exv4w21






Exhibit 4.21




$45,000,000 REVOLVING CREDIT FACILITY




CREDIT AGREEMENT



by and among



MAFCO WORLDWIDE CORPORATION,



THE LENDERS PARTY HERETO


and



PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent



 




PNC CAPITAL MARKETS LLC, as Lead Arranger



Dated as of December 15, 2010



 









 





TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	1. CERTAIN DEFINITIONS
	 	 	1	 
	1.1 Certain Definitions
	 	 	1	 
	1.2 Construction
	 	 	24	 
	1.3 Accounting Principles
	 	 	25	 
	 
	 	 	 	 
	2. REVOLVING CREDIT AND SWING LOAN FACILITIES
	 	 	25	 
	2.1 Revolving Credit Commitments
	 	 	25	 
	2.1.1 Revolving Credit Loans
	 	 	25	 
	2.1.2 Swing Loan Commitment
	 	 	25	 
	2.2 Nature of Lenders’ Obligations with Respect to Revolving Credit Loans
	 	 	26	 
	2.3 Commitment Fees
	 	 	26	 
	2.4 Revolving Credit Loan Requests; Swing Loan Requests
	 	 	26	 
	2.4.1 Revolving Credit Loan Requests
	 	 	26	 
	2.4.2 Swing Loan Requests
	 	 	27	 
	2.5 Making Revolving Credit Loans and Swing Loans; Presumptions by the
Administrative Agent; Repayment of Revolving Credit   Loans; Borrowings to Repay
Swing Loans
	 	 	27	 
	2.5.1 Making Revolving Credit Loans
	 	 	27	 
	2.5.2 Presumptions by the Administrative Agent
	 	 	28	 
	2.5.3 Making Swing Loans
	 	 	28	 
	2.5.4 Repayment of Revolving Credit Loans
	 	 	28	 
	2.5.5 Borrowings to Repay Swing Loans
	 	 	28	 
	2.6 Notes
	 	 	29	 
	2.7 Use of Proceeds
	 	 	29	 
	2.8 Letter of Credit Subfacility
	 	 	29	 
	2.8.1 Issuance of Letters of Credit
	 	 	29	 
	2.8.2 Letter of Credit Fees
	 	 	30	 
	2.8.3 Disbursements, Reimbursement
	 	 	30	 
	2.8.4 Repayment of Participation Advances
	 	 	31	 
	2.8.5 Documentation
	 	 	32	 
	2.8.6 Determinations to Honor Drawing Requests
	 	 	32	 
	2.8.7 Nature of Participation and Reimbursement Obligations
	 	 	32	 
	2.8.8 Indemnity
	 	 	34	 
	2.8.9 Liability for Acts and Omissions
	 	 	34	 
	2.8.10 Issuing Lender Reporting Requirements
	 	 	35	 
	2.8.11 Reduction of Revolving Credit Commitment
	 	 	35	 
	2.8.12 Commercial Letters of Credit
	 	 	36	 
	2.8.13 Defaulting Lenders
	 	 	36	 
	 
	 	 	 	 
	3. INTEREST RATES
	 	 	38	 
	3.1 Interest Rate Options
	 	 	38	 
	3.1.1 Revolving Credit Interest Rate Options; Swing Line Interest Rate
	 	 	39	 






i









 






	 	 	 	 	 
	 	 	Page	 
	3.1.2 Rate Quotations
	 	 	39	 
	3.2 Interest Periods
	 	 	39	 
	3.2.1 Amount of Borrowing Tranche
	 	 	39	 
	3.2.2 Renewals
	 	 	39	 
	3.3 Interest After Default
	 	 	40	 
	3.3.1 Interest Rate
	 	 	40	 
	3.3.2 Letter of Credit Fees and Other Obligations
	 	 	40	 
	3.3.3 Acknowledgment; Payable on Demand
	 	 	40	 
	3.4 LIBOR Rate Unascertainable; Illegality; Increased Costs; Deposits Not
Available
	 	 	40	 
	3.4.1 Unascertainable
	 	 	40	 
	3.4.2 Illegality; Increased Costs; Deposits Not Available
	 	 	40	 
	3.4.3 Administrative Agent’s and Lender’s Rights
	 	 	41	 
	3.5 Selection of Interest Rate Options
	 	 	41	 
	 
	4. PAYMENTS
	 	 	42	 
	4.1 Payments
	 	 	42	 
	4.2 Pro Rata Treatment of Lenders
	 	 	42	 
	4.3 Sharing of Payments by Lenders
	 	 	42	 
	4.4 Presumptions by Administrative Agent
	 	 	43	 
	4.5 Interest Payment Dates
	 	 	44	 
	4.6 Voluntary Prepayments
	 	 	44	 
	4.6.1 Right to Prepay
	 	 	44	 
	4.6.2 Replacement of a Lender
	 	 	45	 
	4.7 Increased Costs
	 	 	45	 
	4.7.1 Increased Costs Generally
	 	 	45	 
	4.7.2 Capital Requirements
	 	 	46	 
	4.7.3 Certificates for Reimbursement; Repayment of
Outstanding Loans; Borrowing of New Loans
	 	 	46	 
	4.7.4 Delay in Requests
	 	 	47	 
	4.8 Taxes
	 	 	47	 
	4.8.1 Payments Free of Taxes
	 	 	47	 
	4.8.2 Payment of Other Taxes by the Borrower
	 	 	47	 
	4.8.3 Indemnification by the Borrower
	 	 	47	 
	4.8.4 Evidence of Payments
	 	 	48	 
	4.8.5 Status of Lenders
	 	 	48	 
	4.8.6 Treatment of Certain Refunds
	 	 	49	 
	4.9 Indemnity
	 	 	50	 
	4.10 Settlement Date Procedures
	 	 	50	 
	 
	 	 	 	 
	5. REPRESENTATIONS AND WARRANTIES
	 	 	51	 
	5.1 Representations and Warranties
	 	 	51	 
	5.1.1 Financial Condition
	 	 	51	 
	5.1.2 No Change
	 	 	52	 
	5.1.3 Existence; Compliance with Law
	 	 	52	 
	5.1.4 Power; Authorization; Enforceable Obligations
	 	 	52	 






ii









 






	 	 	 	 	 
	 	 	Page	 
	5.1.5 No Legal Bar
	 	 	52	 
	5.1.6 Litigation
	 	 	52	 
	5.1.7 No Default
	 	 	53	 
	5.1.8 Ownership of Property; Liens
	 	 	53	 
	5.1.9 Intellectual Property
	 	 	53	 
	5.1.10 Taxes
	 	 	53	 
	5.1.11 Federal Regulations
	 	 	53	 
	5.1.12 Labor Matters
	 	 	53	 
	5.1.13 Investment Company Act; Other Regulations
	 	 	54	 
	5.1.14 Subsidiaries
	 	 	54	 
	5.1.15 Environmental Matters
	 	 	54	 
	5.1.16 Accuracy of Information, etc.
	 	 	55	 
	5.1.17 Security Documents
	 	 	55	 
	5.1.18 Solvency
	 	 	56	 
	5.1.19 ERISA Compliance
	 	 	56	 
	 
	 	 	 	 
	6. CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT
	 	 	56	 
	6.1 First Loans and Letters of Credit
	 	 	57	 
	6.1.1 Deliveries
	 	 	57	 
	6.2 Each Loan or Letter of Credit
	 	 	58	 
	 
	 	 	 	 
	7. COVENANTS
	 	 	59	 
	7.1 Affirmative Covenants
	 	 	59	 
	7.1.1 Financial Statements
	 	 	59	 
	7.1.2 Certificates; Other Information
	 	 	60	 
	7.1.3 Payment of Obligations
	 	 	60	 
	7.1.4 Maintenance of Existence; Compliance
	 	 	61	 
	7.1.5 Maintenance of Property; Insurance
	 	 	61	 
	7.1.6 Inspection of Property; Books and Records; Discussions
	 	 	61	 
	7.1.7 Notices
	 	 	61	 
	7.1.8 Environmental Laws
	 	 	62	 
	7.1.9 Additional Collateral, etc.
	 	 	62	 
	7.1.10 Intentionally Omitted
	 	 	64	 
	7.1.11 Further Assurances
	 	 	64	 
	7.1.12 Anti-Terrorism Laws
	 	 	64	 
	7.1.13 Operating Accounts
	 	 	64	 
	7.2 Negative Covenants
	 	 	65	 
	7.2.1 Financial Covenants
	 	 	65	 
	7.2.2 Limitation on Liens
	 	 	65	 
	7.2.3 Limitation on Guarantee Obligations
	 	 	67	 
	7.2.4 Limitation on Fundamental Changes
	 	 	68	 
	7.2.5 Limitation on Sale of Assets
	 	 	68	 
	7.2.6 Limitation on Restricted Payments
	 	 	69	 
	7.2.7 Limitation on Investments, Loans, Advances and Acquisitions
	 	 	70	 
	7.2.8 Sale and Leaseback
	 	 	71	 
	7.2.9 Limitation on Transactions with Affiliates
	 	 	71	 






iii









 






	 	 	 	 	 
	 	 	Page	 
	7.2.10 Indebtedness
	 	 	72	 
	7.2.11 Limitation on Modifications of Tax Agreement and Mafco Assignment and
Assumption Agreement
	 	 	73	 
	7.2.12 Hedge Agreements
	 	 	73	 
	7.2.13 Changes in Fiscal Periods
	 	 	73	 
	7.2.14 Limitation on Negative Pledge Clauses
	 	 	73	 
	7.2.15 Limitation on Lines of Business
	 	 	73	 
	7.2.16 Limitation on Restrictions on Subsidiary Distributions
	 	 	73	 
	 
	 	 	 	 
	8. DEFAULT
	 	 	74	 
	8.1 Events of Default
	 	 	74	 
	8.2 Consequences of Event of Default
	 	 	76	 
	8.2.1 Events of Default Other Than Bankruptcy, Insolvency or
Reorganization Proceedings
	 	 	76	 
	8.2.2 Bankruptcy, Insolvency or Reorganization Proceedings
	 	 	77	 
	8.2.3 Set-off
	 	 	77	 
	8.2.4 Application of Proceeds
	 	 	77	 
	8.3 Right to Cure
	 	 	78	 
	 
	 	 	 	 
	9. THE ADMINISTRATIVE AGENT
	 	 	79	 
	9.1 Appointment and Authority
	 	 	79	 
	9.2 Rights as a Lender
	 	 	79	 
	9.3 Exculpatory Provisions
	 	 	79	 
	9.4 Reliance by Administrative Agent
	 	 	80	 
	9.5 Delegation of Duties
	 	 	80	 
	9.6 Resignation of Administrative Agent
	 	 	80	 
	9.7 Non-Reliance on Administrative Agent and Other Lenders
	 	 	81	 
	9.8 No Other Duties, etc.
	 	 	82	 
	9.9 Administrative Agent’s Fee
	 	 	82	 
	9.10 Release Collateral and Guarantors and Authorization Therefor
	 	 	82	 
	9.11 No Reliance on Administrative Agent’s Customer Identification Program
	 	 	82	 
	 
	 	 	 	 
	10. MISCELLANEOUS
	 	 	82	 
	10.1 Modifications, Amendments or Waivers
	 	 	82	 
	10.1.1 Increase of Commitment
	 	 	83	 
	10.1.2 Extension of Payment; Reduction of Principal Interest or Fees;
Modification of Terms of Payment
	 	 	83	 
	10.1.3 Release of Collateral or Guarantor
	 	 	83	 
	10.1.4 Miscellaneous
	 	 	83	 
	10.2 No Implied Waivers; Cumulative Remedies
	 	 	83	 
	10.3 Expenses; Indemnity; Damage Waiver
	 	 	84	 
	10.3.1 Costs and Expenses
	 	 	84	 
	10.3.2 Indemnification by the Borrower
	 	 	84	 
	10.3.3 Reimbursement by Lenders
	 	 	85	 
	10.3.4 Waiver of Consequential Damages, Etc
	 	 	85	 
	10.3.5 Payments
	 	 	85	 






iv









 






	 	 	 	 	 
	 	 	Page	 
	10.4 Holidays
	 	 	85	 
	10.5 Notices; Effectiveness; Electronic Communication
	 	 	86	 
	10.5.1 Notices Generally
	 	 	86	 
	10.5.2 Electronic Communications
	 	 	86	 
	10.5.3 Change of Address, Etc.
	 	 	86	 
	10.6 Severability
	 	 	87	 
	10.7 Duration; Survival
	 	 	87	 
	10.8 Successors and Assigns
	 	 	87	 
	10.8.1 Successors and Assigns Generally
	 	 	87	 
	10.8.2 Assignments by Lenders
	 	 	87	 
	10.8.3 Register
	 	 	89	 
	10.8.4 Participations
	 	 	89	 
	10.8.5 Limitations upon Participant Rights Successors and Assigns Generally
	 	 	89	 
	10.8.6 Certain Pledges; Successors and Assigns Generally
	 	 	90	 
	10.9 Confidentiality
	 	 	90	 
	10.9.1 General
	 	 	90	 
	10.9.2 Sharing Information With Affiliates of the Lenders
	 	 	90	 
	10.10 Counterparts; Integration; Effectiveness
	 	 	90	 
	10.10.1 Counterparts; Integration; Effectiveness
	 	 	90	 
	10.11 CHOICE OF LAW; SUBMISSION TO JURISDICTION; WAIVER OF VENUE; SERVICE OF
PROCESS; WAIVER OF JURY TRIAL
	 	 	91	 
	10.11.1 Governing Law
	 	 	91	 
	10.11.2 SUBMISSION TO JURISDICTION
	 	 	91	 
	10.11.3 WAIVER OF VENUE
	 	 	92	 
	10.11.4 SERVICE OF PROCESS
	 	 	92	 
	10.11.5 WAIVER OF JURY TRIAL
	 	 	92	 
	10.12 USA Patriot Act Notice
	 	 	92	 






v









 





LIST OF SCHEDULES AND EXHIBITS




	 	 	 	 	 
	SCHEDULES	 	 	 	 
	 
	Schedule 1.1(A)

	 	-
	 	Pricing Grid
	Schedule 1.1(B)

	 	-
	 	Commitment of Lenders and Addresses for Notices
	Schedule 5.1.4

	 	 	 	Power; Authority; Enforceable Obligations
	Schedule 5.1.14

	 	 	 	Subsidiaries
	Schedule 7.2.2(xii)

	 	 	 	Permitted Liens
	Schedule 7.2.10(iii)

	 	 	 	Existing Indebtedness
	 
	 	 	 	 
	EXHIBITS
	 	 	 	 
	 
	 	 	 	 
	Exhibit 1.1(A)

	 	-
	 	Assignment and Assumption Agreement
	Exhibit 1.1(G)(2)

	 	 	 	Guaranty and Collateral Agreement
	Exhibit 1.1(M)

	 	 	 	Mafco Assignment and Assumption Agreement
	Exhibit 1.1(N)(1)

	 	-
	 	Revolving Credit Note
	Exhibit 1.1(N)(2)

	 	-
	 	Swing Loan Note
	Exhibit 2.4.1

	 	 	 	Loan Request
	Exhibit 2.4.2

	 	-
	 	Swing Loan Request











vi









 








CREDIT AGREEMENT




     THIS CREDIT AGREEMENT (as hereafter amended, supplemented or otherwise modified from time to
time, this “Agreement”) is dated as of December 15, 2010 and is made by and among MAFCO WORLDWIDE
CORPORATION, a Delaware corporation (the “Borrower”), the LENDERS (as hereinafter defined), and PNC
BANK, NATIONAL ASSOCIATION, in its capacity as administrative agent for the Lenders under this
Agreement (hereinafter referred to in such capacity, together with its successors and assigns, as
the “Administrative Agent”).



     The Borrower has requested the Lenders to provide a revolving credit facility to the Borrower
in an aggregate principal amount not to exceed $45,000,000. In consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound hereby, the
parties hereto covenant and agree as follows:



1. CERTAIN DEFINITIONS




     1.1 Certain Definitions. In addition to words and terms defined elsewhere in this
Agreement, the following words and terms shall have the following meanings, respectively, unless
the context hereof clearly requires otherwise:



          “Acquired Person” shall have the meaning specified in the definition of “Permitted
Acquisition”.




          “Adjusted Ratable Share” shall mean, with respect to any Non-Defaulting Lender, the
quotient (expressed as a percentage) of such Non-Defaulting Lender’s Ratable Share divided by the
aggregate Ratable Shares of all Non-Defaulting Lenders.




          “Administrative Agent” shall have the meaning set forth in the preamble hereto.




          “Administrative Agent’s Fee” shall have the meaning specified in Section 9.9.




          “Administrative Agent’s Letter” shall have the meaning specified in Section 9.9.




          “Affiliate” as to any Person shall mean any other Person which directly or indirectly
controls, is controlled by, or is under common control with such Person; provided that for purposes
of Section 7.2.9 only, “Affiliate” shall also include any other Person (i) which beneficially owns
or holds 10% or more of any class of the voting or other equity interests of such Person, or
(ii) 10% or more of any class of voting interests or other equity interests of which is
beneficially owned or held, directly or indirectly, by such Person.




          “Agreement” shall have the meaning set forth in the preamble hereto.




          “Anti-Terrorism Laws” shall mean any Laws relating to terrorism or money laundering,
including Executive Order No. 13224, the USA Patriot Act, the Laws comprising or implementing the
Bank Secrecy Act, and the Laws administered by the United States Treasury Department’s Office of
Foreign Asset Control (as any of the foregoing Laws may from time to time be amended, renewed,
extended, or replaced).







 









 








          “Applicable Commitment Fee Rate” shall mean the percentage rate per annum based on the
Consolidated Leverage Ratio then in effect according to the pricing grid on Schedule 1.1(A)
below the heading “Commitment Fee.”




          “Applicable Letter of Credit Fee Rate” shall mean the percentage rate per annum based
on the Consolidated Leverage Ratio then in effect according to the pricing grid on Schedule
1.1(A) below the heading “Letter of Credit Fee.”




          “Applicable Margin” shall mean, as applicable:




          (A) the percentage spread to be added to the Base Rate applicable to Revolving Credit Loans
under the Base Rate Option based on the Consolidated Leverage Ratio then in effect according to the
pricing grid on Schedule 1.1(A) below the heading “Revolving Credit Base Rate Spread,” or




          (B) the percentage spread to be added to the LIBOR Rate applicable to Revolving Credit Loans
under the LIBOR Rate Option based on the Consolidated Leverage Ratio then in effect according to
the pricing grid on Schedule 1.1(A) below the heading “Revolving Credit LIBOR Rate Spread.”




          “Approved Fund” shall mean any fund that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the ordinary course of business and
that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or
an Affiliate of an entity that administers or manages a Lender.




          “Assignment and Assumption Agreement” shall mean an assignment and assumption
agreement entered into by a Lender and an assignee permitted under Section 10.8, in substantially
the form of Exhibit 1.1(A).




          “Authorized Officer” shall mean, with respect to any Loan Party, the Chief Executive
Officer, President, Chief Financial Officer, Senior Vice President- Finance, Treasurer or Assistant
Treasurer of such Loan Party or such other individuals, designated by written notice to the
Administrative Agent from the Borrower, authorized to execute notices, reports and other documents
on behalf of the Loan Parties required hereunder. The Borrower may amend such list of individuals
from time to time by giving written notice of such amendment to the Administrative Agent.




          “Base Rate” shall mean, for any day, a fluctuating per annum rate of interest equal to
the highest of (a) the Federal Funds Open Rate plus 50 basis points (0.5%) and (b) the
Prime Rate, and (c) the Daily LIBOR Rate, plus 100 basis points (1.0%). Any change in the
Base Rate (or any component thereof) shall take effect at the opening of business on the day such
change occurs.




          “Base Rate Option” shall mean the option of the Borrower to have Loans bear interest
at the rate and under the terms set forth in Section 3.1.1 (i).




          “Board” shall mean the Board of Governors of the Federal Reserve System of the United
States (or any successor).




 - 2 - 









 





          “Borrower” shall have the meaning set forth in the preamble hereto.




          “Borrowing Date” shall mean, with respect to any Loan, the date for the making thereof
or the renewal or conversion thereof at or to the same or a different Interest Rate Option, which
shall be a Business Day.




          “Borrowing Tranche” shall mean specified portions of Revolving Credit Loans
outstanding as follows: (i) any Revolving Credit Loans to which a LIBOR Rate Option applies which
become subject to the same Interest Rate Option under the same Loan Request by the Borrower and
which have the same Interest Period shall constitute one Borrowing Tranche, and (ii) all Revolving
Credit Loans to which a Base Rate Option applies shall constitute one Borrowing Tranche.




          “Business” shall have the meaning specified in Section 5.1.15(ii).




          “Business Day” shall mean any day other than a Saturday or Sunday or a legal holiday
on which commercial banks are authorized or required to be closed for business in Pittsburgh,
Pennsylvania and if the applicable Business Day relates to any Loan to which the LIBOR Rate Option
applies, such day must also be a day on which dealings are carried on in the London interbank
market.




          “Capital Expenditures” shall mean for any period, with respect to any Person, (a) the
aggregate of all expenditures by such Person and its Subsidiaries during such period that, in
conformity with GAAP, are or are required to be included as additions during such period to
property, plant and equipment reflected in the consolidated balance sheet of such Person and its
Subsidiaries; provided that the term “Capital Expenditures” shall not include expenditures made in
connection with the replacement, substitution, restoration or repair of assets to the extent
financed with (i) insurance proceeds paid on account of the loss of or damage to the assets being
replaced, restored or repaired or (ii) awards of compensation arising from the taking by eminent
domain or condemnation of the assets being replaced; and (b) such portion of principal payments on
Capital Lease Obligations made by such Person and its Subsidiaries during such period as is
attributable to additions to property, plant and equipment that have not otherwise been reflected
in the consolidated balance sheet of such Person and its Subsidiaries.




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




          “Capital Stock” shall mean any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all equivalent
ownership interests in a Person (other than a corporation) and any and all warrants, rights or
options to purchase any of the foregoing.




          “Cash Equivalents” shall mean (i) securities with maturities of one year or less from
the date of acquisition issued or fully guaranteed or insured by the United States of






 - 3 - 









 







America or any agency thereof, (ii) certificates of deposit and eurodollar time deposits with
maturities of one year or less from the date of acquisition and overnight bank deposits of any
Lender or of any commercial bank having capital and surplus in excess of $500,000,000,
(iii) repurchase obligations of any Lender or of any commercial bank satisfying the requirements of
clause (ii) of this definition having a term of not more than 30 days with respect to securities
issued or fully guaranteed or insured by the United States of America, (iv) commercial paper of a
domestic issuer rated at least A-1 by S&P or P-1 by Moody’s, (v) securities with maturities of one
year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States of America or by any political subdivision or taxing authority of
any such state, commonwealth or territory or by any foreign government, the securities of which
state, commonwealth, territory, political subdivision, taxing authority or foreign government (as
the case may be) are rated at least A by S&P or A by Moody’s, (vi) securities with maturities of
one year or less from the date of acquisition backed by standby letters of credit issued by any
Lender or any commercial bank satisfying the requirements of clause (ii) of this definition or
(vii) shares of money market, mutual or similar funds which invest exclusively in assets satisfying
the requirements of clauses (i) through (vi) of this definition.




          “Cash Management Agreement” shall have the meaning specified in Section 2.4.2.




          “Change of Control” shall mean if any time (i) any “person” or “group” (as such terms
are used in Sections 13(d) and 14(d) of the Exchange Act), excluding the Sponsor Group, shall
become, or obtain rights (whether by means of warrants, options or otherwise) to become, the
“beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or
indirectly, of more than the greater of (x) 35% of the outstanding common stock of M & F Worldwide,
and (y) the amount of outstanding common stock of M & F Worldwide then beneficially owned by the
Sponsor Group and each of its beneficial owners; (ii) the board of directors of M & F Worldwide
shall cease to consist of a majority of Continuing Directors; or (iii) M & F Worldwide shall cease
to own and control, of record and beneficially, directly or indirectly, 100% of each class of
outstanding Capital Stock of the Borrower free and clear of all Liens (except Liens created by the
Guarantee and Collateral Agreement).




          “Change in Law” shall mean the occurrence, after the date of this Agreement, of any of
the following: (a) the adoption or taking effect of any Law, (b) any change in any Law or in the
administration, interpretation or application thereof by any Official Body or (c) the making or
issuance of any request, guideline or directive (whether or not having the force of Law) by any
Official Body; provided, however, that notwithstanding anything herein to the
contrary, the Dodd-Frank Wall Street Reform and Consumer Protection Act and each request, rule,
guideline or directive thereunder or issued in connection therewith shall be deemed to be a “Change
in Law”, regardless of the date enacted, adopted or issued.




          “CIP Regulations” shall have the meaning specified in Section 9.11.




          “Closing Date” shall mean the Business Day on which the first Loan shall be made,
which shall be December 15, 2010.







 - 4 - 









 








          “Code” shall mean the Internal Revenue Code of 1986, as the same may be amended or
supplemented from time to time, and any successor statute of similar import, and the rules and
regulations thereunder, as from time to time in effect.




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




          “Commitment” shall mean as to any Lender the aggregate of its Revolving Credit
Commitment and, in the case of PNC, its Swing Loan Commitment, and “Commitments” shall mean
the aggregate of the Revolving Credit Commitments and Swing Loan Commitment of all of the Lenders.




          “Commitment Fee” shall have the meaning specified in Section 2.3.




          “Compliance Certificate” shall have the meaning specified in Section 7.1.2(ii).




          “Consolidated Current Assets” shall mean, at any date, all amounts (other than cash
and Cash Equivalents) that would, in conformity with GAAP, be set forth opposite the caption “total
current assets” (or any like caption) on a consolidated balance sheet of the Borrower and its
Subsidiaries at such date.




          “Consolidated Current Liabilities” shall mean, at any date, all amounts that would, in
conformity with GAAP, be set forth opposite the caption “total current liabilities” (or any like
caption) on a consolidated balance sheet of the Borrower and its Subsidiaries at such date, but
excluding (i) the current portion of any Funded Debt of the Borrower and its Subsidiaries and
(ii) without duplication of clause (i) above, all Indebtedness consisting of Revolving Credit Loans
or Swing Loans to the extent otherwise included therein.




          “Consolidated EBITDA” shall mean for any fiscal period of the Borrower, the
Consolidated Net Income or Consolidated Net Loss, as the case may be, for such fiscal period,
(a) after restoring thereto (i) extraordinary or non-recurring non-cash charges,(ii) losses
resulting from Dispositions other than in the ordinary course of business, (iii) depreciation and
amortization (including write-offs or write-downs of amortizable and depreciable items),
(iv) Consolidated Interest Expense, (v) “provision for taxes” (or any like caption) on a
consolidated statement of earnings of the Borrower and its Subsidiaries for such fiscal period,
(vi) any losses in respect of currency fluctuations, (vii) fifty percent (50%) of any severance
costs or charges, provided that the restoration permitted by this clause (vii) shall not exceed
$2,500,000 in the aggregate during the term of this Agreement and (viii) any fees, expenses or
charges related to the negotiation, execution and closing of this Agreement and the other Loan
Documents and any amendment, modification or waiver of the Loan Documents and (b) deducting
therefrom (i) extraordinary or non-recurring income or gains (which shall include, whether or not
so includable in accordance with GAAP, any item of gain resulting from Dispositions other than in
the ordinary course of business whether or not extraordinary or non-recurring), (ii) the portion of
net income of the Borrower and its Subsidiaries allocable to interests in unconsolidated Persons to
the extent that cash dividends or distributions in respect of such portion of net income have not
actually been received by the Borrower or any Subsidiary Guarantor, (iii) any gains in respect of
currency fluctuations, (iv) any other non-cash income and






 - 5 - 









 







(v) any cash payments made during such period in respect of items described in clause (a)(i)
above subsequent to the fiscal quarter in which the relevant non-cash charges were reflected as a
charge in the statement of Consolidated Net Income; provided any such restorations or
deductions shall only be restored or deducted to the extent included in the determination of
Consolidated Net Income or Consolidated Net Loss. For the purposes of calculating Consolidated
EBITDA for any period of four consecutive fiscal quarters (each, a “Reference Period”)
pursuant to any determination of the Consolidated Leverage Ratio, (i) if at any time during such
Reference Period the Borrower or any Subsidiary shall have made any Material Disposition, the
Consolidated EBITDA for such Reference Period shall be reduced by an amount equal to the
Consolidated EBITDA (if positive) attributable to the property that is the subject of such Material
Disposition for such Reference Period or increased by an amount equal to the Consolidated EBITDA
(if negative) attributable thereto for such Reference Period and (ii) if during such Reference
Period the Borrower or any Subsidiary shall have made a Material Acquisition, Consolidated EBITDA
for such Reference Period shall be calculated after giving pro forma effect thereto (including pro
forma adjustments for cost savings to the extent approved in writing by the Administrative Agent)
as if such Material Acquisition occurred on the first day of such Reference Period. As used in
this definition, “Material Acquisition” means any acquisition of property or series of
related acquisitions of property that (x) constitutes assets comprising all or substantially all of
an operating unit of a business or constitutes all or substantially all of the common stock of a
Person and (y) involves the payment of consideration by the Borrower and its Subsidiaries in excess
of $2,000,000; and “Material Disposition” means any Disposition of property or series of
related Dispositions of property that yields gross proceeds to the Borrower or any of its
Subsidiaries in excess of $2,000,000.




          “Consolidated Interest Coverage Ratio” shall mean at the last day of any fiscal
quarter, the ratio of (a) (i) Consolidated EBITDA for the period of four consecutive fiscal
quarters ending on such date less (ii) Capital Expenditures for the period of four consecutive
fiscal quarters ending on such date to (b) Consolidated Interest Expense for the period of four
consecutive fiscal quarters ending on such date.




          “Consolidated Interest Expense” shall mean for any fiscal period of the Borrower, the
amount that, in conformity with GAAP, would be set forth opposite the caption “interest expense”
(or any like caption) on a consolidated statement of earnings of the Borrower and its Subsidiaries
for such fiscal period, less, to the extent otherwise included in the calculation of Consolidated
Interest Expense, amortization of deferred financing fees and debt issuance costs, relating to the
negotiation, execution and closing of this Agreement and the other Loan Documents and any
amendment, modification or waiver of the Loan Documents, in each case during such fiscal period.




          “Consolidated Leverage Ratio” shall mean at the last day of any fiscal quarter, the
ratio of (a) Total Debt (after giving effect to all prepayments and borrowings made on such day) on
such day to (b) Consolidated EBITDA for the period of four consecutive fiscal quarters ending on
such day.




          “Consolidated Net Income” or “Consolidated Net Loss” shall mean for any fiscal
period of the Borrower, the amount which, in conformity with GAAP, would be set forth opposite the
caption “net income” (or any like caption) or “net loss” (or any like caption), as the






 - 6 - 









 







case may be, on a consolidated statement of earnings of the Borrower and its Subsidiaries for
such fiscal period.




          “Consolidated Working Capital” shall mean, at any date, the excess of Consolidated
Current Assets on such date over Consolidated Current Liabilities on such date.




          “Continuing Directors” shall mean the directors of M & F Worldwide on the Closing
Date, and each other director if, in each case, such other director’s nomination for election to
the board of directors of M & F Worldwide is approved by at least a majority of the then Continuing
Directors.




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




          “Customs” shall have the meaning set forth in Section 2.8.12.




          “Daily LIBOR Rate” shall mean, for any day, the rate per annum determined by the
Administrative Agent by dividing (i) the Published Rate by (ii) a number equal to 1.00 minus the
LIBOR Reserve Percentage on such day.




