Exhibit 10.1


 


EXECUTION COPY




 








 


CREDIT AGREEMENT


 


dated as of


 


August 16, 2005


 


among

CF INDUSTRIES HOLDINGS, INC.,

as a Loan Guarantor,


 


CF INDUSTRIES, INC.,

as Borrower,


 


The Subsidiary Guarantors Party
Hereto,

as Loan Guarantors,


 


The Lenders Party Hereto


 


and


 


JPMORGAN CHASE BANK, N.A.,

as Administrative Agent


 










 


J.P. MORGAN SECURITIES INC.,

as Sole Bookrunner,


 


J.P. MORGAN SECURITIES INC. and

HARRIS NESBITT,

as Co-Lead Arrangers


 


HARRIS N.A. and

GENERAL ELECTRIC CAPITAL CORPORATION,

as Co-Syndication Agents,


 


and


 


CITICORP USA, INC. and

BANK OF AMERICA, N.A.,

as Co-Documentation Agents




 





 





















 


TABLE
OF CONTENTS


 


 


	
  ARTICLE I.
  DEFINITIONS

  	
   

  
	
   

  	
   

  
	
  Section 1.01

  	
  Defined Terms

  	
   

  
	
  Section 1.02

  	
  Classification of Loans and Borrowings

  	
   

  
	
  Section 1.03

  	
  Terms Generally

  	
   

  
	
  Section 1.04

  	
  Accounting Terms; GAAP

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II.
  The Credits

  	
   

  
	
   

  	
   

  
	
  Section 2.01

  	
  The Facility

  	
   

  
	
  Section 2.02

  	
  Revolving Loans

  	
   

  
	
  Section 2.03

  	
  Loans and Borrowings

  	
   

  
	
  Section 2.04

  	
  Requests for Revolving Borrowings

  	
   

  
	
  Section 2.05

  	
  Protective Advances

  	
   

  
	
  Section 2.06

  	
  Swingline Loans

  	
   

  
	
  Section 2.07

  	
  Letters of Credit

  	
   

  
	
  Section 2.08

  	
  Funding of Borrowings

  	
   

  
	
  Section 2.09

  	
  Interest Elections

  	
   

  
	
  Section 2.10

  	
  Termination and Reduction of Commitments

  	
   

  
	
  Section 2.11

  	
  Repayment of Loans; Evidence of Debt

  	
   

  
	
  Section 2.12

  	
  Prepayment of Loans

  	
   

  
	
  Section 2.13

  	
  Fees

  	
   

  
	
  Section 2.14

  	
  Interest

  	
   

  
	
  Section 2.15

  	
  Alternate Rate of Interest

  	
   

  
	
  Section 2.16

  	
  Increased Costs

  	
   

  
	
  Section 2.17

  	
  Break Funding Payments

  	
   

  
	
  Section 2.18

  	
  Taxes

  	
   

  
	
  Section 2.19

  	
  Payments Generally; Allocation of Proceeds;
  Sharing of Set-offs

  	
   

  
	
  Section 2.20

  	
  Mitigation Obligations; Replacement of
  Lenders

  	
   

  
	
  Section 2.21

  	
  Returned Payments

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III.
  Representations and Warranties

  	
   

  
	
   

  	
   

  
	
  Section 3.01

  	
  Organization; Powers

  	
   

  
	
  Section 3.02

  	
  Authorization; Enforceability

  	
   

  
	
  Section 3.03

  	
  Governmental Approvals; No Conflicts

  	
   

  
	
  Section 3.04

  	
  Financial Condition; No Material Adverse
  Change

  	
   

  
	
  Section 3.05

  	
  Properties

  	
   

  
	
  Section 3.06

  	
  Litigation and Environmental Matters

  	
   

  
	
  Section 3.07

  	
  Compliance with Laws and Agreements

  	
   

  
	
  Section 3.08

  	
  Investment and Holding Company Status

  	
   

  
	
  Section 3.09

  	
  Taxes

  	
   

  



 


i





















 


	
  Section 3.10

  	
  ERISA

  	
   

  
	
  Section 3.11

  	
  Disclosure

  	
   

  
	
  Section 3.12

  	
  Material Agreements

  	
   

  
	
  Section 3.13

  	
  Solvency

  	
   

  
	
  Section 3.14

  	
  Reportable Transaction

  	
   

  
	
  Section 3.15

  	
  Capitalization and Subsidiaries

  	
   

  
	
  Section 3.16

  	
  Common Enterprise

  	
   

  
	
  Section 3.17

  	
  Labor Disputes

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV.
  Conditions

  	
   

  
	
   

  	
   

  
	
  Section 4.01

  	
  Effective Date

  	
   

  
	
  Section 4.02

  	
  Each Credit Event

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V.
  Affirmative Covenants

  	
   

  
	
   

  	
   

  
	
  Section 5.01

  	
  Financial Statements; Borrowing Base and
  Other Information

  	
   

  
	
  Section 5.02

  	
  Notices of Material Events

  	
   

  
	
  Section 5.03

  	
  Existence; Conduct of Business

  	
   

  
	
  Section 5.04

  	
  Payment of Obligations

  	
   

  
	
  Section 5.05

  	
  Maintenance of Properties and Intellectual
  Property Rights

  	
   

  
	
  Section 5.06

  	
  Books and Records; Inspection Rights

  	
   

  
	
  Section 5.07

  	
  Compliance with Laws

  	
   

  
	
  Section 5.08

  	
  Use of Proceeds and Letters of Credit

  	
   

  
	
  Section 5.09

  	
  Insurance

  	
   

  
	
  Section 5.10

  	
  Appraisals

  	
   

  
	
  Section 5.11

  	
  Additional Collateral; Further Assurances

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI.
  Negative Covenants

  	
   

  
	
   

  	
   

  
	
  Section 6.01

  	
  Indebtedness

  	
   

  
	
  Section 6.02

  	
  Liens

  	
   

  
	
  Section 6.03

  	
  Fundamental Changes

  	
   

  
	
  Section 6.04

  	
  Investments, Loans, Advances, Guarantees
  and Acquisitions

  	
   

  
	
  Section 6.05

  	
  Swap Agreements

  	
   

  
	
  Section 6.06

  	
  Restricted Payments

  	
   

  
	
  Section 6.07

  	
  Transactions with Affiliates

  	
   

  
	
  Section 6.08

  	
  Restrictive Agreements

  	
   

  
	
  Section 6.09

  	
  Prepayment of Indebtedness; Subordinated
  Indebtedness

  	
   

  
	
  Section 6.10

  	
  Depository Banks

  	
   

  
	
  Section 6.11

  	
  Capital Expenditures

  	
   

  
	
  Section 6.12

  	
  Fixed Charge Coverage Ratio

  	
   

  
	
  Section 6.13

  	
  Parent; Immaterial Subsidiaries

  	
   

  



 


ii





















 


	
  ARTICLE VII.
  Events of Default

  	
   

  
	
   

  	
   

  
	
  ARTICLE VIII.
  The Administrative Agent

  	
   

  
	
   

  	
   

  
	
  ARTICLE IX. Miscellaneous

  	
   

  
	
   

  	
   

  
	
  Section 9.01

  	
  Notices

  	
   

  
	
  Section 9.02

  	
  Waivers; Amendments

  	
   

  
	
  Section 9.03

  	
  Expenses; Indemnity; Damage Waiver

  	
   

  
	
  Section 9.04

  	
  Successors and Assigns

  	
   

  
	
  Section 9.05

  	
  Survival

  	
   

  
	
  Section 9.06

  	
  Counterparts; Integration; Effectiveness

  	
   

  
	
  Section 9.07

  	
  Severability

  	
   

  
	
  Section 9.08

  	
  Right of Setoff

  	
   

  
	
  Section 9.09

  	
  Governing Law; Jurisdiction; Consent to
  Service of Process

  	
   

  
	
  Section 9.10

  	
  WAIVER OF JURY TRIAL

  	
   

  
	
  Section 9.11

  	
  Headings

  	
   

  
	
  Section 9.12

  	
  Confidentiality

  	
   

  
	
  Section 9.13

  	
  Several Obligations; Nonreliance; Violation
  of Law

  	
   

  
	
  Section 9.14

  	
  USA PATRIOT Act

  	
   

  
	
  Section 9.15

  	
  Disclosure

  	
   

  
	
  Section 9.16

  	
  Execution of Loan Documents

  	
   

  
	
  Section 9.17

  	
  Interest Rate Limitation

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X. Loan Guaranty

  	
   

  
	
   

  	
   

  
	
  Section 10.01

  	
  Guaranty

  	
   

  
	
  Section 10.02

  	
  Guaranty of Payment

  	
   

  
	
  Section 10.03

  	
  No Discharge or Diminishment of Loan Guaranty

  	
   

  
	
  Section 10.04

  	
  Defenses Waived

  	
   

  
	
  Section 10.05

  	
  Rights of Subrogation

  	
   

  
	
  Section 10.06

  	
  Reinstatement; Stay of Acceleration

  	
   

  
	
  Section 10.07

  	
  Information

  	
   

  
	
  Section 10.08

  	
  Termination

  	
   

  
	
  Section 10.09

  	
  [Intentionally Omitted]

  	
   

  
	
  Section 10.10

  	
  Maximum
  Liability

  	
   

  
	
  Section 10.11

  	
  Contribution

  	
   

  
	
  Section 10.12

  	
  Liability Cumulative

  	
   

  



 


iii





















 


	
  SCHEDULES:

  	
   

  
	
   

  	
   

  
	
  Commitment Schedule

  	
   

  
	
  Schedule 1.01(a) — Affiliated
  Cooperatives

  	
   

  
	
  Schedule 1.01(c) — Donaldsonville
  Real Estate

  	
   

  
	
  Schedule 1.01(d) — Eligible Other
  Real Property

  	
   

  
	
  Schedule 1.01(e) — Noteholders
  Documents; Note Agreement Amendments

  	
   

  
	
  Schedule 3.05(a) — Properties

  	
   

  
	
  Schedule 3.06 — Disclosed Matters

  	
   

  
	
  Schedule 3.12 — Material Agreements

  	
   

  
	
  Schedule 3.15 — Capitalization and
  Subsidiaries

  	
   

  
	
  Schedule 3.17 — Labor Matters

  	
   

  
	
  Schedule 6.01 — Existing Indebtedness

  	
   

  
	
  Schedule 6.02(b) — Existing Liens

  	
   

  
	
  Schedule 6.02(h) — Phosphogypsum
  Liability Deposit Schedule

  	
   

  
	
  Schedule 6.03 — Permitted Dispositions

  	
   

  
	
  Schedule 6.04 — Existing Investments

  	
   

  
	
  Schedule 6.07 — Existing Transactions
  With Affiliates

  	
   

  
	
  Schedule 6.08 — Existing Restrictions

  	
   

  
	
   

  	
   

  
	
  EXHIBITS:

  	
   

  
	
   

  	
   

  
	
  Exhibit A — Form of Assignment
  and Assumption

  	
   

  
	
  Exhibit B — Form of Mortgage

  	
   

  
	
  Exhibit C — Form of Borrowing
  Base Certificate

  	
   

  
	
  Exhibit D — Closing Checklist

  	
   

  
	
  Exhibit E — Form of Compliance
  Certificate

  	
   

  
	
  Exhibit F — Joinder Agreement

  	
   

  
	
  Exhibit G — Financial Statements

  	
   

  



 


iv





















 


CREDIT AGREEMENT dated as of August 16,
2005 (as it may be amended or modified from time to time, this “Agreement”),
among CF INDUSTRIES HOLDINGS, INC., a Delaware corporation (“Parent”),
as a Loan Guarantor, the other Loan Guarantors party hereto, CF INDUSTRIES,
INC., a Delaware corporation (the “Borrower”), the Lenders party hereto
and JPMORGAN CHASE BANK, N.A., as Administrative Agent.


 


The parties hereto agree as follows:


 


ARTICLE I.


 


DEFINITIONS


 


Section 1.01           Defined
Terms.  As used in this Agreement,
the following terms have the meanings specified below:


 


“ABR”, when used in reference to any
Loan or Borrowing, means such Loan, or the Loans comprising such Borrowing, are
bearing interest at a rate determined by reference to the Alternate Base Rate.


 


“Account” has the meaning assigned in Article 9
of the UCC.


 


“Account Debtor” means any Person
obligated on an Account.


 


“Acquisition” means a transaction or
series of related transactions for the purpose of or resulting, directly or
indirectly, in (a) the acquisition of all or substantially all of the
assets of a Person, or of any division of a Person, (b) the acquisition of
in excess of 50% of the capital stock, partnership interests, membership
interests or equity of any Person, or otherwise causing any Person to become a
Subsidiary, or (c) a merger or consolidation or any other combination with
another Person (other than a Person that is a Subsidiary) provided that
Borrower or a Subsidiary of Borrower is the surviving entity.


 


“Adjusted LIBO Rate” means, with
respect to any Eurodollar Borrowing for any Interest Period, an interest rate
per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to (a) the
LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve
Rate.


 


“Administrative Agent” means JPMorgan
Chase Bank, N.A., in its capacity as administrative agent for the Lenders
hereunder, or its successor appointed pursuant to Article VIII.


 


“Administrative Questionnaire” means
an Administrative Questionnaire in a form supplied by the Administrative Agent.


 


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


 


“Affiliated Cooperatives” means the
cooperatives listed on Schedule 1.01(a).


 





















 


“Aggregate Credit Exposure” means, at
any time, the aggregate Credit Exposure of all the Lenders.


 


“Aggregate Commitment” means the
aggregate of the Commitments of all the Lenders, as reduced or increased from
time to time pursuant to the terms hereof, which Aggregate Commitment shall
initially be in the amount of $250,000,000.


 


“Alternate Base Rate” means, for any
day, a rate per annum equal to the greatest of (a) the Prime Rate in
effect on such day and (b) the Federal Funds Effective Rate in effect on
such day plus 1⁄2 of 1%.  Any change
in the Alternate Base Rate due to a change in the Prime Rate or the Federal
Funds Effective Rate shall be effective from and including the effective date
of such change in the Prime Rate or the Federal Funds Effective Rate,
respectively.


 


“Applicable Percentage” means, with
respect to any Lender, (a) with respect to Revolving Loans, LC Exposure,
Swingline Loans, a portion equal to a fraction the numerator of which is such
Lender’s Revolving Commitment and the denominator of which is the aggregate
Revolving Commitment of all Revolving Lenders (if the Revolving Commitments have
terminated or expired, the Applicable Percentages shall be determined based
upon the Revolving Commitments most recently in effect, giving effect to any
assignments), (b) with respect to Protective Advances or with respect to
the Aggregate Credit Exposure prior to the Maturity Date, a portion equal to a
fraction the numerator of which is such Lender’s Commitment and the denominator
of which is the Aggregate Commitment of all Lenders, and (c) with respect
to Protective Advances or with respect to the Aggregate Credit Exposure after
the Maturity Date, a portion equal to a fraction the numerator of which is such
Lender’s Credit Exposure and the denominator of which is the Aggregate Credit
Exposure.


 


“Applicable Rate” means, for any day,
with respect to any ABR Loan or Eurodollar Loan, or with respect to the
commitment fees payable hereunder, as the case may be, the applicable rate per
annum set forth below under the caption “ABR Spread”, “Eurodollar Spread” or “Commitment
Fee Rate”, as the case may be, based upon average daily Availability for the
Borrower’s most recent calendar quarter: 


 


	
  Level

  	
   

  	
  Average

  Availability

  	
   

  	
  ABR Spread

  	
   

  	
  Eurodollar

  Spread

  	
   

  	
  Commitment Fee

  Rate

  	
   

  
	
  I

  	
   

  	
  > $150,000,000

  	
   

  	
  0.00

  	
  %

  	
   

  	
  1.375

  	
  %

  	
   

  	
  0.35

  	
  %

  	
   

  
	
  II

  	
   

  	
  < $150,000,000

  	
   

  	
  0.25

  	
  %

  	
   

  	
  1.50

  	
  %

  	
   

  	
  0.30

  	
  %

  	
   

  
	
   

  	
   

  	
  > $75,000,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  III

  	
   

  	
  < $75,000,000

  	
   

  	
  0.375

  	
  %

  	
   

  	
  1.625

  	
  %

  	
   

  	
  0.25

  	
  %

  	
   

  



 


For the purposes of the above pricing grid,
from the Effective Date until January 1, 2006, the Applicable Margin shall
be set at Level I.  Changes in the
Applicable Margin resulting from changes in Availability shall become effective
on the first day of each calendar quarter, commencing January 1, 2006,
based upon the average daily Availability for the immediately preceding
calendar quarter.


 


2





















 


“Approved Fund” has the meaning
assigned to such term in Section 9.04.


 


“Asset Retirement Obligations” means
obligations associated with the retirement of tangible long-lived assets that
result from the acquisition, construction, or development and/or the normal
operation of a long-lived asset that are accounted for in accordance with FASB
Statement of Financial Accounting Standards No. 143.


 


“Assignment and Assumption” means an
assignment and assumption entered into by a Lender and an assignee (with the
consent of any party whose consent is required by Section 9.04),
and accepted by the Administrative Agent, in the form of Exhibit A
or any other form approved by the Administrative Agent.


 


“Availability” means, at any time, an
amount equal to the lesser of (a) the total Revolving Commitments and (b) the
Borrowing Base, in each case, minus
the Revolving Credit Exposure of all Revolving Lenders.


 


“Available Revolving Commitment”
means, at any time, with respect to a Revolving Lender, the Revolving
Commitment of such Revolving Lender then in effect minus the Revolving Credit Exposure of
such Revolving Lender at such time.


 


“Availability Period” means the period
from and including the Effective Date to but excluding the earlier of the
Maturity Date and the date of termination of the Commitments pursuant to the
terms hereof.


 


“Banking Services” means each and any
of the following bank services provided to any Loan Party by any Lender or any
of its Affiliates: (a) commercial credit cards, (b) stored value
cards and (c) treasury management services (including, without limitation,
controlled disbursement, automated clearinghouse transactions, return items,
overdrafts and interstate depository network services.


 


“Banking Services Obligations” of the
Loan Parties means any and all obligations of the Loan Parties, whether
absolute or contingent and howsoever and whensoever created, arising, evidenced
or acquired (including all renewals, extensions and modifications thereof and
substitutions therefore) in connection with Banking Services.


 


“Banking Services Reserves” means all
Reserves which the Administrative Agent from time to time establishes in its
Permitted Discretion for Banking Services then provided or outstanding.


 


“Bankruptcy Code” means Title 11 of the
United States Code, or any successor statute, as in effect from time to time.


 


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


 


“Borrower” has the meaning assigned to
such term in the preamble of this Agreement.


 


3





















 


“Borrowing” means (a) Revolving
Loans of the same Type, made, converted or continued on the same date and, in
the case of Eurodollar Loans, as to which a single Interest Period is in
effect, (b) a Swingline Loan, and (c) a Protective Advance.


 


“Borrowing Base” means, at any time,
the sum of:


 


(a)           85%
of the Borrower’s Eligible Accounts at such time, plus


 


(b)           the
lesser of (i) 75% of the Borrower’s Eligible Inventory, valued at the
lower of cost or market value, determined on a first-in-first-out basis (in
accordance with GAAP), at such time and (ii) 85% of the Net Orderly
Liquidation Value of the Borrower’s Eligible Inventory (based on the then most
recent independent inventory appraisal received by the Administrative Agent), plus


 


(c)           the
PP&E Component, minus


 


(d)           Reserves.


 


The Borrowing Base at any time shall be determined by reference to the
most recent Borrowing Base Certificate theretofore delivered to the
Administrative Agent (absent any error in such Borrowing Base Certificate); provided,
that the Borrowing Base shall be adjusted (i) upon at least one (1) Business
Day’s prior written notice (or such earlier notice, if any, required in
accordance with the terms hereof) from the Administrative Agent to the Borrower
of the establishment of any Reserve by the Administrative Agent in accordance
with the terms of this Agreement or the exclusion by the Administrative Agent
in accordance with the terms of this Agreement of any previously eligible component
of the Borrowing Base and (ii) at the Administrative Agent’s election when
cash dominion is in effect pursuant to Section 7.1 of the Security
Agreement, for collections received in respect of Accounts.


 


“Borrowing Base Certificate” means a
certificate, signed and certified as accurate and complete by a Financial
Officer of the Borrower, in substantially the form of Exhibit C or
another form which is acceptable to the Administrative Agent and the Borrower
in their reasonable discretion.


 


“Borrowing Request” means a request by
the Borrower for a Revolving Borrowing in accordance with Section 2.04.


 


“Business Day” means any day that is
not a Saturday, Sunday or other day on which commercial banks in New York City
are authorized or required by law to remain closed; provided that, when
used in connection with a Eurodollar Loan, the term “Business Day” shall
also exclude any day on which banks are not open for dealings in dollar
deposits in the London interbank market.


 


“Capital Expenditures” means, without
duplication, any expenditure for any purchase or other acquisition of any asset
which would be classified as a fixed or capital asset on a consolidated balance
sheet of the Loan Parties and their Subsidiaries prepared in accordance with
GAAP.


 


4





















 


“Capital Lease Obligations” of any
Person means the obligations of such Person to pay rent or other amounts under
any lease of (or other arrangement conveying the right to use) real or personal
property, or a combination thereof, which obligations are required to be
classified and accounted for as capital leases on a balance sheet of such
Person under GAAP, and the amount of such obligations shall be the capitalized
amount thereof determined in accordance with GAAP.


 


“Cash Availability Amount” means, at
any time, (A) the sum of (i) Availability plus (ii) the amount
of unrestricted cash and Permitted Investments, in each case deposited or held
in a depository account or investment account maintained with Chase and subject
to a springing blocked account or control agreement in favor of the
Administrative Agent, minus (B) the sum of (i) the aggregate
amount of all outstanding Guarantees by the Loan Parties constituting
investments permitted under Section 6.04(h), but only to the extent
of amounts which are then due and owing under such Guarantees or are claimed to
be due and owing thereunder (except to the extent that the Loan Parties are
contesting such claims in good faith by appropriate proceedings and have not
set aside reserves on their books with respect thereto) plus (ii) the
aggregate amount of all dividends on the Parent’s common stock which have been
declared but are then unpaid.


 


“CFL” means Canadian Fertilizers,
Ltd., a limited company organized under the laws of the Province of Alberta,
Canada.


 


“Change in Control” means any of (a) any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934 (as amended)), other than (i) the
Affiliated Cooperatives or (ii) any employee benefit plan of the Parent or
its Subsidiaries, and any person or entity acting solely in its capacity as
trustee, agent or other fiduciary or administrator of any such plan, becomes
the “beneficial owner” (as that term is used under Rule 13d-3 of the
Securities and Exchange Commission), directly or indirectly, of Equity
Interests representing more than thirty-five percent (35%) of the aggregate
ordinary voting power represented by the issued and outstanding Equity
Interests of the Parent; (b) occupation of a majority of the seats (other
than vacant seats) on the board of directors of the Parent by Persons who were
neither (i) nominated by the board of directors of the Parent nor (ii) appointed
by directors so nominated; (c) the failure of the Parent to own, directly
or indirectly, 100% of the outstanding Equity Interests of the Borrower; or (d) any
“change of control” (as such term or any words of similar import are defined
under any Indebtedness permitted under Section 6.01(o)) shall
occur.


 


“Change in Law” means (a) the
adoption of any law, rule or regulation after the date of this Agreement, (b) any
change in any law, rule or regulation or in the interpretation or
application thereof by any Governmental Authority after the date of this
Agreement or (c) compliance by any Lender or any Issuing Bank (or, for
purposes of Section 2.16(b), by any lending office of such Lender
or by such Lender’s or such Issuing Bank’s holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.


 


“Chase” means JPMorgan Chase Bank,
N.A., a national banking association, in its individual capacity, and its
successors.


 


5





















 


“Class”, when used in reference to any
Loan or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are Revolving Loans, Swingline Loans or Protective Advances.


 


“Closing Checklist” means that certain
closing checklist attached hereto as Exhibit D.


 


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


 


“Collateral” means any and all
property owned, leased or operated by a Person covered by the Collateral
Documents and any and all other property of any Loan Party, now existing or
hereafter acquired, that may at any time be or become subject to a security
interest or Lien in favor of Administrative Agent, on behalf of itself and the
Secured Parties, to secure the Obligations.


 


“Collateral Access Agreement” has the
meaning assigned to such term in the Security Agreement.


 


“Collateral Documents” means,
collectively, the Security Agreement, the Mortgages and any other documents
granting a Lien upon the assets or property of a Loan Party as security for
payment of the Obligations.


 


“Collection Account” has the meaning
assigned to such term in the Security Agreement.


 


“Commitment” means, with respect to
each Lender, such Lender’s Revolving Commitment, together with the commitment
of such Lender to acquire participations in Protective Advances hereunder, as
such Commitment may be (a) reduced from time to time pursuant to Section 2.10,
(b) increased from time to time pursuant to Section 2.02(b),
and (c) reduced or increased from time to time pursuant to assignments by
or to such Lender pursuant to Section 9.04.  The initial amount of each Lender’s
Commitment is set forth on the Commitment Schedule, or in the Assignment
and Assumption or joinder agreement related to any Commitment Increase pursuant
to which such Lender shall have assumed its Commitment, as applicable.


 


“Commitment Increase” has the meaning
assigned to such term in Section 2.02(b).


 


“Commitment Increase Cap” has the
meaning assigned to such term in Section 2.02(b).


 


“Commitment Schedule” means the Schedule attached
hereto identified as such.


 


“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, provided that being an officer or
director of a Person shall not, in and of itself, be deemed “Control” of such
Person.  “Controlling” and “Controlled”
have meanings correlative thereto.


 


6





















 


“Credit Exposure” means, as to any
Lender at any time, the sum of (a) such Lender’s Revolving Credit Exposure
at such time, plus (b) an
amount equal to its Applicable Percentage, if any, of the aggregate principal
amount of Protective Advances outstanding at such time.


 


“Default” means any event or condition
which constitutes an Event of Default or which upon notice, lapse of time or
both would, unless cured or waived, become an Event of Default.


 


“Defaulting Lender” has the meaning
assigned to such term in Section 2.08(b).


 


“Disclosed Matters” means the
environmental matters disclosed in Schedule 3.06.


 


“Document” has the meaning assigned to
such term in the Security Agreement.


 


“dollars” or “$” refers to
lawful money of the United States of America.


 


“Domestic Subsidiary” means any
Subsidiary organized under the laws of the United States or any state thereof
or the District of Columbia.


 


“Donaldsonville Real Estate” means the
real property listed on Schedule 1.01(c) owned by the
Borrower.


 


“EBITDA” of a Person means, with
reference to any period, Net Income for such period plus, without duplication
and to the extent deducted from revenues in determining Net Income, the sum of (a) the
aggregate amount of Interest Expense for such period, (b) the aggregate
amount of expense for taxes paid or accrued for such period (including payments
to Affiliated Cooperatives under the NOL Agreement), (c) all amounts
attributable to depreciation and depletion for such period, (d) all
amortization and other non-cash charges (including non-cash charges for Plan
liability and Asset Retirement Obligations but excluding minority interest with
respect to Western Co-operative Fertilizers Limited) for such period and (e) extraordinary
losses (as determined in accordance with GAAP) incurred other than in the
ordinary course of business, minus, to the extent included in Net Income,
extraordinary gains (as determined in accordance with GAAP) for such period
realized other than in the ordinary course of business, all calculated for the
Loan Parties and their Subsidiaries on a consolidated basis.


 


“Effective Date” means the date on
which the conditions specified in Section 4.01 are satisfied (or
waived in accordance with Section 9.02).


 


“Eligible Accounts” means, at any
time, the aggregate Accounts of the Borrower; provided that, unless otherwise
agreed by the Administrative Agent in its sole discretion, Eligible Accounts
shall not include any Account:


 


(a)           which
is not subject to a first priority perfected security interest (subject to
inchoate Liens permitted under clause (a) of the definition of Permitted
Encumbrances) in favor of the Administrative Agent;


 


7





















 


(b)           which
is subject to any Lien other than (i) a Lien in favor of the Administrative
Agent and (ii) a Permitted Encumbrance which (except as permitted under
clause (a) above) does not have priority over the Lien in favor of the
Administrative Agent;


 


(c)           which is unpaid more than ninety (90) days after
the date of the original invoice therefor or more than sixty (60) days after
the original due date, or which has been written off the books of the Borrower
or otherwise designated as uncollectible;


 


(d)           which
is owing by an Account Debtor for which more than fifty percent (50%) of the
Accounts owing from such Account Debtor and its Affiliates are ineligible
pursuant to clause (c) above;


 


(e)           which
is owing by an Account Debtor to the extent the aggregate amount of Accounts
owing from such Account Debtor and its Affiliates to the Borrower exceeds
twenty percent (20%) (thirty percent (30%) in the case of Accounts owing by
Agriliance LLC or any other Account Debtor approved by the Administrative Agent
in its sole discretion) of the aggregate Eligible Accounts, but only to the
extent of such excess;


 


(f)            with
respect to which any representation or warranty contained in this Agreement or
in the Security Agreement is not true in any material respect;


 


(g)           which
(i) does not arise from the sale of goods or performance of services in
the ordinary course of business, (ii) is not evidenced by an invoice or
other documentation satisfactory to the Administrative Agent which has been
sent to the Account Debtor, (iii) represents a progress billing, (iv) is
contingent upon the Borrower’s completion of any further performance, (v) represents
a sale on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval,
consignment, cash on delivery or any other repurchase or return basis or (vi) relates
to payments of interest;


 


(h)           for
which the goods (if any) giving rise to such Account have not been shipped to
the Account Debtor or for which the services giving rise to such Account have
not been performed by the Borrower or if such Account was invoiced more than
once;


 


(i)            [Intentionally
Omitted];


 


(j)            which
is owed by an Account Debtor which has (i) applied for, suffered, or
consented to the appointment of any receiver, custodian, trustee, or liquidator
of its assets, (ii) has had possession of all or a material part of its
property taken by any receiver, custodian, trustee or liquidator, (iii) filed,
or had filed against it, any request or petition for liquidation,
reorganization, arrangement, adjustment of debts, adjudication as bankrupt,
winding-up, or voluntary or involuntary case under any state or federal
bankruptcy laws (other than post-petition Accounts payable of an Account Debtor
that is a debtor-in-possession under the Bankruptcy Code and reasonably
acceptable to the Administrative Agent), (iv) has admitted in writing its
inability, or is generally unable to, pay its debts as they become due, (v) become
insolvent, or (vi) ceased operation of its business;


 


(k)           which
is owed by any Account Debtor which has sold all or substantially all of its
assets;


 


8





















 


(l)            which
is owed by an Account Debtor which (i) does not maintain its chief
executive office in the U.S. or Canada (other than the Province of
Newfoundland) or (ii) is not organized under applicable law of the U.S.,
any state of the U.S., Canada, or any province of Canada (other than the
Province of Newfoundland) unless, in either case, such Account is based by a
letter of credit or foreign credit insurance reasonably acceptable to the
Administrative Agent which is in the possession of or has been assigned to the
Administrative Agent;


 


(m)          which
is owed in any currency other than U.S. dollars or Canadian dollars; provided
that, with respect to Accounts owed in Canadian dollars, the value of such
Accounts for purposes of calculating the Borrowing Base shall be expressed in
U.S. dollars based on the spot rate quoted by the Administrative Agent on the
date of the applicable Borrowing Base Certificate for the purchase by the
Administrative Agent of Canadian dollars with U.S. dollars;


 


(n)           which
is owed by (i) the government (or any department, agency, public
corporation, or instrumentality thereof) of any country or state other than the
U.S. or any state of the U.S. unless such Account is backed by a letter of
credit reasonably acceptable to the Administrative Agent which is in the
possession of or has been assigned to the Administrative Agent, or (ii) the
government of the U.S., or any department, agency, public corporation, or
instrumentality thereof, unless the Federal Assignment of Claims Act of 1940,
as amended (31 U.S.C. § 3727 et  seq. and 41 U.S.C. § 15
et  seq.), has been complied with to the Administrative Agent’s
reasonable satisfaction;


 


(o)           which
is owed by any Affiliate, employee, officer or director of any Loan Party;
provided that an Account owed by an Affiliated Cooperative or Agriliance LLC
shall not be deemed ineligible by virtue of this clause (o);


 


(p)           which,
for any Account Debtor, exceeds a credit limit determined by the Borrower to
the extent of such excess;


 


(q)           which
(i) is owed by an Account Debtor or any Affiliate of such Account Debtor
to which any Loan Party is indebted or owes trade credit, but only to the
extent of the lesser of such indebtedness or trade credit or the face amount of
such Account or (ii) is subject to any security, deposit, progress
payment, retainage or other similar advance made by or for the benefit of an
Account Debtor, but in each case only to the extent of the lesser of such
security, deposit, progress payment, retainage or advance or the face amount of
such Account;


 


(r)            which
is subject to any counterclaim, deduction, defense, setoff or dispute, in each
case which has been asserted or is otherwise known to a Responsible Officer of
the Borrower, but only to the extent of any such counterclaim, deduction, defense,
setoff or dispute;


 


(s)           [Intentionally
Omitted];


 


(t)            which
is owed by an Account Debtor located in any U.S. or Canadian jurisdiction which
requires filing of a “Notice of Business Activities Report” or other similar
report in order to permit the Borrower to seek judicial enforcement in such
jurisdiction of payment of such Account, unless (i) the Borrower has filed
such report or qualified to do business in such jurisdiction or (ii) Borrower
may subsequently file any such report or qualify to do business and be able to
seek judicial enforcement in such jurisdiction;


 


9





















 


(u)           with
respect to which the Borrower has made any agreement with the Account Debtor
for any reduction thereof, other than reductions, discounts and adjustments
given in the ordinary course of business or that portion of an Account which
represents a prior Account which was partially paid and the Borrower created a
new receivable for the unpaid portion of such Account;


 


(v)           which
does not comply in all material respects with the requirements of all
applicable material laws and regulations, whether Federal, state or local,
including without limitation the Federal Consumer Credit Protection Act, the
Federal Truth in Lending Act and Regulation Z of the Board;


 


(w)          which
is for goods that have been sold under a purchase order or pursuant to the
terms of a contract or other agreement or understanding (written or oral) that
indicates any party other than the Borrower as payee or remittance party;


 


(x)            which
represents a deposit due from an Account Debtor under forward purchasing
arrangements entered into with the Borrower; or


 


(y)           which
the Administrative Agent has provided at least two (2) Business Days prior
written or telephonic notice to the Borrower that (i) the Administrative
Agent has determined in its Permitted Discretion that such Account may not be
paid by reason of the Account Debtor’s inability to pay or (ii) the
Administrative Agent has otherwise determined in its Permitted Discretion that
such Account is unacceptable for inclusion in the Borrowing Base.


