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                                               Published CUSIP Number: 19933MAD5







                           THIRD AMENDED AND RESTATED


                                CREDIT AGREEMENT

                           Dated as of March 16, 2006

                                      among

                         COLUMBUS MCKINNON CORPORATION,

                                as the Borrower,

                             BANK OF AMERICA, N.A.,
                   as Administrative Agent, Swing Line Lender
                                       and
                                   L/C Issuer,

                                       and

                         The Other Lenders Party Hereto

                         BANC OF AMERICA SECURITIES LLC,

                                       as

                    Sole Lead Arranger and Sole Book Manager



<PAGE>

                                TABLE OF CONTENTS
                                -----------------

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ARTICLE I.            DEFINITIONS AND ACCOUNTING TERMS........................2

         1.01.    Defined Terms...............................................2

         1.02.    Other Interpretive Provisions..............................27

         1.03.    Accounting Terms...........................................28

         1.04.    Rounding...................................................28

         1.05.    Times of Day...............................................28

         1.06.    Letter of Credit Amounts...................................28

ARTICLE II.           THE COMMITMENTS AND CREDIT EXTENSIONS..................29

         2.01.    Committed Loans............................................29

         2.02.    Borrowings, Conversions and Continuations of
                  Committed Loans............................................29

         2.03.    Letters of Credit..........................................31

         2.04.    Swing Line Loans...........................................39

         2.05.    Prepayments................................................42

         2.06.    Termination or Reduction of Commitments....................43

         2.07.    Repayment of Loans.........................................44

         2.08.    Interest...................................................45

         2.09.    Fees.......................................................46

         2.10.    Computation of Interest and Fees...........................46

         2.11.    Evidence of Debt...........................................47

         2.12.    Payments Generally; Administrative Agent's Clawback........47

         2.13.    Sharing of Payments by Lenders.............................49

         2.14.    Increase in Commitments....................................50

         2.15.    Collateral Security........................................51

ARTICLE III.          TAXES, YIELD PROTECTION AND ILLEGALITY.................51

         3.01.    Taxes......................................................51

         3.02.    Illegality.................................................53

         3.03.    Inability to Determine Rates...............................54

         3.04.    Increased Costs; Reserves on Eurodollar Rate Loans.........54

         3.05.    Compensation for Losses....................................56

         3.06.    Mitigation Obligations; Replacement of Lenders.............56

                                        i

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         3.07.    Survival...................................................57

ARTICLE IV.           CONDITIONS PRECEDENT TO CREDIT EXTENSIONS..............57

         4.01.    Conditions of Initial Credit Extension.....................57

         4.02.    Conditions to all Credit Extensions........................59

ARTICLE V.            REPRESENTATIONS AND WARRANTIES.........................60

         5.01.    Existence, Qualification and Power.........................60

         5.02.    Authorization; No Contravention............................60

         5.03.    Governmental Authorization; Other Consents.................60

         5.04.    Binding Effect.............................................61

         5.05.    Financial Statements; No Material Adverse Effect;
                  No Internal Control Event..................................61

         5.06.    Litigation.................................................62

         5.07.    No Default.................................................62

         5.08.    Ownership of Property; Liens...............................62

         5.09.    Environmental Compliance...................................62

         5.10.    Insurance..................................................62

         5.11.    Taxes......................................................62

         5.12.    ERISA Compliance...........................................63

         5.13.    Subsidiaries; Equity Interests.............................63

         5.14.    Margin Regulations; Investment Company Act;
                  Public Utility Holding Company Act.........................63

         5.15.    Disclosure.................................................64

         5.16.    Compliance with Laws.......................................64

         5.17.    Taxpayer Identification Number.............................64

         5.18.    Intellectual Property; Licenses, Etc.......................64

         5.19.    Perfection of Security Interest............................65

         5.20.    Properties.................................................65

         5.21.    Solvency...................................................65

         5.22.    Bank Accounts..............................................65

         5.23.    Obligations as Senior Debt.................................65

         5.24.    Use of Proceeds............................................65

                                       ii

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                                TABLE OF CONTENTS
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                                   (continued)
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ARTICLE VI.           AFFIRMATIVE COVENANTS..................................66

         6.01.    Financial Statements.......................................66

         6.02.    Certificates; Other Information............................67

         6.03.    Notices....................................................68

         6.04.    Payment of Obligations.....................................69

         6.05.    Preservation of Existence, Etc.............................69

         6.06.    Maintenance of Properties..................................69

         6.07.    Maintenance of Insurance...................................70

         6.08.    Compliance with Laws, Organizational Documents
                  and Contractual Obligations................................70

         6.09.    Books and Records..........................................70

         6.10.    Inspection Rights..........................................70

         6.11.    Use of Proceeds............................................70

         6.12.    Additional Guarantors and Pledgors.........................70

         6.13.    Mortgages..................................................71

         6.14.    Post-Closing Deliveries....................................71

ARTICLE VII.          NEGATIVE COVENANTS.....................................72

         7.01.    Liens......................................................72

         7.02.    Investments................................................73

         7.03.    Indebtedness...............................................73

         7.04.    Fundamental Changes........................................75

         7.05.    Dispositions...............................................75

         7.06.    Restricted Payments........................................76

         7.07.    Change in Nature of Business...............................77

         7.08.    Transactions with Affiliates...............................77

         7.09.    Burdensome Agreements......................................77

         7.10.    Use of Proceeds............................................77

         7.11.    Financial Covenants........................................77

         7.12.    Modifications of Certain Documents; Designation
                  of Senior Debt.............................................78

         7.13.    Sale-Leaseback Transactions................................78

                                      iii

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                                TABLE OF CONTENTS
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                                   (continued)
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ARTICLE VIII.         EVENTS OF DEFAULT AND REMEDIES.........................78

         8.01.    Events of Default..........................................78

         8.02.    Remedies Upon Event of Default.............................80

         8.03.    Application of Funds.......................................81

ARTICLE IX.           ADMINISTRATIVE AGENT...................................82

         9.01.    Appointment and Authority..................................82

         9.02.    Rights as a Lender.........................................82

         9.03.    Exculpatory Provisions.....................................82

         9.04.    Reliance by Administrative Agent...........................83

         9.05.    Delegation of Duties.......................................83

         9.06.    Resignation of Administrative Agent........................84

         9.07.    Non-Reliance on Administrative Agent and Other Lenders.....85

         9.08.    No Other Duties, Etc.......................................85

         9.09.    Administrative Agent May File Proofs of Claim..............85

         9.10.    Collateral and Guaranty Matters............................86

         9.11.    Intercreditor Agreement....................................86

ARTICLE X.            MISCELLANEOUS..........................................86

         10.01.   Amendments, Etc............................................86

         10.02.   Notices; Effectiveness; Electronic Communication...........88

         10.03.   No Waiver; Cumulative Remedies.............................89

         10.04.   Expenses; Indemnity; Damage Waiver.........................90

         10.05.   Payments Set Aside.........................................92

         10.06.   Successors and Assigns.....................................92

         10.07.   Treatment of Certain Information; Confidentiality..........97

         10.08.   Right of Setoff............................................97

         10.09.   Interest Rate Limitation...................................98

         10.10.   Counterparts; Integration; Effectiveness...................98

         10.11.   Survival of Representations and Warranties.................98

         10.12.   Severability...............................................99

         10.13.   Replacement of Lenders.....................................99

                                       iv

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                                TABLE OF CONTENTS
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                                   (continued)
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         10.14.   Governing Law; Jurisdiction; Etc..........................100

         10.15.   Waiver of Jury Trial......................................100

         10.16.   No Advisory or Fiduciary Responsibility...................101

         10.17.   USA PATRIOT Act Notice....................................102

         10.18.   Time of the Essence.......................................102

                                                         v

<PAGE>


SCHEDULES

         2.01     Commitments and Applicable Percentages
         5.05     Material Indebtedness and Other Liabilities at January 1, 2006
         5.06     Litigation
         5.09     Environmental Matters
         5.13     Subsidiaries; Other Equity Investments
         5.18     Intellectual Property Matters
         5.20     Fee and Leasehold Real Property Assets
         5.22     Bank Accounts
         6.13     Material Leasehold Real Estate Assets
         7.01     Existing Liens
         7.03     Existing Indebtedness
         7.05     Permitted Exclusive Licenses of IP Rights
         7.09     Burdensome Agreements
         10.02    Administrative Agent's Office; Certain Addresses for Notices
         10.06    Processing and Recordation Fees



EXHIBITS
                  Form of

         A        Committed Loan Notice
         B        Swing Line Loan Notice
         C        Note
         D        Compliance Certificate
         E        Assignment and Assumption
         F        Guaranty
         G        Opinion Matters


<PAGE>


                           THIRD AMENDED AND RESTATED

                                CREDIT AGREEMENT

     This THIRD AMENDED AND RESTATED CREDIT AGREEMENT  ("AGREEMENT") is dated as
of March 16, 2006, among COLUMBUS MCKINNON  CORPORATION,  a New York corporation
(the "BORROWER"), each lender from time to time party hereto (collectively,  the
"LENDERS"  and  individually,  a  "LENDER"),  and  BANK  OF  AMERICA,  N.A.,  as
Administrative Agent, Swing Line Lender and L/C Issuer.

     WHEREAS,  the Borrower  has  previously  entered  into that certain  Credit
Agreement  dated  as of  March  31,  1998  (as  amended,  the  "ORIGINAL  CREDIT
AGREEMENT"),  among the Borrower,  the lenders named therein, and Fleet National
Bank, as Agent;

     WHEREAS,   the  Borrower,   Larco  Industrial   Services  Ltd,  a  business
corporation  organized  under  the laws of the  Province  of  Ontario,  Columbus
McKinnon Limited, a business corporation organized under the laws of Canada, the
Guarantors  named therein,  the lenders from time to time party  thereto,  Fleet
Capital Corporation, as Administrative Agent, Fleet National Bank, as L/C Issuer
and Fleet  Securities,  Inc.,  as Arranger  have  previously  entered  into that
certain Amended and Restated Credit and Security Agreement, dated as of November
21, 2002 (as amended,  by the First Amendment,  dated as of June 5, 2003 and the
Second  Amendment,  dated as of July 21, 2003,  the "FIRST  AMENDED AND RESTATED
CREDIT  AGREEMENT"),  which First Amended and Restated Credit Agreement  amended
and restated the Original Credit Agreement and, together with the Loan Documents
(as  defined  therein)  evidenced  the  rights,  obligations,   liens,  security
interests,  and  collateral  security  assigned  pursuant to the  Assignment (as
defined below);

     WHEREAS,  pursuant to a certain  Assignment and Acceptance,  dated November
21,  2002 (the  "ASSIGNMENT"),  among the  Borrower,  the  lenders  party to the
Original Credit Agreement, the Administrative Agent and the Lenders party to the
First Amended and Restated Credit Agreement,  (i) the lenders under the Original
Credit  Agreement  assigned to the Lenders  under the First Amended and Restated
Credit Agreement the outstanding  loans and other obligations under the Original
Credit Agreement and (ii) the Agent under the Original Credit Agreement assigned
to the  Administrative  Agent  under  the  First  Amended  and  Restated  Credit
Agreement all of its liens,  security  interests,  and collateral security under
the Original Credit Agreement;

     WHEREAS,   the  Borrower,   Larco  Industrial   Services  Ltd,  a  business
corporation  organized  under  the laws of the  Province  of  Ontario,  Columbus
McKinnon Limited, a business corporation organized under the laws of Canada, the
Guarantors  named therein,  the lenders from time to time party  thereto,  Fleet
Capital Corporation, as Administrative Agent, Fleet National Bank, as L/C Issuer
and Fleet  Securities,  Inc.,  as Arranger  have  previously  entered  into that
certain Second Amended and Restated Credit and Security  Agreement,  dated as of
November 21, 2002 and amended and restated as of January 2, 2004, (as amended by
that  certain  First  Amendment  to  the  Second  Amended  and  Restated  Credit
Agreement,  dated as of April 29, 2005, and by that certain Second  Amendment to
the Second Amended and Restated  Credit  Agreement,  dated as of August 5, 2005,
and by that certain Third  Amendment to the Second  Amended and Restated  Credit

                                      S-1
<PAGE>

Agreement,  dated as of August 22, 2005, and by that certain Fourth Amendment to
Second Amended and Restated Credit Agreement,  dated as of October 17, 2005, the
"SECOND  AMENDED AND  RESTATED  CREDIT  AGREEMENT"),  which  Second  Amended and
Restated  Credit  Agreement  amended and restated the First Amended and Restated
Credit  Agreement  and,  together with the Loan  Documents (as defined  therein)
evidenced the rights,  obligations,  liens,  security interests,  and collateral
security assigned pursuant to the Assignment;

     WHEREAS,  pursuant to a certain Assignment and Assumption Agreement,  dated
the Closing Date (as defined  below),  among the Borrower,  the lenders party to
the Second Amended and Restated Credit Agreement,  the Administrative  Agent and
Bank of  America,  N.A.,  as Lender,  the lenders  under the Second  Amended and
Restated Credit Agreement assigned to the Administrative  Agent, the outstanding
loans and other  obligations  under  the  Second  Amended  and  Restated  Credit
Agreement and, as further  described in SECTION 2.01(B) of this  Agreement,  the
Administrative  Agent  shall make a  subsequent  assignment  of the  Commitments
hereunder to the Lenders  party hereto in the amounts set forth on SCHEDULE 2.01
to this Agreement; and

     WHEREAS,  it is the  intention and desire of the parties that the loans and
other  obligations  under the Second  Amended and Restated  Credit  Agreement be
amended and restated as set forth herein such that the obligations of the Credit
Parties (as defined  therein) and the rights,  liens,  security  interests,  and
collateral security of the Administrative Agent and the Lenders thereunder shall
hereafter be  evidenced by this  Agreement,  the  Assignment  and the other Loan
Documents referred to herein.

     NOW,  THEREFORE,  the parties agree that,  effective as of the Closing Date
(as defined below),  the Second Amended and Restated  Credit  Agreement shall be
amended and restated as set forth herein.

     In consideration of the mutual covenants and agreements  herein  contained,
the parties hereto covenant and agree as follows:

                                   ARTICLE I.
                        DEFINITIONS AND ACCOUNTING TERMS

     1.01.  DEFINED TERMS. As used in this Agreement,  the following terms shall
have the meanings set forth below:

     "ADDITIONAL SUBORDINATED  INDEBTEDNESS" means Indebtedness  subordinated to
the Obligations on terms and conditions satisfactory to the Administrative Agent
in an  aggregate  amount  not in excess of  $75,000,000  during the term of this
Agreement  permitted to be incurred  pursuant to SECTION 7.03 and used by a Loan
Party within 90 days after the  incurrence of such  Indebtedness  or such longer
period  as  may be  agreed,  in  writing,  by the  Administrative  Agent  to (a)
repurchase  and/or  refinance the Senior Notes or (b) purchase  assets or equity
interests so long as such acquisitions are permitted pursuant to SECTION 7.02.

     "ADMINISTRATIVE   AGENT"   means  Bank  of  America  in  its   capacity  as
administrative  agent  under  any  of  the  Loan  Documents,  or  any  successor
administrative agent.

                                      S-2
<PAGE>

     "ADMINISTRATIVE  AGENT'S OFFICE" means the  Administrative  Agent's address
and,  as  appropriate,  account as set forth on  SCHEDULE  10.02,  or such other
address or account as the  Administrative  Agent may from time to time notify to
the Borrower and the Lenders.

     "ADMINISTRATIVE  QUESTIONNAIRE" means an Administrative  Questionnaire in a
form supplied by the Administrative Agent.

     "AFFILIATE"  means,  with  respect  to  any  Person,  another  Person  that
directly,  or  indirectly  through  one or more  intermediaries,  Controls or is
Controlled by or is under common Control with the Person specified.

     "AGGREGATE COMMITMENTS" means the Commitments of all the Lenders.

     "AGREEMENT" means this Credit Agreement.

     "APPLICABLE  PERCENTAGE"  means with respect to any Lender at any time, the
percentage (carried out to the ninth decimal place) of the Aggregate Commitments
represented by such Lender's  Commitment at such time. If the commitment of each
Lender to make  Loans and the  obligation  of the L/C  Issuer to make L/C Credit
Extensions  have been  terminated  pursuant to SECTION 8.02 or if the  Aggregate
Commitments have expired, then the Applicable Percentage of each Lender shall be
determined  based on the  Applicable  Percentage of such Lender most recently in
effect,  giving effect to any  subsequent  assignments.  The initial  Applicable
Percentage  of each  Lender is set  forth  opposite  the name of such  Lender on
SCHEDULE 2.01 or in the Assignment and Assumption  pursuant to which such Lender
becomes a party hereto, as applicable.

     "APPLICABLE RATE" means,  from time to time, the following  percentages per
annum,  based upon the  Senior  Leverage  Ratio as set forth in the most  recent
Compliance  Certificate received by the Administrative Agent pursuant to SECTION
6.02(A):

------- ---------------------------- ---------- ---------- ---------- ---------

 LEVEL      SENIOR LEVERAGE RATIO    COMMITMENT EURODOLLAR LETTER OF  BASE RATE
                                        FEE       RATE +   CREDIT FEE     +


------- ---------------------------- ---------- ---------- ---------- ---------
I       Greater  than or  equal  to    0.250%     1.750%     1.750%     0.750%
        2.50x
------- ---------------------------- ---------- ---------- ---------- ---------
II      Less   than    2.50x   but     0.200%     1.500%     1.500%     0.500%
        greater  than or  equal  to
        2.00x
------- ---------------------------- ---------- ---------- ---------- ---------
III     Less    than    2.00x   but    0.175%     1.250%     1.250%     0.250%
        greater  than or  equal  to
        1.50x
------- ---------------------------- ---------- ---------- ---------- ---------
IV      Less    than    1.50x   but    0.150%     1.000%     1.000%       0%
        greater  than or  equal  to
        1.00x
------- ---------------------------- ---------- ---------- ---------- ---------
V       Less than 1.00x                0.125%     0.875%     0.875%       0%
------- ---------------------------- ---------- ---------- ---------- ---------
                                      S-3
<PAGE>

     Any increase or decrease in the Applicable  Rate resulting from a change in
the Senior  Leverage  Ratio shall become  effective as of the first Business Day
immediately following the date a Compliance Certificate is delivered pursuant to
SECTION  6.02(A);  provided,  however,  that if a Compliance  Certificate is not
delivered when due in accordance  with such Section,  then Pricing Level I shall
apply as of the  first  Business  Day after  the date on which  such  Compliance
Certificate was required to have been  delivered.  The Applicable Rate in effect
from the Closing  Date  through  March 31, 2006 shall be  determined  based upon
Pricing Level IV.

     "APPROVED  RESTRUCTURING  CHARGES"  means  cash or  non-cash  restructuring
charges  incurred by the Borrower and/or its Subsidiaries in an aggregate amount
not to exceed  $3,750,000  during the term of this Agreement;  PROVIDED however,
amounts in excess of $2,000,000 in  restructuring  charges for any one facility,
plant or other  Property  shall not constitute  Approved  Restructuring  Charges
unless approved, in writing, by the Administrative Agent.

     "ARRANGER"  means Banc of America  Securities  LLC, in its capacity as sole
lead arranger and sole book manager.

     "ASSIGNEE  GROUP" means two or more Eligible  Assignees that are Affiliates
of one another.

     "ASSIGNMENTS OF MORTGAGE" means the several  Assignments of Mortgage,  made
in favor the Administrative  Agent, with respect to certain of the real property
assets of the Loan Parties.

     "ASSIGNMENT AND ASSUMPTION" means an assignment and assumption entered into
by a Lender and an  assignee  (with the  consent of any party  whose  consent is
required by SECTION  10.06(B),  and  accepted by the  Administrative  Agent,  in
substantially  the  form  of  EXHIBIT  E or  any  other  form  approved  by  the
Administrative Agent.

     "ATTRIBUTABLE  INDEBTEDNESS"  means,  on any date,  (a) in  respect  of any
capital lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease Obligation,  the capitalized amount of
the remaining  lease  payments  under the relevant  lease that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP if
such lease were accounted for as a capital lease.

     "AUDITED FINANCIAL STATEMENTS" means the audited consolidated balance sheet
of the Borrower and its  Subsidiaries  for the fiscal year ended March 31, 2005,
and the related consolidated  statements of income or operations,  shareholders'
equity and cash flows for such fiscal year of the Borrower and its Subsidiaries,
including the notes thereto.

                                      S-4
<PAGE>

     "AUDUBON EUROPE" means Audubon Europe S.A.R.L., a private limited liability
company ("societe a responsabilite limitee") incorporated and existing under the
laws of Luxembourg,  with its registered office at L-2146 Luxembourg,  74 rue de
Merl,  registered  with the Luxembourg  Register of commerce and companies under
number B 88,221, whose corporate capital is fixed at EUR 4,268,000.00.

     "AVAILABILITY  PERIOD" means the period from and including the Closing Date
to the earliest of (a) the Maturity  Date,  (b) the date of  termination  of the
Aggregate  Commitments pursuant to SECTION 2.06, and (c) the date of termination
of the  commitment of each Lender to make Loans and of the obligation of the L/C
Issuer to make L/C Credit Extensions pursuant to SECTION 8.02.

     "BANK  OF  AMERICA"  means  Bank  of  America,  N.A.  and  its  successors.

     "BASE  RATE"  means for any day a  fluctuating  rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in  effect  for  such day as  publicly  announced  from  time to time by Bank of
America as its "prime  rate." The "prime  rate" is a rate set by Bank of America
based upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors,  and is used as a reference point
for pricing some loans,  which may be priced at, above,  or below such announced
rate.  Any change in such rate announced by Bank of America shall take effect at
the opening of business on the day specified in the public  announcement of such
change.

     "BASE RATE COMMITTED LOAN" means a Committed Loan that is a Base Rate Loan.

     "BASE RATE LOAN" means a Loan that bears interest based on the Base Rate.

     "BORROWER" has the meaning specified in the introductory paragraph hereto.

     "BORROWER MATERIALS" has the meaning specified in SECTION 6.02.

     "BORROWER SECURITY AGREEMENT" means that certain Security Agreement,  dated
as of the date hereof,  from the Borrower to the  Administrative  Agent, for the
benefit of the Lenders.

     "BORROWING" means a Committed  Borrowing or a Swing Line Borrowing,  as the
context may require.

     "BUSINESS DAY" means any day other than a Saturday,  Sunday or other day on
which commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where the Administrative  Agent's Office is located and, if
such day  relates  to any  Eurodollar  Rate  Loan,  means  any such day on which
dealings in Dollar  deposits are  conducted  by and between  banks in the London
interbank eurodollar market.

     "CALCULATION DATE" has the meaning specified in SECTION 2.07(C)(II).

     "CAPITAL  LEASE  OBLIGATIONS"  of any Person means the  obligations of such
Person to pay rent or other  amounts  under  any lease of (or other  arrangement

                                      S-5
<PAGE>

conveying the right to use) real or personal property, or a combination thereof,
which  obligations  are required to be  classified  and accounted for as capital
leases on a balance  sheet of such  Person  under  GAAP,  and the amount of such
obligations  shall be the  capitalized  amount thereof  determined in accordance
with GAAP.

     "CASH COLLATERALIZE" has the meaning specified in SECTION 2.03(G).

     "CASUALTY  EVENT"  means,  with respect to any property of any Person,  any
loss of or damage to, or any  condemnation or other taking of, such property for
which such Person or any of its Subsidiaries  receives  insurance  proceeds,  or
proceeds of a condemnation award or other compensation.

     "CHANGE IN LAW" means the occurrence,  after the date of this Agreement, of
any of the  following:  (a) the  adoption  or taking  effect  of any law,  rule,
regulation or treaty,  (b) any change in any law, rule,  regulation or treaty or
in the administration, interpretation or application thereof by any Governmental
Authority or (c) the making or issuance of any  request,  guideline or directive
(whether or not having the force of law) by any Governmental Authority.

     "CHANGE OF CONTROL" means an event or series of events by which:

     (a) any  "person" or "group" (as such terms are used in Sections  13(d) and
14(d) of the Securities Exchange Act of 1934, but excluding any employee benefit
plan of such person or its subsidiaries,  and any person or entity acting in its
capacity as trustee, agent or other fiduciary or administrator of any such plan)
becomes  the  "beneficial  owner" (as defined in Rules 13d-3 and 13d-5 under the
Securities  Exchange Act of 1934,  except that a person or group shall be deemed
to have  "beneficial  ownership" of all securities that such person or group has
the right to acquire,  whether  such right is  exercisable  immediately  or only
after the  passage  of time  (such  right,  an  "OPTION  RIGHT")),  directly  or
indirectly,  of 25% or more of the equity securities of the Borrower entitled to
vote for members of the board of directors or equivalent  governing  body of the
Borrower on a  fully-diluted  basis (and taking into account all such securities
that  such  person  or group has the right to  acquire  pursuant  to any  option
right);

     (b) during any period of 24 consecutive  months,  a majority of the members
of the board of directors  or other  equivalent  governing  body of the Borrower
cease to be  composed  of  individuals  (i) who were  members  of that  board or
equivalent  governing body on the first day of such period,  (ii) whose election
or  nomination  to that  board or  equivalent  governing  body was  approved  by
individuals  referred  to in clause (i) above  constituting  at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose  election or  nomination  to that board or other  equivalent
governing body was approved by  individuals  referred to in clauses (i) and (ii)
above  constituting  at the  time of such  election  or  nomination  at  least a
majority of that board or equivalent  governing body (excluding,  in the case of
both clause (ii) and clause (iii), any individual whose initial  nomination for,
or assumption of office as, a member of that board or equivalent  governing body
occurs as a result  of an  actual  or  threatened  solicitation  of  proxies  or
consents for the  election or removal of one or more  directors by any person or
group other than a solicitation  for the election of one or more directors by or
on behalf of the board of directors);

                                      S-6
<PAGE>

     (c) any Person or two or more Persons acting in concert shall have acquired
by contract or otherwise,  or shall have entered into a contract or  arrangement
that, upon consummation  thereof, will result in its or their acquisition of the
power to exercise,  directly or  indirectly,  a controlling  influence  over the
management or policies of the Borrower, or control over the equity securities of
the  Borrower  entitled  to vote  for  members  of the  board  of  directors  or
equivalent  governing body of the Borrower on a fully-diluted  basis (and taking
into  account  all such  securities  that such  Person or group has the right to
acquire  pursuant to any option right)  representing 25% or more of the combined
voting power of such securities;

     (d) the Borrower  shall cease to have  beneficial  ownership (as defined in
Rule 13d-3 under the Exchange Act) of 100% of the aggregate  voting power of the
Capital Stock of each other Loan Party,  free and clear of all Liens (other than
any Liens granted hereunder and Permitted Liens); or

     (e) a "Change of Control"  shall occur under the Senior  Subordinated  Note
Indenture or the Senior Note Indenture.

     "CLOSING DATE" means the first date all the conditions precedent in SECTION
4.01 are satisfied or waived in accordance with SECTION 10.01.

     "CODE" means the Internal Revenue Code of 1986.

     "COLLATERAL"  means all of the  property,  rights and interests of the Loan
Parties  and their  Subsidiaries  that are or are  intended to be subject to the
Liens created by the Security Documents.

     "COMMITMENT" means, as to each Lender, its obligation to (a) make Committed
Loans to the Borrower  pursuant to SECTION 2.01, (b) purchase  participations in
L/C  Obligations,  and (c) purchase  participations  in Swing Line Loans,  in an
aggregate  principal amount at any one time outstanding not to exceed the amount
set forth  opposite such Lender's name on SCHEDULE 2.01 or in the Assignment and
Assumption  pursuant to which such Lender becomes a party hereto, as applicable,
as such  amount  may be  adjusted  from  time to time in  accordance  with  this
Agreement.

     "COMMITTED   BORROWING"  means  a  borrowing   consisting  of  simultaneous
Committed  Loans of the same Type and,  in the case of  Eurodollar  Rate  Loans,
having the same Interest Period made by each of the Lenders  pursuant to SECTION
2.01.

     "COMMITTED LOAN" has the meaning specified in SECTION 2.01.

     "COMMITTED LOAN NOTICE" means a notice of (a) a Committed Borrowing,  (b) a
conversion of Committed  Loans from one Type to the other, or (c) a continuation
of Eurodollar  Rate Loans,  pursuant to SECTION  2.02(A),  which, if in writing,
shall be substantially in the form of EXHIBIT A.

     "COMPLIANCE  CERTIFICATE" means a certificate  substantially in the form of
EXHIBIT D.

                                      S-7
<PAGE>

     "CONSOLIDATED  EBITDA" means, for any period and without  duplication,  (a)
the  net  income  of  the  Borrower  and  its  Subsidiaries   (determined  on  a
consolidated  basis in  accordance  with GAAP) for such period,  PLUS (b) to the
extent  deducted in calculating net income (i) income taxes expensed during such
period,   (ii)  Interest  Expense  during  such  period,   (iii)   depreciation,
amortization and other Non-Cash  Charges accrued for such period,  (iv) Approved
Restructuring Charges incurred during such period, (v) the amount of any premium
paid on the repurchase of the Senior  Subordinated Notes, (vi) the amount of any
premium paid on the  repurchase  of the Senior Notes and (vii)  non-cash  losses
from any Casualty  Event,  Disposition  or  discontinued  operation  during such
period MINUS (c) to the extent such items were added in  calculating  net income
(i) extraordinary  gains during such period, (ii) gains from any Casualty Event,
Disposition,  or discontinued  operation during such period,  (iii) interest and
other  income  (excluding  interest  and other  income  related to CM  Insurance
Company, Inc.) during such period, (iv) Federal, state, local and foreign income
tax credits of the  Borrower  and its  Subsidiaries  for such period and (v) all
non-cash items increasing Consolidated Net Income for such period.

     "CONSOLIDATED  NET INCOME" means, for any period,  for the Borrower and its
Subsidiaries  on a  consolidated  basis,  the net income of the Borrower and its
Subsidiaries.

     "CONTRACTUAL  OBLIGATION"  means,  as to any Person,  any  provision of any
security  issued  by  such  Person  or of any  agreement,  instrument  or  other
undertaking  to  which  such  Person  is a party  or by  which  it or any of its
property is bound.

     "CONTROL"  means the  possession,  directly or indirectly,  of the power to
direct or cause the direction of the management or policies of a Person, whether
through  the  ability to  exercise  voting  power,  by  contract  or  otherwise.
"CONTROLLING" and "CONTROLLED" have meanings correlative thereto.

     "COPYRIGHT  MORTGAGE"  means any grant of security  interest in copyrights,
made by any  Loan  Party in favor  of the  Administrative  Agent,  or any of its
predecessors,  including, without limitation that certain Memorandum of Grant of
Security  Interest in  Copyrights,  dated as of November 21, 2002,  between Yale
Industrial Products,  Inc. and Fleet Capital Corporation (n/k/a Bank of America,
N.A.) as agent,  as amended,  restated,  replaced or assigned from time to time,
including as amended by that certain  First  Amendment to Memorandum of Grant of
Security Interest in Copyrights, dated as of the Closing Date.

     "CREDIT EXTENSION" means each of the following:  (a) a Borrowing and (b) an
L/C Credit Extension.

     "DEBTOR  RELIEF LAWS" means the Bankruptcy  Code of the United States,  and
all other liquidation,  conservatorship,  bankruptcy, assignment for the benefit
of   creditors,    moratorium,    rearrangement,    receivership,    insolvency,
reorganization,  or similar  debtor  relief  Laws of the United  States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.

     "DEFAULT" means any event or condition that constitutes an Event of Default
or that, with the giving of any notice,  the passage of time, or both,  would be
an Event of Default.

                                      S-8
<PAGE>

     "DEFAULT RATE" means (a) when used with respect to  Obligations  other than
Letter of Credit Fees, an interest rate equal to (i) the Base Rate PLUS (ii) the
Applicable Rate, if any,  applicable to Base Rate Loans PLUS (iii) 2% per annum;
PROVIDED, HOWEVER, that with respect to a Eurodollar Rate Loan, the Default Rate
shall be an interest rate equal to the interest rate  (including  any Applicable
Rate)  otherwise  applicable  to such Loan plus 2% per annum,  and (b) when used
with respect to Letter of Credit Fees, a rate equal to the Applicable  Rate PLUS
2% per annum.

     "DEFAULTING  LENDER"  means  any  Lender  that (a) has  failed  to fund any
portion  of  the  Committed   Loans,   participations   in  L/C  Obligations  or
participations  in Swing Line Loans required to be funded by it hereunder within
one Business Day of the date  required to be funded by it hereunder  unless such
failure  has  been  cured,   (b)  has  otherwise  failed  to  pay  over  to  the
Administrative Agent or any other Lender any other amount required to be paid by
it hereunder within one Business Day of the date when due, unless the subject of
a good faith  dispute or unless such  failure  has been  cured,  or (c) has been
deemed insolvent or become the subject of a bankruptcy or insolvency proceeding.

     "DISPOSITION"  or "DISPOSE"  means the sale,  transfer,  license,  lease or
other disposition (including any sale and leaseback transaction) of any property
by any Person, including any sale, assignment,  transfer or other disposal, with
or  without  recourse,  of any notes or  accounts  receivable  or any rights and
claims associated therewith.

     "DOLLAR" and "$" mean lawful money of the United States.

     "DOLLAR  EQUIVALENT"  means,  on any particular  date,  with respect to any
amount denominated in Dollars,  such amount of Dollars,  and with respect to any
amount denominated in a currency other than Dollars, the amount (as conclusively
ascertained by the Administrative  Agent absent manifest error) of Dollars which
could be purchased by the Administrative  Agent with such amount or currency (in
accordance with its normal banking practices) in the applicable foreign currency
deposit  markets with such amount of such  currency at the spot rate of exchange
prevailing at or about 11:00 a.m. (Boston time) on such date.

     "DOMESTIC SUBSIDIARY" means any Subsidiary that is organized under the laws
of any political subdivision of the United States.

     "ELIGIBLE  ASSIGNEE" means any Person that meets the  requirements to be an
assignee under SECTION 10.06(B)(III), (V) and (VI) (subject to such consents, if
any, as may be required under SECTION 10.06(B)(III)).

     "ENVIRONMENTAL   INDEMNITY  AGREEMENT"  means  that  certain  Environmental
Indemnity  Agreement,  dated as of the date  hereof,  among the  Borrower,  Yale
Industrial   Products,   Inc.,   Crane   Equipment  &  Service,   Inc.  and  the
Administrative Agent.

     "ENVIRONMENTAL  LAWS" means any and all Federal,  state, local, and foreign
statutes,  laws, regulations,  ordinances,  rules,  judgments,  orders, decrees,
permits, concessions,  grants, franchises,  licenses, agreements or governmental
restrictions  relating to pollution and the protection of the environment or the
release  of any  materials  into the  environment,  including  those  related to

                                      S-9
<PAGE>

hazardous  substances or wastes, air emissions and discharges to waste or public
systems.

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

     "EQUITY  INTERESTS" means, with respect to any Person, all of the shares of
capital stock of (or other ownership or profit interests in) such Person, all of
the warrants,  options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other ownership or profit interests in)
such Person,  all of the securities  convertible into or exchangeable for shares
of capital stock of (or other  ownership or profit  interests in) such Person or
warrants,  rights or options for the purchase or acquisition from such Person of
such shares (or such other interests),  and all of the other ownership or profit
interests  in such  Person  (including  partnership,  member or trust  interests
therein), whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are outstanding on any date of determination.

     "ERISA" means the Employee Retirement Income Security Act of 1974.

     "ERISA AFFILIATE" means any trade or business (whether or not incorporated)
under common  control with the Borrower  within the meaning of Section 414(b) or
(c) of the  Code  (and  Sections  414(m)  and (o) of the Code  for  purposes  of
provisions relating to Section 412 of the Code).

     "ERISA EVENT" means (a) a Reportable  Event with respect to a Pension Plan;
(b) a  withdrawal  by the  Borrower or any ERISA  Affiliate  from a Pension Plan
subject  to  Section  4063  of  ERISA  during  a plan  year  in  which  it was a
substantial  employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of  operations  that is treated as such a withdrawal  under  Section  4062(e) of
ERISA;  (c) a  complete  or  partial  withdrawal  by the  Borrower  or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in  reorganization;  (d) the  filing of a notice of  intent  to  terminate,  the
treatment of a Plan  amendment as a  termination  under Section 4041 or 4041A of
ERISA,  or the  commencement  of  proceedings by the PBGC to terminate a Pension
Plan or Multiemployer  Plan; (e) an event or condition which constitutes grounds
under  Section 4042 of ERISA for the  termination  of, or the  appointment  of a
trustee to  administer,  any  Pension  Plan or  Multiemployer  Plan;  or (f) the
imposition  of any  liability  under  Title  IV of  ERISA,  other  than for PBGC
premiums due but not delinquent  under Section 4007 of ERISA,  upon the Borrower
or any ERISA Affiliate.

     "EURODOLLAR  RATE"  means,  for  any  Interest  Period  with  respect  to a
Eurodollar  Rate  Loan,  the  rate  per  annum  equal  to  the  British  Bankers
Association  LIBOR  Rate  ("BBA  LIBOR"),  as  published  by  Reuters  (or other
commercially available source providing quotations of BBA LIBOR as designated by
the Administrative  Agent from time to time) at approximately 11:00 a.m., London

                                      S-10
<PAGE>

time, two Business Days prior to the commencement of such Interest  Period,  for
Dollar  deposits (for delivery on the first day of such Interest  Period) with a
term equivalent to such Interest  Period.  If such rate is not available at such
time for any reason,  then the "Eurodollar  Rate" for such Interest Period shall
be the rate per annum determined by the  Administrative  Agent to be the rate at
which deposits in Dollars for delivery on the first day of such Interest  Period
in same day funds in the  approximate  amount of the Eurodollar  Rate Loan being
made,  continued or converted by Bank of America and with a term  equivalent  to
such  Interest  Period  would be offered by Bank of America's  London  Branch to
major  banks in the  London  interbank  eurodollar  market at their  request  at
approximately   11:00  a.m.  (London  time)  two  Business  Days  prior  to  the
commencement of such Interest Period.

     "EURODOLLAR RATE LOAN" means a Committed Loan that bears interest at a rate
based on the Eurodollar Rate.

     "EVENT OF DEFAULT" has the meaning specified in SECTION 8.01.

     "EXCLUDED  TAXES"  means,  with respect to the  Administrative  Agent,  any
Lender, the L/C Issuer or any other recipient of any payment to be made by or on
account of any  obligation  of the Borrower  hereunder,  (a) taxes imposed on or
measured by its overall net income  (however  denominated),  and franchise taxes
imposed  on it (in  lieu  of net  income  taxes),  by the  jurisdiction  (or any
political  subdivision  thereof)  under  the laws of  which  such  recipient  is
organized  or in which its  principal  office is located  or, in the case of any
Lender,  in which its  applicable  Lending  Office is  located,  (b) any  branch
profits  taxes  imposed by the United  States or any  similar tax imposed by any
other  jurisdiction  in which the  Borrower  is located and (c) in the case of a
Foreign  Lender  (other than an assignee  pursuant to a request by the  Borrower
under SECTION 10.13),  any withholding tax that is imposed on amounts payable to
such Foreign  Lender at the time such Foreign  Lender becomes a party hereto (or
designates a new Lending  Office) or is  attributable  to such Foreign  Lender's
failure or inability  (other than as a result of a Change in Law) to comply with
SECTION 3.01(E), except to the extent that such Foreign Lender (or its assignor,
if any) was entitled,  at the time of  designation  of a new Lending  Office (or
assignment),  to receive  additional  amounts from the Borrower  with respect to
such withholding tax pursuant to SECTION 3.01(A).

     "EXISTING  CREDIT  AGREEMENT" has the meaning  assigned to such term in the
Recitals.

     "EXISTING  LETTERS  OF  CREDIT"  means any  Letter of Credit  issued by the
Administrative Agent under the Second Amended and Restated Credit Agreement.

