exv10w21






Exhibit 10.21




EXECUTION VERSION




CREDIT AGREEMENT




Dated as of December 17, 2009




among




NORTEK, INC.,

as the Specified U.S. Borrower,




VENTROL AIR HANDLING SYSTEMS INC.,

as the Canadian Borrower,



The Other Borrowers Named Herein,



BANK OF AMERICA, N.A.,

as Administrative Agent, Collateral Agent, U.S. Swing Line Lender and

U.S. L/C Issuer,



BANK OF AMERICA, N.A. (acting through its Canada branch),

as Canadian Swing Line Lender and

Canadian L/C Issuer,



The Other Lenders Party Hereto,



BANC OF AMERICA SECURITIES LLC,

GE CAPITAL MARKETS, INC.,

and

WELLS FARGO FOOTHILL, LLC

as Joint Lead Arrangers and Joint Bookrunners



and



GENERAL ELECTRIC CAPITAL CORPORATION

AND

WELLS FARGO FOOTHILL, LLC,

AS COLLATERAL AGENTS AND CO-SYNDICATION AGENTS



 









 





TABLE OF CONTENTS




	 	 	 	 	 
	Section	 	Page
	
ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS
	 
	 	 	 	 
	1.01 Defined Terms
	 	 	1	 
	1.02 Other Interpretive Provisions
	 	 	51	 
	1.03 Accounting Terms
	 	 	52	 
	1.04 Rounding
	 	 	52	 
	1.05 Times of Day
	 	 	52	 
	1.06 Timing of Payment or Performance
	 	 	52	 
	1.07 Letter of Credit Amounts
	 	 	52	 
	1.08 Currency Equivalents Generally
	 	 	52	 
	1.09 Collateral Agents
	 	 	53	 
	 
	 	 	 	 
	
ARTICLE II
	THE COMMITMENTS AND CREDIT EXTENSIONS
	 
	 	 	 	 
	2.01 The Loans
	 	 	53	 
	2.02 Borrowings, Conversions and Continuations of Loans
	 	 	59	 
	2.03 Letters of Credit
	 	 	61	 
	2.04 Swing Line Loans
	 	 	67	 
	2.05 Prepayments
	 	 	73	 
	2.06 Termination or Reduction of Commitments
	 	 	77	 
	2.07 Repayment of Loans
	 	 	78	 
	2.08 Interest
	 	 	78	 
	2.09 Fees
	 	 	79	 
	2.10 Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate
	 	 	80	 
	2.11 Evidence of Debt
	 	 	81	 
	2.12 Payments Generally; Administrative Agent’s Clawback
	 	 	81	 
	2.13 Sharing of Payments by Lenders
	 	 	83	 
	2.14 Nature of Obligations
	 	 	84	 
	2.15 Borrower Agent
	 	 	85	 
	2.16 Commitment Increase
	 	 	86	 
	 
	 	 	 	 
	
ARTICLE III
	TAXES, YIELD PROTECTION AND ILLEGALITY
	 
	 	 	 	 
	3.01 Taxes
	 	 	87	 
	3.02 Illegality
	 	 	90	 
	3.03 Inability to Determine Rates
	 	 	91	 
	3.04 Increased Costs; Reserves on Eurodollar Rate Loans
	 	 	91	 
	3.05 Compensation for Losses
	 	 	93	 
	3.06 Mitigation Obligations; Replacement of Lenders
	 	 	93	 
	3.07 Survival
	 	 	94	 






i









 






	 	 	 	 	 
	Section	 	Page
	
ARTICLE IV
	CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
	 
	 	 	 	 
	4.01 Conditions of Initial Credit Extension
	 	 	94	 
	4.02 Conditions to all Credit Extensions
	 	 	100	 
	 
	 	 	 	 
	
ARTICLE V
	REPRESENTATIONS AND WARRANTIES
	 
	 	 	 	 
	5.01 Existence, Qualification and Power; Compliance with Laws
	 	 	101	 
	5.02 Authorization; No Contravention
	 	 	101	 
	5.03 Governmental Authorization; Other Consents
	 	 	102	 
	5.04 Binding Effect
	 	 	102	 
	5.05 Financial Statements; No Material Adverse Effect
	 	 	102	 
	5.06 Litigation
	 	 	103	 
	5.07 No Default
	 	 	103	 
	5.08 Ownership of Property; Liens
	 	 	103	 
	5.09 Environmental Compliance
	 	 	103	 
	5.10 Insurance
	 	 	104	 
	5.11 Taxes
	 	 	104	 
	5.12 ERISA Compliance
	 	 	104	 
	5.13 Subsidiaries; Equity Interests; Loan Parties
	 	 	105	 
	5.14 Margin Regulations; Investment Company Act
	 	 	105	 
	5.15 Disclosure
	 	 	106	 
	5.16 Compliance with Laws
	 	 	106	 
	5.17 Intellectual Property; Licenses, Etc.
	 	 	106	 
	5.18 Solvency
	 	 	106	 
	5.19 Casualty, Etc.
	 	 	106	 
	5.20 Perfection, Etc.
	 	 	107	 
	5.21 [Reserved]
	 	 	107	 
	5.22 Tax Shelter Regulations
	 	 	107	 
	5.23 Anti-Terrorism Law
	 	 	107	 
	5.24 Accounts
	 	 	108	 
	5.25 Canadian Pension Plans
	 	 	109	 
	 
	 	 	 	 
	
ARTICLE VI
	AFFIRMATIVE COVENANTS
	 
	 	 	 	 
	6.01 Financial Statements
	 	 	109	 
	6.02 Certificates; Other Information
	 	 	111	 
	6.03 Notices
	 	 	113	 
	6.04 Payment of Obligations
	 	 	114	 
	6.05 Preservation of Existence, Etc.
	 	 	114	 
	6.06 Maintenance of Properties
	 	 	114	 
	6.07 Maintenance of Insurance
	 	 	114	 
	6.08 Compliance with Laws
	 	 	115	 
	6.09 Books and Records
	 	 	115	 
	6.10 Inspections; Appraisals
	 	 	115	 
	6.11 Use of Proceeds
	 	 	115	 
	6.12 Covenant to Guarantee Obligations and Give Security
	 	 	115	 
	6.13 Compliance with Environmental Laws
	 	 	118	 






ii









 






	 	 	 	 	 
	Section	 	Page
	6.14 Further Assurances
	 	 	119	 
	6.15 Compliance with Terms of Leaseholds
	 	 	119	 
	6.16 [Reserved]
	 	 	119	 
	6.17 Designation as Senior Debt
	 	 	119	 
	6.18 Collateral Administration
	 	 	120	 
	6.19 Maintenance of Cash Management System
	 	 	121	 
	 
	 	 	 	 
	
ARTICLE VII
	NEGATIVE COVENANTS
	 
	 	 	 	 
	7.01 Liens
	 	 	122	 
	7.02 Investments
	 	 	125	 
	7.03 Indebtedness
	 	 	128	 
	7.04 Fundamental Changes
	 	 	131	 
	7.05 Dispositions
	 	 	132	 
	7.06 Restricted Payments
	 	 	133	 
	7.07 Change in Nature of Business
	 	 	135	 
	7.08 Transactions with Affiliates
	 	 	135	 
	7.09 Burdensome Agreements
	 	 	136	 
	7.10 Use of Proceeds
	 	 	137	 
	7.11 Consolidated Fixed Charge Coverage Ratio
	 	 	137	 
	7.12 Amendments of Organization Documents
	 	 	137	 
	7.13 Accounting Changes
	 	 	137	 
	7.14 Prepayments, Etc. of Indebtedness
	 	 	137	 
	7.15 Equity Interests of the Specified U.S. Borrower and Subsidiaries
	 	 	137	 
	7.16 Capital Expenditures
	 	 	138	 
	7.17 Designation of Senior Debt
	 	 	138	 
	7.18 Approved Plan of Reorganization
	 	 	138	 
	 
	 	 	 	 
	
ARTICLE VIII
	EVENTS OF DEFAULT AND REMEDIES
	 
	 	 	 	 
	8.01 Events of Default
	 	 	138	 
	8.02 Remedies upon Event of Default
	 	 	141	 
	8.03 Application of Funds
	 	 	142	 
	8.04 Collection Allocation Mechanism
	 	 	144	 
	 
	 	 	 	 
	
ARTICLE IX
	ADMINISTRATIVE AGENT
	 
	 	 	 	 
	9.01 Appointment and Authority
	 	 	145	 
	9.02 Rights as a Lender
	 	 	146	 
	9.03 Exculpatory Provisions
	 	 	146	 
	9.04 Reliance by Administrative Agent
	 	 	147	 
	9.05 Delegation of Duties
	 	 	147	 
	9.06 Resignation of Administrative Agent
	 	 	148	 
	9.07 Non-Reliance on Administrative Agent and Other Lenders
	 	 	148	 
	9.08 No Other Duties, Etc.
	 	 	149	 
	9.09 Administrative Agent May File Proofs of Claim
	 	 	149	 
	9.10 Collateral and Guaranty Matters
	 	 	149	 
	9.11 Secured Cash Management Agreements and Secured Hedge Agreements
	 	 	150	 






iii









 






	 	 	 	 	 
	Section	 	Page
	
ARTICLE X
	[RESERVED]
	 
	 	 	 	 
	
ARTICLE XI
	MISCELLANEOUS
	 
	 	 	 	 
	11.01 Amendments, Etc.
	 	 	150	 
	11.02 Notices; Effectiveness; Electronic Communications
	 	 	153	 
	11.03 No Waiver; Cumulative Remedies
	 	 	155	 
	11.04 Expenses; Indemnity; Damage Waiver
	 	 	155	 
	11.05 Payments Set Aside
	 	 	157	 
	11.06 Successors and Assigns
	 	 	157	 
	11.07 Treatment of Certain Information; Confidentiality
	 	 	161	 
	11.08 Right of Setoff
	 	 	162	 
	11.09 Interest Rate Limitation
	 	 	163	 
	11.10 Counterparts; Integration; Effectiveness
	 	 	163	 
	11.11 Survival of Representations and Warranties
	 	 	164	 
	11.12 Severability
	 	 	164	 
	11.13 Replacement of Lenders
	 	 	164	 
	11.14 Governing Law; Jurisdiction; Etc.
	 	 	165	 
	11.15 Waiver of Jury Trial
	 	 	165	 
	11.16 No Advisory or Fiduciary Responsibility
	 	 	166	 
	11.17 Electronic Execution of Assignments and Certain Other Documents
	 	 	166	 
	11.18 USA PATRIOT Act Notice
	 	 	166	 
	11.19 Judgment Currency
	 	 	167	 
	11.20 Language
	 	 	167	 
	11.21 Intercreditor Agreement
	 	 	167	 
	 
	SIGNATURES
	 	 	S-1	 






iv









 






	 	 	 	 	 
	SCHEDULES
	 	 	 	 
	 
	 	 	 	 
	1.01 Existing Letters of Credit
	 	 	 	 
	 
	 	 	 	 
	2.01 Commitments and Applicable Percentages
	 	 	 	 
	 
	 	 	 	 
	4.01(a)(vi) Mortgaged Properties
	 	 	 	 
	 
	 	 	 	 
	5.06 Litigation
	 	 	 	 
	 
	 	 	 	 
	5.08(b) Owned Real Property
	 	 	 	 
	 
	 	 	 	 
	5.08(c)(i) Leased Real Property (Lessee)
	 	 	 	 
	 
	 	 	 	 
	5.09 Environmental Matters
	 	 	 	 
	 
	 	 	 	 
	5.13 Subsidiaries and Other Equity Investments; Loan Parties
	 	 	 	 
	 
	 	 	 	 
	5.25 Canadian Pension Matters
	 	 	 	 
	 
	 	 	 	 
	6.12 Guarantors
	 	 	 	 
	 
	 	 	 	 
	7.01 Existing Liens
	 	 	 	 
	 
	 	 	 	 
	7.02 Existing Investments
	 	 	 	 
	 
	 	 	 	 
	7.03(b) Existing Indebtedness
	 	 	 	 
	 
	 	 	 	 
	7.05 Dispositions
	 	 	 	 
	 
	 	 	 	 
	7.08 Transactions with Affiliates
	 	 	 	 
	 
	 	 	 	 
	7.09 Burdensome Agreements
	 	 	 	 
	 
	 	 	 	 
	11.02 Administrative Agent’s Office, Certain Addresses for Notices
	 	 	 	 






v









 






	 	 	 	 	 
	EXHIBITS
	 	 	 	 
	 
	 	 	 	 
	Form of
	 	 	 	 
	 
	 	 	 	 
	A Committed Loan Notice
	 	 	 	 
	 
	 	 	 	 
	B Swing Line Loan Notice
	 	 	 	 
	 
	 	 	 	 
	C-1 U.S. Revolving Credit Note
	 	 	 	 
	 
	 	 	 	 
	C-2 Canadian Revolving Credit Note
	 	 	 	 
	 
	 	 	 	 
	D Compliance Certificate
	 	 	 	 
	 
	 	 	 	 
	E-1 Assignment and Assumption
	 	 	 	 
	 
	 	 	 	 
	E-2 Administrative Questionnaire
	 	 	 	 
	 
	 	 	 	 
	F-1 U.S. Guaranty
	 	 	 	 
	 
	 	 	 	 
	G-1 U.S. Security Agreement
	 	 	 	 
	 
	 	 	 	 
	H Mortgage
	 	 	 	 
	 
	 	 	 	 
	I Intercompany Note
	 	 	 	 
	 
	 	 	 	 
	J [Reserved]
	 	 	 	 
	 
	 	 	 	 
	K [Reserved]
	 	 	 	 
	 
	 	 	 	 
	L Borrowing Base Certificate
	 	 	 	 
	 
	 	 	 	 
	M-1 Perfection Certificate
	 	 	 	 
	 
	 	 	 	 
	N Approved Plan of Reorganization
	 	 	 	 






vi









 






CREDIT AGREEMENT




          This CREDIT AGREEMENT (“Agreement”) is entered into as of December 17, 2009, among
NORTEK, INC., a Delaware corporation (the “Specified U.S. Borrower” and, in its capacity as
the representative of the other Borrowers pursuant to Section 2.15 hereof, the
“Borrower Agent”), Ventrol Air Handling Systems Inc., a Canadian corporation (the
“Canadian Borrower”), the Subsidiaries of the Specified U.S. Borrower from time to time
party hereto as Borrowers and Guarantors, each Lender from time to time party hereto, BANK OF
AMERICA, N.A. (with its successors, “Bank of America”), as Administrative Agent, a
Collateral Agent, U.S. Swing Line Lender and U.S. L/C Issuer, BANK OF AMERICA, N.A. (acting through
its Canada branch) (with its successors, “Bank of America-Canada Branch”), as Canadian
Swing Line Lender and Canadian L/C Issuer, and GENERAL ELECTRIC CAPITAL CORPORATION and WELLS FARGO
FOOTHILL, LLC, as Collateral Agents and Co-Syndication Agents.




PRELIMINARY STATEMENTS:




          The Specified U.S. Borrower and its Subsidiaries intend to establish an asset-based revolving
credit facility, the proceeds of which will be used (i) to refinance and replace the Existing
Credit Agreement, (ii) for working capital and other general corporate purposes of the Specified
U.S. Borrower and its Subsidiaries, (iii) for the payment of fees and expenses incurred in
connection with the Transactions and (iv) to pay all other amounts expressly permitted under the
Approved Plan of Reorganization.




          In furtherance of the foregoing, the Borrowers have requested that the Lenders provide a
revolving credit facility, and the Lenders have indicated their willingness to lend and the L/C
Issuers have indicated their willingness to issue letters of credit, in each case, on the terms and
subject to the conditions set forth herein.




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




ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS




          1.01 Defined Terms. As used in this Agreement (including the Preliminary Statements),
the following terms shall have the meanings set forth below:




          “2011 Senior Subordinated Notes” means all outstanding 9 7/8% unsecured senior
subordinated notes due 2011 issued by the Specified U.S. Borrower pursuant to the 2011 Senior
Subordinated Notes Indenture.




          “2011 Senior Subordinated Notes Indenture” means the Indenture, dated as of June 12,
2001, by and among Nortek, Inc. and U.S. Bank National Association, as successor in interest to
State Street Bank and Trust Company.




          “2014 Senior Subordinated Notes” means all outstanding 8.50% unsecured senior
subordinated notes due 2014 issued by the Specified U.S. Borrower, pursuant to the 2014 Senior
Subordinated Notes Indenture.







 









 








          “2014 Senior Subordinated Notes Indenture” means the Indenture dated as of August 27,
2004 among U.S. Bank National Association, the Specified U.S. Borrower and the Guarantors, together
with all instruments and other agreements in connection therewith.




          “ABL Priority Collateral” means the “Revolving Facility First Lien Collateral” (as
defined in the Intercreditor Agreement).




          “Account” has the meaning specified in the UCC (or, with respect to a Canadian Loan
Party, the PPSA), and shall include any and all rights of a Loan Party to payment for goods sold or
leased or for services rendered that are not evidenced by an Instrument or Chattel Paper, whether
or not they have been earned by performance.




          “Account Debtor” a Person who is obligated under an Account, Chattel Paper or General
Intangible.




          “Act” has the meaning specified in Section 11.18.




          “Administrative Agent” means Bank of America in its capacity as administrative agent
under any of the Loan Documents, or any successor administrative agent and, with respect to matters
relating to the Canadian Revolving Credit Facility, means Bank of America-Canada Branch, in its
capacity as Canadian administrative agent under any of the Loan Documents, or any successor
Canadian administrative agent.




          “Administrative Agent’s Office” means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 11.02, or such other address or account as
the Administrative Agent may from time to time notify to the Borrowers and the Lenders.




          “Administrative Questionnaire” means an Administrative Questionnaire in substantially
the form of Exhibit E-2 or any other form approved by the Administrative Agent.




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




          “Affiliated Lender” has the meaning specified in Section 11.06(b)(v).




          “Agent Parties” has the meaning specified in Section 11.02(c)




          “Aggregate Commitments” means the Commitments of all the Lenders.




          “Agreement” means this Credit Agreement.




          “Anti-Terrorism Laws” has the meaning specified in Section 5.23(a).




          “Applicable Commitment Fee Rate” means, for each fiscal quarter of the Specified U.S.
Borrower ending after the Closing Date, (a) 0.5% per annum, if the Average Revolving Credit
Facility Balance during such fiscal quarter is greater than 50% of the Average Aggregate
Commitments outstanding during such period, (b) 0.75% per annum, if the Average Revolving Credit
Facility Balance during such fiscal quarter is less than or equal to 50% and greater than 25% of
the Average Aggregate Commitments outstanding during such period, or (c) 1.00%, if the Average
Revolving Credit Facility Balance during such fiscal quarter is less than or equal to 25% of the
Average Aggregate Commitments






2









 







outstanding during such period; provided that, with respect to the fiscal quarter of
the Specified U.S. Borrower in which the Closing Date occurs, the “Applicable Commitment Fee Rate”
shall be calculated on the basis of the Average Revolving Credit Facility Balance and Average
Aggregate Commitments outstanding during the period from the Closing Date through the end of such
fiscal quarter.




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




          “Applicable Rate” means, (a) for each of (i) the fiscal quarter of the Specified U.S.
Borrower in which the Closing Date occurs and (ii) the first full fiscal quarter of the Specified
U.S. Borrower ending after the Closing Date, the applicable percentage per annum set forth below
determined by reference to Excess Availability as of the Closing Date (after giving effect to the
Transactions) and (b) for each fiscal quarter thereafter, the applicable percentage per annum set
forth below determined by reference to Average Excess Availability for the immediately preceding
fiscal quarter:




	 	 	 	 	 	 	 
	Applicable Rate
	 	 	 	 	Eurodollar Rate, BA	 	Base Rate, Canadian
	 	 	Average Excess	 	Rate and Letter of	 	Base Rate and
	Pricing Level	 	Availability	 	Credit Fees	 	Canadian Prime Rate
	 
	1
	 	> $200,000,000
	 	3.75%
	 	2.75%
	 	 	 	 	 	 	 
	2
	 	> $125,000,000 but £
	 	4.00%
	 	3.00%
	 
	 	$200,000,000	 	 	 	 
	 	 	 	 	 	 	 
	3
	 	> $50,000,000 but £
	 	4.25%
	 	3.25%
	 
	 	$125,000,000	 	 	 	 
	 	 	 	 	 	 	 
	4
	 	£ $50,000,000
	 	4.50%
	 	3.50%





Any increase or decrease in the Applicable Rate resulting from a change in the Average Excess
Availability shall become effective as of the first calendar day of each fiscal quarter. Average
Excess Availability shall be calculated by the Administrative Agent based on the Administrative
Agent’s records. If the Borrowing Base Certificates (including any required financial information
in support thereof) of the Borrowers are not received by the Administrative Agent by the date
required pursuant to Section 6.01(f) of this Agreement, then, upon the request of the
Required Lenders, the Applicable Rate shall be determined as if the Average Excess Availability for
the immediately preceding fiscal quarter is at Level 4 until such time as such Borrowing Base
Certificates and supporting information are received.



Notwithstanding anything to the contrary contained in this definition, the determination of the
Applicable Rate for any period shall be subject to the provisions of Section 2.10(b).







3









 








          “Application Date” has the meaning specified in Section 2.05(c).




          “Appropriate Lender” means, at any time, (a) (i) with respect to the U.S. Revolving
Credit Facility, a Lender that has a Commitment with respect to the U.S. Revolving Credit Facility
or holds a U.S. Revolving Credit Loan at such time, (ii) with respect to the U.S. Letter of Credit
Sublimit, (A) each U.S. L/C Issuer and (B) if any U.S. Letters of Credit have been issued pursuant
to Section 2.01(c), the U.S. Revolving Credit Lenders and (iii) with respect to the U.S.
Swing Line Sublimit, (A) the U.S. Swing Line Lender and (B) if any U.S. Swing Line Loans are
outstanding pursuant to Section 2.04(A)(a), the U.S. Revolving Credit Lenders and (b) (i)
with respect to the Canadian Revolving Credit Facility, a Lender that has a Commitment with respect
to the Canadian Revolving Credit Facility or holds a Canadian Revolving Credit Loan at such time,
(ii) with respect to the Canadian Letter of Credit Sublimit, (A) each Canadian L/C Issuer and (B)
if any Canadian Letters of Credit have been issued pursuant to Section 2.01(d), the
Canadian Revolving Credit Lenders and (iii) with respect to the Canadian Swing Line Sublimit, (A)
the Canadian Swing Line Lender and (B) if any Canadian Swing Line Loans are outstanding pursuant to
Section 2.04(B)(a), the Canadian Revolving Credit Lenders.




          “Approved Fund” means any Fund 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.




          “Approved Plan of Reorganization” means a plan of reorganization under and in
compliance with the provisions of chapter 11 of the Bankruptcy Code in the form of Exhibit N
attached hereto, subject only to such changes as are not prohibited by Section 7.18.




          “Assignee Group” means two or more Eligible Assignees that are Affiliates of one
another or two or more Approved Funds managed by the same investment advisor.




          “Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is required by
Section 11.06(b)), and accepted by the Administrative Agent, in substantially the form of
Exhibit E-1 or any other form approved by the Administrative Agent.




          “Attributable Indebtedness” means, on any date, (a) in respect of any Capitalized
Lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such
Person prepared as of such date in accordance with GAAP, (b) in respect of any Synthetic Lease
Obligation, the capitalized amount of the remaining lease or similar payments under the relevant
lease or other applicable agreement or instrument that would appear on a balance sheet of such
Person prepared as of such date in accordance with GAAP if such lease or other agreement or
instrument were accounted for as a Capitalized Lease and (c) all Synthetic Debt of such Person.




          “Audited Financial Statements” means the audited consolidated balance sheet of the
Specified U.S. Borrower and its Subsidiaries for the fiscal year ended December 31, 2008 and the
related consolidated statements of income or operations, shareholders’ equity and cash flows for
such fiscal year of the Specified U.S. Borrower and its Subsidiaries, including the notes thereto.




          “Auto-Extension Letter of Credit” has the meaning specified in Section
2.03(a)(iii).




          “Availability Period” means, with respect to each Revolving Credit Facility, the
period from and including the Closing Date to the earliest of (i) the Maturity Date, (ii) the date
of termination of the applicable Revolving Credit Commitments pursuant to Section 2.06, and
(iii) the date of termination




4









 







of the commitment of each applicable Appropriate Lender to make
Revolving Credit Loans and of the obligation of the applicable L/C Issuer to make L/C Credit
Extensions pursuant to Section 8.02.




          “Availability Reserve” means, on any date of determination and with respect to the
U.S. Borrowing Base or the Canadian Borrowing Base, as the case may be, the sum (without
duplication) of (a) reserves for deterioration in the salability of inventory; (b) the Rent and
Charges Reserve; (c) the Bank Product Reserve; (d) all accrued Royalties, whether or not then due
and payable by, in the case of the U.S. Borrowing Base, a U.S. Loan Party or, in the case of the
Canadian Borrowing Base, a Canadian Loan Party; (e) the aggregate amount of liabilities secured by
Liens upon Eligible Collateral that are senior to the Administrative Agent’s Liens (but imposition
of any such reserve shall not waive an Event of Default arising therefrom); (f) the Canadian
Priority Payables Reserve; (g) reserves for excess dilution; and (h) such additional reserves, in
such amounts and with respect to such matters, as any Collateral Agent in its Credit Judgment may
elect to impose from time to time; provided that, after the Closing Date, the Collateral
Agents may adjust the apportionment of the Availability Reserve between the U.S. Revolving Credit
Facility and the Canadian Revolving Credit Facility in their Credit Judgment at such time; and
provided further that such Availability Reserve shall not be established or changed
except upon not less than five (5) Business Days’ notice to the Borrowers (unless an Event of
Default exists in which event no notice shall be required). The Collateral Agents will be available
during such period to discuss any such proposed Availability Reserve or change with the Borrowers
and without limiting the right of the Collateral Agents to establish or change such Reserves in the
Collateral Agents’ Credit Judgment, the Borrowers may take such action as may be required so that
the event, condition or matter that is the basis for such Availability Reserve no longer exists, in
a manner and to the extent reasonably satisfactory to each of the Collateral Agents. The amount of
any Availability Reserve established by the Collateral Agents shall have a reasonable relationship
as determined by the Collateral Agents in their Credit Judgment to the event, condition or other
matter that is the basis for the Availability Reserve. Notwithstanding anything herein to the
contrary, an Availability Reserve shall not be established to the extent that it would be
duplicative of any specific item excluded as ineligible in the definitions of Eligible Collateral,
but the Collateral Agents shall retain the right, subject to the requirements of this paragraph, to
establish an Availability Reserve with respect to prospective changes in Eligible Collateral that
may reasonably be anticipated.




          “Average Aggregate Commitments” means, for any period, the amount obtained by adding
the Aggregate Commitments outstanding at the end of each day for the period in question and by
dividing such sum by the number of days in such period.




          “Average Canadian Revolving Credit Commitments” means, for any period, the amount
obtained by adding the Canadian Revolving Credit Commitments outstanding at the end of each day for
the period in question and by dividing such sum by the number of days in such period.




          “Average U.S. Revolving Credit Commitments” means, for any period, the amount obtained
by adding the U.S. Revolving Credit Commitments outstanding at the end of each day for the period
in question and by dividing such sum by the number of days in such period.




          “Average Excess Availability” means, for any period, the average amount of Excess
Availability for each day during such period.




          “Average Revolving Credit Facility Balance” means, for any period, the amount obtained
by adding the Outstanding Amount of Loans (less the Outstanding Amount of any Swing Line Loans on
such date) and L/C Obligations at the end of each day for the period in question and by dividing
such sum by the number of days in such period.






5









 








          “BA Rate” means, for the Interest Period of each BA Rate Loan, the rate of interest
per annum equal to the higher of (a) 1.75% and (b) the average annual rate applicable to Canadian
Dollar bankers’ acceptances having an identical or comparable term as the proposed BA Rate Loan
displayed
and identified as such on the display referred to as the “CDOR Page” (or any display
substituted therefor) of Reuters Monitor Money Rates Service as at approximately 10:00 a.m. Toronto
time on such day (or, if such day is not a Business Day, as of 10:00 a.m. Toronto time on the
immediately preceding Business Day), plus five (5) basis points; provided that if
such rate does not appear on the CDOR Page at such time on such date, the rate under this clause
(b) for such date will be the annual discount rate (rounded upward to the nearest whole multiple of
1/100 of 1%) as of 10:00 a.m. Toronto time on such day at which a Canadian chartered bank listed on
Schedule 1 of the Bank Act (Canada) as selected by the Administrative Agent is then offering to
purchase Canadian Dollar bankers’ acceptances accepted by it having such specified term (or a term
as closely as possible comparable to such specified term), plus five (5) basis points.




          “BA Rate Loan” means any Canadian Revolving Credit Loan denominated in Canadian
Dollars bearing interest at a rate determined by reference to the BA Rate.




          “Bank of America” has the meaning specified in the introductory paragraph hereto.




          “Bank of America-Canada Branch” has the meaning specified in the introductory
paragraph hereto.




          “Bank Product” means any of the following products, services or facilities extended to
any Loan Party: (a) cash management services provided by Cash Management Banks under Cash
Management Agreements; and (b) products provided by Hedge Banks under Secured Hedge Agreements;
provided, however, that for any of the foregoing to be included as an “Obligation”
for purposes of a distribution under Section 8.03, the applicable Secured Party and the
Loan Party must have previously provided written notice to the Administrative Agent of (i) the
existence of such Bank Product, (ii) the maximum dollar amount of obligations arising thereunder to
be included as a Bank Product Reserve (the “Bank Product Amount”), and (iii) the
methodology to be used by such parties in determining the Bank Product Debt owing from time to
time. The Bank Product Amount may be changed from time to time upon written notice to the
Administrative Agent by the applicable Secured Party and Loan Party. No Bank Product Amount may be
established or increased at any time that a Default or Event of Default exists and is continuing,
or if a reserve in such amount would cause an Overadvance.




          “Bank Product Amount” has the meaning specified in the definition of “Bank Product”.




          “Bank Product Debt” means Indebtedness and other obligations of a Loan Party relating
to Bank Products.




          “Bank Product Reserve” means, with respect to the U.S. Borrowing Base or the Canadian
Borrowing Base, the aggregate amount of reserves established by the Collateral Agents from time to
time in their Credit Judgment in respect of Bank Product Debt of the U.S. Loan Parties or the
Canadian Loan Parties, as the case may be, which shall be at least equal to the sum of all Bank
Product Amounts.




          “Bankruptcy Code” means Title 11 of the United States Code.




          “Bankruptcy Court” means the United States Bankruptcy Court for the District of
Delaware.








6









 








          “Base Rate” means, for any day, a fluctuating rate per annum equal to the highest of
(a) the Federal Funds Rate plus 1/2 of 1%, (b) 1.00% plus the higher of (i) 1.75% and (ii)
the Eurodollar Rate for a 30-day Interest Period, as determined on such day and (c) the rate of
interest in effect for such day as publicly announced from time to time by Bank of America as its
“prime rate.” The “prime rate” is a rate
set by Bank of America based upon various factors including Bank of America’s costs and
desired return, general economic conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above, or below such announced rate. Any change in
such rate announced by Bank of America shall take effect at the opening of business on the day
specified in the public announcement of such change.




          “Base Rate Loan” means a Revolving Credit Loan that bears interest based on the Base
Rate.




          “BIA” means the Bankruptcy and Insolvency Act (Canada).




          “Bookrunners” means Banc of America Securities LLC, GE Capital Markets, Inc. and Wells
Fargo Foothill, LLC.




          “Borrower Agent” has the meaning specified in the introductory paragraph hereto.




          “Borrower Materials” has the meaning specified in Section 6.02.




          “Borrowers” mean the Canadian Borrower and the U.S. Borrowers.




          “Borrowing” means a Revolving Credit Borrowing or a Swing Line Borrowing, as the
context may require.




          “Borrowing Base” means any of the U.S. Borrowing Base, the Canadian Borrowing Base
and/or the Total Borrowing Base, as the context may require.




          “Borrowing Base Certificate” means a certificate substantially in the form of
Exhibit L or such other form as may be agreed to by the Administrative Agent.




          “Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact closed in, relative to
matters with respect to the U.S. Revolving Credit Facility, the state where the Administrative
Agent’s Office is located, or relative to matters with respect to the Canadian Revolving Credit
Facility, the jurisdiction where the Administrative Agent’s principal Canadian lending Affiliate or
branch is located and, if such day relates to any Eurodollar Rate Loan, means any such day on which
dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar
market.




          “CAM” means the mechanism for the allocation and exchange of interests in the Loans,
participations in Letters of Credit and collections thereunder established pursuant to Section
8.04.




          “CAM Exchange” means the exchange of the Lenders’ interests provided for in
Section 8.04.




          “CAM Exchange Date” means the first date after the Closing Date on which there shall
occur (a) any Event of Default under clause (f) or (g) of Section 8.01 with
respect to a Borrower or (b) an acceleration of Loans pursuant to Section 8.02(b).







7









 








          “CAM Percentage” means, as to each Lender, a fraction, expressed as a decimal, of
which (a) the numerator shall be the sum, without duplication, of (i) the Canadian Revolving Credit
Exposure, if any, of such Lender, (ii) the U.S. Revolving Credit Exposure, if any, of such Lender
and (iii) the aggregate amount of any other Obligations otherwise owed to such Lender pursuant to
the Loan
Documents, in each case immediately prior to the CAM Exchange Date, and (b) the denominator
shall be the sum of (i) the aggregate U.S. Revolving Credit Exposure of all the Lenders, (ii) the
aggregate Canadian Revolving Exposure of all Lenders and (iii) the aggregate amount of any other
Obligations otherwise owed to any of the Lenders pursuant to the Loan Documents, in each case
immediately prior to the CAM Exchange Date.




          “Canadian ABL Priority Collateral” means ABL Priority Collateral that is Canadian
Collateral.




          “Canadian Account Control Agreements” means, collectively, the Control Agreements
entered into by the Canadian Loan Parties in favor of the Administrative Agent, each in form and
substance reasonably satisfactory to the Administrative Agent.




          “Canadian Available Cash” means, at any time, unrestricted cash collateral of the
Canadian Borrower that (a) does not consist of proceeds of accounts receivable that are otherwise
included at such time in the calculation of the Canadian Borrowing Base and (b) is pledged to the
Administrative Agent and held in Cash Collateral Accounts at the Administrative Agent. In no event
shall any Specified Issuance Proceeds be classified as Canadian Available Cash.




          “Canadian Base Rate” means, for any day, the rate of interest in effect for such day
as publicly announced from time to time by Bank of America-Canada Branch as its “Base Rate” for
loans in Dollars in Canada. The “Canadian Base Rate” is a rate set by Bank of America-Canada
Branch based upon various factors including Bank of America-Canada Branch’s costs and desired
return, general economic conditions and other factors, and is used as a reference point for pricing
some loans, which may be priced at, above, or below such announced rate; and any change in such
rate announced by Bank of America-Canada Branch shall take effect at the opening of business on the
day specified in the public announcement of such change.




          “Canadian Base Rate Loan” means any Canadian Revolving Credit Loan denominated in
Dollars bearing interest computed by reference to the Canadian Base Rate.




          “Canadian Benefit Plans” means all employee benefit plans, programs or arrangements of
any nature or kind whatsoever that are not Canadian Pension Plans and are maintained or contributed
to by, or to which there is or may be an obligation to contribute by, any Borrower or its
Subsidiaries in respect of its employees or former employees in Canada.




          “Canadian Borrower” has the meaning specified in the introductory paragraph hereto.




          “Canadian Borrowing Base” means, on any date of determination, an amount (calculated
based on the most recent Borrowing Base Certificate delivered to the Administrative Agent in
accordance with this Agreement) equal to:




          (a) the sum of:




          (i) 85% of the value of the Eligible Receivables of the Canadian Loan Parties (other than any
Excluded Subsidiaries);




8









 








          (ii) 85% of the NOLV Percentage of the value of the Eligible Inventory of the Canadian Loan
Parties (other than any Excluded Subsidiaries); and




          (iii) (x) 100% of Canadian Available Cash up to $25,000,000 (less the amount of U.S. Available
Cash included in the calculation of the U.S. Borrowing Base at such time) for purposes of
determining whether a Borrowing is permitted or (y) 100% of Canadian Available Cash up to
$10,000,000 (less the amount of U.S. Available Cash included in the calculation of the U.S.
Borrowing Base at such time) for any other purpose under the Loan Documents (including, without
limitation in respect of the determination of whether a Cash Dominion Event or a Covenant Trigger
Event exists or compliance with any test set forth in Article VII);




          minus




          (b) the Availability Reserve to the extent attributable to the Canadian Loan Parties in the
Collateral Agents’ Credit Judgment on such date, provided that, after the Closing Date, the
Collateral Agents may adjust the apportionment of the Availability Reserve between the U.S.
Revolving Credit Facility and the Canadian Revolving Credit Facility in their Credit Judgment.




          “Canadian Cash Management Bank” means any Person that, at the time it enters into a
Cash Management Agreement, is a Canadian Lender or an Affiliate of a Canadian Lender, in its
capacity as a party to such Cash Management Agreement, in each case in respect of services provided
under such Cash Management Agreement to a Canadian Loan Party.




          “Canadian Collateral” means all of the “Collateral” referred to in the Canadian
Collateral Documents and all of the other property that is or is intended under the terms of the
Canadian Collateral Documents to be subject to Liens in favor of the Administrative Agent for the
benefit of the Canadian Secured Parties.




          “Canadian Collateral Documents” means, collectively, the Canadian Security Agreement,
the Canadian Account Control Agreements, each of the collateral assignments, Security Agreement
Supplements, IP Security Agreement Supplements, security agreements, deeds of hypothec, hypothecs,
pledge agreements or other similar agreements delivered to the Administrative Agent pursuant to
Section 6.12, and each of the other agreements, instruments or documents that creates or
purports to create a Lien securing the Canadian Obligations in favor of the Administrative Agent
for the benefit of the Canadian Secured Parties.




          “Canadian Dollar” or “Cdn. $” means Canadian dollars, the lawful currency of
Canada.




          “Canadian Excess Availability” means, at any time, the difference between (a) the
lesser of (i) the Canadian Revolving Credit Facility and (ii) the Canadian Borrowing Base at such
time, as determined from the most recent Borrowing Base Certificate delivered by the Borrower Agent
to the Administrative Agent pursuant to Section 6.01(f) hereof minus (b) the Total
Canadian Revolving Credit Outstandings.




          “Canadian Guarantee” means, collectively, the Guarantees made by the Canadian
Subsidiary Guarantors in favor of the Canadian Secured Parties, each in form and substance
reasonably satisfactory to the Administrative Agent, together with each other guarantee and
guarantee supplement delivered pursuant to Section 6.12.




          “Canadian Hedge Bank” means any Hedge Bank that is party to a Canadian Secured Hedge
Agreement.







9









 








          “Canadian L/C Advance” means, with respect to each Canadian Revolving Credit Lender,
such Lender’s funding of its participation in any Canadian L/C Borrowing in accordance with its
Applicable Percentage.




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




          “Canadian L/C Credit Extension” means, with respect to any Canadian Letter of Credit,
the issuance thereof or extension of the expiry date thereof, or the increase of the amount
thereof.




          “Canadian L/C Issuer” means Bank of America-Canadian Branch in its capacity as issuer
of Canadian Letters of Credit hereunder, any successor thereto in such capacity or any other
Canadian Lender (or any Affiliate of a Canadian Lender) that has agreed to act in such capacity.




          “Canadian L/C Obligations” means, as at any date of determination, the aggregate
amount available to be drawn under all outstanding Canadian Letters of Credit plus the
aggregate of all Unreimbursed Amounts in respect of Canadian Letters of Credit, including all
Canadian L/C Borrowings. For purposes of computing the amount available to be drawn under any
Canadian Letter of Credit, the amount of such Letter of Credit shall be determined in accordance
with Section 1.07. For all purposes of this Agreement, if on any date of determination a
Canadian Letter of Credit has expired by its terms but any amount may still be drawn thereunder by
reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be
“outstanding” in the amount so remaining available to be drawn.




          “Canadian Lender” means each financial institution listed on Schedule 2.01 as
a “Canadian Revolving Credit Lender”, as well as any Person that becomes a “Canadian Revolving
Credit Lender” hereunder pursuant to Section 11.06 and, as the context requires, includes
the Canadian Swing Line Lender.




          “Canadian Letter of Credit” means any standby letter of credit or commercial letter of
credit issued under the Canadian Revolving Credit Facility.




          “Canadian Letter of Credit Sublimit” means an amount equal to $5,000,000. The
Canadian Letter of Credit Sublimit is part of, and not in addition to, the Canadian Revolving
Credit Facility.




          “Canadian Loan” means an extension of credit by a Lender to the Canadian Borrower
under Article II in the form of a Canadian Revolving Credit Loan or a Canadian Swing Line
Loan.




          “Canadian Loan Parties” means the Canadian Borrower and the Canadian Subsidiary
Guarantors.




          “Canadian Obligations” means all advances to, and debts, liabilities, obligations,
covenants and duties of, any Canadian Loan Party arising under any Loan Document or otherwise with
respect to any Canadian Loan, Canadian Letter of Credit, Canadian Secured Cash Management Agreement
or Canadian Secured Hedge Agreement, whether direct or indirect (including those acquired by
assumption), absolute or contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against any Canadian Loan
Party or any Subsidiary thereof of any proceeding under any Debtor Relief Laws naming such Person
as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims
in such proceeding.







10









 








          “Canadian Overadvance” has the meaning specified in Section 2.01(f).




          “Canadian Overadvance Loan” means a Canadian Revolving Credit Loan made when an
Overadvance exists or is caused by the funding thereof.




          “Canadian Payment Account” means the Canadian Dollar account and the Dollar account of
the Administrative Agent to which all monies constituting proceeds of Canadian Collateral shall be
transferred from time to time.




          “Canadian Pension Plans” means each plan, program or arrangement which is required to
be registered as a pension plan under any applicable pension benefits standards or tax statute or
regulation in Canada (or any province or territory thereof) maintained or contributed to by, or to
which there is or may be an obligation to contribute by, any Borrower or its Subsidiaries in
respect of its Canadian employees or former employees.




          “Canadian Prime Rate” means, for any day, a fluctuating rate of interest per annum
equal to the rate of interest in effect for such day as publicly announced from time to time by
Bank of America-Canada Branch as its “Prime Rate.” The “Canadian Prime Rate” is a rate set by Bank
of America-Canada Branch based upon various factors including Bank of America-Canada Branch’s costs
and desired return, general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced rate; and any change
in such rate announced by Bank of America-Canada Branch shall take effect at the opening of
business on the day specified in the public announcement of such change.




          “Canadian Prime Rate Loan” means any Canadian Revolving Credit Loan denominated in
Canadian Dollars bearing interest computed by reference to the Canadian Prime Rate.




          “Canadian Priority Payables” means, at any time, with respect to the Canadian
Borrowing Base:




          (a) the amount past due and owing by the Canadian Borrower and any other Canadian Loan Party,
or the accrued amount for which each of the Canadian Borrower and any other Canadian Loan Party has
an obligation to remit to a Governmental Authority or other Person pursuant to any applicable Law,
in respect of (i) pension fund obligations; (ii) employment insurance; (iii) goods and services
taxes, sales taxes, harmonized taxes, excise taxes, value added taxes, employee income taxes and
other taxes or governmental royalties payable or to be remitted or withheld; (iv) workers’
compensation; (v) wages, vacation pay and amounts payable under the Wage Earner Protection Program
Act (Canada); and (vi) other like charges and demands; in each case, in respect of which any
Governmental Authority or other Person may claim a security interest, hypothec, prior claim, lien,
trust or other claim or Lien ranking or capable of ranking in priority to or pari passu with one or
more of the Liens granted in the Collateral Documents; and




          (b) the aggregate amount of any other liabilities of the Canadian Borrower and any other
Canadian Loan Parties (i) in respect of which a trust has been or may be imposed on any Collateral
to provide for payment or (ii) which are secured by a security interest, hypothec, prior claim,
pledge, lien, charge, right, or claim or other Lien on any Collateral; in each case, pursuant to
any applicable Law and which trust, security interest, hypothec, prior claim, pledge, lien, charge,
right, claim or Lien ranks or is capable of ranking in priority to or pari passu with one or more
of the Liens granted in the Collateral Documents.







11









 








          “Canadian Priority Payables Reserve” means, on any date of determination for the
Canadian Borrowing Base, a reserve established from time to time by the Collateral Agents in their
reasonable Credit Judgment in such amount as the Collateral Agents may determine reflects the
unpaid or unremitted Canadian Priority Payables by the Canadian Loan Parties, which would give rise
to a Lien under applicable Laws with priority over, or pari passu with, the Lien of the
Administrative Agent for the benefit of the Canadian Secured Parties.




          “Canadian Protective Advances” has the meaning specified in Section 2.01(g).




          “Canadian Revolving Credit Borrowing” means a borrowing consisting of simultaneous
Canadian Revolving Credit Loans of the same Type and, in the case of Eurodollar Rate Loans and BA
Rate Loans, having the same Interest Period made by each of the Canadian Revolving Credit Lenders.




          “Canadian Revolving Credit Commitment” means, as to each Canadian Revolving Credit
Lender, its obligation to (a) make Canadian Revolving Credit Loans to the Canadian Borrower
pursuant to Section 2.01(b), (b) purchase participations in Canadian L/C Obligations, and
(c) purchase participations in Canadian Swing Line Loans, in an aggregate principal amount at any
one time outstanding not to exceed the amount set forth opposite such Lender’s name on Schedule
2.01 under the caption “Canadian Revolving Credit Commitment” or opposite such caption in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as
such amount may be adjusted from time to time in accordance with this Agreement.




          “Canadian Revolving Credit Exposure” means, with respect to any Canadian Revolving
Credit Lender at any time, the Outstanding Amount of Canadian Revolving Credit Loans of such Lender
plus such Lender’s Applicable Percentage of the Outstanding Amount of Canadian L/C
Obligations with respect to Canadian Letters of Credit plus such Lender’s Applicable
Percentage of the Outstanding Amount of Canadian Swing Line Loans.




          “Canadian Revolving Credit Facility” means, at any time, the aggregate amount of the
Canadian Revolving Credit Lenders’ Canadian Revolving Credit Commitments at such time.




          “Canadian Revolving Credit Lender” means, at any time, any Lender that has a Canadian
Revolving Credit Commitment at such time.




          “Canadian Revolving Credit Loan” has the meaning specified in Section 2.01(b)
and shall be deemed to include any Canadian Overadvance Loan and Canadian Protective Advance made
hereunder.




          “Canadian Revolving Credit Note” means a promissory note made by the Canadian Borrower
in favor of a Canadian Revolving Credit Lender evidencing Canadian Revolving Credit Loans or
Canadian Swing Line Loans, as the case may be, made by such Canadian Revolving Credit Lender,
substantially in the form of Exhibit C-2.




          “Canadian Secured Cash Management Agreement” means any Secured Cash Management
Agreement that is entered into by and between any Canadian Loan Party and any Cash Management Bank.




          “Canadian Secured Hedge Agreement” means any Secured Hedge Agreement that is entered
into by and between any Canadian Loan Party and any Hedge Bank.







12









 








          “Canadian Secured Parties” means, collectively, the Administrative Agent, each
Collateral Agent, the Canadian Revolving Credit Lenders, each Canadian L/C Issuer, the Canadian
Hedge Banks, the Canadian Cash Management Banks, each co-agent or sub-agent appointed by the
Administrative Agent from time to time pursuant to Section 9.05, and the other Persons the
Canadian Obligations owing to which are or are purported to be secured by the Canadian Collateral
under the terms of the Collateral Documents.




          “Canadian Security Agreement” means, collectively, the Security Agreements, security
agreement supplements and the deeds of hypothec delivered pursuant to Section 4.01 or
Section 6.12, in each case in respect of the Canadian Collateral, in each case in form and
substance reasonably satisfactory to the Administrative Agent.




          “Canadian Subsidiary” means any direct or indirect Subsidiary of the Specified U.S.
Borrower which is incorporated or otherwise organized under the laws of Canada or any province or
territory thereof.




          “Canadian Subsidiary Guarantor” means each Canadian Subsidiary listed on Schedule
6.12 and each Person that shall, at any time, execute and deliver a Canadian Guarantee; it
being understood that none of the Canadian Borrower or any Canadian Subsidiary Guarantors shall
guarantee any of the U.S. Obligations.




          “Canadian Swing Line Borrowing” means a borrowing of a Canadian Swing Line Loan
pursuant to Section 2.04(B).




          “Canadian Swing Line Lender” means Bank of America-Canada Branch in its capacity as
provider of Canadian Swing Line Loans, or any successor swing line lender hereunder.




          “Canadian Swing Line Loan” has the meaning specified in Section 2.04(B)(a).




          “Canadian Swing Line Sublimit” means an amount equal to $3,000,000. The Canadian
Swing Line Sublimit is part of, and not in addition to, the Canadian Revolving Credit Facility.




          “Capital Expenditures” means, with respect to any Person for any period, any
expenditure in respect of the purchase or other acquisition of any fixed or capital asset
(excluding normal replacements and maintenance which are properly charged to current operations);
provided, however, that Capital Expenditures shall not include any such
expenditures which constitute (a) a Permitted Acquisition, (b) capital expenditures relating to the
construction or acquisition of any property which has been transferred to a Person that is not a
Borrower pursuant to a sale-leaseback transaction permitted under Section 7.05(f), (c) a
reinvestment of (i) the net cash proceeds of any Disposition of any fixed or capital assets or (ii)
any insurance proceeds paid on account of loss or damage to any fixed or capital assets assets, in
either case, in fixed or capital assets useful in the business of such Person (d) the purchase
price of fixed or capital assets purchased substantially contemporaneously with the trade-in or
sale of existing fixed or capital assets to the extent that the gross amount of such purchase price
is reduced by the credit granted to the seller of such property (or for the net proceeds of such
sale) for the property being traded in or sold at such time, or (f) capitalized interest relating
to the construction of any fixed assets.




          “Capitalized Leases” means all leases that have been or should be, in accordance with
GAAP, recorded as capitalized leases.







13









 








          “Capital Lease Obligation” means, at the time any determination thereof is to be made,
the amount of the liability in respect of a Capitalized Lease that would at that time be required
to be capitalized on a balance sheet in accordance with GAAP.




          “Cases” means the voluntary cases commenced by the Specified U.S. Borrower and certain
of its Affiliates under the Bankruptcy Code in the Bankruptcy Court on October 21, 2009.




          “Cash Collateral Account” means a blocked deposit account of one or more of the Loan
Parties at Bank of America (or its Affiliates or branches or at another commercial bank selected in
compliance with Section 6.18) or an account in the name of the Administrative Agent, and in
each case under the sole dominion and control of the Administrative Agent and otherwise established
in a manner reasonably satisfactory to the Administrative Agent.




          “Cash Collateralize” has the meaning specified in Section 2.03(f).




          “Cash Dominion Event” means either (a) the occurrence and continuance of an Event of
Default or (b) the failure of the Loan Parties to maintain Excess Availability of at least the
greater of (x) 20% of the Total Borrowing Base and (y) $40,000,000. For purposes of this
Agreement, the occurrence of a Cash Dominion Event shall be deemed continuing (a) so long as such
Event of Default is continuing and has not been cured or waived, and/or (b) if the Cash Dominion
Event arises under clause (b) of the preceding sentence, until Excess Availability is at least the
greater of (x) 20% of the Total Borrowing Base and (y) $40,000,000 for thirty (30) consecutive
days, in which case a Cash Dominion Event shall no longer be deemed to be continuing for purposes
of this Agreement.




          “Cash Equivalents” means any of the following types of Investments, to the extent
owned by the Borrowers or any of their Subsidiaries free and clear of all Liens (other than Liens
created under the Collateral Documents and other Liens permitted hereunder):





     (a) readily marketable obligations issued or directly and fully guaranteed or insured
by the United States of America (or Canada) or any agency or instrumentality thereof having
maturities of not more than 360 days from the date of acquisition thereof; provided
that the full faith and credit of the United States of America (or Canada, as the case may
be) is pledged in support thereof;




     (b) time deposits with, or insured certificates of deposit or bankers’ acceptances of,
any commercial bank that (i) (A) is a Lender or (B) is organized under the laws of the
United States of America, any state thereof or the District of Columbia or is the principal
banking subsidiary of a bank holding company organized under the laws of the United States
of America, any state thereof or the District of Columbia, and is a member of the Federal
Reserve System, (ii) issues (or the parent of which issues) commercial paper rated as
described in clause (c) of this definition and (iii) has combined capital and surplus of at
least $500,000,000, in each case with maturities of not more than 365 days from the date of
acquisition thereof;




     (c) commercial paper issued by any Person organized under the laws of any state of the
United States of America and rated at least “Prime-1” (or the then equivalent grade) by
Moody’s or at least “A-1” (or the then equivalent grade) by S&P, in each case with
maturities of not more than 180 days from the date of acquisition thereof;




     (d) Investments, classified in accordance with GAAP as current assets of the Borrowers
or any of their Subsidiaries, in money market investment programs registered under the
Investment Company Act of 1940, which are administered by financial institutions that have



14









 







the highest rating obtainable from either Moody’s or S&P, and the portfolios of which
are limited solely to Investments of the character, quality and maturity described in
clauses (a), (b) and (c) of this definition;




     (e) repurchase agreements entered into by any Person with a bank or trust company
(including any of the Lenders) or recognized securities dealer having capital and surplus in
excess of $500,000,000 for direct obligations issued by or fully guaranteed by the United
States in which such Person shall have a perfected first priority security interest (subject
to no other Liens) and having, on the date of purchase thereof, a fair market value of at
least 100% of the amount of the repurchase obligations; and




     (f) readily marketable direct obligations issued by any state of the United States or
any political subdivision thereof having one of the two highest rating categories obtainable
from either S&P or Moody’s with maturities of not more than twelve (12) months from the date
of acquisition thereof;




provided that instruments equivalent to those referred to in clauses (a)
through (f) above denominated in Canadian Dollars which are comparable in credit
quality and tenor to those referred to above and customarily used by corporations for short
term cash management purposes in Canada shall be permitted under Sections 7.02(a)
and 7.05(g) to the extent reasonably required in connection with any business
conducted by any Canadian Subsidiary; provided, further, that instruments
equivalent to those referred to in clauses (a) through (f) above denominated in local
currencies other than Dollars or Canadian Dollars which are comparable in credit quality and
tenor to those referred to above and customarily used by corporations for short term cash
management purposes in the jurisdiction of the relevant Foreign Subsidiary shall be
permitted under Sections 7.02(a) and 7.05(g) to the extent reasonably
required in connection with any business conducted by such Foreign Subsidiary.



          “Cash Management Agreement” means any agreement to provide cash management services,
including treasury, depository, overdraft, credit or debit card, electronic funds transfer and
other cash management arrangements.




          “Cash Management Bank” means a U.S. Cash Management Bank and/or a Canadian Cash
Management Bank, as the context may require.




          “CCAA” means the Companies’ Creditors Arrangement Act (Canada), and any rule or
regulation issued thereunder.




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




          “CERCLIS” means the Comprehensive Environmental Response, Compensation and Liability
Information System maintained by the U.S. Environmental Protection Agency.




          “CFC” means a Person that is a controlled foreign corporation under Section 957 of the
Code.




          “Change in Law” means the occurrence, after the date of this Agreement, of any of the
following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any
change in any law, rule, regulation or treaty or in the administration, interpretation or
application thereof by any






15









 







Governmental Authority or (c) the making or issuance of any request, guideline or directive
(whether or not having the force of law) by any Governmental Authority.




          “Change of Control” means an event or series of events by which:




          (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of such person or its
subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary
or administrator of any such plan) other than the Equity Investors becomes the “beneficial owner”
(as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934), directly or
indirectly, of more than the greater of (i) 35% or more of the Equity Interests of the Specified
U.S. Borrower entitled to vote for members of the board of directors or equivalent governing body
of the Specified U.S. Borrower on a fully-diluted basis and (ii) the percentage of the then
outstanding Equity Interests of the Specified U.S. Borrower entitled to vote for members of the
board of directors or equivalent governing body of the Specified U.S. Borrower owned beneficially
by the Equity Investors; or




          (b) during any period of 12 consecutive months, a majority of the members of the board of
directors or other equivalent governing body of the Specified U.S. Borrower cease to be composed of
Continuing Directors; or




          (c) any “Change of Control” (or any comparable term) in any document pertaining the Senior
Secured Notes or to any Junior Financing with an aggregate outstanding principal amount in excess
of the Threshold Amount; or




          (d) the Canadian Borrower shall cease to be a wholly owned Subsidiary of the Specified U.S.
Borrower, unless simultaneously with such transaction, the Canadian Obligations (other than
contingent Obligations in respect of unasserted indemnity claims) have been paid in full in cash
and the Canadian Revolving Credit Commitments are terminated.




          “Closing Date” means the first date all the conditions precedent in Section
4.01 are satisfied or waived in accordance with Section 11.01.




          “Code” means the Internal Revenue Code of 1986.




          “Collateral” means the U.S. Collateral and the Canadian Collateral.




          “Collateral Agents” means Bank of America, General Electric Capital Corporation and
Wells Fargo Foothill, LLC, in their capacities as “collateral agents” under this Agreement.




          “Collateral Documents” means the U.S. Collateral Documents and the Canadian Collateral
Documents.




          “Commitment Date” has the meaning specified in Section 2.05(c).




          “Commitment Increase” has the meaning specified in Section 2.16(a).




          “Commitment Increase Lender” has the meaning specified in Section 2.16(b).




          “Commitment Letter” means the letter agreement, dated October 9, 2009, among the
Specified U.S. Borrower, the Bookrunners and the Initial Lenders.







16









 








          “Committed Loan Notice” means a notice of (a) a Revolving Credit Borrowing, (b) a
conversion of Loans from one Type to the other, or (c) a continuation of Eurodollar Rate Loans or
BA Rate Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially in
the form of Exhibit A.




          “Commodity Account Control Agreements” has the meaning specified in the U.S. Security
Agreement and/or the Canadian Security Agreement, as the context may require.




          “Compliance Certificate” means a certificate substantially in the form of Exhibit
D.




          “Confirmation Order” has the meaning specified in Section 4.01(g).




          “Consolidated EBITDA” means, with respect to any specified Person for any period, the
sum, without duplication, of: (1) Consolidated Net Income of such Person for such period;
plus (2) provision for taxes based on income or profits of such Person and its
Subsidiaries for such period (including amounts actually paid pursuant to any tax sharing
arrangement relating to combined, consolidated, unitary or similar tax returns to the extent that
such amounts do not exceed the amount of taxes attributable to such Person and its Subsidiaries
determined as if such Person and its Subsidiaries filed separate tax returns), to the extent that
such provision for taxes was deducted in computing such Consolidated Net Income; plus (3)
consolidated interest expense of such Person and its Subsidiaries for such period, whether or not
paid or accrued and whether or not capitalized (including, without limitation, amortization of debt
issuance costs and original issue discount, non-cash interest payments, the interest component of
any deferred payment obligations, the interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to Attributable Indebtedness, commissions,
discounts and other fees and charges incurred in respect of letter of credit or bankers’ acceptance
financings, and net of the effect of all payments made or received pursuant to Hedging
Obligations), to the extent that any such expense was deducted in computing such Consolidated Net
Income; plus (4) depreciation, amortization (including amortization of the step-up in
inventory valuation arising from purchase accounting and other intangibles) and other non-cash
expenses (excluding any such non-cash expense to the extent that it represents an accrual of or
reserve for cash expenses in any future period or amortization of a prepaid cash expense that was
paid in a prior period) of such Person and its Subsidiaries for such period to the extent that such
depreciation, amortization and other non-cash expenses were deducted in computing such Consolidated
Net Income; plus (5) any reasonable expenses, fees or charges related to the Transactions
or any acquisition or Investment, in each case to the extent that any such expenses, fees or
charges were deducted in computing such Consolidated Net Income; plus (6) other
non-recurring cash charges not to exceed in the aggregate $3.0 million in any fiscal year;
minus (7) non-cash items increasing such Consolidated Net Income for such period, excluding
any items which represent the reversal of any accrual of, or cash reserve for, anticipated cash
charges in any period.




          Notwithstanding the preceding, the provision for taxes based on the income or profits of, and
the depreciation and amortization and other non-cash expenses of, a Subsidiary of the Specified
U.S. Borrower shall be added to Consolidated Net Income to compute Consolidated EBITDA of the
Specified U.S. Borrower only to the extent that a corresponding amount would be permitted at the
date of determination to be dividended to the Specified U.S. Borrower by such Subsidiary without
prior governmental approval (that has not been obtained), and without direct or indirect
restriction pursuant to the terms of its charter and all agreements, instruments, judgments,
decrees, orders, statutes, rules and governmental regulations applicable to that Subsidiary or its
stockholders.




          “Consolidated Fixed Charge Coverage Ratio” means, at any date of determination, the
ratio of (a) (i) Consolidated EBITDA of the Specified U.S. Borrower and its Subsidiaries,
less (ii) the aggregate amount of all Capital Expenditures of or by the Specified U.S.
Borrower and its Subsidiaries






17









 







less (iii) taxes paid or payable in cash by the Specified U.S. Borrower and its Subsidiaries
(net of refunds received or receivable) to (b) the sum of (i) Consolidated Net Cash Interest
Charges of the Specified U.S. Borrower and its Subsidiaries, and (ii) the aggregate principal
amount of all Mandatory Principal Payments, but excluding (A) any such payments to the extent
financed through the incurrence of additional Indebtedness otherwise expressly permitted under
Section 7.03, (B) any such payments in respect of seller notes, earn-outs or the Existing
Credit Facility in each case made before the Closing Date, for the most recently completed
Measurement Period and (C) the amount of Consolidated Net Cash Interest Charges and Mandatory
Principal Payments attributable to the 2011 Senior Subordinated Notes, the 2014 Senior Subordinated
Notes, the 103/4% Senior Discount Notes due 2014 of NTK Holdings, Inc. and other Indebtedness of NTK
Holdings, Inc. that in each case have been converted into new common equity of the Specified U.S.
Borrower or otherwise extinguished pursuant to the Approved Plan of Reorganization;
provided that (x) for purposes of determining pro forma compliance with the Consolidated
Fixed Charge Coverage Ratio for any Permitted Acquisition of any Person or business and for any
Investment in any Person or business under Section 7.02(n)(iii), pro forma effect shall be given to
such Permitted Acquisition and Investment (in each case without giving effect to any synergies or
cost savings), so long as, solely in the case of any such Permitted Acquisition or Investment for
consideration in excess of $10,000,000, the Administrative Agent shall be furnished with audited
financial statements, or if audited financial statements are not available, other financial
statements reasonably acceptable to the Administrative Agent, of such Person or business (or if the
acquisition is of a business unit, line of business or division of any Person, the audited
financial statements, or if audited financial statements are not available, other financial
statements reasonably acceptable to the Administrative Agent, of such Person, so long as the
individual activities of the acquired business are clearly reflected in such financial statements
(provided that, in the case of any Permitted Acquisition or Investment for consideration of
$10,000,000 or less, the Administrative Agent shall be furnished with such financial statements as
may be available to the Specified U.S. Borrower and its Subsidiaries with respect to such Person or
business or division of such Person), together with a certificate from a financial officer of the
Borrower Agent certifying that the Borrower Agent has reviewed the historical financial statements
of the business unit, line of business or division and that to the knowledge of the Borrower Agent
they reflect proper divisional accounting in relation to the larger business), reasonably
satisfactory to the Administrative Agent in all respects, confirming such historical results and
(y) in the event that the Specified U.S. Borrower or any of its Subsidiaries incurs, assumes,
Guarantees, repays, repurchases or redeems any Indebtedness or issues, repurchases or redeems
Disqualified Equity Interests or preferred stock subsequent to the commencement of the period for
which the Consolidated Fixed Charge Coverage Ratio is being calculated and on or prior to the date
on which the event for which the calculation of the Consolidated Fixed Charge Coverage Ratio is
made, then the Consolidated Fixed Charge Coverage Ratio shall be calculated giving pro forma effect
to such incurrence, assumption, Guarantee, repayment, repurchase, or redemption of Indebtedness, or
such issuance, repurchase or redemption of Disqualified Equity Interests or preferred stock and the
use of the proceeds therefrom as if the same had occurred at the beginning of the applicable
Measurement Period.




          “Consolidated Net Cash Interest Charges” means, for any Measurement Period, with
respect to any specified Person, the sum, without duplication of: (1) the consolidated interest
expense of such Person and its Subsidiaries for such period, whether paid or accrued, including,
without limitation, amortization of debt issuance costs and original issue discount, noncash
interest payments (other than the amortization of discount or imputed interest arising as a result
of purchase accounting), the interest component of any deferred payment obligations, the interest
component of all payments associated with Capital Lease Obligations, imputed interest with respect
to Attributable Indebtedness, commissions, discounts and other fees and charges incurred in respect
of letter of credit or bankers’ acceptance financings, and net of the effect of all payments made
or received pursuant to Hedging Obligations; plus (2) the consolidated interest of such
Person and its Subsidiaries that was capitalized during such period; plus (3) any interest
expense on Indebtedness of another Person that is Guaranteed by such Person or one






18









 







of its Subsidiaries or secured by a Lien on assets of such Person or one of its Subsidiaries,
whether or not such Guarantee or Lien is called upon; plus (4) the product of (a) all
dividends and distributions, whether paid or accrued and whether or not in cash, on any series of
preferred stock or Disqualified Equity Interests of such Person or any of its Subsidiaries, other
than dividends on Equity Interests payable solely in Equity Interests of the issuer (other than
Disqualified Equity Interests) or to the issuer or a Subsidiary that is a Guarantor, times (b) a
fraction, the numerator of which is one and the denominator of which is one minus the then current
combined federal, state and local statutory tax rate of such Person, expressed as a decimal, in
each case, on a consolidated basis and in accordance with GAAP; minus (5) the amortization
or expensing of financing fees and debt discount incurred by the issuer and its Subsidiaries
including amortization arising from the Transactions and recognized in the applicable period;
minus (6) interest income for such period to the extent not deducted in determining
Consolidated Net Cash Interest Charges in any previous period and to the extent not included in the
calculation of Consolidated EBITDA for such period, but excluding, in each of the forgoing clauses,
any fees, costs or expenses related to the Transactions; provided that, for purposes of
determining Consolidated Net Cash Interest Charges with respect to any Measurement Period ending in
the fiscal quarter in which the Closing Date occurs or any of the first full four fiscal quarters
ending thereafter, (i) in the case of calculations made during the fiscal quarter in which the
Closing Date occurs, “Consolidated Net Cash Interest Charges” shall refer to Consolidated Net Cash
Interest Charges for the period from the Closing Date to the applicable date of determination
multiplied by a factor, the numerator of which is 365 and the denominator of which is the number of
days in the period from the Closing Date to the applicable date of determination, (ii) in the case
of calculations made during the first full fiscal quarter ending after the Closing Date,
“Consolidated Net Cash Interest Charges” shall refer to Consolidated Net Cash Interest Charges for
the period from the Closing Date to the applicable date of determination multiplied by a factor,
the numerator of which is 365 and the denominator of which is the number of days in the period from
the Closing Date to the applicable date of determination, (iii) in the case of calculations made
during the second full fiscal quarter ending after the Closing Date, “Consolidated Net Cash
Interest Charges” shall refer to Consolidated Net Cash Interest Charges for the most recently ended
fiscal quarter multiplied by four, (iv) in the case of calculations made during the third full
fiscal quarter ending after the Closing Date, “Consolidated Net Cash Interest Charges” shall refer
to Consolidated Net Cash Interest Charges of the two most recently ended fiscal quarters multiplied
by two and (v) in the case of calculations made during the fourth full fiscal quarter ending after
the Closing Date, “Consolidated Net Cash Interest Charges” shall refer to Consolidated Net Cash
Interest Charges of the three most recently ended fiscal quarters multiplied by 4/3.




          “Consolidated Net Income” means, with respect to any specified Person for any period,
the aggregate of the Net Income of such Person and its Subsidiaries for such period, on a
consolidated basis, determined in accordance with GAAP; provided that:





     (a) the Net Income of any Person that is not a Subsidiary, or that is accounted for by
the equity method of accounting shall be excluded; provided that, to the extent not
previously included, Consolidated Net Income shall be increased by the amount of dividends
or distributions paid in cash to the specified Person or a Subsidiary thereof;
provided that accounting adjustments resulting from “fresh start accounting” with
respect to the Transactions and fees and expenses paid in connection with the Transactions
shall be excluded;




     (b) the Net Income of any Subsidiary that is not a Loan Party shall be excluded to the
extent that the declaration or payment of dividends or similar distributions by that
Subsidiary of that Net Income is not at the date of determination permitted without any
prior governmental approval (that has not been obtained) or, directly or indirectly, by
operation of the terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Subsidiary or its stockholders,
unless such restriction with respect to



19









 







the payment of dividends or similar distributions
has been legally waived; provided that
Consolidated Net Income of such Person shall be increased by the amount of dividends or
distributions or other payments that are actually paid in cash (or to the extent converted
into cash) to such Person or a Subsidiary thereof (subject to provisions of this clause (2))
during such period, to the extent not previously included therein;




     (c) the Net Income (or loss) of any Person acquired in a pooling of interests
transaction for any period prior to the date of such acquisition shall be excluded;




     (d) the cumulative effect of a change in accounting principles shall be excluded;




     (e) non-cash charges relating to employee benefit or other management compensation
plans of any parent company of the Specified U.S. Borrower (to the extent such non-cash
charges relate to plans of such parent company for the benefit of members of the Board of
Directors of the Specified U.S. Borrower (in their capacity as such) or employees of the
Specified U.S. Borrower and its Subsidiaries), the Specified U.S. Borrower or any of its
Subsidiaries or any non-cash compensation charge arising from any grant of stock, stock
options or other equity-based awards of any parent company of the Specified U.S. Borrower
(to the extent such non-cash charges relate to plans of such parent company for the benefit
of members of the Board of Directors of the Specified U.S. Borrower (in their capacity as
such) or employees of the Specified U.S. Borrower and its Subsidiaries), the Specified U.S.
Borrower or any of its Subsidiaries (excluding in each case any non-cash charge to the
extent that it represents an accrual of or reserve for cash expenses in any future period or
amortization of a prepaid cash expense incurred in a prior period) in each case, to the
extent that such non-cash charges are deducted in computing such Consolidated Net Income
shall be excluded;




     (f) any non-cash goodwill or other impairment charges resulting from the application of
Statement of Financial Accounting Standards No. 142 or Statement of Financial Accounting
Standards No. 144, and non-cash charges relating to the amortization of intangibles
resulting from the application of Statement of Financial Accounting Standards No. 141, shall
be excluded;




     (g) any increase in cost of sales as a result of the step-up in inventory valuation
arising from applying the purchase method of accounting in accordance with GAAP in
connection with any acquisition consummated after the date of this Agreement, net of taxes,
shall be excluded;




     (h) unrealized gains and losses relating to hedging transactions and mark-to-market of
Indebtedness denominated in foreign currencies resulting from the application of Statement
of Financial Accounting Standards No. 52 shall be excluded; and




     (i) all restructuring charges, including severance, relocation and transition costs,
and fees and expenses related to such restructuring, shall be excluded.



          “Continuing Directors” shall mean the directors of the Specified U.S. Borrower on the
Closing Date, and each other director, if, in each case, such other director’s nomination for
election to the board of directors of the Specified U.S. Borrower is or was recommended by a
majority of the then Continuing Directors or such other director receives or received the vote of
the Equity Investors in his or her election by the stockholders of the Specified U.S. Borrower.







20









 








          “Contractual Obligation” means, as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or other undertaking to which such Person is a party
or by which it or any of its property is bound.




          “Control” means the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person, whether through the ability to
exercise voting power, by contract or otherwise. “Controlling” and “Controlled”
have meanings correlative thereto.




          “Control Agreement” has the meaning specified in the U.S. Security Agreement and/or
the Canadian Security Agreement, as the context may require.




          “Covenant Trigger Event” means, at any time, either (a) the occurrence and continuance
of an Event of Default or (b) the failure of the Loan Parties to maintain Excess Availability of at
least the greater of (x) $40,000,000 and (y) 15% of the Total Borrowing Base. For purposes of this
Agreement, the occurrence of a Covenant Trigger Event shall be deemed continuing (a) so long as
such Event of Default is continuing and has not been cured or waived and/or (b) if the Covenant
Trigger Event arises under clause (b) of the preceding sentence, until Excess Availability is at
least the greater of (x) $40,000,000 and (y) 15% of the Total Borrowing Base for thirty (30)
consecutive days, in which case a Covenant Trigger Event shall no longer be deemed to be continuing
for purposes of this Agreement. For purposes of determining whether a Covenant Trigger Event shall
have occurred and is continuing, no greater than 25% of Excess Availability shall be composed of
Canadian Excess Availability and no greater than 25% of the Total Borrowing Base shall be composed
of the Canadian Borrowing Base.




          “Credit Extension” means each of the following: (a) a Borrowing and (b) an L/C Credit
Extension.




          “Credit Judgment” means the Collateral Agents’ commercially reasonable judgment
exercised in good faith, based upon their consideration of any factor that they reasonably believe
(a) could materially adversely affect the quantity, quality, mix or value of Collateral (including
any applicable Law that may inhibit collection of an Account), the enforceability or priority of
the Administrative Agent’s Liens, or the amount that the Collateral Agents and the Lenders could
receive in liquidation of any Collateral; (b) suggests that any collateral report or financial
information delivered by any Loan Party is incomplete, inaccurate or misleading in any material
respect; (c) materially increases the likelihood of any proceeding under any Debtor Relief Laws
involving a Loan Party; or (d) creates or could result in an Event of Default. In exercising such
judgment, (i) the Collateral Agents may consider any factors that could materially increase the
credit risk of lending to the Borrowers on the security of the Collateral and (ii) the
Administrative Agent shall communicate to the Borrower Agent the Collateral Agents’ judgment at the
direction of the Collateral Agents (and in the event that the Collateral Agents do not all agree on
any action relating to any such matters, the determination shall reflect the position of the
Collateral Agent that asserts the most conservative credit judgment on behalf of the Lenders).




          “Debtor Relief Laws” means the Bankruptcy Code of the United States, the BIA, the CCAA
and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws
of the United States, Canada or other applicable jurisdictions from time to time in effect and
affecting the rights of creditors generally.




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







21









 








          “Default Rate” means (a) when used with respect to Obligations other than Letter of
Credit Fees, an interest rate equal to (i) the Base Rate, Canadian Base Rate or Canadian Prime
Rate, as applicable plus (ii) the Applicable Rate, if any, applicable to Base Rate Loans,
Canadian Base Rate Loans or Canadian Prime Rate Loans, as the case may be, under the Revolving
Credit Facility plus (iii) 2% per annum; provided, however, that with
respect to a Eurodollar Rate Loan or a BA Rate Loan, the Default Rate shall be an interest rate
equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan
plus 2% per annum and (b) when used with respect to Letter of Credit Fees, a rate equal to
the Applicable Rate plus 2% per annum.




          “Defaulting Lender” means any Lender that (a) has failed to fund any portion of the
Revolving Credit Loans, participations in L/C Obligations or participations in Swing Line Loans
required to be funded by it hereunder within one Business Day of the date required to be funded by
it hereunder, (b) has otherwise failed to pay over to the Administrative Agent or any other Lender
any other amount required to be paid by it hereunder within one Business Day of the date when due,
unless the subject of a good faith dispute, or (c) has been deemed insolvent or become the subject
of a proceeding under Debtor Relief Laws.




          “Deposit Account Control Agreements” has the meaning specified in the U.S. Security
Agreement and/or the Canadian Security Agreement, as the context may require.




          “Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property owned by any Person,
including any sale, assignment, transfer, license, lease or other disposal, with or without
recourse, of any notes or accounts receivable or any rights and claims associated therewith;
provided that the issuance of Equity Interests of any Person shall not be considered a
Disposition by such Person.




          “Disqualified Equity Interests” means any Equity Interest which, by its terms (or by
the terms of any security or other Equity Interests into which it is convertible or for which it is
exchangeable), or upon the happening of any event or condition (a) matures or is mandatorily
redeemable (other than solely for Equity Interests (other than Disqualified Equity Interests)),
pursuant to a sinking fund obligation or otherwise, (b) is redeemable at the option of the holder
thereof, in whole or in part, (c) provides for the scheduled payments of dividends in cash, or (d)
is or becomes convertible into or exchangeable for Indebtedness or any other Equity Interests that
would constitute Disqualified Equity Interests, in each case for clauses (a) through (d), prior to
the date that is ninety one (91) days after the Maturity Date; provided that if such Equity
Interest is issued to any employee or to any plan for the benefit of employees of the Specified
U.S. Borrower or any of its Subsidiaries or by any such plan to such employees, such Equity
Interest shall not constitute a Disqualified Equity Interest solely because it may be required to
be repurchased by the Specified U.S. Borrower or such Subsidiary in order to satisfy applicable
statutory or regulatory obligations; and provided further that any Equity Interest
that would constitute a Disqualified Equity Interest solely because the holders thereof have the
right to require the Specified U.S. Borrower to repurchase such Equity Interest upon the occurrence
of a change of control or an asset sale shall not constitute a Disqualified Equity Interest if the
terms of such Equity Interest provide that the Specified U.S. Borrower may not repurchase or redeem
any such Equity Interest pursuant to such provisions prior to the repayment in full of the
Obligations.




          “Dollar” and “$” mean lawful money of the United States.




          “Dollar Equivalent” means, at any time, (a) with respect to any amount denominated in
Dollars, such amount, and (b) with respect to any amount denominated in any other currency, the
equivalent amount thereof in Dollars as determined by the Administrative Agent or the L/C Issuers,
as the case may be, at such time on the basis of the Spot Rate in accordance with Section 1.08
.







22









 








          “Domestic Subsidiary” means any Subsidiary that is organized under the Laws of the
United States, any state thereof or the District of Columbia.




          “Dominion Account” means any Deposit Account of a Loan Party at Bank of America or its
Affiliates or branches or another bank acceptable to the Administrative Agent, in each case which
is subject to a Deposit Account Control Agreement.




          “Eligible Assignee” means any Person that meets the requirements to be an assignee
under Section 11.06(b)(iii), (v) and (vi) (subject to such consents, if
any, as may be required under Section 11.06(b)(iii)).




          “Eligible Collateral” means, collectively, Eligible Inventory and Eligible
Receivables.




          “Eligible Foreign Receivables” means Accounts payable in a currency other than Dollars
or Canadian Dollars or arising out of sale to debtors outside of the United States and Canada which
in each case are acceptable to the Collateral Agents in their Credit Judgment.




          “Eligible Inventory”  means Inventory of the Loan Parties (other than any
Excluded Subsidiaries) subject to the Lien of the Collateral Documents, the value of which shall be
determined by taking into consideration, among other factors, the lowest of its cost and its book
value determined in accordance with GAAP and excluding any portion of cost attributable to
intercompany profit among the Loan Parties and their Affiliates; provided however
that, subject to the ability of the Collateral Agents to establish other criteria of ineligibility
in their Credit Judgment or modify the criteria established below, unless otherwise approved by the
Collateral Agents in their Credit Judgment, none of the following classes of Inventory shall be
deemed to be Eligible Inventory:





     (a) Inventory consisting of “perishable agricultural commodities” within the meaning of
the Perishable Agricultural Commodities Act of 1930, or on which a Lien has arisen or may
arise in favor of agricultural producers under any comparable Laws;




     (b) Inventory that is obsolete, unusable or otherwise unavailable for sale;




     (c) Inventory consisting of promotional, marketing, packaging or shipping materials and
supplies;




     (d) Inventory that fails to meet all standards imposed by any Governmental Authority
having regulatory authority over such Inventory or its use or sale;




     (e) Inventory that is subject to any licensing, patent, royalty, trademark, trade name
or copyright agreement with any third party from which the Borrowers or any of their
Subsidiaries has received notice of a dispute in respect of any such agreement;




     (f) Inventory (i) with respect to the U.S. Borrowing Base, located outside the United
States and (ii) with respect to the Canadian Borrowing Base, located outside of Canada;




     (g) Inventory that is located on premises owned, leased or rented by a customer of any
Borrower, or is placed on consignment; provided, that Inventory placed on
consignment with an aggregate book value of up to $15,000,000 shall consist of Eligible
Inventory if such Inventory is clearly segregated from all Inventory of such customer, all
UCC and PPSA filings deemed necessary or desirable by the Administrative Agent have been
made, and a reasonably satisfactory Lien Waiver has been delivered to Administrative Agent
by such customer;



23









 






     (h) Inventory with respect to which the representations and warranties set forth
herein, in the U.S. Security Agreement and in the Canadian Security Agreement applicable to
such Inventory are not correct;




     (i) Inventory in respect of which the U.S. Security Agreement or the Canadian Security
Agreement, as applicable, after giving effect to the related filings of financing statements
that have then been made, if any, does not or has ceased to create a valid and perfected
first priority Lien or security interest in favor of the Administrative Agent, on behalf of
the applicable Secured Parties, securing the applicable Obligations;




     (j) Inventory subject to any Lien securing any judgment; and




     (k) it is not either (i) otherwise acceptable to or (ii) subject to a reserve
acceptable to, the Collateral Agents, in their Credit Judgment.




If the Collateral Agents deem Inventory ineligible in their Credit Judgment (and not based
upon the criteria set forth above), then the Collateral Agents shall give the Borrower Agent
two (2) Business Days’ prior notice thereof (unless an Event of Default exists, in which
event no notice shall be required).



