Ex-10.1 Credit Agreement



 




Exhibit
10.1



Published CUSIP Number: [                    ]

Revolving Credit CUSIP Number: [                    ]








 








$450,000,000




CREDIT AGREEMENT




dated as of December 21, 2007




by and among




CORRECTIONS CORPORATION OF AMERICA,

as Borrower,




the Lenders referred to herein,




BANK OF AMERICA, N.A.,

as Administrative Agent, Swingline Lender and Issuing Lender




and




BANC OF AMERICA SECURITIES LLC,

as Sole Book Manager




BANC OF AMERICA SECURITIES LLC and WACHOVIA CAPITAL MARKETS, LLC

as Joint Lead Arrangers




WACHOVIA BANK, NATIONAL ASSOCIATION,

as Syndication Agent




and




JPMORGAN CHASE BANK, N.A., HSBC BANK USA and SUNTRUST BANK

as Co-Documentation Agents




 








 









 












TABLE OF CONTENTS




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page
	ARTICLE I DEFINITIONS	 	 	1	 
	 
	 

	 	SECTION 1.1
	 	Definitions
	 	 	1	 
	 

	 	SECTION 1.2
	 	Other Definitions and Provisions
	 	 	29	 
	 

	 	SECTION 1.3
	 	Accounting Terms
	 	 	30	 
	 

	 	SECTION 1.4
	 	UCC Terms
	 	 	30	 
	 

	 	SECTION 1.5
	 	Rounding
	 	 	30	 
	 

	 	SECTION 1.6
	 	References to Agreement and Laws
	 	 	30	 
	 

	 	SECTION 1.7
	 	Times of Day
	 	 	30	 
	 

	 	SECTION 1.8
	 	Letter of Credit Amounts
	 	 	30	 
	 

	 	SECTION 1.9
	 	Consolidation of Variable Interest Entities
	 	 	31	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE II REVOLVING CREDIT FACILITY	 	 	31	 
	 
	 

	 	SECTION 2.1
	 	Revolving Credit Loans
	 	 	31	 
	 

	 	SECTION 2.2
	 	Swingline Loans
	 	 	31	 
	 

	 	SECTION 2.3
	 	Procedure for Advances of Revolving Credit Loans and Swingline Loans
	 	 	33	 
	 

	 	SECTION 2.4
	 	Repayment and Prepayment of Revolving Credit and Swingline Loans
	 	 	33	 
	 

	 	SECTION 2.5
	 	Permanent Reduction of the Revolving Credit Commitment
	 	 	34	 
	 

	 	SECTION 2.6
	 	Termination of Revolving Credit Facility
	 	 	35	 
	 

	 	SECTION 2.7
	 	Increase in Revolving Credit Facility
	 	 	35	 
	 

	 	SECTION 2.8
	 	Incremental Term Loans
	 	 	37	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE III LETTER OF CREDIT FACILITY	 	 	39	 
	 
	 

	 	SECTION 3.1
	 	L/C Commitment
	 	 	39	 
	 

	 	SECTION 3.2
	 	Procedure for Issuance of Letters of Credit
	 	 	40	 
	 

	 	SECTION 3.3
	 	Commissions and Other Charges
	 	 	40	 
	 

	 	SECTION 3.4
	 	L/C Participations
	 	 	41	 
	 

	 	SECTION 3.5
	 	Reimbursement Obligation of the Borrower
	 	 	42	 
	 

	 	SECTION 3.6
	 	Obligations Absolute
	 	 	43	 
	 

	 	SECTION 3.7
	 	Effect of Letter of Credit Application
	 	 	43	 
	 

	 	SECTION 3.8
	 	Appointment and Duties of Additional Issuing Lenders
	 	 	43	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE IV GENERAL LOAN PROVISIONS	 	 	44	 






-i-  








 






TABLE OF CONTENTS

(continued)




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page
	 

	 	SECTION 4.1
	 	Interest
	 	 	44	 
	 

	 	SECTION 4.2
	 	Notice and Manner of Conversion or Continuation of Loans
	 	 	45	 
	 

	 	SECTION 4.3
	 	Fees
	 	 	46	 
	 

	 	SECTION 4.4
	 	Manner of Payment
	 	 	46	 
	 

	 	SECTION 4.5
	 	Evidence of Indebtedness
	 	 	47	 
	 

	 	SECTION 4.6
	 	Adjustments
	 	 	47	 
	 

	 	SECTION 4.7
	 	Nature of Obligations of Lenders Regarding Extensions of Credit;
Assumption by the Administrative Agent
	 	 	48	 
	 

	 	SECTION 4.8
	 	Changed Circumstances
	 	 	49	 
	 

	 	SECTION 4.9
	 	Indemnity
	 	 	49	 
	 

	 	SECTION 4.10
	 	Increased Costs
	 	 	50	 
	 

	 	SECTION 4.11
	 	Taxes
	 	 	51	 
	 

	 	SECTION 4.12
	 	Mitigation Obligations; Replacement of Lenders
	 	 	53	 
	 

	 	SECTION 4.13
	 	Security
	 	 	54	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE V CONDITIONS OF CLOSING AND BORROWING	 	 	55	 
	 
	 

	 	SECTION 5.1
	 	Conditions to Closing and Initial Extensions of Credit
	 	 	55	 
	 

	 	SECTION 5.2
	 	Conditions to All Extensions of Credit
	 	 	58	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE VI REPRESENTATIONS AND WARRANTIES OF THE BORROWER	 	 	59	 
	 
	 

	 	SECTION 6.1
	 	Representations and Warranties
	 	 	59	 
	 

	 	SECTION 6.2
	 	Survival of Representations and Warranties, Etc
	 	 	66	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE VII FINANCIAL INFORMATION AND NOTICES	 	 	66	 
	 
	 

	 	SECTION 7.1
	 	Financial Statements and Projections
	 	 	66	 
	 

	 	SECTION 7.2
	 	Officer’s Compliance Certificate
	 	 	68	 
	 

	 	SECTION 7.3
	 	Accountants’ Certificate
	 	 	68	 
	 

	 	SECTION 7.4
	 	Other Reports
	 	 	68	 
	 

	 	SECTION 7.5
	 	Notice of Litigation and Other Matters
	 	 	68	 
	 

	 	SECTION 7.6
	 	Accuracy of Information
	 	 	69	 
	 

	 	SECTION 7.7
	 	Posting of Borrower Materials
	 	 	69	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE VIII AFFIRMATIVE COVENANTS	 	 	70	 
	 
	 

	 	SECTION 8.1
	 	Preservation of Corporate Existence and Related Matters
	 	 	70	 






-ii-  









 






TABLE OF CONTENTS

(continued)




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page
	 

	 	SECTION 8.2
	 	Maintenance of Property
	 	 	70	 
	 

	 	SECTION 8.3
	 	Insurance
	 	 	70	 
	 

	 	SECTION 8.4
	 	Accounting Methods and Financial Records
	 	 	70	 
	 

	 	SECTION 8.5
	 	Payment and Performance of Obligations
	 	 	71	 
	 

	 	SECTION 8.6
	 	Compliance With Laws and Approvals
	 	 	71	 
	 

	 	SECTION 8.7
	 	Environmental Laws
	 	 	71	 
	 

	 	SECTION 8.8
	 	Compliance with ERISA
	 	 	71	 
	 

	 	SECTION 8.9
	 	Compliance With Agreements
	 	 	72	 
	 

	 	SECTION 8.10
	 	Visits and Inspections
	 	 	72	 
	 

	 	SECTION 8.11
	 	Additional Subsidiaries
	 	 	72	 
	 

	 	SECTION 8.12
	 	Designation of Restricted and Unrestricted Subsidiaries
	 	 	73	 
	 

	 	SECTION 8.13
	 	Use of Proceeds
	 	 	74	 
	 

	 	SECTION 8.14
	 	Further Assurances
	 	 	74	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE IX FINANCIAL COVENANTS	 	 	74	 
	 
	 

	 	SECTION 9.1
	 	Consolidated Total Leverage Ratio
	 	 	74	 
	 

	 	SECTION 9.2
	 	Consolidated Secured Leverage Ratio
	 	 	75	 
	 

	 	SECTION 9.3
	 	Interest Coverage Ratio
	 	 	75	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE X NEGATIVE COVENANTS	 	 	75	 
	 
	 

	 	SECTION 10.1
	 	Limitations on Indebtedness
	 	 	75	 
	 

	 	SECTION 10.2
	 	Limitations on Liens
	 	 	77	 
	 

	 	SECTION 10.3
	 	Limitations on Mergers and Liquidation
	 	 	79	 
	 

	 	SECTION 10.4
	 	Limitations on Asset Dispositions
	 	 	79	 
	 

	 	SECTION 10.5
	 	Restricted Payments
	 	 	82	 
	 

	 	SECTION 10.6
	 	Limitations on Exchange and Issuance of Disqualified Stock
	 	 	86	 
	 

	 	SECTION 10.7
	 	Transactions with Affiliates
	 	 	86	 
	 

	 	SECTION 10.8
	 	Certain Accounting Changes; Organizational Documents
	 	 	87	 
	 

	 	SECTION 10.9
	 	Amendments; Payments and Prepayments of Material Indebtedness
	 	 	87	 
	 

	 	SECTION 10.10
	 	Restrictive Agreements
	 	 	87	 
	 

	 	SECTION 10.11
	 	Nature of Business
	 	 	88	 






-iii-  









 






TABLE OF CONTENTS

(continued)




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page
	 

	 	SECTION 10.12
	 	Impairment of Security Interests
	 	 	88	 
	 

	 	SECTION 10.13
	 	Use of Proceeds
	 	 	88	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE XI DEFAULT AND REMEDIES	 	 	88	 
	 
	 

	 	SECTION 11.1
	 	Events of Default
	 	 	88	 
	 

	 	SECTION 11.2
	 	Remedies
	 	 	90	 
	 

	 	SECTION 11.3
	 	Rights and Remedies Cumulative; Non-Waiver; etc
	 	 	91	 
	 

	 	SECTION 11.4
	 	Crediting of Payments and Proceeds
	 	 	91	 
	 

	 	SECTION 11.5
	 	Administrative Agent May File Proofs of Claim
	 	 	92	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE XII THE ADMINISTRATIVE AGENT	 	 	93	 
	 
	 

	 	SECTION 12.1
	 	Appointment and Authority
	 	 	93	 
	 

	 	SECTION 12.2
	 	Rights as a Lender
	 	 	93	 
	 

	 	SECTION 12.3
	 	Exculpatory Provisions
	 	 	93	 
	 

	 	SECTION 12.4
	 	Reliance by the Administrative Agent
	 	 	94	 
	 

	 	SECTION 12.5
	 	Delegation of Duties
	 	 	94	 
	 

	 	SECTION 12.6
	 	Resignation of Administrative Agent
	 	 	95	 
	 

	 	SECTION 12.7
	 	Non-Reliance on Administrative Agent and Other Lenders
	 	 	96	 
	 

	 	SECTION 12.8
	 	No Other Duties, etc
	 	 	96	 
	 

	 	SECTION 12.9
	 	Collateral and Guaranty Matters
	 	 	96	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE XIII MISCELLANEOUS	 	 	97	 
	 
	 

	 	SECTION 13.1
	 	Notices
	 	 	97	 
	 

	 	SECTION 13.2
	 	Amendments, Waivers and Consents
	 	 	98	 
	 

	 	SECTION 13.3
	 	Expenses; Indemnity
	 	 	100	 
	 

	 	SECTION 13.4
	 	Right of Set-off
	 	 	102	 
	 

	 	SECTION 13.5
	 	Governing Law
	 	 	102	 
	 

	 	SECTION 13.6
	 	Waiver of Jury Trial
	 	 	103	 
	 

	 	SECTION 13.7
	 	Reversal of Payments
	 	 	103	 
	 

	 	SECTION 13.8
	 	Injunctive Relief; Punitive Damages
	 	 	103	 
	 

	 	SECTION 13.9
	 	Accounting Matters
	 	 	104	 
	 

	 	SECTION 13.10
	 	Successors and Assigns; Participations
	 	 	104	 
	 

	 	SECTION 13.11
	 	Confidentiality
	 	 	108	 






-iv-  









 






TABLE OF CONTENTS

(continued)




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page
	 

	 	SECTION 13.12
	 	Performance of Duties
	 	 	109	 
	 

	 	SECTION 13.13
	 	All Powers Coupled with Interest
	 	 	109	 
	 

	 	SECTION 13.14
	 	Survival of Indemnities
	 	 	109	 
	 

	 	SECTION 13.15
	 	Titles and Captions
	 	 	109	 
	 

	 	SECTION 13.16
	 	Severability of Provisions
	 	 	109	 
	 

	 	SECTION 13.17
	 	Counterparts
	 	 	109	 
	 

	 	SECTION 13.18
	 	Integration
	 	 	109	 
	 

	 	SECTION 13.19
	 	Term of Agreement
	 	 	110	 
	 

	 	SECTION 13.20
	 	Advice of Counsel, No Strict Construction
	 	 	110	 
	 

	 	SECTION 13.21
	 	No Advisory or Fiduciary Responsibility
	 	 	110	 
	 

	 	SECTION 13.22
	 	USA Patriot Act
	 	 	111	 
	 

	 	SECTION 13.23
	 	Inconsistencies with Other Documents; Independent Effect of Covenants
	 	 	111	 






-v-  









 






	 	 	 	 	 
	EXHIBITS	 	 	 	 
	 
	 	 	 	 
	Exhibit A-1

	 	-
	 	Form of Revolving Credit Note
	Exhibit A-2

	 	-
	 	Form of Swingline Note
	Exhibit B

	 	-
	 	Form of Notice of Borrowing
	Exhibit C

	 	-
	 	Form of Notice of Account Designation
	Exhibit D

	 	-
	 	Form of Notice of Prepayment
	Exhibit E

	 	-
	 	Form of Notice of Conversion/Continuation
	Exhibit F

	 	-
	 	Form of Officer’s Compliance Certificate
	Exhibit G

	 	-
	 	Form of Assignment and Assumption
	Exhibit H

	 	-
	 	Form of Subsidiary Guaranty Agreement
	Exhibit I

	 	-
	 	Form of Collateral Agreement






	 	 	 	 	 
	SCHEDULES	 	 	 	 
	 
	 	 	 	 
	Schedule 1.1(a)     

	 	-
	 	Existing Letters of Credit
	Schedule 1.1(b)

	 	-
	 	Existing Loans, Advances and Investments
	Schedule 1.1(c)

	 	-
	 	Book Value of Designated Assets
	Schedule 6.1(a)

	 	-
	 	Jurisdictions of Organization and Qualification
	Schedule 6.1(b)

	 	-
	 	Subsidiaries and Capitalization
	Schedule 6.1(i)

	 	-
	 	ERISA Plans
	Schedule 6.1(1)

	 	-
	 	Material Indebtedness
	Schedule 6.1(m)

	 	-
	 	Labor and Collective Bargaining Agreements
	Schedule 6.1(u)

	 	-
	 	Litigation
	Schedule 10.2

	 	-
	 	Existing Liens
	Schedule 10.7

	 	-
	 	Transactions with Affiliates






vi  









 






     CREDIT AGREEMENT, dated as of December 21, 2007, by and among CORRECTIONS CORPORATION OF
AMERICA, a Maryland corporation (the “Borrower”), the lenders who are or may become a party
to this Agreement (collectively, the “Lenders”) and BANK OF AMERICA, N.A., a national
banking association, as Administrative Agent for the Lenders.



STATEMENT OF PURPOSE




     The Borrower has requested, and the Lenders have agreed, to extend certain credit facilities
to the Borrower on the terms and conditions of this Agreement.



     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by the parties hereto, such parties hereby agree as follows:



ARTICLE I




DEFINITIONS




     SECTION 1.1 Definitions. The following terms when used in this Agreement shall have
the meanings assigned to them below:



     “Additional Issuing Lenders” means up to two (2) Revolving Credit Lenders designated
by the Borrower as additional issuers of Letters of Credit pursuant to Section 3.8.



     “Administrative Agent” means Bank of America, in its capacity as Administrative Agent
hereunder, and any successor thereto appointed pursuant to Section 12.6.



     “Administrative Agent’s Office” means the office of the Administrative Agent specified
in or determined in accordance with the provisions of Section 13.1(c).



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



     “Affiliate” means, with respect to any Person, any other Person (other than a
Subsidiary of such Person) which directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such first Person or any of its
Subsidiaries. As used in this definition, the term “control” means (a) the power to vote ten
percent (10%) or more of the securities or other equity interests of a Person having ordinary
voting power, or (b) the possession, directly or indirectly, of any other power to direct or cause
the direction of the management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise.



     “Agecroft” means Agecroft Prison Management Limited, incorporated in England and
Wales.



     “Agecroft Note” means the Subordinated Loan Agreement among Agecroft, the Borrower and
Sodexho Alliance S.A., dated July 6, 1998, as amended, in the aggregate principal amount of
£6,309,000.



 









 





     “Agreement” means this Credit Agreement, as amended, restated, supplemented or
otherwise modified from time to time.



     “Applicable Law” means all applicable provisions of constitutions, laws, statutes,
ordinances, rules, treaties, regulations, permits, licenses, approvals, interpretations and orders
of courts or Governmental Authorities and all orders and decrees of all courts and arbitrators.



     “Applicable Margin” means the corresponding percentages per annum as set forth below
based on the Consolidated Total Leverage Ratio:



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Pricing	 	 	 	Commitment	 	 	 	 	 	Base
	Level	 	Consolidated Total Leverage Ratio	 	Fee	 	LIBOR Rate +	 	Rate +
	I

	 	Greater than or equal to 4.50 to 1.00
	 	 	0.300	%	 	 	1.500	%	 	 	0.500	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	II

	 	Greater than or equal to 4.00 to 1.00,
but less than 4.50 to 1.00
	 	 	0.250	%	 	 	1.250	%	 	 	0.250	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	III

	 	Greater than or equal to 3.50 to 1.00
but less than 4.00 to 1.00
	 	 	0.200	%	 	 	1.000	%	 	 	0.000	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	IV

	 	Less than 3.50 to 1.00
	 	 	0.150	%	 	 	0.750	%	 	 	0.000	%





The Applicable Margin shall be determined and adjusted quarterly on the date (each a
“Calculation Date”) ten (10) Business Days after receipt by the Administrative Agent of the
Officer’s Compliance Certificate pursuant to Section 7.2 for the most recently ended fiscal
quarter of the Borrower; provided that (a) the Applicable Margin shall be based on Pricing
Level IV until the first Calculation Date occurring after the Closing Date and, thereafter the
Pricing Level shall be determined by reference to the Consolidated Total Leverage Ratio as of the
last day of the most recently ended fiscal quarter of the Borrower preceding the applicable
Calculation Date, and (b) if the Borrower fails to provide the Officer’s Compliance Certificate as
required by Section 7.2 for the most recently ended fiscal quarter of the Borrower
preceding the applicable Calculation Date, the Applicable Margin from such Calculation Date shall
be based on Pricing Level I until such time as an appropriate Officer’s Compliance Certificate is
provided, at which time the Pricing Level shall be determined by reference to the Consolidated
Total Leverage Ratio as of the last day of the most recently ended fiscal quarter of the Borrower
preceding such Calculation Date. The Applicable Margin shall be effective from one Calculation
Date until the next Calculation Date. Any adjustment in the Applicable Margin shall be applicable
to all Extensions of Credit then existing or subsequently made or issued.




     “Approved Fund” means any Person (other than a natural Person), including, without
limitation, any special purpose entity, that is (or will be) engaged in making, purchasing, holding
or otherwise investing in commercial loans and similar extensions of credit in the ordinary course
of its business; provided, that such Approved Fund must be administered, managed or
underwritten 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.



     “Arrangers” means each of BAS and WCM, in their capacity as joint lead arrangers.



2









 





     “Asset Disposition” means the disposition of any or all of the assets (including,
without limitation, the Capital Stock of a Subsidiary or any ownership interest in a joint venture)
of any Credit Party or any Subsidiary thereof whether by sale, lease, transfer or otherwise. The
term “Asset Disposition” shall not include any Equity Issuance.



     “Asset Lien Value” means, with respect to a Lien on assets of the Borrower and its
Restricted Subsidiaries, the greater of (a) the fair market value of the asset(s) subject to such
Lien based on recent appraisals delivered to and reasonably acceptable to the Administrative Agent
and (b) the net book value of such asset(s), in each case determined at the time such Lien is
created.



     “Asset Swap” means an exchange of assets other than cash, Cash Equivalents or Capital
Stock of the Borrower or any Subsidiary by the Borrower or a Restricted Subsidiary of the Borrower
for (a) one or more Permitted Businesses, (b) a controlling equity interest in any Person whose
assets consist primarily of one or more Permitted Businesses and/or (c) one or more real estate
properties.



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



     “Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is required by
Section 13.10), and accepted by the Administrative Agent, in substantially the form of
Exhibit G or any other form approved by the Administrative Agent.



     “Attributable Indebtedness” means, on any date, (a) in respect of any Capital Lease of
any Person, the capitalized amount thereof that would appear as a liability on a balance sheet of
such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic
Lease, the capitalized amount or principal amount of the remaining lease payments under the
relevant lease that would appear as a liability on a balance sheet of such Person prepared as of
such date in accordance with GAAP if such lease were accounted for as a Capital Lease.



     “Auction Rate Securities” means any debt instruments with a long-term nominal maturity
for which the interest rate is reset through a “dutch auction” process with interest on such
Auction Rate Securities being paid at the end of each such auction period; provided, however, that
such Auction Rate Securities shall have, at the time of purchase, one of the two highest rating
categories obtainable from either Moody’s or S&P.



     “Audited Financial Statements” means the audited Consolidated balance sheet of the
Borrower and its Subsidiaries for the fiscal year ended December 31, 2006, and the related
Consolidated statements of income or operations, stockholders’ equity and cash flows for such
fiscal year of the Borrower and its Subsidiaries, including the notes thereto.



     “Bank of America” means Bank of America, N.A., a national banking association, and its
successors.



     “BAS” means Banc of America Securities LLC, and its successors.



3









 





     “Base Rate” means, at any time, the higher of (a) the Prime Rate and (b) the sum of
the Federal Funds Rate plus 1/2 of 1%; each change in the Base Rate shall take effect
simultaneously with the corresponding change or changes in the Prime Rate or the Federal Funds
Rate.



     “Base Rate Loan” means any Loan bearing interest at a rate based upon the Base Rate as
provided in Section 4.1(a).



     “Borrower” has the meaning assigned thereto in the introductory paragraph hereof



     “Borrower Materials” has the meaning assigned thereto in Section 7.7.



     “Business Day” means (a) for all purposes other than as set forth in clause (b) below,
any day (other than a Saturday, Sunday or legal holiday) on which banks in Chicago, Illinois and
New York, New York, are open for the conduct of their commercial banking business, and (b) with
respect to all notices and determinations in connection with, and payments of principal and
interest on, any LIBOR Rate Loan, any day that is a Business Day described in clause (a) and that
is also a day for trading by and between banks in Dollar deposits in the London interbank market.



     “Calculation Date” has the meaning assigned thereto in the definition of Applicable
Margin.



     “Capital Lease” means any lease of any property by the Borrower or any of its
Restricted Subsidiaries, as lessee, that should, in accordance with GAAP, be classified and
accounted for as a capital lease on a Consolidated balance sheet of the Borrower and its Restricted
Subsidiaries.



     “Capital Stock” (a) in the case of a corporation, capital stock, (b) in the case of an
association or business entity, any and all shares, interests, participations, rights or other
equivalents (however designated) of capital stock, (c) in the case of a partnership, partnership
interests (whether general or limited), (d) in the case of a limited liability company, membership
interests and (e) any other interest or participation that confers on a Person the right to receive
a share of the profits and losses of, or distributions of assets of, the issuing Person.



     “Cash Equivalent” means: (a) Dollars; (b) Government Securities having maturities of
not more than one year from the date of acquisition; (c) readily marketable direct obligations
issued by any state of the United States or any political subdivision thereof having one of the two
highest rating categories obtainable from either Moody’s or S&P with maturities of twelve months or
less from the date of acquisition; (d) Auction Rate Securities; (e) certificates of deposit and
eurodollar time deposits with maturities of six months or less from the date of acquisition,
bankers’ acceptances with maturities not exceeding one year and overnight bank deposits, in each
case, with any Lender party to this Agreement or with any domestic commercial bank having capital
and surplus in excess of $500,000,000 and a Thomson Bank Watch Rating of “B” or better; (f)
repurchase obligations with a term of not more than seven days for underlying securities of the
types described in clauses (b) and (c) above entered into with any financial institution meeting
the qualifications specified in clause (e) above; (g) commercial paper having the highest rating
obtainable from Moody’s or S&P and in each case maturing within one year after the date of
acquisition; and (h) money market funds at least 90%



4









 




of the assets of which constitute Cash Equivalents of the kinds described in clauses (a)
through (g) of this definition.




     “Change in Control” means an event or series of events by which (a) any person or
group of persons (within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as
amended), shall obtain ownership or control in one or more series of transactions of more than
thirty percent (30%) of the outstanding common stock or thirty percent (30%) of the voting power of
the Borrower entitled to vote in the election of members of the board of directors of the Borrower,
(b) there shall have occurred under any indenture, contract or agreement evidencing any Material
Indebtedness (including, without limitation, any Senior Unsecured Notes) any “change in control” or
similar event (as set forth in the indenture, agreement or other evidence of such Indebtedness)
obligating the Borrower to repurchase, redeem or repay all or any part of the Indebtedness or
Capital Stock provided for therein or (c) a majority of the members of the board of directors of
the Borrower cease to be Continuing Directors.



     “Change in Law” means the occurrence, after the date of this Agreement, of any of the
following, as applicable: (a) the adoption or taking effect of any law, rule, regulation or
treaty, (b) any change in any law, rule, regulation or treaty or in the administration,
interpretation or application thereof by any Governmental Authority or (c) the making or issuance
of any request, guideline or directive (whether or not having the force of law) by any Governmental
Authority.



     “Closing Date” means the date of this Agreement or such later Business Day upon which
each condition described in Section 5.1 shall be satisfied or waived in a manner acceptable
to the Administrative Agent, in its sole discretion.



     “Code” means the Internal Revenue Code of 1986, and the rules and regulations
thereunder, each as amended or modified from time to time.



     “Collateral” means the collateral security for the Obligations pledged or granted
pursuant to the Security Documents.



     “Collateral Agreement” means the collateral agreement of even date herewith executed
by the Credit Parties in favor of the Administrative Agent for the benefit of itself and the
Lenders, substantially in the form of Exhibit I, as amended, restated, supplemented or otherwise
modified from time to time.



     “Consolidated” means, when used with reference to financial statements or financial
statement items of any Person, such statements or items on a consolidated basis in accordance with
applicable principles of consolidation under GAAP.



     “Consolidated EBITDA” means, for any period, the Consolidated Net Income of the
Borrower and its Restricted Subsidiaries for such period, plus (a) an amount equal to any
extraordinary loss plus any net loss realized by the Borrower or any of its Restricted Subsidiaries
in connection with an Asset Disposition, to the extent such losses were deducted in computing such
Consolidated Net Income, plus (b) provision for taxes based on income or profits of the
Borrower and its Restricted Subsidiaries for such period, to the extent that such provision for
taxes was deducted in computing such Consolidated Net Income, plus (c) Consolidated
Interest Expense for such period, whether paid or accrued and whether or not capitalized, to the
extent



5









 




that any such expense was deducted in computing such Consolidated Net Income, plus (d)
depreciation, amortization (including amortization of intangibles but excluding amortization of
prepaid cash expenses that were paid in a prior period) and other non-cash expenses (excluding any
such non-cash expense to the extent that it represents an accrual of or reserve for cash expenses
in any future period or amortization of a prepaid cash expense that was paid in a prior period) of
the Borrower and its Restricted Subsidiaries for such period to the extent that such depreciation,
amortization and other non-cash expenses were deducted in computing such Consolidated Net Income,
minus (e) non-cash items increasing such Consolidated Net Income for such period, other
than the accrual of revenue in the ordinary course of business, in each case, on a Consolidated
basis and determined in accordance with GAAP. For purposes of this Agreement, Consolidated EBITDA
shall be adjusted on a pro forma basis, in a manner reasonably acceptable to the
Administrative Agent, to include, as of the first day of any applicable period, any Permitted
Acquisitions (if accounted for as a merger or consolidation) and any Asset Dispositions (excluding
any Asset Disposition for an aggregate consideration of $10,000,000 or less) closed during such
period, including, without limitation, adjustments reflecting any non-recurring costs and any
extraordinary expenses of any Permitted Acquisitions and any Asset Dispositions closed during such
period calculated on a basis consistent with GAAP and Regulation S-X of the Securities Exchange Act
of 1934, as amended, or as approved by the Administrative Agent.




     “Consolidated Fixed Charge Coverage Ratio” means, for any period, the ratio of
Consolidated EBITDA for such period to the Consolidated Fixed Charges for such period. In the
event that the Borrower or any of its Restricted Subsidiaries incurs, assumes, guarantees, repays,
repurchases or redeems any Indebtedness (other than ordinary working capital borrowings) or issues,
repurchases or redeems preferred stock subsequent to the commencement of the period for which the
Consolidated Fixed Charge Coverage Ratio is being calculated and on or prior to the date as of
which the calculation of the Consolidated Fixed Charge Coverage Ratio is made (the
“Consolidated Fixed Charges Calculation Date”), then the Consolidated Fixed Charge Coverage
Ratio shall be calculated giving pro forma effect to such incurrence, assumption,
guarantee, repayment, repurchase or redemption of Indebtedness, or such issuance, repurchase or
redemption of preferred stock, and the use of the proceeds therefrom, as if the same had occurred
at the beginning of the applicable four-quarter reference period.



     In addition, for purposes of calculating the Consolidated Fixed Charge Coverage Ratio: (i)
acquisitions that have been made by the Borrower or any of its Restricted Subsidiaries, including
through mergers or consolidations and including any related financing transactions, during the
four-quarter reference period or subsequent to such reference period and on or prior to the
Consolidated Fixed Charges Calculation Date shall be given pro forma effect as if
they had occurred on the first day of the four-quarter reference period, (ii) the Consolidated
EBITDA attributable to discontinued operations, as determined in accordance with GAAP, and
operations or businesses disposed of prior to the Consolidated Fixed Charges Calculation Date,
shall be excluded, and (iii) the Consolidated Fixed Charges attributable to discontinued
operations, as determined in accordance with GAAP, and operations or businesses disposed of prior
to the Consolidated Fixed Charges Calculation Date, shall be excluded, but only to the extent that
the obligations giving rise to such Consolidated Fixed Charges will not be obligations of the
Borrower or any of its Restricted Subsidiaries following the Consolidated Fixed Charges Calculation
Date.



6









 





     For purposes of making the computations referred to above, the pro forma
change in Consolidated EBITDA projected by the Borrower in good faith as a result of reasonably
identifiable and factually supportable cost savings and costs, as the case may be, expected to be
realized during the consecutive four-quarter period commencing after an acquisition or similar
transaction (the “Savings Period”) will be included in such calculation for any reference
period that includes any of the Savings Period; provided that any such pro
forma change to such Consolidated EBITDA will be without duplication for cost savings and
costs actually realized and already included in such Consolidated EBITDA. If since the beginning
of such period any Person (that subsequently became a Restricted Subsidiary or was merged with or
into the Borrower or any Restricted Subsidiary since the beginning of such period) will have made
any Investment, acquisition, disposition, merger or consolidation or discontinued operations that
would have required adjustment pursuant to this definition, then the Consolidated Fixed Charge
Coverage Ratio will be calculated giving pro forma effect thereto for such period
as if such Investment, acquisition, disposition, merger, consolidation or discontinued operation
had occurred at the beginning of the applicable four-quarter period.



     “Consolidated Fixed Charges” means, for any period, the sum of the following
determined on a Consolidated basis, without duplication, for the Borrower and its Restricted
Subsidiaries in accordance with GAAP: (a) Consolidated Interest Expense, whether paid or accrued,
excluding amortization of debt issuance costs and original issue discount and other non-cash
interest payments, plus, (b) the consolidated interest that was capitalized during such
period, plus, (c) any interest expense on Indebtedness of another Person that is a Guaranty
Obligation of the Borrower or one of its Restricted Subsidiaries or secured by a Lien on assets of
the Borrower or one of its Restricted Subsidiaries, whether or not such Guaranty Obligation or Lien
is called upon, plus, (d) the product of (i) all dividends, whether paid or accrued and
whether or not in cash, on any series of preferred stock, other than (1) dividends on Capital Stock
payable in Capital Stock of the Borrower (other than Disqualified Stock) or (2) dividends to the
Borrower or a Restricted Subsidiary of the Borrower, times (ii) a fraction, the numerator of which
is one and the denominator of which is one minus the then current combined federal, state and local
effective cash tax rate of the Borrower, expressed as a decimal.



     “Consolidated Interest Expense” means, with respect to the Borrower and its Restricted
Subsidiaries for any period, the interest expense (including, without limitation, interest expense
attributable to Capital Leases and all net payment obligations pursuant to Hedging Agreements) of
the Borrower and its Restricted Subsidiaries, all determined for such period on a Consolidated
basis, without duplication, in accordance with GAAP.



     “Consolidated Net Income” means, with respect to the Borrower and its Restricted
Subsidiaries, for any period, the aggregate of the Net Income of the Borrower and its Restricted
Subsidiaries for such period, on a Consolidated basis, determined in accordance with GAAP;
provided that: (a) the Net Income (but not loss) of any Person that is not a Restricted
Subsidiary or that is accounted for by the equity method of accounting will be included only to the
extent of the amount of dividends or distributions paid in cash to the Borrower or a Restricted
Subsidiary, (b) the Net Income of any Restricted Subsidiary will be excluded to the extent that the
declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that
Net Income is not at the date of determination permitted without any prior governmental approval
(that has not been obtained) or, directly or indirectly, by operation of the terms of its



7









 




charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Restricted Subsidiary or its stockholders, (c) the cumulative effect
of a change in accounting principles will be excluded, and (d) the Net Income or loss of any
Unrestricted Subsidiary will be excluded, whether or not distributed to the Borrower or one of its
Subsidiaries.




     “Consolidated Secured Debt” means as of any date of determination with respect to the
Borrower and its Restricted Subsidiaries on a Consolidated basis without duplication, the sum of
all Indebtedness of the Borrower and its Restricted Subs that is secured by a Lien on any asset or
property of the Borrower or any of its Restricted Subsidiaries.



     “Consolidated Secured Leverage Ratio” means, as of any date of determination, the
ratio of (a) Consolidated Secured Debt as of such date to (b) Consolidated EBITDA for the most
recently ended period of four (4) consecutive fiscal quarters for which financial statements have
been delivered pursuant to Section 7.1 ending on or immediately prior to such date.



     “Consolidated Tangible Assets” means the total assets, less goodwill and other
intangibles, shown on the Borrower’s most recent Consolidated balance sheet, determined on a
Consolidated basis in accordance with GAAP less all write-ups (other than write-ups in connection
with acquisitions) subsequent to the Closing Date in the book value of any asset (except any such
intangible assets) owned by the Borrower or any of its Restricted Subsidiaries.



     “Consolidated Total Indebtedness” means, as of any date of determination with respect
to the Borrower and its Restricted Subsidiaries on a Consolidated basis without duplication, the
sum of all Indebtedness of the Borrower and its Restricted Subsidiaries.



     “Consolidated Total Leverage Ratio” means, as of any date of determination, the ratio
of (a) Consolidated Total Indebtedness on such date to (b) Consolidated EBITDA for the most
recently ended period of four (4) consecutive fiscal quarters for which financial statements have
been delivered pursuant to Section 7.1 ending on or immediately prior to such date.



     “Continuing Directors” means, as of any date of determination, any member of the board
of directors of the Borrower who (i) was a member of such board of directors on the Closing Date or
(ii) was nominated for election or elected to such board of directors with the approval of a
majority of the Continuing Directors who were members of such board of directors at the time of
such nomination or election.



     “Credit Facility” means, collectively, the Revolving Credit Facility, the Swingline
Facility and the L/C Facility.



     “Credit Parties” means, collectively, the Borrower and the Subsidiary Guarantors.



     “Default” means any of the events specified in Section 11.1 that with the
passage of time, the giving of notice or any other condition, would constitute an Event of Default.



