Exhibit 10.13


 


EXECUTION VERSION


 




 





$340,000,000


 


TERM LOAN AGREEMENT


 


among


 


NEW ATA ACQUISITION INC.,


 


The Several Lenders from Time to
Time Parties Hereto,


 


JEFFERIES FINANCE LLC,


 


as Documentation Agent,


 


and


 


JPMORGAN CHASE BANK, N.A.,


 


as Administrative Agent


 


Dated as of August 14,
2007




 





 


J.P. Morgan Securities Inc.,

as Sole Lead Arranger and Sole Bookrunner


 

















 


TABLE OF CONTENTS


 


	
   

  	
  Page

  
	
   

  	
   

  
	
  SECTION 1.  DEFINITIONS

  	
  1

  
	
   

  	
   

  
	
  1.1  Defined
  Terms

  	
  1

  
	
  1.2  Other
  Definitional Provisions

  	
  29

  
	
  SECTION 2.  AMOUNT AND
  TERMS OF LOANS

  	
  30

  
	
   

  	
   

  
	
  2.1  Loans

  	
  30

  
	
  2.2  Procedure
  for Borrowing

  	
  30

  
	
  2.3  Maturity
  and Exchange Notes

  	
  30

  
	
  2.4  Repayment
  of Loans

  	
  31

  
	
  2.5  Optional
  and Mandatory Prepayment

  	
  31

  
	
  2.6  Interest
  Rates and Payment Dates

  	
  32

  
	
  2.7  Computation
  of Interest and Fees

  	
  33

  
	
  2.8  Pro Rata
  Treatment and Payments

  	
  33

  
	
  2.9  Requirements
  of Law

  	
  34

  
	
  2.10  Taxes

  	
  35

  
	
  2.11  Indemnity

  	
  36

  
	
  2.12  Change of
  Lending Office

  	
  36

  
	
   

  	
   

  
	
  SECTION 3.  REPRESENTATIONS
  AND WARRANTIES

  	
  37

  
	
   

  	
   

  
	
  3.1  Financial
  Condition

  	
  37

  
	
  3.2  No Change

  	
  38

  
	
  3.3  Corporate
  Existence; Compliance with Law

  	
  38

  
	
  3.4  Corporate
  Power; Authorization; Enforceable Obligations

  	
  38

  
	
  3.5  No Legal
  Bar

  	
  39

  
	
  3.6  No
  Material Litigation

  	
  39

  
	
  3.7  No
  Default

  	
  39

  
	
  3.8  Ownership
  of Property; Liens

  	
  39

  
	
  3.9  Intellectual
  Property

  	
  39

  
	
  3.10  Taxes

  	
  39

  
	
  3.11  Federal
  Regulations

  	
  39

  
	
  3.12  Labor
  Matters

  	
  40

  
	
  3.13  ERISA

  	
  40

  
	
  3.14  Investment
  Company Act; Other Regulations

  	
  40

  
	
  3.15  Subsidiaries

  	
  40

  
	
  3.16  Purpose
  of Loans

  	
  40

  
	
  3.17  Environmental
  Matters

  	
  40

  
	
  3.18  Solvency

  	
  41

  
	
  3.19  Accuracy
  of Information, etc

  	
  41

  
	
  3.20  Delivery
  of the Transaction Documents

  	
  42

  
	
  3.21  Security
  Documents

  	
  42

  
	
  3.22  Section 1110

  	
  42

  
	
   

  	
   

  
	
  SECTION 4.  CONDITIONS
  PRECEDENT

  	
  43

  
	
   

  	
   

  
	
  SECTION 5.  AFFIRMATIVE
  COVENANTS

  	
  47

  
	
   

  	
   

  
	
  5.1  Financial
  Statements

  	
  47

  
	
  5.2  Certificates;
  Other Information

  	
  47

  



 


i

















 


	
   

  	
  Page

  
	
   

  	
   

  
	
  5.3  Payment
  of Obligations

  	
  48

  
	
  5.4  Maintenance
  of Existence; Compliance

  	
  48

  
	
  5.5  Maintenance
  of Property; Insurance

  	
  49

  
	
  5.6  Inspection
  of Property; Books and Records; Discussions

  	
  49

  
	
  5.7  Notices

  	
  49

  
	
  5.8  Environmental
  Laws

  	
  50

  
	
  5.9  Take-Out
  Financing

  	
  50

  
	
  5.10  Exchange
  Notes

  	
  51

  
	
  5.11  Use of
  Proceeds of the Take-Out Debt

  	
  52

  
	
  5.12  Additional
  Collateral

  	
  52

  
	
  5.13  Post-Closing
  Matters

  	
  53

  
	
  5.14  Further
  Assurances

  	
  54

  
	
   

  	
   

  
	
  SECTION 6.  NEGATIVE
  COVENANTS

  	
  54

  
	
   

  	
   

  
	
  6.1  Limitation
  on Indebtedness

  	
  54

  
	
  6.2  Limitation
  on Restricted Payments

  	
  58

  
	
  6.3  Limitation
  on Restrictions on Distributions from Subsidiaries

  	
  60

  
	
  6.4  Limitation
  on Sales of Assets and Subsidiary Stock

  	
  61

  
	
  6.5  Limitation
  on Liens

  	
  62

  
	
  6.6  Limitation
  on Affiliate Transactions

  	
  62

  
	
  6.7  Change of
  Control

  	
  64

  
	
  6.8  Limitation
  on Sale of Voting Stock of Subsidiaries

  	
  64

  
	
  6.9  Merger,
  Consolidation, etc.

  	
  64

  
	
  6.10  Limitation
  on Lines of Business

  	
  65

  
	
  6.11  Limitation
  on Sale/Leaseback and Aircraft Lease Transactions

  	
  65

  
	
  6.12  Payments
  for Consent

  	
  65

  
	
   

  	
   

  
	
  SECTION 7.  EVENTS OF
  DEFAULT

  	
  65

  
	
   

  	
   

  
	
  SECTION 8.  THE AGENTS

  	
  68

  
	
   

  	
   

  
	
  8.1  Appointment

  	
  68

  
	
  8.2  Delegation
  of Duties

  	
  68

  
	
  8.3  Exculpatory
  Provisions

  	
  68

  
	
  8.4  Reliance
  by Administrative Agent

  	
  69

  
	
  8.5  Notice of
  Default

  	
  69

  
	
  8.6  Non-Reliance
  on Agents and Other Lenders

  	
  69

  
	
  8.7  Indemnification

  	
  70

  
	
  8.8  Agent in
  Its Individual Capacity

  	
  70

  
	
  8.9  Successor
  Administrative Agent

  	
  70

  
	
  8.10  Documentation
  Agent

  	
  71

  
	
   

  	
   

  
	
  SECTION 9.  MISCELLANEOUS

  	
  71

  
	
   

  	
   

  
	
  9.1  Amendments
  and Waivers

  	
  71

  
	
  9.2  Notices

  	
  72

  
	
  9.3  No
  Waiver; Cumulative Remedies

  	
  73

  
	
  9.4  Survival
  of Representations and Warranties

  	
  73

  
	
  9.5  Payment
  of Expenses and Taxes

  	
  73

  
	
  9.6  Successors
  and Assigns; Participations and Assignments

  	
  74

  
	
  9.7  Adjustments;
  Set-off

  	
  77

  
	
  9.8  Counterparts

  	
  78

  
	
  9.9  Severability

  	
  78

  



 


ii

















 


	
   

  	
  Page

  
	
   

  	
   

  
	
  9.10  Integration

  	
  78

  
	
  9.11  GOVERNING
  LAW

  	
  78

  
	
  9.12  Submission
  To Jurisdiction; Waivers

  	
  78

  
	
  9.13  Acknowledgements

  	
  79

  
	
  9.14  WAIVERS
  OF JURY TRIAL

  	
  79

  
	
  9.15  Confidentiality

  	
  79

  
	
  9.16  Releases
  of Guarantees and Liens

  	
  80

  



 


	
  SCHEDULES:

  	
   

  
	
   

  	
   

  
	
  1.1A

  	
  Commitments

  
	
  1.1B

  	
  Mortgaged Real Property

  
	
  1.1C

  	
  Mortgaged Aircraft

  
	
  1.1D

  	
  Specified Aircraft

  
	
  3.1(d)

  	
  Pro Forma Financial
  Statements

  
	
  3.15

  	
  Subsidiaries

  
	
  3.21(a)

  	
  UCC Filing Jurisdictions

  
	
  3.21(b)

  	
  Mortgage Filing
  Jurisdictions

  
	
  6.1(a)(iii)

  	
  Existing Indebtedness

  
	
  6.2(b)(vi)

  	
  Agreements Relating to
  Transactions

  
	
  6.3(a)

  	
  Existing Encumbrances or
  Restrictions

  
	
  6.5

  	
  Existing Liens

  
	
  6.6(b)

  	
  Existing Affiliate
  Transactions

  
	
   

  	
   

  
	
  EXHIBITS:

  	
   

  
	
   

  	
   

  
	
  A

  	
  Form of Guarantee and
  Collateral Agreement

  
	
  B

  	
  Description of Exchange
  Notes

  
	
  C

  	
  Form of Closing
  Certificate

  
	
  D

  	
  [Intentionally Omitted]

  
	
  E

  	
  Form of Assignment
  and Assumption

  
	
  F-1

  	
  Form of Legal Opinion
  of Cravath, Swaine & Moore LLP

  
	
  F-2

  	
  Form of Legal Opinion
  of Delaware counsel

  
	
  F-3

  	
  Form of Legal Opinion
  of FAA counsel

  
	
  F-4

  	
  Form of Legal Opinion
  of General Counsel of ATA

  
	
  F-5

  	
  Form of Legal Opinion
  of General Counsel of Target

  
	
  G

  	
  [Intentionally Omitted]

  
	
  H

  	
  Form of Exemption
  Certificate

  
	
  I-1

  	
  Form of Initial Loan
  Note

  
	
  I-2

  	
  Form of Term Note

  
	
  J

  	
  Form of Warrant
  Agreement

  
	
  K

  	
  Form of Exchange and
  Registration Rights Agreement

  



 


iii

















 


TERM LOAN AGREEMENT, dated as of August 14,
2007, among NEW ATA ACQUISITION INC., a Delaware corporation (the “Company”), the several lenders from time
to time parties hereto (collectively, the “Lenders”;
individually, a “Lender”),
JEFFERIES FINANCE LLC, as documentation agent (in such capacity, the “Documentation Agent”), and JPMORGAN CHASE
BANK, N.A., as administrative agent for the Lenders hereunder (in such
capacity, the “Administrative Agent”).


 


The
parties hereto hereby agree as follows:


 


SECTION 1.    DEFINITIONS


 


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


 


“Acquired Indebtedness”:  Indebtedness (i) of a Person or any of
its Subsidiaries existing at the time such Person becomes a Subsidiary, (ii) assumed
in connection with the acquisition of assets from such Person, or (iii) of
a Person at the time such Person merges with or into or consolidates or
otherwise combines with the Company or any Subsidiary, in each case whether or
not Incurred by such Person in connection with, or in anticipation or contemplation
of, such Person becoming a Subsidiary or such acquisition. Acquired
Indebtedness shall be deemed to have been Incurred, with respect to clause (i) of
the preceding sentence, on the date such Person becomes a Subsidiary and, with
respect to clause (ii) of the preceding sentence, on the date of
consummation of such acquisition of assets.


 


“Additional Assets”:  (i) any property, plant, equipment or
other asset (excluding current assets) used or to be used by the Company or a
Subsidiary in a Related Business or otherwise useful in a Related Business (it
being understood that capital expenditures on property or assets already used
in a Related Business or to replace any property or assets that are the subject
of an Asset Disposition generating the proceeds being invested in such property
or assets shall be deemed an investment in Additional Assets); (ii) the
Capital Stock of a Person that becomes a Subsidiary as a result of the
acquisition of such Capital Stock by the Company or another Subsidiary; or (iii) Capital
Stock constituting a minority interest in any Person that at such time is a
Subsidiary; provided, however, that,
in the case of clauses (ii) and (iii), such Subsidiary is primarily
engaged in a Related Business.


 


“Adjusted LIBO Rate”:
with respect to each day pertaining to a Eurodollar Loan, a rate per annum
determined for such day in accordance with the following formula (rounded
upward to the nearest 1/100th of 1%):


 




	
  Eurodollar Base Rate

  
	
  1.00 – Eurocurrency
  Reserve Requirements

  






 


“Adjusted Margin”:  with respect to any Loan, 0 basis points
during the three-month period commencing on the Initial Maturity Date and for
each subsequent three-month period thereafter, 50 basis points higher than the
Adjusted Margin for the immediately preceding three-month period.


 


“Adjusted Rate”:  the rate equal to 50 basis points plus the
interest rate borne by the Loans on the day immediately preceding the Initial
Maturity Date (excluding the PIK Margin).


 


“Administrative Agent”:  as defined in the preamble hereto.


 


“Affiliate”:  as to any Person, any other Person (other
than a Subsidiary) which, directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person.  For


 

















 


purposes of this definition, “control” of a Person means the power,
directly or indirectly, to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities by
contract or otherwise; and the terms “controlling” and “controlled” have
meanings correlative to the foregoing. 
For purposes of Sections 6.4, 6.6 and 6.8 only, “Affiliate” shall also
mean any beneficial owner of shares representing 20% or more of the total
voting power of the Voting Stock (on a fully diluted basis) of the Company or of
rights or warrants to purchase such Voting Stock (whether or not currently
exercisable) and any Person who would be an Affiliate of any such beneficial
owner pursuant to the first sentence hereof.


 


“Affiliate Transaction”:  as defined in Section 6.6.


 


“Agents”:  the collective reference to the Documentation
Agent and the Administrative Agent.


 


“Agreement”:  this Term Loan Agreement, as amended,
supplemented or otherwise modified from time to time.


 


“Aircraft Acquisition Debt”:
 Indebtedness Incurred by the Company or
any Subsidiary in connection with an acquisition of Specified Aircraft, (i) which
Indebtedness (x) either constitutes all or part of the purchase price
thereof, or is Incurred prior to, at the time of or within one year after the
acquisition thereof for the purpose of financing or refinancing part of the
purchase price thereof and (y) is non-recourse other than to the assets
financed, and (ii) which equipment was not owned by the Company or a
Subsidiary immediately prior to such purchase; provided,  however, that in either case the proportion (expressed as a
percentage) of such Indebtedness to the purchase price or appraised value of
such equipment at the time of such financing does not exceed 90% (except that
the foregoing limitation shall not apply to aircraft under order or option on
the Closing Date for which vendor financing (including by way of vendor
guarantee) is initially obtained).


 


“Aircraft Lease Transaction”:
 any lease (other than a lease creating
Capitalized Lease Obligations) by the Company or any Subsidiary of aircraft,
related engines or spare engines, spare parts or other related equipment
(including ground equipment) from any Person other than the Company or any
Subsidiary for an initial term (inclusive of renewal terms solely at the option
of the Company or such Subsidiary, as the case may be) of at least 12 months.


 


“Aircraft Mortgage”:  each of the mortgages and deeds of trust made
by any Loan Party with respect to an aircraft owned by such Loan Party in favor
of, or for the benefit of, the Administrative Agent for the benefit of the
Lenders, in form and substance reasonably satisfactory to the Administrative
Agent.


 


“Airport Authority”:  any city or any public or private board or
other body or organization chartered or otherwise established for the purpose
of administering, operating or managing airports or related facilities, which
in each case is an owner, administrator, operator or manager of one or more
airports or related facilities.


 


“Applicable
Margin”:  with respect to any
Loan, (i) 0 basis points during the six-month period commencing on the
Closing Date, (ii) 100 basis points during the three-month period
following the period in clause (i) and (iii) for each three-month
period subsequent to the period in clause (ii) until the Initial Maturity
Date, 50 basis points higher than the Applicable Margin for the immediately
preceding three-month period.


 


2

















 


“Approved Fund”:  as defined in Section 9.6(b).


 


“Asset Disposition”:  any direct or indirect sale, lease (other
than an operating lease entered into in the ordinary course of business),
transfer, or other disposition (or series of related sales, leases, transfers
or dispositions that are part of a common plan) of shares of Capital Stock of a
Subsidiary (other than directors’ qualifying shares), property or other assets
(including aircraft, aircraft engines and related equipment (and leasehold
interest therein)) (each referred to for the purposes of this definition as a “disposition”)
by the Company or any of its Subsidiaries (including any disposition by means
of a merger, consolidation or similar transaction), other than:


 


(i)            a disposition of assets by a Subsidiary to the Company or by
the Company or a Subsidiary to another Subsidiary; provided that in the
case of a sale by a Subsidiary to another Subsidiary involving a Subsidiary
that is not a Loan Party, the Company directly or indirectly owns an equal or
greater percentage of the Common Stock of the transferee than of the
transferor; and provided further that
in the case of a sale of Collateral, the transferee shall take such action
reasonably requested by the Administrative Agent to cause such amendments,
supplements or other instruments to be executed, filed and recorded in such
jurisdictions as may be required by applicable law to preserve and protect the
Lien on the Collateral owned by or transferred to the transferee, together with
such financing statements or comparable documents as may be required to perfect
any security interests in such Collateral which may be perfected by the filing
of a financing statement or a similar document under the Uniform Commercial
Code or other similar statute or regulation of the relevant states or
jurisdictions;


 


(ii)           dispositions of cash and Cash Equivalents in the ordinary
course of business;


 


(iii)          (A) a disposition of
fuel or inventory in the ordinary course of business and (B) swaps,
exchanges, interchange or pooling of assets or, in the case of Mortgaged
Aircraft, other transfers of possession (subject to the limitations set forth
in the Security Documents) in the ordinary course of business;


 


(iv)          a disposition of surplus, obsolete or worn out equipment
(including aircrafts, aircraft engines and spare parts) or equipment (including
aircrafts, aircraft engines and spare parts) that is no longer used or useful
in the conduct of the business of the Company and its Subsidiaries and that is
disposed of in each case in the ordinary course of business;


 


(v)           transactions permitted under Section 6.9;


 


(vi)          an issuance of Capital Stock by a Subsidiary to the Company
or to another Subsidiary or as part of or pursuant to an equity incentive or
compensation plan approved by the Board of Directors of the Company;


 


(vii)         (x) for purposes of Section 6.4 only, the
making of a Permitted Investment (other than a Permitted Investment to the
extent such transaction results in the receipt of cash or Cash Equivalents by
the Company or its Subsidiaries) or (y) a disposition permitted by (and
subject to the terms of) Section 6.2;


 


(viii)        the creation of a Permitted
Lien and dispositions in connection with Permitted Liens;


 


3

















 


(ix)           dispositions of receivables in connection
with the compromise, settlement or collection thereof in the ordinary course of
business or in bankruptcy or similar proceedings and exclusive of factoring or
similar arrangements;


 


(x)            the issuance by a Subsidiary of Preferred
Stock that is permitted by Section 6.1;


 


(xi)           (A) abandonment of FAA Slots, Gate
Interests, Routes or Supporting Route Facilities; provided that such
abandonment is (1) in connection with the downsizing of any hub or
facility which does not materially and adversely affect the business of Company
and its Subsidiaries, taken as a whole, or (2) in the ordinary course of
business consistent with past practices and does not materially and adversely
affect the business of Company and its Subsidiaries, taken as a whole, (B) exchange
of FAA Slots in the ordinary course of business that in the Company’s
reasonable judgment are of reasonably equivalent value and (C) assignments
of leases or granting of leases of aircraft or engines (that do not constitute
Collateral), in each case, in the ordinary course of business;


 


(xii)          any fuel supply arrangements in the ordinary
course of business;


 


(xiii)                          sales, transfers and other dispositions of
Investments in joint ventures to the extent required by, or made pursuant to,
customary buy/sell arrangements between the joint venture parties set forth in
the joint venture arrangements and similar binding agreements;


 


(xiv)        the licensing or sublicensing of intellectual
property or other general intangibles and licenses, leases or subleases of
other property in the ordinary course of business which do not materially
interfere with the business of the Company and its Subsidiaries;


 


(xv)         foreclosure on assets;


 


(xvi)        dispositions of property or other assets to
the extent subject to Casualty Events; and


 


(xvii)       dispositions of property or other assets having
book values not to exceed than $5,000,000 in the aggregate.


 


“Assignee”:  as defined in Section 9.6(b).


 


“Assignment and Assumption”:  an assignment and assumption, substantially
in the form of Exhibit E hereto.


 


“ATA”:  ATA Airlines, Inc., an Indiana
corporation.


 


“ATSB Loan Agreement”:  the Amended and Restated Loan Agreement, dated
as of February 28, 2006, among ATA Airlines, Inc., New ATA Holdings
Inc. and its subsidiaries from time to time party thereto, Air Transportation
Stabilization Board and Citibank, N.A.


 


“Attributable Indebtedness”:
 in respect of a Sale/Leaseback
Transaction or Aircraft Lease Transaction means, as at the time of
determination, the present value (discounted at the interest rate implicit in
the transaction) of the total obligations of the lessee for rental payments


 


4

















 


during the remaining term of the lease included in such Sale/Leaseback
Transaction or Aircraft Lease Transaction (including any period for which such
lease has been extended), determined in accordance with GAAP; provided, however, that if such
Sale/Leaseback Transaction results in a Capitalized Lease Obligation, the
amount of Indebtedness represented thereby will be determined in accordance
with the definition of “Capitalized Lease Obligations”.


 


“Average Life”:  as of the date of determination, with respect
to any Indebtedness or Preferred Stock, the quotient obtained by dividing (i) the
sum of the products of the numbers of years from the date of determination to
the dates of each successive scheduled principal payment of such Indebtedness
or redemption or similar payment with respect to such Preferred Stock
multiplied by the amount of such payment by (ii) the sum of all such
payments.


 


“Benefitted Lender”:  as defined in Section 9.7(a).


 


“Board of Directors”:  as to any Person, the board of directors of
such Person or any committee thereof duly authorized to act on behalf of such
board.


 


“Board of Governors”:  the Board of Governors of the Federal Reserve
System (or any successor thereto).


 


“Business Day”: a day
other than a Saturday, Sunday or other day on which banking institutions in New
York, New York are authorized or required by law to close; provided that
with respect to notices and determinations in connection with, and payments of
principal and interest on, Eurodollar Loans, such day is also a day for trading
by and between banks in Dollar deposits in the interbank eurodollar market.


 


“Cape Town Convention”:
the official English language texts of the Convention on International
Interests in Mobile Equipment and the Protocol to the Convention on
International Interests in Mobile Equipment on Matters Specific to Aircraft
Equipment which were signed in Cape Town, South Africa, as in effect in any
applicable jurisdiction, as the same may be amended from time to time.


 


“Capital Stock”:  of a Person, any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of,
or interests in (however designated) equity of such Person, including any
Preferred Stock, partnership interests and limited liability company membership
interests, but excluding any debt securities convertible into such equity.


 


“Capitalized Lease Obligations”:  an obligation that is required to be
classified and accounted for as a capitalized lease for financial reporting
purposes in accordance with GAAP, and the amount of Indebtedness represented by
such obligation shall be the capitalized amount of such obligation determined
in accordance with GAAP; and the Stated Maturity thereof shall be the date of
the last payment of rent or any other amount due under such lease prior to the
first date such lease may be terminated without penalty.


 


“Cash Equivalents”:


 


(i)            United States dollars, Euros or any national currency of any
participating member state of the European Monetary Union, or such local
currencies held by the Company and its Subsidiaries from time to time in the
ordinary course of business;


 


5

















 


(ii)           securities issued or directly and fully guaranteed or insured
by the United States Government or any agency or instrumentality of the United
States (provided that the full faith and credit of the United States is
pledged in support thereof) or a member nation of the European Union, having
maturities of not more than one year from the date of acquisition;


 


(iii)          marketable general obligations issued by any state
of the United States of America or any political subdivision of any such state
or any public instrumentality thereof maturing within one year from the date of
acquisition thereof (provided that the full faith and credit of the
United States is pledged in support thereof) and, at the time of acquisition,
having a credit rating of “A” or better from either Standard & Poor’s
Ratings Group, Inc. or Moody’s Investors Service, Inc.;


 


(iv)          certificates of deposit, time deposits, eurodollar time
deposits, overnight bank deposits or bankers’ acceptances having maturities of
not more than one year from the date of acquisition thereof issued by any
commercial bank the long term debt of which is rated at the time of acquisition
thereof at least “A” or the equivalent thereof by Standard & Poor’s
Ratings Group, Inc., or “A” or the equivalent thereof by Moody’s Investors
Service, Inc., and having combined capital and surplus in excess of
$500,000,000;


 


(v)           repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (i), (ii) and
(iii) entered into with any bank meeting the qualifications specified in
clause (iii) above;


 


(vi)          commercial paper rated at the time of acquisition thereof at
least “A 2” or the equivalent thereof by Standard & Poor’s Ratings
Group, Inc. or “P 2” or the equivalent thereof by Moody’s Investors
Service, Inc., or carrying an equivalent rating by a nationally recognized
rating agency, if both of the two named rating agencies cease publishing
ratings of investments, and in any case maturing within one year after the date
of acquisition thereof; and


 


(vii)         interests in any investment company or money market
fund which invests 95% or more of its assets in instruments of the type
specified in clauses (i) through (v) above.


 


“Cash Pay Date”:  the second anniversary of the Closing Date.


 


“Casualty Event”:  any taking under power of eminent domain or
similar proceeding and any insured loss (excluding business interruption), in
each case relating to property or other assets that constitute Collateral.


 


“Change of Control”:


 


(i)            prior to the first Equity Offering of Common Stock of
Holdings, the Permitted Holders cease to be the “beneficial owner” (as defined
in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly,
of a majority in the aggregate of the total voting power of the Voting Stock of
the Company or Holdings then outstanding, whether as a result of the issuance
of securities of the Company or Holdings, any merger, consolidation,
liquidation or dissolution of the Company


 


6

















 


or Holdings, any direct or indirect
transfer of securities by any Permitted Holder or otherwise (for purposes of
this clause (i) and clause (ii) below, the Permitted Holders shall be
deemed to beneficially own any Voting Stock of an entity (the “specified entity”) held by any other
entity (the “parent entity”) so
long as the Permitted Holders beneficially own (as so defined), directly or
indirectly, in the aggregate a majority of the voting power of the Voting Stock
of the parent entity); or


 


(ii)           on the date of or after the first Equity Offering of Common
Stock referred to in clause (i), (A) any “person” or “group” of related
persons (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act), other than one or more Permitted Holders, becomes the beneficial
owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except
that such person or group shall be deemed to have “beneficial ownership” of all
shares that any such person or group has the right to acquire, whether such
right is exercisable immediately or only after the passage of time), directly
or indirectly, of more than 35% of the total voting power of the Voting Stock
of the Company or Holdings (or its successor by merger, consolidation or
purchase of all or substantially all of its assets) (for the purposes of this
clause, such person or group shall be deemed to beneficially own any Voting
Stock of the Company or Holdings held by a parent entity, if such person or
group “beneficially owns” (as defined above), directly or indirectly, more than
a majority of the voting power of the Voting Stock of such parent entity); and (B) the
Permitted Holders “beneficially own” (as defined in Rules 13d-3 and 13d-5
of the Exchange Act), directly or indirectly, in the aggregate a lesser
percentage of the total voting power of the Voting Stock of the Company or
Holdings, as the case may be (or its successor by merger, consolidation or
purchase of all or substantially all of its assets) than such other person or
group and do not have the right or ability by voting power, contract or
otherwise to elect or designate for election a majority of the board of
directors of the Company or Holdings or such successor (for the purposes of
this clause, such other person or group shall be deemed to beneficially own any
Voting Stock of a specified entity held by a parent entity, if such other
person or group “beneficially owns”, directly or indirectly, more than 35% of
the voting power of the Voting Stock of such parent entity and the Permitted
Holders “beneficially own”, directly or indirectly, in the aggregate a lesser
percentage of the voting power of the Voting Stock of such parent entity and do
not have the right or ability by voting power, contract or otherwise to elect
or designate for election a majority of the board of directors of such parent
entity);


 


(iii)          the first day on which a majority of the members of
the Board of Directors of Holdings are not Continuing Directors; or


 


(iv)          the sale, lease, transfer, conveyance or other disposition
(other than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company or
Holdings and its Subsidiaries taken as a whole to any “person” (as such term is
used in Sections 13(d) and 14(d) of the Exchange Act) other than a
Permitted Holder; or


 


(v)           the adoption by the stockholders of the Company or Holdings
of a plan or proposal for the liquidation or dissolution of the Company or
Holdings; or


 


7

















 


(vi)          the first date on which Holdings no longer directly or
indirectly owns 100% of the Capital Stock of the Company.


 


“Closing Date”:  the date on which the conditions precedent
set forth in Section 4 shall be satisfied or waived.


 


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


 


“Collateral”:  all property of the Loan Parties, now owned
or hereafter acquired, upon which a Lien is purported to be created by any
Security Document.


 


“Commitment”:  as to any Lender, its obligation to make a
Loan to the Company on the Closing Date in an amount equal to the amount set
forth opposite such Lender’s name in Schedule
1.1A under the heading “Commitment”;
collectively, as to all such Lenders, the “Commitments”. The aggregate
amount of the Commitments as of the Closing Date is $340,000,000.


 


“Commitment Percentage”:  as to any Lender at any time, the percentage
of the aggregate Commitments then constituted by such Lender’s Commitment (or,
after the Loans are made on the Closing Date, the percentage of the aggregate
Loans then constituted by such Lender’s Loans).


 


“Common Stock”:  with respect to any Person, any and all
shares, interest or other participations in, and other equivalents (however
designated and whether voting or nonvoting) of such Person’s common stock
whether or not outstanding on the Closing Date, and includes, without
limitation, all series and classes of such common stock.


 


“Commonly Controlled Entity”:  an entity, whether or not incorporated, which
is under the same “controlled group” within the meaning of Section 4001 of
ERISA, as the Company or which, together with the Company, is treated as a
single employer under Section 414 of the Code.


 


“Company”:  as defined in the preamble hereto.


