Exhibit 10.16


 


EXECUTION COPY


 




 





INTERCREDITOR AGREEMENT


 


dated as of


 


June 15, 2007,


 


among


 


STR ACQUISITION, INC.,


 


as Borrower,


 


STR HOLDINGS LLC


 


as Holdings,


 


the
Subsidiaries of the Borrower

from time to time party hereto,


 


CREDIT SUISSE,


 


as First Lien Collateral Agent


 


and


 


CREDIT SUISSE,


 


as Second Lien Collateral Agent


 


THIS IS THE INTERCREDITOR AGREEMENT REFERRED TO IN (A) THE FIRST
LIEN GUARANTEE AND COLLATERAL AGREEMENT OF EVEN DATE HEREWITH AMONG STR
ACQUISITION, INC., STR HOLDINGS LLC, CERTAIN SUBSIDIARIES OF STR ACQUISITION,
INC. AND CREDIT SUISSE, AS FIRST LIEN COLLATERAL AGENT, (B) THE SECOND
LIEN GUARANTEE AND COLLATERAL AGREEMENT OF EVEN DATE HEREWITH AMONG STR
ACQUISITION, INC., STR HOLDINGS LLC, CERTAIN SUBSIDIARIES OF STR ACQUISITION, INC.
AND CREDIT SUISSE, AS SECOND LIEN COLLATERAL AGENT, AND (C) THE OTHER
SECURITY DOCUMENTS REFERRED TO IN THE CREDIT AGREEMENTS REFERRED TO HEREIN.




 





 

















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I

  	
   

  
	
   

  	
   

  	
   

  
	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.01.

  	
  Certain Defined Terms

  	
  2

  
	
  SECTION 1.02.

  	
  Other Defined Terms

  	
  2

  
	
  SECTION 1.03.

  	
  Terms Generally

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
   

  	
   

  
	
  LIEN PRIORITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 2.01.

  	
  Relative Priorities

  	
  7

  
	
  SECTION 2.02.

  	
  Prohibition on
  Contesting Liens

  	
  8

  
	
  SECTION 2.03.

  	
  No New Liens

  	
  8

  
	
  SECTION 2.04.

  	
  Similar Liens and
  Agreements

  	
  8

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
   

  	
   

  
	
  ENFORCEMENT OF
  RIGHTS; MATTERS RELATING TO COLLATERAL

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.01.

  	
  Exercise of Rights and
  Remedies

  	
  9

  
	
  SECTION 3.02.

  	
  No Interference

  	
  11

  
	
  SECTION 3.03.

  	
  Rights as Unsecured
  Creditors

  	
  13

  
	
  SECTION 3.04.

  	
  Automatic Release of
  Second Priority Liens

  	
  13

  
	
  SECTION 3.05.

  	
  Automatic Release of
  First Priority Liens

  	
  14

  
	
  SECTION 3.06.

  	
  Insurance and
  Condemnation Awards

  	
  14

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
   

  	
   

  
	
  PAYMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4.01.

  	
  Application of Proceeds

  	
  15

  
	
  SECTION 4.02.

  	
  Payment Over

  	
  15

  
	
  SECTION 4.03.

  	
  Certain Agreements with
  Respect to Unenforceable Liens

  	
  16

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
   

  	
   

  	
   

  
	
  BAILMENT FOR
  PERFECTION OF CERTAIN SECURITY INTERESTS

  	
   

  



 

















 


	
  ARTICLE VI

  	
   

  
	
   

  	
   

  	
   

  
	
  INSOLVENCY OR
  LIQUIDATION PROCEEDINGS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.01.

  	
  Finance and Sale
  Matters

  	
  17

  
	
  SECTION 6.02.

  	
  Relief from the
  Automatic Stay

  	
  19

  
	
  SECTION 6.03.

  	
  Reorganization
  Securities

  	
  19

  
	
  SECTION 6.04

  	
  Post-Petition Interest

  	
  19

  
	
  SECTION 6.05.

  	
  Certain Waivers by the
  Second Lien Secured Parties

  	
  19

  
	
  SECTION 6.06.

  	
  Certain Voting Matters

  	
  20

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
   

  	
   

  	
   

  
	
  OTHER AGREEMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 7.01.

  	
  Matters Relating to
  Loan Documents

  	
  20

  
	
  SECTION 7.02.

  	
  Effect of Refinancing
  of Indebtedness under First Lien Loan Documents 

  	
  22 

  
	
  SECTION 7.03.

  	
  No Waiver by First Lien
  Secured Parties

  	
  23

  
	
  SECTION 7.04.

  	
  Reinstatement

  	
  23

  
	
  SECTION 7.05.

  	
  Further Assurances

  	
  23

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  
	
   

  	
   

  	
   

  
	
  REPRESENTATIONS
  AND WARRANTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 8.01.

  	
  Representations and
  Warranties of Each Party

  	
  23

  
	
  SECTION 8.02.

  	
  Representations and
  Warranties of Each Collateral Agent

  	
  24

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  
	
   

  	
   

  	
   

  
	
  NO RELIANCE; NO
  LIABILITY; OBLIGATIONS ABSOLUTE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9.01.

  	
  No Reliance;
  Information

  	
  24

  
	
  SECTION 9.02.

  	
  No Warranties or
  Liability

  	
  25

  
	
  SECTION 9.03.

  	
  Obligations Absolute

  	
  25

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  
	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.01. 

  	
  Notices

  	
  26

  
	
  SECTION 10.02. 

  	
  Conflicts

  	
  27

  
	
  SECTION 10.03. 

  	
  Effectiveness; Survival

  	
  27

  
	
  SECTION 10.04. 

  	
  Severability

  	
  27

  
	
  SECTION 10.05. 

  	
  Amendments; Waivers

  	
  27

  
	
  SECTION 10.06. 

  	
  Subrogation

  	
  28

  
	
  SECTION 10.07. 

  	
  Applicable Law;
  Jurisdiction; Consent to Service of Process

  	
  28

  
	
  SECTION 10.08. 

  	
  Waiver of Jury Trial

  	
  29

  
	
  SECTION 10.09. 

  	
  Parties in Interest

  	
  29

  
	
  SECTION 10.10. 

  	
  Specific Performance

  	
  29

  
	
  SECTION 10.11. 

  	
  Headings

  	
  29

  



 


ii

















 


	
  SECTION 10.12. 

  	
  Counterparts

  	
  29

  
	
  SECTION 10.13. 

  	
  Provisions Solely to
  Define Relative Rights

  	
  29

  



 


iii

















 


INTERCREDITOR AGREEMENT dated as of June 15, 2007
(this “Agreement”), STR
ACQUISITION, INC., a Delaware corporation, which substantially simultaneously
with the execution hereof shall be merged with and into SPECIALIZED TECHNOLOGY
RESOURCES, INC., a Delaware corporation (the “Borrower”), STR HOLDINGS LLC, a Delaware limited liability
company (“Holdings”),
CREDIT SUISSE, as collateral agent for the First Lien Lenders (as
defined below) (in such capacity the “First Lien Collateral Agent”),
and CREDIT SUISSE, as collateral agent for the Second Lien Lenders (as
defined below) (in such capacity, the “Second
Lien Collateral Agent”).


 


PRELIMINARY STATEMENT


 


Reference is made
to (a) the First Lien Credit Agreement dated as of June 15, 2007 (the
“First Lien Credit
Agreement”), among the Borrower, Holdings, the lenders
from time to time party thereto (the “First Lien Lenders”) and Credit Suisse, as administrative
agent for the First Lien Lenders (in such capacity, the “First Lien Administrative Agent”) and First Lien Collateral Agent, (b) the
Second Lien Credit Agreement dated as of June 15, 2007 (the “Second Lien Credit
Agreement” and, together with the First Lien Credit
Agreement, the “Credit
Agreements”), among the Borrower, Holdings, the lenders
from time to time party thereto (the “Second Lien Lenders”) and Credit Suisse, as
administrative agent for the Second Lien Lenders(in such capacity, the “Second  Lien Administrative Agent”) and Second Lien
Collateral Agent, (c) the First Lien Guarantee and
Collateral Agreement dated as of June 15, 2007 (the “First Lien Guarantee and
Collateral Agreement”), among the Borrower, Holdings, the
subsidiaries of the Borrower from time to time party thereto and Credit Suisse
as First Lien Collateral Agent, (d) the Second Lien Guarantee and
Collateral Agreement dated as of June 15, 2007 (the “Second Lien Guarantee and
Collateral Agreement”), among the Borrower, Holdings, the
subsidiaries of the Borrower from time to time party thereto and Credit Suisse
as Second Lien Collateral Agent, and (e) the other Security Documents
referred to in the Credit Agreements.


 


RECITALS


 


A.   The First Lien Lenders have
agreed to make loans and other extensions of credit to the Borrower pursuant to
the First Lien Credit Agreement on the condition, among others, that the First
Lien Obligations (such term and each other capitalized term used but not
defined in the preliminary statement or these recitals having the meaning given
it in Article I) shall be secured by first priority Liens on, and security
interests in, the Collateral.


 


B.    The Second Lien Lenders have
agreed to make loans to the Borrower pursuant to the Second Lien Credit
Agreement on the condition, among others, that the


 

















 


Second Lien Obligations
shall be secured by second priority Liens on, and security interests in, the
Collateral.


 


C.
The Credit Agreements require, among other things, that the parties thereto set
forth in this Agreement, among other things, their respective rights, obligations
and remedies with respect to the Collateral.


 


Accordingly, the parties hereto agree as follows:


 


ARTICLE I


 


Definitions


 


SECTION 1.01.
Certain Defined Terms. Capitalized terms used in this Agreement
and not otherwise defined herein shall have the meanings set forth in the First
Lien Credit Agreement, the Second Lien Credit Agreement, the First Lien
Guarantee and Collateral Agreement or the Second Lien Guarantee and Collateral
Agreement, as applicable.


 


SECTION 1.02.
Other Defined Terms. As used in the Agreement, the following
terms shall have the meanings specified below:


 


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


 


“Bankruptcy
Law”  shall mean the
Bankruptcy Code and any other Federal, state or foreign bankruptcy, insolvency,
receivership or similar law.


 


“Borrower”  shall have the meaning assigned to such
term in the preamble to this Agreement.


 


“Cap Amount”  shall have the meaning assigned to such
term in Section 7.01(a)(ii).


 


“Collateral” shall mean, collectively, the First Lien
Collateral and the Second Lien Collateral.


 


“Collateral Agents”  shall mean the First Lien Collateral
Agent and the Second Lien Collateral Agent.