     “Defaulting Lender” means any Lender that (a) has failed to fund any portion of the
Revolving Credit Loans, participations in L/C Obligations or participations in Swingline Loans
required to be funded by it hereunder within one Business Day of the date required to be funded



8









 




by it hereunder and such failure continues to exist, (b) has otherwise failed to pay over to
the Administrative Agent or any other Lender any other amount required to be paid by it hereunder
within one Business Day of the date when due and such failure continues to exist, unless such
amount is the subject of a good faith dispute, or (c) has been deemed insolvent or become the
subject of a bankruptcy or insolvency proceeding.




     “Designated Asset Contract” means each of the following contracts pursuant to which
the Borrower or any of its Restricted Subsidiaries has granted (a) an option to purchase a
Designated Asset for the Designated Asset Value or (b) a right of reversion of all or a portion of
the Borrower or a Restricted Subsidiary’s ownership in such Designated Assets, in each case as in
effect on the date of this Agreement: (i) Standard Form Lease Agreement, East Mesa Detention
Facility, dated October 30, 1997, between the County of San Diego and Corrections Corporation of
America; (ii) Lease Agreement, dated April 30, 1996, between Huerfano County and Corrections
Corporation of America; (iii) Request for Proposal Number 0467-019-955259 Issued on behalf of the
Georgia Department of Corrections re: Bid of Private Prisons in Coffee and Wheeler Counties; (iv)
Contract No. 467-019-955259-1, dated July 24, 1996, between the Georgia Department of Corrections
and Corrections Corporation of America; (v) Contract No. 467-019-955259-2, dated July 24, 1996,
between the Georgia Department of Corrections and Corrections Corporation of America; (vi)
Agreement, dated October 6, 1998, between the Tallahatchie County Correctional Authority and
Corrections Corporation of America, as amended by that certain Amendment No. 1 to Agreement dated
May 18, 2000, between the Tallahatchie County Correctional Authority and Corrections Corporation of
America; (vii) Contract for Facility Development — Design, Build, dated July 22, 1998, between the
Montana Department of Corrections and Corrections Corporation of America; (viii) Contractual
Agreement, dated July 1, 1997, between the State of Oklahoma Department of Corrections and
Corrections Corporation of America; (ix) Correctional Services Contract, dated July 1, 1998,
between the State of Oklahoma Department of Corrections and Corrections Corporation of America; (x)
Lease Agreement, dated April 15, 1985, between the County of Shelby and Corrections Corporation of
America; (xi) Contract, dated February 25, 1986, between the Tennessee Department of Finance and
Administration and Corrections Corporation of America; (xii) Lease Agreement, dated January 1997,
between the District of Columbia and Corrections Corporation of America; (xiii) Incarceration
Agreement, dated October 23, 2002, between the State of Tennessee, Department of Correction and
Hardeman County, Tennessee and the related Contract for the Lease of Whiteville Correctional
Facility, dated October 9, 2002, between Hardeman County, Tennessee and Corrections Corporation of
America; (xiv) Management Services Contract between Citrus County, Florida and Corrections
Corporation of America, effective October 1, 2005, relating to construction of a 360-bed expansion
to the Citrus County Detention Facility, Lecanto, Florida; and (xv) any contract entered into after
the Closing Date under which the Borrower or any of its Restricted Subsidiaries has granted (a) an
option to purchase a Designated Asset for the Designated Asset Value or (b) a right of reversion of
all or a portion of its ownership in such Designated Asset; provided that such contract is
entered into in the ordinary course of business, is consistent with past practices and is preceded
by a resolution of the board of directors of the Borrower set forth in an officer’s certificate, in
form and substance reasonably satisfactory to the Administrative Agent, certifying that such
contract has been approved by a majority of the members of the board of directors of the Borrower
and the option to purchase or right to reversion in such contract is on terms the board of
directors of the Borrower has determined to be reasonable and in the best interest of the Borrower.



9









 





     “Designated Asset Value” means the aggregate consideration specified in a Designated
Asset Contract to be received by the Borrower or a Restricted Subsidiary upon the exercise of an
option to acquire a Designated Asset pursuant to the terms of a Designated Asset Contract.



     “Designated Assets” means those Prison Facilities owned by the Borrower or any of its
Restricted Subsidiaries that are located in San Diego, California; Walensburg, Colorado; Lecanto,
Florida; Nichols, Georgia; Alamo, Georgia; Tutweiler, Mississippi; Shelby, Montana; Cushing,
Oklahoma; Holdenville, Oklahoma; Memphis, Tennessee; Whiteville, Tennessee; and Washington, D.C.;
and other Prison Facilities acquired by the Borrower or a Restricted Subsidiary after the Closing
Date, in each case so long as, and to the extent that, the Borrower or such Restricted Subsidiary
has granted an option to purchase such Prison Facility (or provided for the reversion of the
Borrower’s (or such Restricted Subsidiary’s) ownership interest in all or a portion of such Prison
Facility) pursuant to a Designated Asset Contract. The book value of each of the Prison Facilities
designated as Designated Assets as of December 31, 2006 is set forth on Schedule 1.1(c).



     “Designated Non-Cash Consideration” means the fair market value of the total
consideration received by the Borrower or any of its Restricted Subsidiaries in connection with an
Asset Disposition that is so designated as Designated Non-Cash Consideration pursuant to an
officer’s certificate of the Borrower, setting forth the basis of such valuation, executed by the
Borrower’s principal executive officer or principal financial officer, less the amount of cash or
Cash Equivalents received in connection with the Asset Disposition, in form reasonably satisfactory
to the Administrative Agent; provided, however, that if the Designated Non-Cash
Consideration is in the form of Indebtedness the total amount of such Designated Non-Cash
Consideration outstanding at one time shall not exceed the greater of (a) $15,000,000 and (b) 2.50%
of Consolidated Tangible Assets.



     “Disputes” means any dispute, claim or controversy arising out of, connected with or
relating to this Agreement or any other Loan Document, between or among parties hereto and to the
other Loan Documents.



     “Disqualified Stock” means any Capital Stock issued by any Credit Party that, by its
terms (or by the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of the Capital Stock), or upon the happening
of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or redeemable at the option of the holder of the Capital Stock, prior to the date that
is six (6) months after the Revolving Credit Maturity Date. Notwithstanding the preceding
sentence, any Capital Stock that would constitute Disqualified Stock solely because the holders of
the Capital Stock have the right to require the Borrower to repurchase such Capital Stock upon the
occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the
terms of such Capital Stock provide that the Borrower may not repurchase or redeem any such Capital
Stock pursuant to such provisions unless such repurchase or redemption complies with the provisions
of this Agreement.



     “Dollars” or “$” means, unless otherwise qualified, dollars in lawful currency of the
United States.



10









 





     “Domestic Subsidiary” means any Subsidiary organized under the laws of any political
subdivision of the United States.



     “Eligible Assignee” means any Person that satisfies all of the requirements to be an
assignee under Section 13.10(b)(iii), (iv), (v) and (vi) (subject
to such consents, if any, as may be required under Section 13.10(b)(iii)).



     “Employee Benefit Plan” means (a) any employee benefit plan within the meaning of
Section 3(3) of ERISA that is maintained for employees of any Credit Party or (b) any Pension Plan
or Multiemployer Plan that has at any time within the preceding six (6) years been maintained for
the employees of any Credit Party or any current or former ERISA Affiliate.



     “Environmental Claims” means any and all administrative, regulatory or judicial
actions, suits, demands, demand letters, claims, liens, accusations, allegations, notices of
noncompliance or violation, investigations (other than internal reports prepared by any Person in
the ordinary course of business and not in response to any third party action or request of any
kind) or proceedings relating in any way to any actual or alleged violation of or liability under
any Environmental Law or relating to any permit issued, or any approval given, under any such
Environmental Law, including, without limitation, any and all claims by Governmental Authorities
for enforcement, cleanup, removal, response, remedial or other actions or damages, contribution,
indemnification cost recovery, compensation or injunctive relief resulting from Hazardous Materials
or arising from alleged injury or threat of injury to human health or the environment.



     “Environmental Laws” means any and all federal, foreign, state, provincial and local
laws, statutes, ordinances, codes, rules, standards and regulations, permits, licenses, approvals,
interpretations and orders of courts or Governmental Authorities, relating to the protection of the
environment, including, but not limited to, requirements pertaining to the manufacture, processing,
distribution, use, treatment, storage, disposal, transportation, handling, reporting, licensing,
permitting, investigation or remediation of Hazardous Materials.



     “Equity Issuance” means any issuance by the Borrower or any Restricted Subsidiary to
any Person that is not a Credit Party of (a) shares of its Capital Stock, (b) any shares of its
Capital Stock pursuant to the exercise of options or warrants or (c) any shares of its Capital
Stock pursuant to the conversion of any debt securities to equity.



     “ERISA” means the Employee Retirement Income Security Act of 1974, and the rules and
regulations thereunder, each as amended or modified from time to time.



     “ERISA Affiliate” means any Person who together with the Borrower or any Subsidiary of
the Borrower is treated as a single employer within the meaning of Section 414(b), (c), (m) or (o)
of the Code or Section 4001(b) of ERISA.



     “Eurodollar Reserve Percentage” means, for any day, the percentage (expressed as a
decimal and rounded upwards, if necessary, to the next higher 1/100th of 1%) that is in effect for
such day as prescribed by the Board of Governors of the Federal Reserve System (or any successor)
for determining the maximum reserve requirement (including, without limitation, any



11









 




basic, supplemental or emergency reserves) in respect of eurocurrency liabilities or any
similar category of liabilities for a member bank of the Federal Reserve System in New York City.




     “Event of Default” means any of the events specified in Section 11.1;
provided that any requirement for passage of time, giving of notice, or any other
condition, has been satisfied.



     “Excess Proceeds” has the meaning assigned thereto in Section 10.4(p).



     “Excluded Taxes” means, with respect to the Administrative Agent, any Lender, any
applicable 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 and excise taxes imposed on it (in lieu of net income taxes),
by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient
is organized or in which its principal office is located or, in the case of any Lender, in which
its applicable Lending Office is located, (b) any branch profits taxes imposed by the United States
or any similar tax imposed by any other jurisdiction in which the Borrower is located and (c) in
the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under
Section 4.12(b)), 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)
or is attributable to such Foreign Lender’s failure or inability (other than as a result of a
Change in Law) to comply with Section 4.11(e), except to the extent that such Foreign
Lender (or its assignor, if any) was entitled, at the time of designation of a new Lending Office
(or assignment), to receive additional amounts from the Borrower with respect to such withholding
tax pursuant to Section 4.11(a).



     “Existing Credit Facility” means that certain Credit Agreement dated as of February 3,
2006, by and among the Borrower, the lenders party thereto and Wachovia Bank, National Association,
as administrative agent, as amended prior to the date hereof.



     “Existing Letters of Credit” means those letters of credit issued by Bank of America
and Wachovia, existing prior to the Closing Date and identified on Schedule 1.1(a).



     “Extensions of Credit” means, as to any Lender at any time, (a) an amount equal to the
sum of (i) the aggregate principal amount of all Revolving Credit Loans made by such Lender then
outstanding, (ii) such Lender’s Revolving Credit Commitment Percentage of the L/C Obligations then
outstanding, (iii) such Lender’s Revolving Credit Commitment Percentage of the Swingline Loans then
outstanding, or (b) the making of any Loan or participation in any Letter of Credit by such Lender,
as the context requires.



     “FDIC” means the Federal Deposit Insurance Corporation, or any successor thereto.



     “Federal Funds Rate” means, the rate per annum (rounded upwards, if necessary, to the
next higher 1/100th of 1%) representing the daily effective federal funds rate as quoted by the
Administrative Agent and confirmed in Federal Reserve Board Statistical Release H.15 (519) or any
successor or substitute publication selected by the Administrative Agent. If, for any reason, such
rate is not available, then “Federal Funds Rate” shall mean a daily rate that is
determined, in the opinion of the Administrative Agent, to be the rate at which federal funds are
being offered



12









 




for sale in the national federal funds market at 9:00 a.m. Rates for weekends or holidays
shall be the same as the rate for the most immediately preceding Business Day.




     “Fee Letters” means, collectively, (i) the letter agreement, dated November 27, 2007,
among the Borrower, the Administrative Agent and BAS and (ii) the letter agreement, dated November
27, 2007, among the Borrower, the Administrative Agent, BAS and WCM.



     “Fiscal Year” means each fiscal year of the Borrower and its Subsidiaries ending on
December 31.



     “Foreign Lender” means 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, each State thereof and the District of Columbia shall be deemed to
constitute a single jurisdiction.



     “Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.



     “GAAP” means generally accepted accounting principles, as recognized by the American
Institute of Certified Public Accountants and the Financial Accounting Standards Board,
consistently applied and maintained on a consistent basis for the Borrower and its Subsidiaries
throughout the period indicated and (subject to Section 13.9) consistent with the prior
financial practice of the Borrower and its Subsidiaries.



     “Governmental Approvals” means all authorizations, consents, approvals, permits,
licenses and exemptions of, registrations and filings with, and reports to, all Governmental
Authorities.



     “Governmental Authority” means the government of the United States 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).



     “Government Securities” means securities issued or directly and fully guaranteed or
insured by the United States government or any agency or instrumentality of the United States
government (provided that the full faith and credit of the United States is pledged in support of
those securities).



     “Guaranty Obligation” means, with respect to the Borrower and its Restricted
Subsidiaries, without duplication, any obligation, contingent or otherwise, of any such Person
pursuant to which such Person has directly or indirectly guaranteed any Indebtedness of any other
Person including, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of any such Person (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness (whether arising by virtue of partnership
arrangements, by agreement to keep well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement condition or otherwise) or (b) entered into for the
purpose of assuring in any other manner the obligee of such Indebtedness of the



13









 




payment thereof or to protect such obligee against loss in respect thereof (in whole or in
part); provided, that the term Guaranty Obligation shall not include endorsements for
collection or deposit in the ordinary course of business; provided further that the
term Guaranty Obligations shall not include any Indebtedness of the Borrower under the Forward
Delivery Deficits Agreement, dated as of September 25, 1997, by and between the Borrower and
Wachovia Bank, National Association, as trustee, or under the Debt Service Deficits Agreement,
dated as of January 1, 1997, by and between the Borrower and Hardeman County Correctional
Facilities Corporation, or the Bond Reserve guaranty included in the Residential Services
Agreement, dated as of April 14, 1999, by and between the Borrower and the City of Eden, Texas,
each as in effect on the Closing Date, provided that and for so long as such Indebtedness
is not required to be classified as debt of the Borrower or any Restricted Subsidiary pursuant to
GAAP.




     “Hazardous Materials” means any substances or materials (a) that are or become defined
as hazardous wastes, hazardous substances, pollutants, contaminants, or toxic substances under any
Environmental Law, (b) that are toxic, explosive, corrosive, flammable, infectious, radioactive,
carcinogenic, mutagenic or otherwise harmful to human health or the environment and are or become
regulated by any Governmental Authority, (c) the presence of which requires investigation or
remediation under any Environmental Law, (d) the discharge or emission or release of which requires
a permit or license under any Environmental Law, (e) that are deemed to constitute a nuisance or a
trespass that pose a health or safety hazard to Persons or neighboring properties under any
Environmental Law, or (f) that contain asbestos, polychlorinated biphenyls, urea formaldehyde foam
insulation, petroleum hydrocarbons, petroleum derived substances or waste, crude oil or nuclear
fuel.



     “Hedging Agreement” means any agreement with respect to any Interest Rate Contract,
forward rate agreement, commodity swap, forward foreign exchange agreement, currency swap
agreement, cross-currency rate swap agreement, currency option agreement or other agreement or
arrangement designed to alter the risks of any Person arising from fluctuations in interest rates,
currency values or commodity prices, all as amended, restated, supplemented or otherwise modified
from time to time.



     “Hedging Obligations” means all existing or future payment and other obligations owing
by the Borrower under any Hedging Agreement (which such Hedging Agreement is permitted hereunder)
with any Person that is a Lender or an Affiliate of a Lender at the time such Hedging Agreement is
executed.



     “Incremental Revolving Credit Commitment Effective Date” means the date, which shall
be a Business Day, on or before the Revolving Credit Maturity Date, but no earlier than thirty (30)
days after the date of delivery of the applicable Incremental Revolving Credit Commitment
Notification (unless a shorter period is agreed to by the affected Lenders), on which each of the
applicable increases to the Revolving Credit Commitment shall become effective pursuant to
Section 2.7.



     “Incremental Revolving Credit Commitment Notification” has the meaning assigned
thereto in Section 2.7.




14












 





     “Incremental Term Loan Agreement” means each agreement executed pursuant to
Section 2.8 by the Borrower and an existing Lender or a Person not theretofore a Lender, as
applicable, and acknowledged by the Administrative Agent and each Subsidiary Guarantor, providing
for an Incremental Term Loan hereunder, acknowledging that any Person not theretofore a Lender
shall be a party hereto and have the rights and obligations of a Lender hereunder, and setting
forth the Incremental Term Loan Commitment of such Lender.



     “Incremental Term Loan Commitment” means (a) as to any Lender, the obligation of such
Lender to make Incremental Term Loans to or for the account of the Borrower hereunder in an
aggregate principal amount not to exceed the amount set forth opposite such Lender’s name on the
Register, as such amount may be increased, reduced or otherwise modified at any time or from time
to time pursuant to the terms hereof and (b) as to all Lenders, the aggregate obligations of all
Lenders to make the Incremental Term Loans, as applicable to the account of the Borrower, as such
amount may be increased, reduced or otherwise modified at any time or from time to time. The
Incremental Term Loan Commitment of all Lenders as of the Closing Date shall be $0.



     “Incremental Term Loan Effective Date” means the date, which shall be a Business Day,
on or before the Revolving Credit Maturity Date, but no earlier than thirty (30) days after the
date of delivery of the applicable Incremental Term Loan Notification (unless a shorter period is
agreed to by the affected Lenders), on which each of the Incremental Term Loan Lenders shall make
Incremental Term Loans to the Borrower pursuant to Section 2.8.



     “Incremental Term Loan Lender” has the meaning assigned thereto in Section
2.8.



     “Incremental Term Loan Notification” has the meaning assigned thereto in Section
2.8(a).



     “Incremental Term Loans” means any incremental term loans made to the Borrower
pursuant to Section 2.8, and all such incremental term loans collectively as the context
requires.



     “Indebtedness” means, with respect to the Borrower and its Restricted Subsidiaries at
any date and without duplication, the sum of the following calculated in accordance with GAAP:



     (a) all liabilities, obligations and indebtedness for borrowed money including, but not
limited to, obligations evidenced by bonds, debentures, notes or other similar instruments of any
such Person;



     (b) all obligations to pay the deferred purchase price of property or services of any such
Person (including, without limitation, all obligations under non-competition, earn-out or similar
agreements), excluding trade payables arising in the ordinary course of business;



     (c) the Attributable Indebtedness of such Person with respect to such Person’s obligations in
respect of Capital Leases and Synthetic Leases;



     (d) all Indebtedness of any other Person secured by a Lien on any asset owned or being
purchased by such Person (including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been assumed by such



15









 







Person or is limited in recourse (but excluding any such Indebtedness arising as a result of a
Lien on the Capital Stock of Agecroft);



     (e) all Guaranty Obligations of any such Person;



     (f) all obligations, contingent or otherwise, of any such Person relative to the face amount
of letters of credit, whether or not drawn, including, without limitation, any Reimbursement
Obligation, and banker’s acceptances issued for the account of any such Person;



     (g) all obligations of any such Person to redeem, repurchase, exchange, defease or otherwise
make payments in respect of Capital Stock of such Person; and



     (h) all Net Hedging Obligations.



     For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any
partnership or joint venture (other than a joint venture that is itself a corporation or limited
liability company) in which such Person is a general partner or a joint venturer, unless such
Indebtedness is expressly made non-recourse to such Person.



     “Indemnified Taxes” means Taxes and Other Taxes other than Excluded Taxes.



     “Information” has the meaning assigned thereto in Section 13.11.



     “Interest Period” has the meaning assigned thereto in Section 4.1(b).



     “Interest Rate Contract” means any interest rate swap agreement, interest rate cap
agreement, interest rate floor agreement, interest rate collar agreement, interest rate option or
any other agreement regarding the hedging of interest rate risk exposure of any Person and any
confirming letter executed pursuant to such agreement, all as amended, restated, supplemented or
otherwise modified from time to time.



     “Investments” means, with respect to any Person, without duplication, all direct or
indirect investments by such Person in other Persons (including Affiliates) in the forms of loans
(including Guaranty Obligations or other obligations), advances or capital contributions (excluding
commission, travel and similar advances to officers and employees made in the ordinary course of
business), purchases or other acquisitions for consideration of Indebtedness, Capital Stock or
other securities, together with all items that are or would be classified as investments on a
balance sheet prepared in accordance with GAAP.



     “ISP98” means the International Standby Practices (1998 Revision, effective January 1,
1999), International Chamber of Commerce Publication No. 590.



     “Issuing Lender” means (a) Bank of America, in its capacity as issuer of any Letters
of Credit, or any successor thereto, (b) Wachovia, in its capacity as issuer of any Letters of
Credit, or any successor thereto and (c) any Additional Issuing Lender, in its capacity as issuer
of any Letters of Credit. If there is more than one Issuing Lender at any time, the term “Issuing
Lender” shall be deemed to refer to each of them individually.



16









 





     “L/C Commitment” means the lesser of (a) One Hundred Million Dollars ($100,000,000)
and (b) the Revolving Credit Commitment.



     “L/C Facility” means the letter of credit facility established pursuant to Article
III.



     “L/C Obligations” means at any time, an amount equal to the sum of (a) the aggregate
undrawn and unexpired amount of the then outstanding Letters of Credit and (b) the aggregate amount
of drawings under Letters of Credit that have not then been reimbursed pursuant to Section
3.5.



     “L/C Participants” means the collective reference to all the Lenders other than the
applicable Issuing Lender.



     “Lender” means each Person executing this Agreement as a Lender (including, without
limitation, the applicable Issuing Lender and the Swingline Lender unless the context otherwise
requires) set forth on the signature pages hereto and each Person that hereafter becomes a party to
this Agreement as a Lender pursuant to Section 2.7, Section 2.8 or Section
13.10.



     “Lender Addition and Acknowledgment Agreement” means each agreement executed pursuant
to Section 2.7 by the Borrower and an existing Lender or a Person not theretofore a Lender,
as applicable, and acknowledged by the Administrative Agent and each Subsidiary Guarantor,
providing for an increase in the Revolving Credit Commitment hereunder, acknowledging that any
Person not theretofore a Lender shall be a party hereto and have the rights and obligations of a
Lender hereunder, and setting forth the Revolving Credit Commitment of such Lender.



     “Lending Office” means, with respect to any Lender, the office of such Lender
maintaining such Lender’s Extensions of Credit.



     “Letter of Credit Application” means an application, in the form specified by the
applicable Issuing Lender from time to time, requesting the applicable Issuing Lender to issue a
Letter of Credit.



     “Letters of Credit” means the collective reference to letters of credit issued
pursuant to Section 3.1 and the Existing Letters of Credit.



     “LIBOR” means, for any Interest Period, the rate per annum equal to the British
Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other
commercially available source providing quotations of BBA LIBOR as designated by the Administrative
Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such
Interest Period) with a term equivalent to such Interest Period. If such rate is not available at
such time for any reason, then “LIBOR” for such Interest Period shall be the rate per annum
determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on
the first day of such Interest Period in same day funds in the approximate amount of the LIBOR Rate
Loans being made, continued or converted by Bank of America and with a term equivalent to such
Interest Period would be offered by Bank of America’s London Branch to



17









 







major banks in the London interbank eurodollar market at their request at approximately 11:00
a.m. (London time) two Business Days prior to the commencement of such Interest Period



     “LIBOR Rate” means a rate per annum (rounded upwards, if necessary, to the next higher
1/100th of 1%) determined by the Administrative Agent pursuant to the following formula:







     “LIBOR Rate Loan” means any Loan bearing interest at a rate based upon the LIBOR Rate
as provided in Section 4.1(a).



     “Lien” means, with respect to any asset, any mortgage, leasehold mortgage, lien,
pledge, charge, security interest, hypothecation or encumbrance of any kind in respect of such
asset. For the purposes of this Agreement, a Person shall be deemed to own subject to a Lien any
asset that it has acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, Capital Lease or other title retention agreement relating to such asset
and having substantially the same economic effect as any of the foregoing.



     “Loan Documents” means, collectively, this Agreement, each Note, the Letter of Credit
Applications, the Subsidiary Guaranty Agreement, the Security Documents, and each other document,
instrument, certificate and agreement executed and delivered by the Borrower or any Restricted
Subsidiary in connection with this Agreement or otherwise referred to herein or contemplated hereby
(excluding any Hedging Agreement), all as may be amended, restated, supplemented or otherwise
modified from time to time.



     “Loans” means the collective reference to the Revolving Credit Loans and the Swingline
Loans and “Loan” means any of such Loans.



     “Material Adverse Effect” means a material adverse effect on (a) the properties,
business, operations or condition (financial or otherwise) of the Borrower and its Restricted
Subsidiaries, taken as a whole, or (b) the ability of the Borrower and its Restricted Subsidiaries,
taken as a whole, to perform their obligations under the Loan Documents to which they are parties.



     “Material Indebtedness” means (a) any Indebtedness or Guaranty Obligations of the
Borrower or any of its Restricted Subsidiaries involving monetary liability of or to any such
Person in an amount in excess of $20,000,000 per annum, (b) the Senior Unsecured Notes and any
documents related thereto, and (c) the documentation governing any Qualified Trust Indebtedness.



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



     “Multiemployer Plan” means a “multiemployer plan” as defined in Section 4001(a)(3) of
ERISA to which the Borrower or any ERISA Affiliate is making, or is accruing an obligation to make,
or has accrued an obligation to make contributions within the preceding six (6) years.



     “Net Hedging Obligations” means, as of any date, the Termination Value of any such
Hedging Agreement on such date.



18









 





     “Net Income” means, with respect to the Borrower and its Restricted Subsidiaries for
any period, the net income (loss) of the Borrower and its Restricted Subsidiaries, determined in
accordance with GAAP and before any reduction in respect of preferred stock dividends, excluding,
however: (a) any gain or loss, together with any related provision for taxes on such gain or loss,
realized in connection with: (i) any Asset Disposition; or (ii) the disposition of any securities
by the Borrower or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of
the Borrower or any of its Restricted Subsidiaries (whether by redemption, repurchase, defeasance,
repayment or otherwise), and any related premiums, fees and expenses, (b) any extraordinary gain or
loss, together with any related provision for taxes on such extraordinary gain or loss, (c) any
impairment losses (including, but not limited to, those resulting from impairment of goodwill
recorded on the Consolidated financial statement of the Borrower or a Restricted Subsidiary
pursuant to SFAS No. 142 “Goodwill and Other Intangible Assets” and those resulting from impairment
or disposal of long-lived assets recorded on the Consolidated financial statements of the Borrower
or a Restricted Subsidiary pursuant to SFAS No. 144 “Accounting for the Impairment or Disposal of
Long-Lived Assets,” (d) any loss resulting from the change in fair value of a derivative financial
instrument pursuant to SFAS No. 133 “Accounting for Derivative Instruments and Hedging Activities,”
(e) amortization of debt issuance costs and (f) any Capital Stock-based compensation expense.



     “Net Proceeds” means the aggregate cash proceeds received by the Borrower or any of
its Restricted Subsidiaries in respect of any Asset Disposition (including, without limitation, any
cash or Cash Equivalents received upon the sale or other disposition of any non-cash consideration,
including Designated Non-Cash Consideration received in any Asset Disposition and deemed to be cash
pursuant to and in compliance with Section 10.4(p) hereof), net of the direct costs
relating to such Asset Disposition, including, without limitation, legal, accounting and investment
banking fees, and sales commissions, and any relocation expenses incurred as a result of the Asset
Disposition, taxes paid or payable as a result of the Asset Disposition, in each case, after taking
into account any available tax credits or deductions and any tax sharing arrangements, and amounts
required to be applied to the repayment of Indebtedness (other than Indebtedness under this
Agreement) secured by a Lien on the asset or assets that were the subject of such Asset Disposition
and any reserve for adjustment in respect of the sale price of such asset or assets established in
accordance with GAAP.



     “New Incremental Term Loan Lender” has the meaning assigned thereto in Section
2.8.



     “Notes” means the collective reference to the Revolving Credit Notes and the Swingline
Note.



     “Notice of Account Designation” has the meaning assigned thereto in Section
2.3(b).



     “Notice of Borrowing” has the meaning assigned thereto in Section 2.3(a).



     “Notice of Conversion/Continuation” has the meaning assigned thereto in Section
4.2.



     “Notice of Prepayment” has the meaning assigned thereto in Section 2.4(c).



     “Obligations” means, in each case, whether now in existence or hereafter arising: (a)
the principal of and interest on (including interest accruing after the filing of any bankruptcy or



19









 







similar petition) the Loans, (b) the L/C Obligations, (c) all Hedging Obligations and (d) all
other fees and commissions (including attorneys’ fees), charges, indebtedness, loans, liabilities,
financial accommodations, obligations, covenants and duties owing by the Borrower or any of its
Restricted Subsidiaries to the Lenders or the Administrative Agent, in each case under any Loan
Document, with respect to any Loan or Letter of Credit of every kind, nature and description,
direct or indirect, absolute or contingent, due or to become due, contractual or tortious,
liquidated or unliquidated, and whether or not evidenced by any note.



     “OFAC” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.



     “Officer’s Compliance Certificate” means a certificate of the chief financial officer
or the treasurer of the Borrower substantially in the form of Exhibit F.



     “Operating Lease” means, as to any Person as determined in accordance with GAAP, any
lease of property (whether real, personal or mixed) by such Person as lessee that is not a Capital
Lease.



     “Other Taxes” means 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 assigned thereto in Section 13.11(d).



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



     “Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan, which
is subject to the provisions of Title IV of ERISA or Section 412 of the Code and which (a) is
maintained for the employees of the Borrower or any ERISA Affiliates or (b) has at any time within
the preceding six (6) years been maintained for the employees of the Borrower or any of its current
or former ERISA Affiliates.



     “Permitted Acquisition” means any investment by the Borrower or any Restricted
Subsidiary in the form of acquisitions of all or substantially all of the business or a line of
business (whether by the acquisition of capital stock, assets or any combination thereof) of any
other Person if such acquisition meets all of the following requirements:



     (a) the Person or business to be acquired shall be engaged primarily in a Permitted Business;



     (b) if such transaction is a merger or consolidation, the Borrower or a Restricted Subsidiary
shall be the surviving Person and no Change of Control shall have been effected thereby;



     (c) the Borrower shall deliver to the Administrative Agent such documents reasonably requested
by the Administrative Agent pursuant to Section 8.11 to be delivered at the time required
pursuant to Section 8.11;



20









 





     (d) in the case of any acquisition with an aggregate purchase price greater than $50,000,000,
no later than five (5) Business Days prior to the proposed closing date of such acquisition, the
Borrower (A) shall have delivered to the Administrative Agent promptly upon the finalization
thereof copies of substantially final Permitted Acquisition Documents, which shall be in form and
substance reasonably satisfactory to the Administrative Agent, and (B) shall have delivered to, or
made available for inspection by, the Administrative Agent substantially complete Permitted
Acquisition Diligence Information, which shall be in form and substance reasonably satisfactory to
the Administrative Agent;



     (e) no Default or Event of Default shall have occurred and be continuing both before and after
giving effect to such acquisition; and



     (f) the Borrower shall provide such other documents and other information as may be reasonably
requested by the Administrative Agent in connection with the acquisition.



     “Permitted Acquisition Diligence Information” means with respect to any acquisition
proposed by the Borrower or any Restricted Subsidiary, to the extent applicable, all material
financial information, all material contracts, all material customer lists, all material supply
agreements, and all other material information, in each case, reasonably requested to be delivered
to the Administrative Agent in connection with such acquisition (except to the extent that any such
information is (a) subject to any confidentiality agreement, unless mutually agreeable arrangements
can be made to preserve such information as confidential, (b) classified or (c) subject to any
attorney-client privilege).



     “Permitted Acquisition Documents” means with respect to any acquisition proposed by
the Borrower or any Restricted Subsidiary, final copies or substantially final drafts if not
executed at the required time of delivery of the purchase agreement, sale agreement, merger
agreement or other material agreement evidencing such acquisition, including, without limitation,
all legal opinions and each other material document executed, delivered, contemplated by or
prepared in connection therewith and any amendment, modification or supplement to any of the
foregoing.



     “Permitted Business” means the business conducted by the Borrower and its Restricted
Subsidiaries on the Closing Date and businesses reasonably related thereto or ancillary or
incidental thereto or a reasonable extension thereof, including the privatization of governmental
services.



     “Permitted Investments” means:



     (a) any Investment in the Borrower or in a Restricted Subsidiary of the Borrower;



     (b) any Investment in cash or Cash Equivalents;



     (c) any Permitted Acquisition;



     (d) any Investment made as a result of the receipt of non-cash consideration (including
Designated Non-Cash Consideration) from an Asset Disposition that was made pursuant to and in
compliance with Section 10.4 hereof;



21









 





     (e) any acquisition of assets solely in exchange for the issuance of Capital Stock (other than
Disqualified Stock) of the Borrower;



     (f) any Investments received in compromise of obligations of trade creditors or customers that
were incurred in the ordinary course of business, including pursuant to any plan of reorganization
or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer;



     (g) Hedging Obligations;



     (h) other Investments in any other Person having an aggregate fair market value (measured on
the date each such Investment was made and without giving effect to subsequent changes in value),
when taken together with all other Investments made pursuant to this subsection (h), not to exceed
$35,000,000;



     (i) payroll, travel and similar advances to cover matters that are expected at the time of
such advances ultimately to be treated as expenses for accounting purposes and that are made in the
ordinary course of business;



     (j) loans or advances to employees made in the ordinary course of business of the Borrower or
any Restricted Subsidiary in an aggregate principal amount not to exceed $5,000,000 outstanding at
any one time;



     (k) stock, obligations or securities received in settlement of debts created in the ordinary
course of business and owing to the Borrower or any Restricted Subsidiary or in satisfaction of
judgments or pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or
insolvency of a debtor;



     (l) Investments in existence on the Closing Date and set forth on Schedule 1.1(b);



     (m) Guaranty Obligations issued in accordance with Section 10.1 hereof;



     (n) Investments that are made with Capital Stock of the Borrower (other than Disqualified
Stock of the Borrower);



     (o) any Investment by the Borrower or any Restricted Subsidiary of the Borrower in joint
ventures in a Permitted Business, when taken together with all other Investments made pursuant to
this subsection (o), not to exceed $15,000,000 outstanding at any one time; and



     (p) any Investment in any Person that is not at the time of such Investment, or does not
thereby become, a Restricted Subsidiary in an aggregate amount (measured on the date such
Investment was made and without giving effect to subsequent changes in value), when taken together
with all other Investments made pursuant to this clause (p) since the Closing Date (but, to the
extent that any Investment made pursuant to this clause (p) since the Closing Date is sold or
otherwise liquidated for cash, minus the lesser of (i) the cash return of capital with respect to
such Investment (less the cost of disposition, if any) and (ii) the initial amount of such
Investment) not to exceed ten percent (10%) of Consolidated Tangible Assets; provided that,
the Borrower or a Restricted Subsidiary has entered, or concurrently with any such Investment



22









 







enters, into a long-term lease or management contract with respect to assets of such Person
that are used or useful in a Permitted Business.



     “Permitted Liens” means the Liens permitted pursuant to Section 10.2.



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



     “PMI Notes” means those certain 4.0% convertible subordinated notes due February 28,
2005 issued pursuant to that certain Note Purchase Agreement, dated as of December 31, 1998, as
amended on June 30, 2000, March 5, 2001 and April 28, 2003, between the Borrower and PMI Mezzanine
Fund, L.P.



     “Prime Rate” means, at any time, the rate of interest per annum publicly announced
from time to time by Bank of America as its prime rate. Each change in the Prime Rate shall be
effective as of the opening of business on the day such change in such prime rate occurs. The
parties hereto acknowledge that the rate announced publicly by Bank of America as its prime rate is
an index or base rate and shall not necessarily be its lowest or best rate charged to its customers
or other banks.



     “Prison Facility” means any prison, correctional, detention or juvenile facilities
owned or operated by the Borrower or any of its Restricted Subsidiaries.



     “Public Lender” has the meaning assigned thereto in Section 7.7.



     “Purchase Notes” means notes or other obligations received by any Credit Party in
connection with an Asset Disposition of an Unoccupied Prison Facility that is otherwise permitted
pursuant to Section 10.4.



