exv10w1






Exhibit 10.1




THIRD AMENDED AND RESTATED REVOLVING LOAN AGREEMENT




Dated as of October 31, 2008




among




VIASAT, INC.




THE LENDERS HEREIN NAMED




UNION BANK OF CALIFORNIA, N.A.,

as Sole Lead Arranger and Administrative Agent




UNION BANK OF CALIFORNIA, N.A.,

as Collateral Agent




JPMORGAN CHASE BANK, N.A.,

as Syndication Agent




and




BANK OF AMERICA, N.A.,

as Documentation Agent




 









 





TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	ARTICLE 1 DEFINITIONS AND ACCOUNTING TERMS	 	 	1	 
	 
	 	 	 	 	 	 
	1.1
	 	Defined Terms	 	 	1	 
	1.2
	 	Use of Defined Terms	 	 	22	 
	1.3
	 	Accounting Terms	 	 	22	 
	1.4
	 	Rounding	 	 	22	 
	1.5
	 	Exhibits and Schedules	 	 	23	 
	1.6
	 	References to “Borrower and its Subsidiaries”	 	 	23	 
	1.7
	 	Miscellaneous Terms	 	 	23	 
	 
	 	 	 	 	 	 
	ARTICLE 2 LOANS AND LETTERS OF CREDIT	 	 	24	 
	 
	 	 	 	 	 	 
	2.1
	 	Loans — General	 	 	24	 
	2.2
	 	Alternate Base Rate Loans	 	 	25	 
	2.3
	 	Eurodollar Rate Loans	 	 	25	 
	2.4
	 	Letters of Credit	 	 	25	 
	2.5
	 	Voluntary Reduction of Commitment	 	 	29	 
	2.6
	 	Administrative Agent’s Right to Assume Funds Available for Advances	 	 	29	 
	2.7
	 	Collateral	 	 	30	 
	2.8
	 	Increase of Commitment	 	 	30	 
	 
	 	 	 	 	 	 
	ARTICLE 3 PAYMENTS AND FEES	 	 	32	 
	 
	 	 	 	 	 	 
	3.1
	 	Principal and Interest	 	 	32	 
	3.2
	 	Closing Date Fees	 	 	33	 
	3.3
	 	Commitment Fee	 	 	33	 
	3.4
	 	Letter of Credit Fees	 	 	33	 
	3.5
	 	Increased Commitment Costs	 	 	34	 
	3.6
	 	Eurodollar Costs and Related Matters	 	 	34	 
	3.7
	 	Late Payments	 	 	38	 
	3.8
	 	Computation of Interest and Fees	 	 	38	 
	3.9
	 	Non-Banking Days	 	 	38	 
	3.10
	 	Manner and Treatment of Payments	 	 	38	 
	3.11
	 	Funding Sources	 	 	40	 
	3.12
	 	Failure to Charge Not Subsequent Waiver	 	 	40	 
	3.13
	 	Administrative Agent’s Right to Assume Payments Will be Made	 	 	40	 
	3.14
	 	Fee Determination Detail	 	 	40	 
	3.15
	 	Survivability	 	 	40	 
	 
	 	 	 	 	 	 
	ARTICLE 4 REPRESENTATIONS AND WARRANTIES	 	 	41	 
	 
	 	 	 	 	 	 
	4.1
	 	Existence and Qualification; Power; Compliance With Laws	 	 	41	 
	4.2
	 	Authority; Compliance With Other Agreements and Instruments and Government Regulations	 	 	41	 
	4.3
	 	No Governmental Approvals Required	 	 	42	 
	4.4
	 	Subsidiaries	 	 	42	 






i









 






TABLE OF CONTENTS

(continued)




	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	4.5
	 	Financial Statements	 	 	42	 
	4.6
	 	No Other Liabilities; No Material Adverse Changes	 	 	43	 
	4.7
	 	Intentionally Deleted	 	 	43	 
	4.8
	 	Intangible Assets	 	 	43	 
	4.9
	 	Intentionally Deleted	 	 	43	 
	4.10
	 	Litigation	 	 	43	 
	4.11
	 	Binding Obligations	 	 	43	 
	4.12
	 	No Default	 	 	44	 
	4.13
	 	ERISA	 	 	44	 
	4.14
	 	Regulation U; Investment Company Act	 	 	44	 
	4.15
	 	Disclosure	 	 	44	 
	4.16
	 	Tax Liability	 	 	44	 
	4.17
	 	Projections	 	 	45	 
	4.18
	 	Hazardous Materials	 	 	45	 
	4.19
	 	Security Interests	 	 	45	 
	4.20
	 	Solvency	 	 	45	 
	4.21
	 	OFAC	 	 	45	 
	4.22
	 	Patriot Act	 	 	46	 
	 
	 	 	 	 	 	 
	ARTICLE 5 AFFIRMATIVE COVENANTS	 	 	47	 
	 
	 	 	 	 	 	 
	5.1
	 	Payment of Taxes and Other Potential Liens	 	 	47	 
	5.2
	 	Preservation of Existence	 	 	47	 
	5.3
	 	Maintenance of Properties	 	 	47	 
	5.4
	 	Maintenance of Insurance	 	 	47	 
	5.5
	 	Compliance With Laws	 	 	48	 
	5.6
	 	Inspection Rights	 	 	48	 
	5.7
	 	Keeping of Records and Books of Account	 	 	48	 
	5.8
	 	Compliance With Agreements	 	 	48	 
	5.9
	 	Use of Proceeds	 	 	48	 
	5.10
	 	Hazardous Materials Laws	 	 	48	 
	5.11
	 	Syndication Process	 	 	49	 
	5.12
	 	Future Subsidiaries; Additional Security Documentation	 	 	49	 
	 
	 	 	 	 	 	 
	ARTICLE 6 NEGATIVE COVENANTS	 	 	50	 
	 
	6.1
	 	Payment of Subordinated Obligations	 	 	50	 
	6.2
	 	Disposition of Property	 	 	50	 
	6.3
	 	Mergers	 	 	50	 
	6.4
	 	Hostile Acquisitions	 	 	50	 
	6.5
	 	Acquisitions	 	 	51	 
	6.6
	 	Distributions	 	 	51	 
	6.7
	 	ERISA	 	 	51	 
	6.8
	 	Change in Nature of Business	 	 	51	 
	6.9
	 	Liens	 	 	51	 






ii









 






TABLE OF CONTENTS

(continued)




	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	6.10
	 	Indebtedness and Guaranty Obligations	 	 	52	 
	6.11
	 	Transactions with Affiliates	 	 	53	 
	6.12
	 	Negative Pledges	 	 	53	 
	6.13
	 	Leverage Ratio	 	 	53	 
	6.14
	 	Interest Coverage Ratio	 	 	53	 
	6.15
	 	Intentionally Omitted	 	 	53	 
	6.16
	 	Investments	 	 	53	 
	6.17
	 	Capital Expenditures	 	 	54	 
	6.18
	 	Amendments to Subordinated Obligations	 	 	54	 
	6.19
	 	Changes in Officers, Name, Location of Chief Executive Offices, Etc	 	 	55	 
	 
	 	 	 	 	 	 
	ARTICLE 7 INFORMATION AND REPORTING REQUIREMENTS	 	 	56	 
	 
	 	 	 	 	 	 
	7.1
	 	Financial and Business Information	 	 	56	 
	7.2
	 	Intentionally Omitted	 	 	58	 
	7.3
	 	Compliance Certificates	 	 	58	 
	7.4
	 	IntraLinks/IntraAgency	 	 	58	 
	 
	 	 	 	 	 	 
	ARTICLE 8 CONDITIONS	 	 	59	 
	 
	 	 	 	 	 	 
	8.1
	 	Initial Credit Issuance	 	 	59	 
	8.2
	 	Any Advance	 	 	60	 
	 
	 	 	 	 	 	 
	ARTICLE 9 EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT	 	 	62	 
	 
	 	 	 	 	 	 
	9.1
	 	Events of Default	 	 	62	 
	9.2
	 	Remedies Upon Event of Default	 	 	64	 
	 
	 	 	 	 	 	 
	ARTICLE 10 THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT	 	 	66	 
	 
	10.1
	 	Appointment and Authorization	 	 	66	 
	10.2
	 	The Agents and Their Affiliates	 	 	66	 
	10.3
	 	Proportionate Interest in any Collateral	 	 	66	 
	10.4
	 	Lenders’ Credit Decisions	 	 	67	 
	10.5
	 	Action by Administrative Agent and Collateral Agent	 	 	67	 
	10.6
	 	Liability of Agents	 	 	68	 
	10.7
	 	Indemnification	 	 	69	 
	10.8
	 	Successor Agents	 	 	69	 
	10.9
	 	No Obligations of Borrower	 	 	70	 
	 
	 	 	 	 	 	 
	ARTICLE 11 MISCELLANEOUS	 	 	71	 
	 
	 	 	 	 	 	 
	11.1
	 	Cumulative Remedies: No Waiver	 	 	71	 
	11.2
	 	Amendments; Consents	 	 	71	 
	11.3
	 	Costs, Expenses and Taxes	 	 	72	 






iii









 






TABLE OF CONTENTS

(continued)




	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	11.4
	 	Nature of Lenders’ Obligations	 	 	73	 
	11.5
	 	Survival of Representations and Warranties	 	 	73	 
	11.6
	 	Notices	 	 	73	 
	11.7
	 	Execution of Loan Documents	 	 	74	 
	11.8
	 	Binding Effect; Assignment	 	 	74	 
	11.9
	 	Right of Setoff	 	 	76	 
	11.10
	 	Sharing of Setoffs	 	 	76	 
	11.11
	 	Indemnity by Borrower	 	 	77	 
	11.12
	 	Nonliability of the Lenders	 	 	78	 
	11.13
	 	No Third Parties Benefited	 	 	79	 
	11.14
	 	Confidentiality	 	 	79	 
	11.15
	 	Further Assurances	 	 	80	 
	11.16
	 	Integration	 	 	80	 
	11.17
	 	GOVERNING LAW; VENUE	 	 	80	 
	11.18
	 	Severability of Provisions	 	 	81	 
	11.19
	 	Headings	 	 	81	 
	11.20
	 	Time of the Essence	 	 	81	 
	11.21
	 	Foreign Lenders and Participants	 	 	81	 
	11.22
	 	Hazardous Material Indemnity	 	 	82	 
	11.23
	 	DISPUTES	 	 	82	 
	11.24
	 	Purported Oral Amendments	 	 	83	 
	11.25
	 	Patriot Act	 	 	83	 
	11.26
	 	Effect of Amendment and Restatement	 	 	83	 






iv









 





THIRD AMENDED AND RESTATED REVOLVING LOAN AGREEMENT




Dated as of October 31, 2008




     THIS THIRD AMENDED AND RESTATED REVOLVING LOAN AGREEMENT (this “Agreement”) is entered into by
and among ViaSat, Inc., a Delaware corporation (“Borrower”), each lender whose name is set forth on
the signature pages of this Agreement and each lender which may hereafter become a party to this
Agreement pursuant to Section 2.8 and/or Section 11.8 (collectively, the “Lenders”
and individually, a “Lender”), Union Bank of California, N.A., as Administrative Agent, and UNION
BANK OF CALIFORNIA, N.A., as Collateral Agent, with reference to the following facts:



RECITALS




     A. Borrower, Union Bank, Comerica Bank and Wachovia Bank, N.A. (collectively, the “Existing
Lenders”), as lenders, Union Bank, as administrative agent, and Comerica Bank, as collateral agent,
are parties to that certain Second Amended and Restated Revolving Loan Agreement dated as of
January 31, 2005, as amended (collectively, the “Existing Loan Agreement”), pursuant to which the
Existing Lenders provided Borrower with various credit facilities.



     B. Borrower, the Lenders, the Administrative Agent and the Collateral Agent wish to enter into
this Agreement, which shall amend, restate, replace and supersede (but shall not constitute a
novation of) the Existing Loan Agreement and which hereinafter shall govern the credit facilities
provided to Borrower by Union Bank and the other Lenders which now or hereafter are parties to this
Agreement.



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



Article 1

DEFINITIONS AND ACCOUNTING TERMS




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



     “Acquisition” means any transaction, or any series of related transactions,
consummated after the Closing Date, by which Borrower and/or any of its Subsidiaries directly or
indirectly (a) acquires any ongoing business or all or substantially all of the assets of any
Person engaged in any ongoing business, whether through a purchase of assets, a merger or
otherwise, (b) acquires control of securities of a Person engaged in an ongoing business
representing more than 50% of the ordinary voting power for the election of directors or other
governing position if the business affairs of such Person are managed by a board of directors or
other governing body or (c) acquires control of more than 50% of the ownership interest in any
partnership, joint venture, limited liability company, business trust or other Person engaged in an
ongoing business that is not managed by a board of directors or other governing body.



1









 





     “Administrative Agent” means Union Bank of California, N.A. when acting in its
capacity as the Administrative Agent under any of the Loan Documents, or any successor
Administrative Agent.



     “Administrative Agent’s Office” means the Administrative Agent’s address as set forth
on the signature pages of this Agreement, or such other address as the Administrative Agent
hereafter may designate by written notice to Borrower and the Lenders.



     “Advance” means any advance made or to be made by any Lender to Borrower as provided
in Article 2, and includes each Alternate Base Rate Advance and Eurodollar Rate
Advance.



     “Affiliate” means, as to any Person, any other Person which directly or indirectly
controls, or is under common control with, or is controlled by, such Person. As used in this
definition, “control” (and the correlative terms, “controlled by” and “under common control with”)
shall mean possession, directly or indirectly, of power to direct or cause the direction of
management or policies (whether through ownership of securities or partnership or other ownership
interests, by contract or otherwise); provided that, in any event, any Person that owns, directly
or indirectly, 10% or more of the securities having ordinary voting power for the election of
directors or other governing body of a corporation that has more than 100 record holders of such
securities, or 10% or more of the partnership or other ownership interests of any other Person that
has more than 100 record holders of such interests, will be deemed to be an Affiliate of such
corporation, partnership or other Person.



     “Agreement” means this Third Amended and Restated Revolving Loan Agreement, either as
originally executed or as it may from time to time be supplemented, modified, amended, restated or
extended.



     “Aggregate Effective Amount” means, as of any date of determination and with respect
to all Letters of Credit then outstanding, the sum of (a) the aggregate effective face
amounts of all such Letters of Credit not then paid by the Issuing Lender plus (b) the
aggregate amounts paid by the Issuing Lender under such Letters of Credit not then reimbursed to
the Issuing Lender by Borrower pursuant to Section 2.4(d) and not the subject of Advances
made pursuant to Section 2.4(e).



     “Alternate Base Rate” means, as of any date of determination, the rate per annum
(rounded upwards, if necessary, to the next 1/100 of 1%) equal to the higher of (a) the Prime Rate
in effect on such date and (b) the Federal Funds Rate in effect on such date plus 1/2 of 1% (50
basis points).



     “Alternate Base Rate Advance” means an Advance under the Commitment made hereunder and
specified to be an Alternate Base Rate Advance in accordance with Article 2.



     “Alternate Base Rate Loan” means a Revolving Loan made hereunder and specified to be
an Alternate Base Rate Loan in accordance with Article 2.



2









 





     “Applicable Alternate Base Rate Margin” means, for each Pricing Period, the interest
rate margin set forth below (expressed in basis points per annum) opposite the Applicable Pricing
Level for that Pricing Period:



	 	 	 
	Applicable	 	 
	Pricing Level	 	Margin
	 
	 	 
	I

	 	175 bps
	II

	 	200 bps
	III

	 	225 bps
	IV

	 	250 bps
	V

	 	275 bps






     “Applicable Commitment Fee Rate” means, for each Pricing Period, the rate set forth
below (expressed in basis points per annum) opposite the Applicable Pricing Level for that Pricing
Period:



	 	 	 
	Applicable	 	 
	Pricing Level	 	Margin
	 
	 	 
	I

	 	50 bps
	II

	 	60 bps
	III

	 	70 bps
	IV

	 	80 bps
	V

	 	90 bps






     “Applicable Eurodollar Rate Margin” means, for each Pricing Period, the interest rate
margin set forth below (expressed in basis points per annum) opposite the Applicable Pricing Level
for that Pricing Period:



	 	 	 
	Applicable	 	 
	Pricing Level	 	Margin
	 
	 	 
	I

	 	275 bps
	II

	 	300 bps
	III

	 	325 bps
	IV

	 	350 bps
	V

	 	375 bps






     “Applicable Pricing Level” means, for each Pricing Period, the pricing level set forth
below opposite the Leverage Ratio as of the last day of the Fiscal Quarter most recently ended
prior to the commencement of that Pricing Period:



3









 





	 	 	 
	Pricing Level	 	Leverage Ratio
	 
	 	 
	I

	 	Less than 1.00 to 1.00
	II

	 	Greater than or equal to 1.00 to 1.00, but less than 1.50 to
1.00
	III

	 	Greater than or equal to 1.50 to 1.00, but less than 2.00 to
1.00
	IV

	 	Greater than or equal to 2.00 to 1.00, but less than 2.50 to
1.00
	V

	 	Greater than or equal to 2.50 to 1.00





provided that (i) in the event that Borrower does not deliver a Pricing Certificate with
respect to any Pricing Period prior to the commencement of such Pricing Period, then until such
Pricing Certificate is delivered, the Applicable Pricing Level for that Pricing Period shall be
Pricing Level V, but once Borrower has delivered a Pricing Certificate with respect to such Pricing
Period, then any resulting change in the Applicable Pricing Level shall be made retroactively to
the beginning of such Pricing Period, and (ii) if any Pricing Certificate is subsequently
determined to be in error, then any resulting change in the Applicable Pricing Level shall be made
retroactively to the beginning of the relevant Pricing Period.




     “Arranger” means Union Bank.



     “Bank Products” means any one or more of the following types of services or facilities
extended to Borrower or any Subsidiary Guarantor by any Lender or any Affiliate of a Lender in
reliance on such Lender’s agreement to indemnify such Affiliate: (i) credit cards; (ii) automated
clearing house transfer or funds; (iii) overdrafts; (iv) interest rate swap transactions; and (v)
foreign exchange contracts.



     “Banking Day” means any Monday, Tuesday, Wednesday, Thursday or Friday, other
than a day on which banks are authorized or required to be closed in California or New York.



     “Capital Expenditure” means any expenditure by Borrower or any of its Subsidiaries for
or related to fixed assets or purchased intangibles that is treated as a capital expenditure under
GAAP, including any amount which is required to be treated as an asset subject to a Capital
Lease Obligation. The amount of Capital Expenditures in respect of fixed assets purchased or
constructed by Borrower or any of its Subsidiaries in any fiscal period shall be net of (a)
any net sales proceeds received during such fiscal period by Borrower or such Subsidiary for fixed
assets sold by Borrower or such Subsidiary and (b) any casualty insurance proceeds received during
such fiscal period by Borrower or such Subsidiary for casualties to fixed assets and applied to the
repair or replacement thereof.



     “Capital Lease Obligations” means all monetary obligations of a Person under any
leasing or similar arrangement which, in accordance with GAAP, is classified as a capital lease.



     “Cash” means, when used in connection with any Person, all monetary and non-monetary
items owned by that Person that are treated as cash in accordance with GAAP, consistently applied.



     “Cash Equivalents” means money-market instruments of the type described in Borrower’s
Investment Policy, a copy of which is attached hereto as Exhibit L.



4









 





     “Cash Income Taxes” means, with respect to any fiscal period, taxes on or measured by
the income of Borrower that are paid or currently payable in Cash by Borrower during that fiscal
period.



     “Cash Interest Expense” means Interest Expense that is paid or currently payable in
Cash.



     “Certificate” means a certificate signed by a Senior Officer or Responsible Official
(as applicable) of the Person providing the certificate.



     “Change in Control” means (a) any transaction or series of related transactions in
which any Unrelated Person or two or more Unrelated Persons acting in concert acquire beneficial
ownership (within the meaning of Rule 13d-3(a)(l) under the Securities Exchange Act of 1934, as
amended), directly or indirectly, of 35% or more of the outstanding Common Stock, (b) Borrower
consolidates with or merges into another Person or conveys, transfers or leases its properties and
assets substantially as an entirety to any Person or any Person consolidates with or merges into
Borrower, in either event pursuant to a transaction in which the outstanding Common Stock is
changed into or exchanged for cash, securities or other property, with the effect that any
Unrelated Person becomes the beneficial owner, directly or indirectly, of 35% or more of Common
Stock, or (c) during any period of 24 consecutive months, individuals who at the beginning of such
period constituted the board of directors of Borrower (together with any new or replacement
directors whose election by the board of directors, or whose nomination for election, was approved
by a vote of at least a majority of the directors then still in office who were either directors at
the beginning of such period or whose election or nomination for reelection was previously so
approved) cease for any reason to constitute a majority of the directors then in office. For
purposes of the foregoing, the term “Unrelated Person” means any Person other than (i) a
Subsidiary of Borrower or (ii) an employee stock ownership plan or other employee benefit plan
covering the employees of Borrower and its Subsidiaries.



     “Closing Date” means the time and Banking Day on which the conditions set forth in
Section 8.1 are satisfied or waived. The Administrative Agent shall notify Borrower, the
Lenders and the Collateral Agent of the date that is the Closing Date.



     “Code” means the Internal Revenue Code of 1986, as amended or replaced and as in
effect from time to time.



     “Collateral” means all of the collateral covered by the Security Agreement and the
Pledge Agreement.



     “Collateral Agent” means UNION BANK OF CALIFORNIA, N.A. when acting in its capacity as
the Collateral Agent under any of the Loan Documents, or any successor Collateral Agent.



     “Commercial Letter of Credit” means each Letter of Credit issued to support the
purchase of goods by Borrower which is determined to be a commercial letter of credit by the
Issuing Lender.



     “Commitment” means, subject to Sections 2.5 and 2.8, $85,000,000. The
respective Pro Rata Shares of the Lenders with respect to the Commitment are set forth in
Schedule 1.1.



5









 





     “Commitment Assignment and Acceptance” means a commitment assignment and acceptance
substantially in the form of Exhibit A.



     “Common Stock” means the common stock of Borrower or its successor.



     “Compliance Certificate” means a certificate in the form of Exhibit B,
properly completed and signed by a Senior Officer of Borrower.



     “Contractual Obligation” means, as to any Person, any material provision of any
outstanding security issued by that Person or of any material agreement, instrument or undertaking
to which that Person is a party or by which it or any of its Property is bound.



     “Credit Issuance” means the making of an Advance or the issuance of a Letter of
Credit.



     “Debtor Relief Laws” means the Bankruptcy Code of the United States of America, as
amended from time to time, and all other applicable liquidation, conservatorship, bankruptcy,
moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws
from time to time in effect affecting the rights of creditors generally.



     “Default” means any event that, with the giving of any applicable notice or passage of
time specified in Section 9.1, or both, would be an Event of Default.



     “Default Rate” has the meaning given in Section 3.1(d).



     “Designated Deposit Account” means a deposit account to be maintained by Borrower with
Union Bank or one of its Affiliates, as from time to time designated by Borrower by written
notification to the Administrative Agent.



     “Designated Eurodollar Market” means, with respect to any Eurodollar Rate Loan, the
London Eurodollar Market.



     “Disqualified Stock” means any capital stock, warrants, options or other rights to
acquire capital stock (but excluding any debt security which is convertible, or exchangeable, for
capital stock), which, by its terms (or by the terms of any security into which it is convertible
or for which it is exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of
the holder thereof, in whole or in part, on or prior to the Revolving Loan Maturity Date.



     “Disposition” means the sale, transfer or other disposition in any single transaction
or series of related transactions of any asset, or group of related assets, of Borrower or any of
its Subsidiaries (a) which asset or assets constitute a line of business or substantially all the
assets of Borrower or the Subsidiary or (b) the aggregate amount of the Net Cash Sales Proceeds of
such assets is more than $10,000,000, other than (i) inventory or other assets sold or
otherwise disposed of in the ordinary course of business of Borrower or its Subsidiary or normal in
the industry, (ii) equipment sold or otherwise disposed of where substantially similar equipment in
replacement thereof has theretofore been acquired, or thereafter within 90 days is acquired, by
Borrower or its Subsidiary, (iii) assets no longer useful in the business of Borrower and its
Subsidiaries and (iv) cash, cash equivalents or other assets contributed , transferred, sold or



6









 







otherwise assigned by Borrower or any of its Subsidiaries to any of the JV Holding Companies
or the ViaSat-1 Project or by any of the JV Holding Companies to the ViaSat-1 Project.



     “Distribution” means, with respect to any shares of capital stock or any warrant or
option to purchase an equity security or other equity security issued by a Person, (a) the
retirement, redemption, purchase or other acquisition for Cash or for Property by such Person of
any such security, (b) the declaration or (without duplication) payment by such Person of any
dividend in Cash or in Property on or with respect to any such security, (c) any Investment by such
Person in the holder of 5% or more of any such security if a purpose of such Investment is to avoid
characterization of the transaction as a Distribution and (d) any other payment in Cash or Property
by such Person constituting a distribution under applicable Laws with respect to such security.



     “Dollars” or “$” means United States of America dollars.



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



     “EBITDA” means the sum of (a) Net Income plus (b) to the extent deducted in
determining Net Income, (i) Interest Expense, (ii) expense for taxes paid or accrued, (iii)
depreciation, (iv) amortization, (v) any extraordinary non-cash or nonrecurring non-cash charges or
losses, and (vi) any non-cash charges arising from compensation expense as a result of the adoption
of Financial Accounting Standards Board Statement 123 (Revised 2004), “Share-Based Payment”, which
requires certain stock-based compensation to be recorded as expense within the Borrower’s
consolidated statement of operations, minus (c)(i) to the extent included in Net Income, any
extraordinary non-cash or nonrecurring non-cash gains, (ii) the amount of any subsequent cash
payments in respect of any non-cash charges described in the preceding clause (b)(vi), and (iii)
Interest income; all calculated for the Borrower and its Subsidiaries on a consolidated basis.



     “Eligible Assignee” means (a) another Lender, (b) with respect to any Lender, any
Affiliate of that Lender, (c) any commercial bank having total assets of $1,000,000,000 or more,
(d) any (i) savings bank, savings and loan association or similar financial institution or (ii)
insurance company engaged in the business of writing insurance which, in either case (A) has total
assets of $1,000,000,000 or more, (B) is engaged in the business of lending money and extending
credit under credit facilities substantially similar to those emended under this Agreement and (C)
is operationally and procedurally able to meet the obligations of a Lender hereunder to the same
degree as a commercial bank and (e) any other financial institution (including a mutual
fund or other fund) having total assets of $1,000,000,000 or more which meets the requirements set
forth in subclauses (B) and (C) of clause (d) above; provided that each Eligible Assignee
must either (aa) be organized under the Laws of the United States of America, any State thereof or
the District of Columbia or be organized under the Laws of the Cayman Islands or any country which
is a member of the Organization for Economic Cooperation and Development, or a political
subdivision of such a country, and (i) act hereunder through a branch, agency or funding office
located in the United States of America and (ii) be exempt from withholding of tax on interest and
deliver the documents related thereto pursuant to Section 11.21.



7









 





     “ERISA” means the Employee Retirement Income Security Act of 1974, and any regulations
or rulings issued pursuant thereto, as amended or replaced and as in effect from time to time.



     “ERISA Affiliate” means each Person (whether or not incorporated) which is required to
be aggregated with Borrower pursuant to Section 414 of the Code.



     “Eurodollar Banking Day” means any Banking Day on which dealings in Dollar deposits
are conducted by and among banks in the Designated Eurodollar Market.



     “Eurodollar Lending Office” means, as to each Lender, its office or branch so
designated by written notice to Borrower and the Administrative Agent as its Eurodollar Lending
Office. If no Eurodollar Lending Office is designated by a Lender, its Eurodollar Lending Office
shall be its office at its address for purposes of notices hereunder.



     “Eurodollar Market” means a regular established market located outside the United
States of America by and among banks for the solicitation, offer and acceptance of Dollar deposits
in such banks.



     “Eurodollar Obligations” means eurocurrency liabilities, as defined in Regulation D or
any comparable regulation of any Governmental Agency having jurisdiction over any Lender.



     “Eurodollar Period” means, as to each Eurodollar Rate Loan, the period commencing on
the date specified by Borrower pursuant to Section 2.1(c) and ending 1, 2, 3 or, if
available, 6 months (or, with the written consent of all of the Lenders, any other period)
thereafter, as specified by Borrower in the applicable Request for Loan; provided that:



          (a) The first day of any Eurodollar Period shall be a Eurodollar Banking Day;



          (b) Any Eurodollar Period that would otherwise end on a day that is not a Eurodollar Banking
Day shall be extended to the immediately succeeding Eurodollar Banking Day unless such Eurodollar
Banking Day falls in another calendar month, in which case such Eurodollar Period shall end on the
immediately preceding Eurodollar Banking Day; and



          (c) No Eurodollar Period shall extend beyond the Revolving Loan Maturity Date.