     "EXTRAORDINARY  RECEIPTS" means any cash received by the Borrower or any of
its  Subsidiaries  not in the ordinary course of business (and not consisting of
proceeds described in SECTIONS 2.06 (B), (D) or (E) hereof), including,  without
limitation,  (a)  pension  plan  reversions,  (b)  proceeds  of  insurance,  (c)
judgments,  proceeds  of  settlements  or  other  consideration  of any  kind in
connection with any cause of action,  (d)  condemnation  awards (and payments in
lieu thereof),  and (e) indemnity payments;  provided that,  notwithstanding the
foregoing,  (i) amounts  received with respect to any claim made by the Borrower
for over-billing against Blue Cross and Blue Shield and (ii) amounts received by
any Loan Party from the proceeds of that certain escrow  account  established by
Spreckles  Industries,  Inc.  (with such  account  currently  being held by Yale

                                      S-11
<PAGE>

Industrial  Products,  Inc.) to cover worker's  compensation claims made against
Spreckles Industries, Inc., shall not constitute Extraordinary Receipts.

     "FEDERAL  FUNDS RATE"  means,  for any day, the rate per annum equal to the
weighted  average of the rates on  overnight  Federal  funds  transactions  with
members of the Federal  Reserve System arranged by Federal funds brokers on such
day, as  published  by the Federal  Reserve Bank of New York on the Business Day
next succeeding  such day;  PROVIDED that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such  transactions  on
the next preceding Business Day as so published on the next succeeding  Business
Day, and (b) if no such rate is so published  on such next  succeeding  Business
Day,  the  Federal  Funds Rate for such day shall be the average  rate  (rounded
upward,  if  necessary,  to a whole  multiple of 1/100 of 1%) charged to Bank of
America on such day on such  transactions  as determined  by the  Administrative
Agent.

     "FEE LETTER" means the letter agreement, dated February 15, 2006, among the
Borrower, the Administrative Agent and the Arranger.

     "FIRST AMENDED AND RESTATED CREDIT  AGREEMENT" has the meaning  assigned to
such term in the Recitals.

     "FIXED CHARGE COVERAGE RATIO" means, for any Reference Period, the ratio of
(a) (i)  Consolidated  EBITDA for such Reference Period MINUS (ii) the aggregate
amount of all Capital  Expenditures during such Reference Period MINUS (iii) the
aggregate  amount paid,  or required to be paid (without  duplication),  in cash
(but in no event less than zero in the  aggregate)  in  respect  of the  current
portion of all  income  taxes for such  Reference  Period to (b) the sum for the
Borrower  and its  Subsidiaries  (determined  on a  consolidated  basis  without
duplication in accordance  with GAAP),  of (i) the aggregate  amount of Interest
Expense for such Reference  Period,  MINUS,  to the extent  included in Interest
Expense,  the  amortization  during such  Reference  Period of  financing  costs
incurred in connection  with  Indebtedness,  PLUS (ii) the  aggregate  amount of
regularly  scheduled  payments  of  principal  in  respect of  Indebtedness  for
borrowed money (including the principal  component of any payments in respect of
Capital  Lease  Obligations)  paid or required to be paid during such  Reference
Period PLUS (iii) all Restricted Payments made under SECTION 7.06(F) during such
period.

     "FOREIGN LC EXPOSURE" means, at any time, the sum of the Dollar  Equivalent
amounts of (a) 100% of the aggregate  undrawn amount of all outstanding  Letters
of Credit  issued in an Optional  Currency at such time,  PLUS (b) the aggregate
amount of all Letters of Credit issued in an Optional Currency that have not yet
been reimbursed by or on behalf of any Loan Party at such time.

     "FOREIGN  LENDER"  means any Lender that is  organized  under the laws of a
jurisdiction other than that in which the Borrower is resident for tax purposes.
For purposes of this definition,  the United States,  each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.

     "FOREIGN  SUBSIDIARY" means any Subsidiary of the Borrower  organized under
the laws of any  jurisdiction  other  than the  United  States of America or any
State thereof.

                                      S-12
<PAGE>

     "FRB" means the Board of  Governors  of the Federal  Reserve  System of the
United States.

     "FUND" means any Person (other than a natural  person) that is (or will be)
engaged in making,  purchasing,  holding or otherwise  investing  in  commercial
loans and similar extensions of credit in the ordinary course of its business.

     "GAAP" means generally accepted accounting  principles in the United States
set forth in the opinions and pronouncements of the Accounting  Principles Board
and the American  Institute of Certified  Public  Accountants and statements and
pronouncements  of the  Financial  Accounting  Standards  Board  or  such  other
principles  as  may be  approved  by a  significant  segment  of the  accounting
profession in the United States,  that are applicable to the circumstances as of
the date of determination, consistently applied.

     "GOVERNMENTAL  AUTHORITY"  means the government of the United States or any
other nation, or of any political  subdivision thereof,  whether state or local,
and any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative,  judicial, taxing, regulatory
or administrative  powers or functions of or pertaining to government (including
any  supra-national  bodies such as the European  Union or the European  Central
Bank).

     "GRANTING LENDER" has the meaning specified in SECTION 10.06(H).

     "GUARANTEE"  means,  as to any Person,  any (a)  obligation,  contingent or
otherwise,  of such  Person  guaranteeing  or  having  the  economic  effect  of
guaranteeing  any  Indebtedness  or other  obligation  payable or performable by
another  Person  (the  "primary  obligor")  in any manner,  whether  directly or
indirectly, and including any obligation of such Person, direct or indirect, (i)
to purchase or pay (or advance or supply  funds for the  purchase or payment of)
such  Indebtedness  or other  obligation,  (ii) to purchase  or lease  property,
securities  or services  for the  purpose of assuring  the obligee in respect of
such  Indebtedness  or other  obligation of the payment or  performance  of such
Indebtedness or other  obligation,  (iii) to maintain  working  capital,  equity
capital or any other  financial  statement  condition  or  liquidity or level of
income or cash flow of the primary  obligor so as to enable the primary  obligor
to pay such  Indebtedness  or other  obligation,  or (iv)  entered  into for the
purpose  of  assuring  in any  other  manner  the  obligee  in  respect  of such
Indebtedness  or other  obligation of the payment or  performance  thereof or to
protect such obligee  against loss in respect  thereof (in whole or in part), or
(b)  Lien on any  assets  of such  Person  securing  any  Indebtedness  or other
obligation  of any  other  Person,  whether  or not such  Indebtedness  or other
obligation is assumed by such Person (or any right,  contingent or otherwise, of
any  holder of such  Indebtedness  to obtain any such  Lien).  The amount of any
Guarantee  shall be deemed to be an amount  equal to the stated or  determinable
amount of the related  primary  obligation,  or portion  thereof,  in respect of
which such  Guarantee  is made or, if not stated or  determinable,  the  maximum
reasonably  anticipated  liability  in  respect  thereof  as  determined  by the
guaranteeing  Person  in  good  faith.  The  term  "Guarantee"  as a verb  has a
corresponding meaning.

                                      S-13
<PAGE>

     "GUARANTORS" means, collectively, each Subsidiary of the Borrower listed as
"Guarantor" on the signature  pages hereto and each other Person which becomes a
Guarantor hereunder after the Closing Date by complying with the requirements of
SECTION 6.12.

     "GUARANTOR  SECURITY  AGREEMENTS"  means,  collectively  (a) each  Security
Agreement,  dated as of the date hereof,  from a Guarantor to the Administrative
Agent, for the benefit of the Lenders and (b) each additional security agreement
executed by a Guarantor pursuant to SECTION 6.12.

     "GUARANTY"  means  the  Guaranty  made by the  Guarantors  in  favor of the
Administrative Agent and the Lenders, substantially in the form of EXHIBIT F.

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

     "INDEBTEDNESS"  means,  as to any  Person  at a  particular  time,  without
duplication,  all of the following,  whether or not included as  indebtedness or
liabilities in accordance with GAAP:

     (a) all  obligations of such Person for borrowed money and all  obligations
of such Person evidenced by bonds,  debentures,  notes, loan agreements or other
similar instruments;

     (b) all direct or  contingent  obligations  of such  Person  arising  under
letters of credit (including standby and commercial), bankers' acceptances, bank
guaranties, surety bonds and similar instruments;

     (c) net obligations of such Person under any Swap Contract;

     (d) all  obligations  of such Person to pay the deferred  purchase price of
property or services  (other than trade accounts  payable in the ordinary course
of business and, in each case, not past due for more than 90 days after the date
on which such trade account payable was created);

     (e) indebtedness  (excluding prepaid interest thereon) secured by a Lien on
property owned or being purchased by such Person (including indebtedness arising
under  conditional  sales or other title retention  agreements),  whether or not
such  indebtedness  shall  have been  assumed  by such  Person or is  limited in
recourse;

     (f) capital leases and Synthetic Lease Obligations;

     (g) all obligations of such Person to purchase,  redeem, retire, defease or
otherwise  make any payment in respect of any Equity  Interest in such Person or
any other Person, valued, in the case of a redeemable preferred interest, at the
greater of its voluntary or involuntary  liquidation preference PLUS accrued and

                                      S-14
<PAGE>

unpaid dividends; and (h) all Guarantees of such Person in respect of any of the
foregoing.

     For all purposes  hereof,  the Indebtedness of any Person shall include the
Indebtedness  of any  partnership  or joint venture  (other than a joint venture
that is itself a corporation or limited liability  company) in which such Person
is a general partner or a joint venturer,  unless such Indebtedness is expressly
made  non-recourse  to such Person.  The amount of any net obligation  under any
Swap  Contract  on any date  shall be  deemed to be the Swap  Termination  Value
thereof as of such date.  The amount of any  capital  lease or  Synthetic  Lease
Obligation  as of any date  shall be  deemed to be the  amount  of  Attributable
Indebtedness in respect thereof as of such date.

     "INDEMNIFIED    TAXES"   means   Taxes   other   than    Excluded    Taxes.

     "INDEMNITEES" has the meaning specified in SECTION 10.04(B).

     "INFORMATION" has the meaning specified in SECTION 10.07.

     "INTELLECTUAL PROPERTY SECURITY AGREEMENTS" means each Trademark Agreement,
Patent Agreement or Copyright Mortgage.

     "INTERCREDITOR  AGREEMENT" means the Intercreditor  Agreement,  dated as of
July 22, 2003, among the Borrower,  the Administrative Agent and the Senior Note
Indenture Trustee.

     "INTEREST EXPENSE" means, for any period, the sum, without duplication, for
the  Borrower  and its  Subsidiaries  (determined  on a  consolidated  basis  in
accordance  with  GAAP),  of the  following:  (a) all  interest  in  respect  of
Indebtedness  accrued or paid during such period  (whether or not actually  paid
during such period),  PLUS (b) the net amounts payable (or MINUS the net amounts
receivable) in respect of Swap Contracts  accrued during such period (whether or
not actually paid or received  during such period)  excluding  reimbursement  of
legal fees and other similar  transaction costs and excluding  payments required
by  reason of the  early  termination  of  Hedging  Agreements  in effect on the
Closing Date, PLUS (c) all fees,  including  letter of credit fees and expenses,
(but  excluding  reimbursement  of legal  fees),  PLUS (d) the  amortization  of
financing costs incurred in connection with Indebtedness

     "INTEREST  PAYMENT  DATE" means,  (a) as to any Loan other than a Base Rate
Loan,  the last day of each  Interest  Period  applicable  to such  Loan and the
Maturity Date; PROVIDED,  HOWEVER,  that if any Interest Period for a Eurodollar
Rate Loan  exceeds  three  months,  the  respective  dates that fall every three
months  after the  beginning  of such  Interest  Period  shall also be  Interest
Payment Dates;  and (b) as to any Base Rate Loan  (including a Swing Line Loan),
the 15th day of each January, April, July and October and the Maturity Date.

     "INTEREST  PERIOD"  means,  as to each  Eurodollar  Rate  Loan,  the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar  Rate Loan and ending on the date one,  two,  three or
six months thereafter, as selected by the Borrower in its Committed Loan Notice;
PROVIDED that:

          (i) any Interest  Period that would otherwise end on a day that is not
     a Business Day shall be extended to the next succeeding Business Day unless


                                      S-15
<PAGE>

     such  Business  Day falls in  another  calendar  month,  in which case such
     Interest Period shall end on the next preceding Business Day;

          (ii) any  Interest  Period that begins on the last  Business  Day of a
     calendar month (or on a day for which there is no numerically corresponding
     day in the calendar month at the end of such Interest  Period) shall end on
     the last  Business  Day of the calendar  month at the end of such  Interest
     Period; and

          no Interest Period shall extend beyond the Maturity Date.

     "INTERNAL  CONTROL  EVENT"  means a  material  weakness  in, or fraud  that
involves  management  or other  employees  who have a  significant  role in, the
Borrower's internal controls over financial reporting, in each case as described
in the Securities Laws.

     "INVESTMENT" means, as to any Person, any direct or indirect acquisition or
investment  by such  Person,  whether  by  means  of (a) the  purchase  or other
acquisition of capital stock or other securities of another Person,  (b) a loan,
advance or capital  contribution  to,  Guarantee  or  assumption  of debt of, or
purchase  or other  acquisition  of any other  debt or equity  participation  or
interest in, another Person, including any partnership or joint venture interest
in such  other  Person  and any  arrangement  pursuant  to  which  the  investor
Guarantees  Indebtedness  of such other  Person,  or (c) the  purchase  or other
acquisition  (in one  transaction  or a series  of  transactions)  of  assets of
another  Person  that  constitute  a business  unit.  For  purposes  of covenant
compliance,  the amount of any Investment shall be the amount actually invested,
without  adjustment for  subsequent  increases or decreases in the value of such
Investment.

     "IP RIGHTS" has the meaning specified in SECTION 5.18.

     "IRS" means the United States Internal Revenue Service.

     "ISP"  means,  with  respect to any Letter of  Credit,  the  "International
Standby Practices 1998" published by the Institute of International  Banking Law
&  Practice  (or such later  version  thereof as may be in effect at the time of
issuance).

     "ISSUER  DOCUMENTS" means with respect to any Letter of Credit,  the Letter
of Credit Application,  and any other document, agreement and instrument entered
into by the L/C Issuer and the Borrower (or any  Subsidiary) or in favor the L/C
Issuer and relating to such Letter of Credit.

     "LAWS" means, collectively, all international,  foreign, Federal, state and
local statutes, treaties, rules, guidelines, regulations,  ordinances, codes and
administrative   or  judicial   precedents   or   authorities,   including   the
interpretation or administration  thereof by any Governmental  Authority charged
with  the  enforcement,   interpretation  or  administration  thereof,  and  all
applicable   administrative  orders,   directed  duties,   requests,   licenses,
authorizations and permits of, and agreements with, any Governmental  Authority,
in each case whether or not having the force of law.

                                      S-16
<PAGE>

     "L/C ADVANCE" means, with respect to each Lender,  such Lender's funding of
its  participation  in any L/C  Borrowing  in  accordance  with  its  Applicable
Percentage.

     "L/C BORROWING" means an extension of credit resulting from a drawing under
any  Letter of Credit  which  has not been  reimbursed  on the date when made or
refinanced as a Committed Borrowing.

     "L/C CREDIT  EXTENSION"  means,  with respect to any Letter of Credit,  the
issuance thereof or extension of the expiry date thereof, or the increase of the
amount thereof.

     "L/C ISSUER"  means Bank of America in its capacity as issuer of Letters of
Credit hereunder, or any successor issuer of Letters of Credit hereunder.

     "L/C  OBLIGATIONS"  means, as at any date of  determination,  the aggregate
Dollar Equivalent amount available to be drawn under all outstanding  Letters of
Credit  PLUS  the  aggregate  of all  Unreimbursed  Amounts,  including  all L/C
Borrowings. For purposes of computing the amount available to be drawn under any
Letter of Credit,  the amount of such Letter of Credit  shall be  determined  in
accordance with SECTION 1.06. For all purposes of this Agreement, if on any date
of  determination a Letter of Credit has expired by its terms but any amount may
still be drawn  thereunder  by reason of the  operation of Rule 3.14 of the ISP,
such  Letter of Credit  shall be deemed  to be  "outstanding"  in the  amount so
remaining available to be drawn.

     "LENDER" has the meaning  specified in the  introductory  paragraph  hereto
and, as the context requires, includes the Swing Line Lender.

     "LENDING  OFFICE"  means,  as to any Lender,  the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire,  or such
other  office or offices as a Lender may from time to time  notify the  Borrower
and the Administrative Agent.

     "LETTER OF CREDIT" means any letter of credit or banker's acceptance issued
hereunder and any Existing Letter of Credit.

     "LETTER OF CREDIT  APPLICATION"  means an application and agreement for the
issuance or amendment of a Letter of Credit in the form from time to time in use
by the L/C Issuer.

     "LETTER OF CREDIT EXPIRATION DATE" means the day that is five days prior to
the  Maturity  Date then in effect (or, if such day is not a Business  Day,  the
next preceding Business Day).

     "LETTER OF CREDIT FEE" has the meaning specified in SECTION 2.03(I).

     "LETTER OF CREDIT  SUBLIMIT"  means an amount equal to  $20,000,000,  up to
$10,000,000  of which may be  denominated  in an Optional  Currency  pursuant to
SECTION  2.03(A)(I).  The  Letter  of  Credit  Sublimit  is part of,  and not in
addition to, the Aggregate Commitments.

     "LIEN"  means any  mortgage,  pledge,  hypothecation,  assignment,  deposit
arrangement,  encumbrance,  lien  (statutory or other),  charge,  or preference,
priority or other security interest or preferential arrangement in the nature of

                                      S-17
<PAGE>

a security interest of any kind or nature whatsoever  (including any conditional
sale or other title  retention  agreement,  any easement,  right of way or other
encumbrance  on  title  to  real  property,   and  any  financing  lease  having
substantially the same economic effect as any of the foregoing).

     "LOAN"  means an  extension  of credit by a Lender  to the  Borrower  under
ARTICLE II in the form of a Committed Loan or a Swing Line Loan.

     "LOAN DOCUMENTS" means this Agreement, each Note, each Issuer Document, the
Fee Letter, and each of the Security Documents.

     "LOAN PARTIES" means, collectively, the Borrower and each Guarantor.

     "MATERIAL  ADVERSE  EFFECT"  means (a) a material  adverse  change in, or a
material  adverse effect upon, the  operations,  business,  properties,  assets,
liabilities  (actual or  contingent),  condition  (financial  or  otherwise)  or
prospects of the Borrower or the Borrower and its Subsidiaries taken as a whole;
(b) a material  impairment  of the  ability  of any Loan  Party to  perform  its
obligations  under any Loan  Document to which it is a party;  or (c) a material
adverse effect upon the legality,  validity,  binding effect,  enforceability or
rights and remedies of the Administrative  Agent or the Lenders against any Loan
Party under any Loan Document to which it is a party.

     "MATERIAL  RENTAL  OBLIGATION"  means the obligation of the Loan Parties to
pay rent  under any one or more  operating  leases  with  respect to any real or
personal property that is material to the business of the Loan Parties and as to
which the aggregate  amount of all rents payable  during any fiscal year exceeds
$500,000.

     "MATURITY  DATE" means February 22, 2010;  PROVIDED THAT if, on or prior to
February 22, 2010,  (i) the maturity date of the Senior Notes or any  Additional
Subordinated  Indebtedness  is modified to be no earlier than September 22, 2011
or (ii) a reserve  consisting of cash and unused  borrowing  availability  under
this  Agreement  is  established  and  maintained  at  all  times  in an  amount
sufficient,  as defined by the Administrative  Agent in its sole discretion,  to
refinance  the Senior Notes upon their  maturity or the Senior Notes are paid in
full with the proceeds of  Additional  Subordinated  Indebtedness  or otherwise,
"Maturity Date" shall mean February 22, 2011; PROVIDED,  FURTHER,  that, in each
case,  if such date is not a Business  Day, the Maturity  Date shall be the next
preceding Business Day.

     "MORTGAGES" means, collectively,  the several security instruments (whether
designated as a deed of trust or a mortgage,  leasehold mortgage,  assignment of
leases and rents or by any similar  title)  executed  and  delivered by any Loan
Party to the Administrative  Agent, in such form as may be approved by the Agent
in its sole and reasonable discretion, in each case with such changes thereto as
may be  recommended by the  Administrative  Agent's local counsel based on local
laws or customary  local  practices,  with respect to the real property owned or
leased by a Loan Party,  in each case as such  security  instrument or amendment
may be amended, supplemented or otherwise modified from time to time, including,
without limitation,  any mortgages granted to the Administrative Agent after the
Closing Date pursuant to SECTION 6.12.

                                      S-18
<PAGE>

     "MULTIEMPLOYER  PLAN" means any employee benefit plan of the type described
in Section  4001(a)(3)  of ERISA,  to which the Borrower or any ERISA  Affiliate
makes or is obligated to make  contributions,  or during the preceding five plan
years, has made or been obligated to make contributions.

     "NET CASH PROCEEDS" means:

     (a) with respect to the sale of any asset by any Loan Party, the excess, if
any, of (i) the sum of cash and cash  equivalents  received in  connection  with
such sale (including any cash received by way of deferred  payment  pursuant to,
or by monetization  of, a note receivable or otherwise,  but only as and when so
received) over (ii) the sum of (A) the principal amount of any Indebtedness that
is secured by such asset,  so long as the lien  securing  such  Indebtedness  is
permitted  pursuant  to  SECTION  7.01,  and that is  required  to be  repaid in
connection  with  the sale  thereof  (other  than  Indebtedness  under  the Loan
Documents),  (B) the  out-of-pocket  expenses  incurred  by such  Loan  Party in
connection  with such  sale and (C)  income  taxes  reasonably  estimated  to be
actually  payable  within two years of the date of the relevant  asset sale as a
result of any gain recognized in connection therewith; and

     (b) with respect to the sale of any capital stock or other equity  interest
or the incurrence of any  Indebtedness by any Loan Party,  the excess of (i) the
sum of the cash and cash  equivalents  received in connection  with such sale or
incurrence  over (ii) the  underwriting  discounts  and  commissions,  and other
out-of-pocket expenses, incurred by such Loan Party in connection with such sale
or incurrence.

     "NON-CASH CHARGES" means, with respect to any calculation of net income for
any period,  all  non-cash  extraordinary  losses and  charges  deducted in such
calculation  (as  determined in accordance  with GAAP  (excluding  inventory and
account receiveable write-downs and charge-offs), including, without limitation,
non-cash  recognition  of unrealized  declines in the market value of marketable
securities  recorded in accordance  with FASB Statement No. 115,  non-cash asset
impairment  charges  recorded in accordance with FASB Statement No. 142 and FASB
Statement No. 144, and non-cash restructuring charges.

     "NOTE"  means a  promissory  note made by the Borrower in favor of a Lender
evidencing Loans made by such Lender, substantially in the form of EXHIBIT C.

     "OBLIGATIONS"  means (i) all  indebtedness,  obligations and liabilities of
the Borrower and its  Subsidiaries  to any of the  Lenders,  the  Administrative
Agent,  the L/C Issuer and cash management  service  providers,  individually or
collectively,  existing on the  Closing  Date or arising  thereafter,  direct or
indirect,  joint or  several,  absolute  or  contingent,  matured or  unmatured,
liquidated or unliquidated, secured or unsecured, arising by contract, operation
of law or  otherwise,  arising or incurred  under this  Agreement  or any of the
other Loan Documents or in respect of any of the Loans,  the Notes,  the Letters
of Credit or other  instruments at any time  evidencing any thereof,  including,
without  limitation,  the  aggregate  outstanding  principal  balance of and all
interest  on the  Loans  made by the  Lenders  to the  Borrower  (including  any
interest  accruing  after the  commencement  of any proceeding by or against the
Borrower under the federal bankruptcy laws, as now or hereafter constituted,  or
any other applicable  federal or state  bankruptcy,  insolvency or other similar
law, and any other interest that would have accrued but for the  commencement of

                                      S-19
<PAGE>

such  proceeding,  whether  or not  any  such  interest  is  allowed  as a claim
enforceable against the Borrower in any such proceeding),  and all reimbursement
obligations in respect of Letters of Credit,  (ii) all LC  Disbursements,  (iii)
all fees, costs, charges, expenses and other obligations from time to time owing
to the  Lenders,  the L/C Issuer,  the  Administrative  Agent,  cash  management
service providers or any of their Affiliates by the Loan Parties or any of their
Subsidiaries  hereunder or under any other Loan Document, and (iv) all overdraft
obligations,  fees, costs, charges,  expenses and other obligations from time to
time owing to the  Lenders,  the L/C  Issuer,  the  Administrative  Agent,  cash
management  service  providers or any of their Affiliates by the Loan Parties or
any of their  Subsidiaries  in respect  of any Swap  Contract,  cash  management
agreement  (including ACH transactions),  operating or deposit account, or other
banking  product from time to time made  available to the Loan Parties or any of
their Subsidiaries by the Administrative  Agent, the L/C Issuer, cash management
service providers, any Lender or any of their Affiliates.

     "OPTIONAL  CURRENCY" means any of the following  currencies:  Mexican peso,
Canadian  dollars,  Danish crowns,  or the "Euro",  Japanese yen, United Kingdom
pounds sterling or Chinese yuan.

     "ORGANIZATION  DOCUMENTS"  means, (a) with respect to any corporation,  the
certificate  or  articles  of  incorporation  and the bylaws (or  equivalent  or
comparable  constitutive  documents with respect to any non-U.S.  jurisdiction);
(b) with respect to any limited liability  company,  the certificate or articles
of formation or organization  and operating  agreement;  and (c) with respect to
any  partnership,  joint venture,  trust or other form of business  entity,  the
partnership,  joint  venture  or other  applicable  agreement  of  formation  or
organization  and any  agreement,  instrument,  filing  or notice  with  respect
thereto  filed  in  connection  with  its  formation  or  organization  with the
applicable  Governmental  Authority  in the  jurisdiction  of its  formation  or
organization  and, if  applicable,  any  certificate or articles of formation or
organization of such entity.

     "ORIGINAL  CREDIT  AGREEMENT" has the meaning  assigned to such term in the
Recitals.

     "OTHER TAXES" means all present or future stamp or documentary taxes or any
other  excise or property  taxes,  charges or similar  levies  arising  from any
payment made  hereunder or under any other Loan Document or from the  execution,
delivery or enforcement  of, or otherwise with respect to, this Agreement or any
other Loan Document.

     "OUTSTANDING  AMOUNT"  means (i) with respect to Committed  Loans and Swing
Line Loans on any date, the aggregate outstanding principal amount thereof after
giving effect to any borrowings and prepayments or repayments of Committed Loans
and Swing Line Loans, as the case may be,  occurring on such date; and (ii) with
respect to any L/C Obligations on any date, the Dollar Equivalent amount of such
L/C  Obligations  on such date after giving  effect to any L/C Credit  Extension
occurring on such date and any other changes in the aggregate  amount of the L/C
Obligations as of such date,  including as a result of any reimbursements by the
Borrower of Unreimbursed Amounts.

     "PARTICIPANT" has the meaning specified in SECTION 10.06(D).

                                      S-20
<PAGE>

     "PATENT AGREEMENT" means any grant of security interest in patents, made by
any Loan Party in favor of the Administrative Agent, or any of its predecessors,
including,  without  limitation  that certain Patent  Collateral  Assignment and
Security  Agreement,  dated as of November 21, 2002,  by and among the Borrower,
Yale  Industrial  Products,  Inc. and Fleet Capital  Corporation  (n/k/a Bank of
America, N.A.) as agent, as amended, restated, replaced or assigned from time to
time,  including as amended by that certain First Amendment to Patent Collateral
Assignment and Security Agreement, dated as of the Closing Date.

     "PBGC" means the Pension Benefit Guaranty Corporation.

     "PCAOB" means the Public Company Accounting Oversight Board.

     "PENSION PLAN" means any "employee  pension  benefit plan" (as such term is
defined in Section  3(2) of ERISA),  other than a  Multiemployer  Plan,  that is
subject to Title IV of ERISA and is sponsored or  maintained  by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate  contributes
or has an obligation  to  contribute,  or in the case of a multiple  employer or
other plan described in Section 4064(a) of ERISA, has made  contributions at any
time during the immediately preceding five plan years.

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

     "PLAN"  means any  "employee  benefit  plan" (as such  term is  defined  in
Section 3(3) of ERISA)  established by the Borrower or, with respect to any such
plan that is subject to Section 412 of the Code or Title IV of ERISA,  any ERISA
Affiliate.

     "PLATFORM" has the meaning specified in SECTION 6.02.

     "PLEDGE AGREEMENT" means any pledge agreement, between a Loan Party and the
Administrative  Agent, pursuant to which any Loan Party pledges any stock, other
equity interests or intercompany notes held by it, including, without limitation
that certain Pledge  Agreement,  dated as of November 21, 2002, by and among the
Borrower,  Audubon West, Inc., Crane Equipment & Service, Inc. and Fleet Capital
Corporation  (n/k/a  Bank of  America,  N.A.) as agent,  as  amended,  restated,
replaced or assigned  from time to time,  including,  as amended by that certain
First Amendment to Pledge Agreement, dated as of the Closing Date.

     "REFERENCE  PERIOD" means, as of any date of  determination,  the period of
four (4) consecutive fiscal quarters of the Borrower and its Subsidiaries ending
on such date,  or if such date is not a fiscal  quarter end date,  the period of
four (4)  consecutive  fiscal quarters most recently ended (in each case treated
as a single accounting period).

     "REGISTER" has the meaning specified in SECTION 10.06(C).

     "REGISTERED  PUBLIC  ACCOUNTING  FIRM"  has the  meaning  specified  in the
Securities  Laws and shall be  independent  of the Borrower as prescribed by the
Securities Laws.

                                      S-21
<PAGE>

     "RELATED  PARTIES"  means,  with  respect  to  any  Person,  such  Person's
Affiliates and the partners, directors, officers, employees, agents and advisors
of such Person and of such Person's Affiliates.

     "RELATED REAL ESTATE  DOCUMENTS" - with respect to any real estate  subject
to a Mortgage, the following,  in form and substance reasonably  satisfactory to
Administrative Agent and received by Administrative Agent for review at least 15
days prior to the effective date of the Mortgage (or such shorter length of time
acceptable  to  Administrative  Agent  in  its  reasonable  discretion):  (a)  a
mortgagee  title policy (or binder  therefor)  covering  Administrative  Agent's
interest under the Mortgage,  in a form and amount and by an insurer  reasonably
acceptable to Administrative  Agent,  which must be fully paid on such effective
date;  (b) such  assignments  of leases,  rents,  estoppel  letters,  attornment
agreements,  consents,  waivers and releases as Administrative Agent may require
with  respect to other  Persons  having an  interest in the real  estate;  (c) a
current,  as-built  survey of the real  estate,  containing  a  metes-and-bounds
property description and flood plain certification,  and certified by a licensed
surveyor reasonably  acceptable to Administrative  Agent; (d) flood insurance in
an  amount,  with  endorsements  and  by an  insurer  reasonably  acceptable  to
Administrative  Agent, if the real estate is within a flood plain; (e) a current
appraisal of the real estate,  prepared by an appraiser reasonably acceptable to
Administrative  Agent,  and in  form  and  substance  satisfactory  to  Required
Lenders;  (f) a Phase I (and to the extent appropriate,  Phase II) environmental
assessment  report,  prepared by an  environmental  consulting  firm  reasonably
satisfactory  to   Administrative   Agent,  and  accompanied  by  such  reports,
certificates,  studies or data as Administrative  Agent may reasonably  require,
which  shall  all  be  in  form  and  substance   reasonably   satisfactory   to
Administrative  Agent;  and (g) an  environmental  indemnity  agreement and such
other  documents,   instruments  or  agreements  as  Administrative   Agent  may
reasonably  require with respect to any  environmental  risks regarding the real
estate.

     "REPORTABLE  EVENT" means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.

     "REQUEST  FOR CREDIT  EXTENSION"  means (a) with  respect  to a  Borrowing,
conversion or continuation of Committed Loans, a Committed Loan Notice, (b) with
respect to an L/C Credit Extension, a Letter of Credit Application, and (c) with
respect to a Swing Line Loan, a Swing Line Loan Notice.

     "REQUIRED  LENDERS" means, as of any date of determination,  Lenders having
more than 50% of the Aggregate  Commitments or, if the commitment of each Lender
to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions
have been terminated  pursuant to SECTION 8.02, Lenders holding in the aggregate
more  than 50% of the Total  Outstandings  (with  the  aggregate  amount of each
Lender's risk  participation  and funded  participation  in L/C  Obligations and
Swing  Line Loans  being  deemed  "held" by such  Lender  for  purposes  of this
definition);  PROVIDED  that the  Commitment  of,  and the  portion of the Total
Outstandings held or deemed held by, any Defaulting Lender shall be excluded for
purposes of making a determination of Required Lenders.

     "RESET DATE" has the meaning specified in SECTION 2.07(C)(II).

                                      S-22
<PAGE>

     "RESPONSIBLE OFFICER" means the chief executive officer,  president,  chief
financial officer, treasurer,  secretary, assistant treasurer or controller of a
Loan Party.  Any document  delivered  hereunder  that is signed by a Responsible
Officer of a Loan Party shall be  conclusively  presumed to have been authorized
by all necessary corporate,  partnership and/or other action on the part of such
Loan Party and such Responsible  Officer shall be conclusively  presumed to have
acted on behalf of such Loan Party.

     "RESTRICTED PAYMENT" means (i) any dividend or other distribution  (whether
in cash,  securities  or other  property)  with respect to any capital  stock or
other Equity Interest of the Borrower or any Subsidiary, or any payment (whether
in cash,  securities or other  property),  including any sinking fund or similar
deposit,  on  account  of the  purchase,  redemption,  retirement,  acquisition,
cancellation or termination of any such capital stock or other Equity  Interest,
or on account of any return of capital to the Borrower's stockholders,  partners
or members (or the equivalent Person thereof), (ii) any redemption,  retirement,
sinking fund or similar payment, purchase or other acquisition for value, direct
or indirect,  of any shares of any class of stock of, or other  equity  interest
in,  any Loan Party or any of its  Subsidiaries  now or  hereafter  outstanding,
(iii) any payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of stock of, or
other equity  interest in, any Loan Party or any of its  Subsidiaries,  (iv) any
payment or  prepayment  of  principal  of,  premium,  if any, or interest on, or
redemption  purchase,  retirement,   defeasance  (including  economic  or  legal
defeasance),  sinking  fund  or  similar  payment  with  respect  to the  Senior
Subordinated Notes, Senior Notes,  Additional  Subordinated  Indebtedness and/or
any intercompany  Indebtedness  owing by the Borrower or any Guarantor,  and (v)
any payment made to any Affiliates of any Loan Party or any of its  Subsidiaries
in respect of management,  consulting or other similar services  provided to any
Loan Party or any of its Subsidiaries.

     "SARBANES-OXLEY" means the Sarbanes-Oxley Act of 2002.

     "SEC" means the Securities  and Exchange  Commission,  or any  Governmental
Authority succeeding to any of its principal functions.

     "SECOND AMENDED AND RESTATED CREDIT  AGREEMENT" has the meaning assigned to
such term in the Recitals.

     "SECURITIES LAWS" means the Securities Act of 1933, the Securities Exchange
Act  of  1934,   Sarbanes-Oxley  and  the  applicable  accounting  and  auditing
principles, rules, standards and practices promulgated, approved or incorporated
by the SEC or the PCAOB.

     "SECURITY DOCUMENTS" means collectively,  the Mortgages,  the Guaranty, the
Pledge  Agreements,  the Borrower  Security  Agreement,  the Guarantor  Security
Agreements,  the Environmental  Indemnity Agreement,  the Intellectual  Property
Security Agreements,  any assignments of intercompany Indebtedness and all other
security  agreements,  UCC financing  statements,  and any other  instruments or
documents  required by the  Administrative  Agent to be  executed  or  delivered
hereunder to secure the Obligations.

                                      S-23
<PAGE>

     "SENIOR LEVERAGE RATIO" means, as of any date of  determination,  the ratio
of (a) Senior Net  Funded  Indebtedness  of the  Borrower  and its  Subsidiaries
outstanding on such date TO (b)  Consolidated  EBITDA for Reference Period ended
on such date.

     "SENIOR NET FUNDED INDEBTEDNESS"  means, at any time of determination,  the
sum of Total Funded Indebtedness (which shall include the L/C Obligations) MINUS
the principal amount of the Senior Subordinated Notes or Additional Subordinated
Indebtedness outstanding at such time.

     "SENIOR NOTE DOCUMENTS"  means the Senior Notes,  the Senior Note Indenture
and all other documents,  instruments and agreements executed and delivered with
respect to the Senior Notes or Senior Note Indenture,  in each case, as the same
shall be further amended,  supplemented or otherwise modified and in effect from
time to time."

     "SENIOR  NOTE  INDENTURE"  means the  Indenture  dated as of July 22, 2003,
between the Borrower and the Senior Note Indenture  Trustee,  as in effect as of
the date hereof and as thereafter  amended from time to time in accordance  with
the provisions hereof.

     "SENIOR NOTE INDENTURE TRUSTEE" means U.S. Bank Trust National Association,
or any successor thereto as trustee under the Senior Note Indenture.

     "SENIOR NOTES" means the  Borrower's  10% senior  secured notes,  due 2010,
issued  pursuant to the Senior Note  Indenture,  as such notes may be  modified,
supplement  or  amended  from  time to time in  accordance  with the  provisions
hereof.

     "SENIOR  SUBORDINATED  NOTE DOCUMENTS" means the Senior  Subordinated  Note
Indenture,  the Senior  Subordinated Notes and all other documents,  instruments
and agreements executed and delivered in connection with the Senior Subordinated
Notes,  in each case, as the same shall,  subject to the terms and conditions of
this Agreement,  be amended,  supplemented  or otherwise  modified and in effect
from time to time.

     "SENIOR   SUBORDINATED   NOTE  INDENTURE"   means  the  Columbus   McKinnon
Corporation  8 ?%  Senior  Subordinated  Notes Due 2013  Indenture,  dated as of
September 2, 2005,  between the Borrower,  as issuer, and U.S. Bank, as trustee,
as the same shall,  subject to the terms and  conditions of this  Agreement,  be
further amended,  supplemented or otherwise  modified and in effect from time to
time.

     "SENIOR  SUBORDINATED  NOTES" means the Borrower's 8 ?% senior subordinated
notes due 2013, issued pursuant to the Senior  Subordinated  Note Indenture,  as
the same  shall,  subject  to the terms and  conditions  of this  Agreement,  be
amended, supplemented or otherwise modified and in effect from time to time.

     "SIGNIFICANT  SUBSIDIARY"  means  any  Subsidiary  of  the  Borrower  which
accounts for more than fifteen percent of one or more of:

     (a) the book  value of the  consolidated  assets  of the  Borrower  and its
Subsidiaries; or

                                      S-24
<PAGE>

     (b) the consolidated revenues of the Borrower and its Subsidiaries,

     all as shown in the  financial  statements  most recently  delivered  under
SECTION 6.01(A) or (B).

     "SIGNIFICANT  DOMESTIC  SUBSIDIARY" means any Domestic Subsidiary that is a
Significant Subsidiary.

     "SOLVENT" means,  with respect to any Person on a particular date, that, at
fair valuations,  (a) the sum of such Person's assets is greater than (x) all of
such Person's  consolidated  liabilities  (including  contingent,  subordinated,
unmatured and unliquidated  liabilities) and (y) the amount required to pay such
liabilities  as they become  absolute,  matured or  otherwise  become due in the
normal course of business,  (b) such Person has the ability to pay its debts and
liabilities  (including  contingent,  subordinated,  unmatured and  unliquidated
liabilities)  as they become  absolute,  matured or otherwise  become due in the
normal  course of business  and (c) such  Person  does not have an  unreasonably
small amount of capital with which to conduct its business.

     "SPC" has the meaning specified in SECTION 10.06(H).

     "SUBSIDIARY" of a Person means a corporation,  partnership,  joint venture,
limited  liability  company or other business  entity of which a majority of the
shares of securities or other  interests  having  ordinary  voting power for the
election  of  directors  or other  governing  body  (other  than  securities  or
interests  having such power only by reason of the  happening of a  contingency)
are at the time  beneficially  owned,  or the  management  of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by  such  Person.  Unless  otherwise  specified,  all  references  herein  to  a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
the Borrower.