 


In the event that an Account which was
previously an Eligible Account ceases to be an Eligible Account hereunder, the
Borrower shall exclude such Account from Eligible Accounts on, and at the time
of submission to the Administrative Agent of, the next Borrowing Base
Certificate.  In determining the amount
of an Eligible Account, the face amount of an Account shall be reduced by,
without duplication, to the extent not reflected in such face amount, (i) the
amount of all accrued and actual discounts, credits or credits pending,
promotional program allowances, price adjustments, finance charges or other
allowances (including any amount that the Borrower may be obligated to rebate
to an Account Debtor pursuant to the terms of any agreement or understanding
(written or oral)) (provided that such reductions shall not exceed the face
amount of such Account) and (ii) the aggregate amount of all cash received
in respect of such Account but not yet applied by the Borrower to reduce the
amount of such Account.


 


“Eligible Donaldsonville Equipment”
means the equipment owned by the Borrower and meeting each of the following
requirements:


 


(a)           the
Borrower has good title to such equipment;


 


(b)           the
Borrower has the right to subject such equipment to a Lien in favor of the
Administrative Agent; such equipment is subject to a first priority perfected
Lien (subject to inchoate Liens permitted under clauses (a) and (b) of
the definition of Permitted Encumbrances) in favor of the Administrative Agent
and is free and clear of all other Liens of any nature whatsoever (except for
Permitted Encumbrances which (except as permitted above) do not have priority
over the Lien in favor of the Administrative Agent);


 


10





















 


(c)           the
full purchase price for such equipment has been paid by the Borrower;


 


(d)           such
equipment is located on the Donaldsonville Real Estate (excluding equipment
with an aggregate fair market value not exceeding at any time $5,000,000 and
which is located elsewhere in the ordinary course of business);


 


(e)           such
equipment is in good working order and condition (ordinary wear and tear
excepted) and is used or held for use by the Borrower in the ordinary course of
business of the Borrower; and


 


(f)            such
equipment is not subject to any agreement which materially restricts the
Administrative Agent’s ability to take possession of, sell or otherwise dispose
of such equipment.


 


“Eligible Donaldsonville Fixed Assets”
means the collective reference to the Donaldsonville Real Estate and the
Eligible Donaldsonville Equipment.


 


“Eligible Inventory” means, at any
time, the Inventory of the Borrower; provided that, unless otherwise
agreed by the Administrative Agent in its sole discretion, Eligible Inventory
shall not include any Inventory:


 


(a)           which
is not subject to a first priority perfected Lien (subject to inchoate Liens
permitted under clauses (a) and (b) of the definition of Permitted
Encumbrances) in favor of the Administrative Agent;


 


(b)           which
is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent and (ii) a Permitted Encumbrance which (except as
permitted under clause (a) above) does not have priority over the Lien in
favor of the Administrative Agent;


 


(c)           which
is slow moving, obsolete, unmerchantable, unfit for sale or not salable;


 


(d)           with
respect to which any representation or warranty contained in this Agreement or
the Security Agreement is not true in any material respect and which does not
conform in all material respects to all standards imposed by any Governmental
Authority having regulatory authority over such goods;


 


(e)           which
is not owned by the Borrower or which Borrower does not have marketable title
thereto;


 


(f)            which
is not finished goods or raw materials or which constitutes work-in-process,
spare or replacement parts, subassemblies, packaging and shipping material,
manufacturing supplies, samples, prototypes, displays or display items,
bill-and-hold goods, defective or damaged goods, goods held on consignment, or
goods which are not of a type held for sale in the ordinary course of business
except for raw materials;


 


(g)           which
is not located in the U.S. or Canada or is in transit with a common carrier
from vendors and suppliers;


 


11





















 


(h)           which
is located in any location leased by the Borrower unless (i) the lessor
has delivered to the Administrative Agent a Collateral Access Agreement or (ii) a
Reserve for rent, charges, and other amounts due or to become due with respect
to such facility has been established by the Administrative Agent in its
Permitted Discretion following consultation with the Borrower, provided,
however, (i) Collateral Access Agreements and/or Reserves shall not be
required until one hundred twenty (120) days after the Effective Date with
respect to locations existing on the Effective Date and (ii) Collateral
Access Agreements and/or Reserves shall not be required with respect to any
Inventory located at locations leased by the Borrower to the extent the
aggregate value of such Inventory at all such locations does not exceed
$5,000,000;


 


(i)            which
is located in any third party warehouse or is in the possession of a bailee and
is not evidenced by a Document, unless (i) such warehouseman or bailee has
delivered to the Administrative Agent a Collateral Access Agreement and such
other documentation as the Administrative Agent may require or (ii) an
appropriate Reserve has been established by the Administrative Agent in its
Permitted Discretion following consultation with the Borrower, provided,
however, (i) Collateral Access Agreements and/or Reserves shall not be
required until one hundred twenty (120) days after the Effective Date with
respect to locations existing on the Effective Date (ii) Collateral Access
Agreements and/or Reserves shall not be required with respect to any Inventory
located in any third party warehouse or in the possession of a bailee to the
extent the aggregate value of such Inventory at all such locations does not
exceed $5,000,000;


 


(j)            [Intentionally
Omitted];


 


(k)           which
is a discontinued product or component thereof;


 


(l)            which
is the subject of a consignment by the Borrower as consignor;


 


(m)          which
contains or bears any intellectual property rights licensed to the Borrower
unless the Administrative Agent may sell or otherwise dispose of such Inventory
without (i) infringing the rights of such licensor, (ii) violating
any contract with such licensor, or (iii) incurring any liability with respect
to payment of royalties other than royalties incurred pursuant to sale of such
Inventory under the current licensing agreement;


 


(n)           which
is not reflected in a current perpetual inventory report of the Borrower; or


 


(o)           which
the Administrative Agent has provided at least two (2) Business Days
written or telephonic notice to the Borrower that the Administrative Agent has
determined in its Permitted Discretion that such Inventory is unacceptable for
inclusion in the Borrowing Base.


 


In the event that Inventory which was
previously Eligible Inventory ceases to be Eligible Inventory hereunder, the
Borrower shall exclude such Inventory from Eligible Inventory on, and at the
time of submission to the Administrative Agent of, the next Borrowing Base Certificate.


 


12





















 


“Eligible Other Real Property” means
any real property listed on Schedule 1.01(d) (as such Schedule may
be amended from time to time by the Borrower after the Effective Date to
include additional distribution centers in the United States, which update
shall not constitute an amendment waiver or modification subject to Section 9.02)
owned by the Borrower (i) in respect of which an appraisal report has been
delivered to the Administrative Agent (for delivery to each Lender) in form,
scope and substance reasonably satisfactory to the Administrative Agent, (ii) in
respect of which the Administrative Agent is reasonably satisfied that all
actions necessary to create a perfected first priority Lien in favor of the
Administrative Agent on such real property have been taken, including, the
filing and recording of Mortgages, (iii) in respect of which an
environmental assessment report has been completed and delivered to the
Administrative Agent (for delivery to each Lender) in form and substance
reasonably satisfactory to the Administrative Agent and which does not indicate
any material pending, threatened or existing Environmental Liability, or
material non-compliance with any Environmental Law, (iv) which is
adequately protected by fully-paid valid title insurance with endorsements and
in amounts and form reasonably acceptable to the Administrative Agent, insuring
that the Administrative Agent, for the benefit of the Lenders, shall have a
perfected first priority Lien on such real property, (v) with respect to
which the Administrative Agent had received evidence reasonably acceptable to
it as to whether such real property constitutes Flood Hazard Property and, if
so, evidence that the Borrower has obtained flood hazard insurance as required
by law and as reasonably acceptable to the Administrative Agent, and (vi) if
required by the Administrative Agent in its Permitted Discretion: (A) a
current ALTA survey (or an affidavit of no change to an existing survey, provided
that the title company issuing the title insurance will issue its title policy
with full survey coverage, including all survey related endorsements) has been
delivered for which all necessary fees have been paid, certified to
Administrative Agent and the issuer of the title insurance policy in a manner
reasonably satisfactory to the Administrative Agent by a land surveyor duly
registered and licensed in the state in which such Eligible Other Real Property
is located and reasonably acceptable to the Administrative Agent, and shows, to
the extent applicable, all buildings and other improvements, any offsite
improvements, the location of any easements, parking spaces, rights of way,
building setback 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 reasonably acceptable to
the Administrative Agent; (B) in respect of which local counsel for the
Borrower in states in which the Eligible Other Real Property is located have
delivered a letter(s) of opinion with respect to the enforceability and
perfection of the Mortgages in the applicable state and any related fixture
filings in form and substance reasonably satisfactory to the Administrative
Agent; and (C) in respect of which the Borrower shall have used its
commercially reasonable efforts to obtain estoppel certificates executed by all
tenants of such Eligible Other Real Property and other consents as the
Administrative Agent may reasonably require in its Permitted Discretion.


 


“Environmental Laws” means all laws,
rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions
or binding agreements issued, promulgated or entered into by any Governmental
Authority, relating in any way to the environment, preservation or reclamation
of natural resources, the management, release or threatened release of any
Hazardous Material or to health and safety matters.


 


“Environmental Liability” means any
liability, contingent or otherwise (including any liability for damages, costs
of environmental remediation, fines, penalties or indemnities), of


 


13





















 


the Borrower or any Subsidiary directly or indirectly resulting from or
based upon (a) violation of any Environmental Law, (b) the treatment
(for the purpose of reducing hazardous characteristics) or disposal of any
Hazardous Materials, (c) exposure of any natural person 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.


 


“Equipment” has the meaning set forth
in Article 9 of the UCC.


 


“Equity Interests” means shares of
capital stock, partnership interests, membership interests in a limited
liability company, beneficial interests in a trust or other equity ownership
interests in a Person, and any warrants, options or other rights entitling the
holder thereof to purchase or acquire any such equity interest.


 


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


 


“ERISA Affiliate” means any trade or
business (whether or not incorporated) that, together with the Borrower, is
treated as a single employer under Section 414(b) or (c) of the
Code or, solely for purposes of Section 302 of ERISA and Section 412
of the Code, is treated as a single employer under Section 414 of the
Code.


 


“ERISA Event” means (a) any “reportable
event”, as defined in Section 4043 of ERISA or the regulations issued
thereunder with respect to a Plan (other than an event for which the 30-day
notice period is waived); (b) the existence with respect to any Plan of an
“accumulated funding deficiency” (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived; (c) the filing pursuant
to Section 412(d) of the Code or Section 303(d) of ERISA of
an application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of
any liability under Title IV of ERISA with respect to the termination of
any Plan; (e) the receipt by the Borrower or any ERISA Affiliate from the
PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the
incurrence by the Borrower or any of its ERISA Affiliates of any liability with
respect to the withdrawal or partial withdrawal from any Plan or Multiemployer
Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any
notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA
Affiliate of any notice, concerning the imposition of Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Title IV of ERISA.


 


“Eurodollar”, when used in reference
to any Loan or Borrowing, means such Loan, or the Loans comprising such
Borrowing, are bearing interest at a rate determined by reference to the
Adjusted LIBO Rate.


 


“Event of Default” has the meaning
assigned to such term in Article VII.


 


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


 


14





















 


“Excluded Taxes” means, with respect
to the Administrative Agent, any Lender, any Issuing Bank or any other
recipient of any payment to be made by or on account of any obligation of the
Borrower hereunder, (a) income or franchise taxes imposed on or measured
by its net income (or any Person whose net income is measured with reference to
such recipient) by the United States of America, or as a result of a present or
former connection between such recipient and the jurisdiction imposing such tax
(or any political subdivision thereof), other than any such connection arising
solely from such recipient having executed, delivered or performed its
obligations or received a payment under, or enforced, this Agreement or any
other Loan Document, (b) any branch profits taxes imposed by the United
States of America or any similar tax imposed by any other jurisdiction in which
the Borrower is located and (c) in the case of a Foreign Lender (other
than an assignee pursuant to a request by the Borrower under Section 2.20(b)),
any withholding tax that is applicable to amounts payable to such Foreign
Lender at the time such Foreign Lender becomes a party to this Agreement (or
designates a new lending office) or is attributable to such Foreign Lender’s
failure to comply with Section 2.18(e), except to the extent that
such Foreign Lender (or its assignor, if any) was entitled, at the time of
designation of a new lending office (or assignment), to receive additional
amounts from the Borrower with respect to such withholding tax pursuant to Section 2.18(a).


 


“Federal Funds Effective Rate” means,
for any day, the weighted average (rounded upwards, if necessary, to the next
1/100 of 1%) of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers, as published
on the next succeeding Business Day by the Federal Reserve Bank of
New York, or, if such rate is not so published for any day that is a
Business Day, the average (rounded upwards, if necessary, to the next 1/100 of
1%) of the quotations for such day for such transactions received by the
Administrative Agent from three Federal funds brokers of recognized national
standing selected by it.


 


“Financial Officer” means, in respect
of a Person, the chief financial officer, principal accounting officer,
treasurer or controller of such Person.


 


“Fixed Charge Coverage Ratio” means,
the ratio, determined as of the end of each fiscal quarter of the Parent and
its Subsidiaries for the most-recently ended four fiscal quarters, of (a) EBITDA
minus the unfinanced portion of Capital Expenditures to (b) Fixed Charges,
all calculated for the Parent and its Subsidiaries on a consolidated basis.


 


“Fixed Charges” means, with reference
to any period, without duplication, Interest Expense (excluding cash Interest
Expense associated with the make-whole payment related to the prepayment of the
Noteholder Obligations) for such period, plus prepayments and scheduled principal
payments on Indebtedness (excluding the Noteholder Obligations) made during
such period (excluding prepayments on Indebtedness to the extent financed with
the proceeds of replacement Indebtedness other than Revolving Loans), plus expense for taxes (including payments
to Affiliated Cooperatives under the NOL Agreement) for such period paid or payable in cash, plus Restricted Payments paid in cash, plus Capital Lease
Obligation payments (excluding any portion of such payments included in
Interest Expense), plus cash
contributions to any Plan during such period, plus
cash payments made in respect of Asset Retirement Obligations during
such period, plus cash deposits
made during such period to secure


 


15





















 


the Phosphogypsum Stack Liability in accordance with the Phosphogypsum
Stack Rules, all calculated for the Parent and its Subsidiaries on a
consolidated basis.


 


“Flood Hazard Property” means any real
property of a Loan Party subject to a Mortgage on which improvements are located
and which is located in an area designated by the Federal Emergency Management
Agency as having special flood or mud slide hazards.


 


“Foreign Lender” means any Lender that
is not a United States person as defined in Section 7701(a)(30) of the
Code.


 


“Foreign Subsidiary” means any
Subsidiary which is organized under the laws of a jurisdiction other than the
United States of America or any state thereof or the District of Columbia.


 


“Funding Account” has the meaning
assigned to such term in Section 4.01(g).


 


“GAAP” means generally accepted
accounting principles in the United States of America as set forth from time to
time.


 


“Governmental Authority” means the
government of the United States of America, any other nation or any political
subdivision thereof, whether state or local, and any agency, authority,
instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of government.


 


“Guarantee” of or by any Person (the “guarantor”)
means any obligation, contingent or otherwise, of the guarantor guaranteeing
any Indebtedness or other obligation of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, and including any obligation
of the guarantor, direct or indirect, (a) to purchase or pay (or advance
or supply funds for the purchase or payment of) such Indebtedness or other
obligation or to purchase (or to advance or supply funds for the purchase of)
any security for the payment thereof, (b) to purchase or lease property,
securities or services for the purpose of assuring the owner of such
Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay
such Indebtedness or other obligation or (d) as an account party in
respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided, that the term “Guarantee” shall
not include endorsements for collection or deposit in the ordinary course of
business.  The amount of any Guarantee
obligation of any guarantor shall be deemed to be the lower of (i) an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Guarantee obligation is made and (ii) the maximum
amount for which such guarantor may be liable pursuant to the terms of the
instrument embodying such guarantee Obligation, unless such primary obligation
and the maximum amount or which such guarantor may be liable are not stated or
determinable, in which case the amount of such Guarantee obligation shall be
such guarantor’s maximum reasonably anticipated liability in respect thereof as
determined by the Borrower in good faith.


 


“Guaranteed Obligations” has the
meaning assigned to such term in Section 10.01.


 


16





















 


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


 


“Immaterial Subsidiary” means, as of
any date of determination, a Subsidiary (other than a Loan Party) (a) whose
consolidated total assets do not constitute more than 3% of the consolidated
total assets of the Parent (on a pro forma basis for the most recently ended
fiscal year of the Parent for which audited financial statements are available)
and (b) whose consolidated gross sales do not constitute more than 3% of
the consolidated gross sales of the Parent (on a pro forma basis for the
most recently ended fiscal year of the Parent for which audited financial
statements are available).


 


“Indebtedness” of any Person means,
without duplication, (a) all obligations of such Person for borrowed money
or with respect to deposits or advances of any kind (other than deposits or
advances in the ordinary course of business), (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person upon which interest charges are customarily paid, (d) all
obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person, (e) all obligations
of such Person in respect of the deferred purchase price of property or
services (excluding current accounts payable incurred in the ordinary course of
business), (f) all Indebtedness of others secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise, to
be secured by) any Lien on property owned or acquired by such Person, whether
or not the Indebtedness secured thereby has been assumed, (g) all
Guarantees by such Person of Indebtedness of others, (h) the principal
portion of all Capital Lease Obligations of such Person, (i) all
obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty, (j) all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances, (k)
obligations under any liquidated earn-out and (l) obligations of such Person to
purchase securities or other property arising out of or in connection with the
sale of the same securities or property or any other Off-Balance Sheet
Liability.  The Indebtedness of any
Person shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general partner) to the extent such Person
is liable therefor as a result of such Person’s ownership interest in or other
relationship with such entity, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefor.  In the avoidance of doubt, “Indebtedness”
shall not include obligations or liabilities under operating leases.


 


“Indemnified Taxes” means Taxes other
than Excluded Taxes.


 


“Information Memorandum” means the
Confidential Information Memorandum dated June, 2005 relating to the Borrower
and the Transactions.


 


“Interest Election Request” means a
request by the Borrower to convert or continue a Revolving Borrowing in
accordance with Section 2.08.


 


17





















 


“Interest Expense” means, with
reference to any period, accrued interest expense of the Borrower and its
Subsidiaries calculated on a consolidated basis for such period excluding
amortization of financing fees.


 


“Interest Payment Date” means (a) with
respect to any ABR Loan, the last day of each calendar month and the Maturity
Date, and (b) with respect to any Eurodollar Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part and,
in the case of a Eurodollar Borrowing with an Interest Period of more than
three months’ duration, each day prior to the last day of such Interest Period
that occurs at intervals of three months’ duration after the first day of such
Interest Period and the Maturity Date.


 


“Interest Period” means with respect
to any Eurodollar Borrowing, the period commencing on the date of such Borrowing
and ending on the numerically corresponding day in the calendar month that is
one, two, three or six months (or, with the consent of each Lender, nine
or twelve months) thereafter, as the Borrower may elect; provided, that (i) if
any Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period pertaining to a Eurodollar Borrowing that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest
Period.  For purposes hereof, the date of
a Borrowing initially shall be the date on which such Borrowing is made and, in
the case of a Revolving Borrowing, thereafter shall be the effective date of
the most recent conversion or continuation of such Borrowing.


 


“Inventory” has the meaning assigned
to such term in the Security Agreement.


 


“IPO” means the initial public
offering of the Parent’s common stock as described in the Registration
Statement.


 


“Issuing Bank” means Chase, or any
other Lender requested by the Borrower and approved by Chase in its reasonable
discretion, in their capacity as the issuers of Letters of Credit hereunder,
and their respective successors in such capacity as provided in Section 2.07(i);
provided that at no time shall there be more than two Issuing Banks in
addition to Chase.  Any Issuing Bank may,
in its discretion, arrange for one or more Letters of Credit to be issued by
Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall
include any such Affiliate with respect to Letters of Credit issued by such
Affiliate.


 


“Joinder Agreement” has the meaning
assigned to such term in Section 5.11.


 


“Joint Venture” means a limited-purpose
corporation, partnership, limited liability company, joint venture or other
similar legal arrangement (whether created or conducted through a separate
legal entity) (excluding a Subsidiary) now or hereafter formed or invested in
by the Parent or any of its Subsidiaries with another Person or Persons in
order to conduct a common venture or enterprise with such Person or Persons.


 


18





















 


“LC Disbursement” means a payment made
by an Issuing Bank pursuant to a Letter of Credit.


 


“LC Exposure” means, at any time, the
sum of (a) the aggregate undrawn amount of all outstanding Letters of
Credit at such time plus (b) the aggregate amount of all LC Disbursements
that have not yet been reimbursed by or on behalf of the Borrower at such
time.  The LC Exposure of any Revolving
Lender at any time shall be its Applicable Percentage of the total LC Exposure
at such time.


 


“LC Collateral Account” has the
meaning assigned to such term in Section 2.07(j).


 


“LC Shortfall Amount” means an amount
equal to the difference of (x) the amount of LC Exposure at such time, less (y)
the amount on deposit in the LC Collateral Account at such time which has not
been applied against the Obligations.


 


“Lenders” means the Persons listed on
the Commitment Schedule and any other Person that shall have become
a party hereto pursuant to an Assignment and Assumption (other than any such
Person that ceases to be a party hereto pursuant to an Assignment and
Assumption) or pursuant to a joinder agreement in connection with any
Commitment Increase.  Unless the context
otherwise requires, the term “Lenders” includes the Swingline Lender.


 


“Letter of Credit” means any letter of
credit issued pursuant to this Agreement.


 


“LIBO Rate” means, with respect to any
Eurodollar Borrowing for any Interest Period, the rate appearing on Page 3750
of the Dow Jones Market Service (or on any successor page or any successor
to such Service, or any substitute page or substitute for such Service,
providing rate quotations comparable to those provided as of the Effective Date
on such page of such Service, as determined by the Administrative Agent
from time to time for purposes of providing quotations of interest rates
applicable to U.S. dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for U.S. dollar deposits with
a maturity comparable to such Interest Period. 
In the event that such rate is not available at such time for any
reason, then the “LIBO Rate” with respect to such Eurodollar Borrowing
for such Interest Period shall be the rate at which U.S. dollar deposits of an
amount comparable to such Eurodollar Borrowing and for a maturity comparable to
such Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior
to the commencement of such Interest Period.


 


“Lien” means, with respect to any
asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation,
encumbrance, charge or security interest in, on or of such asset, and (b) the
interest of a vendor or a lessor under any conditional sale agreement, capital
lease or title retention agreement (or any financing lease having substantially
the same economic effect as any of the foregoing) relating to such asset.


 


“Loan Documents” means this Agreement,
any promissory notes issued pursuant to this Agreement, any Letter of Credit
applications, the Collateral Documents, the Loan


 


19





















 


Guaranty, and all other agreements, instruments, documents and
certificates identified in Section 4.01 executed and delivered to,
or in favor of, the Administrative Agent or any Lenders and including all other
pledges, powers of attorney, consents, assignments, contracts, notices, letter
of credit agreements and all other written matter whether heretofore, now or
hereafter executed by or on behalf of any Loan Party, or any employee of any
Loan Party, and delivered to the Administrative Agent or any Lender in
connection with this Agreement or the transactions contemplated thereby.  Any reference in this Agreement or any other
Loan Document to a Loan Document shall include all appendices, exhibits or
schedules thereto, and all amendments, restatements, supplements or other
modifications thereto, and shall refer to this Agreement or such Loan Document
as the same may be in effect at any and all times such reference becomes
operative.


 


“Loan Guarantor” each Loan Party
(other than the Borrower) and any other Person who becomes a Loan Party
pursuant to a Joinder Agreement and their successors and assigns.


 


“Loan Guaranty” means Article X
of this Agreement.


 


“Loan Parties” means the Parent, the
Borrower, the Subsidiary Guarantors and any other Domestic Subsidiary of a Loan
Party who becomes a Subsidiary Guarantor party to this Agreement pursuant to a
Joinder Agreement and their successors and assigns.


 


“Loans” means the loans and advances
made by the Lenders pursuant to this Agreement, including Swingline Loans and
Protective Advances.


 


“Material Adverse Effect” means a
material adverse effect on (a) the business, assets, operations or financial
condition of the Parent and its Subsidiaries taken as a whole, (b) the
Collateral or the Administrative Agent’s Liens (on behalf of itself and the
Lenders) on the Collateral or the priority of such Liens, or (c) the
validity or enforceability of this Agreement or any of the other Loan Documents
or the rights and remedies, taken as a whole, of the Administrative Agent, the
Issuing Banks or the Lenders hereunder or thereunder.


 


“Material Indebtedness” means
Indebtedness (other than the Loans and Letters of Credit), or obligations in
respect of one or more Swap Agreements, of any one or more of the Loan Parties
and their Subsidiaries in an aggregate principal amount exceeding
$20,000,000.  For purposes of determining
Material Indebtedness, the “obligations” of any Loan Party or any Subsidiary in
respect of any Swap Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) that such Loan Party or such
Subsidiary would be required to pay if such Swap Agreement were terminated at
such time.


 


“Maturity Date” means August 16,
2010 or any earlier date on which the Commitments are reduced to zero or
otherwise terminated pursuant to the terms hereof.


 


“Maximum Liability” has the meaning
assigned to such term in Section 10.10.


 


“Moody’s” means Moody’s Investors
Service, Inc.


 


20





















 


“Mortgages” means any mortgage, deed
of trust or other agreement which conveys or evidences a Lien in favor of the
Administrative Agent, for the benefit of the Administrative Agent and the
Lenders, substantially in the form of Exhibit B, on real property of a
Loan Party, including any amendment, modification or supplement thereto.


 


“Multiemployer Plan” means a
multiemployer plan as defined in Section 3(37) of ERISA.


 


“Net Cash Proceeds” means, if in
connection with (a) an asset disposition, cash proceeds received net of
(without duplication) (i) commissions and other customary costs, premiums,
fees and expenses incurred and payable by any Loan Party in connection
therewith (in each case, paid to non-Affiliates), (ii) the principal
amount of any Indebtedness (other than Indebtedness under the Loan Documents)
that is secured by a senior Lien on such asset and that is required to be (and
is) repaid in connection with such asset disposition, (iii) federal,
state, provincial, foreign and local Taxes and other Taxes paid or reasonably
estimated to be payable in connection with such asset disposition (iv) any
reserves in accordance with GAAP against any liabilities associated with the
assets disposed of in such asset disposition and, without duplication, any
reserves that any Loan Party determines in good faith should be made in respect
of the sale price of such asset or assets for post-closing adjustments, or (b) an
equity issuance or the issuance or incurrence of Indebtedness, cash proceeds
received net of attorneys’ fees, investment banking fees, accountants’ fees,
underwriting discounts and commissions and other customary fees, costs,
commissions, premiums, fees and expenses incurred in connection therewith (in
each case, paid to non-Affiliates).


 


“Net Income” means, with reference to
any period, the net income (or loss) of the Parent and its Subsidiaries
calculated on a consolidated basis for such period in accordance with GAAP; provided
that there shall be excluded from Net Income the net income (or net loss) of
any Person accrued prior to the date it becomes a Subsidiary of, or has merged
into or consolidated with, the Borrower or another Subsidiary.


 


“Net Orderly Liquidation Value” means,
with respect to Inventory of any Person, the orderly liquidation value thereof
as determined in a manner reasonably acceptable to the Administrative Agent by
an appraiser reasonably acceptable to the Administrative Agent, net of all
costs of liquidation thereof.


 


“New Lender” has the meaning assigned
to such term in Section 2.02(b)(iii).


 


“NOL Agreement” means that certain Net
Operating Loss Agreement, dated on or about the Effective Date, by and among
the Parent, the Borrower and the Members (as defined therein).


 


“Non-Consenting Lender” has the
meaning assigned to such term in Section 9.02(f).


 


“Non-Paying Guarantor” has the meaning
assigned to such term in Section 10.11.


 


“Note Agreement Amendments” means
those certain amendments to the Noteholders Agreements listed on Schedule 1.01(e).


 


21





















 


“Noteholders” means the holders of the
Borrower’s promissory notes issued under the Noteholder Documents.


 


“Noteholders Depository Agreement”
means that certain Depository Agreement dated as of the effective date set
forth on Schedule 1 thereto by and between the depositor identified
on Schedule 1 thereto and JPMorgan Trust Company, N.A.


 


“Noteholders Documents” means those
certain agreements listed on Schedule 1.01(e) hereto, relating
to the issuance of certain promissory notes aggregating approximately
$235,600,000 in principal outstanding thereunder as of the Effective Date, and
each other instrument or document to be delivered thereunder.


 


“Noteholders Obligations” means all
obligations of the Borrower to pay principal and interest on the promissory
notes issued pursuant to those certain agreements listed on Schedule 1.01(e) hereto,
all fees and charges payable thereunder (including without limitation,
prepayment fees), and all other payment obligations of the Borrower or any of
its Subsidiaries arising under or in relation to any Noteholder Document, in
each case whether now existing or hereafter arising, due or to become due,
direct or indirect, absolute or contingent, and howsoever evidenced, held or
acquired.


 


“Obligated Party” has the meaning
assigned to such term in Section 10.02.


 


“Obligations” means all unpaid
principal of and accrued and unpaid interest on the Loans, all LC Exposure, all
accrued and unpaid fees and all expenses, reimbursements, indemnities and other
obligations of the Loan Parties to the Lenders or to any Lender, the
Administrative Agent, any Issuing Bank or any indemnified party arising under
the Loan Documents.  Obligations shall
also include (i) all Banking Services Obligations, provided that at
or prior to the time that any transaction relating to such Banking Services
Obligations is executed (or, if later, the Effective Date), the Lender party
thereto (other than Chase) shall have delivered written notice to the
Administrative Agent that such transaction has been entered into and that it
constitutes an Obligation entitled to the benefits of the Collateral Documents;
and (ii) all Swap Obligations owing to one or more Lenders or their
respective Affiliates, provided that at or prior to the time that any
transaction relating to such Swap Obligations is executed, the Lender party
thereto (other than Chase) shall have delivered written notice to the
Administrative Agent that such a transaction has been entered into and that it
constitutes an Obligation entitled to the benefits of the Collateral Documents.


 


“Off-Balance Sheet Liability” of a
Person means (a) any repurchase obligation or liability of such Person
with respect to accounts or notes receivable sold by such Person, (b) any
indebtedness, liability or obligation under any sale and leaseback transaction
which is not a Capital Lease Obligation, or (c) any indebtedness,
liability or obligation under any so-called “synthetic lease” transaction
entered into by such Person.


 


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


 


22





















 


“Parent” means CF Industries Holdings, Inc.,
a Delaware corporation.


 


“Participant” has the meaning set
forth in Section 9.04.


 


“Paying Guarantor” has the meaning
assigned to such term in Section 10.11.


 


“PBGC” means the Pension Benefit
Guaranty Corporation referred to and defined in ERISA and any successor entity
performing similar functions.


 


“Permitted Amount” means, as of any
date of determination thereof with respect to any loan, advance or other
investment subject to Section 6.04(h), (a) an unlimited
amount, so long as, immediately before and immediately after giving effect to
the making of such loan, advance or other investment (and to any related
Borrowing), the Cash Availability Amount is greater than $135,000,000, (b) $100,000,000
(excluding the aggregate amount of all loans, advances and other investments
previously made pursuant to the foregoing clause (a)), so long as, immediately
before and immediately after giving effect to the making of such loan, advance
or other investment (and to any related Borrowing), the Cash Availability
Amount is less than or equal to $135,000,00 and greater than $85,000,000 and (c) zero
(excluding the aggregate amount of all loans, advances and other advances
previously made pursuant to the foregoing clauses (a) and (b)), if the
Cash Availability Amount is less than $85,000,000, immediately before giving
effect to the making of such loan, advance or other investment (and to any
related Borrowing) or would be less than $85,000,000 immediately after giving
effect thereto.


 


“Permitted Capital Expenditure Amount”
means as of any date of determination thereof with respect to any Capital
Expenditure, (a) if the average daily Cash Availability Amount for the
most recent month (or, if earlier, any prior month) (the “triggering month”) is
less than $135,000,000, then until such time as the average daily Cash
Availability Amount for three consecutive months is greater than or equal to
$135,000,000, $100,000,000 during the twelve-month period commencing on the
first day of the month next succeeding such triggering month and, following the
completion of such twelve-month period, during the trailing twelve-month period
ending on the last day of each month thereafter and (b) at all other
times, an unlimited amount.


 


“Permitted Discretion” means a
determination made in good faith and in the exercise of reasonable (from the
perspective of a secured asset-based lender) business judgment.


 


“Permitted Encumbrances” means:


 


(a)           Liens
imposed by law for Taxes, assessments or governmental charges or levies that
are not yet due and payable or are being contested in compliance with Section 5.04;


 


(b)           landlords’,
carriers’, warehousemen’s, mechanics’, carriers’ materialmen’s, suppliers’,
processors’, repairmen’s and other like Liens imposed by law, arising in the
ordinary course of business and securing obligations that are not overdue by
more than sixty (60) days or are being contested in compliance with Section 5.04;


 


23





















 


(c)           pledges
and deposits made in the ordinary course of business in compliance with workers’
compensation, unemployment insurance and other social security or similar laws
or regulations (other than Liens arising under ERISA);


 


(d)           utility
deposits and deposits made to secure the performance of bids, tenders,
contracts, leases, statutory obligations, surety and appeal bonds (or deposits
made to otherwise secure an appeal, stay or discharge in the course of legal
proceeding), performance or completion bonds and other obligations of a like
nature or other cash deposits required to be made, in each case in the ordinary
course of business;


 


(e)           judgment
liens and judicial attachment liens in respect of judgments that do not
constitute an Event of Default under clause (k) of Article VII;


 


(f)            easements,
zoning restrictions, rights-of-way, reservations, subdivisions, and similar
encumbrances or rights of others for rights-of-way, utilities and other similar
purposes, or zoning or other restrictions as to the use of owned or leased real
property and minor defects and irregularities in title on real property imposed
by law or arising in the ordinary course of business that do not secure any
monetary obligations and do not materially detract from the value of the
affected property or interfere with the ordinary conduct of business of the
Borrower or any Subsidiary; and


 


(g)           Liens
in favor of the Administrative Agent granted pursuant to any Loan Document.