          “Defaulting Lender” shall mean any Lender that (i) has failed to fund any portion of
the Loans, participations with respect to Letters of Credit, or participations in Swing Loans
required to be funded by it hereunder within one Business Day of the date required to be funded by
it hereunder unless such failure has been cured and all interest accruing as a result of such
failure has been fully paid in accordance with the terms hereof, (ii) has otherwise failed to pay
over to the Administrative Agent or any other Lender any other amount required to be paid by it
hereunder within one Business Day of the date when due, unless the subject of a good faith dispute
or unless such failure has been cured and all interest accruing as a result of such failure has
been fully paid in accordance with the terms hereof, (iii) has failed at any time to comply with
the provisions of Section 4.3 with respect to purchasing participations from the other Lenders,
whereby such Lender’s share of any payment received, whether by setoff or otherwise, is in excess
of its Ratable Share of such payments due and payable to all of the Lenders, or (iv) has since the
date of this Agreement been deemed insolvent by an Official Body or become the subject of an
Insolvency Proceeding, or has a parent company that since the date of this Agreement been deemed
insolvent by an Official Body or become the subject of an Insolvency Proceeding.




          “Disposition” with respect to any property, any sale, lease, sale and leaseback,
assignment, conveyance, transfer or other disposition thereof. The terms “Dispose” and
“Disposed of” shall have the correlative meanings.




          “Disqualified Capital Stock” shall mean Capital Stock that (i) matures or is
mandatorily redeemable or subject to mandatory repurchase or redemption or repurchase at the option
of the holders hereof, in each case, in whole or in part and whether upon the occurrence of any
event, pursuant to a sinking fund obligation, on a fixed date or otherwise, prior to the date that
is 180 days after the Expiration Date or (ii) is convertible or exchangeable, automatically or






 - 7 - 









 







at the option of any holder thereof, into Disqualified Capital Stock; provided that any
Capital Stock that would fall within the definition of “Disqualified Capital Stock” solely because
the holders thereof have the right to require the issuer thereof to redeem such Capital Stock upon
the occurrence of a change of control will not constitute Disqualified Capital Stock if the terms
of such Capital Stock provide that the issuer may only redeem such Capital Stock if, and to the
extent, that Payment in Full of the Obligations shall have occurred.




          “Dollar”, “Dollars”, “U.S. Dollars” and the symbol $ shall mean lawful money
of the United States of America.




          “Domestic Subsidiary” shall mean any Subsidiary of the Borrower organized under the
laws of any jurisdiction within the United States.




          “Drawing Date” shall have the meaning specified in Section 2.8.3.1.




          “Environmental Laws” shall mean any and all applicable and binding foreign, Federal,
state, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees,
requirements of any Official Body or other Laws (including common law) regulating, relating to or
imposing liability or standards of conduct concerning exposure of Materials of Environmental
Concern or protection of the environment or health or safety matters related to the exposure to
Materials of Environmental Concern, as now or may at any time hereafter be in effect.




          “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the same
may be amended or supplemented from time to time, and any successor statute of similar import, and
the rules and regulations thereunder, as from time to time in effect.




          “ERISA Affiliate” shall mean, at any time, any trade or business (whether or not
incorporated) under common control with the Borrower and are treated as a single employer under
Section 414 of the Code.




          “ERISA Event” shall mean (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA
during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of
ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing
of a notice of intent to terminate, the treatment of a Plan amendment as a termination under
Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any
Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under Title IV of ERISA,
other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate.




          “Event of Default” shall mean any of the events described in Section 8.1 and referred
to therein as an “Event of Default.”







 - 8 - 









 








          “Excess Cash Flow” shall mean for any period, the excess, if any, of (a) the sum,
without duplication, of (1) Consolidated Net Income for such period, (2) the amount of all non-cash
charges (including depreciation and amortization) deducted in arriving at such Consolidated Net
Income, (3) the aggregate net amount of loss on the Disposition of property by the Borrower and its
Subsidiaries during such period (other than sales of inventory in the ordinary course of business)
and (4) decreases in Consolidated Working Capital over (b) the sum, without duplication, of
(1) the amount of all non-cash credits included in arriving at such Consolidated Net Income,
(2) the aggregate amount actually paid by the Borrower and its Subsidiaries in cash during such
period on account of Capital Expenditures (excluding the principal amount of Indebtedness incurred
in connection with such expenditures), (3) the aggregate amount of all regularly scheduled
principal payments of Funded Debt of the Borrower and its Subsidiaries made during such period
(other than in respect of any revolving credit facility to the extent there is not an equivalent
permanent reduction in commitments thereunder), (4) increases in Consolidated Working Capital,
(5) the aggregate net amount of gain on the Disposition of property by the Borrower and its
Subsidiaries during such period (other than sales of inventory in the ordinary course of business),
to the extent included in arriving at such Consolidated Net Income, (6) the aggregate amount of
Restricted Payments made pursuant to Sections 7.2.6(i), (ii), (iii) and (vi) and (7) the aggregate
amount of cash consideration paid during such fiscal year by the Borrower and its consolidated
Subsidiaries to make Permitted Acquisitions.




          “Excluded Taxes” shall mean, with respect to the Administrative Agent, any Lender, the
Issuing Lender or any other recipient of any payment to be made by or on account of any obligation
of the Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however
denominated) and franchise taxes (in lieu of net income taxes), in each case imposed on it as a
result of a present or former connection between any such recipient and the jurisdiction of the
Official Body imposing such tax (other than any such connection arising solely from such
recipient’s having executed, delivered or performed its obligations or received a payment under, or
enforced, this Agreement or any other Loan Document), (b) any branch profits taxes imposed by the
United States of America or any similar tax imposed by any other jurisdiction in which the Borrower
is located, (c) in the case of a Foreign Lender, any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or
designates a new lending office), except to the extent that such Foreign Lender (or its assignor,
if any) was entitled, at the time of designation of a new lending office (or assignment), to
receive additional amounts from the Borrower with respect to such withholding tax pursuant to
Section 4.8.1, (d) any withholding taxes (including backup withholding taxes) that are attributable
to such recipient’s failure or inability (other than as a result of a Change in Law) to (i) comply
with Section 4.8.5 or (ii) certify (where prescribed by applicable Law or upon reasonable request
by the Borrower or the Administrative Agent) that such recipient is not subject to backup
withholding tax, and (e) any withholding tax imposed on a Foreign Lender as a result of such
Foreign Lender’s failure to comply with FATCA.




          “Executive Order No. 13224” shall mean the Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001, as the same has been, or shall hereafter be, renewed,
extended, amended or replaced.







 - 9 - 









 








          “Existing Credit Agreement” shall mean the Credit Agreement, dated as of December 8,
2005 among Holdings, the Borrower, the lenders party thereto and JPMorgan Chase Bank, N.A., as
administrative agent, as heretofore amended.




          “Expiration Date” shall mean December 15, 2015.




          “FATCA” shall mean Section 1471 through 1474 of the Code and any regulations or
official interpretations thereof.




          “Federal Funds Effective Rate” for any day shall mean the rate per annum (based on a
year of 360 days and actual days elapsed and rounded upward to the nearest 1/100 of 1%) announced
by the Federal Reserve Bank of New York (or any successor) on such day as being the weighted
average of the rates on overnight federal funds transactions arranged by federal funds brokers on
the previous trading day, as computed and announced by such Federal Reserve Bank (or any successor)
in substantially the same manner as such Federal Reserve Bank computes and announces the weighted
average it refers to as the “Federal Funds Effective Rate” as of the date of this Agreement;
provided, if such Federal Reserve Bank (or its successor) does not announce such rate on
any day, the “Federal Funds Effective Rate” for such day shall be the Federal Funds Effective Rate
for the last day on which such rate was announced.




          “Federal Funds Open Rate” for any day shall mean the rate per annum (based on a year
of 360 days and actual days elapsed) which is the daily federal funds open rate as quoted by ICAP
North America, Inc. (or any successor) as set forth on the Bloomberg Screen BTMM for that day
opposite the caption “OPEN” (or on such other substitute Bloomberg Screen that displays such rate),
or as set forth on such other recognized electronic source used for the purpose of displaying such
rate as selected by the Administrative Agent (for purposes of this definition, an “Alternate
Source”) (or if such rate for such day does not appear on the Bloomberg Screen BTMM (or any
substitute screen) or on any Alternate Source, or if there shall at any time, for any reason, no
longer exist a Bloomberg Screen BTMM (or any substitute screen) or any Alternate Source, a
comparable replacement rate determined by the Administrative Agent at such time (which
determination shall be conclusive absent manifest error); provided however, that if such day is not
a Business Day, the Federal Funds Open Rate for such day shall be the “open” rate on the
immediately preceding Business Day. If and when the Federal Funds Open Rate changes, the rate of
interest hereunder will change automatically without notice to the Borrower, effective on the date
of any such change.




          “Financial Covenants” shall have the meaning specified in Section 8.3.




          “Foreign Lender” shall mean any Lender that is organized under the Laws of a
jurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of
this definition, the United States of America, each State thereof and the District of Columbia
shall be deemed to constitute a single jurisdiction.




          “Foreign Subsidiary” shall mean any Subsidiary of the Borrower that is not a Domestic
Subsidiary.




          “Fully Secured” shall mean, with respect to any Undrawn L/C Obligations as of any
date, that, on or before such date, such Undrawn L/C Obligations shall have been secured by






 - 10 - 









 







(i) the grant to the Issuing Lender by the Borrower of a first priority, perfected security
interest in, and Lien on, (a) cash or Cash Equivalents in an amount at least equal to the excess,
if any, of the amount of such Undrawn L/C Obligations over the amount of the aggregate Commitments
of all of the Lenders on such date, or (b) other collateral security which is acceptable to the
Issuing Lender or (ii) delivery to the Issuing Lender of letters of credit in a face amount at
least equal to the excess, if any, of the amount of such Undrawn L/C Obligations over the amount of
the aggregate Commitments of all of the Lenders on such date and otherwise in form and substance,
and from a letter of credit issuer, reasonably satisfactory to the Issuing Lender.




          “Funded Debt” shall mean as to any Person, all Indebtedness of such Person that
matures more than one year from the date of its creation or matures within one year from such date
but is renewable or extendible, at the option of such Person, to a date more than one year from
such date or arises under a revolving credit or similar agreement that obligates the lender or
lenders to extend credit during a period of more than one year from such date, including all
current maturities and current sinking fund payments in respect of such Indebtedness whether or not
required to be paid within one year from the date of its creation and, in the case of the Borrower,
Indebtedness in respect of the Loans.




          “GAAP” shall mean generally accepted accounting principles as are in effect from time
to time, subject to the provisions of Section 1.3, and applied on a consistent basis both as to
classification of items and amounts; provided, that if the Borrower reasonably determines
that it is required to prepare and maintain its financial statements in accordance with
International Financial Reporting Standards, “GAAP” shall, upon prior written notice to the
Administrative Agent pursuant to Section 7.1.7 hereof, mean International Financial Reporting
Standards as are in effect from time to time, subject to the provisions of Section 1.3.




          “Group Members” shall mean the collective reference to Holdings, the Borrower and
their respective Subsidiaries.




          “Guarantee and Collateral Agreement” shall mean the Guarantee and Collateral Agreement
in substantially the form of Exhibit 1.1(G)(2) executed and delivered by the Borrower and
each of the Guarantors.




          “Guarantee Obligation” shall mean as to any Person (the “guaranteeing
person”), any obligation of (a) the guaranteeing person or (b) another Person (including any
bank under any letter of credit) to induce the creation of which the guaranteeing person has issued
a reimbursement, counterindemnity or similar obligation, in either case guaranteeing or in effect
guaranteeing any Indebtedness, leases, dividends or other obligations (the “primary
obligations”) of any other third Person (the “primary obligor”) in any manner, whether
directly or indirectly, including any obligation of the guaranteeing person, whether or not
contingent, (i) to purchase any such primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of any
such primary obligation or (2) to maintain working capital or equity capital of the primary obligor
or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase
property, securities or services primarily for the purpose of assuring the owner of any such
primary obligation of the ability of the primary obligor to make payment of such primary obligation
or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss
in respect thereof; provided,






 - 11 - 









 







however, that the term Guarantee Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business. The amount of any
Guarantee Obligation of any guaranteeing person shall be deemed to be the lower of (a) an amount
equal to the stated or determinable amount of the primary obligation in respect of which such
Guarantee Obligation is made and (b) the maximum amount for which such guaranteeing person may be
liable pursuant to the terms of the instrument embodying such Guarantee Obligation, unless such
primary obligation and the maximum amount for which such guaranteeing person may be liable are not
stated or determinable, in which case the amount of such Guarantee Obligation shall be such
guaranteeing person’s maximum reasonably anticipated liability in respect thereof as determined by
the Borrower in good faith.




          “Guarantor” shall mean each of the parties to this Agreement which is designated as a
“Guarantor” on the signature page of the Guarantee and Collateral Agreement and each other Person
which joins the Guarantee and Collateral Agreement as a Guarantor after the date hereof.




          “Guaranty” of any Person shall mean any obligation of such Person guaranteeing or in
effect guaranteeing any liability or obligation of any other Person in any manner, whether directly
or indirectly, including any agreement to indemnify or hold harmless any other Person, any
performance bond or other suretyship arrangement and any other form of assurance against loss, in
each case except endorsement of negotiable or other instruments for deposit or collection in the
ordinary course of business.




          “Hedge Agreements” shall mean all interest rate swaps, caps or collar agreements or
similar arrangements dealing with interest rates or currency exchange rates or the exchange of
nominal interest obligations, either generally or under specific contingencies.




          “Holdings” shall mean Flavor Holdings, Inc., a Delaware corporation.




          “ICC” shall have the meaning specified in Section 10.11.1.




          “Immaterial Foreign Subsidiary” shall mean any Foreign Subsidiary whose (i) assets,
(ii) revenues and (iii) earnings before interest, taxes, depreciation and amortization (excluding
intercompany receivables and revenues that would be eliminated upon consolidation in accordance
with GAAP), at the time of determination (determined, in the case of clauses (ii) and (iii), in
respect of the most recent period of four consecutive fiscal quarters of the Borrower for which the
relevant financial information is available), in each case do not exceed $1,000,000.




          “Indebtedness” of any Person at any date, without duplication, (i) all indebtedness of
such Person for borrowed money, (ii) all obligations of such Person for the deferred purchase price
of services or property, which purchase price (a) is due twelve months or more from the date of
incurrence of the obligation in respect thereof or (b) customarily or actually is evidenced by a
note or other written instrument (other than current trade payables incurred in the ordinary course
of such Person’s business, (iii) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (iv) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such agreement in the






 - 12 - 









 







event of default are limited to repossession or sale of such property), (v) all Capital Lease
Obligations of such Person, (vi) all obligations of such Person, contingent or otherwise, as an
account party or applicant under or in respect of acceptances, letters of credit, surety bonds or
similar arrangements, (vii) the liquidation value of all Disqualified Capital Stock of such Person,
(viii) all Guarantee Obligations of such Person in respect of obligations of the kind referred to
in clauses (i) through (vii) above, (ix) all obligations of the kind referred to in clauses (i)
through (viii) above secured by any Lien on property (including accounts and contract rights)
owned by such Person, whether or not such Person has assumed or become liable for the payment of
such obligation, and (x) for the purposes of Sections 7.2.10 and 8.1.5 only, all obligations of
such Person in respect of Hedge Agreements. The Indebtedness of any Person shall include the
Indebtedness of any other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such Person’s ownership
interest in or other relationship with such entity, except to the extent the terms of such
Indebtedness expressly provide that such Person is not liable therefor. Notwithstanding the
foregoing, the term “Indebtedness” shall only include contingent post-closing purchase price
adjustments and/or earn-outs payable to a seller in connection with any Permitted Acquisition to
the extent such post-closing purchase price adjustments and/or earn-outs are reflected as
liabilities on such Person’s balance sheet in accordance with GAAP.




          “Indemnified Taxes” shall mean Taxes other than Excluded Taxes.




          “Indemnitee” shall have the meaning specified in Section 10.3.2.




          “Information” shall mean all information received from the Loan Parties or any of
their Subsidiaries relating to the Loan Parties or any of such Subsidiaries or any of their
respective businesses, other than any such information that is available to the Administrative
Agent, any Lender or the Issuing Lender on a non-confidential basis prior to disclosure by the Loan
Parties or any of their Subsidiaries.




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




          “Insolvency Proceeding” shall mean, with respect to any Person, (i) a case, action or
proceeding with respect to such Person (a) before any court or any other Official Body under any
bankruptcy, insolvency, reorganization or other similar Law now or hereafter in effect, or (b) for
the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator
(or similar official) of any Loan Party or otherwise relating to the liquidation, dissolution,
winding-up or relief of such Person, or (ii) any general assignment for the benefit of creditors,
composition, marshaling of assets for creditors, or other, similar arrangement in respect of such
Person’s creditors generally or any substantial portion of its creditors; undertaken under any Law.




          “Intellectual Property” shall mean the collective reference to all rights, priorities
and privileges relating to intellectual property, whether arising under United States,
multinational or foreign laws or otherwise, including copyrights, copyright licenses, patents,
patent licenses, trademarks, trademark licenses, technology, know-how and processes, and all rights
to sue at law






 - 13 - 









 







or in equity for any infringement or other impairment thereof, including the right to receive
all proceeds and damages therefrom.




          “Interest Period” shall mean the period of time selected by the Borrower in connection
with (and to apply to) any election permitted hereunder by the Borrower to have Revolving Credit
Loans bear interest under the LIBOR Rate Option. Subject to the last sentence of this definition,
such period shall be one, two, three or six Months. Such Interest Period shall commence on the
effective date of such LIBOR Rate Option, which shall be (i) the Borrowing Date if the Borrower is
requesting new Loans, or (ii) the date of renewal of or conversion to the LIBOR Rate Option if the
Borrower is renewing or converting to the LIBOR Rate Option applicable to outstanding Loans.
Notwithstanding the second sentence hereof: (A) any Interest Period which would otherwise end on a
date which 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
next preceding Business Day, and (B) the Borrower shall not select, convert to or renew an Interest
Period for any portion of the Loans that would end after the Expiration Date.




          “Interest Rate Option” shall mean any LIBOR Rate Option or Base Rate Option.




          “IRS” shall mean the Internal Revenue Service.




          “ISP98” shall have the meaning specified in Section 10.11.1.




          “Issuing Lender” shall mean PNC, in its individual capacity as issuer of Letters of
Credit hereunder, and any other Lender that becomes the Issuing Lender in accordance with the last
paragraph of Section 9.6.




          “Law” shall mean any law (including common law), constitution, statute, treaty,
regulation, rule, ordinance, opinion, release, ruling, order, injunction, writ, decree, judgment,
authorization or approval of, or award by or settlement agreement with, any Official Body.




          “Lender Provided Hedge Agreements” shall mean a Hedge Agreement entered into with any
Lender or its Affiliate and with respect to which the Administrative Agent confirms: (i) is
documented in a standard International Swap Dealer Association Agreement, and (ii) provides for the
method of calculating the reimbursable amount of the provider’s credit exposure in a reasonable and
customary manner.




          “Lenders” shall mean the financial institutions named on Schedule 1.1(B) and
their respective successors and assigns as permitted hereunder, each of which is referred to herein
as a Lender. For the purpose of any Loan Document which provides for the granting of a security
interest or other Lien to the Lenders or to the Administrative Agent for the benefit of the Lenders
as security for the Obligations, “Lenders” shall include any Affiliate of a Lender to which
Obligations in respect of Lender-Provided Hedge Agreements, Other Lender Provided Financial
Services Products or indemnification obligations under the Loan Documents are owed.




          “Letter of Credit” shall have the meaning specified in Section 2.8.1 .




          “Letter of Credit Borrowing” shall have the meaning specified in Section 2.8.3.







 - 14 - 









 








          “Letter of Credit Collateral Account” shall have the meaning specified in Section
2.8.13(c)(iii)(D).




          “Letter of Credit Fee” shall have the meaning specified in Section 2.8.2 .




          “Letter of Credit Obligation” shall mean, as of any date of determination, the
aggregate amount available to be drawn under all outstanding Letters of Credit on such date
plus the aggregate Reimbursement Obligations and Letter of Credit Borrowings on such date.




          “Letter of Credit Sublimit” shall have the meaning specified in Section 2.8.1 .




          “LIBOR Rate” shall mean, with respect to the Loans comprising any Borrowing Tranche to
which the LIBOR Rate Option applies for any Interest Period, the interest rate per annum determined
by the Administrative Agent by dividing (the resulting quotient rounded upwards, if necessary, to
the nearest 1/100th of 1% per annum) (i) the rate which appears on the Bloomberg Page BBAM1 (or on
such other substitute Bloomberg page that displays rates at which US dollar deposits are offered by
leading banks in the London interbank deposit market), or the rate which is quoted by another
source selected by the Administrative Agent which has been approved by the British Bankers’
Association as an authorized information vendor for the purpose of displaying rates at which US
dollar deposits are offered by leading banks in the London interbank deposit market (for purposes
of this definition, an “Alternate Source”), at approximately 11:00 a.m., London time, two (2)
Business Days prior to the commencement of such Interest Period as the London interbank offered
rate for U.S. Dollars for an amount comparable to such Borrowing Tranche and having a borrowing
date and a maturity comparable to such Interest Period (or if there shall at any time, for any
reason, no longer exist a Bloomberg Page BBAM1 (or any substitute page) or any Alternate Source, a
comparable replacement rate determined by the Administrative Agent at such time (which
determination shall be conclusive absent manifest error)), by (ii) a number equal to 1.00 minus the
LIBOR Reserve Percentage. LIBOR may also be expressed by the following formula:



 

London interbank offered rates quoted by Bloomberg




LIBOR Rate     =        or appropriate successor as shown on Bloomberg Page BBAM1



1.00 - LIBOR Reserve Percentage




          The LIBOR Rate shall be adjusted with respect to any Loan to which the LIBOR Rate Option
applies that is outstanding on the effective date of any change in the LIBOR Reserve Percentage as
of such effective date. The Administrative Agent shall give prompt notice to the Borrower of the
LIBOR Rate as determined or adjusted in accordance herewith, which determination shall be
conclusive absent manifest error.




          “LIBOR Rate Option” shall mean the option of the Borrower to have Loans bear interest
at the rate and under the terms set forth in Section 3.1.1 (ii).




          “LIBOR Reserve Percentage” shall mean as of any day the maximum percentage in effect
on such day, as prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the reserve requirements (including supplemental, marginal and






 - 15 - 









 







emergency reserve requirements) with respect to eurocurrency funding (currently referred to as
“Eurocurrency Liabilities”) maintained by a member bank of the Federal Reserve System.




          “Lien” means, with respect to any asset, (i) any mortgage, deed of trust, lien,
pledge, hypothecation, charge, security interest or other encumbrance on, in or of such asset,
(ii) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or
title retention agreement (or any financing lease having substantially the same economic effect as
any of the foregoing, but excluding any operating lease) relating to such asset and (iii) in the
case of securities, any purchase option, call or similar right of a third party with respect to
such securities. “Lien” shall not include any license of any Intellectual Property.




          “Loan Documents” shall mean this Agreement, the Administrative Agent’s Letter, the
Notes, the Security Documents, the Perfection Certificate, the Cash Management Agreement and any
other instruments, certificates or documents delivered in connection herewith or therewith, in each
case as amended, supplemented or modified from time to time.




          “Loan Parties” shall mean the Borrower and the Guarantors.




          “Loan Request” shall have the meaning specified in Section 2.4.1.




          “Loans” shall mean collectively and “Loan” shall mean separately all Revolving
Credit Loans and Swing Loans or any Revolving Credit Loan or Swing Loan.




          “M & F Worldwide” shall mean M & F Worldwide Corp., a Delaware corporation.




          “Mafco Assignment and Assumption Agreement” shall mean that certain Assignment and
Assumption Agreement, dated as of October 29, 2004, between Pneumo Abex Corporation, as assignor,
and the Borrower, as assignee, as attached hereto as Exhibit 1.1(m) hereto, as the same may
be amended, supplemented or otherwise modified to the extent permitted by Section 7.2.11.




          “Material Adverse Effect” shall mean a material adverse effect on (i) the business,
property, operations or condition (financial or otherwise) of the Borrower and its Subsidiaries
taken as a whole or (ii) the validity or enforceability of this Agreement or any of the other Loan
Documents or the rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.




          “Materials of Environmental Concern” shall mean any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products or any hazardous or toxic substances,
materials or wastes, defined or regulated as such in or under any Environmental Law, including
asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.




          “Month” with respect to an Interest Period under the LIBOR Rate Option, shall mean the
interval between the days in consecutive calendar months numerically corresponding to the first day
of such Interest Period. If any LIBOR Rate Interest Period begins on a day of a calendar month for
which there is no numerically corresponding day in the month in which such






 - 16 - 









 







Interest Period is to end, the final month of such Interest Period shall be deemed to end on
the last Business Day of such final month.




          “Moody’s” shall mean Moody’s Investors Service, Inc. or any successor.




          “Multiemployer Plan” shall mean any employee benefit plan which is a “multiemployer
plan” within the meaning of Section 4001(a)(3) of ERISA and to which the Borrower or any ERISA
Affiliate is then making or accruing an obligation to make contributions or, within the preceding
five Plan years, has made or had an obligation to make such contributions.




          “Non-Consenting Lender” shall have the meaning specified in Section 10.1.4.




          “Non-Defaulting Lender” shall mean, at any time, any Lender that is not a Defaulting
Lender at such time.




          “Notes” shall mean, collectively, the Revolving Credit Notes and the Swing Loan Note.




          “Obligations” shall mean the unpaid principal of and interest on (including interest
accruing after the maturity of the Loans, Reimbursement Obligations and Letter of Credit Borrowings
and interest accruing after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding) the Loans and all other
obligations and liabilities of the Borrower to the Administrative Agent or to any Lender (or, in
the case of Lender-Provided Hedge Agreements and Other Lender Provided Financial Services Products,
any Lender Affiliate), whether direct or indirect, absolute or contingent, due or to become due, or
now existing or hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, any other Loan Document, the Letters of Credit, any Lender-Provided Hedge Agreements,
Other Lender Provided Financial Services Products or any other document made, delivered or given in
connection herewith or therewith, whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses (including all fees, charges and disbursements of
counsel to the Administrative Agent or to any Lender that are required to be paid by the Borrower
pursuant hereto) or otherwise.




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




          “Order” shall have the meaning specified in Section 2.8.9.




          “Other Lender Provided Financial Service Product” shall mean agreements or other
arrangements under which any Lender or Affiliate of a Lender provides any of the following products
or services to any of the Loan Parties: (a) credit cards, (b) credit card processing services, (c)
debit cards, (d) purchase cards, (e) ACH transactions, (f) cash






 - 17 - 









 







management, including controlled disbursement, accounts or services, or (g) foreign currency
exchange.




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




          “Participant” has the meaning specified in Section 10.8.4 .




          “Participation Advance” shall have the meaning specified in Section 2.8.3.




          “Payment Date” shall mean the first day of each calendar quarter after the date hereof
and on the Expiration Date or upon acceleration of the Loans.




          “Payment in Full” shall mean, with respect to:




          (i) the Payment Obligations as of any date, that on or before such date, (a) the principal of
and interest accrued to such date on such Payment Obligations shall have been paid in full in cash
(other than the Undrawn L/C Obligations), (b) all Undrawn L/C Obligations shall have been Fully
Secured, (c) all fees, expenses and other amounts then due and payable which constitute Payment
Obligations (other than the Undrawn L/C Obligations) shall have been paid in full in cash and (d)
the Commitments shall have expired or irrevocably been terminated; and




          (ii) the Obligations (and the Borrower Obligations (as defined in the Guarantee and Collateral
Agreement)) as of any date, that, on or before such date, (a) there shall have been Payment in Full
of the Payment Obligations (as provided in clause (i) above) and (b) the Lender Provided Hedge
Agreements shall have been terminated or all obligations thereunder (other than for fees, expenses
and indemnities) shall have been cash collateralized and all fees, expenses and indemnity payments
then due and payable thereunder shall have been paid in full in cash.




          “Payment Obligations” shall mean (i) all principal, interest, fees, charges, expenses,
attorneys’ fees and disbursements, indemnities, reimbursement obligations and any other amounts
payable by any Loan Party under any Loan Document (including, without limitation, the Letter of
Credit Obligations and interest accruing at the then applicable rate provided for herein after the
maturity of the Loans to the extent any Loans are then outstanding and interest accruing at the
then applicable rate provided for herein after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding relating to the Borrower whether
or not a claim for post-filing or post-petition interest is allowed in such proceeding) and (ii)
any amount in respect of any of the foregoing that the Administrative Agent or any Lender, in its
sole discretion, may elect to pay or advance under this Agreement on behalf of such Loan Party
after the occurrence and during the continuance of a Potential Default or an Event of Default.




          “PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA or any successor.







 - 18 - 









 








          “Pension Plan” shall mean any “employee pension benefit plan” (as such term is defined
in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA
and is sponsored or maintained by Borrower or any ERISA Affiliate or to which the Borrower or any
ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made contributions at any times
during the immediately preceding five plan years.




          “Perfection Certificate” shall mean that certain Perfection Certificate delivered by
the Loan Parties pursuant to Section 6.1.1(i).




          “Permitted Acquisition” shall mean the purchase or other acquisition by the Borrower
or any other Subsidiary of Capital Stock in, or all or substantially all the assets of (or all or
substantially all the assets constituting a business unit, division, product line or line of
business of), any Person if:





     (i) in the case of any purchase or other acquisition of Capital Stock in a
Person, such Person will be a Wholly Owned Subsidiary (including as a result of a
merger or consolidation between any Subsidiary and such Person) or (ii) in the case
of any purchase or other acquisition of other assets, such assets will be owned by
the Borrower or a Subsidiary thereof; provided that




     (a) such purchase or acquisition was not preceded by, or consummated pursuant
to, an unsolicited tender offer or proxy contest initiated by or on behalf of
Holdings, the Borrower or any other Subsidiary,




     (b) all transactions related thereto are consummated in accordance with
applicable Law in all material respects,




     (c) the business of such Person and its Subsidiaries (collectively, the
“Acquired Person”), or such assets, as the case may be, constitute a business of the
type conducted by the Borrower and its Subsidiaries on the date hereof and/or
businesses reasonably related thereto,




     (d) with respect to each such purchase or other acquisition, the Borrower has
complied with the provisions of Section 7.1.9 to the extent applicable,




     (e) at the time of and immediately after giving effect to any such purchase or
other acquisition, (I) no Potential Default shall have occurred and be continuing,
(II) Holdings and the Borrower shall be in compliance with the covenants set forth
in Sections 7.2.1(i) and (ii) as of the last day of the most recently ended fiscal
quarter for which financial statements shall have been delivered (or are required to
be delivered) on a pro forma basis and (III) Holdings and the Borrower shall have
delivered to the Administrative Agent a certificate of an Authorized Officer of each
of Holdings and the Borrower, in a form reasonably satisfactory to the
Administrative Agent, certifying that all the requirements set forth in this
definition have been satisfied with respect to such purchase or other



 - 19 - 









 







acquisition, together with reasonably detailed calculations demonstrating
satisfaction of the requirement set forth in clause (e)(II) above.



          “Permitted Cure Securities” shall mean (i) common Capital Stock of Holdings or (ii)
other Capital Stock of Holdings that is not Disqualified Capital Stock and upon which all dividends
or distributions, if any, are payable in additional shares of such Capital Stock.




          “Permitted Exceptions” shall have the meaning specified in Section 7.2.2.




          “Permitted Transferees” shall mean with respect to any Person that is a natural person
(and any Permitted Transferee of such Person), (a) such Person’s immediate family, including his or
her spouse, ex-spouse, children, step-children and their respective lineal descendants and (b) any
trust or other legal entity the beneficiary of which is such Person’s immediate family, including
his or her spouse, ex-spouse, children, step-children or their respective lineal descendants and
which is controlled by such Person.




          “Person” shall mean any individual, corporation, partnership, limited liability
company, association, joint-stock company, trust, unincorporated organization, joint venture,
government or political subdivision or agency thereof, or any other entity.




          “Plan” shall mean at any time an employee pension benefit plan (including a multiple
employer plan described in Section 413(c) of the Code, but not a Multiemployer Plan) which is
covered by Title IV of ERISA or is subject to the minimum funding standards under Sections 412 and
430 of the Code and Sections 302 and 303 of ERISA and either (i) is maintained by the Borrower or
any ERISA Affiliate for employees of the Borrower or any ERISA Affiliate or (ii) has at any time
within the preceding five years been maintained by the Borrower or any ERISA Affiliate for
employees of the Borrower or any ERISA Affiliate.