     "SWAP CONTRACT" means (a) any and all rate swap transactions,  basis swaps,
credit  derivative  transactions,  forward rate  transactions,  commodity swaps,
commodity options, forward commodity contracts,  equity or equity index swaps or
options,  bond or bond price or bond index  swaps or options or forward  bond or
forward bond price or forward bond index  transactions,  interest  rate options,
forward foreign exchange  transactions,  cap transactions,  floor  transactions,
collar  transactions,  currency  swap  transactions,  cross-currency  rate  swap
transactions,   currency   options,   spot  contracts,   or  any  other  similar
transactions or any  combination of any of the foregoing  (including any options
to enter  into any of the  foregoing),  whether or not any such  transaction  is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related  confirmations,  which are subject to the terms and
conditions  of, or governed  by, any form of master  agreement  published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange  Master  Agreement,  or any other  master  agreement  (any such  master
agreement, together with any related schedules, a "MASTER AGREEMENT"), including
any such obligations or liabilities under any Master Agreement.

     "SWAP  TERMINATION  VALUE"  means,  in  respect  of any  one or  more  Swap
Contracts,  after  taking into  account  the effect of any  legally  enforceable
netting agreement relating to such Swap Contracts,  (a) for any date on or after
the date such Swap  Contracts  have been  closed  out and  termination  value(s)

                                      S-25
<PAGE>

determined in accordance therewith,  such termination value(s),  and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts  (which may include a Lender or any Affiliate of a
Lender).

     "SWING LINE" means the revolving credit  sub-facility made available by the
Swing Line Lender pursuant to SECTION 2.04.

     "SWING LINE  BORROWING"  means a borrowing of a Swing Line Loan pursuant to
SECTION 2.04.

     "SWING LINE  LENDER"  means Bank of America in its  capacity as provider of
Swing Line Loans, or any successor swing line lender hereunder.

     "SWING LINE LOAN" has the meaning specified in SECTION 2.04(A).

     "SWING LINE LOAN NOTICE" means a notice of a Swing Line Borrowing  pursuant
to SECTION 2.04(B),  which, if in writing, shall be substantially in the form of
EXHIBIT B.

     "SWING LINE SUBLIMIT" means an amount equal to the lesser of (a) $7,500,000
and (b) the Aggregate  Commitments.  The Swing Line Sublimit is part of, and not
in addition to, the Aggregate Commitments.

     "SYNTHETIC  LEASE  OBLIGATION"  means the monetary  obligation  of a Person
under (a) a so-called  synthetic,  off-balance  sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such Person but which, upon the insolvency
or bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

     "TAXES"  means  all  present  or future  taxes,  levies,  imposts,  duties,
deductions,  withholdings,  assessments,  fees or other  charges  imposed by any
Governmental  Authority,  including any interest,  additions to tax or penalties
applicable thereto.

     "THRESHOLD AMOUNT" means $2,000,000.

     "TOTAL  FUNDED  INDEBTEDNESS"  means,  with respect to the Borrower and its
Subsidiaries,  the sum,  without  duplication,  of (a) the  aggregate  amount of
Indebtedness of the Borrower and its  Subsidiaries  determined on a consolidated
basis in  accordance  with GAAP,  relating to (i) the  borrowing of money or the
obtaining of credit, including the issuance of notes or bonds, (ii) the deferred
purchase  price of assets  (other than trade  payables  incurred in the ordinary
course of business),  (iii) in respect of any Synthetic Lease Obligations or any
Capital Lease Obligations, and (iv) the maximum drawing amount of all letters of
credit outstanding,  plus (b) Indebtedness of the type referred to in clause (a)
of another Person guaranteed by the Borrower or any of its Subsidiaries.

                                      S-26
<PAGE>

     "TOTAL  OUTSTANDINGS"  means the aggregate  Outstanding Amount of all Loans
and all L/C Obligations.

     "TRADEMARK  AGREEMENT" means any grant of security  interest in trademarks,
made by any  Loan  Party in favor  of the  Administrative  Agent,  or any of its
predecessors,  including,  without limitation that certain Trademark  Collateral
Security and Pledge  Agreement,  dated as of November 21, 2002, by and among the
Borrower,  Yale Industrial  Products,  Inc. and Fleet Capital Corporation (n/k/a
Bank of America, N.A.) as agent, as amended, restated, replaced or assigned from
time to time,  including as amended by that certain First Amendment to Trademark
Collateral Security and Pledge Agreement, dated as of the Closing Date.

     "TYPE"  means,  with respect to a Committed  Loan,  its character as a Base
Rate Loan or a Eurodollar Rate Loan.

     "UNFUNDED  PENSION  LIABILITY" means the excess of a Pension Plan's benefit
liabilities  under Section  4001(a)(16) of ERISA, over the current value of that
Pension Plan's assets,  determined in accordance with the  assumptions  used for
funding the Pension Plan pursuant to Section 412 of the Code for the  applicable
plan year.

     "UNITED STATES" and "U.S." mean the United States of America.

     "UNREIMBURSED AMOUNT" has the meaning specified in SECTION 2.03(C)(I).

     1.02. OTHER INTERPRETIVE  PROVISIONS.  With reference to this Agreement and
each other Loan Document,  unless  otherwise  specified  herein or in such other
Loan Document:

     (a) 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,
(i) any  definition  of or  reference  to any  agreement,  instrument  or  other
document  (including any Organization  Document) shall be construed as referring
to such  agreement,  instrument or other  document as from time to time amended,
supplemented  or  otherwise  modified  (subject  to  any  restrictions  on  such
amendments,  supplements or modifications  set forth herein or in any other Loan
Document), (ii) any reference herein to any Person shall be construed to include
such Person's  successors and assigns,  (iii) the words  "HEREIN,"  "HEREOF" and
"HEREUNDER,"  and words of similar import when used in any Loan Document,  shall
be  construed  to refer to such Loan  Document  in its  entirety  and not to any
particular  provision  thereof,  (iv)  all  references  in a  Loan  Document  to
Articles,  Sections,  Exhibits  and  Schedules  shall be  construed  to refer to
Articles and Sections of, and Exhibits and  Schedules  to, the Loan  Document in
which such  references  appear,  (v) any  reference to any law shall include all
statutory  and  regulatory  provisions  consolidating,  amending,  replacing  or
interpreting such law and any reference to any law or regulation  shall,  unless
otherwise  specified,  refer to such law or regulation  as amended,  modified or
supplemented  from time to time, and (vi) the words "ASSET" and "PROPERTY" shall
be  construed  to have the same  meaning  and effect and to refer to any and all

                                      S-27
<PAGE>

tangible and  intangible  assets and  properties,  including  cash,  securities,
accounts and contract rights.

     (b) In the  computation of periods of time from a specified date to a later
specified  date, the word "FROM" means "FROM AND  INCLUDING;" the words "TO" and
"UNTIL"  each  mean "TO BUT  EXCLUDING;"  and the word  "THROUGH"  means "TO AND
INCLUDING."

     (c) Section  headings  herein and in the other Loan  Documents are included
for  convenience  of reference only and shall not affect the  interpretation  of
this Agreement or any other Loan Document.

     1.03.   ACCOUNTING   TERMS.   (a)  GENERALLY.   All  accounting  terms  not
specifically or completely defined herein shall be construed in conformity with,
and  all  financial  data  (including   financial  ratios  and  other  financial
calculations)  required  to be  submitted  pursuant to this  Agreement  shall be
prepared in conformity  with,  GAAP applied on a consistent  basis, as in effect
from time to time,  applied in a manner  consistent  with that used in preparing
the Audited Financial Statements,  EXCEPT as otherwise  specifically  prescribed
herein.

     (b)  CHANGES IN GAAP.  If at any time any  change in GAAP would  affect the
computation  of any  financial  ratio  or  requirement  set  forth  in any  Loan
Document,  and either the Borrower or the Required Lenders shall so request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith
to amend such ratio or  requirement  to preserve the original  intent thereof in
light of such change in GAAP (subject to the approval of the Required  Lenders);
PROVIDED THAT, until so amended, (i) such ratio or requirement shall continue to
be computed in  accordance  with GAAP prior to such change  therein and (ii) the
Borrower  shall provide to the  Administrative  Agent and the Lenders  financial
statements  and other  documents  required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation  between calculations of such
ratio or requirement made before and after giving effect to such change in GAAP.

     1.04.  ROUNDING.  Any  financial  ratios  required to be  maintained by the
Borrower  pursuant  to this  Agreement  shall  be  calculated  by  dividing  the
appropriate  component by the other component,  carrying the result to one place
more than the  number of places by which  such  ratio is  expressed  herein  and
rounding  the result up or down to the nearest  number  (with a  rounding-up  if
there is no nearest number).

     1.05. TIMES OF DAY. Unless otherwise  specified,  all references  herein to
times of day shall be  references  to Eastern time  (daylight  or  standard,  as
applicable).

     1.06.  LETTER OF CREDIT AMOUNTS.  Unless otherwise  specified  herein,  the
amount of a Letter of Credit at any time shall be deemed to be the stated amount
of such Letter of Credit in effect at such time;  provided,  however,  that with
respect  to any Letter of Credit  that,  by its terms or the terms of any Issuer
Document  related thereto,  provides for one or more automatic  increases in the
stated amount thereof, the amount of such Letter of Credit shall be deemed to be
the maximum  stated  amount of such Letter of Credit after giving  effect to all
such  increases,  whether or not such maximum stated amount is in effect at such
time.

                                      S-28
<PAGE>

                                  ARTICLE II.
                      THE COMMITMENTS AND CREDIT EXTENSIONS

     2.01.  COMMITTED  LOANS.  (a) Subject to the terms and conditions set forth
herein, each Lender severally agrees to make loans (each such loan, a "COMMITTED
LOAN") to the  Borrower  from  time to time,  on any  Business  Day  during  the
Availability  Period,  in  an  aggregate  amount  not  to  exceed  at  any  time
outstanding  the amount of such Lender's  Commitment;  PROVIDED,  HOWEVER,  that
after giving effect to any Committed Borrowing, (i) the Total Outstandings shall
not exceed the Aggregate Commitments,  and (ii) the aggregate Outstanding Amount
of the Committed Loans of any Lender, PLUS such Lender's  Applicable  Percentage
of the Outstanding Amount of all L/C Obligations,  PLUS such Lender's Applicable
Percentage  of the  Outstanding  Amount of all Swing Line Loans shall not exceed
such Lender's  Commitment.  Within the limits of each Lender's  Commitment,  and
subject to the other terms and conditions  hereof, the Borrower may borrow under
this SECTION 2.01,  prepay under SECTION 2.05,  and reborrow  under this SECTION
2.01.  Committed  Loans may be Base Rate  Loans or  Eurodollar  Rate  Loans,  as
further provided herein.

     (b) As of the Closing Date,  there are $0 of Loans  outstanding and Letters
of Credit  with a face  amount of  $7,497,893.63  outstanding  under the  Second
Amended and Restated  Credit  Agreement.  Pursuant to a separate  Assignment and
Assumption Agreement, dated as of the Closing Date, the lenders under the Second
Amended  and  Restated  Credit  Agreement  have  assigned  such Loans to Bank of
America,  N.A.,  effective as of the Closing  Date.  Effective as of the Closing
Date,  (i) such Loans under the Second  Amended and  Restated  Credit  Agreement
shall be amended and restated as Loans hereunder and (ii) Bank of America,  N.A.
hereby assigns a portion of the  Commitment to the Lenders  hereunder such that,
after giving effect to such assignment,  the Commitments of the Lenders shall be
as set forth on SCHEDULE  2.01. The terms and provisions of Annex 1 of Exhibit E
(Assignment  and Assumption)  are hereby  incorporated  herein by reference such
that the foregoing  assignment  shall be subject to the terms and  conditions of
such Annex 1 of Exhibit E (Assignment and Assumption).

     2.02. BORROWINGS, CONVERSIONS AND CONTINUATIONS OF COMMITTED LOANS.

     (a) Each Committed  Borrowing,  each conversion of Committed Loans from one
Type to the other, and each  continuation of Eurodollar Rate Loans shall be made
upon the Borrower's irrevocable notice to the Administrative Agent, which may be
given by  telephone.  Each such notice  must be  received by the  Administrative
Agent not later than 11:00 a.m. (i) three  Business  Days prior to the requested
date of any Borrowing of, conversion to or continuation of Eurodollar Rate Loans
or of any conversion of Eurodollar Rate Loans to Base Rate Committed  Loans, and
(ii) on the requested date of any Borrowing of Base Rate Committed  Loans.  Each
telephonic  notice by the  Borrower  pursuant to this  SECTION  2.02(A)  must be
confirmed  promptly  by  delivery  to  the  Administrative  Agent  of a  written
Committed  Loan  Notice,  appropriately  completed  and signed by a  Responsible
Officer of the Borrower.  Each Borrowing of,  conversion to or  continuation  of
Eurodollar  Rate Loans shall be in a principal  amount of  $2,000,000 or a whole
multiple of $500,000 in excess thereof.  Except as provided in SECTIONS  2.03(C)
and 2.04(C),  each Borrowing of or conversion to Base Rate Committed Loans shall
be in a principal  amount of $500,000 or a whole  multiple of $100,000 in excess
thereof.  Each  Committed  Loan Notice  (whether  telephonic  or written)  shall

                                      S-29
<PAGE>

specify  (i)  whether  the  Borrower is  requesting  a  Committed  Borrowing,  a
conversion of Committed  Loans from one Type to the other,  or a continuation of
Eurodollar Rate Loans,  (ii) the requested date of the Borrowing,  conversion or
continuation,  as the case may be (which  shall be a  Business  Day),  (iii) the
principal amount of Committed Loans to be borrowed, converted or continued, (iv)
the Type of Committed Loans to be borrowed or to which existing  Committed Loans
are to be converted, and (v) if applicable,  the duration of the Interest Period
with respect thereto.  If the Borrower fails to specify a Type of Committed Loan
in a Committed  Loan  Notice or if the  Borrower  fails to give a timely  notice
requesting a conversion or  continuation,  then the applicable  Committed  Loans
shall  be made as,  or  converted  to,  Base  Rate  Loans.  Any  such  automatic
conversion  to Base  Rate  Loans  shall be  effective  as of the last day of the
Interest  Period then in effect with respect to the applicable  Eurodollar  Rate
Loans. If the Borrower  requests a Borrowing of,  conversion to, or continuation
of Eurodollar Rate Loans in any such Committed Loan Notice, but fails to specify
an Interest  Period,  it will be deemed to have specified an Interest  Period of
one month.

     (b) Following receipt of a Committed Loan Notice, the Administrative  Agent
shall promptly notify each Lender of the amount of its Applicable  Percentage of
the  applicable  Committed  Loans,  and if no timely  notice of a conversion  or
continuation is provided by the Borrower,  the Administrative Agent shall notify
each  Lender of the  details  of any  automatic  conversion  to Base Rate  Loans
described in the  preceding  subsection.  In the case of a Committed  Borrowing,
each  Lender  shall  make the  amount of its  Committed  Loan  available  to the
Administrative  Agent  in  immediately  available  funds  at the  Administrative
Agent's  Office not later than 1:00 p.m. on the  Business  Day  specified in the
applicable Committed Loan Notice. Upon satisfaction of the applicable conditions
set  forth in  SECTION  4.02  (and,  if such  Borrowing  is the  initial  Credit
Extension,  SECTION  4.01),  the  Administrative  Agent  shall make all funds so
received   available   to  the  Borrower  in  like  funds  as  received  by  the
Administrative  Agent either by (i) crediting the account of the Borrower on the
books of Bank of America with the amount of such funds or (ii) wire  transfer of
such  funds,  in each case in  accordance  with  instructions  provided  to (and
reasonably  acceptable to) the Administrative  Agent by the Borrower;  PROVIDED,
HOWEVER,  that if, on the date the  Committed  Loan Notice with  respect to such
Borrowing is given by the Borrower,  there are L/C Borrowings outstanding,  then
the proceeds of such Borrowing,  FIRST,  shall be applied to the payment in full
of any such L/C Borrowings,  and SECOND, shall be made available to the Borrower
as provided above.

     (c) Except as otherwise  provided  herein,  a  Eurodollar  Rate Loan may be
continued  or  converted  only on the last day of an  Interest  Period  for such
Eurodollar  Rate  Loan.  During  the  existence  of a  Default,  no Loans may be
requested  as,  converted to or continued as  Eurodollar  Rate Loans without the
consent of the Required Lenders.

     (d) The  Administrative  Agent shall  promptly  notify the Borrower and the
Lenders of the interest rate  applicable to any Interest  Period for  Eurodollar
Rate Loans upon  determination  of such interest  rate. At any time prior to the
date on which the Commitments have been  terminated,  the  Administrative  Agent
shall  notify the  Borrower  and the Lenders of any change in Bank of  America's
prime  rate used in  determining  the Base Rate  promptly  following  the public
announcement of such change.

                                      S-30
<PAGE>

     (e) After giving effect to all Committed  Borrowings,  all  conversions  of
Committed Loans from one Type to the other,  and all  continuations of Committed
Loans as the same Type,  there  shall not be more than ten  Interest  Periods in
effect with respect to Committed Loans.

     2.03. LETTERS OF CREDIT.

     (a) THE LETTER OF CREDIT COMMITMENT.

          (i) Subject to the terms and conditions set forth herein,  (A) the L/C
     Issuer agrees,  in reliance upon the agreements of the Lenders set forth in
     this  SECTION  2.03,  (1) from time to time on any  Business Day during the
     period from the Closing Date until the Letter of Credit Expiration Date, to
     issue   Letters  of  Credit  for  the  account  of  the   Borrower  or  its
     Subsidiaries, and to amend or extend Letters of Credit previously issued by
     it, in accordance  with  subsection  (b) below,  and (2) to honor  drawings
     under  the  Letters  of  Credit;  and (B) the  Lenders  severally  agree to
     participate  in Letters of Credit issued for the account of the Borrower or
     its  Subsidiaries and any drawings  thereunder;  PROVIDED that after giving
     effect to any L/C Credit  Extension  with  respect to any Letter of Credit,
     (x) the Total Outstandings shall not exceed the Aggregate Commitments,  (y)
     the aggregate Outstanding Amount of the Committed Loans of any Lender, PLUS
     such Lender's  Applicable  Percentage of the Outstanding  Amount of all L/C
     Obligations,  PLUS such Lender's  Applicable  Percentage of the Outstanding
     Amount of all Swing Line Loans shall not exceed such  Lender's  Commitment,
     and (z) the Outstanding  Amount of the L/C Obligations shall not exceed the
     Letter of Credit  Sublimit.  Subject to the other terms and  conditions set
     forth  herein,  the  Borrower  may request the  issuance of such Letters of
     Credit in an Optional Currency; PROVIDED, however, that, in addition to the
     other  conditions  to the  issuance  of Letters of Credit set forth in this
     SECTION  2.03(A)(I),  after  giving  effect  to such  request,  the  Dollar
     Equivalent of the Foreign LC Exposure  shall not exceed  $10,000,000 at any
     one time. Such Letters of Credit issued in an Optional  Currency  hereunder
     shall constitute  utilization of the Aggregate Commitments in the amount of
     the  Dollar  Equivalent  of such  Letter of  Credit.  Each  request  by the
     Borrower  for the  issuance  or  amendment  of a Letter of Credit  shall be
     deemed to be a representation by the Borrower that the L/C Credit Extension
     so requested  complies with the  conditions set forth in the proviso to the
     preceding  sentence.  Within the foregoing limits, and subject to the terms
     and conditions  hereof,  the Borrower's ability to obtain Letters of Credit
     shall be fully  revolving,  and  accordingly  the Borrower may,  during the
     foregoing  period,  obtain  Letters of Credit to replace  Letters of Credit
     that have expired or that have been drawn upon and reimbursed. All Existing
     Letters of Credit shall be deemed to have been issued pursuant hereto,  and
     from and after the  Closing  Date shall be subject to and  governed  by the
     terms of and conditions hereof.

          (ii) The L/C Issuer shall not issue any Letter of Credit, if:

               (A)  subject to  SECTION  2.03(B)(III),  the expiry  date of such
          requested  Letter of Credit would occur more than twelve  months after
          the date of issuance or last  extension,  unless the Required  Lenders
          have approved such expiry date; or

                                      S-31
<PAGE>

               (B) the  expiry  date of such  requested  Letter of Credit  would
          occur  after the  Letter of Credit  Expiration  Date,  unless  all the
          Lenders have approved such expiry date.

          (iii) The L/C Issuer  shall not be under any  obligation  to issue any
     Letter of Credit if:

               (A) any order,  judgment or decree of any Governmental  Authority
          or arbitrator shall by its terms purport to enjoin or restrain the L/C
          Issuer from issuing such Letter of Credit,  or any Law  applicable  to
          the L/C Issuer or any request or directive  (whether or not having the
          force of law) from any Governmental  Authority with  jurisdiction over
          the L/C Issuer shall prohibit,  or request that the L/C Issuer refrain
          from,  the  issuance of letters of credit  generally or such Letter of
          Credit in  particular or shall impose upon the L/C Issuer with respect
          to  such  Letter  of  Credit  any  restriction,   reserve  or  capital
          requirement  (for  which the L/C Issuer is not  otherwise  compensated
          hereunder) not in effect on the Closing Date, or shall impose upon the
          L/C  Issuer  any  unreimbursed  loss,  cost or  expense  which was not
          applicable  on the Closing Date and which the L/C Issuer in good faith
          deems material to it;

               (B) the  issuance of such Letter of Credit  would  violate one or
          more  policies  of the L/C  Issuer  applicable  to  letters  of credit
          generally;

               (C) such  Letter  of Credit is to be  denominated  in a  currency
          other than Dollars or an Optional Currency;

               (D) such Letter of Credit  contains any  provisions for automatic
          reinstatement of the stated amount after any drawing thereunder; or

               (E) a default of any Lender's  obligations  to fund under SECTION
          2.03(C)  exists  or any  Lender is at such  time a  Defaulting  Lender
          hereunder,  unless  the  L/C  Issuer  has  entered  into  satisfactory
          arrangements  with the  Borrower or such Lender to  eliminate  the L/C
          Issuer's risk with respect to such Lender.

          (iv) The L/C  Issuer  shall not amend any  Letter of Credit if the L/C
     Issuer  would not be  permitted at such time to issue such Letter of Credit
     in its amended form under the terms hereof.

          (v) The L/C Issuer shall be under no obligation to amend any Letter of
     Credit if (A) the L/C Issuer would have no obligation at such time to issue
     such Letter of Credit in its amended  form under the terms  hereof,  or (B)
     the  beneficiary  of such  Letter of Credit  does not accept  the  proposed
     amendment to such Letter of Credit.

          (vi) The L/C Issuer shall act on behalf of the Lenders with respect to
     any Letters of Credit issued by it and the documents associated  therewith,
     and the L/C  Issuer  shall  have all of the  benefits  and  immunities  (A)
     provided to the Administrative Agent in ARTICLE IX with respect to any acts
     taken or omissions suffered by the L/C Issuer in connection with Letters of

                                      S-32
<PAGE>

     Credit  issued by it or  proposed  to be issued by it and Issuer  Documents
     pertaining   to  such   Letters   of   Credit  as  fully  as  if  the  term
     "Administrative  Agent" as used in ARTICLE IX included  the L/C Issuer with
     respect to such acts or omissions,  and (B) as additionally provided herein
     with respect to the L/C Issuer.

     (b)   Procedures   for  Issuance  and   Amendment  of  Letters  of  Credit;
Auto-Extension Letters of Credit.

          (i) Each Letter of Credit shall be issued or amended,  as the case may
     be, upon the request of the  Borrower  delivered  to the L/C Issuer (with a
     copy to the  Administrative  Agent)  in the  form  of a  Letter  of  Credit
     Application, appropriately completed and signed by a Responsible Officer of
     the Borrower. Such Letter of Credit Application must be received by the L/C
     Issuer and the Administrative  Agent not later than 11:00 a.m. at least two
     Business Days (or such later date and time as the Administrative  Agent and
     the L/C Issuer may agree in a particular instance in their sole discretion)
     prior to the proposed  issuance date or date of amendment,  as the case may
     be. In the case of a request for an initial issuance of a Letter of Credit,
     such  Letter  of  Credit  Application  shall  specify  in form  and  detail
     satisfactory  to the L/C  Issuer:  (A) the  proposed  issuance  date of the
     requested  Letter of Credit (which shall be a Business Day); (B) the amount
     thereof;  (C) the  expiry  date  thereof;  (D) the name and  address of the
     beneficiary  thereof; (E) the documents to be presented by such beneficiary
     in case of any drawing thereunder;  (F) the full text of any certificate to
     be presented by such beneficiary in case of any drawing thereunder; and (G)
     such other matters as the L/C Issuer may require.  In the case of a request
     for an amendment of any outstanding Letter of Credit, such Letter of Credit
     Application shall specify in form and detail satisfactory to the L/C Issuer
     (A) the Letter of Credit to be amended;  (B) the proposed date of amendment
     thereof  (which  shall be a Business  Day);  (C) the nature of the proposed
     amendment;  and (D) such  other  matters  as the L/C  Issuer  may  require.
     Additionally,  the  Borrower  shall  furnish  to the  L/C  Issuer  and  the
     Administrative  Agent such other  documents and  information  pertaining to
     such requested Letter of Credit issuance or amendment, including any Issuer
     Documents, as the L/C Issuer or the Administrative Agent may require.

          (ii) Promptly after receipt of any Letter of Credit  Application,  the
     L/C Issuer will confirm with the  Administrative  Agent (by telephone or in
     writing) that the  Administrative  Agent has received a copy of such Letter
     of Credit  Application  from the Borrower  and, if not, the L/C Issuer will
     provide the Administrative Agent with a copy thereof. Unless the L/C Issuer
     has received written notice from any Lender,  the  Administrative  Agent or
     any Loan Party,  at least one Business Day prior to the  requested  date of
     issuance or amendment of the applicable Letter of Credit,  that one or more
     applicable  conditions contained in ARTICLE IV shall not then be satisfied,
     then,  subject to the terms and conditions hereof, the L/C Issuer shall, on
     the  requested  date,  issue a Letter  of  Credit  for the  account  of the
     Borrower  (or the  applicable  Subsidiary)  or enter  into  the  applicable
     amendment,  as the case may be,  in each  case in  accordance  with the L/C
     Issuer's  usual and  customary  business  practices.  Immediately  upon the
     issuance  of each  Letter of Credit,  each  Lender  shall be deemed to, and
     hereby  irrevocably  and  unconditionally  agrees to, purchase from the L/C

                                      S-33
<PAGE>

     Issuer a risk  participation in such Letter of Credit in an amount equal to
     the product of such Lender's Applicable Percentage TIMES the amount of such
     Letter of Credit.

          (iii) If the Borrower so requests in any  applicable  Letter of Credit
     Application, the L/C Issuer may, in its sole and absolute discretion, agree
     to issue a Letter of Credit that has automatic extension  provisions (each,
     an   "AUTO-EXTENSION   LETTER   OF   CREDIT");   PROVIDED   that  any  such
     Auto-Extension  Letter of Credit  must permit the L/C Issuer to prevent any
     such extension at least once in each twelve-month  period  (commencing with
     the date of  issuance of such  Letter of Credit) by giving  30-days'  prior
     notice to the beneficiary thereof (the "NON-EXTENSION NOTICE DATE"). Unless
     otherwise directed by the L/C Issuer, the Borrower shall not be required to
     make a specific  request to the L/C Issuer for any such extension.  Once an
     Auto-Extension  Letter of Credit  has been  issued,  the  Lenders  shall be
     deemed to have  authorized  (but may not  require) the L/C Issuer to permit
     the  extension  of such  Letter of Credit at any time to an expiry date not
     later than the Letter of Credit Expiration Date;  PROVIDED,  HOWEVER,  that
     the L/C Issuer  shall not permit any such  extension  if (A) the L/C Issuer
     has determined that it would not be permitted, or would have no obligation,
     at such  time to issue  such  Letter  of  Credit  in its  revised  form (as
     extended)  under the terms  hereof (by reason of the  provisions  of clause
     (ii) or (iii) of SECTION  2.03(A)  or  otherwise),  or (B) it has  received
     notice  (which may be by telephone or in writing) on or before the day that
     is five  Business  Days before the  Non-Extension  Notice Date (1) from the
     Administrative  Agent that the Required  Lenders have elected not to permit
     such  extension  or (2) from the  Administrative  Agent,  any Lender or the
     Borrower that one or more of the applicable conditions specified in SECTION
     4.02 is not then satisfied,  and in each such case directing the L/C Issuer
     not to permit such extension.

          (iv)  Promptly  after  its  delivery  of any  Letter  of Credit or any
     amendment to a Letter of Credit to an advising bank with respect thereto or
     to the  beneficiary  thereof,  the L/C  Issuer  will  also  deliver  to the
     Borrower  and the  Administrative  Agent a true and  complete  copy of such
     Letter of Credit or amendment.

     (c) DRAWINGS AND REIMBURSEMENTS; FUNDING OF PARTICIPATIONS.

          (i) Upon receipt from the  beneficiary  of any Letter of Credit of any
     notice of a drawing  under  such  Letter of Credit,  the L/C  Issuer  shall
     notify the Borrower and the  Administrative  Agent thereof.  Not later than
     11:00 a.m. on the date of any  payment by the L/C Issuer  under a Letter of
     Credit (each such date, an "HONOR DATE"),  the Borrower shall reimburse the
     L/C Issuer through the  Administrative  Agent in Dollars in an amount equal
     to the Dollar Equivalent  amount of such drawing.  If the Borrower fails to
     so reimburse the L/C Issuer by such time,  the  Administrative  Agent shall
     promptly notify each Lender of the Honor Date, the Dollar Equivalent amount
     of the unreimbursed drawing (the "UNREIMBURSED  AMOUNT"), and the amount of
     such Lender's  Applicable  Percentage  thereof. In such event, the Borrower
     shall be deemed to have requested a Committed  Borrowing of Base Rate Loans
     to be disbursed  on the Honor Date in an amount  equal to the  Unreimbursed
     Amount,  without  regard to the minimum and multiples  specified in SECTION
     2.02 for the principal amount of Base Rate Loans, but subject to the amount

                                      S-34
<PAGE>

     of the unutilized  portion of the Aggregate  Commitments and the conditions
     set forth in SECTION  4.02  (other than the  delivery  of a Committed  Loan
     Notice).  Any notice  given by the L/C Issuer or the  Administrative  Agent
     pursuant  to  this  SECTION   2.03(c)(i)  may  be  given  by  telephone  if
     immediately  confirmed  in  writing;  PROVIDED  that  the  lack  of such an
     immediate  confirmation  shall not  affect  the  conclusiveness  or binding
     effect of such notice.

          (ii) Each Lender shall upon any notice pursuant to SECTION  2.03(C)(I)
     make funds available to the Administrative Agent for the account of the L/C
     Issuer at the  Administrative  Agent's  Office  in an  amount  equal to its
     Applicable  Percentage of the Unreimbursed  Amount not later than 1:00 p.m.
     on the Business Day specified in such notice by the  Administrative  Agent,
     whereupon,  subject to the provisions of SECTION 2.03(C)(III),  each Lender
     that so makes  funds  available  shall be  deemed  to have made a Base Rate
     Committed  Loan to the Borrower in such amount.  The  Administrative  Agent
     shall remit the funds so received to the L/C Issuer.

          (iii)  With  respect  to any  Unreimbursed  Amount  that is not  fully
     refinanced  by a  Committed  Borrowing  of  Base  Rate  Loans  because  the
     conditions  set forth in SECTION  4.02 cannot be satisfied or for any other
     reason,  the Borrower  shall be deemed to have incurred from the L/C Issuer
     an L/C  Borrowing in the amount of the  Unreimbursed  Amount that is not so
     refinanced,  which  L/C  Borrowing  shall  be due  and  payable  on  demand
     (together  with  interest)  and shall bear interest at the Default Rate. In
     such  event,  each  Lender's  payment to the  Administrative  Agent for the
     account of the L/C Issuer pursuant to SECTION  2.03(C)(II)  shall be deemed
     payment in respect of its  participation  in such L/C  Borrowing  and shall
     constitute  an  L/C  Advance  from  such  Lender  in  satisfaction  of  its
     participation obligation under this SECTION 2.03.

          (iv)  Until  each  Lender  funds  its  Committed  Loan or L/C  Advance
     pursuant to this SECTION 2.03(C) to reimburse the L/C Issuer for any amount
     drawn  under any Letter of  Credit,  interest  in respect of such  Lender's
     Applicable Percentage of such amount shall be solely for the account of the
     L/C Issuer.

          (v) Each Lender's  obligation to make Committed  Loans or L/C Advances
     to reimburse the L/C Issuer for amounts  drawn under Letters of Credit,  as
     contemplated by this SECTION 2.03(C),  shall be absolute and  unconditional
     and shall not be affected by any  circumstance,  including  (A) any setoff,
     counterclaim, recoupment, defense or other right which such Lender may have
     against the L/C  Issuer,  the  Borrower or any other  Person for any reason
     whatsoever;  (B) the  occurrence or  continuance  of a Default,  or (C) any
     other occurrence,  event or condition, whether or not similar to any of the
     foregoing;  PROVIDED,  HOWEVER,  that  each  Lender's  obligation  to  make
     Committed  Loans  pursuant  to  this  SECTION  2.03(C)  is  subject  to the
     conditions  set forth in SECTION 4.02 (other than  delivery by the Borrower
     of a Committed Loan Notice). No such making of an L/C Advance shall relieve
     or otherwise  impair the  obligation  of the Borrower to reimburse  the L/C
     Issuer  for the  amount of any  payment  made by the L/C  Issuer  under any
     Letter of Credit, together with interest as provided herein.

                                      S-35
<PAGE>

          (vi) If any Lender fails to make available to the Administrative Agent
     for the  account of the L/C Issuer any amount  required  to be paid by such
     Lender pursuant to the foregoing  provisions of this SECTION 2.03(C) by the
     time specified in SECTION 2.03(C)(II),  the L/C Issuer shall be entitled to
     recover from such Lender  (acting  through the  Administrative  Agent),  on
     demand, such amount with interest thereon for the period from the date such
     payment  is  required  to the date on which  such  payment  is  immediately
     available to the L/C Issuer at a rate per annum equal to the greater of the
     Federal  Funds Rate and a rate  determined  by the L/C Issuer in accordance
     with  banking   industry   rules  on  interbank   compensation,   plus  any
     administrative,  processing or similar fees customarily  charged by the L/C
     Issuer in connection  with the  foregoing.  If such Lender pays such amount
     (with interest and fees as aforesaid),  the amount so paid shall constitute
     such Lender's Committed Loan included in the relevant  Committed  Borrowing
     or L/C Advance in respect of the  relevant L/C  Borrowing,  as the case may
     be. A certificate  of the L/C Issuer  submitted to any Lender  (through the
     Administrative  Agent) with respect to any amounts  owing under this clause
     (vi) shall be conclusive absent manifest error.

     (d) REPAYMENT OF PARTICIPATIONS.

          (i) At any time  after the L/C  Issuer  has made a  payment  under any
     Letter of Credit and has received from any Lender such Lender's L/C Advance
     in respect of such  payment in  accordance  with  SECTION  2.03(C),  if the
     Administrative Agent receives for the account of the L/C Issuer any payment
     in respect of the related  Unreimbursed Amount or interest thereon (whether
     directly  from  the  Borrower  or  otherwise,  including  proceeds  of Cash
     Collateral applied thereto by the Administrative Agent), the Administrative
     Agent will distribute to such Lender its Applicable  Percentage  thereof in
     the same funds as those received by the Administrative Agent.

          (ii) If any  payment  received  by the  Administrative  Agent  for the
     account of the L/C Issuer pursuant to SECTION  2.03(C)(I) is required to be
     returned  under  any  of  the  circumstances  described  in  SECTION  10.05
     (including pursuant to any settlement entered into by the L/C Issuer in its
     discretion),  each  Lender  shall pay to the  Administrative  Agent for the
     account of the L/C Issuer its  Applicable  Percentage  thereof on demand of
     the  Administrative  Agent,  plus  interest  thereon  from the date of such
     demand to the date such amount is returned  by such  Lender,  at a rate per
     annum  equal to the  Federal  Funds Rate from time to time in  effect.  The
     obligations  of the Lenders  under this clause shall survive the payment in
     full of the Obligations and the termination of this Agreement.

     (e) OBLIGATIONS  ABSOLUTE.  The obligation of the Borrower to reimburse the
L/C Issuer for each  drawing  under each  Letter of Credit and to repay each L/C
Borrowing shall be absolute,  unconditional  and irrevocable,  and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including the following:

          (i) any lack of validity or  enforceability  of such Letter of Credit,
     this Agreement, or any other Loan Document;

          (ii) the  existence  of any claim,  counterclaim,  setoff,  defense or
     other  right  that  the  Borrower  or any  Subsidiary  may have at any time
     against any  beneficiary or any transferee of such Letter of Credit (or any

                                      S-36
<PAGE>

     Person for whom any such beneficiary or any such transferee may be acting),
     the L/C  Issuer  or any  other  Person,  whether  in  connection  with this
     Agreement, the transactions contemplated hereby or by such Letter of Credit
     or  any  agreement  or  instrument   relating  thereto,  or  any  unrelated
     transaction;

          (iii) any draft, demand, certificate or other document presented under
     such  Letter  of  Credit  proving  to be  forged,  fraudulent,  invalid  or
     insufficient  in any  respect  or any  statement  therein  being  untrue or
     inaccurate  in any  respect;  or any loss or delay in the  transmission  or
     otherwise  of any document  required in order to make a drawing  under such
     Letter of Credit;

          (iv) any payment by the L/C Issuer under such Letter of Credit against
     presentation  of a draft or certificate  that does not strictly comply with
     the terms of such  Letter of Credit so long as the L/C Issuer has not acted
     with gross negligence or willful misconduct; or any payment made by the L/C
     Issuer under such Letter of Credit to any Person purporting to be a trustee
     in bankruptcy, debtor-in-possession, assignee for the benefit of creditors,
     liquidator,  receiver  or  other  representative  of or  successor  to  any
     beneficiary  or any  transferee  of such  Letter of Credit,  including  any
     arising in connection with any proceeding under any Debtor Relief Law; or

          (v) any other  circumstance  or happening  whatsoever,  whether or not
     similar to any of the  foregoing,  including  any other  circumstance  that
     might otherwise  constitute a defense  available to, or a discharge of, the
     Borrower or any Subsidiary.

     The  Borrower  shall  promptly  examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance  with  the  Borrower's  instructions  or other  irregularity,  the
Borrower will promptly notify the L/C Issuer. The Borrower shall be conclusively
deemed  to  have  waived  any  such  claim   against  the  L/C  Issuer  and  its
correspondents unless such notice is given as aforesaid.

     (f) ROLE OF L/C ISSUER.  Each Lender and the Borrower agree that, in paying
any  drawing  under a  Letter  of  Credit,  the L/C  Issuer  shall  not have any
responsibility to obtain any document (other than any sight draft,  certificates
and  documents  expressly  required by the Letter of Credit) or to  ascertain or
inquire as to the validity or accuracy of any such  document or the authority of
the Person  executing or delivering any such  document.  None of the L/C Issuer,
the  Administrative  Agent,  any of their  respective  Related  Parties  nor any
correspondent,  participant or assignee of the L/C Issuer shall be liable to any
Lender for (i) any action taken or omitted in connection herewith at the request
or with the approval of the Lenders or the Required Lenders, as applicable; (ii)
any  action  taken or  omitted in the  absence  of gross  negligence  or willful
misconduct;   or  (iii)   the  due   execution,   effectiveness,   validity   or
enforceability of any document or instrument  related to any Letter of Credit or
Issuer Document.  The Borrower hereby assumes all risks of the acts or omissions
of any  beneficiary  or  transferee  with  respect  to its use of any  Letter of
Credit;  PROVIDED,  HOWEVER,  that this assumption is not intended to, and shall
not,  preclude the  Borrower's  pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement.  None
of the L/C Issuer,  the  Administrative  Agent, any of their respective  Related
Parties nor any  correspondent,  participant or assignee of the L/C Issuer shall
be liable or responsible for any of the matters described in clauses (i) through

                                      S-37
<PAGE>

(v) of SECTION 2.03(E); PROVIDED,  HOWEVER, that anything in such clauses to the
contrary notwithstanding,  the Borrower may have a claim against the L/C Issuer,
and the L/C Issuer may be liable to the Borrower, to the extent, but only to the
extent,  of any  direct,  as  opposed to  consequential  or  exemplary,  damages
suffered  by the  Borrower  which the  Borrower  proves  were  caused by the L/C
Issuer's  willful  misconduct or gross  negligence  or the L/C Issuer's  willful
failure to pay under any Letter of Credit  after the  presentation  to it by the
beneficiary  of a sight draft and  certificate(s)  strictly  complying  with the
terms and conditions of a Letter of Credit. In furtherance and not in limitation
of the foregoing,  the L/C Issuer may accept documents that appear on their face
to be in order, without responsibility for further investigation,  regardless of
any  notice or  information  to the  contrary,  and,  in the  absence of the L/C
Issuer's  gross  negligence or willful  misconduct,  the L/C Issuer shall not be
responsible  for the validity or sufficiency of any instrument  transferring  or
assigning or  purporting  to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.

