exhibit10-3.htm


    AMENDED AND RESTATED 

    REVOLVING CREDIT AGREEMENT 

     

    ROSS STORES, INC. 

     

     

    Dated as of March 31, 2004 

     

     

    
      	 


    

     

     

    FLEET NATIONAL BANK 

     

    AND


     

    OTHER LENDING INSTITUTIONS WHICH MAY BECOME 

    PARTIES TO THIS AGREEMENT 

     

    AND


     

    FLEET NATIONAL BANK, 

    as
Administrative Agent 

     

    WACHOVIA BANK, N.A., 

    as
Syndication Agent 

     

    BANK ONE, N.A., 

    BNP
PARIBAS, 

    AND

WELLS FARGO BANK,
NATIONAL ASSOCIATION 

    as
Co-Documentation Agents 

     

    WITH 

     

    FLEET SECURITIES, INC., and 

    WACHOVIA CAPITAL MARKETS, LLC, 

    as
Co-Arrangers 

     

    AND


     

    FLEET SECURITIES, INC., 

    as
Book Runner 

       

    
      	 


    

     

     

     

    

    
    


    
      	
            	TABLE OF CONTENTS	
            
	 	 	 
	Section	Title	Page
	
            	
            	SECTION I - DEFINITIONS	
            
	 	 	   	 
	1.1	
            	Definitions	1
	1.2	
            	Terms of General Application	17
	 	 	   	 
	
            	
            	SECTION II - DESCRIPTION OF
      CREDIT	
            
	 	 	 
      	 
	2.	 	The Credit Facilities	18
	2.1	
            	The Loans	18
	2.2	
            	Records	21
	2.3	
            	Conversion	21
	2.4	
            	Notice and Manner of Borrowing or	
            
	
            	
            	    Conversion of
      Loans	21
	2.5	
            	Commitment Fee	22
	2.6	
            	Fee Letter	23
	2.7	 	Reduction of Revolving Credit Commitment	23
	2.8	
            	Duration of Interest Periods	23
	2.9	
            	Interest Rates and Payments of Interest	23
	2.10	
            	Utilization Fee	25
	2.11	
            	Protective Provisions	25
	2.11.1	     	Inability to Determine Adjusted LIBOR Rate	25
	2.11.2	
            	Illegality	26
	2.11.3	
            	Additional Costs, etc.	26
	2.12	
            	Capital Requirements	27
	2.13	
            	Payments and Prepayments of the Loans	28
	2.14	
            	Method of Payment; Withholding Tax Exemption	29
	2.15	
            	Default Rate Interest, Etc.	32
	2.16	
            	Payments Not at End of Interest Period	32
	2.17	
            	Computation of Interest and Fees; Maximum Interest	33
	2.18	
            	Letters of Credit	33
	2.19	
            	Letter of Credit Fees	36
	2.20	
            	Interdependence of Borrower Affiliated Group	37


    


    i

     

    

    
    


    
      	 	 	SECTION III - CONDITIONS OF
      LOAN	 
	 	 	    
       	 
	3.1	 	Conditions Precedent to Effectiveness of Agreement	38
	3.1.1	 	Loan Documents, Etc.	38
	3.1.2	 	Legality of Transactions	38
	3.1.3	 	Representations and Warranties	38
	3.1.4	 	Performance, Consents, No Defaults Litigation, Etc.	38
	3.1.5	 	Certified Copies of Charter Documents	39
	3.1.6	
            	Proof of Entity Action	39
	3.1.7	
            	Incumbency Certificate	39
	3.1.8	
            	Proceedings and Documents	39
	3.1.9	
            	Good Standing, Etc.	39
	3.1.10	
            	Fees	40
	3.1.11	
            	Legal Opinion	40
	3.1.12	
            	Due Diligence; Financial Condition	40
	3.1.13	     	U.C.C. Search Reports; Insurance	40
	3.1.14	
            	Syndication	40
	3.2	
            	Conditions Precedent to Initial Funding Date, and all
    Loans	
            
	
            	
            	    and Letters of
      Credit	40
	
            	
            	    
	
            	
            	SECTION IV - REPRESENTATIONS AND
      WARRANTIES
	
            	
            	    
	4.1	
            	Organization and Qualification	41
	4.2	
            	Entity Authority	42
	4.3	
            	Valid Obligations	42
	4.4	
            	Consents or Approval	42
	4.5	
            	Title to Properties; Absence of Encumbrances	42
	4.6	
            	Franchises, Patents, Copyrights, Etc.	43
	4.7	
            	Financial Statements	43
	4.8	
            	Changes	43
	4.9	
            	Defaults	43
	4.10	
            	Taxes	43
	4.11	
            	Litigation	44
	4.12	
            	Subsidiaries	44
	4.13	
            	Investment Company Act	44
	4.14	 	Compliance with ERISA	44
	4.15	
            	Environmental Matters	44
	4.16	
            	Disclosure	44
	4.17	
            	Solvency	45


    


    ii

     

    

    
    


    
      	4.18	 	Compliance with Statutes,
      Etc.	45
	4.19	 	Labor Relations	45
	4.20	 	Certain Transactions	45
	4.21	 	Restrictions on the Borrower
      Affiliated Group	45
	 	 	  	 
	 	 	SECTION V - AFFIRMATIVE
      COVENANTS	 
	 	 	   	 
	5.1	 	Financial Statements and other Reporting Requirements	46
	5.2	 	Conduct of Business	47
	5.3	 	Maintenance and Insurance	48
	5.4	 	Taxes	48
	5.5	 	Inspection by the Administrative Agent	49
	5.6	 	Maintenance of Books and Records	49
	5.7	 	Use of Proceeds	49
	5.8	 	Pension Plans	49
	5.9	
            	Fiscal Year	49
	5.10	
            	Further Assurances	49
	
            	
            	 	
            
	
            	
            	SECTION VI - NEGATIVE
      COVENANTS	
            
	
            	
            	 	
            
	6.1	
            	Indebtedness	50
	6.2	
            	Contingent Liabilities	50
	6.3	
            	Sale and Leaseback	51
	6.4	
            	Encumbrances	51
	6.5	
            	Merger; Consolidation; Sale or Lease of Assets;	
            
	
            	
            	    Acquisitions	53
	6.6	
            	Minimum Adjusted Interest Coverage Ratio	53
	6.7	
            	Maximum Adjusted Debt to Total Capitalization Ratio	54
	6.8	
            	Restricted Payments	54
	6.9	
            	Investments	54
	6.10	
            	ERISA	54
	6.11	
            	Transactions with Affiliates	54
	6.12	
            	Loans	55
	
            	
            	  	
            
	
            	
            	SECTION VII - DEFAULTS	
            
	
            	
            	  	
            
	7.1	
            	Events of Default	55
	7.2	     	Remedies	57


    


    iii


    

    
    


    
      	 	 	SECTION VIII - CONCERNING THE
      ADMINISTRATIVE	 
	 	 	AGENT AND THE BANKS	 
	 	 	     	 
	8.1	 	Appointment and
    Authorization	58
	8.2	 	Administrative Agent and
      Affiliates	58
	8.3	 	Future Advances	58
	8.4	 	Delinquent Bank	59
	8.5	 	Payments	60
	8.6	 	Action by Administrative
      Agent	60
	8.7	 	Notification of Defaults and Events
      of Default	61
	8.8	 	Consultation with Experts	61
	8.9	 	Liability of Administrative
      Agent	61
	8.10	 	Indemnification	62
	8.11	 	Independent Credit
    Decision	62
	8.12	 	Successor Administrative
      Agent	62
	8.13	 	Other Agents	63
	 	 	     
	 
	 	 	SECTION IX -
MISCELLANEOUS	 
	  	 	  	 
	9.1	 	Notices	63
	9.2	 	Expenses	64
	9.3	 	Indemnification	65
	9.4	
            	Set-Off	65
	9.5	
            	Term of Agreement	66
	9.6	
            	No Waivers	66
	9.7	
            	Governing Law	66
	9.8	
            	Amendments, Waivers, Etc.	66
	9.9	
            	Binding Effect of Agreement	66
	9.10	
            	Successors and Assigns	67
	9.11	
            	Counterparts	68
	9.12	
            	Partial Invalidity	68
	9.13	 	Captions	68
	9.14	     	Waiver of Jury Trial	68
	9.15	
            	Entire Agreement	69
	9.16	
            	Replacement of Loan Documents, Etc.	69
	9.17	
            	USA PATRIOT Act Notice	69


    


    iv


    

    
    


    SCHEDULES 

     

    
      	
              SCHEDULE 1 –
      Commitment Amounts and Commitment Percentages 

            
	 
	
              SCHEDULE 2 -
      Carryover Letters of Credit 

            


    

     

     

     

    EXHIBITS 

     

    
      	
              EXHIBIT A -
      Form of Notice of Borrowing or Conversion 

            
	 
	
              EXHIBIT B -
      Indebtedness; Encumbrances 

            
	 
	
              EXHIBIT C -
      Disclosure 

            
	 
	
              EXHIBIT D -
      Form of Opinion of Counsel to the Borrower Affiliated Group
    

            
	 
	
              EXHIBIT E -
      Form of Report of Chief Financial Officer 

            
	 
	
              EXHIBIT F -
      Form of Assignment and Assumption 

            
	 
	
              EXHIBIT G -
      Form of Subsidiary Guarantee 

            


    

     

     

     

     

     

     

     

     

    v

     

    

    
    


    AMENDED AND RESTATED 

    REVOLVING CREDIT AGREEMENT 

     

    Dated as of March 31, 2004 

     

        THIS AMENDED AND
RESTATED REVOLVING CREDIT AGREEMENT is dated as of March 31, 2004, by and among
ROSS STORES, INC., a Delaware corporation having its principal place of business
and chief executive office at 8333 Central Avenue, Newark, California 94560 (the
“Borrower”), Fleet National Bank (“Fleet”), a national banking association
organized and existing under the laws of the United States of America and having
its head office at 100 Federal Street, Boston, Massachusetts 02110, each of the
other lending institutions listed on Schedule 1 hereto on the date hereof (Fleet and
each such other lending institution, and the other lending institutions which
may become parties hereto pursuant to Section 9.10, individually, a “Bank” and
collectively, the “Banks”), and Fleet, as administrative agent for itself and
each other Bank. This Agreement amends and restates the Revolving Credit
Agreement dated as of August 23, 2001 among the Borrower, Fleet and the Banks
defined therein. 

     

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

     

    SECTION I 

     

    DEFINITIONS 

     

        1.1. Definitions.


     

        All capitalized terms
used in this Agreement or in any other Loan Document (as such terms are defined
below), or in any certificate, report or other document made or delivered
pursuant to this Agreement (unless otherwise defined therein) shall have the
respective meanings assigned to them below: 

     

        Acquisition. See Section 6.5(c). 

     

        Adjusted Debt to Total Capitalization
Ratio. For any
period, the ratio of (i) Consolidated Adjusted Debt as at the last day of such
period to (ii) an amount equal to the sum of Consolidated Adjusted Debt plus
Stockholders’ Equity as at the last day of such period. 

     

        Adjusted Interest Coverage
Ratio. For any
period, the ratio of (i) EBITDAR for such period, to (ii) Consolidated Total
Interest Expense plus Consolidated Rent Expense for such period.

     

    1

     

    

    
    


        Adjusted LIBOR Rate. For any Interest Period, a rate
per annum (rounded upward, if necessary, to the
nearest 1/32 of one percent) as determined on the basis of the offered rates for
deposits in Dollars, for a period of time comparable to such Interest Period
which appears on the Telerate page 3750 as of 11:00 a.m. (London time) on the
day that is two Business Days preceding the first day of such Interest Period;
provided, however, if the rate described above does not
appear on the Telerate System on any applicable interest determination date,
LIBOR shall be the rate (rounded upwards as described above, if necessary) for
deposits in Dollars for a period substantially equal to the Interest Period on
the Reuters Page "LIBO" (or such other page as may replace the LIBO Page on that
service for the purpose of displaying such rates), as of 11:00 a.m. (London
time), on the day that is two Business Days prior to the beginning of such
Interest Period, provided, further, that if both the Telerate and Reuters
systems are unavailable, then the rate for that date will be determined on the
basis of the offered rates for deposits in Dollars for a period of time
comparable to such Interest Period which are offered by 4 major banks in the
London interbank market at approximately 11:00 a.m. (London time), on the day
that is 2 Business Days preceding the first day of such Interest Period as
selected by Administrative Agent. The principal London office of each of the 4
major London banks will be requested to provide a quotation of its Dollar
deposit offered rate. If at least 2 such quotations are provided, the rate for
that date will be the arithmetic mean of the quotations. If fewer than 2
quotations are provided as requested, the rate for that date will be determined
on the basis of the rates quoted for loans in Dollars to leading European banks
for a period of time comparable to such Interest Period offered by major banks
in New York City at approximately 11:00 a.m. (New York City time), on the day
that is 2 Business Days preceding the first day of such Interest Period. In the
event that the Administrative Agent is unable to obtain any such quotation as
provided above, it will be deemed that the Adjusted Libor Rate cannot be
determined. In the event that the Board of Governors of the Federal Reserve
System shall impose a Reserve Percentage with respect to LIBOR deposits of the
Administrative Agent, then for any period during which such Reserve Percentage
shall apply, the Adjusted LIBOR Rate shall be equal to the amount determined
above divided by an amount equal to 1 minus the Reserve Percentage.


     

       Administrative
Agent. Fleet
in the capacity as Administrative Agent for the Banks under this Agreement and
the other Loan Documents, including (where the context so admits) any other
Person or Persons succeeding to the functions of the Administrative Agent
pursuant to this Agreement and the other Loan Documents. 

     

        Affected Bank. See Section 2.12. 

     

        Affiliate. With reference to any Person, (i) any
director or officer of that Person, (ii) any other Person controlling,
controlled by or under direct or indirect common control with that Person (and
if that Person is an individual, any member of the immediate family (including
parents, siblings, spouse, children, stepchildren, nephews, nieces and
grandchildren) of such individual and any trust whose principal beneficiary is
such individual or one or more members of such immediate family and any Person
who is controlled by any such member or trust), (iii) any other Person directly
or indirectly holding 10% or more of any class of the capital stock or other
equity interests (including options, warrants, convertible securities and
similar rights) of that Person, (iv) any other Person 10% or more of any class
of whose capital stock or other equity interests (including options, warrants,
convertible securities and similar rights) is held directly or indirectly by
that Person, and (v) any other Person that possesses, directly or indirectly,
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) of that Person.

     

    2

     

    

    
    


        Agreement. This Amended and Restated Revolving
Credit Agreement, as the same may be renewed, extended, modified, supplemented
or amended from time to time. 

     

        Applicable Commitment Fee
Rate. The
applicable rate per annum set forth in Table 1 in Section 2.9(c) under the
heading “Applicable Commitment Fee Rate,” based on the higher of (i) the Level
applicable to the Borrower under the heading “Rating” or (ii) the Level
applicable to the Borrower under the heading “Adjusted Interest Coverage Ratio”;
provided, however, that during the six-month period
following the Closing Date, the Applicable Commitment Fee Rate shall be equal to
0.150% per annum. 

     

       Applicable LIBOR
Margin. See
Section 2.9(c). 

     

       Arranger. Fleet Securities, Inc.

     

       Assignment and Assumption. See Section 9.10(ii). 

     

       Bank or Banks. See Preamble. 

     

       Borrower. See Preamble.

     

       Borrower Affiliated
Group.
Collectively, the Borrower and each of its Subsidiaries in existence from time
to time. 

     

       Business Day. (i) For all purposes other than as
covered by clause (ii) below, any day other than a Saturday, Sunday or legal
holiday on which banks in both Boston, Massachusetts and San Francisco,
California are open for the conduct of a substantial part of their commercial
banking business; and (ii) with respect to all notices and determinations in
connection with, and payments of principal and interest on, LIBOR Loans, any day
that is a Business Day described in clause (i) and that is also a day on which
trading takes place between banks in United States dollar deposits in the London
interbank market. 

     

       Capitalized Lease. Any lease of real property by a member
of the Borrower Affiliated Group as lessee which is shown as a liability on the
Consolidated balance sheet of the Borrower in accordance with GAAP.


     

       CERCLA. The Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as the same may from time to
time be supplemented or amended and remain in effect. 

     

    3

     

    

    
    


        Change in Law. Any future applicable law or any change
to any present applicable law, which, in each case, includes treaties, statutes,
rules and regulations thereunder and interpretations thereof by any competent
court or by any governmental or other regulatory body or official charged with
the administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Bank or the Administrative Agent by any central bank or
other fiscal, monetary or other authority (whether or not having the force of
law). 

     

       Change of Control. The occurrence of any of the following:
(i) any Person or “group” (within the meaning of Section 13(d) of the Securities
Exchange Act of 1934, as amended) of Persons acting in concert as a partnership
or other group shall, as a result of a tender or exchange offer, open market
purchases, privately negotiated purchases or otherwise, have become, after the
date hereof, the “beneficial owner” (within the meaning of such term under Rule
13d-3 under the Exchange Act) of securities of the Borrower representing 35% or
more of the combined voting power of the then outstanding securities of the
Borrower ordinarily (and apart from rights accruing under special circumstances)
having the right to vote in the election of directors; (ii) the board of
directors of the Borrower shall cease to consist of a majority of the
individuals who constituted the board of directors as of the date hereof or who
shall have become a member thereof subsequent to the date hereof after having
been nominated, or otherwise approved in writing, by at least a majority of
individuals who constituted the board of directors of the Borrower as of the
date hereof; or (iii) any change in equity ownership of any Significant
Subsidiary of the Borrower, except as may be expressly permitted by Section 6.5
hereof. 

     

        Closing Date. March 31, 2004, or such other mutually
agreed date on which all of the conditions set forth in Section 3.1 have been
satisfied or waived by the Administrative Agent and the Banks. 

     

       Co-Arranger. Wachovia Capital Markets, LLC.


     

       Code. The Internal Revenue Code of 1986 and
the rules and regulations thereunder, collectively, as the same may from time to
time be supplemented or amended and remain in effect. 

     

       Commitment Amount. At any time and with respect to any
Bank, the amount set forth adjacent to such Bank's name under the heading
“Commitment Amount” in Schedule 1 at such time or, in the event that such
Bank is not listed on Schedule 1, the “Commitment Amount” which such Bank
shall have assumed upon becoming a Bank pursuant to Section 9.10(ii), as such
Bank’s Commitment Amount may be modified pursuant hereto and as in effect from
time to time (as evidenced by an updated Schedule 1 circulated by the Administrative Agent
from time to time to reflect assignments permitted by Section 9.10).


     

    4

     

    

    
    


       Commitment Fee. The commitment fee payable by the
Borrower to the Banks pursuant to Section 2.5. 

     

       Consolidated and Consolidating. The terms Consolidated and
Consolidating shall have the respective meanings ascribed to such terms under
GAAP. 

     

       Consolidated Adjusted
Debt. As at any date
of determination, all Indebtedness of the Borrower on a Consolidated basis for
borrowed money (including, without limitation but without duplication, (i)
Indebtedness arising under Capitalized Leases, (ii) Indebtedness arising under
Synthetic Leases, (iii) liabilities under Guarantees, and (iv) liabilities under
standby letters of credit (but excluding liabilities under documentary letters
of credit)), plus an amount equal to six times
Consolidated Rent Expense for the twelve-month period ending on such date of
determination. 

     

       Consolidated
Rent Expense.
For any period, the aggregate rental expenses payable by the Borrower on a
Consolidated basis for such period (including percentage rent) under any
operating Lease classified as such under GAAP but not including any amount
included in the definition of “Consolidated Total Interest Expense.”


     

       Consolidated Tangible Net
Worth. As at any date of determination,
Stockholders’ Equity less any intangible assets, with intangible assets defined
as goodwill, patents, trademarks, tradenames, lease rights, capitalized
pre-opening costs, franchises, organization costs and property rights.


     

       Consolidated Total Interest
Expense. For any period, all interest and all
amortization of debt discount and expense (including commitment fees, letter of
credit fees, balance deficiency fees and similar expenses) on all Indebtedness
of the Borrower on a Consolidated basis (including outstanding letters of
credit), all as determined in accordance with GAAP, together with all interest
expense of the Borrower on a Consolidated basis under Synthetic
Leases.

     

       Controlled Group. All trades or businesses (whether or
not incorporated) under common control that, together with the Borrower, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 400l of ERISA. 

     

       Covered Taxes. See Section 2.14(a). 

     

       Default. An event or condition that, but for the
requirement that time elapse or notice be given, or both, would constitute an
Event of Default. 

     

       Delinquent Bank.
See Section 8.4. 

     

       Dollar or $. Dollars in lawful currency of the
United States of America. 

     

       EBITDA. In
relation to the Borrower on a Consolidated basis for any period, an amount equal
to the net income of the Borrower on a Consolidated basis after deduction of all
expenses, taxes and other proper charges, determined in accordance with GAAP for
such period, but, in determining such Consolidated net income, any GAAP
extraordinary gains shall be excluded from such calculation, plus the following to the extent deducted in
computing such Consolidated net income for such period: (i) Consolidated Total
Interest Expense for such period, (ii) Consolidated taxes on income for such
period, (iii) Consolidated depreciation for such period, (iv) Consolidated
amortization for such period, and (v) extraordinary non-cash losses to the
extent such losses have not been and will not become cash losses in a later
fiscal period.

     

    5

     

    

    
    


       EBITDAR. In relation to the Borrower for any
period, an amount equal to EBITDA for such period, plus Consolidated Rent
Expense for such period. 

     

       Eligible Assignee.
Any of: 

     

           (a) a commercial bank
or finance company organized under the laws of the United States, or any state
thereof or the District of Columbia, and having total assets in excess of
$500,000,000;

     

           (b) a savings and
loan association or savings bank organized under the laws of the United States,
or any state thereof or the District of Columbia, and having a net worth of at
least $100,000,000, calculated in accordance with GAAP;

     

           (c) a commercial bank
organized under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development (the “OECD”), or a
political subdivision of any such country, and having total assets in excess of
$500,000,000, or the central bank of any country which is a member of the
OECD;

     

    provided, in each case, that such bank (i) is
acting through a branch or agency located in the United States and (ii) has
delivered to the Administrative Agent, on the date on which the Assignment and
Acceptance to which such Eligible Assignee is a party becomes effective, the
forms referred to in Section 2.14(b) hereof;

     

           and

     

           (d) if, but only if,
any Event of Default has occurred and is continuing, any other bank, insurance
company, commercial finance company or other financial institution or other
Person approved by the Administrative Agent, such approval not to be
unreasonably withheld. 

     

       Encumbrances. See Section 6.4. 

     

       Environmental Claims. All claims, however asserted, alleging
potential liability or responsibility for violation of any Environmental Law or
for release of Hazardous Materials or injury to the environment. 

     

    6

     

    

    
    


       Environmental Laws. Any and all applicable foreign,
federal, state and local environmental statutes, laws, regulations, ordinances,
policies and or common law (whether now existing or hereafter enacted or
promulgated), of all federal, state, local or other governmental authorities,
agencies, commissions, boards, bureaus or departments which may now or hereafter
have jurisdiction over the Borrower, any other member of the Borrower Affiliated
Group or any Real Property leased by the Borrower or such other member of the
Borrower Affiliated Group, and all applicable judicial and administrative and
regulatory decrees, judgments and orders, including common law rulings and
determinations, relating to injury to, or the protection of, the environment
(and related impacts on human health), including, without limitation, all
requirements pertaining to reporting, licensing, permitting, investigation,
remediation and removal of emissions, discharges, releases or threatened
releases of Hazardous Materials into the environment or relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials. 

     

       ERISA. The Employee Retirement Income Security
Act of 1974 and the rules and regulations thereunder, collectively, as the same
may from time to time be supplemented or amended and remain in effect.


     

       Event of Default. Any event described in Section 7.1.


     

       Excess Issuance. Any issuance of a requested Letter of
Credit such that, after issuance thereof, the sum of the Stated Amount of all
Letters of Credit outstanding (including the requested Letter of Credit), plus
the aggregate amount of all draws under outstanding Letters of Credit that have
not been reimbursed or added to the Loan Account as Revolving Credit Loans,
would (i) exceed the L/C Sublimit, or (ii) when added to the amount of Revolving
Credit Loans (including Swingline Loans) outstanding at such time, exceed the
Total Commitment in effect at such time. 

     

       Federal Funds Effective
Rate. For any day, a
fluctuating interest rate per annum equal to the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from 3 federal funds brokers
of recognized standing selected by the Administrative Agent. 

     

       Fee Letter. The letter agreement dated as of
February 26, 2004 among Fleet, Fleet Securities, Inc. and the Borrower.


     

       Foreign Bank. See Section 2.14. 

     

       GAAP. Generally Accepted Accounting
Principles in the United States of America, consistently applied. 

     

    7

     

    

    
    


       Guarantees. As applied to any Person, without
duplication, all guarantees, endorsements or other contingent or surety
obligations with respect to obligations of others whether or not reflected on
such Person’s Consolidated balance sheet, including any obligation to furnish
funds, directly or indirectly (whether by virtue of partnership arrangements, by
agreement to keep-well or otherwise), through the purchase of goods, supplies or
services, or by way of stock purchase, capital contribution, advance or loan, or
to enter into a contract for any of the foregoing, for the purpose of payment of
obligations of any other Person. 

     

       Hazardous Material. Any substance (i) the presence of which
requires or may hereafter require notification, investigation or remediation
under any Environmental Law; (ii) which is or becomes defined as a “hazardous
waste” or “hazardous material” or “hazardous substance” or “controlled
industrial waste” or “pollutant” or “contaminant” under any present or future
Environmental Law or amendments thereto including, without limitation, CERCLA,
and any applicable local statutes and the regulations promulgated thereunder;
(iii) which is toxic, explosive, corrosive, flammable, infectious, radioactive,
carcinogenic, mutagenic or otherwise hazardous and is or becomes regulated by
any governmental authority, agency, department, commission, board or
instrumentality of any foreign country, the United States, any state of the
United States, or any political subdivision thereof to the extent any of the
foregoing has or had jurisdiction over the Borrower or any other member of the
Borrower Affiliated Group or any Real Property leased by the Borrower or any
other member of the Borrower Affiliated Group; or (iv) without limitation, which
contains gasoline, diesel fuel or other petroleum products, asbestos, asbestos
containing materials (“ACM”), polychlorinated biphenyls (“PCB’s”), flammable
materials or radioactive material. 

     

       Income Taxes. Any franchise taxes, net income taxes
or any other taxes imposed on the net income of any Bank or the Administrative
Agent, including branch profits tax, minimum tax and other taxes imposed in lieu
of net income tax. 

     

       Indebtedness. As applied to any Person (but without
duplication), (i) all obligations for borrowed money or other extensions of
credit whether secured or unsecured, absolute or contingent, including, without
limitation, unmatured reimbursement obligations with respect to letters of
credit or guarantees issued for the account of or on behalf of such Person
(other than documentary letters of credit), and all obligations representing the
deferred purchase price of property, other than accounts payable and other
normal recurring accrued expenses in each case arising in the ordinary course of
business, (ii) all obligations evidenced by bonds, notes, debentures or other
similar instruments, (iii) all obligations secured by any mortgage, pledge,
security interest or other lien on property owned or acquired by such Person,
whether or not the obligations secured thereby shall have been assumed, (iv) all
obligations arising under Capitalized Leases and Synthetic Leases, (v) all
Guarantees, and (vi) all obligations that are immediately due and payable out of
the production from property now or hereafter owned or acquired by such Person.


     

       Initial Financial Statement. See
Section 4.7. 

     

    8

     

    

    
    


       Initial Funding
Date. The
Closing Date. 

     

       Insolvent or Insolvency. The occurrence of one or more of the
following events with respect to a Person: (i) dissolution (except as permitted
by Section 6.5); (ii) termination of existence (except as permitted by Section
6.5); (iii) insolvency within the meaning of the United States Bankruptcy Code
or other comparable foreign or domestic applicable statutes; (iv) such Person
generally not paying its debts as they become due or its inability to pay its
debts as they come due; (v) such Person having unreasonably small capital with
which to engage in its business, (vi) such Person having incurred Indebtedness
beyond its ability to pay such Indebtedness as it matures, (vii) such Person’s
failure to have assets (both tangible and intangible) having a present fair
salable value in excess of the amount required to pay the probable liability on
its then existing debts (whether matured or unmatured, liquidated or
unliquidated, absolute fixed or contingent), (viii) such Person’s application
for or consent to the appointment of, or the taking of possession by, a
receiver, custodian, trustee, liquidator or similar official of itself or of all
or a substantial part of its property, (ix) such Person’s making of a general
assignment for the benefit of its creditors, (x) commencement by such Person of
a voluntary case under the United States Bankruptcy Code (as now or hereafter in
effect), (xi) the taking or commencement by any Person of any case or proceeding
under any law relating to bankruptcy, insolvency, reorganization, winding-up or
composition or adjustment of debts, or any other law providing for the relief of
debtors, (xii) such Person’s failure to contest in a timely or appropriate
manner, or acquiescence in writing to, any petition filed against it in an
involuntary case under the United States Bankruptcy Code (as now or hereafter in
effect) or other comparable law, (xiii) such Person’s taking of any action under
the laws of its jurisdiction of incorporation or organization similar to any of
the foregoing or passing any board resolution or taking of any corporate action
for the purpose of effecting any of the foregoing; or (xiv) commencement of a
proceeding or case against such Person, without the application or consent of
such Person, in any court of competent jurisdiction, seeking (x) the
liquidation, reorganization, dissolution, winding up, or composition or
readjustment of such Person’s debts, (y) the appointment of a trustee, receiver,
custodian, liquidator or the like of it or of all or any substantial part of
such Person’s assets, or (z) similar relief in respect of it, under any law
relating to bankruptcy, insolvency, reorganization, winding-up or composition or
adjustment of debts or any other law providing for the relief of debtors, and
such proceeding or case shall continue undismissed, or unstayed and in effect,
for a period of 60 days; or an order for relief shall be entered in an
involuntary case under the United States Bankruptcy Code (as now or hereafter in
effect), against such Person; or action under the laws of the jurisdiction of
incorporation or organization of such Person similar to any of the foregoing
shall be taken with respect to such Person and shall continue unstayed and in
effect for any period of 60 days. 

     

       Interest Period.
With respect to each LIBOR Loan, the period commencing on the date of the making
or continuation of or conversion to such LIBOR Loan and ending one, two, three
or six months thereafter, subject to availability, as the Borrower may elect in
the applicable Notice of Borrowing or Conversion; provided that: 

     

    9

     

    

    
    

     

    
      	       	(i)	 	any Interest Period (other than an Interest Period determined
      pursuant to clause (iii) below) that would otherwise end on a day that is
      not a Business Day shall be extended to the next succeeding Business Day
      unless such Business Day falls in the next calendar month, in which case
      such Interest Period shall end on the immediately preceding Business
      Day;
	 	 
	 	(ii)	 	any Interest Period that begins on the last Business Day of a
      calendar month (or on a day for which there is no numerically
      corresponding day in the calendar month at the end of such Interest
      Period) shall, subject to clause (iii) below, end on the last Business Day
      of a calendar month;
	 	 
	 	(iii)	      	any Interest Period applicable to Revolving Credit Loans that would
      otherwise end after the Revolving Credit Maturity Date shall end on said
      Revolving Credit Maturity Date; and
	 	 
	 	(iv)	 	notwithstanding clause (iii) above, no Interest Period shall have a
      duration of less than one month; and if any Interest Period would be for a
      shorter period, such Interest Period shall not be available
      hereunder.


    

     

       Investment. As applied to any Person, (i) the
purchase or acquisition of any share of capital stock, partnership interest,
limited liability company membership interest, evidence of indebtedness or other
equity security of any other Person, (ii) any loan, advance or extension of
credit to, or contribution to the capital of, any other Person, (iii) any real
estate held primarily for sale or investment, (iv) any commodities futures
contracts held other than in connection with bona fide hedging transactions, (v)
any other investment in any other Person, and (vi) the making of any commitment
or acquisition of any option to perform any of the acts specified in clauses (i)
through (v) of this definition. 