          “PNC” shall mean PNC Bank, National Association, its successors and assigns.




          “Potential Default” shall mean the events specified in Section 8, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been satisfied.




          “Prime Rate” shall mean the interest rate per annum announced from time to time by the
Administrative Agent at its Principal Office as its then prime rate, which rate may not be the
lowest or most favorable rate then being charged commercial borrowers or others by the
Administrative Agent. Any change in the Prime Rate shall take effect at the opening of business on
the day such change is announced.




          “Principal Office” shall mean the main banking office of the Administrative Agent in
Pittsburgh, Pennsylvania.




          “Pro Forma Balance Sheet” shall have the meaning specified in Section 5.1.1(i).




          “Projections” shall have the meaning specified in Section 7.1.2(iii).




          “Properties” shall have the meaning specified in Section 5.1.15(i).







 - 20 - 









 








          “Published Rate” shall mean the rate of interest published each Business Day in The
Wall Street Journal “Money Rates” listing under the caption “London Interbank Offered
Rates” for a one month period (or, if no such rate is published therein for any reason, then the
Published Rate shall be the rate at which U.S. dollar deposits are offered by leading banks in the
London interbank deposit market for a one month period as published in another publication selected
by the Administrative Agent); provided that, with respect to any day that is not a
Business Day, the “Published Rate” shall be the Published Rate on the immediately preceding
Business Day.




          “Ratable Share” shall mean the proportion that a Lender’s Commitment (excluding the
Swing Loan Commitment) bears to the Commitments (excluding the Swing Loan Commitment) of all of the
Lenders. If the Commitments have terminated or expired, the Ratable Shares shall be determined
based upon the Commitments (excluding the Swing Loan Commitment) most recently in effect, giving
effect to any assignments.




          “Regulation U” shall mean Regulation U of the Board as in effect from time to time.




          “Reimbursement Obligation” shall have the meaning specified in Section 2.8.3.1.




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




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




          “Reportable Events” shall mean any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty day notice period is waived under subsections .27, .28, .29, .30, .31, .32, .34, or .35 of PBGC Reg. § 4043.




          “Required Lenders” shall mean Lenders, excluding any Defaulting Lenders, having at
least 50.1% of the sum of the aggregate amount of the Revolving Credit Commitments of the Lenders
(excluding any Defaulting Lender) or, after the termination of the Revolving Credit Commitments, at
least 50.1% of the sum of the aggregate outstanding principal amount of the Revolving Credit Loans
and the Ratable Shares of the Lenders (excluding any Defaulting Lender) of the Letter of Credit
Obligations and the principal amount of the Swing Loans then outstanding; provided
that, at any time that there is at least two (2) Non-Defaulting Lenders, it shall take at
least two Non-Defaulting Lenders to constitute Required Lenders.




          “Required Share” shall have the meaning assigned to such term in Section 4.10.




          “Requirement of Law” shall mean as to any Person, the Certificate of Incorporation and
By-Laws or other organizational or governing documents of such Person, and any law, treaty, rule or
regulation or determination of any arbitrator or a court or any Official Body in each case
applicable to or binding upon such Person or any of its property or to which such Person or its
property is bound.







 - 21 - 









 








          “Restricted Payment” shall mean (i) any payment by Holdings, the Borrower or any of
its Subsidiaries of a dividend (other than a dividend payable solely in the same class of Capital
Stock of the Borrower or Holdings, as the case may be) on, or any payment on account of the
purchase, redemption or retirement of, or any other distribution on, any shares of any class of
Capital Stock of Holdings or the Borrower (including any such payment or distribution in cash or in
property or obligations of Holdings, the Borrower or any of its Subsidiaries), (ii) any loan or
advance by Holdings, the Borrower or any of its Subsidiaries to any Affiliate of Holdings or the
Borrower or (iii) the payment by Holdings, the Borrower or any of its Subsidiaries of any
management or administrative fee to any Affiliate of Holdings or the Borrower.




          “Revolving Credit Commitment” shall mean, as to any Lender at any time, the amount
initially set forth opposite its name on Schedule 1.1(B) in the column labeled “Amount of
Commitment for Revolving Credit Loans,” as such Commitment is thereafter assigned or modified and
“Revolving Credit Commitments” shall mean the aggregate Revolving Credit Commitments of all
of the Lenders.




          “Revolving Credit Loans” shall mean collectively and “Revolving Credit Loan”
shall mean separately all Revolving Credit Loans or any Revolving Credit Loan made by the Lenders
or one of the Lenders to the Borrower pursuant to Section 2.1 or 2.8.3.




          “Revolving Credit Notes” shall mean, collectively, the promissory notes substantially
in the form of Exhibit 1.1(N)(1) evidencing the Revolving Credit Loans, together with all
amendments, extensions, renewals, replacements, refinancings or refundings thereof in whole or in
part.




          “Revolving Facility Usage” shall mean at any time the sum of the outstanding principal
amount of the Revolving Credit Loans, the outstanding principal amount of the Swing Loans, and the
Letter of Credit Obligations.




          “SEC” shall mean the Securities and Exchange Commission, any successor thereto and any
analogous Official Body.




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




          “Settlement Date” shall mean the Business Day on which the Administrative Agent elects
to effect settlement pursuant Section 4.10.




          “Solvent” shall mean when used with respect to any Person, means that, as of
any date of determination, (i) the amount of the “present fair saleable value” of the assets of
such Person will, as of such date, exceed the amount of all “liabilities of such Person, contingent
or otherwise”, as of such date, as such quoted terms are determined in accordance with applicable
federal and state laws governing determinations of the insolvency of debtors, (ii) the present fair
saleable value of the assets of such Person will, as of such date, be greater than the amount that
will be required to pay the liability of such Person on its debts as such debts become absolute and
matured, (iii) such Person will not have, as of such date, an unreasonably small amount of capital






 - 22 - 









 







with which to conduct its business, and (iv) such Person will be able to pay its debts as they
mature. For purposes of this definition, (a) “debt” means liability on a “claim”, and (b) “claim”
means any (x) right to payment, whether or not such a right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable,
secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach
gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or unsecured.




          “Specified Capital Contribution” shall have the meaning specified in Section 8.3.




          “Sponsor Group” shall mean the collective reference to (i) MacAndrews & Forbes
Holdings Inc. and its direct and indirect Subsidiaries and Affiliates, (ii) Ronald O. Perelman,
(iii) any of the directors or executive officers of MacAndrews & Forbes Holdings Inc. and (iv) any
of their respective Permitted Transferees.




          “Standard & Poor’s” shall mean Standard & Poor’s Ratings Services, a division of The
McGraw-Hill Companies, Inc.




          “Subsidiary” of any Person at any time shall mean any corporation, trust, partnership,
any limited liability company or other business entity of which more than 50% of the outstanding
voting securities or other interests normally entitled to vote for the election of one or more
directors or trustees (regardless of any contingency which does or may suspend or dilute the voting
rights) is at such time owned directly or indirectly by such Person or one or more of such Person’s
Subsidiaries. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in
this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.




          “Swing Loan Commitment” shall mean PNC’s commitment to make Swing Loans to the
Borrower pursuant to Section 2.1.2 hereof in an aggregate principal amount up to $5,000,000.




          “Swing Line Collateral Account” shall have the meaning specified in Section
2.8.13(c)(iii).




          “Swing Loan Lender” shall mean PNC in its capacity as the lender of Swing Loans.




          “Swing Loan Note” shall mean the Swing Loan Note of the Borrower in the form of
Exhibit 1.1(N)(2) evidencing the Swing Loans, together with all amendments, extensions,
renewals, replacements, refinancings or refundings thereof in whole or in part.




          “Swing Loan Request” shall mean a request for Swing Loans made in accordance with
Section 2.4.2 hereof.




          “Swing Loans” shall mean collectively and Swing Loan shall mean separately all
Swing Loans or any Swing Loan made by PNC to the Borrower pursuant to Section 2.1.2 hereof.







 - 23 - 









 








          “Tax Agreement” shall mean the Tax Sharing Agreement, dated as of December 15, 2005,
by and among M & F Worldwide, Harland-Clarke Holdings Corp. (formerly known as Clarke American
Corp.) and PCT International Holdings Inc. and their respective Subsidiaries and any entities which
become parties thereto pursuant to the terms thereof.




          “Taxes” shall mean all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Official Body, including any
interest, additions to tax or penalties applicable thereto.




          “Total Debt” shall mean at any time, the sum (without duplication) of (i) the
aggregate principal amount of all outstanding Indebtedness of the Borrower and its Subsidiaries and
(ii) all outstanding Guarantee Obligations of the Borrower and its Subsidiaries in respect of
Indebtedness of Persons other than the Borrower or any of its Subsidiaries (including, without
limitation, all obligations of the Borrower and its Subsidiaries, contingent or otherwise, as an
account party or applicant under or in respect of acceptances, letters of credit, surety bonds or
similar arrangements).




          “UCC” shall mean the Uniform Commercial Code as from time to time in effect in the
State of New York.




          “UCP” shall have the meaning specified in Section 10.11.1.




          “Undrawn L/C Obligations” shall mean the portion, if any, of the Payment Obligations
consisting of the contingent obligation of the Borrower to reimburse the Issuing Lender in respect
of the then undrawn and unexpired portions of the Letters of Credit issued by the Issuing Lender
pursuant to Section 2.8.




          “USA Patriot Act” shall mean the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56, as
the same has been, or shall hereafter be, renewed, extended, amended or replaced.




          “Wholly Owned Subsidiary” shall mean as to any Person, any other Person all of the
Capital Stock of which (other than directors’ qualifying shares required by law) is owned by such
Person directly and/or through other Wholly Owned Subsidiaries.




     1.2 Construction. Unless the context of this Agreement otherwise clearly requires,
the following rules of construction shall apply to this Agreement and each of the other Loan
Documents: (i) references to the plural include the singular, the plural, the part and the whole
and the words “include,” “includes” and “including” shall be deemed to be followed by the phrase
“without limitation”; (ii) the words “hereof,” “herein,” “hereunder,” “hereto” and similar terms in
this Agreement or any other Loan Document refer to this Agreement or such other Loan Document as a
whole; (iii) article, section, subsection, clause, schedule and exhibit references are to this
Agreement or other Loan Document, as the case may be, unless otherwise specified; (iv) reference to
any Person includes such Person’s successors and assigns; (v) reference to any agreement, including
this Agreement and any other Loan Document together with the schedules and exhibits hereto or
thereto, document or instrument means such agreement, document or instrument as amended, modified,
replaced, substituted for, superseded or restated; (vi) relative






 - 24 - 









 







to the determination of any period of time, “from” means “from and including,” “to” means “to
but excluding,” and “through” means “through and including”; (vii) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and contract rights, (viii)
section headings herein and in each other Loan Document are included for convenience and shall not
affect the interpretation of this Agreement or such Loan Document, and (ix) unless otherwise
specified, all references herein to times of day shall be references to Eastern Time.




     1.3 Accounting Principles. Except as otherwise expressly provided herein, all terms
of an accounting or financial nature used herein shall be construed in accordance with GAAP as in
effect from time to time; provided that if the Borrower, by notice to the Administrative
Agent, shall request an amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the operation of such
provision (or if the Administrative Agent or the Required Lenders, by notice to the Borrower, shall
request an amendment to any provision hereof for such purpose), regardless of whether any such
notice is given before or after such change in GAAP or in the application thereof, then (i) the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such
provision to preserve the original intent thereof in light of such change in GAAP (subject to the
approval of the Borrower and the Required Lenders) and (ii) such provision shall be interpreted on
the basis of GAAP as in effect and applied immediately before such change shall have become
effective until such notice shall have been withdrawn or such provision amended in accordance
herewith, and the Borrower shall provide to the Administrative Agent, when it delivers its
financial statements pursuant to any provision hereof, such reconciliation statements as shall be
reasonably requested by the Administrative Agent.



2. REVOLVING CREDIT AND SWING LOAN FACILITIES




     2.1 Revolving Credit Commitments.



          2.1.1 Revolving Credit Loans. Subject to the terms and conditions hereof and relying
upon the representations and warranties herein set forth, each Lender severally agrees to make
Revolving Credit Loans to the Borrower at any time or from time to time on or after the date hereof
to the Expiration Date; provided that after giving effect to each such Loan (i) the aggregate
principal amount of Revolving Credit Loans from such Lender shall not exceed such Lender’s
Revolving Credit Commitment minus the aggregate amount of such Lender’s Ratable Share of the Letter
of Credit Obligations and the principal amount of the Swing Loans then outstanding and (ii) the
Revolving Facility Usage shall not exceed the Revolving Credit Commitments. Within such limits of
time and amount and subject to the other provisions of this Agreement, the Borrower may borrow,
repay and reborrow pursuant to this Section 2.1.




          2.1.2 Swing Loan Commitment. Subject to the terms and conditions hereof and relying
upon the representations and warranties herein set forth, and in order to facilitate loans and
repayments between Settlement Dates, PNC may, at its option, cancelable at any time for any reason
whatsoever, make swing loans (the “Swing Loans”) to the Borrower at any time or from time to time
after the date hereof to, but not including, the Expiration Date, in an aggregate principal amount
up to but not in excess of the Swing Loan Commitment; provided that after






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giving effect to such Loan, the Revolving Facility Usage shall not exceed the Revolving Credit
Commitments. Within such limits of time and amount and subject to the other provisions of this
Agreement, the Borrower may borrow, repay and reborrow pursuant to this Section 2.1.2 .




     2.2 Nature of Lenders’ Obligations with Respect to Revolving Credit Loans. Each
Lender shall be obligated to participate in each request for Revolving Credit Loans pursuant to
Section 2.4 in accordance with its Ratable Share. The aggregate principal amount of each Lender’s
Revolving Credit Loans outstanding hereunder to the Borrower at any time shall never exceed its
Revolving Credit Commitment minus its Ratable Share of the sum of (i) the principal amount of the
Swing Loans then outstanding and (ii) the Letter of Credit Obligations at such time. The
obligations of each Lender hereunder are several. The failure of any Lender to perform its
obligations hereunder shall not affect the obligation of the Borrower to any other party nor shall
any other party be liable for the failure of such Lender to perform its obligations hereunder. The
Lenders shall have no obligation to make Revolving Credit Loans hereunder on or after the
Expiration Date.



     2.3 Commitment Fees. Accruing from the date hereof until the Expiration Date, the
Borrower agrees to pay to the Administrative Agent for the account of each Lender according to its
Ratable Share, a nonrefundable commitment fee (the “Commitment Fee”) equal to the Applicable
Commitment Fee Rate (computed on the basis of a year of 360 days and actual days elapsed)
multiplied by the average daily difference between the amount of (i) the Revolving Credit
Commitments (for purposes of this computation, PNC’s Swing Loans shall be deemed to be borrowed
amounts under its Revolving Credit Commitment) and (ii) the Revolving Facility Usage. All
Commitment Fees shall be payable in arrears on each Payment Date.



     2.4 Revolving Credit Loan Requests; Swing Loan Requests.



          2.4.1 Revolving Credit Loan Requests. The Borrower may from time to time prior to the
Expiration Date request the Lenders to make Revolving Credit Loans, or renew or convert the
Interest Rate Option applicable to existing Revolving Credit Loans pursuant to Section 3.2, by
delivering to the Administrative Agent, not later than 10:00 a.m., (i) three (3) Business Days
prior to the proposed Borrowing Date with respect to the making of Revolving Credit Loans to which
the LIBOR Rate Option applies or the conversion to or the renewal of the LIBOR Rate Option for any
Loans; and (ii) the same Business Day of the proposed Borrowing Date with respect to the making of
a Revolving Credit Loan to which the Base Rate Option applies or the last day of the preceding
Interest Period with respect to the conversion to the Base Rate Option for any Loan, of a duly
completed request therefor substantially in the form of Exhibit 2.4.1 or a request by
telephone immediately confirmed in writing by letter, facsimile or telex in such form (each, a
“Loan Request”), it being understood that the Administrative Agent may rely on the authority of any
individual making such a telephonic request without the necessity of receipt of such written
confirmation. Any Revolving Credit Loans made on the Closing Date shall be Loans to which the Base
Rate Option applies. Each Loan Request shall be irrevocable and shall specify the aggregate amount
of the proposed Loans comprising each Borrowing Tranche, and, if applicable, the Interest Period,
which amounts shall be in (x) integral multiples of $100,000 and not less than $1,000,000 for each
Borrowing Tranche under the LIBOR Rate Option, and (y) integral multiples of $1,000,000 and not
less than $100,000 for each Borrowing Tranche under the Base Rate Option (or, if the then aggregate
amount available






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for borrowing under the Revolving Credit Commitments is less than $1,000,000, such lesser
amount).




          2.4.2 Swing Loan Requests. The Borrower may from time to time prior to the Expiration
Date request PNC to make Swing Loans by delivery to PNC not later than 12:00 noon on the proposed
Borrowing Date of a duly completed request therefor substantially in the form of Exhibit
2.4.2 hereto or a request by telephone immediately confirmed in writing by letter, facsimile
or telex (each, a “Swing Loan Request”), it being understood that the Administrative Agent may rely
on the authority of any individual making such a telephonic request without the necessity of
receipt of such written confirmation. Each Swing Loan Request shall be irrevocable and shall
specify the proposed Borrowing Date and the principal amount of such Swing Loan, which shall be in
integral multiples of $100,000 and not less than $100,000. In addition to making Swing Loans
pursuant to the provisions specified herein, without the requirement for a specific request from
the Borrower, PNC may make Swing Loans to the Borrower in accordance with the provisions of any
agreements between the Borrower and PNC relating to the Borrower’s deposit, sweep and other
accounts at PNC and related arrangements and agreements regarding the management and investment of
the Borrower’s cash assets that are satisfactory to the Administrative Agent and PNC (individually
and collectively, the “Cash Management Agreement”) to the extent of the daily aggregate net
negative balance in the Borrower’s accounts which are subject to the provisions of the Cash
Management Agreement. Swing Loans made in accordance with the provisions of the Cash Management
Agreement shall (i) be subject to the limitations as to aggregate amount of Swing Loans set forth
herein, (ii) not be subject to the limitations as to individual amount set forth herein, (iii) be
payable by the Borrower, both as to principal and interest, at the times set forth in the Cash
Management Agreement (but in no event later than the Expiration Date), (iv) not be made at any time
after the Required Lenders shall have notified PNC (with a copy to the Administrative Agent) in
writing that, as a result of one or more events or circumstances described in such notice, one or
more of the conditions precedent set forth in Section 6.2(i) or (ii) would not be satisfied if such
Swing Loan were then made (unless PNC shall be satisfied in its sole discretion that the events and
circumstances described in such notice shall have been cured or otherwise shall have ceased to
exist), and (v) if not repaid by the Borrower in accordance with the provisions of the Cash
Management Agreement, shall be subject to each Lender’s obligations hereunder with respect to Swing
Loans, including without limitation under Section 2.5.5. If the Cash Management Agreement is in
effect, Swing Loans shall only be made pursuant to the Cash Management Agreement.




     2.5 Making Revolving Credit Loans and Swing Loans; Presumptions by the Administrative
Agent; Repayment of Revolving Credit Loans; Borrowings to Repay Swing Loans.



          2.5.1 Making Revolving Credit Loans. The Administrative Agent shall, promptly after
receipt by it of a Loan Request pursuant to Section 2.4, notify the Lenders of its receipt of such
Loan Request specifying the information provided by the Borrower and the apportionment among the
Lenders of the requested Revolving Credit Loans as determined by the Administrative Agent in
accordance with Section 2.2. Each Lender shall remit the principal amount of each Revolving Credit
Loan to the Administrative Agent such that the Administrative Agent is able to, and the
Administrative Agent shall, to the extent the Lenders have made funds available to it for such
purpose and subject to Section 6.2, fund such Revolving Credit Loans to






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the Borrower in U.S. Dollars and immediately available funds at the Principal Office prior to
2:00 p.m., on the applicable Borrowing Date; provided that if any Lender fails to remit such funds
to the Administrative Agent in a timely manner, the Administrative Agent may elect in its sole
discretion to fund with its own funds the Revolving Credit Loans of such Lender on such Borrowing
Date, and such Lender shall be subject to the repayment obligation in Section 2.5.2 .




          2.5.2 Presumptions by the Administrative Agent. Unless the Administrative Agent shall
have received notice from a Lender prior to the proposed date of any Loan that such Lender will not
make available to the Administrative Agent such Lender’s share of such Loan, the Administrative
Agent may assume that such Lender has made such share available on such date in accordance with
Section 2.5.1 and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share of the applicable
Loan available to the Administrative Agent, then the applicable Lender and the Borrower severally
agree to pay to the Administrative Agent forthwith on demand such corresponding amount with
interest thereon, for each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of a
payment to be made by such Lender, the greater of the Federal Funds Effective Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules on interbank
compensation and (ii) in the case of a payment to be made by the Borrower, the interest rate
applicable to Loans under the Base Rate Option. If such Lender pays its share of the applicable
Loan to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan. Any
payment by the Borrower shall be without prejudice to any claim the Borrower may have against a
Lender that shall have failed to make such payment to the Administrative Agent.




          2.5.3 Making Swing Loans. So long as PNC elects to make Swing Loans, PNC shall, after
receipt by it of a Swing Loan Request pursuant to Section 2.4.2 , fund such Swing Loan to the
Borrower in U.S. Dollars and immediately available funds at the Principal Office prior to 4:00
o’clock p.m. on the Borrowing Date.




          2.5.4 Repayment of Revolving Credit Loans. The Borrower shall repay the Revolving
Credit Loans together with all outstanding interest thereon on the Expiration Date.




          2.5.5 Borrowings to Repay Swing Loans. PNC may, at its option, exercisable at any
time for any reason whatsoever, demand repayment of the Swing Loans, and each Lender shall make a
Revolving Credit Loan in an amount equal to (or otherwise acquire a participation interest in the
Swing Loans in an amount equal to) such Lender’s Ratable Share of the aggregate principal amount of
the outstanding Swing Loans, plus, if PNC so requests, accrued interest thereon. Revolving Credit
Loans made pursuant to the preceding sentence shall bear interest at the Base Rate Option and shall
be deemed to have been properly requested in accordance with Section 2.4.1 without regard to any
of the requirements of that provision, including whether a Potential Default or Event of Default
exists (including under Section 8.1.6). PNC shall provide notice to the Lenders (which may be
telephonic or written notice by letter, facsimile or telex) that such Revolving Credit Loans are to
be made under this Section 2.5.5 and of the apportionment among the Lenders, and the Lenders shall
be unconditionally obligated to fund such Revolving Credit Loans (whether or not the conditions
specified in Section 2.4.1 are then satisfied) by the






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time PNC so requests, which shall not be earlier than 3:00 p.m. on the Business Day next after
the date the Lenders receive such notice from PNC.




     2.6 Notes. The Obligation of the Borrower to repay the aggregate unpaid principal
amount of the Revolving Credit Loans and Swing Loans made to it by each Lender, together with
interest thereon, shall be evidenced by a Revolving Credit Note and a Swing Loan Note, dated the
Closing Date payable to the order of such Lender in a face amount equal to the Revolving Credit
Commitment or Swing Loan Commitment, as applicable, of such Lender.



     2.7 Use of Proceeds. The proceeds of the Loans shall be used (i) for financing advances
to fund raw material collections and raw material collection operations, (ii) to make Restricted
Payments, (iii) to refinance the Indebtedness under the Existing Credit Agreement, (iv) for
Permitted Acquisitions, (v) for investments in joint venture operations, (vi) for acquisitions of
manufacturing technology, licenses and other intellectual property, (vii) to pay certain fees and
expenses incurred in connection with the consummation of the transactions contemplated hereby and
(viii) for working capital and general corporate purposes of the Borrower and its Subsidiaries, in
each case, subject to the terms and conditions hereof.



     2.8 Letter of Credit Subfacility.



          2.8.1 Issuance of Letters of Credit. The Borrower may at any time prior to the
Expiration Date request the issuance of a letter of credit hereunder (each a “Letter of Credit”) on
behalf of itself, another Loan Party or its Subsidiaries, or the amendment or extension of an
existing Letter of Credit, by delivering or having such other Loan Party deliver to the Issuing
Lender (with a copy to the Administrative Agent) a completed application and agreement for letters
of credit, or request for such amendment or extension, as applicable, in such form as the Issuing
Lender may specify from time to time by no later than 10:00 a.m. at least five (5) Business Days,
or such shorter period as may be agreed to by the Issuing Lender, in advance of the proposed date
of issuance. Each Letter of Credit shall be a standby letter of credit or a commercial letter of
credit. Promptly after receipt of any letter of credit application, the Issuing Lender shall
confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent
has received a copy of such Letter of Credit application and if not, such Issuing Lender will
provide Administrative Agent with a copy thereof. Unless the Issuing Lender has received notice
from any Lender, the Administrative Agent or any Loan Party, at least one day prior to the
requested date of issuance, amendment or extension of the applicable Letter of Credit, that one or
more applicable conditions in Section 6.2 is not satisfied, then, subject to the terms and
conditions hereof and in reliance on the agreements of the other Lenders set forth in this
Section 2.8, the Issuing Lender will issue a Letter of Credit or agree to such amendment or
extension, provided that each Letter of Credit shall (A) have a maximum maturity of twelve (12)
months from the date of issuance, and (B) in no event expire later than five (5) Business Days
prior to the Expiration Date and provided further that in no event shall (i) the Letter of Credit
Obligations exceed, at any one time, $5,000,000 (the “Letter of Credit Sublimit”) or (ii) the
Revolving Facility Usage exceed, at any one time, the Revolving Credit Commitments.
Notwithstanding the foregoing, any Letter of Credit may contain customary automatic renewal
provisions agreed upon by the Borrower and the Issuing Lender pursuant to which the expiration date
of such Letter of Credit shall automatically be extended for a period of up to 12 months (but not
to a date later than the date set forth in clause (B) above), subject to a right on the part of the






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Issuing Lender to prevent any such renewal from occurring by giving notice to the beneficiary
in advance of any such renewal; provided that (I) the initial expiration date (or
any subsequent expiration date) of each such Letter of Credit is not later than five (5) Business
Days prior to the Expiration Date, and (II) renewal of such Letter(s) of Credit, at the Issuing
Bank’s discretion, shall be available upon written request from the Borrower to the Issuing Bank at
least thirty (30) days (or such other time period as agreed by the Borrower and the Issuing Bank)
before the date upon which notice of renewal is otherwise required. Each request by the Borrower
for the issuance, amendment or extension of a Letter of Credit shall be deemed to be a
representation by the Borrower that it shall be in compliance with the preceding sentence and with
Section 6.2 after giving effect to the requested issuance, amendment or extension of such Letter of
Credit. Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit
to the beneficiary thereof, the applicable Issuing Lender will also deliver to the Borrower and the
Administrative Agent a true and complete copy of such Letter of Credit or amendment.




          2.8.2 Letter of Credit Fees. The Borrower shall pay (i) to the Administrative Agent
for the ratable account of the Lenders a fee (the “Letter of Credit Fee”) equal to the Applicable
Letter of Credit Fee Rate, and (ii) to the Issuing Lender for its own account a fronting fee equal
to 0.25% per annum (in each case computed on the basis of a year of 360 days and actual days
elapsed), which fees shall be computed on the daily average undrawn face amount of each Letter of
Credit and shall be payable quarterly in arrears on each Payment Date following issuance of each
Letter of Credit. The Borrower shall also pay to the Issuing Lender for the Issuing Lender’s sole
account the Issuing Lender’s then in effect customary fees and administrative expenses payable with
respect to the Letters of Credit as the Issuing Lender may generally charge or incur from time to
time in connection with the issuance, maintenance, amendment (if any), assignment or transfer (if
any), negotiation, and administration of Letters of Credit.




          2.8.3 Disbursements, Reimbursement. Immediately upon the issuance of each Letter of
Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the Issuing Lender a participation in such Letter of Credit and each drawing
thereunder in an amount equal to such Lender’s Ratable Share of the maximum amount available to be
drawn under such Letter of Credit and the amount of such drawing, respectively.




               2.8.3.1 In the event of any request for a drawing under a Letter of Credit by the beneficiary
or transferee thereof, the Issuing Lender will promptly notify the Borrower and the Administrative
Agent thereof. Provided that it shall have received such notice, the Borrower shall reimburse
(such obligation to reimburse the Issuing Lender shall sometimes be referred to as a “Reimbursement
Obligation”) the Issuing Lender prior to 12:00 noon on each date that an amount is paid by the
Issuing Lender under any Letter of Credit (each such date, a “Drawing Date”) by paying to the
Administrative Agent for the account of the Issuing Lender an amount equal to the amount so paid by
the Issuing Lender. In the event the Borrower fails to reimburse the Issuing Lender (through the
Administrative Agent) for the full amount of any drawing under any Letter of Credit by 12:00 noon
on the Drawing Date, the Administrative Agent will promptly notify each Lender thereof, and the
Borrower shall be deemed to have requested that Revolving Credit Loans be made by the Lenders under
the Base Rate Option in an aggregate principal amount equal to such unreimbursed amount to be
disbursed on such Drawing Date, subject to the amount of the unutilized portion of the Revolving
Credit Commitment then



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in effect and subject to the conditions set forth in Section 6.2 other than any notice
requirements. Any notice given by the Administrative Agent or Issuing Lender pursuant to this
Section 2.8.3.1 may be oral if immediately confirmed in writing; provided that the lack of such an
immediate confirmation shall not affect the conclusiveness or binding effect of such notice.




               2.8.3.2 Each Lender shall upon any notice pursuant to Section 2.8.3.1 make available to the
Administrative Agent for the account of the Issuing Lender an amount in immediately available funds
equal to its Ratable Share of the amount of the drawing, whereupon the participating Lenders shall
(subject to this Section 2.8.3) each be deemed to have made a Revolving Credit Loan under the Base
Rate Option to the Borrower in that amount. If any Lender so notified fails to make available to
the Administrative Agent for the account of the Issuing Lender the amount of such Lender’s Ratable
Share of such amount by no later than 2:00 p.m. on the Drawing Date, then interest shall accrue on
such Lender’s obligation to make such payment, from the Drawing Date to the date on which such
Lender makes such payment (i) at a rate per annum equal to the Federal Funds Effective Rate during
the first three (3) days following the Drawing Date and (ii) at a rate per annum equal to the rate
applicable to Loans under the Revolving Credit Base Rate Option on and after the fourth day
following the Drawing Date. The Administrative Agent and the Issuing Lender will promptly give
notice (as described in Section 2.8.3.1 above) of the occurrence of the Drawing Date, but failure
of the Administrative Agent or the Issuing Lender to give any such notice on the Drawing Date or in
sufficient time to enable any Lender to effect such payment on such date shall not relieve such
Lender from its obligation under this Section 2.8.3.2.



               2.8.3.3 With respect to any unreimbursed drawing that is not converted into Revolving Credit
Loans under the Base Rate Option to the Borrower in whole or in part as contemplated by
Section 2.8.3.1, because of the Borrower’s failure to satisfy the conditions set forth in
Section 6.2 (other than any notice requirements), or for any other reason, the Borrower shall be
deemed to have incurred from the Issuing Lender a borrowing (each a “Letter of Credit Borrowing”)
in the amount of such drawing. Such Letter of Credit Borrowing shall be due and payable on demand
(together with interest) and shall bear interest at the rate per annum applicable to the Loans
under the Base Rate Option. Each Lender’s payment to the Administrative Agent for the account of
the Issuing Lender pursuant to Section 2.8.3 shall be deemed to be a payment in respect of its
participation in such Letter of Credit Borrowing (each a “Participation Advance”) from such Lender
in satisfaction of its participation obligation under this Section 2.8.3.