 


“Continuing Directors”:  as of any date of determination, any member
of the Board of Directors of the Company or Holdings, as the case may be, who (1) was
a member of such Board of Directors on the date of this Agreement; or (2) was
nominated for election or elected to such Board of Directors with the approval
of a majority of the Continuing Directors who were members of the relevant
Board at the time of such nomination or election or the approval of the
Permitted Holders.


 


“Contractual Obligation”:  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.


 


“Currency Agreement”:  in respect of a Person any foreign exchange
contract, currency swap agreement or other similar agreement as to which such
Person is a party or a beneficiary.


 


“Default”:  any event or condition that is, or after
notice or passage of time or both would be, an Event of Default.


 


“Description
of Exchange Notes”: the description contained in Exhibit B hereto.


 


8

















 


“Disqualified Stock”:  with respect to any Person, any Capital Stock
that by its terms (or by the terms of any security into which it is convertible
or for which it is exchangeable) or upon the happening of any event (i) matures
or is mandatorily redeemable (other than solely for Qualified Stock) pursuant
to a sinking fund obligation or otherwise, (ii) is convertible or
exchangeable for Indebtedness or Disqualified Stock (excluding Capital Stock
that is convertible or exchangeable solely at the option of the Company or a
Subsidiary) or (iii) is redeemable at the option of the holder thereof
(other than solely for Qualified Stock), in whole or in part, in each case, on
or prior to the date that is 91 days after the Final Maturity Date; provided
that (x) only the portion of Capital Stock which so matures or is
mandatorily redeemable, is so convertible or exchangeable or is so redeemable
at the option of the holder thereof prior to such date shall be deemed to be
Disqualified Stock; (y) if such Capital Stock is issued to any plan for
the benefit of employees, directors or consultants of the Company or its
Subsidiaries or by any such plan to such employees, directors or consultants
such Capital Stock shall not constitute Disqualified Stock solely because it
may be required to be repurchased by the Company or its Subsidiaries in order
to satisfy applicable statutory or regulatory obligations; and (z) any
Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Company to repurchase such
Capital Stock upon the occurrence of a change of control or asset disposition
(each defined in a substantially identical manner to the corresponding definitions
in this Agreement) shall not constitute Disqualified Stock if the terms of such
Capital Stock (and all such securities into which it is convertible or for
which it is ratable or exchangeable) provide that the Company is not required
to repurchase or redeem any such Capital Stock (and all such securities into
which it is convertible or for which it is ratable or exchangeable) pursuant to
such provision prior to compliance by the Company with the provisions of this
Agreement or repayment in full of the Loans.


 


“Documentation Agent”:  as defined in the preamble hereto.


 


“Dollars” and “$”: 
dollars in lawful currency of the United States of America.


 


“DOT”:  the United States Department of Transportation
and any successor thereto.


 


“Entry Point Filing Forms”:  each of the FAA form AC 8050-135 forms to be
filed with the FAA on the Closing Date.


 


“Environmental Laws”:  any and all applicable foreign, federal,
state, local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements of any Governmental Authority or other
Requirements of Law (including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of human health as it
relates to the environment or the environment, as now or may at any time
hereafter be in effect.


 


“Equity Offering”:  a public offering for cash by the Company or
Holdings, as the case may be, of its Common Stock, or options, warrants or
rights with respect to its Common Stock, registered under the Securities Act,
other than (x) public offerings with respect to the Company’s or Holdings’,
as the case may be, Common Stock, or options, warrants or rights with respect
thereto, registered on Form S-4 or S-8, (y) an issuance to any
Subsidiary or (z) any offering of Common Stock issued in connection with a
transaction that constitutes a Change of Control.


 


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


 


“Eurocurrency Reserve Requirements”:
 for any day as applied to a Eurodollar
Loan, the aggregate (without duplication) of the maximum rates (expressed as a
decimal fraction) of reserve


 


9

















 


requirements in effect on such day (including, without limitation,
basic, supplemental, marginal and emergency reserves) under any regulations of
the Board of Governors or other Governmental Authority having jurisdiction with
respect thereto dealing with reserve requirements prescribed for eurocurrency
funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of
the Board of Governors) maintained by a member bank of the Federal Reserve
System.


 


“Eurodollar Base Rate”:
with respect to each Eurodollar Loan, the rate per annum determined by the
Administrative Agent to be the offered rate for deposits in Dollars with a term
of three months and that appears on the applicable Reuters Screen LIBOR01 Page at
approximately 10:00 a.m., New York City time, two Business Days prior to (i) the
Closing Date for the Interest Period commencing on the Closing Date and (ii) thereafter,
the last day of the next preceding Interest Period; provided, however, that if
at any time for any reason such offered rate does not appear on the applicable
Reuters Screen LIBOR01 Page, “Eurodollar Base Rate” shall mean, with respect to
each day pertaining to a Eurodollar Loan, the rate per annum equal to the rate
at which the Administrative Agent is offered Dollar deposits at or about 10:00 a.m.,
New York City time, two Business Days prior to the Closing Date in the
interbank eurodollar market where the eurodollar and foreign currency and
exchange operations in respect of its Eurodollar Loans are then being conducted
for delivery on the Closing Date for a term of three months and in an amount
comparable to the amount of its Initial Loan.


 


“Eurodollar Loan”:  a Loan bearing interest at a rate determined
by reference to the Adjusted LIBO Rate.


 


“Event of Default”:  any of the events specified in Section 7;
provided that all requirements for the giving of notice, the lapse of
time, or both, and any other conditions, have been satisfied.


 


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


 


“Exchange Note”:  each note issued under the Indenture
delivered pursuant to Section 2.3 and 5.10; collectively, the “Exchange Notes”.


 


“Exchange Request”:  as defined in Section 5.10.


 


“Excluded Foreign Subsidiary”:  any Foreign Subsidiary in respect of which
either (a) the pledge of all of the Capital Stock of such Subsidiary as
Collateral or (b) the guaranteeing by such Subsidiary of the Loans and
other obligations under this Agreement, would, in the good faith judgment of
the Company, result in adverse tax consequences to the Company.


 


“Existing Credit Facilities”:
 the ATSB Loan Agreement and the Wachovia
Facility.


 


“FAA” the Federal
Aviation Administration of the United States of America and any successor
thereto. 


 


“FAA Slots”: all “slots”
as defined in 14 CFR § 93.213(a)(2), as that section may be amended or
re-codified from time to time, or, in the case of slots at New York LaGuardia,
as defined in the Final Order, Operating Limitations at New York LaGuardia
Airport, Docket No. FAA 2006-25755-82 dated December 13, 2006, as
such order may be amended or re-codified from time to time, and in any
subsequent order issued by the FAA related to New York’s LaGuardia Airport, as
such order may be amended or re-codified from time to time, in each case of the
Company or any Subsidiary Guarantor, now held or hereafter acquired (other than
“slots”


 


10

















 


which have been permanently allocated to another air carrier and in
which the Company or any Subsidiary Guarantor holds temporary use rights).


 


“Final Maturity Date”:  the eighth anniversary of the Closing Date.


 


“Foreign Subsidiary”:  any Subsidiary of the Company that is not
organized under the laws of the United States of America or any state thereof
or the District of Columbia.


 


“Fuel Protection Agreement”:
any fuel protection agreement or other similar agreement or arrangement entered
into by the Company or any Subsidiary designed to protect the Company or any of
its Subsidiaries against fluctuations in the market prices of aircraft fuels
and not for the purpose of speculation.


 


“GAAP”:  generally accepted accounting principles in
the United States of America as in effect from time to time, including those
set forth in the opinions and pronouncements of the Accounting Principles Board
of the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such entity as are approved by a significant segment of the
accounting profession; provided, however, that if the Company notifies the
Administrative Agent that the Company requests an amendment to any provision
hereof to eliminate the effect of any change occurring after the Closing Date
in GAAP or in the application thereof on the operation of such provision (or if
the Administrative Agent notifies the Company that the Administrative Agent or
the Required Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith. All ratios and
computations based on GAAP contained in this Agreement will be computed in
conformity with GAAP, except that in the event the Company is acquired in a
transaction that is accounted for using purchase accounting, the effects of the
application of purchase accounting shall be disregarded in the calculation of
such ratios and other computations contained in this Agreement.


 


“Gate Interests”: all of
the right, title, privilege, interest and authority now or hereafter acquired
or held by the Company or, if applicable, a Subsidiary Guarantor in connection with
the right to use or occupy holdroom and passenger boarding and deplaning space
in any airport terminal located in the United States at which the Company
conducts scheduled operations.


 


“Governmental Authority”:  any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of or
pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).


 


“Group Members”:  the collective reference to the Company,
Holdings, IntermediateCo and their respective Subsidiaries.


 


“Guarantee”:  any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Indebtedness of any other
Person, and any obligation, direct or indirect, contingent or otherwise, of
such Person (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other obligation of such other
Person (whether arising by virtue of partnership arrangements, or by agreement
to keep-well, to purchase


 


11

















 


assets, goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into for
purposes of assuring in any other manner the obligee of such Indebtedness or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided,
however, that the term “Guarantee”
shall not include endorsements for collection or deposit in the
ordinary course of business. 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” used as a verb
has a corresponding meaning.


 


“Guarantee and Collateral Agreement”:
the Guarantee and Collateral Agreement, to be executed and delivered by
Holdings, IntermediateCo, the Company and the Subsidiary Guarantors,
substantially in the form of Exhibit A.


 


“Guarantor”:  each of Holdings, IntermediateCo and each
Subsidiary Guarantor.


 


“Guarantor Subordinated Obligation”:
with respect to a Guarantor, any Indebtedness of such Guarantor (whether
outstanding on the Closing Date or thereafter Incurred) which is expressly
subordinate in right of payment to the obligations of such Guarantor under the
Guarantee and Collateral Agreement pursuant to a written agreement.


 


“Hedging Obligations”:  of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement, Currency Agreement or Fuel
Protection Agreement.


 


“Holder” or “Noteholder”:  the Person in whose name an Exchange Note or
a Loan (and any corresponding Note(s)) is registered.


 


“Holdings”:  Global Aero Logistics Inc., a Delaware
corporation.


 


“Incur”:  issue, create, assume, Guarantee, incur or
otherwise become liable for; provided,
however, that any Indebtedness or Capital Stock of a Person existing
at the time such Person becomes a Subsidiary (whether by merger, consolidation,
acquisition or otherwise) shall be deemed to be Incurred by such Subsidiary at
the time it becomes a Subsidiary and the terms “Incurred” and “Incurrence”
have meanings correlative to the foregoing.


 


“Indebtedness”:  with respect to any Person on any date of
determination (without duplication):


 


(i)            the principal of and premium, if any, in respect of
indebtedness of such Person for borrowed money,


 


(ii)           the principal of and premium, if any, in respect of
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments,


 


(iii)          the principal component of
all obligations of such Person in respect of letters of credit, bankers’
acceptances or other similar instruments (including reimbursement obligations
with respect thereto except to the extent such reimbursement obligation relates
to a trade payable and such obligation is satisfied within 30 days of
Incurrence),


 


12

















 


(iv)          the principal component of all obligations of such Person to
pay the deferred and unpaid purchase price of property (except (x) trade
payables and (y) deferred or equity compensation arrangements payable to
directors, officers or employees), which purchase price is due more than six
months after the date of placing such property in service or taking delivery
and title thereto,


 


(v)           all Capitalized Lease Obligations and all Attributable
Indebtedness of such Person,


 


(vi)          the principal component or liquidation preference of all
obligations of such Person with respect to the redemption, repayment or other
repurchase of Disqualified Stock or, with respect to any Subsidiary of the
Company, any Preferred Stock (but excluding, in each case, any accrued
dividends),


 


(vii)         the principal component of all Indebtedness of other
Persons secured by a Lien on any asset of such Person, whether or not such
Indebtedness is assumed by such Person; provided,
however, that the amount of Indebtedness of such Person shall be the
lesser of (A) the fair market value of such asset at such date of
determination and (B) the amount of such Indebtedness of such other
Persons,


 


(viii)        the principal component of all Indebtedness of other
Persons to the extent Guaranteed by such Person, and


 


(ix)           to the extent not otherwise included in this
definition, net obligations of such Person under Hedging Obligations (the
amount of any such obligations to be equal at any time of determination to the
termination value of such agreement or arrangement giving rise to such
obligation that would be payable by such Person at such time).


 


The
term “Indebtedness” shall not
include any lease, concession or license of property (or Guarantee thereof)
which would be considered an operating lease under GAAP (other than Aircraft
Lease Transactions), any advances, prepayments or deposits (or interest
thereon) received from clients or customers in the ordinary course of business,
or obligations under any license, permit or other approval (or Guarantees given
or deposits made in respect of such obligations) Incurred prior to the Closing
Date or in the ordinary course of business.


 


The
amount of Indebtedness of any
Person at any date shall be the outstanding balance at such date of all
unconditional obligations as described above and the maximum liability at such
date (or if the maximum liability is not stated, or determinable, the maximum
reasonably anticipated liability as determined in good faith by the Company),
upon the occurrence of the contingency giving rise to the obligation, of any
contingent obligations described above at such date.


 


In
addition, “Indebtedness” of any Person shall include Indebtedness described in
the preceding paragraph that would not appear as a liability on the balance
sheet of such Person if:


 


(i)            such Indebtedness is the obligation of a partnership or joint
venture that is not a Subsidiary (a “Joint
Venture”);


 


(ii)           such Person or a Subsidiary of such Person is a general
partner of the Joint Venture (a “General
Partner”); and


 


13

















 


(iii)          there is recourse, by contract or operation of law,
with respect to the payment of such Indebtedness to property or assets of such
Person or a Subsidiary of such Person; and then such Indebtedness shall be
included in an amount not to exceed:


 


(a)           the lesser of (1) the net assets of the General Partner
and (2) the amount of such obligations to the extent that there is
recourse, by contract or operation of law, to the property or assets of such
Person or a Subsidiary of such Person; or


 


(b)           if less than the amount determined pursuant to clause (a) immediately
above, the actual amount of such Indebtedness that is recourse to such Person
or a Subsidiary of such Person, if the Indebtedness is evidenced by a writing
and is for a determinable amount.


 


Notwithstanding the above provisions, in no
event shall the following constitute Indebtedness:


 


(i)            in connection with the purchase by the Company or any
Subsidiary of any business, any post-closing payment adjustments to which the
seller may become entitled to the extent such payment is determined by a final
closing balance sheet or such payment depends on the performance of such
business after the closing; provided,
however, that at the time of the closing, the amount of any such
payment is not determinable and, to the extent such payment thereafter becomes
fixed and determined, the amount is paid within 45 days thereafter;


 


(ii)           for the avoidance of doubt, any obligations in respect of
workers’ compensation claims, early retirement or termination obligations,
pension fund obligations or contributions or similar claims, obligations or
contributions or social security or wage taxes; or


 


(iii)          money borrowed and set aside at the time of the
Incurrence of any Indebtedness in order to pre-fund the payment of interest on
such Indebtedness; provided that such money is held to secure the
payment of such interest.


 


“Indenture”:  an Indenture, having terms and conditions
substantially as set forth in the Description of Exchange Notes (with such
changes therein as the Company may request and the Administrative Agent may
approve, such approval not to be unreasonably withheld), if and when executed
and delivered by the Company and the Trustee thereunder, as amended, waived, supplemented
or otherwise modified from time to time.


 


“Initial Loan”:  as defined in Section 2.1(a).


 


“Initial Loan Rate”:  with respect to any Interest Period, the sum
of (i) (A) 131 divided by 340 multiplied by (B) the greater of (x) the
Adjusted LIBO Rate for such Interest Period plus 425 basis points, and (y) the
Treasury Rate for such Interest Period plus 500 basis points plus (ii) (A) 209 divided by 340
multiplied by (B) the Adjusted LIBO Rate for such Interest Period plus 625
basis points.


 


“Initial Maturity Date”:  August 14, 2008.


 


“Initial
Note”:  as defined in Section 9.6(e).


 


14

















 


“Insolvency”:  with respect to any Multiemployer Plan, the
condition that such Multiemployer Plan is insolvent within the meaning of Section 4245
of ERISA.


 


“Insolvent”:  pertaining to a condition of Insolvency.


 


“Intellectual Property”:  the collective reference to all rights,
priorities and privileges relating to intellectual property, whether arising
under United States, multinational or foreign laws or otherwise, including
copyrights, copyright licenses, patents, patent licenses, trademarks, trademark
licenses, technology, know-how and processes, and all rights to sue at law or
in equity for any infringement or other impairment thereof, including the right
to receive all proceeds and damages therefrom.


 


“Interest Payment Date”:  with respect to any Loan, the last day of the
Interest Period applicable to the Loan, and in addition, the date of any
prepayment of such Loan.


 


“Interest
Period”:  (a) prior to
the Initial Maturity Date, as to any Initial Loan, (i) initially, the
period commencing on the Closing Date and ending on the numerically
corresponding day (or, if there is no numerically corresponding day, on the
last day) in the calendar month that is three months thereafter and (ii) thereafter,
each period commencing on the last day of the next preceding Interest Period
and ending on the earlier of (A) the numerically corresponding day (or, if
there is no numerically corresponding day, on the last day) in the calendar
month that is three months thereafter and (B) the Initial Maturity Date,
and (b) following the Initial Maturity Date, as to any Term Loan, (i) initially,
the period commencing on the Initial Maturity Date and ending on the
numerically corresponding day (or, if there is no numerically corresponding
day, on the last day) in the calendar month that is six months thereafter and (ii) thereafter,
each period commencing on the last day of the next preceding Interest Period
and ending on the earlier of (A) the numerically corresponding day (or, if
there is no numerically corresponding day, on the last day) in the calendar
month that is six months thereafter and (B) the Final Maturity Date.
Interest shall accrue from and including the first day of an Interest Period to
but excluding the last day of such Interest Period.


 


“Interest Rate Agreement”:  with respect to any Person any interest rate
protection agreement, interest rate future agreement, interest rate option
agreement, interest rate swap agreement, interest rate cap agreement, interest
rate collar agreement, interest rate hedge agreement or other similar agreement
or arrangement as to which such Person is party or a beneficiary.


 


“IntermediateCo”:  New ATA Investment Inc., a Delaware
corporation.


 


“International Registry”:
“International Registry” as defined in the Cape Town Convention.


 


“Investment”: with
respect to any Person, all investments by such Person in other Persons
(including Affiliates) in the form of loans (including guarantees), advances or
capital contributions (excluding accounts receivable, trade credit, advances to
customers, commissions, travel and similar advances to officers, employees and
consultants, in each case made in the ordinary course of business), purchases
or other acquisitions for consideration of Indebtedness, Capital Stock or other
securities issued by any other Person and investments that are required by GAAP
to be classified on the balance sheet (excluding the footnotes) of such Person
in the same manner as the other investments included in this definition to the
extent such transactions involve the transfer of cash or other property. For
purposes of covenant compliance, the amount of any


 


15

















 


Investment shall be the amount actually invested, without adjustment
for subsequent increases or decreases in the value of such Investment.


 


“Investment Bank”:  one or more investment banks reasonably
satisfactory to the Administrative Agent which may be engaged by the Company to
publicly sell or privately place the Take-Out Debt as contemplated by Section 5.9.


 


“LC Credit Facility”:  the Amended and Restated Credit Agreement
between ATA and National City Bank of Indiana, dated as of February 27, 2006.


 


“Lenders”:  as defined in the preamble to this Agreement.


 


“Lessor Maintenance Reserve Accounts”:
 accounts paid in by a lessee and held by
a lessor for reimbursement of certain aircraft maintenance obligations.


 


“Lien”:  any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or
other title retention agreement or lease in the nature thereof).


 


“Loans”:  as defined in Section 2.1.


 


“Loan Documents”:  this Agreement, the Warrant Agreement, the
Loan Notes and the Security Documents.


 


“Loan Notes”:  the collective reference to the Term Notes
and the Initial Notes.


 


“Loan Parties”:  the collective reference to Holdings,
IntermediateCo, the Company and each of their respective Subsidiaries which
from time to time is a party to any Loan Document.


 


“Material Adverse Effect”:  any event, development or circumstance that
has had or could reasonably be expected to have a material adverse effect on (a) the
business, operations, property or condition (financial or otherwise) of the
Company and its Subsidiaries (including the Target and its Subsidiaries) taken
as a whole or (b) the validity or enforceability of this Agreement or any
of the other Loan Documents or the rights or remedies of the Administrative
Agent or the Lenders hereunder or thereunder.


 


“Materials of Environmental Concern”:  any gasoline or petroleum (including crude
oil or any fraction thereof) or petroleum products or any hazardous or toxic
substances, materials or wastes, to the extent defined or regulated as such in
or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.


 


“Merger”:  as defined in Section 4(b)(i).


 


“Merger Agreement”:  the Agreement and Plan of Merger, dated April 5,
2007, between Holdings, the Company and World Air Holdings, Inc., a
Delaware corporation, as amended, supplemented or modified from time to time
prior to the Closing Date.


 


“Merger
Documents”:  the Merger
Agreement, and any other document entered into in connection therewith, in each
case as amended, supplemented or modified from time to time prior to the
Closing Date.


 


16

















 


“Mortgaged Aircraft”:  the aircraft, engines and spare engines
listed on Schedule 1.1C and owned by a Loan Party, as to which the
Administrative Agent for the benefit of the Lenders shall be granted a Lien
pursuant to the Aircraft Mortgages.


 


“Mortgaged Properties”:  the collective reference to the Mortgaged
Aircraft and the Mortgaged Real Properties.


 


“Mortgaged Real Properties”:  the real properties listed on Schedule 1.1B
and owned by a Loan Party, as to which the Administrative Agent for the benefit
of the Lenders shall be granted a Lien pursuant to the Real Estate Mortgages.


 


“Mortgages”:  the collective reference to the Aircraft
Mortgages and the Real Estate Mortgages.


 


“MP Bridge Loan Agreement”:
the Bridge Loan Agreement, dated January 16, 2007, between ATA, as
borrower, Holdings, certain subsidiaries of Holdings from time to time party
thereto, and MatlinPatterson ATA Holdings LLC, as lender (as amended,
supplemented or otherwise modified on the date hereof).


 


“MP Term Loan Agreement”:
the Term Loan Agreement, dated February 28, 2006, between ATA, as
borrower, Holdings, subsidiaries of Holdings from time to time party thereto,
JPMorgan Chase Bank, N.A., as administrative agent and the lenders from time to
time parties thereto, pursuant to which MatlinPatterson ATA Holdings LLC is the
sole lender (as amended, supplemented or otherwise modified on the date
hereof).


 


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


 


“NAA”:  North American Airlines, Inc., a Delaware
corporation.


 


“Net Available Cash”:  from an Asset Disposition or Casualty Event,
cash payments received (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise
and net proceeds from the sale or other disposition of any securities received
as consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring person of
Indebtedness or other obligations relating to the properties or assets that are
the subject of such Asset Disposition or Casualty Event or received in any
other non-cash form) therefrom, in each case net of: (i) all legal,
accounting, investment banking, title and recording tax expenses, commissions
and other fees and expenses Incurred, and all Federal, state, provincial,
foreign and local taxes required to be paid or accrued as a liability under
GAAP (after taking into account any available tax credits or deductions and any
tax sharing agreements), as a consequence of such Asset Disposition or Casualty
Event; (ii) all payments made on any Indebtedness which is secured by any
assets subject to such Asset Disposition or Casualty Event, in accordance with
the terms of any Lien upon such assets, or which must by its terms, or in order
to obtain a necessary consent to such Asset Disposition or Casualty Event, or
by applicable law be repaid out of the proceeds from such Asset Disposition or
Casualty Event; (iii) all distributions and other payments required to be
made to minority interest holders (other than any direct or indirect parent
company, the Company or any of their respective Subsidiaries) in Subsidiaries
or joint ventures as a result of such Asset Disposition or Casualty Event; and (iv) the
deduction of appropriate amounts to be provided by the seller as a reserve, in
accordance with GAAP, against any liabilities associated


 


17

















 


with the assets disposed of in such Asset Disposition or Casualty Event
and retained by the Company or any Subsidiary after such Asset Disposition or
Casualty Event.


 


“Net Cash Proceeds”:  with respect to any issuance or sale of
Capital Stock or Indebtedness, the cash proceeds of such issuance or sale net
of attorneys’ fees, accountants’ fees, underwriters’ or placement agents’ fees,
listing fees, discounts or commissions and brokerage, consultant and other fees
and charges actually incurred in connection with such issuance or sale and net
of taxes paid or payable as a result of such issuance or sale (after taking
into account any available tax credit or deductions and any tax sharing
arrangements); provided that the cash proceeds of an Equity Offering by
Holdings shall not be deemed Net Cash Proceeds, except to the extent such cash
proceeds are contributed to the Company.


 


“Non-Excluded Taxes”:  as defined in Section 2.10(a).


 


“Non-U.S. Lender”:  as defined in Section 2.10(d).


 


“Notes”:  the Loan Notes and the Exchange Notes, as
originally executed or as subsequently amended from time to time pursuant to
the applicable provisions hereof.


 


“Officer”:  the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Financial Officer, any Vice President, the
Treasurer or the Secretary of the Company. Officer of any Subsidiary Guarantor
has a correlative meaning.


 


“Officer’s Certificate”:  a certificate signed by two Officers or by an
Officer and either an Assistant Treasurer or an Assistant Secretary of the
Company.


 


“Opinion of Counsel”:  a written opinion from legal counsel who is
reasonably acceptable to the Administrative Agent. The counsel may be an
employee of or counsel to Holdings, the Company or the Administrative Agent.


 


“Original Initial Note”:  as defined in Section 9.6(e).


 


“Original Term Note”:  as defined in Section 9.6(e).


 


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


 


“Participant”:  as defined in Section 9.6(c).


 


“Payment Default”:  as defined in Section 7(e).


 


“PBGC”:  the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA (or any successor
thereto).


 


“Permitted
Holders”: the Sponsor.  Any
person or group whose acquisition of beneficial ownership constitutes a Change
of Control will thereafter, together with any of its Affiliates, constitute
additional Permitted Holders.


 


18

















 


“Permitted Investment”: an Investment by
the Company or any Subsidiary in:


 


(i)            the Company or a Subsidiary (including the Capital Stock of a
Subsidiary);


 


(ii)           cash and Cash Equivalents;


 


(iii)          receivables owing to the Company or any Subsidiary
created or acquired in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms; provided, however, that such trade terms
may include such concessionary trade terms as the Company or any such
Subsidiary deems reasonable under the circumstances;


 


(iv)          payroll, travel and similar advances to cover matters that
are expected at the time of such advances ultimately to be treated as expenses
for accounting purposes and that are made in the ordinary course of business;


 


(v)           loans or advances to employees, officers or directors of the
Company or any Subsidiary of the Company in the ordinary course of business
consistent with past practices, in an aggregate amount not in excess of
$1,000,000 at any one time outstanding;


 


(vi)          Capital Stock, obligations or securities received in
settlement of debts created in the ordinary course of business and owing to the
Company or any Subsidiary, or as a result of foreclosure, perfection or
enforcement of a Lien, or in satisfaction of judgments or pursuant to any plan
of reorganization or similar arrangement upon the bankruptcy or insolvency of a
debtor;


 


(vii)         Investments (x) made as a result of the receipt
of noncash consideration from an Asset Disposition that was made pursuant to
and in compliance with Section 6.4 or (y) made to effect Restricted
Payments expressly permitted by Section 6.2 or Dispositions expressly
permitted by Section 6.4;


 


(viii)        Investments in existence on or made pursuant to
legally binding commitments in existence on the Closing Date;


 


(ix)           Currency Agreements, Interest Rate Agreements, Fuel
Protection Agreements and related Hedging Obligations, which transactions or
obligations are Incurred in compliance with Section 6.1;


 


(x)            Guarantees issued in accordance with Section 6.1 and
(other than respect to Indebtedness) guarantees, keepwells and similar
arrangements made in the ordinary course of business;


 


(xi)           Investments in an amount not to exceed $5,000,000 in the
aggregate at any one time outstanding in connection with Investments in travel
or airline related businesses made in connection with marketing and promotion
agreements, alliance agreements, distribution agreements, agreements with
respect to fuel consortiums, agreements relating to flight training, agreements
relating to insurance arrangements, agreements relating to parts management
systems and other similar agreements;


 


19

















 


(xii)                             deposits in
connection with the acquisition or maintenance of aircraft in the ordinary
course of business or customary in the airline industry;


 


(xiii)                          pledges or
deposits with respect to leases (other than leases of aircraft) or utilities
provided to third parties in the ordinary course of business or Liens otherwise
described in the definition of “Permitted Liens” or made in connection with
Liens permitted under Section 6.5;


 


(xiv)        any Investment to the extent made using Capital
Stock of the Company (other than Disqualified Stock) or Capital Stock of any
direct or indirect parent company as consideration;


 


(xv)         Investments consisting of purchases and acquisitions
of inventory, supplies, materials and equipment or licenses or leases of
intellectual property, in each case in the ordinary course of business; and


 


(xvi)        other Investments in an amount not to exceed
$1,000,000 in the aggregate at any one time outstanding.