 


“Permitted Investments” means:


 


(a)           investments
in direct obligations of the United States of America or of any agency or
instrumentality thereof whose obligations constitute full faith and credit
obligations of the United States of America, provided that any such obligations
shall mature within one year of the date of issuance thereof;


 


(b)           investments
in commercial paper rated at least Aa2 by Moody’s and at least A by S&P
maturing within one year of the date of issuance thereof;


 


(c)           investments
in certificates of deposit, issued by any Lender or by any United States
commercial bank having capital and surplus of not less than $100,000,000 which
have a maturity of one year or less or in banker’s acceptances endorsed by any
Lender or other such commercial bank and maturing within six months of the date
of acceptance;


 


(d)           investments
in repurchase obligations, including whole mortgage loans, with a term of not
more than 30 days for underlying securities of the types described in subsection (a) above
entered into with any bank meeting the qualifications specified in subsection (c) above,
provided all such agreements require physical delivery of the securities
securing such repurchase agreement, except those delivered through the Federal
Reserve Book Entry System;


 


(e)           investments
in Dutch Auction reset securities with a reset date no greater than 180 days
rated at least Aa by Moody’s and at least A by S&P;


 


24





















 


(f)            marketable
general obligations of a state or municipality of the United States, or any
political subdivision of any of the foregoing, unconditionally secured by the
full faith and credit of such state or municipality or political subdivision
and marketable corporate debt securities having an A credit rating or better by
S&P or Moody’s Investors Service; and


 


(g)           investments
in money market funds that invest solely in investments of the type described
in the immediately preceding subsections (a), (b), (c), (d), (e) and (f) above.


 


“Permitted Restricted Payments Amount”
means, with respect to any Restricted Payment subject to Section 6.06(o),
(a) an unlimited amount, so long as, immediately before and immediately
after giving effect to the making of such Restricted Payment and to any related
Borrowing, the Cash Availability Amount is greater than $135,000,000, (b) $10,000,000
during any fiscal year (excluding the aggregate amount of all Restricted
Payments previously made pursuant to the foregoing clause (a) during such
fiscal year) so long as, immediately before and immediately after giving effect
to the making of such Restricted Payment and to any related Borrowing, the Cash
Availability Amount is less than or equal to $135,000,000 and greater than
$85,000,000 and (c) zero during any fiscal year (excluding the aggregate
amount of all Restricted Payments previously made during such fiscal year
pursuant to the foregoing clauses (a) and (b)) if the Cash Availability
Amount is less than $85,000,000 immediately before or immediately after giving
effect to such Restricted Payment and to any related Borrowing; provided
that any amount not utilized under clause (b) during any fiscal year may
be carried over to the next succeeding fiscal year with any Restricted Payment
during such succeeding fiscal year first being allocated against the amount
permitted for such fiscal year before being allocated to such carryforward.


 


“Permitted Sale and Leaseback Transaction”
means an arrangement entered into by the Borrower or any of its Subsidiaries
with any Person providing for the Borrower or such Subsidiary to lease or rent
property, plant and equipment that the Borrower or such Subsidiary has or will
sell or otherwise transfer to such Person, provided that the aggregate value of
property, plant and equipment sold or otherwise transferred pursuant to such
arrangements shall not exceed $20,000,000 during any fiscal year.


 


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


 


“Phosphogypsum Stack Liability” means
the present value of the estimated cost of closing phosphogypsum stacks based
upon formal closure plans for closure, wastewater management, long-term
maintenance and monitoring, as reported in the Parent’s financial statements in
accordance with GAAP.


 


“Phosphogypsum Stack Rules” means
Chapter 17-673 of the Florida Administrative Code, as amended.


 


“Plan” means any employee pension
benefit plan (other than a Multiemployer Plan) subject to the provisions of
Title IV of ERISA or Section 412 of the Code or Section 302 of
ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if
such plan were


 


25










 













 


terminated, would under
Section 4069 of ERISA be deemed to be) an “employer” as defined in
Section 3(5) of ERISA.


 


“Pooling Agreement” means that certain Spare Parts Pooling
Agreement, dated as of August 15, 1968, by and among Commercial Solvents
Corporation, First Nitrogen Corporation, the Borrower (formerly known as
Central Farmers Fertilizer Company), Miscoa and Triad Chemical, as amended,
restated, supplemented or otherwise modified from time to time.


 


“PP&E Component” means, at the time of any determination, an
amount equal to the lesser of:


 


(i)            $75,000,000;
and


 


(ii)           the
sum of (A) the lesser of (1) $50,000,000 and (2) 20% of the “market
value in continued use” of the Eligible Donaldsonville Fixed Assets (based on
the then most recent independent appraisal thereof received by the
Administrative Agent) plus
(B) the lesser of (1) $50,000,000 and (2) 75% of the fair market
value of the Eligible Other Real Property (based on the then most recent
independent appraisal thereof received by the Administrative Agent).


 


“Prime Rate” means the rate of interest per annum publicly
announced from time to time by Chase as its prime rate; each change in the
Prime Rate shall be effective from and including the date such change is
publicly announced as being effective.


 


“Projections” has the meaning assigned to such term in Section
5.01(f).


 


“property, plant and equipment” means property of the type
identified as “Property, plant and equipment” on the financial statements of
the Parent and its Subsidiaries.


 


“Protective Advance” has the meaning assigned to such term in Section
2.05.


 


“Register” has the meaning set forth in Section 9.04.


 


“Registration Statement” means that certain Registration
Statement on Form S-1, Registration No. 333-124949, filed with the Securities and
Exchange Commission on May 16, 2005, as amended and in effect on the
Effective Date.


 


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


 


“Reorganization Transaction” has the meaning given such term on
the Registration Statement.


 


“Report” means reports prepared by the Administrative Agent or
another Person engaged by the Administrative Agent showing the results of
appraisals, field examinations or


 


26





















 


audits pertaining to the
Borrower’s assets from information furnished by or on behalf of the Borrower,
after the Administrative Agent has exercised its rights of inspection pursuant
to this Agreement, which Reports may be distributed to the Lenders by the
Administrative Agent.


 


“Required Lenders” means, at any time, Lenders having
Commitments representing a majority of the Aggregate Commitment at such time
or, if the Commitments of the Lenders have been terminated, Lenders
representing a majority of the Aggregate Credit Exposure.


 


“Reserves” means any and all reserves which the Administrative
Agent deems necessary, in its Permitted Discretion, to maintain with respect to
the Collateral or any Loan Party.  Any
modification to the Reserves after the Effective Date shall (i) be made by the
Administrative Agent (in its Permitted Discretion) based on facts,
circumstances or conditions arising (or becoming known to the Administrative
Agent) after the Effective Date and (ii) become effective upon two (2) Business
Days prior written or telephonic notice to the Borrower.


 


“Responsible Officer” means, with respect to any Person, the
chief executive officer, president, principal accounting officer, chief
financial officer, chief internal general counsel, treasurer or controller of
such Person.


 


“Restricted Payment” means any dividend or other distribution
(whether in cash, securities or other property) with respect to any Equity Interests
in any Loan Party or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit,
on account of the purchase, redemption, retirement, acquisition, cancellation
or termination of any such Equity Interests in any Loan Party or any Subsidiary
or any option, warrant or other right to acquire any such Equity Interests in
any Loan Party or any Subsidiary; provided that “Restricted Payment”
shall exclude any ratable dividend, distribution or other similar payment
(including, without limitation, any patronage payment) by CFL to its members or
equityholders.


 


“Revolving Commitment” means, with respect to each Revolving
Lender, the commitment of such Lender to make Revolving Loans and to acquire
participations in Letters of Credit and Swingline Loans hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.10,
(b) increased from time to time pursuant to Section 2.02(b) and (c)
reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04. 
The initial amount of each Revolving Lender’s Revolving Commitment is
set forth on the Commitment Schedule, or in the Assignment and
Assumption or joinder agreement related to any Commitment Increase pursuant to
which such Lender shall have assumed its Revolving Commitment, as
applicable.  The initial aggregate amount
of the Revolving Lenders’ Revolving Commitments is $250,000,000.


 


“Revolving Credit Exposure” means, with respect to any Revolving
Lender at any time, the sum of the outstanding principal amount of such
Revolving Lender’s Revolving Loans and its LC Exposure and an amount equal to
its Applicable Percentage of the aggregate principal amount of Swingline Loans
at such time.


 


27





















 


“Revolving Lenders” means, as of any date of determination,
Lenders having a Revolving Commitment.


 


“Revolving Loan” means a Loan made pursuant to Section
2.02(a).


 


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


 


“Secured Parties” means collectively, (i) the Administrative
Agent, (ii) the Lenders, (iii) the Issuing Banks, (iv) any Lender or an
Affiliate of a Lender with respect to any Banking Services Obligations, and (v)
any Lender or Affiliate of a Lender which is a counterparty to any Swap
Obligation with the Borrower, provided that with respect to clauses (iv)
and (v) the Lender or Affiliate of a Lender party thereto (other than Chase or
its Affiliates) shall have delivered written notice to the Administrative Agent
that such a transaction has been entered into and that it constitutes an
Obligation entitled to the benefits of the Collateral Documents.


 


“Security Agreement” means that certain Pledge and Security
Agreement, dated as of the date hereof, between the Loan Parties and the
Administrative Agent, for the benefit of the Administrative Agent and the other
Secured Parties, and any other pledge or security agreement entered into, after
the date of this Agreement by any other Loan Party (as required by this
Agreement or any other Loan Document), or any other Person, as the same may be
amended, restated or otherwise modified from time to time.


 


“Statutory Reserve Rate” means a fraction (expressed as a decimal),
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including
any marginal, special, emergency or supplemental reserves) expressed as a
decimal established by the Board to which the Administrative Agent is
subject with respect to the Adjusted LIBO Rate, for eurocurrency funding
(currently referred to as “Eurocurrency Liabilities” in Regulation D of
the Board).  Such reserve percentages
shall include those imposed pursuant to such Regulation D.  Eurodollar Loans shall be deemed to
constitute eurocurrency funding and to be subject to such reserve requirements
without benefit of or credit for proration, exemptions or offsets that may be
available from time to time to any Lender under such Regulation D or any
comparable regulation.  The Statutory
Reserve Rate shall be adjusted automatically on and as of the effective date of
any change in any reserve percentage.


 


“Subordinated Indebtedness” of a Person means any Indebtedness
of such Person the payment of which is subordinated to payment of the
Obligations on terms and conditions reasonable satisfactory to the
Administrative Agent.


 


“subsidiary” means, with respect to any Person (the “parent”)
at any date, any corporation, limited liability company, partnership,
association or other entity (a) of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of the
ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, controlled or held,
or (b) that is, as of such date,


 


28





















 


otherwise Controlled by the
parent or one or more subsidiaries of the parent or by the parent and one or
more subsidiaries of the parent.


 


“Subsidiary” means any subsidiary of the Parent, the Borrower or
a Loan Party, as applicable; provided, however, that, (i) CFL
shall not be considered a Subsidiary for purposes of this Agreement, except
that CFL shall be considered a Subsidiary for purposes of calculating Capital
Expenditures and Fixed Charge Coverage and for purposes of the accounting and
financial terms used in connection with making such calculations, (ii) in the
event that the Trinidad Joint Venture becomes a subsidiary of the Parent, the
Borrower or a Loan Party, the Trinidad Joint Venture shall not be considered a
Subsidiary for purposes of this Agreement, and (iii) any other Subsidiary which
is not a Loan Party shall not be considered a Subsidiary for purposes of
calculating Capital Expenditures and Fixed Charge Coverage or for purposes of
the accounting and financial terms used in connection with making such
calculations.


 


“Subsidiary Guarantor” means each Domestic Subsidiary of the
Borrower that guarantees the Obligations pursuant to Article X.


 


“Supporting Letter of Credit” means a standby letter of credit,
in form and substance reasonably satisfactory to the Administrative Agent,
issued by an issuer reasonably satisfactory to the Administrative Agent, in a
stated amount equal to 105% of the LC Shortfall Amount.


 


“Swap Agreement” means any agreement with respect to any swap,
forward, future or derivative transaction or option or similar agreement
involving, or settled by reference to, one or more rates, currencies,
commodities, equity or debt instruments or securities, or economic, financial
or pricing indices or measures of economic, financial or pricing risk or value
or any similar transaction or any combination of these transactions; provided
that no phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of the Borrower or the Subsidiaries shall be a Swap Agreement.


 


“Swap Obligations” of a Person means any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (a) any and all Swap
Agreements, and (b) any and all cancellations, buy backs, reversals,
terminations or assignments of any Swap Agreement transaction.


 


“Swingline Lender” means JPMorgan Chase Bank, N.A., in its
capacity as lender of Swingline Loans hereunder.


 


“Swingline Loan” means a Loan made pursuant to Section
2.06(a).


 


“Taxes” means any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any
Governmental Authority.


 


“Transactions” means the execution, delivery and performance by
the Borrower of this Agreement, the borrowing of Loans and other credit
extensions, the use of the proceeds thereof, and the issuance of Letters of
Credit hereunder and the consummation of (i) the IPO,


 


29





















 


(ii) the Reorganization
Transaction and (iii) the repayment of the Noteholders Obligations and the
termination of the Noteholders Documents.


 


“Trinidad Joint Venture” means the company to be formed as a
joint venture among the Borrower and/or its subsidiaries and certain third
parties for the purpose of designing, constructing and operating an ammonia and
UAN facility in Trinidad and Tobago..


 


“Type”, when used in reference to any Loan or Borrowing, refers
to whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the
Alternate Base Rate.


 


“UCC” means the Uniform Commercial Code as in effect from time
to time in the State of Illinois or any other state the laws of which are
required to be applied in connection with the issue of perfection of security
interests.


 


“Unliquidated Obligations” means, at any time, any Obligations
(or portion thereof) that are contingent in nature or unliquidated at such
time, including any Obligation that is: (i) an obligation to reimburse a bank
for drawings not yet made under a letter of credit issued by it; (ii) any other
obligation (including any guarantee) that is contingent in nature at such time;
or (iii) an obligation to provide collateral to secure any of the foregoing
types of obligations.


 


“Withdrawal Liability” means liability to a Multiemployer Plan
as a result of a complete or partial withdrawal from such Multiemployer Plan,
as such terms are defined in Part I of Subtitle E of Title IV of
ERISA.


 


Section 1.02           Classification
of Loans and Borrowings.  For
purposes of this Agreement, Loans may be classified and referred to by Class (e.g.,
a “Revolving Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class
and Type (e.g., a “Eurodollar Loan”). 
Borrowings also may be classified and referred to by Class (e.g.,
a “Revolving Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or
by Class and Type (e.g., a “Eurodollar Revolving Borrowing”).


 


Section 1.03           Terms
Generally.  The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined.  Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include”, “includes”
and “including” shall be deemed to be followed by the phrase “without
limitation”.  The word “will” shall be
construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b) any reference herein to any Person shall be construed to
include such Person’s successors and assigns, (c) the words “herein”, “hereof”
and “hereunder”, and words of similar import, shall be construed to refer to
this Agreement in its entirety and not to any particular provision hereof, (d)
all references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to, this
Agreement and (e) the words “asset” and “property” shall be construed to have
the same


 


30





















 


meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.


 


Section 1.04           Accounting
Terms; GAAP.  Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.


 


ARTICLE
II.


 


THE CREDITS


 


Section 2.01           The
Facility.  Subject to the terms and
conditions set forth herein, each Lender agrees to make Loans to the Borrower
from time to time during the Availability Period in an aggregate principal
amount that will not result in (i) such Lender’s Credit Exposure exceeding such
Lender’s Commitment or (ii) the sum of the total Credit Exposures
exceeding the Aggregate Commitment.  The
Issuing Banks will issue Letters of Credit hereunder on the terms and
conditions set forth below. The credit facility evidenced hereby shall be
composed of Revolving Loans, Swingline Loans, Protective Advances, and Letters
of Credit as set forth below.


 


Section 2.02           Revolving
Loans.  (a) Subject to the terms
and conditions set forth herein, each Revolving Lender agrees to make Revolving
Loans to the Borrower from time to time during the Availability Period in an
aggregate principal amount that will not result in (i) such Lender’s Revolving
Credit Exposure exceeding such Lender’s Revolving Commitment or (ii) the
total Revolving Credit Exposures exceeding the lesser of (x) the sum of the
total Revolving Commitments of the Revolving Lenders or (y) the Borrowing Base,
subject to the Administrative Agent’s authority, in its sole discretion, to
make Protective Advances pursuant to the terms of Section 2.05.  Within the foregoing limits and subject to
the terms and conditions set forth herein, the Borrower may borrow, prepay and
reborrow Revolving Loans.


 


(b) Commitment Increase. 
From time to time after the Effective Date, the Revolving Commitments
may be increased (but in no event in excess of $75,000,000 in the aggregate for
all such increases) (the “Commitment Increase Cap”) such that the
aggregate Revolving Commitments shall at no time exceed $325,000,000 (any such
increase, a “Commitment Increase”) at the option of the Borrower
pursuant to delivery of written notice of a proposed Commitment Increase to the
Administrative Agent if each of the following conditions have been met:


 


(i)            no Event of Default
shall exist;


 


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(ii)           no Commitment Increase
may be in an amount less than $10,000,000;


 


(iii)          the proposed Commitment
Increase has been consented to in writing by Administrative Agent, each Lender
(if any) who is increasing its Revolving Commitment and/or any other bank or
financial institution acceptable to the Borrower and the Administrative Agent
that has agreed to become a Lender in respect of all or a portion of the
Commitment Increase (a “New Lender”);


 


(iv)          the proposed Commitment
Increase, together with any prior Commitment Increase, shall not exceed the
Commitment Increase Cap; and


 


(v)           Administrative Agent
shall have received amendments to this Agreement and the Loan Documents,
joinder agreements for any New Lender, and, if requested, promissory notes,
agreements, documents and instruments reasonably satisfactory to Administrative
Agent in its reasonable discretion evidencing and setting forth the conditions
of the Commitment Increase.


 


Each of the Borrower, Lenders and Administrative Agent acknowledges and
agrees that each Commitment Increase meeting the conditions set forth in this Section
2.02(b) shall not require the consent of any Lender other than those
Lenders, if any, which have agreed to increase their Revolving Commitments in
connection with such proposed Commitment Increase and shall not constitute an
amendment, modification or waiver subject to Section 9.02 and shall be
effective as of the later of (i) the date specified in the Borrower’s notice of
proposed Commitment Increase and (ii) the date upon which the foregoing
conditions shall have been satisfied or waived by the Lenders which have agreed
to increase their Commitments, or by the Required Lenders in the case of a
waiver of an Event of Default, as applicable. 
The Administrative Agent shall notify the Borrower and each Lender of
the effectiveness of any Commitment Increase. 
After giving effect to any Commitment Increase, the outstanding
Revolving Loans may not be held pro rata in accordance with the new Revolving
Commitments.  In order to remedy the
foregoing, on the effective date of the applicable Commitment Increase, the
Revolving Lenders (including, without limitation, any New Lenders) shall make
advances among themselves so that after giving effect thereto the Revolving
Loans will be held by the Revolving Lenders (including, without limitation, any
New Lenders), pro rata in accordance with the Applicable Percentage hereunder
(after giving effect to the applicable Commitment Increase).  Notwithstanding the provisions of Section
9.04, the advances so made by each Revolving Lender whose Applicable
Percentage has increased shall be deemed to be a purchase of a corresponding
amount of the Revolving Loans of the Revolving Lender or Revolving Lenders
whose Applicable Percentage have decreased and shall not be considered an
assignment for purposes of Section 9.04.


 


Section 2.03           Loans
and Borrowings.


 


(a) Each Revolving Loan shall be made as part of a Borrowing
consisting of Revolving Loans made by the Revolving Lenders ratably in
accordance with their respective Revolving Commitments.  Any Protective Advance shall be made in
accordance with the procedures set forth in Section 2.05.


 


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(b) Subject to Section 2.15, each Revolving Borrowing
shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower
may request in accordance herewith. Each Swingline Loan shall be an ABR
Loan.  Each Lender at its option may make
any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of
such Lender to make such Loan; provided that any exercise of such option
shall not affect the obligation of the Borrower to repay such Loan in
accordance with the terms of this Agreement.


 


(c) At the commencement of each Interest Period for any Eurodollar
Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and not less than $5,000,000.  ABR Revolving Borrowings and Swingline Loans
may be in any amount.  Borrowings of more
than one Type and Class may be outstanding at the same time; provided
that there shall not at any time be more than a total of five (5) Eurodollar
Revolving Borrowings outstanding.


 


(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the Maturity Date.


 


Section 2.04           Requests
for Revolving Borrowings.  To request
a Revolving Borrowing, the Borrower shall notify the Administrative Agent of
such request either in writing (delivered by hand or facsimile) in a form
approved by the Administrative Agent and the Borrower in their reasonable
discretion and signed by the Borrower or by telephone (a) in the case of a
Eurodollar Borrowing, not later than 10:00 a.m., Chicago time, three
Business Days before the date of the proposed Borrowing or (b) in the case
of an ABR Borrowing, not later than 10:00 a.m., Chicago time, on the date
of the proposed Borrowing; provided that any such notice of an ABR
Revolving Borrowing to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.07(e) may be given not later than 9:00
a.m., Chicago time, on the date of the proposed Borrowing.  Each such telephonic Borrowing Request shall
be irrevocable and shall be confirmed promptly by hand delivery or facsimile to
the Administrative Agent of a written Borrowing Request in a form approved by
the Administrative Agent and the Borrower in their reasonable discretion and
signed by the Borrower.  Each such
telephonic and written Borrowing Request shall specify the following
information in compliance with Section 2.02(a):


 


(i)            the
aggregate amount of the requested Borrowing and a breakdown of the separate
wires comprising such Borrowing;


 


(ii)           the
date of such Borrowing, which shall be a Business Day;


 


(iii)          whether
such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and


 


(iv)          in
the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period.”


 


If no election as to the Type of Revolving Borrowing is specified, then
the requested Revolving Borrowing shall be an ABR Borrowing.  If no Interest Period is specified with
respect to any requested Eurodollar Revolving Borrowing, then the Borrower
shall be deemed to have selected


 


33





















 


an Interest Period of one month’s duration.  Promptly following receipt of a Borrowing
Request in accordance with this Section, the Administrative Agent shall advise
each Lender of the details thereof and of the amount of such Lender’s Loan to
be made as part of the requested Borrowing.


 


Section 2.05           Protective
Advances.


 


(a) Subject to the limitations set forth below, the Administrative
Agent is authorized by the Borrower and the Lenders, from time to time in the
Administrative Agent’s sole discretion (but shall have absolutely no obligation
to), to make Loans to the Borrower, on behalf of all Lenders, which the
Administrative Agent, in its Permitted Discretion, deems necessary or
desirable, (i) to preserve or protect the Collateral, or any portion thereof,
(ii) during the existence of any Event of Default, to enhance the likelihood
of, or maximize the amount of, repayment of the Loans and other Obligations, or
(iii) during the existence of an Event of Default, to pay any other amount
chargeable to or required to be paid by the Borrower pursuant to the terms of
this Agreement, including payments of principal, interest, LC Disbursements,
fees, premiums, reimbursable
expenses (including costs, fees, and expenses as described in Section 9.03)
and other sums payable under the Loan Documents (any of such Loans are herein
referred to as “Protective Advances”); provided that no
Protective Advance shall cause the Aggregate Credit Exposure to exceed the
Aggregate Commitment; provided, further, that the aggregate
amount of Protective Advances outstanding at any time, which were made pursuant
to clauses (i) and (ii) above, shall not at any time exceed $15,000,000.  Protective Advances may be made even if the
conditions precedent set forth in Section 4.02 have not been
satisfied.  The Protective Advances shall
be secured by the Liens in favor of the Administrative Agent in and to the
Collateral and shall constitute Obligations hereunder.  All Protective Advances shall be ABR
Borrowings.  The Administrative Agent’s
authorization to make Protective Advances may be revoked at any time by the
Required Lenders.  Any such revocation
must be in writing and shall become effective prospectively upon the
Administrative Agent’s receipt thereof. 
At any time that there is sufficient Availability and the conditions
precedent set forth in Section 4.02 have been satisfied, the
Administrative Agent may request the Revolving Lenders to make a Revolving Loan
to repay a Protective Advance.  At any
other time the Administrative Agent may require the Lenders to fund their risk
participations described in Section 2.05(b).


 


(b) Upon the making of a Protective Advance by the Administrative
Agent (whether before or after the
occurrence of a Default), each Lender shall be deemed, without further action
by any party hereto, to have unconditionally and irrevocably purchased from the
Administrative Agent without recourse or warranty, an undivided interest and
participation in such Protective Advance in proportion to its Applicable
Percentage of the Aggregate Commitment. 
From and after the date, if any, on which any Lender is required to fund
its participation in any Protective Advance purchased hereunder, the
Administrative Agent shall promptly distribute to such Lender, such Lender’s
Applicable Percentage of all payments of principal and interest and all
proceeds of Collateral received by the Administrative Agent in respect of such
Protective Advance.


 


Section 2.06           Swingline
Loans.


 


(a) Subject to the terms and conditions set forth herein, the
Swingline Lender agrees to make Swingline Loans to the Borrower from time to
time during the Availability


 


34





















 


Period, in an aggregate principal amount at
any time outstanding that will not result in (i) the aggregate principal
amount of outstanding Swingline Loans exceeding $25,000,000 or (ii) the sum of
the total Revolving Credit Exposures exceeding the lesser of the total
Revolving Commitments and Availability; provided that the Swingline
Lender shall not be required to make a Swingline Loan to refinance an
outstanding Swingline Loan.  Within the
foregoing limits and subject to the terms and conditions set forth herein, the
Borrower may borrow, prepay and reborrow Swingline Loans.  To request a Swingline Loan, the Borrower
shall notify the Administrative Agent of such request by telephone (confirmed
by facsimile), not later than 11:00 a.m., Chicago time, on the day of a
proposed Swingline Loan.  Each such
notice shall be irrevocable and shall specify the requested date (which shall
be a Business Day) and amount of the requested Swingline Loan.  The Administrative Agent will promptly advise
the Swingline Lender of any such notice received from the Borrower.  The Swingline Lender shall make each
Swingline Loan available to the Borrower by means of a credit to the Funding
Account (or, in the case of a Swingline Loan made to finance the reimbursement
of an LC Disbursement as provided in Section 2.07(e), by remittance
to the applicable Issuing Bank, and in the case of repayment of another Loan or
fees or expenses as provided by Section 2.19(c), by remittance to the
Administrative Agent to be distributed to the Lenders) by 2:00 p.m.,
Chicago time, on the requested date of such Swingline Loan.


 


(b) The Swingline Lender may by written notice given to the
Administrative Agent not later than 9:00 a.m., Chicago time, on any
Business Day require the Revolving Lenders to acquire participations on such
Business Day in all or a portion of the Swingline Loans outstanding.  Such notice shall specify the aggregate
amount of Swingline Loans in which Revolving Lenders will participate.  Promptly upon receipt of such notice, the
Administrative Agent will give notice thereof to each Revolving Lender,
specifying in such notice such Lender’s Applicable Percentage of such Swingline
Loan or Loans.  Each Revolving Lender
hereby absolutely and unconditionally agrees, upon receipt of notice as
provided above, to pay to the Administrative Agent, for the account of the
Swingline Lender, such Lender’s Applicable Percentage of such Swingline Loan or
Loans.  Each Revolving Lender
acknowledges and agrees that its obligation to acquire participations in
Swingline Loans pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including the occurrence
and continuance of an Event of Default or reduction or termination of the
Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. 
Each Revolving Lender shall comply with its obligation under this
paragraph by wire transfer of immediately available funds, in the same manner
as provided in Section 2.08 with respect to Loans made by such
Lender (and Section 2.08 shall apply, mutatis  mutandis,
to the payment obligations of the Lenders), and the Administrative Agent shall
promptly pay to the Swingline Lender the amounts so received by it from the
Revolving Lenders.  The Administrative
Agent shall notify the Borrower of any participations in any Swingline Loan
acquired pursuant to this paragraph, and thereafter payments in respect of such
Swingline Loan shall be made to the Administrative Agent and not to the
Swingline Lender.  Any amounts received
by the Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Revolving
Lenders that shall have made their payments pursuant to this paragraph and to
the Swingline Lender, as their interests may appear; provided that any such


 


35





















 


payment so remitted shall be repaid to the
Swingline Lender or to the Administrative Agent, as applicable, if and to the
extent such payment is required to be refunded to the Borrower for any
reason.  The purchase of participations
in a Swingline Loan pursuant to this paragraph shall not relieve the Borrower
of any default in the payment thereof.


 


Section 2.07           Letters
of Credit.


 


(a) General.  Subject
to the terms and conditions set forth herein, the Borrower may request the
issuance of, and the applicable Issuing Bank shall issue, Letters of Credit for
the account of the Borrower or for the account of the Borrower and any
Subsidiary Guarantor, in a form reasonably acceptable to the applicable Issuing
Bank, at any time and from time to time during the Availability Period.  In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower
to, or entered into by the Borrower with, any Issuing Bank relating to any
Letter of Credit, the terms and conditions of this Agreement shall control.


 


(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions.  To request the issuance
of a Letter of Credit (or the amendment, renewal or extension of an outstanding
Letter of Credit), the Borrower shall hand deliver or facsimile (or transmit by
electronic communication, if arrangements for doing so have been approved by
such Issuing Bank) to any Issuing Bank and the Administrative Agent (prior to
9:00 a.m., Chicago time, at least three Business Days prior to the
requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, and specifying the date of issuance,
amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with
paragraph (c) of this Section), the amount of such Letter of Credit, the
name and address of the beneficiary thereof and such other information as shall
be necessary to prepare, amend, renew or extend such Letter of Credit.  If requested by an Issuing Bank, the Borrower
also shall submit a letter of credit application on such Issuing Bank’s
standard form in connection with any request for a Letter of Credit.  A Letter of Credit shall be issued, amended,
renewed or extended only if (and upon issuance, amendment, renewal or extension
of each Letter of Credit the Borrower shall be deemed to represent and warrant
that), after giving effect to such issuance, amendment, renewal or extension
(i) the LC Exposure shall not exceed $50,000,000 and (ii) the total
Revolving Credit Exposures shall not exceed the lesser of the total Revolving
Commitments and the Borrowing Base.


 


(c) Expiration Date. 
Each Letter of Credit shall expire at or prior to the close of business
on the earlier of (i) the date one year after the date of the issuance of
such Letter of Credit (or, in the case of any renewal or extension thereof, one
year after such renewal or extension), provided that any Letter of
Credit with a one-year term may provide for the renewal thereof for additional
one-year periods (which shall in no event extend beyond the date referred to in
clause (ii) below), and (ii) the date that is five (5) Business Days prior
to the Maturity Date (unless at the time of issuance of such Letter of Credit,
the Borrower shall deposit in the LC Collateral Account an amount in cash equal
to 105% of the amount of such Letter of Credit, to be held by the
Administrative Agent as cash collateral for the LC Exposure with respect to
such Letter of Credit).


 


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(d) Participations. 
By the issuance of a Letter of Credit (or an amendment to a Letter of
Credit increasing the amount thereof) and without any further action on the
part of such Issuing Bank or the Revolving Lenders, such Issuing Bank hereby
grants to each Revolving Lender, and each Revolving Lender hereby acquires from
such Issuing Bank, a participation in such Letter of Credit equal to such
Lender’s Applicable Percentage of the aggregate amount available to be drawn
under such Letter of Credit.  In
consideration and in furtherance of the foregoing, each Revolving Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent, for
the account of the Issuing Bank, such Lender’s Applicable Percentage of each LC
Disbursement made by such Issuing Bank and not reimbursed by the Borrower on the
date due as provided in paragraph (e) of this Section, or of any reimbursement
payment required to be refunded to the Borrower for any reason.  Each Revolving Lender acknowledges and agrees
that its obligation to acquire participations pursuant to this paragraph in
respect of Letters of Credit is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including any amendment, renewal or
extension of any Letter of Credit or the occurrence and continuance of a
Default or reduction or termination of the Commitments, and that each such
payment shall be made without any offset, abatement, withholding or reduction
whatsoever.


 


(e) Reimbursement. 
If an Issuing Bank shall make any LC Disbursement in respect of a Letter
of Credit, the Borrower shall reimburse such LC Disbursement by paying to the
Administrative Agent an amount equal to such LC Disbursement not later than
noon, Chicago time, on the date that such LC Disbursement is made, if the
Borrower shall have received notice of such LC Disbursement prior to
9:00 a.m., Chicago time, on such date, or, if such notice has not been
received by the Borrower prior to such time on such date, then not later than
noon, Chicago time, on (i) the Business Day that the Borrower receives such
notice, if such notice is received prior to 9:00 a.m., Chicago time, on
the day of receipt, or (ii) the Business Day immediately following the day that
the Borrower receives such notice, if such notice is not received prior to such
time on the day of receipt; provided that the Borrower may, subject to
the conditions to borrowing set forth herein, request in accordance with Section
2.04 that such payment be financed with an ABR Revolving Borrowing or
Swingline Loan in an equivalent amount and, to the extent so financed, the
Borrower’s obligation to make such payment shall be discharged and replaced by
the resulting ABR Revolving Borrowing or Swingline Loan.  If the Borrower fails to make such payment
when due, the Administrative Agent shall notify each Revolving Lender of the
applicable LC Disbursement, the payment then due from the Borrower in respect
thereof and such Lender’s Applicable Percentage thereof.  Promptly following receipt of such notice,
each Revolving Lender shall pay to the Administrative Agent its Applicable
Percentage of the payment then due from the Borrower, in the same manner as
provided in Section 2.08 with respect to Loans made by such Lender
(and Section 2.08 shall apply, mutatis  mutandis, to
the payment obligations of the Revolving Lenders), and the Administrative Agent
shall promptly pay to the Issuing Bank the amounts so received by it from the
Revolving Lenders.  Promptly following
receipt by the Administrative Agent of any payment from the Borrower pursuant
to this paragraph, the Administrative Agent shall distribute such payment to
such Issuing Bank or, to the extent that Revolving Lenders have made payments
pursuant to this paragraph to reimburse such Issuing Bank, then to such Lenders
and such Issuing Bank as their interests may appear.  Any payment made by a Revolving Lender
pursuant to this paragraph to reimburse an Issuing Bank for any LC Disbursement
(other than the funding of ABR Revolving Loans or a Swingline Loan as
contemplated above) shall not constitute a Loan and shall not relieve the
Borrower of its obligation to reimburse such LC Disbursement.