     

       Issuing Bank. Fleet National Bank and any other Bank
which, at the Borrower’s request, agrees, in each such Bank’s sole discretion,
to become an Issuing Bank for the purpose of issuing Letters of Credit, and
their respective successors and assigns, in each case in such Bank’s separate
capacity as an issuer of Letters of Credit pursuant to Section 2.18. The
designation of any Bank as an Issuing Bank after the date hereof shall be
subject to the prior written consent of the Administrative Agent, which consent
shall not be unreasonably withheld. 

     

       L/C Sublimit. At
any time, an amount equal to $200,000,000 less (i) the sum of the Stated Amount
of all Letters of Credit outstanding at such time, less (ii) the aggregate
amount of all unreimbursed draws under outstanding Letters of Credit at such
time that have not been added to the Loan Account as Revolving Credit Loans.


     

       Leases or Lease. Any agreement granting a Person the
right to occupy space in a structure or real estate for any period of time, and
any Capitalized Lease, Synthetic Lease, or other lease of or agreement to use
personal property including, but not limited to, machinery, equipment, furniture
and fixtures, whether evidenced by written or oral lease, contract or other
agreement no matter how characterized. 

     

    10

     

    

    
    



         Letters of
Credit. Letters of
credit in the form customarily issued by the Issuing Bank as standby Letters of
Credit or documentary Letters of Credit, as the case may be, which are issued or
to be issued for the account of the Borrower by the Issuing Bank, under the
joint responsibilities of the Banks, upon the terms and subject to the
conditions contained in this Agreement. 

     

         LIBOR
Loan. Any Revolving
Credit Loan bearing interest at a rate determined with reference to the Adjusted
LIBOR Rate. 

     

         Loan. A Revolving Credit Loan or Swingline
Loan made to the Borrower by any Bank pursuant to Section II of this Agreement,
and “Loans” means all of such Revolving Credit Loans and Swingline Loans,
collectively. 

     

         Loan
Account. The account
or accounts on the books of the Administrative Agent in which will be recorded
Loans and advances (including issued and outstanding Letters of Credit) made by
the Banks to the Borrower pursuant to this Agreement, payments made on such
Loans and other appropriate debits and credits as provided by this Agreement.


     

         Loan
Documents.
Collectively, this Agreement, the Letters of Credit (and related documentation
and agreements, including any letter of credit application), the Subsidiary
Guarantees and the Fee Letter, together with all agreements, certificates and
other instruments delivered from time to time pursuant to or in connection with
any of the foregoing, and all schedules, exhibits and annexes thereto, as any of
the foregoing may from time to time be amended and in effect. 

     

         Majority
Banks. Any two or
more Banks whose aggregate Commitments constitute more than 50% of the Total
Commitment in effect at the relevant time of reference, or if the Commitments
have been terminated, any two or more Banks whose aggregate Loans and Letters of
Credit outstanding constitute more than 50% of the aggregate Loans and Letters
of Credit outstanding at the relevant time of reference. 

     

         Material Adverse
Effect. Any (a)
material adverse change in the business, assets or condition (financial or
otherwise) of the Borrower Affiliated Group taken as a whole, or (b) material
impairment of the ability of the Borrower Affiliated Group, taken as a whole, to
perform their obligations under the Loan Documents or of the Administrative
Agent’s or the Banks’ ability to enforce the Obligations. 

     

         Material
Indebtedness.
Indebtedness of the Borrower Affiliated Group to any person or persons in excess
of $25,000,000 in the aggregate. 

     

         Notice of Borrowing or
Conversion. See
Section 2.4. 

     

    11 

     

    

    
    


    
           Obligations. Any and all obligations of the Borrower
Affiliated Group to the Administrative Agent or any Bank (i) under the Loan
Documents of every kind and description (including obligations in respect of
Letters of Credit, the Fee Letter and fees under each thereof), direct or
indirect, absolute or contingent, primary or secondary, due or to become due,
now existing or hereafter arising, regardless of how they arise or by what
agreement or instrument, if any, and including obligations to perform acts and
refrain from taking action as well as obligations to pay money, and (ii) in
connection with any cash management arrangements or deposit accounts maintained
by any member of the Borrower Affiliated Group with the Administrative Agent or
any Bank pursuant to or in connection with any Loan Document or otherwise in
connection with the Revolving Credit Loans and the loan facilities contemplated
hereby.

    

     

         Participant. See Section 9.10. 

     

         PBGC. The Pension Benefit Guaranty
Corporation or any entity succeeding to any or all of its functions under ERISA.


     

         PCB. See definition of Hazardous Material.


     

         Permitted
Acquisition. Any
Acquisition by the Borrower or any other member of the Borrower Affiliated Group
that meets each of the following criteria: (i) the capital stock (or other
equity interests) or assets acquired in such Acquisition relates to a line of
business similar to the business in which the Borrower Affiliated Group is
engaged on the Closing Date, (ii) the board of directors (or other comparable
governing body) of the Person whose capital stock (or other equity interests) or
assets are being acquired has duly approved such Acquisition, (iii) in the case
of an Acquisition of the capital stock (or other equity interests) of another
Person, such Person shall become a wholly-owned direct or indirect Subsidiary of
the Borrower or, in the case of a merger, the Borrower or another member of the
Borrower Affiliated Group shall be the surviving entity of the merger with the
acquired Person, (iv) the Borrower shall notify the Administrative Agent of each
such Acquisition, and (v) no Default or Event of Default shall exist, in each
case both before and after giving effect to such Acquisition, as certified in a
pro forma compliance certificate substantially in
the form of Exhibit E hereto demonstrating compliance with the
covenants contained in Sections 6.7 and 6.8 both before and after giving effect
to the contemplated Acquisition and delivered by the Borrower to the
Administrative Agent within 5 days prior to completion of the contemplated
Acquisition. 

     

         Permitted
Encumbrances. See
Section 6.4. 

     

         Permitted
Investments. All (i)
Qualified Investments, and (ii) Investments in addition to Qualified Investments
that do not in the aggregate at any time exceed five percent (5%) of the
Borrower’s Consolidated Tangible Net Worth, determined as of the date of its
most recently completed fiscal quarter. 

     

         Person or person. An individual, a company, a
corporation, an association, a partnership, a joint venture, a limited liability
company or partnership, an unincorporated trade or business enterprise, a trust,
an estate, or a government (national, regional or local) or an agency,
instrumentality or official thereof. 

     

    12 

     

    

    
    


         Plan. At any time, an employee pension or
other benefit plan that is subject to Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Code and is either (i)
maintained by the Borrower, any Significant Subsidiary or any member of the
Controlled Group for employees of the Borrower, any Significant Subsidiary or
any member of the Controlled Group or (ii) if such Plan is established or
maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to which
the Borrower, any Significant Subsidiary or any member of the Controlled Group
is then making or accruing an obligation to make contributions or has within the
preceding five Plan years made contributions. 

     

         Prime
Rate. The greater of
(i) the variable per annum rate of interest so designated from time to time by
Fleet as its Prime Rate, or (ii) the Federal Funds Effective Rate plus 1/2 of 1%
per annum (rounded upwards, if necessary, to the next 1/8 of 1%). The Prime Rate
is a reference rate and does not necessarily represent the lowest or best rate
being charged to any customer. 

     

         Prime Rate
Loan. Any Revolving
Credit Loan bearing interest calculated by reference to the Prime Rate.


     

         Prohibited
Transaction. A
transaction prohibited by Section 4975 of the Code or Section 406 of ERISA, for
which no statutory or administrative exemption applies. 

     

         Qualified
Investments. As
applied to any member of the Borrower Affiliated Group,

     

         (a) Investments in wholly-owned
Subsidiaries that have executed and delivered to the Administrative Agent a
Subsidiary Guarantee;

     

         (b) Investments in Subsidiaries of
the Borrower that have not executed and delivered a Subsidiary Guarantee in an
aggregate amount outstanding not in excess of fifteen percent (15%) of the
Borrower’s Consolidated Tangible Net Worth determined as of the end of the most
recently completed fiscal quarter of the Borrower;

     

         (c) marketable direct or guaranteed
obligations of the United States of America and agencies thereof; 

     

         (d) demand deposits, certificates of
deposit, bankers acceptances and time deposits of (i) United States or Canadian
banks having total assets in excess of $2,000,000,000 or (ii) commercial banks
organized under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development (the “OECD”), or is a
political subdivision of such country, and having total assets in excess of
$2,000,000,000, provided, that such bank is acting through a branch or agency
located in the country in which it is organized or another country which is a
member of the OECD; 

     

    13 

     

    

    
    


    
           (e) (i) securities commonly known as
“commercial paper” denominated in U.S. Dollars which at the time of purchase
have been rated and the ratings for which are not less than “P1” if rated by
Moody’s, and not less than A1 if rated by Standard & Poors, and (ii)
securities commonly known as “short-term bank notes” issued by any bank
denominated in U.S. Dollars which at the time of purchase have been rated and
the ranges for which are not less than “P2” if rated by Moody’s, and not less
than “A2” if rated by Standard & Poors;

    

     

         (f) taxable or tax exempt securities
which at the time of purchase have been rated and the ratings for which are not
less than A3 if rated by Moody’s, and not less than A- if rated by Standard
& Poors; and 

     

         (g) guaranties by endorsement of
negotiable instruments for deposit or collection or similar transactions
effected in the ordinary course of business. 

     

         Rate
Period. The period
beginning on the third Business Day following delivery to the Administrative
Agent of the annual or quarterly financial statements required to be delivered
pursuant to Section 5.1(a) or Section 5.1(b) and ending on the second Business
Day after the day on which the next such quarterly (or annual, as applicable)
financial statements are delivered to the Administrative Agent. 

     

         Rating. The general corporate rating assigned
to the Borrower by a nationally recognized rating agency acceptable to the
Administrative Agent. 

     

         Real
Property or
Real Properties. Collectively, those parcels of land
together with the improvements now or hereafter located thereon which are owned
or leased by any member of the Borrower Affiliated Group. 

     

         Reportable
Event. With respect
to any Plan, a reportable event as described in Section 4043(c) of ERISA for
which notice to the PBGC has not been waived. 

     

         Reserve
Percentage. For any
Interest Period, the rate (expressed as a decimal) applicable to the
Administrative Agent during such Interest Period under regulations issued from
time to time by the Board of Governors of the Federal Reserve System for
determining the maximum reserve requirement (including, without limitation, any
basic, supplemental, emergency or marginal reserve requirement) of the
Administrative Agent with respect to “Eurocurrency liabilities” as that term is
defined under such regulations. 

     

         Restricted
Payment. (i) Any cash
or property dividend, distribution or payment, direct or indirect, by the
Borrower or any of its Subsidiaries in respect of its capital stock or other
equity interests to any Person who now holds, or who in the future holds, an
equity interest in the Borrower or any of its Subsidiaries, whether evidenced by
a security or not, other than dividends payable solely in shares of any class of
capital stock (or other equity) to holders of that class, and (ii) any payment
on account of the purchase, repurchase, redemption, retirement or other
acquisition for value of any capital stock of the Borrower or its Subsidiaries,
or any other payment or distribution made in respect thereof, either directly or
indirectly. 

     

    14 

     

    

    
    


         Revolving Credit
Commitment. In
relation to any Bank, without duplication, (i) the maximum amount of Revolving
Credit Loans that such Bank shall be committed to make to the Borrower, (ii) the
maximum amount of Swingline Loans that such Bank shall be committed to make to,
or to participate in, in favor of, the Borrower, and (iii) the maximum amount of
Letters of Credit which such Bank shall be committed to issue to, or to
participate in, in favor of, the Borrower, in each case upon the terms and
subject to the conditions contained in this Agreement, as set forth on
Schedule 1, as such Schedule 1 may be updated by the Administrative
Agent from time to time to reflect any changes in the Revolving Credit
Commitments as a result of assignments permitted by Section 9.10. 

     

         Revolving Credit Commitment
Percentage. With
respect to each Bank having a Revolving Credit Commitment, the percentage set
forth on Schedule 1 as such Bank’s percentage of the
aggregate Revolving Credit Commitments of all the Banks. Schedule 1 shall be updated by the Administrative
Agent from time to time to reflect any changes in the Revolving Credit
Commitment Percentages. 

     

         Revolving Credit
Loans. Collectively,
the loans in the maximum aggregate principal amount of up to the Total
Commitment made or to be made to the Borrower by the Banks pursuant to this
Agreement (including Section 2.1(a) hereof) and subject to the limitations
contained herein. 

     

         Revolving Credit Maturity
Date. March 30, 2009,
or such earlier date on which the Loans become due and payable pursuant to
Section 7.2 hereof. 

     

         Significant
Subsidiaries. Each
“significant” (as defined under Regulation S-X promulgated under the Securities
Exchange Act of 1934, as amended) domestic and foreign Subsidiary of the
Borrower.

     

         Stated
Amount. With respect
to each Letter of Credit outstanding at any time, the maximum amount then
available to be drawn thereunder (without regard to whether any conditions to
drawing could then be met). 

     

         Stockholders’
Equity. The amount
reported as “stockholders’ equity” on the Borrower’s Consolidated balance sheet
and determined in accordance with GAAP. 

     

         Subsidiary. With respect to any Person, a
corporation, partnership, limited liability company, association, joint stock
company, business trust or other similar organization of which 50% or more of
the ordinary voting power for the election of a majority of the members of the
board of directors or other governing body of such entity is held or controlled
by such Person or a Subsidiary of such Person; or any other such organization
the management of which is directly or indirectly controlled by such Person or a
Subsidiary of such Person through the exercise of voting power or otherwise; or
any joint venture, whether incorporated or not, in which a Person has a 50% or
more ownership interest. 

     

    15 

     

    

    
    


         Subsidiary
Guarantees. The
Guarantees to be made from time to time by each Significant Subsidiary of the
Borrower in favor of the Agent, each substantially in the form of Exhibit G hereto. 

     

         Swingline
Commitment. The
obligation of the Swingline Lender to make Swingline Loans to the Borrower in a
maximum principal amount not exceeding at any time the amount set forth opposite
the Swingline Lender’s name on Schedule 1 hereto. On the Closing Date, the
Swingline Commitment shall be $60,000,000. 

     

         Swingline
Lender. Fleet, in its
capacity as swingline lender hereunder, or any successor Administrative Agent.


     

         Swingline
Loans. Collectively,
the loans in the maximum aggregate principal amount of the Swingline Commitment
made or to be made by the Swingline Lender to the Borrower pursuant to Section
2.1(b) of this Agreement and subject to the limitations contained herein.


     

         Swingline Termination
Date. The Revolving
Credit Maturity Date. 

     

         Synthetic
Lease. Any synthetic
lease, tax retention operating lease, off-balance sheet loan or similar
off-balance sheet financing product where such transaction is considered
borrowed money Indebtedness for tax purposes but is classified as an operating
lease under GAAP and including the leases for the distribution facilities
located in Fort Hill, South Carolina, and Perris, California regardless of how
such leases may from time to time be classified under GAAP. 

     

         Total
Commitment. As of any
date, the sum of the then-current Commitments of the Banks. As of the date of
this Agreement, the Total Commitment (including the Swingline Commitment) shall
not exceed $600,000,000.

     

         UCP 500. See Section 2.18(a). 

     

         Uniform Commercial
Code. The Uniform Commercial Code as in effect
from time to time in any applicable jurisdiction. 

     

         United States Bankruptcy
Code. 11 U.S.C.
§§101-1330. 

     

         Utilization. For any day, the aggregate principal
amount of all Revolving Credit Loans outstanding (including Swingline Loans but
excluding outstanding Letters of Credit) on such day. 

     

         Utilization
Fee. The utilization
fee payable by the Borrower to the Administrative Agent for the account of the
Banks pursuant to Section 2.10. 

     

    16 

     

    

    
    


         1.2. Terms of General
Application. For all
purposes of this Agreement and the other Loan Documents, except as otherwise
expressly provided herein or therein or unless the context otherwise requires:


     

         (i) references to any Person defined
in this Agreement refer to such Person and its successor in title and permitted
assigns or, for natural persons, such Person’s successors, heirs, executors,
administrators and other legal representatives;

     

         (ii) references to any agreement,
instrument or document defined in this Agreement refer to such document as
originally executed, or if subsequently varied, extended, renewed, modified,
amended, restated or supplemented from time to time, as so varied, extended,
renewed, modified, amended, restated or supplemented and in effect at the
relevant time of reference thereto; 

     

         (iii) words importing the singular
only shall include the plural and vice versa, and the words importing the masculine
gender shall include the feminine gender and vice versa, and all references to dollars, $, U.S.
Dollars or United States Dollars, shall be to Dollars; 

     

         (iv) accounting terms not otherwise
defined in this Agreement or any of the other Loan Documents have the meanings
assigned to them in accordance with GAAP, on a basis consistent with the
financial statements referred to in Section 4.7 of this Agreement; 

     

         (v) all financial statements and
other financial information provided by the Borrower and each other member of
the Borrower Affiliated Group, to the Administrative Agent or any Bank shall be
provided with reference to Dollars;

     

         (vi) this Agreement and the other
Loan Documents are the result of negotiation among, and have been reviewed by
counsel to, among others, the Borrower Affiliated Group and the Administrative
Agent and are the product of discussions and negotiations among all parties.
Accordingly, this Agreement and the other Loan Documents are not intended to be
construed against the Administrative Agent or any of the Banks merely on account
of the Administrative Agent’s or any Bank’s involvement in the preparation of
such documents; and 

     

         (vii) all references to a time of
day shall mean the time then prevailing in Boston, Massachusetts, unless
otherwise indicated. 

     

    17 

     

    

    
    


    
      SECTION II 

       

      DESCRIPTION OF CREDIT 

       

           2. The Credit Facilities. 

       

           2.1. The Loans. 

       

           (a) Revolving Credit Loans. Subject to the terms and conditions set
forth in this Agreement, each of the Banks severally agrees to lend to the
Borrower, and the Borrower may borrow (and may repay and reborrow) from time to
time between the Closing Date and the Revolving Credit Maturity Date, such
amounts as are requested by the Borrower up to a maximum aggregate principal
amount outstanding (after giving effect to all amounts requested) at any one
time equal to such Bank’s Revolving Credit Commitment; provided, however, that the maximum aggregate principal
amount of all Revolving Credit Loans outstanding (after giving effect to the
amounts requested), plus the aggregate principal amount of all
Swingline Loans outstanding, plus the aggregate Stated Amount of Letters
of Credit outstanding at such time, plus the aggregate amount of all unreimbursed
draws under outstanding Letters of Credit, shall not at any time exceed the
Total Commitment in effect at such time; and provided, further, that at the time the Borrower requests
a Revolving Credit Loan and after giving effect to the making thereof, no
Default or Event of Default has occurred and is
continuing.

    

     

         The Revolving Credit Loans (but not
the Swingline Loans) shall be made pro rata among the Banks in accordance with the
Revolving Credit Commitment Percentage of each Bank having a Revolving Credit
Commitment. If the aggregate principal amount of Revolving Credit Loans
outstanding at any time, plus the aggregate principal amount of all
Swingline Loans outstanding, plus the aggregate Stated Amount of Letters
of Credit outstanding at such time, plus the aggregate amount of any unreimbursed
draws under outstanding Letters of Credit shall at any time exceed the Total
Commitment then in effect, the Borrower shall immediately pay to the
Administrative Agent for the respective accounts of the Banks the amount of such
excess. Any such payment shall be applied first to repay any outstanding
Swingline Loans, and any remainder shall be applied to outstanding Revolving
Credit Loans. Failure to make such payment on demand shall be an Event of
Default hereunder. 

     

         (b) Swingline Loans. 

     

              (i)
Availability. Subject to the terms and conditions of
this Agreement, the
Swingline Lender agrees to make Swingline Loans to the Borrower from time to
time from the Closing Date through, but not including, the Swingline Termination
Date; provided, that the aggregate principal amount of
all outstanding Swingline Loans (after giving effect to any amount requested) at
any time, shall not exceed the lesser of: 

     

    
      	          	
                   (x) the Total Commitment in
      effect at such time less the sum of (A) all outstanding
      Revolving Credit Loans at such time, (B) the aggregate Stated Amount of
      Letters of Credit outstanding at such time, and (C) the aggregate amount
      of all unreimbursed draws under outstanding Letters of Credit at such
      time, and

               

                   (y) the Swingline Commitment
      at such time; 

            


    

     

    18 

     

    

    
    


    
      and provided further that after the Swingline Lender has
received written notice from any Bank that a Default or Event of Default has
occurred and stating that no new Swingline Loans are to be made during the
continuance of such Default or Event of Default, the Swingline Lender shall not
make any Swingline Loans until such Default or Event of Default has been cured
or waived in accordance with the provisions of this Agreement. Swingline Loans
hereunder may be used in anticipation of borrowing Revolving Credit Loans and
for other short-term requirements, may be requested for a period of up to 10
days, and shall be repaid and may be reborrowed in accordance with the terms
hereof. Each Swingline Loan must be for an amount equal to at least $500,000.
The Swingline Lender shall initiate the transfer of funds representing the
Swingline Loan to the Borrower by 4:00 p.m. on the Business Day of the requested
borrowing, so long as the Swingline Loan has been requested by the Borrower no
later than 3:00 p.m. on such Business Day. 

    

     

              (ii)
Repayment. The Borrower hereby absolutely and
unconditionally promises to repay the outstanding principal amount of each
Swingline Loan on the earliest to occur of: (x) the tenth day after the date on
which such Swingline Loan was made, (y) the Swingline Termination Date or (z)
demand by the Swingline Lender pursuant to Section 2.1(b)(iii) hereof.


     

              (iii)
Refunding and Conversion of Swingline
Loans to Revolving Credit Loans. 

     

                   (A)
Unless the Borrower has otherwise elected the conversion of a Swingline Loan
into a LIBOR Loan in accordance with Section 2.4, and so long as the conditions
of Section 3.2 (other than Section 3.2(a)) have been met, on the maturity of
each Swingline Loan (which shall be no longer than ten (10) days after the
making of such Swingline Loan), the Borrower shall be deemed to have requested
on such date a Revolving Credit Loan comprised solely of Prime Rate Loans in the
principal amount of such Swingline Loan. Such refundings of the Swingline Loan
through the funding of such Revolving Credit Loans shall be made by the Banks in
accordance with their respective Revolving Credit Commitment Percentages
applicable to Revolving Credit Loans and shall thereafter be reflected as
Revolving Credit Loans of the Banks on the books and records of the
Administrative Agent. 

     

                   (B)
If an Event of Default has occurred and is continuing, Swingline Loans shall be
refunded by the Banks on demand by the Swingline Lender, in which case the
Borrower shall be deemed to have requested on such date of demand a Revolving
Credit Loan comprised solely of Prime Rate Loans in the principal amount of such
Swingline Loan. Such refundings of the Swingline Loan through the funding of
such Revolving Credit Loans shall be made by the Banks in accordance with their
respective Revolving Credit Commitment Percentages applicable to Revolving
Credit Loans and shall thereafter be reflected as Revolving Credit Loans of the
Banks on the books and records of the Administrative Agent (including the Loan
Account). Each Bank shall fund its respective Revolving Credit Commitment
Percentage of Revolving Credit Loans as required to repay Swingline Loans
outstanding to the Swingline Lender upon such demand by the Swingline Lender but
in no event later than 2:00 p.m. on the next succeeding Business Day after such
demand is made. No Bank’s obligation to fund its respective Revolving Credit
Commitment Percentage of the repayment of a Swingline Loan shall be affected by
any other Bank’s failure to fund its Revolving Credit Commitment Percentage of
such repayment, nor shall any Bank’s Revolving Credit Commitment Percentage be increased as a
result of any such failure of any other Bank to fund its Revolving Credit
Commitment Percentage. To the extent any Bank does not fund its respective
Revolving Credit Commitment Percentage of any Revolving Credit Loan deemed to be
made to the Borrower pursuant to this Section, such Bank shall be deemed a
Delinquent Bank and the Borrower shall repay such amounts to the Swingline
Lender in accordance with the provisions of Section 8.3(c) as if such Loan were
a Revolving Credit Loan for which a Bank did not advance its share to the
Administrative Agent. 

     

    19 

     

    

    
    


                   (C)
The Borrower hereby authorizes the Administrative Agent to charge any account
maintained with the Swingline Lender (up to the amount available therein) in
order to immediately pay the Swingline Lender the amount of any Swingline Loans
(x) to the extent amounts received from the Banks are not sufficient to repay in
full the outstanding Swingline Loans required to be refunded pursuant to Section
2.1(b)(iii)(B), and (y) to satisfy the Borrower’s obligations pursuant to clause
(D) below. If any portion of any such amount paid to the Swingline Lender shall
be recovered by or on behalf of the Borrower from the Swingline Lender in
bankruptcy or otherwise, the loss of the amount so recovered shall be shared
among all the Banks in proportion to their respective Revolving Credit
Commitment Percentages for Revolving Credit Loans. 

     

                   (D)
If at any time the Borrower receives notice from the Swingline Lender that the
aggregate principal amount of all Revolving Credit Loans outstanding, plus the
aggregate principal amount of all Swingline Loans outstanding (including the
Swingline Loan for which demand for payment is then made by the Swingline Lender
pursuant to this subsection), plus the aggregate Stated Amount of Letters of
Credit outstanding at such time, plus the aggregate of all unreimbursed draws
under outstanding Letters of Credit, equals or exceeds the Total Commitment at
such time, the Borrower shall repay the amount of such excess upon demand by the
Swingline Lender, which payment shall be applied first to the Swingline Loans
and thereafter to the other Obligations.

     

                   (E)
Each Bank acknowledges and agrees that its obligation to refund Swingline Loans
with Revolving Credit Loans in accordance with the terms of this Section 2.1(b)
is absolute and unconditional and shall not be affected by any circumstance
whatsoever, including, in any event, non-satisfaction of the conditions set
forth in Section 2.1(a) or Article III. Further, each Bank having a Revolving
Credit Commitment agrees and acknowledges that if, prior to the refunding of any
outstanding Swingline Loans pursuant to this Section 2.1(b), one of the events
described in Section 7.1(f) shall have occurred, each Bank will, on the date the
applicable Revolving Credit Loan would have been made pursuant to Section
2.1(b)(iii) hereof, purchase an undivided participating interest in the
Swingline Loan to be refunded in an amount equal to its Revolving Credit
Commitment Percentage (applicable to Revolving Credit Loans) of the aggregate
amount of such Swingline Loan. Each Bank will immediately transfer to the
Swingline Lender, in immediately available funds, the amount of its
participation. Whenever, at any time after the Swingline Lender has received
from any Bank such Bank’s participating interest in a Swingline Loan, the
Swingline Lender receives any payment on account thereof, the Swingline Lender
will distribute to such Bank its participating interest in such amount (appropriately adjusted, in the
case of interest payments, to reflect the period of time during which such
Bank’s participating interest was outstanding and funded). 

     

    20 

     

    

    
    


                   (F)
Each Bank’s Revolving Credit Commitment Percentage applicable to any Swingline
Loan shall be identical to its Revolving Credit Commitment Percentage applicable
to Revolving Credit Loans. 

     

         2.2 Records.

     

         (a) Banks’ Records. Each Bank will note (manually or
electronically) on its records with respect to each Loan made by it (i) the date
and amount of such Loan, (ii) whether such Loan is a Revolving Credit Loan or a
Swingline Loan, (iii) the interest rate and Interest Period, if any, applicable
to such Loan, and (iv) each payment and prepayment of the principal thereof.


     

         (b) Administrative Agent’s
Records. The
Administrative Agent shall keep records regarding the Loans, the Letters of
Credit and this Agreement in accordance with its customary procedures for
agented credits. 

     

         (c) Prima Facie Evidence. The entries made in the records
maintained pursuant to subsections (a) and (b) above shall, to the extent not
prohibited by applicable law, be prima facie evidence of the existence and amount of
the obligations of the Banks and Borrower recorded therein; provided, however,
that the failure of the Administrative Agent or any Bank, as the case may be, to
make any notation on its records shall not affect the Borrower’s obligations in
respect of the Loans, the Letters of Credit or this Agreement. 

     

         2.3. Conversion. Provided that no Event of Default shall
have occurred and be continuing, and subject to and in accordance with the
provisions of Section 2.4(a), the Borrower may convert all or any part (in
integral multiples of $500,000) of any outstanding Loan into a Loan of the other
type provided for in this Agreement on any Business Day (which, in the case of a
conversion of a LIBOR Loan, shall be the last day of the Interest Period
applicable to such LIBOR Loan). The Borrower shall give the Administrative Agent
and the Banks prior notice of each such conversion in accordance with Section
2.4. All such conversions shall be made pro rata in accordance with each Bank’s
Revolving Credit Commitment Percentage applicable to the type of Loan being
converted. 

     

         2.4. Notice and Manner of Borrowing or
Conversion of Loans.


     

         (a) Whenever the Borrower desires to
obtain or continue a Loan hereunder or convert an outstanding Loan into a Loan
of the other type provided for in this Agreement, the Borrower shall notify the
Administrative Agent (which notice shall be irrevocable) by telecopy or
telephone (i) received no later than 1:00 p.m. on the date that is one (1)
Business Day before the day on which the requested Loan is to be made or
continued as or converted to a
Prime Rate Loan, (ii) received no later than 3:00 p.m. on the day on which a
Swingline Loan is to be made, and (iii) received no later than 1:00 p.m. on the
date that is three (3) Business Days before the day on which the requested Loan
is to be made or continued as or converted to a LIBOR Loan, provided that no more than ten (10) LIBOR Loans
may be outstanding at any one time. Such notice by the Borrower shall specify
(i) the effective date and amount of each Loan to be obtained, continued or
converted (or portion thereof to be continued or converted, as the case may be),
subject to the limitations set forth in Section 2.1, (ii) the interest rate
option to be applicable thereto, and (iii) the duration of the applicable
Interest Period, if any (subject to the provisions of the definition of Interest
Period and Section 2.8). Each LIBOR Loan must be for an amount equal to at least
$500,000 and in additional increments of $500,000. Each such notification by
telephone pursuant to Section 2.3 or this Section 2.4(a) (a “Notice of Borrowing
or Conversion”) shall be immediately followed by a written confirmation thereof
by the Borrower in substantially the form of Exhibit A hereto, provided that if such written confirmation
differs in any material respect from the action taken by the Administrative
Agent, the records of the Administrative Agent shall be prima facie evidence thereof. 

     

    21 

     

    

    
    


         (b) Subject to the terms and
conditions hereof, (i) each Bank shall make available to the Administrative
Agent, in immediately available funds, no later than 1:00 p.m., on the date upon
which any Prime Rate Loan or LIBOR Loan is to be made, such Bank’s Revolving
Credit Commitment Percentage of the requested Loan, and (ii) the Swingline
Lender shall make available to the Administrative Agent, in immediately
available funds, no later than 4:00 p.m., on the date upon which any Swingline
Loan is to be made, the amount of such Swingline Loan to be made on such date.
The Administrative Agent shall, in turn, make each Loan on the effective date
specified therefor by crediting the amount of such Loan to the Borrower’s demand
deposit account with the Administrative Agent or to such other account directed
by the Borrower in the Notice of Borrowing or Conversion. In no event shall the
Administrative Agent (in its capacity as Administrative Agent) have any
obligation to make any funding or shall any Bank be obligated to fund more than
its Revolving Credit Commitment Percentage of the requested Prime Rate Loan or
LIBOR Loan. Revolving Credit Loans to be made for the purpose of refunding
Swingline Loans shall be
made by the Banks as provided in Section 2.1(b) hereof. 