     (g) CASH COLLATERAL.  Upon the request of the Administrative  Agent, (i) if
the L/C Issuer has honored any full or partial  drawing request under any Letter
of Credit and such drawing has resulted in an L/C  Borrowing,  or (ii) if, as of
the Letter of Credit  Expiration Date, any L/C Obligation for any reason remains
outstanding,  the Borrower shall, in each case,  immediately Cash  Collateralize
the then Outstanding  Amount of all L/C  Obligations.  SECTIONS 2.05 and 8.02(C)
set forth certain additional  requirements to deliver Cash Collateral hereunder.
For  purposes of this SECTION  2.03,  SECTION  2.05 and SECTION  8.02(C),  "CASH
COLLATERALIZE" means to pledge and deposit with or deliver to the Administrative
Agent, for the benefit of the L/C Issuer and the Lenders,  as collateral for the
L/C Obligations,  cash or deposit account balances  pursuant to documentation in
form and substance  satisfactory to the Administrative  Agent and the L/C Issuer
(which  documents are hereby  consented to by the Lenders).  Derivatives of such
term  have   corresponding   meanings.   The  Borrower   hereby  grants  to  the
Administrative  Agent,  for the  benefit of the L/C Issuer  and the  Lenders,  a
security  interest in all such cash,  deposit  accounts and all balances therein
and all  proceeds of the  foregoing.  Cash  Collateral  shall be  maintained  in
blocked, non-interest bearing deposit accounts at Bank of America.

     (h) APPLICABILITY OF ISP AND UCP. Unless otherwise  expressly agreed by the
L/C Issuer and the  Borrower  when a Letter of Credit is issued  (including  any
such agreement applicable to an Existing Letter of Credit), (i) the rules of the
ISP shall  apply to each  standby  Letter of  Credit,  and (ii) the rules of the
Uniform Customs and Practice for Documentary Credits, as most recently published
by the International  Chamber of Commerce at the time of issuance shall apply to
each commercial Letter of Credit.

     (i) LETTER OF CREDIT  FEES.  The Borrower  shall pay to the  Administrative
Agent  for  the  account  of each  Lender  in  accordance  with  its  Applicable
Percentage  a Letter of Credit fee (the  "LETTER OF CREDIT FEE") for each Letter
of Credit equal to the  Applicable  Rate TIMES the daily amount  available to be
drawn under such Letter of Credit.  For purposes of  computing  the daily amount
available  to be drawn under any Letter of Credit,  the amount of such Letter of
Credit shall be  determined in  accordance  with SECTION 1.06.  Letter of Credit
Fees shall be (i) due and payable in Dollars on the fifth  Business  Day of each
of March, June,  September and December,  commencing with the first such date to
occur  after the  issuance  of such  Letter of  Credit,  on the Letter of Credit

                                      S-38
<PAGE>

Expiration  Date and thereafter on demand and (ii) computed on a quarterly basis
in arrears.  If there is any change in the  Applicable  Rate during any quarter,
the daily  amount  available  to be drawn under each  Letter of Credit  shall be
computed and multiplied by the Applicable Rate separately for each period during
such quarter that such Applicable Rate was in effect.  Notwithstanding  anything
to the contrary  contained  herein,  upon the request of the  Required  Lenders,
while any Event of Default exists, all Letter of Credit Fees shall accrue at the
Default Rate.

     (j) FRONTING FEE AND  DOCUMENTARY  AND  PROCESSING  CHARGES  PAYABLE TO L/C
ISSUER.  The Borrower shall pay directly to the L/C Issuer for its own account a
fronting  fee with  respect  to each  Letter  of  Credit,  at the rate per annum
specified in the Fee Letter,  computed on the daily amount available to be drawn
under such Letter of Credit on a quarterly  basis in arrears.  Such fronting fee
shall be due and payable on the tenth  Business Day after the end of each March,
June,  September  and December in respect of the most  recently-ended  quarterly
period (or portion thereof,  in the case of the first payment),  commencing with
the first such date to occur after the issuance of such Letter of Credit, on the
Letter of Credit  Expiration  Date and  thereafter  on demand.  For  purposes of
computing the daily amount available to be drawn under any Letter of Credit, the
amount of such Letter of Credit shall be determined  in accordance  with SECTION
1.06. In addition, the Borrower shall pay directly to the L/C Issuer for its own
account the customary  issuance,  presentation,  amendment and other  processing
fees,  and other  standard  costs and  charges,  of the L/C Issuer  relating  to
letters  of credit  as from  time to time in  effect.  Such  customary  fees and
standard costs and charges are due and payable on demand and are nonrefundable.

     (k) CONFLICT WITH ISSUER  DOCUMENTS.  In the event of any conflict  between
the terms  hereof and the terms of any Issuer  Document,  the terms hereof shall
control.

     (l)  LETTERS OF CREDIT  ISSUED  FOR  SUBSIDIARIES.  Notwithstanding  that a
Letter  of  Credit  issued  or  outstanding  hereunder  is  in  support  of  any
obligations  of, or is for the account of, a Subsidiary,  the Borrower  shall be
obligated to reimburse the L/C Issuer  hereunder for any and all drawings  under
such Letter of Credit.  The Borrower  hereby  acknowledges  that the issuance of
Letters of Credit for the account of  Subsidiaries  inures to the benefit of the
Borrower, and that the Borrower's business derives substantial benefits from the
businesses of such Subsidiaries.

     2.04. SWING LINE LOANS.

     (a) THE SWING LINE.  Subject to the terms and  conditions set forth herein,
the Swing Line Lender  agrees,  in  reliance  upon the  agreements  of the other
Lenders set forth in this SECTION  2.04, to make loans (each such loan, a "SWING
LINE LOAN") to the  Borrower  from time to time on any  Business  Day during the
Availability Period in an aggregate amount not to exceed at any time outstanding
the amount of the Swing Line Sublimit,  notwithstanding the fact that such Swing
Line Loans,  when aggregated  with the Applicable  Percentage of the Outstanding
Amount of Committed Loans and L/C Obligations of the Lender acting as Swing Line
Lender, may exceed the amount of such Lender's  Commitment;  PROVIDED,  HOWEVER,
that after  giving  effect to any Swing Line  Loan,  (i) the Total  Outstandings
shall not exceed the Aggregate  Commitments,  and (ii) the aggregate Outstanding
Amount of the  Committed  Loans of any  Lender,  PLUS such  Lender's  Applicable
Percentage of the Outstanding Amount of all L/C Obligations,  PLUS such Lender's

                                      S-39
<PAGE>

Applicable  Percentage of the  Outstanding  Amount of all Swing Line Loans shall
not exceed such Lender's Commitment,  and PROVIDED,  FURTHER,  that the Borrower
shall not use the proceeds of any Swing Line Loan to refinance  any  outstanding
Swing Line Loan. Within the foregoing limits, and subject to the other terms and
conditions hereof, the Borrower may borrow under this SECTION 2.04, prepay under
SECTION 2.05, and reborrow  under this SECTION 2.04.  Each Swing Line Loan shall
be a Base Rate Loan.  Immediately  upon the  making of a Swing  Line Loan,  each
Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the Swing Line Lender a risk participation in such Swing Line Loan
in an amount equal to the product of such Lender's  Applicable  Percentage TIMES
the amount of such Swing Line Loan.

     (b) BORROWING PROCEDURES.  Each Swing Line Borrowing shall be made upon the
Borrower's  irrevocable  notice to the Swing Line Lender and,  provided that the
Swing  Line  Lender is not the same  entity  as the  Administrative  Agent,  the
Administrative Agent, which may be given by telephone.  Each such notice must be
received  by the Swing Line Lender and the  Administrative  Agent not later than
1:00 p.m. on the requested  borrowing  date, and shall specify (i) the amount to
be  borrowed,  which  shall be a minimum  of  $100,000,  and (ii) the  requested
borrowing date, which shall be a Business Day. Each such telephonic  notice must
be   confirmed   promptly   by  delivery  to  the  Swing  Line  Lender  and  the
Administrative  Agent  of  a  written  Swing  Line  Loan  Notice,  appropriately
completed and signed by a Responsible  Officer of the Borrower.  Promptly  after
receipt by the Swing Line Lender of any telephonic  Swing Line Loan Notice,  the
Swing Line Lender will confirm with the Administrative Agent (by telephone or in
writing)  that the  Administrative  Agent has also received such Swing Line Loan
Notice and, if not, the Swing Line Lender will notify the  Administrative  Agent
(by  telephone  or in writing) of the  contents  thereof.  Unless the Swing Line
Lender has received notice (by telephone or in writing) from the  Administrative
Agent (including at the request of any Lender) prior to 2:00 p.m. on the date of
the proposed  Swing Line  Borrowing  (A)  directing the Swing Line Lender not to
make  such  Swing  Line  Loan as a result  of the  limitations  set forth in the
proviso to the first sentence of SECTION 2.04(A), or (B) that one or more of the
applicable  conditions  specified  in  ARTICLE IV is not then  satisfied,  then,
subject to the terms and  conditions  hereof,  the Swing Line Lender  will,  not
later than 3:00 p.m. on the  borrowing  date  specified  in such Swing Line Loan
Notice,  make the amount of its Swing Line Loan available to the Borrower at its
office by  crediting  the account of the Borrower on the books of the Swing Line
Lender in immediately available funds.

     (c) REFINANCING OF SWING LINE LOANS.

          (i) The  Swing  Line  Lender  at any  time in its  sole  and  absolute
     discretion may request, on behalf of the Borrower (which hereby irrevocably
     authorizes  the Swing Line Lender to so request on its  behalf),  that each
     Lender make a Base Rate  Committed Loan in an amount equal to such Lender's
     Applicable  Percentage of the amount of Swing Line Loans then  outstanding.
     Such  request  shall be made in writing  (which  written  request  shall be
     deemed to be a Committed Loan Notice for purposes hereof) and in accordance
     with the  requirements  of SECTION 2.02,  without regard to the minimum and
     multiples  specified  therein for the principal  amount of Base Rate Loans,
     but subject to the unutilized portion of the Aggregate  Commitments and the
     conditions  set forth in SECTION 4.02.  The Swing Line Lender shall furnish
     the Borrower with a copy of the applicable  Committed Loan Notice  promptly

                                      S-40
<PAGE>

     after delivering such notice to the Administrative Agent. Each Lender shall
     make an amount equal to its Applicable  Percentage of the amount  specified
     in such  Committed  Loan Notice  available to the  Administrative  Agent in
     immediately available funds for the account of the Swing Line Lender at the
     Administrative Agent's Office not later than 1:00 p.m. on the day specified
     in such Committed Loan Notice,  whereupon,  subject to SECTION 2.04(C)(II),
     each Lender that so makes  funds  available  shall be deemed to have made a
     Base Rate Committed Loan to the Borrower in such amount. The Administrative
     Agent shall remit the funds so received to the Swing Line Lender.

          (ii) If for any  reason any Swing Line Loan  cannot be  refinanced  by
     such a Committed  Borrowing  in  accordance  with SECTION  2.04(C)(I),  the
     request for Base Rate Committed Loans submitted by the Swing Line Lender as
     set forth  herein  shall be deemed to be a request by the Swing Line Lender
     that each of the Lenders fund its risk  participation in the relevant Swing
     Line Loan and each  Lender's  payment to the  Administrative  Agent for the
     account of the Swing Line Lender  pursuant to SECTION  2.04(C)(I)  shall be
     deemed payment in respect of such participation.

          (iii) If any  Lender  fails to make  available  to the  Administrative
     Agent for the  account of the Swing Line  Lender any amount  required to be
     paid by such Lender  pursuant to the  foregoing  provisions of this SECTION
     2.04(C) by the time specified in SECTION 2.04(C)(I),  the Swing Line Lender
     shall  be  entitled  to  recover  from  such  Lender  (acting  through  the
     Administrative Agent), on demand, such amount with interest thereon for the
     period  from the date such  payment is  required  to the date on which such
     payment is  immediately  available  to the Swing Line  Lender at a rate per
     annum equal to the greater of the Federal Funds Rate and a rate  determined
     by the Swing Line  Lender in  accordance  with  banking  industry  rules on
     interbank compensation, plus any administrative, processing or similar fees
     customarily  charged  by the  Swing  Line  Lender  in  connection  with the
     foregoing.  If such  Lender  pays such amount  (with  interest  and fees as
     aforesaid),  the amount so paid shall  constitute  such Lender's  Committed
     Loan included in the relevant Committed  Borrowing or funded  participation
     in the relevant  Swing Line Loan, as the case may be. A certificate  of the
     Swing Line  Lender  submitted  to any Lender  (through  the  Administrative
     Agent) with  respect to any amounts  owing under this clause (iii) shall be
     conclusive absent manifest error.

          (iv) Each Lender's  obligation to make Committed  Loans or to purchase
     and fund risk  participations  in Swing Line Loans pursuant to this SECTION
     2.04(C)  shall be absolute and  unconditional  and shall not be affected by
     any  circumstance,  including  (A) any  setoff,  counterclaim,  recoupment,
     defense or other right  which such  Lender may have  against the Swing Line
     Lender, the Borrower or any other Person for any reason whatsoever, (B) the
     occurrence or continuance of a Default, or (C) any other occurrence,  event
     or  condition,  whether or not similar to any of the  foregoing;  PROVIDED,
     HOWEVER,  that each Lender's obligation to make Committed Loans pursuant to
     this  SECTION  2.04(C) is subject  to the  conditions  set forth in SECTION
     4.02.  No such funding of risk  participations  shall  relieve or otherwise
     impair the  obligation of the Borrower to repay Swing Line Loans,  together
     with interest as provided herein.

                                      S-41
<PAGE>

     (d) REPAYMENT OF PARTICIPATIONS.

          (i) At any time  after any  Lender  has  purchased  and  funded a risk
     participation  in a Swing Line Loan, if the Swing Line Lender  receives any
     payment on account of such  Swing  Line Loan,  the Swing Line  Lender  will
     distribute  to such Lender its  Applicable  Percentage  thereof in the same
     funds as those received by the Swing Line Lender.

          (ii) If any  payment  received  by the Swing Line Lender in respect of
     principal  or interest on any Swing Line Loan is required to be returned by
     the Swing Line Lender under any of the  circumstances  described in SECTION
     10.05 (including  pursuant to any settlement entered into by the Swing Line
     Lender in its  discretion),  each Lender shall pay to the Swing Line Lender
     its Applicable  Percentage thereof on demand of the  Administrative  Agent,
     plus interest  thereon from the date of such demand to the date such amount
     is  returned,  at a rate per annum  equal to the Federal  Funds  Rate.  The
     Administrative  Agent will make such  demand  upon the request of the Swing
     Line Lender. The obligations of the Lenders under this clause shall survive
     the  payment  in  full  of the  Obligations  and  the  termination  of this
     Agreement.

     (e) INTEREST FOR ACCOUNT OF SWING LINE LENDER.  The Swing Line Lender shall
be responsible  for invoicing the Borrower for interest on the Swing Line Loans.
Until  each  Lender  funds its Base Rate  Committed  Loan or risk  participation
pursuant to this SECTION 2.04 to refinance such Lender's  Applicable  Percentage
of any Swing Line Loan, interest in respect of such Applicable  Percentage shall
be solely for the account of the Swing Line Lender.

     (f)  PAYMENTS  DIRECTLY TO SWING LINE LENDER.  The Borrower  shall make all
payments of principal  and interest in respect of the Swing Line Loans  directly
to the Swing Line Lender.

     2.05. PREPAYMENTS.

     (a) The Borrower may, upon notice to the Administrative  Agent, at any time
or from  time to time  voluntarily  prepay  Committed  Loans in whole or in part
without  premium or penalty;  PROVIDED  that (i) such notice must be received by
the Administrative Agent not later than 11:00 a.m. (A) three Business Days prior
to any  date of  prepayment  of  Eurodollar  Rate  Loans  and (B) on the date of
prepayment of Base Rate Committed Loans;  (ii) any prepayment of Eurodollar Rate
Loans  shall be in a  principal  amount of  $2,000,000  or a whole  multiple  of
$500,000 in excess  thereof;  and (iii) any  prepayment  of Base Rate  Committed
Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000
in excess thereof or, in each case, if less, the entire principal amount thereof
then  outstanding.  Each such notice  shall  specify the date and amount of such
prepayment  and the Type(s) of Committed  Loans to be prepaid and, if Eurodollar
Rate  Loans  are to be  prepaid,  the  Interest  Period(s)  of such  Loans.  The
Administrative  Agent will  promptly  notify  each Lender of its receipt of each
such notice,  and of the amount of such Lender's  Applicable  Percentage of such
prepayment.  If such notice is given by the  Borrower,  the Borrower  shall make
such prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein.  Any prepayment of a Eurodollar Rate Loan
shall be accompanied  by all accrued  interest on the amount  prepaid,  together
with any  additional  amounts  required  pursuant  to  SECTION  3.05.  Each such

                                      S-42
<PAGE>

prepayment  shall be applied to the Committed Loans of the Lenders in accordance
with their respective Applicable Percentages.

     (b) The Borrower  may, upon notice to the Swing Line Lender (with a copy to
the Administrative  Agent), at any time or from time to time, voluntarily prepay
Swing Line Loans in whole or in part without  premium or penalty;  PROVIDED that
(i) such notice must be received by the Swing Line Lender and the Administrative
Agent not later than 1:00 p.m. on the date of the prepayment,  and (ii) any such
prepayment shall be in a minimum principal amount of $100,000.  Each such notice
shall specify the date and amount of such prepayment. If such notice is given by
the Borrower,  the Borrower  shall make such  prepayment  and the payment amount
specified in such notice shall be due and payable on the date specified therein.

     (c) If for any  reason  the  Total  Outstandings  at any  time  exceed  the
Aggregate  Commitments then in effect,  the Borrower shall promptly prepay Loans
and/or Cash  Collateralize  the L/C Obligations in an aggregate  amount equal to
such excess; PROVIDED,  HOWEVER, that the Borrower shall not be required to Cash
Collateralize the L/C Obligations  pursuant to this SECTION 2.05(C) unless after
the prepayment in full of the Loans the Total Outstandings  exceed the Aggregate
Commitments then in effect.

     2.06.  TERMINATION OR REDUCTION OF COMMITMENTS.  (a) The Borrower may, upon
notice to the Administrative Agent, terminate the Aggregate Commitments, or from
time to time permanently reduce the Aggregate Commitments; provided that (i) any
such notice shall be received by the  Administrative  Agent not later than 11:00
a.m. five Business Days prior to the date of termination or reduction,  (ii) any
such partial  reduction  shall be in an aggregate  amount of  $5,000,000  or any
whole  multiple of $1,000,000 in excess  thereof,  (iii) the Borrower  shall not
terminate or reduce the Aggregate  Commitments  if, after giving effect  thereto
and to any concurrent prepayments hereunder, the Total Outstandings would exceed
the Aggregate Commitments,  and (iv) if, after giving effect to any reduction of
the  Aggregate  Commitments,  the  Letter of Credit  Sublimit  or the Swing Line
Sublimit exceeds the amount of the Aggregate Commitments, such Sublimit shall be
automatically  reduced by the amount of such excess.  The  Administrative  Agent
will promptly  notify the Lenders of any such notice of termination or reduction
of the Aggregate  Commitments.  Any reduction of the Aggregate Commitments shall
be  applied  to the  Commitment  of  each  Lender  according  to its  Applicable
Percentage.  All fees accrued until the effective date of any termination of the
Aggregate Commitments shall be paid on the effective date of such termination.

     (b)  DISPOSITIONS.  If the Borrower or any Subsidiary makes any Disposition
other than  Dispositions  permitted by SECTION 7.05 the Loan shall be repaid and
the  Aggregate  Commitments  reduced  in the  amount  of the Net  Cash  Proceeds
(determined  as of the date of such  Disposition,  whether  or not such Net Cash
Proceeds  are then  received  by the  Borrower  or such  Subsidiary)  from  such
Disposition.  Nothing in this SECTION 2.06(B) shall permit any Disposition  that
is not permitted by SECTION 7.05.

     (c)  EXTRAORDINARY  RECEIPTS.  Upon the receipt by any Loan Party or any of
its Subsidiaries of any  Extraordinary  Receipts,  the Loans shall be repaid and
Aggregate  Commitments  shall  be  reduced  by an  amount  equal to 100% of such
Extraordinary  Receipts,  net of any actual expenses incurred in collecting such
Extraordinary  Receipts;  PROVIDED,  that  in the  case  of  insurance  proceeds

                                      S-43
<PAGE>

received in connection  with a Casualty Event with respect to Property having an
aggregate market value less than $1,500,000 (or such larger amount approved,  in
writing,  by the  Administrative  Agent), so long as, at the time of receipt and
use of such insurance  proceeds,  no Event of Default shall have occurred and be
continuing,  the Loan Parties shall be entitled to use such  insurance  proceeds
(in an amount not in excess of $1,500,000  (or such larger amount  approved,  in
writing,  by the  Administrative  Agent))  to repair  or  replace  the  Property
affected by such Casualty Event, PROVIDED, further, that (A) until so used, such
insurance  proceeds  shall  be,  if so  directed  by the  Administrative  Agent,
deposited into a cash  collateral  account (and when so deposited such insurance
proceeds shall constitute  Collateral for the Obligations  then  outstanding) or
applied to repay the Loans,  (B) such  insurance  proceeds may be used solely to
repair or replace the Property that was the subject of such Casualty  Event with
other  Property of the same type unless  otherwise  agreed,  in writing,  by the
Administrative Agent, (C) such insurance proceeds must be used and such Property
must be repaired or replaced  within 180 days after the date of receipt  thereof
unless otherwise agreed, in writing,  by the Administrative  Agent, and (D) upon
the occurrence  and during the  continuance of an Event of Default or after such
180  day  period  or  any  extension  thereof  approved,   in  writing,  by  the
Administrative  Agent shall have expired,  such  insurance  proceeds,  if not so
used,  shall be applied to the prepayment of Loans and cover for L/C Obligations
as provided in this subsection 2.06(c).

     (d)  ADDITIONAL  INDEBTEDNESS.  If the  Borrower or any  Subsidiary  incurs
Indebtedness,  other than Additional Subordinated  Indebtedness and Indebtedness
permitted to be incurred  pursuant to SECTION 7.03 (other than SECTION 7.03(K)),
the Loans shall be repaid and the  Aggregate  Commitments  shall be  permanently
reduced  by the  amount of the Net Cash  Proceeds  from the  incurrence  of such
Indebtedness. Nothing in this SECTION 2.06(D) shall permit the incurrence of any
Indebtedness that is not permitted by SECTION 7.03.

     (e)  ISSUANCE OF  ADDITIONAL  EQUITY  INTERESTS.  Upon the  issuance by the
Borrower or any Subsidiary of any  additional  Equity  Interests,  if the Senior
Leverage Ratio as of the fiscal quarter most recently then ended,  calculated on
a pro forma basis after giving effect to such equity issuance is greater than or
equal to 4.0 to 1, the Loans shall be repaid and the Aggregate Commitments shall
be  reduced  by an  amount  equal  to 50% of the Net  Cash  Proceeds  from  such
issuance.

     2.07. REPAYMENT OF LOANS.

     (a) The  Borrower  shall  repay to the  Lenders  on the  Maturity  Date the
aggregate principal amount of Committed Loans outstanding on such date.

     (b) The  Borrower  shall repay each Swing Line Loan on the earlier to occur
of (i) the date ten Business  Days after such Loan is made and (ii) the Maturity
Date.

     (c) CURRENCY MATTERS.

          (i) Dollars are the currency of account and payment for each and every
     sum at any time due from the Loan  Parties  hereunder.  No  payment  to the
     Administrative  Agent,  any  Lender or the L/C  Issuer  (whether  under any
     judgment or court order or otherwise)  shall  discharge  the  obligation or

                                      S-44
<PAGE>

     liability   in  respect  of  which  it  was  made   unless  and  until  the
     Administrative  Agent or such Lender shall have received payment in full of
     the Dollar Equivalent of the amount of such obligation or liability, and to
     the extent that the amount of any such payment shall, on actual  conversion
     into  Dollars,  fall  short  of such  obligation  or  liability  actual  or
     contingent  expressed in Dollars,  the Borrower  shall  indemnify  and hold
     harmless the  Administrative  Agent, the L/C Issuer or such Lender,  as the
     case may be, with respect to the amount of the shortfall.

          (ii)  Not  later  than  1:00  p.m.  on the last  Business  Day of each
     calendar  month  (the  "CALCULATION  DATE")  or  such  other  date  as  the
     Administrative  Agent may from  time to time  specify,  the  Administrative
     Agent shall  determine the Dollar  Equivalent of the L/C  Obligations as of
     such date. The Dollar  Equivalent so determined  shall become  effective on
     the first Business Day immediately  following such  determination (a "RESET
     DATE") and shall remain effective until the next succeeding Reset Date.

          (iii) If, on any Reset Date,  the Dollar  Equivalent  of the aggregate
     outstanding  amount  of all  Loans  and the  L/C  Obligations  exceeds  the
     Aggregate Commitments, then the Borrower shall repay or prepay the Loans in
     accordance with this Agreement in an aggregate  principal amount such that,
     after giving effect thereto, the aggregate outstanding amount (expressed in
     Dollars)  of all  Loans  PLUS the L/C  Obligations  no longer  exceeds  the
     Aggregate Commitments.

          (iv) If on any Reset  Date,  the Dollar  Equivalent  of the Foreign LC
     Exposure  exceeds  $10,000,000,  then the Borrower shall  immediately  upon
     demand provide cash collateral to the Administrative Agent in the amount of
     such excess.

     2.08. INTEREST.

     (a) Subject to the provisions of subsection (b) below,  (i) each Eurodollar
Rate Loan shall bear interest on the  outstanding  principal  amount thereof for
each Interest  Period at a rate per annum equal to the Eurodollar  Rate for such
Interest  Period PLUS the  Applicable  Rate;  (ii) each Base Rate Committed Loan
shall  bear  interest  on the  outstanding  principal  amount  thereof  from the
applicable  borrowing  date at a rate per annum  equal to the Base Rate PLUS the
Applicable  Rate;  and (iii) each Swing  Line Loan  shall bear  interest  on the
outstanding  principal  amount thereof from the  applicable  borrowing date at a
rate per annum equal to the Base Rate PLUS the Applicable Rate.

     (b)  (i) If any  amount  of  principal  of any  Loan is not paid  when due,
whether at stated  maturity,  by  acceleration  or otherwise,  such amount shall
thereafter  bear interest at a fluctuating  interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.

          (ii) If any amount  (other than  principal of any Loan) payable by the
     Borrower  under any Loan  Document is not paid when due,  whether at stated
     maturity,  by  acceleration  or  otherwise,  then upon the  request  of the
     Required  Lenders,   such  amount  shall  thereafter  bear  interest  at  a
     fluctuating  interest rate per annum at all times equal to the Default Rate
     to the fullest extent permitted by applicable Laws.

                                      S-45
<PAGE>

          (iii) Upon the  request of the  Required  Lenders,  while any Event of
     Default exists,  the Borrower shall pay interest on the principal amount of
     all outstanding  Obligations  hereunder at a fluctuating  interest rate per
     annum  at all  times  equal  to the  Default  Rate  to the  fullest  extent
     permitted by applicable Laws.

          (iv)  Accrued  and  unpaid  interest  on past due  amounts  (including
     interest on past due interest) shall be due and payable upon demand.

     (c)  Interest  on each Loan  shall be due and  payable  in  arrears on each
Interest  Payment  Date  applicable  thereto  and at such other  times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the  terms  hereof  before  and  after  judgment,   and  before  and  after  the
commencement of any proceeding under any Debtor Relief Law.

     2.09.  FEES. In addition to certain fees described in  subsections  (i) and
(j) of SECTION 2.03:

     (a) COMMITMENT FEE. The Borrower shall pay to the Administrative  Agent for
the account of each  Lender in  accordance  with its  Applicable  Percentage,  a
commitment  fee equal to the  Applicable  Rate TIMES the actual  daily amount by
which the Aggregate  Commitments exceed the sum of (i) the Outstanding Amount of
Committed Loans (other than Swing Line Loans) and (ii) the Outstanding Amount of
L/C  Obligations.  The  commitment  fee shall  accrue at all  times  during  the
Availability  Period,  including  at any time  during  which  one or more of the
conditions  in ARTICLE IV is not met, and shall be due and payable  quarterly in
arrears on the 15th day of each January, April, July and October, or if the 15th
day of such month is not a Business  Day, on the next  Business Day  thereafter,
commencing  with the first such date to occur after the Closing Date, and on the
last day of the  Availability  Period.  The  commitment  fee shall be calculated
quarterly in arrears,  and if there is any change in the Applicable  Rate during
any quarter,  the actual daily  amount shall be computed and  multiplied  by the
Applicable  Rate  separately  for each  period  during  such  quarter  that such
Applicable Rate was in effect.

     (b)  OTHER  FEES.  (i)  The  Borrower  shall  pay to the  Arranger  and the
Administrative  Agent for their own respective  accounts fees in the amounts and
at the times  specified in the Fee Letter.  Such fees shall be fully earned when
paid and shall not be refundable for any reason whatsoever.

          (ii) The  Borrower  shall pay to the  Lenders  such fees as shall have
     been  separately  agreed upon in writing in the amounts and at the times so
     specified.  Such  fees  shall be fully  earned  when  paid and shall not be
     refundable for any reason whatsoever.

     2.10.  COMPUTATION OF INTEREST AND FEES. All  computations  of interest for
Base Rate Loans when the Base Rate is  determined  by Bank of  America's  "prime
rate"  shall be made on the basis of a year of 365 or 366 days,  as the case may
be, and actual days elapsed.  All other  computations of fees and interest shall
be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest,  as applicable,  being paid than if computed on the basis
of a 365-day year).  Interest shall accrue on each Loan for the day on which the
Loan is made,  and shall not accrue on a Loan, or any portion  thereof,  for the

                                      S-46
<PAGE>

day on which the Loan or such  portion is paid,  PROVIDED  that any Loan that is
repaid on the same day on which it is made  shall,  subject to SECTION  2.12(A),
bear interest for one day. Each determination by the Administrative  Agent of an
interest rate or fee hereunder shall be conclusive and binding for all purposes,
absent manifest error.

     2.11. EVIDENCE OF DEBT.

     (a) The Credit  Extensions made by each Lender shall be evidenced by one or
more  accounts or records  maintained  by such Lender and by the  Administrative
Agent in the ordinary course of business.  The accounts or records maintained by
the  Administrative  Agent and each Lender shall be conclusive  absent  manifest
error of the amount of the Credit Extensions made by the Lenders to the Borrower
and the interest and payments thereon.  Any failure to so record or any error in
doing so shall not,  however,  limit or otherwise  affect the  obligation of the
Borrower  hereunder to pay any amount owing with respect to the Obligations.  In
the event of any conflict  between the accounts  and records  maintained  by any
Lender and the  accounts and records of the  Administrative  Agent in respect of
such matters, the accounts and records of the Administrative Agent shall control
in the absence of manifest  error.  Upon the request of any Lender made  through
the Administrative  Agent, the Borrower shall execute and deliver to such Lender
(through the  Administrative  Agent) a Note,  which shall evidence such Lender's
Loans in addition to such accounts or records.  Each Lender may attach schedules
to its Note and  endorse  thereon  the date,  Type (if  applicable),  amount and
maturity of its Loans and payments with respect thereto.

     (b) In addition to the accounts and records  referred to in subsection (a),
each Lender and the  Administrative  Agent shall maintain in accordance with its
usual  practice  accounts or records  evidencing the purchases and sales by such
Lender of participations in Letters of Credit and Swing Line Loans. In the event
of  any  conflict   between  the  accounts   and  records   maintained   by  the
Administrative  Agent and the  accounts  and records of any Lender in respect of
such matters, the accounts and records of the Administrative Agent shall control
in the absence of manifest error.

     2.12. PAYMENTS GENERALLY; ADMINISTRATIVE AGENT'S CLAWBACK.

     (a) GENERAL.  All payments to be made by the Borrower shall be made without
condition or deduction  for any  counterclaim,  defense,  recoupment  or setoff.
Except as  otherwise  expressly  provided  herein,  all payments by the Borrower
hereunder  shall be made to the  Administrative  Agent,  for the  account of the
respective Lenders to which such payment is owed, at the Administrative  Agent's
Office in Dollars and in immediately available funds not later than 2:00 p.m. on
the date specified herein. The Administrative  Agent will promptly distribute to
each Lender its  Applicable  Percentage (or other  applicable  share as provided
herein) of such  payment  in like funds as  received  by wire  transfer  to such
Lender's Lending Office. All payments received by the Administrative Agent after
2:00 p.m. shall be deemed received on the next  succeeding  Business Day and any
applicable  interest or fee shall continue to accrue.  If any payment to be made
by the Borrower shall come due on a day other than a Business Day, payment shall
be made on the next following  Business Day, and such extension of time shall be
reflected in computing interest or fees, as the case may be.

                                      S-47
<PAGE>

     (b) (i) FUNDING BY LENDERS; PRESUMPTION BY ADMINISTRATIVE AGENT. Unless the
Administrative  Agent  shall have  received  notice  from a Lender  prior to the
proposed  date of any Committed  Borrowing of Eurodollar  Rate Loans (or, in the
case of any Committed  Borrowing of Base Rate Loans,  prior to 12:00 noon on the
date of such  Committed  Borrowing)  that such Lender will not make available to
the Administrative  Agent such Lender's share of such Committed  Borrowing,  the
Administrative  Agent may assume that such Lender has made such share  available
on such date in  accordance  with  SECTION  2.02 (or, in the case of a Committed
Borrowing of Base Rate Loans,  that such Lender has made such share available in
accordance  with and at the time  required by SECTION 2.02) and may, in reliance
upon such assumption,  make available to the Borrower a corresponding amount. In
such  event,  if a  Lender  has not in fact  made its  share  of the  applicable
Committed Borrowing  available to the Administrative  Agent, then the applicable
Lender  and the  Borrower  severally  agree to pay to the  Administrative  Agent
forthwith on demand such  corresponding  amount in immediately  available  funds
with interest  thereon,  for each day from and including the date such amount is
made  available  to the  Borrower  to but  excluding  the date of payment to the
Administrative Agent, at (A) in the case of a payment to be made by such Lender,
the  greater  of  the  Federal   Funds  Rate  and  a  rate   determined  by  the
Administrative  Agent in  accordance  with banking  industry  rules on interbank
compensation,  plus any  administrative,  processing or similar fees customarily
charged by the Administrative Agent in connection with the foregoing, and (B) in
the case of a payment to be made by the Borrower,  the interest rate  applicable
to Base Rate Loans.  If the Borrower and such Lender shall pay such  interest to
the   Administrative   Agent  for  the  same  or  an  overlapping   period,  the
Administrative  Agent shall  promptly  remit to the  Borrower the amount of such
interest paid by the Borrower for such period.  If such Lender pays its share of
the applicable Committed Borrowing to the Administrative  Agent, then the amount
so paid shall constitute such Lender's Committed Loan included in such Committed
Borrowing.  Any payment by the Borrower shall be without  prejudice to any claim
the  Borrower  may have  against a Lender  that shall  have  failed to make such
payment to the Administrative Agent.

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

     A notice of the  Administrative  Agent to any Lender or the  Borrower  with
respect  to any amount  owing  under this  subsection  (b) shall be  conclusive,
absent manifest error.

                                      S-48
<PAGE>

     (c) FAILURE TO SATISFY CONDITIONS PRECEDENT.  If any Lender makes available
to the  Administrative  Agent  funds  for any Loan to be made by such  Lender as
provided in the foregoing  provisions of this ARTICLE II, and such funds are not
made  available  to  the  Borrower  by  the  Administrative  Agent  because  the
conditions to the  applicable  Credit  Extension set forth in ARTICLE IV are not
satisfied or waived in  accordance  with the terms  hereof,  the  Administrative
Agent shall  return such funds (in like funds as received  from such  Lender) to
such Lender, without interest.

     (d)  OBLIGATIONS  OF  LENDERS  SEVERAL.  The  obligations  of  the  Lenders
hereunder to make Committed Loans, to fund  participations  in Letters of Credit
and Swing Line Loans and to make  payments  pursuant  to  SECTION  10.04(C)  are
several and not joint.  The failure of any Lender to make any Committed Loan, to
fund any such participation or to make any payment under SECTION 10.04(C) on any
date required  hereunder shall not relieve any other Lender of its corresponding
obligation  to do so on such date,  and no Lender shall be  responsible  for the
failure of any other  Lender to so make its  Committed  Loan,  to  purchase  its
participation or to make its payment under SECTION 10.04(C).

     (e) FUNDING  SOURCE.  Nothing herein shall be deemed to obligate any Lender
to  obtain  the  funds  for any Loan in any  particular  place or  manner  or to
constitute  a  representation  by any Lender that it has obtained or will obtain
the funds for any Loan in any particular place or manner.

     2.13.  SHARING OF PAYMENTS BY LENDERS.  If any Lender shall,  by exercising
any right of setoff or counterclaim  or otherwise,  obtain payment in respect of
any  principal of or interest on any of the  Committed  Loans made by it, or the
participations in L/C Obligations or in Swing Line Loans held by it resulting in
such Lender's  receiving payment of a proportion of the aggregate amount of such
Committed Loans or participations  and accrued interest thereon greater than its
pro rata share  thereof as  provided  herein,  then the  Lender  receiving  such
greater proportion shall (a) notify the  Administrative  Agent of such fact, and
(b) purchase (for cash at face value)  participations in the Committed Loans and
subparticipations  in L/C Obligations and Swing Line Loans of the other Lenders,
or make such other adjustments as shall be equitable, so that the benefit of all
such  payments  shall be shared by the Lenders  ratably in  accordance  with the
aggregate  amount of  principal  of and  accrued  interest  on their  respective
Committed Loans and other amounts owing them, provided that:

          (i) if any such participations or subparticipations  are purchased and
     all or any portion of the payment  giving rise thereto is  recovered,  such
     participations  or  subparticipations  shall be rescinded  and the purchase
     price restored to the extent of such recovery, without interest; and

          (ii) the provisions of this Section shall not be construed to apply to
     (x) any payment made by the Borrower pursuant to and in accordance with the
     express terms of this Agreement or (y) any payment  obtained by a Lender as
     consideration  for the assignment of or sale of a  participation  in any of
     its Committed Loans or  subparticipations  in L/C Obligations or Swing Line
     Loans to any  assignee or  participant,  other than to the  Borrower or any
     Subsidiary  thereof  (as to which  the  provisions  of this  Section  shall
     apply).

                                      S-49
<PAGE>

     Each Loan Party consents to the foregoing and agrees,  to the extent it may
effectively  do  so  under   applicable   law,  that  any  Lender   acquiring  a
participation  pursuant to the foregoing  arrangements may exercise against such
Loan Party rights of setoff and counterclaim with respect to such  participation
as fully as if such  Lender  were a direct  creditor  of such Loan  Party in the
amount of such participation.