 


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(f) Obligations Absolute. 
The Borrower’s obligation to reimburse LC Disbursements as provided in
paragraph (e) of this Section shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement under any and all circumstances whatsoever and irrespective of
(i) any lack of validity or enforceability of any Letter of Credit or this
Agreement, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment by an Issuing Bank under a Letter of Credit against
presentation of a draft or other document that does not comply with the terms
of such Letter of Credit, or (iv) any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the
provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower’s obligations hereunder.  Neither the Administrative Agent, the
Revolving Lenders nor the Issuing Banks, nor any of their Related Parties,
shall have any liability or responsibility by reason of or in connection with
the issuance or transfer of any Letter of Credit or any payment or failure to
make any payment thereunder (irrespective of any of the circumstances referred
to in the preceding sentence), or any error, omission, interruption, loss or
delay in transmission or delivery of any draft, notice or other communication
under or relating to any Letter of Credit (including any document required to
make a drawing thereunder), any error in interpretation of technical terms or
any consequence arising from causes beyond the control of an Issuing Bank; provided
that this Section shall not be construed to excuse an Issuing Bank from
liability to the Borrower to the extent of any direct damages (as opposed to
consequential damages, claims in respect of which are hereby waived by the
Borrower to the extent permitted by applicable law) suffered by the Borrower
that are caused by such Issuing Bank’s (i) failure to exercise care when
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof or (ii) failure to pay under any Letter of
Credit issued by it after the presentation to it of documents strictly
complying with the terms and conditions of such Letter of Credit.  The parties hereto expressly agree that, in
the absence of gross negligence or willful misconduct on the part of an Issuing
Bank, such Issuing Bank shall be deemed to have exercised care in each such determination.  In furtherance of the foregoing and without
limiting the generality thereof, the parties agree that, with respect to
documents presented which appear on their face to be in substantial compliance
with the terms of a Letter of Credit, the Issuing Bank may, in its sole
discretion, either accept and make payment upon such documents without
responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and refuse to make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.


 


(g) Disbursement Procedures.  Each Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit issued by such Issuing Bank.  Such Issuing Bank shall promptly notify the
Administrative Agent and the Borrower by telephone (confirmed by facsimile) of
such demand for payment and whether such Issuing Bank has made or will make an
LC Disbursement thereunder; provided that any failure to give or delay
in giving such notice shall not relieve the Borrower of its obligation to
reimburse such Issuing Bank and the Revolving Lenders with respect to any such
LC Disbursement.


 


(h) Interim Interest. 
If an Issuing Bank shall make any LC Disbursement, then, unless the
Borrower shall reimburse such LC Disbursement in full on the date such LC


 


38





















 


Disbursement is made, the unpaid amount
thereof shall bear interest, for each day from and including the date such LC
Disbursement is made to but excluding the date that the Borrower reimburses
such LC Disbursement, at the rate per annum then applicable to ABR Revolving
Loans; provided that, if the Borrower fails to reimburse such LC Disbursement
when due pursuant to paragraph (e) of this Section, then Section
2.14(d) shall apply.  Interest
accrued pursuant to this paragraph shall be for the account of such Issuing
Bank, except that interest accrued on and after the date of payment by any
Revolving Lender pursuant to paragraph (e) of this Section to reimburse such
Issuing Bank shall be for the account of such Lender to the extent of such
payment.


 


(i) Replacement of an Issuing Bank.  An Issuing Bank may be replaced at any time
by written agreement among the Borrower, the Administrative Agent, the replaced
Issuing Bank and the successor Issuing Bank. 
The Administrative Agent shall notify the Revolving Lenders of any such
replacement of an Issuing Bank.  At the
time any such replacement shall become effective, the Borrower shall pay all
unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section
2.13(b).  From and after the
effective date of any such replacement, (i) the successor Issuing Bank shall
have all the rights and obligations of an Issuing Bank under this Agreement
with respect to Letters of Credit to be issued thereafter and (ii) references
herein to the term “Issuing Bank” shall be deemed to refer to such successor or
to any previous Issuing Bank, or to such successor and all previous Issuing
Banks, as the context shall require. 
After the replacement of an Issuing Bank hereunder, the replaced Issuing
Bank shall remain a party hereto and shall continue to have all the rights and
obligations of an Issuing Bank under this Agreement with respect to Letters of
Credit issued by it prior to such replacement, but shall not be required to
issue additional Letters of Credit.


 


(j) Cash Collateralization. 
(i)  If any Event of Default shall
occur and be continuing, within two (2) Business Days of the Business Day that
the Borrower receives notice from the Administrative Agent or the Required
Lenders demanding the deposit of cash collateral pursuant to this paragraph,
the Borrower shall deposit in an account with the Administrative Agent, in the
name of the Administrative Agent and for the benefit of the Revolving Lenders
(the “LC Collateral Account”), an amount in cash equal to 105% of the LC
Shortfall Amount as of such date; provided that the obligation to
deposit such cash collateral shall become effective immediately, and such
deposit shall become immediately due and payable, without demand or other
notice of any kind, upon the occurrence of any Event of Default with respect to
the Borrower described in clause (h) or (i) of Article VII.  Such deposit shall be held by the
Administrative Agent as collateral for the payment and performance of the
Obligations.  The Administrative Agent
shall have exclusive dominion and control, including the exclusive right of
withdrawal, over such account and the Borrower hereby grants the Administrative
Agent a security interest in the LC Collateral Account.  Other than any interest earned on the
investment of such deposits, which investments shall be made at the option and
sole discretion of the Administrative Agent and at the Borrower’s risk and
expense, such deposits shall not bear interest. 
Interest or profits, if any, on such investments shall accumulate in
such account.  Moneys in such account
shall be applied by the Administrative Agent to reimburse the Issuing Banks for
LC Disbursements for which they have not been reimbursed and, to the extent not
so applied, shall be held for the satisfaction of the reimbursement obligations
of the Borrower for the LC Exposure at such time or, if the maturity of the
Loans has been accelerated, be applied to satisfy other Obligations.  If the Borrower is required to provide an
amount of cash collateral


 


39





















 


hereunder as a result of the occurrence of an
Event of Default, such amount (to the extent not applied as aforesaid) shall be
returned to the Borrower within three Business Days after all such Defaults
have been cured or waived, unless needed to satisfy

Section 2.07(j)(ii).


 


(ii)           If, notwithstanding the
provisions of this Section 2.07, any Letter of Credit is
outstanding on the Maturity Date, then on such date the Borrower shall deposit
with the Administrative Agent, for the benefit of the Administrative Agent and
the Revolving Lenders, with respect to all LC Exposure, as the Administrative
Agent in its discretion shall specify, either (i) a Supporting Letter of Credit
(under which the Administrative Agent is entitled to draw amounts necessary to
reimburse the Issuing Bank for LC Disbursements for which it has not been
reimbursed and any fees and expenses associated with such outstanding Letter of
Credit), or (ii) cash, in immediately available funds, in an amount equal to
105% of the LC Shortfall Amount to be held in the LC Collateral Account.  Such Supporting Letter of Credit or deposit
of cash shall be held by the Administrative Agent, for the benefit of the
Administrative Agent and the Revolving Lenders, as collateral for the payment
and performance of the obligations of the Borrower under any such Letter of
Credit remaining outstanding.


 


Section 2.08           Funding
of Borrowings.  (a) Each Lender shall
make each Loan to be made by it hereunder on the proposed date thereof by wire
transfer of immediately available funds by 11:00 a.m., Chicago time, to the
account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders in an amount equal to such Lender’s Applicable
Percentage; provided that, Swingline Loans shall be made as provided in Section 2.06.  The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the amounts so received, in
like funds, to the Funding Account; provided that ABR Revolving Loans
made to finance the reimbursement of (i) an LC Disbursement as provided in Section
2.07(e) shall be remitted by the Administrative Agent to the Issuing Bank
making such LC Disbursement and (ii) a Protective Advance shall be retained by
the Administrative Agent.


 


(b) Unless the Administrative Agent shall have received notice
from a Lender prior to the proposed date of any Borrowing that such Lender will
not make available to the Administrative Agent 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 paragraph (a) of this Section and
may, in reliance upon such assumption, make available to the Borrower a
corresponding amount.  In such event, if
a Lender has not in fact made its share of the applicable Borrowing available
to the Administrative Agent (a “Defaulting Lender”), then the applicable
Lender and the Borrower severally agree to pay to the Administrative Agent
forthwith on demand such corresponding amount with interest thereon, for each
day from and including the date such amount is made available to the Borrower
to but excluding the date of payment to the Administrative Agent, at (i) in the
case of such Lender, the greater of the Federal Funds Effective Rate and a rate
determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation or (ii) in the case of the Borrower, the
interest rate applicable to ABR Loans. 
If such Lender pays such amount to the Administrative Agent, then such
amount shall constitute such Lender’s Loan included in such Borrowing.  The Administrative Agent shall not be
obligated to transfer to a Defaulting Lender any payments made by the Borrower
to the Administrative Agent for the Defaulting Lender’s benefit, and, in the
absence of such transfer to the Defaulting Lender, the Administrative Agent
shall transfer


 


40





















 


any such payments to each other
non-Defaulting Lender ratably in accordance with their Applicable Percentage of
the Commitments (but only to the extent that such Defaulting Lender’s Borrowing
was funded by the other Lenders) or, if so directed by the Borrower and if no
Default has occurred and is continuing (and to the extent such Defaulting
Lender’s Borrowing was not funded by the other Lenders), retain the same to be
re-advanced to the Borrower as if such Defaulting Lender had made Loans to the
Borrower.  Subject to the foregoing, the
Administrative Agent may hold and, in its Permitted Discretion, setoff such
Defaulting Lender’s funding shortfall against that Defaulting Lender’s
Applicable Percentage of all payments received from the Borrower or re-lend to
the Borrower for the account of such Defaulting Lender the amount of all such
payments received and retained by the Administrative Agent for the account of
such Defaulting Lender. Until a Defaulting Lender cures its failure to fund its
Applicable Percentage of any Borrowing (i) solely for the purposes of voting or
consenting to matters with respect to the Loan Documents, such Defaulting
Lender shall be deemed not to be a “Lender” and such Defaulting Lender’s
Commitment shall be deemed to be zero, (ii) such Defaulting Lender shall not be
entitled to any portion of the commitment fee and (iii) the commitment fee
shall accrue in favor of the Lenders which have funded their respective
Applicable Percentages of such requested Borrowing and shall be allocated among
such non-Defaulting Lenders ratably based on their Applicable Percentage of the
Commitments. This Section shall remain effective with respect to such
Defaulting Lender until (x) the Obligations under this Agreement shall have
been declared or shall have become immediately due and payable, (y) the
non-Defaulting Lenders, the Administrative Agent, and the Borrower shall have
waived such Defaulting Lender’s default in writing, or (z) the Defaulting
Lender makes its Applicable Percentage of the applicable Borrowing and pays to
Administrative Agent all amounts owing by the Defaulting Lender in respect
thereof.  The operation of this Section shall
not be construed to increase or otherwise affect the Commitment of any Lender,
to relieve or excuse the performance by such Defaulting Lender or any other
Lender of its duties and obligations hereunder, or to relieve or excuse the
performance by the Borrower of its duties and obligations hereunder.


 


Section 2.09           Interest
Elections.


 


(a) Each Revolving Borrowing initially shall be of the Type
specified in the applicable Borrowing Request and, in the case of a Eurodollar
Revolving Borrowing, shall have an initial Interest Period as specified in such
Borrowing Request.  Thereafter, the
Borrower may elect to convert such Borrowing to a different Type or to continue
such Borrowing and, in the case of a Eurodollar Revolving Borrowing, may elect
Interest Periods therefor, all as provided in this Section.  The Borrower may elect different options with
respect to different portions of the affected Borrowing, in which case each
such portion shall be allocated ratably among the Lenders holding the Loans
comprising such Borrowing, and the Loans comprising each such portion shall be
considered a separate Borrowing.  This
Section shall not apply to Swingline Borrowings or Protective Advances, which
may not be converted or continued.


 


(b) To make an election pursuant to this Section, the Borrower
shall notify the Administrative Agent of such election by telephone by the time
that a Borrowing Request would be required under Section 2.04 if the
Borrower were requesting a Revolving Borrowing of the Type resulting from such
election to be made on the effective date of such election.  Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by


 


41





















 


hand delivery or facsimile to the
Administrative Agent of a written Interest Election Request in a form approved
by the Administrative Agent and the Borrower in their reasonable discretion and
signed by the Borrower.


 


(c) Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.03:


 


(i)            the Borrowing to which
such Interest Election Request applies and, if different options are being
elected with respect to different portions thereof, the portions thereof to be
allocated to each resulting Borrowing (in which case the information to be
specified pursuant to clauses (iii) and (iv) below shall be specified for each
resulting Borrowing);


 


(ii)           the effective date of
the election made pursuant to such Interest Election Request, which shall be a
Business Day;


 


(iii)          whether the resulting
Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and


 


(iv)          if the resulting
Borrowing is a Eurodollar Borrowing, the Interest Period to be applicable
thereto after giving effect to such election, which shall be a period
contemplated by the definition of the term “Interest Period”.


 


If any such Interest Election Request requests a Eurodollar Borrowing
but does not specify an Interest Period, then the Borrower shall be deemed to
have selected an Interest Period of one month’s duration.


 


(d) Promptly following receipt of an Interest Election Request,
the Administrative Agent shall advise each Lender of the details thereof and of
such Lender’s portion of each resulting Borrowing.


 


(e) If the Borrower fails to deliver a timely Interest Election
Request with respect to a Eurodollar Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing.  Notwithstanding any
contrary provision hereof, if an Event of Default has occurred and is
continuing and the Administrative Agent, at the request of the Required Lenders,
so notifies the Borrower, then, so long as an Event of Default is continuing
(i) no outstanding Revolving Borrowing may be converted to or continued as a
Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Revolving
Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto.


 


Section 2.10           Termination
and Reduction of Commitments.


 


(a) Unless previously terminated, the Commitments shall terminate
on the Maturity Date.


 


(b) The Borrower may at any time terminate the Commitments upon
(i) the payment in full of all outstanding Loans, together with accrued and
unpaid interest thereon, (ii) the cancellation and return of all outstanding
Letters of Credit (or alternatively, with respect to


 


42





















 


each such Letter of Credit, the furnishing to
the Administrative Agent of a cash deposit or Supporting Letter of Credit as
required by Section 2.07(j)(ii)), (iii) the payment in full of the
accrued and unpaid fees, and (iv) the payment in full of all reimbursable
expenses and other Obligations together with accrued and unpaid interest
thereon.


 


(c) The Borrower may from time to time reduce, the Revolving
Commitments; provided that (i) each reduction of the Revolving
Commitments shall be in an amount that is an integral multiple of $1,000,000
and not less than $5,000,000 and (ii) the Borrower shall not reduce the
Revolving Commitments if, after giving effect to any concurrent prepayment of
the Revolving Loans in accordance with Section 2.11, the sum of the
Revolving Credit Exposures would exceed the lesser of the total Revolving
Commitments and the Borrowing Base.


 


(d) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) or (c)
of this Section at least five Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof.  Promptly following receipt of
any notice, the Administrative Agent shall advise the Lenders of the contents
thereof.  Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable; provided that a
notice of termination of the Commitments delivered by the Borrower may state
that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Administrative Agent on or prior to the specified effective date) if
such condition is not satisfied.  Any
termination or reduction of the Commitments shall be permanent.  Each reduction of the Commitments shall be
made ratably among the Lenders in accordance with their respective Commitments.


 


Section 2.11           Repayment of
Loans; Evidence of Debt.  (a) The
Borrower hereby unconditionally promises to pay (i) to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each
Revolving Loan on the Maturity Date, (ii) to the Administrative Agent the then
unpaid amount of each Protective Advance on the earlier of the Maturity Date
and demand by the Administrative Agent, and (iii) to the Swingline Lender the
then unpaid principal amount of each Swingline Loan on the earlier of the
Maturity Date and the first date after such Swingline Loan is made that is the
15th or last day of a calendar month and is at least two (2)
Business Days after such Swingline Loan is made; provided that on each
date that a Revolving Loan is made, the Borrower shall repay all Swingline
Loans then outstanding.  All unpaid
Obligations shall be paid in full in cash by the Borrower on the Maturity Date.


 


(b) At all times that cash dominion is in effect pursuant to
Section 7.1 of the Security Agreement, each Business Day, at or before 11:00
a.m., Chicago time, the Administrative Agent shall apply all immediately
available funds credited to the Collection Account first to prepay any
Protective Advances that may be outstanding, pro rata, and second to
prepay the Revolving Loans (including Swing Line Loans).


 


(c) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower to
such Lender resulting from each Loan made by such Lender, including the amounts
of principal and interest payable and paid to such Lender from time to time
hereunder.


 


43





















 


(d) The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made hereunder, the Class and
Type thereof and the Interest Period applicable thereto, (ii) the amount
of any principal or interest due and payable or to become due and payable from
the Borrower to each Lender hereunder and (iii) the amount of any sum
received by the Administrative Agent hereunder for the account of the Lenders
and each Lender’s share thereof.


 


(e) The entries made in the accounts maintained pursuant to
paragraph (c) or (d) of this Section shall be prima  facie
evidence of the existence and amounts of the obligations recorded therein; provided
that the failure of any Lender or the Administrative Agent to maintain such
accounts or any error therein shall not in any manner affect the obligation of
the Borrower to repay the Loans in accordance with the terms of this Agreement.


 


(f) Any Lender may request that Loans made by it be evidenced by a
promissory note.  In such event, the
Borrower shall prepare, execute and deliver to such Lender a promissory note
payable to the order of such Lender (or, if requested by such Lender, to such
Lender and its registered assigns) and in a form approved by the Administrative
Agent and the Borrower in their reasonable discretion.  Thereafter, the Loans evidenced by such
promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more
promissory notes in such form payable to the order of the payee named therein
(or, if such promissory note is a registered note, to such payee and its
registered assigns) except to the extent that any such Lender subsequently
returns any such promissory note for cancellation and requests that such Loans
once again be evidenced as described in paragraphs (c) and (d) above.


 


Section 2.12           Prepayment
of Loans.  (a) The Borrower shall
have the right at any time and from time to time to prepay any Borrowing in
whole or in part, subject to prior notice in accordance with paragraph (d) of
this Section.


 


(b) (i)  The Borrower shall
immediately repay the Revolving Loans, LC Exposure and/or Swingline Loans if at
any time the total Revolving Credit Exposure of all Revolving Lenders exceeds the
lesser of (A) the aggregate Revolving Commitments and (B) the Borrowing Base,
to the extent required to eliminate such excess.


 


(ii)           Immediately upon
receipt by any Loan Party of the Net Cash Proceeds of any asset disposition
(other than (i) sales of inventory in the ordinary course of business and (ii)
any asset disposition or series of related asset dispositions resulting in Net
Cash Proceeds of less than $500,000) at a time that cash dominion is in effect
pursuant to Section 7.1 of the Security Agreement, the Borrower shall prepay
the Obligations in an amount equal to 100% of such Net Cash Proceeds of such
asset disposition as set forth in paragraph (c) below.


 


(iii)          If any Loan Party issues
Equity Interests (other than Equity Interests issued in the IPO and Equity
Interests issued by a Loan Party to another Loan Party) or any Loan Party
issues Indebtedness (other than Indebtedness permitted by Section 6.01)
at a time that cash dominion is in effect pursuant to Section 7.1 of the
Security Agreement, the Borrower shall prepay the Obligations in an amount
equal to 100% of the Net Cash Proceeds of such


 


44





















 


issuance no later than the Business Day
following the date of receipt of such Net Cash Proceeds as set forth in
paragraph (c) below.


 


(iv)          Any insurance or
condemnation proceeds to be applied to the Obligations in accordance with Section
5.09 shall be applied as set forth in clause (c) below.


 


(v)           Nothing in this Section
shall be construed to constitute Administrative Agent’s or any Lender’s consent
to any transaction that is not permitted by other provisions of this Agreement
or the other Loan Documents.


 


(c) All such amounts pursuant to Section 2.12(b)(ii), (iii)
and (iv) shall be applied, first to prepay any Protective
Advances that may be outstanding, pro rata, and second to prepay the
Revolving Loans (including Swing Line Loans) without a corresponding reduction
in the Revolving Commitment.  If the
Borrower is required to make a mandatory prepayment of any Eurodollar Loans
under this Section 2.12 at a time when no Event of Default has occurred
and is continuing, the Borrower shall have the right, in lieu of making such
prepayment in full, to deposit an amount equal to such mandatory prepayment
with the Administrative Agent in a cash collateral account maintained (pursuant
to documentation reasonably satisfactory to the Administrative Agent) by the
Borrower with, and under the sole dominion and control of, the Administrative
Agent.  Any amounts so deposited shall be
held by the Administrative Agent as Collateral for such Eurodollar Loans and
shall be applied to the prepayment of the applicable Eurodollar Loans at the
earlier of the end of the current Interest Periods applicable thereto or, at
the Administrative Agent’s election, if an Event of Default is in
existence.  At the request of the
Borrower, amounts so deposited shall be invested by the Administrative Agent in
Permitted Investments maturing on or prior to the end of the current Interest
Periods applicable to such Eurodollar Loans; any interest earned on such
Permitted Investments will be for the account of the Borrower and the Borrower
will deposit with the Administrative Agent the amount of any loss on any such
Permitted Investments to the extent necessary in order that the amount of the
prepayment to be made with the deposited amounts may not be reduced.


 


(d) The Borrower shall notify the Administrative Agent (and, in
the case of prepayment of a Swingline Loan, the Swingline Lender) by telephone
(confirmed by facsimile) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Revolving Borrowing, not later than 10:00 a.m.,
Chicago time, three Business Days before the date of prepayment, (ii) in the
case of prepayment of an ABR Revolving Borrowing, not later than 10:00 a.m.,
Chicago time, one Business Day before the date of prepayment or (iii) in
the case of prepayment of a Swingline Loan, not later than 11:00 a.m., Chicago
time, on the date of prepayment.  Each
such notice shall be irrevocable and shall specify the prepayment date and the
principal amount of each Borrowing or portion thereof to be prepaid; provided
that, if a notice of prepayment is given in connection with a conditional
notice of termination of the Commitments as contemplated by Section 2.10,
then such notice of prepayment may be revoked if such notice of termination is
revoked in accordance with Section 2.10.  Promptly following receipt of any such notice
relating to a Revolving Borrowing, the Administrative Agent shall advise the
Lenders of the contents thereof.  Each
partial prepayment of any Revolving Borrowing shall be in an amount that would
be permitted in the case of an advance of a Revolving Borrowing of the same
Type as provided in Section 2.03. 
Each prepayment of a Revolving Borrowing shall be applied ratably to the
Revolving Loans included in the prepaid Borrowing.  Prepayments shall be


 


45





















 


made without premium or penalty (but subject
to payment of amounts payable pursuant to Section 2.17) and shall be
accompanied by accrued interest to the extent required by Section 2.14.


 


Section 2.13           Fees.  (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Revolving Lender a commitment fee,
which shall accrue at the Applicable Rate on the average daily amount of the
Available Revolving Commitment of such Revolving Lender during the period from
and including the Effective Date to but excluding the date on which such
Revolving Lenders’ Revolving Commitment terminates.  Accrued commitment fees shall be payable in
arrears on the last day of each calendar month and on the date on which the
Revolving Commitments terminate, commencing on the first such date to occur
after the date hereof.  All commitment
fees shall be computed on the basis of a year of 360 days and shall be payable
for the actual number of days elapsed (including the first day but excluding
the last day).


 


(b) The Borrower agrees to pay (i) to the Administrative Agent for
the account of each Revolving Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Rate used to determine the interest rate applicable to Eurodollar Loans on the
average daily amount of such Lender’s LC Exposure (excluding any portion
thereof attributable to unreimbursed LC Disbursements) during the period from
and including the Effective Date to but excluding the later of the date on
which such Lender’s Revolving Commitment terminates and the date on which such
Revolving Lender ceases to have any LC Exposure, and (ii) to the Issuing Banks
a fronting fee, which shall accrue at the rate of one-quarter of one percent
(0.25%) per annum on the average daily amount of the LC Exposure (excluding any
portion thereof attributable to unreimbursed LC Disbursements) during the
period from and including the Effective Date to but excluding the later of the
date of termination of the Revolving Commitments and the date on which there
ceases to be any LC Exposure, as well as each Issuing Bank’s standard fees with
respect to the issuance, amendment, renewal or extension of any Letter of
Credit or processing of drawings thereunder. 
Participation fees and fronting fees accrued through and including the
last day of each calendar month shall be payable on the third Business Day
following such last day, commencing on the first such date to occur after the
Effective Date; provided that all such fees shall be payable on the date
on which the Revolving Commitments terminate and any such fees accruing after
the date on which the Commitments terminate shall be payable on demand.  Any other fees payable to the Issuing Banks
pursuant to this paragraph shall be payable within ten (10) days after written
demand.  All participation fees and
fronting fees shall be computed on the basis of a year of 360 days and shall be
payable for the actual number of days elapsed (including the first day but
excluding the last day).


 


(c) The Borrower agrees to pay to the Administrative Agent, for
its own account, fees payable in the amounts and at the times separately agreed
upon between the Borrower and the Administrative Agent.


 


(d) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (or to an Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
commitment fees and participation fees, to the Lenders.  Fees paid shall not be refundable under any
circumstances.


 


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Section 2.14           Interest.  (a) The Loans comprising each
ABR Borrowing (including each Swingline Loan) shall bear interest at the
Alternate Base Rate plus the Applicable Rate.


 


(b) The Loans comprising each Eurodollar Borrowing shall bear
interest at the Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Rate.


 


(c) Each Protective Advance shall bear interest at the Alternate
Base Rate plus the Applicable Rate for ABR Loans plus 2%.


 


(d) Notwithstanding the foregoing, if any principal of or interest
on any Loan or any fee or other amount payable by the Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, 2% plus
the rate otherwise applicable to such Loan as provided in the preceding
paragraphs of this Section or (ii) in the case of any other amount, 2% plus the
rate applicable to ABR Loans as provided in paragraph (a) of this Section.


 


(e) Accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date for such Loan and upon termination of the
Commitments; provided that (i) interest accrued pursuant to paragraph
(d) of this Section shall be payable on demand, (ii) in the event of any
repayment or prepayment of any Loan (other than a prepayment of an ABR
Revolving Loan prior to the end of the Availability Period), accrued interest
on the principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.


 


(f) All interest hereunder shall be computed on the basis of a
year of 360 days, except that interest computed by reference to the Alternate
Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall
be computed on the basis of a year of 365 days (or 366 days in a leap year),
and in each case shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).  The applicable Alternate Base Rate, Adjusted
LIBO Rate or LIBO Rate shall be determined by the Administrative Agent, and
such determination shall be conclusive absent manifest error.


 


Section 2.15           Alternate
Rate of Interest.  If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:


 


(a) the Administrative Agent determines (which determination shall
be conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable,
for such Interest Period; or


 


(b) the Administrative Agent is advised by the Required Lenders
that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest
Period will not adequately and fairly reflect the cost to such Lenders (or
Lender) of making or maintaining their Loans (or its Loan) included in such
Borrowing for such Interest Period;


 


47





















 


then the Administrative Agent shall give notice thereof to the Borrower
and the Lenders by telephone or facsimile as promptly as practicable thereafter
and, until the Administrative Agent notifies the Borrower and the Lenders that
the circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Revolving Borrowing to, or
continuation of any Revolving Borrowing as, a Eurodollar Borrowing shall be
ineffective, and (ii) if any Borrowing Request requests a Eurodollar Borrowing,
such Borrowing shall be made as an ABR Borrowing.


 


Section 2.16           Increased
Costs.  (a) If any Change in Law
shall:


 


(i)            impose, modify or deem
applicable any reserve, special deposit or similar requirement against assets
of, deposits with or for the account of, or credit extended by, any Lender
(except any such reserve requirement reflected in the Adjusted LIBO Rate) or
any Issuing Bank; or


 


(ii)           impose on any Lender or
any Issuing Bank or the London interbank market any other condition affecting
this Agreement or Eurodollar 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 (by an
amount deemed by such Lender or Issuing Bank to be material) the cost (other
than with respect to Taxes, which shall be governed solely by Section 2.18)
to such Lender of making or maintaining any Eurodollar Loan (or of maintaining
its obligation to make any such Loan) or to increase (by an amount deemed by
such Lender or Issuing Bank to be material) the cost to such Lender or such
Issuing Bank of participating in, issuing or maintaining any Letter of Credit
or to reduce (by an amount deemed by such Lender or Issuing Bank to be
material) the amount of any sum received or receivable by such Lender or such
Issuing Bank hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or such Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or such Issuing
Bank, as the case may be, for such additional costs incurred or reduction
suffered.


 


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


 


(c) A certificate of a Lender or an Issuing Bank setting forth in
reasonable detail the basis for calculating the amount or amounts necessary to
compensate such Lender or such


 


48





















 


Issuing Bank or its holding company, as the
case may be, as specified in paragraph (a) or (b) of this Section shall be
delivered to the Borrower and shall be conclusive absent manifest error.  The Borrower shall pay such Lender or such
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within ten (10) Business Days after receipt thereof.


 


(d) Failure or delay on the part of any Lender or any Issuing Bank
to demand compensation pursuant to this Section shall not constitute a waiver
of such Lender’s or such Issuing Bank’s right to demand such compensation; provided
that the Borrower shall not be required to compensate a Lender or any Issuing
Bank pursuant to this Section for any increased costs or reductions incurred
more than 180 days prior to the date that such Lender or such Issuing Bank, as
the case may be, notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender’s or such Issuing Bank’s
intention to claim compensation therefor; provided  further that,
if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 180-day period referred to above shall be extended to
include the period of retroactive effect thereof.


 


Section 2.17           Break
Funding Payments.  In the event of
(a) the payment of any principal of any Eurodollar Loan other than on the last
day of an Interest Period applicable thereto (including as a result of an Event
of Default), (b) the conversion of any Eurodollar Loan other than on the last
day of the Interest Period applicable thereto, (c) the failure to borrow,
convert, continue or prepay any Eurodollar Loan on the date specified in any
notice delivered pursuant hereto (regardless of whether such notice may be
revoked under Section 2.10(d) and is revoked in accordance therewith),
or (d) the assignment of any Eurodollar Loan other than on the last day of
the Interest Period applicable thereto as a result of a request by the Borrower
pursuant to Section 2.20, then, in any such event, the Borrower
shall compensate each Lender for the loss, cost and expense (other than any
lost profit or margin) attributable to such event.  In the case of a Eurodollar Loan, such loss,
cost or expense to any Lender shall be deemed to be an amount reasonably
determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the Adjusted LIBO Rate (without, for the avoidance of
doubt, the addition of the Applicable Margin) that would have been applicable
to such Loan, for the period from the date of such event to the last day of the
then current Interest Period therefor (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the Interest Period
for such Loan), over (ii) the amount of interest which would accrue on such
principal amount for such period at the interest rate which such Lender would
bid were it to bid, at the commencement of such period, for dollar deposits of
a comparable amount and period from other banks in the Eurodollar market.  A certificate of any Lender setting forth in
reasonable detail the basis for calculating any amount or amounts that such
Lender is entitled to receive pursuant to this Section shall be delivered to
the Borrower and shall be conclusive absent manifest error.  The Borrower shall pay such Lender the amount
shown as due on any such certificate within ten (10) Business Days after
receipt thereof.  The Borrower shall not
be obligated to compensate a Lender pursuant to this Section for any amount
relating to any such event occurring more than 180 days prior to the date such
Lender notifies the Borrower of such Lender’s intention to claim compensation
therefore.


 


Section 2.18           Taxes.  (a) Except to the extent required by
applicable law, any and all payments by any Loan Party under this Agreement
shall be made free and clear of and without deduction for any Indemnified Taxes
or Other Taxes (including any interest, penalties or addition


 


49





















 


to tax); provided that
if any Loan Party shall be required to deduct any Indemnified Taxes or Other
Taxes from such payments by such Loan Party, then (i) the sum payable
shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, Lender or Issuing Bank (as the case may be) receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) such Loan Party shall make such deductions and (iii) such
Loan Party shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.


 


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


 


(c) Subject to Section 2.18(e), the Loan Parties shall
indemnify the Administrative Agent, each Lender and each Issuing Bank, within
ten (10) Business Days after written demand (which shall contain the
certificate described below) therefor, for the full amount of any Indemnified
Taxes or Other Taxes paid by the Administrative Agent, such Lender or such
Issuing Bank, as the case may be, on or with respect to any payment by or on
account of any Loan Party under this Agreement (including Indemnified Taxes or
Other Taxes imposed or asserted on or attributable to amounts payable under
this Section) 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, except to the extent the Indemnified Taxes or Other
Taxes were not correctly or legally imposed and the Lender or Issuing Bank, as
the case may be, had actual knowledge that such Indemnified Taxes or Other
Taxes were not correctly or legally imposed. 
A certificate setting forth in reasonable detail the basis for
calculating the amount of such payment or liability delivered to the Borrower
by a Lender or an Issuing Bank, or by the Administrative Agent on its own
behalf or on behalf of a Lender or an Issuing Bank, shall be conclusive absent
manifest error.


 


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


 


(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax (including backup withholding), with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law, such
properly completed and executed documentation prescribed by applicable law or
reasonably requested by the Borrower as will permit such payments to be made
without withholding or at a reduced rate.


 


(f) If the Administrative Agent or a Lender determines, in its
sole discretion, that it has received a refund (whether received in cash or
constructively received as a credit against another tax liability imposed by
the same taxing authority) of any Taxes or Other Taxes as to which it has been
indemnified by a Loan Party or with respect to which a Loan Party has paid
additional amounts pursuant to this Section 2.18, it shall pay over such
refund to such Loan Party


 


50





















 


(but only to the extent of indemnity payments
made, or additional amounts paid, by such Loan Party under this Section 2.18
with respect to the Taxes or Other Taxes giving rise to such refund), net of
all out-of-pocket expenses of the Administrative Agent or such Lender and any
Taxes paid with respect to such indemnity payments or other amounts and without
interest (other than any interest paid by the relevant Governmental Authority
with respect to such refund); provided, that such Loan Party, upon the request
of the Administrative Agent or such Lender, agrees to repay the amount paid
over to such Loan Party (plus any penalties, interest or other charges imposed
by the relevant Governmental Authority) to the Administrative Agent or such
Lender in the event the Administrative Agent or such Lender is required to
repay such refund to such Governmental Authority.  This Section shall not be construed to
require the Administrative Agent or any Lender to make available its tax
returns (or any other information relating to its taxes which it deems
confidential) to any Loan Party or any other Person.