          2.8.4 Repayment of Participation Advances.




               2.8.4.1 Upon (and only upon) receipt by the Administrative Agent for the account of the
Issuing Lender of immediately available funds from the Borrower (i) in reimbursement of any payment
made by the Issuing Lender under the Letter of Credit with respect to which any Lender has made a
Participation Advance to the Administrative Agent, or (ii) in payment of interest on such a payment
made by the Issuing Lender under such a Letter of Credit, the Administrative Agent on behalf of the
Issuing Lender will pay to each Lender, in the same funds as those received by the Administrative
Agent, the amount of such Lender’s Ratable Share of such funds, except the Administrative Agent
shall retain for the account of the Issuing



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Lender the amount of the Ratable Share of such funds of any Lender that did not make a
Participation Advance in respect of such payment by the Issuing Lender.




               2.8.4.2 If the Administrative Agent is required at any time to return to any Loan Party, or to
a trustee, receiver, liquidator, custodian, or any official in any Insolvency Proceeding, any
portion of any payment made by any Loan Party to the Administrative Agent for the account of the
Issuing Lender pursuant to this Section in reimbursement of a payment made under the Letter of
Credit or interest or fee thereon, each Lender shall, on demand of the Administrative Agent,
forthwith return to the Administrative Agent for the account of the Issuing Lender the amount of
its Ratable Share of any amounts so returned by the Administrative Agent plus interest thereon from
the date such demand is made to the date such amounts are returned by such Lender to the
Administrative Agent, at a rate per annum equal to the Federal Funds Effective Rate in effect from
time to time.



          2.8.5 Documentation. Each Loan Party agrees to be bound by the terms of the Issuing
Lender’s application and agreement for letters of credit and the Issuing Lender’s written
regulations and customary practices relating to letters of credit, though such interpretation may
be different from such Loan Party’s own. In the event of a conflict between such application or
agreement and this Agreement, this Agreement shall govern. It is understood and agreed that,
except in the case of gross negligence or willful misconduct, the Issuing Lender shall not be
liable for any error, negligence and/or mistakes, whether of omission or commission, in following
any Loan Party’s instructions or those contained in the Letters of Credit or any modifications,
amendments or supplements thereto.




          2.8.6 Determinations to Honor Drawing Requests. In determining whether to honor any
request for drawing under any Letter of Credit by the beneficiary thereof, the Issuing Lender shall
be responsible only to determine that the documents and certificates required to be delivered under
such Letter of Credit have been delivered and that they comply on their face with the requirements
of such Letter of Credit.




          2.8.7 Nature of Participation and Reimbursement Obligations. Each Lender’s obligation
in accordance with this Agreement to make the Revolving Credit Loans or Participation Advances, as
contemplated by Section 2.8.3, as a result of a drawing under a Letter of Credit, and the
obligation of the Borrower to reimburse the Issuing Lender upon a draw under a Letter of Credit,
shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Section 2.8 under all circumstances, including the following circumstances:




          (i) any set-off, counterclaim, recoupment, defense or other right which such Lender may have
against the Issuing Lender or any of its Affiliates, the Borrower or any other Person for any
reason whatsoever, or which any Loan Party may have against the Issuing Lender or any of its
Affiliates, any Lender or any other Person for any reason whatsoever;




          (ii) the failure of any Loan Party or any other Person to comply, in connection with a Letter
of Credit Borrowing, with the conditions set forth in Sections 2.1, 2.4, 2.5 or 6.2 or as otherwise
set forth in this Agreement for the making of a Revolving Credit Loan, it being acknowledged that
such conditions are not required for the making of a Letter of Credit






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Borrowing and the obligation of the Lenders to make Participation Advances under
Section 2.8.3;




          (iii) any lack of validity or enforceability of any Letter of Credit;




          (iv) any claim of breach of warranty that might be made by any Loan Party or any Lender
against any beneficiary of a Letter of Credit, or the existence of any claim, set-off, recoupment,
counterclaim, crossclaim, defense or other right which any Loan Party or any Lender may have at any
time against a beneficiary, successor beneficiary any transferee or assignee of any Letter of
Credit or the proceeds thereof (or any Persons for whom any such transferee may be acting), the
Issuing Lender or its Affiliates or any Lender or any other Person, whether in connection with this
Agreement, the transactions contemplated herein or any unrelated transaction (including any
underlying transaction between any Loan Party or Subsidiaries of a Loan Party and the beneficiary
for which any Letter of Credit was procured);




          (v) the lack of power or authority of any signer of (or any defect in or forgery of any
signature or endorsement on) or the form of or lack of validity, sufficiency, accuracy,
enforceability or genuineness of any draft, demand, instrument, certificate or other document
presented under or in connection with any Letter of Credit, or any fraud or alleged fraud in
connection with any Letter of Credit, or the transport of any property or provision of services
relating to a Letter of Credit, in each case even if the Issuing Lender or any of its Affiliates
has been notified thereof;




          (vi) payment by the Issuing Lender or any of its Affiliates under any Letter of Credit against
presentation of a demand, draft or certificate or other document which does not comply with the
terms of such Letter of Credit;




          (vii) the solvency of, or any acts or omissions by, any beneficiary of any Letter of Credit,
or any other Person having a role in any transaction or obligation relating to a Letter of Credit,
or the existence, nature, quality, quantity, condition, value or other characteristic of any
property or services relating to a Letter of Credit;




          (viii) any failure by the Issuing Lender or any of its Affiliates to issue any Letter of
Credit in the form requested by any Loan Party, unless the Issuing Lender has received written
notice from such Loan Party of such failure within three Business Days after the Issuing Lender
shall have furnished such Loan Party and the Administrative Agent a copy of such Letter of Credit
and such error is material and no drawing has been made thereon prior to receipt of such notice;




          (ix) any adverse change in the business, operations, properties, assets, condition (financial
or otherwise) or prospects of any Loan Party or Subsidiaries of a Loan Party;




          (x) any breach of this Agreement or any other Loan Document by any party thereto;




          (xi) the occurrence or continuance of an Insolvency Proceeding with respect to any Loan Party;



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          (xii) the fact that an Event of Default or a Potential Default shall have occurred and be
continuing;




          (xiii) the fact that the Expiration Date shall have passed or this Agreement or the
Commitments hereunder shall have been terminated; and




          (xiv) any other circumstance or happening whatsoever, whether or not similar to any of the
foregoing.




          2.8.8 Indemnity. The Borrower hereby agrees to protect, indemnify, pay and save
harmless the Issuing Lender from and against any and all claims, demands, liabilities, damages,
Indemnified Taxes, penalties, interest, judgments, losses, costs, charges and expenses (including
reasonable and documented out-of-pocket fees, expenses and disbursements of counsel) which the
Issuing Lender may incur or be subject to as a consequence, direct or indirect, of the issuance of
any Letter of Credit, other than as a result of (A) the gross negligence or willful misconduct of
the Issuing Lender as determined by a final non-appealable judgment of a court of competent
jurisdiction or (B) the wrongful dishonor by the Issuing Lender or any of Issuing Lender’s
Affiliates of a proper demand for payment made under any Letter of Credit, except if such dishonor
resulted from any act or omission, whether rightful or wrongful, of any present or future de jure
or de facto government or Official Body.




          2.8.9 Liability for Acts and Omissions. As between any Loan Party and the Issuing
Lender, or the Issuing Lender’s Affiliates, such Loan Party assumes all risks of the acts and
omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of such Letters
of Credit. In furtherance and not in limitation of the foregoing, the Issuing Lender shall not be
responsible for any of the following, including any losses or damages to any Loan Party or other
Person or property relating therefrom: (i) the form, validity, sufficiency, accuracy, genuineness
or legal effect of any document submitted by any party in connection with the application for an
issuance of any such Letter of Credit, even if it should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged (even if the Issuing Lender or its
Affiliates shall have been notified thereof); (ii) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any such 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) the failure of the beneficiary of any such Letter of
Credit, or any other party to which such Letter of Credit may be transferred, to comply fully with
any conditions required in order to draw upon such Letter of Credit or any other claim of any Loan
Party against any beneficiary of such Letter of Credit, or any such transferee, or any dispute
between or among any Loan Party and any beneficiary of any Letter of Credit or any such transferee;
(iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by
mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) errors in
interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any such Letter of Credit or of the proceeds
thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond
the control of the Issuing Lender or its Affiliates, as applicable, including any act or omission
of any Official Body, and none of the above shall affect or impair, or prevent the vesting of, any
of the Issuing Lender’s or its Affiliates rights or powers hereunder. Nothing






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in the preceding sentence shall relieve the Issuing Lender from liability for the Issuing
Lender’s gross negligence or willful misconduct in connection with actions or omissions described
in such clauses (i) through (viii) of such sentence. In no event shall the Issuing Lender or its
Affiliates be liable to any Loan Party for any indirect, consequential, incidental, punitive,
exemplary or special damages or expenses (including without limitation attorneys’ fees), or for any
damages resulting from any change in the value of any property relating to a Letter of Credit.




          Without limiting the generality of the foregoing, the Issuing Lender and each of its
Affiliates (i) may rely on any oral or other communication believed in good faith by the Issuing
Lender or such Affiliate to have been authorized or given by or on behalf of the applicant for a
Letter of Credit, (ii) may honor any presentation if the documents presented appear on their face
substantially to comply with the terms and conditions of the relevant Letter of Credit; (iii) may
honor a previously dishonored presentation under a Letter of Credit, whether such dishonor was
pursuant to a court order, to settle or compromise any claim of wrongful dishonor, or otherwise,
and shall be entitled to reimbursement to the same extent as if such presentation had initially
been honored, together with any interest paid by the Issuing Lender or its Affiliate; (iv) may
honor any drawing that is payable upon presentation of a statement advising negotiation or payment,
upon receipt of such statement (even if such statement indicates that a draft or other document is
being delivered separately), and shall not be liable for any failure of any such draft or other
document to arrive, or to conform in any way with the relevant Letter of Credit; (v) may pay any
paying or negotiating bank claiming that it rightfully honored under the laws or practices of the
place where such bank is located; and (vi) may settle or adjust any claim or demand made on the
Issuing Lender or its Affiliate in any way related to any order issued at the applicant’s request
to an air carrier, a letter of guarantee or of indemnity issued to a carrier or any similar
document (each an “Order”) and honor any drawing in connection with any Letter of Credit that is
the subject of such Order, notwithstanding that any drafts or other documents presented in
connection with such Letter of Credit fail to conform in any way with such Letter of Credit.




          In furtherance and extension and not in limitation of the specific provisions set forth above,
any action taken or omitted by the Issuing Lender or its Affiliates under or in connection with the
Letters of Credit issued by it or any documents and certificates delivered thereunder, if taken or
omitted in good faith, shall not put the Issuing Lender or its Affiliates under any resulting
liability to the Borrower or any Lender.




          2.8.10 Issuing Lender Reporting Requirements. Each Issuing Lender shall, on the first
Business Day of each month, provide to Administrative Agent and Borrower a schedule of the Letters
of Credit issued by it, in form and substance satisfactory to Administrative Agent, showing the
date of issuance of each Letter of Credit, the account party, the original face amount (if any),
and the expiration date of any Letter of Credit outstanding at any time during the preceding month,
and any other information relating to such Letter of Credit that the Administrative Agent may
request.




          2.8.11 Reduction of Revolving Credit Commitment. The Borrower shall have the right at
any time after the Closing Date upon five (5) days’ prior written notice to the Administrative
Agent to permanently reduce (ratably among the Lenders in proportion to their Ratable Shares) the
Revolving Credit Commitments, in a minimum amount of $2,000,000 and whole multiples of $100,000, or
to terminate completely the Revolving Credit Commitments,






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without penalty or premium; provided that any such reduction or termination shall be
accompanied by prepayment of the Revolving Credit Loans, Swing Loans, Reimbursement Obligations,
Letter of Credit Borrowings and/or cash collateral with respect to any outstanding Letters of
Credit, as the case may be, together with accrued and unpaid Commitment Fees, and the full amount
of interest accrued on the principal sum to be prepaid (and all amounts referred to in Section 4.9
hereof) to the extent necessary to cause the aggregate Revolving Facility Usage after giving effect
to such prepayments to be equal to or less than the Revolving Credit Commitments as so reduced or
terminated. Any notice to reduce the Revolving Credit Commitments under this Section 2.8.11 shall
be irrevocable; provided that a notice of termination of the Revolving Credit Commitments in full
delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other
credit facilities or debt or equity issuances, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if
such condition is not satisfied.




          2.8.12 Commercial Letters of Credit. In connection with all Letters of Credit issued
or caused to be issued by the Issuing Lender under this Agreement, the Borrower hereby appoints
PNC, or its designee, as its attorney, with full power and authority if and solely for so long as
an Event of Default shall have occurred and be continuing (i) to sign and/or endorse the Borrower’s
name upon any warehouse or other receipts, letter of credit applications and acceptances, (ii) to
sign the Borrower’s name on bills of lading, (iii) to clear inventory through the United States of
America Customs Department (“Customs”) in the name of the Borrower or PNC or PNC’s designee, and to
sign and deliver to Customs officials powers of attorney in the name of the Borrower for such
purpose and (iv) to complete in the Borrower’s name or PNC’s, or in the name of PNC’s designee, any
order, sale or transaction, obtain the necessary documents in connection therewith, and collect the
proceeds thereof. Neither PNC nor its attorneys will be liable for any acts or omissions or for
any error of judgment or mistakes of fact or law, except for PNC’s or its attorney’s gross
negligence or willful misconduct. This power, being coupled with an interest, is irrevocable as
long as any Letters of Credit remain outstanding.




          2.8.13 Defaulting Lenders. Notwithstanding any provision of this Agreement to the
contrary (including Sections 2.3 and 2.8.2), if any Lender becomes a Defaulting Lender, then the
following provisions shall apply for so long as such Lender is a Defaulting Lender:




          (i) such Defaulting Lender shall no longer be entitled to receive its Ratable Share of
Commitment Fees or Letter of Credit Fees otherwise payable pursuant to Sections 2.3 or 2.8.2
hereof, and thereafter, so long as any Lender is a Defaulting Lender, the fees payable to the
Non-Defaulting Lenders pursuant to Section 2.3 shall be based on their Adjusted Ratable Shares;
provided that (a) if a Letter of Credit Collateral Account is maintained pursuant to Section
2.8.13(iii)(D) and fully cash collateralized pursuant to Section 2.8.13(iii), the Borrower shall
not be required to pay any fees pursuant to Section 2.8.2 with respect to the unallocated portion
of such Defaulting Lender’s Ratable Share of all Letter of Credit Obligations, and (b) if any
Defaulting Lender’s Ratable Share of the Letter of Credit Obligations is neither reallocated nor
fully cash collateralized pursuant to Section 2.8.13(iii), then without prejudice to any rights or
remedies of the Issuing Lender or any Lender hereunder, all fees payable under Section 2.8.2 with
respect thereto shall be payable to the Issuing Lender until such Defaulting Lender’s Ratable Share
of the Letter of Credit Obligations is reallocated and/or cash collateralized to the extent
required pursuant to Section 2.8.13(iii);







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          (ii) [Intentionally Omitted];




          (iii) if any outstanding Swing Loans or Letters of Credit exist at the time a Lender becomes a
Defaulting Lender, then:




               (A) such Defaulting Lender’s pro rata portion of such Swing Loans shall be reallocated among
the Non-Defaulting Lenders in accordance with their respective Adjusted Ratable Shares but only to
the extent (I) the sum of (a) the aggregate principal amount of all outstanding Revolving Credit
Loans of all Non-Defaulting Lenders then outstanding plus (b) all Non-Defaulting Lenders’ Adjusted
Ratable Shares of (x) the aggregate principal amount of all outstanding Swing Loans then
outstanding plus (y) the Letter of Credit Obligations at such time does not exceed the aggregate
amount of the Revolving Credit Commitments of all Non-Defaulting Lenders at such time and (II) the
conditions set forth in Section 6.2(i) and (ii) are satisfied at such time;



               (B) such Defaulting Lender’s participation interests in such outstanding Letters of Credit
shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Adjusted
Ratable Shares but only to the extent (I) the sum of (a) the aggregate principal amount of all
outstanding Revolving Credit Loans of all Non-Defaulting Lenders then outstanding plus (b) all
Non-Defaulting Lenders’ Adjusted Ratable Shares of (x) the aggregate principal amount of all
outstanding Swing Loans then outstanding plus (y) the Letter of Credit Obligations at such time
does not exceed the aggregate amount of the Revolving Credit Commitments of all Non-Defaulting
Lenders at such time and (II) the conditions set forth in Section 6.2(i) and (ii) are satisfied at
such time;



               (C) to the extent that all or any part of such Defaulting Lender’s pro rata portion of Swing
Loans cannot be reallocated pursuant to Section 2.8.13(iii)(A), then the Borrower shall (I) within
15 days following notice from the Administrative Agent until such Defaulting Lender ceases to be a
Defaulting Lender under this Agreement, establish and, thereafter, maintain a special collateral
account (the “Swing Line Collateral Account”) with the Administrative Agent, in the name of the
Borrower but under the sole dominion and control of the Administrative Agent, (II) grant to the
Administrative Agent for the benefit of the Swing Loan Lender and the other Lenders, solely as
security for repayment of the unallocated portion of such Defaulting Lender’s Ratable Share of
outstanding Swing Loans, a security interest in and to the Swing Line Collateral Account and any
funds that may thereafter be deposited therein and (III) maintain in the Swing Line Collateral
Account an amount equal to the unallocated portion of such Defaulting Lender’s Ratable Share of
outstanding Swing Loans; and



               (D) to the extent that all or any part of such Defaulting Lender’s participations in
outstanding Letters of Credit cannot be reallocated pursuant to Section 2.8.13(iii)(B), then the
Borrower shall (I) within 15 days following notice from the Administrative Agent until such
Defaulting Lender ceases to be a Defaulting Lender under this Agreement, establish and, thereafter,
maintain a special collateral account (the “Letter of Credit Collateral Account”) with the
Administrative Agent in the name of the Borrower but under the sole dominion and control of the
Administrative Agent, (II) grant to the Administrative Agent for the benefit of the Issuing Lender
and the other Lenders, as security for the unallocated portion of such Defaulting Lender’s Ratable
Share of all Letter of Credit Obligations, a security interest in



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the Letter of Credit Collateral Account and any funds that may be deposited therein and (III)
maintain in the Letter of Credit Collateral Account an amount equal to the unallocated portion of
such Defaulting Lender’s Ratable Share of all Letter of Credit Obligations, regardless of whether
any Letters of Credit have then been drawn.




          (iv) (A) the Swing Loan Lender shall not be required to, but in its sole discretion may from
time to time elect to, fund any Swing Loan and (B) the Issuing Lender shall not be required to, but
in its sole discretion may from time to time elect to, issue, amend or increase any Letter of
Credit, unless in each case it is satisfied in its sole discretion that the related exposure will
be 100% covered by the Non-Defaulting Lenders and/or cash collateral will be provided by the
Borrower in accordance with Section 2.8.13(iii).




          (v) any amount payable to a Defaulting Lender hereunder (whether on account of principal,
interest, fees or otherwise) shall, in lieu of being distributed to such Defaulting Lender, be
retained by the Administrative Agent in a segregated non-interest bearing account and, to the
fullest extent permitted by law, be applied at such time or times as may be determined by the
Administrative Agent (A) first, to the payment of any amounts owing by such Defaulting Lender to
the Administrative Agent hereunder, (B) second, pro rata, to the payment of any
amounts owing by such Defaulting Lender to the Issuing Lender and the Swing Loan Lender under this
Agreement, and (C) after the termination of the Revolving Credit Commitments and payment in full of
all obligations of the Borrower hereunder, to pay amounts owing under this Agreement to such
Defaulting Lender or as a court of competent jurisdiction may otherwise direct.




          (vi) In the event that the Borrower, the Administrative Agent, the Issuing Lender and the
Swing Lender each agrees that a Defaulting Lender has adequately remedied all matters that caused
such Lender to be a Defaulting Lender, then the Swing Loans and the Letter of Credit participations
of the Revolving Credit Lenders shall be readjusted to reflect the inclusion of such Lender’s
Ratable Share and on such date such Lender shall purchase at par such of the Revolving Credit Loans
of the other Lenders as the Administrative Agent shall determine may be necessary in order for such
Lender to hold such Revolving Credit Loans in accordance with its Ratable Share, subject to the
provisions of Section 4.9.




3. INTEREST RATES




     3.1 Interest Rate Options. The Borrower shall pay interest in respect of the
outstanding unpaid principal amount of the Loans as selected by it from the Base Rate Option or
LIBOR Rate Option set forth below applicable to the Loans, it being understood that, subject to the
provisions of this Agreement, the Borrower may select different Interest Rate Options and different
Interest Periods to apply simultaneously to the Loans comprising different Borrowing Tranches and
may convert to or renew one or more Interest Rate Options with respect to all or any portion of the
Loans comprising any Borrowing Tranche; provided, that there shall not be at any one time
outstanding more than seven (7) Borrowing Tranches in the aggregate among all of the Loans; and
provided, further, that if an Event of Default exists and is continuing and the Administrative
Agent, either in its sole discretion or at the request of the Required Lenders, so notifies the
Borrower, then, so long as an Event of Default is continuing (i) no Loan may be requested, and no
outstanding Loan may be converted to or continued, under the LIBOR Rate



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Option and (ii) unless repaid, each Borrowing Tranche under the LIBOR Rate Option shall be
converted to the Base Rate Option at the end of the Interest Period applicable thereto. If at any
time the designated rate applicable to any Loan made by any Lender exceeds such Lender’s highest
lawful rate, the rate of interest on such Lender’s Loan shall be limited to such Lender’s highest
lawful rate.




          3.1.1 Revolving Credit Interest Rate Options; Swing Line Interest Rate. The Borrower
shall have the right to select from the following Interest Rate Options applicable to the Revolving
Credit Loans:




          (i) Revolving Credit Base Rate Option: A fluctuating rate per annum (computed on the
basis of a year of 365 or 366 days, as the case may be, and actual days elapsed) equal to the Base
Rate plus the Applicable Margin for Loans bearing interest at the Base Rate Option, such interest
rate to change automatically from time to time effective as of the effective date of each change in
the Base Rate; or




          (ii) Revolving Credit LIBOR Rate Option: A rate per annum (computed on the basis of a
year of 360 days and actual days elapsed) equal to the LIBOR Rate plus the Applicable Margin for
Loans bearing interest at the LIBOR Rate Option.



Subject to Section 3.3, either the Base Rate Option or such other rate mutually agreed upon by the
Borrower and PNC shall apply to each Swing Loan.




          3.1.2 Rate Quotations. The Borrower may call the Administrative Agent on or before
the date on which a Loan Request is to be delivered to receive an indication of the rates then in
effect, but it is acknowledged that such projection shall not be binding on the Administrative
Agent or the Lenders nor affect the rate of interest which thereafter is actually in effect when
the election is made.




     3.2 Interest Periods. At any time when the Borrower shall select, convert to or renew
a LIBOR Rate Option, the Borrower shall notify the Administrative Agent thereof at least three (3)
Business Days prior to the effective date of such LIBOR Rate Option by delivering a Loan Request.
The notice shall specify an Interest Period during which such Interest Rate Option shall apply.
Notwithstanding the preceding sentence, the following provisions shall apply to any selection of,
renewal of, or conversion to a LIBOR Rate Option:



          3.2.1 Amount of Borrowing Tranche. Each Borrowing Tranche of Loans under the LIBOR
Rate Option shall be in integral multiples of $100,000 and not less than $1,000,000 (or, if the
then aggregate amount available for borrowing under the Revolving Credit Commitments is less than
$1,000,000, such lesser amount); and




          3.2.2 Renewals. In the case of the renewal of a LIBOR Rate Option at the end of an
Interest Period, the first day of the new Interest Period shall be the last day of the preceding
Interest Period, without duplication in payment of interest for such day.







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     3.3 Interest After Default.



          3.3.1 Interest Rate. To the extent permitted by law, if any principal of or interest
on any Loan is not paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate per annum equal to
2% per annum plus the rate otherwise applicable to such Loan as provided in Section 3.1.1. In
addition, at any time that an Event of Default shall have occurred and be continuing, at the
discretion of the Administrative Agent or at the written request of the Required Lenders and
whether or not any principal or interest of any Loan has not been paid when due, all Loans shall
bear interest, after as well as before judgment, at a rate per annum equal to 2% per annum plus the
rate otherwise applicable to such Loans as provided in Section 3.1.1.




          3.3.2 Letter of Credit Fees and Other Obligations. To the extent permitted by the
Law, at any time that an Event of Default shall have occurred and be continuing, at the discretion
of the Administrative Agent or at the written request of the Required Lenders to the Administrative
Agent, (i) the Letter of Credit Fee otherwise applicable pursuant to Section 2.8.2 , shall be
increased by 2.0% per annum and (ii) each other Obligation hereunder if not paid when due shall
bear interest at a rate per annum equal to the sum of the rate of interest applicable under the
Base Rate Option plus an additional 2% per annum from the time such Obligation becomes due and
payable and until it is paid in full.




          3.3.3 Acknowledgment; Payable on Demand. The Borrower acknowledges that the increase
in rates referred to in this Section 3.3 reflects, among other things, the fact that such Loans or
other amounts have become a substantially greater risk given their default status and that the
Lenders are entitled to additional compensation for such risk. Under the circumstances described
in this Section, interest on the Loans and the other amount referred to above shall be payable by
the Borrower upon demand by the Administrative Agent.




     3.4 LIBOR Rate Unascertainable; Illegality; Increased Costs; Deposits Not Available.



          3.4.1 Unascertainable. If on any date on which a LIBOR Rate would otherwise be
determined, the Administrative Agent shall have determined that:




          (i) adequate and reasonable means do not exist for ascertaining such LIBOR Rate; or




          (ii) a contingency has occurred which materially and adversely affects the London interbank
eurodollar market relating to the LIBOR Rate;



the Administrative Agent shall have the rights specified in Section 3.4.3.




          3.4.2 Illegality; Increased Costs; Deposits Not Available. If at any time any Lender
shall have determined that:




          (i) the making, maintenance or funding of any Loan to which a LIBOR Rate Option applies has
been made impracticable or unlawful by compliance by such Lender in good faith with any Law or any
interpretation or application thereof by any Official Body or with any request or directive of any
such Official Body (whether or not having the force of Law), or







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          (ii) such LIBOR Rate Option will not adequately and fairly reflect the cost to such Lender of
the establishment or maintenance of any such Loan, or




          (iii) after making all reasonable efforts, deposits of the relevant amount in Dollars for the
relevant Interest Period for a Loan, or to banks generally, to which a LIBOR Rate Option applies,
respectively, are not available to such Lender with respect to such Loan, or to banks generally, in
the interbank eurodollar market,



then the Administrative Agent shall have the rights specified in Section 3.4.3.




          3.4.3 Administrative Agent’s and Lender’s Rights. In the case of any event specified
in Section 3.4.1 above, the Administrative Agent shall promptly so notify the Lenders and the
Borrower thereof, and in the case of an event specified in Section 3.4.2 above, such Lender shall
promptly so notify the Administrative Agent and endorse a certificate to such notice as to the
specific circumstances of such notice, and the Administrative Agent shall promptly send copies of
such notice and certificate to the other Lenders and the Borrower. Upon such date as shall be
specified in such notice (which shall not be earlier than the date such notice is given), the
obligation of (A) the Lenders, in the case of such notice given by the Administrative Agent, or
(B) such Lender, in the case of such notice given by such Lender, to allow the Borrower to select,
convert to or renew a LIBOR Rate Option shall be suspended until the Administrative Agent shall
have later notified the Borrower, or such Lender shall have later notified the Administrative
Agent, of the Administrative Agent’s or such Lender’s, as the case may be, determination that the
circumstances giving rise to such previous determination no longer exist. If at any time the
Administrative Agent makes a determination under Section 3.4.1 and the Borrower has previously
notified the Administrative Agent of its selection of, conversion to or renewal of a LIBOR Rate
Option and such Interest Rate Option has not yet gone into effect, such notification shall be
deemed to provide for selection of, conversion to or renewal of the Base Rate Option otherwise
available with respect to such Loans. If any Lender notifies the Administrative Agent of a
determination under Section 3.4.2 , the Borrower shall, subject to the Borrower’s indemnification
Obligations under Section 4.9, as to any Loan of the Lender to which a LIBOR Rate Option applies,
on the date specified in such notice either convert such Loan to the Base Rate Option otherwise
available with respect to such Loan or prepay such Loan in accordance with Section 4.6. Absent due
notice from the Borrower of conversion or prepayment, such Loan shall automatically be converted to
the Base Rate Option otherwise available with respect to such Loan upon such specified date.




     3.5 Selection of Interest Rate Options. If the Borrower fails to deliver a timely
Loan Request with respect to any Borrowing Tranche of Loans under the LIBOR Rate Option at the
expiration of an existing Interest Period applicable to such Borrowing Tranche in accordance with
the provisions of Section 3.2, the Borrower shall be deemed to have converted such Borrowing
Tranche to the Base Rate Option, commencing upon the last day of the existing Interest Period. If
the Borrower delivers a timely Loan Request with respect to Loans under the LIBOR Rate Option but
does not specify an Interest Period, then the Borrower shall have been deemed to have selected an
Interest Period of one Month’s duration.




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4. PAYMENTS




     4.1 Payments. All payments and prepayments to be made in respect of principal, interest, Commitment Fees,
Letter of Credit Fees, Administrative Agent’s Fee or other fees or amounts due from the Borrower
hereunder shall be payable prior to 11:00 a.m. on the date when due without presentment, demand,
protest or notice of any kind, all of which are hereby expressly waived by the Borrower, and
without set-off, counterclaim or other deduction of any nature, and an action therefor shall
immediately accrue. Such payments shall be made to the Administrative Agent at the Principal
Office for the account of PNC with respect to the Swing Loans and for the ratable accounts of the
Lenders with respect to the Revolving Credit Loans in U.S. Dollars and in immediately available
funds, and the Administrative Agent shall promptly distribute such amounts to the Lenders in
immediately available funds; provided that in the event payments are received by 11:00 a.m. by the
Administrative Agent with respect to the Loans and such payments are not distributed to the Lenders
on the same day received by the Administrative Agent, the Administrative Agent shall pay the
Lenders the Federal Funds Effective Rate with respect to the amount of such payments for each day
held by the Administrative Agent and not distributed to the Lenders. The Administrative Agent’s
and each Lender’s statement of account, ledger or other relevant record shall, in the absence of
manifest error, be conclusive as the statement of the amount of principal of and interest on the
Loans and other amounts owing under this Agreement and shall be deemed an “account stated.”



     4.2 Pro Rata Treatment of Lenders. Each borrowing of Revolving Credit Loans shall be allocated to each Lender according to its
Ratable Share, and each selection of, conversion to or renewal of any Interest Rate Option and each
payment or prepayment by the Borrower with respect to principal, interest, Commitment Fees,
Facility Fees, Letter of Credit Fees, or other fees (except for the Administrative Agent’s Fee and
the Issuing Lender’s fronting fee) or amounts due from the Borrower hereunder to the Lenders with
respect to the Commitments and Loans, shall (except as otherwise may be provided with respect to a
Defaulting Lender and except as provided in Section 3.4.3 in the case of an event specified in
Section 3.4.2, 4.7 or 4.8) be payable ratably among the Lenders entitled to such payment in
accordance with the amount of principal, interest, Commitment Fees, Letter of Credit Fees, and
other fees or amounts then due or payable such Lenders as set forth in this Agreement.
Notwithstanding any of the foregoing, each borrowing or payment or prepayment by the Borrower of
principal, interest, fees or other amounts from the Borrower with respect to Swing Loans shall be
made by or to PNC according to Section 2.5.5.



