exv4w5






Exhibit 4.5




EXECUTION VERSION




INTERCREDITOR AGREEMENT




     This Intercreditor Agreement is dated as of February 8, 2010, and entered into by and among
Libbey Glass Inc., a Delaware corporation (the “Company”), Libbey Inc., a Delaware
corporation (“Holdings”), the Subsidiaries of the Company listed on the signature pages
hereof (together with any subsidiary that becomes a party hereto after the date hereof, the
“Company Subsidiaries”), JP Morgan Chase Bank, N.A., in its capacity as administrative
agent under the Initial ABL Loan Agreement, including its successors and assigns from time to time
(the “Initial ABL Agent”) and The Bank of New York Mellon Trust Company, N.A., as Trustee
including, its successors and assigns from time to time (the “Notes Trustee”), not in its
individual capacity, but solely in its capacity as trustee and collateral agent under the Notes
Indenture. Capitalized terms used in this Agreement have the meanings assigned to them in
Section 1.



RECITALS




     The Company, Libbey Europe B.V., Holdings, the other Loan Parties party thereto, the ABL
Lenders, the Initial ABL Agent and JPM Morgan Europe Limited, as administrative agent with respect
to Netherlands Loans, have entered into that certain Amended and Restated Credit Agreement, dated
as of February 8, 2010 (as amended, restated, supplemented or modified from time to time, the
“Initial ABL Loan Agreement”);



     The Company has issued, or will issue, $400,000,000 principal amount of 10% senior secured
notes due 2015 (the “Initial Notes”) under an indenture, dated as of February 8, 2010 (as
amended, restated, supplemented or modified from time to time, the “Notes Indenture”) among
the Company, Holdings, Subsidiary Guarantors (as defined in the Notes Indenture), and the Notes
Trustee;



     The Company may from time to time following the date hereof issue Additional Pari Passu
Secured Indebtedness Obligations to the extent permitted by the ABL Loan Agreement and the Notes
Indenture;



     In order to induce the Initial ABL Agent and the ABL Lenders to consent to the Grantors
incurring the Notes Obligations and granting Liens to the Notes Agent and in order to induce the
Notes Agent and the Noteholders to consent to the Grantors incurring the ABL Obligations and
granting Liens to the the Initial ABL Agent, Initial ABL Agent, on behalf of the ABL Claimholders,
and the Notes Agent, on behalf of the Notes Claimholders, have agreed to the relative priority of
their respective Liens on the Collateral and certain other rights, priorities and interests as set
forth in this Agreement.



AGREEMENT




     In consideration of the foregoing, the mutual covenants and obligations herein set forth and
for other good and valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:



I.

DEFINITIONS.




     1.1. Defined Terms. As used in this Agreement, the following terms shall have the
following meanings:



 









 





     “ABL Agent” means the Initial ABL Agent and any successor or other agent under any ABL
Loan Agreement.



     “ABL Claimholders” means, at any relevant time, the holders of ABL Obligations at that
time, including, without limitation, the ABL Lenders and the ABL Agent under the ABL Loan Agreement
and the Bank Product Providers in each case solely in their capacities as such and not in any other
capacity (except to the extent that such ABL Claimholder is acting in such other capacity for the
primary purpose of benefiting its ABL Obligations).



     “ABL Collateral” means all of the assets and property of any Grantor, whether real,
personal or mixed, with respect to which a Lien is granted as security for any ABL Obligations.



     “ABL Default” means an “Event of Default” (as defined in the ABL Loan Agreement).



     “ABL Lenders” means the “Lenders” under and as defined in the ABL Loan Agreement or
any other Person which extends credit under the ABL Loan Agreement in each case solely in their
capacities as such and not in any other capacity (except to the extent that such ABL Lender is
acting in such other capacity for the primary purpose of benefiting its ABL Obligations).



     “ABL Loan Agreement” means collectively, (a) the Initial ABL Loan Agreement and (b)
any other credit agreement or credit agreements, one or more debt facilities, and/or commercial
paper facilities, in each case, with banks or other institutional or commercial lenders providing
for revolving credit loans, term loans, receivables financing (including through the sale of
receivables to such lenders or to special purpose entities formed to borrow from (or sell such
receivables to) such lenders against such receivables), letters of credit, bankers’ acceptances, or
other borrowings, that has been incurred to increase, replace (whether upon or after termination or
otherwise), refinance or refund in whole or in part from time to time the Obligations outstanding
under the Initial ABL Loan Agreement or any other agreement or instrument referred to in this
clause which (I) is designated to each then existing ABL Agent as an “ABL Loan Agreement” by (x)
if any other ABL Loan Agreement is then in effect, the ABL Agent thereunder (and, so long as an
ABL Default has not occurred and is continuing at the time of such designation, the Company) or (y)
if no other ABL Loan Agreement is then in effect, the Company, and (II) the ABL Agent for such
agreement shall have executed a supplement to this Agreement agreeing to be bound hereby on the
same terms applicable to the Initial ABL Agent, whether or not such increase, replacement,
refinancing or refunding occurs (i) with the original parties thereto, (ii) on one or more separate
occasions or (iii) simultaneously or not with the termination or repayment of the Initial ABL Loan
Agreement or any other agreement or instrument referred to in this clause, unless such agreement or
instrument is not a Permitted Refinancing Agreement. Any reference to the ABL Loan Agreement
hereunder shall be deemed a reference to any ABL Loan Agreement then in existence.



     “ABL Loan Documents” means the ABL Loan Agreement and the “Loan Documents” (as
defined in the ABL Loan Agreement), Bank Products, and each of the other agreements, documents and
instruments executed pursuant thereto, and any other document or instrument executed or delivered
at any time in connection with the ABL Loan Agreement or any Bank Products, including any
intercreditor or joinder agreement among holders of ABL Obligations, to the extent such are
effective at the relevant time, as
each may be amended, restated, supplemented, modified, renewed, extended or Refinanced from
time to time in accordance with the provisions of this Agreement.



     “ABL Mortgages” means a collective reference to each mortgage, deed of trust and other
document or instrument under which any Lien on real property owned or leased by any Grantor is
granted to secure any ABL Obligations or under which rights or remedies with respect to any such
Liens are governed.



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     “ABL Obligations” means all Obligations outstanding under the ABL Loan Agreement and
the other ABL Loan Documents, including any Bank Products. “ABL Obligations” shall include
all interest accrued or accruing (or which would, absent commencement of an Insolvency or
Liquidation Proceeding, accrue) after commencement of an Insolvency or Liquidation Proceeding in
accordance with the rate specified in the relevant ABL Loan Document whether or not the claim for
such interest is allowed as a claim in such Insolvency or Liquidation Proceeding.



     “ABL Priority Collateral” means all now-owned or hereafter acquired ABL Collateral
that constitutes:




     (a) Accounts, other than Accounts which arise from the sale, license, assignment or
other disposition of Notes Priority Collateral;




     (b) Inventory and Documents for any Inventory;




     (c) all Intellectual Property;




     (d) Capital Stock of the Company held by Libbey Inc.;




     (e) Capital Stock held by the Company or any Subsidiary Guarantor (which in the case of
an equity interest in any Foreign Subsidiary (as defined in the Notes Indenture), will be
limited to 100% of the non-voting stock (if any) and 65% of the voting stock of direct
wholly-owned Foreign Subsidiaries;




     (f) Deposit Accounts and Securities Accounts (including all cash, cash equivalents,
Money, checks, Instruments, funds, ACH transfers, wired funds, Investment Property, and
other funds and property held in or on deposit in any of the foregoing, but excluding any
identifiable Proceeds of Notes Priority Collateral held in any of the foregoing);




     (g) Letter of Credit Rights arising out of, or related to, or derivative of any of the
property or interests in property described in this definition;




     (h) letters of credit transferred to the ABL Agent or any ABL Lender, or with respect
to which the Proceeds thereof have been assigned to the ABL Agent or any ABL Lender, or on
which the ABL Agent or any ABL Lender is named as beneficiary, in each case arising out of,
related to, or derivative of the property or interests described in this definition;




     (i) Supporting Obligations and Commercial Tort Claims, in each case, to the extent
arising out of, or related to, or derivative of the property or interests in property
described in this definition;




     (j) all contracts, contract rights, other General Intangibles, Chattel Paper, and
Instruments (including promissory notes), in each case, to the extent arising out of, or
related to, or derivative of the property or interests in property described in this
definition;




     (k) all General Intangibles (other than Notes General Intangibles);




     (l) all Investment Property;




     (m) all books and Records relating to the items referred to in the preceding clauses
(a) through (n) (including all books, databases, data processing software, customer lists,
engineer



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drawings, and Records, whether tangible or electronic, which contain any
information relating to any of the items referred to in the preceding clauses (a) through
(n)); and




     (n) all collateral security and guarantees with respect to any of the foregoing and,
subject to Section 3.5, all proceeds, products, substitutions, replacements,
accessions, cash, Money, insurance proceeds, Instruments, Securities, Security Entitlements,
Financial Assets and Deposit Accounts (except Deposit Accounts containing identifiable Notes
Priority Proceeds under clause (g) of the definition of “Notes Priority Collateral”, but
only to the extent of such identifiable Notes Priority Proceeds) received as proceeds of any
of the foregoing, but excluding identifiable proceeds from Notes Priority Collateral
(collectively, “ABL Priority Proceeds”).


For purposes of clarification, and notwithstanding anything to the contrary set forth in this
Agreement, any of the items set forth in this paragraph that are or become branded, or otherwise
produced through the use or other application of, any Trademarks or other Intellectual Property,
whether pursuant to the exercise of rights pursuant to Section 3.4 or otherwise, shall
fully constitute ABL Priority Collateral, and no Proceeds arising from any Disposition of any such
ABL Priority Collateral shall be, or be deemed to be, attributable to Notes Priority Collateral.




     For the avoidance of doubt, it is hereby acknowledged and agreed that the Notes will not be
secured by a Lien on or security interest in any assets or property of any Foreign Subsidiary
(regardless of whether such assets or property are or have been pledged to the ABL Agent under the
ABL Loan Agreement) and nothing in this Agreement shall be deemed to grant any rights to the Notes
Trustee in respect of such assets or property.



     “ABL Security Documents” means any agreement, document or instrument pursuant to which
a Lien is granted securing any ABL Obligations or under which rights or remedies with respect to
such Liens are governed.



     “Access Period” means for each parcel of Mortgaged Premises or other Notes Priority
Collateral, the period, which begins on the earlier of (a) the day on which the ABL Agent provides
the Notes Agent with an Enforcement Notice and (b) the fifth Business Day after the Notes Agent
provides the ABL Agent with notice that the Notes Agent (or its agent) has obtained possession or
control of such Mortgaged Premises or other Notes Priority Collateral in connection with an
Enforcement and ends on the earliest of (i) the 180th day after the date (the “Initial Access
Date”) on which the ABL Agent initially obtains the ability to take physical possession of,
remove, or otherwise control physical access to, or actually uses, the applicable ABL Collateral
plus such number of days, if any, after the Initial Access Date that it is stayed or otherwise
prohibited by law or court order from exercising remedies with respect to ABL Priority Collateral
and (ii) the Discharge of ABL Obligations.



     “Account Agreements” means any lockbox account agreement, pledged account agreement,
blocked account agreement, securities account control agreement, or any similar deposit or
securities account agreements among the Notes Agent and/or the ABL Agent, one or more Grantors and the
relevant financial institution depository or securities intermediary.



     “Accounts” means all present and future “accounts” (as defined in Article 9 of the
UCC).



     “Additional Joinder Agreement” shall mean a joinder agreement in the form of Exhibit B
hereto.



     “Additional Pari Passu Secured Indebtedness Agent” means the Person appointed to act
as trustee, agent or representative for the holders of Additional Pari Passu Secured Indebtedness
Obligations pursuant to any Additional Pari Passu Secured Indebtedness Agreement.



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     “Additional Pari Passu Secured Indebtedness Agreement” means the indenture, credit
agreement or other agreement under which any Additional Pari Passu Secured Indebtedness Obligations
are incurred.



     “Additional Pari Passu Secured Indebtedness Obligations” means Indebtedness of the
Grantors issued following the date of this Agreement to the extent (a) such Indebtedness is not
prohibited by the terms of the ABL Loan Agreement and the Notes Indenture, from being incurred or
from being secured by Liens on the Collateral ranking pari passu with the Liens
securing the Notes Obligations, (b) the Grantors have granted Liens, consistent with clause (a), on
the Collateral to secure the obligations in respect of such Indebtedness, and (c) the Additional
Pari Passu Secured Indebtedness Agent, for the holders of such Indebtedness has entered into an
Additional Joinder Agreement on behalf of the Notes Claimholders under such agreement acknowledging
that such holders shall be bound by the terms hereof applicable to Notes Claimholders.



     “Affiliate” means, with respect to a specified Person, another Person that directly,
or indirectly through one or more intermediaries, controls or is controlled by or is under common
control with the Person specified. For purposes of this definition, a Person shall be deemed to
“control” or be “controlled by” a Person if such Person possesses, directly or
indirectly, power to direct or cause the direction of the management or policies of such Person
whether through ownership of equity interests, by contract or otherwise.



     “Agents” means the ABL Agent and the Notes Agent.



     “Agreement” means this Intercreditor Agreement, as amended, restated, renewed,
extended, supplemented or otherwise modified from time to time.



     “Bank Product Debt” means Indebtedness and other Obligations relating to Bank
Products.



     “Bank Product Provider” means any ABL Lender or Affiliate of an ABL Lender that is
providing Banking Services (as such term is defined in the Initial ABL Loan Agreement or any
substantially equivalent term in any other ABL Loan Agreement) to any Grantor or that is a party to
a Swap Agreement (as such term is defined in the Initial ABL Loan Agreement or any substantially
equivalent term in any other ABL Loan Agreement) with any Grantor.



     “Bank Products” means any Swap Agreement evidencing Swap Obligations (as each such
term is defined in the Initial ABL Loan Agreement or any substantially equivalent term in any other
ABL Loan Agreement) or agreement evidencing Banking Services Obligations (as such term is defined
in the Initial ABL Loan Agreement or any substantially equivalent term in any other ABL Loan
Agreement).



     “Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy,” as
now and hereafter in effect, or any successor statute.



     “Bankruptcy Law” means the Bankruptcy Code and any similar federal or state law for
the relief of debtors.



     “Business Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in New York City, Chicago, Illinois or Wilmington, Delaware are authorized or
required by law to close.



     “Capital Stock” means (a) in the case of a corporation, capital stock, (b) in the case
of an association or business entity, any and all shares, interests, participations, rights or
other equivalents (however designated) of capital stock, (c) in the case of a partnership,
partnership interests (whether general or



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limited), (d) in the case of a limited liability company,
membership interests and (e) any other interest or participation that confers on a Person the right
to receive a share of the profits and losses of, or distributions of assets of, the issuing Person
and all rights, warrants or options exchangeable for or convertible into any of the items described
in clauses (a) through (e) above; provided that with respect to the foregoing, Capital
Stock shall exclude any debt securities convertible into Capital Stock, whether or not such debt
securities include any right of vote or participation with Capital Stock.




     “Chattel Paper” means all present and future “chattel paper” (as defined in Article 9
of the UCC).



     “Claimholder” means any Notes Claimholder or ABL Claimholder, as applicable.



     “Collateral” means any and all of the assets and property of any Grantor, whether
real, personal or mixed, which constitute ABL Collateral or Notes Collateral.



     “Commercial Tort Claims” means all present and future “commercial tort claims” (as
defined in Article 9 of the UCC).



     “Company” has the meaning assigned to that term in the Preamble to this Agreement.



     “Company Subsidiary” has the meaning assigned to that term in the Preamble to this
Agreement.



     “Conforming Plan of Reorganization” means any Plan of Reorganization whose provisions
are consistent with the provisions of this Agreement.



     “Deposit Accounts” means all present and future “deposit accounts” (as defined in
Article 9 of the UCC).



     “DIP Financing” has the meaning assigned to that term in Section 6.1.



     “Discharge of ABL Obligations” means, except to the extent otherwise expressly
provided in Section 5.5:




     (a) payment in full in cash of all ABL Obligations (other than (i) Bank Product Debt
which is not then due and payable except as provided in clause (c) below and (ii) contingent
obligations or contingent indemnification obligations except as provided in clause (e)
below);




     (b) termination or expiration of all commitments, if any, to extend credit under the
ABL Loan Documents;




     (c) termination and payment in full in cash or cash collateralization (in an amount and
manner reasonably satisfactory to the ABL Agent) of all Bank Product Debt;




     (d) termination, cash collateralization (in an amount and manner reasonably
satisfactory to the ABL Agent, but in no event greater than 105% of the aggregate undrawn
face amount, plus commissions, fees, and expenses) or backstop of all letters of credit
issued under the ABL Loan Agreement in compliance with the terms of the ABL Loan Agreement;
and




     (e) cash collateralization (or support by a letter of credit) for any costs, expenses
and contingent indemnification obligations included in the ABL Obligations that are not yet
due and payable but with respect to which a claim has been asserted in writing under any ABL
Loan Documents (in an amount and manner reasonably satisfactory to the ABL Agent).



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     “Discharge of Prior Lien Obligations” shall mean:




     (a) with respect to the ABL Priority Collateral as it relates to the Notes
Claimholders, the Discharge of ABL Obligations; and




     (b) with respect to the Notes Priority Collateral as it relates to the ABL
Claimholders, the Discharge of Notes Obligations.