     “Eurodollar Rate” means, with respect to any Eurodollar Rate Loan, the average of the
interest rates per annum (rounded upward, if necessary, to the next 1/100 of 1%) at which deposits
in Dollars are offered to the Administrative Agent in the Designated Eurodollar Market at or about
11:00 a.m. local time in the Designated Eurodollar Market, two (2) Eurodollar Banking Days before
the first day of the applicable Eurodollar Period in an aggregate amount approximately equal to the
amount of the Advance to be made by the Administrative Agent with respect to such Eurodollar Rate
Loan and for a period of time comparable to the number of days in the applicable Eurodollar Period.



     “Eurodollar Rate Advance” means an Advance made hereunder and specified to be a
Eurodollar Rate Advance in accordance with Article 2.



8









 





     “Eurodollar Rate Loan” means a Loan made hereunder and specified to be a Eurodollar
Rate Loan in accordance with Article 2.



     “Event of Default” shall have the meaning provided in Section 9.1.



     “Existing Letters of Credit” means the letters of credit, if any, outstanding on the
Closing Date and listed on Schedule 2.4.



     “Existing Loan Agreement” shall have the meaning provided in the recitals to this
Agreement.



     “Federal Funds Rate” means, as of any date of determination, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor publication, published by the
Federal Reserve Board (including any such successor, “H.15(519)”) for such date opposite the
caption “Federal Funds (Effective).” If for any relevant date such rate is not yet published in
H.15(519), the rate for such date will be the rate set forth in the daily statistical release
designated as the Composite 3:30 p.m. Quotations for U.S. Government Securities, or any successor
publication, published by the Federal Reserve Lender of New York (including any such successor, the
“Composite 3:30 p.m. Quotation”) for such date under the caption “Federal Funds Effective Rate.”
If on any relevant date the appropriate rate for such date is not yet published in either H.15(519)
or the Composite 3:30 p.m. Quotations, the rate for such date will be the arithmetic mean of the
rates for the last transaction in overnight Federal funds arranged prior to 9:00 a.m. (New York
City time) on that date by each of three leading brokers of Federal funds transactions in New York
City selected by the Administrative Agent. For purposes of this Agreement, any change in the
Alternate Base Rate due to a change in the Federal Funds Rate shall be effective as of the opening
of business on the effective date of such change.



     “Fiscal Quarter” means the fiscal quarter of Borrower consistent with the Borrower’s
SEC filings.



     “Fiscal Year” means the fiscal year of Borrower ending on the last Business Day of
each March.



     “Foreign Subsidiary” means a Subsidiary of Borrower that is organized under the Laws
of a country (or political subdivision thereof) other than the United States of America.



     “Funded Debt” means, as to any Person, the types of Indebtedness listed in clauses (a)
(excluding Guarantee Obligations), (c), (d) and (e) (excluding (i) contingent obligations and (ii)
letters of credit referenced in clause (e) of the definition of “Indebtedness” to the extent such
letters of credit are standby letters of credit and have not been drawn upon) of the definition of
“Indebtedness.”



     “GAAP” means, as of any date of determination, accounting principles (a) set forth as
generally accepted in then currently effective Opinions of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (b) set forth as generally accepted in then
currently effective Statements of the Financial Accounting Standards Board or (c) that are then
approved by such other entity as may be approved by a significant segment of the accounting
profession in the United States of America. The term “consistently applied,” as used in



9









 







connection therewith, means that the accounting principles applied are consistent in all
material respects with those applied at prior dates or for prior periods.



     “Government Securities” means readily marketable (a) direct full faith and credit
obligations of the United States of America or obligations guaranteed by the full faith and credit
of the United States of America and (b) obligations of an agency or instrumentality of, or
corporation owned, controlled or sponsored by, the United States of America that are generally
considered in the securities industry to be implicit obligations of the United States of America.



     “Governmental Agency” means (a) any international, foreign, federal, state, county or
municipal government, or political subdivision thereof, (b) any governmental or quasi-governmental
agency, authority, board, bureau, commission, department, instrumentality or public body or (c) any
court or administrative tribunal of competent jurisdiction.



     “Guaranty Obligation” means, as to any Person, any (a) guarantee by that Person of
Indebtedness of, or other obligation performable by, any other Person or (b) assurance given by
that Person to an obligee of any other Person with respect to the performance of an obligation by,
or the financial condition of, such other Person, whether direct, indirect or contingent,
including any purchase or repurchase agreement covering such obligation or any collateral
security therefor, any agreement to provide funds (by means of loans, capital contributions or
otherwise) to such other Person, any agreement to support the solvency or level of any balance
sheet item of such other Person or any “keep-well” or other arrangement of whatever nature given
for the purpose of assuring or holding harmless such obligee against loss with respect to any
obligation of such other Person; provided, however, that the term Guaranty Obligation shall
not include endorsements of instruments for deposit or collection in the ordinary course of
business. The amount of any Guaranty Obligation in respect of Indebtedness shall be deemed to be
an amount equal to the stated or determinable amount of the related Indebtedness (unless the
Guaranty Obligation is limited by its terms to a lesser amount, in which case to the extent of such
amount) or, if not stated or determinable, the maximum reasonably anticipated liability in respect
thereof as determined by the Person in good faith. The amount of any other Guaranty Obligation
shall be deemed to be zero unless and until the amount thereof has been (or in accordance with
Financial Accounting Standards Board Statement No. 5 should be) quantified and reflected or
disclosed in the consolidated financial statements (or notes thereto) of Borrower.



     “Hazardous Materials” means substances defined as “hazardous substances”
pursuant to the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42
U.S.C. § 9601 et seq., or as “hazardous”, “toxic” or “pollutant” substances or as “solid waste”
pursuant to the Hazardous Materials Transportation Act, 49 U.S.C. § 1801, et seq., the Resource
Conservation and Recovery Act, 42 U.S.C. § 6901, et seq., or as “friable asbestos” pursuant to the
Toxic Substances Control Act, 15 U.S.C. § 2601 et seq. or any other applicable Hazardous Materials
Law, in each case as such Laws are amended from time to time.



     “Hazardous Materials Laws” means all Laws governing the treatment, transportation or
disposal of Hazardous Materials applicable to any of the Real Property.



     “Indebtedness” means, as to any Person (without duplication), (a) indebtedness of such
Person for borrowed money or for the deferred purchase price of Property (excluding trade and



10









 







other accounts payable in the ordinary course of business in accordance with ordinary trade
terms), including any Guaranty Obligation for any such indebtedness, (b) indebtedness of
such Person of the nature described in clause (a) that is non-recourse to the credit of such Person
but is secured by assets of such Person, to the extent of the fair market value of such assets as
determined in good faith by such Person, (c) Capital Lease Obligations of such Person, (d)
indebtedness of such Person arising under bankers’ acceptance facilities, (e) any direct or
contingent obligations of such Person under letters of credit issued for the account of such Person
and (f) any net obligations of such Person under Interest Rate Protection Agreements.



     “Intangible Assets” means assets that are considered intangible assets under GAAP,
including customer lists, goodwill, covenants not to compete, copyrights, trade names,
trademarks, licenses and patents.



     “Interest Coverage Ratio” means, as of any date of determination, the ratio of (a)
EBITDA for the fiscal period consisting of the four (4) quarters ended on such date to (b) Interest
Expense of Borrower and its Subsidiaries for such period.



     “Interest Expense” means, with respect to any Person and as of the last day of any
fiscal period, the sum of (a) all interest, fees, charges and related expenses (in each
case as such expenses are calculated according to GAAP) paid or payable (without duplication) for
that fiscal period by that Person to a lender in connection with borrowed money (including
any obligations for fees, charges and related expenses payable to the issuer of any letter of
credit) or the deferred purchase price of assets that are considered “interest expense” under GAAP
plus (b) the portion of rent paid or payable (without duplication) for that fiscal period
by that Person under Capital Lease Obligations that should be treated as interest in accordance
with Financial Accounting Standards Board Statement No. 13.



     “Interest Rate Protection Agreement” means a written agreement between Borrower and
one or more financial institutions providing for “swap”, “cap”, “collar” or other interest rate
protection with respect to any Indebtedness.



     “Investment” means, when used in connection with any Person, any investment by or of
that Person, whether by means of purchase or other acquisition of stock or other securities of any
other Person or by means of a loan, advance creating a debt, capital contribution, guaranty or
other debt or equity participation or interest in any other Person, including any
partnership and joint venture interests of such Person. The amount of any Investment shall be the
amount actually invested (minus any return of capital with respect to such Investment which
has actually been received in Cash or has been converted into Cash), without adjustment for
subsequent increases or decreases in the value of such Investment.



     “Issuing Lender” means Union Bank or any other Lender capable of issuing Commercial
Letters of Credit or Standby Letters of Credit.



     “Joint Venture” means any direct or indirect Investment by Borrower in any Person that
is not a Wholly-Owned Subsidiary of Borrower, which Person is engaged in the same or a similar line
of business as Borrower.



11









 





     “JV Holding Companies” means each wholly owned subsidiary of ViaSat Satellite
Ventures, LLC, which own all or any portion of the ViaSat-1 Joint Venture.



     “Laws” means, collectively, all international, foreign, federal, state and local
statutes, treaties, rules, regulations, ordinances, codes and administrative or judicial
precedents.



     “Lender” means each lender whose name is set forth in the signature pages of this
Agreement and each lender which may hereafter become a party to this Agreement pursuant to Section
11.8.



     “Letters of Credit” means (a) the Existing Letters of Credit and (b) any of the
Commercial Letters of Credit or Standby Letters of Credit issued by the Issuing Lender under the
Commitment pursuant to Section 2.4, either as originally issued or as the same may be
supplemented, modified, amended, renewed, extended or supplanted.



     “Leverage Ratio” means, as of any date of determination, the ratio of (a) all
Indebtedness of Borrower and its Subsidiaries on that date to (b) EBITDA for the period consisting
of the four (4) quarters ended on that date.



     “Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment for
security, security interest, encumbrance, lien or charge of any kind, whether voluntarily incurred
or arising by operation of Law or otherwise, affecting any Property, including any
conditional sale or other title retention agreement, any lease in the nature of a security
interest, and/or the filing of any financing statement (other than a precautionary financing
statement with respect to a lease that is not in the nature of a security interest) under the
Uniform Commercial Code or comparable Law of any jurisdiction with respect to any Property.



     “Loan” means, as the context may require, the amount of a particular Advance made or
to be made, or the aggregate of the Advances made at any one time by the Lenders pursuant to
Section 2.1.



     “Loan Documents” means, collectively, this Agreement, the Notes, the Pledge Agreement,
the Subsidiary Guaranty, the Security Agreement, the Subsidiary Security Agreement and any other
agreements of any type or nature hereafter executed and delivered by Borrower or any of the
Subsidiary Guarantors to the Administrative Agent, the Collateral Agent or to any Lender in any way
relating to or in furtherance of this Agreement, in each case either as originally executed or as
the same may from time to time be supplemented, modified, amended, restated, extended or
supplanted.



     “Margin Stock” means “margin stock” as such term is defined in Regulation U.



     “Material Adverse Effect” means any set of circumstances or events which (a) has had
or could reasonably be expected to have any material adverse effect whatsoever upon the validity or
enforceability of any Loan Document, (b) has been or could reasonably be expected to be material
and adverse to the business or condition (financial or otherwise) of Borrower and its Subsidiaries,
taken as a whole or (c) has had a material adverse effect or could reasonably be expected to have a
material adverse effect on the ability of Borrower to perform the Obligations.



12









 





     “Maximum ViaSat-1 Joint Venture Investments” means the aggregate amount of (i)
$250,000,000 (which includes, without limitation, Borrower’s cash on hand), plus (ii) 100% of Net
Cash Issuance Proceeds from the issuance of Subordinated Obligations of Borrower or any of its
Subsidiaries; plus (iii) 100% of Net Cash Issuance Proceeds from the issuance of equity securities
of Borrower or any of its Subsidiaries (except an issuance of equity securities to Borrower or to a
Wholly-Owned Subsidiary or to employees or former employees of Borrower pursuant to an employee
stock option plan maintained by Borrower).



     “Monthly Payment Date” means the first day of each calendar month.



     “Multiemployer Plan” means any employee benefit plan of the type described in Section
4001(a)(3) of ERISA to which Borrower or any of its ERISA Affiliates contributes or is obligated to
contribute.



     “Net Cash Issuance Proceeds” means, with respect to the issuance of any debt security
or equity security by Borrower or any of its Subsidiaries, the Cash proceeds received by or for the
account of Borrower or such Subsidiary in consideration of such issuance net of (a) underwriting
discounts and commissions actually paid to any Person not an Affiliate of Borrower and (b)
professional fees and disbursements actually paid in connection therewith.



     “Net Cash Sales Proceeds” means, with respect to any Disposition, the sum of
(a) the Cash proceeds received by or for the account of Borrower and its Subsidiaries from such
Disposition plus (b) the amount of Cash received by or for the account of Borrower and its
Subsidiaries upon the sale, collection or other liquidation of any proceeds that are not Cash from
such Disposition, in each case net of (i) any amount required to be paid to any Person
owning an interest in the assets disposed of, (ii) any amount applied to the repayment of
Indebtedness secured by a Lien permitted under Section 6.9 on the asset disposed of, (iii)
any transfer, income or other taxes payable as a result of such Disposition, (iv) professional fees
and expenses, fees due to any Governmental Agency, broker’s commissions and other out-of-pocket
costs of sale actually paid to any Person that is not an Affiliate of Borrower attributable to such
Disposition and (v) any reserves established in accordance with GAAP in connection with such
Disposition.



     “Net Income” means, with respect to any fiscal period, the consolidated net income of
Borrower and its Subsidiaries for that period, determined in accordance with GAAP, consistently
applied.



     “New Lender Agreement” has the meaning set forth in Section 2.8(c).



     “Note” means any of the Revolving Notes, and “Notes” means all of the
Revolving Notes.



     “Obligations” means all present and future obligations of every kind or nature of
Borrower or any of the Subsidiary Guarantors at any time and from time to time owed to the
Administrative Agent, the Collateral Agent or the Lenders or any one or more of them, under any one
or more of the Loan Documents, whether due or to become due, matured or unmatured, liquidated or
unliquidated, or contingent or noncontingent, including obligations of performance as well
as obligations of payment, and including interest that accrues after the commencement of
any proceeding under any Debtor Relief Law by or against Borrower or any of the Subsidiary



13









 







Guarantors. “Obligations” includes, without limitation, all debts, liabilities and
obligations now or hereafter owing from Borrower and any Subsidiary Guarantor to any Lender or any
Affiliate of a Lender arising from or related to Bank Products.



     “Opinion of Counsel” means the favorable written legal opinion of counsel to Borrower,
substantially in the form of Exhibit C, together with copies of factual certificates and
legal opinions, if any, delivered to such counsel in connection with such opinion upon which such
counsel has relied.



     “Party” means any Person other than the Administrative Agent, the Collateral Agent and
the Lenders, which now or hereafter is a party to any of the Loan Documents.



     “PBGC” means the Pension Benefit Guaranty Corporation or any successor thereof
established under ERISA.



     “Pension Plan” means any “employee pension benefit plan” (as such term is defined in
Section 3(2) of ERISA), other than a Multiemployer Plan, which is subject to Title IV of
ERISA and is maintained by Borrower or to which Borrower contributes or has an obligation to
contribute.



     “Permitted Acquisition” means any Acquisition by Borrower or any Subsidiary of
Borrower (as applicable, the “acquiror”) of another Person engaged in the same or a similar line of
business as that of the acquiror (the “target”), provided that: (i) no Default or Event of
Default shall exist at the time of such Acquisition or occur after giving effect to such
Acquisition; (ii) such Acquisition shall have been approved by the board of directors of the
target; (iii) if the total consideration (whether such consideration is in the form of capital
stock, cash or otherwise) for such Acquisition exceeds $20,000,000, the pro-forma balance sheets
and combining projections (including pro-forma financial covenant ratios) provided by Borrower to
the Administrative Agent shall have demonstrated that, after giving effect to such Acquisition, (a)
Borrower would have been in compliance with the financial covenants set forth in Sections 6.13 and
6.14 of this Agreement throughout the period of the four (4) Fiscal Quarters most recently
ended prior to the date of such Acquisition (or such shorter period in which the target has been in
existence) and (b) Borrower would remain in compliance with such financial covenants for the period
of four (4) Fiscal Quarters immediately following the date of such Acquisition; (iv) if the total
consideration (whether such consideration is in the form of capital stock, cash or otherwise) for
such Acquisition exceeds $20,000,000, Borrower shall have borrowing availability under the
Commitment or cash on hand of at least $20,000,000 after giving effect to such Acquisition; (v) the
terms and conditions of any and all seller purchase-money financing provided to the acquiror in
connection with such Acquisition (other than the ViaSat-1 Joint Venture) shall be acceptable to the
Administrative Agent and the Lenders in their reasonable discretion; (vi) Borrower shall use
commercially reasonable efforts to provide the Administrative Agent with at least one (1) week
prior written notice of such Acquisition, together with at least one (1) year (or such shorter
period in which the target has been in existence) of historical financial information relating to
the target and such other documentation pertaining to the Acquisition, including pro forma
quarterly projections, as the Administrative Agent may reasonably request; and (vii) after giving
effect to such Acquisition, the Borrower shall not have made Acquisitions, the total consideration
for which (whether such consideration



14









 







is in the form of capital stock, cash or otherwise) exceeds:
(a)
$35,000,000 in the aggregate for any single acquisition by the Borrower and (b) $100,000,000
in the aggregate from and after the Closing Date.



     “Permitted Business” means: a) the study, research, development, testing, and support
of “off-the-shelf,” semi-custom and custom communication and satellite systems, products and
components (including without limitation terrestrial, airborne and space systems); b) the design,
manufacture, production, sale and distribution of satellite and other wireless or wired
communications and networking systems to government and commercial customers (including without
limitation terrestrial, airborne and space systems); c) the management of network satellite and
other communication and information services; d) the business of Borrower as historically and
currently conducted, and as otherwise disclosed in its future SEC filings and (e) any and all
business and other activities related to, in furtherance of, or ancillary to the foregoing.



     “Permitted Encumbrances” means, with respect to Borrower and its Subsidiaries:



          (a) inchoate Liens incident to construction on or maintenance of Property; or Liens incident
to construction on or maintenance of Property now or hereafter filed of record for which adequate
reserves have been set aside (or deposits made pursuant to applicable Law) and which are being
contested in good faith by appropriate proceedings and have not proceeded to judgment,
provided that, by reason of nonpayment of the obligations secured by such Liens, no such
Property is subject to a material impending risk of loss or forfeiture;



          (b) Liens for taxes and assessments on Property which are not yet past due; or Liens for taxes
and assessments on Property for which adequate reserves have been set aside and are being contested
in good faith by appropriate proceedings and have not proceeded to judgment, provided that,
by reason of nonpayment of the obligations secured by such Liens, no such Property is subject to a
material impending risk of loss or forfeiture;



          (c) defects and irregularities in title to any Property which in the aggregate do not
materially impair the fair market value or use of the Property for the purposes for which it is or
may reasonably be expected to be held;



          (d) easements, exceptions, reservations, or other agreements for the purpose of pipelines,
conduits, cables, wire communication lines, power lines and substations, streets, trails, walkways,
drainage, irrigation, water, and sewerage purposes, dikes, canals, ditches, the removal of oil,
gas, coal, or other minerals, and other like purposes affecting Property which in the aggregate do
not materially burden or impair the fair market value or use of such Property for the purposes for
which it is or may reasonably be expected to be held;



          (e) easements, exceptions, reservations, or other agreements for the purpose of facilitating
the joint or common use of Property in or adjacent to a shopping center or similar project
affecting Property which in the aggregate do not materially burden or impair the fair market value
or use of such Property for the purposes for which it is or may reasonably be expected to be held;



15









 





          (f) rights reserved to or vested in any Governmental Agency to control or regulate, or
obligations or duties to any Governmental Agency with respect to, the use of any Property;



          (g) rights reserved to or vested in any Governmental Agency to control or regulate, or
obligations or duties to any Governmental Agency with respect to, any right, power, franchise,
grant, license, or permit;



          (h) present or future zoning laws and ordinances or other laws and ordinances restricting the
occupancy, use, or enjoyment of Property;



          (i) statutory Liens, other than those described in clauses (a) or (b) above, arising in the
ordinary course of business with respect to obligations which are not delinquent or are being
contested in good faith, provided that, if delinquent, adequate reserves have been set
aside with respect thereto and, by reason of nonpayment, no Property is subject to a material
impending risk of loss or forfeiture;



          (j) covenants, conditions, and restrictions affecting the use of Property which in the
aggregate do not materially impair the fair market value or use of the Property for the purposes
for which it is or may reasonably be expected to be held;



          (k) rights of tenants under leases and rental agreements covering Property entered into in the
ordinary course of business of the Person owning such Property;



          (l) Liens consisting of pledges or deposits to secure obligations under workers’ compensation
laws or similar legislation, including Liens of judgments thereunder which are not currently
dischargeable;



          (m) Liens consisting of pledges or deposits of Property to secure performance in connection
with operating leases made in the ordinary course of business;



          (n) Liens consisting of deposits of Property to secure bids made with respect to, or
performance of, contracts (other than contracts creating or evidencing an extension of
credit to the depositor);



          (o) Liens consisting of any right of offset, or statutory bankers’ lien, on bank deposit
accounts maintained in the ordinary course of business so long as such bank deposit accounts are
not established or maintained for the purpose of providing such right of offset or bankers’ lien;



          (p) Liens consisting of deposits of Property to secure statutory obligations of Borrower and
its Subsidiaries;



          (q) Liens consisting of deposits of Property to secure (or in lieu of) surety, appeal or
customs bonds;



          (r) Liens created by or resulting from any litigation or legal proceeding in the ordinary
course of business which is currently being contested in good faith by appropriate



16









 







proceedings, provided that, adequate reserves have been set aside and no material
Property is subject to a material impending risk of loss or forfeiture;



          (s) Liens created to secure the purchase price of property or assets; provided, that
(i) any such Lien shall attach only to the property or assets purchased, (ii) the Indebtedness
secured by any such Lien shall not exceed one hundred percent (100%) of the purchase price of the
property or assets purchased, (iii) any such Lien shall be created concurrently with or within
twelve (12) months following the acquisition of such property or assets, and (iv) the principal
amount of Indebtedness of Borrower and its Subsidiaries secured by such Liens does not exceed
$5,000,000 in the aggregate at any time; and



          (t) other non-consensual Liens incurred in the ordinary course of business but not in
connection with the incurrence of any Indebtedness, which do not in the aggregate, when taken
together with all other Liens, materially impair the fair market value or use of the Property for
the purposes for which it is or may reasonably be expected to be held.



     “Permitted Right of Others” means a Right of Others consisting of (a) an interest
(other than a legal or equitable co-ownership interest, an option or right to acquire a
legal or equitable co-ownership interest and any interest of a ground lessor under a ground lease),
that does not materially impair the fair market value or use of Property for the purposes for which
it is or may reasonably be expected to be held, (b) an option or right to acquire a Lien that would
be a Permitted Encumbrance, (c) the subordination of a lease or sublease in favor of a financing
entity and (d) a license, or similar right, of or to Intangible Assets granted in the ordinary
course of business.



     “Person” means any individual or entity, including a trustee, corporation,
limited liability company, general partnership, limited partnership, joint stock company, trust,
estate, unincorporated organization, business association, firm, joint venture, Governmental
Agency, or other entity.



     “Pledge Agreement” means the pledge agreement to be executed and delivered pursuant to
Section 5.12 by Borrower, in the form of Exhibit D, either as originally executed
or as it may from time to time be supplemented, modified, amended, extended or supplanted.



     “Pricing Certificate” means a certificate in the form of Exhibit E, properly
completed and signed by a Senior Officer or his or her designated representative of Borrower.



     “Pricing Period” means (a) the period commencing on the Closing Date and ending on
December 1, 2008, and (b) thereafter, the period commencing on each December 2, March 2, June 2,
and September 2 and ending on the next following March 1, June 1, September 1 or December 1,
respectively.



     “Prime Rate” means the rate of interest publicly announced from time to time by the
Administrative Agent in San Francisco, California (or other headquarters city of the Administrative
Agent), as its “reference rate.” The “reference rate” is one of several base rates used by the
Administrative Agent and serves as the basis upon which effective rates of interest are calculated
for loans and other credits making reference thereto. The “reference rate” is not necessarily the
lowest base interest rate used by the Administrative Agent. The “reference rate”



17









 







is evidenced by the recording thereof after its announcement in such internal publication or
publications as the Administrative Agent may designate. Any change in the Prime Rate announced by
the Administrative Agent shall take effect at the opening of business on the day specified in the
public announcement of such change.



     “Projections” means the projected financial information to be prepared by Borrower and
furnished to the Lenders hereunder.



     “Property” means any interest in any kind of property or asset, whether real, personal
or mixed, or tangible or intangible.



     “Pro Rata Share” means, with respect to each Lender, the percentage of the Commitment
set forth opposite the name of that Lender on Schedule 1.1, as such percentage may be
increased or decreased pursuant to Section 2.8 and/or a Commitment Assignment and
Acceptance executed in accordance with Section 11.8.



     “Quarterly Payment Date” means each April 1, July 1, October 1 and January 1,
commencing with January 1, 2009.



     “Real Property” means, as of any date of determination, all real property then or
theretofore owned, leased or occupied by any of Borrower or its Subsidiaries.



     “Regulation D” means Regulation D, as at any time amended, of the Board of Governors
of the Federal Reserve System, or any other regulation in substance substituted therefor.



     “Regulation U” means Regulation U, as at any time amended, of the Board of Governors
of the Federal Reserve System, or any other regulation in substance substituted therefor.



     “Request for Letter of Credit” means a written request for a Letter of Credit
substantially in the form of Exhibit F, signed by a Responsible Official of Borrower and
properly completed to provide all information required to be included therein.



     “Request for Loan” means a written request for a Loan substantially in the form of
Exhibit G, signed by a Responsible Official of Borrower, on behalf of Borrower, and
properly completed to provide all information required to be included therein.



     “Requirement of Law” means, as to any Person, the articles or certificate of
incorporation and by-laws or other organizational or governing documents of such Person, and any
Law, or judgment, award, decree, writ or determination of a Governmental Agency, in each case
applicable to or binding upon such Person or any of its Property or to which such Person or any of
its Property is subject.



     “Requisite Lenders” means (a) as of any date of determination if the Commitments are
then in effect, Lenders having in the aggregate 66 2/3% or more of the Commitments then in effect,
and (b) as of any date of determination if the Commitments have then been suspended or terminated
and there is then any Indebtedness evidenced by the Notes, Lenders holding Notes evidencing in the
aggregate 66 2/3% or more of the aggregate Indebtedness then evidenced by



18









 







the Notes, and, in any event, not less than three (3) Lenders or, if there are less than three
(3) Lenders, all Lenders.



     “Responsible Official” means (a) any Senior Officer of Borrower and (b) any other
responsible official of Borrower so designated in a written notice thereof from a Senior Officer to
the Administrative Agent. The Lenders shall be entitled to conclusively rely upon any document or
certificate that is signed or executed by a Responsible Official of Borrower or any of its
Subsidiaries as having been authorized by all necessary corporate, partnership and/or other action
on the part of Borrower or such Subsidiary.



     “Revolving Loan” means a Loan made under the Commitment.



     “Revolving Loan Maturity Date” means October 31, 2011.



     “Revolving Note” means any of the promissory notes made by Borrower to a Lender
evidencing Advances under that Lender’s Pro Rata Share of the Commitment, substantially in the form
of Exhibit H, either as originally executed or as the same may from time to time be
supplemented, modified, amended, renewed, extended or supplanted.



     “Right of Others” means, as to any Property in which a Person has an interest, any
legal or equitable right, title or other interest (other than a Lien) held by any other Person in
that Property, and any option or right held by any other Person to acquire any such right, title or
other interest in that Property, including any option or right to acquire a Lien;
provided, however, that (a) no covenant restricting the use or disposition of Property of
such Person contained in any Contractual Obligation of such Person and (b) no provision contained
in a contract creating a right of payment or performance in favor of a Person that conditions,
limits, restricts, diminishes, transfers or terminates such right shall be deemed to constitute a
Right of Others.