 


“Comparable Second Lien Security
Document”  shall
mean, in relation to any Collateral subject to any Lien created under any First
Lien Security Document, the Second Lien Security Document that creates a Lien
on the same Collateral, granted by the same Grantor.


 


“Credit Agreements” shall have the meaning assigned to such
term in the preliminary statement of this Agreement.


 


2

















 


‘‘DIP Cap Amount”  shall mean the Cap Amount determined
without giving effect to clause (A)(2) of the definition thereof.


 


“DIP Financing”  shall have the meaning assigned to such
term in Section 6.01(a).


 


“DIP Financing Liens”  shall have the meaning assigned to such
term in Section 6.01(a).


 


“Discharge of First Lien Obligations”  shall mean, subject to Sections 7.02 and
7.04, (a) payment in full in cash of the principal of and interest (including
interest accruing during the pendency of any Insolvency or Liquidation Proceeding,
regardless of whether allowed or allowable in such Insolvency or Liquidation Proceeding)
and premium, if any, on all Indebtedness outstanding under the First Lien Loan
Documents, (b) payment in full of all other First Lien Obligations that
are due and payable or otherwise accrued and owing at or prior to the time such
principal and interest are paid, (c) cancellation of or the entry into
arrangements satisfactory to the First Lien Administrative Agent and the
Issuing Bank with respect to all letters of credit issued and outstanding under
the First Lien Credit Agreement and (d) termination or expiration of all commitments
to lend and all obligations to issue or extend letters of credit under the
First Lien Credit Agreement.


 


“Disposition” shall mean any sale, lease, exchange,
transfer or other disposition. “Dispose” shall have a correlative meaning.


 


“First Lien Administrative Agent”  shall have the meaning assigned to such
term in the preliminary statement of this Agreement.


 


“First Lien Collateral”  shall mean all “Collateral”, as defined
in the First Lien Guarantee and Collateral Agreement, and any other assets of
any Grantor now or at any time hereafter subject to Liens securing any First
Lien Obligations.


 


“First Lien Collateral Agent”  shall have the meaning assigned to such term
in the preamble to this Agreement.


 


“First Lien Credit Agreement”  shall have the meaning assigned to such term
in the preliminary statement of this Agreement.


 


“First Lien Guarantee and
Collateral Agreement”  shall
have the meaning assigned to such term in the preliminary statement of this
Agreement.


 


“First Lien Lenders”  shall have the meaning assigned to such
term in the preliminary statement of this Agreement.


 


‘‘First Lien Loan Documents”  shall mean the “Loan Documents” as defined
in the First Lien Credit Agreement.


 


3

















 


“First Lien Mortgages” shall
mean, collectively, each mortgage, deed of trust, assignment of leases and
rents, modifications and any other agreement, document or instrument pursuant
to which a Lien on real property is granted to secure any First Lien
Obligations or under which rights or remedies with respect to any such Lien are
governed.


 


“First Lien Obligations”  shall mean the “Obligations”, as defined
in the First Lien Guarantee and Collateral Agreement.


 


“First Lien Required Lenders”  shall mean the “Required Lenders”, as defined
in the First Lien Credit Agreement.


 


“First Lien Secured Parties”  shall mean, at any time, (a) the
First Lien Lenders, (b) the First Lien Administrative Agent (c) the
First Lien Collateral Agent, (d) the Issuing Bank, (e) each other
person to whom any of the First Lien Obligations (including First Lien
Obligations under any Hedging Agreement and indemnification obligations) is
owed and (f) the successors and assigns of each of the foregoing.


 


“First Lien Security Documents”  shall mean the “Security Documents”, as
defined in the First Lien Credit Agreement, and any other agreement, document
or instrument pursuant to which a Lien is granted to secure any First Lien
Obligations or under which rights or remedies with respect to any such Lien are
governed.


 


“First Priority Liens”  shall mean all Liens on the First Lien
Collateral securing the First Lien Obligations, whether created under the First
Lien Security Documents or acquired by possession, statute (including any
judgment lien), operation of law, subrogation or otherwise.


 


“Grantors”  shall mean Holdings, the Borrower and
each other person that shall have created or purported to create any First
Priority Lien or Second Priority Lien on all or any part of its assets to
secure any First Lien Obligations or any Second Lien Obligations.


 


“Guarantors”  shall mean, collectively, Holdings and
each Subsidiary that has Guaranteed, or that may from time to time hereafter
Guarantee, the First Lien Obligations or the Second Lien Obligations, whether
by executing and delivering the applicable Guarantee and Collateral Agreement,
a supplement thereto or otherwise.


 


“Indebtedness”  shall mean and includes all obligations
that constitute “Indebtedness”, as defined in the First Lien Credit Agreement
or the Second Lien Credit Agreement, as applicable.


 


“Insolvency or Liquidation
Proceeding” shall mean (a) any voluntary or involuntary
proceeding under the Bankruptcy Code or any other Bankruptcy Law with respect
to any Grantor, (b) any voluntary or involuntary appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for
any Grantor or for a substantial part of the property or assets of any Grantor,
(c) any voluntary or involuntary


 


4

















 


winding-up or liquidation
of any Grantor, or (d) a general assignment for the benefit of creditors
by any Grantor.


 


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


 


“Loan Documents”  shall mean the First Lien Loan Documents
and the Second Lien Loan Documents.


 


“New First Lien Collateral Agent”  shall have the meaning assigned to such
term in Section 7.02.


 


“New First Lien Loan Documents”  shall have the meaning assigned to such
term in Section 7.02.


 


“New First Lien Obligations”  shall have the meaning assigned to such term
in Section 7.02.


 


“Pledged or Controlled Collateral”  shall have the meaning assigned to such
term in Article V.


 


“Refinance” shall
mean, in respect of any Indebtedness, to refinance, extend, renew, restructure
or replace or to issue other Indebtedness in exchange or replacement for, such
Indebtedness, in whole or in part. “Refinanced”  and
“Refinancing” shall
have correlative meanings.


 


“Refinancing Notice”  shall have the meaning assigned to such
term in Section 7.02.


 


“Release”  shall have the meaning assigned to such term in Section 3.04.


 


“Second Lien Administrative Agent”  shall have the meaning assigned to such
term in the preliminary statement of this Agreement.


 


“Second Lien Collateral”  shall mean all “Collateral”, as defined
in the Second Lien Guarantee and Collateral Agreement, and any other assets of
any Grantor now or at any time hereafter subject to Liens securing any Second
Lien Obligations.


 


“Second Lien Collateral Agent”  shall have the meaning assigned to such term
in the preamble to this Agreement.


 


“Second Lien Credit Agreement”  shall have the meaning assigned to such term
in the preliminary statement of this Agreement.


 


5














 


“Second Lien Guarantee and
Collateral Agreement”  shall
have the meaning assigned to such term in the preliminary statement of this
Agreement.


 


“Second Lien Lenders”  shall have the meaning assigned to such
term in the preliminary statement of this Agreement.


 


“Second Lien Loan Documents”  shall mean the “Loan Documents”, as defined
in the Second Lien Credit Agreement.


 


“Second Lien Mortgages”  shall mean, collectively, each mortgage,
deed of trust, leasehold mortgage, assignment of leases and rents, modifications
and any other agreement, document or instrument pursuant to which any Lien on
real property is granted to secure any Second Lien Obligations or under which
rights or remedies with respect to any such Lien are governed.


 


“Second Lien Obligations”  shall mean the “Obligations”, as defined
in the Second Lien Guarantee and Collateral Agreement.


 


“Second Lien Permitted Actions”  shall have the meaning assigned to such term
in Section 3.01(a).


 


“Second Lien Required Lenders”  shall mean the “Required Lenders”, as defined
in the Second Lien Credit Agreement.


 


“Second Lien Secured Parties”  shall mean, at any time, (a) the
Second Lien Lenders, (b) the Second Lien Administrative Agent, (c) the
Second Lien Collateral Agent, (d) each other person to whom any of the Second
Lien Obligations (including indemnification obligations) is owed and (e) the
successors and assigns of each of the foregoing.


 


“Second Lien Security Documents”  shall mean the “Security Documents”, as
defined in the Second Lien Credit Agreement, and any other agreement, document
or instrument pursuant to which a Lien is granted to secure any Second Lien Obligations
or under which rights or remedies with respect to any such Lien are governed.


 


“Second Priority Liens” shall
mean all Liens on the Second Lien Collateral securing the Second Lien
Obligations, whether created under the Second Lien Security Documents or
acquired by possession, statute (including any judgment lien), operation of
law, subrogation or otherwise.


 


“Security Documents”  shall mean the First Lien Security
Documents and the Second Lien Security Documents.


 


“Standstill Period”  shall have the meaning assigned to such
term in Section 3.02(a).


 


6

















 


“subsidiary”  shall mean, with respect to any person
(herein referred to as the “parent”), any corporation,
partnership, limited liability company, association or other business entity (a) of
which securities or other ownership interests representing more than 50% of the
equity or more than 50% of the ordinary voting power or more than 50% of the
general partnership or membership interests are, at the time any determination is
being made, owned, Controlled or held, or (b) that is, at the time any
determination is made, otherwise Controlled, by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent.


 


“Subsidiary”  shall mean any subsidiary of the Borrower.


 


“Uniform
Commercial Code”  or “UCC”  shall mean the Uniform Commercial Code (or any
similar or equivalent legislation) as in effect from time to time in any
applicable jurisdiction.


 


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


 


ARTICLE II


 


Lien Priorities


 


SECTION 2.01.
Relative Priorities. Notwithstanding the date, manner or order
of grant, attachment or perfection of any Second Priority Lien or any First
Priority Lien, and notwithstanding any provision of the UCC or any other
applicable law or the provisions of any Security Document or any other Loan
Document or any other circumstance whatsoever, the Second Lien Collateral Agent,
for itself and on behalf of the other Second Lien Secured Parties, hereby
agrees that, so long as the Discharge of First Lien Obligations has not
occurred, (a) any First Priority Lien now or hereafter held


 


7

















 


by or for the benefit of
any First Lien Secured Party shall be senior in right, priority, operation,
effect and all other respects to any and all Second Priority Liens and (b) any
Second Priority Lien now or hereafter held by or for the benefit of any Second
Lien Secured Party shall be junior and subordinate in right, priority,
operation, effect and all other respects to any and all First Priority Liens.
The First Priority Liens shall be and remain senior in right, priority,
operation, effect and all other respects to any Second Priority Liens for all
purposes, whether or not any First Priority Liens are subordinated in any
respect to any other Lien securing any other obligation of the Borrower, any
other Grantor or any other person.


