any Lien on its or their property or assets, whether now
owned or hereafter acquired, or upon any income or profits therefrom, or
transfer any property for the purpose of subjecting the same to the payment of
obligations in priority to the payment of its or their general creditors, or
acquire or agree to acquire, or permit any Subsidiary to acquire, any property
or assets upon conditional sales agreements or other title retention devices,
except:


 


(a)           Liens for property
taxes and assessments or governmental charges or levies and Liens securing
claims or demands of mechanics and materialmen; provided that payment
thereof is not at the time required by Section 5.08;


 


50

















 


(b)           Liens of or
resulting from any judgment or award, the time for the appeal or petition for
rehearing of which shall not have expired, or in respect of which the Borrower
or a Restricted Subsidiary shall at any time in good faith be prosecuting an
appeal or proceeding for a review and in respect of which a stay of execution
pending such appeal or proceeding for review shall have been secured;


 


(c)           Liens incidental to
the conduct of business or the ownership of properties and assets (including
Liens in connection with worker’s compensation, unemployment insurance and
other like laws, warehousemen’s and attorneys’ liens and statutory landlords’
liens) and Liens to secure the performance of bids, tenders or trade contracts,
or to secure statutory obligations, surety or appeal bonds or other Liens of
like general nature, in any such case incurred in the ordinary course of
business and not in connection with the borrowing of money; provided in each
case, the obligation secured is not overdue or, if overdue, is being contested
in good faith by appropriate actions or proceedings;


 


(d)           minor survey
exceptions or minor encumbrances, easements or reservations, or rights of
others for rights-of-way, utilities and other similar purposes, or zoning or
other restrictions as to the use of real properties, which are necessary for
the conduct of the activities of the Borrower and its Restricted Subsidiaries
or which customarily exist on properties of corporations engaged in similar
activities and similarly situated and which do not in any event materially
impair their use in the operation of the business of the Borrower and its
Restricted Subsidiaries;


 


(e)           Liens securing
Indebtedness of a Restricted Subsidiary to the Borrower or to another
Wholly-owned Restricted Subsidiary;


 


(f)            Liens existing on
the date hereof as scheduled on Schedule 6.03 annexed hereto;


 


(g)           Liens on fixed or
capital assets acquired, constructed or improved by the Borrower or any
Subsidiary; provided that (i) such security interests secure
Indebtedness permitted by Section 6.02, (ii) such Liens and
the Indebtedness secured thereby are incurred prior to or within 90 days after
such acquisition or the completion of such construction or improvement, (iii) the
Indebtedness secured thereby does not exceed 100% of the cost of acquiring,
constructing or improving such fixed or capital assets and (iv) such
security interests shall not apply to any other property or assets of the
Borrower or any Subsidiary;


 


(h)           Other Liens securing
Indebtedness other than as described in the foregoing clauses (a) through
(g) above, provided that the Indebtedness secured by all such other
Liens does not exceed at any time ten percent of the total consolidated assets
of the Borrower and its Restricted Subsidiaries.


 


Section 6.04.          Limitation
on Sale and Leasebacks.  The Borrower
will not, and will not permit any Restricted Subsidiary to, enter into any
arrangement, directly or indirectly, whereby the Borrower or such Restricted
Subsidiary shall in one or more related transactions sell, transfer


 


51

















 


or
otherwise dispose of any property owned by the Borrower or such Restricted
Subsidiary more than 180 days after the later of the date of initial
acquisition of such property or completion or occupancy thereof, as the case
may be, by the Borrower or such Restricted Subsidiary, and then rent or lease,
as lessee, such property or any part thereof (a “Sale and Leaseback
Transaction”); provided that the foregoing restriction shall not
apply to any Sale and Leaseback Transaction if immediately after the
consummation of such Sale and Leaseback Transaction and after giving effect
thereto, any of the following conditions is satisfied:


 


(a)           the lease relating
to such Sale and Leaseback Transaction is not a Long-Term Lease; or


 


(b)           the sale of property
relating to such Sale and Leaseback Transaction constitutes a sale of such
property by a Restricted Subsidiary to the Borrower or to a Wholly-owned
Restricted Subsidiary or by the Borrower to a Wholly-owned Restricted
Subsidiary; or


 


(c)           the sale of such
property is for cash consideration which (after deduction of any expenses
incurred by the Borrower or any Restricted Subsidiary in connection with such
Sale and Leaseback Transaction) equals or exceeds the fair market value of the
property so sold (as determined in good faith by the Board of Directors of the
Borrower) and the net proceeds from such sale are applied to either (i) the
purchase or acquisition (and, in the case of real property, the construction)
of fixed assets useful and intended to be used by the Borrower or a Restricted
Subsidiary in the operation of the business of the Borrower and its Restricted
Subsidiaries as described in Section 5.10 hereof (provided
that in any such event the Borrower and its Restricted Subsidiaries shall not
then or thereafter cause or permit or agree or consent to cause or permit such
tangible assets to be subject to any Lien) or (ii) the prepayment with the
applicable prepayment premium, if any, on a pro  rata basis, of
Senior Funded Debt of the Borrower; provided that if any such Senior
Funded Debt so prepaid constitutes Indebtedness outstanding under any revolving
credit or similar credit facility, such prepayment shall result in a permanent
reduction of the Indebtedness which the Borrower and its Restricted
Subsidiaries may incur thereunder by an amount at least equal to the amount of
the prepayment of such Senior Funded Debt; or


 


(d)           after giving effect
to the consummation of such Sale and Leaseback Transaction and to the
application of the proceeds therefrom, no Default would exist.


 


Section 6.05.          Mergers,
Consolidations and Sales of Assets and Acquisitions.  (a) Except with respect to a Permitted
Acquisition, the Borrower will not, and will not permit any Restricted
Subsidiary to, consolidate with or be a party to a merger with any other Person,
or sell, lease or otherwise dispose of all or substantially all of its assets
or acquire the assets or stock or business of any Person, provided that
any Restricted Subsidiary may merge or consolidate with or into the Borrower or
any Wholly-owned Restricted Subsidiary so long as in (1) any merger or
consolidation involving the Borrower, the Borrower shall be the surviving or
continuing corporation and (2) any merger or consolidation involving a
Wholly-owned Restricted


 


52

















 


Subsidiary
(and not the Borrower), the Wholly-owned Restricted Subsidiary shall be the
surviving or continuing corporation.


 


(b)           The
Borrower will not, and will not permit any Restricted Subsidiary to, sell,
lease, transfer, abandon or otherwise dispose of assets (except as provided in
this Section 6.05); provided that the foregoing restrictions
do not apply to:


 


(i)            the sale, lease, transfer or other
disposition of assets of a Restricted Subsidiary to the Borrower or a
Wholly-owned Restricted Subsidiary;


 


(ii)           the sale of inventory in the ordinary
course of business; or


 


(iii)          the sale of assets for cash or other
property to a Person or Persons other than an Affiliate if all of the following
conditions are met:


 


a.             such
assets (valued at net book value) do not, together with all other assets of the
Borrower and its Restricted Subsidiaries previously disposed of during the
immediately preceding twelve calendar month period, exceed 10% of the total
consolidated assets of the Borrower and its Restricted Subsidiaries, determined
by reference to the Consolidated balance of the Borrower twelve months prior to
the month in which such disposition occurs;


 


b.             in
the opinion of the Borrower’s Board of Directors, the sale is for fair value
and is in the best interests of the Borrower; and


 


c.             immediately
after the consummation of the transaction and after giving effect thereto, no
Default would exist.


 


Section 6.06.          Transactions
with Affiliates.  The Borrower will
not, and will not permit any Restricted Subsidiary to, enter into or be a party
to any transaction or arrangement with any Affiliate (including, without
limitation, the purchase from, sale to or exchange of property with, or the
rendering of any service by or for, any Affiliate), except in the ordinary
course of and pursuant to the reasonable requirements of the Borrower’s or such
Restricted Subsidiary’s business and upon fair and reasonable terms no less
favorable to the Borrower or such Restricted Subsidiary than would obtain in a
comparable arm’s-length transaction with a Person other than an Affiliate.


 


Section 6.07.          Designation
of Subsidiaries.  The Borrower may
designate or redesignate any Unrestricted Subsidiary as a Restricted Subsidiary
and may designate or redesignate any Restricted Subsidiary as an Unrestricted
Subsidiary only with the prior written consent of the Required Lenders.  If the Required Lenders consent to the
designation of a Restricted Subsidiary as an Unrestricted Subsidiary and after giving
effect thereto, then (i) such Unrestricted Subsidiary so designated shall
not, directly or indirectly, own any Indebtedness or capital stock of the
Borrower or any Restricted Subsidiary, and (ii) the designation of such
Restricted Subsidiary as an Unrestricted Subsidiary shall be deemed to be a
sale or other disposition of assets to be consummated within the limitations of
Section 6.05(b)(iii).  If the
Required Lenders consent to the designation of an Unrestricted Subsidiary as a
Restricted Subsidiary and after


 


53

















 


giving
effect thereto, then all existing Liens of such Restricted Subsidiary so
designated shall be permitted within the applicable limitations of Section 6.03.