 


“Permitted Liens”: with
respect to any Person:


 


(i)            Liens incurred or pledges or deposits made by such Person
under workers’ compensation laws, unemployment insurance laws, social security
laws or similar legislation, or insurance related obligations (including
pledges or deposits securing liability to insurance carriers under insurance or
self-insurance arrangements), to secure performance in connection with bids,
tenders, contracts (other than for the payment of Indebtedness) or leases to
which such Person is a party, or public or statutory obligations of such Person
to secure surety or appeal bonds to which such Person is a party, or deposits
as security for contested taxes or import or customs duties or for the payment
of rent, in each case Incurred in the ordinary course of business;


 


(ii)           Liens imposed by law, including carriers’, warehousemen’s,
mechanics’, materialmen’s and repairmen’s Liens, in each case for sums not yet
due or that are bonded or being contested in good faith by appropriate
proceedings if a reserve or other appropriate provisions, if any, as shall be
required by GAAP shall have been made in respect thereof;


 


(iii)          Liens for taxes, assessments or other governmental
charges not yet subject to penalties for non-payment or which are being
contested in good faith by appropriate proceedings; provided that
appropriate reserves required pursuant to GAAP have been made in respect
thereof;


 


(iv)          Liens in favor of issuers of surety, performance or other
bonds or guarantees or letters of credit or bankers’ acceptances issued
pursuant to the request of and for the account of such Person in the ordinary
course of its business; provided, however,
that such letters of credit do not support Indebtedness;


 


(v)           encumbrances, ground leases, easements or reservations of, or
rights of others for, licenses, rights of way, sewers, electric lines,
telegraph and telephone lines and other similar purposes, or zoning, building
codes or other restrictions


 


20

















 


(including, without
limitation, minor defects or irregularities in title and similar encumbrances)
as to the use of real properties or liens incidental to the conduct of the business
of such Person or to the ownership of its properties which do not in the
aggregate materially adversely affect the value of said properties or
materially impair their use in the operation of the business of such Person;


 


(vi)          Liens securing Hedging Obligations so long as
any related Indebtedness is, and is permitted to be under this Agreement,
secured by a Lien on the same property securing such Hedging Obligation;


 


(vii)         leases, licenses, subleases and sublicenses
of assets (including, without limitation, real property and intellectual
property rights) which do not materially interfere with the ordinary conduct of
the business of the Company or any of its Subsidiaries;


 


(viii)        judgment Liens not giving rise to an Event of
Default;


 


(ix)                                Liens for the purpose of securing
Indebtedness represented by Capitalized Lease Obligations, mortgage financings,
purchase money obligations or other payments Incurred to finance all or any
part of the purchase price or cost of construction or improvement of assets or property
(other than Capital Stock or other Investments) acquired, constructed or
improved in the ordinary course of business; provided that:


 


(A)          the aggregate principal amount of
Indebtedness secured by such Liens is otherwise permitted to be Incurred under
this Agreement and does not exceed the cost of the assets or property so
acquired, constructed or improved; and


 


(B)           such Liens are created within 180 days of
construction, acquisition or improvement of such assets or property and do not
encumber any other assets or property of the Company or any Subsidiary other
than such assets or property and assets affixed or appurtenant thereto;


 


(x)            Liens arising solely by virtue of any
statutory or common law provisions relating to banker’s Liens, rights of set-off
or similar rights and remedies as to deposit accounts or other funds maintained
with a depositary institution; provided that:


 


(A)          such deposit account is not a dedicated cash
collateral account and is not subject to restrictions against access by the Company
in excess of those set forth by regulations promulgated by the Federal Reserve
Board; and


 


(B)           such deposit account is not intended by the
Company or any Subsidiary to provide collateral to the depository institution;


 


(xi)                                Liens arising from Uniform Commercial Code
financing statement filings (or similar filings in other applicable
jurisdictions) regarding operating leases entered into by the Company and its
Subsidiaries in the ordinary course of business;


 


(xii)                             Liens existing on the Closing Date and set
forth on Schedule 6.5;


 


21

















 


(xiii)                          Liens on
property, other assets or shares of stock of a Person at the time such Person
becomes a Subsidiary; provided, however,
that such Liens are not created, Incurred or assumed in connection with, or in
contemplation of, such other Person becoming a Subsidiary; provided further, however, that any such
Lien may not extend to any other property owned by the Company or any
Subsidiary;


 


(xiv)        Liens on property or other
assets at the time the Company or a Subsidiary acquired the property or assets,
including any acquisition by means of a merger, consolidation or other
combination with or into the Company or any Subsidiary; provided, however, that such Liens are not
created, Incurred or assumed in connection with, or in contemplation of, such
acquisition; provided further, however,
that such Liens may not extend to any other property owned by the Company or
any Subsidiary;


 


(xv)         Liens securing Indebtedness
or other obligations of the Company or a Subsidiary owing to the Company or
another Subsidiary;


 


(xvi)        Liens securing the Loans and
Guarantees under the Guarantee and Collateral Agreement or any obligations
owing to the Administrative Agent under this Agreement or the other Loan
Documents;


 


(xvii)       Liens securing Refinancing
Indebtedness Incurred to refinance, refund, replace, amend, extend or modify,
as a whole or in part, Indebtedness that was previously so secured pursuant to
clauses (ix), (xii), (xiii), (xiv), (xvi) and (xvii) of this definition; provided
that any such Lien is limited to all or part of the same property or assets
(plus improvements, accessions, proceeds or dividends or distributions in
respect thereof) that secured (or, under the written arrangements under which
the original Lien arose, could secure) the Indebtedness being refinanced or is
in respect of property that is the security for a Permitted Lien hereunder;


 


(xviii)      any interest or title of a
lessor under any Capitalized Lease Obligation or operating lease;


 


(xix)                           Liens under
industrial revenue, municipal or similar bonds;


 


(xx)                              Liens securing
Indebtedness permitted to be incurred pursuant to clauses (v) (provided
that such Liens extend only to the property so acquired, constructed or
improved) and (ix) (provided that such Liens extend only to leased
equipment subject to such “return condition”) of Section 6.1(a);


 


(xxi)                           Liens securing
Indebtedness (other than Subordinated Obligations and Guarantor Subordinated
Obligations) and other obligations in an aggregate principal amount outstanding
at any one time not to exceed $2,500,000;


 


(xxii)                        Liens imposed
by applicable law on the assets of the Company or any Subsidiary located at an
airport for the benefit of any nation or government or national or governmental
authority of any nation, state, province or other political subdivision
thereof, and any agency, department, regulator, airport authority, air
navigation authority or other entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government
in respect


 


22

















 


of the regulation of commercial aviation or the registration,
airworthiness or operation of civil aircraft and having jurisdiction over the
Company or such Subsidiary including, without limitation, the FAA or DOT;


 


(xxiii)       deposits in
Lessor Maintenance Reserve Accounts;


 


(xxiv)       deposits
securing obligations in respect of letters of credit issued for the account of
any Group Member in the ordinary course of business, including pursuant to the
LC Credit Facility or the Wachovia Facility;


 


(xxv)        any encumbrance
or restriction (including put and call arrangements) with respect to Capital
Stock of any joint venture or similar arrangement pursuant to any joint venture
or similar arrangement;


 


(xxvi)       (A) mortgages,
liens, security interests, restrictions, encumbrances or any other matters of
record that have been placed by any government, statutory or regulatory
authority, developer, landlord or other third party on property over which the
Company or any Subsidiary has easement rights or on any leased property and
subordination or similar arrangements relating thereto and (B) any
condemnation or eminent domain proceedings affecting any real property;


 


(xxvii)      Liens on
property or assets under construction (and related rights) in favor of a
contractor or developer or arising from progress or partial payments by a third
party relating to such property or assets;


 


(xxviii)     deposits in
Trust Tax Accounts in favor of governmental taxing authorities arising as a
matter of law to secure payment of governmental taxes imposed on airline
tickets;


 


(xxix)       Liens securing
Indebtedness represented by Take-Out Debt, so long as such Liens are subject to
an intercreditor arrangement reasonably satisfactory to the Administrative
Agent; and


 


(xxx)        Liens arising
or granted in the ordinary course of business in favor of Persons performing
credit card processing services, travel charge processing services,
clearinghouse services or similar services.


 


“Person”:  an individual, partnership, corporation,
limited liability company, association, business trust, joint stock company,
trust, unincorporated association, joint venture, Governmental Authority or
other entity of whatever nature.


 


“PIK Interest Amount”:  as defined in Section 2.6(d).


 


“PIK Margin”:  75 basis points per annum.


 


“Plan”:  at a particular time, any employee benefit
plan which is covered by Title IV of ERISA and in respect of which the Company
or a Commonly Controlled Entity is (or, if such plan were terminated at such
time, would under Section 4069 of ERISA be deemed to be) an “employer” as
defined in Section 3(5) of ERISA.


 


23

















 


“Preferred Stock”:  as applied to the Capital Stock of any
corporation, Capital Stock of any class or classes (however designated) which
is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.


 


“Projections”:  as defined in Section 5.2(c).


 


“Properties”:  as defined in Section 3.17.


 


“Purchaser”:  Hugo Acquisition Corp., a Delaware corporation
and an indirect wholly owned subsidiary of Holdings and the Company.


 


“Qualified Stock”:  any Capital Stock that is not Disqualified
Stock.


 


“Real Estate Mortgages”:  each of the mortgages and deeds of trust made
by any Loan Party with respect to the Mortgaged Real Properties owned by such
Loan Party in favor of, or for the benefit of, the Administrative Agent for the
benefit of the Lenders, in form and substance satisfactory to the
Administrative Agent.


 


“Refinancing Indebtedness”:  Indebtedness that is Incurred to refund,
refinance, replace, exchange, renew, repay or extend (including pursuant to any
defeasance or discharge mechanism) (collectively, “refinance”, “refinances,” and “refinanced” shall have a correlative
meaning) any Indebtedness existing on the date of this Agreement or Incurred in
compliance with this Agreement (including Indebtedness of the Company that
refinances Indebtedness of any Subsidiary and Indebtedness of any Subsidiary
that refinances Indebtedness of another Subsidiary) including Indebtedness that
refinances Refinancing Indebtedness; provided,
however, that (i) (x) if the Stated Maturity of the
Indebtedness being refinanced is earlier than the Final Maturity Date, the
Refinancing Indebtedness has a Stated Maturity no earlier than the Stated
Maturity of the Indebtedness being refinanced or (y) if the Stated
Maturity of the Indebtedness being refinanced is later than the Final Maturity
Date, the Refinancing Indebtedness has a Stated Maturity at least 91 days later
than the Final Maturity Date, (ii) the Refinancing Indebtedness has an
Average Life at the time such Refinancing Indebtedness is Incurred that is
equal to or greater than the Average Life of the Indebtedness being refinanced,
(iii) such Refinancing Indebtedness is Incurred in an aggregate principal
amount (or if issued with original issue discount, an aggregate issue price)
that is equal to or less than the sum of the aggregate principal amount (or if
issued with original issue discount, the aggregate accreted value) then
outstanding of the Indebtedness being refinanced (plus, without duplication,
any additional Indebtedness Incurred to pay interest or premiums required by
the instruments governing such existing Indebtedness and fees and expenses
Incurred in connection therewith), (iv) if the Indebtedness being
extended, refinanced, replaced, exchanged, defeased or refunded is subordinated
in right of payment to the Loans or the Guarantees under the Guarantee and
Collateral Agreement, such Refinancing Indebtedness is subordinated in right of
payment to the Loans or the Guarantees under the Guarantee and Collateral
Agreement on terms at least as favorable to the Holders as those contained in
the documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded and (v) if the Indebtedness being
refinanced is secured, the Lien securing Refinancing Indebtedness Incurred to
refinance Indebtedness that was previously so secured is no less favorable to
the Lenders and is no more favorable to the lienholder with respect to such
Lien than the Lien in respect of the Indebtedness being refinanced.


 


“Register”:  as defined in Section 9.6(b).


 


24

















 


“Registration Rights Agreement”:
 the Registration Rights Agreement
substantially in the form of Exhibit K hereto
(with such changes therein as the Company may request and Administrative Agent
may approve, such approval not to be unreasonably withheld), as amended,
waived, supplemented or otherwise modified from time to time.


 


“Regulation U”:  Regulation U of the Board of Governors as in
effect from time to time.


 


“Related Business”:  any business which is the same as or related
to any of the businesses of the Company, the Target and their respective
Subsidiaries on the date hereof.


 


“Reorganization”:  with respect to any Multiemployer Plan, the
condition that such Multiemployer Plan is in reorganization within the meaning
of Section 4241 of ERISA.


 


“Reportable Event”:  any of the events set forth in Section 4043(c) of
ERISA and the regulations thereunder, other than those events as to which the
30-day notice period is waived.


 


“Required Lenders”:  at any time, Lenders holding more than 50% in
principal amount of outstanding Loans (or, prior to the Closing Date, more than
50% of the Commitments).


 


“Requirement of Law”:  as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of
such Person, and any present or future law, treaty, statute, rule, regulation,
common law or determination of an arbitrator or a court or other Governmental
Authority and all official directives, consents, approvals, authorizations,
guidelines, restrictions and policies of any Governmental Authority, in each
case applicable to and binding upon such Person or any of its property or to
which such Person or any of its property is subject.


 


“Responsible
Officer”:  as to any Person,
any of the following officers of such Person: (i) the chief executive
officer or the president of such Person and, with respect to financial matters,
the chief financial officer, the senior vice president–finance, the treasurer
or the controller of such Person, (ii) any vice president of such Person
or, with respect to financial matters, any assistant treasurer or assistant
controller of such Person, who has been designated in writing to the
Administrative Agent as a Responsible Officer by such chief executive officer
or president of such Person or, with respect to financial matters, such chief
financial officer of such Person, (iii) with respect to Section 5.7
and without limiting the foregoing, the general counsel of such Person and (iv) with
respect to ERISA matters, the senior vice president–human resources (or
substantial equivalent) of such Person.


 


“Restricted Investment”:  any Investment other than a Permitted
Investment.


 


“Restricted Payment”:  as defined in Section 6.2(a).


 


“Routes”:  the routes for which the Company or, if
applicable, a Subsidiary Guarantor, holds or hereafter acquires the requisite
authority to operate foreign air transportation pursuant to Title 49 including,
without limitation, applicable frequencies, exemption and certificate
authorities, Fifth-Freedom Rights and “behind/beyond rights”.


 


“Sale/Leaseback
Transaction”:  an arrangement
relating to property now owned or hereafter acquired by the Company or a
Subsidiary whereby the Company or such Subsidiary transfers such property to a
Person and the Company or such Subsidiary leases it from such Person.


 


25

















 


“SEC”:  the Securities and Exchange Commission or any
Governmental Authority which succeeds to the powers and functions thereof.


 


“Secured Parties”: as
defined in the Guarantee and Collateral Agreement.


 


“Securities”:  any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in any
profit sharing agreement or arrangement, bonds, debentures, options, warrants,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as “securities”
or any certificates of interest, shares or participations in temporary or
interim certificates for the purchase or acquisition of, or any right to
subscribe to, purchase or acquire, any of the foregoing.


 


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


 


“Securities Demand”:  as defined in Section 5.9(a).


 


“Security Documents”:  the collective reference to the Guarantee and
Collateral Agreement, the Aircraft Mortgages, the Real Estate Mortgages and all
other security documents hereafter delivered to the Administrative Agent
granting a Lien on any property of any Person to secure the obligations and
liabilities of any Loan Party under any Loan Document.


 


“Senior ATA Notes”: the
senior notes to be issued by the Company in an aggregate principal amount not
to exceed $340,000,000.


 


“Significant Subsidiary”:
 any Subsidiary that would be a “Significant
Subsidiary” of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the SEC.


 


“Single Employer Plan”:  any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan.


 


“Solvent” and “Solvency”: 
with respect to any Person on a particular date, that on such date, (i) the
fair value of the property of such Person is greater than the total amount of
liabilities, including, without limitation, contingent liabilities, of such
Person, (ii) the present fair saleable value of the assets of such Person
is not less than the amount that will be required to pay the probable liability
of such Person on its debts as they become absolute and matured, (iii) such
Person does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person’s ability to pay as such debts and liabilities
mature and (iv) such Person is not engaged in business or a transaction,
and is not about to engage in business or a transaction, for which such Person’s
property would constitute an unreasonably small amount of capital.


 


“Specified Aircraft”:  the numbers and types of aircraft listed on
Schedule 1.1D together with related engines or spare engines, spare parts or
other related equipment (including ground equipment).


 


“Specified Representations”:  the representation set forth in Sections
3.3(a), 3.4, 3.11, and 3.14.


 


“Sponsor”:
 MatlinPatterson Global Advisers LLC and
its Affiliates but not including, however, any portfolio companies thereof.


 


26

















 


“Stated Maturity”:  with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision, but shall not include any contingent obligations to
repay, redeem or repurchase any such principal prior to the date originally
scheduled for the payment thereof.


 


“Subordinated Obligation”:  any Indebtedness of the Company (whether
outstanding on the date of this Agreement or thereafter Incurred) which is
subordinate or junior in right of payment to the Loans pursuant to a written
agreement.


 


“Subsequent Initial Note”:  as defined in Section 9.6(e).


 


“Subsequent Term Note”:  as defined in Section 9.6(e).


 


“Subsidiary”
of any Person means: (a) any corporation, association or other business
entity (other than a partnership, joint venture, limited liability company or
similar entity) of which more than 50% of the total ordinary voting power of
shares of Capital Stock entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
(or persons performing similar functions) or (b) any partnership, joint
venture limited liability company or similar entity of which more than 50% of
the capital accounts, distribution rights, total equity and voting interests or
general or limited partnership interests, as applicable, is, in the case of
clauses (a) and (b), at the time owned or controlled, directly or
indirectly, by (1) such Person, (2) such Person and one or more
Subsidiaries of such Person or (3) one or more Subsidiaries of such
Person. Unless otherwise specified herein, each reference to a Subsidiary will
refer to a Subsidiary of the Company.


 


“Subsidiary Guarantor”:  each Domestic Subsidiary in existence on the
Closing Date that provides a Guarantee pursuant to the Guarantee and Collateral
Agreement on the Closing Date (and any other Domestic Subsidiary that provides
a Guarantee under the Guarantee and Collateral Agreement in accordance with
this Agreement); provided that upon release or discharge of such
Domestic Subsidiary from its Guarantee under the Guarantee and Collateral
Agreement in accordance with this Agreement, such Domestic Subsidiary ceases to
be a Subsidiary Guarantor.


 


“Supporting Route Facilities”:
 gates, ticket counters and other
facilities assigned, allocated, leased, or made available to the Company at
non-U.S. airports used in the operation of scheduled service over a Route.


 


“Take-Out Debt”:  cash pay or non-cash pay securities, senior
or subordinated securities, discount issue securities or a combination of any
of the foregoing issued by the Company and/or Holdings to refinance the Loans
or Exchange Notes.


 


“Target”:  World Air Holdings, Inc., a Delaware
corporation.


 


“Target
Company Material Adverse Effect”:  any change, effect, event, occurrence,
development, circumstance, condition or worsening thereof (an “Effect”) that, individually or when taken
together with all other Effects that exist at the date of determination, (A) has
or is reasonably likely to have a material adverse effect on the properties,
assets, liabilities, condition (financial or otherwise), business or results of
operations of the Target and the Target’s Subsidiaries, taken as a whole or (B) prevents
or materially delays the Target from performing its obligations under the
Merger Agreement in any material respect or materially delays consummating the
transactions or would reasonably be expected to have such effect; provided,


 


27

















 


however, that no Effects resulting from,
relating to or arising out of the following shall be deemed to be or constitute
a Target Material Adverse Effect, and no Effects resulting from, relating to or
arising out of the following shall be taken into account when determining
whether a Target Material Adverse Effect has occurred or is reasonably likely
to exist: (i) conditions (or changes therein) in any industry or
industries in which the Target operates (other than any such conditions (or
changes therein) resulting from, relating to or arising out of acts of
terrorism, which shall not be excluded and may be taken into account) to the
extent that such conditions do not have a materially disproportionate effect on
the Target and the Target’s Subsidiaries, taken as a whole, (ii) general
economic conditions (or changes therein) in the United States, in any country
in which the Target or any of the Target’s Subsidiaries conducts business or in
the global economy as a whole (other than any such general economic conditions
(or changes therein) resulting from, relating to or arising out of acts of
terrorism, which shall not be excluded and may be taken into account) to the
extent that such conditions do not have a materially disproportionate effect on
the Target and the Target’s Subsidiaries, taken as a whole, (iii) any
generally applicable change in Law or GAAP or interpretation of any of the
foregoing to the extent that such conditions do not have a materially
disproportionate effect on the Target and the Target’s Subsidiaries, taken as a
whole, (iv) Effects primarily related to the announcement of the execution
of the Merger Agreement or the pendency of the Merger, (v) compliance with
the terms of, or the taking of any action required by, the Merger Agreement, or
the failure to take any action prohibited by this Agreement and (vi) any
actions taken, or failure to take action, to which Holdings or Purchaser has
expressly consented or requested.


 


“Term Loan”:  as defined in Section 2.1(b).


 


“Term Notes”:  as defined in Section 9.6(e).


 


“Title 49”:  Title 49 of the United States Code, which,
among other things, recodified and replaced the U.S. Federal Aviation Act of
1958, and the rules and regulations promulgated pursuant thereto or any
subsequent legislation that amends, supplements or supersedes such provisions.


 


“Transaction Documents”:  the collective reference to the Merger
Documents, Loan Documents, the Indenture and the Exchange Notes.


 


“Transactions”:  the collective reference to the Merger, the
issuances of Indebtedness under this Agreement, the Indenture, and the Take-Out
Debt.


 


“Transferee”:  any Assignee or Participant.


 


“Treasury Rate”:  with respect to each day, the rate per annum
determined by the Administrative Agent two days prior to (i) the Closing
Date for the Interest Period commencing on the Closing Date and (ii) thereafter,
the last day of the next preceding Interest Period as (x) the rate borne
by direct obligations of the United States maturing on the eighth anniversary
of the first day of the relevant Interest Period or (y) if there are no
such obligations, the rate determined by linear interpolation between the rates
borne by the two direct obligations of the United States maturing closest to,
but straddling, the eighth anniversary of the first day of the relevant
Interest Period, in each case as most recently published by the Board of
Governors on or prior to such date of determination.


 


“Trust Tax Accounts”:  trust tax accounts that hold deposits relating
to transportation ticket taxes and fees, including, but not limited to, federal
excise tax and passenger facility


 


28

















 


charges, collected from passengers until such time as such amounts are
remitted to the applicable governmental agency.


 


“Trustee”:  as defined in Section 5.10(a).


 


“Underfunding”:  the excess of the present value of all
accrued benefits under a Plan (based on those assumptions used to fund such
Plan), determined as of the most recent annual valuation date, over the value
of the assets of such Plan allocable to such accrued benefits.


 


“Voting Stock”:  of any Person as of any date, the Capital
Stock of such Person that is as of such time entitled to vote in the election
of the Board of Directors of such Person.


 


“Wachovia Facility”:  the Credit Agreement, dated as of March 30,
2006, among World Airways, Inc., North American Airlines, Inc., each
of the financial institutions initially a signatory thereto, together with
those assignees pursuant thereto and Wachovia Bank, National Association,
including any letter of credit facility that replaces or refinances the letter
of credit facility under such credit agreement which is unsecured or, if
secured, secured only by the deposits described in clause (xxiv) of the
definition of Permitted Liens.


 


“WAI”:  World Airways, Inc., a Delaware
corporation.


 


“Warrant Agreement”:  the Warrant Agreement, substantially in the
form of Exhibit J (with such
changes as the Company may request and Administrative Agent may approve, such
approval not to be unreasonably withheld), to be executed and delivered by
Holdings and JPMorgan Chase Bank, N.A., as warrant agent with respect to the
Warrants.


 


“Warrants”:  the warrants of Holdings as described in the
Warrant Agreement.


 


“Warrant
Shares”:  the shares
of Common Stock of Holdings to be issued and received, as the case may be, upon
exercise of the Warrants.


 


1.2     Other
Definitional Provisions.  (a) Unless
otherwise specified therein, all terms defined in this Agreement shall have the
defined meanings when used in the other Loan Document or any certificate or
other document made or delivered pursuant hereto or thereto.


 


(b)     As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or thereto, (i) accounting
terms relating to any Group Member not defined in Section 1.1 and
accounting terms partly defined in Section 1.1, to the extent not defined,
shall have the respective meanings given to them under GAAP, (ii) the
words “include”, “includes” and “including” shall be deemed to be followed by
the phrase “without limitation”, (iii) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, Capital
Stock, securities, revenues, accounts, leasehold interests and contract rights,
and (iv) references to agreements or other Contractual Obligations shall,
unless otherwise specified, be deemed to refer to such agreements or
Contractual Obligations as amended, supplemented, restated or otherwise
modified from time to time.


 


(c)     The words “hereof”, “herein” and “hereunder” and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
Schedule, Annex and Exhibit references are to this Agreement unless
otherwise specified.


 


29














 


(d)     The
meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.


 


SECTION 2.
AMOUNT AND TERMS OF LOANS


 


2.1     Loans.  (a) Subject
to the terms and conditions hereof, each Lender severally agrees to make a loan
(individually, an “Initial Loan”
and collectively, the “Initial Loans”)
to the Company on the Closing Date, in an aggregate principal amount equal to
such Lender’s Commitment.  Any
Commitments not drawn on the Closing Date shall terminate.


 


(b)     Subject to the terms and conditions hereof,
each Lender severally agrees, if the Initial Loans have not been repaid or
exchanged for Exchange Notes on the Initial Maturity Date, to convert the then
outstanding principal amount of its Initial Loans into a loan (individually, a “Term Loan” and collectively, the “Term Loans”; the Initial Loans and the
Term Loans, collectively, the “Loans”)
to the Company, on the Initial Maturity Date, in an aggregate principal amount
equal to the then outstanding principal amount of the Initial Loans held by
such Lender. Upon the making by such Lender of such Term Loan, each Lender
shall cancel on its records a principal amount of the Initial Loans held by
such Lender corresponding to the principal amount of Term Loans made by such
Lender, which corresponding principal amount of the Initial Loans shall be
satisfied by the conversion thereof into Term Loans.


 


(c)     Each Lender may at its option make any Loan
by causing any domestic or foreign branch or Affiliate of such Lender to make
such Loan; provided that any exercise of such option shall not affect
the obligation of the Company to repay such Loan in accordance with the terms
of this Agreement.


 


(d)     The failure of any Lender to make the
Initial Loan to be made by it shall not relieve any other Lender of its
obligation, if any, hereunder to make its Initial Loan on the Closing Date, but
no Lender shall be responsible for the failure of any other Lender to make the
Initial Loan to be made by such other Lender on the Closing Date.


 


2.2     Procedure
for Borrowing.  The Company
shall give the Administrative Agent notice (which notice must be received by
the Administrative Agent prior to 10:00 a.m., New York City time, three
Business Days prior to the anticipated Closing Date and may be conditioned on
the occurrence of the Closing Date) requesting that the Lenders make the
Initial Loans on the Closing Date and specifying the amount to be borrowed.
Upon receipt of such notice the Administrative Agent shall promptly notify each
Lender thereof. Not later than 9:00 a.m., New York City time, on the
Closing Date each Lender shall make available to the Administrative Agent at
its office specified in Section 9.2 an amount in immediately available
funds equal to the Initial Loans to be made by such Lender.  The Administrative Agent shall credit the
account of the Company on the books of such office of the Administrative Agent
with the aggregate of the amounts made available to the Administrative Agent by
the Lenders in immediately available funds.


 


2.3     Maturity
and Exchange Notes.  (a) Subject
to Section 2.1(b), all the Initial Loans will mature on the Initial
Maturity Date.


 


(b)     All the Term Loans will mature on the Final
Maturity Date.


 


(c)     Each Lender will have the option on or
after the Initial Maturity Date at any time or from time to time to receive
Exchange Notes in exchange for all or any portion of its Term Loan or, on the
Initial Maturity Date, its Initial Loan, then outstanding in accordance with Section 5.10
of this Agreement.  The principal amount
of the Exchange Notes will equal 100.0% of the aggregate principal amount
(including any accrued and unpaid interest not required to be paid in cash) of
the Loans for which


 


30

















 


they are exchanged.
If a Default (but not an Event of Default) shall have occurred and be
continuing on the date of such exchange, any notices given or cure periods
commenced while the Loan was outstanding shall be deemed given or commenced (as
of the actual dates thereof) for all purposes with respect to the Exchange Note
(with the same effect as if the Exchange Note had been outstanding as of the
actual dates thereof).


 


2.4     Repayment
of Loans.  Subject to Section 2.1(b),
the Company hereby unconditionally promises to pay to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each Loan in
accordance with the terms hereof and of the Loan Notes. The Company hereby
further agrees to pay to the Administrative Agent for the account of each
Lender interest on the unpaid principal amount of the Loans from time to time
outstanding from the date hereof until payment in full thereof at the rates per
annum, in the manner, and on the dates, set forth in Section 2.6.


 


2.5     Optional
and Mandatory Prepayments.  (a) The
Company may at any time and from time to time prepay the Loans, in whole or in
part, without premium or penalty, upon irrevocable notice delivered to the
Administrative Agent at least three Business Days prior thereto, which notice shall
specify the date and amount of prepayment, provided
that if a Loan is prepaid on any day other than the last day of the
Interest Period applicable thereto, the Company shall be obligated to pay any
amounts owing pursuant to Section 2.11; provided,
further, that on or after the
Initial Maturity Date, any prepayment shall be applied as provided in Section 2.5(c) below.  Upon receipt of any such notice the
Administrative Agent shall promptly notify each relevant Lender thereof. If any
such notice is given, the amount specified in such notice shall be due and
payable on the date specified therein, together with accrued interest to such
date on the amount prepaid. Partial prepayments of Loans shall be in an
aggregate principal amount equal to the lesser of (A) $1,000,000, or a
whole multiple thereof and (B) the aggregate unpaid principal amount of
the Loans.


 


(b)     (i) If, subsequent to the Closing
Date, the Company or any of its Subsidiaries shall issue the Take-Out Debt or
any Indebtedness (other than Indebtedness permitted pursuant to Section 6.1(a))
or Capital Stock (other than shares of Capital Stock of a Subsidiary issued to
the Company or any Subsidiary of the Company), an amount equal to 100% of the
Net Cash Proceeds thereof shall be promptly applied toward the prepayment of
the Loans as provided in Section 2.5(c) below.


 


(ii)         If, subsequent to the
Closing Date, the Company or any of its Subsidiaries shall be required to apply
any Net Available Cash pursuant to Section 6.4, an amount equal to such
Net Available Cash shall be promptly applied toward the prepayment of the Loans
as provided in Section 2.5(c) below.