 


Section 2.19           Payments
Generally; Allocation of Proceeds; Sharing of Set-offs.  (a) 
The Borrower shall make each payment required to be made by it hereunder
(whether of principal, interest, fees or reimbursement of LC Disbursements, or
of amounts payable under Section 2.16, 2.17 or 2.18, or
otherwise) prior to 11:00 a.m., Chicago time, on the date when due, in
immediately available funds, without set-off or counterclaim.  Any amounts received after such time on any date
may, in the discretion of the Administrative Agent, be deemed to have been
received on the next succeeding Business Day solely for purposes of calculating
interest thereon.  All such payments
shall be made to the Administrative Agent at its offices at 120 South LaSalle
Street, Chicago, Illinois, except payments to be made directly to an Issuing
Bank or the Swingline Lender as expressly provided herein.  The Administrative Agent shall distribute any
such payments received by it for the account of any other Person to the
appropriate recipient promptly following receipt thereof.  If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such
extension.  All payments hereunder shall
be made in dollars.  Solely for purposes
of determining the amount of Loans available for borrowing purposes, checks and
cash or other immediately available funds from collections of items of payment
and proceeds of any Collateral shall be applied in whole or in part against the
Obligations, on the day of receipt, subject to actual collection.


 


(b) Notwithstanding anything to the contrary in this Agreement,
any proceeds of Collateral received by the Administrative Agent (or any Secured
Party) when an Event of Default has occurred and is continuing and the
Administrative Agent so elects or the Required Lenders so direct, such funds
shall be applied ratably first, to pay any fees, indemnities, or expense
reimbursements including amounts then due and payable to the Administrative
Agent and the Issuing Banks from the Borrower (other than in connection with
Banking Services Obligations or Swap Obligations), second, to pay any
fees or expense reimbursements then due and payable to the Lenders from the
Borrower (other than in connection with Banking Services Obligations or Swap
Obligations), third, to pay interest due and payable in respect of the Protective
Advances, fourth, to pay the principal of the Protective Advances, fifth,
to pay interest then due and payable on the Loans (other than the Protective
Advances) ratably, sixth, to prepay principal on the Loans (other than
the Protective Advances) and unreimbursed LC Disbursements ratably, seventh,
to pay an amount to the Administrative Agent equal to one hundred five percent
(105%) of the aggregate undrawn face amount of all outstanding Letters of


 


51





















 


Credit and the aggregate amount of any unpaid
LC Disbursements, to be held as cash collateral for such Obligations, eighth,
to payment of any amounts due and payable by the Borrower to any Lender with
respect to Banking Services Obligations and Swap Obligations, and ninth,
to the payment of any other Obligation due and payable to the Administrative
Agent or any Lender by the Borrower.  Notwithstanding
anything to the contrary contained in this Agreement, unless so directed by the
Borrower, or unless an Event of Default is in existence, neither the
Administrative Agent nor any Lender shall apply any payment which it receives
to any Eurodollar Loan of a Class, except (a) on the expiration date of the
Interest Period applicable to any such Eurodollar Loan or (b) in the event, and
only to the extent, that there are no outstanding ABR Loans of the same Class
(and subject to Section 2.12(c)), and, in any event, the Borrower
shall pay the break funding payment required in accordance with Section 2.17.  The Administrative Agent and the Lenders
shall have the continuing and exclusive right to apply and reverse and reapply
any and all such proceeds and payments to any portion of the Obligations.


 


(c) At the election of the Administrative Agent during the
existence of an Event of Default or when cash dominion is in effect pursuant to
Section 7.1 of the Security Agreement, all payments of principal, interest, LC
Disbursements, fees, premiums, reimbursable expenses (including, without
limitation, all reimbursement for fees and expenses pursuant to Section 9.03),
and other sums payable under the Loan Documents, may be paid from the proceeds
of Borrowings made hereunder whether made following a request by the Borrower
pursuant to Section 2.04 or a deemed request as provided in this Section
or may be deducted from any deposit account of the Borrower maintained with the
Administrative Agent.  Borrower hereby
irrevocably authorizes (i) the Administrative Agent to make a Borrowing for the
purpose of paying each payment of principal, interest and fees as it becomes
due hereunder or any other amount due under the Loan Documents and agrees that
all such amounts charged shall constitute Loans (including Swingline Loans and
Protective Advances) and that all such Borrowings shall be deemed to have been
requested pursuant to Sections 2.04, 2.05 or 2.06, as
applicable and (ii) the Administrative Agent to charge any deposit account of
the Borrower maintained with the Administrative Agent for each payment of
principal, interest and fees as it becomes due hereunder or any other amount
due under the Loan Documents.


 


(d) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans or participations in LC Disbursements resulting in
such Lender receiving payment of a greater proportion of the aggregate amount
of its Loans and participations in LC Disbursements and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Loans and participations in LC Disbursements of other
Lenders to the extent necessary so that the benefit of all such payments shall
be shared by the Lenders ratably in accordance with the aggregate amount of
principal of and accrued interest on their respective Loans and participations
in LC Disbursements; provided that (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph
shall not be construed to apply to any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or participations in LC Disbursements to any
assignee or participant, other than


 


52





















 


to the Borrower or any Subsidiary or
Affiliate thereof (as to which the provisions of this paragraph shall
apply).  The Borrower consents to the
foregoing.


 


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


 


(f) If any Lender shall fail to make any payment required to be
made by it pursuant to Section 2.06, 2.07(d) or (e), 2.08(b),
2.19(e) or 9.03(c), then the Administrative Agent may, in its
discretion (notwithstanding any contrary provision hereof), apply any amounts
thereafter received by the Administrative Agent for the account of such Lender
to satisfy such Lender’s obligations under such Sections until all such
unsatisfied obligations are fully paid.


 


Section 2.20           Mitigation
Obligations; Replacement of Lenders. 
If any Lender requests compensation under Section 2.16, or
if the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.18,
then:


 


(a) such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices, branches
or affiliates, if, in the judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section
2.16 or 2.18, as the case may be, in the future and (ii) would not
subject such Lender to any unreimbursed cost or expense and would not otherwise
be disadvantageous to such Lender;


 


(b) the Borrower may, at its sole expense, require such Lender or
any Defaulting Lender (such Lender or Defaulting Lender herein, a “Departing
Lender”), upon notice to the Departing Lender and the Administrative Agent, to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in Section 9.04), all its interests, rights
and obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the prior
written consent of the Administrative Agent (and if a Revolving Commitment is
being assigned, each Issuing Bank), which consent shall not unreasonably be
withheld or delayed, (ii) the Departing Lender shall have received payment of
an amount equal to the outstanding principal of its Loans and participations in
LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder, from the assignee (to the extent
of such outstanding principal and accrued interest and fees) or the Borrower
(in the case of all other amounts) and (iii) in the case of any such


 


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assignment resulting from a claim for
compensation under Section 2.16 or payments required to be made
pursuant to Section 2.18, such assignment will result in a
reduction in such compensation or payments. 
A Departing Lender shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.


 


Section 2.21           Returned
Payments.  If after receipt of any
payment which is applied to the payment of all or any part of the Obligations,
the Administrative Agent or any Lender is for any reason compelled to surrender
such payment or proceeds to any Person because such payment or application of
proceeds is invalidated, declared fraudulent, set aside, determined to be void
or voidable as a preference, impermissible setoff, or a diversion of trust
funds, or for any other reason, then the Obligations or part thereof intended
to be satisfied shall be revived and continued and this Agreement shall
continue in full force as if such payment or proceeds had not been received by
the Administrative Agent or such Lender and the Borrower shall be liable to pay
to the Administrative Agent and the Lenders the amount of such payment or
proceeds surrendered.  The provisions of
this Section 2.21 shall be and remain effective notwithstanding any
contrary action which may have been taken by the Administrative Agent or any
Lender in reliance upon such payment or application of proceeds, and any such
contrary action so taken shall be without prejudice to the Administrative Agent’s
and the Lenders’ rights under this Agreement and shall be deemed to have been
conditioned upon such payment or application of proceeds having become final
and irrevocable.  The provisions of this Section
2.21 shall survive the termination of this Agreement.


 


ARTICLE
III.


 


REPRESENTATIONS AND WARRANTIES


 


Each Loan Party represents and warrants to the Lenders that:


 


Section 3.01           Organization;
Powers.  Each of the Loan Parties and
each of its Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, has all
requisite power and authority to carry on its business as now conducted and is
qualified to do business in, and is in good standing in, every jurisdiction
where such qualification is required, except where failure to be so qualified
and in good standing, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.


 


Section 3.02           Authorization;
Enforceability.  The Transactions are
within each Loan Party’s corporate, company, or other organizational powers and
have been duly authorized by all necessary corporate, company, or other
organizational powers and, if required, stockholder action.  This Agreement has been, and each other Loan
Agreement when delivered hereunder, will be duly executed and delivered by each
Loan Party party thereto. This Agreement constitutes, and each other Loan
Document when delivered hereunder will constitute, a legal, valid and binding
obligation of each Loan Party party thereto, enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, fraudulent transfer, reorganization,


 


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moratorium or other laws
affecting creditors’ rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.


 


Section 3.03           Governmental
Approvals; No Conflicts.  The
Transactions (a) do not require any consent or approval of, registration or
filing with, or any other action by, any Governmental Authority, except such as
have been obtained or made and are in full force and effect or waived, actions
and filings necessary to create or perfect Liens in the Collateral and those
the failure of which to make or obtain could not reasonably be expected to have
a Material Adverse Effect, (b) will not violate any applicable law or regulation
or the charter, by-laws or other organizational documents of any Loan Party or
any of its Subsidiaries or any order of any Governmental Authority, except as
could not reasonably be expected to have a Material Adverse Effect, (c) will
not violate or result in a default under any indenture, agreement or other
instrument binding upon any Loan Party or any of its Subsidiaries or its
assets, or give rise to a right thereunder to require any payment to be made by
any Loan Party or any of its Subsidiaries, except as could not reasonably be
expected to have a Material Adverse Effect, and (d) will not result in the
creation or imposition of any Lien on any asset of any Loan Party (other than
any Lien created under the Loan Documents) or any of its Subsidiaries.


 


Section 3.04           Financial
Condition; No Material Adverse Change. 
(a) The Borrower has heretofore furnished to the Lenders copies (which
copies are attached as Exhibit G hereto) of its consolidated balance sheet
and statements of income, stockholders equity and cash flows (i) as of and for
the fiscal years ended December 31, 2003 and December 31, 2004, reported
on by KPMG LLP, independent public accountants, and (ii) as of and for the
fiscal quarter ended March 31, 2005 and for each month and the portion of the
fiscal year ended May 31, 2005, certified by its chief financial officer.  Such financial statements present fairly, in
all material respects, the consolidated financial position and consolidated
results of operations and cash flows of the Borrower and its consolidated
Subsidiaries as of such dates and for such periods in accordance with GAAP,
subject to year-end audit adjustments and the absence of footnotes in the case
of the statements referred to in clause (ii) above.


 


(b) Since December 31, 2004, there has been no change in the
business, assets, operations or financial condition of the Loan Parties and
their Subsidiaries, taken as a whole, which could reasonably be expected to
have a Material Adverse Effect.


 


Section 3.05           Properties.  (a) As of the date of this Agreement, Schedule
3.05(a) sets forth a correct and complete list of all real property owned
or leased by each Loan Party.  Except as
could not reasonably be expected to have a Material Adverse Effect, each of
such leases and subleases is valid and enforceable in accordance with its terms
and is in full force and effect, and, to the knowledge of the Borrower and the
other Loan Parties, no default by any party to any such lease or sublease
exists.  Except as set forth on Schedule
3.05, each of the Loan Parties has good title to, or valid leasehold
interests in (or otherwise has the right to use), all its real and personal
property necessary to the conduct of its business, free of all Liens other than
those permitted by Section 6.02.


 


(b) Except as could not reasonably be expected to have a Material
Adverse Effect, each Loan Party and its Subsidiaries owns, or is licensed to
use, all trademarks, tradenames, copyrights, patents and other intellectual
property necessary to the current conduct of the Loan


 


55





















 


Parties’ business, and the use thereof by the
Loan Parties and its Subsidiaries does not infringe in any material respect
upon the rights of any other Person.


 


Section 3.06           Litigation
and Environmental Matters.  (a)  There are no actions, suits or proceedings by
or before any arbitrator or Governmental Authority pending against or, to the
knowledge of any Loan Party, threatened against the Loan Parties or any of
their Subsidiaries (i) as to which there is a reasonable possibility of an
adverse determination and that could reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect (other than the Disclosed
Matters) or (ii) that in any material respect draws into question the validity
or enforceability of this Agreement or the Transactions.


 


(b) Except for any matters that, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect and other
than the Disclosed Matters, (i) no Loan Party nor any of its Subsidiaries has
received written notice of any claim with respect to any Environmental
Liability or knows of any basis for any such Environmental Liability, and (ii)
no Loan Party nor any of its Subsidiaries (1) has failed to comply with
any Environmental Law or to obtain, maintain or comply with any permit, license
or other approval required under any Environmental Law or (2) to the
knowledge of a Responsible Officer of such Person, has become subject to any
Environmental Liability.


 


Section 3.07           Compliance
with Laws and Agreements.  Each of
the Loan Parties and its Subsidiaries is in compliance in all material respects
with all laws, regulations and orders of any Governmental Authority applicable
to it or its property, and all indentures, agreements and other instruments
binding upon it or its property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.  No Default has
occurred and is continuing.


 


Section 3.08           Investment
and Holding Company Status.  Neither
the Parent nor any of its Subsidiaries is (a) an “investment company” or a
company “controlled” by an “investment company” as defined in the Investment
Company Act of 1940 or (b) a “holding company” as defined in the Public
Utility Holding Company Act of 1935.


 


Section 3.09           Taxes.  Each of the Parent and its Subsidiaries has
timely filed or caused to be filed all federal income and other material Tax
returns required to have been filed and has paid or caused to be paid all
federal income and other material Taxes required to have been paid by it,
except Taxes that are being contested in good faith by appropriate proceedings
and for which the Parent or such Subsidiary, as applicable, has set aside on
its books adequate reserves.  No tax
liens have been filed, except for liens for Taxes not yet due and payable or
that are being contested in accordance with Section 5.04, and no claims
are being asserted with respect to any material amount of such taxes, except
claims being contested in accordance with Section 5.04.


 


Section 3.10           ERISA.  No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events
for which liability is reasonably expected to occur, could reasonably be
expected to either (a) have a Material Adverse Effect or (b) result in the
occurrence of a lien or other granting of security interest (in each case other
than as permitted by this Agreement) against the property or assets of the
Borrower or such ERISA Affiliate.


 


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Section 3.11           Disclosure.  To the Borrower’s knowledge, neither the
Information Memorandum nor any of the other reports, financial statements,
certificates or other information furnished in writing by or on behalf of the
Borrower to the Administrative Agent or any Lender in connection with the
negotiation of this Agreement or delivered hereunder (as modified or
supplemented by other information so furnished) contained, as of the date
furnished, any untrue statement of a material fact or omitted to state any
material fact necessary to make the statements therein, taken as a whole, not
materially misleading in the light of the circumstances under which they were
made; provided that, with respect to the Projections and other projected
and forward-looking information, the Borrower represents only that such
information was prepared in good faith based upon assumptions believed to be
reasonable at the time made (it being understood that no assurance has been
given or will be given that the Projections and other projections and
forward-looking information have been or will be achieved).


 


Section 3.12           Material
Agreements.  All material agreements
to which any Loan Party is a party or is bound as of the date of this Agreement
are listed on Schedule 3.12. 
Except as could not reasonably be expected to have a Material Adverse
Effect, no Loan Party is in default under the terms of any material agreement
to which it is a party.


 


Section 3.13           Solvency.  Immediately after the consummation of the transactions
to occur on the date hereof and immediately following the making of each
Borrowing and the issuance of each Letter of Credit, if any, made on the date
hereof and after giving effect to the application of the proceeds of such
Borrowing or such issuance of a Letter of Credit, the Parent and its
Subsidiaries on a consolidated basis: 
(a) own assets the fair saleable value of which are (i) greater than the
total amount of their liabilities (including contingent liabilities) as they
become absolute and mature and (ii) greater than the amount that will be
required to pay their existing debts as they become absolute and matured
considering all financing alternatives and potential asset sales reasonably
available to them, (b) have capital that is not unreasonably small in relation
to their business as presently conducted and (c) do not intend to incur and do
not believe they will incur debts beyond their ability to pay such debts as
they become due.


 


Section 3.14           Reportable
Transaction.  The Borrower does not
intend to treat the Borrowings or issuances of 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 Borrower determines to take any action inconsistent
with such intention, it will promptly notify the Administrative Agent thereof.


 


Section 3.15           Capitalization
and Subsidiaries.  Schedule 3.15
sets forth as of the Effective Date (a) a correct and complete list of the name
and relationship to each Loan Party of each and all of such Loan Party’s
Subsidiaries, (b) a true and complete listing of each class of each Loan Party’s
authorized Equity Interests, of which all of such issued shares are (to the
extent such concepts are relevant with respect to such ownership interest)
validly issued, outstanding, fully paid and non-assessable, and (except in the
case of the Parent) owned beneficially and of record by the Persons identified
on Schedule 3.15, and (c) the type of entity of each Loan Party and each
of its Subsidiaries.  All of the issued
and outstanding Equity Interests owned by any Loan Party has been (to the
extent such concepts are relevant with respect to such ownership interests)
duly authorized and issued and is fully paid and non-assessable.


 


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Section 3.16           Common
Enterprise.  The Loan Parties are
part of an affiliated group.  Each Loan
Party expects to derive benefit, directly and indirectly, from (i) successful
operations of each of the other Loan Parties and (ii) the credit extended by
the Lenders to the Borrower hereunder, both in their separate capacities and as
members of the group of companies.


 


Section 3.17           Labor
Disputes.  Except as set forth on Schedule
3.17, as of the date of this Agreement (a) there is no collective
bargaining agreement or other labor contract covering employees of any Loan
Party or any of its Subsidiaries, (b) no such collective bargaining agreement
or other labor contract is scheduled to expire during the term of this Agreement,
(c) no Responsible Officer of any Loan Party has knowledge that any union or
other labor organization is seeking to organize, or to be recognized as, a
collective bargaining unit of employees of such Loan Party or any of its
Subsidiaries or for any similar purpose, and (d) except as could not
reasonably be expected to have a Material Adverse Effect, there is no pending
or (to the best of the Borrower’s knowledge) threatened, strike, work stoppage,
material unfair labor practice claim, or other material labor dispute against
or affecting any Loan Party or its Subsidiaries or their employees.


 


ARTICLE
IV.


 


CONDITIONS


 


Section 4.01           Effective
Date.  The obligations of the Lenders
to make Loans and of the Issuing Bank to issue Letters of Credit hereunder
shall not become effective until the date on which each of the following
conditions is satisfied (or waived in accordance with Section 9.02):


 


(a) The Administrative Agent (or its counsel) shall have received
from each party hereto either (i) a counterpart of this Agreement signed
on behalf of such party or (ii) written evidence satisfactory to the
Administrative Agent (which may include facsimile transmission of a signed
signature page of this Agreement) that such party has signed a counterpart of
this Agreement.


 


(b) The Administrative Agent shall have received duly executed
copies of the Loan Documents and such other certificates, documents,
instruments and agreements as the Administrative Agent shall reasonably request
in connection with the transactions contemplated by this Agreement and the
other Loan Documents and which are listed in the Closing Checklist, each in
form and substance reasonably satisfactory to Administrative Agent.


 


(c) The Loan Parties’ corporate structure, capital structure,
material accounts and governing documents shall be reasonably acceptable to the
Administrative Agent.


 


(d) All legal (including tax implications) and regulatory matters,
including, but not limited to compliance with applicable requirements of
Regulations U, T and X of the Board, shall be reasonably satisfactory to the
Administrative Agent.


 


(e) After giving effect to all Borrowings to be made on the
Effective Date and the issuance of any Letters of Credit on the Effective Date
and payment of all fees and expenses due hereunder, and with all of the Loan
Parties’ indebtedness, liabilities, and obligations current, the Borrower’s
Availability (plus up to
$20,000,000 of unrestricted cash and Permitted Investments


 


58





















 


held in deposit accounts or investment
accounts with the Administrative Agent) shall not be less than $100,000,000.


 


(f) The Administrative Agent shall have received all fees and
other amounts due and payable on or prior to the Effective Date, including, to
the extent invoiced, reimbursement or payment of all reasonable out-of-pocket
expenses, required to be reimbursed or paid by the Borrower hereunder.


 


(g) The Borrower shall have delivered to the Administrative Agent
a notice setting forth the deposit account of the Borrower (the “Funding
Account”) to which the Administrative Agent is authorized by the Borrower
to transfer the proceeds of any Borrowings requested or authorized pursuant to
this Agreement.


 


(h) The Parent shall have consummated the IPO and the Reorganization
Transaction, upon terms and conditions substantially similar to those described
in the Registration Statement and otherwise reasonably satisfactory to the
Administrative Agent.


 


(i) The Note Agreement Amendments shall have become effective and
the Borrower shall have deposited monies under the Noteholders Depository
Agreement in an amount sufficient to repay in full the Noteholders Obligations
(other than any contingent obligations that expressly survive the termination
of the Noteholders Documents as to which no material claims giving rise thereto
have then been asserted), and all Liens granted pursuant to the Noteholders
Documents (other than any Liens permitted by Section 6.02(g)) upon any
property of the Loan Parties shall have been released, upon terms and
conditions reasonably satisfactory to the Administrative Agent.


 


(j) The Borrower shall have repaid in full all outstanding
Indebtedness under its existing revolving credit facility, and the agent
holding Liens on behalf of the lenders thereunder shall have released all Liens
granted pursuant to such credit facility upon any property of the Loan Parties,
upon terms and conditions reasonably satisfactory to the Administrative Agent..


 


(k) The Administrative Agent shall have received and be reasonably
satisfied with (i) the financial statements referred to in Section 3.04
and (ii) the Parent’s most recent projected income statement, balance sheet and
cash flows for the period beginning January 1, 2005 and ending December 31,
2010 (prepared on a monthly basis for the 2005 fiscal year, on a quarterly
basis for the 2006 fiscal year and on an annual basis thereafter).


 


(l) The Administrative Agent shall have received and the
Administrative Agent shall be reasonably satisfied with appraisals of Inventory
and the Eligible Donaldsonville Fixed Assets from appraisers reasonably
satisfactory to the Administrative Agent (following consultation with the
Borrower).


 


(m) The Administrative Agent shall have received and be reasonably
satisfied with any reasonably requested environmental review reports with
respect to the Donaldsonville Real Estate from firm(s) reasonably satisfactory
to the Administrative Agent (following consultation with the Borrower).


 


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The Administrative Agent shall notify the Borrower and the Lenders of
the Effective Date, and such notice shall be conclusive and binding.  Notwithstanding the foregoing, the
obligations of the Lenders to make Loans and of the Issuing Banks to issue
Letters of Credit hereunder shall not become effective unless each of the
foregoing conditions is satisfied (or waived pursuant to Section 9.02)
at or prior to 2:00 p.m., Chicago time, on September 30, 2005 (and, in the
event such conditions are not so satisfied or waived, the Commitments shall
terminate at such time).


 


Section 4.02           Each
Credit Event.  The obligation of each
Lender to make a Loan on the occasion of any Borrowing, and of any Issuing Bank
to issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:


 


(a) The representations and warranties of the Borrower set forth
in this Agreement shall be true and correct in all material respects on and as
of the date of such Borrowing or the date of issuance, amendment, renewal or
extension of such Letter of Credit, as applicable (except, in each case, to the
extent that such representations and warranties expressly relate to an earlier
date, in which case such representations and warranties shall be true and correct
in all material respects as of such earlier date), and if they are not true and
correct the Administrative Agent or the Required Lenders shall have determined
not to make any make a Loan or instructed the Issuing Banks not to issue
Letters of Credit as a result of the fact that such representation or warranty
is untrue or incorrect.


 


(b) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such Letter of
Credit, as applicable, no Default shall have occurred and be continuing and the
Administrative Agent or the Required Lenders shall have determined not to make
such Borrowing or instructed the Issuing Banks not to issue such Letter of
Credit as a result of such Default.


 


(c) After giving effect to any Borrowing or the issuance,
amendment, renewal or extension of any Letter of Credit, as applicable,
Availability is not less than zero.


 


Each Borrowing and each issuance, amendment, renewal or extension of a
Letter of Credit shall be deemed to constitute a representation and warranty by
the Borrower on the date thereof as to the matters specified in paragraphs (a),
(b) and (c) of this Section 4.02.


 


ARTICLE V.


 


AFFIRMATIVE COVENANTS


 


Until the Commitments have expired or been terminated and the principal
of and interest on each Loan and all fees payable hereunder shall have been
paid in full and all Letters of Credit shall have expired or terminated or been
secured in accordance with Section 2.07(j)(ii) and all LC Disbursements
shall have been reimbursed, each Loan Party executing this Agreement covenants
and agrees, jointly and severally with all of the Loan Parties, with the
Lenders that:


 


Section 5.01           Financial
Statements; Borrowing Base and Other Information.  The Borrower will furnish to the
Administrative Agent (for delivery to each Lender, provided that


 


60





















 


items delivered pursuant to
clause (j) below will be made available to the Administrative Agent as
specified in such clause):


 


(a) as soon as required under the Exchange Act but in any event
within ninety (90) days after the end of each fiscal year of the Parent, its
audited consolidated balance sheet and related statements of operations,
stockholders’ equity and cash flows as of the end of and for such fiscal year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all reported on by independent public accountants of recognized
national standing (without a “going
concern” or like qualification or exception and without any qualification or
exception as to the scope of such audit) to the effect that such consolidated
financial statements present fairly in all material respects the financial
condition and results of operations of the Parent and its consolidated
Subsidiaries on a consolidated basis in accordance with GAAP, accompanied by
any management letter prepared by said accountants, and its unaudited
consolidating balance sheet and related statement of operations for such fiscal
year;


 


(b) as soon as required under the Exchange Act but in any event
within forty-five (45) days after the end of each of the first three fiscal
quarters of each fiscal year of the Parent, its consolidated balance sheet and
related statements of operations, stockholders’ equity and cash flows as of the
end of and for such fiscal quarter and the then-elapsed portion of the fiscal
year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet, as of
the end of) the previous fiscal year, and its consolidating balance sheet and
related statement of operations for such period, all certified by one of the
Parent’s Financial Officers as presenting fairly in all material respects as of
the date of each such financial statement the financial condition and results
of operations of the Parent and its consolidated Subsidiaries on a consolidated
basis in accordance with GAAP, subject to normal year-end audit adjustments and
the absence of footnotes;


 


(c) within thirty (30) days after the end of each fiscal month of
the Parent (if the average daily Cash Availability Amount for such month or any
preceding month is less than $100,000,000 and until such time thereafter as the
average daily Cash Availability Amount for three consecutive fiscal months is
greater than or equal to $100,000,000), its consolidated balance sheet and
related statement of operations, stockholders’ equity and cash flows as of the
end of and for such fiscal month and the then-elapsed portion of the fiscal
year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet, as of
the end of) the previous fiscal year, and its consolidating balance sheet and
related statement of operations for such period, all certified by one of the
Parent’s Financial Officers as presenting fairly in all material respects as of
the date of each such statement the financial condition and results of
operations of the Parent and its consolidated Subsidiaries on a consolidated
basis in accordance with GAAP, subject to normal year-end audit adjustments and
the absence of footnotes; provided, however, that such financial statements for
the months of January and February of each fiscal year will be delivered on the
later of (i) 30 days after the last day of such month and (ii) the date of
delivery of the annual audited financial statements of the Parent for the
immediately preceding fiscal year in accordance with clause (a) above;


 


(d) concurrently with any delivery of financial statements under
clause (a) or (b) or (c) above, a certificate of a Financial Officer
of the Borrower in substantially the form of


 


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Exhibit E (i) certifying, in the case of
the financial statements delivered under clause (b) or (c), as presenting
fairly in all material respects as of the date of each such statement the
financial condition and results of operations of the Parent and its
consolidated Subsidiaries on a consolidated basis in accordance with GAAP,
subject to normal year-end audit adjustments and the absence of footnotes, (ii)
certifying as to whether a Default has occurred and, if a Default has occurred,
specifying the details thereof and any action taken or proposed to be taken
with respect thereto, (iii) setting forth reasonably detailed calculations
of average daily Availability for the most recent one-month, three-month and
six-month periods and demonstrating compliance with Section 6.12 (if
then applicable) and (iv) stating whether any material change in GAAP or
in the application thereof has occurred since the date of the audited financial
statements referred to in Section 3.04 and, if any such change has
occurred, specifying the effect of such change on the financial statements
accompanying such certificate;


 


(e) concurrently with any delivery of financial statements under
clause (a) above, a certificate or other written statement of the
accounting firm that reported on such financial statements stating whether they
obtained knowledge during the course of their examination of such financial
statements of any Default (which certificate may be limited to the extent
required by accounting rules or guidelines);


 


(f) as soon as available, but in any event not more than ninety
(90) days after the end of each fiscal year of the Parent, a copy of the plan
and forecast (including a projected consolidated balance sheet, income
statement and cash flow statement) of the Parent and its Subsidiaries for each
month of such fiscal year (the “Projections”), together with a summary
of assumptions underlying such forecast, in form reasonably satisfactory to the
Administrative Agent;


 


(g) as soon as available but in any event within fifteen (15)
Business Days after the end of each calendar month (or, if the Cash
Availability Amount is less than $50,000,000, within five (5) Business Days
after the end of each calendar week), and at such other times as may be
reasonably requested by the Administrative Agent following the occurrence and
during the continuance of an Event of Default, as of the period then ended, a
Borrowing Base Certificate and supporting information in connection therewith,
together with any additional reports with respect to the Borrowing Base as the
Administrative Agent may reasonably request; and the PP&E Component of the
Borrowing Base shall be updated (i) from time to time upon receipt of periodic
valuation updates received from the Administrative Agent’s asset valuation
experts, (ii) concurrent with the sale of any assets constituting part of the
PP&E Component, or (iii) upon notice from the Administrative Agent, in the
event that the value of such assets is materially impaired, as determined in
the Administrative Agent’s Permitted Discretion;


 


(h) as soon as available but in any event within fifteen (15)
Business Days of the end of each calendar month and at such other times as may
be reasonably requested by the Administrative Agent, as of the period then
ended, all delivered electronically in a text formatted file (not in an
Adobe *.pdf file):


 


(i)            a summary aging of the
Borrower’s Accounts, reconciled to the Borrowing Base Certificate delivered as
of such date prepared in a manner reasonably acceptable


 


62





















 


to the Administrative Agent, together with a
summary specifying the name, account number, and balance due for each Account
Debtor;


 


(ii)           a schedule detailing
the Borrower’s Inventory, in form satisfactory to the Administrative Agent, (1)
by location (showing Inventory in transit, any Inventory located with a third
party under any consignment, bailee arrangement, or warehouse agreement), by
product type, and by volume on hand, which Inventory shall be valued at the
lower of cost (determined on a first-in, first-out basis) or market and
adjusted for Reserves as the Administrative Agent has previously indicated to
the Borrower are deemed by the Administrative Agent to be appropriate, (2)
including a report of any Inventory adjustments in excess of $5,000,000 since
the last Inventory schedule, and (3) reconciled to the Borrowing Base
Certificate delivered as of such date;


 


(iii)          a worksheet of
calculations prepared by the Borrower to determine Eligible Accounts and
Eligible Inventory, such worksheets detailing the Accounts and Inventory
excluded from Eligible Accounts and Eligible Inventory and the ineligibility
criteria serving as the basis for such exclusion;


 


(iv)          a reconciliation of the
Borrower’s Accounts and Inventory between the amounts shown in the Borrower’s
general ledger and financial statements and the reports delivered pursuant to
clauses (i) and (ii) above; and


 


(v)           a reconciliation of the
loan balance per the Borrower’s general ledger to the loan balance under this
Agreement;


 


(i) as soon as available but in any event within fifteen (15)
Business Days of the end of each calendar month and at such other times as may
be reasonably requested by the Administrative Agent, as of the month then
ended, a schedule and aging of the Borrower’s accounts payable, delivered electronically
in a text formatted file (not in an Adobe *.pdf file);


 


(j) promptly upon the Administrative Agent’s request, which items
will be furnished to the Administrative Agent in the Borrower’s office during
normal business hours:


 


(i)            copies of invoices in
connection with the invoices issued by the Borrower in connection with any
Accounts, credit memos, shipping and delivery documents, and other information
related thereto;


 


(ii)           copies of purchase
orders, invoices, and shipping and delivery documents in connection with any
Inventory or Equipment purchased by any Loan Party; and


 


(iii)          the Borrower’s sales
detail, cash receipts detail (identifying trade and non-trade cash receipts)
and debit memo/credit memo detail;


 


(iv)          copies of those portions
of all tax returns filed by any Loan Party with the U.S. Internal Revenue
Service which set forth the names of all entities included within such filing;


 


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(v)           a certificate of good
standing for each Loan Party from the appropriate governmental officer in its
jurisdiction of incorporation, formation, or organization;


 


(k) not later than October 31 of each year, an updated customer
list for the Borrower and its Subsidiaries, which list shall state the customer’s
name, mailing address and phone number and shall be certified as true and
correct by an Financial Officer of the Borrower;


 


(l) promptly after the same become publicly available, copies of
all periodic and other reports, proxy statements and other materials filed by
the Borrower or any Subsidiary with the Securities and Exchange Commission, or
any Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, or distributed by the
Parent to its public securities holders generally, as the case may be; and


 


(m) promptly following any request therefor, such other
information regarding the operations, business affairs and financial condition
of any Loan Party or any Subsidiary, or compliance with the terms of this
Agreement, as the Administrative Agent may reasonably request.