 


Section 6.08.          Modification
of Operating Documents.  The Borrower
will not, and will not permit any of its Restricted Subsidiaries to, modify,
amend or alter their operating agreements, certificates or articles of
incorporation or other constitutive documents in a manner which could have a
Material Adverse Effect or would otherwise be materially disadvantageous to the
Lenders.


 


Section 6.09.          Restrictive
Agreements.  The Borrower will not,
and will not permit any of its Restricted Subsidiaries 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 the Borrower or any Restricted Subsidiary 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 Restricted 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 this
Agreement, (ii) the foregoing shall not apply to restrictions and
conditions under the Senior Note Agreement existing on the date hereof (but
shall apply to any amendment or modification expanding the scope or duration
of, any such restriction or condition), (iii) the foregoing shall not
apply to customary restrictions and conditions contained in agreements relating
to the sale of a Restricted Subsidiary or any asset pending such sale, provided
such restrictions and conditions apply only to the Restricted Subsidiary or
asset 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 Liens permitted by this Agreement if such restrictions or
conditions apply only to the property or assets subject to such permitted Lien
and (v) clause (a) of the foregoing shall not apply to customary
provisions in leases, licenses and other contracts restricting the assignment
thereof.


 


Section 6.10.          Restricted
Payments.  The Borrower will not, and
will not permit any of its Subsidiaries to, declare or make, or agree to pay or
make, directly or indirectly (including, without limitation, on a synthetic
basis through Swap Agreements), any Restricted Payment, except (a) the
Borrower may declare and pay dividends with respect to its Equity Interests
payable solely in additional Equity Interests, (b) Subsidiaries may
declare and pay dividends ratably with respect to their Equity Interests, (c) the
Borrower may make Restricted Payments pursuant to and in accordance with option
plans or other benefit plans for management or employees of the Borrower and
its Subsidiaries, (d) the Borrower may declare and pay cash dividends on
its Equity Interests not to exceed $10,000,000 in any fiscal year so long as at
the time thereof and immediately after giving effect thereto no Default shall
have occurred and be continuing and (e) the Borrower may make other
Restricted Payments in any fiscal quarter of any fiscal year in addition to
those permitted under (c) and (d) above so long as (i) at the
time thereof and immediately after giving effect thereto the aggregate amount
of such payments in such fiscal year does not exceed the sum of $25,000,000 plus
50% of Consolidated Net Income for the previous fiscal year less all
Restricted Payments previously made in cash in the current fiscal year pursuant
to subparagraphs (c) and (d) above and this subparagraph (e) and
(ii) as at the time thereof and immediately after giving effect thereto no
Default shall have occurred and be continuing.


 


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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 to 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 solely in the case of any reimbursement obligations
such default shall continue for a period of one Business Day;


 


(b)           the Borrower shall
fail to pay any interest on any Loan, the Revolving Credit Commitment Fee or any
other fee or any other amount (other than an amount referred to in clause (a) of
this Article) payable under this Agreement or any other Financing Document,
when and as the same shall become due and payable and such default shall
continue for a period of five consecutive days;


 


(c)           any representation
or warranty made or deemed made by the Borrower or any Restricted Subsidiary or
Guarantor in the Financing Documents, or in any report, certificate, financial
statement or other document furnished pursuant to the Financing Documents,
shall prove to have been incorrect in any material respect as of the date when
made or deemed made;


 


(d)           the Borrower shall
fail to observe or perform any covenant, condition or agreement contained in Section 3.15,
5.01(a) through (d), 5.02, 5.09 or in Article VI;


 


(e)           the Borrower or any
Restricted Subsidiary or Guarantor shall fail to observe or perform any
covenant, condition or agreement contained in this Agreement (other than those
specified in clause (a), (b) or (d) of this Article) or any
other Financing Document, and such failure shall continue unremedied for a
period of 15 days after the Borrower receives notice of such default from
the Administrative Agent (which notice shall be given at the request of any
Lender);


 


(f)            Borrower or any
Restricted Subsidiary or Guarantor (i) fails to make any payment when due
(whether by scheduled maturity, required prepayment, acceleration, demand, or
otherwise) in respect of any Material Indebtedness (other than Indebtedness
hereunder), or (ii) fails to observe or perform any other agreement or
condition relating to any such Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event occurs,
the effect of which default or other event is to cause, or to permit the holder
or holders or the beneficiary or beneficiaries of such Indebtedness (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such Indebtedness
to be demanded or to become due or to be repurchased, prepaid, defeased or
redeemed (automatically or otherwise), or an offer to repurchase, prepay,


 


55
















 


defease or redeem
such Indebtedness to be made, prior to its stated maturity, or cash collateral
in respect thereof to be demanded;


 


(g)           an involuntary
proceeding shall be commenced or an involuntary petition shall be filed seeking
(i) liquidation, reorganization or other relief in respect of the Borrower
or any Restricted Subsidiary or Guarantor 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 the Borrower or any Restricted Subsidiary or Guarantor 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;


 


(h)           the Borrower or any
Restricted Subsidiary or Guarantor 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 (g) of this Article, (iii) apply
for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any
Restricted Subsidiary or Guarantor 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;


 


(i)            the Borrower or any
Restricted Subsidiary or Guarantor shall become unable, admit in writing its
inability or fail generally to pay its debts as they become due;


 


(j)            one or more
judgments for the payment of money in an aggregate amount in excess of
$10,000,000 (not covered by insurance where the carrier has accepted
responsibility) shall be rendered against the Borrower, any Restricted
Subsidiary or Guarantor or any combination thereof and the same shall remain
undischarged for a period of 60 consecutive days during which execution shall
not be effectively stayed, or any action shall be legally taken by a judgment
creditor to attach or levy upon any material assets of the Borrower or any
Subsidiary to enforce any such judgment;


 


(k)           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;


 


(l)            a Change in Control
shall occur;


 


(m)          any of the Financing
Documents shall for any reason cease to be, or shall be asserted by any Person
obligated thereunder not to be, a legal, valid and binding obligation of such
Person;


 


56

















 


then, and in every such event (other than an event
with respect to the Borrower described in clause (g) or (h) 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 any one or more of the following actions, at
the same or different times:  (i) terminate
the Revolving Loan Commitments, and thereupon the Revolving Loan Commitments
shall terminate immediately, (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, (iii) require that the
Borrower deposit cash collateral to the extent of the LC Exposure or (iv) exercise
any other rights or remedies available under the Financing Documents or
applicable law; and in case of any event with respect to the Borrower described
in clause (g) or (h) of this Article, the Revolving Loan
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
(except as specifically provided for herein), all of which are hereby waived by
the Borrower.


 


ARTICLE VIII


 


The Administrative
Agent


 


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


 


The bank serving as the Administrative Agent
hereunder and under the other Financing Documents 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 Borrower or any Subsidiary or other Affiliate thereof
as if it were not the Administrative Agent hereunder.


 


The Administrative Agent shall not have any
duties or obligations except those expressly set forth herein or in the other
Financing 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 hereby or thereby that the Administrative Agent is required to
exercise in writing 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 herein, the Administrative Agent
shall not have any duty to disclose, and shall not be liable for any failure to
disclose, any


 


57

















 


information relating to the
Borrower 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 wilful 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 this Agreement, (ii) the contents or accuracy of any
certificate, report or other document delivered hereunder or in connection
herewith, (iii) the performance or observance of any of the covenants,
agreements or other terms or conditions set forth herein, (iv) the
validity, enforceability, effectiveness or genuineness of this Agreement or any
other agreement, instrument or document, or (v) the satisfaction of any
condition set forth in Article IV or elsewhere herein, other than
to confirm receipt of items expressly required to be delivered to the
Administrative Agent.


 


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 of 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.


 


In the event that a petition seeking relief
under Title 11 of the United States Code or any other Federal, state or
foreign bankruptcy, insolvency, liquidation or similar law is filed by or
against the Borrower or any other Person obligated under the Financing
Document, the Administrative Agent is authorized, to the fullest extent permitted
by applicable law, to file a proof of claim on behalf of itself and the Lenders
in such proceeding for the total amount of obligations owed by such
Person.  With respect to any such proof
of claim which the Administrative Agent may file, each Lender acknowledges that
without reliance on such proof of claim, such Lender shall make its own
evaluation as to whether an individual proof of claim must be filed in respect
of such obligations owed to such Lender and, if so, take the steps necessary to
prepare and timely file such individual claim.


 


58

















 


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, with the approval
of the Borrower (not to be unreasonably withheld, except that no such approval
shall be required upon the occurrence and continuance of an Event of Default),
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, appoint a successor Administrative Agent which shall be
a bank with an office in New York, New York, or an Affiliate of any
such bank with such an office.  Upon the
acceptance of its appointment as Administrative Agent hereunder by a successor,
such successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder.  The fees payable by the
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 related
agreement or any document furnished hereunder or thereunder.  Each Lender acknowledges the potential
conflict of interest of each other Lender as a result of Lenders holding
disproportionate interests in the Loans, and expressly consents to and waives
any claim based upon such conflict of interest.