     “Satellite System” means (i) the ViaSat-1 satellite to be manufactured by Space
Systems/Loral, Inc. and (ii) next-generation SurfBeam and other ground infrastructure (including
user terminals and hub equipment).



     “Security Agreement” means the security agreement to be executed and delivered
pursuant to Article 8 by Borrower and the Subsidiary Guarantors, in the form of Exhibit
I, either as originally executed or as it may from time to time be supplemented, modified,
amended, extended or supplanted.



     “Senior Officer” means (a) the chief executive officer, (b) the president, (c) any
executive vice president, (d) the chief financial officer or (e) the treasurer, in each case of
Borrower.



     “Significant Domestic Subsidiary” means a Significant Subsidiary that is not a Foreign
Subsidiary; provided that, for purposes of this Agreement, Trellisware, the JV Holding Companies
and the ViaSat-1 Joint Venture shall not be deemed to be Significant Domestic Subsidiaries.



     “Significant Foreign Subsidiary” means a Foreign Subsidiary that is a Significant
Subsidiary.




19












 





     “Significant Subsidiary” means a Subsidiary that either (i) had net income for the
Fiscal Year then most recently ended in excess of 5% of Net Income for such Fiscal Year or (ii) had
net assets in excess of 5% of the total net assets of Borrower and its Subsidiaries on a
consolidated basis as at the end of the Fiscal Year then most recently ended.



     “Solvent” means, as of any date of determination, and as to any Person, that on such
date: (a) the fair valuation of the assets of such Person is greater than the fair valuation of
such Person’s probable liability in respect of existing debts; (b) such Person does not intend to,
and does not believe that it will, incur debts beyond such Person’s ability to pay as such debts
mature; (c) such Person is not engaged in a business or transaction, and is not about to engage in
a business or transaction, which would leave such Person with assets remaining which would
constitute unreasonably small capital after giving effect to the nature of the particular business
or transaction; and (d) such Person is generally paying its debts as they become due. For the
purpose of the foregoing (1) the “fair valuation” of any assets means the amount realizable within
a reasonable time, either through collection or sale, of such assets at their regular market value,
which is the amount obtainable by a capable and diligent businessman from an interested buyer
willing to purchase such assets within a reasonable time under ordinary circumstances; and (2) the
term “debts” includes any legal liability whether matured or unmatured, liquidated or unliquidated,
absolute, fixed, or contingent.



     “Special Eurodollar Circumstance” means the application or adoption after the Closing
Date of any Law or interpretation, or any change therein or thereof, or any change in the
interpretation or administration thereof by any Governmental Agency, central bank or comparable
authority charged with the interpretation or administration thereof, or compliance by any Lender or
its Eurodollar Lending Office with any request or directive (whether or not having the force of
Law) of any such Governmental Agency, central bank or comparable authority.



     “Standby Letter of Credit” means each Letter of Credit issued by the Issuing Lender
under the Commitment pursuant to Section 2.4 to support the payment or performance of an
obligation by Borrower.



     “Stockholders’ Equity” means, as of any date of determination and with respect to any
Person, the consolidated stockholders’ equity of the Person as of that date determined in
accordance with GAAP; provided that there shall be excluded from Stockholders’ Equity any
amount attributable to Disqualified Stock.



     “Subordinated Obligations” means any Indebtedness of Borrower that (a) does not have
any scheduled principal payment, mandatory principal prepayment or sinking fund payment due prior
to the date that is one year after the Revolving Loan Maturity Date, (b) is not secured by any Lien
on any Property of Borrower or any of its Subsidiaries, (c) is not guarantied by any Subsidiary of
Borrower unless, if such Subsidiary is a party to the Subsidiary Guaranty, such guaranty of such
Indebtedness is subordinated to the Subsidiary Guaranty in a manner satisfactory to the
Administrative Agent, (d) is subordinated by its terms in right of payment to the Obligations
pursuant to provisions acceptable to the Requisite Lenders, (e) is subject to such financial and
other covenants and events of defaults as may be acceptable to the Requisite Lenders and (f) is
subject to customary interest blockage and delayed acceleration provisions as may be acceptable to
the Requisite Lenders.



20









 





     “Subsidiary” means, as of any date of determination and with respect to any Person,
any corporation, limited liability company or partnership (whether or not, in any case,
characterized as such or as a “joint venture”), whether now existing or hereafter organized
or acquired: (a) in the case of a corporation or limited liability company, of which a majority of
the securities having ordinary voting power for the election of directors or other governing body
(other than securities having such power only by reason of the happening of a contingency) are at
the time beneficially owned by such Person and/or one or more Subsidiaries of such Person, or (b)
in the case of a partnership, of which a majority of the partnership or other ownership interests
are at the time beneficially owned by such Person and/or one or more of its Subsidiaries.
Notwithstanding the foregoing, except for purposes of Sections 6.11, 6.13,
6.14, 7.1(a) through (d), Section 7.3, Sections 9.1(g),
(i) and (j), the definitions of Indebtedness, Interest Expense and EBITDA,
Trellisware, the JV Holding Companies and the ViaSat-1 Joint Venture shall not be deemed to be
“Subsidiaries,” and the representations and warranties set forth in Article 4, the
covenants set forth in Article 5 and Article 6, and the Events of Default set forth
in Section 9.1 shall not apply to Trellisware, the JV Holding Companies or the ViaSat-1
Joint Venture.



     “Subsidiary Guarantors” means all Significant Domestic Subsidiaries.



     “Subsidiary Guaranty” means the continuing guaranty of the Obligations to be executed
and delivered pursuant to Article 8 by the Subsidiary Guarantors, in the form of
Exhibit J, either as originally executed or as it may from time to time be supplemented,
modified, amended, extended or supplanted.



     “Subsidiary Security Agreement” means the security agreement to be executed and
delivered pursuant to Article 8 by the Subsidiary Guarantors, in the form of Exhibit
K, either as originally executed or as it may from time to time be supplemented, modified,
amended, extended or supplanted.



     “to the best knowledge of” means, when modifying a representation, warranty or other
statement of any Person, that the feet or situation described therein is known by the Person (or,
in the case of a Person other than a natural Person, known by a Responsible Official of that
Person) making the representation, warranty or other statement, or with the exercise of reasonable
due diligence under the circumstances (in accordance with the standard of what a reasonable Person
in similar circumstances would have done) would have been known by the Person (or, in the case of a
Person other than a natural Person, would have been known by a Responsible Official of that
Person).



     “Trellisware” means Trellisware Technologies, Inc., a Delaware corporation, and
Wholly-Owned Subsidiary of Borrower.



     “type,” when used with respect to any Loan or Advance, means the designation of
whether such Loan or Advance is an Alternate Base Rate Loan or Advance, or a Eurodollar Rate Loan
or Advance.



     “Union Bank” means Union Bank of California, N.A., a national banking association.



     “ViaSat-1 Holding Companies” means any of ViaSat Satellite Ventures, LLC, and/or the
JV Holding Companies.



21









 





     “ViaSat-1 Joint Venture” means any Joint Venture among the JV Holding Companies and
any other Person with respect to the ViaSat-1 Project.



     “ViaSat-1 Project” means the business of: (a) procuring, managing, launching,
operating and commercializing the Satellite System (and replacements thereof) for the provision of
broadband internet access; (b) provisioning the Satellite System capacity for use in connection
with other broadband access and applications, including (1) enterprise VSAT access, (2) government
broadband access applications, (3) backhaul for other local access technologies (e.g. wireless,
remote DSL and cable), (4) mobile broadband access applications (both commercial and government),
(5) broadcast and specialized video applications, and (6) other new broadband applications; (c)
pursuing additional businesses, including the procurement, lease, launch, operation and
commercialization of one or more additional high capacity satellites; and (d) such other lawful
business activities reasonably necessary or advisable in furtherance of the foregoing purposes.



     “ViaSat Satellite Ventures, LLC” means ViaSat Satellite Ventures, LLC, a [to be
formed] Delaware limited liability company and wholly-owned Subsidiary of Borrower, and the 100%
owner of the issued and outstanding capital stock of the JV Holding Companies.



     “Wholly-Owned Subsidiary” means a Subsidiary of Borrower, 100% of the capital stock or
other equity interest of which is owned, directly or indirectly, by Borrower, except for director’s
qualifying shares required by applicable Laws.



     1.2 Use of Defined Terms. Any defined term used in the plural shall refer to all
members of the relevant class, and any defined term used in the singular shall refer to any one or
more of the members of the relevant class.



     1.3 Accounting Terms. All accounting terms not specifically defined in this Agreement
shall be construed in conformity with, and all financial data required to be submitted by this
Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, except as
otherwise specifically prescribed herein. In the event that GAAP changes during the term of this
Agreement such that the covenants contained in Sections 6.13 through 6.15 would
then be calculated in a different manner or with different components, Borrower and the Lenders
agree to amend this Agreement in such respects as are necessary to conform those covenants as
criteria for evaluating Borrower’s financial condition to substantially the same criteria as were
effective prior to such change in GAAP and Borrower shall be deemed to be in compliance with the
covenants contained in the aforesaid Sections if and to the extent that Borrower would have been in
compliance therewith under GAAP as in effect immediately prior to such change, but shall have the
obligation to deliver each of the materials described in Article 7 to the Administrative
Agent and the Lenders, on the dates therein specified, with financial data presented in a manner
which conforms with GAAP as in effect immediately prior to such change.



     1.4 Rounding. Any financial ratios required to be maintained by Borrower pursuant to
this Agreement shall be calculated by dividing the appropriate component by the other component,
carrying the result to one place more than the number of places by which such ratio is expressed in
this Agreement and rounding the result up or down to the nearest number (with a



22









 




round-up if there is no nearest number) to the number of places by which such ratio is
expressed in this Agreement.




     1.5 Exhibits and Schedules. All Exhibits and Schedules to this Agreement, either as
originally existing or as the same may from time to time be supplemented, modified or amended, are
incorporated herein by this reference. A matter disclosed on any Schedule shall be deemed
disclosed on all Schedules.



     1.6 References to “Borrower and its Subsidiaries”. Any reference herein to “Borrower
and its Subsidiaries” or the like shall refer solely to Borrower during such times, if any, as
Borrower shall have no Subsidiaries.



     1.7 Miscellaneous Terms. The term “or” is disjunctive; the term “and” is conjunctive.
The term “shall” is mandatory; the term “may” is permissive. Masculine terms also apply to
females; feminine terms also apply to males. The term “including” is by way of example and not
limitation.



23









 





Article 2

LOANS AND LETTERS OF CREDIT




     2.1 Loans — General.



          (a) Subject to the terms and conditions set forth in this Agreement, at any time and from time
to time from the Closing Date through the Revolving Loan Maturity Date, each Lender shall, pro rata
according to that Lender’s Pro Rata Share of the then applicable Commitment, make Advances to
Borrower under the Commitment in such amounts as Borrower may request that do not result in the
sum of (i) the aggregate principal amount outstanding under the Revolving Notes and (ii)
the Aggregate Effective Amount of all outstanding Letters of Credit to exceed the then applicable
Commitment. Subject to the limitations set forth herein, Borrower may borrow, repay and reborrow
under the Commitment without premium or penalty.




          (b) Subject to the next sentence, each Loan shall be made pursuant to a Request for Loan which
shall specify the requested (i) date of such Loan, (ii) type of Loan, (iii) amount of such Loan,
and (iv) in the case of a Eurodollar Rate Loan, the Eurodollar Period for such Loan. Unless the
Administrative Agent has notified, in its reasonable discretion, Borrower to the contrary, a Loan
may be requested by telephone by a Responsible Official of Borrower, in which case Borrower shall
confirm such request by promptly delivering a Request for Loan (conforming to the preceding
sentence) in person or by telecopier to the Administrative Agent. The Administrative Agent shall
incur no liability whatsoever hereunder in acting upon any telephonic request for Loan purportedly
made by a Responsible Official of Borrower, and Borrower hereby agrees to indemnify the
Administrative Agent from any loss, cost, expense or liability as a result of so acting.




          (c) Promptly following receipt of a Request for Loan, the Administrative Agent shall notify
each Lender by telephone or telecopier (and if by telephone, promptly confirmed by telecopier) of
the date and type of the Loan, the applicable Eurodollar Period, and that Lender’s Pro Rata Share
of the Loan. Not later than 12:00 p.m., California time, on the date specified for any Loan (which
must be a Banking Day), each Lender shall make its Pro Rata Share of the Loan in immediately
available funds available to the Administrative Agent at the Administrative Agent’s Office. Upon
satisfaction or waiver of the applicable conditions set forth in Article 8, all Advances
shall be credited on that date in immediately available funds to the Designated Deposit Account.




          (d) Unless the Requisite Lenders otherwise consent, each Revolving Loan which is an Alternate
Base Rate Loan shall be not less than $1,000,000 and in an integral multiple of $500,000 and each
Revolving Loan which is a Eurodollar Rate Loan shall be not less than $5,000,000 and in an integral
multiple of $1,000,000.




          (e) The Advances made by each Lender under the Commitment shall be evidenced by that Lender’s
Revolving Note.




          (f) A Request for Loan that is a Eurodollar Rate Loan shall become irrevocable three
Eurodollar Banking Days before the requested date of the Loan. A Request for



24









 






Loan that is an Alternate Base Rate Loan shall become irrevocable one Banking Day before the
requested date of the Loan.




          (g) If no Request for Loan (or telephonic request for Loan referred to in the second sentence
of Section 2.1(c), if applicable) has been made within the requisite notice periods set
forth in Section 2.2 or 2.3 prior to the end of the Eurodollar Period for any
outstanding Eurodollar Rate Loan, then on the last day of such Eurodollar Period, such Eurodollar
Rate Loan shall be automatically converted into an Alternate Base Rate Loan in the same amount.




     2.2 Alternate Base Rate Loans. Each request by Borrower for an Alternate Base Rate
Loan shall be made pursuant to a Request for Loan (or telephonic or other request for loan referred
to in the second sentence of Section 2.1(c), if applicable) received by the Administrative
Agent, at the Administrative Agent’s Office, not later than 10:00 a.m. California time, on the date
(which must be a Banking Day) immediately prior to the date of the requested Alternate Base Rate
Loan. All Loans shall constitute Alternate Base Rate Loans unless properly designated as a
Eurodollar Rate Loan pursuant to Section 2.3.



     2.3 Eurodollar Rate Loans.



          (a) Each request by Borrower for a Eurodollar Rate Loan shall be made pursuant to a Request
for Loan (or telephonic or other request for Loan referred to in the second sentence of Section
2.1(c), if applicable) received by the Administrative Agent, at the Administrative Agent’s
Office, not later than 9:00 a.m., California time, at least three (3) Eurodollar Banking Days
before the first day of the applicable Eurodollar Period.




          (b) On the date which is two (2) Eurodollar Banking Days before the first day of the
applicable Eurodollar Period, the Administrative Agent shall confirm its determination of the
applicable Eurodollar Rate (which determination shall be conclusive in the absence of manifest
error) and promptly shall give notice of the same to Borrower and the Lenders by telephone or
telecopier (and if by telephone, promptly confirmed by telecopier).




          (c) Unless the Administrative Agent and the Requisite Lenders otherwise consent, no more than
four (4) Eurodollar Rate Loans shall be outstanding at any one time.




          (d) No Eurodollar Rate Loan may be requested during the continuation of a Default or Event of
Default.




          (e) Nothing contained herein shall require any Lender to fund any Eurodollar Rate Advance in
the Designated Eurodollar Market.




     2.4 Letters of Credit.



          (a) The Existing Letters of Credit described in Schedule 2.4 shall be Letters of
Credit for all purposes under this Agreement.





     (1) Subject to the terms and conditions hereof, at any time and from time to
time from the Closing Date through the Revolving Loan Maturity Date,



25









 







the Issuing Lender shall issue such Letters of Credit under the Commitment as
Borrower may request by a Request for Letter of Credit; provided that:




     (i) giving effect to all such Letters of Credit, the sum of:




     (A) the aggregate principal amount outstanding under the
Revolving Notes; plus




     (B) the Aggregate Effective Amount of all outstanding Letters of
Credit, does not exceed the then applicable Commitment; and




     (ii) the Aggregate Effective Amount under all outstanding Letters of Credit
does not exceed $25,000,000.




     (2) Each Letter of Credit shall be in a form reasonably acceptable to the
Issuing Lender.




     (3) Unless all the Lenders otherwise consent in a writing delivered to the
Administrative Agent, the term of any Letter of Credit (other than any Existing
Letters of Credit) shall not exceed twelve (12) months.




     (4) The term of any Letter of Credit (other than any Existing Letters of
Credit) shall not extend beyond the Revolving Loan Maturity Date unless all the
Lenders otherwise consent in a writing delivered to the Administrative Agent;
provided, however, that a condition to the repayment in full of the
Obligations and release of the Collateral shall include either (a) the Borrower’s
provision to the Issuing Lender of cash collateral in the amount equal to 100% of
the face amount of any Letter of Credit that will remain outstanding after repayment
in full of the Obligations other than those relating to such Letter of Credit (or
such lesser amount as shall then be available for drawing under any Letter of
Credit); or (b) the Borrower’s provision to the Issuing Lender of a “back-up”
standby letter of credit in the foil face amount of any Letter of Credit that will
remain outstanding after repayment in full of the Obligations other than those
relating to such Letter of Credit (or such lesser amount as shall then be available
under the Requested Letter of Credit) issued by a bank acceptable to the Issuing
Bank in its reasonable discretion.



          (b) Each Request for Letter of Credit shall be submitted to the Issuing Lender, with a copy to
the Administrative Agent, at least two (2) Banking Days prior to the date upon which the related
Letter of Credit is proposed to be issued. The Administrative Agent shall promptly notify the
Issuing Lender whether such Request for Letter of Credit, and the issuance of a Letter of Credit
pursuant thereto, conforms to the requirements of this Agreement. Upon issuance of a Letter of
Credit, the Issuing Lender shall promptly notify the Administrative Agent, and the Administrative
Agent shall promptly notify the Lenders, of the amount and terms thereof.




26









 








          (c) Upon the issuance of a Letter of Credit, each Lender shall be deemed to have purchased a
pro rata participation in such Letter of Credit from the Issuing Lender in an amount equal to that
Lender’s Pro Rata Share of the Commitment. Without limiting the scope and nature of each Lender’s
participation in any Letter of Credit, to the extent that the Issuing Lender has not been
reimbursed by Borrower for any payment required to be made by the Issuing Lender under any Letter
of Credit, each Lender shall, pro rata according to its Pro Rata Share, reimburse the Issuing
Lender through the Administrative Agent promptly upon demand for the amount of such payment. The
obligation of each Lender to so reimburse the Issuing Lender shall be absolute and unconditional
and shall not be affected by the occurrence of an Event of Default or any other occurrence or
event. Any such reimbursement shall not relieve or otherwise impair the obligation of Borrower to
reimburse the Issuing Lender for the amount of any payment made by the Issuing Lender under any
Letter of Credit together with interest as hereinafter provided.




          (d) Borrower agrees to pay to the Issuing Lender through the Administrative Agent an amount
equal to any payment made by the Issuing Lender with respect to each Letter of Credit within one
(1) Banking Day after demand made by the Issuing Lender therefor, together with interest on such
amount from the date of any payment made by the Issuing Lender at the rate applicable to Alternate
Base Rate Loans for two (2) Banking Days and thereafter at the Default Rate. The principal amount
of any such payment shall be used to reimburse the Issuing Lender for the payment made by it under
the Letter of Credit and, to the extent that the Lenders have not reimbursed the Issuing Lender
pursuant to Section 2.4(c). the interest amount of any such payment shall be for the
account of the Issuing Lender. Each Lender that has reimbursed the Issuing Lender pursuant to
Section 2.4(c) for its Pro Rata Share of any payment made by the Issuing Lender under a
Letter of Credit shall thereupon acquire a pro rata participation, to the extent of such
reimbursement, in the claim of the Issuing Lender against Borrower for reimbursement of principal
and interest under this Section 2.4(d) and shall share, in accordance with that pro rata
participation, in any principal payment made by Borrower with respect to such claim and in any
interest payment made by Borrower (but only with respect to periods subsequent to the date such
Lender reimbursed the Issuing Lender) with respect to such claim.




          (e) Borrower may, pursuant to a Request for Loan, request that Advances be made pursuant to
Section 2.1(a) to provide funds for the payment required by Section 2.4(d) and, for
this purpose, the conditions precedent set forth in Article 8 shall not apply. The
proceeds of such Advances shall be paid directly to the Issuing Lender to reimburse it for the
payment made by it under the Letter of Credit.




          (f) If Borrower fails to make the payment required by Section 2.4(d) within the time
period therein set forth, in lieu of the reimbursement to the Issuing Lender under Section
2.4(c) the Issuing Lender may (but is not required to), without notice to or the consent of
Borrower, instruct the Administrative Agent to cause Advances to be made by the Lenders under the
Commitment in an aggregate amount equal to the amount paid by the Issuing Lender with respect to
that Letter of Credit and, for this purpose, the conditions precedent set forth in Article
8 shall not apply. The proceeds of such Advances shall be paid directly to the Issuing Lender
to reimburse it for the payment made by it under the Letter of Credit.




27









 








          (g) The issuance of any supplement, modification, amendment, renewal, or extension to or of
any Letter of Credit shall be treated in all respects the same as the issuance of a new Letter of
Credit.




          (h) The obligation of Borrower to pay to the Issuing Lender the amount of any payment made by
the Issuing Lender under any Letter of Credit shall be absolute, unconditional, and irrevocable,
subject only to performance by the Issuing Lender of its obligations to Borrower under Uniform
Commercial Code Section 5109. Without limiting the foregoing, Borrower’s obligations shall not be
affected by any of the following circumstances:





               (i) any lack of validity or enforceability prior to its stated expiration date
of the Letter of Credit, this Agreement, or any other agreement or instrument
relating thereto;




               (ii) any amendment or waiver of or any consent to departure from the Letter of
Credit, this Agreement, or any other agreement or instrument relating thereto, with
the consent of Borrower;




               (iii) the existence of any claim, setoff, defense, or other rights which
Borrower may have at any time against the Issuing Lender, the Administrative Agent
or any Lender, any beneficiary of the Letter of Credit (or any persons or entities
for whom any such beneficiary may be acting) or any other Person, whether in
connection with the Letter of Credit, this Agreement, or any other agreement or
instrument relating thereto, or any unrelated transactions;




               (iv) any demand, statement, or any other document presented under the Letter of
Credit proving to be forged, fraudulent, invalid, or insufficient in any respect or
any statement therein being untrue or inaccurate in any respect whatsoever so long
as any such document appeared substantially to comply with the terms of the Letter
of Credit;




               (v) payment by the Issuing Lender in good faith under the Letter of Credit
against presentation of a draft or any accompanying document which does not strictly
comply with the terms of the Letter of Credit, unless the acceptance of such draft
or other accompanying document constituted gross negligence;




               (vi) the existence, character, quality, quantity, condition, packing, value or
delivery of any Property purported to be represented by documents presented in
connection with any Letter of Credit or any difference between any such Property and
the character, quality, quantity, condition, or value of such Property as described
in such documents;




               (vii) the time, place, manner, order or contents of shipments or deliveries of
Property as described in documents presented in connection with any Letter of Credit
or the existence, nature and extent of any insurance relative thereto;



28









 






               (viii) the solvency or financial responsibility of any party issuing any
documents in connection with a Letter of Credit;




               (ix) any failure or delay in notice of shipments or arrival of any Property;




               (x) any error in the transmission of any message relating to a Letter of Credit
not caused by the Issuing Lender, or any delay or interruption in any such message;




               (xi) any error, neglect or default of any correspondent of the Issuing Lender
in connection with a Letter of Credit;




               (xii) any consequence arising from acts of God, war, insurrection, civil
unrest, disturbances, labor disputes, emergency conditions or other causes beyond
the control of the Issuing Lender;




               (xiii) so long as the Issuing Lender in good faith determines that the contract
or document appears substantially to comply with the terms of the Letter of Credit,
the form, accuracy, genuineness or legal effect of any contract or document referred
to in any document submitted to the Issuing Lender in connection with a Letter of
Credit unless the Issuing Lender’s actions constituted gross negligence; and




               (xiv) where the Issuing Lender has acted in good faith and observed general
banking usage, any other circumstances whatsoever unless the Issuing Lender’s
actions constituted gross negligence.



          (i) The Issuing Lender shall be entitled to the protection accorded to the Administrative
Agent pursuant to Section 10.6, with all necessary changes.




          (j) The Uniform Customs and Practice for Documentary Credits, as published in its most current
version by the International Chamber of Commerce, shall be deemed a part of this Section and shall
apply to all Letters of Credit to the extent not inconsistent with applicable Law.




     2.5 Voluntary Reduction of Commitment. Borrower shall have the right, at any time and
from time to time, without penalty or charge, upon at least five (5) Banking Days’ prior written
notice by a Responsible Official of Borrower to the Administrative Agent, voluntarily to reduce,
permanently and irrevocably, in aggregate principal amounts in an integral multiple of $1,000,000
but not less than $10,000,000, or to terminate, all or a portion of the then undisbursed portion of
the Commitment. The Administrative Agent shall promptly notify the Lenders of any reduction or
termination of the Commitment under this Section.



     2.6 Administrative Agent’s Right to Assume Funds Available for Advances. Unless the
Administrative Agent shall have been notified by any Lender no later than 10:00 a.m. on the Banking
Day of the proposed funding by the Administrative Agent of any Loan that such Lender does not
intend to make available to the Administrative Agent such Lender’s portion of the total



29









 




amount of such Loan, the Administrative Agent may assume that such Lender has made such amount
available to the Administrative Agent on the date of the Loan and the Administrative Agent may, in
reliance upon such assumption, make available to Borrower a corresponding amount. If the
Administrative Agent has made funds available to Borrower based on such assumption and such
corresponding amount is not in fact made available to the Administrative Agent by such Lender, the
Administrative Agent shall be entitled to recover such corresponding amount on demand from such
Lender. If such Lender does not pay such corresponding amount forthwith upon the Administrative
Agent’s demand therefor, the Administrative Agent promptly shall notify Borrower and Borrower shall
pay such corresponding amount to the Administrative Agent. The Administrative Agent also shall be
entitled to recover from such Lender interest on such corresponding amount in respect of each day
from the date such corresponding amount was made available by the Administrative Agent to Borrower
to the date such corresponding amount is recovered by the Administrative Agent, at a rate per annum
equal to the daily Federal Funds Rate. Nothing herein shall be deemed to relieve any Lender from
its obligation to fulfill its share of the Commitments or to prejudice any rights which the
Administrative Agent or Borrower may have against any Lender as a result of any default by such
Lender hereunder.




     2.7 Collateral. To the extent required in the Security Agreement, the Obligations
shall be secured by a first priority (subject to Liens permitted by Section 6.9)
perfected Lien on the Collateral pursuant to the Security Agreement.



     2.8 Increase of Commitment.



          (a) If no Default or Event of Default shall have occurred and be continuing, Borrower may at
any time from time to time prior to the Revolving Loan Maturity Date request no more than two (2)
increases of the Commitment by notice to the Administrative Agent in writing of the amount of such
proposed increase (each such notice, a “Commitment Increase Notice”); provided, however,
that, (i) the aggregate amount of the Commitment as so increased shall not exceed $50,000,000; and
(ii) each individual request for an increase shall be in the minimum amount of $25,000,000. Any
such Commitment Increase Notice delivered with respect to any proposed increase in the Commitment
may offer one or more Revolving Lenders an opportunity to subscribe for its Pro Rata Share (with
respect to the existing Commitment (prior to such increase)) of the increased Commitment. The
Administrative Agent shall, within five (5) Banking Days after receipt of a Commitment Increase
Notice, notify each Lender of such request. Each Lender desiring to increase its Commitment shall
notify the Administrative Agent in writing no later than ten (10) Banking Days after receipt of
notice from the Administrative Agent. Any Lender that does not notify the Administrative Agent
within the time period specified above that it will increase its Commitment will be deemed to have
rejected such offer. Any agreement by a Lender to increase its Commitment shall be irrevocable.




          (b) If any proposed increase in the Commitment is not fully subscribed by the existing Lenders
pursuant to the procedure outlined in Section 2.8(a) preceding, the Borrower may, in its
sole discretion, offer to any existing Lender or to one or more additional banks or financial
institutions which is an Eligible Assignee (each, a “New Lender”) the opportunity to
participate in all or a portion of such unsubscribed portion of the increased Commitment, by
notifying the Administrative Agent. Promptly and in any event within five (5) Banking Days after
receipt of notice from Borrower of its desire to offer such unsubscribed commitments to



30









 






certain existing Lenders or to any New Lender identified therein, the Administrative Agent
shall notify such proposed lenders of the opportunity to participate in all or a portion of such
unsubscribed portion of the increased Commitment.