 


Section 5.02           Notices
of Material Events.  The Borrower
will furnish to the Administrative Agent and each Lender prompt written notice
of the following:


 


(a) the occurrence of any Default;


 


(b) the written assertion of which a Responsible Officer of the
Borrower has knowledge by the holder of any Equity Interests of any Loan Party
or the holder of any Indebtedness of any Loan Party in excess of $10,000,000
that any default exists with respect thereto or that any Loan Party is not in
compliance therewith;


 


(c) receipt of any written notice of which a Responsible Officer
of the Borrower has knowledge of any governmental investigation or any
litigation commenced or threatened against any Loan Party that (i) seeks
damages which could reasonably be expected to exceed $10,000,000, (ii) seeks
injunctive relief that, if granted, could reasonably be expected to have a
Material Adverse Effect, (iii) is asserted or instituted against any Plan, its
fiduciaries or its assets, which assertion could reasonably be expected to
result in damages, costs or liabilities of any Loan Party or Subsidiary in
excess of $10,000,000, (iv) alleges criminal misconduct by any Loan Party or
Subsidiary that, if resulting in a conviction, could reasonably be expected to
have a Material Adverse Effect, (v) alleges the violation of any law regarding,
or seeks remedies in connection with, any Environmental Laws, which resolution
or remedy asserts or could result in damages, costs or liabilities of any Loan
Party or Subsidiary in excess of $10,000,000; or (vi) involves any product
recall to the extent such product recall could reasonably be expected to have a
Material Adverse Effect;


 


(d) commencement of any proceedings contesting any tax, fee,
assessment, or other governmental charge in excess of $10,000,000;


 


(e) the opening of any new deposit account by any Loan Party with
any bank or other financial institution;


 


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(f) any loss, damage, or destruction to the Collateral in the
amount of $5,000,000 or more, whether or not covered by insurance;


 


(g) any and all default notices received under or with respect to
any leased location or public warehouse where Collateral having a value in
excess of $5,000,000 in the aggregate for all such locations is located (which
shall be delivered within two (2) Business Days after receipt thereof by a
Responsible Officer of the Borrower), which default notices could reasonably be
expected to have a Material Adverse Effect on the value of such Collateral or
the interest therein of the Administrative Agent on behalf of the Secured
Parties;


 


(h) all material amendments to material real estate leases where
Collateral having a value in excess of $10,000,000 in the aggregate for all
such locations is located, together with a copy of each such amendment;


 


(i) immediately after any Responsible Officer of the Borrower
becoming aware of any pending or threatened strike, work stoppage, unfair labor
practice claim, or other labor dispute affecting the Borrower or any of its
Subsidiaries in a manner which could reasonably be expected to have a Material
Adverse Effect;


 


(j) the occurrence of any ERISA Event that, alone or together with
any other ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrower and its Subsidiaries in an aggregate amount
exceeding $10,000,000; and


 


(k) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.


 


Each notice delivered under this Section shall be accompanied by a
statement of a Financial Officer or other executive officer of the Borrower
setting forth the details of the event or development requiring such notice and
any action taken or proposed to be taken with respect thereto.


 


Section 5.03           Existence;
Conduct of Business.  Each Loan Party
will, and will cause each of its Subsidiaries to, do or cause to be done all
things necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business, and maintain all requisite authority to conduct
its business in each jurisdiction in which its business is conducted, in each case
except where the failure to do so could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect; provided that the foregoing
shall not prohibit any merger, consolidation, liquidation, dissolution or other
transaction permitted under Section 6.03; provided, further,
that nothing in this Section 5.03 shall prevent any Loan Party from
discontinuing the corporate existence of any Subsidiary if discontinuance is
desirable in the conduct of such Loan Party’s business or the business of such
Subsidiary and such discontinuance is not disadvantageous in any material
respect to the Lenders.


 


Section 5.04           Payment
of Obligations.  Each Loan Party
will, and will cause each of its Subsidiaries to, pay or discharge when due all
material Indebtedness and all other material liabilities and obligations,
including Taxes, except where (a) the validity or amount thereof is being
contested in good faith by appropriate proceedings, (b) such Loan Party or such
Subsidiary


 


65





















 


has set aside on its books
adequate reserves with respect thereto to the extent required in accordance
with GAAP and (c) the failure to make payment pending such contest could
not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.


 


Section 5.05           Maintenance
of Properties and Intellectual Property Rights.  Except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect, each Loan Party will,
and will cause each of its Subsidiaries to, (a) keep and maintain all
property material to the conduct of its business in good working order and
condition, ordinary wear and tear excepted, and (b) obtain and maintain in
effect at all times all material franchises, governmental authorizations,
intellectual property rights, licenses and permits, which are necessary for it
to own its property or conduct its business.


 


Section 5.06           Books
and Records; Inspection Rights.  Each
Loan Party will, and will cause each of its Subsidiaries to, keep proper books
of record and account in which entries which are full, true and correct in all
material respects are made of all material dealings and transactions in
relation to its business and activities. 
Each Loan Party will, and will cause each of its Subsidiaries to, permit
any representatives designated by the Administrative Agent or any Lender (so
long as such Lender or its representatives are accompanying the Administrative
Agent) (including employees of the Administrative Agent, any Lender, or any
consultants, accountants, lawyers and appraisers retained by the Administrative
Agent), upon reasonable prior notice, to visit and inspect its properties, to
examine and make extracts from its books and records, and to discuss its
affairs, finances and condition with its officers and independent accountants
(provided a representative from the Borrower shall have the right to be
present), all at such reasonable times during normal business hours and as
often as reasonably requested; provided, that following the Effective
Date and so long as no Event of Default has occurred and is continuing, the
Borrower shall only be required to reimburse the Administrative Agent in
accordance with Section 9.03 for the cost of (i) one such inspection in
any fiscal year, and (ii) one additional such inspection in any fiscal year in
the event that the average daily Cash Availability Amount is less than
$100,000,000 for any calendar month during such fiscal year.  After the occurrence and during the
continuance of any Event of Default, each Loan Party shall provide the
Administrative Agent with access to its suppliers. The Loan Parties acknowledge
that the Administrative Agent, after exercising its rights of inspection, may
prepare and distribute to the Lenders certain Reports pertaining to the Loan
Parties’ assets for internal use by the Administrative Agent and the Lenders.


 


Section 5.07           Compliance
with Laws.  Each Loan Party will, and
will cause each of its Subsidiaries to, comply with all laws, rules,
regulations and orders of any Governmental Authority applicable to it or its
property, except where the failure to do so, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.


 


Section 5.08           Use
of Proceeds and Letters of Credit. 
The proceeds of the Loans will be used only for working capital and
general corporate purposes of the Loan Parties and their Subsidiaries not in
contravention of the Credit Agreement. 
No part of the proceeds of any Loan will be used, whether directly or
indirectly, for any purpose that entails a violation of any of the Regulations
of the Board, including Regulations T, U and X. 
Letters of Credit will be issued only to support the working capital
needs and other general corporate purposes of the Loan Parties and their
Subsidiaries not in contravention of the Credit Agreement.


 


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Section 5.09           Insurance.  (a) Each Loan Party will, and will cause each
of its Subsidiaries to, maintain with financially sound and reputable carriers
having a financial strength rating of at least A by A.M. Best Company (or the
equivalent rating with respect to markets not rated by A.M. Best Company) or
otherwise acceptable to the Administrative Agent in its Permitted Discretion
insurance against: (i) loss or damage by fire and loss in transit; (ii) theft,
burglary, pilferage, larceny, embezzlement, and other criminal activities;
(iii) business interruption; (iv) general liability and (v) and such other
hazards, as is customary in the business of such Person; provided that
the Loan Parties and the Subsidiaries may self-insure in accordance with good
business practice.  Without limiting the
generality of the foregoing, the Borrower shall maintain, with respect to each
Flood Hazard Property, flood hazard insurance, as required by law and as
reasonably acceptable to the Administrative Agent in its Permitted
Discretion.  All such insurance shall be
in amounts, cover such assets and be under such policies as are customary in
the business of such Person and otherwise acceptable to the Administrative
Agent in its Permitted Discretion.  No
Loan Party will use or permit any property to be used in any manner which might
render inapplicable any insurance coverage, except as could not reasonably be
expected to have a Material Adverse Effect. 
Any cash or cash equivalent insurance or condemnation proceeds in excess
of $5,000,000 received by the Loan Parties from any casualty or condemnation
(or any related casualties or condemnations) at a time that cash dominion is in
effect pursuant to Section 7.1 of the Security Agreement shall be
immediately forwarded to the Administrative Agent and the Administrative Agent
shall apply any such proceeds to the reduction of the Obligations in accordance
with Section 2.12(b)(iv).


 


Section 5.10           Appraisals.  At any time that the Administrative Agent
requests, the Loan Parties will provide the Administrative Agent with
appraisals or updates thereof of their Inventory, Equipment and, if included in
the Borrowing Base, real property from
appraisers selected and engaged by the Administrative Agent, and prepared on a
basis satisfactory to the Administrative Agent, such appraisals and updates to
include, without limitation, information required by applicable law and
regulations; provided, however, that so long as no Event of
Default has occurred and is continuing, (i) the Borrower shall only be required
to reimburse the Administrative Agent in accordance with Section 9.03
for the cost of (a) one Inventory appraisal in any fiscal year and (b) one
additional Inventory appraisal in any such fiscal year in the event the average
daily Cash Availability Amount is less than or equal to $100,000,000 for any
calendar month during such fiscal year and (ii) the Borrower shall only be
required to reimburse the Administrative Agent in accordance with Section
9.03 for the cost of one set of such Equipment and real property appraisals
in any fiscal year and only in the event that the average daily Cash
Availability Amount is less than or equal to $150,000,000 for any calendar
month during such fiscal year. 
Notwithstanding the foregoing, prior to the first anniversary of the
Effective Date, the Administrative Agent shall not request appraisals of any
Inventory or Equipment or any real estate included in the Borrowing Base for
the purpose of redetermining the value thereof unless an Event of Default has
occurred and is continuing.  Thereafter,
the Administrative Agent shall not request appraisals of Equipment and real estate
included in the Borrowing Base for the purpose of redetermining the values
thereof unless (i) an Event of Default has occurred and is continuing or
(ii) the average daily Cash Availability Amount is less than $150,000,000
for any calendar month, in which event the Administrative Agent may request
such appraisals for the purpose of redetermining the values of Equipment and
real estate included in the Borrowing Base.


 


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Section 5.11           Additional
Collateral; Further Assurances. 
(a)  Subject to applicable law, each Loan Party shall, unless
the Required Lenders otherwise consent, cause each of its Subsidiaries
(excluding any Foreign Subsidiary) formed or acquired after the date of this
Agreement in accordance with the terms of this Agreement to become a Loan Party
by executing the Joinder Agreement set forth as Exhibit F hereto (the “Joinder
Agreement”) within thirty (30) days after the formation or acquisition
thereof. Upon execution and delivery thereof, each such Person (i) shall
automatically become a Loan Guarantor hereunder and thereupon shall have all of
the rights, benefits, duties, and obligations in such capacity under the Loan
Documents and (ii) will grant Liens to the Administrative Agent, for the
benefit of the Administrative Agent and the Lenders, in any property of such
Loan Party which constitutes Collateral as set forth in, and in accordance
with, the Collateral Documents.


 


(b) Each Loan Party will cause (i) 100% of the issued and
outstanding Equity Interests of each of its Domestic Subsidiaries (excluding
any Immaterial Subsidiary) and (ii) 65% of the issued and outstanding Equity
Interests in each Foreign Subsidiary (excluding, for the avoidance of doubt,
Canadian Fertilizers, Ltd.) directly owned by the Borrower or any Domestic Subsidiary
that is a Loan Party to be subject at all times to a first priority perfected
Lien in favor of the Administrative Agent pursuant to the terms and conditions
of the Loan Documents or other security documents as the Administrative Agent
shall reasonably request.


 


(c) Without limiting the foregoing, each Loan Party will, and will
cause each of its Subsidiaries which is required to become a Loan Party
pursuant to the terms of this Agreement to, execute and deliver, or cause to be
executed and delivered, to the Administrative Agent such documents and
agreements, and will take or cause to be taken such actions as the
Administrative Agent may, from time to time, reasonably request to carry out
the terms and conditions of this Agreement and the other Loan Documents.


 


ARTICLE
VI.


 


NEGATIVE COVENANTS


 


Until the Commitments have expired or been terminated and the principal
of and interest on each Loan and all fees payable hereunder have been paid in
full and all Letters of Credit have expired or terminated or been secured in
accordance with Section 2.07(j)(ii) and all LC Disbursements shall have
been reimbursed, each Loan Party executing this Agreement covenants and agrees,
jointly and severally with all of the Loan Parties executing this Agreement,
with the Lenders that:


 


Section 6.01           Indebtedness.  No Loan Party will, nor will it permit any of
its Subsidiaries to, create, incur or suffer to exist any Indebtedness, except:


 


(a) the Obligations;


 


(b) Indebtedness existing on the date hereof and set forth in Schedule 6.01
and extensions, renewals, refinancings and replacements of any such
Indebtedness in accordance with clause (l) hereof;


 


(c) Indebtedness of any Subsidiary Guarantor to any Loan Party;


 


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(d) Indebtedness of any Subsidiary that is not a Subsidiary
Guarantor to any other Subsidiary that is not a Subsidiary Guarantor;


 


(e) Indebtedness of any Subsidiary that is not a Subsidiary
Guarantor to any Loan Party to the extent that the credit extension creating such
Indebtedness is permitted under Section 6.04(h);


 


(f) Indebtedness of Foreign Subsidiaries (i) in the ordinary
course of business and (ii) other than in the ordinary course of business
in an aggregate principal amount not to exceed $10,000,000 at any time
outstanding;


 


(g) Guarantees by a Loan Party of Indebtedness of any other Loan
Party (other than the Parent) if the primary obligation is expressly permitted
elsewhere in this Section 6.01;


 


(h) Guarantees by any Subsidiary that is not a Subsidiary Guarantor
of Indebtedness of the Borrower or any of its Subsidiaries if the primary
obligation is otherwise expressly permitted elsewhere in this Section 6.01;


 


(i) Guarantees by a Loan Party of Indebtedness of any Subsidiary
that is not a Subsidiary Guarantor if the primary obligation is expressly
permitted elsewhere in this Section 6.01 and if the credit
extension creating such Guarantee is permitted under Section 6.04(h);


 


(j) Indebtedness of any Loan Party incurred to finance the
acquisition, construction or improvement of any property, plant and equipment,
including Capital Lease Obligations and any Indebtedness assumed in connection
with the acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof, and extensions, renewals, refinancings and
replacements of any such Indebtedness in accordance with clause (l) hereof; provided
that (i) such Indebtedness is incurred prior to or within 180 days after such
acquisition or the completion of such construction or improvement and (ii) the
aggregate principal amount of Indebtedness permitted by this clause (j) and
clause (k) of this Section shall not exceed $100,000,000 at any time
outstanding;


 


(k) purchase money Indebtedness incurred in connection with the
purchase of any property, plant and equipment, and extensions, renewals,
refinancings and replacements of any such Indebtedness in accordance with
clause (l) hereof; provided that, the amount of such purchase money
Indebtedness shall be limited to an amount not in excess of the purchase price
of such property, plant and equipment and the aggregate principal amount of
Indebtedness permitted by this clause (k) and clause (j) of this Section shall
not exceed $100,000,000 at any time outstanding;


 


(l) Indebtedness which represents an extension, replacement,
refinancing or renewal of any of the Indebtedness described in clauses (b),
(j), (k), (m)  and (o) hereof;
provided that, (i) the principal amount of such Indebtedness is not
increased except by the amount of any reasonable premium or other reasonable
amount paid, and fees and expenses reasonably incurred, in connection with such
extension, replacement, refinancing or renewal, (ii) any Liens securing such
Indebtedness are not extended to any additional property of any Loan Party,
(iii) no Loan Party that is not originally obligated with respect to repayment
of such Indebtedness is


 


69





















 


required to become obligated with respect
thereto unless such other Loan Party would otherwise be permitted elsewhere in
this Section to incur such Indebtedness, (iv) such extension, replacement,
refinancing or renewal does not result in a shortening of the average weighted
maturity of the Indebtedness so extended, replaced, refinanced or renewed, (v)
the terms of any such extension, refinancing, replacement or renewal are not,
taken as a whole, less favorable in any material respect to the obligor
thereunder than the original terms of such Indebtedness and (vi) if the
Indebtedness that is refinanced, replaced, renewed, or extended was
subordinated in right of payment to the Obligations, then the terms and
conditions of the refinancing, renewal, replacement or extension Indebtedness
must include subordination terms and conditions that, taken as a whole, are in
all material respects at least as favorable to the Administrative Agent and the
Lenders as those that were applicable to the refinanced, renewed, replaced or
extended Indebtedness;


 


(m) Indebtedness of
any Person that becomes a Subsidiary after the date hereof, and extensions,
renewals, refinancings and replacements of any such Indebtedness in accordance
with clause (l) hereof; provided that (i) such Indebtedness exists at
the time such Person becomes a Subsidiary and is not created in contemplation
of or in connection with such Person becoming a Subsidiary and (ii) in the case
of such Persons that become Loan Parties, the aggregate principal amount of
Indebtedness permitted by this clause (m) shall not exceed $25,000,000 at any
time outstanding;


 


(n) the Noteholders Obligations; provided that the Noteholders
Obligations shall be repaid in full (other than contingent obligations that
expressly survive the termination of the Noteholders Documents as to which no
material claims giving rise thereto have been asserted as of the time of such
repayment) within twenty (20) Business Days following the Effective Date with
monies deposited under the Noteholders Depository Agreement;


 


(o) Indebtedness of the Borrower and/or the Parent in an aggregate
principal amount not exceeding $300,000,000 and having terms satisfactory to
the Administrative Agent in its sole discretion, and extensions, renewals,
refinancings and replacements of such Indebtedness in accordance with clause
(l) hereof; which Indebtedness shall be unsecured except as permitted under
Section 6.02(t);


 


(p) Indebtedness in respect of deposits held under forward
purchasing arrangements entered into with customers in the ordinary course of
business;


 


(q) Indebtedness of any Loan Party or any of their respective
Subsidiaries in respect of performance, bid, surety, appeal or similar bonds or
completion or performance guarantees provided in the ordinary course of
business;


 


(r) Indebtedness of any Loan Party or any of their respective
Subsidiaries in respect of workers’ compensation claims or self-insurance
obligations otherwise permitted hereunder, in each case incurred in the
ordinary course of business;


 


(s) Indebtedness incurred by any Loan Party or any Subsidiary of a
Loan Party under any Swap Agreement otherwise permitted under this Agreement;


 


(t) [Intentionally omitted];


 


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(u) customary indemnification, reimbursement or similar
obligations and warranties under leases and other contracts in the ordinary
course of business;


 


(v) payment obligations of the Parent under the NOL Agreement;


 


(w) payment obligations of the Parent to any Subsidiary, or of any
Subsidiary to the Parent or any other Subsidiary, under any tax sharing
agreement;


 


(x) guarantees constituting investments expressly permitted by
Section 6.04 (excluding clause (d) thereof); and


 


(y) other unsecured Indebtedness in an aggregate principal amount
not exceeding $10,000,000 at any
time outstanding.


 


Section 6.02           Liens.  No Loan Party will, nor will it permit any
Subsidiary to, create, incur, assume or permit to exist any Lien on any
property or asset now owned or hereafter acquired by it, or assign or sell any
income or revenues (including accounts receivable) or rights in respect of any thereof,
except:


 


(a) Permitted Encumbrances;


 


(b) any Lien on any property or asset of any Loan Party or any of
its Subsidiaries existing on the date hereof and set forth in Schedule 6.02(b);
provided that (i) such Lien shall not apply to any other property or
asset of such Loan Party or Subsidiary (other than proceeds of the sale or
other disposition thereof) and (ii) such Lien shall secure only those
obligations which it secures on the date hereof and extensions, renewals,
replacements and refinancings of such obligations that do not increase the
outstanding principal amount thereof (except to the extent of any reasonable
fees, expenses and premium incurred in connection therewith);


 


(c) Liens securing purchase money Indebtedness of a Loan Party
permitted pursuant to clause (k) of Section 6.01; provided that, such
Liens attach only to the property which was purchased with the proceeds of such
purchase money Indebtedness;


 


(d) Liens on property, plant and equipment acquired, constructed
or improved by a Loan Party or any of its Subsidiaries; provided that
(i) such security interests secure Indebtedness permitted by
clause (j) of Section 6.01, (ii) such security interests
and the Indebtedness secured thereby are incurred prior to or within
180 days after such acquisition or the completion of such construction or
improvement, (iii) the Indebtedness secured thereby does not exceed 100%
of the cost of acquiring, constructing or improving such property, plant and
equipment and (iv) such security interests shall not apply to any other
property or assets of such Loan Party or Subsidiary;


 


(e) any Lien existing on any property or asset prior to the
acquisition thereof by a Person or existing on any property or asset of any
Person that becomes a Subsidiary after the date hereof prior to the time such
Person becomes a Subsidiary; provided that (i) such Lien is not
created in contemplation of or in connection with such acquisition or such
Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not
apply to any other property or assets of the Subsidiary and (iii) such Lien
shall secure only those obligations which it secures on the date


 


71





















 


of such acquisition or the date such Person
becomes a Subsidiary, as the case may be and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof (except to the extent of any reasonable fees, expenses and premium
incurred in connection therewith);


 


(f) Liens on assets of any Foreign Subsidiary securing
Indebtedness of such Foreign Subsidiaries permitted under clause (f) of Section
6.01;


 


(g) Liens granted in favor of the Noteholders (or one or more
agents for their benefit) in monies and other items deposited under the Noteholders
Depository Agreement;


 


(h) cash deposits made by the Borrower to secure Phosphogypsum
Stack Liability substantially in accordance with the payment schedule set forth
on Schedule 6.02(h) as such schedule may be updated (which update shall
not constitute an amendment, waiver or modification subject to Section 9.02)
from time to time by the Borrower, with the consent of the Administrative Agent
(not to be unreasonably withheld or delayed in the case of any change to such
payment schedule required in order to comply with the safe harbor provisions of
the Phosphogypsum Stack Rules);


 


(i) Liens arising solely by virtue of any statutory or common law
provision relating to banker’s Liens, rights of set-off or similar rights and
remedies as to deposit, securities and commodities accounts or other funds
maintained with a creditor depository institution or a securities or
commodities intermediary;


 


(j) Liens in favor of any Loan Party and Liens in favor of any
Subsidiary that is not a Subsidiary Guarantor securing obligations of any
Subsidiary that is not a Subsidiary Guarantor;


 


(k) Liens of sellers of goods to the Borrower and any of its
Subsidiaries arising under Article 2 of the Uniform Commercial Code or similar
provisions of applicable law in the ordinary course of business;


 


(l) any interest or title of a lessor, sublessor, licensee or
licensor under any lease or license agreement not prohibited by this Agreement;


 


(m) Liens securing Swap Agreements, limited to cash deposits not
to exceed $50,000,000 in the aggregate;


 


(n) Liens in favor of customs and revenue authorities arising by
operation of law to secure payment of customs duties in connection with the
importation of goods;


 


(o) Liens deemed to exist in connection with Investments in
repurchase agreements permitted under Section 6.04(a);


 


(p) Liens in favor of CoBank, ACB in all capital stock of CoBank,
ACB owned by the Borrower;


 


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(q) Liens of a collection bank arising under Section 4-210 of the
Uniform Commercial Code;


 


(r) Liens on real or personal property subject to the Pooling
Agreement;


 


(s) Liens existing on the Effective Date on any real property
which does not constitute Collateral and which Liens do not secure any monetary
obligation and could not reasonably be expected to have a Material Adverse
Effect;


 


(t) to the extent approved by the Administrative Agent in its sole
discretion, Liens securing Indebtedness permitted under Section 6.01(o) in an
aggregate principal amount not to exceed $100,000,000 at any time outstanding,
which Liens shall be subordinate to any Liens securing the Obligations on terms
acceptable to the Administrative Agent in its sole discretion;


 


(u) Liens on cash deposits pledged to the landlord of the Borrower’s
leased real property located in Tampa, Florida, as required for the delivery of
any Collateral Access Agreement (as defined in the Security Agreement), with
respect to such location; and


 


(v) Liens not otherwise permitted under this Section 6.02
securing Indebtedness, claims and other liabilities not in excess of
$10,000,000 in the aggregate at any time;


 


Notwithstanding the foregoing, none of the Liens permitted pursuant to
this Section 6.02 may at any time attach to any Loan Party’s (1)
Accounts, other than those permitted under clauses (a) and (g) of the
definition of Permitted Encumbrance and (2) Inventory, other than those
permitted under clauses (a), (b) and (g) of the definition of Permitted
Encumbrances.


 


Section 6.03           Fundamental
Changes.  (a)  No Loan Party
will, nor will it permit any Subsidiary (other than an Immaterial Subsidiary)
to, merge into or consolidate with any other Person, or permit any other Person
to merge into or consolidate with it, or sell, transfer, lease or otherwise
dispose of (in one transaction or in a series of transactions) any of its
assets, or any of the stock of any
of its Subsidiaries (in each case, whether now owned or hereafter acquired), or
liquidate or dissolve, except that, if at the time thereof and immediately
after giving effect thereto no Event of Default shall have occurred and be
continuing (i) any Subsidiary of the Borrower may liquidate, dissolve,
merge or consolidate into the Borrower in a transaction in which the Borrower
is the surviving corporation; (ii) any Subsidiary Guarantor may liquidate,
dissolve, merge or consolidate into any Subsidiary Guarantor in a transaction
in which the surviving entity is a Subsidiary Guarantor; (iii) any Loan Party
or any Subsidiary may sell, transfer, lease or otherwise dispose of (1) its assets
to any Loan Party (other than the Parent); provided that the Borrower shall not
sell, transfer, lease or otherwise dispose of its assets, (2) Inventory in the
ordinary course of business, (3) assets constituting property, plant and
equipment that are uneconomical, obsolete, worn out or no longer used or useful
in its business or constitute surplus and which are disposed of in the ordinary
course of business and (4) other assets (other than any disposition of
property, plant and equipment as part of a Permitted Sale and Leaseback
Transaction) having a market value not exceeding $5,000,000 in the aggregate in any fiscal year
(provided that if the aggregate market value of such assets disposed of in any
fiscal year is less than the amount permitted hereunder, such unused amount may
be carried-forward


 


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and added to the amount
permitted hereunder for the immediately succeeding fiscal year, with any
dispositions during such succeeding fiscal year being allocated first against
the amount permitted for such fiscal year before being allocated to such
carry-forward amount); (iv) any Subsidiary that is not a Subsidiary Guarantor
may liquidate or dissolve, and may sell, transfer, lease or otherwise dispose
of its assets if the Borrower determines in good faith that such liquidation,
dissolution, sale, transfer, lease or disposition could not reasonably be
expected to have a Material Adverse Effect; provided that any such
merger involving a Person that is not a wholly owned Subsidiary immediately
prior to such merger shall not be permitted unless also permitted by Section 6.04;
(v) the Parent and the Borrower may consummate the Reorganization Transaction;
(vi) as part of any Acquisition permitted under Section 6.04(h), any
Subsidiary of the Borrower may merge into or consolidate with any other Person
or permit any other Person to merge into or consolidate with it in a
transaction in which the survivor is a wholly-owned Subsidiary of the Borrower;
provided that in the case of any such merger or consolidation to which a
Subsidiary Guarantor is a party, the surviving entity in such merger or
consolidation shall be a Subsidiary Guarantor; (vii) bona fide sales, transfers
and other dispositions of (A) Permitted Investments, (B) Investments permitted
under clauses (g), (l), (m) and (u) of Section 6.04 and (C) investments in
Joint Ventures and minority interests; (viii) the Parent, the Borrower and each
Subsidiary may make payments and other transactions permitted by Section 6.06;
(ix) the Parent, the Borrower and each Subsidiary may, lease, sublease, license
or sublicense any property, plant and equipment or intellectual property in the
ordinary course of business, including without limitation the lease of vacant
land for farming or for the exploration and production of oil, gas, sulphur and
other minerals; (x) the Parent, the Borrower and each Subsidiary may sell or
otherwise dispose of delinquent Accounts in the ordinary course of business for
purposes of collection only (and not for the purpose of any bulk sale or
securitization transaction); (xi) the Parent, the Borrower and each Subsidiary
may surrender or waive contractual rights or settle, release or surrender any
contract, tort or other litigation claims in the ordinary course of business;
(xii) the Parent, the Borrower and each Subsidiary may grant Liens permitted by
Section 6.2 of this Agreement; (xiii) the Parent and its Subsidiaries
may sell, transfer or otherwise dispose of property, plant and equipment in a
Permitted Sale and Leaseback Transaction; (xiv) the Parent and its
Subsidiaries may abandon or dispose of intellectual property or other
proprietary rights of the Borrower or any Subsidiary that are, in the
reasonable business judgment of the Borrower or any Subsidiary, no longer
practicable to maintain or useful in the conduct of the business of the
Borrower or any Subsidiary; and (xv) the Parent and its Subsidiaries may make
the dispositions described on Schedule 6.03.  The Net Cash Proceeds of any sale or disposition
permitted pursuant to this Section 6.03 shall be delivered to the
Administrative Agent if and to the extent required by Sections 2.11 and 2.12
and applied to the Obligations as set forth therein.


 


(b) No Loan Party will, nor will it permit any of its Subsidiaries
to, engage in any business other than businesses of the type generally
conducted by the Borrower and its Subsidiaries on the date of execution of this
Agreement and businesses reasonably related thereto or reasonable extensions or
expansions thereof.


 


Section 6.04           Investments,
Loans, Advances, Guarantees and Acquisitions.  No Loan Party will, nor will it permit any of
its Subsidiaries to, purchase, hold or acquire (including pursuant to any
merger with any Person that was not a Loan Party and a wholly owned Subsidiary
prior to such merger) any capital stock, evidences of indebtedness or other
securities


 


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(including any option, warrant
or other right to acquire any of the foregoing) of, make or permit to exist any
loans or advances to, Guarantee any obligations of, or make or permit to exist
any investment or any other interest in, any other Person, or purchase or
otherwise acquire (in one transaction or a series of transactions) any assets
of any other Person constituting a business unit (whether through purchase of
assets, merger or otherwise), except:


 


(a) Permitted Investments, subject
to control agreements (with respect to Loan Parties) in favor of the
Administrative Agent for the benefit of the Lenders or otherwise subject to a
perfected security interest in favor of the Administrative Agent for the
benefit of the Lenders;


 


(b) investments by the Loan Parties and their Subsidiaries
existing on the date hereof in the capital stock or other Equity Interests of
their respective Subsidiaries;


 


(c) investments, loans or advances made by a Loan Party to any
Subsidiary Guarantor;


 


(d) Guarantees permitted by Section 6.01 (excluding clause
(x) thereof);


 


(e) investments, loans and advances in existence on the date of
this Agreement and described in Schedule 6.04 and any extensions or
renewals thereof which do not increase the amount thereof or conversions of any
such loans or advances to equity investments;


 


(f) loans, advances or other extensions of credit made by a Loan
Party or any Subsidiary to its employees, officers and directors in the
ordinary course of business for travel and entertainment expenses, relocation
costs and similar purposes up to a maximum of $5,000,000 in the aggregate at any one time
outstanding;


 


(g) subject to Sections 4.2(a) and 4.4 of the
Security Agreement, notes payable, or stock or other securities issued by
Account Debtors to a Loan Party pursuant to negotiated agreements with respect
to settlement of such Account Debtor’s Accounts in the ordinary course of
business;


 


(h)(i) investments, loans or advances made by any Loan Party to any
Subsidiary which is not a Subsidiary Guarantor, (ii) investments in any Joint
Venture (including the Trinidad Joint Venture) and minority interests and (iii)
investments made in order to consummate Acquisitions; provided, that (1)
no Event of Default shall have occurred and be continuing or would result
therefrom, (2) immediately before and immediately after giving effect to any
such investment and to any related Borrowing, the aggregate amount of such
investments, loans and advances then outstanding after giving effect to returns
of capital received in respect of such investments shall not exceed the
Permitted Amount and (3) in the case of any Acquisition, (A) such Acquisition
shall only comprise a business or those assets of a business, of the type
generally conducted by the Borrower and its Subsidiaries as of the Effective
Date or a business reasonably related thereto or a reasonable extension or
expansion thereof and (B) such Acquisition shall be consensual and shall have
been approved by the board of directors or equivalent governing body of the
acquiree or the parent of the acquiree;


 


(i) investments in Swap Agreements otherwise permitted by this
Agreement;


 


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(j) prepaid expenses in the ordinary course of business, lease,
utility, workers’ compensation, performance and other similar deposits in the
ordinary course of business and deposits made by the Borrower to secure
Phosphogypsum Stack Liability to the extent permitted under Section 6.02;


 


(k) Investments received as consideration from any sale, lease,
transfer or other disposition permitted by

Section 6.03(a);


 


(l) investments received in satisfaction of judgments, settlements
of debts or compromises of obligations or as consideration for the settlement,
release or surrender of a contract, tort or other litigation claim, in each
case in the ordinary course of business, including, without limitation,
pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of any trade creditor or customer;


 


(m) investments that are deemed to have been made as a result of
an Acquisition of a Person that at the time of such Acquisition held
instruments constituting investments that were not acquired in contemplation of
such Acquisition;


 


(n) advances and prepayments for asset purchases in the ordinary
course of business;


 


(o) deposits of cash with banks or other depository institutions
in the ordinary course of business;


 


(p) any investment or acquisition of assets solely in exchange for
the issuance of Equity Interests of the Parent;


 


(q) any investment, loan or advance made solely to fund any Loan
Party’s deferred compensation plans for employees and non-employee directors or
any successor plans approved by the Board of Directors of such Loan Party;


 


(r) investments consisting of extensions of credit in the nature
of accounts receivable or notes receivable arising from the granting of trade
credit in the ordinary course of business;


 


(s) (1) investments in CFL to fund Capital Expenditures by CFL in
an aggregate amount not to exceed $10,000,000 during any fiscal year (provided
that if the aggregate amount of such investments in any fiscal year is less
than the amount permitted hereunder, such unused amount may be carried forward
and added to the amount permitted hereunder for the immediately succeeding
fiscal year, with any such investments during such succeeding fiscal year being
allocated first against the amount permitted for such fiscal year before being
allocated to such carryforward); and (2) other investments in CFL in an
aggregate amount during any fiscal year not to exceed the aggregate amount of
earnings of CFL distributed in cash to the Borrower with respect to such fiscal
year;


 


(t) Restricted Payments permitted by Section 6.06; and


 


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(u) guarantees, investments, loans and advances not otherwise
permitted under this Section 6.04 in an aggregate amount not to exceed
$5,000,000 at any time outstanding after giving effect to returns of capital
and principal payments received in respect of such guarantees, investments,
loans and advances.