     “Qualified Trust” means a trust or other special purpose vehicle formed for the sole
purpose of, and which is limited by its charter or other organizational documents to conduct no
business other than, issuing Qualified Trust Preferred Stock and lending the proceeds from such
issuance to the Borrower.



     “Qualified Trust Indebtedness” means Indebtedness of the Borrower or its Restricted
Subsidiaries to a Qualified Trust (a) in an aggregate principal amount not exceeding the amount of
funds raised by such trust from the issuance of Qualified Trust Preferred Stock and (b) that by its
terms (or by the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the Qualified Trust or the holder of any Qualified
Trust Preferred Stock), or upon the happening of any event, does not mature and is not mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the
Qualified Trust or any holder of the Qualified Trust Preferred Stock, in whole or in part, on or
prior to the date that is 91 days after the Revolving Credit Maturity Date; provided that
such Qualified Trust Indebtedness may be redeemed pursuant to its terms upon a change of control of
the Borrower if the terms of such Qualified Trust Indebtedness (a) define a “change of control” in
a manner that is not more expansive or inclusive than the change of control definition contained in
this Agreement and (b) explicitly provide that no payment shall be made with



23









 







respect to such Indebtedness upon a “change of control” unless such payment is permitted by
the provisions of this Agreement.



     “Qualified Trust Preferred Stock” means a preferred stock or preferred interest in a
Qualified Trust the net proceeds from the issuance of which are used to finance Qualified Trust
Indebtedness and that, by its terms (or by the terms of any security into which it is convertible,
or for which it is exchangeable, in each case at the option of the holder of the Qualified Trust
Preferred Stock), or upon the happening of any event, does not mature and is not mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the
holder of the Qualified Trust Preferred Stock, in whole or in part, on or prior to the date that is
91 days after the Revolving Credit Maturity Date.



     “Refinancing Indebtedness” has the meaning assigned thereto in Section
10.1(k).



     “Register” has the meaning assigned thereto in Section 13.10(c).



     “Reimbursement Obligation” means the obligation of the Borrower to reimburse the
applicable Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of
Credit.



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



     “Required Lenders” means, at any date, any combination of Lenders whose Revolving
Credit Commitments aggregate more than fifty percent (50%) of the Revolving Credit Commitment or,
if the Revolving Credit Commitments have been terminated pursuant to Section 11.2, any
combination of Lenders holding more than fifty percent (50%) of the aggregate Extensions of Credit;
provided that the Revolving Credit Commitment of, and the portion of the Extensions of
Credit, as applicable, held or deemed held by, any Defaulting Lender shall be excluded for purposes
of making a determination of Required Lenders.



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



     “Restricted Investment” means an Investment other than a Permitted Investment.



     “Restricted Payments” has the meaning assigned thereto in Section 10.5.



     “Restricted Subsidiary” means any Subsidiary of the Borrower that is not an
Unrestricted Subsidiary.



     “Revolving Credit Commitment” means (a) as to any Revolving Credit Lender, the
obligation of such Revolving Credit Lender to make Revolving Credit Loans to the account of



24









 







the Borrower hereunder in an aggregate principal amount at any time outstanding not to exceed
the amount set forth opposite such Revolving Credit Lender’s name on the Register, as such amount
may be reduced or modified at any time or from time to time pursuant to the terms hereof and (b) as
to all Revolving Credit Lenders, the aggregate commitment of all Revolving Credit Lenders to make
Revolving Credit Loans, as such amount may be reduced at any time or from time to time pursuant to
the terms hereof. The Revolving Credit Commitment of all Revolving Credit Lenders on the Closing
Date shall be Four Hundred Fifty Million Dollars ($450,000,000).



     “Revolving Credit Commitment Percentage” means, as to any Revolving Lender at any
time, the ratio of (a) the amount of the Revolving Credit Commitment of such Revolving Credit
Lender to (b) the Revolving Credit Commitments of all Revolving Credit Lenders.



     “Revolving Credit Facility” means the revolving credit facility established pursuant
to Article II.



     “Revolving Credit Lenders” means Lenders with a Revolving Credit Commitment.



     “Revolving Credit Loans” means any revolving loan made to the Borrower pursuant to
Section 2.1, and all such revolving loans collectively as the context requires.



     “Revolving Credit Maturity Date” means the earliest to occur of (a) December 21, 2012,
(b) the date of termination of the entire Revolving Credit Commitment by the Borrower pursuant to
Section 2.5(a)(i), or (c) the date of termination of the Revolving Credit Commitment by the
Administrative Agent on behalf of the Lenders pursuant to Section 11.2(a).



     “Revolving Credit Note” means a promissory note made by the Borrower in favor of a
Revolving Credit Lender evidencing the Revolving Credit Loans made by such Lender, substantially in
the form of Exhibit A-1, and any amendments, supplements and modifications thereto, any substitutes
therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.



     “S&P” means Standard & Poor’s Ratings Group.



     “Sanctioned Entity” shall mean (i) an agency of the government of, (ii) an
organization directly or indirectly controlled by, or (iii) a person resident in a country that is
subject to a sanctions program identified on the list maintained by OFAC and available at
http://www.treas.gov/offices/enforcement/ofac/sanctions/index.html, or as otherwise
published from time to time as such program may be applicable to such agency, organization or
person.



     “Sanctioned Person” shall mean a person named on the list of Specially Designated
Nationals or Blocked Persons maintained by OFAC available at http://www.treas.gov/offices/
enforcement/ofac/sdniindex.html, or as otherwise published from time to time.



     “SEC” means the Securities and Exchange Commission.



     “Security Documents” means the collective reference to the Collateral Agreement and
each other agreement or writing pursuant to which any Credit Party purports to pledge or grant a



25









 







security interest in any property or assets securing the Obligations or any such Person
purports to guaranty the payment and/or performance of the Obligations, in each case, as amended,
restated, supplemented or otherwise modified from time to time.



     “Senior Unsecured $150MM Notes” means the Indebtedness of the Borrower evidenced by
its 6.75% Senior Notes due 2014, in the original aggregate principal amount of $150,000,000, issued
pursuant to that certain Base Indenture dated as of January 23, 2006, among the Borrower, certain
of its Subsidiaries and U.S. Bank National Association, as trustee, as amended by First
Supplemental Indenture dated January 23, 2006, in each case, as amended, restated, supplemented or
otherwise modified from time to time as permitted by the terms and conditions of this Agreement.



     “Senior Unsecured $200MM Notes” means the Indebtedness of the Borrower evidenced by
its 7.50% Senior Notes due 2011, in the original aggregate principal amount of $200,000,000, issued
pursuant to that certain Indenture dated as of May 7, 2003 among the Borrower, certain of its
Subsidiaries and U.S. Bank National Association, as trustee, as amended by the Supplemental
Indenture dated May 7, 2003, the First Supplement dated August 8, 2003 and the Second Supplement
dated August 8, 2003, in each case, as amended, restated, supplemented or otherwise modified from
time to time as permitted by the terms and conditions of this Agreement.



     “Senior Unsecured $250MM Notes” means the Indebtedness of the Borrower evidenced by
its 7.50% Senior Notes due 2011, in the original aggregate principal amount of $250,000,000, issued
pursuant to that certain Indenture dated as of May 7, 2003 among the Borrower, certain of its
Subsidiaries and U.S. Bank National Association, as trustee, as amended by the Supplemental
Indenture dated May 7, 2003, in each case, as amended, restated, supplemented or otherwise modified
from time to time as permitted by the terms and conditions of this Agreement.



     “Senior Unsecured $375MM Notes” means the Indebtedness of the Borrower evidenced by
its 6.25% Senior Notes due 2013, in the original principal amount of $375,000,000, issued pursuant
to that certain Indenture dated as of March 23, 2005 among the Borrower, certain of its
Subsidiaries and U.S. Bank National Association, as trustee, as amended, restated, supplemented or
otherwise modified from time to time as permitted by the terms and conditions of this Agreement.



     “Senior Unsecured Notes” means the collective reference to the (i) Senior Unsecured
$200MM Notes, (ii) the Senior Unsecured $250MM Notes, (iii) the Senior Unsecured $375MM Notes, (iv)
the Senior Unsecured $150MM Notes and (v) and any other instruments and agreements entered into by
the Borrower or its Subsidiaries in connection therewith, in each case, as amended, restated,
supplemented or otherwise modified from time to time as permitted by the terms and conditions of
this Agreement.



     “Series A Preferred Stock” means the 8% Series A Cumulative Preferred Stock of the
Borrower described in the Borrower’s Amended and Restated Charter.



     “Series B Preferred Stock” means the Series B Cumulative Convertible Preferred Stock
of the Borrower described in the Borrower’s Amended and Restated Charter.



26









 





     “Solvent” means, as to the Borrower and its Restricted Subsidiaries on a particular
date, that any such Person (a) has capital sufficient to carry on its business and transactions and
all business and transactions in which it is about to engage and is able to pay its debts as they
mature, (b) has assets having a value, both at fair valuation and at present fair saleable value,
greater than the amount required to pay its probable liabilities (including contingencies), and (c)
does not believe that it will incur debts or liabilities beyond its ability to pay such debts or
liabilities as they mature.



     “Stated Maturity” means, with respect to any installment of interest or principal on
any Indebtedness, the date on which such payment of interest or principal was scheduled to be paid
in the original documentation governing such Indebtedness, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.



     “Subordinated Indebtedness” means the collective reference to any Indebtedness of the
Borrower or any Restricted Subsidiary subordinated in right and time of payment to the Obligations
and containing such other terms and conditions, in each case as are satisfactory to the Required
Lenders.



     “Subsidiary” means as to any Person, any corporation, partnership, limited liability
company or other entity of which more than fifty percent (50%) of the outstanding Capital Stock
having ordinary voting power to elect a majority of the board of directors or other managers of
such corporation, partnership, limited liability company or other entity is at the time owned by,
or the management of which is otherwise controlled by, such Person (irrespective of whether, at the
time, Capital Stock of any other class or classes of such corporation, partnership, limited
liability company or other entity shall have or might have voting power by reason of the happening
of any contingency). Unless otherwise qualified references to “Subsidiary” or “Subsidiaries”
herein shall refer to those of the Borrower.



     “Subsidiary Guarantors” means each direct or indirect Domestic Subsidiary that is a
Restricted Subsidiary in existence on the Closing Date or that becomes a party to the Subsidiary
Guaranty Agreement pursuant to Section 8.11.



     “Subsidiary Guaranty Agreement” means the unconditional guaranty agreement of even
date herewith executed by the Subsidiary Guarantors in favor of the Administrative Agent for the
ratable benefit of itself and the Lenders, substantially in the form of Exhibit H, as amended,
restated, supplemented or otherwise modified from time to time.



     “Swingline Commitment” means the lesser of (a) Twenty Million Dollars ($20,000,000)
and (b) the Revolving Credit Commitment.



     “Swingline Facility” means the swingline facility established pursuant to Section
2.2.



     “Swingline Lender” means Bank of America in its capacity as swingline lender
hereunder.



27









 





     “Swingline Loan” means any swingline loan made by the Swingline Lender to the Borrower
pursuant to Section 2.2, and all such swingline loans collectively as the context requires.



     “Swingline Note” means a promissory note made by the Borrower in favor of the
Swingline Lender evidencing the Swingline Loans made by the Swingline Lender, substantially in the
form of Exhibit A-2, and any amendments, supplements and modifications thereto, any substitutes
therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.



     “Swingline Termination Date” means the first to occur of (a) the resignation of Bank
of America as Administrative Agent in accordance with Section 12.6 and (b) the Revolving
Credit Termination Date.



     “Synthetic Lease” means any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing product where such transaction is
considered borrowed money indebtedness for tax purposes but is classified as an Operating Lease in
accordance with GAAP.



     “Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental Authority with respect
to this Agreement, any of the other Loan Documents or the transactions that are the subject
thereof, including any interest, additions to tax or penalties applicable thereto.



     “Termination Event” except for any such event or condition that could not reasonably
be expected to have a Material Adverse Effect: (a) a “Reportable Event” described in Section 4043
of ERISA for which the notice requirement has not been waived by the PBGC, or (b) the withdrawal of
the Borrower or any ERISA Affiliate from a Pension Plan during a plan year in which it was a
“substantial employer” as defined in Section 4001(a)(2) of ERISA, or (c) the termination of a
Pension Plan, the filing of a notice of intent to terminate a Pension Plan or the treatment of a
Pension Plan amendment as a termination, under Section 4041 of ERISA, if the plan assets are not
sufficient to pay all plan liabilities, or (d) the institution of proceedings to terminate, or the
appointment of a trustee with respect to, any Pension Plan by the PBGC, or (e) any other event or
condition which would constitute grounds under Section 4042(a) of ERISA for the termination of, or
the appointment of a trustee to administer, any Pension Plan, or (f) the imposition of a Lien
pursuant to Section 412 of the Code or Section 302 of ERISA, or (g) the partial or complete
withdrawal of the Borrower of any ERISA Affiliate from a Multiemployer Plan if withdrawal liability
is asserted by such plan, or (h) any event or condition which results in the reorganization or
insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA, or (i) any event or
condition which results in the termination of a Multiemployer Plan under Section 4041A of ERISA or
the institution by PBGC of proceedings to terminate a Multiemployer Plan under Section 4042 of
ERISA.



     “Termination Value” means, in respect of any one or more Hedging Agreements, after
taking into account the effect of any legally enforceable netting agreement relating to such
Hedging Agreements, (a) for any date on or after the date such Hedging Agreements have been closed
out and termination value(s) determined in accordance therewith, such termination



28









 







value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s)
determined as the mark-to-market value(s) for such Hedging Agreements, as determined based upon one
or more mid-market or other readily available quotations provided by any recognized dealer in such
Hedging Agreements (which may include a Lender or any Affiliate of a Lender).



     “UCC” means the Uniform Commercial Code as in effect in the State of New York, as
amended or modified from time to time.



     “United States” means the United States of America.



     “Unoccupied Prison Facility” means any Prison Facility owned by the Borrower or its
Restricted Subsidiaries that, for the twelve-month period ending on the date of measurement, has
had an average occupancy level of less than fifteen percent (15%).



     “Unrestricted Subsidiary” means any Subsidiary of the Borrower that is designated by
the board of directors of the Borrower as an Unrestricted Subsidiary pursuant to Section
8.12, but only to the extent that such Subsidiary:



     (a) has no Indebtedness that is recourse (directly or indirectly) to the Borrower or any of
its Restricted Subsidiaries;



     (b) is not party to any agreement, contract, arrangement or understanding with the Borrower or
any of its Restricted Subsidiaries unless the terms of any such agreement, contract, arrangement or
understanding are no less favorable to the Borrower or such Restricted Subsidiary than those that
might be obtained at the time from Persons who are not Affiliates of the Borrower;



     (c) is a Person with respect to which neither the Borrower nor any of its Restricted
Subsidiaries has any direct or indirect obligation (i) to subscribe for additional Capital Stock or
(ii) to maintain or preserve such Person’s financial condition or to cause such Person to achieve
any specified levels of operating results; and



     (d) has not guaranteed or otherwise directly or indirectly provided credit support for any
Indebtedness of the Borrower or any of its Restricted Subsidiaries.



     “WCM” means Wachovia Capital Markets, LLC, and its successors.



     SECTION 1.2 Other Definitions and Provisions. With reference to this Agreement and
each other Loan Document, unless otherwise specified herein or in such other Loan Document: (a)
the definitions of terms herein shall apply equally to the singular and plural forms of the terms
defined, (b) whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms, (c) the words “include”, “includes” and “including” shall be
deemed to be followed by the phrase “without limitation”, (d) the word “will” shall be construed to
have the same meaning and effect as the word “shall”, (e) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring to such agreement,
instrument or other document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications set forth herein),
(f) any reference herein to any Person shall be



29









 







construed to include such Person’s successors and assigns, (g) the words “herein”, “hereof”
and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its
entirety and not to any particular provision hereof, (h) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and
Exhibits and Schedules to, this Agreement, (i) 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, (j) the term “documents”
includes any and all instruments, documents, agreements, certificates, notices, reports, financial
statements and other writings, however evidenced, whether in physical or electronic form, (k) in
the computation of periods of time from a specified date to a later specified date, the word “from”
means “from and including” the words “to” and “until” each mean “to but excluding” and the word
“through” means “to and including”, and (l) Section headings herein and in the other Loan Documents
are included for convenience of reference only and shall not affect the interpretation of this
Agreement or any other Loan Document.



     SECTION 1.3 Accounting Terms. All accounting terms not specifically or completely
defined herein shall be construed in conformity with, and all financial data (including financial
ratios and other financial calculations) required to be submitted pursuant to this Agreement shall
be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time,
applied in a manner consistent with that used in preparing the audited financial statements
required by Section 7.1(b), except as otherwise specifically prescribed herein.



     SECTION 1.4 UCC Terms. Terms defined in the UCC in effect on the Closing Date and not
otherwise defined herein shall, unless the context otherwise indicates, have the meanings provided
by those definitions. Subject to the foregoing, the term “UCC” refers, as of any date of
determination, to the UCC then in effect.



     SECTION 1.5 Rounding. Any financial ratios required to be maintained by the Borrower
pursuant to this Agreement shall be calculated by dividing the appropriate component by the other
component, carrying the result to one place more than the number of places by which such ratio is
expressed herein and rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).



     SECTION 1.6 References to Agreement and Laws. Unless otherwise expressly provided
herein, (a) references to formation documents, governing documents, agreements (including the Loan
Documents) and other contractual instruments shall be deemed to include all subsequent amendments,
restatements, extensions, supplements and other modifications thereto, but only to the extent that
such amendments, restatements, extensions, supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Applicable Law shall include all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or interpreting such
Applicable Law.



     SECTION 1.7 Times of Day. Unless otherwise specified, all references herein to times
of day shall be references to Eastern time (daylight or standard, as applicable).



     SECTION 1.8 Letter of Credit Amounts. Unless otherwise specified, all references
herein to the amount of a Letter of Credit at any time shall be deemed to mean the maximum



30









 







face amount of such Letter of Credit after giving effect to all increases thereof contemplated
by such Letter of Credit or the Letter of Credit Application therefor, whether or not such maximum
face amount is in effect at such time.



     SECTION 1.9 Consolidation of Variable Interest Entities. All references herein to
Consolidated financial statements of the Borrower and its Subsidiaries or to the determination of
any amount for the Borrower and its Subsidiaries on a consolidated basis or any similar reference
shall, in each case, be deemed to include each variable interest entity that the Borrower is
required to consolidate pursuant to FASB Interpretation No. 46 — Consolidation of Variable
Interest Entities: an interpretation of ARB No. 51 (January 2003) as if such variable interest
entity were a Subsidiary as defined herein.



ARTICLE II




REVOLVING CREDIT FACILITY




     SECTION 2.1 Revolving Credit Loans. Subject to the terms and conditions of this
Agreement, and in reliance upon the representations and warranties set forth herein, each Revolving
Credit Lender severally agrees to make Revolving Credit Loans to the Borrower from time to time
from the Closing Date through, but not including, the Revolving Credit Maturity Date as requested
by the Borrower in accordance with the terms of Section 2.3; provided, that (a) the
aggregate principal amount of all outstanding Revolving Credit Loans (after giving effect to any
amount requested) shall not exceed the Revolving Credit Commitment less the sum of all
outstanding Swingline Loans and L/C Obligations and (b) the principal amount of outstanding
Revolving Credit Loans from any Revolving Credit Lender to the Borrower shall not at any time
exceed such Revolving Credit Lender’s Revolving Credit Commitment less such Revolving
Credit Lender’s Revolving Credit Commitment Percentage of outstanding L/C Obligations and
outstanding Swingline Loans. Each Revolving Credit Loan by a Revolving Credit Lender shall be in a
principal amount equal to such Revolving Credit Lender’s Revolving Credit Commitment Percentage of
the aggregate principal amount of Revolving Credit Loans requested on such occasion. Subject to
the terms and conditions hereof, the Borrower may borrow, repay and reborrow Revolving Credit Loans
hereunder until the Revolving Credit Maturity Date.



     SECTION 2.2 Swingline Loans.



     (a) Availability. Subject to the terms and conditions of this Agreement, the
Swingline Lender agrees to make Swingline Loans to the Borrower from time to time from the Closing
Date through, but not including, the Swingline Termination Date; provided, that the
aggregate principal amount of all outstanding Swingline Loans (after giving effect to any amount
requested), shall not exceed the lesser of (i) the Revolving Credit Commitment less the sum of all
outstanding Revolving Credit Loans and the L/C Obligations and (ii) the Swingline Commitment.



     (b) Refunding.



          (i) Swingline Loans shall be refunded by the Revolving Credit Lenders on demand by the
Swingline Lender. Such refundings shall be made by the Revolving Credit




31









 







Lenders in accordance with their respective Revolving Credit Commitment Percentages and shall
thereafter be reflected as Revolving Credit Loans of the Revolving Credit Lenders on the books and
records of the Administrative Agent. Each Revolving Credit Lender shall fund its respective
Revolving Credit Commitment Percentage of Revolving Credit Loans as required to repay Swingline
Loans outstanding to the Swingline Lender upon demand by the Swingline Lender but in no event later
than 2:00 p.m. on the next succeeding Business Day after such demand is made. No Revolving Credit
Lender’s obligation to fund its respective Revolving Credit Commitment Percentage of a Swingline
Loan shall be affected by any other Revolving Credit Lender’s failure to fund its Revolving Credit
Commitment Percentage of a Swingline Loan, nor shall any Revolving Credit Lender’s Revolving Credit
Commitment Percentage be increased as a result of any such failure of any other Revolving Credit
Lender to fund its Revolving Credit Commitment Percentage of a Swingline Loan.




          (ii) The Borrower shall pay to the Swingline Lender on demand the amount of such Swingline
Loans to the extent amounts received from the Revolving Credit Lenders are not sufficient to repay
in full the outstanding Swingline Loans requested or required to be refunded. In addition, the
Borrower hereby authorizes the Administrative Agent to charge any account maintained by the
Borrower with the Swingline Lender (up to the amount available therein) in order to immediately pay
the Swingline Lender the amount of such Swingline Loans to the extent amounts received from the
Revolving Credit Lenders are not sufficient to repay in full the outstanding Swingline Loans
requested or required to be refunded. If any portion of any such amount paid to the Swingline
Lender shall be recovered by or on behalf of the Borrower from the Swingline Lender in bankruptcy
or otherwise, the loss of the amount so recovered shall be ratably shared among all the Revolving
Credit Lenders in accordance with their respective Revolving Credit Commitment Percentages (unless
the amounts so recovered by or on behalf of the Borrower pertain to a Swingline Loan extended after
the occurrence and during the continuance of an Event of Default of which the Administrative Agent
has received notice in the manner required pursuant to Section 12.3 and which Event of
Default has not been waived by the Required Lenders or the Lenders, as applicable).




          (iii) Each Revolving Credit Lender acknowledges and agrees that its obligation to refund
Swingline Loans in accordance with the terms of this Section is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including, without limitation,
non-satisfaction of the conditions set forth in Article V. Further, each Revolving Credit
Lender agrees and acknowledges that if prior to the refunding of any outstanding Swingline Loans
pursuant to this Section, one of the events described in Section 11.1(i) or (j)
shall have occurred, each Revolving Credit Lender will, on the date the applicable Revolving Credit
Loan would have been made, purchase an undivided participating interest in the Swingline Loan to be
refunded in an amount equal to its Revolving Credit Commitment Percentage of the aggregate amount
of such Swingline Loan. Each Revolving Credit Lender will immediately transfer to the Swingline
Lender, in immediately available funds, the amount of its participation and upon receipt thereof
the Swingline Lender will deliver to such Revolving Credit Lender a certificate evidencing such
participation dated the date of receipt of such funds and for such amount. Whenever, at any time
after the Swingline Lender has received from any Revolving Credit Lender such Revolving Credit
Lender’s participating interest in a Swingline Loan, the Swingline Lender receives any payment on
account thereof, the Swingline Lender will distribute to such Revolving Credit Lender its
participating interest in such amount




32









 







(appropriately adjusted, in the case of interest payments, to reflect the period of time
during which such Revolving Credit Lender’s participating interest was outstanding and funded).




     SECTION 2.3 Procedure for Advances of Revolving Credit Loans and Swingline Loans.



     (a) Requests for Borrowing. The Borrower shall give the Administrative Agent
irrevocable prior written notice substantially in the form of Exhibit B (a “Notice of
Borrowing”) not later than 12:00 noon (i) on the same Business Day as each Base Rate Loan and
each Swingline Loan and (ii) at least three (3) Business Days before each LIBOR Rate Loan, of its
intention to borrow, specifying (A) the date of such borrowing, which shall be a Business Day, (B)
the amount of such borrowing, which shall be, (x) with respect to Base Rate Loans (other than
Swingline Loans) in an aggregate principal amount of $2,000,000 or a whole multiple of $1,000,000
in excess thereof, (y) with respect to LIBOR Rate Loans in an aggregate principal amount of
$3,000,000 or a whole multiple of $1,000,000 in excess thereof and (z) with respect to Swingline
Loans in whole multiples of $100,000, (C) whether such Loans are to be Revolving Credit Loans or
Swingline Loans, (D) in the case of Revolving Credit Loans whether the Loans are to be LIBOR Rate
Loans or Base Rate Loans, and (E) in the case of LIBOR Rate Loans, the duration of the Interest
Period applicable thereto. A Notice of Borrowing received after 12:00 noon shall be deemed
received on the next Business Day. The Administrative Agent shall promptly notify the Lenders of
each Notice of Borrowing.



     (b) Disbursement of Revolving Credit and Swingline Loans. Not later than 2:00 p.m. on
the proposed borrowing date, (i) each Lender will make available to the Administrative Agent, for
the account of the Borrower, at the office of the Administrative Agent, in funds immediately
available to the Administrative Agent, such Lender’s Revolving Credit Commitment Percentage of the
Revolving Credit Loans to be made on such borrowing date and (ii) the Swingline Lender will make
available to the Administrative Agent, for the account of the Borrower, at the office of the
Administrative Agent, in funds immediately available to the Administrative Agent, the Swingline
Loans to be made on such borrowing date. The Borrower hereby irrevocably authorizes the
Administrative Agent to disburse the proceeds of each borrowing requested pursuant to this Section
in immediately available funds by crediting or wiring such proceeds to the deposit account of the
Borrower identified in the most recent notice substantially in the form of Exhibit C (a “Notice
of Account Designation”) delivered by the Borrower to the Administrative Agent, or as may be
otherwise agreed upon by the Borrower and the Administrative Agent from time to time. Subject to
Section 4.7 hereof, the Administrative Agent shall not be obligated to disburse the portion
of the proceeds of any Revolving Credit Loan requested pursuant to this Section to the extent that
any Lender has not made available to the Administrative Agent its Revolving Credit Commitment
Percentage of such Loan. Revolving Credit Loans to be made for the purpose of refunding Swingline
Loans shall be made by the Revolving Credit Lenders as provided in Section 2.2(b).



     SECTION 2.4 Repayment and Prepayment of Revolving Credit and Swingline Loans.



     (a) Repayment on Termination Date. The Borrower hereby agrees to repay the
outstanding principal amount of (i) all Revolving Credit Loans in full on the Revolving Credit
Maturity Date, and (ii) all Swingline Loans in accordance with Section 2.2(b), together, in
each case, with all accrued but unpaid interest thereon.




33












 





     (b) Mandatory Prepayments. If at any time the outstanding principal amount of all
Revolving Credit Loans plus the sum of all outstanding Swingline Loans and L/C Obligations exceeds
the Revolving Credit Commitment, the Borrower agrees to repay immediately upon notice from the
Administrative Agent, by payment to the Administrative Agent for the account of the Lenders,
Extensions of Credit in an amount equal to such excess with each such repayment applied
first to the principal amount of outstanding Swingline Loans, second to the
principal amount of outstanding Revolving Credit Loans and third, with respect to any
Letters of Credit then outstanding, a payment of cash collateral into a cash collateral account
opened by the Administrative Agent, for the benefit of the Lenders, in an amount equal to the
aggregate then undrawn and unexpired amount of such Letters of Credit (such cash collateral to be
applied in accordance with Section 11.4). The application of any prepayment of Revolving
Credit Loans pursuant to this Section 2.4(b) shall be made, first, to Base Rate Loans and,
second, to LIBOR Rate Loans.



     (c) Optional Prepayments. The Borrower may at any time and from time to time prepay
Revolving Credit Loans and Swingline Loans, in whole or in part, with irrevocable prior written
notice to the Administrative Agent substantially in the form of Exhibit D (a “Notice of
Prepayment”) given not later than 12:00 noon (i) on the same Business Day as each Base Rate
Loan and each Swingline Loan and (ii) at least three (3) Business Days before each LIBOR Rate Loan,
specifying the date and amount of prepayment and whether the prepayment is of LIBOR Rate Loans,
Base Rate Loans, Swingline Loans or a combination thereof, and, if of a combination thereof, the
amount allocable to each. Upon receipt of such notice, the Administrative Agent shall promptly
notify each Lender. If any such notice is given, the amount specified in such notice shall be due
and payable on the date set forth in such notice. Partial prepayments shall be in an aggregate
amount of $2,000,000 or a whole multiple of $1,000,000 in excess thereof with respect to Base Rate
Loans (other than Swingline Loans), $3,000,000 or a whole multiple of $1,000,000 in excess thereof
with respect to LIBOR Rate Loans and $100,000 or a whole multiple of $100,000 in excess thereof
with respect to Swingline Loans. A Notice of Prepayment received after 12:00 noon shall be deemed
received on the next Business Day. Each such repayment shall be accompanied by any amount required
to be paid pursuant to Section 4.9 hereof.



     (d) Limitation on Prepayment of LIBOR Rate Loans. The Borrower may not prepay any
LIBOR Rate Loan on any day other than on the last day of the Interest Period applicable thereto
unless such prepayment is accompanied by any amount required to be paid pursuant to Section
4.9 hereof.



     (e) Hedging Agreements. No repayment or prepayment pursuant to this Section shall
affect any of the Borrower’s obligations under any Hedging Agreement.



     SECTION 2.5 Permanent Reduction of the Revolving Credit Commitment.



     (a) Voluntary Reduction. The Borrower shall have the right at any time and from time
to time, upon at least five (5) Business Days’ prior written notice to the Administrative Agent, to
permanently reduce, without premium or penalty, (i) the entire Revolving Credit Commitment at any
time or (ii) portions of the Revolving Credit Commitment, from time to time, in an aggregate
principal amount not less than $5,000,000 or any whole multiple of



34









 







$1,000,000 in excess thereof. Any reduction of the Revolving Credit Commitment shall be
applied to the Revolving Credit Commitment of each Revolving Credit Lender according to its
Revolving Credit Commitment Percentage. All commitment fees accrued until the effective date of
any termination of the Revolving Credit Commitment shall be paid on the effective date of such
termination.



     (b) Corresponding Payment. Each permanent reduction permitted or required pursuant to
this Section shall be accompanied by a payment of principal sufficient to reduce the aggregate
Revolving Credit Loans, Swingline Loans and L/C Obligations, as applicable, outstanding after such
reduction to the Revolving Credit Commitment as so reduced, and if the Revolving Credit Commitment
as so reduced is less than the aggregate amount of all outstanding Letters of Credit, the Borrower
shall be required to deposit cash collateral in a cash collateral account opened by the
Administrative Agent in an amount equal to the aggregate then undrawn and unexpired amount of such
Letters of Credit. Such cash collateral shall be applied in accordance with Section 11.4.
Any reduction of the Revolving Credit Commitment to zero shall be accompanied by payment of all
outstanding Revolving Credit Loans and Swingline Loans (and furnishing of cash collateral
satisfactory to the Administrative Agent for all L/C Obligations) and shall result in the
termination of the Revolving Credit Commitment and the Swingline Commitment and the Revolving
Credit Facility. Such cash collateral shall be applied in accordance with Section 11.4.
If the reduction of the Revolving Credit Commitment requires the repayment of any LIBOR Rate Loan,
such repayment shall be accompanied by any amount required to be paid pursuant to Section
4.9 hereof.



     SECTION 2.6 Termination of Revolving Credit Facility. The Revolving Credit Facility
shall terminate on the Revolving Credit Maturity Date.



     SECTION 2.7 Increase in Revolving Credit Facility.



     (a) As an alternative or in addition to Section 2.8 below, subject to the conditions
set forth below, at any time prior to the Revolving Credit Maturity Date, the Borrower shall have
the right to request, upon not less than thirty (30) days’ prior written notice (an
“Incremental Revolving Credit Commitment Notification”) to the Administrative Agent, an
increase in the Revolving Credit Commitment in an aggregate principal amount as may be specified by
the Borrower. Such Incremental Revolving Credit Commitment Notification shall specify the
applicable Incremental Revolving Credit Commitment Effective Date.



     (b) Increases in the Revolving Credit Commitment pursuant to this Section 2.7 shall be
obtained from existing Lenders or from other banks, financial institutions or investment funds that
qualify as Eligible Assignees (each such other bank, financial institution or investment fund, a
“New Revolving Lender” and, collectively with the existing Lenders providing a portion of
the proposed increase in the Revolving Credit Commitment pursuant to this Section 2.7, the
“Incremental Revolving Credit Lenders”); provided that no existing Lender shall
have any obligation to increase its Revolving Credit Commitment pursuant to this Section
2.7 and the failure by any existing Lender to respond to a request for such increase shall be
deemed to be a refusal of such request by such existing Lender.



35









 





     (c) The following terms and conditions shall apply to each increase in the Revolving Credit
Commitment pursuant to this Section 2.7:



          (i) such increase in the Revolving Credit Commitment pursuant to this Section 2.7 (and
any Revolving Credit Loans made thereunder) shall constitute Obligations of the Borrower and shall
be secured and guaranteed with the other Extensions of Credit on a pari passu
basis;




          (ii) the Administrative Agent and the Lenders shall have received from the Borrower an
Officer’s Compliance Certificate, in form and substance reasonably satisfactory to the
Administrative Agent, demonstrating that, as of the applicable Incremental Revolving Credit
Commitment Effective Date and after giving effect thereto and any Extensions of Credit made or to
be made in connection therewith, the Borrower and its Restricted Subsidiaries are in pro
forma compliance with the financial covenants set forth in Article IX;




          (iii) no Default or Event of Default shall have occurred and be continuing as of the
applicable Incremental Revolving Credit Commitment Effective Date or after giving effect to such
increase in the Revolving Credit Commitment pursuant to this Section 2.7;




          (iv) the representations and warranties made by each Credit Party in this Agreement and the
other Loan Documents shall be true and correct on and as of the applicable Incremental Revolving
Credit Commitment Effective Date with the same effect as if made on and as of such date (other than
those representations and warranties that by their terms speak as of a particular date, which
representations and warranties shall be true and correct as of such particular date);




          (v) the Administrative Agent shall have received a resolution duly adopted by the board of
directors of each Credit Party authorizing such increase in the Revolving Credit Commitment
pursuant to this Section 2.7;




          (vi) in no event shall the aggregate amount of all increases in the Revolving Credit
Commitment pursuant to this Section 2.7 (including the requested increase) plus the
aggregate amount of all Incremental Term Loans made pursuant to Section 2.8, exceed
$300,000,000;




          (vii) the amount of such increase in the Revolving Credit Commitment pursuant to this
Section 2.7 shall not be less than a minimum principal amount of $15,000,000, or, if less,
the remaining amount permitted pursuant to clause (vii) above;




          (viii) the Borrower and each Incremental Revolving Credit Lender shall execute and deliver a
Lender Addition and Acknowledgement Agreement to the Administrative Agent for its acceptance and
recording in the Register, which shall be acknowledged by the Administrative Agent and each
Subsidiary Guarantor and shall be in form and substance reasonably satisfactory to the
Administrative Agent;




          (ix) the Administrative Agent shall have received any documents or information in connection
with such increase in the Revolving Credit Commitment pursuant to this Section 2.7 as it
may request in its reasonable discretion; and




36









 








          (x) the outstanding Revolving Credit Loans and Revolving Credit Commitment Percentages of L/C
Obligations will be reallocated by the Administrative Agent on the applicable Incremental Revolving
Credit Commitment Effective Date among the Lenders in accordance with their revised Revolving
Credit Commitment Percentages (and the Lenders agree to make all payments and adjustments necessary
to effect such reallocation and the Borrower shall pay any and all costs required pursuant to
Section 4.9 in connection with such reallocation as if such reallocation were a repayment).