 


(iii)       
If the Loans would otherwise constitute “applicable high yield discount
obligations” within the meaning of Section 163(i)(1) of the Code, on
the first Interest Payment Date that occurs after the fifth anniversary of the
Closing Date (the “AHYDO Prepayment Date”),
the Company shall be required to prepay a portion of each Loan then outstanding
equal to the “Mandatory Principal Prepayment
Amount” (such prepayment, a “Mandatory
Principal Prepayment”).  The “Mandatory Principal Prepayment Amount”
means the portion of a Loan required to be redeemed to prevent such Loan from
being treated as an “applicable high yield discount obligation” within the
meaning of Section 163(i)(1) of the Code. No partial prepayment of
the Loans prior to the AHYDO Prepayment Date pursuant to any other provision of
this Agreement will alter the Company’s obligation to make the Mandatory
Principal Prepayment with respect to any Loans that remain outstanding on the
AHYDO Prepayment Date. For the avoidance of doubt, the Mandatory Principal
Prepayment Amount shall be determined by the Company and provided to the
Administrative Agent in the form of an Officer’s Certificate on which the
Administrative Agent may conclusively rely.


 


31

















 


(iv)    The Company shall give the Administrative
Agent (which shall promptly notify each Lender) at least one Business Day’s
prior notice or, telephone notice promptly confirmed in writing of each
prepayment in whole or in part pursuant to this Agreement setting forth the
date and amount thereof.


 


(c)     As promptly as practicable after the
Administrative Agent receives notice of a prepayment pursuant to Section 2.5(b)(iv),
the Administrative Agent shall notify each Lender thereof including the amount
and the expected date of such prepayment. 
Promptly upon receipt of any prepayment, the Administrative Agent shall
distribute such prepayment in accordance with Section 2.8(b).  Any such prepayment after the Cash Pay Date
shall be accompanied by the payment of interest (if any) accrued on the amount
of such prepayment after the Cash Pay Date.


 


(d)     (d)   Notwithstanding
anything to the contrary contained in this Agreement, the Company may rescind
any notice of prepayment under this Section 2.5 if such prepayment would
have resulted from a refinancing of all or any portion of the Loans, which
refinancing shall not be consummated or shall otherwise be delayed.


 


(e)     Notwithstanding any of the provisions of Section 2.5,
so long as no Event of Default shall have occurred and be continuing, if any
prepayment of Loans is required to be made under Section 2.5(b), other
than on the last day of the Interest Period therefor, the Company may, in its
sole discretion, deposit the amount of any such prepayment otherwise required
to be made thereunder into a cash collateral account until the last day of such
Interest Period, at which time the Administrative Agent shall be authorized
(without any further action by or notice to or from any Loan Party) to apply
such amount to the prepayment of such Loans in accordance with Section 2.5(c).
Upon the occurrence and during the continuance of any Event of Default, the
Administrative Agent shall also be authorized (without any further action by or
notice to or from any Borrower or any other Loan Party) to apply such amount to
the prepayment of the outstanding Loans in accordance with Section 2.5(c).


 


2.6     Interest Rates and Payment Dates.  (a) Initial Loans shall bear interest for
the period from and including the date such Initial Loans are made to, but
excluding, the Initial Maturity Date on the unpaid principal thereof at a rate
per annum equal to the Initial Loan Rate for the Interest Period in effect for
such Initial Loans plus the Applicable Margin plus the PIK Margin.


 


(b)     Term Loans shall bear interest for the
period from and including the Initial Maturity Date to, but excluding, the
Final Maturity Date or date of exchange for an Exchange Note on the unpaid
principal thereof at a rate per annum equal to the Adjusted Rate plus the
Adjusted Margin plus, prior to the Cash Pay Date, the PIK Margin.


 


(c)     Notwithstanding Sections 2.6(a) and
(b), the interest rate borne by the Loans (excluding the PIK Margin) shall not
exceed 12.88% per annum.


 


(d)     Interest shall be payable in arrears on
each Interest Payment Date, provided that
interest accruing pursuant to paragraph (e) below shall be payable from
time to time on demand. On each Interest Payment Date prior to the Cash Pay
Date, the Company shall be deemed to have paid the interest accrued on the
Loans to and including the Cash Pay Date that is due on such Interest Payment
Date through an automatic increase in the principal amount of the applicable
Loans equal to the amount of such interest (the “PIK Interest Amount”).


 


(e)     If all or a portion of (i) the
principal amount of any of the Loans, (ii) any interest payable thereon,
or (iii) any commitment fee or other amount payable hereunder shall not be
paid when due (whether at the stated maturity, by acceleration or otherwise,
but taking into account any applicable


 


32

















 


grace period under Section 7(a)), such
overdue amount shall, without limiting the rights of the Lenders under Section 7,
bear interest at a rate per annum which is (x) in the case of overdue
principal, the rate that would otherwise be applicable thereto pursuant to the
foregoing provisions of this Section plus 2% or (y) in the case of
overdue interest, commitment fees or other amounts due and payable hereunder,
the applicable rate hereunder for any Loan (but without giving effect to the
foregoing clause (x)) plus 2%.


 


2.7     Computation of Interest and Fees.  (a) Interest, fees and commissions
payable pursuant hereto shall be calculated on the basis of a 360-day year for
the actual days elapsed. The Administrative Agent shall as soon as practicable
notify the Company and the relevant Lenders of each determination of the
Initial Loan Rate. The Administrative Agent shall as soon as practicable notify
the Company and the relevant Lenders of the effective date and the amount of
each such change in interest rate.


 


(b)     Each
determination of an interest rate by the Administrative Agent pursuant to any
provision of this Agreement shall be conclusive and binding on the Company and
the Lenders in the absence of manifest error. The Administrative Agent shall,
at the request of the Company, deliver to the Company a statement showing the
quotations used by the Administrative Agent in determining any interest rate
pursuant to Sections 2.6(a) and (b).


 


2.8     Pro Rata Treatment and Payments.  (a) Except to the extent otherwise
provided herein, the borrowing of Loans by the Company from the Lenders and any
reduction of the Commitments of the Lenders hereunder shall be made pro rata according to the relevant
Commitment Percentages of the Lenders with respect to the Loans borrowed or the
Commitments to be reduced.


 


(b)     Each payment (including each prepayment) by
the Company on account of principal of and interest on the Loans shall be made pro rata according to the respective
outstanding principal amounts of the Loans then held by the Lenders.


 


(c)     All payments (including prepayments) to be
made by the Company hereunder, whether on account of principal, interest, fees
or otherwise, shall be made without setoff or counterclaim and shall be made
prior to 2:00 p.m., New York City time, on the due date thereof to the
Administrative Agent, for the account of the Lenders at the Administrative
Agent’s office specified in Section 9.2, in lawful money of the United
States of America and in immediately available funds.  The Administrative Agent shall promptly
distribute such payments in accordance with the provisions of this Section 2.8
to each relevant Lender upon receipt in like funds as received, net of any
amounts owing by such Lender pursuant to Section 8.7.  All payments received by the Administrative
Agent after 2:00 p.m., New York City time, shall in each case be deemed
received on the next succeeding Business Day and any applicable interest or fee
shall continue to accrue. If any payment hereunder becomes due and payable on a
day other than a Business Day, such payment shall be extended to the next
succeeding Business Day.  In the case of
any extension of any payment of principal pursuant to the preceding two
sentences, interest thereon shall be payable at the then applicable rate during
such extension.


 


(d)     Unless the Administrative Agent shall have
been notified in writing by any Lender prior to the Closing Date that such
Lender will not make the amount that would constitute its share of such
borrowing available to the Administrative Agent, the Administrative Agent may
assume that such Lender is making such amount available to the Administrative
Agent, and the Administrative Agent may, in reliance upon such assumption, make
available to the Company a corresponding amount.  If such amount is not made available to the
Administrative Agent by the required time on the Closing Date, such Lender
shall pay to the Administrative Agent, on demand, such amount with interest
thereon at a rate equal to the greater of (i) the Federal Funds Effective
Rate and (ii) a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation, for the


 


33

















 


period until such Lender makes such amount
immediately available to the Administrative Agent. A certificate of the
Administrative Agent submitted to any Lender with respect to any amounts owing
under this Section 2.8(c) shall be conclusive in the absence of
manifest error.  If such Lender’s share
of such borrowing is not made available to the Administrative Agent by such
Lender within three Business Days of the Closing Date, the Administrative Agent
shall also be entitled to recover such amount with interest thereon at the rate
per annum applicable to such borrowing, on demand, from the Company.


 


(e)     Unless the Administrative Agent shall have
been notified in writing by the Company prior to the date of any payment due to
be made by the Company hereunder that the Company will not make such payment to
the Administrative Agent, the Administrative Agent may assume that the Company
is making such payment, and the Administrative Agent may, but shall not be
required to, in reliance upon such assumption, make available to the Lenders
their respective pro rata shares
of a corresponding amount. If such payment is not made to the Administrative
Agent by the Company within three Business Days after such due date, the
Administrative Agent shall be entitled to recover, on demand, from each Lender
to which any amount which was made available pursuant to the preceding
sentence, such amount with interest thereon at the rate per annum equal to the
daily average Federal Funds Effective Rate. Nothing herein shall be deemed to
limit the rights of the Administrative Agent or any Lender against the Company.


 


2.9     Requirements of Law.  (a) If the adoption of or any change in
any Requirement of Law or in the interpretation or application thereof or
compliance by any Lender with any request or directive (whether or not having
the force of law) from any central bank or other Governmental Authority made
subsequent to the date hereof:


 


(i)     shall subject any Lender to any tax of any
kind whatsoever with respect to this Agreement or any other Loan Document or
change the basis of taxation of payments to such Lender in respect thereof
(except for Non-Excluded Taxes covered by Section 2.10 below and changes in the rate of tax on
the overall net income of such Lender);


 


(ii)    shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any office
of such Lender which is not otherwise included in the determination of the
Adjusted LIBO Rate hereunder; or


 


(iii)   shall impose on such Lender any other condition;


 


and the result of any of the foregoing is to
increase the cost to such Lender, by an amount which such Lender deems to be
material, of making, continuing, or maintaining Eurodollar Loans or to reduce
any amount receivable hereunder in respect thereof, then, in either case, the
Company shall promptly pay such Lender, upon its demand, any additional amounts
necessary to compensate such Lender for such increased cost or reduced amount
receivable.  If any Lender becomes
entitled to claim any additional amounts pursuant to Section 2.9(a), it
shall promptly notify the Company (with a copy to the Administrative Agent) of
the event by reason of which it has become so entitled.


 


(b)     A
certificate as to any additional amounts payable pursuant to this Section 2.9
submitted by any Lender to the Company (with a copy to the Administrative
Agent) shall be conclusive in the absence of manifest error. Notwithstanding
anything to the contrary in this Section 2.9, the Company shall not be
required to compensate a Lender pursuant to this Section 2.9 for any
amounts incurred more than six months prior to the date that such Lender
notifies the Company of such Lender’s intention to claim compensation therefor;
and provided that, if the circumstances giving rise to such claim have a


 


34

















 


retroactive
effect, then such six-month period shall be extended to include the period of
such retroactive effect. The obligations of the Company pursuant to this Section 2.9
shall survive the termination of this Agreement and the payment of the Loans
and all other amounts payable hereunder.


 


2.10   Taxes.  (a)    All
payments made by the Company under this Agreement shall be made free and clear
of, and without deduction or withholding for or on account of, any present or
future income, stamp or other taxes, levies, imposts, duties, charges, fees,
deductions or withholdings, now or hereafter imposed, levied, collected,
withheld or assessed by any Governmental Authority, excluding net income taxes
and franchise taxes (imposed in lieu of net income taxes) imposed on the Administrative Agent or any Lender as a
result of a present or former connection between the Administrative Agent or
such Lender and the jurisdiction of the Governmental Authority imposing such
tax or any political subdivision or taxing authority thereof or therein (other
than any such connection arising solely from the Administrative Agent or such
Lender having executed, delivered or performed its obligations or received a payment
under, or enforced, this Agreement or any other Loan Document).  If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings (“Non-Excluded Taxes”)
or Other Taxes are required to be withheld from any amounts payable to the
Administrative Agent or any Lender hereunder, the amounts so payable to the
Administrative Agent or such Lender shall be increased to the extent necessary
to yield to the Administrative Agent or such Lender (after payment of all
Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement, provided,
however, that the Company shall not be required to increase any such amounts
payable to any Lender with respect to any Non-Excluded Taxes (i) that are
attributable to such Lender’s failure to comply with the requirements of
paragraph (d) of this Section or (ii) that are United
States withholding taxes imposed on amounts payable to such Lender at the time
such Lender becomes a party to this Agreement (or at the time such Lender
changes its Lending Office), except to the extent that such Lender’s assignor
(if any) was entitled, at the time of assignment, to receive additional amounts
from the Company with respect to such Non-Excluded Taxes pursuant to this
paragraph.


 


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


 


(c)     Whenever
any Non-Excluded Taxes or Other Taxes are payable by the Company, as promptly
as possible thereafter the Company shall send to the Administrative Agent for
its own account or for the account of the relevant Lender, as the case may be,
a certified copy of an original official receipt received by the Company
showing payment thereof.  If the Company
fails to pay any Non-Excluded Taxes or Other Taxes when due to the appropriate
taxing authority or fails to remit to the Administrative Agent the required
receipts or other required documentary evidence, the Company shall indemnify
the Administrative Agent and the Lenders for any incremental taxes, interest or
penalties that may become payable by the Administrative Agent or any Lender as
a result of any such failure.


 


(d)     Each
Lender (or Transferee) that is not a “U.S. Person” as defined in Section 7701(a)(30)
of the Code (a “Non-U.S. Lender”)
shall deliver to the Company and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN
or Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption
from U.S. federal withholding tax under Section 871(h) or 881(c) of
the Code with respect to payments of “portfolio interest”, a statement
substantially in the form of Exhibit H and
a Form W-8BEN, or any subsequent versions thereof or successors thereto,
properly completed and duly executed by such Non-U.S. Lender claiming complete
exemption from, or a reduced rate of, U.S. federal withholding tax on all
payments by the Company under this Agreement and the other Loan Documents. Such
forms shall be delivered by each Non-U.S. Lender on or before the date it
becomes a party to this Agreement (or, in the case of any Participant, on or
before


 


35

















 


the date such Participant purchases the related
participation).  In addition, each
Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or
invalidity of any form previously delivered by such Non-U.S. Lender.  Each Non-U.S. Lender shall promptly notify
the Company at any time it determines that it is no longer in a position to
provide any previously delivered certificate to the Company (or any other form
of certification adopted by the U.S. taxing authorities for such purpose).  Notwithstanding any other provision of this
paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant
to this paragraph that such Non-U.S. Lender is not legally able to deliver.


 


(e)     [Intentionally
omitted.]


 


(f)      If
the Administrative Agent or any Lender determines, in its sole discretion, that
it has received a refund of any Non-Excluded Taxes or Other Taxes as to which
it has been indemnified by the Company or with respect to which the Company has
paid additional amounts pursuant to this Section 2.10, it shall pay over
such refund to the Company (but only to the extent of indemnity payments made,
or additional amounts paid, by the Company under this Section 2.10 with
respect to the Non-Excluded Taxes or Other Taxes giving rise to such refund),
net of all out-of-pocket expenses of the Administrative Agent or such Lender
and without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund); provided that the Company, upon
the request of the Administrative Agent or such Lender, agrees to repay the
amount paid over to the Company (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to the Administrative Agent or such
Lender in the event the Administrative Agent or such Lender is required to
repay such refund to such Governmental Authority. This paragraph shall not be
construed to require the Administrative Agent or any Lender to make available
its tax returns (or any other information relating to its taxes which it deems
confidential) to the Company or any other Person.


 


(g)     The
agreements in this Section shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.


 


2.11   Indemnity. The
Company agrees to indemnify each Lender and to hold each Lender harmless from
any loss or expense (excluding anticipated profit) which such Lender may
sustain or incur as a consequence of (a) default by the Company in payment
when due of the principal amount of or interest on any Eurodollar Loan, (b) default
by the Company in making a borrowing of Eurodollar Loans after the Company has
given a notice requesting the same in accordance with the provisions of this
Agreement, (c) default by the Company in making any prepayment of any
Eurodollar Loan after the Company has given a notice thereof in accordance with
the provisions of this Agreement or (d) the making of a prepayment of
Eurodollar Loans on a day which is not the last day of an Interest Period with
respect thereto.  Such indemnification
may include an amount equal to the excess, if any, of (i) the amount of
interest which would have accrued on the amount so paid or prepaid, or not so
borrowed, for the period from the date of such prepayment or of such failure to
borrow to the last day of such Interest Period (or, in the case of a failure to
borrow, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Loans
provided for herein (excluding, however, the margin included therein, if any)
over (ii) the amount of interest (as reasonably determined by such Lender)
which would have accrued to such Lender on such amount by placing such amount
on deposit for a comparable period with leading banks in the interbank
eurodollar market. A certificate as to any amounts payable pursuant to this Section 2.11
submitted to the Company by any Lender shall be conclusive in the absence of
manifest error. This covenant shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.


 


2.12   Change of Lending Office.  (a) Each Lender agrees that, upon the
occurrence of any event giving rise to the operation of Section 2.9 or 2.10(a) with
respect to such Lender (“Designating Event”), it will, if requested by the
Company, use reasonable efforts (subject to overall policy


 


36

















 


considerations of such Lender) to designate
another lending office for any Loans affected by such event with the object of
avoiding the consequences of such event; provided that such designation
is made on terms that, in the sole judgment of such Lender, cause such Lender
and its lending office(s) to suffer no economic, legal or regulatory
disadvantage and provided, further,
that nothing in this Section 2.12 shall affect or postpone any of the
obligations of any Company or the rights of any Lender pursuant to Section 2.9
or 2.10(a).


 


(b)     In
connection with any Designating Event, if any Lender does not designate another
lending office for any Loans affected by such Designating Event as described in
paragraph (a) of this Section (such Lender being referred to as a “Non-Designating Lender”), then, so long as
the Lender that is acting as Administrative Agent is not a Non-Designating
Lender, the Company may, at its sole expense and effort, upon notice to such
Non-Designating Lender and the Administrative Agent, require such
Non-Designating Lender to assign and delegate, without recourse (in accordance
with and subject to the restrictions contained in Section 9.6), all its
interests, rights and obligations under this Agreement to an assignee that
shall assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment), provided that (a) the Company shall have
received the prior written consent of the Administrative Agent, which consent
shall not unreasonably be withheld, (b) such Non-Designating Lender shall
have received payment of an amount equal to the outstanding principal of its
Loans, accrued interest thereon, accrued fees and all other amounts payable to
it hereunder from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Company (in the case of all other amounts)
and (c) the Company or such assignee shall have paid to the Administrative
Agent the processing and recordation fee specified in Section 9.6.


 


SECTION 3.   REPRESENTATIONS
AND WARRANTIES


 


To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Loans, the Company hereby represents and warrants to
the Administrative Agent and each Lender (x) as of the Closing Date only
as to the Specified Representations in respect of the Company and its Subsidiaries
(and the Target shall not be deemed a Subsidiary for such purpose) and (y) immediately
following consummation of the Merger and funding of the Initial Loans that:


 


3.1     Financial Condition.  (a) The
audited consolidated financial statements of the Company and the Target for
fiscal year ended December 31, 2004, 2005 and 2006, copies of each of
which have been furnished to each Lender on or before the Closing Date, have
been prepared using accounting methods, procedures and policies which are in
accordance with GAAP and present fairly in all material respects in accordance
with GAAP the financial position of the Company and the Target, respectively,
together with their respective predecessors and respective Subsidiaries on a
consolidated basis, in each case, as at the dates thereof, and the results of
operations and statements of cash flows for the periods then ended.  During the period from December 31, 2006
to and including the date hereof there has been no Asset Disposition by any
Group Member of any material part of its business or property.


 


(b)    The
unaudited consolidated financial statements of the Company and the Target for
fiscal quarter ended March 31, 2007, and unaudited consolidated financial
statements of the Company and the Target for the same period of the prior
fiscal year, copies of each of which have been furnished to each Lender on or
before the Closing Date, have been prepared using accounting methods,
procedures and policies which are in accordance with GAAP and present fairly in
all material respects the financial position of the Company and the Target,
respectively, together with their respective predecessors and respective
Subsidiaries on a consolidated basis, in each case, as at the dates thereof,
and the results of operations and statements of cash flows for the periods then
ended (as to any unaudited interim financial statements, subject to normal
year-end audit adjustments and the absence of footnotes).


 


37

















 


(c)     [Intentionally
omitted].


 


(d)     The
pro forma financial statements of
the Company and its consolidated Subsidiaries attached hereto as Schedule 3.1(d) (collectively,
the “Pro Forma Financial Statements”)
have been prepared in good faith based on assumption believed to be reasonable as
of the date of delivery thereof, and present fairly in all material respects in
accordance with GAAP on a pro forma basis
the estimated financial position of Company and its consolidated Subsidiaries
with respect to the relevant period and as at the relevant date, assuming that
the events specified therein had actually occurred at such date.


 


3.2     No Change.  Since December 31,
2006 there has been no development or event which has had or could reasonably
be expected to have a Material Adverse Effect.


 


3.3     Corporate Existence; Compliance with Law.  Holdings, IntermediateCo, the Company and each
of their respective Subsidiaries (a) is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization, (b) has
the power and authority, and the legal right, to own and operate its property,
to lease the property it operates as lessee and to conduct the business in
which it is currently engaged, (c) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification and (d) is in compliance with all Requirements
of Law except to the extent that the failure to comply therewith could not, in
the aggregate, reasonably be expected to have a Material Adverse Effect.


 


3.4     Corporate Power; Authorization; Enforceable Obligations.  (a) Each Loan Party has the power and
authority, and the legal right, to make, deliver and perform this Agreement,
any of the Notes and the other Loan Documents to which it is a party and, with
respect to the Company, to borrow hereunder. 
Each Loan Party has taken all necessary action to authorize the
execution, delivery and performance of the Loan Documents to which it is a
party and, with respect to the Company, to authorize the borrowings on the
terms and conditions of this Agreement and any of the Notes and the other Loan
Documents. No consent or authorization of, filing with, notice to or other act
by or in respect of, any Governmental Authority or any other Person is required
in connection with the borrowings hereunder or with the execution, delivery,
performance, validity or enforceability of, this Agreement, any of the Notes or
the other Loan Documents to which any Loan Party is a party except for (i) filings
necessary to perfect or maintain the perfection of the Liens on the Collateral
granted by the Loan Parties, (ii) the approvals, consents, exemptions,
authorizations, actions, notices and filings which have been duly obtained,
taken, given or made and are in full force and effect and (iii) those
approvals, consents, exemptions, authorizations or other actions, notices or
filings, the failure of which to obtain or make could not reasonably be
expected to have a Material Adverse Effect. 
This Agreement, any Note and each of the other Loan Documents has been
duly executed and delivered on behalf of the Loan Party thereto.  This Agreement, any Note and each of the
other Loan Documents constitutes a legal, valid and binding obligation of the
Loan Party thereto enforceable against such Loan Party in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).


 


(b)     The
Warrants have been duly authorized by the Company and, when executed and
authenticated pursuant to the terms of the Warrant Agreement and delivered to
the Escrow Agent, will be valid and binding obligations of the Company,
enforceable against it in accordance with its terms, except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
and similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law). The Warrant
Shares have


 


38

















 


been duly authorized and validly issued, and upon
exercise of the Warrants in accordance with the terms of the Warrant Agreement
will be fully paid and nonassessable.


 


3.5     No Legal Bar.  The
execution, delivery and performance of this Agreement, any of the Notes and the
other Loan Documents, the borrowings hereunder and thereunder and the use of
the proceeds thereof will not violate any Requirement of Law or any Contractual
Obligation of any Group Member and will not result in, or require, the creation
or imposition of any Lien on any of their respective properties or revenues
pursuant to any Requirement of Law or any such Contractual Obligation (other
than the Liens created by the Security Documents); except with respect to any
violation, to the extent that such violation could not reasonably be expected
to have a Material Adverse Effect.


 


3.6     No Material Litigation.  No litigation, investigation or proceeding of
or before any arbitrator or Governmental Authority is pending or, to the knowledge
of the Company, threatened by or against any Group Member or against any of
their respective properties or revenues (a) with respect to this
Agreement, the other Loan Documents, any of the Transaction Documents or the
Transactions contemplated hereby or thereby, or (b) which could reasonably
be expected to have a Material Adverse Effect.


 


3.7     No Default.  No Group
Member is in default under or with respect to any of its Contractual
Obligations (other than Indebtedness) in any respect which could reasonably be
expected to have a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.


 


3.8     Ownership of Property; Liens.  Each Group Member has good and valid title in
fee simple to, or a valid leasehold interest in, all its material real
property, and good title to, or a valid leasehold interest in, all its other
material property, and none of such property is subject to any Lien except as
permitted by Section 6.5.


 


3.9     Intellectual Property.  Each Group
Member owns, or is licensed to use, all Intellectual Property material to the
conduct of the business of the Company and its Subsidiaries, taken as a whole,
as currently conducted. No claim has been asserted and is pending by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does the
Company know of any valid basis for any such claim, other than claims that
could not reasonably be expected to have a Material Adverse Effect. The use of
such Intellectual Property by each Group Member does not infringe on the rights
of any Person, except as could not reasonably be expected to have an Material
Adverse Effect.


 


3.10   Taxes. Each
Group Member has filed or caused to be filed all Federal, material state and
all other material tax returns which are required to be filed and has paid all
taxes shown to be due and payable on said returns or on any assessments made
against it or any of its property and all other taxes, fees or other charges
imposed on it or any of its property by any Governmental Authority (other than
any such taxes, assessments, fees or other charges the amount or validity of
which are currently being contested in good faith by appropriate proceedings
and with respect to which reserves in conformity with GAAP have been provided
on the books of the relevant Group Member); no tax Lien has been filed, and, to
the knowledge of the Loan Parties, no claim is being asserted, with respect to
any such tax, fee or other charge.


 


3.11   Federal Regulations.  No part of
the proceeds of any Loans will be used for any purpose which violates the
provisions of the Regulations of the Board of Governors. If reasonably
requested by any Lender or the Administrative Agent, the Company will furnish
to the Administrative Agent and each Lender a statement to the foregoing effect
in conformity with the requirements of FR Form G-3 or FR Form U-1, as
applicable, referred to in said Regulation U.


 


39

















 


3.12   Labor Matters.  There are no
strikes or other labor disputes against Holdings, the Company or any of its
Subsidiaries pending or, to the knowledge of the Company, threatened that
(individually or in the aggregate) could reasonably be expected to have a
Material Adverse Effect. Hours worked by and payment made to employees of the
Company and its Subsidiaries have not been in violation of the Fair Labor
Standards Act or any other applicable Requirement of Law dealing with such
matters that (individually or in the aggregate) could reasonably be expected to
have a Material Adverse Effect. All payments due from the Company or any of its
Subsidiaries on account of employee health and welfare insurance that
(individually or in the aggregate) could reasonably be expected to have a
Material Adverse Effect if not paid have been paid or accrued as a liability on
the books of the Company or the relevant Subsidiary.


 


3.13   ERISA.  Neither a Reportable Event nor an “accumulated
funding deficiency” (within the meaning of Section 412 of the Code or Section 302
of ERISA) has occurred during the five-year period prior to the date on which
this representation is made or deemed made with respect to any Single Employer
Plan, and each Single Employer Plan has complied in all material respects with
the applicable provisions of ERISA and the Code. No termination of a Single
Employer Plan has occurred, and no Lien in favor of the PBGC or a Plan has
arisen with respect to any Single Employer Plan, during such five-year period.  The present value of all accrued benefits
under each Single Employer Plan (based on those assumptions used to fund such
Single Employer Plans) did not, as of the last annual valuation date prior to
the date on which this representation is made or deemed made, exceed the value
of the assets of such Single Employer Plan allocable to such accrued benefits
by a material amount.  Neither the
Company nor any Commonly Controlled Entity has had a complete or partial
withdrawal from any Multiemployer Plan which has resulted or could reasonably
be expected to result in a material liability under ERISA.  No such Multiemployer Plan is in
Reorganization or Insolvent.


 


3.14   Investment Company Act; Other Regulations.  No Loan Party is required to register as an “investment company”, within the meaning of
the Investment Company Act of 1940, as amended.


 


3.15   Subsidiaries.  As of the Closing Date, (a) Schedule 3.15
sets forth the name and jurisdiction of incorporation of each Subsidiary and,
as to each such Subsidiary, the percentage of each class of Capital Stock owned
by any Loan Party and (b) except as set forth on Schedule 3.15, there are
no outstanding subscriptions, options, warrants, calls, rights or other
agreements or commitments (other than stock options granted to employees,
directors or consultants and directors’ qualifying shares) of any nature
relating to any Capital Stock of the Company or any Subsidiary, except as
created by the Loan Documents.


 


3.16   Purpose of Loans.  The proceeds
of the Loans shall be used to (i) finance a portion of the Merger, (ii) repay
the Existing Credit Facilities and (iii) pay certain transactions costs,
fees and expenses related to the Transactions and the financing thereof.


 


3.17   Environmental Matters.  (a) The
facilities and properties owned, leased or operated by any Group Member (the “Properties”) do not contain, and have not
previously contained, any Materials of Environmental Concern in amounts or
concentrations or under circumstances which (i) constitute or constituted
a violation of, or (ii) could give rise to liability under, any
Environmental Law, except in either case insofar as such violations or
liabilities, could not, in the aggregate, be expected to have a Material
Adverse Effect.


 


(b)     The
Properties and all operations at the Properties are in compliance, and have in
the last five years been in compliance, with all applicable Environmental Laws,
and there is no contamination at, under or about the Properties or violation of
any Environmental Law with respect to the Properties or the business operated
by the Company or any of its Subsidiaries (the “Business”), which could interfere


 


40

















 


with the continued operation of the Properties or impair the
fair saleable value thereof, except in either case insofar as such
interferences or impairments, could not, in the aggregate, be expected to have
a Material Adverse Effect.


 


(c)     No
Group Member has received or is aware of any notice of violation, alleged
violation, non-compliance, liability or potential liability under Environmental
Laws with regard to any of the Properties or the Business, nor does the Company
have knowledge or reason to believe that any such notice will be received or is
being threatened, except insofar as such notices or threatened notices, could
not, in the aggregate, be expected to have a Material Adverse Effect.