     4.3 Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff, counterclaim or banker’s lien, by
receipt of voluntary payment, by realization upon security, or by any other non-pro rata source,
obtain payment in respect of any principal of or interest on any of its Loans or other obligations
hereunder resulting in such Lender’s receiving payment of a proportion of the aggregate amount of
its Loans and accrued interest thereon or other such obligations greater than the pro-rata share of
the amount such Lender is entitled thereto, then the Lender receiving such greater proportion shall
(a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value)
participations in the Loans and such other obligations of the other Lenders, or make such other
adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with



- 42 -









 




the aggregate amount of principal of and accrued interest on their respective Loans and other
amounts owing them, provided that:




          (i) if any such participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase price restored to the
extent of such recovery, together with interest or other amounts, if any, required by Law
(including court order) to be paid by the Lender or the holder making such purchase; and




          (ii) the provisions of this Section 4.3 shall not be construed to apply to (x) any payment
made by the Loan Parties pursuant to and in accordance with the express terms of the Loan Documents
or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or Participation Advances to any assignee or participant, other
than to the Borrower or any Subsidiary thereof (as to which the provisions of this Section 4.3
shall apply).



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



Any Lender that fails at any time to comply with the provisions of this Section 4.3 (a “Breaching
Lender”) shall be deemed to have assigned any and all payments due to it from the Borrower, whether
on account of or relating to outstanding Loans, Letters of Credit, interest, fees or otherwise, to
the remaining Lenders (other than Defaulting Lenders) for application to, and reduction of, their
respective Ratable Share of all outstanding Loans and other unpaid Obligations of any of the Loan
Parties. The Breaching Lender hereby authorizes the Administrative Agent to distribute such
payments to such remaining Lenders (other than Defaulting Lenders) in proportion to their
respective Ratable Share of all outstanding Loans and other unpaid Obligations of any of the Loan
Parties to which such Lenders are entitled. A Breaching Lender shall be deemed to have satisfied
the provisions of this Section 4.3 when and if, as a result of application of the assigned payments
to all outstanding Loans and other unpaid Obligations of any of the Loan Parties to the
Non-Defaulting Lenders, the Non-Defaulting Lenders’ (other than Defaulting Lenders) respective
Ratable Share of all outstanding Loans and unpaid Obligations have returned to those in effect
immediately prior to such violation of this Section 4.3.




     4.4 Presumptions by Administrative Agent. Unless the Administrative Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Administrative Agent for the account of the Lenders or the
Issuing Lender hereunder that the Borrower will not make such payment, the Administrative Agent may
assume that the Borrower has made such payment on such date in accordance herewith and may, in
reliance upon such assumption, distribute to the Lenders or the Issuing Lender, as the case may be,
the amount due. In such event, if the Borrower has not in fact made such payment, then each of the
Lenders or the Issuing Lender, as the case may be, severally agrees to repay to the Administrative
Agent forthwith on demand the amount so distributed to such Lender or the Issuing Lender, with



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interest thereon, for each day from and including the date such amount is distributed to it to
but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation.




     4.5 Interest Payment Dates. Interest on Loans to which the Base Rate Option applies shall be due and payable in arrears
on each Payment Date. Interest on Loans to which the LIBOR Rate Option applies shall be due and
payable on the last day of each Interest Period for those Loans and, if such Interest Period is
longer than three (3) Months, also on the 90th day of such Interest Period. Interest on the
principal amount of each Loan or other monetary Obligation shall be due and payable on demand after
such principal amount or other monetary Obligation becomes due and payable (whether on the stated
Expiration Date, upon acceleration or otherwise).



     4.6 Voluntary Prepayments.



          4.6.1 Right to Prepay. The Borrower shall have the right at its option from time to time to prepay the Loans in
whole or part without premium or penalty (except as provided in Section 4.9). Whenever the
Borrower desires to prepay any part of the Loans, it shall provide a prepayment notice to the
Administrative Agent by 1:00 p.m. at least (A) one (1) Business Day prior to the date of prepayment
of the Revolving Credit Loans to which the Base Rate Option applies and (B) three (3) Business Days
prior to the prepayment of the Revolving Credit Loans to which the LIBOR Rate Option applies or no
later than 1:00 p.m. on the date of prepayment of Swing Loans, setting forth the following
information:





     (w) the date, which shall be a Business Day, on which the proposed
prepayment is to be made;




     (x) a statement indicating the application of the prepayment between
the Revolving Credit Loans and Swing Loans;




     (y) a statement indicating the application of the prepayment between
Loans to which the Base Rate Option applies and Loans to which the LIBOR
Rate Option applies; and




     (z) the total principal amount of such prepayment, which shall not be
less than the lesser of (i) the Revolving Facility Usage or (ii) $100,000
for any Swing Loan or $1,000,000 for any Revolving Credit Loan.



          All prepayment notices shall be irrevocable; provided that a notice of prepayment delivered by
the Borrower in conjunction with a notice of termination of the Revolving Credit Commitments in
full delivered pursuant to Section 2.8.11 may state that such notice is conditioned upon the
effectiveness of other credit facilities or debt or equity issuances, in which case such notice may
be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. The principal amount of the Loans for which a
prepayment notice is given, together with accrued and unpaid interest on such principal amount
shall be due and payable on the date specified in such prepayment notice






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as the date on which the proposed prepayment is to be made; provided that, any
prepayment of Loans to which the Base Rate Option applies shall not require a payment of accrued
and unpaid interest thereon so long as the Revolving Credit Commitments are in effect. Except as
provided in Section 3.4.3 , if the Borrower prepays a Loan but fails to specify the applicable
Borrowing Tranche which the Borrower is prepaying, the prepayment shall be applied (i) first to
Loans to which the Base Rate Option applies, then to Loans to which the LIBOR Rate Option applies.
Any prepayment hereunder shall be subject to the Borrower’s obligation to indemnify the Lenders
under Section 4.9.




          4.6.2 Replacement of a Lender. In the event any Lender (i) gives notice under Section 3.4, (ii) requests compensation
under Section 4.7, or requires the Borrower to pay any additional amount to any Lender or any
Official Body for the account of any Lender pursuant to Section 4.8, (iii) is a Defaulting Lender,
(iv) becomes subject to the control of an Official Body (other than normal and customary
supervision), or (v) is a Non-Consenting Lender referred to in Section 10.1, then in any such event
the Borrower may, at its sole expense, upon notice to such Lender and the Administrative Agent,
require such Lender to assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in, and consents required by, Section 10.8), all of its interests, rights
and obligations under this Agreement and the related Loan Documents to an assignee that shall
assume such obligations (which assignee may be another Lender, if a Lender accepts such
assignment), provided that:




          (i) the Borrower shall have paid to the Administrative Agent the assignment fee specified in
Section 10.8;




          (ii) such Lender shall have received payment of an amount equal to the outstanding principal
of its Loans and Participation Advances, accrued interest thereon, accrued fees and all other
amounts payable to it hereunder and under the other Loan Documents (including any amounts under
Section 4.9) from the assignee (to the extent of such outstanding principal and accrued interest
and fees) or the Borrower (in the case of all other amounts);




          (iii) in the case of any such assignment resulting from a claim for compensation under Section
4.7.1 or payments required to be made pursuant to Section 4.8, such assignment will result in a
reduction in such compensation or payments thereafter; and




          (iv) such assignment does not conflict with applicable Law.



A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a
result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.




     4.7 Increased Costs.



          4.7.1 Increased Costs Generally. If any Change in Law shall:




          (i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance
charge or similar requirement against assets of, deposits with or for the account of, or credit
extended or participated in by, any Lender (except any reserve requirement reflected in the LIBOR
Rate) or the Issuing Lender;







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          (ii) subject any Lender or the Issuing Lender to any tax of any kind whatsoever with respect
to this Agreement, any Letter of Credit, any participation in a Letter of Credit or any Loan under
the LIBOR Rate Option made by it, or change the basis of taxation of payments to such Lender or the
Issuing Lender in respect thereof (except for Indemnified Taxes or Other Taxes covered by Section
4.8 and the imposition of, or any change in the rate of, any Excluded Tax payable by such Lender or
the Issuing Lender); or




          (iii) impose on any Lender, the Issuing Lender or the London interbank market any other
condition, cost or expense affecting this Agreement or any Loan under the LIBOR Rate Option made by
such Lender or any Letter of Credit or participation therein;



and the result of any of the foregoing shall be to increase the cost to such Lender of making or
maintaining any Loan under the LIBOR Rate Option (or of maintaining its obligation to make any such
Loan), or to increase the cost to such Lender or the Issuing Lender of participating in, issuing or
maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue
any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or
the Issuing Lender hereunder (whether of principal, interest or any other amount), then, upon
request of such Lender or the Issuing Lender, the Borrower will pay to such Lender or the Issuing
Lender, as the case may be, such additional amount or amounts as will compensate such Lender or the
Issuing Lender, as the case may be, for such additional costs incurred or reduction suffered.




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




          4.7.3 Certificates for Reimbursement; Repayment of Outstanding Loans; Borrowing of New
Loans. A certificate of a Lender or the Issuing Lender setting forth the amount or amounts
necessary to compensate such Lender or the Issuing Lender or its holding company, as the case may
be, as specified in Sections 4.7.1 or 4.7.2 and delivered to the Borrower shall be conclusive
absent manifest error. The Borrower shall pay such Lender or the Issuing Lender, as the case may
be, the amount shown as due on any such certificate within ten (10) days after receipt thereof.







- 46 -









 








          4.7.4 Delay in Requests. Failure or delay on the part of any Lender or the Issuing Lender to demand compensation
pursuant to this Section shall not constitute a waiver of such Lender’s or the Issuing Lender’s
right to demand such compensation, provided that the Borrower shall not be required to
compensate a Lender or the Issuing Lender pursuant to this Section for any increased costs incurred
or reductions suffered unless such Lender or Issuing Lender gives notice to the Borrower that it is
obligated to pay an amount under this Section within six (6) months after the later of (i) the date
that such Lender or the Issuing Lender, as the case may be, incurs such increased costs or
reductions or (ii) such Lender or the Issuing Lender has actual knowledge of its incurrence of
such increased costs or reductions (except that, if the Change in Law giving rise to such increased
costs or reductions is retroactive, then the six (6) month period referred to above shall be
extended to include the period of retroactive effect thereof).




          Notwithstanding any other provision of this Section 4.7, neither any Lender nor the Issuing
Lender shall demand compensation for any increased costs or reduction referred to in this Section
4.7 if it shall not be the general policy or practice of such Lender or the Issuing Lender, as the
case may be, to demand such compensation in similar circumstances under comparable provisions of
other credit agreements, if any (it being understood that this sentence shall not in any way limit
the discretion of any Lender or the Issuing Lender to waive the right to demand such compensation
in any given case).




     4.8 Taxes.



          4.8.1 Payments Free of Taxes. Any and all payments by or on account of any obligation of the Borrower hereunder or under
any other Loan Document shall be made free and clear of and without reduction or withholding for
any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be required by applicable
Law to deduct any Indemnified Taxes (including any Other Taxes) from such payments, then (i) the
sum payable shall be increased as necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section) the Administrative Agent,
Lender or Issuing Lender, as the case may be, receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrower shall make such deductions and (iii)
the Borrower shall timely pay the full amount deducted to the relevant Official Body in accordance
with applicable Law.




          4.8.2 Payment of Other Taxes by the Borrower. Without limiting the provisions of Section 4.8.1 above, the Borrower shall timely pay any
Other Taxes to the relevant Official Body in accordance with applicable Law.




          4.8.3 Indemnification by the Borrower. The Borrower shall indemnify the Administrative Agent, each Lender and the Issuing Lender,
within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes or Other
Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts
payable under this Section) paid by the Administrative Agent, such Lender or the Issuing Lender, as
the case may be, and any penalties, interest and reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant Official Body. A certificate as to the amount of such payment
or liability delivered to the Borrower by a Lender or the Issuing Lender (with a copy to the






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Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a
Lender or the Issuing Lender, shall be conclusive absent manifest error.




          4.8.4 Evidence of Payments. As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the
Borrower to an Official Body, the Borrower shall deliver to the Administrative Agent the original
or a certified copy of a receipt issued by such Official Body evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably satisfactory to the
Administrative Agent.




          4.8.5 Status of Lenders. Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax
under the Law of the jurisdiction in which the Borrower is resident for tax purposes, or any treaty
to which such jurisdiction is a party, with respect to payments hereunder or under any other Loan
Document shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or
times prescribed by applicable Law or reasonably requested by the Borrower or the Administrative
Agent, such properly completed and executed documentation prescribed by applicable Law as will
permit such payments to be made without withholding or at a reduced rate of withholding. In
addition, each Foreign Lender shall deliver such forms promptly upon the obsolescence, expiration
or invalidity of such form previously delivered by such Foreign Lender. Notwithstanding the
submission of such documentation claiming a reduced rate of or exemption from U.S. withholding tax,
the Administrative Agent shall be entitled to withhold United States federal income taxes at the
full statutory withholding rate then in effect if in its reasonable judgment it is required to do
so under the due diligence requirements imposed upon a withholding agent under §1.1441-7(b) of the
United States Income Tax Regulations. The Administrative Agent is indemnified under §1.1461-1(e)
of the United States Income Tax Regulations against any claims and demands of any Lender or
assignee or participant of a Lender for the amount of any tax it deducts and withholds in
accordance with regulations under § 1441 of the Internal Revenue Code. In addition, any Lender, if
requested by the Borrower or the Administrative Agent, shall deliver such other documentation
prescribed by applicable Law or reasonably requested by the Borrower or the Administrative Agent as
will enable the Borrower or the Administrative Agent to determine whether or not such Lender is
subject to backup withholding or information reporting requirements or to determine the amount of
backup withholding tax to deduct and withhold from such payment. Each Foreign Lender shall
promptly notify the Administrative Agent and the Borrower at any time it determines that it is no
longer in a position to provide any previously delivered certificate to the Borrower (or any other
form of certification adopted by the U.S. taxing authority for such purpose).




          Without limiting the generality of the foregoing, in the event that the Borrower is resident
for tax purposes in the United States of America, any Foreign Lender shall deliver to the Borrower
and the Administrative Agent (in such number of copies as shall be requested by the recipient) on
or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from
time to time thereafter upon the request of the Borrower or the Administrative Agent, but only if
such Foreign Lender is legally entitled to do so), whichever of the following is applicable:




          (i) two (2) duly completed valid originals of IRS Form W-8BEN claiming eligibility for
benefits of an income tax treaty to which the United States of America is a party,







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          (ii) two (2) duly completed valid originals of IRS Form W-8ECI,




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




          (iv) any other form prescribed by applicable Law as a basis for claiming exemption from or a
reduction in United States Federal withholding tax duly completed together with such supplementary
documentation as may be prescribed by applicable Law to permit the Borrower to determine the
withholding or deduction required to be made, or




          (v) to the extent that any Lender is not a Foreign Lender, such Lender shall submit to the
Administrative Agent and, upon a written request therefor from the Borrower, to the Borrower two
(2) originals of an IRS Form W-9 or any other form prescribed by applicable Law demonstrating that
such Lender is not a Foreign Lender.




          If a payment made to a Lender under any Loan Document would be subject to U.S. Federal
withholding tax imposed by FATCA if such Lender were to fail to comply with the applicable
reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the
Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent, at
the time or times prescribed by law and at such time or times reasonably requested by the Borrower
or the Administrative Agent, such documentation prescribed by applicable law (including any notice
described in Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably
requested by the Borrower or the Administrative Agent as may be necessary for the Borrower or the
Administrative Agent, as the case may be, to comply with its obligations under FATCA, to determine
that such Lender has or has not complied with such Lender’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment.




          4.8.6 Treatment of Certain Refunds. If the Administrative Agent, a Lender or the Issuing Lender determines, in its sole
discretion, that it has received a refund of any Taxes or Other Taxes as to which it has been
indemnified by the Borrower or with respect to which the Borrower has paid additional amounts
pursuant to this Section, it shall, within 30 days from the date of such receipt, pay to the
Borrower an amount equal to such refund (but only to the extent of indemnity payments made, or
additional amounts paid, by the Borrower under this Section with respect to the Taxes or Other
Taxes giving rise to such refund); net of all out-of-pocket expenses of the Administrative Agent,
such Lender or the Issuing Lender, as the case may be, and without interest (other than any
interest paid by the relevant Official Body with respect to such refund), provided that the
Borrower, upon the request of the Administrative Agent, such Lender or the Issuing Lender, agrees
to repay the amount paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Official Body) to the Administrative Agent, such Lender or the Issuing
Lender in the event the Administrative Agent, such Lender or the Issuing Lender is required to
repay such refund to such Official Body. This Section shall not be construed to require the
Administrative Agent, any Lender or the Issuing Lender to make






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available its tax returns (or any other information relating to its taxes that it deems
confidential) to the Borrower or any other Person.




     4.9 Indemnity. In addition to the compensation or payments required by Section 4.7 or Section 4.8, the
Borrower shall indemnify each Lender against all liabilities, losses or expenses (including loss of
anticipated profits and any loss or expense arising from the liquidation or reemployment of funds
obtained by it to maintain such Loan, from fees payable to terminate the deposits from which such
funds were obtained) which such Lender sustains or incurs as a consequence of any:



          (i) payment, prepayment, conversion or renewal of any Loan to which a LIBOR Rate Option
applies on a day other than the last day of the corresponding Interest Period (whether or not such
payment or prepayment is mandatory, voluntary or automatic and whether or not such payment or
prepayment is then due); or




          (ii) the failure to borrow, convert, continue, pay or prepay any Loan (for a reason other than
the failure of such Lender to make a Loan in accordance with the terms hereof) on the date
specified in any notice delivered pursuant hereto.




          If any Lender sustains or incurs any such loss or expense, it shall from time to time notify
the Borrower of the amount determined in good faith by such Lender (which determination may include
such assumptions, allocations of costs and expenses and averaging or attribution methods as such
Lender shall deem reasonable) to be necessary to indemnify such Lender for such loss or expense.
Such notice shall set forth in reasonable detail the basis for such determination. Such amount
shall be due and payable by the Borrower to such Lender ten (10) Business Days after such notice is
given.




     4.10 Settlement Date Procedures. In order to minimize the transfer of funds between the Lenders and the Administrative Agent,
the Borrower may borrow, repay and reborrow Swing Loans and PNC may make Swing Loans as provided in
Section 2.1.2 hereof during the period between Settlement Dates. The Administrative Agent shall
notify each Lender of its Ratable Share of the total of the Revolving Credit Loans and the Swing
Loans (each a “Required Share”). On such Settlement Date, each Lender shall pay to the
Administrative Agent the amount equal to the difference between its Required Share and its
Revolving Credit Loans, and the Administrative Agent shall pay to each Lender its Ratable Share of
all payments made by the Borrower to the Administrative Agent with respect to the Revolving Credit
Loans. The Administrative Agent shall also effect settlement in accordance with the foregoing
sentence on the proposed Borrowing Dates for Revolving Credit Loans and may at its option effect
settlement on any other Business Day. These settlement procedures are established solely as a
matter of administrative convenience, and nothing contained in this Section 4.10 shall relieve the
Lenders of their obligations to fund Revolving Credit Loans on dates other than a Settlement Date
pursuant to Section 2.1.2 . The Administrative Agent may at any time at its option for any reason
whatsoever require each Lender to pay immediately to the Administrative Agent such Lender’s Ratable
Share of the outstanding Revolving Credit Loans and each Lender may at any time require the
Administrative Agent to pay immediately to such Lender its Ratable Share of all payments made by
the Borrower to the Administrative Agent with respect to the Revolving Credit Loans.



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5. REPRESENTATIONS AND WARRANTIES




     5.1 Representations and Warranties. The Borrower represents and warrants to the Administrative Agent and each of the Lenders as
follows:



          5.1.1 Financial Condition.




          (i) The unaudited pro forma consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at September 30, 2010 (including the notes thereto) (the “Pro
Forma Balance Sheet”), copies of which have heretofore been furnished to each Lender, has been
prepared giving effect (as if such events had occurred on such date) to (a) the Loans to be made on
the Closing Date and the use of proceeds thereof and (b) the payment of fees and expenses in
connection with the foregoing. The Pro Forma Balance Sheet has been prepared based on the best
information available to the Borrower as of the date of delivery thereof, and presents fairly on a
pro forma basis the estimated financial position of Borrower and its consolidated
Subsidiaries as at September 30, 2010, assuming that the events specified in the preceding sentence
had actually occurred at such date.




          (ii) The audited consolidated balance sheets of the Borrower as at December 31, 2009, and the
related consolidated statements of income and of cash flows for the fiscal years ended on such
dates, reported on by and accompanied by an unqualified report from Ernst & Young LLP, present
fairly in all material respects the consolidated financial condition of the Borrower as at such
date, and the consolidated results of its operations and its consolidated cash flows for the
respective fiscal years then ended. Such audited financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by the aforementioned firm of accountants and
disclosed therein).




          (iii) The unaudited consolidated balance sheet of the Borrower as at September 30, 2010, and
the related unaudited consolidated statements of income and cash flows for the nine-month period
ended on such date, present fairly in all material respects the consolidated financial condition of
the Borrower as at such date, and the consolidated results of its operations and its consolidated
cash flows for the nine-month period then ended. All such unaudited financial statements have been
prepared in accordance with GAAP applied consistently throughout the periods involved (subject to
normal year-end audit adjustments and the absence of footnotes).




               5.1.1.2 Neither the Borrower nor any of its Subsidiaries has any material Guarantee
Obligations, contingent liabilities or liabilities for taxes, or any long-term material leases or
unusual forward or long-term commitments, including any interest rate or foreign currency swap or
exchange transaction or other obligation in respect of derivatives, that are not reflected in the
most recent financial statements referred to in Sections 5.1.1(ii) or (iii) and are not permitted
to be incurred under this Agreement. During the period from September 30, 2010 to and including
the date hereof there has been no Disposition by any Group Member of any material part of its
business or property.



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          5.1.2 No Change. Since September 30, 2010, there has been no development or event that has had or could
reasonably be expected to have a Material Adverse Effect.




          5.1.3 Existence; Compliance with Law. Each Group Member (a) is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization (except no representation is made as to the good
standing of any Subsidiary organized under the laws of a jurisdiction in which there is no concept
of good standing), (b) has the power and authority, and the legal right, to own and operate its
property, to lease the property it operates as lessee and to conduct the business in which it is
currently engaged, (c) is duly qualified as a foreign corporation and in good standing under the
laws of each jurisdiction where its ownership, lease or operation of property or the conduct of its
business requires such qualification, except to the extent that the failure to so qualify would
not, in the aggregate, be reasonably likely to have a Material Adverse Effect, and (d) is in
compliance with all Requirements of Law except to the extent that the failure to comply therewith
could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.




          5.1.4 Power; Authorization; Enforceable Obligations. Each Loan Party has the power and authority, and the legal right, to make, deliver and
perform the Loan Documents to which it is a party and, in the case of the Borrower, to obtain
extensions of credit hereunder. Each Loan Party has taken all necessary organizational action to
authorize the execution, delivery and performance of the Loan Documents to which it is a party and,
in the case of the Borrower, to authorize the extensions of credit on the terms and conditions of
this Agreement. No consent or authorization of, filing with, notice to or other act by or in
respect of, any Official Body or any other Person is required in connection with the extensions of
credit hereunder or with the execution, delivery, performance, validity or enforceability of this
Agreement or any of the Loan Documents, except (i) consents, authorizations, filings and notices
described in Schedule 5.1.4, which consents, authorizations, filings and notices have been
obtained or made and are in full force and effect and (ii) the filings referred to in Section
5.1.17. Each Loan Document has been duly executed and delivered on behalf of each Loan Party party
thereto. This Agreement constitutes, and each other Loan Document upon execution will constitute,
a legal, valid and binding obligation of each Loan Party party thereto, enforceable against each
such Loan Party in accordance with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether enforcement is sought by
proceedings in equity or at law).




          5.1.5 No Legal Bar. The execution, delivery and performance of this Agreement and the other Loan Documents, the
issuance of Letters of Credit, the borrowings hereunder and the use of the proceeds thereof will
not violate any material Requirement of Law or any Contractual Obligation of any Group Member and
will not result in, or require, the creation or imposition of any Lien on any of their respective
material properties or revenues pursuant to any Requirement of Law or any such Contractual
Obligation (other than the Liens created by the Security Documents).




          5.1.6 Litigation. No litigation, investigation or proceeding of or before any arbitrator or Official Body is
pending or, to the knowledge of the Borrower, threatened by or against any Group Member or against
any of their respective properties or revenues (a) with






- 52 -









 







respect to any of the Loan Documents or any of the transactions contemplated hereby or
thereby, or (b) that could reasonably be expected to have a Material Adverse Effect.




          5.1.7 No Default. No Group Member is in default under or with respect to any of its Contractual Obligations
in any respect that could reasonably be expected to have a Material Adverse Effect. No Potential
Default or Event of Default has occurred and is continuing.




          5.1.8 Ownership of Property; Liens. Each Group Member has title in fee simple to, or a valid leasehold interest in, all its
real property, and good title to, or a valid leasehold interest in, all its other property, and
none of such property is subject to any Lien except as permitted by Section 7.2.7.




          5.1.9 Intellectual Property. Each Group Member owns, or is licensed to use, all Intellectual Property necessary for the
conduct of its business as currently conducted that is material to the business, condition
(financial or otherwise), operations, performance, properties or prospects of the Group Members
taken as a whole. No material claim has been asserted and is pending by any Person challenging or
questioning the use of any Intellectual Property or the validity or effectiveness of any
Intellectual Property that is material to the business, condition (financial or otherwise),
operations, performance, properties or prospects of the Group Members taken as a whole, nor does
the Borrower know of any valid basis for any such claim. The use of Intellectual Property by each
Group Member does not infringe on the rights of any Person, except to the extent of any
infringements which would not, in the aggregate, be reasonably likely to have a Material Adverse
Effect.




          5.1.10 Taxes. Each Group Member has filed or caused to be filed all Federal, state and other material tax
returns that are required to be filed and has paid all taxes shown to be due and payable on said
returns or on any assessments made against it or any of its property and all other taxes, fees or
other charges imposed on it or any of its property by any Official Body (other than any the amount
or validity of which are currently being contested in good faith by appropriate proceedings and
with respect to which reserves in conformity with GAAP have been provided on the books of the
relevant Group Member); no tax Lien has been filed with respect to any Group Member that is not
permitted under Section 7.2.2., and, to the knowledge of the Borrower, no claim is being asserted,
with respect to any such tax, fee or other charge.




          5.1.11 Federal Regulations. No part of the proceeds of any Loans, and no other extensions of credit hereunder, will be
used for any purpose that violates the provisions of the Regulations of the Board. If requested by
any Lender or the Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the requirements of FR Form G-3
or FR Form U-1, as applicable, referred to in Regulation U.




          5.1.12 Labor Matters. Except as, in the aggregate, could not reasonably be expected to have a Material Adverse
Effect: (a) there are no strikes or other labor disputes against any Group Member pending or, to
the knowledge of the Borrower, threatened; (b) hours worked by and payment made to employees of
each Group Member have not been in violation of the Fair Labor Standards Act or any other
applicable Requirement of Law dealing with such matters; and (c) all payments due from any Group
Member on account of employee health and






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welfare insurance have been paid or accrued as a liability on the books of the relevant Group
Member.




          5.1.13 Investment Company Act; Other Regulations. No Loan Party is an “investment company”, or a company “controlled” by an “investment
company”, within the meaning of the Investment Company Act of 1940, as amended. No Loan Party is
subject to regulation under any Requirement of Law (other than Regulation X of the Board) that
limits its ability to incur Indebtedness.




          5.1.14 Subsidiaries. Except as disclosed to the Administrative Agent by the Borrower in writing from time to
time after the Closing Date, (a) Schedule 5.1.14 sets forth the name and jurisdiction of
incorporation of each Subsidiary and, as to each such Subsidiary, the percentage of each class of
Capital Stock owned by any Loan Party and (b) there are no outstanding subscriptions, options,
warrants, calls, rights or other agreements or commitments (other than stock options granted to
employees or directors and directors’ qualifying shares) of any nature relating to any Capital
Stock of the Borrower or any Subsidiary, except as created by the Loan Documents.




          5.1.15 Environmental Matters. Except as, in the aggregate, could not reasonably be expected to have a Material Adverse
Effect:




          (i) the facilities and properties owned, leased or operated by any Group Member (the
“Properties”) do not contain, and have not previously contained, any Materials of Environmental
Concern in amounts or concentrations or under circumstances that constitute or constituted a
violation of, or could give rise to liability under, any Environmental Law;




          (ii) no Group Member has received or is aware of any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding environmental matters or compliance with
Environmental Laws with regard to any of the Properties or the business operated by any Group
Member (the “Business”), nor does the Borrower have knowledge or reason to believe that any such
notice will be received or is being threatened;




          (iii) Materials of Environmental Concern have not been transported or disposed of from the
Properties in violation of, or in a manner or to a location that could give rise to liability
under, any Environmental Law, nor have any Materials of Environmental Concern been generated,
treated, stored or disposed of at, on or under any of the Properties in violation of, or in a
manner that could give rise to liability under, any applicable Environmental Law;




          (iv) no judicial proceeding or governmental or administrative action is pending or, to the
knowledge of the Borrower, threatened, under any Environmental Law to which any Group Member is or
will be named as a party with respect to the Properties or the Business, nor are there any consent
decrees or other decrees, consent orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any Environmental Law with respect to the
Properties or the Business;




          (v) there has been no release or threat of release of Materials of Environmental Concern at or
from the Properties, or arising from or related to the operations of any Group Member in connection
with the Properties or otherwise in connection with the






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Business, in violation of or in amounts or in a manner that could give rise to liability under
Environmental Laws;




          (vi) the Properties and all operations at the Properties are in compliance, and have in the
last five years been in compliance, with all applicable Environmental Laws, and there is no
contamination at, under or about the Properties or violation of any Environmental Law with respect
to the Properties or the Business; and




          (vii) no Group Member has assumed any liability of any other Person under Environmental Laws.




          5.1.16 Accuracy of Information, etc. No written statement or information contained in this Agreement, any other Loan Document or
any other schedule, exhibit, report, document, certificate or other written statement furnished by
or on behalf of any Loan Party to the Administrative Agent or the Lenders, or any of them, for use
in connection with the transactions contemplated by this Agreement or the other Loan Documents
(excluding any projections, pro forma financial information and information of a
general economic or industry nature), as such information, schedule, exhibit, report, document,
certificate or other written statement has been amended, supplemented or superseded by any other
written information, schedule, exhibit, report, document, certificate or other written statement
later delivered to the same parties receiving such written information, schedule, exhibit, report,
document, certificate or other written statement prior to the date on which this representation is
made or deemed made, contained as of the date such written statement, information, schedule,
exhibit, report, document, certificate or other written statement was so furnished, any untrue
statement of a material fact or omitted to state a material fact necessary to make the statements
contained herein or therein, when taken as a whole and in light of the circumstances when made, not
materially misleading, provided that in the case of written information, schedules,
exhibits, reports, documents, certificates, or other written statements made, delivered or prepared
by Persons other than the Borrower, its Subsidiaries and their agents, such representation and
warranty is subject to the qualification that it is true and correct only to the knowledge of the
Borrower and its Subsidiaries. The projections and pro forma financial information
contained in the materials referenced above are based upon good faith estimates and assumptions
believed by management of the Borrower to be reasonable at the time made, it being recognized by
the Lenders that such financial information as it relates to future events is not to be viewed as
fact and that actual results during the period or periods covered by such financial information may
differ from the projected results set forth therein by a material amount. There is no fact known
to any Loan Party that could reasonably be expected to have a Material Adverse Effect that has not
been expressly disclosed herein, in the other Loan Documents, in any other written information,
schedules, exhibits, reports, documents, certificates and written statements furnished to the
Administrative Agent and the Lenders for use in connection with the transactions contemplated
hereby and by the other Loan Documents or in the section entitled “Risks Related to Mafco
Worldwide’s Business and Industry” set forth in the Report on (i) Form 10-K of M&F Worldwide for
the fiscal year ended December 31, 2009 and (ii) Form 10-Q of M&F Worldwide for the fiscal quarters
ended March 31, 2010, June 30 2010 and September 30, 2010.