     2.14. INCREASE IN COMMITMENTS.

     (a) REQUEST FOR INCREASE.  Provided there exists no Default, upon notice to
the Administrative Agent (which shall promptly notify the Lenders), the Borrower
may on a one-time basis, request an increase in the Aggregate  Commitments by an
amount not  exceeding (a) in the event that the Senior Notes have been repaid in
full or will be repaid in full contemporaneously with such increase, $50,000,000
or (b) in the event  that any  Senior  Notes  remain  outstanding,  $25,000,000;
PROVIDED that any such request for an increase  shall be in a minimum  amount of
$5,000,000.  At the time of sending such notice,  the Borrower (in  consultation
with the  Administrative  Agent) shall specify the time period within which each
Lender  is  requested  to  respond  (which  shall in no  event be less  than ten
Business Days from the date of delivery of such notice to the Lenders).

     (b)  LENDER   ELECTIONS   TO   INCREASE.   Each  Lender  shall  notify  the
Administrative  Agent  within  such  time  period  whether  or not it  agrees to
increase its Commitment and, if so, whether by an amount equal to, greater than,
or less than its Applicable  Percentage of such requested  increase.  Any Lender
not  responding  within  such time  period  shall be deemed to have  declined to
increase its Commitment.

     (c)  NOTIFICATION  BY  ADMINISTRATIVE   AGENT;   ADDITIONAL  LENDERS.   The
Administrative  Agent shall  notify the Borrower and each Lender of the Lenders'
responses  to each  request  made  hereunder.  To achieve  the full  amount of a
requested increase and subject to the approval of the Administrative  Agent, the
L/C Issuer and the Swing Line Lender (which  approvals shall not be unreasonably
withheld),  the Borrower may also invite additional Eligible Assignees to become
Lenders  pursuant to a joinder  agreement in form and substance  satisfactory to
the  Administrative  Agent and its counsel;  PROVIDED  THAT the  opportunity  to
increase its  Commitment is first offered to each existing  Lender in accordance
with this SECTION 2.14.

     (d)  EFFECTIVE  DATE AND  ALLOCATIONS.  If the  Aggregate  Commitments  are
increased in accordance  with this  Section,  the  Administrative  Agent and the
Borrower shall determine the effective date (the "INCREASE  EFFECTIVE DATE") and
the final allocation of such increase.  The Administrative  Agent shall promptly
notify the Borrower and the Lenders of the final allocation of such increase and
the Increase Effective Date.

     (e) CONDITIONS TO  EFFECTIVENESS OF INCREASE.  As a condition  precedent to
such  increase,  the  Borrower  shall  deliver  to the  Administrative  Agent  a
certificate  of each Loan  Party  dated as of the  Increase  Effective  Date (in
sufficient copies for each Lender) signed by a Responsible  Officer of such Loan
Party (i)  certifying and attaching the  resolutions  adopted by such Loan Party
approving or  consenting  to such  increase,  (ii) in the case of the  Borrower,
certifying  that,  before  and after  giving  effect to such  increase,  (A) the
representations  and  warranties  contained  in  ARTICLE  V and the  other  Loan
Documents are true and correct on and as of the Increase  Effective Date, except

                                      S-50
<PAGE>

to the extent that such representations and warranties  specifically refer to an
earlier  date,  in which case they are true and correct as of such earlier date,
and except that for  purposes of this  SECTION  2.14,  the  representations  and
warranties  contained in subsections (a) and (b) of SECTION 5.05 shall be deemed
to refer to the most  recent  statements  furnished  pursuant to clauses (a) and
(b),  respectively,  of SECTION 6.01, and (B) no Default exists and (iii) in the
case of a request  for an  increase of the  Aggregate  Commitments  in an amount
greater than  $25,000,000,  evidence of repayment in full of the Senior Notes in
form and substance  satisfactory to the Administrative Agent. The Borrower shall
prepay any Committed Loans  outstanding on the Increase  Effective Date (and pay
any  additional  amounts  required  pursuant  to  SECTION  3.05)  to the  extent
necessary  to keep the  outstanding  Committed  Loans  ratable  with any revised
Applicable  Percentages  arising from any nonratable increase in the Commitments
under this Section.

     (f) CONFLICTING PROVISIONS.  This Section shall supersede any provisions in
SECTION 2.13 or 10.01 to the contrary.

     2.15. COLLATERAL SECURITY.  The Obligations shall be secured by a perfected
first priority  security  interest  (subject only to Liens  permitted by SECTION
7.01 entitled to priority under  applicable law) in (i) all of the assets of the
Loan  Parties,  whether  now owned or  hereafter  acquired,  including,  without
limitation all real,  leasehold and personal  property of each Loan Party,  (ii)
all Equity  Interests of all  first-tier  Subsidiaries  of the Borrower and each
Guarantor;  PROVIDED  that,  with respect to Foreign  Subsidiaries,  such equity
pledge shall be limited to 65% of the capital  stock of such Foreign  Subsidiary
to the extent the pledge of any  greater  percentage  would  result in  material
adverse  tax  consequences  to any Loan  Party,  (iii) all  present  and  future
intercompany  debt of the Borrower and each  Guarantor and (iv) all proceeds and
products of the property and assets described in (i), (ii) and (iii) above.

                                  ARTICLE III.
                     TAXES, YIELD PROTECTION AND ILLEGALITY

     3.01. TAXES.

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

     (b) PAYMENT OF OTHER TAXES BY THE BORROWER. Without limiting the provisions
of subsection  (a) above,  the Borrower  shall timely pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.

                                      S-51
<PAGE>

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

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

     (e) STATUS OF LENDERS.  Any Foreign Lender that is entitled to an exemption
from or reduction of withholding tax under the law of the  jurisdiction in which
the  Borrower  is  resident  for tax  purposes,  or any  treaty  to  which  such
jurisdiction is a party,  with respect to payments  hereunder or under any other
Loan Document shall deliver to the Borrower  (with a copy to the  Administrative
Agent),  at the  time  or  times  prescribed  by  applicable  law or  reasonably
requested by the Borrower or the  Administrative  Agent, such properly completed
and executed  documentation  prescribed  by  applicable  law as will permit such
payments to be made without withholding or at a reduced rate of withholding.  In
addition,  any Lender, if requested by the Borrower or the Administrative Agent,
shall  deliver  such  other  documentation   prescribed  by  applicable  law  or
reasonably  requested by the Borrower or the Administrative Agent as will enable
the Borrower or the Administrative Agent to determine whether or not such Lender
is subject to backup withholding or information reporting requirements.

     Without  limiting the  generality of the  foregoing,  in the event that the
Borrower is resident for tax purposes in the United  States,  any Foreign Lender
shall  deliver to the Borrower and the  Administrative  Agent (in such number of
copies as shall be requested by the  recipient) on or prior to the date on which
such Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter  upon the request of the Borrower or the  Administrative  Agent,  but
only if such  Foreign  Lender is legally  entitled to do so),  whichever  of the
following is applicable:

          (i) duly  completed  copies of Internal  Revenue  Service  Form W-8BEN
     claiming  eligibility  for  benefits  of an income  tax treaty to which the
     United States is a party,

          (ii) duly completed copies of Internal Revenue Service Form W-8ECI,

          (iii) in the case of a Foreign  Lender  claiming  the  benefits of the
     exemption for portfolio  interest  under section  881(c) of the Code, (x) a
     certificate  to the  effect  that such  Foreign  Lender is not (A) a "bank"
     within the meaning of section  881(c)(3)(A)  of the Code, (B) a "10 percent

                                      S-52
<PAGE>

     shareholder" of the Borrower within the meaning of section  881(c)(3)(B) of
     the Code, or (C) a "controlled  foreign  corporation"  described in section
     881(c)(3)(C) of the Code and (y) duly completed  copies of Internal Revenue
     Service Form W-8BEN, or

          (iv) any  other  form  prescribed  by  applicable  law as a basis  for
     claiming exemption from or a reduction in United States Federal withholding
     tax duly completed together with such supplementary documentation as may be
     prescribed  by  applicable  law to permit the  Borrower  to  determine  the
     withholding or deduction required to be made.

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

     3.02.  ILLEGALITY.  If any  Lender  determines  that  any Law  has  made it
unlawful,  or that any Governmental  Authority has asserted that it is unlawful,
for any  Lender  or its  applicable  Lending  Office to make,  maintain  or fund
Eurodollar  Rate Loans,  or to determine or charge interest rates based upon the
Eurodollar Rate, or any Governmental Authority has imposed material restrictions
on the  authority  of such Lender to purchase or sell,  or to take  deposits of,
Dollars in the London interbank  market,  then, on notice thereof by such Lender
to the Borrower through the Administrative  Agent, any obligation of such Lender
to make or  continue  Eurodollar  Rate Loans or to convert  Base Rate  Committed
Loans to Eurodollar Rate Loans shall be suspended until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to such
determination no longer exist. Upon receipt of such notice,  the Borrower shall,
upon demand from such Lender (with a copy to the Administrative  Agent),  prepay
or, if applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate
Loans,  either on the last day of the Interest Period  therefor,  if such Lender
may lawfully  continue to maintain  such  Eurodollar  Rate Loans to such day, or
immediately,  if  such  Lender  may  not  lawfully  continue  to  maintain  such
Eurodollar  Rate Loans.  Upon any such  prepayment or  conversion,  the Borrower
shall also pay accrued interest on the amount so prepaid or converted.

                                      S-53
<PAGE>

     3.03.  INABILITY TO DETERMINE RATES. If the Required Lenders determine that
for any reason in  connection  with any request for a Eurodollar  Rate Loan or a
conversion  to or  continuation  thereof that (a) Dollar  deposits are not being
offered to banks in the London  interbank  eurodollar  market for the applicable
amount and  Interest  Period of such  Eurodollar  Rate Loan,  (b)  adequate  and
reasonable  means do not  exist  for  determining  the  Eurodollar  Rate for any
requested  Interest Period with respect to a proposed  Eurodollar Rate Loan , or
(c) the  Eurodollar  Rate for any  requested  Interest  Period with respect to a
proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost to
such Lenders of funding such Loan,  the  Administrative  Agent will  promptly so
notify the Borrower and each Lender.  Thereafter,  the obligation of the Lenders
to make  or  maintain  Eurodollar  Rate  Loans  shall  be  suspended  until  the
Administrative Agent (upon the instruction of the Required Lenders) revokes such
notice. Upon receipt of such notice, the Borrower may revoke any pending request
for a Borrowing of,  conversion to or  continuation of Eurodollar Rate Loans or,
failing that, will be deemed to have converted such request into a request for a
Committed Borrowing of Base Rate Loans in the amount specified therein.

     3.04. INCREASED COSTs; RESERVES ON EURODOLLAR RATE LOANS.

     (a) INCREASED COSTS GENERALLY. If any Change in Law shall:

          (i) impose,  modify or deem applicable any reserve,  special  deposit,
     compulsory loan, insurance charge or similar requirement against assets of,
     deposits with or for the account of, or credit  extended or participated in
     by, any Lender  (except any  reserve  requirement  contemplated  by SECTION
     3.04(E)) or the L/C Issuer;

          (ii)  subject  any  Lender  or the L/C  Issuer  to any tax of any kind
     whatsoever  with  respect to this  Agreement,  any  Letter of  Credit,  any
     participation in a Letter of Credit or any Eurodollar Rate Loan made by it,
     or change  the basis of  taxation  of  payments  to such  Lender or the L/C
     Issuer in respect  thereof  (except  for  Indemnified  Taxes or Other Taxes
     covered by SECTION  3.01 and the  imposition  of, or any change in the rate
     of, any Excluded Tax payable by such Lender or the L/C Issuer); or

          (iii)  impose on any Lender or the L/C Issuer or the London  interbank
     market any other  condition,  cost or expense  affecting  this Agreement or
     Eurodollar  Rate  Loans  made by such  Lender  or any  Letter  of Credit or
     participation therein;

     and the result of any of the  foregoing  shall be to  increase  the cost to
such Lender of making or maintaining any Eurodollar Rate Loan (or of maintaining
its obligation to make any such Loan), or to increase the cost to such Lender or
the L/C Issuer of participating  in, issuing or maintaining any Letter of Credit
(or of  maintaining  its  obligation to participate in or to issue any Letter of
Credit),  or to reduce  the amount of any sum  received  or  receivable  by such
Lender or the L/C Issuer hereunder (whether of principal,  interest or any other
amount) then,  upon request of such Lender or the L/C Issuer,  the Borrower will
pay to such Lender or the L/C Issuer, as the case may be, such additional amount
or amounts as will compensate such Lender or the L/C Issuer, as the case may be,
for such additional costs incurred or reduction suffered.

                                      S-54
<PAGE>

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

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

     (d) DELAY IN  REQUESTS.  Failure  or delay on the part of any Lender or the
L/C Issuer to demand compensation  pursuant to the foregoing  provisions of this
Section shall not constitute a waiver of such Lender's or the L/C Issuer's right
to demand such compensation, PROVIDED that the Borrower shall not be required to
compensate a Lender or the L/C Issuer  pursuant to the  foregoing  provisions of
this Section for any increased  costs incurred or reductions  suffered more than
nine months  prior to the date that such  Lender or the L/C Issuer,  as the case
may be, notifies the Borrower of the Change in Law giving rise to such increased
costs or reductions and of such Lender's or the L/C Issuer's  intention to claim
compensation  therefor  (except  that,  if the Change in Law giving rise to such
increased  costs  or  reductions  is  retroactive,  then the  nine-month  period
referred to above shall be extended to include the period of retroactive  effect
thereof).

     (e)  RESERVES ON  EURODOLLAR  RATE LOANS.  The  Borrower  shall pay to each
Lender,  as long as such Lender  shall be required  to  maintain  reserves  with
respect to liabilities or assets consisting of or including  Eurocurrency  funds
or deposits (currently known as "Eurocurrency liabilities"), additional interest
on the unpaid  principal amount of each Eurodollar Rate Loan equal to the actual
costs of such reserves  allocated to such Loan by such Lender (as  determined by
such Lender in good faith, which determination shall be conclusive), which shall
be due and  payable  on each date on which  interest  is  payable  on such Loan,
PROVIDED the Borrower shall have received at least 10 days' prior notice (with a
copy to the Administrative  Agent) of such additional interest from such Lender.
If a Lender fails to give notice 10 days prior to the relevant  Interest Payment
Date, such additional  interest shall be due and payable 10 days from receipt of
such notice.

                                      S-55
<PAGE>

     3.05.  COMPENSATION  FOR LOSSES.  Upon demand of any Lender (with a copy to
the  Administrative  Agent)  from  time to time,  the  Borrower  shall  promptly
compensate  such Lender for and hold such Lender harmless from any loss, cost or
expense incurred by it as a result of:

     (a) any continuation,  conversion,  payment or prepayment of any Loan other
than a Base Rate Loan on a day other  than the last day of the  Interest  Period
for  such  Loan  (whether  voluntary,   mandatory,   automatic,   by  reason  of
acceleration, or otherwise);

     (b) any  failure by the  Borrower  (for a reason  other than the failure of
such  Lender to make a Loan) to prepay,  borrow,  continue  or convert  any Loan
other  than a Base  Rate  Loan on the  date  or in the  amount  notified  by the
Borrower; or

     (c) any  assignment of a Eurodollar  Rate Loan on a day other than the last
day of the  Interest  Period  therefor as a result of a request by the  Borrower
pursuant to SECTION 10.13;

     including any loss of anticipated  profits and any loss or expense  arising
from the  liquidation or  reemployment  of funds obtained by it to maintain such
Loan or from fees payable to terminate  the deposits  from which such funds were
obtained. The Borrower shall also pay any customary  administrative fees charged
by such Lender in connection with the foregoing.

     For purposes of calculating  amounts payable by the Borrower to the Lenders
under  this  SECTION  3.05,  each  Lender  shall be deemed to have  funded  each
Eurodollar  Rate  Loan  made by it at the  Eurodollar  Rate for  such  Loan by a
matching  deposit or other borrowing in the London interbank  eurodollar  market
for a  comparable  amount  and for a  comparable  period,  whether  or not  such
Eurodollar Rate Loan was in fact so funded.

     3.06. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS.

     (a)  DESIGNATION  OF A DIFFERENT  LENDING  OFFICE.  If any Lender  requests
compensation  under  SECTION  3.04,  or the  Borrower  is  required  to pay  any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to SECTION 3.01, or if any Lender gives a notice pursuant to
SECTION  3.02,  then such Lender  shall use  reasonable  efforts to  designate a
different Lending Office for funding or booking its Loans hereunder or to assign
its rights and  obligations  hereunder  to another of its  offices,  branches or
affiliates,  if, in the judgment of such Lender,  such designation or assignment
(i) would eliminate or reduce amounts payable  pursuant to SECTION 3.01 or 3.04,
as the case may be, in the future, or eliminate the need for the notice pursuant
to SECTION 3.02, as  applicable,  and (ii) in each case,  would not subject such
Lender  to  any  unreimbursed  cost  or  expense  and  would  not  otherwise  be
disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable
costs  and  expenses  incurred  by  any  Lender  in  connection  with  any  such
designation or assignment.

     (b)  REPLACEMENT  OF LENDERS.  If any Lender  requests  compensation  under
SECTION 3.04, or if the Borrower is required to pay any additional amount to any
Lender or any  Governmental  Authority for the account of any Lender pursuant to
SECTION 3.01,  the Borrower may replace such Lender in  accordance  with SECTION
10.13.

                                      S-56
<PAGE>

     3.07.  SURVIVAL.  All of the Borrower's  obligations under this ARTICLE III
shall  survive  termination  of the Aggregate  Commitments  and repayment of all
other Obligations hereunder.

                                  ARTICLE IV.
                    CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

     4.01.  CONDITIONS OF INITIAL  CREDIT  EXTENSION.  The obligation of the L/C
Issuer and each Lender to make its initial Credit Extension hereunder is subject
to satisfaction of the following conditions precedent:

     (a) The  Administrative  Agent's  receipt of the  following,  each of which
shall be  originals  or  telecopies  (followed  promptly  by  originals)  unless
otherwise  specified,  each properly  executed by a  Responsible  Officer of the
signing Loan Party, each dated the Closing Date (or, in the case of certificates
of  governmental  officials,  a recent date before the Closing Date) and each in
form and  substance  satisfactory  to the  Administrative  Agent and each of the
Lenders:

          (i) executed  counterparts  of this Agreement,  the Borrower  Security
     Agreement,  the Guarantor Security Agreements and the Guaranty,  sufficient
     in number for distribution to the Administrative Agent, each Lender and the
     Borrower;

          (ii)  a  Note  executed  by the  Borrower  in  favor  of  each  Lender
     requesting a Note;

          (iii) Intentionally Omitted;

          (iv)  confirmation of each Security Document (other than the Guaranty,
     Borrower Security Agreement and Guarantor Security  Agreements) in form and
     substance satisfactory to the Administrative Agent;

          (v) such  certificates  of  resolutions  or other  action,  incumbency
     certificates and/or other certificates of Responsible Officers of each Loan
     Party as the  Administrative  Agent may require  evidencing  the  identity,
     authority and capacity of each  Responsible  Officer thereof  authorized to
     act as a  Responsible  Officer in  connection  with this  Agreement and the
     other Loan Documents to which such Loan Party is a party;

          (vi) such documents and certifications as the Administrative Agent may
     reasonably  require to evidence  that each Loan Party is duly  organized or
     formed, and that each Loan Party is validly existing,  in good standing and
     qualified to engage in business in each  jurisdiction  where its ownership,
     lease or operation of  properties  or the conduct of its business  requires
     such  qualification,  except to the extent that  failure to do so could not
     reasonably be expected to have a Material Adverse Effect;

          (vii) a favorable  opinion of Phillips Lytle LLP,  counsel to the Loan
     Parties,  addressed to the Administrative  Agent and each Lender, as to the
     matters set forth in EXHIBIT G and such other matters  concerning  the Loan
     Parties and the Loan Documents as the  Administrative  Agent may reasonably
     request;

                                      S-57
<PAGE>

          (viii)  a  favorable  opinion  of the Law  Office  of  Brune  Lawyers,
     Oklahoma local counsel to Crane Equipment & Service, Inc., addressed to the
     Administrative Agent and each Lender;

          (ix) Intentionally Omitted;

          (x) a certificate  of a Responsible  Officer of each Loan Party either
     (A) attaching  copies of all consents,  licenses and approvals  required in
     connection with the execution,  delivery and performance by such Loan Party
     and the validity  against such Loan Party of the Loan Documents to which it
     is a party,  and such  consents,  licenses and  approvals  shall be in full
     force  and  effect,  or (B)  stating  that no such  consents,  licenses  or
     approvals are so required;

          (xi) a  certificate  signed by a  Responsible  Officer of the Borrower
     certifying  (A) that the conditions  specified in SECTIONS  4.02(A) and (B)
     have been satisfied, (B) that there has been no event or circumstance since
     March 31, 2005 that has had or could be reasonably expected to have, either
     individually or in the aggregate, a Material Adverse Effect, (C) that there
     shall not have been a material  adverse change to the facts and information
     regarding  the Loan Parties  provided to the  Administrative  Agent and the
     Lenders by the Borrowers on or prior to March 31, 2005 and (D) an officer's
     certificate in form and substance  satisfactory to the Administrative Agent
     certifying  as to  the  absence  of  any  action,  suit,  investigation  or
     proceeding  pending or, to the  knowledge of any Loan Party,  threatened in
     any court or before any  arbitrator or  governmental  authority  that could
     reasonably be expected to have a Material Adverse Effect;

          (xii) a duly  completed  Compliance  Certificate as of the last day of
     the fiscal  quarter of the Borrower  ended on January 1, 2006,  signed by a
     Responsible Officer of the Borrower;

          (xiii) evidence that all insurance required to be maintained  pursuant
     to the Loan Documents has been obtained and is in effect;

          (xiv)  Administrative  Agent  shall be  satisfied  that  the  Security
     Documents shall be effective to create in favor of the Administrative Agent
     a legal,  valid and enforceable first (except for Liens permitted  pursuant
     to SECTION 7.01 and entitled to priority  under  applicable  law)  security
     interest in and Lien upon the Collateral, along with, in form and substance
     satisfactory  to  the  Lenders,  evidence  that  all  filings,  recordings,
     deliveries of instruments  and other actions  necessary or desirable in the
     opinion of the  Administrative  Agent to protect and preserve such security
     interests shall have been duly effected;

          (xv) a  completed  and fully  executed  perfection  certificate  (or a
     bringdown of the perfection  certificate provided with respect to the First
     Amended and Restated Credit  Agreement) with respect to each Loan Party and
     the results of UCC searches (and the  equivalent  thereof in all applicable
     foreign   jurisdictions)   and   other   evidence   satisfactory   to   the
     Administrative  Agent that there are no Liens  upon the  Collateral,  other
     than Liens  permitted  pursuant to SECTION  7.01 and  otherwise in form and
     substance satisfactory to the Lenders;

                                      S-58
<PAGE>

          (xvi)   completed   environmental   questionnaires   and  such   other
     environmental  reports,  audits,  certifications  and  information  as  the
     Administrative  Agent  may  reasonably  require,  in each  case in form and
     substance satisfactory to the Administrative Agent;

          (xvii) the Administrative Agent and the Lenders shall have completed a
     confirmatory legal and business due diligence investigation, the results of
     which shall be satisfactory to the Administrative Agent and the Lenders;

          (xviii)   the   Administrative   Agent   shall   have   received   the
     fully-executed  Assignment and Assumption Agreement contemplated by SECTION
     2.01(B);

          (xix) assignments to the  Administrative  Agent for the benefit of the
     Lenders, of all notes and instruments evidencing intercompany  Indebtedness
     among the Borrower and its Subsidiaries;

          (xx) such  other  assurances,  certificates,  documents,  consents  or
     opinions as the Administrative Agent, the L/C Issuer, the Swing Line Lender
     or the Required Lenders reasonably may require.

     (b) Any fees  required to be paid on or before the Closing  Date shall have
been paid.

     (c) Unless waived by the Administrative Agent, the Borrower shall have paid
all fees,  charges  and  disbursements  of counsel to the  Administrative  Agent
(directly  to such  counsel if  requested  by the  Administrative  Agent) to the
extent invoiced prior to or on the Closing Date, plus such additional amounts of
such fees, charges and disbursements as shall constitute its reasonable estimate
of such fees, charges and disbursements incurred or to be incurred by it through
the  closing  proceedings  (provided  that such  estimate  shall not  thereafter
preclude  a  final   settling  of  accounts   between  the   Borrower   and  the
Administrative Agent).

     (d) The Closing Date shall have occurred on or before March 31, 2006.

     Without  limiting the  generality of the  provisions  of SECTION 9.04,  for
purposes of determining compliance with the conditions specified in this SECTION
4.01,  each  Lender  that has  signed  this  Agreement  shall be  deemed to have
consented  to,  approved or accepted or to be satisfied  with,  each document or
other matter required thereunder to be consented to or approved by or acceptable
or satisfactory to a Lender unless the Administrative  Agent shall have received
notice  from such Lender  prior to the  proposed  Closing  Date  specifying  its
objection thereto.

     4.02. CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of each Lender to
honor any Request  for Credit  Extension  (other  than a  Committed  Loan Notice
requesting  only a  conversion  of  Committed  Loans  to the  other  Type,  or a
continuation  of Eurodollar  Rate Loans) is subject to the following  conditions
precedent:

     (a) The  representations and warranties of the Borrower and each other Loan
Party contained in ARTICLE V or any other Loan Document,  or which are contained
in any  document  furnished  at any time  under  or in  connection  herewith  or
therewith,  shall  be true  and  correct  on and as of the  date of such  Credit

                                      S-59
<PAGE>

Extension,  except  to the  extent  that  such  representations  and  warranties
specifically  refer to an  earlier  date,  in which  case they shall be true and
correct as of such  earlier  date,  and except that for purposes of this SECTION
4.02, the representations and warranties contained in subsections (a) and (b) of
SECTION  5.05 shall be deemed to refer to the most recent  statements  furnished
pursuant to clauses (a) and (b), respectively, of SECTION 6.01.

     (b) No Default or Event of Default  shall exist,  or would result from such
proposed Credit Extension or from the application of the proceeds thereof.

     (c) The  Administrative  Agent and,  if  applicable,  the L/C Issuer or the
Swing  Line  Lender  shall  have  received a Request  for  Credit  Extension  in
accordance with the requirements hereof.

     Each  Request for Credit  Extension  (other  than a  Committed  Loan Notice
requesting  only a  conversion  of  Committed  Loans  to  the  other  Type  or a
continuation of Eurodollar Rate Loans) submitted by the Borrower shall be deemed
to be a  representation  and warranty that the conditions  specified in SECTIONS
4.02(A)  or (B) have  been  satisfied  on and as of the  date of the  applicable
Credit Extension.

                                   ARTICLE V.
                         REPRESENTATIONS AND WARRANTIES

     The Borrower  represents and warrants to the  Administrative  Agent and the
Lenders that:

     5.01.  EXISTENCE,  QUALIFICATION  AND  POWER.  Each  Loan  Party  and  each
Subsidiary  thereof (a) is duly  organized or formed,  validly  existing and, as
applicable,  in  good  standing  under  the  Laws  of  the  jurisdiction  of its
incorporation or organization, (b) has all requisite power and authority and all
requisite governmental licenses,  authorizations,  consents and approvals to (i)
own or lease its assets and carry on its business and (ii) execute,  deliver and
perform its obligations under the Loan Documents to which it is a party, and (c)
is duly qualified and is licensed and, as applicable, in good standing under the
Laws of each jurisdiction where its ownership,  lease or operation of properties
or the conduct of its business requires such qualification or license; except in
each case  referred to in clause (b)(i) or (c), to the extent that failure to do
so could not reasonably be expected to have a Material Adverse Effect.

     5.02.  AUTHORIZATION;   NO  CONTRAVENTION.   The  execution,  delivery  and
performance  by each Loan Party of each Loan  Document  to which such  Person is
party,   have  been  duly  authorized  by  all  necessary   corporate  or  other
organizational  action,  and do not and will not (a) contravene the terms of any
of such  Person's  Organization  Documents;  (b) conflict  with or result in any
breach or  contravention  of, or the creation of any Lien under,  or require any
payment to be made under (i) any Contractual  Obligation to which such Person is
a party or affecting  such Person or the properties of such Person or any of its
Subsidiaries or (ii) any order,  injunction,  writ or decree of any Governmental
Authority or any arbitral award to which such Person or its property is subject;
or (c) violate any Law.

     5.03.  GOVERNMENTAL  AUTHORIZATION;  OTHER CONSENTS. No approval,  consent,
exemption,  authorization, or other action by, or notice to, or filing with, any

                                      S-60
<PAGE>

Governmental  Authority  or  any  other  Person  is  necessary  or  required  in
connection  with the  execution,  delivery  or  performance  by, or  enforcement
against, any Loan Party of this Agreement or any other Loan Document.

     5.04.  BINDING  EFFECT.  This  Agreement  has  been,  and each  other  Loan
Document, when delivered hereunder,  will have been, duly executed and delivered
by each Loan Party that is party thereto. This Agreement  constitutes,  and each
other Loan  Document  when so  delivered  will  constitute,  a legal,  valid and
binding obligation of such Loan Party,  enforceable against each Loan Party that
is party thereto in accordance with its terms.

     5.05. FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT; NO INTERNAL CONTROL
EVENT.

     (a) The Audited  Financial  Statements (i) were prepared in accordance with
GAAP  consistently  applied  throughout  the period covered  thereby,  except as
otherwise  expressly noted therein;  (ii) fairly present the financial condition
of the Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance  with GAAP  consistently
applied  throughout the period covered  thereby,  except as otherwise  expressly
noted therein;  and (iii) show all material  indebtedness and other liabilities,
direct  or  contingent,  of the  Borrower  and its  Subsidiaries  as of the date
thereof, including liabilities for taxes, material commitments and Indebtedness.

     (b) The unaudited  consolidated  and  consolidating  balance  sheets of the
Borrower  and  its   Subsidiaries   dated  January  1,  2006,  and  the  related
consolidated and consolidating statements of income or operations, shareholders'
equity  and cash  flows  for the  fiscal  quarter  ended  on that  date (i) were
prepared in accordance  with GAAP  consistently  applied  throughout  the period
covered thereby,  except as otherwise  expressly noted therein,  and (ii) fairly
present the financial  condition of the Borrower and its  Subsidiaries as of the
date thereof and their results of  operations  for the period  covered  thereby,
subject, in the case of clauses (i) and (ii), to the absence of footnotes and to
normal  year-end  audit  adjustments.  SCHEDULE  5.05 sets  forth  all  material
indebtedness and other  liabilities,  direct or contingent,  of the Borrower and
its  consolidated  Subsidiaries  as of the  date of such  financial  statements,
including liabilities for taxes, material commitments and Indebtedness.

     (c) Since the date of the Audited Financial  Statements,  there has been no
event or circumstance,  either individually or in the aggregate, that has had or
could reasonably be expected to have a Material Adverse Effect.

     (d) To the best knowledge of the Borrower, no Internal Control Event exists
or has  occurred  since the date of the Audited  Financial  Statements  that has
resulted in or could  reasonably be expected to result in a misstatement  in any
material respect, in any financial  information  delivered or to be delivered to
the Administrative Agent or the Lenders, of (i) covenant compliance calculations
provided  hereunder  or (ii) the assets,  liabilities,  financial  condition  or
results of operations  of the Borrower and its  Subsidiaries  on a  consolidated
basis.

     (e)  The  consolidated  and  consolidating  forecasted  balance  sheet  and
statements  of  income  and cash  flows  of the  Borrower  and its  Subsidiaries
delivered  pursuant to SECTION  6.01(C) were prepared in good faith on the basis

                                      S-61

<PAGE>

of the assumptions  stated therein,  which assumptions were fair in light of the
conditions existing at the time of delivery of such forecasts,  and represented,
at the time of delivery,  the Borrower's  best estimate of its future  financial
condition and performance.

     5.06.  LITIGATION.  There are no  actions,  suits,  proceedings,  claims or
disputes  pending or, to the  knowledge of the  Borrower  after due and diligent
investigation,  threatened or contemplated, at law, in equity, in arbitration or
before any  Governmental  Authority,  by or against  the  Borrower or any of its
Subsidiaries or against any of their  properties or revenues that (a) purport to
affect or pertain to this  Agreement or any other Loan  Document,  or any of the
transactions  contemplated  hereby,  or (b) except as specifically  disclosed in
SCHEDULE 5.06, either individually or in the aggregate, if determined adversely,
could  reasonably be expected to have a Material  Adverse Effect,  and there has
been no adverse change in the status,  or financial  effect on any Loan Party or
any Subsidiary thereof, of the matters described on SCHEDULE 5.06.

     5.07. NO DEFAULT.  Neither any Loan Party nor any Subsidiary  thereof is in
default under or with respect to any Contractual  Obligation that could,  either
individually  or in the  aggregate,  reasonably  be  expected to have a Material
Adverse  Effect.  No Default has occurred and is continuing or would result from
the consummation of the transactions contemplated by this Agreement or any other
Loan Document.

     5.08.  OWNERSHIP  OF  PROPERTY;  LIENS.  Each  of  the  Borrower  and  each
Subsidiary  has good  record  and  marketable  title in fee  simple to, or valid
leasehold  interests  in, all real  property  necessary  or used in the ordinary
conduct  of its  business,  except  for such  defects  in  title  as could  not,
individually  or in the  aggregate,  reasonably  be  expected to have a Material
Adverse Effect.  The property of the Borrower and its Subsidiaries is subject to
no Liens, other than Liens permitted by SECTION 7.01.

     5.09. ENVIRONMENTAL  COMPLIANCE.  The Borrower and its Subsidiaries conduct
in the  ordinary  course  of  business  a  review  of  the  effect  of  existing
Environmental Laws and claims alleging potential liability or responsibility for
violation of any  Environmental Law on their respective  businesses,  operations
and  properties,  and as a result thereof the Borrower has reasonably  concluded
that, except as specifically disclosed in SCHEDULE 5.09, such Environmental Laws
and claims could not,  individually or in the aggregate,  reasonably be expected
to have a Material Adverse Effect.

     5.10.  INSURANCE.  The properties of the Borrower and its  Subsidiaries are
insured with financially sound and reputable  insurance companies not Affiliates
of the Borrower,  in such amounts (after giving effect to any insurance coverage
from CM Insurance Company,  Inc.  compatible with the following  standards) with
such deductibles and covering such risks as are customarily carried by companies
engaged in similar  businesses and owning similar properties in localities where
the Borrower or the applicable Subsidiary operates.

     5.11.  TAXES.  The  Borrower and its  Subsidiaries  have filed all Federal,
state and other material tax returns and reports  required to be filed, and have
paid all Federal,  state and other material taxes,  assessments,  fees and other
governmental charges levied or imposed upon them or their properties,  income or
assets otherwise due and payable, except those which are being contested in good

                                      S-62

<PAGE>

faith by  appropriate  proceedings  diligently  conducted and for which adequate
reserves have been provided in  accordance  with GAAP.  There is no proposed tax
assessment  against the Borrower or any Subsidiary  that would,  if made, have a
Material  Adverse Effect.  Neither any Loan Party nor any Subsidiary  thereof is
party to any tax sharing agreement.

     5.12. ERISA COMPLIANCE.

     (a) Each Plan is in compliance in all material respects with the applicable
provisions of ERISA, the Code and other Federal or state Laws. Each Plan that is
intended to qualify  under  Section  401(a) of the Code has received a favorable
determination  letter  from  the IRS or an  application  for  such a  letter  is
currently  being  processed  by the IRS with  respect  thereto  and, to the best
knowledge of the Borrower,  nothing has occurred which would  prevent,  or cause
the loss of, such qualification. The Borrower and each ERISA Affiliate have made
all required  contributions to each Plan subject to Section 412 of the Code, and
no application for a funding waiver or an extension of any  amortization  period
pursuant to Section 412 of the Code has been made with respect to any Plan.

     (b)  There  are no  pending  or,  to the best  knowledge  of the  Borrower,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with  respect to any Plan that could  reasonably  be expected to have a Material
Adverse  Effect.  There has been no prohibited  transaction  or violation of the
fiduciary  responsibility  rules with  respect to any Plan that has  resulted or
could reasonably be expected to result in a Material Adverse Effect.

     (c) (i) No ERISA  Event has  occurred or is  reasonably  expected to occur;
(ii) no Pension  Plan has any  Unfunded  Pension  Liability;  (iii)  neither the
Borrower nor any ERISA Affiliate has incurred,  or reasonably  expects to incur,
any  liability  under Title IV of ERISA with  respect to any Pension Plan (other
than premiums due and not delinquent under Section 4007 of ERISA);  (iv) neither
the Borrower nor any ERISA  Affiliate  has incurred,  or  reasonably  expects to
incur, any liability (and no event has occurred which, with the giving of notice
under Section 4219 of ERISA,  would result in such liability) under Section 4201
or 4243 of ERISA with  respect to a  Multiemployer  Plan;  and (v)  neither  the
Borrower  nor any ERISA  Affiliate  has engaged in a  transaction  that could be
subject to Section 4069 or 4212(c) of ERISA.

     5.13.  SUBSIDIARIES;  EQUITY  INTERESTS.  The Borrower has no  Subsidiaries
other than those specifically disclosed in Part (a) of SCHEDULE 5.13, and all of
the outstanding  Equity Interests in such Subsidiaries have been validly issued,
are fully paid and  nonassessable  and are owned by a Loan Party in the  amounts
specified on Part (a) of SCHEDULE 5.13 free and clear of all Liens. The Borrower
has no equity  investments  in any other  corporation or entity other than those
specifically  disclosed  in Part(b) of  SCHEDULE  5.13.  All of the  outstanding
Equity Interests in the Borrower have been validly issued and are fully paid and
nonassessable.

     5.14. MARGIN  REGULATIONS;  INVESTMENT  COMPANY ACT; PUBLIC UTILITY HOLDING
COMPANY ACT.

     (a) The Borrower is not engaged and will not engage,  principally or as one
of its important  activities,  in the business of purchasing or carrying  margin

                                      S-63

<PAGE>

stock  (within  the meaning of  Regulation  U issued by the FRB),  or  extending
credit for the purpose of purchasing or carrying margin stock.

     (b) None of the  Borrower,  any Person  Controlling  the  Borrower,  or any
Subsidiary (i) is a "holding  company," or a "subsidiary  company" of a "holding
company," or an "affiliate" of a "holding company" or of a "subsidiary  company"
of a "holding company," within the meaning of the Public Utility Holding Company
Act of  1935,  or (ii) is or is  required  to be  registered  as an  "investment
company" under the Investment Company Act of 1940.

     5.15.  DISCLOSURE.  The Borrower has disclosed to the Administrative  Agent
and the Lenders all agreements,  instruments and corporate or other restrictions
to which it or any of its  Subsidiaries is subject,  and all other matters known
to it, that,  individually or in the aggregate,  could reasonably be expected to
result in a Material Adverse Effect. No report, financial statement, certificate
or other information furnished (whether in writing or orally) by or on behalf of
any Loan Party to the Administrative  Agent or any Lender in connection with the
transactions  contemplated  hereby  and the  negotiation  of this  Agreement  or
delivered  hereunder or under any other Loan Document (in each case, as modified
or  supplemented  by other  information  so  furnished)  contains  any  material
misstatement  of fact or omits to state any material fact  necessary to make the
statements  therein,  in the light of the  circumstances  under  which they were
made,  not  misleading;  PROVIDED  that,  with  respect to  projected  financial
information,  the Borrower represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.

     5.16.  COMPLIANCE WITH LAWS. Each Loan Party and each Subsidiary thereof is
in compliance in all material respects with the requirements of all Laws and all
orders,  writs,  injunctions and decrees  applicable to it or to its properties,
except in such instances in which (a) such  requirement  of Law or order,  writ,
injunction or decree is being contested in good faith by appropriate proceedings
diligently conducted or (b) the failure to comply therewith, either individually
or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

     5.17. TAXPAYER  IDENTIFICATION NUMBER. The Borrower's true and correct U.S.
taxpayer identification number is set forth on SCHEDULE 10.02.