 


The parties hereto agree that the titles
Co-Syndication Agent and Documentation Agent are honorary and confer no duties
upon such agents, except as a Lender hereunder.


 


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 telecopy, as
follows:


 


59

















 


(i)            if to the Borrower, to it at 9333
Balboa Avenue, San Diego, CA 92123, Attention of John D. Thomas (Telecopy No. 858-505-1548)
with copies for informational purposes only to Assistant General Counsel
(Telecopy No. 858-505-1559);


 


(ii)           if to the Administrative Agent, to
JPMorgan Chase Bank, N.A., 10 South Dearborn, 7th Floor, Chicago, Illinois 60603, Attention of
Latanya Driver (Telecopy No. 312-385-7096 with copies for information
purposes only to Brian E. Newhouse, Esq., Mayer Brown LLP, 350 South Grand
Avenue, Los Angeles, CA 90071 (Telecopy No. 213-625-0248); and


 


(iii)          if to any other Lender, to it at its
address (or telecopy number) set forth in its Administrative Questionnaire.


 


(b)           Notices
and other communications to the Lenders hereunder may be delivered or furnished
by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to
notices pursuant to Article II unless otherwise agreed by the
Administrative Agent and the applicable Lender. 
The Administrative Agent or the Borrower may, in its discretion, agree
to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.


 


(c)           Any
party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto.  All notices and other communications given to
any party hereto in accordance with the provisions of this Agreement shall be
deemed to have been given on the date of receipt.


 


Section 9.02.          Waivers;
Amendments.  (a) No failure or
delay by the Administrative Agent, or any Lender in exercising any right or
power hereunder 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 and the Lenders hereunder are cumulative and are not exclusive of any
rights or remedies that they would otherwise have.  No waiver of any provision of this Agreement
or consent to any departure by the Borrower 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 shall not be construed as a waiver of any Default,
regardless of whether the Administrative Agent or any Lender may have had
notice or knowledge of such Default at the time.


 


(b)           Neither
this Agreement nor any provision hereof nor any provision of any other
Financing Document hereof may be waived, amended or modified except pursuant to
an agreement or agreements in writing entered into by the Borrower and the
Required Lenders or by the Borrower and the Administrative Agent 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
the principal amount of any Loan or Note or reduce the rate


 


60

















 


of interest thereon, or reduce any fees payable
hereunder, without the written consent of each Lender directly affected
thereby, (iii) postpone the Maturity Date or the scheduled date of payment of
the principal amount of any Loan, or any interest thereon, or any fees 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 2.17(b) or
(c) in a manner that would alter the pro rata sharing of payments
required thereby, without the written consent of each Lender, (v) release
any Guarantee (other than in accordance with its terms), forego any additional
Guarantee pursuant to Section 5.11 or modify the 85% requirement in
the definition of “Guarantor” without the written consent of each Lender, (vii) change
Section 2.19 without the written consent of the Required Lenders,
the Administrative Agent, the Swingline Lender and the Issuing Bank, or (viii) change
any of the provisions of this Section or the definitions of “Required Lenders”
or “Defaulting Lender” or any other provision hereof specifying the number or
percentage of Lenders required to waive, amend or modify any rights hereunder
or make any determination or grant any consent hereunder, 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 hereunder without the prior written consent of the
Administrative Agent.


 


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 of the credit facilities provided for herein,
the preparation of this Agreement or any amendments, modifications or waivers
requested by the Borrower of the provisions hereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), (ii) during
the continuance of a Default, all out-of-pocket expenses incurred by the
Administrative Agent or any Lender, including the fees, charges and
disbursements of any counsel for the Administrative Agent or any Lender, in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section, or in connection with
the Loans made hereunder, including all such out-of-pocket expenses incurred
during any workout, restructuring or negotiations in respect of such Loans.


 


(b)           The
Borrower shall indemnify the Administrative Agent 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, 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 this Agreement or any agreement
or instrument contemplated hereby, the performance by the parties hereto of
their respective obligations hereunder or the consummation of the Transactions
or any other transactions contemplated hereby, (ii) any Loan or the use of
the proceeds therefrom, (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned 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


 


61

















 


that such indemnity shall not, as to any Indemnitee,
be available to the extent that such losses, claim, damages, 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 wilful
misconduct of such Indemnitee.  Without
limiting the generality of the foregoing and in addition to any indemnity
provided for herein, the Borrower shall pay, and hold each Indemnitee harmless
from, any civil penalty or fine assessed by the U.S. Department of the Treasury’s
Office of Foreign Assets Control against any Indemnitee, and all reasonable
costs and expenses (including counsel fees and disbursements) incurred in
connection with the defense thereof, arising as a result of the funding of
Loans or the issuance of Lender Letters of Credit or Letter of Credit
Participation Agreement or the acceptance of any payments made under a Loan
Document.


 


(c)           To
the extent that the Borrower fails to pay any amount required to be paid by it
to the Administrative Agent under paragraph (a) or (b) of this
Section, each Lender severally agrees to pay to the Administrative Agent, such
Lender’s pro rata share (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought and based upon the
outstanding principal balance of the Revolving Credit Exposure) of such unpaid
amount; provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred
by or asserted against the Administrative Agent in its capacity as such.


 


(d)           To
the extent permitted by applicable law, the Borrower shall not assert, and
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 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, 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
and, to the extent expressly contemplated hereby, the Related Parties of each
of the Administrative Agent and the Lenders) any legal or equitable right,
remedy or claim under or by reason of this Agreement.


 


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


 


62

















 


(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 (as defined below) or, if an Event of
Default under Article VII has occurred and is continuing, any other
assignee; and


 


(B)           the Administrative Agent.


 


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


 


(A)          except in the case of an assignment to
a Lender or an Affiliate of a Lender or an assignment of the entire remaining
amount of the assigning Lender’s Commitment or Loans, the amount of the
Commitment or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$5,000,000 and such assigning Lender shall retain Commitments of not less than
$10,000,000, unless each of the Borrower and the Administrative Agent otherwise
consent, provided that no such consent of the Borrower shall be required
if an Event of Default under Article VII has occurred and is
continuing;


 


(B)           each partial assignment shall be made
as an assignment of a proportionate part of all the assigning Lender’s rights
and obligations under this Agreement;


 


(C)           the assignor and assignee 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.


 


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


 


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


 


(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


 


63

















 


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 2.14, 2.15, 2.16 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 owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, absent manifest error, and the Borrower, the Administrative Agent
and the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary.  The Register shall be available for
inspection by the Borrower 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, any Note or Notes subject to such
assignment 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.  No assignment shall be
effective for purposes of this Agreement unless it has been recorded in the
Register as provided in this paragraph. 
Upon notice to the Borrower, at the Borrower’s expense, the Borrower
shall execute and deliver to the Administrative Agent in exchange for such
surrendered Notes, new Notes to the order of the assignee in an  amount equal to the portion of the Commitments
assumed by it pursuant to such Assignment and Assumption and, if the assigning
Lender has retained any Commitment hereunder, new Notes to the order of the
assigning Lender in an amount equal to the Commitment retained by it hereunder.


 


(c)           (i)            Any Lender may, without the consent
of the Borrower or the Administrative Agent, 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 Commitments 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 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


 


64

















 


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, to the fullest
extent permitted under applicable law, that each Participant shall be entitled
to the benefits of Sections 2.14, 2.15 and 2.16 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 2.17(c) as
though it were a Lender.


 


(ii)           A
Participant shall not be entitled to receive any greater payment under Section 2.14
or 2.16 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 2.16
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 2.16(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 and the Notes issued to such Lender
to secure obligations of such Lender, including 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 Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Loans regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Administrative Agent 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
and so long as the Commitments have not expired or terminated.  The provisions of Sections 2.14, 2.15,
2.16 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 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 Financing 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


 


65
















 


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 telecopy shall be effective as
delivery of a manually executed counterpart of this Agreement.


 


Section 9.07.          Severability.  Any provision of this Agreement 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 hereof, and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.


 


Section 9.08.          Right
of Setoff.  If an Event of Default
shall have occurred and be continuing, each Lender and each of its Affiliates
is hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
obligations at any time owing by such Lender or Affiliate to or for the credit
or the account of the Borrower or its Subsidiaries against any of and all the
obligations of the Borrower or its Subsidiaries now or hereafter existing under
this Agreement held by such Lender, irrespective of whether or not such Lender
shall have made any demand under this Agreement and although such obligations
may be unmatured.  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) THIS AGREEMENT, IN ACCORDANCE WITH SECTION 5-1401
OF THE GENERAL OBLIGATION LAW OF THE STATE OF NEW YORK, SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO ANY CONFLICTS OF LAWS PRINCIPLES THEREOF THAT WOULD CALL FOR THE
APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION.


 


(b)           The
Borrower hereby irrevocably and unconditionally submits, for itself and its property,
to the nonexclusive jurisdiction of the Supreme Court of the State of
New York sitting in New York County and of the United States District
Court for the Southern District of New York, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Agreement, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such
New York State or, to the extent permitted by law, in such Federal
court.  Each of the parties hereto agrees
that a final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.  Nothing in this
Agreement shall affect any right that the Administrative Agent or any Lender
may otherwise have to bring any action or proceeding relating to this Agreement
against the Borrower or its properties in the courts of any jurisdiction.