 


Section 6.05           Swap
Agreements.  No Loan Party will, nor
will it permit any of its Subsidiaries to, enter into any Swap Agreement,
except (a) Swap Agreements entered into to hedge or mitigate risks to which any
Loan Party or any Subsidiary has actual exposure (other than those in respect of
Equity Interests of any Loan Party or any of its Subsidiaries), and (b) Swap
Agreements entered into in order to effectively cap or collar interest rates
with respect to any interest-bearing liability of any Loan Party or any
Subsidiary or to exchange interest rates (from fixed to floating rates, from
one floating rate to another floating rate or otherwise) with respect to any
interest-bearing investment of any Loan Party or any Subsidiary.


 


Section 6.06           Restricted
Payments.  No Loan Party will, nor
will it permit any of its Subsidiaries to, declare or make, or agree to pay or
make, directly or indirectly, any Restricted Payment, except:


 


(a) any Loan Party may declare and pay dividends with respect to
its Equity Interests payable solely in additional shares (or options or
warrants with respect to such shares) of its Equity Interests having equal or
inferior voting power, designations, preferences and rights;


 


(b) Subsidiaries of the Borrower may declare and pay dividends
ratably with respect to their Equity Interests;


 


(c) the Borrower may make Restricted Payments pursuant to and in
accordance with stock option plans or other benefit plans for management or
employees of the Borrower and its Subsidiaries;


 


(d) the Borrower and each Subsidiary may make Restricted Payments
(directly or indirectly) to the Parent or the Borrower that are used by the
Parent or the Borrower, as the case may be, to pay federal, state and local
income taxes then due and owing, franchise taxes and other similar expenses and
operating expenses incurred in the ordinary course of business;


 


(e) the Parent may make Restricted Payments to the Affiliated
Cooperatives on the Effective Date with the proceeds of the IPO;


 


(f) dividends may be paid by the Parent on shares of its common
stock within sixty (60) days after the date of declaration thereof, so long as
such dividend would have been permitted under clause (o) hereof if paid on the
date of such declaration;


 


(g) the Parent and the Borrower may make Restricted Payments on
the Effective Date in connection with, and pursuant to the terms of, the
Reorganization Transaction;


 


(h) the Parent or any Subsidiary of the Parent may repurchase,
redeem, retire or otherwise acquire any outstanding Equity Interests of Parent
or any of its Subsidiaries that have been held or beneficially owned by any
employee, officer or director of such Person (or similarly


 


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related individual) upon the death,
disability, termination or similar event which ends the relationship between
such Person and such individual;


 


(i) the Parent or any of its Subsidiaries may repurchase, redeem
or otherwise acquire or retire for value any Equity Interests in the Parent or
any of its Subsidiaries that is held by any current or former employee,
director or consultant (or their estates or the beneficiaries of such estates)
of the Parent or any of its Subsidiaries; provided that the aggregate
price paid for all such repurchased, redeemed, acquired or retired Equity
Interests, shall not exceed $10,000,000 during any fiscal year, provided,
further, that any amount not utilized shall be carried forward to the next
succeeding fiscal year with any such acquisitions during such succeeding fiscal
year being allocated first against the amount permitted in such fiscal year
before being allocated to such carryforward);


 


(j) the Borrower’s purchase, redemption, retirement, acquisition,
cancellation or termination of any Equity Interests with the proceeds received
contemporaneously from the issue of new Equity Interests with equal or inferior
voting powers, designations, preferences and rights;


 


(k) the Parent or any of its Subsidiaries may make repurchases of
Equity Interests deemed to occur upon the exercise of stock options if such
Equity Interests represent a portion of the exercise price thereof;


 


(l) the Borrower or any of its Subsidiaries may make any purchase
or acquisition from, or retain any withholding on issuances to, any employee of
the Borrower or any of its Subsidiaries of Equity Interests to satisfy any
applicable federal, state or local tax payments in respect of the receipt of
Equity Interests of the Borrower or any of its Subsidiaries;


 


(m) the Borrower may make cash dividends to the Parent to make
principal and interest payments on Indebtedness permitted by Section 6.01(o);


 


(n) any Subsidiary may accept capital contributions from its
parent to the extent permitted under Section 6.04; and


 


(o) the Loan Parties may make Restricted Payments from time to
time not otherwise permitted hereunder so long as immediately before and
immediately after giving effect to such Restricted Payments and to any related
Borrowings (1) no Event of Default shall have occurred and be continuing or
would result therefrom, (2) the Cash Availability Amount exceeds $85,000,000
and (3) the aggregate amount of such Restricted Payments made during any fiscal
year (together with the aggregate amount of any Restricted Payments declared
during such fiscal year and permitted under clause (d) hereof) does not exceed
the Permitted Restricted Payment Amount for such fiscal year.


 


Section 6.07           Transactions
with Affiliates.  No Loan Party will,
nor will it permit any of its Subsidiaries to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any
property or assets from, or otherwise engage in any other transactions with,
any of its Affiliates, except (a) in the ordinary course of business at prices
and on terms and conditions not materially less favorable to the Loan Party or such
Subsidiary than could be obtained on an arm’s-length basis from third parties
not affiliated with each other,


 


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(b) transactions between or
among a Loan Party and another Loan Party not involving any other Affiliate,
(c) any Restricted Payment permitted by Section 6.06 and investments,
loans, advances and Guarantees permitted under clauses (b), (c), (d), (e), (f),
(h), (s) and (w) of Section 6.04, (d) any transaction permitted by
clauses (i), (ii), (iii), (iv), (v) or (vi) of Section 6.03, (e) payment
of reasonable fees, expenses and compensation to officers and directors of any
Loan Party and its Subsidiaries and customary indemnification and insurance
arrangements in favor of any director or officer of any Loan Party and its
Subsidiaries, and any agreement relating to any of the foregoing entered into
in the ordinary course of business, (f) the NOL Agreement; (g) the
Reorganization Transaction, (h) Indebtedness owing from any Loan Party or any
of its Subsidiaries to any other Loan Party and any of it Subsidiaries
permitted under Section 6.01, and (i) any agreements in existence and as
in effect on the Effective Date (including, without limitation, any
shareholders agreements or registration rights agreements with existing equity
holders), as set forth on Schedule 6.07, as such agreements may be
renewed, replaced or otherwise modified after the Effective Date upon terms
which taken as a whole are not less favorable to the Loan Parties and their
Subsidiaries than the original terms of such agreements.


 


Section 6.08           Restrictive
Agreements.  No Loan Party will, nor
will it permit any of its Subsidiaries to, directly or indirectly, enter into,
incur or permit to exist any agreement or other arrangement that prohibits,
restricts or imposes any condition upon (a) the ability of such Loan Party or
any of its Subsidiaries to create, incur or permit to exist any Lien upon any
of its property or assets, or (b) the ability of any Subsidiary of a Loan Party
to pay dividends or other distributions with respect to any shares of its
capital stock or to make or repay loans or advances to the Borrower or any
other Subsidiary of the Borrower or to Guarantee Indebtedness of the Borrower
or any other Subsidiary of the Borrower; provided that (i) the foregoing
shall not apply to restrictions and conditions imposed by law, rule, regulation
or order or by any Loan Document, (ii) the foregoing shall not apply to
restrictions and conditions existing on the date hereof identified on Schedule 6.08
(but shall apply to any extension, renewal, amendment or modification expanding
in any material respect the scope of any such restriction or condition), (iii)
the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to the sale or other disposition of a
Subsidiary pending such sale or disposition, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold or disposed of and
such sale or disposition is permitted hereunder, (iv) the foregoing shall not
apply to restrictions and conditions imposed under any agreement evidencing
Indebtedness existing on the date hereof or permitted under Section 6.01(o)
as in effect on the date such agreement is entered into and, in each case, any
amendment, modification, extension, renewal, refinancing or replacement of any
such Indebtedness, provided, that such amendment, modification,
restatement, renewal, refinancing or replacement does not expand in any
material respect the scope of any such restriction or condition contained in
the agreements evidencing such Indebtedness as in effect on the date hereof, in
the case of Indebtedness existing on the date hereof, or as in effect on the
date such agreement is entered into, in the case of Indebtedness permitted
under Section 6.01(o), (v) clause (a) of the foregoing shall not
apply to restrictions or conditions imposed by any agreement relating to
secured Indebtedness permitted by this Agreement if such restrictions or
conditions apply only to the property or assets securing such Indebtedness,
(vi) clause (a) of the foregoing shall not apply to customary provisions in
leases restricting the assignment thereof, (vii) the foregoing shall not apply
to any restriction or conditions imposed by any instrument governing
Indebtedness or Equity Interests of a Person acquired by the Parent or any of
its Subsidiaries as in effect at the time of such acquisition


 


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(except to the extent such
Indebtedness was incurred in connection with or in contemplation of such
acquisition), which encumbrance or restriction is not applicable to any Person,
or the properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired, (viii) the foregoing shall not
apply to any restrictions or conditions imposed by any instrument governing
Indebtedness of a Foreign Subsidiary permitted by Section 6.01, which
restriction is not applicable to any Person, or the property or assets of any
Person, other than such Foreign Subsidiary and (ix) clause (a) of the foregoing
shall not apply to customary restrictions and conditions contained in
agreements relating to the sale of property permitted by Section 6.03
pending the consummation of such sale, provided such restrictions and
conditions apply only to the property that is to be sold.


 


Section 6.09           Prepayment
of Indebtedness; Subordinated Indebtedness. 
(a)  No Loan Party shall, directly or indirectly, voluntarily
purchase, redeem, defease or prepay any principal of, premium, if any, interest
or other amount payable in respect of any Indebtedness prior to its scheduled
maturity or required payments therefor, other than (i) the Obligations;
(ii) Indebtedness secured by a Permitted Encumbrance if the asset securing such
Indebtedness has been sold or otherwise disposed of in accordance with Section
6.03; (iii) Indebtedness permitted by Section 6.01(b), (j), (k),
(m) or (o) upon any refinancing or replacement thereof in
accordance with Section 6.01(l); (iv) Indebtedness permitted by Section
6.01(c), (d), (e), (f) or (n); provided that the
foregoing restriction shall not apply if, immediately before and immediately
after giving effect to any such purchase, redemption, defeasance or prepayment
and to any related Borrowings (A) no Event of Default shall have occurred and
be continuing and (B) the Cash Availability Amount exceeds $135,000,000.


 


(b)           No Loan Party shall (i)
make any amendment or modification to any indenture, note or other agreement
evidencing or governing any Subordinated Indebtedness, or (ii) directly or
indirectly voluntarily prepay, defease or in substance defease, purchase,
redeem, retire or otherwise acquire, any Subordinated Indebtedness unless
immediately before and immediately after giving effect to any such purchase,
redemption, defeasance or prepayment and to any related Borrowings (A) no Event
of Default shall have occurred and be continuing and (B) the Cash Availability
Amount exceeds $135,000,000.


 


Section 6.10           Depository
Banks.  Each Loan Party will maintain
the Administrative Agent (or Harris Trust and Savings Bank, so long as it is a
Lender) as such Loan Party’s principal depository bank.


 


Section 6.11           Capital
Expenditures.  The Loan Parties and
their Subsidiaries shall not make any Capital Expenditure which would result in
the aggregate amount of Capital Expenditures for the applicable measurement
period exceeding the Permitted Capital Expenditure Amount.


 


Section 6.12           Fixed
Charge Coverage Ratio.  If the
average daily Cash Availability Amount for any calendar month shall be less
than $50,000,000 (such occurrence, a “triggering event”), thereafter the
Borrower will not permit the Fixed Charge Coverage Ratio, determined as of the
end of each of its fiscal quarters for the then most-recently ended four fiscal
quarters (commencing with the end of the most recent fiscal quarter preceding
such triggering event), to be less than 1.15 to 1.0.


 


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Section 6.13           Parent;
Immaterial Subsidiaries.  The Parent
shall not engage in any trade or business, or own any assets (other than the
Equity Interests or Indebtedness for borrowed money of the Borrower) or incur
any Indebtedness (other than the Obligations or Indebtedness permitted pursuant
to Section 6.1(o)).  The
Immaterial Subsidiaries shall not engage in any material trade or business or
own any material assets or incur any material Indebtedness other than
intercompany Indebtedness.


 


ARTICLE
VII.


 


EVENTS OF DEFAULT


 


If any of the following events (“Events of Default”) shall occur
and be continuing:


 


(a) the Borrower shall fail to pay any principal of any Loan or
any reimbursement obligation in respect of any LC Disbursement when and as the
same shall become due and payable, whether at the due date thereof or at a date
fixed for prepayment thereof or otherwise;


 


(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in clause (a) of
this Article) payable under this Agreement, when and as the same shall become
due and payable, and such failure
shall continue unremedied for a period of three (3) Business Days;


 


(c) any representation or warranty made or deemed made by or on
behalf of any Loan Party or any Subsidiary of any Loan Party in this Agreement
or any Loan Document or any amendment or modification thereof or waiver
thereunder, or in any report, certificate, financial statement or other
document furnished pursuant to or in connection with this Agreement or any Loan
Document or any amendment or modification thereof or waiver thereunder, shall
prove to have been materially incorrect when made or deemed made;


 


(d) any Loan Party shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.02(a), or 5.08
or in Article VI;


 


(e) any Loan Party shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement or the other Loan Documents
(other than those which constitute a default under another Section of this
Article), and such failure shall continue unremedied for a period of (i) ten
(10) days after the earlier of (A) a Financial Officer’s or other Responsible
Officer’s (in each case of the Borrower) actual knowledge of such breach or
(B) notice thereof from the Administrative Agent (which notice will be
given at the request of any Lender) if such breach relates to terms or
provisions of Section 5.01, 5.02 (other than Section 5.02(a)),
5.03 through 5.10 of this Agreement or (ii) thirty (30) days after the earlier
of (A) a Financial Officer’s or other Responsible Officer’s (in each case of
the Borrower) actual knowledge of such breach or (B) notice thereof from the
Administrative Agent (which notice will be given at the request of any Lender)
if such breach relates to terms or provisions of any other Section of this
Agreement or the other Loan Documents;


 


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(f) any Loan Party or any Subsidiary shall fail to make any
payment (whether of principal or interest and regardless of amount) in respect
of any Material Indebtedness, when and as the same shall become due and
payable;


 


(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables or
permits (in each case, after giving effect to any applicable grace or notice
period) the holder or holders of any such Material Indebtedness or any trustee
or agent on its or their behalf to cause any such Material Indebtedness to
become due, or to require the prepayment, repurchase, redemption or defeasance
thereof, prior to its scheduled maturity; provided that this
clause (g) shall not apply to secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets securing
such Indebtedness;


 


(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of a Loan Party or any Subsidiary of any Loan Party (other
than any Immaterial Subsidiary) or its debts, or of a substantial part of its
assets, under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect or (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for any Loan Party or any Subsidiary of any Loan Party (other
than any Immaterial Subsidiary) or for a substantial part of its assets, and,
in any such case, such proceeding or petition shall continue undismissed for
60 days or an order or decree approving or ordering any of the foregoing
shall be entered;


 


(i) any Loan Party or any Subsidiary of any Loan Party (other than
any Immaterial Subsidiary) shall (i) voluntarily commence any proceeding
or file any petition seeking liquidation, reorganization or other relief under
any Federal, state or foreign bankruptcy, insolvency, receivership or similar
law now or hereafter in effect, (ii) consent to the institution of, or
fail to contest in a timely and appropriate manner, any proceeding or petition
described in clause (h) of this Article, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for such Loan Party or any Subsidiary of any Loan Party (other
than any Immaterial Subsidiary) or for a substantial part of its assets,
(iv) file an answer admitting the material allegations of a petition filed
against it in any such proceeding, (v) make a general assignment for the
benefit of creditors or (vi) take any action for the purpose of effecting
any of the foregoing;


 


(j) any Loan Party or any Subsidiary of any Loan Party (other than
any Immaterial Subsidiary) shall become unable, admit in writing its inability
or fail generally to pay its debts as they become due;


 


(k) one or more judgments for the payment of money in an aggregate
amount in excess of $20,000,000 (except to the extent covered by insurance)
shall be rendered against any Loan Party, any Subsidiary of any Loan Party or
any combination thereof and the same shall remain undischarged for a period of
forty-five (45) consecutive days during which execution shall not be
effectively stayed, or any action shall be legally taken by a judgment creditor
to attach or levy upon any assets of any Loan Party to enforce any such judgment;


 


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(l) an ERISA Event shall have occurred that, when taken together
with all other ERISA Events that have occurred, could reasonably be expected to
have a Material Adverse Effect;


 


(m)  a Change in Control shall occur;


 


(n) the Loan Guaranty shall fail to remain in full force or effect
or any action shall be taken to discontinue or to assert the invalidity or
unenforceability of the Loan Guaranty, or any Loan Guarantor shall deny that it
has any further liability under the Loan Guaranty to which it is a party, or
shall give notice to such effect;


 


(o) any Collateral Document shall for any reason fail to create a
valid and perfected first priority security interest in any Collateral
purported to be covered thereby, except as permitted by the terms of this
Agreement or any Collateral Document, or any Collateral Document (other than
Collateral Documents which collectively cover an immaterial amount of
Collateral) shall fail to remain in full force or effect (except as otherwise
expressly provided in this Agreement or such Collateral Document) or any action
shall be taken by any Loan Party to discontinue or to assert the invalidity or
unenforceability of any such Collateral Document; or


 


(p) any material provision of any Loan Document for any reason
ceases to be valid, binding and enforceable in accordance with its terms
(except as otherwise expressly provided in this Agreement or such Loan
Document) (or any Loan Party shall challenge the enforceability of any Loan
Document or shall assert in writing, or engage in any action or inaction based
on any such assertion, that any material provision of any of the Loan Documents
has ceased to be or otherwise is not valid, binding and enforceable in
accordance with its terms);


 


then, and in every such event (other than an event with respect to the
Borrower described in clause (h) or (i) of this Article), the Administrative
Agent may, and at the request of the Required Lenders shall, by notice to the
Borrower, take either or both of the following actions, at the same or
different times:  (i) terminate the Commitments, and thereupon
the Commitments shall terminate immediately, and (ii) declare the Loans
then outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to
be due and payable), and thereupon the principal of the Loans so declared to be
due and payable, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower; and in case of any event with
respect to the Borrower described in clause (h) or (i) of this Article, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall automatically become due
and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower. 
Upon the occurrence and the continuance of an Event of Default, the
Administrative Agent may, and at the request of the Required Lenders shall
exercise any rights and remedies provided to the Administrative Agent under the
Loan Documents or at law or equity, including all remedies provided under the
UCC.


 


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ARTICLE
VIII.


 


THE ADMINISTRATIVE AGENT


 


Each of the Lenders and the Issuing Banks hereby irrevocably appoints
the Administrative Agent as its agent 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 of the Loan Documents, together with
such actions and powers as are reasonably incidental thereto.


 


The bank 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 such bank
and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of business with the Loan Parties or any Subsidiary of a Loan Party
or other Affiliate thereof as if it were not the Administrative Agent
hereunder.


 


The Administrative Agent shall not have any duties or obligations
except those expressly set forth in the Loan Documents.  Without limiting the generality of the
foregoing, (a) the Administrative Agent shall not be subject to any
fiduciary or other implied duties, regardless of whether an Event of Default
has occurred and is continuing, (b) the Administrative Agent shall not
have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated by the
Loan Documents that the Administrative Agent is required to exercise in writing
as directed by the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in Section
9.02), and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be liable
for the failure to disclose, any information relating to any Loan Party or any
of its Subsidiaries that is communicated to or obtained by the bank serving as
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 with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as
shall be necessary under the circumstances as provided in Section 9.02)
or in the absence of its own gross negligence or willful misconduct.  The Administrative Agent shall be deemed not
to have knowledge of any Event of Default unless and until written notice
thereof is given to the Administrative Agent by the Borrower or a Lender, and
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 any Loan Document, (ii) the contents of any
certificate, report or other document delivered hereunder or in connection with
any Loan Document, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth in any Loan
Document, (iv) the validity, enforceability, effectiveness or genuineness
of any Loan Document or any other agreement, instrument or document, or
(v) the satisfaction of any condition set forth in Article IV, the
Closing Checklist or elsewhere in any Loan Document, other than to confirm
receipt of items expressly required to be delivered to the 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,


 


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document or other writing
believed by it to be genuine and to have been signed or sent 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 be made by the proper Person, and shall not incur any liability for
relying thereon.  The Administrative
Agent may consult with legal counsel (who may be counsel for the Borrower),
independent accountants and other experts selected by it in its reasonable
discretion, 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 selected
by it in good faith.


 


The Administrative Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more sub-agents
selected with reasonable care and appointed by the Administrative Agent.  The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. 
The exculpatory provisions of the preceding paragraphs 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.


 


Subject to the appointment and acceptance of a successor Administrative
Agent as provided in this paragraph, the Administrative Agent may resign at any
time upon 30 days prior written notice to the Lenders, the Issuing Banks and
the Borrower.  Upon any such resignation,
the Required Lenders shall have the right, to appoint a successor which shall
be a Lender and which shall (unless an Event of Default has occurred and is
continuing) be subject to approval by the Borrower (such approval not to be
unreasonably withheld or delayed).  If no
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 Issuing Bank, appoint a successor
Administrative Agent which shall be a commercial bank or an Affiliate of any
such commercial bank and which shall (unless an Event of Default has occurred
and is continuing) be subject to approval by the Borrower (such approval not to
be unreasonably withheld or delayed). 
Upon the acceptance of its appointment as Administrative Agent hereunder
by a successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and obligations
hereunder.  The fees payable by the
Borrower to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor.  After the Administrative
Agent’s resignation hereunder, the provisions of this Article and Section 9.03
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 it was acting as
Administrative Agent.


 


Each Lender acknowledges that 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 Agreement.  Each Lender also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it shall from time to
time deem appropriate, continue to make its own decisions in


 


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taking or not taking action
under or based upon this Agreement, any other Loan Document or related
agreement or any document furnished hereunder or thereunder.


 


The Administrative Agent shall have no obligation to any of the Lenders
to ensure that the Collateral exists, is owned by the Loan Parties, is cared
for, protected or insured, is unencumbered by others, or that the Liens granted
to the Administrative Agent therein have been properly, sufficiently or
lawfully created, perfected, protected or enforced, or that such Liens are
entitled to any particular priority, it being understood and agreed that in
respect of the Collateral, or any act, omission, or event related thereto, the
Administrative Agent may act in any manner it may deem appropriate, in its sole
discretion given the Administrative Agent’s own interest in the Collateral in
its capacity as one of the Lenders and that the Administrative Agent shall have
no other duty or liability whatsoever to any Lender as to any of the foregoing.


 


Each Lender hereby appoints each other Lender as its agent for the
purpose of perfecting Liens, for the benefit of the Administrative Agent and
the Lenders, in assets which, in accordance with Article 9 of the UCC or any
other applicable law can be perfected only by possession.  Should any Lender (other than the
Administrative Agent) obtain possession of any such Collateral, such Lender
shall notify the Administrative Agent thereof, and, promptly upon the
Administrative Agent’s request therefor shall deliver such Collateral to the
Administrative Agent or otherwise deal with such Collateral in accordance with
the Administrative Agent’s instructions.


 


Each Lender hereby agrees that (a) it is deemed to have requested that
the Administrative Agent furnish such Lender, promptly after it becomes
available, a copy of each Report prepared by or on behalf of the Administrative
Agent; (b) the Administrative Agent (i) makes no representation or warranty,
express or implied, as to the completeness or accuracy of any Report or any of
the information contained therein or any inaccuracy or omission contained in or
relating to a Report, or (ii) shall not be liable for any information contained
in any Report; (c) the Reports are not comprehensive audits or examinations,
and that the Administrative Agent or any other party performing any audit or
examination will inspect only specific information regarding the Loan Parties
and will rely significantly upon the Loan Parties’ books and records, as well
as on representations of the Loan Parties’ personnel and that the
Administrative Agent undertakes no obligation to update, correct or supplement
the Reports; (d) it will keep all Reports confidential and strictly for its
internal use, not share the Report with any Loan Party and not to distribute
any Report to any other Person except as otherwise permitted pursuant to Section
9.12; and (e) without limiting the generality of any other indemnification
provision contained in this Agreement, it will pay and protect, and
indemnify, defend, and hold the Administrative Agent and any such other Person
preparing a Report harmless from and against, the claims, actions, proceedings,
damages, costs, expenses, and other amounts (including reasonable attorney
fees) incurred by the Administrative Agent and any such other Person preparing
a Report as the direct or indirect result of any third parties who might obtain
all or part of any Report through the indemnifying Lender.


 


Each Lender shall, upon the request of the Administrative Agent,
provide the Administrative Agent with such information as the Administrative
Agent may reasonably request regarding any Banking Service Obligations or Swap
Obligations owing to such Lender or its Affiliates.


 


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The Co-Syndication Agents and Co-Documentation Agents shall not have
any right, power, obligation, liability, responsibility or duty under this
Agreement other than those applicable to all Lenders as such.


 


ARTICLE
IX.


 


MISCELLANEOUS


 


Section 9.01           Notices.  (a)  Except in the case of notices
and other communications expressly permitted to be given by telephone (and
subject to paragraph (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 facsimile or by
e-mail, as follows:


 


(i)            if to any Loan Party,
to the Borrower at:


 


CF Industries, Inc.

One Salem Lake Drive

Long Grove, Illinois  60047-8402

Attention:  Douglas C. Barnard, Esq.

Facsimile No:  (847) 438-2005

E-mail:  dbarnard@cfindustries.com


 


(ii)           if to the
Administrative Agent, the Issuing Bank or the Swingline Lender, to JPMorgan
Chase Bank, N.A. at:


 


JPMorgan Chase Bank, N.A.

120 South LaSalle Street

Chicago, Illinois  60603

Attention: Patrick Fravel

Facsimile No: (312) 661-6929

E-mail: Patrick.J.Fravel@chase.com


 


(iii)          if to any other Lender,
to it at its address or facsimile number set forth in its Administrative
Questionnaire.


 


All such notices and other communications (i) sent by hand or overnight
courier service, or mailed by certified or registered mail, shall be deemed to
have been given when received or (ii) sent by facsimile shall be deemed to have
been given when sent, provided 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.


 


(b) Notices and other communications to the Administrative Agent
or Lenders hereunder may be delivered or furnished by electronic communications
(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 pursuant to Article II or to compliance and no Event of
Default certificates delivered pursuant to Section 5.01(d) unless
otherwise agreed by


 


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the Administrative Agent and the applicable
Lender.  The Administrative Agent or the
Borrower (on behalf of the Loan Parties) may, in its discretion, agree to
accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications. All such notices and other communications (i) 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 not given during the normal business
hours of the recipient, such notice or communication shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient, and (ii) 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 (b)(i) of notification that such
notice or communication is available and identifying the website address
therefor.


 


(c)           Any party hereto may
change its address or facsimile number or e-mail for notices and other
communications hereunder by notice to the other parties hereto.


 


Section 9.02           Waivers;
Amendments.  (a)  No
failure or delay by the Administrative Agent, the Issuing Bank or any Lender in
exercising any right or power hereunder or under any other Loan Document shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. 
The rights and remedies of the Administrative Agent, the Issuing Bank
and the Lenders hereunder and under any other Loan Document are cumulative and
are not exclusive of any rights or remedies that they would otherwise
have.  No waiver of any provision of any
Loan Document or consent to any departure by any Loan Party therefrom shall in
any event be effective unless the same shall be permitted by paragraph (b)
of this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given.  Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not be
construed as a waiver of any Event of Default, regardless of whether the
Administrative Agent, any Lender or the Issuing Bank may have had notice or
knowledge of such Event of Default at the time.


 


(b) Subject to clause (c) of this Section, neither this Agreement
nor any other Loan Document nor any provision hereof or thereof may be waived,
amended or modified except (i) in the case of this Agreement, pursuant to an
agreement or agreements in writing entered into by the Borrower and the
Required Lenders or, (ii) in the case of any other Loan Document, pursuant to
an agreement or agreements in writing entered into by the Administrative Agent
and the Loan Party or Loan Parties that are parties thereto, with the consent
of the Required Lenders; provided that no such agreement shall (i)
increase the Commitment of any Lender without the written consent of each
Lender directly affected thereby
(provided that the Administrative Agent may make Protective Advances as set
forth in Section 2.05), (ii) reduce or forgive the principal amount of
any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce
or forgive any interest or fees payable hereunder, without the written consent
of each Lender directly affected
thereby, (iii) postpone the maturity of any Loan, or any scheduled date of
payment of the principal amount of any Loan or LC Disbursement except, in each
case, in connection with a prepayment required by Section 2.12(b), or
any date for the payment of any


 


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interest, fees or other Obligations payable
hereunder, or reduce the amount of, waive or excuse any such payment, or
postpone the scheduled date of expiration of any Commitment, without the
written consent of each Lender directly affected
thereby, (iv) change Section 2.19(b) or (d) or Section 2.06 in a
manner that would alter the manner in which payments are shared, without the
written consent of each Lender, (v) increase the advance rates set forth in the
definition of Borrowing Base, without the written consent of each Lender, (vi)
change any of the provisions of this clause (b) or the definition of “Required
Lenders” or any other provision of any Loan Document specifying the number or
percentage of Lenders (or Lenders of any Class) required to waive, amend or
modify any rights thereunder or make any determination or grant any consent
thereunder, without the written consent of each Lender, (vii) release any Loan
Guarantor from its obligation under its Loan Guaranty (except as otherwise
permitted herein or in the other Loan Documents), without the written consent
of each Lender, or (viii) except as provided in clauses (d) and (e) of this
Section or in any Collateral Document, release all or substantially all of the
Collateral, without the written consent of each Lender; provided further
that (i) no such agreement shall amend, modify or otherwise affect the rights
or duties of the Administrative Agent, the Issuing Bank or the Swingline Lender
hereunder without the prior written consent of the Administrative Agent, the
Issuing Bank or the Swingline Lender, as the case may be and (ii) this clause
(b) shall not apply to any waiver, modification or amendment to any Loan
Document contemplated under Section 2.02(b) in connection with any
Commitment Increase.


 


(c) The Administrative Agent may (i) amend the Commitment
Schedule to reflect assignments entered into pursuant to Section 9.04,
and (ii) waive payment of the fee required under Section 9.04(b)(ii)(C).


 


(d) The Lenders hereby irrevocably authorize the Administrative
Agent, at its option and in its sole discretion, to release any Liens granted
to the Administrative Agent by the Loan Parties on any Collateral or any Loan
Guarantee executed by any Subsidiary Guarantor (i) upon the termination of
the Aggregate Commitment, payment and satisfaction in full in cash of all
Obligations (other than Unliquidated Obligations), the cash collateralization
of all LC Exposure in a manner reasonably satisfactory to each affected Issuing
Bank and the cash collateralization of all Swap Obligations constituting
Unliquidated Obligations in a manner reasonably satisfactory to each affected
holder of Swap Obligations, (ii) constituting a Subsidiary Guarantor or
property being sold, transferred or disposed of if the Loan Party disposing of
such Subsidiary Guarantor or property certifies to the Administrative Agent
that the sale or disposition is made in compliance with the terms of this
Agreement (and the Administrative Agent may rely conclusively on any such
certificate, without further inquiry), (iii) constituting property in which no
Loan Party has at any time during the term of this Agreement owned any
interest, (iv) constituting property leased to a Loan Party under a lease
which has expired or been terminated, (v) owned by or leased to any Loan Party
which is subject to a purchase money security interest or which is a Capital
Lease Obligation, in either case, permitted by Section 6.01, or (vi) as
required to effect any sale or other disposition of such Subsidiary Guarantor
or Collateral in connection with any exercise of remedies of the Administrative
Agent and the Lenders pursuant to Article VII. 
Upon request by the Administrative Agent at any time, the Lenders will
confirm in writing the Administrative Agent’s authority to release any Loan
Guaranty of any Subsidiary Guarantor or any Liens upon particular types or
items of Collateral pursuant to this Section 9.02.  Except as provided in the preceding sentence,
the Administrative Agent will not release any Loan Guarantee of any Subsidiary
Guarantor or any Liens on


 


89





















 


Collateral without the prior written
authorization of the Required Lenders; provided that, the Administrative
Agent may in its discretion, release its Liens on Collateral valued in the
aggregate not in excess of $5,000,000 during
any calendar year without the prior written authorization of the Required
Lenders.


 


(e) Upon receipt by the Administrative Agent of any authorization
required pursuant to clause (d) of this Section 9.02 from the
Required Lenders of the Administrative Agent’s authority to release any Loan
Guarantee of any Subsidiary Guarantor or any Liens upon particular types or
items of Collateral, and upon at least five Business Days prior written request
by the Loan Parties, the Administrative Agent shall (and is hereby irrevocably
authorized by the Lenders to) execute such documents and take such other action
as may be necessary, or reasonably requested by the Borrower, to evidence the
release of such Loan Guarantee or its Liens upon such Collateral, as
applicable; provided that, (i) the Administrative Agent shall not
be required to execute any such document on terms which, in the Administrative
Agent’s reasonable opinion, would expose the Administrative Agent to liability
or create any obligation or entail any consequence other than the release of
such Loan Guarantee or Liens without recourse or warranty and (ii) such
release shall not in any manner discharge, affect, or impair the Obligations or
any Loan Guarantee or Liens (other than those expressly being released) upon
(or obligations of the Loan Parties in respect of) all interests retained by
the Loan Parties, including the proceeds of any sale, all of which shall
continue to constitute part of the Collateral.


 


(f) If, in connection with any proposed amendment, waiver or
consent requiring the consent of “each Lender” (or words of similar import) or “each
Lender directly affected thereby,” (or words of similar import) the consent of
the Required Lenders is obtained, but the consent of other necessary Lenders is
not obtained (any such Lender whose consent is necessary but not obtained being
referred to herein as a “Non-Consenting Lender”), then, so long as the
Administrative Agent is not a Non-Consenting Lender, the Borrower may elect to
replace a Non-Consenting Lender as a Lender party to this Agreement, provided
that, concurrently with such replacement, (i) another bank or other entity
which is reasonably satisfactory to the Borrower and the Administrative Agent
shall agree, as of such date, to purchase for cash the Loans and other
Obligations due to the Non-Consenting Lender pursuant to an Assignment and
Assumption and to become a Lender for all purposes under this Agreement and to
assume all obligations of the Non-Consenting Lender to be terminated as of such
date and to comply with the requirements of clause (b) of Section 9.04
and (ii) the Borrower shall pay to such Non-Consenting Lender in same day funds
on the day of such replacement all interest, fees and other amounts then
accrued but unpaid to such Non-Consenting Lender by the Borrower hereunder to
and including the date of termination, including without limitation payments
due to such Non-Consenting Lender under Sections 2.16 and 2.18.