 


(d)     Materials
of Environmental Concern have not been transported or disposed of from the
Properties in violation of, or in a manner or to a location which could give
rise to liability under, any Environmental Law, nor have any Materials of
Environmental Concern been generated, treated, stored or disposed of at, on or
under any of the Properties in violation of, or in a manner that could give
rise to liability under, any applicable Environmental Law, except insofar as
any such violations or liabilities referred to in this paragraph, could not, in
the aggregate, be expected to have a Material Adverse Effect.


 


(e)     No
judicial proceeding or governmental or administrative action is pending or, to
the knowledge of the Company, threatened, under any Environmental Law to which
any Group Member is or will be named as a party with respect to the Properties
or the Business, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with respect to
the Properties or the Business, except insofar as such proceedings, actions,
decrees, orders or other requirements, could not, in the aggregate, be expected
to have a Material Adverse Effect.


 


(f)      There
has been no release or threat of release of Materials of Environmental Concern
at or from the Properties, or arising from or related to the operations of any
Group Member in connection with the Properties or otherwise in connection with
the Business, in violation of or in amounts or in a manner that could give rise
to liability under Environmental Laws, except insofar as any such violations or
liabilities referred to in this paragraph, could not, in the aggregate, be
expected to have a Material Adverse Effect.


 


3.18   Solvency.  Holdings and its consolidated subsidiaries,
taken as a whole, are, and immediately after giving effect to the Transactions
(other than the issuance of Take-Out Debt) and the incurrence of all
Indebtedness and obligations being incurred in connection herewith and
therewith will be Solvent.


 


3.19   Accuracy of Information, etc.  No document, certificate or statement
furnished to the Administrative Agent or the Lenders or any of them, by or on
behalf of any Loan Party for use in connection with the transactions
contemplated by this Agreement or the other Loan Documents, taken as a whole
and as modified or supplemented by other information so furnished prior to the
Closing Date, contained as of the date such statement, document or certificate
was so furnished, any untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements contained herein or
therein not misleading; provided that with respect to projections and pro forma financial information contained
in the materials referenced above the Company represents only that such
projections and pro forma financial
information was based upon good-faith estimates and assumptions believed by
management of the Company to be reasonable at the time made, it being
recognized by the Lenders that such financial information as it relates to
future events is not to be viewed as fact and that actual results during the period
or periods covered by such financial information may differ from the projected
results set forth therein by a material amount. As of the date hereof, to the
knowledge of the


 


41

















 


Company,
the representations and warranties contained in the Merger Documents are true
and correct in all material respects.


 


3.20   Delivery of the Transaction Documents.  The Administrative Agent has received for
itself and for each Lender a complete photocopy of the Merger Documents
(including all exhibits, schedules and disclosure letters referred to therein
or delivered pursuant thereto, if any) and all amendments thereto, waivers
relating thereto and other side letters or agreements affecting the terms
thereof in any material respect.


 


3.21   Security Documents.  (a)   The Guarantee and Collateral Agreement is
effective to create in favor of the Administrative Agent, for the benefit of
the Secured Parties, a legal, valid and enforceable security interest in the
Collateral described therein and proceeds thereof enforceable against the Loan
Parties in accordance with its terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors’ rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law). In the case of the Pledged Stock described in the Guarantee and
Collateral Agreement, when stock certificates representing such Pledged Stock
are delivered to the Administrative Agent, and in the case of the other
Collateral described in the Guarantee and Collateral Agreement, when financing
statements and other filings specified on Schedule 3.21(a) in appropriate
form are filed in the offices specified on Schedule 3.21(a), the Guarantee and
Collateral Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the Loan Parties in such
Collateral and the proceeds thereof, as security for their respective
Obligations (as defined in the Guarantee and Collateral Agreement) to the
extent a Lien on such Collateral can be perfected by the filing of a financing
statement, by filings to be made with the FAA, by filings to be made in respect
of Intellectual Property in the United States Patent and Trademark Office and
the United States Copyright Office or, in the case of the Pledged Stock, by
possession or control, in each case prior and superior in right to any other
Person (except (x) in the case of Collateral constituting Pledged Stock,
nonconsensual Liens permitted by Section 6.5 and (y) in the case of
Collateral other than Pledged Stock, Liens permitted by Section 6.5).


 


(b)     Each of
the Mortgages is effective to create in favor of the Administrative Agent, for
the benefit of the Lenders enforceable against the Loan Parties in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
the enforcement of creditors’ rights generally and by general equitable
principles (whether enforcement is sought by proceedings in equity or at law),
a legal, valid and enforceable Lien on the Mortgaged Properties described
therein and proceeds thereof to the extent provided therein, and when the
Mortgages are filed in the offices specified on Schedule 3.21(b), each such
Mortgage shall constitute a fully perfected Lien on, and security interest in,
all right, title and interest of the Loan Parties in the Mortgaged Properties
and the proceeds thereof to the extent provided therein, as security for their
respective Obligations (as defined in the relevant Mortgage), in each case
prior and superior in right to any other Person (except that the security
interest created in such real property and the Mortgaged Property may be
subject to the Liens permitted by Section 6.5). Schedule 1.1B lists, as of
the Closing Date, each parcel of owned real property located in the United
States and held by the Company or any of its Subsidiaries that has a value, in
the reasonable opinion of the Company, in excess of $2,500,000.


 


3.22  Section 1110.  The
aircraft, engines and spare engines listed on Schedule 1.1C represent each of
the Mortgaged Aircraft, engines and spare engines as of the Closing Date that
were first placed in service prior to October 22, 1994.


 


42

















 


SECTION 4.   CONDITIONS
PRECEDENT


 


The agreement of each Lender to make the
Initial Loan requested to be made by it is subject to the satisfaction on or
prior to the Closing Date of the following conditions precedent:


 


(a)     Loan
Documents.  The Administrative
Agent shall have received (i) this Agreement, executed and delivered by a
duly authorized officer of the Company with a counterpart for each Lender, (ii) for
the account of each Lender requesting the same at least two Business Days prior
to the Closing Date, a Loan Note conforming to the requirements hereof and
executed by a duly authorized officer of the Company, (iii) the Warrant
Agreement (including the registration rights agreement attached thereto)
executed and delivered by a duly authorized officer of the Company and Holdings
shall have executed and delivered to the Administrative Agent Warrants
representing 8.5% of Holdings’ outstanding common equity on a fully diluted
basis (other than with respect to options to be issued pursuant to the New ATA
Holdings Inc. 2006 Long Term Incentive Plan), (iv) the Guarantee and
Collateral Agreement to be entered into on the Closing Date, executed and
delivered by a duly authorized officer of Holdings, IntermediateCo, the Company
and the Subsidiary Guarantors and (v) an Acknowledgement and Consent in
the form attached to the Guarantee and Collateral Agreement, executed and
delivered by each Issuer (as defined therein), if any, that is not a Loan
Party.


 


(b)     Transactions, etc.  The following transactions shall
have been consummated:


 


(i)     the acquisition of the Target by Affiliates
of the Sponsor (the “Merger”)
shall have been consummated in accordance with the Merger Documents, without
giving effect to any waiver, amendment, supplement or other modification of any
term or condition thereunder in any respect that is materially adverse to
Holdings, the Company or the Lenders;


 


(ii)    Holdings shall have received at least
$50,000,000 from the proceeds of equity issued by Holdings to funds managed by
the Sponsor and other investors, and such proceeds shall have been contributed
to the Company;


 


(iii)   Holdings shall have received at least
$161,100,000 from the proceeds of Series A Preferred Stock issued by
Holdings to funds managed by the Sponsor, and such proceeds shall have been
directly or indirectly contributed to the Company to be used by the Company to (i) repay
or otherwise satisfy certain Indebtedness owed by Holdings to certain
Affiliates of the Sponsor and (ii) partially finance the cash requirements
of the Merger; and


 


(iv)   (A) The Administrative Agent shall have
received reasonably satisfactory evidence that (1) the Existing Credit
Facilities (other than any letter of credit facility under the Wachovia
Facility which shall be secured only by the deposits described in clause (xxiv)
of the definition of Permitted Liens) shall have been terminated and all
amounts thereunder shall have been paid in full and any outstanding letters of
credit thereunder cash-collateralized and (2) the MP Bridge Loan Agreement
and the MP Term Loan Agreement shall have been terminated and all amounts
thereunder shall have been paid in full or otherwise satisfied and (B) arrangements
reasonably satisfactory to the Administrative Agent shall have been made for
the termination of all Liens granted in connection with the credit facilities
described in clause (A) (other than Liens described in clause (xxiv) of
the definition of Permitted Liens).


 


43

















 


(c)     Payment
of Fees.  All fees and
invoiced expenses required to be paid on or before the Closing Date to the
Administrative Agent and the Lenders shall have been paid or provision for
payment thereof shall have been made.


 


(d)     Historical
Financial Statements.  The
Lenders shall have received the financial statements referred to in Section 3.1
and all other financial statements for completed or pending acquisitions by any
Group Member that may be required under Regulation S-X of the Securities Act.


 


(e)     Solvency.
 The Lenders shall have
received a customary solvency certificate executed on behalf of Holdings by the
chief financial officer of Holdings certifying that Holdings and its subsidiaries,
taken as a whole, and immediately after giving effect to the Transactions
(other than the issuance of Take-Out Debt), including the incurrence of all
Indebtedness and obligations being incurred in connection herewith and
therewith will be Solvent, in form reasonably satisfactory to the
Administrative Agent.


 


(f)      [Intentionally omitted].


 


(g)     Legal
Opinions.  The Administrative
Agent shall have received the following legal opinions: (i) opinions from
Cravath, Swaine & Moore LLP, special New York counsel to Holdings,
substantially in the form of Exhibit F-1, (ii) opinions from Delaware
counsel to Holdings and the Company, substantially in the form of Exhibit F-2,
(iii) draft opinions from FAA counsel to Holdings and the Company,
substantially in the form of Exhibit F-3, and.(iv) opinions from
general counsel of ATA, substantially in the form of Exhibit F-4, (v) opinions
from general counsel of Target, substantially in the form of Exhibit F-5,
and (vi) if agreed by opining counsel, opinions delivered pursuant to the
Merger Agreement, accompanied by reliance letters in favor of the Lenders.


 


(h)    Closing
Certificate.  The
Administrative Agent shall have received a certificate of the Company, dated
the Closing Date, substantially in the form of Exhibit C.


 


(i)      Corporate
Proceedings of the Loan Parties.  The
Administrative Agent shall have received a copy of the resolutions of the board
of directors of each Loan Party authorizing, as applicable, (i) the
execution, delivery, and performance of this Agreement and the other Loan
Documents and the Transaction Documents to which it is or will be a party as of
the Closing Date, and (ii) in the case of the Company, the Loans to the
Company, certified by the Secretary or an Assistant Secretary of such Loan
Party as of the Closing Date, which certificate shall be in form and substance
reasonably satisfactory to the Administrative Agent and shall state that the
resolutions thereby certified have not been amended, modified (except as any
later such resolution may modify any earlier such resolution), revoked or
rescinded and are in full force and effect.


 


(j)      Incumbency
Certificates of the Loan Parties.  The
Administrative Agent shall have received a certificate of each Loan Party,
dated the Closing Date, as to the incumbency and signature of the officers of
such Loan Party executing any Loan Document, reasonably satisfactory in form
and substance to the Administrative Agent, executed by a Responsible Officer
and the Secretary or any Assistant Secretary of such Loan Party.


 


(k)     Governing
Documents.  The
Administrative Agent shall have received copies of the certificate or articles
of incorporation and by-laws (or other similar governing documents serving


 


44

















 


the same purpose) of each Loan Party, certified as of
the Closing Date as complete and correct copies thereof by the Secretary or an
Assistant Secretary of such Loan Party.


 


(l)      Representations
and Warranties.  Each of the
representations and warranties made in the Merger Agreement by or on behalf of
the Target as are material to the interests of the Lenders (but only to the
extent Holdings and the Company have a right to terminate their obligations
under the Merger Agreement as a result of a breach of any such representation
or warranty) and the Specified Representations shall be true and correct in all
material respects on and as of the date of the borrowing of the Initial Loans
as if made on and as of such date (unless stated to relate to a specific
earlier date, in which case, such representations and warranties shall be true
and correct in all material respects as of such earlier date).


 


(m)    [Intentionally omitted].


 


(n)     Lien
Searches; Perfection.  The
following shall have been satisfied:


 


(i)     the Administrative Agent shall have
received UCC searches conducted in the jurisdictions in which the Company and
the Guarantors are incorporated or such other jurisdictions as the
Administrative Agent may reasonably require and Lien searches conducted in the
recording office of the FAA and, with respect to the applicable Mortgaged
Aircraft, “priority search certificates” (as defined in the Regulations and
Procedures for the International Registry), all as may be reasonably
satisfactory to the Administrative Agent (dated as of a date reasonably
satisfactory to the Administrative Agent), reflecting the absence of Liens and
encumbrances on the assets of the Company and the Guarantors except for Liens
permitted by Section 6.5, Liens to be discharged on or prior to the
Closing Date pursuant to documentation reasonably satisfactory to the
Administrative Agent and Liens as to which arrangements for discharge
reasonably satisfactory to the Administrative Agent shall have been made and
the absence of registrations on the International Registry with respect to the
applicable Mortgaged Aircraft other than the registrations contemplated herein,
and (in the case of the searches conducted at the recording office of the FAA)
indicating that the Company (or a Guarantor) is the registered owner of each of
the aircraft which is intended to be covered by the Aircraft Mortgages;


 


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


 


(iii)   each
document (including any Uniform Commercial Code financing statement) required
by the Security Documents or under law or reasonably requested by the
Administrative Agent to be filed, registered or recorded in order to create in
favor of the Administrative Agent, for the benefit of the Lenders, a perfected
Lien on the Collateral described therein, prior and superior in right to any other
Person (other than with respect to Liens expressly permitted by Section 6.5),
shall be in proper form for filing, registration or recordation,


 


45

















 


provided
that, notwithstanding anything in this clause (n) to the contrary, but
without prejudice to the requirement set forth in Section 5.13 after the
Closing Date, with respect to any Collateral the security interest in which may
not be perfected by filing of a UCC financing statement or delivery of stock certificates,
if the perfection of the Administrative Agent’s security interest in such
collateral has not been accomplished prior to the Closing Date, then delivery
of documents and instruments for perfection of such security interest shall not
constitute a condition precedent to the availability of the Initial Loans.


 


(o)    Mortgages,
etc.  (i) The
Administrative Agent shall have received a Mortgage with respect to each
Mortgaged Aircraft, including a Mortgage Supplement with respect to each
Aircraft Mortgage, executed and delivered by a duly authorized officer of each
party thereto.


 


(ii) With respect to Mortgaged Aircraft, the
Administrative Agent shall have received (i) evidence of the filing for
recordation with the FAA of each Aircraft Mortgage and Mortgage Supplement
(together with any other necessary documents, instruments, affidavits or
certificates) as the Administrative Agent may deem reasonably necessary to
perfect and protect the Liens created thereby, including, without limitation,
recordings and filings with the FAA, and all filings and recording fees and
taxes in respect thereof shall have been duly paid, (ii) copies of the
Entry Point Filing Forms, and (iii) evidence that all other action that
the Administrative Agent may deem reasonably necessary to perfect and protect
the Liens and security interests created under each Aircraft Mortgage and
Mortgage Supplement has been taken.


 


Notwithstanding anything in this clause (o) to
the contrary, but without prejudice to the requirement set forth in Section 5.13
after the Closing Date, with respect to any Collateral the security interest in
which may not be perfected by filing of a UCC financing statement or delivery
of stock certificates, if the perfection of the Administrative Agent’s security
interest in such collateral has not been accomplished prior to the Closing
Date, then delivery of documents and instruments for perfection of such
security interest (including all documents described in clause (ii) above)
shall not constitute a condition precedent to the availability of the Initial
Loans.


 


(p)    Rating. The
Initial Loans shall have received an implied rating from both Moody’s Investors
Service, Inc. and Standard & Poor’s Ratings Group.


 


The
making of the Initial Loans by the Lenders hereunder shall conclusively be
deemed to constitute an acknowledgement by the Administrative Agent and each
Lender that each of the conditions precedent set forth in this Section 4
shall have been satisfied in accordance with its respective terms or shall have
been irrevocably waived by such Person.


 


Notwithstanding anything in the Agreement or any other Loan Document to
the contrary, (i) the only representations and warranties (and related
defaults) relating to Target, its subsidiaries and their businesses the making
of which shall be a condition to availability of the Initial Loans on the
Closing Date shall be such of the representations made by Target in the Merger
Agreement as are material to the interests of the Lenders, but only to the
extent that the Company has the right to terminate its obligations under the
Merger Agreement as a result of a breach of such representations in the Merger
Agreement, and (ii) the only other representations and warranties (and
related defaults) made by the Loan Parties the making of which shall be a
condition to availability of the Initial Loans on the Closing Date shall be the
Specified Representations.


 


46

















 


SECTION 5.  AFFIRMATIVE
COVENANTS


 


Except as modified on the Initial Maturity
Date as set forth in Section 9.1, the Company hereby agrees that, so long
as the Commitments remain in effect, any Loan or Loan Note remains outstanding
and unpaid, or any other amount is due and owing to any Lender or the
Administrative Agent hereunder or under any of the other Loan Documents, the
Company shall, and, in the case of the agreements contained in Sections 5.3
through 5.6, 5.8, 5.11 and 5.12, shall cause each of its Subsidiaries to:


 


5.1     Financial Statements.  Furnish to the Administrative Agent and each
Lender:


 


(a)     as soon as available, but in any event
within 90 days after the end of each fiscal year of Holdings, a copy of the
audited consolidated balance sheet of Holdings and its consolidated
Subsidiaries as at the end of such year and the audited consolidated statements
of income and of cash flows for such year, setting forth in each case in
comparative form the figures for the previous year, reported on without a “going concern” or like qualification or
exception, or qualification arising out of the scope of the audit, by Ernst &
Young LLP or other independent certified public accountants of nationally
recognized standing;


 


(b)     as soon as available, but in any event not
later than (i) September 15, 2007 for the quarterly period ended June 30,
2007, (ii) November 15, 2007 for the quarterly period ending September 30,
2007 and (iii) 45 days after the end of each of the first three quarterly
periods of each fiscal year of Holdings, beginning with the fiscal quarter
ended March 31, 2008, the unaudited, consolidated balance sheet of
Holdings and its consolidated Subsidiaries as at the end of such quarter and
the related unaudited consolidated statements of income and of cash flows of
Holdings and its consolidated Subsidiaries for such quarter and the portion of
the fiscal year through the end of such quarter, setting forth in each case in
comparative form the figures for the previous year, certified by a Responsible
Officer as being fairly stated in all material respects in accordance with GAAP
(subject to normal year-end audit adjustments and the absence of notes); and


 


(c)     as soon as available, but in any event not
later than 45 days after the end of each month (other than a month the last day
of which coincides with the last day of any fiscal quarter) of each fiscal year
of the Company, copies of the internal management reports of the Company for
such month and the portion of the fiscal year through the end of such month,
setting forth in each case in comparative form (i) the corresponding
figures for the Company for the previous year and (ii) the corresponding
figures set forth in the relevant budgets required to be delivered in
accordance with Section 5.2(b);


 


all such financial statements shall fairly
present in all material respects in accordance with GAAP subject in the case of
unaudited statements to normal year-end audit adjustments and the absence of
notes) the consolidated financial position of Holdings and its Subsidiaries as
of such date and shall be prepared in reasonable detail and in accordance with
GAAP applied consistently throughout the periods reflected therein and with prior periods (except
as approved by such accountants or officer, as the case may be, and disclosed
therein).


 


5.2     Certificates; Other
Information.  Furnish to the
Administrative Agent for delivery to each Lender (or, in the case of clause
(e), to the relevant Lender):


 


(a)     concurrently with the delivery of the
financial statements referred to in Section 5.1(a), a certificate of the
independent certified public accountants reporting on such


 


47

















 


financial statements stating that in making the
examination necessary therefor no knowledge was obtained of any Default or
Event of Default, except as specified in such certificate (which certificate
may be limited to the extent required by such firm’s general accounting and
auditing rules, policies or guidelines);


 


(b)     concurrently with the delivery of the
financial statements referred to in Sections 5.1(a) and 5.1(b), a
certificate of a Responsible Officer (i) stating that such Responsible
Officer has obtained no knowledge of any Default or Event of Default existing
at the date of such certificate except as specified in such certificate, (ii) stating
that all such financial statements fairly present in all material respects in
accordance with GAAP the consolidated financial position of Holdings its
Subsidiaries as at the date thereof and the results of operations and cash
flows for the period then ended (subject, in the case of interim statements, to
normal year-end audit adjustment and the absence of notes) and have been
prepared in accordance with GAAP applied consistently throughout the periods
reflected therein (except as disclosed therein), and (iii) to the extent
not previously disclosed to the Administrative Agent, (1) a description of
any change in the jurisdiction of organization of any Loan Party, (2) a
list of any registered Intellectual Property acquired by any Loan Party and (3) a
description of any Person that has become a Group Member, in each case since
the date of the most recent report delivered pursuant to this clause (iii) (or,
in the case of the first such report so delivered, since the Closing Date);


 


(c)     as soon as available, and in any event no
later than 45 days after the end of each fiscal year of Holdings, the
consolidated budget for the following fiscal year used internally by Holdings;


 


(d)     unless available pursuant to public
filings, concurrently with the delivery of the financial statements referred to
in Sections 5.1(a) and 5.1(b), a narrative discussion and analysis of the
financial condition and results of operations of the Company and its
Subsidiaries for such fiscal quarter and for the period from the beginning of
the then current fiscal year to the end of such fiscal quarter, as compared to
the portion of the Projections covering such periods and to the comparable
periods of the previous year;


 


(e)     within five days after the same are filed,
copies of all periodic reports which the Company may make to, or file with, the
Securities and Exchange Commission or any successor or analogous Governmental
Authority; and


 


(f)      promptly, such additional financial and
other information as any Lender may from time to time reasonably request.


 


5.3     Payment of Obligations.  Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature (excluding Indebtedness), except where (i) the
amount or validity thereof is currently being contested in good faith by
appropriate proceedings and reserves to the extent required by GAAP with
respect thereto have been provided on the books of the relevant Group Member or
(ii) the failure to pay or discharge the same could not reasonably be
expected to have a Material Adverse Effect.


 


5.4     Maintenance of Existence; Compliance.  (a)(i) Preserve, renew and keep in full
force and effect its organizational existence except, in the case of any
Subsidiary of the Company, where the failure to perform such obligations,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect and (ii) take all reasonable action to maintain
all rights, privileges and franchises necessary or desirable in the normal
conduct of its business, except, in each case, as otherwise permitted by Section 6.9
and except, in the case of clause (ii) above, to the extent that failure
to do so


 


48

















 


could not reasonably be expected to have a Material
Adverse Effect; and (b) comply with all Contractual Obligations (excluding
Indebtedness) and Requirements of Law except to the extent that failure to
comply therewith could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.


 


5.5     Maintenance of Property;
Insurance.  (a) Except if
failure to do so could not reasonably be expected to have a Material Adverse
Effect, keep all property material to the operation of its business in good
working order and condition, ordinary wear and tear excepted.


 


(b) (i) Maintain with financially
sound and reputable insurance companies insurance on all its property in at
least such amounts and against at least such risks (but including in any event
public liability, product liability and business interruption) as are usually
insured against in the same general area by companies engaged in the same or a
similar business (in each case, after giving effect to any self-insurance
reasonable and customary for similarly situated Persons engaged in the same or
similar businesses as the Company and its Subsidiaries).


 


(ii) Promptly deliver to the Administrative Agent copies of any
notices received from its insurers with respect to insurance programs required
by the Terrorism Risk Insurance Act of 2002 (as extended by the Terrorism Risk
Insurance Extension Act of 2005) and, if so requested by the Administrative
Agent, procure and maintain in force the insurance that is offered in such
programs to the same extent maintained by companies of the same or similar size
in the same or similar businesses.


 


5.6     Inspection of Property; Books and Records;
Discussions.  (a) Keep
proper books of records and account in conformity in all material respects with
GAAP; and (b) permit representatives of the Administrative Agent (who may
be accompanied by representatives of the Lenders) (or during the continuance of
an Event of Default, any Lender) to visit and inspect any of its properties and
examine and make abstracts from any of its books and records upon reasonable
advance notice at any reasonable time on any Business Day and as often as may
reasonably be desired and to discuss the business, operations, properties and
financial and other condition of the Group Members with officers and employees
of the Group Members and with its independent certified public accountants in
all cases subject to applicable law and the terms of any applicable
confidentiality agreements not entered into for purposes of obstructing the
operation of this Section 5.6.  The
Administrative Agent and the Lenders shall give the Company the opportunity to
participate in any discussions with the Company’s independent public
accountants.


 


5.7     Notices.  Promptly (but in any event within five
Business Days) after any Responsible Officer of the Company obtains knowledge
thereof, give notice to the Administrative Agent of:


 


(a)     the occurrence of any
continuing Default or Event of Default;


 


(b)     any (i) default or event of default
under any Contractual Obligation of any Group Member or (ii) litigation,
investigation or proceeding which may exist at any time between any Group
Member and any Governmental Authority, which in either case, could reasonably
be expected to have a Material Adverse Effect;


 


(c)     any litigation or proceeding affecting any
Group Member which relates to any Loan Document;


 


(d)     the following events, if, individually or
in the aggregate, the liability that could reasonably be expected to result
would be material to the Company and its Subsidiaries, taken as


 


49

















 


a whole: (i) the occurrence or expected
occurrence of any Reportable Event with respect to any Single Employer Plan, a
failure to make any required contribution to a Plan, the creation of any Lien
in favor of the PBGC or a Single Employer Plan or any withdrawal from, or the
termination, Reorganization or Insolvency of, any Multiemployer Plan or (ii) the
institution of proceedings or the taking of any other action by the PBGC or the
Company or any Commonly Controlled Entity or any Multiemployer Plan with respect
to the withdrawal from, or the termination, Reorganization or Insolvency of,
any Single Employer Plan or Multiemployer Plan; and


 


(e)     the receipt by any Group Member of any
complaint, order, citation, notice or other written communication from any
Person with respect to the existence or alleged existence of a violation of any
Environmental Laws or Materials of Environmental Concern or any other
environmental, health or safety matter including the occurrence of any spill,
discharge or release in a quantity that is reportable under any Environmental
Law on any of the Properties but only to the extent that such complaint, order,
citation, notice or written communication individually or in the aggregate
could reasonably be expected to result in a Material Adverse Effect.


 


Each notice pursuant to this Section shall be
accompanied by a statement of a Responsible Officer setting forth details of
the occurrence referred to therein and stating what action the relevant Group
Member proposes to take with respect thereto.


 


5.8     Environmental Laws.  (a) Comply in all material respects with,
and use reasonable best efforts to cause all tenants and subtenants, if any, in
all material respects to comply with, all applicable Environmental Laws; and


 


(b)     Conduct and complete (or cause to be conducted and completed)
all investigations, studies, sampling and testing, and all remedial, removal
and other actions required under Environmental Laws and in a timely fashion
comply in all material respects with all lawful orders and directives of all
Governmental Authorities regarding Environmental Laws except in each such case
to the extent that the same are being contested in good faith by appropriate
proceedings and the pendency of such proceedings could not be reasonably
expected to have a Material Adverse Effect.


 


5.9     Take-Out Financing.
 (a) Take any action reasonably
necessary or desirable so that the Investment Bank can, during the period
referred to below, publicly sell or privately place, in one or more offerings
or placements, the Take-Out Debt (so long as the Company is legally permitted
to do so).  Subject to the other
provisions of this Agreement, the Investment Bank, in its reasonable discretion
after consultation with the Company, shall determine whether, and in which
amounts, the Take-Out Debt shall be issued by the Company and/or Holdings and
the amount of each series of Take-Out Debt to be issued if the Take-Out Debt is
to be issued in a series of offerings and/or placements and the types or
combinations of Take-Out Debt to be issued. 
Upon notice by the Investment Bank (a “Securities
Demand”), at any time and from time to time (x) after a
reasonable marketing period (including a road show) but, unless the Take-Out
Debt is to be issued on the Closing Date, no earlier than the 180th day
following the Closing Date and (y) prior to the Initial Maturity Date
(which notice may be given not more than twice) that, in its reasonable
opinion, market conditions are such that the conditions specified in clauses (i) and
(ii) of the following proviso can be satisfied, if all Loans shall not
have been repaid in full or the commitments in respect thereof shall not have
been terminated, the Company and Holdings will cause the issuance and sale of
Take-Out Debt upon such terms and conditions as specified in the Securities
Demand; provided that (i) the interest rate (whether floating or
fixed) or dividend rate, as the case may be, shall be determined by the
Investment Bank in light of the then prevailing market conditions for
comparable securities but in no event shall the weighted average effective
yield on the Take-Out Debt exceed 12.88% per annum (excluding the PIK Margin); (ii) the
maturity of the Take-Out Debt shall be no less than eight years from the date
of issuance thereof; (iii) the Investment Bank, in its reasonable


 


50

















 


discretion after
consultation with the Company, shall determine whether the Take-Out Debt shall
be issued through a public offering or a private placement; (iv) the Take-Out
Debt will be issued pursuant to an indenture or other agreement or instrument
that shall contain such terms, conditions and covenants as are typical and
customary for similar financings and as are reasonably satisfactory in all
respects to the Investment Bank, the Company and the Administrative Agent; and (v) all
other arrangements with respect to the Take-Out Debt shall be reasonably
satisfactory in all respects to the Investment Bank in light of the then
prevailing market conditions.


 


(b)     The
Company will give the Administrative Agent prior notice of its intention to
file the registration statement or to effect a private placement of the
Take-Out Debt.  The Company will notify
the Administrative Agent promptly upon the receipt of any comments from the SEC
in connection with the registration statement, will furnish the Administrative
Agent with a copy of any written comments from the SEC, will respond in a
reasonably prompt manner and appropriately to any such comments and will
furnish a copy to the Administrative Agent of any such response to the SEC.