     

         2.5. Commitment Fee. The Borrower shall pay to the
Administrative Agent, for the accounts of the Banks in accordance with their
respective Revolving Credit Commitment Percentages, from the Closing Date
through the Revolving Credit Maturity Date, a commitment fee (the “Commitment
Fee”) computed at the rate per annum equal to the Applicable Commitment Fee Rate
on the average daily amount of the unborrowed portion of the Revolving Credit
Commitments during each quarter or portion thereof. Commitment Fees shall be
payable quarterly in arrears, on the last day of March, June, September and
December of each year, and on the Revolving Credit Maturity Date. The
Administrative Agent shall, at least three (3) Business Days prior to the last
day of each such quarter, provide to the Borrower an estimated invoice
reflecting the estimated amount of the Commitment Fees due for such quarter,
which such estimate shall be updated by the Administrative Agent on the last day
of such quarter. For purposes of calculating the Commitment Fee, outstanding
Letters of Credit shall be included in determining the utilization of the Revolving Credit Commitments, but
Swingline Loans shall constitute utilization of the Revolving Credit Commitments
only as between the Swingline Lender and the Borrower. 

     

    22 

     

    

    
    


         2.6. Fee Letter. The Borrower shall pay to the
Administrative Agent fees in the amounts and at the times outlined in the Fee
Letter. 

     

         2.7. Reduction of Revolving Credit
Commitment. The
Borrower may from time to time by written notice delivered to the Administrative
Agent at least five (5) Business Days prior to the date of the requested
reduction, reduce by a minimum amount of $5,000,000, and in additional
increments of $1,000,000, any unborrowed portion of the Revolving Credit
Commitment. No reduction of the Revolving Credit Commitment shall be subject to
reinstatement.

     

         2.8. Duration of Interest
Periods.


     

         (a) Subject to the provisions of the
definition of “Interest Period,” the duration of each Interest Period applicable
to a LIBOR Loan shall be as specified in the applicable Notice of Borrowing or
Conversion. The Borrower shall have the option to elect a subsequent Interest
Period to be applicable to such Loan by giving notice of such election to the
Bank received no later than 10:00 a.m. time on the date that is three (3)
Business Days before the end of the then applicable Interest Period if such Loan
is to be continued as or converted to a LIBOR Loan. 

     

         (b) If the Administrative Agent does
not receive a notice of election of duration of an Interest Period for a LIBOR
Loan pursuant to subsection (a) above within the applicable time limits
specified therein, or if, when such notice must be given, an Event of Default
exists, the Borrower shall be deemed to have elected to convert such Loan in
whole into a Prime Rate Loan on the last day of the then current Interest Period
with respect thereto. 

     

         (c) Notwithstanding the foregoing,
the Borrower may not select an Interest Period that would end, but for the
provisions of the definition of Interest Period, after the Revolving Credit
Maturity Date. 

     

         2.9. Interest Rates and Payments of
Interest.


     

         (a) (i) Each Revolving Credit Loan
which is a Prime Rate Loan shall bear interest on the outstanding principal
amount thereof at a rate per annum equal to the Prime Rate, which rate shall
change contemporaneously with any change in the Prime Rate. Such interest on
Revolving Credit Loans shall be payable, and the Borrower hereby absolutely and
unconditionally promises to pay such interest, quarterly in arrears on the last
day of March, June, September and December of each year, and when such Loan is
due (whether at maturity, by reason of acceleration or otherwise). (ii) Each
Swingline Loan shall bear interest at a fixed rate quoted to the Borrower by the
Swingline Lender in its discretion, provided that such quoted rate shall not exceed
the Prime Rate in effect on the day of quotation. Interest on Swingline Loans shall be payable, and the Borrower
hereby absolutely and unconditionally promises to pay such interest, when such
Swingline Loan is due and payable, or when such Swingline Loan is actually paid,
if earlier. 

     

    23 

     

    

    
    


         (b) Each Revolving Credit Loan which is a LIBOR Loan shall bear interest
on the outstanding principal amount thereof, for each Interest Period applicable
thereto, at a rate per annum equal to the Adjusted LIBOR Rate plus the
Applicable LIBOR Margin. Such interest shall be payable, and the Borrower hereby
absolutely and unconditionally promises to pay such interest, for such Interest
Period (i) on the last day of such Interest Period and, if such Interest Period
is six (6) months, at the end of the third month after the first day of such
Interest Period and (ii) when such LIBOR Loan is due (whether at maturity, by
reason of acceleration or otherwise).

     

         (c) For purposes of this Section 2.9
(but subject to increase pursuant to Section 2.10 with respect to the Applicable
LIBOR Margin), the “Applicable LIBOR Margin” and the “Applicable Commitment Fee
Rate” shall be equal to (A) from the Closing Date through the six-month period
following the Closing Date, the Applicable LIBOR Margin and the Applicable
Commitment Fee Rate set forth in Level III below, and (B) thereafter, the
percentage determined for each Rate Period by reference to Table 1 below based on the higher (by Level
number) of the following two Levels: (i) the Level applicable to the Borrower
under the heading “Rating” or (ii) the Level applicable to the Borrower under
the heading “Adjusted Interest Coverage Ratio”: 

     

    Table 1 

     

    
      	
            	
            	
            	
            	
            	
            	Applicable	
            	Applicable
	 	     	 	     	 	     	LIBOR	     	Commitment Fee
	Level	
            	Rating	
            	Adjusted Interest
      Coverage Ratio	
            	Margin*	
            	Rate
	I)	
            	<BBB-	
            	less than 2.5 to 1	 	1.125%	
            	0.175%
	II)	
            	BBB-	
            	greater than or equal to 2.50 to 1 but	
            	
            	
            	
            
	
            	 	 	
            	less than 3.0 to 1	
            	0.875%	 	0.150%
	III)	
            	BBB	 	greater than or equal to 3.0 to 1
      but	
            	
            	
            	
            
	
            	
            	
            	
            	less than 4.0 to 1	
            	0.750%	
            	0.150%
	IV)	
            	BBB+	
            	greater than or equal to 4.0 to 1 but	
            	
            	
            	
            
	
            	
            	
            	
            	less than 5.0 to 1	
            	0.625%	
            	0.125%
	V)	
            	greater than	
            	
            	
            	
            	
            	
            
	
            	
            	or equal to A-	
            	greater than or equal to 5.0 to
      1	
            	0.500%	
            	0.125%


    


    *Subject to the
Utilization Fee set forth in Section 2.10. 

     

    24 

     

    

    
    


    
      
        For purposes of
determining the Applicable LIBOR Margin and the Applicable Commitment Fee Rate,
the Adjusted Interest Coverage Ratio will be tested quarterly on a rolling
four-quarter basis, based on the financial statements and compliance certificate
required to be delivered pursuant to Sections 5.1(a), 5.1(b) and 5.1(c),
respectively. For purposes of determining the interest rate for any Rate Period
hereunder, any interest rate change shall be effective three (3) Business Days
after the date on which the financial statements and compliance certificate
required to be delivered pursuant to Sections 5.1(a), 5.1(b) and 5.1(c),
respectively, are delivered to the Administrative Agent, together with a notice
to the Administrative Agent (which shall be verified by the Administrative
Agent) specifying any change in the Applicable LIBOR Margin, and if the Borrower
has failed to deliver the financial statements and compliance certificate
required to be delivered pursuant to Sections 5.1(a), 5.1(b) and 5.1(c),
respectively, the Applicable LIBOR Margin that would be in effect at the time
the statements were due shall automatically be increased by .25% until such
compliance certificate is delivered.

      

    

     

         (d) The Administrative Agent shall, at least three (3) Business Days
prior to the date upon which any interest is to become due hereunder, provide to
the Borrower an estimated invoice reflecting the estimated amount of the
interest due, which estimate shall be updated by the Administrative Agent on the
due date thereof. 

     

         2.10. Utilization Fee. For each day on which Utilization
exceeds 50% of the Total Commitment as in effect on such day, there shall be a
utilization fee payable (the “Utilization Fee”) to the Administrative Agent for
the ratable account of the Banks, on the aggregate amount of all Revolving
Credit Loans (including Swingline Loans) outstanding on such day. The
Utilization Fee shall be computed for each such day at the rate of 0.125% per
annum and shall be payable quarterly in arrears on the last day of March, June,
September and December of each year and on the Revolving Credit Maturity Date.
The Administrative Agent shall, at least three (3) Business Days prior to the
last day of each quarter, provide to the Borrower an estimated invoice
reflecting the estimated amount of the Utilization Fee due for such quarter,
which estimate shall be updated by the Administrative Agent on the last day of
such quarter. 

     

         2.11. Protective Provisions. 

     

         2.11.1. Inability to Determine Adjusted LIBOR
Rate. In the event,
prior to the commencement of any Interest Period relating to any LIBOR Loan, the
Administrative Agent shall determine or be notified by the Majority Banks that
adequate and reasonable methods do not exist for ascertaining the Adjusted LIBOR
Rate that would otherwise determine the rate of interest to be applicable to any
LIBOR Loan during such Interest Period, the Administrative Agent shall forthwith
give notice of such determination (which shall be conclusive and binding on the
Borrower and the Banks) to the Borrower and the Banks. In such event (a) any
Notice of Borrowing or Conversion with respect to LIBOR Loans shall be
automatically withdrawn and shall be deemed a request for Prime Rate Loans, (b)
each LIBOR Loan will automatically, on the last day of the then current Interest
Period relating thereto, become a Prime Rate Loan, and (c) the obligations of
the Banks to make LIBOR Loans shall be suspended until the Administrative Agent
or the Majority Banks, as applicable, determine that the circumstances giving
rise to such suspension no longer exist, whereupon the Administrative Agent or,
as the case may be, the Administrative Agent upon the
instruction of the Majority Banks, shall so notify the Borrower and the
Banks.

     

    25 

     

    

    
    


         2.11.2. Illegality.
Notwithstanding any other provisions herein, if any present or future law,
regulation, treaty or directive or the interpretation or application thereof
shall make it unlawful for any Bank to make or maintain LIBOR Loans, such Bank
shall forthwith give notice of such circumstances to the Borrower and the other
Banks and thereupon the commitment of such Bank to make LIBOR Loans or convert
Prime Rate Loans to LIBOR Loans shall forthwith be suspended and such Bank’s
LIBOR Loans then outstanding as LIBOR Loans, if any, shall be converted
automatically to Prime Rate Loans on the last day of each Interest Period
applicable to such LIBOR Loans or within such earlier period as may be required
by law. The Borrower hereby agrees promptly to pay the Administrative Agent for
the account of such Bank, upon demand by such Bank, any additional amounts
necessary to compensate such Bank for any costs incurred by such Bank in making
any conversion in accordance with this Section 2.11.2, including any interest or
fees payable by such Bank to lenders of funds obtained by it in order to make or
maintain its LIBOR Loans hereunder. Before giving any notice to the Borrower and
the other Banks under this Section, the affected Bank shall designate a
different lending office with respect to its LIBOR Loans if such designation
would avoid the need for giving such notice and would not, in the judgment of
such Bank, be illegal or otherwise disadvantageous to the
Bank.

     

         2.11.3. Additional Costs,
etc. After the Closing Date, if any Change in Law
shall:

     

         (a) subject any Bank or the
Administrative Agent to any tax, levy, impost, duty, charge, fee, deduction or
withholding of any nature with respect to this Agreement, the other Loan
Documents, such Bank’s Revolving Credit Commitment or Loans (other than Covered
Taxes and Income Taxes); or

     

         (b) materially change the basis of
taxation (except for changes in Income Taxes of such Bank or the Administrative
Agent) of payments to any Bank of the principal of or the interest on any Loans
or any other amounts payable to any Bank or the Administrative Agent under this
Agreement or any of the other Loan Documents; or

     

         (c) without duplication of any amount
required to be paid pursuant to Section 2.12, impose or increase or render
applicable (other than to the extent specifically provided for elsewhere in this
Agreement) any special deposit, reserve, assessment, liquidity or other similar
requirements (whether or not having the force of law) against assets held by, or
deposits in or for the account of, or loans by, or letters of credit issued by,
or commitments of an office of any Bank; or

     

         (d) impose on any Bank or the
Administrative Agent any other conditions or requirements with respect to this
Agreement, the other Loan Documents, the Loans, such Bank’s Revolving Credit
Commitment, or any class of Loans or commitments of which any of the Loans or
such Bank’s Revolving Credit Commitment forms a part; and the result of any of
the foregoing is:

     

    26

     

    

    
    


             (i) to increase the cost to any Bank of
making, funding, issuing, renewing, extending or maintaining any of the LIBOR
Loans or such Bank’s Revolving Credit Commitment; or

     

             (ii) to reduce the amount of principal,
interest, or other amount payable to such Bank or the Administrative Agent
hereunder on account of such Bank’s Revolving Credit Commitment or any of the
LIBOR Loans; or

     

             (iii) to require such Bank or the
Administrative Agent to make any payment or to forego any interest or other sum
payable hereunder in relation to LIBOR Loans, the amount of which payment or
foregone interest or other sum is calculated by reference to the gross amount of
any sum receivable or deemed received by such Bank or the Administrative Agent
from the Borrower hereunder,

     

    then, in each such case and to the extent
that the amount of such additional cost, reduction, payment, foregone interest
or other sum is not reflected in the Adjusted LIBOR Rate, the Borrower will,
upon demand made by such Bank (with a copy to the Administrative Agent) or (as
the case may be) the Administrative Agent at any time and from time to time and
as often as the occasion therefor may arise, pay to such Bank or the
Administrative Agent such additional amounts as will be sufficient to compensate
such Bank or the Administrative Agent for such additional cost, reduction,
payment or foregone interest or other sum (without duplication for recovery of
such amounts under any other provision hereof), provided, that the Borrower shall
not be liable to any Bank or the Administrative Agent for costs incurred more
than ninety (90) days prior to the receipt by the Borrower of such demand for
payment from such Bank or (as the case may be) the Administrative Agent unless
such costs were incurred prior to such 90-day period solely as a result of such
change in present or future applicable law being retroactive to a date which
occurred prior to such 90-day period.

     

         2.12. Capital Requirements. If after the
date hereof the Administrative Agent or any Bank determines that (i) the
adoption of or change in any law, rule, regulation or guideline regarding
capital requirements for banks or bank holding companies, or any change in the
interpretation or application thereof by any governmental authority charged with
the administration thereof, or (ii) compliance by the Administrative Agent or
any Bank or its parent bank holding company with any guideline, request or
directive of any such authority regarding capital adequacy (whether or not
having the force of law), has the effect of reducing the return on the
Administrative Agent’s or such Bank’s or such holding company’s capital as a
consequence of the Administrative Agent’s or such Bank’s commitment to make
Loans hereunder and other commitments of the type hereunder to a level below
that which the Administrative Agent or such Bank or such holding company could
have achieved but for such adoption, change or compliance (taking into
consideration the Administrative Agent’s or such Bank’s or such holding
company’s then existing policies with respect to capital adequacy and assuming
the full utilization of such entity’s capital) by any amount deemed by the
Administrative Agent or such Bank to be material, then the Administrative Agent
shall promptly notify the Borrower thereof. The Borrower agrees to pay to the
Administrative Agent or such Bank the amount of such reduction of capital as and
when such reduction is determined, upon presentation by the Administrative Agent
or such Bank of a written statement in the amount and setting forth in
reasonable detail the Administrative Agent’s or such Bank’s calculation thereof,
which statement shall be deemed true and correct absent manifest error. In
determining such amount, the Administrative Agent or such Bank may use any
reasonable averaging and attribution methods.

     

    27

     

    

    
    


         Upon the receipt by the Borrower from any
Bank (an “Affected Bank”) of a claim for compensation under Section 2.11, this
Section 2.12 or Section 2.14, which claim shall be delivered to the Borrower
promptly after the Affected Bank has determined that it is entitled to
compensation, the Borrower may: (i) request one or more of the other Banks to
acquire and assume all or part of such Affected Bank’s Loans and Revolving
Credit Commitment; or (ii) designate a replacement bank or financial institution
satisfactory to the Administrative Agent in its reasonable discretion. If one or
more of the other Banks in its sole discretion agrees to acquire all or part of
such Affected Bank’s Loans and Revolving Credit Commitment or if such a
satisfactory replacement bank or financial institution is designated, the
Affected Bank shall promptly assign all or such part of its Loans and Revolving
Credit Commitment.

     

         2.13. Payments and Prepayments of the
Loans.

     

         (a) The Borrower hereby absolutely and
unconditionally promises to pay the entire principal amount of the Loans, and
the entire principal amount of the Loans shall be absolutely due and payable by
the Borrower to the Banks, on the Revolving Credit Maturity Date. All of the
other Indebtedness evidenced by the Loan Documents shall, if not sooner paid,
also be absolutely due and payable by the Borrower to the Banks on the Revolving
Credit Maturity Date.

     

         (b) The Borrower authorizes the
Administrative Agent to charge to any deposit account which the Borrower may
maintain with the Administrative Agent the principal, interest, fees, charges,
and expenses provided for in this Agreement or any other document executed and
delivered in connection herewith, or to advance to the Borrower and to charge to
it as a Revolving Credit Loan a sum sufficient to pay such principal, interest,
fees, charges, expenses or additional amounts, with advice thereafter sent to
the Borrower’s chief financial officer in accordance with the Administrative
Agent’s customary practice.

     

         (c) Revolving Credit Loans that are
Prime Rate Loans (other than Swingline Loans) may be voluntarily prepaid at any
time, without premium or penalty, with same day written notice to the
Administrative Agent and each Bank, provided such notice
is received by 1:00 p.m. Swingline Loans may be prepaid at any time with same
day written notice to the Swingline Lender, provided such notice is received
by 3:00 p.m. Subject to the provisions of Section 2.16, Revolving Credit Loans
that are LIBOR Loans may be voluntarily prepaid at any time, without premium or
penalty, upon three (3) Business Days’ prior written notice to the
Administrative Agent, provided such notice is received by 1:00 p.m. Any
interest accrued on the amounts so prepaid to the date of such payment must be
paid at the time of any such payment. No prepayment of the Revolving Credit
Loans prior to the Revolving Credit Maturity Date shall affect the Total
Commitment or impair the Borrower’s right to borrow as set forth in Section 2.l.
Partial prepayments of the Revolving Credit Loans shall be in an amount equal to
$500,000 or an integral multiple thereof. In the case of any partial payment of
the Revolving Credit Loans, the total amount of such partial payment shall be
allocable among the Revolving Credit Loans pro rata in accordance with the
Revolving Credit Commitment Percentage of each Bank having a Revolving Credit
Commitment.

     

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2.14. Method of Payment; Withholding Tax
Exemption.

     

         (a) All payments and prepayments of
principal and all payments of interest and other amounts due in respect of Loans
that are not Swingline Loans shall be made by the Borrower to the Administrative
Agent, for the respective accounts of the Banks or (as the case may be) the
Administrative Agent, at 100 Federal Street, Boston, Massachusetts 02110, in
immediately available funds, on or before 1:00 p.m. on the due date thereof,
free and clear of, and without any deduction or withholding for, any taxes
(other than Income Taxes) (all such taxes (other than Income Taxes) imposed by
withholding or deduction, “Covered Taxes”) or other payments unless required by
law, and without set-off, recoupment or counterclaim. If Covered Taxes are
required to be withheld or deducted by law, the Borrower shall pay additional
amounts so that after the required withholding or deduction the Banks and the
Administrative Agent receive the amount they would have received had no such
deduction or withholding been required; provided, however, that the Borrower shall not be
required to pay any additional amounts with respect to (i) Income Taxes, or (ii)
amounts owing to a Bank that (x) is not incorporated under the laws of the
United Sates of America or a state thereof, and (y) has not delivered to the
Administrative Agent the forms required by Section 2.14(b) below (other than
pursuant to the proviso at the end of such Section 2.14(b)).

     

         (b) At least five (5) Business Days
prior to the first date on which interest or fees are payable hereunder for the
account of any Bank, each Bank that is not incorporated under the laws of the
United States of America or a state thereof (herein, a “Foreign Bank”) agrees
that it will deliver to each of the Borrower and the Administrative Agent (or,
in the case of a Participant or an Assignee, to the Bank from which the
Revolving Credit Commitment was transferred) two duly completed and executed
copies of either U.S. Internal Revenue Service Form W-8BEN (relating to an
exemption under an applicable treaty) or Form W-8ECI (or any subsequent versions
thereof or successors thereof), certifying in either case that such Foreign Bank
is entitled to receive payments under this Agreement and the other Loan
Documents without deduction or withholding of any United States federal income
taxes. Each Foreign Bank which so delivers a Form W-8BEN (relating to an
exemption under an applicable treaty) or Form W-8ECI further undertakes to
deliver to each of the Borrower and the Administrative Agent two additional
copies of such form (or a successor form) on or before the date that such form
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent form so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by the Borrower
or the Administrative Agent, in each case certifying that such Foreign Bank is
entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes; provided, however,
that such requirement will not apply to a Foreign Bank if any Change in Law has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Foreign Bank from duly completing and delivering any such form with respect to
it and such Foreign Bank advises the Borrower and the Administrative Agent in
writing that it is no longer capable of receiving payments without any deduction
or withholding of United States federal income taxes.

     

    29

     

    

    
    


         (c) If the Borrower is obligated to
pay additional amounts pursuant to Section 2.14(a), then the relevant Bank shall
timely file the appropriate forms to reduce the amount of required withholding
or deduction to the lowest applicable rate to which such Bank is
entitled.

     

         (d) For any period with respect to which
a Bank has failed to provide the Borrower with the appropriate form described in
(i) Section 2.14(b) above (other than pursuant to the proviso thereto) or (ii)
the proviso to Section 2.14(c) above, such Bank shall not be entitled to any
additional payments under Section 2.11 or this Section 2.14 with respect to
Covered Taxes imposed by reason of such failure; provided, however, that in the event of a failure
described in the proviso to Section 2.14(c), such Bank shall be entitled to such
an additional payment to the extent of the amount of Covered Taxes to which such
Bank would be subject even if it delivered the appropriate form required by the
proviso to Section 2.14(c); and provided, further, however, that should a Bank become subject to
Covered Taxes because of its failure to deliver a form required hereunder, the
Borrower shall take such steps as the Bank reasonably shall request to assist
the Bank to recover such Covered Taxes.

     

         (e) If a Bank or the Administrative Agent
receives a refund or credit in respect of any Covered Taxes as to which it has
been indemnified by the Borrower or with respect to which the Borrower has paid
additional amounts pursuant to Section 2.11 or this Section 2.14, it shall,
reasonably promptly after the date of such receipt, pay over the amount of such
refund or credit to the Borrower, net of all reasonable out-of-pocket expenses
of such Bank or the Administrative Agent in obtaining such refund (it being
agreed that if such expenses are expected by such Bank or the Administrative
Agent to be material, such Bank or the Administrative Agent will attempt in good
faith to consult with the Borrower prior to incurring such expenses) and without
interest (other than interest paid by the relevant taxation authority with
respect to such refund); provided that the Borrower, upon the written
request of such Bank or the Administrative Agent, agrees to repay the amount
paid over to the Borrower (plus penalties, interest or other reasonable charges)
to such Bank or the Administrative Agent in the event such Bank or the
Administrative Agent is required to repay such refund or credit to such taxation
authority.

     

    30

     

    

    
    


         (f) If the Borrower is required to pay
additional amounts to any Bank or the Administrative Agent pursuant to this
Section 2.14, then such Bank shall designate a different lending office with
respect to its LIBOR Loans if such designation would avoid such additional
payment and would not, in the judgment of such Bank, be illegal or otherwise
disadvantageous to the Bank.

     

    31

     

    

    
    


         2.15. Default Rate Interest,
Etc.

     

         (a) At the discretion of the
Majority Banks, after and during the continuance of any Event of Default arising
under Section 7.1(a) or from the Borrower’s breach of Section 6.6 or 6.7, all
amounts outstanding hereunder or under any other Loan Document (including,
without limitation, all principal, interest and fees outstanding) shall bear
interest from and including the due date thereof until paid, compounded daily
and payable on demand, at a rate per annum equal to (i) if such due date occurs
prior to the end of an Interest Period, 2.0% above the interest rate applicable
to such Loan for such Interest Period until the expiration of such Interest
Period, and thereafter, 2.0% above the rate then applicable to Prime Rate Loans;
and (ii) in all other cases, 2.0% above the rate then applicable to Prime Rate
Loans.

     

         (b) After and during the continuance of
any Event of Default arising under Section 7.1(a) or from the Borrower’s breach
of Section 6.6 or 6.7, the Letter of Credit fees payable under Section 2.19 for
standby Letters of Credit shall be increased to a rate per annum equal to 2.0%
above the rate applicable thereto prior to the occurrence thereof.

     

         2.16. Payments Not at End of Interest
Period. If the
Borrower for any reason makes any payment of principal with respect to any LIBOR
Loan on any day other than the last day of an Interest Period applicable to such
LIBOR Loan, or fails to borrow or continue or convert to a LIBOR Loan after
giving a Notice of Borrowing or Conversion pursuant to Section 2.4, the Borrower
shall pay to the Administrative Agent for the respective accounts of the Banks
an amount computed pursuant to the following formula:

     

    
      	L	 = 	(R - T) x P x
      D
	
            	
            	360


    


    
      	     	L	 = 	 	amount
      payable to the Administrative Agent for the accounts of the
  Banks
	
            	R	 = 	
            	Adjusted
      LIBOR Rate on such Loan
	
            	T	 = 	
            	yield to maturity of any readily
      marketable bond or other obligation of the United States, selected at the
      Administrative Agent’s sole discretion, maturing on or near the last day
      of the then applicable Interest Period of such Loan and in approximately
      the same amount as such Loan
	
            	P	 = 	
            	the amount
      of principal prepaid or the amount of the requested Loan
	
            	D	 = 	
            	the number
      of days remaining in the Interest Period as of the date of such payment or
      the number of days of the requested Interest
Period


    

     

    The Borrower shall
pay such amount upon presentation by the Administrative Agent of a statement
setting forth the amount and the Administrative Agent’s calculation thereof (in
reasonable detail) pursuant hereto, which statement shall be deemed prima facie
evidence of the amount owed.

     

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           2.17. Computation of Interest and Fees; Maximum
Interest. Interest
and all fees payable hereunder on account of Prime Rate Loans and Swingline
Loans (including all Commitment Fees and all other fees (except as set forth in
the next sentence)) shall be computed daily on the basis of a year of 365/366
days and paid for the actual number of days for which due. Interest and all fees
payable hereunder on account of LIBOR Loans, and Utilization Fees payable with
reference to LIBOR Loans, shall be computed daily on the basis of 360 days and
paid for the actual number of days for which due. If the due date for any
payment of principal is extended by operation of law, interest shall be payable
for such extended time. If any payment required by this Agreement becomes due on
a day that is not a Business Day such payment may be made on the next succeeding
Business Day (subject to clause (i) of the definition of Interest Period), and
such extension shall be included in computing interest in connection with such
payment. Notwithstanding any other term of this Agreement, the other Loan
Documents or any other document referred to herein therein, the maximum amount
of interest which may be charged to or collected from any person liable
hereunder or under any other Loan Documents by any Bank shall be absolutely
limited to, and shall in no event exceed, the maximum amount of interest which
could lawfully be charged or collected under applicable law (including, to the
extent applicable, the provisions of Section 5197 of the Revised Statutes of the
United States of America, as amended, 12 U.S.C. Section 85, as amended), so that
the maximum of all amounts constituting interest under applicable law, howsoever
computed, shall never exceed as to any Person liable therefor such lawful
maximum, and any term of this Agreement, the Letter of Credit applications, the
other Loan Documents or any other document referred to herein or therein which
could be construed as providing for interest in excess of such lawful maximum
shall be and hereby is made expressly subject to and modified by the provisions
of this paragraph.

       

    

         2.18. Letters of Credit.

     

         (a) On the application of the Borrower,
each Issuing Bank agrees to issue Letters of Credit from time to time for the
account of the Borrower, provided, however, that each such issuance shall be
subject to the following conditions: (i) it shall be subject to the other terms
and conditions of this Agreement; (ii) it shall be issued in reliance upon the
representations, warranties and covenants of the Borrower made in this
Agreement; (iii) it shall be issued only to the extent permitted by law; (iv) it
will be subject to the Uniform Customs and Practices for Documentary Credits of
the International Chamber of Commerce governing Letters of Credit (Publication
No. 500 or any successor thereto) (“UCP 500”); (v) it shall be issued during the
period from the Closing Date until the date that is 30 days prior to the
Revolving Credit Maturity Date, (vi) it will be subject to the L/C Sublimit and
shall not otherwise result in an Excess Issuance, and (vii) no Default or Event
of Default shall exist at the time the Borrower requests the issuance of such
Letter of Credit or would exist after giving effect to the issuance thereof. It
is understood and agreed by the parties hereto that amounts drawn under such
Letters of Credit shall become immediately due and payable by the Borrower to
the applicable Issuing Bank and, if not then paid, shall bear interest at the
rate then applicable to Revolving Credit Loans that are Prime Rate Loans, and,
if not paid forthwith, shall be added to the Loan Account as Revolving Credit
Loans and shall be immediately due and payable upon the Revolving Credit
Maturity Date (or, if earlier, upon acceleration of the Loans).

     

    33

     

    

    
    


         (b) Each Issuing Bank agrees that
upon receipt of an application by the Borrower for a Letter of Credit, prior to
issuing the requested Letter of Credit, such Issuing Bank shall notify the
Administrative Agent by telephone (with written confirmation) of such
application to determine that the issuance thereof will not result in an Excess
Issuance (and the Administrative Agent agrees to make reasonable efforts to
reply as promptly as is practicable to such telephonic notification). After
issuance of any Letters of Credit, each Issuing Bank shall provide weekly
updates to the Administrative Agent with respect to the aggregate amount of all
unreimbursed draws thereunder and such other information as the Administrative
Agent may reasonably request. Additionally, the Borrower, each Issuing Bank and the Administrative Agent
agree to negotiate in good faith after the date of this Agreement to establish
additional written procedures with respect to the issuance of Letters of Credit
to reduce the risk that Letters of Credit will be issued which would result in
an Excess Issuance. Notwithstanding the foregoing, the Borrower acknowledges
that it is the unconditional obligation of the Borrower to ensure that at no
time shall an Excess Issuance occur.

     

         (c) Upon the Administrative Agent’s
receipt of notification of each Letter of Credit application from the applicable
Issuing Bank, the Administrative Agent shall notify each Bank of its pro rata
participation in the Letter of Credit to be issued. Upon the issuance of each
Letter of Credit by an Issuing Bank in accordance with this section, each Bank
having a Revolving Credit Commitment shall be deemed to automatically have
purchased a participation in such Letter of Credit in accordance with its
Revolving Credit Commitment Percentage of the Revolving Credit Commitment and
each Bank severally agrees that it shall be absolutely liable, without regard to
the occurrence of any Default or Event of Default or any other condition
precedent whatsoever, to the extent of such Bank’s Revolving Credit Commitment
Percentage thereof, to reimburse the Issuing Bank on demand for the amount of
each draft paid by such Issuing Bank under each Letter of Credit to the extent
that such amount is not reimbursed by the Borrower pursuant hereto or added to
the Loan Account as Revolving Credit Loans. In addition, all Letters of Credit
shall, unless the Issuing Bank and the Banks otherwise agree in writing, have a
stated expiration date not to exceed one year from date of issuance. The stated
expiration date of a Letter of Credit may be after the Revolving Credit Maturity
Date, provided, however, that for any Letter of Credit
outstanding 5 days prior to the Revolving Credit Maturity Date, the Borrower
must, on such date, provide to the Administrative Agent cash collateral in an
amount equal to 105% of the aggregate Stated Amount of Letters of Credit
outstanding on such date, and provided further that, on the Revolving Credit Maturity
Date all unreimbursed draws under all Letters of Credit outstanding on the
Revolving Credit Maturity Date shall be immediately due and
payable.

     

         (d) In order to evidence such Letters of
Credit, the Borrower shall enter into, with the applicable Issuing Bank, such
agreements and execute such customary instruments and documents as such Issuing
Bank reasonably requires, including, but not limited to, a letter of credit
application and agreement. In the event that any provision of any Letter of
Credit application shall be inconsistent with any provision of this Agreement,
then the provisions of this Agreement shall, to the extent of any such
inconsistency, govern.