          “Eligible Receivables” means Accounts of the Loan Parties (other than any Excluded
Subsidiaries) subject to the Lien of the Collateral Documents, the value of which shall be
determined by taking into consideration, among other factors, their book value determined in
accordance with GAAP, net of any returns, rebates, discounts (calculated on the shortest terms),
credits, allowances or Taxes (including sales, excise or other taxes) that have been or could be
claimed by the Account Debtor or any other Person; provided, however, that, for the
avoidance of doubt, cash proceeds of any of the Accounts of the Loan Parties do not constitute
Eligible Receivables; provided, further, that subject to the ability of the
Collateral Agents to establish other criteria of ineligibility in their Credit Judgment or modify
the criteria established below, unless otherwise approved by the Collateral Agents in their Credit
Judgment, none of the following classes of Accounts shall be deemed to be Eligible Receivables:





     (a) Accounts that do not arise out of sales of goods or rendering of services in the
ordinary course of the Borrowers’ or the relevant Subsidiaries’ business;




     (b) Accounts payable other than in Dollars or, in the case of Canadian Loan Parties,
Dollars or Canadian Dollars, or that are otherwise on terms other than those normal or
customary in the Borrowers’ or the relevant Subsidiaries’ business, except for up to the
Dollar Equivalent of $12,000,000 (in the aggregate, taken together with Eligible Foreign
Receivables included under clause (j) of this definition) in Eligible Foreign
Receivables;




     (c) Accounts arising out of a sale made or services rendered by any Borrower to a
Subsidiary of any Borrower or an Affiliate of any Borrower or to a Person Controlled by an
Affiliate of any Borrower (including any employees of such Borrower);




     (d) Accounts (i) more than 120 days past the original invoice date (other than (A) up
to $6,000,000 of Accounts having extended payment terms which are acceptable to the
Collateral Agents in their Credit Judgment and (B) Accounts in respect of which the account
debtor has provided a letter of credit reasonably acceptable to the Collateral Agents) or
(ii) more than 60 days past the original due date;



24









 






     (e) Accounts owing from any Person from which an aggregate amount of more than 50% of
the Accounts owing therefrom is more than 120 days past original invoice date or more than
60 days past the date due;




     (f) Accounts owing from any Person that exceed 20% of the net amount of all Eligible
Receivables, but only to the extent of such excess;




     (g) Accounts owing from any Person that (i) has disputed liability for any Account
owing from such Person or has been placed on credit hold due to past due balances or (ii)
has otherwise asserted any claim, demand or liability against a Borrower or any of its
Subsidiaries, whether by action, suit, counterclaim or otherwise;




     (h) Accounts owing from any Person that shall take or be the subject of any action or
proceeding of a type described in Section 8.01(f);




     (i) Accounts (i) owing from any Person that is also a supplier to or creditor of a
Borrower or any of its Subsidiaries unless such Person has waived any right of setoff in a
manner acceptable to the Administrative Agent, (ii) representing any manufacturer’s or
supplier’s credits, discounts, incentive plans or similar arrangements entitling a Borrower
or any of its Subsidiaries to discounts on future purchase therefrom, (iii) in respect of
which the related invoice(s) has been reversed;




     (j) Accounts arising out of sales to account debtors outside the United States and
Canada, except for up to the Dollar Equivalent of $12,000,000 (in the aggregate, taken
together with Eligible Foreign Receivables included under clause (b) of this
definition) in Eligible Foreign Receivables, unless such Accounts are fully backed by an
irrevocable letter of credit on terms, and issued by a financial institution, acceptable to
the Administrative Agent and such irrevocable letter of credit is in the possession of the
Administrative Agent;




     (k) Accounts arising out of sales on a bill-and-hold, cash in advance or cash on
delivery payment terms, guaranteed sale, sale-or-return, sale on approval or consignment
basis or subject to any right of return, setoff or charge back or Accounts representing any
unapplied cash;




     (l) Accounts owing from an account debtor that is an agency, department or
instrumentality of the United States or any state thereof or Canada or any province or
territory thereof unless the applicable Borrower or its relevant Subsidiary shall have
satisfied the requirements of the Assignment of Claims Act of 1940, or the Financial
Administration Act (Canada) and any similar state, provincial or territorial legislation and
the Administrative Agent is satisfied as to the absence of setoffs, counterclaims and other
defenses on the part of such account debtor;




     (m) Accounts with respect to which the representations and warranties set forth herein,
in the U.S. Security Agreement and in the Canadian Security Agreement applicable to such
Accounts are not correct;




     (n) Accounts in respect of which the applicable Security Agreement, after giving effect
to the related filings of financing statements that have then been made, if any, does not or
has ceased to create a valid and perfected first priority lien or security interest in favor
of the Administrative Agent, on behalf of the Secured Parties, securing the Obligations;




     (o) Accounts subject to any Lien securing any judgment;




25











 






     (p) Accounts relating to the third party billing arrangements with Nordyne, Inc.;
and




     (q) it is not either (a) otherwise acceptable to or (b) subject to a reserve acceptable
to, the Collateral Agents, in their Credit Judgment.


If the Collateral Agents deem Accounts ineligible in their Credit Judgment (and not based upon the
criteria set forth above), then the Collateral Agents shall give the Borrower Agent two (2)
Business Days’ prior notice thereof (unless an Event of Default exists, in which event no notice
shall be required).




          “Environmental Laws” means any and all applicable federal, state, provincial,
territorial, municipal, local, and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, licenses, and the common law relating to pollution or the
protection of the environment (including ambient air, indoor air, surface wastes, groundwater, land
and subsurface strata), human health and safety as it relates to environmental protection and
natural resources including those related to Release or threat of Release, or exposure to, or
generation, storage, treatment, transport, handling, distribution or disposal of Hazardous
Materials.




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




          “Environmental Permit” means any permit, approval, identification number, license or
other authorization required under any Environmental Law.




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




          “Equity Investors” means the Management Shareholders and their respective Affiliates,
Fidelity, Ares, Goldman Sachs Asset Management, L.P. and Capital Research and Management Company.




          “ERISA” means the Employee Retirement Income Security Act of 1974.




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




          “ERISA Event” means (a) (i) the occurrence of a Reportable Event with respect to a
Pension Plan or a Termination Event with respect to a Canadian Pension Plan or (ii) the
requirements of






26









 







Section 4043(b) of ERISA apply with respect to a contributing sponsor, as defined in Section
4001(a)(13) of ERISA, of a Pension Plan, and an event described in paragraph (9), (10), (11), (12)
or (13) of Section 4043(c) of ERISA is reasonably expected to occur with respect to such Pension
Plan within the following 30 days; (b) a withdrawal by the Borrowers or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial
employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated
as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the
Borrowers or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer
Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a
Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or
condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan; (f) the imposition of any liability under
Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA,
upon the Borrowers or any ERISA Affiliate; (g) the withdrawal by any Loan Party or any ERISA
Affiliate from a Pension Plan that is a multiple employer or other plan described in Section
4064(a) of ERISA during a plan year for which it was a substantial employer, as defined in Section
4001(a)(2) of ERISA; (h) the conditions for imposition of a Lien under Section 303(k) of ERISA or
other applicable Laws shall have been met with respect to any Pension Plan or Canadian Pension
Plan; or (i) a determination that any Pension Plan is in “at risk” status (within the meaning of
Section 303 of ERISA).




          “Eurodollar Rate” means, for any Interest Period with respect to a Eurodollar Rate
Loan, the rate per annum equal to the higher of (a) 1.75% and (b) the British Bankers Association
LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other commercially available source
providing quotations of BBA LIBOR as designated by the Administrative Agent from time to time) at
approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest
Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period; provided that if such rate is not available at such
time for any reason, then the rate under this clause (b) for such Interest Period shall be the rate
per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for
delivery on the first day of such Interest Period in same day funds in the approximate amount of
the Eurodollar Rate Loan being made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of America’s London Branch to major
banks in the London interbank eurodollar market at their request at approximately 11:00 a.m.
(London time) two Business Days prior to the commencement of such Interest Period.




          “Eurodollar Rate Loan” means a Revolving Credit Loan that bears interest at a rate
based on the Eurodollar Rate.




          “Event of Default” has the meaning specified in Section 8.01.




          “Excess Availability” means the sum of U.S. Excess Availability and Canadian Excess
Availability.




          “Excluded Accounts” has the meaning specified in the U.S. Security Agreement and/or
the Canadian Security Agreement, as the context may require.




          “Excluded Subsidiary” means, on any date, (a) any Subsidiary of the Specified U.S.
Borrower (i) that, together with its Subsidiaries on a consolidated basis, has less than $250,000
in total assets, (ii) the total assets of which, together with its Subsidiaries on a consolidated
basis and all Excluded Subsidiaries as of such date, is less than $2,500,000 and (iii) that does
not have any Indebtedness






27









 







(including by way of Guarantee) in respect of money borrowed other than Indebtedness hereunder
and under the Senior Secured Notes (including by way of Guarantees in respect of the Revolving
Credit Facility or the Senior Secured Notes) (it being understood, without limitation to the
foregoing, that in no event shall any Subsidiary that provides a Guarantee of the Senior Secured
Notes be an Excluded Subsidiary for purposes of Section 6.12) and (b) solely for purposes
of Section 6.12, Linear H.K. LLC (so long as Linear H.K. LLC is held directly or indirectly
by a Foreign Subsidiary).




          “Excluded Taxes” means, with respect to the Administrative Agent, any Lender, any L/C
Issuer or any other recipient of any payment to be made by or on account of any obligation of a
Borrower hereunder, (a) taxes imposed on or measured by its overall gross or net income (however
denominated), and franchise taxes imposed on it (in lieu of gross or net income taxes), by the
jurisdiction (or any political subdivision thereof) under the Laws of which such recipient is
organized or in which its principal office is located or, in the case of any Lender or L/C Issuer,
in which its applicable Lending Office is located, (b) any branch profits taxes imposed by the
United States or any similar tax imposed by any other jurisdiction in which a Loan Party is located
and (c) in the case of a Lender or L/C Issuer, any United States withholding tax or backup
withholding tax that (i) is required to be imposed on amounts payable to such Lender or L/C Issuer
pursuant to the Laws in force at the time such Lender or L/C Issuer becomes a party hereto or
designates a new Lending Office (other than an assignee pursuant to a request by the Borrower Agent
under Section 11.13 and other than as assignee Lender pursuant to a CAM Exchange under
Section 8.04), except to the extent that such Lender or L/C Issuer (or its assignor, if
any) was entitled, at the time of the designation of a new Lending Office (or assignment), to
receive additional amounts from the Borrowers with respect to such withholding tax pursuant to
Section 3.01(a)(ii) or (ii) is attributable to such Lender’s or L/C Issuer’s failure or
inability (other than as a result of a Change in Law) to comply with Section 3.01(e).




          “Executive Order” has the meaning specified in Section 5.23(a).




          “Existing Credit Agreement” means the Credit Agreement, dated as of May 20, 2008,
among the Borrowers, Bank of America, N.A., as administrative agent and the lender parties and
other agents party thereto.




          “Existing Letters of Credit” means the letters of credit listed on Schedule
1.01 and outstanding on the Closing Date.




          “Extraordinary Receipt” means any proceeds of property or casualty insurance and
condemnation awards (and payments in lieu thereof) relating to any ABL Priority Collateral of the
Loan Parties and their respective Subsidiaries.




          “Facility” means the U.S. Revolving Credit Facility and/or the Canadian Revolving
Credit Facility, as the context may require.




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







28









 








          “Fee Letters” has the meaning specified in the Commitment Letter.




          “Final Order” has the meaning specified in Section 4.01(g).




          “Foreign L/C Issuer” means any Lender that is not a “United States person” within the
meaning of Section 7701(a)(30) of the Code that is acting in the capacity of an L/C Issuer.




          “Foreign Lender” means any Lender that is not a “United States person” within the
meaning of Section 7701(a)(30) of the Code (including such a Lender when acting in the capacity of
an L/C Issuer).




          “Foreign Loan Party” means any Loan Party other than a U.S. Loan Party.




          “Foreign Plan” means any employee benefit plan, program, policy, arrangement or
agreement maintained or contributed to by, or entered into with, the Specified U.S. Borrower or any
Subsidiary with respect to employees employed outside the United States.




          “Foreign Subsidiary” means any direct or indirect Subsidiary of the Specified U.S.
Borrower that is not a Domestic Subsidiary.




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




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




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




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




          “Guarantee” means, as to any Person, (a) any obligation, contingent or otherwise, of
such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other
obligation payable or performable by another Person (the “primary obligor”) in any manner,
whether directly or indirectly, and including any obligation of such Person, direct or indirect,
(i) to purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for
the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the
payment or performance of such Indebtedness or other obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity or level of income or cash
flow of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other
obligation, or (iv) entered into for the purpose of assuring in any other manner the






29









 







obligee in respect of such Indebtedness or other obligation of the payment or performance
thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b)
any Lien on any assets of such Person securing any Indebtedness or other obligation of any other
Person, whether or not such Indebtedness or other obligation is assumed by such Person (or any
right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien);
provided that the term “Guarantee” shall not include customary and reasonable indemnity
obligations in effect on the Closing Date or entered into in connection with any acquisition or
Disposition of assets permitted under this Agreement (other than such obligations with respect to
Indebtedness). The amount of any Guarantee shall be deemed to be an amount equal to the stated or
determinable amount of the related primary obligation, or portion thereof, in respect of which such
Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability
in respect thereof as determined by the guaranteeing Person in good faith. The term
“Guarantee” as a verb has a corresponding meaning.




          “Guarantors” means, collectively, the Specified U.S. Borrower, the Subsidiaries of the
Specified U.S. Borrower listed on Schedule 6.12 and each other Subsidiary of the Specified
U.S. Borrower that shall be required to execute and deliver a guaranty or guaranty supplement
pursuant to Section 6.12.




          “Guaranties” means the U.S. Guaranty and the Canadian Guarantee.




          “Hazardous Materials” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants regulated as such pursuant to any
Environmental Law, including petroleum or petroleum distillates, asbestos or asbestos-containing
materials, greenhouse gases, polychlorinated biphenyls, radon gas, mold, infectious or medical
wastes.




          “Hedge Bank” means any Person that, at the time it enters into a Swap Contract
permitted under Article VI or VII, is a Lender or an Affiliate of a Lender, in its
capacity as a party to such Swap Contract.




          “Hedging Obligations” means, with respect to any specified Person, the obligations of
such Person under:





     (a) interest rate swap agreements, interest rate cap agreements, interest rate collar
agreements and other agreements or arrangements designed for the purpose of fixing, hedging
or swapping interest rate risk;




     (b) commodity swap agreements, commodity option agreements, forward contracts and other
agreements or arrangements designed for the purpose of fixing, hedging or swapping commodity
price risk; and




     (c) foreign exchange contracts, currency swap agreements and other agreements or
arrangements designed for the purpose of fixing, hedging or swapping foreign currency
exchange rate risk.



          “Honor Date” has the meaning specified in Section 2.03(b).




          “Incremental Amendment” has the meaning specified in Section 2.16(a).







30









 








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





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




     (b) the maximum amount of all direct or contingent obligations of such Person arising
under letters of credit (including standby and commercial), bankers’ acceptances, bank
guaranties and similar instruments;




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




     (d) all obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of business that are paid
before the earlier of (i) 60 days past the date they are due or (ii) 180 days after their
creation);




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




     (f) all Attributable Indebtedness in respect of Capitalized Leases and Synthetic Lease
Obligations of such Person and all Synthetic Debt of such Person;




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




     (h) all Guarantees of such Person in respect of any of the foregoing;


provided that, “Indebtedness” shall not include any post-closing payment adjustments or
earn-out, non-competition or consulting obligations existing on the Closing Date or incurred in
connection with Investments permitted under Section 7.02(h), (n) or (o) (i)
if such obligations are not required to be reflected as a liability on the balance sheet of the
applicable Person (but only to the extent reflected in the liabilities section of the balance sheet
as opposed to the footnotes thereto) or (ii) if at the time of such Investment, the Specified U.S.
Borrower was able to satisfy the tests in Section 7.02(h), (n) or (o), as
applicable, after giving pro forma effect to the maximum possible payment that could result from
such adjustment, earn-out or other obligation as if paid on the date of consummation of such
Investment (as certified to the Administrative Agent in reasonable detail by a Responsible Officer
of the Borrower).




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




          “Indemnified Taxes” means Taxes other than Excluded Taxes.




          “Indemnitees” has the meaning specified in Section 11.04(b).







31









 








          “Information” has the meaning specified in Section 11.07.




          “Information Memorandum” means the information memorandum intended to be used by the
Bookrunners in connection with the syndication of the Commitments.




          “Initial Lenders” means Bank of America, General Electric Capital Corporation, Wells
Fargo Foothill, LLC, Wells Fargo Foothill Canada ULC and PNC Bank, National Association.




          “Intellectual Property Security Agreements” means the U.S. Intellectual Property
Security Agreement and the Canadian Intellectual Property Security Agreement.




          “Intercompany Note” means an intercompany note, substantially in the form of
Exhibit I, executed by the Specified U.S. Borrower and each of its Subsidiaries and
endorsed in blank by each of the U.S. Loan Parties.




          “Intercreditor Agreement” means the Lien Subordination and Intercreditor Agreement
dated as of December 17, 2009, among the Administrative Agent under and as defined in the Existing
Credit Agreement, on behalf of the “Revolving Facility Secured Parties” (as defined therein), the
Trustee, on behalf of the “Noteholder Secured Parties” (as defined therein), and the U.S. Loan
Parties.




          “Interest Payment Date” means, (a) as to any Eurodollar Rate Loan or BA Rate Loan, the
last day of each Interest Period applicable to such Loan and the Maturity Date of the Facility
under which such Loan was made; provided, however, that if any Interest Period for
a Eurodollar Rate Loan or a BA Rate Loan exceeds 90 days, the respective dates that fall every 30
days after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as
to any Base Rate Loan, Canadian Base Rate Loan, Canadian Prime Rate Loan or Swing Line Loan, the
first Business Day of each April, July, October and January and the Maturity Date of the Facility
under which such Loan was made (with Swing Line Loans being deemed made under the Revolving Credit
Facility for purposes of this definition).




          “Interest Period” means, as to each Eurodollar Rate Loan and BA Rate Loan, the period
commencing on the date such Eurodollar Rate Loan or BA Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan or BA Rate Loan, and ending on the date 30, 60, 90 or 180 days
thereafter, as selected by a Borrower in its Committed Loan Notice or such other period that is 365
days or less requested by a Borrower and consented to by all the Appropriate Lenders;
provided that:





     (a) any Interest Period that would otherwise end on a day that is not a Business Day
shall be extended to the next succeeding Business Day unless such Business Day falls in
another calendar month, in which case such Interest Period shall end on the next preceding
Business Day;




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




     (c) no Interest Period shall extend beyond the Maturity Date of the Facility under
which such Loan was made.



          “Inventory” has the meaning specified in the UCC or the PPSA, as applicable, and shall
include all goods intended for sale or lease by a Loan Party, or for display or demonstration; all
work in process, all raw materials, and other materials and supplies of every nature and
description used or which might be used in connection with the manufacture, printing, packing,
shipping, advertising, selling,






32









 







leasing or furnishing such goods or otherwise used or consumed in such Loan Party’s business
(but excluding Equipment).




          “Investment” means, as to any Person, any acquisition or investment by such Person in
another Person, whether by means of (a) the purchase or other acquisition of Equity Interests of
such other Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt
of, or purchase or other acquisition of any other debt or interest in, another Person, or (c) the
purchase or other acquisition (in one transaction or a series of transactions) of assets of such
other Person that constitute a business unit or all or a substantial part of the business of, such
Person. For purposes of covenant compliance, the amount of any Investment shall be the amount
actually invested, without adjustment for subsequent increases or decreases in the value of such
Investment, but giving effect to any return of capital or prepayments or repayments of principal
actually received by such Person with respect thereto.




          “IP Rights” has the meaning specified in Section 5.17.




          “IP Security Agreement Supplement” means a supplement delivered in connection with any
Intellectual Property Security Agreement, in each case in form and substance reasonably
satisfactory to the Administrative Agent.




          “IRS” means the United States Internal Revenue Service.




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




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




          “Junior Financing” has the meaning specified in Section 7.14.




          “Junior Financing Documentation” means any documentation governing any Junior
Financing.




          “Laws” means, collectively, all international, foreign, federal, state, provincial,
territorial, municipal and local statutes, treaties, rules, guidelines, regulations, ordinances,
codes and administrative or judicial precedents or authorities, including the interpretation or
administration thereof by any Governmental Authority charged with the enforcement, interpretation
or administration thereof, and all applicable administrative orders, directed duties, requests,
licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each
case having the force of law.




          “L/C Advance” a U.S. L/C Advance and/or a Canadian L/C Advance, as the context may
require.




          “L/C Borrowing” means a U.S. L/C Borrowing and/or a Canadian L/C Borrowing, as the
context may require.




          “L/C Credit Extension” means a U.S. L/C Credit Extension and/or a Canadian L/C Credit
Extension, as the context may require.







33









 








          “L/C Issuer” means any U.S. L/C Issuer and/or any Canadian L/C Issuer, as the context
may require.




          “L/C Obligations” means the U.S. L/C Obligations and/or the Canadian L/C Obligations,
as the context may require.




          “Lender” means a U.S. Lender and/or a Canadian Lender, as the context may require.




          “Lending Office” means, as to any Lender, the office or offices of such Lender
described as such in such Lender’s Administrative Questionnaire, or such other office or offices as
a Lender may from time to time notify the Borrowers and the Administrative Agent.




          “Letter of Credit” means a U.S. Letter of Credit and/or a Canadian Letter of Credit,
as the context may require.




          “Letter of Credit Application” means an application and agreement for the issuance or
amendment of a Letter of Credit in the form from time to time in use by an L/C Issuer.




          “Letter of Credit Expiration Date” means the day that is seven days prior to the
Maturity Date then in effect for the Revolving Credit Facility (or, if such day is not a Business
Day, the next preceding Business Day).




          “Letter of Credit Fee” has the meaning specified in Section 2.03(h).




          “Letter of Credit Sublimit” means the U.S. Letter of Credit Sublimit and/or the
Canadian Letter of Credit Sublimit, as the context may require.




          “License” means any license or agreement under which a Loan Party is authorized to use
IP Rights in connection with any manufacture, marketing, distribution or disposition of Collateral,
any use of property or any other conduct of its business.




          “Licensor” means any Person from whom a Loan Party obtains the right to use any IP
Rights.




          “Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement,
statutory or deemed trust, encumbrance, lien (statutory or other), charge, or preference, priority
or other security interest or preferential arrangement in the nature of a security interest of any
kind or nature whatsoever (including any conditional sale or other title retention agreement, any
easement, right of way or other encumbrance on title to real property, and any Capitalized Lease
having substantially the same economic effect as any of the foregoing).




          “Lien Waiver” means an agreement, in form and substance reasonably satisfactory to the
Administrative Agent, by which: (a) for any Collateral located on leased premises, the lessor
waives or subordinates any Lien it may have on the Collateral, and agrees to permit the
Administrative Agent to enter upon the premises and remove the Collateral or to use the premises
for an agreed upon period of time to store or dispose of the Collateral; (b) for any Collateral
held by a warehouseman, processor, shipper, customs broker or freight forwarder, such Person waives
or subordinates any Lien it may have on the Collateral, agrees to hold any documents in its
possession relating to the Collateral as agent for the Administrative Agent, and agrees to deliver
the Collateral to the Administrative Agent upon request; (c) for any Collateral held by a
repairman, mechanic or bailee, such Person acknowledges the Administrative Agent’s Lien, waives or
subordinates any Lien it may have on the Collateral, and agrees to






34









 







deliver the Collateral to the Administrative Agent upon request; and (d) for any Collateral subject to a
Licensor’s IP Rights, the Licensor grants to the Administrative Agent the right, vis-à-vis such
Licensor, to enforce the Administrative Agent’s Liens with respect to the Collateral, including the
right to dispose of it with the benefit of the IP Rights, whether or not a default exists under any
applicable License.




          “Loan” means a U.S. Loan and/or a Canadian Loan, as the context may require.




          “Loan Documents” means, collectively, (a) this Agreement, (b) the Notes, (c) the
Guaranties, (d) the Intercreditor Agreement, (e) the Collateral Documents, (f) the Fee Letters and
(g) each Issuer Document.




          “Loan Parties” means, collectively, each Borrower and each Guarantor.




          “Management Shareholders” means the members of management of the Specified U.S.
Borrower or its Subsidiaries who are investors, directly or indirectly, in the Specified U.S.
Borrower as of the Closing Date.




          “Mandatory Principal Payments” means all regularly scheduled principal payments or
redemptions or similar acquisitions for value of outstanding Indebtedness for borrowed money of any
Borrower or Guarantor.




          “Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect on, the operations, business, assets, properties, liabilities (actual or contingent)
or condition (financial or otherwise) of the Specified U.S. Borrower and its Subsidiaries, taken as
a whole; (b) a material impairment of the rights and remedies of the Administrative Agent or any
Lender under any Loan Document, or of the ability of the Borrowers or any Guarantor to perform its
obligations under any loan documentation to which it is a party; or (c) a material adverse effect
upon the legality, validity, binding effect or enforceability against any Borrower or any Guarantor
of any Loan Document to which it is a party; provided, that accounting adjustments that
result from “fresh start accounting” with respect to the Transactions shall not in and of itself
constitute a Material Adverse Effect hereunder; provided, further, that the
consummation of the Transactions shall not constitute a Material Adverse Effect hereunder.




          “Material Foreign Subsidiary” has the meaning specified in Section 6.12(d).




          “Material Real Estate” means any parcel of real property that is fee owned by a U.S.
Loan Party, other than any parcel of real property (i) for which the greater of the cost and the
book value is less than $2,500,000, or (ii) which property is subject to a Lien permitted by
Section 7.01(j), (q) or (w) which prohibits the granting of a Lien to the
Administrative Agent.




          “Maximum Rate” has the meaning specified in Section 11.09.




          “Maturity Date” means, with respect to each of the U.S. Revolving Credit Facility and
the Canadian Revolving Credit Facility, the earlier of (a) October 21, 2013 and (b) the date that
is 95 days before the stated maturity date (after giving effect to any extensions, renewals,
refinancings or replacements thereof) of the Senior Secured Notes; provided,
however, that if such date is not a Business Day, the Maturity Date shall be the next
preceding Business Day.




          “Measurement Period” means, at any date of determination, the most recently completed
four fiscal quarters of the Specified U.S. Borrower.







35









 








          “Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.




          “Mortgage” has the meaning specified in Section 4.01(a)(vi).




          “Mortgage Policy” has the meaning specified in Section 4.01(a)(vi)(B).




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




          “Net Cash Proceeds” means, with respect to any Disposition of ABL Priority Collateral
by any Loan Party or any of its Subsidiaries, or any Extraordinary Receipt received or paid to the
account of any Loan Party or any of its Subsidiaries, the excess, if any, of (a) the sum of cash
and Cash Equivalents received in connection with such transaction (including any cash or Cash
Equivalents received by way of deferred payment pursuant to, or by monetization of, a note
receivable or otherwise, but only as and when so received) over (b) the sum of (i) the principal
amount of any Indebtedness that is secured by the applicable asset and that is required to be
repaid in connection with such transaction (other than Indebtedness under the Loan Documents), (ii)
the reasonable and customary out-of-pocket expenses incurred by such Loan Party or such Subsidiary
in connection with such transaction and (iii) income and transfer Taxes reasonably estimated to be
actually payable within two years of the date of the relevant transaction in connection therewith
(including pursuant to any tax sharing arrangement relating to combined, consolidated, unitary or
similar tax returns to the extent that such income and transfer Taxes do not exceed the amount of
Taxes attributable to such Person and its Subsidiaries determined as if such Person and its
Subsidiaries filed separate tax returns); provided that, if the amount of any estimated
Taxes pursuant to subclause (iii) exceeds the amount of Taxes actually required to be paid
in cash in respect of such Disposition, the aggregate amount of such excess shall constitute Net
Cash Proceeds.




          “Net Income” means, with respect to any specified Person, the net income (loss) of
such Person, determined in accordance with GAAP and before any reduction in respect of preferred
stock dividends, excluding, however: (1) any gain (or loss), together with any related provision
for taxes on such gain (or loss), realized in connection with: (a) any Disposition or (b) the
disposition of any other assets by such Person or any of its Subsidiaries (other than in the
ordinary course of business) or the extinguishment of any Indebtedness of such Person or any of its
Subsidiaries; (2) any extraordinary or nonrecurring gains, losses or charges, together with any
related provision for taxes on such gain, loss or charge; (3) all adjustments resulting from “fresh
start accounting” with respect to the Transactions, including depreciation and amortization expense
and adjustments to inventory and fees and expenses and other charges paid or recorded; and (4) all
cash and non-cash restructuring charges, gains and losses of the Borrowers incurred in connection
with the Transactions, including (i) any fees, expenses or charges related to or arising from the
restructuring of the Borrowers in connection with the Cases, including, without limitation, all
fees, expenses or charges incurred or reimbursed by the Borrowers (including those of the
Borrowers, the informal committees of holders of the Borrowers’ public indebtedness, the committee
appointed to represent the interests of equity holders in the Cases, any witnesses retained by the
Borrowers in the Cases and the respective legal and financial advisors of such parties), whether
incurred in connection with the planning, negotiation, structuring or implementation of the
Approved Plan of Reorganization, and whether incurred prior to the petition date of the Cases,
during the pendency of the Cases or after the effective date of the Cases, and (ii) any severance,
relocation and transition costs, together with any related provision for Taxes on such gains,
losses, charges, fees, expenses and costs, in each case incurred in connection with the
Transactions; provided that, for the avoidance of doubt, clause (4) shall not exclude any
cash restructuring charges (including severance costs) incurred in connection





36









 







with the ongoing business of the Specified U.S. Borrower and its Subsidiaries which are not related to the
Transactions.




          “NOLV Percentage” means the net orderly liquidation value of Inventory, expressed as a
percentage, expected to be realized at an orderly, negotiated sale held within a reasonable period
of time, net of all liquidation expenses, as determined from the most recent appraisal of the Loan
Parties’ Inventory performed by an appraiser and on terms satisfactory to the Administrative Agent.




          “Non-Excluded Parties” means the Loan Parties and their Subsidiaries, in each case
excluding Excluded Subsidiaries and Foreign Subsidiaries that are not Canadian Subsidiaries.




          “Non-Extension Notice Date” has the meaning specified in Section 2.03(a)(iii).




          “Note” means a U.S. Revolving Credit Note and/or a Canadian Revolving Credit Note, as
the context may require.




          “Not Otherwise Applied” means, with reference to any amount of net cash proceeds of
any transaction or event, that such amount (a) was not required to be applied to prepay the Senior
Secured Notes and (b) was not previously applied in determining the permissibility of a transaction
(including, without limitation, the making of an Investment, Restricted Payment, capital
expenditure or refinancing of Junior Financing) under the Loan Documents where such permissibility
was (or may have been) contingent on receipt of such amount.




          “NPL” means the National Priorities List under CERCLA.




          “Obligations” means the U.S. Obligations and the Canadian Obligations.




          “OFAC” has the meaning specified in Section 5.23(b)(v).




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




          “Original Currency” has the meaning specified in Section 11.19.




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




          “Outstanding Amount” means (a) with respect to Revolving Credit Loans and Swing Line
Loans on any date, the Dollar Equivalent amount of the aggregate outstanding principal amount
thereof after giving effect to any borrowings and prepayments or repayments of Revolving Credit
Loans and Swing Line Loans, as the case may be, occurring on such date; and (b) with respect to any
L/C Obligations on any date, the Dollar Equivalent amount of such L/C Obligations on such date
after giving




37









 







effect to any L/C Credit Extension occurring on such date and any other changes in the
aggregate amount of the L/C Obligations as of such date, including as a result of any
reimbursements by a Borrower of Unreimbursed Amounts.




          “Overadvance” means a U.S. Overadvance and/or a Canadian Overadvance, as the context
may require.




          “Overadvance Loan” means a U.S. Overadvance Loan and/or a Canadian Overadvance Loan,
as the context may require.




          “Overnight Rate” means, for any day, (a) with respect to any amount denominated in
Dollars, the greater of (i) the Federal Funds Rate and (ii) an overnight rate determined by the
Administrative Agent, each applicable L/C Issuer or the applicable Swing Line Lender, as the case
may be, in accordance with banking industry rules on interbank compensation, and (b) with respect
to any amount denominated in Canadian Dollars, the rate of interest per annum at which overnight
deposits in Canadian Dollars, in an amount approximately equal to the amount with respect to which
such rate is being determined, would be offered for such day by Bank of America-Canada Branch in
the Canadian interbank market for Canadian Dollars to major banks in such interbank market.




          “Participant” has the meaning specified in Section 11.06(d).




          “Payment Item” means each check, draft or other item of payment payable to a Loan
Party, including those constituting proceeds of any Collateral.




          “PBGC” means the Pension Benefit Guaranty Corporation (or any successor).




          “Pension Plan” means any “employee pension benefit plan” (as such term is defined in
Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and
is sponsored or maintained by any Borrower or any ERISA Affiliate or to which any Borrower or any
ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time
during the immediately preceding five plan years. For greater certainty, “Pension Plan” does not
include any Canadian Pension Plan.




          “Perfection Certificate” shall mean certificates in the form of Exhibit M-1 or
any other form approved by the Administrative Agent, as the same shall be supplemented from time to
time by a Perfection Certificate Supplement or otherwise.




          “Perfection Certificate Supplement” shall mean a perfection certificate supplement in
form and substance reasonably satisfactory to the Administrative Agent.




          “Permitted Acquired Debt” has the meaning specified in Section 7.03(b)(xvii).




          “Permitted Acquisition” has the meaning specified in Section 7.02(h).




          “Permitted Encumbrances” has the meaning specified in the Mortgages.




          “Permitted Equity Issuance” means any sale or issuance of any Equity Interests (other
than Disqualified Equity Interests) of the Specified U.S. Borrower (or capital contributions in
respect thereof) to the extent permitted hereunder.




38









 








          “Permitted Refinancing” means, with respect to any Person, any modification,
amendment, restatement, amendment and restatement, refinancing, refunding, renewal or extension of
any Indebtedness of such Person; provided that (a) the principal amount (or accreted value,
if applicable) thereof does not exceed the principal amount (or accreted value, if applicable) of
the Indebtedness so modified, amended, restated, amended and restated, refinanced, refunded, renewed or extended
except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and
expenses reasonably incurred, in connection with such modification, amendment, restatement,
amendment and restatement, refinancing, refunding, renewal or extension and by an amount equal to
any existing commitments unutilized thereunder (to the extent such commitments could be drawn at
the time of such refinancing in compliance with this Agreement) or as otherwise permitted pursuant
to Section 7.03, (b) such modification, amendment, restatement, amendment and restatement,
refinancing, refunding, renewal or extension (A) has a final maturity date (i) that occurs at least
181 days after the Maturity Date or (ii) that is equal to or later than the final maturity date of
the Indebtedness being modified, amended, restated, amended and restated, refinanced, refunded,
renewed or extended, (B) has a Weighted Average Life to Maturity equal to or greater than the
Weighted Average Life to Maturity of the Indebtedness being modified, amended, restated, amended
and restated, refinanced, refunded, renewed or extended and (C) has no scheduled amortization or
payments of principal prior to 181 days after the Maturity Date or, if the Indebtedness being
modified, amended, restated, amended and restated, refinanced, refunded, renewed or extended is
subject to scheduled amortization or payments of principal, prior to any such scheduled
amortization or payments of principal, (c) if the Indebtedness being modified, amended, restated,
amended and restated, refinanced, refunded, renewed or extended is subordinated in right of payment
to the Obligations, such modification, amendment, restatement, amendment and restatement,
refinancing, refunding, renewal or extension is subordinated in right of payment to the Obligations
on terms at least as favorable to the Lenders as those contained in the documentation governing the
Indebtedness being modified, amended, restated, amended and restated, refinanced, refunded, renewed
or extended, (d) the terms and conditions (including, if applicable, as to collateral) of any such
modified, amended, restated, amended and restated, refinanced, refunded, renewed or extended
Indebtedness are not materially, taken as a whole, less favorable to the Loan Parties or the
Lenders than the terms and conditions of the Indebtedness being modified, amended, restated,
amended and restated, refinanced, refunded, renewed or extended or are on market terms for similar
issuances at the time of such modification, amendment, restatement, amendment and restatement,
refinancing, refunding, renewal or extension (as determined in the Administrative Agent’s
reasonable discretion), (e) such modification, amendment, restatement, amendment and restatement,
refinancing, refunding, renewal or extension is incurred and/or guaranteed by only the Persons who
are the obligors on the Indebtedness being modified, amended, restated, amended and restated,
refinanced, refunded, renewed or extended, and (f) at the time thereof, no Default shall have
occurred and be continuing; and provided further that, in connection with any
Permitted Refinancing with respect to which the Intercreditor Agreement is amended, supplemented or
otherwise modified, such amendments, supplements or other modifications shall be reasonably
satisfactory to the Administrative Agent.




          “Permitted Seller Notes” has the meaning specified in Section 7.03(b)(xvii).




          “Permitted Subordinated Indebtedness” means any unsecured Indebtedness of the
Specified U.S. Borrower that (a) is expressly subordinated to the prior payment in full in cash of
the Obligations on terms and conditions (i) no less favorable to the Lenders than the terms and
conditions customary for senior subordinated debt securities of comparable issuers issued in the
capital markets at such time and placed by nationally recognized investment banks, in each case as
reasonably determined by the Collateral Agents or (ii) reasonably acceptable to the Collateral
Agents, (b) will not mature prior to the date that is six months after the Maturity Date (it being
understood that such Indebtedness may have mandatory prepayment, repurchase or redemption
provisions satisfying the requirement of clause (d) of this definition), (c) has no scheduled
amortization or payments of principal prior to the Maturity Date and



39









 




(d) has covenant, default and remedy provisions no more restrictive, or mandatory prepayment, repurchase or redemption provisions
no more onerous or expansive in scope, than provisions (i) customary for senior subordinated debt
securities of comparable issuers issued in the capital markets at such time and placed by
nationally recognized investment banks, in each case as reasonably determined
by the Collateral Agents or (ii) reasonably acceptable to the Collateral Agents;
provided any such Indebtedness shall constitute Permitted Subordinated Indebtedness only if
both before and after giving effect to the issuance or incurrence thereof, no Default or Event of
Default shall have occurred and be continuing.




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




          “Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of
ERISA) established by any Borrower or, with respect to any such plan that is subject to Section 412
of the Code or Title IV of ERISA, any ERISA Affiliate. For greater certainty, “Plan” does not
include any Canadian Benefit Plan or Canadian Pension Plan.




          “Platform” has the meaning specified in Section 6.02.




          “Pledged Debt” means any pledged “Pledged Debt” defined in any Security Agreement and
all other indebtedness from time to time owed to the Loan Parties (including, without limitation,
all promissory notes or instruments, if any, evidencing such indebtedness) and required to be
pledged by the Loan Parties pursuant to the Loan Documents.




          “Pledged Equity” means any pledged “Pledged Equity” defined in any Security Agreement
and all other Equity Interests from time to time acquired, owned or held by the Loan Parties
(including, without limitation, the certificates, if any, representing such Equity Interests) and
required to be pledged by the Loan Parties pursuant to the Loan Documents.




          “PPE Financing” means any financing of equipment, Capitalized Lease or purchase money
debt, in each case that is not secured by any ABL Priority Collateral and that would be permitted
by Section 7.03(b)(vi) (but without giving effect to the proviso thereto).




          “PPSA” means the Personal Property Security Act of Ontario; provided that, if
perfection or the effect of perfection or non-perfection or the priority of any security interest
in any Collateral is governed by the PPSA as in effect in a Canadian jurisdiction other than
Ontario, or the Civil Code of Quebec, “PPSA” means the Personal Property Security Act as in effect
from time to time in such other jurisdiction or the Civil Code of Quebec, as applicable, for
purposes of the provisions hereof relating to such perfection, effect of perfection or
non-perfection or priority.




          “Protective Advance” has the meaning specified in Section 2.01(g).




          “Public Lender” has the meaning specified in Section 6.02.




          “Real Estate Collateral Deliverables” has the meaning specified in Section
4.01(a)(vi).




          “Register” has the meaning specified in Section 11.06(c).




          “Related Parties” means, with respect to any Person, such Person’s Affiliates and the
partners, directors, officers, employees, agents, trustees and advisors of such Person and of such
Person’s Affiliates.




40









 








          “Release” means disposing, discharging, injecting, spilling, leaking, leaching,
dumping, emitting, escaping, seeping, or placing into the environment.




          “Rent and Charges Reserve” means (a) with respect to the U.S. Borrowing Base, the
aggregate of (i) all past due rent and other amounts owing by a U.S. Loan Party to any landlord,
warehouseman, processor, repairman, mechanic, shipper, freight forwarder, broker or other Person
who possesses any Eligible Inventory or could assert a Lien on any Eligible Inventory and (ii) a
reserve equal to two months rent that could be payable to any such Person, unless such Person has
executed a Lien Waiver and (b) with respect to the Canadian Borrowing Base, the aggregate of (i)
all past due rent and other amounts owing by a Canadian Loan Party to any landlord, warehouseman,
processor, repairman, mechanic, shipper, freight forwarder, broker or other Person who possesses
any Eligible Inventory or could assert a Lien on any Eligible Inventory and (ii) a reserve equal to
two months rent that could be payable to any such Person, unless such Person has executed a Lien
Waiver.




          “Reportable Event” means any of the events set forth in Section 4043(c) of ERISA,
other than events for which the 30 day notice period has been waived.




          “Request for Credit Extension” means (a) with respect to a Borrowing, conversion or
continuation of Revolving Credit Loans, a Committed Loan Notice, (b) with respect to an L/C Credit
Extension, a Letter of Credit Application, and (c) with respect to a Swing Line Loan, a Swing Line
Loan Notice.




          “Required Canadian Lenders” means, as of any date of determination, Canadian Revolving
Credit Lenders holding more than 50% of the sum of the (a) Total Canadian Outstandings (with the
aggregate amount of each Canadian Revolving Credit Lender’s risk participation and funded
participation in Canadian L/C Obligations and Canadian Swing Line Loans being deemed “held” by such
Canadian Revolving Credit Lender for purposes of this definition) and (b) aggregate unused Canadian
Revolving Credit Commitments; provided that the unused Canadian Revolving Credit Commitment
of, and the portion of the Total Canadian Outstandings held or deemed held by, any Defaulting
Lender and any Affiliated Lender shall in each case be excluded for purposes of making a
determination of Required Canadian Lenders.




          “Required Initial Lenders” means the Initial Lenders holding more than 75% of the
commitments for the Facilities provided under the Commitment Letter.




          “Required Lenders” means, as of any date of determination, Lenders holding more than
50% of the sum of the (a) Total Outstandings (with the aggregate amount of each Revolving Credit
Lender’s risk participation and funded participation in L/C Obligations and Swing Line Loans being
deemed “held” by such Appropriate Lender for purposes of this definition) and (b) aggregate unused
Revolving Credit Commitments; provided that the unused Revolving Credit Commitment of, and
the portion of the Total Outstandings held or deemed held by, any Defaulting Lender and any
Affiliated Lender shall in each case be excluded for purposes of making a determination of Required
Lenders.




          “Required U.S. Lenders” means, as of any date of determination, U.S. Revolving Credit
Lenders holding more than 50% of the sum of the (a) Total U.S. Outstandings (with the aggregate
amount of each U.S. Revolving Credit Lender’s risk participation and funded participation in U.S.
L/C Obligations and U.S. Swing Line Loans being deemed “held” by such U.S. Revolving Credit Lender
for purposes of this definition) and (b) aggregate unused U.S. Revolving Credit Commitments;
provided that the unused U.S. Revolving Credit Commitment of, and the portion of the Total
U.S. Outstandings held or deemed held by, any Defaulting Lender and any Affiliated Lender shall in
each case be excluded for purposes of making a determination of Required U.S. Lenders.




41









 








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




          “Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interest of any Person or any of its
Subsidiaries, or any payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement, defeasance,
acquisition, cancellation or termination of any such Equity Interest, or on account of any return
of capital to any Person’s stockholders, partners or members (or the equivalent of any thereof), or
any option, warrant or other right to acquire any such dividend or other distribution or payment.




          “Revolving Credit Borrowing” means a U.S. Revolving Credit Borrowing and/or a Canadian
Revolving Credit Borrowing, as the context may require.




          “Revolving Credit Commitment” means a U.S. Revolving Credit Commitment and/or a
Canadian Revolving Credit Commitment, as the context may require.




          “Revolving Credit Facility” means the U.S. Revolving Credit Facility and/or the
Canadian Revolving Credit Facility, as the context may require.




          “Revolving Credit Lender” means a U.S. Revolving Credit Lender and/or a Canadian
Revolving Credit Lender, as the context may require.




          “Revolving Credit Loan” has a U.S. Revolving Credit Loan and/or a Canadian Revolving
Credit Loan, as the context may require.




          “Revolving Credit Note” means a U.S. Revolving Credit Note and/or a Canadian Revolving
Credit Note, as the context may require.




          “Royalties” means all royalties, fees, expense reimbursement and other amounts payable
by a Loan Party under a License.




          “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc., and any successor thereto.




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




          “Second Currency” has the meaning specified in Section 11.19.




          “Secured Cash Management Agreement” means any Cash Management Agreement that is
entered into by and between a Loan Party and any Cash Management Bank.




          “Secured Hedge Agreement” means any Swap Contract permitted under Article VI
or VII that is entered into by and between any Loan Party and any Hedge Bank.




          “Secured Parties” means the U.S. Secured Parties and the Canadian Secured Parties.





42











 





          “Securities Act” means the Securities Act of 1933.



          “Security Agreement” means the U.S. Security Agreement and/or the Canadian Security
Agreement, as the context may require.



          “Security Agreement Supplement” means a supplement delivered in connection with any
Security Agreement, in each case in form and substance reasonably satisfactory to the
Administrative Agent.



          “Securities Account Control Agreement” has the meaning specified in the U.S. Security
Agreement and/or the Canadian Security Agreement, as the context may require.



          “Senior Secured Notes” means the senior secured notes of the Specified U.S. Borrower
in an aggregate principal amount of up to $750,000,000 plus any additional principal amounts
thereunder arising from the capitalization of interest thereon pursuant to the Approved Plan of
Reorganization, issued pursuant to the Senior Secured Notes Documents and any exchange notes issued
in exchange therefor, in each case, pursuant to the Senior Secured Notes Indenture.



          “Senior Secured Notes Documents” means the Senior Secured Notes Indenture, the Senior
Secured Notes and all other agreements, instruments and other documents pursuant to which the
Senior Secured Notes have been or will be issued or otherwise setting forth the terms of the Senior
Secured Notes.



          “Senior Secured Notes Indenture” means the Indenture, dated as of December 17, 2009,
among the Specified U.S. Borrower, as “Issuer” and U.S. Bank National Association, as Trustee.



          “Solvent” and “Solvency” mean, with respect to any Person on any date of
determination, that on such date (a) the fair value of the property of such Person is greater than
the total amount of liabilities, including contingent liabilities, of such Person, (b) the present
fair salable 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,
(c) such Person does not intend to, and does not believe that it will, incur debts or liabilities
beyond such Person’s ability to pay such debts and liabilities as they mature, (d) 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 capital, and (e) such
Person is able to pay its debts and liabilities, contingent obligations and other commitments as
they mature in the ordinary course of business. The amount of contingent liabilities at any time
shall be computed as the amount that, in the light of all the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an actual or matured
liability.



          “Specified Issuance Proceeds” means the net cash proceeds of (a) Permitted Equity
Issuances and (b) the issuance of Permitted Subordinated Indebtedness by the Specified U.S.
Borrower, in each case held in a segregated account pending application in accordance with the
terms of this Agreement.



          “Specified U.S. Borrower” has the meaning specified in the introductory
paragraph hereto.



          “Solidary Claim” has the meaning specified in Section 9.01(c).



          “Spot Rate” has the meaning specified in Section 1.08.



43









 





          “Subordination Provisions” has the meaning specified in Section 8.01(m).



          “Subsidiary” of a Person means, with respect to any Person, (a) any corporation,
association or other business entity (other than a partnership, joint venture, or limited liability
company) of which more than 50% of the total voting power of the Equity Interests entitled (without
regard to the occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time of determination owned or controlled directly or indirectly, by
such Person or one or more of the other Subsidiaries of that Person or a combination thereof, and
(b) any partnership, joint venture or limited liability company of which (i) more than 50% of the
capital accounts, distribution rights, total equity and voting interests or general and limited
partnership interests, as applicable, are owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person or a combination thereof, whether in
the form of membership, general, special or limited partnership interests or otherwise, and
(ii) such Person or any Subsidiary of such Person is a Controlling general partner or otherwise
Controls such entity. Unless otherwise specified, all references herein to a “Subsidiary”
or “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of the Specified U.S.
Borrower.



          “Supermajority Lenders” means, as of any date of determination, Lenders holding more
than 66 2/3% of the sum of the (a) Total Outstandings (with the aggregate amount of each Revolving
Credit Lender’s risk participation and funded participation in L/C Obligations and Swing Line Loans
being deemed “held” by such Appropriate Lender for purposes of this definition) and (b) aggregate
unused Revolving Credit Commitments; provided that the unused Revolving Credit Commitment
of, and the portion of the Total Outstandings held or deemed held by, any Defaulting Lender and any
Affiliated Lender shall in each case be excluded for purposes of making a determination of
Supermajority Lenders.



          “Supplemental Collateral Agent” has the meaning specified in Section 9.05(a).



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



          “Swap Termination Value” means, in respect of any one or more Swap Contracts, after
taking into account the effect of any legally enforceable netting agreement relating to such Swap
Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and
termination value(s) determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market
value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily
available quotations provided by any recognized dealer in such Swap Contracts (which may include a
Lender or any Affiliate of a Lender).



44









 





          “Swing Line Borrowing” means a U.S. Swing Line Borrowing and/or a Canadian Swing Line
Borrowing, as the context may require.



          “Swing Line Lender” means the U.S. Swing Line Lender and/or the Canadian Swing Line
Lender, as the context may require.



          “Swing Line Loan” means a U.S. Swing Line Loan and/or a Canadian Swing Line Loan, as
the context may require.



          “Swing Line Loan Notice” means a notice of a Swing Line Borrowing pursuant to
Section 2.04(A)(b) or 2.04(B)(b), which, if in writing, shall be substantially in
the form of Exhibit B.



          “Swing Line Sublimit” means the U.S. Swing Line Sublimit and/or the Canadian Swing
Line Sublimit, as the context may require.



          “Synthetic Debt” means, with respect to any Person as of any date of determination
thereof, all obligations of such Person in respect of transactions entered into by such Person that
are intended to function primarily as a borrowing of funds (including any minority interest
transactions that function primarily as a borrowing) but are not otherwise included in the
definition of “Indebtedness” or as a liability on the consolidated balance sheet of such
Person and its Subsidiaries in accordance with GAAP.



          “Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a
so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or
possession of property (including sale and leaseback transactions), in each case, creating
obligations that do not appear on the balance sheet of such Person but which, upon the application
of any Debtor Relief Laws to such Person, would be characterized as the indebtedness of such Person
(without regard to accounting treatment).



          “Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings (including backup withholding), assessments, remittances, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax or penalties
applicable thereto.



          “Termination Event” means (a) the whole or partial withdrawal of any Canadian Loan
Party from a Canadian Pension Plan during a plan year; or (b) the filing of a notice of intent to
terminate in whole or in part a Canadian Pension Plan or the treatment of a Canadian Pension Plan
amendment as a termination or partial termination; or (c) the institution of proceedings by any
Governmental Authority to terminate in whole or in part or have a trustee appointed to administer a
Canadian Pension Plan; or (d) any other event or condition which might constitute grounds for the
termination of, winding up or partial termination or winding up or the appointment of a trustee to
administer, any Canadian Pension Plan.



          “Term Priority Collateral” means the “Noteholder First Lien Collateral” (as defined in
the Intercreditor Agreement).



          “Threshold Amount” means $25,000,000.



          “Total Borrowing Base” means the sum of the U.S. Borrowing Base and the Canadian
Borrowing Base.



          “Total Canadian Outstandings” means the aggregate Outstanding Amount of all Canadian
Loans and all Canadian L/C Obligations.



45









 





          “Total Canadian Revolving Credit Outstandings” means the aggregate Outstanding Amount
of all Canadian Revolving Credit Loans, Canadian Swing Line Loans and Canadian L/C Obligations.



          “Total Revolving Credit Outstandings” means the aggregate Outstanding Amount of all
Revolving Credit Loans, Swing Line Loans and L/C Obligations.



          “Total Outstandings” means the aggregate Outstanding Amount of all Loans and all L/C
Obligations.



          “Total U.S. Outstandings” means the aggregate Outstanding Amount of all U.S. Loans and
all U.S. L/C Obligations.



          “Total U.S. Revolving Credit Outstandings” means the aggregate Outstanding Amount of
all U.S. Revolving Credit Loans, U.S. Swing Line Loans and U.S. L/C Obligations.



          “Transactions” means, collectively, (a) the events and circumstances giving rise to,
and the commencement and administration of, the Cases, the confirmation of the Approved Plan of
Reorganization and the consummation of each of the transactions contemplated thereby to occur on
the Effective Date (as defined therein) thereof, (b) the execution and effectiveness of the Loan
Documents, (c) on the Closing Date, the making of Loans and extension of Revolving Credit
Commitments by the Lenders hereunder, (d) the repayment of all Indebtedness under the Existing
Credit Agreement and termination of all commitments thereunder, and (e) the payment of all fees,
costs and expenses in respect of, and to the extent permitted by, the foregoing.



          “Trustee” means U.S. Bank National Association, in its capacity as trustee under the
Senior Secured Notes Indenture.



          “Type” means, with respect to a Loan, its character as a Base Rate Loan, Canadian Base
Rate Loan, Canadian Prime Rate Loan, BA Rate Loan or a Eurodollar Rate Loan.



          “UCC” means the Uniform Commercial Code as in effect in the State of New York;
provided that, if perfection or the effect of perfection or non-perfection or the priority
of any security interest in any Collateral is governed by the Uniform Commercial Code as in effect
in a jurisdiction other than the State of New York, “UCC” means the Uniform Commercial Code
as in effect from time to time in such other jurisdiction for purposes of the provisions hereof
relating to such perfection, effect of perfection or non-perfection or priority.



          “United States” and “U.S.” mean the United States of America.



          “Unreimbursed Amount” has the meaning specified in Section 2.03(b)(i).



          “U.S. Account Control Agreements” means, collectively, the Control Agreements entered
into by the U.S. Loan Parties in favor of the Administrative Agent, each in form and substance
reasonably satisfactory to the Administrative Agent.



          “U.S. ABL Priority Collateral” means ABL Priority Collateral that is U.S. Collateral.



          “U.S. Available Cash” means, at any time, unrestricted cash collateral of the
Specified U.S. Borrower that (a) does not consist of proceeds of accounts receivable that are
otherwise included at such time in the calculation of the U.S. Borrowing Base and (b) is pledged to
the Administrative Agent



46









 




and held in Cash Collateral Accounts at the Administrative Agent. In no event shall any
Specified Issuance Proceeds be classified as U.S. Available Cash.




          “U.S. Borrowers” means the Specified U.S. Borrower, the Subsidiaries of the Specified
U.S. Borrower listed on the signature pages to this Agreement as “Borrowers” and each Domestic
Subsidiary that becomes a “Guarantor” hereunder after the Closing Date.



          “U.S. Borrowing Base” means, on any date of determination, an amount (calculated based
on the most recent Borrowing Base Certificate delivered to the Administrative Agent in accordance
with this Agreement) equal to:



          (a) the sum of:



          (i) 85% of the value of the Eligible Receivables of the U.S. Borrowers (other than any
Excluded Subsidiaries);



          (ii) 85% of the NOLV Percentage of the value of the Eligible Inventory of the U.S. Borrowers
(other than any Excluded Subsidiaries); and



          (iii) (x) 100% of U.S. Available Cash up to $25,000,000 (less the amount of Canadian Available
Cash included in the calculation of the Canadian Borrowing Base at such time) for purposes of
determining whether a Borrowing is permitted or (y) 100% of U.S. Available Cash up to $10,000,000
(less the amount of Canadian Available Cash included in the calculation of the Canadian Borrowing
Base at such time) for any other purpose under the Loan Documents (including, without limitation in
respect of the determination of whether a Cash Dominion Event or a Covenant Trigger Event exists or
compliance with any test set forth in Article VII);



          minus



          (b) the Availability Reserve to the extent attributable to the U.S. Borrowers in the
Collateral Agents’ Credit Judgment on such date, provided that, after the Closing Date, the
Collateral Agents may adjust the apportionment of the Availability Reserve between the U.S.
Revolving Credit Facility and the Canadian Revolving Credit Facility in their Credit Judgment.



          “U.S. Cash Management Bank” means any Person that, at the time it enters into a Cash
Management Agreement, is a U.S. Lender or an Affiliate of a U.S. Lender, in its capacity as a party
to such Cash Management Agreement, in each case in respect of services provided under such Cash
Management Agreement to a U.S. Loan Party.



          “U.S. Collateral” means all of the “Collateral” and “Mortgaged Property” referred to
in the U.S. Collateral Documents and all of the other property that is or is intended under the
terms of the U.S. Collateral Documents to be subject to Liens in favor of the Administrative Agent
for the benefit of the U.S. Secured Parties.



          “U.S. Collateral Documents” means, collectively, the U.S. Security Agreement, the U.S.
Intellectual Property Security Agreement, the Mortgages, the U.S. Account Control Agreements, each
of the mortgages, collateral assignments, Security Agreement Supplements, IP Security Agreement
Supplements, security agreements, pledge agreements or other similar agreements delivered to the
Administrative Agent pursuant to Section 6.12, and each of the other agreements,
instruments or documents that creates or purports to create a Lien in favor of the Administrative
Agent for the benefit of the U.S. Secured Parties.



47









 





          “U.S. Excess Availability” means, at any time, the difference between (a) the lesser
of (i) (A) the U.S. Revolving Credit Facility and (ii) the U.S. Borrowing Base at such time, as
determined from the most recent Borrowing Base Certificate delivered by the Borrower Agent to the
Administrative Agent pursuant to Section 6.01(f) hereof minus (b) the Total U.S.
Revolving Credit Outstandings.



          “U.S. Guaranty” means, collectively, the Guarantees made by the Specified U.S.
Borrower and the U.S. Subsidiary Guarantors in favor of the Secured Parties, substantially in the
form of Exhibit F-1, together with each other guaranty and guaranty supplement delivered
pursuant to Section 6.12.



          “U.S. Hedge Bank” means any Hedge Bank that is party to a U.S. Secured Hedge
Agreement.



          “U.S. Intellectual Property Security Agreement” has the meaning specified in
Section 4.01(a)(vii).



          “U.S. L/C Advance” means, with respect to each U.S. Revolving Credit Lender, such
Lender’s funding of its participation in any U.S. L/C Borrowing in accordance with its Applicable
Percentage.



          “U.S. L/C Borrowing” means an extension of credit resulting from a drawing under any
U.S. Letter of Credit which has not been reimbursed on the date when made or refinanced as a U.S.
Revolving Credit Borrowing.



          “U.S. L/C Credit Extension” means, with respect to any U.S. Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.



          “U.S. L/C Issuer” means Bank of America in its capacity as issuer of U.S. Letters of
Credit hereunder, any successor thereto in such capacity or any other Lender (or any Affiliate of a
Lender) that has agreed to act in such capacity.



          “U.S. L/C Obligations” means, as at any date of determination, the aggregate amount
available to be drawn under all outstanding U.S. Letters of Credit plus the aggregate of
all Unreimbursed Amounts in respect of U.S. Letters of Credit, including all U.S. L/C Borrowings.
For purposes of computing the amount available to be drawn under any U.S. Letter of Credit, the
amount of such Letter of Credit shall be determined in accordance with Section 1.07. For
all purposes of this Agreement, if on any date of determination a U.S. Letter of Credit has expired
by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14
of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining
available to be drawn.



          “U.S. Lender” means each financial institution listed on Schedule 2.01 as a
“U.S. Revolving Credit Lender”, as well as any Person that becomes a “U.S. Revolving Credit Lender”
hereunder pursuant to Section 2.16 or 11.06 and, as the context requires, includes
the U.S. Swing Line Lender.



          “U.S. Letter of Credit” means any commercial or standby letter of credit issued under
the U.S. Revolving Credit Facility and shall include the Existing Letters of Credit.



          “U.S. Letter of Credit Sublimit” means an amount equal to $60,000,000. The U.S.
Letter of Credit Sublimit is part of, and not in addition to, the U.S. Revolving Credit Facility.



48









 





          “U.S. Loan” means an extension of credit by a Lender to the Specified U.S. Borrower
under Article II in the form of a U.S. Revolving Credit Loan or a U.S. Swing Line Loan.



          “U.S. Loan Party” means any Loan Party that is organized under the laws of one of the
states of the United States of America and that is not a CFC.



          “U.S. Obligations” means all advances to, and debts, liabilities, obligations,
covenants and duties of, any U.S. Loan Party arising under any Loan Document or otherwise with
respect to any U.S. Loan, U.S. Letter of Credit, U.S. Secured Cash Management Agreement or U.S.
Secured Hedge Agreement, whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to become due, now existing or hereafter arising and including
interest and fees that accrue after the commencement by or against any U.S. Loan Party or any
Subsidiary thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor
in such proceeding, regardless of whether such interest and fees are allowed claims in such
proceeding.



          “U.S. Overadvance” has the meaning specified in Section 2.01(e).



          “U.S. Overadvance Loan” means a U.S. Revolving Credit Loan made when an Overadvance
exists or is caused by the funding thereof.



          “U.S. Payment Account” means the account of the Administrative Agent to which all
monies constituting proceeds of U.S. Collateral shall be transferred from time to time.



          “U.S. Protective Advance” has the meaning specified in Section 2.01(g).



          “U.S. Revolving Credit Borrowing” means a borrowing consisting of simultaneous U.S.
Revolving Credit Loans of the same Type and, in the case of Eurodollar Rate Loans, having the same
Interest Period made by each of the U.S. Revolving Credit Lenders.



          “U.S. Revolving Credit Commitment” means, as to each U.S. Revolving Credit Lender, its
obligation to (a) make U.S. Revolving Credit Loans to the Specified U.S. Borrower pursuant to
Section 2.01(a), (b) purchase participations in U.S. L/C Obligations, and (c) purchase
participations in U.S. Swing Line Loans, in an aggregate principal amount at any one time
outstanding not to exceed the amount set forth opposite such Lender’s name on Schedule 2.01
under the caption “U.S. Revolving Credit Commitment” or opposite such caption in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable, as such amount may
be adjusted from time to time in accordance with this Agreement; provided, that at any time
that the Total Canadian Revolving Credit Outstandings exceed 100% of the Canadian Revolving Credit
Commitments, the U.S. Revolving Credit Commitments shall be temporarily reduced by the amount of
such excess until such excess is reduced to zero.



          “U.S. Revolving Credit Exposure” means, with respect to any U.S. Revolving Credit
Lender at any time, the Outstanding Amount of such Lender’s U.S. Revolving Credit Loans
plus such Lender’s Applicable Percentage of the Outstanding Amount of U.S. L/C Obligations
with respect to U.S. Letters of Credit plus such Lender’s Applicable Percentage of the
Outstanding Amount of U.S. Swing Line Loans.



          “U.S. Revolving Credit Facility” means, at any time, the aggregate amount of the U.S.
Revolving Credit Lenders’ U.S. Revolving Credit Commitments at such time.



49









 





          “U.S. Revolving Credit Lender” means, at any time, any Lender that has a U.S.
Revolving Credit Commitment at such time.



          “U.S. Revolving Credit Loan” has the meaning specified in Section 2.01(a) and
shall be deemed to include any U.S. Overadvance Loan and U.S. Protective Advance made hereunder.



          “U.S. Revolving Credit Note” means a promissory note made by the Specified U.S.
Borrower in favor of a U.S. Revolving Credit Lender evidencing U.S. Revolving Credit Loans or U.S.
Swing Line Loans, as the case may be, made by such U.S. Revolving Credit Lender, substantially in
the form of Exhibit C-1.



          “U.S. Secured Cash Management Agreement” means any Secured Cash Management Agreement
that is entered into by and between any U.S. Loan Party and any Cash Management Bank.



          “U.S. Secured Hedge Agreement” means any Secured Hedge Agreement that is entered into
by and between any U.S. Loan Party and any Hedge Bank.



          “U.S. Secured Parties” means, collectively, the Administrative Agent, each Collateral
Agent, the U.S. Revolving Credit Lenders, each U.S. L/C Issuer, the U.S. Hedge Banks, the U.S. Cash
Management Banks, each co-agent or sub-agent appointed by the Administrative Agent from time to
time pursuant to Section 9.05, the Canadian Secured Parties and the other Persons the U.S.
Obligations owing to which are or are purported to be secured by the U.S. Collateral under the
terms of the Collateral Documents.



          “U.S. Security Agreement” means the U.S. Security Agreement substantially in the form
of Exhibit G-1 (together with each other security agreement and security agreement
supplement delivered pursuant to Section 6.12 in respect of the U.S. Collateral).



          “U.S. Subsidiary Guarantor” means each Domestic Subsidiary listed on Schedule
6.12 and each Person that shall, at any time, execute and deliver a U.S. Guaranty.



          “U.S. Swing Line Borrowing” means a borrowing of a U.S. Swing Line Loan pursuant to
Section 2.04.



          “U.S. Swing Line Lender” means Bank of America in its capacity as provider of U.S.
Swing Line Loans, or any successor swing line lender hereunder.



          “U.S. Swing Line Loan” has the meaning specified in Section 2.04(A)(a).



          “U.S. Swing Line Sublimit” means an amount equal to $20,000,000. The U.S. Swing Line
Sublimit is part of, and not in addition to, the U.S. Revolving Credit Facility.



          “Weighted Average Life to Maturity” means, when applied to any Indebtedness at any
date, the number of years obtained by dividing: (a) the sum of the products obtained by
multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or
other required payments of principal, including payment at final maturity, in respect thereof, by
(ii) the number of years (calculated to the nearest one-twelfth) that will elapse between the date
of determination and the making of each such payment; by (b) the then outstanding principal amount
of such Indebtedness.



50









 





          1.02 Other Interpretive Provisions. With reference to this Agreement and each other
Loan Document, unless otherwise specified herein or in such other Loan Document:




     (a) The definitions of terms herein shall apply equally to the singular and plural
forms of the terms defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words “include,”
“includes” and “including” shall be deemed to be followed by the phrase
“without limitation.” The word “will” shall be construed to have the same meaning
and effect as the word “shall.” Unless the context requires otherwise, (i) any
definition of or reference to any agreement, instrument or other document (including any
Organization Document) shall be construed as referring to such agreement, instrument or
other document as from time to time amended, restated, amended and restated, supplemented or
otherwise modified in accordance with the terms of the Loan Documents, (ii) any reference
herein to any Person shall be construed to include such Person’s successors and assigns,
(iii) the words “herein,” “hereof” and “hereunder,” and words of
similar import when used in any Loan Document, shall be construed to refer to such Loan
Document in its entirety and not to any particular provision thereof, (iv) all references in
a Loan Document to Articles, Sections, Preliminary Statements, Exhibits and Schedules shall
be construed to refer to Articles and Sections of, and Preliminary Statements, Exhibits and
Schedules to, the Loan Document in which such references appear, (v) any reference to any
law shall include all statutory and regulatory provisions consolidating, amending, replacing
or interpreting such law and any reference to any law or regulation shall, unless otherwise
specified, refer to such law or regulation as amended, modified or supplemented from time to
time and (vi) the words “asset” and “property” shall be construed to have
the same meaning and effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights.




     (b) All other terms contained in this Agreement shall have, when the context so
indicates, the meanings provided for by the UCC or the PPSA to the extent the same are used
or defined therein. For purposes of any Collateral located in the Province of Québec or
charged by any deed of hypothec (or any other Collateral Document) and for all other
purposes pursuant to which the interpretation or construction of a Collateral Document may
be subject to the laws of the Province of Québec or a court or tribunal exercising
jurisdiction in the Province of Québec, (i) “personal property” shall be deemed to include
“movable property,” (ii) “real property” shall be deemed to include “immovable property” and
an “easement” shall be deemed to include a “servitude,” (iii) “tangible property” shall be
deemed to include “corporeal property,” (iv) “intangible property” shall be deemed to
include “incorporeal property,” (v) “security interest” and “mortgage” shall be deemed to
include a “hypothec,” (vi) all references to filing, registering or recording financing
statements or other required documents under the UCC or the PPSA shall be deemed to include
publication under the Civil Code of Quebec, and all references to releasing any Lien shall
be deemed to include a release, discharge and mainlevee of a hypothec, (vii) all references
to “perfection” of or “perfected” Liens shall be deemed to include a reference to the
“opposability” of such Liens to third parties, (viii) any “right of offset,” “right of
setoff” or similar expression shall be deemed to include a “right of compensation”,
(ix) “goods” shall be deemed to include “corporeal movable property” other than chattel
paper, documents of title, instruments, money and securities, and (x) an “agent” shall be
deemed to include a “mandatary.”




     (c) In the computation of periods of time from a specified date to a later specified
date, the word “from” means “from and including;” the words “to” and
“until” each mean “to but excluding;” and the word “through” means
“to and including.”



51









 






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



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



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



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



          1.05 Times of Day. Unless otherwise specified, all references herein to times of day
shall be references to New York City time (daylight or standard, as applicable).



          1.06 Timing of Payment or Performance. Unless otherwise specified herein, when the
payment of any obligation or the performance of any covenant, duty or obligation is stated to be
due or performance required on a day which is not a Business Day, the date of such payment or
performance shall extend to the immediately succeeding Business Day and such extension of time
shall be reflected in computing interest or fees, as the case may be.



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



          1.08 Currency Equivalents Generally. Any amount specified in this Agreement (other
than in Articles II, IX and X) or any of the other Loan Documents to be in Dollars shall also
include the equivalent of such amount in any currency other than Dollars, such equivalent amount
thereof in the applicable currency to be determined by the Administrative Agent at such time on the
basis of the Spot Rate (as defined below) for the purchase of such currency with Dollars (including
for calculations of



52









 




Excess Availability). For purposes of this Section 1.08, the “Spot Rate” for a
currency means the rate determined by the Administrative Agent to be the rate quoted by the Person
acting in such capacity as the spot rate for the purchase by such Person of such currency with
another currency through its principal foreign exchange trading office at approximately 11:00 a.m.
on the date two Business Days prior to the date of such determination; provided that the
Administrative Agent may obtain such spot rate from another financial institution designated by the
Administrative Agent if the Person acting in such capacity does not have as of the date of
determination a spot buying rate for any such currency.




          1.09 Collateral Agents. In the event that, with respect to any matter herein or in
any other Loan Document that requires or permits a decision, exercise of discretion or other
determination by the Collateral Agents (including matters relating to Availability Reserves and
other matters affecting the calculation of any Borrowing Base), the Collateral Agents do not all
agree on such determination, the same shall reflect the determination of the Collateral Agent that
asserts the most conservative Credit Judgment on behalf of the Lenders. Any Collateral Agent may
in its sole discretion resign from acting in such capacity upon written notice to the
Administrative Agent, the other Collateral Agents (if any) and the Borrower Agent. In the event
that there shall exist no Person acting in the capacity of Collateral Agent, any references herein
and the other Loan Documents to the Collateral Agents shall be deemed to refer to the
Administrative Agent.



ARTICLE II

THE COMMITMENTS AND CREDIT EXTENSIONS




          2.01 The Loans.



          (a) U.S. Revolving Credit Borrowings. Subject to the terms and conditions set forth
herein, each U.S. Revolving Credit Lender severally agrees to make loans (each such loan, a
“U.S. Revolving Credit Loan”) in Dollars to the Specified U.S. Borrower, as Borrower Agent,
from time to time, on any Business Day during the Availability Period, in an aggregate amount not
to exceed at any time outstanding the amount of such Lender’s U.S. Revolving Credit Commitment;
provided, however, that after giving effect to any U.S. Revolving Credit Borrowing,
(i) the Total Revolving Credit Outstandings shall not exceed the lesser of (x) the Revolving Credit
Facility and (y) the Total Borrowing Base at such time, (ii) the aggregate Outstanding Amount of
the U.S. Revolving Credit Loans of any U.S. Revolving Credit Lender, plus such U.S. Revolving
Credit Lender’s Applicable Percentage of the Outstanding Amount of all U.S. L/C Obligations,
plus such U.S. Revolving Credit Lender’s Applicable Percentage of the Outstanding Amount of
all U.S. Swing Line Loans shall not exceed such U.S. Revolving Credit Lender’s U.S. Revolving
Credit Commitment and (iii) the Total U.S. Revolving Credit Outstandings shall not exceed the
lesser of (x) the U.S. Revolving Credit Facility and (y) the U.S. Borrowing Base. Within the
limits of each U.S. Revolving Credit Lender’s U.S. Revolving Credit Commitment, and subject to the
other terms and conditions hereof, the Specified U.S. Borrower may borrow under this
Section 2.01(a), prepay under Section 2.05, and reborrow under this
Section 2.01(a). U.S. Revolving Credit Loans may be Base Rate Loans or Eurodollar Rate
Loans, as further provided herein



          (b) Canadian Revolving Credit Borrowings. Subject to the terms and conditions set
forth herein, each Canadian Revolving Credit Lender severally agrees to make loans (each such loan,
a “Canadian Revolving Credit Loan”) in Dollars and Canadian Dollars to the Canadian
Borrower from time to time, on any Business Day during the Availability Period, in an aggregate
amount not to exceed at any time outstanding the amount of such Lender’s Canadian Revolving Credit
Commitment; provided, however, that after giving effect to any Canadian Revolving
Credit Borrowing, (i) the Total Revolving Credit Outstandings shall not exceed the lesser of
(x) the Revolving Credit Facility and (y) the Total Borrowing Base at such time, (ii) the aggregate
Outstanding Amount of the Canadian Revolving Credit



53









 




Loans of any Canadian Revolving Credit Lender, plus such Canadian Revolving Credit
Lender’s Applicable Percentage of the Outstanding Amount of all Canadian L/C Obligations,
plus such Canadian Revolving Credit Lender’s Applicable Percentage of the Outstanding
Amount of all Canadian Swing Line Loans shall not exceed such Canadian Revolving Credit Lender’s
Canadian Revolving Credit Commitment and (iii) the Total Canadian Revolving Credit Outstandings
shall not exceed the lesser of (x) the Canadian Revolving Credit Facility and (y) the Canadian
Borrowing Base. Within the limits of each Canadian Revolving Credit Lender’s Canadian Revolving
Credit Commitment, and subject to the other terms and conditions hereof, the Canadian Borrower may
borrow under this Section 2.01(b), prepay under Section 2.05, and reborrow under
this Section 2.01(b). Canadian Revolving Credit Loans denominated in Dollars may be
Canadian Base Rate Loans or Eurodollar Rate Loans, as further provided herein. Canadian Revolving
Credit Loans denominated in Canadian Dollars may be Canadian Prime Rate Loans or BA Rate Loans, as
further provided herein.




          (c) U.S. Letter of Credit Commitment.




     (i) Subject to the terms and conditions set forth herein, (A) each U.S. L/C Issuer
agrees, in reliance upon the agreements of the U.S. Revolving Credit Lenders set forth in
this Section 2.01(c) and Section 2.03, (1) from time to time on any Business
Day during the period from the Closing Date until the Letter of Credit Expiration Date, to
issue U.S. Letters of Credit for the account of the Specified U.S. Borrower or its
Subsidiaries, and to amend or extend U.S. Letters of Credit previously issued by it, in
accordance with Section 2.03(a), and (2) to honor drawings under the U.S. Letters of
Credit; and (B) the U.S. Revolving Credit Lenders severally agree to participate in U.S.
Letters of Credit issued for the account of the Specified U.S. Borrower or its Subsidiaries
and any drawings thereunder; provided that after giving effect to any U.S. L/C
Credit Extension with respect to any U.S. Letter of Credit, (w) the Total Revolving Credit
Outstandings shall not exceed the lesser of (I) the Revolving Credit Facility and (II) the
Total Borrowing Base at such time, (x) the aggregate Outstanding Amount of the U.S.
Revolving Credit Loans of any U.S. Revolving Credit Lender, plus such U.S. Revolving
Credit Lender’s Applicable Percentage of the Outstanding Amount of all U.S. L/C Obligations,
plus such U.S. Revolving Credit Lender’s Applicable Percentage of the Outstanding
Amount of all U.S. Swing Line Loans shall not exceed such U.S. Revolving Credit Lender’s
U.S. Revolving Credit Commitment, (y) the Total U.S. Revolving Credit Outstandings shall not
exceed the lesser of (I) the U.S. Revolving Credit Facility and (II) the U.S. Borrowing
Base, and (z) the Outstanding Amount of the U.S. L/C Obligations shall not exceed the U.S.
Letter of Credit Sublimit. Each request by the Specified U.S. Borrower for the issuance or
amendment of a U.S. Letter of Credit shall be deemed to be a representation by the Specified
U.S. Borrower that the L/C Credit Extension so requested complies with the conditions set
forth in the proviso to the preceding sentence. Within the foregoing limits, and subject to
the terms and conditions hereof, the Specified U.S. Borrower’s ability to obtain U.S.
Letters of Credit shall be fully revolving, and accordingly the Specified U.S. Borrower may,
during the foregoing period, obtain U.S. Letters of Credit to replace Letters of Credit that
have expired or that have been drawn upon and reimbursed. All Existing Letters of Credit
shall be deemed to have been issued pursuant hereto, and from and after the Closing Date
shall be subject to and governed by the terms and conditions hereof.




     (ii) No U.S. L/C Issuer shall issue any U.S. Letter of Credit if:




     (A) subject to Section 2.03(a)(iii), the expiry date of such requested Letter
of Credit would occur more than twelve months after the date of issuance or last extension,
unless the Required U.S. Lenders have approved such expiry date; or



54









 






     (B) the expiry date of such requested Letter of Credit would occur after the Letter of
Credit Expiration Date.




     (iii) No U.S. L/C Issuer shall be under any obligation to issue any U.S. Letter of
Credit if:




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




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




     (C) [reserved];




     (D) such Letter of Credit is to be denominated in a currency other than Dollars; or




     (E) a default of any U.S. Revolving Credit Lender’s obligations to fund under
Section 2.03(b) exists or any U.S. Revolving Credit Lender is at such time a
Defaulting Lender hereunder, unless such U.S. L/C Issuer has entered into reasonably
satisfactory arrangements with the Specified U.S. Borrower or such Defaulting Lender to
eliminate such U.S. L/C Issuer’s risk with respect to such Defaulting Lender.




     (iv) No U.S. L/C Issuer shall amend any Letter of Credit if such U.S. L/C Issuer would
not be permitted at such time to issue such Letter of Credit in its amended form under the
terms hereof.




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




     (vi) Each U.S. L/C Issuer shall act on behalf of the U.S. Revolving Credit Lenders with
respect to any Letters of Credit issued by it and the documents associated therewith, and
each U.S. L/C Issuer shall have all of the benefits and immunities (A) provided to the
Administrative Agent in Article IX with respect to any acts taken or omissions
suffered by such U.S. L/C Issuer in connection with Letters of Credit issued by it or
proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as
fully as if the term “Administrative Agent” as used in Article IX included such U.S.
L/C Issuer with respect to such acts or omissions, and (B) as additionally provided herein
with respect to such U.S. L/C Issuer.




     (d) Canadian Letter of Credit Commitment.



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     (i) Subject to the terms and conditions set forth herein, (A) each Canadian L/C Issuer
agrees, in reliance upon the agreements of the Canadian Revolving Credit Lenders set forth
in this Section 2.01(d) and Section 2.03, (1) from time to time on any
Business Day during the period from the Closing Date until the Letter of Credit Expiration
Date, to issue Canadian Letters of Credit for the account of the Canadian Borrower or any of
its Canadian Subsidiaries, and to amend or extend Canadian Letters of Credit previously
issued by it, in accordance with Section 2.03(a), and (2) to honor drawings under
the Canadian Letters of Credit; and (B) the Canadian Revolving Credit Lenders severally
agree to participate in Canadian Letters of Credit issued for the account of the Canadian
Borrower or any of its Canadian Subsidiaries and any drawings thereunder; provided
that after giving effect to any Canadian L/C Credit Extension with respect to any Canadian
Letter of Credit, (w) the Total Revolving Credit Outstandings shall not exceed the lesser of
(I) the Revolving Credit Facility and (II) the Total Borrowing Base at such time, (x) the
aggregate Outstanding Amount of the Canadian Revolving Credit Loans of any Canadian
Revolving Credit Lender, plus such Canadian Revolving Credit Lender’s Applicable
Percentage of the Outstanding Amount of all Canadian L/C Obligations, plus such
Canadian Revolving Credit Lender’s Applicable Percentage of the Outstanding Amount of all
Canadian Swing Line Loans shall not exceed such Canadian Revolving Credit Lender’s Canadian
Revolving Credit Commitment, (y) the Total Canadian Revolving Credit Outstandings shall not
exceed the lesser of (I) the Canadian Revolving Credit Facility and (II) the Canadian
Borrowing Base, and (z) the Outstanding Amount of the Canadian L/C Obligations shall not
exceed the Canadian Letter of Credit Sublimit. Each request by the Canadian Borrower for
the issuance or amendment of a Canadian Letter of Credit shall be deemed to be a
representation by the Canadian Borrower that the L/C Credit Extension so requested complies
with the conditions set forth in the proviso to the preceding sentence. Within the
foregoing limits, and subject to the terms and conditions hereof, the Canadian Borrower’s
ability to obtain Canadian Letters of Credit shall be fully revolving, and accordingly the
Canadian Borrower may, during the foregoing period, obtain Canadian Letters of Credit to
replace Letters of Credit that have expired or that have been drawn upon and reimbursed.




     (ii) No Canadian L/C Issuer shall issue any Canadian Letter of Credit if:




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




     (B) the expiry date of such requested Letter of Credit would occur after the Letter of
Credit Expiration Date.




     (iii) No Canadian L/C Issuer shall be under any obligation to issue any Canadian Letter
of Credit if:




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



56









 






was not applicable on the Closing Date and which such Canadian L/C Issuer in good faith
deems material to it;




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




     (C) [reserved];




     (D) such Letter of Credit is to be denominated in a currency other than Dollars or
Canadian Dollars; or




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




     (iv) No Canadian L/C Issuer shall amend any Letter of Credit if such Canadian L/C
Issuer would not be permitted at such time to issue such Letter of Credit in its amended
form under the terms hereof.




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




     (vi) Each Canadian L/C Issuer shall act on behalf of the Canadian Revolving Credit
Lenders with respect to any Letters of Credit issued by it and the documents associated
therewith, and each Canadian L/C Issuer shall have all of the benefits and immunities
(A) provided to the Administrative Agent in Article IX with respect to any acts
taken or omissions suffered by such Canadian L/C Issuer in connection with Letters of Credit
issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters
of Credit as fully as if the term “Administrative Agent” as used in Article IX
included such Canadian L/C Issuer with respect to such acts or omissions, and (B) as
additionally provided herein with respect to such Canadian L/C Issuer.



          (e) U.S. Overadvances. If the aggregate Outstanding Amount of the U.S. Revolving
Credit Loans exceed the U.S. Borrowing Base (“U.S. Overadvance”) at any time, the excess
amount shall be payable by U.S. Borrowers on demand by the Administrative Agent, but all such
excess U.S. Revolving Credit Loans shall nevertheless constitute U.S. Obligations secured by the
U.S. Collateral and entitled to all benefits of the Loan Documents. Unless its authority has been
revoked in writing by Required U.S. Lenders, the Administrative Agent may require the U.S.
Revolving Credit Lenders to honor requests for U.S. Overadvance Loans and to forbear from requiring
the U.S. Borrowers to cure a U.S. Overadvance, when no other Event of Default is known to the
Administrative Agent, as long as (i) the U.S. Overadvance does not continue for more than 90
consecutive days (and no U.S. Overadvance may exist for at least five consecutive days thereafter
before further U.S. Overadvance Loans are required), and (ii) the U.S. Overadvance is not known by
the Administrative Agent to exceed, when taken together with all Canadian Overadvances and all
Protective Advances, (x) if the U.S. Excess Availability shall be less than zero when such U.S.
Overadvance is made, $10,000,000 at any time outstanding or (y) otherwise, $15,000,000 at any time
outstanding. In no event shall U.S. Overadvance Loans be required that would cause (A) the
aggregate Outstanding Amount of the U.S. Revolving Credit Loans of any U.S.