 


66

















 


(c)           The
Borrower hereby irrevocably and unconditionally waives, to the fullest extent
it may legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Agreement in any court referred to in paragraph (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 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 OR THE TRANSACTIONS CONTEMPLATED HEREBY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.


 


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


 


Section 9.12.          Confidentiality.  Each of the Administrative Agent 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,
rating agencies, portfolio management servicers, 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 applicable laws or
regulations 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 the enforcement of rights hereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to any
assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations under this Agreement in which case
Borrower shall be notified of the name of such assignee or participant and the
Administrative Agent and the Borrower shall be provided with an executed copy
of such confidentiality agreement, (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 or any Lender on a nonconfidential basis
from a source other than the Borrower. 
Notwithstanding the foregoing, each of the Administrative Agent and the
Lenders may disclose to any and all Persons, without 


 


67

















 


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


 


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


 


68

















 


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.


 


	
   

  	
  CUBIC CORPORATION, Borrower

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  John D. Thomas

  
	
   

  	
   

  	
  Title:

  	
  Vice President Finance/

  
	
   

  	
   

  	
   

  	
  Corporate Development

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  William
  W. Boyle

  
	
   

  	
   

  	
  Title:

  	
  Senior
  Vice President and

  
	
   

  	
   

  	
   

  	
  Chief Financial Officer

  



 

















 


	
   

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

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 

















 


	
   

  	
  BANK
  OF THE WEST, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 

















 


	
   

  	
  UNION BANK, N.A., as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 

















 


	
   

  	
  U.S.
  BANK NATIONAL ASSOCIATION, 

  
	
   

  	
  as
  a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 

















 


	
   

  	
  WELLS
  FARGO BANK, NATIONAL  ASSOCIATION, as a
  Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 

















 


	
   

  	
  BRANCH BANKING AND TRUST COMPANY, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 
















 


SCHEDULE 1.01


 


Existing Letters of Credit


 


	
  Issuer

  	
   

  	
  Issuance Date

  	
   

  	
  Issued

  Currency

  	
   

  	
  Issued

  Currency

  Amount

  	
   

  	
  USD

  Equivalent

  	
   

  	
  Amount

  	
   

  	
  Beneficiary Name

  	
   

  	
  Expiry

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Jun 26, 2009

  	
   

  	
  USD

  	
   

  	
  442,156.50

  	
   

  	
  USD

  	
   

  	
  $

  	
  442,156.50

  	
   

  	
  JPMorgan
  Chase Bank, N.A.

  	
   

  	
  Mar 09, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Jan 09, 2008

  	
   

  	
  NZD

  	
   

  	
  1,451,651.85

  	
   

  	
  USD

  	
   

  	
  $

  	
  1,036,914.92

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 02, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Jan 09, 2008

  	
   

  	
  USD

  	
   

  	
  712,060.00

  	
   

  	
  USD

  	
   

  	
  $

  	
  712,060.00

  	
   

  	
  Government of Israel

  	
   

  	
  Dec 31, 2009

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Mar 16, 2006

  	
   

  	
  SGD

  	
   

  	
  474,168.98

  	
   

  	
  USD

  	
   

  	
  $

  	
  342,558.14

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Jan 30, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Mar 16, 2006

  	
   

  	
  USD

  	
   

  	
  1,296,787.55

  	
   

  	
  USD

  	
   

  	
  $

  	
  1,296,787.55

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Jan 30, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Jan 09, 2008

  	
   

  	
  NZD

  	
   

  	
  1,277,744.65

  	
   

  	
  USD

  	
   

  	
  $

  	
  912,693.00

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 02, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Dec 21, 2006

  	
   

  	
  USD

  	
   

  	
  1,298,760.00

  	
   

  	
  USD

  	
   

  	
  $

  	
  1,298,760.00

  	
   

  	
  Riyad Bank Ltd.

  	
   

  	
  Mar 02, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Sep 17, 2007

  	
   

  	
  USD

  	
   

  	
  625,000.00

  	
   

  	
  USD

  	
   

  	
  $

  	
  625,000.00

  	
   

  	
  TMB Bank PCL

  	
   

  	
  Mar 02, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  May 09, 2008

  	
   

  	
  AUD

  	
   

  	
  94,790.64

  	
   

  	
  USD

  	
   

  	
  $

  	
  86,657.60

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Dec 30, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Sep 09, 2008

  	
   

  	
  SGD

  	
   

  	
  1,590,721.85

  	
   

  	
  USD

  	
   

  	
  $

  	
  1,149,199.43

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 02, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Aug 15, 2008

  	
   

  	
  SGD

  	
   

  	
  321,357.95

  	
   

  	
  USD

  	
   

  	
  $

  	
  232,161.50

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 02, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Jan 27, 2009

  	
   

  	
  AUD

  	
   

  	
  100,000.00

  	
   

  	
  USD

  	
   

  	
  $

  	
  91,420.00

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Jan 15, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Feb 13, 2009

  	
   

  	
  CAD

  	
   

  	
  3,446,715.35

  	
   

  	
  USD

  	
   

  	
  $

  	
  3,260,847.07

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Feb 12, 2011

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Feb 24, 2009

  	
   

  	
  SGD

  	
   

  	
  215,000.00

  	
   

  	
  USD

  	
   

  	
  $

  	
  155,324.38

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 09, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Feb 24, 2009

  	
   

  	
  SGD

  	
   

  	
  44,000.00

  	
   

  	
  USD

  	
   

  	
  $

  	
  31,787.31

  	
   

  	
  JPMorgan Chase Bank, N.A.

  	
   

  	
  Mar 02, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Mar 13, 2009

  	
   

  	
  USD

  	
   

  	
  14,440,626.50

  	
   

  	
  USD

  	
   

  	
  $

  	
  14,440,626.50

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 09, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Mar 13, 2009

  	
   

  	
  SGD

  	
   

  	
  1,372,536.25

  	
   

  	
  USD

  	
   

  	
  $

  	
  991,573.65

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 09, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Mar 13, 2009

  	
   

  	
  USD

  	
   

  	
  2,888,125.30

  	
   

  	
  USD

  	
   

  	
  $

  	
  2,888,125.30

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 09, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Mar 13, 2009

  	
   

  	
  SGD

  	
   

  	
  6,862,681.25

  	
   

  	
  USD

  	
   

  	
  $

  	
  4,957,868.26

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 09, 2010

  	
   

  
	
  Cubic
  Corporation

  	
   

  	
  Jun 17, 2009

  	
   

  	
  USD

  	
   

  	
  7,500,000.00

  	
   

  	
  USD

  	
   

  	
  $

  	
  7,500,000.00

  	
   

  	
  JPMorgan Chase Bank,
  N.A.

  	
   

  	
  Mar 09, 2010

  	
   

  
	
  Total USD as of
  December 15, 2009:

  	
   

  	
  $

  	
  42,452,521.11

  	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


SCHEDULE 2.01


 


Commitments


 


	
  Lender

  	
   

  	
  Revolving Credit 

  Commitment

  	
   

  	
  Approximate Percentage of Total

  Revolving Credit Commitment

  	
   

  
	
  JPMorgan Chase Bank, N.A.

  	
   

  	
  $

  	
  27,500,000

  	
   

  	
  18.33333

  	
  %

  
	
  Bank of the West

  	
   

  	
  $

  	
  24,500,000

  	
   

  	
  16.33333

  	
  %

  
	
  Union Bank, N.A.

  	
   

  	
  $

  	
  24,500,000

  	
   

  	
  16.33333

  	
  %

  
	
  U.S. Bank National Association

  	
   

  	
  $

  	
  24,500,000

  	
   

  	
  16.33333

  	
  %

  
	
  Wells Fargo Bank, National Association

  	
   

  	
  $

  	
  24,500,000

  	
   

  	
  16.33333

  	
  %

  
	
  Branch Banking and Trust Company

  	
   

  	
  $

  	
  24,500,000

  	
   

  	
  16.33333

  	
  %

  



 

















 


SCHEDULE
3.05


 


Disclosed Matters as to Litigation


 


There
is no action, suit or proceeding pending, or to the knowledge of the Borrower
threatened against or affecting the Borrower or any of its Restricted
Subsidiaries before any arbitrator or any Governmental Authority which would in
any material respect draw into question the enforceability of any of the
Financing Documents.


 


The
Borrower does not believe the following litigation matters could be reasonably
expected, individually or in the aggregate, to result in a Material Adverse
Effect, but wants the Lenders to be advised of the existence of such matters.


 


1.               U.S. Customs v. Cubic
Defense Systems.  Customs
assessed a proposed penalty of $449,427 against Cubic for importing certain
MILES equipment as duty free or at a duty lower than allegedly applicable.  Cubic reserved about $400,000 and plans to
appeal the amount of the penalty.