     

    34

     

    

    
    


         (e) In addition to amounts payable as
elsewhere provided in Section 2.19, the Borrower hereby agrees to protect,
indemnify, pay and save harmless the Administrative Agent, each Issuing Bank and
each Bank from and against any and all liabilities and costs which the
Administrative Agent, such Issuing Bank or such Bank may incur or be subject to
as a consequence, direct or indirect, of (i) the issuance of any Letter of
Credit other than as a result of the gross negligence or willful misconduct of
the Issuing Bank, or (ii) the failure of the applicable Issuing Bank to honor a
drawing under a Letter of Credit as a result of any act or omission, whether
rightful or wrongful, of any present or future de jure or de facto governmental authority (all such acts or
omissions herein called “Governmental Acts”).

     

         (f) As among the Borrower, the
Banks, the Administrative Agent and the Issuing Banks, the Borrower assumes all
risks of the acts and omissions of, or misuse of such Letters of Credit by, the
beneficiary of any Letter of Credit. In furtherance and not in limitation of the
foregoing, subject to the provisions of the Letter of Credit applications and
Letter of Credit reimbursement agreements executed by the Borrower at the time
of request for any Letter of Credit and the applicable provisions of UCP 500,
neither the Administrative Agent, any Issuing Bank nor any Bank shall be
responsible (in the absence of gross negligence or willful misconduct in
connection therewith): (i) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in connection
with the application for and issuance of any Letter of Credit that appears on
its face to comply in all material respects with the requirements of the Letter
of Credit, even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) for the validity or
sufficiency of any instrument that appears on its face to comply in all material
respects with the requirements of the Letter of Credit transferring or assigning
or purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason; (iii) for failure of the beneficiary of a
Letter of Credit to comply duly with conditions required in order to draw upon
such Letter of Credit; (iv) for errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, electronic mail, cable,
telegraph, telex, or other similar form of teletransmission or otherwise; (v)
for errors in interpretation of technical trade terms; (vi) for any loss or
delay in the transmission or otherwise of any document required in order to make
a drawing under any Letter of Credit or of the proceeds thereof; (vii) for the
misapplication by the beneficiary of a Letter of Credit of the proceeds of any
drawing under such Letter of Credit; and (viii) for any consequences arising
from causes beyond the control of the Administrative Agent, the Issuing Banks
and the Banks, including, without limitation, any acts of any governmental
authorities. None of the above shall affect, impair, or prevent the vesting of
any Issuing Bank’s rights or powers under this Section 2.18.

     

         (g) In furtherance and extension and
not in limitation of the specific provisions hereinabove set forth, any action
taken or omitted by any Issuing Bank under or in connection with the Letters of
Credit or any related certificates shall not, in the absence of gross negligence
or willful misconduct, put the applicable Issuing Bank, the Administrative Agent
or any Bank under any resulting liability to the Borrower or relieve the
Borrower of any of its obligations hereunder to any such Person.

     

    35

     

    

    
    


         (h) Without prejudice to the
survival of any other Loan Document, the agreements and obligations of the
Borrower contained in this Section 2.18 shall survive the payment in full of
principal and interest hereunder, the termination of the Letters of Credit and
the termination of this Agreement.

     

         (i) Prior to the Closing Date, two
Letters of Credit having an aggregate balance outstanding on the Closing Date
that is set forth on Schedule 2 were issued by the Issuing Bank for the
account of the Borrower (the “Carryover Letters of Credit”). The parties agree
that, on the Closing Date, the Carryover Letters of Credit shall be deemed to
have been issued pursuant to this Agreement as outstanding Letters of
Credit.

     

         2.19. Letter of Credit Fees.

     

         (a) A per annum Letter of Credit fee
shall be payable quarterly in arrears on the last day of March, June, September
and December to the applicable Issuing Bank, for the ratable accounts of the
Banks, on each standby Letter of Credit at a rate per annum equal to the
applicable percentage set forth in Section 2.19(c) below determined for each
standby Letter of Credit in effect during any portion of such quarter multiplied
by the average daily amount available for drawing under each such Letter of
Credit during such quarter, along with, solely for the account of the Issuing
Bank, such documentary issuance, amendment, processing and other fees as are
customarily charged by the Issuing Bank on standby Letters of
Credit.

     

         (b) A per annum Letter of Credit fee
shall be payable quarterly in arrears on the last day of March, June, September
and December to the applicable Issuing Bank, for the ratable accounts of the
Banks, on each documentary Letter of Credit at a rate per annum equal to the
applicable percentage set forth in Section 2.19(c) below determined for each
documentary Letter of Credit in effect during any portion of such quarter
multiplied by the average daily amount available for drawing under each such
Letter of Credit during such quarter, along with, solely for the account of the
Issuing Bank, such documentary issuance, amendment, processing and other fees as
are customarily charged by the Issuing Bank on documentary Letters of
Credit.

     

         (c) The rate per annum for Letter of
Credit fees shall be equal to (A) from the Closing Date through the six month
period following the Closing Date, the rate set forth in Level III below, and
thereafter (B) the percentage determined for each Rate Period by reference
to Table 2 below based on the higher (by Level
number) of the following two Levels: (i) the Level applicable to the Borrower
under the column “Rating” or (ii) the Level applicable to the Borrower under the
heading “Adjusted Interest Coverage Ratio”:

     

    36

     

    

    
    


    Table 2

     

    
      	 	 	 	 	 	 	Standby	 	Documentary
	Level	     	Rating	     	Adjusted Interest Coverage
      Ratio	     	Letter of Credit Fee	
            	Letter of Credit Fee
	I)	
            	<BBB-	
            	less than 2.5 to 1	
            	1.125%	     	0.250%
	II)	 	BBB-	 	greater than or equal to 2.50 to 1	
            	
            	 	
            
	
            	 	
            	 	but less than 3.0 to 1	 	0.875%	 	0.250%
	III)	 	BBB	 	greater than or equal to 3.0 to 1
      but	
            	 	
            	
            
	
            	
            	
            	 	less than 4.0 to 1	
            	0.750%	 	0.250%
	IV)	
            	BBB+	
            	greater than or equal to 4.0 to 1	 	
            	 	 
	
            	
            	
            	
            	but less than 5.0 to 1	
            	0.625%	
            	0.250%
	V)	
            	greater than	
            	
            	 	
            	
            	
            
	
            	
            	or equal to A-	
            	greater than or equal to 5.0 to
      1	
            	0.500%	
            	0.250%


    


    For purposes of
determining the applicable Letter of Credit fee, the Adjusted Interest Coverage
Ratio will be tested quarterly and calculated on a rolling four-quarter basis,
based on the financial statements and compliance certificate required to be
delivered pursuant to Sections 5.1(a), 5.1(b) and 5.1(c), respectively. The
Letter of Credit fees for each Letter of Credit shall be payable quarterly in
arrears on the last day of March, June, September and December. Each Issuing
Bank shall, at least three (3) Business Days prior to the last day of March,
June, September and December, provide to the Borrower (with a copy to the
Administrative Agent) an estimated invoice reflecting the estimated amount of
the Letter of Credit fees due for such quarter, which estimate shall be updated
by such Issuing Bank on the last day of such quarter.

     

         (d) With respect to all fees payable
by the Borrower to the Issuing Banks for the ratable accounts of the Banks
pursuant to this Section 2.19, each Issuing Bank shall, promptly after its
receipt of such fees, distribute to each Bank its ratable share of such fees and
an accounting thereof, and shall send the Administrative Agent a copy of such
accounting. Prior to making each such distribution, each such Issuing Bank will
request from the Administrative Agent, and the Administrative Agent shall
provide promptly, a copy of the then-effective Schedule 1 to this
Agreement.

     

         2.20. Interdependence of Borrower Affiliated
Group. In order to
induce each of the Banks to enter into this Agreement and the other Loan
Documents to which it is a party, and grant the Loans hereunder and issue the
Letters of Credit, the Borrower, on behalf of itself and each other member of
the Borrower Affiliated Group, hereby represents and warrants that:

     

         (i) the Borrower and the other
members of the Borrower Affiliated Group are members of a group of related
business entities, the success of any one of which is dependent in part on the
success of the other members of such group;

     

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         (ii) each member of the Borrower
Affiliated Group has cooperated to the extent necessary and shall continue to
cooperate with each other member of the Borrower Affiliated Group to the extent
necessary in the development and conduct of each other member of the Borrower
Affiliated Group’s business, and shall, to the extent consistent with prior
practices, and as adjusted to take into account new business methods and
technologies, share and participate in the formulation of methods of operation,
distribution, leasing, inventory control, and other similar business matters
essential to each member of the Borrower Affiliated Group's business;
and

     

         (iii) each member of the Borrower
Affiliated Group will receive substantial direct benefits from the making of
Loans and extensions of credit to the Borrower by the Banks and the
Administrative Agent.

     

    SECTION III

     

    CONDITIONS OF LOANS

     

         3.1. Conditions Precedent to Effectiveness of
Agreement. The
effectiveness of this Agreement is subject to the fulfillment on the Closing
Date of each of the following conditions precedent:

     

         3.1.1. Loan Documents, Etc. Each of the Loan Documents shall have
been duly and properly authorized, executed and delivered by the respective
parties thereto and shall be in full force and effect on and as of the Closing
Date.

     

         3.1.2. Legality of
Transactions. No
change in applicable law or regulation shall have occurred as a consequence of
which it shall have become and continue to be unlawful (i) for the
Administrative Agent or any of the Banks to perform any of their agreements or
obligations under any of the Loan Documents to which they are a party on the
Closing Date, or (ii) for the Borrower, or any other member of the Borrower
Affiliated Group to perform any of its agreements or obligations under any of
the Loan Documents to which it is a party on the Closing Date.

     

         3.1.3. Representations and
Warranties. Each of
the representations and warranties made by any member of the Borrower Affiliated
Group in this Agreement or the other Loan Documents to the Administrative Agent
and the Banks shall be true and correct when made, shall, for all purposes of
this Agreement, be deemed to be repeated on and as of the Closing Date, and
shall be true and correct on and as of such date (except to the extent that such
representations and warranties expressly relate to an earlier
date).

     

         3.1.4. Performance, Consents, No Defaults,
Litigation, Etc. The
Borrower and each other member of the Borrower Affiliated Group shall have duly
and properly performed, complied with and observed each of its covenants,
agreements and obligations contained in any of the Loan Documents to which it is
a party or by which it is bound which are required to be performed on the
Closing Date. Any necessary consents and/or waivers in connection with the
consummation of the transactions contemplated by the Loan Documents shall have
been obtained by the Borrower and the other members of the Borrower Affiliated
Group and copies thereof shall have been delivered to the Administrative Agent
and the Banks. No event shall have occurred on or prior to the Closing Date and
be continuing on the Closing Date, and no condition shall exist on the Closing
Date, which constitutes a Default or an Event of Default. No litigation or other
proceeding, tax matter, ERISA matter or Environmental Claim shall be continuing,
or pending or threatened in writing, which individually or in the aggregate
could reasonably be expected to have a Material Adverse Effect.

     

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         3.1.5. Certified Copies of Charter
Documents. The
Administrative Agent shall have received from the Borrower and each Significant
Subsidiary a copy, certified by a duly authorized officer of each of the
Borrower and such Significant Subsidiary to be true and complete on the Closing
Date, of (i) its charter or other formation documents, as in effect on such date
of certification, certified (where applicable) as of a recent date by the
Secretary of State of its jurisdiction of incorporation, and (ii) where
applicable, its by-laws or limited liability company agreement as in effect on
such date.

     

         3.1.6. Proof of Entity Action. The Administrative Agent shall have
received from the Borrower and each Significant Subsidiary a copy, certified by
a duly authorized officer of each of the Borrower and such Significant
Subsidiary to be true and complete on the Closing Date, of records of all
resolutions and other action taken by each of the Borrower and such Significant
Subsidiary to authorize, as applicable (i) its execution and delivery of the
Loan Documents to which it is or is to become a party, (ii) its performance of
all of its agreements and obligation under each of such documents, and (iii) any
borrowings and other transactions contemplated by this Agreement.

     

         3.1.7. Incumbency Certificate. The Administrative Agent shall have
received from the Borrower and each Significant Subsidiary an incumbency
certificate, dated the Closing Date and signed by the duly authorized officers
of each of the Borrower and such Significant Subsidiary, and giving the name and
bearing a specimen signature of each individual who shall be authorized, as
applicable: (i) to sign, in the name and on behalf of each of the Borrower and
such Significant Subsidiary, the Loan Documents to which it is or is to become a
party; (ii) to make application for the Loans or conversion thereof; and (iii)
to give notices to take other action on its behalf under the Loan
Documents.

     

         3.1.8. Proceedings and
Documents. All
corporate, company, governmental and other proceedings in connection with the
transactions contemplated by the Loan Documents, and all instruments and
documents incidental thereto, shall be in form and substance reasonably
satisfactory to the Administrative Agent, and the Administrative Agent shall
have received all such counterpart originals or certified or other copies of all
such instruments and documents as the Administrative Agent shall have reasonably
requested.

     

         3.1.9. Good Standing, Etc. The Administrative Agent shall have
received a long-form certificate of the Secretary of State of the respective
jurisdiction(s) of formation of each of the Borrower and each Significant
Subsidiary as to each of the Borrower’s and such Significant Subsidiary’s legal
existence and good standing in such states and listing all documents on file in
the office of said Secretary of State. The Administrative Agent shall also have
received certificates of qualification to do business for the Borrower from the
following jurisdictions (to the extent not covered by the preceding sentence):
Delaware, California, Pennsylvania, New York and South Carolina.

     

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         3.1.10. Fees. The Borrower shall have complied with
its obligations under Section 2.6 to pay the fees described in the Fee Letter,
and, if any, the Letter of Credit fees described in Section 2.19, and all legal
fees and expenses and other fees and expenses incurred by the Administrative
Agent in connection with the consummation of the transactions contemplated by
this Agreement.

     

         3.1.11. Legal Opinions. The Administrative Agent shall have
received a written legal opinion, addressed to the Administrative Agent and the
Banks, dated the Closing Date, from Latham & Watkins LLP, counsel to the
Borrower Affiliated Group, substantially in the form of Exhibit D hereto.

     

         3.1.12. Due Diligence; Financial
Condition. The
Administrative Agent and each of the Banks shall have completed their due
diligence. The Administrative Agent and the Banks shall be satisfied that there
has been no material misrepresentation or omission in any disclosure material
provided to the Administrative Agent and that no Material Adverse Effect has
occurred since the most recent financial statements referred to in Section
4.7.

     

         3.1.13. U.C.C. Search Reports;
Insurance. The
Administrative Agent shall have received a certificate of the chief financial
officer of the Borrower certifying that no Encumbrances exist other than
Permitted Encumbrances and, as a condition subsequent to the Closing, the
Administrative Agent shall have received within ten (10) days of the Closing
reports concerning the results of searches of the Uniform Commercial Code filing
offices for the Borrower and each Significant Subsidiary in each jurisdiction
where assets of such Person are located made as of a recent date prior to the
Closing Date, the results of which reports shall be satisfactory to the
Administrative Agent and the Banks in their discretion. The Administrative Agent
shall have received satisfactory evidence that liability insurance and casualty
insurance of the Borrower and each Significant Subsidiary is in
effect.

     

         3.1.14. Syndication. The Arranger shall have syndicated the
Revolving Credit Commitments in a manner mutually satisfactory to the Borrower
and the Administrative Agent.

     

         3.2. Conditions Precedent to Initial Funding
Date, and all Loans and Letters of Credit. The obligation of each Bank to make
each Loan, including the initial Loans, or continue or convert Loans to Loans of
the other type, and of each Issuing Bank to issue each Letter of Credit, is
further subject to the following conditions:

     

         (a) neither the Borrower nor any
other member of the Borrower Affiliated Group shall have any outstanding
Indebtedness, other than as permitted by Section 6.1;

     

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         (b) timely receipt by the
Administrative Agent and the Banks of the Notice of Borrowing or Conversion as
provided in Section 2.4;

     

         (c) the representations and
warranties contained in Section IV shall be true and accurate in all material
respects on and as of the date of such Notice of Borrowing or Conversion and on
the effective date of the making, continuation or conversion of each Loan as
though made at and as of each such date (except to the extent that such
representations and warranties expressly relate to an earlier
date);

     

         (d) with respect to the making of new
Loans and issuance of new Letters of Credit, no Default or Event of Default
shall have occurred and be continuing, or would result from such Loan or Letter
of Credit, and with respect to the continuation of a LIBOR Loan or conversion of
a Loan of the other type into a LIBOR Loan, no Event of Default shall have
occurred and be continuing or would result from such continuation or
conversion;

     

         (e) the resolutions referred to in
Section 3.1.6 shall remain in full force and effect; and

     

         (f) no change shall have occurred in
any law or regulation or interpretation thereof that, in the opinion of counsel
for the Administrative Agent or any Bank, would make it illegal or against the
policy of any governmental agency or authority for such Bank to make Loans
hereunder.

     

         The making of each Loan shall be
deemed to be a representation and warranty by the Borrower on the date of the
making, continuation or conversion of such Loan as to the accuracy of the facts
referred to in subsection (b) of this Section 3.2.

     

    SECTION IV

     

    REPRESENTATIONS AND
WARRANTIES

     

         In order to induce the
Administrative Agent and the Banks to enter into this Agreement and to make
Loans and issue Letters of Credit hereunder, the Borrower on behalf of itself
and each other member of the Borrower Affiliated Group, represents and warrants
to the Administrative Agent and each Bank that:

     

         4.1. Organization and
Qualification. The
Borrower and each other member of the Borrower Affiliated Group (a) is an entity
duly incorporated, organized or formed, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or other formation as
indicated on Exhibit C hereto, (b) has all requisite corporate, partnership,
limited liability company or other power to own its property and conduct its
business as now conducted and as presently contemplated, and (c) is duly
qualified and in good standing as a foreign corporation, foreign limited
liability company, foreign limited partnership or other entity and is duly
authorized to do business in each jurisdiction where the nature of its properties or business requires such
qualification, except where the failure to be so qualified would not reasonably
be expected to have a Material Adverse Effect. 

     

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         4.2.
Entity Authority. The execution, delivery and performance
of each of the Loan Documents to which the Borrower or any other member of the
Borrower Affiliated Group is or is to become a party and the transactions
contemplated hereby and thereby are within the power and authority of the
Borrower or such member of the Borrower Affiliated Group and have been
authorized by all necessary proceedings, and do not and will not (a) require any
consent or approval of any creditors, trustees for creditors, shareholders or
members of the Borrower or such member of the Borrower Affiliated Group (other
than any such consent that has been obtained prior to the Closing Date and
delivered to the Administrative Agent), (b) contravene any provision of the
charter documents or other organizational documents of the Borrower or such
member of the Borrower Affiliated Group or any law, rule or regulation
applicable to the Borrower or such member of the Borrower Affiliated Group, (c)
contravene any provision of, or constitute an event of default or event that,
but for the requirement that time elapse or notice be given, or both, would
constitute an event of default under, any other agreement, instrument, order or
undertaking binding on the Borrower or such member of the Borrower Affiliated
Group, or (d) result in or require the imposition of any Encumbrance on any of
the properties, assets or rights of the Borrower or such member of the Borrower
Affiliated Group. 

     

         4.3.
Valid Obligations. Each of the Loan Documents to which the
Borrower or any other member of the Borrower Affiliated Group is or is to become
a party and all of their respective terms and provisions are the legal, valid
and binding obligations of the Borrower or such member of the Borrower
Affiliated Group enforceable in accordance with their respective terms, except
as limited by bankruptcy, insolvency, reorganization, moratorium or other laws
affecting the enforcement of creditors’ rights generally, and except as the
remedy of specific performance or of injunctive relief is subject to the
discretion of the court before which any proceeding therefor may be brought.


     

         4.4.
Consents or Approvals. The execution, delivery and performance
of each of the Loan Documents to which the Borrower or any other member of the
Borrower Affiliated Group is or is to become a party and the transactions
contemplated herein and therein do not require any approval or consent of, or
filing or registration with, any governmental or other agency or authority, or
any other party. 

     

         4.5.
Title to Properties; Absence of
Encumbrances. Each of
the Borrower and each other member of the Borrower Affiliated Group has good and
marketable title to all of the properties, assets and rights of every name and
nature now purported to be owned by it, including, without limitation, such
properties, assets and rights as are reflected in the Initial Financial
Statement (except such properties, assets or rights as have been disposed of in
the ordinary course of business since the date thereof), free from all
Encumbrances except Permitted Encumbrances, and, except as so disclosed, free
from all defects of title as would, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect. The rights, properties and other
assets presently owned, leased or
licensed by the Borrower and each other member of the Borrower Affiliated Group
include all rights, properties and other assets necessary to permit the Borrower
and such member of the Borrower Affiliated Group to conduct its businesses in
all material respects in the same manner as its businesses have been conducted
prior to the date hereof.

     

    42

     

    

    
    



         4.6. Franchises, Patents, Copyrights,
Etc. Except as
otherwise set forth on Exhibit C hereto, the Borrower and each other
member of the Borrower Affiliated Group possesses, licenses or otherwise has
rights in or to all franchises, patents, copyrights, trademarks, tradenames,
service marks, licenses and permits material to the conduct of its business as
substantially now conducted without known conflict with any rights of others
and, in each case, free of any Encumbrance that is not a Permitted Encumbrance.


     

         4.7.
Financial Statements. The Borrower has furnished to the
Administrative Agent and the Banks (a) the Consolidated balance sheet of the
Borrower as of February 1, 2003 and the related Consolidated statements of
earnings, stockholders’ equity and cash flows of the Borrower Affiliated Group
for the fiscal year then ended, and related footnotes, audited and certified by
Deloitte & Touche LLP, and (b) the unaudited Consolidated balance sheet of
the Borrower as of November 1, 2003 and the related unaudited Consolidated
statements of earnings, stockholders’ equity and cash flows of the Borrower for
the nine months then ended (the foregoing, collectively, the “Initial Financial
Statement”). All such financial statements were prepared in accordance with GAAP
(except that the unaudited financial statements are without footnotes) and
present fairly the Consolidated financial position of the Borrower as of such
dates and the results of the Consolidated operations of the Borrower for such
periods except, as to the unaudited financial statements, subject to normal,
recurring year-end adjustments. There are no liabilities, contingent or
otherwise, not disclosed in any of such financial statements that involve a
material amount. 

     

         4.8.
Changes. During the period from the date of the
Initial Financial Statement through the date hereof, no Material Adverse Effect
has occurred. 

     

         4.9.
Defaults. As of the date of this Agreement and
immediately prior thereto, no Default or Event of Default exists. 

     

        
4.10. Taxes. The Borrower and each other member of
the Borrower Affiliated Group has filed all material federal, state and other
tax returns required to be filed, and all material taxes, assessments and other
governmental charges due from the Borrower or such other member of the Borrower
Affiliated Group have been fully paid or adequate reserves have been established
therefor. Neither the Borrower nor any other member of the Borrower Affiliated
Group has executed any waiver of limitations in respect of tax liabilities
except as disclosed on the Disclosure Schedule to this Agreement. Each member of
the Borrower Affiliated Group has established on its books reserves adequate for
the payment of all material federal, state and other tax liabilities.


     

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         4.11. Litigation. Except as set forth on Exhibit C hereto, there is no litigation,
arbitration, claim, proceeding or investigation pending or, to the Borrower’s
knowledge, threatened against the Borrower or any other member of the Borrower
Affiliated Group that, if adversely determined, would reasonably be expected to
have a Material Adverse Effect, whether through a judgment not fully covered by
insurance, forfeiture of property, or otherwise. 

     

        
4.12. Subsidiaries. As of the date of this Agreement, the
Borrower has no direct or indirect Significant Subsidiaries except as disclosed
on Exhibit C hereto. 

     

        
4.13. Investment Company Act. Neither the Borrower nor any other
member of the Borrower Affiliated Group is subject to regulation under the
Investment Company Act of l940, as amended. 

     

        
4.14. Compliance with ERISA. The Borrower, each Significant
Subsidiary and each member of the Controlled Group have fulfilled their
obligations under the minimum funding standards of ERISA and the Code with
respect to each Plan and are in compliance in all material respects with the
applicable provisions of ERISA and the Code, and have not incurred any material
liability to the PBGC or a Plan under Title IV of ERISA; and no Prohibited
Transaction or Reportable Event has occurred that would, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.


     

        
4.15. Environmental Matters.
Except as
specifically disclosed in Exhibit C hereto, there are no violations by any
member of the Borrower Affiliated Group of any Environmental Law and no
Environmental Claims that would, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. 

     

        
4.16. Disclosure. No representations and warranties made
by any member of the Borrower Affiliated Group in this Agreement, any other Loan
Document or in any other agreement, instrument, document, certificate, statement
or letter furnished to the Administrative Agent, the Arranger, or the Banks by
or on behalf of any member of the Borrower Affiliated Group in connection
herewith, and no other factual information heretofore or contemporaneously
furnished by or on behalf of any member of the Borrower Affiliated Group to the
Administrative Agent, the Arranger or the Banks, in connection with any of the
transactions contemplated by any of the Loan Documents contains any untrue
statement of material fact or omits to state a material fact necessary in order
to make the statements contained therein not materially misleading in light of
the circumstances in which they are made. Any projections and pro forma
financial information contained in such materials are based upon good faith
estimates and assumptions believed by each member of the Borrower Affiliated
Group to be reasonable at the time made, it being recognized by the
Administrative Agent and the Banks that such projections as to future events are
not to be viewed as facts and that actual results during the period or periods
covered by any such projections may differ from the projected results. Except as
disclosed herein or therein, there is no fact known to any member of the
Borrower Affiliated Group which would reasonably be expected to cause a Material
Adverse Effect. 

     

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         4.17. Solvency. Both before and after giving effect to
all Indebtedness incurred by the Borrower on the Closing Date, neither the
Borrower nor any member of the Borrower Affiliated Group is Insolvent or will be
rendered Insolvent by the Indebtedness incurred in connection
therewith.

     

        
4.18. Compliance with Statutes,
etc. The Borrower and
each other member of the Borrower Affiliated Group is in compliance with all
applicable statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic or foreign, in respect of the
conduct of its business and the ownership of its property, except for such
non-compliances as would not reasonably be expected, in the aggregate, to have a
Material Adverse Effect.

     

        
4.19. Labor Relations. Neither the Borrower nor any other
member of the Borrower Affiliated Group is engaged in any unfair labor practice
in violation of any applicable law or order of any court or governmental
authority. There is (i) no unfair labor practice complaint pending or, to the
Borrower’s knowledge, threatened against the Borrower or any other member of the
Borrower Affiliated Group before the National Labor Relations Board, and no
grievance or arbitration proceeding arising out of or under any collective
bargaining agreement is so pending against the Borrower or any other member of
the Borrower Affiliated Group or, to the knowledge of the Borrower Affiliated
Group, threatened against it, and (ii) no labor dispute, slowdown or stoppage
pending against the Borrower or any other member of the Borrower Affiliated
Group or, to the knowledge of the Borrower Affiliated Group, threatened against
the Borrower or any other member of the Borrower Affiliated Group, that in the
case of clauses (i) and (ii), would reasonably be expected to have a Material
Adverse Effect. To the knowledge of the Borrower, no union representation
question exists with respect to the employees of the Borrower or any other
member of the Borrower Affiliated Group and no union organizing activities are
taking place.

     

        
4.20. Certain Transactions. Except as set forth on Exhibit C hereto, none of the officers, partners,
directors, or employees of any member of the Borrower Affiliated Group is
presently a party to any transaction with any other member of the Borrower
Affiliated Group (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
partner, director or such employee or, to the knowledge of the Borrower
Affiliated Group, any corporation, partnership, trust or other entity in which
any officer, partner, director, or any such employee or natural person related
to such officer, partner, director or employee or other Person in which such
officer, partner, director or employee has a direct or indirect beneficial
interest, has a substantial direct or indirect beneficial interest or is an
officer, director, trustee or partner.

     

        
4.21. Restrictions on the Borrower Affiliated
Group. No member of
the Borrower Affiliated Group is a party to or bound by any contract, agreement
or instrument, or subject to any charter or other corporate restriction, that is
likely to cause a Material Adverse Effect.

     

    45

     

    

    
    



    SECTION V

     

    AFFIRMATIVE COVENANTS

     

         So long as any Bank has any commitment to make Loans or issue Letters of
Credit hereunder or any Loan or other Obligation hereunder remains outstanding,
the Borrower covenants as follows on behalf of itself and each other member of
the Borrower Affiliated Group: 

     

         5.1.
Financial Statements and other Reporting
Requirements. The
Borrower shall furnish to the Administrative Agent and each Bank: 

     

         (a)
as soon as available, but in any event within 90 days after the end of each
fiscal year of the Borrower, a Consolidated balance sheet as of the end of, and
a related Consolidated statement of income, Consolidated statement of
stockholders’ equity and consolidated statement of cash flows for, such year,
prepared in accordance with GAAP and audited and certified without qualification
by Deloitte & Touche LLP or another “Big Five” accounting firm;


     

         (b)
as soon as available, but in any event within 60 days after the end of each
fiscal quarter of the Borrower, (i) a Consolidated balance sheet as of the end
of, and a related Consolidated statement of income, Consolidated statement of
stockholders’ equity and consolidated statement of cash flows for, the fiscal
quarter then ended, prepared in accordance with GAAP (without footnotes) and
certified by the chief financial officer or treasurer of the Borrower, but
subject, however, to normal, recurring year-end adjustments; 

     

         (c) concurrently with the delivery of
each financial statement pursuant to subsections (a) and (b) of this Section
5.l, a report in substantially the form of Exhibit E hereto signed on behalf of the Borrower
by the chief financial officer or treasurer of the Borrower, and including,
without limitation, computations in reasonable detail evidencing compliance for
such fiscal year and quarter with the covenants contained in Sections 6.6 and
6.7 hereof; 

     

         (d) as soon as available, (i) copies of
the Borrower’s filed Securities and Exchange Commission Forms 10-K and 10-Q,
(ii) copies of all financial statements, proxy material, and reports as the
Borrower shall send to its stockholders, (iii) copies of all other filings the
Borrower makes with the Securities and Exchange Commission, and (iv) notice of
any amendment to the charter or by-laws of the Borrower or any other member of
the Borrower Affiliated Group. 

     

         (e) if and when the Borrower or any
Significant Subsidiary gives or is required to give notice to the PBGC of any
Reportable Event that might constitute grounds for a termination of such Plan
under Title IV of ERISA, or knows that any member of the Controlled Group has
given or is required to give notice of any such Reportable Event, a copy of the
notice of such Reportable Event given or required to be given to the PBGC or, if
such notice is not given to the
PBGC, a description of the content of the notice that would be required to be
given; 

     

    46

     

    

    
    



         (f) immediately upon becoming aware of the existence of any condition or
event (i) that constitutes a Default or Event of Default, written notice thereof
specifying the nature and duration thereof and the action being or proposed to
be taken with respect thereto, or (ii) affecting the Borrower or any other
member of the Borrower Affiliated Group which could reasonably be expected to
have a Material Adverse Effect, written notice thereof specifying the nature
thereof and the action being or proposed to be taken with respect thereto; and
(iii) immediately upon receipt thereof, copies of any notice (whether formal or
informal) of any cancellation or termination in any insurance maintained by any
member of the Borrower Affiliated Group; 

     

         (g)
promptly upon becoming aware of any litigation or any investigative proceedings
by any Person, including, without limitation, any governmental agency or
authority, commenced or threatened against the Borrower or any other member of
the Borrower Affiliated Group of which it has notice, or of a material change in
any such existing litigation or proceedings, the outcome of which could
reasonably be expected to have a Material Adverse Effect, notice thereof and a
statement of the nature and status of such litigation or proceedings;


     

         (h)
promptly upon becoming aware of (i) any investigative proceedings by a
governmental agency or authority commenced or threatened against the Borrower or
any other member of the Borrower Affiliated Group regarding any Environmental
Claim, (ii) any spill, release, discharge or disposal of any Hazardous Material
on any Real Property owned or leased by any member of the Borrower Affiliated
Group, or (iii) any violation of any Environmental Law by any member of the
Borrower Affiliated Group that (with respect to any of the foregoing) could
reasonably be expected to have a Material Adverse Effect, written notice
thereof, copies of all correspondence, reports and other materials furnished to
or prepared by any member of the Borrower Affiliated Group (or its
representatives) in connection therewith and the action being or proposed to be
taken with respect thereto; and 

     

         (i)
from time to time, with reasonable promptness, such other financial data and
other information or documents (financial or non-financial) about the Borrower
and each other member of the Borrower Affiliated Group (including accountants’
management letters and annual budgets) as the Administrative Agent may
reasonably request. 