57









 




Revolving Credit Lender, plus such U.S. Revolving Credit Lender’s Applicable
Percentage of the Outstanding Amount of all U.S. L/C Obligations, plus such U.S. Revolving
Credit Lender’s Applicable Percentage of the Outstanding Amount of all U.S. Swing Line Loans to
exceed such U.S. Revolving Credit Lender’s U.S. Revolving Credit Commitment or (B) the Total U.S.
Revolving Credit Outstandings to exceed (x) the U.S. Revolving Credit Facility minus
(y) the Availability Reserve to the extent attributable to the U.S. Loan Parties in the Collateral
Agents’ Credit Judgment at such time. Any funding of a U.S. Overadvance Loan or sufferance of a
U.S. Overadvance shall not constitute a waiver by the Administrative Agent or the Lenders of the
Event of Default caused thereby. In no event shall any Borrower or other Loan Party be deemed a
beneficiary of this Section nor authorized to enforce any of its terms. At the Administrative
Agent’s discretion, U.S. Overadvance Loans made under this Section 2.01(e) may be made in
the form of U.S. Swing Line Loans in accordance with Section 2.04(A).




          (f) Canadian Overadvances. If the aggregate Outstanding Amount of the Canadian
Revolving Credit Loans exceed the Canadian Borrowing Base (“Canadian Overadvance”) at any
time, the excess amount shall be payable by the Canadian Borrower on demand by the Administrative
Agent, but all such excess Canadian Revolving Credit Loans shall nevertheless constitute Canadian
Obligations secured by the Canadian Collateral and entitled to all benefits of the Loan Documents.
Unless its authority has been revoked in writing by the Required Canadian Lenders, the
Administrative Agent may require the Canadian Revolving Credit Lenders to honor requests for
Canadian Overadvance Loans and to forbear from requiring the Canadian Borrower to cure a Canadian
Overadvance, when no other Event of Default is known to the Administrative Agent, as long as
(i) the Canadian Overadvance does not continue for more than 90 consecutive days (and no Canadian
Overadvance may exist for at least five consecutive days thereafter before further Canadian
Overadvance Loans are required), and (ii) the Canadian Overadvance is not known by the
Administrative Agent to exceed, when taken together with all U.S. Overadvances and all Protective
Advances, (x) if the Canadian Excess Availability shall be less than zero when such Canadian
Overadvance is made, $10,000,000 at any time outstanding or (y) otherwise, $15,000,000 at any time
outstanding. In no event shall Canadian Overadvance Loans be required that would cause (A) the
aggregate Outstanding Amount of the Canadian Revolving Credit Loans of any Canadian Revolving
Credit Lender, plus such Canadian Revolving Credit Lender’s Applicable Percentage of the
Outstanding Amount of all Canadian L/C Obligations, plus such Canadian Revolving Credit
Lender’s Applicable Percentage of the Outstanding Amount of all Canadian Swing Line Loans to exceed
such Canadian Revolving Credit Lender’s Canadian Revolving Credit Commitment or (B) the Total
Canadian Revolving Credit Outstandings to exceed (x) the Canadian Revolving Credit Facility
minus (y) the Availability Reserve to the extent attributable to the Canadian Loan Parties
in the Collateral Agents’ Credit Judgment at such time. Any funding of a Canadian Overadvance Loan
or sufferance of a Canadian Overadvance shall not constitute a waiver by the Administrative Agent
or the Lenders of the Event of Default caused thereby. In no event shall any Borrower or other
Loan Party be deemed a beneficiary of this Section nor authorized to enforce any of its terms. At
the Administrative Agent’s discretion, Canadian Overadvance Loans made under this
Section 2.01(f) may be made in the form of Canadian Swing Line Loans in accordance with
Section 2.04(B).



          (g) Protective Advances. The Administrative Agent shall be authorized, in its
discretion, at any time that any conditions in Section 4.02 are not satisfied, to make U.S.
Revolving Credit Loans (any such U.S. Revolving Credit Loans made pursuant to this
Section 2.01(g), “U.S. Protective Advances”) or to cause to be made through Bank of
America-Canada Branch as its sub-agent Canadian Revolving Credit Loans (any such Canadian Revolving
Credit Loans made pursuant to this Section 2.01(g), “Canadian Protective Advances”
and, together with the U.S. Protective Advances, the “Protective Advances”) (a) in an
aggregate amount not to exceed, when taken together with all U.S. Overadvances and all Canadian
Overadvances, (x) if the U.S. Excess Availability shall be less than zero when any such U.S.
Protective Advance is made, or if the Canadian Excess Availability shall be less than zero when any
such Canadian Protective Advance is made, $10,000,000 at any time outstanding or (y)



58









 




otherwise, $15,000,000 at any time outstanding, in each case if the Administrative Agent
reasonably deems such Loans necessary or desirable to preserve or protect Collateral, or to enhance
the collectibility or repayment of Obligations; or (b) to pay any other amounts chargeable to Loan
Parties under any Loan Documents, including costs, fees and expenses. Protective Advances shall
constitute Obligations secured by the Collateral and shall be entitled to all of the benefits of
the Loan Documents. Immediately upon the making of a Protective Advance, each applicable
Appropriate Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the Administrative Agent a risk participation in such Protective Advance in an amount
equal to the product of such applicable Revolving Credit Lender’s Applicable Percentage times the
amount of such Protective Advance. The Supermajority Lenders may at any time revoke the
Administrative Agent’s authority to make further Protective Advances by written notice to the
Administrative Agent. Absent such revocation, the Administrative Agent’s determination that
funding of a Protective Advance is appropriate shall be conclusive. In no event shall Protective
Advances cause the aggregate Outstanding Amount of the Revolving Credit Loans of any Lender,
plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations,
plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans
to exceed such Lender’s Commitment.




          2.02 Borrowings, Conversions and Continuations of Loans.



          (a) Each Revolving Credit Borrowing, each conversion of Revolving Credit Loans from one Type
to the other, and each continuation of Eurodollar Rate Loans or BA Rate Loans shall be made upon
the applicable Borrower’s irrevocable notice to the Administrative Agent, which may be given by
telephone. Each such notice must be received by the Administrative Agent not later than 11:00 a.m.
(i) three Business Days prior to the requested date of any Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or BA Rate Loans or of any conversion of Eurodollar Rate
Loans or BA Rate Loans to Base Rate Loans, Canadian Base Rate Loans or Canadian Prime Rate Loans,
as the case may be, and (ii) one Business Day prior to the requested date of any Borrowing of Base
Rate Loans, Canadian Base Rate Loans or Canadian Prime Rate Loans; provided,
however, that if the applicable Borrower wishes to request Eurodollar Rate Loans or BA Rate
Loans having an Interest Period other than 30, 60, 90 or 180 days in duration as provided in the
definition of “Interest Period,” the applicable notice must be received by the Administrative Agent
not later than 11:00 a.m. four Business Days prior to the requested date of such Borrowing,
conversion or continuation, whereupon the Administrative Agent shall give prompt notice to the
Appropriate Lenders of such request and determine whether the requested Interest Period is
acceptable to all of them. Not later than 11:00 a.m., three Business Days before the requested
date of such Borrowing, conversion or continuation, the Administrative Agent shall notify the
applicable Borrower (which notice may be by telephone) whether or not the requested Interest Period
has been consented to by all the applicable Lenders. Each telephonic notice by a Borrower pursuant
to this Section 2.02(a) must be confirmed promptly by delivery to the Administrative Agent
of a written Committed Loan Notice, appropriately completed and signed by a Responsible Officer of
such Borrower. Each Borrowing of, conversion to or continuation of Eurodollar Rate Loans or BA
Rate Loans shall be in a principal amount of $5,000,000 or Cdn. $5,000,000, as applicable, or a
whole multiple of $1,000,000 or Cdn. $1,000,000, as applicable, in excess thereof. Except as
provided in Sections 2.03(b), 2.04(A)(c) and 2.04(B)(c), each Borrowing of
or conversion to Base Rate Loans, Canadian Base Rate Loans or Canadian Prime Rate Loans shall be in
a principal amount of $500,000 or Cdn. $500,000, as applicable, or a whole multiple of $100,000 or
Cdn. $100,000, as applicable, in excess thereof. Each Committed Loan Notice (whether telephonic
or written) shall specify (i) whether a Borrower is requesting a Revolving Credit Borrowing, a
conversion of Revolving Credit Loans from one Type to the other, or a continuation of Eurodollar
Rate Loans or BA Rate Loans, (ii) the requested date of the Borrowing, conversion or continuation,
as the case may be (which shall be a Business Day), (iii) the principal amount of Loans to be
borrowed, converted or continued, (iv) the Type of Loans to be borrowed or to which existing
Revolving Credit Loans are to be converted, (v) if applicable, the duration of the Interest Period
with



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respect thereto and (vi) if applicable, the currency of the Borrowing, continuation or
conversion. If a Borrower fails to specify a Type of Loan in a Committed Loan Notice or if a
Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable
Revolving Credit Loans shall be made as, or converted to, Base Rate Loans (in the case of U.S.
Revolving Credit Loans), Canadian Base Rate Loans (in the case of Canadian Revolving Credit Loans
denominated in Dollars) or Canadian Prime Rate Loans (in the case of Canadian Revolving Credit
Loans denominated in Canadian Dollars). Any such automatic conversion to Base Rate Loans, Canadian
Base Rate Loans or Canadian Prime Rate Loans shall be effective as of the last day of the Interest
Period then in effect with respect to the applicable Eurodollar Rate Loans or BA Rate Loans. If a
Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans or BA
Rate Loans in any such Committed Loan Notice, but fails to specify an Interest Period, it will be
deemed to have specified an Interest Period of 30 days. Notwithstanding anything to the contrary
herein, a Swing Line Loan may not be converted to a Eurodollar Rate Loan or a BA Rate Loan.




          (b) Following receipt of a Committed Loan Notice, the Administrative Agent shall promptly
notify each applicable Lender of the amount of its Applicable Percentage under the applicable
Facility of the applicable Revolving Credit Loans, and if no timely notice of a conversion or
continuation is provided by the applicable Borrower, the Administrative Agent shall notify each
applicable Lender of the details of any automatic conversion to Base Rate Loans, Canadian Base Rate
Loans or Canadian Prime Rate Loans, as applicable, described in Section 2.02(a). In the
case of a Revolving Credit Borrowing, each Appropriate Lender shall make the amount of its Loan
available to the Administrative Agent in immediately available funds at the Administrative Agent’s
Office not later than 3:00 p.m. on the Business Day specified in the applicable Committed Loan
Notice. Upon satisfaction of the applicable conditions set forth in Section 4.02 (and, if
such Borrowing is the initial Credit Extension, Section 4.01), the Administrative Agent
shall make all funds so received available to the applicable Borrower in like funds as received by
the Administrative Agent either by (i) crediting the account of the applicable Borrower on the
books of Bank of America with the amount of such funds or (ii) wire transfer of such funds, in each
case in accordance with instructions provided to (and reasonably acceptable to) the Administrative
Agent by the applicable Borrower; provided, however, that if, on the date a
Committed Loan Notice with respect to a Revolving Credit Borrowing is given by a Borrower, there
are L/C Borrowings outstanding under the applicable Facility, then the proceeds of such Revolving
Credit Borrowing, first, shall be applied to the payment in full of any such L/C
Borrowings, and second, shall be made available to such Borrower as provided above.



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



          (d) The Administrative Agent shall promptly notify the applicable Borrower and the applicable
Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Loans and BA
Rate Loans upon determination of such interest rate. At any time that Base Rate Loans, Canadian
Base Rate Loans or Canadian Prime Rate Loans are outstanding, the Administrative Agent shall notify
the applicable Borrower and the applicable Lenders of any change in Bank of America’s or Bank of
America – Canada Branch’s, as applicable, base rate or prime rate used in determining the Base
Rate, Canadian Base Rate or Canadian Prime Rate, as applicable, promptly following the public
announcement of such change.



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



          2.03 Letters of Credit.



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




     (i) Each Letter of Credit shall be issued or amended, as the case may be, upon the
request of the applicable Borrower delivered to the applicable L/C Issuer (with a copy to
the Administrative Agent) in the form of a Letter of Credit Application, appropriately
completed and signed by a Responsible Officer of such Borrower. Such Letter of Credit
Application must be received by the applicable L/C Issuer and the Administrative Agent not
later than 11:00 a.m. at least two Business Days (or such later date and time as the
Administrative Agent and such L/C Issuer may agree in a particular instance in their sole
discretion) prior to the proposed issuance date or date of amendment, as the case may be.
In the case of a request for an initial issuance of a Letter of Credit, such Letter of
Credit Application shall specify in form and detail reasonably satisfactory to the
applicable L/C Issuer: (A) the proposed issuance date of the requested Letter of Credit
(which shall be a Business Day); (B) the amount and currency thereof; (C) the expiry date
thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be
presented by such beneficiary in case of any drawing thereunder; (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing thereunder; (G) the
purpose and nature of the requested Letter of Credit; and (H) such other matters as the
applicable L/C Issuer may require. In the case of a request for an amendment of any
outstanding Letter of Credit, such Letter of Credit Application shall specify in form and
detail reasonably satisfactory to the applicable L/C Issuer (1) the Letter of Credit to be
amended; (2) the proposed date of amendment thereof (which shall be a Business Day); (3) the
nature of the proposed amendment; and (4) such other matters as the applicable L/C Issuer
may require. Additionally, the applicable Borrower shall furnish to the applicable L/C
Issuer and the Administrative Agent such other documents and information pertaining to such
requested Letter of Credit issuance or amendment, including any Issuer Documents, as such
L/C Issuer or the Administrative Agent may require.




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



61









 






deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the
applicable Canadian L/C Issuer a risk participation in such Canadian Letter of Credit in an
amount equal to the product of such Canadian Revolving Credit Lender’s Applicable Percentage
times the Outstanding Amount of such Letter of Credit.




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




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




     (b) Drawings and Reimbursements; Funding of Participations.




     (i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a
drawing under such Letter of Credit, the applicable L/C Issuer shall notify the applicable
Borrower and the Administrative Agent thereof. Not later than 11:00 a.m. on the date of any
payment by the applicable L/C Issuer under a Letter of Credit (each such date, an “Honor
Date”), the applicable Borrower shall reimburse such L/C Issuer through the
Administrative Agent in an amount equal to the amount of such drawing. If the applicable
Borrower fails to so reimburse such L/C Issuer by such time, the Administrative Agent shall
promptly notify each Appropriate Lender under the applicable Facility of the Honor Date, the
amount of the unreimbursed drawing (the “Unreimbursed Amount”), and the amount of
such Revolving Credit Lender’s Applicable Percentage thereof. In such event, the applicable
Borrower shall be deemed to have requested a Revolving Credit Borrowing of Base Rate Loans
(in the case of U.S. Letters of Credit) or Canadian Base Rate Loans or Canadian Prime Rate
Loans, as applicable (in the case of Canadian Letters of Credit) to be disbursed on the
Honor Date in an amount equal to the Unreimbursed Amount, without regard to the minimum and
multiples specified in Section 2.02 for the principal amount of Base Rate Loans,
Canadian Base Rate Loans or Canadian Prime Rate Loans, as applicable, but subject to the
amount of the unutilized portion of the Revolving Credit Commitments under the applicable
Facility and the conditions set forth in Section 4.02 (other



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than the delivery of a Committed Loan Notice). Any notice given by an L/C Issuer or
the Administrative Agent pursuant to this Section 2.03(b)(i) may be given by
telephone if immediately confirmed in writing; provided that the lack of such an
immediate confirmation shall not affect the conclusiveness or binding effect of such notice.
In the case of a Letter of Credit denominated in a currency other than Dollars, the
applicable Borrower shall reimburse the applicable L/C Issuer in such currency, unless
(A) such L/C Issuer (at its option) shall have specified in such notice that it will require
reimbursement in Dollars, or (B) in the absence of any such requirement for reimbursement in
Dollars, such Borrower shall have notified such L/C Issuer promptly following receipt of the
notice of drawing that such Borrower will reimburse such L/C Issuer in Dollars. In the case
of any such reimbursement in Dollars of a drawing under a Letter of Credit denominated in a
currency other than Dollars, the applicable L/C Issuer shall notify the applicable Borrower
of the Dollar Equivalent of the amount of the drawing promptly following the determination
thereof.




     (ii) Each Appropriate Lender under the applicable Facility shall upon any notice
pursuant to Section 2.03(b)(i) make funds available to the Administrative Agent for
the account of the applicable L/C Issuer at the Administrative Agent’s Office in an amount
equal to its Applicable Percentage of the Dollar Equivalent of the Unreimbursed Amount not
later than 3:00 p.m. on the Business Day specified in such notice by the Administrative
Agent, whereupon, subject to the provisions of Section 2.03(b)(iii), each
Appropriate Lender that so makes funds available shall be deemed to have made a Base Rate
Loan, Canadian Base Rate Loan or Canadian Prime Rate Loan, as applicable, to the applicable
Borrower in such amount. The Administrative Agent shall remit the funds so received to the
applicable L/C Issuer.




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




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




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



63









 






Advance shall relieve or otherwise impair the obligation of a Borrower to reimburse the
applicable L/C Issuer for the amount of any payment made by such L/C Issuer under any Letter
of Credit, together with interest as provided herein.




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




     (c) Repayment of Participations.




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




     (ii) If any payment received by the Administrative Agent for the account of an L/C
Issuer pursuant to Section 2.03(b)(i) is required to be returned under any of the
circumstances described in Section 11.05 (including pursuant to any settlement
entered into by an L/C Issuer in its discretion), each Appropriate Lender under the
applicable Facility shall pay to the Administrative Agent for the account of such L/C Issuer
its Applicable Percentage thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand to the date such amount is returned by such
Lender, at a rate per annum equal to the Overnight Rate from time to time in effect. The
obligations of the Lenders under this clause shall survive the payment in full of the
Obligations and the termination of this Agreement.



          (d) Obligations Absolute. The obligation of the Borrowers to reimburse the applicable
L/C Issuers for each drawing under each Letter of Credit and to repay each L/C Borrowing shall be
absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of
this Agreement under all circumstances, including the following:




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




     (ii) the existence of any claim, counterclaim, setoff, defense or other right that any
Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of
such Letter of Credit (or any Person for whom any such beneficiary or any such transferee
may be acting), the applicable L/C Issuer or any other Person, whether in connection with
this



64









 






Agreement, the transactions contemplated hereby or by such Letter of Credit or any
agreement or instrument relating thereto, or any unrelated transaction;




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




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




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



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



          (e) Role of L/C Issuer. Each Lender and each Borrower agrees that, in paying any
drawing under a Letter of Credit, no L/C Issuer shall have any responsibility to obtain any
document (other than any sight draft, certificates and documents expressly required by the Letter
of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document. None of the L/C Issuers, the
Administrative Agent, any of their respective Related Parties nor any correspondent, participant or
assignee of any L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in
connection herewith at the request or with the approval of the Revolving Credit Lenders under the
applicable Facility or the Required U.S. Lenders or Required Canadian Lenders, as applicable;
(ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or
(iii) the due execution, effectiveness, validity or enforceability of any document or instrument
related to any Letter of Credit or Issuer Document. Each Borrower hereby assumes all risks of the
acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit;
provided, however, that this assumption is not intended to, and shall not, preclude
such Borrowers’ pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement. None of the L/C Issuers, the Administrative Agent,
any of their respective Related Parties nor any correspondent, participant or assignee of any L/C
Issuer shall be liable or responsible for any of the matters described in clauses (i) through (v)
of Section 2.03(d); provided, however, that anything in such clauses to the
contrary notwithstanding, a Borrower may have a claim against an L/C Issuer, and such L/C Issuer
may be liable to such Borrower, to the extent, but only to the extent, of any direct, as opposed to
consequential or exemplary, damages suffered by such Borrower which such Borrower proves were
caused by such L/C Issuer’s willful misconduct or gross negligence or such L/C Issuer’s willful
failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a
sight draft and certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing, the L/C Issuers may accept
documents that appear on their face to be in order, without responsibility for further
investigation, regardless of any



65









 




notice or information to the contrary, and the L/C Issuers shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or purporting to transfer or
assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason.




          (f) Cash Collateral. Upon the request of the Administrative Agent, (i) if an L/C
Issuer has honored any full or partial drawing request under any Letter of Credit and such drawing
has resulted in an L/C Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any L/C
Obligation for any reason remains outstanding, the applicable Borrowers shall, in each case,
immediately Cash Collateralize the then Outstanding Amount of all applicable L/C Obligations.
Sections 2.05 and 8.02(c)set forth certain additional requirements to deliver Cash
Collateral hereunder. For purposes of this Section 2.03, Section 2.05 and
Section 8.02(c), “Cash Collateralize” means to pledge and deposit with or deliver
or hypothecate to the Administrative Agent, for the benefit of the applicable L/C Issuers and the
Appropriate Lenders, as collateral for the L/C Obligations, cash or deposit account balances
pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent
and the applicable L/C Issuer (which documents are hereby consented to by the Appropriate Lenders).
Derivatives of such term have corresponding meanings. Each Borrower hereby grants to the
Administrative Agent, for the benefit of the applicable L/C Issuer and the Appropriate Lenders, a
security interest in all such cash, deposit accounts and all balances therein and all proceeds of
the foregoing. Cash Collateral shall be maintained in blocked, non-interest bearing deposit
accounts at Bank of America or Bank of America – Canada Branch, as applicable. If at any time the
Administrative Agent determines that any funds held as Cash Collateral are subject to any right or
claim of any Person other than the Administrative Agent or that the total amount of such funds is
less than the aggregate Outstanding Amount of all applicable L/C Obligations, the applicable
Borrower will, forthwith upon demand by the Administrative Agent, pay to the Administrative Agent,
as additional funds to be deposited as Cash Collateral, an amount equal to the excess of (x) such
aggregate Outstanding Amount over (y) the total amount of funds, if any, then held as Cash
Collateral that the Administrative Agent determines to be free and clear of any such right and
claim. Upon the drawing of any Letter of Credit for which funds are on deposit as Cash Collateral,
such funds shall be applied, to the extent permitted under applicable Laws, to reimburse the
applicable L/C Issuer.



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



          (h) Letter of Credit Fees. The U.S. Borrowers shall pay to the Administrative Agent
for the account of each U.S. Revolving Credit Lender in accordance with its Applicable Percentage,
and the Canadian Borrower shall pay to the Administrative Agent for the account of each Canadian
Revolving Credit Lender in accordance with its Applicable Percentage, a Letter of Credit fee (the
“Letter of Credit Fee”) for each U.S. Letter of Credit or Canadian Letter of Credit, as
applicable, equal to the Applicable Rate times the daily amount available to be drawn under
such Letter of Credit. For purposes of computing the daily amount available to be drawn under any
Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with
Section 1.07. Letter of Credit Fees shall be (i) due and payable on the first Business Day
of each April, July, October and January, commencing with the first such date to occur after the
issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand
and (ii) computed on a quarterly basis in arrears. If there is any change in the Applicable Rate
during any quarter, the daily amount available to be drawn under each standby Letter of Credit
shall be computed and multiplied by the Applicable Rate separately for each period during such



66









 




quarter that such Applicable Rate was in effect. Notwithstanding anything to the contrary
contained herein, while any Event of Default exists, all Letter of Credit Fees shall accrue at the
Default Rate.




          (i) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer. The
applicable Borrower shall pay directly to the applicable L/C Issuer for its own account a fronting
fee with respect to each Letter of Credit, at the rate of 0.125% per annum, computed on the daily
amount available to be drawn under such Letter of Credit on a quarterly basis in arrears. Such
fronting fee shall be due and payable on the first Business Day of each April, July, October and
January in respect of the most recently-ended quarterly period (or portion thereof, in the case of
the first payment), commencing with the first such date to occur after the issuance of such Letter
of Credit, on the Letter of Credit Expiration Date and thereafter on demand. For purposes of
computing the daily amount available to be drawn under any Letter of Credit, the amount of such
Letter of Credit shall be determined in accordance with Section 1.07. In addition, the
applicable Borrower shall pay directly to the applicable L/C Issuer for its own account the
customary issuance, presentation, amendment and other processing fees, and other standard costs and
charges, of such L/C Issuer relating to letters of credit as from time to time in effect. Such
customary fees and standard costs and charges are due and payable on demand and are nonrefundable.



          (j) Conflict with Issuer Documents. In the event of any conflict between the terms
hereof and the terms of any Issuer Document, the terms hereof shall control.



          (k) Letters of Credit Issued for Subsidiaries. Notwithstanding that a Letter of
Credit issued or outstanding hereunder is in support of any obligations of, or is for the account
of, a Subsidiary, each applicable Borrower shall be obligated to reimburse the applicable L/C
Issuer hereunder for any and all drawings under such Letter of Credit. Each Borrower hereby
acknowledges that the issuance of Letters of Credit for the account of Subsidiaries inures to the
benefit of such Borrower, and that such Borrower’s business derives substantial benefits from the
businesses of such Subsidiaries.



          2.04 Swing Line Loans.



          (A)



          (a) The U.S. Swing Line. Subject to the terms and conditions set forth herein, the
U.S. Swing Line Lender agrees, in reliance upon the agreements of the other Lenders set forth in
this Section 2.04(A), to make loans (each such loan, a “U.S. Swing Line Loan”) in
Dollars to the Specified U.S. Borrower from time to time on any Business Day during the
Availability Period in an aggregate amount not to exceed at any time outstanding the amount of the
U.S. Swing Line Sublimit, notwithstanding the fact that such U.S. Swing Line Loans, when aggregated
with the Applicable Percentage of the Outstanding Amount of U.S. Revolving Credit Loans and U.S.
L/C Obligations of the Lender acting as U.S. Swing Line Lender, may exceed the amount of such
Lender’s U.S. Revolving Credit Commitment; provided, however, that after giving
effect to any U.S. Swing Line Loan, (i) the Total Revolving Credit Outstandings shall not exceed
the lesser of (x) the Revolving Credit Facility and (y) the Total Borrowing Base at such time,
(ii) the aggregate Outstanding Amount of the U.S. Revolving Credit Loans of any U.S. Revolving
Credit Lender, plus such U.S. Revolving Credit Lender’s Applicable Percentage of the
Outstanding Amount of all U.S. L/C Obligations, plus such U.S. Revolving Credit Lender’s
Applicable Percentage of the Outstanding Amount of all U.S. Swing Line Loans shall not exceed such
U.S. Revolving Credit Lender’s U.S. Revolving Credit Commitment and (iii) the Total U.S. Revolving
Credit Outstandings shall not exceed the lesser of (x) the U.S. Revolving Credit Facility and
(y) the U.S. Borrowing Base; and provided further that the Specified U.S. Borrower
shall not use the proceeds of any U.S. Swing Line Loan to refinance any outstanding U.S. Swing Line
Loan. Within the foregoing limits, and subject to the other terms and conditions hereof, the
Specified U.S. Borrower may



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borrow under this Section 2.04(A), prepay under Section 2.05, and reborrow
under this Section 2.04(A). Each U.S. Swing Line Loan shall bear interest only at a rate
based on the Base Rate. Immediately upon the making of a U.S. Swing Line Loan, each U.S. Revolving
Credit Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase
from the U.S. Swing Line Lender a risk participation in such U.S. Swing Line Loan in an amount
equal to the product of such U.S. Revolving Credit Lender’s Applicable Percentage times the
amount of such U.S. Swing Line Loan.




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



          (c) Refinancing of U.S. Swing Line Loans.




     (i) The U.S. Swing Line Lender at any time in its sole and absolute discretion (but at
least once per week) may request, on behalf of the Specified U.S. Borrower (which hereby
irrevocably authorizes the U.S. Swing Line Lender to so request on its behalf), that each
U.S. Revolving Credit Lender make a Base Rate Loan in an amount equal to such Lender’s
Applicable Percentage of the amount of U.S. Swing Line Loans then outstanding. Such request
shall be made in writing (which written request shall be deemed to be a Committed Loan
Notice for purposes hereof) and in accordance with the requirements of Section 2.02,
without regard to the minimum and multiples specified therein for the principal amount of
Base Rate Loans, but subject to the unutilized portion of the U.S. Revolving Credit Facility
and the conditions set forth in Section 4.02. The U.S. Swing Line Lender shall
furnish the Specified U.S. Borrower with a copy of the applicable Committed Loan Notice
promptly after delivering such notice to the Administrative Agent. Each U.S. Revolving
Credit Lender shall make an amount equal to its Applicable Percentage of the amount
specified in such Committed Loan Notice available to the Administrative Agent in immediately
available funds for the account of the U.S. Swing Line Lender at the Administrative Agent’s
Office not later than 3:00 p.m. on the day specified in such Committed Loan Notice,
whereupon, subject to Section 2.04(A)(c)(ii), each U.S. Revolving Credit Lender that
so makes funds available shall be deemed to have made a Base Rate Loan to the Specified U.S.
Borrower in such amount. The Administrative Agent shall remit the funds so received to the
U.S. Swing Line Lender.



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     (ii) If for any reason any U.S. Swing Line Loan cannot be refinanced by such a U.S.
Revolving Credit Borrowing in accordance with Section 2.04(A)(c)(i), the request
for Base Rate Loans submitted by the U.S. Swing Line Lender as set forth herein shall be
deemed to be a request by the U.S. Swing Line Lender that each of the U.S. Revolving Credit
Lenders fund its risk participation in the relevant U.S. Swing Line Loan and each U.S.
Revolving Credit Lender’s payment to the Administrative Agent for the account of the U.S.
Swing Line Lender pursuant to Section 2.04(A)(c)(i) shall be deemed payment in
respect of such participation.




     (iii) If any U.S. Revolving Credit Lender fails to make available to the Administrative
Agent for the account of the U.S. Swing Line Lender any amount required to be paid by such
Lender pursuant to the foregoing provisions of this Section 2.04(A)(c) by the time
specified in Section 2.04(A)(c)(i), the U.S. Swing Line Lender shall be entitled to
recover from such Lender (acting through the Administrative Agent), on demand, such amount
with interest thereon for the period from the date such payment is required to the date on
which such payment is immediately available to the U.S. Swing Line Lender at a rate per
annum equal to the Overnight Rate, plus any administrative, processing or similar fees
customarily charged by the U.S. Swing Line Lender in connection with the foregoing. If such
Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall
constitute such Lender’s U.S. Revolving Credit Loan included in the relevant Borrowing or
funded participation in the relevant Swing Line Loan, as the case may be. A certificate of
the U.S. Swing Line Lender submitted to any Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (iii) shall be conclusive absent
manifest error.




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




     (d) Repayment of Participations.




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




     (ii) If any payment received by the U.S. Swing Line Lender in respect of principal or
interest on any U.S. Swing Line Loan is required to be returned by the U.S. Swing Line
Lender under any of the circumstances described in Section 11.05 (including pursuant
to any settlement entered into by the U.S. Swing Line Lender in its discretion), each U.S.
Revolving Credit Lender shall pay to the U.S. Swing Line Lender its Applicable Percentage
thereof on demand of the Administrative Agent, plus interest thereon from the date
of such demand to the date such amount is returned, at a rate per annum equal to the
Overnight Rate. The Administrative Agent will make such demand upon the request of the U.S.
Swing Line Lender. The obligations of the Lenders




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under this clause shall survive the payment in full of the U.S. Obligations and
the termination of this Agreement.



          (e) Interest for Account of U.S. Swing Line Lender. The U.S. Swing Line Lender shall
be responsible for invoicing the Specified U.S. Borrower for interest on the U.S. Swing Line Loans.
Until each U.S. Revolving Credit Lender funds its Base Rate Loan or risk participation pursuant to
this Section 2.04(A) to refinance such Revolving Credit Lender’s Applicable Percentage of
any U.S. Swing Line Loan, interest in respect of such Applicable Percentage shall be solely for the
account of the U.S. Swing Line Lender.



          (f) Payments Directly to U.S. Swing Line Lender. The Specified U.S. Borrower shall
make all payments of principal and interest in respect of the U.S. Swing Line Loans directly to the
U.S. Swing Line Lender.



          (B)



          (a) The Canadian Swing Line. Subject to the terms and conditions set forth herein,
the Canadian Swing Line Lender agrees, in reliance upon the agreements of the other Lenders set
forth in this Section 2.04(B), to make loans (each such loan, a “Canadian Swing Line
Loan”) in Dollars and Canadian Dollars to the Canadian Borrower from time to time on any
Business Day during the Availability Period in an aggregate amount not to exceed at any time
outstanding the amount of the Canadian Swing Line Sublimit, notwithstanding the fact that such
Canadian Swing Line Loans, when aggregated with the Applicable Percentage of the Outstanding Amount
of Canadian Revolving Credit Loans and Canadian L/C Obligations of the Lender acting as Canadian
Swing Line Lender, may exceed the amount of such Lender’s Canadian Revolving Credit Commitment;
provided, however, that after giving effect to any Canadian Swing Line Loan,
(i) the Total Revolving Credit Outstandings shall not exceed the lesser of (x) the Revolving Credit
Facility and (y) the Total Borrowing Base at such time, (ii) the aggregate Outstanding Amount of
the Canadian Revolving Credit Loans of any Canadian Revolving Credit Lender, plus such
Canadian Revolving Credit Lender’s Applicable Percentage of the Outstanding Amount of all Canadian
L/C Obligations, plus such Canadian Revolving Credit Lender’s Applicable Percentage of the
Outstanding Amount of all Canadian Swing Line Loans shall not exceed such Canadian Revolving Credit
Lender’s Canadian Revolving Credit Commitment and (iii) the Total Canadian Revolving Credit
Outstandings shall not exceed the lesser of (x) the Canadian Revolving Credit Facility and (y) the
Canadian Borrowing Base; and provided further that the Canadian Borrower shall not
use the proceeds of any Canadian Swing Line Loan to refinance any outstanding Canadian Swing Line
Loan. Within the foregoing limits, and subject to the other terms and conditions hereof, the
Canadian Borrower may borrow under this Section 2.04(B), prepay under Section 2.05,
and reborrow under this Section 2.04(B). Each Canadian Swing Line Loan denominated in
Dollars shall bear interest only at a rate based on the Canadian Base Rate. Each Canadian Swing
Line Loan denominated in Canadian Dollars shall bear interest only at a rate based on the Canadian
Prime Rate. Immediately upon the making of a Canadian Swing Line Loan, each Canadian Revolving
Credit Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase
from the Canadian Swing Line Lender a risk participation in such Canadian Swing Line Loan in an
amount equal to the product of such Canadian Revolving Credit Lender’s Applicable Percentage
times the amount of such Canadian Swing Line Loan.



          (b) Borrowing Procedures. Each Canadian Swing Line Borrowing shall be made upon the
Canadian Borrower’s irrevocable notice to the Canadian Swing Line Lender and the Administrative
Agent, which may be given by telephone. Each such notice must be received by the Canadian Swing
Line Lender and the Administrative Agent not later than 12:00 p.m. on the requested borrowing date,
and shall specify (i) the amount and currency to be borrowed and (ii) the requested borrowing date,
which shall be a Business Day. Each such telephonic notice must be confirmed promptly



70









 




by delivery to the Canadian Swing Line Lender and the Administrative Agent of a written Swing
Line Loan Notice, appropriately completed and signed by a Responsible Officer of the Canadian
Borrower. Promptly after receipt by the Canadian Swing Line Lender of any telephonic Swing Line
Loan Notice, the Canadian Swing Line Lender will confirm with the Administrative Agent (by
telephone or in writing) that the Administrative Agent has also received such Swing Line Loan
Notice and, if not, the Canadian Swing Line Lender will notify the Administrative Agent (by
telephone or in writing) of the contents thereof. Unless the Canadian Swing Line Lender has
received notice (by telephone or in writing) from the Administrative Agent (including at the
request of any Canadian Revolving Credit Lender) prior to 2:00 p.m. on the date of the proposed
Canadian Swing Line Borrowing (A) directing the Canadian Swing Line Lender not to make such Swing
Line Loan as a result of the limitations set forth in the first proviso to the first sentence of
Section 2.04(B)(a), or (B) that one or more of the applicable conditions specified in
Article IV is not then satisfied, then, subject to the terms and conditions hereof, the
Canadian Swing Line Lender will, not later than 3:00 p.m. on the borrowing date specified in such
Swing Line Loan Notice, make the amount of its Swing Line Loan available to the Canadian Borrower.




          (c) Refinancing of Canadian Swing Line Loans.




     (i) The Canadian Swing Line Lender at any time in its sole and absolute discretion (but
at least once per week) may request, on behalf of the Canadian Borrower (which hereby
irrevocably authorizes the Canadian Swing Line Lender to so request on its behalf), that
each Canadian Revolving Credit Lender make a Canadian Base Rate Loan or Canadian Prime Rate
Loan, as applicable, in an amount equal to such Lender’s Applicable Percentage of the amount
of Canadian Swing Line Loans then outstanding. Such request shall be made in writing (which
written request shall be deemed to be a Committed Loan Notice for purposes hereof) and in
accordance with the requirements of Section 2.02, without regard to the minimum and
multiples specified therein for the principal amount of Canadian Base Rate Loans and
Canadian Prime Rate Loans, but subject to the unutilized portion of the Canadian Revolving
Credit Facility and the conditions set forth in Section 4.02. The Canadian Swing
Line Lender shall furnish the Canadian Borrower with a copy of the applicable Committed Loan
Notice promptly after delivering such notice to the Administrative Agent. Each Canadian
Revolving Credit Lender shall make an amount equal to its Applicable Percentage of the
amount specified in such Committed Loan Notice available to the Administrative Agent in
immediately available funds for the account of the Canadian Swing Line Lender at the
Administrative Agent’s Office not later than 3:00 p.m. on the day specified in such
Committed Loan Notice, whereupon, subject to Section 2.04(B)(c)(ii), each Canadian
Revolving Credit Lender that so makes funds available shall be deemed to have made a Base
Rate Loan or Canadian Prime Rate Loan, as the case may be, to the Canadian Borrower in such
amount. The Administrative Agent shall remit the funds so received to the Canadian Swing
Line Lender.




     (ii) If for any reason any Canadian Swing Line Loan cannot be refinanced by such a
Canadian Revolving Credit Borrowing in accordance with Section 2.04(B)(c)(i), the
request for Canadian Base Rate Loans or Canadian Prime Rate Loans submitted by the Canadian
Swing Line Lender as set forth herein shall be deemed to be a request by the Canadian Swing
Line Lender that each of the Canadian Revolving Credit Lenders fund its risk participation
in the relevant Canadian Swing Line Loan and each Canadian Revolving Credit Lender’s payment
to the Administrative Agent for the account of the Canadian Swing Line Lender pursuant to
Section 2.04(B)(c)(i) shall be deemed payment in respect of such participation.




     (iii) If any Canadian Revolving Credit Lender fails to make available to the
Administrative Agent for the account of the Canadian Swing Line Lender any amount required
to be paid by such Lender pursuant to the foregoing provisions of this
Section 2.04(B)(c) by the



71









 






time specified in Section 2.04(B)(c)(i), the Canadian Swing Line Lender shall
be entitled to recover from such Lender (acting through the Administrative Agent), on
demand, such amount with interest thereon for the period from the date such payment is
required to the date on which such payment is immediately available to the Canadian Swing
Line Lender at a rate per annum equal to the Overnight Rate, plus any administrative,
processing or similar fees customarily charged by the Canadian Swing Line Lender in
connection with the foregoing. If such Lender pays such amount (with interest and fees as
aforesaid), the amount so paid shall constitute such Lender’s Revolving Credit Loan included
in the relevant Borrowing or funded participation in the relevant Swing Line Loan, as the
case may be. A certificate of the Canadian Swing Line Lender submitted to any Lender
(through the Administrative Agent) with respect to any amounts owing under this
clause (iii) shall be conclusive absent manifest error.




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



          (d) Repayment of Participations.




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




     (ii) If any payment received by the Canadian Swing Line Lender in respect of principal
or interest on any Canadian Swing Line Loan is required to be returned by the Canadian Swing
Line Lender under any of the circumstances described in Section 11.05 (including
pursuant to any settlement entered into by the Canadian Swing Line Lender in its
discretion), each Canadian Revolving Credit Lender shall pay to the Canadian Swing Line
Lender its Applicable Percentage thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand to the date such amount is returned, at a rate
per annum equal to the Canadian Prime Rate. The Administrative Agent will make such demand
upon the request of the Canadian Swing Line Lender. The obligations of the Lenders under
this clause shall survive the payment in full of the Canadian Obligations and the
termination of this Agreement.



          (e) Interest for Account of Canadian Swing Line Lender. The Canadian Swing Line
Lender shall be responsible for invoicing the Canadian Borrower for interest on the Canadian Swing
Line Loans. Until each Canadian Revolving Credit Lender funds its Canadian Base Rate Loan or
Canadian Prime Rate Loan, as the case may be, or risk participation pursuant to this
Section 2.04(B) to refinance such Revolving Credit Lender’s Applicable Percentage of any
Canadian Swing Line Loan, interest in respect of such Applicable Percentage shall be solely for the
account of the Canadian Swing Line Lender.




72












 





          (f) Payments Directly to Canadian Swing Line Lender. The Canadian Borrower shall
make all payments of principal and interest in respect of the Canadian Swing Line Loans directly to
the Canadian Swing Line Lender.




          2.05 Prepayments. (a) Optional.





     (i) Subject to the last sentence of this Section 2.05(a)(i), the Borrowers may,
upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay
Revolving Credit Loans in whole or in part without premium or penalty; provided that
(A) such notice must be received by the Administrative Agent not later than 11:00 a.m.
(1) three Business Days prior to any date of prepayment of Eurodollar Rate Loans or BA Rate
Loans and (2) one Business Day prior to any date of prepayment of Base Rate Loans, Canadian
Base Rate Loans and Canadian Prime Rate Loans; (B) any prepayment of Eurodollar Rate Loans
or BA Rate Loans shall be in a principal amount of $5,000,000 or Cdn. $5,000,000, as
applicable, or a whole multiple of $1,000,000 or Cdn. $1,000,000, as applicable, in excess
thereof; and (C) any prepayment of Base Rate Loans, Canadian Base Rate Loans and Canadian
Prime Rate Loans shall be in a principal amount of $500,000 or Cdn. $500,000, as applicable,
or a whole multiple of $100,000 or Cdn. $100,000, as applicable, in excess thereof or, in
each case, if less, the entire principal amount thereof then outstanding. Each such notice
shall specify the date and amount of such prepayment and the Type(s) of Loans to be prepaid
and, if Eurodollar Rate Loans or BA Rate Loans are to be prepaid, the Interest Period(s) of
such Loans. The Administrative Agent will promptly notify each Appropriate Lender of its
receipt of each such notice, and of the amount of such Lender’s ratable portion of such
prepayment (based on such Lender’s Applicable Percentage in respect of the relevant
Facility). If such notice is given by a Borrower, such Borrower shall make such prepayment
and the payment amount specified in such notice shall be due and payable on the date
specified therein. Any prepayment of a Eurodollar Rate Loan or a BA Rate Loan shall be
accompanied by all accrued interest on the amount prepaid, together with any additional
amounts required pursuant to Section 3.05.




     (ii) The applicable Borrower may, upon notice to the applicable Swing Line Lender (with
a copy to the Administrative Agent), at any time or from time to time, voluntarily prepay
Swing Line Loans in whole or in part without premium or penalty; provided that
(A) such notice must be received by the applicable Swing Line Lender and the Administrative
Agent not later than 12:00 p.m. on the date of the prepayment. Each such notice shall
specify the date and amount of such prepayment. If such notice is given by a Borrower, such
Borrower shall make such prepayment and the payment amount specified in such notice shall be
due and payable on the date specified therein.




     (b) Mandatory.




     (i) If the Specified U.S. Borrower or any of its Domestic Subsidiaries directly or
indirectly Disposes of any property comprising U.S. ABL Priority Collateral pursuant to
Sections 7.05(l) or (o) which results in the realization by such Person of
Net Cash Proceeds, the Borrowers shall prepay an aggregate principal amount of Revolving
Credit Loans and Cash Collateralize L/C Obligations equal to the lesser of (x) 100% of such
Net Cash Proceeds and (y) Total Outstandings, within two (2) Business Days of receipt
thereof by such Person (such prepayments to be applied as set forth in clause (xi)
below.




     (ii) If the Specified U.S. Borrower or any of its Subsidiaries directly or indirectly
Disposes of any property pursuant to Sections 7.05(l) or (o) comprising
Canadian ABL Priority Collateral which results in the realization by such Person of Net Cash
Proceeds, the Canadian



73









 






Borrower shall prepay an aggregate principal amount of Canadian Revolving Credit Loans
and Cash Collateralize Canadian L/C Obligations equal to the lesser of (x) 100% of such Net
Cash Proceeds and (y) Total Canadian Outstandings, within two (2) Business Days of receipt
thereof by such Person (such prepayments to be applied as set forth in clause (xi)
below).




     (iii) Upon any Extraordinary Receipt received by or paid to or for the account of the
Specified U.S. Borrower or any of its Domestic Subsidiaries in respect of U.S. ABL Priority
Collateral, and not otherwise included in clause (i) of this Section 2.05(b), the
Borrowers shall prepay an aggregate principal amount of Revolving Credit Loans and Cash
Collateralize L/C Obligations equal to the lesser of (x) 100% of such Net Cash Proceeds and
(y) Total Outstandings, within two (2) Business Days of receipt thereof by the Specified
U.S. Borrower or such Subsidiary (such prepayments to be applied as set forth in
clause (xi) below).




     (iv) Upon any Extraordinary Receipt received by or paid to or for the account of the
Specified U.S. Borrower or any of its Subsidiaries in respect of Canadian ABL Priority
Collateral, and not otherwise included in clause (ii) of this Section 2.05(b), the
Canadian Borrower shall prepay an aggregate principal amount of Canadian Revolving Credit
Loans and Cash Collateralize Canadian L/C Obligations equal to the lesser of (x) 100% of
such Net Cash Proceeds and (y) Total Canadian Outstandings, within two (2) Business Days of
receipt thereof by the Specified U.S. Borrower or such Subsidiary (such prepayments to be
applied as set forth in clause (xi) below).




     (v) If for any reason the Total Revolving Credit Outstandings at any time exceed the
lesser of (x) the Borrowing Base at such time (except as a result of Overadvance Loans or
Protective Advances permitted under Sections 2.01(e), (f) and (g))
and (y) the Revolving Credit Facility at such time, the Borrowers shall immediately prepay
their respective Revolving Credit Loans, Swing Line Loans and L/C Borrowings and/or Cash
Collateralize their respective L/C Obligations (other than the L/C Borrowings) in an
aggregate amount equal to such excess. If for any reason the Total U.S. Revolving Credit
Outstandings at any time exceed the lesser of (x) the U.S. Borrowing Base at such time
(except to the extent constituting U.S. Overadvance Loans permitted under
Section 2.01(e) or U.S. Protective Advances permitted under Section 2.01(g))
and (y) the U.S. Revolving Credit Facility at such time, the U.S. Borrowers shall
immediately prepay U.S. Revolving Credit Loans, U.S. Swing Line Loans and U.S. L/C
Borrowings and/or Cash Collateralize the U.S. L/C Obligations (other than the U.S. L/C
Borrowings) in an aggregate amount equal to such excess. If for any reason the Total
Canadian Revolving Credit Outstandings at any time exceed the lesser of (x) the Canadian
Borrowing Base at such time (except to the extent constituting Canadian Overadvance Loans
permitted under Section 2.01(f) or Canadian Protective Advances permitted under
Section 2.01(g)) and (y) the Canadian Revolving Credit Facility at such time, the
Canadian Borrower shall immediately prepay Canadian Revolving Credit Loans, Canadian Swing
Line Loans and Canadian L/C Borrowings and/or Cash Collateralize the Canadian L/C
Obligations (other than the Canadian L/C Borrowings) in an aggregate amount equal to such
excess.




     (vi) If, as a result of any negative fluctuations in the Dollar Equivalent of Canadian
Dollars (or other foreign currencies in which outstanding Letters of Credit may be
denominated), the Total Canadian Revolving Credit Outstandings exceeds 110% of the aggregate
amount of the Canadian Revolving Credit Commitments as then in effect, the Canadian Borrower
shall, if requested (through the Administrative Agent) by the Required Canadian Lenders
prepay the Canadian Revolving Credit Loans (or Cash Collateralize the Canadian Letters of
Credit) within three (3) Business Days following such Borrower’s receipt of such request in
such amounts as



74









 






shall be necessary so that after giving effect thereto the Total Canadian Revolving
Credit Outstandings does not exceed the Canadian Revolving Credit Commitments.




     (vii) If for any reason the aggregate Outstanding Amount of the U.S. Revolving Credit
Loans of any U.S. Revolving Credit Lender (including, for this purpose, such Lender’s
Applicable Percentage of the aggregate Outstanding Amount of all U.S. Overadvance Loans and
all U.S. Protective Advances), plus such U.S. Revolving Credit Lender’s Applicable
Percentage of the Outstanding Amount of all U.S. L/C Obligations, plus such U.S.
Revolving Credit Lender’s Applicable Percentage of the Outstanding Amount of all U.S. Swing
Line Loans exceed such U.S. Revolving Credit Lender’s U.S. Revolving Credit Commitment, the
U.S. Borrowers shall immediately prepay U.S. Revolving Credit Loans, U.S. Swing Line Loans
and U.S. L/C Borrowings and/or Cash Collateralize the U.S. L/C Obligations (other than the
U.S. L/C Borrowings) in an aggregate amount equal to such excess.




     (viii) If for any reason the aggregate Outstanding Amount of the Canadian Revolving
Credit Loans of any Canadian Revolving Credit Lender (including, for this purpose, such
Lender’s Applicable Percentage of the aggregate Outstanding Amount of all Canadian
Overadvance Loans and all Canadian Protective Advances), plus such Canadian
Revolving Credit Lender’s Applicable Percentage of the Outstanding Amount of all Canadian
L/C Obligations, plus such Canadian Revolving Credit Lender’s Applicable Percentage
of the Outstanding Amount of all Canadian Swing Line Loans exceed such Canadian Revolving
Credit Lender’s Canadian Revolving Credit Commitment, the Canadian Borrower shall
immediately prepay Canadian Revolving Credit Loans, Canadian Swing Line Loans and Canadian
L/C Borrowings and/or Cash Collateralize the Canadian L/C Obligations (other than the
Canadian L/C Borrowings) in an aggregate amount equal to such excess.




     (ix) If for any reason the aggregate Outstanding Amount of the Revolving Credit Loans
of any Lender (including, for this purpose, such Lender’s Applicable Percentage of the
aggregate Outstanding Amount of all Overadvance Loans and all Protective Advances),
plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C
Obligations, plus such Lender’s Applicable Percentage of the Outstanding Amount of
all Swing Line Loans exceed such Lender’s Commitment, then in each case the Borrowers shall
immediately prepay Revolving Credit Loans, Swing Line Loans and L/C Borrowings and/or Cash
Collateralize the L/C Obligations (other than the L/C Borrowings) in an aggregate amount
equal to such excess.




     (x) (A) If any U.S. Overadvance Loan shall remain outstanding for 90 consecutive days,
the U.S. Borrowers shall immediately prepay such U.S. Overadvance Loan and (B) if any
Canadian Overadvance Loan shall remain outstanding for 90 consecutive days, the Canadian
Borrower shall immediately prepay such Canadian Overadvance Loan.




     (xi) Prepayments of each Revolving Credit Facility made pursuant to this
Section 2.05(b) shall be applied as follows:




     (A) with respect to prepayments resulting from any Disposition of, or the
receipt of any Extraordinary Receipts in respect of, any U.S. ABL Priority
Collateral, such prepayments, first, shall be applied ratably to pay accrued
and unpaid interest in respect of the outstanding U.S. L/C Borrowings and the
outstanding U.S. Swing Line Loans (including U.S. Overadvance Loans and U.S.
Protective Advances) then being prepaid, second, shall be applied ratably to
prepay the principal of any U.S. Overadvance Loans and U.S. Protective Advances, if
any, third, shall be applied ratably to the outstanding U.S. Revolving
Credit Loans (including Swing Line Loans), and, fourth,



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shall be used to Cash Collateralize the remaining U.S. L/C Obligations; and the
amount remaining, if any, after the prepayment in full of all U.S. L/C Borrowings,
U.S. Swing Line Loans and U.S. Revolving Credit Loans outstanding at such time and
the Cash Collateralization of the remaining U.S. L/C Obligations in full, in each
case under the U.S. Revolving Credit Facility, shall be applied to the Canadian
Revolving Credit Facility, in the order set forth in Section 2.05(b)(xi)(B);
and thereafter, the amount remaining, if any, after the prepayment in full of all
L/C Borrowings, Swing Line Loans and Revolving Credit Loans outstanding at such
time, and the Cash Collateralization of the remaining L/C Obligations in full under
each Revolving Credit Facility, may be retained by the Borrowers for use in the
ordinary course of its business; provided that, upon the drawing of any
Letter of Credit that has been Cash Collateralized, the funds held as Cash
Collateral shall be applied (without any further action by or notice to or from any
Borrower or any other Loan Party) to reimburse the applicable L/C Issuer or the
applicable Revolving Credit Lenders, as applicable; and




     (B) with respect to prepayments resulting from any Disposition of, or the
receipt of any Extraordinary Receipts in respect of, any Canadian ABL Priority
Collateral, such prepayments, first, shall be applied ratably to pay accrued
and unpaid interest in respect of the outstanding Canadian L/C Borrowings and the
outstanding Canadian Swing Line Loans (including Canadian Overadvance Loans and
Canadian Protective Advances) then being prepaid, second, shall be applied
ratably to prepay the principal of any Canadian Overadvance Loans and Canadian
Protective Advances, if any, third, shall be applied ratably to the
outstanding Canadian Revolving Credit Loans (including Swing Line Loans), and,
fourth, shall be used to Cash Collateralize the remaining Canadian L/C
Obligations; and the amount remaining, if any, after the prepayment in full of all
Canadian L/C Borrowings, Canadian Swing Line Loans and Canadian Revolving Credit
Loans outstanding at such time and the Cash Collateralization of the remaining
Canadian L/C Obligations in full, in each case under the Canadian Revolving Credit
Facility, may be retained by the Canadian Borrower for use in the ordinary course of
its business; provided that, upon the drawing of any Letter of Credit that
has been Cash Collateralized, the funds held as Cash Collateral shall be applied
(without any further action by or notice to or from any Borrower or any other Loan
Party) to reimburse the applicable L/C Issuer or the applicable Revolving Credit
Lenders, as applicable.



          (c) Anything contained in Section 2.05(b) to the contrary notwithstanding, (i) if,
following the occurrence of any “Asset Sale” (as such term or any similar term is defined
in any Junior Financing Document) by any Loan Party or any of its Subsidiaries, any Loan Party or
Subsidiary is required to commit by a particular date (a “Commitment Date”) to apply or
cause its Subsidiaries to apply an amount equal to any of the “Net Proceeds” (as such term
or any similar term is defined in the applicable Junior Financing Document) thereof in a particular
manner, or to apply by a particular date (an “Application Date”) an amount equal to any
such “Net Proceeds” in a particular manner, in either case in order to excuse such Loan
Party or Subsidiary from being required to make an “Asset Sale Offer” (as such term or any
similar term is defined in the applicable Junior Financing Document) in connection with such
“Asset Sale”, and such Loan Party or Subsidiary shall have failed to so commit or to so
apply an amount equal to such “Net Proceeds” at least 60 days before the applicable
Commitment Date or Application Date, as the case may be, or (ii) if any Loan Party or Subsidiary at
any other time shall have failed to apply or commit or cause to be applied an amount equal to any
such “Net Proceeds”, and, within 60 days thereafter assuming no further application or
commitment of an amount equal to such “Net Proceeds” any Loan Party or Subsidiary would
otherwise be required to make an “Asset Sale Offer” in respect thereof, then in either such
case, to the extent permitted by any such Junior Financing Document,






76









 







the Specified U.S. Borrower shall immediately pay or cause to be paid to the Administrative
Agent an amount equal to such “Net Proceeds” to be applied to the payment of the Loans and
L/C Borrowings and to Cash Collateralize the remaining L/C Obligations under the Facility or
Facilities to which such property relates, in the manner set forth in Section 2.05(b) in
such amounts as shall excuse such Loan Party or Subsidiary from making any such “Asset Sale
Offer”. This Section 2.05(c) is subject in all respects, insofar as it relates to the
Term Priority Collateral, to the Intercreditor Agreement and the rights of the holders of the
Senior Secured Notes.




          2.06 Termination or Reduction of Commitments.




          (a) Optional. The Specified U.S. Borrower may, upon notice to the Administrative
Agent, terminate the U.S. Revolving Credit Facility, the U.S. Letter of Credit Sublimit, the U.S.
Swing Line Sublimit, or from time to time permanently reduce the U.S. Revolving Credit Facility,
the U.S. Letter of Credit Sublimit, or the U.S. Swing Line Sublimit; and the Canadian Borrower may,
upon notice to the Administrative Agent, terminate the Canadian Revolving Credit Facility, the
Canadian Letter of Credit Sublimit or the Canadian Swing Line Sublimit, or from time to time
permanently reduce the Canadian Revolving Credit Facility, the Canadian Letter of Credit Sublimit
or the Canadian Swing Line Sublimit provided that (i) any such notice shall be received by
the Administrative Agent not later than 11:00 a.m. five Business Days prior to the date of
termination or reduction, (ii) any such partial reduction shall be, (A) in the case of the Canadian
Swing Line Sublimit and the Canadian Letter of Credit Sublimit, in an aggregate amount of
$1,000,000 or any whole multiple of $1,000,000 in excess thereof, (B) in the case of the U.S. Swing
Line Sublimit, in an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess
thereof and (C) in other cases, in an aggregate amount of $10,000,000 or any whole multiple of
$1,000,000 in excess thereof and (iii) the Borrowers shall not terminate or reduce (A) the U.S.
Revolving Credit Facility if, after giving effect thereto and to any concurrent prepayments
hereunder, the Total U.S. Revolving Credit Outstandings would exceed the U.S. Revolving Credit
Facility, (B) the U.S. Letter of Credit Sublimit if, after giving effect thereto, the Outstanding
Amount of U.S. L/C Obligations not fully Cash Collateralized hereunder would exceed the U.S. Letter
of Credit Sublimit, (C) the U.S. Swing Line Sublimit if, after giving effect thereto and to any
concurrent prepayments hereunder, the Outstanding Amount of U.S. Swing Line Loans would exceed the
U.S. Swing Line Sublimit, (D) the Canadian Revolving Credit Facility if, after giving effect
thereto and to any concurrent prepayments hereunder, the Total Canadian Revolving Credit
Outstandings would exceed the Canadian Revolving Credit Facility, (E) the Canadian Letter of Credit
Sublimit if, after giving effect thereto, the Outstanding Amount of Canadian L/C Obligations not
fully Cash Collateralized hereunder would exceed the Canadian Letter of Credit Sublimit, (E) the
Canadian Swing Line Sublimit if, after giving effect thereto and to any concurrent prepayments
hereunder, the Outstanding Amount of Canadian Swing Line Loans would exceed the Canadian Swing Line
Sublimit or (F) the U.S. Revolving Credit Facility while the Canadian Revolving Credit Facility
remains in effect.




          (b) Mandatory.





     (i) If after giving effect to any reduction or termination of U.S. Revolving Credit
Commitments under this Section 2.06, the U.S. Letter of Credit Sublimit or the U.S.
Swing Line Sublimit exceeds the U.S. Revolving Credit Facility at such time, the U.S. Letter
of Credit Sublimit and/or the U.S. Swing Line Sublimit, as the case may be, shall be
automatically reduced by the amount of such excess.




     (ii) If after giving effect to any reduction or termination of Canadian Revolving
Credit Commitments under this Section 2.06, the Canadian Letter of Credit Sublimit
or the Canadian Swing Line Sublimit exceeds the Canadian Revolving Credit Facility at such
time, the



77









 






Canadian Letter of Credit Sublimit and/or the Canadian Swing Line Sublimit, as the case
may be, shall be automatically reduced by the amount of such excess.



          (c) Application of Commitment Reductions; Payment of Fees. The Administrative Agent
will promptly notify the Appropriate Lenders of any termination or reduction of any Letter of
Credit Sublimit, any Swing Line Sublimit or any Revolving Credit Commitment under this
Section 2.06. Upon any reduction of the Revolving Credit Commitments, the Revolving Credit
Commitment of each Appropriate Lender shall be reduced by such Lender’s Applicable Percentage of
such reduction amount. All fees in respect of the applicable Revolving Credit Facility accrued
until the effective date of any termination of such Revolving Credit Facility shall be paid on the
effective date of such termination.




          2.07 Repayment of Loans.




          (a) Revolving Credit Loans. The U.S. Borrowers shall repay to the U.S. Revolving
Credit Lenders on the Maturity Date for the U.S. Revolving Credit Facility the aggregate principal
amount of all U.S. Revolving Credit Loans outstanding on such date. The Canadian Borrower shall
repay to the Canadian Revolving Credit Lenders on the Maturity Date for the Canadian Revolving
Credit Facility the aggregate principal amount of all Canadian Revolving Credit Loans outstanding
on such date.




          (b) Swing Line Loans. The U.S. Borrowers shall repay each U.S. Swing Line Loan on the
earlier to occur of (i) the date ten Business Days after such Loan is made and (ii) the Maturity
Date for the U.S. Revolving Credit Facility. The Canadian Borrower shall repay each Canadian Swing
Line Loan on the earlier to occur of (i) the date ten Business Days after such Loan is made and
(ii) the Maturity Date for the Canadian Revolving Credit Facility.




          2.08 Interest.




          (a) Subject to the provisions of Section 2.08(b), (i) each Eurodollar Rate Loan under
a Facility shall bear interest on the outstanding principal amount thereof for each Interest Period
at a rate per annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate;
(ii) each BA Rate Loan under the Canadian Revolving Credit Facility shall bear interest on the
outstanding principal amount thereof for each Interest Period at a rate per annum equal to the BA
Rate for such Interest Period plus the Applicable Rate; (iii) each Base Rate Loan under a Facility
shall bear interest on the outstanding principal amount thereof from the applicable borrowing date
at a rate per annum equal to the Base Rate plus the Applicable Rate; (iv) each Canadian Base Rate
Loan under the Canadian Revolving Credit Facility shall bear interest on the outstanding principal
amount thereof from the applicable borrowing date at a rate per annum equal to the Canadian Base
Rate plus the Applicable Rate; (v) each Canadian Prime Rate Loan under the Canadian Revolving
Credit Facility shall bear interest on the outstanding principal amount thereof from the applicable
borrowing date at a rate per annum equal to the Canadian Prime Rate plus the Applicable Rate;
(vi) each U.S. Swing Line Loan shall bear interest on the outstanding principal amount thereof from
the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate
for Base Rate Loans; and (vii) each Canadian Swing Line Loan shall bear interest on the outstanding
principal amount thereof from the applicable borrowing date at a rate per annum equal to the
Canadian Base Rate (for Canadian Swing Line Loans denominated in Dollars) or the Canadian Prime
Rate (for Canadian Swing Line Loans denominated in Canadian Dollars) plus the Applicable Rate for
Canadian Base Rate Loans or Canadian Prime Rate Loans, as applicable.




          (b)





     (i) Upon the occurrence and during the continuation of any Event of Default under
Section 8.01(a), (b) (as a result of any breach of any provision contained in Article VII),
(f) or (g),



78









 






the Borrowers shall pay interest on the principal amount of all outstanding Obligations
hereunder at a fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.




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



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




          2.09 Fees. In addition to certain fees described in Sections 2.03(h) and
(i):




          (a) Commitment Fee. The U.S. Borrowers shall pay to the Administrative Agent for the
account of each U.S. Revolving Credit Lender in accordance with its Applicable Percentage, a
commitment fee equal to the Applicable Commitment Fee Rate divided by three hundred and
sixty-five (365) days and multiplied by the number of days in the fiscal quarter and then
multiplied by the amount, if any, by which the Average Revolving Credit Facility Balance
with respect to the U.S. Revolving Credit Facility for such fiscal quarter (or portion thereof that
the U.S. Revolving Credit Commitments are in effect) is less than the Average U.S. Revolving Credit
Commitments outstanding during such period; provided that, if the aggregate U.S. Revolving
Credit Commitments are terminated in full on a day other than the first day of a fiscal quarter,
then any such fee payable for the fiscal quarter in which termination shall occur shall be paid on
the effective date of such termination and shall be based upon the number of days that have elapsed
during such period; and provided further that, with respect to the fiscal quarter
in which the Closing Date occurs, any such fee payable for such fiscal quarter shall be based upon
the number of days that have elapsed during the period from the Closing Date through the end of
such fiscal quarter. The Canadian Borrower shall pay to the Administrative Agent for the account
of each Canadian Revolving Credit Lender in accordance with its Applicable Percentage, a commitment
fee equal to the Applicable Commitment Fee Rate divided by three hundred and sixty-five
(365) days and multiplied by the number of days in the fiscal quarter and then
multiplied by the amount, if any, by which the Average Revolving Credit Facility Balance
with respect to the Canadian Revolving Credit Facility for such fiscal quarter (or portion thereof
that the Canadian Revolving Credit Commitments are in effect) is less than the Average Canadian
Revolving Credit Commitments outstanding during such period; provided that, if the
aggregate Canadian Revolving Credit Commitments are terminated in full on a day other than the
first day of a fiscal quarter, then any such fee payable for the fiscal quarter in which
termination shall occur shall be paid on the effective date of such termination and shall be based
upon the number of days that have elapsed during such period; and provided further
that, with respect to the fiscal quarter in which the Closing Date occurs, any such fee payable for
such fiscal quarter shall be based upon the number of days that have elapsed during the period from
the Closing Date through the end of such fiscal quarter. The commitment fees shall be due and
payable quarterly in arrears on the first Business Day of each April, July, October and January,
commencing with the first such date to occur after the Closing Date, on the last day of the
Availability Period for the Revolving Credit Facility (and, if applicable, thereafter on demand).
The commitment fee shall be calculated quarterly in arrears and if there is any change in the
Applicable Commitment Fee Rate during any quarter, the daily amount shall be computed and
multiplied by the Applicable Commitment Fee Rate for each period during which such Applicable
Commitment Fee Rate was in effect, with effect from the date of the change in such rate pursuant to
the definition of Applicable Commitment Fee Rate. The commitment fee shall accrue at all times,
including at any time during which one or more of the conditions in Article IV is not met.




          (b) Other Fees.







79









 









     (i) The Borrowers shall pay to the Initial Lenders, the Bookrunners and the Collateral
Agents for their own respective accounts fees in the amounts and at the times specified in
the Fee Letters. Such fees shall be fully earned when paid and shall not be refundable for
any reason whatsoever.




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



          2.10 Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate.




          (a) All computations of fees, interest for Base Rate Loans, Canadian Base Rate Loans and
Canadian Prime Rate Loans when the Base Rate, Canadian Base Rate and/or Canadian Prime Rate is
determined by Bank of America’s or Bank or America-Canada Branch’s, as applicable, “prime rate” or
“base rate”, and BA Rate Loans shall be made on the basis of a year of 365 days and actual days
elapsed. All other computations of interest shall be made on the basis of a 360-day year and
actual days elapsed (which results in more fees or interest, as applicable, being paid than if
computed on the basis of a 365-day year). Interest shall accrue on each Loan for the day on which
the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the
Loan or such portion is paid, provided that any Loan that is repaid on the same day on
which it is made shall, subject to Section 2.12(a), bear interest for one day. Each
determination by the Administrative Agent of an interest rate or fee hereunder shall be conclusive
and binding for all purposes, absent manifest error. For the purposes of the Interest Act
(Canada), (i) whenever any interest or fees under this Agreement or any other Loan Document is
calculated using a rate based on a year of 360 days, the rate determined pursuant to such
calculation, when expressed as an annual rate, is equivalent to (x) the applicable rate,
(y) multiplied by the actual number of days in the calendar year in which the period for which such
interest is payable (or compounded) ends, and (z) divided by 360, (ii) the principle of deemed
reinvestment of interest does not apply to any interest calculation under this Agreement, and
(iii) the rates of interest stipulated in this Agreement are intended to be nominal rates and not
effective rates or yields.




          (b) If, as a result of any restatement of or other adjustment to the financial statements of
the Specified U.S. Borrower or for any other reason, the Borrowers or the Lenders determine that
(i) Average Excess Availability as calculated by a Borrower as of any applicable date was
inaccurate and (ii) a proper calculation of the Average Excess Availability would have resulted in
a higher Applicable Rate for such period, the applicable Borrowers shall immediately and
retroactively be obligated to pay to the Administrative Agent for the account of the applicable
Lenders or L/C Issuers, as the case may be, promptly on demand by the Administrative Agent (or,
after the occurrence of an actual or deemed entry of an order for relief with respect to any such
Borrower under any Debtor Relief Laws, automatically and without further action by the
Administrative Agent, any Lender or any L/C Issuer), an amount equal to the excess of the amount of
interest and fees that should have been paid for such period over the amount of interest and fees
actually paid for such period. If, with respect to (i) the fiscal quarter of the Specified U.S.
Borrower in which the Closing Date occurs and (ii) the first full fiscal quarter of the Specified
U.S. Borrower ending after the Closing Date, the Applicable Rate had been in each case calculated
on the basis of Average Excess Availability for such period (instead of Excess Availability as of
the Closing Date) and such calculation would have resulted in a higher Applicable Rate for such
period, the Borrowers shall, on the last day of such period, pay to the Administrative Agent for
the account of the applicable Lenders or L/C Issuers, as the case may be, an amount equal to the
excess of (X) the amount of interest and fees that would have been paid for each such period if the
Applicable Margin had been in each case calculated on the basis of Average Excess Availability for
such period (instead of Excess Availability as of the Closing Date) over (Y) the amount of interest
and fees actually paid for each such period. This paragraph shall not limit the rights of the
Administrative Agent, any Lender or any L/C Issuer, as the case may be, under






80









 







Section 2.03(b)(iii), 2.03(h) or 2.08(b) or under
Article VIII. The Borrowers’ obligations under this paragraph shall survive the
termination of the Aggregate Commitments and the repayment of all other Obligations hereunder.




          2.11 Evidence of Debt.




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




          (b) In addition to the accounts and records referred to in Section 2.11(a), each
Lender and the Administrative Agent shall maintain in accordance with its usual practice accounts
or records evidencing the purchases and sales by such Lender of participations in Letters of Credit
and Swing Line Loans. In the event of any conflict between the accounts and records maintained by
the Administrative Agent and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of manifest error.




          2.12 Payments Generally; Administrative Agent’s Clawback.




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




          (b)





     (i) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to the proposed date of
any Borrowing of Eurodollar Rate Loans or BA Rate Loans (or, in the case of any Borrowing of
Base Rate Loans, Canadian Base Rate Loans or Canadian Prime Rate Loans, prior to 12:00 noon
on the date of such Borrowing) that such Lender will not make available to the
Administrative Agent



81









 






such Lender’s share of such Borrowing, the Administrative Agent may assume that such
Lender has made such share available on such date in accordance with Section 2.02
(or, in the case of a Borrowing of Base Rate Loans, Canadian Base Rate Loans or Canadian
Prime Rate Loans, that such Lender has made such share available in accordance with and at
the time required by Section 2.02) and may, in reliance upon such assumption, make
available to the applicable Borrower a corresponding amount. In such event, if a Lender has
not in fact made its share of the applicable Borrowing available to the Administrative
Agent, then the applicable Lender and the applicable Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount in immediately available
funds with interest thereon, for each day from and including the date such amount is made
available to such Borrower to but excluding the date of payment to the Administrative Agent,
at (A) in the case of a payment to be made by such Lender, the Overnight Rate, plus any
administrative, processing or similar fees customarily charged by the Administrative Agent
in connection with the foregoing, and (B) in the case of a payment to be made by a Borrower,
the interest rate applicable to Base Rate Loans, Canadian Base Rate Loans or Canadian Prime
Rate Loans, as applicable. If such Borrower and such Lender shall pay such interest to the
Administrative Agent for the same or an overlapping period, the Administrative Agent shall
promptly remit to such Borrower the amount of such interest paid by such Borrower for such
period. If such Lender pays its share of the applicable Borrowing to the Administrative
Agent, then the amount so paid shall constitute such Lender’s Loan included in such
Borrowing. Any payment by a Borrower shall be without prejudice to any claim such Borrower
may have against a Lender that shall have failed to make such payment to the Administrative
Agent.




     (ii) Payments by Borrower; Presumptions by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Borrower prior to the time at which
any payment is due to the Administrative Agent for the account of the Lenders or the L/C
Issuers hereunder that such Borrower will not make such payment, the Administrative Agent
may assume that such Borrower has made such payment on such date in accordance herewith and
may, in reliance upon such assumption, distribute to the Appropriate Lenders or the
applicable L/C Issuer, as the case may be, the amount due. In such event, if such Borrower
has not in fact made such payment, then each of the Appropriate Lenders or the applicable
L/C Issuer, as the case may be, severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender or such L/C Issuer, in
immediately available funds with interest thereon, for each day from and including the date
such amount is distributed to it to but excluding the date of payment to the Administrative
Agent, at the Overnight Rate.



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




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




          (d) Obligations of Lenders Several. The obligations of the Lenders hereunder to make
Revolving Credit Loans, to fund participations in Letters of Credit and Swing Line Loans and to
make payments pursuant to Section 11.04(c) are several and not joint. The failure of any
Lender to make any Loan, to fund any such participation or to make any payment under
Section 11.04(c) on any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such






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date, and no Lender shall be responsible for the failure of any other Lender to so make its
Loan, to purchase its participation or to make its payment under Section 11.04(c).




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




          (f) Insufficient Funds. If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal, L/C Borrowings,
interest and fees then due hereunder and the relevant Borrower has not specified the application of
such funds, such funds shall be applied (in each case with respect to the applicable Facility or
Facilities) (i) first, toward payment of interest and fees then due hereunder (other than
in respect of Bank Product Debt), ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, (ii) second, toward payment of the
principal amount of any Overadvance Loans, ratably among the parties entitled thereto in accordance
with the amounts of principal then due to such parties and (iii) third, toward payment of
principal, L/C Borrowings and other Obligations (other than in respect of Bank Product Debt) then
due hereunder, ratably among the parties entitled thereto in accordance with the amounts of
principal, L/C Borrowings and other Obligations then owing to such parties; provided,
however, that the proceeds from the foreclosure of any Collateral shall be applied as set
forth in the Intercreditor Agreement; provided, further, that this
Section 2.12(f) is subject in all respects to Section 8.03.




          2.13 Sharing of Payments by Lenders. If any Lender shall, by exercising any right of
setoff or counterclaim or otherwise, obtain payment in respect of (a) Obligations in respect of any
the Facilities due and payable to such Lender hereunder and under the other Loan Documents at such
time in excess of its ratable share (according to the proportion of (i) the amount of such
Obligations due and payable to such Lender at such time to (ii) the aggregate amount of the
Obligations in respect of the Facilities due and payable to all Lenders hereunder and under the
other Loan Documents at such time) of payments on account of the Obligations in respect of the
Facilities due and payable to all Lenders hereunder and under the other Loan Documents at such time
obtained by all the Lenders at such time or (b) Obligations in respect of any of the Facilities
owing (but not due and payable) to such Lender hereunder and under the other Loan Documents at such
time in excess of its ratable share (according to the proportion of (i) the amount of such
Obligations owing (but not due and payable) to such Lender at such time to (ii) the aggregate
amount of the Obligations in respect of the Facilities owing (but not due and payable) to all
Lenders hereunder and under the other Loan Parties at such time) of payment on account of the
Obligations in respect of the Facilities owing (but not due and payable) to all Lenders hereunder
and under the other Loan Documents at such time obtained by all of the Lenders at such time then
the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such
fact, and (b) purchase (for cash at face value) participations in the Loans and subparticipations
in L/C Obligations and Swing Line Loans of the other Lenders, or make such other adjustments as
shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably
in accordance with the aggregate amount of Obligations in respect of the Facilities then due and
payable to the Lenders or owing (but not due and payable) to the Lenders, as the case may be;
provided that prior to the CAM Exchange Date, each Lender shall only purchase
participations in Loans, L/C Obligations and Swing Line Loans under the Facility with respect to
which they hold a Commitment; and provided further that:





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



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



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




          2.14 Nature of Obligations.




          (a) Each of the U.S. Borrowers acknowledges that (a) it will directly or indirectly realize
material benefits from the commitments, working capital loans and other extensions of credit
provided by the Lenders under the U.S. Revolving Credit Facility, including liquidity for ongoing
operations, intercompany credit support and other credit availability necessary in the conduct of
its business and (b) such benefits are an essential component of its continuing financial
well-being. Accordingly, in consideration of such benefits and other valuable consideration,
including credit accommodations provided or otherwise made available by the Specified U.S.
Borrower, each of the U.S. Borrowers agrees that all U.S. Obligations of each U.S. Borrower under
or in respect of this Agreement or any other Loan Document shall be deemed incurred for the joint
benefit of all U.S. Borrowers and shall be joint and several obligations of all the U.S. Borrowers.
The parties further agree that no Foreign Loan Party shall be liable for any U.S. Obligation.




          (b) Each U.S. Borrower waives presentment to, demand of payment from and protest to the other
U.S. Borrowers of any of the U.S. Obligations, and also waives notice of acceptance of its
Obligations and notice of protest for nonpayment. The Obligations of a U.S. Borrower hereunder
shall not be affected by (i) the failure of any Lender or the Administrative Agent to assert any
claim or demand or to enforce any right or remedy against the other U.S. Borrowers under the
provisions of this Agreement or any of the other Loan Documents or otherwise; (ii) any rescission,
waiver, amendment or modification of any of the terms or provisions of this Agreement, any of the
other Loan Documents or any other agreement; or (iii) the failure of any Lender to exercise any
right or remedy against any other U.S. Borrower.




          (c) Each U.S. Borrower further agrees that its agreement hereunder constitutes a promise of
payment when due and not of collection, and waives any right to require that any resort be had by
any Lender to any balance of any deposit account or credit on the books of any Lender in favor of
any other U.S. Borrower or any other Person.




          (d) The Obligations of each U.S. Borrower hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including, without limitation, compromise,
and shall not be subject to any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of the Obligations of the
other U.S. Borrowers or otherwise. Without limiting the generality of the foregoing, the
Obligations of each U.S. Borrower hereunder shall not be discharged or impaired or otherwise
affected by the failure of the Administrative Agent or any Lender to assert any claim or demand or
to enforce any remedy under this Agreement or under any other Loan Document or any other agreement,
by any waiver or modification in respect of any thereof, by any default, failure or delay, willful
or otherwise, in the performance of the Obligations of the other U.S. Borrowers, or by any other
act or omission which may or might in any






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manner or to any extent vary the risk of such Borrower or otherwise operate as a discharge of
such Borrower as a matter of law or equity.




          (e) Each U.S. Borrower further agrees that its Obligations hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of
principal of or interest on any Obligation of the other U.S. Borrowers is rescinded or must
otherwise be restored by the Administrative Agent or any Lender upon the occurrence of any event
described in Sections 8.01(f)or (g) in respect of such Borrower, any of the other
U.S. Borrowers or otherwise.




          (f) In furtherance of the foregoing and not in limitation of any other right which the
Administrative Agent or any Lender may have at law or in equity against any U.S. Borrower by virtue
hereof, upon the failure of a U.S. Borrower to pay any Obligation when and as the same shall become
due, whether at maturity, by acceleration, after notice of prepayment or otherwise, each other U.S.
Borrower hereby promises to and will, upon receipt of written demand by the Administrative Agent,
forthwith pay, or cause to be paid, in cash the amount of such unpaid U.S. Obligations, and
thereupon each U.S. Revolving Credit Lender shall, in a reasonable manner, assign the amount of the
U.S. Obligations of the other U.S. Borrowers owed to it and paid by such Borrower pursuant to this
guarantee to such Borrower, such assignment to be pro tanto to the extent to which the Obligations
in question were discharged by such Borrower, or make such disposition thereof as such Borrower
shall direct (all without recourse to any Lender and without any representation or warranty by any
Lender).




          (g) Upon payment by a U.S. Borrower of any amount as provided above, all rights of such
Borrower against another U.S. Borrower, as the case may be, arising as a result thereof by way of
right of subrogation or otherwise shall in all respects be subordinated and junior in right of
payment to the prior indefeasible payment in full of all the U.S. Obligations to the U.S. Revolving
Credit Lenders.




          (h) Each U.S. Borrower, the Administrative Agent and each other Secured Party, hereby confirms
that it is the intention of all such Persons that the agreement and the Obligations of each U.S.
Borrower hereunder not constitute a fraudulent transfer or conveyance for purposes of Debtor Relief
Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
foreign, federal or state law to the extent applicable to the agreement and the Obligations of each
U.S. Borrower hereunder. To effectuate the foregoing intention, the Administrative Agent, the
other Secured Parties and the U.S. Borrowers hereby irrevocably agree that the Obligations of each
U.S. Borrower hereunder shall be limited to the maximum amount as will result in the Obligations of
such U.S. Borrower hereunder not constituting a fraudulent transfer or conveyance. Each U.S.
Borrower hereby unconditionally and irrevocably agrees that in the event any payment shall be
required to be made to any Secured Party, such U.S. Borrower will contribute, to the maximum extent
permitted by law, such amounts to each other U.S. Borrower so as to maximize the aggregate amount
paid to the Secured Parties under or in respect of the Loan Documents.




          2.15 Borrower Agent. Each Borrower hereby irrevocably appoints the Specified U.S.
Borrower, and the Specified U.S. Borrower agrees to act under this Agreement, as the agent and
representative of itself and each other Borrower for all purposes under this Agreement, including
requesting Borrowings, executing and delivering Notes as agent on behalf of the Borrowers in favor
of the Lenders, selecting whether any Loan or portion thereof is to bear interest as a Base Rate
Loan, a Canadian Base Rate Loan, a Canadian Prime Rate Loan, a BA Rate Loan or a Eurodollar Rate
Loan, and receiving account statements and other notices and communications to Borrowers (or any of
them) from the Administrative Agent. The Administrative Agent may rely, and shall be fully
protected in relying, on any Committed Loan Notice, disbursement instructions, reports,
information, Borrowing Base Certificate or any other notice or communication made or given by the
Borrower Agent, whether in its own name, on behalf of any Borrower or on behalf of “the Borrowers,”
and the Administrative Agent shall have no






85









 







obligation to make any inquiry or request any confirmation from or on behalf of any other
Borrower as to the binding effect on such Borrower of any such Committed Loan Notice, instruction,
report, information, Borrowing Base Certificate or other notice or communication from the Borrower
Agent, nor shall any joint and several character of the Borrowers’ liability for the Obligations be
affected.