     5.18.   INTELLECTUAL  PROPERTY;   LICENSES,   ETC.  The  Borrower  and  its
Subsidiaries  own, or possess the right to use, all of the  trademarks,  service
marks, trade names, copyrights, patents, patent rights, franchises, licenses and
other  intellectual  property  rights  (collectively,   "IP  RIGHTS")  that  are
reasonably necessary for the operation of their respective  businesses,  without
conflict  with the  rights of any other  Person.  To the best  knowledge  of the
Borrower,  no slogan or other  advertising  device,  product,  process,  method,
substance,  part or other  material  now  employed,  or now  contemplated  to be
employed,  by the Borrower or any  Subsidiary  infringes upon any rights held by
any other  Person.  Set forth on SCHEDULE  5.18 hereto is a complete list of all
patents,  trademarks  and  copyrights of the Borrower and its  Subsidiaries.  No
claim or  litigation  regarding  any of the foregoing is pending or, to the best
knowledge of the Borrower,  threatened,  which,  either  individually  or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

                                      S-64
<PAGE>

     5.19. PERFECTION OF SECURITY INTEREST.  All filings,  assignments,  pledges
and deposits of documents or  instruments  have been made and all other  actions
have been taken that are  necessary  or  advisable,  under  applicable  law,  to
establish  and  perfect  the  Administrative  Agent's  first  priority  security
interest in the Collateral. The Collateral and the Administrative Agent's rights
with  respect  to  the  Collateral  are  not  subject  to  any  setoff,  claims,
withholdings or other defenses.  The Borrower and each Guarantor is the owner of
the  Collateral  free from any Lien,  except  for Liens  permitted  pursuant  to
SECTION 7.01.

     5.20. PROPERTIES.


          (a) Each of the Borrower and its  Subsidiaries has good and marketable
     title to, or valid,  subsisting and enforceable leasehold interests in, all
     of its Properties material to its business.  All machinery and equipment of
     each of the Borrower and its  Subsidiaries  is in good operating  condition
     and repair,  and all necessary  replacements of and repairs thereto have be
     made so as to preserve and maintain the value and  operating  efficiency of
     such machinery and equipment.

          (b) As of the Closing Date,  SCHEDULE 5.20 annexed  hereto  contains a
     true,  accurate and complete  list of all fee and  leasehold  real property
     assets of the Borrower and its Subsidiaries.

     5.21. SOLVENCY. Upon and immediately after consummation of the transactions
contemplated hereby, each of the Loan Parties is Solvent.

     5.22.  BANK  ACCOUNTS.  SCHEDULE  5.22 lists all banks and other  financial
institutions  at  which  the  Borrower  and  each of its  Domestic  Subsidiaries
maintains  deposits  and/or  other  accounts  as of the Closing  Date,  and such
Schedule correctly identifies the name and address of each depository,  the name
in which the account is held, a description  of the purpose of the account,  and
the complete account number.

     5.23.  OBLIGATIONS  AS  SENIOR  DEBT.  The  Obligations  constitute  Senior
Indebtedness  (as defined in the Senior Note  Indenture) and  Designated  Senior
Indebtedness (as defined in the Senior  Subordinated  Note Indenture).  As such,
all of the Obligations (and the  Administrative  Agent and Lenders) are entitled
to the benefits of each of the subordination  and other provisions  contained in
the (A)  Senior  Note  Indenture  which  are  available  in  respect  of  Senior
Indebtedness (and to the holders thereof), (b) the Intercreditor  Agreement, and
(c) the Senior  Subordinated  Note  Indenture  which are available in respect of
Designated Senior  Indebtedness  (and to the holders thereof),  and each of such
subordination  and other  provisions is in full force and effect and enforceable
in accordance with its terms.

     5.24.  USE OF  PROCEEDS.  The Borrower  and its  Subsidiaries  will use the
proceeds of the Loans for the purposes specified in SECTION 6.11 and not for any
other purpose.

                                      S-65
<PAGE>

                                  ARTICLE VI.
                              AFFIRMATIVE COVENANTS

     So long as any Lender  shall  have any  Commitment  hereunder,  any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied,  or any Letter of
Credit shall remain  outstanding,  the Borrower shall,  and shall (except in the
case of the covenants  set forth in SECTIONS  6.01,  6.02,  and 6.03) cause each
Subsidiary to:

     6.01.  FINANCIAL  STATEMENTS.  Deliver to the Administrative Agent and each
Lender,  in form and detail  satisfactory  to the  Administrative  Agent and the
Required Lenders:

     (a) as soon as available,  but in any event within 90 days after the end of
each  fiscal year of the  Borrower  and its  Subsidiaries,  a  consolidated  and
consolidating  balance sheet of the Borrower and its  Subsidiaries as at the end
of such fiscal year, and the related  consolidated and consolidating  statements
of income or  operations,  shareholders'  equity and cash flows for such  fiscal
year,  setting  forth  in each  case in  comparative  form the  figures  for the
previous  fiscal year, all in reasonable  detail and prepared in accordance with
GAAP, such consolidated statements to be audited and accompanied by (i) a report
and opinion of a Registered  Public  Accounting  Firm of  nationally  recognized
standing reasonably acceptable to the Required Lenders, which report and opinion
shall be prepared in accordance with generally  accepted auditing  standards and
applicable  Securities  Laws and shall not be subject to any "going  concern" or
like  qualification  or  exception or any  qualification  or exception as to the
scope of such audit or with respect to the absence of any material  misstatement
and (ii) an opinion of such  Registered  Public  Accounting  Firm  independently
assessing  the  Borrower's   internal  controls  over  financial   reporting  in
accordance with Item 308 of SEC Regulation  S-K, PCAOB Auditing  Standard No. 2,
and Section 404 of  Sarbanes-Oxley  expressing  a  conclusion  that  contains no
statement that there is a material  weakness in such internal  controls,  except
for such  material  weaknesses  as to which the  Administrative  Agent  does not
object, and such consolidating statements to be certified by the chief executive
officer, chief financial officer, treasurer or controller of the Borrower to the
effect that such  statements  are fairly  stated in all material  respects  when
considered in relation to the consolidated  financial statements of the Borrower
and its Subsidiaries;

     (b) as soon as available,  but in any event within 45 days after the end of
each of the first three fiscal  quarters of each fiscal year of the Borrower and
its Subsidiaries, a consolidated and consolidating balance sheet of the Borrower
and its  Subsidiaries  as at the end of such  fiscal  quarter,  and the  related
consolidated and consolidating statements of income or operations, shareholders'
equity  and cash  flows  for such  fiscal  quarter  and for the  portion  of the
Borrower's  fiscal year then ended,  setting  forth in each case in  comparative
form the figures for the  corresponding  fiscal  quarter of the previous  fiscal
year  and  the  corresponding  portion  of  the  previous  fiscal  year,  all in
reasonable detail and certified by the chief executive officer,  chief financial
officer,  treasurer  or  controller  of the  Borrower as fairly  presenting  the
financial condition, results of operations,  shareholders' equity and cash flows
of the Borrower and its  Subsidiaries in accordance  with GAAP,  subject only to
normal year-end audit adjustments and the absence of footnotes; and

     (c) as soon as available,  but in any event no later than 30 days after the
start of each fiscal year of the Borrower, budgets prepared by management of the

                                      S-66
<PAGE>

Borrower,  in form satisfactory to the Administrative Agent, of consolidated and
consolidating  balance  sheets and  statements of income or operations  and cash
flows of the Borrower and its  Subsidiaries on a quarterly basis for such fiscal
year.

     As to any information  contained in materials furnished pursuant to SECTION
6.02(C),  the  Borrower  shall  not  be  separately  required  to  furnish  such
information  under clause (a) or (b) above,  but the  foregoing  shall not be in
derogation  of the  obligation  of the Borrower to furnish the  information  and
materials described in clauses (a) and (b) above at the times specified therein.

     6.02. CERTIFICATES;  OTHER INFORMATION. Deliver to the Administrative Agent
and each Lender, in form and detail satisfactory to the Administrative Agent and
the Required Lenders:

     (a) concurrently with the delivery of the financial  statements referred to
in  SECTIONS  6.01(A) AND (B)  commencing  with the  delivery  of the  financial
statements  for the fiscal  quarter year ended March 31, 2006, a duly  completed
Compliance  Certificate signed by the chief executive  officer,  chief financial
officer, treasurer or controller of the Borrower;

     (b) promptly after any request by the  Administrative  Agent or any Lender,
copies of any detailed  audit  reports,  management  letters or  recommendations
submitted  to the board of  directors  (or the audit  committee  of the board of
directors) of the Borrower by  independent  accountants  in connection  with the
accounts  or books of the  Borrower  or any  Subsidiary,  or any audit of any of
them;

     (c) promptly  after the same are  available,  copies of each annual report,
proxy or  financial  statement  or other  report  or  communication  sent to the
stockholders of the Borrower,  and copies of all annual,  regular,  periodic and
special reports and  registration  statements  which the Borrower may file or be
required  to file  with the SEC  under  Section  13 or  15(d) of the  Securities
Exchange  Act of  1934,  and  not  otherwise  required  to be  delivered  to the
Administrative Agent pursuant hereto;

     (d)  promptly  after the  furnishing  thereof,  copies of any  statement or
report  furnished  to any  holder of debt  securities  of any Loan  Party or any
Subsidiary  thereof  pursuant to the terms of any  indenture,  loan or credit or
similar  agreement  and not  otherwise  required to be  furnished to the Lenders
pursuant to SECTION 6.01 or any other clause of this SECTION 6.02;

     (e)  promptly,  and in any event within five  Business  Days after  receipt
thereof by any Loan Party or any  Subsidiary  thereof,  copies of each notice or
other  correspondence  received  from  the  SEC  (or  comparable  agency  in any
applicable  non-U.S.  jurisdiction)  concerning  any  investigation  or possible
investigation  or other  inquiry by such  agency  regarding  financial  or other
operational results of any Loan Party or any Subsidiary thereof; and

     (f) promptly, such additional information regarding the business, financial
or corporate  affairs of the Borrower or any Subsidiary,  or compliance with the
terms of the Loan Documents,  as the Administrative Agent or any Lender may from
time to time reasonably request.

                                      S-67
<PAGE>

     Documents  required to be delivered  pursuant to SECTION  6.01(A) or (B) or
SECTION  6.02(C) (to the extent any such  documents  are  included in  materials
otherwise  filed  with  the  SEC)  may  be  delivered  electronically  and if so
delivered,  shall be deemed to have been  delivered on the date (i) on which the
Borrower  posts such  documents,  or provides a link  thereto on the  Borrower's
website on the Internet at the website address listed on SCHEDULE 10.02; or (ii)
on which such  documents are posted on the  Borrower's  behalf on an Internet or
intranet website, if any, to which each Lender and the Administrative Agent have
access (whether a commercial,  third-party  website or whether  sponsored by the
Administrative  Agent);  PROVIDED  that:  (i) the Borrower  shall  deliver paper
copies of such documents to the Administrative Agent or any Lender that requests
the  Borrower  to deliver  such paper  copies  until a written  request to cease
delivering paper copies is given by the Administrative  Agent or such Lender and
(ii) the  Borrower  shall  notify the  Administrative  Agent and each Lender (by
telecopier or electronic  mail) of the posting of any such documents and provide
to the Administrative  Agent by electronic mail electronic  versions (I.E., soft
copies)  of such  documents.  Except for  Compliance  Certificates  required  by
SECTION 6.02(A),  the  Administrative  Agent shall have no obligation to request
the delivery or to maintain  copies of the documents  referred to above,  and in
any event shall have no  responsibility  to monitor  compliance  by the Borrower
with any such request for delivery,  and each Lender shall be solely responsible
for requesting delivery to it or maintaining its copies of such documents.

     The Borrower hereby  acknowledges that (a) the Administrative  Agent and/or
the Arranger  will make  available  to the Lenders and the L/C Issuer  materials
and/or  information   provided  by  or  on  behalf  of  the  Borrower  hereunder
(collectively,  "BORROWER  Materials")  by posting  the  Borrower  Materials  on
IntraLinks or another similar electronic system (the "PLATFORM") and (b) certain
of the Lenders may be "public-side"  Lenders (I.E.,  Lenders that do not wish to
receive  material  non-public  information  with  respect to the Borrower or its
securities)  (each, a "PUBLIC LENDER").  The Borrower hereby agrees that (w) all
Borrower  Materials  that are to be made  available to Public  Lenders  shall be
clearly and conspicuously  marked "PUBLIC" which, at a minimum,  shall mean that
the word "PUBLIC"  shall appear  prominently  on the first page thereof;  (x) by
marking  Borrower  Materials  "PUBLIC,"  the  Borrower  shall be  deemed to have
authorized  the  Administrative  Agent,  the  Arranger,  the L/C  Issuer and the
Lenders  to  treat  such  Borrower  Materials  as not  containing  any  material
non-public  information  with  respect to the  Borrower  or its  securities  for
purposes of United States Federal and state securities laws (PROVIDED,  HOWEVER,
that to the extent such Borrower Materials constitute Information, they shall be
treated  as set forth in  Section  10.07);  (y) all  Borrower  Materials  marked
"PUBLIC" are  permitted to be made  available  through a portion of the Platform
designated "Public Investor;" and (z) the Administrative  Agent and the Arranger
shall be entitled to treat any Borrower  Materials that are not marked  "PUBLIC"
as being  suitable only for posting on a portion of the Platform not  designated
"Public Investor."

     6.03. NOTICES. Promptly notify the Administrative Agent and each Lender of:

     (a) the occurrence of any Default;

     (b) any matter that has resulted or could  reasonably be expected to result
in a Material Adverse Effect, including (i) breach or non-performance of, or any

                                      S-68
<PAGE>

default under, a Contractual Obligation of the Borrower or any Subsidiary;  (ii)
any dispute,  litigation,  investigation,  proceeding or suspension  between the
Borrower  or any  Subsidiary  and  any  Governmental  Authority;  or  (iii)  the
commencement  of, or any material  development  in, any litigation or proceeding
affecting the Borrower or any Subsidiary,  including  pursuant to any applicable
Environmental Laws;

     (c) the occurrence of any ERISA Event;

     (d) any  material  change in  accounting  policies or  financial  reporting
practices by the Borrower or any Subsidiary; and

     (e) the  determination by the Registered  Public  Accounting Firm providing
the  opinion  required  under  SECTION   6.01(A)(II)  (in  connection  with  its
preparation of such opinion) or the Borrower's  determination at any time of the
occurrence or existence of any Internal Control Event.

     Each  notice  pursuant  to this  SECTION  6.03  shall be  accompanied  by a
statement of a Responsible  Officer of the Borrower setting forth details of the
occurrence  referred to therein and stating  what action the  Borrower has taken
and  proposes to take with  respect  thereto.  Each  notice  pursuant to SECTION
6.03(A)  shall  describe  with  particularity  any  and all  provisions  of this
Agreement and any other Loan Document that have been breached.

     6.04.  PAYMENT OF  OBLIGATIONS.  Pay and discharge as the same shall become
due and payable,  all its  obligations  and  liabilities,  including (a) all tax
liabilities,  assessments  and  governmental  charges  or levies  upon it or its
properties  or  assets,  unless  the same are being  contested  in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance
with GAAP are being  maintained  by the  Borrower  or such  Subsidiary;  (b) all
lawful  claims which,  if unpaid,  would by law become a Lien upon its property;
and (c) all  Indebtedness,  as and  when due and  payable,  but  subject  to any
subordination  provisions  contained in any  instrument or agreement  evidencing
such Indebtedness.

     6.05. PRESERVATION OF EXISTENCE,  ETC. (a) Preserve,  renew and maintain in
full force and effect its legal  existence and good  standing  under the Laws of
the  jurisdiction  of its  organization  except in a  transaction  permitted  by
SECTION  7.04 or 7.05;  (b) take all  reasonable  action to maintain all rights,
privileges,  permits,  licenses  and  franchises  necessary  or desirable in the
normal conduct of its business, except to the extent that failure to do so could
not reasonably be expected to have a Material  Adverse Effect;  and (c) preserve
or renew all of its  registered  patents,  trademarks,  trade  names and service
marks,  the  non-preservation  of which could  reasonably  be expected to have a
Material Adverse Effect.

     6.06. MAINTENANCE OF PROPERTIES. (a) Maintain,  preserve and protect all of
its material properties and equipment necessary in the operation of its business
in good working order and condition,  ordinary wear and tear excepted;  (b) make
all necessary repairs thereto and renewals and replacements thereof except where
the failure to do so could not reasonably be expected to have a Material Adverse
Effect;  and  (c) use  the  standard  of care  typical  in the  industry  in the
operation and maintenance of its facilities.

                                      S-69
<PAGE>

     6.07.  MAINTENANCE  OF  INSURANCE.  Maintain  with  financially  sound  and
reputable  insurance  companies not  Affiliates of the Borrower,  insurance with
respect  to its  properties  and  business  against  loss or damage of the kinds
customarily  insured against by Persons engaged in the same or similar business,
of such types and in such amounts(after  giving effect to any insurance coverage
from CM Insurance Company,  Inc. compatible with the following standards) as are
customarily  carried  under  similar  circumstances  by such other  Persons  and
providing for not less than 30 days' prior notice to the Administrative Agent of
termination, lapse or cancellation of such insurance.

     6.08.  COMPLIANCE  WITH  LAWS,  ORGANIZATIONAL  DOCUMENTS  AND  CONTRACTUAL
OBLIGATIONS.  Comply in all material  respects with the requirements of all Laws
and all  orders,  writs,  injunctions  and  decrees  applicable  to it or to its
business or property,  except in such instances in which (a) such requirement of
Law or order,  writ,  injunction  or decree is being  contested in good faith by
appropriate  proceedings  diligently  conducted;  or (b) the  failure  to comply
therewith  could not reasonably be expected to have a Material  Adverse  Effect.
Comply with all  Organization  Documents and, except where the failure to comply
therewith  could not reasonably be expected to have a Material  Adverse  Effect,
all material Contractual Obligations.

     6.09.  BOOKS AND RECORDS.  (a) Maintain proper books of record and account,
in which full,  true and correct  entries in conformity  with GAAP  consistently
applied shall be made of all financial  transactions  and matters  involving the
assets and business of the Borrower or such Subsidiary,  as the case may be; and
(b) maintain  such books of record and account in material  conformity  with all
applicable   requirements  of  any  Governmental   Authority  having  regulatory
jurisdiction over the Borrower or such Subsidiary, as the case may be.

     6.10. INSPECTION RIGHTS. Permit representatives and independent contractors
of the  Administrative  Agent and each  Lender to visit and  inspect  any of its
properties, to examine its corporate,  financial and operating records, and make
copies thereof or abstracts therefrom, and to discuss its affairs,  finances and
accounts with its directors,  officers, and independent public accountants,  all
at the  expense of the  Borrower  and at such  reasonable  times  during  normal
business  hours  and as  often as may be  reasonably  desired,  upon  reasonable
advance notice to the Borrower; PROVIDED, HOWEVER, that when an Event of Default
exists  the  Administrative  Agent or any  Lender  (or any of  their  respective
representatives  or independent  contractors) may do any of the foregoing at the
expense of the  Borrower at any time during  normal  business  hours and without
advance notice.

     6.11.  USE OF PROCEEDS.  Use the proceeds of the Credit  Extensions for (a)
general corporate purposes,  including working capital, capital expenditures and
other lawful corporate purposes,  (b) to refinance  Indebtedness  existing as of
the Closing Date, (c) to finance acquisitions permitted pursuant to Section 7.02
and (d) to repurchase the Senior Notes, Senior  Subordinated  Notes,  Additional
Subordinated  Indebtedness and other Indebtedness for borrowed money, so long as
such  Indebtedness  and such  repurchases  are  otherwise  permitted  under this
Agreement,  and not for any other purpose or in  contravention  of any Law or of
any Loan Document.

     6.12. ADDITIONAL  GUARANTORS AND PLEDGORS.  Notify the Administrative Agent
at the time that any Person becomes a Subsidiary and promptly thereafter (and in

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any  event  within  30  days),  (a)  unless  such  Person  is not a  Significant
Subsidiary  of any Loan Party or, if such  Subsidiary  is a Foreign  Subsidiary,
executing a Guaranty would result in a materially adverse tax consequence to the
Loan  Parties or such  Subsidiary,  cause such Person to become a  Guarantor  by
executing  and  delivering  to the  Administrative  Agent a  counterpart  of the
Guaranty  or  such  other  document  as  the  Administrative  Agent  shall  deem
appropriate for such purpose,  (b) if such Subsidiary is a Significant  Domestic
Subsidiary or a first-tier Foreign Subsidiary,  the parent entity of such Person
shall  pledge the equity of such  Subsidiary  as security  for the  Obligations;
PROVIDED THAT, with respect to Foreign Subsidiaries, such equity pledge shall be
limited to 65% of the capital stock of such Foreign Subsidiary to the extent the
pledge  of  any  greater   percentage  would  result  in  material  adverse  tax
consequences  to  any  Loan  Party,  (c)  deliver  to the  Administrative  Agent
documents  of the types  referred to in clauses (v) and (vi) of SECTION  4.01(A)
and favorable opinions of counsel to such Person (which shall cover, among other
things,  the  legality,  validity,  binding  effect  and  enforceability  of the
documentation  referred  to in clauses  (a) and (b)),  all in form,  content and
scope reasonably satisfactory to the Administrative Agent.

     6.13. MORTGAGES. The Obligations shall be secured by Mortgages upon (i) all
fee real estate assets of the Loan Parties  located in the United States,  other
than the real  estate  located  at 1113  South  Greenwood  Avenue,  Chattanooga,
Tennessee and the property located at Allin Street, Chattanooga,  Tennessee, and
(ii)  material  leasehold  real estate  assets of the Loan Parties  described on
SCHEDULE  6.13.  If any Loan Party  acquires  any fee or  leasehold  real estate
interest  after the Closing Date, it shall  promptly  notify the  Administrative
Agent  thereof  and  shall,  if such  real  estate  interest  is  deemed  by the
Administrative  Agent to be  material,  execute,  deliver  and record a Mortgage
sufficient to create a first priority Lien in favor of  Administrative  Agent on
such real  estate,  and shall  deliver all  Related  Real  Estate  Documents  in
connection  therewith  that may be required by the  Administrative  Agent in its
reasonable discretion.

     6.14. POST-CLOSING  DELIVERIES.  On or before April 16, 2006, or such later
date as may be agreed, in writing, by the Administrative  Agent,  deliver to the
Administrative Agent:

     (a) confirmations  assignments or amendments,  as the case may be, executed
by  the  Borrower  and/or  the  Guarantors,  as  applicable,  and  filed  in the
appropriate foreign  jurisdictions,  each in form and substance  satisfactory to
the Administrative  Agent and its counsel,  of the share pledges by the Borrower
or the relevant  Guarantor of the equity interests of such entity in each of (a)
Audubon  Europe,  (b)  Yale  Industrial  Products  GmbH,  (c)  Larco  Industrial
Services,  Inc., (d) Societe  D'Exploitation Des Raccords Gautier,  (e) Univeyor
A/S and (f) Columbus McKinnon Ltd.;

     (b) amendments to each of the Mortgages, in form and substance suitable for
filing within applicable real estate records and otherwise in form and substance
satisfactory to the Administrative  Agent and a bringdown to the Closing Date of
the title  insurance  policy  covering each Mortgage for which a title insurance
policy is in place prior to the Closing Date, in form and substance satisfactory
to the Administrative Agent; and

     (c) a favorable opinion of Linklaters  Loesch,  Luxembourg local counsel to
Audubon Europe regarding each of the Loan Documents to which Audubon Europe is a
party.

                                      S-71
<PAGE>

                                  ARTICLE VII.
                               NEGATIVE COVENANTS

     So long as any Lender  shall  have any  Commitment  hereunder,  any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied,  or any Letter of
Credit shall remain outstanding, the Borrower shall not, nor shall it permit any
Subsidiary to, directly or indirectly:

     7.01. LIENS. Create,  incur, assume or suffer to exist any Lien upon any of
its property, assets or revenues, whether now owned or hereafter acquired, other
than the following:

     (a) Liens pursuant to any Loan Document;

     (b) Liens  existing on the date hereof and listed on SCHEDULE  7.01 and any
renewals or extensions  thereof,  PROVIDED that (i) the property covered thereby
is not changed,  (ii) the amount  secured or benefited  thereby is not increased
except as  contemplated by SECTION  7.03(B),  (iii) the direct or any contingent
obligor with respect  thereto is not changed,  and (iv) any renewal or extension
of the obligations secured or benefited thereby is permitted by SECTION 7.03(B);

     (c) Liens for taxes not yet due or which are being  contested in good faith
and by appropriate  proceedings diligently conducted,  if adequate reserves with
respect  thereto  are  maintained  on the  books  of the  applicable  Person  in
accordance with GAAP;

     (d) carriers', warehousemen's,  mechanics',  materialmen's,  repairmen's or
other  like Liens  arising  in the  ordinary  course of  business  which are not
overdue for a period of more than 30 days or which are being  contested  in good
faith and by appropriate  proceedings diligently conducted, if adequate reserves
with respect thereto are maintained on the books of the applicable Person;

     (e) pledges or deposits in the  ordinary  course of business in  connection
with workers'  compensation,  unemployment  insurance and other social  security
legislation, other than any Lien imposed by ERISA;

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

     (g) easements,  rights-of-way,  restrictions and other similar encumbrances
affecting real property which, in the aggregate,  are not substantial in amount,
and which do not in any case  materially  detract from the value of the property
subject  thereto  or  materially  interfere  with the  ordinary  conduct  of the
business of the applicable Person;

     (h) Liens securing  judgments for the payment of money not  constituting an
Event of Default under SECTION 8.01(H);

     (i) Liens securing Indebtedness  permitted under SECTION 7.03(E);  PROVIDED
that (i) such  Liens do not at any time  encumber  any  property  other than the

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<PAGE>

property financed by such Indebtedness and (ii) the Indebtedness secured thereby
does not  exceed  the cost or fair  market  value,  whichever  is lower,  of the
property being acquired on the date of acquisition; and

     (j) second  priority  Liens on the  Collateral  in favor of the Senior Note
Indenture  Trustee under any of the Senior Note  Documents  which are subject to
the Intercreditor  Agreement and junior in priority to the Liens in favor of the
Administrative Agent under the Loan Documents.

     7.02. INVESTMENTS. Make any Investments, except:

     (a) Investments held by the Borrower or such Subsidiary in the form of cash
equivalents or short-term marketable debt securities;

     (b)  Investments  of the  Borrower  and/or its  Subsidiaries  in any of the
Borrower's  Subsidiaries which are not Domestic Subsidiaries;  PROVIDED that the
aggregate amount of such Investments made after the Closing Date does not exceed
$10,000,000;

     (c)  advances to  officers,  directors  and  employees  of the Borrower and
Subsidiaries  in an  aggregate  amount  not  to  exceed  $500,000  at  any  time
outstanding,  for  travel,  entertainment,  relocation  and  analogous  ordinary
business purposes;

     (d)  Investments  of the Borrower in any Guarantor and  Investments  of any
Subsidiary in the Borrower or in another Guarantor;

     (e)  Investments  consisting  of  extensions  of  credit  in the  nature of
accounts  receivable or notes receivable  arising from the grant of trade credit
in the ordinary course of business,  and Investments received in satisfaction or
partial  satisfaction  thereof from financially  troubled account debtors to the
extent reasonably necessary in order to prevent or limit loss;

     (f) Guarantees permitted by SECTION 7.03;

     (g) Investments held in the investment  portfolio of CM Insurance  Company,
Inc.  of the type and in  amounts  in the  ordinary  course  of  business  of CM
Insurance Company, Inc. and consistent with past practices; and

     (h) other Investments not exceeding $25,000,000 in the aggregate during the
term of this Agreement.

     7.03.   INDEBTEDNESS.   Create,  incur,  assume  or  suffer  to  exist  any
Indebtedness, except:

     (a) Indebtedness under the Loan Documents;

     (b) Indebtedness outstanding on the date hereof and listed on SCHEDULE 7.03
and any refinancings,  refundings, renewals or extensions thereof; PROVIDED that
(i) the  amount  of  such  Indebtedness  is not  increased  at the  time of such
refinancing,  refunding,  renewal or  extension  except by an amount  equal to a
reasonable  premium  or other  reasonable  amount  paid,  and fees and  expenses
reasonably incurred,  in connection with such refinancing and by an amount equal
to any existing commitments unutilized thereunder and (ii) the terms relating to

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<PAGE>

principal amount, amortization,  maturity, collateral (if any) and subordination
(if any), and other material  terms taken as a whole,  of any such  refinancing,
refunding, renewing or extending Indebtedness, and of any agreement entered into
and of any instrument issued in connection  therewith,  are no less favorable in
any  material  respect to the Loan  Parties or the Lenders than the terms of any
agreement or instrument  governing the Indebtedness being refinanced,  refunded,
renewed or extended and the interest rate  applicable  to any such  refinancing,
refunding,   renewing  or  extending  Indebtedness  does  not  exceed  the  then
applicable market interest rate;

     (c) Guarantees of the Borrower or any Guarantor in respect of  Indebtedness
otherwise permitted hereunder of the Borrower or any other Guarantor;

     (d) obligations (contingent or otherwise) of the Borrower or any Subsidiary
existing or arising under any Swap Contract,  provided that (i) such obligations
are (or were) entered into by such Person in the ordinary course of business for
the  purpose  of  directly   mitigating  risks   associated  with   liabilities,
commitments,  investments, assets, or property held or reasonably anticipated by
such Person,  or changes in the value of securities  issued by such Person,  and
not for purposes of  speculation  or taking a "market  view;" and (ii) such Swap
Contract does not contain any provision  exonerating  the  non-defaulting  party
from  its  obligation  to  make  payments  on  outstanding  transactions  to the
defaulting party;

     (e)  Indebtedness of the Borrower in respect of capital  leases,  Synthetic
Lease  Obligations  and purchase money  obligations  for fixed or capital assets
within the limitations set forth in SECTION 7.01(I); PROVIDED, HOWEVER, that the
aggregate amount of all such  Indebtedness at any one time outstanding shall not
exceed $6,000,000;

     (f) Additional Subordinated Indebtedness;

     (g)  intercompany  loans among the Borrower and the Loan Parties  which are
Guarantors; provided, that (i) the Investment corresponding to such Indebtedness
is permitted  pursuant to SECTION 7.02 hereof,  (ii) such  intercompany  loan is
evidenced by a promissory  note,  (iii) such  promissory  note is pledged to the
Administrative Agent as security, and (iv) there are no restrictions  whatsoever
on the ability of the applicable Loan Party to repay such loan;

     (h) Indebtedness of any Foreign  Subsidiary of the Borrower in an aggregate
amount for all such Indebtedness not to exceed the local currency equivalent (as
determined  by the  Administrative  Agent form time to time by  reference to the
Exchange  Rate) of  $30,000,000  in the  aggregate at any one time  outstanding;
PROVIDED THAT (i) the proceeds of such Indebtedness are used for working capital
needs,  capital  expenditures  and the acquisition of assets or equity interests
permitted pursuant to SECTION 7.02, (ii) such Indebtedness is incurred solely by
such Foreign Subsidiary, (iii) such Indebtedness is either unsecured or, if such
Foreign  Subsidiary  is not a  Guarantor  is secured  only by the assets of such
Foreign Subsidiary and (iv) except as permitted under SECTION 7.02(B) or SECTION
7.02(H),  no  guaranty  or other  credit  support of any kind is provided by any
Person  (including,   without  limitation,  any  Loan  Party)  of  or  for  such
Indebtedness or any holder  thereof;  and provided,  further,  that the Borrower
shall notify the Administrative  Agent in writing in advance prior to permitting
such Foreign Subsidiary to incur any Indebtedness under this SECTION 7.03(H);

                                      S-74
<PAGE>

     (i)  Indebtedness of the Borrower in an aggregate  principal  amount not to
exceed $70,256,000, evidenced by or incurred under the Senior Note Documents;

     (j)  Indebtedness of the Borrower in an aggregate  principal  amount not to
exceed $136,000,000, evidenced by or incurred under the Senior Subordinated Note
Documents; and

     (k) other unsecured  Indebtedness in a principal amount  outstanding at any
one time not exceeding $10,000,000.

     7.04. FUNDAMENTAL CHANGES. Merge, dissolve, liquidate,  consolidate with or
into another Person, or Dispose of (whether in one transaction or in a series of
transactions)  all or  substantially  all of its  assets  (whether  now owned or
hereafter  acquired) to or in favor of any Person,  except  that,  so long as no
Default exists or would result therefrom:

     (a) any  Subsidiary  may merge  with (i) the  Borrower,  PROVIDED  that the
Borrower  shall be the continuing or surviving  Person,  or (ii) any one or more
other  Subsidiaries,  PROVIDED  that when any  Guarantor is merging with another
Subsidiary,  the Guarantor  shall be the  continuing or surviving  Person or the
surviving Person shall become a Guarantor; and

     (b) any  Subsidiary may Dispose of all or  substantially  all of its assets
(upon  voluntary  liquidation  or  otherwise)  to  the  Borrower  or to  another
Subsidiary;  PROVIDED  that  if  the  transferor  in  such  a  transaction  is a
Guarantor,  then the  transferee  must either be the  Borrower or a Guarantor or
become a Guarantor.

     7.05.  DISPOSITIONS.  Make any  Disposition  or enter into any agreement to
make any Disposition, except:

     (a)  Dispositions  of obsolete or worn out  property,  whether now owned or
hereafter acquired, in the ordinary course of business;

     (b) Dispositions of inventory in the ordinary course of business;

     (c)  Dispositions of equipment or real property to the extent that (i) such
property  is  exchanged  for  credit  against  the  purchase  price  of  similar
replacement  property or (ii) the proceeds of such  Disposition  are  reasonably
promptly applied to the purchase price of such replacement property;

     (d)  Dispositions  of property by any  Subsidiary  to the  Borrower or to a
wholly-owned  Subsidiary;  PROVIDED that if the transferor of such property is a
Guarantor,  the transferee thereof must either be the Borrower or a Guarantor or
become a Guarantor;

     (e) Dispositions permitted by SECTION 7.04;

     (f) other than as set forth on SCHEDULE 7.05,  non-exclusive licenses of IP
Rights in the ordinary course of business and substantially consistent with past
practice for terms not exceeding five years;

                                      S-75
<PAGE>

     (g)  Dispositions  by the  Borrower  and  its  Subsidiaries  not  otherwise
permitted  under  this  SECTION  7.05;  PROVIDED  that  (i) at the  time of such
Disposition,  no Default shall exist or would result from such  Disposition  and
(ii) the  aggregate  book value of all property  Disposed of in reliance on this
clause (g) in any fiscal year shall not exceed $2,000,000; and

     (h)  Dispositions  of the real  property  owned by the Loan  Parties on the
Closing Date and located in (i) Forrest City, Arkansas and (ii) Charlotte, North
Carolina.

     PROVIDED, HOWEVER, that any Disposition pursuant to clauses (a) through (h)
shall be for fair market value.

     7.06.  RESTRICTED  PAYMENTS.  Declare or make, directly or indirectly,  any
Restricted Payment, or incur any obligation  (contingent or otherwise) to do so,
except that,  so long as no Default shall have occurred and be continuing at the
time of any action described below or would result therefrom:

     (a) each  Subsidiary  may make  Restricted  Payments to the  Borrower,  the
Guarantors and any other Person that owns an Equity Interest in such Subsidiary,
ratably according to their respective holdings of the type of Equity Interest in
respect of which such Restricted Payment is being made;

     (b) the Borrower and each Subsidiary may declare and make dividend payments
or other distributions payable solely in the common stock or other common Equity
Interests of such Person;

     (c) the  Borrower and each  Subsidiary  may  purchase,  redeem or otherwise
acquire  Equity  Interests  issued  by it with the  proceeds  received  from the
substantially concurrent issue of new shares of its common stock or other common
Equity Interests;

     (d) payments with respect to any intercompany  loan permitted under SECTION
7.03(G);

     (e) the Borrower may (i) declare or pay cash dividends to its  stockholders
and (ii) purchase,  redeem or otherwise acquire for cash Equity Interests issued
by it so long as, in each case,  after giving  effect  thereto (A) no Default or
Event of Default has occurred and is  continuing  or would result  therefrom and
(B) the aggregate amount of such dividends, purchases, redemptions,  retirements
and  acquisitions  paid or made during any calendar year would not exceed 25% of
Consolidated Net Income for such year;

     (f) the Borrower may make (i) so long as no Default or Event of Default has
occurred  and is  continuing  or would  result  therefrom,  regularly  scheduled
payments of  interest  (but not  principal  or premium) in respect of the Senior
Subordinated Notes and Additional Subordinated  Indebtedness on the dates and in
the amounts set forth in the  applicable  Subordinated  Note Documents or in the
documents evidencing the Additional Subordinated  Indebtedness,  as the case may
be, and (ii)  prepayments  or  purchases  of  principal in respect of the Senior
Subordinated Notes or Additional  Subordinated  Indebtedness,  so long as (A) no
Default or Event of Default  has  occurred  and is  continuing  or would  result
therefrom,  (B) the Fixed Charge  Coverage Ratio as of the fiscal quarter of the

                                      S-76
<PAGE>

Borrower most recently then ended  (calculated on a pro forma basis after giving
effect  to the  making of such  prepayment  or  purchase)  will not be less than
1.25:1,  (C)  the  Borrower  has  provided  the  Administrative   Agent  with  a
certificate no later than the date of such payment  evidencing  compliance  with
the  requirements  set forth in the  foregoing  clauses  (A) and (B) and (D) the
amount of such  prepayments  in  respect of the  Senior  Subordinated  Notes and
Additional  Subordinated  Indebtedness  shall  not  exceed  $50,000,000  in  the
aggregate from and after the Closing Date; and

     (g) the Borrower may make (i) regularly scheduled payments of interest (but
not principal or premium) in respect of the Senior Notes on the dates and in the
amounts set forth in the applicable  Senior Note  Documents,  as the case may be
and (ii)  prepayments  or purchases of principal in respect of the Senior Notes,
so long as no Default or Event of Default  has  occurred  and is  continuing  or
would result therefrom, which such prepayments may be made, but are not required
to be made, with the proceeds of Additional Subordinated Indebtedness.

     7.07. CHANGE IN NATURE OF BUSINESS. Engage in any material line of business
substantially  different from those lines of business  conducted by the Borrower
and its Subsidiaries on the date hereof or any business substantially related or
incidental thereto.

     7.08. TRANSACTIONS WITH AFFILIATES.  Enter into any transaction of any kind
with any  Affiliate of the  Borrower,  whether or not in the ordinary  course of
business,  other than on fair and reasonable terms substantially as favorable to
the Borrower or such  Subsidiary  as would be obtainable by the Borrower or such
Subsidiary at the time in a comparable  arm's length  transaction  with a Person
other than an Affiliate.

     7.09.  BURDENSOME  AGREEMENTS.  Except as set forth on SCHEDULE 7.09, enter
into any  Contractual  Obligation  (other than this  Agreement or any other Loan
Document) that (a) limits the ability (i) of any  Subsidiary to make  Restricted
Payments to the Borrower or any Guarantor or to otherwise  transfer  property to
the  Borrower  or  any  Guarantor,  (ii)  of any  Subsidiary  to  Guarantee  the
Indebtedness  of the  Borrower  or (iii) of the  Borrower or any  Subsidiary  to
create,  incur,  assume or suffer to exist  Liens on  property  of such  Person;
PROVIDED, HOWEVER, that this clause (iii) shall not prohibit any negative pledge
incurred  or  provided in favor of any holder of  Indebtedness  permitted  under
SECTION  7.03(E)  solely to the extent any such negative  pledge  relates to the
property  financed by or the subject of such  Indebtedness;  or (b) requires the
grant of a Lien to secure an  obligation  of such Person if a Lien is granted to
secure another obligation of such Person.

     7.10. USE OF PROCEEDS.  Use the proceeds of any Credit  Extension,  whether
directly or indirectly, and whether immediately,  incidentally or ultimately, to
purchase or carry margin stock  (within the meaning of  Regulation U of the FRB)
or to extend credit to others for the purpose of  purchasing or carrying  margin
stock or to refund indebtedness originally incurred for such purpose.

     7.11. FINANCIAL COVENANTS.

     (a) MINIMUM FIXED CHARGE COVERAGE  RATIO.  Permit the Fixed Charge Coverage
Ratio at any time during any period of four  consecutive  fiscal quarters of the
Borrower to be less than 1.25:1.