          (c) Any New Lender which accepts the Borrower’s offer to participate in the increased
Commitment shall execute and deliver to the Administrative Agent and Borrower a Commitment
Assignment and Acceptance in accordance with Section 11.8 hereof (subject to the limitations on the
amounts thereof set forth herein), and upon the effectiveness of such Commitment Assignment and
Acceptance such New Lender shall become a Revolving Lender for all purposes and to the same extent
as if originally a party hereto and shall be bound by and entitled to the benefits of this
Agreement, and the signature pages hereof shall be deemed to be amended to add the name of such New
Lender.




     On any date on which Commitments are increased, subject to the satisfaction of the foregoing
terms and conditions, (i) each of the existing Lenders shall assign to each of the New Lenders, and
each of the New Lenders shall purchase from each of the existing Lenders, at the principal amount
thereof (together with accrued interest), such interests in the Loans outstanding on such date as
shall be necessary in order that, after giving effect to all such assignments and purchases, such
Loans will be held by existing Lenders and New Lenders ratably in accordance with their Commitments
after giving effect to the addition of such new Commitments to the total Commitments hereunder,
(ii) each new Commitment shall be deemed for all purposes a “Commitment” and each Loan made
thereunder shall be deemed, for all purposes, a “Loan” and (iii) each New Lender shall become a
“Lender” with respect to the new Commitment and all matters relating thereto. Upon any increase in
the Commitment pursuant to this Section 2.8, Schedule 1.1 shall be deemed amended
to reflect such new Commitment and Pro Rata Share of each Lender (including any New Lender), as
thereby increased or decreased, as appropriate.



31









 





Article 3

PAYMENTS AND FEES




     3.1 Principal and Interest.



          (a) Interest shall be payable on the outstanding daily unpaid principal amount of each Advance
from the date thereof until payment in full is made and shall accrue and be payable at the rates
set forth or provided for herein before and after Default, before and after maturity, before and
after judgment, and before and after the commencement of any proceeding under any Debtor Relief
Law, with interest on overdue interest at the Default Rate to the fullest extent permitted by
applicable Laws.




          (b) Interest accrued on each Alternate Base Rate Loan shall be due and payable on each Monthly
Payment Date. Except as otherwise provided in Sections 3.1(d) and 3.8, the unpaid
principal amount of any Alternate Base Rate Loan shall bear interest at a fluctuating rate per
annum equal to the Alternate Base Rate plus the Applicable Alternate Base Rate Margin.
Each change in the interest rate under this Section 3.1(b) due to a change in the Alternate
Base Rate shall take effect simultaneously with the corresponding change in the Alternate Base
Rate.




          (c) Interest accrued on each Eurodollar Rate Loan shall be due and payable on the last day of
the related Eurodollar Period. Except as otherwise provided in Sections 3.1(d) and
3.8, the unpaid principal amount of any Eurodollar Rate Loan shall bear interest at a rate
per annum equal to the Eurodollar Rate for that Eurodollar Rate Loan plus the Applicable
Eurodollar Rate Margin.




          (d) During the existence of an Event of Default, the Loans shall bear interest at a rate per
annum equal to the sum of (i) the interest rate specified in Sections 3.1(b) or
3.1(c). whichever is applicable, plus (ii) two (2) percentage points (the “Default
Rate”).




          (e) If not sooner paid, the principal Indebtedness evidenced by the Notes shall be payable as
follows:





               (i) the amount, if any, by which the sum of (a) the principal
Indebtedness evidenced by the Revolving Notes plus (b) the Aggregate
Effective Amount of all outstanding Letters of Credit at any time exceeds the then
applicable Commitment shall be payable immediately; and




               (ii) the principal Indebtedness evidenced by the Revolving Notes shall in any
event be payable on the Revolving Loan Maturity Date.



          (f) The principal Indebtedness evidenced by the Notes may, at any time and from time to time,
voluntarily be paid or prepaid in whole or in part without premium or penalty, except that with
respect to any voluntary prepayment under this Subsection, (i) any partial prepayment of a
Revolving Loan shall be not less than $500,000 and shall be an integral multiple of $100,000 unless
the entire outstanding amount of such Loan is being prepaid, (ii) the Administrative Agent shall
have received written notice of any prepayment by 9:00 a.m. California time on the date that is one
(1) Banking Day before the date of prepayment (which



32









 






must be a Banking Day) in the case of an Alternate Base Rate Loan, and, in the case of a
Eurodollar Rate Loan, three (3) Banking Days before the date of prepayment, which notice shall
identify the date and amount of the prepayment and the Loan(s) being prepaid, (iii) each prepayment
of principal on any Eurodollar Rate Loan shall be accompanied by payment of interest accrued to the
date of payment on the amount of principal paid, and (iv) any payment or prepayment of all or any
part of any Eurodollar Rate Loan on a day other than the last day of the applicable Eurodollar
Period shall be subject to Section 3.6(e).




     3.2 Closing Date Fees. On the Closing Date, Borrower shall pay each of the following
fees:



          (a) to the Administrative Agent, for the account of each Lender, a one-time upfront fee, based
upon each Lender’s Pro Rata Share of the Commitment on the Closing Date, as set forth in a separate
agreement among Borrower, the Administrative Agent and the Lenders;




          (b) to the Administrative Agent, for the sole account of the Arranger, such fees as are set
forth in a separate agreement between Borrower and the Arranger.




     3.3 Commitment Fee. From the Closing Date through the Revolving Loan Maturity Date,
Borrower shall pay to the Administrative Agent, for the ratable accounts of the Lenders pro rata
according to their Pro Rata Share of the Commitment, a commitment fee equal to the Applicable
Commitment Fee Rate per annum times the average daily amount by which the Commitment
exceeds an amount equal to the sum of (i) aggregate daily principal Indebtedness evidenced by the
Revolving Notes plus (ii) the Aggregate Effective Amount of all Letters of Credit then outstanding.
The commitment fee shall be payable quarterly in arrears as of each Quarterly Payment Date within
ten (10) days after receipt by Borrower of an invoice therefor from the Administrative Agent.



     3.4 Letter of Credit Fees. With respect to each Letter of Credit, Borrower shall pay
the following fees:



          (a) with respect to the issuance of each Standby Letter of Credit, (x) to the Administrative
Agent, for the benefit of the Issuing Lender, an issuance fee of 0.125% of the face amount of such
Standby Letter of Credit; and (y) to the Administrative Agent, for the Lenders ratably, in
accordance with their respective Pro Rata Shares of the Commitment, a standby letter of credit fee
in an amount equal to the Applicable Eurodollar Margin per annum times the face amount of such
Standby Letter of Credit through the termination or expiration of such Standby Letter of Credit;




          (b) with respect to the issuance of each Commercial Letter of Credit, to the Administrative
Agent a commercial letter of credit issuance fee in the amount set forth from time to time as the
Issuing Lender’s published scheduled fee for the issuance of commercial letters of credit, which
fee the Administrative Agent shall promptly pay to the Lenders ratably, in accordance with their
respective Pro Rata Shares of the Commitment; and




          (c) concurrently with each negotiation, drawing or amendment of each Commercial Letter of
Credit, to the Issuing Lender for the sole account of the Issuing Lender,



33









 






negotiation, drawing and amendment fees in the amounts set forth from time to time as the
Issuing Lender’s published scheduled fees for such services.



Each of the fees payable with respect to Letters of Credit under this Section is earned when due
and is nonrefundable and, with respect to Sections 3.4(a) and (b), shall be payable
quarterly in arrears.




     3.5 Increased Commitment Costs. If any Lender shall determine in good faith that the
introduction after the Closing Date of any applicable law, rule, regulation or guideline regarding
capital adequacy, or any change therein or any change in the interpretation or administration
thereof by any central bank or other Governmental Agency charged with the interpretation or
administration thereof, or compliance by such Lender (or its Eurodollar Lending Office) or any
corporation controlling such Lender, with any request, guideline or directive regarding capital
adequacy (whether or not having the force of Law) of any such central bank or other authority not
imposed as a result of such Lender’s or such corporation’s failure to comply with any other Laws,
affects or would affect the amount of capital required or expected to be maintained by such Lender
or any corporation controlling such Lender and (taking into consideration such Lender’s or such
corporation’s policies with respect to capital adequacy and such Lender’s desired return on
capital) determines in good faith that the amount of such capital is increased, or the rate of
return on capital is reduced, as a consequence of its obligations under this Agreement, then,
within five (5) Banking Days after demand of such Lender, Borrower shall pay to such Lender, from
time to time as specified in good faith by such Lender, additional amounts sufficient to compensate
such Lender in light of such circumstances, to the extent reasonably allocable to such obligations
under this Agreement, provided that Borrower shall not be obligated to pay any such amount
unless such Lender is charging similar amounts to similarly situated Borrowers and provided
further that Borrower shall not be obligated to pay any such amount which arose prior to the
date which is ninety (90) days preceding the date of such demand or is attributable to periods
prior to the date which is ninety (90) days preceding the date of such demand (except to the extent
of any retroactive application of the law, rule, regulation or guideline (or similar) giving rise
to such demand). Borrower may replace such Lender by notifying such Lender, within five (5)
Banking Days after demand of such Lender, of Borrower’s intention to replace such Lender and
Borrower shall then replace such Lender by causing such Lender to assign its Commitments to one or
more other then-existing Lenders or to another Eligible Assignee reasonably satisfactory to the
Administrative Agent and the other then-existing Lenders within forty-five (45) days after demand
of such Lender. Each Lender’s determination of such amounts shall be conclusive in the absence of
manifest error.



     3.6 Eurodollar Costs and Related Matters.



          (a) In the event that any Governmental Agency imposes on any Lender any reserve or comparable
requirement (including any emergency, supplemental or other reserve) with respect to the
Eurodollar Obligations of that Lender, Borrower shall pay that Lender within five (5) Banking Days
after demand all amounts necessary to compensate such Lender (determined as though such Lender’s
Eurodollar Lending Office had funded 100% of its Eurodollar Rate Advance in the Designated
Eurodollar Market) in respect of the imposition of such reserve requirements (provided that
Borrower shall not be obligated to pay any such amount unless such Lender is charging similar
amounts to similarly situated Borrowers and provided 




34









 







further that Borrower shall not be obligated to pay any such amount which arose prior
to the date which is ninety (90) days preceding the date of such demand or is attributable to
periods prior to the date which is ninety (90) days preceding the date of such demand (except to
the extent of any retroactive application of the law, rule, regulation or guideline (or similar)
giving rise to such demand)). The Lender’s determination of such amount shall be conclusive in the
absence of manifest error.




          (b) If, after the date hereof, the existence or occurrence of any Special Eurodollar
Circumstance:





     (1) shall subject any Lender or its Eurodollar Lending Office to any tax, duty
or other charge or cost with respect to any Eurodollar Rate Advance, any of its
Notes evidencing Eurodollar Rate Loans or its obligation to make Eurodollar Rate
Advances, or shall change the basis of taxation of payments to any Lender
attributable to the principal of or interest on any Eurodollar Rate Advance or any
other amounts due under this Agreement in respect of any Eurodollar Rate Advance,
any of its Notes evidencing Eurodollar Rate Loans or its obligation to make
Eurodollar Rate Advances, excluding (i) taxes imposed on or measured in
whole or in part by its overall net income by (a) any jurisdiction (or political
subdivision thereof) in which it is organized or maintains its principal office or
Eurodollar Lending Office or (b) any jurisdiction (or political subdivision thereof)
in which it is “doing business” and (ii) any withholding taxes or other taxes based
on gross income imposed by the United States of America for any period with respect
to which it has failed to provide Borrower with the appropriate form or forms
required by Section 11.21, to the extent such forms are then required by
applicable Laws;




     (2) shall impose, modify or deem applicable any reserve not applicable or
deemed applicable on the date hereof (including any reserve imposed by the
Board of Governors of the Federal Reserve System, special deposit, capital or
similar requirements against assets of, deposits with or for the account of, or
credit extended by, any Lender or its Eurodollar Lending Office); or




     (3) shall impose on any Lender or its Eurodollar Lending Office or the
Designated Eurodollar Market any other condition affecting any Eurodollar Rate
Advance, any of its Notes evidencing Eurodollar Rate Loans, its obligation to make
Eurodollar Rate Advances or this Agreement, or shall otherwise affect any of the
same;




and the result of any of the foregoing, as determined in good faith by such Lender,
increases the cost to such Lender or its Eurodollar Lending Office of making or
maintaining any Eurodollar Rate Advance or in respect of any Eurodollar Rate
Advance, any of its Notes evidencing Eurodollar Rate Loans or its obligation to make
Eurodollar Rate Advances or reduces the amount of any sum received or receivable by
such Lender or its Eurodollar Lending Office with respect to any Eurodollar Rate
Advance, any of its Notes evidencing Eurodollar Rate Loans or its obligation to make
Eurodollar Rate Advances (assuming such Lender’s



35









 







Eurodollar Lending Office had funded 100% of its Eurodollar Rate Advance in the
Designated Eurodollar Market), then, within five (5) Banking Days after demand by
such Lender (with a copy to the Administrative Agent), Borrower shall pay to such
Lender such additional amount or amounts as will compensate such Lender for such
increased cost or reduction (determined as though such Lender’s Eurodollar Lending
Office had funded 100% of its Eurodollar Rate Advance in the Designated Eurodollar
Market); provided that Borrower shall not be obligated to pay any such
amount unless such Lender is charging similar amounts to similarly situated
Borrowers and provided further that Borrower shall not be obligated to pay
any such amount which arose prior to the date which is ninety (90) days preceding
the date of such demand or is attributable to periods prior to the date which is
ninety (90) days preceding the date of such demand. A statement of any Lender
claiming compensation under this subSection shall be conclusive in the absence of
manifest error.



          (c) If, after the date hereof, the existence or occurrence of any Special Eurodollar
Circumstance shall, in the good faith opinion of any Lender, make it unlawful or impossible for
such Lender or its Eurodollar Lending Office to make, maintain or fund its portion of any
Eurodollar Rate Loan, or materially restrict the authority of such Lender to purchase or sell, or
to take deposits of, Dollars in the Designated Eurodollar Market, or to determine or charge
interest rates based upon the Eurodollar Rate, and such Lender shall so notify the Administrative
Agent, then such Lender’s obligation to make Eurodollar Rate Advances shall be suspended for the
duration of such illegality or impossibility and the Administrative Agent forthwith shall give
notice thereof to the other Lenders and Borrower. Upon receipt of such notice, the outstanding
principal amount of such Lender’s Eurodollar Rate Advances, together with accrued interest thereon,
automatically shall be converted to Alternate Base Rate Advances on either (1) the last day of the
Eurodollar Period(s) applicable to such Eurodollar Rate Advances if such Lender may lawfully
continue to maintain and fund such Eurodollar Rate Advances to such day(s) or (2) immediately if
such Lender may not lawfully continue to fund and maintain such Eurodollar Rate Advances to such
day(s), provided that in such event the conversion shall not be subject to payment of a
prepayment fee under Section 3.6(e). Each Lender agrees to endeavor promptly to notify
Borrower of any event of which it has actual knowledge, occurring after the Closing Date, which
will cause that Lender to notify the Administrative Agent under this Section, and agrees to
designate a different Eurodollar Lending Office if such designation will avoid the need for such
notice and will not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender. In the event that any Lender is unable, for the reasons set forth
above, to make, maintain or fund its portion of any Eurodollar Rate Loan, such Lender shall fund
such amount as an Alternate Base Rate Advance for the same period of time, and such amount shall be
treated in all respects as an Alternate Base Rate Advance. Borrower shall have the right to
replace such Lender by causing such Lender to assign its Commitments to one or more other
then-existing Lenders or to another Eligible Assignee reasonably satisfactory to the Administrative
Agent and the other then-existing Lenders. Any Lender whose obligation to make Eurodollar Rate
Advances has been suspended under this Section shall promptly notify the Administrative Agent and
Borrower of the cessation of the Special Eurodollar Circumstance which gave rise to such
suspension.




          (d) If, with respect to any proposed Eurodollar Rate Loan:




36









 









     (1) the Administrative Agent reasonably determines that, by reason of
circumstances affecting the Designated Eurodollar Market generally that are beyond
the reasonable control of the Lenders, deposits in Dollars (in the applicable
amounts) are not being offered to any Lender in the Designated Eurodollar Market for
the applicable Eurodollar Period; or




     (2) the Requisite Lenders advise the Administrative Agent that the Eurodollar
Rate as determined by the Administrative Agent (i) does not represent the effective
pricing to such Lenders for deposits in Dollars in the Designated Eurodollar Market
in the relevant amount for the applicable Eurodollar Period, or (ii) will not
adequately and fairly reflect the cost to such Lenders of making the applicable
Eurodollar Rate Advances; then the Administrative Agent forthwith shall give nonce
thereof to Borrower and the Lenders, whereupon until the Administrative Agent
notifies Borrower that the circumstances giving rise to such suspension no longer
exist, the obligation of the Lenders to make any future Eurodollar Rate Advances
shall be suspended.



          (e) Upon payment or prepayment of any Eurodollar Rate Advance (other than as the
result of a conversion required under Section 3.6(c)) on a day other than the last day in
the applicable Eurodollar Period (whether voluntarily, involuntarily, by reason of acceleration, or
otherwise), or upon the failure of Borrower (for a reason other than the breach by a Lender of its
obligation pursuant to Section 2.1(a) to make an Advance) to borrow on the date or in the
amount specified for a Eurodollar Rate Loan in any Request for Loan after such Request for Loan has
become irrevocable, Borrower shall pay to the appropriate Lender within five (5) Banking Days after
demand a prepayment fee or failure to borrow fee, as the case may be (determined as though 100% of
the Eurodollar Rate Advance had been funded in the Designated Eurodollar Market) equal to the sum
of:





     (1) $250; plus




     (2) the amount, if any, by which (i) the additional interest would have accrued
on the amount prepaid or not borrowed at the Eurodollar Rate plus the
Applicable Eurodollar Rate Margin if that amount had remained or been outstanding
through the last day of the applicable Eurodollar Period exceeds (ii) the
interest that the Lender could recover by placing such amount on deposit in the
Designated Eurodollar Market for a period beginning on the date of the prepayment or
failure to borrow and ending on the last day of the applicable Eurodollar Period
(or, if no deposit rate quotation is available for such period, for the most
comparable period for which a deposit rate quotation may be obtained); plus




     (3) all out-of-pocket expenses incurred by the Lender reasonably attributable
to such payment, prepayment or failure to borrow.


Each Lender’s determination of the amount of any prepayment fee payable under this Section shall be
conclusive in the absence of manifest error.




37









 








          (f) Each Lender agrees to endeavor promptly to notify Borrower of any event of which it has
actual knowledge, occurring after the Closing Date, which will entitle such Lender to compensation
pursuant to clause (a) or clause (b) of this Section, and agrees to designate a different
Eurodollar Lending Office if such designation will avoid the need for or reduce the amount of such
compensation and will not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender. Any request for compensation by a Lender under this Section shall
set forth the basis upon which it has been determined that such an amount is due from Borrower, a
calculation of the amount due, and a certification that the corresponding costs have been incurred
by the Lender. Borrower may replace such Lender by notifying such Lender, within five (5) Banking
Days after demand of such Lender, of Borrower’s intention to replace such Lender and Borrower shall
then replace such Lender by causing such Lender to assign its Commitments to one or more other
then-existing Lenders or to another Eligible Assignee reasonably satisfactory to the Administrative
Agent and the other then-existing Lenders within forty-five (45) days after demand of such Lender.




     3.7 Late Payments. If any installment of principal or interest or any fee or cost or
other amount payable under any Loan Document to the Administrative Agent or any Lender is not paid
when due, it shall thereafter bear interest at the Default Rate to the fullest extent permitted by
applicable Laws. Accrued and unpaid interest on past due amounts (including, without
limitation, interest on past due interest) shall be compounded monthly, on the last day of each
calendar month, to the fullest extent permitted by applicable Laws.



     3.8 Computation of Interest and Fees. Computation of interest and fees under this
Agreement shall be calculated on the basis of a year of 360 days and the actual number of days
elapsed. Interest shall accrue on each Loan for the day on which the Loan is made; interest shall
not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is
paid. Any Loan that is repaid on the same day on which it is made shall bear interest for one day.
Notwithstanding anything in this Agreement to the contrary, interest in excess of the maximum
amount permitted by applicable Laws shall not accrue or be payable hereunder or under the Notes,
and any amount paid as interest hereunder or under the Notes which would otherwise be in excess of
such maximum permitted amount shall instead be treated as a payment of principal.



     3.9 Non-Banking Days. If any payment to be made by Borrower or any other Party under
any Loan Document shall come due on a day other than a Banking Day, payment shall instead be
considered due on the next succeeding Banking Day and the extension of time shall be reflected in
computing interest and fees.



     3.10 Manner and Treatment of Payments.



          (a) Each payment hereunder (except payments pursuant to Sections 3.5, 3.6,
11.3, 11.11 and 11.22) or on the Notes or under any other Loan Document
shall be made to the Administrative Agent at the Administrative Agent’s Office for the account of
each of the Lenders or the Administrative Agent, as the case may be, in immediately available funds
not later than 11:00 a.m. California time, on the day of payment (which must be a Banking Day).
All payments received after such time, on any Banking Day, shall be deemed received on the next
succeeding Banking Day. The amount of all payments received by the Administrative



38









 






Agent for the account of each Lender shall be immediately paid by the Administrative Agent to
the applicable Lender in immediately available funds and, if such payment was received by the
Administrative Agent by 11:00 a.m., California time, on a Banking Day and not so made available to
the account of a Lender on that Banking Day, the Administrative Agent shall reimburse that Lender
for the cost to such Lender of funding the amount of such payment at the Federal Funds Rate. All
payments shall be made in lawful money of the United States of America.




          (b) Borrower hereby authorizes the Administrative Agent to debit the general operating bank
account of Borrower to effect any payment due to the Lenders or the Administrative Agent pursuant
to this Agreement. Any resulting overdraft in such account shall be payable by Borrower to the
Administrative Agent on the next following Banking Day.




          (c) Except to the extent provided in Sections 3.5 and 3.6(f), each payment or
prepayment on account of any Loan shall be applied pro rata according to the outstanding Advances
made by each Lender comprising such Loan.




          (d) Each Lender shall use its best efforts to keep a record (in writing or by an electronic
data entry system) of Advances made by it and payments received by it with respect to each of its
Notes and, subject to Section 10.6(g). Such record shall, as against Borrower, be
presumptive evidence of the amounts owing. Notwithstanding the foregoing sentence, the failure by
any Lender to keep such a record shall not affect Borrower’s obligation to pay the Obligations.




          (e) Each payment of any amount payable by Borrower or any other Party under this Agreement or
any other Loan Document shall be made free and clear of, and without reduction by reason of, any
taxes, assessments or other charges imposed by any Governmental Agency, central bank or comparable
authority, excluding (i) taxes imposed on or measured in whole or in part by its overall
net income by (a) any jurisdiction (or political subdivision thereof) in which it is organized or
maintains its principal office or Eurodollar Lending Office or (b) any jurisdiction (or political
subdivision thereof) in which it is “doing business” and (ii) any withholding taxes or other taxes
based on gross income imposed by the United States of America for any period with respect to which
it has failed to provide Borrower with the appropriate form or forms required by Section
11.21, to the extent such forms are then required by applicable Laws (all such non-excluded
taxes, assessments or other charges being hereinafter referred to as “Taxes”). To the extent that
Borrower is obligated by applicable Laws to make any deduction or withholding on account of Taxes
from any amount payable to any Lender under this Agreement, Borrower shall (i) make such deduction
or withholding and pay the same to the relevant Governmental Agency and (ii) pay such additional
amount to that Lender as is necessary to result in that Lender’s receiving a net after-Tax amount
equal to the amount to which that Lender would have been entitled under this Agreement absent such
deduction or withholding. Borrower may replace such Lender by causing such Lender to assign its
Commitments to one or more other then-existing Lenders or to another Eligible Assignee reasonably
satisfactory to the Administrative Agent and the other then-existing Lenders. If and when receipt
of such payment results in an excess payment or credit to that Lender on account of such Taxes,
that Lender shall promptly refund such excess to Borrower.




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     3.11 Funding Sources. Nothing in this Agreement shall be deemed to obligate any
Lender to obtain the funds for any Loan or Advance in any particular place or manner or to
constitute a representation by any Lender that it has obtained or will obtain the funds for any
Loan or Advance in any particular place or manner.



     3.12 Failure to Charge Not Subsequent Waiver. Any decision by the Administrative
Agent or any Lender not to require payment of any interest (including interest arising
under Section 3.7) fee, cost or other amount payable under any Loan Document, or to
calculate any amount payable by a particular method, on any occasion shall in no way limit or be
deemed a waiver of the Administrative Agent’s or such Lender’s right to require full payment of any
interest (including interest arising under Section 3.7), fee, cost or other amount payable
under any Loan Document, or to calculate an amount payable by another method that is not
inconsistent with this Agreement, on any other or subsequent occasion.



     3.13 Administrative Agent’s Right to Assume Payments Will be Made. Unless the
Administrative Agent shall have been notified by Borrower prior to the date on which any payment to
be made by Borrower hereunder is due that Borrower does not intend to remit such payment, the
Administrative Agent may, in its discretion, assume that Borrower has remitted such payment when so
due and the Administrative Agent may, in its discretion and in reliance upon such assumption, make
available to each Lender on such payment date an amount equal to such Lender’s share of such
assumed payment. If Borrower has not in fact remitted such payment to the Administrative Agent,
each Lender shall forthwith on demand repay to the Administrative Agent the amount of such assumed
payment made available to such Lender, together with interest thereon in respect of each day from
and including the date such amount was made available by the Administrative Agent to such Lender to
the date such amount is repaid to the Administrative Agent at the Federal Funds Rate.



     3.14 Fee Determination Detail. The Administrative Agent, and any Lender, shall
provide reasonable detail to Borrower regarding the manner in which the amount of any payment to
the Administrative Agent and the Lenders, or that Lender, under Article 3 has been
determined, concurrently with demand for such payment.



     3.15 Survivability. All of Borrower’s obligations under Sections 3.5 and
3.6 shall survive for the ninety (90) day period following the date on which the Commitment
is terminated and all Loans hereunder are fully paid, and Borrower shall remain obligated
thereunder for all claims under such Sections made by any Lender to Borrower prior to the
expiration of such period to the extent provided in such Sections.



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Article 4

REPRESENTATIONS AND WARRANTIES




     Borrower represents and warrants to the Lenders that:



     4.1 Existence and Qualification; Power; Compliance With Laws. Borrower is a
corporation duly formed, validly existing and in good standing under the Laws of Delaware.
Borrower is duly qualified or registered to transact business and is in good standing in California
and each other jurisdiction in which the conduct of its business or the ownership or leasing of its
Properties makes such qualification or registration necessary, except where the failure so
to qualify or register and to be in good standing would not constitute a Material Adverse Effect.
Borrower has all requisite power and authority to conduct its business, to own and lease its
Properties and to execute and deliver each Loan Document to which it is a Party and to perform its
Obligations. The chief executive offices of Borrower are located in California. All outstanding
shares of capital stock of Borrower are duly authorized, validly issued, fully paid and
non-assessable, and no holder thereof has any enforceable right of rescission under any applicable
state or federal securities Laws. Borrower is in compliance with all Laws and other legal
requirements applicable to its business, has obtained all authorizations, consents, approvals,
orders, licenses and permits from, and has accomplished all filings, registrations and
qualifications with, or obtained exemptions from any of the foregoing from, any Governmental Agency
that are necessary for the transaction of its business, except where the failure so to comply,
obtain authorizations, etc., file, register, qualify or obtain exemptions does not constitute a
Material Adverse Effect.