     (d) Notwithstanding the provisions of Section 13.2 to the contrary, the Administrative
Agent is hereby authorized to execute and deliver amendment documentation evidencing such
amendments (or any other amendments necessary to effectuate the proposed increase in the Revolving
Credit Commitment pursuant to this Section 2.7 on the terms set forth above) on behalf of
the Lenders; provided that such amendment shall not modify this Agreement or any other Loan
Document in any manner materially adverse to any Lender without the consent of such Lenders
adversely affected thereby in accordance with Section 13.2 hereof.



     (e) Upon the execution, delivery, acceptance and recording of the applicable Lender Addition
and Acknowledgment Agreement, from and after the applicable Incremental Revolving Credit Commitment
Effective Date, (i) each Incremental Revolving Credit Lender shall have a Revolving Credit
Commitment as set forth in the Register and all the rights and obligations of a Lender with a
Revolving Credit Commitment hereunder and (ii) all Revolving Credit Loans made on account of any
increase in the Revolving Credit Commitment pursuant to this Section 2.7 shall bear
interest at the rate applicable to the Revolving Credit Loans immediately prior to giving effect to
such increase in the Revolving Credit Commitment pursuant to this Section 2.7.



     (f) The Administrative Agent shall maintain a copy of each Lender Addition and Acknowledgment
Agreement delivered to it in accordance with Section 13.10(c).



     SECTION 2.8 Incremental Term Loans.



     (a) As an alternative or in addition to Section 2.7 above, subject to the conditions
set forth in paragraphs (a) through (f) hereof, at any time prior to the Revolving Credit Maturity
Date, the Borrower, shall have the right to request, upon not less than thirty (30) days’ prior
written notice (an “Incremental Term Loan Notification”) to the Administrative Agent,
Incremental Term Loans in an aggregate principal amount as may be specified by the Borrower. Such
Incremental Term Loan Notification shall specify the applicable Incremental Term Loan Effective
Date, and on such date, the Borrower shall deliver a Notice of Borrowing with respect to such
Incremental Term Loan. The Borrower shall not deliver more than two (2) Incremental Term Loan
Notifications during the term of this Agreement.



     (b) Each Incremental Term Loan shall be obtained from existing Lenders or from other banks,
financial institutions or investment funds that qualify as Eligible Assignees (each such other
bank, financial institution or investment fund, a “New Incremental Term Loan Lender” and,
collectively with the existing Lenders providing such Incremental Term Loan, the “Incremental
Term Loan Lenders”); provided that no existing Lender shall have any obligation to
provide any portion of such Incremental Term Loan and the failure by any existing Lender to



37









 







respond to a request for an Incremental Term Loan shall be deemed to be a refusal of such
request by such existing Lender.



     (c) The following terms and conditions shall apply to each Incremental Term Loan:



          (i) such Incremental Term Loan shall constitute Obligations of the Borrower and shall be
secured and guaranteed with the other Extensions of Credit on a pari passu basis;




          (ii) the Administrative Agent and the Lenders shall have received from the Borrower an
Officer’s Compliance Certificate, in form and substance reasonably satisfactory to the
Administrative Agent, demonstrating that, as of the applicable Incremental Term Loan Effective Date
and after giving effect thereto and any Extensions of Credit made or to be made in connection
therewith, the Borrower and its Restricted Subsidiaries are in pro forma compliance
with the financial covenants set forth in Article IX;




          (iii) no Default or Event of Default shall have occurred and be continuing as of the
applicable Incremental Term Loan Effective Date or after giving effect to the making of any such
Incremental Term Loan;




          (iv) the representations and warranties made by each Credit Party in this Agreement and the
other Loan Documents shall be true and correct on and as of the applicable Incremental Term Loan
Effective Date with the same effect as if made on and as of such date (other than those
representations and warranties that by their terms speak as of a particular date, which
representations and warranties shall be true and correct as of such particular date);




          (v) the Administrative Agent shall have received a resolution duly adopted by the board of
directors of each Credit Party authorizing such Incremental Term Loan;




          (vi) each Incremental Term Loan will mature and amortize in a manner reasonably acceptable to
the Administrative Agent and the Incremental Term Loan Lenders making such Incremental Term Loan,
but will not in any event have a maturity date earlier than the Revolving Credit Maturity Date;




          (vii) in no event shall the aggregate principal amount of all Incremental Term Loans made
pursuant to this Section 2.8 (including the requested Incremental Term Loan) plus
the aggregate amount of all increases in the Revolving Credit Commitment pursuant to Section
2.7, exceed $300,000,000;




          (viii) the amount of such Incremental Term Loan obtained hereunder shall not be less than a
minimum principal amount of $15,000,000, or, if less, the remaining amount permitted pursuant to
clause (vi) above;




          (ix) the Borrower and each Incremental Term Loan Lender shall execute and deliver an
Incremental Term Loan Agreement to the Administrative Agent, for its acceptance and recording in
the Register, which shall be acknowledged by the Administrative Agent and each Subsidiary Guarantor
and shall be in form and substance reasonably satisfactory to the Administrative Agent; and




38









 








          (x) the Administrative Agent shall have received any documents or information in connection
with such Incremental Term Loan as it may request in its reasonable discretion.




     (d) Notwithstanding the provisions of Section 13.2 to the contrary, the Administrative
Agent is hereby authorized to execute and deliver amendment documentation evidencing such
amendments (or any other amendments necessary to effectuate the Incremental Term Loan on the terms
set forth above) on behalf of the Lenders; provided that such amendment shall not modify
this Agreement or any other Loan Document in any manner materially adverse to any Lender without
the consent of such Lenders adversely affected thereby in accordance with Section 13.2
hereof.



     (e) Upon the execution, delivery, acceptance and recording of the applicable Incremental Term
Loan Agreement, from and after the applicable Incremental Term Loan Effective Date, each
Incremental Term Loan Lender shall have an Incremental Term Loan Commitment as set forth in the
Register and all the rights and obligations of a Lender with such an Incremental Term Loan
Commitment hereunder. The applicable Incremental Term Loan Lenders shall make the Incremental Term
Loan to the Borrower on the applicable Incremental Term Loan Effective Date in an amount equal to
the Incremental Term Loan Commitment of each Incremental Term Loan Lender with respect to such
Incremental Term Loan as agreed upon pursuant to subsection (b) above.



     (f) The Administrative Agent shall maintain a copy of each Incremental Term Loan Agreement
delivered to it in accordance with Section 13.10(c).



ARTICLE III




LETTER OF CREDIT FACILITY




     SECTION 3.1 L/C Commitment. Subject to the terms and conditions hereof, each Issuing
Lender, in reliance on the agreements of the other Lenders set forth in Section 3.4(a),
agrees to issue standby letters of credit (“Letters of Credit”) for the account of the
Borrower on any Business Day from the Closing Date through but not including the Revolving Credit
Maturity Date in such form as may be approved from time to time by the applicable Issuing Lender;
provided, that no Issuing Lender shall have any obligation to issue any Letter of Credit
if, after giving effect to such issuance, the Administrative Agent has determined that (a) the L/C
Obligations would exceed the L/C Commitment or (b) the aggregate principal amount of outstanding
Revolving Credit Loans, plus the aggregate principal amount of outstanding Swingline Loans,
plus the aggregate amount of L/C Obligations would exceed the Revolving Credit Commitment.
Each Letter of Credit shall (i) be denominated in Dollars in a minimum amount of $100,000 (other
than Existing Letters of Credit or as otherwise agreed to by the applicable Issuing Lender and the
Administrative Agent), (ii) be a standby letter of credit issued to support obligations of the
Borrower or any of its Restricted Subsidiaries, contingent or otherwise, incurred in the ordinary
course of business, (iii) expire on a date no more than twelve (12) months after the date of
issuance or last renewal of such Letter of Credit, which date shall be no later than the fifth
(5th) Business Day prior to the Revolving Credit Maturity Date and (iv) be subject to the ISP98, as
set forth in the Letter of Credit Application or as determined by the



39









 







applicable Issuing Lender and, to the extent not inconsistent therewith, the laws of the State
of New York. Notwithstanding the foregoing, each Issuing Lender agrees to issue Letters of Credit
with an expiration date later than the fifth (5th) Business Day prior to the Revolving Credit
Maturity Date (but no later than one year from the date of issuance thereof) in reliance upon the
agreement by the Borrower to cash collateralize such Letters of Credit in an amount equal to 105%
of the aggregate amount available to be drawn under such Letters of Credit by the date that is
thirty (30) days prior to the Revolving Credit Maturity Date, and the Borrower agrees so to cash
collateralize such Letters of Credit by such date, it being understood that, except with respect to
drawings made under such Letters of Credit prior to the date of receipt of such cash collateral by
the applicable Issuing Lender, the Administrative Agent and the Lenders (other than the applicable
Issuing Lender) shall, after the date of receipt of such cash collateral by the applicable Issuing
Lender, be released from any and all obligations to purchase participations or make Revolving
Credit Loans in respect of such Letters of Credit. As of the Closing Date, each of the Existing
Letters of Credit shall constitute, for all purposes of this Agreement and the other Loan
Documents, a Letter of Credit issued and outstanding hereunder. No Issuing Lender shall at any
time be obligated to issue any Letter of Credit hereunder if such issuance would violate, or cause
such Issuing Lender or any L/C Participant to exceed any limits imposed by, any Applicable Law.
References herein to “issue” and derivations thereof with respect to Letters of Credit shall also
include extensions or modifications of any outstanding Letters of Credit, unless the context
otherwise requires.



     SECTION 3.2 Procedure for Issuance of Letters of Credit. The Borrower may from time
to time request that an Issuing Lender issue a Letter of Credit by delivering to such Issuing
Lender and the Administrative Agent a Letter of Credit Application therefor, completed to the
satisfaction of such Issuing Lender, and such other certificates, documents and other papers and
information as such Issuing Lender may request. Upon receipt of any Letter of Credit Application,
the applicable Issuing Lender shall process such Letter of Credit Application and the certificates,
documents and other papers and information delivered to it in connection therewith in accordance
with its customary procedures and shall, subject to Section 3.1 and Article V,
promptly issue the Letter of Credit requested thereby (but in no event shall such Issuing Lender be
required to issue any Letter of Credit earlier than three (3) Business Days after its receipt of
the Letter of Credit Application therefor and all such other certificates, documents and other
papers and information relating thereto) by issuing the original of such Letter of Credit to the
beneficiary thereof or as otherwise may be agreed by such Issuing Lender and the Borrower. The
applicable Issuing Lender shall promptly furnish to the Borrower and the Administrative Agent a
copy of such Letter of Credit. Upon receipt of such Letter of Credit, the Administrative Agent
shall promptly notify each Lender of the issuance and upon request by any Lender, furnish to such
Lender a copy of such Letter of Credit and the amount of such Lender’s participation therein,
provided that the Administrative Agent shall be obligated to deliver the foregoing with
respect to a Letter of Credit issued by an Additional Issuing Lenders only after receipt by the
Administrative Agent of all notices required to be delivered to the Administrative Agent with
respect thereto.



     SECTION 3.3 Commissions and Other Charges.



     (a) Letter of Credit Commissions. The Borrower shall pay to the Administrative Agent,
for the account of the applicable Issuing Lender and the L/C Participants, a letter of credit



40









 







commission with respect to each Letter of Credit in an amount per annum equal to the face
amount of such Letter of Credit multiplied by the Applicable Margin with respect to
Revolving Credit Loans that are LIBOR Rate Loans (determined on a per annum basis). Such
commission shall be payable quarterly in arrears on the last Business Day of each calendar quarter,
on the Revolving Credit Maturity Date and thereafter on demand of the Administrative Agent. The
Administrative Agent shall, promptly following its receipt thereof, distribute to the applicable
Issuing Lender and the L/C Participants all commissions received pursuant to this Section in
accordance with their respective Revolving Credit Commitment Percentages.



     (b) Issuance Fee. In addition to the foregoing commission, for Letters of Credit
issued by Bank of America or Wachovia, the Borrower shall pay to the Administrative Agent, for the
account of the applicable Issuing Lender, an issuance fee with respect to each Letter of Credit in
an amount equal to the face amount of such Letter of Credit multiplied by one eighth of one percent
(0.125%) per annum. Such issuance fee shall be payable quarterly in arrears on the last Business
Day of each calendar quarter commencing with the first such date to occur after the issuance of
such Letter of Credit, on the Revolving Credit Maturity Date and thereafter on demand of the
Administrative Agent. For Letters of Credit issued by Additional Issuing Lenders, the Borrower
shall pay to the applicable Additional Issuing Lender such issuance fees as shall be agreed to by
the Borrower and such Additional Issuing Lender.



     (c) Other Costs. In addition to the foregoing fees and commissions, the Borrower
shall pay or reimburse the applicable Issuing Lender for such normal and customary costs and
expenses as are incurred or charged by such Issuing Lender in issuing, effecting payment under,
amending or otherwise administering any Letter of Credit.



     SECTION 3.4 L/C Participations.



     (a) The applicable Issuing Lender irrevocably agrees to grant and hereby grants to each L/C
Participant, and, to induce the applicable Issuing Lender to issue Letters of Credit hereunder,
each L/C Participant irrevocably agrees to accept and purchase and hereby accepts and purchases
from such Issuing Lender, on the terms and conditions hereinafter stated, for such L/C
Participant’s own account and risk, an undivided interest equal to such L/C Participant’s Revolving
Credit Commitment Percentage in such Issuing Lender’s obligations and rights under and in respect
of each Letter of Credit issued hereunder and the amount of each draft paid by such Issuing Lender
thereunder. Each L/C Participant unconditionally and irrevocably agrees with the applicable
Issuing Lender that, if a draft is paid under any Letter of Credit for which such Issuing Lender is
not reimbursed in full by the Borrower through a Revolving Credit Loan or otherwise in accordance
with the terms of this Agreement, such L/C Participant shall pay to such Issuing Lender upon demand
at such Issuing Lender’s address for notices specified herein an amount equal to such L/C
Participant’s Revolving Credit Commitment Percentage of the amount of such draft, or any part
thereof, which is not so reimbursed.



     (b) Upon becoming aware of any amount required to be paid by any L/C Participant to the
applicable Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion
of any payment made by such Issuing Lender under any Letter of Credit, such Issuing Lender shall
notify the Administrative Agent and each L/C Participant of the amount and due date of such
required payment and such L/C Participant shall pay to such Issuing Lender the



41









 







amount specified on the applicable due date. If any such amount is paid to the applicable
Issuing Lender after the date such payment is due, such L/C Participant shall pay to such Issuing
Lender on demand, in addition to such amount, the product of (i) such amount, times (ii)
the daily average Federal Funds Rate as determined by the Administrative Agent during the period
from and including the date such payment is due to the date on which such payment is immediately
available to such Issuing Lender, times (iii) a fraction the numerator of which is the
number of days that elapse during such period and the denominator of which is 360. A certificate
of the applicable Issuing Lender with respect to any amounts owing under this Section shall be
presumed correct in the absence of manifest error. With respect to payment to the applicable
Issuing Lender of the unreimbursed amounts described in this Section, if the L/C Participants
receive notice that any such payment is due (A) prior to 2:00 p.m. on any Business Day, such
payment shall be due that Business Day, and (B) after 2:00 p.m. on any Business Day, such payment
shall be due on the following Business Day.



     (c) Whenever, at any time after the applicable Issuing Lender has made payment under any
Letter of Credit and has received from any L/C Participant its Revolving Credit Commitment
Percentage of such payment in accordance with this Section, such Issuing Lender receives any
payment related to such Letter of Credit (whether directly from the Borrower or otherwise), or any
payment of interest on account thereof, such Issuing Lender will distribute to such L/C Participant
its pro rata share thereof; provided, that in the event that any such
payment received by such Issuing Lender shall be required to be returned by such Issuing Lender,
such L/C Participant shall return to such Issuing Lender the portion thereof previously distributed
by the Issuing Lender to it.



     SECTION 3.5 Reimbursement Obligation of the Borrower. In the event of any drawing
under any Letter of Credit, the Borrower agrees to reimburse (either with the proceeds of a
Revolving Credit Loan as provided for in this Section or with funds from other sources), in same
day funds, the applicable Issuing Lender on each date on which such Issuing Lender notifies the
Borrower of the date and amount of a draft paid under any Letter of Credit for the amount of (a)
such draft so paid and (b) any amounts referred to in Section 3.3(c) incurred by such
Issuing Lender in connection with such payment. Unless the Borrower shall immediately notify the
Administrative Agent and the applicable Issuing Lender that the Borrower intends to reimburse such
Issuing Lender for such drawing from other sources or funds, the Borrower shall be deemed to have
timely given a Notice of Borrowing to the Administrative Agent requesting that the Revolving Credit
Lenders make a Revolving Credit Loan bearing interest at the Base Rate on such date in the amount
of (a) such draft so paid and (b) any amounts referred to in Section 3.3(c) incurred by
such Issuing Lender in connection with such payment, and the Revolving Credit Lenders shall make a
Revolving Credit Loan bearing interest at the Base Rate in such amount, the proceeds of which shall
be applied to reimburse such Issuing Lender for the amount of the related drawing and costs and
expenses. Each Revolving Credit Lender acknowledges and agrees that its obligation to fund a
Revolving Credit Loan in accordance with this Section to reimburse the applicable Issuing Lender
for any draft paid under a Letter of Credit is absolute and unconditional and shall not be affected
by any circumstance whatsoever, including, without limitation, non-satisfaction of the conditions
set forth in Section 2.3(a) or Article V. If the Borrower has elected to pay the
amount of such drawing with funds from other sources and shall fail to reimburse the applicable
Issuing Lender as provided above, the unreimbursed amount of such drawing shall bear interest at
the rate which would be payable on any outstanding Base Rate



42









 







Loans which were then overdue from the date such amounts become payable (whether at stated
maturity, by acceleration or otherwise) until payment in full.



     SECTION 3.6 Obligations Absolute. The Borrower’s obligations under this Article
III (including, without limitation, any Reimbursement Obligation) shall be absolute and
unconditional under any and all circumstances and irrespective of any set-off, counterclaim or
defense to payment which the Borrower may have or have had against the applicable Issuing Lender or
any beneficiary of a Letter of Credit or any other Person. The Borrower also agrees that the
applicable Issuing Lender and the L/C Participants shall not be responsible for, and the Borrower’s
Reimbursement Obligation under Section 3.5 shall not be affected by, among other things,
the validity or genuineness of documents or of any endorsements thereon, even though such documents
shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among the
Borrower and any beneficiary of any Letter of Credit or any other party to which such Letter of
Credit may be transferred or any claims whatsoever of the Borrower against any beneficiary of such
Letter of Credit or any such transferee. The applicable Issuing Lender and the Administrative
Agent shall not be liable for any error, omission, interruption or delay in transmission, dispatch
or delivery of any message or advice, however transmitted, in connection with any Letter of Credit,
except for errors or omissions caused by such Issuing Lender’s or Administrative Agent’s gross
negligence or willful misconduct, as determined by a court of competent jurisdiction by final
nonappealable judgment. The Borrower agrees that any action taken or omitted by the applicable
Issuing Lender or the Administrative Agent under or in connection with any Letter of Credit or the
related drafts or documents, if done in the absence of gross negligence or willful misconduct shall
be binding on the Borrower and shall not result in any liability of such Issuing Lender, the
Administrative Agent or any L/C Participant to the Borrower. The responsibility of the applicable
Issuing Lender and the Administrative Agent to the Borrower in connection with any draft presented
for payment under any Letter of Credit shall, in addition to any payment obligation expressly
provided for in such Letter of Credit, be limited to determining that the documents (including each
draft) delivered under such Letter of Credit in connection with such presentment are in conformity
with such Letter of Credit.



     SECTION 3.7 Effect of Letter of Credit Application. To the extent that any provision
of any Letter of Credit Application related to any Letter of Credit is inconsistent with the
provisions of this Article III, the provisions of this Article III shall apply.



     SECTION 3.8 Appointment and Duties of Additional Issuing Lenders. The Borrower may
appoint Additional Issuing Lenders by delivering written notice to the Administrative Agent at
least two (2) Business Days before the issuance of any Letters of Credit by such Additional Issuing
Lenders. Any Revolving Credit Lender designated as an Additional Issuing Lender shall remain as
such until the Borrower gives written notice to the Administrative Agent that such Revolving Credit
Lender is no longer an Additional Issuing Lender; provided that no L/C Obligations remain
outstanding with respect to such Additional Issuing Lender. Each Additional Issuing Lender shall
notify the Administrative Agent at least two (2) Business Days before (i) the issuance of any
Letter of Credit by such Additional Issuing Lender and (ii) any amendment or modification to any
Letter of Credit issued by such Additional Issuing Lender.



43









 





ARTICLE IV




GENERAL LOAN PROVISIONS




     SECTION 4.1 Interest.



     (a) Interest Rate Options. Subject to the provisions of this Section, at the election
of the Borrower, (i) Revolving Credit Loans shall bear interest at (A) the Base Rate plus
the Applicable Margin or (B) the LIBOR Rate plus the Applicable Margin (provided
that the LIBOR Rate shall not be available until three (3) Business Days after the Closing Date)
and (ii) any Swingline Loan shall bear interest at the Base Rate plus the Applicable
Margin. The Borrower shall select the rate of interest and Interest Period, if any, applicable to
any Loan at the time a Notice of Borrowing is given or at the time a Notice of
Conversion/Continuation is given pursuant to Section 4.2. Any Loan or any portion thereof
as to which the Borrower has not duly specified an interest rate as provided herein shall be deemed
a Base Rate Loan.



     (b) Interest Periods. In connection with each LIBOR Rate Loan, the Borrower, by
giving notice at the times described in Section 2.3 or 4.2, as applicable, shall
elect an interest period (each, an “Interest Period”) to be applicable to such Loan, which
Interest Period shall be a period of one (1), two (2), three (3) or six (6) months;
provided that:



          (i) the Interest Period shall commence on the date of advance of or conversion to any LIBOR
Rate Loan and, in the case of immediately successive Interest Periods, each successive Interest
Period shall commence on the date on which the immediately preceding Interest Period expires;




          (ii) if any Interest Period would otherwise expire on a day that is not a Business Day, such
Interest Period shall expire on the next succeeding Business Day; provided, that if any
Interest Period with respect to a LIBOR Rate Loan would otherwise expire on a day that is not a
Business Day but is a day of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the immediately preceding Business Day;




          (iii) any Interest Period with respect to a LIBOR Rate Loan that begins on the last Business
Day of a calendar month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last Business Day of the
relevant calendar month at the end of such Interest Period;




          (iv) no Interest Period shall extend beyond the Revolving Credit Maturity Date; and




          (v) there shall be no more than six (6) Interest Periods in effect at any time.




     (c) Default Rate. Subject to Section 11.3, (i) immediately upon the
occurrence and during the continuance of an Event of Default under Section 11.1(a), (b),
(j) or (k), or (ii) at the election of the Required Lenders, upon the occurrence and
during the continuance of any other Event of Default, (A) the Borrower shall no longer have the
option to request LIBOR Rate Loans, Swingline Loans or Letters of Credit, (B) all outstanding such
LIBOR Rate Loans shall bear interest at a rate per annum of two percent (2%) in excess of the rate
then applicable to



44









 







LIBOR Rate Loans until the end of the applicable Interest Period and thereafter at a rate
equal to two percent (2%) in excess of the rate then applicable to Base Rate Loans, and (C) all
outstanding Base Rate Loans and other Obligations arising hereunder or under any other Loan
Document shall bear interest at a rate per annum equal to two percent (2%) in excess of the rate
then applicable to Base Rate Loans or such other Obligations arising hereunder or under any other
Loan Document. Interest shall continue to accrue on the Obligations after the filing by or against
the Borrower of any petition seeking any relief in bankruptcy or under any act or law pertaining to
insolvency or debtor relief, whether state, federal or foreign. Such interest shall be payable on
demand of the Administrative Agent.



     (d) Interest Payment and Computation. Interest on each Base Rate Loan shall be due
and payable in arrears on the last Business Day of each calendar quarter commencing March 31, 2008;
and interest on each LIBOR Rate Loan shall be due and payable on the last day of each Interest
Period applicable thereto, and if such Interest Period extends over three (3) months, at the end of
each three (3) month interval during such Interest Period. Interest on LIBOR Rate Loans and all
fees payable hereunder shall be computed on the basis of a 360-day year and assessed for the actual
number of days elapsed and interest on Base Rate Loans shall be computed on the basis of a
365/366-day year and assessed for the actual number of days elapsed.



     (e) Maximum Rate. In no contingency or event whatsoever shall the aggregate of all
amounts deemed interest or loan charges under this Agreement charged or collected pursuant to the
terms of this Agreement exceed the amount collectible at the highest rate permissible under any
Applicable Law that a court of competent jurisdiction shall, in a final determination, deem
applicable hereto. In the event that such a court determines that the Lenders have charged or
received interest or loan charges hereunder in excess of the amount collectible at the highest
permissible rate, the rate in effect hereunder shall automatically be reduced to the maximum rate
permitted by Applicable Law and the Lenders shall at the Administrative Agent’s option (i) promptly
refund to the Borrower any interest or loan charges received by the Lenders in excess of the amount
collectible at the maximum lawful rate or (ii) apply such excess to the principal balance of the
Obligations on a pro rata basis. It is the intent hereof that the Borrower not pay
or contract to pay, and that neither the Administrative Agent nor any Lender receive or contract to
receive, directly or indirectly in any manner whatsoever, interest or loan charges in excess of
those that may be paid by the Borrower under Applicable Law.



     SECTION 4.2 Notice and Manner of Conversion or Continuation of Loans. Provided that
no Default or Event of Default has occurred and is then continuing, the Borrower shall have the
option to (a) convert at any time following the third Business Day after the Closing Date all or
any portion of any outstanding Base Rate Loans (other than Swingline Loans) in a principal amount
equal to $3,000,000 or any whole multiple of $1,000,000 in excess thereof into one or more LIBOR
Rate Loans and (b) upon the expiration of any Interest Period, (i) convert all or any part of its
outstanding LIBOR Rate Loans in a principal amount equal to $2,000,000 or a whole multiple of
$1,000,000 in excess thereof into Base Rate Loans (other than Swingline Loans) or (ii) continue
such LIBOR Rate Loans as LIBOR Rate Loans. Whenever the Borrower desires to convert or continue
Loans as provided above, the Borrower shall give the Administrative Agent irrevocable prior written
notice in the form attached as Exhibit E (a “Notice of Conversion/Continuation”) not later
than 2:00 p.m. three (3) Business Days before the day on which a proposed conversion or
continuation of such Loan is to be effective specifying (A) the



45









 







Loans to be converted or continued, and, in the case of any LIBOR Rate Loan to be converted or
continued, the last day of the Interest Period therefor, (B) the effective date of such conversion
or continuation (which shall be a Business Day), (C) the principal amount of such Loans to be
converted or continued, and (D) the Interest Period to be applicable to such converted or continued
LIBOR Rate Loan. The Administrative Agent shall promptly notify the Lenders of such Notice of
Conversion/Continuation. In the event the Borrower shall fail to give any required notice as
described in this Section 4.2 or if such continuation or conversion is not permitted
pursuant to the terms of this Agreement, any LIBOR Rate Loans shall be automatically converted to
Base Rate Loans on the last day of the then expiring Interest Period.



     SECTION 4.3 Fees.



     (a) Commitment Fee. Commencing on the Closing Date, the Borrower shall pay to the
Administrative Agent, for the account of the Revolving Credit Lenders, a non-refundable commitment
fee at a rate per annum equal to the Applicable Margin on the average daily unused portion of the
Revolving Credit Commitment; provided, that the amount of outstanding Swingline Loans shall
not be considered usage of the Revolving Credit Commitment for the purpose of calculating such
commitment fee. The commitment fee shall be payable in arrears on the last Business Day of each
calendar quarter during the term of this Agreement commencing March 31, 2008 and ending on the
Revolving Credit Maturity Date. Such commitment fee shall be distributed by the Administrative
Agent to the Revolving Credit Lenders pro rata in accordance with the Lenders’
respective Revolving Credit Commitment Percentages.



     (b) Administrative Agent’s and Other Fees. The Borrower shall pay to the Arrangers
and the Administrative Agent for their own respective accounts fees in the amounts and at the times
specified in the applicable Fee Letter. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever.



     SECTION 4.4 Manner of Payment. Each payment by the Borrower on account of the
principal of or interest on the Loans or of any fee, commission or other amounts (including any
Reimbursement Obligation) payable to the Lenders under this Agreement shall be made not later than
1:00 p.m. on the date specified for payment under this Agreement to the Administrative Agent at the
Administrative Agent’s Office for the account of the Lenders (other than as set forth below)
pro rata in accordance with their respective Revolving Credit Commitment
Percentages (except as specified below), in Dollars, in immediately available funds, and shall be
made without any set-off, counterclaim or deduction whatsoever. Any payment received after such
time but before 2:00 p.m. on such day shall be deemed a payment on such date for the purposes of
Section 11.1, but for all other purposes shall be deemed to have been made on the next
succeeding Business Day. Any payment received after 2:00 p.m. shall be deemed to have been made on
the next succeeding Business Day for all purposes. Upon receipt by the Administrative Agent of
each such payment, the Administrative Agent shall distribute to each Lender at its address for
notices set forth herein its pro rata share of such payment in accordance with such Lender’s
Revolving Credit Commitment Percentage (except as specified below) and shall wire advice of the
amount of such credit to each Lender. Each payment to the Administrative Agent of any Issuing
Lender’s fees or L/C Participants’ commissions shall be made in like manner, but for the account of
the applicable Issuing Lender or the L/C Participants, as the case may be. Each payment to the
Administrative Agent of Administrative Agent’s fees or expenses shall be



46









 







made for the account of the Administrative Agent and any amount payable to any Lender under
Sections 4.9, 4.10, 4.11 or 13.3 shall be paid to the
Administrative Agent for the account of the applicable Lender. Subject to Section
4.1(b)(ii) if any payment under this Agreement shall be specified to be made upon a day which
is not a Business Day, it shall be made on the next succeeding day which is a Business Day and such
extension of time shall in such case be included in computing any interest if payable along with
such payment.



     SECTION 4.5 Evidence of Indebtedness.



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



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



     SECTION 4.6 Adjustments. If any Lender shall, by exercising any right of setoff or
counterclaim or otherwise, 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 (other
than pursuant to Sections 4.9, 4.10, 4.11 or 13.3 hereof) greater
than its pro rata share thereof as provided herein, 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 the aggregate amount of principal of and
accrued interest on their respective Loans and other amounts owing them; provided that



47









 





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



     (b) the provisions of this paragraph shall not be construed to apply to (x) any payment made
by the Borrower pursuant to and in accordance with the express terms of this Agreement 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 participations in Swingline Loans and Letters of Credit to any assignee or
participant, other than to the Borrower or any Restricted Subsidiary thereof (as to which the
provisions of this paragraph shall apply).


Each Credit 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 Credit Party rights of setoff and counterclaim with respect
to such participation as fully as if such Lender were a direct creditor of each Credit Party in the
amount of such participation.




     SECTION 4.7 Nature of Obligations of Lenders Regarding Extensions of Credit; Assumption by
the Administrative Agent. The obligations of the Lenders under this Agreement to make the
Loans and issue or participate in Letters of Credit are several and are not joint or joint and
several. Unless the Administrative Agent shall have received notice from a Lender prior to a
proposed borrowing date that such Lender will not make available to the Administrative Agent such
Lender’s ratable portion of the amount to be borrowed on such date (which notice shall not release
such Lender of its obligations hereunder), the Administrative Agent may assume that such Lender has
made such portion available to the Administrative Agent on the proposed borrowing date in
accordance with Section 2.3(b), and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower on such date a corresponding amount. If such amount is
made available to the Administrative Agent on a date after such borrowing date, such Lender shall
pay to the Administrative Agent on demand an amount, until paid, equal to the product of (a) the
amount not made available by such Lender in accordance with the terms hereof, times (b) the
daily average Federal Funds Rate during such period as determined by the Administrative Agent,
times (c) a fraction the numerator of which is the number of days that elapse from and
including such borrowing date to the date on which such amount not made available by such Lender in
accordance with the terms hereof shall have become immediately available to the Administrative
Agent and the denominator of which is 360. A certificate of the Administrative Agent with respect
to any amounts owing under this Section shall be presumed correct, absent manifest error. If such
Lender’s Revolving Credit Commitment Percentage of such borrowing is not made available to the
Administrative Agent by such Lender within three (3) Business Days after such borrowing date, the
Administrative Agent shall be entitled to recover such amount made available by the Administrative
Agent with interest thereon at the rate per annum applicable to Base Rate Loans hereunder, on
demand, from the Borrower. The failure of any Lender to make available its Revolving Credit
Commitment Percentage of any Loan requested by the Borrower shall not relieve it or any other
Lender of its obligation, if any, hereunder to make its Revolving Credit Commitment Percentage of
such Loan available on the borrowing date, but no Lender shall be responsible for the failure of
any other Lender to make its Revolving Credit Commitment Percentage of such Loan available on the
borrowing date.



48









 





     SECTION 4.8 Changed Circumstances.



     (a) Circumstances Affecting LIBOR Rate Availability. If the Required Lenders
determine that for any reason in connection with any request for a LIBOR Rate Loan or a conversion
to or continuation thereof that (a) Dollar deposits are not being offered to banks in the London
interbank eurodollar market for the applicable amount and Interest Period of such LIBOR Rate Loan,
(b) adequate and reasonable means do not exist for determining LIBOR for any requested Interest
Period with respect to a proposed LIBOR Rate Loan, or (c) because of changes in circumstances
affecting foreign exchange and interbank markets generally LIBOR for any requested Interest Period
with respect to a proposed LIBOR Rate Loan does not adequately and fairly reflect the cost to such
Lenders of funding such Loan, the Administrative Agent will promptly so notify the Borrower and
each Lender. Thereafter, the obligation of the Lenders to make or maintain LIBOR Rate Loans shall
be suspended until the Administrative Agent (upon the instruction of the Required Lenders) revokes
such notice. Upon receipt of such notice, the Borrower may revoke any pending request for a
Borrowing of, conversion to or continuation of LIBOR Rate Loans or, failing that, will be deemed to
have converted such request into a request for a borrowing of Base Rate Loans hereunder in the
amount specified therein.



     (b) Laws Affecting LIBOR Rate Availability. If, after the date hereof, the
introduction of, or any change in, any Applicable Law or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any of the Lenders (or any of
their respective Lending Offices) with any request or directive (whether or not having the force of
law) of any such Governmental Authority, central bank or comparable agency, shall make it unlawful
or impossible for any of the Lenders (or any of their respective Lending Offices) to honor its
obligations hereunder to make or maintain any LIBOR Rate Loan, or to determine or charge interest
rates based upon the LIBOR Rate, or any Governmental Authority imposes material restrictions on the
authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London
interbank markets, such Lender shall promptly give notice thereof to the Administrative Agent and
the Administrative Agent shall promptly give notice to the Borrower and the other Lenders.
Thereafter, until the Administrative Agent notifies the Borrower that such circumstances no longer
exist, (i) the obligations of such Lender to make or continue LIBOR Rate Loans and the right of the
Borrower to convert any Loan or continue any Loan as a LIBOR Rate Loan shall be suspended and
thereafter the Borrower may select only Base Rate Loans hereunder, and (ii) the Borrower shall,
upon demand from such Lender (with a copy to the Administrative Agent), repay or, if applicable,
convert all LIBOR Rate Loans of such Lender to Base Rate Loans, either on the last day of the
Interest Period therefor, if such Lender may lawfully continue to maintain such LIBOR Rate Loans to
such day, or immediately, if such Lender may not lawfully continue to maintain such LIBOR Rate
Loans. Upon any such repayment or conversion, the Borrower shall also pay accrued interest on the
amount so prepaid or converted.



     SECTION 4.9 Indemnity. Upon demand of any Lender (with a copy to the Administrative
Agent) from time to time, the Borrower shall promptly compensate such Lender for and hold such
Lender harmless from any loss, cost or expense incurred by it as a result of:



49









 





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



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



     (c) any assignment of a LIBOR Rate Loan on a day other than the last day of the Interest
Period therefor as a result of a request by the Borrower pursuant to Section 4.12(b);


including any loss or expense arising from the liquidation or reemployment of funds obtained by it
to maintain such Loan or from fees payable to terminate the deposits from which such funds were
obtained. The Borrower shall also pay any customary administrative fees charged by such Lender in
connection with the foregoing.