     “Discharge of Notes Obligations” means, except to the extent otherwise expressly
provided in Section 5.5, (x) payment in full in cash of all Notes Obligations (other than
contingent obligations or indemnification obligations, in each case for which no claim has been
asserted) or (y) any discharge or legal defeasance of the Notes Indenture and each Additional Pari
Passu Secured Indebtedness Agreement in accordance with the express terms thereof.



     “Disposition” means any sale, lease, exchange, transfer or other disposition of any
Collateral.



     “Documents” means all present and future “documents” (as defined in Article 9 of the
UCC.



     “Enforcement” means, collectively or individually for one or both of the ABL Agent or
any ABL Claimholder or the Notes Agent or any Note Claimholder to enforce or attempt to enforce any
right or power to repossess, replevy, attach, garnish, levy upon, collect the Proceeds of,
foreclose or realize in any manner whatsoever its Lien upon, sell, liquidate or otherwise dispose
of, or otherwise restrict or interfere with the use of, or exercise any remedies with respect to,
any Collateral, whether by judicial enforcement of any of the rights and remedies under the ABL
Loan Documents, the Notes Documents and/or under any applicable law, by self-help repossession, by
non-judicial foreclosure sale, lease, or other disposition, by set-off, by notification to account
obligors of any Grantor, by any sale, lease, or other disposition implemented by any Grantor at the
direction of the ABL Agent or the Notes Agent, or otherwise, but in all cases excluding (i) the
establishment of borrowing base reserves, collateral ineligibles, or other conditions for advances,
(ii) the changing of advance rates or advance sublimits, (iii) the imposition of a default rate or
late fee, (iv) the collection and application (including pursuant to “cash dominion” provisions) of
Accounts or other monies deposited from time to time in Deposit Accounts or Securities Accounts, in
each case, against the ABL Obligations pursuant to the provisions of the ABL Loan Documents
(including, without limitation, the notification of account debtors, depositary institutions or any
other Person to deliver proceeds of Collateral to the ABL Agent), (v) the cessation of lending
pursuant to the provisions of the ABL Loan Documents, including upon the occurrence of a default
due to the existence of an over-advance, (vi) the filing of a proof of claim in any Insolvency or
Liquidation Proceeding, (vii) the consent by the ABL Agent to disposition by any Grantor of any of
the ABL Priority Collateral, and (viii) the acceleration of the Notes Obligations or the ABL
Obligations.



     “Enforcement Notice” means a written notice delivered, at a time when an ABL Default
or Notes Default has occurred and is continuing, by either the ABL Agent or the Notes Agent to the
other announcing that such party intends to commence Enforcement against its Priority Collateral and
specifying the ABL Event of Default or Notes Event of Default, as applicable.



     “Equipment” means all now owned and hereafter acquired equipment, as defined in
Article 9 of the UCC.



     “Financial Assets” means all present and future “financial assets” (as defined in
Article 9 of the UCC).



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     “General Intangibles” means all present and future “general intangibles” (as defined
in Article 9 of the UCC).



     “Governmental Authority” means any federal, state, municipal, national or other
government, governmental department, commission, board, bureau, court, agency or instrumentality or
political subdivision thereof or any entity or officer exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to any government or any court, in each
case whether associated with a state of the United States, the United States, or a foreign entity
or government.



     “Grantors” means Holdings, the Company, each Company Subsidiary and each other Person
that has or may from time to time hereafter execute and deliver an ABL Security Document or a Notes
Security Document, as a grantor of a Lien (or the equivalent thereof).



     “Indebtedness” means and includes all “Indebtedness,” or any similar term within the
meaning of the ABL Loan Agreement or the Notes Indenture, as applicable.



     “Initial ABL Loan Agreement” has the meaning assigned to that term in the Recitals.



     “Initial Access Date” has the meaning assigned to that term in the definition of the
term “Access Period.”



     “Initial Notes” has the meaning assigned to that term in the Recitals.



     “Insolvency or Liquidation Proceeding” means:




     (a) any voluntary or involuntary case or proceeding under the Bankruptcy Code with
respect to any Grantor;




     (b) any other voluntary or involuntary insolvency, reorganization or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar case or
proceeding with respect to any Grantor or with respect to a material portion of their
respective assets;




     (c) any composition of liabilities or similar arrangement relating to any Grantor,
whether or not under a court’s jurisdiction or supervision;




     (d) any liquidation, dissolution, reorganization or winding up of any Grantor, whether
voluntary or involuntary, whether or not under a court’s jurisdiction or supervision, and
whether or not involving insolvency or bankruptcy; or




     (e) any general assignment for the benefit of creditors or any other marshalling of
assets and liabilities of any Grantor.




     “Instruments” means all present and future “instruments” (as defined in Article 9 of
the UCC).



     “Intellectual Property” means, all of the following in any jurisdiction throughout the
world: (a) patents, patent applications and inventions, including all renewals, extensions,
combinations, divisions, or reissues thereof, (“Patents”); (b) trademarks, service marks,
trade names, trade dress, logos, internet domain names and other business identifiers, together
with the goodwill symbolized by any of the foregoing, and all applications, registrations, renewals
and extensions thereof, (“Trademarks”); (c) copyrights and all works of authorship
including all registrations, applications, renewals, extensions and reversions thereof,
(“Copyrights”); (d) all computer software, source code, executable code, data, databases



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and documentation thereof; (e) all trade secret rights in information, including trade secret
rights in any formula, pattern, compilation, program, device, method, technique, or process, that
(1) derives independent economic value, actual or potential, from not being generally known to, and
not being readily ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use, and (2) is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy; (f) all other intellectual property or proprietary rights in
any discoveries, concepts, ideas, research and development, know-how, formulae, patterns,
inventions, compilations, compositions, manufacturing and production processes and techniques,
program, device, method, technique, technical data, procedures, designs, recordings, graphs,
drawings, reports, analyses, specifications, databases, and other proprietary or confidential
information, including customer lists, supplier lists, pricing and cost information, business and
marketing plans and proposals and advertising and promotional materials; and (g) all rights to sue
at law or in equity for any infringement or other impairment or violation thereof and all products
and proceeds of the foregoing.




     “Inventory” means all now owned and hereafter existing or acquired inventory, as
defined in Article 9 of the UCC.



     “Investment Property” means all present and future “investment property” (as defined
in Article 9 of the UCC), including, without limitation, all Capital Stock of all Grantors (other
than Holdings) and all Subsidiaries of the Grantors.



     “Letter of Credit Rights” means all present and future “letter of credit rights” (as
defined in Article 9 of the UCC).



     “Lien” means any mortgage, pledge, hypothec, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security interest or any other
security agreement (including, without limitation, any conditional sale or other title retention
agreement and any capital lease having substantially the same economic effect as any of the
foregoing).



     “Money” means all present and future “money” (as defined in Article 9 of the UCC).



     “Mortgaged Premises” means any real property which shall now or hereafter be subject
to a Notes Mortgage and/or an ABL Mortgage.



     “New Agent” has the meaning assigned to that term in Section 5.5.



     “New Debt Notice” has the meaning assigned to that term in Section 5.5.



     “Non-Conforming Plan of Reorganization” means any Plan of Reorganization whose
provisions are inconsistent with the provisions of this Agreement, including any plan of
reorganization that purports to re-order (whether by subordination, invalidation, or otherwise) or
otherwise disregard, in whole or part, the provisions of Article II (including the Lien
priorities of Section 2.1), the provisions of Article IV, or the provisions of
Article VI, unless such Plan of Reorganization has been accepted by the voluntary required vote of each class of Priority Claimholders for such class to have approved such Plan
of Reorganization.



     “Noteholders” means the “Holders” in the Notes Indenture and any holders of Additional
Pari Passu Secured Indebtedness Obligations in each case solely in their capacities as such and not
in any other capacity (except to the extent that such Noteholder is acting in such other capacity
for the primary purpose of benefiting its Notes Obligations).



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     “Notes” means, collectively, (a) the Initial Notes and (b) any other credit agreement,
loan agreement, note agreement, promissory note, indenture or other agreement or instrument
evidencing or governing the terms of any indebtedness or other financial accommodation (other than
ABL Obligations) that has been incurred to increase, replace, refinance or refund in whole or in
part the Obligations outstanding under the Initial Notes or any other agreement or instrument
referred to in this clause which (I) is designated as “Notes” (x) so long as the Notes Indenture or
any Additional Pari Passu Secured Indebtedness Agreement is in effect, the Notes Agent (and, so
long as a Notes Default has not occurred and is continuing at the time of such designation, the
Company) or (y) otherwise, the Company, and (II) the Notes Agent for such agreement shall have
executed a supplement to this Agreement agreeing to be bound hereby on the same terms applicable to
the Notes Agent whether or not such increase, replacement, refinancing or refunding occurs (i) with
the original parties thereto or (ii) on one or more separate occasions. Any reference to the Notes
hereunder shall be deemed a reference to any Notes then in existence.



     “Notes Agent” means (i) the Notes Trustee, including its successors and assigns from
time to time, for so long as any Initial Notes are outstanding and (ii) thereafter, any Additional
Pari Passu Secured Indebtedness Agent provided that the Notes Trustee may require any Additional
Pari Passu Secured Indebtedness Agent (or other representative of Additional Pari Passu Secured
Indebtedness Obligations) to execute an agency agreement covering and acknowledging the rights,
duties, protections and liabilities of the Notes Trustee in its capacity as Notes Agent as a
precondition to acting as Notes Agent on behalf of such Additional Pari Passu Secured Indebtedness
Agent and the holders of Additional Pari Passu Secured Indebtedness Obligations.



     “Notes Claimholders” means, at any relevant time, the holders of Notes Obligations at
that time, including the Noteholders, each Additional Pari Passu Secured Indebtedness Agent and the
Notes Agent in each case solely in their capacities as such and not in any other capacity (except
to the extent that such Notes Claimholder is acting in such other capacity for the primary purpose
of benefiting its Notes Obligations).



     “Notes Collateral” means any and all of the assets and property of any Grantor,
whether real, personal or mixed, with respect to which a Lien is granted as security for any Notes
Obligations.



     “Notes Default” means an “Event of Default” as defined in the Notes Indenture or in
any Additional Pari Passu Secured Indebtedness Agreement.



     “Notes Documents” means the Notes Indenture, the Notes, each Additional Pari Passu
Secured Indebtedness Agreement, the Notes Security Documents and each of the other agreements,
documents and instruments executed pursuant thereto, and any other document or instrument executed
or delivered at any time in connection with any Notes Obligations, including any intercreditor or
joinder agreement among holders of Notes Obligations to the extent such are effective at the
relevant time, as each may be amended, restated, supplemented, modified, renewed, extended or
Refinanced from time to time in accordance with the provisions of this Agreement.



     “Notes General Intangibles” means all General Intangibles related to the other Notes
Priority Collateral.



     “Notes Indenture” has the meaning assigned to that term in the Recitals to this
Agreement.



     “Notes Mortgages” means a collective reference to each mortgage, deed of trust and any
other document or instrument under which any Lien on real property owned or leased by any Grantor
is granted to secure any Notes Obligations or under which rights or remedies with respect to any
such Liens are governed.



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     “Notes Obligations” means all Obligations outstanding under the Notes and the other
Notes Documents and all Additional Pari Passu Secured Indebtedness Obligations. “Notes
Obligations” shall include all interest accrued or accruing (or which would, absent
commencement of an Insolvency or Liquidation Proceeding, accrue) after commencement of an
Insolvency or Liquidation Proceeding in accordance with the rate specified in the relevant Notes
Document, whether or not the claim for such interest is allowed as a claim in such Insolvency or
Liquidation Proceeding.



     “Notes Priority Collateral” means all now owned or hereafter acquired Notes Collateral
that constitutes:




     (a) Real Estate Assets;




     (b) Equipment;




     (c) Notes General Intangibles;




     (d) Letter of Credit Rights arising out of, or related to, or derivative of any of the
property or interests in property described in this definition;




     (e) Instruments, books and records, Supporting Obligations and Commercial Tort Claims,
in each case, to the extent arising out of, or related to, or derivative of, the property or
interests described in this definition;




     (f) all other Collateral other than ABL Priority Collateral; and




     (g) all collateral security and guarantees with respect to any of the foregoing and,
subject to Section 3.5, all proceeds, products, substitutions, replacements,
accessions, cash, Money, insurance proceeds, Instruments, Securities, Security Entitlements,
Financial Assets and Deposit Accounts received as proceeds of any of the foregoing, but
excluding proceeds of ABL Priority Collateral (collectively, “Notes Priority
Proceeds”).



     For the avoidance of doubt, it is hereby acknowledged and agreed that the Notes will not be
secured by a Lien on or security interest in any assets or property of any Foreign Subsidiary
(regardless of whether such assets or property are or have been pledged to the ABL Agent under the
ABL Loan Agreement) and nothing in this Agreement shall be deemed to grant any rights to the Notes
Trustee in respect of such assets or property.



     “Notes Security Documents” means any agreement, document or instrument pursuant to
which a Lien is granted securing any Notes Obligations or under which rights or remedies with
respect to such Liens are governed.



     “Obligations” means all present and future loans, advances, liabilities, obligations,
covenants, duties, and debts from time to time owing by any Grantor to any agent or trustee
(including any Agent), the ABL Claimholders, the Notes Claimholders or any of them or their
respective Affiliates, arising from or in connection with the ABL Loan Documents or the Notes
Documents, whether for principal, interest or payments for early termination, whether or not
evidenced by any note, or other instrument or document, whether arising from an extension of
credit, opening of a letter of credit, acceptance, loan, guaranty, indemnification or otherwise,
whether direct or indirect, absolute or contingent, due or to become due, primary or secondary, as
principal or guarantor, and including all principal, interest, charges, expenses, fees, attorneys’
fees, filing fees and any other sums chargeable to the Grantors, including, without limitation,



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the
“Obligations” as defined in the ABL Loan Agreement and any corresponding term used in the Notes
Indenture.




     “Permitted Refinancing” means any Refinancing the governing documentation of which
constitutes Permitted Refinancing Agreements.



     “Permitted Refinancing Agreements” means, with respect to either the ABL Loan
Agreement, the Notes or any Additional Pari Passu Secured Indebtedness Obligations, as applicable,
any credit agreement, loan agreement, note agreement, promissory note, indenture or other agreement
or instrument evidencing or governing the terms of any indebtedness or other financial
accommodation that has been incurred to increase, replace (whether upon or after termination or
otherwise), refinance or refund in whole or in part the Obligations outstanding under the ABL Loan
Agreement, the Notes or any Additional Pari Passu Secured Indebtedness Obligations, whether or not
such increase, replacement, refinancing or refunding occurs (i) with the original parties thereto,
(ii) on one or more separate occasions or (iii) simultaneously or not with the termination or
repayment of the ABL Loan Agreement, the Notes, any Additional Pari Passu Secured Indebtedness
Obligations or any other agreement or instrument referred to in this clause, unless such agreement
or instrument expressly provides that it is not intended to be and is not a Permitted Refinancing
Agreement, as such financing documentation may be amended, restated, supplemented or otherwise
modified from time to time and that would not be prohibited by Section 5.3(c), Section
5.3(d) or Section 5.3(e), as applicable.



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



     “Plan of Reorganization” means any plan of reorganization, plan of liquidation,
agreement for composition, or other type of plan of arrangement proposed in or in connection with
any Insolvency or Liquidation Proceeding.



     “Pledged Collateral” has the meaning set forth in Section 5.4(a).



     “Prior Lien Agent” shall mean:




     (a) as it relates to the ABL Agent and the ABL Claimholders with respect to all matters
relating to the Notes Priority Collateral (but not the ABL Priority Collateral) prior to the
Discharge of Notes Obligations, the Notes Agent; and




     (b) as it relates to the Notes Agent and the Notes Claimholders with respect to all
matters relating to the ABL Priority Collateral (but not the Notes Priority Collateral)
prior to the Discharge of ABL Obligations, the ABL Agent.



     “Prior Lien Claimholders” shall mean:




     (a) as it relates to the ABL Claimholders with respect to all matters relating to the
Notes Priority Collateral (but not the ABL Priority Collateral) prior to the Discharge of
Notes Obligations, the Notes Claimholders; and




     (b) as it relates to the Notes Claimholders with respect to all matters relating to the
ABL Priority Collateral (but not the Notes Priority Collateral) prior to the Discharge of
ABL Obligations, the ABL Claimholders.



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     “Prior Lien Collateral” shall mean with respect to any Person, all Collateral with
respect to which (and only for so long as) such Person is a “Prior Lien Claimholder” as provided in
the definition thereof.



     “Prior Lien Documents” shall mean:




     (a) as it relates to the ABL Claimholders with respect to all matters relating to the
Notes Priority Collateral (but not the ABL Priority Collateral) prior to the Discharge of
Notes Obligations, the Notes Documents; and




     (c) as it relates to the Notes Claimholders with respect to all matters relating to the
ABL Priority Collateral (but not the Notes Priority Collateral) prior to the Discharge of
ABL Obligations, the ABL Loan Documents.



     “Prior Lien Obligations” shall mean:




     (a) as it relates to the ABL Obligations with respect to all matters relating to the
Notes Priority Collateral (but not the ABL Priority Collateral) prior to the Discharge of
Notes Obligations, the Notes Obligations; and




     (c) as it relates to the Notes Obligations with respect to all matters relating to the
ABL Priority Collateral (but not the Notes Priority Collateral) prior to the Discharge of
ABL Obligations, the ABL Obligations.