          2.16 Commitment Increase.




          (a) The Borrower Agent may at any time or from time to time after the Closing Date, by notice
to the Administrative Agent (whereupon the Administrative Agent shall promptly deliver a copy to
each of the Lenders), request one or more increases in the amount of the U.S. Revolving Credit
Commitments (each such increase, a “Commitment Increase”); provided that (i) no
Default or Event of Default shall exist or would exist after giving effect to any Commitment
Increase, (ii) all fees and expenses owing to the Administrative Agent and the relevant Lenders in
respect of such Commitment Increase shall have been paid, (iii) each Commitment Increase shall be
on the same terms and conditions (including interest rate margins but excluding any upfront fees)
as the U.S. Revolving Credit Facility before giving effect thereto, (iv) each Commitment Increase
shall be in an aggregate principal amount that is not less than $10,000,000 (provided that
such amount may be less than $10,000,000 if such amount represents all remaining availability under
the limit set forth in clause (v) below) and (v) after giving effect to any and all of the
Commitment Increases, the U.S. Revolving Credit Facility shall not exceed $300,000,000. Each
notice from the Borrower Agent pursuant to this Section 2.16 shall set forth the requested
amount of the relevant Commitment Increases. Commitment Increases may be provided by any existing
Lender (it being understood that no existing Lender will have an obligation to provide a portion of
any Commitment Increase) or by any other Eligible Assignee. Commitments in respect of Commitment
Increases shall become U.S. Revolving Credit Commitments (or in the case of a Commitment Increase
to be provided by an existing U.S. Revolving Credit Lender, an increase in such Lender’s applicable
U.S. Revolving Credit Commitment) under this Agreement pursuant to an amendment (an
“Incremental Amendment”) to Schedule 2.01 (with a joinder agreement in the case of
any Eligible Assignee providing any portion of such Commitment Increases), executed by (x) the
Administrative Agent and in the case of an Eligible Assignee, each U.S. L/C Issuer and each U.S.
Swing Line Lender, the consent of each of which is not to be unreasonably withheld or delayed, (y)
each Lender and Eligible Assignee agreeing to provide any portion of a Commitment Increase and (z)
the Loan Parties, and reaffirmations of the Loan Documents executed by the Loan Parties, in each
case in form and substance reasonably satisfactory to the Administrative Agent. The Incremental
Amendment may, without the consent of any other Lenders, effect such amendments to this Agreement
and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the
Administrative Agent and the Borrowers, to effect the provisions of this Section 2.16. The
effectiveness of any Incremental Amendment shall be subject to the satisfaction on the date thereof
of each of the conditions set forth in Section 4.02 (it being understood that all
references to “the date of such Credit Extension” or similar language in such Section 4.02
shall be deemed to refer to the effective date of such Incremental Amendment).




          (b) Upon each increase in the U.S. Revolving Credit Commitments pursuant to this
Section 2.16, (x) each U.S. Revolving Credit Lender immediately prior to such increase will
automatically and without further act be deemed to have assigned to each U.S. Revolving Credit
Lender providing a portion of the Commitment Increase (each a “Commitment Increase Lender”)
in respect of such increase, and each such Commitment Increase Lender will automatically and
without further act be deemed to have assumed, a portion of such U.S. Revolving Credit Lender’s
participations hereunder in outstanding U.S. Letters of Credit and U.S. Swing Line Loans such that,
after giving effect to each such deemed assignment and assumption of participations, the percentage
of the aggregate outstanding (i) participations hereunder in U.S. Letters of Credit and (ii)
participations hereunder in U.S. Swing Line Loans held by each U.S. Revolving Credit Lender
(including each such Commitment Increase Lender)






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will equal the percentage of the aggregate U.S. Revolving Credit Commitments of all U.S.
Revolving Credit Lenders represented by such U.S. Revolving Credit Lender’s U.S. Revolving Credit
Commitment and (y) if, on the date of such increase, there are any U.S. Revolving Credit Loans
outstanding, portions of such U.S. Revolving Credit Loans shall on the date of the effectiveness of
such Commitment Increase be prepaid with the proceeds of additional U.S. Revolving Credit Loans
made by the Commitment Increase Lenders (such that after giving effect to such prepayment, the
percentage of the U.S. Revolving Credit Loans held by each U.S. Revolving Credit Lender will equal
the percentage of the aggregate U.S. Revolving Credit Commitments of all U.S. Revolving Credit
Lenders represented by such U.S. Revolving Credit Lender’s U.S. Revolving Credit Commitment after
giving effect to such Commitment Increase), which prepayment shall be accompanied by accrued
interest on the Loans being prepaid and any other amounts payable to any Lender in accordance with
Section 3.05. The Administrative Agent and the U.S. Revolving Credit Lenders hereby agree
that the minimum borrowing, pro rata borrowing and pro rata payment requirements contained
elsewhere in this Agreement shall not apply to the transactions effected pursuant to the
immediately preceding sentence. This Section 2.16 shall supersede any provisions in
Section 2.13 or 11.01 to the contrary.




ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY




          3.01 Taxes. (a) Payments Free of Taxes; Obligation to Withhold; Payments on
Account of Taxes.





     (i) Any and all payments by or on account of any obligation of any Borrower hereunder
or under any other Loan Document shall to the extent permitted by applicable Laws be made
free and clear of and without reduction or withholding for any Taxes. If, however,
applicable Laws require any Borrower or the Administrative Agent to withhold or deduct any
Tax, such Tax shall be withheld or deducted in accordance with such Laws as determined by
such Borrower or the Administrative Agent, as the case may be.




     (ii) If any Borrower or the Administrative Agent shall be required by the Code or other
applicable Law to withhold or deduct any Taxes, including both United States federal backup
withholding and withholding taxes, from any payment, then (A) such Borrower or the
Administrative Agent shall withhold or make such deductions as are determined by such
Borrower or the Administrative Agent to be required, (B) such Borrower or the Administrative
Agent shall timely pay the full amount withheld or deducted to the relevant Governmental
Authority in accordance with the Code or other applicable Law, and (C) to the extent that
the withholding or deduction is made on account of Indemnified Taxes or Other Taxes, the sum
payable by such Borrower shall be increased as necessary so that after any required
withholding or the making of all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, Lender or L/C Issuer,
as the case may be, receives an amount equal to the sum it would have received had no such
withholding or deduction been made



          (b) Payment of Other Taxes by the Borrowers. Without limiting the provisions of
subsection (a) above, each Borrower shall timely pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.




          (c) Tax Indemnifications.





     (i) Without limiting the provisions of subsection (a) or (b) above,
each Borrower shall, and do hereby, jointly and severally, indemnify the Administrative
Agent, each Lender and



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each L/C Issuer, and shall make payment in respect thereof within 10 Business Days
after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes
(including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this Section) withheld or deducted by any Borrower or the
Administrative Agent or paid by the Administrative Agent, such Lender or such L/C Issuer, as
the case may be, and any penalties, interest and reasonable expenses arising therefrom or
with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. Each Borrower shall
also, and do hereby, jointly and severally, indemnify the Administrative Agent, and shall
make payment in respect thereof within 10 days after demand therefor, for any amount which a
Lender or an L/C Issuer for any reason fails to pay indefeasibly to the Administrative Agent
as required by clause (ii)of this subsection. A certificate as to the amount of
any such payment or liability delivered to the applicable Borrower by a Lender or an L/C
Issuer (with a copy to the Administrative Agent), or by the Administrative Agent on its own
behalf or on behalf of a Lender or an L/C Issuer, shall be conclusive absent manifest error.




     (ii) Without limiting the provisions of subsection (a) or (b) above,
each Lender and each L/C Issuer shall, and does hereby, indemnify each Borrower and the
Administrative Agent, and shall make payment in respect thereof within 10 Business Days
after demand therefor, against any and all Taxes and any and all related losses, claims,
liabilities, penalties, interest and expenses (including the fees, charges and disbursements
of any counsel for the Borrowers or the Administrative Agent and amounts paid by the
Borrowers pursuant to clause (c)(i) above as a result of the failure of such Lender
or L/C Issuer to pay any amount owed to the Administrative Agent pursuant to this
clause (c)(ii)) incurred by or asserted against a Borrower or the Administrative
Agent by any Governmental Authority as a result of the failure by such Lender or the L/C
Issuer, as the case may be, to deliver, or as a result of the inaccuracy, inadequacy or
deficiency of, any documentation required to be delivered by such Lender or such L/C Issuer,
as the case may be, to such Borrower or the Administrative Agent pursuant to
subsection (e). Each Lender and each L/C Issuer hereby authorizes the
Administrative Agent to set off and apply any and all amounts at any time owing to such
Lender or such L/C Issuer, as the case may be, under this Agreement or any other Loan
Document against any amount due to the Administrative Agent or any Borrower, as the case may
be, under this clause (ii). The agreements in this clause (ii) shall
survive the resignation and/or replacement of the Administrative Agent, any assignment of
rights by, or the replacement of, a Lender or an L/C Issuer, the termination of the
Aggregate Commitments and the repayment, satisfaction or discharge of all other Obligations.



          (d) Evidence of Payments. Upon request by a Borrower or the Administrative Agent, as
the case may be, after any payment of Taxes by such Borrower or the Administrative Agent to a
Governmental Authority as provided in this Section 3.01, such Borrower shall deliver to the
Administrative Agent or the Administrative Agent shall deliver to such Borrower, as the case may
be, the original or a certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of any return required by Laws to report such payment or other evidence of
such payment reasonably satisfactory to such Borrower or the Administrative Agent.




          (e) Status of Lenders; Tax Documentation.





     (i) Each Lender and L/C Issuer shall deliver to the applicable Borrower and to the
Administrative Agent, at the time or times prescribed by applicable Laws or when reasonably
requested by such Borrower or the Administrative Agent, such properly completed and executed
documentation prescribed by applicable Laws or by the taxing authorities of any jurisdiction
and such other reasonably requested information as will permit such Borrower or the
Administrative



88









 






Agent, as the case may be, to determine (A) whether or not payments made hereunder or
under any other Loan Document are subject to Taxes, (B) if applicable, the required rate of
withholding or deduction, and (C) such Lender’s or L/C Issuer’s entitlement to any available
exemption from, or reduction of, applicable Taxes in respect of all payments to be made to
such Lender or L/C Issuer by such Borrower pursuant to this Agreement or otherwise to
establish such Lender’s or L/C Issuer’s status for withholding tax purposes in the
applicable jurisdiction.




     (ii) Without limiting the generality of the foregoing, if a Borrower is a “United
States person” within the meaning of Section 7701(a)(30) of the Code:




     (A) any Lender or L/C Issuer that is a “United States person” within the meaning of
Section 7701(a)(30) of the Code shall deliver to such Borrower and the Administrative Agent
duly executed, properly completed originals of Internal Revenue Service Form W-9 or such
other documentation or information prescribed by applicable Laws or reasonably requested by
such Borrower or the Administrative Agent as will enable such Borrower or the Administrative
Agent, as the case may be, to determine whether or not such Lender or L/C Issuer is subject
to backup withholding or information reporting requirements; and




     (B) each Foreign Lender (except in connection with a CAM Exchange (in which case such
Foreign Lender shall comply with this Section 3.01(e)(ii)(B) to the extent
practicable)) or Foreign L/C Issuer that is entitled under the Code or any applicable treaty
to an exemption from or reduction of withholding tax with respect to payments hereunder or
under any other Loan Document shall deliver to such Borrower and the Administrative Agent
(in such number of copies as shall be requested by the recipient) on or prior to the date on
which such Foreign Lender or Foreign L/C Issuer becomes a Lender (other than as a result of
a CAM Exchange) under this Agreement, on or prior to the date on which any such form of
certification expires or becomes obsolete, and after the occurrence of any event requiring a
change in the most recent form or certification previously delivered, but only if such
Foreign Lender or Foreign L/C Issuer is legally entitled to do so, whichever of the
following is applicable:




     (I) duly executed, properly completed originals of Internal Revenue Service
Form W-8BEN or any successor thereto claiming eligibility for benefits of an income
tax treaty to which the United States is a party,




     (II) duly executed, properly completed originals of Internal Revenue Service
Form W-8ECI or any successor thereto,




     (III) duly executed, properly completed originals of Internal Revenue Service
Form W-8IMY or any successor thereto and all required supporting documentation
claiming (to the extent legally able to do so) exemption from or reduction in United
States federal withholding tax,




     (IV) in the case of a Foreign Lender or Foreign L/C Issuer claiming the
benefits of the exemption for portfolio interest under section 871(h) or 881(c) of
the Code, (x) a certificate to the effect that such Foreign Lender or Foreign L/C
Issuer is not (A) a “bank” within the meaning of section 881(c)(3)(A) of the Code,
(B) a “10 percent shareholder” of such Borrower within the meaning of
section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation”
described in section 881(c)(3)(C) of the Code and (y) duly executed, properly
completed originals of Internal Revenue Service Form W-8BEN, or



89









 






     (V) duly executed, properly completed originals of any other form prescribed by
applicable Laws as a basis for claiming exemption from or a reduction in United
States federal withholding tax together with such supplementary documentation as may
be prescribed by applicable Laws to permit such Borrower or the Administrative Agent
to determine the withholding or deduction required to be made.




     (iii) Each Lender (except an assignee Lender pursuant to a CAM Exchange under
Section 8.04 (in which case any such Lender shall comply with this
Section 3.01(e)(iii) to the extent practicable)) or L/C Issuer shall promptly
(A) notify the applicable Borrower and the Administrative Agent of any change in
circumstances which would modify or render invalid any claimed exemption or reduction, and
(B) take such steps as shall not be materially disadvantageous to it, in the reasonable
judgment of such Lender or L/C Issuer, and as may be reasonably necessary (including the
re-designation of its Lending Office) to avoid any requirement of applicable Laws of any
jurisdiction that such Borrower or the Administrative Agent make any withholding or
deduction for taxes from amounts payable to such Lender or L/C Issuer.



          (f) Treatment of Certain Refunds. Unless required by applicable Laws, at no time
shall the Administrative Agent have any obligation to file for or otherwise pursue on behalf of a
Lender or an L/C Issuer, or have any obligation to pay to any Lender or any L/C Issuer, any refund
of Taxes withheld or deducted from funds paid for the account of such Lender or such L/C Issuer, as
the case may be. If the Administrative Agent, any Lender or any L/C Issuer determines, in its
reasonable discretion, that it has received a refund (or credit against other taxes payable) of any
Taxes or Other Taxes as to which it has been indemnified by a Borrower or with respect to which a
Borrower has paid additional amounts pursuant to this Section, it shall pay to such Borrower an
amount equal to such refund (or credit against other taxes payable) (but only to the extent of
indemnity payments made, or additional amounts paid, by such Borrower under this Section with
respect to the Taxes or Other Taxes giving rise to such refund or credit), net of all out-of-pocket
expenses of the Administrative Agent, such Lender or such L/C Issuer, as the case may be, and
without interest (other than any interest paid by the relevant Governmental Authority with respect
to such refund or credit), provided that such Borrower, upon the request of the
Administrative Agent, such Lender or such L/C Issuer, agrees to repay the amount paid over to such
Borrower (plus any penalties, interest or other charges imposed by the relevant
Governmental Authority) to the Administrative Agent, such Lender or such L/C Issuer if the
Administrative Agent, such Lender or such L/C Issuer is required to repay such refund to such
Governmental Authority. This subsection shall not be construed to require the Administrative
Agent, any Lender or any L/C Issuer to make available its tax returns (or any other information
relating to its taxes that it deems confidential) to any Borrower or any other Person.




          3.02 Illegality. If any Lender determines in good faith that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or
its applicable Lending Office to make, maintain or fund Eurodollar Rate Loans or BA Rate Loans, or
to determine or charge interest rates based upon the Eurodollar Rate or BA Rate, or any
Governmental Authority has imposed material restrictions on the authority of such Lender to
purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice
thereof by such Lender to the applicable Borrowers through the Administrative Agent, any obligation
of such Lender to make or continue Eurodollar Rate Loans or BA Rate Loans or to convert Base Rate
Loans or Canadian Base Rate Loans to Eurodollar Rate Loans or Canadian Prime Rate Loans to BA Rate
Loans shall be suspended until such Lender notifies the Administrative Agent and the applicable
Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of
such notice, the applicable Borrower shall, upon demand from such Lender (with a copy to the
Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans or BA Rate Loans
of such Lender to Base Rate Loans, Canadian Base






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Rate Loans or Canadian Prime Rate Loans, as applicable, either on the last day of the Interest
Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans or BA
Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such
Eurodollar Rate Loans or BA Rate Loans. Upon any such prepayment or conversion, the applicable
Borrower shall also pay accrued interest on the amount so prepaid or converted.




          3.03 Inability to Determine Rates. If the Required Lenders determine that for any
reason in connection with any request for a Eurodollar Rate Loan or a BA Rate Loan or a conversion
to or continuation thereof that (a) Dollar deposits are not being offered to banks in the London
interbank eurodollar market for the applicable amount and Interest Period of such Eurodollar Rate
Loan, (b) adequate and reasonable means do not exist for determining the Eurodollar Rate or the BA
Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan or BA Rate
Loan, (c) the Reuters Screen CDOR Page is not available for the timely determination of the BA
Rate, and the BA Rate cannot otherwise be determined in a timely manner in accordance with the
definition of “BA Rate”, or (d) the Eurodollar Rate or BA Rate for any requested Interest Period
with respect to a proposed Eurodollar Rate Loan or BA Rate Loan does not adequately and fairly
reflect the cost to such Lenders of funding such Loan, the Administrative Agent will promptly so
notify the applicable Borrowers and each Lender. Thereafter, the obligation of the Lenders to make
or maintain Eurodollar Rate Loans or BA Rate Loans shall be suspended until the Administrative
Agent (upon the instruction of the Required Lenders) revokes such notice. Upon receipt of such
notice, the applicable Borrower may revoke any pending request for a Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or BA Rate Loans or, failing that, will be deemed to have
converted such request into a request for a Borrowing of Base Rate Loans, Canadian Base Rate Loans
or Canadian Prime Rate Loans, as applicable, in the amount specified therein.




          3.04 Increased Costs; Reserves on Eurodollar Rate Loans. (a) Increased Costs
Generally. If any Change in Law shall:





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




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




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


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






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additional amount or amounts as will compensate such Lender or such L/C Issuer, as the case may be,
for such additional costs incurred or reduction suffered.




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




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




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




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







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





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




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




     (c) any assignment of a Eurodollar Rate Loan or BA Rate Loan on a day other than the
last day of the Interest Period therefor as a result of a request by such Borrower pursuant
to Section 11.13; or




     (d) the occurrence of a CAM Exchange pursuant to Section 8.04;


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



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




          3.06 Mitigation Obligations; Replacement of Lenders.




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




          (b) Replacement of Lenders. If any Lender requests compensation under
Section 3.04, or if a Borrower is required to indemnify or pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 3.01, such Borrower may replace such Lender in accordance with
Section 11.13.







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          3.07 Survival. All of the Borrowers’ obligations under this Article III shall survive
termination of the Aggregate Commitments, repayment of all other Obligations hereunder and
resignation of the Administrative Agent.




ARTICLE IV

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS




          4.01 Conditions of Initial Credit Extension. The obligation of each L/C Issuer and
each Lender to make its initial Credit Extension hereunder is subject to satisfaction of the
following conditions precedent:




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





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




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




     (iii) the Intercreditor Agreement duly executed by the Administrative Agent,
the Trustee and the U.S. Loan Parties;




     (iv) the U.S. Guaranty duly executed by the Specified U.S. Borrower and each
U.S. Subsidiary Guarantor;




     (v) the U.S. Security Agreement duly executed by each U.S. Loan Party, together
with:




     (A) subject to the Intercreditor Agreement, certificates representing
the Pledged Equity referred to therein accompanied by undated stock powers
executed in blank and instruments evidencing the Pledged Debt indorsed in
blank,




     (B) proper Financing Statements in form appropriate for filing under
the UCC and/or PPSA of all jurisdictions that the Administrative Agent may
deem necessary or desirable in order to perfect the Liens created under the
U.S. Security Agreement, covering the Collateral described in the U.S.
Security Agreement,




     (C) completed requests for information, dated on or before the date of
the initial Credit Extension, listing all effective financing statements
filed in the jurisdictions referred to in clause (B) above that name any
Loan Party as debtor, together with copies of such other financing
statements,




     (D) evidence of the completion of all other actions, recordings and
filings of or with respect to the U.S. Security Agreement that the
Administrative



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Agent may deem necessary or desirable in order to perfect the Liens
created thereby,




     (E) evidence that all other action that the Administrative Agent may
deem necessary or desirable in order to perfect the Liens created under the
U.S. Security Agreement has been taken (including receipt of duly executed
payoff letters and UCC-3 termination statements); and




     (F) the U.S. Perfection Certificate, along with completed Schedules
thereto, duly executed by the Specified U.S. Borrower;




provided, that, notwithstanding anything in this
Section 4.01(a)(v) to the contrary, solely with respect to any
non-U.S. Collateral, if the perfection of the Administrative Agent’s
security interest in such Collateral may not be accomplished prior to the
Closing Date without undue burden or expense and without the taking of any
action that goes beyond commercial reasonableness, then the delivery of
documents and instruments for perfection of such security interests shall
not constitute a condition precedent to the availability of the Facilities
to the U.S. Borrowers, and the Loan Parties hereby agree to deliver or cause
to be delivered such documents and instruments, and take or cause to be
taken such other actions as may be required to perfect such security
interests within the earlier of 30 days after the Closing Date and the time
at which any such non-U.S. Collateral becomes perfected in respect of the
Senior Secured Notes.




     (vi) deeds of trust, trust deeds, deeds to secure debt, and mortgages, in
substantially the form of Exhibit H (with such changes as may be
satisfactory to the Administrative Agent and its counsel to account for local law
matters) and otherwise in form and substance satisfactory to the Administrative
Agent and covering the properties listed on Schedule 4.01(a)(vi) (together
with the Assignments of Leases and Rents referred to therein and each other mortgage
delivered pursuant to Section 6.12, in each case as amended, the
“Mortgages”), duly executed by the appropriate U.S. Loan Party, together
with:




     (A) evidence that counterparts of the Mortgages have been duly
executed, acknowledged and delivered and are in form suitable for filing or
recording in all filing or recording offices that the Administrative Agent
may deem necessary or desirable in order to create a valid (junior only to
the Liens securing the Senior Secured Notes) and subsisting Lien on the
property described therein in favor of the Administrative Agent for the
benefit of the Secured Parties and that all filing, documentary, stamp,
intangible and recording taxes and fees have been paid,




     (B) fully paid American Land Title Association Lender’s Extended
Coverage title insurance policies (the “Mortgage Policies”) in form
and substance, with endorsements (including zoning endorsements) and in
amounts acceptable to the Administrative Agent in its reasonable discretion
(such amount not to exceed the value of the property in cases where tie-in
endorsements are available or, if not available, 10% of the value of such
property), issued, coinsured and reinsured by title insurers acceptable to
the Administrative Agent, insuring the Mortgages to be valid and subsisting
Liens on the property described



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therein, free and clear of all defects (including, but not limited to,
mechanics’ and materialmen’s Liens) and encumbrances, excepting only
Permitted Encumbrances and other Liens permitted under the Loan Documents,
and providing for such other affirmative insurance (including endorsements
for future advances under the Loan Documents, for mechanics’ and
materialmen’s Liens and for zoning of the applicable property) and such
coinsurance and direct access reinsurance as the Administrative Agent may
deem necessary or desirable, and with respect to any property located in a
state in which a zoning endorsement is not available, a zoning compliance
letter from the applicable municipality or, if not available, a zoning
report from Planning and Zoning Resources Corporation, in each case
satisfactory to the Administrative Agent in its reasonable discretion,




     (C) American Land Title Association/American Congress on Surveying and
Mapping form surveys, for which all necessary fees (where applicable) have
been paid, and dated no more than 30 days before the day of the initial
Credit Extension, certified to the Administrative Agent and the issuer of
the Mortgage Policies in a manner satisfactory to the Administrative Agent
by a land surveyor duly registered and licensed in the States in which the
property described in such surveys is located and acceptable to the
Administrative Agent, showing all buildings and other improvements, any
off-site improvements, the location of any easements, parking spaces, rights
of way, building set-back lines and other dimensional regulations and the
absence of encroachments, either by such improvements or on to such
property, and other defects, other than encroachments and other defects
acceptable to the Administrative Agent, provided that
notwithstanding anything in this clause (C) to the contrary, to the extent
that the Mortgage Policies for the properties listed on
Schedule 4.01(a)(vi) hereto include no survey exception without the
need to comply with this clause (C), this clause (C) shall not apply with
respect to such property,




     (D) a favorable opinion of local counsel to the Loan Parties in the
states in which the Properties are located, addressed to the Administrative
Agent and each Lender, with respect to the enforceability and perfection of
the Mortgages and any related fixture filings, in form and substance
reasonably satisfactory to the Administrative Agent and its counsel with
respect to such matters concerning the Loan Parties and the Loan Documents
as the Required Lenders may reasonably request;




     (E) evidence of the insurance required by the terms of the Mortgages;
and




     (F) such other consents and agreements and confirmations as the
Administrative Agent may deem reasonably necessary or desirable and evidence
that all other actions that the Administrative Agent may deem necessary or
desirable in order to create valid and subsisting Liens on the property
described in the Mortgages has been taken;




provided, that, notwithstanding anything in this
Section 4.01(a)(vi) to the contrary, no mortgages, title insurance
policies, surveys or other customary documentation relating to real property
Collateral (the “Real Estate Collateral Deliverables”), will be
delivered prior to or on the Closing Date and the delivery of such Real
Estate Collateral Deliverable shall not constitute a condition



96









 






precedent to the availability of the Facilities, and the Loan Parties hereby
agree to deliver such Real Estate Collateral Deliverable (including related
legal opinions as to matters of (i) enforceability and perfection of the
Mortgages and any related fixture filings, and (ii) corporate formalities,
as the Administrative Agent may request) within the earlier of 60 days after
the Closing Date and the time at which any such real property Collateral
secures, or Real Estate Collateral Deliverable is delivered in respect of,
the Senior Secured Notes; provided further that in each
case, the Administrative Agent may, in its reasonable discretion, grant
extensions of such time period.




     (vii) an intellectual property security agreement, in substantially the form of
Exhibit B to the U.S. Security Agreement (together with each other
intellectual property security agreement and intellectual property security
agreement supplement delivered pursuant to Section 6.12, in each case as
amended, the “U.S. Intellectual Property Security Agreement”), duly executed
by each U.S. Loan Party, together with evidence that all action that the
Administrative Agent may deem necessary or desirable in order to perfect the Liens
created under the U.S. Intellectual Property Security Agreement has been taken;




     (viii) the Canadian Guarantee duly executed by each Canadian Subsidiary
Guarantor;




     (ix) the Canadian Security Agreement duly executed by each Canadian Loan Party,
together with:




     (A) evidence that all other actions that the Administrative Agent may
deem necessary or desirable in order to perfect the Liens created under the
Canadian Security Agreement have been taken (including receipt of duly
executed payoff letters and UCC-3 and PPSA termination or discharge
statements, if applicable); and




     (B) the Canadian Perfection Certificate, along with completed Schedules
thereto, duly executed by the Canadian Borrower;




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




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




     (xii) a favorable opinion of Weil, Gotshal & Manges LLP, counsel to the Loan
Parties, addressed to the Administrative Agent and each Lender, in form and
substance reasonably satisfactory to the Required Lenders, with respect to such
matters



97









 






concerning the Loan Parties and the Loan Documents as the Required Lenders may
reasonably request;




     (xiii) a favorable opinion of Borden Ladner Gervais LLP, or such other local
counsel to the Loan Parties in Canada, addressed to the Administrative Agent and
each Canadian Lender, in form and substance reasonably satisfactory to the Required
Lenders, with respect to such matters concerning the Canadian Loan Parties and the
Canadian Loan Documents as the Required Lenders may reasonably request;




     (xiv) favorable opinions of local counsel to the Loan Parties in the United
States, addressed to the Administrative Agent and each Lender, in each case in form
and substance reasonably satisfactory to the Required Lenders, with respect to such
matters concerning the Loan Parties and the Loan Documents as the Required Lenders
may reasonably request;




     (xv) a certificate signed by a Responsible Officer of each of the Specified
U.S. Borrower and the Canadian Borrower certifying (A) that the conditions specified
in Sections 4.02(a),(b) and (d) have been satisfied and (B) that
there has been no event or circumstance since July 4, 2009 that has had or could be
reasonably expected to have, either individually or in the aggregate, a Material
Adverse Effect;




     (xvi) the Lenders shall have received: (A) audited consolidated financial
statements of the Specified U.S. Borrower and its subsidiaries for the three fiscal
years ended most recently prior to the Closing Date, and unaudited consolidated
financial statements of the Specified U.S. Borrower and its subsidiaries for any
interim quarterly periods that have ended since the most recent of such audited
financial statements, which in each case, (1) shall be reasonably satisfactory in
form and substance to the Lenders and (2) shall not be materially inconsistent with
the information heretofore provided; and (B) forecasts prepared by management of the
Specified U.S. Borrower and its subsidiaries, each in form reasonably satisfactory
to the Lenders, of balance sheets, income statements and cash flow statements for
each year commencing with the first fiscal year following the Closing Date for the
term of the Facilities (it being understood that the financial statements made
available to the Lenders prior to November 13, 2009 are reasonably satisfactory in
form and substance to the Lenders and are not materially inconsistent with the
information provided to the Lenders prior to November 13, 2009);




     (xvii) the Administrative Agent shall have received certification as to the
consolidated financial condition and Solvency of each Borrower and each Guarantor,
individually and together with its Subsidiaries, taken as a whole (after giving
effect to the Transactions and the incurrence of indebtedness related thereto), from
the chief financial officer of the Specified U.S. Borrower;




     (xviii) evidence that all insurance required to be maintained pursuant to the
Loan Documents has been obtained and is in effect, together with endorsements naming
the Administrative Agent, on behalf of the Lenders, as an additional insured or loss
payee, as the case may be, under all insurance policies maintained with respect to
the assets and properties of the Loan Parties that constitutes Collateral (and the
Lenders shall be satisfied with the amount, types and terms and conditions of all
insurance maintained by the Loan Parties and their subsidiaries); and



98









 






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



          (b) (i) All accrued fees required to be paid to the Administrative Agent, the Collateral
Agents (including the fees and expenses of counsel (including any local counsel) for the
Administrative Agent and the Collateral Agents) and the Bookrunners on or before the Closing Date
shall have been paid and (ii) all fees required to be paid to the Lenders on or before the Closing
Date shall have been paid.




          (c) Receipt of all governmental, shareholder and third party consents and approvals necessary
in connection with the Transactions and the related financings and other transactions contemplated
hereby.




          (d) There shall not have occurred since July 4, 2009 any event or condition that has had or
could be reasonably expected, either individually or in the aggregate, to have a Material Adverse
Effect.




          (e) The absence of any action, suit, investigation or proceeding pending or, to the knowledge
of the Borrowers, threatened in any court or before any arbitrator or governmental authority that
could reasonably be expected to have a Material Adverse Effect.




          (f) To the extent not set forth in the Approved Plan of Reorganization or different from what
is described in the Approved Plan of Reorganization, the corporate structure, capital structure,
cash management system, ownership, pension and tax structure/treatment and governing documents of
the Borrowers and the Guarantors shall be reasonably satisfactory to the Administrative Agent and
the Lenders.




          (g) The Bankruptcy Court shall have entered an order or orders, in form and substance
reasonably satisfactory to the Collateral Agents and Required Initial Lenders, confirming the
Approved Plan of Reorganization (the “Confirmation Order”), and such Confirmation Order
shall have become a final order, which shall not have been reversed, vacated or stayed and as to
which (i) the time to appeal, petition for certiorari or move for a stay, new trial, reargument or
rehearing has expired and as to which no appeal, petition for certiorari or other proceedings for a
stay, new trial, reargument or rehearing shall then be pending or (ii) if an appeal, writ of
certiorari, stay, new trial, re-argument or rehearing thereof has been sought, (A) such order or
judgment shall have been affirmed by the highest court to which such order was appealed, certiorari
shall have been denied or a stay, new trial, reargument or rehearing shall have been denied or
resulted in no modification of such order and (B) the time to take any further appeal, petition for
certiorari, or move for a stay, new trial, reargument or rehearing shall have expired (such order
or orders, a “Final Order”); provided that no order or judgment shall fail to be a
“Final Order” solely because of the possibility that a motion pursuant to section 502(j) or 1144 of
the Bankruptcy Code or under Rule 60 of the Federal Rules of Civil Procedure, or Bankruptcy
Rule 9024 has been or may be filed with respect to such order or judgment. Without limitation, the
Confirmation Order shall authorize and approve the Facilities (including the full amount of the
Facilities) and the making of Loans hereunder, the granting of the security interests in connection
herewith, and the payment of all fees provided for pursuant to and in respect of the Facilities.




          (h) The “Effective Date” of the Approved Plan of Reorganization, as defined therein, shall
occur simultaneously with the effectiveness of the Facilities and be effective without waiver by
any of the Debtors (as defined in the Approved Plan of Reorganization) of any condition of the
Approved Plan of Reorganization or any related transaction (with the exception of such transactions
contemplated






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by the terms of the Approved Plan of Reorganization to occur after the Closing Date), in each
case unless the same is not adverse to the interests of the Lenders, as reasonably determined by
the Required Initial Lenders, without the prior written consent of the Required Initial Lenders,
and each of the documents to be entered into in connection with the Approved Plan of Reorganization
shall be reasonably satisfactory to the Collateral Agents.




          (i) Immediately after giving effect to the Transactions, (i) Excess Availability shall not be
less than $40,000,000 and (ii) the sum of Canadian Available Cash plus U.S. Available Cash plus
Excess Availability, less the amounts of Canadian Available Cash and U.S. Available Cash included
in the calculation of Excess Availability, shall not be less than $100,000,000.




          (j) The Lenders shall have received all documentation and other information required by
regulatory authorities under applicable “know your customer” and anti-money laundering rules and
regulations, including without limitation the PATRIOT Act.




          (k) The interest and fees under the Existing Credit Agreement shall have been paid as accrued
on a current basis during the continuation of the Cases. All obligations under the Existing Credit
Agreement except for contingent indemnification obligations for which no claim has been made shall
have been paid in full in cash. After giving effect to the Transactions and the other transactions
contemplated hereby, the Specified U.S. Borrower and its Subsidiaries shall have outstanding no
Indebtedness or preferred stock other than (a) the loans and other extensions of credit under the
Facilities, (b) the Senior Secured Notes and (c) other Indebtedness permitted hereunder.




          (l) The Schedules hereto shall be reasonably acceptable to the Collateral Agents.




          (m) The Senior Secured Notes shall have been issued on the terms and conditions set forth in
the Approved Plan of Reorganization and to the extent not set forth in the Approved Plan of
Reorganization, on terms and conditions reasonably satisfactory to the Required Initial Lenders.



Without limiting the generality of the provisions of the last paragraph of Section 9.03,
for purposes of determining compliance with the conditions specified in this Section 4.01,
each Lender that has signed this Agreement shall be deemed to have consented to, approved or
accepted or to be satisfied with, each document or other matter required thereunder to be consented
to or approved by or acceptable or reasonably satisfactory to a Lender unless the Administrative
Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.




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





     (a) The representations and warranties of each Borrower and each other Loan Party
contained in Article V or any other Loan Document shall be true and correct in all
material respects (or in all respects in the case of any representations and warranties
qualified by materiality) on and as of the date of such Credit Extension, except to the
extent that such representations and warranties specifically refer to an earlier date, in
which case they shall be true and correct in all material respects (or in all respects in
the case of any representations and warranties qualified by materiality) as of such earlier
date, and except that for purposes of this Section 4.02, the representations and
warranties contained in Sections 5.05(a) and (b) shall be deemed to refer to
the most recent statements furnished pursuant to Sections 6.01(a) and (b),
respectively.




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




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




     (d) (i) The lesser of (A) the Total Borrowing Base and (B) the Revolving Credit
Facility, exceeds the Outstanding Amount of the Revolving Credit Loans, Swing Line Loans and
L/C Obligations at such time, after giving effect to such Credit Extension, (ii) the lesser
of (A) the U.S. Borrowing Base and (B) the U.S. Revolving Credit Facility, exceeds the
Outstanding Amount of the U.S. Revolving Credit Loans, U.S. Swing Line Loans and U.S. L/C
Obligations at such time, after giving effect to such Credit Extension and (iii) the lesser
of (A) the Canadian Borrowing Base and (B) the Canadian Revolving Credit Facility, exceeds
the Outstanding Amount of the Canadian Revolving Credit Loans, Canadian Swing Line Loans and
Canadian L/C Obligations at such time, after giving effect to such Credit Extension.



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



ARTICLE V

REPRESENTATIONS AND WARRANTIES




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



          5.01 Existence, Qualification and Power; Compliance with Laws. Each Loan Party and
each of its Subsidiaries (a) is a Person (i) duly organized or formed and, except in the case of
Excluded Subsidiaries and Foreign Subsidiaries (other than Canadian Subsidiaries), validly existing
and (ii) in good standing under the laws of the jurisdiction of its incorporation or organization,
(b) has all requisite power and authority to (i) own or lease its assets and carry on its business
and (ii) execute, deliver and perform its obligations under the Loan Documents to which it is a
party, and (c) is duly qualified and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of properties or the conduct of its business requires such
qualification, except in each case referred to in clause (a)(ii) (solely with respect to
Subsidiaries that are not Loan Parties) or (c) to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect.



          5.02 Authorization; No Contravention. The execution, delivery and performance by each
Loan Party of each Loan Document to which such Person is a party are within such Loan Party’s
corporate or other powers, have been duly authorized by all necessary corporate or other
organizational action, and do not and will not (a) contravene the terms of any of such Person’s
Organization Documents, (b) conflict with or result in any breach or contravention of, or the
creation of any Lien under (other than as permitted by Section 7.01), or require any
payment to be made under (i) any Contractual Obligation to which such Person is a party or
affecting such Person or the properties of such Person or any of its Subsidiaries or (ii) any
material order, injunction, writ or decree of any Governmental Authority or any arbitral award to
which such Person or its property is subject; or (c) violate any Law; except with respect to any
conflict, breach or contravention or payment (but not creation of Liens) referred to in clause
(b)(i), to the extent that such conflict, breach, contravention or payment could not reasonably be
expected to have a Material Adverse Effect.



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          5.03 Governmental Authorization; Other Consents. No material approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any Governmental
Authority or any other Person is necessary or required in connection with (a) the execution,
delivery or performance by, or enforcement against, any Loan Party of this Agreement or any other
Loan Document, (b) the grant by any Loan Party of the Liens granted by it pursuant to the
Collateral Documents, (c) the perfection or maintenance of the Liens created under the Collateral
Documents (including the priority thereof) or (d) the exercise by any Administrative Agent or any
Lender of its rights under the Loan Documents or the remedies in respect of the Collateral pursuant
to the Collateral Documents, except for (i) filings necessary to perfect the Liens on the
Collateral granted by the Loan Parties in favor of the Administrative Agent (which filings are
disclosed in the Perfection Certificate) or (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.



          5.04 Binding Effect. This Agreement and each other Loan Document has been duly
executed and delivered by each Loan Party that is party hereto and thereto. This Agreement and
each other Loan Document constitutes, a legal, valid and binding obligation of such Loan Party,
enforceable against each Loan Party that is party thereto in accordance with its terms, except as
such enforceability may be limited by bankruptcy insolvency, reorganization, receivership,
moratorium or other laws affecting creditors’ rights generally and by general principles of equity.



          5.05 Financial Statements; No Material Adverse Effect.



          (a) The Audited Financial Statements (i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly noted therein and (ii)
fairly present in all material respects the financial condition of the Specified U.S. Borrower and
its consolidated Subsidiaries as of the date thereof and their results of operations for the period
covered thereby in accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein.



          (b) The unaudited consolidated balance sheet of the Specified U.S. Borrower and its
Subsidiaries dated October 3, 2009, and the related consolidated statements of income or
operations, stockholder’s investment and cash flows for the fiscal quarter ended on that date (i)
were prepared in accordance with GAAP consistently applied through the period covered thereby,
except as otherwise expressly noted therein, and (ii) fairly present the financial condition of the
Specified U.S. Borrower and its Subsidiaries as of the date thereof and their results of operations
for the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of
footnotes and to normal year-end audit adjustments.



          (c) Since October 3, 2009, there has been no event or circumstance, either individually or in
the aggregate, that has had or could reasonably be expected to result in a Material Adverse Effect.



          (d) The consolidated forecasted balance sheets, statements of income and statements of cash
flows of the Specified U.S. Borrower and its Subsidiaries for, and as of the end of, each fiscal
year commencing after December 31, 2008 and ending on or prior to December 31, 2012 made available
to the Administrative Agent prior to the Closing Date were prepared in good faith on the basis of
the assumptions stated therein, which assumptions were reasonably believed by the Specified U.S.
Borrower to have been reasonable in light of the conditions existing at the time of delivery of
such forecasts; it being understood that actual results may vary from such forecasts and that such
variations may be material.



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          (e) The consolidated forecasted balance sheets, statements of income and cash flows of the
Specified U.S. Borrower and its Subsidiaries delivered pursuant to Section 4.01 or
Section 6.01(e) were prepared in good faith on the basis of the assumptions stated therein,
which assumptions were reasonably believed by the Specified U.S. Borrower to have been reasonable
in light of the conditions existing at the time of delivery of such forecasts; it being understood
that actual results may vary from such forecasts and that such variations may be material.



          5.06 Litigation. Except as set forth on Schedule 5.06, there are no actions,
suits, proceedings, claims or disputes pending or, to the knowledge of any Borrower, threatened, at
law, in equity, in arbitration or before any Governmental Authority, by or against the Specified
U.S. Borrower or any of its Subsidiaries or against any of their properties or revenues that (a)
purport to affect or pertain to this Agreement or any other Loan Document or (b) either
individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.



          5.07 No Default. None of the Specified U.S. Borrower or any Subsidiary is in default
under any Contractual Obligation that could, either individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.



          5.08 Ownership of Property; Liens.



          (a) Each Loan Party and each of its Subsidiaries has good record and indefeasible title in fee
simple to, or valid leasehold interests in, all real property necessary in the ordinary conduct of
its business, free and clear of all Liens except for minor defects in title that do not materially
interfere with its ability to conduct its business or to utilize such assets for their intended
purposes and Liens permitted by clauses (a), (b), (c), (d),
(e), (g), (h), (i), (j), (k), (n)(ii),
(o), (p), (q), (r), (s), (t), (v),
(w), (y) and (z) of Section 7.01.



          (b) Set forth on Schedule 5.08(b)is a complete and accurate list of all real property
owned by any U.S. Loan Party or any of its Subsidiaries located in the United States and material
to the conduct of the business of the U.S. Loan Parties, as of the Closing Date, showing as of the
date hereof the street address (to the extent available), county or other relevant jurisdiction,
state and record owner.



          (c) Set forth on Schedule 5.08(c)(i) is a complete and accurate list of all leases of
domestic and Canadian real property material to the conduct of the business of the Loan Parties
located in the U.S. or Canada under which any Loan Party or any of its Subsidiaries is the lessee
as of the Closing Date, showing as of the date hereof the street address, county or other relevant
jurisdiction (to the extent available), state, lessor and lessee.



          5.09 Environmental Compliance. Except as specifically disclosed on Schedule
5.09,



          (a) Each Loan Party and each of its Subsidiaries, and each of their operations and properties
is, and for the past three years, has been, in compliance with all applicable Environmental Laws
except to the extent any non-compliance could not reasonably be expected to result in liabilities,
costs and expenses in excess of (i) as of the Closing Date, $10,000,000 and (ii) at any time after
the Closing Date, $25,000,000.



          (b) Except as could not reasonably be expected to result in liabilities, costs and expenses in
excess of (i) as of the Closing Date, $10,000,000 and (ii) at any time after the Closing Date,
$25,000,000, there are no pending actions, claims, notices of violation or potential
responsibility, or proceedings alleging liability under or non-compliance with any Environmental
Law on the part of any Loan Party or any of its Subsidiaries.



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          (c) Except as could not reasonably be expected to have a Material Adverse Effect, (i) none of
the properties currently or, to the knowledge of any Loan Party formerly, owned or operated by any
Loan Party or any of its Subsidiaries is listed or to the knowledge of any Loan Party proposed for
listing on the NPL or on the CERCLIS or any analogous foreign, state, provincial, territorial,
municipal or local list; (ii) there are no and never have been any underground or aboveground
storage tanks or any surface impoundments, septic tanks, pits, sumps or lagoons in which Hazardous
Materials are being or have been treated, stored or disposed on any property currently owned or
operated by any Loan Party or any of its Subsidiaries or, to its knowledge, on any property
formerly owned or operated by any Loan Party or any of its Subsidiaries in each case, that would
reasonably be expected to result in a material liability; (iii) there is no asbestos or
asbestos-containing material in friable form or condition on any property currently owned or
operated by any Loan Party or any of its Subsidiaries; and (iv) Hazardous Materials have not been
Released on, under or from any property currently or, to their knowledge, formerly owned or
operated by any Loan Party or any of its Subsidiaries except for such releases, discharges or
disposal that were in material compliance with Environmental Laws.



          (d) None of the properties of the Loan Parties contain any Hazardous Materials in amounts or
concentrations which (i) constitute a violation of or (ii) could give rise to liability under,
Environmental Laws, which violations and liabilities, in the aggregate, could reasonably be
expected to result in a Material Adverse Effect.



          (e) Neither any Loan Party nor any of its Subsidiaries is undertaking, and has not completed,
either individually or together with other potentially responsible parties, any investigation or
assessment or response or other corrective action relating to any actual or threatened Release of
Hazardous Materials at, on, under or from any location, either voluntarily or pursuant to the order
of any Governmental Authority or the requirements of any Environmental Law except for any such
investigations, assessments, responses or other actions that, in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.



          (f) All Hazardous Materials generated, used, treated, handled or stored at, or transported to
or from, any property currently or formerly owned or operated by any Loan Party or any of its
Subsidiaries have been disposed of in a manner which would not reasonably expected to result in a
Material Adverse Effect.



          5.10 Insurance. The properties of each Loan Party and its Subsidiaries are insured
with financially sound and reputable insurance companies, in such amounts (after giving effect to
any self-insurance reasonable and customary for similarly situated Persons engaged in the same or
similar businesses as Specified U.S. Borrower and its Subsidiaries) with such deductibles and
covering such risks as are customarily carried by prudent companies engaged in similar businesses
and owning similar properties in localities where each Loan Party or the applicable Subsidiary
operates and as required by Section 6.07 and Section 6.18(b)(iii).



          5.11 Taxes. Each Loan Party and its Subsidiaries have filed all federal, provincial,
state, territorial, foreign and other tax returns and reports required to be filed, and have paid
or made provision for all federal, provincial, state, territorial and other taxes, assessments,
fees and other governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those (a) which are not overdue by more than thirty (30)
days, (b) which are being contested in good faith by appropriate proceedings diligently conducted
and for which adequate reserves have been provided in accordance with GAAP or (c) the failure of
which to file or pay could not reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect.



          5.12 ERISA Compliance.



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



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



          (c) (i) Except with respect to a Reportable Event arising as a result of the Cases, no ERISA
Event has occurred within the prior 2 years or is reasonably expected to occur; (ii) no Pension
Plan has an “accumulated funding deficiency” (as defined in Section 412 of the Code), whether or
not waived, and no application for a waiver of the minimum funding standard has been filed with
respect to any Pension Plan; (iii) neither any Loan Party nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan
(other than premiums due and not delinquent under Section 4007 of ERISA); (iv) neither any Loan
Party nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no
event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in
such liability) under Sections 4201 or 4243 of ERISA with respect to a Multiemployer Plan; (v)
neither any Loan Party nor any ERISA Affiliate has engaged in a transaction that could be subject
to Sections 4069 or 4212(c) of ERISA; and (vi) the present value of all accumulated benefit
obligations of all underfunded Pension Plans (based on the assumptions used for purposes of
Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed by more than $80,000,000 the fair market value
of the assets of all such underfunded Pension Plans; except, with respect to each of the foregoing
clauses of this Section 5.12(c), as could not reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Effect.



          (d) Except where noncompliance would not reasonably be expected to result in a Material
Adverse Effect, each Foreign Plan has been maintained in substantial compliance with its terms and
with the requirements of any and all applicable laws, statutes, rules, regulations and orders and
has been maintained, where required, in good standing with applicable Governmental Authorities, and
neither the Specified U.S. Borrower nor any Subsidiary have incurred any material obligation in
connection with the termination of or withdrawal from any Foreign Plan.



          5.13 Subsidiaries; Equity Interests; Loan Parties. As of the Closing Date, each Loan
Party has no Subsidiaries other than those specifically disclosed in Schedule 5.13, and all
of the outstanding Equity Interests in such Subsidiaries have been validly issued, are fully paid
and non-assessable and are owned free and clear of all Liens except (i) those created under the
Collateral Documents and (ii) any nonconsensual Lien that is permitted under Section 7.01
and consensual Liens under Sections 7.01(n), (o), (p) and (q). As
of the Closing Date, no Loan Party has any equity investments in any other corporation or entity
other than those specifically disclosed in Schedule 5.13.



          5.14 Margin Regulations; Investment Company Act.



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          (a) The Borrowers are not engaged and will not engage, principally or as one of their
important activities, in the business of purchasing or carrying margin stock (within the meaning of
Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying
margin stock and no Credit Extension will be used to purchase or carry any margin stock or to
extend credit to others for the purpose of purchasing or carrying any margin stock. The Borrowers
do not own any margin stock.



          (b) None of the Specified U.S. Borrower, any Person Controlling the Specified U.S. Borrower or
any Subsidiary is or is required to be registered as an “investment company” under the Investment
Company Act of 1940.



          5.15 Disclosure. No report, financial statement, certificate or other information
(including, without limitation, the Information Memorandum) furnished by or on behalf of any Loan
Party to the Administrative Agent or any Lender in connection with the transactions contemplated
hereby and the negotiation of this Agreement or delivered hereunder or any other Loan Document (as
modified or supplemented by other information so furnished) contains any material misstatement of a
material fact or omits to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not materially misleading; provided
that (i) no representation is made with respect to general economic or industry information and
(ii) with respect to projected financial information, the Specified U.S. Borrower represents only
that such information was prepared in good faith based upon assumptions reasonably believed by the
Specified U.S. Borrower to be reasonable at the time of preparation; it being understood that such
projections may vary from actual results and that such variances may be material.



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



          5.17 Intellectual Property; Licenses, Etc. Each Loan Party and its Subsidiaries own,
or possess the right to use, all of the trademarks, service marks, trade names, copyrights,
patents, patent rights and other intellectual property rights (collectively, “IP Rights”)
and franchises and operating licenses that are reasonably necessary for the operation of their
respective businesses, without, to the knowledge of the Borrowers, conflict with the rights of any
other Person, except to the extent such conflicts or failures to own or possess such rights, either
individually or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect. To the knowledge of the Borrowers, no slogan or other advertising device, product,
process, method, substance, part or other material now employed, or now contemplated to be
employed, by any Loan Party or any Subsidiary infringes upon any intellectual property rights held
by any other Person except for such infringements, individually or in the aggregate, which could
not reasonably be expected to have a Material Adverse Effect. No claim or litigation regarding any
of the foregoing is pending or, to the knowledge of the Borrowers, threatened in writing, which,
either individually or in the aggregate, could reasonably be expected to have a Material Adverse
Effect.



          5.18 Solvency. Each Loan Party that is not an Excluded Subsidiary is, individually
and together with its Subsidiaries on a consolidated basis, Solvent.



          5.19 Casualty, Etc. Neither the business nor the properties of any Loan Party or any
of its Subsidiaries are affected by any fire, explosion, accident, strike, lockout or other labor
dispute,



106









 




drought, storm, hail, earthquake, embargo, act of God or of the public enemy or other casualty
that could reasonably be expected to have a Material Adverse Effect.




          5.20 Perfection, Etc. All filings and other actions necessary or desirable to perfect
and protect the Liens in the Collateral created under the Collateral Documents and to render such
Liens opposable to third parties have been or will be, during the periods required by the Loan
Documents, duly made or taken and are in full force and effect, and the Collateral Documents are
effective to create in favor of (i) the Administrative Agent for the benefit of the U.S. Secured
Parties and (ii) the Administrative Agent for the benefit of the Canadian Secured Parties, a valid
and, together with such filings and other actions, perfected first priority (in the case of ABL
Priority Collateral) or second priority (in the case of Term Priority Collateral) Lien in the U.S.
Collateral and the Canadian Collateral, respectively, securing the payment of the Secured
Obligations (in the case of the U.S. Collateral) and the Canadian Obligations (in the case of the
Canadian Collateral), subject to Liens permitted by Section 7.01. The Loan Parties are the
legal and beneficial owners of the Collateral free and clear of any Lien, except for the Liens
created under the Loan Documents and permitted by Section 7.01.



          5.21 [Reserved].



          5.22 Tax Shelter Regulations. The Specified U.S. Borrower does not intend to treat
the Loans and/or Letters of Credit and related transactions as being a “reportable transaction”
(within the meaning of Treasury Regulation Section 1.6011-4). In the event the Specified U.S.
Borrower determines to take any action inconsistent with such intention, it will promptly notify
the Administrative Agent thereof. If the Specified U.S. Borrower so notifies the Administrative
Agent, the Specified U.S. Borrower acknowledges that one or more of the Lenders may treat its Loans
and/or its interest in Swing Line Loans and/or Letters of Credit as part of a transaction that is
subject to Treasury Regulation Section 301.6112-1, and such Lender or Lenders, as applicable, may
maintain the lists and other records required by such Treasury Regulation.



          5.23 Anti-Terrorism Law.



          (a) No Loan Party and, to the knowledge of the Borrowers, none of their Affiliates is in
violation of any laws relating to terrorism or money laundering (“Anti-Terrorism Laws”),
including Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001 (the
“Executive Order”), the Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56 or the Proceeds of
Crime (Money-Laundering) and Terrorist Financing Act (Canada).



          (b) No Loan Party and to the knowledge of the Loan Parties, no Affiliate or broker or other
agent of any Loan Party acting or benefiting in any capacity in connection with the Loans is any of
the following:




     (i) a person that is listed in the annex to, or is otherwise subject to the provisions
of, the Executive Order;




     (ii) to the knowledge of the Loan Parties, a person owned or controlled by, or acting
for or on behalf of, any person that is listed in the annex to, or is otherwise subject to
the provisions of, the Executive Order;




     (iii) a person with which any Lender is prohibited from dealing or otherwise engaging
in any transaction by any Anti-Terrorism Law;



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     (iv) a person that commits, threatens or conspires to commit or supports “terrorism” as
defined in the Executive Order; or




     (v) a person that is named as a “specially designated national and blocked person” on
the most current list published by the U.S. Treasury Department Office of Foreign Assets
Control (“OFAC”) at its official website or any replacement website or other
replacement official publication of such list or similarly named by any similar foreign
Governmental Authority.



          (c) No Loan Party and, to the knowledge of the Borrowers, no broker or other agent of any Loan
Party acting in any capacity in connection with the Loans (i) conducts any business or engages in
making or receiving any contribution of funds, goods or services to or for the benefit of any
person described in paragraph (b) above, (ii) deals in, or otherwise engages in any transaction
relating to, any property or interests in property blocked pursuant to the Executive Order, or
(iii) engages in or conspires to engage in any transaction that evades or avoids, or has the
purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any
Anti-Terrorism Law.



          5.24 Accounts. Without limiting the provisions of Section 5.15 or the
statements contained in any Borrowing Base Certificate, each Borrower hereby represents and
warrants that the statements in each Borrowing Base Certificate are or will be when such Borrowing
Base Certificate is delivered true and correct in all respects. The Administrative Agent may rely,
in determining which Accounts are Eligible Receivables, on all statements and representations made
by the Borrowers with respect thereto. Each Borrower warrants, with respect to each Account at the
time it is shown as an Eligible Receivables in a Borrowing Base Certificate, that:




     (a) it is genuine and in all respects what it purports to be, and is not evidenced by a
judgment;




     (b) it arises out of a completed, bona fide sale and delivery of goods or performance
of services in the ordinary course of business, and substantially in accordance with any
purchase order, contract or other document relating thereto;




     (c) it is for a sum certain, maturing as stated in the invoice covering such sale, a
copy of which has been furnished or is available to the Administrative Agent on request;




     (d) it is not subject to any offset, Lien (other than the Administrative Agent’s Lien),
deduction, defense, dispute, counterclaim or other adverse condition except as arising in
the ordinary course of business and disclosed to the Administrative Agent; and it is
absolutely owing by the Account Debtor, without any other contingency in any respect;




     (e) no purchase order, agreement, document or applicable Law effectively restricts
assignment of the Account to the Administrative Agent (after giving effect to the provisions
of the UCC or the PPSA, as applicable), and the applicable Borrower is the sole payee or
remittance party shown on the invoice;




     (f) no extension, compromise, settlement, modification, credit, deduction or return has
been authorized with respect to the Account, except discounts or allowances granted in the
ordinary course of business for prompt payment that are reflected on the face of the invoice
related thereto and in the reports submitted to the Administrative Agent hereunder; and




     (g) to the best of each Borrower’s knowledge, (i) there are no facts or circumstances
that are reasonably likely to impair the enforceability or collectibility of such Account;
(ii) the



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Account Debtor had the capacity to contract when the Account arose, continues to meet
the applicable Borrower’s customary credit standards, is Solvent, is not contemplating or
subject to a proceeding under any Debtor Relief Laws, and has not failed, or suspended or
ceased doing business; and (iii) there are no proceedings or actions threatened or pending
against any Account Debtor that could reasonably be expected to have a material adverse
effect on the Account Debtor’s financial condition.



          5.25 Canadian Pension Plans. The Canadian Pension Plans are duly registered under the
Income Tax Act (Canada) and all other applicable laws which require registration and no event has
occurred which is reasonably likely to cause the loss of such registered status. All material
obligations of each Loan Party (including fiduciary, funding, investment and administration
obligations) required to be performed in connection with the Canadian Pension Plans and Canadian
Benefit Plans and any funding agreements therefor have been performed in a timely fashion, except
where (i) the failure to do so could not reasonably be expected to have a Material Adverse Effect
and (ii) no Lien (other than Liens permitted pursuant to Section 7.01) is created thereby.
No Termination Event has occurred that could reasonably be expected to have a Material Adverse
Effect. There have been no improper withdrawals or applications of the assets of the Canadian
Pension Plans or the Canadian Benefit Plans by any Loan Party or its Affiliates except where such
withdrawals or applications could not reasonably be expected to have a Material Adverse Effect.
There are no material outstanding disputes involving any Loan Party or its Affiliates concerning
the assets of the Canadian Pension Plans or the Canadian Benefit Plans except where such disputes
could not reasonably be expected to have a Material Adverse Effect. Except as disclosed in
Schedule 5.25 hereto based on the most recent actuarial valuations filed with Government
Authorities, each of the Canadian Pension Plans was fully funded on a solvency basis as of the date
of such actuarial valuations.



ARTICLE VI

AFFIRMATIVE COVENANTS




          So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation
hereunder (other than any contingent indemnification obligation as to which no claim has been
asserted) shall remain unpaid or unsatisfied, or any Letter of Credit (other than Letters of Credit
as to which arrangements reasonably satisfactory to the Administrative Agent and the applicable L/C
Issuer shall have been made) shall remain outstanding, each of the Specified U.S. Borrower shall,
and shall (except in the case of the covenants set forth in Sections 6.01, 6.02 and
6.03) cause each Subsidiary to:



          6.01 Financial Statements. Deliver to the Administrative Agent for further
distribution to each Lender:




     (a) as soon as available, but in any event within one hundred and five (105) days after
the end of each fiscal year of the Specified U.S. Borrower (or, if earlier, the date on
which the Specified U.S. Borrower’s Form 10 or 10-K would be required to be filed with the
SEC (after giving effect to any extension permitted by the SEC)), a consolidated balance
sheet of the Specified U.S. Borrower and its Subsidiaries as at the end of such fiscal year,
and the related consolidated statements of income or operations, changes in stockholder’s
investment, and cash flows for such fiscal year, setting forth in each case in comparative
form the figures for the previous fiscal year, all in reasonable detail and prepared in
accordance with GAAP, audited and accompanied by a report and opinion of Ernst & Young, LLP
or any other independent certified public accountant of nationally recognized standing,
which report and opinion shall be prepared in accordance with generally accepted auditing
standards and shall not be subject to any “going concern” or like qualification or exception
or any qualification or exception as to the scope of such audit;



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     (b) as soon as available, but in any event within forty-five (45) days after the end of
each of the first three (3) fiscal quarters of each fiscal year of the Specified U.S.
Borrower (or, if later, if a Form 12b-25 has been duly filed with the SEC, the date on which
the Specified U.S. Borrower’s Form 10 or 10-Q would be required to be filed with the SEC
(after giving effect to any extension permitted by the SEC)), a consolidated balance sheet
of the Specified U.S. Borrower and its Subsidiaries as at the end of such fiscal quarter,
and the related consolidated statements of income or operations, changes in stockholders’
investment, and cash flows for such fiscal quarter and for the portion of the fiscal year
then ended, setting forth in each case in comparative form the figures for the corresponding
fiscal quarter of the previous fiscal year and the corresponding portion of the previous
fiscal year, all in reasonable detail and certified by a Responsible Officer of the
Specified U.S. Borrower as fairly presenting in all material respects the financial
condition, results of operations, shareholders’ equity and cash flows of the Specified U.S.
Borrower and its Subsidiaries in accordance with GAAP, subject only to normal year-end audit
adjustments and the absence of footnotes;




     (c) as soon as available, but in any event within thirty (30) days after the end of
each of the first 11 months of each fiscal year of the Specified U.S. Borrower, a
consolidated balance sheet of the Specified U.S. Borrower and its Subsidiaries as of the end
of such month, and the related consolidated statements of income or operations, for such
month, in the form customarily prepared by management of the Specified U.S. Borrower for
delivery to investors;




     (d) at the time of delivery of the financial statements provided for in Sections
6.01(a) and (b) above, a management’s discussion and analysis of the financial
condition and results of operation for such fiscal quarter or fiscal year, as the case may
be, as compared to the previous fiscal period; provided that a copy of the Specified
U.S. Borrower’s Form 10 or 10-K or Form 10-Q for the applicable period shall be deemed to
satisfy such requirement;




     (e) as soon as available, but in any event no later than seventy-five (75) days after
the end of each fiscal year, forecasts prepared by management of the Specified U.S.
Borrower, in form reasonably satisfactory to the Administrative Agent, of consolidated
balance sheets, income statements and cash flow statements of the Specified U.S. Borrower
and its Subsidiaries. All forecasts delivered hereunder shall be prepared on an annual
basis for the fiscal year following such fiscal year then ended);




     (f) On or before the 20th day after the end of each fiscal month of the Specified U.S.
Borrower (unless such monthly Borrowing Base Certificate shall not be required to be
furnished pursuant to the second succeeding sentence), the Borrower Agent shall deliver to
the Administrative Agent (and the Administrative Agent shall promptly deliver same to the
Lenders) a Borrowing Base Certificate in respect of each of the U.S. Borrowing Base and the
Canadian Borrowing Base, prepared as of the close of business of the previous month and at
such other times as the Administrative Agent may request. All calculations of Excess
Availability in any Borrowing Base Certificate shall originally be made by the Borrowers and
certified by a Responsible Officer of each of the Specified U.S. Borrower and the Canadian
Borrower, provided that the Collateral Agents may from time to time review and
adjust any such calculation in their Credit Judgment to the extent the calculation is not
made in accordance with this Agreement or does not accurately reflect the Availability
Reserve. Upon the occurrence and during the continuation of a Cash Dominion Event, or if
otherwise requested by any of the Collateral Agents in its discretion, the Borrowers shall
deliver to the Collateral Agents a weekly Borrowing Base Certificate within five (5)
Business Days after the end of each calendar week (each calendar week deemed, for purposes
hereof, to end on a Friday), updated to reflect each Borrowing Base as of the close of
business on the last Business Day of the immediately preceding calendar week (it



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being understood that inventory amounts shown in such Borrowing Base Certificate will
be based on the inventory amount for the most recently ended month and that the amount of
Eligible Receivables shown in such Borrowing Base Certificate will be based on the amount of
gross receivables set forth in the most recent biweekly report, less the amount of
ineligible receivables reported for the most recently ended month) unless the Collateral
Agents otherwise agree; provided that to the extent the weekly Borrowing Base
Certificate for the last week of a calendar month shall include calculations for such month,
no monthly Borrowing Base Certificate shall be required to be delivered for such month.
Borrowing Base Certificates shall be delivered with such inventory back-up data, borrowing
base validating information, supporting documentation and additional reports with respect to
the U.S. Borrowing Base and the Canadian Borrowing Base as any of the Collateral Agents
shall reasonably request.



          6.02 Certificates; Other Information. Deliver to the Administrative Agent for further
distribution to each Lender, in form and detail reasonably satisfactory to the Collateral Agents:




     (a) to the extent available, no later than five (5) days after the delivery of the
financial statements referred to in Section 6.01(a), a certificate of its
independent certified public accountants certifying such financial statements and stating
that in making the examination necessary therefor no knowledge was obtained of any Event of
Default resulting from non-compliance with Section 7.11 or, if any such Event of
Default shall exist, stating the nature and status of such event (provided that the
Specified U.S. Borrower shall use commercially reasonable efforts to obtain such
certificate);




     (b) concurrently with the delivery of the financial statements referred to in
Sections 6.01(a) and (b), (i) a duly completed Compliance Certificate signed
by a Responsible Officer of the Specified U.S. Borrower including (x) calculations
demonstrating compliance with the Consolidated Fixed Charge Coverage Ratio, whether or not a
Covenant Trigger Event has occurred and is continuing and (y) during each Covenant Trigger
Event, in the event of any change in generally accepted accounting principles used in the
preparation of such financial statements, if necessary for the determination of compliance
with Section 7.11, a statement of reconciliation conforming such financial
statements to GAAP and (ii) a description of each event, condition or circumstance during
the last fiscal quarter covered by such Compliance Certificate requiring a mandatory
prepayment under Section 2.05(b);




     (c) promptly after the same are available, (i) copies of each annual report, proxy or
financial statement or other report or communication sent to the stockholders of the
Specified U.S. Borrower, (ii) copies of all annual, regular, periodic and special reports
and registration statements which the Specified U.S. Borrower (and any direct or indirect
parent entity) may file or be required to file, copies of any report, filing or
communication with the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934,
or with any national securities exchange, and (iii) a copy of any final “management letter”
received by any Loan Party from its certified public accountants identifying any significant
deficiencies in the design or operation of internal controls which could materially
adversely affect the Specified U.S. Borrower’s ability to record, process, summarize and
report financial data, and the management’s responses thereto (provided that such
disclosure by the Specified U.S. Borrower is authorized by such accountants (and the
Specified U.S. Borrower agrees to request that such certified public accountants permit such
disclosure));




     (d) promptly after the furnishing thereof, copies of any requests or notices received
by any Loan Party (other than in the ordinary course of business) from, or statements or
reports furnished to, any holder of debt securities of any Loan Party or of any of its
Subsidiaries pursuant



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to the terms of any Junior Financing Documentation or the Senior
Secured Notes, in each case, in a principal amount greater than the Threshold Amount and not otherwise required to be
furnished to the Lenders pursuant to any other clause of this Section 6.02;




     (e) promptly after the receipt thereof by any Loan Party or any of its Subsidiaries,
copies of each notice or other correspondence received from the SEC (or comparable agency in
any applicable non-U.S. jurisdiction) concerning any material investigation or other
material inquiry by such agency regarding financial or other operational results of any Loan
Party or any of its Subsidiaries;




     (f) promptly after the assertion or occurrence thereof, notice of any occurrence, event
or action that could result in a material Environmental Liability on the part of any Loan
Party or any of its Subsidiaries or of any noncompliance by any Loan Party or any of its
Subsidiaries with any Environmental Law or Environmental Permit;




     (g) concurrently with any delivery of financial statements under Section
6.01(a), a certificate of a Responsible Officer setting forth the information required
pursuant to the Perfection Certificate Supplement or confirming that there has been no
change in such information since the date of the Perfection Certificate or latest Perfection
Certificate Supplement;




     (h) promptly after U.S. Borrower has notified the Administrative Agent of any intention
by U.S. Borrower to treat the Loans and/or Letters of Credit and related transactions as
being a “reportable transaction” (within the meaning of Treasury Regulation Section
1.6011-4), a duly completed copy of IRS Form 8886 or any successor form;




     (i) upon request by the Administrative Agent, copies of: (i) each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) filed by any Loan Party or
ERISA Affiliate with the Internal Revenue Service with respect to each Pension Plan; (ii)
the most recent actuarial valuation report for each Pension Plan; (iii) all notices received
by any Loan Party or ERISA Affiliate from a Multiemployer Plan sponsor or any governmental
agency concerning an ERISA Event; (iv) such other documents or governmental reports or
filings relating to any Plan as the Administrative Agent shall reasonably request; and (v)
each annual information return to be filed in accordance with the applicable pension
standards legislation in connection with each Canadian Pension Plan;




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




     (k) promptly after the application of net cash proceeds of any transaction or event in
the manner contemplated by clause (b) of the definition of “Not Otherwise Applied”, a
description of such application.



          Documents required to be delivered pursuant to Section 6.01(a), (b),
(c), (d) or (e) or Section 6.02(d) (to the extent any such
documents are included in materials otherwise filed with the SEC) may be delivered electronically
and if so delivered, shall be deemed to have been delivered on the date (i) on which the Specified
U.S. Borrower posts such documents, or provides a link thereto on the Specified U.S. Borrower’s
website on the Internet at the website address listed on Schedule 11.02; or (ii) on which
such documents are posted on the Specified U.S. Borrower’s behalf on IntraLinks/



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IntraAgency or
another relevant website, if any, to which each Lender and each Administrative Agent have access
(whether a commercial, third-party website or whether sponsored by an Administrative Agent);
provided that (i) the Specified U.S. Borrower shall deliver paper or electronic copies of
such documents to the Administrative Agent for further distribution to each Lender until a written
request to cease delivering such copies is given by the each Administrative Agent or such Lender
and (ii) the Specified U.S. Borrower shall notify (which may be by facsimile or electronic mail)
each Administrative Agent of the posting of any such documents and provide to each Administrative
Agent by electronic mail electronic versions (i.e., soft copies) of such documents.
Notwithstanding anything contained herein, in every instance U.S. Borrower shall be required to
provide paper or electronic copies of the Compliance Certificates required by Section
6.02(b) to the Administrative Agent. Except for such Compliance Certificates, the
Administrative Agent shall have no obligation to request the delivery or to maintain copies of the
documents referred to above, and in any event shall have no responsibility to monitor compliance by
any Borrower with any such request for delivery, and each Lender shall be solely responsible for
requesting delivery to it or maintaining its copies of such documents.




          Each Borrower hereby acknowledges that (a) the Administrative Agent and/or the Bookrunners
will make available to the Lenders and the L/C Issuers materials and/or information provided by or
on behalf of the Borrowers hereunder (collectively, “Borrower Materials”) by posting the
Borrower Materials on IntraLinks or another similar electronic system (the “Platform”) and
(b) certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to
receive material non-public information with respect to the Borrowers or their Affiliates, or the
respective securities of any of the foregoing, and who may be engaged in investment and other
market-related activities with respect to such Persons’ securities. Each Borrower hereby agrees
that it will use commercially reasonable efforts to identify that portion of the Borrower Materials
that may be distributed to the Public Lenders and that (w) all such Borrower Materials shall be
clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC”
shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,”
each Borrower shall be deemed to have authorized the Administrative Agent, the Bookrunners, the L/C
Issuers and the Lenders to treat such Borrower Materials as not containing any material non-public
information (although it may be sensitive and proprietary) with respect to the Borrowers or their
securities for purposes of United States federal and state securities laws (provided,
however, that to the extent such Borrower Materials constitute Information, they shall be
treated as set forth in Section 11.07); (y) all Borrower Materials marked “PUBLIC” are
permitted to be made available through a portion of the Platform designated “Public Side
Information;” and (z) the Administrative Agent and the Bookrunners shall be entitled to treat any
Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of
the Platform not designated “Public Side Information.”



          6.03 Notices. Promptly after obtaining knowledge thereof notify the Administrative
Agent for further distribution to each Lender:




     (a) of the occurrence of any Default;




     (b) of any matter that has resulted or could reasonably be expected to result in a
Material Adverse Effect, including arising out of or resulting from (i) breach or
non-performance of, or any default under, a Contractual Obligation of any Loan Party or any
Subsidiary, (ii) any dispute, litigation, investigation, proceeding or suspension between
any Loan Party or any Subsidiary and any Governmental Authority, (iii) the commencement of,
or any material development in, any other litigation or proceeding affecting any Loan Party
or any Subsidiary, including pursuant to any applicable Environmental Laws and or in respect
of IP Rights, or (iv) the occurrence of any ERISA Event or similar event of noncompliance
with respect to a Foreign Plan; and



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     (c) of the (i) occurrence of any Disposition of Collateral for which a Borrower is
required to make a mandatory prepayment pursuant to Section 2.05 or (ii) receipt of
any Extraordinary Receipt for which a Borrower is required to make a mandatory prepayment
pursuant to Section 2.05.



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



          6.04 Payment of Obligations. Pay, discharge or otherwise satisfy within 30 days after
the date when the same shall become due (a) all Tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, unless and to the extent that (i) the same
are being contested in good faith by appropriate proceedings diligently conducted and adequate
reserves in accordance with GAAP are being maintained by the Borrowers or such Subsidiary or (ii)
the failure to pay the same could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect and (b) all lawful claims which, if unpaid, would by law become a
Lien upon its property, unless and to the extent that (i) such claims are being contested in good
faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP
are being maintained by the Borrowers or such Subsidiary or (ii) the failure to pay the same could
not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.



          6.05 Preservation of Existence, Etc. (a) Except in the case of Excluded Subsidiaries
and Foreign Subsidiaries that are not Canadian Subsidiaries, preserve, renew and maintain in full
force and effect its legal existence under the Laws of the jurisdiction of its organization or
formation except in a transaction permitted by Section 7.04 or 7.05 or, with
respect to Subsidiaries that are not Loan Parties, to the extent the failure to do so could not
reasonably be expected to have a Material Adverse Effect, (b) take all reasonable action to
maintain all rights, privileges (including its good standing), permits, licenses and franchises
necessary in the normal conduct of its business, except to the extent that failure to do so could
not reasonably be expected to have a Material Adverse Effect, and (c) preserve or renew all of its
registered patents, trademarks, trade names and service marks, the non-preservation of which could
reasonably be expected to have a Material Adverse Effect.



          6.06 Maintenance of Properties. (a) Maintain, preserve and protect all of its
material properties and equipment necessary in the operation of its business in good working order,
repair and condition, ordinary wear and tear excepted and casualty or condemnation excepted, and
(b) make all necessary renewals, replacements, modifications, improvements, upgrades, extensions
and additions thereof or thereto in accordance with prudent industry practice, except to the
extent, in the case of each of clauses (a) and (b), that the failure to do so could not reasonably
be expected to have a Material Adverse Effect.



          6.07 Maintenance of Insurance. Maintain (a) with financially sound and reputable
insurance companies, insurance with respect to its properties and business against loss or damage
of the kinds customarily insured against by Persons engaged in the same or similar business, of
such types and in such amounts (after giving effect to any self-insurance reasonable and customary
for similarly situated Persons engaged in the same or similar businesses as the Specified U.S.
Borrower and its Subsidiaries) as are customarily carried under similar circumstances by such other
Persons and (b) without limitation to the foregoing the insurance arrangements in respect of the
Collateral required by the Security Agreements. If any portion of any building on real property
subject to any Mortgage is located in an area



114









 




identified by the Federal Emergency Management Agency as an area having special flood hazards
and in which flood insurance has been made available under the National Flood Insurance Act of 1968
(or any amendment or successor act thereto), then the applicable Loan Party (or its relevant
Subsidiary) shall maintain, or cause to be maintained, with a financially sound and reputable
insurer, flood insurance in an amount sufficient to comply with all applicable rules and
regulations promulgated pursuant to such Act.




          6.08 Compliance with Laws. Comply in all material respects with the requirements of
all Laws and all orders, writs, injunctions and decrees applicable to it or to its business or
property, except if the failure to comply therewith could not reasonably be expected to have a
Material Adverse Effect.



          6.09 Books and Records. Maintain proper books of record and account, in which full,
true and correct entries shall be made of all financial transactions and matters involving the
assets and business of the Specified U.S. Borrower or such Subsidiary, as the case may be, to
enable the preparation of the financial statements in accordance with GAAP.



          6.10 Inspections; Appraisals.



          (a) Permit the Administrative Agent from time to time, subject (except when an Event of
Default has occurred and is continuing) to reasonable notice and normal business hours, to visit
and inspect the properties of any Borrower or Subsidiary, inspect, audit and make extracts from any
Borrower’s or Subsidiary’s books and records, and discuss with its officers, employees, agents,
advisors and independent accountants such Borrower’s or Subsidiary’s business, financial condition,
assets, prospects and results of operations. Lenders may participate in any such visit or
inspection, at their own expense. Neither the Administrative Agent nor any Lender shall have any
duty to any Borrower to make any inspection, nor to share any results of any inspection, appraisal
or report with any Borrower. Borrowers acknowledge that all inspections, appraisals and reports
are prepared by the Administrative Agent and Lenders for their purposes, and Borrowers shall not be
entitled to rely upon them.



          (b) Reimburse the Administrative Agent for all charges, costs and expenses of the
Administrative Agent in connection with (i) examinations of any Loan Party’s books and records or
any other financial or Collateral matters as the Administrative Agent deems appropriate, up to
twice per fiscal year; and (ii) appraisals of Inventory up to twice per fiscal year (or, in each
case with respect to clauses (i) and (ii) three times per fiscal year if the third audit and/or
appraisal occurs during a period when Excess Availability is less than 25% of the Total Borrowing
Base); provided, however, that if an examination or appraisal is initiated while an
Event of Default has occurred and is continuing, all charges, costs and expenses therefor shall be
reimbursed by Borrowers without regard to such limits. Subject to and without limiting the
foregoing, Borrowers specifically agree to pay the Administrative Agent’s then standard charges for
each day that an employee of the Administrative Agent or its branches or Affiliates is engaged in
any examination activities, and shall pay the standard charges of the Administrative Agent’s
internal appraisal group. This Section shall not be construed to limit the Administrative Agent’s
right to conduct examinations or to obtain appraisals at any time in its discretion, nor to use
third parties for such purposes.



          6.11 Use of Proceeds. The Borrowers will use the proceeds of each Credit Extension
(i) to refinance and replace the Existing Credit Agreement, (ii) for working capital and other
general corporate purposes of the Specified U.S. Borrower and its Subsidiaries, (iii) for the
payment of fees and expenses incurred in connection with the Transactions and (iv) to pay all other
amounts expressly permitted under the Approved Plan of Reorganization.



          6.12 Covenant to Guarantee Obligations and Give Security. (a) Upon the formation or
acquisition of any new direct or indirect Subsidiaries (other than Excluded Subsidiaries) by any
U.S.



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Loan Party or upon any Domestic Subsidiary ceasing to meet the definition of an Excluded
Subsidiary or upon the acquisition of any Material Real Estate, or, subject to the terms of the
Intercreditor Agreement, upon the granting of any Lien to secure the Senior Secured Notes (in which
case if the assets covered thereby do not constitute ABL Priority Collateral the provisions of this
Section shall be deemed to refer to a second-priority security interest junior to the Lien securing
the Senior Secured Notes on the terms set forth in the Intercreditor Agreement), the Borrower Agent
shall promptly notify the Administrative Agent thereof and if such property, in the reasonable
judgment of the Administrative Agent, shall not already be subject to a perfected Lien in favor of
the Administrative Agent, for the benefit of the Secured Parties, then the applicable Loan Parties
shall, in each case at the applicable Borrower’s expense:





     (i) in connection with the formation or acquisition of a Subsidiary (other than an
Excluded Subsidiary) or upon any Domestic Subsidiary which was an Excluded Subsidiary
ceasing for any reason to meet the definition thereof, within thirty (30) days after such
formation, acquisition, or change of status or such longer period as the Administrative
Agent may agree in its sole discretion, (A) cause each such Subsidiary that is not a Foreign
Subsidiary (or a Subsidiary of a Foreign Subsidiary) to duly execute and deliver to the
Administrative Agent a guaranty or guaranty supplement, in form and substance reasonably
satisfactory to the Administrative Agent, guaranteeing the other Loan Parties’ obligations
under the Loan Documents, and (B) subject to Section 6.12(d), deliver all
certificates representing the Pledged Equity of each such Subsidiary directly owned by a
U.S. Loan Party, accompanied by undated stock powers or other appropriate instruments of
transfer executed in blank, and all instruments evidencing the Pledged Debt of each such
Subsidiary owned by a U.S. Loan Party, indorsed in blank to the Administrative Agent,
together with, if requested by the Administrative Agent, supplements to the U.S. Security
Agreement with respect to the pledge of any Equity Interests or Indebtedness;
provided that no U.S. Loan Party shall be required to pledge any Equity Interests in
any Foreign Subsidiary which, when aggregated with all of the other Equity Interests in such
Foreign Subsidiary pledged by any U.S. Loan Party, would result in more than 66% of the
total combined voting power of all classes of Equity Interests in a Foreign Subsidiary
entitled to vote being pledged to the Administrative Agent, on behalf of the Secured
Parties, under the Loan Documents,




     (ii) within ten (10) days after such request, formation or acquisition, or such longer
period as the Administrative Agent may agree in its sole discretion, furnish to the
Administrative Agent a Perfection Certificate Supplement,




     (iii) within thirty (30) days after such request, formation or acquisition or change of
status, or such longer period as the Administrative Agent may agree in its sole discretion,
duly execute and deliver, and cause each such Subsidiary that is not a Foreign Subsidiary
(or a Subsidiary of a Foreign Subsidiary) to duly execute and deliver, to the Administrative
Agent Mortgages encumbering Material Real Estate, Security Agreement Supplements, IP
Security Agreement Supplements and other security agreements, as specified by and in form
and substance reasonably satisfactory to the Administrative Agent (consistent with the U.S.
Security Agreement, IP Security Agreement and Mortgages), securing payment of all the
Obligations and constituting Liens on all such properties of the type that would be covered
by the U.S. Collateral Documents,




     (iv) within thirty (30) days after such request, formation, acquisition or change of
status, or such longer period, not to exceed an additional sixty (60) days, as the
Administrative Agent may agree in its sole discretion, take, and cause such Subsidiary that
is not a Foreign Subsidiary (or a Subsidiary of a Foreign Subsidiary) to take, whatever
action (including, without limitation, the recording of Mortgages on Material Real Estate,
the filing of UCC or PPSA financing statements, the giving of notices and the endorsement of
notices on title documents and



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delivery of stock and membership interest certificates and the delivery of
fully-executed Deposit Account Control Agreements, Securities Account Control Agreements and
Commodity Account Control Agreements) as may be necessary or advisable in the reasonable
opinion of the Administrative Agent to vest in the Administrative Agent (or in any
representative of the Administrative Agent designated by it) valid, subsisting and perfected
Liens on the properties purported to be subject to the Mortgages on Material Real Estate,
Security Agreement Supplements, IP Security Agreement Supplements and security agreements
delivered pursuant to this Section 6.12,




     (v) within thirty (30) days after the request of the Administrative Agent, or such
longer period as the Administrative Agent may agree in its sole discretion, deliver to the
Administrative Agent, signed copies of opinions, addressed to the Administrative Agent and
the other Secured Parties, of counsel for the Loan Parties reasonably acceptable to the
Administrative Agent as to such matters in relation to compliance with this Section
6.12(a) as the Administrative Agent may reasonably request,




     (vi) as promptly as practicable after the request of the Administrative Agent, to the
applicable Administrative Agent with respect to each parcel of real property on which
Mortgages on Material Real Estate that is the subject of such request, title insurance in
scope, form and substance reasonably satisfactory to the applicable Administrative Agent
and, to the extent available, land surveys and environmental assessment reports, and




     (vii) at any time upon the reasonable request of the Administrative Agent, promptly, or
such longer period as the Administrative Agent may agree in its sole discretion, execute and
deliver any and all further instruments and documents and take all such other action as the
Administrative Agent in its reasonable judgment may deem necessary or desirable in obtaining
the full benefits of, or in perfecting and preserving the Liens of, such guaranties,
Mortgages, Security Agreement Supplements, IP Security Agreement Supplements and security
agreements.