     For purposes of calculating amounts payable by the Borrower to the Lenders under this
Section 4.9, each Lender shall be deemed to have funded each LIBOR Rate Loan made by it at
LIBOR used in determining the LIBOR Rate for such Loan by a matching deposit or other borrowing in
the London interbank eurodollar market for a comparable amount and for a comparable period, whether
or not such LIBOR Rate Loan was in fact so funded.



     SECTION 4.10 Increased Costs.



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



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




          (ii) subject any Lender or any 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 LIBOR Rate
Loan made by it, or change the basis of taxation of payments to such Lender or such Issuing Lender
in respect thereof (except for Indemnified Taxes covered by Section 4.11 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 or any Issuing Lender or the London interbank market any other
condition, cost or expense affecting this Agreement or LIBOR Rate Loans made by such Lender or any
Letter of Credit or participation therein;



and the result of any of the foregoing shall be to increase the cost to such Lender of making,
converting into or maintaining any LIBOR Rate Loan (or of maintaining its obligation to make any
such Loan), or to increase the cost to such Lender or such 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 such Issuing Lender hereunder (whether of principal, interest or any other amount)


50









 






then, upon written request of such Lender or such Issuing Lender, the Borrower shall promptly pay
to any such Lender or such Issuing Lender, as the case may be, such additional amount or amounts as
will compensate such Lender or such Issuing Lender, as the case may be, for such additional costs
incurred or reduction suffered.




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



     (c) Certificates for Reimbursement. A certificate of a Lender or any Issuing Lender
setting forth the amount or amounts necessary to compensate such Lender or such Issuing Lender or
its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section and
delivered to the Borrower shall be presumed correct absent manifest error. The Borrower shall pay
such Lender or such Issuing Lender, as the case may be, the amount shown as due on any such
certificate within ten (10) days after receipt thereof.



     (d) Delay in Requests. Failure or delay on the part of any Lender or any Issuing
Lender to demand compensation pursuant to this Section shall not constitute a waiver of such
Lender’s or such Issuing Lender’s right to demand such compensation; provided that the
Borrower shall not be required to compensate a Lender or an Issuing Lender pursuant to this Section
for any increased costs incurred or reductions suffered more than six (6) months prior to the date
that such Lender or such Issuing Lender, as the case may be, notifies the Borrower of the Change in
Law giving rise to such increased costs or reductions and of such Lender’s or such Issuing Lender’s
intention to claim compensation therefor (except that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the six-month period referred to above shall be
extended to include the period of retroactive effect thereof).



     SECTION 4.11 Taxes.



     (a) 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; provided that if the Borrower
shall be required by Applicable Law to deduct any Indemnified Taxes from such payments, then (i)
the sum payable shall be increased as necessary so that after making all



51









 







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 Governmental Authority in accordance with Applicable Law.



     (b) Payment of Other Taxes by the Borrower. Without limiting the provisions of
paragraph (a) above, the Borrower shall timely pay any Other Taxes (other than Excluded Taxes) to
the relevant Governmental Authority in accordance with Applicable Law.



     (c) Indemnification by the Borrower. The Borrower shall indemnify the Administrative
Agent, each Lender and each Issuing Lender, within ten (10) days after demand therefor, for the
full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or
attributable to amounts payable under this Section) paid by the Administrative Agent, such Lender
or such 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 were correctly or
legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount
of such payment or liability delivered to the Borrower by a Lender or an Issuing Lender (with a
copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of
a Lender or an Issuing Lender, shall be presumed correct absent manifest error.



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



     (e) 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, 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 or other
withholding or information reporting requirements. Without limiting the generality of the
foregoing, in the event that the Borrower is a resident for tax purposes in the United States, 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:



52









 





          (i) duly completed copies of Internal Revenue Service Form W-8BEN claiming eligibility for
benefits of an income tax treaty to which the United States is a party,




          (ii) duly completed copies of Internal Revenue Service 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 881(c)(3)(B) of the Code, or (C) a
“controlled foreign corporation” described in section 881(c)(3)(C) of the Code and (y) duly
completed copies of Internal Revenue Service Form W-8BEN, or




          (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.




     (f) Treatment of Certain Refunds. If the Administrative Agent, a Lender or an 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 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 such Issuing Lender,
as the case may be, and without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund); provided that the Borrower, upon the request of the
Administrative Agent, such Lender or such Issuing Lender, agrees to repay the amount paid over to
the Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent, such Lender or such Issuing Lender in the event the
Administrative Agent, such Lender or such Issuing Lender is required to repay such refund to such
Governmental Authority. This paragraph shall not be construed to require the Administrative Agent,
any Lender or such Issuing Lender to make available its tax returns (or any other information
relating to its taxes which it deems confidential) to the Borrower or any other Person.



     (g) Survival. Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in this Section shall
survive the payment in full of the Obligations and the termination of the Revolving Credit
Commitment.



     SECTION 4.12 Mitigation Obligations; Replacement of Lenders.



     (a) Designation of a Different Lending Office. If any Lender requests compensation
under Section 4.10, or requires the Borrower to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to Section 4.11, then
such Lender shall use reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to another of its
offices,




53












 




branches or affiliates, if, in the reasonable judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section 4.10 or
Section 4.11, as the case may be, in the future and (ii) would not subject such Lender to
any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The
Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.




     (b) Replacement of Lenders. If any Lender requests compensation under Section
4.10, or if the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 4.11, or if any
Lender defaults in its obligation to fund Loans hereunder or is a Restricted Lender (as defined
below), then the Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance
with and subject to the restrictions contained in, and consents required by, Section
13.10), 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 13.10,




          (ii) such Lender shall have received payment of an amount equal to the outstanding principal
of its Loans and participations in Letters of Credit, 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 4.10 or payments required to be made pursuant to Section 4.11, such
assignment will result in a reduction in such compensation or payments thereafter,




          (iv) in the case of any such assignment by a Restricted Lender, the assignee must have
approved in writing the substance of the amendment, waiver or consent which caused the assignor to
be a Restricted Lender; and




          (v) 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. For the purposes of this Section 4.12, a
“Restricted Lender” means a Lender that fails to approve an amendment, waiver or consent
requested by the Credit Parties pursuant to Section 13.2 that has received the written
approval of not less than the Required Lenders but also requires the approval of such Lender.




     SECTION 4.13 Security. The Obligations of the Borrower shall be secured as provided
in the Security Documents.



54









 





ARTICLE V




CONDITIONS OF CLOSING AND BORROWING




     SECTION 5.1 Conditions to Closing and Initial Extensions of Credit. The obligation
of the Lenders to close this Agreement and to make the initial Loans or issue or participate in the
initial Letter of Credit, if any, is subject to the satisfaction of each of the following
conditions:



     (a) Executed Loan Documents. This Agreement, a Revolving Credit Note in favor of each
Lender requesting a Revolving Credit Note, a Swingline Note in favor of the Swingline Lender (if
requested thereby), the Security Documents, the Subsidiary Guaranty Agreement, together with any
other applicable Loan Documents, shall have been duly authorized, executed and delivered to the
Administrative Agent by the parties thereto, shall be in full force and effect and no Default or
Event of Default shall exist hereunder or thereunder.



     (b) Closing Certificates; Etc. The Administrative Agent shall have received each of
the following in form and substance reasonably satisfactory to the Administrative Agent:



          (i) Officer’s Certificate of the Borrower. A certificate from a Responsible Officer
of the Borrower to the effect that all representations and warranties of the Borrower contained in
this Agreement and the other Loan Documents are true, correct and complete; that none of the Credit
Parties is in violation of any of the covenants contained in this Agreement and the other Loan
Documents; that, after giving effect to the transactions contemplated by this Agreement, no Default
or Event of Default has occurred and is continuing; and that each of the Credit Parties, as
applicable, has satisfied each of the conditions set forth in Section 5.1 and Section
5.2 that has not been waived.




          (ii) Certificate of Secretary of each Credit Party. A certificate of a Responsible
Officer of each Credit Party certifying as to the incumbency and genuineness of the signature of
each officer of such Credit Party executing Loan Documents to which it is a party and certifying
that attached thereto is a true, correct and complete copy of (A) the articles or certificate of
incorporation or formation of such Credit Party and all amendments thereto, certified as of a
recent date by the appropriate Governmental Authority in its jurisdiction of incorporation or
formation, (B) the bylaws or other governing document of such Credit Party as in effect on the
Closing Date, (C) resolutions duly adopted by the board of directors or other governing body of
such Credit Party authorizing the transactions contemplated hereunder and the execution, delivery
and performance of this Agreement and the other Loan Documents to which it is a party, and (D) each
certificate required to be delivered pursuant to Section 5.1(b)(iii).




          (iii) Certificates of Good Standing. Certificates as of a recent date of the good
standing of each Credit Party under the laws of its jurisdiction of organization and, to the extent
requested by the Administrative Agent, each other jurisdiction where such Credit Party is qualified
to do business and, to the extent available, a certificate of the relevant taxing authorities of
such jurisdictions certifying that such Credit Party has filed required tax returns and owes no
delinquent taxes.





55









 








          (iv) Opinions of Counsel. Favorable opinions of counsel to the Credit Parties
addressed to the Administrative Agent and the Lenders with respect to the Credit Parties, the Loan
Documents and such other matters as the Lenders shall request.




          (v) Tax Forms. If applicable, copies of the United States Internal Revenue Service
forms required by Section 4.11(e).




     (c) Personal Property Collateral.



          (i) Filings and Recordings. The Administrative Agent shall have received all filings
and recordations that are necessary to perfect the security interests of the Administrative Agent,
on behalf of itself and the Lenders, in the Collateral shall have been received by the
Administrative Agent and the Administrative Agent shall have received evidence and evidence
reasonably satisfactory to the Administrative Agent that upon such filings and recordations such
security interests constitute valid and perfected first priority Liens thereon.




          (ii) Pledged Collateral. The Administrative Agent shall have received original stock
certificates or other certificates evidencing the Capital Stock pledged pursuant to the Security
Documents, together with an undated stock power for each such certificate duly executed in blank by
the registered owner thereof.




          (iii) Lien Search. The Administrative Agent shall have received the results of a Lien
search (including a search as to judgments, pending litigation and tax matters), in form and
substance reasonably satisfactory thereto, made against the Credit Parties under the Uniform
Commercial Code (or applicable judicial docket) as in effect in any state in which any of the
assets of such Credit Party are located, indicating among other things that its assets are free and
clear of any Lien except for Permitted Liens.




          (iv) Hazard and Liability Insurance. The Administrative Agent shall have received
certificates of property hazard, business interruption and liability insurance, evidence of payment
of all insurance premiums for the current policy year of each (naming the Administrative Agent as
additional insured on all certificates for liability insurance), and, if requested by the
Administrative Agent, copies (certified by a Responsible Officer) of insurance policies in the form
required under the Security Documents and otherwise in form and substance reasonably satisfactory
to the Administrative Agent.




     (d) Consents; Defaults.



          (i) Governmental and Third Party Approvals. The Credit Parties shall have received
all material governmental, shareholder and third party consents and approvals necessary (or any
other material consents as determined in the reasonable discretion of the Administrative Agent) in
connection with the transactions contemplated by this Agreement and the other Loan Documents and
the other transactions contemplated hereby and all applicable waiting periods shall have expired
without any action being taken by any Person that could reasonably be expected to restrain, prevent
or impose any material adverse conditions on any of the Credit Parties or such other transactions
or that could seek or threaten any of the foregoing, and no Applicable Law in the reasonable
judgment of the Administrative Agent could reasonably be expected to have such effect.





56









 








          (ii) No Injunction, Etc. No action, proceeding, investigation, regulation or
legislation shall have been instituted or overtly threatened in writing before any Governmental
Authority to enjoin, restrain or prohibit, or to obtain substantial damages in respect of, or that
is related to or arises out of this Agreement or the other Loan Documents or the consummation of
the transactions contemplated hereby or thereby.




     (e) Financial Matters.



          (i) Financial Statements. The Administrative Agent shall have received (A) a
pro forma Consolidated balance sheet of the Borrower and its Subsidiaries as of the
last month as to which financial statements are available, reflecting the capital structure of the
Borrower and its Subsidiaries after giving effect to the transactions contemplated hereby, prepared
and certified by the chief financial officer of the Borrower and (B) such other financial
information as the Administrative Agent may reasonably require, each of which shall be reasonably
satisfactory in all respects to the Administrative Agent.




          (ii) Financial Projections. The Administrative Agent shall have received pro
forma Consolidated financial statements for the Borrower and its Restricted Subsidiaries,
and forecasts prepared by management of the Borrower, of balance sheets, income statements and cash
flow statements on an annual basis for each year during the term of the Credit Facility.




          (iii) Financial Condition Certificate. The Borrower shall have delivered to the
Administrative Agent a certificate, in form and substance satisfactory to the Administrative Agent,
and certified as accurate by a Responsible Officer, that (A) the Borrower and each of its
Restricted Subsidiaries are Solvent, (B) the Borrower’s payables are current and no material part
thereof is past due, (C) attached thereto are calculations evidencing compliance on a pro
forma basis with the covenants contained in Article IX hereof, and (D) the
financial projections previously delivered to the Administrative Agent represent the good faith
estimates (utilizing assumptions believed by management of the Borrower to be reasonable) of the
financial condition and operations of the Borrower and its Restricted Subsidiaries.




          (iv) Payment at Closing; Fee Letters. The Borrower shall have paid to the
Administrative Agent and the Lenders the fees set forth or referenced in Section 4.3 that
are then due and any other accrued and unpaid fees or commissions due hereunder (including, without
limitation, legal fees and expenses) and to any other Person such amount as may be due thereto in
connection with the transactions contemplated hereby, including all taxes, fees and other charges
in connection with the execution, delivery, recording, filing and registration of any of the Loan
Documents.




     (f) Existing Credit Facility. The Existing Credit Facility shall be repaid in full
and all credit facilities, security interests and other agreements relating thereto shall have been
terminated (or provision for the termination thereof shall have been made) in a manner satisfactory
to the Administrative Agent and the Lenders, and the Administrative Agent shall have received a
pay-off letter in form and substance satisfactory to it regarding such repayment, termination and
release.



57









 





     (g) Miscellaneous.



          (i) Notice of Borrowing. As to the initial Extensions of Credit, the Administrative
Agent shall have received a Notice of Borrowing from the Borrower in accordance with Section
2.3(a), and a Notice of Account Designation specifying the account or accounts to which the
proceeds of any Loans made after the Closing Date are to be disbursed.




          (ii) Due Diligence. The Administrative Agent shall have completed, to its reasonable
satisfaction, all legal, tax, business and other due diligence with respect to the business,
assets, liabilities, operations and condition (financial or otherwise) of the Borrower and its
Subsidiaries in scope and determination reasonably satisfactory to the Administrative Agent in its
sole discretion.




          (iii) Other Documents. All opinions, certificates and other instruments and all
proceedings in connection with the transactions contemplated by this Agreement shall be
satisfactory in form and substance to the Administrative Agent. The Administrative Agent shall
have received copies of all other documents, certificates and instruments reasonably requested
thereby with respect to the transactions contemplated by this Agreement.




     SECTION 5.2 Conditions to All Extensions of Credit. The obligations of the Lenders
to make any Extensions of Credit (including the initial Extension of Credit) and convert or
continue any Loan of any Issuing Lender to issue or extend any Letter of Credit are subject to the
satisfaction of the following conditions precedent on the relevant borrowing, continuation,
conversion, issuance or extension date:



     (a) Continuation of Representations and Warranties. The representations and
warranties of the Borrower and each other Credit Party contained in Article VI and each
other Loan Document that are subject to materiality or Material Adverse Effect qualifications shall
be true and correct in all respects and the representations and warranties of the Borrower and each
other Credit Party contained in Article VI and each other Loan Document that are not
subject to materiality or Material Adverse Effect qualifications shall be true and correct in all
material respects, in each case, both before and after giving effect to such proposed borrowing,
continuation, conversion, issuance or extension, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they shall be true and correct as
of such earlier date.



     (b) No Existing Default. No Default or Event of Default shall have occurred and be
continuing (i) on the borrowing, continuation or conversion date with respect to such Loan or after
giving effect to the Loans to be made, continued or converted on such date or (ii) on the issuance
or extension date with respect to such Letter of Credit or after giving effect to the issuance or
extension of such Letter of Credit on such date.



     (c) Notices. The Administrative Agent shall have received a Notice of Borrowing or
Notice of Conversion/Continuation, as applicable, from the Borrower in accordance with Section
2.3(a) and Section 4.2.



     (d) Additional Documents. The Administrative Agent shall have received each
additional document, instrument, legal opinion or other item reasonably requested by it.



58









 





ARTICLE VI




REPRESENTATIONS AND WARRANTIES OF THE BORROWER




     SECTION 6.1 Representations and Warranties. To induce the Administrative Agent and
Lenders to enter into this Agreement and to induce the Lenders to make Extensions of Credit, the
Borrower hereby represents and warrants to the Administrative Agent and Lenders both before and
after giving effect to the transactions contemplated hereunder that:



     (a) Organization; Power; Qualification. Each of the Borrower and its Restricted
Subsidiaries is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation, has the power and authority to own its properties
and to carry on its business as now being and hereafter proposed to be conducted and is duly
qualified and authorized to do business in each jurisdiction in which the character of its
properties or the nature of its business requires such qualification and authorization except in
jurisdictions where the failure to be so qualified or in good standing could not reasonably be
expected to result in a Material Adverse Effect. The jurisdictions in which the Borrower and its
Restricted Subsidiaries are organized and qualified to do business as of the Closing Date are
described on Schedule 6.1(a).



     (b) Ownership. Each Subsidiary of the Borrower as of the Closing Date is listed on
Schedule 6.1(b). As of the Closing Date, the capitalization of the Subsidiaries of the
Borrower consists of the number of shares or other interests, authorized, issued and outstanding,
of such classes and series, with or without par value, described on Schedule 6.1(b). As of
the Closing Date, all outstanding shares have been duly authorized and validly issued and are fully
paid and nonassessable, with no personal liability attaching to the ownership thereof, and not
subject to any preemptive or similar rights, except as described in Schedule 6.1(b). The
shareholders, members or partners, as applicable, of each Subsidiary of the Borrower and the number
of shares owned by each as of the Closing Date are described on Schedule 6.1(b). As of the
Closing Date, there are no outstanding stock purchase warrants, subscriptions, options, securities,
instruments or other rights of any type or nature whatsoever that are convertible into,
exchangeable for or otherwise provide for or permit the issuance of Capital Stock of the
Subsidiaries of the Borrower, except as described on Schedule 6.1(b).



     (c) Authorization of Agreement, Loan Documents and Borrowing. Each of the Borrower
and its Restricted Subsidiaries has the right, power and authority and has taken all necessary
corporate and other action to authorize the execution, delivery and performance of this Agreement
and each of the other Loan Documents to which it is a party in accordance with their respective
terms. This Agreement and each of the other Loan Documents have been duly executed and delivered
by duly authorized officers or other representatives of the Borrower and each of its Restricted
Subsidiaries party thereto, and each such document constitutes the legal, valid and binding
obligation of the Borrower or the Restricted Subsidiary party thereto, enforceable in accordance
with its terms, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar state or federal debtor relief laws from time to time in
effect which affect the enforcement of creditors’ rights and the availability of equitable
remedies.



59









 





     (d) Compliance of Agreement, Loan Documents and Borrowing with Laws, Etc. The
execution, delivery and performance by the Borrower and its Restricted Subsidiaries of the Loan
Documents to which each such Person is a party, in accordance with their respective terms, the
Extensions of Credit hereunder and the transactions contemplated hereby do not and will not, by the
passage of time, the giving of notice or otherwise, (i) require any Governmental Approval or
violate any Applicable Law relating to the Borrower or any of its Restricted Subsidiaries where the
failure to obtain such Governmental Approval or such violation of Applicable Law could reasonably
be expected to have a Material Adverse Effect, (ii) conflict with, result in a breach of or
constitute a default under the articles of incorporation, bylaws or other organizational documents
of the Borrower or any of its Restricted Subsidiaries, (iii) conflict with, result in a breach of
or constitute a default under any indenture, agreement or other instrument to which such Person is
a party or by which any of its properties may be bound or any Governmental Approval relating to
such Person that could reasonably be expected to have a Material Adverse Effect, (iv) result in or
require the creation or imposition of any Lien upon or with respect to any property now owned or
hereafter acquired by such Person other than Liens arising under the Loan Documents and Permitted
Liens or (v) require any consent or authorization of, filing with, or other act in respect of, an
arbitrator or Governmental Authority and no consent of any other Person is required in connection
with the execution, delivery, performance, validity or enforceability of this Agreement other than
consents, authorizations, filings or other acts or consents that have been obtained or made or for
which the failure to obtain or make could not reasonably be expected to have a Material Adverse
Effect and other than consents or filings under the UCC.



     (e) Compliance with Law; Governmental Approvals. Each of the Borrower and its
Restricted Subsidiaries (i) has all Governmental Approvals required by any Applicable Law for it to
conduct its business, each of which is in full force and effect, is final and not subject to review
on appeal and is not the subject of any pending or, to its knowledge, threatened challenge by
direct or collateral proceeding, (ii) is in compliance with each Governmental Approval applicable
to it and in compliance with all other Applicable Laws relating to it or any of its respective
properties and (iii) has timely filed all reports, documents and other materials required to be
filed by it under all Applicable Laws with any Governmental Authority and has retained all records
and documents required to be retained by it under Applicable Law, except in each clause (i), (ii)
or (iii) above, where the failure to have, comply or file could not reasonably be expected to have
a Material Adverse Effect.



     (f) Tax Returns and Payments. Each of the Borrower and its Restricted Subsidiaries
has duly filed or caused to be filed all federal, state, local and other material tax returns
required by Applicable Law to be filed, and has paid, or made adequate provision for the payment
of, all federal, state, local and other material taxes, assessments and governmental charges or
levies upon it and its property, income, profits and assets that are due and payable. Such returns
accurately reflect in all material respects all material liabilities for taxes of the Borrower and
its Restricted Subsidiaries for the periods covered thereby. There is no ongoing audit or
examination or, to the knowledge of the Borrower, other investigation by any Governmental Authority
of the tax liability of the Borrower and its Restricted Subsidiaries. No Governmental Authority
has asserted any Lien or other claim against the Borrower or any Restricted Subsidiary with respect
to unpaid taxes that has not been discharged or resolved other than Permitted Liens. The charges,
accruals and reserves on the books of the Borrower and any of its Restricted



60









 







Subsidiaries in
respect of federal, state, local and other taxes for all Fiscal Years and portions thereof since
the organization of the Borrower and any of its Restricted Subsidiaries are in the judgment of the
Borrower adequate, and the Borrower does not anticipate any additional taxes or assessments for any
of such years.



     (g) Intellectual Property Matters. Each of the Borrower and its Restricted
Subsidiaries owns or possesses rights to use all material franchises, licenses, copyrights,
copyright applications, patents, patent rights or licenses, patent applications, trademarks,
trademark rights, service mark, service mark rights, trade names, trade name rights, copyrights and
other rights with respect to the foregoing that are reasonably necessary to conduct its business.
No event has occurred that permits, or after notice or lapse of time or both would permit, the
revocation or termination of any such rights, and neither the Borrower nor any Restricted
Subsidiary thereof is liable to any Person for infringement under Applicable Law with respect to
any such rights as a result of its business operations except as could not reasonably be expected
to have a Material Adverse Effect.



     (h) Environmental Matters. Except to the extent that any of the following,
individually or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect:



          (i) To the knowledge of the Borrower, the properties owned, leased or operated by the Borrower
and its Subsidiaries now or in the past do not contain, and have not previously contained, any
Hazardous Materials in amounts or concentrations that (A) constitute or constituted a violation of
applicable Environmental Laws or (B) could reasonably be expected to give rise to liability under
applicable Environmental Laws;




          (ii) The Borrower, each of its Subsidiaries and such properties and all operations conducted
in connection therewith are in compliance, and have been in compliance, with all applicable
Environmental Laws, and to the knowledge of the Borrower there is no contamination at, under or
about such properties or such operations that could interfere with the continued operation of such
properties or impair the fair saleable value thereof;




          (iii) Neither the Borrower nor any Subsidiary thereof has received from any Governmental
Authority, any written notice of violation, alleged violation, non-compliance, liability or
potential liability regarding Hazardous Materials or compliance with Environmental Laws, nor does
the Borrower or any Subsidiary thereof have knowledge or reason to believe that any such notice
will be received or is being threatened;




          (iv) To the knowledge of the Borrower, Hazardous Materials have not been transported or
disposed of to or from the properties owned, leased or operated by the Borrower and its
Subsidiaries in violation of, or in a manner or to a location that could give rise to liability
under, Environmental Laws, nor have any Hazardous Materials been generated, treated, stored or
disposed of at, on or under any of such properties in violation of, or in a manner that could
reasonably be expected to give rise to liability under, any applicable Environmental Laws;




          (v) No judicial proceedings or governmental or administrative action is pending, or, to the
knowledge of the Borrower, overtly threatened in writing, under any




61









 







Environmental Law to which the
Borrower or any Subsidiary thereof is or, to the Borrower’s knowledge will be, named as a
potentially responsible party with respect to such properties or operations conducted in connection
therewith, 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 Borrower, any Subsidiary or such properties or such
operations; and




          (vi) To the knowledge of the Borrower, there has been no release of Hazardous Materials at or
from properties owned, leased or operated by the Borrower or any Subsidiary, now or in the past, in
violation of or in amounts or in a manner that could give rise to liability under Environmental
Laws.




     (i) ERISA.



          (i) As of the Closing Date, neither the Borrower nor any ERISA Affiliate maintains or
contributes to, or has any obligation under, any Pension Plans or Multiemployer Plans other than
those identified on Schedule 6.1(i);




          (ii) The Borrower and each other Credit Party is in material compliance with all applicable
provisions of ERISA and the regulations and published interpretations thereunder, including the
prohibited transaction provisions of Section 406 of ERISA and Section 4975 of the Code, with
respect to all Employee Benefit Plans except for any required amendments for which the remedial
amendment period as defined in Section 401(b) of the Code has not yet expired and except where a
failure to so comply could not reasonably be expected to have a Material Adverse Effect. Each
Employee Benefit Plan that is intended to be qualified under Section 401(a) of the Code has been
determined by the Internal Revenue Service to be so qualified (or the Borrower is entitled to rely
on an opinion letter issued by the Internal Revenue Service to the sponsor of a prototype plan),
and each trust related to such plan has been determined to be exempt under Section 501(a) of the
Code except for such plans that have not yet received determination letters but for which the
remedial amendment period for submitting a determination letter (or an application for an opinion
letter) has not yet expired. No unsatisfied liability for any taxes or penalties has been incurred
by the Borrower or any other Credit Party with respect to any Employee Benefit Plan, or by any
other ERISA Affiliate with respect to any Pension Plan or Multiemployer Plan, except for a
liability that could not reasonably be expected to have a Material Adverse Effect;




          (iii) As of the Closing Date, no Pension Plan has been terminated, nor has any accumulated
funding deficiency (as defined in Section 412 of the Code) been incurred (without regard to any
waiver granted under Section 412 of the Code), nor has any funding waiver from the Internal Revenue
Service been received or requested with respect to any Pension Plan, nor has the Borrower or any
ERISA Affiliate failed to make any contributions or to pay any amounts due and owing as required by
Section 412 of the Code, Section 302 of ERISA or the terms of any Pension Plan prior to the due
dates of such contributions under Section 412 of the Code or Section 302 of ERISA, nor has there
been any event requiring any disclosure under Section 4041(c)(3)(C) or 4063(a) of ERISA with
respect to any Pension Plan;




62









 








          (iv) Except where the failure of any of the following representations to be correct in all
material respects could not reasonably be expected to have a Material Adverse Effect, neither the
Borrower nor any ERISA Affiliate has: (A) incurred any liability to the PBGC which remains
outstanding other than the payment of premiums and there are no premium payments which are due and
unpaid, (B) failed to make a required contribution or payment to a Multiemployer Plan, or (C)
failed to make a required installment or other required payment under Section 412 of the Code;




          (v) No Termination Event has occurred or is reasonably expected to occur; and




          (vi) Except where the failure of any of the following representations to be correct in all
material respects could not reasonably be expected to have a Material Adverse Effect, no
proceeding, claim (other than a benefits claim in the ordinary course of business), lawsuit and/or
investigation is existing or, to the best knowledge of the Borrower after due inquiry, threatened
concerning or involving any (A) employee welfare benefit plan (as defined in Section 3(1) of ERISA)
currently maintained or contributed to by the Borrower or any other Credit Party, (B) Pension Plan
or (C) Multiemployer Plan.




     (j) Margin Stock. Neither the Borrower nor any Restricted Subsidiary is engaged
principally or as one of its activities in the business of extending credit for the purpose of
“purchasing” or “carrying” any “margin stock” (as each such term is defined or used in Regulation U
of the Board of Governors of the Federal Reserve System). No part of the proceeds of any of the
Loans or Letters of Credit will be used for purchasing or carrying margin stock in violation of, or
for any purpose that violates the provisions of, Regulation T, U or X of such Board of Governors.
Following the application of the proceeds of each borrowing hereunder or drawing under each Letter
of Credit, not more than 25% of the aggregate value of the assets (either of the Borrower only or
of the Borrower and its Subsidiaries on a consolidated basis) that are subject to the provisions of
Section 10.2 or Section 10.4, or that are subject to any restriction contained in
any agreement or instrument between the Borrower and any Lender or any Affiliate of any Lender
relating to Indebtedness and within the scope of Section 11.1(g), will be margin stock.



     (k) Government Regulation. Neither the Borrower nor any Restricted Subsidiary is an
“investment company” or a company “controlled” by an “investment company” (as each such term is
defined or used in the Investment Company Act of 1940, as amended) or any other Applicable Law that
limits its ability to incur or consummate the transactions contemplated hereby.



     (l) Material Indebtedness. Schedule 6.1(l) sets forth a complete and accurate
list of all Material Indebtedness of the Borrower and its Restricted Subsidiaries in effect as of
the Closing Date not listed on any other Schedule hereto; other than as set forth in Schedule
6.1(l), each indenture, contract or agreement executed in connection with such Material
Indebtedness is, and after giving effect to the consummation of the transactions contemplated by
the Loan Documents will be, in full force and effect in accordance with the terms thereof. To the
extent requested by the Administrative Agent, the Borrower and its Restricted Subsidiaries have
delivered or otherwise made available to the Administrative Agent a true and complete copy of



63









 







each
indenture, contract or agreement executed in connection with the Material Indebtedness required to
be listed on Schedule 6.1(l) or any other Schedule hereto. Neither the Borrower nor any
Restricted Subsidiary (nor, to the knowledge of the Borrower, any other party thereto) is in breach
of or in default under any indenture, contract or agreement executed in connection with any
Material Indebtedness in any material respect.



     (m) Employee Relations. Each of the Borrower and its Restricted Subsidiaries has a
stable work force in place and is not, as of the Closing Date, party to any collective bargaining
agreement nor has any labor union been recognized as the representative of its employees except as
set forth on Schedule 6.1(m). The Borrower knows of no pending, threatened or contemplated
strikes, work stoppage or other collective labor disputes involving its employees or those of its
Restricted Subsidiaries that could reasonably be expected to have a Material Adverse Effect.



     (n) Burdensome Provisions. Neither the Borrower nor any Restricted Subsidiary thereof
is a party to any indenture, agreement, lease or other instrument, or subject to any corporate or
partnership restriction, Governmental Approval or Applicable Law that is so unusual or burdensome
as in the foreseeable future could be reasonably expected to have a Material Adverse Effect. The
Borrower and its Restricted Subsidiaries do not presently anticipate that future expenditures
needed to meet the provisions of any statutes, orders, rules or regulations of a Governmental
Authority will be so burdensome as to have a Material Adverse Effect. No Restricted Subsidiary is
a party to any agreement or instrument or otherwise subject to any restriction or encumbrance that
restricts or limits its ability to make dividend payments or other distributions in respect of its
Capital Stock to the Borrower or any Restricted Subsidiary or to transfer any of its assets or
properties to the Borrower or any Restricted Subsidiary in each case other than existing under or
by reason of the Loan Documents or Applicable Law.



     (o) Financial Statements. The Audited Financial Statements and the financial
statements delivered by the Borrower to the Administrative Agent pursuant to Sections
7.1(a), 7.1(b) and the last paragraph of Section 7.1 are complete and correct
and fairly present on a Consolidated basis the assets, liabilities and financial position of the
Borrower and its Subsidiaries as at such dates, and the results of the operations and changes of
financial position for the periods then ended (other than customary year-end adjustments for
unaudited financial statements). All such financial statements, including the related schedules
and notes thereto, have been prepared in accordance with GAAP. Such financial statements show all
material indebtedness and other material liabilities, direct or contingent, of the Borrower and its
Subsidiaries as of the date thereof, including material liabilities for taxes, material
commitments, and Indebtedness, in each case, to the extent required to be disclosed under GAAP.
All pro forma financial statements delivered by the Borrower to the Administrative
Agent were prepared in good faith on the basis of the assumptions stated therein, which assumptions
are believed to be reasonable in light of then existing conditions.



     (p) No Material Adverse Change. Since December 31, 2006, there has been no material
adverse change in the business, assets, material agreements, operations, liabilities (actual or
contingent) or condition (financial or otherwise) of the Borrower and its Subsidiaries and no event
has occurred or condition arisen that, either individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.



64









 





     (q) Solvency. As of the Closing Date and after giving effect to each Extension of
Credit made hereunder, the Borrower and each of its Restricted Subsidiaries will be Solvent.



     (r) Title to Properties. Each of the Borrower and its Restricted Subsidiaries has
such title to the real property owned or leased by it as is necessary or desirable to the conduct
of its business and valid and legal title to all of its personal property and assets, including,
but not limited to, those reflected on the balance sheets of the Borrower and its Restricted
Subsidiaries described in Section 6.1(o), except those which have been disposed of by the
Borrower or its Restricted Subsidiaries subsequent to such date which dispositions are expressly
permitted hereunder.



     (s) Insurance. The properties of the Borrower and its Restricted Subsidiaries are
insured with financially sound and reputable insurance companies not Affiliates of the Borrower, in
such amounts, with such self-insurance and deductibles and covering such risks as are customarily
maintained by companies engaged in similar businesses and owning similar properties in locations
where the Borrower or the applicable Restricted Subsidiary operates.



     (t) Liens. None of the properties and assets of the Borrower or any Restricted
Subsidiary thereof is subject to any Lien, except Permitted Liens. Neither the Borrower nor any
Restricted Subsidiary thereof has signed any financing statement or any security agreement
authorizing any secured party thereunder to file any financing statement, except to perfect those
Permitted Liens.



     (u) Litigation. Except for matters existing on the Closing Date and set forth on
Schedule 6.1(u), there are no actions, suits or proceedings pending nor, to the knowledge
of the Borrower, threatened against or in any other way relating adversely to or affecting the
Borrower or any Restricted Subsidiary thereof or any of their respective properties in any court or
before any arbitrator of any kind or before or by any Governmental Authority that (i) either
individually or in the aggregate, has had, or could reasonably be expected to have, a Material
Adverse Effect, or (ii) materially adversely affects any transaction contemplated hereby.



     (v) Absence of Defaults. No event has occurred or is continuing that constitutes a
Default or an Event of Default, or that constitutes, or that with the passage of time or giving of
notice or both would constitute, a default or event of default by the Borrower or any Restricted
Subsidiary thereof under any Material Indebtedness or any material judgment, decree or order to
which the Borrower or its Restricted Subsidiaries is a party or by that the Borrower or its
Restricted Subsidiaries or any of their respective properties may be bound or which would require
the Borrower or its Restricted Subsidiaries to make any payment thereunder prior to the scheduled
maturity date therefor.



     (w) Senior Indebtedness Status. The Obligations of the Borrower and each of its
Restricted Subsidiaries under this Agreement and each of the other Loan Documents ranks and shall
continue to rank at least senior in priority of payment to all Subordinated Indebtedness.



     (x) OFAC. None of the Borrower, any Subsidiary of the Borrower or any Affiliate of
the Borrower or any Subsidiary Guarantor: (i) is a Sanctioned Person, (ii) has more than 10% of
its assets in Sanctioned Entities, or (iii) derives more than 10% of its operating income from



65









 







investments in, or transactions with Sanctioned Persons or Sanctioned Entities. The proceeds of
any Loan will not be used and have not been used to fund any operations in, finance any investments
or activities in, or make any payments to, a Sanctioned Person or a Sanctioned Entity.