 


SECTION 2.02.
Prohibition on Contesting Liens.  Each of the First Lien Collateral Agent,
for itself and on behalf of the other First Lien Secured Parties, and the Second
Lien Collateral Agent, for itself and on behalf of the other Second Lien
Secured Parties, agrees that it will not, and hereby waives any right to,
contest or support any other person in contesting, in any proceeding (including
any Insolvency or Liquidation Proceeding), the priority, validity or
enforceability of any Second Priority Lien or any First Priority Lien, as the
case may be; provided that
nothing in this Agreement shall be construed to prevent or impair the rights of
the First Lien Collateral Agent or any other First Lien Secured Party to
enforce this Agreement.


 


SECTION 2.03.
No New Liens. The parties hereto agree that, so long
as the Discharge of First Lien Obligations has not occurred, none of the
Grantors shall, or shall permit any of its subsidiaries to, (a) grant or
permit any additional Liens on any asset to secure any Second Lien Obligation
unless it has granted, or concurrently therewith grants, a Lien on such asset
to secure the First Lien Obligations or (b) grant or permit any additional
Liens on any asset to secure any First Lien Obligations unless it has granted,
or concurrently therewith grants, a Lien on such asset to secure the Second
Lien Obligations, with each such Lien to be subject to the provisions of this
Agreement. To the extent that the provisions of the immediately preceding
sentence are not complied with for any reason, without limiting any other right
or remedy available to the First Lien Collateral Agent or the other First Lien
Secured Parties, the Second Lien Collateral Agent agrees, for itself and on
behalf of the other Second Lien Secured Parties, that any amounts received by
or distributed to any Second Lien Secured Party pursuant to or as a result of
any Lien granted in contravention of this Section 2.03 shall be subject to
Section 4.02.


 


SECTION 2.04.
Similar Liens and Agreements.
The parties hereto acknowledge and agree that it is their intention
that the First Lien Collateral and the Second Lien Collateral be identical. In
furtherance of the foregoing, the parties hereto agree:


 


(a) to cooperate in good faith in order to
determine, upon any reasonable request by the First Lien Collateral Agent or
the Second Lien Collateral Agent, the specific assets included in the First
Lien Collateral and the Second Lien Collateral, the steps taken to perfect the
First Priority Liens and the Second Priority


 


8

















 


Liens thereon and
the identity of the respective parties obligated under the First Lien Loan
Documents and the Second Lien Loan Documents; and


 


(b) that the documents, agreements and
instruments creating or evidencing the Second Lien Collateral and the Second
Priority Liens shall be in all material respects in the same form as the
documents, agreements and instruments creating or evidencing the First Lien
Collateral and the First Priority Liens, other than with respect to the first
priority and second priority nature of the Liens created or evidenced
thereunder, the identity of the Secured Parties that are parties thereto or secured
thereby and other matters contemplated by this Agreement.


 


ARTICLE III


 


Enforcement of Rights; Matters
Relating to Collateral


 


SECTION 3.01.
Exercise of Rights and Remedies.  (a) So long as the Discharge of
First Lien Obligations has not occurred, whether or not any Insolvency or Liquidation
Proceeding has been commenced, the First Lien Collateral Agent and the other
First Lien Secured Parties shall have the exclusive right to enforce rights and
exercise remedies (including any right of setoff) with respect to the
Collateral (including making determinations regarding the release, Disposition
or restrictions with respect to the Collateral), or to commence or seek to
commence any action or proceeding with respect to such rights or remedies
(including any foreclosure action or proceeding or any Insolvency or
Liquidation Proceeding), in each case, without any consultation with or the consent
of the Second Lien Collateral Agent or any other Second Lien Secured Party; provided that, notwithstanding the foregoing,
(i) in any Insolvency or Liquidation Proceeding, the Second Lien
Collateral Agent may file a proof of claim or statement of interest with
respect to the Second Lien Obligations; (ii) the Second Lien Collateral Agent
may take any action to preserve or protect the validity and enforceability of
the Second Priority Liens, provided that
no such action is, or could reasonably be expected to be, (A) adverse to
the First Priority Liens or the rights of the First Lien Collateral Agent or
any other First Lien Secured Party to exercise remedies in respect thereof or (B) otherwise
inconsistent with the terms of this Agreement, including the automatic release
of Second Priority Liens provided in Section 3.04; (iii) the Second
Lien Secured Parties may file any responsive or defensive pleadings in
opposition to any motion, claim, adversary proceeding or other pleading made by
any person objecting to or otherwise seeking the disallowance of the claims of
the Second Lien Secured Parties, including any claims secured by the Collateral
or otherwise make any agreements or file any motions pertaining to the Second
Lien Obligations, in each case, to the extent not inconsistent with the terms
of this Agreement; (iv) the Second Lien Secured Parties may exercise
rights and remedies as unsecured creditors, as provided in Section 3.03;
and (v) subject to Section 3.02(a), the Second Lien Collateral
Agent and the other Second Lien Secured Parties may enforce any of their rights
and exercise any of their remedies with respect to the Collateral after the
termination of the Standstill Period (the actions described in this proviso
being referred to herein as the “Second
Lien Permitted Actions”).  Except
for the Second Lien Permitted Actions, unless and until the Discharge


 


9

















 


of First Lien Obligations
has occurred, the sole right of the Second Lien Collateral Agent and the other
Second Lien Secured Parties with respect to the Collateral shall be to receive
the proceeds of the Collateral, if any, remaining after the Discharge of First
Lien Obligations has occurred and in accordance with the Second Lien Loan
Documents and applicable law.


 


(b) In exercising rights and remedies with
respect to the Collateral, the First Lien Collateral Agent and the other First
Lien Secured Parties may enforce the provisions of the First Lien Loan
Documents and exercise remedies thereunder, all in such order and in such
manner as they may determine in their sole discretion. Such exercise and
enforcement shall include the rights of an agent appointed by them to Dispose
of Collateral upon foreclosure, to incur expenses in connection with any such
Disposition and to exercise all the rights and remedies of a secured creditor under
the Uniform Commercial Code, the Bankruptcy Code or any other Bankruptcy Law.
The First Lien Collateral Agent agrees to provide at least five days’ prior written
notice to the Second Lien Collateral Agent of its intention to foreclose upon or
Dispose of any Collateral.


 


(c) The Second Lien Collateral
Agent, for itself and on behalf of the other Second Lien Secured Parties,
hereby acknowledges and agrees that no covenant, agreement or restriction
contained in any Second Lien Security Document or any other Second Lien Loan
Document shall be deemed to restrict in any way the rights and remedies of the
First Lien Collateral Agent or the other First Lien Secured Parties with
respect to the Collateral as set forth in this Agreement and the other First
Lien Loan Documents.


 


(d) Notwithstanding anything in this Agreement to
the contrary, following the acceleration of the Indebtedness then outstanding
under the First Lien Credit Agreement, the Second Lien Secured Parties may, at
their sole expense and effort, upon notice to the Borrower and the First Lien
Collateral Agent, require the First Lien Secured Parties to transfer and assign
to the Second Lien Secured Parties, without warranty or representation or
recourse, all (but not less than all) of the First Lien Obligations; provided that (x) such assignment shall
not conflict with any law, rule or regulation or order of any court or
other Governmental Authority having jurisdiction, and (y) the Second Lien
Secured Parties shall have paid to the First Lien Collateral Agent, for the
account of the First Lien Secured Parties, in immediately available funds, an
amount equal to 100% of the principal of such Indebtedness plus all accrued and
unpaid interest thereon plus all accrued and unpaid Fees (as defined in the
First Lien Credit Agreement) plus all the other First Lien Obligations then
outstanding (which shall include, with respect to (i) the aggregate face
amount of the letters of credit outstanding under the First Lien Credit Agreement,
an amount in cash equal to 102% thereof, and (ii) Hedging Agreements that
constitute First Lien Obligations, 100% of the aggregate amount of such First Lien
Obligations (giving effect to any netting arrangements) that the applicable Loan
Party would be required to pay if such Hedging Agreements were terminated at
such time).   In order to effectuate the
foregoing, the First Lien Collateral Agent


 


10

















 


shall calculate, upon the written request of the
Second Lien Collateral Agent from time to time, the amount in cash that would
be necessary so to purchase the First Lien Obligations.


 


SECTION 3.02.
No Interference.  (a) The
Second Lien Collateral Agent, for itself and on behalf of the other Second Lien
Secured Parties, agrees that, whether or not any Insolvency or Liquidation
Proceeding has been commenced, the Second Lien Secured Parties:


 


(i) except for Second Lien Permitted Actions,
will not, so long as the Discharge of First Lien Obligations has not occurred, (A) enforce
or exercise, or seek to enforce or exercise, any rights or remedie, (including
any right of setoff) with respect to any Collateral (including the enforcement
of any right under any account control agreement, landlord waiver or bailee’s
letter or any similar agreement or arrangement to which the Second Lien
Collateral Agent or any other Second Lien Secured Party is a party) or (B) commence
or join with any person (other than the First Lien Collateral Agent) in
commencing, or petition for or vote in favor of any resolution for, any action
or proceeding with respect to such rights or remedies (including any
foreclosure action); provided, however, that
the Second Lien Collateral Agent may enforce or exercise any or all such rights
and remedies, or commence, join with any person in commencing, or petition for
or vote in favor of any resolution for, any such action or proceeding, after a
period of 180 days has elapsed since the date on which the Second Lien
Collateral Agent has delivered to the First Lien Collateral Agent written
notice of the acceleration of the Indebtedness then outstanding under the
Second Lien Credit Agreement (the “Standstill
Period”); provided further, however, that (A) notwithstanding
the expiration of the Standstill Period or anything herein to the contrary, in
no event shall the Second Lien Collateral Agent or any other Second Lien
Secured Party enforce or exercise any rights or remedies with respect to any
Collateral, or commence, join with any person in commencing, or petition for or
vote in favor of any resolution for, any such action or proceeding, if the
First Lien Collateral Agent or any other First Lien Secured Party shall have
commenced, and shall be diligently pursuing (or shall have sought or requested
relief from or modification of the automatic stay or any other stay in any
Insolvency or Liquidation Proceeding to enable the commencement and pursuit
thereof), the enforcement or exercise of any rights or remedies with respect to
any Collateral or any such action or proceeding (prompt written notice thereof
to be given to the Second Lien Collateral Agent by the First Lien Collateral Agent)
and (B) after the expiration of the Standstill Period, so long as neither the
First Lien Collateral Agent nor the First Lien Secured Parties have commenced
any action to enforce their Lien on any material portion of the Collateral, in
the event that and for so long as the Second Lien Secured Parties (or the
Second Lien Collateral Agent on their behalf) have commenced any actions to
enforce their Lien with respect to all or any material portion of the Collateral
to the extent permitted hereunder and are diligently pursuing such