 


(c)     The
Company will deliver (and, if applicable, cause Holdings to deliver)
preliminary offering memoranda or preliminary prospectuses and other marketing
materials relating to the Senior ATA Notes usable in a customary high-yield
road show (with the industry section being written by Seabury Group or any
other airline industry expert having similar qualifications), which shall be
reasonably satisfactory to the Administrative Agent and shall comply with the rules and
regulations (including Regulation S-X) of the Securities Act, and shall in any
event include information that would be required in a registration statement on
Form S-1 for an offering registered under the Securities Act, including
without limitation the unaudited (or, in the case of fiscal years, audited)
financial statements of the Company (and, if applicable, Holdings) for the most
recent fiscal quarter or fiscal year then ended (each, a “Preliminary OM”) no later than (x) September 15,
2007 in the case of the Preliminary OM covering the fiscal quarter ended June 30,
2007, (y) November 15, 2007 in the case of the Preliminary OM
covering the fiscal quarter ended September 30, 2007 and (z) 45 days
after the end of each subsequent fiscal quarter (other than the fourth fiscal
quarter of any fiscal year) and 90 days after the end of each fiscal year.


 


5.10   Exchange Notes.  (a) The Company shall, prior to the
Initial Maturity Date, enter into the Indenture with a bank or trust company
acting as indenture trustee thereunder (the “Trustee”),
which shall be a corporation organized and doing business under the laws of the
United States of America or any state thereof, in good standing, which is
authorized under such laws to exercise corporate trust powers and is subject to
supervision or examination by Federal or state authority and which has a
combined capital and surplus of not less than $500,000,000.


 


(b)     Following
the Initial Maturity Date, the Company will, on or prior to the third Business
Day following the written request (the “Exchange
Request”) of any Lender execute, and cause the Trustee to
authenticate, and deliver to such Lender in accordance with the Indenture an
Exchange Note bearing interest as set forth therein in exchange for such Lender’s
Loan dated the date of the issuance of such Exchange Note, registered in the
name specified by such Lender, in the principal amount equal to 100% of the
aggregate principal amount (including any accrued and unpaid interest not
required to be paid in cash) of the Loans for which they are exchanged; provided
that Lenders have given Exchange Requests with respect to Initial Loans or Term
Loans in an aggregate principal amount equal to the lesser of $25,000,000 and
10% of the aggregate principal amount of the Initial Loans or Term Loans then
outstanding.  Each Exchange Request shall
specify the principal amount of the Loans to be exchanged pursuant to this Section 5.10,
which shall be at least $1,000,000 and, if such Lender holds Loan Notes, be
accompanied by the Loan Notes to be exchanged for Exchange Notes. Any Loan
Notes delivered to Company under this Section 5.10 in exchange for
Exchange Notes shall be canceled by the


 


51

















 


Company and the corresponding amount of the Lender’s Loan
deemed repaid and the Exchange Notes shall be governed by and construed in
accordance with the terms of the Indenture.


 


(c)     If
Exchange Notes are issued pursuant to the terms hereof, the holders of such
Exchange Notes shall have the registration rights set forth the Registration
Rights Agreement.


 


5.11   Use of Proceeds of the Take-Out
Debt.  Use the net proceeds
received by it from the sale of the Take-Out Debt to repay the Loans pursuant
to Section 2.5(a).


 


5.12   Additional Collateral.
 (a) With respect to any property
acquired after the Closing Date by any Loan Party that constitutes Collateral
under the Guaranty on Collateral Agreement (other than (x) any property
described in paragraph (b), (c) or (d) below and (y) Excluded
Property (as defined in the Guarantee and Collateral Agreement) as to which the
Administrative Agent, for the benefit of the Lenders, does not have a perfected
Lien, promptly (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement or such other documents as
the Administrative Agent reasonably requests, to grant to the Administrative
Agent, for the benefit of the Lenders, a security interest in such property and
(ii) take all actions reasonably requested by the Administrative Agent to
grant to the Administrative Agent, for the benefit of the Lenders, a perfected
first priority security interest in such property, including the filing of
Uniform Commercial Code financing statements in such jurisdictions as may be
requested by the Administrative Agent.


 


(b)     With
respect to any fee interest in any real property having a value (together with
improvements thereof) of at least $2,500,000 acquired after the Closing Date by
any Loan Party (other than (x) any such real property subject to a Lien
expressly permitted under clause (x) of the definition of “Permitted Liens”
and (y) real property acquired by any Excluded Foreign Subsidiary),
promptly.(i) execute and deliver a first priority Real Estate Mortgage
subject to Permitted Liens, in favor of the Administrative Agent, for the
benefit of the Lenders, covering such real property, (ii) if reasonably
requested by the Administrative Agent, provide the Lenders with (x) title
and extended coverage insurance covering such real property in an amount equal
to the purchase price of such real property as well as current ALTA survey
thereof, together with any surveyor’s certificate that exists and (y) use
commercially reasonable efforts to obtain any consents or estoppels reasonably
deemed necessary or advisable by the Administrative Agent in connection with
such Real Estate Mortgage, each of the foregoing in form and substance
reasonably satisfactory to the Administrative Agent and (iii) if
reasonably requested by the Administrative Agent, deliver to the Administrative
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to
the Administrative Agent.


 


(c)     With
respect to any aircraft (including the related engines and spare engines)
acquired after the Closing Date by any Loan Party that is not financed or to be
financed by Aircraft Acquisition Debt (and any such Aircraft Mortgage shall
provide for the release of such assets upon the incurrence of Aircraft
Acquisition Debt or the entering into a Sale/Leaseback Transaction in respect
of such assets in accordance with Sections 6.1 and 6.11), promptly (i) execute
and deliver an Aircraft Mortgage in favor of the Administrative Agent, for the
benefit of the Lenders, covering such assets, and the other documents referred
to in Section 4(o)(ii), each of the foregoing in form and substance
reasonably satisfactory to the Administrative Agent and (iii) if
reasonably requested by the Administrative Agent, deliver to the Administrative
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to
the Administrative Agent.


 


(d)     With
respect to any new Subsidiary (other than an Excluded Foreign Subsidiary)
created or acquired after the Closing Date by any Loan Party (which, for the
purposes of this


 


52

















 


paragraph (c), shall include any existing Subsidiary that
ceases to be an Excluded Foreign Subsidiary), promptly (i) execute and
deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement as the Administrative Agent deems necessary or desirable
to grant to the Administrative Agent, for the benefit of the Lenders, a
perfected first priority security interest in the Capital Stock of such new
Subsidiary that is owned by any Loan Party, (ii) deliver to the
Administrative Agent the certificates representing such Capital Stock, together
with undated stock powers, in blank, executed and delivered by a duly
authorized officer of the relevant Loan Party, (iii) cause such new
Subsidiary (A) to become a party to the Guarantee and Collateral
Agreement, (B) to take such actions reasonably requested by the Administrative
Agent to grant to the Administrative Agent for the benefit of the Lenders a
perfected first priority security interest in the Collateral described in the
Guarantee and Collateral Agreement with respect to such new Subsidiary,
including the filing of Uniform Commercial Code financing statements in such
jurisdictions as may be requested by the Administrative Agent and (C) to
deliver to the Administrative Agent a certificate of such Subsidiary,
substantially in the form of Exhibit C,
with appropriate insertions and attachments and (D) if such new Subsidiary
owns any aircraft that is not financed or to be financed by Aircraft
Acquisition Debt, execute and deliver an Aircraft Mortgage (which shall provide
for the release of such assets upon the incurrence of Aircraft Acquisition Debt
or the entering into a Sale/Leaseback Transaction in respect of such assets in
accordance with Sections 6.1 and 6.11) in favor of the Administrative Agent,
for the benefit of the Lenders, covering such property, and the other documents
referred to in Section 4(o)(ii), each of the foregoing in form and
substance reasonably satisfactory to the Administrative Agent, and (iv) if
reasonably requested by the Administrative Agent, deliver to the Administrative
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to
the Administrative Agent.


 


(e)     With
respect to any new Excluded Foreign Subsidiary created or acquired after the
Closing Date by any Loan Party, promptly (i) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement
as the Administrative Agent reasonably requests to grant to the Administrative
Agent, for the benefit of the Lenders, a perfected first priority security
interest in the Capital Stock of such new Subsidiary that is owned by any such
Loan Party (provided that in no event shall more than 66% of the total
outstanding voting Capital Stock of any such new Subsidiary be required to be
so pledged), (ii) deliver to the Administrative Agent the certificates
representing such Capital Stock, together with undated stock powers, in blank,
executed and delivered by a duly authorized officer of the relevant Loan Party,
and take such other action as may be reasonably requested by the Administrative
Agent to perfect the Administrative Agent’s security interest therein, and (iii) if
reasonably requested by the Administrative Agent, deliver to the Administrative
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to
the Administrative Agent.


 


5.13   Post-Closing Matters.  (a) Within 60 days after the Closing Date
or such longer period reasonably satisfactory to the Administrative Agent, the
Company agrees to take or cause to be taken the actions to perfect the security
interest in all items of Collateral, described in Section 4(n), Section 4(o) (including
the delivery of the corresponding opinions from FAA counsel) and Schedule 3.21(a) of
this Agreement and in Section 5.10 and Schedule 3 of the Guarantee and
Collateral Agreement that were not completed on the Closing Date.


 


(b)     Within
30 days after the Closing Date or such longer period reasonably satisfactory to
the Administrative Agent, the Company agrees to provide to the Administrative
Agent (i) evidence of insurance complying with the requirements of Section 5.5(b) of
this Agreement and Section 5.2 of the Guarantee and Collateral Agreement
and (ii) an insurance broker’s or agent’s certificate certifying that the
insurance coverage maintained by the Company and its Subsidiaries are endorsed
or amended to include a “standard” or New York” lender’s loss payable
endorsement and name the Administrative Agent as 


 


53

















 


additional insured/loss payee, in
each case in form and substance reasonably satisfactory to the Administrative
Agent. Notwithstanding the foregoing, the certificates described above shall
also provide that (i) the insurers thereunder shall waive all rights of
subrogation against the Administrative Agent and the Lenders, any right of
setoff or counterclaim and any other right to deduction, whether by attachment
or otherwise; (ii) such insurance shall be primary without right of
contribution of any other insurance carried by or on behalf of the
Administrative Agent or the Lenders; and, (iii) if such insurance is
cancelled for any reason whatsoever, including nonpayment of premium, or any
changes are initiated by the Company or carrier which affect the interests of
the Administrative Agent or the Lenders, such cancellation or change shall not
be effective as to the Administrative Agent (on behalf of the Lenders) until
thirty (30) days thereafter, except in the case of non-payment of premium,
which shall not be effective as to the Administrative Agent or the Lenders
until ten (10) days after such cancellation or change, in each case after
receipt by the Administrative Agent (on behalf of the Lenders) of written
notice sent by registered mail from such insurer.


 


(c)     No
later than September 15, 2007 or such longer period reasonably
satisfactory to the Administrative Agent, the Company shall provide to the
Administrative Agent a five-year model reflecting updated accounting policies
with respect to maintenance expenses.


 


5.14     Further Assurances.  Execute any and all further documents and
instruments, and take all further actions, that the Administrative Agent may
reasonably request, in order to create, grant, establish, preserve, protect and
perfect the validity, perfection and priority of the Liens and security
interests created or intended to be created by the Security Documents, to the
extent required under this Agreement or the Security Documents, including,
without limitation, amending, amending and restating, supplementing, assigning
or otherwise modifying, renewing or replacing any Aircraft Mortgage or other
agreements, instruments or documents relating thereto, in each case as may be
reasonably requested by the Administrative Agent, in order to (i) create
interests (including, but not limited to, International Interests, Assignments,
Prospective International Interests, Prospective Assignments, Sales,
Prospective Sales, Assignments of Associated Rights and Subordinations as each
such term is defined in the Cape Town Convention) that may be registered and/or
assigned under the Cape Town Convention, (ii) create, grant, establish,
preserve, protect and perfect the Liens in favor of the Administrative Agent
for the benefit of the Lenders to the fullest extent possible under the Cape
Town Convention, including, where necessary, the subordination of other rights
or interests and (iii) realize the benefit of the remedial provisions that
are contemplated by the Cape Town Convention, subject to the provisions of the
Aircraft Mortgages.


 


SECTION 6.  NEGATIVE
COVENANTS


 


Except as modified on the Initial Maturity
Date as set forth in Section 9.1, so long as any Loan or Loan Note remains
outstanding and unpaid, or any other amount is due and owing to any Lender or
the Administrative Agent hereunder or under any other Loan Document:


 


6.1     Limitation on Indebtedness.
 (a) The Company shall not, and
shall not permit any of its Subsidiaries to, Incur any Indebtedness (including
Acquired Indebtedness), except:


 


(i)      Indebtedness represented by this
Agreement, the Loan Notes, the Guarantees under the Guarantee and Collateral
Agreement and other Guarantees by the Subsidiary Guarantors of Indebtedness
Incurred in accordance with the provisions of this Agreement;


 


(ii)     Indebtedness of the Company owing to and
held by any Subsidiary or Indebtedness of a Subsidiary owing to and held by the
Company or any Subsidiary; provided,


 


54

















 


however, that (A) if the Company is the obligor on such Indebtedness and a
Subsidiary Guarantor is not the obligee, such Indebtedness is expressly
subordinated in right of payment from and after such time as the Loans shall
become due and payable (whether at Stated Maturity, acceleration or otherwise)
to the prior payment in full in cash of all obligations with respect to the
Loans, (B) if a Subsidiary Guarantor is the obligor on such Indebtedness
and the Company or a Subsidiary Guarantor is not the obligee, such Indebtedness
constitutes a Guarantor Subordinated Obligation and (C)(1) any subsequent
issuance or transfer of Capital Stock or any other event which results in any
such Indebtedness being beneficially held by a Person other than the Company or
a Subsidiary of the Company and (2) any sale or other transfer of any such
Indebtedness to a Person other than the Company or a Subsidiary of the Company
shall be deemed, in each case, to constitute an Incurrence of such Indebtedness
by the issuer thereof;


 


(iii)    Indebtedness
represented by (x) the Take-Out Debt, (y) any Indebtedness (other
than the Indebtedness described in clauses (i), (ii), (iv), (v), (vi), (vii),
(viii), (ix), (x) and (xvii) of this Section 6.1(a)) outstanding on
the Closing Date (including Aircraft Acquisition Debt outstanding on the
Closing Date) and set forth on Schedule 6.1(a)(iii) and (z) any
Refinancing Indebtedness Incurred in respect of any Indebtedness described in
this clause (iii);


 


(iv)    Indebtedness under Hedging Obligations that
are Incurred in the ordinary course of business (and not for speculative
purposes);


 


(v)     the Incurrence by the Company or any of its
Subsidiaries of (A) Indebtedness represented by Capitalized Lease
Obligations, mortgage financings, purchase money obligations or other payments,
in each case Incurred to finance all or any part of the purchase price or cost
of construction or improvement of aircraft, aircraft engines, spare parts,
other aircraft-related equipment (including ground equipment), plant, equipment
or property (including the cost of design, development, acquisition,
construction, installation, improvement, transportation or integration but
excluding Capital Stock or other Investments) acquired, constructed or improved
in the ordinary course of business of the Company or such Subsidiary, and (B) Attributable
Indebtedness, in an aggregate principal amount, including all Refinancing
Indebtedness Incurred to refund, defease, renew, extend, refinance or replace
any Indebtedness Incurred pursuant to this clause (v), not to exceed the sum of
(1) any prepayment, repayment, redemption or other discharge or reduction
of such Indebtedness or Attributable Indebtedness outstanding on the Closing
Date or under Refinancing Indebtedness in respect thereof (other than with the
proceeds of or in exchange for Refinancing Indebtedness) and (2) $10,000,000
at any time outstanding;


 


(vi)    Indebtedness Incurred in respect of workers’
compensation claims, health, disability or other employee benefits or insurance
or self-insurance obligations, performance, surety and similar bonds and
completion guarantees provided by the Company or a Subsidiary in the ordinary
course of business;


 


(vii)   Indebtedness
arising from agreements of the Company or a Subsidiary providing for
indemnification, adjustment of purchase price or similar obligations, in each
case, Incurred or assumed in connection with the disposition of any business,
assets or Capital Stock of a Subsidiary in accordance with the terms of this
Agreement, other than Guarantees by the Company or any Subsidiary of
Indebtedness Incurred by any Person acquiring all or any portion of such
business, assets or a Subsidiary of the Company for the purpose of financing
such acquisition; provided that
the maximum aggregate liability in respect of all such 


 


55

















 


Indebtedness shall at no time exceed the gross proceeds actually
received by the Company and its Subsidiaries in connection with such
disposition;


 


(viii)  Indebtedness
arising from the honoring by a bank or other financial institution of a check,
draft or similar instrument (except in the case of daylight overdrafts) drawn
against insufficient funds in the ordinary course of business, provided, however, that such Indebtedness
is extinguished within five Business Days of Incurrence;


 


(ix)    Indebtedness Incurred in satisfaction of “return
condition” obligations of the Company or its Subsidiaries under aircraft leases
in an aggregate principal amount not to exceed $5,000,000 at any time outstanding;


 


(x)     Indebtedness consisting of Indebtedness
issued by the Company or any of its Subsidiaries to current or former officers,
directors, consultants and employees thereof, their respective estates, spouses
or former spouses, in each case to finance the purchase or redemption of
Capital Stock of the Company or any direct or indirect parent company of the
Company to the extent described in Section 6.2(b)(v)(E), in an aggregate
amount not to exceed $1,000,000 at any one time outstanding;


 


(xi)    Indebtedness of any of the Company and the
Subsidiary Guarantors to credit card processors in connection with credit card
processing services incurred in the ordinary course of business of the Company
and the Subsidiary Guarantors;


 


(xii)   Aircraft
Acquisition Debt and Capitalized Lease Obligations and Attributable
Indebtedness in respect of Specified Aircraft;


 


(xiii)  To
the extent constituting Indebtedness, judgments, decrees, attachments or awards
not constituting an Event of Default under Section 7(g);


 


(xiv)  Indebtedness
constituting Permitted Investments under clause (xvi) of the definition
thereof;


 


(xv)   cash
management obligations and other Indebtedness in respect of netting services,
overdraft protection and similar arrangements in each case in connection with
deposit accounts incurred in the ordinary course of business in connection with
cash management activities;


 


(xvi)     Guarantees
by (x) the Company or Subsidiary Guarantors of Indebtedness Incurred by
the Company or a Subsidiary Guarantor in accordance with this Agreement; provided that in the event such
Indebtedness that is being Guaranteed is a Subordinated Obligation, then the
related Guarantee shall be subordinated in right of payment to the Loans or the
Subsidiary Guarantee, as the case may be, and (y) in accordance with this
Agreement;


 


(xvii)    Indebtedness in respect of letters of credit
issued in the ordinary course of business, which shall include Indebtedness in
respect of letters of credit issued pursuant to the LC Credit Facility or the
Wachovia Facility, in an aggregate amount of up to $30,000,000 outstanding at
any time, such Indebtedness being secured only by deposits described in clause (xxiv)
of the definition of Permitted Liens; and


 


(xviii) other Indebtedness which (x) is unsecured or (y) if secured,
is secured only by nonconsensual Permitted Liens imposed by operation of law
or, if in the form of letters of


 


56

















 


credit, secured only by deposits described in clause (xxiv) of the
definition of Permitted Liens, in an aggregate principal amount not exceeding
$25,000,000 at any time outstanding.


 


(b)     Notwithstanding
the foregoing, the Company shall not Incur any Indebtedness under Section 6.1(a) if
the proceeds thereof are used, directly or indirectly, to refinance any
Subordinated Obligations unless such Indebtedness shall be subordinated to the
Loans to at least the same extent as such Subordinated Obligations. No
Subsidiary Guarantor shall Incur any Indebtedness under Section 6.1(a) if
the proceeds thereof are used, directly or indirectly, to refinance any
Subordinated Obligations of such Subsidiary Guarantor unless such Indebtedness
shall be subordinated to the obligations of such Subsidiary Guarantor under its
Guarantees under the Guarantee and Collateral Agreement to at least the same
extent as such Subordinated Indebtedness. 
No Subsidiary (other than a Subsidiary Guarantor) may Incur Indebtedness
if the proceeds are used to refinance Indebtedness of the Company or a
Subsidiary Guarantor.


 


(c)     For
purposes of determining compliance with, and the outstanding principal amount
of any particular Indebtedness Incurred pursuant to and in compliance with,
this covenant:


 


(i)      in the event that Indebtedness meets the
criteria of more than one of the types of Indebtedness described in Section 6.1,
the Company, in its sole discretion, will classify such item of Indebtedness on
the date of Incurrence and may later classify such item of Indebtedness in any
manner that complies with this covenant and only be required to include the
amount and type of such Indebtedness in one of such clauses;


 


(ii)     guarantees of, or obligations in respect of
letters of credit relating to, Indebtedness which is otherwise included in the
determination of a particular amount of Indebtedness shall not be included;


 


(iii)    the
principal amount of any Disqualified Stock of the Company or a Subsidiary, or
Preferred Stock of a Subsidiary that is not a Subsidiary Guarantor, will be
equal to the greater of the maximum mandatory redemption or repurchase price
(not including, in either case, any redemption or repurchase premium) or the
liquidation preference thereof;


 


(iv)    Indebtedness permitted by this covenant need
not be permitted solely by reference to one provision permitting such
Indebtedness but may be permitted in part by one such provision and in part by
one or more other provisions of this covenant permitting such Indebtedness; and


 


(v)     the amount of Indebtedness issued at a
price that is less than the principal amount thereof will be equal to the
amount of the liability in respect thereof determined in accordance with GAAP.


 


Accrual of interest, accrual of dividends,
the accretion of accreted value, the payment of interest in the form of
additional Indebtedness and the payment of dividends in the form of additional
shares of Preferred Stock or Disqualified Stock will not be deemed to be an
incurrence of Indebtedness for purposes of this covenant. The amount of any
Indebtedness outstanding as of any date shall be (i) the accreted value of
the Indebtedness in the case of any Indebtedness issued with original issue
discount and (ii) the principal amount or liquidation preference thereof,
together with any interest thereon that is more than 30 days past due, in the
case of any other Indebtedness.  For
purposes of determining
compliance with any U.S. dollar-denominated restriction on the Incurrence of
Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness
denominated in a foreign currency shall be calculated based on the relevant
currency exchange rate in effect on the date such Indebtedness was Incurred, in
the case of term


 


57

















 


Indebtedness,
or first committed, in the case of revolving credit Indebtedness; provided that
if such Indebtedness is Incurred to refinance other Indebtedness denominated in
a foreign currency, and such refinancing would cause the applicable U.S.
dollar-dominated restriction to be exceeded if calculated at the relevant
currency exchange rate in effect on the date of such refinancing, such U.S.
dollar-dominated restriction shall be deemed not to have been exceeded so long
as the principal amount of such refinancing Indebtedness does not exceed the
principal amount of such Indebtedness being refinanced.  Notwithstanding any other provision of this Section 6.1,
the maximum amount of Indebtedness that the Company may Incur pursuant to this
covenant shall not be deemed to be exceeded solely as a result of fluctuations
in the exchange rate of currencies. The principal amount of any Indebtedness
Incurred to refinance other Indebtedness, if Incurred in a different currency
from the Indebtedness being refinanced, shall be calculated based on the
currency exchange rate applicable to the currencies in which such Refinancing
Indebtedness is denominated that is in effect on the date of such refinancing.


 


6.2     Limitation on Restricted
Payments.  (a) The
Company shall not, and shall not permit any Subsidiary, directly or indirectly,
to (i) declare or pay any dividend or make any distribution (whether made
in cash, securities or other property) on or in respect of its Capital Stock
(including any payment in connection with any merger or consolidation involving
the Company or any of its Subsidiaries) except dividends or distributions
payable in Capital Stock of the Company (other than Disqualified Stock) or in
options, warrants or other rights to purchase such Capital Stock of the Company
and except dividends or distributions payable to the Company, another
Subsidiary or to each other owner of Capital Stock of such Subsidiary based on
their relative ownership interests of the relevant class of Capital Stock, (ii) purchase,
redeem, retire or otherwise acquire for value any Capital Stock of the Company
or any direct or indirect parent of the Company held by Persons other than the
Company or a Subsidiary (other than in exchange for Capital Stock of the
Company (other than Disqualified Stock)); (iii) purchase, repurchase,
redeem, defease or otherwise acquire or retire for value, prior to scheduled
maturity, scheduled repayment or scheduled sinking fund payment, any
Subordinated Obligations or Guarantor Subordinated Obligations (other than (x) Indebtedness
of the Company owing to and held by any Subsidiary Guarantor or Indebtedness of
a Subsidiary Guarantor owing to and held by the Company or any other Subsidiary
Guarantor permitted under Section 6.1(a)(iii) or (y) the
purchase, repurchase, redemption, defeasance or other acquisition or retirement
of Subordinated Obligations or Guarantor Subordinated Obligations purchased in
anticipation of satisfying a sinking fund obligation, principal installment or
final maturity, in each case due within one year of the date of purchase,
repurchase, redemption, defeasance or other acquisition or retirement), or (iv) make
any Restricted Investment in any Person (any such dividend, distribution,
purchase, redemption, repurchase, defeasance, other acquisition, retirement or
Restricted Investment referred to in clauses (i) through (iv) being
herein referred to as a “Restricted Payment”).


 


(b)     The
provisions of Section 6.2(a) shall not prohibit:


 


(i)      any purchase, repurchase, redemption,
defeasance or other acquisition or retirement of Capital Stock, Disqualified
Stock or Subordinated Obligations of the Company or Guarantor Subordinated
Obligations of any Subsidiary Guarantor made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Capital Stock of the Company
or Holdings (to the extent that Holdings contributes the proceeds of such
substantially concurrent sale to the Company as common equity capital) (other
than Disqualified Stock and other than Capital Stock issued or sold to a
Subsidiary or an employee stock ownership plan or similar trust to the extent
such sale to an employee stock ownership plan or similar trust is financed by
loans from or Guaranteed by the Company or any Subsidiary unless such loans
have been repaid with cash on or prior to the date of determination);


 


58

















 


(ii)     any purchase, repurchase, redemption,
defeasance or other acquisition or retirement of Subordinated Obligations of
the Company or Guarantor Subordinated Obligations of any Subsidiary Guarantor
made by exchange for, or out of the proceeds of the substantially concurrent
sale of, Subordinated Obligations of the Company or any purchase, repurchase,
redemption, defeasance or other acquisition or retirement of Guarantor
Subordinated Obligations made by exchange for or out of the proceeds of the
substantially concurrent sale of Guarantor Subordinated Obligations that, in
each case, is permitted to be Incurred pursuant to Section 6.1 and that in
each case constitutes Refinancing Indebtedness;


 


(iii)    any
purchase, repurchase, redemption, defeasance or other acquisition or retirement
of Disqualified Stock of the Company or a Subsidiary made by exchange for or
out of the proceeds of the substantially concurrent sale of Disqualified Stock
of the Company or such Subsidiary, as the case may be, that, in each case, is
permitted to be Incurred pursuant to Section 6.1 and that in each case
constitutes Refinancing Indebtedness;


 


(iv)    repurchases of Capital Stock deemed to occur
upon the exercise of stock options, warrants or other convertible securities if
such Capital Stock represents a portion of the exercise price thereof;


 


(v)     cash dividends, distributions, loans or
other transfers directly or indirectly to Holdings in amounts equal to:


 


(A)     the amounts required for Holdings and
IntermediateCo to pay any Federal, state or local income taxes to the extent
that such income taxes are directly attributable to the income of the Company
and its Subsidiaries;


 


(B)     the amounts required for Holdings and
IntermediateCo to pay franchise taxes and other fees required to maintain their
respective legal existence;


 


(C)     an amount to permit Holdings and
IntermediateCo to pay their respective corporate overhead expenses incurred in
the ordinary course of business, and to pay salaries or other compensation of
employees, directors and consultants who perform services for Holdings,
IntermediateCo and the Company;


 


(D)     fees and expenses related to any
unsuccessful equity or debt offering or other financing transaction of, or
otherwise payable in connection with the Transactions and in accordance with Section
6.2(b)(vi) below by, such parent entity; and


 


(E)      the amounts required by Holdings to permit
Holdings to pay for the purchase, redemption or other acquisition, cancellation
or retirement for value of Capital Stock of the Company or any direct or
indirect parent of the Company held by any existing, former or future
employees, management, consultants or directors of the Company or Holdings or
any Subsidiary of the Company or their assigns, estates or heirs, (or loans or
cash dividends distributed to Holdings for the purpose of consummating such
purchase, redemption or other acquisition, cancellation or retirement for
value), in each case in connection with the repurchase provisions under
employee, director or consultant stock option or stock purchase agreements or
any other employee or director benefit plan or agreements to compensate
management employees; provided that such redemptions or repurchases
pursuant to this clause will not exceed $5,000,000 in the aggregate during any
calendar year and $10,000,000 in the aggregate for all such redemptions and
repurchases, plus to the extent not previously applied the amount of any
capital


 


59

















 


contributions to the Company as a result of sales of
Capital Stock of the Company or any direct or indirect parent of the Company to
such persons, provided, further,
that cancellation of Indebtedness owing to the Company or any Subsidiary from
members of management of the Company, any of the Company’s direct or indirect parent
companies or any of the Company’s Subsidiaries in connection with a repurchase
of Capital Stock of the Company or any of its direct or indirect parent
companies will not be deemed to constitute a Restricted Payment for purposes of
this Section 6.2 or any other provision of this Agreement; and


 


(F)      the amounts required by Holdings to permit
Holdings to make all payments required pursuant to the terms of any Take-Out
Debt issued by Holdings.


 


(vi)    any payments made in connection with the
Transactions pursuant to the Merger Agreement and any other agreements or
documents related to the Transactions and set forth on Schedule 6.2(b)(vi) in
effect on the Closing Date (without giving effect to subsequent amendments,
waivers or other modifications to such agreements or documents).


 


The amount of all Restricted Payments (other
than cash) shall be the fair market value on the date of such Restricted
Payment of the asset(s) or securities proposed to be paid, transferred or
issued by the Company or such Subsidiary, as the case may be, pursuant to such
Restricted Payment.