     (y) Disclosure. No financial statement, material report, material certificate or
other material information furnished (whether in writing or orally), taken together as a whole, by
or on behalf of any of the Borrower or any of its Subsidiaries to the Administrative Agent or any
Lender in connection with the transactions contemplated hereby and the negotiation of this
Agreement or delivered hereunder (as modified or supplemented by other information so furnished)
contains any material misstatement of any material fact or omits to state any material fact
necessary to make the statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projected financial information, pro
forma financial information, estimated financial information and other projected or estimated
information, the Borrower represents only that such information was prepared in good faith based
upon assumptions believed by the management of the Borrower to be reasonable at the time.



     SECTION 6.2 Survival of Representations and Warranties, Etc. All representations and
warranties set forth in this Article VI and all representations and warranties contained in
any certificate, or any of the Loan Documents (including, but not limited to, any such
representation or warranty made in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement. All representations and warranties made
under this Agreement shall be made or deemed to be made at and as of the Closing Date (except those
that are expressly made as of a specific date), shall survive the Closing Date and shall not be
waived by the execution and delivery of this Agreement, any investigation made by or on behalf of
the Lenders or any borrowing hereunder.



ARTICLE VII




FINANCIAL INFORMATION AND NOTICES




     Until all the Obligations have been paid and satisfied in full and the Revolving Credit
Commitment has been terminated, unless consent has been obtained in the manner set forth in
Section 13.2, the Borrower will furnish or cause to be furnished to the Administrative
Agent at the Administrative Agent’s Office at the address set forth in Section 13.1 or such
other office as may be designated by the Administrative Agent from time to time:



     SECTION 7.1 Financial Statements and Projections.



     (a) Quarterly Financial Statements. As soon as practicable and in any event within
forty-five (45) days (or, if earlier, on the date of any required public filing thereof) after the
end of each fiscal quarter of each Fiscal Year (other than the last fiscal quarter of any such
Fiscal Year), an unaudited Consolidated balance sheet of the Borrower and its Subsidiaries as of
the close of such fiscal quarter and unaudited Consolidated statements of income or operations,
stockholders’ equity and cash flows and a report containing management’s discussion and analysis of
such financial statements for the fiscal quarter then ended and that portion of the



66









 







Fiscal Year
then ended, including the notes thereto, all in reasonable detail setting forth in comparative form
the corresponding figures as of the end of and for the corresponding period in the preceding Fiscal
Year and prepared by the Borrower in accordance with GAAP and, if applicable, containing disclosure
of the effect on the financial position or results of operations of any change in the application
of accounting principles and practices during the period, and certified by the chief financial
officer of the Borrower to present fairly in all material respects the financial condition of the
Borrower and its Subsidiaries on a Consolidated basis as of their respective dates and the results
of operations of the Borrower and its Subsidiaries for the respective periods then ended, subject
to normal year end adjustments. Delivery by the Borrower to the Administrative Agent of the
Borrower’s quarterly report to the SEC on Form 10–Q with respect to any fiscal quarter, or the
availability of such report on EDGAR Online (to the extent such report complies with the
requirements of this clause (a)), within the period specified above shall be deemed to be
compliance by the Borrower with this Section 7.1(a).



     (b) Annual Financial Statements. As soon as practicable and in any event within
ninety (90) days (or, if earlier, on the date of any required public filing thereof) after the end
of each Fiscal Year, an audited Consolidated balance sheet of the Borrower and its Subsidiaries as
of the close of such Fiscal Year and audited Consolidated statements of income or operations,
stockholders’ equity and cash flows and a report containing management’s discussion and analysis of
such financial statements for the Fiscal Year then ended, including the notes thereto, all in
reasonable detail setting forth in comparative form the corresponding figures as of the end of and
for the preceding Fiscal Year and prepared in accordance with GAAP and, if applicable, containing
disclosure of the effect on the financial position or results of operations of any change in the
application of accounting principles and practices during the year. Such annual financial
statements shall be audited by an independent certified public accounting firm reasonably
acceptable to the Administrative Agent, and accompanied by a report thereon by such certified
public accountants that is not qualified with respect to scope limitations imposed by the Borrower
or any of its Subsidiaries or with respect to accounting principles followed by the Borrower or any
of its Subsidiaries not in accordance with GAAP. Delivery by the Borrower to the Administrative
Agent of the Borrower’s annual report to the SEC on Form 10-K with respect to any Fiscal Year, or
the availability of such report on EDGAR Online (to the extent such report complies with the
requirements of this clause (b)), within the period specified above shall be deemed to be
compliance by the Borrower with this Section 7.1(b).



     (c) Annual Business Plan and Financial Projections. As soon as practicable and in any
event within sixty (60) days after the end of each Fiscal Year, a business plan of the Borrower and
its Subsidiaries for the ensuing four (4) fiscal quarters, such plan to be prepared in accordance
with GAAP to the extent applicable and to include, on a quarterly basis, the following: a
quarterly operating and capital budget, a projected income statement, statement of cash flows and
balance sheet and a report containing management’s discussion and analysis of such projections,
accompanied by a certificate from a Responsible Officer of the Borrower to the effect that, to such
officer’s knowledge, such projections are good faith estimates (utilizing reasonable assumptions)
of the financial condition and operations of the Borrower and its Subsidiaries for such four (4)
quarter period.



67









 





     If the Borrower has designated any of its Subsidiaries as Unrestricted Subsidiaries, then the
quarterly financial information required by clause (a) above, the annual financial information
required by clause (b) above and the projected financial statements required by clause (c) above
shall include a reasonably detailed presentation satisfactory to the Administrative Agent, either
on the face of the financial statements or in the footnotes thereto, and in Management’s Discussion
and Analysis of Financial Condition and Results of Operations, of the financial condition and
results of operations of the Borrower and its Restricted Subsidiaries separate from the financial
condition and results of operations of its Unrestricted Subsidiaries.



     SECTION 7.2 Officer’s Compliance Certificate. At each time financial statements are
delivered pursuant to Sections 7.1(a) or (b) and at such other times as the
Administrative Agent shall reasonably request, an Officer’s Compliance Certificate.



     SECTION 7.3 Accountants’ Certificate. At each time financial statements are
delivered pursuant to Section 7.1(b), a certificate of the independent public accountants
certifying such financial statements that in connection with their audit, nothing came to their
attention that caused them to believe that the Borrower failed to comply with the terms, covenants,
provisions or conditions of Article IX insofar as they relate to financial and accounting
matters or, if such is not the case, specifying such non-compliance and its nature and period of
existence.



     SECTION 7.4 Other Reports. Such other information regarding the operations, business
affairs and financial condition of the Borrower or any of its Subsidiaries as the Administrative
Agent or any Lender may reasonably request.



     SECTION 7.5 Notice of Litigation and Other Matters. Prompt (but in no event later
than fifteen (15) days after a Responsible Officer of the Borrower obtains knowledge thereof)
telephonic and written notice of:



     (a) the commencement of, or any material development in, all proceedings and investigations by
or before any Governmental Authority and all actions and proceedings in any court or before any
arbitrator against or involving the Borrower or any Restricted Subsidiary thereof or any of their
respective properties, assets or businesses that if adversely determined could reasonably be
expected to have a Material Adverse Effect;



     (b) any notice of any violation received by the Borrower or any Restricted Subsidiary thereof
from any Governmental Authority including, without limitation, any notice of violation of
Environmental Laws, that in any such case could reasonably be expected to have a Material Adverse
Effect;



     (c) any labor controversy that has resulted in, or threatens to result in, a strike or other
work action against the Borrower or any Restricted Subsidiary thereof that could reasonably be
expected to have a Material Adverse Effect;



     (d) any litigation or proceeding affecting the Borrower or any of its Restricted Subsidiaries
that could reasonably be expected to be determined adversely to the Borrower or its Restricted
Subsidiaries and in which the amount involved is $20,000,000 or more and not covered by insurance
or in which injunctive or similar relief is sought;



68









 





     (e) (i) any Default or Event of Default or (ii) any event that constitutes or that with the
passage of time or giving of notice or both would constitute a default or event of default under
any Material Indebtedness;



     (f) (i) any unfavorable determination letter from the Internal Revenue Service regarding the
qualification of an Employee Benefit Plan under Section 401(a) of the Code (along with a copy
thereof), (ii) all notices received by the Borrower or any ERISA Affiliate of the PBGC’s intent to
terminate any Pension Plan or to have a trustee appointed to administer any Pension Plan, (iii) all
notices received by the Borrower or any ERISA Affiliate from a Multiemployer Plan sponsor
concerning the imposition or amount of withdrawal liability pursuant to Section 4202 of ERISA and
(iv) the Borrower obtaining knowledge or reason to know that the Borrower or any ERISA Affiliate
has filed or intends to file a notice of intent to terminate any Pension Plan under a distress
termination within the meaning of Section 4041(c) of ERISA; and



     (g) the designation of any Subsidiary as a “restricted subsidiary” (or any similar
designation), or the joinder of any Subsidiary as a guarantor, under any Material Indebtedness or
any other Indebtedness permitted pursuant to Section 10.1(k).



     SECTION 7.6 Accuracy of Information. All written information, reports, statements
and other papers and data furnished by or on behalf of the Borrower to the Administrative Agent or
any Lender whether pursuant to this Article VII or any other provision of this Agreement,
or any of the Security Documents, shall, at the time the same is so furnished, comply with the
representations and warranties set forth in Section 6.1(y).



     SECTION 7.7 Posting of Borrower Materials. The Borrower hereby acknowledges that (a)
the Administrative Agent and/or the Arrangers will make available to the Lenders and the Issuing
Lenders materials and/or information provided by or on behalf of the Borrower hereunder
(collectively, “Borrower Materials”) by posting the Borrower Materials on IntraLinks or
another similar electronic system (the “Platform”) and (b) certain of the Lenders (each, a
“Public Lender”) may have personnel who do not wish to receive material non-public
information with respect to the Borrower or its Affiliates, or the respective securities of any of
the foregoing, and who may be engaged in investment and other market-related activities with
respect to such Persons’ securities. The Borrower hereby agrees that (w) all Borrower Materials
that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC”
which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page
thereof; (x) by marking Borrower Materials “PUBLIC”, the Borrower shall be deemed to have
authorized the Administrative Agent, the Arrangers, the L/C Issuers and the Lenders to treat such
Borrower Materials as not containing any material non-public information with respect to the
Borrower or its securities for purposes of United States Federal and state securities laws
(provided, however, that to the extent such Borrower Materials constitute
Information, they shall be treated as set forth in Section 13.11); (y) all Borrower
Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform
designated “Public Investor”; and (z) the Administrative Agent and the Arrangers shall be entitled
to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on
a portion of the Platform not designated “Public Investor”.



69









 





ARTICLE VIII




AFFIRMATIVE COVENANTS




     Until all of the Obligations have been paid and satisfied in full and the Revolving Credit
Commitment has been terminated, and unless a waiver or consent has been obtained in the manner
provided for in Section 13.2, the Borrower will, and will cause each of its Restricted
Subsidiaries to:



     SECTION 8.1 Preservation of Corporate Existence and Related Matters.



     Except as permitted by Section 8.1(b) or Section 10.3:



     (a) Preserve and keep in full force and effect its corporate existence, and the corporate,
partnership or other existence of each of its Subsidiaries, in accordance with the respective
organizational documents of the Borrower or any such Subsidiary, and qualify and remain qualified
as a foreign organization and authorized to do business in each jurisdiction in which the failure
to so qualify could reasonably be expected to have a Material Adverse Effect.



     (b) Preserve and keep in full force and effect the rights (charter and statutory), licenses
and franchises of the Borrower and its Subsidiaries; provided, that the Borrower shall not
be required to preserve any such right, license or franchise, or the corporate, partnership or
other existence of any of its Subsidiaries, if the board of directors of the Borrower shall
determine that the preservation thereof is no longer desirable in the conduct of the business of
the Borrower and its Subsidiaries, taken as a whole, and that the loss thereof is not adverse in
any material respect to the Lenders.



     SECTION 8.2 Maintenance of Property. Protect and preserve all material properties
necessary in and material to its business, including copyrights, patents, trade names, service
marks and trademarks; maintain in good working order and condition, ordinary wear and tear
excepted, all buildings, equipment and other tangible real and personal property; and from time to
time make or cause to be made all repairs, renewals and replacements thereof and additions to such
property necessary for the conduct of its business, so that the business carried on in connection
therewith may be conducted in a commercially reasonable manner.



     SECTION 8.3 Insurance. Maintain insurance with financially sound and reputable
insurance companies against such risks and in such amounts as are customarily maintained by similar
businesses and as may be required by Applicable Law and as are required by any Security Documents
(including, without limitation, hazard and business interruption insurance), and on the Closing
Date and from time to time thereafter deliver to the Administrative Agent upon its request
information in reasonable detail as to the insurance then in effect, stating the names of the
insurance companies, the amounts and rates of the insurance, the dates of the expiration thereof
and the properties and risks covered thereby.



     SECTION 8.4 Accounting Methods and Financial Records. Maintain a system of
accounting, and keep proper books, records and accounts (that shall be true and correct in all
material respects) as may be required or as may be necessary to permit the preparation of



70









 







financial
statements in accordance with GAAP and in compliance with applicable regulations of any
Governmental Authority having jurisdiction over it or any of its properties.



     SECTION 8.5 Payment and Performance of Obligations. Pay and perform all Obligations
under this Agreement and the other Loan Documents, and pay or perform (a) all taxes, assessments
and other governmental charges that may be levied or assessed upon it or any of its property, and
(b) all other indebtedness, obligations and liabilities in accordance with customary trade
practices; provided, that the Borrower or such Restricted Subsidiary may contest any item
described in clauses (a) or (b) of this Section in good faith so long as adequate reserves are
maintained with respect thereto in accordance with GAAP.



     SECTION 8.6 Compliance With Laws and Approvals. Observe and remain in compliance
with all Applicable Laws and maintain in full force and effect all Governmental Approvals, in each
case applicable to the conduct of its business except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.



     SECTION 8.7 Environmental Laws. In addition to and without limiting the generality
of Section 8.6, and except to the extent that a failure to comply with any of the
following, individually or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect, (a) comply with, and use reasonable efforts to ensure such compliance by all of its
tenants and subtenants, if any, with, all applicable Environmental Laws and obtain and comply with
and maintain, and use reasonable efforts to ensure that all tenants and subtenants, if any, obtain
and comply with and maintain, any and all licenses, approvals, notifications, registrations or
permits required by applicable Environmental Laws, and (b) 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 any Governmental
Authority regarding Environmental Laws. Except as otherwise noted, the Borrower will defend,
indemnify and hold harmless the Administrative Agent and the Lenders, and their respective parents,
Subsidiaries, Affiliates, employees, agents, officers and directors, from and against any claims,
demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind
or nature, known or unknown, contingent or otherwise, arising out of, or in any way relating to the
presence of Hazardous Materials in, on or under properties owned, leased or operated by the
Borrower and its Subsidiaries, or the Borrower’s or any of its Subsidiaries’ violation of,
noncompliance with or liability under any Environmental Laws applicable to the operations of the
Borrower or any such Subsidiary, or any orders, requirements or demands of Governmental Authorities
related thereto, including, without limitation, reasonable attorney’s and consultant’s fees,
investigation and laboratory fees, response costs, court costs and litigation expenses, except to
the extent that any of the foregoing directly result from the gross negligence or willful
misconduct of the party seeking indemnification therefor, as determined by a court of competent
jurisdiction by final nonappealable judgment.



     SECTION 8.8 Compliance with ERISA. In addition to and without limiting the
generality of Section 8.6, (a) except where the failure to so comply could not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (i)
comply with all material applicable provisions of ERISA and the regulations and published
interpretations thereunder with respect to all Employee Benefit Plans, (ii) not take any action or
fail to take action the result of which could be a liability to the PBGC or to a Multiemployer
Plan, (iii) not



71









 







participate in any prohibited transaction that could result in any civil penalty
under ERISA or tax under the Code and (iv) operate each Employee Benefit Plan in such a manner that
will not incur any tax liability under Section 4980B of the Code or any liability to any qualified
beneficiary as defined in Section 4980B of the Code and (b) furnish to the Administrative Agent
upon the Administrative Agent’s request such additional information about any Employee Benefit Plan
as may be reasonably requested by the Administrative Agent.



     SECTION 8.9 Compliance With Agreements. Comply in all material respects with each
material term, condition and provision of all material leases, agreements and other instruments
entered into in the conduct of its business including, without limitation, any indenture, contract
or agreement executed in connection with any Material Indebtedness; provided, that the
Borrower or any such Restricted Subsidiary may contest any such lease, agreement or other
instrument in good faith through applicable proceedings so long as adequate reserves are maintained
in accordance with GAAP. 



     SECTION 8.10 Visits and Inspections. Permit representatives of the Administrative
Agent or any Lender, from time to time upon prior reasonable notice and at such times during normal
business hours, at the Borrower’s expense, to visit and inspect its properties; inspect, audit and
make extracts from its books, records and files, including, but not limited to, management letters
prepared by independent accountants; and discuss with its principal officers, and its independent
accountants, its business, assets, liabilities, financial condition and results of operations.
Upon the occurrence and during the continuance of an Event of Default, the Administrative Agent or
any Lender may do any of the foregoing at any time without advance notice.



     SECTION 8.11 Additional Subsidiaries.



     (a) Additional Domestic Subsidiaries. Notify the Administrative Agent of (i) the
redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary in accordance with
Section 8.12 or (ii) the creation or acquisition of any Domestic Subsidiary that is a
Restricted Subsidiary and promptly thereafter (and in any event within thirty (30) days), cause
such Person to (i) become a Subsidiary Guarantor by delivering to the Administrative Agent a duly
executed supplement to the Subsidiary Guaranty Agreement or such other document as the
Administrative Agent shall deem appropriate for such purpose, (ii) pledge a security interest in
all applicable Collateral covered under the Security Documents owned by such Restricted Subsidiary
by delivering to the Administrative Agent a duly executed supplement to each Security Document or
such other document as the Administrative Agent reasonably shall deem appropriate for such purpose
and to comply with the terms of each Security Document, (iii) deliver to the Administrative Agent
such documents and certificates referred to in Section 5.1 as may be reasonably requested
by the Administrative Agent, (iv) deliver to the Administrative Agent such original Capital Stock
or other certificates and stock or other transfer powers evidencing the Capital Stock of such
Person, (v) deliver to the Administrative Agent such updated Schedules to the Loan Documents as may
be reasonably requested by the Administrative Agent with respect to such Person, and (vi) deliver
to the Administrative Agent such other documents as may be reasonably requested by the
Administrative Agent, all in form, content and scope reasonably satisfactory to the Administrative
Agent.



72









 





     (b) Additional Foreign Subsidiaries. Notify the Administrative Agent at the time that
any Person becomes a first-tier Foreign Subsidiary that is a Restricted Subsidiary, and promptly
thereafter (and in any event within forty-five (45) days after notification), cause (i) the
Borrower or the applicable Restricted Subsidiary to deliver to the Administrative Agent Security
Documents pledging sixty-five percent (65%) (or such lesser percentage as may then be necessary to
avoid material adverse tax consequences) of the total outstanding Capital Stock of such new Foreign
Subsidiary and a consent thereto executed by such new Foreign Subsidiary (including, without
limitation, if applicable, original stock certificates (or the equivalent thereof pursuant to the
Applicable Laws and practices of any relevant foreign jurisdiction) evidencing the Capital Stock of
such new Foreign Subsidiary, together with an appropriate undated stock power for each certificate
duly executed in blank by the registered owner thereof), (ii) such Person to deliver to the
Administrative Agent such documents and certificates referred to in Section 5.1 as may be
reasonably requested by the Administrative Agent (specifically excluding, however, any joinders or
supplements to the Subsidiary Guaranty Agreement and the Security Documents), (iii) such Person to
deliver to the Administrative Agent such updated Schedules to the Loan Documents as may be
reasonably requested by the Administrative Agent with regard to such Person and (iv) such Person to
deliver to the Administrative Agent such other documents as may be reasonably requested by the
Administrative Agent, all in form, content and scope reasonably satisfactory to the Administrative
Agent.



     SECTION 8.12 Designation of Restricted and Unrestricted Subsidiaries.



     (a) Subject to the terms of this Section, the board of directors of the Borrower may designate
any Restricted Subsidiary as an Unrestricted Subsidiary (or designate any newly formed or acquired
Subsidiary as an Unrestricted Subsidiary to the extent such formation or acquisition is otherwise
permitted hereunder); provided that (i) such designation would not result in a Default or
Event of Default and (ii) any such individual Subsidiary is not a guarantor of, or a “restricted
subsidiary” (or equivalent term) under, any Material Indebtedness or any other Indebtedness
permitted pursuant to Section 10.1(k). If a Subsidiary is designated as an Unrestricted
Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Borrower
and its Restricted Subsidiaries in such Subsidiary shall be deemed to be Investments made as of the
time of the designation, subject to the limitations hereof on Restricted Payments. That
designation shall only be permitted if the Investment would be permitted at that time and if the
Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.



     (b) Any designation of a Subsidiary as an Unrestricted Subsidiary shall be evidenced to the
Administrative Agent by providing prompt written notice to the Administrative Agent together with a
certified copy of the resolution of the board of directors of the Borrower giving effect to such
designation and a certificate from a Responsible Officer of the Borrower certifying that such
designation complied with the conditions set forth in the definition of “Unrestricted Subsidiary”
and was permitted by this Section. If, at any time, any Unrestricted Subsidiary would fail to meet
the requirements as an Unrestricted Subsidiary, it shall thereafter cease to be deemed an
Unrestricted Subsidiary for purposes of this Agreement and the other Loan Documents and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the
Borrower as of such date and, if such Indebtedness is not permitted




73












 




to be incurred as of such date under Section 10.1, the Borrower shall be in Default of
such covenant.




     (c) The board of directors of the Borrower may at any time redesignate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided that such redesignation shall be deemed
to be an incurrence of Indebtedness by a Restricted Subsidiary of the Borrower of any outstanding
Indebtedness of such Unrestricted Subsidiary and such redesignation shall only be permitted if (i)
such Indebtedness is permitted under Section 10.1, (ii) the Borrower has demonstrated to
the Administrative Agent compliance with Section 9.1, Section 9.2 and Section
9.3 calculated on a pro forma basis as if such redesignation had occurred at
the beginning of the most recent four-quarter period ended prior to the date of such redesignation
for which financial statements have to be delivered pursuant to Section 7.1, (iii) the
Borrower has complied with Section 8.11, and (iv) no Default or Event of Default would be
in existence following such redesignation.



     (d) Notwithstanding the foregoing, promptly after the date on which the Borrower or the
Administrative Agent determines that any individual Unrestricted Subsidiary fails to satisfy the
requirements specified in the definition of “Unrestricted Subsidiary”, then such Unrestricted
Subsidiary shall be redesignated as a Restricted Subsidiary and the Borrower agrees to deliver all
instruments, documents, certificates and opinions required pursuant to Section 8.11(a).



     SECTION 8.13 Use of Proceeds. The Borrower shall use the proceeds of the Extensions
of Credit (a) to refinance and/or replace existing Indebtedness of the Borrower under the Existing
Credit Facility, (b) for general corporate purposes of the Borrower and its Restricted
Subsidiaries, including, without limitation, working capital, capital expenditures in the ordinary
course of business and Permitted Acquisitions, and (c) to pay fees and expense related to this
Agreement.



     SECTION 8.14 Further Assurances. Make, execute and deliver all such additional and
further acts, things, deeds and instruments as the Administrative Agent or the Required Lenders
(through the Administrative Agent) may reasonably require to document and consummate the
transactions contemplated hereby and to vest completely in and insure the Administrative Agent and
the Lenders their respective rights under this Agreement, the Letters of Credit and the other Loan
Documents.



ARTICLE IX




FINANCIAL COVENANTS




     Until all of the Obligations have been paid and satisfied in full and the Revolving Credit
Commitment has been terminated, and unless a waiver or consent has been obtained in the manner set
forth in Section 13.2, the Borrower and its Restricted Subsidiaries on a Consolidated basis
will not:



     SECTION 9.1 Consolidated Total Leverage Ratio. As of any fiscal quarter end, permit
the Consolidated Total Leverage Ratio to be greater than 5.00 to 1.00.



74









 





     SECTION 9.2 Consolidated Secured Leverage Ratio. As of any fiscal quarter end, permit
the Consolidated Secured Leverage Ratio to be greater than 2.50 to 1.00.



     SECTION 9.3 Interest Coverage Ratio. As of any fiscal quarter end, permit the ratio
of (a) Consolidated EBITDA for the period of four (4) consecutive fiscal quarters ending on such
date to (b) Consolidated Interest Expense for the period of four (4) consecutive fiscal quarters
ending on such date to be less than 2.25 to 1.00.



ARTICLE X




NEGATIVE COVENANTS




     Until all of the Obligations have been paid and satisfied in full and the Revolving Credit
Commitment has been terminated, and unless a waiver or consent has been obtained in the manner set
forth in Section 13.2, the Borrower will not and will not permit any of its Restricted
Subsidiaries to:



     SECTION 10.1 Limitations on Indebtedness. Create, incur, assume or suffer to exist
any Indebtedness except:



     (a) the Obligations (excluding Hedging Obligations permitted pursuant to Section
10.1(b));



     (b) Indebtedness incurred in connection with a Hedging Agreement with a counterparty and upon
terms and conditions (including interest rate) reasonably satisfactory to the Administrative Agent;
provided, that any counterparty that is a Lender shall be deemed satisfactory to the
Administrative Agent;



     (c) Indebtedness existing on the Closing Date and listed on Schedule 6.1(l), and the
renewal, refinancing, refunding, extension and replacement (but not the increase in the aggregate
principal amount) thereof;



     (d) Indebtedness of the Borrower and its Restricted Subsidiaries incurred in connection with
Capital Leases;



     (e) purchase money Indebtedness of the Borrower and its Restricted Subsidiaries;



     (f) Indebtedness of a Person existing at the time such Person became a Restricted Subsidiary
or assets were acquired from such Person, to the extent such Indebtedness was not incurred in
connection with or in contemplation of, such Person becoming a Restricted Subsidiary or the
acquisition of such assets, not to exceed in the aggregate at any time outstanding $100,000,000,
and any refinancings, refundings, renewals or extensions thereof; provided that, any (i) such
refinancings, refundings, renewals or extensions do not increase the principal amount thereof, (ii)
such refinancings, refundings, renewals or extensions are issued on terms and conditions reasonably
satisfactory to the Administrative Agent (including a maturity date at least six (6) months after
the Revolving Credit Maturity Date) and (iii) no Default or Event of Default exists and is
continuing at the time of consummation thereof (both before and giving effect thereto);



75









 





     (g) Guaranty Obligations in favor of the Administrative Agent for the benefit of the
Administrative Agent and the Lenders;



     (h) Guaranty Obligations with respect to Indebtedness permitted pursuant to this Section;



     (i) Indebtedness owed by any Credit Party to another Credit Party;



     (j) Indebtedness of the Borrower or any Restricted Subsidiary consisting of Qualified Trust
Indebtedness;



     (k) unsecured Indebtedness of the Borrower and its Restricted Subsidiaries pursuant to each of
the Senior Unsecured Notes, and, in each case, any refinancings, refundings, renewals, extensions
or exchanges thereof (“Refinancing Indebtedness”); provided that (i) such
Refinancing Indebtedness is an original aggregate principal amount not greater than the aggregate
principal amount of, and unpaid interest on, the Indebtedness being refinanced, refunded, renewed,
extended or exchanged plus the amount of any premiums required to be paid thereon and fees and
expense associated therewith, (ii) such Refinancing Indebtedness has a later or equal final
maturity and a larger or equal weighted average life than the Indebtedness being refinanced,
refunded, renewed, extended or exchanged, (iii) the covenants, events of default and any Guaranty
Obligations in respect thereof, taken as a whole, shall not be materially less favorable to the
Borrower and its Restricted Subsidiaries (as determined by the Administrative Agent in its
reasonable discretion) than those contained in the Indebtedness being refinanced, refunded,
renewed, extended or exchanged and (iv) at the time of, and after giving effect to, such
refinancing, refunding, renewal, extension or exchange, no Default or Event of Default shall have
occurred and be continuing;



     (l) additional unsecured Indebtedness of the Borrower or its Restricted Subsidiaries;
provided that (i) such Indebtedness matures at least six (6) months after the Revolving
Credit Maturity Date, (ii) after giving effect to the incurrence of any such Indebtedness on a
pro forma basis, as if such incurrence of Indebtedness had occurred on the first
day of the twelve month period ending on the last day of the Borrower’s then most recently
completed fiscal quarter, the Borrower and its Restricted Subsidiaries would have been in
compliance with all the financial covenants set forth in Article IX, and the Borrower shall
have delivered to the Administrative Agent a certificate of its chief financial officer to such
effect setting forth in reasonable detail the computations necessary to determine such compliance,
(iii) at the time of the incurrence of such Indebtedness and after giving effect thereto, no
Default or Event of Default shall exist or be continuing and (iv) the documentation governing such
Indebtedness contains customary market terms;



     (m) additional secured Indebtedness not otherwise permitted pursuant to this Section in an
aggregate amount outstanding not to exceed an amount equal to ten percent (10%) of Consolidated
Tangible Assets, determined, with respect to each incurrence of Indebtedness pursuant to this
Section 10.1(m), as of the most recently-ended fiscal quarter for which financial
statements have been furnished pursuant to clauses (a) and (b), respectively, of Section
7.1 (it being understood that this Section 10.1(m) is a limitation on such Indebtedness
on a prospective basis only and that no Default or Event of Default shall occur under this
Section 10.1(m)



76









 




retroactively); provided that (i) not more than $150,000,000 of such secured
Indebtedness is recourse to any Credit Party, (ii) such Indebtedness matures at least six (6)
months after the Revolving Credit Maturity Date and (iii) at the time of the incurrence of such
Indebtedness and after giving effect thereto, no Default or Event of Default shall exist or be
continuing;




     (n) Indebtedness incurred by the Borrower or any of its Restricted Subsidiaries, including
Indebtedness represented by letters of credit for the account of the Borrower or any Restricted
Subsidiary, in respect of workers’ compensation claims, self-insurance obligations, performance,
proposal, completion, surety and similar bonds and completion guarantees provided by the Borrower
or its Restricted Subsidiaries in the ordinary course of business; provided that the underlying
obligation to perform is that of the Borrower or one of its Restricted Subsidiaries and not that of
any other Person and, provided, further, that such underlying obligation is not in respect of
borrowed money;



     (o) Indebtedness of the Borrower consisting of customary indemnification, deferred purchase
price adjustments or similar obligations, in each case, incurred or assumed in connection with the
acquisition of any business or assets permitted to be acquired hereunder; and



     (p) Indebtedness of the Borrower or any Restricted Subsidiary arising from the honoring by a
bank or other financial institution of a check, draft or similar instrument (except in the case of
daylight overdrafts) drawn against insufficient funds in the ordinary course of business, provided
that such Indebtedness is extinguished within five (5) Business Days of incurrence.



     SECTION 10.2 Limitations on Liens. Create, incur, assume or suffer to exist, any Lien
on or with respect to any of its assets or properties (including, without limitation, shares of
Capital Stock), real or personal, whether now owned or hereafter acquired, except:



     (a) Liens for taxes, assessments or governmental charges or claims that are not yet delinquent
or that are being contested in good faith by appropriate proceedings promptly instituted and
diligently pursued; provided that any reserve or other appropriate provision as is required
in conformity with GAAP has been made therefor;



     (b) Liens or deposits to secure the performance of statutory obligations, surety or appeal
bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of
business;



     (c) Liens consisting of judgments or judicial attachment liens (including prejudgment
attachment), provided that the enforcement of such Liens is effectively stayed, or payment of which
is covered in full (subject to customary deductible) by insurance, or that do not otherwise result
in an Event of Default;



     (d) the claims of materialmen, mechanics, carriers, warehousemen, processors or landlords for
labor, materials, supplies or rentals incurred in the ordinary course of business, (i) that are not
overdue for a period of more than thirty (30) days or (ii) that are being contested in good faith
and by appropriate proceedings if adequate reserves are maintained to the extent required by GAAP;



77









 





     (e) Liens consisting of (i) deposits or pledges made in the ordinary course of business in
connection with, or to secure payment of, obligations under workers’ compensation, unemployment
insurance or similar legislation, (ii) good faith deposits in connection with bids, tenders,
contracts (other than for the payment of Indebtedness) or leases to which the Borrower or any
Restricted Subsidiary is a party or (iii) deposits as security for contested taxes or import or
customs duties or for the payment of rent, incurred in the ordinary course of business;



     (f) Liens constituting encumbrances in the nature of zoning restrictions, easements and rights
or restrictions of record on the use of real property that in the aggregate are not substantial in
amount and that do not, in any case, materially detract from the value of such property or
materially impair the use thereof in the ordinary conduct of business;



     (g) Liens securing Hedging Obligations so long as the related Indebtedness was incurred in
compliance with Section 10.1(b);



     (h) leases and subleases of real property that do not materially interfere with the ordinary
conduct of the business of the Borrower or any of its Restricted Subsidiaries;



     (i) Liens of the Administrative Agent for the benefit of the Administrative Agent and the
Lenders under the Loan Documents;



     (j) Liens existing on any asset of any Person at the time such Person becomes a Restricted
Subsidiary or is merged or consolidated with or into a Restricted Subsidiary (i) that were not
created in contemplation of or in connection with such event, (ii) that do not extend to or cover
any other property or assets of Borrower or any Restricted Subsidiary and (iii) so long as any
Indebtedness related to any such Liens is permitted under Section 10.1(f); provided
that, to the extent any such Liens extend to or cover any assets of such Person included in the
Collateral, (A) the Borrower shall keep records for the accounts receivable of such Person separate
from those of the Borrower and its Restricted Subsidiaries and (B) such Person shall not be merged,
consolidated or liquidated with or into the Borrower or any Restricted Subsidiary unless such Liens
are released in connection therewith;



     (k) Liens arising solely by virtue of any statutory or common law provisions relating to
banker’s liens, rights of set-off or similar rights and remedies as to deposit accounts or other
funds maintained with a credit or depository institution;



     (l) Liens in existence on the Closing Date and described on Schedule 10.2;



     (m) Liens securing Indebtedness permitted under Sections 10.1(d) and (e);
provided that (i) such Liens shall be created substantially simultaneously with the
acquisition or lease of the related asset, (ii) such Liens do not at any time encumber any assets
other than the assets financed by such Indebtedness, (iii) the amount of Indebtedness secured
thereby is not increased and (iv) the principal amount of Indebtedness secured by any such Lien
shall at no time exceed one hundred percent (100%) of the original purchase price or lease payment
amount of such assets at the time of acquisition;



     (n) Liens securing Indebtedness permitted under Section 10.1(m); provided that
(i) the total Asset Lien Value of assets of the Borrower and its Restricted Subsidiaries owned on
the



78









 




Closing Date that are subject to such Liens shall not exceed (A) an amount equal to ten
percent (10%) of Consolidated Tangible Assets determined as of the end of the fiscal quarter ended
immediately prior to the Closing Date less (B) the aggregate amount of all Asset
Dispositions made pursuant to Section 10.4(k), and (ii) the total Asset Lien Value subject
to such Liens (including those permitted by clause (i) of this proviso) shall not exceed, in the
aggregate, an amount equal to ten percent (10%) of Consolidated Tangible Assets determined as of
the most recently-ended fiscal quarter for which financial statements have been furnished pursuant
to clauses (a) and (b), respectively, of Section 7.1; provided further that
compliance with this Section 10.2(n) shall be determined, in each case, as of the date a
Lien is incurred in reliance on this Section 10.2(n) (it being understood that this
Section 10.2(n) is a limitation on such Liens on a prospective basis only and that no
Default or Event of Default shall occur under this Section 10.2(n) retroactively);




     (o) Liens on the Capital Stock of Agecroft to secure the obligations of Agecroft;



     (p) Liens in favor of the Borrower or the Subsidiary Guarantors; and



     (q) Liens on the Capital Stock of Unrestricted Subsidiaries.



     SECTION 10.3 Limitations on Mergers and Liquidation. Merge, consolidate or enter into
any similar combination with any other Person or liquidate, wind-up or dissolve itself (or suffer
any liquidation or dissolution) except:



     (a) any Person may be merged or consolidated with or into the Borrower; provided that
the Borrower shall be the continuing or surviving Person;



     (b) any Person other than the Borrower may be merged with or consolidated into any Restricted
Subsidiary; provided that such Restricted Subsidiary shall be the continuing or surviving
Person; 



     (c) any Subsidiary of the Borrower may be liquidated, wound-up and/or dissolved into the
Borrower or any Restricted Subsidiary to the extent that such liquidation, winding-up and/or
dissolution would not violate Section 8.1; and



     (d) any Subsidiary of the Borrower may merge into the Person such Subsidiary was formed to
acquire in connection with a Permitted Acquisition.