                                      S-77
<PAGE>

     (b) MAXIMUM SENIOR LEVERAGE RATIO.  Permit the Senior Leverage Ratio at any
time during any period of four consecutive fiscal quarters of the Borrower to be
greater than 3.00:1.

     7.12.  MODIFICATIONS  OF CERTAIN  DOCUMENTS;  DESIGNATION  OF SENIOR  DEBT.
Consent  to  any  amendment  or  modification  of or  supplement  to  any of the
provisions  of any  documents or  agreements  evidencing or governing the Senior
Subordinated Notes, any other existing  Indebtedness set forth on SCHEDULE 7.03,
or the Senior Notes.  The Loan Parties will  designate the Credit  Agreement and
the Obligations  hereunder as "Designated Senior  Indebtedness" under the Senior
Subordinated Note Indenture, and will not designate any other Indebtedness other
than the Senior Notes as "Designated Senior Debt" under the Senior  Subordinated
Note  Indenture.  The Loan Parties will  designate the Credit  Agreement and the
Obligations  hereunder as "Senior Indebtedness" under the Senior Note Indenture,
and will not designate any other Indebtedness as "Senior Indebtedness" under the
Senior Note Indenture.

     7.13. SALE-LEASEBACK  TRANSACTIONS.  Directly or indirectly, enter into any
arrangements  with any Person  whereby  such Person  shall sell or transfer  (or
request another Person to purchase) any property,  real, personal or mixed, used
or  useful  in its  business,  whether  now  owned or  hereafter  acquired,  and
thereafter rent or lease such property from any Person.

                                 ARTICLE VIII.
                         EVENTS OF DEFAULT AND REMEDIES

     8.01. EVENTS OF DEFAULT.  Any of the following shall constitute an Event of
Default:

     (a) NON-PAYMENT. The Borrower or any other Loan Party fails to pay (i) when
and as required to be paid  herein,  any amount of  principal of any Loan or any
L/C  Obligation,  or (ii)  within  three days after the same  becomes  due,  any
interest on any Loan or on any L/C Obligation, or any fee due hereunder or (iii)
within five days after the same becomes due, any other amount payable  hereunder
or under any other Loan Document; or

     (b) SPECIFIC COVENANTS.  The Borrower fails to perform or observe any term,
covenant or agreement  contained in any of SECTION 6.01, 6.02, 6.03, 6.05, 6.06,
6.07, 6.10, 6.11, 6.12 or 6.13 or ARTICLE VII; or

     (c) OTHER  DEFAULTS.  Any Loan Party  fails to perform or observe any other
covenant or agreement (not  specified in subsection (a) or (b) above)  contained
in any Loan  Document on its part to be  performed  or observed and such failure
continues for 30 days; or

     (d)   REPRESENTATIONS  AND  WARRANTIES.   Any   representation,   warranty,
certification  or  statement  of fact made or deemed made by or on behalf of the
Borrower or any other Loan Party herein,  in any other Loan Document,  or in any
document  delivered in  connection  herewith or therewith  shall be incorrect or
misleading when made or deemed made; or

     (e) CROSS-DEFAULT. (i) The Borrower or any Subsidiary (A) fails to make any
payment  when  due  (whether  by  scheduled   maturity,   required   prepayment,
acceleration,  demand,  or  otherwise)  in  respect of any (x)  Indebtedness  or
Guarantee  (other  than  Indebtedness  hereunder  and  Indebtedness  under  Swap

                                      S-78
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Contracts) having an aggregate  principal amount (including undrawn committed or
available  amounts  and  including  amounts  owing to all  creditors  under  any
combined or syndicated credit arrangement) of more than the Threshold Amount, or
(y)  Material  Rental  Obligation,  (B) fails to observe  or  perform  any other
agreement  or  condition  relating  to any such  Indebtedness,  Material  Rental
Obligation or Guarantee or contained in any instrument or agreement  evidencing,
securing or relating  thereto,  or any other event  occurs,  the effect of which
default or other  event is to (x)  cause,  or to permit the holder or holders of
such  Indebtedness or the beneficiary or  beneficiaries  of such Material Rental
Obligation  or  Guarantee  (or a trustee  or agent on  behalf of such  holder or
holders or beneficiary or beneficiaries) (y) cause, with the giving of notice if
required,  such  Indebtedness or Material Rental Obligation to be demanded or to
become due or to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise),  or  an  offer  to  repurchase,   prepay,  defease  or  redeem  such
Indebtedness  to be made,  prior to its stated  maturity,  or such  Guarantee to
become payable or cash collateral in respect thereof to be demanded or (z) cause
or permit  the lease with  respect  to any  Material  Rental  Obligation  of the
Borrower or any of its  Subsidiaries  to be  terminated  prior to its  scheduled
expiration  date;  or (ii)  there  occurs  under  any  Swap  Contract  an  Early
Termination Date (as defined in such Swap Contract) resulting from (A) any event
of default under such Swap  Contract as to which the Borrower or any  Subsidiary
is the  Defaulting  Party  (as  defined  in  such  Swap  Contract)  or  (B)  any
Termination  Event (as so  defined)  under  such Swap  Contract  as to which the
Borrower or any  Subsidiary is an Affected  Party (as so defined) and, in either
event, the Swap  Termination  Value owed by the Borrower or such Subsidiary as a
result thereof is greater than the Threshold Amount; or

     (f) INSOLVENCY PROCEEDINGS,  ETC. Any Loan Party or any of its Subsidiaries
institutes or consents to the  institution  of any  proceeding  under any Debtor
Relief Law, or makes an assignment for the benefit of creditors;  or applies for
or consents to the appointment of any receiver, trustee, custodian, conservator,
liquidator,  rehabilitator  or similar officer for it or for all or any material
part  of  its  property;  or  any  receiver,  trustee,  custodian,  conservator,
liquidator,   rehabilitator   or  similar  officer  is  appointed   without  the
application or consent of such Person and the appointment continues undischarged
or unstayed for 60 calendar days; or any proceeding  under any Debtor Relief Law
relating to any such Person or to all or any  material  part of its  property is
instituted  without  the  consent of such Person and  continues  undismissed  or
unstayed  for 60  calendar  days,  or an order for relief is entered in any such
proceeding; or

     (g) INABILITY TO PAY DEBTS; ATTACHMENT.  (i) The Borrower or any Subsidiary
becomes unable or admits in writing its inability or fails  generally to pay its
debts as they become due, or (ii) any writ or warrant of attachment or execution
or similar  process is issued or levied  against all or any material part of the
property of any such Person and is not released,  vacated or fully bonded within
30 days after its issue or levy; or

     (h) JUDGMENTS.  There is entered against the Borrower or any Subsidiary (i)
one or more final  judgments  or orders for the payment of money in an aggregate
amount (as to all such judgments or orders)  exceeding the Threshold  Amount (to
the extent not covered by CM Insurance Company, Inc. or independent  third-party
insurance as to which CM Insurance Company, Inc. or such third-party insurer, as
the  case  may  be,  does  not  dispute  coverage),  or  (ii)  any  one or  more
non-monetary final judgments that have, or could reasonably be expected to have,

                                      S-79
<PAGE>

individually or in the aggregate, a Material Adverse Effect and, in either case,
(A) enforcement  proceedings are commenced by any creditor upon such judgment or
order,  or (B) there is a period of 30  consecutive  days during which a stay of
enforcement of such judgment, by reason of a pending appeal or otherwise, is not
in effect; or

     (i) ERISA.  (i) An ERISA  Event  occurs with  respect to a Pension  Plan or
Multiemployer  Plan which has resulted or could reasonably be expected to result
in  liability  of the  Borrower  under  Title IV of ERISA to the  Pension  Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of the Threshold
Amount, or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after
the  expiration of any applicable  grace period,  any  installment  payment with
respect  to its  withdrawal  liability  under  Section  4201  of  ERISA  under a
Multiemployer Plan in an aggregate amount in excess of the Threshold Amount;

     (j) INVALIDITY OF LOAN  DOCUMENTS.  Any provision of any Loan Document,  at
any time after its  execution  and  delivery  and for any  reason  other than as
expressly  permitted  hereunder or thereunder or satisfaction in full of all the
Obligations,  ceases to be in full  force and  effect;  or any Loan Party or any
other  Person  contests  in any manner the  validity  or  enforceability  of any
provision  of any Loan  Document;  or any Loan Party  denies  that it has any or
further liability or obligation under any Loan Document,  or purports to revoke,
terminate or rescind any provision of any Loan Document; or

     (k) CHANGE OF CONTROL. There occurs any Change of Control; or

     (l) INVALIDITY OF LIENS.  Any of the following  shall occur:  (i) the Liens
created  hereunder  or under the other Loan  Documents  shall at any time (other
than by reason of the  Administrative  Agent  relinquishing  such Lien) cease to
constitute  valid and perfected  Liens on any Collateral  with an aggregate fair
market value in excess of $500,000 which is intended to be covered thereby other
than with the consent, in writing, of the Administrative  Agent; (ii) except for
expiration in accordance with its respective  terms, any Loan Document shall for
whatever  reason be  terminated,  or shall  cease to be in full force and effect
other than with the consent, in writing,  of the Administrative  Agent; or (iii)
the  enforceability  of any Loan Document  shall be contested by the Borrower or
any of its Subsidiaries.

     8.02. REMEDIES UPON EVENT OF DEFAULT. If any Event of Default occurs and is
continuing,  the Administrative Agent shall, at the request of, or may, with the
consent of, the Required Lenders, take any or all of the following actions:

     (a) declare the  commitment of each Lender to make Loans and any obligation
of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such
commitments and obligation shall be terminated;

     (b) declare  the unpaid  principal  amount of all  outstanding  Loans,  all
interest  accrued and unpaid  thereon,  and all other  amounts  owing or payable
hereunder or under any other Loan  Document to be  immediately  due and payable,
without presentment,  demand,  protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower;

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<PAGE>

     (c) require that the Borrower Cash Collateralize the L/C Obligations (in an
amount equal to the then Outstanding Amount thereof); and

     (d) exercise on behalf of itself, the Lenders and the L/C Issuer all rights
and  remedies  available  to it, the Lenders  and the L/C Issuer  under the Loan
Documents;

     PROVIDED, HOWEVER, that upon the occurrence of an actual or deemed entry of
an order for relief with respect to the Borrower  under the  Bankruptcy  Code of
the  United  States,  the  obligation  of  each  Lender  to make  Loans  and any
obligation of the L/C Issuer to make L/C Credit  Extensions shall  automatically
terminate, the unpaid principal amount of all outstanding Loans and all interest
and other amounts as aforesaid shall automatically  become due and payable,  and
the  obligation of the Borrower to Cash  Collateralize  the L/C  Obligations  as
aforesaid shall automatically become effective, in each case without further act
of the Administrative Agent or any Lender.

     8.03.  APPLICATION OF FUNDS. After the exercise of remedies provided for in
SECTION 8.02 (or after the Loans have  automatically  become immediately due and
payable and the L/C  Obligations  have  automatically  been  required to be Cash
Collateralized  as set  forth in the  proviso  to  SECTION  8.02),  any  amounts
received on account of the  Obligations  shall be applied by the  Administrative
Agent in the following order:

     FIRST,  to payment of that portion of the  Obligations  constituting  fees,
indemnities,   expenses  and  other  amounts   (including   fees,   charges  and
disbursements of counsel to the  Administrative  Agent and amounts payable under
ARTICLE III) payable to the Administrative Agent in its capacity as such;

     SECOND,  to payment of that portion of the Obligations  constituting  fees,
indemnities  and other  amounts  (other than  principal,  interest and Letter of
Credit Fees) payable to the Lenders and the L/C Issuer (including fees,  charges
and  disbursements  of counsel to the respective  Lenders and the L/C Issuer and
amounts  payable  under  ARTICLE  III),  ratably among them in proportion to the
respective amounts described in this clause SECOND payable to them;

     THIRD, to payment of that portion of the Obligations  constituting  accrued
and unpaid Letter of Credit Fees and interest on the Loans,  L/C  Borrowings and
other Obligations, ratably among the Lenders and the L/C Issuer in proportion to
the respective amounts described in this clause THIRD payable to them;

     FOURTH,  to payment of that  portion of the  Obligations  constituting  (i)
overdraft obligations,  fees, costs, charges,  expenses and other obligations in
respect  of  any  Swap  Contract,   cash  management  agreement  (including  ACH
transactions),  operating or deposit account, or other banking product from time
to time made available to the Loan Parties or any of their  Subsidiaries  by the
Administrative  Agent, the L/C Issuer,  cash management service  providers,  any
Lender or any of their Affiliates and (ii) unpaid principal of the Loans and L/C
Borrowings,  ratably  among the Lenders and the L/C Issuer in  proportion to the
respective amounts described in this clause FOURTH held by them;

                                      S-81
<PAGE>

     FIFTH, to the  Administrative  Agent for the account of the L/C Issuer,  to
Cash  Collateralize  that portion of L/C Obligations  comprised of the aggregate
undrawn amount of Letters of Credit; and

     LAST,  the  balance,  if  any,  after  all of  the  Obligations  have  been
indefeasibly paid in full, to the Borrower or as otherwise required by Law.

     Subject  to  SECTION  2.03(C),  amounts  used  to  Cash  Collateralize  the
aggregate  undrawn  amount of Letters of Credit  pursuant to clause  FIFTH above
shall be applied to satisfy drawings under such Letters of Credit as they occur.
If any amount remains on deposit as Cash Collateral  after all Letters of Credit
have either been fully drawn or expired,  such remaining amount shall be applied
to the other Obligations, if any, in the order set forth above.

                                  ARTICLE IX.
                              ADMINISTRATIVE AGENT

     9.01.  APPOINTMENT  AND  AUTHORITY.  Each of the Lenders and the L/C Issuer
hereby  irrevocably  appoints  Bank  of  America  to act on  its  behalf  as the
Administrative Agent hereunder and under the other Loan Documents and authorizes
the Administrative Agent to take such actions on its behalf and to exercise such
powers as are  delegated  to the  Administrative  Agent by the  terms  hereof or
thereof,  together  with such  actions and powers as are  reasonably  incidental
thereto.  The  provisions  of this  Article  are solely  for the  benefit of the
Administrative  Agent, the Lenders and the L/C Issuer,  and neither the Borrower
nor any other Loan Party shall have rights as a third party  beneficiary  of any
of such provisions.

     9.02. RIGHTS AS A LENDER.  The Person serving as the  Administrative  Agent
hereunder  shall have the same rights and powers in its  capacity as a Lender as
any  other  Lender  and  may  exercise  the  same  as  though  it  were  not the
Administrative  Agent and the term "Lender" or "Lenders" shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative Agent hereunder in its individual  capacity.  Such
Person and its  Affiliates may accept  deposits from,  lend money to, act as the
financial  advisor or in any other advisory capacity for and generally engage in
any kind of business  with the  Borrower or any  Subsidiary  or other  Affiliate
thereof  as if such  Person  were not the  Administrative  Agent  hereunder  and
without any duty to account therefor to the Lenders.

     9.03. EXCULPATORY  PROVISIONS.  The Administrative Agent shall not have any
duties or obligations  except those  expressly set forth herein and in the other
Loan  Documents.   Without  limiting  the  generality  of  the  foregoing,   the
Administrative Agent:

     (a)  shall  not be  subject  to any  fiduciary  or  other  implied  duties,
regardless of whether a Default has occurred and is continuing;

     (b) shall not have any duty to take any  discretionary  action or  exercise
any  discretionary  powers,  except  discretionary  rights and powers  expressly
contemplated hereby or by the other Loan Documents that the Administrative Agent
is required to exercise as directed in writing by the Required  Lenders (or such
other number or  percentage  of the Lenders as shall be  expressly  provided for
herein or in the other Loan Documents),  PROVIDED that the Administrative  Agent

                                      S-82
<PAGE>

shall not be required to take any action that,  in its opinion or the opinion of
its  counsel,  may  expose  the  Administrative  Agent to  liability  or that is
contrary to any Loan Document or applicable law; and

     (c) shall not,  except as expressly  set forth herein and in the other Loan
Documents, have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to the Borrower or any of its Affiliates that
is communicated to or obtained by the Person serving as the Administrative Agent
or any of its Affiliates in any capacity.

     The  Administrative  Agent shall not be liable for any action  taken or not
taken by it (i) with the consent or at the request of the  Required  Lenders (or
such other number or percentage of the Lenders as shall be necessary,  or as the
Administrative  Agent shall believe in good faith shall be necessary,  under the
circumstances  as provided in SECTIONS 10.01 and 8.02) or (ii) in the absence of
its own gross negligence or willful misconduct.  The Administrative  Agent shall
be  deemed  not to  have  knowledge  of any  Default  unless  and  until  notice
describing such Default is given to the Administrative  Agent by the Borrower, a
Lender or the L/C Issuer.

     The  Administrative  Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement,  warranty or representation made in
or in  connection  with this  Agreement  or any other  Loan  Document,  (ii) the
contents of any  certificate,  report or other document  delivered  hereunder or
thereunder or in  connection  herewith or therewith,  (iii) the  performance  or
observance of any of the covenants,  agreements or other terms or conditions set
forth herein or therein or the  occurrence  of any Default,  (iv) the  validity,
enforceability,  effectiveness or genuineness of this Agreement,  any other Loan
Document or any other agreement,  instrument or document or (v) the satisfaction
of any  condition  set forth in ARTICLE IV or  elsewhere  herein,  other than to
confirm   receipt  of  items   expressly   required  to  be   delivered  to  the
Administrative Agent.

     9.04. RELIANCE BY ADMINISTRATIVE  AGENT. The Administrative  Agent shall be
entitled to rely upon,  and shall not incur any liability for relying upon,  any
notice, request, certificate,  consent, statement, instrument, document or other
writing (including any electronic message,  Internet or intranet website posting
or other  distribution)  believed by it to be genuine  and to have been  signed,
sent or otherwise  authenticated by the proper Person. The Administrative  Agent
also may rely upon any statement  made to it orally or by telephone and believed
by it to have been made by the proper Person,  and shall not incur any liability
for relying thereon.  In determining  compliance with any condition hereunder to
the making of a Loan,  or the issuance of a Letter of Credit,  that by its terms
must be  fulfilled  to the  satisfaction  of a  Lender  or the L/C  Issuer,  the
Administrative  Agent may presume that such  condition is  satisfactory  to such
Lender or the L/C Issuer  unless the  Administrative  Agent shall have  received
notice to the contrary from such Lender or the L/C Issuer prior to the making of
such Loan or the issuance of such Letter of Credit. The Administrative Agent may
consult with legal  counsel (who may be counsel for the  Borrower),  independent
accountants  and other  experts  selected by it, and shall not be liable for any
action  taken or not  taken by it in  accordance  with  the  advice  of any such
counsel, accountants or experts.

     9.05.  DELEGATION OF DUTIES. The  Administrative  Agent may perform any and
all of its duties and  exercise  its  rights and powers  hereunder  or under any

                                      S-83
<PAGE>

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

     9.06.  RESIGNATION OF ADMINISTRATIVE AGENT. The Administrative Agent may at
any time give notice of its  resignation to the Lenders,  the L/C Issuer and the
Borrower.  Upon receipt of any such notice of resignation,  the Required Lenders
shall have the right, in consultation with the Borrower, to appoint a successor,
which shall be a bank with an office in the United  States,  or an  Affiliate of
any such bank with an office in the United States.  If no such  successor  shall
have been so  appointed  by the Required  Lenders and shall have  accepted  such
appointment within 30 days after the retiring  Administrative Agent gives notice
of its resignation,  then the retiring Administrative Agent may on behalf of the
Lenders and the L/C Issuer, appoint a successor Administrative Agent meeting the
qualifications set forth above;  PROVIDED that if the Administrative Agent shall
notify the Borrower and the Lenders that no qualifying  Person has accepted such
appointment,  then  such  resignation  shall  nonetheless  become  effective  in
accordance with such notice and (1) the retiring  Administrative  Agent shall be
discharged  from its duties and  obligations  hereunder and under the other Loan
Documents  (except  that in the  case  of any  collateral  security  held by the
Administrative Agent on behalf of the Lenders or the L/C Issuer under any of the
Loan Documents,  the retiring  Administrative  Agent shall continue to hold such
collateral  security  until  such time as a  successor  Administrative  Agent is
appointed) and (2) all payments,  communications and determinations  provided to
be made by, to or through the  Administrative  Agent shall instead be made by or
to each  Lender and the L/C  Issuer  directly,  until such time as the  Required
Lenders appoint a successor  Administrative  Agent as provided for above in this
Section.  Upon the  acceptance of a successor's  appointment  as  Administrative
Agent  hereunder,  such successor shall succeed to and become vested with all of
the  rights,  powers,  privileges  and  duties  of  the  retiring  (or  retired)
Administrative Agent, and the retiring  Administrative Agent shall be discharged
from all of its  duties  and  obligations  hereunder  or under  the  other  Loan
Documents  (if not  already  discharged  therefrom  as  provided  above  in this
Section).  The fees payable by the Borrower to a successor  Administrative Agent
shall be the same as those payable to its predecessor  unless  otherwise  agreed
between the  Borrower  and such  successor.  After the  retiring  Administrative
Agent's resignation hereunder and under the other Loan Documents, the provisions
of this  Article and SECTION  10.04 shall  continue in effect for the benefit of
such retiring  Administrative Agent, its sub-agents and their respective Related
Parties in respect  of any  actions  taken or omitted to be taken by any of them
while the retiring Administrative Agent was acting as Administrative Agent.

     Any resignation by Bank of America as Administrative Agent pursuant to this
Section  shall  also  constitute  its  resignation  as L/C Issuer and Swing Line
Lender. Upon the acceptance of a successor's appointment as Administrative Agent
hereunder, (a) such successor shall succeed to and become vested with all of the
rights, powers,  privileges and duties of the retiring L/C Issuer and Swing Line
Lender,  (b) the retiring  L/C Issuer and Swing Line Lender shall be  discharged
from all of their respective duties and obligations hereunder or under the other
Loan  Documents,  and (c) the successor L/C Issuer shall issue letters of credit

                                      S-84
<PAGE>

in substitution  for the Letters of Credit,  if any,  outstanding at the time of
such  succession  or make other  arrangements  satisfactory  to the retiring L/C
Issuer to  effectively  assume the  obligations  of the retiring L/C Issuer with
respect to such Letters of Credit.

     9.07.  NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.  Each Lender
and the L/C Issuer acknowledges that it has,  independently and without reliance
upon  the  Administrative  Agent or any  other  Lender  or any of their  Related
Parties  and  based  on  such  documents  and   information  as  it  has  deemed
appropriate,  made its own  credit  analysis  and  decision  to enter  into this
Agreement.  Each  Lender  and the L/C  Issuer  also  acknowledges  that it will,
independently  and without reliance upon the  Administrative  Agent or any other
Lender  or any of  their  Related  Parties  and  based  on  such  documents  and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan  Document  or any related  agreement  or any  document  furnished
hereunder or thereunder.

     9.08.   NO  OTHER   DUTIES,   ETC.   Anything   herein   to  the   contrary
notwithstanding,  none of the Bookrunners or Arrangers  listed on the cover page
hereof shall have any powers, duties or responsibilities under this Agreement or
any of the other Loan Documents,  except in its capacity, as applicable,  as the
Administrative Agent, a Lender or the L/C Issuer hereunder.

     9.09.  ADMINISTRATIVE  AGENT  MAY  FILE  PROOFS  OF  CLAIM.  In case of the
pendency of any  proceeding  under any Debtor  Relief Law or any other  judicial
proceeding relative to any Loan Party, the Administrative Agent (irrespective of
whether  the  principal  of any  Loan or L/C  Obligation  shall  then be due and
payable as herein  expressed or by declaration or otherwise and  irrespective of
whether the  Administrative  Agent  shall have made any demand on the  Borrower)
shall be entitled and empowered, by intervention in such proceeding or otherwise

     (a) to file and  prove a claim for the whole  amount of the  principal  and
interest owing and unpaid in respect of the Loans, L/C Obligations and all other
Obligations that are owing and unpaid and to file such other documents as may be
necessary  or  advisable  in order to have the  claims of the  Lenders,  the L/C
Issuer and the  Administrative  Agent  (including  any claim for the  reasonable
compensation,  expenses,  disbursements  and  advances of the  Lenders,  the L/C
Issuer and the Administrative  Agent and their respective agents and counsel and
all other amounts due the Lenders,  the L/C Issuer and the Administrative  Agent
under  SECTIONS  2.03(I)  and (J),  2.09 and  10.04)  allowed  in such  judicial
proceeding; and

     (b) to  collect  and  receive  any  monies  or other  property  payable  or
deliverable on any such claims and to distribute the same;

     and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial  proceeding is hereby  authorized by
each Lender and the L/C Issuer to make such payments to the Administrative Agent
and, in the event that the  Administrative  Agent shall consent to the making of
such  payments  directly  to the  Lenders  and  the  L/C  Issuer,  to pay to the
Administrative Agent any amount due for the reasonable  compensation,  expenses,
disbursements  and  advances  of the  Administrative  Agent and its  agents  and
counsel,  and any other amounts due the Administrative Agent under SECTIONS 2.09
and 10.04.

                                      S-85
<PAGE>

     Nothing  contained  herein shall be deemed to authorize the  Administrative
Agent to  authorize  or consent to or accept or adopt on behalf of any Lender or
the  L/C  Issuer  any  plan  of  reorganization,   arrangement,   adjustment  or
composition  affecting  the  Obligations  or the rights of any Lender or the L/C
Issuer to authorize the Administrative  Agent to vote in respect of the claim of
any Lender or the L/C Issuer in any such proceeding.

     9.10.  COLLATERAL  AND  GUARANTY  MATTERS.  The  Lenders and the L/C Issuer
irrevocably  authorize  the  Administrative  Agent,  at  its  option  and in its
discretion,

     (a) to  release  any  Lien  on  any  property  granted  to or  held  by the
Administrative  Agent  under  any  Loan  Document  (i) upon  termination  of the
Aggregate  Commitments  and  payment  in full  of all  Obligations  (other  than
contingent indemnification obligations) and the expiration or termination of all
Letters of Credit,  (ii) that is sold or to be sold as part of or in  connection
with any sale  permitted  hereunder or under any other Loan  Document,  or (iii)
subject to SECTION 10.01, if approved,  authorized or ratified in writing by the
Required Lenders or otherwise permitted under this Agreement;

     (b) to  subordinate  any  Lien on any  property  granted  to or held by the
Administrative  Agent under any Loan  Document to the holder of any Lien on such
property that is permitted by SECTION 7.01(I); and

     (c) to release any  Guarantor  from its  obligations  under the Guaranty if
such Person  ceases to be a Subsidiary  as a result of a  transaction  permitted
hereunder.

     Upon request by the Administrative  Agent at any time, the Required Lenders
will  confirm in writing  the  Administrative  Agent's  authority  to release or
subordinate its interest in particular types or items of property, or to release
any Guarantor from its obligations  under the Guaranty  pursuant to this SECTION
9.10.

     9.11.  INTERCREDITOR AGREEMENT. The Lenders hereby agree to be bound by the
terms of the Intercreditor Agreement.

                                   ARTICLE X.
                                  MISCELLANEOUS

     10.01.  AMENDMENTS,  ETC. No amendment  or waiver of any  provision of this
Agreement  or any other Loan  Document,  and no consent to any  departure by the
Borrower or any other Loan Party therefrom, shall be effective unless in writing
signed by the Required Lenders and the Borrower or the applicable Loan Party, as
the case may be, and  acknowledged by the  Administrative  Agent,  and each such
waiver or consent shall be effective  only in the specific  instance and for the
specific  purpose for which given;  PROVIDED,  HOWEVER,  that no such amendment,
waiver or consent shall:

     (a) waive any  condition set forth in SECTION  4.01(A)  without the written
consent of each Lender;

                                      S-86
<PAGE>

     (b) extend or  increase  the  Commitment  of any Lender (or  reinstate  any
Commitment  terminated  pursuant to SECTION 8.02) without the written consent of
such Lender;

     (c)  postpone any date fixed by this  Agreement or any other Loan  Document
for any payment (excluding mandatory prepayments) of principal,  interest,  fees
or other  amounts  due to the Lenders  (or any of them)  hereunder  or under any
other Loan Document without the written consent of each Lender directly affected
thereby;

     (d) reduce the principal of, or the rate of interest  specified  herein on,
any Loan or L/C  Borrowing,  or (subject to clause (v) of the second  proviso to
this SECTION  10.01) any fees or other  amounts  payable  hereunder or under any
other Loan Document without the written consent of each Lender directly affected
thereby; PROVIDED,  HOWEVER, that only the consent of the Required Lenders shall
be  necessary  (i) to amend the  definition  of  "Default  Rate" or to waive any
obligation  of the  Borrower  to pay  interest  or Letter of Credit  Fees at the
Default Rate or (ii) to amend any financial  covenant  hereunder (or any defined
term used therein) even if the effect of such  amendment  would be to reduce the
rate of  interest  on any Loan or L/C  Borrowing  or to reduce  any fee  payable
hereunder;

     (e) change  SECTION  2.13 or SECTION  8.03 in a manner that would alter the
pro rata sharing of payments  required  thereby  without the written  consent of
each Lender;

     (f) change any  provision  of this Section or the  definition  of "Required
Lenders" or any other  provision  hereof  specifying the number or percentage of
Lenders  required to amend,  waive or otherwise  modify any rights  hereunder or
make any  determination  or grant any  consent  hereunder  without  the  written
consent of each Lender;

     (g) release all or  substantially  all of the value of the Guaranty without
the written consent of each Lender; or

     (h) release all or  substantially  all of the Collateral in any transaction
or series of related transactions;

     and,  PROVIDED  FURTHER,  that (i) no amendment,  waiver or consent  shall,
unless in  writing  and  signed by the L/C  Issuer in  addition  to the  Lenders
required  above,  affect  the  rights  or duties of the L/C  Issuer  under  this
Agreement or any Issuer  Document  relating to any Letter of Credit issued or to
be issued by it; (ii) no amendment,  waiver or consent shall,  unless in writing
and signed by the Swing Line Lender in addition to the Lenders  required  above,
affect the rights or duties of the Swing Line Lender under this Agreement; (iii)
no  amendment,  waiver or consent  shall,  unless in  writing  and signed by the
Administrative  Agent in  addition  to the Lenders  required  above,  affect the
rights or duties of the  Administrative  Agent under this Agreement or any other
Loan  Document;  (iv) SECTION  10.06(H) may not be amended,  waived or otherwise
modified  without the consent of each  Granting  Lender all or any part of whose
Loans are being funded by an SPC at the time of such amendment,  waiver or other
modification;  and (v) the Fee Letter may be  amended,  or rights or  privileges
thereunder   waived,  in  a  writing  executed  only  by  the  parties  thereto.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment,  waiver or consent  hereunder,

                                      S-87
<PAGE>

except  that the  Commitment  of such  Lender may not be  increased  or extended
without the consent of such Lender.

     10.02. NOTICES; EFFECTIVENESS; ELECTRONIC COMMUNICATION.

     (a)   NOTICES   GENERALLY.   Except  in  the  case  of  notices  and  other
communications  expressly  permitted  to be given by  telephone  (and  except as
provided in subsection (b) below), all notices and other communications provided
for  herein  shall be in writing  and shall be  delivered  by hand or  overnight
courier service, mailed by certified or registered mail or sent by telecopier as
follows, and all notices and other communications  expressly permitted hereunder
to be given by telephone shall be made to the applicable  telephone  number,  as
follows:

          (i) if to the Borrower,  the  Administrative  Agent, the L/C Issuer or
     the Swing Line Lender, to the address,  telecopier number,  electronic mail
     address or telephone  number  specified for such Person on SCHEDULE  10.02;
     and

          (ii)  if to any  other  Lender,  to the  address,  telecopier  number,
     electronic mail address or telephone number specified in its Administrative
     Questionnaire.

     Notices sent by hand or overnight  courier service,  or mailed by certified
or registered  mail,  shall be deemed to have been given when received;  notices
sent by telecopier shall be deemed to have been given when sent (except that, if
not given during normal  business  hours for the  recipient,  shall be deemed to
have been given at the  opening of  business  on the next  business  day for the
recipient).  Notices delivered through  electronic  communications to the extent
provided  in  subsection  (b) below,  shall be  effective  as  provided  in such
subsection (b).

     (b)  ELECTRONIC  COMMUNICATIONS.  Notices and other  communications  to the
Lenders and the L/C Issuer hereunder may be delivered or furnished by electronic
communication  (including e-mail and Internet or intranet  websites) pursuant to
procedures  approved by the  Administrative  Agent,  PROVIDED that the foregoing
shall not apply to notices to any Lender or the L/C Issuer  pursuant  to ARTICLE
II  if  such  Lender  or  the  L/C  Issuer,  as  applicable,  has  notified  the
Administrative  Agent  that it is  incapable  of  receiving  notices  under such
Article by electronic  communication.  The Administrative  Agent or the Borrower
may, in its discretion,  agree to accept notices and other  communications to it
hereunder by electronic  communications  pursuant to procedures  approved by it,
PROVIDED that approval of such  procedures may be limited to particular  notices
or communications.

     Unless the Administrative Agent otherwise prescribes, (i) notices and other
communications  sent to an  e-mail  address  shall be deemed  received  upon the
sender's receipt of an  acknowledgement  from the intended recipient (such as by
the "return receipt requested"  function,  as available,  return e-mail or other
written acknowledgement), PROVIDED that if such notice or other communication is
not sent  during the normal  business  hours of the  recipient,  such  notice or
communication  shall be deemed to have been sent at the  opening of  business on
the next  business day for the  recipient,  and (ii)  notices or  communications
posted to an Internet  or intranet  website  shall be deemed  received  upon the
deemed  receipt by the intended  recipient at its e-mail address as described in
the foregoing  clause (i) of notification  that such notice or  communication is
available and identifying the website address therefor.

                                      S-88
<PAGE>

     (c) THE PLATFORM.  THE PLATFORM IS PROVIDED "AS IS" AND "AS AVAILABLE." THE
AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR  COMPLETENESS OF
THE BORROWER  MATERIALS OR THE ADEQUACY OF THE PLATFORM,  AND EXPRESSLY DISCLAIM
LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF
ANY  KIND,   EXPRESS,   IMPLIED  OR   STATUTORY,   INCLUDING   ANY  WARRANTY  OF
MERCHANTABILITY,  FITNESS FOR A PARTICULAR  PURPOSE,  NON-INFRINGEMENT  OF THIRD
PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT
PARTY IN CONNECTION  WITH THE BORROWER  MATERIALS OR THE  PLATFORM.  In no event
shall the Administrative Agent or any of its Related Parties (collectively,  the
"AGENT PARTIES") have any liability to the Borrower,  any Lender, the L/C Issuer
or any other Person for losses, claims, damages,  liabilities or expenses of any
kind (whether in tort,  contract or otherwise)  arising out of the Borrower's or
the  Administrative  Agent's  transmission  of  Borrower  Materials  through the
Internet, except to the extent that such losses, claims, damages, liabilities or
expenses  are  determined  by a court of competent  jurisdiction  by a final and
nonappealable  judgment to have  resulted  from the gross  negligence or willful
misconduct of such Agent Party;  PROVIDED,  HOWEVER,  that in no event shall any
Agent Party have any  liability to the Borrower,  any Lender,  the L/C Issuer or
any other Person for indirect,  special,  incidental,  consequential or punitive
damages (as opposed to direct or actual damages).

     (d) CHANGE OF ADDRESS, ETC. Each of the Borrower, the Administrative Agent,
the L/C Issuer and the Swing Line Lender may change its address,  telecopier  or
telephone number for notices and other communications hereunder by notice to the
other parties  hereto.  Each other Lender may change its address,  telecopier or
telephone number for notices and other communications hereunder by notice to the
Borrower, the Administrative Agent, the L/C Issuer and the Swing Line Lender. In
addition,  each Lender  agrees to notify the  Administrative  Agent from time to
time to ensure  that the  Administrative  Agent has on record  (i) an  effective
address,  contact name, telephone number,  telecopier number and electronic mail
address to which notices and other  communications may be sent and (ii) accurate
wire instructions for such Lender.

     (e)  RELIANCE  BY  ADMINISTRATIVE   AGENT,  L/C  ISSUER  AND  LENDERS.  The
Administrative  Agent,  the L/C Issuer and the Lenders shall be entitled to rely
and act upon any notices (including  telephonic Committed Loan Notices and Swing
Line Loan Notices) purportedly given by or on behalf of the Borrower even if (i)
such notices were not made in a manner specified herein, were incomplete or were
not preceded or followed by any other form of notice specified  herein,  or (ii)
the terms thereof, as understood by the recipient,  varied from any confirmation
thereof. The Borrower shall indemnify the Administrative  Agent, the L/C Issuer,
each  Lender and the  Related  Parties of each of them from all  losses,  costs,
expenses  and  liabilities  resulting  from the  reliance by such Person on each
notice purportedly given by or on behalf of the Borrower. All telephonic notices
to and other  telephonic  communications  with the  Administrative  Agent may be
recorded by the  Administrative  Agent,  and each of the parties  hereto  hereby
consents to such recording.

     10.03. NO WAIVER;  CUMULATIVE  REMEDIES.  No failure by any Lender, the L/C
Issuer or the Administrative Agent to exercise,  and no delay by any such Person

                                      S-89
<PAGE>

in exercising,  any right, remedy, power or privilege hereunder shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege  hereunder  preclude any other or further exercise thereof or
the  exercise  of any other  right,  remedy,  power or  privilege.  The  rights,
remedies, powers and privileges herein provided are cumulative and not exclusive
of any rights, remedies, powers and privileges provided by law.

     10.04. EXPENSES; INDEMNITY; DAMAGE WAIVER.

     (a)  COSTS  AND  EXPENSES.  The  Borrower  shall  pay  (i)  all  reasonable
out-of-pocket  expenses incurred by the Administrative  Agent and its Affiliates
(including the reasonable  fees,  charges and  disbursements  of counsel for the
Administrative  Agent),  in  connection  with  the  syndication  of  the  credit
facilities  provided  for  herein,  the  preparation,   negotiation,  execution,
delivery and  administration  of this  Agreement and the other Loan Documents or
any  amendments,  modifications  or waivers of the provisions  hereof or thereof
(whether  or not the  transactions  contemplated  hereby  or  thereby  shall  be
consummated),  (ii) all reasonable  out-of-pocket  expenses  incurred by the L/C
Issuer in connection with the issuance,  amendment,  renewal or extension of any
Letter  of  Credit  or  any  demand  for  payment   thereunder   and  (iii)  all
out-of-pocket  expenses incurred by the Administrative  Agent, any Lender or the
L/C Issuer,  and shall pay all fees and time  charges for  attorneys  who may be
employees  of the  Administrative  Agent,  any  Lender  or the  L/C  Issuer,  in
connection  with the  enforcement  or protection of its rights (A) in connection
with this  Agreement  and the other Loan  Documents,  including its rights under
this  Section,  or (B) in  connection  with the Loans  made or Letters of Credit
issued hereunder,  including all such out-of-pocket expenses incurred during any
workout,  restructuring  or  negotiations in respect of such Loans or Letters of
Credit.