     “Proceeds” means all “proceeds” (as defined in Article 9 of the UCC), including any
payment or property received on account of any claim secured by Collateral in any Insolvency or
Liquidation Proceeding.



     “Real Estate Asset” means, at any time of determination, any interest (fee, leasehold
or otherwise) then owned by the Company or any Grantor in any real property.



     “Records” means all present and future “records” (as defined in Article 9 of the UCC).



     “Recovery” has the meaning set forth in Section 6.4.



     “Refinance” means, in respect of any Indebtedness, to refinance, extend, renew,
defease, amend, modify, supplement, restructure, replace, refund or repay, or to issue other
indebtedness, in exchange or replacement for, such Indebtedness, in any case in whole or in part.
“Refinanced” and “Refinancing” shall have correlative meanings.



     “Security” means all present and future “Securities” (as defined in Article 9 of the
UCC).



     “Security Entitlements” means all present and future “security entitlements” (as
defined in Article 9 of the UCC).



     “Securities Accounts” means all present and future “securities accounts” (as defined
in Article 8 of the UCC), including all monies, “uncertificated securities,” and “securities
entitlements” (as defined in Article 8 of the UCC) contained therein.



     “Subordinated Lien Agent” shall mean:




     (a) with respect to all matters relating to the ABL Priority Collateral (but not the
Notes Priority Collateral) prior to the Discharge of ABL Obligations, the Notes Agent; and



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     (b) with respect to all matters relating to the Notes Priority Collateral (but not the
ABL Priority Collateral) prior to the Discharge of Notes Obligations, the ABL Agent.




     “Subordinated Lien Claimholders” shall mean:




     (a) with respect to all matters relating to the ABL Priority Collateral (but not the
Notes Priority Collateral) prior to the Discharge of ABL Obligations, the Notes
Claimholders; and




     (b) with respect to all matters relating to the Notes Priority Collateral (but not the
ABL Priority Collateral) prior to the Discharge of Notes Obligations, the ABL Claimholders.



     “Subordinated Lien Collateral” shall mean with respect to any Person, all Collateral
with respect to which (and only for so long as) such Person is a “Subordinated Lien Claimholder” as
provided in the definition thereof.



     “Subordinated Lien Documents” shall mean:




     (a) with respect to all matters relating to the ABL Priority Collateral (but not the
Notes Priority Collateral) prior to the Discharge of ABL Obligations, the Notes Documents;
and




     (b) with respect to all matters relating to the Notes Priority Collateral (but not the
ABL Priority Collateral) prior to the Discharge of Notes Obligations, the ABL Loan
Documents.



     “Subordinated Lien Obligations” shall mean:




     (a) with respect to all matters relating to the ABL Priority Collateral (but not the
Notes Priority Collateral) prior to the Discharge of ABL Obligations, the Notes Obligations;
and




     (b) with respect to all matters relating to the Notes Priority Collateral (but not the
ABL Priority Collateral) prior to the Discharge of Notes Obligations, the ABL Obligations.



     “Subsidiary” means, with respect to any Person, any corporation, partnership, limited
liability company, association, joint venture or other business entity of which more than 50% of
the total voting power of shares of stock or other ownership interests entitled (without regard to
the occurrence of any contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions) having the power to
direct or cause the direction of the management and policies thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that
Person or a combination thereof.



     “Supporting Obligations” means all present and future “supporting obligations” (as
defined in Article 9 of the UCC).



     “UCC” means the Uniform Commercial Code (or any similar equivalent legislation) as in
effect from time to time in the State of New York; provided, however, that, at any
time, if by reason of mandatory provisions of law, any or all of the perfection or priority of
either Agent’s Lien in any item or portion of the Collateral is governed by the Uniform Commercial
Code as in effect in a jurisdiction other that the State of New York, the term “UCC” shall mean the
Uniform Commercial Code as in effect, at such time, in such other jurisdiction for purposes of the
provisions hereof relating to such perfection or priority and for purposes of definitions relating
to such provisions.



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




     (a) any definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other document as
from time to time amended, restated, supplemented, modified, renewed or extended;




     (b) any reference herein to any Person shall be construed to include such Person’s
permitted 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 Sections or Articles shall be construed to refer to
Sections or Articles of this Agreement;




     (e) all uncapitalized terms have the meanings, if any, given to them in the UCC, as now
or hereafter enacted in the State of New York (unless otherwise specifically defined
herein);




     (f) the words “asset” and “property” shall be construed to have the same meaning and
effect and to refer to any and all tangible and intangible assets and properties, including
cash, securities, accounts and contract rights;




     (g) any reference herein to a Person in a particular capacity or capacities excludes
such Person in any other capacity or individually;




     (h) any reference herein to any law shall be construed to refer to such law as amended,
modified, codified, replaced, or re-enacted, in whole or in part, and in effect on the
pertinent date; and




     (i) in the compilation of periods of time hereunder from a specified date to a later
specified date, the word “from” means “from and including” and the words “to” and “until”
each means” to, but not through.”



II.

LIEN PRIORITIES.




     2.1. Relative Priorities. Irrespective of the date, time, method, manner or order of
grant, attachment or perfection of any Liens securing the ABL Obligations or the Notes Obligations
(including, in each case, irrespective of whether any such Lien is granted (or secures Obligations
relating to the
period) before or after the commencement of any Insolvency or Liquidation Proceeding) and
notwithstanding any provision of any UCC, or any other applicable law, or the ABL Loan Documents or
the Notes Documents or any defect or deficiencies in, or failure to attach or perfect, the Liens
securing the ABL Obligations or the Notes Obligations or any other circumstance whatsoever, the ABL
Agent, on behalf of the ABL Claimholders, and the Notes Agent, on behalf of the Notes Claimholders,
each hereby agrees that:



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     (a) any Lien of the Prior Lien Agent on the ABL Priority Collateral securing Prior Lien
Obligations, whether such Lien is now or hereafter held by or on behalf of the Prior Lien
Agent or any other Prior Lien Claimholder or any other agent or trustee therefor, regardless
of how or when acquired, whether by grant, possession, statute, operation of law,
subrogation or otherwise, shall be senior in all respects and prior to any Lien on the ABL
Priority Collateral securing any Subordinated Lien Obligations; and




     (b) any Lien of the Prior Lien Agent on the Notes Priority Collateral securing Prior
Lien Obligations, whether such Lien is now or hereafter held by or on behalf of the Prior
Lien Agent, any other Prior Lien Claimholder or any other agent or trustee therefor,
regardless of how or when acquired, whether by grant, possession, statute, operation of law,
subrogation or otherwise, shall be senior in all respects to all Liens on the Notes Priority
Collateral securing any Subordinated Lien Obligations.



     2.2. Prohibition on Contesting Liens. Each of the Notes Agent, on behalf of each
Notes Claimholder, and the ABL Agent, on behalf of each ABL Claimholder, consents to the granting
of Liens in favor of the other Agents to secure the ABL Obligations, the Notes Obligations, as
applicable, and agrees that no Claimholder will be entitled to, and it will not (and shall be
deemed to have irrevocably, absolutely, and unconditionally waived any right to), contest (directly
or indirectly) or support (directly or indirectly) any other Person in contesting, in any
proceeding (including any Insolvency or Liquidation Proceeding): (a) the attachment, perfection,
priority, validity or enforceability of any Lien in the Collateral held by or on behalf of any of
the ABL Claimholders to secure the payment of the ABL Obligations or any of the Notes Claimholders
to secure the payment of the Notes Obligations, (b) the priority, validity or enforceability of the
ABL Obligations or the Notes Obligations, including the allowability or priority of the ABL
Obligations or the Notes Obligations, as applicable, in any Insolvency or Liquidation Proceeding,
or (c) the validity or enforceability of the provisions of this Agreement; provided that
nothing in this Agreement shall be construed to prevent or impair the rights of the ABL Agent, on
behalf of the ABL Claimholders or the Notes Agent, on behalf of the Notes Claimholders to enforce
this Agreement, including the provisions of this Agreement relating to the priority of the Liens
securing the Obligations as provided in Sections 2.1, 3.1, 3.2 and
6.1.



     2.3. No New Liens. During the term of this Agreement, whether or not any Insolvency
or Liquidation Proceeding has been commenced by or against one or more of the Company or any other
Grantor, the parties hereto agree, subject to Article VI, that the Company shall not, and
shall not permit any other Grantor to:




     (a) grant or permit any additional Liens on any asset or property to secure any Notes
Obligations unless it has granted or concurrently grants a Lien on such asset or property to
secure the ABL Obligations with the respective priorities required by Section 2.1;.




     (b) grant or permit any additional Liens on any asset or property to secure any ABL
Obligations unless it has granted or concurrently grants a Lien on such asset or property to
secure the Notes Obligations with the respective priorities required by Section 2.1;



     Provided that the Company or any other Grantor may grant or permit additional Liens on assets
and property of a Foreign Subsidiary to secure any ABL Obligation without granting such Lien to
secure any Note Obligation.



     To the extent any additional Liens are granted on any asset or property in contravention of
this Section 2.3 for any reason, without limiting any other rights and remedies available
hereunder, the ABL Agent, on behalf of the ABL Claimholders, and the Notes Agent, on behalf of the
Notes Claimholders,



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agree that any amounts received by or distributed to any of them pursuant to or
as a result of Liens granted in contravention of this Section 2.3 shall be subject to
Section 4.2.




     2.4. Similar Liens and Agreements. The parties hereto agree that it is their
intention that the ABL Collateral and the Notes Collateral be identical except as provided in
Article VI and as otherwise provided herein. In furtherance of the foregoing and of
Section 8.8, the parties hereto agree, subject to the other provisions of this Agreement,
upon request by the ABL Agent or the Notes Agent, to cooperate in good faith (and to direct their
counsel to cooperate in good faith) from time to time in order to determine the specific items
included in the ABL Collateral and the Notes Collateral and the steps taken to perfect their
respective Liens thereon and the identity of the respective parties obligated under the ABL Loan
Documents and the Notes Documents.



III.

EXERCISE OF REMEDIES; ENFORCEMENT.




     3.1. Restrictions on the Subordinated Lien Agents and the Subordinated Lien Claimholders
with respect to ABL Priority Collateral.



     (a) Until the Discharge of Prior Lien Obligations has occurred, whether or not any Insolvency
or Liquidation Proceeding has been commenced by or against any Grantor, the Subordinated Lien
Agents and the Subordinated Lien Claimholders:




     (i) will not exercise or seek to exercise (but instead shall be deemed to have hereby
irrevocably, absolutely and unconditionally waived), any rights, powers, or remedies with
respect to any ABL Priority Collateral (including (A) any right of set-off or any right
under any Account Agreement, landlord waiver or bailee’s letter or similar agreement or
arrangement to which any Subordinated Lien Agent or any other Subordinated Lien Claimholder
is a party or the right to notify any account debtor to make payment as directed by such
Subordinated Lien Claimholder, (B) any right to undertake self-help re-possession or
non-judicial disposition of any ABL Priority Collateral (including any partial or complete
strict foreclosure), (C) any Enforcement action, and/or (D) any right to institute,
prosecute, or otherwise maintain any action or proceeding with respect to such rights,
powers or remedies (including any action of foreclosure));




     (ii) will not, directly or indirectly, contest, protest or object to or hinder any
judicial or non-judicial foreclosure proceeding or action (including any partial or complete
strict foreclosure) brought by the Prior Lien Agent or any Prior Lien Claimholder relating
to the ABL Priority Collateral or any other exercise by the Prior Lien Agent or any other
Prior Lien Claimholder of any other rights, powers and remedies relating to the ABL Priority
Collateral, including any sale, lease, exchange, transfer, or other disposition of the ABL
Priority Collateral, whether under the Prior Lien Documents, applicable law, or otherwise;




     (iii) will not object to the waiver or forbearance by the Prior Lien Agent or any Prior
Lien Claimholders from bringing or pursuing any Enforcement action or other exercise of
rights or remedies with respect to the ABL Priority Collateral;




     (iv) except as may be permitted in Section 3.1(c), irrevocably, absolutely, and
unconditionally waive any and all rights the Subordinated Lien Agent or the Subordinated
Lien Claimholders may have as a junior lien creditor or otherwise to object (and seek or be
awarded any relief of any nature whatsoever based on any such objection) to the manner in
which the Prior Lien Agent or the Prior Lien Claimholders (A) enforce or collect (or attempt
to collect) the Prior Lien Obligations or (B) realize or seek to realize upon or otherwise
enforce the Liens in and to the



-17-









 






ABL Priority Collateral securing the Prior Lien Obligations,
regardless of whether any action or failure to act by or on behalf of the Prior Lien Agent
or Prior Lien Claimholders is adverse to the interest of the Subordinated Lien Agent or the
Subordinated Lien Claimholders and waive any claims that may be had against any Prior Lien
Agent and the Prior Lien Claimholders arising out of any actions which they take or omit to
take (including without limitation, actions with respect to the creation, perfection or
continuation of Liens on any ABL Priority Collateral, actions with respect to the
foreclosure upon, sale, release or depreciation of, or failure to realize upon, any of the
ABL Priority Collateral and actions with respect to the collection of any claim for all or
any part of the Prior Lien Obligations from any account debtor, guarantor or any other
Person) or the valuation, use, protection or release of any Collateral for the Prior Lien
Obligations. Without limiting the generality of the foregoing, to the maximum extent
permitted by law, the Subordinated Lien Agent and the other Subordinated Lien Claimholders
shall be deemed to have hereby irrevocably, absolutely, and unconditionally waived any right
to object (and seek or be awarded any relief of any nature whatsoever based on any such
objection), at any time prior or subsequent to any disposition of any of the ABL Priority
Collateral, on the ground(s) that any such disposition of ABL Priority Collateral (x) would
not be or was not “commercially reasonable” within the meaning of any applicable UCC and/or
(y) would not or did not comply with any other requirement under any applicable UCC or under
any other applicable law governing the manner in which a secured creditor (including one
with a Lien on real property) is to realize on its collateral;




     (v) acknowledge and agree that no covenant, agreement or restriction contained in the
Subordinated Lien Documents shall be deemed to restrict in any way the rights and remedies
of the Prior Lien Agent or the Prior Lien Claimholders with respect to the ABL Priority
Collateral as set forth in this Agreement and the Prior Lien Documents;




     (vi) it will not attempt to direct the Prior Lien Agent or any of the Prior Lien
Claimholders to exercise any right, remedy or power with respect to the ABL Priority
Collateral or exercise any consent to the exercise by the Prior Lien Agent or any of the
Prior Lien Claimholders of any right, remedy or power with respect to the ABL Priority
Collateral;




     (vii) it will not institute any suit or assert in any suit, Insolvency or Liquidation
Proceeding or other proceeding any claim against the Prior Lien Agent or any of the Prior
Lien Claimholders seeking damages or other relief by way of specific performance,
instructions or otherwise with respect to, and neither the Prior Lien Agent nor any of the
Prior Lien Claimholders will be liable for, any action taken or omitted to be taken by any
of them with respect to the ABL Priority Collateral; and




     (viii) it will not attempt, directly or indirectly, whether by judicial proceedings or
otherwise, to challenge the enforceability of any provision of this Agreement;


provided, however, that, in the case of (i), (ii) and (iii) above, the Liens
granted to secure the Subordinated Lien Obligations of the Subordinated Lien Claimholders shall
attach to any Proceeds resulting from actions taken by the Prior Lien Agent or any Prior Lien
Claimholder with respect to the ABL Priority Collateral in accordance with the respective
priorities set forth in Section 2.1 of this Agreement after application of such Proceeds to the extent
necessary to meet the requirements of a Discharge of Prior
Lien Obligations.




     (b) Until the Discharge of Prior Lien Obligations has occurred, whether or not any Insolvency
or Liquidation Proceeding has been commenced by or against any Grantor, the Prior Lien Agent and
the other Prior Lien Claimholders shall have the right to enforce rights, exercise remedies
(including set-off and, except as provided in Section 6.8, the right to credit bid their
debt) and, in connection therewith



-18-









 




(including any Enforcement) make determinations regarding the
release, disposition, or restrictions with respect to the ABL Priority Collateral without any
consultation with or the consent of any Subordinated Lien Agent or any Subordinated Lien
Claimholder; provided, however, that the Liens securing the Subordinated Lien
Obligations shall remain on the Proceeds (other than those applied to the Prior Lien Obligations in
accordance with Section 4.1) of such ABL Priority Collateral released or disposed of
subject to the relative priorities described in Section 2.1. In exercising rights, powers,
and remedies with respect to the ABL Priority Collateral, the Prior Lien Agent and the Prior Lien
Claimholders may enforce the provisions of the Prior Lien Documents and exercise rights, powers,
and/or remedies thereunder and/or under applicable law or otherwise, all in such order and in such
manner as they may determine in the exercise of their sole discretion. Such exercise and
enforcement shall include the rights of an agent appointed by them to sell or otherwise dispose of
the ABL Priority Collateral upon foreclosure, to incur expenses in connection with such sale or
disposition, and to exercise all the rights and remedies of a secured creditor under the UCC and of
a secured creditor under the Bankruptcy Laws of any applicable jurisdiction.