     4.2 Authority; Compliance With Other Agreements and Instruments and Government
Regulations. The execution, delivery and performance by Borrower and the Subsidiary Guarantors
of the Loan Documents to which it is a Party have been duly authorized by all necessary corporate
action, and do not and will not:



          (a) Require any consent or approval not heretofore obtained of any partner, director,
stockholder, security holder or creditor of such Party;




          (b) Violate or conflict with any provision of such Party’s charter, articles of incorporation
or bylaws, as applicable;




          (c) Result in or require the creation or imposition of any Lien (other than pursuant
to the Loan Documents) or Right of Others (other than Permitted Rights of Others) upon or
with respect to any Property now owned or leased or hereafter acquired by such Party;




          (d) Violate any Requirement of Law applicable to such Party in any respect that constitutes a
Material Adverse Effect;




          (e) Result in a breach of or constitute a default under, or cause or permit the acceleration
of any obligation owed under, any indenture or loan or credit agreement or any other Contractual
Obligation to which such Party is a party or by which such Party or any of its Property is bound or
affected in any respect that constitutes a Material Adverse Effect; and such Party is not in
violation of, or default under, any Requirement of Law or Contractual Obligation,



41









 






or any indenture, loan or credit agreement described in Section 4.2(e), in any respect
that constitutes a Material Adverse Effect.




     4.3 No Governmental Approvals Required. Except as previously obtained or made, no
authorization, consent, approval, order, license or permit from, or filing, registration or
qualification with, any Governmental Agency is or will be required to authorize or permit under
applicable Laws the execution, delivery and performance by Borrower or any Subsidiary Guarantor of
the Loan Documents to which it is a Party (except where the failure to do so does not constitute a
Material Adverse Effect).



     4.4 Subsidiaries.



          (a) Schedule 4.4 hereto correctly sets forth the names, form of legal entity, number
of shares of capital stock issued and outstanding, number of shares owned by Borrower or a
Subsidiary of Borrower (specifying such owner) and jurisdictions of organization of all
Subsidiaries of Borrower as of the Closing Date and specifies which thereof, as of the Closing
Date, are not conducting any business or operations. Except as described in Schedule 4.4.
Borrower does not own any capital stock, equity interest or debt security which is convertible, or
exchangeable, for capital stock or equity interest in any Person. Unless otherwise indicated in
Schedule 4.4. all of the outstanding shares of capital stock, or all of the units of
equity interest, as the case may be, of each Subsidiary are owned of record and beneficially by
Borrower, there are no outstanding options, warrants or other rights to purchase capital stock of
any such Subsidiary, and all such shares or equity interests so owned are duly authorized, validly
issued, fully paid and non-assessable, and were issued in compliance with all applicable state and
federal securities and other Laws, and are free and clear of all Liens, except for
Permitted Encumbrances and other Liens permitted under Section 6.9.




          (b) Each Subsidiary listed in Schedule 4.4 is a legal entity of the type described in
Schedule 4.4 duly formed, validly existing and in good standing under the Laws of its
jurisdiction of organization, is duly qualified to do business as a foreign organization and is in
good standing as such in each jurisdiction in which the conduct of its business or the ownership or
leasing of its Properties makes such qualification necessary (except where the failure to
be so duly qualified and in good standing does not constitute a Material Adverse Effect), and has
all requisite power and authority to conduct its business and to own and lease its Properties.




          (c) Each Subsidiary is in compliance with all Laws and other requirements applicable to its
business and has obtained all authorizations, consents, approvals, orders, licenses, and permits
from, and each such Subsidiary has accomplished all filings, registrations, and qualifications
with, or obtained exemptions from any of the foregoing from, any Governmental Agency that are
necessary for the transaction of its business, except where the failure to be in such compliance,
obtain such authorizations, consents, approvals, orders, licenses, and permits, accomplish such
filings, registrations, and qualifications, or obtain such exemptions, does not constitute a
Material Adverse Effect.




     4.5 Financial Statements. Borrower has furnished to the Lenders (a) the audited
financial statements of Borrower for the Fiscal Year ended March 28, 2008 and (b) the unaudited
balance sheet and statement of operations of Borrower for the three-month period ended June 27,



42









 




2008. The financial statements described in clause (a) fairly present in all material
respects the financial condition, results of operations and changes in financial position, and the
balance sheet and statement of operations described in clause (b) except as indicated in the notes
thereto, fairly present in all material respects the financial condition and results of operations
of Borrower as of such dates and for such periods in conformity with GAAP consistently applied,
subject only to normal year-end accruals and audit adjustments.




     4.6 No Other Liabilities; No Material Adverse Changes. As of the Closing Date,
Borrower and its Subsidiaries do not have any material liability or material contingent liability
required under GAAP to be reflected or disclosed, and not reflected or disclosed, in the balance
sheet described in Section 4.5(b), other than liabilities and contingent
liabilities arising in the ordinary course of business since the date of such financial statements.
Except as set forth on Schedule 4.6, as of the Closing Date, no circumstance or event has
occurred that constitutes a Material Adverse Effect since June 27, 2008.



     4.7 Intentionally Deleted.



     4.8 Intangible Assets. Borrower and its Subsidiaries own, or possess the right to use
to the extent necessary in their respective businesses, all material trademarks, trade names,
copyrights, patents, patent rights, computer software, licenses and other Intangible Assets that
are used in the conduct of their businesses as now operated, and no such Intangible Asset, to the
best knowledge of Borrower, conflicts with the valid trademark, trade name, copyright, patent,
patent right or Intangible Asset of any other Person to the extent that such conflict constitutes a
Material Adverse Effect. Except as set forth in Schedule 4.8, Borrower has not
used any trade name, trade style or “dba” during the five year period ending on the Closing Date.



     4.9 Intentionally Deleted.



     4.10 Litigation. Except for (a) any matter fully covered as to subject matter and
amount (subject to applicable deductibles and retentions) by insurance for which the insurance
carrier has not asserted lack of subject matter coverage or reserved its right to do so, (b) any
matter, or series of related matters, involving a claim against Borrower or any of its Subsidiaries
of less than $5,000,000, (c) matters of an administrative nature not involving a claim or charge
against Borrower or any of its Subsidiaries and (d) matters set forth in Schedule 4.10,
there are no actions, suits, proceedings or investigations pending as to which Borrower or any of
its Subsidiaries have been served or have received notice or, to the best knowledge of Borrower,
threatened against or affecting Borrower or any of its Subsidiaries or any Property of any of them
before any Governmental Agency which could reasonably be expected to have a Material Adverse
Effect.



     4.11 Binding Obligations. Each of the Loan Documents to which Borrower and any
Subsidiary Guarantor is a Party will, when executed and delivered by such Party, constitute the
legal, valid and binding obligation of such Party, enforceable against such Party in accordance
with its terms, except as enforcement may be limited by Debtor Relief Laws or equitable
principles relating to the granting of specific performance and other equitable remedies as a
matter of judicial discretion.



43









 





     4.12 No Default. No event has occurred and is continuing that is a Default or Event
of Default.



     4.13 ERISA.




     (a) With respect to each Pension Plan:




               (i) such Pension Plan complies in all material respects with ERISA and any
other applicable Laws to the extent that noncompliance constitutes a Material
Adverse Effect;




               (ii) such Pension Plan has not incurred any “accumulated funding deficiency”
(as defined in Section 302 of ERISA) that constitutes a Material Adverse Effect;




               (iii) no “reportable event” (as defined in Section 4043 of ERISA, but excluding
such events as to which the PBGC has by regulation waived the requirement therein
contained that it be notified within thirty days of the occurrence of such event)
has occurred that constitutes a Material Adverse Effect; and




               (iv) neither Borrower nor any of its Subsidiaries has engaged in any non-exempt
“prohibited transaction” (as defined in Section 4975 of the Code) that constitutes a
Material Adverse Effect.



          (b) Neither Borrower nor any of its Subsidiaries has incurred or expects .to incur any
withdrawal liability to any Multiemployer Plan that constitutes a Material Adverse Effect.




     4.14 Regulation U; Investment Company Act. No part of the proceeds of any Loan
hereunder will be used to purchase or carry, or to extend credit to others for the purpose of
purchasing or carrying, any Margin Stock in violation of Regulation U. Neither Borrower nor any of
its Subsidiaries is or is required to be registered as an “investment company” under the Investment
Company Act of 1940.



     4.15 Disclosure. No written agreement, documents, certificates, statements or other
correspondence made or executed by a Senior Officer and delivered, provided or otherwise made
available to the Administrative Agent or any Lender in connection with this Agreement, or in
connection with any Loan, as of the date thereof contained any untrue statement of a material fact
or omitted a material fact necessary to make the statement made not misleading in light of all the
circumstances existing at the date the statement was made.



     4.16 Tax Liability. Borrower and its Subsidiaries have filed all tax returns which
are required to be filed, and have paid, or made provision for the payment of, all taxes with
respect to the periods, Property or transactions covered by said returns, or pursuant to any
assessment received by Borrower or any of its Subsidiaries, except (a) such taxes, if any,
as are being contested in good faith by appropriate proceedings and as to which adequate reserves
have been



44









 




established and maintained and (b) immaterial taxes so long as no material Property of
Borrower or any of its Subsidiaries is at impending risk of being seized, levied upon or forfeited.




     4.17 Projections. As of the Closing Date, to the best knowledge of Borrower, the
assumptions set forth in the Projections are reasonable and consistent with each other and with all
facts known to Borrower, and the Projections are reasonably based on such assumptions. Nothing in
this Section 4.17 shall be construed as a representation or covenant that the Projections
in fact will be achieved.



     4.18 Hazardous Materials. Except as described in Schedule 4.18, (a) neither
Borrower nor any of its Subsidiaries at any time has disposed of, discharged, released or
threatened the release of any Hazardous Materials on, from or under the Real Property in violation
of any Hazardous Materials Law that would individually or in the aggregate constitute a Material
Adverse Effect, (b) to the best knowledge of Borrower, no condition exists that violates any
Hazardous Material Law affecting any Real Property except for such violations that would not
individually or in the aggregate constitute a Material Adverse Effect, (c) no Real Property or any
portion thereof is or has been utilized by Borrower or any of its Subsidiaries as a site for the
manufacture of any Hazardous Materials and (d) to the extent that any Hazardous Materials are used,
generated or stored by Borrower or any of its Subsidiaries on any Real Property, or transported to
or from such Real Property by Borrower or any of its Subsidiaries, such use, generation, storage
and transportation are in compliance with all Hazardous Materials Laws except for such
non-compliance that would not constitute a Material Adverse Effect or be materially adverse to the
interests of the Lenders.



     4.19 Security Interests. Except as otherwise provided in the Security Agreement, (a)
upon the execution and delivery of the Security Agreement, the Security Agreement will create a
valid first priority security interest in the Collateral described therein securing the Obligations
(subject only to Permitted Encumbrances, Permitted Rights of Others and other matters permitted by
Section 6.9 and to such qualifications and exceptions as are contained in the Uniform
Commercial Code with respect to the priority of security interests perfected by means other
than the filing of a financing statement or with respect to the creation of security interests
in Property to which Division 9 of the Uniform Commercial Code does not apply), and (b) all actions
necessary to perfect the security interests so created, other than the filing of any
required UCC-1 financing statement with the appropriate Governmental Agency, have been taken and
completed.



     4.20 Solvency. After giving effect to this Agreement and the other Loan Documents
(including after giving effect to the initial Advances under this Agreement), Borrower will be
Solvent.



     4.21 OFAC. Borrower (i) is not a person whose property or interest in property is
blocked or subject to blocking pursuant to Section 1 of Executive Order 13224 of September 23, 2001
Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or
Support Terrorism (66 Fed. Reg. 49079 (2001)), (ii) does not engage in any dealings or transactions
prohibited by Section 2 of such executive order, or is otherwise associated with any such person in
any manner violative of such Section 2, or (iii) is not a person on the list of Specially
Designated Nationals and Blocked Persons or subject to the limitations or prohibitions



45









 




under any other U.S. Department of Treasury’s Office of Foreign Assets Control regulation or
executive order.




     4.22 Patriot Act. Borrower and each Subsidiary is in compliance, in all material
respects, with the (i) the Trading with the Enemy Act, as amended, and each of the foreign assets
control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as
amended) and any other enabling legislation or executive order relating thereto, and (ii) the
Uniting And Strengthening America By Providing Appropriate Tools Required To Intercept And Obstruct
Terrorism (USA Patriot Act of 2001). No part of the proceeds of the Loans will be used, directly
or indirectly, for any payments to any governmental official or employee, political party, official
of a political party, candidate for political office, or anyone else acting in an official
capacity, in order to obtain, retain or direct business or obtain any improper advantage, in
violation of the United Stats Foreign Corrupt Practices Act of 1977, as amended.



46









 





Article 5

AFFIRMATIVE COVENANTS




(OTHER THAN INFORMATION AND REPORTING REQUIREMENTS)




     So long as any Advance remains unpaid, or any other Obligation remains unpaid, or any portion
of the Commitment remains in force, Borrower shall, and shall cause its Subsidiaries to, unless the
Administrative Agent (with the written approval of the Requisite Lenders) otherwise consents:



     5.1 Payment of Taxes and Other Potential Liens. Pay and discharge promptly all taxes,
assessments and governmental charges or levies imposed upon any of them, upon their respective
Property or any part thereof and upon their respective income or profits or any part thereof,
except that Borrower and its Subsidiaries shall not be required to pay or cause to be paid
(a) any tax, assessment, charge or levy that is not yet past due, or is being contested in good
faith by appropriate proceedings so long as the relevant entity has established and maintains
adequate reserves for the payment of the same or (b) any immaterial tax so long as no material
Property of Borrower or its Subsidiaries is at impending risk of being seized, levied upon or
forfeited.



     5.2 Preservation of Existence. Preserve and maintain their respective existences in
the jurisdiction of their formation and all material authorizations, rights, franchises,
privileges, consents, approvals, orders, licenses, permits, or registrations from any Governmental
Agency that are necessary for the transaction of their respective business and qualify and remain
qualified to transact business in each jurisdiction in which such qualification is necessary in
view of their respective business or the ownership or leasing of their respective Properties except
in each such case (a) a merger permitted by Section 6.3 or as otherwise permitted by this
Agreement and (b) where the failure to do so would not constitute a Material Adverse Effect.
Notwithstanding the foregoing, Borrower may liquidate any Subsidiary that does not constitute a
Significant Subsidiary if such liquidation would not have a Material Adverse Effect.



     5.3 Maintenance of Properties. Maintain, preserve and protect all of their respective
Properties in good order and condition, subject to wear and tear in the ordinary course of
business, and not permit any waste of their respective Properties, except that the failure
to maintain, preserve and protect a particular item of Property that is at the end of its useful
life or that is not of significant value, either intrinsically or to the operations of Borrower,
shall not constitute a violation of this covenant.



     5.4 Maintenance of Insurance. Maintain liability, casualty, workers’ compensation and
other insurance (subject to customary deductibles and retentions) with responsible insurance
companies in such amounts and against such risks as is carried by responsible companies engaged in
similar businesses and owning similar assets in the general areas in which Borrower and its
Subsidiaries operate. Schedule 5.4 lists all insurance of any nature maintained for
current occurrences by Borrower and each of its Subsidiaries, as well as a summary of the terms of
such insurance. Borrower shall deliver to Administrative Agent endorsements to all of its and its
Subsidiaries’ (a) “All Risk” and business interruption insurance policies naming Collateral Agent,
for the benefit of Collateral Agent and Lenders, as a loss payee, and (b) general liability and
other liability policies naming Collateral Agent, for the benefit of Collateral Agent and



47









 




Lenders, as an additional insured. All policies of insurance on real and personal property
will include an endorsement, in form and substance acceptable to Collateral Agent, showing loss
payable to Collateral Agent, for the benefit of Collateral Agent and Lenders, (Form 438 BFU or
equivalent) and extra expense and business interruption endorsements. Such endorsement, or an
independent instrument furnished to Collateral Agent, will provide that the insurer will give at
least 30 days’ prior written notice to Collateral Agent and Administrative Agent before any such
policy or policies of insurance shall be altered or canceled.




     5.5 Compliance With Laws. Comply with all Requirements of Law noncompliance with
which constitutes a Material Adverse Effect, except that Borrower and its Subsidiaries need
not comply with a Requirement of Law then being contested by any of them in good faith by
appropriate proceedings.



     5.6 Inspection Rights. Upon reasonable notice, at any time during regular business
hours and as often as reasonably requested (but not so as to materially interfere with the business
of Borrower or any of its Subsidiaries) permit the Administrative Agent, the Collateral Agent or
any Lender, or any authorized employee, agent or representative thereof, at their own cost and
expense prior to the occurrence of an Event of Default, to examine, audit and make copies and
abstracts from the records and books of account of, and to visit and inspect the Properties of,
Borrower and its Subsidiaries and to discuss the affairs, finances and accounts of Borrower and its
Subsidiaries with any of their officers, key employees, internal accountants and, following the
occurrence of an Event of Default, independent accountants. The Administrative Agent, the
Collateral Agent or any Lender, or any authorized employee, agent or representative shall (i)
comply with all sign-in procedures for visitors, (ii) observe all general and safety, security, and
governmental regulations in effect at the site, and (iii) observe all rules regarding restricted
areas and restricted information as required by the United States Department of Defense.



     5.7 Keeping of Records and Books of Account. Keep adequate records and books of
account reflecting all financial transactions in conformity with GAAP, consistently applied, and in
material conformity with all applicable requirements of any Governmental Agency having regulatory
jurisdiction over Borrower and its Subsidiaries.



     5.8 Compliance With Agreements. Promptly and fully comply with all Contractual
Obligations to which any one or more of them is a party, except for any such Contractual
Obligations (a) the performance of which would cause a Default or Event of Default or (b) then
being contested by any of them in good faith by appropriate proceedings or (c) if the failure to
comply does not constitute a Material Adverse Effect.



     5.9 Use of Proceeds. Use the proceeds of all Revolving Loans for working capital,
Investments in the ViaSat-1 Holding Companies, the ViaSat-1 Joint Venture, Joint Ventures (to the
extent permitted hereunder), Permitted Acquisitions, general corporate purposes of Borrower and/or
otherwise to the extent not prohibited under this Agreement.



     5.10 Hazardous Materials Laws. Keep and maintain all Real Property and each portion
thereof in compliance in all material respects with all applicable Hazardous Materials Laws, except
to the extent that no Material Adverse Effect could reasonably be expected to result therefrom, and
promptly notify the Administrative Agent in writing (attaching a copy of any



48









 




pertinent written material) of (a) any and all material enforcement, cleanup, removal or other
governmental or regulatory actions instituted, completed or threatened in writing by a Governmental
Agency pursuant to any applicable Hazardous Materials Laws, (b) any and all material claims made or
threatened in writing by any Person against Borrower relating to damage, contribution, cost
recovery, compensation, loss or injury resulting from any Hazardous Materials and (c) discovery by
any Senior Officer of any of Borrower of any material occurrence or condition on any real Property
adjoining or in the vicinity of such Real Property that could reasonably be expected to cause such
Real Property or any part thereof to be subject to any restrictions on the ownership, occupancy,
transferability or use of such Real Property under any applicable Hazardous Materials Laws.




     5.11 Syndication Process. Cooperate in such respects as may be reasonably requested
by the Arranger in connection with the syndication of the credit facilities under this Agreement,
including the provision of information (in form and substance acceptable to the Arranger
but subject to confidentiality provisions) for inclusion in written materials furnished to
prospective syndicate members and the participation by Senior Officers in meetings with prospective
syndicate members. Nothing in this Section 5.11 shall obligate Borrower to amend any Loan
Document.



     5.12 Future Subsidiaries; Additional Security Documentation. (a) Cause each future
Significant Domestic Subsidiary to execute and deliver to the Administrative Agent (i) an
appropriate joinder to the Subsidiary Guaranty and the Subsidiary Security Agreement and, as may
reasonably requested by the Administrative Agent, landlord/mortgagee waivers, and (ii) an opinion
of counsel from counsel and in form and substance reasonably acceptable to the Administrative
Agent, and (b) cause Borrower to pledge to the Administrative Agent pursuant to the Pledge
Agreement 65% of the capital stock or other equity interests of any Significant Foreign Subsidiary
formed or acquired after the Closing Date. In addition to the foregoing, except to the extent set
forth in the Security Agreement and/or the Subsidiary Security Agreement, respectively, Borrower
and its Significant Domestic Subsidiaries shall cause such documents and instruments as may be
reasonably requested by the Administrative Agent (or any Lender through the Administrative Agent)
from time to time to be executed and delivered and do such further acts and things as reasonably
may be required in order for the Administrative Agent, for the benefit of the Lenders, to obtain a
fully perfected first priority Lien on all Collateral, subject to Permitted Encumbrances, Permitted
Rights of Others and other matters permitted by Section 6.9. Notwithstanding the foregoing
or any other provision of this Agreement, ViaSat Satellite Ventures, LLC shall execute and deliver
to the Administrative Agent on the Closing Date a Subsidiary Guaranty, but shall not be required to
execute or deliver to the Administrative Agent a joinder to or the Subsidiary Security Agreement.



49









 





Article 6

NEGATIVE COVENANTS




     So long as any Advance remains unpaid, or any other Obligation remains unpaid, or any portion
of the Commitments remains in force, Borrower shall not, and shall not permit any of its
Subsidiaries to, unless the Administrative Agent (with the written approval of the Requisite
Lenders or, if required by Section 11.2, of all of the Lenders) otherwise consents:



     6.1 Payment of Subordinated Obligations. Pay any (a) principal (including
sinking fund payments) or any other amount (other than scheduled interest payments) with
respect to any Subordinated Obligation, or purchase or redeem (or offer to purchase or redeem) any
Subordinated Obligation, or deposit any monies, securities or other Property with any trustee or
other Person to provide assurance that the principal or any portion thereof of any Subordinated
Obligation will be paid when due or otherwise to provide for the defeasance of any Subordinated
Obligation or (b) scheduled interest on any Subordinated Obligation unless the payment thereof is
then permitted pursuant to the terms of the indenture or other agreement governing such
Subordinated Obligation.



     6.2 Disposition of Property. Make any Disposition of its Property, whether now owned
or hereafter acquired, except (a) a Disposition by Borrower to a Wholly-Owned Subsidiary
which is a Guarantor, or by a Subsidiary to Borrower or a Subsidiary (provided that any Disposition
by a Guarantor must be to another Guarantor or to Borrower), (b) a Disposition to any of the JV
Holding Companies or to the ViaSat-1 Joint Venture not to exceed, when aggregated with Investments
made pursuant to Section 6.16(n) and Capital Expenditures made pursuant to Section 6.17(ii), the
Maximum ViaSat-1 Joint Venture Investments at any time during the term hereof, and (c) a
Disposition for which the Net Cash Sales Proceeds do not exceed $10,000,000 (or when added to the
aggregate Net Cash Sales Proceeds of all Dispositions made during the term of this Agreement do not
exceed $20,000,000).



     6.3 Mergers. Merge or consolidate with or into any Person, except (a) mergers
and consolidations of a Subsidiary of Borrower into Borrower or a Wholly-Owned Subsidiary which is
a Guarantor, or of Subsidiaries with each other and (b) a merger or consolidation of a Person into
Borrower or with or into a Wholly-Owned Subsidiary of Borrower which constitutes a Permitted
Acquisition; provided that (i) Borrower is the surviving entity of any merger to which it
is a party, (ii) Guarantor is the surviving entity of any merger between a non-Guarantor and a
Guarantor, (iii) no Default or Event of Default then exists or would result therefrom and (iv)
Borrower and each of the Subsidiary Guarantors execute such amendments to the Loan Documents as the
Administrative Agent or the Collateral Agent may reasonably determine are appropriate as a result
of such merger in order to preserve the enforceability of the Loan Documents on the parties thereto
and their successors, if any, and except to the extent set forth in the Security Agreement and/or
the Subsidiary Security Agreement, maintain the perfection of the Administrative Agent’s Liens on
the Collateral.



     6.4 Hostile Acquisitions. Use the proceeds of any Loan in connection with the
acquisition of part or all of a voting interest of five percent (5%) or more in any corporation or
other business entity if such acquisition is opposed by the board of directors of such corporation
or business entity.



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     6.5 Acquisitions. Make any Acquisition other than a Permitted Acquisition.



     6.6 Distributions. Make any Distribution, whether from capital, income or otherwise,
and whether in Cash or other Property, except:



          (a) Distributions by any Subsidiary to Borrower or to any Wholly-Owned Subsidiary;




          (b) Distributions by any Subsidiary or Borrower for stock repurchases under any stock option
plan, not to exceed $5,000,000 in the aggregate in any fiscal year; and




          (c) stock dividends payable on Common Stock.




     6.7 ERISA. At any time, (a) permit any Pension Plan to: (i) engage in any non-exempt
“prohibited transaction” (as defined in Section 4975 of the Code); (ii) fail to comply with ERISA
or any other applicable Laws; (iii) incur any material “accumulated funding deficiency” (as defined
in Section 302 of ERISA); or (iv) terminate in any manner, which, with respect to each event listed
above, could reasonably be expected to result in a Material Adverse Effect or (b) withdraw,
completely or partially, from any Multiemployer Plan if to do so could reasonably be expected to
result in a Material Adverse Effect.



     6.8 Change in Nature of Business. Engage in any businesses other than the Permitted
Business.



     6.9 Liens. Create, incur, assume or suffer to exist any Lien of any nature upon or
with respect to any of their respective Properties, or engage in any sale and leaseback transaction
with respect to any of their respective Properties, whether now owned or hereafter acquired,
except:



          (a) Liens existing on the Closing Date and disclosed in Schedule 6.9 and any
renewals/extensions or amendments thereof, provided that the obligations secured or
benefited thereby are not increased;




          (b) Liens in favor of the Administrative Agent pursuant to the Security Agreement.




          (c) Permitted Encumbrances;




          (d) Liens on personal property acquired by Borrower or any of its Subsidiaries that were in
existence at the time of the acquisition of such Property and were not created in contemplation of
such acquisition;




          (e) Liens on real property acquired by Borrower or any of its Subsidiaries for use in the
business of Borrower or such Subsidiary;




          (f) Liens securing Indebtedness, in an aggregate outstanding principal amount at any time of
not more than $10,000,000, permitted by Section 6.10(d) on and limited to the



51









 






capital assets acquired, constructed or financed with the proceeds of such Indebtedness or
with the proceeds of any Indebtedness directly or indirectly refinanced by such Indebtedness;




          (g) Liens securing obligations of Borrower or any of its Subsidiaries under any Interest Rate
Protection Agreement with one of the Lenders or any Affiliate of a Lender at the time that Interest
Protection Agreement was entered into; and




          (h) Non-consensual Liens securing Indebtedness of not more than $10,000,000, provided
that such Liens are discharged within thirty (30) days after their incurrence by Borrower.




     6.10 Indebtedness and Guaranty Obligations. Create, incur or assume any Indebtedness
or Guaranty Obligation except:



          (a) Indebtedness and Guaranty Obligations existing on the Closing Date and disclosed in
Schedule 6.10, and refinancings, renewals, extensions or amendments that do not increase
the amount thereof;




          (b) Indebtedness and Guaranty Obligations under the Loan Documents;




          (c) Indebtedness and Guaranty Obligations owed to Borrower or any of its Subsidiaries in
connection with intercompany Indebtedness by Borrower or such Subsidiaries;




          (d) Indebtedness consisting of Capital Lease Obligations, or otherwise incurred to finance the
purchase or construction of property or assets (so long as (i) the Indebtedness incurred in any
such purchase shall not exceed one hundred percent (100%) of the purchase price of the property or
assets purchased and (ii) such Indebtedness shall be incurred concurrently with or within twelve
(12) months following the purchase or construction of such property or assets) or to refinance any
such Indebtedness, provided that the aggregate outstanding principal amount of such
Indebtedness does not exceed $10,000,000 at any time.




          (e) Indebtedness incurred to finance the purchase or construction of real property used in the
business of Borrower or any of its Subsidiaries;




          (f) Subordinated Obligations in such amount as may be approved in writing by the Requisite
Lenders, except as expressly provided in this Agreement;




          (g) Indebtedness consisting of debt securities for which the Net Cash Issuance Proceeds will
be applied as a mandatory prepayment pursuant to Section 3.1(f);




          (h) Indebtedness consisting of non-speculative Interest Rate Protection Agreements;




          (i) Guaranty Obligations in support of the obligations of a Wholly-Owned Subsidiary, provided
that such obligations are not prohibited by this Agreement;




          (j) Indebtedness of a Person acquired in a Permitted Acquisition which is outstanding at the
time of such acquisition; and




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          (k) Indebtedness or Guaranty Obligations incurred in connection with Investments permitted
under clause (m) of Section 6.16.