          5.1.17 Security Documents. The Guarantee and Collateral Agreement is effective to create in favor of the
Administrative Agent, for the benefit of the Lenders, a legal,






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valid and enforceable security interest in the Collateral described therein and proceeds
thereof. In the case of the Pledged Stock described in the Guarantee and Collateral Agreement that
constitutes “certificated securities” (as defined in the UCC), when stock certificates representing
such Pledged Stock are delivered to the Administrative Agent, together with undated stock powers
covering such certificates duly executed in blank by the applicable Loan Party (and, in the case of
any Pledged Stock that is issued by a foreign issuer, the applicable provisions of foreign Law are
complied with), and in the case of the other Collateral described in the Guarantee and Collateral
Agreement, when financing statements and other filings specified on Schedule 5.1.17 in
appropriate form are filed in the offices specified on Schedule 5.1.17 and the other
actions specified on Schedule 5.1.17 have been duly taken, the Guarantee and Collateral
Agreement shall constitute a perfected Lien on, and security interest in, all right, title and
interest of the Loan Parties in such Collateral and the proceeds thereof, as security for the
Obligations (as defined in the Guarantee and Collateral Agreement), in each case prior and superior
in right to any other Person (except, in the case of Collateral other than Pledged Stock that
constitutes certificated securities, Liens permitted by Section 7.2.2).




          5.1.18 Solvency. The Loan Parties, taken as a whole, are, and after giving effect to the incurrence of all
Indebtedness and obligations being incurred in connection herewith will be and will continue to be,
Solvent.




          5.1.19 ERISA Compliance. Neither a Reportable Event nor the failure to satisfy the minimum funding standard as
described in Section 412 of the Code or Section 302 of ERISA has occurred during the five-year
period prior to the date on which this representation is made or deemed made with respect to any
Plan that resulted, or could reasonably be expected to result, in any unpaid liability, and each
Plan (other than any Multiemployer Plan or any multiemployer health or welfare plan) has complied
(in form and in operation) in all material respects with the applicable provisions of ERISA and the
Code, except as such Reportable Event, or such failure to satisfy or comply, could not reasonably
be expected to have a Material Adverse Effect. No Lien in favor of the PBGC or a Plan has arisen
during such five-year period. The present value of all accrued benefits under each Plan (based on
those assumptions used to fund such Plans) did not, as of the last annual valuation date prior to
the date on which this representation is made or deemed made, exceed the value of the assets of
such Plan allocable to such accrued benefits (and also allocable, in the case of a multiple
employer Plan, to the Borrower or its ERISA Affiliates) by a material amount. Neither the Borrower
nor any ERISA Affiliate has had a complete or partial withdrawal from any Multiemployer Plan that
has resulted, or could reasonably be expected to result, in a material liability under ERISA, and
neither the Borrower nor any ERISA Affiliate would become subject to any material liability under
ERISA if the Borrower or any such ERISA Affiliate were to withdraw completely from all
Multiemployer Plans as of the valuation date most closely preceding the date on which this
representation is made or deemed made.




6. CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT




     The obligation of each Lender to make Loans and of the Issuing Lender to issue Letters of
Credit hereunder is subject to the performance by each of the Loan Parties of its Obligations to be
performed hereunder at or prior to the making of any such Loans or issuance of such Letters of
Credit and to the satisfaction of the following further conditions:



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     6.1 First Loans and Letters of Credit.



          6.1.1 Deliveries. On the Closing Date, the Administrative Agent shall have received each of the following in
form and substance satisfactory to the Administrative Agent:




          (i) (a) this Agreement, executed and delivered by the Administrative Agent, the Lenders and
the Borrower, (b) the Notes executed and delivered by the Borrower, (c) the Guarantee and
Collateral Agreement, executed and delivered by the Borrower, Holdings and each other Guarantor,
(d) an Acknowledgement and Consent in the form attached to the Guarantee and Collateral Agreement,
executed and delivered by each Issuer (as defined therein), if any, that is not a Loan Party and
(e) the completed Perfection Certificate executed and delivered by the Borrower and the other Loan
Parties;




          (ii) (a) the Pro Forma Balance Sheet, (b) audited consolidated financial statements of the
Borrower for the fiscal year ending December 31, 2009, (c) unaudited consolidated financial
statements of the Borrower for each fiscal quarter ended after the latest fiscal year referred to
in clause (b) above through the fiscal quarter ended September 30, 2010 and thereafter, as such
financial statements are available, and unaudited consolidated financial statements for the same
period of the prior fiscal year and (d) to the extent available to management prior to the Closing
Date, monthly financial data generated by the Borrower’s internal accounting systems for use by
senior and financial management for each month after the latest fiscal quarter for which financial
statements have been received pursuant to clause (b) above;




          (iii) evidence that all governmental and third party approvals necessary in connection with
the continuing operations of the Group Members and the transactions contemplated hereby shall have
been obtained and be in full force and effect;




          (iv) results of a recent lien search in each jurisdiction where a Loan Party is organized and
where a Loan Party maintains its chief executive office, and such searches shall reveal no liens on
any of the assets of the Loan Parties except for liens permitted by Section 7.2.2 or discharged on
or prior to the Closing Date pursuant to documentation reasonably satisfactory to the
Administrative Agent;




          (v) received all fees required to be paid to the Administrative Agent and the Lenders, and all
expenses required to be reimbursed for which invoices have been presented (including the reasonable
fees and expenses of legal counsel), on or before the Closing Date;




          (vi) evidence reasonably satisfactory to it that the Existing Credit Agreement has been
terminated and all amounts then due and payable thereunder have been satisfied in full and all
Liens securing the Indebtedness thereunder have been released;




          (vii) executed legal opinions from Paul, Weiss Rifkind, Wharton & Garrison LLP, counsel to the
Borrower and the other Loan Parties in each case covering such matters incident to the transactions
contemplated by this Agreement as the Administrative Agent may reasonably require;




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




          (ix) each document (including any Uniform Commercial Code financing statement) required by the
Security Documents or under law or reasonably requested by the Administrative Agent to be filed,
registered or recorded in order to create in favor of the Administrative Agent, for the benefit of
the Lenders, a perfected Lien on the Collateral described therein, prior and superior in right to
any other Person (other than with respect to Liens expressly permitted by Section 7.2.2), shall be
in proper form for filing, registration or recordation;




          (x) insurance certificates satisfying the requirements of Section 5.2(b) of the Guarantee and
Collateral Agreement;




          (xi) a certificate of each of the Loan Parties signed by an Authorized Officer, dated the
Closing Date stating that (a) all representations and warranties of the Loan Parties set forth in
this Agreement are true and correct (x) in the case of representations and warranties qualified by
materiality, in all respects and (y) otherwise, in all material respects, (b) the Loan Parties are
in compliance with each of the covenants and conditions hereunder, (c) no Event of Default or
Potential Default exists, and (d) no Material Adverse Effect has occurred since September 30, 2010;




          (xii) a certificate dated the Closing Date and signed by the Secretary or an Assistant
Secretary of each of the Loan Parties, certifying as appropriate as to: (a) all corporate action
taken by each Loan Party in connection with this Agreement and the other Loan Documents; (b) the
names of the Authorized Officers of such Loan Party authorized to sign the Loan Documents and their
true signatures; and (c) copies of its organizational documents as in effect on the Closing Date
certified by the appropriate state official where such documents are filed in a state office
together with certificates from the appropriate state officials as to the continued existence and
good standing of each Loan Party in the state where organized;




          (xiii) a solvency certificate from the chief financial officer of Holdings and the Borrower,
in form and substance reasonably acceptable to the Administrative Agent;




          (xiv) a pro forma compliance certificate in a form reasonably acceptable to the Administrative
Agent; and




          (xv) such other documents in connection with such transactions as the Administrative Agent or
said counsel may reasonably request.




     6.2 Each Loan or Letter of Credit. At the time of making any Loans or issuing, extending or increasing any Letters of Credit and
after giving effect to the proposed extensions of credit: (i) the representations, warranties of
each Loan Party set forth in the Loan Document shall be true and correct (x) in the case of
representations and warranties qualified by materiality, in all respects and (y) otherwise, in all
material respects, in each case on and as of such date as if






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made on and as of such date (except to the extent that such representations and warranties
relate to an earlier date in which case such representations and warranties that expressly relate
to an earlier date are true and correct, in the case of such representations and warranties
qualified by materiality, in all respects, and otherwise in all material respects, as of such
earlier date), (ii) no Event of Default or Potential Default shall have occurred and be continuing,
and (iii) the Borrower shall have delivered to the Administrative Agent a duly executed and
completed Loan Request or to the Issuing Lender an application for a Letter of Credit, as the case
may be.



Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower hereunder shall
constitute a representation and warranty by the Borrower as of the date of such extension of credit
that the conditions contained in this Section 6.2 have been satisfied.




7. COVENANTS




     The Borrower covenants and agrees that until Payment In Full, the Borrower shall, and shall
cause Holdings and each of the Borrower’s and Holdings’ Subsidiaries to:



     7.1 Affirmative Covenants.



          7.1.1 Financial Statements. Furnish to each Lender, through the Administrative Agent:




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




          (ii) as soon as available, but in any event not later than 45 days after the end of each of
the first three quarterly periods of each fiscal year of the Borrower, the unaudited consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as at the end of such quarter and
the related unaudited consolidated statements of income and of cash flows for such quarter and the
portion of the fiscal year through the end of such quarter, setting forth in each case in
comparative form the figures for the previous year, certified by an Authorized Officer as being
fairly stated in all material respects (subject to normal year-end audit adjustments).



All such financial statements shall (a) be complete and correct in all material respects and shall
be prepared in reasonable detail and in accordance with GAAP applied consistently throughout the
periods reflected therein and with prior periods (except as approved by such accountants or
officer, as the case may be, and disclosed therein) and (b) reflect, whether as a line item, in a
footnote or otherwise, the adjustments to Consolidated EBITDA described in clauses (a)(i) through
(viii) and (b)(i) through (v), as applicable, of that definition, for the applicable period.







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          7.1.2 Certificates; Other Information. Furnish to each Lender, through the Administrative Agent (or, in the case of clause (iv),
to the relevant Lender):




          (i) [intentionally omitted];




          (ii) concurrently with the delivery of any financial statements pursuant to Section 7.1.1, (a)
a certificate of an Authorized Officer stating that such Authorized Officer has obtained no
knowledge of any Potential Default or Event of Default that occurred during such period except as
specified in such certificate, (b) a compliance certificate containing all information and
calculations necessary for determining compliance by the Borrower with Section 7.2.1 as of the last
day of the fiscal quarter or fiscal year of the Borrower, as the case may be (each, a “Compliance
Certificate”), and (c) to the extent not previously disclosed to the Administrative Agent, a
listing of any Intellectual Property registered, issued or subject to a pending application for
registration or issuance and acquired by any Loan Party since the date of the most recent list
delivered pursuant to this clause (or, in the case of the first such list so delivered, since the
Closing Date);




          (iii) as soon as available, and in any event no later than 60 days after the end of each
fiscal year of the Borrower, a detailed consolidated budget for the following fiscal year
(including a projected consolidated balance sheet of the Borrower and its Subsidiaries as of the
end of the following fiscal year, the related consolidated statements of projected cash flow and
projected income and a description of the underlying assumptions applicable thereto), and, as soon
as available, significant revisions, if any, of such budget and projections with respect to such
fiscal year (collectively, the “Projections”), which Projections shall in each case be accompanied
by a certificate of an Authorized Officer stating that such Projections are based on reasonable
estimates, information and assumptions and that such Authorized Officer has no reason to believe
that such Projections are incorrect or misleading in any material respect;




          (iv) within five days after the same are sent, copies of all financial statements and reports
that Holdings or the Borrower sends to the holders of any class of its debt securities or public
equity securities and, within five days after the same are filed, copies of all financial
statements and reports that Holdings or the Borrower may make to, or file with, the SEC;




          (v) concurrently with the delivery of the financial statements (a) under Section 7.1.1(i), to
the extent applicable, notice of any material change in GAAP or in the application thereof, in each
case, with respect to the consolidated financial statements of the Borrower, that has occurred
since the date of the consolidated balance sheet of the Borrower most recently delivered pursuant
to Section 7.1.1(i), and (b) under Section 7.1.1(i) or (ii), any change by the Borrower to
International Financial Reporting Standards; and




          (vi) promptly, such additional available financial and other information with regard to any
Group Member as any Lender may from time to time reasonably request.




          7.1.3 Payment of Obligations. Pay, discharge or otherwise satisfy at or before maturity or before they become delinquent,
as the case may be, all its material obligations (excluding Indebtedness) of whatever nature,
including obligations in respect of Taxes, except where the amount or validity thereof is currently
being contested in good faith by appropriate






- 60 -









 







proceedings and reserves in conformity with GAAP with respect thereto have been provided on
the books of the relevant Group Member; provided, however, notwithstanding the foregoing, in the
case of obligations in respect of Taxes, the Borrower and each other Group Member shall pay,
discharge or otherwise satisfy any such Tax obligations (i) upon the commencement of enforcement or
foreclosure proceedings with respect to any Lien securing any such Tax obligations and (ii) where
the failure to make such payment or the failure to discharge or otherwise satisfy any such Tax
obligations pending resolution of any contest of such Tax obligations could reasonably be expected
to result in a Material Adverse Effect. Notwithstanding anything to the contrary in the foregoing
sentence, the Borrower shall not be in default under this Section 7.1.3 unless the aggregate amount
of non-contested obligations which the Group Members have so failed to pay, discharge or satisfy
before they become delinquent and which remain delinquent at the time of determination is more than
$3,000,000 in the aggregate.




          7.1.4 Maintenance of Existence; Compliance. (i)(a) Preserve, renew and keep in full force and effect its organizational existence and
(b) take all reasonable action to maintain all rights, privileges and franchises necessary or
desirable in the normal conduct of its business, except, in each case, as otherwise permitted by
Section 7.2.4 and Section 7.2.5 and except, in the case of clause (b) above, to the extent that
failure to do so could not reasonably be expected to have a Material Adverse Effect; and (ii)
comply with all Contractual Obligations and Requirements of Law except to the extent that failure
to comply therewith could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.




          7.1.5 Maintenance of Property; Insurance. (i) Keep all property useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted, except where the failure to do so would not, in the
aggregate, be reasonably likely to have a Material Adverse Effect, and (ii) maintain with
financially sound and reputable insurance companies insurance on all its property in at least such
amounts and against at least such risks (but including in any event public liability, product
liability and business interruption) as are usually insured against in the same general area by
companies engaged in the same or a similar business (taking into account the availability of such
insurance in certain geographic regions where such property may be located).




          7.1.6 Inspection of Property; Books and Records; Discussions. (i) Keep proper books of records and accounts in which full, true and correct entries in
conformity with GAAP and in all material respects with all Requirements of Law shall be made of all
dealings and transactions in relation to its business and activities and (ii) permit
representatives of (a) the Administrative Agent and (b) any Lender in coordination with the
Administrative Agent to visit and inspect any of its properties and examine and make abstracts from
any of its books and records it may reasonably request at any reasonable time and as often as may
reasonably be desired and to discuss the business, operations, properties and financial and other
condition of the Group Members with officers and employees of the Group Members and, after
reasonable notice to the Borrower, with their independent certified public accountants with the
participation, if requested by a Group Member, of such Group Member.




          7.1.7 Notices. Promptly give notice to the Administrative Agent and each Lender of:







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          (i) the occurrence of any Potential Default or Event of Default, including any Change in
Control;




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




          (iii) any litigation or proceeding affecting any Group Member (a) in which it could be
reasonably expected, in the good faith opinion of such Group Member, to result in such Group Member
incurring a liability of $3,000,000 or more and not covered by insurance, (b) in which injunctive
or similar relief is sought which could reasonably be expected to have a Material Adverse Effect or
(c) which relates to any Loan Document;




          (iv) (a) the occurrence of any ERISA Event, a failure to make any required contribution to a
Plan or a Multiemployer Plan, the creation of any Lien in favor of the PBGC or a Plan or any
withdrawal from, or the termination, Reorganization or Insolvency of, any Multiemployer Plan or (b)
the institution of proceedings or the taking, or expected taking, of any other action by the PBGC
or the Borrower or any ERISA Affiliate or any Multiemployer Plan with respect to the withdrawal
(including any partial withdrawal) from, or the termination, Reorganization or Insolvency of, any
Plan; and




          (v) any development or event that has had or could reasonably be expected to have a Material
Adverse Effect.



Each notice pursuant to this Section 7.1.7 shall be accompanied by a statement of an Authorized
Officer setting forth details of the occurrence referred to therein and stating what action the
relevant Group Member proposes to take with respect thereto.




          7.1.8 Environmental Laws. (i) Comply with, and ensure compliance by all tenants and subtenants, if any, with, all
applicable Environmental Laws, and obtain and comply with and maintain, and ensure that all tenants
and subtenants obtain and comply with and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental Laws, except in each case to the
extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.




          (ii) Conduct and complete all investigations, studies, sampling and testing, and all remedial,
removal and other actions required under Environmental Laws and promptly comply with all lawful
orders and directives of all Official Bodies regarding Environmental Laws, except (a) to the extent
that the failure to perform any of the obligations contained in this Section 7.1.8(ii) could not
reasonably be expected to have a Material Adverse Effect or (b) to the extent that such obligations
are being contested in good faith by appropriate proceedings and the pendency of such proceedings
could not reasonably be expected to have a Material Adverse Effect.




          7.1.9 Additional Collateral, etc. (i) With respect to any property acquired after the Closing Date by any Loan Party that
constitutes Collateral (as defined in the Guarantee and Collateral Agreement) as to which the
Administrative Agent, for the benefit of the Lenders, does






- 62 -









 







not have a perfected Lien, promptly (a) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement or such other documents as the Administrative
Agent deems necessary or reasonably advisable to grant to the Administrative Agent, for the benefit
of the Lenders, a security interest in such property as required by the Guarantee and Collateral
Agreement and (b) take all actions deemed necessary or reasonably advisable by the Administrative
Agent to grant to the Administrative Agent, for the benefit of the Lenders, a perfected first
priority security interest in such Collateral to the extent contemplated by the Guarantee and
Collateral Agreement, including the filing of Uniform Commercial Code financing statements in such
jurisdictions as may be required by the Guarantee and Collateral Agreement or by Law or as may be
requested by the Administrative Agent.




          (ii) With respect to any new Subsidiary (other than a Foreign Subsidiary) created or acquired
after the Closing Date as a direct Subsidiary of any Loan Party, promptly (a) execute and deliver
to the Administrative Agent such amendments to the Guarantee and Collateral Agreement as the
Administrative Agent deems necessary or reasonably advisable to grant to the Administrative Agent,
for the benefit of the Lenders, a perfected first priority security interest in the Capital Stock
of such new Subsidiary that is owned by any Loan Party, (b) deliver to the Administrative Agent the
certificates, if any, representing such Capital Stock, together with undated stock powers, in
blank, executed and delivered by a duly authorized officer of the relevant Loan Party, (c) cause
such new Subsidiary (I) to become a party to the Guarantee and Collateral Agreement, (II) to take
such actions necessary or reasonably advisable to grant to the Administrative Agent for the benefit
of the Lenders a perfected first priority security interest in the Collateral described in the
Guarantee and Collateral Agreement with respect to such new Subsidiary to the extent contemplated
by the Guarantee and Collateral Agreement, including the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Guarantee and Collateral
Agreement or by law or as may be requested by the Administrative Agent and (III) to deliver to the
Administrative Agent a certificate of such Subsidiary, substantially in the form of the certificate
delivered pursuant to Section 6.1.1(viii), with appropriate insertions and attachments, and (d) if
requested by the Administrative Agent, deliver to the Administrative Agent legal opinions relating
to the matters described above, which opinions shall be in form and substance (but generally within
the scope of the legal opinion delivered pursuant to Section 6.1.1(vii), and from counsel,
reasonably satisfactory to the Administrative Agent.




          (iii) With respect to (x) any new Foreign Subsidiary (other than any Immaterial Foreign
Subsidiary) created or acquired after the Closing Date as a direct Subsidiary of any Loan Party or
(y) any Immaterial Foreign Subsidiary that is a direct Subsidiary of a Loan Party and ceases to be
an Immaterial Foreign Subsidiary after the Closing Date, promptly (a) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement as the
Administrative Agent deems necessary or reasonably advisable to grant to the Administrative Agent,
for the benefit of the Lenders, a perfected first priority security interest in the Capital Stock
of such Subsidiary that is owned by any such Loan Party (provided that in no event shall more than
66% of the total outstanding voting Capital Stock of any such Subsidiary be required to be so
pledged), (b) deliver to the Administrative Agent the certificates, if any, representing such
Capital Stock, together with undated stock powers, in blank, executed and delivered by a duly
authorized officer of the relevant Group Member, and take such other action as the Administrative
Agent may deem necessary or reasonably advisable to perfect the






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Administrative Agent’s security interest therein, and (c) if requested by the Administrative
Agent, deliver to the Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.




          (iv) Notwithstanding the foregoing, this Section 7.1.9 shall not require the creation or
perfection of pledges of or security interests in, or the obtaining of legal opinions or other
deliverables with respect to, particular assets of the Loan Parties, or the provision of any
Guaranty by any Subsidiary, if, and for so long as the Administrative Agent, in consultation with
the Borrower, determines that the cost of creating or perfecting such pledges or security interests
in such assets, or obtaining such legal opinions or other deliverables in respect of such assets,
or providing such Guarantees (taking into account any adverse tax consequences to the Borrower and
its Subsidiaries (including the imposition of withholding or other material taxes)), shall be
excessive in view of the benefits to be obtained by the Lenders therefrom. The Administrative
Agent may grant extensions of time for the creation and perfection of security interests in or the
obtaining of legal opinions or other deliverables with respect to particular assets or the
provision of any Guaranty by any Subsidiary (including extensions beyond the Closing Date or in
connection with assets acquired, or Subsidiaries formed or acquired, after the Closing Date) where
it determines that such action cannot be accomplished without undue effort or expense by the time
or times at which it would otherwise be required to be accomplished by this Agreement or the
Security Documents.




          7.1.10 Intentionally Omitted




          7.1.11 Further Assurances. Each Loan Party shall, from time to time, at its expense, faithfully preserve and protect
the Administrative Agent’s Lien on and first priority security interest in the Collateral whether
now owned or hereafter acquired as a continuing first priority perfected Lien to the extent
contemplated by the Guarantee and Collateral Agreement, subject only to Permitted Exceptions, and
shall do such other acts and things as the Administrative Agent in its discretion may deem
necessary or reasonably advisable from time to time in order to preserve, perfect and protect the
Liens granted under the Loan Documents and to exercise and enforce its rights and remedies
thereunder with respect to the Collateral.




          7.1.12 Anti-Terrorism Laws. None of the Loan Parties is or shall be (i) a Person with whom any Lender is restricted
from doing business under Executive Order No. 13224 or any other Anti-Terrorism Law, (ii) engaged
in any business involved in making or receiving any contribution of funds, goods or services to or
for the benefit of such a Person or in any transaction that evades or avoids, or has the purpose of
evading or avoiding, the prohibitions set forth in any Anti-Terrorism Law, or (iii) otherwise in
violation of any Anti-Terrorism Law. The Loan Parties shall provide to the Lenders any
certifications or information that a Lender requests to confirm compliance by the Loan Parties with
Anti-Terrorism Laws.




          7.1.13 Operating Accounts. Each of the Loan Parties shall maintain their principal deposit accounts with PNC so long
as PNC is the Administrative Agent and, if PNC ceases to be the Administrative Agent, use
commercially reasonable efforts to enter into control agreement(s) with respect to their primary
deposit accounts (such control agreements to be in a form and substance reasonably acceptable to
the successor Administrative Agent), for the benefit






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of the Administrative Agent and the other Secured Parties (as defined in the Guarantee and
Collateral Agreement).




     7.2 Negative Covenants. The Borrower covenants and agrees that until Payment in Full, the Borrower shall not, and
shall not permit Holdings or any of the Borrower’s or Holdings’ Subsidiaries to, directly or
indirectly:



          7.2.1 Financial Covenants.




          (i) Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio as of the
last day of any fiscal quarter, commencing with the fiscal quarter ending December 31, 2010, to
exceed 2.25 to 1.0.




          (ii) Consolidated Interest Coverage Ratio. Permit the Consolidated Interest Coverage
Ratio as of the last day of any fiscal quarter, commencing with the fiscal quarter ending December
31, 2010, to be less than 5.5 to 1.0.




          (iii) Capital Expenditures: Make or commit to make any Capital Expenditure, except
Capital Expenditures of the Borrower and its Subsidiaries in the ordinary course of business not
exceeding $3,500,000 in the aggregate in any fiscal year commencing with the fiscal year ending
December 31, 2010; provided, that the amount of Capital Expenditures permitted for any fiscal year,
commencing with the fiscal year ending December 31, 2011, shall be increased by an amount equal to
the excess, if any, of (a) the unused permitted Capital Expenditures for the immediately preceding
fiscal year to the extent not in excess of $500,000 over (b) an amount equal to the amount of
unused permitted Capital Expenditures, if any, carried forward to such preceding year.




          7.2.2 Limitation on Liens. Create, incur, assume or suffer to exist any Lien upon any of their properties, assets
(including shares of Capital Stock) or revenues, whether now owned or hereafter acquired, except
for the following (collectively, “Permitted Exceptions”):




          (i) Liens for taxes not yet due or which are being contested in good faith and by appropriate
proceedings if adequate reserves with respect thereto are maintained on the books of the Borrower
or any of its Subsidiaries, as the case may be, in accordance with GAAP;




          (ii) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens
arising in the ordinary course of business which are not overdue for a period of more than 30 days
or which are being contested in good faith and by appropriate proceedings;




          (iii) pledges or deposits in connection with workmen’s compensation, unemployment insurance
and other social security legislation;




          (iv) deposits to secure the performance of bids, trade contracts (other than for borrowed
money), government contracts, leases, statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred and statutory or contractual bankers’ Liens
on monies held in bank accounts in the ordinary course of business;







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          (v) easements, servitudes, covenants, conditions, reservations, licenses, agreements,
rights-of-way, restrictions and other similar encumbrances incurred in the ordinary course of
business and encumbrances consisting of zoning restrictions, easements, licenses, survey defects,
restrictions on the use of property or minor defects or irregularities in title thereto which, in
the aggregate, are not substantial in amount and which do not in any case materially detract from
the value of the property subject thereto or materially interfere with the ordinary conduct of the
business of the Borrower or any of its Subsidiaries;




          (vi) Liens created pursuant to the Security Documents;




          (vii) Liens in favor of the United States for amounts paid by the Borrower or any of its
Subsidiaries as progress payments under government contracts entered into by them;




          (viii) any interest or title of a lessor under any lease entered into by the Borrower or any
other Subsidiary in the ordinary course of its business and covering only the assets so leased;




          (ix) attachment, judgment or other similar Liens arising in connection with court or
arbitration proceedings, provided that the same are discharged, or that execution or enforcement
thereof is stayed pending appeal, within 30 days or (in the case of any execution or enforcement
pending appeal) such lesser time during which such appeal may be taken;




          (x) Liens granted in the ordinary course of business of the Borrower or any of its
Subsidiaries in favor of issuers of documentary or trade letters of credit for the account of the
Borrower or such Subsidiary which support the purchase and/or importation of inventory of the
Borrower and its Subsidiaries, which Liens secure the reimbursement obligations of the Borrower or
such Subsidiary on account of such letters of credit; provided that each such Lien is limited to
(i) the assets acquired or shipped with the support of such letter of credit and (ii) any assets of
the Borrower or such Subsidiary which are in the care, custody or control of such issuer in the
ordinary course of business;




          (xi) possessory Liens in favor of brokers and dealers arising in connection with the
acquisition or disposition of investments of the type permitted by Section 7.2.7(i)(b); provided
that such Liens (i) attach only to such investments and (ii) secure only obligations incurred in
the ordinary course and arising in connection with the acquisition or disposition of such
investments and not any obligation in connection with margin financing;




          (xii) Liens set forth in Schedule 7.2.2(xii);




          (xiii) Liens on the assets of any Foreign Subsidiary securing Indebtedness of such Foreign
Subsidiary permitted by Section 7.2.10(vi) or other obligations of such Foreign Subsidiary;




          (xiv) Liens securing Indebtedness incurred pursuant to Section 7.2.10(vii) to purchase or
finance the purchase of real or personal property or to refinance, refund, renew or extend any such
Indebtedness; provided that (i) such Liens shall be created substantially simultaneously with the
purchase of such property or such refinancing, refunding, renewal or extension, (ii) such Liens do
not at any time encumber any property other than the property






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financed by such Indebtedness, (iii) the amount of Indebtedness secured by such Lien is not
increased and (iv) the principal amount of Indebtedness secured by any such Lien shall at no time
exceed 100% of the purchase price of such property;




          (xv) Liens on the property of a Person which becomes a Subsidiary after the date hereof
securing Indebtedness of such Subsidiary permitted under Section 7.2.10(viii) (provided that (i)
such Liens existed at the time such Person became a Subsidiary and were not incurred in
anticipation thereof or secure refinancing Indebtedness permitted under Section 7.2.10(viii), (ii)
immediately after giving effect to the acquisition of such Person, no Potential Default or Event of
Default shall have occurred and be continuing, (iii) any such Lien is not spread to cover any other
property (or other categories of property) of such Person after the time such Person becomes a
Subsidiary and (iv) the amount of the Indebtedness secured thereby is not increased;




          (xvi) Intellectual Property licensing agreements entered into in the ordinary course of
business;




          (xvii) Liens in favor of customs and revenue authorities to secure payment of customs duties
in connection with the importation of goods in the ordinary course of business;




          (xviii) any extension, renewal or replacement of the foregoing; provided that the Liens
permitted by this paragraph shall not extend to or cover any additional Indebtedness or property
(other than a substitution of like property); and




          (xix) other Liens that do not, individually or in the aggregate, secure obligations in excess
of $1,500,000 outstanding at any time; provided, that such any such Lien on any Collateral shall
not be senior to the Administrative Agent’s Liens thereon.




          7.2.3 Limitation on Guarantee Obligations. Agree to, or assume or incur, or otherwise in any way be or become responsible or liable,
directly or indirectly, with respect to, any Guarantee Obligation other than:




          (i) Guarantee Obligations pursuant to the Guarantee and Collateral Agreement;




          (ii) Guarantee Obligations of any Subsidiary of the Borrower in the nature of a guarantee of
Indebtedness or other obligations of the Borrower or any other Wholly Owned Subsidiary of the
Borrower (including, without limitation, any Wholly Owned Subsidiary incurring such Guarantee
Obligations);




          (iii) Guarantee Obligations of any Person which becomes a Subsidiary after the date hereof,
provided that (i) such Guarantee Obligations existed at the time such Person became a Subsidiary
and were not created in anticipation thereof; (ii) immediately after giving effect to the
acquisition of such Person, no Potential Default or Event of Default shall have occurred or be
continuing and (iii) the amount thereof does not result in a violation of Section 7.2.7(vii);







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          (iv) Guarantee Obligations of the Borrower in the nature of guarantees of Indebtedness or
other obligations of any of its Wholly Owned Subsidiaries to the extent such Indebtedness or other
obligations, as the case may be, is not prohibited by this Agreement;




          (v) Guarantee Obligations pursuant to the indemnification provisions of the Assignment and
Assumption Agreement; and




          (vi) Guarantee Obligations permitted pursuant to Section 7.2.7(vi).