 


11

















 


actions, neither
the First Lien Secured Parties nor the First Lien Collateral Agent shall take
any action of a similar nature with respect to such Collateral; provided that all other provisions of this
Intercreditor Agreement (including the turnover provisions of Article IV)
are complied with;


 


(ii) will not contest, protest or object to any
foreclosure action or proceeding brought by the First Lien Collateral Agent or
any other First Lien Secured Party, or any other enforcement or exercise by any
First Lien Secured Party of any rights or remedies relating to the Collateral
under the First Lien Loan Documents or otherwise, so long as Second Priority
Liens attach to the proceeds thereof subject to the relative priorities set
forth in Section 2.01;


 


(iii) subject to the rights of the Second Lien
Secured Parties under clause
(i) above, will not object to the forbearance by the First Lien Collateral
Agent or any other First Lien Secured Party from commencing or pursuing any
foreclosure action or proceeding or any other enforcement or exercise of any
rights or remedies with respect to the Collateral;


 


(iv) will not, so long as the Discharge of First
Lien Obligations has not occurred and except for Second Lien Permitted Actions,
take or receive any Collateral, or any proceeds thereof or payment with respect
thereto, in connection with the exercise of any right or enforcement of any
remedy (including any right of setoff) with respect to any Collateral or in
connection with any insurance policy award under a policy of insurance relating
to any Collateral or any condemnation award (or deed in lieu of condemnation) relating
to any Collateral;


 


(v) will not, except for Second Lien Permitted
Actions, take any action that would, or could reasonably be expected to,
hinder, in any manner, any exercise of remedies under the First Lien Loan
Documents, including any Disposition of any Collateral, whether by foreclosure
or otherwise;


 


(vi) will not, except for Second Lien Permitted
Actions, object to the manner in which the First Lien Collateral Agent or any
other First Lien Secured Party may seek to enforce or collect the First Lien
Obligations or the First Priority Liens, regardless of whether any action or
failure to act by or on behalf of the First Lien Collateral Agent or any other
First Lien Secured Party is, or could be, adverse to the interests of the
Second Lien Secured Parties, and will not assert, and hereby waive, to the
fullest extent permitted by law, any right to demand, request, plead or
otherwise assert or claim the benefit of any marshalling, appraisal, valuation
or other similar right that may be available under applicable law with respect
to the Collateral or any similar rights a junior secured creditor may have
under applicable law; and


 


(vii) will not attempt, directly or indirectly,
whether by judicial proceeding or otherwise, to challenge or question the
validity or enforceability of any First Lien Obligation or any First Lien
Security Document, including


 


12

















 


this Agreement, or
the validity or enforceability of the priorities, rights or obligations
established by this Agreement.


 


SECTION 3.03.
Rights as Unsecured Creditors. The Second Lien Collateral Agent and the
other Second Lien Secured Parties may, in accordance with the terms of the
Second Lien Loan Documents and applicable law, enforce rights and exercise
remedies against the Borrower and any Guarantor as unsecured creditors; provided that no such action is otherwise
inconsistent with the terms of this Agreement. Nothing in this Agreement shall
prohibit the receipt by the Second Lien Collateral Agent or any other Second
Lien Secured Party of the required payments of principal, premium, interest,
fees and other amounts due under the Second Lien Loan Documents so long as such
receipt is not the direct or indirect result of the enforcement or exercise by
the Second Lien Collateral Agent or any other Second Lien Secured Party of
rights or remedies as a secured creditor (including any right of setoff) or
enforcement in contravention of this Agreement of any Second Priority Lien (including
any judgment lien resulting from the exercise of remedies available to an
unsecured creditor, to the extent such judgment lien applies to Collateral).


 


SECTION 3.04.
Automatic Release of Second Priority Liens.   (a) If,
in connection with (i) any Disposition of any Collateral permitted under
the terms of the First Lien Loan Documents or (ii) the enforcement or exercise
of any rights or remedies with respect to the Collateral, including any
Disposition of Collateral, the First
Lien Collateral Agent, for itself and on behalf of the other First Lien Secured
Parties, (x) releases any of the First Priority Liens, or (y) releases
any Guarantor from its obligations under its guarantee of the First Lien
Obligations (in each case, a “Release”),  other
than any such Release granted following the Discharge of First Lien
Obligations, then, subject to Section 3.04(b), the Second Priority Liens
on such Collateral, and the obligations of such Guarantor under its guarantee
of the Second Lien Obligations, shall be automatically, unconditionally and
simultaneously released, and the Second Lien Collateral Agent shall, for itself
and on behalf of the other Second Lien Secured Parties, promptly execute and
deliver to the First Lien Collateral Agent, the relevant Grantor or such
Guarantor such termination statements, releases and other documents as the
First Lien Collateral Agent or the relevant Grantor or Guarantor may reasonably
request to effectively confirm such Release; provided
that, in the case of a Disposition of Collateral (other than any
such Disposition in connection with the enforcement or exercise of any rights
or remedies with respect to the Collateral), the Second Priority Liens shall
not be so released if such Disposition is not permitted under the terms of the
Second Lien Credit Agreement.


 


(b) In the event that the aggregate principal
amount of the loans, letters of credit and unused revolving credit commitments
outstanding under the First Lien Loan Documents, at any time, is less than 15%
of the sum of such amount and the aggregate principal amount of the loans
outstanding under the Second Lien Loan Documents, then any Release (other than
a Release in connection with a Disposition of Collateral in connection with the
enforcement or exercise of any rights or remedies with respect to the
Collateral permitted hereunder) shall require


 


13

















 


the consent of the
holders of First Lien Obligations and Second Lien Obligations representing in
the aggregate more than 50% of the sum of (i) the aggregate principal
amount of loans, letters of credit and unused revolving credit commitments outstanding
under the First Lien Loan Documents and (ii) the aggregate principal amount
of the loans outstanding under the Second Lien Loan Documents.


 


(c) Until the Discharge of First Lien Obligations
occurs, the Second Lien Collateral Agent, for itself and on behalf of each
other Second Lien Secured Party, hereby appoints the First Lien Collateral
Agent, and any officer or agent of the First Lien Collateral Agent, with full
power of substitution, as the attorney-in-fact of each Second Lien Secured
Party for the purpose of carrying out the provisions of this Section 3.04
and taking any action and executing any instrument that the First Lien
Collateral Agent may deem necessary or advisable to accomplish the purposes of
this Section 3.04 (including any endorsements or other instruments of
transfer or release), which appointment is irrevocable and coupled with an interest.


 


SECTION 3.05.
Automatic Release of First
Priority Liens.      If, in connection with the
enforcement or exercise of any rights or remedies with respect to the Collateral
after the expiration of the Standstill Period that is permitted in accordance
with clause (A) of the second proviso to Section 3.02 (a)(i),
including any Disposition of Collateral, the Second Lien Collateral Agent, for
itself and on behalf of the other Second Lien Secured Parties, (x) releases
any of the Second Priority Liens, or (y) releases any Guarantor from its
obligations under its guarantee of the Second Lien Obligations (in each case, a
“Second Lien Release”),  then
the First Priority Liens on such Collateral, and the obligations of such
Guarantor under its guarantee of the First Lien Obligations, shall be
automatically, unconditionally and simultaneously released, and the First Lien Collateral
Agent shall, for itself and on behalf of the other First Lien Secured Parties, promptly
execute and deliver to the Second Lien Collateral Agent, the relevant Grantor
or such Guarantor such termination statements, releases and other documents as
the Second Lien Collateral Agent or the relevant Grantor or Guarantor may
reasonably request to effectively confirm such release; provided that so long as the Discharge of
First Lien Obligations has not occurred, the proceeds of, or payments with
respect to, any Second Lien Release that are received by the Second Lien
Collateral Agent or any other Second Lien Secured Party, shall be segregated
and held in trust and forthwith transferred or paid over to the First Lien
Collateral Agent for the benefit of the First Lien Secured Parties in accordance
with Section 4.02.


 


SECTION 3.06.  Insurance and Condemnation Awards.  So long as the Discharge of First Lien
Obligations has not occurred, the First Lien Collateral Agent and the other
First Lien Secured Parties shall have the exclusive right, subject to the
rights of the Grantors under the First Lien Loan Documents, to settle and
adjust claims in respect of Collateral under policies of insurance covering
Collateral and to approve any award granted in any condemnation or similar
proceeding, or any deed in lieu of condemnation, in respect of the Collateral.
All proceeds of any such policy and any such award, or any payments with
respect to a deed in lieu of condemnation, shall (a) first, prior to the


 


14

















 


Discharge of First Lien
Obligations and subject to the rights of the Grantors under the First Lien Loan
Documents, be paid to the First Lien Collateral Agent for the benefit of First
Lien Secured Parties pursuant to the terms of the First Lien Loan Documents, (b) second,
after the Discharge of First Lien Obligations and subject to the rights of the Grantors
under the Second Lien Loan Documents, be paid to the Second Lien Collateral Agent
for the benefit of the Second Lien Secured Parties pursuant to the terms of the
Second Lien Loan Documents, and (c) third, if no Second Lien Obligations
are outstanding, be paid to the owner of the subject property, such other
person as may be entitled thereto or as a court of competent jurisdiction may
otherwise direct. Until the Discharge of First Lien Obligations has occurred,
if the Second Lien Collateral Agent or any other Second Lien Secured Party
shall, at any time, receive any proceeds of any such insurance policy or any
such award or payment, it shall transfer and pay over such proceeds to the
First Lien Collateral Agent in accordance with Section 4.02.


 


ARTICLE IV


 


Payments


 


SECTION 4.01.  Application of Proceeds. So long as the Discharge of First Lien
Obligations has not occurred, any Collateral or proceeds thereof received by the
First Lien Collateral Agent in connection with any Disposition of, or
collection on, such Collateral upon the enforcement or exercise of any right or
remedy (including any right of setoff) shall be applied by the First Lien
Collateral Agent to the First Lien Obligations. Upon the Discharge of First
Lien Obligations, the First Lien Collateral Agent shall deliver to the Second
Lien Collateral Agent any remaining Collateral and any proceeds thereof then
held by it in the same form as received, together with any necessary endorsements,
or as a court of competent jurisdiction may otherwise direct, to be applied by
the Second Lien Collateral Agent to the Second Lien Obligations.