          (b) Upon the formation or acquisition of any new direct or indirect Subsidiaries that are
Canadian Subsidiaries (other than Excluded Subsidiaries) by any Canadian Loan Party, the Canadian
Borrower shall promptly notify the Administrative Agent thereof and the Canadian Borrower shall,
subject to applicable Laws, in each case, at the Canadian Borrower’s expense:




     (i) in connection with the formation or acquisition of a Subsidiary that is not an
Excluded Subsidiary, within thirty (30) days after such formation, acquisition or change of
status or such longer period as the Administrative Agent may agree in its sole discretion,
cause each such Subsidiary (if it has not already done so) to duly execute and deliver to
the Administrative Agent a guaranty or guaranty supplement, in form and substance reasonably
satisfactory to the Administrative Agent, guaranteeing the other Canadian Loan Parties’
obligations under the Loan Documents,




     (ii) within ten (10) days after such request, formation, acquisition or change of
status, or such longer period as the Administrative Agent may agree in its sole discretion,
furnish to each Administrative Agent a Perfection Certificate Supplement,




     (iii) within thirty (30) days after such request, formation or acquisition or change of
status, or such longer period as the Administrative Agent may agree in its sole discretion,
duly execute and deliver (if it has not already done so), and cause each such Subsidiary
that is a Canadian Subsidiary to duly execute and deliver, to the Administrative Agent new
Canadian Security Agreements and/or supplements thereto and other security agreements, as
specified by



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and in form and substance reasonably satisfactory to the Administrative Agent
(consistent with the Canadian Security Agreement), securing payment of all the Canadian
Obligations under the Loan Documents and constituting Liens on all such properties of the
type that would be covered by the Canadian Collateral Documents,




     (iv) within thirty (30) days after such request, formation, acquisition or change of
status, or such longer period, not to exceed an additional sixty (60) days, as the
Administrative Agent may agree in its sole discretion, take, and cause such Canadian
Subsidiary or its parent to take (if it has not already done so), whatever action
(including, without limitation, the filing of PPSA or UCC financing statements and other
similar filings in all applicable jurisdictions) as may be necessary or advisable in the
reasonable opinion of the Administrative Agent to vest in the Administrative Agent (or in
any representative of the Administrative Agent designated by it) valid, subsisting and
perfected Liens on the assets of the type constituting ABL Priority Collateral purported to
be subject to the Canadian Security Agreement and other security agreements delivered
pursuant to this Section 6.12(b), and




     (v) within thirty (30) days after the request of the Administrative Agent, or such
longer period as the Administrative Agent may agree in its sole discretion, deliver to the
Administrative Agent a signed copy of an opinion, addressed to the Administrative Agent and
the other Canadian Secured Parties, of counsel for the Loan Parties reasonably acceptable to
the Administrative Agent as to such matters in relation to compliance with this Section
6.12(b) as the Administrative Agent may reasonably request;



          (c) At any time upon the reasonable request of the Administrative Agent, promptly or such
longer period as the Administrative Agent may agree in its sole discretion, execute and deliver any
and all further instruments and documents and take all such other action as the Administrative
Agent in its reasonable judgment may deem necessary or desirable in obtaining the full benefits of,
or (as applicable) in perfecting and preserving the Liens of, such guaranties, deeds of trust,
trust deeds, deeds to secure debt, mortgages, hypothecs, leasehold mortgages, leasehold deeds of
trust, Security Agreement Supplements, IP Security Agreement Supplements and other security and
pledge agreements.



          (d) Notwithstanding the foregoing, (x) the Administrative Agent shall not perfect its Lien in
any assets as to which the Administrative Agent shall determine, in its reasonable discretion, that
the cost of perfecting such Lien (including any mortgage, stamp, intangibles or other tax) are
excessive in relation to the benefit to the Secured Parties of the security afforded thereby, (y)
the Loan Parties shall not be required to take any action to pledge any Equity Interests of a
Foreign Subsidiary under the laws of a jurisdiction other than the United States or any state
thereof, the District of Columbia or Canada or any province or territory thereof, unless such
Foreign Subsidiary (i) is pledged to secure the Senior Secured Notes or (ii) has either (A) gross
revenues (on a consolidated basis with its Subsidiaries) for the most recently ended period of four
consecutive fiscal quarters equal to or greater than 2.5% of the consolidated gross revenues of the
Specified U.S. Borrower and its Subsidiaries for such period or (B) total assets (on a consolidated
basis with its Subsidiaries) at the end of the most recently completed fiscal quarter equal to or
greater than 2.5% of consolidated total assets of the Specified U.S. Borrower and its Subsidiaries
as at such date (any such Subsidiary described in the forgoing clauses (i) and (ii), a
“Material Foreign Subsidiary”) and (z) in no event shall any Loan Party be required to take
any action in order to pledge any Equity Interests of any Subsidiary organized under the laws of
the People’s Republic of China.



          6.13 Compliance with Environmental Laws.



          (a) Except, in each case, to the extent that the failure to do so could not reasonably be
expected to result in liabilities, costs and expenses in excess of $25,000,000, (i) comply, and
take all



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commercially reasonable steps to cause all lessees and other Persons operating or occupying
its properties to comply with all applicable Environmental Laws and Environmental Permits; (ii)
obtain and renew all Environmental Permits necessary for its operations and properties; and (iii)
conduct any investigation, study, sampling and testing, and undertake any cleanup, removal,
remedial or other action necessary to address Hazardous Materials at, on, under or emanating from
any of its properties, in accordance with the requirements of all applicable Environmental Laws.




          (b) If a Default caused by reason of a breach of Section 5.09 or Section
6.13(a) shall have occurred and be continuing for more than 20 days without the Borrowers and
their Subsidiaries commencing activities reasonably necessary to cure such Default or contest, in
good faith, the asserted basis for such Event of Default, at the written request of the
Administrative Agent, provide to the Lenders within 45 days after such request (or such longer
period as the Administrative Agent may agree in its sole discretion), at the expense of the Loan
Party, an environmental assessment report for any property owned or operated by any Borrower or any
of its Subsidiaries, including, where appropriate, any soil and/or groundwater sampling, reasonably
relating to any matters that are the subject of such Default, prepared by an environmental
consulting firm of the Borrowers’ reasonable selection and in a form reasonably acceptable to the
applicable Administrative Agent and indicating as relevant the presence or absence of Hazardous
Materials and the estimated cost to address any non-compliance with or conduct any response or
other corrective action with respect to such Hazardous Material required under any Environmental
Law.



          6.14 Further Assurances. Promptly upon request by the Administrative Agent, or any
Lender through the Administrative Agent, (i) correct any material defect or error that may be
discovered in the execution, acknowledgment, filing or recordation of any Loan Document or other
document or instrument relating to any Collateral, and (ii) do, execute, acknowledge, deliver,
record, re-record, file, re-file, register and re-register any and all such further acts, deeds,
certificates, assurances and other instruments as the Administrative Agent, or any Lender through
the Administrative Agent, may reasonably require from time to time in order to (A) carry out more
effectively the purposes of the Loan Documents, (B) perfect and maintain the validity,
effectiveness and priority of any of the Collateral Documents and any of the Liens intended to be
created thereunder or (C) assure, convey, grant, assign, transfer, preserve, protect and confirm
more effectively unto the Secured Parties the rights granted or now or hereafter intended to be
granted to the Secured Parties under any Loan Document, and cause each of its Subsidiaries to do
so.



          6.15 Compliance with Terms of Leaseholds. Make all payments and otherwise perform all
obligations in respect of all leases of real property of the Loan Parties material to the business
of the Loan Parties, keep such leases in full force and effect and not allow such leases to lapse
or be terminated or any rights to renew such leases to be forfeited or cancelled, notify the
Administrative Agent of any receipt of any notice of material default by any party with respect to
such leases and cooperate with the Administrative Agent in all respects to cure any such material
default, and cause each of its Subsidiaries to do so, except, in any case, (a) where the failure to
do so, either individually or in the aggregate, could not be reasonably likely to result in a
Material Adverse Effect or (b) for terminations, lapses and amendments in the ordinary course of
business.



          6.16 [Reserved].



          6.17 Designation as Senior Debt. Designate all Obligations as “Designated Senior
Indebtedness” under, and as defined in, all Junior Financing Documentation.



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          6.18 Collateral Administration.



          (a) Administration of Accounts.




          (i) Records and Schedules of Accounts. Each Loan Party shall keep accurate and
complete records of its Accounts, including all payments and collections thereon, and shall
submit to the Administrative Agent sales, collection, reconciliation and other reports in
form reasonably satisfactory to the Administrative Agent, on such periodic basis as the
Administrative Agent may request. The Borrower Agent shall also provide to the
Administrative Agent, on or before the 20th day of each month, a detailed aged trial balance
of all Loan Party Accounts as of the end of the preceding month, specifying each Account’s
Account Debtor name and address, amount, invoice date and due date, showing any discount,
allowance, credit, authorized return or dispute, and including such proof of delivery,
copies of invoices and invoice registers, copies of related documents, repayment histories,
status reports and other information as the Administrative Agent may reasonably request. If
Accounts in an aggregate face amount of $5,000,000 or more cease to be Eligible Receivables,
the Borrower Agent shall notify the Administrative Agent of such occurrence promptly (and in
any event within three Business Days) after any Loan Party has knowledge thereof.




          (ii) Taxes. If an Account of any Loan Party includes a charge for any Taxes,
the Administrative Agent is authorized, in its discretion, to pay the amount thereof to the
proper taxing authority for the account of such Loan Party if such Loan Party does not do so
and to charge the Borrowers therefor; provided, however, that neither the
Administrative Agent nor the Lenders shall be liable for any Taxes that may be due from the
Loan Parties or with respect to any Collateral.




          (iii) Account Verification. Whether or not a Default or Event of Default or a
Cash Dominion Event exists, the Administrative Agent shall have the right at any time, in
the name of the Administrative Agent, any designee of the Administrative Agent or any Loan
Party, to verify the validity, amount or any other matter relating to any Accounts of the
Loan Party by mail, telephone or otherwise. The Loan Parties shall cooperate fully with the
Administrative Agent in an effort to facilitate and promptly conclude any such verification
process.




          (iv) Maintenance of Accounts. The Loan Parties shall maintain one or more
Dominion Accounts, each pursuant to a lockbox or other arrangement acceptable to
Administrative Agent. The Loan Parties shall enter into Deposit Account Control Agreements
with each bank at which a Deposit Account (other than an Excluded Account) is maintained by
which such bank shall, upon the occurrence and during the continuation of a Cash Dominion
Event, immediately transfer to the U.S. Payment Account all monies deposited to a Dominion
Account constituting proceeds of U.S. Collateral and to the Canadian Payment Account all
monies deposited to a Dominion Account constituting proceeds of Canadian Collateral. All
funds deposited in each Dominion Account shall be subject to the Administrative Agent’s
Lien. The Loan Parties shall obtain the agreement (in favor of and in form and content
reasonably satisfactory to the Administrative Agent) by each bank at which a Dominion
Account is maintained to waive any offset rights against the funds deposited into such
Dominion Account, except offset rights in respect of charges incurred in the administration
of such Dominion Account. The Administrative Agent and the Lenders shall not assume any
responsibility to any Loan Party for such lockbox arrangement or, upon the occurrence and
during the continuation of a Cash Dominion Event, any Dominion Account, including any claim
of accord and satisfaction or release with respect to deposits accepted by any bank
thereunder.



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          (v) Collection of Accounts; Proceeds of Collateral. All Payment Items received
by any Loan Party in respect of its Accounts, together with the proceeds of any other
Collateral, shall be held by such Loan Party as trustee of an express trust for the
Administrative Agent’s benefit; such Loan Party shall immediately deposit same in kind in a
Dominion Account for application to the applicable Obligations in accordance with the terms
of this Agreement and the applicable Security Agreement. The Administrative Agent retains
the right at all times that an Event of Default exists to notify Account Debtors of any Loan
Party that Accounts have been assigned to the Administrative Agent and to collect Accounts
directly in its own name and to charge to the Borrowers the collection costs and expenses
incurred by the Administrative Agent or Lenders, including reasonable attorneys’ fees. Upon
the occurrence and during the continuation of a Cash Dominion Event, all monies properly
deposited in the U.S. Payment Account shall be deemed to be voluntary prepayments of U.S.
Obligations and applied in accordance with Section 2.05(b)(xi)(A) to reduce
outstanding Obligations and all monies properly deposited in the Canadian Payment Account
shall be deemed to be voluntary prepayments of Canadian Obligations and applied in
accordance with Section 2.05(b)(xi)(B) to reduce outstanding Canadian Obligations.




          (vi) Asset Sales Proceeds Accounts. Neither the Specified U.S. Borrower nor
any of its Subsidiaries shall deposit any funds or credit any amounts into any “Asset Sales
Proceeds Account” (as defined in the Intercreditor Agreement), other than proceeds of
“Noteholder Collateral” (as defined in the Intercreditor Agreement).



          (b) Administration of Inventory.




          (i) Records and Reports of Inventory. Each Loan Party shall keep accurate and
complete records of its Inventory, including costs and daily withdrawals and additions, and
shall submit to the Collateral Agents inventory and reconciliation reports in form
reasonably satisfactory to the Collateral Agents, on such periodic basis as any of the
Collateral Agents may request. Each Loan Party shall conduct a physical inventory at least
once per calendar year (and on a more frequent basis if requested by any of the Collateral
Agents when an Event of Default exists) or periodic cycle counts consistent with historical
practices, and shall provide to the Collateral Agents a report based on each such inventory
and count promptly upon completion thereof, together with such supporting information as any
Collateral Agent may reasonably request. The Collateral Agents may participate in and
observe each physical count.




          (ii) Returns of Inventory. No Loan Party shall return any Inventory to a
supplier, vendor or other Person, whether for cash, credit or otherwise, unless (a) such
return is in the ordinary course of business; (b) no Default, Event of Default or
Overadvance exists or would result therefrom; and (c) the Collateral Agents are promptly
notified if the aggregate value of all Inventory returned in any month exceeds $5,000,000.




          (iii) Acquisition, Sale and Maintenance. The Loan Parties shall use, store and
maintain all Inventory with reasonable care and caution, in accordance with applicable
standards of any insurance and in conformity with all applicable Law, and shall make current
rent payments (within applicable grace periods provided for in leases) at all locations
where any Collateral is located.



          6.19 Maintenance of Cash Management System.



          (a) The applicable schedule to the Perfection Certificate sets forth all Deposit Accounts
maintained by the Loan Parties, including all Dominion Accounts. Each Loan Party shall be the



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sole account holder of each Deposit Account (other than an Excluded Account) and shall not
allow any other Person (other than the Administrative Agent) to have control over or a Lien on
(except for any nonconsensual Liens permitted under Section 7.01(m) or (u)) a
Deposit Account (other than an Excluded Account) or any property deposited therein.




          (b) Within ninety (90) days after the Closing Date (or such later date as may be agreed to by
the Administrative Agent), the Loan Parties shall deliver to the Administrative Agent Deposit
Account Control Agreements, Securities Account Control Agreements and Commodity Account Control
Agreements for all of the Deposit Accounts, Securities Accounts and Commodity Accounts,
respectively, of the Loan Parties (other than Excluded Accounts), duly executed by each applicable
Loan Party and the applicable depositary bank or securities intermediary, or shall have otherwise
taken all actions necessary to establish the Administrative Agent’s control of and Lien on each
such account in a manner reasonably acceptable to the Administrative Agent.



          (c) Upon the occurrence and during the continuation of a Cash Dominion Event, the Loan Parties
shall cause any and all funds and financial assets held in or credited to each deposit account and
each securities account to be swept into the U.S. Payment Account or Canadian Payment Account, as
applicable, on a daily basis (or at other frequencies as agreed by the Administrative Agent).



ARTICLE VII

NEGATIVE COVENANTS




          So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation
hereunder (other than any contingent indemnification obligation as to which no claim has been
asserted) shall remain unpaid or unsatisfied, or any Letter of Credit (other than Letters of Credit
as to which arrangements reasonably satisfactory to the Administrative Agent and the applicable L/C
Issuer shall have been made) shall remain outstanding, each Borrower shall not, nor shall they
permit any of their Subsidiaries to, directly or indirectly:



          7.01 Liens. Create, incur, assume or suffer to exist any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, or sign or file or authorize
the filing under the UCC, the PPSA, the Civil Code of Quebec or similar law of any jurisdiction a
financing statement or similar filing or registration that names the Borrowers or any of their
respective Subsidiaries as debtor, or sign any security agreement authorizing any secured party
thereunder to file such financing statement or similar filing or registration, other than the
following:




     (a) Liens pursuant to any Loan Document;




     (b) Liens securing the Senior Secured Notes and any Permitted Refinancing thereof,
subject to the terms of the Intercreditor Agreement;




     (c) Liens existing on the Closing Date and listed on Schedule 7.01 and any
modifications, replacements, renewals or extensions thereof; provided that (i) the
Lien does not extend to any additional property other than (A) after-acquired property that
is affixed or incorporated into the property covered by such Lien and (B) proceeds and
products thereof; provided that in the case of this clause (i), individual PPE
Financing provided by one lender or its Affiliates may be cross-collateralized to other PPE
Financing provided by such lender or its Affiliates on customary terms and (ii) the renewal,
extension or refinancing of the obligations secured or benefited by such Liens is not
prohibited by Section 7.03;



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     (d) Liens for Taxes, assessments or governmental charges which are not required to be
paid pursuant to Section 6.04;




     (e) statutory Liens of landlords, carriers, warehousemen, mechanics, materialmen,
repairmen, processors or other like Liens arising in the ordinary course of business which
secure amounts not overdue for a period of more than thirty (30) days or if more than thirty
(30) days overdue, are unfiled and no other action has been taken to enforce such Lien or
which are being contested in good faith and by appropriate proceedings diligently conducted
which proceedings have the effect of preventing the forfeiture or sale of the property
subject to such Lien, if adequate reserves with respect thereto are maintained on the books
of the applicable Person;




     (f) (i) pledges or deposits in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other social security legislation
(including obligations in respect of letters of credit or bank guarantees issued in lieu of
such pledges or deposits), other than any Lien imposed by ERISA or in respect of a required
contribution to Canadian Pension Plans, (ii) pledges and deposits in the ordinary course of
business securing liability for reimbursement or indemnification obligations (including
obligations in respect of letters of credit or bank guarantees supporting such reimbursement
or indemnification obligations) owing to insurance carriers providing property, casualty or
liability insurance to the Specified U.S. Borrower or any of its Subsidiaries and (iii)
Liens on (A) the unearned portion of any insurance premiums securing the financing of
insurance premiums in the ordinary course of business and (B) insurance policies and the
proceeds thereof securing the financing of insurance premiums with respect thereto in the
ordinary course of business; provided, that, to the extent that such proceeds constitute
proceeds of or payments in respect of ABL Priority Collateral, the consent of the Collateral
Agents shall have been obtained;




     (g) deposits to secure the performance of bids, trade contracts, governmental contracts
and leases (other than Indebtedness for borrowed money), statutory obligations, surety,
stay, customs and appeal bonds, performance bonds and other obligations of a like nature
(including obligations in respect of letters of credit or bank guarantees issued in lieu of
such pledges or deposits) incurred in the ordinary course of business and not in connection
with Indebtedness for money borrowed;




     (h) zoning restrictions, easements, rights-of-way, restrictions, encroachments,
protrusions and other similar encumbrances and minor title defects affecting real property
which, in the aggregate, do not in any case materially interfere with the ordinary conduct
of the business of the applicable Person;




     (i) Liens securing judgments not constituting an Event of Default under Section
8.01(h);




     (j) Liens securing Indebtedness permitted under Section 7.03(b)(vi);
provided that (i) such Liens attach concurrently with or within one hundred eighty
(180) days after the purchase, repair, replacement or improvement (as applicable) of the
property subject to such Liens, (ii) such Liens do not at any time encumber any property
other than the property financed by such Indebtedness and the proceeds and the products
thereof and (iii) with respect to Capitalized Leases, such Liens do not at any time extend
to or cover any assets other than the assets subject to such Capitalized Leases;
provided that in the case of clauses (ii) and (iii) individual PPE Financing
provided by one lender or its Affiliates may be cross-collateralized to other PPE Financing
provided by such lender or its Affiliates on customary terms;



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     (k) leases, licenses, subleases or sublicenses in respect of property (other than
property constituting ABL Priority Collateral) granted to others in the ordinary course of
business and not interfering in any material respect with the business of the Specified U.S.
Borrower or any of its Subsidiaries;




     (l) Liens in favor of customs and revenue authorities arising as a matter of law to
secure payment of customs duties in connection with the importation of goods in the ordinary
course of business;




     (m) Liens (i) that are customary rights of set-off (A) relating to the establishment of
depository relations with banks not given in connection with the issuance of Indebtedness or
(B) relating to pooled deposit or sweep accounts of the Specified U.S. Borrower or any
Subsidiary to permit satisfaction of overdraft or similar obligations incurred in the
ordinary course of business of the Specified U.S. Borrower or any Subsidiary or (ii) that
are rights of set-off relating to purchase orders and other agreements entered into with
customers of the Specified U.S. Borrower or any Subsidiary in the ordinary course of
business;




     (n) Liens (i) on cash advances in favor of the seller of any property to be acquired in
an Investment permitted pursuant to Sections 7.02(h), (n) and (o) to
be applied against the purchase price for such Investment, and (ii) consisting of an
agreement to Dispose of any property in a Disposition permitted under Section 7.05,
in each case, solely to the extent such Investment or Disposition, as the case may be, would
have been permitted on the date of the creation of such Lien;




     (o) Liens on property of any Foreign Subsidiary (other than a Canadian Subsidiary)
securing Indebtedness of such Foreign Subsidiary to the extent permitted under Section
7.03(b)(vii) (which may include the Equity Interests of such Foreign Subsidiary to the
extent not pledged under the Loan Documents);




     (p) Liens not extending to any ABL Priority Collateral in favor of the Specified U.S.
Borrower or a Subsidiary of the Specified U.S. Borrower securing Indebtedness permitted
under Section 7.03(b)(v); provided that if such Liens are on any property of
a U.S. Loan Party, such Liens are in favor of a U.S. Loan Party and if such Liens are on any
property of a Canadian Loan Party, such Liens are in favor of a Loan Party;




     (q) Liens existing on property at the time of its acquisition or existing on the
property of any Person that becomes a Subsidiary after the date hereof; provided
that (i) such Lien was not created in contemplation of such acquisition or such Person
becoming a Subsidiary, (ii) such Lien does not extend to or cover any other assets or
property (other than the proceeds or products thereof); provided that, in the case
of this clause (ii), individual PPE Financing provided by one lender or its Affiliates may
be cross-collateralized to other PPE Financing provided by such lender or its Affiliates on
customary terms and (iii) the Indebtedness secured thereby is permitted under Section
7.03(b)(vi) or Section 7.03(b)(xvii) (and is permitted to be secured);




     (r) Liens not extending to any ABL Priority Collateral arising from precautionary UCC
or PPSA financing statement (or the foreign equivalent thereof) filings regarding operating
leases entered into by the Specified U.S. Borrower or any of its Subsidiaries as lessees in
the ordinary course of business;



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     (s) any interest or title of a lessor, sublessor, licensee, sublicensee, licensor or
sublicensor under any lease or license agreement in the ordinary course of business
permitted by this Agreement;




     (t) Liens not extending to any ABL Priority Collateral arising out of conditional sale,
title retention, consignment or similar arrangements for sale of goods entered into by the
Specified U.S. Borrower or any of its Subsidiaries in the ordinary course of business
permitted by this Agreement;




     (u) Liens not extending to any ABL Priority Collateral encumbering reasonable customary
initial deposits and margin deposits and similar Liens attaching to commodity trading
accounts or other brokerage accounts incurred in the ordinary course of business and not for
speculative purposes;




     (v) Permitted Encumbrances;




     (w) other Liens securing Indebtedness and other obligations outstanding in an aggregate
principal amount not to exceed $37,500,000 (none of which shall be secured by Liens on the
ABL Priority Collateral);




     (x) Liens deemed to exist in connection with Investments in repurchase agreements
permitted under Section 7.02;




     (y) the Lien against the real property located at 1620 Mid-American Industrial Court,
Boonville, Missouri; and




     (z) Liens on property rented to, or leased by, any Subsidiary pursuant to a
sale-leaseback transaction permitted under Section 7.05(f).



          7.02 Investments. Make or hold any Investments, except:




     (a) Investments held by the Specified U.S. Borrower or such Subsidiary in Cash
Equivalents;




     (b) loans or advances to officers, directors or employees of the Specified U.S.
Borrower and its Subsidiaries in an aggregate amount not to exceed $5,000,000 at any time
outstanding;




     (c) Investments (i) by the Specified U.S. Borrower or any of its Subsidiaries in any
U.S. Loan Party (including any new Subsidiary which becomes a U.S. Loan Party), (ii) by any
Canadian Loan Party (x) in any other Canadian Loan Party and (y) in any Foreign Subsidiary
that is a Subsidiary but not a Loan Party in an amount not to exceed $5,000,000 at any time
outstanding (or, if Excess Availability at the time any such Investment is made and after
giving effect thereto would be 15% or more of the Total Borrowing Base, additional amounts
but not to exceed $25,000,000 in the aggregate at anytime outstanding), (iii) by any
Subsidiary that is not a Loan Party in any other Subsidiary, (iv) by the Specified U.S.
Borrower or any Subsidiary that is a Loan Party in any Subsidiary that is not a U.S. Loan
Party in an aggregate amount not to exceed $5,000,000 at any time outstanding or, if Excess
Availability at the time any such Investment is made and after giving effect thereto would
be 15% or more of the Total Borrowing Base, additional amounts not to exceed $25,000,000 in
the aggregate at any time outstanding) and (v) by the Specified U.S. Borrower or any
Subsidiary in any Foreign Subsidiary consisting of



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(A) the
contribution of Equity Interests of any other Foreign Subsidiary held directly by the
Specified U.S. Borrower or such Subsidiary in exchange for Indebtedness, Equity Interests or
a combination thereof of the Foreign Subsidiary to which such contribution is made,
provided that if such Equity Interests are of a Canadian Loan Party, such
contribution is to a Canadian Loan Party; or (B) the exchange of Equity Interests in any
Foreign Subsidiary for Indebtedness of such Foreign Subsidiary;




     (d) Investments consisting of extensions of credit in the nature of accounts receivable
or notes receivable arising from the grant of trade credit in the ordinary course of
business, and Investments received in satisfaction or partial satisfaction thereof from
financially troubled account debtors;




     (e) to the extent constituting Investments, transactions expressly permitted under
Sections 7.01, 7.03(b)(iii), (iv) or (v) (other than
subclause (C)(2) thereof), 7.04, 7.05 (other than clauses
(b), (d), (g), (h), (l) and (o) thereof) and
7.06;




     (f) Investments existing on the Closing Date and set forth on Schedule 7.02 and
any modification, replacement, renewal or extension thereof; provided that the
amount of the original Investment is not increased except as otherwise permitted by this
Section 7.02;




     (g) Investments in Swap Contracts permitted under Section 7.03;




     (h) at any time not less than 60 days after the Closing Date, the purchase or other
acquisition of all or substantially all of the property and assets or business of, any
Person or of assets constituting a business unit, a line of business or division of such
Person, or at least 80% of the Equity Interests in a Person that, upon the consummation
thereof, will be owned directly by the Specified U.S. Borrower or one or more of its wholly
owned Subsidiaries (including, without limitation, as a result of a merger or
consolidation); provided that, with respect to each purchase or other acquisition
made pursuant to this Section 7.02(h) (each, a “Permitted Acquisition”):




     (i) each applicable Loan Party and any such newly created or acquired
Subsidiary shall comply with the applicable requirements of Section 6.12;




     (ii) the board of directors of such acquired Person or its selling equity
holders in existence at the time such purchase or acquisition is commenced shall
have approved such purchase or other acquisition;




     (iii) immediately before and immediately after giving effect to any such
purchase or other acquisition, (A) no Default shall have occurred and be continuing
and the pro forma Consolidated Fixed Charge Coverage Ratio shall be at least 1.2:1.0
and (B) on a pro forma basis, the Average Excess Availability for the 60 day periods
both prior to and following the transaction shall be at least 20% of the Total
Borrowing Base (it being agreed that unless the Collateral Agents shall otherwise
agree in their sole discretion, (1) Inventory and Accounts to be acquired in a
Permitted Acquisition shall be included in the pro forma calculation of the Total
Borrowing Base for purposes of complying with this clause (iii)(B), so long as such
inclusion is based upon the Borrowers’ good faith estimate in accordance with
existing eligibility criteria for calculating the Total Borrowing Base and (2) no
Inventory or Accounts acquired in a Permitted Acquisition shall be included in the
Borrowing Base until the Collateral Agents shall have completed a field audit and
inventory appraisal in scope and with results satisfactory to the Collateral Agents
and until the Administrative Agent shall have



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received duly executed Deposit Account
Control Agreements, Securities Account Control Agreements and Commodity Account
Control Agreements with respect to the bank accounts, securities accounts and
commodities accounts of the acquired business (other than Excluded Accounts));




     (iv) the total cash and noncash consideration (including all earnouts and other
contingent payment obligations which are reasonably estimated to be paid at the time
that the agreement governing such purchase or acquisition is entered into, the
aggregate amounts paid or to be paid under noncompete, consulting and other
affiliated agreements with the sellers of such Person or assets (other than
non-compete, consulting and other affiliated agreements in respect of future
services to be provided by such sellers), and all assumptions of Indebtedness in
connection therewith, but excluding indemnification obligations and the fair market
value of any Equity Interests of the Specified U.S. Borrower (or any direct or
indirect parent entity of the Specified U.S. Borrower) issued or transferred to the
sellers of such Person or assets in connection with such purchase or acquisition)
paid or payable by or on behalf of the Specified U.S. Borrower and its Subsidiaries
for any such purchase or other acquisition, when aggregated with such total cash and
noncash consideration paid or payable by or on behalf of the Specified U.S. Borrower
and its Subsidiaries for all other purchases and other acquisitions made by the
Borrower and its Subsidiaries pursuant to this clause (h), shall not exceed
$125,000,000 plus the amount of any Specified Issuance Proceeds that finance any
Permitted Acquisitions in accordance with the terms hereof;




     (v) the Specified U.S. Borrower shall have delivered to the Administrative
Agent, on behalf of the Lenders, at least one (1) Business Day prior to the date on
which any such purchase or other acquisition is to be consummated, a certificate of
a Responsible Officer, in form and substance reasonably satisfactory to the
Administrative Agent, certifying that all of the requirements set forth in this
clause (h) have been satisfied or will be satisfied on or prior to the
consummation of such purchase or other acquisition; and




     (vi) except to the extent the purchase price therefor is paid by a Foreign
Subsidiary, the fair market value of all property acquired in Permitted Acquisitions
which is contributed to or owned by Subsidiaries that are not U.S. Loan Parties, or
do not become U.S. Loan Parties immediately after giving effect to such acquisition,
shall be deemed to be a permitted Investment only to the extent made pursuant to
Section 7.02(c)(iv);




     (i) Investments that the Specified U.S. Borrower has elected to be treated as
Restricted Payments pursuant to and to the extent permitted by Section 7.06;




     (j) Investments in the ordinary course of business consisting of (i) endorsements for
collection or deposit and (ii) customary trade arrangements with customers consistent with
past practices;




     (k) Investments (including debt obligations and Equity Interests) received in
connection with the bankruptcy or reorganization of suppliers and customers and in
settlement of delinquent obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business and upon the foreclosure with respect to any
secured Investment or other transfer of title with respect to any secured Investment;



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     (l) the licensing, sublicensing or contribution of IP Rights pursuant to joint
marketing arrangements in the ordinary course of business;




     (m) loans and advances to any direct or indirect parent entity of the Specified U.S.
Borrower in lieu of, and not in excess of the amount of (after giving effect to any other
loans, advances or Restricted Payments in respect thereof), Restricted Payments to the
extent permitted to be made to any direct or indirect parent entity of the Specified U.S.
Borrower in accordance with Section 7.06;




     (n) other Investments so long as immediately before and immediately after giving effect
to any such Investment, (i) no Event of Default has occurred and is continuing, (ii) Excess
Availability shall exceed 20% of the Total Borrowing Base and (iii) the Specified U.S.
Borrower shall be in compliance with the covenant set forth in Section 7.11 (whether
or not such covenant is otherwise applicable under this Agreement at such time) and shall
have delivered to the Administrative Agent a pro forma Compliance Certificate demonstrating
such compliance; and




     (o) other Investments in an aggregate amount not to exceed $10,000,000 during the term
of this Agreement.



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



          (a) in the case of the Specified U.S. Borrower:




     (i) the Senior Secured Notes and any Permitted Refinancings thereof;




     (ii) Permitted Subordinated Indebtedness;



          (b) in the case of Specified U.S. Borrower and its Subsidiaries:




     (i) Indebtedness of the Loan Parties under the Loan Documents;




     (ii) Indebtedness of the Loan Parties under the Senior Secured Notes and any
Permitted Refinancings thereof;




     (iii) Indebtedness outstanding on the Closing Date and listed on Schedule
7.03(b) and any modifications, amendments, restatements, amendments and
restatements, refinancings, refundings, renewals or extensions thereof;
provided that (A) the amount of such Indebtedness is not increased at the
time of such modification, amendment, restatement, amendment and restatement,
refinancing, refunding, renewal or extension except (x) by an amount equal to a
reasonable premium or other reasonable amount paid, and fees and expenses reasonably
incurred, in connection with such refinancing or (y) as otherwise permitted pursuant
to this Section 7.03, and (B) the terms and conditions (including, if
applicable, as to collateral and subordination) of any such modified, amended,
restated, amended and restated, extending, refunding or refinancing Indebtedness are
not materially less favorable to the Loan Parties or the Lenders than the terms and
conditions of the Indebtedness being modified, amended, restated, amended and
restated, extended, refunded or refinanced;




     (iv) Guarantees of the Specified U.S. Borrower and its Subsidiaries in respect
of Indebtedness of the Specified U.S. Borrower or such Subsidiary otherwise
permitted under this Section 7.03(b); provided that (i) if such
Guarantee is a Guarantee of



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Indebtedness of a U.S. Loan Party by any Subsidiary, such Subsidiary is a U.S.
Loan Party or such Subsidiary shall have also provided a Guarantee of the
Obligations substantially on the terms set forth in the U.S. Guaranty, (ii) if such
Guarantee is a Guarantee of Indebtedness of a Canadian Loan Party by any Subsidiary,
such Subsidiary is a Loan Party or such Subsidiary shall have also provided a
Guarantee of the Canadian Obligations substantially on the terms set forth in the
Canadian Guarantee, (iii) if such Guarantee is of Indebtedness of a Subsidiary that
is not a U.S. Loan Party, such Guarantee would be permitted as an Investment under
Section 7.02 and (iv) if such Indebtedness is subordinated to the
Obligations, such Guarantee shall be also be subordinated to the Obligations on
terms no less favorable to the Lenders;




     (v) Indebtedness of (A) any U.S. Loan Party owing to any other Loan Party, (B)
any Canadian Loan Party owing to any other Loan Party, (C) any Subsidiary that is
not a Loan Party owing to (1) any other Subsidiary that is not a Loan Party or (2)
any direct or indirect parent entity of the Specified U.S. Borrower or a Loan Party
in respect of an Investment permitted under Section 7.02(c), (n) or
(o), and (D) any Loan Party owing to any Subsidiary which is not a Loan
Party or to any direct or indirect parent entity of such Loan Party;
provided that (i) all such Indebtedness of any Loan Party in this clause
(v)(D) (other than Indebtedness of such Loan Party owing to any direct or
indirect parent of the Specified U.S. Borrower) must be expressly subordinated to
the Obligations and/or the Canadian Obligations on the terms set forth in the
Guaranties, as applicable, and be represented by the Intercompany Note and (ii) all
such Indebtedness of any Loan Party in this clause (v)(D) owing to any
direct or indirect parent of the Specified U.S. Borrower must be expressly
subordinated to the Obligations and/or the Canadian Obligations on terms reasonably
satisfactory to the Administrative Agent;




     (vi) Attributable Indebtedness and purchase money obligations (including
obligations in respect of mortgage, industrial revenue bond, industrial development
bond and similar financings) to finance the purchase, repair, replacement or
improvement of fixed or capital assets within the limitations set forth in
Section 7.01(j) and any Permitted Refinancing thereof; provided,
however, that the aggregate amount of all such Indebtedness at any one time
outstanding shall not exceed $30,000,000;




     (vii) Indebtedness of Foreign Subsidiaries (other than Canadian Subsidiaries)
in an aggregate principal amount at any time outstanding for all such Persons taken
together not exceeding $30,000,000;




     (viii) Indebtedness in respect of Swap Contracts designed to hedge against
foreign exchange rates or commodities pricing risks incurred in the ordinary course
of business and not for speculative purposes;




     (ix) unsecured Indebtedness consisting of promissory notes issued by any Loan
Party to current or former officers, directors and employees, their respective
estates, heirs, family members, spouses or former spouses to finance the purchase or
redemption of Equity Interests of the Specified U.S. Borrower (or any direct or
indirect parent company or any Subsidiary thereof) as permitted by Section
7.06;




     (x) unsecured Indebtedness incurred by the Specified U.S. Borrower or its
Subsidiaries in a Permitted Acquisition or Disposition under agreements providing
for customary adjustments of the purchase price;



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     (xi) cash management obligations and other Indebtedness in respect of
endorsements for collection or deposit, netting services, overdraft protections and
similar arrangements in each case in connection with deposit accounts
provided that such Indebtedness is extinguished within ten Business Days
after its incurrence;




     (xii) unsecured Indebtedness in an aggregate principal amount not to exceed
$75,000,000 at any time outstanding;




     (xiii) [Reserved]




     (xiv) Indebtedness consisting of (A) the financing of insurance premiums, (B)
take-or-pay obligations contained in supply arrangements and (C) customary
indemnification obligations, in each case, incurred in the ordinary course of
business and not in connection with debt for money borrowed;




     (xv) Indebtedness incurred by the Specified U.S. Borrower or any of its
Subsidiaries constituting reimbursement obligations with respect to letters of
credit or bank guarantees issued in the ordinary course of business in respect of
workers compensation, unemployment insurance and other social security legislation,
or health, disability or other employee benefits or property, casualty or liability
insurance or self-insurance or other Indebtedness with respect to reimbursement-type
obligations regarding workers compensation claims in the ordinary course of
business; provided that upon the drawing of such letters of credit or the
incurrence of such Indebtedness, such obligations are reimbursed within 30 days
following such drawing or incurrence;




     (xvi) obligations in respect of performance, surety, appeal or similar bonds
and performance and completion guarantees provided by the Specified U.S. Borrower or
any of its Subsidiaries (including those in favor of customs and revenue
Governmental Authorities arising as a matter of Law to secure payment of customs
duties in connection with the importation of goods) or obligations in respect of
letters of credit or bank guarantees related thereto, in each case in the ordinary
course of business consistent with past practice and not in connection with debt for
money borrowed; and




     (xvii) (A) Indebtedness of the Specified U.S. Borrower or a Subsidiary assumed
in connection with any Permitted Acquisition (and not created in contemplation
thereof) not to exceed $100,000,000 in the aggregate outstanding at any time (of
which (x) no more than $30,000,000 (taken in the aggregate with Indebtedness under
clause (B) below that matures within such period) may have a maturity date or any
mandatory principal payments prior to the date that is 181 days after the Maturity
Date and (y) no more than $20,000,000 may be secured (and Indebtedness pursuant to
this clause (y) shall not be secured by any ABL Priority Collateral or any other
property besides a single asset or group of related assets specifically identified
in the documentation for such Indebtedness) (“Permitted Acquired Debt”) and
(B) Indebtedness of the Specified U.S. Borrower owed to the seller of any property
acquired in a Permitted Acquisition on an unsecured subordinated basis (on terms (1)
no less favorable to the Lenders than the terms customary for senior subordinated
debt securities of comparable issuers issued in the capital markets at such time and
placed by nationally recognized investment banks, in each case as reasonably
determined by the Collateral Agents or (2) reasonably acceptable to the Collateral
Agents) and of which no more than $30,000,000 (taken in the aggregate with
Indebtedness under clause (A) above that



130









 







matures within such period) shall have any
maturity or mandatory principal payments prior to the date that is 181 days
after the Maturity Date (“Permitted Seller Notes”).



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




     (a) any Subsidiary may merge with (i) the Specified U.S. Borrower (including a merger,
the purpose of which is to reorganize the Specified U.S. Borrower into a new jurisdiction
which is a State of the United States of America), provided that the Specified U.S.
Borrower shall be the continuing or surviving Person or the surviving Person shall expressly
assume the obligations of the Specified U.S. Borrower pursuant to documents reasonably
acceptable to the Administrative Agent, or (ii) any one or more other Subsidiaries,
provided that when any U.S. Subsidiary Guarantor is merging with another Subsidiary,
the U.S. Subsidiary Guarantor shall be the continuing or surviving Person;




     (b) any Canadian Subsidiary may merge or amalgamate with (i) the Canadian Borrower
(including a merger or amalgamation, the purpose of which is to reorganize the Canadian
Borrower into a new jurisdiction which is a province or territory of Canada),
provided that the Canadian Borrower shall be the continuing or surviving Person or
the surviving Person shall expressly assume the obligations of the Canadian Borrower
pursuant to documents reasonably acceptable to the Administrative Agent, or (ii) any one or
more other Subsidiaries, provided that when any Canadian Subsidiary Guarantor is
merging or amalgamating with another Subsidiary, a Guarantor shall be the continuing or
surviving Person;




     (c) (i) any Subsidiary may Dispose of all or substantially all of its assets (upon
voluntary dissolution, liquidation or otherwise) to the Specified U.S. Borrower or to
another Subsidiary; provided that if the transferor in such a transaction is a
Guarantor, then the transferee must be a Loan Party or become a Loan Party in connection
with such transaction and if the transferee is not the Specified U.S. Borrower or a U.S.
Subsidiary Guarantor, such transfer must be in the ordinary course of business consistent
with past practice, and (ii) any Subsidiary that is not a U.S. Subsidiary Guarantor may
Dispose of all or substantially all of its assets (upon voluntary liquidation or otherwise)
to the Canadian Borrower or another Subsidiary; provided that if the transferor in
such transaction is a Canadian Loan Party, then the transferee must be a Loan Party;




     (d) any Subsidiary may merge or amalgamate with or Dispose of all or substantially all
of its assets to any other Person in order to effect an Investment permitted pursuant to
Section 7.02; provided that if the Person surviving such transaction shall
be a Subsidiary, such Person and each of its Subsidiaries shall have complied with the
applicable requirements of Section 6.12;




     (e) a merger, amalgamation, dissolution, liquidation, consolidation or Disposition, the
purpose of which is to effect a Disposition permitted pursuant to Section 7.05
(other than clause (e) thereof); and




     (f) any Subsidiary may liquidate, dissolve or wind up its affairs; provided
that (i) the Specified U.S. Borrower determines in good faith that such liquidation,
dissolution or winding up is in the best interest of the Specified U.S. Borrower and is not
materially disadvantageous to the Lenders and (ii) in connection with such liquidation,
dissolution or winding up, any assets of such



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Subsidiary are distributed to each owner of Equity Interests of such Subsidiary pro
rata in accordance with such owner’s relative ownership interests.



          7.05 Dispositions. (i) Make any Disposition or (ii) enter into any agreement to make
any Disposition (unless, in the case of this clause (ii), all Obligations (other than contingent
Obligations in respect of unasserted indemnity claims) would be repaid in cash and all Commitments
would terminate substantially simultaneously with the consummation of such Disposition or such
Disposition is conditioned upon obtaining the requisite Lender consent hereunder), except:




     (a) Dispositions of obsolete or worn out property, whether now owned or hereafter
acquired, in the ordinary course of business and Dispositions of property no longer used or
useful in the conduct of the business of the Specified U.S. Borrower and its Subsidiaries;




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




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




     (d) Dispositions of property by any Subsidiary to the Specified U.S. Borrower or to a
Subsidiary; provided that (A) if the transferor of such property is a U.S. Loan
Party either (i) the transferee is a U.S. Loan Party or (ii) to the extent such transaction
constitutes an Investment, such transaction is permitted under Section 7.02 and (B)
if the transferor of such property is a Canadian Loan Party either (i) the transferee is a
Loan Party or (ii) to the extent such transaction constitutes an Investment, such
transaction is permitted under Section 7.02;




     (e) Dispositions permitted by Sections 7.04 and 7.06;




     (f) Dispositions by the Specified U.S. Borrower and its Subsidiaries of property
pursuant to sale-leaseback transactions; provided that (i) the fair market value of
all property so Disposed of shall not exceed $25,000,000 from and after the Closing Date and
(ii) the purchase price for such property shall be paid to the Specified U.S. Borrower or
such Subsidiary for not less than 75% cash consideration;




     (g) Dispositions of cash and Cash Equivalents;




     (h) Dispositions of (i) defaulted Accounts of financially-troubled debtors in
connection with the collection or compromise thereof, (ii) Accounts of Subsidiaries of the
Specified U.S. Borrower that are not Loan Parties in connection with the collection or
compromise thereof and (iii) with 10 days’ prior notice to the Administrative Agent, other
Accounts as to which the applicable Loan Party or other Subsidiary has reasonable concerns
as to credit quality;




     (i) licensing or sublicensing of IP Rights in the ordinary course of business;




     (j) leases, subleases, licenses or sublicenses of property in the ordinary course of
business and which do not materially interfere with the business of the Specified U.S.
Borrower and its Subsidiaries;




     (k) transfers of property subject to casualty events upon receipt of the net cash
proceeds of such casualty event;



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     (l) Dispositions by the Specified U.S. Borrower and its Subsidiaries not otherwise
permitted under this Section 7.05; provided that (i) at the time of such
Disposition, no Event of Default shall exist or would result from such Disposition, (ii) the
aggregate fair market value of all property Disposed of in reliance on this clause (l) shall
not exceed $75,000,000 since the Closing Date (excluding any property Disposed of in a
Disposition or series of related Dispositions involving property with an aggregate fair
market value of less than $5,000,000), and (iii) the purchase price for such property shall
be paid to the Specified U.S. Borrower or such Subsidiary for not less than 75% cash
consideration;




     (m) Dispositions of assets set forth on Schedule 7.05;




     (n) voluntary terminations of Swap Contracts; and




     (o) the issuance or Disposition of Equity Interests of any Subsidiary, whether in a
single transaction or a series of related transactions, to the extent constituting an
Investment in a joint venture engaged in a line of business permitted under Section
7.07; provided that the aggregate fair market value of all such Investments and
all property Disposed of in reliance on this clause (o) shall not exceed $25,000,000
over the term of this Agreement; and provided further that any such joint
venture formed by the issuance or Disposition of Equity Interests of any Subsidiary shall be
deemed to be an Investment or Disposition in an amount equal to the fair market value of
100% of the Equity Interests of such Subsidiary;




provided, however, that any Disposition of any property pursuant to this
Section 7.05 (except pursuant to Sections 7.05(d)(A)(i), (d)(B)(i),
(e), (h), (l) and (m)), shall be for no less than the fair
market value of such property at the time of such Disposition. To the extent any Collateral
is Disposed of as expressly permitted by this Section 7.05 (other than to a Loan
Party), such Collateral shall be sold free and clear of the Liens created by the Loan
Documents, and the Administrative Agent shall be authorized to take any actions deemed
appropriate in order to effect the foregoing. To the extent any Collateral is Disposed of
as expressly permitted by this Section 7.05 by a U.S. Loan Party to a Canadian Loan
Party, as long as such Collateral shall be subject to the Liens created by the Loan
Documents securing the Canadian Obligations, such Collateral shall be sold free and clear of
the Liens securing the U.S. Obligations.



          7.06 Restricted Payments. Declare or make, directly or indirectly, any Restricted
Payment, except:




     (a) each Subsidiary may make Restricted Payments to the Specified U.S. Borrower and to
Subsidiaries (and, in the case of a Restricted Payment by a non-wholly-owned Subsidiary, to
the Specified U.S. Borrower and any Subsidiary and to each other owner of Equity Interests
of such Subsidiary based on their relative ownership interests);




     (b) the Specified U.S. Borrower and each Subsidiary may declare and make dividend
payments or other distributions payable solely in the Equity Interests (other than
Disqualified Equity Interests) of such Person;




     (c) the Specified U.S. Borrower and any Subsidiary of the Specified U.S. Borrower may
make Restricted Payments, the proceeds of which will be used to repurchase the Equity
Interests of the Specified U.S. Borrower (or its direct or indirect parent entity) from, or
to make a Restricted Payment to any direct or indirect parent entity of the Specified U.S.
Borrower to enable it to repurchase its Equity Interests from, directors, employees or
members of management of any direct or indirect parent entity of the Specified U.S.
Borrower, the Specified U.S. Borrower



133









 







or any Subsidiary (or their estate, heirs, family members, spouse and/or former
spouse), in an aggregate amount not in excess of $7,500,000 in any calendar year plus the
proceeds of any key-man life insurance maintained by any direct or indirect parent entity of
the Specified U.S. Borrower, the Specified U.S. Borrower or any of its Subsidiaries;
provided that the Specified U.S. Borrower may carry-over and make in any subsequent
calendar year or years, in addition to the amount for such calendar year, the amount not
utilized in the prior calendar year or years up to a maximum of $15,000,000;




     (d) to the extent constituting Restricted Payments, the Specified U.S. Borrower and its
Subsidiaries may enter into transactions expressly permitted by Section 7.04,
7.08, or 7.14;




     (e) the Specified U.S. Borrower and any Subsidiary of the Specified U.S. Borrower may
make Restricted Payments to any direct or indirect parent entity of the Specified U.S.
Borrower:




     (i) the proceeds of which will be used to pay the tax liability for the
relevant jurisdiction in respect of consolidated, combined, unitary or affiliated
returns for the relevant jurisdiction of any direct or indirect parent entity of the
Specified U.S. Borrower attributable to the Specified U.S. Borrower and its
Subsidiaries determined as if the Specified U.S. Borrower and its Subsidiaries filed
separately;




     (ii) the proceeds of which shall be used to make a Restricted Payment to any
direct or indirect parent entity of the Specified U.S. Borrower to enable it to pay
operating expenses incurred in the ordinary course of business and other corporate
overhead costs and expenses (including, without limitation, administrative, legal,
accounting and similar expenses provided by third parties), which are reasonable and
customary and incurred in the ordinary course of business, in an aggregate amount
not to exceed $3,000,000 in any fiscal year plus any reasonable and customary
indemnification claims made by directors or officers of any direct or indirect
parent entity of the Specified U.S. Borrower, in each case to the extent
attributable to the ownership or operations of the Specified U.S. Borrower and its
Subsidiaries;




     (iii) the proceeds of which shall be used to make a Restricted Payment to any
direct or indirect parent entity of the Specified U.S. Borrower to enable it to pay
its franchise taxes (to the extent not constituting taxes of the nature described in
clause (i) of this Section 7.06(e)), to the extent attributable to the
ownership or operations of the Specified U.S. Borrower and its Subsidiaries;




     (iv) to finance (or to make a Restricted Payment to a direct or indirect parent
entity to finance) any Investment permitted to be made pursuant to Section
7.02; provided that (A) such Restricted Payment shall be made
concurrently with the closing of such Investment and (B) such direct or indirect
parent entity of the Specified U.S. Borrower shall, immediately following the
closing thereof, cause (1) all property acquired (whether assets or Equity
Interests) to be contributed to the Specified U.S. Borrower or its Subsidiaries or
(2) the merger (to the extent permitted in Section 7.04) of the Person
formed or acquired into the Specified U.S. Borrower or its Subsidiaries in order to
consummate such Investment; or




     (v) the proceeds of which shall be used by any direct or indirect parent entity
of the Specified U.S. Borrower to pay fees and expenses (other than to Affiliates)
certified to the Administrative Agent by an Officer of the Specified U.S. Borrower
and



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related to any unsuccessful equity or debt offering, to the extent that the
proceeds from such equity or debt offering were intended to directly benefit the
Specified U.S. Borrower and its Subsidiaries;




     (f) in addition to the foregoing Restricted Payments, the Specified U.S. Borrower may
make additional Restricted Payments to holders of its Equity Interests in an aggregate
amount for each fiscal year not to exceed the lesser of $25,000,000 and 15% of Consolidated
Net Income of the Specified U.S. Borrower for the immediately preceding fiscal year, so long
as before and after giving effect thereto (i) no Event of Default has occurred and is
continuing, (ii) Excess Availability shall be more than 25% of the Total Borrowing Base and
(iii) the Specified U.S. Borrower shall be in compliance with the covenant set forth in
Section 7.11 (whether or not such covenant is otherwise applicable under this
Agreement at such time) and shall have delivered to the Administrative Agent a pro forma
Compliance Certificate demonstrating such compliance;




     (g) repurchases of Equity Interests of the Specified U.S. Borrower deemed to occur upon
the non-cash exercise of stock options and warrants; and




     (h) so long as no Default shall have occurred and be continuing or would result
therefrom, the Specified U.S. Borrower may make Restricted Payments with the net cash
proceeds from any Permitted Equity Issuance (to the extent constituting Specified Issuance
Proceeds) received since the Closing Date or the net cash proceeds up to $25,000,000 of
Permitted Subordinated Debt received since the Closing Date, in each case, to the extent Not
Otherwise Applied (provided that the Specified U.S. Borrower must provide the Administrative
Agent with prompt notice of the application of such proceeds following such transaction as
required by Section 6.02(k)) and to the extent such proceeds were received within
180 days prior to the date of such Restricted Payment and held in segregated account pending
application pursuant to this clause (h).



          7.07 Change in Nature of Business. Engage in any material line of business
substantially different from those lines of business conducted by the Specified U.S. Borrower and
its Subsidiaries on the date hereof or any business reasonably related or ancillary thereto.



          7.08 Transactions with Affiliates. Enter into any transaction of any kind with any
Affiliate of the Specified U.S. Borrower, whether or not in the ordinary course of business, other
than (a) transactions (i) between or among U.S. Loan Parties, (ii) between or among Canadian Loan
Parties, (iii) between or among Canadian Loan Parties and U.S. Loan Parties on terms substantially
as favorable to the U.S. Loan Parties as would be obtainable by the U.S. Loan Parties at the time
in a comparable arm’s-length transaction with a Person other than an Affiliate, (iv) between or
among Canadian Loan Parties and Subsidiaries that are not Loan Parties on terms substantially as
favorable to the Canadian Loan Parties as would be obtainable by the Canadian Loan Parties at the
time in a comparable arm’s-length transaction with a Person other than an Affiliate, (v) between or
among Subsidiaries that are not Loan Parties and (vi) between or among the Loan Parties, the
Subsidiaries and/or any joint venture in which any of them owns an interest, in each case, in the
ordinary course of business, (b) on fair and reasonable terms substantially as favorable to the
applicable Borrower or such Subsidiary as would be obtainable by the applicable Borrower or such
Subsidiary at the time in a comparable arm’s-length transaction with a Person other than an
Affiliate, (c) the payment of fees, expenses and other payments made in connection with the
consummation of the Transactions, (d) equity issuances by the Specified U.S. Borrower or any
Subsidiary permitted under Section 7.06, (e) loans and other transactions among the
Specified U.S. Borrower and its Subsidiaries to the extent permitted under Section 7.06,
Section 7.01(p), clauses (b), (c), (e), (f), (k),
(l) and (m) of Section 7.02, clauses (b)(iii), (iv),
(v) and (xii) of Section 7.03, Section 7.04 or



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Section 7.05(d), (f) customary fees paid to any directors of the Specified U.S. Borrower (or
any direct or indirect parent company of the Specified U.S. Borrower to the extent reasonably
related to the operation of the Specified U.S. Borrower) and reimbursement of reasonable
out-of-pocket costs of the directors of the Specified U.S. Borrower (or any direct or indirect
parent company of the Specified U.S. Borrower to the extent reasonably related to the operation of
the Specified U.S. Borrower), (g) the Specified U.S. Borrower and its Subsidiaries may enter into
employment and severance arrangements with officers and employees in the ordinary course of
business, (h) the payment of customary fees and reasonable out-of-pocket costs to, and indemnities
provided on behalf of, directors, officers, employees and consultants of the Specified U.S.
Borrower and the Subsidiaries (or any direct or indirect parent company of the Specified U.S.
Borrower) in the ordinary course of business to the extent attributable to the ownership or
operation of the Specified U.S. Borrower and its Subsidiaries, as determined in good faith by the
board of directors of the Specified U.S. Borrower or senior management thereof, (i) transactions
pursuant to permitted agreements in existence on the Closing Date and set forth on Schedule
7.08 or any amendment thereto to the extent such an amendment is not adverse to the Lenders in
any material respect and (j) dividends, redemptions and repurchases permitted under Section
7.06.




          7.09 Burdensome Agreements. Enter into or permit to exist any Contractual Obligation
(other than this Agreement or any other Loan Document) that limits the ability (a) of any
Subsidiary of the Specified U.S. Borrower to make Restricted Payments to the Specified U.S.
Borrower or any Guarantor or to otherwise transfer property to or invest in any Borrower or any
Guarantor, except for any agreement in effect (i) on the date hereof and described on Schedule
7.09 hereto, (ii) at the time any Person becomes a Subsidiary, so long as such agreement was
not entered into solely in contemplation of such Person becoming a Subsidiary, (iii) representing
Indebtedness of a Subsidiary which is not a Loan Party which is permitted by Section 7.03,
or (iv) in connection with any Disposition permitted by Section 7.05 relating solely to the
assets to be disposed of, and (b) of the Specified U.S. Borrower or any Loan Party to create,
incur, assume or suffer to exist Liens on property of such Person for the benefit of the Lenders
with respect to the Revolving Credit Facility and the Obligations or under the Loan Documents
except for (i) negative pledges and restrictions on Liens in favor of any holder of Indebtedness
permitted under Section 7.03 but solely to the extent any negative pledge relates to the
property subject to a Lien permitted by Section 7.01 or (ii) customary restrictions on
leases, subleases, licenses or asset sale agreements otherwise permitted hereby so long as such
restrictions may relate to the assets subject thereto; provided, however, that
clauses (a) and (b) shall not prohibit Contractual Obligations that (i) are customary provisions in
joint venture agreements and other similar agreements applicable to joint ventures permitted under
Section 7.02 and applicable solely to such joint venture entered into in the ordinary
course of business, (ii) apply only to the property or assets securing Indebtedness permitted to be
secured by such property or assets by Section 7.01 and Section 7.03, (iii) are
customary provisions restricting subletting or assignment of any lease governing a leasehold
interest, (iv) are customary provisions restricting assignment of any agreement entered into in the
ordinary course of business, (v) are restrictions on cash or other deposits imposed by customers
under contracts entered into in the ordinary course of business or (vi) are restrictions or
conditions imposed by Law; provided, further, that any amendment, restatement,
amendment and restatement, modification, renewal, extension or (in the case such Contractual
Obligations are set forth in an agreement evidencing Indebtedness) refunding or refinancing
otherwise permitted hereunder of any Contractual Obligations that are permitted by clause (a) or
(b) above shall be permitted under this Section 7.09, so long as such amendment,
restatement, amendment and restatement, modification, renewal, extension, refunding or refinancing
does not further limit the ability of any Subsidiary of the Specified U.S. Borrower to make
Restricted Payments or to otherwise transfer property to or invest in any Borrower or any
Guarantor, or further limit the ability the Specified U.S. Borrower or any Loan Party to create,
incur, assume or suffer to exist Liens on property of such Person for the benefit of the Lenders
with respect to the Revolving Credit Facility and the Obligations or under the Loan Documents, or
otherwise expand the scope of such Contractual Obligation.



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          7.10 Use of Proceeds. Use the proceeds of any Credit Extension, whether directly or
indirectly, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to
extend credit to others for the purpose of purchasing or carrying margin stock or to refund
Indebtedness originally incurred for such purpose.



          7.11 Consolidated Fixed Charge Coverage Ratio. At any time when a Covenant Trigger
Event shall have occurred and be continuing, permit the Consolidated Fixed Charge Coverage Ratio as
of the end of the most recently completed Measurement Period of the Specified U.S. Borrower for
which financial statements have been delivered by the Specified U.S. Borrower pursuant to
Section 6.01 and for each Measurement Period thereafter until such Covenant Trigger Event
shall cease to be continuing, to be less than 1.1:1.0.



          7.12 Amendments of Organization Documents. Amend any of its Organization Documents in
a manner materially adverse to the Administrative Agent or the Lenders.



          7.13 Accounting Changes. Make any change in the periods covered by the Specified U.S.
Borrower’s fiscal year.



          7.14 Prepayments, Etc. of Indebtedness. (a) Prepay, redeem, purchase, defease or
otherwise satisfy prior to the date that occurs 30 days before the scheduled maturity thereof in
any manner any of the Senior Secured Notes, Permitted Seller Notes, Permitted Acquired Debt or
Permitted Subordinated Indebtedness (collectively, “Junior Financing”) or make any payment
in violation of any subordination terms of any Junior Financing Documentation, except so long as no
Default shall have occurred and is continuing or would result therefrom (i) the prepayment,
redemption, purchase or defeasance of any such Junior Financing with the net cash proceeds of any
Specified Issuance Proceeds Not Otherwise Applied (provided that the Specified U.S. Borrower must
provide the Administrative Agent with prompt notice of the application of such proceeds following
such transaction as required by Section 6.02(k)) to the extent that such proceeds were
received within 180 days prior to the date of such prepayment, redemption, purchase or defeasance
and held in a segregated account pending application pursuant to this Section 7.14, (ii)
the conversion of any Junior Financing to Equity Interests (other than Disqualified Equity
Interests) or (iii) the prepayment, redemption, purchase or defeasance of any such Junior
Financing, so long as immediately before and immediately after giving effect thereto (A) no Default
shall have occurred and be continuing or would result therefrom, (B) Excess Availability shall be
at least 20% of the Total Borrowing Base and (C) the Specified U.S. Borrower would be in pro forma
compliance with a Consolidated Fixed Charge Coverage Ratio of 1.0:1.0 (whether or not the covenant
in Section 7.11 is applicable at such time), provided that in each case such
payment is also permitted under the Senior Secured Notes Indenture, or (b) amend, modify or change
in any manner materially adverse to the interests of the Administrative Agent or the Lenders any
term or condition of any Junior Financing Documentation.



          7.15 Equity Interests of the Specified U.S. Borrower and Subsidiaries.



          (a) (i) Permit the Specified U.S. Borrower or any of its Subsidiaries to own directly or
indirectly less than 100% of the Equity Interests of any of the Domestic Subsidiaries except as a
result of or in connection with a transaction permitted by Section 7.04 or 7.05 or
an Investment in any Person permitted under Section 7.02;



          (b) Permit the Specified U.S. Borrower or any of its Subsidiaries to own directly or
indirectly less than 80% of the Equity Interests of any of the Foreign Subsidiaries which are
Subsidiaries except (A) to qualify directors where required by applicable Law or to satisfy other
requirements of applicable Law with respect to the ownership of Equity Interests of Foreign
Subsidiaries or (B) as a result



137









 




of or in connection with a transaction permitted by Section 7.04 and 7.05 or
an Investment in any Person permitted under Section 7.02; or




          (c) Create, incur, assume or suffer to exist any Lien on any Equity Interests of any Borrower
(other than Liens pursuant to the Loan Documents and non-consensual Liens arising solely by
operation of law and customary restrictions in joint venture agreements).



          7.16 Capital Expenditures. Make any Capital Expenditure, except for Capital
Expenditures incurred in connection with the lines of business of the Specified U.S. Borrower and
its Subsidiaries permitted pursuant to Section 7.07 not exceeding, in the aggregate for the
Specified U.S. Borrower and its Subsidiaries during each fiscal year set forth below, the amount
set forth opposite such fiscal year:



	 	 	 	 	 
	Fiscal Year	 	 	Amount
	2010
	 	$	36,800,000	 
	 
	 	 	 	 
	2011
	 	$	36,600,000	 
	 
	 	 	 	 
	2012
	 	$	36,900,000	 
	 
	 	 	 	 
	2013
	 	$	38,000,000	 





; provided that so long as no Default has occurred and is continuing or would result from
such expenditure, any portion of any amount set forth above, if not expended in the fiscal year for
which it is permitted above, may be carried over for expenditure in the immediately succeeding
fiscal year and shall be deemed to be the last Dollars spent for Capital Expenditures in such
succeeding fiscal year.




          7.17 Designation of Senior Debt. Designate any Indebtedness of the Specified U.S.
Borrower or any of its Subsidiaries other than the Facilities as “Designated Senior Debt” (or any
comparable term) under, and as defined in, any applicable Junior Financing Documentation.



          7.18 Approved Plan of Reorganization. Permit the Approved Plan of Reorganization to
be amended, supplemented or otherwise modified in a manner that could have a Material Adverse
Effect on the rights and interests of the Lenders.



ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES




          8.01 Events of Default. Any of the following shall constitute an Event of Default:




     (a) Non-Payment. Any Borrower or any other Loan Party fails to (i) pay when
and as required to be paid herein, any amount of principal of any Loan or any L/C Obligation
or deposit any funds as Cash Collateral in respect of L/C Obligations, or (ii) pay within
three days after the same becomes due, any interest on any Loan or on any L/C Obligation, or
any fee due hereunder, or (iii) pay within seven days after the same becomes due, any other
amount payable hereunder or under any other Loan Document; or




     (b) Specific Covenants. (i) Any Borrower fails to perform or observe any term,
covenant or agreement contained in any of Sections 6.03, 6.05, 6.11,
6.18(a)(iv), (v) or (vi), 6.19 or Article VII, (ii)
any of the Guarantors fails to perform or observe any term, covenant or



138









 







agreement contained in Section 7 of the Guaranties or Section 3.7 of
the respective Mortgages to which it is a party; or




     (c) Other Defaults. (i) Any Loan Party fails to perform or observe any term,
covenant or agreement contained in Section 6.01(f) and 6.10 on its part to
be performed or observed and such failure continues for two days; (ii) any Loan Party fails
to perform or observe any term, covenant or agreement contained in any of Sections
6.01(a), (b), (c), (d) or (e), 6.18 (other than
Sections 6.18(a)(iv), (v), (vi) or (b)(ii)) on its part to
be performed or observed and such failure continues for five days; (iii) any Loan Party
fails to perform or observe any term, covenant or agreement contained in Section
6.07 on its part to be performed or observed and such failure continues for 10 days; or
(iv) any Loan Party fails to perform or observe any other covenant or agreement (not
specified in Section 8.01(a) or (b), (c)(i), (c)(ii) or
(c)(iii) above) contained in any Loan Document on its part to be performed or
observed and such failure continues for 30 days after notice thereof by the Administrative
Agent to the Specified U.S. Borrower; or




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




     (e) Cross-Default. (i) Any Non-Excluded Party (A) fails to make any payment
(after giving effect to any applicable grace periods, cures or waivers) when due (whether by
scheduled maturity, required prepayment, acceleration, demand, or otherwise) in respect of
any Indebtedness or Guarantee (other than Indebtedness hereunder and Indebtedness under Swap
Contracts) having an aggregate outstanding principal amount (including amounts owing to all
creditors under any combined or syndicated credit arrangement) of more than the Threshold
Amount, or (B) fails to observe or perform any other agreement or condition relating to any
such Indebtedness or Guarantee or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event occurs, the effect of which default or
other event is to cause, or to permit the holder or holders of such Indebtedness or the
beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause, in each case with the giving of
notice if required but after giving effect to any applicable grace periods, cures or
waivers, such Indebtedness to be demanded or to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or an offer to repurchase, prepay,
defease or redeem such Indebtedness to be made, prior to its stated maturity, or such
Guarantee to become payable or cash collateral in respect thereof to be demanded; or (ii)
there occurs under any Swap Contract an Early Termination Date (as defined in such Swap
Contract) resulting from (A) any event of default under such Swap Contract as to which a
Non-Excluded Party is the Defaulting Party (as defined in such Swap Contract) or (B) any
Termination Event (as so defined) under such Swap Contract as to which a Non-Excluded Party
is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed
by such Non-Excluded Party as a result thereof is greater than the Threshold Amount; or




     (f) Proceedings under Debtor Relief Laws, Etc. Any Non-Excluded Party
institutes or consents to the institution of any proceeding under any Debtor Relief Law, or
makes an assignment for the benefit of creditors; or applies for or consents to the
appointment of any receiver, interim receiver, monitor, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer for it or for all or any material part of its
property; or any receiver, interim receiver, monitor, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is



139









 







appointed without the application or consent
of such Person and the appointment continues
undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor
Relief Law relating to any such Person or to all or any material part of its property is
instituted without the consent of such Person and continues undismissed or unstayed for 60
calendar days, or an order for relief is entered in any such proceeding; or




     (g) Inability to Pay Debts; Attachment. (i) Any Non-Excluded Party becomes
unable or admits in writing its inability or fails generally to pay its debts as they become
due, or (ii) any writ or warrant of attachment or execution or similar process is issued or
levied against all or any material part of the property of any such Person and is not
released, vacated or fully bonded within 45 days after its issue or levy; or




     (h) Judgments. There is entered against any Non-Excluded Party (i) one or more
final judgments or orders for the payment of money in an aggregate amount (as to all such
judgments and orders) exceeding the Threshold Amount (to the extent not covered by
independent third-party insurance as to which the insurer is rated at least “A” by A.M. Best
Company, has been notified of the potential claim and does not dispute coverage), or (ii)
any one or more non-monetary final judgments that have, or could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect and, in either case, (A)
enforcement proceedings are commenced by any creditor upon such judgment or order, and (B)
there is a period of 45 consecutive days during which a stay of enforcement of such
judgment, by reason of a pending appeal or otherwise, is not in effect; or




     (i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan,
Multiemployer Plan or a Canadian Pension Plan which has resulted or could reasonably be
expected to result in liability of the Borrowers under Title IV of ERISA to the Pension
Plan, Multiemployer Plan, Canadian Pension Plan or the PBGC or other applicable Governmental
Authority in an aggregate amount in excess of the Threshold Amount, (ii) any Borrower or any
ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period,
any installment payment with respect to its withdrawal liability under Section 4201 of ERISA
under a Multiemployer Plan in an aggregate amount in excess of the Threshold Amount or (iii)
a Termination Event shall occur which, in the Administrative Agent’s determination,
constitutes grounds for the termination under any Law, of any Canadian Pension Plan or for
the appointment by the appropriate Governmental Authority of a trustee for any Canadian
Pension Plan, or if any Canadian Pension Plan shall be terminated or any such trustee shall
be requested or appointed, or if any Canadian Loan Party is in default with respect to
payments to a Multiemployer Plan or Canadian Pension Plan resulting from its complete or
partial withdrawal from such Canadian Pension Plan, in each case, where the liability of the
Canadian Borrower is or could reasonably be expected to be in an aggregate amount in excess
of the Threshold Amount, or any Canadian Loan Party fails to make a required contribution in
respect of a Canadian Pension Plan and such failure gives rise to a Lien; or




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




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



140









 






     (l) Collateral Documents. Any Collateral Document after delivery thereof
pursuant to Section 4.01 or 6.12 shall for any reason (other than pursuant
to the terms thereof) cease to create a valid and perfected first priority Lien (subject to
Liens permitted by Section 7.01) on the Collateral purported to be covered thereby;
or




     (m) Subordination. (i) The subordination provisions of the documents
evidencing or governing any subordinated Indebtedness (the “Subordination
Provisions”) shall, in whole or in part, terminate, cease to be effective or cease to be
legally valid, binding and enforceable against any holder of the applicable subordinated
Indebtedness; or (ii) any Borrower or any other Loan Party shall, directly or indirectly,
disavow or contest in any manner (A) the effectiveness, validity or enforceability of any of
the Subordination Provisions, (B) that the Subordination Provisions exist for the benefit of
the Administrative Agent, the Lenders and the L/C Issuers or (C) that all payments of
principal of or premium and interest on the applicable subordinated Indebtedness, or
realized from the liquidation of any property of any Loan Party, shall be subject to any of
the Subordination Provisions; or




     (n) Confirmation Order. (i) Any Loan Party shall fail to comply in any
material respect with the Confirmation Order or any other applicable order or stipulation
entered by the Bankruptcy Court in the Cases, unless such failure is not materially adverse
to the interests of the Lenders, as reasonably determined by the Required Initial Lenders;
or (ii) the Confirmation Order is revoked, remanded, vacated, reversed, rescinded, or
modified or amended in any manner, except in a manner that is not materially adverse to the
Lenders or the Administrative Agent, as reasonably determined by the Required Initial
Lenders.



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




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




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




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




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


provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Specified U.S. Borrower under any Debtor Relief Laws, the
obligation of each Lender to make Loans and any obligation of the L/C Issuers to make L/C Credit
Extensions shall automatically terminate, the unpaid principal amount of all outstanding Loans and
all interest and other amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrowers to Cash Collateralize the L/C Obligations as aforesaid shall
automatically become effective, in each case without further act of the Administrative Agent or any
Lender.







141









 








          8.03 Application of Funds. After the occurrence and during the continuance of an
Event of Default, at the election of the Administrative Agent or the Required Lenders (or after the
Loans have become immediately due and payable and the L/C Obligations have been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), any amounts received on
account of the Obligations shall be applied by the Administrative Agent in the following order:



          (a) With respect to amounts received from or on account of any U.S. Loan Party, or in respect
of any U.S. Collateral,




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




     Second, to payment of that portion of the U.S. Obligations constituting fees,
indemnities and other amounts (other than principal, interest, U.S. Letter of Credit fees
and commitment fees) payable to the U.S. Lenders and the U.S. L/C Issuers (including fees,
charges and disbursements of counsel to the respective U.S. Lenders and the U.S. L/C Issuers
payable under the Loan Documents and amounts payable under Article III (in each
case, other than fees, indemnities and other amounts, and amounts then payable under Article
III, arising under Secured Cash Management Agreements and Secured Hedge Agreements), ratably
among them in proportion to the respective amounts described in this clause Second
payable to them;




     Third, to payment of that portion of the U.S. Obligations constituting accrued
and unpaid U.S. Letter of Credit fees, commitment fees and interest on the U.S. Loans, U.S.
L/C Borrowings and other U.S. Obligations arising under the Loan Documents, ratably among
the U.S. Lenders and the U.S. L/C Issuers in proportion to the respective amounts described
in this clause Third payable to them;




     Fourth, to payment of that portion of the U.S. Obligations constituting unpaid
principal of the U.S. Loans and U.S. L/C Borrowings, ratably among the U.S. Lenders and the
U.S. L/C Issuers in proportion to the respective amounts described in this clause
Fourth held by them;




     Fifth, to the Administrative Agent for the account of the U.S. L/C Issuers, to
Cash Collateralize that portion of U.S. L/C Obligations comprising the aggregate undrawn
amount of U.S. Letters of Credit;




     Sixth, to the Canadian Obligations in the order set forth in Section
8.03(b);




     Seventh, to payment of that portion of the U.S. Obligations then owing under
U.S. Secured Cash Management Agreements, ratably among the U.S. Cash Management Banks;




     Eighth, to payment of that portion of the U.S. Obligations then owing under
U.S. Secured Hedge Agreements, ratably among the U.S. Hedge Banks; and




     Last, the balance, if any, after all of the Obligations have been paid in full
in cash, to the Borrowers or as otherwise required by Law.




     (b) With respect to amounts received from or on account of any Canadian Loan Party or in
respect of any Canadian Collateral, or, after all of the U.S. Obligations set forth in clauses
first



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through fifth above have been paid in full in cash in accordance with Section
8.03(a), from or on account of any U.S. Loan Party, or in respect of any U.S. Collateral,





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




     Second, to payment of that portion of the Canadian Obligations constituting
fees, indemnities and other amounts (other than principal, interest, Canadian Letter of
Credit fees and commitment fees) payable to the Canadian Lenders and the Canadian L/C
Issuers (including fees, charges and disbursements of counsel to the respective Canadian
Lenders and the Canadian L/C Issuers arising under the Loan Documents and amounts payable
under Article III (in each case, other than fees, indemnities and other amounts, and
amounts then payable under Article III, arising under Secured Cash Management Agreements and
Secured Hedge Agreements), ratably among them in proportion to the respective amounts
described in this clause Second payable to them;




     Third, to payment of that portion of the Canadian Obligations constituting
accrued and unpaid Canadian Letter of Credit fees, commitment fees and interest on the
Canadian Loans, Canadian L/C Borrowings and other Canadian Obligations arising under the
Loan Documents, ratably among the Canadian Lenders and the Canadian L/C Issuers in
proportion to the respective amounts described in this clause Third payable to them;




     Fourth, to payment of that portion of the Canadian Obligations constituting
unpaid principal of the Canadian Loans and Canadian L/C Borrowings, ratably among the
Canadian Lenders and the Canadian L/C Issuers in proportion to the respective amounts
described in this clause Fourth held by them;




     Fifth, to the Administrative Agent for the account of the Canadian L/C Issuers,
to Cash Collateralize that portion of Canadian L/C Obligations comprising the aggregate
undrawn amount of Canadian Letters of Credit; and




     Sixth, to payment of that portion of the Canadian Obligations then owing under
Canadian Secured Cash Management Agreements, ratably among the Canadian Cash Management
Banks;




     Seventh, to payment of that portion of the Canadian Obligations then owing
under Canadian Secured Hedge Agreements, ratably among the Canadian Hedge Banks;




     Last, the balance, if any, after all of the Obligations have been paid in full
in cash, to the Borrowers or as otherwise required by Law.


Subject to Section 2.03(b), amounts used to Cash Collateralize the aggregate undrawn amount
of Letters of Credit pursuant to Section 8.03(a), clause Fifth above, and
Section 8.03(b), clause Fifth above, shall be applied to satisfy drawings under
such Letters of Credit as they occur. If any amount remains on deposit as Cash Collateral after
all Letters of Credit have either been fully drawn or expired, such remaining amount shall be
applied to the other Obligations, if any, in the order set forth above.



Notwithstanding the foregoing, Obligations arising under Secured Cash Management Agreements and
Secured Hedge Agreements shall be excluded from the application described above if the
Administrative Agent has not received written notice thereof, together with such supporting
documentation as the






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Administrative Agent may reasonably request, from the applicable Cash Management Bank or Hedge
Bank, as the case may be. Each Cash Management Bank or Hedge Bank not a party to this Agreement
that has given the notice contemplated by the preceding sentence shall, by such notice, be deemed
to have acknowledged and accepted the appointment of the Administrative Agent pursuant to the terms
of Article IX hereof for itself and its Affiliates as if a “Lender” party hereto.




          8.04 Collection Allocation Mechanism.



          (a) On the CAM Exchange Date, (i) each U.S. Revolving Credit Lender shall immediately be
deemed to have acquired (and shall promptly make payment therefor to the Administrative Agent in
accordance with Section 2.04(A)(c)(ii)) participations in the U.S. Swing Line Loans in an
amount equal to such U.S. Revolving Lender’s Applicable Percentage of each U.S. Swing Line Loan
outstanding on such date, (ii) each U.S. Revolving Credit Lender shall immediately be deemed to
have acquired (and shall promptly make payment therefor to the Administrative Agent in accordance
with Section 2.03) participations in the Outstanding Amount of U.S. L/C Obligations with
respect to each U.S. Letter of Credit in an amount equal to such U.S. Revolving Credit Lender’s
Applicable Percentage of the aggregate amount available to be drawn under such U.S. Letter of
Credit, (iii) each Canadian Revolving Credit Lender shall immediately be deemed to have acquired
(and shall promptly make payment therefor to the Administrative Agent in accordance with
Section 2.04(B)(c)(ii)) participations in the Canadian Swing Line Loans in an amount equal
to such Canadian Lender’s Applicable Percentage of each Canadian Swing Line Loan outstanding on
such date, (iv) each Canadian Revolving Credit Lender shall immediately be deemed to have acquired
(and shall promptly make payment therefor to the Administrative Agent in accordance with
Section 2.03) participations in the Outstanding Amount of Canadian L/C Obligations with
respect to each Canadian Letter of Credit in an amount equal to such Canadian Revolving Credit
Lender’s Applicable Percentage of the aggregate amount available to be drawn under such Canadian
Letter of Credit, (v) simultaneously with the automatic conversions pursuant to clause (vi) below,
the Lenders shall automatically and without further act (and without regard to the provisions of
Section 11.04) be deemed to have exchanged interests in the Loans (other than the Swing
Line Loans) and participations in the Swing Line Loans and Letters of Credit, such that in lieu of
the interest of each Lender in each Loan, and L/C Obligations in which it shall participate as of
such date (including such Lender’s interest in the Obligations, Guaranties and Collateral of each
Loan Party in respect of each such Loan and L/C Obligations), such Lender shall hold an interest in
every one of the Loans (other than the Swing Line Loans) and a participation in every one of the
Swing Line Loans and all of the L/C Obligations (including the Obligations, Guaranties and
Collateral of each Loan Party in respect of each such Loan), whether or not such Lender shall
previously have participated therein, equal to such Lender’s CAM Percentage thereof and (vi)
simultaneously with the deemed exchange of interests pursuant to clause (v) above, the interest in
the Loans denominated in Canadian Dollars to be received in such deemed exchange shall be converted
into Obligations denominated in Dollars and on and after such date all amounts accruing and owed to
Lenders in respect of such Obligations shall accrue and be payable in Dollars at the rates
otherwise applicable hereunder. Each Lender and each Loan Party hereby consents and agrees to the
CAM Exchange, and each Lender agrees that the CAM Exchange shall be binding upon its successors and
assigns and any person that acquires a participation in its interests in any Loan or any
participation in any Swing Line Loan or Letter of Credit. Each Loan Party agrees from time to time
to execute and deliver to the Administrative Agent all such promissory notes and other instruments
and documents as the Administrative Agent shall reasonably request to evidence and confirm the
respective interests of the Lenders after giving effect to the CAM Exchange, and each Lender agrees
to surrender any promissory notes originally received by it in connection with its Loans hereunder
to the Administrative Agent against delivery of any promissory notes evidencing its interests in
 the Loans so executed and delivered; provided, however, that the failure of any
Loan Party to execute or deliver or of any Lender to accept any such promissory note, instrument or
document shall not affect the validity or effectiveness of the CAM Exchange.



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          (b) As a result of the CAM Exchange, upon and after the CAM Exchange Date, each payment
received by Administrative Agent pursuant to any Loan Document in respect of any of the
Obligations, and each distribution made by the Administrative Agent in respect of the Obligations,
shall be distributed to the Lenders pro rata in accordance with their respective CAM Percentages.
Any direct payment received by a Lender upon or after the CAM Exchange Date, including by way of
setoff, in respect of an Obligation shall be paid over to the Administrative Agent for distribution
to the Lenders in accordance herewith.