     6.11 Transactions with Affiliates. Enter into any transaction of any kind with any
Affiliate of Borrower other than (a) salary, bonus, employee stock option and other
compensation arrangements with directors or officers in the ordinary course of business, (b)
transactions that are fully disclosed to the board of directors (or committee thereof) of Borrower
and expressly authorized by a resolution of the board of directors (or committee) of Borrower which
is approved by a majority of the directors (or committee) not having an interest in the
transaction, (c) transactions between or among Borrower and its Subsidiaries and (d) transactions
on overall terms at least as favorable to Borrower or its Subsidiaries as would be the case in an
arm’s-length transaction between unrelated parties of equal bargaining power. Except as set forth
in Schedule 6.11, without limiting the generality of the preceding sentence, in no event
shall Borrower pay, or permit any of its Subsidiaries to pay, management fees or fees for services
(other than reimbursements to Borrower by its Subsidiaries of actual costs and allocable overhead),
in excess of $500,000 in the aggregate in any fiscal year, to any Affiliate of Borrower without the
prior written approval of the Administrative Agent.



     6.12 Negative Pledges. Agree with any Person other than Administrative Agent not to
grant a security interest in or otherwise encumber, any of its property, or covenant to any other
Person that Borrower or any Subsidiary Guarantor in the future will refrain from creating,
incurring, assuming or allowing any Lien with respect to any of Borrower’s or such Subsidiary
Guarantor’s property.



     6.13 Leverage Ratio. Permit the Leverage Ratio at any time, measured quarterly, to be
greater than 2.50 to 1.00.



     6.14 Interest Coverage Ratio. Permit the Interest Coverage Ratio at any time,
measured quarterly, to be less than 2.50 to 1.00.



     6.15 Intentionally Omitted.



     6.16 Investments. Make or suffer to exist any Investment, other than:



          (a) Investments in existence or committed on the Closing Date and disclosed on Schedule
6.16;




          (b) Investments consisting of Cash Equivalents;




          (c) Investments in a Person that is the subject of the Acquisition permitted by Section
6.5;




          (d) Investments consisting of advances to officers, directors and employees of a Borrower or
of any Subsidiary for travel, entertainment, relocation, anticipated bonus and analogous ordinary
business purposes;




          (e) Investments in a Domestic Subsidiary that is a Wholly-Owned Subsidiary;




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          (f) Investments in a Foreign Subsidiary that is a Wholly-Owned Subsidiary; provided
that the aggregate of all such Investments in all Foreign Subsidiaries in any Fiscal Year does not
exceed $15,000,000;




          (g) Investments consisting of the extension of credit to customers or suppliers of Borrower
and its Subsidiaries in the ordinary course of business and any Investments received in
satisfaction or partial satisfaction thereof;




          (h) Investments received in connection with the settlement of a bona fide dispute with another
Person;




          (i) Investments representing all or a portion of the sales price of Property sold or services
provided to another Person;




          (j) Investments by Foreign Subsidiaries in any other Subsidiary of a Borrower (whether a
Domestic Subsidiary or a Foreign Subsidiary);




          (k) Without duplication with (f), above, Investments in a Foreign Subsidiary that is a
Wholly-Owned Subsidiary for the purpose of Investments by such Foreign Subsidiary in Joint Ventures
and Investments in Joint Ventures; provided that the aggregate of all such Investments does
not exceed one and one-half (1.50) times Borrower’s consolidated trailing twelve month EBITDA as of
Borrower’s most recent Fiscal Quarter;




          (l) Investments not described above not in excess of $5,000,000 in any Fiscal Year;




          (m) without duplication with (g), above, Investments consisting of the extension of credit to
customers of Borrower and its Subsidiaries for the purpose of financing such customers’ purchases
of Borrower’s and/or its Subsidiaries’ products, not to exceed $10,000,000 in the aggregate at any
time during the term of this Agreement; and




          (n) Investments consisting of contributions of cash equivalents or other assets by Borrower or
its Subsidiaries to the JV Holding Companies and the ViaSat-1 Joint Venture not to exceed, when
aggregated with Dispositions made pursuant to 6.2(b) and Capital Expenditures made pursuant to
Section 6.17(ii), the Maximum ViaSat-1 Joint Venture Investments at any time during the term
hereof.




     6.17 Capital Expenditures. Make any Capital Expenditure in any Fiscal Year, if to do
so would cause the aggregate Capital Expenditures made in such Fiscal Year to exceed $40,000,000
(exclusive of (i) Capital Expenditures made in connection with Permitted Acquisitions and (ii)
Capital Expenditures regarding the JV Holding Companies and ViaSat-1 Joint Venture which, when
aggregated with Dispositions made pursuant to Section 6.2(b) and Investments made pursuant to
Section 6.16(n), do not exceed the Maximum ViaSat-1 Joint Venture Investments) at any time during
the term hereof.



     6.18 Amendments to Subordinated Obligations. Amend or modify any term or provision of
any indenture, agreement or instrument evidencing or governing any Subordinated Obligation in any
respect that will or may have a Material Adverse Effect.



54









 





     6.19 Changes in Officers, Name, Location of Chief Executive Offices, Etc. Without
providing notification to the Administrative Agent or the Collateral Agent, make any change in the
corporate name of Borrower, or without providing ten (10) calendar days prior written notice to the
Administrative Agent or the Collateral Agent, make any change in the location of Borrower’s
material assets, principal place of business or chief executive office.



55









 





Article 7

INFORMATION AND REPORTING REQUIREMENTS




     7.1 Financial and Business Information. So long as any Advance remains unpaid, or any
other Obligation remains unpaid, or any portion of the Commitments remains in force, Borrower
shall, unless the Administrative Agent (with the written approval of the Requisite Lenders)
otherwise consents, at Borrower’s sole expense, deliver to the Administrative Agent for
distribution by it to the Lenders, a sufficient number of copies for all of the Lenders of the
following:



          (a) As soon as practicable, and in any event within 45 days after the end of each Fiscal
Quarter (other than the fourth Fiscal Quarter in any Fiscal Year), the consolidated balance sheet
of Borrower and its Subsidiaries as at the end of such Fiscal Quarter and the consolidated
statements of operations and cash flows for such Fiscal Quarter, and the portion of the Fiscal Year
ended with such Fiscal Quarter, all in reasonable detail. Such financial statements shall be
certified by the chief financial officer of Borrower or his or her designated representative as
fairly presenting the financial condition, results of operations and cash flows of Borrower and its
Subsidiaries in accordance with GAAP (other than footnote disclosures), consistently applied, as at
such date and for such periods, subject only to normal year-end accruals and audit adjustments;




          (b) As soon as practicable, and in any event before the commencement of a Pricing Period, a
Pricing Certificate for such Pricing Period setting forth a calculation of the Leverage Ratio as of
the last day of the Fiscal Quarter immediately prior to such Pricing Period, and providing
reasonable detail as to the calculation thereof, which calculations in the case of the fourth
Fiscal Quarter in any Fiscal Year shall be based on the preliminary unaudited financial statements
of Borrower and its Subsidiaries for such Fiscal Quarter, and as soon as practicable thereafter, in
the event of any material variance in the actual calculation of the Leverage Ratio from such
preliminary calculation, a revised Pricing Certificate setting forth the actual calculation
thereof;




          (c) As soon as practicable, and in any event within 90 days after the end of each Fiscal Year,
the consolidated balance sheet of Borrower and its Subsidiaries as at the end of such Fiscal Year
and the consolidated statements of operations, stockholders’ equity and cash flows, in each case of
Borrower and its Subsidiaries for such Fiscal Year, all in reasonable detail. Such financial
statements shall be prepared in accordance with GAAP, consistently applied, and such consolidated
financial statements shall be accompanied by a report of PricewaterhouseCoopers LLP or other
independent public accountants of recognized standing selected by Borrower and reasonably
satisfactory to the Requisite Lenders, which report shall be prepared in accordance with generally
accepted auditing standards as at such date, and shall not be subject to any qualifications or
exceptions as to the scope of the audit nor to any other qualification or exception determined by
the Requisite Lenders in their good faith business judgment to be adverse to the interests of the
Lenders;




          (d) As soon as practicable, and in any event within 120 days after the end of each Fiscal
Year, a budget and projections by Fiscal Quarter for then-current Fiscal Year (the “First Year”)
and by Fiscal Year for each succeeding Fiscal Year through the Revolving Loan



56









 






Maturity Date (the “Succeeding Years”), including for the First Year, projected
consolidated balance sheets, statements of operations and statements of cash flow of Borrower and
its Subsidiaries, forecast assumptions, and a budget for Capital Expenditures, and, for the
Succeeding Years, projected consolidated condensed balance sheets and statements of operations and
cash flows of Borrower and its Subsidiaries, forecast assumptions, and a budget for Capital
Expenditures, all in reasonable detail;




          (e) Promptly after request by the Administrative Agent or any Lender, copies of any detailed
audit reports by independent accountants in connection with the accounts or books of Borrower or
any of its Subsidiaries, or any audit of any of them;




          (f) [Reserved.];




          (g) Promptly after request by the Administrative Agent or any Lender, copies of any other
report or other document that was filed by Borrower with any Governmental Agency, but excluding
such reports or documents as are filed with any Governmental Agency as part of Borrower’s ordinary
course transactions with any Governmental Agency;




          (h) Promptly upon a Senior Officer becoming aware, and in any event within five (5) Banking
Days after becoming aware, of the occurrence of any (i) “reportable event” (as such term is defined
in Section 4043 of ERISA, but excluding such events as to which the PBGC has by regulation
waived the requirement therein contained that it be notified within thirty days of the occurrence
of such event) or (ii) non-exempt “prohibited transaction” (as such term is defined in Section 406
of ERISA or Section 4975 of the Code) involving any Pension Plan or any trust created thereunder,
telephonic notice specifying the nature thereof, and, no more than two (2) Banking Days after such
telephonic notice, written notice again specifying the nature thereof and specifying what action
Borrower is taking or proposes to take with respect thereto, and, when known, any action taken by
the Internal Revenue Service with respect thereto;




          (i) As soon as practicable, and in any event within five (5) Banking Days after a Senior
Officer becomes aware of the existence of any condition or event which constitutes a Default or
Event of Default, telephonic notice specifying the nature and period of existence thereof, and, no
more than five (5) Banking Days after such telephonic notice, written notice again specifying the
nature and period of existence thereof and specifying what action Borrower is taking or proposes to
take with respect thereto;




          (j) Promptly upon a Senior Officer becoming aware that (i) any Person has commenced a legal
proceeding with respect to a claim against Borrower that is $10,000,000 or more in excess of the
amount thereof that is fully covered by insurance, (ii) any creditor under a credit agreement
involving Indebtedness of $5,000,000 or more or any lessor under a lease involving aggregate rent
of $5,000,000 or more has asserted a default thereunder on the part of Borrower or, (iii) any
Person has commenced a legal proceeding with respect to a claim against Borrower under a contract
that is not a credit agreement or material lease with respect to a claim of in excess of
$10,000,000 or which otherwise may reasonably be expected to result in a Material Adverse Effect, a
written notice describing the pertinent facts relating thereto and what action Borrower is taking
or proposes to take with respect thereto; and




57









 








          (k) Such other data and information as from time to time may be reasonably requested by the
Administrative Agent, the Collateral Agent, any Lender (through the Administrative Agent) or the
Requisite Lenders, to the extent reasonably available to Borrower.




     7.2 Intentionally Omitted.



     7.3 Compliance Certificates. So long as any Advance remains unpaid or any portion of
the Commitments remains outstanding, Borrower shall, at Borrower’s sole expense, deliver to the
Administrative Agent for distribution by it to the Lenders concurrently with the financial
statements required pursuant to Sections 7.1(a) and 7.1(c), a Compliance
Certificate signed by a Senior Officer or his or her designated representative.



     7.4 IntraLinks/IntraAgency. Reports required to be delivered pursuant to Sections
7.1(a) and 7.1(c) may be delivered electronically and if so, shall be deemed to
have been delivered on the date on which Borrower posts such reports, or provides a link thereto,
when such report is posted electronically on IntraLinks/IntraAgency, the Securities and Exchange
Commission’s EDGAR database, or other relevant website that each Lender and Administrative Agent
have access to (whether a commercial, third-party website or whether sponsored by the
Administrative Agent), if any, on Borrower’s behalf; provided, that: (a) Borrower shall deliver
paper copies of such reports to Administrative Agent or any Lender who requests Borrower to deliver
such paper copies until written request to cease delivering paper copies is given by Administrative
Agent or such Lender; (b) Borrower shall notify (which may be by facsimile or electronic mail)
Administrative Agent and each Lender of the posting of any such reports and immediately following
such notification Borrower shall provide to Administrative Agent, by electronic mail, electronic
versions (i.e., soft copies) of such reports ; and (c) in each instance Borrower shall provide
paper copies of the Compliance Certificates required by Section 7.2 to Administrative Agent.
Except for such Compliance Certificates, Administrative Agent shall have no obligation to request
the delivery of or to maintain copies of the reports referred to above, and in any event shall have
no responsibility to monitor compliance by Borrower with any such request for delivery, and each
Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such
reports.



58









 





Article 8

CONDITIONS




     8.1 Initial Credit Issuance. The obligation of each Lender to make the initial Credit
Issuance is subject to the following conditions precedent, each of which shall be satisfied prior
to the making of the initial Advances (unless all of the Lenders, in their sole and absolute
discretion, shall agree otherwise):



          (a) The Administrative Agent shall have received all of the following, each (other than the
documents referred to in clauses (7) and (9) below) properly executed by a Responsible Official of
each party thereto, each dated as of the Closing Date and each in form and substance satisfactory
to the Administrative Agent and its legal counsel (unless otherwise specified or, in the case of
the date of any of the following, unless the Administrative Agent otherwise agrees or directs):





     (1) at least one (1) executed counterpart of this Agreement, together with
arrangements satisfactory to the Administrative Agent for additional executed
counterparts, sufficient in number for distribution to the Lenders and Borrower;




     (2) Revolving Notes executed by Borrower in favor of each Lender, each in a
principal amount equal to that Lender’s Pro Rata Share of the Commitment;




     (3) the Security Agreement executed by Borrower;




     (4) [Intentionally Omitted]




     (5) the Subsidiary Guaranty executed by the Subsidiary Guarantors;




     (6) the Subsidiary Security Agreement executed by the Subsidiary Guarantors;




     (7) such financing statements on Form UCC-1 with respect to the Security
Agreement and the Subsidiary Security Agreement as the Collateral Agent may request;




     (8) with respect to Borrower and the Subsidiary Guarantors, such documentation
as the Administrative Agent may reasonably require to establish the due
organization, valid existence and good standing of Borrower and the Subsidiary
Guarantors, their qualification to engage in business in each material jurisdiction
in which they are engaged in business or required to be so qualified, their
authority to execute, deliver and perform the Loan Documents to which they are a
Party, the identity, authority and capacity of each Responsible Official thereof
authorized to act on their behalf, including certified copies of articles or
certificates of incorporation and amendments thereto, bylaws and amendments thereto,
certificates of good standing and/or qualification to engage in business,



59









 







tax clearance certificates, certificates of corporate resolutions, incumbency
certificates, Certificates of Responsible Officials, and the like;




     (9) the Opinion of Counsel;




     (10) a Certificate of Borrower, signed by the chief financial officer of
Borrower or his or her designated representative, certifying that, to the best of
his knowledge, the representation contained in Section 4.17 is, to the best
of his or her knowledge, true and correct;




     (11) a Certificate of Borrower, executed by the chief financial officer of
Borrower or his or her designated representative, certifying that the conditions
specified in Sections 8.1(e) and 8.1(f) have been satisfied; and




     (12) such other assurances, certificates, documents, consents or opinions as
the Administrative Agent, the Collateral Agent or the Requisite Lenders reasonably
may require.



          (b) The fees payable on the Closing Date pursuant to Section 3.2, shall have been
paid.




          (c) The Collateral Agent shall be reasonably satisfied that it holds (or has the reasonable
ability to hold) a first priority perfected Lien in the Collateral (except to the extent permitted
herein and except to the extent set forth in the Security Agreement and/or Subsidiary Security
Agreement), for the ratable benefit of the Lenders, subject only to Permitted Encumbrances and
Liens permitted in Section 6.9.




          (d) The reasonable costs and expenses of the Administrative Agent and the Collateral Agent in
connection with the preparation of the Loan Documents payable pursuant to Section 11.3, and
invoiced to Borrower prior to the Closing Date (if applicable), shall have been (or shall
concurrently be) paid.




          (e) The representations and warranties of Borrower contained in Article 4 shall be
true and correct in all material respects.




          (f) Borrower and any other Parties shall be in compliance in all material respects with all
the terms and provisions of the Loan Documents, and giving effect to the initial Credit Issuance,
no Default or Event of Default shall have occurred and be continuing.




          (g) All legal matters relating to the Loan Documents shall be reasonably satisfactory to DLA
Piper US LLP, counsel to the Administrative Agent.




     8.2 Any Advance. The obligation of each Lender to make any Advance, and the
obligation of the Issuing Lender to issue any Letter of Credit, is subject to the following
conditions precedent (unless the Requisite Lenders, in their reasonable discretion, shall agree
otherwise):



60









 





          (a) except (i) for representations and warranties which expressly speak as of a particular
date or are no longer true and correct as a result of a change which is permitted by this Agreement
or (ii) as disclosed by Borrower and approved in writing by the Requisite Lenders, the
representations and warranties contained in Article 4 (other than Sections
4.4, 4.6 (first sentence), 4.10 and 4.17) shall be true and correct
in all material respects on and as of the date of the Advance as though made on that date;




          (b) no circumstance or event shall have occurred since the Closing Date that constitutes a
Material Adverse Effect;




          (c) other than matters described in Schedule 4.10 or not required as of the Closing
Date to be therein described, there shall not be then pending or threatened any action, suit,
proceeding or investigation against or affecting Borrower or any of its Subsidiaries or any
Property of any of them before any Governmental Agency that constitutes a Material Adverse Effect;
and




          (d) the Administrative Agent shall have timely received a Request for Loan (or telephonic or
other request for Loan referred to in the second sentence of Section 2.1(c), if
applicable), or a Request for Letter of Credit (as applicable), in compliance with Article
2.




          (e) Borrower and any other Parties shall be in compliance in all material respects with all
the terms and provisions of the Loan Documents, and no Default or Event of Default shall have
occurred and be continuing.





61












 





Article 9

EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT




     9.1 Events of Default. The existence or occurrence of any one or more of the
following events, whatever the reason therefor and under any circumstances whatsoever, shall
constitute an Event of Default:



          (a) Borrower fails to pay any principal on any of the Notes, or any portion thereof, within
(2) Banking Days after the date when due; or




          (b) Borrower fails to pay any interest on any of the Notes, or any fees under Sections
3.3, 3.4 or 3.5, or any portion thereof, within two (2) Banking Days after the
date when due; or fails to pay any other fee or amount payable to the Lenders under any Loan
Document, or any portion thereof, within two (2) Banking Days after demand therefor, or




          (c) Borrower fails to comply with any of the covenants contained in Article 6 (other than
Sections 6.8, 6.11 or 6.16); or




          (d) Borrower fails to comply with Section 7.1(i) in any respect that has a Material
Adverse Effect and the related Default or Event of Default continues for longer than any applicable
cure or grace period permitted hereunder for such Default or Event of Default; or




          (e) Borrower or any other Party fails to perform or observe any other covenant or agreement
(not specified in clause (a), (b), (c) or (d) above) contained in any Loan Document
on its part to be performed or observed within twenty (20) Banking Days after the giving of notice
by the Administrative Agent on behalf of the Requisite Lenders of such Default or, if such Default
is not reasonably susceptible of cure within such period, within such longer period as is
reasonably necessary to effect a cure so long as such Borrower or such Party continues to
diligently pursue cure of such Default but not in any event in excess of forty (40) Banking Days;
or




          (f) Any representation or warranty of Borrower or any other Party made in any Loan Document,
or in any certificate or other writing delivered by Borrower or such Party pursuant to any Loan
Document, proves to have been incorrect when made or reaffirmed in any material respect; or




          (g) Borrower or any Subsidiary (i) fails to pay the principal, or any principal installment,
of any present or future Indebtedness in the aggregate amount of $5,000,000 or more, or any
guaranty of present or future Indebtedness in the aggregate amount of $5,000,000 or more, on its
part to be paid, when due (or within any stated grace period), whether at the stated maturity, upon
acceleration, by reason of required prepayment or otherwise or (ii) fails to perform or observe any
other term, covenant or agreement on its part to be performed or observed, or suffers any event of
default to occur, in connection with any present or future Indebtedness in the aggregate amount of
$5,000,000 or more, or of any guaranty of present or future Indebtedness in the aggregate amount of
$5,000,000 or more, if as a result of such failure or sufferance any holder or holders thereof (or
an agent or trustee on its or their behalf) has the right to declare such Indebtedness due before
the date on which it otherwise would become due



62









 






or the right to require Borrower or any Subsidiary to redeem or purchase, or offer to redeem
or purchase, all or any portion of such Indebtedness; or




          (h) Any Loan Document, at any time after its execution and delivery and for any reason
other than the agreement or action (or omission to act) of the Administrative Agent, the
Collateral Agent or the Lenders or satisfaction in full of all the Obligations, ceases to be in
full force and effect or is declared by a court of competent jurisdiction to be null and void,
invalid or unenforceable in any respect which has a Material Adverse Effect; or any Collateral
Document ceases (other than by action or inaction of the Collateral Agent or any Lender) to create
a valid and effective Lien in any material portion of the Collateral; or any Party thereto denies
in writing that it has any or further liability or obligation under any Loan Document, or purports
to revoke, terminate or rescind same; or




          (i) A final judgment against Borrower or any Subsidiary is entered for the payment of money in
excess of $10,000,000 in the aggregate (not covered by insurance or for which an insurer has
reserved its rights) and, absent procurement of a stay of execution, such judgment remains
unsatisfied for thirty (30) calendar days after the date of entry of judgment, or in any event
later than five (5) days prior to the date of any proposed sale thereunder; or any writ or warrant
of attachment or execution or similar process is issued or levied against all or any material part
of the Property of Borrower or any Subsidiary and is not released, vacated or fully bonded within
thirty (30) calendar days after its issue or levy; or




          (j) Borrower or any Subsidiary institutes or consents to the institution of any proceeding
under a Debtor Relief Law relating to it or to all or any material part of its Property, or is
unable or admits in writing its inability to pay its debts as they mature, or makes an assignment
for the benefit of creditors; or applies for or consents to the appointment of any receiver,
trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or
any material part of its Property; or any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer is appointed without the application or consent of that Person and
the appointment continues undischarged or unstayed for sixty (60) calendar days; or any proceeding
under a Debtor Relief Law relating to any such Person or to all or any part of its Property is
instituted without the consent of that Person and continues undismissed or unstayed for sixty (60)
calendar days; or




          (k) The occurrence of an Event of Default (as such term is or may hereafter be specifically
defined in any other Loan Document) under any other Loan Document; or




          (l) Any holder of a Subordinated Obligation of more than $5,000,000 asserts in writing that
such Subordinated Obligation is not subordinated to the Obligations in accordance with its terms
and Borrower does not promptly deny in writing such assertion and contest any attempt by such
holder to take action based on such assertion; or




          (m) Any Pension Plan maintained by Borrower is finally determined by the PBGC to have a
material “accumulated funding deficiency” as that term is defined in Section 302 of ERISA in excess
of an amount equal to 5% of the consolidated total assets of Borrower as of the most-recently ended
Fiscal Quarter, or




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          (n) A Change in Control occurs.




     9.2 Remedies Upon Event of Default. Without limiting any other rights or remedies of
the Administrative Agent, the Collateral Agent or the Lenders provided for elsewhere in this
Agreement, or the other Loan Documents, or by applicable Law, or in equity, or otherwise:



          (a) Upon the occurrence, and during the continuance, of any Event of Default other than an
Event of Default described in Section 9.1(j):





     (1) the Commitments to make Advances and all other obligations of the
Administrative Agent or the Lenders and all rights of Borrower and any other Parties
under the Loan Documents shall be suspended without notice to or demand upon
Borrower, which are expressly waived by Borrower, except that all of the
Lenders or the Requisite Lenders (as the case may be, in accordance with Section
11.2) may waive an Event of Default or, without waiving, determine, upon terms
and conditions satisfactory to the Lenders or Requisite Lenders, as the case may be,
to reinstate the Commitments and such other obligations and rights and make further
Advances, which waiver or determination shall apply equally to, and shall be binding
upon, all the Lenders;




     (2) the Issuing Lender may, with the approval of the Administrative Agent on
behalf of the Requisite Lenders, demand immediate payment by Borrower of an amount
equal to the aggregate amount of all outstanding Letters of Credit to be held by the
Issuing Lender in an interest-bearing cash collateral account as collateral
hereunder; and




     (3) the Requisite Lenders may request the Administrative Agent to, and the
Administrative Agent thereupon shall, terminate the Commitments and/or declare all
or any part of the unpaid principal of all Notes, all interest accrued and unpaid
thereon and all other amounts payable under the Loan Documents to be forthwith due
and payable, whereupon the same shall become and be forthwith due and payable,
without protest, presentment, notice of dishonor, demand or further notice of any
kind, all of which are expressly waived by Borrower.



          (b) Upon the occurrence of any Event of Default described in Section 9.1(j):





     (1) the Commitments to make Advances and all other obligations of the
Administrative Agent, the Collateral Agent or the Lenders and all rights of Borrower
and any other Parties under the Loan Documents shall terminate without notice to or
demand upon Borrower, which are expressly waived by Borrower, except that all of the
Lenders may waive the Event of Default or, without waiving, determine, upon terms
and conditions satisfactory to all the Lenders, to reinstate the Commitments and
such other obligations and rights and make further Advances, which determination
shall apply equally to, and shall be binding upon, all the Lenders;




     (2) an amount equal to the aggregate amount of all outstanding Letters of
Credit shall be immediately due and payable to the Issuing Lender without



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notice to or demand upon Borrower, which are expressly waived by Borrower, to
be held by the Issuing Lender in an interest-bearing cash collateral account as
collateral hereunder; and




     (3) the unpaid principal of all Notes, all interest accrued and unpaid thereon
and all other amounts payable under the Loan Documents shall be forthwith due and
payable, without protest, presentment, notice of dishonor, demand or further notice
of any kind, all of which are expressly waived by Borrower.



          (c) Upon the occurrence of any Event of Default, the Lenders, the Administrative Agent and the
Collateral Agent, or any of them, without notice to (except as expressly provided for in any Loan
Document) or demand upon Borrower, which are expressly waived by Borrower (except as to
notices expressly provided for in any Loan Document), may proceed (but only with the consent of the
Requisite Lenders) to protect, exercise and enforce their rights and remedies under the Loan
Documents against Borrower and any other Party and such other rights and remedies as are provided
by Law or equity.




          (d) The order and manner in which the Lenders’ rights and remedies are to be exercised shall
be determined by the Requisite Lenders in their sole discretion, and all payments received by the
Administrative Agent, the Collateral Agent and the Lenders, or any of them, shall be applied first
to the costs and expenses (including reasonable attorneys’ fees and disbursements and the
reasonably allocated costs of attorneys employed by the Administrative Agent, the Collateral Agent
or by any Lender) of the Administrative Agent, the Collateral Agent and the Lenders, and thereafter
paid pro rata to the Lenders in the same proportions that the aggregate Obligations owed to each
Lender under the Loan Documents bear to the aggregate Obligations owed under the Loan Documents to
all the Lenders, without priority or preference among the Lenders. Regardless of how each Lender
may treat payments for the purpose of its own accounting, for the purpose of computing Borrower’s
Obligations hereunder and under the Notes, payments shall be applied first, to the costs
and expenses of the Administrative Agent, the Collateral Agent and the Lenders, as set forth above,
second, to the payment of accrued and unpaid interest due under any Loan Documents to and
including the date of such application (ratably, and without duplication, according to the accrued
and unpaid interest due under each of the Loan Documents), and third to the payment of all
other amounts (including principal and fees) then owing to the Administrative Agent, the Collateral
Agent or the Lenders under the Loan Documents and/or on account of Bank Products. No application
of payments will cure any Event of Default (other than an Event of Default caused by a failure to
pay), or prevent acceleration, or continued acceleration, of amounts payable under the Loan
Documents, or prevent the exercise, or continued exercise, of rights or remedies of the Lenders
hereunder or thereunder or at Law or in equity.




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Article 10

THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT




     10.1 Appointment and Authorization. Subject to Section 10.8, each Lender hereby
irrevocably appoints and authorizes the Administrative Agent and the Collateral Agent to take such
action as agent on its behalf and to exercise such powers under the Loan Documents as are delegated
to the Administrative Agent or the Collateral Agent by the terms thereof or are reasonably
incidental, as determined by the Administrative Agent or the Collateral Agent, thereto. This
appointment and authorization is intended solely for the purpose of facilitating the servicing of
the Loans and the administration of the Collateral and does not constitute appointment of the
Administrative Agent or the Collateral Agent as trustee for any Lender or as representative of any
Lender for any other purpose and, except as specifically set forth in the Loan Documents to
the contrary, the Administrative Agent and the Collateral Agent shall take such action and exercise
such powers only in an administrative and ministerial capacity.