 


2.               Ministry of Defense and
Support for the Armed Forces of the Islamic Republic (Iran) v. Cubic Defense
Systems, Inc. (CDS).  In
1998 the Ministry of Defense for the Armed Forces of the Islamic Republic of
Iran obtained a United States District Court judgment enforcing an arbitration
award in its favor against Cubic in the amount of $2.8 million, plus costs and
interest.  Both parties appealed to the 9th Circuit Court of Appeals, where the cases are
stayed.  Third party judgment creditors
of Iran have filed liens against Iran’s Cubic judgment, but have not obtained
valid court orders enforcing the liens. 
We are not aware whether any such creditors received Terrorism Risk
Insurance Act funds (which could make their claims unenforceable).  Under a 1979 Presidential executive order,
all transactions by United States citizens with Iran are prohibited without a
license, which is rarely granted. 
Therefore, even if Iran were to prevail in the 9th Circuit litigation, it is unlikely that Cubic
would be permitted to pay any amount to Iran. 
Payments to valid lienors could potentially be enforced.  Cubic has appropriate reserves in place.


 


3.               Global Trac / eAccess.  Global Trac has presented a claim against
Cubic’s subsidiary eAccess for alleged patent infringement in the way a
smartcard antenna is attached to a chip. 
eAccess is investigating.


 


4.                                                                           Thyssen / US
Elevator.  Thyssen has
seven claims pending against Cubic involving personal injuries sustained in
elevators manufactured by Cubic’s subsidiary before 1992.  Cubic’s maximum liability on each claim
should be its $100,000 insurance deductible. 
Cubic denies liability as to all claims.


 


5.               Wise and Diaz v. CAI, CDA
and Cubic Corporation.  Class action
lawsuit against Cubic alleging misclassification of Training Analysts as exempt
from overtime and seeking damages for lack of overtime pay and back wages, as
well as damages for various violations of California and federal wage and hour
laws.  Cubic filed an Answer on January 6,
2009.  Cubic sent a Demand for indemnity
to its prime contractor, Raytheon.  Cubic
also made a Demand on its insurance carrier for 


 

















 


coverage on some or all of the claims.  Mediation was conducted on August 27,
2009 and the matter was settled for $1.7 million.  Cubic’s insurance carrier agreed to
contribute $300,000 toward the settlement. 
Cubic’s prime contractor has yet to respond.  Preparation of a settlement agreement and
related documents are in process. 
Preliminary court approval of the settlement is expected sometime after November 20,
2009.  Appropriate reserves have been
established.


 


2

















 


SCHEDULE 3.08


 


Disclosed Matters as to Environmental Compliance


 


None


 
















 


SCHEDULE 3.16A


 


Restricted Subsidiaries


 


	
  Subsidiary

  	
   

  	
  Place of

  Incorporation

  	
   

  	
  Percentage

  Owed

  	
   

  
	
  CUBIC APPLICATIONS, INC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Lacey, Washington

  	
   

  	
  California

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC COMMUNICATIONS,
  INC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  San Diego, California

  	
   

  	
  California

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC DE MEXICO

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tijuana, Mexico

  	
   

  	
  Mexico

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC DEFENSE
  APPLICATIONS, INC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  San Diego, California

  	
   

  	
  California

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC FOREIGN SALES,
  INC.

  	
   

  	
  St. Thomas

  	
   

  	
   

  	
   

  
	
  San Diego, California

  	
   

  	
  U.S.
  Virgin Islands

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC HOLDINGS LTD.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Auckland, New Zealand

  	
   

  	
  New
  Zealand

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC LAND, INC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  San Diego, California

  	
   

  	
  California

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC SECURITY
  SYSTEMS, INC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  San Diego, California

  	
   

  	
  California

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC SIMULATION
  SYSTEMS, INC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Orlando, Florida

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC TRANSPORTATION
  SYSTEMS, INC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  San Diego, California

  	
   

  	
  California

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  OMEGA TRAINING GROUP,
  INC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Columbus, Georgia

  	
   

  	
  Georgia

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EACCESS LLC

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  San Diego, California

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC FIELD SERVICES
  CANADA LIMITED

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ontario, Canada

  	
   

  	
  Canada

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC TRANSPORTATION
  SYSTEMS LIMITED

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  London, England

  * (100% owned subsidiary of Cubic (UK) Limited)

  	
   

  	
  England

  	
   

  	
  100

  	
  %*

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC TRANSPORTATION SYSTEMS
  (AUSTRALIA) PTY LIMITED

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New South Wales, Australia

  * (50% owned subsidiary of Cubic Corporation and 50% owned subsidiary of
  Cubic Transportation Systems, Inc.)

  	
   

  	
  Australia

  	
   

  	
  100

  	
  %*

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC (U.K.) LIMITED

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  London, England

  	
   

  	
  England

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC WORLDWIDE
  TECHNICAL SERVICES, INC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  San Diego, California

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  



 

















 


	
  CUBIC DEFENCE NEW
  ZEALAND

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Auckland, New Zealand 

  *(100% owned subsidiary of Cubic Holdings, Ltd.)

  	
   

  	
  New
  Zealand

  	
   

  	
  100

  	
  %*

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC DEFENCE AUSTRALIA
  PTY LIMITED

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New South Wales, Australia

  	
   

  	
  Australia

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CUBIC TRANSPORTATION
  SYSTEMS (INDIA) PRIVATE LIMITED

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hyderabad, India

  	
   

  	
  India

  	
   

  	
  100

  	
  %

  



 


2

















 


SCHEDULE 3.16B


 


Unrestricted Subsidiaries


 


None


 

















 


SCHEDULE 6.03


 


LIENS


 


	
  Security:

  	
   

  	
  First legal charge over
  the premises at AFC House, Honeycrock Lane, Salford, Surrey, UK

  
	
   

  	
   

  	
   

  
	
  Borrower:

  	
   

  	
  Cubic Transportation
  Systems, LTD

  
	
   

  	
   

  	
   

  
	
  Creditor/Lienholder:

  	
   

  	
  Barclays Bank PLC

  
	
   

  	
   

  	
   

  
	
  Original Balance:

  	
   

  	
  £ 5,200,000

  
	
   

  	
   

  	
   

  
	
  Remaining Balance:

  	
   

  	
  £ 3,120,000

  
	
   

  	
   

  	
   

  
	
  Value Date:

  	
   

  	
  02 December 2003

  
	
   

  	
   

  	
   

  
	
  Maturity Date:

  	
   

  	
  03 December 2018

  
	
   

  	
   

  	
   

  
	
  Interest Rate:

  	
   

  	
  Fixed at 6.4825%

  
	
   

  	
   

  	
   

  
	
  Payments:

  	
   

  	
  Quarterly each March,
  June, September and December

  
	
   

  	
   

  	
   

  
	
  Next Payment:

  	
   

  	
  £ 138,492.33 due 02
  March 2010

  



 

















 


EXHIBIT A


 


FORM OF ASSIGNMENT AND ASSUMPTION


 


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


 


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


 


	
  Assignor:

  	
   

  	
   

  



 


 


	
  Assignee:

  	
   

  	
   

  



[and is an Affiliate/Approved Fund of [identify Lender](1)]


 


 


Borrower:  Cubic Corporation


 






(1)               Select as applicable.


 


Administrative Agent:  JPMorgan Chase Bank, N.A., as the
administrative agent under the Credit Agreement


 


Credit Agreement: 
The First Amended and Restated Credit Agreement dated as of December 16,
2009 among Cubic Corporation, the Lenders parties thereto, and JPMorgan Chase
Bank, as Administrative Agent.


 


A-1

















 


Assigned Interest


 


	
  Facility
  Assigned

  	
   

  	
  Aggregate Amount of

  Commitment/Loans for

  all Lenders

  	
   

  	
  Amount of

  Commitment/Loans

  Assigned

  	
   

  	
  Percentage Assigned of

  Commitment/Loans

  	
   

  
	
  Revolving Commitment

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  



 


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


 


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


 


 


	
   

  	
  ASSIGNOR

  
	
   

  	
   

  
	
   

  	
  [NAME OF ASSIGNOR]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  ASSIGNEE

  
	
   

  	
   

  
	
   

  	
  [NAME OF ASSIGNEE]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
				



 


	
  Consented to and Accepted:

  	
   

  
	
   

  	
   

  
	
  JPMORGAN CHASE BANK, N.A., as Administrative Agent

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
  [Consented to:]

  	
   

  
	
   

  	
   

  
	
  CUBIC
  CORPORATION

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
				



 


A-2
















 


ANNEX
1


 


CUBIC
CORPORATION CREDIT AGREEMENT


 


STANDARD
TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION


 


1.             Representations
and Warranties.


 


(a)           Assignor.  The Assignor (a) represents and warrants
that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or any other
Financing Document, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Financing Documents or
any collateral thereunder, (iii) the financial condition of the Borrower,
any of its Subsidiaries or Affiliates or any other Person obligated in respect
of any Financing Document or (iv) the performance or observance by the
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Financing Document.