 


Section 9.03           Expenses;
Indemnity; Damage Waiver. 
(a)  The Borrower shall pay (i) all reasonable and documented
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent, in connection with the syndication and distribution
(including, without limitation, via the internet or through a service such as
Intralinks) of the credit facilities provided for herein, the preparation and
administration of the Loan Documents or any amendments, modifications or
waivers requested by the Borrower of the provisions of the Loan Documents
(whether or not the transactions contemplated hereby or thereby shall be consummated),
(ii) all


 


90





















 


reasonable and documented
out-of-pocket expenses incurred by the Issuing Bank in connection with the
issuance, amendment, renewal or extension requested by the Borrower of any
Letter of Credit or any demand for payment thereunder and (iii) during the
existence of an Event of Default, all reasonable and documented out-of-pocket
expenses incurred by the Administrative Agent, the Issuing Bank or any Lender,
including the reasonable fees, charges and disbursements of any counsel for the
Administrative Agent, any Issuing Bank or any Lender, in connection with the
enforcement, collection or protection of its rights in connection with the Loan
Documents, including its rights under this Section, and under Article X, or in
connection with the Loans made or Letters of Credit issued hereunder, including
all such reasonable and documented out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit.  Expenses being reimbursed by the
Borrower under this Section include, without limiting the generality of the
foregoing, costs and expenses incurred in connection with:


 


(i)            subject
to Section 5.10, appraisals of all or any portion of the Collateral
(including travel, lodging, meals and other out of pocket expenses of the
appraisers);


 


(ii)           subject
to Section 5.06, field examinations and the preparation of Reports based
on the fees charged by a third party retained by the Administrative Agent or
the internally allocated fees for each Person employed by the Administrative
Agent with respect to each field examination (which shall be a per day charge
of $1,000 per examiner), plus in each case travel, lodging, meals and other out
of pocket expenses;


 


(iii)          lien
and title searches and title insurance;


 


(iv)          taxes,
fees and other charges for recording the Mortgages, filing financing statements
and continuations, and other actions to perfect, protect, and continue the
Administrative Agent’s Liens;


 


(v)           sums
paid or incurred to take any action required of any Loan Party under the Loan
Documents that such Loan Party fails to pay or take; and


 


(vi)          costs
and expenses of forwarding loan proceeds, collecting checks and other items of
payment, and establishing and maintaining the accounts and lock boxes, and
costs and expenses of preserving and protecting the Collateral.


 


All of the foregoing reasonable and documented costs and expenses may
be charged to the Borrower as Revolving Loans or to another deposit account,
all in accordance with Section 2.19(c).


 


(b) The Borrower shall indemnify the Administrative Agent, the
Issuing Bank and each Lender, 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, penalties,
liabilities  and related expenses, including the reasonable fees,
charges and disbursements of counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery of the Loan Documents or any
agreement or instrument contemplated thereby, the performance by the


 


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parties hereto of their respective
obligations thereunder or the consummation of the Transactions or any other
transactions contemplated hereby, (ii) any Loan or Letter of Credit or the
use of the proceeds therefrom, (iii) any actual or alleged presence or
release of Hazardous Materials on or from any property owned or operated by the
Borrower or any of its Subsidiaries, or any Environmental Liability related in
any way to the Borrower or any of its Subsidiaries, or (iv) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory 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, penalties, liabilities or related expenses
resulted from the gross negligence or willful misconduct of such Indemnitee.


 


(c) To the extent that the Borrower fails to pay any amount
required to be paid by it to the Administrative Agent, the Issuing Bank or the
Swingline Lender under paragraph (a) or (b) of this Section, each Lender
severally agrees to pay to the Administrative Agent, the Issuing Bank or the
Swingline Lender, 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, penalty, liability or related expense, as the
case may be, was incurred by or asserted against the Administrative Agent, the
Issuing Bank or the Swingline Lender in its capacity as such.


 


(d) The relationship between any Loan Party on the one hand and
the Lenders, the Issuing Bank and the Administrative Agent on the other hand
shall be solely that of debtor and creditor. 
Neither the Administrative Agent, the Issuing Bank nor any Lender (i)
shall have any fiduciary responsibilities to any Loan Party or (ii) undertakes
any responsibility to any Loan Party to review or inform such Loan Party of any
matter in connection with any phase of any Loan Party’s business or
operations.  To the extent permitted by
applicable law, no Loan Party shall assert, and each 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 or any
agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit or the use of the proceeds thereof.


 


(e) All amounts due under this Section shall be due and payable
three (3) Business Days after written demand therefor, together with reasonably
detailed supporting documentation.


 


Section 9.04           Successors
and Assigns.  (a)  The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), except that (i) the
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section.  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 (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), Participants


 


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(to the extent provided in paragraph
(c) of this Section) and, to the extent expressly contemplated hereby, the
Related Parties of each of the Administrative Agent, the Issuing Bank and the
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.


 


(b) (i)  Subject to the
conditions set forth in paragraph (b)(ii) below, any Lender may assign to one
or more assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans at the
time owing to it) with the prior written consent (such consent not to be
unreasonably withheld) of:


 


(A)          the
Borrower, provided that no consent of the Borrower shall be required for
an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if an
Event of Default has occurred and is continuing, any other assignee; and


 


(B)           the
Administrative Agent; provided that no consent of the Administrative
Agent shall be required for an assignment to an Affiliate of a Lender; and


 


(C)           the
Issuing Bank


 


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


 


(A)          except
in the case of an assignment to a Lender, an Affiliate of a Lender or an
Approved Fund or an assignment of the entire remaining amount of the assigning
Lender’s Commitment or Loans of any Class, the amount of the Commitment or
Loans of the assigning Lender subject to each such assignment (determined as of
the date the Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent) shall not be less than $5,000,000 unless
each of the Borrower and the Administrative Agent otherwise consent, provided
that no such consent of the Borrower shall be required if an Event of Default
has occurred and is continuing;


 


(B)           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;


 


(C)           the
parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation
fee of $3,500 (which fee shall not be payable by or due and owing from any Loan
Party); and


 


(D)          the
assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an Administrative Questionnaire.


 


For the purposes of this Section 9.04(b), the term “Approved
Fund” has the following meaning:


 


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“Approved Fund” means any Person (other than a natural person)
that is engaged in making, purchasing, holding or investing in revolving bank
loans and similar extensions of credit (and has the capacity to fund revolving
loans) in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.


 


(iii)          Subject to acceptance
and recording thereof pursuant to paragraph (b)(iv) of this Section, from
and after the effective date specified in each Assignment and Assumption the
assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Assumption, have the rights and obligations of
a Lender under this Agreement, and the assigning Lender thereunder shall, to
the extent of the interest assigned by such Assignment and Assumption, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Assumption covering all of the assigning Lender’s rights and
obligations under this Agreement, such Lender shall cease to be a party hereto
but shall continue to be entitled to the benefits of Sections 2.16,
2.17, 2.18 and 9.03). 
Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this Section 9.04 shall be
treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c)
of this Section.


 


(iv)          The Administrative
Agent, acting for this purpose as an agent of the Borrower, shall maintain at
one of its offices a copy of each Assignment and Assumption delivered to it and
a register for the recordation of the names and addresses of the Lenders, and
the Commitment of, and principal amount of the Loans and LC Disbursements owing
to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent, the Issuing Bank and
the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary.  The Register shall be available for
inspection by the Borrower, the Issuing Bank and any Lender, at any reasonable
time and from time to time upon reasonable prior notice.


 


(v)           Upon its receipt of a
duly completed Assignment and Assumption executed by an assigning Lender and an
assignee, the assignee’s completed Administrative Questionnaire (unless the
assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this Section and any written consent
to such assignment required by paragraph (b) of this Section, the
Administrative Agent shall accept such Assignment and Assumption and record the
information contained therein in the Register; provided that if either the
assigning Lender or the assignee shall have failed to make any payment required
to be made by it pursuant to Section 2.06, 2.07(d) or (e),
2.08(b), 2.19(d) or 9.03(c), the Administrative Agent
shall have no obligation to accept such Assignment and Assumption and record
the information therein in the Register unless and until such payment shall
have been made in full, together with all accrued interest thereon.  No assignment shall be effective for purposes
of this Agreement unless it has been recorded in the Register as provided in
this paragraph.


 


(c) (i)  Any Lender may, without the consent of the
Borrower, the Administrative Agent, the Issuing Bank or the Swingline Lender,
sell participations to one or more banks or other entities (a “Participant”)
in all or a portion of such Lender’s rights and obligations under


 


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this Agreement (including all or a portion of
its Commitment and the Loans owing to it); provided that (A) such
Lender’s obligations under this Agreement shall remain unchanged, (B) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (C) the Borrower, the Administrative
Agent, the Issuing Bank, the Loan Parties and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement. 
Any agreement 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, modification or waiver described in the
first proviso to Section 9.02(b) that directly affects such
Participant.  Subject to paragraph
(c)(ii) of this Section, the Borrower agrees, to the extent permitted by
applicable law, that each Participant shall be entitled to the benefits of Sections
2.16, 2.17 and 2.18 to the same extent as if it were a Lender
and had acquired its interest by assignment pursuant to paragraph (b) of this
Section.


 


(ii)           A Participant shall not
be entitled to receive any greater payment under Section 2.16, 2.17
or 2.18 than the applicable Lender would have been entitled to receive
with respect to the participation sold to such Participant.  A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.18
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with Sections 2.18
and 2.20 as though it were a Lender.


 


(d) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of, or securities issued by, such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank, and this Section
shall not apply to any such pledge or assignment of a security interest; provided
that no such pledge or assignment of a security interest or the exercise by the
pledgee of its rights there under or with respect thereto shall release a
Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.


 


(e) Notwithstanding anything to the contrary contained in this
Section 9.04, no Lender may assign or sell participations, or otherwise
syndicate all or any portion of such lender’s interests under this Agreement or
any other Loan Document to any Person who is (i) listed on the Specially
Designated Nationals and Blocked Persons List (the “SDN List”) maintained by
the U.S. Department of Treasury Office of Foreign Assets Control (“OFAC”)
and/or on any other similar list maintained by the OFAC pursuant to any
authorizing statute, Executive Order or regulation (collectively, “OFAC Laws”)
or (ii) either (x) included within the term “designated national” as defined in
the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (y) designated
under Sections 1(a), 1(b), 1(c) or 1(d) of Executive Order No. 13224, 66 Fed.
Reg. 49079 (published September 25, 2001) or similarly designated under any
related enabling legislation or any other similar Executive Orders
(collectively, the “Executive Orders”).


 


Section 9.05           Survival.  All covenants, agreements, representations
and warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement or any other Loan Document shall be considered to have been
relied upon by the other parties hereto and shall survive the execution


 


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and delivery of the Loan
Documents and the making of any Loans and issuance of any Letters of Credit,
regardless of any investigation made by any such other party or on its behalf
and notwithstanding that the Administrative Agent, the Issuing Bank or any
Lender may have had notice or knowledge of any Event of Default or incorrect
representation or warranty at the time any credit is extended hereunder and shall
continue in full force and effect as long as the principal of or any accrued
interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding
(unless such Letter of Credit has been secured in accordance with Section
2.07 (j) (ii)) and so long as the Commitments have not expired or
terminated.  The provisions of Sections
2.16, 2.17, 2.18, 2.20 and 9.03 and Article
VIII shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.


 


Section 9.06           Counterparts;
Integration; Effectiveness.  This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract.  This Agreement, the other Loan Documents and
any separate letter agreements with respect to fees payable to the
Administrative Agent constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof.  Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.  Delivery of an executed
counterpart of a signature page of this Agreement by facsimile shall be
effective as delivery of a manually executed counterpart of this Agreement.


 


Section 9.07           Severability.  Any provision of any Loan Document held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions thereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.


 


Section 9.08           Right
of Setoff.  If an Event of Default
shall have occurred and be continuing, each Lender and each of its Affiliates
(with the prior consent of the Administrative Agent) is hereby authorized at
any time and from time to time, with reasonably prompt subsequent notice to the
Borrower, to the fullest extent permitted by law, to set off and apply in accordance
with Section 2.19 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 or Affiliate to or for the credit or the account of
any Loan Party against any of and all the Obligations held by such Lender,
irrespective of whether or not such Lender shall have made any demand under the
Loan Documents and although such obligations may be unmatured.  The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.


 


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Section 9.09           Governing
Law; Jurisdiction; Consent to Service of Process.  (a) 
The Loan Documents (other than those containing a contrary express
choice of law provision) shall be governed by and construed in accordance with
the laws of the State of Illinois.


 


(b) Each Loan Party hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of any
U.S. Federal or Illinois State court sitting in Chicago, Illinois in any action
or proceeding arising out of or relating to any Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such Illinois State or, to
the extent permitted by law, in such Federal court.  Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.  Nothing in this
Agreement or any other Loan Document shall affect any right that the
Administrative Agent, the Issuing Bank or any Lender may otherwise have to
bring any action or proceeding relating to this Agreement or any other Loan
Document against any Loan Party or its properties in the courts of any
jurisdiction.


 


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


 


(d) Each party to this Agreement irrevocably consents, to the
extent permitted by applicable law, to service of process in the manner
provided for notices in Section 9.01.  Nothing in this Agreement or any other Loan
Document will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.


 


Section 9.10           WAIVER
OF JURY TRIAL.  EACH PARTY HERETO
HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT
MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR
ANY OTHER THEORY).  EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN
THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.


 


Section 9.11           Headings.  Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.


 


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Section 9.12           Confidentiality.  Each of the Administrative Agent, the Issuing
Bank and the Lenders agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its
and its Affiliates’ directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and will agree to keep such Information confidential
in accordance with this Section), (b) to the extent requested by any
regulatory authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process (provided that in the
case of Information required to be disclosed by a Person pursuant to a subpoena
or similar legal process, such Person shall use reasonable efforts to provide
the Borrower with prior notice of such required disclosure and the opportunity
to obtain a protective order in respect thereof if no conflict exists with such
Person’s governmental, regulatory or legal requirements), (d) to any other
party to this Agreement, (e) in connection with the exercise of any remedies
hereunder or any suit, action or proceeding relating to this Agreement or any
other Loan Document or the enforcement of rights hereunder or thereunder, (f)
subject to an agreement containing provisions substantially the same as those
of this Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement or (ii) any actual or prospective counterparty (or its advisors) to
any swap or derivative transaction relating to the Loan Parties and their
obligations, (g) with the consent of the Borrower or (h) 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, the Issuing Bank or any Lender on a nonconfidential basis from a source
other than any Loan Party.  For the
purposes of this Section, “Information” means all information received
from any Loan Party relating to any Loan Party or its business, other than any
such information that is available to the Administrative Agent, the Issuing
Bank or any Lender on a nonconfidential basis prior to disclosure by such Loan
Party from a source other than a Loan Party. 
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.


 


Section 9.13           Several
Obligations; Nonreliance; Violation of Law. 
The respective obligations of the Lenders hereunder are several and not
joint and the failure of any Lender to make any Loan or perform any of its
obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. Each Lender hereby represents that it is not relying on
or looking to any margin stock for the repayment of the Borrowings provided for
herein.  Anything contained in this
Agreement to the contrary notwithstanding, neither the Issuing Bank nor any
Lender shall be obligated to extend credit to the Borrower in violation of any
limitation or prohibition provided by any applicable statute or regulation.


 


Section 9.14           USA
PATRIOT Act.  Each Lender that is
subject to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”) hereby notifies the Borrower
that pursuant to the requirements of the Act, it is required to obtain, verify
and record information that identifies the Borrower, which information includes
the name and address of the Borrower and other information that will allow such
Lender to identify the Borrower in accordance with the Act.


 


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Section 9.15           Disclosure.  Each Loan Party and each Lender hereby
acknowledges and agrees that the Administrative Agent and/or its Affiliates
from time to time may hold investments in, make other loans to or have other
relationships with any of the Loan Parties and their respective Affiliates.


 


Section 9.16           Execution
of Loan Documents.  The Lenders
hereby empower and authorize the Administrative Agent, on behalf of the
Lenders, to execute and deliver to the Loan Parties the other Loan Documents
and all related agreements, certificates, documents, or instruments as shall be
necessary or appropriate to effect the purposes of the Loan Documents.  Each Lender agrees that any action taken by
the Administrative Agent or the Required Lenders in accordance with the terms
of this Agreement or the other Loan Documents, and the exercise by the
Administrative Agent or the Required Lenders of their respective powers set
forth therein or herein, together with such other powers that are reasonably
incidental thereto, shall be binding upon all of the Lenders.  The Lenders acknowledge that all of the
Obligations hereunder constitute one debt, secured pari passu by all of the
Collateral.


 


Section 9.17           Interest
Rate Limitation.  Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan, together with all fees, charges and other amounts which are treated
as interest on such Loan under applicable law (collectively the “Charges”),
shall exceed the maximum lawful rate (the “Maximum Rate”) which may be
contracted for, charged, taken, received or reserved by the Lender holding such
Loan in accordance with applicable law, the rate of interest payable in respect
of such Loan hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest
and Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section shall be cumulated and the
interest and Charges payable to such Lender in respect of other Loans or
periods shall be increased (but not above the Maximum Rate therefore) until
such cumulated amount, together with interest thereon at the Federal Funds
Effective Rate to the date of repayment, shall have been received by such
Lender.


 


ARTICLE X.


 


LOAN GUARANTY


 


Section 10.01         Guaranty.  Each Loan Guarantor hereby agrees that it is
jointly and severally liable for, and, as primary obligor and not merely as
surety, except as otherwise provided for herein, absolutely and unconditionally
guarantees to the Administrative Agent, for the benefit of the Lenders, the
prompt payment when due, whether at stated maturity, upon acceleration or
otherwise, and at all times thereafter, of the Obligations and, to the extent
reimbursable under Section 9.03(a), all reasonable and documented costs
and expenses including, without limitation, all court costs and attorneys’ and
paralegals’ fees and expenses paid or incurred by the Administrative Agent, the
Issuing Bank and the Lenders in endeavoring to collect all or any part of the
Obligations from, or in prosecuting any action against, the Borrower or any
Loan Guarantor (such costs and expenses, together with the Obligations,
collectively the “Guaranteed Obligations”).  Each Loan Guarantor further agrees that the
Guaranteed Obligations may be extended or renewed in whole or in part without
notice to or further assent from it, and that it remains bound upon its
guarantee notwithstanding any such


 


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extension or renewal. All terms
of this Loan Guaranty apply to any domestic or foreign branch or Affiliate of
any Lender that extended any portion of the Guaranteed Obligations.


 


Section 10.02         Guaranty
of Payment.  This Loan Guaranty is a
guaranty of payment and not of collection. Each Loan Guarantor waives any right
to require the Administrative Agent, the Issuing Bank or any Lender to sue the
Borrower, any Loan Guarantor, any other guarantor, or any other person
obligated for all or any part of the Guaranteed Obligations (each, an “Obligated
Party”), or otherwise to enforce its payment against any collateral
securing all or any part of the Guaranteed Obligations.


 


Section 10.03         No
Discharge or Diminishment of Loan Guaranty. 
(a)  Except as otherwise provided for herein, to the extent
permitted by applicable law, the obligations of each Loan Guarantor hereunder
are unconditional and absolute and not subject to any reduction, limitation,
impairment or termination for any reason (other than the payment in full in
cash of the Guaranteed Obligations), including: 
(i) any claim of waiver, release, extension, renewal, settlement,
surrender, alteration, or compromise of any of the Guaranteed Obligations, by
operation of law or otherwise; (ii) any change in the corporate existence,
structure or ownership of the Borrower or any other guarantor of or other
person liable for any of the Guaranteed Obligations; (iii) any insolvency,
bankruptcy, reorganization or other similar proceeding affecting any Obligated
Party, or their assets or any resulting release or discharge of any obligation
of any Obligated Party; or (iv) the existence of any claim, setoff or other
rights which any Loan Guarantor may have at any time against any Obligated
Party, the Administrative Agent, the Issuing Bank, any Lender, or any other
person, whether in connection herewith or in any unrelated transactions.


 


(b) To the extent permitted by applicable law, the obligations of
each Loan Guarantor hereunder are not subject to any defense (other than
payment in full of the Guaranteed Obligations) or setoff, counterclaim,
recoupment, or termination whatsoever by reason of the invalidity, illegality,
or unenforceability of any of the Guaranteed Obligations or otherwise, or any
provision of applicable law or regulation purporting to prohibit payment by any
Obligated Party, of the Guaranteed Obligations or any part thereof.


 


(c) Further, to the extent permitted by applicable law, the
obligations of any Loan Guarantor hereunder are not discharged or impaired or
otherwise affected by: (i) the failure of the Administrative Agent, the Issuing
Bank or any Lender to assert any claim or demand or to enforce any remedy with
respect to all or any part of the Guaranteed Obligations; (ii) any waiver or
modification of or supplement to any provision of any agreement relating to the
Guaranteed Obligations; (iii) any release, non-perfection, or invalidity of any
indirect or direct security for the obligations of the Borrower for all or any
part of the Guaranteed Obligations or any obligations of any other guarantor of
or other person liable for any of the Guaranteed Obligations; (iv) any action
or failure to act by the Administrative Agent, the Issuing Bank or any Lender
with respect to any collateral securing any part of the Guaranteed Obligations;
or (v) any default, failure or delay, willful or otherwise, in the payment or
performance of any of the Guaranteed Obligations, or any other circumstance,
act, omission or delay that might in any manner or to any extent vary the risk
of such Loan Guarantor or that would otherwise operate as a discharge of any
Loan Guarantor as a matter of law or equity (other than, in each case, the
payment in full in cash of the Guaranteed Obligations).


 


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Section 10.04         Defenses
Waived.  To the fullest extent
permitted by applicable law, each Loan Guarantor hereby waives any defense
based on or arising out of any defense of the Borrower or any Loan Guarantor or
the unenforceability of all or any part of the Guaranteed Obligations from any
cause, or the cessation from any cause of the liability of the Borrower or any
Loan Guarantor, other than the payment in full in cash of the Guaranteed
Obligations. Without limiting the generality of the foregoing, each Loan
Guarantor irrevocably waives acceptance hereof, presentment, demand, protest
and, to the fullest extent permitted by law, any notice not provided for
herein, as well as any requirement that at any time any action be taken by any
person against any Obligated Party, or any other person.  To the extent permitted by applicable law,
the Administrative Agent may, at its election, in accordance with the Loan
Documents, foreclose on any Collateral held by it by one or more judicial or
nonjudicial sales, accept an assignment of any such Collateral in lieu of
foreclosure or otherwise act or fail to act with respect to any collateral
securing all or a part of the Guaranteed Obligations, compromise or adjust any
part of the Guaranteed Obligations, make any other accommodation with any
Obligated Party or exercise any other right or remedy available to it against
any Obligated Party, without affecting or impairing in any way the liability of
such Loan Guarantor under this Loan Guaranty except to the extent the
Guaranteed Obligations have been fully and paid in cash.  To the fullest extent permitted by applicable
law, each Loan Guarantor waives any defense arising out of any such election
even though that election may operate, pursuant to applicable law, to impair or
extinguish any right of reimbursement or subrogation or other right or remedy
of any Loan Guarantor against any Obligated Party or any security.


 


Section 10.05         Rights of
Subrogation.  No Loan Guarantor will
assert any right, claim or cause of action (including, without limitation, a
claim of subrogation, contribution or indemnification) that it has against any
Obligated Party, or any collateral, until the Loan Parties and the Loan
Guarantors have fully performed all their obligations to the Administrative
Agent, the Issuing Bank and the Lenders.


 


Section 10.06         Reinstatement;
Stay of Acceleration.  If at any time
any payment of any portion of the Guaranteed Obligations is rescinded or must
otherwise be restored or returned upon the insolvency, bankruptcy, or
reorganization of the Borrower or otherwise, each Loan Guarantor’s obligations
under this Loan Guaranty with respect to that payment shall be reinstated at
such time as though the payment had not been made and whether or not the
Administrative Agent, the Issuing Bank and the Lenders are in possession of
this Loan Guaranty. If acceleration of the time for payment of any of the
Guaranteed Obligations is stayed upon the insolvency, bankruptcy or
reorganization of the Borrower, all such amounts otherwise subject to
acceleration under the terms of any agreement relating to the Guaranteed
Obligations shall nonetheless be payable by the Loan Guarantors forthwith on
demand by the Lender.


 


Section 10.07         Information.  Each Loan Guarantor assumes all
responsibility for being and keeping itself informed of the Borrower’s
financial condition and assets, and of all other circumstances bearing upon the
risk of nonpayment of the Guaranteed Obligations and the nature, scope and
extent of the risks that each Loan Guarantor assumes and incurs under this Loan
Guaranty, and agrees that neither the Administrative Agent, the Issuing Bank
nor any Lender shall have any duty to advise any Loan Guarantor of information
known to it regarding those circumstances or risks.


 


101





















 


Section 10.08         Termination.  The Lenders may continue to make loans or
extend credit to the Borrower based on this Loan Guaranty until five days after
it receives written notice of termination from any Loan Guarantor.  Notwithstanding receipt of any such notice,
each Loan Guarantor will continue to be liable to the Lenders for any
Guaranteed Obligations created, assumed or committed to prior to the fifth day
after receipt of the notice.


 


Section 10.09         [Intentionally
Omitted].


 


Section 10.10         Maximum
Liability.  The provisions of this
Loan Guaranty are severable, and in any action or proceeding involving any
state corporate law, or any state, federal or foreign bankruptcy, insolvency,
reorganization or other law affecting the rights of creditors generally, if the
obligations of any Loan Guarantor under this Loan Guaranty would otherwise be
held or determined to be avoidable, invalid or unenforceable on account of the
amount of such Loan Guarantor’s liability under this Loan Guaranty, then,
notwithstanding any other provision of this Loan Guaranty to the contrary, the
amount of such liability shall, without any further action by the Loan
Guarantors or the Lenders, be automatically limited and reduced to the highest
amount that is valid and enforceable as determined in such action or proceeding
(such highest amount determined hereunder being the relevant Loan Guarantor’s “Maximum
Liability”.  This Section with
respect to the Maximum Liability of each Loan Guarantor is intended solely to
preserve the rights of the Lenders to the maximum extent not subject to
avoidance under applicable law, and no Loan Guarantor nor any other person or
entity shall have any right or claim under this Section with respect to such
Maximum Liability, except to the extent necessary so that the obligations of
any Loan Guarantor hereunder shall not be rendered voidable under applicable
law. Each Loan Guarantor agrees that the Guaranteed Obligations may at any time
and from time to time exceed the Maximum Liability of each Loan Guarantor
without impairing this Loan Guaranty or affecting the rights and remedies of
the Lenders hereunder, provided that, nothing in this sentence shall be
construed to increase any Loan Guarantor’s obligations hereunder beyond its
Maximum Liability.


 


Section 10.11         Contribution.  In the event any Loan Guarantor (a “Paying
Guarantor”) shall make any payment or payments under this Loan Guaranty or
shall suffer any loss as a result of any realization upon any collateral
granted by it to secure its obligations under this Loan Guaranty, each other
Loan Guarantor (each a “Non-Paying Guarantor”) shall contribute to such
Paying Guarantor an amount equal to such Non-Paying Guarantor’s “Applicable
Percentage” of such payment or payments made, or losses suffered, by such
Paying Guarantor.  For purposes of this
Article X, each Non-Paying Guarantor’s “Applicable Percentage” with
respect to any such payment or loss by a Paying Guarantor shall be determined
as of the date on which such payment or loss was made by reference to the ratio
of (i) such Non-Paying Guarantor’s Maximum Liability as of such date (without
giving effect to any right to receive, or obligation to make, any contribution
hereunder) or, if such Non-Paying Guarantor’s Maximum Liability has not been
determined, the aggregate amount of all monies received by such Non-Paying
Guarantor from the Borrower after the date hereof (whether by loan, capital
infusion or by other means) to (ii) the aggregate Maximum Liability of all Loan
Guarantors hereunder (including such Paying Guarantor) as of such date (without
giving effect to any right to receive, or obligation to make, any contribution
hereunder), or to the extent that a Maximum Liability has not been determined
for any Loan Guarantor, the aggregate amount of all monies received by such
Loan Guarantors from the Borrower after the date hereof (whether by loan,
capital infusion or by other means).


 


102





















 


Nothing in this provision shall
affect any Loan Guarantor’s several liability for the entire amount of the
Guaranteed Obligations (up to such Loan Guarantor’s Maximum Liability).  Each of the Loan Guarantors covenants and
agrees that its right to receive any contribution under this Loan Guaranty from
a Non-Paying Guarantor shall be subordinate and junior in right of payment to
the payment in full in cash of the Guaranteed Obligations.  This provision is for the benefit of both the
Administrative Agent, the Issuing Banks, the Lenders and the Loan Guarantors
and may be enforced by any one, or more, or all of them in accordance with the
terms hereof.


 


Section 10.12         Liability
Cumulative.  The liability of each
Loan Party as a Loan Guarantor under this Article X is in addition to and shall
be cumulative with all liabilities of each Loan Party to the Administrative
Agent, the Issuing Bank and the Lenders under this Agreement and the other Loan
Documents to which such Loan Party is a party or in respect of any obligations
or liabilities of the other Loan Parties, without any limitation as to amount,
unless the instrument or agreement evidencing or creating such other liability
specifically provides to the contrary.


 


103





















 


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


 


	
   

  	
  CF
  INDUSTRIES, INC., as the Borrower

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Dennis W. Baker

  	
   

  
	
   

  	
  Name:

  	
  Dennis Baker

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Treasurer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  CF
  INDUSTRIES HOLDINGS, INC., as a Loan

  Guarantor

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Dennis W. Baker

  	
   

  
	
   

  	
  Name:

  	
  Dennis Baker

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Treasurer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MATLOK
  FERTILIZER COMPANY, INC., as a

  Loan Guarantor

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Dennis W. Baker

  	
   

  
	
   

  	
  Name:

  	
  Dennis Baker

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Treasurer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PHOSACID
  SERVICE & SUPPLY, INC., as a

  Loan Guarantor

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Dennis W. Baker

  	
   

  
	
   

  	
  Name:

  	
  Dennis Baker

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Treasurer

  	
   

  
									



 


S-1





















 


	
   

  	
  JPMORGAN
  CHASE BANK, N.A., individually,

  as Administrative Agent, Issuing Bank, Lender and

  Swingline Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Patrick Fravel

  	
   

  
	
   

  	
  Name:

  	
  Patrick Fravel

  	
   

  
	
   

  	
  Title:

  	
   

  	
  VP

  	
   

  
						



 


S-2





















 


	
   

  	
  BANK OF
  AMERICA, N.A., as Co-Documentation

  Agent and as a Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Dan Petrik

  	
   

  
	
   

  	
  Name:

  	
  Dan Petrik

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Senior Vice President

  	
   

  
						



 


S-3





















 


	
   

  	
  CITICORP
  USA, INC., as Co-Documentation

  Agent and as a Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ James N. Simpson

  	
   

  
	
   

  	
  Name:

  	
  James N. Simpson

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Vice President Citicorp USA Inc.

  	
   

  
						



 


S-4





















 


	
   

  	
  COBANK, ACB,
  as a Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ S. Richard Dill

  	
   

  
	
   

  	
  Name:

  	
  S. Richard Dill

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Vice President

  	
   

  
						



 


S-5





















 


	
   

  	
  GENERAL
  ELECTRIC CAPITAL

  CORPORATION, as a Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Dennis W. Cloud

  	
   

  
	
   

  	
  Name:

  	
  Dennis W. Cloud

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Duly Authorized Signatory

  	
   

  
						



 


S-6





















 


	
   

  	
  HARRIS N.A.,
  as Co-Syndication Agent and as a

  Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Corey Noland

  	
   

  
	
   

  	
  Name:

  	
  Corey Noland

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Vice President

  	
   

  
						



 


S-7





















 


	
   

  	
  LASALLE BANK
  NATIONAL ASSOCIATION,

  as a Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Sarah E. Gin

  	
   

  
	
   

  	
  Name:

  	
  Sarah E. Gin

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Vice President

  	
   

  
						



 


S-8





















 


	
   

  	
  NATEXIS
  BANQUES POPULAIRES, as a Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Vincent Lauras

  	
  /s/ Alisa Trani

  	
   

  
	
   

  	
  Name:

  	
  Vincent Lauras

  	
  Alisa Trani

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Managing Director

  	
  Assistant Vice

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  President

  	
   

  
							



 


S-9





















 


	
   

  	
  RZB FINANCE
  LLC, as a Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ John A. Valiska

  	
   

  
	
   

  	
  Name:

  	
  John A. Valiska

  	
   

  
	
   

  	
  Title:

  	
   

  	
  First Vice President

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Juan M. Csillagi

  	
   

  
	
   

  	
  Name:

  	
  Juan M. Csillagi

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Group Vice President

  	
   

  
							



 


S-10





















 


	
   

  	
  WELLS FARGO
  BANK, N.A., as a Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Edward L. Cooper III

  	
   

  
	
   

  	
  Name:

  	
  Edward L. Cooper III

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Senior Vice President

  	
   

  
						



 


S-11





















 


COMMITMENT SCHEDULE


 




	
  Lender

  	
   

  	
  Revolving

  Commitment

  	
   

  
	
  JPMorgan Chase Bank, N.A.

  	
   

  	
  $

  	
  45,000,000

  	
   

  
	
  Harris N.A.

  	
   

  	
  $

  	
  35,000,000

  	
   

  
	
  General Electric Capital Corporation

  	
   

  	
  $

  	
  35,000,000

  	
   

  
	
  Citicorp USA, Inc.

  	
   

  	
  $

  	
  30,000,000

  	
   

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  27,000,000

  	
   

  
	
  LaSalle Bank National Association

  	
   

  	
  $

  	
  17,000,000

  	
   

  
	
  CoBank, ACB

  	
   

  	
  $

  	
  17,000,000

  	
   

  
	
  Wells Fargo Bank, N.A.

  	
   

  	
  $

  	
  17,000,000

  	
   

  
	
  Natexis Banques Populaires

  	
   

  	
  $

  	
  17,000,000

  	
   

  
	
  RZB Finance LLC

  	
   

  	
  $

  	
  10,000,000

  	
   

  
	
  Total

  	
   

  	
  $

  	
  250,000,000