          7.2.4 Limitation on Fundamental Changes. Enter into any transaction in the nature of merger or consolidation or amalgamation, or
liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), Dispose of, in
one transaction or a series of related transactions, all or substantially all of the business or
assets of the Borrower, or enter into any such transaction or series of related transactions with
regard to a group of Subsidiaries which, if merged into a single Subsidiary, would constitute a
substantial part of the business or assets of the Borrower, or acquire by purchase or otherwise all
or substantially all the business or assets of, or Capital Stock or other evidences of beneficial
ownership of, any Person, except that:




          (i) any Subsidiary of the Borrower (i) may be merged or consolidated with or into, or its
assets liquidated and distributed to, the Borrower, provided that the Borrower shall be the
continuing or surviving corporation or (ii) may be merged or consolidated with or into, or its
assets liquidated and distributed to, any one or more Wholly Owned Subsidiaries of the Borrower;
provided that no Domestic Subsidiary may be merged or consolidated with or into a Foreign
Subsidiary unless a Domestic Subsidiary is the continuing or surviving entity and no Domestic
Subsidiary may have its assets liquidated and distributed to any Foreign Subsidiary;




          (ii) any Subsidiary of the Borrower may Dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to the Borrower or a Wholly Owned Subsidiary of the Borrower and, in the
event such Subsidiary shall so Dispose of all of its assets, such Subsidiary may liquidate, wind up
or dissolve; provided that no Domestic Subsidiary may Dispose of any of its assets to any Foreign
Subsidiary other than in the ordinary course of business;




          (iii) the Borrower and its Subsidiaries may make acquisitions, investments and purchases
permitted by Section 7.2.7; and




          (iv) any Foreign Subsidiary that does not have any property may liquidate, wind up or
dissolve.




          7.2.5 Limitation on Sale of Assets. Dispose of any of its assets (including, without limitation, receivables and leasehold
interests), whether now owned or hereafter acquired, or, in the case of any of the Subsidiaries of
the Borrower, issue any shares of Capital Stock (other than any director’s qualifying shares), to
any Person other than the Borrower or any of its Subsidiaries, except:




          (i) as permitted by Sections 7.2.2, 7.2.4, 7.2.6 or 7.2.7;







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          (ii) the sale or other disposition (including abandonment) of any property (including
Intellectual Property rights) which has become uneconomic, obsolete or worn out and which is
disposed of in the ordinary course of business;




          (iii) the sale of inventory in the ordinary course of business;




          (iv) Intellectual Property licensing agreements entered into in the ordinary course of
business;




          (v) Dispositions of Cash and Cash Equivalents in the ordinary course of business;




          (vi) any transfer of property or assets that represents a surrender or a waiver of a contract
right or a settlement, surrender or release of a contract or tort claim;




          (vii) the lease or sublease of any real property interest that is not useful in the business
of the Borrower or any Subsidiary;




          (viii) Dispositions of investments in joint ventures to the extent required by, or made
pursuant to, customary buy/sell arrangements between joint venture parties; and




          (ix) Dispositions of property not having a value, together with all other Dispositions
pursuant to this clause (ix), in excess of $5,000,000 during the term of this Agreement.




          7.2.6 Limitation on Restricted Payments. Make any Restricted Payment, except that the following Restricted Payments may be made:




          (i) Restricted Payments to Holdings in amounts equal to the amounts required for Holdings to
pay franchise and similar taxes and other fees required to maintain its corporate existence;




          (ii) Restricted Payments necessary for M & F Worldwide and PCT International Holdings Inc. to
pay (i) franchise and similar taxes, (ii) other fees required to maintain its corporate existence,
and (iii) other out-of-pocket expenses incurred in the ordinary course of business resulting from M
& F Worldwide’s status as a publicly held corporation in an amount not exceeding in the aggregate
$2,000,000 during any fiscal year;




          (iii) Restricted Payments as required by the Tax Agreement;




          (iv) Restricted Payments by any Subsidiary to its parent company so long as such parent
company is the Borrower or a Wholly Owned Subsidiary;




          (v) Restricted Payments in the form of distributions by the Borrower and Holdings of
intercompany advances made by the Borrower to M & F Worldwide after the date hereof pursuant to
Section 7.2.6(ii);







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          (vi) so long as no Potential Default or Event of Default shall have occurred and be
continuing, other Restricted Payments not to exceed $500,000 in the aggregate in any fiscal year;
and




          (vii) after delivery to the Lenders of the Borrower’s annual audited financial statements
pursuant to Section 5.1.1 for any fiscal year and a certificate signed by an Authorized Officer of
the Borrower detailing the calculation of Excess Cash Flow for the immediately preceding fiscal
year, and so long as no Potential Default or Event of Default shall have occurred and be
continuing, additional Restricted Payments in an aggregate amount equal to the difference between
(a) fifty percent (50%) of Excess Cash Flow for such immediately preceding fiscal year and (b)
without duplication of any deductions in the determination of Excess Cash Flow, the aggregate
amount of advances to or investments in suppliers made by the Borrower and its Subsidiaries in such
immediately preceding fiscal year net of any repayments by suppliers of such investments or
advances in such immediately preceding fiscal year.




          7.2.7 Limitation on Investments, Loans, Advances and Acquisitions. Make or commit to make any advance, loan, extension of credit or capital contribution to,
or purchase any Capital Stock, bonds, notes, debentures or other securities of, or any assets
constituting a business unit of, or make any other investment in, any Person (other than the
Borrower or any of its Subsidiaries), except:




          (i) investments by the Borrower and its Subsidiaries in accounts, contract rights and chattel
paper (as defined in the Uniform Commercial Code), put and call foreign exchange options and
foreign exchange forwards and futures to the extent necessary to hedge foreign exchange exposures
and notes receivable, arising or acquired in the ordinary course of business and in Hedge
Agreements and;




          (ii) investments in Cash Equivalents;




          (iii) investments by Foreign Subsidiaries in investments of a type similar to Cash Equivalents
made outside of the United States;




          (iv) extensions of trade credit in the ordinary course of business;




          (v) the Borrower and its Subsidiaries may acquire and own investments (including debt
obligations) received in connection with the bankruptcy or reorganization of suppliers and
customers or in settlement of delinquent obligations of, and other disputes with, customers and
suppliers arising out of the ordinary course of business; provided that the Borrower and its
Subsidiaries have paid no new consideration (other than forgiveness of Indebtedness or other
obligations) therefor;




          (vi) (a)(1) advances, loans and other extensions of credit (including by way of Guaranty) to
suppliers for financing raw material collections and raw material collection operations, reduced by
the value of goods actually received by the Borrower and its Subsidiaries (net of any payments by a
Group Member for such goods), (2) investments in joint venture operations reduced by the fair
market value of any assets actually received by the Borrower and its Subsidiaries from such joint
venture operations (net of any payments by a Group Member for such assets), and (3) acquisitions of
manufacturing technology, licenses and other intellectual






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property, in each such case in the ordinary course of business, and in an aggregate amount not
exceeding in $30,000,000 at any time outstanding for all such advances, loans, extensions of
credit, investments and acquisitions made under this Section 7.2.7(vi)(a), and (b) advances, loans,
extensions of credit (including by way of Guaranty), capital contributions and other investments in
other Persons not to exceed in the aggregate, when added to the outstanding amount of Guarantee
Obligations incurred pursuant to Section 7.2.3(iii), $5,000,000 in the aggregate outstanding at any
time (and such investments to be measured by their fair market value at the time of the
investment). For the sake of clarity, it is understood that with respect to clause (a) or (b)
above all calculations of the aggregate amount of the advances, loans, extensions of credit
(including by way of Guaranty), capital contributions and other investments outstanding at such
time shall be reduced by (I) any cash refunds or repayments of such advances, loans or extensions
of credit and (II) any cash distributions made on account of such capital contributions and
investments;




          (vii) investments pursuant to the contribution and indemnification provisions of the Mafco
Assignment and Assumption Agreement;




          (viii) loans and advances to officers, directors and employees in the ordinary course of
business (including, without limitation, for travel, entertainment and relocation expenses) not to
exceed $1,000,000 in the aggregate at any time outstanding;




          (ix) Permitted Acquisitions; and




          (x) Restricted Payments permitted by Section 7.2.6.




          7.2.8 Sale and Leaseback. Enter into any arrangement with any Person whereby the Borrower shall sell or transfer any
property, real or personal, whether now owned or hereafter acquired, and thereafter rent or lease
such property.




          7.2.9 Limitation on Transactions with Affiliates. Enter into any transaction (including, without limitation, any purchase, sale, lease or
exchange of property or the rendering of any service) with any Affiliate of the Borrower (other
than the Borrower or any Wholly Owned Subsidiary of the Borrower) other than, to the extent not
otherwise prohibited by this Agreement, (i) transactions that are in the ordinary course of
business and are upon terms no less favorable to the Borrower or such Subsidiary, as the case may
be, than it would obtain in a comparable arm’s length transaction with a Person not an Affiliate,
(ii) transactions contemplated by the Tax Agreement, (iii) Restricted Payments permitted by Section
7.2.6, (iv) any transaction with a joint venture between the Borrower or any of its Subsidiaries,
on the one hand, and a third party that is not directly or indirectly controlled by an Affiliate of
the Borrower, on the other hand, (v) arrangements with officers, directors, representatives,
consultants and employees of Holdings, the Borrower and their Subsidiaries relating to their
employment and benefits as such, (vi) any transaction pursuant to which an Affiliate of the
Borrower will provide to the Borrower and its Subsidiaries at their request and at the cost of such
Affiliate certain allocated services, including services to be purchased from third party
providers, such as legal and accounting services, tax, consulting, financial advisory, corporate
governance, insurance coverage and other services and (vii) payments by the Borrower or a
Subsidiary of the Borrower to an Affiliate of the Borrower for any financial advisory, financing,
underwriting or placement






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services or in respect of other investment banking activities, including in connection with
acquisitions or divestitures, which payments are approved by a majority of the members of the Board
of Directors of the Borrower in good faith.




          7.2.10 Indebtedness. Create, incur or suffer to exist any Indebtedness except:




          (i) Indebtedness to the Lenders hereunder and under the other Loan Documents;




          (ii) Indebtedness in respect of Hedge Agreements permitted by Section 7.2.12;




          (iii) Indebtedness outstanding on the date hereof and listed in Schedule 7.2.10(iii),
any refinancings, refundings, renewals or extensions thereof that do not increase the principal
amount thereof and other Indebtedness outstanding on the date hereof in an aggregate principal
amount not to exceed $250,000;




          (iv) Indebtedness of (a) Subsidiaries to the Borrower or to other Subsidiaries and (b) the
Borrower to any of its Subsidiaries;




          (v) Indebtedness of the Borrower and its Subsidiaries secured by Liens permitted by Section
7.2.2(xiv) or (xv) hereof;




          (vi) Indebtedness of Foreign Subsidiaries in an aggregate principal amount not to exceed
$7,500,000 at any time outstanding;




          (vii) Indebtedness (including, without limitation, Capital Lease Obligations) secured by a
Lien permitted by Section 7.2.2(xiv), and any refinancings, refundings, renewals or extensions
thereof which in any case does not increase the principal amount thereof, in an aggregate principal
amount not to exceed $3,000,000 at any time outstanding;




          (viii) Indebtedness of any Person that becomes a Subsidiary (or of any Person not previously a
Subsidiary that is merged or consolidated with or into a Subsidiary in a transaction permitted
hereunder) after the date hereof, or Indebtedness of any Person that is assumed by any Subsidiary
in connection with an acquisition of assets by such Subsidiary in a Permitted Acquisition, and any
Indebtedness of such Person that refinances, refunds, renews or extends such Indebtedness so long
as the principal amount of the original Indebtedness is not increased by any such refinancings,
refundings, renewals or extensions; provided that (A) any such original Indebtedness exists
at the time such Person becomes a Subsidiary (or is so merged or consolidated) or such assets are
acquired and is not created in contemplation of or in connection with such Person becoming a
Subsidiary (or such merger or consolidation) or such assets being acquired, (B) the aggregate
principal amount of Indebtedness permitted by this clause (viii) shall not exceed $3,000,000 at any
time outstanding and (C) neither Holdings, the Borrower nor any Subsidiary of the Borrower (other
than such Person or the Subsidiary with which such Person is merged or consolidated or that so
assumes such Person’s Indebtedness) shall Guaranty or otherwise become liable for the payment of
such Indebtedness;




          (ix) earn-outs and post-closing purchase price adjustments in connection with Permitted
Acquisitions consummated after the Closing Date;







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          (x) Indebtedness incurred under a purchase card facility provided by PNC, the aggregate
principal amount under which does not exceed $500,000 at any time outstanding; and




          (xi) additional unsecured Indebtedness of the Borrower or any of its Subsidiaries in an
aggregate principal amount (for the Borrower and all Subsidiaries) not to exceed $4,000,000 at any
one time outstanding.




          7.2.11 Limitation on Modifications of Tax Agreement and Mafco Assignment and Assumption
Agreement. Modify or waive any provision of the Tax Agreement or the Mafco Assignment and Assumption
Agreement, to the extent such amendment, modification or waiver would be reasonably likely to have
a material adverse effect on the interests of the Lenders hereunder and under the other Loan
Documents.




          7.2.12 Hedge Agreements. Enter into any Hedge Agreement, except (i) Hedge Agreements entered into to hedge or
mitigate risks to which the Borrower or any Subsidiary has actual exposure (other than those in
respect of Capital Stock) and (ii) Hedge Agreements entered into in order to effectively cap,
collar or exchange interest rates (from fixed to floating rates, from one floating rate to another
floating rate or otherwise) with respect to any interest-bearing liability or investment of the
Borrower or any Subsidiary.




          7.2.13 Changes in Fiscal Periods. Permit the fiscal year of the Borrower to end on a day other than December 31 or change the
Borrower’s method of determining fiscal quarters.




          7.2.14 Limitation on Negative Pledge Clauses. Enter into with any Person any agreement, other than this Agreement, which prohibits or
limits the ability of the Borrower or any of its Subsidiaries to create, incur, assume or suffer to
exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter
acquired; provided that any of the Borrower and its Subsidiaries may enter into any such agreement
to the extent that (i) such agreement is in connection with a Lien permitted by Section 7.2.2 or a
sale of assets permitted by Section 7.2.5 and any such prohibitions or limitations apply only to
the Property encumbered by such Lien or subject to such sale, (ii) such agreement is a contract,
license or lease which includes customary provisions prohibiting or restricting the granting of
Liens on the rights contained therein and (iii) such agreement relates to a joint venture permitted
hereunder so long as any such prohibition or limitation applies only to the property of such joint
venture.




          7.2.15 Limitation on Lines of Business. Principally engage in any business or activity other than the business conducted by the
Borrower and its Subsidiaries on the Closing Date and businesses and activities reasonably related
thereto.




          7.2.16 Limitation on Restrictions on Subsidiary Distributions. Enter into or suffer to exist or become effective any consensual encumbrance or restriction
on the ability of any Subsidiary of the Borrower to (i) pay dividends or make any other
distributions in respect of any Capital Stock of such Subsidiary held by, or pay any Indebtedness
owed to, the Borrower or any other Subsidiary of the Borrower, (ii) make loans or advances to the
Borrower or any other Subsidiary of the Borrower or (iii) transfer any of its assets to the
Borrower or any other Subsidiary of the Borrower, except for such encumbrances or restrictions
existing under or by






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reason of (a) any restrictions existing under the Loan Documents, (b) any restrictions with
respect to a Subsidiary imposed pursuant to an agreement which has been entered into in connection
with the disposition of all or substantially all of the Capital Stock or assets of such Subsidiary,
(c) any restrictions with respect to the Borrower or any of its Subsidiaries imposed pursuant to an
agreement which has been entered into in connection with a Lien permitted by Section 7.2.2 or a
sale of assets permitted by Section 7.2.5 and any such prohibitions or limitations apply only to
the Property encumbered by such Lien or subject to such sale, (d) customary provisions contained in
a contract, license or lease prohibiting or restricting the assignment, subleasing or sublicensing
thereof, and (e) any restrictions with respect to a joint venture permitted hereunder so long as
such restriction applies only to the property of such joint venture.




8. DEFAULT




     8.1 Events of Default. An Event of Default shall mean the occurrence or existence of any one or more of the
following events or conditions (whatever the reason therefor and whether voluntary, involuntary or
effected by operation of Law):



          8.1.1. the Borrower shall fail to pay any principal of any Loan, Letter of Credit Borrowing or
Reimbursement Obligation when due in accordance with the terms hereof; or the Borrower shall fail
to pay any interest on any Loan, Letter of Credit Borrowing or Reimbursement Obligation, or any
other amount payable hereunder or under any other Loan Document, within five days after any such
interest or other amount becomes due in accordance with the terms hereof; or




          8.1.2. any representation or warranty made or deemed made by any Loan Party herein or in any
other Loan Document or that is contained in any certificate, document or financial or other
statement furnished by it at any time under or in connection with this Agreement or any such other
Loan Document shall prove to have been inaccurate in any material respect on or as of the date made
or deemed made; or




          8.1.3. any Loan Party shall default in the observance or performance of any agreement
contained in clause (a) or (b) of Section 7.1.4(i) (with respect to Holdings and the Borrower
only), Section 7.1.7(i) or Section 7.2 of this Agreement or Sections 5.5 and 5.7(b) of the
Guarantee and Collateral Agreement; or




          8.1.4. any Loan Party shall default in the observance or performance of any other agreement
contained in this Agreement or any other Loan Document (other than as provided in Sections 8.1.1
through 8.1.3 of this Section), and such default shall continue unremedied for a period of 30 days
after the earlier of (i) notice to the Borrower from the Administrative Agent or the Required
Lenders and (ii) an Authorized Officer of any Loan Party becoming aware of such default; or




          8.1.5. any Group Member shall (i) default in making any payment of any principal of any
Indebtedness (including any Guarantee Obligation, but excluding the Loans or any Guarantee
Obligations in respect thereof) on the scheduled or original due date with respect thereto; or (ii)
default in making any payment of any interest on any such Indebtedness beyond






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the period of grace, if any, provided in the instrument or agreement under which such
Indebtedness was created; or (iii) default in the observance or performance of any other agreement
or condition relating to any such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or condition exist, the
effect of which default or other event or condition is to cause, or to permit the holder or
beneficiary of such Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to
cause, with the giving of notice if required (and after giving effect to any applicable cure
period), such Indebtedness to become due prior to its stated maturity or (in the case of any such
Indebtedness constituting a Guarantee Obligation) to become payable; provided, that a default,
event or condition described in clause (i), (ii) or (iii) of this Section 8.1.5 shall not at any
time constitute an Event of Default unless, at such time, one or more defaults, events or
conditions of the type described in clauses (i), (ii) and (iii) of this Section 8.1.5 shall have
occurred and be continuing with respect to Indebtedness the outstanding principal amount of which
exceeds in the aggregate $3,000,000, provided that clause (iii) of this Section 8.1.5 shall not
apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of, or
casualty or condemnation event with respect to, the property or assets securing such Indebtedness,
provided such Indebtedness is paid when due; or




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




          8.1.7. (i) any Person shall engage in any “prohibited transaction” (as defined in Section 406
of ERISA or Section 4975 of the Code) involving any Plan, (ii) there exists a failure to satisfy
the minimum funding standard (as described in Section 412 of the Code and Section 302 of ERISA),
whether or not waived, with respect to any Plan or Multiemployer Plan or any Lien in favor of the
PBGC or a Plan shall arise on the assets of the Borrower or any ERISA Affiliate, (iii) any ERISA
Event shall occur with respect to, or proceedings shall commence to have a trustee appointed, or a
trustee shall be appointed, to administer or to terminate, any Plan, which ERISA Event or
commencement of proceedings or appointment of a trustee is, in the reasonable opinion of the
Required Lenders, likely to result in the termination of such Plan for






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purposes of Title IV of ERISA, (iv) any Plan shall terminate for purposes of Title IV of
ERISA, (v) the Borrower or any ERISA Affiliate shall, or is reasonably expected to, incur any
liability in connection with a withdrawal from, or the Insolvency or Reorganization of, a
Multiemployer Plan or (vi) any other event or condition shall occur or exist with respect to a
Plan; and in each case in clauses (i) through (vi) above, such event or condition, together with
all other such events or conditions, if any, could reasonably be expected to have a Material
Adverse Effect;




          8.1.8. one or more judgments or decrees shall be entered against any Group Member in an
aggregate outstanding amount (not covered by insurance) of $3,000,000 or more, and all such
judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal
within 30 days from the entry thereof; or




          8.1.9. any of the Security Documents shall cease, for any reason (other than as a result of
any act on the part of the Administrative Agent or any Lender), to be in full force and effect, or
any Loan Party or any Affiliate of any Loan Party shall so assert, or any Lien created by any of
the Security Documents shall cease (other than as a result of any act on the part of the
Administrative Agent or any Lender) to be enforceable and of the same effect and priority purported
to be created thereby with respect to any material Collateral; or




          8.1.10. the guarantee contained in Section 2 of the Guarantee and Collateral Agreement shall
cease, for any reason, to be in full force and effect or any Loan Party or any Affiliate of any
Loan Party shall so assert; or




          8.1.11. (i) Holdings shall fail to own, beneficially and of record, and control all of the
issued and outstanding Capital Stock of the Borrower or (ii) any Change of Control shall occur; or




          8.1.12. Holdings shall (i) conduct, transact or otherwise engage in, or commit to conduct,
transact or otherwise engage in, any business or operations other than those incidental to its
ownership of the Capital Stock of the Borrower, (ii) incur, create, assume or suffer to exist any
Indebtedness or other liabilities or financial obligations, except (w) liabilities with respect to
intercompany advances permitted by Section 7.2.6(i) and under the Tax Sharing Agreement, (x)
nonconsensual obligations imposed by operation of law, (y) pursuant to the Loan Documents to which
it is a party and (z) obligations with respect to its Capital Stock, or (iii) own, lease, manage or
otherwise operate any properties or assets (including cash (other than cash received by Holdings in
connection with dividends made by the Borrower in accordance with Section 7.2.6 pending application
in the manner contemplated by said Section) and Cash Equivalents) other than the ownership of
shares of Capital Stock of the Borrower.




     8.2 Consequences of Event of Default.



          8.2.1 Events of Default Other Than Bankruptcy, Insolvency or Reorganization
Proceedings. If an Event of Default specified under Sections 8.1.1 through 8.1.5, clauses (iii) and (iv)
of Section 8.1.6 or Sections 8.1.7 through 8.1.13 or clauses (i) and (ii) of Section 8.1.6 (with
respect to any Group Member that is not a Loan Party) shall occur and be continuing, the Lenders
and the Administrative Agent shall be under no further obligation to make Loans and the Issuing
Lender shall be under no obligation to issue Letters of Credit and the Administrative






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Agent may, and upon the request of the Required Lenders, shall (i) by written notice to the
Borrower, declare the unpaid principal amount of the Notes then outstanding and all interest
accrued thereon, any unpaid fees and all other Indebtedness of the Borrower to the Lenders
hereunder and thereunder to be forthwith due and payable, and the same shall thereupon become and
be immediately due and payable to the Administrative Agent for the benefit of each Lender without
presentment, demand, protest or any other notice of any kind, all of which are hereby expressly
waived, and (ii) require the Borrower to, and the Borrower shall thereupon, deposit in a
non-interest-bearing account with the Administrative Agent, as cash collateral for its Obligations
under the Loan Documents, an amount equal to the maximum amount currently or at any time thereafter
available to be drawn on all outstanding Letters of Credit, and the Borrower hereby pledges to the
Administrative Agent and the Lenders, and grants to the Administrative Agent and the Lenders a
security interest in, all such cash as security for such Obligations; and




          8.2.2 Bankruptcy, Insolvency or Reorganization Proceedings. If an Event of Default specified under clauses (i) and (ii) of Section 8.1.6 shall occur
with respect to any Loan Party, the Lenders shall be under no further obligations to make Loans
hereunder and the Issuing Lender shall be under no obligation to issue Letters of Credit and the
unpaid principal amount of the Loans then outstanding and all interest accrued thereon, any unpaid
fees and all other Obligations shall be immediately due and payable, without presentment, demand,
protest or notice of any kind, all of which are hereby expressly waived; and




          8.2.3 Set-off. If an Event of Default shall have occurred and be continuing, each Lender, the Issuing
Lender, and each of their respective Affiliates and any participant of such Lender or Affiliate
which has agreed in writing to be bound by the provisions of Section 4.3 is hereby authorized at
any time and from time to time, to the fullest extent permitted by applicable Law, to set off and
apply any and all deposits (general or special, time or demand, provisional or final, in whatever
currency) at any time held and other obligations (in whatever currency) at any time owing by such
Lender, the Issuing Lender or any such Affiliate or participant to or for the credit or the account
of any Loan Party against any and all of the Obligations of such Loan Party now or hereafter
existing under this Agreement or any other Loan Document to such Lender, the Issuing Lender,
Affiliate or participant, irrespective of whether or not such Lender, Issuing Lender, Affiliate or
participant shall have made any demand under this Agreement or any other Loan Document and although
such Obligations of the Borrower or such Loan Party may be contingent or unmatured or are owed to a
branch or office of such Lender or the Issuing Lender different from the branch or office holding
such deposit or obligated on such Indebtedness. The rights of each Lender, the Issuing Lender and
their respective Affiliates and participants under this Section are in addition to other rights and
remedies (including other rights of setoff) that such Lender, the Issuing Lender or their
respective Affiliates and participants may have. Each Lender and the Issuing Lender agrees to
notify the Borrower and the Administrative Agent promptly after any such setoff and application;
provided that the failure to give such notice shall not affect the validity of such setoff and
application; and




          8.2.4 Application of Proceeds. From and after the date on which the Administrative Agent has taken any action pursuant to
this Section 8.2 and until all Obligations of the Loan Parties have been Paid in Full, any and all
proceeds received by the Administrative Agent from any sale or other disposition of the Collateral,
or any part thereof, or the exercise of any other remedy by the Administrative Agent, shall be
applied as follows:





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          (i) first, to reimburse the Administrative Agent for out-of-pocket costs, expenses and
disbursements, including reasonable attorneys’ and paralegals’ fees and legal expenses, incurred by
the Administrative Agent in connection with realizing on the Collateral or collection of any
Obligations of any of the Loan Parties under any of the Loan Documents, including advances made by
the Administrative Agent for the reasonable maintenance, preservation, protection or enforcement
of, or realization upon, the Collateral, including advances for taxes, insurance, repairs and the
like and reasonable expenses incurred to sell or otherwise realize on, or prepare for sale or other
realization on, any of the Collateral;




          (ii) second, to the repayment of all Obligations then due and unpaid of the Loan Parties to
the Lenders or their Affiliates incurred under this Agreement or any of the other Loan Documents or
agreements evidencing any Lender Provided Hedge Agreements or Other Lender Provided Financial
Services Obligations, whether of principal, interest, fees, expenses or otherwise and to cash
collateralize the Letter of Credit Obligations, in such manner as the Administrative Agent may
determine in its discretion; and




          (iii) the balance, if any, as required by Law.




     8.3 Right to Cure. Notwithstanding anything to the contrary contained in Section 8.1, for
purposes of determining whether an Event of Default has occurred under the financial covenants set
forth in Sections 7.2.1(i) and (ii) (the “Financial Covenants”) at the end of any fiscal quarter,
Holdings may issue Permitted Cure Securities for cash or otherwise receive cash contributions and
contribute the proceeds thereof to the Borrower (as cash contributions to the capital of the
Borrower or in exchange for additional common Capital Stock) after the end of any fiscal quarter
and on or prior to the day that is ten (10) days after the day on which financial statements are
required to be delivered for such fiscal quarter pursuant to Section 7.1.1(i) or 7.1.1(ii), as the
case may be, will, at the written request of the Borrower to the Administrative Agent, be included
as an addition to Consolidated EBITDA for such fiscal quarter solely for the purposes of
determining compliance with the Financial Covenants at the end of such fiscal quarter and any
subsequent periods that include such fiscal quarter (any such cash amounts so included in the
calculation of Consolidated EBITDA, a “Specified Capital Contribution”), provided that (i) in each
four consecutive fiscal quarter period, there shall be a period of at least two fiscal quarters in
respect of which no Specified Capital Contribution is made, (ii) there shall be no more than four
fiscal quarters during the term of this Agreement in respect of which a Specified Capital
Contribution shall be made, (iii) the amount of any Specified Capital Contribution shall be no
greater than the amount required to cause the Borrower to be in compliance with the Financial
Covenants and (iv) all Specified Capital Contributions and the use of proceeds therefrom shall be
disregarded for all other purposes under the Loan Documents (including for calculations relating to
pricing). If, after a Specified Contribution is made and the recalculation of the Financial
Covenants as specified above in connection therewith, the Borrower shall then be in compliance with
the Financial Covenants for the applicable fiscal quarter, then the Borrower shall be deemed to
have complied with the Financial Covenants as of the relevant date of determination with the same
effect as though there had been no failure to comply therewith at such date of determination, and
the applicable Potential Default or Event of Default under Section 8.1.3 that had occurred shall be
deemed cured.



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9. THE ADMINISTRATIVE AGENT




     9.1 Appointment and Authority. Each of the Lenders and the Issuing Lender hereby
irrevocably appoints PNC to act on its behalf as the Administrative Agent hereunder and under the
other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and
to exercise such powers as are delegated to the Administrative Agent by the terms hereof or
thereof, together with such actions and powers as are reasonably incidental thereto. The
provisions of this Section 9 are solely for the benefit of the Administrative Agent, the Lenders
and the Issuing Lender, and neither the Borrower nor any other Loan Party shall have rights as a
third party beneficiary of any of such provisions.



     9.2 Rights as a Lender. The Person serving as the Administrative Agent hereunder shall
have the same rights and powers in its capacity as a Lender as any other Lender and may exercise
the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall,
unless otherwise expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative Agent hereunder in its individual capacity. Such Person and its
Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other
advisory capacity for and generally engage in any kind of business with the Borrower or any
Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder
and without any duty to account therefor to the Lenders.



     9.3 Exculpatory Provisions. The Administrative Agent shall not have any duties or
obligations except those expressly set forth herein and in the other Loan Documents. Without
limiting the generality of the foregoing, the Administrative Agent:



          (i) shall not be subject to any fiduciary or other implied duties, regardless of whether a
Potential Default or Event of Default has occurred and is continuing;




          (ii) shall not have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan
Documents that the Administrative Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided
for herein or in the other Loan Documents); provided that the Administrative Agent shall
not be required to take any action that, in its opinion or the opinion of its counsel, may expose
the Administrative Agent to liability or that is contrary to any Loan Document or applicable Law;
and




          (iii) shall not, except as expressly set forth herein and in the other Loan Documents, have
any duty to disclose, and shall not be liable for the failure to disclose, any information relating
to the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving
as the Administrative Agent or any of its Affiliates in any capacity.




          The Administrative Agent shall not be liable for any action taken or not taken by it (i) with
the consent or at the request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 10.1 and 8.2) in the absence of its own
gross negligence or willful misconduct. The Administrative Agent shall






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be deemed not to have knowledge of any Potential Default or Event of Default unless and until
notice describing such Potential Default or Event of Default is given to the Administrative Agent
by the Borrower, a Lender or the Issuing Lender.




          The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire
into (a) any statement, warranty or representation made in or in connection with this Agreement or
any other Loan Document, (b) the contents of any certificate, report or other document delivered
hereunder or thereunder or in connection herewith or therewith, (c) the performance or observance
of any of the covenants, agreements or other terms or conditions set forth herein or therein or the
occurrence of any Potential Default or Event of Default, (d) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement,
instrument or document or (e) the satisfaction of any condition set forth in Section 6 or elsewhere
herein, other than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.




     9.4 Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely
upon, and shall not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing (including any electronic message,
Internet or intranet website posting or other distribution) believed by it to be genuine and to
have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed by it to have been
made by the proper Person, and shall not incur any liability for relying thereon. In determining
compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of
Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the Issuing Lender,
the Administrative Agent may presume that such condition is satisfactory to such Lender or the
Issuing Lender unless the Administrative Agent shall have received notice to the contrary from such
Lender or the Issuing Lender prior to the making of such Loan or the issuance of such Letter of
Credit. The Administrative Agent may consult with legal counsel (who may be counsel for the
Borrower), independent accountants and other experts selected by it, and shall not be liable for
any action taken or not taken by it in accordance with the advice of any such counsel, accountants
or experts.



     9.5 Delegation of Duties. The Administrative Agent may perform any and all of its duties
and exercise its rights and powers hereunder or under any other Loan Document by or through any one
or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all of its duties and exercise its rights and powers by or through
their respective Related Parties. The exculpatory provisions of this Section 9 shall apply to any
such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.