     

         5.2.
Conduct of Business. The Borrower shall, and shall cause
each other member of the Borrower Affiliated Group to: 

     

         (a)
duly observe and comply in all material respects with all applicable laws and
requirements of any governmental authorities relative to its corporate
existence, rights and franchises, to the conduct of its business and to its
property and assets (including without limitation all Environmental Laws and
ERISA), and with the material provisions of all material Leases and all other
material contracts and agreements, and shall maintain and keep in full force and effect all licenses and
permits necessary in any material respect to the proper conduct of its
business;

     

    47

     

    

    
    



         (b) subject to Section 6.5(b), maintain its corporate existence (except
that immaterial Subsidiaries may be dissolved (with any remaining assets being
transferred to a member of the Borrower Affiliated Group);

     

         (c)
remain engaged in substantially the same lines of business as those in which it
is now engaged, except that the Borrower or any other member of the Borrower
Affiliated Group may withdraw from any business activity which its Board of
Directors reasonably deems unprofitable or unsound, provided that promptly after such withdrawal, the
Borrower shall provide the Administrative Agent with written notice thereof;
and

     

         (d)
promptly upon forming any Significant Subsidiary, or promptly upon any existing
Subsidiary satisfying the definition of a Significant Subsidiary, deliver to the
Administrative Agent a Subsidiary Guarantee and a written legal opinion with
respect thereto, addressed to the Administrative Agent and the Banks, in a form
reasonably acceptable to the Administrative Agent.

     

        
5.3. Maintenance and
Insurance. The
Borrower shall, and shall cause each other member of the Borrower Affiliated
Group to, maintain its properties in good repair, working order and condition
(normal wear and tear excepted) as required for the normal conduct of its
business, and from time to time the Borrower will make or cause to be made, and
cause each other member of the Borrower Affiliated Group to make or cause to be
made, all necessary and proper repairs, renewals, replacements, additions and
improvements thereto so that the Borrower and such other members of the Borrower
Affiliated Group may conduct its business substantially as conducted on the
Closing Date, and shall maintain or cause to be maintained all material Leases
as may be required for the conduct of the Borrower’s and each other member of
the Borrower Affiliated Group’s business. The Borrower shall and shall cause
each other member of the Borrower Affiliated Group to at all times maintain
liability and casualty insurance with financially sound and reputable insurers
in such amounts as the officers of the Borrower and such other member of the
Borrower Affiliated Group in the exercise of their reasonable judgment deem to
be adequate.

     

        
5.4. Taxes. The Borrower shall, and shall cause
each other member of the Borrower Affiliated Group to, pay or cause to be paid
all taxes, assessments or governmental charges on or against it or its
properties on or prior to the time when they become due; provided that this covenant shall not apply to any
tax, assessment or charge that is being contested in good faith by appropriate
proceedings and with respect to which adequate reserves have been established
and are being maintained in accordance with GAAP if no lien shall have been
filed to secure such tax, assessment or charge.

     

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         5.5. Inspection by the Administrative
Agent. The Borrower
shall, and shall cause each other member of the Borrower Affiliated Group to,
permit the Banks, through the Administrative Agent or the Administrative Agent’s
designee, at such reasonable times during normal business hours, upon reasonable
advance notice to such Person, to visit and inspect the properties and books and
records of the Borrower and such other members of the Borrower Affiliated
Group, provided that (i) when an Event of Default has
occurred and is continuing the Administrative Agent or any Bank (through the
Administrative Agent’s designee or such Bank’s other designee) may do any of the
foregoing at any time during normal business hours and with reasonable advance
notice, (ii) except during the existence of an Event of Default, any such
inspections shall be made no more frequently than once per year, and (iii)
unless the Administrative Agent believes that a Default or Event of Default is
reasonably likely to occur based upon information obtained by or provided to the
Administrative Agent, if no Default or Event of Default exists at the time of
any such inspection, any such inspection shall be at the expense of the
Banks.

     

        
5.6. Maintenance of Books and
Records. The Borrower
shall, and shall cause each other member of the Borrower Affiliated Group to,
keep adequate books and records of account, in which true and complete entries
will be made reflecting all of its business and financial transactions, and such
entries will be made in accordance with GAAP and applicable law.

     

        
5.7 Use of Proceeds. The proceeds of the Loans will be used
by the Borrower solely to fund capital expenditures, to fund repurchases of the
Borrower’s stock (such stock to be retired upon its repurchase), to provide
working capital for the Borrower Affiliated Group, and for general corporate
purposes for the Borrower Affiliated Group. No portion of any Loans shall be
used for the purpose of purchasing or carrying any “margin security” or “margin
stock” as such terms are used in Regulations U or X of the Board of Governors of
the Federal Reserve System.

     

        
5.8. Pension Plans. With respect to any Plan, the Borrower
will, and will cause each Significant Subsidiary and each other member of the
Controlled Group to, (i) fund each Plan as required by the provisions of Section
412 of the Code; (ii) cause each Plan to pay all benefits when due; and (iii)
furnish the Administrative Agent (a) promptly with a copy of any notice of each
Plan’s termination sent to the PBGC and (b) no later than the date of submission
to the Department of Labor or to the Internal Revenue Service, as the case may
be, a copy of any request for a material waiver from the funding standards or
extension of the amortization periods required by Section 412 of the
Code.

     

        
5.9. Fiscal Year. The Borrower and each other member of
the Borrower Affiliated Group shall have a fiscal year running concurrently with
the National Retail Federation calendar and shall notify the Administrative
Agent of any change in such fiscal year (whereupon, notwithstanding the
provisions of Section 9.8, the Administrative Agent and the Banks shall have the
right to modify the timing of the financial covenants hereunder accordingly in
order to correspond to any such change in fiscal year).

     

        
5.10. Further Assurances. At any time and from time to time the
Borrower shall, and shall cause each of other member of the Borrower Affiliated
Group to, execute and deliver such further instruments and take such further
action as may reasonably be requested by the Administrative Agent to effect the
purposes of the Loan Documents. In furtherance and not in limitation of the
foregoing, if the deliveries made pursuant to Section 3.1.13 reveal any Encumbrances other than
Permitted Encumbrances, the Borrower and the other members of the Borrower
Affiliated Group covenant and agree that they shall terminate such Encumbrances
on or before April 30, 2004. 

     

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    SECTION VI

     

    NEGATIVE COVENANTS

     

         So long as any Bank has any commitment to make Loans and issue Letters of
Credit hereunder or any Loan or other Obligation hereunder remains outstanding,
the Borrower covenants as follows on behalf of itself and each other member of
the Borrower Affiliated Group:

     

        
6.1. Indebtedness. The Borrower shall not, and shall not
permit any other member of the Borrower Affiliated Group to, create, incur,
assume, guarantee or be or remain liable with respect to any Indebtedness other
than the following:

     

         (a)
Indebtedness of the Borrower to the Administrative Agent or the Banks under any
Loan Document;

     

         (b)
Indebtedness in respect of accounts payable and accrued expenses for normal
recurring operating items, other than for borrowed money, of the Borrower
Affiliated Group incurred in the ordinary course of business;

     

         (c)
Indebtedness for borrowed money (which shall include all Indebtedness referenced
in clauses (i) through (iv) of the definition of Indebtedness and any guarantees
thereof), so long as the material terms of such Indebtedness are no more
restrictive with respect to covenants and events of default or other material
provisions than the terms and conditions set forth herein and in the other Loan
Documents, provided that at the time the Borrower or any
other member of the Borrower Affiliated Group incurs such Indebtedness, and
after giving effect thereto, no Default or Event of Default exists (it being
agreed that upon the incurrence of any such Indebtedness in excess of
$50,000,000 in one or a series of transactions, the Borrower will furnish to the
Administrative Agent a compliance certificate demonstrating compliance with
Sections 6.6 and 6.7 after giving effect to such Indebtedness; and

     

         (d)
Indebtedness existing on the date of this Agreement and disclosed on
Exhibit B hereto (or refinancings
thereof).

     

        
6.2. Contingent Liabilities. The Borrower shall not, nor shall
permit any other member of the Borrower Affiliated Group to, create, incur,
assume or remain liable with respect to any Guarantees other than the
following:

     

         (a)
Guarantees in favor of the Administrative Agent or the Banks under any Loan
Document;

     

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         (b) Guarantees existing on the date of this Agreement and disclosed
on Exhibit B hereto;

     

         (c)
Guarantees resulting from the endorsement of negotiable instruments for
collection in the ordinary course of business;

     

         (d)
Guarantees with respect to surety, performance and return-of-money and other
similar obligations incurred in the ordinary course of business and consistent
with past practices (exclusive of obligations for the payment of borrowed
money); and

     

         (e)
Guarantees of Indebtedness permitted under Section 6.1, provided that the aggregate amount of guarantees
by the Borrower of Indebtedness of Subsidiaries of the Borrower that have not
provided a Subsidiary Guarantee, plus the aggregate amount of Qualified
Investments described in clause (b) of the definition of “Qualified
Investments,” shall not at any time exceed fifteen percent (15%) of the
Borrower’s Consolidated Tangible Net Worth, determined as of the date of the
most recently completed fiscal quarter.

     

        
6.3. Sale and Leaseback. The Borrower shall not, nor shall
permit any other member of the Borrower Affiliated Group to, enter into any
arrangement, directly or indirectly, whereby it shall sell or transfer any
property owned by it in order to lease such property or lease other property
that the Borrower or such other member of the Borrower Affiliated Group intends
to use for substantially the same purpose as the property being sold or
transferred, except, notwithstanding the provisions of Section 6.5, with respect
to any such sale leaseback transaction in which the property sold is sold at
fair market value and on an arms-length basis and the lease of the property
contains market rent (not above-market rent) and is on an arms-length
basis, provided that (i) at the time any such sale
leaseback transaction is consummated and after giving effect thereto, no Default
or Event of Default exists, and (ii) the entering into of such sale leaseback
transaction would not reasonably be expected to have a Material Adverse
Effect.

     

        
6.4. Encumbrances. The Borrower shall not, nor shall
permit any other member of the Borrower Affiliated Group to, create, incur,
assume or suffer to exist any mortgage, pledge, security interest, lien or other
charge or encumbrance, including the lien or retained security title of a
conditional vendor upon or with respect to any of its property or assets
(“Encumbrances”), or assign or otherwise convey any
right to receive income, including the sale or discount of accounts receivable
with or without recourse, except the following (each, a “Permitted Encumbrance”):

     

         (a)
Encumbrances in favor of the Administrative Agent or the Banks under any Loan
Document;

     

         (b)
Encumbrances existing on the date of this Agreement and disclosed in
Exhibit B hereto;

     

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         (c) Liens for taxes, fees, assessments
and other governmental charges to the extent that payment of the same may be
postponed or is not required, in accordance with the provisions of Section 5.4,
and liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customs duties or in connection with the importation of
goods in the ordinary course of business;

     

         (d) Landlords’ and lessors’ liens in
respect of rent not in default; liens in respect of pledges or deposits under
worker’s compensation, unemployment insurance, social security laws, or similar
legislation (other than ERISA) or in connection with appeal and similar bonds
incidental to litigation; mechanics’, laborers’, carriers’, warehousemans’,
materialmen’s and similar liens, if the obligations secured by such liens are
not then delinquent; liens securing the performance of bids, tenders, contracts
(other than for the payment of money); and statutory obligations incidental to
the conduct of its business and that do not in the aggregate materially detract
from the value of its property or materially impair the use thereof in the
operation of its business;

     

         (e) Judgment liens that shall not
have been in existence for a period longer than 30 days after the creation
thereof or, if a stay of execution shall have been obtained, for a period longer
than 30 days after the expiration of such stay;

     

         (f) Easements, rights of way,
restrictions, encroachments, covenants running with the land and other similar
charges or Encumbrances relating to real property and not interfering in a
material way with the ordinary conduct of its business;

     

         (g) Purchase money liens and liens
on real property securing construction or permanent real estate financing
where:

     

    
      	        	(i)	        	with respect
      to liens on real property under Synthetic Leases, any such lien does not
      exceed an amount equal to 100% of the lessor’s (or the lessor’s lender’s)
      contribution to the costs of the real property and improvements under the
      Synthetic Lease agreements, including amounts incurred under such
      Synthetic Leases on account of bank fees, closing expenses, capitalized
      interest and other similar obligations; and
	
            	 
	
            	(ii)	
            	in all other
      cases, the lien does not exceed 100% of the cost of the real property and
      all improvements thereon and does not extend beyond the property purchased
      or constructed;


    

     

         (h) Security interests and liens
securing charges or obligations of the Borrower Affiliated Group in amounts not
to exceed $15,000,000 in the aggregate outstanding at any time in addition to
those Encumbrances permitted under subsections (a) through (g) of this
Section, provided, however, that with respect to purchase money
liens securing the purchase price of capital assets (including rights of lessors
under capital leases), (A) each such Encumbrance is given solely to secure the
purchase price of, or the lease obligations relating to, such asset, does not
extend to any other property and is given at the time or within 30 days of the
acquisition of such asset, and (B) the Indebtedness secured thereby does not
exceed the lesser of the cost of
such asset or its fair market value at the time such security interest attaches;
and 

     

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         (i) Security interests in favor of the issuer of any documentary letters
of credit for the account of the Borrower covering any documents presented in
connection with a drawing under any such letter of credit; all goods which are
described in such documents or any such letter of credit; and the proceeds
thereof. 

     

         6.5.
Merger; Consolidation; Sale or Lease of
Assets; Acquisitions.
The Borrower shall not, nor shall it permit any other member of the Borrower
Affiliated Group to:

     

         (a)
sell, lease or otherwise dispose of assets or properties (valued at the lower of
cost or fair market value), other than (i) sales of inventory in the ordinary
course of business, (ii) the disposition of scrap, waste and obsolete items in
the ordinary course of business, (iii) transfers of assets among members of the
Borrower Affiliated Group who are either the Borrower or a wholly-owned
Subsidiary of the Borrower that has provided a Subsidiary Guarantee, provided,
however, that each such asset transfer constitutes a Qualified Investment, and
(iv) sales of assets not in the ordinary course of business so long as the net
book value of all of such assets sold or otherwise disposed of by the Borrower
and the other members of the Borrower Affiliated Group in all such transactions
after the Closing Date shall not exceed an aggregate amount equal to fifteen
percent (15%) of the Borrower’s Consolidated Tangible Net Worth, determined as
of the end of the most recently completed fiscal quarter of the Borrower;
and

     

         (b)
liquidate, merge or consolidate into or with any other Person or enter into or
undertake any plan or agreement of liquidation, merger or consolidation with any
other Person, provided that the Borrower may merge with another
entity in connection with a Permitted Acquisition if the Borrower is the
surviving company, and any wholly-owned Subsidiary of the Borrower may merge or
consolidate into or with (i) the Borrower if no Default or Event of Default has
occurred and is continuing or would result from such merger and if the Borrower
is the surviving company, (ii) any other wholly-owned Subsidiary of the
Borrower; or (iii) a merger of a wholly-owned Subsidiary of the Borrower with
another entity in connection with a Permitted Acquisition if the Subsidiary is
the surviving entity; or

     

         (c)
make any acquisition of all or substantially all of the capital stock (or other
equity interests) or all or substantially all of the assets of another Person,
or of a division or business unit of a Person, whether or not involving a merger
or consolidation with such Person (an “Acquisition”), except for Permitted
Acquisitions. 

     

         6.6.
Minimum Adjusted Interest Coverage
Ratio. The Borrower
shall not permit the Adjusted Interest Coverage Ratio of the Borrower Affiliated
Group as at the last day of any fiscal quarter, calculated for the four
consecutive fiscal quarters then ending, to be less than the ratio of 2.0 to
1.0. 

     

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         6.7. Maximum Adjusted Debt to Total
Capitalization Ratio.
The Borrower shall not permit the Adjusted Debt to Total Capitalization Ratio
(expressed as a percentage) of the Borrower Affiliated Group as at the last day
of any fiscal quarter to be greater than 75%.

     

         6.8. Restricted Payments. The Borrower shall not, and shall not
permit any other member of the Borrower Affiliated Group to, pay, make or
declare any Restricted Payment other than (a) dividends or distributions by the
Borrower’s Subsidiaries to the Borrower or to a wholly-owned Subsidiary of the
Borrower that has provided a Subsidiary Guarantee, (b) redemptions and
repurchases by the Borrower of its stock, and (c) dividends paid by the Borrower
to its stockholders, so long as no Default or Event of Default has occurred or
is continuing, both before and after giving effect to any such distributions,
dividends, redemptions and repurchases. Neither the Borrower nor any other
member of the Borrower Affiliated Group will enter into any agreement, contract
or arrangement (other than the Loan Documents) restricting the ability of any
Subsidiary of the Borrower or any other member of the Borrower Affiliated Group
to pay or make dividends or distributions in cash or kind, to make loans,
advances or other payments of any nature or to make transfers or distributions
of all or any part of its assets to the Borrower or any other member of the
Borrower Affiliated Group.

     

         6.9. Investments. The Borrower shall not, nor shall
permit any other member of the Borrower Affiliated Group to, make or maintain
any Investments other than Permitted Investments.

     

         6.10. ERISA. Neither the Borrower, nor any
Significant Subsidiary or any member of the Controlled Group, shall permit any
Plan maintained by it to (i) engage in any Prohibited Transaction that could
reasonably be expected to result, individually or in the aggregate, in a
liability to the United States Internal Revenue Service in excess of
$10,000,000, (ii) incur any material “accumulated funding deficiency” (as
defined in Section 302 of ERISA) whether or not waived, or (iii) terminate any
Plan in a manner that could result in the imposition of a lien or encumbrance on
the assets of the Borrower or any Significant Subsidiary pursuant to Section
4068 of ERISA.

     

         6.11. Transactions with
Affiliates. The
Borrower shall not, nor shall permit any other member of the Borrower Affiliated
Group to, enter into or participate in any agreements or transactions of any
kind with any Affiliate, except (i) agreements or transactions contemplated,
required or allowed by any Loan Document; (ii) agreements or transactions (in
each case) in the ordinary course of business and on an arms-length basis which
(A) include only terms which are fair and equitable to the Borrower or such
other member of the Borrower Affiliated Group, (B) do not violate or otherwise
conflict with any of the terms of any of the Loan Documents, and (C) involve
terms no less favorable to the Borrower or such other member of the Borrower
Affiliated Group than would be the terms of a similar agreement or transaction
with any Person other than an Affiliate; and (iii) the loans permitted by
Section 6.12. Neither the Borrower nor any other member of the Borrower
Affiliated Group will enter into any agreement containing any provision which
would be violated or breached by the performance by the Borrower or such other
member of the Borrower Affiliated
Group of its obligations hereunder or under any of the other Loan Documents.


     

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         6.12. Loans. The Borrower shall not, and shall not
permit any other member of the Borrower Affiliated Group to, make to any Person
any loan, advance or other transfer with the anticipation of repayment, except
as may be otherwise expressly permitted hereunder and except for loans and
advances to employees of the Borrower or such other member of the Borrower
Affiliated Group that are (a) made in the ordinary course of business, (b)
consistent with past practices, and (c) permitted under then-applicable
law.

     

    SECTION VII

     

    DEFAULTS

     

        
7.1. Events of Default. There shall be an Event of Default
hereunder if any of the following events occurs:

     

         (a)
the Borrower shall fail to pay (i) any amount of principal of any Loans when due
or (ii) any amount of interest thereon or any fees or expenses payable hereunder
or under any Loan Document within five (5) Business Days after notice thereof
from the Administrative Agent to the Borrower; or

     

         (b)
the Borrower or any Significant Subsidiary shall (i) fail to deliver the reports
required by Section 5.1(c) within 5 Business Days of the date due or (ii) fail
to perform, comply with or observe or shall otherwise breach any one or more of
the terms, obligations, covenants or agreements contained in any of Sections
5.1(a), 5.1(b), 5.1(e), 5.1(f), 5.2(b), 5.2(c), 5.2(d), 5.5, 5.7, 5.8(iii), or
Section 6 (other than clauses (i) or (ii) of Section 6.10), provided, however, that with respect to the covenants
contained in Sections 5.1(a) and 5.1(b), the failure to deliver such financial
statements shall not constitute an Event of Default hereunder if such financial
statements have been posted on the Borrower’s website;

     

         (c)
the Borrower or any Significant Subsidiary shall fail to perform, comply with or
observe or shall otherwise breach any one or more of the terms, covenants,
obligations or agreements (other than in respect of subsections 7.1(a) and
7.1(b) hereof) contained in this Agreement or in any other Loan Document and
such failure shall continue for 30 days after notice thereof by the
Administrative Agent; or

     

         (d)
any representation or warranty of the Borrower or any other member of the
Borrower Affiliated Group made in any Loan Document or any other documents or
agreements executed in connection with the transactions contemplated by this
Agreement or in any certificate delivered hereunder shall prove to have been
false in any material respect upon the date when made or deemed to have been
made; or

     

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         (e)
the Borrower or any other member of the Borrower Affiliated Group shall fail to
pay at maturity, or within any applicable period of grace, any Material
Indebtedness, or fail to
observe or perform any term, covenant or agreement evidencing or securing such
Material Indebtedness, and as a result of such failure the holder or holders of
such Material Indebtedness have caused such Material Indebtedness to become due
prior to its stated maturity or, as to any agreement evidencing such Material
Indebtedness, terminated or cancelled such agreement; or

     

         (f)
the Borrower or any Significant Subsidiary shall be Insolvent under clause (iv),
clause (vi), or clauses (viii) through (xiv), inclusive, of the definition of
Insolvent; or

     

         (g)
judgments or orders for the payment of money shall be entered against the
Borrower or any other member of the Borrower Affiliated Group by any court, or a
warrant of attachment or execution or similar process shall be issued or levied
against property of the Borrower or any other member of the Borrower Affiliated
Group (the foregoing, collectively, “Judgments”), that in the aggregate exceed
$25,000,000 in value (to the extent not covered by independent third party
insurance as to which the insurer does not dispute coverage) and such Judgments
shall continue undischarged or unstayed for 60 days (provided, however, that if such undischarged or unstayed
Judgments in the aggregate exceed $25,000,000 but do not in the aggregate exceed
$50,000,000, such entry of such Judgments shall not constitute an Event of
Default hereunder so long as the Borrower or such other member of the Borrower
Affiliated Group could pay all of such undischarged or unstayed Judgments
without breaching Section 6.6 or Section 6.7 hereof after giving effect to such
payment); or

     

         (h)
the Borrower, any Significant Subsidiary or any member of the Controlled Group
shall fail to pay when due an aggregate amount in excess of $10,000,000 which it
shall have become liable to pay to the PBGC or to a Plan under Title IV of
ERISA; or notice of intent to terminate a Plan or Plans in a distress
termination under Section 4062 of ERISA shall be filed by the Borrower, any
Significant Subsidiary or any member of the Controlled Group; or the PBGC shall
institute or have grounds to institute proceedings under Title IV of ERISA to
terminate or to cause a trustee to be appointed to administer any such Plan or
Plans or a proceeding shall be instituted by a fiduciary of any such Plan or
Plans against the Borrower, any Significant Subsidiary or any member of the
Controlled Group and such proceedings shall not have been dismissed within 90
days thereafter; or

     

         (i) a Change of Control shall have
occurred without the express prior written consent of the Majority Banks;
or

     

         (j) the Borrower or any other member of
the Borrower Affiliated Group shall be enjoined, restrained or in any way
prevented by the order of any court or any administrative or regulatory agency
from conducting any material part of the business of the Borrower and the
Borrower Affiliated Group taken as a whole and such order shall continue in
effect for more than 60 days, or the Borrower or any other member of the
Borrower Affiliated Group shall be indicted for a state or federal crime, or any
criminal action shall otherwise have been brought or threatened against the
Borrower or any other member of the Borrower Affiliated Group, a punishment for
which in any such case could include forfeiture of any assets of the Borrower Affiliated Group
having a fair market value in excess of $25,000,000; or 

     

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         (k) there shall occur the loss,
suspension or revocation of, or failure to renew, any license or permit now held
or hereafter acquired if such loss, suspension, revocation or failure to renew
would reasonably be expected to have a Material Adverse Effect; or

     

         (l) (A) any material covenant, agreement
or obligation of the Borrower or any Significant Subsidiary contained in or
evidenced by any Loan Document to which the Borrower or such Significant
Subsidiary is a party shall, prior to the date on which such document shall
terminate in accordance with its terms, cease in any material respect to be
legal, valid, binding or enforceable in accordance with the terms thereof, or
(B) any Subsidiary Guarantee shall be terminated without the consent of the
Administrative Agent and each of the Banks prior to payment in full of all
Obligations; or

     

         (m) any Loan Document shall be
canceled, terminated, revoked or rescinded (or any notice of such cancellation,
termination, revocation or rescission given) otherwise than with the express
prior written agreement, consent or approval of the Administrative Agent and the
Banks; or any action at law, suit in equity or other legal proceeding to cancel,
revoke, or rescind any Loan Document shall be commenced by or on behalf of the
Borrower or any other member of the Borrower Affiliated Group, or by any court
or any other governmental or regulatory authority or agency of competent
jurisdiction; or any court or any other governmental or regulatory authority or
agency of competent jurisdiction shall make a determination that, or shall issue
a judgment, order, decree or ruling to the effect that, any one or more of the
Loan Documents or any one or more of the obligations of the Borrower or any
other member of the Borrower Affiliated Group under any one or more of the Loan
Documents are illegal, invalid or unenforceable in accordance with the terms
thereof to such an extent that the Administrative Agent and the Banks are unable
to enforce, in whole or in part, any material provisions of the Loan Documents,
as determined by the Administrative Agent and the Banks in their sole
discretion.

     

         7.2. Remedies. Upon the occurrence of an Event of
Default described in Section
7.1(f), immediately and automatically, and upon the occurrence of any other
Event of Default, at any time thereafter while such Event of Default is
continuing, at the option of the Majority Banks and upon the Administrative
Agent’s declaration:

     

         (a) each Bank’s commitment (whether
in its capacity as a Swingline Lender, Issuing Bank or otherwise) to make any
further Loans or issue additional Letters of Credit hereunder shall
terminate;

     

         (b) the unpaid principal amount of
the Loans together with accrued interest, all other Obligations, and all other
obligations of the Borrower to the Administrative Agent and each Bank of any
kind shall become immediately due and payable without presentment, demand,
protest or further notice of any kind, all of which are hereby expressly
waived;

     

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         (c) with respect to existing Letters of Credit, the Borrower shall
provide to the Administrative Agent cash collateral in an amount equal to the
aggregate Stated Amount of Letters of Credit outstanding; and 

     

         (d) the Administrative Agent may exercise
(on behalf of itself and the Banks) any and all rights the Administrative Agent
and the Banks have under this Agreement, the Subsidiary Guarantees, the other
Loan Documents or any other documents or agreements executed in connection
herewith, or at law or in equity, and proceed to protect and enforce the
Administrative Agent’s and the Banks’ rights by any action at law, in equity or
other appropriate proceeding. 

     

    SECTION VIII 

     

    CONCERNING THE ADMINISTRATIVE AGENT AND
THE BANKS


     

         8.1. Appointment and
Authorization. Each
of the Banks hereby appoints Fleet to serve as Administrative Agent under this
Agreement and irrevocably authorizes the Administrative Agent to take such
action on such Bank’s behalf under this Agreement and to exercise such powers
and to perform such duties under this Agreement and the other documents and
instruments executed and delivered in connection with the consummation of the
transactions contemplated hereby as are delegated to the Administrative Agent by
the terms hereof or thereof, together with all such powers as are reasonably
incidental thereto. 

     

         8.2. Administrative Agent and
Affiliates. Fleet
shall also have the same rights and powers under this Agreement of a Bank and
may exercise or refrain from exercising the same as though it were not the
Administrative Agent, and Fleet and its Affiliates may accept deposits from,
lend money to, and generally engage in any kind of business with the Borrower or
any other member of the Borrower Affiliated Group or any Affiliate of any member
of the Borrower Affiliated Group as if it were not the Administrative Agent
hereunder. Except as otherwise provided by the terms of this Agreement, nothing
herein shall prohibit any Bank from accepting deposits from, lending money to or
generally engaging in any kind of business with the Borrower or any other member
of the Borrower Affiliated Group or any Affiliate of any member of the Borrower
Affiliated Group. 

     

         8.3. Future Advances.

     

         (a) In order to more conveniently administer the Loans, the
Administrative Agent may, unless notified to the contrary by any Bank prior to
the date upon which any Revolving Credit Loan is to be made, assume that such
Bank has made available to the Administrative Agent on such date the amount of
such Bank’s share of such Revolving Credit Loan to be made on such date as
provided in this Agreement, and the Administrative Agent may (but it shall not
be required to), in reliance upon such assumption, make available to the
Borrower a corresponding amount. If any Bank makes available to the
Administrative Agent such amount on a date after the date upon which the
Revolving Credit Loan is made, such Bank shall pay to the Administrative Agent
on demand an amount equal to
the product of (i) the average computed for the period 

     

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    referred to in clause (iii) below, of the weighted average interest rate
paid by the Administrative Agent for federal funds acquired by the
Administrative Agent during each day included in such period, multiplied by (ii) the amount of such Bank’s share of
such Revolving Credit Loan, multiplied by (iii) a fraction, the numerator of which
is the number of days that elapsed from and including such date to the date on
which the amount of such Bank’s share of such Revolving Credit Loan shall become
immediately available to the Administrative Agent, and the denominator of which
is 360 or 365, as applicable. A statement of the Administrative Agent submitted
to such Bank with respect to any amounts owing under this subsection shall be
prima facie evidence of the amount due and owing to
the Administrative Agent by such Bank. 

     

         (b) The Administrative Agent may at any
time, in its sole discretion, upon notice to any Bank, refuse to make any
Revolving Credit Loan to the Borrower on behalf of such Bank unless such Bank
shall have provided to the Administrative Agent immediately available federal
funds equal to such Bank’s share of such Revolving Credit Loan in accordance
with this Agreement. 

     

         (c) Anything in this Agreement to the
contrary notwithstanding, the obligations to make Loans under the terms of this
Agreement shall be the several and not joint obligation of each of the Banks and
any advances made by the Administrative Agent on behalf of any Bank are strictly
for the administrative convenience of the parties and shall in no way diminish
any Bank’s liability to repay the Administrative Agent for such Loans and
advances. If the amount of any Bank’s share of any Revolving Credit Loan which
the Administrative Agent has advanced to the Borrower (including without
limitation any Revolving Credit Loan made or deemed to have been requested
pursuant to Section 2.1(b)(iii)(A)) is not made available to the Administrative
Agent by such Bank within 1 Business Day following the date upon which such
Revolving Credit Loan is made, the Administrative Agent shall be entitled to
recover such amount from the Borrower on demand, with interest thereon at the
rate per annum applicable to the Revolving Credit Loans made on such date.


     

         8.4. Delinquent Bank. Notwithstanding anything to the
contrary contained in this Agreement, any Bank that fails to make available to
the Administrative Agent its share of any Revolving Credit Loan when and to the
full extent required by the provisions of this Agreement shall be deemed
delinquent (a “Delinquent Bank”) and shall be deemed a Delinquent Bank until
such time as such delinquency is satisfied. A Delinquent Bank shall be deemed to
have assigned any and all payments due to it from the Borrower, whether on
account of outstanding Loans, interest, fees or otherwise, to the remaining
non-delinquent Banks for application to, and reduction of, their respective
pro rata shares of all outstanding Revolving
Credit Loans. The Delinquent Bank hereby authorizes the Administrative Agent to
distribute such payments to the non-delinquent Banks in proportion to their
respective pro rata shares of all outstanding Revolving
Credit Loans. A Delinquent Bank shall be deemed to have satisfied in full a
delinquency when and if, as a result of application of the assigned payments to
all outstanding Revolving Credit Loans of the non-delinquent Banks, the Banks’
respective pro rata shares of all outstanding Loans have returned to those
in effect immediately prior to such delinquency and without giving effect to the
nonpayment causing such delinquency. No Delinquent Bank shall have a right to
participate in any vote taken by the Banks hereunder, which shall be calculated
as if the Commitments of the Delinquent Bank did not exist. 