     (b)  INDEMNIFICATION  BY THE  BORROWER.  The Borrower  shall  indemnify the
Administrative  Agent  (and any  sub-agent  thereof),  each  Lender  and the L/C
Issuer, and each Related Party of any of the foregoing Persons (each such Person
being called an "INDEMNITEE")  against,  and hold each Indemnitee harmless from,
any and  all  losses,  costs  (including  settlement  costs),  claims,  damages,
liabilities and related expenses  (including the fees, charges and disbursements
of  any  counsel  (including  allocated  costs  of  internal  counsel)  for  any
Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees
and time charges and  disbursements  for  attorneys  who may be employees of any
Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any
third  party or by the  Borrower  or any other  Loan  Party  arising  out of, in
connection  with,  or as a  result  of (i) the  execution  or  delivery  of this
Agreement,  any other Loan Document or any agreement or instrument  contemplated
hereby or thereby,  the  performance by the parties  hereto of their  respective
obligations  hereunder  or  thereunder,  the  consummation  of the  transactions
contemplated hereby or thereby, or, in the case of the Administrative Agent (and
any sub-agent  thereof) and its Related Parties only, the administration of this
Agreement and the other Loan Documents, (ii) any Loan or Letter of Credit or the
use or proposed use of the proceeds therefrom  (including any refusal by the L/C
Issuer to honor a demand for payment  under a Letter of Credit if the  documents
presented in connection  with such demand do not strictly  comply with the terms
of such  Letter of Credit),  (iii) any actual or alleged  presence or release of
Hazardous Materials on or from any property owned or operated by the Borrower or
any of its Subsidiaries,  or any  Environmental  Liability related in any way to
the  Borrower  or any of its  Subsidiaries,  or (iv) any  actual or  prospective

                                      S-90
<PAGE>

claim, litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract,  tort or any other theory, whether brought by a third
party or by the Borrower or any other Loan Party,  and regardless of whether any
Indemnitee is a party thereto; PROVIDED that such indemnity shall not, as to any
Indemnitee,  be  available  to the extent  that such  losses,  claims,  damages,
liabilities  or related  expenses  (x) are  determined  by a court of  competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful  misconduct of such  Indemnitee or (y) result from a claim
brought by the Borrower or any other Loan Party against an Indemnitee for breach
in bad faith of such Indemnitee's  obligations hereunder or under any other Loan
Document,  if the  Borrower  or  such  Loan  Party  has  obtained  a  final  and
nonappealable  judgment in its favor on such claim as  determined  by a court of
competent jurisdiction.

     (c)  REIMBURSEMENT  BY  LENDERS.  To the extent that the  Borrower  for any
reason fails to indefeasibly pay any amount required under subsection (a) or (b)
of this Section to be paid by it to the  Administrative  Agent (or any sub-agent
thereof),  the L/C Issuer or any  Related  Party of any of the  foregoing,  each
Lender  severally  agrees  to pay to  the  Administrative  Agent  (or  any  such
sub-agent),  the L/C  Issuer or such  Related  Party,  as the case may be,  such
Lender's  Applicable  Percentage  (determined as of the time that the applicable
unreimbursed  expense or  indemnity  payment is sought) of such  unpaid  amount,
PROVIDED that the  unreimbursed  expense or  indemnified  loss,  claim,  damage,
liability  or related  expense,  as the case may be, was incurred by or asserted
against the  Administrative  Agent (or any such  sub-agent) or the L/C Issuer in
its  capacity  as such,  or against any  Related  Party of any of the  foregoing
acting for the  Administrative  Agent (or any such  sub-agent)  or L/C Issuer in
connection  with such  capacity.  The  obligations  of the  Lenders  under  this
subsection (c) are subject to the provisions of SECTION 2.12(D).

     (d) WAIVER OF CONSEQUENTIAL  DAMAGES,  ETC. To the fullest extent permitted
by applicable law, the Borrower shall not assert,  and hereby waives,  any claim
against any  Indemnitee,  on any theory of  liability,  for  special,  indirect,
consequential  or  punitive  damages  (as  opposed to direct or actual  damages)
arising out of, in connection with, or as a result of, this Agreement, any other
Loan  Document  or  any  agreement  or  instrument   contemplated   hereby,  the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or the
use of the proceeds thereof.  No Indemnitee  referred to in subsection (b) above
shall be liable for any damages arising from the use by unintended recipients of
any information or other materials  distributed to such unintended recipients by
such  Indemnitee  through  telecommunications,  electronic or other  information
transmission  systems  in  connection  with this  Agreement  or the  other  Loan
Documents  or the  transactions  contemplated  hereby or thereby  other than for
direct  or  actual  damages  resulting  from the  gross  negligence  or  willful
misconduct  of  such  Indemnitee  as  determined  by a final  and  nonappealable
judgment of a court of competent jurisdiction.

     (e) PAYMENTS. All amounts due under this Section shall be payable not later
than ten Business Days after demand therefor.

     (f) SURVIVAL.  The agreements in this Section shall survive the resignation
of the  Administrative  Agent,  the L/C Issuer and the Swing  Line  Lender,  the

                                      S-91
<PAGE>

replacement of any Lender, the termination of the Aggregate  Commitments and the
repayment, satisfaction or discharge of all the other Obligations.

     10.05.  PAYMENTS SET ASIDE.  To the extent that any payment by or on behalf
of the  Borrower  is made to the  Administrative  Agent,  the L/C  Issuer or any
Lender, or the Administrative  Agent, the L/C Issuer or any Lender exercises its
right of setoff,  and such  payment or the  proceeds  of such setoff or any part
thereof is subsequently invalidated,  declared to be fraudulent or preferential,
set aside or required  (including pursuant to any settlement entered into by the
Administrative  Agent,  the L/C Issuer or such Lender in its  discretion)  to be
repaid  to a  trustee,  receiver  or any other  party,  in  connection  with any
proceeding  under any Debtor Relief Law or otherwise,  then (a) to the extent of
such  recovery,  the  obligation  or  part  thereof  originally  intended  to be
satisfied  shall be revived  and  continued  in full force and effect as if such
payment had not been made or such setoff had not  occurred,  and (b) each Lender
and the L/C  Issuer  severally  agrees to pay to the  Administrative  Agent upon
demand its  applicable  share (without  duplication)  of any amount so recovered
from or repaid by the Administrative  Agent, plus interest thereon from the date
of such demand to the date such payment is made at a rate per annum equal to the
Federal Funds Rate from time to time in effect.  The  obligations of the Lenders
and the L/C Issuer under clause (b) of the preceding  sentence shall survive the
payment in full of the Obligations and the termination of this Agreement.

     10.06. SUCCESSORS AND ASSIGNS.

     (a)  SUCCESSORS  AND ASSIGNS  GENERALLY.  The  provisions of this Agreement
shall be binding  upon and inure to the benefit of the parties  hereto and their
respective  successors  and assigns  permitted  hereby,  except that neither the
Borrower  nor any other Loan Party may assign or  otherwise  transfer any of its
rights or  obligations  hereunder  without  the  prior  written  consent  of the
Administrative  Agent and each  Lender  and no Lender  may  assign or  otherwise
transfer any of its rights or obligations hereunder except (i) to an assignee in
accordance with the provisions of subsection (b) of this Section, (ii) by way of
participation  in  accordance  with the  provisions  of  subsection  (d) of this
Section,  (iii) by way of pledge or assignment of a security interest subject to
the  restrictions  of  subsection  (f) of  this  Section,  or  (iv) to an SPC in
accordance  with the provisions of subsection (h) of this Section (and any other
attempted  assignment  or transfer by any party  hereto shall be null and void).
Nothing in this  Agreement,  expressed or implied,  shall be construed to confer
upon any Person (other than the parties hereto, their respective  successors and
assigns permitted hereby,  Participants to the extent provided in subsection (d)
of this Section and, to the extent expressly  contemplated  hereby,  the Related
Parties of each of the Administrative Agent, the L/C Issuer and the Lenders) any
legal or equitable right, remedy or claim under or by reason of this Agreement.

     (b)  ASSIGNMENTS  BY  LENDERS.  Any Lender may at any time assign to one or
more  assignees  all or a portion  of its  rights  and  obligations  under  this
Agreement (including all or a portion of its Commitment and the Loans (including
for purposes of this  subsection (b),  participations  in L/C Obligations and in
Swing Line Loans) at the time owing to it);  PROVIDED  that any such  assignment
shall be subject to the following conditions:

          (i) MINIMUM AMOUNTS.

                                      S-92
<PAGE>

          (A) in the case of an assignment of the entire remaining amount of the
     assigning  Lender's  Commitment and the Loans at the time owing to it or in
     the case of an  assignment  to a Lender or an  Affiliate  of a  Lender,  no
     minimum amount need be assigned; and

          (B) in any case not described in subsection (b)(i)(A) of this Section,
     the aggregate  amount of the  Commitment  (which for this purpose  includes
     Loans outstanding  thereunder) or, if the Commitment is not then in effect,
     the  principal  outstanding  balance of the Loans of the  assigning  Lender
     subject to each such  assignment,  determined as of the date the Assignment
     and  Assumption  with  respect  to  such  assignment  is  delivered  to the
     Administrative Agent or, if "Trade Date" is specified in the Assignment and
     Assumption,  as of the Trade Date, shall not be less than $5,000,000 unless
     each of the  Administrative  Agent and,  so long as no Event of Default has
     occurred and is  continuing,  the Borrower  otherwise  consents  (each such
     consent not to be  unreasonably  withheld or delayed);  PROVIDED,  HOWEVER,
     that concurrent  assignments to members of an Assignee Group and concurrent
     assignments  from members of an Assignee Group to a single  assignee (or to
     an assignee and members of its Assignee  Group) will be treated as a single
     assignment for purposes of determining whether such minimum amount has been
     met.

     (ii)  PROPORTIONATE  AMOUNTS.  Each partial  assignment shall be made as an
assignment  of a  proportionate  part of all the assigning  Lender's  rights and
obligations  under this  Agreement  with respect to the Loans or the  Commitment
assigned,  except  that this  clause  (ii)  shall  not  apply to the Swing  Line
Lender's rights and obligations in respect of Swing Line Loans;

     (iii)  REQUIRED  CONSENTS.  No consent shall be required for any assignment
except to the extent  required by  subsection  (b)(i)(B) of this Section and, in
addition:

          (A) the consent of the Borrower  (such consent not to be  unreasonably
     withheld or delayed)  shall be required  unless (1) an Event of Default has
     occurred  and is  continuing  at the  time of such  assignment  or (2) such
     assignment is to a Lender or an Affiliate of a Lender;

          (B) the consent of the  Administrative  Agent (such  consent not to be
     unreasonably  withheld or delayed) shall be required if such  assignment is
     to a Person that is not a Lender;

          (C) the consent of the L/C Issuer (such consent not to be unreasonably
     withheld or  delayed)  shall be  required  if (i) such  assignment  is to a
     Person  that is not a Lender and (ii) the  Aggregate  Commitments  have not
     been terminated; and

          (D) the  consent  of the Swing Line  Lender  (such  consent  not to be
     unreasonably  withheld or delayed) shall be required if (i) such assignment
     is to a  Person  that  is  not a  Lender  and  (ii)  either  the  Aggregate
     Commitments  have  not been  terminated  or  there  are any LC  Obligations
     outstanding.

                                      S-93
<PAGE>

          (iv) ASSIGNMENT AND ASSUMPTION.  The parties to each assignment  shall
     execute  and  deliver  to  the  Administrative   Agent  an  Assignment  and
     Assumption,  together with a processing and  recordation fee in the amount,
     if any, required as set forth in SCHEDULE 10.06;  PROVIDED,  HOWEVER,  that
     the Administrative  Agent may, in its sole discretion,  elect to waive such
     processing and recordation fee in the case of any assignment. The assignee,
     if it is not a  Lender,  shall  deliver  to  the  Administrative  Agent  an
     Administrative Questionnaire.

          (v) NO ASSIGNMENT TO BORROWER. No such assignment shall be made to the
     Borrower or any of the Borrower's Affiliates or Subsidiaries.

          (vi) NO ASSIGNMENT TO NATURAL  PERSONS.  No such  assignment  shall be
     made to a natural person.

     Subject to acceptance  and recording  thereof by the  Administrative  Agent
pursuant to subsection  (c) of this Section,  from and after the effective  date
specified in each Assignment and Assumption,  the assignee thereunder shall be a
party to this  Agreement  and,  to the extent of the  interest  assigned by such
Assignment  and  Assumption,  have the rights and  obligations of a Lender under
this Agreement,  and the assigning Lender thereunder shall, to the extent of the
interest  assigned by such  Assignment  and  Assumption,  be  released  from its
obligations  under  this  Agreement  (and,  in the  case  of an  Assignment  and
Assumption  covering all of the assigning  Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the  benefits of SECTIONS  3.01,  3.04,  3.05,  and 10.04 with
respect to facts and circumstances occurring prior to the effective date of such
assignment.  Upon  request,  the  Borrower (at its  expense)  shall  execute and
deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of
rights or  obligations  under  this  Agreement  that does not  comply  with this
subsection  shall be treated for  purposes of this  Agreement  as a sale by such
Lender of a  participation  in such rights and  obligations  in accordance  with
subsection (d) of this Section.

     (c) REGISTER.  The Administrative  Agent, acting solely for this purpose as
an agent of the Borrower,  shall maintain at the Administrative Agent's Office a
copy of each  Assignment and  Assumption  delivered to it and a register for the
recordation of the names and addresses of the Lenders,  and the  Commitments of,
and  principal  amounts of the Loans and L/C  Obligations  owing to, each Lender
pursuant to the terms hereof from time to time (the "REGISTER").  The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent and
the  Lenders  may treat each  Person  whose  name is  recorded  in the  Register
pursuant  to the terms  hereof as a Lender  hereunder  for all  purposes of this
Agreement,  notwithstanding  notice  to the  contrary.  The  Register  shall  be
available for inspection by the Borrower and any Lender,  at any reasonable time
and from time to time upon reasonable prior notice.

     (d) PARTICIPATIONS.  Any Lender may at any time, without the consent of, or
notice to, the Borrower or the Administrative  Agent, sell participations to any
Person  (other than a natural  person or the  Borrower or any of the  Borrower's
Affiliates or Subsidiaries)  (each, a "PARTICIPANT") in all or a portion of such
Lender's  rights and/or  obligations  under this  Agreement  (including all or a
portion  of  its   Commitment   and/or  the  Loans   (including   such  Lender's
participations  in L/C  Obligations  and/or  Swing  Line  Loans)  owing  to it);

                                      S-94
<PAGE>

PROVIDED that (i) such Lender's  obligations  under this Agreement  shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the  performance  of such  obligations  and (iii) the  Borrower,  the
Administrative  Agent,  the  Lenders and the L/C Issuer  shall  continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement.

     Any  agreement  or  instrument  pursuant  to  which a Lender  sells  such a
participation  shall  provide  that such Lender  shall  retain the sole right to
enforce this Agreement and to approve any amendment,  modification  or waiver of
any provision of this Agreement;  PROVIDED that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, waiver or other modification described in the first proviso to
SECTION 10.01 that affects such  Participant.  Subject to subsection (e) of this
Section,  the  Borrower  agrees that each  Participant  shall be entitled to the
benefits  of  SECTIONS  3.01,  3.04 and 3.05 to the same  extent as if it were a
Lender and had acquired its interest by assignment pursuant to subsection (b) of
this Section.  To the extent  permitted by law, each  Participant  also shall be
entitled to the benefits of SECTION  10.08 as though it were a Lender,  PROVIDED
such  Participant  agrees  to be  subject  to  SECTION  2.13 as though it were a
Lender.

     (e)  LIMITATIONS  UPON  PARTICIPANT  RIGHTS.  A  Participant  shall  not be
entitled to receive  any greater  payment  under  SECTION  3.01 or 3.04 than the
applicable  Lender  would  have been  entitled  to receive  with  respect to the
participation sold to such Participant,  unless the sale of the participation to
such  Participant  is  made  with  the  Borrower's  prior  written  consent.   A
Participant  that  would be a Foreign  Lender  if it were a Lender  shall not be
entitled to the  benefits of SECTION 3.01 unless the Borrower is notified of the
participation  sold to such  Participant and such  Participant  agrees,  for the
benefit of the  Borrower,  to comply  with  SECTION  3.01(E) as though it were a
Lender.

     (f) CERTAIN PLEDGES. Any Lender may at any time pledge or assign a security
interest in all or any  portion of its rights  under this  Agreement  (including
under its Note,  if any) to secure  obligations  of such Lender,  including  any
pledge or assignment to secure  obligations to a Federal Reserve Bank;  PROVIDED
that no such  pledge or  assignment  shall  release  such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

     (g) ELECTRONIC EXECUTION OF ASSIGNMENTS.  The words "execution,"  "signed,"
"signature,"  and words of like import in any Assignment and Assumption shall be
deemed to include electronic  signatures or the keeping of records in electronic
form,   each  of  which  shall  be  of  the  same  legal  effect,   validity  or
enforceability  as a manually  executed  signature  or the use of a  paper-based
recordkeeping  system,  as the case may be, to the extent and as provided for in
any applicable law,  including the Federal  Electronic  Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other  similar  state laws based on the Uniform  Electronic  Transactions
Act.

     (h)  SPECIAL  PURPOSE  FUNDING  VEHICLES.  Notwithstanding  anything to the
contrary  contained  herein,  any Lender (a  "GRANTING  Lender")  may grant to a
special purpose funding vehicle  identified as such in writing from time to time
by the Granting Lender to the  Administrative  Agent and the Borrower (an "SPC")

                                      S-95
<PAGE>

the option to provide all or any part of any  Committed  Loan that such Granting
Lender would otherwise be obligated to make pursuant to this Agreement; PROVIDED
that (i) nothing  herein shall  constitute  a commitment  by any SPC to fund any
Committed  Loan,  and (ii) if an SPC  elects  not to  exercise  such  option  or
otherwise  fails to make all or any part of such  Committed  Loan,  the Granting
Lender  shall be  obligated to make such  Committed  Loan  pursuant to the terms
hereof  or,  if it fails to do so, to make such  payment  to the  Administrative
Agent as is required under SECTION 2.12(B)(II).  Each party hereto hereby agrees
that (i) neither the grant to any SPC nor the exercise by any SPC of such option
shall  increase  the costs or  expenses  or  otherwise  increase  or change  the
obligations  of the Borrower under this  Agreement  (including  its  obligations
under  SECTION  3.04),  (ii) no SPC shall be liable for any indemnity or similar
payment  obligation under this Agreement for which a Lender would be liable, and
(iii) the Granting Lender shall for all purposes,  including the approval of any
amendment,  waiver or other  modification of any provision of any Loan Document,
remain the lender of record hereunder.  The making of a Committed Loan by an SPC
hereunder  shall  utilize  the  Commitment  of the  Granting  Lender to the same
extent,  and as if, such  Committed Loan were made by such Granting  Lender.  In
furtherance of the foregoing,  each party hereto hereby agrees (which  agreement
shall survive the termination of this Agreement) that, prior to the date that is
one year and one day after the  payment  in full of all  outstanding  commercial
paper or other senior debt of any SPC, it will not  institute  against,  or join
any   other   Person  in   instituting   against,   such  SPC  any   bankruptcy,
reorganization,  arrangement,  insolvency,  or liquidation  proceeding under the
laws of the United States or any State thereof.  Notwithstanding anything to the
contrary  contained  herein,  any SPC may (i) with notice to, but without  prior
consent of the Borrower and the  Administrative  Agent and with the payment of a
processing  fee in the amount of $2,500,  assign all or any portion of its right
to receive payment with respect to any Committed Loan to the Granting Lender and
(ii) disclose on a confidential basis any non-public information relating to its
funding of  Committed  Loans to any rating  agency,  commercial  paper dealer or
provider of any surety or Guarantee or credit or liquidity  enhancement  to such
SPC.

     (i)  RESIGNATION  AS L/C  ISSUER OR SWING  LINE  LENDER  AFTER  ASSIGNMENT.
Notwithstanding  anything to the contrary  contained herein, if at any time Bank
of America  assigns all of its  Commitment  and Loans pursuant to subsection (b)
above,  Bank of America  may,  (i) upon 30 days'  notice to the Borrower and the
Lenders,  resign as L/C Issuer and/or (ii) upon 30 days' notice to the Borrower,
resign as Swing Line Lender.  In the event of any such resignation as L/C Issuer
or Swing Line Lender,  the Borrower  shall be entitled to appoint from among the
Lenders  a  successor  L/C  Issuer or Swing  Line  Lender  hereunder;  PROVIDED,
HOWEVER,  that no failure by the  Borrower to appoint any such  successor  shall
affect the resignation of Bank of America as L/C Issuer or Swing Line Lender, as
the case may be. If Bank of America  resigns as L/C Issuer,  it shall retain all
the  rights,  powers,  privileges  and duties of the L/C Issuer  hereunder  with
respect to all Letters of Credit  outstanding  as of the  effective  date of its
resignation  as  L/C  Issuer  and  all  L/C  Obligations  with  respect  thereto
(including the right to require the Lenders to make Base Rate Committed Loans or
fund risk  participations in Unreimbursed  Amounts pursuant to SECTION 2.03(C)).
If Bank of America resigns as Swing Line Lender,  it shall retain all the rights
of the Swing Line Lender provided for hereunder with respect to Swing Line Loans
made  by it and  outstanding  as of the  effective  date  of  such  resignation,
including the right to require the Lenders to make Base Rate Committed  Loans or
fund risk  participations  in  outstanding  Swing Line Loans pursuant to SECTION
2.04(C).  Upon the  appointment  of a  successor  L/C Issuer  and/or  Swing Line

                                      S-96
<PAGE>

Lender,  (a) such  successor  shall succeed to and become vested with all of the
rights,  powers,  privileges and duties of the retiring L/C Issuer or Swing Line
Lender, as the case may be, and (b) the successor L/C Issuer shall issue letters
of credit in substitution for the Letters of Credit, if any,  outstanding at the
time of such  succession  or make  other  arrangements  satisfactory  to Bank of
America to effectively assume the obligations of Bank of America with respect to
such Letters of Credit.

     10.07.  TREATMENT  OF  CERTAIN  INFORMATION;  CONFIDENTIALITY.  Each of the
Administrative  Agent,  the  Lenders and the L/C Issuer  agrees to maintain  the
confidentiality  of the Information (as defined below),  except that Information
may be disclosed (a) to its Affiliates and to its and its Affiliates' respective
partners,  directors,  officers, employees, agents, advisors and representatives
(it being  understood  that the Persons to whom such  disclosure is made will be
informed of the  confidential  nature of such Information and instructed to keep
such  Information  confidential),  (b) to the extent requested by any regulatory
authority purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners),  (c) to
the extent  required by  applicable  laws or  regulations  or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with the
exercise  of any  remedies  hereunder  or under any other Loan  Document  or any
action or  proceeding  relating to this  Agreement or any other Loan Document or
the enforcement of rights  hereunder or thereunder,  (f) subject to an agreement
containing  provisions  substantially the same as those of this Section,  to (i)
any assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations  under this Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative transaction
relating  to the  Borrower  and its  obligations,  (g) with the  consent  of the
Borrower or (h) to the extent such  Information (x) becomes  publicly  available
other than as a result of a breach of this  Section or (y) becomes  available to
the Administrative  Agent, any Lender, the L/C Issuer or any of their respective
Affiliates on a nonconfidential basis from a source other than the Borrower.

     For purposes of this Section,  "INFORMATION" means all information received
from the Borrower or any  Subsidiary  relating to the Borrower or any Subsidiary
or any of their respective  businesses,  other than any such information that is
available  to the  Administrative  Agent,  any  Lender  or the L/C  Issuer  on a
nonconfidential  basis prior to  disclosure  by the Borrower or any  Subsidiary,
PROVIDED  that,  in the case of  information  received  from the Borrower or any
Subsidiary after the date hereof,  such information is clearly identified at the
time  of  delivery  as  confidential.   Any  Person  required  to  maintain  the
confidentiality  of  Information as provided in this Section shall be considered
to have complied  with its  obligation to do so if such Person has exercised the
same degree of care to maintain the  confidentiality of such Information as such
Person would accord to its own confidential information.

     Each  of  the  Administrative   Agent,  the  Lenders  and  the  L/C  Issuer
acknowledges   that  (a)  the  Information  may  include   material   non-public
information concerning the Borrower or a Subsidiary,  as the case may be, (b) it
has developed  compliance  procedures  regarding the use of material  non-public
information  and (c) it will  handle such  material  non-public  information  in
accordance with applicable Law, including Federal and state securities Laws.

     10.08.  RIGHT OF SETOFF.  If an Event of Default shall have occurred and be
continuing,  each Lender, the L/C Issuer and each of their respective Affiliates

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<PAGE>

is hereby  authorized  at any time and from time to time,  after  obtaining  the
prior  written  consent  of the  Administrative  Agent,  to the  fullest  extent
permitted by applicable law, to set off and apply any and all deposits  (general
or special,  time or demand,  provisional or final, in whatever currency) at any
time held and other obligations (in whatever currency) at any time owing by such
Lender, the L/C Issuer or any such Affiliate to or for the credit or the account
of the Borrower or any other Loan Party  against any and all of the  obligations
of the  Borrower  or such  Loan  Party  now or  hereafter  existing  under  this
Agreement  or any  other  Loan  Document  to  such  Lender  or the  L/C  Issuer,
irrespective of whether or not such Lender or the L/C Issuer shall have made any
demand  under  this  Agreement  or any other Loan  Document  and  although  such
obligations of the Borrower or such Loan Party may be contingent or unmatured or
are owed to a branch or office of such Lender or the L/C Issuer  different  from
the branch or office holding such deposit or obligated on such indebtedness. The
rights of each Lender, the L/C Issuer and their respective Affiliates under this
Section are in addition to other rights and remedies  (including other rights of
setoff)  that such Lender,  the L/C Issuer or their  respective  Affiliates  may
have.  Each  Lender and the L/C Issuer  agrees to notify  the  Borrower  and the
Administrative  Agent promptly after any such setoff and  application,  PROVIDED
that the  failure to give such  notice  shall not affect  the  validity  of such
setoff and application.

     10.09. INTEREST RATE LIMITATION.  Notwithstanding  anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan  Documents  shall not  exceed the  maximum  rate of  non-usurious  interest
permitted by applicable Law (the "MAXIMUM RATE"). If the Administrative Agent or
any Lender shall  receive  interest in an amount that exceeds the Maximum  Rate,
the excess  interest  shall be applied to the  principal  of the Loans or, if it
exceeds such unpaid principal,  refunded to the Borrower. In determining whether
the interest contracted for, charged, or received by the Administrative Agent or
a Lender exceeds the Maximum Rate,  such Person may, to the extent  permitted by
applicable  Law,  (a)  characterize  any  payment  that is not  principal  as an
expense, fee, or premium rather than interest, (b) exclude voluntary prepayments
and the effects  thereof,  and (c) amortize,  prorate,  allocate,  and spread in
equal or unequal parts the total amount of interest  throughout the contemplated
term of the Obligations hereunder.

     10.10.  COUNTERPARTS;  INTEGRATION;  EFFECTIVENESS.  This  Agreement may be
executed  in  counterparts   (and  by  different  parties  hereto  in  different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract.  This Agreement and the other
Loan Documents  constitute the entire contract among the parties relating to the
subject  matter  hereof  and  supersede  any and  all  previous  agreements  and
understandings,  oral or written,  relating to the subject matter hereof. Except
as provided in SECTION 4.01, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative Agent
shall have received  counterparts  hereof that,  when taken  together,  bear the
signatures  of  each  of the  other  parties  hereto.  Delivery  of an  executed
counterpart of a signature page of this Agreement by telecopy shall be effective
as delivery of a manually executed counterpart of this Agreement.

     10.11. SURVIVAL OF REPRESENTATIONS AND WARRANTIES.  All representations and
warranties  made  hereunder  and in any other Loan  Document  or other  document
delivered  pursuant  hereto or thereto or in  connection  herewith or  therewith

                                      S-98
<PAGE>

shall   survive  the   execution   and  delivery   hereof  and   thereof.   Such
representations  and  warranties  have  been  or  will  be  relied  upon  by the
Administrative  Agent and each Lender,  regardless of any investigation  made by
the  Administrative  Agent or any Lender or on their behalf and  notwithstanding
that the Administrative  Agent or any Lender may have had notice or knowledge of
any  Default at the time of any Credit  Extension,  and shall  continue  in full
force and  effect as long as any Loan or any other  Obligation  hereunder  shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

     10.12.  SEVERABILITY.  If any provision of this Agreement or the other Loan
Documents is held to be illegal,  invalid or  unenforceable,  (a) the  legality,
validity and  enforceability  of the remaining  provisions of this Agreement and
the other Loan Documents  shall not be affected or impaired  thereby and (b) the
parties  shall  endeavor  in good faith  negotiations  to replace  the  illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which  comes  as  close  as  possible  to  that  of  the  illegal,   invalid  or
unenforceable  provisions.  The  invalidity  of  a  provision  in  a  particular
jurisdiction shall not invalidate or render  unenforceable such provision in any
other jurisdiction.

     10.13.  REPLACEMENT  OF LENDERS.  If any Lender (i)  requests  compensation
under SECTION 3.04 or (ii) fails to agree to any amendment or waiver or give its
consent to any matter which has been approved by the Required Lenders, or if the
Borrower  is  required  to  pay  any  additional  amount  to any  Lender  or any
Governmental  Authority for the account of any Lender  pursuant to SECTION 3.01,
if any Lender is a Defaulting Lender, then the Borrower may, at its sole expense
and effort,  upon notice to such Lender and the  Administrative  Agent,  require
such Lender to assign and delegate,  without  recourse (in  accordance  with and
subject to the  restrictions  contained  in, and consents  required by,  SECTION
10.06),  all of its interests,  rights and obligations  under this Agreement and
the related  Loan  Documents to an assignee  that shall assume such  obligations
(which  assignee may be another  Lender,  if a Lender accepts such  assignment),
provided that:

     (a) the Borrower shall have paid to the Administrative Agent the assignment
fee specified in SECTION 10.06(B);

     (b) such  Lender  shall have  received  payment  of an amount  equal to the
outstanding  principal of its Loans and L/C Advances,  accrued interest thereon,
accrued fees and all other  amounts  payable to it hereunder and under the other
Loan Documents  (including any amounts under SECTION 3.05) from the assignee (to
the extent of such  outstanding  principal and accrued interest and fees) or the
Borrower (in the case of all other amounts);

     (c)  in the  case  of any  such  assignment  resulting  from  a  claim  for
compensation  under  SECTION  3.04 or payments  required to be made  pursuant to
SECTION 3.01, such assignment will result in a reduction in such compensation or
payments thereafter; and

     (d) such assignment does not conflict with applicable Laws.

     A Lender shall not be required to make any such  assignment  or  delegation
if,  prior  thereto,  as a result of a waiver by such Lender or  otherwise,  the
circumstances  entitling the Borrower to require such  assignment and delegation
cease to apply.

                                      S-99
<PAGE>

     10.14. GOVERNING LAW; JURISDICTION; ETC.

     (a) GOVERNING  LAW. THIS  AGREEMENT  SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

     (b)  SUBMISSION  TO  JURISDICTION.  THE  BORROWER AND EACH OTHER LOAN PARTY
IRREVOCABLY AND  UNCONDITIONALLY  SUBMITS,  FOR ITSELF AND ITS PROPERTY,  TO THE
NONEXCLUSIVE  JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW
YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN  DISTRICT OF
NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF,  IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT,  OR FOR
RECOGNITION  OR  ENFORCEMENT  OF ANY  JUDGMENT,  AND EACH OF THE PARTIES  HERETO
IRREVOCABLY  AND  UNCONDITIONALLY  AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH
ACTION OR  PROCEEDING  MAY BE HEARD AND  DETERMINED IN SUCH NEW YORK STATE COURT
OR, TO THE FULLEST  EXTENT  PERMITTED BY APPLICABLE  LAW, IN SUCH FEDERAL COURT.
EACH OF THE PARTIES  HERETO  AGREES THAT A FINAL  JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING  SHALL BE CONCLUSIVE  AND MAY BE ENFORCED IN OTHER  JURISDICTIONS  BY
SUIT ON THE  JUDGMENT OR IN ANY OTHER  MANNER  PROVIDED BY LAW.  NOTHING IN THIS
AGREEMENT  OR IN ANY  OTHER  LOAN  DOCUMENT  SHALL  AFFECT  ANY  RIGHT  THAT THE
ADMINISTRATIVE  AGENT,  ANY LENDER OR THE L/C ISSUER MAY OTHERWISE HAVE TO BRING
ANY ACTION OR PROCEEDING  RELATING TO THIS  AGREEMENT OR ANY OTHER LOAN DOCUMENT
AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS  PROPERTIES IN THE COURTS OF
ANY JURISDICTION.

     (c) WAIVER OF VENUE. THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND
UNCONDITIONALLY  WAIVES,  TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION
OR  PROCEEDING  ARISING OUT OF OR RELATING TO THIS  AGREEMENT  OR ANY OTHER LOAN
DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION.  EACH OF THE
PARTIES HERETO HEREBY  IRREVOCABLY  WAIVES,  TO THE FULLEST EXTENT  PERMITTED BY
APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT  FORUM TO THE MAINTENANCE OF SUCH
ACTION OR PROCEEDING IN ANY SUCH COURT.

     (d) SERVICE OF PROCESS.  EACH PARTY HERETO IRREVOCABLY  CONSENTS TO SERVICE
OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02.  NOTHING IN THIS
AGREEMENT  WILL  AFFECT  THE RIGHT OF ANY PARTY  HERETO TO SERVE  PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.

     10.15.  WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY  WAIVES,
TO THE FULLEST  EXTENT  PERMITTED BY APPLICABLE  LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING  DIRECTLY OR INDIRECTLY  ARISING OUT OF OR

                                     S-100
<PAGE>

RELATING  TO THIS  AGREEMENT  OR ANY OTHER  LOAN  DOCUMENT  OR THE  TRANSACTIONS
CONTEMPLATED  HEREBY OR THEREBY  (WHETHER  BASED ON CONTRACT,  TORT OR ANY OTHER
THEORY).  EACH  PARTY  HERETO (A)  CERTIFIES  THAT NO  REPRESENTATIVE,  AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED,  EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER  PERSON  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 AND THE OTHER LOAN DOCUMENTS BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

     10.16.  NO ADVISORY OR FIDUCIARY  RESPONSIBILITY.  In  connection  with all
aspects of each  transaction  contemplated  hereby,  the Borrower and each other
Loan  Party   acknowledges   and  agrees,   and   acknowledges  its  Affiliates'
understanding,  that:  (i) the credit  facility  provided for  hereunder and any
related  arranging  or other  services in  connection  therewith  (including  in
connection  with any amendment,  waiver or other  modification  hereof or of any
other Loan  Document) are an  arm's-length  commercial  transaction  between the
Borrower,  each  other Loan Party and their  respective  Affiliates,  on the one
hand, and the  Administrative  Agent and the Arranger,  , on the other hand, and
the  Borrower  and  each  other  Loan  Party  is  capable  of   evaluating   and
understanding and understands and accepts the terms, risks and conditions of the
transactions  contemplated hereby and by the other Loan Documents (including any
amendment,  waiver or other modification hereof or thereof);  (ii) in connection
with the process leading to such transaction,  the Administrative  Agent and the
Arranger  each is and has  been  acting  solely  as a  principal  and is not the
financial advisor, agent or fiduciary, for the Borrower, any other Loan Party or
any of their respective Affiliates,  stockholders, creditors or employees or any
other  Person;  (iii)  neither the  Administrative  Agent nor the  Arranger  has
assumed or will assume an advisory,  agency or fiduciary responsibility in favor
of the Borrower or any other Loan Party with respect to any of the  transactions
contemplated  hereby or the process leading  thereto,  including with respect to
any amendment, waiver or other modification hereof or of any other Loan Document
(irrespective of whether the Administrative Agent or the Arranger has advised or
is  currently  advising  the  Borrower,  any  other  Loan  Party or any of their
respective Affiliates on other matters) and neither the Administrative Agent nor
the Arranger has any obligation to the Borrower,  any other Loan Party or any of
their respective Affiliates with respect to the transactions contemplated hereby
except  those  obligations  expressly  set forth  herein  and in the other  Loan
Documents;  (iv) the Administrative  Agent and the Arranger and their respective
Affiliates  may be  engaged  in a  broad  range  of  transactions  that  involve
interests  that differ from those of the  Borrower,  the other Loan  Parties and
their  respective  Affiliates,  and  neither  the  Administrative  Agent nor the
Arranger has any  obligation to disclose any of such  interests by virtue of any
advisory, agency or fiduciary relationship; and (v) the Administrative Agent and
the  Arranger  have not  provided  and will not provide  any legal,  accounting,
regulatory  or tax advice with respect to any of the  transactions  contemplated
hereby (including any amendment,  waiver or other modification  hereof or of any
other Loan  Document)  and each of the  Borrower  and the other Loan Parties has
consulted its own legal,  accounting,  regulatory and tax advisors to the extent
it has deemed  appropriate.  Each of the  Borrower  and the other  Loan  Parties
hereby waives and releases,  to the fullest extent  permitted by law, any claims

                                     S-101
<PAGE>

that it may have against the Administrative  Agent and the Arranger with respect
to any breach or alleged breach of agency or fiduciary duty.

     10.17.  USA PATRIOT ACT NOTICE.  Each Lender that is subject to the Act (as
hereinafter  defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrower that pursuant to the requirements of
the USA PATRIOT Act (Title III of Pub.  L. 107-56  (signed  into law October 26,
2001)) (the "ACT"), it is required to obtain, verify and record information that
identifies the Borrower,  which information includes the name and address of the
Borrower and other information that will allow such Lender or the Administrative
Agent, as applicable, to identify the Borrower in accordance with the Act.

     10.18.  TIME OF THE ESSENCE.  Time is of the essence of the Loan Documents;
provided  that this SECTION 10.18 shall not be construed to limit or deprive the
Loan Parties of any grace periods set forth in any Loan Document.



               [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]



                                     S-102
<PAGE>







     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Agreement to be
duly executed as of the date first above written.


                                    BORROWER:
                                    ---------



                                    COLUMBUS MCKINNON CORPORATION

                                    By:      /S/ Karen L. Howard
                                       -----------------------------------------
                                    Name:    Karen L. Howard
                                    Title:   Vice President - Finance and
                                             Treasurer and Chief Financial
                                             Officer


                       Signature Page to Credit Agreement

<PAGE>


                                    ACKNOWLEDGED AND AGREED BY THE GUARANTORS:
                                    ------------------------------------------



                                    YALE INDUSTRIAL PRODUCTS, INC.

                                    By:      /S/ Karen L. Howard
                                       -----------------------------------------
                                    Name:    Karen L. Howard
                                    Title:   Vice President



                                    CRANE EQUIPMENT & SERVICE, INC.

                                    By:      /S/ Karen L. Howard
                                       -----------------------------------------
                                    Name:    Karen L. Howard
                                    Title:   Vice President



                                    AUDUBON EUROPE S.A.R.L.

                                    By:      /S/ Karen L. Howard
                                       -----------------------------------------
                                    Name:    Karen L. Howard
                                    Title:   Manager



                                    By:      /S/ Romain Thillens
                                       -----------------------------------------
                                    Name:    Romain Thillens
                                    Title:   Manager


                       Signature Page to Credit Agreement

<PAGE>






                                    LENDERS:
                                    --------

                                    BANK OF AMERICA, N.A.,
                                    as Administrative Agent

                                    By:      /S/ Tamisha U. Eason
                                       -----------------------------------------
                                    Name:    Tamisha Eason
                                    Title:   Vice President

                       Signature Page to Credit Agreement

<PAGE>


                                    BANK OF AMERICA, N.A., AS A LENDER,
                                    L/C ISSUER AND SWING LINE LENDER

                                    By:      /S/ Colleen M. O'Brien
                                       -----------------------------------------
                                    Name:    Colleen O'Brien
                                    Title:   Vice President

                       Signature Page to Credit Agreement

<PAGE>


                                    CITIZENS BANK, N.A.

                                    By:      /S/ Thomas L. Giles
                                       -----------------------------------------
                                    Name:    Thomas L. Giles
                                    Title:   Vice President

                       Signature Page to Credit Agreement

<PAGE>


                                    MANUFACTURERS AND TRADERS TRUST COMPANY

                                    By:      /S/ Andrew M. Constantino
                                       -----------------------------------------
                                    Name:    Andrew M. Constantino
                                    Title:   Vice President

                       Signature Page to Credit Agreement

<PAGE>


                                    JPMORGAN CHASE BANK, N.A.

                                    By:      /S/ Cary J. Haller
                                       -----------------------------------------
                                    Name:    Cary J. Haller
                                    Title:   Vice President

                       Signature Page to Credit Agreement

<PAGE>


                                    NATIONAL CITY BANK OF PA

                                    By:      /S/ Susan J. Dimmick
                                       -----------------------------------------
                                    Name:    Susan J. Dimmick
                                    Title:   Vice President

                       Signature Page to Credit Agreement

<PAGE>


                                    GREATER BUFFALO SAVINGS BANK

                                    By:      /S/ Ted Oexle
                                       -----------------------------------------
                                    Name:    Ted Oexle
                                    Title:   Vice President

                       Signature Page to Credit Agreement