 


6.3     Limitation
on Restrictions on Distributions from Subsidiaries.  The Company shall not, and shall not permit
any of its Subsidiaries to, create or otherwise cause or permit to exist or
become effective any consensual encumbrance or consensual restriction on the
ability of any such Subsidiary to (i) pay dividends or make any other
distributions on its Capital Stock or pay any Indebtedness or other obligations
owed to the Company or any Subsidiary (it being understood that the priority of
any Preferred Stock in receiving dividends or liquidating distributions prior
to dividends or liquidating distributions being paid on Common Stock shall not
be deemed a restriction on the ability to make distributions on Capital Stock);
(ii) make any loans or advances to the Company or any Subsidiary (it being
understood that the subordination of loans or advances made to the Company or
any Subsidiary to other Indebtedness Incurred by the Company or any Subsidiary shall
not be deemed a restriction on the ability to make loans or advances); or (iii) transfer
any of its property or assets to the Company or any Subsidiary (it being
understood that such transfers shall not include any type of transfer described
in clause (i) or (ii) above); except:


 


(a)     any encumbrance or restriction pursuant to
an agreement in effect at or entered into on the Closing Date and identified on
Schedule 6.3(a), including, without limitation, this Agreement and the Security
Documents;


 


(b)     any encumbrance or restriction with respect
to a Subsidiary pursuant to an agreement effecting a refunding, replacement or
refinancing of Indebtedness Incurred pursuant to an agreement referred to in
clause (a) above or this clause (b) or contained in any amendment,
restatement, modification, renewal, supplement, refunding, replacement or
refinancing of an agreement referred to in clause (a) above or this clause
(c); provided, however, that the
encumbrances and restrictions with respect to such Subsidiary contained in any
such agreement are no less favorable in any material respect, taken as a whole,
to the Lenders than the encumbrances and restrictions contained in such
agreements referred to in clause (a) above on the Closing Date or the date
such Subsidiary became a Subsidiary or was merged into a Subsidiary, whichever
is applicable;


 


60

















 


(c)     in the case of clause (iii) of the
lead-in paragraph of this Section 6.3, any encumbrance or restriction:


 


(x)       that restricts in a customary manner the
subletting, assignment or transfer of any property or asset that is subject to
a lease, license or similar contract, or the assignment or transfer of any such
lease, license or other contract;


 


(y)      contained in mortgages, pledges or other
security agreements permitted under this Agreement securing Indebtedness of the
Company or a Subsidiary to the extent such encumbrances or restrictions
restrict the transfer of the property subject to such mortgages, pledges or
other security agreements; or


 


(z)       pursuant to customary provisions
restricting dispositions of real property interests set forth in any reciprocal
easement agreements of the Company or any Subsidiary;


 


(d)     (i) purchase money obligations for
property acquired in the ordinary course of business and (ii) Capitalized
Lease Obligations permitted under this Agreement, in each case, that impose
encumbrances or restrictions of the nature described in clause (iii) of
the lead-in paragraph of this Section 6.3 on the property so acquired;


 


(e)     any restriction with respect to a
Subsidiary (or any of its property or assets) imposed pursuant to an agreement
entered into for the direct or indirect sale or disposition of the Capital
Stock or assets of such Subsidiary (or the property or assets that are subject
to such restriction) pending the closing of such sale or disposition;


 


(f)      net worth provisions in leases and other
agreements entered into by the Company or any Subsidiary in the ordinary course
of business;


 


(g)     encumbrances or restrictions arising or
existing by reason of applicable law or any applicable rule, regulation or
order;


 


(h)     encumbrances or restrictions contained in
indentures or debt instruments or other debt arrangements Incurred or Preferred
Stock issued by Subsidiary Guarantors in accordance with Section 6.1 that
are not more restrictive, taken as a whole, than those applicable to the
Company in this Agreement on the Closing Date (which results in encumbrances or
restrictions comparable to those applicable to the Company at a Subsidiary
level);


 


(i)      restrictions on cash or other deposits or
net worth imposed by customers under contracts entered into the ordinary course
of business;


 


(j)      customary provisions in joint venture
agreements and other similar agreements relating solely to such joint venture;
and


 


(k)     customary provisions contained in leases
and other agreements, in each case entered into in the ordinary course of
business.


 


6.4     Limitation on Sales of Assets
and Subsidiary Stock. (a) The Company shall not, and shall not
permit any of its Subsidiaries to, make any Asset Disposition unless:  (i) the Company or such Subsidiary, as
the case may be, receives consideration at least equal to the fair market value
(such fair market value to be determined on the date of contractually agreeing
to such Asset Disposition), as


 


61

















 


determined in good faith by
the Board of Directors (including as to the value of all non-cash
consideration), of the property or asset subject to such Asset Disposition; (ii) prior
to the Initial Maturity Date, 100%, and from and after the Initial Maturity
Date, at least 80% of the consideration from such Asset Disposition received by
the Company or such Subsidiary, as the case may be, is in the form of cash or
Cash Equivalents and 100% of the Net Available Cash therefrom is deposited
directly by the Company (or the Subsidiary that owned the sold assets, as the
case may be) into a segregated Collateral Account, under the sole control of
the Administrative Agent, that includes only proceeds from Asset Dispositions
and interest earned thereon (“Collateral
Account”) and is free from all other Liens, all on terms and
pursuant to arrangements reasonably satisfactory to the Administrative Agent in
its reasonable determination (which may include, at the Administrative Agent’s
reasonable request, customary officer’s certificates and opinions of counsel
and shall include release provisions requiring the Administrative Agent to
release deposits in the Collateral Account as requested to permit the Company
or its Subsidiaries to apply such Net Available Cash in the manner described in
the immediately succeeding paragraph below, unless the Administrative Agent has
received written notice that an Event of Default has occurred and is
continuing); and (iii) the remaining consideration from such Asset
Disposition that is not in the form of cash or Cash Equivalents is thereupon
with its acquisition pledged as Collateral to secure the Loans and the
Guarantees under the Guarantee and Collateral Agreement on a first-priority
basis.


 


(b)     An
amount equal to 100% of the Net Available Cash deposited into the Collateral
Account from any Asset Dispositions may be withdrawn by the Company (or such
Subsidiary, as the case may be) to be invested by the Company or such
Subsidiary in Additional Assets constituting Collateral to be owned by the
Company or a Subsidiary Guarantor within 365 days of the date of such Asset
Disposition and the Administrative Agent shall promptly be granted a perfected
first-priority security interest on all such Additional Assets as Collateral
under the Security Documents to secure the Loans and the Guarantees under the
Guarantee and Collateral Agreement on terms and pursuant to arrangements
reasonably satisfactory to the Administrative Agent in its reasonable
determination (which may include, at the Administrative Agent’s reasonable
request, customary officer’s certificates and legal opinions.


 


(c)     In
addition, upon receipt of any Net Available Cash from a Casualty Event, the
Company (or the Subsidiary that owned those assets, as the case may be) shall
treat such Net Available Cash as if it were proceeds of an Asset Disposition
and apply such proceeds in accordance with this Section 6.4(a).


 


(d)     If
on or prior to the Initial Maturity Date, the Company shall determine that it
will not or does not intend to use any amount then deposited in the Collateral
Account to invest, or to have a Subsidiary invest, in Additional Assets, the
Company shall apply such amount toward the prepayment of the Loans in
accordance with Section 2.5.


 


6.5     Limitation on Liens.  The Company shall not, and shall
not permit any Subsidiary to, directly or indirectly, create, Incur or suffer
to exist any Lien (other than Permitted Liens) upon any of its property or
assets (including Capital Stock of Subsidiaries), whether owned on the Closing
Date or acquired after that date, which Lien is securing any Indebtedness; provided
that the Company and its Subsidiaries may incur Liens (in addition to Permitted
Liens) securing Indebtedness on property or assets that are not Collateral if
the Loans and the Guarantees under the Guarantee and Collateral Agreement are
equally and ratably secured by a Lien on such property or assets or are secured
by a Lien on such property or assets that is senior in right of priority to
such Liens.


 


6.6     Limitation on Affiliate Transactions.  (a) The Company will not, and
will not permit any of its Subsidiaries to, directly or indirectly, enter into
or conduct any transaction (including the purchase, sale, lease or exchange of
any property or the rendering of any service) with any Affiliate of the Company
(an “Affiliate Transaction”)
unless: (i) the terms of such Affiliate Transaction are no less


 


62

















 


favorable to the Company or such Subsidiary, as the
case may be, than those that could be obtained in a comparable transaction at
the time of such transaction in arm’s-length dealings with a Person who is not
such an Affiliate; (ii) in the event such Affiliate Transaction involves
an aggregate consideration in excess of $20,000,000, the terms of such
transaction have been approved by a majority of the members of the Board of
Directors of the Company and by a majority of the members of such Board having
no personal stake in such transaction, if any (and such majority or majorities,
as the case may be, determines that such Affiliate Transaction satisfies the
criteria in clause (i) above); and (iii) in the event such Affiliate
Transaction involves an aggregate consideration in excess of $30,000,000 prior
to the Initial Maturity Date and $40,000,000 thereafter, the Company has
received a written opinion from an independent investment banking, accounting
or appraisal firm of nationally recognized standing that such Affiliate
Transaction is not materially less favorable than those that might reasonably
have been obtained in a comparable transaction at such time on an arm’s-length
basis from a Person that is not an Affiliate.


 


(b)      The
foregoing provisions of Section 6.6(a) shall not apply to:


 


(i)      transactions
between or among the Company and its Subsidiaries;


 


(ii)     any
Permitted Investment and any Restricted Payment permitted to be made pursuant
to Section 6.2;


 


(iii)    any
issuance of securities, or other payments, awards or grants in cash, securities
or otherwise pursuant to, or the funding of, employment agreements and other
compensation arrangements, options to purchase Capital Stock of the Company,
restricted stock plans, long-term incentive plans, stock appreciation rights
plans, participation plans or similar employee or directors benefits plans
and/or indemnity provided on behalf of officers and employees;


 


(iv)    payments, advances or loans (or cancellation
of loans) to employees, officers or directors of the Company, any of its direct
or indirect parent companies or any Subsidiary of the Company in the ordinary
course of business consistent with past practices in an aggregate amount not in
excess of $1,000,000 with respect to all loans or advances made since the
Closing Date (without giving effect to the forgiveness of any such loan);


 


(v)     Guarantees issued by the Company or a
Subsidiary for the benefit of the Company or a Subsidiary, as the case may be,
in accordance with Section 6.1;


 


(vi)    the payment of customary compensation,
benefits, and reimbursement of reasonable out-of-pocket expenses to, and
indemnities provided for the benefit of, officers, directors, employees or
consultants of the Company, any of its direct or indirect parent companies or
any of its Subsidiaries;


 


(vii)   the existence of, and the performance of obligations of the
Company or any of its Subsidiaries under the terms of any agreement to which
the Company or any of its Subsidiaries is a party as of or on the Closing Date
and identified on Schedule 6.6(b), including, without limitation, the Merger
Documents, as these agreements may be amended, modified, supplemented, extended
or renewed from time to time; provided,
however, that any future amendment, modification, supplement,
extension or renewal entered into after the Closing Date will be permitted to
the extent that its terms taken as a whole are not more disadvantageous to the
Lenders than the terms of the relevant agreements in effect on the Closing
Date;


 


63

















 


(viii)  any
issuance or sale of Capital Stock (other than Disqualified Stock) to Affiliates
of the Company and the granting of registration and other customary rights in
connection therewith;


 


(ix)    any agreement between any Person and an
Affiliate of such Person existing at the time such Person is acquired by or
merged into the Company or a Subsidiary; provided that such agreement
was not entered into in contemplation of such acquisition or merger, or any
amendment thereto (so long as any such amendment is not disadvantageous to the
Lenders in the good faith judgment of the Board of Directors of the Company
when taken as a whole as compared to the applicable agreement as in effect on
the date of such acquisition or merger); and


 


(x)     transactions with customers, clients,
suppliers, joint venture partners or purchasers or sellers of goods or
services, in each case in the ordinary course of business and otherwise in
compliance with the terms of this Agreement, in each case which are fair to the
Company and its Subsidiaries, in the reasonable determination of the Board of
Directors of the Company or the senior management thereof, or are on terms at
least as favorable as would reasonably have been obtained at such time from an
unaffiliated party.


 


6.7     Change of Control.  Upon a Change of Control, the Company shall
immediately prepay the Loans and pay accrued and unpaid interest thereon, if
any, to the date of prepayment.


 


6.8     Limitation on Sale of Voting Stock of Subsidiaries.
 The Company will not, and will not
permit any Subsidiary of the Company to, transfer, convey, sell, lease or
otherwise dispose of any Voting Stock of any Subsidiary or, with respect to a
Subsidiary, to issue any of its Voting Stock (other than, if necessary, shares
of its Voting Stock constituting directors’ qualifying shares) to any Person
except (i) to the Company or a Subsidiary; or (ii) in compliance with
Section 6.4 and immediately after giving effect to such issuance or sale,
such Subsidiary continues to be a Subsidiary. Notwithstanding the foregoing,
the Company may sell all the Voting Stock of a Subsidiary as long as the
Company complies with the terms of Section 6.4.


 


6.9     Merger, Consolidation, etc.  Neither the Company nor any of its Subsidiaries
may merge with or consolidate with any other Person, or sell, transfer, lease
or otherwise dispose of (in one transaction or in a series of transactions) all
or substantially all of its assets or liquidate, wind up or dissolve itself
except that, (i) any Subsidiary may merge into or consolidate with the
Company in a transaction in which the Company is the surviving corporation or
sell or transfer all or substantially all of its assets to the Company (upon
voluntary liquidation or otherwise), (ii) any Subsidiary may merge into or
consolidate with or sell all or substantially all of its assets to, any other
Subsidiary in a transaction in which the surviving entity or transferee is a
Subsidiary and no Person other than the Company or a Subsidiary receives any
consideration, (iii) any Subsidiary may merge with any other Person in
order to effect a Permitted Investment; provided that the continuing or
surviving Person shall be a Subsidiary; (iv) the Company and the
Subsidiaries may consummate the Merger and the Transactions; and (v) a
merger, dissolution, liquidation, consolidation or disposition, the purpose of
which is to effect a disposition in compliance with Section 6.4 shall be
permitted.


 


For purposes of this Section 6.9, the sale, lease, conveyance,
assignment, transfer, or other disposition of all or substantially all of the
properties and assets of one or more Subsidiaries of the Company, which
properties and assets, if held by the Company instead of such Subsidiaries,
would constitute all or substantially all of the properties and assets of the
Company on a consolidated basis, shall be deemed to be the transfer of all or
substantially all of the properties and assets of the Company.


 


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6.10   Limitation on Lines of Business.
 Company shall not, and shall not permit
any Subsidiary to, engage in any business other than a Related Business.


 


6.11   Limitation on Sale/Leaseback and Aircraft Lease Transactions.  Company shall not, and shall not permit any
Subsidiary to, enter into any Sale/Leaseback Transaction or Aircraft Lease
Transaction unless: (i) in the case of a Sale/Leaseback Transaction, the
Company or such Subsidiary, as the case may be, receives consideration at the
time of such Sale/Leaseback Transaction at least equal to the fair market value
(as evidenced by a resolution of the Board of Directors of the Company) of the
property subject to such transaction; (ii) the Company or such Subsidiary
could have Incurred Indebtedness in an amount equal to the Attributable
Indebtedness in respect of such Sale/Leaseback Transaction or Aircraft Lease
Transaction pursuant to Section 6.1 (it being understood that a
Sale/Leaseback Transaction may constitute Aircraft Acquisition Debt); and (iii) in
the case of a Sale/Leaseback Transaction, such Sale/Leaseback Transaction is
treated as an Asset Disposition and all of the conditions of this Agreement
described under Section 6.4 (including the provisions concerning the
application of Net Available Cash within the time periods set forth therein)
are satisfied with respect to such Sale/Leaseback Transaction, treating all of
the consideration received in such Sale/Leaseback Transaction as Net Available
Cash for purposes of such Section 6.4.


 


6.12   Payments for Consent.
 Company shall not, and shall not permit
any of its Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Lender for or as an inducement to
any consent, waiver or amendment of any of the terms or provisions of this
Agreement or the Loans unless such consideration is offered to be paid and is
paid to all Lenders that consent, waive or agree to amend in the time frame set
forth in the solicitation documents relating to such consent, waiver or agreement.


 


SECTION 7. EVENTS OF
DEFAULT


 


Except as modified on the Initial Maturity
Date as set forth in Section 9.1, if any of the following events shall
occur and be continuing:


 


(a)   default in the
payment of any principal of any Loan when due in accordance with the terms
hereof, or the failure to redeem, prepay or purchase Loans when required
pursuant to this Agreement or any Note; or the failure to pay any interest on
any Loan, or any other amount payable hereunder, within five days after any
such interest or other amount becomes due in accordance with the terms hereof;
or


 


(b)   any
representation or warranty made or deemed made by the Company or any Guarantor
herein or in any other Loan Document or which is contained in any certificate,
document, or financial or other statement furnished by it at any time under or
in connection with this Agreement or any such other Loan Document shall prove
to have been incorrect in any material respect on or as of the date made or
deemed made; or


 


(c)   the Company shall
default in the observance or performance of any agreement contained in Section 5.9(a),
5.9(b) or 5.10 or Section 6; or


 


(d)   the Company or
any Guarantor shall default in the observance or performance of any other
agreement contained in this Agreement or the Guarantee and  Collateral Agreement (other than as provided
in paragraphs (a) through (c) of this Section 7), and such
default shall continue unremedied for a period of 30 days after notice to the
Company from the Administrative Agent or the Required Lenders; or


 


65

















 


(e)   default under
any mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness for money borrowed by
the Company or any of its Subsidiaries (or the payment of which is guaranteed
by the Company or any of its Subsidiaries), other than Indebtedness owed to the
Company or a Subsidiary, whether such Indebtedness or guarantee now exists, or
is created after the date of this Agreement, which default (i) is caused
by a failure to pay principal of, or premium, if any, or interest on, such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness unless being contested in good faith by appropriate proceedings (“Payment Default”) or (ii) has
resulted in the acceleration of such Indebtedness prior to its maturity and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$10,000,000 or more; or


 


(f)   (i) the
Company, any Significant Subsidiary or group of Subsidiaries that, taken
together (as of the latest audited financial statements for the Company and its
Subsidiaries), would constitute a Significant Subsidiary, shall commence any
case, proceeding or other action (A) under any existing or future law of
any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief
entered with respect to it or them, or seeking to adjudicate it or them a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or them or its or their debts, or (B) seeking appointment of a
receiver, trustee, custodian, conservator or other similar official for it or
them or for all or any substantial part of its or their assets, or the Company,
any Significant Subsidiary or group of Subsidiaries that, taken together (as of
the latest audited financial statements for the Company and its Subsidiaries),
would constitute a Significant Subsidiary, shall make a general assignment for
the benefit of its or their creditors; or (ii) there shall be commenced
against the Company, any Significant Subsidiary or group of Subsidiaries that,
taken together (as of the latest audited financial statements for the Company
and its Subsidiaries), would constitute a Significant Subsidiary, any case,
proceeding or other action of a nature referred to in clause (i) above
which  (A) results
in the entry of an order for relief or any such adjudication or appointment or  (B) remains
undismissed, undischarged or unbonded for a period of 60 days; or (iii) there
shall be commenced against the Company, any Significant Subsidiary or group of
Subsidiaries that, taken together (as of the latest audited financial
statements for the Company and its Subsidiaries), would constitute a
Significant Subsidiary, any case, proceeding or other action seeking issuance
of a warrant of attachment, execution, distraint or similar process against all
or any substantial part of its or their assets which results in the entry of an
order for any such relief which shall not have been vacated, discharged, or
stayed or bonded pending appeal within 60 days from the entry thereof; or (iv) the
Company, any Significant Subsidiary or group of Subsidiaries that, taken
together (as of the latest audited financial statements for the Company and its
Subsidiaries), would constitute a Significant Subsidiary, shall take any
corporate action in furtherance of, or indicating its or their consent to,
approval of, or acquiescence in, any of the acts set forth in clause (i), (ii),
or (iii) above; or (v) the Company, any Significant Subsidiary or
group of Subsidiaries that, taken together (as of the latest audited financial
statements for the Company and its Subsidiaries), would constitute a
Significant Subsidiary, shall be generally unable to, or shall admit in writing
its or their inability generally to, pay its or their debts as they become due;
or


 


(g)   one or more
judgments or decrees not fully paid or covered by insurance or indemnity
agreements shall be entered against the Company, any Significant Subsidiary or
group of Subsidiaries that, taken together (as of the latest audited financial
statements for the Company and its Subsidiaries), would constitute a
Significant Subsidiary, involving in the aggregate at any


 


66

















 


time a liability (net of any
insurance or indemnity payments actually received in respect thereof prior to
or within 60 days from the entry thereof, or to be received in respect thereof
in the event any appeal thereof shall be unsuccessful) of $10,000,000 or more,
and all such judgments or decrees shall not have been vacated, discharged,
stayed or bonded pending appeal within 60 days from the entry thereof; or


 


(h)   the Guarantee
under the Guarantee and Collateral Agreement of any Significant Subsidiary or
group of Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Subsidiaries), would
constitute a Significant Subsidiary, or any Security Document, ceases to be in
full force and effect (except as contemplated by the terms of this Agreement)
or is declared null and void in a judicial proceeding or any of the Company or
any Subsidiary Guarantor denies or disaffirms its obligations under this
Agreement or any other Loan Document to which it is a party; or


 


(i)   with respect
to any Collateral having a fair market value in excess of $10,000,000,
individually or in the aggregate, (A) the security interest under the
Security Documents, at any time, ceases to be in full force and effect for any
reason other than in accordance with their terms and the terms of this
Agreement and other than the satisfaction in full of all obligations secured
thereby (other than as a result of any action or inaction on the part of the
Administrative Agent), (B) the security interest created under the
Guarantee and Collateral is declared invalid or unenforceable, provided
that in the event that the security interest under any Real Estate Mortgage is
declared invalid or unenforceable, it shall not be an Event of Default if a
claim is successfully made under the title insurance policy, if any, applicable
to such Real Estate Mortgage, and the Administrative Agent receives the
proceeds therefrom in an amount equal to the lesser of the then fair market
value of the property then subject to such Real Estate Mortgage or the maximum
aggregate amount, if any, secured by such Real Estate Mortgage or (C) the
Company or any Subsidiary Guarantor asserts, in any pleading in any court of
competent jurisdiction, that any such security interest is invalid or
unenforceable; or


 


(j)   (i) any
Single Employer Plan shall suffer an “accumulated funding deficiency” (as
defined in Section 412 of the Code or Section 302 of ERISA) or, after
the effectiveness of the Pension Protection Act of 2006, any Single Employer
Plan shall fail to satisfy the minimum funding standard required for any plan
year or part thereof or a waiver of such standard or extension of any
amortization period is sought or granted under Section 412 of the Code; (ii) any
Plan is or shall have been terminated or is the subject of termination
proceedings under Title IV of ERISA, or, after the effectiveness of the Pension
Protection Act of 2006, any Multiemployer Plan is in endangered or critical
status within the meaning of Section 305 of ERISA (including the giving of
written notice thereof); (iii) a trustee shall be appointed by a United
States district court to administer any Single Employer Plan; (iv) the
PBGC shall institute proceedings to terminate any Single Employer Plan; (v) the
Company or any Subsidiary or any Commonly Controlled Entity shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred or will be
assessed liability to such Multiemployer Plan as a result of a complete or
partial withdrawal from such Multiemployer Plan (as such terms are defined in Part I
of Subtitle E of Title IV of ERISA, hereinafter “Withdrawal Liability”) and
such entity does not have reasonable grounds for contesting such Withdrawal
Liability or is not contesting such Withdrawal Liability in a timely and
appropriate manner; or (v) the Company, any Subsidiary or any Commonly
Controlled Entity shall engage in any “prohibited transaction” (as defined in Section 406
of ERISA or Section 4975 of the Code) involving any Single Employer Plan;
and in each case in clauses (i) through (v) above, such event or
condition, together with all such events or conditions, if any could reasonably
be expected to have a Material Adverse Effect; or


 


67

















 


(k)   Holdings or
IntermediateCo shall (i) conduct, transact or otherwise engage in, or
commit to conduct, transact or otherwise engage in, any business or operations
other than those incidental to (w) its ownership of the Capital Stock of
IntermediateCo or the Company, as the case may be, and the management of the
business of, and the provision of services to, IntermediateCo or the Company,
as the case may be, and its Subsidiaries, (x) maintenance of its legal
existence and compliance with applicable Laws, (y) the performance of the
Loan Documents, documents in respect of Take-Out Debt, and documents governing
the terms of its Capital Stock or entered into with the holders of its Capital
Stock with respect thereto and (z) any offerings of its Capital Stock, (ii) incur,
create, assume or suffer to exist any Indebtedness or other financial
obligations, except (1) nonconsensual obligations and immaterial
obligations, (2) obligations pursuant to the Loan Documents to which it is
a party, (3) obligations in connection with the Take-Out Debt, (4) obligations
with respect to its Capital Stock and, (5) obligations related to its
existence and permitted business and activities specified in this clause (k),
or (iii) own, lease, manage or otherwise operate any properties or assets
other than the ownership of shares of Capital Stock of, and management of the
business of, and the provision of services to, IntermediateCo or the Company,
as the case may be, cash and cash equivalents and de minimis amounts of other
assets incidental to the conduct of its business,


 


then,
and in any such event, (A) if such event is an Event of Default specified
in clause (i), (ii) or (iii) of paragraph (f) of this Section with respect to
the Company, the Loans (with accrued interest thereon) and all other amounts
owing under this Agreement shall immediately become due and payable, and (B) if
such event is any other Event of Default, with the consent of the Required
Lenders, the Administrative Agent may, or upon the request of the Required
Lenders, the Administrative Agent shall, by notice to the Company declare the
Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement to be due and payable forthwith, whereupon the same shall
immediately become due and payable. Except as expressly provided above in this
Section, presentment, demand, protest and all other notices of any kind are
hereby expressly waived.


 


SECTION 8. THE AGENTS


 


8.1   Appointment.  Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Loan Documents, and each such Lender irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Administrative
Agent.


 


8.2   Delegation of Duties.  The Administrative Agent may execute any of
its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties.  The Administrative Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care.


 


8.3   Exculpatory Provisions.  Neither any Agent nor any of its officers, directors,
employees, agents, advisors, attorneys-in-fact or affiliates shall be (a) liable
for any action lawfully taken or omitted to be taken by it or such Person under
or in connection with this Agreement or any other Loan


 


68

















 


Document (except to the extent that any of the
foregoing are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from its or such Person’s own gross
negligence or willful misconduct) or (b) responsible in any manner to any
of the Lenders for any recitals, statements, representations or warranties made
by any Loan Party or any officer thereof contained in this Agreement or any
other Loan Document or in any certificate, report, statement or other document
referred to or provided for in, or received by the Agents under or in
connection with, this Agreement or any other Loan Document or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document or for any failure of any Loan Party a
party thereto to perform its obligations hereunder or thereunder. The Agents
shall not be under any obligation to any Lender to ascertain or to inquire as
to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of any Loan Party.


 


8.4   Reliance by Administrative Agent.  The Administrative Agent shall be entitled to
rely, and shall be fully protected in relying, upon any instrument, writing,
resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or
teletype message, statement, order or other document or conversation believed
by it to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Company), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Loans as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take
any action under this Agreement or any other Loan Document unless it shall
first receive such advice or concurrence of the Required Lenders (or, if so
specified by this Agreement, all Lenders) as it deems appropriate or it shall
first be indemnified to its satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Administrative Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this
Agreement and the other Loan Documents in accordance with a request of the
Required Lenders (or, if so specified by this Agreement, all Lenders), and such
request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders and all future holders of the Loans.


 


8.5   Notice of Default.  The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
the Company referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a “notice
of default”.  In the event
that the Administrative Agent receives such a notice, the Administrative Agent
shall give notice thereof to the Lenders. 
The Administrative Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed by the Required
Lenders (or, if so specified by this Agreement, all Lenders); provided
that unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Default
or Event of Default as it shall deem advisable in the best interests of the
Lenders.


 


8.6   Non-Reliance on Agents and Other Lenders.  Each Lender expressly acknowledges that
neither the Agents nor any of their respective officers, directors, employees,
agents, advisors, attorneys-in-fact or affiliates has made any representations
or warranties to it and that no act by any Agent hereinafter taken, including
any review of the affairs of any Loan Party or any affiliate of any Loan Party,
shall be deemed to constitute any representation or warranty by such Agent to
any Lender.  Each Lender represents to
the Agents that it has, independently and without reliance upon any Agent or
any other Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and


 


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creditworthiness
of the Loan Parties and their affiliates and made its own decision to make its
Loans hereunder and enter into this Agreement. 
Each Lender also represents that it will, independently and without
reliance upon any Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and
their affiliates.  Except for notices,
reports and other documents expressly required to be furnished to the Lenders
by the Administrative Agent hereunder, the Administrative Agent shall not have
any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of any Loan Party or any affiliate
of any Loan Party which may come into the possession of the Administrative
Agent or any of its officers, directors, employees, agents, advisors,
attorneys-in-fact or affiliates.


 


8.7   Indemnification.  The Lenders agree to indemnify each Agent and
its officers, directors, employees, affiliates, agents, advisors and
controlling persons (each, an “Agent
Indemnitee”) (to the extent not reimbursed by the Company and
without limiting the obligation of the Company to do so), ratably according to
their respective Commitment Percentages in effect on the date on which
indemnification is sought under this Section 8.7 (or, if indemnification
is sought after the date upon which the Commitments shall have terminated and
the Loans shall have been paid in full, ratably in accordance with their
Commitment Percentages immediately prior to such date), from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind whatsoever which
may at any time (whether before or after the payment of the Loans) be imposed
on, incurred by or asserted against such Agent Indemnitee in any way relating
to or arising out of, the Commitments, this Agreement, any of the other Loan
Documents or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or any action taken or omitted
by such Agent Indemnitee under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements which are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from such Agent Indemnitee’s gross negligence or willful misconduct.  The agreements in this Section shall
survive the payment of the Loans and all other amounts payable hereunder.