     

    59 

     

    

    
    


         8.5. Payments. 

     

         (a) All payments and prepayments of
principal of and interest on Revolving Credit Loans (other than Swingline Loans)
received by the Administrative Agent shall be paid to each of the Banks
pro rata in accordance with their respective
interests in such Loans; and any other payments received by the Administrative
Agent hereunder shall be paid to the Banks or the Administrative Agent or both
pro rata as their respective interests appear.
All such payments received by the Administrative Agent hereunder for the
accounts of the Banks prior to 1:00 p.m. on any Business Day shall be paid to
the Banks on such Business Day and all such payments received by the
Administrative Agent hereunder for the accounts of the Banks at or after 1:00
p.m. shall be paid to the Banks on the next Business Day. 

     

         (b) Each of the Banks and the
Administrative Agent hereby agrees that if it should receive any amount (whether
by voluntary payment, by the exercise of the right of set-off or banker’s lien,
by counterclaim or cross action, by the enforcement of any right hereunder or
otherwise) in respect of principal of, or interest on, the Loans or any fees
which are to be shared among the Banks, which, as compared to the amounts
theretofore received by the other Banks with respect to such principal, interest
or fees, is in excess of such Bank’s pro rata share of such principal, interest or
fees as provided in this Agreement, such Bank shall share such excess, less the
costs and expenses (including, reasonable attorneys’ fees and disbursements)
incurred by such Bank in connection with such realization, exercise, claim or
action, pro rata with all other Banks in proportion to
their respective interests therein, and such sharing shall be deemed a purchase
(without recourse) by such sharing party of participation interests in the Loans
or such fees, as the case may be, owed to the recipients of such shared payments
to the extent of such shared payments; provided, however, that if all or any portion of such
excess amount is thereafter recovered from such Bank, such purchase shall be
rescinded and the purchase price restored to the extent of such recovery, but
without interest. 

     

         8.6. Action by Administrative
Agent. 

     

         (a) The obligations of the Administrative
Agent hereunder are only those expressly set forth herein. The Administrative
Agent shall have no duty to exercise any right or power or remedy hereunder or
under any other document or instrument executed and delivered in connection with
or as contemplated by this Agreement or to take any affirmative action hereunder
or thereunder. 

     

         (b) The Administrative Agent shall keep
all records of the Loans and payments hereunder, and shall give and receive
notices and other communications to be given or received by the Administrative
Agent hereunder on behalf of the Banks. 

     

    60 

     

    

    
    


         (c) Upon the occurrence and during the continuance of an Event of Default
the Administrative Agent may, and upon the direction of the Majority Banks
pursuant to Section 7.2 the Administrative Agent shall, exercise the option of
the Banks pursuant to Section 7.2 to declare all Loans and other Obligations
immediately due and payable and may take such action as may appear necessary or
desirable to collect the Obligations and enforce the rights and remedies of the
Administrative Agent or the Banks. 

     

         8.7. Notification of Defaults and Events of
Default. The
Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default, except with respect to defaults
in the payment of principal, interest and fees required to be paid to the
Administrative Agent for the account of the Banks, unless the Agent shall have
received written notice from a Bank or the Borrower referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
“notice of default”. In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give notice thereof to the Banks.


     

         8.8. Consultation with
Experts. The
Administrative Agent shall be entitled to retain and consult with legal counsel,
independent public accountants and other experts selected by it and shall not be
liable to the Banks for any action taken, omitted to be taken or suffered in
good faith by it in accordance with the advice of such counsel, accountants or
experts. The Administrative Agent may employ administrative agents and
attorneys-in-fact and shall not be liable to the Banks for the default or
misconduct of any such administrative agents or attorneys. 

     

         8.9. Liability of Administrative
Agent. The
Administrative Agent shall exercise the same care to protect the interests of
each Bank as it does to protect its own interests, so that so long as the
Administrative Agent exercises such care it shall not be under any liability to
any of the Banks, except for the Administrative Agent’s gross negligence or
willful misconduct with respect to anything it may do or refrain from doing.
Subject to the immediately preceding sentence, neither the Administrative Agent
nor any of its directors, officers, administrative agents or employees shall be
liable for any action taken or not taken by it in connection herewith in its
capacity as Administrative Agent. Without limiting the generality of the foregoing, neither the
Administrative Agent nor any of its directors, officers, administrative agents
or employees shall be responsible for or have any duty to ascertain, inquire
into or verify: (i) any statement, warranty or representation made in connection
with this Agreement, any Loan Document, or any borrowing hereunder; (ii) the
performance or observance of any of the covenants or agreements of the Borrower;
(iii) the satisfaction of any condition specified in Sections 3.1 or 3.2, except
receipt of items required to be delivered to the Administrative Agent; or (iv)
the validity, effectiveness, enforceability or genuineness of this Agreement,
the Subsidiary Guarantees, any other Loan Document or any other document or
instrument executed and delivered in connection with or as contemplated by this
Agreement. The Administrative Agent shall not incur any liability by acting in
reliance upon any notice, consent, certificate, statement or other writing
(which may be a bank wire,
telecopy or similar writing) believed by it to be genuine or to be signed or
sent by the proper party or parties. 

     

    61 

     

    

    
    


         8.10. Indemnification. Each Bank and each Issuing Bank agrees
to indemnify the Administrative Agent (to the extent the Administrative Agent is
not reimbursed by the Borrower), ratably in accordance with its Revolving Credit
Commitment Percentage, from and against any cost, expense (including attorneys’
fees and disbursements), claim, demand, action, loss or liability which the
Administrative Agent may suffer or incur in connection with this Agreement, or
any action taken or omitted by the Administrative Agent hereunder, or the
Administrative Agent’s relationship with the Borrower hereunder, including,
without limitation, the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of its powers
and duties hereunder and of taking or refraining from taking any action
hereunder, but excluding any costs, expenses or losses directly arising from the
Administrative Agent’s gross negligence or willful misconduct. No payment by any
Bank under this Section shall in any way relieve the Borrower of its obligations
under this Agreement with respect to the amounts so paid by any Bank, and the
Banks shall be subrogated to the rights of the Administrative Agent, if any, in
respect thereto. 

     

         8.11. Independent Credit
Decision. Each of the
Banks represents and warrants to the Administrative Agent that it has,
independently and without reliance upon the Administrative Agent or any other
Bank and based on the financial statements referred to in Section 4.7 and such
other documents and information as it has deemed appropriate, made its own
independent credit analysis and decision to enter into this Agreement. Each of
the Banks acknowledges that it has not relied upon any representation by the
Administrative Agent and that the Administrative Agent shall not be responsible
for any statements in or omissions from any documents or information concerning
the Borrower, this Agreement, any other Loan Document or any other document or
instrument executed and delivered in connection with or as contemplated by this
Agreement. Each of the Banks acknowledges that it will, independently and
without reliance upon the Administrative Agent or other Bank 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. 

     

         8.12. Successor Administrative
Agent. Fleet, or any
successor Administrative Agent, may resign as Administrative Agent at any time
by giving 30 days prior written notice thereof to the Banks and to the Borrower.
Upon any such resignation, the Banks shall have the right to appoint a successor
Administrative Agent, which successor Administrative Agent shall be reasonably
acceptable to the Borrower. If no successor Administrative Agent shall have been
so appointed by the Banks, and shall have accepted such appointment, within 30
days after the retiring Administrative Agent’s giving of notice of resignation,
then the retiring Administrative Agent may, on behalf of the Banks, appoint a
successor Administrative Agent, which shall be a commercial bank (or Affiliate
thereof) or savings and loan association organized under the laws of the United
States of America or any State thereof or under the laws of another country
which is doing business in the United States of America or any State thereof and
having a combined capital, surplus and undivided profits of at least
$500,000,000 and shall be reasonably acceptable to the Borrower. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from all
further duties and obligations under this Agreement. After any retiring
Administrative Agent’s resignation or removal hereunder as Administrative Agent,
the provisions of this Section VIII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent under this
Agreement. 

     

    62 

     

    

    
    


         8.13.
Other Agents. None of the Banks identified on the
facing page, the preamble or the signature pages of this Agreement as a
"syndication agent" or a "co-documentation agent" shall have any right, power,
liability, responsibility or duty under this Agreement other than those
applicable to all Banks as such. Each Bank acknowledges that it has not relied,
and will not rely, on any of the Banks so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.

     

    SECTION IX 

     

    MISCELLANEOUS 

     

         9.1. Notices. Unless otherwise specified herein, all
notices hereunder to any party hereto shall be in writing and shall be deemed to
have been given (i) when delivered by hand, (ii) when sent by electronic
facsimile transmission with confirmation of receipt if sent prior to 5:00 p.m.
of the recipient’s prevailing time, and otherwise deemed to have been given on
the next Business Day, (iii) three (3) Business Days after being sent certified
mail, return receipt requested, and properly deposited in the mails, postage
prepaid, or (iv) one (1) Business Day after being delivered to an overnight
courier, addressed to such party at its address indicated below: 

     

         If to the Borrower, at 

     

              Ross
Stores, Inc.
          8333
Central Avenue
          Newark, CA
94560
         
John G. Call, Senior
Vice President and
              
Chief Financial Officer
          Fax: (510)
505-4181 

     

         with a copy to 

     

              Latham
& Watkins
         
505 Montgomery
Street
         
Suite 1900
          San
Francisco, CA 94111-2566
         
Attention: Kenneth
Blohm, Esq.
          Telecopy:
(415) 395-8095 

     

    63 

     

    

    
    


         If to the Administrative Agent or Fleet, at 

     

              Fleet
National Bank
         
Mail Stop: MA DE
10008F
         
40 Broad
Street
         
Boston, Massachusetts 02109
          Attention:
Stephen J. Garvin
          Telecopy:
(617) 434-6685 

     

         with a copy to 

     

              Goulston
& Storrs, P.C.
          400
Atlantic Avenue
          Boston,
Massachusetts 02110
          Attention:
Philip A. Herman, Esq.
          Telecopy:
(617) 574-4112

     

         If to any Bank, at the address for such
Bank set forth on Schedule 1 

     

    or at any other
address specified by such party in writing to the other parties listed in this
Section 9.1. Notwithstanding the foregoing, the Administrative Agent and the
Banks shall have been deemed for all purposes to have delivered any notice
required to be delivered to the Borrower Affiliated Group by this Agreement or
otherwise, by sending such notification to the address set forth above for the
“Borrower.” 

     

         9.2. Expenses. The Borrower shall: 

     

         (a) pay ten (10) days after receipt of
notice by Borrower all reasonable expenses of the Administrative Agent in
connection with the preparation, documentation, negotiation and execution of
this Agreement, the other Loan Documents or other documents executed in
connection therewith, and the consummation of the transactions contemplated
hereby and thereby, and any amendments (or other modifications, approvals,
consents or waivers) thereto, out-of-pocket expenses incurred in administration
of the Loans or other Obligations, and the cancellation or termination of this
Agreement and the other Loan Documents, including, without limitation, with
respect to all the foregoing, reasonable fees of outside legal counsel and any
local counsel, accounting, consulting or other similar professional fees or
expenses, and any fees or expenses associated with any travel or other costs
relating to any examinations conducted in connection with the Obligations
therefor; 

     

         (b) pay ten (10) days after receipt of
notice by Borrower all reasonable expenses of the Arranger and the
Administrative Agent incurred in connection with the syndication and/or
participation of the Loans, provided, however, that all such expenses incurred
prior to the Closing Date shall be paid on the Closing Date; and 

     

    64 

     

    

    
    


         (c) pay ten (10) days after receipt of notice by Borrower all reasonable
expenses of the Administrative Agent, the Banks, the Arranger and the
Co-Arranger incurred by them in connection with the enforcement, attempted
enforcement, or preservation of any rights or remedies during the existence of
an Event of Default (including in connection with any “workout” or restructuring
regarding the Loans, and including in any insolvency or appellate proceedings),
including, without limitation, reasonable fees of outside legal counsel, any
local counsel or the allocated costs of in-house legal counsel;

     

    and the amount of
all the foregoing expenses shall, from the end of such ten (10) day period until
paid, bear interest at the Prime Rate (including any default rate).


     

         9.3. Indemnification. The Borrower absolutely and
unconditionally indemnifies and holds harmless the Administrative Agent, the
Arranger, the Co-Arranger and each of the Banks against any and all claims,
demands, suits, actions, causes of action, damages, losses, settlement payments,
obligations, costs, expenses (including, without limitation, reasonable fees and
disbursements of a single legal counsel (and local counsel in any particular
jurisdiction) incurred in connection with any investigation, litigation or other
proceeding) and all other liabilities whatsoever which shall at any time or
times be incurred or sustained by the Administrative Agent, the Arranger, the
Co-Arranger or any of the Banks or by any of their shareholders, directors,
officers, employees, subsidiaries, affiliates or administrative agents (other
than as a result of the gross negligence or willful misconduct of the
Administrative Agent, the Arranger, the Co-Arranger or any of the Banks) on
account of, or in relation to, or in any way in connection with, the use of the
proceeds of the loans, the violation of any Environmental Laws or laws relating
to Hazardous Materials with respect to the Borrower and its Subsidiaries and
their respective properties and assets, and any of the arrangements or
transactions contemplated by, associated with or ancillary to either this
Agreement or any of the other Loan Documents, whether or not all or any of the
transactions contemplated by, associated with or ancillary to this Agreement or
any such Loan Documents are ultimately consummated. Without prejudice to the
survival of any other covenant of the Borrower hereunder, the covenants of this
Section 9.3 shall survive the termination of this Agreement and the payment or
satisfaction of payment of amounts owing with respect to any Loan Document.


     

         9.4. Set-Off. Regardless of the adequacy of any
collateral or other means of obtaining repayment of the Obligations, any
deposits, balances or other sums credited by or due from any Bank or any of its
branch or affiliate offices to the Borrower or any other member of the Borrower
Affiliated Group may, at any time and from time to time upon and during the
continuation of an Event of Default, without notice to the Borrower or such
member of the Borrower Affiliated Group or compliance with any other condition
precedent now or hereafter imposed by statute, rule of law, or otherwise (all of
which are hereby expressly waived) be set off, appropriated, and applied by any
Bank against any and all obligations of the Borrower or such member of the
Borrower Affiliated Group to such Bank or any of its affiliates in such manner
as the head office of the Bank or any of its branch offices in their sole
discretion may determine (with notice to be given to the Borrower promptly
thereafter). 

     

    65 

     

    

    
    


         9.5. Term of Agreement. This Agreement shall continue in force
and effect so long as any Bank has any commitment to make Loans hereunder or any
Loan or any Obligation shall be outstanding. 

     

         9.6. No Waivers. No failure or delay by the
Administrative Agent or any Bank in exercising any right, power or privilege
hereunder, under any Loan Document or under any other documents or agreements
executed in connection herewith shall operate as a waiver thereof; nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein and in the other Loan Documents provided are cumulative and not
exclusive of any rights or remedies otherwise provided by agreement or law.


     

         9.7. Governing Law. This Agreement and the other Loan
Documents shall be construed in accordance with and governed by the laws of the
State of New York (without giving effect to any conflicts of laws provisions
contained therein). Any legal action or proceeding arising out of or relating to
this Agreement, any other Loan Document or any Obligation may be instituted, in
the Administrative Agent’s sole discretion, in (a) the courts of the State of
New York or the United States of America for the Southern District of New York,
and (b) any appellate court to which appeals may be taken from the courts
referred to in (a), and each of the Borrower, the Administrative Agent and each
Bank hereby irrevocably submits to the jurisdiction of each such court in any
such action or proceeding; provided, however, that the foregoing shall not limit the
Administrative Agent’s rights to bring any legal action or proceeding in any
other appropriate jurisdiction. 

     

         9.8. Amendments, Waivers, Etc.
Except as otherwise expressly
provided in this Agreement or any of the other Loan Documents: (i) each of the
Loan Documents may be modified, amended or supplemented in any respect whatever
only with the prior written consent or approval of the Majority Banks and the
Borrower; and (ii) the performance or observance by the Borrower of any of its
covenants, agreements or obligations under any of the Loan Documents may be
waived only with the written consent of the Majority Banks; provided, however, that the following changes shall
require the written consent, agreement or approval of all of the Banks: (A) any
decrease in the amount of or postponement of the regularly scheduled or
otherwise required payment date for any of the Obligations (including, without
limitation, principal, interest and fees); (B) any decrease in the interest rate
on any Loan or the Commitment Fees due under this Agreement; (C) any increase in
the Commitment or Revolving Credit Commitment Percentage of any of the Banks,
except as permitted by Section 9.10; (D) any change in the definition of
Majority Banks; (E) the release or termination of any Subsidiary Guarantee, and
(F) any change in the terms of this Section 9.8. Any change to Section IX or any
other provision of this Agreement affecting the rights or obligations of the
Administrative Agent shall not be amended or modified without the prior or
concurrent written consent of the Administrative Agent. 

     

         9.9. Binding Effect of
Agreement. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns; provided that (i) the Borrower may not assign or
transfer its rights or obligations hereunder, and (ii) no Bank may assign or transfer its rights or
obligations hereunder to any Person except in accordance with the provisions of
Section 9.10. 

     

    66 

     

    

    
    


         9.10. Successors and Assigns. 

     

         (i) Any Bank may at any time grant to one
or more banks or other financial institutions (each, a “Participant”)
participating interests in any of its Commitments or any or all of its Loans in
an amount and on such terms as such Bank may deem appropriate. In the event of
any such grant by a Bank of a participating interest to a Participant, whether
or not upon notice to the Borrower and the Administrative Agent, such Bank shall
remain responsible for the performance of its obligations hereunder, and the
Borrower and the Administrative Agent shall continue to deal solely and directly
with such Bank in connection with such Bank’s rights and obligations under this
Agreement. Any agreement pursuant to which any Bank may grant such a
participating interest shall provide that such Bank shall retain the sole right
and responsibility to enforce the obligations of the Borrower hereunder
including, without limitation, the right to approve any amendment, modification
or waiver of any provision of this Agreement; provided, however, that such participation agreement may
provide that such Bank will not agree, without the consent of the Participant,
to any modification, amendment or waiver of this Agreement requiring the
consent, agreement or approval of all of the Banks, as described in Section 9.8.
The Borrower agrees that each Participant shall be entitled to the benefits of
Section 2.16 with respect to its participating interest.

     

         (ii) Any Bank (except the Swingline
Lender with respect to the Swingline Loans and the Swingline Commitment, unless
assigned as part of an Administrative Agent transfer under Section 8.12) may at
any time assign to one or more Eligible Assignees all, or a part of all, of its
rights, interests and obligations under this Agreement on such terms, as between
such Bank and each of its Eligible Assignees, as such Bank may deem appropriate,
and each Eligible Assignee shall assume such rights, interests and obligations,
pursuant to an instrument executed by such Assignee and such assignor Bank
substantially in the form of Exhibit F hereto (an “Assignment and Assumption”);
provided, however, that (A) prior to assigning any
interest to any Eligible Assignee hereunder, such Bank will (x) notify the
Borrower and the Administrative Agent in writing identifying the proposed
Eligible Assignee and stating the aggregate principal amount of the proposed
interest to be assigned, and (y) receive the prior written consent of the
Administrative Agent and, prior to the occurrence (which is continuing) of an
Event of Default, the Borrower, which consent may not be unreasonably withheld
by either the Borrower or the Administrative Agent, and (B) no Bank will assign
to any Eligible Assignee less than an aggregate amount equal to the lesser of
(x) $5,000,000 of such Bank’s Commitments and interest on the Loans (as such
interest may be reduced pursuant to the terms hereof) or (y) the remaining
amount of such Bank’s Commitments. It is understood and agreed that the proviso
contained in the immediately preceding sentence shall not be applicable in the
case of, and this subsection (ii) shall not restrict an assignment or other
transfer by any Bank to an Affiliate of such Bank or to any other Bank or a
collateral assignment or other similar transfer to a Federal Reserve Bank or an
assignment required under applicable law. Upon execution and delivery of such an
Assignment and Assumption
and payment by such Eligible Assignee to such transferor Bank of an amount equal
to the purchase price agreed between such transferor Bank and such Eligible
Assignee, such Eligible Assignee shall be a Bank party to this Agreement and
shall have all the rights, interests and obligations of a Bank with the
Commitments as set forth in such instrument of assumption, and the transferor
Bank shall be released from its obligations hereunder to a corresponding extent,
and no further consent or action by any party shall be required.

     

    67 

     

    

    
    


         (iii) No Assignee, Participant or other transferee of any Bank’s rights
shall be entitled to receive any greater payment under Sections 2.11, 2.12 and
2.16 than such Bank would have been entitled to receive with respect to the
rights transferred, unless such transfer is made with the Borrower’s prior
written consent or at a time when the circumstances giving rise to such greater
payment did not exist. 

     

         (iv) Assignments require a fee payable to
the Administrative Agent by the transferor Bank, solely for the account of the
Administrative Agent, in the amount of $3,500. 

     

         9.11. Counterparts. This Agreement may be signed in any
number of counterparts with the same effect as if the signatures hereto and
thereto were upon the same instrument and each counterpart shall be deemed an
original. 

     

         9.12. Partial Invalidity. The invalidity or unenforceability of
any one or more phrases, clauses or sections of this Agreement shall not affect
the validity or enforceability of the remaining portions of it. 

     

         9.13. Captions. The captions and headings of the
various sections and subsections of this Agreement are provided for convenience
only and shall not be construed to modify the meaning of such sections or
subsections. 

     

         9.14. WAIVER OF JURY
TRIAL. THE BORROWER, THE BANKS AND THE
ADMINISTRATIVE AGENT MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM, COUNTERCLAIM OR
DEFENSE BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH OR
ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR
WRITTEN) OR ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND THE
BANKS TO ENTER INTO THIS AGREEMENT AND TO MAKE LOANS AND EXTEND CREDIT TO THE
BORROWER. The Borrower (i) certifies that neither the Administrative Agent, nor
any Bank nor any representative, administrative agent or attorney of the
Administrative Agent or any Bank has represented, expressly or otherwise, that
the Administrative Agent or any Bank would not, in the event of litigation, seek
to enforce the foregoing waivers and (ii) acknowledges that, in entering into this Agreement and the other
Loan Documents to which the Borrower is a party, the Administrative Agent and
the Banks are relying upon, among other things, the waivers and certifications
contained in this Section 9.14. 

     

    68 

     

    

    
    


         9.15. Entire Agreement. This Agreement and the other Loan
Documents constitute the final agreement of the parties hereto and supersede any
prior agreement or understanding, written or oral, with respect to the matters
contained herein and therein. 

     

         9.16. Replacement of Loan Documents,
Etc. Upon receipt of
an affidavit of an officer of any Bank as to the loss, theft, destruction or
mutilation of one or more of the Loan Documents which is not of public record,
and, in the case of any such loss, theft, destruction or mutilation, upon
cancellation of such Loan Document and, with respect to any instrument, the
customary indemnification of the Borrower by such Bank, the Borrower will issue,
in lieu thereof, a replacement Loan Document containing the same terms and
conditions. 

     

         9.17 USA PATRIOT Act Notice. Each Bank and the Administrative Agent
(for itself and not on behalf of any Bank) hereby notifies the Borrower that,
pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L.107-56
(signed into law October 26, 2001)) (the "Act"), it is required to obtain,
verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will
allow such Bank or the Administrative Agent, as applicable, to identify the
Borrower in accordance with the Act; and the Borrower agrees to provide the
Administrative Agent and the Banks with any such information as the
Administrative Agent or any Bank may reasonably request. 

     

    69 

     

    

    
    


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


     

    
      	
            	
              The
      Borrower:

            
	
            	 
	
            	ROSS STORES, INC.
	
            	  
	
            	  
	 	By: 	          /s/ J.
      Call	 
	
            	  	Name: John G. Call
	
            	  	Title: Chief Financial
      Officer


    


    

    
    


    Counterpart
signature page to
Amended and Restated
Revolving Credit
Agreement,
dated as of March 31, 2004,
among Ross Stores, Inc.,
Fleet
National Bank, as Administrative Agent,
and certain other Lending
Institutions 

       

       

       

      
      

    

    
      	
            	The Administrative
      Agent:
	
            	 
	
            	FLEET NATIONAL BANK,
	
            	as Administrative Agent, and
      individually as a Bank
	
            	  
	
            	  
	 	By:  	          /s/ Linda
      Alto	 
	
            	
            	Name: Linda Alto
	
            	
            	Title:
Director


    


    

    
    


    Counterpart
signature page to
Amended and Restated
Revolving Credit
Agreement,
dated as of March 31, 2004,
among Ross Stores, Inc.,
Fleet
National Bank, as Administrative Agent,
and certain other Lending
Institutions 

       

       

        

    

    
      	
            	
              WACHOVIA
      BANK, N.A.,

            
	
            	
              as a Bank,
      and in its capacity as Syndication Agent

            
	
            	  
	
            	  
	
            	By:  	          /s/
      Kimberley A. Quinn	 
	 	  	Name: Kimberley A.
  Quinn
	
            	  	Title:
Director


    


    

    
    


    Counterpart
signature page to
Amended and Restated
Revolving Credit
Agreement,
dated as of March 31, 2004,
among Ross Stores, Inc.,
Fleet
National Bank, as Administrative Agent,
and certain other Lending
Institutions 

       

       

        

      
      

    

    
      	 	BANK ONE, NA,
	
            	as a Bank, and in its capacity as
      Co-Documentation Agent
	
            	 
	
            	 
	
            	By:  	          /s/ Marion
      M. Church	 
	
            	  	Name: Marion M. Church
	
            	  	Title:
  Associate


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending
Institutions

     

     

     

    
      	
            	BNP PARIBAS
	
            	as a Bank, and in its capacity as
      Co-Documentation
	
            	Agent
	
            	 
	
            	 
	 	By:	          /s/
      Katherine Wolfe	 
	
            	  	Name: Katherine Wolfe
	
            	  	Title: Director
	
            	  
	
            	  
	
            	By:	          /s/ Sandra
      F. Bertram	 
	
            	  	Name: Sandra F.
Bertram
	
            	  	Title: Vice
  President


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	WELLS FARGO BANK,
	
            	as a Bank, and in its capacity as
      Co-Documentation
	
            	Agent  
	
            	 
	
            	 
	
            	By:	          /s/ Jeff
      Bailard	 
	
            	
            	Name: Jeff Bailard
	 	
            	Title: Vice President
	
            	 
	
            	 
	
            	By:	          /s/ Roger J.
      Fleischmann	 
	
            	
            	Name: Roger
Fleischmann
	
            	
            	Title: Senior Vice President 
      


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	FLEET SECURITIES, INC.
	 	 
	
            	 
	
            	By:	          /s/ Jennifer
      P. Dumas	 
	
            	
            	Name: Jennifer P.
Dumas
	
            	
            	Title: Vice
  President


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	WACHOVIA CAPITAL MARKETS,
    LLC
	 	 
	
            	 
	
            	By:	          /s/
      Kimberley A. Quinn	 
	
            	
            	Name: Kimberley A.
  Quinn
	
            	
            	Title: Director 
  


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	BANK OF THE WEST
	 	 
	
            	 
	
            	By:	          /s/ Rochelle
      Dineen	 
	
            	
            	Name: Rochelle Dineen
	
            	
            	Title: Vice
  President


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	UNION BANK OF CALIFORNIA,
      N.A.
	
            	 
	
            	 
	
            	By:	          /s/ Theresa
      L. Rocha	 
	
            	
            	Name: Theresa L. Rocha
	
            	
            	Title: Vice President 
    


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	U.S. BANK NATIONAL
      ASSOCIATION
	 	 
	
            	 
	
            	By:	          /s/ Gregory
      L. Dryden	 
	
            	
            	Name: Gregory L.
Dryden
	
            	
            	Title: Vice President 
    


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	KEYBANK NATIONAL
    ASSOCIATION
	
            	 
	
            	 
	 	By:	          /s/ Michael
      J. Vegh	 
	
            	
            	Name: Michael J. Vegh
	
            	
            	Title: Portfolio
  Manager
	
            	 
	
            	 
	
            	By:	          /s/ Robert
      W. Boswell	 
	
            	
            	Name: Robert W.
Boswell
	
            	
            	Title: Vice President 
    


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	NATIONAL CITY BANK
	 	 
	
            	 
	
            	By:	          /s/ Joseph
      L. Kwasny	 
	
            	
            	Name: Joseph L. Kwasny
	
            	
            	Title: Senior Vice President 
      


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	SOUTHTRUST BANK
	
            	 
	
            	 
	 	By:	          /s/ Price
      Chenault	 
	
            	
            	Name: Price Chenault
	
            	
            	Title: Vice President 
    


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	SUNTRUST BANK
	
            	 
	
            	 
	 	By:	          /s/ Brian M.
      Davis	 
	
            	
            	Name: Brian M. Davis
	
            	
            	Title: Director 
  


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending
Institutions

     

     

     

    
      	
            	THE BANK OF NEW YORK
	 	 
	
            	 
	
            	By:	          /s/ Randolph
      E.J. Medrano	 
	
            	
            	Name: Randolph E.J. Medrano 
      
	
            	
            	Title: Vice President 
    


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	GUARANTY BANK
	
            	 
	
            	 
	 	By:	          /s/ Daniel
      K. Guth	 
	
            	
            	Name: Daniel K. Guth
	
            	
            	Title: Senior Vice President 
      


    


    

    
    



    Counterpart
signature page to 
Amended and Restated 
Revolving Credit Agreement,

dated as of March 31, 2004, 
among Ross Stores, Inc., 
Fleet National
Bank, as Administrative Agent, 
and certain other Lending Institutions


     

     

     

    
      	
            	ISRAEL DISCOUNT BANK OF NEW
      YORK
	
            	 
	 	 
	
            	By:	          /s/ Amir
      Barash	 
	
            	
            	Name: Amir Barash
	
            	
            	Title: First Vice President 
      
	
            	 
	
            	 
	
            	By:	          /s/ Lucas
      Ramirez	 
	
            	
            	Name: Lucas Ramirez
	
            	
            	Title: Assistant Manager 
      


    


    

    
    



    SCHEDULE 1 

     

    Commitment Amounts and Revolving Credit
Commitment Percentages 

     

    
      	
            	
            	
            	Commitment	
            	Commitment
	1)	     
      	Bank	Amount	      	Percentage
	
            	
            	Fleet National Bank	$	75,000,000	*	
            	12.5000	%
	
            	
            	100 Federal Street	
            	
            	
            	
            	
            	
            
	
            	
            	Boston, MA 02110	
            	
            	
            	
            	
            	
            
	 
	
            	
            	Wachovia Bank, N.A.	$	75,000,000	
            	
            	12.5000	%
	
            	
            	One Wachovia Center	
            	
            	
            	
            	
            	
            
	
            	
            	301 South College Street	
            	
            	
            	
            	
            	
            
	
            	
            	Charlotte, NC 28288	
            	
            	
            	
            	
            	
            
	 
	
            	
            	Bank One, NA	$	67,500,000	
            	
            	11.2500	%
	
            	
            	One Bank One Plaza	
            	
            	
            	
            	
            	
            
	
            	
            	Chicago, IL 60670	
            	
            	
            	
            	
            	
            
	 
	
            	
            	Wells Fargo Bank	$	57,500,000	
            	
            	9.5833	%
	
            	
            	555 Montgomery Street	
            	
            	
            	
            	
            	
            
	
            	
            	San Francisco, CA 94104	
            	
            	
            	
            	
            	
            
	 
	
            	
            	U.S. Bank National
      Association  	$	50,500,000	
            	
            	8.4167	%
	
            	
            	7th &
      Washington	
            	
            	 	
            	
            	
            
	
            	 	St. Louis, MO 63101	
            	
            	
            	
            	
            	
            
	 
	
            	
            	Union Bank of California,
      N.A.  	$	48,500,000	
            	
            	8.0833	%
	
            	
            	350 California Street	
            	
            	
            	
            	 	
            
	
            	
            	San Francisco, CA 94104	
            	
            	
            	
            	
            	
            
	 
	
            	
            	KeyBank National
    Association	$	48,500,000	
            	
            	8.0833	%
	
            	
            	70 Federal Street	
            	
            	
            	
            	
            	
            
	
            	
            	Boston, MA 02110	
            	
            	
            	
            	
            	
            
	 
	
            	
            	BNP Paribas	$	42,500,000	
            	
            	7.0833	%
	
            	
            	1 Front Street	
            	
            	
            	
            	
            	
            
	
            	
            	San Francisco, CA 94111	
            	
            	
            	
            	
            	 



    


    

    
    



    
      	         	National City Bank	$25,000,000	        	4.1667	%
	
            	155 E. Broad Street	
            	
            	
            	
            
	
            	Columbus, Ohio 43251-0077	
            	
            	
            	
            
	
            	 
	 	Southtrust Bank	$25,000,000	
            	4.1667	%
	
            	600 West Peachtree Street	
            	
            	
            	
            
	
            	Atlanta, GA 30308	
            	
            	
            	
            
	
            	 
	
            	SunTrust Bank	$25,000,000	
            	4.1667	%
	
            	303 Peachtree Street	
            	
            	
            	
            
	
            	Atlanta, GA 30308	
            	
            	
            	
            
	
            	 
	
            	The Bank of New York	$20,000,000	
            	3.3333	%
	
            	One Wall Street	
            	
            	
            	
            
	
            	New York, NY 10286	
            	
            	
            	
            
	
            	 
	
            	Guaranty Bank	$15,000,000	
            	2.5000	%
	
            	300 Capital Mall	
            	
            	
            	
            
	
            	Suite 1550	
            	
            	
            	
            
	
            	Sacramento, CA 95814	
            	
            	
            	
            
	
            	 
	
            	Bank of the West	$15,000,000	 	2.5000	%
	
            	180 Montgomery Street, 25th Floor	
            	
            	
            	
            
	
            	San Francisco, CA 94111	
            	
            	
            	
            
	
            	 
	
            	Israel Discount Bank of New
      York  	$10,000,000	
            	1.6667	%
	
            	511 Fifth Avenue, 6th Floor	
            	
            	
            	
            
	
            	New York, NY 10017	
            	
            	
            	
            
	
            	 
	
            	TOTAL	$600,000,000.00	
            	100.00	%


    
____________________

    *$60,000,000 of
Fleet’s Commitment Amount constitutes the Swingline Commitment of Fleet in its
capacity as the Swingline Lender. 