     SECTION 10.4 Limitations on Asset Dispositions. Make any Asset Disposition
(including, without limitation, the sale of any receivables and leasehold interests and any
sale-leaseback or similar transaction) except:



     (a) the sale or lease of equipment, inventory or other assets in the ordinary course of
business;



     (b) the sale of obsolete, worn-out or surplus assets no longer used or usable in the business
of the Borrower or any of its Restricted Subsidiaries;



79









 





     (c) any Subsidiary of the Borrower may sell, lease, transfer or otherwise dispose of any or
all of its assets (upon voluntary liquidation or otherwise) to the Borrower or any other Subsidiary
of the Borrower; provided that if the transferor in such a transaction is a Restricted
Subsidiary, then the transferee must either be the Borrower or a Restricted Subsidiary;



     (d) the sale or other disposition of investments permitted pursuant to clause (b) of the
definition of Permitted Investments;



     (e) the sale or discount without recourse of accounts receivable arising in the ordinary
course of business in connection with the compromise or collection thereof;



     (f) the disposition of any Hedging Agreement;



     (g) the sale (i) for cash or Purchase Notes by the Borrower or any of its Restricted
Subsidiaries of Unoccupied Prison Facilities for a minimum price per bed of $25,000, (ii) for cash
of other Prison Facilities having a fair market value not to exceed $45,000,000 in the aggregate in
any Fiscal Year, and (iii) for cash of any Prison Facility to the United States Bureau of Prisons
or any other federal, state or local governmental agency in connection with a management contract
with such entity with respect to such Prison Facility, such Asset Disposition to be for fair market
value, as determined in good faith by the board of directors of the Borrower and certified in
writing by the board of directors to the Administrative Agent;



     (h) any sale or other disposition for cash of Purchase Notes for fair market value;



     (i) the sale and leaseback of Unoccupied Prison Facilities to Governmental Authorities in
connection with management contracts relating thereto; provided that the gross cash
proceeds of such sale and leaseback transaction are at least equal to the fair market value, as
determined in good faith by the Borrower, of such Unoccupied Prison Facility that is the subject of
that sale and leaseback transaction and such transaction is otherwise on terms and conditions
reasonably satisfactory to the Administrative Agent;



     (j) Asset Swaps; provided that (i) the Borrower would, at the time of such Asset Swap
and after giving pro forma effect thereto as if such Asset Swap had been made at
the beginning of the applicable four-fiscal quarter period, have been permitted to incur at least
$1.00 of additional Indebtedness without declining below a Consolidated Fixed Charge Coverage Ratio
of 2.0 to 1.0 for the Borrower’s most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such Asset Swap is to
made and (ii) the board of directors of the Borrower determines that the fair market value of the
assets received by the Borrower in the Asset Swap is not less than the fair market value of the
assets disposed of by the Borrower in such Asset Swap and such determination is evidenced by a
resolution of the board of directors of the Borrower set forth in an officer’s certificate
delivered to the Administrative Agent, in form and substance satisfactory to the Administrative
Agent;



     (k) Asset Dispositions of assets owned by the Borrower and its Restricted Subsidiaries on the
Closing Date, not otherwise permitted pursuant to this Section, in an aggregate amount not to
exceed (i) an amount equal to ten percent (10%) of Consolidated Tangible Assets determined as of
the end of the fiscal quarter ended immediately prior to the Closing Date less (ii) the aggregate
amounts of Liens incurred pursuant to Section 10.2(n) that



80









 




are subject to clause (i) of the proviso of such Section (after giving effect to any Liens
that are released in connection with such Asset Dispositions); provided that compliance
with this Section 10.4(k) shall be determined, in each case, as of the date an Asset
Disposition is made in reliance on this Section 10.4(k) (it being understood that this
Section 10.4(k) is a limitation on such Asset Dispositions on a prospective basis only and
that no Default or Event of Default shall occur under this Section 10.4(k) retroactively);




     (l) the sale by CCA (U.K.) Ltd, a U.K. corporation, of its interest in Agecroft;



     (m) the sale or other disposition by the Borrower of its interest in the Agecroft Note;



     (n) sales or other dispositions permitted pursuant to Section 10.5;



     (o) Asset Dispositions not otherwise permitted pursuant to this Section in an aggregate amount
not to exceed $20,000,000 in any Fiscal Year; and



     (p) additional Asset Dispositions of assets acquired by the Borrower and its Restricted
Subsidiaries after the Closing Date and Designated Assets, subject to the terms and conditions set
forth below:



          (i) the Borrower (or the Restricted Subsidiary, as the case may be) receives consideration at
the time of the Asset Disposition at least equal to (A) the fair market value of the assets (other
than Designated Assets) sold or otherwise disposed of or (B) the Designated Asset Value of the
Designated Assets sold or otherwise disposed of;




          (ii) the fair market value or Designated Asset Value, as applicable, is determined by the
board of directors of the Borrower and evidenced by a resolution of such board of directors set
forth in an officer’s certificate delivered to the Administrative Agent, in form and substance
reasonably satisfactory to the Administrative Agent; and




          (iii) at least 75% of the consideration received in the Asset Disposition by the Borrower or
such Restricted Subsidiary is in the form of cash or Cash Equivalents. For purposes of this clause
(iii) only, each of the following will be deemed to be cash:





     (A) any liabilities, as shown on the Borrower’s or such Restricted Subsidiary’s
most recent balance sheet, of the Borrower or any Restricted Subsidiary (other than
contingent liabilities and liabilities that are by their terms subordinated to this
Agreement) that are assumed by the transferee of any such assets pursuant to a
customary novation agreement that releases the Borrower or such Restricted
Subsidiary from further liability;




     (B) any securities, notes or other obligations received by the Borrower or any
such Restricted Subsidiary from such transferee that are converted within ninety
(90) days of the applicable Asset Disposition by the Borrower or such Restricted
Subsidiary into cash or Cash Equivalents, to the extent of the cash or Cash
Equivalents received in that conversion;



81









 






     (C) 100% of the securities, notes or other obligations or Indebtedness actually
received by the Borrower as consideration for the sale or other disposition of a
Designated Asset pursuant to the terms of a Designated Asset Contract, but only to
the extent that such securities, notes or other obligations or Indebtedness were
explicitly required to be included, or permitted to be included solely at the option
of the purchaser, in such consideration pursuant to the terms of the applicable
Designated Asset Contract;




     (D) 100% of the Indebtedness actually received by the Borrower as consideration
for the sale or other disposition of an Unoccupied Prison Facility; and




     (E) any Designated Non-Cash Consideration received by the Borrower or any such
Restricted Subsidiary in the Asset Disposition;


provided, however, that within 360 days after the receipt of any Net Proceeds from
an Asset Disposition permitted pursuant to this Section 10.4(p), the Borrower may apply the
Net Proceeds from such Asset Disposition:





     (1) to acquire all or substantially all of the assets of, or a majority of the Capital
Stock of, another Permitted Business;




     (2) to make a capital expenditure (provided, that the completion of (i)
construction of new facilities, (ii) expansions to existing facilities, and (iii) repair or
reconstruction of damaged or destroyed facilities that commences within 360 days after the
receipt of any Net Proceeds from an Asset Disposition may extend for an additional 360 day
period if the Net Proceeds to be used for such construction, expansion or repair are
committed to and set aside specifically for such activity within 360 days of their receipt);
or




     (3) to acquire other long-term assets that are used or useful in a Permitted Business.



     Pending the final application of any Net Proceeds, the Borrower may use the Net Proceeds to
pay Loans or invest the Net Proceeds in any Permitted Investment. Any Net Proceeds from Asset
Dispositions that are not applied or invested as provided in the preceding proviso to this
Section 10.4(p) shall constitute “Excess Proceeds.” Within five (5) days of each
date on which the aggregate amount of Excess Proceeds exceeds $15,000,000, the Borrower shall apply
all the Excess Proceeds to prepay the Loans in the manner set forth in Section 2.4(b),
without a corresponding permanent reduction in the Revolving Credit Commitment. If any Excess
Proceeds remain after such prepayment of the Loans, the Borrower shall offer to purchase Senior
Unsecured Notes with such remaining Excess Proceeds pursuant to the terms and conditions of the
Senior Unsecured Notes. Upon application of the Excess Proceeds to prepay the Loans and prepay the
Senior Unsecured Notes, the amount of Excess Proceeds shall be reset at zero.



     SECTION 10.5 Restricted Payments. (a) Declare or pay any dividend or make any other
payment or distribution on account of the Borrower’s, or any Restricted Subsidiary’s,



82









 




Capital Stock (including, without limitation, any payment in connection with any merger or
consolidation involving the Borrower or any Restricted Subsidiary) or to the direct or indirect
holders of the Borrower’s or any Restricted Subsidiary’s Capital Stock in their capacity as such
(other than dividends or distributions (i) payable in Capital Stock (other than Disqualified Stock)
of the Borrower or (ii) payable to the Borrower and/or a Restricted Subsidiary of the Borrower),
(b) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in
connection with any merger or consolidation involving the Borrower) any Capital Stock of the
Borrower, (c) make any payment on or with respect to, or purchase, redeem, defease or otherwise
acquire or retire for value any Subordinated Indebtedness, except a payment of interest or
principal at the Stated Maturity thereof or a payment of principal or interest on Indebtedness owed
to the Borrower or any of its Restricted Subsidiaries, or (d) make any Restricted Investment (all
such payments and other actions set forth in these clauses (a) through (d) above being collectively
referred to as “Restricted Payments”);




     unless, at the time of and after giving effect to such Restricted Payment:



     (a) no Default or Event of Default has occurred and is continuing or would occur as a
consequence of such Restricted Payment;



     (b) the Borrower would, at the time of such Restricted Payment and after giving pro
forma effect thereto as if such Restricted Payment had been made at the beginning of the
applicable four-fiscal quarter period, have been permitted to incur at least $1.00 of additional
Indebtedness without declining below a Consolidated Fixed Charge Coverage Ratio of 2.0 to 1.0 for
the Borrower’s most recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date on which such Restricted Payment is to
made; and



     (c) such Restricted Payment, together with the aggregate amount of all other Restricted
Payments made by the Borrower and its Restricted Subsidiaries after May 3, 2002 (excluding
Restricted Payments permitted by clauses (b), (c), (d), (e), (g), (h) and (i) of the next
succeeding paragraph), is less than the sum, without duplication, of:



          (i) 50% of the Consolidated Net Income of the Borrower, for the period (taken as one
accounting period) from the beginning of the first fiscal quarter commencing after May 3, 2002 to
the end of the Borrower’s most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, if such Consolidated Net
Income for such period is a deficit, less 100% of such deficit), plus




          (ii) 100% of the aggregate net cash proceeds received by the Borrower (including the fair
market value of any Permitted Business or assets used or useful in a Permitted Business to the
extent acquired in consideration of Capital Stock of the Borrower (other than Disqualified Stock))
since May 3, 2002 as a contribution to its common equity capital or from the issue or sale of
Capital Stock of the Borrower (other than Disqualified Stock) or from the issue or sale of
convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities of
the Borrower that have been converted into or exchanged for such Capital Stock (other than Capital
Stock (or Disqualified Stock or debt securities) sold to a Subsidiary of the Borrower),
plus




83









 








          (iii) to the extent that any Restricted Investment (other than a Restricted Investment
permitted by clause (e) of the next succeeding paragraph) that was made after May 3, 2002 is sold
for cash or otherwise liquidated or repaid for cash, the lesser of (i) the cash return of capital
with respect to such Restricted Investment (less the cost of disposition, if any) and (ii) the
initial amount of such Restricted Investment, plus




          (iv) to the extent that any Unrestricted Subsidiary of the Borrower is redesignated as a
Restricted Subsidiary after May 3, 2002, the lesser of (i) the fair market value of the Borrower’s
Investment in such Subsidiary as of the date of such redesignation or (ii) such fair market value
as of the date on which such Subsidiary was originally designated as an Unrestricted Subsidiary,
plus




          (v) $25,000,000.




     So long as no Default or Event of Default has occurred and is continuing or would be caused
thereby, the preceding provisions shall not prohibit:



     (a) the payment of any dividend within 60 days after the date of declaration of the dividend,
if at the date of declaration the dividend payment would have complied with the provisions of this
Agreement;



     (b) the redemption, repurchase, retirement, defeasance or other acquisition of any
subordinated Indebtedness of the Borrower or any Subsidiary Guarantor or of any Capital Stock of
the Borrower in exchange for, or out of the net cash proceeds of the substantially concurrent sale
(other than to a Subsidiary of the Borrower) of, Capital Stock of the Borrower (other than
Disqualified Stock); provided that the amount of any such net cash proceeds that are
utilized for any such redemption, repurchase, retirement, defeasance or other acquisition shall be
excluded from clause (c)(ii) of the preceding paragraph;



     (c) the defeasance, redemption, repurchase or other acquisition of subordinated Indebtedness
of the Borrower or any Subsidiary Guarantor with the net cash proceeds from an incurrence of
Permitted Refinancing Indebtedness;



     (d) (i) loans or advances from any Restricted Subsidiary to the Borrower or any of its
Restricted Subsidiaries and (ii) the payment of any dividend or the making of any other
distribution by a Restricted Subsidiary of the Borrower (x) to the Borrower or any Restricted
Subsidiary or (y) to the holders of its Capital Stock on a pro rata basis;



     (e) (i) the purchase, redemption or other acquisition, cancellation or retirement for value of
Capital Stock, or options, warrants, equity appreciation rights or other rights to purchase or
acquire Capital Stock of the Borrower or any Restricted Subsidiary of the Borrower or any parent of
the Borrower held by any existing or former employees of the Borrower or any Subsidiary of the
Borrower or their assigns, estates or heirs, in each case in connection with the repurchase
provisions under employee stock option or stock purchase agreements or other agreements to
compensate management employees; provided that such redemptions or repurchases pursuant to
this clause will not exceed $2,500,000 in the aggregate during any calendar year and $10,000,000 in
the aggregate for all such redemptions and repurchases; provided further, that the
Borrower may carry-forward and make in a subsequent calendar year,



84









 




in addition to the amounts permitted for such calendar year, the amount of such redemptions or
repurchases permitted to have been made but not made in any preceding calendar year;
provided further that such amount in any calendar year may be increased by an
amount not to exceed (x) the cash proceeds from the sale of Capital Stock of the Borrower to
existing or former employees of the Borrower or any Subsidiary of the Borrower after the Closing
Date (to the extent the cash proceeds from the sale of such Capital Stock have not otherwise been
applied to the payment of Restricted Payments by virtue of clause (c)(ii) of the preceding
paragraph) plus (y) the cash proceeds of key man life insurance policies received by the
Borrower and its Subsidiaries after the Closing Date less (z) the amount of any Restricted
Payments previously made pursuant to clause (x) and (y) of this clause (e)(i) and (ii) loans or
advances to employees or directors of the Borrower or any Subsidiary of the Borrower the proceeds
of which are used to purchase Capital Stock of the Borrower, in an aggregate amount not in excess
of $10,000,000 at any one time outstanding;




     (f) prior to the Closing Date, the declaration and payment by the Borrower of a dividend
consisting of Qualified Trust Preferred Stock with a fair market value that is not greater than is
necessary in order to preserve the Borrower’s eligibility to elect Real Estate Investment Trust
status with respect to its 1999 taxable year;



     (g) prior to the Closing Date, the repurchase, redemption or other acquisition or retirement
for value of up to $130,000,000 in liquidation preference of the Series B Preferred Stock if the
Borrower would, at the time of such Restricted Payment and after giving pro forma
effect thereto as if such Restricted Payment had been made at the beginning of the applicable
four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness without
declining below a Consolidated Fixed Charge Coverage Ratio of 2.0 to 1.0 for the Borrower’s most
recently ended four full fiscal quarters for which internal financial statements are available
immediately preceding the date on which such Restricted Payment is to made;



     (h) repurchases of Capital Stock of the Borrower deemed to occur upon the exercise of stock
options if such Capital Stock represents a portion of the exercise price thereof;



     (i) prior to the Closing Date, the declaration and payment of dividends on the Borrower’s
Series A Preferred Stock and Series B Preferred Stock in accordance with terms of the Series A
Preferred Stock and Series B Preferred Stock as in effect on May 7, 2003;



     (j) prior to the Closing Date, the payment of the liquidation preference of and all accrued
and unpaid interest on 100% of issued and outstanding shares of the Series A Preferred Stock in
accordance with the terms of the Series A Preferred Stock as in effect on the Closing Date and the
notice of redemption to be given by the Borrower on May 7, 2003;



     (k) prior to the Closing Date, the redemption pursuant to their terms of all PMI Notes that
remain outstanding on the applicable redemption date after the Borrower sends notice of such
redemption to the holders of such notes, provided that (i) the Borrower converts all PMI
Notes pursuant to their terms upon the proper request of a holder of such notes and (ii) the fair
market value of the common stock received upon such conversion (measured as of the date the notice
of redemption is given) is not less than one and one half times the proceeds such holder would
receive pursuant to such redemption;



85









 





     (l) prior to the Closing Date, the repurchase, redemption or other acquisition or retirement
for value of the shares of Series A Preferred Stock issued and outstanding on May 7, 2003 with the
net proceeds from the issuance by a Qualified Trust of Qualified Trust Preferred Stock; and



     (m) Restricted Payments not otherwise permitted in an amount not to exceed $40,000,000.



     The amount of all Restricted Payments (other than cash) shall be the fair market value on the
date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued
by the Borrower or such Subsidiary, as the case may be, pursuant to the Restricted Payment. The
fair market value of any assets or securities that are required to be valued by this Section
10.5 shall be determined by the Borrower’s board of directors, whose resolution with respect
thereto shall be delivered to the Administrative Agent. The Borrower’s board of directors’
determination must be based upon an opinion or appraisal issued by an accounting, appraisal or
investment banking firm of national standing if the fair market value exceeds $15,000,000. Except
with respect to any Restricted Payment permitted pursuant to clauses (a) — (m) of the immediately
preceding paragraph, not later than ten (10) days following the end of the fiscal quarter in which
such Restricted Payment was made, the Borrower shall deliver to the Administrative Agent an
officer’s certificate, in form reasonably satisfactory to the Administrative Agent, stating that
such Restricted Payment is permitted and setting forth the basis upon which the calculations
required by this Section 10.5 were calculated.



     SECTION 10.6 Limitations on Exchange and Issuance of Disqualified Stock. Issue, sell
or otherwise dispose of any class or series of Disqualified Stock.



     SECTION 10.7 Transactions with Affiliates. Directly or indirectly (a) make any loan
or advance to, or purchase or assume any note or other obligation to or from, any of its officers,
directors, shareholders or other Affiliates, or to or from any member of the immediate family of
any of its officers, directors, shareholders or other Affiliates, or subcontract any operations to
any of its Affiliates or (b) enter into, or be a party to, any other transaction not described in
clause (a) above with any of its Affiliates other than:



          (i) transactions permitted by Sections 10.1, 10.2, 10.3, 10.4,
10.5, and 10.6;




          (ii) transactions existing on the Closing Date and described on Schedule 10.7;




          (iii) normal compensation and reimbursement of reasonable expenses of officers and directors;
Subsidiaries;




          (iv) transactions between or among the Borrower and/or its Restricted Subsidiaries;




          (v) any issuance of securities, or other payments, awards or grants in cash, securities or
otherwise pursuant to, or the funding of employment arrangements, stock options and stock ownership
plans and other reasonable fees, compensation, benefits and indemnities paid or entered into by the
Borrower or any of its Restricted Subsidiaries in the ordinary course



86









 






of business to or with officers, directors or employees of the Borrower and its Restricted
Subsidiaries; and




          (vi) other transactions (including, without limitation, employment agreements and indemnity
agreements) in the ordinary course of business on terms as favorable as would be obtained by it on
a comparable arms-length transaction with an independent, unrelated third party, as determined in
good faith by the board of directors of the Borrower.




     SECTION 10.8 Certain Accounting Changes; Organizational Documents. (a) Change its
Fiscal Year end, or make any change in its accounting treatment and reporting practices except as
required by GAAP or (b) except pursuant to a transaction permitted by Section 10.3, amend,
modify or change its articles of incorporation (or corporate charter or other similar
organizational documents) or bylaws (or other similar documents) in any manner adverse in any
respect to the rights or interests of the Lenders hereunder.



     SECTION 10.9 Amendments; Payments and Prepayments of Material Indebtedness.



     (a) Amend or modify (or permit the modification or amendment of) any of the terms or
provisions of any Material Indebtedness (including, without limitation, the Senior Unsecured Notes)
in any respect that would materially adversely affect the rights or interests of the Administrative
Agent and Lenders hereunder.



     (b) Make or offer to make any optional or voluntary payment, prepayment, repurchase or
redemption of, or otherwise voluntarily or optionally defease, any Material Indebtedness, or
segregate funds for any such payment, prepayment, repurchase, redemption or defeasance (including,
without limitation, (i) by way of depositing with any trustee with respect thereto money or
securities before due for the purpose of paying when due and (ii) at the maturity thereof), other
than the prepayment of Material Indebtedness permitted hereunder (including, without limitation, as
otherwise permitted pursuant to Section 10.5); provided, however, that (A)
the Borrower may make optional or voluntary payments on any Senior Unsecured Note so long as the
Borrower has demonstrated that the pro forma Consolidated Total Leverage Ratio is
less than 4.75 to 1.00 as of the date of any such payment and after giving effect thereto and (B)
the Borrower and its Restricted Subsidiaries may make optional or voluntary payments or prepayments
of any intercompany Indebtedness incurred pursuant to Section 10.1(i).



     SECTION 10.10 Restrictive Agreements.



     (a) Enter into any Indebtedness (other than the Senior Unsecured Notes) that contains any
negative pledge on assets or that restricts, limits or otherwise encumbers its ability to incur
Liens on or with respect to any of its assets or properties other than the assets or properties
securing such Indebtedness.



     (b) Enter into or permit to exist any agreement (other than the Senior Unsecured Notes) that
impairs or limits the ability of any Restricted Subsidiary of the Borrower to pay dividends to the
Borrower.



87









 





     SECTION 10.11 Nature of Business. Engage in any business other than a Permitted
Business.



     SECTION 10.12 Impairment of Security Interests. Take or omit to take any action that
would have the result of materially impairing the security interests in favor of the Administrative
Agent with respect to the Collateral.



     SECTION 10.13 Use of Proceeds. Use the proceeds of the Extensions of Credit, whether
directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry
margin stock (within the meaning of Regulation T, U or X of the Board of Governors of the Federal
Reserve System) or to extend credit to others for the purpose of purchasing or carrying margin
stock or to refund indebtedness originally incurred for such purpose (except to the extent that
such purchase would not cause more than 25% of the aggregate value of the assets (either of the
Borrower only or of the Borrower and its Subsidiaries on a consolidated basis) that are subject to
the provisions of Section 10.2 or Section 10.4, or that are subject to any
restriction contained in any agreement or instrument between the Borrower and any Lender or any
Affiliate of any Lender relating to Indebtedness and within the scope of Section 11.1(g),
to consist of margin stock).



ARTICLE XI




DEFAULT AND REMEDIES




     SECTION 11.1 Events of Default. Each of the following shall constitute an Event of
Default, whatever the reason for such event and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment or order of any court or any order, rule
or regulation of any Governmental Authority or otherwise:



     (a) Default in Payment of Principal of Loans and Reimbursement Obligations. The
Borrower shall default in any payment of principal of any Loan or Reimbursement Obligation when and
as due (whether at maturity, by reason of acceleration or otherwise).



     (b) Other Payment Default. The Borrower shall default in the payment when and as due
(whether at maturity, by reason of acceleration or otherwise) of interest on any Loan or
Reimbursement Obligation or the payment of any other Obligation, and such default shall continue
for a period of three (3) Business Days.



     (c) Misrepresentation. Any representation, warranty, certification or statement of
fact made or deemed made by or on behalf of the Borrower or any other Credit Party herein, in any
other Loan Document or in any document delivered in connection herewith or therewith that is
subject to materiality or Material Adverse Effect qualifications shall be incorrect or misleading
in any respect when made or deemed made or any representation, warranty, certification or statement
of fact made or deemed made, by or on behalf of the Borrower or any other Credit Party herein, in
any other Loan Document or in any document delivered in connection herewith or therewith that is
not subject to materiality or Material Adverse Effect qualifications shall be incorrect or
misleading in any material respect when made or deemed made.



88









 





     (d) Default in Performance of Certain Covenants. The Borrower or any other Credit
Party shall default in the performance or observance of any covenant or agreement contained in
Sections 7.1 or 7.2 or Articles IX or X.



     (e) Default in Performance of Other Covenants and Conditions. The Borrower or any
other Credit Party shall default in the performance or observance of any term, covenant, condition
or agreement contained in this Agreement (except as otherwise specifically provided in this
Section) or any other Loan Document and such default shall continue for a period of thirty (30)
days after written notice thereof has been given to the Borrower by the Administrative Agent.



     (f) Hedging Agreement. The Borrower or any other Credit Party shall default in the
performance or observance of any terms, covenant, condition or agreement (after giving effect to
any applicable grace or cure period) under any Hedging Agreement and such default causes the
termination of such Hedging Agreement and the Termination Value owed by such Credit Party as a
result thereof exceeds $20,000,000.



     (g) Material Indebtedness Cross-Default. The Borrower or any other Credit Party shall
(i) default in the payment of any Material Indebtedness (other than the Loans or any Reimbursement
Obligation) beyond the period of grace if any, provided in the instrument or agreement under which
such Material Indebtedness was created, or (ii) default in the observance or performance of any
other agreement or condition relating to any Material Indebtedness (other than the Loans or any
Reimbursement Obligation) 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 holders of such Material
Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause, with the giving
of notice if required, any such Material Indebtedness to become due prior to its Stated Maturity
(any applicable grace period having expired).



     (h) Change in Control. Any Change in Control shall occur.



     (i) Voluntary Bankruptcy Proceeding. The Borrower or any Restricted Subsidiary
thereof shall (i) commence a voluntary case under the federal bankruptcy laws (as now or hereafter
in effect), (ii) file a petition seeking to take advantage of any other laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, winding up or composition or adjustment of
debts, (iii) consent to or fail to contest in a timely and appropriate manner any petition filed
against it in an involuntary case under such bankruptcy laws or other laws, (iv) apply for or
consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the
taking of possession by, a receiver, custodian, trustee, or liquidator of itself or of a
substantial part of its property, domestic or foreign, (v) admit in writing its inability to pay
its debts as they become due, (vi) make a general assignment for the benefit of creditors, or (vii)
take any corporate action for the purpose of authorizing any of the foregoing.



     (j) Involuntary Bankruptcy Proceeding. A case or other proceeding shall be commenced
against the Borrower or any Restricted Subsidiary thereof in any court of competent jurisdiction
seeking (i) relief under the federal bankruptcy laws (as now or hereafter in effect) or under any
other laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization,



89









 




winding up or composition or adjustment of debts, or (ii) the appointment of a trustee,
receiver, custodian, liquidator or the like for the Borrower or any Restricted Subsidiary thereof
or for all or any substantial part of their respective assets, domestic or foreign, and such case
or proceeding shall continue without dismissal or stay for a period of sixty (60) consecutive days,
or an order granting the relief requested in such case or proceeding (including, but not limited
to, an order for relief under such federal bankruptcy laws) shall be entered.




     (k) Failure of Agreements. Any provision of this Agreement or any provision of any
other Loan Document shall for any reason cease to be valid and binding on the Borrower or any other
Credit Party party thereto or any such Person shall so state in writing, or any Loan Document shall
for any reason cease to create a valid and perfected first priority Lien on, or security interest
in, any of the Collateral purported to be covered thereby (subject to Permitted Liens), in each
case other than in accordance with the express terms hereof or thereof.



     (l) Termination Event. The occurrence of any of the following events: (i) the
Borrower or any ERISA Affiliate fails to make full payment when due of all amounts that, under the
provisions of any Pension Plan or Section 412 of the Code, the Borrower or any ERISA Affiliate is
required to pay as contributions thereto, (ii) an accumulated funding deficiency in excess of
$20,000,000 occurs or exists, whether or not waived, with respect to any Pension Plan, (iii) a
Termination Event or (iv) the Borrower or any ERISA Affiliate as employers under one or more
Multiemployer Plans makes a complete or partial withdrawal from any such Multiemployer Plan and the
plan sponsor of such Multiemployer Plans notifies such withdrawing employer that such employer has
incurred a withdrawal liability requiring payments in an amount exceeding $20,000,000.



     (m) Judgment. A judgment or order for the payment of money that causes the aggregate
amount of all such judgments to exceed $20,000,000 in any Fiscal Year shall be entered against the
Borrower or any Credit Party by any court and such judgment or order shall continue without having
been discharged, vacated, stayed or bonded for a period of thirty (30) days after the entry
thereof.



     SECTION 11.2 Remedies. Upon the occurrence of an Event of Default, with the consent
of the Required Lenders, the Administrative Agent may, or upon the request of the Required Lenders,
the Administrative Agent shall, by notice to the Borrower:



     (a) Acceleration; Termination of Facilities. Terminate the Revolving Credit
Commitment and declare the principal of and interest on the Loans and the Reimbursement Obligations
at the time outstanding, and all other amounts owed to the Lenders and to the Administrative Agent
under this Agreement or any of the other Loan Documents (including, without limitation, all L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have
presented or shall be entitled to present the documents required thereunder) and all other
Obligations (other than Hedging Obligations), to be forthwith due and payable, whereupon the same
shall immediately become due and payable without presentment, demand, protest or other notice of
any kind, all of which are expressly waived by each Credit Party, anything in this Agreement or the
other Loan Documents to the contrary notwithstanding, and terminate the Credit Facility and any
right of the Borrower to request borrowings or Letters of Credit thereunder; provided, that
upon the occurrence of an Event of Default specified in



90









 




Section 11.1(i) or (j), the Credit Facility shall be automatically terminated
and all Obligations (other than Hedging Obligations) shall automatically become due and payable
without presentment, demand, protest or other notice of any kind, all of which are expressly waived
by each Credit Party, anything in this Agreement or in any other Loan Document to the contrary
notwithstanding;




     (b) Letters of Credit. With respect to all Letters of Credit with respect to which
presentment for honor shall not have occurred at the time of an acceleration pursuant to the
preceding paragraph (a), require that the Borrower at such time deposit in a cash collateral
account opened by the Administrative Agent an amount equal to the aggregate then undrawn and
unexpired amount of such Letters of Credit; and



     (c) Rights of Collection. Exercise on behalf of the Lenders all of its other rights
and remedies under this Agreement, the other Loan Documents and Applicable Law, in order to satisfy
all of the Borrower’s Obligations.



     SECTION 11.3 Rights and Remedies Cumulative; Non-Waiver; etc. The enumeration of the
rights and remedies of the Administrative Agent and the Lenders set forth in this Agreement is not
intended to be exhaustive and the exercise by the Administrative Agent and the Lenders of any right
or remedy shall not preclude the exercise of any other rights or remedies, all of which shall be
cumulative, and shall be in addition to any other right or remedy given hereunder or under the
other Loan Documents or that may now or hereafter exist at law or in equity or by suit or
otherwise. No delay or failure to take action on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or privilege preclude any other or further
exercise thereof or the exercise of any other right, power or privilege or shall be construed to be
a waiver of any Event of Default. No course of dealing between the Borrower, the Administrative
Agent and the Lenders or their respective agents or employees shall be effective to change, modify
or discharge any provision of this Agreement or any of the other Loan Documents or to constitute a
waiver of any Event of Default.



     SECTION 11.4 Crediting of Payments and Proceeds. In the event that the Borrower shall
fail to pay any of the Obligations when due and the Obligations have been accelerated pursuant to
Section 11.2, all payments received by the Lenders upon the Obligations and all net
proceeds from the enforcement of the Obligations shall be applied:



     First, to payment of that portion of the Obligations constituting fees, indemnities,
expenses and other amounts, including attorney fees, payable to the Administrative Agent in its
capacity as such and the applicable Issuing Lender in its capacity as such (ratably among the
Administrative Agent and the Issuing Lender in proportion to the respective amounts described in
this clause First payable to them);



     Second, to payment of that portion of the Obligations constituting fees, indemnities
and other amounts (other than principal and interest) payable to the Lenders, including attorney
fees (ratably among the Lenders in proportion to the respective amounts described in this clause
Second payable to them);



91









 





     Third, to payment of that portion of the Obligations constituting accrued and unpaid
interest on the Loans and Reimbursement Obligations and any Hedging Obligations (including any
termination payments and any accrued and unpaid interest thereon) (ratably among the Lenders in
proportion to the respective amounts described in this clause Third payable to them);



     Fourth, to payment of that portion of the Obligations constituting unpaid principal of
the Loans and Reimbursement Obligations (ratably among the Lenders in proportion to the respective
amounts described in this clause Fourth held by them);



     Fifth, to the Administrative Agent for the account of the applicable Issuing Lender,
to cash collateralize any L/C Obligations then outstanding; and



     Last, the balance, if any, after all of the Obligations have been indefeasibly paid in
full, to the Borrower or as otherwise required by Law.



     Amounts held to cash collateralize any L/C Obligations pursuant to clause Fifth above
and/or Section 11.2(b) shall be applied by the Administrative Agent to the payment of
drafts drawn under Letters of Credit with respect to which presentment for honor shall not have
occurred at the time of an acceleration pursuant to Section 11.2, and the unused portion
thereof after all such Letters of Credit shall have expired or been fully drawn upon, if any, shall
be applied to repay the other Obligations, if any, in the order set forth above.



     SECTION 11.5 Administrative Agent May File Proofs of Claim. In case of the pendency
of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to any Credit Party, the Administrative Agent
(irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable
as herein expressed or by declaration or otherwise and irrespective of whether the Administrative
Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention
in such proceeding or otherwise:



     (a) to file and prove a claim for the whole amount of the principal and interest owing and
unpaid in respect of the Loans, L/C Obligations and all other Obligations that are owing and unpaid
and to file such other documents as may be necessary or advisable in order to have the claims of
the Lenders and the Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Lenders and the Administrative Agent and their
respective agents and counsel and all other amounts due the Lenders and the Administrative Agent
under Sections 3.3, 4.3 and 13.3) allowed in such judicial proceeding; and



     (b) to collect and receive any monies or other property payable or deliverable on any such
claims and to distribute the same;


and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender to make such payments to the
Administrative Agent and, in the event that the Administrative Agent shall consent to the making of
such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its
agents and counsel, and any other amounts due the Administrative Agent under Sections 4.3
and 13.3.




92









 








     Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or
consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement,
adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.



ARTICLE XII




THE ADMINISTRATIVE AGENT




     SECTION 12.1 Appointment and Authority. Each of the Lenders and each Issuing Lender
hereby irrevocably appoints Bank of America 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 Article are solely for the benefit of the Administrative Agent,
the Lenders and the Issuing Lenders, and neither the Borrower nor any Restricted Subsidiary thereof
shall have rights as a third party beneficiary of any of such provisions.



     SECTION 12.2 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 Restricted 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.



     SECTION 12.3 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:



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



     (b) shall not have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan
Documents that the Administrative Agent is required to exercise as directed in writing by the
Required Lenders (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




93












 





     (c) shall not, except as expressly set forth herein and in the other Loan Documents, have any
duty to disclose, and shall not be liable for the failure to disclose, any information relating to
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 Section 13.2 and Section 11.2) or
(ii) in the absence of its own gross negligence or willful misconduct as determined by a court of
competent jurisdiction by final nonappealable judgment. The Administrative Agent shall be deemed
not to have knowledge of any Default unless and until notice describing such Default is given to
the Administrative Agent by the Borrower, a Lender or the Issuing Lenders.



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



     SECTION 12.4 Reliance by the Administrative Agent. The Administrative Agent shall be
entitled to rely upon, and shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, 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
applicable Issuing Lender, the Administrative Agent may presume that such condition is satisfactory
to such Lender or such Issuing Lender unless the Administrative Agent shall have received notice to
the contrary from such Lender or such 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.



     SECTION 12.5 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



94









 




of this Article shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as well as activities
as Administrative Agent.




     SECTION 12.6 Resignation of Administrative Agent.