 


(b)           Assignee.  The Assignee (a) represents and warrants
that (i) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby and to become a Lender under
the Credit Agreement, (ii) it satisfies the requirements, if any,
specified in the Credit Agreement that are required to be satisfied by it in
order to acquire the Assigned Interest and become a Lender, (iii) from and
after the Effective Date, it shall be bound by the provisions of the Credit
Agreement as a Lender thereunder and, to the extent of the Assigned Interest,
shall have the obligations of a Lender thereunder, (iv) it has received a
copy of the Credit Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 5.01 thereof, as applicable, and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment and Assumption
and to purchase the Assigned Interest on the basis of which it has made such
analysis and decision independently and without reliance on the Administrative
Agent or any other Lender, and (v) if it is a Foreign Lender, attached to
the Assignment and Assumption is any documentation required to be delivered by
it pursuant to the terms of the Credit Agreement, duly completed and executed
by the Assignee; and (b) agrees that (i) it will, independently and
without reliance on the Administrative Agent, the Assignor or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Financing Documents, and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Financing
Documents are required to be performed by it as a Lender.


 


(c)           Payments.  From and after the Effective Date, the
Administrative Agent shall make all payments in respect of the Assigned
Interest (including payments of principal, interest, fees and other amounts) to
the Assignor for amounts which have accrued to but excluding the 


 

















 


Effective Date and to the
Assignee for amounts which have accrued from and after the Effective Date.


 


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


 

















 


EXHIBIT
C


 


FORM OF PROMISSORY NOTE


 


New York,
New York


December 16,
2009


 


FOR VALUE RECEIVED, the undersigned, Cubic
Corporation (the “Maker”), hereby promises to pay to the order of                     
(the “Lender”), at the office of JPMorgan Chase Bank, N.A. (the “Agent”),
at 277 Park Avenue, New York, New York at the expiration of the
Availability Period as defined in the First Amended and Restated Credit
Agreement, dated as of December 16, 2009, among the Maker, the Lenders
named therein and the Agent (as the same may be amended, modified or
supplemented from time to time in accordance with its terms, the “Credit
Agreement”) or earlier as provided for in the Credit Agreement, the aggregate
unpaid principal amount of all Revolving Loans (as defined in the Credit
Agreement) to the Maker from the Lender pursuant to the terms of the Credit
Agreement, in lawful money of the United States of America in immediately
available funds, and to pay interest from the date thereof on the principal
amount hereof from time to time outstanding, in like funds, at said office, at
a rate or rates per annum and, in each case, and payable on such dates as
determined pursuant to the terms of the Credit Agreement.


 


The Maker promises to pay interest, on
demand, on any overdue principal and fees and, to the extent permitted by law,
overdue interest from their due dates at a rate or rates determined as set
forth in the Credit Agreement.


 


The Maker hereby waives diligence,
presentment, demand, protest and notice of any kind whatsoever.  The non-exercise by the holder of any of its
rights hereunder in any particular instance shall not constitute a waiver
thereof in that or any subsequent instance.


 


All borrowings evidenced by this Promissory
Note and all payments and prepayments of the principal hereof and interest
hereon and the respective dates thereof shall be endorsed by the holder hereof
on the schedule attached hereto and made a part hereof, or on a continuation thereof
which shall be attached hereto and made a part hereof, or otherwise recorded by
such holder in its internal records; provided, however, that the
failure of the holder hereof to make such a notation or any error in such a
notation shall not in any manner affect the obligation of the Makers to make
payments of principal and interest in accordance with the terms of this
Promissory Note and the Credit Agreement.


 


This Promissory Note is one of the Notes
referred to in the Credit Agreement, which, among other things, contains
provisions for the acceleration of the maturity hereof upon the happening of
certain events, for optional and mandatory prepayment of the principal hereof
prior to the maturity hereof and for the amendment or waiver of certain provisions
of the Credit Agreement, all upon the terms and conditions therein
specified.  THIS
PROMISSORY NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK WITHOUT REGARD TO ANY CONFLICTS OF LAWS PRINCIPLES
THEREOF THAT WOULD CALL FOR THE APPLICATION OF THE LAWS OF ANY OTHER
JURISDICTION AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.


 


C-1

















 


	
   

  	
  CUBIC CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


C-2

















 


Loans and Payment


 


	
  Date

  	
   

  	
  Amount and 

  Type of Loan

  	
   

  	
  Payments

  Principal

  Interest

  	
   

  	
  Unpaid Principal

  Balance of Note

  	
   

  	
  Name of Person Making

  Notation

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


EXHIBIT D


 


AMENDED AND RESTATED SUBSIDIARY GUARANTEE


 


AMENDED AND RESTATED GUARANTEE dated as of December 16,
2009, by each of the signatories hereto (individually, a “Guarantor” and
collectively, the “Guarantors”), in favor of JPMorgan Chase Bank, N.A.,
a national banking association, as administrative agent (“Agent”) for (i) the
Lenders (the “Lenders”) named in Schedule 2.01 of the First Amended and
Restated Credit Agreement dated as of the date hereof, among Cubic Corporation
(the “Borrower”), the Agent and the Lenders (as amended, restated, modified
or supplemented from time to time in accordance with its terms, the “Credit
Agreement”; capitalized terms used herein and not otherwise defined herein
shall have the meanings attributed thereto in the Credit Agreement) and (ii) itself
as issuer of the Letters of Credit.


 


The Agent and the Lenders have agreed to
extend Loans and certain other financial accommodations to, including, without
limitation, the issuance of the Letters of Credit for the account of the
Borrower pursuant to, and subject to the terms and conditions of, the Credit
Agreement.  The obligation of the Lenders
to extend such Loans and of the Agent to issue the Letters of Credit under the
Credit Agreement is conditioned on the execution and delivery by the Guarantors
of a guarantee in the form hereof of the due and punctual payment and
performance of (a) the principal of and interest on the Loans, when and as
due, whether at maturity, by acceleration, upon one or more dates set for
prepayment or otherwise, (b) Indebtedness at any time and from time to
time under the Letters of Credit and (c) all other obligations of the
Borrower at any time and from time to time under the Credit Agreement and the
other Financing Documents (the foregoing collectively being herein referred to
as the “Guaranteed Obligations”).


 


The Guarantors are parties to that certain
Guarantee dated as of March 10, 2005 (the “Existing Guarantee”)
pursuant to which they guaranteed the obligations of the Borrower under the
credit agreement dated as of March 10, 2005 (the “Existing Credit
Agreement”).  The Existing Credit
Agreement is being amended and restated pursuant to the terms of the Credit
Agreement and, in connection therewith, the Guarantors have agreed to amend and
restate the Existing Guarantee.


 


Accordingly, in consideration of the premises
and in order to induce the Agent and the Lenders to make Loans and extend other
financial accommodations under the Credit Agreement, each Guarantor hereby,
jointly and severally, agrees that the Existing Guarantee shall be amended and
restated in its entirety as follows:


 


Section 1.  Guarantee.  Each Guarantor hereby, jointly and severally,
irrevocably and unconditionally, guarantees the punctual payment when due,
whether at stated maturity, by acceleration or otherwise, and the punctual
performance, of all present and future Guaranteed Obligations.  Each Guarantor also guarantees the full,
prompt and unconditional performance of all obligations and agreements of every
kind owed or hereafter to be owed by Borrower to the Agent or the Lenders under
the Credit Agreement and the other Financing Documents to which Borrower is a
party.


 

















 


Section 2.  Waiver.  Each Guarantor hereby absolutely,
unconditionally and irrevocably waives, to-the fullest extent permitted by law,
(i) promptness, diligence, notice of acceptance and any other notice with
respect to this Guarantee, (ii) presentment, demand of payment, protest,
notice of dishonor or nonpayment and any other notice with respect to the
Guaranteed Obligations, (iii) any requirement that the Agent or the
Lenders protect, secure, perfect or insure any security interest or Lien on any
property subject thereto or exhaust any right or take any action against the
Borrowers or any other Person or any collateral, and (iv) any other
action, event or precondition to the enforcement of this Guarantee or the
performance by each Guarantor of its obligations hereunder.


 


Section 3.  Guarantee Absolute.


 


(a)           This
Guarantee is one of payment and performance, not collection, and the
obligations of the Guarantors under this Guarantee are independent of the
obligations of the Borrower under the Credit Agreement and any other Financing
Document, and a separate action or actions may be brought and prosecuted
against each Guarantor to enforce this Guarantee, irrespective of whether any
action is brought against the Borrower or whether the Borrower is joined in any
such action or actions.