     

    

    
    



    SCHEDULE
2

     

    Carryover Letters
of Credit

     

    
      	
            	
            	
            	
            	Expiry
	Issuer
    (Beneficiary)	 	       	Amount	       	Date
	Fleet Bank (Ace American Insurance
      Company)	
            	413,309	
            	5/5/2004
	Fleet Bank (Bank of N.T.
      Butterfield and Son Limited)	
            	12,623,605	
            	12/13/2004


    


    

    
    


    EXHIBIT A

     

    [FORM OF NOTICE
OF BORROWING OR CONVERSION]

     

    ROSS STORES,
INC.

     

    Fleet National
Bank, as Administrative Agent
40 Broad Street, 10th Floor
Boston,
Massachusetts 02109

     

    
      	Re:	     	Amended and Restated Revolving Credit Agreement
	  	
            	Dated as of March 31, 2004 the
      “Agreement”)


    


    Ladies and
Gentlemen: 

     

         Pursuant to Section 2.4 of the Agreement
the undersigned hereby [requests] [confirms its request made by telephone on
___________________, 200__] for a [Prime Rate] [LIBOR] [Swingline] Loan in the
amount of $_______________ to be effective on ______________________, 200__. We
understand that this request is irrevocable and binding on us and obligates us
to accept the requested [Prime Rate] [LIBOR] [Swingline] Loan on such date.


     

         [The Interest Period applicable to said
Loan will be [one] [two] [three] [six] months.]* 

     

         [You have quoted us an interest rate for
such Swingline Loan of ________ in accordance with Section 2.9(a) of the
Agreement. If such interest rate is no longer applicable for such Swingline Loan
as of the date of this request, we may revoke this request notwithstanding the
introductory paragraph of this notice.]** 

     

         [Said Loan represents a [conversion]
[continuation] of the [Prime Rate] [LIBOR] Loan in respect of [a Revolving
Credit Loan] made on _________________.]*** 

     

         We hereby certify (a) that the aggregate
outstanding principal amount of the Revolving Credit Loans, plus (without duplication) the aggregate
principal amount of all Swingline Loans outstanding, plus the aggregate Stated Amount of Letters
of Credit outstanding, plus the aggregate amount of all unreimbursed
draws under outstanding Letters of Credit, on today’s date is $__________, (b)
that we will use the proceeds of the requested Loan in accordance with the
provisions of the Agreement, (c) that the representations and warranties
contained or referred to in Section IV of the Agreement are true and accurate in
all material respects on and as of the effective date of the Loan requested
hereby as though made at and as of such date (except to the extent that such
representations and warranties expressly relate to an earlier date), and (d)
that [no Default or Event of Default has occurred and is continuing or will
result from the making of the Loan]+ [no Event of Default
has occurred and is continuing or will result from the conversion or
continuation of the Loan]***.

     

    A-1

     

    

    
    


    
      	
            	
            	
            	
              ROSS
      STORES, INC.

            
	 	 	 	  
	Date:	 	              	 
	
            	
            	Title:


    


    
      	*	       	To be inserted in any request for a LIBOR Loan.
	**	
            	To be inserted in any request for a Swingline Loan.
	***	
            	To be inserted in any request for a conversion or
      continuation.
	+	
            	To be inserted in any request for a new Loan.
	++	
            	To be inserted in any request for a
  continuation.


    


    A-2

     

    

    
    


    EXHIBIT B

     

    INDEBTEDNESS;
ENCUMBRANCES

     

    6.1(d). Indebtedness of the Borrower as
of the Closing Date

     

    
      	
            	1.	
            	$50 million Senior Unsecured
      Delayed Draw Term Loan, maturing December 2006
	       	
            	       	
            
	
            	2.	
            	$87.3 million obligation under five
      year synthetic lease agreement, expiring May 2006 (classified as “debt”
      per loan covenants)
	
            	 
	
            	3.	
            	$70 million obligation under ten
      year synthetic lease agreement, expiring July 2013 (classified as “debt”
      per loan covenants)
	
            	 
	
            	4.	
            	$19.7 million obligation under two
      year synthetic lease obligation, expiring December 2005 (classified as
      “debt” per loan covenants)


    

     

    6.2(b). Guarantees (Standby Letters of
Credit) of the Borrower as of the Closing Date

     

    
      	
            	
            	
            	
            	Expiry
	Issuer
    (Beneficiary)	 	       	Amount	       	Date
	Bank of Butterfield (Green Island
      Reinsurance Pool)	
            	22,623,605	
            	1/1/2005
	SouthTrust Bank (Old Republic
      Insurance Company)	
            	18,200,000	
            	9/26/2004
	Fleet Bank (Ace American Insurance
      Company)	
            	413,309	
            	5/5/2004
	Wells Fargo (Old Republic Insurance
      Company)	
            	21,559,088	
            	1/31/2005
	SouthTrust Bank (Lumbermens Mutual
      Casualty Company	
            	416,489	
            	5/16/2004
	Fleet Bank (Bank of N.T.
      Butterfield and Son Limited)	
            	12,623,605	
            	12/13/2004


    


    6.4(b).
Encumbrances

     

    $19.7 million obligation under a two-year
synthetic lease, expiring December 2005, in respect of certain POS
equipment.

     

    B-1

     

    

    
    


    EXHIBIT C

     

    DISCLOSURE

     

    4.1. Borrower Affiliated Group (at
Closing Date)

     

    
      	 	
            	Federal	
            	 
	Affiliate	       	Tax ID #	       	State of Incorporation
	Ross Stores, Inc.	
            	94-1390387	
            	Delaware
	Ross Dress for Less,
      LLC	
            	94-3394968	
            	California
	Ross Support Services,
      LLC	
            	94-3394915	
            	California
	Ross Stores Administration
    Company	
            	94-3288850	
            	California
	Ross Stores Asset Management
      Company	
            	94-3288846	
            	California
	Ross Stores Asset II
      Company	
            	94-3288849	
            	California
	Ross Stores Asset I
      Company	
            	94-3288847	
            	California
	Ross Penngen, Inc.	
            	94-3318072	
            	California
	Ross Pennlim, Inc.	
            	94-3318073	
            	California
	Ross Limited Partner,
      LLC	
            	94-3394918	
            	California
	Ross General Partner,
      LLC	
            	94-3394917	
            	California
	Ross Newark, Inc. (Ross Newark
      Company)	
            	94-3040811	
            	California
	Ross Stores Resources,
      Inc.	
            	94-3288855	
            	California
	Ross Realty, Inc.	
            	94-3040812	
            	California
	Ross Distribution,
      Inc.	
            	94-3412776	
            	California
	Ross Stores Pennsylvania,
      LP	
            	94-3318074	
            	Pennsylvania
	Retail Assurance Group,
      Ltd.	
            	98-0126155	
            	Bermuda
	Ross Florida Dress for Less,
      LC	       	94-3288857	       	Florida
	Ross Stores Texas,
    LP	
            	94-3395130	
            	Texas
	Ross Card Services
      Company	
            	73-1689613	
            	 Virginia
	Ross Dress for Less,
      Inc.	
            	20-0594333	
            	 Virginia
	Ross Merchandising,
      Inc.	
            	20-0583163	
            	 Delaware


    


    C-1

     

    

    
    


    4.6. Franchises, Patents, Copyrights,
Etc.

     

         None to report.

     

    4.10. Taxes

     

    The Borrower has issued waivers of the
statute of limitations, extending the time for completion of certain tax audits,
in the following jurisdictions:

     

    
      	Jurisdiction	       	Tax Period	       	Extended to
	New York State	
            	
            	
            	
            
	(Sales & Use Tax)	
            	FY 2000 - 2003	
            	June 20, 2004
	 	
            	
            	
            	
            
	New York State	
            	
            	
            	
            
	(Income Tax)	
            	FY 1999 – 2000	
            	Aug 15, 2004
	City of Lakewood	
            	
            	
            	
            
	(Sales & Use)	
            	Apr 2000 - Mar 2003	
            	May 31, 2004
	 	
            	
            	
            	
            
	New Jersey	
            	
            	
            	
            
	(Sales & Use)	
            	Apr 1995 – Dec 1998	
            	May 31,
2004


    


    4.11
Litigation

     

         None to report.

     

    4.12
Subsidiaries

     

         No Significant Subsidiaries as of the
Closing Date.

     

    4.15 Environmental
Matters

     

         None to report.

     

    C-2

     

    

    
    


    4.20 Certain
Transactions

     

    On August 11,
2000, the Company made an interest-free relocation loan of $2,500,000 to Mr.
Peters, secured by a deed of trust on his principal residence. All outstanding
principal under the loan is due and payable on the earliest to occur of (i) July
31, 2008, (ii) 120 days following any termination of Mr. Peters’ employment with
the Company, or (iii) any sale, transfer or hypothecation of all or any part of
the property referenced in the deed of trust.

     

    The Company paid
$4.0 million, $2.2 million and $1.1 million for children’s apparel purchases at
fair market value from The Gymboree Corporation in fiscal 2003, 2002 and 2001.
Stuart G. Moldaw, a director and Chairman Emeritus of the Company, is also a
director and Chairman Emeritus of The Gymboree Corporation.

     

    C-3

     

    

    
    


    EXHIBIT
D

     

    [FORM OF OPINION
OF COUNSEL TO THE
BORROWER AFFILIATED GROUP]

     

    [L&W San
Francisco office letterhead]

     

    [March 31],
2004

     

    Fleet National
Bank, as Administrative Agent
40 Broad Street, 10th Floor
Boston,
Massachusetts 02110

     

    
      	       	Re:	       	Amended and Restated Revolving Credit Agreement
	
            	
            	
            	dated as of [March 31],
      2004


    


    Ladies and
Gentlemen:

     

         We have acted as special counsel to Ross
Stores, Inc., a Delaware corporation (the “Borrower”) in connection with that
certain Amended and Restated Revolving Credit Agreement dated as of [March 31],
2004 (the “Credit Agreement”) among the Banks, Fleet National Bank as
Administrative Agent and the Borrower.

     

         This letter is rendered to you pursuant
to Section 3.1.11 of the Credit Agreement. Capitalized terms defined in the
Credit Agreement, used herein and not otherwise defined herein, shall have the
meanings given them in the Credit Agreement.

     

         As such counsel, we have examined such
matters of fact and questions of law as we have considered appropriate for
purposes of this letter, except where a specified fact confirmation procedure is
stated to have been performed (in which case we have with your consent performed
the stated procedure), and except where a statement is qualified as to knowledge
or awareness (in which case we have with your consent made no or limited inquiry
as specified below). We have examined, among other things, the
following:

     

    
      	
            	(a)	
            	
              the Credit
      Agreement;

            
	       	
            	       	 
	
            	(b)	
            	the
      certificate of incorporation and bylaws of the Borrower (the “Governing
      Documents”); and
	
            	  
	
            	(c)	
            	(i) the
      Lease Agreement dated as of May 10, 2001 between the Borrower and BNP
      Paribas Leasing Corporation (the “Lease”), and the “Operative Documents”
      (as such term is defined in the Lease), (ii) the Senior Unsecured Delayed
      Draw Term Loan Agreement dated as of June 26, 2002 (the “Term Loan
      Agreement”) among the Borrower, Fleet National Bank, Fleet Securities,
      Inc. and the other lending institutions party thereto, and (iii) the
      Participation Agreement dated as of July 23, 2003 (the “Participation
      Agreement”) among Ross Distribution, Inc, the Borrower, Wachovia
      Development Corporation, Wachovia Bank, National Association and the
      financial institutions party thereto, and the “Operative Documents” (as
      such term is defined in the Participation Agreement) (collectively, the
      “Material Agreements”).


    

     

    D-1

     

    

    
    


         With your consent, we have relied upon
the foregoing, including the representations and warranties of the Borrower in
the Credit Agreement, and upon certificates of officer(s) of the Borrower and of
others with respect to certain factual matters. We have not independently
verified such factual matters. Whenever a statement herein is qualified by “to
our knowledge” or a similar phrase, it is intended to indicate that those
attorneys in this firm who have rendered legal services in connection with the
execution and delivery of the Credit Agreement do not have current actual
knowledge of the inaccuracy of such statement. However, except as otherwise
expressly indicated, we have not undertaken any independent investigation to
determine the accuracy of any such statement.

     

         We have assumed, with your permission and
without independent investigation, that each Bank is a commercial lender or a
financial institution which makes loans in the ordinary course of its business
and that it will make each Loan under the Credit Agreement to be made by it for
its own account in the ordinary course of its commercial banking or lending
business and not with a view to or for sale in connection with any distribution
in violation of any applicable securities laws. In addition, we have assumed
that the parties to the Credit Agreement have not entered into any agreements of
which we are unaware that modify the terms of the Credit Agreement and have not
otherwise expressly or by implication waived, or agreed to any modification of,
the Credit Agreement. We also advise you that the Borrower has informed us that
it has no court and administrative orders, writs, judgments and decrees
specifically directed to it that are material to it.

     

         We are opining herein as to the effect on
the subject transaction only of the federal laws of the United States, the
internal laws of the State of New York and with respect to our opinions set
forth in paragraphs 1 and 2 of this letter, the General Corporation Law of the
State of Delaware (the “DGCL”). We express no opinion with respect to the
applicability thereto, or the effect thereon, of the laws of any other
jurisdiction or, in the case of Delaware, any other laws, or as to any matters
of municipal law or the laws of any other local agencies within any
state.

     

    D-2

     

    

    
    


         Our opinions herein are based upon our
consideration of only those statutes, rules and regulations which, in our
experience, are normally applicable to borrowers in unsecured revolving loan
transactions, provided that no opinion is expressed as to securities laws, tax
laws, usury laws, antitrust or trade regulation laws, insolvency or fraudulent
transfer laws, antifraud laws, margin regulations, NASD rules, pension or
employee benefit laws, compliance with fiduciary duty requirements,
environmental laws, or other laws excluded by customary practice. We express no
opinion as to any state or federal laws or regulations applicable to the subject
transactions because of the legal or regulatory status or nature or extent of
the business of any parties to the Credit Agreement or of any of their
affiliates.

     

         Subject to the foregoing and the other
matters set forth herein, it is our opinion that, as of the date
hereof:

     

         1. The Borrower is a corporation and is
validly existing and in good standing under the DGCL with corporate power and
authority to own its properties and conduct its business and to enter into the
Credit Agreement and perform its obligations thereunder. Based on certificates
from public officials, we confirm that the Borrower is qualified to do business
in the following States: New York, California, Pennsylvania and South
Carolina.

     

         2. The execution, delivery and performance
of the Credit Agreement by the Borrower have been duly authorized by all
necessary corporate action of the Borrower, and the Credit Agreement has been
duly executed and delivered by the Borrower.

     

         3. The Credit Agreement constitutes a
legally valid and binding obligation of the Borrower, enforceable against the
Borrower in accordance with its terms.

     

         4. The execution and delivery of the Credit
Agreement by the Borrower and its borrowing and repayment of loans thereunder,
on the date hereof do not:

     

    
      	
            	(i)	
            	violate the
      provisions of the Borrower’s Governing Documents,
	              	
            	       	
            
	
            	(ii)	
            	to our
      knowledge, result in the breach of or a default under any of the Material
      Agreements,
	
            	 
	
            	(iii)	
            	violate any
      federal or New York statute, rule or regulation applicable to the
      Borrower, or
	
            	 
	
            	(iv)	
            	require any
      consents, approvals, authorizations to be obtained by the Borrower, or any
      registrations, declarations or filings to be made by the Borrower, under
      any federal or New York statute, rule or regulation applicable to the
      Borrower that have not been obtained or
made.


    

     

         5. The Borrower is not an “investment
company” as such term is defined in the Investment Company Act of 1940, as
amended.

     

         Latham & Watkins LLP is not
representing the Borrower in any litigation and Ken Blohm and Kevin Burnett, the
principal attorneys in this firm who have rendered legal services in connection
with the execution and delivery of the Credit Agreement, have no knowledge of
any specific litigation to which the Borrower is a party.

     

    D-3

     

    

    
    


         The opinions expressed in paragraph 3 are
further subject to the following limitations, qualifications and
exceptions:

     

         (a) the effects of bankruptcy,
insolvency, reorganization, fraudulent transfer, preference, moratorium or other
similar laws relating to or affecting the rights or remedies of
creditors;

     

         (b) the effects of general principles of
equity, whether considered in a proceeding in equity or at law (including the
possible unavailability of specific performance or injunctive relief), concepts
of materiality, reasonableness, good faith and fair dealing and the discretion
of the court before which any proceeding therefor may be brought;

     

         (c) the unenforceability under certain
circumstances under law or court decisions of provisions providing for the
indemnification of or contribution to a party with respect to a liability where
such indemnification or contribution is contrary to public policy;
and

     

         (d) we express no opinion with respect to
the enforceability of (i) consents to, or restrictions upon, judicial relief or,
except for provisions by which a party agrees to submit to the jurisdiction of
the New York courts in respect of any action or proceeding arising out of or
relating to the Credit Agreement, jurisdiction or venue; (ii) advance waivers of
claims, defenses, rights granted by law, or notice, opportunity for hearing,
evidentiary requirements, statutes of limitation, trial by jury or at law, or
other procedural rights; (iii) restrictions upon non-written modifications and
waivers; (iv) provisions authorizing or validating conclusive or discretionary
determinations; (v) grants of setoff rights; (vi) provisions to the effect that
a guarantor is liable as a primary obligor, and not as a surety; (vii)
provisions for the payment of attorneys' fees where such payment is contrary to
law or public policy; (viii) proxies, powers and trusts; (ix) provisions
prohibiting, restricting, or requiring consent to assignment or transfer of any
right or property; and (x) provisions for liquidated damages, late charges,
monetary penalties, prepayment or make-whole premiums or other economic
remedies; and (xi) provisions for default interest to the extent such default
interest is a penalty or is manifestly unreasonable.

     

         In rendering the opinions expressed in
paragraph 4 insofar as they require interpretation of the Material Agreements,
with your consent, (i) we have assumed that all courts of competent jurisdiction
would enforce such agreements in accordance with their plain meaning, (ii) to
the extent that any questions of legality or legal construction have arisen in
connection with our review, we have applied the laws of New York in resolving
such questions, although certain of the Material Agreements may be governed by
other laws, (iii) we express no opinion with respect to the effect of any
discretionary action or inaction by the Borrower under the Credit Agreement or
the Material Agreements which may result in a breach or default under any
Material Agreement, and (iv) we express no opinion with respect to any matters
which require the performance of a mathematical calculation or the making of a
financial or accounting determination. Because certain of the Material
Agreements may be governed by laws other than New York law, this letter may not
be relied upon as to whether a breach or default would occur under the law
actually governing such Material Agreements. We also note that Section 6.1(c) of
the Term Loan Agreement and Section 6.1(t)(iii) of the Participation Agreement
each permits the Borrower and its subsidiaries to incur “Indebtedness” (as
defined in each such agreement) “so long as the material terms of such
Indebtedness are no more restrictive with respect to covenants and events of
default or other material provisions than the terms and conditions set forth
herein and in the other [related] Documents.” We express no opinion as to (i)
whether the Credit Agreement satisfies this requirement of the Term Loan
Agreement and the Participation Agreement, respectively or (ii) whether the
Borrower has delivered any compliance certificates which may be required by the
Material Agreements in connection with incurrence of indebtedness under the
Credit Agreement.

     

    D-4

     

    

    
    


         With your consent, we have assumed for
purposes of this opinion that: all parties to the Credit Agreement other than
the Borrower are duly organized, validly existing and in good standing under the
laws of their respective jurisdictions of organization; all parties to the
Credit Agreement other than the Borrower have the requisite power and authority
to execute and deliver the Credit Agreement and to perform their respective
obligations under the Credit Agreement; and the Credit Agreement has been duly
authorized, executed and delivered by the parties thereto other than the
Borrower and constitute their legally valid and binding obligations, enforceable
against them in accordance with their terms.

     

         With your consent, we have further
assumed for purposes of this opinion that all parties to the Credit Agreement
other than the Borrower have complied with any applicable requirement to file
returns and pay taxes under the Franchise Tax Law of the State of California.
Failure to so be in compliance can make a contract voidable at the election of
the other party pursuant to California Revenue and Taxation Code Section
23304.1. However, under California Revenue and Taxation Code Section 23305.1, a
taxpayer may obtain relief from these voidability provisions by paying the tax
owed, along with certain penalties, and following the other procedures set out
in such section.

     

    D-5

     

    

    
    


         This letter is furnished only to you and
is solely for your benefit and the benefit of the other Banks party to the
Credit Agreement as of the date hereof in connection with the transactions
covered hereby. This letter may not be relied upon by you or such Banks for any
other purpose, or furnished to, assigned to, quoted to or relied upon by any
other person, firm or entity for any purpose, without our prior written consent,
which may be granted or withheld in our discretion. At your request, we hereby
consent to reliance hereon by any future assignee of your interest in the loans
under the Credit Agreement pursuant to an assignment that is made and consented
to in accordance with the express provisions of Section 9.10 of the Credit
Agreement, on the condition and understanding that (i) this letter speaks only
as of the date hereof, (ii) we have no responsibility or obligation to update
this letter, to consider its applicability or correctness to other than its
addressee(s), or to take into account changes in law, facts or any other
developments of which we may later become aware, and (iii) any such reliance by
a future assignee must be actual and reasonable under the circumstances existing
at the time of assignment, including any changes in law, facts or any other
developments known to or reasonably knowable by the assignee at such
time.

     

    
      	
            	
              Very truly yours,

            


    

     

    D-6

     

    

    
    


    EXHIBIT E

     

    [FORM OF REPORT
OF CHIEF FINANCIAL OFFICER]

     

    ROSS STORES,
INC.

     

    REPORT OF CHIEF
FINANCIAL OFFICER OR TREASURER

     

         Ross Stores, Inc. (the “Borrower”) HEREBY
CERTIFIES that:

     

         This Report is furnished pursuant to
Section 5.1(c) of the Amended and Restated Revolving Credit Agreement, dated as
of March 31, 2004 (as amended, modified or otherwise supplemented, the
“Agreement”), by and among the Borrower, the Banks under (and as defined in) the
Agreement, and Fleet National Bank, as administrative agent (the “Administrative
Agent”). Unless otherwise defined herein, the terms used in this Report have the
meanings given to them in the Agreement.

     

         As required by Sections 5.1[(a)] [(b)] of
the Agreement, a Consolidated balance sheet of the Borrower and its Subsidiaries
for the [year/quarter] ended ___________________, 200_ and a related
Consolidated statement of income, Consolidated statement of stockholders’ equity
and Consolidated statement of cash flows for the period then ended (the
“Financial Statements”) prepared in accordance with GAAP accompany this Report.
The Financial Statements present fairly the Consolidated financial position of
the Borrower and its Consolidated Subsidiaries as at the date thereof and the
Consolidated results of operations of the Borrower and its Consolidated
Subsidiaries for the period covered thereby (subject only to normal, recurring
year-end adjustments).

     

         The figures set forth in Schedule A for determining compliance by the
Borrower and its Consolidated Subsidiaries with the financial covenants
contained in the Agreement are true and complete as of the date
hereof.

     

         The activities of the Borrower and its
Subsidiaries during the period covered by the Financial Statements have been
reviewed by the [Chief Financial Officer] [Treasurer] or by employees or agents
under his immediate supervision. Based on such review, to the best knowledge and
belief of the [Chief Financial Officer] [Treasurer], and as of the date of this
Report, there exists no Default or Event of Default or condition which would,
with the giving of notice or the lapse of time or both, result in a Default or
an Event of Default.*

     

         WITNESS my hand this ____ day of
_____________________, 200__.

     

    
      	
            	ROSS STORES, INC.
	
            	
            	 
	 	 	  
	
            	By:	
            
	
            	
            	
               Title: [Chief Financial Officer] or
      [Treasurer]

            


    
____________________
 

    
      	*	     	
              If a
      Default or Event of Default has occurred, this paragraph is to be modified
      with an appropriate statement as to the nature thereof, the period of
      existence thereof and what action the Borrower has taken, is taking, or
      proposes to take with respect
thereto.

            


    

     

    E-1

     

    

    
    


    SCHEDULE
A
to
EXHIBIT E

     

    FINANCIAL COVENANTS

     

    As of
____________


     

    Adjusted Interest Coverage Ratio (Section
6.6)

     

    
      	
              MINIMUM:

            	
              2.0 : 1.0

            


    

     

    ACTUAL:

     

    
      	(i)	EBITDAR	       	
            	                    	     	
            	                    
	
            	(a)	EBITDA:	
            	
            	
            	
            	
            	
            
	 	 	(I)	Consolidated
      net income
(in accordance with GAAP)	
            	$	
            	
            	
            	
            
	 	 	(II)	Consolidated
      Total
Interest Expense	
            	$	
            	
            	
            	
            
	 	 	(III)	Consolidated
      income taxes	
            	$	
            	
            	
            	
            
	 	 	(IV)	Consolidated
      depreciation	
            	$	
            	
            	
            	
            
	 	 	(V)	Consolidated
      amortization	
            	$	
            	
            	
            	
            
	 	 	(VI)	Extraordinary non-cash
losses (that will not become
      cash
losses in a later fiscal period)	
            	$	
            	
            	
            	
            
	 	 	(VII)	Total
      EBITDA	
            	
            	
            	
            	
            	
            
	         	         	          	(sum of
      lines (I) through (VI)	
            	$	
            	
            	
            	
            
	 	(b)	Consolidated Rent Expense	
            	$	
            	
            	
            	
            
	 	(c)	EBITDAR (line (a)(VII) plus line (b))	
            	
            	
            	
            	$	
            
	
            	
            	 	
            	
            	
            	
            	
            	
            
	(ii)	
              Consolidated Total
      Interest Expense plus
Consolidated Rent
      Expense

            	
            	
            	
            	
            	
            	
            
	 	(a)	Consolidated Total Interest Expense	
            	$	
            	
            	
            	
            
	 	(b)	Consolidated Rent Expense	
            	$	
            	
            	
            	
            
	 	(c)	Line (a) plus line (b)	
            	
            	
            	
            	$	
            
	
            	
            	 	
            	
            	
            	
            	
            	
            
	(iii)	Line (i)(c) divided by line (ii)(c)	
            	
            	
            	
            	____ :
      1.0


    

     

    E-2

     

    

    
    


    Adjusted Debt to Total Capitalization
Ratio (Section 6.7)

     

    
      	
              MINIMUM:

            	
              75%

            
	 	
            
	
              ACTUAL:

            	
            


    


    
      	(i)	Consolidated Adjusted
Debt	 	                    	     	
            	                    
	
            	(a)	Indebtedness of Borrower	
            	
            	
            	
            	
            
	
            	
            	(on a Consolidated basis)	
            	
            	
            	
            	
            
	
            	
            	(excluding items listed in (i)(b)	
            	
            	
            	
            	
            
	
            	
            	through (i)(e) below)	$	
            	
            	
            	
            
	
            	(b)	Obligations under Capitalized Leases	$	
            	
            	
            	
            
	
            	(c)	Obligations under Synthetic Leases	$	
            	
            	
            	
            
	
            	(d)	Obligations under Guarantees	$	
            	
            	
            	
            
	
            	(e)	Obligations under Standby	
            	
            	
            	
            	
            
	
            	
            	Letters of Credit	$	
            	
            	
            	
            
	
            	(f)	6 times Consolidated Rent Expense	$	
            	
            	
            	
            
	
            	(g)	Lines (a) plus (b) plus (c)	
            	
            	
            	
            	
            
	
            	
            	plus (d) plus (e) plus (f)	
            	
            	
            	$	
            
	         	         	
            	
            	
            	
            	
            	
            
	(ii)	Stockholders’ Equity	
            	
            	
            	$	
            
	
            	 	
            	
            	
            	
            	
            
	(iii)	Consolidated Adjusted Debt (line
      (i)(g))	
            	
            	
            	
            	
            
	
            	plus Stockholders’ Equity (line
      (ii))	
            	
            	
            	$	
            
	
            	 	
            	
            	
            	
            	
            
	(iv)	Line (i)(g) divided by line (iii)
      (expressed as a
      percentage)	
            	
            	
            	____%


    


         WITNESS my hand this ___ day of
_____________________, 200__.

     

    
      	 	ROSS STORES, INC.
	
            	 
	 	 
	
            	By:	 
	
            	
            	
               Title: [Chief Financial
      Officer] or [Treasurer]

            


    

     

    E-3

     

    

    
    



    EXHIBIT F

     

    [FORM OF
ASSIGNMENT AND ASSUMPTION]

     

    ASSIGNMENT AND
ASSUMPTION

     

    Dated as of
____________


     

         Reference is made to the Amended and Restated Revolving Credit Agreement,
dated as of March 31, 2004 (as amended, modified or otherwise supplemented, the
“Agreement”), by and among Ross Stores, Inc. (the “Borrower”), the Banks under
(and as defined in) the Agreement, and Fleet National Bank, as administrative
agent (the “Administrative Agent”). Capitalized terms used herein and not
otherwise defined shall have the meanings assigned to such terms in the
Agreement.

    
    
______________________ (the “Assignor”) and ______________________ (the
“Assignee”) agree as follows:

     

         1.
The Assignor hereby sells and assigns to the Assignee, and the Assignee hereby
purchases and assumes from the Assignor, a ________% interest in and to all the
Assignor’s rights and obligations under the Agreement as of the Effective Date
(as hereinafter defined).