          (c) The provisions of this Section 8.04 are solely an agreement among the Lenders for
the purpose of allocating risk and the Borrowers have no additional obligations with respect
thereto.



ARTICLE IX

ADMINISTRATIVE AGENT




          9.01 Appointment and Authority.



          (a) Each of the Lenders and each L/C Issuer hereby irrevocably appoints Bank of America
(including with respect to the Canadian Revolving Credit Facility, acting through Bank of
America-Canada Branch) to act on its behalf as the Administrative Agent hereunder and under the
other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and
to exercise such powers as are delegated to the Administrative Agent by the terms hereof or
thereof, together with such actions and powers as are reasonably incidental thereto. Except for
Sections 9.06 and 9.10, the provisions of this Article are solely for the benefit of the
Administrative Agent, the Lenders and the L/C Issuers, and neither the Borrowers nor any other Loan
Parties shall have rights as a third party beneficiary of any of such provisions.



          (b) Each of the Lenders (including in its capacities as a potential Hedge Bank and a potential
Cash Management Bank), each Collateral Agent and each of the L/C Issuers hereby irrevocably
appoints and authorizes the Administrative Agent to act as the agent of such Lender, such
Collateral Agent and such L/C Issuer for purposes of acquiring, holding and enforcing any and all
Liens on Collateral granted by any of the Loan Parties to secure any of the Obligations, together
with such powers and discretion as are reasonably incidental thereto. In this connection, the
Administrative Agent, and any co-agents, sub-agents and attorneys-in-fact appointed by the
Administrative Agent pursuant to Section 9.05 for purposes of holding or enforcing any Lien
on the Collateral (or any portion thereof) granted under the Collateral Documents, or for
exercising any rights and remedies thereunder at the direction of the Administrative Agent, shall
be entitled to the benefits of all provisions of this Article IX and Article XI
(including Section 11.04(c), as though such co-agents, sub-agents and attorneys-in-fact
were the “Administrative Agent” under the Loan Documents) as if set forth in full herein with
respect thereto.



          (c) For the purposes of creating a solidarité active in accordance with Article 1541 of the
Civil Code of Quebec between each Secured Party, taken individually, on the one hand, and the
Administrative Agent, on the other hand, each Loan Party and each such Secured Party acknowledges
and agrees with the Administrative Agent that such Secured Party and the Administrative Agent are
hereby conferred the legal status of solidary creditors of each such Loan Party in respect of all
Obligations owed by each such Loan Party to the Administrative Agent and such Secured Party
hereunder and under the other Loan Documents (collectively, the “Solidary Claim”) and that,
accordingly, but subject (for the avoidance of doubt) to Articles 1542 and 1543 of the Civil Code
of Québec, each such Loan Party is irrevocably bound towards the Administrative Agent and each
Secured Party in respect of the entire Solidary Claim of the Administrative Agent and such Secured
Party. As a result of the foregoing, the parties hereto acknowledge that the Administrative Agent
and each Secured Party shall at all times have a



145









 







valid and effective right of action for the entire
Solidary Claim of the Administrative Agent and such
Secured Party and the right to give full acquittance for it. Accordingly, and without
limiting the generality of the foregoing, the Administrative Agent, as solidary creditor with each
Secured Party, shall at all times have a valid and effective right of action in respect of the
Solidary Claim and the right to give a full acquittance for same. By its execution of the Loan
Documents to which it is a party, each such Loan Party and Secured Party not a party hereto shall
also be deemed to have accepted the stipulations hereinabove provided. The parties further agree
and acknowledge that such Liens (hypothecs) under the Collateral Documents and the other Loan
Documents shall be granted to the Administrative Agent, for its own benefit and for the benefit of
the Secured Parties, as solidary creditor as hereinabove set forth.



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



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




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




     (b) shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly contemplated hereby
or by the other Loan Documents that the Administrative Agent is required to exercise as
directed in writing by the Required Lenders, Required U.S. Lenders or Required Canadian
Lenders (or such other number or percentage of the Lenders as shall be expressly provided
for herein or in the other Loan Documents), provided that the Administrative Agent
shall not be required to take any action that, in its opinion or the opinion of its counsel,
may expose the Administrative Agent to liability or that is contrary to any Loan Document or
applicable law; and




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



          The Administrative Agent shall not be liable for any action taken or not taken by it (i) with
the consent or at the request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 11.01 and 8.02) or (ii)
in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall
be deemed to not have knowledge of any Default unless and until notice describing such Default is
given to the Administrative Agent by a Borrower, a Lender or an L/C Issuer.



          The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire
into (i) any statement, warranty or representation made in or in connection with this Agreement or



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any other Loan Document, (ii) the contents of any certificate, report or other document delivered
hereunder or thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set forth herein or
therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or
genuineness of this Agreement, any other Loan Document or any other agreement, instrument or
document, or the creation, perfection or priority of any Lien purported to be created by the
Collateral Documents, (v) the value or the sufficiency of any Collateral, or (v) the satisfaction
of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt
of items expressly required to be delivered to the Administrative Agent.



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



          9.05 Delegation of Duties.



          (a) The Administrative Agent may perform any and all of its duties and exercise its rights and
powers hereunder or under any other Loan Document by or through any one or more individual(s) or
institution(s) as separate trustee(s), co-trustee(s), collateral agent(s), collateral sub-agent(s)
or collateral co-agent(s) (any such additional individual or institution being referred to herein
as a “Supplemental Collateral Agent”) appointed by the Administrative Agent. The
Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its
rights and powers by or through their respective Related Parties. The exculpatory provisions of
this Article shall apply to any such sub-agent and to the Related Parties of the Administrative
Agent and any such sub-agent, and shall apply to their respective activities in connection with the
syndication of the credit facilities provided for herein as well as activities as Administrative
Agent.



          (b) In the event that the Administrative Agent appoints a Supplemental Collateral Agent with
respect to any Collateral, (i) each and every right, power, privilege or duty expressed or intended
by this Agreement or any of the other Loan Documents to be exercised by or vested in or conveyed to
the Administrative Agent with respect to such Collateral shall be exercisable by and vest in such
Supplemental Collateral Agent to the extent, and only to the extent, necessary to enable such
Supplemental Collateral Agent to exercise such rights, powers and privileges with respect to such
Collateral and to perform such duties with respect to such Collateral, and every covenant and
obligation contained in the Loan Documents and necessary to the exercise or performance thereof by
such Supplemental Collateral Agent shall run to and be enforceable by either the Administrative
Agent or such Supplemental Collateral Agent, and (ii) the provisions of this Article and of
Section 11.04 that refer to the Administrative Agent shall inure to the benefit of such
Supplemental Collateral Agent and all references therein to the Administrative Agent shall be
deemed to be references to the Administrative Agent and/or such Supplemental Collateral Agent, as
the context may require.



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          (c) Should any instrument in writing from any Loan Party be required by any Supplemental
Collateral Agent so appointed by the Administrative Agent for more fully and certainly vesting in
and confirming to him or it such rights, powers, privileges and duties, such Loan Party shall
execute, acknowledge and deliver any and all such instruments promptly upon request by the
Administrative Agent. In case any Supplemental Collateral Agent, or a successor thereto, shall
die, become incapable of acting, resign or be removed, all the rights, powers, privileges and
duties of such Supplemental Collateral Agent, to the extent permitted by law, shall vest in and be
exercised by the Administrative Agent until the appointment of a new Supplemental Collateral Agent.



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



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



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          9.08 No Other Duties, Etc. Anything herein to the contrary notwithstanding, none of
the Bookrunners, Syndication Agents or Documentation Agents listed on the cover page hereof shall
have any powers, duties or responsibilities under this Agreement or any of the other Loan
Documents, except in its capacity, as applicable, as the Administrative Agent, a Collateral Agent,
a Lender, a Swing Line Lender or an L/C Issuer hereunder.



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




     (a) to file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans, L/C Obligations and all other Obligations that are owing
and unpaid and to file such other documents as may be necessary or advisable in order to
have the claims of the Lenders, the L/C Issuers and the Administrative Agent (including any
claim for the reasonable compensation, expenses, disbursements and advances of the Lenders,
the L/C Issuers and the Administrative Agent and their respective agents and counsel and all
other amounts due the Lenders, the L/C Issuers and the Administrative Agent under
Sections 2.03(h) and (i), 2.09 and 11.04) allowed in such
judicial proceeding; and




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


and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender and each L/C Issuer to make
such payments to the Administrative Agent and, if the Administrative Agent shall consent to the
making of such payments directly to the Lenders and the L/C Issuers, to pay to the Administrative
Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent
under Sections 2.09 and 11.04.




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



          9.10 Collateral and Guaranty Matters. Each of the Lenders (including in its
capacities as a potential Cash Management Bank and a potential Hedge Bank) and the L/C Issuers
irrevocably authorize the Administrative Agent, at its option and in its discretion,




     (a) to release any Lien on any property granted to or held by the Administrative Agent
under any Loan Document (i) upon termination of the Aggregate Commitments and payment in
full of all Obligations (other than (A) contingent indemnification obligations and (B)
obligations and liabilities under Secured Cash Management Agreements and Secured Hedge
Agreements as to which arrangements reasonably satisfactory to the applicable Cash
Management Bank or Hedge Bank shall have been made) and the expiration or termination of all
Letters of Credit (other than Letters of Credit as to which other arrangements reasonably
satisfactory to the Administrative Agent and the applicable L/C Issuer shall have been
made), (ii) that is sold or to be sold as part of or in connection with any sale permitted
hereunder or under




149












 






any other Loan Document, or (iii) if approved, authorized or ratified in writing
in accordance with Section 11.01;



          (b) to release any Guarantor from its obligations under the Guaranties if such Person
ceases to be a Subsidiary as a result of a transaction permitted hereunder or becomes a
joint venture permitted by and as described in Section 7.05(o); and



          (c) to subordinate any Lien on any property granted to or held by the Administrative
Agent under any Loan Document to the holder of any Lien on such property that is permitted
by Section 7.01(b), (c), (d), (f), (g), (h),
(j), (k), (m), (n), (o), (q), (s),
(t), (u), (v) or (w).



          Upon request by the Administrative Agent at any time, the Required Lenders will confirm in
writing the Administrative Agent’s authority to release or subordinate its interest in particular
types or items of property, or to release any Guarantor from its obligations under a Guaranty
pursuant to this Section 9.10. In each case as specified in this Section 9.10, the
Administrative Agent will, at the Borrowers’ expense, execute and deliver to the applicable Loan
Party such documents as such Loan Party may reasonably request to evidence the release of such item
of Collateral from the assignment and security interest granted under the Collateral Documents or
to subordinate its interest in such item, or to release such Guarantor from its obligations under
the Guaranties, in each case in accordance with the terms of the Loan Documents and this
Section 9.10.




          9.11 Secured Cash Management Agreements and Secured Hedge Agreements. No Cash
Management Bank or Hedge Bank that obtains the benefits of Section 8.03, any Guaranty or
any Collateral by virtue of the provisions hereof or of any Guaranty or any Collateral Document
shall have any right to notice of any action or to consent to, direct or object to any action
hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the
release or impairment of any Collateral) other than in its capacity as a Lender and, in such case,
only to the extent expressly provided in the Loan Documents. Notwithstanding any other provision
of this Article IX to the contrary, the Administrative Agent shall not be required to verify the
payment of, or that other reasonably satisfactory arrangements have been made with respect to,
Obligations arising under Secured Cash Management Agreements and Secured Hedge Agreements unless
the Administrative Agent has received written notice of such Obligations, together with such
supporting documentation as the Administrative Agent may request, from the applicable Cash
Management Bank or Hedge Bank, as the case may be. Upon the request of the Administrative Agent at
any time, the Hedge Banks and the Cash Management Banks shall provide to the Administrative Agent a
summary of outstanding obligations under any Cash Management Agreements or Swap Contracts secured
by a Lien on any asset of any Loan Party, as of such date as may be reasonably requested by the
Administrative Agent, showing the aggregate amount of such obligations determined on a
marked-to-market basis and such other information reasonably requested by the Administrative Agent.
At the request of the Administrative Agent from time to time, the Hedge Banks and the Cash
Management Banks shall provide to the Administrative Agent copies of any Cash Management Agreements
or Swap Contracts pursuant to which obligations secured by a Lien on any asset of any Loan Party
have been incurred.




ARTICLE X

[RESERVED]




ARTICLE XI

MISCELLANEOUS




          11.01 Amendments, Etc. No amendment or waiver of any provision of this Agreement or
any other Loan Document, and no consent to any departure by any Borrower or any other Loan Party






150









 







therefrom, shall be effective unless in writing signed by the Required Lenders and the
applicable Borrower or the applicable Loan Party, as the case may be, and acknowledged by the
Administrative Agent, and each such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, however, that no
such amendment, waiver or consent shall:





     (a) extend or increase the Commitment of any Lender (or reinstate any Commitment
terminated pursuant to Section 8.02) without the written consent of such Lender, it
being understood that amendments, waivers, consents or other modifications of conditions
precedent, covenants, Defaults or Events of Default or of mandatory reductions in the
Commitments shall not be deemed to constitute an increase in any Commitment;




     (b) increase the aggregate Commitments under the Revolving Credit Facility to an amount
greater than $350,000,000 without the consent of each Collateral Agent;




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




     (d) reduce the principal amount of, or the rate of interest specified herein on, any
Loan or L/C Borrowing, or (subject to clause (iv) of the second proviso to this Section
11.01) any fees or other amounts payable hereunder or under any other Loan Document
without the written consent of each Lender entitled to such amount; provided,
however, that only the consent of the Required Lenders shall be necessary to amend
the definition of “Default Rate” or to waive any obligation of the Borrowers to pay interest
or Letter of Credit Fees at the Default Rate;




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




     (f) change any provision of this Section 11.01 or the definition of “Required
Lenders”, “Required U.S. Lenders”, “Required Canadian Lenders”, “Supermajority Lenders” or
the “Required Initial Lenders” without the written consent of each Lender;




     (g) release all or substantially all of the Collateral in any transaction or series of
related transactions, without the written consent of each Lender (unless all Obligations
(other than contingent Obligations in respect of unasserted indemnity claims) have been paid
in full in cash and the Commitments terminated);




     (h) release all or substantially all of the value of the Guaranties, without the
written consent of each Lender, it being understood that the release of any Subsidiary from
a Guaranty is permitted pursuant to Section 9.10 (in which case such release may be
made by the Administrative Agent acting alone);




     (i) amend, modify or waive any provision of this Agreement, in each case governing the
rights of the Lenders under any Facility, without the written consent of Lenders holding a
majority in interest of the obligations under such Facility, if such amendment, modification
or waiver, or such provision, by its express terms applies only to such Facility (or only to
the Lenders thereunder) and if such amendment, modification or waiver adversely affects the
Lenders under such Facility;



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     (j) increase the advance rates set forth in the definition of the terms “U.S. Borrowing
Base” or “Canadian Borrowing Base” without the written consent of each Collateral Agent;




     (k) change or otherwise modify the eligibility criteria, eligible asset classes,
reserves, sublimits in respect of any Borrowing Base, or add new asset categories to any
Borrowing Base, or otherwise cause any Borrowing Base to be increased, in each case without
the written consent of the Supermajority Lenders; provided that this clause
(k) shall not limit the discretion of the Collateral Agents to change, establish or
eliminate any reserves, to add assets acquired in a Permitted Acquisition to any Borrowing
Base or to otherwise exercise their discretion or Credit Judgment in respect of any
determination expressly provided hereunder to be made by the Collateral Agents in their
discretion or Credit Judgment, all to the extent otherwise set forth herein; or




     (l) amend, modify or change the provisions of Section 8.04 or the definition of
“CAM Percentage” without the written consent of each Lender.


and provided, further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the applicable L/C Issuer in addition to the Lenders required above, affect
the rights or duties of such L/C Issuer under this Agreement or any Issuer Document relating to any
Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless
in writing and signed by the applicable Swing Line Lender in addition to the Lenders required
above, affect the rights or duties of such Swing Line Lender under this Agreement; (iii) no
amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in
addition to the Lenders required above, affect the rights or duties of the Administrative Agent
under this Agreement or any other Loan Document; (iv) any Fee Letters may be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties thereto; (v) any condition
set forth in Section 4.01 (other than Section 4.01(b)(ii)) and, in the case of the
initial Credit Extension, Section 4.02, and the provisions of Section 7.08 (solely
to the extent that any such amendment or waiver relates principally to transfer pricing of the
Specified U.S. Borrower and its Subsidiaries), may be amended or waived by the written consent of
only the Collateral Agents and the Loan Parties; and (vi) Schedule 2.01 may be modified
from time to time and technical and conforming modifications to the Loan Documents may be made to
the extent necessary to effectuate any Commitment Increase or Incremental Amendment pursuant to
Section 2.16, in each case with the prior written consent of the Administrative Agent, each
U.S. L/C Issuer, each U.S. Swing Line Lender, the Loan Parties and each Lender or Eligible Assignee
participating in such Commitment Increase pursuant to documentation satisfactory to the
Administrative Agent without the consent of any other Lender. Notwithstanding anything to the
contrary herein, no Defaulting Lender or Affiliated Lender shall have any right to approve or
disapprove any amendment, waiver or consent hereunder, except that the Commitment of such Lender
may not be increased or extended without the consent of such Lender.




          If any Lender does not consent to a proposed amendment, waiver, consent or release with
respect to any Loan Document that requires the consent of each Lender and that has been approved by
the Required Lenders, the Borrowers may replace such non-consenting Lender in accordance with
Section 11.13; provided that such amendment, waiver, consent or release can be
effected as a result of the assignment contemplated by such Section (together with all other such
assignments required by the Borrowers to be made pursuant to this paragraph).




          Subject to the restrictions set forth in the foregoing subparagraphs 11.01(a) to (l),
but notwithstanding anything else to the contrary contained in this Section 11.01, (a) with
respect to any provision contained in this Agreement relating to any Facility, the Administrative
Agent, the Borrowers and a majority in interest of the Lenders under such Facility shall be
permitted to amend such provision, without the consent of any other Lender, solely to the extent
reasonably necessary or advisable to






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(i) comply with applicable Law relating to such Facility or (ii) better implement the intentions
of this Agreement with respect to such Facility, and, in the case of any amendment made pursuant to
this clause (ii), solely to the extent that such amendment does not impair the rights, obligations
or interests of any other Lender under this Agreement in any material respect and (b) at any time
on or before the date that is sixty (60) days after the Closing Date, the Administrative Agent and
the Borrowers shall have jointly identified an obvious error or any error or omission of a
technical or immaterial nature, in each case, in any provision of the Loan Documents, then the
Administrative Agent and the Borrowers shall be permitted to amend such provision and such
amendment shall become effective without any further action or consent of any other party to any
Loan Document if the same is not objected to in writing by the Required Lenders within five (5)
Business Days following receipt of notice thereof.




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





     (i) if to the Borrowers, the Borrower Agent, the Administrative Agent, the Collateral
Agents, the L/C Issuers or the Swing Line Lenders, to the address, telecopier number,
electronic mail address or telephone number specified for such Person on Schedule
11.02; and




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


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



Each Loan Party located outside of the U.S. hereby irrevocably appoints the Borrower Agent as its
agent to receive on behalf of such Loan Party and its property service of copies of the summons and
complaint and any other process which may be served in any such action or proceeding. Such service
may be made by mailing or delivering a copy of such process to such Loan Party in care of the
Borrower Agent at the Borrower Agent’s address specified in this Agreement, and such Loan Party
hereby irrevocably authorizes and directs the Borrower Agent to accept such service on its behalf.
As an alternative method of service, each Loan Party also irrevocably consents to the service of
any and all process in any such action or proceeding by the mailing of copies of such process to
such Loan Party at its address specified in this Agreement.




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



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hereunder by electronic communications pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or communications.




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




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




          (d) Change of Address, Etc. Each Borrower, the Administrative Agent, each L/C Issuer
and each Swing Line Lender may change its address, telecopier or telephone number for notices and
other communications hereunder by notice to the other parties hereto. Each other Lender may change
its address, telecopier or telephone number for notices and other communications hereunder by
notice to the Borrower Agent, the Administrative Agent, the applicable L/C Issuer and the
applicable Swing Line Lender. In addition, each Lender agrees to notify the Administrative Agent
from time to time to ensure that the Administrative Agent has on record (i) an effective address,
contact name, telephone number, telecopier number and electronic mail address to which notices and
other communications may be sent and (ii) accurate wire instructions for such Lender. Furthermore,
each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to
at all times have selected the “Private Side Information” or similar designation on the content
declaration screen of the Platform in order to enable such Public Lender or its delegate, in
accordance with such Public Lender’s compliance procedures and applicable Law, including United
States federal and state securities Laws, to make reference to Borrower Materials that are not made
available through the “Public Side Information” portion of the Platform and that may contain
material non-public information with respect to the Borrowers or their securities for purposes of
United States federal or state securities Laws.







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




          11.03 No Waiver; Cumulative Remedies. No failure by any Lender, any L/C Issuer or the
Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy,
power or privilege hereunder or under any other Loan Document 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, and provided under each
other Loan Document, are cumulative and not exclusive of any rights, remedies, powers and
privileges provided by law.




          Notwithstanding anything to the contrary contained herein or in any other Loan Document, the
authority to enforce rights and remedies hereunder and under the other Loan Documents against the
Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law
in connection with such enforcement shall be instituted and maintained exclusively by, the
Administrative Agent in accordance with Section 8.02 for the benefit of all the Lenders and
the L/C Issuers; provided, however, that the foregoing shall not prohibit (a) the
Administrative Agent from exercising on its own behalf the rights and remedies that inure to its
benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan
Documents, (b) any L/C Issuer or any Swing Line Lender from exercising the rights and remedies that
inure to its benefit (solely in its capacity as L/C Issuer or Swing Line Lender, as the case may
be) hereunder and under the other Loan Documents, (c) any Lender from exercising setoff rights in
accordance with Section 11.08 (subject to the terms of Section 2.13), or (d) any
Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the
pendency of a proceeding relative to any Loan Party under any Debtor Relief Law; and
provided, further, that if at any time there is no Person acting as Administrative
Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the
rights otherwise ascribed to the Administrative Agent pursuant to Section 8.02 and (ii) in
addition to the matters set forth in clauses (b), (c) and (d) of the
preceding proviso and subject to Section 2.13, any Lender may, with the consent of the
Required Lenders, enforce any rights and remedies available to it and as authorized by the Required
Lenders.




          11.04 Expenses; Indemnity; Damage Waiver.




          (a) Costs and Expenses. The Borrowers shall pay (i) all reasonable and documented
out-of-pocket expenses incurred by the Bookrunners, Administrative Agent, each Collateral Agent and
each of their respective Affiliates (including the reasonable and documented fees, out-of-pocket
charges and disbursements of one firm of counsel for the Administrative Agent, the Collateral
Agents and the Bookrunners, taken as a whole (and, in the case of the preparation and negotiation
of this Agreement, one firm of counsel for each of the Collateral Agents), of one firm of local
counsel retained by the Administrative Agent in each relevant local jurisdiction and of one firm of
special counsel retained by the Administrative Agent for each relevant specialty), in connection
with the syndication of the credit facilities provided for herein, the preparation, negotiation,
execution, delivery and administration of this






155









 







Agreement and the other Loan Documents or any amendments, modifications or waivers of the
provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall
be consummated), (ii) all reasonable and documented out-of-pocket expenses incurred by each L/C
Issuer in connection with the issuance, amendment, renewal or extension of any Letter of Credit or
any demand for payment thereunder and (iii) all documented out-of-pocket expenses incurred by the
Administrative Agent, any Collateral Agent, any Lender or any L/C Issuer (including the fees,
charges and disbursements of any counsel for the Administrative Agent, any Collateral Agent, any
Lender or any L/C Issuer) in connection with the enforcement or protection of its rights (A) in
connection with this Agreement and the other Loan Documents, including its rights under this
Section, or (B) in connection with Loans made or Letters of Credit issued hereunder, including all
such documented out-of-pocket expenses incurred during any workout, restructuring or negotiations
in respect of such Loans or Letters of Credit. Without limitation of the forgoing, promptly
following demand therefor (subject to applicable Law), the Borrowers shall pay (a) all fees and
expenses of the Administrative Agent, the Collateral Agents and the Lenders required pursuant to
this Section 11.04(a), the Commitment Letter or any Fee Letter, and (b) all fees and
expenses of the Administrative Agent, the Collateral Agents and the Lenders in their respective
capacities as agents and/or lenders under the Existing Credit Facility and owing from the Specified
U.S. Borrower or any of its Subsidiaries pursuant to the Existing Credit Agreement, in each case,
that are accrued and unpaid as of the date hereof.




          (b) Indemnification by the Borrowers. The Borrowers shall jointly and severally
indemnify the Administrative Agent (and any sub-agent thereof), each Collateral Agent, each Lender
and each L/C Issuer, and each Related Party of any of the foregoing Persons (each such Person being
called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and reasonably related expenses (including the reasonable and
documented fees, out-of-pocket charges and disbursements of any counsel for any Indemnitee)
incurred by any Indemnitee or asserted against any Indemnitee by any third party or by any Borrower
or any other Loan Party arising out of, in connection with, or as a result of (i) the execution or
delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated
hereby or thereby, the performance by the parties hereto of their respective obligations hereunder
or thereunder or the consummation of the transactions contemplated hereby or thereby, or, in the
case of the Administrative Agent (and any sub-agent thereof) and its Related Parties only, the
administration of this Agreement and the other Loan Documents, (ii) any Loan or Letter of Credit or
the use or proposed use of the proceeds therefrom (including any refusal by any L/C Issuer to honor
a demand for payment under a Letter of Credit if the documents presented in connection with such
demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged
presence or Release of Hazardous Materials on or from any property owned or operated by any
Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to any
Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on contract, tort or
any other theory, whether brought by a third party or by any Borrower or any other Loan Party or
any such Borrower’s or such Loan Party’s directors, shareholders or creditors, and regardless of
whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to
any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or
related expenses (x) are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the bad faith, gross negligence or willful misconduct of such
Indemnitee or (y) result from a claim brought by any Borrower or any other Loan Party against an
Indemnitee for breach of such Indemnitee’s obligations hereunder or under any other Loan Document,
if such Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on
such claim as determined by a court of competent jurisdiction.




          (c) Reimbursement by Lenders. To the extent that any Borrower for any reason fails to
indefeasibly pay any amount required under subsection (a) or (b) of this Section to be paid by it
to the Administrative Agent (or any sub-agent thereof), any L/C Issuer or any Related Party of any
of the






156









 







foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such
sub-agent), such L/C Issuer or such Related Party, as the case may be, such Lender’s Applicable
Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment
is sought) of such unpaid amount, provided that the unreimbursed expense or indemnified
loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent (or any such sub-agent) or any L/C Issuer in its capacity as such,
or against any Related Party of any of the foregoing acting for the Administrative Agent (or any
such sub-agent) or any L/C Issuer in connection with such capacity. The obligations of the Lenders
under this subsection (c) are subject to the provisions of Section 2.12(d).




          (d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by
applicable law, no Borrower shall assert, and each Borrower hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages
(as opposed to direct or actual damages) arising out of, in connection with, or as a result of,
this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the
proceeds thereof. No Indemnitee referred to in subsection (b) above shall be liable for any
damages arising from the use by unintended recipients of any information or other materials
distributed to such unintended recipients by such Indemnitee through telecommunications, electronic
or other information transmission systems in connection with this Agreement or the other Loan
Documents or the transactions contemplated hereby or thereby other than for direct or actual
damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined
by a final and nonappealable judgment of a court of competent jurisdiction.




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




          (f) Survival. The agreements in this Section shall survive the resignation of the
Administrative Agent, any L/C Issuer and any Swing Line Lender, the replacement of any Lender, the
termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the
other Obligations.




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




          11.06 Successors and Assigns.







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          (a) Successors and Assigns Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that neither the Borrowers nor any other Loan Parties may assign
or otherwise transfer any of its rights or obligations hereunder without the prior written consent
of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of
its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of
Section 11.06(b), (ii) by way of participation in accordance with the provisions of
Section 11.06(d), or (iii) by way of pledge or assignment of a security interest subject to
the restrictions of Section 11.06(f) (and any other attempted assignment or transfer by any
party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their respective successors and
assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section
and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative
Agent, each L/C Issuer and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.




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




          (i) Minimum Amounts.





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




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




     (ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and obligations
under this Agreement with respect to the Loans or the Commitment assigned, except that this
clause (ii) shall not (A) apply to any Swing Line Lender’s rights and obligations in respect
of the applicable Swing Line Loans or (B) prohibit any Lender from assigning all or a
portion of its rights and obligations among separate Facilities on a non-pro rata basis;



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




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




     (B) the consent of the Administrative Agent (such consent not to be
unreasonably withheld or delayed) shall be required for assignments in respect of
any Commitment if such assignment is to a Person that is not a Lender with a
Commitment, an Affiliate of such Lender or an Approved Fund with respect to such
Lender;




     (C) the consent of the applicable L/C Issuer (such consent not to be
unreasonably withheld or delayed) shall be required for any assignment that
increases the obligation of the assignee to participate in exposure under one or
more Letters of Credit (whether or not then outstanding); and




     (D) the consent of the applicable Swing Line Lender (such consent not to be
unreasonably withheld or delayed) shall be required for any assignment in respect of
the Revolving Credit Facility.




     (iv) Assignment and Assumption. The parties to each assignment shall execute
and deliver to the Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee in the amount of $3,500; provided, however,
that the Administrative Agent may, in its sole discretion, elect to waive such processing
and recordation fee in the case of any assignment. The assignee, if it is not a Lender,
shall deliver to the Administrative Agent an Administrative Questionnaire.




     (v) No Assignment to Borrower. No such assignment shall be made to a Borrower
or any Borrower’s Affiliates or Subsidiaries. Notwithstanding the foregoing, assignments to
Affiliates of the Specified U.S. Borrower (other than any Subsidiaries of the Specified U.S.
Borrower) shall be permitted, provided that (a) no such assignee shall have any
right to approve or disapprove any amendment, waiver or consent hereunder or the other Loan
Documents, except that the Commitment of such assignee may not be increased or extended
without the consent of such assignee and (b) such assignee agrees in writing not to exercise
any of the rights afforded to a Lender pursuant to Section 11.01, except solely to
the extent relating to a Lender’s right to consent to extensions or increases in the
Commitment of such Lender pursuant to Section 11.01(a) (any such assignee being
referred to herein as an “Affiliated Lender”).




     (vi) No Assignment to Natural Persons. No such assignment shall be made to a
natural person.


Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c)
of this Section, from and after the effective date specified in each Assignment and Assumption, the
assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations
under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be
entitled to the benefits of Sections 3.01,






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3.04, 3.05 and 11.04 with respect to facts and circumstances occurring
prior to the effective date of such assignment. Upon request, the applicable Borrower (at its
expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with this subsection
shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with Section 11.06(d).




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




          (d) Participations. Any Lender may at any time, without the consent of, or notice to,
any Borrower or the Administrative Agent, sell participations to any Person (other than a natural
person or any Borrower or any Borrower’s Affiliates or Subsidiaries) (each, a
“Participant”) in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of its Commitment and/or the Loans (including such Lender’s
participations in L/C Obligations and/or Swing Line Loans) owing to it); provided that (i)
such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of such obligations and
(iii) the Borrowers, the Administrative Agent, the Lenders and the L/C Issuers shall continue to
deal solely and directly with such Lender in connection with such Lender’s rights and obligations
under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to enforce this Agreement
and to approve any amendment, modification or waiver of any provision of this Agreement;
provided that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, waiver or other modification described in
the first proviso to Section 11.01 that affects such Participant. Subject to
subsection (e) of this Section, each Borrower agrees that each Participant shall be
entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same extent
as if it were a Lender and had acquired its interest by assignment pursuant to Section
11.06(b). To the extent permitted by law, each Participant also shall be entitled to the
benefits of Section 11.08 as though it were a Lender, provided such Participant
agrees to be subject to Section 2.13 as though it were a Lender. Each Lender having sold a
participation in any of its obligations under this Agreement, acting solely for this purpose as an
agent of the Borrowers, shall establish and maintain at its address referred to in Section
11.02 (or at such other address as such Lender shall notify the Borrowers) a record of
ownership, in which such Lender shall register by book entry (A) the name and address of each such
participant (and each change thereto, whether by assignment or otherwise) and (B) the rights,
interests or obligations of each such participant in any obligation under this Agreement, in any
Commitment and in any right to receive any payment hereunder.




          (e) Limitations upon Participant Rights. A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04 than the applicable Lender
would have been entitled to receive with respect to the participation sold to such Participant,
unless the applicable Borrower gives its prior written consent to such entitlement in connection
with the sale of the participation to such Participant. A Participant shall not be entitled to the
benefits of Section 3.01 unless the applicable






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Borrower is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of such Borrower, to comply with Section 3.01(e) as though it were
a Lender.




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




          (g) Resignation as L/C Issuer or Swing Line Lender after Assignment. Notwithstanding
anything to the contrary contained herein, if at any time Bank of America assigns all of its
Revolving Credit Commitment and Revolving Credit Loans pursuant to Section 11.06(b), Bank
of America (and/or Bank of America-Canada Branch, as applicable) may, (i) upon 30 days’ notice to
the Borrowers and the Lenders, resign as U.S. L/C Issuer and Canadian L/C Issuer and/or (ii) upon
30 days’ notice to the Borrowers, resign as U.S. Swing Line Lender and Canadian Swing Line Lender.
In the event of any such resignation as L/C Issuer or Swing Line Lender, the Borrower Agent shall
be entitled to appoint from among the Lenders a successor L/C Issuer or Swing Line Lender
hereunder; provided, however, that no failure by the Borrower Agent to appoint any
such successor shall affect the resignation of Bank of America (and/or Bank of America-Canada
Branch, as applicable) as L/C Issuer or Swing Line Lender, as the case may be. If Bank of America
(and/or Bank of America-Canada Branch, as applicable) resigns as L/C Issuer, it shall retain all
the rights, powers, privileges and duties of an L/C Issuer hereunder with respect to all Letters of
Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C
Obligations with respect thereto (including the right to require the Lenders to make Base Rate
Loans, Canadian Base Rate Loans or Canadian Prime Rate Loans, as applicable, or fund risk
participations in Unreimbursed Amounts pursuant to Section 2.03(b)). If Bank of America
(and/or Bank of America-Canada Branch, as applicable) resigns as Swing Line Lender, it shall retain
all the rights of a Swing Line Lender provided for hereunder with respect to Swing Line Loans made
by it and outstanding as of the effective date of such resignation, including the right to require
the Lenders to make Base Rate Loans, Canadian Base Rate Loans or Canadian Prime Rate Loans, as
applicable, or fund risk participations in outstanding Swing Line Loans pursuant to Section
2.04. Upon the appointment of a successor L/C Issuer and/or Swing Line Lender, (a) such
successor shall succeed to and become vested with all of the rights, powers, privileges and duties
of the retiring L/C Issuer or Swing Line Lender, as the case may be, and (b) the successor L/C
Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding
at the time of such succession or make other arrangements satisfactory to Bank of America to
effectively assume the obligations of Bank of America (and/or Bank of America-Canada Branch, as
applicable) with respect to such Letters of Credit.




          11.07 Treatment of Certain Information; Confidentiality. Each of the Administrative
Agent, the Collateral Agents, the Lenders and the L/C Issuers agrees to maintain the
confidentiality of the Information (as defined below), except that Information may be disclosed (a)
to its partners, directors, officers, employees, agents, advisors and representatives (it being
understood that the Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information confidential), (b) to its
Affiliates and to its Affiliates’ partners, directors, officers, employees, agents, advisors and
representatives (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information
confidential) in connection with the transactions contemplated hereby or otherwise with the consent
of the Borrower Agent, (c) to the extent requested by any regulatory authority purporting to have
jurisdiction over it (including any self-regulatory authority, such as the National Association of
Insurance Commissioners), (d) to the extent required by Laws or regulations or by any subpoena or
similar legal process (provided that, to the extent permitted thereby and practicable,
prompt written notice of such disclosure will be provided to the Specified U.S. Borrower), (e) to
any other party hereto, (f) in






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connection with the exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder, (g) subject to an agreement containing provisions substantially the
same as those of this Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this Agreement, (ii) any
actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating
to any Borrower and its obligations or (iii) any of its Affiliates that is an actual or prospective
provider of cash management services to any Borrower or any Borrower’s Subsidiaries (including with
respect to treasury, depository, overdraft, credit and debit card, electronic funds transfer and
other cash management arrangements), (h) with the consent of the applicable Borrower or (i) to the
extent such Information (i) becomes publicly available other than as a result of a breach of this
Section or (ii) becomes available to the Administrative Agent, any Collateral Agent, any Lender,
any L/C Issuer or any of their respective Affiliates on a nonconfidential basis from a source other
than a Borrower or a Person known by the Administrative Agent, such Collateral Agent, such Lender,
such L/C Issuer or any of their respective Affiliates to be bound by a confidentiality agreement
with a Borrower. In addition, the Administrative Agent, each Collateral Agent, each Bookrunner and
each Lender may disclose the existence of this Agreement and the information about this Agreement
to market data collectors, similar service providers to the lending industry, and service providers
in connection with the administration and management of this Agreement and the other Loan
Documents.




          For purposes of this Section, “Information” means all information received from any
Loan Party or any Subsidiary thereof relating to any Loan Party or any Subsidiary thereof or their
respective businesses, other than any such information that is available to the Administrative
Agent, any Collateral Agent, any Lender or any L/C Issuer on a nonconfidential basis prior to
disclosure by any Loan Party or any Subsidiary thereof (other than as a result of a breach of this
Section 11.07). Any Person required to maintain the confidentiality of Information as
provided in this Section shall be considered to have complied with its obligation to do so if such
Person has exercised the same degree of care to maintain the confidentiality of such Information as
such Person would accord to its own confidential information.




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




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






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promptly after any such setoff and application, provided that the failure to give such
notice shall not affect the validity of such setoff and application. No Lender shall set off
against any Dominion Account without the prior consent of Administrative Agent.




          11.09 Interest Rate Limitation. Notwithstanding anything to the contrary contained in
any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed
the maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”).
If the Administrative Agent or any Lender shall receive interest in an amount that exceeds the
Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds
such unpaid principal, refunded to the applicable Borrowers. In determining whether the interest
contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum
Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that
is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or
unequal parts the total amount of interest throughout the contemplated term of the Obligations
hereunder. Without limiting the generality of the foregoing, if any provision of any of the Loan
Documents would obligate Canadian Loan Parties to make any payment of interest with respect to the
Canadian Obligations in an amount or calculated at a rate which would be prohibited by applicable
Law or would result in the receipt of interest with respect to the Canadian Obligations at a
criminal rate (as such terms are construed under the Criminal Code (Canada)), then notwithstanding
such provision, such amount or rates shall be deemed to have been adjusted with retroactive effect
to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by law
or so result in a receipt by the applicable recipient of interest with respect to the Canadian
Obligations at a criminal rate, such adjustment to be effected, to the extent necessary, as
follows: (i) first, by reducing the amount or rates of interest required to be paid to the
applicable recipient under the Loan Documents; and (ii) thereafter, by reducing any fees,
commissions, premiums and other amounts required to be paid to the applicable recipient which would
constitute interest with respect to the Canadian Obligations for purposes of Section 347 of the
Criminal Code (Canada). Notwithstanding the foregoing, and after giving effect to all adjustments
contemplated thereby, if the applicable recipient shall have received an amount in excess of the
maximum permitted by that section of the Criminal Code (Canada), then Canadian Loan Parties shall
be entitled, by notice in writing to the Administrative Agent, to obtain reimbursement from the
applicable recipient in an amount equal to such excess, and pending such reimbursement, such amount
shall be deemed to be an amount payable by the applicable recipient to the applicable Canadian Loan
Party. Any amount or rate of interest with respect to the Canadian Obligations referred to in this
Section 11.09 shall be determined in accordance with generally accepted actuarial practices
and principles as an effective annual rate of interest over the term that any Canadian Revolving
Credit Loans to the Canadian Borrower remain outstanding on the assumption that any charges, fees
or expenses that fall within the meaning of “interest” (as defined in the Criminal Code (Canada))
shall, if they relate to a specific period of time, be prorated over that period of time and
otherwise be prorated over the period from the Closing Date to the date of payment in full of the
Canadian Obligations, and, in the event of a dispute, a certificate of a Fellow of the Canadian
Institute of Actuaries appointed by the Administrative Agent shall be conclusive, absent manifest
error, for the purposes of such determination.




          11.10 Counterparts; Integration; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a single contract.
This Agreement and the other Loan Documents, together with the provisions of the Commitment Letter
that are stated to survive the execution hereof and the Fee Letters, constitute the entire contract
among the parties relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter hereof. Except as
provided in Section 4.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative






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Agent shall have received counterparts hereof that, when taken together, bear the signatures
of each of the other parties hereto. Delivery of an executed counterpart of a signature page of
this Agreement by telecopy or in “pdf” or similar format by electronic mail shall be effective as
delivery of a manually executed counterpart of this Agreement.




          11.11 Survival of Representations and Warranties. All representations and warranties
made hereunder and in any other Loan Document or other document delivered pursuant hereto or
thereto or in connection herewith or therewith shall survive the execution and delivery hereof and
thereof. Such representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by the Administrative
Agent or any Lender or on their behalf and notwithstanding that the Administrative Agent or any
Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and
shall continue in full force and effect as long as any Loan or any other Obligation hereunder
(other than contingent Obligations in respect of unasserted indemnity claims) shall remain unpaid
or unsatisfied or any Letter of Credit shall remain outstanding.




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




          11.13 Replacement of Lenders. If any Lender requests compensation under Section
3.04 or determines that it has become unlawful to provide or maintain Eurodollar Rate Loans or
BA Rate Loans, or if a Borrower is required to indemnify or pay any additional amount to any Lender
or any Governmental Authority for the account of any Lender pursuant to Section 3.01, or if
any Lender is a Defaulting Lender or if any other circumstance exists hereunder that gives a
Borrower the right to replace a Lender as a party hereto, then the applicable Borrower may, at its
sole expense and effort, upon notice to such Lender and the Administrative Agent, require such
Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions
contained in, and consents required by, Section 11.06), all of its interests, rights and
obligations under this Agreement and the related Loan Documents (which assignee may be another
Lender, if a Lender accepts such assignment), provided that:





     (a) such Borrower shall have paid to the Administrative Agent the assignment fee
specified in Section 11.06(b);




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




     (c) in the case of any such assignment resulting from a claim for compensation under
Section 3.04 or payments required to be made pursuant to Section 3.01, such
assignment will result in a reduction in such compensation or payments thereafter; and




     (d) such assignment does not conflict with applicable Laws.



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          A Lender shall not be required to make any such assignment or delegation if, prior thereto, as
a result of a waiver by such Lender or otherwise, the circumstances entitling a Borrower to require
such assignment and delegation cease to apply.




          11.14 Governing Law; Jurisdiction; Etc.




          (a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.




          (b) SUBMISSION TO JURISDICTION. EACH BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY
AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT
OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR
RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING WILL BE HEARD
AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
IN SUCH FEDERAL COURT; PROVIDED THAT NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN
DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR ANY L/C ISSUER MAY
OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AGAINST ANY BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY LAW.




          (c) WAIVER OF VENUE. EACH BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF
THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION
OR PROCEEDING IN ANY SUCH COURT.




          (d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS
IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.02. NOTHING IN THIS AGREEMENT WILL AFFECT
THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.




          11.15 Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY
OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT






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NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION.




          11.16 No Advisory or Fiduciary Responsibility. In connection with all aspects of each
transaction contemplated hereby (including in connection with any amendment, waiver or other
modification hereof or of any other Loan Document), each Borrower and each other Loan Party
acknowledges and agrees, and acknowledges its Affiliates’ understanding, that: (i) (A) the
arranging and other services regarding this Agreement provided by the Administrative Agent and the
Bookrunners are arm’s-length commercial transactions between the Borrowers, the other Loan Parties
and their respective Affiliates, on the one hand, and the Administrative Agent and the Bookrunners
on the other hand, (B) each Borrower and each other Loan Party has consulted its own legal,
accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) each
Borrower and each other Loan Party is capable of evaluating, and understands and accepts, the
terms, risks and conditions of the transactions contemplated hereby and by the other Loan
Documents; (ii) (A) the Administrative Agent and each Bookrunner is and has been acting solely as a
principal and, except as expressly agreed in writing by the relevant parties, has not been, is not,
and will not be acting as an advisor, agent or fiduciary for any Borrower, any other Loan Party or
any of their respective Affiliates, or any other Person and (B) neither the Administrative Agent,
nor any Bookrunner, has any obligation to any Borrower, any other Loan Party or any of their
respective Affiliates with respect to the transactions contemplated hereby except those obligations
expressly set forth herein and in the other Loan Documents; and (iii) the Administrative Agent and
the Bookrunners and their respective Affiliates may be engaged in a broad range of transactions
that involve interests that differ from those of the Borrowers, the other Loan Parties and their
respective Affiliates, and neither the Administrative Agent nor any Bookrunner has any obligation
to disclose any of such interests to any Borrower, any other Loan Party or any of their respective
Affiliates. To the fullest extent permitted by law, each Borrower and each other Loan Party hereby
waives and releases any claims that it may have against the Administrative Agent and the
Bookrunners with respect to any breach or alleged breach of agency or fiduciary duty in connection
with any aspect of any transaction contemplated hereby.




          11.17 Electronic Execution of Assignments and Certain Other Documents. The words
“execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption or in
any amendment or other modification hereof (including waivers and consents) shall be deemed to
include electronic signatures or the keeping of records in electronic form, each of which shall be
of the same legal effect, validity or enforceability as a manually executed signature or the use of
a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any
applicable law, including the Federal Electronic Signatures in Global and National Commerce Act,
the New York State Electronic Signatures and Records Act, or any other similar state laws based on
the Uniform Electronic Transactions Act..




          11.18 USA PATRIOT Act Notice. Each Lender that is subject to the Act (as hereinafter
defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies
the Loan Parties that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify
and record information that identifies each Loan Party, which information includes the name and
address of each Loan Party and other information that will allow such Lender or the Administrative
Agent, as applicable, to identify each Loan Party in accordance with the Act. Each Borrower shall,
promptly following a request by the Administrative Agent or any Lender, provide all documentation
and other information that






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the Administrative Agent or such Lender requests in order to comply with its ongoing
obligations under applicable “know your customer” an anti-money laundering rules and regulations,
including the Act.




          11.19 Judgment Currency. If for the purpose of obtaining judgment in any court it is
necessary to convert an amount due hereunder in the currency in which it is due (the “Original
Currency”) into another currency (the “Second Currency”), the rate of exchange applied
shall be that at which, in accordance with normal banking procedures, the Administrative Agent
could purchase in the New York foreign exchange market, the Original Currency with the Second
Currency on the date two (2) Business Days preceding that on which judgment is given. Each Loan
Party agrees that its obligation in respect of any Original Currency due from it hereunder shall,
notwithstanding any judgment or payment in such other currency, be discharged only to the extent
that, on the Business Day following the date the Administrative Agent receives payment of any sum
so adjudged to be due hereunder in the Second Currency, the Administrative Agent may, in accordance
with normal banking procedures, purchase, in the New York foreign exchange market, the Original
Currency with the amount of the Second Currency so paid; and if the amount of the Original Currency
so purchased or could have been so purchased is less than the amount originally due in the Original
Currency, each Loan Party agrees as a separate obligation and notwithstanding any such payment or
judgment to indemnify the Administrative Agent and the Appropriate Lenders against such loss. The
term “rate of exchange” in this Section 11.19 means the spot rate at which the Administrative
Agent, in accordance with normal practices, is able on the relevant date to purchase the Original
Currency with the Second Currency, and includes any premium and costs of exchange payable in
connection with such purchase.




          11.20 Language. The parties have requested that this Agreement and the other
documents contemplated hereby or relating hereto be drawn up in the English language. Les parties
ont requis que cette convention ainsi que tous les documents qui y sont envisagés ou qui s’y
rapportent soient rédigés en langue anglaise.




          11.21 Intercreditor Agreement. Reference is made to the Lien Subordination and
Intercreditor Agreement dated as of December 17, 2009, among Bank of America, as collateral agent
thereunder for the Revolving Facility Secured Parties referred to therein; U.S. Bank National
Association, as Trustee and as Noteholder Collateral Agent; Nortek, Inc.; and the other
subsidiaries of Nortek, Inc. named therein. Each Lender hereunder (a) consents to the subordination
of Liens provided for in the Intercreditor Agreement, (b) agrees that it will be bound by and will
take no actions contrary to the provisions of the Intercreditor Agreement and (c) authorizes and
instructs the Administrative Agent, to enter into the Intercreditor Agreement as the “collateral
agent” thereunder on behalf of such Lender. The foregoing provisions are intended as an inducement
to the Lenders under the Credit Agreement to extend credit and such Lenders are intended third
party beneficiaries of such provisions and the provisions of the Intercreditor Agreement.




[Remainder of Page Intentionally Blank]










167









 








          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of
the date first above written.




	 	 	 	 	 
	 	NORTEK, INC. , as the Specified U.S. Borrower

 	 
	 	By:  	/s/ Edward J. Cooney
 	 
	 	 	Name:  	Edward J. Cooney 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 
	 
	 	VENTROL AIR HANDLING SYSTEMS INC.,

AS THE CANADIAN BORROWER

 	 
	 	By:  	/s/ Edward J. Cooney
 	 
	 	 	Name:  	Edward J. Cooney 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 



[Signature Page to Credit Agreement]




 









 








	 	 	 	 	 
	 	AIGIS MECHTRONICS, INC.

BROAN-MEXICO HOLDINGS, INC.

BROAN-NUTONE LLC

BROAN-NUTONE STORAGE SOLUTIONS LP

CES GROUP, INC.

CES INTERNATIONAL LTD.

CLEANPAK INTERNATIONAL, INC.

ELAN HOME SYSTEMS, L.L.C.

GATES THAT OPEN, LLC

GEFEN, LLC

GOVERNAIR CORPORATION

HC INSTALLATIONS, INC.

HOMELOGIC LLC

HUNTAIR, INC.

INTERNATIONAL ELECTRONICS, INC.

LINEAR LLC

LITE TOUCH, INC.

MAGENTA RESEARCH LTD.

MAMMOTH-WEBCO, INC.

NILES AUDIO CORPORATION

NORDYNE LLC

NORDYNE INTERNATIONAL, INC.

NORTEK INTERNATIONAL, INC.

NUTONE LLC

OMNIMOUNT SYSTEMS, INC.

OPERATOR SPECIALTY COMPANY, INC.

PACIFIC ZEPHYR RANGE HOOD, INC.

PANAMAX LLC

RANGAIRE GP, INC.

RANGAIRE LP, INC.

SECURE WIRELESS, INC.

SPEAKERCRAFT, ;;C

TEMTROL, INC.

XANTECH LLC

ZEPHYR VENTILATION, LLC, as borrowers

 	 
	 	By:  	/s/ Edward J. Cooney
 	 
	 	 	Name:  	Edward J. Cooney 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 
	 	(of entity listed or as an officer of the

managing member, sole member or general partner)

 	 
	 	 	 
	 	 	 
	 	 	 
	 



[Signature Page to Credit Agreement]





 











 





	 	 	 	 	 
	 	BANK OF AMERICA, N.A., AS





ADMINISTRATIVE AGENT

 	 
	 	By:  	/s/ Robert Anchundia
 	 
	 	 	Name:  	Robert Anchundia 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	BANK OF AMERICA, N.A.,

as Collateral Agent

 	 
	 	By:  	/s/ Robert Anchundia
 	 
	 	 	Name:  	Robert Anchundia 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	GENERAL ELECTRIC CAPITAL CORPORATION,

As Collateral Agent

 	 
	 	By:  	/s/ Philip F. Carfora
 	 
	 	 	Name:  	Philip F. Carfora 	 
	 	 	Title:  	Duly Authorized Signatory 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	WELLS FARGO FOOTHILL, LLC,,

As Collateral Agent

 	 
	 	By:  	/s/ Ilene Silberman
 	 
	 	 	Name:  	Ilene Silberman 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	BANK OF AMERICA, N.A.,

as U.S. Revolving Credit Lender

 	 
	 	By:  	/s/ Robert Anchundia
 	 
	 	 	Name:  	Robert Anchundia 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	GENERAL ELECTRIC CAPITAL CORPORATION,

As a U.S. Revolving Credit Lender

 	 
	 	By:  	/s/ Philip F. Carfora
 	 
	 	 	Name:  	Philip F. Carfora 	 
	 	 	Title:  	Duly Authorized Signatory 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	WELLS FARGO FOOTHILL, LLC,,

As a U.S. Revolving Credit Lender

 	 
	 	By:  	/s/ Ilene Silberman
 	 
	 	 	Name:  	Ilene Silberman 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION

As a U.S. Revolving Credit Lender

 	 
	 	By:  	/s/ David Weaver
 	 
	 	 	Name:  	David Weaver 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	BANK OF AMERICA, N.A., (acting through its Canada

branch), as a Canadian Revolving Credit Lender

 	 
	 	By:  	/s/ Robert Anchundia
 	 
	 	 	Name:  	Robert Anchundia 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	GENERAL ELECTRIC CAPITAL CORPORATION,

As a Canadian Revolving Credit Lender

 	 
	 	By:  	/s/ Philip F. Carfora
 	 
	 	 	Name:  	Philip F. Carfora 	 
	 	 	Title:  	Duly Authorized Signatory 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	WELLS FARGO FOOTHILL, LLC,,

As a Canadian Revolving Credit Lender

 	 
	 	By:  	/s/ Sanat Amladi
 	 
	 	 	Name:  	Sanat Amladi 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	BANK OF AMERICA, N.A.,

As a U.S. L/C Issuer and U.S. Swing Line Lender

 	 
	 	By:  	/s/ Robert Anchundia
 	 
	 	 	Name:  	Robert Anchundia 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]







 









 








	 	 	 	 	 
	 	BANK OF AMERICA, N.A., (acting through its Canada

Branch), as a Canadian L/C Issuer and Canadian Swing

Line Lender

 	 
	 	By:  	/s/ Robert Anchundia
 	 
	 	 	Name:  	Robert Anchundia 	 
	 	 	Title:  	Vice President 	 
	 



[Signature Page to Credit Agreement]





 












 





Schedule 1.01




Existing Letters of Credit



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	OBLIGOR	 	ISSUER	 	LC TYPE	 	AUTO
RENEWAL	 	LC NUMBER	 	LC AMOUNT	 	 	ORIGINAL
ISSUE DATE	 	EXPIRATION
DATE
	Speakercraft, LLC
	 	Bank of America	 	Standby	 	—	 	64136126	 	$	255,000.00	 	 	5/1/2004	 	12/31/2009
	Nortek, Inc.
	 	Bank of America	 	Standby	 	YES	 	64136127	 	$	1,250,000.00	 	 	1/15/2004	 	1/15/2010
	Nortek, Inc.
	 	Bank of America	 	Standby	 	YES	 	64136123	 	$	13,590,416.00	 	 	4/24/2003	 	3/31/2010
	Nordyne LLC
	 	Bank of America	 	Standby	 	YES	 	64136124	 	$	2,500,000.00	 	 	6/10/2004	 	6/10/2010
	Linear HK Mfg.
	 	Bank of America	 	Standby	 	—	 	68008861	 	$	250,000.00	 	 	10/25/2005	 	7/1/2010
	Nordyne LLC
	 	Bank of America	 	Standby	 	YES	 	64136128	 	$	130,000.00	 	 	7/7/2004	 	7/2/2010
	Nordyne LLC
	 	Bank of America	 	Standby	 	YES	 	68013719	 	$	1,309,040.00	 	 	7/14/2006	 	7/15/2010
	Nordyne LLC
	 	Bank of America	 	Standby	 	YES	 	68044781	 	$	320,000.00	 	 	6/11/2009	 	6/11/2010
	NORDYNE International, Inc.
	 	Bank of America	 	Documentary	 	—	 	1174434	 	$	53,007.00	 	 	10/16/2009	 	12/28/2009
	Venmar CES
	 	Bank of America	 	Standby	 	YES	 	64136081	 	$	656,297.42	1	 	10/31/2003	 	4/7/2010








 




			
	1	 	CDN




 









 










Schedule 2.01




Commitments and Applicable Percentages2



	 	 	 	 	 	 	 	 	 
	 	 	U.S. Revolving Credit	 	 	U.S. Revolving Credit	 
	Lender	 	Commitment	 	 	Applicable Percentage	 
	Bank of America, N.A.
	 	$	69,000,000	 	 	 	30	%
	GE Capital
	 	$	69,000,000	 	 	 	30	%
	Wells Fargo Foothills
	 	$	69,000,000	 	 	 	30	%
	PNC Bank
	 	$	23,000,000	 	 	 	10	%
	 
	 	 	 	 	 	 	 	 
	Total
	 	$	230,000,000.00	 	 	 	100.000000000	%






	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Canadian Revolving	 
	 	 	 	 	 	 	Credit	 
	 	 	Canadian Revolving	 	 	Applicable	 
	Lender	 	Credit Commitment	 	 	Percentage	 
	Bank of America, N.A. (acting through its Canada branch)
	 	$	8,000,000	 	 	 	40	%
	GE Capital
	 	$	6,000,000	 	 	 	30	%
	Wells Fargo Foothills
	 	$	6,000,000	 	 	 	30	%
	 
	 	 	 	 	 	 	 	 
	Total
	 	$	20,000,000.00	 	 	 	100.000000000	%








 




			
	2	 	Lenders have control of this schedule and
will confirm final commitment amounts and percentages.




 









 










Schedule 4.01(a)(vi)




Properties to be Mortgaged



Broan-NuTone LLC




926 West State Street

Hartford, WI 53027

Washington County




1140 Madison Drive

Hartford, WI 53027

Washington County




Broan-NuTone Storage Solutions LP




501 S. Wilhite

Cleburne, TX 76031

Johnson County




Gates That Open, LLC




3121 Hartsfield Road

Tallahassee, FL 32303

Leon County




Governair Corporation




4700, 4821, 4840 and 4841 N. Sewell Ave.

Oklahoma City, OK 73118

Oklahoma County




Nordyne LLC




448 Richard Boulevard

Tipton, MO 65081

Moniteau County




2501 Boonslick Drive

Boonville, MO 65233

Cooper County




Temtrol, Inc.




115 East Oklahoma Avenue

Okarche, OK 73762

Kingfisher County




 









 





Schedule 5.06




Litigation



None.






 









 








Schedule 5.08(b)




Owned Real Property



Broan-NuTone LLC




926 West State Street

Hartford, WI 53027

Washington County



926 West State Street

(warehouse)

Hartford, WI 53027

Washington County




850 and 855 Madison Drive

Hartford, WI 53027

Washington County




1140 Madison Drive

Hartford, WI 53027

Washington County




Broan-NuTone Storage Solutions LP




501 S. Wilhite

Cleburne, TX 76031

Johnson County




Gates That Open, LLC




3121 Hartsfield Road

Tallahassee, FL 32303

Leon County




Governair Corporation




4700 N. Sewell

Oklahoma City, OK 73118

Oklahoma County




4821 N. Sewell

Oklahoma City, OK 73118

Oklahoma County




4840 N. Sewell

Oklahoma City, OK 73118

Oklahoma County




4841 N. Sewell

Oklahoma City, OK 73118

Oklahoma County




50 N.W. 50th Street

Oklahoma City, OK 73118

Oklahoma County




 









 





Nordyne LLC




448 Richard Boulevard

Tipton, MO 65081

Moniteau County




1620 Mid-American Industrial Court

Boonville, MO 65233

Cooper County




2501 Boonslick Drive

Boonville, MO 65233

Cooper County




4501 Gustine Avenue

St. Louis, MO 63116

Saint Louis County

(Part owned and part leased)




Nortek, Inc.




Bay Road

Fall River, MA

Bristol County



Globe Mills Avenue

Fall River, MA

Bristol County




Temtrol, Inc.




115 East Oklahoma Avenue

Okarche, OK 73762

Kingfisher County





 











 





Schedule 5.08(c)(i)




Leased Material Real Estate



	 	 	 
	LESSEE and ADDRESS	 	LESSOR
	Aigis
Mechtronics, Inc.
	 	 
	 
	 	 
	1124 Louise Road

	 	Pentad Holdings, LLC
	Winston-Salem, NC
	 	 
	Forsyth County
	 	 
	 
	 	 
	Broan-NuTone LLC
	 	 
	 
	 	 
	Steelcraft Building

	 	KCL LLC
	1353 Wacker Drive
	 	 
	Hartford, WI 53027
	 	 
	Washington County
	 	 
	 
	 	 
	CES Group, Inc.
	 	 
	 
	 	 
	13200 Pioneer Trail, Suite 150

	 	United Properties Investment LLC
	Eden Prairie, MN 55347
	 	 
	Hennepin County
	 	 
	 
	 	 
	Elan Home Systems, L.L.C.
	 	 
	1300 New Circle Road

	 	DA Lexington LLC
	Lexington, KY 40505
	 	 
	Fayette County
	 	 
	 
	 	 
	100 Hoods Lane

	 	Lime Street Realty
	Marblehead, MA

	 	Limited Partnership
	Essex County
	 	 
	 
	 	 
	1822 Bickford Avenue

	 	Snohomish Business Park, LLC
	Snohomish, WA 98290
	 	 
	Snohomish County
	 	 
	 
	 	 
	Gefen, LLC
	 	 
	 
	 	 
	20600 Nordhoff Street

	 	George D. DiRado, as
	Chatsworth (Los Angeles), CA 91311

	 	Trustee of the Husband’s Trust
	Los Angeles County

	 	Created Under the George D.
	 

	 	DiRado and Joseph H. DiRado
	 

	 	Inter Vivos Trust Agreement dated
	 

	 	June 21, 1989, as Amended and
	 

	 	Fully Restated on January 22, 2004






 









 






	 	 	 
	LESSEE and ADDRESS	 	LESSOR
	Huntair, Inc.
	 	 
	 
	 	 
	11555 S.W. Myslony Street

	 	HUNTAIR Properties LLC
	Tualatin, OR 97062
	 	 
	Washington County
	 	 
	 
	 	 
	12241 S.W. Myslony Street

	 	Tualatin Sleep LLC
	Tualatin, OR (Weld shop) 97062
	 	 
	Washington County
	 	 
	 
	 	 
	Innergy Tech Inc.
	 	 
	 
	 	 
	605 Rocheleau Street

	 	Placement Lambert Inc.
	Drummondville, Quebec,
	 	 
	Canada
	 	 
	 
	 	 
	Linear LLC
	 	 
	 
	 	 
	1950 Camino Vida Roble

	 	Arden Realty Finance III, LLC
	Suite 150
	 	 
	San Diego County
	 	 
	Carlsbad, CA 92008
	 	 
	San Diego County
	 	 
	 
	 	 
	2850 Pioneer Avenue

	 	Property Reserve, Inc.
	Suites A, B, C, D, and E
	 	 
	Vista, CA 92081
	 	 
	San Diego County
	 	 
	 
	2850 Pioneer Avenue

	 	Property Reserve, Inc.
	Suite F
	 	 
	Vista, CA 92081
	 	 
	San Diego County
	 	 
	 
	 	 
	315 Marymeade Drive

	 	CK-Belk Charleston,
	Summerville, SC 29483
	 	 
	Dorchester County
	 	 
	 
	 	 
	926 Springdale Drive

	 	Valley Investment
	Exton, PA 19341

	 	Group VIII Partnership
	Crester County
	 	 
	 
	 	 
	Lite Touch, Inc.
	 	 
	 
	 	 
	3400 S. West Temple

	 	Don L. Buehner
	Salt Lake City, UT 84115

	 	d/b/a DB Finance
	Salt Lake County
	 	 
	 
	 	 
	Magenta Research Ltd.
	 	 
	 
	 	 
	128 Litchfield Road

	 	Landover Properties
	New Milford, CT 06776
	 	 
	Litchfield County
	 	 






 









 






	 	 	 
	LESSEE and ADDRESS	 	LESSOR
	Mammoth-Webco, Inc.
	 	 
	 
	 	 
	4433 Holland Avenue

	 	Polly Properties, L.L.C.
	Holland, MI 49422
	 	 
	Ottawa County
	 	 
	 
	 	 
	3300 East Pythian

	 	CP 3300 Pythian, LLC
	Springfield, MO 65802
	 	 
	Greene County
	 	 
	 
	 	 
	Niles Audio Corporation
	 	 
	 
	 	 
	130th S.W. 128th Street

	 	Kendall Commercial Center
	Miami, FL 33186
	 	 
	Miami-Dade County
	 	 
	(locations 12305, 12319, 12323, 12325,
	 	 
	12327, 12331, 12333, 12335, 12337, 12339,
	 	 
	12341, 12343, 12345, 12269 and 12277)
	 	 
	 
	 	 
	Nordyne LLC
	 	 
	 
	 	 
	8000 Phoenix Parkway

	 	McEagle Phoenix, L.C.
	O’Fallon, MO 63366
	 	 
	Saint Charles County
	 	 
	 
	 	 
	3040 Cravens Road

	 	Poplar Bluff Industries, Inc.
	Poplar Bluff, MO 63901
	 	 
	Butler County
	 	 
	 
	 	 
	1747 Cravens Road

	 	Poplar Bluff Industries, Inc.
	Poplar Bluff, MO 63901
	 	 
	Butler County
	 	 
	 
	 	 
	2800 Hoff Road

	 	IDB of Dyer County
	Dyersburg, TN 38024
	 	 
	Dyer County
	 	 
	 
	 	 
	4501 Gustine Avenue

	 	Milton Jones
	St. Louis, MO 63116
	 	 
	(Service parts center)
	 	 
	Saint Louis County
	 	 
	(Part leased and owned)
	 	 
	 
	 	 
	NORDYNE International, Inc.
	 	 
	 
	 	 
	12250 N.W. 35th Street

	 	AMB Codina Beacon
	Miami, FL 33182

	 	Lakes, LLC
	Miami-Dade County
	 	 
	 
	 	 
	11500 N.W. 34th Street

	 	Henrie Realty
	Miami, FL 33178

	 	International, Inc.
	Miami-Dade County
	 	 






 









 






	 	 	 
	LESSEE and ADDRESS	 	LESSOR
	Nortek, Inc.
	 	 
	 
	 	 
	50 Kennedy Plaza

	 	Fleet Center Associates
	Providence, RI 02903
	 	 
	Providence County
	 	 
	(Corporate Headquarters)
	 	 
	 
	 	 
	OmniMount Systems, Inc.
	 	 
	 
	 	 
	8201 South 48th Street

	 	B&B Partnership
	Phoenix, AZ 85044
	 	 
	Maricopa County
	 	 
	 
	 	 
	Beverly Center

	 	Orsett/Beverly L.L.C.
	8181 S. 48th Street
	 	 
	Phoenix, AZ
	 	 
	Maricopa County
	 	 
	 
	 	 
	Operator Specialty Company, Inc.
	 	 
	 
	 	 
	97 North Main Street

	 	Robert Brooks
	Casnovia, MI 49318
	 	 
	Muskegon County
	 	 
	 
	 	 
	153 N. Main Street

	 	Trupiano-Vaughn-
	Casnovia, MI 49318

	 	Albrecht Partnership
	Muskegon County
	 	 
	 
	 	 
	19 Railroad Avenue

	 	Trupiano-Vaughn-
	Casnovia, MI 49318

	 	Albrecht Partnership
	Muskegon County
	 	 
	 
	 	 
	Pacific Zephyr Range Hood Inc.
	 	 
	 
	 	 
	370 Townsend Street

	 	The Siow Family
	San Francisco, CA 94107
	 	 
	San Francisco County
	 	 
	 
	 	 
	Panamax LLC
	 	 
	 
	 	 
	1690 Corporate Circle

	 	RNM Lakeville, LLC
	Petaluma, CA 94954
	 	 
	Sonoma County
	 	 
	 
	 	 
	Secure Wireless, Inc.
	 	 
	 
	 	 
	5817 Dryden Place

	 	Durkin — CAC Lot 24, LLC
	Carlsbad, CA 92008
	 	 
	San Diego County
	 	 






 









 






	 	 	 
	LESSEE and ADDRESS	 	LESSOR
	SpeakerCraft, LLC
	 	 
	 
	 	 
	940 Columbia Avenue

	 	Hunter Columbia 1, LLC
	Riverside, CA 92507
	 	 
	Riverside County
	 	 
	 
	 	 
	Venmar CES, Inc.
	 	 
	 
	 	 
	200, Rue Carter

	 	Divco Investment
	St. Leonard d’Aston
	 	 
	Quebec, Canada J0C 1M0
	 	 
	 
	 	 
	2525 Wentz Avenue and

	 	Joseph Eichman and
	2525B Wentz Avenue

	 	Pia Eichman and Roman
	(a.k.a 627 — 48th Street)

	 	Lenherr and Gertrud Lenherr
	Saskatoon, Saskatchewan
	 	 
	Canada S7K 2K9
	 	 
	 
	 	 
	Ventrol Air Handling Systems Inc.
	 	 
	 
	 	 
	9100, rue Du Parcours

	 	Jules Dallaire et al as
	Anjou, Quebec

	 	Trustees for Cominar
	Canada H1J 2Z1

	 	Real Estate Trust
	 
	 	 
	Xantech LLC
	 	 
	 
	 	 
	13100 Telfair Avenue

	 	KBC LLC (landlord); BEI
	Sylmar, CA 91342

	 	Sensors and Systems
	Los Angeles County

	 	Co., Inc. (sub-landlord)
	 
	 	 
	Zephyr Ventilation, LLC
	 	 
	 
	 	 
	2221 Harbor Bay Parkway

	 	Harbor Bay Parcel 13, LLC
	Alameda, CA
	 	 
	Alameda County
	 	 
	 
	 	 
	2277 Alameda Street

	 	Christopher J. Harney,
	San Francisco, CA

	 	Christina M. Harney and
	San Francisco County

	 	Thomas F. Murphy etc






 









 






Schedule 5.09




Environmental Compliance



None.





 











 





Schedule 5.13




Subsidiaries and Other Equity Investments; Loan Parties



	 	 	 	 	 
	 	 	 	 	ARTICLE XIV PERCENTAGE OF
	 	 	ARTICLE XIII JURISDICTION OF	 	OWNERSHIP INTEREST OF
	ARTICLE XII NAME	 	ORGANIZATION	 	SUBSIDIARY’S PARENT COMPANYN
	Aigis Mechtronics, Inc.


	 	Delaware
	 	100% by Linear LLC
	 
	 	 	 	 
	Best Deutschland GmbH

	 	Germany
	 	100% by Best S.p.A.
	 
	 	 	 	 
	Best France S.A.

	 	France
	 	100% by Best S.p.A.
	 
	 	 	 	 
	Best Poland S.p.zo.o

	 	Poland
	 	100% by Best S.p.A.
	 
	 	 	 	 
	Best S.p.A.

	 	Italy
	 	100% by Nortek (UK) Limited
	 
	 	 	 	 
	Broan Building Products (Huizhou) Co. Ltd.

	 	China
	 	100% by Broan-NuTone LLC
	 
	 	 	 	 
	Broan Building Products — Mexico, S. de
R.I. de C.V.

	 	Mexico
	 	99.96% by Broan-Mexico Holdings, Inc.

0.04% by Nortek International, Inc.
	 
	 	 	 	 
	Broan-Mexico Holdings, Inc.

	 	Delaware
	 	100% by Nortek, Inc.
	 
	 	 	 	 
	Broan-NuTone Canada Inc.

	 	Ontario, Canada
	 	100% by Nortek International Holdings B.V.
	 
	 	 	 	 
	Broan NuTone (HK) Limited

	 	Hong Kong
	 	100% by Broan-NuTone LLC
	 
	 	 	 	 
	Broan-NuTone LLC

	 	Delaware
	 	70% by Nortek, Inc.

	 

	 	 	 	30% by NuTone LLC
	 
	 	 	 	 
	Broan-NuTone Storage Solutions LP

	 	Delaware
	 	99% by Rangaire LP, Inc.

1% by Rangaire GP, Inc.
	 
	 	 	 	 
	CES Group, Inc.

	 	Delaware
	 	100% by Nordyne LLC
	 
	 	 	 	 
	CES International Ltd.

	 	Delaware
	 	100% by Mammoth-Webco, Inc.
	 
	 	 	 	 
	Cleanpak International, Inc.

	 	Delaware
	 	100% by CES Group, Inc.
	 
	 	 	 	 
	Eaton-Williams Exports Limited

	 	United Kingdom
	 	100% by Eaton-Williams Group Limited
	 
	 	 	 	 
	Eaton-Williams Group Limited

	 	United Kingdom
	 	100% by Eaton-Williams Limited
	 
	 	 	 	 
	Eaton-Williams Holdings Limited

	 	United Kingdom
	 	100% by Nortek (UK) Limited
	 
	 	 	 	 
	Eaton-Williams Limited

	 	United Kingdom
	 	100% by Eaton-Williams Holdings Limited
	 
	 	 	 	 





 









 






	 	 	 	 	 
	 	 	 	 	ARTICLE XIV PERCENTAGE OF
	 	 	ARTICLE XIII JURISDICTION OF	 	OWNERSHIP INTEREST OF
	ARTICLE XII NAME	 	ORGANIZATION	 	SUBSIDIARY’S PARENT COMPANYN
	Eaton-Williams (Millbank) Limited

	 	United Kingdom
	 	100% by Eaton-Williams Group Limited
	 
	 	 	 	 
	Eaton-Williams Products Limited

	 	United Kingdom
	 	100% by Eaton-Williams Group Limited
	 
	 	 	 	 
	Eaton-Williams Service Limited

	 	United Kingdom
	 	100% by Eaton-Williams Group Limited
	 
	 	 	 	 
	Edenaire Limited

	 	United Kingdom
	 	100% by Eaton-Williams Group Limited
	 
	 	 	 	 
	Elan Home Systems, L.L.C.

	 	Kentucky
	 	100% by Linear LLC
	 
	 	 	 	 
	Fidelity Investment Co.

	 	Rhode Island
	 	100% by Nortek, Inc.
	 
	 	 	 	 
	Gates That Open, LLC

	 	Florida
	 	100% by Linear LLC
	 
	 	 	 	 
	Gefen, LLC

	 	California
	 	100% by Linear LLC
	 
	 	 	 	 
	Governair Corporation

	 	Oklahoma
	 	100% by CES Group, Inc.
	 
	 	 	 	 
	HC Installations, Inc.

	 	Delaware
	 	100% by Huntair, Inc.
	 
	 	 	 	 
	Home Touch Lighting Systems, LLC

	 	Utah
	 	100% by Lite Touch, Inc.
	 
	 	 	 	 
	Huntair, Inc.

	 	Delaware
	 	100% by CES Group, Inc.
	 
	 	 	 	 
	Imerge Limited

	 	United Kingdom
	 	100% by Nortek (UK) Limited
	 
	 	 	 	 
	Innergy Tech Inc.

	 	Quebec, Canada
	 	100% by Venmar Ventilation Inc.
	 
	 	 	 	 
	International Electronics, LLC

	 	Massachusetts
	 	100% by Linear LLC
	 
	 	 	 	 
	Linear Canada Holdings, Inc.

	 	Delaware
	 	100% by Linear LLC
	 
	 	 	 	 
	Linear Electronics of Canada, Ltd.

	 	Canada
	 	100% by Linear Canada Holdings, Inc.
	 
	 	 	 	 
	Linear H.K. LLC

	 	Delaware
	 	100% by Nortek (UK) Limited
	 
	 	 	 	 
	Linear H.K. Manufacturing Limited

	 	Hong Kong
	 	1% by Linear H.K. LLC

99% by Nortek Holding B.V.
	 
	 	 	 	 
	Linear LLC

	 	California
	 	100% by Nortek, Inc.
	 
	 	 	 	 
	Lite Touch, Inc.

	 	Utah
	 	100% by Linear LLC
	 
	 	 	 	 
	Magenta Research Ltd.

	 	Connecticut
	 	100% by Linear LLC
	 
	 	 	 	 
	Mammoth-Webco, Inc.

	 	Delaware
	 	100% by CES Group, Inc.
	 
	 	 	 	 
	Miller de Mexico S.A. de R.I de C.V.

	 	Mexico
	 	99% by NORDYNE International, Inc.

1% by Nordyne LLC
	 
	 	 	 	 





 









 






	 	 	 	 	 
	 	 	 	 	ARTICLE XIV PERCENTAGE OF
	 	 	ARTICLE XIII JURISDICTION OF	 	OWNERSHIP INTEREST OF
	ARTICLE XII NAME	 	ORGANIZATION	 	SUBSIDIARY’S PARENT COMPANYN
	Niles Audio Corporation

	 	Delaware
	 	100% by Linear LLC
	 
	 	 	 	 
	Nordyne de Puerto Rico, LLC

	 	Puerto Rico
	 	100% by NORDYNE International, Inc.
	 
	 	 	 	 
	Nordyne do Brasil Distribuidora de Ar
Condicionado Ltda.

	 	Brazil
	 	99% by NORDYNE International, Inc.


1% by Nordyne LLC
	 
	 	 	 	 
	Nordyne LLC

	 	Delaware
	 	100% by Nortek, Inc.
	 
	 	 	 	 
	NORDYNE International, Inc.

	 	Delaware
	 	100% by Nordyne LLC
	 
	 	 	 	 
	Nortek Holding B.V.

	 	Netherlands
	 	100% by Nortek International Holdings B.V.
	 
	 	 	 	 
	Nortek International, Inc.

	 	Delaware
	 	72% by Nortek, Inc.

28% by Linear LLC
	 
	 	 	 	 
	Nortek International Holdings B.V.

	 	Netherlands
	 	100% by Nortek International, Inc.
	 
	 	 	 	 
	Nortek (Shanghai) Trading Co., Ltd.

	 	China
	 	100% by Nortek Trading, Ltd.
	 
	 	 	 	 
	Nortek Trading, Ltd.

	 	British Virgin Islands
	 	100% by Nortek International, Inc.
	 
	 	 	 	 
	Nortek (UK) Limited

	 	United Kingdom
	 	100% by Nortek Holding B.V.
	 
	 	 	 	 
	NuTone LLC

	 	Delaware
	 	100% by Nortek, Inc.
	 
	 	 	 	 
	OmniMount Systems, Inc.

	 	Arizona
	 	100% by Linear LLC
	 
	 	 	 	 
	Operator Specialty Company, Inc.

	 	Michigan
	 	100% by Linear LLC
	 
	 	 	 	 
	Pacific Zephyr Range Hood Inc.

	 	California
	 	100% by Broan-NuTone LLC
	 
	 	 	 	 
	Panamax LLC

	 	California
	 	100% by Linear LLC
	 
	 	 	 	 
	Precision Air Control Limited

	 	United Kingdom
	 	100% by Eaton-Williams Group Limited
	 
	 	 	 	 
	Rangaire GP, Inc.

	 	Delaware
	 	100% by Broan-NuTone LLC
	 
	 	 	 	 
	Rangaire LP, Inc.

	 	Delaware
	 	100% by Broan-NuTone LLC
	 
	 	 	 	 
	Ring Brothers Corporation

	 	California
	 	100% by Nortek, Inc.
	 
	 	 	 	 
	Secure Wireless, Inc.

	 	California
	 	100% by Linear LLC
	 
	 	 	 	 
	SpeakerCraft, LLC

	 	Delaware
	 	100% by Linear LLC
	 
	 	 	 	 
	Stilpol S.p.zo.o

	 	Poland
	 	100% by Best S.p.A.
	 
	 	 	 	 
	Temtrol, Inc.

	 	Oklahoma
	 	100% by CES Group, Inc.
	 
	 	 	 	 





 









 






	 	 	 	 	 
	 	 	 	 	ARTICLE XIV PERCENTAGE OF
	 	 	ARTICLE XIII JURISDICTION OF	 	OWNERSHIP INTEREST OF
	ARTICLE XII NAME	 	ORGANIZATION	 	SUBSIDIARY’S PARENT COMPANYN
	Vapac Humidity Control Limited

	 	United Kingdom
	 	100% by Eaton-Williams Group Limited
	 
	 	 	 	 
	Venmar CES, Inc.

	 	Saskatchewan, Canada
	 	100% by Venmar Ventilation Inc.
	 
	 	 	 	 
	Venmar Ventilation Inc.

	 	Quebec, Canada
	 	100% by Broan-NuTone Canada Inc.
	 
	 	 	 	 
	Venmar Ventilation (H.D.H.) Inc.

	 	Quebec, Canada
	 	100% by Venmar Ventilation Inc.
	 
	 	 	 	 
	Ventrol Air Handling Systems Inc.

	 	Canada
	 	100% by CES Group, Inc.
	 
	 	 	 	 
	Xantech LLC

	 	California
	 	100% by Linear LLC
	 
	 	 	 	 
	Zephyr Ventilation, LLC

	 	California
	 	100% by Broan-NuTone LLC










 









 








Schedule 5.25




Canadian Pension Plans



None.



 









 





Schedule 6.12




Guarantors



U.S. Subsidiary Guarantors





	 	1.	 	Aigis Mechtronics, Inc.
	 
	 	2.	 	Broan-Mexico Holdings, Inc.
	 
	 	3.	 	Broan-NuTone LLC
	 
	 	4.	 	Broan-NuTone Storage Solutions LP
	 
	 	5.	 	CES Group, Inc.
	 
	 	6.	 	CES International Ltd.
	 
	 	7.	 	Cleanpak International, Inc.
	 
	 	8.	 	Elan Home Systems, L.L.C.
	 
	 	9.	 	Gates That Open, LLC
	 
	 	10.	 	Gefen, LLC
	 
	 	11.	 	Governair Corporation
	 
	 	12.	 	HC Installations, Inc.
	 
	 	13.	 	Huntair, Inc.
	 
	 	14.	 	International Electronics, LLC
	 
	 	15.	 	Linear LLC
	 
	 	16.	 	Lite Touch, Inc.
	 
	 	17.	 	Magenta Research Ltd.
	 
	 	18.	 	Mammoth-Webco, Inc.
	 
	 	19.	 	Niles Audio Corporation
	 
	 	20.	 	Nordyne LLC
	 
	 	21.	 	NORDYNE International, Inc.
	 
	 	22.	 	Nortek International, Inc.
	 
	 	23.	 	NuTone LLC
	 
	 	24.	 	OmniMount Systems, Inc.
	 
	 	25.	 	Operator Specialty Company, Inc.
	 
	 	26.	 	Pacific Zephyr Range Hood Inc.
	 
	 	27.	 	Panamax LLC
	 
	 	28.	 	Rangaire GP, Inc.
	 
	 	29.	 	Rangaire LP, Inc.
	 
	 	30.	 	Secure Wireless, Inc.
	 
	 	31.	 	SpeakerCraft, LLC
	 
	 	32.	 	Temtrol, Inc.
	 
	 	33.	 	Xantech LLC
	 
	 	34.	 	Zephyr Ventilation, LLC





Canadian Subsidiary Guarantors





	 	1.	 	Broan-NuTone Canada Inc.
	 
	 	2.	 	Innergy Tech Inc.
	 
	 	3.	 	Venmar CES, Inc.
	 
	 	4.	 	Venmar Ventilation (H.D.H.) Inc.
	 
	 	5.	 	Venmar Ventilation Inc.




 









 











(Meets “Excluded Subsidiary” Test)

Non U.S. Subsidiary Guarantors





	 	1.	 	Fidelity Investment Co.
	 
	 	2.	 	Linear Canada Holdings, Inc.
	 
	 	3.	 	Home Touch Lighting Systems, LLC
	 
	 	4.	 	Ring Brothers Corporation
	 
	 	5.	 	Linear H.K. LLC
	 
	 	6.	 	Broan-Mexico Holdings, Inc.






 











 





Schedule 7.013




Existing Liens


To the extent listed under the subheading “Other Indebtedness” on Schedule 7.03, Liens on property
of Best S.p.A. and its direct subsidiaries and Stilpol s.p.zo.o securing Indebtedness of “Best
S.p.A.” and “Stilpol s.p.zo.o” under the subheading “Other Indebtedness” on Schedule 7.03.