 


SECTION 4.02.
Payment Over. So long as the Discharge of First Lien Obligations
has not occurred, any Collateral, or any proceeds thereof or payment with respect
thereto (together with assets or proceeds subject to Liens referred to in the
final sentence of Section 2.03), received by the Second Lien Collateral
Agent or any other Second Lien Secured Party in connection with any Disposition
of, or collection on, such Collateral upon the enforcement or the exercise of
any right or remedy (including any right of setoff) with respect to the
Collateral, or in connection with any insurance policy claim or any
condemnation award (or deed in lieu of condemnation), shall be segregated and
held in trust and forthwith transferred or paid over to the First Lien
Collateral Agent for the benefit of the First Lien Secured Parties in the same
form as received, together with any necessary endorsements, or as a court of
competent jurisdiction may otherwise direct. Until the Discharge of First Lien
Obligations occurs, the Second Lien Collateral Agent, for itself and on behalf
of each other Second Lien Secured Party, hereby appoints the  First Lien Collateral Agent, and any
officer or agent of the First Lien Collateral Agent, with full power of
substitution, the attorney-in-fact of each Second Lien Secured Party for the
purpose of carrying out the provisions of this Section 4.02 and taking any
action and executing any instrument that the First Lien Collateral Agent may
deem


 


15














 


necessary or advisable to
accomplish the purposes of this Section 4.02, which appointment is
irrevocable and coupled with an interest.


 


SECTION 4.03.
Certain Agreements with Respect
to Unenforceable Liens.  Notwithstanding
anything to the contrary contained herein, if in any Insolvency or Liquidation
Proceeding a determination is made that any Lien encumbering any Collateral is
not enforceable for any reason, then the Second Lien Collateral Agent and the
Second Lien Secured Parties agree that, any distribution or recovery they may
receive with respect to, or allocable to, the value of the assets intended to
constitute such Collateral or any proceeds thereof shall (for so long as the
Discharge of First Lien Obligations has not occurred) be segregated and held in
trust and forthwith paid over to the First Lien Collateral Agent for the
benefit of the First Lien Secured Parties in the same form as received without
recourse, representation or warranty (other than a representation of the Second
Lien Collateral Agent that it has not otherwise sold, assigned, transferred or
pledged any right, title or interest in and to such distribution or recovery)
but with any necessary endorsements or as a court of competent jurisdiction may
otherwise direct until such time as the Discharge of First Lien Obligations has
occurred. Until the Discharge of First Lien Obligations occurs, the Second Lien
Collateral Agent, for itself and on behalf of each other Second Lien Secured
Party, hereby appoints the First Lien Collateral Agent, and any officer or
agent of the First Lien Collateral Agent, with full power of substitution, the
attorney-in-fact of each Second Lien Secured Party for the limited purpose of
carrying out the provisions of this Section 4.03 and taking any action and
executing any instrument that the First Lien Collateral Agent may deem
necessary or advisable to accomplish the purposes of this Section 4.03,
which appointment is irrevocable and coupled with an interest.


 


ARTICLE V


 


Bailment for Perfection of
Certain Security Interests


 


(a)      The
First Lien Collateral Agent agrees that if it shall at any time hold a First
Priority Lien on any Collateral that can be perfected by the possession or
control of such Collateral or of any account in which such Collateral is held, and
if such Collateral or any such account is in fact in the possession or under
the control of the First Lien Collateral Agent, or of agents or bailees of the
First Lien Collateral Agent (such Collateral being referred to herein as the “Pledged or Controlled Collateral”), the First Lien Collateral Agent shall,
solely for the purpose of perfecting the Second Priority Liens granted under
the Second Lien Loan Documents and subject to the terms and conditions of this Article V,
also hold such Pledged or Controlled Collateral as gratuitous bailee for the
Second Lien Collateral Agent.


 


(b)      So long
as the Discharge of First Lien Obligations has not occurred, the First Lien
Collateral Agent shall be entitled to deal with the Pledged or Controlled
Collateral in accordance with the terms of this Agreement and the other


 


16

















 


First Lien Loan Documents
as if the Second Priority Liens did not exist. The obligations and
responsibilities of the First Lien Collateral Agent to the Second Lien Collateral
Agent and the other Second Lien Secured Parties under this Article V shall
be limited solely to holding or controlling the Pledged or Controlled
Collateral as gratuitous bailee in accordance with this Article V. Without
limiting the foregoing, the First Lien Collateral Agent shall have no
obligation or responsibility to ensure that any Pledged or Controlled
Collateral is genuine or owned by any of the Grantors. The First Lien
Collateral Agent acting pursuant to this Article V shall not, by reason of
this Agreement, any other Security Document or any other document, have a
fiduciary relationship in respect of any other First Lien Secured Party, the
Second Lien Collateral Agent or any other Second Lien Secured Party.


 


(c) Upon
the Discharge of First Lien Obligations, the First Lien Collateral Agent shall
transfer the possession and control of the Pledged or Controlled Collateral,
together with any necessary endorsements but without recourse or warranty, (i) if
the Second Lien Obligations are outstanding at such time, to the Second Lien
Collateral Agent, and (ii) if no Second Lien Obligations are outstanding
at such time, to the applicable Grantor, in each case so as to allow such person
to obtain possession and control of such Pledged or Controlled Collateral. In connection
with any transfer under clause (i) of the immediately preceding sentence, the
First Lien Collateral Agent agrees to take all actions in its power as shall be
reasonably requested by the Second Lien Collateral Agent to permit the Second
Lien Collateral Agent to obtain, for the benefit of the Second Lien Secured
Parties, a first priority security interest in the Pledged or Controlled
Collateral.


 


ARTICLE VI


 


Insolvency of Liquidation Proceedings


 


SECTION 6.01. Finance and Sale Matters. (a) Until the Discharge of First
Lien Obligations has occurred, the Second Lien Collateral Agent, for itself and
on behalf of the other Second Lien Secured Parties, agrees that, in the event
of any Insolvency or Liquidation Proceeding, the Second Lien Secured Parties:


 


(i) will
not oppose or object to the use of any Collateral constituting cash collateral
under Section 363 of the Bankruptcy Code, or any comparable provision of
any other Bankruptcy Law, unless the First Lien Secured Parties, or a
representative authorized by the First Lien Secured Parties, shall oppose or
object to such use of cash collateral;


 


(ii) will
not oppose or object to any post-petition financing, whether provided by the
First Lien Secured Parties or any other person, under Section 364 of the
Bankruptcy Code, or any comparable provision of any other Bankruptcy Law (a “DIP
Financing”),  or the
Liens securing any DIP Financing (“DIP Financing Liens”),  unless
the First Lien Secured Parties, or


 


17

















 


a representative
authorized by the First Lien Secured Parties, shall then oppose or object to
such DIP Financing or such DIP Financing Liens, and, to the extent that such
DIP Financing Liens are senior to, or rank pari
passu with, the First Priority Liens, the Second Lien Collateral
Agent will, for itself and on behalf of the other Second Lien Secured Parties,
subordinate the Second Priority Liens to the First Priority Liens and the DIP
Financing Liens on the terms of this Agreement; provided that the foregoing shall not prevent the Second
Lien Secured Parties from proposing any other DIP Financing to any Grantors or
to a court of competent jurisdiction;


 


(iii) except
to the extent permitted by paragraph (b) of this Section 6.01, in connection
with the use of cash collateral as described in clause (i) above or a DIP
Financing, will not request adequate protection or any other relief in
connection with such use of cash collateral, DIP Financing or DIP Financing
Liens; and


 


(iv) will not
oppose or object to any Disposition of any Collateral free and clear of the
Second Priority Liens or other claims under Section 363 of the Bankruptcy
Code, or any comparable provision of any other Bankruptcy Law, if the First
Lien Secured Parties, or a representative authorized by the First Lien Secured
Parties, shall consent to such Disposition.


 


(b) The Second Lien Collateral Agent,
for itself and on behalf of the other Second Lien Secured Parties, agrees that
no Second Lien Secured Party shall contest, or support any other person in
contesting, (i) any request by the First Lien Collateral Agent or any
other First Lien Secured Party for adequate protection or (ii) any
objection, based on a claim of a lack of adequate protection, by the First Lien
Collateral Agent or any other First Lien Secured Party to any motion, relief, action
or proceeding. Notwithstanding the immediately preceding sentence, if, in connection
with any DIP Financing or use of cash collateral, (A) any First Lien Secured
Party is granted adequate protection in the form of a Lien on additional collateral,
the Second Lien Collateral Agent may, for itself and on behalf of the other
Second Lien Secured Parties, seek or request adequate protection in the form of
a Lien on such additional collateral, which Lien will be subordinated to the
First Priority Liens and DIP Financing Liens on the same basis as the other
Second Priority Liens are subordinated to the First Priority Liens under this
Agreement or (B) any Second Lien Secured Party is granted adequate
protection in the form of a Lien on additional collateral, the First Lien
Collateral Agent shall, for itself and on behalf of the other First Lien
Secured Parties, be granted adequate protection in the form of a Lien on such
additional collateral that is senior to such Second Priority Lien as security
for the First Lien Obligations.


 


(c) Notwithstanding
the foregoing, the applicable provisions of Section 6.01(a) and (b) shall
only be binding on the Second Lien Secured Parties with respect to any DIP
Financing to the extent (i) the amount of such DIP Financing plus (ii) the
aggregate outstanding principal amount of all loans


 


18

















 


outstanding under the
First Lien Loan Documents as of the date of such DIP Financing does not exceed
the DIP Cap Amount.


 


SECTION 6.02. Relief from the Automatic Stay. The Second Lien Collateral Agent, for
itself and on behalf of the other Second Lien Secured Parties, agrees that, so
long as the Discharge of First Lien Obligations has not occurred, no Second
Lien Secured Party shall, without the prior written consent of the First Lien
Collateral Agent, seek or request relief from or modification of the automatic
stay or any other stay in any Insolvency or Liquidation Proceeding in respect
of any part of the Collateral, any proceeds thereof or any Second Priority
Lien.


 


SECTION 6.03. Reorganization Securities. If, in any Insolvency or Liquidation
Proceeding, debt obligations of the reorganized debtor secured by Liens upon any
property of the reorganized debtor are distributed, pursuant to a plan of reorganization
or similar dispositive restructuring plan, on account of both the First Lien Obligations
and the Second Lien Obligations, then, to the extent the debt obligations distributed
on account of the First Lien Obligations and on account of the Second Lien Obligations
are secured by Liens upon the same assets or property, the provisions of this Agreement
will survive the distribution of such debt obligations pursuant to such plan and
will apply with like effect to the Liens securing such debt obligations.