     

         2.
The Assignor (i) represents that it is legally authorized to enter into this
Assignment and Assumption and that, as of the date hereof, its Revolving Credit
Commitment Percentage is ___%, the aggregate outstanding balance of its
Revolving Credit Loans is $_______; (ii) makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Agreement or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of the
Agreement, the other Loan Documents or any other instrument or document
furnished pursuant thereto, other than that it is the legal and beneficial owner
of the interest being assigned by it hereunder and that such interest is free
and clear of any adverse claim; and (iii) makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower, any Guarantor, any other member of the Borrower Affiliated Group, or
any other person which may be primarily or secondarily liable in respect of any
of the Obligations or any of their respective obligations under the Agreement or
the other Loan Documents or any other instrument or document delivered or
executed pursuant thereto.

     

    F-1

     

    

    
    


         3. The Assignee (i) represents and
warrants that (a) it is an Eligible Assignee, (b) it is legally authorized to
enter into this Assignment and Assumption, (c) the execution, delivery and
performance of this Assignment and Assumption do not conflict with any provision
of law or of the charter or by-laws of the Assignee, or of any agreement binding
on the Assignee and (d) all acts, conditions and things required to be done and
performed and to have occurred prior to the execution, delivery and performance
of this Assignment and Assumption, and to render the same the legal, valid and
binding obligation of the Assignee, enforceable against it in accordance with
its terms, have been done and performed and have occurred in due and strict
compliance with all applicable laws; (ii) confirms that it has received a copy
of the Agreement, together with copies of the most recent financial statements
delivered pursuant to Sections 4.7 and 5.1 thereof and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Assumption; (iii) agrees that it
will, independently and without reliance upon the Assignor, any other Bank or
the Administrative Agent and based on such documents and information as it shall
deem appropriate at the time, continue to make its own appraisals and credit
decisions in taking or not taking action under the Agreement; (iv) appoints and
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers as are reasonably incidental thereto pursuant to the
terms of the Agreement and the other Loan Documents; and (v) agrees that it will
perform all the obligations which by the terms of the Agreement are required to
be performed by it as a Bank in accordance with the terms of the
Agreement.

     

         4.
The effective date for this Assignment and Assumption shall be _______________ (the "Effective
Date"), provided, however, that on or before such date
(i) this Assignment and Assumption shall have been executed and delivered by the
parties hereto, (ii) executed copies hereof shall have been delivered to and
consented to by the Administrative Agent and, if required, the Borrower, and
(iii) the Assignor shall have paid to the Administrative Agent the fee required
by Section 9.10(iv) of the Agreement. Following the execution of this Assignment
and Assumption and, in accordance with Section 9.10(ii) of the Agreement, the
consent thereto by the Administrative Agent and, if required, the Borrower, it
will be delivered to the Administrative Agent for acceptance and recording by
the Administrative Agent. The Administrative Agent shall maintain a copy of each
Assignment and Assumption delivered to it and a register or similar list (the
“Register”) for the recordation of the names and addresses of the Banks and the
Revolving Credit Commitment Percentages of, and principal amount of the Loans
owing to, the Banks from time to time. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Banks may treat each Person whose name is recorded
in the Register as a Bank for all purposes of the Agreement. The Register shall
be available for inspection by the Borrower and the Banks at any reasonable time
and from time to time upon reasonable prior notice.

     

         5.
Upon such acceptance and recording, from and after the Effective Date, (i) the
Assignee shall be a party to the Agreement and, to the extent provided in this
Assignment and Assumption, have the rights and obligations of a Bank thereunder,
and (ii) provided that the Administrative Agent and, if required, the Borrower
shall have approved the herein assignment pursuant to Section 9.10(ii) of the
Agreement, the Assignor shall, with respect to that portion of its interest
under the Agreement assigned hereunder, relinquish its rights and be released
from its obligations under the Agreement accruing from and after the Effective
Date; provided, however, that the Assignor shall retain its rights to be
indemnified pursuant to Section 9.3 of the Agreement with respect to any claims
or actions arising prior to the Effective Date.

     

    F-2

     

    

    
    


         6.
Upon such acceptance and recording, from and after the Effective Date, the
Administrative Agent shall make all payments in respect of the interest assigned
hereby (including payments of principal, interest, fees and other amounts) to
the Assignee. The Assignor and Assignee shall make all appropriate adjustments
directly between themselves with respect to payments by the Administrative Agent
for periods prior to the Effective Date or otherwise with respect to the making
of this assignment.

     

         7.
THIS ASSIGNMENT AND ASSUMPTION IS INTENDED TO BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT REFERENCE TO
CONFLICT OF LAWS).

     

         8. This Assignment and Assumption may be
signed in any number of counterparts with the same effect as if the signatures
hereto and thereto were upon the same instrument.

     

    [signatures on
next page]

     

    F-3

     

    

    
    


         IN
WITNESS WHEREOF, intending to be legally bound, each of the undersigned has
caused this Assignment and Assumption to be executed on its behalf by its
officer thereunto duly authorized, as of the date first above
written.

     

    
      	The
      Assignor:
	 
	[___________________________________]	              
    
	
            	
            	 	
            
	 	
            	
            	
            
	By:	
            	
            	
            
	Title: 	
            	
            	
            
	
            	
            	 	
            
	
            	
            	 	
            
	
              The Assignee:

               

            
	
            
	[___________________________________]	 
	
            	
            	 	
            
	By:	
            	
            	
            
	Title: 	
            	
            	
            
	
            	
            	 	
            
	
            	
            	 	
            
	Notice
      Address of Assignee:
	 
	 	
            	 	
            
	 	
            	 	
            
	 	
            	 	
            
	
              Attn: 
      

            	
            	
            
	
            	
            	 	
            
	
              Wire
      Instructions for Assignee:

               

            
	
            	
            	 	
            
	
            	
            	 	
            
	
            	
            	 	
            


    

    
    

     

    F-4

     

    

    
    


    
      	CONSENTED TO:	
            
	
            	 	
            
	The Administrative
      Agent	 
	 	
            
	FLEET NATIONAL BANK	
            
	 	
            
	 	
            
	 	
            
	By:	 	
            
	Title:	 	
            
	 	
            	
            
	 	
            	
            
	The Borrower:	 
	  	
            
	ROSS STORES, INC.	
            
	 	
            	
            
	 	
            	
            
	 	
            	
            
	By:	
            	
            
	Title:	
            	
            


    


    F-5

     

    

    
    


    EXHIBIT G

     

    [FORM OF
SUBSIDIARY GUARANTEE]
 

     

    SUBSIDIARY
GUARANTEE

     

         This SUBSIDIARY GUARANTEE (“Guarantee”), dated as of __________, by
_____________, a ____________ corporation (the “Guarantor”) and a wholly-owned
subsidiary of Ross Stores, Inc. (the “Borrower”), is in favor of Fleet National
Bank, a national banking association, as administrative agent (the
“Administrative Agent”) for itself and for the ratable benefit of the other
lending institutions (collectively, the “Banks”) which are or may become parties
to the Amended and Restated Revolving Credit Agreement dated as of March 31,
2004 (as from time to time amended, modified or otherwise supplemented and in
effect, the “Loan Agreement”) by and among the Borrower, the Banks and the
Administrative Agent. Capitalized terms used herein and defined in the Loan
Agreement, but not defined herein, are used with the meanings ascribed to such
terms in the Loan Agreement.

     

        
WHEREAS, the Borrower has requested the Banks and the Administrative
Agent to enter into the Loan Agreement pursuant to which the Banks will make
loans and extend credit to the Borrower upon the terms and subject to the
conditions set forth therein;

     

        
WHEREAS, the Borrower and the Guarantor are members of a group of related
corporations, the success of any one of which is dependent in part on the
success of the other members of such group;

     

        
WHEREAS, the Guarantor expects to receive substantial direct benefits
from the making of loans and extensions of credit to the Borrower by the Banks
pursuant to the Loan Agreement (which benefits are hereby
acknowledged);

     

        
WHEREAS, the Banks and the Administrative Agent are unwilling to enter
into the Loan Agreement and to make any loans or to extend any credit thereunder
unless the Guarantor shall execute and deliver to the Administrative Agent, for
the benefit of the Banks and the Administrative Agent, a guarantee substantially
in the form hereof; and

     

        
WHEREAS, the Guarantor wishes to guarantee the Borrower’s obligations to
the Banks and the Administrative Agent under or in respect of the Loan Agreement
as provided herein;

     

         NOW,
THEREFORE, the Guarantor hereby agrees with the Banks and the Administrative
Agent as follows:

     

    G-1

     

    

    
    


        
1. Guarantee of Payment and Performance of
Obligations. In
consideration of the Banks’ extending credit or otherwise giving financial or
banking facilities or accommodations to the Borrower, the Guarantor hereby
unconditionally guarantees to the Administrative Agent and each Bank the due and
punctual payment or performance of, at the place specified therefor, or if no
place is specified, at the Administrative Agent’s head office at 100 Federal
Street, Boston, Massachusetts 02110, (i) all Obligations under the Loan
Agreement; and (ii) without limitation of the foregoing, all reasonable fees,
costs and expenses incurred by the Administrative Agent or the Banks in
attempting to collect or enforce any of the foregoing during the existence of an
Event of Default (including without limitation the reasonable fees, costs and
expenses of outside counsel and the allocated costs of in-house counsel),
accrued in each case to the date of payment hereunder, whether before or after
judgment, together with (iii) interest on all Obligations under the Loan
Agreement from the time when such amounts become due until payment, whether
before or after judgment, at the rate of interest set forth in Section 2.15 of
the Loan Agreement, provided that if such interest exceeds the maximum
amount permitted to be paid under applicable law, then such interest shall be
reduced to such maximum permitted amount (collectively the “Guaranteed
Obligations” and each individually a “Guaranteed Obligation”). The Guaranteed
Obligations shall include, without limitation, (x) all Obligations that would
become due but for the operation of the automatic stay pursuant to Section
362(a) of the United States Code and the operation of Sections 502(b) and 506(b)
of the United States Code and (y) any interest accruing after the commencement
of Insolvency proceedings with respect to the Borrower regardless of whether
such interest is allowed by the court having jurisdiction over such proceedings.
This Guarantee is an absolute, unconditional and continuing guarantee of the
full and punctual payment and performance of the Guaranteed Obligations and not
of their collectibility only and is in no way conditioned upon any requirement
that the Administrative Agent or any Bank first attempt to collect any of the
Guaranteed Obligations from the Borrower or resort to any security or other
means of obtaining payment of any of the Guaranteed Obligations which the
Administrative Agent or any Bank now has or may acquire after the date hereof or
upon any other contingency whatsoever. Upon the occurrence and continuance of an
Event of Default under the Loan Agreement, such Guaranteed Obligations shall, at
the option of the Administrative Agent, become forthwith due and payable to the
Administrative Agent for the account of the Bank or Banks owed the same without
demand or notice of any nature, all of which are expressly waived by the
Guarantor. Payments by the Guarantor hereunder may be required by the
Administrative Agent on any number of occasions.

     

        
2. Payments. All payments by the Guarantor hereunder
shall be made to the Administrative Agent, in the manner and at the place of payment specified
therefor in the Loan Agreement, for the account of the Banks and the
Administrative Agent. Without limiting the generality of the foregoing, the
Guarantor’s obligations hereunder with respect to any Guaranteed Obligation
shall not be discharged by a payment in a currency other than the currency in
which the Guaranteed Obligation is denominated (the “Obligation Currency”) or at
a place other than the place specified for the payment of the Guaranteed
Obligation, whether pursuant to a judgment or otherwise, to the extent that
the amount so paid on conversion to
the Obligation Currency and transferred to Boston, Massachusetts, U.S.A. under
normal banking procedures does not yield the amount of Obligation Currency due
thereunder.

     

    G-2

     

    

    
    


        
3. Taxes. All payments hereunder shall be made
free and clear of, and without reduction by reason of, any Covered Taxes which
are now or may hereafter be imposed, levied or assessed by any country,
political subdivision or taxing authority on payments hereunder, or other
payments unless required by law, and without setoff, recoupment or counterclaim,
all of which will be for the account of and paid by the Guarantor. If for any
reason any such reduction is made or any Covered Taxes are paid by the
Administrative Agent or any Bank, the Guarantor will pay to the Administrative
Agent for the account of the Administrative Agent or such Bank such additional
amounts as may be necessary to ensure that the Administrative Agent or such Bank
receives the same net amount which it would have received had no reduction been
made or Covered Taxes paid.

     

        
4. Administrative Agent; Application of
Funds. This Guarantee
has been delivered to the Administrative Agent and the Administrative Agent has
been authorized to enforce this Guarantee on behalf of each of the Banks
pursuant to the Loan Documents. All payments by the undersigned pursuant to this
Guarantee shall be made to the Administrative Agent for the ratable benefit of
the Banks and the Administrative Agent and, after the payment of all reasonable
expenses as provided in this Guarantee and the Loan Agreement, shall be applied
to the payment of the Guaranteed Obligations until the same are paid in
full.

     

        
5. Unlimited Liability of
Guarantor. The
liability of the Guarantor hereunder shall be unlimited and, as to the
Guaranteed Obligations, shall be joint and several with the liability of each
other party who has guaranteed or who will guarantee all or any part of the
Guaranteed Obligations. The Administrative Agent shall have the absolute right
to enforce the liability of the Guarantor hereunder without resort to any other
right or remedy including any right or remedy under any other guarantee, and the
release or discharge of any guarantor of all or any part of the Guaranteed
Obligations shall not affect the continuing liability of the Guarantor
hereunder.

     

        
6. Effectiveness; Release. The obligations of the Guarantor under
this Guarantee shall continue in full force and effect and shall remain in
operation until all of the Obligations shall have been paid in full in cash, and
shall continue to be effective or be reinstated, as the case may be, if at any
time payment of any of the Obligations (or Guaranteed Obligations) is rescinded
or must otherwise be restored or returned upon the bankruptcy, insolvency, or
reorganization of the Borrower, or otherwise, as though such payment had not
been made or other satisfaction occurred. No invalidity, irregularity or
unenforceability by reason of applicable bankruptcy laws, or any other similar
law, or any law or order of any government or agency thereof purporting to
reduce, amend or otherwise affect, the Guaranteed Obligations, shall impair,
affect, be a defense to or claim against the obligations of the Guarantor under
this Guarantee. This Agreement shall become effective as to the Guarantor when a
counterpart hereof executed on behalf of the Guarantor shall have been delivered to
the Administrative Agent and thereafter shall be binding upon the Guarantor and
its successors and assigns, and shall inure to the benefit of the Administrative
Agent and the Banks, and their respective successors and assigns, except that
the Guarantor shall not have the right to assign its rights or obligations
hereunder or any interest herein (and any such attempted assignment shall be
void).

     

    G-3

     

    

    
    


        
7. Set-off. Regardless of the adequacy of any
collateral or other means of obtaining repayment of the Guaranteed Obligations,
if an Event of Default shall have occurred and be continuing, the Administrative
Agent and each Bank may at any time and from time to time, without notice to the
Guarantor, set off the whole or any portion or portions of any or all deposits
and other sums credited by or due from the Administrative Agent or such Bank to
the Guarantor or subject to withdrawal by the Guarantor against amounts payable
under this Guarantee, whether or not any other person or persons could also
withdraw money therefrom.

     

        
8. Unenforceability of Obligations Against
Borrower; Invalidity of Security or Other Guaranties. If for any reason the Borrower has no
legal existence or is under no legal obligation to discharge any of the
Guaranteed Obligations, or if any of the monies included in the Guaranteed
Obligations have become irrecoverable from the Borrower by operation of law or
for any other reason, this Guarantee shall nevertheless be binding on the
Guarantor to the same extent as if the Guarantor at all times had been the
principal debtor on all such Guaranteed Obligations. In the event that
acceleration of the time for payment of any of the Guaranteed Obligations is
stayed upon the insolvency, bankruptcy or reorganization of the Borrower, or for
any other reason, all such amounts otherwise subject to acceleration under the
terms of the Loan Agreement, the other Loan Documents or any other agreement
evidencing, securing or otherwise executed in connection with any Guaranteed
Obligation shall be immediately due and payable by the Guarantor. This Guarantee
shall be in addition to any other guarantee or other security for the Guaranteed
Obligations, and it shall not be prejudiced or rendered unenforceable by the
invalidity of any such other guarantee or security.

     

        
9. No Fraudulent
Conveyance.
Notwithstanding any provision of this Guarantee to the contrary, it is intended
that this Guarantee, and any liens and security interests that may hereafter be
granted by the Guarantor to secure this Guarantee, not constitute a “Fraudulent
Conveyance” (as defined below). Consequently, the Guarantor agrees that if this
Guarantee, or any liens or security interests hereafter securing this Guarantee,
would, but for the application of this sentence, constitute a Fraudulent
Conveyance, this Guarantee and each such lien and security interest shall be
valid and enforceable only to the maximum extent that would not cause this
Guarantee or such lien or security interest to constitute a Fraudulent
Conveyance, and this Guarantee shall automatically be deemed to have been
amended accordingly at all relevant times. For purposes hereof, “Fraudulent Conveyance” means a
fraudulent conveyance under Section 548 of the United States Bankruptcy Code or
a fraudulent conveyance or fraudulent transfer under the provisions of any
applicable fraudulent conveyance or fraudulent transfer law or similar law of
any state, nation or other governmental unit, as in effect from time to
time.

     

    G-4

     

    

    
    


        
10. Representations, Warranties and
Covenants. The
Guarantor hereby represents, warrants, and covenants to and with the
Administrative Agent that:

     

             
10.1. Corporate Status. The Guarantor is a Person duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, and has the power and authority to own its
property, conduct its business as now being conducted and to make and perform
this Guarantee and the transactions contemplated hereby, and is duly qualified
to do business and is in good standing as a foreign corporation, limited
liability company or other entity in each jurisdiction where the nature and
extent of the business conducted by it, or property owned by it, and applicable
law require such qualification, except where the failure to be so qualified
would not reasonably be expected to result in a Material Adverse Effect. The
Guarantor is, and shall at all times be, a direct or indirect wholly-owned
Subsidiary of the Borrower.

     

             
10.2. Authorization. The execution, delivery and performance
of this Guarantee have been duly authorized by all necessary action and will not
(a) require any consent or approval of any creditors, trustees for creditors or
shareholders of the Guarantor, (b) contravene any provision of the charter or
other formation documents, by-laws or other governing documents, of the
Guarantor or any law, rule or regulation applicable to it, (c) contravene any
provision of, or constitute an event of default or event that, but for the
requirement that time elapse or notice be given, or both, would constitute an
event of default under, any other agreement, instrument, order or undertaking
binding on the Guarantor, or (d) result in or require the imposition of any
Encumbrance on any of the properties, assets or rights of the
Guarantor.

     

             
10.3. Litigation. Except as disclosed to the
Administrative Agent in writing prior to the execution hereof, no action, suit,
investigation or proceeding is pending or known to be threatened against or
affecting the Guarantor which, if adversely determined, would reasonably be
expected to result in a Material Adverse Effect.

     

             
10.4. Absence of Default. The Guarantor is not in default under
any provision of its charter or other formation documents, bylaws or other
governing documents, any amendment of any thereof or of any material indenture
relating to borrowed money or of any contract to which it is a party or by which
it is bound or of any order, regulation, ruling or requirement of a court or
regulatory authority by which it is bound except for defaults that individually
or in the aggregate would not reasonably be expected to have a Material Adverse
Effect.

     

             
10.5. No Consents Required. No license, consent or approval of, or
filing with, any governmental body or other regulatory authority is required for
the making and performance of this Guarantee. The Guarantor holds all
certificates and authorizations of all governmental agencies and authorities
required by law to enable it to engage in the business currently transacted by
it, except where the failure to hold any such certificate or authorization would
not reasonably be expected to have a Material Adverse Effect.

     

    G-5

     

    

    
    


             
10.6. Survival of Representations and
Warranties. All
representations and warranties made herein shall survive until the Obligations
are paid in full in cash.

     

             
10.7. Covenants. (a) The Guarantor will not at any time
after the date of this Guarantee create, assume, incur, or permit to exist, any
Encumbrance in respect of any of its property, assets, income or revenues of any
character, whether heretofore or hereafter acquired by it, except Permitted
Encumbrances. (b) The Guarantor will give prompt notice to the Administrative
Agent of any amendment to its charter or other formation documents, by-laws or
other governing documents.

     

        
11. Waivers by Guarantor; Banks’ Freedom to
Act. To the fullest
extent permitted by applicable law, the Guarantor agrees that the Guaranteed
Obligations will be paid and performed strictly in accordance with their
respective terms, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the
Administrative Agent or any Bank with respect thereto. To the fullest extent
permitted by applicable law, the Guarantor waives promptness, diligences,
presentment, demand, protest, notice of acceptance, notice of any Guaranteed
Obligations incurred and all other notices of any kind, all defenses which may
be available by virtue of any valuation, stay, moratorium law or other similar
law now or hereafter in effect, any right to require the marshalling of assets
of the Borrower or any other entity or other person primarily or secondarily
liable with respect to any of the Guaranteed Obligations, and all suretyship
defenses generally. The Administrative Agent and each Bank shall be at liberty,
without giving notice to or obtaining the assent of the Guarantor and without
relieving the Guarantor of any liability hereunder, to deal with the Borrower
and with each other party who now is or after the date hereof becomes liable in
any manner for any of the Guaranteed Obligations, in such manner as the
Administrative Agent or such Bank in its sole discretion deems fit. Without
limiting the generality of the foregoing, the Guarantor agrees to the provisions
of any instrument evidencing, securing or otherwise executed in connection with
any Guaranteed Obligation and agrees that the obligations of the Guarantor
hereunder shall not be released or discharged, in whole or in part, or otherwise
affected by (a) the failure of the Administrative Agent or any Bank to assert
any claim or demand or to enforce any right or remedy against the Borrower or
any other entity or other person primarily or secondarily liable with respect to
any of the Guaranteed Obligations; (b) any extensions, compromise, refinancing,
consolidation or renewals of any Guaranteed Obligation; (c) any change in the
time, place or manner of payment of any of the Guaranteed Obligations or any
rescissions, waivers, compromise, refinancing, consolidation or other amendments
or modifications of any of the terms or provisions of the Loan Agreement, the
other Loan Documents or any other agreement evidencing, securing or otherwise
executed in connection with any of the Guaranteed Obligations; (d) the addition,
substitution or release of any entity or other person primarily or secondarily
liable for any Guaranteed Obligation; (e) the adequacy of any rights which the
Administrative Agent or any Bank may have against any collateral security or
other means of obtaining repayment of any of the Guaranteed Obligations; (f) the
impairment of any future collateral securing any of the Guaranteed Obligations,
including without limitation the failure to perfect, preserve or enforce any
rights which the Administrative Agent or any Bank might have in such collateral
security or the substitution,
exchange, surrender, release, loss or destruction of any such collateral
security; or (g) any other act or omission which might in any manner or to any
extent vary the risk of the Guarantor or otherwise operate as a release or
discharge of the Guarantor, all of which may be done without notice to or
consent of the Guarantor. To the fullest extent permitted by law, the Guarantor
hereby expressly waives any and all rights or defenses arising by reason of (i)
any “one action” or “anti-deficiency” law which would otherwise prevent the
Administrative Agent or any Bank from bringing any action, including any claim
for a deficiency, or exercising any other right or remedy (including any right
of set-off), against the Guarantor before or after the Administrative Agent’s or
such Bank’s commencement or completion of any foreclosure action, whether
judicially, by exercise of power of sale or otherwise, or (ii) any other law
which in any other way would otherwise require any election of remedies by the
Administrative Agent or any Bank.

     

    G-6

     

    

    
    


        
12. No Contest with Administrative Agent or
Banks. So long as any
Obligation remains unpaid or undischarged, the Guarantor will not, as a result
of paying any sum recoverable hereunder (whether or not demanded by the
Administrative Agent or the Banks or any of them) or by any means or on any
other ground, exercise any rights against the Borrower or claim any set-off or
counterclaim against the Borrower in respect of any liability of the Guarantor
to the Borrower or seek contribution from any other guarantor or, in proceedings
under applicable bankruptcy laws or insolvency proceedings of any nature, prove
in competition with the Administrative Agent or any Bank in respect of any
payment hereunder or be entitled to have the benefit of any counterclaim or
proof of claim or dividend or payment by or on behalf of the Borrower or the
benefit of any other security for any Guaranteed Obligation which, now or
hereafter, the Administrative Agent or any Bank may hold or in which it may have
any share. The Guarantor waives any benefit of and any right to participate in
any collateral which may be held in the future by the Administrative Agent or
any Bank. The payment of any amounts due with respect to any indebtedness of the
Borrower now or hereafter held by the Guarantor which arises as a result of the
Guarantor’s payment of any sum recoverable hereunder is hereby subordinated to
the payment in full of the Guaranteed Obligations. The Guarantor agrees that
after the occurrence and continuance of any Event of Default in the payment or
performance of the Guaranteed Obligations, the Guarantor will not demand, sue
for or otherwise attempt to collect any such indebtedness of the Borrower to the
Guarantor until the Obligations shall have been paid in full. If,
notwithstanding the foregoing sentence, the Guarantor shall collect, enforce or
receive any amounts in respect of such indebtedness, such amounts shall be
collected, enforced and received by the Guarantor as trustee for the
Administrative Agent and be paid over to the Administrative Agent on account of
the Guaranteed Obligations without affecting in any manner the liability of the
Guarantor under the other provisions of this Guarantee. The provisions of this
Section 12 shall be supplemental to and not in derogation of any rights and
remedies of the Banks and the Administrative Agent under any separate
subordination agreement which the Administrative Agent may at any time and from
time to time enter into with the Guarantor or any other guarantor for the
benefit of the Banks and the Administrative Agent.

     

    G-7

     

    

    
    


        
13. Financial Condition of Borrower and
Others. The Guarantor
hereby assumes full responsibility for keeping itself informed of the financial
condition of the Borrower, and any and all endorsers and other guarantors of any
Loan Document and of all other circumstances bearing upon the risk of nonpayment
of the Guaranteed Obligations, or any part thereof, and the Guarantor hereby
agrees that neither the Administrative Agent nor any Bank has any duty to advise
the Guarantor of information known to the Administrative Agent or such Bank
regarding such condition or any such circumstances. The Guarantor hereby
acknowledges familiarity with the Borrower’s financial condition and has not
relied on any statements by the Administrative Agent or any Bank in obtaining
such information. In the event that the Administrative Agent or any Bank, in its
sole discretion, undertakes at any time or from time to time to provide any such
information to the Guarantor, neither the Administrative Agent nor such Bank
shall be under any obligation (i) to undertake any investigation with respect
thereto, (ii) to disclose any information which, pursuant to accepted or
reasonable commercial finance practices, the Administrative Agent or such Bank
wishes to maintain confidential or (iii) to make any other or future disclosures
of such information, or any other information, to the Guarantor.

     

        
14. Demands and Notices. Any demand to the Guarantor, and any
notice to the Guarantor or the Administrative Agent, shall be in writing and
shall be deemed to have been given (i) when delivered by hand, (ii) when sent by
electronic facsimile transmission with confirmation of receipt if sent prior to
5:00 p.m. of the recipient’s prevailing time, and otherwise deemed to have been
given on the next Business Day, (iii) three (3) Business Days after being sent
certified mail, return receipt requested, and properly deposited in the mails,
postage prepaid, or (iv) one (1) Business Day after being delivered to an
overnight courier, addressed to such party at its address set forth on the
signature page hereto (as to the Guarantor) or the address specified in the Loan
Agreement (as to the Administrative Agent) or at any other address specified by
the Guarantor or the Administrative Agent to the other in writing.
Notwithstanding the foregoing, the Administrative Agent and the Banks shall have
been deemed for all purposes to have delivered any notice required to be
delivered to the Guarantor by this Agreement or otherwise, by sending such
notification to the address set forth in the Loan Agreement for the
“Borrower.”

     

        
15. Amendments, Waivers,
Etc. No provision of
this Guarantee can be changed, waived, discharged or terminated except by an
instrument in writing signed by the Administrative Agent and the Guarantor
expressly referring to the provision of this Guarantee to which such instrument
relates; and no such waiver shall extend to, affect or impair any right with
respect to any obligation which is not expressly dealt with therein. No course
of dealing or delay or omission on the part of the Administrative Agent or the
Banks or any of them in exercising any right shall operate as a waiver thereof
or otherwise be prejudicial thereto.

     

        
16. Further Assurances. The Guarantor at its sole cost and
expense agrees to do all such things and execute, acknowledge and deliver all
such documents and instruments as the Administrative Agent from time to time may
reasonably request in order to give full effect to this Guarantee.

     

    G-8

     

    

    
    


        
17. Successors and Assigns. This Guarantee shall be binding upon
the Guarantor and its successors and assigns, and shall inure to the benefit of
the Administrative Agent and the Banks and their respective successors,
transferees and assigns. Without limiting the generality of the foregoing
sentence, each Bank may assign or otherwise transfer the Loan Agreement, the
other Loan Documents or any other agreement or note held by it evidencing,
securing or otherwise executed in connection with the Guaranteed Obligations, or
sell participations in any interest therein, to any other entity or other
person, and such other entity or other person shall thereupon become vested, to
the extent set forth in the agreement evidencing such assignment, transfer or
participation, with all the rights in respect thereof granted to such Bank
herein, all in accordance with Section 9.10 of the Loan Agreement. The Guarantor
may not assign any of its obligations hereunder.

     

        
18. Governing Law; Consent to
Jurisdiction.
THIS GUARANTEE AND ALL RIGHTS AND
OBLIGATIONS HEREUNDER, INCLUDING MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS). The
Guarantor agrees that any suit for the enforcement of this Agreement may be
brought in (i) the courts of the State of New York, or any federal court sitting
in New York County in said state, and (ii) any appellate court to which appeals
may be taken from any of the courts referred to in clause (i), and consents to
the non-exclusive jurisdiction of such court and to service of process in any
such suit being made upon the Guarantor by mail at the address specified on the
signature page hereof. The Guarantor hereby waives any objection that it may now
or hereafter have to the venue of any such suit or any such court or that such
suit is brought in an inconvenient court. Anything hereinbefore to the contrary
notwithstanding, the Administrative Agent or any Bank may sue the Guarantor in
the courts of any other country, State of the United States or place where the
Guarantor or any of the property or assets of the Guarantor may be found or in
any other appropriate jurisdictions.

     

        
19. WAIVER OF JURY TRIAL. THE GUARANTOR HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON,
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTEE OR ANY OTHER LOAN
DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH OR ANY COURSE OF
CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS
OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE
ADMINISTRATIVE AGENT AND THE BANKS TO MAKE LOANS AND EXTEND CREDIT TO THE
BORROWER.

     

    G-9

     

    

    
    


        
20. Miscellaneous
Provisions. This Guarantee constitutes the entire agreement of the Guarantor with
respect to the matters set forth herein. The rights and remedies herein provided
are cumulative and not exclusive of any remedies provided by law or any other
agreement, and this Guarantee shall be in addition to any other guarantee
of or collateral security for any of the Guaranteed Obligations. The invalidity
or unenforceability of any one or more provisions of this Guarantee shall not
affect the validity or enforceability of its remaining provisions. Captions are
for ease of reference only and shall not affect the meaning of the relevant
provisions. The meanings of all terms used in this Guarantee shall be equally
applicable to the singular and plural forms of such terms.

     

    (Signature on
next page)

     

    G-10

     

    

    
    


         IN
WITNESS WHEREOF, the undersigned Guarantor has caused this Guarantee to be
executed by its duly authorized officer, all as of the date first above
written.

     

    
      	[INSERT NAME OF
  GUARANTOR]
	 
	 
	By:	 
	 	     Name:
	 	     Title:




      
        	Address of Guarantor for
      Notice:
	  
	 
	 
	 
	Attn:	  
	 


      

    

    
      	Fax
      No.:	 


    


    G-11