     (c) Notwithstanding anything to the contrary contained herein, any Subordinated Lien Agent or
Subordinated Lien Claimholder may:




     (i) file a claim or statement of interest with respect to its Subordinated Lien
Obligations; provided that an Insolvency or Liquidation Proceeding has been
commenced by or against any Grantor;




     (ii) take any action (not adverse to the priority status of the Liens on the ABL
Priority Collateral, or the rights of the Prior Lien Agent or any of the Prior Lien
Claimholders to exercise rights, powers, and/or remedies in respect thereof, including those
under Article VI) in order to create, perfect, preserve or protect (but not enforce)
its Lien on any of the ABL Priority Collateral;




     (iii) file any necessary responsive or defensive pleadings in opposition to any motion,
claim, adversary proceeding or other pleading made by any Person objecting to or otherwise
seeking the disallowance of the claims of the Prior Lien Claimholders, including any claims
secured by the ABL Priority Collateral, if any, in each case in accordance with the terms of
this Agreement;




     (iv) file any pleadings, objections, motions or agreements which assert rights or
interests available to unsecured creditors of the Grantors arising under either any
Insolvency or Liquidation Proceeding or applicable non-bankruptcy law, in each case not
inconsistent with the terms of this Agreement or applicable law (including the Bankruptcy
Laws of any applicable jurisdiction) and, subject to the restrictions set forth in
Section 3.2, any pleadings, objections, motions or agreements which assert rights or
interests available to secured creditors solely with respect to the Notes Priority
Collateral;




     (v) vote on any Plan of Reorganization, file any proof of claim, make other filings and
make any arguments and motions (including in support of or opposition to, as applicable, the
confirmation or approval of any Plan of Reorganization) that are, in each case, in
accordance with the terms of this Agreement. Without limiting the generality of the
foregoing or of the other provisions of this Agreement, any vote to accept, and any other
act to support the confirmation or approval of, any Non-Conforming Plan of Reorganization
shall be inconsistent with and accordingly, a violation of the terms of this Agreement, and
the Prior Lien Agent shall be entitled to have any such vote to accept a Non-Conforming Plan
of Reorganization changed and any such support of any Non-Conforming Plan of Reorganization
withdrawn.



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The Subordinated Lien Agents, on behalf of the Subordinated Lien Claimholders, agrees that no
Subordinated Lien Claimholder will take or receive any ABL Priority Collateral (including Proceeds)
in connection with the exercise of any right or remedy (including set-off) in its capacity as a
creditor in violation of this Agreement. Without limiting the generality of the foregoing, unless
and until the Discharge of Prior Lien Obligations has occurred, except as expressly provided in
Section 6.7, the sole right of the Subordinated Lien Agents and the Subordinated Lien
Claimholders with respect to the ABL Priority Collateral is to hold a Lien on such Collateral
pursuant to the Subordinated Lien Documents for the period and to the extent granted therein and to
receive a share of the Proceeds thereof, if any, in accordance with Section 4.1.




     (d) Except as otherwise specifically set forth in Sections 3.1(a), 3.1(c)(v),
3.3, 3.4 and Article VI, any Subordinated Lien Agent or Subordinated Lien
Claimholders with respect to the ABL Priority Collateral may exercise rights and remedies as
unsecured creditors against any Grantor and, subject to Section 3.2, may exercise rights
and remedies with respect to the Notes Priority Collateral, in each case, in accordance with the
terms of the Subordinated Lien Documents and applicable law; provided, however,
that in the event that any Subordinated Lien Agent or any Subordinated Lien Claimholder becomes a
judgment Lien creditor in respect of ABL Priority Collateral as a result of its enforcement of its
rights as an unsecured creditor (or secured creditor with respect to the Notes Priority Collateral)
with respect to the Subordinated Lien Obligations, such judgment Lien shall be subject to the terms
of this Agreement for all purposes (including in relation to the Prior Lien Obligations) as the
other Liens on ABL Priority Collateral securing the Subordinated Lien Obligations are subject to
this Agreement.



     (e) Except as provided in Section 5.3(d), nothing in this Section 3.1 shall
prohibit the receipt by any Subordinated Lien Agent or any other Subordinated Lien Claimholders of
the required payments of interest, principal and other amounts owed in respect of the Subordinated
Lien Obligations so long as such (1) amounts are not being paid out of the Proceeds from the
assignment, transfer, sale or other disposition (other than in the ordinary course of business) of
ABL Priority Collateral, unless such Proceeds are permitted to be applied to the payment of
Subordinated Lien Obligations under the ABL Loan Agreement; or (2) receipt is not the direct or
indirect result of the exercise by any Subordinated Lien Agent or any Subordinated Lien
Claimholders of rights or remedies as a secured creditor (including set-off) with respect to ABL
Priority Collateral or enforcement in contravention of this Agreement of any Lien held by any of
them. Nothing in this Section 3.1 impairs or otherwise adversely affects any rights or
remedies the Prior Lien Agent or the Prior Lien Claimholders may have against the Grantors under
the Prior Lien Documents.



     3.2. Restrictions on the Subordinated Lien Agents and the Subordinated Lien Claimholders
with respect to Notes Priority Collateral.



     (a) Until the Discharge of Prior Lien Obligations has occurred, whether or not any Insolvency
or Liquidation Proceeding has been commenced by or against any Grantor, subject to the limited
extent provided in Article VI, the Subordinated Lien Agents and the other Subordinated Lien
Claimholders:




     (i) will not exercise or seek to exercise (but instead shall be deemed to have hereby
irrevocably, absolutely and unconditionally waived) any rights, powers, or remedies with
respect to any Notes Priority Collateral (including (A) any right to undertake self-help
repossession or nonjudicial disposition of any Notes Priority Collateral (including any
partial or complete strict foreclosure), (B) any Enforcement action or (C) any right to
institute, prosecute or otherwise maintain any action or proceeding with respect to such
rights, powers, or remedies (including any action of foreclosure));



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     (ii) will not, directly or indirectly, contest, protest or object to or hinder any
judicial or non-judicial foreclosure proceeding or action (including any partial or complete
strict foreclosure) brought by the Prior Lien Agent or any other Prior Lien Claimholder
relating to the Notes Priority Collateral or any other exercise by the Prior Lien Agent or
any other Prior Lien Claimholder of any rights, powers and remedies relating to the Notes
Priority Collateral, including any sale, lease, exchange, transfer, or other disposition of
the Notes Priority Collateral, whether under the Prior Lien Documents, applicable law, or
otherwise, subject to any obligations of the Prior Lien Agent or the Prior Lien Claimholders
under Sections 3.3 and 3.4;




     (iii) will not object to the waiver or forbearance by the Prior Lien Agent or the Prior
Lien Claimholders from bringing or pursuing any Enforcement action or other exercise of
rights and remedies with respect to the Notes Priority Collateral;




     (iv) subject to Sections 3.2(c), 3.3 and 3.4, irrevocably,
absolutely and unconditionally waive any and all rights the Subordinated Lien Agent and
Subordinated Lien Claimholders may have as a junior lien creditor or otherwise to object
(and seek or be awarded any relief of any nature whatsoever based on any such objection) to
the manner in which the Prior Lien Agent or the Prior Lien Claimholders (a) enforce or
collect (or attempt to collect) the Prior Lien Obligations or (b) realize or seek to realize
upon or otherwise enforce the Liens in and to the Notes Priority Collateral securing the
Prior Lien Obligations, regardless of whether any action or failure to act by or on behalf
of the Prior Lien Agent or Prior Lien Claimholders is adverse to the interest of the
Subordinated Lien Claimholders and waive any claims that may be had against any the Prior
Lien Agent and the Prior Lien Claimholders arising out of any actions which they take or
omit to take (including without limitation, actions with respect to the creation, perfection
or continuation of Liens on any Notes Priority Collateral, actions with respect to the
foreclosure upon, sale, release or depreciation of, or failure to realize upon, any of the
Notes Priority Collateral and actions with respect to the collection of any claim for all or
any part of the Prior Lien Obligations from any account debtor, guarantor or any other
Person) or the valuation, use, protection or release of any Collateral for the Prior Lien
Obligations. Without limiting the generality of the foregoing, to the maximum extent
permitted by law, the Subordinated Lien Agent and the other Subordinated Lien Claimholders
shall be deemed to have hereby irrevocably, absolutely and unconditionally waived any right
to object (and seek or be awarded any relief of any nature whatsoever based on any such
objection), at any time prior to or subsequent to any disposition of any Notes Priority
Collateral, on the ground(s) that any such disposition of Notes Priority Collateral (a)
would not be or was not “commercially reasonable” within the meaning of any applicable UCC
and/or (b) would not or did not comply with any other requirement under any applicable UCC
or under any other applicable law governing the manner in which a secured creditor
(including one with a Lien on real property) is to realize on its collateral;




     (v) subject to Sections 3.3 and 3.4, acknowledge and agree that no
covenant, agreement or restriction contained in any Subordinated Lien Document shall be
deemed to restrict in any way the rights and remedies of the Prior Lien Agent or the Prior
Lien Claimholders with respect to the Notes Priority Collateral as set forth in this
Agreement and the Prior Lien Documents;




     (vi) it will not attempt to direct the Prior Lien Agent or any of the Prior Lien
Claimholders to exercise any right, remedy or power with respect to the Notes Priority
Collateral or exercise any consent to the exercise by the Prior Lien Agent or any of the
Prior Lien Claimholders of any right, remedy or power with respect to the Notes Priority
Collateral;




     (vii) it will not institute any suit or assert in any suit, Insolvency or Liquidation
Proceeding or other proceeding any claim against the Prior Lien Agent or any of the Prior
Lien



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Claimholders seeking damages or other relief by way of specific performance,
instructions or otherwise with respect to, and neither the Prior Lien Agent nor any of the
Prior Lien Claimholders will be liable for, any action taken or omitted to be taken by any
of them with respect to the Notes Priority Collateral; and




     (viii) it will not attempt, directly or indirectly, whether by judicial proceedings or
otherwise, to challenge the enforceability of any provision of this Agreement;


provided, however, that in the case of (i), (ii) and (iii) above, the Liens granted
to secure the Subordinated Lien Obligations of the Subordinated Lien Claimholders shall attach to
any Proceeds resulting from actions taken by the Subordinated Lien Agent or any Subordinated Lien
Claimholder with respect to the Notes Priority Collateral in accordance with this Agreement after
application of such Proceeds to the extent necessary to meet the requirements of a Discharge of
Prior Lien Obligations.




     (b) Until the Discharge of Prior Lien Obligations has occurred, whether or not any Insolvency
or Liquidation Proceeding has been commenced by or against any Grantor, the Prior Lien Agent and
the Prior Lien Claimholders shall have the right to enforce rights, exercise remedies (including
set-off and, except as provided in Section 6.8, the right to credit bid their debt) and
make, in connection therewith (including Enforcements) determinations regarding the release,
disposition, or restrictions with respect to the Notes Priority Collateral without any consultation
with or the consent of any Subordinated Lien Agent or any Subordinated Lien Claimholder subject to
the Notes Agent’s and the Notes Claimholders’ obligations under Sections 3.3 and
3.4; provided, however, that the Liens securing the Subordinated Lien
Obligations shall remain on the Proceeds (other than those properly applied to the Prior Lien
Obligations in accordance with the Prior Lien Documents) of such Collateral released or disposed of
subject to the relative priorities described in Section 2.1. In exercising rights, powers
and remedies with respect to the Notes Priority Collateral, the Prior Lien Agent and the Prior Lien
Claimholders may enforce the provisions of the Prior Lien Documents and exercise rights, powers
and/or remedies thereunder, all in such order and in such manner as they may determine in the
exercise of their sole discretion subject to the Notes Agent’s and the Notes Claimholders’
obligations under Sections 3.3 and 3.4. Such exercise and enforcement shall
include the rights of an agent appointed by them to sell or otherwise dispose of the Notes Priority
Collateral upon foreclosure, to incur expenses in connection with such sale or disposition, and to
exercise all the rights, powers and remedies of a secured creditor under the UCC and of a secured
creditor under the Bankruptcy Laws of any applicable jurisdiction.



     (c) Notwithstanding anything to the contrary contained herein, any Subordinated Lien Agent and
any Subordinated Lien Claimholder may:




     (i) file a claim or statement of interest with respect to the Subordinated Lien
Obligations; provided that an Insolvency or Liquidation Proceeding has been
commenced by or against any Grantor;




     (ii) take any action (not adverse to the priority status of the Liens on the Notes
Priority Collateral, or the rights of the Prior Lien Agent or any of the Prior Lien
Claimholders to exercise rights, powers and/or remedies in respect thereof, including those
under Article VI) in order
to create, perfect, preserve or protect (but, subject to the provisions of Sections
3.3, and 3.4, not enforce) its Lien on any of the Notes Priority Collateral;




     (iii) file any necessary responsive or defensive pleadings in opposition to any motion,
claim, adversary proceeding or other pleading made by any Person objecting to or otherwise
seeking the disallowance of the claims of the Subordinated Lien Claimholders, including any



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claims secured by the Notes Priority Collateral, if any, in each case in accordance with the
terms of this Agreement;




     (iv) file any pleadings, objections, motions or agreements which assert rights or
interests available to unsecured creditors of the Grantors arising under either any
Insolvency or Liquidation Proceeding or applicable non-bankruptcy law, in each case not
inconsistent with the terms of this Agreement or applicable law (including the Bankruptcy
Laws of any applicable jurisdiction) and, subject to Section 3.1, any pleadings,
objections, motions or agreements which assert rights or interests available to secured
creditors solely with respect to the ABL Priority Collateral;




     (v) vote on any Plan of Reorganization, file any proof of claim, make other filings and
make any arguments and motions (including in support of or opposition to, as applicable, the
confirmation or approval of any Plan of Reorganization) that are, in each case, in
accordance with the terms of this Agreement. Without limiting the generality of the
foregoing or of the other provisions of this Agreement, any vote to accept, and any other
act to support the confirmation or approval of, any Non-Conforming Plan of Reorganization
shall be inconsistent with and, accordingly, a violation of the terms of this Agreement, and
the Prior Lien Agent shall be entitled to have any such vote to accept a Non-Conforming Plan
of Reorganization changed and any such support of any Non-Conforming Plan of Reorganization
withdrawn; and




     (vi) in the case of the ABL Agent or any ABL Claimholder, exercise any of its rights,
powers, and/or remedies with respect to any of the Notes Priority Collateral to the extent
permitted by 3.3, and 3.4.


Each Subordinated Lien Agent, on behalf of the Subordinated Lien Claimholders, agrees that no
Subordinated Lien Claimholder will take or receive any Notes Priority Collateral (including
Proceeds) in connection with the exercise of any right or remedy (including set-off) with respect
to any Notes Priority Collateral in violation of this Agreement. Without limiting the generality
of the foregoing, unless and until the Discharge of Prior Lien Obligations has occurred, except as
expressly provided in Sections 3.3, 3.4 and 3.2(c)(vi), the sole right of
the Subordinated Lien Agents and the Subordinated Lien Claimholders with respect to the Notes
Priority Collateral is to hold a Lien on such Collateral pursuant to the Subordinated Lien
Documents for the period and to the extent granted therein and to receive a share of the Proceeds
thereof, if any, in accordance with Section 4.1.




     (d) Except as otherwise specifically set forth in Sections 3.2(a), 3.2(c)(v)
and Article VI, the Subordinated Lien Agents and the Subordinated Lien Claimholders with
respect to the Notes Collateral may exercise rights and remedies as unsecured creditors against any
Grantor and, subject to Section 3.1, may exercise rights and remedies with respect to the
ABL Priority Collateral, in each case, in accordance with the terms of the Subordinated Lien
Documents and applicable law; provided, however, that in the event that any
Subordinated Lien Agent or Subordinated Lien Claimholder becomes a judgment Lien creditor in
respect of Notes Priority Collateral as a result of its enforcement of its rights as an unsecured
creditor (or a secured creditor with respect to the ABL Priority Collateral) with respect to the
Subordinated Lien Obligations, such judgment Lien shall be subject to the terms of this Agreement
for all purposes (including in relation to the Prior Lien Obligations) as the other Liens securing
the Subordinated Lien Obligations are subject to this Agreement.



     (e) Except as provided in Section 5.3(c), nothing in this Agreement shall prohibit the
receipt by any Subordinated Lien Agent or any Subordinated Lien Claimholders of the required
payments of interest, principal and other amounts owed in respect of the Subordinated Lien
Obligations so long as such receipt is not the direct or indirect result of the exercise by a
Subordinated Lien Agent or any Subordinated Lien Claimholders of rights or remedies as a secured
creditor (including set-off) with respect to



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Notes Priority Collateral or enforcement in
contravention of this Agreement of any Lien held by any of them. Nothing in this Section
3.2 impairs or otherwise adversely affects any rights or remedies the Prior Lien Agent or the
Prior Lien Claimholders may have against the Grantors under the Prior Lien Documents.