 


SECTION 6.04. Post-Petition Interest. (a) The Second Lien Collateral Agent,
for itself and on behalf of the other Second Lien Secured Parties, agrees that
no Second Lien Secured Party shall oppose or seek to challenge any claim by the
First Lien Collateral Agent or any other First Lien Secured Party for
allowance in any Insolvency or Liquidation Proceeding of First Lien Obligations
consisting of post-petition interest, fees or expenses to the extent of the
value of the First Priority Liens (it being understood and agreed that such
value shall be determined without regard to the existence of the Second Priority
Liens on the Collateral).


 


(b) The
First Lien Collateral Agent, for itself and on behalf of the other First Lien
Secured Parties, agrees that no First Lien Secured Party shall oppose or seek
to challenge any claim by the Second Lien Collateral Agent or any other Second
Lien Secured Party for allowance in any Insolvency or Liquidation Proceeding of
Second Lien Obligations consisting of 

post-petition interest, fees or expenses to the extent of the value of the
Second Priority Liens (it being understood and agreed that such value shall be
determined taking into account the First Priority Liens on the Collateral).


 


SECTION 6.05. Certain Waivers by the Second
Lien Secured Parties. The
Second Lien Collateral Agent, for itself and on behalf of the other Second Lien
Secured Parties, waives any claim any Second Lien Secured Party may hereafter
have against any First Lien Secured Party arising out of (a) the election
by any First Lien Secured Party of the application of Section 1111(b)(2) of
the Bankruptcy Code, or any comparable provision of any other Bankruptcy Law,
or (b) any use of cash collateral or


 


19

















 


financing arrangement, or
any grant of a security interest in the Collateral, in any Insolvency or
Liquidation Proceeding.


 


SECTION 6.06.  Certain
Voting Matters.    Each
of the First Lien Collateral Agent, on behalf of the First Lien Secured Parties
and the Second Lien Collateral Agent on behalf of the Second Lien Secured
Parties, agrees that, without the written consent of the other, it will not
seek to vote with the other as a single class in connection with any plan of
reorganization in any Insolvency or Liquidation Proceeding. Except as provided
in this Section 6.06, nothing in this Agreement is intended, or shall be construed,
to limit the ability of the Second Lien Collateral Agent or the Second Lien Secured
Parties to vote on any plan of reorganization.


 


ARTICLE VII


 


Other Agreements


 


SECTION 7.01.  Matters
Relating to Loan Documents.  (a) The
First Lien Loan Documents may be amended, restated, supplemented or otherwise
modified in accordance with their terms, and the Indebtedness under the First
Lien Credit Agreement may be Refinanced, in each case, without the consent of
any Second Lien Secured Party; provided,
however, that, without the consent of the Second Lien Required
Lenders, no such amendment, restatement, supplement, modification or
Refinancing (or successive amendments, restatements, supplements, modifications
or Refinancings) shall (i) contravene any provision of this Agreement, (ii) increase
by more than $15,000,000 the sum of (A) (1) the aggregate principal
amount of all loans outstanding under the First Lien Loan Documents as of the
date of this Agreement minus (2) the aggregate amount of any
permanent repayments of Loans under the First Lien Loan Documents (excluding any
repayments of revolving facilities without corresponding reductions of Commitments
and any repayments of Indebtedness in connection with a substantially
contemporaneous refinancing thereof) plus (B) the amount of
unused revolving credit commitments under the First Lien Loan Documents as of
the date of this Agreement, plus (C) the aggregate principal amount
of Indebtedness that may be incurred pursuant to one or more incremental term
loan or incremental revolving credit facilities pursuant to the First Lien Loan
Documents as in effect as of the date of this Agreement (the maximum
amount of Indebtedness permitted to be incurred pursuant to this Section 7.01(a)(ii) being
referred to herein as the “Cap Amount”),  (iii) increase the “Applicable
Percentage” or similar component of the interest rate under the First Lien Loan
Documents by more than 300 basis points (excluding increases resulting from the
accrual of interest at the default rate) or (iv) extend the scheduled
maturity date of the Indebtedness under the First Lien Credit Agreement or any
Refinancing thereof beyond the scheduled maturity of the Indebtedness under the
Second Lien Credit Agreement and provided
further that the holders of the Indebtedness resulting from any such
Refinancing, or a duly authorized agent on their behalf, agree in writing to be
bound by the terms of this Agreement.


 


(b) Without
the prior written consent of the First Lien Required Lenders, no Second Lien
Loan Document may be amended, restated, supplemented


 


20

















 


or otherwise modified, or
entered into, to the extent such amendment, restatement, supplement or
modification, or the terms of such new Second Lien Loan Document, would (i) contravene
the provisions of this Agreement, (ii) increase the “Applicable Percentage”
or similar component of the interest rate under the Second Lien Loan Documents
by more than 300 basis points (excluding increases resulting from the accrual
of interest at the default rate) (iii) change to earlier dates any
scheduled dates for payment of principal or of interest on Indebtedness under
the Second Lien Loan Documents, (iv) change any default or event of
default provisions set forth in the Second Lien Loan Documents in a manner
adverse to the First Lien Secured Parties, (v) change the redemption,
prepayment or defeasance provisions set forth in the Second Lien Loan Documents
in a manner adverse to the First Lien Secured Parties, (vi) add to the
Second Lien Collateral other than as specifically provided by this Agreement or
(vii) otherwise materially increase the obligations of the Borrower or the
other loan parties thereunder or confer additional rights on the Second Lien Secured
Parties in a manner adverse to the First Lien Secured Parties.  As an intercreditor agreement only and without
prejudice to any rights of the First Lien Lenders under the First Lien Credit
Agreement (including any covenants therein that may restrict such
Refinancings), Indebtedness under the Second Lien Loan Documents may be
Refinanced if (A) the terms and conditions of such Refinancing Indebtedness
are no less favorable in the aggregate to the Borrower and the other loan
parties thereunder and to the First Lien Secured Parties than the terms and conditions
of the Indebtedness then outstanding under the Second Lien Credit Agreement, (B) the
final maturity and the average life to maturity of such Refinancing
Indebtedness is at least equal to that of the Indebtedness then outstanding
under the Second Lien Credit Agreement and (C) if such Refinancing Indebtedness
is secured, the holders of such Refinancing Indebtedness, or a duly authorized
agent on their behalf, agree in writing to be bound by the terms of this Agreement.


 


(c) Each of the Borrower
and the Second Lien Collateral Agent agrees that the Second Lien Credit
Agreement and each Second Lien Security Document shall contain the applicable
provisions set forth on Annex I hereto, or similar provisions approved by the
First Lien Collateral Agent, which approval shall not be unreasonably withheld
or delayed. Each of the Borrower and the Second Lien Collateral Agent further
agrees that each Second Lien Mortgage covering any Collateral shall contain
such other language as the First Lien Collateral Agent may reasonably request
to reflect the subordination of such Second Lien Mortgage to the First Lien
Mortgage covering such Collateral pursuant to this Agreement.


 


(d) In the event that the
First Lien Collateral Agent or the other First Lien Secured Parties and the
relevant Grantor enter into any amendment, modification, waiver or consent in
respect of any of the First Lien Security Documents (other than this
Agreement), then such amendment, modification, waiver or consent shall apply
automatically to any comparable provisions of the applicable Comparable Second
Lien Security Document, in each case, without the consent of any Second Lien
Secured Party and without any action by the 
Second Lien


 


21

















 


Collateral Agent, the
Borrower or any other Grantor; provided, that
(i) no such amendment, modification, waiver or consent shall (A) remove
assets subject to the Second Priority Liens or release any such Liens, except
to the extent that such release is permitted or required by Section 3.04
and provided that there is a concurrent release of the corresponding First
Priority Liens, (B) amend, modify or otherwise affect the rights or duties
of the Second Lien Collateral Agent without its prior written consent or (C) permit
Liens on the Collateral (other than DIP Financing Liens) which are not
permitted under the terms of the Second Lien Loan Documents and (ii) notice
of such amendment, modification waiver or consent shall have been given to the
Second Lien Collateral Agent no later than the tenth Business Day following the
effective date of such amendment, modification, waiver or consent.


 


SECTION 7.02. Effect of Refinancing of Indebtedness under First Lien Loan
Documents.  If,
substantially contemporaneously with the Discharge of First Lien Obligations,
the Borrower Refinances Indebtedness outstanding under the First Lien Loan
Documents and provided that (a) such Refinancing is permitted hereby and (b) the
Borrower gives to the Second Lien Collateral Agent written notice (the “Refinancing Notice”)  electing the application of the
provisions of this Section 7.02 to such Refinancing Indebtedness, then (i) such
Discharge of First Lien Obligations shall automatically be deemed not to have
occurred for all purposes of this Agreement, (ii) such Refinancing
Indebtedness and all other obligations under the loan documents evidencing such
Indebtedness (the “New First
Lien Obligations”)  shall automatically be treated as
First Lien Obligations for all purposes of this Agreement, including for purposes
of the Lien priorities and rights in respect of Collateral set forth herein, (iii) the
credit agreement and the other loan documents evidencing such Refinancing Indebtedness
(the “New First Lien Loan
Documents”)  shall automatically be treated as the
First Lien Credit Agreement and the First Lien Loan Documents and, in the case
of New First Lien Loan Documents that are security documents, as the First Lien
Security Documents for all purposes of this Agreement, (iv) the collateral
agent under the New First Lien Loan Documents (the “New First Lien Collateral Agent”)  shall be
deemed to be the First Lien Collateral Agent for all purposes of this Agreement
and (v) the lenders under the New First Lien Loan Documents shall be
deemed to be the First Lien Lenders for all purposes of this Agreement. Upon
receipt of a Refinancing Notice, which notice shall include the identity of the
New First Lien Collateral Agent, the Second Lien Collateral Agent shall
promptly enter into such documents and agreements (including amendments or
supplements to this Agreement) as the Borrower or such New First Lien Collateral
Agent may reasonably request in order to provide to the New First Lien Collateral
Agent the rights and powers contemplated hereby, in each case consistent in all
material respects with the terms of this Agreement. The Borrower shall cause
the agreement, document or instrument pursuant to which the New First Lien
Collateral Agent is appointed to provide that the New First Lien Collateral
Agent agrees to be bound by the terms of this Agreement. In furtherance of Section 2.03,
if the New First Lien Obligations are secured by assets of the Grantors that do
not also secure the Second Lien Obligations, the applicable Grantors shall
promptly grant a Second Priority Lien on such assets to secure the Second Lien
Obligations.