     10.2 The Agents and Their Affiliates. Union Bank (and each successor Administrative
Agent) and UNION BANK OF CALIFORNIA, N.A. (and each successor Collateral Agent) have the same
rights and powers under the Loan Documents as any other Lender and may exercise the same as though
they were not the Administrative Agent and the Collateral Agent, respectively, and the term
“Lender” or “Lenders” includes Union Bank and UNION BANK OF CALIFORNIA, N.A. in their individual
capacities. Union Bank (and each successor Administrative Agent) and UNION BANK OF CALIFORNIA,
N.A. (and each successor Collateral Agent) have and their respective Affiliates may accept deposits
from, lend money to and generally engage in any kind of banking, trust or other business with
Borrower, any Subsidiary thereof, or any Affiliate of Borrower or any Subsidiary thereof, as if
they were not the Administrative Agent and the Collateral Agent, respectively, and without any duty
to account therefor to the Lenders. Union Bank (and each successor Administrative Agent) and UNION
BANK OF CALIFORNIA, N.A. (and each successor Collateral Agent) need not account to any other Lender
for any monies received by them for reimbursement of their costs and expenses as Administrative
Agent or Collateral Agent hereunder, or (subject to Section 11.10) for any monies received by
them in their capacity as Lenders hereunder. Neither the Administrative Agent nor the Collateral
Agent shall be deemed to hold a fiduciary relationship with any Lender and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement
or otherwise exist against the Administrative Agent or the Collateral Agent.



     10.3 Proportionate Interest in any Collateral. The Collateral Agent, on behalf of all
the Lenders, shall hold in accordance with the Loan Documents all items of any collateral or
interests therein received or held by the Collateral Agent. Subject to the Collateral Agent’s, the
Administrative Agent’s and the Lenders’ rights to reimbursement for their costs and expenses
hereunder (including reasonable attorneys’ fees and disbursements and other professional services
and the reasonably allocated costs of attorneys employed by the Collateral Agent, the
Administrative Agent or a Lender) and subject to the application of payments in accordance with
Section 9.2(d), each Lender shall have an interest in the Lenders’ interest in such collateral
or interests therein in the same proportions that the aggregate Obligations owed such Lender under
the Loan Documents bear to the aggregate Obligations owed under the Loan Documents to all the
Lenders, without priority or preference among the Lenders.



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     10.4 Lenders’ Credit Decisions. Each Lender agrees that it has, independently and
without reliance upon the Administrative Agent, the Collateral Agent, any other Lender or the
directors, officers, agents, employees or attorneys of the Administrative Agent, the Collateral
Agent or of any other Lender, and instead in reliance upon information supplied to it by or on
behalf of Borrower and upon such other information as it has deemed appropriate, made its own
independent credit analysis and decision to enter into this Agreement. Each Lender also agrees
that it shall, independently and without reliance upon the Administrative Agent, the Collateral
Agent any other Lender or the directors, officers, agents, employees or attorneys of the
Administrative Agent, the Collateral Agent or of any other Lender, continue to make its own
independent credit analyses and decisions in acting or not acting under the Loan Documents.



     10.5 Action by Administrative Agent and Collateral Agent.



          (a) Absent actual knowledge of the Administrative Agent or the Collateral Agent of the
existence of a Default, the Administrative Agent and the Collateral Agent may assume that no
Default has occurred and is continuing, unless the Administrative Agent or the Collateral Agent (or
the Lender that is then the Administrative Agent or the Collateral Agent) has received notice from
Borrower stating the nature of the Default or has received notice from a Lender stating the nature
of the Default and that such Lender considers the Default to have occurred and to be continuing.




          (b) The Administrative Agent and the Collateral Agent have only those obligations under the
Loan Documents as are expressly set forth therein.




          (c) Except for any obligation expressly set forth in the Loan Documents and as long as
the Administrative Agent and the Collateral Agent may assume that no Event of Default has occurred
and is continuing, the Administrative Agent and the Collateral Agent may, but shall not be required
to, exercise its reasonable discretion to act or not act, except that the Administrative Agent and
the Collateral Agent shall be required to act or not act upon the instructions of the Requisite
Lenders (or of all the Lenders, to the extent required by Section 11.2) and those instructions
shall be binding upon the Administrative Agent, the Collateral Agent and all the Lenders,
provided that the Administrative Agent and the Collateral Agent shall not be required to
act or not act if to do so would be contrary to any Loan Document or to applicable Law or would
result, in the reasonable judgment of the Administrative Agent or the Collateral Agent, in
substantial risk of liability to the Administrative Agent or the Collateral Agent.




          (d) If the Administrative Agent or the Collateral Agent has received a notice specified in
clause (a), the Administrative Agent or the Collateral Agent shall immediately give notice
thereof to the Lenders and shall act or not act upon the instructions of the Requisite Lenders (or
of all the Lenders, to the extent required by Section 11.2), provided that the
Administrative Agent or the Collateral Agent shall not be required to act or not act if to do so
would be contrary to any Loan Document or to applicable Law or would result, in the reasonable
judgment of the Administrative Agent or the Collateral Agent, in substantial risk of liability to
the Administrative Agent or the Collateral Agent, and except that if the Requisite Lenders
(or all the Lenders, if required under Section 11.2) fail, for five (5) Banking Days after the
receipt of



67









 






notice from the Administrative Agent, to instruct the Administrative Agent or the
Collateral Agent, then
the Administrative Agent or the Collateral Agent, in its sole discretion, may act or not act
as it deems advisable for the protection of the interests of the Lenders.




          (e) The Administrative Agent and the Collateral Agent shall have no liability to any Lender
for acting, or not acting, as instructed by the Requisite Lenders (or all the Lenders, if required
under Section 11.2), notwithstanding any other provision hereof.




     10.6 Liability of Agents. Neither the Administrative Agent, the Collateral Agent, nor
any directors, officers, agents, employees or attorneys of the Administrative Agent or the
Collateral Agent shall be liable for any action taken or not taken by them under or in connection
with the Loan Documents, except for their own gross negligence or willful misconduct. Without
limitation on the foregoing, the Administrative Agent, the Collateral Agent and their respective
directors, officers, agents, employees and attorneys:



          (a) May treat the payee of any Note as the holder thereof until the Administrative Agent or
the Collateral Agent receives notice of the assignment or transfer thereof, in form satisfactory to
the Administrative Agent or the Collateral Agent, signed by the payee, and may treat each Lender as
the owner of that Lender’s interest in the Obligations for all purposes of this Agreement until the
Administrative Agent or the Collateral Agent receives notice of the assignment or transfer thereof,
in form satisfactory to the Administrative Agent or the Collateral Agent, signed by that Lender;




          (b) May consult with legal counsel (including in-house legal counsel), accountants
(including in-house accountants) and other professionals or experts selected by it, or with
legal counsel, accountants or other professionals or experts for Borrower and/or their Subsidiaries
or the Lenders, and shall not be liable for any action taken or not taken by it in good faith in
accordance with any reasonable advice of such legal counsel, accountants or other professionals or
experts selected by it with reasonable care;




          (c) Shall not be responsible to any Lender for any statement, warranty or representation made
in any of the Loan Documents or in any notice, certificate, report, request or other statement
(written or oral) given or made in connection with any of the Loan Documents except for those
expressly made by it;




          (d) Except to the extent expressly set forth in the Loan Documents, shall have no duty
to ask or inquire as to the performance or observance by Borrower or its Subsidiaries of any of the
terms, conditions or covenants of any of the Loan Documents or to inspect any collateral or any
Property, books or records of Borrower or its Subsidiaries;




          (e) Will not be responsible to any Lender for the due execution, legality, validity,
enforceability, genuineness, effectiveness, sufficiency or value of any Loan Document, any other
instrument or writing furnished pursuant thereto or in connection therewith, or any Collateral;




          (f) Will not incur any liability by acting or not acting in reliance upon any Loan Document,
notice, consent, certificate, statement, request or other instrument or writing reasonably believed
by it to be genuine and signed or sent by the proper party or parties; and




68









 








          (g) Will not incur any liability for any arithmetical error in computing any amount paid or
payable by Borrower or any Subsidiary or Affiliate thereof or paid or payable to or received or
receivable from any Lender under any Loan Document, including, without limitation,
principal, interest, commitment fees, Advances and other amounts: provided that such error
was not the result of gross negligence or willful misconduct and provided further that,
promptly upon discovery of such an error in computation, the Administrative Agent, the Collateral
Agent, the Lenders and (to the extent applicable) Borrower and/or its Subsidiaries or Affiliates
shall make such adjustments as are necessary to correct such error and to restore the parties to
the position that they would have occupied had the error not occurred.




     10.7 Indemnification. Each Lender shall, ratably in accordance with its Pro Rata
Share of the Commitments (if the Commitments are then in effect) or in accordance with its
proportion of the aggregate Indebtedness then evidenced by the Notes (if the Commitments have then
been terminated), indemnify and hold the Administrative Agent, the Collateral Agent and their
respective directors, officers, agents, employees and attorneys harmless against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever (including reasonable attorneys’ fees and
disbursements and allocated costs of attorneys employed by the Administrative Agent or the
Collateral Agent) that may be imposed on, incurred by or asserted against it or them in any way
relating to or arising out of the Loan Documents (other than losses incurred by reason of the
failure of Borrower to pay the Indebtedness represented by the Notes) or any action taken or not
taken by it as Administrative Agent or Collateral Agent thereunder, except such as result
from its own gross negligence or willful misconduct. Without limitation on the foregoing, each
Lender shall reimburse the Administrative Agent or Collateral Agent upon demand for that Lender’s
Pro Rata Share of any reasonable out-of-pocket cost or expense incurred by the Administrative Agent
or the Collateral Agent in connection with the negotiation, preparation, execution, delivery,
amendment, waiver, restructuring, reorganization (including a bankruptcy reorganization),
enforcement or attempted enforcement of the Loan Documents, to the extent that Borrower or any
other Party is required by Section 11.3 to pay that cost or expense but fails to do so upon
demand. Nothing in this Section 10.7 shall entitle the Administrative Agent, the Collateral
Agent or any indemnitee referred to above to recover any amount from the Lenders if and to the
extent that such amount has theretofore been recovered from Borrower or any of its Subsidiaries.
To the extent that the Administrative Agent, the Collateral Agent or any indemnitee referred to
above is later reimbursed such amount by Borrower or any of its Subsidiaries, it shall return the
amounts paid to it by the Lenders in respect of such amount.



     10.8 Successor Agents. The Administrative Agent and the Collateral Agent may, and at
the request of the Requisite Lenders shall, resign as Administrative Agent or Collateral Agent upon
reasonable notice to the Lenders and Borrower effective upon acceptance of appointment by a
successor Administrative Agent or Collateral Agent. If the Administrative Agent or Collateral
Agent shall resign as Administrative Agent or Collateral Agent under this Agreement, the Requisite
Lenders shall appoint from among the Lenders a successor Administrative Agent or Collateral Agent
for the Lenders, which successor Administrative Agent or Collateral Agent shall be approved by
Borrower (and such approval shall not be unreasonably withheld or delayed). If no successor
Administrative Agent or Collateral Agent is appointed prior to the effective date of the
resignation of the Administrative Agent or Collateral Agent, the Administrative Agent or Collateral
Agent may appoint, after consulting with the Lenders and



69









 







Borrower, a successor Administrative Agent or Collateral Agent from among the Lenders. Upon
the acceptance of its appointment as successor Administrative Agent or Collateral Agent hereunder,
such successor Administrative Agent or Collateral Agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent or Collateral Agent and the term “Administrative Agent”
or “Collateral Agent” shall mean such successor Administrative Agent or Collateral Agent and the
retiring Administrative Agent’s or Collateral Agent’s appointment, powers and duties as
Administrative Agent or Collateral Agent shall be terminated. After any retiring Administrative
Agent’s or Collateral Agent’s resignation hereunder as Administrative Agent or Collateral Agent,
the provisions of this Article 10, and Sections 11.3, 11.11 and 11.22, shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent
or Collateral Agent under this Agreement. Notwithstanding the foregoing, if (a) the Administrative
Agent or Collateral Agent has not been paid its agency fees under Section 3.4 or has not been
reimbursed for any expense reimbursable to it under Section 11.3, in either case for a period
of at least one (1) year and (b) no successor Administrative Agent or Collateral Agent has accepted
appointment as Administrative Agent or Collateral Agent by the date which is thirty (30) days
following a retiring Administrative Agent’s or Collateral Agent’s notice of resignation, the
retiring Administrative Agent’s or Collateral Agent’s resignation shall nevertheless thereupon
become effective and the Lenders shall perform all of the duties of the Administrative Agent or
Collateral Agent hereunder until such time, if any, as the Requisite Lenders appoint a successor
Administrative Agent or Collateral Agent as provided for above.



     10.9 No Obligations of Borrower. Nothing contained in this Article 10 shall be deemed
to impose upon Borrower any obligation in respect of the due and punctual performance by the
Administrative Agent or the Collateral Agent of its obligations to the Lenders under any provision
of this Agreement, and Borrower shall have no liability to the Administrative Agent, the Collateral
Agent or any of the Lenders in respect of any failure by the Administrative Agent, the Collateral
Agent or any Lender to perform any of its obligations to the Administrative Agent, the Collateral
Agent or the Lenders under this Agreement. Without limiting the generality of the foregoing, where
any provision of this Agreement relating to the payment of any amounts due and owing under the Loan
Documents provides that such payments shall be made by Borrower to the Administrative Agent for the
account of the Lenders, Borrower’s obligations to the Lenders .in respect of such payments shall be
deemed to be satisfied upon the making of such payments to the Administrative Agent in the manner
provided by this Agreement. In addition, Borrower may rely on a written statement by the
Administrative Agent to the effect that it has obtained the written consent of the Requisite
Lenders or all of the Lenders, as applicable under Section 11.2, in connection with a waiver,
amendment, consent, approval or other action by the Lenders hereunder, and shall have no obligation
to verify or confirm the same.



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Article 11

MISCELLANEOUS




     11.1 Cumulative Remedies: No Waiver. The rights, powers, privileges and remedies of
the Administrative Agent, the Collateral Agent and the Lenders provided herein or in any Note or
other Loan Document are cumulative and not exclusive of any right, power, privilege or remedy
provided by Law or equity. No failure or delay on the part of the Administrative Agent, Collateral
Agent or any Lender in exercising any right, power, privilege or remedy may be, or may be deemed to
be, a waiver thereof; nor may any single or partial exercise of any right, power, privilege or
remedy preclude any other or further exercise of the same or any other right, power, privilege or
remedy. The terms and conditions of Article 8 hereof are inserted for the sole benefit of the
Administrative Agent, the Collateral Agent and the Lenders; the same may be waived in whole or in
part, with or without terms or conditions, in respect of any Loan without prejudicing the
Administrative Agent’s or the Collateral Agent’s or the Lenders’ rights to assert them in whole or
in part in respect of any other Loan.



     11.2 Amendments; Consents. No amendment, modification, supplement, extension,
termination or waiver of any provision of this Agreement or any other Loan Document, no approval or
consent thereunder, and no consent to any departure by Borrower or any other Party therefrom, may
in any event be effective unless in writing signed by the Administrative Agent with the written
approval of the Requisite Lenders (and, in the case of any amendment, modification or supplement of
or to any Loan Document to which Borrower is a Party, signed by Borrower, and, in the case of any
amendment, modification or supplement to Article 10, signed by the Administrative Agent), and then
only in the specific instance and for the specific purpose given; and, without the approval in
writing of all the Lenders, no amendment, modification, supplement, termination, waiver or consent
may be effective:



          (a) To amend or modify the principal of, or the amount of principal, principal prepayments or
the rate of interest payable on, any Note, or the amount of the Commitments or (subject to the last
3 paragraphs of this Section 11.2) the Pro Rata Share of any Lender or the amount of any
commitment fee payable to any Lender, or any other fee or amount payable to any Lender under the
Loan Documents or to waive an Event of Default consisting of the failure of Borrower to pay when
due principal, interest or any fee;




          (b) To postpone any date fixed for any payment of principal of, prepayment of principal of or
any installment of interest on, any Note or any installment of any fee, or to extend the term of
the Commitments;




          (c) Except as set forth in the last paragraph of this Section 11.2, to amend the
provisions of the definition of “Requisite Lenders” or “Revolving Loan Maturity
Date”; or




          (d) To release any Subsidiary Guarantor from the Subsidiary Guaranty or to release all or
substantially all of the Collateral from the Lien of the Loan Documents; or




          (e) To amend or waive Section 8.1 or this Section 11.2; or




          (f) To amend any provision of this Agreement that expressly requires the consent or approval
of all or a specified portion of the Lenders.




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Any amendment, modification, supplement, termination, waiver or consent pursuant to this Section
11.2 shall apply equally to, and shall be binding upon, all the Lenders, the Administrative
Agent and the Collateral Agent.




     Notwithstanding anything to the contrary in this Section 11.2, this Agreement and any
other Loan Document may be amended, amended and restated, supplemented or otherwise modified with
the written consent of the Borrower and the Requisite Lenders to increase the aggregate Commitments
of the consenting Lenders and to permit the extensions of credit from time to time outstanding
thereunder and the accrued interest and fees in respect thereof to share ratably in the benefits of
this Agreement and other Loan Documents with the other then outstanding Obligations and to share
ratably in the benefits of the Collateral and guarantees and in prepayments and to include
appropriately the lenders holding such additional credit facilities in any determination of the
Requisite Lenders.



     Notwithstanding anything to the contrary in this Section 11.2, each of the
Administrative Agent and the Collateral Agent is authorized by the Lenders to enter into amendments
or supplements to this Agreement, or any other Loan Document to which it is a party, with the
Borrower or the applicable Subsidiary Guarantor for the purpose of curing any typographical error,
incorrect cross-reference, defect in form, inconsistency, omission or ambiguity herein or therein
(without any consent or approval by the Lenders).



     Notwithstanding anything to the contrary in this Section 11.2, (i) the Administrative
Agent, the Collateral Agent and the Borrower or applicable Subsidiary Guarantor may enter into
amendments, supplements or modifications to the Loan Documents or additional Loan Documents to
reflect additional Collateral provided under the Loan Documents or effect releases of Collateral or
guarantees permitted by the Loan Documents, or to take such further actions in respect of the
Security Documents as contemplated hereunder and thereunder and (ii) the Administrative Agent and
the Borrower may make amendments and supplements to the Loan Documents to add the New Lenders to
the Credit Agreement, including the definitions of “Requisite Lenders” and “Pro Rata Share.”



     11.3 Costs, Expenses and Taxes. Borrower shall pay within five (5) Banking Days after
demand, accompanied by an invoice therefor, the reasonable costs and expenses of the Administrative
Agent incurred in connection with the negotiation, preparation, syndication, execution and delivery
of the Loan Documents. Borrower shall also pay on demand, accompanied by an invoice therefor, the
reasonable costs and expenses of the Administrative Agent, the Collateral Agent, and the Lenders in
connection with each amendment of or waiver relating to the Loan Documents and in connection with
the refinancing, restructuring, reorganization (including a bankruptcy reorganization) and
enforcement or attempted enforcement of the Loan Documents, and any matter related thereto. The
foregoing costs and expenses shall include filing fees, recording fees, title insurance fees,
appraisal fees, search fees, and other out-of-pocket expenses, and the reasonable fees and
out-of-pocket expenses of any legal counsel (including reasonably allocated costs of legal
counsel employed by the Administrative Agent, the Collateral Agent, or any Lender), independent
public accountants and other outside experts retained by the Administrative Agent, the Collateral
Agent, or any Lender, whether or not such costs and expenses are incurred or suffered by the
Administrative Agent, the Collateral Agent, or any Lender in connection with or during the course
of any bankruptcy or



72









 







insolvency proceedings of Borrower or any of its Subsidiaries. Borrower shall pay any and all
documentary and other taxes, excluding (i) taxes imposed on or measured in whole or in part
by a Lender’s overall net income imposed on it by (a) any jurisdiction (or political subdivision
thereof) in which it is organized or maintains its principal office or Eurodollar Lending Office or
(b) any jurisdiction (or political subdivision thereof) in which it is “doing business” or (ii) any
withholding taxes or other taxes based on gross income imposed by the United States of America for
any period with respect to which it has failed to provide Borrower with the appropriate form or
forms required by Section 11.21, to the extent such forms are then required by applicable Laws,
and all costs, expenses, fees and charges payable or determined to be payable in connection with
the filing or recording of this Agreement, any other Loan Document or any other instrument or
writing to be delivered hereunder or thereunder, or in connection with any transaction pursuant
hereto or thereto, and shall reimburse, hold harmless and indemnify on the terms set forth in
11.11 the Administrative Agent, the Collateral Agent, and the Lenders from and against any
and all loss, liability or legal or other expense with respect to or resulting from any delay in
paying or failure to pay any such tax, cost, expense, fee or charge or that any of them may suffer
or incur by reason of the failure of Borrower or any Subsidiary Guarantor to perform any of its
Obligations. Any amount payable to the Administrative Agent, the Collateral Agent, or any Lender
under this Section 11.3 shall bear interest from the fifth Banking Day following the date of
demand for payment at the Default Rate. This Section 11.3 shall survive termination of
this Agreement.



     11.4 Nature of Lenders’ Obligations. The obligations of the Lenders hereunder are
several and not joint or joint and several. Nothing contained in this Agreement or any other Loan
Document and no action taken by the Administrative Agent, the Collateral Agent, or the Lenders or
any of them pursuant hereto or thereto may, or may be deemed to, make the Lenders a partnership, an
association, a joint venture or other entity, either among themselves or with the Borrower or any
Affiliate of Borrower. A default by any Lender will not increase the Pro Rata Share of the
Commitments attributable to any other Lender. Any Lender not in default may, if it desires, assume
in such proportion as the nondefaulting Lenders agree the obligations of any Lender in default, but
is not obligated to do so. The Administrative Agent agrees that it will use its best efforts
either to induce promptly the other Lenders to assume the obligations of a Lender in default or to
obtain promptly another Lender, reasonably satisfactory to Borrower, to replace such a Lender in
default.



     11.5 Survival of Representations and Warranties. All representations and warranties
contained herein or in any other Loan Document, or in any certificate or other writing delivered by
or on behalf of any one or more of the Parties to any Loan Document, will survive the making of the
Loans hereunder and the execution and delivery of the Notes, and have been or will be relied upon
by the Administrative Agent, the Collateral Agent, and each Lender, notwithstanding any
investigation made by the Administrative Agent, the Collateral Agent, or any Lender or on their
behalf.



     11.6 Notices. Except as otherwise expressly provided in the Loan Documents,
all notices, requests, demands, directions and other communications provided for hereunder or under
any other Loan Document must be in writing and must be mailed, telegraphed, telecopied, dispatched
by commercial courier or delivered to the appropriate party at the address set forth on the
signature pages of this Agreement or other applicable Loan Document or, as to any party to



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any Loan Document, at any other address as may be designated by it in a written notice sent to
all other parties to such Loan Document in accordance with this Section. Except as
otherwise expressly provided in any Loan Document, if any notice, request, demand, direction or
other communication required or permitted by any Loan Document is given by mail it will be
effective on the earlier of receipt or the fourth Banking Day after deposit in the United States
mail with first class or airmail postage prepaid; if given by telegraph or cable, when delivered to
the telegraph company with charges prepaid; if given by telecopier, when sent; if dispatched by
commercial courier, on the scheduled delivery date; or if given by personal delivery, when
delivered.



     11.7 Execution of Loan Documents. Unless the Administrative Agent otherwise specifies
with respect to any Loan Document, (a) this Agreement and any other Loan Document may be executed
in any number of counterparts and any party hereto or thereto may execute any counterpart, each of
which when executed and delivered will be deemed to be an original and all of which counterparts of
this Agreement or any other Loan Document, as the case may be, when taken together will be deemed
to be but one and the same instrument and (b) execution of any such counterpart may be evidenced by
a telecopier transmission of the signature of such party. The execution of this Agreement or any
other Loan Document by any party hereto or thereto will not become effective until counterparts
hereof or thereof, as the case may be, have been executed by all the parties hereto or thereto.



     11.8 Binding Effect; Assignment.



          (a) This Agreement and the other Loan Documents to which Borrower is a Party will be binding
upon and inure to the benefit of Borrower, the Administrative Agent, the Collateral Agent, each of
the Lenders, and their respective successors and assigns, except that Borrower may not
assign its rights hereunder or thereunder or any interest herein or therein without the prior
written consent of all the Lenders. Each Lender represents that it is not acquiring its Note with
a view to the distribution thereof within the meaning of the Securities Act of 1933, as amended
(subject to any requirement that disposition of such Note must be within the control of such
Lender). Any Lender may at any time pledge its Note or any other instrument evidencing its rights
as a Lender under this Agreement to a Federal Reserve Bank, but no such pledge shall release that
Lender from its obligations hereunder or grant to such Federal Reserve Bank the rights of a Lender
hereunder absent foreclosure of such pledge.




          (b) From time to time following the Closing Date, each Lender may assign to one or more
Eligible Assignees all or any portion of its Pro Rata Share of the Commitments; provided
that (i) such Eligible Assignee, if not then a Lender or an Affiliate of the assigning Lender,
shall be approved by the Administrative Agent and (if no Event of Default then exists) Borrower
(neither of which approvals shall be unreasonably withheld or delayed), (ii) such assignment shall
be evidenced by a Commitment Assignment and Acceptance, a copy of which shall be furnished to the
Administrative Agent as hereinbelow provided, (iii) except in the case of an assignment to
an Affiliate of the assigning Lender, to another Lender or of the entire remaining Commitments of
the assigning Lender, the assignment shall not assign a Pro Rata Share of the Commitments that is
equivalent to less than $5,000,000 and (iv) the effective date of any such assignment shall be as
specified in the Commitment Assignment and Acceptance, but not earlier than the date which is five
(5) Banking Days after the date the Administrative Agent



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has received the Commitment Assignment and Acceptance. Upon the effective date of such
Commitment Assignment and Acceptance, the Eligible Assignee named therein shall be a Lender for all
purposes of this Agreement, with the Pro Rata Share of the Commitments therein set forth and, to
the extent of such Pro Rata Share, the assigning Lender shall be released from its further
obligations under this Agreement. Borrower agrees that it shall execute and deliver (against
delivery by the assigning Lender to Borrower of its Notes) to such assignee Lender, Notes
evidencing that assignee Lender’s Pro Rata Share of the Commitments, and to the assigning Lender,
Notes evidencing the remaining balance Pro Rata Share retained by the assigning Lender.




          (c) By executing and delivering a Commitment Assignment and Acceptance, the Eligible Assignee
thereunder acknowledges and agrees that: (i) other than the representation and warranty that it is
the legal and beneficial owner of the Pro Rata Share of the Commitments being assigned thereby free
and clear of any adverse claim, the assigning Lender has made no representation or warranty and
assumes no responsibility with respect to any statements, warranties or representations made in or
in connection with this Agreement or the execution, legality, validity, enforceability, genuineness
or sufficiency of this Agreement or any other Loan Document; (ii) the assigning Lender has made no
representation or warranty and assumes no responsibility with respect to the financial condition of
Borrower or the performance by Borrower of the Obligations; (iii) it has received a copy of this
Agreement, together with copies of the most recent financial statements delivered pursuant to
Section 7.1 and such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Commitment Assignment and Acceptance; (iv) it
will, independently and without reliance upon the Administrative Agent, the Collateral Agent or any
Lender and based on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under this Agreement; (v)
it appoints and authorizes the Administrative Agent and the Collateral Agent to take such action
and to exercise such powers under this Agreement as are delegated to the Administrative Agent and
the Collateral Agent by this Agreement; and (vi) it will perform in accordance with their terms all
of the obligations which by the terms of this Agreement are required to be performed by it as a
Lender.