 


(b)           The
liability of the Guarantors under this Guarantee shall, to the fullest extent
permitted under applicable law, be absolute and unconditional irrespective of:


 


(i)            any invalidity,
irregularity, voidability, voidness or unenforceability of the Credit
Agreement, the Notes, or any other Financing Document or any other agreement or
instrument relating thereto, or of all or any part of the Guaranteed
Obligations or of any security therefor;


 


(ii)           any change in the
manner, place or terms of payment or performance, and/or any change or
extension of the time of payment or performance of, renewal or alteration of,
any Guaranteed Obligation, any security therefor, or any liability incurred
directly or indirectly in respect thereof, or any other amendment or waiver of
or any consent to departure from the Credit Agreement or the Notes or any other
Financing Document, including any increase in the Guaranteed Obligations
resulting from the extension of additional credit to the Borrower or any of its
Subsidiaries or otherwise;


 


(iii)          any sale, exchange,
release, surrender, realization upon any property by whomsoever at any time
pledged or mortgaged to secure, or howsoever securing, all or any of the
Guaranteed Obligations, and/or any offset against, or failure to perfect, or
continue the perfection of, any Lien in any such property, or delay in the
perfection of any such Lien, or any amendment or waiver of or consent to
departure from any other guaranty for all or any of the Guaranteed Obligations;


 


(iv)          any exercise or
failure to exercise any rights against the Borrower or others (including the
Guarantors);


 


(v)           any settlement or
compromise of any Guaranteed Obligation, any security therefor or any liability
(including any of those hereunder) incurred directly or indirectly in respect
thereof or hereof, and any subordination of the payment of all or any part 


 


2

















 


thereof to the payment of any Guaranteed
Obligation (whether due or not) of the Borrower to creditors of the Borrower
other than the Guarantors;


 


(vi)          any manner of
application of collateral, or proceeds thereof, to all or any of the Guaranteed
Obligations, or any manner of sale or other disposition of any collateral for
all or any of the Guaranteed Obligations or any other assets of the Borrower or
any of its Subsidiaries;


 


(vii)         any change,
restructuring or termination of the existence of any of the Borrower or any of
its Subsidiaries; or


 


(viii)        any other agreements
or circumstance of any nature whatsoever which might otherwise constitute a
defense available to, or a discharge of, this Guarantee and/or obligations of
the Guarantors hereunder, or a defense to, or discharge of, the Borrower or any
other Person or party relating to this Guarantee or the obligations of the
Guarantors hereunder or otherwise with respect to the Loans or Letters of
Credit extended to the Borrower, in each case other than the indefeasible
payment in full of the Guaranteed Obligations.


 


(c)           The
Agent may at any time and from time to time (whether or not after revocation or
termination of this Guarantee) without the consent of, or notice (except as
shall be required by applicable law that cannot be waived) to, the Guarantors,
and without incurring responsibility to the Guarantors or impairing or
releasing the obligations of the Guarantors hereunder, apply any sums by
whomsoever paid or howsoever realized to any Guaranteed Obligation regardless
of what Guaranteed Obligations remain unpaid.


 


(d)           This
Guarantee shall continue to be effective or be reinstated, as the case may be,
if claim is ever made upon the Agent or any Lender for repayment or recovery of
any amount or amounts received by the Agent or such Lender in payment or on
account of any of the Guaranteed Obligations and the Agent or such Lender
repays all or part of said amount by reason of any judgment, decree or order of
any court or administrative body having jurisdiction over the Agent or such
Lender or the respective property of each, or any settlement or compromise of
any such claim effected by the Agent or such Lender with any such claimant
(including the Borrower), the Guarantors shall be and remain liable to the
Agent or such Lender, as applicable, hereunder for the amount so repaid or
recovered to the same extent as if such amount had never originally been
received by the Agent or such Lender.


 


Section 4.  Continuing Guarantee.  This Guarantee is a continuing one and shall (i) remain
in full force and effect until the indefeasible payment and satisfaction in
full of the Guaranteed Obligations, (ii) be binding upon each Guarantor,
its successors and assigns, and (iii) inure to the benefit of, and be enforceable
by, the Agent and its successors, transferees and assigns.  All obligations to which this Guarantee
applies or may apply under the terms hereof shall be conclusively presumed to
have been created in reliance hereon.


 


Section 5.  Representations, Warranties and Covenants.  Each Guarantor hereby represents, warrants
and covenants to and with the Agent that:


 


3

















 


(a)           The
Guarantor has the power to execute and deliver this Guarantee and to incur and
perform its obligations hereunder;


 


(b)           The
Guarantor has duly taken all necessary action to authorize the execution,
delivery and performance of this Guarantee and to incur and perform its
obligations hereunder;


 


(c)           No
consent, approval, authorization or other action by, and no notice to or of, or
declaration or filing with, any governmental or other public body, or any other
Person, is required for the due authorization, execution, delivery and
performance by the Guarantor of this Guarantee or the consummation of the
transactions contemplated hereby;


 


(d)           The
execution, delivery and performance by the Guarantor of this Guarantee, do not
and will not violate or otherwise conflict with any term or provision of any
material agreement, instrument, judgment, decree, order or any statute, rule or
governmental regulation applicable to the Guarantor or result in the creation
of any Lien upon any of its properties or assets pursuant thereto;


 


(e)           This
Guarantee has been duly authorized, executed and delivered by the Guarantor and
constitutes the legal, valid and binding obligation of the Guarantor, and is
enforceable against the Guarantor in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or similar law
affecting creditors’ rights generally and general principles of equity
(regardless of whether such enforcement is sought in a proceeding in equity or
at law);


 


(f)            No
proceeding referred to in paragraph (g) or (h) of Article VII of
the Credit Agreement is pending against the Guarantor and no other event
referred to in such paragraphs (g) and (h) of such Article VII
has occurred and is continuing with respect to the Guarantor, and the property
of the Guarantor is not subject to any assignment for the benefit of creditors;
and


 


(g)           Each
Guarantor will take all necessary actions to comply with the provisions of the
Credit Agreement applicable to it.


 


Section 6.  Expenses.  The Guarantors will upon demand reimburse the
Agent for any sums, costs, and expenses which the Agent may pay or incur
pursuant to the provisions of this Guarantee or in negotiating, executing,
perfecting, defending, protecting or enforcing this Guarantee or in enforcing
payment of the Guaranteed Obligations or otherwise in connection with the
provisions hereof, including court costs, collection charges, travel expenses,
and reasonable attorneys’ fees, together with interest thereon as specified in Section 12
hereof.


 


Section 7.  Terms. 
(a) The words “include,” “includes” and “including” shall be deemed
to be followed by the phrase “without limitation”.


 


(b)           All
references herein to Sections and subsections shall be deemed to be references
to Sections and subsections of this Guarantee unless the context shall
otherwise require.


 


Section 8.  Amendments and Modification.  No provision hereof shall be modified,
altered or limited except by written instrument expressly referring to this
Guarantee and to such provision, and executed by the party to be charged.


 


4

















 


Section 9.  Subrogation.  Upon making full payment with respect to any
Guaranteed Obligation hereunder, the Guarantors shall be subrogated to the
rights of the payee against the Borrower with respect to such obligation;
provided that the Guarantors shall not enforce any payment by way of
subrogation so long as any Lender has any Commitment under the Credit
Agreement, any Letter of Credit shall remain outstanding or any Guaranteed
Obligation remains unpaid.


 


Section 10.  Remedies Upon Default; Right of Set-Off.  (a)  Upon the occurrence and during the
continuance of any Event of Default, the Agent may, without notice to or demand
upon the Borrower or the Guarantors, declare any Guaranteed Obligations
immediately due and payable, and shall be entitled to enforce the obligations
of the Guarantor hereunder.


 


(b)           Upon
such declaration by the Agent, the Agent and any Lender 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 indebtedness at any time owing
by the Agent or any Lender to or for the credit or the account of any Guarantor
against any and all of the obligations of such Guarantor now or hereafter
existing under this Guarantee that are then due, whether or not the Agent or
such Lender shall have made any demand under this Guarantee.  The Agent agrees promptly to notify such
Guarantor after any such set-off and application, provided that the failure to
give such notice shall not affect the validity of such set-off and
application.  The rights of the Agent and
Lenders under this Section 10 are in addition to other rights and remedies
(including other rights of set-off) which the Agent and Lenders may have.


 


Section 11.  Statute of Limitations.  Any acknowledgment or new promise, whether by
payment of principal or interest or otherwise and whether by the Borrower or
others (including any Guarantor), with respect to any of the Guaranteed
Obligations shall, to the fullest extent permitted under applicable law, if the
statute of limitations in favor of the Guarantors against the Agent or Lenders
shall have commenced to run, toll the running of such statute of limitations
and, if the period of such statute of limitations shall have expired, prevent
the operation of such statute of limitations.


 


Section 12.  Interest.  All amounts payable from time to time by the
Guarantors hereunder shall bear interest at an interest rate per annum
determined in accordance with Section 2.12 of the Credit Agreement as if
such amounts were payable by the Borrower.


 


Section 13.  Rights and Remedies Not Waived.  No act, omission or delay by the Agent shall
constitute a waiver of its rights and remedies hereunder or otherwise.  No single or partial waiver by the Agent of
any default hereunder or right or remedy which it may have shall operate as a
waiver of any other default, right or remedy or of the same default, right or
remedy on a future occasion.


 


Section 14.  Admissibility of Guarantee.  The Guarantors agree that any copy of this
Guarantee signed by the Guarantors and transmitted by telecopier for delivery
to the Agent shall be admissible in evidence as the original itself in any
judicial or administrative proceeding, whether or not the original is in
existence.


 


5
















 


Section 15.  Notices.  All notices, requests and demands to or upon
the Agent or the Guarantors under this Agreement shall be in writing and given
as provided in the Credit Agreement (with respect to the Guarantors, to the
address of the Borrower as set forth in the Credit Agreement).