 


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SECTION 7.03. No Waiver by First Lien Secured
Parties. Other
than with respect to the Second Lien Permitted Actions, nothing contained
herein shall prohibit or in any way limit the First Lien Collateral Agent or
any other First Lien Secured Party from opposing, challenging or objecting to,
in any Insolvency or Liquidation Proceeding or otherwise, any action taken, or
any claim made, by the Second Lien Collateral Agent or any other Second Lien
Secured Party, including any request by the Second Lien Collateral Agent or any
other Second Lien Secured Party for adequate protection or any exercise by the
Second Lien Collateral Agent or any other Second Lien Secured Party of any of
its rights and remedies under the Second Lien Loan Documents or otherwise.


 


SECTION 7.04. Reinstatement. If, in any Insolvency or Liquidation Proceeding
or otherwise, all or part of any payment with respect to the First Lien Obligations
previously made shall be rescinded for any reason whatsoever, then the First Lien
Obligations shall be reinstated to the extent of the amount so rescinded and,
if theretofore terminated, this Agreement shall be reinstated in full force and
effect and such prior termination shall not diminish, release, discharge,
impair or otherwise affect the Lien priorities and the relative rights and
obligations of the First Lien Secured Parties and the Second Lien Secured
Parties provided for herein.


 


SECTION 7.05. Further Assurances. Each of the First Lien Collateral Agent,
for itself and on behalf of the other First Lien Secured Parties, and the
Second Lien Collateral Agent, for itself and on behalf of the other Second Lien
Secured Parties, and each Grantor party hereto, for itself and on behalf of its
subsidiaries, agrees that it will execute, or will cause to be executed, any
and all further documents, agreements and instruments, and take all such
further actions, as may be required under any applicable law, or which the
First Lien Collateral Agent or the Second Lien Collateral Agent may reasonably
request, to effectuate the terms of this Agreement, including the relative Lien
priorities provided for herein.


 


ARTICLE VIII


 


Representations and Warranties


 


SECTION 8.01. Representations and Warranties
of Each Party. Each
party hereto represents and warrants to the other parties hereto as follows:


 


(a) Such
party is duly organized, validly existing and, to the extent such concept is
applicable in such jurisdiction, in good standing under the laws of the jurisdiction
of its organization and has all requisite power and authority to execute and
deliver this Agreement and perform its obligations hereunder.


 


(b) This
Agreement has been duly executed and delivered by such party and constitutes a
legal, valid and binding obligation of such party, enforceable against such
party in accordance with its terms.


 


23

















 


(c) The
execution, delivery and performance by such party of this Agreement (i) do
not require any consent or approval of, registration or filing with or any
other action by any governmental authority, except those that, if not obtained or
made, could not reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect, and (ii) will not violate (A) any
provision of law, statute, rule or regulation in a manner that could
reasonably be expected to result in a Material Adverse Effect, or of the
certificate or articles of incorporation or other constitutive documents or
by-laws of such party or (B) any order of any governmental authority or
any provision of any indenture, agreement or other instrument binding upon such
party in a manner that could reasonably be expected to result in a Material
Adverse Effect.


 


SECTION 8.02. Representations and Warranties
of Each Collateral Agent. Each
Collateral Agent represents and warrants to the other parties hereto that it has
been authorized by the Lenders under and as defined in the First Lien Credit Agreement
or the Second Lien Credit Agreement, as applicable, to enter into this Agreement.


 


ARTICLE IX 


 


No Reliance; No Liability;  Obligations Absolute


 


SECTION 9.01. No Reliance;  Information. Each Collateral Agent, for itself and on behalf of the
applicable other Secured Parties, acknowledges that (a) it and such
Secured Parties have, independently and without reliance upon, in the case of
the First Lien Secured Parties, any Second Lien Secured Party and, in the case
of the Second Lien Secured Parties, any First Lien Secured Party, and based on
such documents and information as they have deemed appropriate, made their own
credit analysis and decision to enter into the Loan Documents to which they are
party and (b) it and such Secured Parties will, independently and without
reliance upon, in the case of the First Lien Secured Parties, any Second Lien
Secured Party and, in the case of the Second Lien Secured Parties, any First
Lien Secured Party, and based on such documents and information as they shall
from time to time deem appropriate, continue to make their own credit decision
in taking or not taking any action under this Agreement or any other Loan Document
to which they are party. The First Lien Secured Parties and the Second Lien Secured
Parties shall have no duty to disclose to any Second Lien Secured Party or to
any First Lien Secured Party, respectively, any information relating to the
Borrower, Holdings or any of the Subsidiaries, or any other circumstance
bearing upon the risk of nonpayment of any of the First Lien Obligations or the
Second Lien Obligations, as the case may be, that is known or becomes known to
any of them or any of their Affiliates. In the event any First Lien Secured
Party or any Second Lien Secured Party, in its sole discretion, undertakes at
any time or from time to time to provide any such information to, respectively,
any Second Lien Secured Party or any First Lien Secured Party, it shall be
under no obligation (i) to make, and shall not make or be deemed to have
made, any express or implied representation or warranty, including with respect
to the accuracy, completeness, truthfulness or validity of the information so
provided, (ii) to provide any


 


24

















 


additional information or
to provide any such information on any subsequent occasion or (iii) to
undertake any investigation.


 


SECTION 9.02.  No Warranties
or Liability.       (a) The
First Lien Collateral Agent, for itself and on behalf of the other First Lien
Secured Parties, acknowledges and agrees that, except for the representations and
warranties set forth in Article VIII, neither the Second Lien Collateral
Agent nor any other Second Lien Secured Party has made any express or implied
representation or warranty, including with respect to the execution, validity,
legality, completeness, collectibility or enforceability of any of the Second
Lien Loan Documents, the ownership of any Collateral or the perfection or priority
of any Liens thereon.  The Second Lien
Collateral Agent, for itself and on behalf of the other Second Lien Secured Parties,
acknowledges and agrees that, except for the representations and warranties set
forth in Article VIII, neither the First Lien Collateral Agent nor any
other First Lien Secured Party has made any express or implied representation
or warranty, including with respect to the execution, validity, legality, completeness,
collectibility or enforceability of any of the First Lien Loan Documents, the
ownership of any Collateral or the perfection or priority of any Liens thereon.


 


(b)  The Second Lien Collateral Agent and the
other Second Lien Secured Parties shall have no express or implied duty to the
First Lien Collateral Agent or any other First Lien Secured Party, and the
First Lien Collateral Agent and the other First Lien Secured Parties shall have
no express or implied duty to the Second Lien Collateral Agent or any other
Second Lien Secured Party, to act or refrain from acting in a manner which
allows, or results in, the occurrence or continuance of a default or an event
of default under any First Lien Loan Document and any Second Lien Loan Document
(other than, in each case, this Agreement), regardless of any knowledge thereof
which they may have or be charged with.


 


(c)  The Second Lien Collateral Agent, for itself
and on behalf of the other Second Lien Secured Parties, agrees no First Lien
Secured Party shall have any liability to the Second Lien Collateral Agent or
any other Second Lien Secured Party, and hereby waives any claim against any
First Lien Secured Party, arising out of any and all actions which the First
Lien Collateral Agent or the other First Lien Secured Parties may take or
permit or omit to take with respect to (i) the First Lien Loan Documents
(other than this Agreement), (ii) the collection of the First Lien Obligations
or (iii) the maintenance of, the preservation of, the foreclosure upon or the
Disposition of any Collateral.


 


SECTION 9.03. Obligations Absolute. The Lien priorities provided for herein
and the respective rights, interests, agreements and obligations hereunder of
the First Lien Collateral Agent and the other First Lien Secured Parties and
the Second Lien Collateral Agent and the other Second Lien Secured Parties
shall remain in full force and effect irrespective of:


 


(a) any
lack of validity or enforceability of any Loan Document;


 


25

















 


(b) any
change in the time, place or manner of payment of, or in any other term of
(including, subject to the limitations set forth in Section 7.01(a), the Refinancing
of), all or any portion of the First Lien Obligations, it being specifically acknowledged
that a portion of the First Lien Obligations consists or may consist of Indebtedness
that is revolving in nature, and the amount thereof that may be outstanding at
any time or from time to time may be increased or reduced and subsequently
reborrowed;


 


(c) any
change in the time, place or manner of payment of, or, subject to the
limitations set forth in Section 7.01(a), in any other term of, all or any
portion of the First Lien Obligations;


 


(d) any
amendment, waiver or other modification, whether by course of conduct or
otherwise, of any Loan Document;


 


(e) the
securing of any First Lien Obligations or Second Lien Obligations with any
additional collateral or Guarantees, or any exchange, release, voiding,
avoidance or non-perfection of any security interest in any Collateral or any other
collateral or any release of any Guarantee securing any First Lien Obligations or
Second Lien Obligations; or


 


(f) any
other circumstances that otherwise might constitute a defense available to, or
a discharge of, the Borrower or any other loan party in respect of the First
Lien Obligations or this Agreement, or any of the Second Lien Secured Parties in
respect of this Agreement.


 


ARTICLE X


 


Miscellaneous


 


SECTION 10.01. Notices. Notices and other communications
provided for herein shall be in writing and shall be delivered by hand or
nationally recognized overnight courier service, mailed by certified or
registered mail or sent by fax, as follows:


 


(a) if
to the Borrower or any other Grantor, to it at 10 Water Street, Enfield, CT
06082, Attention of Chief Financial Officer (Fax No. (860) 749-9158); with
a copy to STR Holdings LLC, c/o DLJ Merchant Banking, Attention of Dan Gerwitz
(Fax No. (860) 749-9158); and


 


(b) if
to the First Lien Collateral Agent or the Second Lien Collateral Agent, to
Credit Suisse, at Eleven Madison Avenue, New York, NY 10010, Attention of
Agency Group (Fax No. (212) 325-8304).


 


All notices and other
communications given to any party hereto in accordance with the provisions of
this Agreement shall be deemed to have been given on the date of receipt if
delivered by hand or nationally recognized overnight courier service or sent by
fax or on the date five Business Days after dispatch by certified or registered


 


26














 


mail if mailed, in each
case delivered, sent or mailed (properly addressed) to such party as provided
in this Section 10.01 or in accordance with the latest unrevoked direction
from such party given in accordance with this Section 10.01. As agreed to
among Holdings, the Borrower and any Collateral Agent from time to time,
notices and other communications may also be delivered by 

e-mail to the e-mail address of a representative of the applicable person
provided from time to time by such person so long as a copy of such notice or
other communication is also sent by one of the other methods set forth above.