          (d) The Administrative Agent shall maintain at the Administrative Agent’s Office a copy of
each Commitment Assignment and Acceptance delivered to it and a register (the “Register”) of the
names and address of each of the Lenders and the Pro Rata Share of the Commitments held by each
Lender, giving effect to each Commitment Assignment and Acceptance. The Register shall be
available during normal business hours for inspection by Borrower or any Lender upon reasonable
prior notice to the Administrative Agent. After receipt of a completed Commitment Assignment and
Acceptance executed by any Lender and an Eligible Assignee, and receipt of an assignment fee of
$3,500 from such Lender or Eligible Assignee, the Administrative Agent shall, promptly following
the effective date thereof, provide to Borrower and the Lenders a revised Schedule 1.1
giving effect thereto. Borrower, the Administrative Agent, the Collateral Agent and the Lenders
shall deem and treat the Persons listed as Lenders in the Register as the holders and owners of the
Pro Rata Share of the Commitments listed therein for all purposes hereof, and no assignment or
transfer of any such Pro Rata Share of the Commitments shall be effective, in each case unless and
until a Commitment Assignment and Acceptance effecting the assignment or transfer thereof shall
have



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been accepted by the Administrative Agent and recorded in the Register as provided above.
Prior to such recordation, all amounts owed with respect to the applicable Pro Rata Share of the
Commitments shall be owed to the Lender listed in the Register as the owner thereof, and any
request, authority or consent of any Person who, at the time of making such request or giving such
authority or consent, is listed in the Register as a Lender shall be conclusive and binding on any
subsequent holder, assignee or transferee of the corresponding Pro Rata Share of the Commitments.




          (e) Each Lender may from time to time grant participations to one or more banks or other
financial institutions in a portion of its Pro Rata Share of the Commitments; provided,
however, that (i) such Lender’s obligations under this Agreement shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto for the performance of
such obligations, (iii) the participating banks or other financial institutions shall not be a
Lender hereunder for any purpose except, if the participation agreement so provides, for
the purposes of Sections 3.6, 3.7, 11.11 and 11.22 but only to the extent that
the cost of such benefits to Borrower does not exceed the cost which Borrower would have incurred
in respect of such Lender absent the participation, (iv) Borrower, the Administrative Agent, the
Collateral Agent, 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, (v) the participation
interest shall be expressed as a percentage of the granting Lender’s Pro Rata Share of the
Commitments as it then exists and shall not restrict an increase in the Commitments, or in the
granting Lender’s Pro Rata Share of the Commitments, so long as the amount of the participation
interest is not affected thereby, (vi) the holder of the participation interest shall abide by the
confidentiality provisions set forth herein and (vii) the consent of the holder of such
participation interest shall not be required for amendments or waivers of provisions of the Loan
Documents other than those which (a) extend the Revolving Loan Maturity Date or any other
date upon which any payment of money is due to the Lenders, (b) reduce the rate of interest on the
Notes, any fee or any other monetary amount payable to the Lenders, (c) reduce the amount of any
installment of principal due under the Notes, (d) release any Subsidiary Guaranty, or (E) release
all or substantially all of the Collateral from the Lien of the Collateral Documents, except if
such release of Collateral occurs in connection with a Disposition permitted under Section
6.2 or grant of a purchase-money Lien of the type specified in clause (s) of the definition
of “Permitted Encumbrances” (unless the holder of such Lien does not prohibit a subordinate Lien on
the acquired property or assets, in which case the Collateral Agent shall subordinate its Lien on
such acquired property or assets in a manner acceptable to the holder of the purchase-money Lien
without the need for the consent of any Lender), in which case such release shall not require the
consent of any of the Lenders or of any holder of a participation interest in the Commitments.




     11.9 Right of Setoff. If an Event of Default has occurred and is continuing, the
Administrative Agent, the Collateral Agent or any Lender (but in each case only with the consent of
the Requisite Lenders) may exercise its rights under Article 9 of the Uniform Commercial Code and
other applicable Laws and, to the extent permitted by applicable Laws, apply any funds in any
deposit account maintained with it by Borrower and/or any Property of Borrower in its possession
against the Obligations.



     11.10 Sharing of Setoffs. Each Lender severally agrees that if it, through the
exercise of any right of setoff, banker’s lien or counterclaim against Borrower, or otherwise,
receives



76









 







payment of the Obligations held by it that is ratably more than any other Lender, through any
means, receives in payment of the Obligations held by that Lender, then, subject to applicable
Laws: (a) the Lender exercising the right of setoff, banker’s lien or counterclaim or otherwise
receiving such payment shall purchase, and shall be deemed to have simultaneously purchased, from
each of the other Lenders a participation in the Obligations held by the other Lenders and shall
pay to the other Lenders a purchase price in an amount so that the share of the Obligations held by
each Lender after the exercise of the right of setoff, banker’s lien or counterclaim or receipt of
payment shall be in the same proportion that existed prior to the exercise of the right of setoff,
banker’s lien or counterclaim or receipt of payment; and (b) such other adjustments and purchases
of participations shall be made from time to time as shall be equitable to ensure that all of the
Lenders share any payment obtained in respect of the Obligations ratably in accordance with each
Lender’s share of the Obligations immediately prior to, and without taking into account, the
payment; provided that, if all or any portion of a disproportionate payment obtained as a result of
the exercise of the right of setoff, banker’s lien, counterclaim or otherwise is thereafter
recovered from the purchasing Lender by Borrower or any Person claiming through or succeeding to
the rights of Borrower, the purchase of a participation shall be rescinded and the purchase price
thereof shall be restored to the extent of the recovery, but without interest. Each Lender that
purchases a participation in the Obligations pursuant to this Section 11.10 shall from and
after the purchase have the right to give all notices, requests, demands, directions and other
communications under this Agreement with respect to the portion of the Obligations purchased to the
same extent as though the purchasing Lender were the original owner of the Obligations purchased.
Borrower expressly consents to the foregoing arrangements and agrees that any Lender holding a
participation in an Obligation so purchased pursuant to this Section 11.10 may exercise any and
all rights of setoff, banker’s lien or counterclaim with respect to the participation as fully as
if the Lender were the original owner of the Obligation purchased.



     11.11 Indemnity by Borrower. Borrower agrees to indemnify, save and hold harmless the
Administrative Agent, the Collateral Agent, and each Lender and their respective directors,
officers, agents, attorneys and employees (collectively the “Indemnitees”) from and
against: (a) any and all claims, demands, actions or causes of action (except a claim, demand,
action, or cause of action for any amount excluded from the definition of “Taxes” in Section
3.12(e)) if the claim, demand, action or cause of action arises out of or relates to any act
or omission (or alleged act or omission) of Borrower, its Affiliates or any of its officers,
directors or stockholders relating to the Commitment, the use or contemplated use of proceeds of
any Loan, or the relationship of Borrower and the Lenders under this Agreement; (b) any
administrative or investigative proceeding by any Governmental Agency arising out of or related to
a claim, demand, action or cause of action described in clause (a) above; and (c) any and all
liabilities, losses, reasonable costs or expenses (including reasonable attorneys’ fees and
the reasonably allocated costs of attorneys employed by any Indemnitee and disbursements of such
attorneys and other professional services) that any Indemnitee suffers or incurs as a result of the
assertion of any foregoing claim, demand, action or cause of action; provided that no
Indemnitee shall be entitled to indemnification for any loss caused by its own gross negligence or
willful misconduct (determined to be so by a final determination of a court of competent
jurisdiction) or for any loss asserted against it by another Indemnitee. If any claim, demand,
action or cause of action is asserted against any Indemnitee, such Indemnitee shall promptly notify
Borrower, but the failure to so promptly notify Borrower shall not affect Borrower’s obligations
under this Section unless such failure materially prejudices Borrower’s right to participate in the
contest of such claim,



77









 







demand, action or cause of action, as hereinafter provided. Such Indemnitee may (and shall,
if requested by Borrower in writing) contest the validity, applicability and amount of such claim,
demand, action or cause of action and shall permit Borrower to participate in such contest. Such
Indemnitee shall act reasonably and in good faith in dealing with such claim, demand, action or
cause of action, including in electing whether to offer or accept any settlement or compromise of
such claim, demand, action or cause of action. Borrower shall have the burden of establishing the
lack of good faith or reasonableness of such Indemnitee. Any Indemnitee that proposes to settle or
compromise any claim or proceeding for which Borrower may be liable for payment of indemnity
hereunder shall give Borrower written notice of the terms of such proposed settlement or compromise
reasonably in advance of settling or compromising such claim or proceeding and shall obtain
Borrower’s prior written consent (which shall not be unreasonably withheld or delayed). In
connection with any claim, demand, action or cause of action covered by this Section 11.11
against more than one Indemnitee, all such Indemnitees shall be represented by the same legal
counsel (which may be a law firm engaged by the Indemnitees or attorneys employed by an Indemnitee
or a combination of the foregoing) selected by the Indemnitees and reasonably acceptable to
Borrower; provided, that if such legal counsel determines in good faith that representing
all such Indemnitees would or could result in a conflict of interest under Laws or ethical
principles applicable to such legal counsel or that a defense or counterclaim is available to an
Indemnitee that is not available to all such Indemnitees, then to the extent reasonably necessary
to avoid such a conflict of interest or to permit unqualified assertion of such a defense or
counterclaim, each affected Indemnitee shall be entitled to separate representation by legal
counsel selected by that Indemnitee and reasonably acceptable to Borrower, with all such legal
counsel using reasonable efforts to avoid unnecessary duplication of effort by counsel for all
Indemnitees; and further provided that the Administrative Agent (as an Indemnitee) shall at
all times be entitled to representation by separate legal counsel (which may be a law firm or
attorneys employed by the Administrative Agent or a combination of the foregoing). Any obligation
or liability of Borrower to any Indemnitee under this Section 11.11 shall survive the
expiration or termination of this Agreement and the repayment of all Loans and the payment and
performance of all other Obligations owed to the Lenders.



     11.12 Nonliability of the Lenders. Borrower acknowledges and agrees that:



          (a) Any inspections of any Property of Borrower made by or through the Administrative Agent,
the Collateral Agent or the Lenders are for purposes of administration of the Loan only and
Borrower is not entitled to rely upon the same (whether or not such inspections are at the expense
of Borrower);




          (b) By accepting or approving anything required to be observed, performed, fulfilled or given
to the Administrative Agent, the Collateral Agent or the Lenders pursuant to the Loan Documents,
neither the Administrative Agent, the Collateral Agent nor the Lenders shall be deemed to have
warranted or represented the sufficiency, legality, effectiveness or legal effect of the same, or
of any term, provision or condition thereof, and such acceptance or approval thereof shall not
constitute a warranty or representation to anyone with respect thereto by the Administrative Agent,
the Collateral Agent or the Lenders;




          (c) The relationship between Borrower and the Administrative Agent, the Collateral Agent and
the Lenders is, and shall at all times remain, solely that of borrowers and



78









 






lenders; neither the Administrative Agent, the Collateral Agent nor the Lenders shall under
any circumstance be construed to be partners or joint venturers of Borrower or its Affiliates;
neither the Administrative Agent, the Collateral Agent nor the Lenders shall under any circumstance
be deemed to be in a relationship of confidence or trust or a fiduciary relationship with Borrower
or its Affiliates, or to owe any fiduciary duty to Borrower or its Affiliates; neither the
Administrative Agent, the Collateral Agent nor the Lenders undertake or assume any responsibility
or duty to Borrower or its Affiliates to select, review, inspect, supervise, pass judgment upon or
inform Borrower or its Affiliates of any matter in connection with their Property or the operations
of Borrower or its Affiliates; Borrower and its Affiliates shall rely entirely upon their own
judgment with respect to such matters; and any review, inspection, supervision, exercise of
judgment or supply of information undertaken or assumed by the Administrative Agent, the Collateral
Agent or the Lenders in connection with such matters is solely for the protection of the
Administrative Agent, the Collateral Agent and the Lenders and neither Borrower nor any other
Person is entitled to rely thereon; and




          (d) The Administrative Agent, the Collateral Agent and the Lenders shall not be responsible or
liable to any Person for any loss, damage, liability or claim of any kind relating to injury or
death to Persons or damage to Property caused by the actions, inaction or negligence of Borrower
and/or its Affiliates and Borrower hereby indemnifies and holds the Administrative Agent, the
Collateral Agent and the Lenders harmless on the terms set forth in Section 11.11 from any such
loss, damage, liability or claim.




     11.13 No Third Parties Benefited. This Agreement is made for the purpose of defining
and setting forth certain obligations, rights and duties of Borrower, the Administrative Agent, the
Collateral Agent and the Lenders in connection with the Loans, and is made for the sole benefit of
Borrower, the Administrative Agent, the Collateral Agent and the Lenders, and the Administrative
Agent’s, the Collateral Agent’s and the Lenders’ successors and assigns. Except as
provided in Sections 11.8 and 11.11, no other Person shall have any rights of any nature
hereunder or by reason hereof.



     11.14 Confidentiality. Each Lender agrees to hold any confidential information that
it may receive from Borrower pursuant to this Agreement in confidence, except for disclosure: (a)
to other Lenders or Affiliates of a Lender; (b) to legal counsel and accountants for Borrower or
any Lender; (c) to other professional advisors to Borrower or any Lender, provided that the
recipient has accepted such information subject to a confidentiality agreement substantially
similar to this Section 11.14; (d) to regulatory officials having jurisdiction over that
Lender, (e) as required by Law or legal process, provided that each Lender agrees to notify
Borrower of any such disclosures unless prohibited by applicable Laws, or in connection with any
legal proceeding to which that Lender and Borrower are adverse parties; (f) to another financial
institution in connection with a disposition or proposed disposition to that financial institution
of all or part of that Lender’s interests hereunder or a participation interest in its Notes,
provided that the recipient has accepted such information subject to a confidentiality agreement
substantially similar to this Section 11.14 and (g) in connection with the exercise of remedies
under any of the Loan Documents. For purposes of the foregoing, “confidential information” shall
mean any information respecting Borrower or its Subsidiaries reasonably considered by Borrower to
be confidential, other than (i) information previously filed with any Governmental Agency
and available to the public, (ii) information previously published in any public medium



79









 







from a source other than, directly or indirectly, that Lender, and (iii) information
previously disclosed by Borrower to any Person not associated with Borrower which does not owe a
professional duty of confidentiality to Borrower or which has not executed an appropriate
confidentiality agreement with Borrower. Nothing in this Section shall be construed to create or
give rise to any fiduciary duty on the part of the Administrative Agent, the Collateral Agent or
the Lenders to Borrower.



     11.15 Further Assurances. Borrower shall, at its expense and without expense to the
Lenders, the Administrative Agent, or the Collateral Agent, do, execute and deliver such further
acts and documents as the Requisite Lenders, the Administrative Agent, or the Collateral Agent from
time to time reasonably require for the assuring and confirming unto the Lenders, the
Administrative Agent, or the Collateral Agent of the rights hereby created or intended now or
hereafter so to be, or for carrying out the intention or facilitating the performance of the terms
of any Loan Document



     11.16 Integration. This Agreement, together with the other Loan Documents, comprises
the complete and integrated agreement of the parties on the subject matter hereof and supersedes
all prior agreements, written or oral, on the subject matter hereof, including the Existing Loan
Agreement and all Loan Documents referred to therein. In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the provisions of this Agreement
shall control and govern; provided that the inclusion of supplemental rights or remedies in
favor of the Administrative Agent, the Collateral Agent or the Lenders in any other Loan Document
shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the joint
participation of the respective parties thereto and shall be construed neither against nor in favor
of any party, but rather in accordance with the fair meaning thereof.



     11.17 GOVERNING LAW; VENUE. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN ANY OF THE LOAN
DOCUMENTS, IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE OBLIGATIONS ARISING HEREUNDER AND THEREUNDER SHALL
BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA
APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES THEREOF
REGARDING CONFLICTS OF LAWS, AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. BORROWER
HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN SAN DIEGO COUNTY, CALIFORNIA
SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN BORROWER AND
BANK PERTAINING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR TO ANY MATTER ARISING OUT OF OR
RELATED TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS; PROVIDED, THAT BANK, AND
BORROWER ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED
OUTSIDE OF SAN DIEGO COUNTY, CALIFORNIA; AND FURTHER PROVIDED, THAT NOTHING
IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE BANK FROM BRINGING SUIT OR TAKING OTHER
LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR
ANY



80









 







OTHER SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF
AGENT FOR THE BENEFIT OF ITSELF AND LENDERS. BORROWER EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO
SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND BORROWER HEREBY WAIVES ANY
OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR
FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR
EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT. BORROWER HEREBY WAIVES PERSONAL SERVICE
OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT
SERVICE OF SUCH SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO BORROWER AT THE ADDRESS SET FORTH IN SECTION 11.6 AND THAT SERVICE SO MADE SHALL BE
DEEMED COMPLETED UPON THE EARLIER OF BORROWER’S ACTUAL RECEIPT THEREOF OR THREE DAYS AFTER DEPOSIT
IN THE UNITED STATES MAILS, PROPER POSTAGE PREPAID.



     11.18 Severability of Provisions. Any provision in any Loan Document that is held to
be inoperative, unenforceable or invalid as to any party or in any jurisdiction shall, as to that
party or jurisdiction, be inoperative, unenforceable or invalid without affecting the remaining
provisions or the operation, enforceability or validity of that provision as to any other party or
in any other jurisdiction, and to this end the provisions of all Loan Documents are declared to be
severable.



     11.19 Headings. Article and Section headings in this Agreement and the other Loan
Documents are included for convenience of reference only and are not part of this Agreement or the
other Loan Documents for any other purpose.



     11.20 Time of the Essence. Time is of the essence of the Loan Documents.



     11.21 Foreign Lenders and Participants. Each Lender that is incorporated or otherwise
organized under the Laws of a jurisdiction other than the United States of America or any State
thereof or the District of Columbia shall deliver to Borrower (with a copy to the Administrative
Agent), on or before the Closing Date (or on or before accepting an assignment or receiving a
participation interest herein pursuant to Section 11.8, if applicable) two duly completed
copies, signed by a Responsible Official, of either Form 1001 (relating to such Lender and
entitling it to a complete exemption from withholding on all payments to be made to such Lender by
Borrower pursuant to this Agreement) or Form 4224 (relating to all payments to be made to such
Lender by the Borrower pursuant to this Agreement) of the United States Internal Revenue Service or
such other evidence (including, if reasonably necessary, Form W-9) satisfactory to Borrower
and the Administrative Agent that no withholding under the federal income tax laws is required with
respect to such Lender. Thereafter and from time to time, each such Lender shall (a) promptly
submit to Borrower (with a copy to the Administrative Agent), such additional duly completed and
signed copies of one of such forms (or such successor forms as shall be adopted from time to time
by the relevant United States taxing authorities) as may then be available under then current
United States laws and regulations to avoid, or such evidence as is satisfactory to Borrower and
the Administrative Agent of any available exemption from, United States withholding taxes in



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respect of all payments to be made to such Lender by Borrower pursuant to this Agreement and
(b) take such steps as shall not be materially disadvantageous to it, in the reasonable judgment of
such Lender, and as may be reasonably necessary (including the re-designation of its Eurodollar
Lending Office, if any) to avoid any requirement of applicable Laws that Borrower make any
deduction or withholding for taxes from amounts payable to such Lender. In the event that Borrower
or the Administrative Agent become aware that a participation has been granted pursuant to Section
11.8(e) to a financial institution that is incorporated or otherwise organized under the Laws of
a jurisdiction other than the United States of America, any State thereof or the District of
Columbia, then, upon request made by Borrower or the Administrative Agent to the Lender which
granted such participation, such Lender shall cause such participant financial institution to
deliver the same documents and information to Borrower and the Administrative Agent as would be
required under this Section if such financial institution were a Lender.



     11.22 Hazardous Material Indemnity. Borrower hereby agrees to indemnify, hold
harmless and defend (by counsel reasonably satisfactory to the Administrative Agent) the
Administrative Agent, the Collateral Agent and each of the Lenders and their respective directors,
officers, employees, agents, successors and assigns from and against any and all claims, losses,
damages, liabilities, fines, penalties, charges, administrative and judicial proceedings and
orders, judgments, remedial action requirements, enforcement actions of any kind, and all
reasonable costs and expenses incurred in connection therewith (including but not limited to
reasonable attorneys’ fees and the reasonably allocated costs of attorneys employed by the
Administrative Agent or any Lender, and expenses to the extent that the defense of any such action
has not been assumed by Borrower), arising directly or indirectly out of (i) the presence on, in,
under or about any Real Property of any Hazardous Materials, or any releases or discharges of any
Hazardous Materials on, under or from any Real Property and (ii) any activity carried on or
undertaken on or off any Real Property by Borrower or any of its predecessors in title, whether
prior to or during the term of this Agreement, and whether by Borrower or any predecessor in title
or any employees, agents, contractors or subcontractors of Borrower or any predecessor in title, or
any third persons at any time occupying or present on any Real Property, in connection with the
handling, treatment, removal, storage, decontamination, clean-up, transport or disposal of any
Hazardous Materials at any time located or present on, in, under or about any Real Property. The
foregoing indemnity shall further apply to any residual contamination on, in, under or about any
Real Property, or affecting any natural resources, and to any contamination of any Property or
natural resources arising in connection with the generation, use, handling, storage, transport or
disposal of any such Hazardous Materials, and irrespective of whether any of such activities were
or will be undertaken in accordance with applicable Laws, but the foregoing indemnity shall not
apply to Hazardous Materials on any Real Property, the presence of which is caused by the
Administrative Agent or the Lenders. Borrower hereby acknowledges and agrees that, notwithstanding
any other provision of this Agreement or any of the other Loan Documents to the contrary, the
obligations of Borrower under this Section shall be unlimited corporate obligations of Borrower and
shall not be secured by any Lien on any Real Property. Any obligation or liability of Borrower to
any Indemnitee under this Section 11.22 shall survive the expiration or termination of this
Agreement and the repayment of all Loans and the payment and performance of all other Obligations
owed to the Lenders.



     11.23 DISPUTES. TO THE EXTENT PERMITTED BY LAW, IN CONNECTION WITH ANY CLAIM, CAUSE
OF ACTION, PROCEEDING OR OTHER DISPUTE



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CONCERNING THE LOAN DOCUMENTS (EACH A “CLAIM”), THE PARTIES TO THIS AGREEMENT EXPRESSLY,
INTENTIONALLY, AND DELIBERATELY WAIVE ANY RIGHT EACH MAY OTHERWISE HAVE TO TRIAL BY JURY. IN THE
EVENT THAT THE WAIVER OF JURY TRIAL SET FORTH IN THE PREVIOUS SENTENCE IS NOT ENFORCEABLE UNDER THE
LAW APPLICABLE TO THIS AGREEMENT, THE PARTIES TO THIS AGREEMENT AGREE THAT ANY CLAIM, INCLUDING ANY
QUESTION OF LAW OR FACT RELATING THERETO, SHALL, AT THE WRITTEN REQUEST OF ANY PARTY, BE DETERMINED
BY JUDICIAL REFERENCE PURSUANT TO THE STATE LAW APPLICABLE TO THIS AGREEMENT. THE PARTIES SHALL
SELECT A SINGLE NEUTRAL REFEREE, WHO SHALL BE A RETIRED STATE OR FEDERAL JUDGE. IN THE EVENT THAT
THE PARTIES CANNOT AGREE UPON A REFEREE, THE COURT SHALL APPOINT THE REFEREE. THE REFEREE SHALL
REPORT A STATEMENT OF DECISION TO THE COURT. NOTHING IN THIS PARAGRAPH SHALL LIMIT THE RIGHT OF
ANY PARTY AT ANY TIME TO EXERCISE SELF-HELP REMEDIES, FORECLOSE AGAINST COLLATERAL OR OBTAIN
PROVISIONAL REMEDIES. THE PARTIES SHALL BEAR THE FEES AND EXPENSES OF THE REFEREE EQUALLY, UNLESS
THE REFEREE ORDERS OTHERWISE. THE REFEREE SHALL ALSO DETERMINE ALL ISSUES RELATING TO THE
APPLICABILITY, INTERPRETATION, AND ENFORCEABILITY OF THIS PARAGRAPH. THE PARTIES ACKNOWLEDGE THAT
IF A REFEREE IS SELECTED TO DETERMINE THE CLAIMS, THEN THE CLAIMS WILL NOT BE DECIDED BY A JURY.



     11.24 Purported Oral Amendments. BORROWER EXPRESSLY ACKNOWLEDGES THAT THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS MAY ONLY BE AMENDED OR MODIFIED, OR THE PROVISIONS HEREOF OR THEREOF
WAIVED OR SUPPLEMENTED, BY AN INSTRUMENT IN WRITING THAT COMPLIES WITH SECTION 11.2. BORROWER
AGREES THAT IT WILL NOT RELY ON ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR ORAL OR WRITTEN
STATEMENTS BY ANY REPRESENTATIVE OF THE ADMINISTRATIVE AGENT OR ANY BANK THAT DOES NOT COMPLY WITH
SECTION 11.2 TO EFFECT AN AMENDMENT, MODIFICATION, WAIVER OR SUPPLEMENT TO THIS AGREEMENT OR
THE OTHER LOAN DOCUMENTS.



     11.25 Patriot Act. Bank is subject to the Patriot Act and hereby notifies Borrower
that, pursuant to the requirements of the Patriot Act, Bank is required to obtain, verify and
record information that identifies Borrower, which information includes the name and address of
Borrower and other information that will allow Bank to identify Borrower in accordance with the
Patriot Act.



     11.26 Effect of Amendment and Restatement. Except as otherwise set forth herein, this
Agreement is intended to and does completely amend and restate, without novation, the Existing Loan
Agreement. All security interests granted under the Collateral Documents executed in connection
with the Existing Loan Agreement are hereby confirmed and ratified and shall continue to secure all
Obligations under this Agreement.



[Signature Pages Follow]




83








 





     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of
the date first above written.



	 	 	 	 	 
	 	VIASAT, INC.

 	 
	 	By:  	/s/ Ronald G. Wangerin
 	 
	 	 	Ronald G. Wangerin 	 
	 	 	Chief Financial Officer 	 
	 


Address:



ViaSat, Inc.

6155 El Camino Real

Carlsbad, California 92009

Attn: Ronald G. Wangerin

          Chief Financial Officer



Telecopier:  (760) 929-3926

Telephone:  (760) 476-2200




	 	 	 	 	 
	 	UNION BANK OF CALIFORNIA, N.A.,

as Administrative Agent

 	 
	 	By:  	/s/ Mark Adelman
 	 
	 	 	Mark Adelman 	 
	 	 	Vice President 	 
	 


Address:



Union Bank of California, N.A.

San Diego Commercial Banking Office

530 “B” Street, 4th Floor, S-420

San Diego, California 92101-4407

Attn: Mark Adelman



Telecopier:  (619) 230-3766

Telephone:  (619) 230-3516




[Signature Page to Third Amended and Restated Revolving Loan Agreement]

[Signatures Continued Next Page]




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	 	UNION BANK OF CALIFORNIA, N.A.,

as Collateral Agent

 	 
	 	By:  	/s/ Mark Adelman
 	 
	 	 	Mark Adelman 	 
	 	 	Vice President 	 
	 


Address:



Union Bank of California, N.A.

San Diego Commercial Banking Office

530 “B” Street, 4th Floor, S-420

San Diego, California 92101-4407

Attn: Mark Adelman



Telecopier:  (619) 230-3766

Telephone:  (619) 230-3516




	 	 	 	 	 
	 	UNION BANK OF CALIFORNIA, N.A.,

as a Lender

 	 
	 	By:  	/s/ Mark Adelman
 	 
	 	 	Mark Adelman 	 
	 	 	Vice President 	 
	 


Address:



Union Bank of California, N.A.

San Diego Commercial Banking Office

530 “B” Street, 4th Floor, S-420

San Diego, California 92101-4407

Attn: Mark Adelman



Telecopier:  (619) 230-3766

Telephone:  (619) 230-3516




[Signature Page to Third Amended and Restated Revolving Loan Agreement]

[Signatures Continued Next Page]




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	 	Bank of America, N.A.,

as a Lender

 	 
	 	By:  	/s/ Karin S. Barnes
 	 
	 	 	Name:  	 Karin S. Barnes 	 
	 	 	 	 Senior Vice President 	 
	 


Address:



Bank of America, N.A.

450 B Street, Suite 1500

San Diego, CA 92101

Attn: Karin S. Barnes

           Senior Vice President




[Signature Page to Third Amended and Restated Revolving Loan Agreement]

[Signatures Continued Next Page]




S-3









 








	 	 	 	 	 
	 	JPMorgan Chase Bank, N.A.,

as a Lender

 	 
	 	By:  	/s/ Anna C. Ruiz
 	 
	 	 	Name:  	Anna C. Ruiz 	 
	 	 	 	Vice President 	 
	 


Address:



JPMorgan Chase Bank, N.A.

650 Town Center Drive, Suite 1000

Costa Mesa, CA 92626

Attn: Anna C. Ruiz

           Vice President




[Signature Page to Third Amended and Restated Revolving Loan Agreement]




S-4