 


8.8   Agent in Its Individual Capacity.  Each Agent and its affiliates may make loans
to, accept deposits from and generally engage in any kind of business with any
Loan Party as though such Agent were not an Agent hereunder.  With respect to the Loans made or renewed by
it, each Agent shall have the same rights and powers under this Agreement and
the other Loan Documents as any Lender and may exercise the same as though it
were not an Agent, and the terms “Lender”
and “Lenders” shall include each
Agent in its individual capacity.


 


8.9   Successor Administrative Agent.  The Administrative Agent may resign as
Administrative Agent upon thirty (30) days’ notice to the Lenders and the
Company. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Required Lenders shall
appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 7(a) or
Section 7(f) with respect to the Company shall have occurred and be continuing)
be subject to the approval of the Company (which approval shall not be
unreasonably withheld or delayed), whereupon such successor agent shall succeed
to the rights, powers and duties of the Administrative Agent, and the term “Administrative Agent” shall mean such
successor agent effective upon such appointment and approval, and the former
Administrative Agent’s rights, powers and duties as Administrative Agent shall
be terminated, without any other or further act or deed on the part of such former
Administrative Agent or any of the parties to


 


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this Agreement or any holders of the Loans. If no
successor agent has accepted appointment as Administrative Agent by the date
that is 30 days following a retiring Administrative Agent’s notice of
resignation, the retiring Administrative Agent’s resignation shall nevertheless
thereupon become effective and the Lenders shall assume and perform all of the
duties of the Administrative Agent hereunder until such time, if any, as the
Required Lenders appoint a successor agent as provided for above. After any
retiring Administrative Agent’s resignation as Administrative Agent, the
provisions of this Section 9 and of Section 9.5 shall continue to
inure to its benefit.


 


8.10   Documentation Agent.  The Documentation Agent shall not have any
duties or responsibilities hereunder in its capacity as such.


 


SECTION 9. MISCELLANEOUS


 


9.1   Amendments and Waivers.  (a) Neither this Agreement nor any other
Loan Document, nor any terms hereof or thereof, may be amended, supplemented or
modified except in accordance with the provisions of this Section 9.1. The
Required Lenders and each Loan Party party to the relevant Loan Document may,
or, with the written consent of the Required Lenders, the Administrative Agent
and each Loan Party party to the relevant Loan Document may, from time to time,  (a) enter
into written amendments, supplements or modifications hereto and to the other
Loan Documents for the purpose of adding any provisions to this Agreement or
the other Loan Documents or changing in any manner the rights of the Lenders or
of the Loan Parties hereunder or thereunder or (b) waive, on such terms
and conditions as the Required Lenders or the Administrative Agent, as the case
may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and
its consequences; provided, however,
that no such waiver and no such amendment, supplement, or modification shall (i) (A) reduce
the amount or extend the scheduled date of maturity of any Loan or of any
mandatory prepayment thereof, (B) reduce the stated rate of any interest
thereon or fee payable hereunder or extend the scheduled date of any payment
thereof or increase the aggregate amount or extend the expiration date of any
Lender’s Commitment or (C) restrict the right of each Lender to exchange
Term Loans, or Initial Loans on the Initial Maturity Date, for Exchange Notes
or amend the rate of such exchange, in each case without the written consent of
each Lender directly affected thereby, (ii) (A) amend, modify, or
waive any provision of this Section 9.1, (B) reduce the percentage
specified in the definition of Required Lenders, (C) consent to the
assignment or transfer by the Company of any of its rights and obligations
under the Loan Documents except as expressly permitted hereby, (D) amend,
modify or waive any provision in the Exchange Notes that requires (or would, if
any Exchange Notes were outstanding, require) the approval of all holders of
Exchange Notes, in each case without the consent of all of the Lenders or (E) release
all or substantially all of the Collateral or release all or substantially all
of the Guarantors from their obligations under the Guarantee and Collateral
Agreement, other than in accordance with the terms thereof, in each case,
without the consent of all Lenders, or (iii) amend, modify or waive any
provision of Section 9 without the written consent of the then
Administrative Agent. Any such waiver and any such amendment, supplement or
modification shall apply equally to each of the Lenders and shall be binding
upon the Company and the other Loan Parties, the Lenders, the Administrative
Agent, and all future holders of the Loans. 
In the case of any waiver, the Company and the other Loan Parties, the
Lenders and the Administrative Agent shall be restored to their former
positions and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; no such waiver shall extend to any subsequent or other Default or
Event of Default or impair any right consequent thereon.


 


(b)   In connection
with any proposed amendment, modification, waiver or termination (a “Proposed Change”) requiring the consent of
all Lenders or all affected Lenders, if the consent of the Required Lenders to
such Proposed Change is obtained, but the consent to such Proposed Change of
other Lenders whose consent is required is not obtained (any such Lender whose
consent is not obtained as


 


71

















 


described in paragraph (a) of this Section being
referred to as a “Non-Consenting Lender”),
then, so long as the Lender that is acting as Administrative Agent is not a
Non-Consenting Lender, the Company may, at its sole expense and effort, upon
notice to such Non-Consenting Lender and the Administrative Agent, require such
Non-Consenting Lender to assign and delegate, without recourse (in accordance
with and subject to the restrictions contained in Section 9.6), all its
interests, rights and obligations under this Agreement to an assignee that
shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment), provided that
(a) the Company shall have received the prior written consent of the
Administrative Agent, which consent shall not unreasonably be withheld, (b) such
Non-Consenting Lender shall have received payment of an amount equal to the
outstanding principal of its Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Company (in
the case of all other amounts) and (c) the Company or such assignee shall
have paid to the Administrative Agent the processing and recordation fee
specified in Section 9.6.


 


(c) Notwithstanding anything
in clause (a) above or in this Agreement and the other Loan Documents to
the contrary, without notice to or the consent of any Lender, the
Administrative Agent or the Company, immediately following the Initial Maturity
Date:


 


(i) the affirmative covenants
set forth in Section5 (other than (A) Section 5.10 (Exchange Notes)
and (B) for so long as any Loans are outstanding, Section 5.1
(Financial Statements), Section 5.2 (Certificates; Other Information), Section 5.12
(Additional Collateral) and Section 5.14 (Further Assurances)) shall be
deemed deleted;


 


(ii) the negative covenants
set forth in Section6 shall be deemed to have been automatically replaced by
the corresponding covenants set forth in the Description of Exchange Notes; provided that the covenant corresponding
to Section 6.7 (Change of Control) shall continue to apply with respect to
outstanding Term Loans with such appropriate changes to conform to the “Change
of Control” provision of the Indenture, and


 


(iii) the Events of Default and remedies set
forth in Section7 shall be deemed to have been automatically replaced by the defaults and remedies described in the Description of
Exchange Notes under the heading “Events of Default,”


 


each
as applicable, which replacement provisions, along with the relevant defined
terms used therein for the purposes thereof, will thereupon be deemed
incorporated by reference herein, with references therein to the “Issuer” and
the “Trustee” being deemed to be references to the “Company” and the “Administrative
Agent,” respectively, and with such other modifications to this Agreement
necessary to give effect to the foregoing; in furtherance of the foregoing, the
Administrative Agent will, at the request of the Company, enter into such
technical amendments to the Loan Documents reasonably necessary to effect the
foregoing and to secure the Exchange Notes with the Collateral ratably with the
Loans; provided that following the Initial Maturity Date, (i) the
proceeds of any mandatory prepayment event set forth in Section 2.5 shall
continue to be applied in accordance with Section 2.5, and (ii) the
Collateral securing the Exchange Notes shall be subject to the limitations
described in Exhibit B with respect to the exclusion from Collateral of
Capital Stock of a Subsidiary to the extent inclusion would require Holdings or
the Company to file with the SEC separate financial statements of such
Subsidiary.


 


9.2   Notices.  All notices,
requests and demands to or upon the respective parties hereto to be effective
shall be in writing (including by telecopy), and, unless otherwise expressly
provided herein, shall be deemed to have been duly given or made when
delivered, or three Business Days after being deposited in the mail, postage
prepaid, or, in the case of telecopy notice, when received, addressed as
follows in the case of the Company and the Administrative Agent, and as set forth
in an administrative


 


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questionnaire delivered to the Administrative Agent
in the case of the Lenders, or to such other address as may be hereafter
notified by the respective parties hereto:


 


Company:                                                                                                               New ATA
Acquisition Inc.

7337 West Washington Street

Indianapolis, IN 46231

Attention:  General Counsel

Telecopy:   (317) 282-7091

Telephone: (317) 282-7006


 


Administrative Agent:                                              JPMorgan Chase
Bank, N.A.

1111 Fannin Street, Floor 10

Houston, TX 77002-6925

Attention:   Daniel Blazei

Telecopy:   (713) 750-2938

Telephone: (713) 750-7924


 


provided that any
notice, request or demand to or upon the Administrative Agent or the Lenders
shall not be effective until received.


 


Notices and other communications to the Lenders
hereunder may be delivered or furnished by electronic communications pursuant
to procedures approved by the Administrative Agent; provided that the
foregoing shall not apply to notices pursuant to Section 2 unless
otherwise agreed by the Administrative Agent and the applicable Lender. The
Administrative Agent or the Company 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.


 


9.3   No Waiver; Cumulative Remedies.  No failure to exercise and no delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
remedy, power or privilege hereunder or under the other Loan Documents 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.


 


9.4   Survival of Representations and Warranties.  All representations and warranties made
hereunder, in the other Loan Documents and in any document, certificate or
statement delivered pursuant hereto or in connection herewith shall survive the
execution and delivery of this Agreement and the making of the Loans hereunder.


 


9.5   Payment of Expenses
and Taxes.  The Company agrees
(a) to pay or reimburse the Administrative Agent for all its reasonable
and documented out-of-pocket costs and expenses incurred in connection with the
development, preparation and execution of, and any amendment, supplement or
modification to, this Agreement and the other Loan Documents and any other
documents prepared in connection herewith or therewith, and the consummation
and administration of the transactions contemplated hereby and thereby,
including the reasonable fees and disbursements of counsel to the
Administrative Agent and filing and recording fees and expenses, with
statements with respect to the foregoing to be submitted to the Company prior
to the Closing Date (in the case of amounts to be paid on the Closing Date) and
from time to time thereafter on a quarterly basis or such other periodic basis
as the Administrative Agent shall deem appropriate; provided that the
Company shall not be liable for any costs


 


73

















 


and expenses described in this clause (a) in
the event that the funding of the Initial Loans does not occur on the Closing
Date, (b) to pay or reimburse each Lender and the Administrative Agent for
all its reasonable and documented out-of-pocket costs and expenses incurred in
connection with the enforcement or preservation of any rights under this
Agreement, the other Loan Documents and any such other documents, including the
fees and disbursements of counsel to each Lender and of counsel to the
Administrative Agent, (c) to pay, indemnify, and hold each Lender and the
Administrative Agent harmless from, any and all recording and filing fees and
any and all liabilities with respect to, or resulting from any delay in paying,
stamp, excise and other taxes, if any, that may be payable or determined to be
payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents, and (d) to
pay, indemnify, and hold each Lender and the Administrative Agent and their
respective officers, directors, employees, affiliates, agents, advisors and
controlling persons (each, an “Indemnitee”) harmless from and against any and
all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits and related reasonable out-of-pocket costs, expenses or disbursements
of any kind or nature whatsoever arising out of this Agreement, the other Loan
Documents and any such other documents, including any of the foregoing relating
to the use of proceeds of the Loans or the violation of, noncompliance with or
liability under, any Environmental Law applicable to the operations of any
Group Member or any of the Properties and the reasonable fees and expenses of
legal counsel in connection with claims, actions or proceedings by any
Indemnitee against any Loan Party under any Loan Document (all the foregoing in
this clause (d), collectively, the “Indemnified Liabilities”), provided,
that the Company shall have no obligation hereunder to any Indemnitee with
respect to Indemnified Liabilities to the extent such Indemnified Liabilities
are found by a final and nonappealable decision of a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct
of such Indemnitee.  Without limiting the
foregoing, and to the extent permitted by applicable law, the Company agrees
not to assert and to cause its Subsidiaries not to assert, and hereby waives
and agrees to cause its Subsidiaries to waive, rights for contribution or any
other rights of recovery with respect to all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or
nature, under or related to Environmental Laws, that any of them might have by
statute or otherwise against any Indemnitee. 
All amounts due under this Section 9.5 shall be payable not later
than 10 days after written demand therefor. 
Statements payable by the Company pursuant to this Section 9.5
shall be submitted to the General Counsel (Telephone No. (317) 282-7006)
(Telecopy No. (317) 282-7091), at the address of the Company set forth in Section 9.2,
or to such other Person or address as may be hereafter designated by the
Company in a written notice to the Administrative Agent. The agreements in this
Section 9.5 shall survive repayment of the Loans and all other amounts
payable hereunder.


 


9.6   Successors and Assigns; Participations and Assignments.  (a) The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that (i) the
Company may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Company without such consent shall be null and
void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section.


 


(b)   (i) Subject to the
conditions set forth in paragraph (b)(ii) below, any Lender may assign to
one or more assignees (each, an “Assignee”)
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Loans at the time owing to it) with the prior written
consent of the Administrative Agent, provided that no consent of the
Administrative Agent shall be required of all or any portion of any Loan to a
Lender, an affiliate of a Lender or an Approved Fund.


 


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


 


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(A)   except in the case
of an assignment to a Lender, an affiliate of a Lender or an Approved Fund or
an assignment of the entire remaining amount of the assigning Lender’s
Commitments or Loans under any Facility, the amount of the Commitments or Loans
of the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Assumption with respect to such assignment is delivered
to the Administrative Agent) shall not be less than $5,000,000 unless the
Administrative Agent otherwise consents, provided that such amounts
shall be aggregated in respect of each Lender and its affiliates or Approved
Funds, if any;


 


(B)   (1) the
parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation
fee of $3,500 and (2) the assigning Lender shall have paid in full any
amounts owing by it to the Administrative Agent; and


 


(C)   the Assignee,
if it shall not be a Lender, shall deliver to the Administrative Agent an
administrative questionnaire in which the Assignee designates one or more
credit contacts to whom all syndicate-level information (which may contain
material non-public information about the Company and its Affiliates and their
related parties or their respective securities) will be made available and who
may receive such information in accordance with the assignee’s compliance
procedures and applicable laws, including Federal and state securities laws.


 


For the purposes of this Section 9.6, “Approved Fund” means any Person (other than a natural
person) that is engaged in making, purchasing, holding or investing in bank
loans and similar extensions of credit in the ordinary course of its business
and that is administered or managed by (a) a Lender, (b) an affiliate
of a Lender or (c) an entity or an affiliate of an entity that administers
or manages a Lender.


 


(ii)   Subject to acceptance and
recording thereof pursuant to paragraph (b)(iv) below, from and after the
effective date specified in each Assignment and Assumption the Assignee
thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.9, 2.10, 2.11 and 9.5). 
Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this Section 9.6 shall be treated
for purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with paragraph (c) of this
Section.


 


(iii)   The
Administrative Agent, acting for this purpose as an agent of the Company, shall
maintain at one of its offices a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and addresses
of the Lenders, and the Commitments of, and principal amount of the Loans owing
to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Company, the Administrative Agent, the Issuing Lender 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.


 


75

















 


(iv)   Upon its receipt of a duly completed Assignment
and Assumption executed by an assigning Lender and an Assignee, the Assignee’s
completed administrative questionnaire (unless the Assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by
paragraph (b) of this Section, the Administrative Agent shall accept such
Assignment and Assumption and record the information contained therein in the
Register. No assignment shall be effective for purposes of this Agreement unless
it has been recorded in the Register as provided in this paragraph.


 


(c)  (i)  Any Lender may, without
the consent of the Company or the Administrative Agent, sell participations to
one or more banks or other entities (a “Participant”)
in all or a portion of such Lender’s rights and obligations under this
Agreement (including all or a portion of its Commitments and the Loans owing to
it); provided that (A) such Lender’s obligations under this
Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Company, the Administrative Agent, the Issuing Lender and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement.  Any agreement 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
may provide that such Lender will not, without the consent of the Participant,
agree to any amendment, modification or waiver that (1) requires the
consent of each Lender directly affected thereby pursuant to the proviso to the
second sentence of Section 9.1 and (2) directly affects such
Participant. Subject to paragraph (c)(ii) of this Section, the Company
agrees that each Participant shall be entitled to the benefits of Sections 2.9,
2.10 and 2.11 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this Section.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 9.7(b) as
though it were a Lender, provided such Participant shall be subject to Section 9.7(a) as
though it were a Lender.


 


(ii)   A Participant shall not be entitled to receive
any greater payment under Section 2.9 or 2.10 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 Company’s prior written consent. 
Any Participant that is a Non-U.S. Lender shall not be entitled to the
benefits of Section 2.10 unless such Participant complies with Section 2.10(d).


 


(d)   Any Lender may at any time pledge
or assign a security interest in all or any portion of its rights under this
Agreement to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank, and this Section shall
not apply to any such pledge or assignment of a security interest; provided
that no such pledge or assignment of a security interest shall release a Lender
from any of its obligations hereunder or substitute any such pledgee or
Assignee for such Lender as a party hereto. The Company, upon receipt of
written notice from the relevant Lender, agrees to issue Notes to any Lender
requiring Notes to facilitate transactions of the type described in this
paragraph (d).


 


 (e)  (i)  To the extent
requested by any Lender, the Company shall execute and deliver to such Lender
an Initial Note dated the Closing Date substantially in the form of Exhibit I-1 hereto to evidence the
portion of the Initial Loan made by such Lender and with appropriate insertions
(“Original Initial Notes”).  On
each Interest Payment Date prior to the Cash Pay Date, to the extent requested
by any Lender, the Company shall execute and deliver to such Lender on such
Interest Payment Date a note dated such Interest Payment Date substantially in
the form of Exhibit I-1 hereto
in a principal amount equal to such Lender’s pro
rata portion of the PIK Interest Amount and with other appropriate
insertions


 


76

















 


(each a “Subsequent
Initial Note” and, together with the Original Initial Notes, the “Initial Notes”). A Subsequent Initial Note
shall bear interest from the date of its issuance at the same rate borne by all
Initial Notes at the date of issuance and from time to time thereafter.


 


(ii)   Unless converted to an Exchange Note and, to the
extent requested by any Lender, the Company shall execute and deliver to such
Lender a Term Note dated the Initial Maturity Date substantially in the form of
Exhibit I-2 hereto to
evidence the Term Loan made on such date, in the principal amount of the
Initial Notes held by such Lender on such date and with other appropriate
insertions (collectively, the “Original Term
Notes”).  On or after the
Initial Maturity Date, on each Interest Payment Date prior to the Cash Pay
Date, to the extent requested by any Lender, the Company shall execute and
deliver to such Lender on such Interest Payment Date a Term Note dated such
Interest Payment Date substantially in the form of Exhibit I-2 hereto in a principal amount equal to such
Lender’s pro rata portion of the
PIK Interest Amount and with other appropriate insertions (each a “Subsequent Term Note” and, together with
the Original Term Notes, the “Term Notes”).  A Subsequent Term Note shall bear interest
from the date of its issuance at the same rate borne by all Term Notes at the
date of issuance and from time to time thereafter.


 


(iii)   On or prior to the effective date of any Assignment
and Assumption, the assigning Lender shall surrender any outstanding Loan Notes
held by it all or a portion of which are being assigned, and the Company, at
its own expense, shall, upon a request to the Administrative Agent by the
assigning Lender or the Assignee, as applicable, execute and deliver to the
Administrative Agent (in exchange for outstanding Loan Notes of the assigning
Lender, if any) a new Loan Note to the order of such Assignee in an amount
equal to the amount of such Assignee’s Loans after giving effect to such
Assignment and Acceptance and, if the assigning Lender has retained a Loan
hereunder, a new Loan Note, to the order of the assigning Lender in an amount
equal to the amount of such Lender’s Loans after giving effect to such Assignment
and Acceptance. Any such new Loan Notes shall be dated the Closing Date and
shall otherwise be in the form of the Loan Note replaced thereby.  Any Loan Notes surrendered by the assigning
Lender shall be returned by the Administrative Agent to the Company marked “cancelled”.


 


9.7   Adjustments; Set-off.  (a) Except to the extent that this
Agreement, any other Loan Document or a court order expressly provides for
payments to be allocated to a particular Lender or to the Lenders, if any
Lender (a “Benefitted Lender”)
shall at any time receive any payment of all or part of its Loans or interest
thereon (other than in connection with an assignment made pursuant to Section 9.6),
or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of the nature
referred to in Section 7(f), or otherwise), in a greater proportion than
any such payment to or collateral received by any other Lender, if any, in
respect of such other Lender’s Loans or interest thereon, such Benefitted
Lender shall purchase for cash from the other Lenders a participating interest
in such portion of each such other Lender’s Loan, or shall provide such other
Lenders with the benefits of any such collateral, or the proceeds thereof, as
shall be necessary to cause such Benefitted Lender to share the excess payment
or benefits of such collateral or proceeds ratably with each of the Lenders; provided, however, that if all or any
portion of such excess payment or benefits is thereafter recovered from such
Benefitted Lender, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest.


 


(b)  In addition to any rights and
remedies of the Lenders provided by law, each Lender shall have the right,
without prior notice to the Company, any such notice being expressly waived by
the Company to the extent permitted by applicable law, upon any amount becoming
due and payable by the Company hereunder (whether at the stated maturity, by
acceleration or otherwise) to set-off and appropriate and apply against such
amount any and all deposits (general or special, time or demand,


 


77

















 


provisional or final), in any currency, and any other
credits, indebtedness or claims, in any currency, in each case whether direct
or indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Lender or any branch or agency thereof to or for the credit or
the account of the Company. Each Lender agrees promptly to notify the Company
and the Administrative Agent after any such set-off and application made by
such Lender, provided that the failure to give such notice shall not affect the
validity of such set-off and application.


 


9.8   Counterparts.  This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts, and
all of said counterparts taken together shall be deemed to constitute one and
the same instrument. Delivery of an executed signature page of this
Agreement by facsimile or email transmission shall be effective as delivery of
a manually executed counterpart hereof. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Company and the
Administrative Agent.


 


9.9   Severability.  Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.


 


9.10   Integration.  This Agreement and the other Loan Documents represent
the entire agreement of the Company, the Administrative Agent and the Lenders
with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to the subject matter hereof not expressly set
forth or referred to herein or in the other Loan Documents.


 


9.11   GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.


 


9.12   Submission To Jurisdiction; Waivers.  The Company hereby irrevocably and
unconditionally:


 


(a)   submits
for itself and its property in any legal action or proceeding relating to this
Agreement and the other Loan Documents to which it is a party, or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;


 


(b)   consents
that any such action or proceeding may be brought in such courts and waives any
objection that it may now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or proceeding was brought in
an inconvenient court or forum and agrees not to plead or claim the same;


 


(c)   agrees
that service of process in any such action or proceeding may be effected by
mailing a copy thereof by registered or certified mail (or any substantially
similar form of mail), postage prepaid, to the Company, at the address
specified in Section 9.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;


 


(d)   agrees
that nothing herein shall affect the right to effect service of process in any
other manner permitted by law or shall limit the right to sue in any other
jurisdiction; and


 


78

















 


(e)   waives,
to the maximum extent not prohibited by law, any right it may have to claim or
recover in any legal action or proceeding referred to in this Section any
special, exemplary, punitive or consequential damages.


 


9.13  
Acknowledgements.  The Company hereby acknowledges
that:


 


(a)   it
has been advised by counsel in the negotiation, execution and delivery of this
Agreement and the other Loan Documents;


 


(b)   neither
the Administrative Agent nor any Lender has any fiduciary relationship with or
duty to the Company arising out of or in connection with this Agreement or any
of the other Loan Documents, and the relationship between Administrative Agent
and Lenders, on one hand, and the Company, on the other hand, in connection
herewith or therewith is solely that of creditor and debtor; and


 


(c)   no
joint venture is created hereby or by the other Loan Documents or otherwise
exists by virtue of the transactions contemplated hereby among the Lenders or
among the Company and the Lenders.


 


9.14   WAIVERS OF JURY TRIAL.  THE COMPANY, THE ADMINISTRATIVE AGENT AND THE
LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND
FOR ANY COUNTERCLAIM THEREIN.


 


9.15   Confidentiality.  (a) Each of the Administrative Agent and
each Lender agrees to keep confidential all non-public information provided to
it by any Loan Party, the Administrative Agent or any Lender pursuant to or in
connection with this Agreement that is designated by the provider thereof as
confidential; provided that nothing herein shall prevent the
Administrative Agent or any Lender from disclosing any such information (i) to
the Administrative Agent, any other Lender or any affiliate thereof,  (ii) subject
to an agreement for the benefit of the Company to comply with the provisions of
this Section, to any actual or prospective Transferee or any direct or indirect
counterparty to any Currency Agreement or Interest Rate Agreement (or any
professional advisor to such counterparty), (iii) to its employees,
directors, agents, attorneys, accountants and other professional advisors or
those of any of its affiliates (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 pursuant to
the terms hereof), (iv) upon the request or demand of any Governmental
Authority, (v) in response to any order of any court or other Governmental
Authority or as may otherwise be required pursuant to any Requirement of Law, (vi) if
requested or required to do so in connection with any litigation or similar
proceeding, (vii) that has been publicly disclosed other than as a result,
to the knowledge of the Administrative Agent or such Lender, of a breach of
this Section 9.15, (viii) to the National Association of Insurance
Commissioners or any similar organization or any nationally recognized rating
agency that requires access to information about a Lender’s investment portfolio
in connection with ratings issued with respect to such Lender (it being
understood that, prior to any such disclosure, such rating agency shall
undertake to preserve the confidentiality of any information relating to the
Loan Parties received by it from such Lender), or (ix) in connection with
the exercise of any remedy hereunder or under any other Loan Document.


 


(b)   Each
Lender acknowledges that information furnished to it pursuant to this Agreement
or the other Loan Documents may include material non-public information
concerning the Company and its Affiliates and their related parties or their
respective securities, and confirms that it has


 


79

















 


developed compliance procedures regarding the use of material
non-public information and that it will handle such material non-public
information in accordance with those procedures and applicable law, including
Federal and state securities laws.


 


(c)   All
information, including requests for waivers and amendments, furnished by the
Company or the Administrative Agent pursuant to, or in the course of
administering, this Agreement or the other Loan Documents will be
syndicate-level information, which may contain material non-public information
about the Company and its Affiliates and their related parties or their
respective securities. Accordingly, each Lender represents to the Company and
the Administrative Agent that it has identified in its administrative
questionnaire a credit contact who may receive information that may contain
material non-public information in accordance with its compliance procedures
and applicable law, including Federal and state securities laws.


 


9.16   Releases of Guarantees and Liens.  (a) Notwithstanding anything to the
contrary contained herein or in any other Loan Document, the Administrative
Agent is hereby irrevocably authorized by each Lender (without requirement of
notice to or consent of any Lender except as expressly required by Section 9.1)
to take any action requested by the Company having the effect of releasing any
Collateral or guarantee obligations (i) to the extent necessary to permit
consummation of any transaction not prohibited by any Loan Document or that has
been consented to in accordance with Section 9.1 or (ii) under the
circumstances described in paragraph (b) below.


 


(b)   At such time
as the Loans and the other obligations under the Loan Documents (other than
obligations under or in respect of any Currency Agreement or Interest Rate
Agreement and contingent reimbursement and indemnification obligations not yet
accrued and payable) shall have been paid in full, the Collateral shall be
released from the Liens created by the Security Documents, and the Security
Documents and all obligations (other than those expressly stated to survive
such termination) of the Administrative Agent and each Loan Party under the
Security Documents shall terminate, all without delivery of any instrument or
performance of any act by any Person.


 


(c)   The Lenders
irrevocably agree:


 


(i) that any Lien on any
property granted to or held by the Administrative Agent under any Loan Document
shall be automatically released (x) at the time the property subject to
such Lien is transferred or to be transferred as part of or in connection with
any transfer permitted hereunder or under any other Loan Document to any Person
other than a Loan Party, (y) if the release of such Lien is approved,
authorized or ratified in writing by the Required Lenders (or such greater
number of Lenders as may be required pursuant to Section 9.1) or (z) if
the property subject to such Lien is owned by a Subsidiary Guarantor, upon
release of such Subsidiary Guarantor from its obligations under its Guarantee
under the Guarantee and Collateral Agreement pursuant to clause (iii) below;


 


(ii) (x) to release or
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 clause (ix) of the definition of Permitted Liens and (y) that
the Administrative Agent is authorized (but not required) to release or
subordinate any Lien on any property granted to or held by the Administrative
Agent under any Loan Document to the holder of any Permitted Lien on such
property; and


 


(iii) that any Subsidiary
Guarantor shall be automatically released from its obligations under the
Guarantee and Collateral Agreement if such Person ceases to be a Subsidiary as
a result of a transaction or designation permitted hereunder.


 


80

















 


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


 


	
   

  	
  NEW ATA ACQUISITION INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Subodh Karnik

  	
   

  
	
   

  	
   

  	
  Name:

  	
    Subodh Karnik

  
	
   

  	
   

  	
  Title:

  	
    President and
  CEO

  
					



 


 


[Signature Page to Term Loan Agreement]


 

















 


 


	
   

  	
  JP MORGAN CHASE BANK,
  N.A., as Administrative

  
	
   

  	
  Agent and as
  a Lender

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John C. Riordan

  	
   

  
	
   

  	
   

  	
  Name:

  	
  JOHN C. RIORDAN

  
	
   

  	
   

  	
  Title: 

  	
  VICE PRESIDENT

  
					



 


 


[Signature Page to Term Loan Agreement]


 

















 


	
   

  	
  JEFFERIES
  FINANCE LLC, as Documentation Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ E.J.Hess

  	
   

  
	
   

  	
   

  	
  Name:

  	
  E.J.Hess

  
	
   

  	
   

  	
  Title:

  	
  Managing Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  JEFFERIES FINANCE CP
  FUNDING LLC, as a 

  
	
   

  	
  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ E.J.Hess

  	
   

  
	
   

  	
   

  	
  Name:

  	
  E.J.Hess

  
	
   

  	
   

  	
  Title:

  	
  Managing Director

  
					



 


 


[Signature Page to Term Loan Agreement]