     3.3. Collateral Access Rights.



     (a) If the Notes Agent, or any agent or representative of the Notes Agent, or any receiver,
shall, after any Notes Default, obtain possession or physical control of any of the Mortgaged
Premises or any of the other Notes Priority Collateral, the Notes Agent shall promptly notify the
ABL Agent in writing of that fact, and the ABL Agent shall, within fifteen (15) Business Days
thereafter, notify the Notes Agent in writing as to whether the ABL Agent desires to exercise
access rights and/or use rights under this Section 3.3. In addition, if the ABL Agent, or
any agent or representative or the ABL Agent, or any receiver, shall obtain possession or physical
control of any of the Mortgaged Premises or any of the Notes Priority Collateral, then the ABL
Agent shall promptly notify the Notes Agent in writing that the ABL Agent is exercising its access
rights and/or use rights under this Agreement and its rights under Section 3.4 under either
circumstance. Upon delivery of such notice by the ABL Agent to the Notes Agent, the parties shall
confer in good faith to coordinate with respect to the ABL Agent’s exercise of such access rights
and/or use rights. Consistent with the definition of “Access Period,” access rights may apply to
differing assets comprimising Notes Priority Collateral at differing times, in which case, a
differing Access Period will apply to each such asset.



     (b) During any pertinent Access Period, the ABL Agent and its agents, representatives and
designees shall have an irrevocable, non-exclusive right to have access to, and a rent-free right
to use, the Notes Priority Collateral for the purpose of (i) arranging for and effecting the sale
or disposition of ABL Priority Collateral located on any Mortgaged Premises included within the
Notes Priority Collateral, including the production, completion, packaging and other preparation of
such ABL Priority Collateral for sale or disposition, including by use of Notes Priority Collateral
consisting of Equipment, (ii) selling (by public auction, private sale or a “store closing”, “going
out of business” or similar sale, whether in bulk, in lots or to customers in the ordinary course
of business or otherwise and which sale may include augmented Inventory of the same type sold in
any Grantor’s business), (iii) assembly, storing or otherwise dealing with the ABL Priority
Collateral, (iv) removing any of the ABL Priority Collateral and (v) taking reasonable actions to
protect, secure and otherwise enforce the rights of the ABL Agent and the ABL Claimholders in and
to the ABL Priority Collateral, in each case without notice to, the involvement of or interference
by the Notes Agent or any Notes Claimholder or liability to the Notes Agent or any Notes
Claimholder. During any such Access Period, the ABL Agent and its representatives (and persons
employed on their behalf), may continue to operate, service, maintain, process and sell the ABL
Priority Collateral, as well as to engage in bulk sales of ABL Priority Collateral. The ABL Agent
shall take proper and reasonable care under the circumstances of any Notes Priority Collateral that
is used by the ABL Agent during the Access Period and repair and replace, or reimburse the Notes
Agent or Notes Claimholders for, any damage (ordinary wear-and-tear excepted) caused by the ABL
Agent or its agents, representatives or designees and the ABL Agent shall comply with all
applicable laws in all material respects in connection with its use or occupancy of the Notes
Priority Collateral. The ABL Agent and the ABL Claimholders shall reimburse the Notes Agent and
the Notes Claimholders for any damage to Notes Priority Collateral (ordinary wear-and-tear
excepted) caused by the acts or omissions of Persons under the ABL Agent’s control;
provided, however, that the ABL Agent and the ABL Claimholders will not be liable
for any diminution in the value of the Mortgaged Premises caused by the absence of the
ABL Priority Collateral therefrom. In no event shall the ABL Claimholders or the ABL Agent have
any liability to the Notes Claimholders and/or to the Notes Agent hereunder as a result of any
condition (including any environmental condition, claim or liability) on or with respect to the
Notes Priority Collateral existing prior to the date of the exercise by the ABL Agent of its rights
under this Agreement. The ABL Agent and the



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Notes Agent shall cooperate and use reasonable efforts
to ensure that their activities during the Access Period as described above do not unduly interfere
with the activities of the other as described above, including the right of the Notes Agent to show
the Notes Priority Collateral to prospective purchasers and to ready the Notes Priority Collateral
for sale.




     (c) Consistent with the definition of the term “Access Period”, if any order or injunction is
issued or stay is granted or is otherwise effective by operation of law that prohibits the ABL
Agent from exercising any of its rights hereunder, then the Access Period granted to the ABL Agent
under this Section 3.3 shall be stayed during the period of such prohibition and shall
continue thereafter for the number of days remaining as required under this Section 3.3.
The Notes Agent shall not sell or dispose of any of the Notes Priority Collateral during the Access
Period, as applicable, unless the buyer agrees in writing to acquire the Notes Priority Collateral
subject to the terms of Section 3.3 and Section 3.4 of this Agreement and agrees
therein to comply with the terms of this Section 3.3. The rights of the ABL Agent and the
ABL Claimholders under this Section 3.3 and Section 3.4 during the Access Period
shall continue notwithstanding such foreclosure, sale or other disposition by the Notes Agent.



     (d) The ABL Agent and the ABL Claimholders shall have the right to bring an action to enforce
their rights under this Section 3.3 and Section 3.4, including, without limitation,
an action seeking possession of the applicable Collateral and/or specific performance of this
Section 3.3 and Section 3.4.



     3.4. Notes General Intangibles Rights/Access to Information.



     (a) The ABL Agent and each Grantor hereby grants (to the full extent of their respective
rights and interests) the Notes Agent and its agents, representatives and designees an irrevocable
royalty-free, rent-free license (which will be binding on any successor or assignee of any ABL
Priority Collateral) to use, all of the Intellectual Property and other General Intangibles at any
time in connection with its Enforcement, which license shall continue indefinitely.



     (b) The Notes Agent and each Grantor hereby grants (to the full extent of their respective
rights and interests) the ABL Agent and its agents, representatives and designees an irrevocable
royalty-free, rent-free license (which will be binding on any successor or assignee of any Notes
Priority Collateral) to use, all of the Notes General Intangibles at any time in connection with
its Enforcement which license shall continue indefinitely.



     3.5. Set-Off and Tracing of and Priorities in Proceeds. The Agent, on behalf of the
Notes Claimholders, acknowledges and agrees that, to the extent the Notes Agent or any Notes
Claimholder exercises its rights of set-off against any ABL Priority Collateral (in violation of
this Agreement), the amount of such set-off shall be held and distributed pursuant to Section
4.1. The ABL Agent, on behalf of the ABL Claimholders, acknowledges and agrees that, to the
extent the ABL Agent or any ABL Claimholder exercises its rights of set-off against any Notes
Priority Collateral (in violation of this Agreement), the amount of such set-off shall be held and
distributed pursuant to Section 4.1. The ABL Agent, for itself and on behalf of the ABL
Claimholders, and the Notes Agent, for itself and on behalf of the Notes Claimholders, each further
agree that prior to an issuance of an Enforcement Notice or the commencement of any Insolvency or
Liquidation Proceeding, any Proceeds of Collateral, whether or not deposited under Account
Agreements, which are used by any Grantor to acquire other property which is Collateral shall not
(solely as between the Agents and the Claimholders) be treated as Proceeds of
Collateral for purposes of determining the relative priorities in the Collateral which was so
acquired. In addition, unless and until the Discharge of ABL Obligations occurs, subject to
Section 4.2, the Notes Agent, on behalf of itself and the Notes Claimholders, hereby
consents to the application, prior to the receipt by the ABL Agent of an Enforcement Notice issued
by the Notes Agent, and thereafter, except as it relates to identifiable proceeds of Notes Priority
Collateral, of cash or other Proceeds of Collateral,



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deposited under Account Agreements in favor of
the ABL Agent to the repayment of ABL Obligations pursuant to the ABL Loan Documents.




IV.

PAYMENTS.




     4.1. Application of Proceeds.



     (a) Prior to the Discharge of Prior Lien Obligations, whether or not any Insolvency or
Liquidation Proceeding has been commenced by or against any Grantor, all ABL Priority Collateral or
Proceeds thereof received at any time in connection with (A) the sale or other disposition of ABL
Priority Collateral (other than in the ordinary course of business), solely to the extent such ABL
Priority Collateral or the Proceeds thereof is not permitted to be applied to the payment of
Subordinated Lien Obligations under the ABL Loan Agreement, and (B) the sale or other disposition
of, or collection on, such ABL Priority Collateral upon any Enforcement by any Agent or any
Claimholder or in any Insolvency or Liquidation Proceeding, shall be delivered to the Prior Lien
Agent and shall be applied in the following order: first, to repay all ABL Obligations in
such order as is specified in the ABL Documents or as a court of competent jurisdiction may
otherwise direct until the Discharge of ABL Obligations has occurred and second, to repay
all outstanding Secured Notes Obligations in such order as specified in the Notes Security
Documents or as a court of competent jurisdiction may otherwise direct until the Discharge of Notes
Obligations has occurred.



     (b) Prior to the Discharge of Prior Lien Obligations, whether or not any Insolvency or
Liquidation Proceeding has been commenced by or against any Grantor, all Notes Priority Collateral
or Proceeds thereof received at any time in connection with (A) the sale or other disposition of
Notes Priority Collateral (other than in the ordinary course of business), solely to the extent
such Notes Priority Collateral or the Proceeds thereof is not permitted to be applied to the
payment of Subordinated Lien Obligations under the Notes Indenture, and (B) the sale or other
disposition of, or collection on, such Notes Priority Collateral upon any Enforcement by any Agent
or any Claimholder or in any Insolvency or Liquidation Proceeding, shall be delivered to the Prior
Lien Agent and shall be applied in the following order: first, to repay all Notes
Obligations in such order as is specified in the Notes Security Documents or as a court of
competent jurisdiction may otherwise direct until the Discharge of Notes Obligations has occurred
and second, to repay all outstanding ABL Obligations in such order as specified in the ABL
Documents or as a court of competent jurisdiction may otherwise direct until the Discharge of ABL
Obligations has occurred.



     4.2. Payments Over in Violation of Agreement. So long as the Discharge of Prior Lien
Obligations has not occurred with respect to any Collateral, whether or not any Insolvency or
Liquidation Proceeding has been commenced by or against any Grantor, any Collateral (including
assets or Proceeds subject to Liens referred to in the final sentence of Section 2.3)
received by any Agent or any Claimholder at any time in connection with (A) the sale or other
disposition of Collateral (other than in the ordinary course of business), solely to the extent
such Collateral or the Proceeds thereof is not permitted to be applied to the payment of
Subordinated Lien Obligations under the applicable Prior Lien Documents, and (B) any Enforcement
(including set-off) relating to the Collateral or in any Insolvency or Liquidation Proceeding shall
be (to the extent in its possession in the case of the Notes Agent) segregated and held in trust
and forthwith paid over to the Prior Lien Agent for the benefit of the Prior Lien Claimholders, in
the
same form as received, with any necessary endorsements or as a court of competent jurisdiction
may otherwise direct. Each Prior Lien Agent with respect to any Collateral is hereby authorized by
the Subordinated Lien Agents and the Subordinated Lien Claimholders with respect to such Collateral
to make any such endorsements as agent for any Subordinated Lien Agent or any Subordinated Lien



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Claimholder. This authorization is coupled with an interest and is irrevocable until the Discharge
of Prior Lien Obligations.




     4.3. Application of Payments. Subject to the other terms of this Agreement, all
payments received by (a) the ABL Agent or the ABL Claimholders may be applied, reversed and
reapplied, in whole or in part, to the ABL Obligations to the extent provided for in the ABL Loan
Documents and (b) the Notes Agent or the Notes Claimholders may be applied, reversed and reapplied,
in whole or in part, to the Notes Obligations to the extent provided for in the Notes Documents.



     4.4. Revolving Nature of ABL Obligations. The Notes Agent, on behalf of the Notes
Claimholders, acknowledges and agrees that the ABL Loan Agreement includes a revolving commitment
and that the amount of the ABL Obligations that may be outstanding at any time or from time to time
may be increased or reduced and subsequently reborrowed.



V.

OTHER AGREEMENTS.




     5.1. Releases.



     (a) (i) If the Prior Lien Agent, on behalf of any of the Prior Lien Claimholders, releases any
of its Liens on any part of the ABL Priority Collateral at any time after the occurrence and during
the continuance of any ABL Default that permits the acceleration of the ABL Obligations or in
connection with the exercise of remedies of Enforcement (including as provided in Section 3.1(b) of
Section 6.8(a)) by the Prior Lien Agent of any Prior Lien Claimholder with respect to any ABL
Priority Collateral, irrespective of whether an ABL Default or Notes Default has occurred and is
continuing, then the Liens, if any, of the Subordinated Lien Agents, for the benefit of the
Subordinated Lien Claimholders, on the ABL Priority Collateral sold or disposed of in connection
therewith, shall be automatically, unconditionally and simultaneously released; provided
that, to the extent the Proceeds of such ABL Priority Collateral are not applied to reduce Prior
Lien Obligations, the Subordinated Lien Agents shall retain Liens on such Proceeds with the
respective priorities set forth in Section 2.1. Each Subordinated Lien Agent, on behalf of
the applicable Subordinated Lien Claimholders, promptly shall execute and deliver to the Prior Lien
Agent such termination statements, releases and other documents as the Prior Lien Agent may request
in writing to effectively confirm such release.



     (ii) If the Prior Lien Agent, on behalf of any of the Prior Lien Claimholders, releases any of
its Liens on any part of the Notes Priority Collateral at any time after the occurrence and during
the continuance of any Notes Default that permits the acceleration of the Notes Obligations or in
connection with the exercise of remedies of Enforcement (including as provided in Section 3.1(b) of
Section 6.8(a)) by the Prior Lien Agent of any Prior Lien Claimholder with respect to any Notes
Priority Collateral, irrespective of whether an Notes Default or ABL Default has occurred and is
continuing, then the Liens, if any, of each Subordinated Lien Agent, for the benefit of the
Subordinated Lien Claimholders, on the Notes Priority Collateral sold or disposed of in connection
therewith, shall be automatically, unconditionally and simultaneously released; provided
that the provisions of Section 3.3 and 3.4 shall continue, to the extent such
Sections are applicable at the time of such sale, transfer or other disposition; provided,
further, that, to the extent the Proceeds of such Notes Priority Collateral are not applied
to reduce Prior Lien Obligations, the Subordinated Lien Agents shall retain Liens on such Proceeds
with the respective priorities set forth in Section 2.1. Each Subordinated Lien Agent, on
behalf of the applicable Subordinated Lien
Claimholders, promptly shall execute and deliver to the Prior Lien Agent such termination
statements, releases and other documents as the Prior Lien Agent may request to effectively confirm
such release.



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     (b) Each Subordinated Lien Agent with respect to any Collateral, on behalf of the applicable
Subordinated Lien Claimholders, hereby irrevocably constitutes and appoints each Prior Lien Agent
with respect to such Collateral and any officer or agent of such Prior Lien Agent, with full power
of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority
in the place and stead of such Subordinated Lien Agent or such Subordinated Lien Claimholder or in
the Subordinated Lien Agent’s own name, from time to time in such Prior Lien Agent’s discretion
exercised in good faith, for the purpose of carrying out the terms of this Section 5.1, to
take any and all appropriate action and to execute any and all documents and instruments which may
be necessary to accomplish the purposes of this Section 5.1, including any endorsements or
other instruments of transfer or release.



     5.2. Insurance.



     (a) Subject to the terms of, and the rights of the Grantors under, the Prior Lien Documents,
the Prior Lien Agent, on behalf of the Prior Lien Claimholders, shall have the sole and exclusive
right to adjust settlement for any insurance policy covering the ABL Priority Collateral in the
event of any loss thereunder and to approve any award granted in any condemnation or similar
proceeding (or any deed in lieu of condemnation) affecting such ABL Priority Collateral. All
Proceeds of any such policy and any such award (or any payments with respect to a deed in lieu of
condemnation) if in respect of the ABL Priority Collateral and to the extent required by the Prior
Lien Documents shall be paid to the Prior Lien Agent for the benefit of the Prior Lien Claimholders
pursuant to the terms of the Prior Lien Documents (including, without limitation, for purposes of
cash collateralization of letters of credit) and thereafter until the Discharge of Prior Lien
Obligations has occurred. If any Subordinated Lien Agent or any Subordinated Lien Claimholders
shall, at any time, receive any Proceeds of any such insurance policy or any such award or payment
with respect to ABL Priority Collateral in contravention of this Agreement, it shall (to the extent
in its possession in the case of the Notes Agent) segregate and hold in trust and forthwith pay
such amount over to the Prior Lien Agent in accordance with the terms of Section 4.2.



     (b) Subject to the terms of, and the rights of the Grantors under, the Prior Lien Documents,
the Prior Lien Agent, on behalf of the Prior Lien Claimholders, shall have the sole and exclusive
right to adjust settlement for any insurance policy covering the Notes Priority Collateral in the
event of any loss thereunder and to approve any award granted in any condemnation or similar
proceeding (or any deed in lieu of condemnation) affecting such Notes Priority Collateral. All
Proceeds of any such policy and any such award (or any payments with respect to a deed in lieu of
condemnation) if in respect of the Notes Priority Collateral and to the extent required by the
Prior Lien Documents shall be paid to the Prior Lien Agent for the benefit of the Prior Lien
Claimholders pursuant to the terms of the Prior Lien Documents (including, without limitation, for
purposes of cash collateralization of letters of credit) and thereafter until the Discharge of
Prior Lien Obligations has occurred. If any Subordinated Lien Agent or any Subordinated Lien
Claimholders shall, at any time, receive any Proceeds of any such insurance policy or any such
award or payment with respect to Notes Priority Collateral in contravention of this Agreement, it
shall (to the extent in its possession in the case of the ABL Agent) segregate and hold in trust
and forthwith pay such amount over to the Prior Lien Agent in accordance with the terms of
Section 4.2.



     (c) To effectuate the foregoing, and to the extent that the pertinent insurance company agrees
to issue such endorsements, the Agents shall each receive separate lender’s loss payable
endorsements naming themselves as loss payee and additional insured, as their interests may appear,
with respect to policies which insure Collateral hereunder.