Capital Lease with respect to the property located at 2800 Hoff Road, Dyersburg, TN 38024.



Capital Lease with respect to the property located at 1747 Cravens Road, Poplar Bluff, MO 63901.




UCC FILINGS:




	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	California SOS

	 	Advanced Bridging
Technologies, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	08-7158746450

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Advanced Bridging
Technologies, Inc.
	 	U.S. Bank National
Association
	 	08-7158748230

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Aigis Mechtronics, Inc.
	 	U.S. Bank National
Association
	 	2008 1740412

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Aigis Mechtronics, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1744026

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 








 




			
	3	 	Pursuant to and in accordance with the
provisions of paragraph 6 of that certain Payoff Letter, dated December 17,
2009, among the Specified U.S. Borrower, the Canadian Borrower, the other
Borrowers party thereto and Bank of America, N.A., the Bank of America and U.S.
Bank National Association liens related to the credit agreement and indenture
executed on May 20, 2008 will be removed from this Schedule 7.01.




 









 










	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	Allstar Pro, LLC
	 	U.S. Bank National
Association
	 	2008 1740420

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Allstar Pro, LLC
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1744042

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Aubrey Manufacturing,
Inc.
	 	Crown Credit Company
	 	63457710

10/05/2006
	 	Equipment
	Delaware SOS

	 	Aubrey Manufacturing,
Inc.
	 	U.S. Bank National
Association
	 	2008 1740446

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Aubrey Manufacturing,
Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1743994

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Broan-Mexico Holdings,
Inc.
	 	U.S. Bank National
Association
	 	2008 1740891

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Broan-Mexico Holdings,
Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1744083

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Broan-Nutone LLC
	 	U.S. Bank National
Association
	 	2008 1740479

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Broan-Nutone LLC
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1743952

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Broan-NuTone Storage

Solutions LP
	 	U.S. Bank National
Association
	 	2008 1740842

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Broan-NuTone Storage

Solutions LP
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1743853

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	CES Group, Inc.
	 	U.S. Bank National
Association
	 	2008 1739521

05/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	CES Group, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1743903

5/20/2008
	 	All assets.






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	Cleanpak
International, Inc.
	 	U.S. Bank National
Association
	 	2008 1740529

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Cleanpak
International, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1743499

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Kentucky SOS

	 	Elan Home Systems,
L.L.C.
	 	Cisco Systems Capital

Corporation
	 	2006-2154931-73

3/20/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Kentucky SOS

	 	Elan Home Systems,
L.L.C.
	 	U.S. Bank National
Association
	 	2008-2319152-83.01
5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Kentucky SOS

	 	Elan Home Systems,
L.L.C.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008-2319154-05.01
5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Gefen, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	08-7158747340

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Gefen, Inc.
	 	U.S. Bank National
Association
	 	08-7158750152

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Oklahoma (filed 

w/County Clerk)

	 	Governair Corporation
	 	Toyota Motor Credit

Corporation
	 	2005008306630

07/06/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Oklahoma (filed 

w/County Clerk)

	 	Governair Corporation
	 	Toyota Motor Credit

Corporation
	 	2006004696639

04/20/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Oklahoma (filed 

w/County Clerk)

	 	Governair Corporation
	 	Toyota Motor Credit

Corporation
	 	2006007307934

06/16/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Oklahoma (filed 

w/County Clerk)

	 	Governair Corporation
	 	Toyota Motor Credit

Corporation
	 	2007006871435

06/08/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Oklahoma (filed 

w/County Clerk)

	 	Governair Corporation
	 	U.S. Bank National
Association
	 	2008005826738

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Oklahoma (filed 

w/County Clerk)

	 	Governair Corporation
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008005827133

5/21/2008
	 	All assets.






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Florida – Dept of
State

	 	GTO Inc
	 	Marlin Leasing Corp
	 	200704854374

2/19/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Florida – Dept of
State

	 	GTO, Inc.
	 	U.S. Bank National
Association
	 	200808369626

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Florida – Dept of
State

	 	GTO, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	200808369650

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Florida Secured 

Transaction 

Registry

	 	GTO Inc
	 	US Bancorp
	 	200900164202

3/12/2009
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	HC Installations, Inc.
	 	U.S. Bank National
Association
	 	2008 1740560

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	HC Installations, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1743861

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	HomeLogic LLC
	 	U.S. Bank National
Association
	 	2008 1740586

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	HomeLogic LLC
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1743846

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Huntair, Inc.
	 	U.S. Bank National
Association
	 	2008 1740628

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Huntair, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1744133

5/20/2008
	 	All assets.






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	Huntair, Inc
	 	Expeditors
International of
Washington,
Inc4
	 	2009 3624589

11/12/2009
	 	Any and all personal property of Debtor
(including goods and documents of title
relating thereto) at any time, in the
past, now, or hereafter, in Secured
Party’s possession, custody or control,
or en route (including personal property
at any time released or otherwise made
available to the Debtor) and all
proceeds and products of any of the
forgoing in whatever form. This lien and
security interest shall be in additional
to any other rights Secured Party has or
may acquire under other agreements
and/or applicable law, and shall survive
delivery or release of any collateral.
	 
	 	 	 	 	 	 	 	 
	Massachusetts
Secretary of the
Commonwealth

	 	International
Electronics, Inc.
	 	US Bancorp
	 	200435296850

12/21/2004
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Massachusetts
Secretary of the
Commonwealth

	 	International
Electronics, Inc.
	 	U.S. Bank National
Association
	 	200865535190

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Massachusetts
Secretary of the
Commonwealth

	 	International
Electronics, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	200865739930

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Massachusetts
Secretary of the
Commonwealth

	 	International
Electronics, Inc.
	 	US Bancorp
	 	200869665550

11/19/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Massachusetts
Secretary of the
Commonwealth

	 	International
Electronics, Inc.
	 	US Bancorp
	 	200869733510

11/24/2008
	 	Equipment








 




			
	4	 	Nortek is confirming this filing will be
terminated.




 









 










	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Missouri SOS

	 	J.A.R. Industries, Inc.
	 	U.S. Bank National
Association
	 	20080057278M

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	J.A.R. Industries, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	20080059094J

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Los Angeles County, 

California

	 	Jensen Industries, Inc.
	 	Los Angeles County Tax

Collector
	 	State Tax

File #02-0537814

3/07/2002
	 	Los Angeles County Tax Collector
$288.26 for year 2001 (Account 49124059)
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Linear H.K. LLC
	 	U.S. Bank National
Association
	 	2008 1740933

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Linear H.K. LLC
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1744117

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Linear LLC
	 	US Bancorp
	 	07-7105269067

3/07/2007
	 	(Lessee/Lessor) No collateral description
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Linear LLC
	 	US Bancorp
	 	07-7112276245

5/02/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Linear LLC
	 	US Bancorp
	 	08-7142311855

1/03/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Linear LLC
	 	Bank of America, N.A.,
as Administrative
Agent
	 	08-7158747229

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Linear LLC
	 	U.S. Bank National
Association
	 	08-7158750273

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Linear Corporation
	 	General Electric

Capital Corporation
	 	08-7173530973

9/29/2008
	 	All Equipment leased to or financed for
the Debtor by Secured Party under that
certain Total Image Management Agreement
No. 7369170-007.
	 
	 	 	 	 	 	 	 	 
	Utah – Division of
Corporations and


	 	Lite Touch, Inc.
	 	Revco Leasing Company
	 	317696200705

4/13/2007
	 	Equipment 






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Commercial Code

Utah – Division of
Corporations and
Commercial Code

	 	Lite Touch, Inc.
	 	U.S. Bank National
Association
	 	344283200806

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Utah – Division of
Corporations and
Commercial Code

	 	Lite Touch, Inc.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	344348200804

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Connecticut SOS

	 	Magenta Research Ltd.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	0002635716

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Connecticut SOS

	 	Magenta Research Ltd.
	 	U.S. Bank National
Association
	 	0002635706

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Mammoth Inc
	 	IOS Capital
	 	50531724

02/09/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Mammoth, Inc.
	 	Industrial Leasing, LLC
	 	51706978

6/03/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Mammoth, Inc.
	 	U.S. Bank National
Association
	 	2008 1740180

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Mammoth China Ltd.
	 	U.S. Bank National
Association
	 	2008 1740073

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Mammoth China Ltd.
	 	Bank of America, N.A.,
as Administrative
Agent
	 	2008 1744059

5/20/2008
	 	All assets.






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	Mammoth-Webco, Inc.

	 	Bank of America, N.A., as
Administrative Agent
	 	2008 1744034

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	Mammoth-WEBCO, Inc.
	 	Dell Financial Services, L.P.
	 	20050047790F

5/06/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	Mammoth-WEBCO, Inc.
	 	Crown Credit Company
	 	20060039684K

4/11/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	Mammoth-WEBCO, Inc.

	 	Toyota Motor Credit

Corporation
	 	20060097152C

9/06/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	Mammoth-WEBCO, Inc.
	 	Crown Credit Company
	 	20070021075F

2/23/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	Mammoth-WEBCO, Inc.
	 	Crown Credit Company
	 	20070084917K

7/26/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	Mammoth-WEBCO, Inc.

	 	Toy ota Motor Credit

Corporation
	 	20080044549H

4/22/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Niles Audio 

Corporation
	 	Heartland Business Credit
	 	63378361

9/29/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Niles Audio
Corporation
	 	U.S. Bank National
Association
	 	2008 1740248

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Niles Audio 

Corporation
	 	Bank of America, N.A., as
Administrative Agent
	 	2008 1744018

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Niles Audio 

Corporation
	 	Audio Precision
	 	2009-0979275

3/27/2009
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Niles Audio 

Corporation
	 	Audio Precision
	 	2009-1374914

4/30/2009
	 	Equipment






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	Nordyne China, LLC

	 	U.S. Bank National
Association
	 	2008 1740206

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne China, LLC 


	 	Bank of America, N.A., as
Administrative Agent
	 	2008 1744000

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne, Inc.


	 	Firstar Equipment Finance, a
division of Firstar Bank,
        N.A.
	 	11011597

8/22/01
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne, Inc.

	 	General Electric Capital

Corporation
	 	52208420

7/07/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	CSI Leasing, Inc.
	 	52692698

8/30/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne, Inc.

	 	U.S . Bancorp Equipment
Finance, Inc.
	 	53007201

9/28/2005
	 	Equipment (in lieu filing to
continue 4128476 filed 01/29/2001
with the Missouri SOS).
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Commerce Bank, N.A.
	 	53072916

9/29/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Southern Missouri Bank
	 	53317444

10/25/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Commerce Bank, N.A.
	 	53343499

10/24/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.

	 	Citicapital Commercial

Leasing Corporation
	 	53496222

11/10/2005
	 	Equipment (in lieu filing to
continue File #4115733, filed
12/18/2000, with Missouri SOS).
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc 


	 	Citicapital Commercial

Leasing Corporation
	 	53835874

12/12/2005
	 	Equipment (in lieu filing to
continue File #4115724, filed
12/18/2000, with Missouri SOS).
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	CSI Leasing, Inc.
	 	54060498

12/30/2005
	 	Equipment






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	Nordyne, Inc.
	 	Tennant Financial Services
	 	60014746

12/27/2005
	 	Equipment (in lieu filing to
continue File #4148798, filed
3/28/2001, with the Missouri SOS;
File #101483, filed 3/28/2001,
with the Butler County Clerk,
Missouri).
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.

	 	U.S. Bancorp Equipment
Finance, Inc.
	 	60139006

1/06/2006
	 	Equipment (in lieu filing to
continue File #4162654, filed
05/09/2001, with the Missouri
SOS).
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Incorporated 


	 	Citicapital Commercial

Leasing Corporation
	 	61348622

4/21/2006
	 	Equipment (in lieu filing to
continue File #4161966, filed
05/04/2001, with the Missouri
SOS).
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	CSI Leasing, Inc.
	 	61799170

5/26/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	CSI Leasing, Inc.
	 	62024289

6/14/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.

	 	First American Commercial
Bancorp, Inc.
	 	63113982

9/08/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	 

	 	 



	 	Partial Assignment of
collateral to:
National City Commercial
Capital Corporation
	 	Partial Assignment

2007 0293257

1/18/2007	 	 
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Southwest Bank of St. Louis
	 	63514312

10/11/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.

	 	U.S. Bancorp Oliver-Allen
Technology Leasing
	 	63611175

10/18/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	CSI Leasing, Inc.
	 	64114336

11/27/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	CSI Leasing, Inc.
	 	64114492

11/27/2006
	 	Equipment






 









 





	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	Nordyne Inc.
	 	CSI Leasing, Inc.
	 	64114617

11/27/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	U.S. Bancorp Oliver-Allen
Technology Leasing
	 	2007 0303239

1/24/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	CSI Leasing, Inc.
	 	2007 0680933

2/22/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	U.S. Bancorp Oliver-Allen
Technology Leasing
	 	2007 2152741

6/08/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	De Lage Landen Financial
Services, Inc.
	 	2007 4133277

10/31/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	U.S. Bancorp Oliver-Allen
Technology Leasing
	 	2007 4803143

12/19/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	De Lage Landen Financial
Services, Inc.
	 	2008 0078806

1/08/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	De Lage Landen Financial
Services, Inc.
	 	2008 0589471

2/19/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	De Lage Landen Financial
Services, Inc.
	 	2008 0727592

2/28/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	U.S. Bank National
Association
	 	2008 1740271

5/20/2008
	 	All Assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Bank of America, N.A., as
Administrative Agent
	 	2008 1743986

5/20/2008
	 	All Assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Southwest Bank of St. Louis
	 	2008 1788353

5/23/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne, Inc.
	 	Southwest Bank of St. Louis
	 	2008 1901139

6/04/2008
	 	Equipment






 








 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	Nordyne Inc.
	 	Southwest Bank of St. Louis
	 	2008 2264750

7/02/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Southwest Bank of St. Louis
	 	2008 3509039

10/17/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Southwest Bank of St. Louis
	 	2008 3837000

11/17/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Southwest Bank of St. Louis
	 	2009 0646254

2/27/2009
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.
	 	Southwest Bank of St. Louis
	 	2009 0910890

3/23/2009
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne Inc.

	 	General Electric Capital

Corporation
	 	2009 2700653

8/21/2009
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Butler County, 

Missouri

	 	Nordyne Inc.
	 	 	 	 	 	Employment Discrimination Case
filed 11/6/2008 was moved to
Federal Court on 12/17/2008.
	 
	 	 	 	 	 	 	 	 
	Cooper County, 

Missouri

	 	Nordyne, Inc.

	 	U.S. Bancorp Equipment
Finance, Inc.
	 	Book 348, Page 236

2/14/2001
	 	Equipment with respect to Lease No.
12968-01.
	 
	 	 	 	 	 	 	 	 
	Cooper County, 

Missouri

	 	Nordyne, Inc.


	 	Firstar Equipment Finance, a
Division of Firstar Bank,
        N.A.
	 	Book 357, Page 119

8/13/2001
	 	Equipment with respect to Lease No.
101-0012968-003.
	 
	 	 	 	 	 	 	 	 
	 

	 	


	 	Continuation filed by:
        U.S. Bancorp Equipment
Finance, Inc
	 	Continuation

Book 497, Page 252

4/24/2006	 	 
	 
	 	 	 	 	 	 	 	 
	Cooper County, 

Missouri

	 	Nordyne Inc.
	 	Pioneer Bank & Trust Co.
	 	Book 444, Page 610

5/28/2009
	 	Fixture Filing
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nordyne
International, Inc.
	 	U.S. Bank National
Association
	 	2008 1740305

5/20/2008
	 	All assets.






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	Nordyne
International, Inc.
	 	Bank of America, N.A., as
Administrative Agent
	 	2008 1743978

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nortek
	 	IOS Capital
	 	61535921

5/06/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nortek, Inc.
	 	Key Equipment Finance Inc.
	 	2007 3592721

9/24/2007
	 	Equipment, inventory, goods,
contracts, documents of title,
investment property, chattel
paper, notes, accounts, contract
rights, general intangibles.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nortek, Inc.

	 	U.S. Bank National
Association
	 	2008 1740313

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nortek, Inc.

	 	Bank of America, N.A., as
Administrative Agent
	 	2008 1743937

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nortek
International, Inc.
	 	U.S. Bank National
Association
	 	2008 1740370

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nortek
International, Inc.
	 	Bank of America, N.A., as
Administrative Agent
	 	2008 1743911

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nutone Inc.

	 	U.S. Bank National
Association
	 	2008 1740404

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Nutone Inc.

	 	Bank of America, N.A., as
Administrative Agent
	 	2008 1743895

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Arizona SOS

	 	Omnimount Systems 

Inc
	 	Marlin Leasing Corp
	 	200714840727

6/07/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Arizona SOS

	 	Omnimount Systems,
Inc.
	 	U.S. Bank National
Association
	 	200815405020

5/20/2008
	 	All assets.






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Arizona SOS

	 	OmniMount Systems, Inc.
	 	Bank of America, N.A.*
	 	200815406849

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Arizona SOS

	 	Omnimount Systems, Inc
	 	Expeditors International
of Washington,
Inc5
	 	200915991054

11/12/2009
	 	Any and all personal property of
Debtor (including goods and
documents of title relating
thereto) at any time, in the past,
now, or hereafter, in Secured
Party’s possession, custody or
control, or en route (including
personal property at any time
released or otherwise made
available to the Debtor) and all
proceeds and products of any of
the forgoing in whatever form.
This lien and security interest
shall be in additional to any
other rights Secured Party has or
may acquire under other agreements
and/or applicable law, and shall
survive delivery or release of any
collateral.
	 
	 	 	 	 	 	 	 	 
	Michigan Dept. of
State

	 	Operator Specialty
Company, Inc.
	 	U.S. Bank National
Association
	 	2008080579-9

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Michigan Dept. of
State

	 	Operator Specialty
Company, Inc.
	 	Bank of America, N.A.,
as Administrative Agent
	 	2008080580-2

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Pacific Zephyr Range
Hood Inc.
	 	Bank of America, N.A.,
as Administrative Agent
	 	08-7158747108

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Pacific Zephyr Range
Hood Inc.
	 	U.S. Bank National
Association
	 	08-7158749746

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Panamax Inc.
	 	Bank of America, N.A.,
as Administrative Agent
	 	08-7158747087

5/20/2008
	 	All assets.








 




			
	5	 	Nortek is confirming filing will be
terminated.




 









 










	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	California SOS

	 	Panamax Inc.
	 	U.S. Bank National
Association
	 	08-7158749625

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Rangaire GP, Inc.
	 	U.S. Bank National
Association
	 	2008 1740719

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Rangaire LP, Inc.
	 	U.S. Bank National
Association
	 	2008 1740867

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Rangaire LP, Inc.
	 	Bank of America, N.A.,
as Administrative Agent
	 	2008 1743838

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	Rangaire GP, Inc.
	 	Bank of America, N.A.,
as Administrative Agent
	 	2008 1743879

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Secure Wireless, Inc.
	 	Bank of America, N.A.,
as Administrative Agent
	 	08-7158746834

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Secure Wireless, Inc.
	 	U.S. Bank National
Association
	 	08-7158749483

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	SpeakerCraft, Inc.
	 	Hawthorne Machinery Co.
	 	50218256

01/19/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	SpeakerCraft, Inc.
	 	Hawthorne Machinery Co.
	 	51020792

04/04/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	SpeakerCraft, Inc.
	 	Hawthorne Machinery Co.
	 	53958502

12/20/2005
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	SpeakerCraft, Inc.
	 	Hawthorne Machinery Co.
	 	60561662

2/15/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	SpeakerCraft, Inc.
	 	Hawthorne Machinery Co.
	 	61899335

6/05/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	SpeakerCraft
	 	Hawthorne Machinery Co.
	 	63696184

10/24/2006
	 	Equipment






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Delaware SOS

	 	SpeakerCraft
	 	Hawthorne Machinery Co.
	 	2007 3225777

8/23/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	SpeakerCraft, Inc.
	 	U.S. Bank National
Association
	 	2008 1740651

5/20/2008
	 	All Assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	SpeakerCraft, Inc.
	 	Bank of America, N.A.,
as Administration Agent
	 	2008 1743812

5/20/2008
	 	All Assets.
	 
	 	 	 	 	 	 	 	 
	Oklahoma – Oklahoma 

County Clerk

	 	Temtrol, Inc.
	 	U.S. Bank National
Association
	 	2008005826637

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Oklahoma – Oklahoma 

County Clerk

	 	Temtrol, Inc.
	 	Bank of America, N.A.,
as Administrative Agent
	 	2008005827032

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Oklahoma – Oklahoma 

County Clerk

	 	Temtrol, Inc.
	 	Toyota Motor Credit

Corporation
	 	2008005907334

5/22/2008
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	WDS LLC
	 	U.S. Bank National
Association
	 	2008 1740677

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Delaware SOS

	 	WDS LLC
	 	Bank of America, N.A.,
as Administrative Agent
	 	2008 1743655

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	Webco, Inc.
	 	U.S. Bank National
Association
	 	20080057279A

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	Webco, Inc.
	 	Bank of America, N.A.,
as Administrative Agent
	 	20080059097A

5/21/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Missouri SOS

	 	Webco, LLC
	 	Core First Bank
	 	20090070697A

7/16/2009
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Xantech Corporation
	 	Bank of America, N.A.,
as Administrative Agent
	 	08-7158746713

5/20/2008
	 	All assets.






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	California SOS

	 	Xantech Corporation
	 	U.S. Bank National
Association
	 	08-7158748856

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Zephyr Corporation
	 	Leaf Funding, Inc.
	 	0408660217

3/18/2004
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Zephyr Corporation
	 	US Bancorp
	 	06-7066312920

4/14/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Zephyr Corporation
	 	Bank of America, N.A.,
as Administrative Agent
	 	08-7158746692

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	California SOS

	 	Zephyr Corporation
	 	U.S. Bank National
Association
	 	08-7158748614

5/20/2008
	 	All assets.
	 
	 	 	 	 	 	 	 	 
	Ontario

	 	Broan-Nutone Canada
Inc.
	 	Bank of America, N.A.,
as Administrative Agent
	 	646180497

20080618 1038 8028 0043	 	 
	 
	 	 	 	 	 	 	 	 
	Saskatchewan

	 	Venmar CES, Inc.
	 	Venmar CES, Inc.
	 	300338979
	 	 
	 
	 	 	 	 	 	 	 	 
	Quebec

	 	Ventrol Air Handling
Systems Inc./Systèmes
De Traitement D’air
Ventrol Inc.
	 	Bank of America, N.A.
	 	Conventional hypothec

without delivery

08-0379802-0001	 	 
	 
	 	 	 	 	 	 	 	 
	Quebec

	 	Innergy Tech Inc.
	 	Bank of America, N.A.
	 	Conventional hypothec

without delivery

08-0379802-0002	 	 
	 
	 	 	 	 	 	 	 	 
	Quebec

	 	Venmar Ventilation Inc.
	 	Bank of America, N.A.
	 	Conventional hypothec

with delivery

08-0379802-0003	 	 
	 
	 	 	 	 	 	 	 	 
	Quebec

	 	Venmar CES, Inc.
	 	Bank of America, N.A.
	 	Conventional hypothec

without delivery

08-0379802-0004	 	 






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Quebec

	 	Venmar Ventilation
(H.D.H.) Inc.
	 	Bank of America, N.A.
	 	Conventional hypothec

without delivery

08-0379802-0005	 	 
	 
	 	 	 	 	 	 	 	 
	Ontario (PPSA)

	 	Broan-Nutone Canada
Inc.
	 	Summit Lease a Divison
of Summit Ford Sales
(1982) Limited
	 	File No.

643456368
	 	2007 Ford Mustang
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Registration No.

20080318 1706 1462 0103

Term 8 years	 	 
	 
	 	 	 	 	 	 	 	 
	Ontario (PPSA)

	 	Broan-Nutone Canada
Inc.
	 	De Lage Landen Financial
Services Canada Inc.
	 	File No.

613515825
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	20050321 1804 7029 2827

Term 6 years	 	 
	 
	 	 	 	 	 	 	 	 
	Saskatchewan (PPSA)

	 	Venmar CES, Inc.
	 	Wajax Finance Ltd.
	 	Registration No.

300116086

12/19/2006
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Saskatchewan (PPSA)

	 	Venmar CES, Inc.
	 	Dell Financial Services

Canada Limited
	 	Registration No.

300225062

9/18/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Saskatchewan (PPSA)

	 	Venmar CES, Inc.
	 	IOS Financial Services
	 	Registration No.

300502222

9/9/2009
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Saskatchewan (PPSA)

	 	Venmar CES, Inc.
	 	Pitney Bowes of Canada
Ltee
	 	Registration No.

300125789

1/22/2007
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Saskatchewan (PPSA)

	 	Venmar CES, Inc.
	 	Pitney Bowes of Canada
Ltee
	 	Registration No.

300125907

1/22/2007
	 	Equipment






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Quebec (RPMRR)

	 	Ventrol Air Handling
Systems Inc.


	 	Les Services Financiers


	 	Registration No.

03-0029518-0001

	 	Equipment
	 
	 	 	 	 	 	 	 	 
	 

	 	
Systemes de Traitement
d’Air Ventrol Inc.
	 	
Caterpillar Limitee
	 	
1/22/2003

(expires 1/13/2013)
	 	 
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Systemes de Traitement
d’Air Ventrol Inc.
	 	Citicorp Vendor Finance,
Ltd.
	 	Registration No.

05-0635550-0001

11/8/2005

(expires 11/8/2009)
	 	Movable property pursuant to a
lease agreement dated 10/25/2005.
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Ventrol Air Handling
Systems Inc.

	 	Citicorp Vendor Finance,
Ltd.

	 	Registration No.

06-0248992-0001
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	 

	 	

Systemes de Traitement
d’Air Ventrol Inc.
	 	
Citicorp Finance Vendeur
Ltee
	 	
5/5/2006

(expires 11/5/2011)
	 	 
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Systemes de Traitement
d’Air Ventrol Inc.
	 	Liftcapital Corporation
	 	Registration No.

08-0341649-0001

6/11/2008

(expires 12/31/2013)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Innergy Tech Inc.
	 	Kinecor LP
	 	Registration No.

06-0502792-0001

8/31/2006

(expires 8/30/2016)
	 	Consignment Contract for equipment.
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Innergy Tech Inc.
	 	Location Plafolift Inc.
	 	Registration No.

08-0005098-0001

1/7/2008

(expires 1/7/2017)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Innergy Tech Inc.
	 	Kinecor LP
	 	Registration No.

08-0027111-0001

1/17/2008

(expires 1/17/2018)
	 	Consignment Contract for equipment.






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Quebec (RPMRR)

	 	Innergy Tech Inc.
	 	Coroplast, Inc.
	 	Registration No.

09-0147447-0001

3/23/2009

(expires 3/22/2019)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Venmar Ventilation Inc.
	 	Xerox Canada Ltd.
	 	Registration No.

06-0174119-0022

4/4/2006

(expires 3/30/2011)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Venmar Ventilation Inc.
	 	Xerox Canada Ltd.
	 	Registration No.

06-0731287-0020

12/20/2006

(expires 12/20/2012)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Venmar Ventilation Inc.
	 	Xerox Canada Ltd.
	 	Registration No.

07-0230142-0004

4/30/2007

(expires 4/28/2011)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Venmar Ventilation Inc.
	 	Xerox Canada Ltd.
	 	Registration No.

07-0230142-0001

4/30/2007

(expires 4/28/2013)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Venmar Ventilation Inc.
	 	Xerox Canada Ltd.
	 	Registration No.

08-0388620-0003

7/4/2008

(expires 7/3/2014)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Venmar CES, Inc.
	 	Citicorp Vendor Finance,
Ltd.
Citicorp Finance Vendeur
Ltee
	 	Registration No.

06-0095190-006

2/24/2006

(expires 2/23/2010)
	 	Equipment






 









 






	 	 	 	 	 	 	 	 	 
	Filing Office	 	Debtor	 	Secured Party	 	Filing No./Date	 	Collateral
	Quebec (RPMRR)

	 	Venmar CES, Inc.
	 	Ryder Finance Corporation
	 	Registration No.

06-0251729-0001

5/8/2006

(expires 5/8/2013)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Venmar CES, Inc.
	 	Citicorp Vendor Finance,
Ltd.
	 	Registration No.

06-0482353-0001

8/22/2006

(expires 8/21/2013)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Venmar CES, Inc.
	 	Financement d’Équipement
Générale Électrique
Canada S.E.N.C.
	 	Registration No.

07-0657278-0001

11/15/2007

(expires 11/13/2013)
	 	Equipment
	 
	 	 	 	 	 	 	 	 
	Quebec (RPMRR)

	 	Venmar CES, Inc.
	 	Financement d’Équipement
Générale Électrique
Canada S.E.N.C.
	 	Registration No.

07-0657291-0001

11/15/2007

(expires 11/8/2013)
	 	Equipment







 












 





Schedule 7.02




Existing Investments



	 	 	 	 	 	 	 

	1997

	 	Investment by Nortek, Inc. in
Oak Ridge Capital — Realco in connection
with the acquisition of the stock of
Ply Gem Industries, Inc.
	 	$	384,000	 
	 
	 	 	 	 	 	 
	2005-2008

	 	Investment by Broan-NuTone LLC in
Broan Building Products (Huizhou) Co., Ltd.
in connection with the establishment of a
manufacturing facility in China.
	 	$	4,034,000	 
	 
	 	 	 	 	 	 
	2009

	 	Investment by Nortek, Inc. in Nortek (Shanghai)
Trading, Ltd. in connection with the formation
of a trading F.I.C.E. in China.
	 	$	150,000	 
	 
	 	 	 	 	 	 
	2009

	 	Investment by Ventrol Air Handling Systems Inc.
in Nortek International Holdings, B.V. for
working capital for its subsidiaries.
	 	 	C$3,353,368	 






 









 






Schedule 7.03(b)




Indebtedness



Intercompany Note, dated as of the Closing Date, among Nortek, Inc. and the Guarantors.




Earn-outs and contingent consideration under certain agreements entered into prior to the Closing
Date in connection with the acquisition of Imerge Ltd, Lite Touch, Inc., HomeLogic, LLC (now part
of Elan Home Systems, L.L.C.) in an amount of up to $11.25 million.




Other Indebtedness




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	BALANCE/CAPITALIZED	 	 	 	 	 	 
	 	 	AMOUNT @	 	 	 	 	 	 
	SUBSIDIARY (Debtor)	 	11/28/09	 	RATE	 	TERM	 	COLLATERAL
	BROAN-NUTONE LLC:
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Zephyr & Pacific 

Acquisition Notes

	 	 	—	 	 	 	6.0	%	 	1/2 Due 11/08;
 11/09
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	BEST S.P.A.:
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Short-Term Borrowings 

With Various Foreign Banks

	 	 	17,330	 	 	Varies
	 	Lines of Credit
	 	Accounts Receivable
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: BNL Short Term 

Borrowing

	 	 	2,844	 	 	 	5.50	%	 	Dec. 2009
	 	Unsecured
	Creditor/Obligation: Banca della Marche

(new 3Q05)

	 	 	482	 	 	6 month Euroribor + 1.25%
	 	7/2005-7/2010
	 	Unsecured
	Creditor/Obligation: Banca Pop AN (new 

4Q05)

	 	 	998	 	 	3 month Euroribor + 0.75%
	 	12/2005-10/2010
	 	Unsecured
	Creditor/Obligation: Banca di Roma (new
1Q06) — (POLAND)

	 	 	2,404	 	 	6 month Euroribor + 0.65%
	 	3/15/11
	 	Unsecured
	Creditor/Obligation: Banca di Roma (new
3Q07) — (Metaltecnica))

	 	 	2,694	 	 	6 month Euroribor + 0.65%
	 	9/1/12
	 	Unsecured
	Creditor/Obligation: Banca Pop AN (new
4Q07) — acquisitions

	 	 	2,833	 	 	3 month Euroribor + 0.75%
	 	10/2007 - 10/2012
	 	Unsecured
	Creditor/Obligation: Capital Lease — BMW
(new 1Q06)

	 	 	160	 	 	Varies
	 	Varies
	 	Equipment
	Creditor/Obligation: Capitalized Leases —
Combiparts

	 	 	677	 	 	Varies
	 	Varies
	 	Equipment
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	30,422	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	STILPOL S.P.ZO.O.
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Fortis Bank (new
3Q07) — Stilpol

	 	 	572	 	 	1 month WIBOR + 2.5%
	 	7/2007 - 8/2012
	 	Mortgage
	Creditor/Obligation:Capitalized Leases —
Stilpol

	 	 	145	 	 	Varies
	 	Varies
	 	Equipment
	 

	 	 	717	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	NORDYNE LLC:
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Boonville Warehouse 

Facility

	 	 	3,041	 	 	LIBOR
	 	12/04-11/19
	 	Facility
	Creditor/Obligation: Poplar Bluff Facility 

Lease

	 	 	3,995	 	 	 	9.5	%	 	11/00 to 11/15
	 	Facility
	Creditor/Obligation: Poplar Bluff Facility 

Addendum

	 	 	4,400	 	 	 	5.75	%	 	6/2004 - 10/2015
	 	Facility
	Creditor/Obligation: Dyersburg Facility 

Lease (Due 2013)

	 	 	4,031	 	 	 	5.725	%	 	8/03 -  7/2013
	 	Facility






 









 





	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	BALANCE/CAPITALIZED	 	 	 	 	 	 
	 	 	AMOUNT @	 	 	 	 	 	 
	SUBSIDIARY (Debtor)	 	11/28/09	 	RATE	 	TERM	 	COLLATERAL
	Creditor/Obligation: Dyersburg Facility 

Lease (Due 2018)

	 	 	1,010	 	 	 	6.00	%	 	8/03 - 7/2018
	 	Facility
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	16,477	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	ELAN HOME SYSTEMS, L.L.C.:
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Capital Lease — Phone
System

	 	 	45	 	 	 	6.02	%	 	60 Month (June06?)
	 	Equipment
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Note Payable -

Herman/Duncan (HomeLogic)

	 	 	1,000	 	 	 	6.00	%	 	July 2011
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	1,045	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	MAGENTA RESEARCH LTD.:
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Capital Lease

	 	 	1,488	 	 	 	7.25	%	 	9/2005 - 9/2015
	 	Building
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	ZEPHYR VENTILATION, LLC:
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Auto Loan

	 	 	27	 	 	Ranging from 2.9% to 13.99%
	 	1 in 2010; 2 in 2011
	 	Respective Vehicles
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	AIGIS MECHTRONICS, INC.
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: OAM Partners (Total

$642k)

	 	 	642	 	 	 	6.0	%	 	July 2011
	 	Unsecured
	Creditor/Obligation: OAM Partners -

Reserve (Amortizes until 2011)

	 	 	(284	)	 	 	6.0	%	 	July 2011
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Pentad Holdings

	 	 	434	 	 	 	6.0	%	 	July 2011
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: Salem Capital Partners

	 	 	851	 	 	 	6.0	%	 	July 2011
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: K. Todd

	 	 	111	 	 	 	6.0	%	 	July 2011
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: D. Myers

	 	 	100	 	 	 	6.0	%	 	July 2011
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: B. Kauffman

	 	 	44	 	 	 	6.0	%	 	July 2011
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: J. Fleming

	 	 	67	 	 	 	6.0	%	 	July 2011
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Creditor/Obligation: P. Katsaros

	 	 	82	 	 	 	6.0	%	 	July 2011
	 	Unsecured
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	2,047	 	 	 	 	 	 	 	 	 







 











 





Schedule 7.05




Dispositions



None.







 









 








Schedule 7.08




Transactions with Affiliates



None.





 









 








Schedule 7.09




Burdensome Agreements


Indenture, dated as of December 17, 2009, among Nortek, Inc., the guarantors from time to time
party thereto and U.S. Bank National Association, as trustee.



Collateral Agreement, dated as of December 17, 2009, among Nortek, Inc., the guarantors from time
to time party thereto and U.S. Bank National Association, as trustee.







 









 








Schedule 11.02




Administrative
Agent’s Office, Certain Addresses for Notices6


TO BORROWER, AGENT OR ANY BORROWER:




c/o Nortek, Inc.

50 Kennedy Plaza

Providence, RI 02903

Attention: Kevin W. Donnelly

Facsimile: 401-751-4610




with a copy to (which shall not constitute notice):




Weil, Gotshal & Manges, LLP

200 Crescent Court, Suite 300

Dallas, TX 75201

Attention: Angela L. Fontana

Facsimile: 214-746-7777




COLLATERAL AGENTS:




Bank of America, N.A.

335 Madison Avenue




New York, NY 10017

Attention: Robert Anchundia

Telephone: 212-503-7483

Facsimile: 212-503-7330

Electronic Mail: robert.anchundia@bankofamerica.com




General Electric Capital Corporation




299 Park Avenue, 3-7

New York, NY 10171

Attention: Denis Collins

Telephone: 646-428-7062

Facsimile: 646-428-7094

Electronic Mail: denis.collins@ge.com




Wells Fargo Foothill, LLC




2450 Colorado Ave.

Suite 3000W

Santa Monica, CA 90404

Attention: Ilene Silberman






 




			
	6	 	Lenders are in control of this schedule and
will provide final comments soon.




 









 










Telephone: 310-453-7460

Facsimile: 866-358-0919

Electronic Mail: ilene.silberman@wellsfargo.com



Administrative Agent’s Office



(for payments and Requests for Credit Extensions in respect of the Revolving Credit Facility (other
than the Canadian Revolving Credit Facility) and U.S. Swing Line Lender):




Bank of America, N.A.

20975 Swenson Drive

Waukesha, WI 53186

Attention: Jamie Epping, Credit Services Representative II

Telephone: 262-798-4829

Telecopier: 312-453-6631

Electronic Mail: jamie.epping@bankofamerica.com



Payment Instructions:



Bank of America, N.A.

100 West 33rd Street

New York, NY

ABA #: 026009593

Account Name: Bank of America 

Business Capital


Account #: 9369337536

Reference: Bank of America Business 

Capital and Nortek, Inc.



(for payments and Requests for Credit Extensions in respect of the Canadian Revolving Credit
Facility) 

[and Canadian Swingline Lender]:




Bank of America, N.A. (acting through its Canada branch)

200 Front Street West

Suite 2700

Toronto, Ontario M5V 3L2

Attention: Teresa Tsui

Facsimile: 416-349-4282

Electronic Mail



Payment Instructions:




CANADIAN DOLLARS: Wire payment of funds to:



LVTS – Large Value Transfer System

Bank of America Canada






 









 







200 Front Street West

Toronto, Ontario

Attention: Loans Department

TRANSIT #: 01342-241, Acct #: 90083255

SWIFT CODE: BOFACATT

Reference: Ventrol Air Handling Systems Inc.




U.S. DOLLARS: Wire payment of funds to:



Bank of America, N.A., New York

ABA# 026009593

335 Madison Avenue

New York, N.Y. 10017

SWIFT CODE: BOFAUS3N

For the Account of: Bank of America N.A., 

(acting through its Canada Branch)

Account #: 65502-01805

SWIFT CODE: BOFACATT

Reference: Ventrol Air Handling Systems Inc.



Other Notices as Administrative Agent:




Bank of America, N.A.

20975 Swenson Drive

Waukesha, WI 53186

Attention: Jamie Epping, Credit Services Representative II

Telephone: 262-798-4829

Telecopier: 312-453-6631

Electronic Mail: jamie.epping@bankofamerica.com




with a copy to:




Bank of America, N.A.

335 Madison Avenue

New York, NY 10017

Attention: Robert Anchundia

Telephone: 212-503-7483

Facsimile: 212-503-7330

Electronic Mail: robert.anchundia@bankofamercia.com




 









 





EXHIBIT A




FORM OF COMMITTED LOAN NOTICE




Date: ____________, ______




	To: 	 	Bank of America, N.A., as Administrative Agent




Ladies and Gentlemen:




          Reference is made to that certain Credit Agreement, dated as of December [___], 2009 (as
amended, restated, amended and restated, extended, supplemented or otherwise modified in writing
from time to time, the “Credit Agreement”; unless otherwise defined herein, the terms
defined therein being used herein as therein defined), among Nortek, Inc., a Delaware corporation
(the “Specified U.S. Borrower”), Ventrol Air Handling Systems Inc. (the “Canadian
Borrower”), the other Borrowers from time to time party thereto, Bank of America, N.A., as
Administrative Agent, the Lenders and L/C Issuers from time to time party thereto, and the other
agents party thereto.




           The undersigned hereby requests (select one):





	 	o 	 	A Borrowing of [U.S.][Canadian] Revolving Credit Loans
	 
	 	o  	 	A conversion of [Type of Loans]
	 
	 	o  	 	A continuation of [Eurodollar][BA] Rate Loans






	 	1.	 	On                   
                    
                    
                     
                
      (a Business Day)(the “Credit Date”).
	 
	 	2.	 	In the principal amount of [$][Cdn. $]
             
                   
                
                   
             .
	 
	 	3.	 	Consisting of                
                  
                   
                   
         .
	 	 	 	                     
                [Type of Loan requested]
	 
	 	4.	 	[For Eurodollar Rate Loans and BA Rate Loans] With an Interest Period of
             
            
 days.





           The [U.S.][Canadian] Revolving Credit Borrowing requested herein complies with the proviso to
the first sentence of Section 2.01[(a)][(b)] of the Credit Agreement.







Form of Committed Loan Notice


A-1 









 








          The [Specified U.S.][Canadian] Borrower hereby represents and warrants that the conditions
specified in Sections 4.02(a), (b) and (d) of the Credit Agreement shall be satisfied on
and as of the Credit Date.




	 	 	 	 	 
	 	[NORTEK, INC.][VENTROL AIR HANDLING SYSTEMS INC.]

 	 
	 	By:  	 	 
	 
	 	Name:  
	 
	 
	 	Title:  
	 



Form of Committed Loan Notice

A-2 









 






	 	 	 	 	 



EXHIBIT B




FORM OF SWING LINE LOAN NOTICE




Date:                                         ,                     





	To: Bank of America, N.A., as [U.S.][Canadian] Swing Line Lender
Bank of America, N.A., as Administrative Agent




Ladies and Gentlemen:




          Reference is made to that certain Credit Agreement, dated as of December [___], 2009 (as
amended, restated, amended and restated, extended, supplemented or otherwise modified in writing
from time to time, the “Credit Agreement”; unless otherwise defined herein, the terms
defined therein being used herein as therein defined), among Nortek, Inc., a Delaware corporation
(the “Specified U.S. Borrower”), Ventrol Air Handling Systems Inc. (the “Canadian
Borrower”), the other Borrowers from time to time party thereto, Bank of America, N.A., as
Administrative Agent, the Lenders and L/C Issuers from time to time party thereto, and the other
agents party thereto.




          The undersigned hereby requests a [U.S.][Canadian] Swing Line Loan:





	 	1.	 	On            
                     
                    
                     
       (a Business Day)(the “Credit Date”).
	 
	 	2.	 	In the amount of [$][Cdn. $]       
                   
                   
                    
        
        .





          The [U.S.][Canadian] Swing Line Borrowing requested herein complies with the requirements of
the provisos to the first sentence of Section 2.04[(A)(a)][(B)(a)] of the Credit Agreement.




          The [Specified U.S.][Canadian] Borrower hereby represents and warrants that the conditions
specified in Sections 4.02(a),(b) and (d) of the Credit Agreement shall be satisfied on and
as of the Credit Date.




	 	 	 	 	 
	 	[NORTEK, INC.][VENTROL AIR HANDLING SYSTEMS INC.]

 	 
	 	By:  	 	 
	 
	 	Name:  	 	 
	 
	 	Title:  	 	 
	 




Form of
Swing Line Loan Notice


B-1 











 





EXHIBIT C-1




FORM OF U.S. REVOLVING CREDIT NOTE




			
	$[___,___,___]
	 	                    , ___






          FOR VALUE RECEIVED, the undersigned (the “Borrower”), for itself and as Borrower Agent
under this Note for the U.S. Borrowers, HEREBY PROMISES TO PAY to                                          or its
registered assigns (the “Lender”), in accordance with the provisions of the Credit
Agreement (as hereinafter defined), the principal amount of each U.S. Loan from time to time made
by the Lender to the Borrower under that certain Credit Agreement, dated as of December [___], 2009
(as amended, restated, amended and restated, extended, supplemented or otherwise modified in
writing from time to time, the “Credit Agreement”; unless otherwise defined herein, the
terms defined therein being used herein as therein defined), among the Borrower, Ventrol Air
Handling Systems Inc. (the “Canadian Borrower”), the other Loan Parties from time to time
party thereto, Bank of America, N.A., as Administrative Agent, the lenders and L/C Issuers from
time to time party thereto, and the other agents party thereto.



          The Borrower promises to pay interest on the unpaid principal amount of each U.S. Loan made by
the Lender from the date of such Loan until such principal amount is paid in full, at such interest
rates and at such times as provided in the Credit Agreement. Except as otherwise provided in
Section 2.04(A)(f) of the Credit Agreement with respect to U.S. Swing Line Loans, all
payments of principal and interest with respect to the U.S. Loans made by the Lender shall be made
to the Administrative Agent for the account of the Lender in Dollars in immediately available funds
at the Administrative Agent’s Office. If any amount is not paid in full when due hereunder, such
unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date
of actual payment (and before as well as after judgment) computed at the per annum rate set forth
in the Credit Agreement.



          This U.S. Revolving Credit Note is one of the Revolving Credit Notes referred to in the Credit
Agreement, is entitled to the benefits thereof and may be prepaid in whole or in part subject to
the terms and conditions provided therein. This U.S. Revolving Credit Note is also entitled to the
benefits of the U.S. Guaranty and is secured by the U.S. Collateral. Upon the occurrence and
continuation of one or more of the Events of Default specified in the Credit Agreement, all amounts
then remaining unpaid on this U.S. Revolving Credit Note shall become, or may be declared to be,
immediately due and payable all as provided in the Credit Agreement. U.S. Loans made by the Lender
shall be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary
course of business. The Lender may also attach schedules to this U.S. Revolving Credit Note and
endorse thereon the date, Type, amount and maturity of its U.S. Loans and payments with respect
thereto.



          The Borrower, for itself, its successors and assigns, hereby waives diligence, presentment,
protest and demand and notice of protest, demand, dishonor and non-payment of this U.S. Revolving
Credit Note.



Form of U.S. Revolving Credit Note






C-1-1









 








          THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.



	 	 	 	 	 
	 	NORTEK, INC.,




as the Specified U.S. Borrower

 	 
	 	By:  	 	 
	 
	 	Name:  
	 
	 
	 	Title:  

	 
	 
	 	NORTEK, INC.,


as Borrower Agent under this Note for the U.S.

Borrowers

 	 
	 	By:  	 	 
	 
	 	Name:  
	 
	 
	 	Title:  
	 
	 



Form of U.S. Revolving Credit Note








C-1-2









 








U.S. LOANS AND PAYMENTS WITH RESPECT THERETO




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Amount of	 	Outstanding	 	 
	 	 	 	 	 	 	End of	 	Principal or	 	Principal	 	 
	 	 	Type of Loan	 	Amount of	 	Interest	 	Interest Paid	 	Balance	 	Notation
	Date	 	Made	 	Loan Made	 	Period	 	This Date	 	This Date	 	Made By
	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 





Form of U.S. Revolving Credit Note







C-1-3









 








EXHIBIT C-2




FORM OF CANADIAN REVOLVING CREDIT NOTE




			
	[U.S.] [Cdn.] $[___,___,___]
	 	                    , ___






          FOR VALUE RECEIVED, the undersigned (the “Borrower”), HEREBY PROMISES TO PAY to
                                         or its registered assigns (the “Lender”), in accordance with the
provisions of the Credit Agreement (as hereinafter defined), the principal amount of each Canadian
Loan from time to time made by the Lender to the Borrower under that certain Credit Agreement,
dated as of December [___], 2009 (as amended, restated, amended and restated, extended, supplemented
or otherwise modified in writing from time to time, the “Credit Agreement”; unless
otherwise defined herein, the terms defined therein being used herein as therein defined), among
Nortek, Inc., a Delaware corporation (the “Specified U.S. Borrower”), the Borrower, the
other Loan Parties from time to time party thereto, Bank of America, N.A., as Administrative Agent,
the lenders and L/C Issuers from time to time party thereto, and the other agents party thereto.



          The Borrower promises to pay interest on the unpaid principal amount of each Canadian Loan
made by the Lender from the date of such Loan until such principal amount is paid in full, at such
interest rates and at such times as provided in the Credit Agreement. Except as otherwise provided
in Section 2.04(B)(f) of the Credit Agreement with respect to Canadian Swing Line Loans,
all payments of principal and interest with respect to each Canadian Loan made by the Lender shall
be made to the Administrative Agent for the account of the Lender in Dollars or Canadian Dollars,
as applicable, in immediately available funds at the Administrative Agent’s Office. If any amount
is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon
demand, from the due date thereof until the date of actual payment (and before as well as after
judgment) computed at the per annum rate set forth in the Credit Agreement.



          This Canadian Revolving Credit Note is one of the Revolving Credit Notes referred to in the
Credit Agreement, is entitled to the benefits thereof and may be prepaid in whole or in part
subject to the terms and conditions provided therein. This Canadian Revolving Credit Note is also
entitled to the benefits of the Guaranties and is secured by the Collateral. Upon the occurrence
and continuation of one or more of the Events of Default specified in the Credit Agreement, all
amounts then remaining unpaid on this Canadian Revolving Credit Note shall become, or may be
declared to be, immediately due and payable all as provided in the Credit Agreement. Canadian
Loans made by the Lender shall be evidenced by one or more loan accounts or records maintained by
the Lender in the ordinary course of business. The Lender may also attach schedules to this
Canadian Revolving Credit Note and endorse thereon the date, Type, amount and maturity of its
Canadian Loans and payments with respect thereto.



          The Borrower, for itself, its successors and assigns, hereby waives diligence, presentment,
protest and demand and notice of protest, demand, dishonor and non-payment of this Canadian
Revolving Credit Note.



Form of Canadian Revolving Credit Note







C-2-1









 








          THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.



	 	 	 	 	 
	 	VENTROL AIR HANDLING



SYSTEMS INC.

 	 
	 	By:  	 	 
	 
	 	Name:
	 
	 
	 	Title:
	 
	 



Form of Canadian Revolving Credit Note







C-2-2









 








CANADIAN LOANS AND PAYMENTS WITH RESPECT THERETO




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Amount of	 	Outstanding	 	 
	 	 	 	 	 	 	End of	 	Principal or	 	Principal	 	 
	 	 	Type of Loan	 	Amount of	 	Interest	 	Interest Paid	 	Balance	 	Notation
	Date	 	Made	 	Loan Made	 	Period	 	This Date	 	This Date	 	Made By
	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 





Form of Canadian Revolving Credit Note






C-2-3









 








EXHIBIT D




FORM OF COMPLIANCE CERTIFICATE




Financial Statement Date:                     , ____





	To:	 	Bank of America, N.A., as Administrative Agent




Ladies and Gentlemen:




          Reference is made to that certain Credit Agreement, dated as of December [___], 2009 (as
amended, restated, amended and restated, extended, supplemented or otherwise modified in writing
from time to time, the “Credit Agreement”; unless otherwise defined herein, the terms
defined therein being used herein as therein defined), among Nortek, Inc., a Delaware corporation
(the “Specified U.S. Borrower”), Ventrol Air Handling Systems Inc. (the “Canadian
Borrower”), the other Borrowers from time to time party thereto, Bank of America, N.A., as
Administrative Agent, the Lenders and L/C Issuers from time to time party thereto, and the other
agents party thereto.



          The undersigned Responsible Officer hereby certifies as of the date hereof that he/she is the
                                                             of the Specified U.S. Borrower, and that, as such, he/she is
authorized to execute and deliver this Compliance Certificate to the Administrative Agent on the
behalf of the Specified U.S. Borrower, and that:



[Use following paragraph 1 for fiscal year-end financial statements]




          1. [The Specified U.S. Borrower has delivered the year-end audited consolidated financial
statements required by Section 6.01(a) of the Credit Agreement for the fiscal year of the
Specified U.S. Borrower ended as of the above date, together with the report and opinion of [Ernst
& Young LLP][an independent certified public accountant of nationally recognized standing] required
by such section, prepared in accordance with generally accepted auditing standards and not subject
to any “going concern” or like qualification or exception or any qualification or exception as to
the scope of the audit.]



[Use following paragraph 1 for fiscal quarter-end financial statements]




          1. [The Specified U.S. Borrower has delivered the unaudited consolidated financial statements
required by Section 6.01(b) of the Credit Agreement for the fiscal quarter of the Specified
U.S. Borrower ended as of the above date. Such consolidated financial statements fairly present in
all material respects the financial condition, results of operations, shareholders’ equity and cash
flows of the Specified U.S. Borrower and its Subsidiaries in accordance with GAAP as at such date
and for such period, subject only to normal year-end audit adjustments and the absence of
footnotes.]



          [Add the following statement to paragraph 1 for Compliance Certificates delivered with
financial statements required under Section 6.01(a) or (b) of the Credit Agreement when a Covenant
Trigger Event has occurred and is continuing and there has been a change in generally accepted
accounting principles used in the preparation of such financial statements, if necessary for the
determination of compliance with Section 7.11 of the Credit Agreement]



          [There has been a change in the generally accepted accounting principles used in the
preparation of such financial statements, and a statement of reconciliation conforming such
financial statements to GAAP is attached hereto.]



Form of Compliance Certificate






D-1









 








          [Use the following statements, as applicable, for Compliance Certificates delivered with
financial statements required under Section 6.01(a) or (b) of the Credit Agreement]



          2. [The undersigned has reviewed and is familiar with the terms of the Credit Agreement and
has made, or has caused to be made under his/her supervision, a detailed review of the transactions
and condition (financial or otherwise) of the Specified U.S. Borrower and its Subsidiaries during
the accounting period covered by such financial statements.]



          3. [A review of the activities of the Specified U.S. Borrower and its Subsidiaries during such
fiscal period has been made under the supervision of the undersigned with a view to determining
whether during such fiscal period the Specified U.S. Borrower and the other Loan Parties performed
and observed all its Obligations under the Loan Documents, and



[select one:]




          [to the best knowledge of the undersigned, during such fiscal period the Specified U.S.
Borrower and the other Loan Parties performed and observed each covenant and condition of the Loan
Documents applicable to it, and no Default has occurred and is continuing.]



—or—




          [to the best knowledge of the undersigned, the following covenants or conditions have not been
performed or observed and the following is a list of each such Default and its nature and status
and the actions that the Specified U.S. Borrower and its Subsidiaries proposes to take with respect
thereto:]]



          [Use the following statement for Compliance Certificates delivered with financial statements
required under Section 6.01(a) or (b) of the Credit Agreement and calculations required under
Section 7.02(n)(iii) or 7.06(f) of the Credit Agreement]



          4. The financial covenant analyses and information set forth on Schedules 1 and
2 attached hereto are true and accurate in all material respects on and as of the date of
this Compliance Certificate.



          [Use the following statement, if applicable, for Compliance Certificates delivered with
financial statements required under Section 6.01(a) or (b) of the Credit Agreement]



          5. [Attached hereto as Schedule 3 is a description of each event, condition or circumstance
during the past fiscal quarter requiring a mandatory prepayment under Section 2.05(b) of the Credit
Agreement.]



          IN WITNESS WHEREOF, the undersigned has executed this Compliance Certificate as
of                                         ,                     .



Form of Compliance Certificate







D-2









 








	 	 	 	 	 
	 	NORTEK, INC.

 	 
	 	By:  	 	 
	 
	 	Name:
	 
	 
	 	Title:
	 
	 



Form of Compliance Certificate





D-3











 





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




SCHEDULE
11

to the Compliance Certificate

($ in 000’s)



	 	 	 	 	 	 	 	 	 	 	 

	I.	 	Section 7.11 – Consolidated Fixed Charge Coverage Ratio.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	A.
	 	 	1.	 	 	Consolidated EBITDA for Measurement Period ending on above date (“Subject Period”):
	 	$                    
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	2.	 	 	The aggregate amount of all Capital Expenditures for Subject
Period:
	 	$                    
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	3.	 	 	Taxes paid or payable in cash (net of refunds received or
receivable) for Subject Period:
	 	$                    
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	4.	 	 	Line I.A.1 – (Line I.A.2 + Line I.A.3):
	 	$                    
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	B.	 	 	The sum of:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	1.	 	 	Consolidated Net Cash Interest Charges for Subject Period:
	 	$                    
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	2.	 	 	The aggregate principal amount of all Mandatory Principal
Payments, but excluding (A) any such payments to the extent
refinanced through the incurrence of additional Indebtedness
otherwise expressly permitted under Section 7.03, (B) any such
payments in respect of seller notes, earn-outs or the Existing
Credit Facility in each case made before the Closing Date, for
the Subject Period and (C) the amount of Consolidated Net Cash
Interest Charges and Mandatory Principal Payments attributable
to the 2011 Senior Subordinated Notes, the 2014 Senior
Subordinated Notes, the 103/4% Senior Discount Notes due 2014 of
NTK Holdings, Inc. and other Indebtedness of NTK Holdings, Inc.
that in each case have been converted into new common equity of
the Specified U.S. Borrower or otherwise extinguished pursuant
to the Approved Plan of Reorganization.
	 	$                    
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	3.	 	 	Line II.B.1 + Line II.B.2:
	 	$                    
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	C.	 	 	Consolidated Interest Coverage Ratio (Line I.A.4  ̧ Line I.B.3):	 	____ to 1
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	Minimum required:	 	 








 




			
	1	 	This form of Schedule is for template
purposes only and does not in any way amend, supersede or otherwise modify any
provisions in the Credit Agreement relating to the calculation of Consolidated
Fixed Charge Coverage Ratio or any components thereof.




Form of Compliance Certificate

D-4









 










	 	 	 

	 Four Fiscal Quarters Ending

	 	Minimum Consolidated

Interest Coverage Ratio
	 
	When a Covenant Trigger Event has occurred and is continuing

	 	1.1 to 1.0






Form of Compliance Certificate

D-5









 






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




SCHEDULE
22

to the Compliance Certificate

($ in 000’s)



Consolidated EBITDA

(in accordance with the definition of Consolidated EBITDA

as set forth in the Credit Agreement)



	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Twelve
	Consolidated	 	Quarter	 	Quarter	 	Quarter	 	Quarter	 	Months
	EBITDA	 	Ended	 	Ended	 	Ended	 	Ended	 	Ended
	Consolidated 

Net Income
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	+ consolidated 

interest expenses
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	+ provision for 

taxes based on 

income/profits
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	+ depreciation,
amortization and
other non-cash
expenses
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	+ reasonable
expenses, fees or
charges related to
the Transactions or
any acquisition or
Investment
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	+ non-recurring
cash charges up to
an aggregate of
$3,000,000 in one
fiscal year
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	- non-cash items 

increasing such 

Consolidated Net 

Income for the 

Subject
	 	 	 	 	 	 	 	 	 	 








 




			
	2	 	This form of Schedule is for template
purposes only and does not in any way amend, supersede or otherwise modify any
provisions in the Credit Agreement relating to the calculation of Consolidated
EBITDA or any components thereof.




Form of
Compliance Certificate

D-6









 










	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Twelve
	Consolidated	 	Quarter	 	Quarter	 	Quarter	 	Quarter	 	Months
	EBITDA	 	Ended	 	Ended	 	Ended	 	Ended	 	Ended
	Period,
excluding any items
which represent the
reversal of any
accrual of, or cash
reserve for,
anticipated cash
charges in any
period
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	= Consolidated
EBITDA
	 	 	 	 	 	 	 	 	 	 







Form of
Compliance Certificate

D-7











 





EXHIBIT E-1




FORM OF ASSIGNMENT AND ASSUMPTION




          This Assignment and Assumption (this “Assignment and Assumption”) is dated as of the
Effective Date set forth below and is entered into by and between
[the][each]1 Assignor
identified in item 1 below ([the][each, an]
“Assignor”) and
[the][each]2
Assignee identified in item 2 below ([the][each, an] “Assignee”). [It is understood and
agreed that the rights and obligations of [the
Assignors][the
Assignees]3 hereunder are
several and not
joint.]4 Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below, receipt of a copy of which is
hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1
attached hereto are hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.



          For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the
Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and
assumes from [the Assignor][the respective Assignors], subject to and in accordance with the
Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’]
rights and obligations in [its capacity as a Lender][their respective capacities as Lenders] under
the Credit Agreement and any other documents or instruments delivered pursuant thereto to the
extent related to the amount and percentage interest identified below of all of such outstanding
rights and obligations of [the Assignor][the respective Assignors] under the respective facilities
identified below (including, without limitation, the Letters of Credit and the Swing Line Loans
included in such facilities) and (ii) to the extent permitted to be assigned under applicable law,
all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a
Lender)][the respective Assignors (in their respective capacities as Lenders)] against any Person,
whether known or unknown, arising under or in connection with the Credit Agreement, any other
documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in
any way based on or related to any of the foregoing, including, but not limited to, contract
claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity
related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights
and obligations sold and assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses
(i) and (ii) above being referred to herein collectively as [the][an] “Assigned Interest”).
Each such sale and assignment is without recourse to [the][any] Assignor and, except as expressly
provided in this Assignment and Assumption, without representation or warranty by [the][any]
Assignor.



	 	 	 	 	 	 	 

	1.

	 	Assignor[s]: 

	 	 
	 
	 	 	 	 	 	 
	 

	 	
	 	 







 




			
	1	 	For bracketed language here and
elsewhere in this form relating to the Assignor(s), if the assignment is from a
single Assignor, choose the first bracketed language. If the assignment is
from multiple Assignors, choose the second bracketed language.
	 
	2	 	For bracketed language here and
elsewhere in this form relating to the Assignee(s), if the assignment is to a
single Assignee, choose the first bracketed language. If the assignment is to
multiple Assignees, choose the second bracketed language.
	 
	3	 	Select as appropriate.
	 
	4	 	Include bracketed language if there are
either multiple Assignors or multiple Assignees.





Form of Assignment and Assumption






E-1-1









 








	 	 	 	 	 	 	 

	2.

	 	Assignee[s]:


	 	 
	 
	 	 	 	 	 	 
	 

	 	
	 	 
	 	 	[for each Assignee, indicate [Affiliate][Approved Fund] of [identify Lender]]






	 	 	 	 	 	 	 

	3.

	 	Borrower(s): 

	 	 






	 	 	 

	4.

	 	Administrative Agent: Bank of America, N.A., as the Administrative Agent under the Credit Agreement
	 
	 	 
	5.

	 	Credit Agreement: Credit Agreement, dated as of December [___], 2009 (as amended, restated,
amended and restated, extended, supplemented or otherwise modified in writing
from time to time, the “Credit Agreement”), among Nortek, Inc., a Delaware
corporation (the “Specified U.S. Borrower”), Ventrol Air Handling Systems Inc.
(the “Canadian Borrower”), the other Borrowers from time to time party
thereto, Bank of America, N.A., as Administrative Agent, the Lenders and L/C
Issuers from time to time party thereto, and the other agents party thereto.
	 
	 	 
	6.

	 	Assigned Interest:






	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Aggregate	 	 	 	Percentage	 	 
	 	 	 	 	 	 	Amount of	 	Amount of	 	Assigned of	 	 
	 	 	 	 	Facility	 	Commitment/Loans	 	Commitment/Loans	 	Commitment/	 	CUSIP
	Assignor[s]5	 	Assignee[s]6	 	Assigned7	 	for all Lenders8	 	Assigned	 	Loans9	 	Number
	 
	 	 	 	                    	 	$                    	 	$                    	 	                    %	 	 
	 
	 	 	 	                    	 	$                    	 	$                    	 	                    %	 	 
	 
	 	 	 	                    	 	$                    	 	$                    	 	                    %	 	 






	 	 	 

	[7.

	 	Trade Date:                                         ]10





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




	 	 	 

	 

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








 




			
	5	 	List each Assignor, as appropriate.
	 
	6	 	List each Assignee, as appropriate.
	 
	7	 	Fill in the appropriate terminology for the
types of facilities under the Credit Agreement that are being assigned under
this Assignment (e.g. U.S. Revolving Credit Facility Loans, Canadian Revolving
Credit Facility Loans etc.)
	 
	8	 	Amounts in this column and in the column
immediately to the right to be adjusted by the counterparties to take into
account any payments or prepayments made between the Trade Date and the
Effective Date.
	 
	9	 	Set forth, to at least 9 decimals, as a
percentage of the Commitment/Loans of all Lenders thereunder.
	 
	10	 	To be completed if the Assignor and the
Assignee intend that the minimum assignment amount is to be determined as
of the Trade Date.





Form of Assignment and Assumption






E-1-2









 








	 	 	 	 	 
	 	ASSIGNOR




[NAME OF ASSIGNOR]

 	 
	 	By:  	 	 
	 	 	Title: 	 
	 	 	 	 
	 
	 	ASSIGNEE





[NAME OF ASSIGNEE]

 	 
	 	By:  	 	 
	 	 	Title: 	 
	 	 	 	 
	 


[Consented to and]11 Accepted:




	 	 	 	 	 
	BANK OF AMERICA, N.A., as Administrative Agent

 	 
	By:  	 	 
	 	Title: 	 
	 	 	 
	 


[Consented to:]



[BANK OF AMERICA, N.A.] [BANK OF AMERICA, N.A. (acting through its Canada branch] [Insert name of
other Lender or Affiliate acting as L/C Issuer], as [U.S. L/C Issuer] [Canadian L/C
Issuer]12 or [U.S. Swing Line Lender] [Canadian Swing Line Lender]13




	 	 	 	 	 
	 	 
	By:  	
 	 
	 	Title: 	 
	 	 	 
	 


[Consented to:]



[[NORTEK, INC.] [VENTROL AIR HANDLING SYSTEMS INC.], as Borrower]14






 




			
	11	 	To be added only if the assignment is to a
Person that is not a Lender with a Commitment, an Affiliate of such Lender or
an Approved Fund with respect to such Lender.
	 
	12	 	To be added only if the assignment increases
the obligation of the Assignee to participate in exposure under one or more
Letters of Credit (whether or not now outstanding).
	 
	13	 	To be added only if the assignment is in
respect of the Revolving Credit Facility.





	 	 	 	 	 
	Form of Assignment and Assumption
	 



E-1-3









 









	 	 	 	 	 
	 	 
	By:  	 	 
	 	Title: 	 
	 	 	 	 
	 





 




			
	14	 	To be added unless an Event of Default has
occurred and is continuing at time of assignment or such assignment is to
a Lender, an Affiliate of a Lender or an Approved Fund.





Form of Assignment and Assumption





E-1-4











 





ANNEX 1 TO ASSIGNMENT AND ASSUMPTION




          Credit Agreement, dated as of December [                    ], 2009 (as amended, restated, amended and restated,
extended, supplemented or otherwise modified in writing from time to time, the “Credit
Agreement”; unless otherwise defined herein, the terms defined therein being used herein as
therein defined), among Nortek, Inc., a Delaware corporation (the “Specified U.S.
Borrower”), Ventrol Air Handling Systems Inc. (the “Canadian Borrower”), the other
Borrowers from time to time party thereto, Bank of America, N.A., as Administrative Agent, the
Lenders and L/C Issuers from time to time party thereto, and the other agents party thereto.




STANDARD TERMS AND CONDITIONS FOR




ASSIGNMENT AND ASSUMPTION




          1. Representations and Warranties.




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




          1.2. Assignee. [The][Each] Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver this Assignment and
Assumption and to consummate the transactions contemplated hereby and to become a Lender under the
Credit Agreement, (ii) it meets all the requirements to be an assignee under Section
11.06(b)(iii), (v) and (vi) of the Credit Agreement (subject to such consents,
if any, as may be required under Section 11.06(b)of the Credit Agreement), (iii) from and
after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender
thereunder and, to the extent of [the][the relevant] Assigned Interest, shall have the obligations
of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the
type represented by [the][such] Assigned Interest and either it, or the Person exercising
discretion in making its decision to acquire [the][such] Assigned Interest, is experienced in
acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received
or has been accorded the opportunity to receive copies of the most recent financial statements
delivered pursuant to Section 6.01 thereof, as applicable, and such other documents and
information as it deems appropriate to make its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase [the][such] Assigned Interest, (vi) it has, independently
and without reliance upon the Administrative Agent or any other Lender and based on such documents
and information as it has deemed appropriate, made its own credit analysis and decision to enter
into this Assignment and Assumption and to purchase [the][such] Assigned Interest, and (vii) if it
is a Foreign Lender, attached hereto is any documentation required to be delivered by it pursuant
to the terms of the Credit Agreement, duly completed and executed by [the][such] Assignee; and (b)
agrees that (i) it will, independently and without reliance upon the Administrative Agent,
[the][any] Assignor or any other Lender, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in taking or





Form of Assignment and Assumption

E-1-5









 







not taking action under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are required to be performed
by it as a Lender.




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




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










Form of Assignment and Assumption

E-1-6









 








EXHIBIT E-2




FORM OF ADMINISTRATIVE QUESTIONNAIRE




	 	 	 

	I. Borrower Name:

	 	«FullCompanyName»
	 

	 	«FacilityAmount»






	 	 	 

	II. Legal Name of Lender for Signature Page:
	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	III. Domestic Address:

	 	IV. Eurodollar Address:
	 
	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	V. Contact Information:
	 	 






	 	 	 	 	 	 	 
	 	 	Credit Contact	 	Operations Contact	 	Legal Counsel
	 
	 	 	 	 	 	 
	Name:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Title:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Address:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Telephone:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Facsimile:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	E-Mail Address
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 





	 	 	 	 	 	 	 
	 	 	Secondary Credit	 	Secondary	 	Draft Documentation
	 	 	Contact	 	Operations Contact	 	Contact
	 
	 	 	 	 	 	 
	Name:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Title:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Address:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Telephone:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Facsimile:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	E-Mail Address
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 





Form of Administrative Questionnaire

E-2-1









 






	 	 	 	 	 

	VI. Lender’s Fed Wire Payment Instructions:	 	 
	Pay to:
	 	 	 	 
	 	 	 
	 

	 	(Name of Lender)	 	 
	 
	 	 	 	 
	 	 	 
	 

	 	(ABA#)
	 	(City/State)
	 
	 	 	 	 
	 	 	 
	 

	 	(Account #)
	 	(Account Name)
	 
	 	 	 	 
	 	 	 
	 

	 	(Attention)	 	 






	 	 	 	 	 

	VII. Lender’s
Standby L/C Fed Wire Payment Instructions (if applicable):	 	 
	Pay to:
	 	 	 	 
	 	 	 
	 

	 	(Name of Lender)	 	 
	 
	 	 	 	 
	 	 	 
	 

	 	(ABA#)
	 	(City/State)
	 
	 	 	 	 
	 	 	 
	 

	 	(Account #)
	 	(Account Name)
	 
	 	 	 	 
	 	 	 
	 

	 	(Attention)	 	 






	 	 	 

	VIII. Organizational Structure:
	 	 
	Type of Entity:
	 	 
	 

	 	 
	Lender’s Tax ID:
	 	 
	 





	 	 	 

	IX. Name of Authorized Officer:
	 	 
	 

	 	 
	Name:
	 	 
	 

	 	 
	Signature:
	 	 
	 

	 	 
	Date:
	 	 
	 

	 	 





Form of Administrative Questionnaire

E-2-2









 






X. Bank of America Contact Information:




	 	 	 	 	 	 	 
	 	 	 	 	 	 	Secondary
	 	 	Credit Contact	 	Operations Contact	 	Operations Contact
	 
	 	 	 	 	 	 
	Name:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Title:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Address:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Telephone:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	Facsimile:
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	E Mail Address
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 





X. Bank of America Payment Instructions:




	 	 	 

	Pay to:

	 	Sent under separate cover





PLEASE RETURN COMPLETED LENDER’S INFORMATION AND TAX FORM TO:











Form of Administrative Questionnaire

E-2-3









 





EXHIBIT F-1




U.S. GUARANTY




Dated as of December 17, 2009



From



THE GUARANTORS NAMED HEREIN



and



THE ADDITIONAL GUARANTORS REFERRED TO HEREIN



as Guarantors



in favor of



THE SECURED PARTIES REFERRED TO IN

THE CREDIT AGREEMENT REFERRED TO HEREIN








 









 








TABLE OF CONTENTS




	 	 	 	 	 
	Section	 	Page
	Section 1. Guaranty; Limitation of Liability

	 	 	3	 
	 
	 	 	 	 
	Section 2. Guaranty Absolute

	 	 	4	 
	 
	 	 	 	 
	Section 3. Waivers and Acknowledgments

	 	 	5	 
	 
	 	 	 	 
	Section 4. Subrogation

	 	 	6	 
	 
	 	 	 	 
	Section 5. Payments Free and Clear of Taxes, Etc

	 	 	7	 
	 
	 	 	 	 
	Section 6. Representations and Warranties

	 	 	7	 
	 
	 	 	 	 
	Section 7. Covenants

	 	 	8	 
	 
	 	 	 	 
	Section 8. Amendments, Guaranty Supplements, Etc

	 	 	8	 
	 
	 	 	 	 
	Section 9. Notices, Etc

	 	 	8	 
	 
	 	 	 	 
	Section 10. No Waiver; Remedies

	 	 	9	 
	 
	 	 	 	 
	Section 11. Right of Set-off

	 	 	9	 
	 
	 	 	 	 
	Section 12. Indemnification

	 	 	9	 
	 
	 	 	 	 
	Section 13. Subordination

	 	 	10	 
	 
	 	 	 	 
	Section 14. Continuing Guaranty; Assignments under the Credit Agreement

	 	 	10	 
	 
	 	 	 	 
	Section 15. Execution in Counterparts

	 	 	11	 
	 
	 	 	 	 
	Section 16. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc

	 	 	11	 
	 
	 	 	 	 
	Exhibit A — Guaranty Supplement
	 	 	 	 











F-1-2









 








U.S. GUARANTY




          U.S. GUARANTY, dated as of December 17, 2009, made by Nortek, Inc. (the “Specified U.S.
Borrower”), the Persons listed on the signature pages hereof and the Additional Guarantors (as
defined in Section 8(b)) (the Specified U.S. Borrower, such Persons so listed and the Additional
Guarantors being, collectively, the “Guarantors” and, individually, each a “Guarantor”) in favor of
the Secured Parties (as defined in the Credit Agreement referred to below).



          PRELIMINARY STATEMENT. The Specified U.S. Borrower and the other Loan Parties party thereto
are parties to a Credit Agreement, dated as of December 17, 2009 (as amended, restated, amended and
restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; the
capitalized terms defined therein and not otherwise defined herein being used herein as therein
defined), with certain Lenders party thereto, Bank of America, N.A., as Administrative Agent for
such Lenders, and the Collateral Agents party thereto. Each Guarantor may receive, directly or
indirectly, a portion of the proceeds of the Loans under the Credit Agreement and will derive
substantial direct and indirect benefits from the transactions contemplated by the Credit
Agreement. It is a condition precedent to the making of Loans by Lenders and the issuance of
Letters of Credit by the L/C Issuers under the Credit Agreement, the entry by the Hedge Banks into
Secured Hedge Agreements and the entry by the Cash Management Banks into Secured Cash Management
Agreements from time to time, that each Guarantor shall have executed and delivered this Guaranty.



          NOW, THEREFORE, in consideration of the premises and in order to induce the Lenders to make
Loans and the L/C Issuers to issue Letters of Credit under the Credit Agreement, the Hedge Banks to
enter into Secured Hedge Agreements and the Cash Management Banks to enter into Secured Cash
Management Agreements from time to time, each Guarantor, jointly and severally with each other
Guarantor, hereby agrees as follows:



          Section 1. Guaranty; Limitation of Liability. (a) Each Guarantor hereby absolutely,
unconditionally and irrevocably guarantees the punctual payment when due, whether at scheduled
maturity or on any date of a required prepayment or by acceleration, demand or otherwise, of all
Obligations of each other Loan Party now or hereafter existing under or in respect of the Loan
Documents (including, without limitation, any extensions, modifications, substitutions, amendments
or renewals of any or all of the foregoing Obligations), whether direct or indirect, absolute or
contingent, and whether for principal, interest, premiums, fees, indemnities, contract causes of
action, costs, expenses or otherwise (such Obligations being the “Guaranteed Obligations”), and
agrees to pay any and all documented out-of-pocket expenses (including, without limitation, fees
and expenses of counsel) incurred by the Administrative Agent or any other Secured Party in
enforcing any rights under this Guaranty or any other Loan Document. Without limiting the
generality of the foregoing, each Guarantor’s liability shall extend to all amounts that constitute
part of the Guaranteed Obligations and would be owed by any other Loan Party to any Secured Party
under or in respect of the Loan Documents but for the fact that they are unenforceable or not
allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving such
other Loan Party.



F-1-3









 





          (b) Each Guarantor, and by its acceptance of this Guaranty, the Administrative Agent and each
other Secured Party, hereby confirms that it is the intention of all such Persons that this
Guaranty and the Obligations of each Guarantor hereunder not constitute a fraudulent transfer or
conveyance for purposes of Debtor Relief Laws, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar foreign, federal or state law to the extent applicable to
this Guaranty and the Obligations of each Guarantor hereunder. To effectuate the foregoing
intention, the Administrative Agent, the other Secured Parties and the Guarantors hereby
irrevocably agree that the Obligations of each Guarantor under this Guaranty at any time shall be
limited to the maximum amount as will result in the Obligations of such Guarantor under this
Guaranty not constituting a fraudulent transfer or conveyance.



          (c) Each Guarantor hereby unconditionally and irrevocably agrees that in the event any payment
shall be required to be made to any Secured Party under this Guaranty or any other guaranty, such
Guarantor will contribute, to the maximum extent permitted by law, such amounts to each other
Guarantor and each other guarantor so as to maximize the aggregate amount paid to the Secured
Parties under or in respect of the Loan Documents.



          Section 2. Guaranty Absolute. Each Guarantor guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of the Loan Documents, regardless of
any Law now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of
any Secured Party with respect thereto. The Obligations of each Guarantor under or in respect of
this Guaranty are independent of the Guaranteed Obligations or any other Obligations of any other
Loan Party under or in respect of the Loan Documents, and a separate action or actions may be
brought and prosecuted against each Guarantor to enforce this Guaranty, irrespective of whether any
action is brought against the Borrowers or any other Loan Party or whether any Borrower or any
other Loan Party is joined in any such action or actions. The liability of each Guarantor under
this Guaranty shall be irrevocable, absolute and unconditional irrespective of, and each Guarantor
hereby irrevocably waives any defenses (other than indefeasible payment in full of the Guaranteed
Obligations) it may now have or hereafter acquire in any way relating to, any or all of the
following:




     (a) any lack of validity or enforceability of any Loan Document or any agreement or
instrument relating thereto;




     (b) any change in the time, manner or place of payment of, or in any other term of, all
or any of the Guaranteed Obligations or any other Obligations of any other Loan Party under
or in respect of the Loan Documents, or any other amendment or waiver of or any consent to
departure from any Loan Document, including, without limitation, any increase in the
Guaranteed Obligations resulting from the extension of additional credit to any Loan Party
or any of its Subsidiaries or otherwise;




     (c) any taking, exchange, release or non-perfection of any Collateral or any other
collateral, or any taking, release or amendment or waiver of, or consent to departure from,
any other guaranty, for all or any of the Guaranteed Obligations;




     (d) any manner of application of Collateral or any other collateral, or proceeds
thereof, to all or any of the Guaranteed Obligations, or any manner of sale or other



F-1-4









 







disposition of any Collateral or any other collateral for all or any of the Guaranteed
Obligations or any other Obligations of any Loan Party under the Loan Documents or any other
assets of any Loan Party or any of its Subsidiaries;




     (e) any change, restructuring or termination of the corporate structure or existence of
any Loan Party or any of its Subsidiaries;




     (f) any failure of any Secured Party to disclose to any Loan Party any information
relating to the business, condition (financial or otherwise), operations, performance,
properties or prospects of any other Loan Party now or hereafter known to such Secured Party
(each Guarantor waiving any duty on the part of the Secured Parties to disclose such
information);




     (g) the failure of any other Person to execute or deliver this Guaranty, any Guaranty
Supplement (as hereinafter defined) or any other guaranty or agreement or the release or
reduction of liability of any Guarantor or other guarantor or surety with respect to the
Guaranteed Obligations; or




     (h) any other circumstance (including, without limitation, any statute of limitations)
or any existence of or reliance on any representation by any Secured Party that might
otherwise constitute a defense available to, or a discharge of, any Loan Party or any other
guarantor or surety.


This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time
any payment of any of the Guaranteed Obligations is rescinded or must otherwise be returned by any
Secured Party or any other Person upon the insolvency, bankruptcy or reorganization of any Borrower
or any other Loan Party or otherwise, all as though such payment had not been made.




          Section 3. Waivers and Acknowledgments. (a) Each Guarantor hereby unconditionally
and irrevocably waives, to the fullest extent permitted by law, promptness, diligence, notice of
acceptance, presentment, demand for performance, notice of nonperformance, default, acceleration,
protest or dishonor and any other notice with respect to any of the Guaranteed Obligations and this
Guaranty and any requirement that any Secured Party protect, secure, perfect or insure any Lien or
any property subject thereto or exhaust any right or take any action against any Loan Party or any
other Person or any Collateral.



          (b) Each Guarantor hereby unconditionally and irrevocably waives, to the fullest extent
permitted by law, any right to revoke this Guaranty and acknowledges that this Guaranty is
continuing in nature and applies to all Guaranteed Obligations, whether existing now or in the
future.



          (c) Each Guarantor hereby unconditionally and irrevocably waives, to the fullest extent
permitted by law, (i) any defense arising by reason of any claim or defense based upon an election
of remedies by any Secured Party that in any manner impairs, reduces, releases or otherwise
adversely affects the subrogation, reimbursement, exoneration, contribution or indemnification
rights of such Guarantor or other rights of such Guarantor to proceed against any of the other Loan
Parties, any other guarantor or any other Person or any Collateral and (ii) any



F-1-5









 




defense based on any right of set-off or counterclaim against or in respect of the Obligations
of such Guarantor hereunder.