 


SECTION 10.02. Conflicts. In the event of any conflict or
inconsistency between the provisions of this Agreement and the provisions of
the other Loan Documents, the provisions of this Agreement shall control.


 


SECTION 10.03. Effectiveness; Survival. This Agreement shall become effective
when executed and delivered by the parties hereto. All covenants, agreements, representations
and warranties made by any party in this Agreement shall be considered to have
been relied upon by the other parties hereto and shall survive the execution
and delivery of this Agreement. The terms of this Agreement shall survive, and
shall continue in full force and effect, in any Insolvency or Liquidation
Proceeding. The Second Lien Collateral Agent, for itself and on behalf of the
other Second Lien Secured Parties, hereby waives any and all rights the Second
Lien Secured Parties may now or hereafter have under applicable law to revoke
this Agreement or any of the provisions of this Agreement.


 


SECTION 10.04. Severability. In the event any one or more of the provisions
contained in this Agreement should be held invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby (it being understood that the invalidity of a particular provision in a
particular jurisdiction shall not in and of itself affect the validity of such
provision in any other jurisdiction). The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with valid
provisions the economic effect of which comes as close as possible to that of
the invalid, illegal or unenforceable provisions.


 


SECTION 10.05. Amendments; Waivers. (a) No failure or delay on the part
of any party hereto in exercising any power or right hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the parties hereto are cumulative
and are not exclusive of any rights or remedies that they would otherwise have.
No waiver of any provision of this Agreement or consent to any departure by any
party therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section 10.05, and then such
waiver or consent shall be effective only in the specific instance and for the
purpose for which given.


 


27

















 


(b) Neither
this Agreement nor any provision hereof may be waived, amended or modified
except pursuant to an agreement or agreements in writing entered into by the
First Lien Collateral Agent and the Second Lien Collateral Agent; provided that no such agreement shall
amend, modify or otherwise affect the rights or obligations of any Grantor
without such person’s prior written consent.


 


SECTION 10.06. Subrogation.  The Second Lien Collateral Agent, for itself
and on behalf of the other Second Lien Secured Parties, hereby waives any
rights of subrogation it or they may acquire as a result of any payment
hereunder until the Discharge of First Lien Obligations has occurred; provided, however, that, as between the Borrower
and the other Grantors, on the one hand, and the Second Lien Secured Parties, on
the other hand, any such payment that is paid over to the First Lien Collateral
Agent pursuant to this Agreement shall be deemed not to reduce any of the
Second Lien Obligations unless and until the Discharge of First Lien
Obligations shall have occurred and the First Lien Collateral Agent delivers
any such payment to the Second Lien Collateral Agent.


 


SECTION 10.07. Applicable Law; Jurisdiction;
Consent to Service of Process.
(a) THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.


 


(b) Each
party hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of any New York State court or Federal
court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and determined
only in such New York State court or, to the extent permitted by law, in such
Federal court. Each party hereto agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law.


 


(c) Each party hereto hereby irrevocably
and unconditionally waives, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement in any New York State court or in any such Federal court. Each
party hereto hereby irrevocably waives, to the fullest extent permitted by law,
the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.


 


(d) Each
party to this Agreement irrevocably consents to service of process in the
manner provided for notices in Section 10.01. Nothing in this Agreement
will affect the right of any party to this Agreement to serve process in any
other manner permitted by law.


 


28

















 


SECTION 10.08. Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT
IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT,
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.08.


 


SECTION 10.09. Parties in Interest. This provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, as well as the other First Lien Secured
Parties and Second Lien Secured Parties, all of whom are intended to be bound
by, and to be third party beneficiaries of, this Agreement. No other person
shall have or be entitled to assert rights or benefits hereunder.


 


SECTION 10.10. Specific Performance. Each Collateral Agent may demand
specific performance of this Agreement and, on behalf of itself and the
respective other Secured Parties, hereby irrevocably waives any defense based
on the adequacy of a remedy at law and any other defense that might be asserted
to bar the remedy of specific performance in any action which may be brought by
the respective Secured Parties.


 


SECTION 10.11. Headings. Article and Section headings
used herein and the Table of Contents hereto are for convenience of reference
only, are not part of this Agreement and are not to affect the construction of,
or to be taken into consideration in interpreting, this Agreement.


 


SECTION 10.12. Counterparts. This Agreement may be executed in counterparts
(and by different parties hereto on different counterparts), each of which shall
constitute an original but all of which when taken together shall constitute a
single contract, and shall become effective as provided in Section 10.03.
Delivery of an executed signature page to this Agreement by facsimile
transmission shall be as effective as delivery of a manually signed counterpart
of this Agreement.


 


SECTION 10.13. Provisions Solely to Define Relative Rights. The provisions of this Agreement are and
are intended solely for the purpose of defining the relative rights of the
First Lien Secured Parties, on the one hand, and the Second Lien Secured
Parties, on the other hand. None of the Borrower, any other Grantor, any Guarantor
or any other creditor thereof shall have any rights or obligations, except as expressly
provided in this Agreement, hereunder and none of the Borrower, any other Grantor
or any Guarantor may rely on the terms hereof. Nothing in this Agreement is intended
to or shall impair the obligations of the Borrower or any other Grantor or any Guarantor,
which are absolute and unconditional, to pay the First Lien Obligations and


 


29

















 


the Second Lien
Obligations as and when the same shall become due and payable in accordance
with their terms.


 


[Remainder of this
page intentionally left blank]


 


30

















 


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


 


 


	
   

  	
  STR ACQUISITION, INC. 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/
  Jason Metakis

  
	
   

  	
   

  	
   

  	
  Name:
  Jason Metakis

  
	
   

  	
   

  	
   

  	
  Title: Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  STR HOLDINGS LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/
  Jason Metakis

  
	
   

  	
   

  	
   

  	
  Name: Jason Metakis

  
	
   

  	
   

  	
   

  	
  Title: Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SPECIALIZED TECHNOLOGY
  RESOURCES,

  INC.,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name: Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Title: Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  CAL SAFETY COMPLIANCE
  CORPORATION,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name: Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Title: Assistant
  Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SPECIALIZED TECHNOLOGY
  RESOURCES (INTERNATIONAL), INC.,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name: Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Title: Secretary

  
	
   

  	
   

  	
   

  	
   

  



 


[Intercreditor
Agreement]


 

















 


	
   

  	
  SHUSTER LABORATORIES,
  INC., 

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name: Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Title: Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SUPPLY CHAIN CONSULTING
  SERVICES

  CORPORATION,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  	
  Name: 

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SPECIALIZED TECHNOLOGY
  RESOURCES

  (FLORIDA), INC.,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name: Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Title: Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  STR MATERIALS SCIENCE,
  INC.,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name: Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Title:
  Secretary

  
					



 


[Intercreditor
Agreement]


 

















 


	
   

  	
  SUPPLY CHAIN CONSULTING

  SERVICES CORPORATION

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Thomas D. Vitro 

  
	
   

  	
   

  	
   

  	
  Name: Thomas D. Vitro 

  
	
   

  	
   

  	
   

  	
  Title: Assistant
  Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  



[Intercreditor
Agreement]


 

















 


	
   

  	
  CREDIT SUISSE, CAYMAN
  ISLANDS BRANCH,

  
	
   

  	
  as First Lien
  Collateral Agent,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Rianka Mohan

  
	
   

  	
   

  	
   

  	
  Name: RIANKA MOHAN

  
	
   

  	
   

  	
   

  	
  Title: VICE PRESIDENT

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ James Neira

  
	
   

  	
   

  	
   

  	
  Name: JAMES NEIRA

  
	
   

  	
   

  	
   

  	
  Title: ASSOCIATE

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  CREDIT SUISSE, CAYMAN
  ISLANDS BRANCH,

  
	
   

  	
  as Second Lien
  Collateral Agent,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Rianka Mohan

  
	
   

  	
   

  	
   

  	
  Name: RIANKA MOHAN

  
	
   

  	
   

  	
   

  	
  Title: VICE PRESIDENT

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ James Neira

  
	
   

  	
   

  	
   

  	
  Name: JAMES NEIRA

  
	
   

  	
   

  	
   

  	
  Title: ASSOCIATE

  
						



 


[Intercreditor
Agreement]


 

















 


ANNEX I


 


Provision for the Second
Lien Credit Agreement


 


“Reference is made to the
Intercreditor Agreement dated as of June 15, 2007 (as amended, restated,
supplemented or otherwise modified from time to time, the “Intercreditor
Agreement”), among
the Borrower, Holdings, the Subsidiaries of the Borrower party thereto, Credit
Suisse, as First Lien Collateral Agent (as defined therein), and Credit Suisse,
as Second Lien Collateral Agent (as defined therein). Each Lender hereunder (a) acknowledges
that it has received a copy of the Intercreditor Agreement, (b) consents
to the subordination of Liens provided for in the Intercreditor Agreement, (c) agrees
that it will be bound by and will take no actions contrary to the provisions of
the Intercreditor Agreement and (d) authorizes and instructs the
Collateral Agent to enter into the Intercreditor Agreement as Collateral Agent
and on behalf of such Lender. The foregoing provisions are intended as an
inducement to the lenders under the First Lien Credit Agreement to permit the
incurrence of Indebtedness under the Second Lien Credit Agreement and to extend
credit to the Borrower and such lenders are intended third party beneficiaries
of such provisions.”


 


Provision for the Second
Lien Security Documents


 


“Reference is made to the
Intercreditor Agreement dated as of June 15, 2007 (as amended, restated,
supplemented or otherwise modified from time to time, the “Intercreditor
Agreement”), among
the Borrower, Holdings, the Subsidiaries of the Borrower party thereto, Credit
Suisse, as First Lien Collateral Agent (as defined therein), and Credit Suisse,
as Second Lien Collateral Agent (as defined therein). Notwithstanding anything
herein to the contrary, the lien and security interest granted to the
Collateral Agent, for the benefit of the Secured Parties, pursuant to this
Agreement and the exercise of any right or remedy by the Collateral Agent and the
other Secured Parties hereunder are subject to the provisions of the Intercreditor
Agreement. In the event of any conflict or inconsistency between the provisions
of the Intercreditor Agreement, and this Agreement, the provisions of the Intercreditor
Agreement shall control.”