     5.3. Amendments to ABL Loan Documents and Notes Documents; Refinancing.



     (a) Subject to Sections 5.3(c) and 5.3(d), the ABL Loan Documents and Notes
Documents may be amended, supplemented or otherwise modified in accordance with their terms, all
without



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affecting the Lien subordination or other provisions of this Agreement. The (i) ABL
Obligations may be Refinanced without notice to, or the consent of the Notes Agent or the Notes
Claimholders and without affecting the Lien subordination or other provisions of this Agreement and
(ii) the Notes Obligations may be Refinanced without notice to, or consent of, the ABL Agent or the
ABL Claimholders; provided, however, that, in each case, the lenders or holders of
any such Refinancing debt that is purported to be secured by a Lien on any Collateral bind
themselves in writing to the terms of this Agreement; provided further,
however, that, if such Refinancing debt is secured by a Lien on any Collateral, the holders
of such Refinancing debt shall be deemed bound by the terms hereof regardless of whether or not
such writing is provided. For the avoidance of doubt, the sale or other transfer of Indebtedness
is not restricted by this Agreement but the provisions of this Agreement shall be binding on all
holders of ABL Obligations and Notes Obligations.




     (b) Subject to Sections 5.3(c) and 5.3(d), the ABL Agent and the Notes Agent
shall each use good faith efforts to notify the other party of any written amendment or
modification to the ABL Documents and the Notes Documents, respectively, but the failure to provide
such notice shall not create a cause of action against the party failing to give such notice or
create any claim or right on behalf of any other Secured Party.



     (c) Without the consent of the Notes Agent, the ABL Claimholders will not be entitled to agree
(and will not agree) to any amendment to or modification of the ABL Loan Documents, whether in a
Refinancing or otherwise, that is prohibited by the Notes Indenture as in effect on the date hereof
(or, if less restrictive to the ABL Claimholders, as in effect on the date of such amendment or
modification).



     (d) Without the consent of the ABL Agent, the Notes Agent and the Notes Claimholders will not
be entitled to agree (and will not agree) to any amendment to or modification of the Notes
Documents, whether in a Refinancing or otherwise, that is prohibited by the ABL Loan Agreement as
in effect on the date hereof.



     (e) [RESERVED]



     (f) So long as the Discharge of ABL Obligations has not occurred, the Notes Agent agrees that
each Notes Security Document shall include the following language (or similar language acceptable
to the ABL Agent): “Notwithstanding anything herein to the contrary, the liens and security
interests granted to The Bank of New York Mellon Trust Company, N.A., as Notes Agent, pursuant to
this Agreement and the exercise of any right or remedy by The Bank of New York Mellon Trust
Company, N.A., as Trustee hereunder, are subject to the provisions of the Intercreditor Agreement
dated as of February 8, 2010 (as amended, restated, supplemented or otherwise modified from time to
time, the “Intercreditor Agreement”), among JPMorgan Chase Bank, N.A., as ABL Agent, The
Bank of New York Mellon Trust Company, N.A., as Notes Agent, and the Grantors (as defined in the
Intercreditor Agreement) from time to time party thereto. In the event of any conflict between the
terms of the Intercreditor Agreement and the terms of this Agreement, the terms of the
Intercreditor Agreement shall govern and control.”



     (g) So long as the Discharge of Notes Obligations has not occurred, the ABL Agent agrees that
each applicable ABL Security Document shall include the following language (or similar language
acceptable to the Notes Agent): “Notwithstanding anything herein to the contrary, the liens and
security interests granted to the Collateral Agent pursuant to this Agreement and the exercise of
any right or remedy by the Collateral Agent hereunder, are subject to the provisions of the
Intercreditor Agreement dated as of February [    ], 2010 (as amended, restated, supplemented or
otherwise modified from time to time,
the “Intercreditor Agreement”), among the Collateral Agent, as ABL Agent, The Bank of
New York Mellon Trust Company, N.A., as Notes Agent, and the Grantors (as defined in the
Intercreditor Agreement)



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from time to time party thereto. In the event of any conflict between the
terms of the Intercreditor Agreement and the terms of this Agreement, the terms of the
Intercreditor Agreement shall govern and control.”




     5.4. Bailees for Perfection.



     (a) Each Agent agrees to hold that part of the Collateral that is in its possession or control
(or in the possession or control of its agents or bailees) to the extent that possession or control
thereof is taken to perfect a Lien thereon (such Collateral, which shall include without limitation
Account Agreements and Capital Stock, being the “Pledged Collateral”) as (i) in the case of
the ABL Agent, the collateral agent for the ABL Claimholders under the ABL Loan Documents or, in
the case of the Notes Agent, the collateral agent for the Notes Claimholders under the Notes
Documents and (ii) gratuitous bailee for the benefit of each other Agent (such bailment being
intended, among other things, to satisfy the requirements of Sections 8-301(a)(2) and 9-313(c) of
the UCC) and any assignee solely for the purpose of perfecting the security interest granted under
the ABL Loan Documents and the Notes Documents, respectively, subject to the terms and conditions
of this Section 5.4. The Notes Agent and the Notes Claimholders hereby appoint the ABL
Agent as their gratuitous bailee for the purposes of perfecting their security interest in all
Pledged Collateral in which the ABL Agent has a perfected security interest under the UCC. The ABL
Agent and the ABL Claimholders hereby appoint the Notes Agent as their gratuitous bailee for the
purposes of perfecting their security interest in all Pledged Collateral in which the Notes Agent
has a perfected security interest under the UCC. Each Agent hereby accepts such appointments
pursuant to this Section 5.4(a) and acknowledges and agrees that it shall act for the
benefit of the other Claimholders with respect to any Pledged Collateral and that any Proceeds
received by such Agent under any Pledged Collateral shall be applied in accordance with Article
IV. In furtherance of the foregoing, each Grantor hereby grants a security interest in the
Pledged Collateral to (x) the Notes Agent for the benefit of the ABL Claimholders and (y) the ABL
Agent for the benefit of the Notes Claimholders.



     (b) No Agent shall have any obligation whatsoever to any other Secured Party as a result of
Section 5.4(a) to ensure that the Pledged Collateral is genuine or owned by any of the
Grantors or to preserve rights or benefits of any Person. The duties or responsibilities of the
respective Agents under this Section 5.4 shall be limited solely to holding the Pledged
Collateral as bailee in accordance with this Section 5.4 and delivering the Pledged
Collateral with respect to which it is the Prior Lien Agent that is in its possession upon a
Discharge of Prior Lien Obligations as provided in paragraph (d) below.



     (c) No Agent acting pursuant to this Section 5.4 shall have by reason of the ABL Loan
Documents, the Notes Documents, this Agreement or any other document a fiduciary relationship in
respect of any other Agent or Secured Party.



     (d) Upon the Discharge of Notes Obligations, the Notes Agent shall deliver the remaining
Pledged Collateral (if any) in its possession together with any necessary endorsements to the ABL
Agent to the extent the Discharge of ABL Obligations has not occurred. Upon the Discharge of ABL
Obligations, the ABL Agent shall deliver the remaining Pledged Collateral (if any) in its
possession together with any necessary endorsements to the Notes Agent to the extent the Discharge
of Notes Obligations has not occurred. Notwithstanding anything to the contrary contained in this
Agreement, any obligation of the Agent, to make any delivery to the other Agent under this
Section 5.4(d) or Section 5.5 is subject to (i) the order of any court of competent
jurisdiction, or (ii) any automatic stay imposed in connection with any Insolvency or Liquidation
Proceeding.



     5.5. When Discharge of ABL Obligations and Discharge of Notes Obligations Deemed to Not
Have Occurred. If at any time after the Discharge of ABL Obligations or a Discharge of Notes
Obligations, the Company shall enter into any Permitted Refinancing of any ABL Obligation or Notes



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Obligations, as applicable, then such Discharge of ABL Obligations or Discharge of Notes
Obligations shall automatically be deemed not to have occurred for all purposes of this Agreement
(other than with respect to any actions taken as a result of the occurrence of such first Discharge
of ABL Obligations or Discharge of Notes Obligations in order to effectuate such discharge among
(i) the agent(s) and other claimholders under the facility to be discharged, (ii) the agents and
other claimholders under the new facility, and (iii) the Grantors), and, from and after the date on
which the New Debt Notice is delivered to each Agent in accordance with the next sentence, the
obligations under such Permitted Refinancing shall automatically be treated as ABL Obligations or
Notes Obligations for all purposes of this Agreement, as applicable, including for purposes of the
Lien priorities and rights in respect of Collateral set forth herein, and the ABL Agent or the
Notes Agent, as applicable, under such new ABL Loan Documents or Notes Documents, as applicable,
shall be the ABL Agent or the Notes Agent, as applicable, for all purposes of this Agreement. Upon
receipt of a notice (the “New Debt Notice”) stating that the Company has entered into new
ABL Loan Documents or new Notes Documents (which notice shall include a complete copy of the
relevant new documents and provide the identity of the new Agent, such agent, the “New
Agent”), each other Agent, upon written request of the New Agent, shall promptly (a) enter into
such documents and agreements (including amendments or supplements to this Agreement) as the
Company or such New Agent shall reasonably request in order to provide to the New Agent the rights
contemplated hereby, in each case consistent in all material respects with the then terms of this
Agreement and (b) deliver to the New Agent any Pledged Collateral in the possession of any
Subordinated Lien Agent to the extent such New Agent is the Prior Lien Agent with respect to such
Pledged Collateral together with any necessary endorsements (or otherwise allow the New Agent to
obtain control of such Pledged Collateral). In accordance with Section 5.3(a), the New
Agent shall agree in a writing addressed to each other Agent and the Claimholders, as applicable,
to be bound by the terms of this Agreement.




VI.

INSOLVENCY OR LIQUIDATION PROCEEDINGS.




     6.1. Finance and Sale Issues. Each Subordinated Lien Agent, on behalf of the
applicable Subordinated Lien Claimholders, hereby agrees that, until the Discharge of Prior Lien
Obligations has occurred, if any Grantor shall be subject to any Insolvency or Liquidation
Proceeding and the Prior Lien Agent or the Prior Lien Claimholders with respect to any of such
Subordinated Lien Claimholders’ Subordinated Lien Collateral shall desire to permit the use of
“cash collateral” (as such term is defined in Section 363(a) of the Bankruptcy Code) representing
Proceeds of such Subordinated Lien Collateral or to permit any Grantor to obtain financing, whether
from the Prior Lien Claimholders or any other Person under Section 364 of the Bankruptcy Code or
any similar Bankruptcy Law (“DIP Financing”) secured by a Lien on such Subordinated Lien
Collateral, then no Subordinated Lien Claimholder will be entitled to raise (and will not raise or
support any Person in raising), but instead shall be deemed to have hereby irrevocably and
absolutely waived, any objection to, and shall not otherwise in any manner be entitled to oppose or
will oppose or support any Person in opposing, such cash collateral use or DIP Financing
(including, except as expressly provided below, any claim that the Subordinated Lien Claimholders
are entitled to adequate protection on account of their interests in such Subordinated Lien
Collateral as a condition thereto) so long as such cash collateral use or DIP Financing meets the
following requirements: (i) each Subordinated Lien Claimholder retains a Lien on its Subordinated
Lien Collateral for any DIP Financing with, except as provided in the following sentence, the
respective priorities provided in Section 2.1, and (x) with respect to Subordinated Lien
Collateral of the ABL Claimholders or cash collateral in respect thereof, no Lien is granted to
secure such DIP Financing on any ABL Priority Collateral and no such cash collateral to be used
constitutes Proceeds of ABL Priority Collateral unless the ABL Claimholders have consented thereto
or (y) with respect to Subordinated Lien Collateral of the Notes
Claimholders or cash collateral in respect thereof, no Lien is granted to secure such DIP
Financing on any Notes Priority Collateral and no such cash collateral to be used constitutes
Proceeds of Notes Priority Collateral unless the Notes Claimholders have consented thereto, (ii) to
the extent that the Prior Lien



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Agent is granted adequate protection in the form of a Lien on
Collateral arising after the commencement of the Insolvency or Liquidation Proceeding, the
Subordinated Lien Claimholders are permitted to seek a Lien on such additional Collateral with,
except as set forth in the following sentence, the relative priority set forth in Section
2.1 (and no Prior Lien Agent or Prior Lien Claimholder shall oppose any motion by any
Subordinated Lien Claimholder to receive such a Lien), (iii) the terms of such DIP Financing or use
of cash collateral do not require any Grantor to seek approval for any Plan of Reorganization that
is not a Conforming Plan of Reorganization and (iv) the terms of such DIP Financing do not require
such Subordinated Claimholders to extend additional credit pursuant to such DIP Financing. If
requested by the Prior Lien Agent, each Subordinated Lien Agent and Subordinated Lien Claimholders
shall be required to subordinate and will subordinate its Liens in its Subordinated Lien Collateral
to the Liens securing any such DIP Financing (and all obligations relating thereto, including any
“carve-out” granting administrative priority status or Lien priority to secure repayment of fees
and expenses of professionals retained by any debtor or creditors’ committee); provided that the
Liens on such Subordinated Lien Collateral securing such DIP Financing rank pari
passu with or senior to the Liens securing the Prior Lien Obligations. Each Subordinated
Lien Agent on behalf of itself and the applicable Subordinated Lien Claimholders, agrees that no
such Person shall provide to such Grantor any DIP Financing (or support any other Person in seeking
to provide to any Grantor any such DIP Financing) to the extent that any Subordinated Lien
Claimholder would, in connection with such financing, be granted a Lien on any of its Subordinated
Lien Collateral unless the Prior Lien Claimholders shall have consented thereto.




     6.2. Relief from the Automatic Stay. Until the Discharge of Prior Lien Obligations,
each Subordinated Lien Agent, and the other Subordinated Lien Claimholders, agree that none of them
shall seek (or support any other Person seeking) relief from the automatic stay or any other stay
in any Insolvency or Liquidation Proceeding in respect of any of their respective Subordinated Lien
Collateral, without the prior written consent of the Prior Lien Agent for such Collateral (given or
not given in its sole and absolute discretion), unless (a) the Prior Lien Agent already has filed a
motion (which remains pending) for such relief with respect to its interest in such Collateral and
(b) a corresponding motion, in the reasonable judgment of the applicable Subordinated Lien Agent,
must be filed solely for the purpose of preserving such Subordinated Lien Agent’s ability to
receive residual distributions pursuant to Section 4.1, although the Subordinated Lien
Claimholders shall otherwise remain subject to the applicable restrictions in Section 3.1
and Section 3.2 following the granting of any such relief from the automatic stay.



     6.3. Adequate Protection. Prior to the Discharge of Prior Lien Obligations, each
Subordinated Lien Agent, on behalf of itself and the applicable Subordinated Lien Claimholders,
agrees that none of them shall be entitled to contest and none of them shall contest (or support
any other Person contesting) (but instead shall be deemed to have hereby irrevocably, absolutely,
and unconditionally waived any right):


     (i) any request by the Prior Lien Agent or the other Prior Lien Claimholders for relief
from the automatic stay with respect to the Subordinated Lien Collateral of such
Subordinated Lien Claimholders; or



     (ii) any request by the Prior Lien Agent or the other Prior Lien Claimholders for
adequate protection with respect to the Subordinated Lien Collateral of such Subordinated
Lien Claimholders; or
(iii) any objection by the Prior Lien Agent or the other Prior Lien Claimholders to any
motion, relief, action or proceeding based on the Prior Lien Agent or the other Prior Lien
Claimholders claiming a lack of adequate protection with respect to the Subordinated Lien
Collateral of such Subordinated Lien Claimholders.




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     (b) Consistent with the foregoing provisions in this Section 6.3, and except as
provided in Sections 6.1 and 6.7, in any Insolvency or Liquidation Proceeding, no
Subordinated Lien Claimholder shall be entitled (and each Subordinated Lien Claimholder shall be
deemed to have hereby irrevocably, absolutely, and unconditionally waived any right) to seek or
otherwise be granted any type of adequate protection with respect to its interests in its
Subordinated Lien Collateral (except as expressly set forth in Section 6.1 or as may
otherwise be consented to in writing by the Prior Lien Agent with respect to such Collateral in its
sole and absolute discretion); provided, however, subject to Section 6.1,
Subordinated Lien Claimholders may seek and obtain adequate protection in the form of an additional
or replacement Liens on Collateral so long as (i) the Prior Lien Claimholders have been granted
adequate protection in the form of a replacement lien on such Collateral, and (ii) any such Lien on
Subordinated Lien Collateral (and on any Collateral granted as adequate protection for the
Subordinated Lien Claimholders in respect of their interest in such Subordinated Lien Collateral)
is subordinated to the Liens of the Prior Lien Agent in such Collateral on the same basis as the
other Liens of the Subordinated Lien Agents on Subordinated Lien Collateral; and



     (c) Nothing herein shall limit the rights of any Prior Lien Agent or the Prior Lien
Claimholders to seek adequate protection with respect to their rights in their Prior Lien
Collateral in any Insolvency or Liquidation Proceeding (including adequate protection in the form
of a cash payment, periodic cash payments or otherwise) so long as such request is not otherwise
inconsistent with this Agreement.