     (a) The Administrative Agent may at any time give notice of its resignation to the Lenders,
the Issuing Lenders and the Borrower. Upon receipt of any such notice of resignation, the Required
Lenders shall have the right, in consultation with the Borrower, to appoint a successor, which
shall be a bank with an office in the United States, or an Affiliate of any such bank with an
office in the United States. If no such successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within 30 days after the retiring Administrative
Agent gives notice of its resignation, then the retiring Administrative Agent may on behalf of the
Lenders and the Issuing Lenders, appoint a successor Administrative Agent meeting the
qualifications set forth above provided that if the Administrative Agent shall notify the Borrower
and the Lenders that no qualifying Person has accepted such appointment, then such resignation
shall nonetheless become effective in accordance with such notice and (1) 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 Lenders 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 (2) 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 each Issuing Lender directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this paragraph. 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 paragraph). 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 Article and Section 13.3 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.



     (b) Any resignation by Bank of America as Administrative Agent pursuant to this Section shall
also constitute its resignation as an Issuing Lender and Swingline Lender. Upon the acceptance of
a successor’s appointment as Administrative Agent hereunder, (a) such successor shall succeed to
and become vested with all of the rights, powers, privileges and duties of as an Issuing Lender, if
applicable, and as Swingline Lender, (b) the retiring Issuing Lender and Swingline Lender shall be
discharged from all of their respective duties and obligations hereunder or under the other Loan
Documents, and (c) the successor Issuing Lender shall issue letters of credit in substitution for
the Letters of Credit, if any, outstanding at the time of such



95









 




succession or make other arrangement satisfactory to Bank of America, as a retiring Issuing
Lender to effectively assume the obligations of the retiring Issuing Lender with respect to Letters
of Credit issued thereby.




     SECTION 12.7 Non-Reliance on Administrative Agent and Other Lenders. Each Lender and
each 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 each 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.



     SECTION 12.8 No Other Duties, etc. Anything herein to the contrary notwithstanding,
none of the syndication agents, documentation agents, co-agents, book manager, lead manager,
arranger, lead arranger or co-arranger listed on the cover page or signature pages 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 an
Issuing Lender hereunder.



     SECTION 12.9 Collateral and Guaranty Matters. The Lenders irrevocably authorize the
Administrative Agent, at its option and in its discretion,



     (a) to release any Lien on any Collateral granted to or held by the Administrative Agent under
any Loan Document (i) upon repayment of the outstanding principal of and all accrued interest on
the Loans, payment of all outstanding fees and expenses hereunder, the termination of the Revolving
Credit Commitment and the expiration or termination of all Letters of Credit, (ii) that is sold or
to be sold as part of or in connection with any sale, disposition or other transaction permitted
hereunder or under any other Loan Document, or (iii) subject to Section 13.2, if approved,
authorized or ratified in writing by the Required Lenders;



     (b) to subordinate or release any Lien on any Collateral granted to or held by the
Administrative Agent under any Loan Document to the holder of any Permitted Lien (except Permitted
Liens permitted solely by Section 10.2(n)); and



     (c) to release any Subsidiary Guarantor from its obligations under the Subsidiary Guaranty
Agreement, the Collateral Agreement and any other Security Documents if such Person ceases to be a
Restricted Subsidiary as a result of a transaction permitted hereunder.



     Upon request by the Administrative Agent at any time, the Required Lenders will confirm in
writing the Administrative Agent’s authority to release or subordinate its interest in particular
types or items of property, or to release any Subsidiary Guarantor from its obligations under the
Subsidiary Guaranty Agreement pursuant to this Section.



96









 





ARTICLE XIII




MISCELLANEOUS




     SECTION 13.1 Notices.



     (a) Method of Communication. Except as otherwise provided in this Agreement, all
notices and communications hereunder shall be in writing (for purposes hereof, the term “writing”
shall include information in electronic format such as electronic mail and internet web pages), or
by telephone subsequently confirmed in writing. Any notice shall be effective if delivered by hand
delivery or sent via electronic mail, posting on an internet web page, telecopy, recognized
overnight courier service or certified mail, return receipt requested, and shall be presumed to be
received by a party hereto (i) on the date of delivery if delivered by hand or sent by electronic
mail, posting on an internet web page or telecopy, (ii) on the next Business Day if sent by
recognized overnight courier service and (iii) on the third Business Day following the date sent by
certified mail, return receipt requested. A telephonic notice to the Administrative Agent as
understood by the Administrative Agent will be deemed to be the controlling and proper notice in
the event of a discrepancy with or failure to receive a confirming written notice.



     (b) Addresses for Notices. Notices to any party shall be sent to it at the following
addresses, or any other address as to which all the other parties are notified in writing.



	 	 	 	 	 	 	 	 	 
	 

	 	If to the Borrower:
	 	 	 	Corrections Corporation of America

10 Burton Hills Boulevard, Suite 100

Nashville, Tennessee 37215

Attention: Chief Financial Officer

Telephone No.: (615) 263-3131

Telecopy No.: (615) 263-3010
	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	With copies to:
	 	 	 	Bass, Berry & Sims PLC

315 Deaderick Street, Suite 2700

Nashville, Tennessee 37238

Attention: James S. Tate, Jr.

Telephone No.: (615) 742-6200

Telecopy No.: (615) 742-6293	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	If to Bank of America as

Administrative Agent:
	 	 	 	Bank of America, N.A.

Mail Code: IL1-231-10-41

231 South LaSalle Street

Chicago, Illinois 60604

Attention: Agency Management

Telephone No.: (312) 828-3185

Telecopy No.: (877) 207-2382	 	 






97









 






	 	 	 	 	 	 	 	 	 
	 

	 	With copies to:
	 	 	 	Bank of America, N.A.

Mail Code: MD9-978-04-01

1101 Wooton Parkway

Rockville, Maryland 20852

Attention: Barbara P. Levy

Telephone No.: (301) 517-3128

Telecopy No.: (804) 553-2394	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	If to any Lender:
	 	 	 	To the address set forth on the Register	 	 






     (c) Administrative Agent’s Office. The Administrative Agent hereby designates its
office located at the address set forth above, or any subsequent office that shall have been
specified for such purpose by written notice to the Borrower and Lenders, as the Administrative
Agent’s Office referred to herein, to which payments due are to be made and at which Loans will be
disbursed and Letters of Credit requested.



     SECTION 13.2 Amendments, Waivers and Consents. Except as set forth below or as
specifically provided in any Loan Document, any term, covenant, agreement or condition of this
Agreement or any of the other Loan Documents may be amended or waived by the Lenders, and any
consent given by the Lenders, if, but only if, such amendment, waiver or consent is in writing
signed by the Required Lenders (or by the Administrative Agent with the consent of the Required
Lenders) and delivered to the Administrative Agent and, in the case of an amendment, signed by the
Borrower; provided, that no amendment, waiver or consent shall:



     (a) waive any condition set forth in Section 5.1 without the written consent of each
Lender directly affected thereby;



     (b) extend or increase the Revolving Credit Commitment of any Lender (or reinstate any
Revolving Credit Commitment terminated pursuant to Section 11.2) or the amount of Loans of
any Lender without the written consent of such Lender;



     (c) postpone any date fixed by this Agreement or any other Loan Document for any payment of
principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under
any other Loan Document without the written consent of each Lender directly affected thereby;



     (d) reduce the principal of, or the rate of interest specified herein on, any Loan or
Reimbursement Obligation, or (subject to clause (iv) of the second proviso to this Section) any
fees or other amounts payable hereunder or under any other Loan Document without the written
consent of each Lender directly affected thereby; provided that only the consent of the
Required Lenders shall be necessary (i) to waive any obligation of the Borrower to pay interest at
the rate set forth in Section 4.1(c) during the continuance of an Event of Default, or (ii)
to amend any financial covenant hereunder (or any defined term used therein) even if the effect of
such amendment would be to reduce the rate of interest on any Loan or L/C Borrowing or to reduce
any fee payable hereunder;



98









 





     (e) change Section 4.4 or Section 11.4 in a manner that would alter the
pro rata sharing of payments required thereby without the written consent of each
Lender directly affected thereby;



     (f) change any provision of this Section or the definition of “Required Lenders” or any other
provision hereof specifying the number or percentage of Lenders required to amend, waive or
otherwise modify any rights hereunder or make any determination or grant any consent hereunder,
without the written consent of each Lender directly affected thereby;



     (g) release all of the Subsidiary Guarantors or release Subsidiary Guarantors comprising
substantially all of the credit support for the Obligations, in either case, from the Subsidiary
Guaranty Agreement (other than as authorized in Section 12.9), without the written consent
of each Lender; or



     (h) release all or a material portion of the Collateral or release any Security Document
(other than as authorized in Section 12.9 or as otherwise specifically permitted or
contemplated in this Agreement or the applicable Security Document) without the written consent of
each Lender;


provided further, that (i) no amendment, waiver or consent shall, unless in writing
and signed by the applicable Issuing Lender in addition to the Lenders required above, affect the
rights or duties of such Issuing Lender under this Agreement or any Letter of Credit Application
relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent
shall, unless in writing and signed by the Swingline Lender in addition to the Lenders required
above, affect the rights or duties of the Swingline Lender as such under this Agreement; (iii) no
amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in
addition to the Lenders required above, affect the rights or duties of the Administrative Agent as
such under this Agreement or any other Loan Document; and (iv) the Fee Letters may be amended, or
rights or privileges thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to
approve or disapprove any amendment, waiver or consent hereunder, except that the Revolving Credit
Commitment of such Lender may not be increased or extended without the consent of such Lender.




     In addition, notwithstanding anything to the contrary herein, each Lender hereby authorizes
the Administrative Agent on its behalf, and without its further consent, to enter into amendments
to this Agreement and the other Loan Documents as the Administrative Agent may reasonably deem
appropriate in order to effectuate any increase in the Revolving Credit Commitment pursuant to
Section 2.7 or any Incremental Term Loans pursuant to Section 2.8, including,
without limitation, amendments to permit such increases in the Revolving Credit Commitment and any
Incremental Term Loans to share ratably in the benefits of this Agreement and the other Loan
Documents and to include appropriately any Lenders under such increases in the Revolving Credit
Commitment and any Incremental Term Loans in any determination of Required Lenders;
provided that no such amendment shall adversely affect in any material respect the rights
of any Lender, in each case, without the written consent of such Lender.



99









 





     SECTION 13.3 Expenses; Indemnity.



     (a) Costs and Expenses. The Borrower and any other Credit Party, jointly and
severally, shall pay (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent
and its Affiliates (including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent), in connection with the syndication of the credit facilities provided for
herein, the preparation, negotiation, execution, delivery and administration of this Agreement and
the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or
thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii)
all reasonable out-of-pocket expenses incurred by the Issuing Lenders in connection with the
issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment
thereunder and (iii) all out-of-pocket expenses incurred by the Administrative Agent, each Lender
and the Issuing Lenders in connection with the enforcement or preservation of any rights
(including, without limitation, all such out-of-pocket expenses incurred during any workout,
restructuring or related negotiations in respect of any Loans or Letters of Credit) (A) in
connection with this Agreement and the other Loan Documents, including its rights under this
Section, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including,
without limitation, the fees and disbursements of counsel to the Administrative Agent, each Lender
and the Issuing Lenders; provided that, so long as no Default or Event of Default exists,
such reimbursement for legal fees and disbursements shall be limited to the fees and disbursements
of one primary counsel designated by the Administrative Agent plus the fees and disbursements of
any local and specialist counsel engaged by the Administrative Agent.



     (b) Indemnification by the Borrower. The Borrower shall indemnify the Administrative
Agent (and any sub-agent thereof), each Lender and each 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 (including, without limitation, any
Environmental Claims or civil penalties or fines assessed by OFAC), damages, liabilities and
related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee),
incurred by any Indemnitee or asserted against any Indemnitee by any third party or by the Borrower
or any other Credit Party arising out of, in connection with, or as a result of (i) the execution
or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated
hereby or thereby, the performance by the parties hereto of their respective obligations hereunder
or thereunder or the consummation of the transactions contemplated hereby or thereby, or, in the
case of the Administrative Agent (and any sub-agent thereof) and its Related Parties only, the
administration of this Agreement and the other Loan Documents (ii) any Loan or Letter of Credit or
the use or proposed use of the proceeds therefrom (including any refusal by the applicable 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 comply with the terms of such Letter of Credit), (iii)
any actual or alleged presence or release of Hazardous Materials on or from any property owned or
operated by the Borrower or any of its Subsidiaries, or any Environmental Claim related in any way
to the Borrower or any of its Subsidiaries, (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on contract, tort or
any other theory, whether brought by a third party or by the Borrower or any other Credit Party,
and regardless of whether any Indemnitee is a party thereto, or (v) any claim (including, without



100









 




limitation, any Environmental Claims or civil penalties or fines assessed by OFAC),
investigation, litigation or other proceeding (whether or not the Administrative Agent or any
Lender is a party thereto) and the prosecution and defense thereof, arising out of or in any way
connected with the Loans, this Agreement, any other Loan Document or any documents contemplated by
or referred to herein or therein or the transactions contemplated hereby or thereby, including
without limitation, reasonable attorneys and consultant’s fees, 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 Credit 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 Credit Party has obtained a final and
nonappealable judgment in its favor on such claim as determined by a court of competent
jurisdiction.




     (c) Reimbursement by Lenders. To the extent that the Borrower for any reason fails to
indefeasibly pay any amount required under clause (a) or (b) of this Section to be paid by it to
the Administrative Agent (or any sub-agent thereof), the applicable 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 applicable Issuing Lender or such Related Party, as the case may be, such
Lender’s Applicable Margin (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 subagent) or the applicable 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 applicable Issuing Lender in connection with such
capacity. The obligations of the Lenders under this clause (c) are subject to the provisions of
Section 4.7.



     (d) 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 clause (b) above 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.



     (e) Payments. All amounts due under this Section shall be payable promptly after
demand therefor.



     (f) Survival. The agreements in this Section shall survive the resignation of the
Administrative Agent, any Issuing Lender and the Swing Line Lender, the replacement of any



101









 




Lender, the termination of the Revolving Credit Commitments and the repayment, satisfaction or
discharge of all the other Obligations.




     SECTION 13.4 Right of Set-off. If an Event of Default shall have occurred and be
continuing, each Lender, each Issuing Lender, the Swingline Lender and each of their respective
Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted
by Applicable Law, to set off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency) at any time held and other obligations (in whatever
currency) at any time owing by such Lender, such Issuing Lender, the Swingline Lender or any such
Affiliate to or for the credit or the account of the Borrower or any other Credit Party against any
and all of the obligations of the Borrower or such Credit Party now or hereafter existing under
this Agreement or any other Loan Document to such Lender, such Issuing Lender or the Swingline
Lender, irrespective of whether or not such Lender, such Issuing Lender or the Swingline Lender
shall have made any demand under this Agreement or any other Loan Document and although such
obligations of the Borrower or such Credit Party may be contingent or unmatured or are owed to a
branch or office of such Lender, such Issuing Lender or the Swingline Lender different from the
branch or office holding such deposit or obligated on such indebtedness. The rights of each
Lender, each Issuing Lender, the Swingline Lender and their respective Affiliates under this
Section are in addition to other rights and remedies (including other rights of setoff) that such
Lender, such Issuing Lender, the Swingline Lender or their respective Affiliates may have. Each
Lender, each Issuing Lender and the Swingline 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.



     SECTION 13.5 Governing Law.



     (a) Governing Law. This Agreement and the other Loan Documents, unless expressly set
forth therein, shall be governed by, and construed in accordance with, the law of the State of New
York, without reference to the conflicts or choice of law principles thereof, other than such
principles that are stated in Section 5-1401 and 5-1402 of the General Obligations Law of the State
of New York.



     (b) Submission to Jurisdiction. The Borrower and each other Credit 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 the Borough of Manhattan and of the United States
District Court of the Borough of Manhattan, 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 any Issuing Lender may
otherwise have to bring any action or proceeding relating to this Agreement or any



102









 




other Loan Document against the Borrower or any other Credit Party or its properties in the
courts of any jurisdiction.




     (c) Waiver of Venue. The Borrower and each other Credit Party irrevocably and
unconditionally waives, to the fullest extent permitted by Applicable Law, any objection that it
may now or hereafter have to the laying of venue of any action or proceeding arising out of or
relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) of
this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent
permitted by Applicable Law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.



     (d) Service of Process. Each party hereto irrevocably consents to service of process
in the manner provided for notices in Section 13.1. Nothing in this Agreement will affect
the right of any party hereto to serve process in any other manner permitted by Applicable Law.



     SECTION 13.6 Waiver of Jury Trial.



     (a) 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, 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.



     SECTION 13.7 Reversal of Payments. To the extent the Borrower makes a payment or
payments to the Administrative Agent for the ratable benefit of the Lenders or the Administrative
Agent receives any payment or proceeds of the Collateral, which payments or proceeds or any part
thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any bankruptcy law, state or
federal law, common law or equitable cause, then, to the extent of such payment or proceeds repaid,
the Obligations or part thereof intended to be satisfied shall be revived and continued in full
force and effect as if such payment or proceeds had not been received by the Administrative Agent.



     SECTION 13.8 Injunctive Relief; Punitive Damages.



     (a) The Borrower recognizes that, in the event the Borrower fails to perform, observe or
discharge any of its obligations or liabilities under this Agreement, any remedy of law may prove
to be inadequate relief to the Lenders. Therefore, the Borrower agrees that the Lenders, at the
Lenders’ option, shall be entitled to temporary and permanent injunctive relief in any such



103









 




case without the necessity of proving actual damages, to the extent permitted by Applicable
Law and principles of equity.




     (b) To the extent permitted by Applicable Law, the Administrative Agent, the Lenders and the
Borrower (on behalf of itself and the Credit Parties) hereby agree that no such Person shall have a
remedy of punitive or exemplary damages against any other party to a Loan Document and each such
Person hereby waives any right or claim to punitive or exemplary damages that they may now have or
may arise in the future in connection with any Dispute, whether such Dispute is resolved through
arbitration or judicially.



     SECTION 13.9 Accounting Matters. If at any time any change in GAAP would affect the
computation of any financial ratio or requirement set forth in any Loan Document, and either the
Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the
Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original
intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders);
provided that, until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide
to the Administrative Agent and the Lenders financial statements and other documents required under
this Agreement or as reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement made before and after giving effect to such change in
GAAP.



     SECTION 13.10 Successors and Assigns; Participations.



     (a) Successors and Assigns Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that neither the Borrower nor any other Credit 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 Eligible Assignee in accordance with the
provisions of paragraph (b) of this Section, (ii) by way of participation in accordance with the
provisions of paragraph (d) of this Section or (iii) by way of pledge or assignment of a security
interest subject to the restrictions of paragraph (f) of this Section (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
paragraph (d) of this Section 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.



     (b) Assignments by Lenders. Any Lender may at any time assign to one or more Eligible
Assignees all or a portion of its rights and obligations under this Agreement (including all or a
portion of its Revolving Credit Commitment and the Loans (including for purposes of this paragraph
(b), participations in L/C Obligations and in Swingline Loans) at the time owing to it);
provided that



104









 





          (i) except in the case of an assignment of the entire remaining amount of the assigning
Lender’s Revolving Credit Commitment and the Loans at the time owing to it, the aggregate amount of
the Revolving Credit Commitment (which for this purpose includes Loans outstanding thereunder) or,
if the applicable Revolving Credit Commitment is not then in effect, the principal outstanding
balance of the Loans of the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Assumption with respect to such assignment is delivered to the
Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the
Trade Date) shall not be less than $5,000,000, unless (A) such assignment is made to an existing
Lender, to an Affiliate thereof or to an Approved Fund with respect thereto, or (B) each of the
Administrative Agent and, so long as no Default or Event of Default has occurred and is continuing,
the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed);
provided, however, that concurrent assignments to members of an Assignee Group and
concurrent assignments from members of an Assignee Group to a single Eligible Assignee (or to an
Eligible Assignee and members of its Assignee Group) will be treated as a single assignment for
purposes of determining whether such minimum amount has been met;




          (ii) each partial assignment shall be made as an assignment of a proportionate part of all the
assigning Lender’s rights and obligations under this Agreement with respect to the Loans or the
Revolving Credit Commitment assigned;




          (iii) no consent shall be required for any assignment except to the extent required by
subsections (b)(i) and (b)(iv) of this Section and, in addition:





     (A) the consent of the Borrower (such consent not to be unreasonably withheld
or delayed) shall be required unless (1) an Event of Default has occurred and is
continuing at the time of such assignment or (2) such assignment is to a Lender, an
Affiliate of a Lender or an Approved Fund with respect to a Lender;




     (B) the consent of the Administrative Agent (such consent not to be
unreasonably withheld or delayed) shall be required unless such assignment is to a
Person that is a Lender, an Affiliate of a Lender or an Approved Fund with respect
to a Lender;




     (C) the consent of the Issuing Lenders (such consent not to be unreasonably
withheld or delayed) shall be required for any assignment that increases the
obligation of the assignee to participate in exposure under one or more Letters of
Credit (whether or not then outstanding);




     (D) the consent of the Swing Line Lender (such consent not to be unreasonably
withheld or delayed) shall be required for any assignment;



          (iv) the parties to each assignment shall execute and deliver to the Administrative Agent an
Assignment and Assumption, together with a processing and recordation fee of $3,500 for each
assignment, and the Eligible Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire;




105









 








          (v) no such assignment shall be made to the Borrower or any of the Borrower’s Affiliates or
Subsidiaries; and




          (vi) no such assignment shall be made to a natural person.



Subject to acceptance and recording thereof by the Administrative Agent pursuant to paragraph (c)
of this Section, from and after the effective date specified in each Assignment and Assumption, the
Eligible Assignee thereunder shall be a party to this Agreement and, to the extent of the interest
assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations
under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be
entitled to the benefits of Sections 4.8, 4.9, 4.10, 4.11 and
13.3 with respect to facts and circumstances occurring prior to the effective date of such
assignment. Upon request, the Borrower (at its expense) shall execute and deliver a Note to the
assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this paragraph shall be treated for purposes of this Agreement
as a sale by such Lender of a participation in such rights and obligations in accordance with
paragraph (d) of this Section.




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



     (d) Participations. Any Lender may at any time, without the consent of, or notice to,
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 Revolving Credit Commitment and/or the Loans
(including such Lender’s participations in L/C Obligations and/or Swingline Loans)owing to it);
provided that (i) such Lender’s rights and obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the
exercise of such rights and the performance of such obligations and (iii) the Borrower, the
Administrative Agent, the Lenders and the Issuing Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and obligations under this
Agreement.



     Any agreement or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this Agreement and to approve any



106









 




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 or modification described in
Section 13.2 that directly affects such Participant. Subject to paragraph (e) of this
Section, the Borrower agrees that each Participant shall be entitled to the benefits of
Sections 4.8, 4.9, 4.10 and 4.11 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section. To
the extent permitted by law, each Participant also shall be entitled to the benefits of Section
13.4 as though it were a Lender, provided such Participant agrees to be subject to Section
4.6 as though it were a Lender.




     (e) Limitations upon Participant Rights. A Participant shall not be entitled to
receive any greater payment under Sections 4.10 and 4.11 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 4.11 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 4.11(e) as though it were a Lender.



     (f) Certain Pledges. Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement (including under its Notes, if any) to
secure obligations of such Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall
release such Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.



     (g) Electronic Execution of Assignments. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment and Assumption shall be deemed to include
electronic signatures or the keeping of records in electronic form, each of which shall be of the
same legal effect, validity or enforceability as a manually executed signature or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as provided for in any
applicable law, including the Federal Electronic Signatures in Global and National Commerce Act,
the New York State Electronic Signatures and Records Act, or any other similar state laws based on
the Uniform Electronic Transactions Act.



     (h) Resignation as Issuing Lender or Swingline Lender after Assignment.
Notwithstanding anything to the contrary contained herein, if at any time Bank of America assigns
all of its Revolving Credit Commitment and Revolving Credit Loans pursuant to subsection (b) above,
Bank of America may, (i) upon 30 days’ notice to the Borrower and the Lenders, resign as an Issuing
Lender and/or (ii) upon 30 days’ notice to the Borrower, resign as Swingline Lender. In the event
of any such resignation as an Issuing Lender or Swingline Lender, the Borrower shall be entitled to
appoint from among the Lenders a successor Issuing Lender or Swingline Lender hereunder;
provided, however, that no failure by the Borrower to appoint any such successor
shall affect the resignation of Bank of America as an Issuing Lender or Swingline Lender, as the
case may be. If Bank of America resigns as an Issuing Lender, it shall retain all the rights,
powers, privileges and duties of an Issuing Lender hereunder with respect to all Letters of Credit
outstanding as of the effective date of its resignation as an Issuing



107









 




Lender and all L/C Obligations with respect thereto (including the right to require the L/C
Participants to make payments and fund risk participations in any unreimbursed portions of any
payment made by the Issuing Lender pursuant to Section 3.4(b)). If Bank of America resigns
as Swingline Lender, it shall retain all the rights of the Swingline Lender provided for hereunder
with respect to Swingline Loans made by it and outstanding as of the effective date of such
resignation, including the right to require the Revolving Credit Lenders to make Revolving Credit
Loans or fund risk participations in outstanding Swingline Loans pursuant to Section
2.2(b). Upon the appointment of a successor Issuing Lender and/or Swingline Lender, (a) such
successor shall succeed to and become vested with all of the rights, powers, privileges and duties
of the retiring Issuing Lender or Swingline Lender, as the case may be, and (b) the successor
Issuing Lender shall issue letters of credit in substitution for the Letters of Credit, if any,
outstanding at the time of such successor or make other arrangements satisfactory to Bank of
America to effectively assume the obligations of Bank of America with respect to such Letters of
Credit.




     SECTION 13.11 Confidentiality. Each of the Administrative Agent, the Lenders and the
Issuing Lenders agrees to maintain the confidentiality of the Information (as defined below),
except that Information may be disclosed (a) to its Affiliates and to its Affiliates’ respective
partners, directors, officers, employees, agents, accountants, legal counsel, advisors and
representatives (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by, or required to be disclosed to, any rating agency,
or regulatory or similar authority purporting to have jurisdiction over it (including any
self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the
extent required by Applicable Laws or regulations or by any subpoena or similar legal process, (d)
to any other party hereto, (e) in connection with the exercise of any remedies under this Agreement
or under any other Loan Document (or any Hedging Agreement with a Lender or the Administrative
Agent) or any action or proceeding relating to this Agreement or any other Loan Document (or any
Hedging Agreement with a Lender or the Administrative Agent) or the enforcement of rights hereunder
or thereunder, (f) 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 any Eligible Assignee
invited to be a Lender pursuant to Section 2.7 or 2.8, or (B) any actual or
prospective counterparty (or its advisors) to any swap or derivative transaction relating to the
Borrower and its obligations, (g) with the consent of the Borrower, to Gold Sheets and other
similar bank trade publications, such information to consist of deal terms and other information
customarily found in such publications, (h) to the extent such Information (A) becomes publicly
available other than as a result of a breach of this Section or (B) becomes available to the
Administrative Agent or any Lender on a nonconfidential basis from a source other than the Borrower
or (i) to governmental regulatory authorities in connection with any regulatory examination of the
Administrative Agent, any Lender, any Issuing Lender or any of their respective Affiliates or in
accordance with any such Person’s regulatory compliance policy if such Person deems the same to be
necessary for the mitigation of claims by those authorities against such Person or any of its
Affiliates. For purposes of this Section, “Information” means all information received
from any Credit Party relating to any Credit Party or any of their respective businesses, other
than any such information that is available to the Administrative Agent, any Lender or any Issuing
Lender on a nonconfidential basis prior to disclosure by any



108









 




Credit Party; provided that, in the case of information received from a Credit Party
after the date hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.




     Each of the Administrative Agent, the Lenders and the Issuing Lenders acknowledges that (a)
the Information may include material non-public information concerning the Borrower or a
Subsidiary, as the case may be, (b) it has developed compliance procedures regarding the use of
material non-public information and (c) it will handle such material non-public information in
accordance with Applicable Law, including United States Federal and state securities laws.



     SECTION 13.12 Performance of Duties. Each of the Credit Party’s obligations under
this Agreement and each of the other Loan Documents shall be performed by such Credit Party at its
sole cost and expense.



     SECTION 13.13 All Powers Coupled with Interest. All powers of attorney and other
authorizations granted to the Lenders, the Administrative Agent and any Persons designated by the
Administrative Agent or any Lender pursuant to any provisions of this Agreement or any of the other
Loan Documents shall be deemed coupled with an interest and shall be irrevocable so long as any of
the Obligations remain unpaid or unsatisfied, any of the Revolving Credit Commitment remains in
effect or the Credit Facility has not been terminated.



     SECTION 13.14 Survival of Indemnities. Notwithstanding any termination of this
Agreement, the indemnities to which the Administrative Agent and the Lenders are entitled under the
provisions of this Article XIII and any other provision of this Agreement and the other
Loan Documents shall continue in full force and effect and shall protect the Administrative Agent
and the Lenders against events arising after such termination as well as before.



     SECTION 13.15 Titles and Captions. Titles and captions of Articles, Sections and
subsections in, and the table of contents of, this Agreement are for convenience only, and neither
limit nor amplify the provisions of this Agreement.



     SECTION 13.16 Severability of Provisions. Any provision of this Agreement or any
other Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without
invalidating the remainder of such provision or the remaining provisions hereof or thereof or
affecting the validity or enforceability of such provision in any other jurisdiction.



     SECTION 13.17 Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and shall be binding upon all parties, their successors
and assigns, and all of which taken together shall constitute one and the same agreement.



     SECTION 13.18 Integration. This Agreement, together with the other Loan Documents,
comprises the complete and integrated agreement of the parties on the subject matter hereof and
thereof and supersedes all prior agreements, written or oral, on such subject matter. In the event



109









 




of any conflict between the provisions of this Agreement and those of any other Loan Document,
the provisions of this Agreement shall control; provided that the inclusion of supplemental
rights or remedies in favor of the Administrative Agent or the Lenders in any other Loan Document
shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the joint
participation of the respective parties thereto and shall be construed neither against nor in favor
of any party, but rather in accordance with the fair meaning thereof.




     SECTION 13.19 Term of Agreement. This Agreement shall remain in effect from the
Closing Date through and including the date upon which all Obligations arising hereunder or under
any other Loan Document (except for contingent Obligations that expressly survive the termination
of this Agreement or any other Loan Document) shall have been indefeasibly and irrevocably paid and
satisfied in full and the Revolving Credit Commitment has been terminated. No termination of this
Agreement shall affect the rights and obligations of the parties hereto arising prior to such
termination or in respect of any provision of this Agreement which survives such termination.



     SECTION 13.20 Advice of Counsel, No Strict Construction. Each of the parties
represents to each other party hereto that it has discussed this Agreement with its counsel. The
parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the
event an ambiguity or question of intent or interpretation arises, this Agreement shall be
construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall
arise favoring or disfavoring any party by virtue of the authorship of any provisions of this
Agreement.



     SECTION 13.21 No Advisory or Fiduciary Responsibility. In connection with all aspects
of each transaction contemplated hereby (including in connection with any amendment, waiver or
other modification hereof or of any other Loan Document), the Borrower acknowledges and agrees, and
acknowledges its Affiliates’ understanding, that: (i) (A) the arranging and other services
regarding this Agreement provided by the Administrative Agent and the Arrangers, are arm’s-length
commercial transactions between the Borrower and its Affiliates, on the one hand, and the
Administrative Agent and the Arrangers, on the other hand, (B) the Borrower has consulted its own
legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) the
Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of
the transactions contemplated hereby and by the other Loan Documents; (ii) (A) the Administrative
Agent and each Arranger is and has been acting solely as a principal and, except as expressly
agreed in writing by the relevant parties, has not been, is not, and will not be acting as an
advisor, agent or fiduciary for the Borrower or any of its Affiliates or any other Person and (B)
neither the Administrative Agent nor any Arranger has any obligation to the Borrower or any of its
Affiliates with respect to the transactions contemplated hereby except those obligations expressly
set forth herein and in the other Loan Documents and (iii) the Administrative Agent and the
Arrangers and their respective Affiliates may be engaged in a board range of transactions that
involve interests that differ from those of the Borrower and its Affiliates, and neither the
Administrative Agent nor any Arranger has any obligation to disclose any of such interests to the
Borrower or its Affiliates. To the fullest extent permitted by law, the Borrower hereby waives and
releases any claims that it may have against the Administrative Agent and the Arrangers with
respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect
of any transaction contemplated hereby.



110









 





     SECTION 13.22 USA Patriot Act. The Administrative Agent and each Lender hereby
notifies the Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub.
L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify
and record information that identifies the Borrower and Subsidiary Guarantors, which information
includes the name and address of each Borrower and Subsidiary Guarantor and other information that
will allow such Lender to identify such Borrower or Subsidiary Guarantor in accordance with the
Act.



     SECTION 13.23 Inconsistencies with Other Documents; Independent Effect of Covenants.



     (a) In the event there is a conflict or inconsistency between this Agreement and any other
Loan Document, the terms of this Agreement shall control; provided that any provision of
the Security Documents that imposes additional burdens on the Borrower or its Restricted
Subsidiaries or further restricts the rights of the Borrower or its Restricted Subsidiaries or
gives the Administrative Agent or Lenders additional rights shall not be deemed to be in conflict
or inconsistent with this Agreement and shall be given full force and effect.



     (b) The Borrower expressly acknowledges and agrees that each covenant contained in
Articles VIII, IX, or X hereof shall be given independent effect.
Accordingly, the Borrower shall not engage in any transaction or other act otherwise permitted
under any covenant contained in Articles VIII, IX, or X if, before or after
giving effect to such transaction or act, the Borrower shall or would be in breach of any other
covenant contained in Articles VIII, IX, or X.



[Signature pages to follow]




111









 





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



	 	 	 	 	 	 	 
	 	 	CORRECTIONS CORPORATION OF

AMERICA, as Borrower
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ Todd J Mullenger
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Todd J Mullenger
	 

	 	 	 	Title:
	 	Chief Financial Officer and
	 

	 	 	 	 	 	Executive Vice President






CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	AGENT:
	 
	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A., as Administrative
 Agent
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ Roberto O. Salazar
	 	 	 	 	 
	 

	 	 	 	Name:	 	Roberto O. Salazar 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Assistant Vice President 
	 

	 	 	 	 	 	 





CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	LENDERS:
	 
	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A., as Swingline
 Lender, Issuing
Lender and Lender
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/  Barbara P. Levy
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Barbara P. Levy
	 

	 	 	 	Title:
	 	Senior Vice President






CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL
 ASSOCIATION
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ Michael Johnson
	 	 	 	 	 
	 

	 	 	 	Name:	 	Michael Johnson 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Vice President 
	 

	 	 	 	 	 	 





CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ Robert L. Mendoza
	 	 	 	 	 
	 

	 	 	 	Name:	 	Robert L. Mendoza 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Vice President 
	 

	 	 	 	 	 	 





CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	CITIBANK, N.A.
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ Scott A. Miller
	 	 	 	 	 
	 

	 	 	 	Name:	 	Scott A. Miller 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Vice President 
	 

	 	 	 	 	 	 





CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	HSBC BANK USA,
NATIONAL ASSOCIATION
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ Adriana D. Collins
	 	 	 	 	 
	 

	 	 	 	Name:	 	Adriana D. Collins 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	First Vice President 
	 

	 	 	 	 	 	 





CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	SUNTRUST BANK
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ Kap Yarbrough
	 	 	 	 	 
	 

	 	 	 	Name:	 	Kap Yarbrough 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Vice President 
	 

	 	 	 	 	 	 





CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	US BANK NATIONAL ASSOCIATION
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ Michael P. Dickman
	 	 	 	 	 
	 

	 	 	 	Name:	 	Michael P. Dickman 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Vice President 
	 

	 	 	 	 	 	 





CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	LEHMAN BROTHERS
COMMERCIAL BANK
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ George Janes
	 	 	 	 	 
	 

	 	 	 	Name:	 	George Janes 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Chief Credit Officer 
	 

	 	 	 	 	 	 





CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page




 









 





	 	 	 	 	 	 	 
	 	 	BRANCH BANKING AND TRUST COMPANY
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	/s/ R. Andrew Beam
	 	 	 	 	 
	 

	 	 	 	Name:	 	R. Andrew Beam 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Senior Vice President 
	 

	 	 	 	 	 	 





CREDIT AGREEMENT — CORRECTIONS CORPORATION OF AMERICA

Signature Page