          (d) Each Guarantor acknowledges that the Administrative Agent may, in accordance with the
terms of the Loan Documents, without notice to or demand upon such Guarantor and without affecting
the liability of such Guarantor under this Guaranty, foreclose under any mortgage by nonjudicial
sale, and each Guarantor hereby waives, to the fullest extent permitted by law, any defense to the
recovery by the Administrative Agent and the other Secured Parties against such Guarantor of any
deficiency after such nonjudicial sale and any defense or benefits that may be afforded by
applicable Law.



          (e) Each Guarantor hereby unconditionally and irrevocably waives, to the fullest extent
permitted by law, any duty on the part of any Secured Party to disclose to such Guarantor any
matter, fact or thing relating to the business, condition (financial or otherwise), operations,
performance, properties or prospects of any other Loan Party or any of its Subsidiaries now or
hereafter known by such Secured Party.



          (f) Each Guarantor acknowledges that it will receive substantial direct and indirect benefits
from the financing arrangements contemplated by the Loan Documents and that the waivers set forth
in Section 2 and this Section 3 are knowingly made in contemplation of such benefits.



          Section 4. Subrogation. Each Guarantor hereby unconditionally and irrevocably agrees
not to exercise any rights that it may now have or hereafter acquire against the Borrowers, any
other Loan Party or any other insider guarantor that arise from the existence, payment, performance
or enforcement of such Guarantor’s Obligations under or in respect of this Guaranty or any other
Loan Document, including, without limitation, any right of subrogation, reimbursement, exoneration,
contribution or indemnification and any right to participate in any claim or remedy of any Secured
Party against the Borrowers, any other Loan Party or any other insider guarantor or any Collateral,
whether or not such claim, remedy or right arises in equity or under contract, statute or common
law, including, without limitation, the right to take or receive from the Borrowers, any other Loan
Party or any other insider guarantor, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security on account of such claim, remedy or right,
unless and until (i) the Aggregate Commitments shall have been terminated and all Obligations shall
have been paid in full (other than (A) contingent indemnification obligations as to which no claim
has been asserted and (B) obligations and liabilities under Secured Cash Management Agreements and
Secured Hedge Agreements as to which arrangements reasonably satisfactory to the applicable Cash
Management Bank or Hedge Bank shall have been made) and (ii) all Letters of Credit shall have
terminated or expired (other than Letters of Credit as to which other arrangements reasonably
satisfactory to the Administrative Agent and the applicable L/C Issuer shall have been made). If
any amount shall be paid to any Guarantor in violation of the immediately preceding sentence at any
time prior to the termination of the Aggregate Commitments and payment in full of all Obligations
(other than (A) contingent indemnification obligations as to which no claim has been asserted and
(B) obligations and liabilities under Secured Cash Management Agreements and Secured Hedge
Agreements as to which arrangements reasonably satisfactory to the applicable Cash Management Bank
or Hedge Bank shall have been made) and the expiration or termination of all



F-1-6









 




Letters of Credit (other than Letters of Credit as to which other arrangements reasonably
satisfactory to the Administrative Agent and the applicable L/C Issuer shall have been made), such
amount shall be received and held in trust for the benefit of the Secured Parties, shall be
segregated from other property and funds of such Guarantor and shall forthwith be paid or delivered
to the Administrative Agent in the same form as so received (with any necessary endorsement or
assignment) to be credited and applied to the Guaranteed Obligations and all other amounts payable
under this Guaranty, whether matured or unmatured, in accordance with the terms of the Loan
Documents, or to be held as Collateral for any Guaranteed Obligations or other amounts payable
under this Guaranty thereafter arising. If (i) any Guarantor shall make payment to any Secured
Party of all or any part of the Guaranteed Obligations, (ii) the Aggregate Commitments shall have
been terminated and all Obligations shall have been paid in full (other than (A) contingent
indemnification obligations as to which no claim has been asserted and (B) obligations and
liabilities under Secured Cash Management Agreements and Secured Hedge Agreements as to which
arrangements reasonably satisfactory to the applicable Cash Management Bank or Hedge Bank shall
have been made) and (iii) all Letters of Credit shall have terminated or expired (other than
Letters of Credit as to which other arrangements reasonably satisfactory to the Administrative
Agent and the applicable L/C Issuer shall have been made), the Secured Parties will, at such
Guarantor’s request and expense, execute and deliver to such Guarantor appropriate documents,
without recourse and without representation or warranty, necessary to evidence the transfer by
subrogation to such Guarantor of an interest in the Guaranteed Obligations resulting from such
payment made by such Guarantor pursuant to this Guaranty.




          Section 5. Payments Free and Clear of Taxes, Etc. Any and all payments made by any
Guarantor under or in respect of this Guaranty or any other Loan Document shall be made in
accordance with Sections 2.12 and 3.01 of the Credit Agreement, and such Guarantor shall make such
payments free and clear of and without deduction for any and all present or future Taxes and shall
indemnify each Secured Party for Indemnified Taxes and Other Taxes, in each case on the same terms
and to the same extent that payments by the Borrowers are required to be made free and clear of
such Taxes or the Borrowers are required to indemnify such Indemnified Taxes and Other Taxes,
pursuant to the terms of the Credit Agreement.



          Section 6. Representations and Warranties. Each Guarantor hereby makes each
representation and warranty made in the Loan Documents by the Borrowers with respect to such
Guarantor and each Guarantor hereby further represents and warrants as follows:




     (a) There are no conditions precedent to the effectiveness of this Guaranty that have
not been satisfied or waived.




     (b) Each Guarantor has, independently and without reliance upon any Secured Party and
based on such documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Guaranty and each other Loan Document to which it
is or is to be a party, and such Guarantor has established adequate means of obtaining from
each other Loan Party on a continuing basis information pertaining to, and is now and on a
continuing basis will be reasonably familiar with, the business, condition (financial or
otherwise), operations, performance, properties and prospects of such other Loan Party.



F-1-7









 





          Section 7. Covenants. Each Guarantor covenants and agrees that, until (i) the
Aggregate Commitments shall have been terminated and all Obligations shall have been paid in full
(other than (A) contingent indemnification obligations as to which no claim has been asserted and
(B) obligations and liabilities under Secured Cash Management Agreements and Secured Hedge
Agreements as to which arrangements reasonably satisfactory to the applicable Cash Management Bank
or Hedge Bank shall have been made) and (ii) all Letters of Credit shall have terminated or expired
(other than Letters of Credit as to which other arrangements reasonably satisfactory to the
Administrative Agent and the applicable L/C Issuer shall have been made), such Guarantor will
perform and observe, and cause each of its Subsidiaries to perform and observe, all of the terms,
covenants and agreements set forth in the Loan Documents on its or their part to be performed or
observed or that the Borrowers have agreed to cause such Guarantor or such Subsidiaries to perform
or observe.



          Section 8. Amendments, Guaranty Supplements, Etc. (a) No amendment or waiver of any
provision of this Guaranty and no consent to any departure by any Guarantor therefrom shall in any
event be effective unless the same shall be in writing executed in accordance with and subject to
the terms and conditions of Section 11.01 of the Credit Agreement, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose for which given.



          (b) Upon the execution and delivery by any Person of a guaranty supplement in substantially
the form of Exhibit A hereto (each, a “Guaranty Supplement”), (i) such Person shall be referred to
as an “Additional Guarantor” and shall become and be a Guarantor hereunder, and each reference in
this Guaranty to a “Guarantor” shall also mean and be a reference to such Additional Guarantor, and
each reference in any other Loan Document to a “U.S. Guarantor” or a “Guarantor” shall also mean
and be a reference to such Additional Guarantor, and (ii) each reference herein to “this Guaranty”,
“hereunder”, “hereof” or words of like import referring to this Guaranty, and each reference in any
other Loan Document to the “U.S. Guaranty”, ”thereunder”, “thereof” or words of like import
referring to this Guaranty, shall mean and be a reference to this Guaranty as supplemented by such
Guaranty Supplement.



          Section 9. Notices, Etc. All notices and other communications provided for hereunder
shall be in writing (including telegraphic, telecopy or telex communication) and mailed,
telegraphed, telecopied, telexed or delivered to the appropriate recipient, if to any Guarantor,
addressed to it in care of the Borrowers at the Borrowers’ addresses specified in Section 11.02 of
the Credit Agreement, if to the Administrative Agent or any Lender, at its address specified in
Section 11.02 of the Credit Agreement, if to any Hedge Bank, at its address specified in the
Secured Hedge Agreement to which it is a party, if to any Cash Management Bank, at its address
specified in the Secured Cash Management Agreement to which it is a party, or, as to any party, at
such other address as shall be designated by such party in a written notice to each other party.
All such notices and other communications shall, when mailed, telegraphed, telecopied or telexed,
be effective when deposited in the mails, delivered to the telegraph company, transmitted by
telecopier or confirmed by telex answerback, respectively. Delivery by telecopier, or in “pdf” or
similar format by electronic mail of an executed counterpart of a signature page to any amendment
or waiver of any provision of this Guaranty or of any Guaranty Supplement to be executed and
delivered hereunder shall be effective as delivery of an original executed counterpart thereof.



F-1-8









 





          Section 10. No Waiver; Remedies. No failure on the part of any Secured Party to
exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.



          Section 11. Right of Set-off. Upon the occurrence and during the continuance of any
Event of Default, each Lender and each L/C Issuer and each of their respective Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional or final) at any
time held and other obligations at any time owing by such Lender, such L/C Issuer or such Affiliate
to or for the credit or the account of any Guarantor against any and all of the Obligations of such
Guarantor now or hereafter existing under the Loan Documents, irrespective of whether such Lender,
such L/C Issuer or such Affiliate shall have made any demand under this Guaranty or any other Loan
Document and although such Obligations may be unmatured. Each Agent and each Lender agrees
promptly to notify such Guarantor after any such set-off and application; provided, however, that
the failure to give such notice shall not affect the validity of such set-off and application. The
rights of each Agent and each Lender and their respective Affiliates under this Section are in
addition to other rights and remedies (including, without limitation, other rights of set-off) that
such Agent, such Lender and their respective Affiliates may have.



          Section 12. Indemnification. (a) Without limitation on any other Obligations of any
Guarantor or remedies of the Secured Parties under this Guaranty, each Guarantor shall, to the
fullest extent permitted by law, jointly and severally indemnify and hold harmless each Secured
Party and their respective Related Parties (each, an “Indemnified Party”) from any and all claims,
damages, losses, liabilities and reasonably related expenses (including, without limitation,
reasonable and documented fees and out-of-pocket expenses of counsel) that may be incurred by or
asserted against any Indemnified Party in connection with or as a result of any failure of any
Guaranteed Obligations to be the legal, valid and binding obligations of any Loan Party enforceable
against such Loan Party in accordance with their terms; provided that such indemnity shall
not, as to any Indemnified Party, be available to the extent that such losses, claims, damages,
liabilities or related expenses (x) are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the bad faith, gross negligence or willful
misconduct of such Indemnified Party or (y) result from a claim brought by such Guarantor against
an Indemnified Party for breach of such Indemnified Party’s obligations hereunder or under any Loan
Document, if such Guarantor has obtained a final and nonappealable judgment in its favor on such
claim as determined by a court of competent jurisdiction.



          (b) Each Guarantor hereby also agrees that none of the Indemnified Parties shall have any
liability (whether direct or indirect, in contract, tort or otherwise) to any of the Guarantors or
any of their respective Related Parties, and each Guarantor hereby agrees not to assert any claim
against any Indemnified Party on any theory of liability, for special, indirect, consequential or
punitive damages, in each case arising out of or otherwise relating to the Facilities, the actual
or proposed use of the proceeds of the Loans or the Letters of Credit, the Loan Documents or any of
the transactions contemplated by the Loan Documents.



F-1-9









 





          (c) Without prejudice to the survival of any of the other agreements of any Guarantor under
this Guaranty or any of the other Loan Documents, the agreements and obligations of each Guarantor
contained in Section 1(a) (with respect to enforcement expenses), the last sentence of Section 2,
Section 5 and this Section 12 shall survive the payment in full of the Guaranteed Obligations and
all of the other amounts payable under this Guaranty.



          Section 13. Subordination. Each Guarantor hereby subordinates any and all debts,
liabilities and other Obligations owed to such Guarantor by each other Loan Party (the
“Subordinated Obligations”) to the Guaranteed Obligations to the extent and in the manner
hereinafter set forth in this Section 13:




     (a) Prohibited Payments, Etc. Except during the continuance of an Event of
Default, each Guarantor may receive regularly scheduled payments from any other Loan Party
on account of the Subordinated Obligations. After the occurrence and during the continuance
of any Event of Default, however, unless the Administrative Agent otherwise agrees, no
Guarantor shall demand, accept or take any action to collect any payment on account of the
Subordinated Obligations.




     (b) Prior Payment of Guaranteed Obligations. In any proceeding under any
Debtor Relief Law relating to any other Loan Party, each Guarantor agrees that the Secured
Parties shall be entitled to receive payment in full in cash of all Guaranteed Obligations
(including all interest and expenses accruing after the commencement of a proceeding under
any Debtor Relief Law, whether or not constituting an allowed claim in such proceeding
(“Post Petition Interest”)) before such Guarantor receives payment of any Subordinated
Obligations.




     (c) Turn-Over. After the occurrence and during the continuance of any Event of
Default, each Guarantor shall, if the Administrative Agent so requests, collect, enforce and
receive payments on account of the Subordinated Obligations as trustee for the Secured
Parties and deliver such payments to the Administrative Agent on account of the Guaranteed
Obligations (including all Post Petition Interest), together with any necessary endorsements
or other instruments of transfer, but without reducing or affecting in any manner the
liability of such Guarantor under the other provisions of this Guaranty.




     (d) Administrative Agent Authorization. After the occurrence and during the
continuance of any Event of Default, the Administrative Agent is authorized and empowered
(but without any obligation to so do), in its discretion, (i) in the name of each Guarantor,
to collect and enforce, and to submit claims in respect of, Subordinated Obligations and to
apply any amounts received thereon to the Guaranteed Obligations (including any and all Post
Petition Interest), and (ii) to require each Guarantor (A) to collect and enforce, and to
submit claims in respect of, Subordinated Obligations and (B) to pay any amounts received on
such obligations to the Administrative Agent for application to the Guaranteed Obligations
(including any and all Post Petition Interest).



          Section 14. Continuing Guaranty; Assignments under the Credit Agreement. This
Guaranty is a continuing guaranty and shall (a) remain in full force and effect until the
termination of the Aggregate Commitments and payment in full of all Obligations and the



F-1-10









 




expiration or termination of all Letters of Credit, (b) be binding upon the Guarantor, its
successors and assigns and (c) inure to the benefit of and be enforceable by the Secured Parties
and their successors, transferees and assigns. Without limiting the generality of clause (c) of
the immediately preceding sentence, any Secured Party may assign or otherwise transfer all or any
portion of its rights and obligations under the Credit Agreement (including, without limitation,
all or any portion of its Commitments, the Loans owing to it and the Note or Notes held by it) to
any other Person, and such other Person shall thereupon become vested with all the benefits in
respect thereof granted to such Secured Party herein or otherwise, in each case as and to the
extent provided in Section 11.06 of the Credit Agreement. No Guarantor shall have the right to
assign its rights hereunder or any interest herein without the prior written consent of the Secured
Parties.




          Section 15. Execution in Counterparts. This Guaranty and each amendment, waiver and
consent with respect hereto may be executed in any number of counterparts and by different parties
thereto in separate counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of a signature page to this Guaranty by telecopier or in “pdf” or similar
format by electronic mail shall be effective as delivery of an original executed counterpart of
this Guaranty.



          Section 16. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. (a) This
Guaranty shall be governed by, and construed in accordance with, the laws of the State of New York.



          (b) Each Guarantor hereby irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of any New York State court or federal court of the United
States of America sitting in New York City, and any appellate court from any thereof, in any action
or proceeding arising out of or relating to this Guaranty or any of the other Loan Documents to
which it is or is to be a party, or for recognition or enforcement of any judgment, and each
Guarantor hereby irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in any such New York State court or, to the extent
permitted by law, in such federal court. Each Guarantor agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Guaranty or any other Loan
Document shall affect any right that any party may otherwise have to bring any action or proceeding
relating to this Guaranty or any other Loan Document in the courts of any jurisdiction.



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



F-1-11









 





          (d) EACH GUARANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO ANY OF THE LOAN DOCUMENTS, THE CREDIT EXTENSIONS OR THE ACTIONS OF ANY SECURED PARTY IN
THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.



[REMAINDER OF PAGE INTENTIONALLY BLANK]









F-1-12









 








          IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly executed and delivered
by its officer thereunto duly authorized as of the date first above written.



	 	 	 	 	 
	 	NORTEK, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Edward J. Cooney 	 
	 	 	Title:  	Vice President 	 
	 




F-1-13











 





	 	 	 	 	 
	 	AIGIS MECHTRONICS, INC.

BROAN-MEXICO HOLDINGS, INC.

BROAN-NUTONE LLC

BROAN-NUTONE STORAGE SOLUTIONS LP

CES GROUP, INC.

CES INTERNATIONAL LTD.

CLEANPAK INTERNATIONAL, INC.

ELAN HOME SYSTEMS, L.L.C.

GATES THAT OPEN, LLC

GEFEN, LLC

GOVERNAIR CORPORATION

HC INSTALLATIONS, INC.

HUNTAIR, INC.

INTERNATIONAL ELECTRONICS, LLC

LINEAR LLC

LITE TOUCH, INC.

MAGENTA RESEARCH LTD.

MAMMOTH-WEBCO, INC.

NILES AUDIO CORPORATION

NORDYNE LLC

NORDYNE INTERNATIONAL, INC.

NORTEK LNTERNATIONAL, INC.

NUTONE LLC

OMNIMOUNT SYSTEMS, INC.

OPERATOR SPECIALTY COMPANY, INC.

PACIFIC ZEPHYR RANGE HOOD INC.

PANAMAX LLC

RANGAIRE GP, INC.

RANGAIRE LP, INC.

SECURE WIRELESS, INC.

SPEAKERCRAFT, LLC

TEMTROL, INC.

XANTECH LLC

ZEPHYR VENTILATION, LLC
 	 



	 	 	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Edward J. Cooney 	 
	 	 	Title:  	Vice President & Treasurer 	 



	 	 	 	 	 
	 	(of entity listed or as an officer of the

managing member, sole member or general partner)
 	 



 F-1-14 









 









 








Exhibit A

To The

U.S. Guaranty




FORM OF U.S. GUARANTY SUPPLEMENT




                                              ,                     




Bank of America, N.A., as Administrative Agent

[Address of Administrative Agent]



Attention:                     




Credit Agreement, dated as of December 17, 2009, among

Nortek, Inc., a Delaware corporation (the “Specified U.S. Borrower”), the other

Loan Parties thereto, the Lenders party to the Credit Agreement,

Bank of America, N.A., as Administrative Agent for the Lenders,

and the Collateral Agents party thereto.



Ladies and Gentlemen:





     Reference is made to the above-captioned Credit Agreement and to the U.S. Guaranty referred to
therein (such U.S. Guaranty, as in effect on the date hereof and as it may hereafter be amended,
restated, amended and restated, supplemented or otherwise modified from time to time, together with
this Guaranty Supplement, being the “U.S. Guaranty”). The capitalized terms defined in the U.S.
Guaranty or in the Credit Agreement and not otherwise defined herein are used herein as therein
defined.



     Section 1. Guaranty; Limitation of Liability. (a) The undersigned hereby absolutely,
unconditionally and irrevocably guarantees the punctual payment when due, whether at scheduled
maturity or on any date of a required prepayment or by acceleration, demand or otherwise, of all
Obligations of each other Loan Party now or hereafter existing under or in respect of the Loan
Documents (including, without limitation, any extensions, modifications, substitutions, amendments
or renewals of any or all of the foregoing Obligations), whether direct or indirect, absolute or
contingent, and whether for principal, interest, premium, fees, indemnities, contract causes of
action, costs, expenses or otherwise (such Obligations being the “Guaranteed Obligations”), and
agrees to pay any and all documented out-of-pocket expenses (including, without limitation, fees
and expenses of counsel) incurred by the Administrative Agent or any other Secured Party in
enforcing any rights under this Guaranty Supplement, the U.S. Guaranty, any Secured Hedge Agreement
or any Secured Cash Management Agreement or any other Loan Document. Without limiting the
generality of the foregoing, the undersigned’s liability shall extend to all amounts that
constitute part of the Guaranteed Obligations and would be owed by any other Loan Party to any
Secured Party under or in respect of the Loan Documents but for the fact that they are
unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving such other Loan Party.



 F-1-15 




 









 





     (b) The undersigned, and by its acceptance of this Guaranty Supplement, the Administrative
Agent and each other Secured Party, hereby confirms that it is the intention of all such Persons
that this Guaranty Supplement, the U.S. Guaranty and the Obligations of the undersigned hereunder
and thereunder not constitute a fraudulent transfer or conveyance for purposes of Debtor Relief
Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
foreign, federal or state law to the extent applicable to this Guaranty Supplement, the U.S.
Guaranty and the Obligations of the undersigned hereunder and thereunder. To effectuate the
foregoing intention, the Administrative Agent, the other Secured Parties and the undersigned hereby
irrevocably agree that the Obligations of the undersigned under this Guaranty Supplement and the
U.S. Guaranty at any time shall be limited to the maximum amount as will result in the Obligations
of the undersigned under this Guaranty Supplement and the U.S. Guaranty not constituting a
fraudulent transfer or conveyance.



     (c) The undersigned hereby unconditionally and irrevocably agrees that in the event any
payment shall be required to be made to any Secured Party under this Guaranty Supplement, the U.S.
Guaranty or any other guaranty, the undersigned will contribute, to the maximum extent permitted by
applicable law, such amounts to each other Guarantor and each other guarantor so as to maximize the
aggregate amount paid to the Secured Parties under or in respect of the Loan Documents.



     Section 2. Obligations Under the Guaranty. The undersigned hereby agrees, as of the
date first above written, to be bound as a Guarantor by all of the terms and conditions of the U.S.
Guaranty to the same extent as each of the other Guarantors thereunder. The undersigned further
agrees, as of the date first above written, that each reference in the U.S. Guaranty to an
“Additional Guarantor” or a “Guarantor” shall also mean and be a reference to the undersigned, and
each reference in any other Loan Document to a “U.S. Guarantor”, a “Guarantor” or a “Loan Party”
shall also mean and be a reference to the undersigned.



     Section 3. Representations and Warranties. The undersigned hereby makes each
representation and warranty set forth in Section 6 of the U.S. Guaranty to the same extent as each
other Guarantor.



     Section 4. Delivery by Telecopier. Delivery of an executed counterpart of a signature
page to this Guaranty Supplement by telecopier or in “pdf” or similar format by electronic mail
shall be effective as delivery of an original executed counterpart of this Guaranty Supplement.



     Section 5. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. (a) This Guaranty
Supplement shall be governed by, and construed in accordance with, the laws of the State of New
York.



     (b) The undersigned hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or any federal court of the
United States of America sitting in New York City, and any appellate court from any thereof, in any
action or proceeding arising out of or relating to this Guaranty Supplement, the U.S. Guaranty or
any of the other Loan Documents to which it is or is to be a party, or for recognition or
enforcement of any judgment, and the undersigned hereby irrevocably and



 F-1-16 




 









 




unconditionally agrees that all claims in respect of any such action or proceeding may be
heard and determined in any such New York State court or, to the extent permitted by law, in such
federal court. The undersigned agrees that a final judgment in any such action or proceeding shall
be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Guaranty Supplement or the U.S. Guaranty or any other Loan
Document shall affect any right that any party may otherwise have to bring any action or proceeding
relating to this Guaranty Supplement, the U.S. Guaranty or any of the other Loan Documents to which
it is or is to be a party in the courts of any other jurisdiction.




     (c) The undersigned irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection that it may now or hereafter have to the laying of
venue of any suit, action or proceeding arising out of or relating to this Guaranty Supplement, the
U.S. Guaranty or any of the other Loan Documents to which it is or is to be a party in any New York
State or federal court. The undersigned hereby irrevocably waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such suit, action or proceeding
in any such court.



     (d) THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO ANY OF THE LOAN DOCUMENTS, THE CREDIT EXTENSIONS OR THE ACTIONS OF ANY SECURED PARTY IN
THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.



	 	 	 	 	 
	 	Very truly yours,



[NAME OF ADDITIONAL GUARANTOR]

 	 
	 	By  	
 	 
	 	 	Title: 	 
	 	 	 	 
	 



 F-1-17 





 











 








EXHIBIT G-1




FORM OF U.S. SECURITY AGREEMENT








Form of U.S. Security Agreement

G-1-1









 





EXHIBIT H




FORM OF MORTGAGE




[FIRST LIEN] MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS

AND LEASES AND FIXTURE FILING ([ ])



by and from

[                                        ], “Mortgagor”



to



[U.S. BANK NATIONAL ASSOCIATION/BANK OF AMERICA, N.A.], in its capacity as Agent,

"Mortgagee”



Dated as of [                                         ___, 2010],



	 	 	 

	Location:

	 	[                    ]
	Municipality:

	 	[                    ]
	County:

	 	[                    ]
	State:

	 	[                    ]






[insert only if Mortgage is capped: THE MAXIMUM PRINCIPAL INDEBTEDNESS WHICH IS

SECURED BY OR WHICH BY ANY CONTINGENCY MAY BE SECURED BY THIS

MORTGAGE IS $                                         .]




THIS INSTRUMENT IS EXEMPT FROM RECORDATION TAXES PURSUANT TO

SECTIONS 105(a) AND 1146(a) OF THE UNITED STATES BANKRUPTCY CODE.




THE SECURED PARTY (MORTGAGEE) DESIRES THIS FIXTURE FILING TO BE INDEXED

AGAINST THE RECORD OWNER OF THE REAL ESTATE DESCRIBED HEREIN.



THIS MORTGAGE IS SUBJECT TO THE PROVISIONS OF THE LIEN SUBORDINATION

AND INTERCREDITOR AGREEMENT DATED AS OF [ , 2009] AMONG NORTEK, INC.,

OTHER SUBSIDIARIES OF NORTEK, INC. NAMED THEREIN, BANK OF AMERICA, N.A.,

AS COLLATERAL AGENT FOR THE REVOLVING CREDIT FACILITY SECURED PARTIES

REFERRED TO THEREIN, AND U.S. BANK NATIONAL ASSOCIATION AS NOTEHOLDER

COLLATERAL AGENT, AS MORE FULLY SET FORTH IN SECTION 2.4 HEREOF.



PREPARED BY, RECORDING REQUESTED BY,

AND WHEN RECORDED MAIL TO:



[First lien only: Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas New York, NY 10019-6064

Attention: [                    ]



[Second lien only: Shearman & Sterling LLP

599 Lexington Avenue

New York, New York 10022-6069

Attention: Malcolm K. Montgomery, Esq.

File #                                         ]



 









 





[FIRST LIEN] MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS

AND LEASES AND FIXTURE FILING
([                                      &
nbsp; ])




        
  THIS [FIRST LIEN] MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND LEASES AND FIXTURE
FILING ([                    ])
 (this “Mortgage”) is dated as of [                    ], 2010 by and from
[                    ], a [                
                        ]
(“Mortgagor”), whose address is [                     ] to [U.S. BANK NATIONAL ASSOCIATION/BANK OF
AMERICA, N.A.], a
[                    ]
[                    ],
 as collateral agent (in such capacity, “Agent’) for the Secured Parties [as defined below
in the Credit Agreement [(defined below)], having an address at [                    ] (Agent, together with its
successors and assigns, “Mortgagee”).



[insert only if Mortgage is capped: ANY PROVISION HEREIN TO THE CONTRARY NOTWITHSTANDING, THE
MAXIMUM PRINCIPAL INDEBTEDNESS WHICH IS SECURED BY OR WHICH BY ANY CONTINGENCY MAY BE SECURED BY
THIS MORTGAGE IS $[                    ] (THE “SECURED AMOUNT’).]




RECITALS




          WHEREAS, Nortek, Inc. and certain affiliates (the “[Issuers/Borrowers]”) have entered into
that certain [Indenture/Credit Agreement] dated as of [December ___, 2009] (as amended, amended and
restated, supplemented or otherwise modified from time to time, the “[Indenture/Credit Agreement]”)
with the Guarantors party thereto [, the other parties identified therein] Agent and other Secured
Parties identified therein;




          WHEREAS, upon the motion of [Issuers/Borrowers] and certain of their affiliates, the United
States Bankruptcy Court, Southern District of New York, entered that certain “[Order Confirming
Plan of Reorganization]”, dated
[                                       
  2009], which order confirmed the Approved Plan of Reorganization
as defined in the [Indenture/Credit Agreement];




          WHEREAS, pursuant to Section 1146(a) of the Bankruptcy Code, the making and delivery and
recordation of this Mortgage by Mortgagor is exempt from any and all stamp taxes, transfer taxes or
similar taxes, charges or expenses; and




          WHEREAS, Mortgagor, as a Subsidiary of one of the [Issuers/Borrowers] will benefit, directly
or indirectly, from credit and other financial accommodations extended by the Lenders to the
Borrowers, and as a condition to extending credit to [Issuers/Borrowers] under the
[Indenture/Credit Agreement], the Lenders have required, among other things, that Mortgagor execute
and deliver this Mortgage.




          NOW THEREFORE, in consideration of foregoing recitals, which are incorporated into the
operative provisions of this Mortgage by this reference, and for other good and valuable
consideration, the receipt and adequacy of which are hereby conclusively acknowledged, Mortgagor
hereby represents and warrants to and covenants and agrees with Mortgagee as follows:







H-2









 








ARTICLE 1

DEFINITIONS




          Section 1.1 Definitions. All capitalized terms used herein without definition shall
have the respective meanings ascribed to them in the [Indenture/Credit Agreement]. As used herein,
the following terms shall have the following meanings:




          (a) [insert in first lien mortgage only: “Collateral Agreement”: That certain
Collateral
Agreement, dated as of [ , 2009], by Issuer, the Guarantors named therein and the Additional
Grantors (as defined therein) to Agent.]




          (b) “Event of Default”: An Event of Default under and as defined in the [Indenture/Credit
Agreement].




          (c) [insert in second lien mortgage only: “Indenture”: That certain Indenture dated as
of [ ,
2009], as the same may be amended, amended and restated, supplemented or otherwise modified from
time to time, by and among Nortek, Inc., as issuer, the Guarantors party thereto and U.S. Bank
National Association, as trustee and collateral agent.]




          (d) [insert in second lien mortgage only: “Guaranty”: That certain U.S. Guaranty by and
from
Mortgagor and the other guarantors referred to therein for the benefit of the Secured Parties dated
as of even date herewith, as the same may hereafter be amended, amended and restated, supplemented
or otherwise modified from time to time.




          (e) “Indebtedness”: [First lien definition: Shall have the meaning ascribed to it in the
Indenture.] [Second lien definition: (1) All indebtedness of Mortgagor to Mortgagee or any of the
other Secured Parties under the Credit Agreement or any other Loan Document to which Mortgagor is a
party, including, without limitation (except as otherwise set forth in Section 1(b) of the
Guaranty), the sum of all (a) principal, interest and other amounts owing under or evidenced or
secured by the Loan Documents, (b) principal, interest and other amounts which may hereafter be
lent by Mortgagee or any of the other Secured Parties under or in connection with the Credit
Agreement or any of the other Loan Document, whether evidenced by a promissory note or other
instrument which, by its terms, is secured hereby, and (c) obligations and liabilities of any
nature now or hereafter existing under or arising in connection with Letters of Credit and other
extensions of credit under the Credit Agreement or any of the other Loan Documents and
reimbursement obligations in respect thereof, together with interest and other amounts payable with
respect thereto, and (2) all other indebtedness, obligations and liabilities now or hereafter
existing of any kind of Mortgagor to Mortgagee or any of the other Secured Parties under documents
which recite that they are intended to be secured by this Mortgage. The Indebtedness secured
hereby includes, without limitation, all interest and expenses accruing after the commencement by
or against Mortgagor or any of its affiliates of a proceeding under the Bankruptcy Code (defined
below) or any similar law for the relief of debtors. The Credit Agreement contains a revolving
credit facility which permits Borrower to borrow certain principal amounts, repay all or a portion
of such principal amounts, and reborrow the amounts previously paid to the Secured Parties, all
upon satisfaction of certain conditions stated in the Credit Agreement.] [use only if the Mortgage
is capped: Subject to the provisions of






H-3









 







Section 2.2, this] [This] Mortgage secures all
advances and re-advances under the Credit Agreement, including, without limitation, those under the revolving credit facility contained
therein].




          (f) “Mortgaged Property”: The fee interest in the real property described in Exhibit
A attached hereto and incorporated herein by this reference, together with any greater estate
therein as hereafter may be acquired by Mortgagor (the “Land”), and all of Mortgagor’s right, title
and interest now or hereafter acquired in and to (1) all improvements now owned or hereafter
acquired by Mortgagor, now or at any time situated, placed or constructed upon the Land (the
“Improvements”; the Land and Improvements are collectively referred to as the “Premises”), (2) all
materials, supplies, equipment, apparatus and other items of personal property now owned or
hereafter acquired by Mortgagor and now or hereafter attached to, installed in or used in
connection with any of the Improvements or the Land, and water, gas, electrical, telephone, storm
and sanitary sewer facilities and all other utilities whether or not situated in easements, and all
equipment, inventory and other goods in which Mortgagor now has or hereafter acquires any rights or
any power to transfer rights and that are or are to become fixtures (as defined in the UCC, defined
below) related to the Land (the “Fixtures”), (3) all goods, accounts, inventory, general
intangibles, instruments, documents, contract rights and chattel paper, including all such items as
defined in the UCC, now owned or hereafter acquired by Mortgagor and now or hereafter affixed to,
placed upon, used in connection with, arising from or otherwise related to the Premises (the
“Personalty”), (4) all reserves, escrows or impounds required under the [Indenture/Credit
Agreement] or any of the other [Note/Loan] Documents and all deposit accounts maintained by
Mortgagor with respect to the Mortgaged Property (the “Deposit Accounts”), (5) all leases,
licenses, concessions, occupancy agreements or other agreements (written or oral, now or at any
time in effect) which grant to any Person a possessory interest in, or the right to use, all or any
part of the Mortgaged Property, together with all related security and other deposits (the
“Leases”), (6) all of the rents, revenues, royalties, income, proceeds, profits, accounts
receivable, security and other types of deposits, and other benefits paid or payable by parties to
the Leases for using, leasing, licensing possessing, operating from, residing in, selling or
otherwise enjoying the Mortgaged Property (the “Rents”), (7) all other agreements, such as
construction contracts, architects’ agreements, engineers’ contracts, utility contracts,
maintenance agreements, management agreements, service contracts, listing agreements, guaranties,
warranties, permits, licenses, certificates and entitlements in any way relating to the
construction, use, occupancy, operation, maintenance, enjoyment or ownership of the Mortgaged
Property; to the extent such agreements and entitlements are assignable by their terms and without
the consent of any third party (the “Property Agreements”), (8) all rights, privileges, tenements,
hereditaments, rights-of-way, easements, appendages and appurtenances appertaining to the
foregoing, (9) all property tax refunds payable with respect to the Mortgaged Property (the “Tax
Refunds”), (10) all accessions, replacements and substitutions for any of the foregoing and all
proceeds thereof (the “Proceeds”), (11) all insurance policies, unearned premiums therefor and
proceeds from such policies covering any of the above property now or hereafter acquired by
Mortgagor (the “Insurance”), and (12) all awards, damages,
remunerations, reimbursements,
settlements or compensation heretofore made or hereafter to be made by any governmental authority
pertaining to any condemnation or other taking (or any purchase in lieu thereof) of all or any
portion of the Land, Improvements, Fixtures or Personalty (the “Condemnation Awards”). As used in
this Mortgage, the term “Mortgaged Property” shall mean all or, where the context permits or
requires, any portion of the above or any interest therein.







H-4









 








          (g) [insert in first lien mortgage only: “Note Documents” means the Indenture
(including the
Guarantees set forth therein), the Notes, the Collateral Agreement, this Mortgage, the other
Security Documents, the Intercreditor Agreement and the other documents and instruments executed
and delivered pursuant to the foregoing, as such documents and instruments may be amended, amended
and restated, supplemented or otherwise modified from time to time.]




          (h) “Obligations”: [insert in first lien mortgage only: Means (a) the Indebtedness
evidenced
by the Notes and all Obligations in respect thereof, including principal, premium (if any),
interest (including Additional Interest, if any, and interest accruing on or after the filing of
any petition in bankruptcy or for reorganization relating to the Issuer or any Guarantor whether or
not a claim for post- filing interest is allowed in such proceedings), fees, charges, expenses,
reimbursement obligations, Guarantees and all other amounts payable thereunder or in respect
thereof, and (b) any other obligations of the Issuer or any Guarantor under the Indenture or any
other Note Document.] [insert in second lien mortgage only: All of the agreements, covenants,
conditions, warranties, representations and other obligations of Mortgagor under the Credit
Agreement and the other Loan Documents to which it is a Party.]




          (i) “Permitted Liens”: [insert in first lien mortgage only: Shall have the meaning ascribed
to it in the Indenture.] [insert in second lien mortgage only: Liens permitted by clauses (a),
(b), (c), (d), (e), (g), (h), (k) and (s) of Section 7.01] of the Credit Agreement.




          (j) [insert in first lien mortgage only: “Secured Parties”: Means, collectively, (a) the
Holders, (b) the Trustee (c) the Agent (d) each other Person that holds, or is an obligee in
respect of, any Obligations, and (e) the successors and assigns of each of the foregoing.]




          (k) [insert in second lien mortgage only: “Security Agreement”: That certain U.S. Security
Agreement by and from Mortgagor and the other grantors referred to therein to Agent and the other
Secured Parties dated May [___], 2008, as the same may hereafter be amended, amended and restated,
supplemented or otherwise modified from time to time.]




          (l) “UCC”: The Uniform Commercial Code of
[                    ] or, if the creation, perfection and enforcement
of any security interest herein granted is governed by the laws of a state other than [                    ], then, as
to the matter in question, the Uniform Commercial Code in effect in that state.




ARTICLE 2

GRANT [insert only if the Mortgage is capped: ; REVOLVING LOAN];

INTERCREDITOR AGREEMENT




          Section 2.1 Grant. To secure the full and timely payment [and performance of the
Obligations / of the Indebtedness and the full and timely performance of the Obligations],
Mortgagor MORTGAGES, GRANTS, BARGAINS, ASSIGNS, SELLS, CONVEYS and CONFIRMS, to Mortgagee for the
ratable benefit of the Secured Parties, the Mortgaged Property, subject, however, only to [the
matters that are set forth on Exhibit B attached hereto (the “Permitted Encumbrances”) and
to] Permitted Liens, TO HAVE AND TO HOLD the






H-5









 







Mortgaged Property to Mortgagee, and Mortgagor does hereby bind itself, its successors and
assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee for the
ratable benefit of the Secured Parties.




          Section 2.2 Treatment of Borrowings and Repayments. [insert only in second lien
mortgage if the Mortgage is capped: Pursuant to the Credit Agreement, the amount of the
Indebtedness may increase and decrease from time to time as the Secured Parties advance, Borrower
repays, and the Secured Parties re-advance sums pursuant to the Credit Agreement.] [insert only if
the Mortgage is capped: For purposes of this Mortgage, so long as the balance of the Indebtedness
equals or exceeds the Secured Amount, the amount of the Indebtedness secured by this Mortgage shall
at all times equal only the Secured Amount. Such Secured Amount represents only a portion of the
first sums advanced by the Secured Parties in respect of the Indebtedness.]




          Section 2.3 Reduction of Secured Amount. [insert only if the Mortgage is capped: The
Secured Amount shall be reduced only by the last and final sums that Borrower repays with respect
to the [Obligations/Indebtedness] and shall not be reduced by any intervening repayments of the
[Obligations/Indebtedness]. So long as the balance of the [Obligations/Indebtedness] exceeds the
Secured Amount, any payments and repayments of the [Obligations/Indebtedness] shall not be deemed
to be applied against, or to reduce, the portion of the [Obligations/Indebtedness] secured by this
Mortgage. Such payments shall instead be deemed to reduce only such portions of the
[Obligations/Indebtedness] as are secured by other collateral located outside of the State of
[                    ].]




          Section 2.4 Intercreditor Agreement. Reference is made to the Lien Subordination and
Intercreditor Agreement dated as of [                    , 2009], among Bank of America, N.A., as Collateral Agent for
the Revolving Facility Secured Parties referred to therein; U.S. Bank National Association, as
Trustee and as Noteholder Collateral Agent; Nortek, Inc.; and the other subsidiaries of Nortek,
Inc. named therein (the “Intercreditor Agreement”). [insert in second lien mortgage only:
Notwithstanding any other provision contained herein, this Mortgage, the Liens created hereby and
the rights, remedies, duties and obligations provided for herein are subject in all respects to the
provisions of the Intercreditor Agreement and, to the extent provided therein, the applicable
Senior Secured Obligations Security Documents (as defined in the Intercreditor Agreement).] In the
event of any conflict or inconsistency between the provisions of this Mortgage and the
Intercreditor Agreement, the provisions of the Intercreditor Agreement shall control.




ARTICLE 3

WARRANTIES, REPRESENTATIONS AND COVENANTS




          Mortgagor warrants, represents and covenants to Mortgagee as follows:




          Section 3.1 Title to Mortgaged Property and Lien of this Instrument. Mortgagor owns
the Mortgaged Property free and clear of any liens, claims or interests, except [insert in second
lien mortgage only: the Permitted Encumbrances and] the Permitted Liens. This Mortgage creates
valid, enforceable [first priority] liens and security interests against the Mortgaged Property
[insert in first lien mortgage only: , except for Permitted Liens].







H-6









 








          Section 3.2 Lien Status. Mortgagor shall preserve and protect the [first] lien and
security interest priority of this Mortgage and the other [Note/Loan] Documents. If any lien or
security interest other than [a Permitted Encumbrance or] a Permitted Lien is asserted against the
Mortgaged Property, Mortgagor shall promptly, and at its expense, (a) give Mortgagee a detailed
written notice of such lien or security interest (including origin, amount and other terms), and
(b) pay the underlying claim in full or take such other action so as to cause it to be released or
contest the same in compliance with the requirements of the [Indenture/Credit Agreement] (including
the requirement of providing a bond or other security satisfactory to Mortgagee).




          Section 3.3 Payment and Performance. [insert in first lien mortgage only: Mortgagor
shall pay and perform the Obligations on its part to be performed in full when due under the
Indenture and the other Note Documents.] [Insert in second lien mortgage only: Mortgagor shall
pay the Indebtedness when due under the Credit Agreement and the other Loan Documents and shall
perform the Obligations on its part to be performed in full when they are required to be performed.




          Section 3.4 Replacement of Fixtures and Personalty. Mortgagor shall not, without the
prior written consent of Mortgagee, permit any of the Fixtures or Personalty owned or leased by
Mortgagor to be removed at any time from the Land or Improvements, unless the removed item is
removed temporarily for maintenance and repair or is permitted to be removed by the
[Indenture/Credit Agreement].




          Section 3.5 Inspection. Mortgagor shall permit Mortgagee and the other Secured
Parties and their respective agents, representatives and employees, upon reasonable prior notice to
Mortgagor, to inspect the Mortgaged Property and all books and records of Mortgagor located
thereon, and to conduct such environmental and engineering studies as Mortgagee or the other
Secured Parties may require, provided that such inspections and studies shall not materially
interfere with the use and operation of the Mortgaged Property.




          Section 3.6 Other Covenants. All of the covenants in the [Indenture/Credit Agreement]
are incorporated herein by reference and, together with covenants in this Article 3, shall
be covenants running with the Land.




          Section 3.7 Insurance; Condemnation Awards and Insurance Proceeds.




          (a) Insurance. Mortgagor shall maintain or cause to be maintained, with financially
sound and reputable insurers, insurance with respect to the Mortgaged Property against loss or
damage of the kinds customarily carried or maintained under similar circumstances by corporations
of established reputation engaged in similar businesses, in accordance with and to the extent
provided in the [Indenture/Credit Agreement]. Each such policy of insurance shall name Mortgagee
as the loss payee (or, in the case of liability insurance, an additional insured) thereunder for
the ratable benefit of the Secured Parties, shall (except in the case of liability insurance) name
Mortgagee as the “mortgagee” under a so-called “New York” long form non-contributory endorsement
(or equivalent endorsement) and shall provide for at least 30 days’ prior written notice of any
material modification or cancellation of such policy. In addition to the foregoing, if any portion
of the Mortgaged Property is located in an






H-7









 







area identified by the Federal Emergency Management Agency as an area having special flood
hazards and in which flood insurance has been made available under the National Flood Insurance Act
of 1968 (or any amendment or successor act thereto), then Mortgagor shall maintain, or cause to be
maintained, with a financially sound and reputable insurer, flood insurance in an amount, subject
to the maximum limits available under the Federal flood insurance program, sufficient to comply
with all applicable rules and regulations promulgated pursuant to such Act.




          (b) Condemnation Awards. [Insert in second lien mortgage only: Subject to the
provisions of that certain first lien Mortgage dated as of the date hereof among Mortgagor, and
U.S. Bank National Association (the “First Lien Mortgage”),] Mortgagor assigns all Condemnation
Awards to Mortgagee for the benefit of the Secured Parties and authorizes Mortgagee to collect and
receive such Condemnation Awards and to give proper receipts and acquittances therefor, subject to
the terms of the [Indenture/Credit Agreement].




          (c) Insurance Proceeds. [Insert in second lien mortgage only: Subject to the
provisions of the First Lien Mortgage,] Mortgagor assigns to Mortgagee for the benefit of the
Secured Parties all proceeds of any insurance policies insuring against loss or damage to the
Mortgaged Property. Subject to the terms of the [Indenture/Credit Agreement], Mortgagor authorizes
Mortgagee to collect and receive such proceeds and authorizes and directs the issuer of each of
such insurance policies to make payment for all such losses directly to Mortgagee, instead of to
Mortgagor and Mortgagee jointly.




          Section 3.8 Payment of Taxes and Other Obligations. Mortgagor will pay and discharge
from time to time prior to the time when the same shall become delinquent, and before any interest
or penalty accrues thereon or attaches thereto, all Taxes and other obligations with respect to the
Mortgaged Property or any part thereof or upon the Rents from the Mortgaged Property or arising in
respect of the occupancy, use or possession thereof in accordance with, and to the extent required
by, the [Indenture/Credit Agreement]. In the event of the passage of any state, Federal, municipal
or other governmental law, order, rule or regulation subsequent to the date hereof (i) deducting
from the value of real property for the purpose of taxation any lien or encumbrance thereon or in
any manner changing or modifying the laws now in force governing the taxation of this Mortgage or
debts secured by mortgages or mortgage (other than laws governing income, franchise and similar
taxes generally) or the manner of collecting taxes thereon and (ii) imposing a tax to be paid by
Mortgagee, either directly or indirectly, on this Mortgage or any of the [Note/Loan] Documents, or
requiring an amount of taxes to be withheld or deducted therefrom, Mortgagor will promptly (i)
notify Mortgagee of such event, (ii) enter into such further instruments as Mortgagee may determine
are reasonably necessary or desirable to obligate Mortgagor to make any additional payments
necessary to put the Secured Parties in the same financial position they would have been if such
law, order, rule or regulation had not been passed and (iii) make such additional payments to
Mortgagee for the benefit of the Secured Parties.




          Section 3.9 Filing and Recording. Mortgagor will cause this Mortgage, the UCC
financing statements referred to in Section 7.2 any other security instrument creating a security
interest in or evidencing the lien hereof upon the Mortgaged Property and each UCC continuation
statement and instrument of further assurance to be filed, registered or recorded






H-8









 







and, if necessary, refiled, rerecorded and reregistered in such manner and in such places as
may be required by any present or future law in order to publish notice of and fully to perfect the
lien hereof upon, and the security interest of Mortgagee in the Mortgaged Property until this
Mortgage is terminated and released in full in accordance with Section 9.7 hereof. Mortgagor will
pay all filing, registration and recording fees, all Federal, state, county and municipal
recording, documentary or intangible taxes and other taxes, duties, imposts, assessments and
charges, and all reasonable expenses incidental to or arising out of or in connection with the
execution, delivery and recording of this Mortgage, UCC continuation statements, any mortgage
supplemental hereto, any security instrument with respect to the Personal Property, Property
Agreements and Proceeds or any instrument of further assurance.




          Section 3.10 Additions to Mortgage Property. All right, title and interest of
Mortgagor in and to all extensions, improvements, betterments, renewals, substitutes and
replacements of, and all additions and appurtenances to, the Mortgaged Property hereafter acquired
by or released to Mortgagor or constructed, assembled or placed by Mortgagor upon the Premises or
the Improvements, and all conversions of the security constituted thereby, immediately upon such
acquisition, release, construction, assembling, placement or conversion, as the case may be, and in
each such case without any further mortgage, deed of trust, conveyance, assignment or other act by
Mortgagor, shall become subject to the lien and security interest of this Mortgage as fully and
completely and with the same effect as though now owned by Mortgagor and specifically described in
the grant of the Mortgaged Property above, but at any and all times Mortgagor will execute and
deliver to Mortgagee any and all such further assurances, mortgages, deeds, conveyances or
assignments thereof as Mortgagee may reasonably require for the purpose of expressly and
specifically subjecting the same to the lien and security interest of this Mortgage.




ARTICLE 4

[Intentionally Omitted]




ARTICLE 5

DEFAULT AND FORECLOSURE



          Section 5.1 Remedies. Upon the occurrence and during the continuance of an Event of
Default, Mortgagee may, at Mortgagee’s election, exercise any or all of the following rights,
remedies and recourses:




          (a) Acceleration. Subject to any provisions of the [Note/Loan] Documents providing
for the automatic acceleration of the [Obligations/Indebtedness] upon the occurrence of certain
Events of Default, declare the [Obligations/Indebtedness] to be immediately due and payable,
without further notice, presentment, protest, notice of intent to accelerate, notice of
acceleration, demand or action of any nature whatsoever (each of which hereby is expressly waived
by Mortgagor), whereupon the same shall become immediately due and payable.




          (b) Entry on Mortgaged Property. Enter the Mortgaged Property and take exclusive
possession thereof and of all books, records and accounts relating thereto or located thereon. If
Mortgagor remains in possession of the Mortgaged Property following the occurrence






H-9









 







and during the continuance of an Event of Default and without Mortgagee’s prior written
consent, Mortgagee may invoke any legal remedies to dispossess Mortgagor.




          (c) Operation of Mortgaged Property. Hold, lease, develop, manage, operate or
otherwise use the Mortgaged Property upon such terms and conditions as Mortgagee may deem
reasonable under the circumstances (making such repairs, alterations, additions and improvements
and taking other actions, from time to time, as Mortgagee deems necessary or desirable), and apply
all Rents and other amounts collected by Mortgagee in connection therewith in accordance with the
provisions of Section 5.7.




          (d) Foreclosure and Sale. Institute proceedings for the complete foreclosure of this
Mortgage by judicial action or by power of sale, in which case the Mortgaged Property may be sold
for cash or credit in one or more parcels as Mortgagee may determine. With respect to any notices
required or permitted under the UCC, Mortgagor agrees that ten (10) days’ prior written notice
shall be deemed commercially reasonable. At any such sale by virtue of any judicial proceedings,
power of sale, or any other legal right, remedy or recourse, the title to and right of possession
of any such property shall pass to the purchaser thereof, and to the fullest extent permitted by
law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest,
claim, equity, equity of redemption, and demand whatsoever, either at law or in equity, in and to
the property sold and such sale shall be a perpetual bar both at law and in equity against
Mortgagor, and against all other Persons claiming or to claim the property sold or any part
thereof, by, through or under Mortgagor. Mortgagee or any of the other Secured Parties may be a
purchaser at such sale. If Mortgagee or such other Secured Party is the highest bidder, Mortgagee
or such other Secured Party may credit the portion of the purchase price that would be distributed
to Mortgagee or such other Secured Party against the [Obligations/Indebtedness] in lieu of paying
cash. In the event this Mortgage is foreclosed by judicial action, appraisement of the Mortgaged
Property is waived.




          (e) Receiver. Make application to a court of competent jurisdiction for, and obtain
from such court as a matter of strict right and without notice to Mortgagor or regard to the
adequacy of the Mortgaged Property for the repayment of the [Obligations/Indebtedness], the
appointment of a receiver of the Mortgaged Property, and Mortgagor irrevocably consents to such
appointment. Any such receiver shall have all the usual powers and duties of receivers in similar
cases, including the full power to rent, maintain and otherwise operate the Mortgaged Property upon
such terms as may be approved by the court, and shall apply such Rents in accordance with the
provisions of Section 5.7.




          (f) Other. Exercise all other rights, remedies and recourses granted under the
[Note/Loan] Documents or otherwise available at law or in equity.




          Section 5.2 Separate Sales. The Mortgaged Property may be sold in one or more parcels
and in such manner and order as Mortgagee in its sole discretion may elect. The right of sale
arising out of any Event of Default shall not be exhausted by any one or more sales.




          Section 5.3 Remedies Cumulative, Concurrent and Nonexclusive. Mortgagee and the other
Secured Parties shall have all rights, remedies and recourses granted in the [Note/Loan] Documents
and available at law or equity (including the UCC), which rights (a)






H-10









 







shall be cumulative and concurrent, (b) may be pursued separately, successively or
concurrently against Mortgagor or others obligated under the [Note/Loan] Documents, or against the
Mortgaged Property, or against any one or more of them, at the sole discretion of Mortgagee or such
other Secured Party, as the case may be, (c) may be exercised as often as occasion therefor shall
arise, and the exercise or failure to exercise any of them shall not be construed as a waiver or
release thereof or of any other right, remedy or recourse, and (d) are intended to be, and shall
be, nonexclusive. No action by Mortgagee or any other Secured Party in the enforcement of any
rights, remedies or recourses under the [Note/Loan] Documents or otherwise at law or equity shall
be deemed to cure any Event of Default.




          Section 5.4 Release of and Resort to Collateral. Mortgagee may release, regardless of
consideration and without the necessity for any notice to or consent by the holder of any
subordinate lien on the Mortgaged Property, any part of the Mortgaged Property without, as to the
remainder, in any way impairing, affecting, subordinating or releasing the lien or security
interest created in or evidenced by the [Note/Loan] Documents or their priority with respect to the
Mortgaged Property. For payment of the [Obligations/Indebtedness], Mortgagee may resort to any
other security in such order and manner as Mortgagee may elect.




          Section 5.5 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest
extent permitted by law, Mortgagor hereby irrevocably and unconditionally waives and releases (a)
all benefit that might accrue to Mortgagor by virtue of any present or future statute of
limitations or law or judicial decision exempting the Mortgaged Property from attachment, levy or
sale on execution or providing for any stay of execution, exemption from civil process, redemption
or extension of time for payment, (b) all notices of any Event of Default or of any election by
Mortgagee to exercise or the actual exercise of any right, remedy or recourse provided for under
the [Note/Loan] Documents, and (c) any right to a marshalling of assets or a sale in inverse order
of alienation.




          Section 5.6 Discontinuance of Proceedings. If Mortgagee or any other Secured Party
shall have proceeded to invoke any right, remedy or recourse permitted under the [Note/Loan]
Documents and shall thereafter elect to discontinue or abandon it for any reason, Mortgagee or such
other Secured Party, as the case may be, shall have the unqualified right to do so and, in such an
event, Mortgagor, Mortgagee and the other Secured Parties shall be restored to their former
positions with respect to the Indebtedness, the Obligations, the [Note/Loan] Documents, the
Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee and
the other Secured Parties shall continue as if the right, remedy or recourse had never been
invoked, but no such discontinuance or abandonment shall waive any Event of Default which may then
exist or the right of Mortgagee or any other Secured Party thereafter to exercise any right, remedy
or recourse under the [Note/Loan] Documents for such Event of Default.




          Section 5.7 Application of Proceeds. The proceeds of any sale of, and the Rents and
other amounts generated by the holding, leasing, management, operation or other use of the
Mortgaged Property, shall be applied by Mortgagee (or the receiver, if one is appointed) in the
following order unless otherwise required by applicable law:







H-11









 








          (a) to the payment of the costs and expenses of taking possession of the Mortgaged Property
and of holding, using, leasing, repairing, improving and selling the same, including, without
limitation (1) receiver’s fees and expenses, including the repayment of the amounts evidenced by
any receiver’s certificates, (2) court costs, (3) attorneys’ and accountants’ fees and expenses,
and (4) costs of advertisement;




          (b) [to the payment and performance of the Obligations / to the payment of the Indebtedness
and performance of the Obligations] in such manner and order of preference as Mortgagee in its sole
discretion may determine; and




          (c) the balance, if any, to the Persons legally entitled thereto.




          Section 5.8 Occupancy After Foreclosure. Any sale of the Mortgaged Property or any
part thereof in accordance with Section 5.1(d) will divest all right, title and interest of
Mortgagor in and to the property sold. Subject to applicable law, any purchaser at a foreclosure
sale will receive immediate possession of the property purchased. If Mortgagor retains possession
of such property or any part thereof subsequent to such sale, Mortgagor will be considered a tenant
at sufferance of the purchaser, and will, if Mortgagor remains in possession after demand to
remove, be subject to eviction and removal, forcible or otherwise, with or without process of law.




          Section 5.9 Additional Advances and Disbursements; Costs of Enforcement.




          (a) Upon the occurrence and during the continuance of any Event of Default, Mortgagee and each
of the other Secured Parties shall have the right, but not the obligation, to cure such Event of
Default in the name and on behalf of Mortgagor. All sums advanced and expenses incurred at any
time by Mortgagee or any other Secured Party under this Section 5.9, or otherwise under
this Mortgage or any of the other [Note/Loan] Documents or applicable law, shall bear interest from
the date that such sum is advanced or expense incurred, to and including the date of reimbursement,
computed at the highest rate at which interest is then computed on any portion of the
[Obligations/Indebtedness], and all such sums, together with interest thereon, shall be secured by
this Mortgage.




          (b) Mortgagor shall pay all expenses (including reasonable attorneys’ fees and expenses) of or
incidental to the perfection and enforcement of this Mortgage and the other [Note/Loan] Documents,
or the enforcement, compromise or settlement of the [Obligations/Indebtedness] or any claim under
this Mortgage and the other [Note/Loan] Documents, and for the curing thereof, or for defending or
asserting the rights and claims of Mortgagee in respect thereof, by litigation or otherwise.




          Section 5.10 No Mortgagee in Possession. Neither the enforcement of any of the
remedies under this Article 5, the assignment of the Rents and Leases under Article
6, the security interests under Article 7, nor any other remedies afforded to Mortgagee
under the [Note/Loan] Documents, at law or in equity shall cause Mortgagee or any other Secured
Party to be deemed or construed to be a mortgagee in possession of the Mortgaged Property, to
obligate Mortgagee or any other Secured Party to lease the Mortgaged Property or attempt to do so,
or to






H-12









 







take any action, incur any expense, or perform or discharge any obligation, duty or liability
whatsoever under any of the Leases or otherwise.




ARTICLE 6

ASSIGNMENT OF RENTS AND LEASES




          Section 6.1 Assignment. In furtherance of and in addition to the assignment made by
Mortgagor in Section 2.1 of this Mortgage, Mortgagor hereby absolutely and unconditionally
assigns, sells, transfers and conveys to Mortgagee all of its right, title and interest in and to
all Leases, whether now existing or hereafter entered into, and all of its right, title and
interest in and to all Rents. This assignment is an absolute assignment and not an assignment for
additional security only. So long as no Event of Default shall have occurred and be continuing,
Mortgagor shall have a revocable license from Mortgagee to exercise all rights extended to the
landlord under the Leases, including the right to receive and collect all Rents and to hold the
Rents in trust for use in the payment and performance of the Obligations and to otherwise use the
same. The foregoing license is granted subject to the conditional limitation that no Event of
Default shall have occurred and be continuing. Upon the occurrence and during the continuance of
an Event of Default, whether or not legal proceedings have commenced, and without regard to waste,
adequacy of security for the Obligations or solvency of Mortgagor, the license herein granted shall
automatically expire and terminate, without notice to Mortgagor by Mortgagee (any such notice being
hereby expressly waived by Mortgagor to the extent permitted by applicable law).




          Section 6.2 Perfection Upon Recordation. Mortgagor acknowledges that Mortgagee has
taken all actions necessary to obtain, and that upon recordation of this Mortgage Mortgagee shall
have, to the extent permitted under applicable law, a valid and fully perfected, [first priority,]
present assignment of the Rents arising out of the Leases and all security for such Leases.
Mortgagor acknowledges and agrees that upon recordation of this Mortgage Mortgagee’s interest in
the Rents shall be deemed to be fully perfected, “choate” and enforced as to Mortgagor and to the
extent permitted under applicable law, all third parties, including, without limitation, any
subsequently appointed trustee in any case under Title 11 of the United States Code (the
“Bankruptcy Code”), without the necessity of commencing a foreclosure action with respect to this
Mortgage, making formal demand for the Rents, obtaining the appointment of a receiver or taking any
other affirmative action.




          Section 6.3 Bankruptcy Provisions. Without limitation of the absolute nature of the
assignment of the Rents hereunder, Mortgagor, and Mortgagee agree that (a) this Mortgage shall
constitute a “security agreement” for purposes of Section 552(b) of the Bankruptcy Code, (b) the
security interest created by this Mortgage extends to property of Mortgagor acquired before the
commencement of a case in bankruptcy and to all amounts paid as Rents and (c) such security
interest shall extend to all Rents acquired by the estate after the commencement of any case in
bankruptcy.




          Section 6.4 No Merger of Estates. So long as part of the Indebtedness and the
Obligations secured hereby remain unpaid and undischarged, the fee and leasehold estates to the
Mortgaged Property shall not merge, but shall remain separate and distinct, notwithstanding the






H-13









 







union of such estates either in Mortgagor, Mortgagee, any tenant or any third party by
purchase or otherwise.




ARTICLE 7

SECURITY AGREEMENT




          Section 7.1 Security Interest. This Mortgage constitutes a “security agreement” on
personal property within the meaning of the UCC and other applicable law and with respect to the
Personalty, Fixtures, Leases, Rents, Deposit Accounts, Property Agreements, Tax Refunds, Proceeds,
Insurance and Condemnation Awards. To this end, Mortgagor grants to Mortgagee a [first and prior]
security interest in the Personalty, Fixtures, Leases, Rents, Deposit Accounts, Property
Agreements, Tax Refunds, Proceeds, Insurance, Condemnation Awards and all other Mortgaged Property
which is personal property to secure the [payment and performance of the Obligations / payment of
the Indebtedness and performance of the Obligations], and agrees that Mortgagee shall have all the
rights and remedies of a secured party under the UCC with respect to such property. Any notice of
sale, disposition or other intended action by Mortgagee with respect to the Personalty, Fixtures,
Leases, Rents, Deposit Accounts, Property Agreements, Tax Refunds, Proceeds, Insurance and
Condemnation Awards sent to Mortgagor at least ten (10) days prior to any action under the UCC
shall constitute reasonable notice to Mortgagor. In the event of any conflict or inconsistency
between the terms of this Mortgage and the terms of the [Collateral Agreement / Security Agreement]
with respect to the collateral covered both therein and herein, the [Collateral Agreement /
Security Agreement] shall control and govern to the extent of any such conflict or inconsistency.




          Section 7.2 Financing Statements. Mortgagor shall prepare and deliver to Mortgagee
such financing statements, and shall execute and deliver to Mortgagee such other documents,
instruments and further assurances, in each case in form and substance satisfactory to Mortgagee,
as Mortgagee may, from time to time, reasonably consider necessary to create, perfect and preserve
Mortgagee’s security interest hereunder. Mortgagor hereby irrevocably authorizes Mortgagee to
cause financing statements (and amendments thereto and continuations thereof) and any such
documents, instruments and assurances to be recorded and filed, at such times and places as may be
required or permitted by law to so create, perfect and preserve such security interest. Mortgagor
represents and warrants to Mortgagee that Mortgagor’s jurisdiction of organization is the State of
[           ]. After the date of this Mortgage, Mortgagor shall not change its name, type of organization,
organizational identification number (if any), jurisdiction of organization or location (within the
meaning of the UCC) without giving at least thirty (30) days’ prior written notice to Mortgagee.




          Section 7.3 Fixture Filing. This Mortgage shall also constitute a “fixture filing”
for the purposes of the UCC against all of the Mortgaged Property which is or is to become
fixtures. The information provided in this Section 7.3 is provided so that this Mortgage
shall comply with the requirements of the UCC for a mortgage instrument to be filed as a financing
statement. Mortgagor is the “Debtor” and its name and mailing address are set forth in the
preamble of this Mortgage immediately preceding Article 1. Mortgagee is the “Secured
Party” and its name and mailing address from which information concerning the security interest
granted herein may be obtained are also set forth in the preamble of this Mortgage immediately
preceding Article 1. A statement describing the portion of the Mortgaged Property
comprising






H-14









 







the fixtures hereby secured is set forth in Section 1.1([e/f]) of this Mortgage.
Mortgagor represents and warrants to Mortgagee that Mortgagor is the record owner of the Mortgaged
Property, the employer identification number of Mortgagor is [                    ] and the organizational
identification number of Mortgagor is [                    ].




ARTICLE 8

[Intentionally Omitted]




ARTICLE 9

MISCELLANEOUS



          Section 9.1 Notices. Any notice required or permitted to be given under this Mortgage
shall be given in accordance with Section [12.02 / 11.02] of the [Indenture/Credit Agreement].




          Section 9.2 Covenants Running with the Land. All Obligations contained in this
Mortgage are intended by Mortgagor and Mortgagee to be, and shall be construed as, covenants
running with the Land. As used herein, “Mortgagor” shall refer to the party named in the first
paragraph of this Mortgage and to any subsequent owner of all or any portion of the Mortgaged
Property. All Persons who may have or acquire an interest in the Mortgaged Property shall be
deemed to have notice of, and be bound by, the terms of the [Indenture/Credit Agreement] and the
other [Note/Loan] Documents; provided, however, that no such party shall be entitled to any rights
thereunder without the prior written consent of Mortgagee.




          Section 9.3 Attorney-in-Fact. Mortgagor hereby irrevocably appoints Mortgagee as its
attorney-in-fact, which agency is coupled with an interest and with full power of substitution,
with full authority in the place and stead of Mortgagor and in the name of Mortgagor or otherwise
(a) to execute and/or record any notices of completion, cessation of labor or any other notices
that Mortgagee deems appropriate to protect Mortgagee’s interest, if Mortgagor shall fail to do so
within ten (10) days after written request by Mortgagee, (b) upon the issuance of a deed pursuant
to the foreclosure of this Mortgage or the delivery of a deed in lieu of foreclosure, to execute
all instruments of assignment, conveyance or further assurance with respect to the Leases, Rents,
Deposit Accounts, Property Agreements, Tax Refunds, Proceeds, Insurance and Condemnation Awards in
favor of the grantee of any such deed and as may be necessary or desirable for such purpose, (c) to
prepare and file or record financing statements and continuation statements, and to prepare,
execute and file or record applications for registration and like papers necessary to create,
perfect or preserve Mortgagee’s security interests and rights in or to any of the Mortgaged
Property, and (d) after the occurrence and during the continuance of any Event of Default, to
perform any obligation of Mortgagor hereunder; provided, however, that (1) Mortgagee shall not
under any circumstances be obligated to perform any obligation of Mortgagor; (2) any sums advanced
by Mortgagee in such performance shall be added to and included in the [Obligations/Indebtedness]
and shall bear interest at the highest rate at which interest is then computed on any portion of
the [Obligations/Indebtedness]; (3) Mortgagee as such attorney-in-fact shall only be accountable
for such funds as are actually received by Mortgagee; and (4) Mortgagee shall not be liable to
Mortgagor or any other person or entity for any failure to take any action which it is empowered to
take under this Section 9.3.







H-15









 








          Section 9.4 Successors and Assigns. This Mortgage shall be binding upon and inure to
the benefit of Mortgagee, the other Secured Parties, and Mortgagor and their respective successors
and assigns. Mortgagor shall not, without the prior written consent of Mortgagee, assign any
rights, duties or obligations hereunder, except as permitted by the [Indenture/Credit Agreement].




          Section 9.5 No Waiver. Any failure by Mortgagee and the other Secured Parties to
insist upon strict performance of any of the terms, provisions or conditions of the [Note/Loan]
Documents shall not be deemed to be a waiver of same, and Mortgagee and the other Secured Parties
shall have the right at any time to insist upon strict performance of all of such terms, provisions
and conditions.




          Section 9.6 [Indenture/Credit Agreement]. If any conflict or inconsistency exists
between this Mortgage and the [Indenture/Credit Agreement], the [Indenture/Credit Agreement] shall
control and govern to the extent of any such conflict or inconsistency.




          Section 9.7 Release or Reconveyance. [Insert in first lien mortgage only: Upon any
sale, lease, transfer or other disposition of any item of Mortgaged Property of Mortgagor permitted
by, and in accordance with, the terms of the Note Documents, or upon the effectiveness of any
consent to the release of the security interest granted hereby in any Mortgaged Property pursuant
to Article IX of the Indenture, or upon the release of Mortgagor from its obligations under the
applicable Guarantee, if any, in accordance with the terms of the Note Documents, the Mortgagee
will, at Mortgagor’s expense, execute and deliver to Mortgagor such documents as Mortgagor shall
reasonably request to evidence the release of such item of Mortgaged Property from the lien and
security interest granted hereby; provided, however, that (i) at the time of such request and such
release no Default shall have occurred and be continuing and (ii) Mortgagor shall have delivered to
Mortgagee, at least ten Business Days prior to the date of the proposed release, a written request
for release describing the item of Mortgaged Property and the terms of the sale, lease, transfer or
other disposition in reasonable detail, including, without limitation, the price thereof and any
expenses in connection therewith, together with a form of release for execution by the Mortgagee
and a certificate of Mortgagor to the effect that the transaction is in compliance with the Note
Documents and as to such other matters as the Mortgagee may request and (iii) the proceeds of any
such sale, lease, transfer or other disposition required to be applied, or any payment to be made
in connection therewith, in accordance with Section 4.13 of the Indenture shall, to the extent so
required, be paid or made to, or in accordance with the instructions of, the Mortgagee when and as
required under Section 4.13 of the Indenture.



Upon the payment in full of all Obligations (other than contingent indemnification obligations),
the lien and security interest granted hereby shall terminate and all rights to the Mortgaged
Property shall revert to the Mortgagor. Upon any such termination, Mortgagee will, at the
Mortgagor’s expense, execute and deliver to Mortgagor such documents as Mortgagor shall reasonably
request to evidence such termination.]



[Insert in second lien mortgage only: Upon payment in full of the Indebtedness and performance in
full of the Obligations and the termination or expiration of all Commitments or upon a sale or
other disposition of the Mortgaged Property permitted by the Credit Agreement, the lien and
security interest granted hereby shall terminate and all rights to the Mortgaged






H-16









 







Property shall revert to the Mortgagor. Upon any such termination, Mortgagee, at Mortgagor’s
request and expense, shall release the liens and security interests created by this Mortgage or
reconvey the Mortgaged Property to Mortgagor.]




          Section 9.8 Waiver of Stay, Moratorium and Similar Rights. Mortgagor agrees, to the
full extent that it may lawfully do so, that it will not at any time insist upon or plead or in any
way take advantage of any stay, marshalling of assets, extension, redemption or moratorium law now
or hereafter in force and effect so as to prevent or hinder the enforcement of the provisions of
this Mortgage or the Indebtedness or Obligations secured hereby, or any agreement between Mortgagor
and Mortgagee or any rights or remedies of Mortgagee or any other Secured Party.




          Section 9.9 Applicable Law. The provisions of this Mortgage regarding the creation,
perfection and enforcement of the liens and security interests herein granted shall be governed by
and construed under the laws of the state in which the Mortgaged Property is located. All other
provisions of this Mortgage shall be governed by the laws of the State of New York (including,
without limitation, Section 5-1401 of the General Obligations Law of the State of New York).




          Section 9.10 Headings. The Article, Section and Subsection titles hereof are inserted
for convenience of reference only and shall in no way alter, modify or define, or be used in
construing, the text of such Articles, Sections or Subsections.




          Section 9.11 Severability. If any provision of this Mortgage shall be held by any
court of competent jurisdiction to be unlawful, void or unenforceable for any reason, such
provision shall be deemed severable from and shall in no way affect the enforceability and validity
of the remaining provisions of this Mortgage.




          Section 9.12 Entire Agreement. This Mortgage and the other [Note/Loan] Documents
embody the entire agreement and understanding between Mortgagor and Mortgagee relating to the
subject matter hereof and thereof and supersede all prior agreements and understandings between
such parties relating to the subject matter hereof and thereof. Accordingly, the [Note/Loan]
Documents may not be contradicted by evidence of prior, contemporaneous or subsequent oral
agreements of the parties. There are no unwritten oral agreements between the parties.




          Section 9.13 Mortgagee as Agent; Successor Agents.




          (a) Agent has been appointed to act as Agent hereunder by the other Secured Parties. Agent
shall have the right hereunder to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking any action (including, without
limitation, the release or substitution of the Mortgaged Property) in accordance with the terms of
the [Indenture/Credit Agreement], any related agency agreement among Agent and the other Secured
Parties (collectively, as amended, amended and restated, supplemented or otherwise modified or
replaced from time to time, the “Agency Documents”) and this Mortgage. Mortgagor and all other
Persons shall be entitled to rely on releases, waivers, consents,






H-17









 







approvals, notifications and other acts of Agent, without inquiry into the existence of
required consents or approvals of the Secured Parties therefor.




          (b) Mortgagee shall at all times be the same Person that is Agent under the Agency Documents.
Written notice of resignation by Agent pursuant to the Agency Documents shall also constitute
notice of resignation as Agent under this Mortgage. Removal of Agent pursuant to any provision of
the Agency Documents shall also constitute removal as Agent under this Mortgage. Appointment of a
successor Agent pursuant to the Agency Documents shall also constitute appointment of a successor
Agent under this Mortgage. Upon the acceptance of any appointment as Agent by a successor Agent
under the Agency Documents, that successor Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring or removed Agent as the Mortgagee
under this Mortgage, and the retiring or removed Agent shall promptly (i) assign and transfer to
such successor Agent all of its right, title and interest in and to this Mortgage and the Mortgaged
Property, and (ii) execute and deliver to such successor Agent such assignments and amendments and
take such other actions, as may be necessary or appropriate in connection with the assignment to
such successor Agent of the liens and security interests created hereunder, whereupon such retiring
or removed Agent shall be discharged from its duties and obligations under this Mortgage. After
any retiring or removed Agent’s resignation or removal hereunder as Agent, the provisions of this
Mortgage and the Agency Documents shall inure to its benefit as to any actions taken or omitted to
be taken by it under this Mortgage while it was Agent hereunder.




          Section 9.14 Multisite Real Estate Transaction. Mortgagor acknowledges that this
Mortgage is one of a number of other mortgages, deed of trust and/or deeds to secure debt (the
“Other Mortgages”) and Security Documents that secure the Obligations. Mortgagor agrees that the
lien of this Mortgage shall be absolute and unconditional and shall not in any manner be affected
or impaired by any acts or omissions whatsoever of Mortgagee, and without limiting the generality
of the foregoing, the lien hereof shall not be impaired by any acceptance by the Mortgagee of any
security for or guarantees of any of the Obligations hereby secured, or by any failure, neglect or
omission on the part of Mortgagee to realize upon or protect any Obligation or indebtedness hereby
secured or any collateral security therefor including the Other Mortgages and other Security
Documents. The lien hereof shall not in any manner be impaired or affected by any release (except
as to the property released), sale, pledge, surrender, compromise, settlement, renewal, extension,
indulgence, alteration, changing, modification or disposition of any of the Obligations secured or
of any of the collateral security therefor, including the Other Mortgages and other Security
Documents or of any guarantee thereof, and Mortgagee may at its discretion foreclose, exercise any
power of sale, or exercise any other remedy available to it under any or all of the Other Mortgages
and other Security Documents without first exercising or enforcing any of its rights and remedies
hereunder. Such exercise of Mortgagee’s rights and remedies under any or all of the Other
Mortgages and other Security Documents shall not in any manner impair the indebtedness hereby
secured or the lien of this Mortgage and any exercise of the rights or remedies of Mortgagee
hereunder shall not impair the lien of any of the Other Mortgages and other Security Documents or
any of Mortgagee’s rights and remedies thereunder. Mortgagor specifically consents and agrees that
Mortgagee may exercise its rights and remedies hereunder and under the Other Mortgages and other
Security Documents separately or concurrently and in any order that it may deem appropriate and
waives any rights of subrogation.







H-18









 








ARTICLE 10

LOCAL LAW PROVISIONS




[To Come]


[insert in second lien mortgage only:




ARTICLE 11

SUBORDINATION




          The liens and security interests created by this Mortgage shall be, until such time as all
Noteholder Obligations (as defined in the Intercreditor Agreement) have been satisfied in full, a
second priority lien (subject to [Permitted Encumbrances and] other Permitted Liens), subordinate
in all respects (including the exercise of remedies with respect to the Mortgaged Property covered
hereby) to the prior lien of the applicable Mortgage (as defined in the Indenture) on and subject
to the terms and conditions set forth in the Intercreditor Agreement.]




[The remainder of this page has been intentionally left blank]









H-19









 








          IN WITNESS WHEREOF, Mortgagor has on the date set forth in the acknowledgement hereto,
effective as of the date first above written, caused this instrument to be duly EXECUTED AND
DELIVERED by authority duly given.




	 	 	 	 	 
	          MORTGAGOR:	 [              
                   
       ],


a [                    ]
[                    ]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 








H-20









 







[Insert State specific form of notary acknowledgement]





H-21











 








EXHIBIT I




FORM OF INTERCOMPANY NOTE








Form of Intercompany Note

I-1









 








EXHIBIT J




[RESERVED]








[Reserved]

J-1









 








EXHIBIT K




[RESERVED]






[Reserved]

K-1









 








EXHIBIT L




FORM OF BORROWING BASE CERTIFICATE







U.S. Borrowing Base







	 	 	 

	Customer Name: Nortek, Inc.

	 	 
	 
	Assignment #:
	 	 
	 
	Report Date:
	 	 
	 












	 	 	 	 	 	 	 	 

	 	ACCOUNTS RECEIVABLE	 
	 	Loan #

Dates Covered:
	 	 	 	 	 	 
	 	Collateral
	 	 	 	 	 	 
	 	1. Beginning Balance
	 	 	 	 	 	 
	 	2. Sales (+)
	 	 	 	 	 	 
	 	3. Credit Memos (-)
	 	 	 	 	 	 
	 	4. Adjustments (+)
	 	 	 	 	 	 
	 	5. Adjustments (-)
	 	 	 	 	 	 
	 	6. Net Collections — Includes Non A/R Cash (-)
	 	 	 	 	 	 
	 	7. Discounts (-)
	 	 	 	 	 	 
	 	8. Non A/R Cash (+)
	 	 	 	 	 	 
	 	9. Unapplied Cash (-)
	 	 	 	 	 	 
	 	10. Current Balance
	 	 	 	 	 	 
	 	11. Ineligible
	 	 	 	 	 	 
	 	12. Eligible U.S. Accounts Receivable (10-11)
	 	 	 	 	 	 
	 	13. Eligible A/R@85%
	 	 	 	 	 	 
	 	14. Less applicable Availability Reserve
	 	 	 	 	 	 
	 	15. Qualified U.S. Eligible Accounts Receivable
	 	 	 	 	 	 
	 





	 	 	 	 	 	 	 	 

	 	U.S. REVOLVING CREDIT LOANS	 
	 	1. Beginning Balance
	 	 	 	 	 	 
	 	2. Cash (Checks/ACH) (-)
	 	 	 	 	 	 
	 	3. Cash (Wire) (-)
	 	 	 	 	 	 
	 	4. Adjustments (-/+) (circle one)
	 	 	 	 	 	 
	 	5. Advance (+)
	 	 	 	 	 	 
	 	6. Current U.S. Revolving Credit Loan Balance @
	 	 	 	 	 	 
	 





	 	 	 	 	 	 	 	 

	 	AVAILABLE U.S. CASH COLLATERAL
	 	 	 	 	 	 
	 	1. Beginning Balance
	 	 	 	 	 	 
	 	2. Adjustments (+)
	 	 	 	 	 	 
	 	3. Adjustments (-)
	 	 	 	 	 	 
	 	4. Availability = Lesser of #1 and $25MM [1]
	 	 	 	 	 	 
	 








	 	 	 	 	 	 	 	 

	 	INVENTORY	 
	 	1. Beginning Balance
	 	 	 	 	 	 
	 	2. Adjustments (+)
	 	 	 	 	 	 
	 	3. Adjustments (-)
	 	 	 	 	 	 
	 	4. Current Balance
	 	 	 	 	 	 
	 	5. Ineligibles
	 	 	 	 	 	 
	 	6. Eligible U.S. Inventory (4-5)
	 	 	 	 	 	 
	 	7. Eligible U.S. Inventory @85% NOLV
	 	 	 	 	 	 
	 	8. Less applicable Availability Reserve
	 	 	 	 	 	 
	 	9. Qualified U.S. Eligible Inventory
	 	 	 	 	 	 
	 





	 	 	 	 	 	 	 	 

	 	TOTAL AVAILABILITY	 
	 	1. Qualified U.S. Eligible A/R
	 	 	 	 	 	 
	 	2. Qualified U.S. Eligible Inventory
	 	 	 	 	 	 
	 	3. Available U.S. Cash Collateral
	 	 	 	 	 	 
	 	 	 
	 	U.S. Borrowing Base (1+2+3)
	 	 	 	 	 	 
	 	 
	 	 	 	 	 	 
	 	Total U.S. Availability [2]
	 	 	 	 	 	 
	 	Less Total U.S. Revolving Credit
	 	 	 	 	 	 
	 	Loan Balance
	 	 	 	 	 	 
	 	Less U.S. Letters of Credit
	 	 	 	 	 	 
	 	Total U.S. Excess Availability
	 	 	 	 	 	 
	 











The foregoing information is delivered to Bank of America Business Capital in
accordance with a Credit Agreement between BANK OF AMERICA, N.A. and Nortek,
Inc.
Dated: December [___], 2009



I hereby certify that the information contained herein is true and correct in
all material respects as of the dates shown herein. Nothing contained herein
shall constitute a waiver, modification, or limitation of any of the terms or
conditions set forth in the Credit Agreement or any other Loan Document.




Brackets are not necessary for negative numbers

Unless what you want is different than what field indicates







	 	 	 

	Prepared by:

	 	 
	 
	 
	 	 
	Title:

	 	Date:
	 
	 
	 	 
	Approved by:
	 	 
	 
	 
	 	 
	Title:

	 	Date:
	 









[1] Less the amount of Canadian Available Cash included in the calculation of the Canadian Borrowing Base at such time;
$25M for purposes of determining whether a Borrowing is permitted for $10MM for any other purpose.



[2] Lesser of $230MM and the U.S. Borrowing Base.







L-1









 








EXHIBIT M-1




FORM OF PERFECTION CERTIFICATE



Form of
Perfection Certificate





M-1-1









 








EXHIBIT N




FORM OF APPROVED PLAN OF REORGANIZATION





Form of Approved Plan of Reorganization

N-1