     6.4. Avoidance Issues. If any Prior Lien Claimholder is required in any Insolvency or
Liquidation Proceeding or otherwise to turn over or otherwise pay to the estate of the applicable
Grantor any amount paid in respect of ABL Obligations or the Notes Obligations, as applicable (a
“Recovery”), then such ABL Claimholders or Notes Claimholders shall be entitled to a
reinstatement of ABL Obligations or the Notes Obligations, as applicable, with respect to all such
recovered amounts. If this Agreement shall have been terminated with respect to any Claimholder
prior to such Recovery, this Agreement shall be reinstated in full force and effect, and such prior
termination shall not diminish, release, discharge, impair or otherwise affect the obligations of
the parties hereto from such date of reinstatement or with respect to any amounts previously
received.



     6.5. Reorganization Securities. Subject to the ability of the ABL Claimholders and
the Notes Claimholders, as applicable, to support or oppose confirmation or approval of any
Conforming Plan of Reorganization or to oppose confirmation or approval of any Non-Conforming Plan
of Reorganization, as provided herein, if, in any Insolvency or Liquidation Proceeding, debt
obligations of the reorganized debtor secured by Liens upon any property of the reorganized debtor
are distributed pursuant to a Plan of Reorganization, both on account of Prior Lien Obligations and
on account of Subordinated Lien Obligations, then, to the extent the debt obligations distributed
on account of the Prior Lien Obligations and on account of the Subordinated Lien Obligations are
secured by Liens upon the same property, the provisions of this Agreement will survive the
distribution of such debt obligations pursuant to such plan and will apply with like effect to the
debt obligations so distributed, to the Liens securing such debt obligations and the distribution
of Proceeds thereof.



     6.6. Post-Petition Interest. No Subordinated Lien Claimholder shall oppose or seek to
challenge any claim by any Prior Lien Agent or any Prior Lien Claimholder for allowance in any
Insolvency or Liquidation Proceeding of Prior Lien Obligations consisting of post-petition
interest, fees
or expenses to the extent of the value of the Lien on such Prior Lien Claimholder’s Prior Lien
Collateral, without regard to the existence of the Subordinated Lien Obligations with respect to
such Collateral.



     6.7. Separate Grants of Security and Separate Classification. The ABL Agent, on
behalf of the ABL Claimholders, and the Agent on behalf of the Notes Claimholders, acknowledge and
intend that: the respective grants of Liens pursuant to the ABL Security Documents and the Notes
Documents



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constitute two separate and distinct grants of Liens, and because of, among other things,
their differing rights in the Collateral, such that the Notes Obligations and the ABL Obligations
are fundamentally different and, in each case, must be separately classified in any Plan of
Reorganization proposed or confirmed (or approved) in an Insolvency or Liquidation Proceeding. To
further effectuate the intent of the parties as provided in the immediately preceding sentence, if
it is held that the claims of the Notes Claimholders and the ABL Claimholders, in each case, in
respect of the Collateral constitute claims in the same class (rather than at least two separate
classes of secured claims with the priorities described in Section 2.1), then the ABL
Claimholders and the Notes Claimholders hereby acknowledge and agree that all distributions shall
be made as if there were two separate classes of ABL Obligations and Notes Obligations (with the
effect being that, to the extent that the aggregate value of their Prior Lien Collateral is
sufficient (for this purpose ignoring all claims held by the Subordinated Lien Claimholders
thereon), the Prior Lien Claimholders shall be entitled to receive, in addition to amounts
distributed to them in respect of principal, pre-petition interest and other claims, all amounts
owing in respect of post-petition interest, fees or expenses that is available from their Prior
Lien Collateral, before any distribution is made in respect of the Subordinated Lien Obligations
with respect to such Collateral, with each Subordinated Lien Claimholder acknowledging and agreeing
to turn over to the Prior Lien Agent with respect to such Collateral amounts otherwise received or
receivable by them to the extent necessary to effectuate the intent of this sentence, even if such
turnover has the effect of reducing the aggregate recoveries of the Subordinated Lien Obligations.




     6.8. Asset Dispositions in an Insolvency or Liquidation Proceeding.



     (a) Without limiting the Prior Lien Agent’s and the Prior Lien Claimholders’ rights under
Section 3.1(b), neither any Subordinated Lien Agent nor any other Subordinated Lien
Claimholder shall, in any Insolvency or Liquidation Proceeding or otherwise, oppose any sale or
disposition of any ABL Priority Collateral that is supported by the Prior Lien Claimholders, and
each Subordinated Lien Agent and each other Subordinated Lien Claimholder will be deemed to have
irrevocably, absolutely, and unconditionally consented under Section 363 of the Bankruptcy Code
(and otherwise) to any sale of any ABL Priority Collateral supported by the Prior Lien Claimholders
and to have released their Liens on such assets; provided that to the extent the Proceeds
of such Collateral are not applied to reduce Prior Lien Obligations or any DIP Financing secured by
a prior Lien on such ABL Priority Collateral, each Subordinated Lien Agent shall retain a Lien on
such Proceeds with the respective priorities described in Section 2.1. Notwithstanding the
foregoing, this Agreement shall not be construed to in any way limit or impair the right of the
Subordinated Lien Claimholders from exercising a credit bid in a sale or other disposition of their
Subordinated Lien Collateral under Section 363 of the Bankruptcy Code; provided that in
connection with and immediately after giving effect to such sale and credit bid there occurs a
Discharge of Prior Lien Obligations.



     (b) Without limiting the Prior Lien Agent’s and the Prior Lien Claimholders’ rights under
Section 3.2(b), neither any Subordinated Lien Agent nor any other Subordinated Lien
Claimholder shall, in any Insolvency Proceeding or otherwise, oppose any sale or disposition of any
Notes Priority Collateral that is supported by the Prior Lien Claimholders (but in the case of the
ABL Claimholders, subject to their rights under Section 3.3(d)), and each Subordinated Lien
Agent and each other Subordinated Lien Claimholder will be deemed to have consented under Section
363 of the Bankruptcy Code (and otherwise) to any sale of any Notes Priority Collateral supported
by the Prior Lien Claimholders and to have released
their Liens on such assets; provided that to the extent the Proceeds of such
Collateral are not applied to reduce Prior Lien Obligations or any DIP Financing secured by a prior
Lien on such Notes Priority Collateral, each Subordinated Lien Agent shall retain a Lien on such
Proceeds with the respective priorities described in Section 2.1; provided
further that the ABL Agent’s and the ABL Claimholders’ rights under Sections 3.3
and 3.4 shall survive any such sale or disposition.



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     6.9. Expense Claims. No Subordinated Lien Agent or other Subordinated Lien
Claimholder will assert or enforce (or support any Person asserting or enforcing), at any time
prior to the Discharge of ABL Obligations with respect to any Collateral, any claim under Section
506(c) of the Bankruptcy Code senior to or on a parity with the Liens in favor of the ABL Agent and
the other ABL Claimholders for costs or expenses of preserving or disposing of any such
Collateral.



     6.10. Waivers. Each Subordinated Lien Agent, on behalf of the applicable Subordinated
Lien Claimholders, waives any claim the Subordinated Lien Claimholders may hereafter have against
any ABL Claimholder arising out of (a) the election of any ABL Agent or other ABL Claimholder of
the application of Section 1111(b)(2) of the Bankruptcy Code or (b) any borrowing of, or grant of a
security interest or administrative expense priority by, the Company or any of its Subsidiaries as
debtors-in-possession under Sections 363 and 364 of the Bankruptcy Code, in each case, any
Insolvency or Liquidation Proceeding.



VII.

RELIANCE; WAIVERS; ETC.




     7.1. Reliance. Other than any reliance on the terms of this Agreement, the ABL Agent,
on behalf the ABL Claimholders, acknowledges that it and the other ABL Claimholders have,
independently and without reliance on the Notes Agent or any Notes Claimholder, and based on
documents and information deemed by them appropriate, made their own credit analysis and decision
to enter into ABL Loan Documents and be bound by the terms of this Agreement, and they will
continue to make their own credit decision in taking or not taking any action under the ABL Loan
Documents or this Agreement. The Notes Agent, on behalf of the Notes Claimholders, acknowledges
that it and the other Notes Claimholders have, independently and without reliance on the ABL Agent
or any other ABL Claimholder, and based on documents and information deemed by them appropriate,
made their own credit analysis and decision to enter into each of the other Notes Documents and be
bound by the terms of this Agreement, and they will continue to make their own credit decision in
taking or not taking any action under the Notes Documents or this Agreement.



     7.2. No Warranties or Liability. The ABL Agent, on behalf of the ABL Claimholders,
acknowledges and agrees that none of the Notes Agent and the Notes Claimholders have made any
express or implied representation or warranty, including with respect to the execution, validity,
legality, completeness, collectibility or enforceability of any of the other Notes Documents, the
ownership by any Grantor of any Collateral or the perfection of any Liens thereon. Except as
otherwise provided in this Agreement, the Notes Agent and the Notes Claimholders will be entitled
to manage and supervise their respective loans and extensions of credit under the Notes Documents,
in accordance with law and as they may otherwise, in their sole discretion, deem appropriate. The
Notes Agent, on behalf of the Notes Claimholders, acknowledges and agrees that none of the ABL
Agent and the ABL Claimholders have made any express or implied representation or warranty,
including with respect to the execution, validity, legality, completeness, collectibility or
enforceability of any of the other ABL Loan Documents, the ownership by any Grantor of any
Collateral or the perfection of any Liens thereon. Except as otherwise provided in this Agreement,
the ABL Agent and the ABL Claimholders will be entitled to manage and
supervise their respective loans and extensions of credit under the ABL Loan Documents, in
accordance with law and as they may otherwise, in their sole discretion, deem appropriate. Except
as expressly provided herein (i) the Notes Agent and the Notes Claimholders shall have no duty to
the ABL Agent or any of the ABL Claimholders and (ii) the ABL Agent and the other ABL Claimholders
shall have no duty to the Notes Agent or any of the other Notes Claimholders, in each case, to act
or refrain from acting in a manner which allows, or results in, the occurrence or continuance of an
event of default or default under



-35-









 




any agreements any Grantor (including the ABL Loan Documents and
the Notes Documents), regardless of any knowledge thereof which they may have or be charged with.




     7.3. No Waiver of Lien Priorities.



     (a) No right of the Agents or the other Claimholders to enforce any provision of this
Agreement or any ABL Loan Document or Notes Document shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of any Grantor or by any act or failure to act by
such Agents or Claimholders or by any noncompliance by any Person with the terms, provisions and
covenants of this Agreement, any of the ABL Loan Documents or any of the Notes Documents,
regardless of any knowledge thereof which the Agents or the ABL Claimholders or the Notes
Claimholders, or any of them, may have or be otherwise charged with.



     (b) Without in any way limiting the generality of the foregoing paragraph (but subject to the
rights of the Grantors under the ABL Loan Documents and the Notes Documents and except as otherwise
expressly provided in this Agreement), the Agents and the other Claimholders may, at any time and
from time to time in accordance with the ABL Loan Documents and the Notes Documents and/or
applicable law, without the consent of, or notice to, any other Agent or any other Claimholder (as
applicable), without incurring any liabilities to such Persons and without impairing or releasing
the Lien priorities and other benefits provided in this Agreement (even if any right of subrogation
or other right or remedy is affected, impaired or extinguished thereby) do any one or more of the
following:




     (i) change the manner, place or terms of payment or change or extend the time of
payment of, or amend, renew, exchange, increase or alter, the terms of any of the
Obligations or any Lien or guaranty thereof or any liability of any Grantor, or any
liability incurred directly or indirectly in respect thereof (including any increase in or
extension of the Obligations, without any restriction as to the tenor or terms of any such
increase or extension) or otherwise amend, renew, exchange, extend, modify or supplement in
any manner any Liens held by the Agents or any rights or remedies under any of the ABL Loan
Documents or the Notes Documents;




     (ii) sell, exchange, release, surrender, realize upon, enforce or otherwise deal with
in any manner and in any order any part of the Collateral (except to the extent provided in
this Agreement) or any liability of any Grantor or any liability incurred directly or
indirectly in respect thereof;




     (iii) settle or compromise any Obligation or any other liability of any Grantor or any
security therefore or any liability incurred directly or indirectly in respect thereof and
apply any sums by whomsoever paid and however realized to any liability in any manner or
order that is not inconsistent with the terms of this Agreement; and




     (iv) exercise or delay in or refrain from exercising any right or remedy against any
security or any Grantor or any other Person, elect any remedy and otherwise deal freely with
any Grantor.



     7.4. Obligations Unconditional. All rights, interests, agreements and obligations of
the ABL Claimholders and the Notes Claimholders, respectively, hereunder shall remain in full force
and effect irrespective of:




     (a) any lack of validity or enforceability of any ABL Loan Documents or any Notes
Documents;



-36-









 






     (b) except, in each case, as otherwise expressly set forth in this Agreement, any
change in the time, manner or place of payment of, or in any other terms of, all or any of
the ABL Obligations or Notes Obligations, or any amendment or waiver or other modification,
including any increase in the amount thereof, whether by course of conduct or otherwise, of
the terms of any ABL Loan Document or Notes Document;




     (c) except as otherwise expressly set forth in this Agreement, any exchange, release,
voiding, avoidance or non-perfection of any security interest in any Collateral or any other
collateral, or any amendment, waiver or other modification, whether in writing or by course
of conduct or otherwise, of all or any of the ABL Obligations or Notes Obligations or any
guaranty thereof;




     (d) the commencement of any Insolvency or Liquidation Proceeding in respect of any
Grantor; or




     (e) any other circumstances which otherwise might constitute a defense available to, or
a discharge of, any Grantor in respect of the any Agent or Claimholder in respect of this
Agreement.



VIII.

MISCELLANEOUS.




     8.1. Conflicts. In the event of any conflict between the provisions of this Agreement
and the provisions of any ABL Loan Document or Notes Document, the provisions of this Agreement
shall govern and control.



     8.2. Effectiveness; Continuing Nature of this Agreement; Severability. This Agreement
shall become effective when executed and delivered by the parties hereto (it being understood that
this Agreement shall become effective among the Grantors, the ABL Claimholders and the Notes
Claimholders upon execution and delivery of this Agreement by the ABL Agent, the Notes Agent and
the Grantors party hereto on the date hereof). This is a continuing agreement of Lien
subordination (as opposed to an agreement of debt or claim subordination), and the ABL Claimholders
and the Notes Claimholders may continue, at any time and without notice to any other Agent or
Claimholder, to extend credit and other financial accommodations and lend monies to or for the
benefit of any Grantor in reliance hereon. Each of the Agents, on behalf of the applicable
Claimholders, as applicable, hereby irrevocably, absolutely, and unconditionally waives any right
any Claimholder may have under applicable law to revoke this Agreement or any of the provisions of
this Agreement. The terms of this Agreement shall survive, and shall continue in full force and
effect, in any Insolvency or Liquidation Proceeding. Consistent with, but not in limitation of,
the preceding sentence, each of the Agents, on behalf of the applicable Claimholders irrevocably
acknowledges that this Agreement constitutes a “subordination agreement” within the meaning of both
New York law and Section 510(a) of the Bankruptcy Code. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall not invalidate the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. All references to any Grantor shall
include such Grantor as debtor and debtor-in-possession and any receiver or trustee for any Grantor
(as applicable) in any Insolvency or Liquidation Proceeding. This Agreement shall terminate
and be of no further force and effect subject to the rights provided to Prior Lien Claimholders
under Section 6.4:




     (a) with respect to the ABL Agent, the ABL Claimholders and the ABL Obligations, the
date on which the Discharge of ABL Obligations has occurred in accordance with the terms of
this Agreement; and




-37-











 






     (b) with respect to the Notes Agent, the Notes Claimholders and the Notes Obligations,
the date on which the Discharge of Notes Obligations has occurred in accordance with the
terms of this Agreement.



     8.3. Amendments; Waivers. Except as provided in the following sentence, no amendment,
modification or waiver of any of the provisions of this Agreement shall be deemed to be made unless
the same shall be in writing signed on behalf of each party hereto or its authorized agent and each
waiver, if any, shall be a waiver only with respect to the specific instance involved and shall in
no way impair the rights of the parties making such waiver or the obligations of the other parties
to such party in any other respect or at any other time. Notwithstanding the foregoing, no Grantor
shall have any right to consent to or approve any amendment, modification or waiver of any
provision of this Agreement except to the extent its rights are directly affected or any liability
or obligation is imposed on it or any existing liability or obligations is increased.



     8.4. Information Concerning Financial Condition of the Company and Their Subsidiaries.
Each Agent and Claimholder shall be responsible for keeping themselves informed of (a) the
financial condition of the Grantors and (b) all other circumstances bearing upon the risk of
nonpayment of the ABL Obligations and the Notes Obligations. No Claimholder shall have any duty to
advise any other Claimholder of information known to it or them regarding such condition or any
such circumstances or otherwise. In the event any Agent or other Claimholder undertakes at any
time or from time to time to provide any such information to any of the other Claimholders, it or
they shall be under no obligation, (i) to make, and shall not make, any express or implied
representation or warranty, including with respect to the accuracy, completeness, truthfulness or
validity of any such information so provided, (ii) to provide any additional information or to
provide any such information on any subsequent occasion, (iii) to undertake any investigation, or
(iv) to disclose any information, which pursuant to accepted or reasonable commercial finance
practices, such party wishes to maintain confidential or is otherwise required to maintain
confidential.