     9.6 Resignation of Administrative Agent. The Administrative Agent may at any time resign
upon at least thirty (30) days’ prior notice given to the Lenders, the Issuing Lender and the
Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the
right, with approval from the Borrower (so long as no Event of Default has occurred and is
continuing), to appoint a successor, such approval not to be unreasonably withheld or delayed. If



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no such successor shall have been so appointed by the Required Lenders and shall have accepted
such appointment within twenty (20) days after the retiring Administrative Agent gives notice of
its resignation, then the retiring Administrative Agent may on behalf of the Lenders and the
Issuing Lender, appoint a successor Administrative Agent; provided that if the Administrative Agent
shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment,
then, on the date of effectiveness of such resignation stated in such notice, (i) the retiring
Administrative Agent shall be discharged from its duties and obligations hereunder and under the
other Loan Documents (except that in the case of any collateral security held by the Administrative
Agent on behalf of the Lenders or the Issuing Lender under any of the Loan Documents, the retiring
Administrative Agent shall continue to hold such collateral security until such time as a successor
Administrative Agent is appointed) and (ii) all payments, communications and determinations
provided to be made by, to or through the Administrative Agent shall instead be made by or to each
Lender and the Issuing Lender directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this Section 9.6. Upon the acceptance of a
successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the retiring (or retired)
Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its
duties and obligations hereunder or under the other Loan Documents (if not already discharged
therefrom as provided above in this Section). The fees payable by the Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the retiring Administrative Agent’s resignation
hereunder and under the other Loan Documents, the provisions of this Section 9 and Section 10.3
shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and
their respective Related Parties in respect of any actions taken or omitted to be taken by any of
them while the retiring Administrative Agent was acting as Administrative Agent.




     If PNC resigns as Administrative Agent under this Section 9.6, PNC shall also resign as an
Issuing Lender. Upon the appointment of a successor Administrative Agent hereunder, such successor
shall (i) succeed to all of the rights, powers, privileges and duties of PNC as the retiring
Issuing Lender and Administrative Agent and PNC shall be discharged from all of its respective
duties and obligations as Issuing Lender and Administrative Agent under the Loan Documents, and
(ii) issue letters of credit in substitution for the Letters of Credit issued by PNC, if any,
outstanding at the time of such succession or make other arrangement satisfactory to PNC to
effectively assume the obligations of PNC with respect to such Letters of Credit.



     9.7
Non-Reliance on Administrative Agent and Other Lenders. Each Lender and the Issuing
Lender acknowledges that it has, independently and without reliance upon the Administrative Agent
or any other Lender or any of their Related Parties and based on such documents and information as
it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.
Each Lender and the Issuing Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Lender or any of their Related Parties and
based on such documents and information as it shall from time to time deem appropriate, continue to
make its own decisions in taking or not taking action under or based upon this Agreement, any other
Loan Document or any related agreement or any document furnished hereunder or thereunder.



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     9.8 No Other Duties, etc. Anything herein to the contrary notwithstanding, none of the
Lead Arranger listed on the cover page hereof shall have any powers, duties or responsibilities
under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as
the Administrative Agent, a Lender or the Issuing Lender hereunder.



     9.9 Administrative Agent’s Fee. The Borrower shall pay to the Administrative Agent a
nonrefundable fee (the “Administrative Agent’s Fee”) under the terms of a letter dated November 8,
2010 (the “Administrative Agent’s Letter”) between the Borrower and Administrative Agent, as
amended from time to time.



     9.10 Release Collateral and Guarantors and Authorization Therefor. The Lenders and Issuing
Lenders authorize the Administrative Agent to release (i) the Liens created by the Loan Documents
on any Collateral consisting of assets or equity interests sold or otherwise Disposed of in a sale
or other Disposition permitted under Section 7.2.4 or 7.2.5 or, subject to the requirements of
Section 10.1.3, with the consent of the Required Lenders in writing, and, upon the consummation of
any such sale or other Disposition (other than to a Loan Party or a Subsidiary thereof) and so long
as no Event of Default has occurred and is continuing at the time such sale or other Disposition is
consummated, such Liens shall be automatically released without further action of any party, (ii)
all Collateral and the Liens created by the Loan Documents thereon upon Payment in Full of the
Obligations and any of the “Obligations” as defined in the Guarantee and Collateral Agreement, upon
which occurrence all such Liens shall be automatically released without further action of any
party, and (iii) any Guarantor from its obligations under the Guaranty and Collateral Agreement if
the ownership interests in such Guarantor are sold or otherwise disposed of or transferred to
Persons other than Loan Parties or Subsidiaries of the Loan Parties in a transaction permitted
under Section 7.2.4 or 7.2.5. At the request and sole expense of the Borrower, the Administration
Agent shall deliver to Holdings, the Borrower or a Subsidiary thereof any Collateral so released
that is held by the Administrative Agent and execute and deliver to Holdings, the Borrower or such
Subsidiary such documents as it shall reasonably request to evidence such release or termination.



     9.11 No Reliance on Administrative Agent’s Customer Identification Program. Each Lender
acknowledges and agrees that neither such Lender, nor any of its Affiliates, participants or
assignees, may rely on the Administrative Agent to carry out such Lender’s, Affiliate’s,
participant’s or assignee’s customer identification program, or other obligations required or
imposed under or pursuant to the USA Patriot Act or the regulations thereunder, including the
regulations contained in 31 CFR 103.121 (as hereafter amended or replaced, the “CIP Regulations”),
or any other Anti-Terrorism Law, including any programs involving any of the following items
relating to or in connection with any of the Loan Parties, their Affiliates or their agents, the
Loan Documents or the transactions hereunder or contemplated hereby: (i) any identity verification
procedures, (ii) any recordkeeping, (iii) comparisons with government lists, (iv) customer notices
or (v) other procedures required under the CIP Regulations or such other Laws.



10. MISCELLANEOUS




     10.1 Modifications, Amendments or Waivers. With the written consent of the Required
Lenders, the Administrative Agent, acting on behalf of all the Lenders, and the



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Borrower, on behalf of the Loan Parties, may from time to time enter into written agreements
amending or changing any provision of this Agreement or any other Loan Document or the rights of
the Lenders or the Loan Parties hereunder or thereunder, or may grant written waivers or consents
hereunder or thereunder. Any such agreement, waiver or consent made with such written consent
shall be effective to bind all the Lenders and the Loan Parties; provided, that no such agreement,
waiver or consent may be made which will:




          10.1.1 Increase of Commitment. Increase the amount of the Revolving Credit Commitment of any
Lender hereunder without the consent of such Lender;




          10.1.2 Extension of Payment; Reduction of Principal Interest or Fees; Modification of Terms of
Payment. Whether or not any Loans are outstanding, extend the Expiration Date or the time for
payment of principal or interest of any Loan (excluding the due date of any mandatory prepayment of
a Loan), the Commitment Fee or any other fee payable to any Lender, or reduce the principal amount
of or the rate of interest borne by any Loan or reduce the Commitment Fee or any other fee payable
to any Lender, without the consent of each Lender directly affected thereby;




          10.1.3 Release of Collateral or Guarantor. Except in connection with sales of assets
permitted by Section 7.2.4 or 7.2.5 or upon Payment in Full of the Obligations, release all or
substantially all of the Collateral or any Guarantor from its Obligations under the Guaranty and
Collateral Agreement without the consent of all Lenders (other than Defaulting Lenders); or




          10.1.4 Miscellaneous. Amend Section 4.2, 4.3 or 9.3 or this Section 10.1, alter any
provision requiring all Lenders to authorize the taking of any action or reduce any percentage
specified in the definition of Required Lenders, in each case without the consent of all of the
Lenders (other than Defaulting Lenders);



provided that no agreement, waiver or consent which would modify the interests, rights or
obligations of the Administrative Agent or the Issuing Lender may be made without the written
consent of such Administrative Agent or Issuing Lender, as applicable, and provided,
further that, if in connection with any proposed waiver, amendment or modification referred to
in Sections 10.1.1 through 10.1.4 above, the consent of the Required Lenders is obtained but the
consent of one or more of such other Lenders whose consent is required is not obtained (each a
“Non-Consenting Lender”), then the Borrower shall have the right to replace any such Non-Consenting
Lender with one or more replacement Lenders pursuant to Section 4.6.2 .




     10.2 No Implied Waivers; Cumulative Remedies. No course of dealing and no delay or failure
of the Administrative Agent or any Lender in exercising any right, power, remedy or privilege under
this Agreement or any other Loan Document shall affect any other or future exercise thereof or
operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any further
exercise thereof or of any other right, power, remedy or privilege. The rights and remedies of the
Administrative Agent and the Lenders under this Agreement and any other Loan Documents are
cumulative and not exclusive of any rights or remedies which they would otherwise have.



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     10.3 Expenses; Indemnity; Damage Waiver.



          10.3.1 Costs and Expenses. The Borrower agrees (i) to pay or reimburse the Administrative
Agent for all its reasonable and documented out-of-pocket costs and expenses incurred in connection
with the development, preparation and execution of, and any amendment, supplement or modification
to, this Agreement and the other Loan Documents and any other documents prepared in connection
herewith or therewith, and the consummation and administration of the transactions contemplated
hereby and thereby, including the reasonable and documented fees and disbursements of counsel to
the Administrative Agent and filing and recording fees and expenses, with statements with respect
to the foregoing to be submitted to the Borrower prior to the Closing Date (in the case of amounts
to be paid on the Closing Date) and from time to time thereafter on a quarterly basis or such other
periodic basis as a the Administrative Agent shall reasonably deem appropriate but not including
any fees and disbursements of counsel to the Lenders (other than the Administrative Agent), (ii) to
pay or reimburse each Lender and the Administrative Agent for all its reasonable costs and expenses
incurred in connection with the enforcement or preservation of any rights under this Agreement, the
other Loan Documents and any such other documents, including the reasonable disbursements of
counsel to each Lender and of counsel to Administrative Agent, (iii) to pay, indemnify, and hold
each Lender and the Administrative Agent harmless from, any and all recording and filing fees and
any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and
other taxes, if any that may be payable or determined to be payable in connection with the
execution and delivery of, or consummation or administration of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or
in respect of (or any proposed amendment or supplement to or modification or waiver of), this
Agreement, the other Loan Documents and any such other documents, (iv) to pay all out-of-pocket
expenses incurred by the Issuing Lender in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder, and (v) all reasonable
out-of-pocket expenses incurred by the Administrative Agent (including the reasonable fees, charges
and disbursements of any counsel for the Administrative Agent), in connection with any workout,
restructuring or negotiations in respect of the Loans or Letters of Credit or other Obligations.




          10.3.2 Indemnification by the Borrower. The Borrower shall indemnify the Administrative
Agent (and any sub-agent thereof), each Lender and the Issuing Lender, and each Related Party of
any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses
(including the fees, charges and disbursements of any counsel for any Indemnitee), and shall
indemnify and hold harmless each Indemnitee from all fees and time charges and disbursements for
attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against
any Indemnitee by any third party or by the Borrower or any other Loan Party arising out of, in
connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the performance or
nonperformance by the parties hereto of their respective obligations hereunder or thereunder or the
consummation of the transactions contemplated hereby or thereby, (ii) any Loan or Letter of Credit
or the use or proposed use of the proceeds therefrom (including any refusal by the Issuing Lender
to honor a demand for payment under a Letter of Credit if the documents presented in connection
with such demand do not strictly






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comply with the terms of such Letter of Credit), (iii) breach of representations, warranties
or covenants of the Borrower under the Loan Documents, or (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing, including any such items
or losses relating to or arising under Environmental Laws or pertaining to environmental matters,
whether based on contract, tort or any other theory, whether brought by a third party or by the
Borrower or any other Loan Party, and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee or (y) result from a claim brought by the
Borrower or any other Loan Party against an Indemnitee for breach in bad faith of such Indemnitee’s
obligations hereunder or under any other Loan Document, if the Borrower or such Loan Party has
obtained a final and nonappealable judgment in its favor on such claim as determined by a court of
competent jurisdiction.




          10.3.3 Reimbursement by Lenders. To the extent that the Borrower for any reason fails to
indefeasibly pay any amount required under Sections 10.3.1 or 10.3.2 to be paid by it to the
Administrative Agent (or any sub-agent thereof), the Issuing Lender or any Related Party of any of
the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such
sub-agent), the Issuing Lender or such Related Party, as the case may be, such Lender’s Ratable
Share (determined as of the time that the applicable unreimbursed expense or indemnity payment is
sought) of such unpaid amount, provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent (or any such sub-agent) or the Issuing Lender in its capacity as
such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or
any such sub-agent) or Issuing Lender in connection with such capacity.




          10.3.4 Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable
Law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other
Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated
hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof. No Indemnitee
referred to in Section 10.3.2 shall be liable for any damages arising from the use by unintended
recipients of any information or other materials distributed by it through telecommunications,
electronic or other information transmission systems in connection with this Agreement or the other
Loan Documents or the transactions contemplated hereby or thereby.




          10.3.5 Payments. All amounts due under this Section shall be payable not later than ten (10)
days after demand therefor.




     10.4 Holidays. Whenever payment of a Loan to be made or taken hereunder shall be due on a
day which is not a Business Day such payment shall be due on the next Business Day (except as
provided in Section 3.2) and such extension of time shall be included in computing interest and
fees, except that the Loans shall be due on the Business Day preceding the



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Expiration Date if the Expiration Date is not a Business Day. Whenever any payment or action
to be made or taken hereunder (other than payment of the Loans) shall be stated to be due on a day
which is not a Business Day, such payment or action shall be made or taken on the next following
Business Day, and such extension of time shall not be included in computing interest or fees, if
any, in connection with such payment or action.




     10.5 Notices; Effectiveness; Electronic Communication.



          10.5.1 Notices Generally. Except in the case of notices and other communications expressly
permitted to be given by telephone (and except as provided in Section 10.5.2 ), all notices and
other communications provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail or sent by telecopier (i) if to a
Lender, to it at its address set forth in its administrative questionnaire, or (ii) if to any other
Person, to it at its address set forth on Schedule 1.1(B).




          Notices sent by hand or overnight courier service, or mailed by certified or registered mail,
shall be deemed to have been given when received; notices sent by telecopier shall be deemed to
have been given when sent (except that, if not given during normal business hours for the
recipient, shall be deemed to have been given at the opening of business on the next Business Day
for the recipient). Notices delivered through electronic communications to the extent provided in
Section 10.5.2 , shall be effective as provided in such Section.




          10.5.2 Electronic Communications. Notices and other communications to the Lenders and the
Issuing Lender hereunder may be delivered or furnished by electronic communication (including
e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative
Agent; provided that the foregoing shall not apply to notices to any Lender or the Issuing
Lender if such Lender or the Issuing Lender, as applicable, has notified the Administrative Agent
that it is incapable of receiving notices under such Article by electronic communication. The
Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to procedures approved by it;
provided that approval of such procedures may be limited to particular notices or
communications. Unless the Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an
acknowledgement from the intended recipient (such as by the “return receipt requested” function, as
available, return e-mail or other written acknowledgement); provided that if such notice or
other communication is not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on the next Business Day
for the recipient, and (ii) notices or communications posted to an Internet or intranet website
shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as
described in the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.




          10.5.3 Change of Address, Etc. Any party hereto may change its address, e-mail address or
telecopier number for notices and other communications hereunder by notice to the other parties
hereto.




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     10.6 Severability. The provisions of this Agreement are intended to be severable. If any
provision of this Agreement shall be held invalid or unenforceable in whole or in part in any
jurisdiction, such provision shall, as to such jurisdiction, be ineffective to the extent of such
invalidity or unenforceability without in any manner affecting the validity or enforceability
thereof in any other jurisdiction or the remaining provisions hereof in any jurisdiction.



     10.7 Duration; Survival. All representations and warranties of the Loan Parties contained
herein or made in connection herewith shall survive the execution and delivery of this Agreement,
the completion of the transactions hereunder and Payment In Full. All covenants and agreements of
the Borrower contained herein relating to the payment of principal, interest, premiums, additional
compensation or expenses and indemnification, including those set forth in the Notes, Section 4 and
Section 10.3, shall survive Payment In Full. All other covenants and agreements of the Loan
Parties shall continue in full force and effect from and after the date hereof and until Payment In
Full.



     10.8 Successors and Assigns.



          10.8.1 Successors and Assigns Generally. The provisions of this Agreement shall be binding
upon, and inure to the benefit of, the parties hereto and their respective successors and assigns
permitted hereby, except that neither the Borrower nor any other Loan Party may assign or otherwise
transfer any of its rights or obligations hereunder without the prior written consent of the
Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an assignee in accordance with the provisions of
Section 10.8.2 , (ii) by way of participation in accordance with the provisions of Section 10.8.4 ,
or (iii) by way of pledge or assignment of a security interest subject to the restrictions of
Section 10.8.6 (and any other attempted assignment or transfer by any party hereto shall be null
and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in Section 10.8.4 and, to the extent expressly contemplated
hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.




          10.8.2 Assignments by Lenders. Any Lender may at any time assign to one or more assignees
all or a portion of its rights and obligations under this Agreement (including all or a portion of
its Commitment and the Loans at the time owing to it); provided that any such assignment
shall be subject to the following conditions:




          (i) Minimum Amounts.




               (A) in the case of an assignment of the entire remaining amount of the assigning Lender’s
Commitment and the Loans at the time owing to it or in the case of an assignment to a Lender, an
Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and



               (B) in any case not described in clause (i)(A) of this Section 10.8.2 , the aggregate amount
of the Commitment (which for this purpose includes Loans outstanding



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thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding
balance of the Loans of the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Assumption Agreement with respect to such assignment is delivered to the
Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption Agreement,
as of the Trade Date) shall not be less than $5,000,000, unless each of the Administrative Agent
and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents
(each such consent not to be unreasonably withheld or delayed).




          (ii) Proportionate Amounts. Each partial assignment shall be made as an assignment of
a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with
respect to the Loan or the Commitment assigned.




          (iii) Required Consents. No consent shall be required for any assignment except for
the consent of the Administrative Agent and the Issuing Lender (which consents shall not be
unreasonably withheld or delayed) and the consent of the Borrower (such consent of the Borrower not
to be unreasonably withheld or delayed), provided, that, the consent of the Borrower shall not be
required if (x) an Event of Default has occurred and is continuing at the time of such assignment
or (y) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided,
further, that the Borrower shall be deemed to have consented to any such assignment unless it shall
object thereto by written notice to the Administrative Agent within five (5) Business Days after
having received notice thereof.




          (iv) Assignment and Assumption Agreement. The parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Assumption Agreement, together
with a processing and recordation fee of $3,500, and the assignee, if it is not a Lender, shall
deliver to the Administrative Agent an administrative questionnaire provided by the Administrative
Agent.




          (v) No Assignment to Borrower. No such assignment shall be made to the Borrower or
any of the Borrower’s Affiliates or Subsidiaries.




          (vi) No Assignment to Natural Persons. No such assignment shall be made to a natural
person.



Subject to acceptance and recording thereof by the Administrative Agent pursuant to Section 10.8.3, from and after the effective date specified in each Assignment and Assumption Agreement, the
assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption Agreement, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption Agreement, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption Agreement covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but
shall continue to be entitled to the benefits of Sections 3.4, 4.7, and 10.3 with respect to facts
and circumstances occurring prior to the effective date of such assignment; provided, that no
assignee (including an assignee that is already a Lender hereunder at the time of the assignment)
shall be entitled to receive any greater amount pursuant to Section 4.8 than that to which the
assignor would have been entitled to receive had






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no such assignment occurred. Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this Section 10.8.2 shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and obligations in accordance
with Section 10.8.4 .




          10.8.3 Register. The Administrative Agent, shall maintain a record of the names and
addresses of the Lenders, and the Commitments of, and principal amounts of the Loans owing to, each
Lender pursuant to the terms hereof from time to time. Such register shall be conclusive, and the
Borrower, the Administrative Agent and the Lenders may treat each Person whose name is in such
register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. Any assignment of any Loan, whether or not evidenced by a
note, shall be effective for purposes of this Agreement only upon appropriate entries with respect
thereto being made in the register (and each Note shall expressly so provide). Such register shall
be available for inspection by the Borrower and any Lender, at any reasonable time and from time to
time upon reasonable prior notice.




          10.8.4 Participations. Any Lender may at any time, without the consent of, or notice to, the
Borrower or the Administrative Agent, sell participations to any Person (other than a natural
person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all
or a portion of its Commitment and/or the Loans owing to it); provided that (i) such
Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such obligations and (iii)
the Borrower, the Administrative Agent and the Lenders, Issuing Lender shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights and obligations under
this Agreement.




          Any agreement or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver with respect to Sections 10.1.1 ,
10.1.2 , or 10.1.3 ). Subject to Section 10.8.5 , the Borrower agrees that each Participant shall
be entitled to the benefits of Sections 3.4 and 4.7 to the same extent as if it were a Lender and
had acquired its interest by assignment pursuant to Section 10.8.2 . To the extent permitted by
Law, each Participant also shall be entitled to the benefits of Section 8.2.3 as though it were a
Lender; provided such Participant agrees to be subject to Section 4.3 as though it were a
Lender.




          10.8.5 Limitations upon Participant Rights Successors and Assigns Generally. A Participant
shall not be entitled to receive any greater payment under Sections 4.7, 4.8 or 10.3 than the
applicable Lender would have been entitled to receive with respect to the participation sold to
such Participant, unless the sale of the participation to such Participant is made with the
Borrower’s prior written consent. A Participant that would be a Foreign Lender if it were a Lender
shall not be entitled to the benefits of Section 4.8 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 4.8.5 as though it were a Lender.





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          10.8.6 Certain Pledges; Successors and Assigns Generally. Any Lender may at any time pledge
or assign a security interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure obligations to a Federal
Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.




     10.9 Confidentiality.



          10.9.1 General. Each of the Administrative Agent, the Lenders and the Issuing Lender agrees
to maintain the confidentiality of the Information, except that Information may be disclosed (i) to
its Affiliates and to its and its Affiliates’ respective partners, directors, officers, employees,
agents, advisors and other representatives (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such Information and instructed
to keep such Information confidential), (ii) to the extent requested by any regulatory authority
purporting to have jurisdiction over it (including any self-regulatory authority, such as the
National Association of Insurance Commissioners), (iii) to the extent required by applicable Laws
or regulations or by any subpoena or similar legal process, (iv) to any other party hereto, (v) in
connection with the exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder, (vi) subject to an agreement containing provisions substantially
the same as those of this Section, to (A) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this Agreement or (B) any
actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating
to the Borrower and its obligations, (vii) with the consent of the Borrower or (viii) to the extent
such Information (Y) becomes publicly available other than as a result of a breach of this Section
or (Z) becomes available to the Administrative Agent, any Lender, the Issuing Lender or any of
their respective Affiliates on a nonconfidential basis from a source other than the Borrower or the
other Loan Parties. Any Person required to maintain the confidentiality of Information as provided
in this Section shall be considered to have complied with its obligation to do so if such Person
has exercised the same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.




          10.9.2 Sharing Information With Affiliates of the Lenders. Each Loan Party acknowledges that
from time to time financial advisory, investment banking and other services may be offered or
provided to the Borrower or one or more of its Affiliates (in connection with this Agreement or
otherwise) by any Lender or by one or more Subsidiaries or Affiliates of such Lender and each of
the Loan Parties hereby authorizes each Lender to share any information delivered to such Lender by
such Loan Party and its Subsidiaries pursuant to this Agreement to any such Subsidiary or Affiliate
subject to the provisions of Section 10.9.1.




     10.10 Counterparts; Integration; Effectiveness.



          10.10.1 Counterparts; Integration; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a single






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contract. This Agreement and the other Loan Documents, and any separate letter agreements
with respect to fees payable to the Administrative Agent, constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof including any prior
confidentiality agreements and commitments. Except as provided in Section 6, this Agreement shall
become effective when it shall have been executed by the Administrative Agent and when the
Administrative Agent shall have received counterparts hereof that, when taken together, bear the
signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature
page of this Agreement by telecopy or e-mail shall be effective as delivery of a manually executed
counterpart of this Agreement.




     10.11 CHOICE OF LAW; SUBMISSION TO JURISDICTION; WAIVER OF VENUE; SERVICE OF PROCESS; WAIVER OF
JURY TRIAL.



          10.11.1 Governing Law. This Agreement shall be deemed to be a contract under the Laws of the
State of New York without regard to its conflict of laws principles. Each standby Letter of Credit
issued under this Agreement shall be subject either to the rules of the Uniform Customs and
Practice for Documentary Credits, as most recently published by the International Chamber of
Commerce (the “ICC”) at the time of issuance (“UCP”) or the rules of the International Standby
Practices (ICC Publication Number 590) (“ISP98”), as determined by the Issuing Lender, and each
trade Letter of Credit shall be subject to UCP, and in each case to the extent not inconsistent
therewith, the Laws of the State of New York without regard to is conflict of laws principles.




          10.11.2 SUBMISSION TO JURISDICTION. THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK SITTING IN MANHATTAN COUNTY AND OF THE UNITED STATES DISTRICT COURT
OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR
RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN
SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT
SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING LENDER MAY
OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.




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          10.11.3 WAIVER OF VENUE. THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN THIS SECTION
10.11. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT AND AGREES NOT ASSERT ANY SUCH DEFENSE.




          10.11.4 SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN
THE MANNER PROVIDED FOR NOTICES IN SECTION 10.5 . NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT
OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.




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




     10.12 USA Patriot Act Notice. Each Lender that is subject to the USA Patriot Act and the
Administrative Agent (for itself and not on behalf of any Lender) hereby notifies Loan Parties that
pursuant to the requirements of the USA Patriot Act, it is required to obtain, verify and record
information that identifies the Loan Parties, which information includes the name and address of
Loan Parties and other information that will allow such Lender or Administrative Agent, as
applicable, to identify the Loan Parties in accordance with the USA Patriot Act.









- 92 - 









 








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




	 	 	 	 	 	 	 

	 	 	MAFCO WORLDWIDE CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 

	 	 







 









 





	 	 	 	 	 	 	 

	 	 	PNC BANK, NATIONAL ASSOCIATION, as a
 Lender, Issuing
Lender and Administrative Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 

	 	 






 









 





	 	 	 	 	 	 	 

	 	 	UNION BANK, N.A., as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 

	 	 







 









 





SCHEDULE 1.1(A)




PRICING GRID—

VARIABLE PRICING AND FEES BASED ON LEVERAGE RATIO



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Consolidated	 	Commitment	 	Letter of	 	Revolving Credit	 	Revolving Credit 
LIBOR Rate 
	Level	 	Leverage Ratio	 	Fee	 	Credit Fee	 	Base Rate Spread	 	Spread
	
I	 	Less than 1.50 to 1.0
	 	 	0.125	%	 	 	1.50	%	 	 	0.50	%	 	 	1.50	%
	II	 	Greater than or equal to 1.50 to
1.0 but 

less than 2.0 to 1.0
	 	 	0.140	%	 	 	1.75	%	 	 	0.75	%	 	 	1.75	%
	III	 	Greater than or equal to 2.0 to 1.0
	 	 	0.155	%	 	 	2.0	%	 	 	1.00	%	 	 	2.0	%






     For purposes of determining the Applicable Margin, the Applicable Commitment Fee Rate and
the Applicable Letter of Credit Fee Rate:



     (a) Until three (3) Business Days after the delivery of the Compliance Certificate for the
fiscal year ending December 31, 2010, the Applicable Margin, the Applicable Commitment Fee Rate and
the Applicable Letter of Credit Fee Rate shall be set at Level I.



     (b) The Applicable Margin, the Applicable Commitment Fee Rate and the Applicable Letter of
Credit Fee Rate shall be recomputed as of the end of each fiscal quarter ending after the Closing
Date based on the Consolidated Leverage Ratio as of such quarter end. Any increase or decrease in
the Applicable Margin, the Applicable Commitment Fee Rate or the Applicable Letter of Credit Fee
Rate computed as of a quarter end shall be effective three (3) Business Days after the date that
the Compliance Certificate evidencing such computation is delivered under Section 7.1.2(ii). If a
Compliance Certificate is not delivered when due in accordance with such Section 7.1.2(ii) and the
Administrative Agent or the Required Lenders so elect,, then the rates in Level III shall apply as
of the first Business Day after the date on which such Compliance Certificate was required to have
been delivered and shall remain in effect until three (3) Business Days after the date that such
Compliance Certificate is delivered.



     (c) If, as a result of any restatement of or other adjustment to the financial statements of
the Borrower or for any other reason, the Borrower or the Lenders determine that (i) the
Consolidated Leverage Ratio as calculated by the Borrower as of any applicable date was



SCHEDULE 1.1(A) - 1 









 




inaccurate and (ii) a proper calculation of the Consolidated Leverage Ratio would have
resulted in higher pricing for such period, the Borrower shall immediately and retroactively be
obligated to pay to the Administrative Agent for the account of the applicable Lenders, promptly on
demand by the Administrative Agent (or, after the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the United States,
automatically and without further action by the Administrative Agent, any Lender or the Issuing
Lender), an amount equal to the excess of the amount of interest and fees that should have been
paid for such period over the amount of interest and fees actually paid for such period. This
paragraph shall not limit the rights of the Administrative Agent, any Lender or the Issuing Lender,
as the case may be, under Section 2.8 or 3.3 or 8. The Borrower’s obligations under this paragraph
shall survive the termination of the Commitments and the repayment of all other Obligations
hereunder.









SCHEDULE 1.1(A) - 2 









 








SCHEDULE 1.1(B)




COMMITMENTS OF LENDERS AND ADDRESSES FOR NOTICES



Page 1 of 2


Part 1 — Commitments of Lenders and Addresses for Notices to Lenders




	 	 	 	 	 	 	 	 	 
	 	 	Amount of	 	 
	 	 	Commitment for	 	 
	 	 	Revolving Credit	 	 
	Lender	 	Loans	 	Ratable Share
	Name: PNC Bank, National Association

Address: 1950 East Route 70, 3rd Floor,

                Cherry Hill, New Jersey 08003

Attention: William Cornelius

Telephone: (856) 489-2713

Telecopy: (856) 489-2785
	 	$	25,000,000	 	 	 	56	%
	 
	 	 	 	 	 	 	 	 
	Name: Union Bank, N.A.

Address: 445 S. Figueroa St., 16th Floor

                Los Angeles, CA 90071

Attention: Megan Webtser

Telephone: (213) 236-7517

Telecopy: (213) 236-7636
	 	$	20,000,000	 	 	 	44	%
	 
	 	 	 	 	 	 	 	 
	Total
	 	$	45,000,000	 	 	 	100	%











SCHEDULE 1.1(B) - 1 









 








SCHEDULE 1.1(B)




COMMITMENTS OF LENDERS AND ADDRESSES FOR NOTICES



Page 2 of 2



	 	 	 

	Part 2 — Addresses for Notices to the Borrower:
	 
	 	 
	ADMINISTRATIVE AGENT
	 
	 	 
	Name: PNC Bank, National Association
	Address: 1950 East Route 70, 3rd Floor
	Cherry Hill, New Jersey 08003
	Attention: William Cornelius
	Telephone:

	 	(856) 489-2713
	Telecopy:

	 	(856) 489-1847
	 
	 	 
	With a Copy To:
	 
	 	 
	Agency Services, PNC Bank, National Association
	Mail Stop: P7-PFSC-04-I
	Address: 500 First Avenue
	Pittsburgh, PA 15219
	Attention:

	 	Agency Services
	Telephone:

	 	412 762 6442
	Telecopy:

	 	412 762 8672
	 
	 	 
	BORROWER:
	 	 
	 
	 	 
	Name:

	 	Mafco Worldwide Corporation
	Address:

	 	300 Jefferson Avenue
	 

	 	Camden, New Jersey 08104
	Attention:

	 	Lynn Seeholzer, Treasurer
	Telephone

	 	(856) 968-4067
	Telecopy:

	 	(856) 225-1418