 


Section 16.  Counterparts.  This Guarantee may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original and all of
which shall together constitute one and the same agreement.  Delivery of an executed counterpart of a
signature page of this Guarantee by telecopy shall be effective as
delivery of a manually executed counterpart of this Guarantee.


 


Section 17.  CONSENT TO JURISDICTION; WAIVER OF JURY
TRIAL ETC.  (a) EACH GUARANTOR
HEREBY SUBMITS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, TO THE NONEXCLUSIVE JURISDICTION OF THE SUPREME COURT OF THE
STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND ANY APPELLATE COURT THEREFROM IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.  EACH GUARANTOR HEREBY IRREVOCABLY WAIVES, IN
CONNECTION WITH ANY SUCH ACTION OR PROCEEDING, (i) TRIAL BY JURY, (ii) TO
THE EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM
NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
SUCH ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS AND (iii) THE
RIGHT TO INTERPOSE ANY SET-OFF, COUNTERCLAIM OR CROSS-CLAIM (UNLESS SUCH
SET-OFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE
FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY
OTHER ACTION).


 


(b)           Each
Guarantor irrevocably consents to the service of process of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by certified mail, postage prepaid, to such Guarantor at its address
determined pursuant to Section 15 hereof.


 


(c)           Nothing
herein shall affect the right of the Agent to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise proceed against
any Guarantor in any other jurisdiction.


 


(d)           Each
Guarantor hereby waives presentment, notice of dishonor and protests of all
instruments included in or evidencing any of the Guaranteed Obligations, and
any and all other notices and demands whatsoever (except as expressly provided
herein).


 


Section 18.  GOVERNING LAW.  THIS GUARANTEE SHALL BE CONSTRUCTED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO ANY CONFLICTS OF LAWS 


 


6

















 


PRINCIPLES THEREOF THAT
WOULD CALL FOR THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION.


 


Section 19.  Captions; Separability.  (a) The captions of the Sections and
subsections of this Guarantee have been inserted for convenience only and shall
not in any way affect the meaning or construction of any provision of this
Guarantee.


 


(b)           If
any term of this Guarantee shall be held to be invalid, illegal or
unenforceable, the validity of all other terms hereof shall in no way be
affected thereby.


 


Section 20.  Enforcement.  If, in any action to enforce this Guarantee
or any proceeding to allow or adjudicate a claim under this Guarantee, a court
of competent jurisdiction determined that enforcement of this Guarantee against
any Guarantor for the full amount of the Guaranteed Obligations is not lawful
under, or would be subject to avoidance under, Section 548 of the United
States Bankruptcy Code or any applicable provision of comparable state law, the
liability of such Guarantor under this Guarantee shall be limited to the
maximum amount lawful and not subject to avoidance under such law.


 


Section 21.  Contribution.  Each Guarantor agrees that in the event a
payment shall be made by any Guarantor (the “Claiming Guarantor”) under
this Guarantee or assets of such Claiming Guarantor shall be sold pursuant to
any mortgage, security agreement or similar instrument or agreement to satisfy
a claim of the Lenders or the Agent, each other Guarantor (a “Contributing
Guarantor”) shall indemnify the Claiming Guarantor in an amount equal to
the amount of such payment or the greater of the book value or the fair market
value of such assets, as the case may be, multiplied by a fraction of which the
numerator shall be the net worth of the Contributing Guarantor on the date hereof
and the denominator shall be the aggregate net worth of all Guarantors on the
date hereof.


 


Section 22.  Acknowledgment of Receipt.  Each Guarantor acknowledges receipt of a copy
of this Guarantee and each of the Financing Documents.


 


[Remainder of Page Intentionally Left Blank]


 


7

















 


IN WITNESS WHEREOF, each Guarantor has duly
executed or caused this Guarantee to be duly executed in the State of New York
as of the date first above set forth.


 


	
   

  	
  CUBIC
  TRANSPORTATION SYSTEMS, INC., a California corporation

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:
  William L. Hoese

  
	
   

  	
  Title:
  Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CUBIC
  APPLICATIONS, INC., a California corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:
  William L. Hoese

  
	
   

  	
  Title:
  Secretary

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CUBIC
  DEFENSE APPLICATIONS, INC., a California corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:
  William L. Hoese

  
	
   

  	
  Title:
  Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CUBIC
  SIMULATION SYSTEMS, INC., a California corporation

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:
  William L. Hoese

  
	
   

  	
  Title:
  Secretary

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  OMEGA
  TRAINING GROUP, INC., a Georgia corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:
  William L. Hoese

  
	
   

  	
  Title: Secretary

  



 


8

















 


EXHIBIT E


 


FORM OF COMPLIANCE CERTIFICATE


 


CUBIC CORPORATION

OFFICER’S CERTIFICATE


 


In Conformance with the First Amended and Restated
Credit Agreement Dated

December 16, 2009

As of and for the Period
Ending           .


 


The following certification is provided to the
Lenders as required under Section 5.02 of the First Amended and
Restated Credit Agreement dated December 16, 2009 (the Agreement).  The undersigned hereby certifies that:


 


a.                                       the Borrower
was in compliance with the requirements of Section 6.01 through 6.05
and 6.10 of the Agreement, inclusive, during the period covered by the
accompanying financial statements (detailed calculations of financial covenant
compliance annexed), and


 


b.                                      the undersigned
has reviewed the terms of the Agreement and has made, or caused to be made
under his or her supervision, a review of the transactions and conditions of
the Borrower and its Subsidiaries from the beginning of the period covered by
the accompanying financial statements to the date of this certificate, and that
such review (i) has not disclosed the existence during such period of any
condition or event that constitutes a Default as defined in the Agreement and (ii) has
confirmed that Unrestricted Subsidiaries continue to constitute, in aggregate,
less than 7% of Consolidated Total Capitalization.


 


Dated at San Diego, California, this
         day of
                        ,
        .


 


 


	
   

  	
   

  
	
  Name:

  	
   

  
	
  Title:

  	
   

  



 

















 


For the Quarter/Year ended
                  
(“Statement Date”)


 


SCHEDULE 1

to the Compliance Certificate

($ in 000’s)


 


	
  I. Section 6.01(a) – Consolidated EBITDA
  to Consolidated Cash Interest Expense.

  	
   

  	
   

  
	
  A.   Consolidated EBITDA for four consecutive fiscal quarters ending
  on above date (“Subject Period”) as set forth on Schedule 2:

  	
   

  	
  $

  
	
  B.    Consolidated
  Cash Interest Expense for the Subject Period:

  	
   

  	
  $

  
	
  C.    Consolidated
  EBITDA to Consolidated Cash Interest Expense (Line I.A ÷ Line I.B):

  	
   

  	
  $

  
	
  Minimum required: 3.00 to 1.00

  	
   

  	
   

  
	
  II. Section 6.01(b) – Consolidated
  Indebtedness to Consolidated Adjusted EBITDA.

  	
   

  	
   

  
	
  A.    Consolidated
  Indebtedness at Statement Date as set forth on Schedule 2:

  	
   

  	
  $

  
	
  B.    Consolidated
  EBITDA for the Subject Period as set forth on Schedule 2:

  	
   

  	
  $

  
	
  C.    EBITDA
  of any Person which becomes a Restricted Subsidiary during the Subject
  Period:

  	
   

  	
  $

  
	
  D.    Consolidated
  Indebtedness to Consolidated Adjusted EBITDA (Line II.A ÷ Line II.B
  + Line II.C):

  	
   

  	
  $

  
	
  Maximum permitted: 3.00 to 1.00

  	
   

  	
   

  



 


10

















 


SCHEDULE 2

to the Compliance Certificate

($ in 000’s)


 


Consolidated EBITDA

(in accordance with the definition of Consolidated EBITDA as set forth in the
Agreement)


 


	
  EBITDA

  	
   

  	
  Quarter

  Ended

  	
   

  	
  Quarter

  Ended

  	
   

  	
  Quarter

  Ended

  	
   

  	
  Quarter
  Ended

  	
   

  	
  Twelve

  Months

  Ended

  	
   

  
	
  Net Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  - interest income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + Consolidated Interest Expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + net income taxes

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + depreciation expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + amortization expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + non-cash stock option expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  + non-cash losses

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  - non-cash gains

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  = EBITDA

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


Consolidated Indebtedness

(in accordance with the definition of Consolidated Indebtedness 

as set forth in the Credit Agreement)


 


	
  Liabilities for borrowed money

  	
   

  	
  $

  	
   

  
	
  + liabilities for deferred purchase prices of
  property

  	
   

  	
  $

  	
   

  
	
  + liabilities for Capital Leases

  	
   

  	
  $

  	
   

  
	
  + liabilities for letters of credit

  	
   

  	
  $

  	
   

  
	
  + Swaps

  	
   

  	
  $

  	
   

  
	
  + Guarantees of any of the foregoing (without
  duplication)

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Consolidated Indebtedness

  	
   

  	
  $

  	
   

  



 


11