     8.5. Subrogation. With respect to the value of any payments or distributions in cash,
property or other assets that any of the Subordinated Lien Claimholders actually pay over to the
Prior Lien Agent or the Prior Lien Claimholders under the terms of this Agreement, the Subordinated
Lien Claimholders shall be subrogated to the rights of such Prior Lien Claimholders;
provided, however, that each Subordinated Lien Agent, on behalf of the Subordinated
Lien Claimholders, hereby agrees not to assert or enforce all such rights of subrogation it may
acquire as a result of any payment hereunder until the Discharge of Prior Lien Obligations has
occurred. The Grantors acknowledge and agree that, to the extent permitted by applicable law, the
value of any payments or distributions in cash, property or other assets received by the
Subordinated Lien Claimholders that are paid over to the Prior Lien Claimholders pursuant to this
Agreement shall not reduce any of the Subordinated Lien Obligations. Notwithstanding the foregoing
provisions of this Section 8.5, none of the Subordinated Lien Claimholders shall have any
claim against any of the Prior Lien Claimholders for any impairment of any subrogation rights
herein granted to the Subordinated Lien Claimholders.



     8.6. SUBMISSION TO JURISDICTION; WAIVERS.



     (a) ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY PERSON ARISING OUT OF OR RELATING HERETO MAY
BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF
NEW YORK. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH AGENT, FOR ITSELF AND ON BEHALF OF THE
NOTES CLAIMHOLDERS (IN THE CASE OF THE NOTES AGENT) AND THE ABL CLAIMHOLDERS (IN THE CASE OF THE
ABL AGENT) IRREVOCABLY:



-38-









 






     (1) AGREES THAT THE ONLY NECESSARY PARTIES TO ANY AND ALL JUDICIAL PROCEEDINGS
ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE THE PARTIES HERETO, EXCEPT
WHERE IN ANY SUCH JUDICIAL PROCEEDING RELIEF (INCLUDING INJUNCTIVE RELIEF OR THE
RECOVERY OF MONEY) IS BEING SOUGHT DIRECTLY AGAINST OR FROM A PERSON THAT IS NOT A
PARTY AND EXCEPT THAT, IN ANY SUCH JUDICIAL PROCEEDINGS AMONG ANY NOTES AGENT OR ABL
AGENT THAT DOES NOT SEEK ANY RELIEF AGAINST OR FROM ANY GRANTOR, THE GRANTORS SHALL
NOT BE NECESSARY PARTIES. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, AND
CONSISTENT WITH THE PROVISIONS OF SECTIONS 8.14 AND 8.17, NONE OF
THE ABL CLAIMHOLDERS (OTHER THAN THE ABL AGENT) OR THE NOTES CLAIMHOLDERS (OTHER
THAN THE NOTES AGENT) SHALL BE NECESSARY OR OTHERWISE APPROPRIATE PARTIES TO ANY
SUCH JUDICIAL PROCEEDINGS, UNLESS IN SUCH JUDICIAL PROCEEDING SUMS ARE BEING SOUGHT
TO BE RECOVERED DIRECTLY FROM SUCH PERSONS, INCLUDING PURSUANT TO SECTION
4.2 OR THE PROVISIONS OF THIS AGREEMENT ARE SEEKING TO BE ENFORCED DIRECTLY
AGAINST SUCH PERSONS.




     (2) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND
VENUE OF SUCH COURTS;




     (3) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;




     (4) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE
APPLICABLE PERSON (AND IN THE CASE OF A PARTY, AT ITS ADDRESS PROVIDED IN ACCORDANCE
WITH SECTION 8.7); AND




     (5) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (3) ABOVE IS SUFFICIENT TO CONFER
PERSONAL JURISDICTION OVER THE APPLICABLE PERSON IN ANY SUCH PROCEEDING IN ANY SUCH
COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT.



     (b) WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS AGREEMENT, ANY OF THE ABL LOAN DOCUMENTS OR ANY OF THE NOTES DOCUMENTS. EACH
OF THE PARTIES 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, THE ABL LOAN DOCUMENTS AND THE NOTES
DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 8.6.



     8.7. Notices. All notices permitted or required under this Agreement need be sent
only to the Notes Agent and the ABL Agent, as applicable, in order to be effective and otherwise
binding on any applicable Claimholder. If any notice is sent for whatever reason to the other
Notes Claimholders or the



-39-









 




ABL Claimholders, such notice shall also be sent to the applicable Agent. Unless otherwise
specifically provided herein, any notice hereunder shall be in writing and may be personally
served, telexed or sent by telefacsimile or United States mail or courier service and shall be
deemed to have been given when delivered in person or by overnight courier service and signed for
against receipt thereof, upon receipt of telefacsimile or telex during normal business hours, or
three Business Days after depositing it in the United States certified mails (return receipt
requested) with postage prepaid and properly addressed. For the purposes hereof, the addresses of
the parties hereto shall be as set forth below each party’s name on the signature pages hereto, or,
as to each party, at such other address as may be designated by such party in a written notice to
all of the other parties.




     8.8. Further Assurances. The ABL Agent, on behalf of the ABL Claimholders, the Notes
Agent, on behalf of the Notes Claimholders, and the Grantors, agree that each of them shall take
such further action and shall execute and deliver such additional documents and instruments (in
recordable form, if requested) as any other Agent may reasonably request to effectuate the terms of
and the Lien priorities contemplated by this Agreement. Each of the Notes Agent and the ABL Agent
agrees that if it sends any Enforcement Notice to another Agent, it shall be sent all of the
Agents.



     8.9. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.



     8.10. Specific Performance. Each of the ABL Agent and the Notes Agent may demand
specific performance of this Agreement. The ABL Agent, on behalf of itself and the ABL
Claimholders, and the Notes Agent, on behalf of itself and the Notes Claimholders, hereby
irrevocably waive any defense based on the adequacy of a remedy at law and any other defense which
might be asserted to bar the remedy of specific performance in any action which may be brought by
the ABL Agent or the other ABL Claimholders or the Notes Agent or the other Notes Claimholders, as
applicable. Without limiting the generality of the foregoing or of the other provisions of this
Agreement, in seeking specific performance in any Insolvency or Liquidation Proceeding, an Agent
may seek such relief as if it were the “holder” of the claims of the other Agent’s Claimholders
under Section 1126(a) of the Bankruptcy Code or otherwise had been granted an irrevocable power of
attorney by the other Agent’s Claimholders.



     8.11. Headings. Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement for any other
purpose or be given any substantive effect.



     8.12. Counterparts. This Agreement may be executed in counterparts (and by different
parties hereto in different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. Delivery of an executed counterpart
of a signature page of this Agreement or any document or instrument delivered in connection
herewith by telecopy shall be effective as delivery of a manually executed counterpart of this
Agreement or such other document or instrument, as applicable.



     8.13. Authorization. By its signature, each party hereto represents and warrants to
the other parties hereto that the individual signing this Agreement on its behalf is duly
authorized to execute this Agreement. The Notes Agent hereby represents that it is authorized to,
and by its signature hereon does, bind the other Notes Claimholders to the terms of this Agreement.
The ABL Agent hereby represents that it is authorized to, and by its signature hereon does, bind
the other ABL Claimholders to the terms of this Agreement.



-40-









 





     8.14. No Third Party Beneficiaries. This Agreement and the rights and benefits hereof
shall inure to the benefit of each of the parties hereto and its respective successors and assigns
and shall inure to the benefit of (and shall be binding upon) each of the Agents and the other
Claimholders and their respective successors and assigns.



     8.15. Provisions Solely to Define Relative Rights. The provisions of this Agreement
are and are intended solely for the purpose of defining the respective relative rights of the ABL
Claimholders and the Notes Claimholders. No Grantor or any other creditor thereof shall have any
rights hereunder, and no Grantor may rely on the terms hereof. Nothing in this Agreement is
intended to or shall impair as between the Grantors and the ABL Agent and the other ABL
Claimholders, or as between the Grantors and the Notes Agent and the other Notes Claimholders, the
obligations of any Grantor, which are absolute and unconditional, to pay principal, interest, fees
and other amounts as provided in the other ABL Loan Documents or the other Notes Documents,
respectively, including as and when the same shall become due and payable in accordance with their
terms.



     8.16. Marshalling of Assets. Each Subordinated Lien Agent, on behalf of the
applicable Subordinated Lien Claimholders, hereby irrevocably, absolutely, and unconditionally
waives any and all rights or powers any Subordinated Lien Claimholder may have at any time under
applicable law or otherwise to have its Subordinated Lien Collateral, or any part thereof,
marshaled upon any foreclosure or other enforcement of such Subordinated Lien Agent’s Liens.



     8.17. Exclusive Means of Exercising Rights under this Agreement. The Notes
Claimholders shall be deemed to have irrevocably appointed the Notes Agent and the ABL Claimholders
shall be deemed to have irrevocably appointed the ABL Agent, as their respective and exclusive
agents hereunder. Consistent with such appointment, the Notes Claimholders, and the ABL
Claimholders further shall be deemed to have agreed that their respective Agents (and not any
individual Claimholder or group of Claimholders) shall have the exclusive right to exercise any
rights, powers, and/or remedies under or in connection with this Agreement (including bringing any
action to interpret or otherwise enforce the provisions of this Agreement) or the Collateral.
Specifically, but without limiting the generality of the foregoing, each Notes Claimholder (other
than the Notes Agent) and each ABL Claimholder (other than the ABL Agent), shall not be entitled to
take or file, but instead shall be precluded from taking or filing (whether in any Insolvency or
Liquidation Proceeding or otherwise), any action, judicial or otherwise, to enforce any right or
power or pursue any remedy under this Agreement (including any declaratory judgment or other action
to interpret or otherwise enforce the provisions of this Agreement), except solely as provided in
the proviso in the preceding sentence.



     8.18. Interpretation. This Agreement is a product of negotiations among
representatives of, and has been reviewed by counsel to, the Notes Agent, the ABL Agent and the
Grantors and is the product of those Persons on behalf of themselves and the Notes Claimholders (in
the case of the Notes Agent) and the ABL Claimholders (in the case of the ABL Claimholders).
Accordingly, this Agreement’s provisions shall not be construed against, or in favor of, any part
or other Person merely by virtue of that party or other Person’s involvement, or lack of
involvement, in the preparation of this Agreement and of any of its specific provisions.



     8.19. Capacity of Notes Agent. The Bank of New York Mellon Trust Company, N.A. is
entering into this Agreement in its capacity as “trustee” and “collateral agent” under the Notes
Indenture and the rights, powers, privileges and protections afforded to the “trustee” and
“collateral agent” under the Notes Indenture shall also apply to The Bank of New York Mellon Trust
Company, N.A. as the Notes Agent hereunder. The Notes Claimholders have expressly authorized and
instructed the Notes Agent to execute and deliver this Agreement. For the avoidance of doubt, the
Notes Trustee shall have no



-41-









 




obligation, duty or liability to any holder or representative of Additional Pari Passu Secured
Indebtedness Obligations except to the extent agreed to by the Notes Trustee and such holders and
representative.




[Signature Pages Follow]



-42-









 





     IN WITNESS WHEREOF, the parties hereto have executed this Intercreditor Agreement as of the
date first written above.



	 	 	 	 	 
	 	ABL Agent:




JPMORGAN CHASE BANK, N.A.,

as Initial ABL Agent and not in its individual capacity

 	 
	 	By:  	/s/ Matthew A. Brewer
 	 
	 	 	Name:  	Matthew A. Brewer 	 
	 	 	Title:  	Vice President 	 
	 
	 	
Notice Address:



Chase Business Credit

1300 E. Ninth Street

Cleveland, Ohio 44114

Attn: Matthhew Brewer and Libbey Glass Account Manager

Facsimile No.: 216-781-2071

Notes Agent:



THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., not in its individual capacity, but solely in its

capacity as Trustee and Collateral Agent under the

Notes Indenture and Collateral Agent under the Notes

Documents, as Notes Agent 	 
	 	 	 
	 	By:  	                    /s/ Linda E. Garcia
 	 
	 	 	Name:  	Linda E. Garcia 	 
	 	 	Title:  	Vice President 	 
	 
	 	Notice Address:



2 North LaSalle Street, Suite 1020

Chicago, Illinois 60602

Attn: Linda Garcia, Global Corporate Trust

 	 



Signature Page to Intercreditor Agreement



 









 







Acknowledged and Agreed to by:



Company:



LIBBEY GLASS INC.



	 	 	 	 	 
	 	 
	By:  	   /s/ Susan A. Kovach
 	 
	 	Name:  	Susan A. Kovach 	 
	 	Title:  	Vice President, General Counsel & Secretary 	 
	 



Notice Address:



300 Madison Avenue

Toledo, Ohio 43604

Facsimile (419) 325-2585

Attention: Susan A. Kovach, General Counsel



with a copy to:



Latham & Watkins LLP

233 South Wacker Drive, Suite 5800

Chicago, Illinois 60606

Facsimile (312) 993-9767

Attention: Christopher D. Lueking




Holdings:




LIBBEY INC.




	 	 	 	 	 
	 	 
	By:  	       /s/ Susan A. Kovach
 	 
	 	Name:  	Susan A. Kovach 	 
	 	Title:  	Vice President, General Counsel & Secretary 	 
	 



Notice Address:



300 Madison Avenue

Toledo, Ohio 43604

Facsimile (419) 325-2585

Attention: Susan A. Kovach, General Counsel



with a copy to:



Latham & Watkins LLP

233 South Wacker Drive, Suite 5800

Chicago, Illinois 60606

Facsimile (312) 993-9767

Attention: Christopher D. Lueking






Signature Page to Intercreditor Agreement




 









 








Company Subsidiaries:




Syracuse China Company — Incorporated in Delaware

World Tableware Inc. — Incorporated in Delaware

LGA4 Corp. — Incorporated in Delaware

LGA3 Corp. — Incorporated in Delaware

The Drummond Glass Company — Incorporated in Delaware

LGC Corp. — Incorporated in Delaware

Traex Company — Incorporated in Delaware

Libbey.com LLC — Formed in Delaware

LGFS Inc. — Incorporated in Delaware

LGAC LLC — Formed in Delaware




	 	 	 	 	 
	 	 
	By:  	         /s/ Susan A. Kovach
 	 
	 	Name:  	Susan A. Kovach 	 
	 	Title:  	Vice President, General Counsel & Secretary 	 
	 



Notice Address:



300 Madison Avenue

Toledo, Ohio 43604

Facsimile (419) 325-2585

Attention: Susan A. Kovach, General Counsel



with a copy to:



Latham & Watkins LLP

233 South Wacker Drive, Suite 5800

Chicago, Illinois 60606

Facsimile (312) 993-9767

Attention: Christopher D. Lueking






Signature Page to Intercreditor Agreement





 









 








EXHIBIT B TO THE

INTERCREDITOR AGREEMENT




[Form of]




ADDITIONAL JOINDER AGREEMENT



[Name of Additional Pari Passu Secured Indebtedness Agent]

[Address of Notes Agent]




[Date]




[Names of ABL Agent and Notes Agent]

[Addresses of ABL Agent and Notes Agent]





     The undersigned, together with its successors and assigns (the “New Agent”) under
[identify Additional Pari Passu Secured Indebtedness Agreement] (the “New Agreement”), is
the Additional Pari Passu Secured Indebtedness Agent for Persons (the “New Claimholders”)
wishing to become Notes Claimholders under and as defined in the Intercreditor Agreement dated as
of February 8, 2010 (as amended and/or supplemented from time to time, the “Intercreditor
Agreement” (terms used without definition herein have the meanings assigned to such terms by
the Intercreditor Agreement)) among the Company, Holdings, the Company Subsidiaries party thereto,
the ABL Agent thereunder and the Notes Agent thereunder.



     In consideration of the foregoing, the undersigned hereby:




     (i) represents that the New Claimholders have authorized the New Agent to become a
party to the Intercreditor Agreement on behalf of such New Claimholders and to act as the
Additional Pari Passu Secured Indebtedness Agent on behalf of such New Claimholders under
the Indenture;




     (ii) acknowledges that the New Agent has received a copy of the Intercreditor
Agreement;




     (iii) acknowledges on behalf of itself and the other New Claimholders that the
Obligations under the New Agreement constitute Notes Obligations for all purposes of the
Intercreditor Agreement; and




     (iv) accepts and acknowledges the terms of the Intercreditor Agreement applicable to
the Additional Pari Passu Secured Indebtedness Agent and the other Notes Claimholders and
agrees on its own behalf and on behalf of the New Claimholders to be bound by the terms
thereof applicable to holders of Notes Obligations, with all the rights, duties and
obligations of the Notes Claimholders under the Intercreditor Agreement and to be bound by
all the provisions thereof as fully as if they had been named as Notes Claimholders on the
effective date of the Intercreditor Agreement and agrees that the New Agent’s address for
receiving notices pursuant to the Intercreditor Agreement shall be as follows:



[Address]



     THIS ADDITIONAL JOINDER AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.



Ex B-1









 





     IN WITNESS WHEREOF, the undersigned has caused this Additional Joinder Agreement to be duly
executed by its authorized officer as of the ___ day of 20___.



	 	 	 	 	 
	 	[NAME OF NEW AGENT]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



The Company hereby represents and warrants

to each Agent on the date hereof that the

New Secured Agreement meets the

requirements set forth in the definition

of Additional Pari Passu Secured

Indebtedness Agreement.




Libbey Glass Inc., a Delaware Corporation




	 	 	 	 	 
	 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 




Ex. B-2